The Pinnacle Investment Management Ltd (ASX: PNI) share price soared after it delivered one of the stronger profit reports this August reporting season and the money manager has some more growth plans up its sleeve.
Recently it's launched two new exchange traded funds (ETFs) that offer different options for conservative and income-seeking investors with ultra-low fees that are a big bonus for actively managed ETFs.
The Pinnacle aShares Global Dynamic Income Fund (ASX: SAVE) charges a management fee of 0.5%, no performance fee and a recoverable expenses fee capped at 0.15% of the fund's net asset value.
That's pretty low for an actively managed fund that aims to produce income 4% above the Reserve Bank of Australia's benchmark lending rate.
The fund offers investors global exposure by investing in a diversified portfolio of mainly Australian, North American and European income-producing stocks alongside a smattering of fixed-income or corporate debt issues from well-known global businesses.
Some of the more popular ASX names it owns include Magellan Financial Group Ltd (ASX: MFG), Elders Group Ltd (ASX: ELD), Ramsay Health Care Ltd (ASX: RHC) and Coca-Cola Amatil Ltd (ASX: CCL).
For now its principal problem appears to be liquidity with no trades or volume going through as of today. The fund only listed on August 27 at an initial offer price of $10 and currently shares are being offered for $10.08.
As always with this kind of product it's best for investors to make sure they're buying units on market in line with or below the net asset value per share of the underlying holdings.
Of course for further information investors should be sure to seek professional financial advice and read the full product disclosure statement, financial services guide, and any other appropriate documents.
Pinnacle is also launching a zero management fee exchange traded ETF named Pinnacle aShares Dynamic Cash Fund (ASX: Z3RO) that will only charge recoverable expenses capped at 0.15% of the fund's net asset value. It's aim is to beat the kind of returns you'd get from a typical term deposit or callable savings product at a bank or equivalent risk-free product at a bank today.
For example a typical interest rate on cash savings today at the National Australia Bank Ltd (ASX: NAB) is 1.5 per cent, while Pinnacle aShares Dynamic Cash Fund (ASX: Z3RO) aims to marginally beat that and pay you monthly interest like a bank savings account.
It aims to do this by investing in a variety of money market or short-term debt instruments that offer better yields than typical retail-facing cash deposit saving products. Again, it looks like liquidity could be a problem for now given the lack of buyers or sellers on the Commsec trading platform.
