Fund Credit Rating: A-
Target Net Yield: 6% - 8%
Target Net IRR: 8% - 10%
Target Net Yield: 6% - 8%
Target Net IRR: 8% - 10%
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The fund seeks to provide you with access to an uncorrelated asset class that can increase the risk adjusted return of your investment portfolio.
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Providing a low-risk stream of high yield passive income for your credit union.
The fund invests in Freddie Mac K-Deal and SBL B-Piece certificates that are backed by cash flowing and geographically diversified multifamily mortgage loans.
Key Benefits
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Downside Protection
Loans originated by Freddie Mac have experienced an extraordinarily low historical loss rate of 0.076% on all issuance over the last 26 years. B-Piece investors are compensated with higher risk-adjusted returns while still being protected by up to a 30% cushion-to-loss. |
Monthly Income
The Fund generates a stable stream of monthly investor distributions. |
Inflation Hedge
The Fund’s floating rate bonds are a direct beneficiary of rising interest rates. |
Fund Target Allocation
Floating Rate K-Deal B-Pieces
Floating rate B-Pieces receive interest payments that are tied to a predetermined spread adobe the benchmark index (LIBOR or SOFR) and can fluctuate during periods of rising or falling interest rates. They mature at face value.
Floating rate B-Pieces receive interest payments that are tied to a predetermined spread adobe the benchmark index (LIBOR or SOFR) and can fluctuate during periods of rising or falling interest rates. They mature at face value.
Fixed Rate K-Deal B-Pieces
Also, known as accrual bonds, fixed rate B-Pieces are purchased at a deep discount and mature at face value with no recurring interest payments throughout the hold period.
Also, known as accrual bonds, fixed rate B-Pieces are purchased at a deep discount and mature at face value with no recurring interest payments throughout the hold period.
SBL B-Pieces
SBL B-Pieces function the same as fixed and floating rate K-Deal B Pieces, although the underlying loan balances are smaller.
SBL B-Pieces function the same as fixed and floating rate K-Deal B Pieces, although the underlying loan balances are smaller.
Interest Only Strips (I/O Strips)
I/O Strips represent an interest-only class of the fixed and floating rate K-Deal B Pieces. They are acquired at a discount to the total value of future expected interest payments and holders receive interest payments monthly.
I/O Strips represent an interest-only class of the fixed and floating rate K-Deal B Pieces. They are acquired at a discount to the total value of future expected interest payments and holders receive interest payments monthly.
Professionally Management
The fund is offered and managed by Origin Investments. NEED AN ABOUT SECTION ON ORIGIN, top decile manager, met the stringent requirements for K Series purchase
The fund is offered and managed by Origin Investments. NEED AN ABOUT SECTION ON ORIGIN, top decile manager, met the stringent requirements for K Series purchase
Getting to Know Freddie Mac K Series B Certificates
Meet Freddie K. Freddie who? Although Freddie Mac has been offering Freddie K bonds for about 10 years, this may be the first time you’ve heard of them. Freddie K bonds are Multifamily K Certificates that are regularly issued, structured securities, backed by recently originated multifamily mortgage loans. The structure of the Freddie K Class A-2 bonds makes them an excellent alternative to agency bullets, and they can provide a higher yield. For example, a Freddie K A-2 bond was recently priced to yield 25 basis points more than an agency bullet with a similar term length.
What are K-Deals?
Falling under the mortgage-backed securities (MBS) umbrella, K-Deal is the trademarked name of bonds constructed and offered exclusively by The Federal Home Loan Mortgage Corporation (Freddie Mac). Each K-Deal is composed of 50-75 loans backed by institutional-quality multifamily assets diversified across the country.
Falling under the mortgage-backed securities (MBS) umbrella, K-Deal is the trademarked name of bonds constructed and offered exclusively by The Federal Home Loan Mortgage Corporation (Freddie Mac). Each K-Deal is composed of 50-75 loans backed by institutional-quality multifamily assets diversified across the country.
Literature
Getting to Know Freddie Mac K Series
Investor Presentation
A Closer Look at Freddie Mac K-Deals
Due Diligence Packet
Getting to Know Freddie Mac K Series
Investor Presentation
A Closer Look at Freddie Mac K-Deals
Due Diligence Packet
Credit unions have unique fixed income investment needs. In addition to focusing on investment yield, credit unions are making vital decisions that will impact their members.
The Credit Union Investment Strategy Team at Credit Union Wealth Group specializes in providing fixed income investment strategies tailored to the individual needs of all types of credit unions. We go beyond offering traditional investment advice. Our team of experienced investment advisors work hand-in-hand with your credit union to ensure you have the education, support and resources you need to understand and grow your fixed income investment portfolio and seek higher yield on investments.
The Credit Union Investment Strategy Team at Credit Union Wealth Group specializes in providing fixed income investment strategies tailored to the individual needs of all types of credit unions. We go beyond offering traditional investment advice. Our team of experienced investment advisors work hand-in-hand with your credit union to ensure you have the education, support and resources you need to understand and grow your fixed income investment portfolio and seek higher yield on investments.
