Rick, you clearly have not invested in many non-bank debt funds in Australia.
Irrespective of size, they typically charge 0.50% p.a as a management fee.
They use the fund structure as a locked in pool of capital to originate deals, collect their 0.50% management fee and additionally collect their 0.75% to 1.5% origination fee for each deal they write.
So in addition to the $9m of management fees Qualitas collects each year, they get an additional ~$4m p.a for originating these deals. You don't see this figure in the profit/loss statement because the borrower pays Qualitas direct.
There is absolutely no way QRI is being wound up even if it trades at a discount, it is too much of a cash cow for Qualitas. Just like all the ASX LIC's, this will likely end up trading at a permanent discount to NTA.
This made me look at Qualitas, because why not own the company who collects the insane amount of fees. However, not suprisingly, the company is run for employees who are paid a fortune and therefore it is not very profitable for shareholders.
QRI Price at posting:
$1.37 Sentiment: None Disclosure: Held
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