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14:52
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Originally posted by eigenvalue
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There seems to be a discrepancy between the QRI's target return and its performance fee structure. The target is RBA cash rate + 5% to 6.5%, yet the performance hurdle is a flat 8%. According to the PDS, a 20.5% performance fee applies to monthly Net Income above 8.0% of Average Adjusted NAV. Given that the target return varies with the cash rate but the performance hurdle doesn't, this setup seems misaligned. For instance, with the current cash rate of 4.35%, QRI’s lending rates range from 10% to 14% (5.65% to 9.65% above the cash rate). This system could result in high performance fees during high cash rate periods, irrespective of management skill. Conversely, a low cash rate could see QRI missing out on performance fees despite strong management.
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Maybe, or maybe its trading at or around NTA and some profit taking was done when it ran ahead.
(20min delay)