AFA Private Credit Fund

Focused on Asset-Based Lending

AMCLX Snapshot

(As of 4/30/2024)
Net Investment Accrual Rate1
0 %
1 Year Distribution
Rate 2
0 %
Underlying
Holdings
0
Median
Loan Size3
$ 0  million
Fund Leverage 4
50 %

2.

The 1 Year Distribution Rate is the sum of the four quarterly distribution rates over the prior twelve months. Each quarterly distribution rate is calculated by dividing the actual dividend distributed by the net asset value on the prior day. The distributions over the prior twelve months included ordinary dividends and capital gains and did not include any return of capital. The 1 Year Distribution rate will vary over time, should not be confused with yield, and is not a predictor of future returns.

Overview

Why Private Credit

Attractive Income

Increased bank regulation has created an opportunity for private lenders to originate loans at favorable terms.

Low Volatility

Private loans have historically exhibited lower volatility than publicly traded fixed income.5

Why Asset-Based Lending

Defined Source of Repayment

Loans are secured by physical and financial assets as collateral.6

Differentiated Source of Returns

Asset-based loans provide diversification to other segments of the private credit market.

What Sets the AFA Private Credit Fund Apart

Sourcing Premium

Access to less competed market segments where lenders can charge premium rates

Specialized Expertise

Loans are originated by a select group of boutique lending platforms, each with unique skills and sourcing ability in their market niche

Diversification

The portfolio is diversified across a broad array of industries and collateral types

5.

6.

Based on the standard deviation of returns of the Cliffwater Direct Lending Index (a private loan index) compared to the CS Leveraged Loan Index (an index of publicly traded loans) from 1/1/2005 to 12/31/2023.

There can be no assurance that the amounts realized by liquidating collateral will be sufficient to offset any potential payment defaults.

Performance

(As of 4/30/2024)
Month YTD 1 YR Since Inception Annualized* Since Inception Cumulative*
AMCLX 0.85% 3.26% 9.47% 5.93% 17.74%
CS Leveraged Loan Index 0.68% 3.22% 12.10% 5.89% 17.59%
BBG US Corporate High Yield Index -0.94% 0.52% 9.02% 1.01% 2.90%
BBG US Aggregate Bond Index -2.53% -3.28% -1.47% -4.09% -11.16%

Monthly Returns

Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Year
2021 - - - - - - 0.00% 0.30% 0.61% 0.50% 0.30% 0.51% 2.25%
2022 0.30% 0.30% 0.20% 0.51% -0.51% -0.85% -0.21% 0.73% 0.58% 0.10% 1.04% 0.62% 2.84%
2023 0.86% 0.53% 0.66% 0.21% 0.53% 0.77% 0.96% 0.74% 0.88% 0.63% 0.74% 0.60% 8.44%
2024 0.86% 0.85% 0.67% 0.85% - - - - - - - - 3.26%

Cumulative Performance Since Inception*

Past performance is not indicative of future results.  Performance data represents past returns and future returns may be higher or lower. The value of the Fund’s shares will fluctuate, and upon redemption an investor’s shares may be worth more or less than the original cost. Total returns include reinvestment of distributions and are net of the Fund’s net expenses. * Inception date is June 30, 2021.

Source: Bloomberg, AFA. The Bloomberg US Corporate High Yield Bond Index (BBG HY) measures the USD-denominated, high-yield, fixed-rate corporate bond market. The Credit Suisse Leveraged Loan Index (CS Lvgd Ln) represents the investable universe of USD-denominated, full-funded, broadly syndicated, term loan facilities. The Bloomberg US Aggregate Bond Index is a broad-based flagship benchmark that measures the investment-grade, US dollar-denominated, fixed-rate taxable bond market.

Portfolio

(As of 5/1/2024)

Allocations by Position Type7

Industry Allocations7

7.

Allocations are shown as a percentage of gross assets excluding fund liquidity. This analysis looks through any fund holding to the underlying asset. Allocation percentages will change over time and may not be representative of future allocations. The Fund may stop allocating to the sectors consistent with the Fund’s prospectus without notice.

Management

Investment Advisor

Alternative Fund Advisors (“AFA”) is responsible for the Fund’s investments and day-to-day management of the Fund’s portfolio. AFA was established in 2020 and is dedicated to managing interval funds.

Sub-Advisors

Aon Investments is a leading global pension consulting firm with more than $3.4 trillion in global assets under advisement as of June 30, 2022.

Atrato Consulting provides research and due diligence on custom alternative investments for wealth managers, endowments, and foundations and has over $1.4 billion in assets under advisement as of December 31, 2022.

Fund Facts

Structure

Interval Fund

Eligibility

Accredited Investors

Ticker

AMCLX

Minimum Investment

$1 million at firm level

No minimum at account level

CUSIP

00123V103

Purchases

Daily at NAV

Net Assets

$195 million (4/30/2024)

Redemptions9

Quarterly with limit of 5-25% of Fund assets each quarter

Net Expense Ratio8

Institutional Class (AMCLX): 1.45%

Tax Reporting

1099

8.

Net Expense Ratio excludes Interest on Borrowings and Acquired Fund Fees and Expenses (“AFFE”). The Investment Manager has entered into an Expense Limitation and Reimbursement Agreement effective until 8/31/2024 whereby certain of the Fund’s expenses (“Specified Expenses”) will not exceed 0.15% on an annualized basis. Specified Expenses include all Fund expenses other than the management fee, shareholder service fee, fees and interest on borrowed funds, AFFE and certain other expenses. See the Fund’s Prospectus for further details

How to Invest

The AFA Private Credit Fund is an interval fund that makes it easy for investment professionals to invest without the need for subscription agreements. It features point-and-click trading using the ticker AMCLX, 1099 tax reporting, and daily subscriptions.

Interested in AFA Private Credit Fund for Your Clients?

Footnotes
  1. The Net Investment Accrual Rate is the annualized rate at which the Fund was accruing net investment income (interest and dividends, net of fees and expenses) as of 5/1/2024. The Net Investment Accrual Rate should not be confused with yield, will vary over time, and is not a predictor of future Fund return.
  2. The 1 Year Distribution Rate is the sum of the four quarterly distribution rates over the prior twelve months. Each quarterly distribution rate is calculated by dividing the actual dividend distributed by the net asset value on the prior day. The distributions over the prior twelve months included ordinary dividends and capital gains and did not include any return of capital. The 1 Year Distribution Rate will vary over time, should not be confused with yield, and is not a predictor of future returns.
  3. Median Loan Size is calculated as the weighted median using the relative weight of each loan in the Fund as of the most recent holdings information from the underlying managers.
  4. Fund Leverage represents Fund level borrowings net of cash (if any) as a percentage of the net assets of the Fund. Underlying Fund holdings may utilize additional leverage as part of their investment strategy.
  5. Based on the standard deviation of returns of the Cliffwater Direct Lending Index (a private loan index) compared to the CS Leveraged Loan Index (an index of publicly traded loans) from 1/1/2005 to 12/31/2023.
  6. There can be no assurance that the amounts realized by liquidating collateral will be sufficient to offset any potential payment defaults.
  7. Allocations are shown as a percentage of gross assets excluding fund liquidity. This analysis looks through any fund holding to the underlying asset. Allocation percentages will change over time and may not be representative of future allocations. The Fund may stop allocating to the sectors consistent with the Fund’s prospectus without notice.
  8. Net Expense Ratio excludes Interest on Borrowings and Acquired Fund Fees and Expenses (“AFFE”). The Investment Manager has entered into an Expense Limitation and Reimbursement Agreement effective until 8/31/2024 whereby certain of the Fund’s expenses (“Specified Expenses”) will not exceed 0.15% on an annualized basis. Specified Expenses include all Fund expenses other than the management fee, shareholder service fee, fees and interest on borrowed funds, AFFE and certain other expenses. See the Fund’s Prospectus for further details.
  9. The quarterly repurchase offer is expected to be 5% but may range from 5% to 25% subject to approval by the Board of Trustees. If a purchase offer is oversubscribed, shareholders will only be able to have a portion of their shares repurchased. There is no guarantee that shareholders will be able to tender their shares when or in the amount they desire.

Investment Considerations and Disclosures

Read the prospectus carefully before you invest.

Investors should carefully consider the Fund’s investment objectives, risks, charges, and expenses before investing. This information is included in the Fund Prospectus and a copy may be obtained by calling 800-452-6804 or by contacting us here.

An investment in the Fund involves a high degree of risk. An investment in the Fund should be viewed only as part of an overall investment program and you should invest only if you can sustain a complete loss of your principal. Please read the prospectus carefully. An investment in the Fund is subject to, among others, the following risks:

  • The Fund is not intended as a complete investment program but rather the Fund is designed to help investors diversify into private credit investments.
  • The Fund is a “nondiversified” management investment company registered under the Investment Company Act of 1940. Since the Fund is non-diversified, it is subject to higher reduction of capital and volatility than a fund more proportionately allocated among a large number of securities.
  • An investment in the Fund involves risk. The Fund is new with no significant operating history by which to evaluate its potential performance. There can be no assurance that the Fund’s strategy will be successful.
  • The Fund may use leverage its investments by “borrowing.” The use of leverage increases both risk of loss and profit potential.
  • The Fund is subject to large shareholder transaction risks which may cause the Fund to sell portfolio securities at times when it would not otherwise do to so satisfy large shareholder redemptions.
  • Shares of the Fund are not listed on any securities exchange and it is not anticipated that a secondary market for shares will develop.
  • Shares are appropriate only for those investors who can tolerate a high degree of risk, and do not require a liquid investment.
  • There is no assurance that you will be able to tender your shares when or in the amount that you desire. Although the Fund will offer quarterly liquidity through a quarterly repurchase process, an investor may not be able to sell or otherwise liquidate all their shares tendered during a quarterly repurchase offer.
  • The Fund’s investment in private credit companies is speculative and involves a high degree of risk, including the risk associated with leverage.

 

The Fund has an interval fund structure pursuant to which the Fund, subject to applicable law, conducts quarterly repurchase offers for no less than 5% of the Fund’s Shares outstanding at NAV. While the quarterly repurchase offer is expected to be 5%, the amount of each quarterly repurchase offer may be 5% to 25% subject to approval of the Board of Trustees (the “Board” and each of the trustees on the Board, a “Trustee”). It is also possible that a repurchase offer may be oversubscribed, with the result that shareholders may only be able to have a portion of their Shares repurchased. There is no assurance that you will be able to tender your Shares when or in the amount that you desire.

Distributed by Foreside Fund Services, LLC

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