A Unique Opportunity
Now, more than ever, Canadian investors are struggling to find steady, predictable returns to fill the income role in their portfolios. Traditional sources of investment income are yielding minimal returns and market volatility is likely here to stay.
At the same time, many Canadian small business and consumers lack access to convenient and accessible financing options from traditional institutions because: loan sizes are too small to generate attention from lenders; application of traditional asset based underwriting standards disqualify many Canadian small business and consumers; outdated technology does not allow lenders to move quickly or efficiently; and traditional lenders have a low-risk appetite.
This gap in the market has given rise to the space known as specialty finance where innovative, niche finance companies are using new technology, platforms and non-traditional data sources to more effectively and efficiently serve businesses and consumers not adequately served by the banking industry.
In order to fund these loans, there is a need for pools of private capital that sit outside the banking system.
This is where we come in.
At Merchant Opportunities Fund, we leverage our market knowledge and seasoned experience to select, assess and manage our growing portfolio. As professional risk managers, we value patience, profitability, alignment and accountability. We do not rush to grow, and have positioned our fund to deliver a consistent, robust investment product for our investors over the long-term.
Now, thanks to our prudent investment philosophy, we are well-positioned to capitalize on post-pandemic opportunities in a less competitive market.
- 8.3% Average Annual Compound Return
- Proven Track Record
- A Decade of Prudence & Profitability
As of March 31, 2021.
How It Works
Merchant Opportunities Fund pools money to deploy into a portfolio of assets with the purpose of generating a predictable, above average return.
Our capital is invested into a collection of well-selected, niche specialty finance portfolios of more than 6,000 short-term loans and advances that specifically address challenges for small business owners and consumers.
Each month when our highly diversified portfolios of well-selected customers repay their loans and advances, this generates predictable yield. We then return consistent quarterly distributions to our investors.
Proven Investment Strategies
Macro-economic factors that guide our strategic opportunities
Specialty financing is growing exponentially on a global scale.
- Private market-like returns
- Lower correlation with other asset classes
- Diversification across industry, geography and customer base
- Greater liquidity than most other private alternatives
*Source: Statistica Alternative Lending Report 2020
Micro-economic factors that guide our strategic opportunities
Here’s what we look for in structuring our portfolio:
- Our capital is invested into a collection of well-selected, niche specialty finance portfolios of short-term loans and advances.
- Credit niches that are underserved due to supply and demand imbalances.
- Diversified credit pools with a small average loan or advance size and risk spread across many accounts.
- Short term loans and advances (10-11 months) that are paid back quickly.
- Important note: As part of our approach to successfully navigating the global pandemic, we have only been providing credit to borrowers unaffected by COVID for more than 14 months. For more details on our response to the global pandemic, please download your Investor Kit here.
A Unique Investment Opportunity
We’ve generated attractive, consistent and highly diversified returns for more than a decade, proving that our disciplined approach to risk management has been successful through economic cycles, including the global pandemic. With expertise as seasoned operators of several industry-leading specialty finance companies and professional risk managers, our management is uniquely qualified to assess, select and manage specialty finance portfolios for the long term.
Investment in our fund is highly diversified across our portfolio of more than 6,000 customers, which is further diversified across Canadian geographies and 100+ industries. We value patience and alignment and invest our money alongside our investors’. With management owning more than 35% of total fund equity, we win when our investors win.
Target investor return is 10-12% (net of all fees and expenses). Thanks to our prudent investment philosophy, we are well-positioned to capitalize on post-pandemic opportunities in a less competitive market, and our investment is RRSP, RRIF, RESP, LIRA, TFSA eligible.
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