The Number 1 Fixed Income Investment For 2021 - www.capital3.pm - Capital 3PM

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The Number 1
Fixed Income
 Investment
   For 2021.

Introduction to Fixed
Income Investments
Fixed income refers to any type of investment
under which the borrower or issuer is obliged to
make payments of a fixed amount on a fixed
schedule. For example, the borrower may have to
pay interest at a fixed rate once a year and repay
the principal amount on maturity. Fixed-income
securities can be contrasted with equity
securities, often referred to as stocks and shares,
that create no obligation to pay dividends or any
other form of income.

In order for a company to grow its business, it
often must raise money, for example, to finance
an acquisition; to buy equipment or land; or to
invest in new product development. The terms on
which investors will finance the company will
depend on the risk profile of the company. The
company can give up equity by issuing stock or
can promise to pay regular interest and repay the
principal on the loan (bonds or bank loans).
Fixed-income securities also trade differently than
equities. Whereas equities, such as common
stock, trade on exchanges or other established
trading venues, many fixed-income securities
trades over the counter on a principal basis.

The term “fixed” in “fixed income” refers to both
the schedule of obligatory payments and the
amount. “Fixed income securities” can be
distinguished from inflation-indexed bonds,
variable-interest rate notes, and the like. If an
issuer misses a payment on a fixed income
security, the issuer is in default, and depending on
the relevant law and the structure of the security,
the payees may be able to force the issuer into
bankruptcy. In contrast, if a company misses a
quarterly dividend to stock (non-fixed income)
shareholders, there is no violation of any payment
covenant, and no default.

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Investors
Investors in fixed-income securities are typically looking for a
constant and secure return on their investment. For example, a
retired person might like to receive a regular dependable payment
to live on like gratuity, but not consume principal. This person can
buy a bond with their money and use the coupon payment (the
interest) as that regular dependable payment.

When the bond matures, or is refinanced, the person will have their
money returned to them. The major investors in fixed-income
securities are institutional investors, such as pension plans, mutual
funds, insurance companies and other high net worth and
sophisticated investors.

Borrowers
Governments issue government bonds in their own currency and
sovereign bonds in foreign currencies. State and local governments
issue municipal bonds to finance projects or other major spending
initiatives. Debt issued by government-backed agencies is called an
agency bond. Companies can issue a corporate bond or obtain
money from a bank through a corporate loan. Preferred stocks
share some of the characteristics of fixed interest bonds.

Securitized bank lending (e.g., credit card debt, car loans or
mortgages) can be structured into other types of fixed income
products such as ABS – asset-backed securities which can be traded
on exchanges just like corporate and government bonds.

How Does Fixed Income Work?
The term fixed income refers to the interest payments that an
investor receives, which are based on the creditworthiness of the
borrower and current interest rates. Generally speaking, fixed
income securities such as bonds pay a higher interest, known as the
coupon.

The borrower is willing to pay more interest in return for being able
to borrow the money for a longer period of time. At the end of the
security’s term or maturity, the borrower returns the borrowed
money, known as the principal.

 2

Examples of Fixed Income

1. Bonds

The topic of bonds is, by itself, a whole area of financial or investing study. In
general terms, they can be defined as loans made by investors to an issuer, with
the promise of repayment of the principal amount at the established maturity date,
as well as regular coupon payments (generally occurring every six months), which represent
the interest paid on the loan. The purpose of such loans ranges widely. Bonds are typically issued
by governments or corporations that are looking for ways to finance projects or operations.

2. Treasury Bills

Considered the safest short-term debt instrument, Treasury bills are issued by the US federal
government. With maturities ranging from one to 12 months, these securities most commonly
involve 28, 91, and 182-day (one month, three months, and six months) maturities. These
instruments offer no regular coupon or interest payments.

Instead, they are sold at a discount to their face value, with the difference between their market
price and face value representing the interest rate they offer investors. As a simple example, if a
Treasury bill with a face value, or par value, of $100 sells for $90, then it is offering roughly 10%
interest.

3. Money Market Instruments

Money market instruments include securities such as commercial paper, banker’s acceptances,
certificates of deposit (CD), and repurchase agreements (“repo”). Treasury bills are technically
included in this category, but due to the fact that they are traded in such high volume, they have
their own category here.

4. Asset-Backed Securities (ABS)

Asset-backed Securities (ABS) are fixed income securities backed by financial assets that have
been “securitized,” such as credit card receivables, auto loans, or home-equity loans. ABS
represent a collection of such assets that have been packaged together in the form of a single
fixed-income security. For investors, asset-backed securities are usually an alternative to investing
in corporate debt. Capital 3PM specializes in loan notes that are asset-backed and could be
treated as ABS.
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So, what is Capital 3PM’s Loan Note?
Capital 3PM has, over the last 18 years, built strong and trusted relationships with a few select
corporations who use Capital 3PM to raise money for the funding of their business projects.
Capital 3PM has worked closely with the corporation to create an asset-backed and 100% secured
Loan Note for high net worth and sophisticated investors.

This Loan note can be from 12 – 24 months with either semi-annually or deferred coupon
payments at 8-12%. The capital raised through the Loan Note is used to fund the building of
commercial assets, that have already been either leased or sold before the project even
commences.

The corporations we work with have a business strategy of ‘start with the exit in mind’, meaning
that before any building work on the land commences the commercial properties have either
been sold (often to institutions or pension funds) or leased to global brand names such as
MacDonald’s and Starbucks.

Capital 3PM has an unblemished track record, with their providers paying both coupon and
principal on time and in full. There has never been a default on any Loan Note to date

What makes a good Loan Note?
Significant due diligence is a critical aspect to a successful Loan Note. Having a due diligence
process is essential to making sure the Loan Notes are a solid and secure investment.

To date Loan Notes have a chequered history, there are many issuers of Loan Notes that have
done little or no due diligence before offering this to investors.

    •   At Capital 3PM we only back corporations that can demonstrate the following:
    •   10-year track record (minimum)
    •   $1Billion of assets under management
    •   Regulated Security Trustee from a tier 1 jurisdiction
    •   100% unblemished performance for their clients (principal and coupon payments made on
        time and in full).
    •   UK Onshore Banking Presence
    •   A Board of Directors with hundreds of combined years of experience in both the corporate
        and entrepreneurial world

4

Our Due Diligence in
more detail
One of the reasons why Capital 3PM will look
for Loan Note providers who have a minimum
of 10 years track record, is that we are back
testing their business model and want to
establish that they have been through at least
one economic cycle.

Typically, property cycles are 7 years in the UK
and therefore a provider that has over a decade
of experience and is still successfully in
business, has traded through the boom-and-
bust cycle. They have demonstrated they can
weather the storm.

Track record is the most important part of due
diligence, past performance over a 10-year
period demonstrates that the corporation has
achieved these results previously. The results
for a loan note come in 2 guises.

   •   The coupon payment has been paid as
       agreed, on time and with no late delivery
   •   The principal capital has been returned
       on time and in full

Capital 3PM also insists on seeing this
evidenced in the form of an official signed off
document by the Directors of the
corporation, stating that they have never
defaulted on any Loan Note obligations.

As with all due diligence we always insist
upon all documents and statements to be
signed, dated, stamped and validated.

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At Capital 3PM, all our Loan Note providers have long standing relationships with us, are well
renowned and respected business professionals in their field and have a strong reputation in
their industry. Our providers have a highly experienced and diverse board of directors and
investment committee process with corporate values that have stood the test of time.
The board will have hundreds of years of combined experience, both in corporate and
entrepreneurial worlds.

The jurisdiction where the investment is both held, in terms of banking, and the underlying asset
is of importance. The standards of corporate governance are critical to where we invest and
engage in business. Onshore banking presence is also a key factor in our due diligence process,
corporations must have a mainland bank account with solid history and standing. Regulation in
these jurisdictions provide additional security for our investors.

We like simple businesses where it is very easy to understand what they do, the business model,
plan and projects they require capital for. It is transparent and logical how they can justify the
coupon payments based on the margins their model and strategy create.

Security is the final due diligence required to be in place. If we are not secured by legal charges,
debentures and contractual obligations, all of which are administered by a regulated security
trustee, all of the above due diligence will have no meaning or value.

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The Number 1 Fixed Income Investment
Product for 2021
At Capital 3PM, we have designed the Number 1 Fixed Income Investment opportunity for 2021.

Benefitting from our strict due diligence criteria, this fixed income investment opportunity is a
fully secured and asset backed vehicle.

It is independently overseen by a UK Regulated Security Trustee, with the sole responsibility to
act in the investors best interest.

This exclusive investment opportunity offers fixed rates between 8 to 12% P.A with a low entry
point of 5,000 GBP, USD or EUR, which allows both sophisticated and first time investors to take
advantage of this investment product and diversify and grow their portfolio’s.

The fixed income product also offers a short term of between 12 and 36 months, helping our
investors realise a fixed return in a fixed time frame.

The investment opportunity also offers a genuine hedge against market volatility by investing in
the following sectors:

      • UK Real Estate
      • UK Commercial Real Estate
      • Litigation Finance
      • Rated Listed Bonds
      • Ethical Opportunities
      • Fixed Income
      • Metals Mining
      • Direct Property
 All of the above sectors offer unparalleled growth opportunities and undergo a rigorous
    screening process to ensure that we only select products for the investment portfolio that
       have a 100% track record of delivering both coupon and principle capital upon maturity,
          as well as a minimum of $1BN of assets under management.

               What is most re-assuring is that for this exclusive investment opportunity, we have
                selected products that have over $3BN of assets under management to further
                   mitigate against any foreseeable or potential risks.

                          Capital 3PM are committed to maintaining the highest level of moral
                            and ethical standards, and have a track record of 17 years of
                               continuously outperforming our competition by providing leading
                                  products with all of the benefits offered by this product.

                                       Book a call now with one of our team of experts

                                                        Book A Call Now

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About Us:
Capital 3PM have nearly two decades of experience in
raising capital worldwide. We have an established distribution
network that spans both the institutional and retail space.
Our capital raising encompasses both equity and debt.

On the equity side, we can engage with an audience that has
been familiar to us for the last 17 years and has supported
our clients extensively in their equity raising objectives.
When it comes to debt, we have worked with the world’s
largest financial institutions and have been involved in
all aspects of debt requirements. To date we have a
track record of 100% success in delivering our clients capital
raising objectives.

Adam Davis, Managing Partner of Capital 3PM has been
working in the investment market for almost 2 decades.
He has held board level positions in telecoms, energy, property and the investment sector.

In 2014, Singapore state owned investment fund, Temasek Holdings acquired the portfolio of
assets that Adam had helped build and raised capital for since 2008. Adam took a start up from an
embryonic stage to a portfolio that was acquired for $559 Million by the Singapore state.

After introducing capital to fund managers and asset managers for many years, as well as
developing a "black book" of resources he formed Capital 3PM. Capital 3PM now advises UK and
Europe's most prolific asset managers on how to raise capital in the overseas capital markets.
Capital 3PM also provides Private Clients with a suite of Fixed Income non-market correlated
opportunities.

Capital 3PM have advised clients on fund creation and architecture, regulatory issues and
constraints, equity and debt raising, prospective seed investment, business planning, partnership
relationships, global marketing and distribution and potential growth and development planning.

Why Book A Call With
Capital 3PM?
Our mission is to introduce alternative financial
strategies while providing unsurpassed service
excellence, that together deliver measurable
value to our clients.

Whether you are a sophisticated investor or
someone who is exploring the options available
to start on your investment journey, we want to
offer you the opportunity to speak to one of our
team of experts so you can find out more about
the range of investment options that are
available to you.

Our team will understand more about your
existing portfolio asset allocation and show you
how fixed income could help you diversify this.

We have a 100% track record of delivery
through our exclusive suite of secured fixed
income investment products that are 100%
asset backed to match a multitude of investor
requirements.

Book a call now with one of our team of experts

           Book A Call Now