Private Credit - Expertly Managed

Currently investors face the challenge of how to achieve robust returns in a volatile market while ensuring diversification and minimizing risk. Traditional investments, including equities, bonds and property are characterized by high volatility and unpredictable returns.
 

Private credit opportunities offer various advantages such as:

• Strong historical returns relative to other fixed income vehicles
• Solid focus on preservation of capital 
• Diversification from most other asset classes
   

Historically these opportunities have been limited mostly to institutional investors largely due to high barrier to entry and long lock-up periods and liquidity constraints. Coral Cove Private Credit AMC aims to solve these problems by offering an investment strategy that is easily accessible, expertly managed and offers competitive returns with liquidity provided with 90 days’ notice.
 

Accessibility and Execution in Private Credit
 

Private credit is recognized for its potential to deliver attractive risk-adjusted returns with diversification benefits. However, individual investors have been largely excluded from this market due to several factors:
 

• High Minimum Investments: Typically, around USD $5 million.
• Long Lock-Up Periods: Often 5-7 years.
• Complexity and Lack of Transparency: Making it difficult for individual investors to evaluate and manage investments.
   

These barriers have left many investors without access to the significant benefits that an investment in private credit can provide.
 

Private Credit – Expertly Managed
 

Coral Cove, in collaboration with Garrington Capital™, has developed a sophisticated approach to private credit investing. The approach emphasizes the importance of high-quality deal origination, deep due diligence, diversification, and transparency.  This conviction supports a thesis that an investment into private credit can offer very attractive risk-adjusted returns.

• A rigorous Selection Process: Garrington CapitalTM meticulously analyzes small to medium sized enterprises (SMEs) in Canada and the United States of America, assessing business models, strategies, and asset values. This process includes determining the liquidation value of assets and securing loans with a first lien on these assets. Each month, the credit underwriting team evaluates up to 100 lending opportunities, selecting only the top 2-3, ensuring high-quality loans are approved (minimizing  risk of defaults).
   
• Diversification and Liquidity: With a portfolio of approximately 100 loans, Coral Cove spreads risk across various borrowers, industries, and geographies. The focus on relatively small and shorter-term loans (primarily under USD 20 million with durations of 6-18 months) provides liquidity, a rare advantage in private credit markets. This allows investors to benefit from monthly liquidity, in contrast to the typical long lock-up periods.
   
• Transparency and Access:  Coral Cove offers potential investors the opportunity to meet anyone in the team and review the investment process, loan portfolio and any other due diligence requirements, ensuring trust and confidence. This commitment to openness ensures that investors are fully informed and comfortable with their investment choices.
   

Enabling Accessibility via the GenTwo Platform
 

Recognizing the need for greater accessibility, Coral Cove along with its partner CAEP, engaged GenTwo to launch the Coral Cove Private Credit AMC. GenTwo plays a crucial role by providing a platform that enables investors access to track the performance of the Coral Cove Private Credit Fund through the issuance of a certified note with a Swiss ISIN code. This innovative structure allows investors to purchase the investment through their bank or multiple brokerage firms, just like any other security.

An important step forward
 

Toreigh Stuart, Managing Director of Coral Cove, commented: “Having a Swiss-issued ISIN and being able to buy or sell this via your bank or broker, as you would any other security, is an important step forward in creating broader access to our private credit strategy,” he explains. “The CAEP team and the platform provider GenTwo have worked very hard, and we are excited to be working with them on this and other innovative projects.”

Stephen Pratt, CEO of CAEP Asset Managers, agrees: “We know that having a robust investment strategy is paramount to a long-term successful relationship with a client. However, if investors are not able to conveniently access the underlying strategy, there will be limits to the strategy’s growth and distribution thereof The Coral Cove Private Credit AMC is the ideal product onramp for qualified investors to get exposure to a high quality private credit investment, which ordinarily is reserved for select institutional investors”