The Fund predominantly provides exposure to a wide range of domestic and global investment grade floating and fixed rate instruments, asset-backed securities, and cash.

Benefits of investing in the Macquarie Income Opportunities Fund

• Potential for regular income.
• Potential to deliver returns in different market conditions using a defensive, yet flexible, strategy with a focus on capital preservation.
• Potential for higher returns than traditional cash investments.
• Provides potential diversification against equity risk.
• Access to the investment management expertise of Macquarie Investment Management and other leading fixed interest managers around the world.

The Fund may be suitable for investors who are looking for an investment with the objective of the Fund and are prepared to accept the risks of the Fund set out in Section 4 of the PDS.

Fund description

The Fund provides exposure to a wide range of Australian credit-based securities (predominantly floating and fixed rate corporate bonds, and asset-backed securities) and cash. The Fund may also have exposure to global investment grade credit securities, global high yield credit securities, emerging market debt, hybrid securities and a range of other credit opportunities when they are expected to outperform and reduce exposure to these sectors when they are expected to underperform.

Generally, exposure will be to floating rate notes. The Fund may also have exposure to fixed rate notes with the interest rate risk hedged out through the use of derivatives such as swaps and futures.

Significant features

• Provides exposure to a diversified portfolio of credit-based investments.
• Actively identifies outperforming credit sectors.
• Minimises currency volatility through hedging.

How we invest your money

Investment process

The investment process aims to reduce the risk of the Fund being adversely affected by unexpected events or downgrades in the credit rating of the Fund's investments. A disciplined framework is used to analyse each sector and proposed investment to assess its risk.

The Fund gains exposure to securities either directly or through funds managed by a member of the Macquarie Group and external managers. This gives Australian investors access to leading fixed interest managers around the world. Managers are selected and continually reviewed using a rigorous process that draws upon the resources and skills of all aspects of the Investment Manager's operations.

Asset allocation

• Cash, fixed income and credit-based securities: 20% - 100%

• Hybrid securities: 0% - 10%

• Global investment grade credit securities: 0% - 40%

• Global high yield credit securities: 0% - 15%

• Emerging market debt securities: 0% - 15%

• Credit opportunities: 0% - 20%

The Fund may be exposed to derivatives to implement its investment strategy. For example, protection may be purchased on issuers that are believed to be over-valued or at risk of downgrade. These positions increase in value when the underlying instrument falls in value and decrease in value when the underlying instrument rises in value.

The portfolio is generally hedged to Australian dollars.