IRVINE, CA—Vertical Capital Income Fund (VCAPX) easily outperformed its benchmark in its first year of operation, with a return of 12.95%, compared with a 2.59% return for the Barclays U.S. Mortgage-Backed Securities (MBS) Index.
“VCAPX is potentially benefiting from a Goldilocks effect,” according to Vertical President Bayard Closser. “The housing market is recovering, but at a pace where lenders are still willing to sell whole mortgage notes at a deep discount. This creates what we believe is a ‘just right’ environment that we believe will continue for at least three more years.”
The fund’s performance from its inception on Dec. 31, 2011 through Dec. 31, 2012 surpassed the results of the index not only at net asset value, but at the fund’s maximum 4.50% sales charge; with the charge, the return for the year was 7.91%. The fund also declared a dividend of 4.81% on an annualized basis (4.59% after the sales charge of 4.50%) for the period ending Sept. 28, 2012, which is when the Vertical Capital Markets Group’s fiscal year ends. Vertical created and manages the VCAPX.
The fund (VCAPX) trades on NASDAQ and is available for a minimum investment of $5,000, or $1,000 for retirement accounts.
VCAPX is a closed-end interval fund that invests in whole mortgage loans and deeds of trust. As a closed-end interval fund, it provides limited liquidity on a quarterly basis. The fund does not use leverage.