How Impact Capital Funds Fit in Your Portfolio

Are you the decision-maker for a Family Office, Endowment, Foundation, or Religious Organization?

A Different Profit-driver

Impact Capital Funds does not profit from the interest rate charged for its loans. In fact, we pay out more to our investors than we charge on our loan portfolio. We effectively pass through all loan interest to our investors. Instead, we are organized fundamentally as an investment management company that profits primarily from the 1.25% advisory fee we charge on total assets under management. Therefore, our incentive is to rapidly grow our AUM by offering a compelling, low-interest rate on our refinance loans, and to promote our unique mission to disrupt student loan rates, while generating potential college scholarships through investment performance.

Alternative Fixed Income, with Social Impact

Our Unique Mission

According to the Global Impact Investment Network 2019 annual report, over $500 billion has been allocated globally to impact investments. Yet, we know of no Impact Investment Loan Fund with a Triple Bottom Line like ours:

Delivering bond-like returns to mission-driven institutional investors, with modest upside.
Issuing below-market rate loans to refinance the high cost debt of creditworthy college graduates.
Generating potential tuition scholarships at participating universities for first generation college students with financial need.

Low or No Correlation

55% -75% of the Fund portfolio is invested in refinanced student loans for graduates who are creditworthy. According to data from Lending Club, the largest issuer of unsecured personal loans, such loans have a near-zero correlation with all asset classes. This provides a strong diversification benefit in a portfolio.

Correlations of Prime Unsecured Loans with other asset classes: 2009-2018

  Prime Unsecured Loans United States Treasuries Aggregate Bond Index Corp bonds Inv Grade High Yield Bonds Mortgage Bonds US Stocks International Stocks
Prime Unsecured Loans                
United States Treasuries 0.07              
Aggregate Bond Index -0.06 0.89            
Corp bonds Inv Grade -0.10 0.47 0.80          
High Yield Bonds -0.20 -0.26 0.15 0.59        
Mortgage Bonds -0.11 -0.79 0.90 0.59 0.07      
US Stocks 0.06 -0.27 -0.06 0.23 0.63 -0.14    
International Stocks -0.03 -0.24 0.05 0.40 0.75 -0.03 0.87  

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