Stake Accumulate

What Stake Accumulate is

Stake Accumulate is a managed fund that aims to provide a consistent return 2% p.a. above the RBA cash rate. Although the target return may not always be achieved, the product has features designed to improve the consistency of returns. Other key features of the fund include the opportunity to reinvest your earnings, and the ability to add or withdraw money daily. This fund operates in AUD and the minimum initial investment amount is $500. The value of your investment is subject to market movement in the fund's assets and can go down as well as up. Read the PDS for more.

How this managed fund works

Stake Accumulate operates as an Australian unit trust, meaning investors’ money is pooled together and managed according to the fund’s investment strategy and objectives. Each unit represents an equal share in the fund's net assets and income. Rather than having to buy whole units, you can invest any dollar amount (with an initial minimum of $500) into Stake Accumulate – similar to how fractional shares work. In technical terms, investors are unitholders; they can apply for (buy) and redeem (sell) units.

K2 Asset Management Ltd is the fund’s responsible entity, while GF Asset Management Pty Ltd has been appointed by Stake to manage the investment strategy. Apex Pty Ltd is the administrator and custodian of the fund and Xcend Pty Ltd provides unit registry services. The Stake Accumulate Fund is an ASIC Registered Managed Investment Scheme with ARSN 680 653 374.

The fund has a dual unit class structure: Class A is available to retail customers, and benefits from product features intended to improve the consistency of your earnings. Class B capital is provided by Stake/wholesale investors, and forms a Limited Income Buffer that aims to prioritise Class A’s target return. See below and read the PDS for more. 

How Class A’s target return is prioritised

Income Priority 

Class A has priority entitlement to any income earned by the fund, up to and including the target return of 2% p.a. above the RBA cash rate. Once Class A’s target return has been met, any additional income is distributed to Class B. This is generally called ‘Income Priority’. 

Limited Income Buffer 

Any shortfall in meeting the target return of Class A will be made up from any available Class B capital – this is referred to as the Limited Income Buffer. There may be times when the available Class B capital is insufficient to make up the shortfall in earnings, and in such cases the distribution to Class A will be less than the target return. 

Any additional income above the target return in a relevant distribution period will be allocated to Class B, effectively increasing the available capital to use for the Limited Income Buffer.

To get a comprehensive understanding of these features, please read the PDS.

How the money in Accumulate gets invested

Stake Accumulate invests in Australian and global fixed income securities and other debt instruments, and may include some exposure to illiquid investments such as private credit. The fund has the flexibility to use derivatives, short selling and leverage for the purposes of hedging or increasing investment exposure.

The portfolio is managed with the objective of consistently delivering the target return of 2% p.a. above the RBA cash rate. Investment decisions are made based on macroeconomic and company- or sector-specific views, to capture yield and exploit various inefficiencies across global fixed income and credit markets. Read the PDS for more.How earnings are calculated and paid

The fund's net asset value (NAV) is calculated each business day based on the market value of its underlying assets, less any fund liabilities (such as fees and expenses). Exchange-traded assets are valued based on the last traded price each business day, while any unlisted assets are valued in accordance with the Investment Manager's valuation policy – a copy of which can be provided by Stake on request.

Your earnings are calculated daily (each business day). Every month, by default, they’re reinvested in the fund. If you choose to turn off automatic reinvestment, your monthly distribution will instead be paid to your AUD balance.

It’s also worth noting that the fund aims to achieve the target return after fees, expenses and costs. Read the PDS for more.

How this might fit a wider strategy

Stake Accumulate offers investors a simple and effective way to invest with a target return up to the RBA cash rate + 2% p.a., while maintaining easy access to their money. The suggested minimum investment time frame is three months.

The fund aims to provide consistent monthly distributions through typical business and market cycles. 

Stake Accumulate may also be able to improve the diversification of a portfolio consisting of shares.

However, investors should consider their individual risk tolerance and financial goals to determine whether Stake Accumulate is suitable for them – and if so, the best way to incorporate it into their investment strategy.

Stella Ong

Markets Analyst

Stella is a markets analyst and writer with almost a decade of investing experience. With a Masters in Accounting from the University of Sydney, she specialises in financial statement analysis and financial modelling. Previously, she worked as an equity analyst at Australian finance start-up, Simply Wall St, where she took charge of the market insights newsletter sent out to over a million subscribers. At Stake, Stella has been key to producing the weekly Wrap articles and social media content.