Last updated: December 30, 2024
How has Wealthsimple Private Credit performed?
Total Return: 17.1%1
Total Return (annualized)1 : 11.1%
Distribution Yield2 : 9.0%
| January | February | March | April | May | June | July | August | September | October | November | December | Total | ||
| Total Return | 2023 | 0.3%3 | 0.9% | 1.3% | 2.1% | -0.9% | 1.5% | 1.6% | 7.0% | |||||
| 2024 | 0.8% | 0.9% | 0.9% | 1.2% | 1.1% | 0.2% | 0.6% | 0.6% | 1.0% | 0.9% | 0.8% | 9.4% | ||
| Distributions per share | 2023 | $0.2265 | $.077 | $.077 | $0.122 | $0.503 | ||||||||
| 2024 | $.077 | $.077 | $.077 | $.077 | $.077 | $.077 | $.077 | $.077 | $.077 | $.077 | $.077 | $0.770 | ||
| NAV per share | 2023 | $10.03 | $10.12 | $10.26 | $10.25 | $10.08 | $10.15 | $10.19 | ||||||
| 2024 | $10.20 | $10.21 | $10.22 | $10.26 | $10.30 | $10.24 | $10.23 | $10.23 | $10.25 | $10.26 | $10.27 |
Since the fund's inception in June 2023, returns have been 17.1% net of fees.1 That is on the high end of long-term expectations and includes both distributions and increases in the value of the fund.
The fund distributed $0.077/share in income, representing a 9.0% annualized distribution yield.3 All loans in the portfolio are currently performing as expected.
What do these numbers mean?
The yield generally consists of interest payments paid by borrowers. You can think of them almost like dividend payments issued to stockholders. In the case of the Wealthsimple Private Credit Fund, it distributed $0.077 / share in November, which was 0.8% of the fund’s starting value of $10.26. We calculate the yield as if it were paid in each period to quote it on an annualized basis by multiplying it by 12, which indicates an annualized yield of 9.0%. Annualizing is generally the market convention for quoting the yield of financial assets.
The fund value is the market price, or “fair value,” of the loans and any other assets in the fund (e.g. interest that is accrued but not distributed to shareholders). This is similar to owning a stock: its value changes as the market goes up and down.
Notes:
1 The total return is made up of: (i) the change in value of the loan that made up the fund (NAV per share), and (ii) income paid to investors in the form of distributions from each period, with the distribution reinvested. Annualizing the total return is to take the geometric annual average of the total return. Returns shown include all applicable fund management fees and performance fees, but excludes Wealthsimple's standard management fees for its advisory services. Past performance does not guarantee future results.
2 Annualized distribution yield based on $0.077/share, divided by a starting NAV of $10.26, and multiplied by 12. To calculate this rate, we take a partial year distribution and convert it to a full-year amount as if it were paid in each period. We then divide this annualized amount by the fund's value at the start of the period. Distributions are not guaranteed. Past performance does not guarantee future results.
3 The fund was substantially invested in cash for the month of June as the portfolio was established.
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