We categorize the investment product using the ‘core or underlying’ investment analysis strategy. Full-liquidity ‘core’ includes tradable securities in the financial market such as stocks, bonds, commodities, forex, index, cryptocurrency, and more. These could be packaged into full-liquidity mutual funds issued by major banks and financial institutions, or the limited liquidity hedge funds that are issued by investment strategy fund management companies.
In real estate, the underlying investment could be the real properties, the portfolio of equity, or debt contracts. We see a lot of Real Estate Investment Trusts, or REITs, that distribute cash from rent to investors that acquire the equity share/unit of the REITs, of which the underlying portfolio properties are managed by a professional team. There are also a lot of Mortgage Investment Corporations, or MICs, in the real estate market gaining interest from investors because of strong collateral backup and stable monthly cash flow from mortgage interest.
We categorize the investments based on their liquidity into the primary or secondary market. This definition will apply to both the financial market and the real estate market. We categorize any investment opportunities before full liquidity as contractual investment opportunities that will have no or limited liquidity. Any opportunities in the secondary markets are attached with the tradable product including financial derivatives, and any real tradable properties. To achieve an absolute return, we will concentrate on the primary market by reviewing equity or debt contract opportunities.
Rockbase Capital aims to help our clients achieve an absolute return by holding investment opportunities up to our intensive due diligence standards, which helps mitigate risk. A full-liquidity underlying investment that brings unexpected volatility will temporarily be off-limits. Some of the hedge funds would limit the volatility and in the meantime benefit investors through waving profit. The contract financing opportunities in the real estate primary market sphere will be our target area. Both debt and equity will be considered as our preferences. REITs and MICs are also on our due diligence list since cash distributions and exit gains are consistently beneficial to our clients.