How Mayfair Platinum Creates an Alignment of Interests with its Investors
  • Mayfair 101

How Mayfair Platinum Creates an Alignment of Interests with its Investors

Updated: Apr 8

Proactive Investors, 24 January 2020

Since the launch of the Mayfair Platinum brand, it has grown considerably both in terms of funds under management and public awareness, raising in excess of $100 million from wholesale investors within its first six months of operation.

With customer security in mind, Mayfair Platinum took an innovative approach to the development of its financial products M+ Fixed Income and M Core Fixed Income and believes that these products allow for a far greater alignment of interests with its investors than traditional alternatives.

Traditional model “broken”

Mayfair 101 Group’s Managing Director James Mawhinney said: “The traditional model in our eyes is broken as it simply protects those who derive an income from the industry via pre-determined fee structures, rather than putting the onus on the Investment Manager to perform to earn their keep.”

Mayfair 101 Group Managing Director, James Mawhinney

One of the fundamental outcomes Mayfair Platinum wanted to achieve when structuring its products was to ensure that the Mayfair 101 Group balance sheet absorbs any losses first rather than its investors.

In most cases, Mayfair 101 Group assets are used to co-invest in opportunities together with investor assets. In the unlikely event that an investment wasn’t to perform as expected, regardless of whether it is co-investing or not, any loss associated with this would impact Mayfair 101’s bottom line and balance sheet first.

Like any other company that issues a fixed income product, the Mayfair 101 Group is obligated to pay its investors their principle and interest regardless of investment performance. This is an obligation that the Group has successfully met since inception.

A potential criticism of this structure is that Mayfair 101 benefits from all the upside once its investors have been paid. However, this is no different to other Australian companies that issue notes of which there are many including Commbank, Virgin Australia, Fortescue and many others.

The Group’s balance sheet has grown significantly over recent years, through the careful construction of a diversified investment portfolio that now spans 10 countries and includes real estate, financial services, business credit and emerging markets.

Furthermore, the M Core Fixed Income product offered by Mayfair Platinum is secured against a pool of assets owned by the Mayfair 101 Group and that security is held for the benefit of its investors.

Competitive fixed interest rates

Considering this first loss structure and the embedded security measures, the fixed interest rates that the Mayfair Platinum products pay are certainly competitive.

Mayfair Platinum has pioneered with its business model and has been successful in creating a strong alignment of interests and an additional level of protection for investors that is otherwise not found in many financial products available on the market today.

It appears Mayfair Platinum has built a solid business which is filling a very evident gap in the financial services industry.

Importantly, they focus on investing in initiatives that have strong social impact, such as their rejuvenation of the Mission Beach community and investments in technology to facilitate trade for small businesses in emerging markets.

» Click here to view the full article on Proactive Investors.

» Click here to learn more about Mayfair Platinum.

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This website is published by Online Investments Pty Ltd (t/a ‘Mayfair 101’) (ABN 981 34 785 890, AFSL Auth. Rep. No. 001 274 568 of Quattro Capital Group Pty Ltd (ABN 88 128 914 965, AFSL 334653)). It is provided by way of general information only, is subject to change, and may not be relied upon by any person. Mayfair 101 is an Australia-based provider of investment and corporate advisory services, including funds management, asset management, capital raising, corporate advisory, mergers and acquisitions advisory, and direct investment, either directly or through members of its corporate group. Mayfair 101’s authority under its appointment by Quattro Capital Group Pty Ltd under the Corporations Act 2001 (Cth) is limited to the provision of financial services to wholesale clients in Australia only, including general (not personal) financial product advice relating to deposit products, foreign exchange contracts, derivatives, interests in managed investment schemes and securities. Mayfair 101 and the members of its corporate group may have a beneficial interest in the financial services and products of that group. Mayfair 101 provides advice in relation to financial products of its corporate group only, and terms, conditions and risks apply in respect of such financial products. Such financial products are not a comprehensive range of all possible investment products, are not bank deposits and (like most investments) may be subject to greater risk of capital loss and negative returns than traditional investment products. Prospective investors are strongly encouraged to seek independent professional legal, financial, accounting, taxation and valuation advice before deciding whether they consider any financial products to be suitable for them, and to request any relevant disclosure documents (such as Product Disclosure Statements and/or Information Memoranda) to ensure that they are fully informed before making any investment decision. Past performance should not be relied on as an indicator of future performance. The financial products offered by Mayfair 101 and its corporate group are available to wholesale clients resident in Australia only. Mayfair 101 does not accept investment from retail clients, non-wholesale clients or residents of countries other than Australia. Mayfair 101 and the members of its corporate group are not deposit-taking institutions in Australia or elsewhere and are not authorised to conduct banking activities under the Banking Act 1959 (Cth).

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