RHM’s investment objective is to provide investors with an attractive level of regular and growing income and capital returns from investment primarily in high quality music intellectual property. To achieve this objective, it seeks to invest in a songwriter’s copyright interest in a musical composition or song, together with the rights in the recording of these (known as the master recording rights), along with all other rights and assets considered relevant by the manager.
Since its 13 November 2020 launch, Round Hill Music Royalty Fund’s (RHMRF) NAV has returned c 17.6% on a total return (TR) basis and 11.1% annualised (to end-May 2022 in US dollars), slightly above the targeted annualised NAV TR of 9–11%. An increase in economic NAV to $1.11/share (from $0.98 per share at launch; not an IFRS measure) and dividends contributed to the NAV TR. The RHMRF portfolio is valued using an 8.5% discount rate, still reasonably conservative despite rising interest rates. RHMRF benefits from the industry expertise of its fund manager Round Hill Music LP, a fully integrated business, in owning and exploiting music copyright assets. We believe RHMRF’s assets will continue to expand, providing reliable and growing revenues given the momentum in streaming and the potential of new distribution channels.