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MULTI-STRATEGY CREDIT

Our best global credit investments, with a focus on the downside.

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By combining global, high-conviction credit selection with defensive trades, we aim to generate strong capital returns and an attractive level of income.

Fraser Lundie

Head of Credit

Truly global

We exploit opportunities across the ratings spectrum in the US, Europe and emerging markets.

Downside defence

We strive to shield our return-seeking positions using an array of trades with the potential to reduce losses.

High-conviction security selection

We seek robust capital returns and an attractive, consistent yield.

Quality income

Global, high-conviction, long-only positions balanced by defensive trades helps to achieve a high level income.

Experienced team

A skilled, integrated team whose principal members have worked together since 2004.

ESG integration

Propriety analytical tools and engagement help us ESG risks and deliver sustainable returns.

Investment approach

Exposure to the team’s best long-only credit investments, combined with strategies that defend against market volatility, should generate positive absolute returns through the cycle. In seeking to achieve this, the fund is split into two Multi-Strategy Credit buckets:

  • Best selection: high-conviction, long-only investments in corporate bonds, loans, convertible bonds and derivatives comprising two-thirds of the portfolio.
  • Defensive: a range of bearish strategies, accounting for one-third of the portfolio, that aim to defend against market falls.

Identifying outperforming credit investments requires a broad mandate. The team researches the US, Europe and the emerging markets to exploit differences in the valuation and return prospects of securities.
Crucially, this universe enables them to avoid chronically overvalued sectors and access better liquidity.

Finding a good credit name, however, is not enough. The team believes that security selection is equally as important as issuer selection, given the varying risks and return potential of different securities within each issuer’s capital structure. Exploiting such relative value is core to generating positive returns.

Defensive trades, which include outright short, curve and capital structure trades, aim to defend the portfolio’s performance in down markets.

Team

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Related Insights

Weekly Credit Insight
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Credit Pulse: market update - 12 February 2021
What are our views on fixed income markets for the next coming months? How does the team prepare for the different possible outcomes?
Weekly Credit Insight: hybrid is the new black
Chart of the week: hybrid is the new black
Credit Pulse: market update - 15 January 2021
How does the fixed-income team at the international business of Federated Hermes see this year shaping up?

Sales Contacts

Jakob Nilsson,
Executive Director - Head of Distribution, Asia Pacific
Alex Ng,
Director - Distribution, Asia Pacific
Mark Coppell,
Director - Distribution, Asia Pacific
Byung-Hoon Choi,
Director - Distribution, Korea
Tai Watanabe,
Manager - Distribution, Japan