Alma MidOcean Absolute Return Credit
Overview
Alma MidOcean Absolute Return Credit employs an absolute return long/short approach to investing in liquid high-yield bonds.
The fund’s management is delegated to MidOcean Partners.
Share Class
NAV
Cumulative Performance (%)
Fund Inception 13 January 2016
| Daily | Monthly | Ytd | 1Yr | 3Yr | 5Yr | Incept. | Incept.Date |
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The performance data shown represents past performance. Past performance is not a guarantee of future results. Current performance may be lower or higher than the performance quoted. The investment return and the principal value of an investment will fluctuate so that an investor’s shares, when redeemed, may be worth more or less than their original cost.
Strategy & Manager
Fund Strategy
The Strategy is designed to capitalise on structural and technical inefficiencies in the liquid credit markets, especially on the short-end of the credit curve. MidOcean deploys a systematic and repeatable credit investing process in low duration credit and relative value trading, paired with tactical hedging, which in combination produce high-yield-like returns with less volatility and more downside protection.
MidOcean typically constructs the portfolio with a net long bias and will seek to dynamically adjust the Fund’s net credit exposure and market exposure to optimise the portfolio’s risk profile given the prevailing market conditions.
Investment Manager
MidOcean Partners is a New York-based alternative asset manager established in 2003 that specializes in middle market private equity and alternative credit investments. MidOcean Credit started in 2009 and manages over $8 billion across a series of alternative credit strategies, collateralized loan obligations (“CLOs”), and customized separately managed accounts.
Key Persons
Ryan Dean
Portfolio Manager, Investment Committee
Ryan Dean is a Portfolio Manager of the MidOcean Absolute Credit Fund and for certain customised credit strategies. Mr. Dean is responsible for daily oversight of the portfolio and actively works with the research team to identify and evaluate absolute return and total return investment opportunities in performing credit situations. He is also a member of the Firm’s Investment Committee. He has covered several industries during his career including Automotive, Aerospace & Defense, Business Services, and Industrials. Mr. Dean has 13 years of experience in the financial services industry predominantly in fixed income credit research and trading. Prior to joining MidOcean Credit Partners in 2013, he was a research analyst in the High Yield Credit Research group at J.P. Morgan where he covered the Industrials and Services sectors. He also was a member of a research team that received #1 for the Services sector and #2 for the Industrials sector by Institutional Investor’s annual All-American High Yield Fixed-Income Research rankings. Mr. Dean received a B.S. in Finance from Lehigh University.
Michael Levitin,
Principal, Portfolio Manager
Michael Levitin is a Portfolio Manager of the MidOcean Absolute Credit Fund and for certain customised credit strategies. Michael is responsible for daily oversight of the portfolio and actively works with the research team to identify and evaluate absolute return and total return investment opportunities in performing credit situations. Prior to joining the firm in 2015, Mr. Levitin was an Associate in the investment bank at Bank of America Merrill Lynch, specializing in originating high yield bonds and loans. Previously, he was a Senior Analyst with MetLife’s distressed investments group.
Statistics & Commentary
Performance
The performance data shown represents past performance. Past performance is not a guarantee of future results. Current performance may be lower or higher than the performance data quoted. The investment return and the principal value of an investment will fluctuate so that an investor's shares, when redeemed, may be worth more or less than their original cost.
Investment Manager's Commentary
as of 30/04/2024Market Review and Outlook
Economic data missed expectations during the month which, coupled with a dovish tone from the Fed, provided a supportive backdrop for rates. The month was further supported by strong earnings (especially from NVDA) and a huge month in primary market activity (the largest in three years). Risk assets across the board saw positive returns with Equities being the strongest performer (particularly the NVDA-led Nasdaq). While the Fund’s long book participated in this rally of risk assets, overall Fund performance lagged owing largely to the short book. US Leveraged Loans (“LL”) continued their steady march higher, producing another month of positive return. US High Yield (“HY”) rebounded with only the second month of the year to have positive price return (+0.59% in May), continuing to be a drag year-to-date. BBs and CCCs both returned +1.23% in the month, with B’s slightly lagging at +0.96%. Of note, distressed CCCs saw a little bit of a bounce, returning +1.69% in the month. BBBs were the big beneficiary of rates, returning +1.93% in the month. Credit spreads widened by 2bps/month in HY and are still 14bps tighter from where we started the year. Loans and Investment Grade tightened by 11 and 3bps in the month, respectively. Yield to worst for HY now sits at 8.04% versus 8.20% last month.
Fund
The Alma Platinum IV MidOcean ARC (the “Fund”) returned 0.31% in May, underperforming the BAML US High Yield Index, which returned 1.13% during the month.
During the month, the Fund saw several positions redeemed as expected, and the investment team reallocated the capital into several new long positions. Looking ahead, the investment team will continue to rotate the Fund’s short book to the best use of capital and will continue to look to uncover off-market and short duration opportunities.
Facts & Documents
Facts
Fund Domicile: Luxembourg
Fund Type: UCITS SICAV
Fund Launch: 13 January 2016
Base Currency: USD
Depositary, Administrator, Transfert Agent: CACEIS Investor Services Bank S.A.
Dealing: Weekly with a 3-day notice
Cut-off time: 3 pm CET
Management Company: Alma Capital Investment Management
Countries where the fund is registered:
Luxembourg, Austria, Germany, France, UK, Italy, Switzerland, Ireland
Sustainability-related disclosures:
Environmental, social and governance (“ESG”) criteria have been integrated in the investment decision-making process. An ESG analysis is conducted for all issuers and a rating is given to each environmental, social or governance consideration relevant to the issuer. This is done prior to any investment, but also on an ongoing basis. Such analysis and rating will be integrated in the investment decision-making process. No index has been designated as a reference benchmark for this sub-fund. Further information can be found in the prospectus of the sub-fund. The extent to which the above-mentioned characteristics are met will be included in the annual report of the fund, as from the first report issued after 1 January 2022.
Identifiers:
I1C-U
ISIN: LU2382212186
Ticker: ALARI1C LX
Launch: 13 Jan 2016
I2C-E
ISIN: LU2382212269
Ticker: ALARCIA LX
Launch: 13 Jan 2016