Lyxor Asset Management has partnered with Wells Fargo Asset Management (WFAM) to launch the Lyxor/Wells Capital Financial Credit Fund, adding a credit specialist to its alternative UCITS platform.
The fund concentrates primarily on fixed income credit instruments of global financial sector companies, with a European focus.
The strategy invests across the capital structure of financial companies including senior, subordinated and contingent convertible bonds while hedging currency risk.
The investment philosophy is based on the conviction that fundamental credit research, combined with active asset allocation within a risk controlled framework, has the potential to generate sustainable returns over the long term.
The global high yield financial bond sector has become a significant standalone asset class, with expected issuance volumes of approximately EUR230 billion over the next five years. Due to the greater oversight, stricter regulation and liquidity constraints imposed on the financial sector, high-yielding financial bonds offer an attractive risk-return profile compared to corporate bonds. Gaining exposure to high-yield financial bonds, which are expected to exhibit a relatively low correlation to high-yield corporate bonds, allows investors to diversify their sources of potential fixed income returns.
The investment team is led by Satish Pulle (pictured), a senior portfolio manager at ECM Asset Management, part of WFAM, who has 20 years industry experience. ECM Asset Management has an experienced global credit team based in London, which is further supported by the 33-strong WFAM global credit research team, covering all key credit sectors globally.
The fund, which is now passported into 12 countries, is available on Lyxor’s Alternative UCITS Platform for a minimum subscription amount of USD10,000 and EUR10,000. Not all share classes are available or registered for sale in all jurisdictions.
WFAM becomes the 11th fund on Lyxor’s EUR2.6 billion Alternative UCITS platform.
