Collins Capital’s Long/Short Credit Fund (CCLIX/CLCAX), a mutual fund offering a true long/short credit strategy that dynamically adjusts exposure throughout the credit cycle, has passed its one year anniversary.
"We are very pleased with how well the Fund protected capital for clients and outperformed during this tumultuous fixed income environment," says Dorothy Weaver, Co-Founder, Chief Executive Officer and Chief Investment Officer of Collins Capital. "After years of wide open credit markets, suppressed volatility, low interest rates, and the tide essentially lifting all boats, the high yield market has quickly reversed course and we are finally starting to see fundamentals matter again. Spurred by the recent turmoil in energy and commodities, a significant sell-off has resulted in very compelling opportunities for highly-skilled and experienced credit pickers who can correctly identify the winners and losers. We believe that we are entering one of the most fertile environments we have seen in a long time, in which employing a conservative and dynamic approach to credit can be rewarded."
The Fund's sub-advisor, Pinebank Asset Management, LP, manages a portfolio of generally between 20 and 50 investments by combining an in-depth understanding of credit cycles and market liquidity along with bottom-up and event-driven credit selection. Pinebank maintains the flexibility to adjust the portfolio's net long and short exposures in different market environments, with the goals of seeking downside protection for investors and of generating positive returns independent of market direction.
"I have been intimately involved in the credit markets for the past 25 years and believe we are currently in one of the most opportune environments I have seen," says Oren M Cohen, Chief Investment Officer and Head Portfolio Manager of Pinebank, who has managed the strategy since 2004. "We are at the point in the credit cycle where dispersion has increased significantly, long-only beta is no longer rewarded and a long/short approach to credit-picking can shine. In this environment, we believe the best positioning is to keep duration low and maintain higher cash balances to attempt to take advantage of the many and various opportunities presented by the currently volatile and illiquid credit markets."
