Prime Capital AG, an independent asset manager and financial services provider that manages EUR17.2bn across multiple funds, has launched the Liquid Alternative Credit Fund.This new fund of funds will be pooling alternative credit strategies like trade finance and real estate bridge financing. It will invest in 15 to 20 underlying funds which are diversified globally with a target split of around 1/3 in North America, Europe and Rest-of-the-World, respectively.
“These strategies provide – similar to hedge funds – advantageous liquidity in contrast to other forms of private debt. They have strong levels of tangible collateral (eg ~LTV of up to 60 per cent in the Real Estate space). At the same time they provide attractive expected returns, mostly due to underlying complexities. The universe is very fragmented, investments are hard to source and managers have a low level of institutionalisation. The individual funds require a very targeted and carefully coordinated selection”, says Tilo Wendorff, managing director of the Absolute Return team at Prime Capital.
PCAM Liquid Alternative Credit aims for an annual net return of 7-9 per cent with a volatility of approximately 2 per cent. It starts with an initial capital of approximately USD 30 million, based on the subscriptions from three seed investors.
“Our PCAM Liquid Alternative Credit offers institutional investors efficient access to a broad and robust strategy mix with clear return targets,” says Dr Werner Goricki, board member and CIO. “It makes a universe of small niche managers and strategies investable which would otherwise be very hard to invest. PCAM Liquid Alternative Credit is therefore suitable for stabilising and diversifying portfolios with very low beta to the traditional credit market. The fund is another example of our many years of successful expertise in putting together risk-return-optimized portfolios with alternative investments”, Goricki added. Prime Capital’s senior team combines 40-plus years’ experience and has a proven, excellent track-record in Alternative Credit and fund of funds management.
The New Liquid Alternative Credit Fund expands Prime Capital’s absolute return offering and follows the highly successful PCAM Blue Chip and PCAM Select, both focusing on offshore hedge funds.
It has the legal form of a Luxembourg SICAV-RAIF, charges a management fee of 0.5 per cent pa and carries a performance fee.
An investment in Prime Capital Liquid Alternative Credit Fund is reserved for professional investors within the meaning of Annex II of the Directive 2014/65/EU (MiFiD II). The Fund may not be distributed to retail investors within the meaning of Article 4 of the Directive 2014/65/EU (MiFiD II).