Algebris Investments has launched a credit fund, designed to help investors face the challenge of finding positive yield in high quality assets in the current low yield environment.
The Algebris IG Financial Credit Fund, a sub-fund of Algebris UCITS Funds Plc, will be managed by Sebastiano Pirro, financial credit portfolio manager at Algebris.
The Fund aims to generate an attractive level of income and modest capital appreciation in the medium term by investing predominantly in investment grade securities (rated BBB- or above) issued by Globally Important Financial Institutions (G-SIFIs) and national champions, Algebris said in a note.
We believe this strategy represents a compelling income proposition, with an all investment grade, high quality portfolio," said Davide Serra
Since the Global Financial Crisis, banks have undertaken unprecedented efforts to improve their underlying fundamentals and are now standing on solid capital buffers. Transparency and supervision are unparalleled compared to any other asset class. Strong fundamentals come along with the exclusion of bank debt from global quantitative easing programs which has left valuations untainted by direct central bank policy.
Sebastiano Pirro, fund manager of the Algebris IG Financial Credit Fund, said: "Spreads remain at historical highs compared to the rest of the investment grade fixed income landscape. With the introduction of the Algebris IG Financial Credit Fund, we are looking to leverage our track record and expertise in global financials by taking advantage of a further dislocation in value for bank funding and capital."
Davide Serra, founder and CEO of Algebris Investments, added: "In a scenario where over 30% of global fixed income assets have negative yields, the Algebris IG Financial Credit Fund further enriches our suite of income focused products. We believe this strategy represents a compelling income proposition, with an all investment grade, high quality portfolio."