American corporate credit specialist Muzinich & Co. has launched a new absolute return Global Tactical Credit Fund to be managed by Mike McEachern.
The Ireland-domiciled Ucits strategy seeks to deliver a target return of Libor plus 5%-7% while protecting capital in falling markets.
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The fund will seek to achieve its target by looking for relative value across rating, duration and geographic spectrums, coupled with rigorous fundamental bottom-up analysis of investment grade and high yield corporate bonds and corporate loans.
In the Ucits-compliant version, McEachern will apply a bottom-up process to locate the best investment opportunities across investment grade, high yield corporate bonds and corporate loans.
It is designed to assess relative value across rating, duration and geographic spectrums.
In addition, McEachern may use portfolio hedging techniques to help reduce short-term volatility during periods of rising interest rates or spread widening.
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By GlobalData"The prospect of rising interest rates has prompted demand for nimble, multi-asset fixed income strategies as a complement to more traditional investments," McEachern said.
"We believe the Global Tactical Credit Fund can deliver meaningful long-term returns throughout a market cycle and crucially, we have the investment flexibility and hedging tools to provide a measure of portfolio protection as we navigate through a period of potentially rising interest rates," he added.
"We can do this by moving in and out of global credit sectors, as well as up and down the credit quality and duration spectrum, as different fixed income assets move in and out of favour."
