UK investment manager Schroders has unveiled a new liquid distressed fund, which aims to tap opportunities in corporate credit and equities.
Dubbed as the Schroder GAIA II NGA Turnaround fund, the new vehicle will sit on the firm’s GAIA II alternative investment platform and will be externally managed by New Generation Advisors (NGA),
Go deeper with GlobalData
Access deeper industry intelligence
Experience unmatched clarity with a single platform that combines unique data, AI, and human expertise.
GAIA II platform is a liquid alternatives platform for externally managed strategies. George Putnam III, founder of NGA, will act as a lead manager on the fund.
The fund aims to invest in corporate credit and equity securities through fundamentally-driven long and short positions, mainly in North America.
The Turnaround fund, which is benchmark unconstrained, will deliver clients a liquid alternative strategy that is uncorrelated to traditional equity and bond markets to provide portfolio diversification. It will generate annual net returns of 8-12%, with 10-12% volatility.
The new strategy will capitalise on inefficiencies that exist in the distressed securities market due to lack of understanding of the bankruptcy process and maximise returns from bankruptcies, distressed companies and turnaround situations.
US Tariffs are shifting - will you react or anticipate?
Don’t let policy changes catch you off guard. Stay proactive with real-time data and expert analysis.
By GlobalDataSchroders currently has seven funds on the GAIA platform, six managed by external hedge fund managers and one managed internally.
Schroders director of GAIA platform Eric Bertrand said: "We’re delighted to launch the first fund on the Gaia II platform with such a high-quality hedge fund manager who has one of the longest, most successful track records in the industry.
"This is an opportune time to be launching a distressed investment strategy to further widen the range of strategies across both Gaia platforms."
Putnam said: "However, even if the next big wave of defaults is slow to arrive, distressed opportunities always exist because, even in the best of times, some businesses manage to make mistakes, and we are well positioned to take advantage of these opportunities."
