Strategy overview
Actively managed strategy seeking to generate current income and long-term capital appreciation by investing primarily in equity and junior debt tranches of collateralized loan obligations (CLOs), rated BB or below. The strategy has the ability to invest in high-grade CLOs and other asset-backed securities, looking for opportunities to add alpha where inefficiencies exist.
Our approach
Investment process
- Rigorous fundamental credit research across primary and secondary markets
- Active sector rotation and security selection
- Strategic use of derivatives for risk management
- Focus on CLO equity/junior debt tranches for enhanced income potential
- Opportunistic investments in Agency-Backed Securities (ABS), Collateralized-Mortgage-Backed Securities (CMBS), and Residential Mortgage-Backed Securities (RMBS)
Our competitive advantage
- Robust Investment process – centered around clear product design and cohesive portfolio construction framework, integrates top-down and bottom-up inputs and deep credit underwriting
- Experienced team with global presence – Embedded within the wider BlueBay ecosystem including the CLO management group, an active CLO issuance platform in both the U.S. and Europe
- Active management – Aims to efficiently allocate capital across sectors regions, ratings and primary versus secondary markets, focusing on what we believe are the best bonds from a risk-adjusted perspective
- Sourcing – Strong market connectivity helps to identify what we believe are the most attractive opportunities in both the U.S. and Europe