ECM AM launches absolute return credit fund

ECM Asset Management has launched an absolute return fund focused on the European credit market as it attempts to tap into the deleveraging credit cycle.

The main objective of the Luxembourg-domiciled ECM Absolute Return Credit Fund will be to preserve capital, as well as aiming to return Euribor +4% per annum net of fees.

The majority of the fund will be invested in the European credit market, although there is an opportunity to invest across global credit markets where applicable.

It will be co-run by fund manager Derek Hynes and the company’s co-CIO Ross Pamphilon.

Hynes and Pamphilon will adopt directional credit strategies and also use fundamental approaches to the market in order to find specific and systematic investment opportunities.

In addition, the duo will adopt basis trading, pair trading, capital structure relative value and curve trades.

Commenting on the launch, Hynes said: ‘The present market uncertainty presents an opportunity to capture upside, but with lower volatility along with lower correlation to other risk markets. Investors benefit from diversification as returns are derived from multiple sources.’

This marks a new venture for Hynes who was recently replaced as the lead manager on the European Credit Fund Sicav – Danube by former Euro Stars AA-rated manager Jens Vanbrabant.

This occurred after ECM said it believed the fund’s strategy had changed and was more suited to a manager specialised in investment grade credit.