Oclaner Asset Management aims to gather between $250 million to $300 million in assets for its Asian Bond fund over the medium term.
Citywire A-rated Olivier Spoor said the Oclaner Asian Bond fund currently has $85 million in assets and is on a steady growth path to reach in excess of $100 million in assets by year-end.
The Oclaner Asian Bond fund invests in Asian bonds denominated in US dollar and sits in the Asia Pacific Hard Currency peer group.
The fund, which returned 17.6% net of fees for its investors over the past three years, ranks in the top decile for risk-adjusted performance over the period.
Spoor said the fund’s bottom up research and bond picking has paid off on the high yield segment as the fund managed to identify improving credit stories and companies with leeway to turn around their financial stress.
Meanwhile, Oclaner has kept the duration of the fund short compared to the market, which also contributed positively to performance.
Spoor, who manages the Oclaner Asian Bond fund, said he is closely monitoring the US interest rate curve, as well as the risks pertaining the Asian credit market.
Among the risks it is monitoring include the dry up of liquidity in the Asian credit market, emerging markets outflows, as well as Asian foreign exchange weakness and spread widening, particularly for beta sectors such as the Chinese property, and countries like Indonesia.
‘We remain defensive in both duration and credit quality as long as interest rate have not stabilised and the supply of new bonds has not dried up,’ Spoor said.
‘In the meantime, we look for asymmetric payoffs in special situations or convertible bonds,’ he said.
The Oclaner Asian Bond fund is a core fund to access the Asian fixed income market and is available to high net worth individuals and family offices.
The fund aims to preserve capital while providing steady returns by following a non-benchmarked active strategy. The fund invests in short dated high yield bonds as well as longer dated investment grade bonds.
This blended portfolio allocation generates a smoother return profile than most other funds which invest solely in investment grade or high yield bonds.
As the fund has a low market footprint, it can be much more nimble than bigger funds.