Longchamp Solferino Credit Fund
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Strategy Overview
The objective of the Longchamp Solferino Credit Fund (the “Sub-Fund”) is to deliver an annualized performance net of fees higher than that of the €STR capitalized + 8.5bps + 2% over a recommended investment period of 2 years minimum.
The investment strategy is focused on the European bond markets with a “Value” approach, that is to say an approach aiming to identify and invest in securities which the Investment Manager estimates are undervalued and presenting, based on its analysis, attractive characteristics in terms of yield and potential for capital gains. This bottom-up approach is also combined with macro analysis aimed at determining the portfolio’s positioning over the course of the credit cycle and establishing a “top-down” view of the portfolio’s risk level.
The combination of these two “top-down” and “bottom-up” approaches gives the Investment Manager the flexibility to considerably reduce its credit exposure in the absence of conviction opportunities and to then allocate to defensive supports such as sovereign bonds.
- Apply a Private Market approach to listed Credit Market with a disciplined value approach Buy as if you held to maturity
- Leverage the unique total return opportunities from tradable credit actively monetize gains of re pricing of risk and exit fundamental underperformers
- High Conviction approach with a concentrated portfolio (25-35 positions with 3%-7% weighting)
- High Yield returns (7%-10%) with Investment Grade volatility (3%-6%)
- Attractive Sharpe Ratio Target (1.5 +) in line with what has been historically accomplished Aim to minimize drawdowns at 5%. Volatility should be limited in most market environments except in deep financial crisis
- Issuers domiciled mainly in Europe
Funds Facts
Legal Structure:
UCITS Sub-Fund
SICAV
Longchamp SICAV
Investment Manager:
Longchamp Asset Management SAS
Domicile:
France
Base Currency:
EUR
Net Asset Value Frequency:
Weekly
Dealing Deadline (Subscription):
12 midday Paris time 1 Business Days prior to the relevant Dealing Day
Dealing Deadline (Redemption):
12 midday Paris time 5 Business Days prior to the relevant Dealing Day
Settlement Date (Subscription):
Within 3 Business Days after the relevant Dealing Day
Settlement Date (Redemption):
Within 3 Business Days after the relevant Dealing Day
Share I1C | fr0013442597
Performance as of 2023-09-29
NAV
1 039,95 €
YTD
+1,33%
MTD
+0,80%
3 YEARS
+13,68%
LTD
+4,00%
Past performance is not an indicator of future performance.
Informations
Strategy
- High Yield Credit
Benchmark
- The net annualized performance of the Sub-Fund can be compared to:
o €STR capitalized + 8.5bps + 2% for the share I
o €STR capitalized + 8.5bps + 1.5% for the share R
Investment process
- Return construction coming cumulatively from income carry and capital gains
- Careful security selection among the highest yield securities in the liquid credit universe
- Use seniority of credit to increase portfolio concentration
- Disciplined Capital Deployment: maximize return on risks taken, paying strong attention to drawdowns
- Full flexibility in risk allocation. Value approach uses sell-offs as opportunities
Philosophy
- Credit markets are cyclical and mean-reverting
- Technical factors can drive pricing away from fundamentals
- Persistent inefficiencies can be exploited through disciplined money management and bottom-up issue selection
Key Professionals
Jean Fau
Credit Fund Manager
Jean has 25 years of experience in capital markets and joined Longchamp Asset Management in September 2019 to lead Credit Strategies and manage the Credit Value Fund.
His career started in 1994 at Goldman Sachs, taking various responsibilities in Convertible Bonds and Equity Derivatives, gaining close exposure to relative value and credit hedge funds. In 2003, Jean joined Susquehanna International as a Portfolio Manager, responsible for European Discretionary Investments across credit, convertible and event-driven strategies. In 2009 Jean left to launch Brennus Asset Management LLP, a London-based alternative investments manager, focused on convertible bonds and other hybrid credit instruments, using a mix of directional and relative value strategies. Before joining Longchamp Jean was a Partner and Senior Portfolio Manager at Chenavari Credit Partners from December 2014 until April 2018, where he ran High Yield, Financials and Convertible Bonds strategies across all mandates. Jean holds a master’s degree in Business Administration from HEC Paris, France.
David Armstrong
President – Managing Director
David is Chief Executive Officer at Longchamp Asset Management, which he founded in 2013. Previously, he was a Managing Director at Morgan Stanley & Co. International Plc, heading the investment bank’s Funds and Fund Linked business globally. In particular, he was in charge of the FundLogic UCITS Platform and served as President of the French asset management company, FundLogic SAS. Prior to joining Morgan Stanley, David had spent fourteen years within the Global Equity and Derivatives Solutions division at Société Générale. After joining the group in Paris, David moved to Milan to head the global capital markets operations including all Equity and Fixed Income activities. He also chaired the Italian alternative asset management company, Lyxor SGR. Thereafter, he moved to New York to head up Structured Products Sales for the Americas. David holds a master’s degree in Business Administration from EDHEC, Lille, France.
Lorenc Golemi
Head of Financial Engineering and Chief Risk Officer
Lorenc is the Chief Risk Officer at Longchamp AM. Before joining Longchamp AM, Lorenc worked in consultancy and advisory in investment banking and asset management. Previously he worked as Portfolio Manager, Risk Manager and Financial Engineer at UBS AM, CommerzBank and Dresdner Kleinwort Benson. He was in charge of systematic strategies and risk management of volatility and absolute return funds. Lorenc holds an Engineer degree in computer science and a master’s degree in applied mathematics.
Thibault Bourgeois
Junior Portfolio Manager
Thibault is Junior Portfolio Manager at Longchamp AM. Previously, he was in charge of the sales and structuration of investment solutions for institutional clients at Nexo Capital. Before that, Thibault had experiences at ERAAM in the multi-management hedge funds selection and sales teams and at Amundi in the Institutional Portfolio Management team. Thibault holds a BSc. Actuarial Mathematics/Finance from Concordia University (CA) and a Master in Management from ESCP Business School (FR).
Shares
Investor profil | Currency | ISIN | BBG Code | Inception | Mgmt Fee | Perf Fee |
|---|---|---|---|---|---|---|
Share I1C * | EUR | FR0013442597 | LONSOLI FP | 31.01.2020 | 1.00% | 10% |
Share I2C | EUR | FR0013518123 | LONSOLC FP | – | 1.00% | 10% |
Share I1D | EUR | FR0013518131 | LONSOLD FP | 15.07.2020 | 1.00% | 10% |
Share R | EUR | FR0013442605 | LONSOLR FP | – | 1.50% | 10% |