Private credit might be less attractive than it was last year as investors rush into the market, but there are sweet spots to be found.
Arif Imam is ShakaÆs business manager and is a former managing director at Morgan Stanley, responsible for global distribution of Japanese equities.
The portfolio manager is Alexandre de Bethmann who formerly worked at Federated Global and TIAA-CREF.
ShakaÆs trader is Douglas Butcher, who was also a managing director at Morgan Stanley where he handled client trading for Japanese equities.
Target return is 12-15% per year on a Sharpe Ratio of 1.2 to 1.5. It is a Japan-only long/short equity fund concentrating on the top 250 stocks in that market. The focus on large-cap stocks is in part because of the very liquid state of the short borrow that lends to running a truly efficient hedged fund.
ôA Japan hedge fund strategy which operates in the large-cap space can be run much more efficiently as opposed to a small- and mid-cap strategy which can become a long-only proxy when fund sizes get too large,ö says Imam.
ôJapanÆs banks and corporations should be in a position to start exporting capital internationally in the next 12-18 months, thus setting it apart from its peers and this theme will start to emerge specifically from within large-cap stocks,ö he adds.
Service providers are Morgan Stanley as prime broker, GGK as auditor, and SS&C Fund Services as hedge fund administrator.
Regulators keep their eyes open on tightening insurance industry by introducing more detailed risk management requirements, which could bring pressure on smaller players.
China and India are more obvious choices for AustralianSuper to consider in Asia Pacific, but the super fund currently lacks the expertise and prefers to stick to the US and Europe.
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Investors are increasingly turning to private companies and private debt in their hunt for ESG alpha, but the age-old problem of transparency and due diligence remains