Absolute Return

PCAM Liquid Alternative Credit

January 21, 2021

The PCAM Liquid Alternative Credit fund is a diversified fund of funds, which invests into niche strategies within the global alternative credit universe.

The fund is diversified across geographies, strategies and asset classes and provides access to selected best-in-class strategies, yielding high and stable returns with low correlation to credit spreads.

Our approach

Liquid Alternative Credit comprises private credit strategies which are niche in nature and command a complexity premium. The space is fragmented into multiple small, capacity constrained managers and comprises a number of sub-strategies, such as trade finance, specialty lending and SME lending. Combining these sub-strategies strongly improves risk-return as they are generally uncorrelated to each other. Underlying instruments are typically unlisted and short-dated, with maturities ranging from 30 days up to 18 months. The fund seeks to provide investors access to a diversified portfolio of such niche strategies and managers, offering quarterly liquidity while yielding stable returns of ca 7-9%, with a low beta to traditional credit markets.

PCAM Liquid Alternative Credit at a glance

  • Hard to access strategies fragmented into many small and capacity-constrained managers
  • Focus on niche credit strategies, such as trade finance, specialty lending and SME lending
  • Targeting consistently high returns and low volatility across uncorrelated sub-strategies, in times of unattractive traditional fixed income markets
  • Underlying investments typically senior in the capital structure with strong collateral protection
  • Quarterly liquidity and strong alignment of interest between investors, fund management and underlying managers
  • Team with excellent track-record and senior PMs with combined 40+ years experience and expertise in Alternative Credit and fund of funds management

Read more about the fund.

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