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Alternative Market Briefing

Octagon says 'time is right’ to launch trade and commodity finance hedge fund

Tuesday, February 24, 2015

Komfie Manalo, Opalesque Asia:

Saying that the "time is right for this strategy," Octagon Asset Management CEO and Head Portfolio Manager Mead Welles announced the launch of the Octagon Global Trade Fund, a direct-lending specialty finance vehicle built upon collateralized loans to exporters and importers around the world.

In a press statement, Octagon said that the Global Trade Fund has a target annual return of 8-12% after fees with low volatility and low correlation to all major capital markets.

Welles said, "A host of factors – including the global liquidity crisis and the impact of Basel III regulatory changes – have made it much more difficult for exporters and importers to secure financing from traditional sources such as multinational banks. At the same time, the persistent low-interest rate environment makes the high-yield, low-volatility characteristics of the Global Trade Fund an extremely attractive fixed income alternative to investors."

The Global Trade Fund offers various forms of financing to qualified companies engaging in international trade who meet a rigorous screening process.

He added, "The basic strategy is very straightforward. We make loans to exporters and importers, secured by their inventory, trade receivables, or both. It’s actually one of the oldest forms of finance, but we use modern, sophisticated techni......................

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