Research house Zenith Investment Partners has awarded the Ares Global Credit Income Fund a recommended rating on the strength of a combination of characteristics the manager has displayed.
Specifically, the research house acknowledged Ares Australia Management’s ability to identify relative value opportunities across a broad range of credit markets, enabling the Global Credit Income Fund to deliver outperformance.
To this end, the offering was able to achieve a return of 12.13 per cent net of fees in its initial year, with total income for the period reaching 10.59 per cent.
Zenith also commended Ares on its selection of a well-resourced team to run the fund and its structured investment approach.
The fund is run by Ares Australia Management, a strategic joint venture involving Fidante Partners and Ares Management Corporation, and aims to provide stable monthly income with a focus on downside protection across market cycles. Its portfolio is constructed using corporate and structured credit assets, including United States and European corporate bonds and bank loans.
“The fund’s strategy of investing in high-quality credit instruments is geared toward capital preservation through fundamental credit selection and a flexible approach to capitalise on the most attractive relative value opportunities,” Ares credit group portfolio manager and head of US liquid credit research Samantha Miller noted.
“We believe that this approach offers greater opportunities for current income and yield versus traditional fixed income and passive strategies, while reducing volatility and default risk through downside protection offered by senior, and often secured, positions in corporate bonds, loans and asset-backed securities.”
Commenting on the rating, Ares Australia Management head Teiki Benveniste said: “This rating underscores our belief that the ‘sweet spot of credit’, characterised by high levels of current income and low interest rate duration risk, can offer a solution to Australian investors in search of higher income and diversification.”
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