The structural change in corporate financing which started years ago has boosted the corporate debt market. This model is spreading quickly from the US to Europe and Asia.
Our investment philosophy is characterised by investing in corporate bonds with an average maturity between 3 and 5 years, with the intention to hold the position until the maturity. Thus, we avoid the interest rates hike risk, and we put a limit on the duration risk and volatility inherent in mutual funds which invest in corporate bonds through an open-end strategy. The bulk of the investments are bonds issued by American, European or Chinese companies, even though we don’t reject the possibility of investing in other geographical areas where we could find opportunities with a similar level of safety (for structural reasons we haven’t invested in Brazil and most of the countries from South and Central America, India and Africa). We prefer to invest in corporate credit (bonds issued by companies) instead of sovereign bonds (issued by governments) because they offer a higher return, which is justified in most of the cases.