Schroders is set to add a long/short credit strategy to its UCITS hedge fund platform later this year.
The fundamental Schroders GAIA Avoca Credit Fund will debut in November and will subsume Avoca Capital Management's existing UCITS-compliant fund, Avoca Credit Absolute Return. The strategy will continue to be managed by Avoca's Simon Thorp and James Sclater.
Avoca bought the strategy from Liontrust Asset Management two years ago. It has produced annualized returns of nearly 10% since 2002.
"We are very pleased to be partnering with Schroders, which has established one of the leading alternative UCITS platforms," Thorp said. "Having successfully managed this strategy for over a decade, we are excited to be able to offer it to a wider audience via the Schroder GAIA distribution network. We are currently seeing a strong investment case and wealth of alpha opportunities within the long/short credit space as we enter the mature part of the credit cycle and an upturn in the interest rate cycle."
The Avoca fund will be the sixth on the GAIA platform, which now boasts more than €1.8 billion (US$2.4 billion) in assets under management.