The Fund returned 0.62% over the month of May, delivered 2.29% for the previous three months and 11.96% over the past 12 months. The Net Asset Value (NAV) of the Fund, as at 31 May 2014, was $45.6m1 and the redemption price was 1.3698492.
While risk assets have experienced a steady grind higher this year, the interest rates market has shifted around. Yields on US 10yr treasuries hit a recent high of 3% in January. They since rallied to 2.44% and recently sold off to 2.6%. While this market has not been overly volatile, it has caused some anxiety with fixed income fund managers with an interest rate exposure.
The Laminar Credit Opportunities Fund does not take interest rate risk. It generates excess returns by focusing on opportunities in the credit markets. It removes interest rate risk via investing in floating rate notes or hedging out the interest rate exposure in fixed rate securities. Given the likely increased volatility that lies ahead in the rates market, we are certainly comfortable with the Fund’s no interest rate exposure mandate.