Compass Group, one of the leading independent investment advisors in Latin America, has partnered with PIMCO, a global fund manager, to launch Compass Global Credit, a feeder fund that invests 100% of its assets in fixed income strategies managed by PIMCO, which are registered in Ireland, comply with UCITS regulations and have daily liquidity.
The management team is headed by Mark Kiesel, CIO of the company’s Global Credit division, Andrew Jessop, a manager specializing in high-yield debt, and Hozef Arif, a manager specializing in global high-yield debt and corporate credit strategies.
Compass Global Credit invests at least 80% of its portfolio between the PIMCO GIS Global Investment Grade fund, a portfolio that seeks to maximize the total return on its assets by actively investing at least two-thirds of them in global corporate debt investment grade instruments, and the PIMCO GIS High-Yield Bond, a strategy that seeks to maximize total return and limit risk by investing at least two-thirds of its assets in a portfolio ofglobal high-yield bonds rated lower than ‘Baa’ (In Moody’s case) or ‘BBB ‘(as per S & P), with a maximum of 20% of its assets invested in securities with a rating lower than B.
Depending on PIMCO’s view on the two asset classes in which the major funds are invested, either of the two strategies can be underweight/overweight versus the benchmark, which is composed of BofA ML US High-Yield index (60%)and Barclays Global Aggregate Credit (40%).
In addition, the fund has a potential 20% to make a tactical allocation to other PIMCO UCITS mutual funds that invest in other asset classes within the fixed income universe. In this way, the management team can assign assets to the two main strategies according to their macroeconomic and market perspectives, and at the same time has the ability to tactically allocate resources to other funds, in case they have a stronger conviction in those asset classes.
To provide greater flexibility to the investor, the fund, which distributes dividends annually, has a dollar class and another in Chilean pesos.
At the end of December 2016, the fund denominated in Chilean pesos reached a wealth of more than 13.5 billion pesos, while the fund denominated in dollars exceeded 34 million dollars.
A visit from a PIMCO Product Specialist to Santiago de Chile has been scheduled for March to present the strategy to Family Offices, UHNW individuals, andprivate banking platforms.