The latest news in investment offerings, financial products and other services relative to wealth advisors and their clients.

NextBold Capital 
NextBold Capital, a private equity firm focused on Southeast Asia, has undertaken a $100 million money-raising for its inaugural fund, aiming to invest into small and medium-sized firms in Vietnam, Cambodia and Laos.

A number of family offices are among the investors committed to the fund, NextBold Capital said in a statement yesterday. 

The business was founded by Sjoerd Zwinkels, former investment director at Mekong Capital, and Quadrant-backed Fitness & Lifestyle Group former executives Pedro Baliza and Jonas Wilbert. The firm concentrates on sectors such as education, healthcare, consumer goods, and services.

"We're not just investors; we're partners on the ground," Baliza said. "We get involved at an execution level, helping companies address their toughest challenges and unlock their full potential."

"We're seeing great momentum from family offices and other co-investors, and are ready to capitalise on the immense growth opportunities ahead,” Baliza added. 

NextBold Capital is based in Ho Chi Minh City.

BNY Investments, Insight Investment
BNY Investments has launched a Hong Kong-focused fund that targets businesses that have been downgraded to sub-investment grade, or “junk,” in old language. 

The BNY Mellon Efficient US Fallen Angels Beta Fund is the first retail registered fallen angel fund in Hong Kong, the US firm said. The managers of the new fund expect the number of such “fallen angels” to rise amidst a weakening economic environment.

The fund is managed by Insight Investment; it seeks to exploit market structural inefficiencies and relative value mispricing opportunities, as well as enhance liquidity through “credit portfolio trading,” a more liquid alternative to traditional over-the-counter (OTC) trading. The fund is designed to deliver a return above its benchmark: The Bloomberg Barclays US HY Fallen Angel 3 per cent Cap Total Return Index Value Unhedged.

“The fund seeks to take advantage of the technical dislocation that occurs when bonds are downgraded from investment grade (IG) to sub-investment grade, which can cause passive and active investment grade investors to become 'forced sellers' of fallen angel bonds,” Paul Benson, head of systematic fixed income at Insight, said. “Opportunities are created during these periods of high downgrade activity because spreads often widen disproportionately during the month of the downgrade relative to peers and to fair value.”

The weakening economic backdrop suggests we may soon approach a sweet spot for fallen angels, with potential for $30 billion to $50 billion of new fallen angels over the next 12 months as the economy moderates,” Benson added.