Altana Wealth, a specialist fund manager focused on delivering alpha from niche strategies uncorrelated to other asset classes, has launched a new fund.

Altana Wealth, a specialist asset manager, has launched the Altana China Recovery Opportunity (ACR) fund to deliver asymmetric payoffs from investments in Chinese real estate bonds, despite the challenges faced by China's real estate.

Altana Wealth focuses on distressed and event-driven credit through strategies such as Altana Distressed Opportunities, Altana Credit Opportunities, Altana Asymmetric Opportunities and the Altana Event-Driven Credit Fund.

Targeting returns of 2 to 4x over 18 to 36 months, the fund aims to participate in the restructurings of distressed offshore Chinese real estate developers whose bonds are governed by New York law and who are entering consensual restructurings with creditors, the firm said in a statement. With more than 40 private developers in China now facing complex, multi-year restructurings with their offshore bonds, Altana believes that the combination of bottoming prices and a policy backdrop favouring asset recovery presents an overlooked opportunity in which a significant asymmetric payoff is achievable.

"This is an archetypal Altana investment opportunity: specialist, overlooked, and asymmetric. In a world of increased interest rates, inflationary pressure, and market overcrowding, smart investors want to allocate some of their portfolio to investments that can potentially supercharge their returns,” Lee Robinson, founder and CIO of Altana Wealth, said. “As with many of Altana's funds, the ACR can provide investors with a differentiated return stream, increasing their exposure to specialist and often disregarded opportunities through a team with deep analytical capabilities and a strong track record of delivering alpha."

The strategy is managed by portfolio managers Benedict Keim and Mathieu Scemama working with CIO Lee Robinson, alongside the Altana team. Altana Wealth said it will invest its own capital in the fund to ensure that it is aligned with its co-investors.

This is despite the challenges China’s real estate sector faces, with house prices falling and a slowdown in investments. However, a number of wealth managers have come out recently in favour of emerging markets and Asia this year, for instance UK-based Aberdeen Investments, Paris-based Amundi, Carmignac and Indosuez, as well as GIB Asset Management and Franklin Templeton. While China faces many structural challenges over the next five years, Aberdeen takes comfort from China’s new five-year plan to accelerate the green transition, after it wrapped up its fourth plenum meeting of the Communist Party of China. See more here and here.