The Luxembourg-domiciled Melchior All-Weather Credit Fund has a universe which includes European investment grade, crossover and high-yield positions.
It looks to exploit both long and short opportunities and offers daily liquidity.
The fund launch comes a day after the private wealth manager agreed to buy MSK Capital Partners, a deal which increased its assets by £184m.
As its name suggests, the all-weather fund focuses on capital preservation and growth during volatile market conditions, targeting a return of 5% to 7% per annum with a volatility of 3 to 3.5%.
It will be managed by Yassir Benjelloun-Touimi, who joined Dalston in September 2016 from Chenavari Credit Partners where he was a long-short credit manager.
Before that, he was UBS’ head of credit proprietary trading and head of credit arbitrage at Bank of America (Europe).
‘’Our investment process is different to that of most credit managers,” explained Benjelloun-Touimi.
“We focus on isolating alpha and removing risk. We combine our credit selection and hedging capabilities with an innovative risk parity construction approach.
The outlook for conventional long only credit portfolios remains gloomy, in Benjelloun-Touimi’s view, which is one of the reasons traditional funds have produced a “negative asymmetry.”
“Our approach is designed to reverse that asymmetry, protecting capital and providing stable returns,’’ he explained.
