Winners rationale

Since 2010, Silverdale Capital’s reputation as a provider of quality, differentiated investment strategies has gone from strength to strength due to the firm’s outperformance in three key areas: innovation, risk management, and performance.

This dedication was arguably most evident in its flagship Silverdale Bond Fund — an ‘uncommon’ open-ended bond fund, which invests in investment grade, short-duration US dollar bonds but still managed to deliver an 8-10% return per year. Not only did it rank among the top decile in terms of performance, it also led the pack in risk management.

Specifically, the Silverdale Bond Fund, which is a weekly fund paying around 6% per year as dividend, has delivered 62.09% returns over 6 years (as at 27 September 2019) at 8.19% per year and against 36.62% returns delivered by iShares tracking the J.P. Morgan EM Corporate Bond Index. Its internal leverage feature is unique, insofar that it is ring-fenced and therefore investors are never at risk of receiving a margin call, nor are they required to service loan interest or provide guarantees to secure the leverage.

Factor in the emphasis Silverdale Capital placed on employing among the most experienced investment specialists and innovative methodologies (including Silverdale’s proprietary cashflow modelling which involves determining the fungible cash available to the issuer entity as well as debt priority), and exercising complete discipline throughout the trade on the premise that “it’s when you sell that counts”, and it’s little surprise that here in Asia — where consistent, predictable income remains a primary theme for investors — interest in and demand for the strategy has continued to rise.

Silverdale Capital’s focus on excellence was evidenced in its approach to investor service. The firm provides portfolio highlights and information on a weekly basis, unlike most bond funds which do so monthly or quarterly. Its commitment to transparency extends to sharing details of actual trades done, with a brief rationale, and making its fund factsheets available on its website which is universally accessible. The firm also holds quarterly investor calls for investors across the globe, during which Silverdale Capital’s CIO makes the point of burrowing down into the rationale and drivers of the strategy’s performance and discussing current views and action points for the ensuing quarters.

Silverdale Capital expects that insipid global growth will continue to provide an excellent carry of circa 8-10%, with further potential gains as a result of tightening credit spreads, without a corresponding increase in the cost of borrowing. Thus, the manager and its Silverdale Bond Fund, are well-positioned to deliver best-in-breed performance over the next decade.

Silverdale Capital is Asian Private Banker’s Best Fund Provider – Investment Grade Bond.