The Highmore Trade Finance Fund, LP is filling a gap in the market, providing trade financing for strongly managed, well established, profitable small and medium-sized enterprises. Whereas most investment strategies are in the prediction or forecasting business, we characterize our strategy as a contractual business given the repayment terms.
Since inception in April 2018, the Fund has returned an estimated 6.09% compared to -1.23% for the Barclays US High Yield Index and -3.65% for the S&P 500 Total Return Index. The Fund’s partial-year performance was in spite of cash drag typical in the early ramping months following inception.
The Fund returned an estimated 0.78% in December compared to -2.14% for the Barclays US High Yield Index and -9.03% for the S&P 500 Total Return Index.
Increasingly volatile and correlated equity and fixed income markets have made meaningful portfolio allocations to alternative investments more important now than perhaps ever. And, among alternative investment opportunities, we believe the short duration, security, and self-liquidating attributes of the Highmore Trade Finance Fund’s underlying transactions uniquely well position investors.
- Short Duration: each transaction is typically 30-120 days
- Secured Investments: liens, personal guarantees, lock box and cross corporate guarantees typically with lower middle-market companies
- Self-Liquidating: transactions self-liquidate vs. dependency on a market event to realize value
We also frequently use credit insurance and letters of credit to limit the loss of principal, as additional risk mitigating tools.
In addition to the December 2018 estimated performance of the Highmore Trade Finance Fund, LP, we’re pleased to provide you, linked below, with expanded year-end commentary contextualizing the market backdrop; our approach; and our continuing highly constructive outlook around the opportunity set for the strategy and the sourcing of attractive financing opportunities.
Highmore Trade Finance Fund 2018 Year-End Review
Highmore Trade Finance December 2018 Estimated Performance
Please be in touch with any questions. We look forward to continuing the dialogue.
On behalf of the Firm,Jon David Willingham, Partner
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