We seek investments where management has a playbook for debt reduction.
Since 2009, Sidus has been executing a long and short credit strategy that invests in a wide universe of yield assets, including high yield, corporate, and convertible debt instruments. These holdings tend to offer better than average yield and security relative to market expectations and are generally the “first-to-finish” in the corporate capital structure. Companies that have articulated a playbook for their retirement of their debt are desirable. Oftentimes, these debt tranches are reduced in size earlier than the stated maturity through a variety of corporate actions and in turn, show accelerated returns or upside beyond the original entry point return expectations.
Flexibility in an Ever-Changing Market Environment
The strategy is unconstrained and scalable. Our deep analysis includes the history of the interest rate curve as well as the history of excess investment yield over the U.S. Treasuries or spread. As such, we are well-equipped to allocate assets among core investments as market conditions change.
Risk Adjusted Returns Over the Long Term
Our objective is to achieve superior risk adjusted returns over the long term by identifying compelling value in select issuers with high degrees of asset coverage and where multiple avenues can be used to return our principal. We seek protection of our principal through asset values and cash flow multiples as it provides companies a variety of levers to pull to control their balance sheets.