Kirkoswald Asset Management is pulling an emerging-markets credit sleeve out of one of its current approaches to create a standalone fund, according to people familiar with the plan who asked not to be named because the details are private. The strategy is set to be more directional and focus on high-yield sovereign credit opportunities. A firm representative declined to comment.
Giorgio Lombardo will helm the new vehicle alongside the ex-Emso Asset Management team. Greg Coffey will have no part in managing this fund. Trading is expected to begin next year.
Kirkoswald agreed to buy Emso in 2024. Coffey, known for his emerging-markets macro wagers, returned from retirement in 2018 to start his hedge fund.
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Sovereign debt markets are in a rough patch as the US-Iran war keeps oil prices elevated and risk appetite subdued. Appetite for hedge funds has been strong this year, with a Bank of America survey identified hedge funds as investors' top asset class. That demand is encouraging longer capital lockups and fewer openings at the largest managers, since many firms would rather not take in more money than they can put to work. Earlier this year, to lock up client capital for a longer period, Kirkoswald introduced a five-year-lock share class to its flagship, Bloomberg reported.
Kirkoswald manages around $20 billion. In August, its Master fund rose 1.7%, bringing year-to-date performance to 20% through the first eight months. For individual investors, the mix of stronger demand, tighter access, and a specialized EM credit launch suggests the real challenge is less finding funds and more getting into the ones you actually want.
