- Income Partners Asset Management
SUVIR MUKHI, CFA
PARTNER, CO-CHIEF INVESTMENT OFFICER & SENIOR PORTFOLIO MANAGER
Suvir Mukhi is a Partner and Co-Chief Investment Officer responsible for Asia/EM strategies including offshore Asian credit (USD) as well as non-China local currency markets. He covers cash bonds, interest rates and foreign exchange strategies. Suvir manages the IP All Seasons Asian Credit Fund, the IP All Seasons Bond Fund, as well as several managed accounts.
Suvir joined Income Partners in 2000 and has over 19 years of global fixed income market experience. His experience includes portfolio management, fundamental credit research and macroeconomic analysis. Portfolio’s managed by Suvir include both investment grade and high yield mandates, with absolute return and long only strategies.
He is a long-standing member of Income Partners investment management team and is a core member of the investment committee. Suvir’s commitment and contributions have proven to be integral to the firm’s positive developments over the years.
A CFA charter-holder, Suvir received his education at Bentley College, MA, USA, where he earned a Bachelor of Science degree with a major in Finance.
Income Partners was founded in Hong Kong in 1993 as a specialist Asian fixed income manager. We remain focused on this asset class, providing independent and specialist investment solutions to our clients.
Our investment philosophy is simple: we believe managing downside loss is as important, if not more so than managing upside potential. Fixed income investing is all about compound interest effect: the less you lose when markets are down, the more you gain over the longer term.
This results in a combined top-down and bottom-up investment approach: active top-down macro/market and portfolio risk management to mitigate potential loss from macro and/or market events, combined with fundamental (bottom-up)credit research to determine the risk-reward profile of each credit and avoid defaults.
Asian investment grade and high yield markets continue to offer opportunities, even following the strong performance year-to-date. A dovish Fed and rate cuts in Asia should remain tailwinds, while market dispersion and an active primary market provide alpha opportunities.
Asian sovereign ratings remain on a medium-term uptrend, and the average credit quality of corporate issuers that we cover remains strong. Trade tensions are expected to remain a source of volatility, but are unlikely to overwhelm the market in our opinion.
Our active management style, where we adjust risk allocations and use hedges to manage risks is well suited to the market.
Since university, I’ve been very interested in security valuation and the research behind it. I was fortunate to have had the opportunity to begin my career in research. Over the years I have taken up increasing portfolio management responsibilities. Currently, I manage both long-only as well as long/short strategies.
I feel this is an ideal position, where I’m able to combine our team’s passion for identifying attractive investments with bottom-up credit analysis and top-down allocation and risk management with a view to generate attractive risk adjusted returns for our clients.
Careful due diligence on each investment, including fundamental analysis and relative value compared to peers, is a prerequisite in constructing and managing a portfolio. We should always maintain this discipline irrespective of market trends, and we owe this to our clients.
We aim to deliver clients attractive risk adjusted returns over a cycle. This means choosing the right securities and managing portfolio allocations based on market views and active risk management.
Everything we do revolves around protecting client assets, from credit analysis, security selection, risk management, portfolio hedges to counterparty selection. I believe being an independent asset manager serves us well in this regard with decisions always made with clients’ best interests at heart.
Mastering the Market Cycle: Getting the Odds on Your Side by Howard Marks is a great read. Howard stresses the importance of recognising, and calibrating portfolios to, different economic and market cycles at play at any given point.
While the duration, form and magnitude of cycles is always hard to precisely predict, managing portfolio exposures based on available information can certainly be helpful in taking advantage of opportunities and controlling portfolio risks.
We regularly read the Wall Street Journal, Financial Times, Bloomberg, CNBC, Economist, and Debtwire for credit market related news.
Income Partners is a specialist Asian fixed income manager established in Hong Kong in 1993, managing corporate and sovereign bonds across both US Dollar and Asian local currencies, with a focus on offshore and onshore Renminbi. Income Partners actively manages money market, investment grade, high yield and special situations across both long-only and absolute return strategies, and provides tailor-made solutions to institutional clients.
Income Partners has an experienced and stable core portfolio management team, with average tenure of 14 years at the firm and 18 years in the industry.
We have established strong networks of contacts, service providers and relationships both in the region and globally, providing an edge in research, due diligence, deal sourcing and workouts.
We have experienced and weathered 4 periods of significant credit market and macro volatility: 1997 Asian Financial Crisis, 2003 SARS Epidemic, 2008 Global Financial Crisis and 2011 European Debt Crisis.
The team uses proprietary forward-looking analysis and have produced a track record of strong alpha generation. We intensely focus on downside protection which has led to low volatility and favorable upside/downside capture.
We currently manage both long-only and absolute return (long/short credit) Asian credit strategies. In both strategies, the investment processes are based on detailed in-house fundamental credit analysis and relative value assessment. Both strategies also offer attractive dividend structures.
The long-only strategies are primarily focused on identifying credits with improving profiles and attractive valuations. Macro top-down views are included through our country and sector allocations, as well as interest rate and credit hedges.
The absolute return strategy includes (a) fundamental long/short credit investments, e.g. we long improving or underpriced credits and short deteriorating/overpriced credits; b) situational investments (restructuring, corporate events or M&A), and c) local market opportunities. We are able to dynamically adjust the risk profile and allocation between sub-strategies based on the market environment and use credit derivatives and other credit, interest rate or currency hedges.
With a focus on downside protection, we have been able to achieve favourable upside/downside capture and outstanding risk adjusted returns.
The information provided herein has not been reviewed by any regulatory authority. It is not intended as an offer, solicitation, advice or recommendation to buy or sell any securities or any products. To the extent permitted by applicable law, none of Income Partners, its affiliates, or any officer or employee of Income Partners, accepts any liability whatsoever for any direct or consequential loss arising from any use of the information, including for negligence.
July 1, 2019
by Investment and Research Team