Forward's global long/short fund 'tilts toward alternative investing'

By Toni Weeks

San Diego, Nov. 17 - Forward Management, LLC has launched the Forward Global Credit Long/Short Fund, according to a press release.

The new fund, which launched on Oct. 1 with Investor Class, Institutional Class, Class C and Class M shares and offers a hedge-style, long/short strategy targeting the corporate debt sector, complements the firm's long-only Forward EM Corporate Debt Fund.

Both funds are managed by Newport Beach, Calif.-based SW Asset Management, LLC.

The fund typically will invest in at least 10 countries at any one time, with some bias to emerging markets, given their generally higher economic growth rates. At least 40% of the fund's assets must be invested in issuers based outside the United States. The fund can also potentially hedge against sovereign defaults and extreme credit market downturns.

"Our new long/short fund is designed for investors who want broad exposure to debt opportunities around the world but are also concerned with volatility and interest-rate risks," Forward chief executive officer J. Alan Reid said in the press release.

David Hinman, co-founder and chief investment officer of SW Asset Management and co-portfolio manager for the new fund, said that low interest rates and high leverage in the credit markets of the developed world make a prime environment for the fund, which could also benefit from debt opportunities in the emerging world as well as the inevitable restructuring of debt in the developed world.

He also noted in the release that non-U.S. corporate debt is a strong portfolio diversifier that allows exposure to private companies.

"A good number of the companies we follow are privately or government-owned enterprises, and in our estimation they are not going public yet because they expect to be valued much more highly in the future," Hinman said.

The Forward Global Credit Long/Short Fund is one of 11 alternative strategies packaged as mutual funds and meant to provide investors with an expanded toolkit to handle economic uncertainty.

"Long-only strategies certainly have their place, and we offer a variety of them," Reid stated in the release. "But in our view, if you limit yourself to the traditional style boxes and a long-only approach, it's much more difficult to manage risks and get ahead in the long run. We're convinced that a tilt toward alternative investing is the direction of the future."

Forward Management is a privately held asset management firm based in San Francisco.

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