Marathon Structured Finance Fund: An Overview

The Marathon Structured Finance Fund is an investment vehicle focused on generating returns through investments in structured credit markets. Structured finance involves creating complex financial instruments from underlying assets, such as mortgages, auto loans, or credit card receivables. These assets are pooled together and then repackaged into securities with different risk and return profiles, catering to a variety of investors.

Marathon Asset Management, the firm behind the fund, is a global investment manager known for its expertise in credit markets and a value-oriented investment philosophy. They typically aim to identify undervalued or mispriced assets within the structured credit space, capitalizing on market inefficiencies and complexity.

Investment Strategy

The fund’s investment strategy generally involves a rigorous, bottom-up analysis of individual securities and the underlying assets. The investment team assesses the credit quality of the borrowers, the structure of the transaction, and the legal framework governing the securities. Marathon likely employs a team of experienced analysts with deep knowledge of the securitization process and the nuances of different asset classes.

Key areas of focus within structured finance might include:

• Residential Mortgage-Backed Securities (RMBS): Securities backed by residential mortgages.
• Commercial Mortgage-Backed Securities (CMBS): Securities backed by commercial mortgages.
• Asset-Backed Securities (ABS): Securities backed by various assets like auto loans, student loans, or credit card receivables.
• Collateralized Loan Obligations (CLOs): Securities backed by a pool of corporate loans.

The fund’s strategy may also involve actively managing its portfolio by adjusting its holdings in response to changing market conditions and credit cycles. This could entail buying or selling securities, hedging against risks, or reallocating capital across different asset classes.

Risk and Return

Investing in structured finance carries inherent risks, including credit risk (the risk of borrowers defaulting), prepayment risk (the risk of borrowers paying off their loans early), and liquidity risk (the risk of difficulty selling securities quickly). The complexity of these instruments also requires a high level of expertise to properly assess their value and risks.

However, structured finance can also offer attractive returns relative to other fixed income investments, particularly when market conditions are favorable and the fund’s investment team can successfully identify undervalued opportunities. The Marathon Structured Finance Fund, with its experienced management team and value-oriented approach, aims to deliver consistent, risk-adjusted returns for its investors.

Disclaimer: This is a general overview and does not constitute financial advice. Investment decisions should be based on individual circumstances and consultation with a qualified financial advisor.