The III philosophy is a disciplined, conservative, and well-defined method of fixed income investment. Individual strategies are structured to minimize credit exposure, interest rate movement, and foreign exchange risk.
Striving to protect our clients' assets in the long term, we make it our mandate to invest in low risk, hedged structures that are match funded. These structures are designed to create combinations of positive interest rate spread, attractive options, and capital gains opportunities.
The ability to identify major structural mis-pricings is one of our core competencies. The stability of our operating platform, including our employees, our capital, and our infrastructure, enables us to confidently invest in structures that have longer time horizons. This is both a niche and an edge for III.
In our rates portfolios, we generally concentrate on high-quality assets such as sovereigns, quasi-sovereigns, futures on sovereigns, and agencies.
In our credit portfolios, we generally concentrate on the more liquid sectors of the market, seeing relative value opportunities. Long exposures are usually hedged, such that our default risk is minimal.
On the hedging side, we use the full spectrum of fixed income tools such as futures, interest rate swaps, total return swaps, interest rate caps, interest rate swaptions, CDS, credit indices, and tranches.
This description is qualified in its entirety by the description of III Capital Management's trading approach contained in the offering memoranda for the funds managed by III.