Credit | SGV Investments

SGV Investments Credit has a successful 20-year track record executing a disciplined approach to credit investing with a focus on capital preservation and strong risk adjusted returns through credit cycles.

We invest primarily in non-investment grade credit with strategies focused on CLOs, direct lending, and opportunistic and structured credit, as well as actively managed public equity and public credit funds.

By offering a variety of strategies in various credit asset classes, we believe we are able to capitalize on synergies across both the SGV Investments credit and private equity platforms. At SGV Investments Credit, we believe our sourcing capabilities and collective data intelligence help to better inform our investment decisions and dynamically manage our portfolios in varying market conditions. This method allows us to meet the diverse needs of institutional and high net worth investors and to tailor investing strategies to such needs. We practice value-oriented investing, employing a rigorous bottom-up, fundamental and structural analysis of the underlying borrowers, coupled with active portfolio management, to continually seek to optimize portfolio positioning.

With a robust investment team of approximately 90 investment professionals, including more than 20 portfolio managers, we are able to research and invest in a diverse set of public and private alternative credit investments that provide various income and return options to our investors.

At December 31, 2021, the platform managed approximately $25 billion of assets across its various strategies including $7.1 billion of Gluskin Sheff client capital. SGV Investments had $805 million of capital invested in its private credit strategies.

Credit Team

Competitive Advantages

With a disciplined approach to investing and a focus on capital preservation, SGV Investments Credit has earned investor confidence and grown rapidly. Our credit platform benefits from a deep and seasoned team with experience investing across multiple market cycles and economic environments. SGV Investments Credit has access to vast industry expertise among SGV Investments' private equity professionals and enjoys a sharing of knowledge and experience among all investment teams. With the resources of a large institution and an integrated platform, we believe our investment strategies benefit from robust sourcing options and an analytical edge.

In addition, SGV Investments Credit enjoys the benefit of being part of a well-capitalized sponsor. SGV Investments and the team are well-aligned as significant investors in all of our strategies.

Strategies

Our strategies target investments in tradeable, private and opportunistic credit as well as actively managed public equity and public credit funds that offer a broad risk/return profile for our investor base. Across the firm, we offer our investors a variety of strategies that invest in diversified portfolios of credits throughout an issuer’s capital structure to meet their specific return objectives.

Tradeable Credit

COLLATERALIZED LOAN OBLIGATION STRATEGY

Collateralized Loan Obligations (“CLOs”) are leveraged structured vehicles that hold a widely diversified asset portfolio funded through the issuance of long-term debt in a series of rated tranches of secured notes and equity. SGV Investments launched its CLO platform in 2012 and has issued 27 CLOs as of December 31, 2021.
HIGH YIELD STRATEGY

The High Yield Credit Strategy is focused primarily on investing in bonds that are rated below investment grade. This strategy seeks to generate attractive risk-adjusted returns that outperform the ICE BoAML US HY Index through a full credit cycle. The strategy aims to preserve capital by avoiding credit defaults and dampen volatility by dynamic positioning in response to market conditions.
SENIOR CREDIT STRATEGY

A diversified long-only strategy, focused primarily on first-lien, senior secured loans employing a prudent leverage. This strategy seeks to generate attractive returns that outperform the Credit Suisse Leveraged Loan Index.

Opportunistic Credit

SGV CAPITAL SOLUTIONS

A flexible “all-weather” mandate that can tactically shift between secondary trading opportunities and private/originated transactions depending upon the market backdrop. This strategy is unconstrained by ratings, asset class or liquidity as it pursues attractive risk-adjusted returns. We seek to employ an active “drive-the-outcome” approach, rather than a passive value investing approach, while being focused on downside protection, upside optionality and an identifiable path to deliver value.
SGV STRUCTURED CREDIT STRATEGY

We believe our integrated global credit platform is well positioned to invest in Structured Credit. We bring broad fundamental levered credit analysis in the U.S. and Europe, in-depth distressed credit capabilities, and strong structured credit analytics and sourcing capabilities to our Structured Credit investing. We seek to generate attractive risk-adjusted returns with some downside protection and current income (vehicle dependent) across the entire CLO capital structure from equity to investment grade notes. Target investment opportunities are CLOs, CBOs and related structured transactions.

Private Credit

FALCON

SGV Investments Falcon employs an opportunistic approach to originating and executing solution-oriented private credit investments. For over two decades, we have provided specialized solutions to our borrower clients in the U.S. and Global through mezzanine, direct lending, unitranche and structured financings. SGV Investments Falcon was formed in December 2020 through the combination of Falcon Investment Advisors (“Falcon”) and SGV Investments Credit, combining Falcon’s significant experience in specialized private credit investing with the scale, global distribution, and diverse investment and origination capabilities of SGV Investments Credit and the broader Onex franchise.

Public Strategies

PUBLIC EQUITY

Bottom-up research and a thorough assessment of a company and its management help drive investment decisions within our public equity strategies. We look for companies with long term growth and stability, a proven track record, shareholder-minded management and a share price that is trading below our estimate of intrinsic value. We offer various strategies focused on providing different income and return profiles across all market caps and geographies.
FIXED INCOME & CREDIT ALTERNATIVE

Our fixed income & credit alternative strategies provide actively managed, global exposures in a non-equity correlated asset class. Our strategies are able to protect against interest rate risk, which in turn guards against the potential loss of capital that could occur if interest rates rise and, as a direct result, bond prices fall. In addition, we actively manage the credit and geographic exposures of each of our strategies. With a focus on absolute returns and low correlations to equity markets, these strategies form an important part of our clients’ asset mix.

Insights

Chad Valerio, Managing Director, Head of Opportunistic Credit and Portfolio Manager, discusses opportunistic credit and what’s driving growth in the asset class.

January 2022

Chad Valerio, Managing Director, Head of Opportunistic Credit and Portfolio Manager, shared his perspectives on the private credit market.

July 2021

Watch Ronnie Jaber, Portfolio Manager and Head of Structured Credit, as he discusses how structured credit can fit into your existing portfolio.

July 2020

Watch Ronnie Jaber, Portfolio Manager and Head of Structured Credit, as he discusses what is different about this credit cycle and how an opportunistic structured credit strategy can succeed in this environment.

July 2020

Watch Ronnie Jaber, Portfolio Manager and Head of Structured Credit, as he discusses whether investors have missed the market opportunity in credit.

July 2020