The Systematic Alternative Fixed Income (SAFI) strategy is an alternative markets CTA. The strategy applies modern CTA technology to a diversified set of fixed income markets which consist mostly of OTC and cash instruments, spread across developed and emerging markets. These markets are driven by idiosyncratic factors and tend to decouple from global interest rates during periods of financial stress, funding stress, and are also impacted by trends in cross-border issuance. As we do for our Alternative Commodity Absolute Return (ACAR) strategy, we focus on this market universe based on one of the core tenets of our investment thesis: expected returns from trend-following should be higher, and correlations lower, across markets in which there is less capital competing for the same source of return.

The SAFI team believes that this can be accomplished by operating in a wider fixed income segment which is inherently more diversified and less saturated with trend-following capital, creating robust alpha-generating opportunities while presenting higher barriers to entry.