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Strong growth with securitisations

Established at the end of 2021, Fair Alpha Securitisation SA benefitted from the strong demand for securitisations in its first fiscal year. “With a potential issue volume of EUR 700 million, we are well above budget”, says Daniel Knoblach, Fair Alpha Member of the Board. “The pronounced change in direction on the markets has led many initiators to opt for the flexible securitisation vehicles known as compartments.”

Compartments, also referred to as Actively Managed Certificates (AMCs) in the case of liquid trading strategies, are issued under Luxembourg law. They offer initiators and investors the opportunity to map an entire strategy with securities that carry an ISIN and that may be held in a custody account. “The year 2022 has shown that numerous asset managers or providers of active strategies had to quickly adjust their orientation”, Knoblach points out. “Individual issues are very cumbersome to manage by asset managers, and the relaunch of funds takes its time.”

AMCs, however, are much more flexible. “A strategy’s time to market is considerably shorter”, says Knoblach. “That can be a key advantage in these turbulent times.” And ever more issuers see it that way, too. The popularity of AMCs is growing rapidly: “We estimate that the issuance volume has more than tripled in 2022”, Knoblach adds.

Fair Alpha is benefiting from this shift in investor preferences. “We have the infrastructure to launch and manage AMCs”, says Knoblach. “And we are able to do so very quickly, for a large number of special cases, and at a reasonable cost.” Fair Alpha actively works with leading brokers and custodians for traditional and digital (crypto) AMCs. For the latter, further growth is on the horizon: A growing number of providers and investors are also looking for digital investment opportunities, which may be realised very well with securitisations.

“Most of the strategies launched this year are now increasingly going into sales, and there will be another huge push in 2023”, Knoblach explains. Demand from Germany also continues to grow, so that an additional paying agent, Baader Bank, has been added. “We will focus on the German market in 2023”, says Knoblach.