LONDON, Nov. 28, 2017 /PRNewswire/ -- In a recent interview with the Local Manager of the Prudent Investment Fund's Brazilian operation, Giovanni Cataldi, we had a chance to discuss some of the key elements leading up to Prudent Group's (Prudent) success.
Prudent focuses on short-term corporate lending in Brazil. Through financing a broad range of businesses, mainly in non-cyclical segments of the economy, the firm aim to create long-term mutually beneficial relationships with its borrowers and, furthermore, strive to protect the investments with credit insurance when possible.
Giovanni describes what services the firm offers specifically within the hedge fund space, and how he and the team tailor its services and solutions around the needs of each individual client.
"Regarding some of the services that we provide, Prudent offers international investors the possibility of significant investment returns in our Brazilian short-term corporate credit business, we run regulated funds in both Luxembourg and Brazil to achieve this end. However, Prudent is not a hedge fund in the traditional sense as we solely invest in self-generated short-term corporate receivables through an operational business active in the Brazilian credit market."
"...the goal for Prudent is to identify and effectuate highly scalable, repeatable, and defensible transactions while utilizing downside risk mitigation strategies, such as insurance, overcollateralization, and extensive client monitoring."
After talking about some of the services that Prudent provides, this leads us on to the resulting success of the company itself. Giovanni explains how it feels to have been selected as the Most Outstanding Hedge Fund Manager – 2017, and how it can benefit the company in the long term.
"Here at Prudent, the Prudent Family humbly accepts this award as a token of recognition of all the hard work put into creating a ground-breaking vehicle for international investors to invest in the highly lucrative Brazilian Capital Markets. Personally, I hope that the award will be recognized by the AI community and attract potential investors considering committing some Prudent investment capital."
Part of this continuing success is that Prudent has been able to differentiate itself from similar firms within the industry, guaranteeing its clients and borrowers that they are the best option in which to commit to some capital. Giovanni alludes to the long-term relationships that the firm has built with man of its borrowers, and this is a sure sign of its success.
"Prudent's borrowers are very pleased with our offerings, execution, and appreciate the long-term approach we take in building our relationships. Many of the borrowers have formed business alliances with our staff members dating back some 10-20 years, which makes Prudent "their first call". Additionally, as Prudent has grown, we have been lucky enough to acquire talented and seasoned veterans with a deep understanding of the market dynamics and the competition. Through leveraging the talent that has been brought aboard, Prudent will continue to improve our offerings with a goal of becoming a staple in the Brazilian short-term lending market."
Working within such a fast-paced industry, Giovanni and his team must ensure that Prudent remains on the cutting edge of any new developments, and he explains how the company are always in the best position to match and answer clients' needs.
"In order to stay ahead of other asset managers and exogenous economic and political variables, Prudent is constantly evaluating our current positions, investment processes, and assessing new strategies that fit our investor's needs. For example, in less than six months Prudent has managed to enter the extremely profitable Brazilian credit card receivables business and created our own echo-system of card terminals, processing, and receivables discounting in which we are creating a possibility for the merchants to get rid of their banks. The business is run through a separately regulated FIDC, in which the Luxembourg SICAV SIF, the Prudent Investment Fund, is the sole investor. This is a good example of how Prudent strives to innovate and create diversified value for investors through multiple strategies.
Throughout the company, the team believes that by expanding its geographic footprint in Brazil, both Prudent and its borrowers can benefit from a local presence and close culture. Currently, the firm has local Sales Teams in three main locations, two in Sao Paulo and one in Porto Alegre, as well as representatives in multiple other locations.
Within the local institutional market, Prudent offers services and solutions that are able to cater to a variety of different needs, and an assortment of clients. Giovanni is keen to highlight the experience of the firm's customer service team, showcasing the team's ability to service the market in a professional manner.
"At Prudent, we have found that there is nothing more important than to receive the approval from the large local institutional investors for our efforts. Our local Sales Teams targeting Brazilian institutional investors is set up in coordination with CM Capital Markets, led by Fernando Barroso. Through this extremely well established and experienced client service team, we have the ability to service the local institutional market in the outmost professional manner."
As with any industry, there always challenges specific to the market which every company has to overcome in order to be successful. Giovanni explains the specific challenges and outside influences which have affected Prudent and the investment fund industry within Luxembourg and Brazil.
"Fundamentally, the bureaucratic red tape is increasingly stifling and costly. Furthermore, investor's flight to the largest money managers is creating a highly concentrated competitive landscape. At Prudent, we are hoping that investment excellence soon again will be determining allocations, rather than the sheer size of the manager's AUM."
Overall, the company has a mission which every member of staff is working towards, and in his concluding comments, Giovanni comments on Prudent's mission, and what steps the team have set in place in order to achieve this.
"Moving forward, the goal for Prudent is to identify and effectuate highly scalable, repeatable, and defensible transactions while utilizing downside risk mitigation strategies, such as insurance, overcollateralization, and extensive client monitoring.
"Needless to say, our colleagues and partners are the key to our success. Lending is a tricky business, and we have had the good fortune of being able to utilize the Brazilian economic slump to lure over highly seasoned professionals when building out the Prudent team. Most of our Senior Associates have more than 30 years of industry experience and bring a wealth of knowledge, endless contact networks, and a good eye for sensible business transactions for us to pursue. Additionally, Prudent strive to build close and strong co-operations with many of its service providers such as CM Capital Markets, which has proven valuable in our efforts to streamline our administrative processes and ensure maximal efficiency."
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SOURCE AltaGroup Agency and Prudent Group