Systematic Fixed Income
The Axonic Systematic Arbitrage Strategy specializes in fixed income markets. This strategy takes advantage of dislocations in relative prices and volatility of interest rate derivatives. The market-neutral strategy gives investors an exposure to a unique combination of diversified fixed income sub-markets. Through this diversification, the strategy has been able to generate returns uncorrelated to common risk factors.
Our approach is rooted in taking advantage of observable market behavior and fundamental economic intuition. We utilize pair trades, in which a long and short position are taken in two securities. Timing and sizing of these positions are determined using at least two of five “alpha” signals: carry, sentiment, momentum, mean-reversion, and seasonality. Our systematic approach in analyzing these signals is combined by a close human oversight in execution.
Opportunities and Trends
Our core investment themes aim to locate relatively mispriced instruments through various factors: momentum, trends in sentiment, and seasonality in certain derivative pricing patterns. We also take advantage of carry trades, in which an investor receives a premium for providing certain protections. These themes have proven to perform through various market environments and we expect they will continue to provide alpha to investors.
Each of these themes is impacted by variables such as market sentiment, volatility, and the structural features of fixed income derivatives markets. We believe that Axonic’s depth of experience in these areas provides a sustainable competitive advantage for our firm.
We focus exclusively in the structured credit space and have since the inception of Axonic. We pass this edge on to our investors with fixed income investments that often provide enhanced returns and diversification away from the broader public markets.
Most of our executive leadership team has been together since the inception of our firm. This provides our investors with a cohesive client experience and a unique business model that has withstood market ups and downs.
An unwavering long-term view is critical to overcoming the inevitable highs and lows in market cycles. Remaining calm, relying on data and resisting the urge to react from emotion is what makes Axonic exceptional.
Combined, our firm has hundreds of years of experience in structured credit. No one is a generalist; we are all focused on our specific practice sectors that gives our team the potential of surpassing the broader markets.
For more information about our historical performance and examples of investment opportunities, please contact us. Please note this information is only available to accredited investors and qualified purchasers.