Winner of the ‘Best Credit Hedge Fund – Credit Long/Short’ Category at the 2023 Hedgeweek & Private Equity Wire European Credit Awards
In the dynamic world of credit investment, staying ahead of the curve requires a blend of experiential wisdom and technological prowess. Drakai Capital, a Paris-based investment management firm, epitomises this blend by fusing technology with credit investing to generate consistent, low-volatility alpha. We sat down with the firm’s leaders to delve into their unique approach and the burgeoning potential of systematic credit.
Q: Systematic credit is garnering attention among investors. How does Drakai Capital position itself in this sphere?
A: At Drakai Capital, we seamlessly combine technology with credit investing to navigate market complexities. Our systematic credit strategy is grounded in rigorous scientific analysis and technological innovation, which enables us to consistently generate low-volatility alpha. By focusing on liquid and clearable instruments across the US and Europe, we construct diversified portfolios that are highly additive to our investors’ portfolios. Our cross-asset approach, bolstered by our extensive experience in credit and equity derivatives, is a unique aspect of our offering.
Q: The methodology in systematic credit trading is often seen as intricate. Can you walk us through Drakai Capital’s approach in simplifying this process?
A: Absolutely. Our methodology is a three-pronged approach. First, we acquire and enhance data by incorporating industry expertise, making it clean and insightful. Next, we delve into building and testing algorithmic models to unearth strong alpha signals and construct diversified portfolios. Lastly, with our technological infrastructure we ensure best credit execution in the market. While the automation in executing these strategies has room for improvement, our approach reduces human bias and identifies greater opportunities in credit investing.
Q: The transition towards electronic trading platforms has been pivotal in systematic credit’s evolution. How does this impact your strategy?
A: The digital transformation has indeed been a catalyst in the systematic credit domain. It has opened up a realm of structured data, allowing for more precise analysis and execution. Our strategy leverages this digital shift to enhance trade transparency and reduce human bias, positioning us to exploit market inefficiencies more effectively.
Q: Drakai Capital has recently been honoured with the ‘Best Credit Hedge Fund – Credit Long/Short’ award. How does this accolade resonate with your firm’s ethos?
A: This prestigious award is a testament to our meticulous approach in systematic credit investing. It reflects our industry acumen, innovative strategies, and the relentless pursuit of delivering superior value to our investors. It further reinforces our standing in the industry, embodying our commitment to excellence in the systematic credit arena.
Q: Drakai Capital’s green initiatives are quite commendable. How do these reflect in your operational ethos?
A: Drakai Capital believes that every single step matters in the fight against climate change. We aim to balance our carbon footprint through various climate action projects. As a responsible company, Drakai Capital plants a tree for every trade and every investor subscription. While Drakai Capital is fervently committed to climate action, our investment process do not specifically target ESG objectives.
Q: What message would you like to convey to prospective clients and investors about Drakai Capital’s systematic credit offerings?
A: Drakai Capital is among a very select group of firms with a pure-play, market-neutral, and cross-asset quantitative credit strategy. Our objective is to provide a unique investment avenue that harnesses the power of systematic credit to achieve consistent, uncorrelated alpha. We invite professional investors to explore this innovative landscape with us, as we continue to push the boundaries of credit investing.
Guillaume Boulanger, Chief Risk Officer and Chief Operating Officer, Drakai Capital – Guillaume’s journey in the financial domain, beginning in 1998, has seen him at the helm of risk management and structured credit roles across reputable global firms like Morgan Stanley, Citigroup Global Markets and Merrill Lynch/Bank of America. His expertise further crystallised as a Portfolio Manager at AXA Investment Managers, pioneering in credit-equity volatility arbitrage strategy. Transitioning into entrepreneurship in 2017, Guillaume ventured into real estate. A distinguished graduate from ENSAE Paris and a certified actuary, Guillaume now significantly contributes as the Chief Risk Officer and Chief Operating Officer at Drakai Capital, blending his profound expertise with strategic oversight to navigate the intricate systematic credit landscape, ensuring operational rigor and risk-adjusted returns for investors.
Samer Comair, Chief Investment Officer and Chief Executive Officer, Drakai Capital – Samer’s financial acumen was initially honed as a corporate M&A specialist at Credit Suisse First Boston (London) and Deloitte, where he focused on capital structure modelling, debt and equity-linked instrument issuance, M&A valuation analysis, and structuring and financing leveraged buyouts (2001-2004). Before establishing Drakai Capital, Sam dedicated 15 years (2004-2019) at Société Générale’s proprietary trading desks, initially as a credit derivatives trader, then advancing as a quantitative portfolio manager spearheading capital structure arbitrage and cross-asset absolute return strategies across European and U.S. markets. Driven by data and model-centric systematic strategies, Sam adeptly crafts diversified portfolios utilizing a broad spectrum of financial instruments, including credit default swaps, bonds, convertibles, stocks, futures, and options. He is a distinguished engineering graduate from École Polytechnique (Palaiseau, France).