Interval Funds

Jun 24. 13:45

Monachil Capital Partners, LP Registers the Monachil Credit Income Fund

Monachil Capital Partners, LP Logo

Monachil Capital Partners, LP registered the Monachil Credit Income Fund (the "Fund") on 6/21/21, which will focus on providing investors with current income and attractive risk-adjusted returns. The Fund intends to generate returns by investing in a wide array of credit instruments and asset-backed securities, including securities that are not otherwise freely tradable in the United States (via investments placed by a subsidiary, Wolf River Cayman, Ltd.).

According to the Fund's prospectus, the Fund is seeking to offer returns with low correlation to both the public equity and fixed income markets – a timely filing given changing interest rates and a push from fixed income investors to seek out better yields without exposing themselves to major downside risk.

In a somewhat unusual move, this Fund was not launched "from scratch" but was formed by reorganizing an existing fund, Wolf River INV LLC, that commenced operations less than a year ago. This Predecessor Fund maintained an investment objective, strategies and policies that are, in material respects, equivalent to those of the current Fund, shares the same adviser and portfolio manager, and transferred substantially all of its assets into this Fund upon reorganization. The Fund's prospectus does not explain a rationale for the reorganization.

The Monachil Credit Income Fund is initially launching Class I shares with a minimum initial investment of $1m, and upon receiving SEC approval, intends to launch a separate share class (Class A) with a minimum initial investment of $2,500. Aside from the standard management and shareholder servicing fees, the Fund will charge an upfront sales load of up to 5.75%, and if the Fund hits certain performance targets, it will pay the adviser an incentive fee of up to an annualized hurdle rate of 6.00%. 

Alston & Bird LLP serves as legal counsel to the Fund.