As 2014 drew to a close, a multi-strategy hedge fund in the US mid-west was puzzling over the performance of its credit strategies. The firm had been deeply pessimistic about credit markets for some time, and told its clients as much in a series of gloomy investor letters. Despite this, its credit strategies were consistently beating expectations. Now, some of its investors wanted to know why.
"We were scratching our heads," says a partner at the firm. "We eventually realised we had slipped into
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