Trade finance funds have become more attractive lately. This reason for this isn’t mysterious: investors are looking for non-correlated additions to their portfolios. Trade finance receivables are a plausible candidate for addition.
In a recent conversation, Peter Mulroy, the secretary general of FCI, the world’s largest network of factoring companies, agreed with the hypothesis that institutional investors such as pension managers or endowments might well consider exposure to this class, but he explained, “It’s complicated and it’s not uniform. Many people don’t understand it. But if you do it right it . . .
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