Fermat Capital Management

Description

Fermat Capital Management is an alternative fixed income specialist that treats new asset classes as a way to unlock different sources of return, not as a temporary trend. Founded in 2001, the firm focuses on markets where risk is clearly defined, modelled and, most importantly, potentially rewarded with an attractive premium. By concentrating on these less crowded segments of fixed income, Fermat seeks to deliver income that behaves differently from traditional credit or government bond holdings. At the center of the platform are two strategies, insurance linked securities and trade finance. In the insurance linked space, Fermat invests in instruments such as catastrophe bonds and other securitised insurance risks that transfer the impact of natural disasters and other insured events to capital markets investors. In trade finance, the firm finances short dated, self liquidating receivables, aiming to capture predictable cash flows supported by real world commerce rather than market sentiment. This focus on alternative fixed income is paired with a deep client base that spans pension funds, sovereign wealth funds, endowments, charitable foundations, insurers, family offices and private investors around the world. Portfolios are designed to sit alongside core fixed income allocations, providing diversification, structural yield and exposure to risks that are largely uncorrelated with equity markets or mainstream credit indices. Clear reporting and education help investment committees understand how these strategies behave across different market environments. Research sits at the core of Fermat’s process. The team brings experience in insurance, banking and capital markets and has helped shape the development of the insurance linked securities market since its early years. Quantitative modelling of catastrophe scenarios, detailed analysis of underlying collateral and active monitoring of sponsor behaviour all feed into security selection and portfolio construction. In trade finance, emphasis on credit underwriting, documentation and jurisdictional risk seeks to preserve capital while still harvesting the additional spread available in this part of the market. As climate and cyber risks evolve, Fermat has also partnered with leading analytics and data firms to sharpen its view of complex perils, from real time flood mapping to cyber exposure modelling. The goal is the same across every mandate, to understand the risk with as much clarity as possible, structure it in a way that investors can evaluate, and build portfolios that can seek attractive income while supporting the resilience of the real economy. For institutions looking for fixed income returns with a different set of drivers, Fermat Capital Management offers a focused, research driven approach to alternative risk premiums. The firm’s history in specialist markets, combined with its ongoing work with regulators, data providers and industry partners, positions it as a long term partner for investors who want to expand beyond traditional bonds without losing sight of transparency, liquidity and disciplined risk management.