US investment firm Federated Investors is adding a trade finance-focused section to its London office with the relocation of portfolio manager Christopher McGinley from the US.

The firm is also hiring three new people to work specifically on trade finance products, Dalia Kay, Patrick Bayliss and Antriksh Gautam, all from GML Capital.

This is the first time that Federated has been independently involved in trade finance, its previous involvement being in partnership with GML Capital.

“Now we can really say this is our own thing. We’re really excited about have direct control over it,” Federated’s chief investment officer, Robert Ostrowski explains to GTR.

Federated is fairly new on the trade finance scene, Ostrowski comments: “We did our first international transaction back in 2007 and we began to augment some of our traditional portfolios in this area.”

“We came out with a core fund in August of 2009 to allow our own federated portfolio to participate more broadly in the asset class.”

The company has traditionally focused on mutual funds, which operate in stocks and bonds.

Trade finance, however, offers very attractive low duration returns, Ostrowski explains.

Federated previously made this fund available within the company only but, with the expansion of the London office, will be offering the fund on the open market.

As well as McGinley, who has been involved in the trade finance operation since the beginning, the firm is recruiting Dalia Kay as a vice-president. Kay was previously trade finance portfolio manager at GML Capital and led the firm’s entry into the origination and distribution of trade finance transactions.

Bayliss is also joining from his GML position of trade finance portfolio manager to become a vice-president at Federated.

Gautam is coming in as a consultant to Federated, focusing his efforts on structured finance and underwriting. He was previously a GML trade finance portfolio manager.