Rathbone Ethical Bond Fund Institutional Acc

Sterling Bonds

Rated Fund 2013-19. A competitive yield from ethical investment-grade bonds

Rathbone Ethical Bond ranks highly among corporate bond funds and deserves to retain its place. ­The fund was named Money Observer’s Best Ethical/SRI Bond Fund in 2015, 2016 and 2017. It has a higher income target than most of its peers and currently yields 4.4%. Bryn Jones has run this fund since 2004. He was joined by assistant manager Noelle Cazalis in 2016. ­They mostly invest in investment-grade bonds using an approach that takes into account economic and political trends, company analysis and thematic ideas. Jones and his team look for the best bonds to buy within the thematic framework.

When assessing which companies’ bonds to buy, the managers use the ‘four Cs plus’ process to help them make selections. ­These are: character (management’s ability to react to events), capacity (sources of liquidity and cash-flow analysis), collateral (assets that are pledged), and covenants. ­The ‘plus’ is conviction: Jones believes that in order to achieve long-term, above-average performance, he must think differently from the market.

Rathbone Greenbank, the company’s ethical investment unit, then applies an ethical screen. All positions also have at least one positive environmental, social or corporate governance quality. Jones welcomes this ethical overlay, regarding it as an extra level of investment diligence.

FundCalibre, the fund ratings and research provider, rates this an ‘Elite’ fund. “It has managed to outperform regardless of its ethical constraints, illustrating that income and ethics can be combined without sacrifice,” says managing director Darius McDermott.

Narrative and ratings content all as of 01 January 2019.

See all Money Observer rated funds
Name
Rathbone Ethical Bond Fund Institutional Acc
Manager
Rathbone Unit Trust Management Limited
Type
Unit Trust
ISIN
GB00B77DQT14
Sector
£ Corporate Bond
Launched
01/03/2012
OCF
0.67 %
Risk Rating
2
3 Year Sharpe
1.45
3 Year Alpha
3.15
Yield
3.9 %
Benchmark
Markit iBoxx GBP NonGilts TR
The objective of the fund is to provide a regular, above average income through investing in a range of bonds and bond market instruments that meet a strict criteria ethically and fnancially
Holding %
RL Finance Bonds No. 3 plc 6.12% 1.96 %
Rothesay Life PLC 8% 1.78 %
HSBC Capital Funding (Sterling 1) L.P. 5.84% 1.72 %
Bank of Scotland Plc 7.28% 1.71 %
BPCE SA 5.25% 1.68 %
Cooperatieve Rabobank U.A. 6.91% 1.67 %
AXA 5.45% 1.65 %
European Investment Bank 0.84% 1.64 %
Aviva Plc 5.9% 1.62 %
Lloyds Bank plc 13% 1.62 %
Region %
United Kingdom 100.00 %
Sector %
Financial Services 100.00 %
Name
Rathbone Unit Trust Management Limited
Address
W1J 5FB, London, United Kingdom
UCITS
Yes
Legal Structure
Unit Trust

Managers

Bryn Jones
Joined 11/01/2004

Bryn is the Head of Fixed Income for Rathbones, and is lead manager on the Rathbone Ethical Bond Fund, the Rathbone Strategic Bond Fund and manager of intuitional mandates. He joined Rathbones in November 2004 from Merrill Lynch, where he managed $2 billion of fixed income assets. Bryn is a member of the Rathbone Strategic Asset Allocation Committee, Non-Executive Chairman of Rathbones' Fixed Income Committee, and an adviser to the Rathbone Banking Committee. He is a WMA representative for the HMT DMO’s (Her Majesty’s Treasury - Debt Management Office) Gilt market consultation process. He has been a guest speaker at the Euromoney Bond Conference in London, and at the Euromoney Bank Capital Conference in Amsterdam. Bryn appears regularly on CNBC and Bloomberg TV. He also sits on the IA Fixed Income Committee. Bryn graduated from Birmingham University with a Bachelor of Arts degree in Geography in 1995. Bryn’s Rathbone Ethical Bond Fund was awarded Best Sterling Corporate Bond Fund at the Morningstar UK Fund Awards 2014; Best SRI Bond Fund at the Money Observer 2015 Fund Awards; the Rathbone Ethical Bond Fund is also a top performer in the Bond Pound Sterling – Corporates sector over 3 and 5 years in the UK (Lipper Fund Award 2015) and was ‘Highly Commended’ at the 2015 Moneywise Awards. In 2018 the Ethical bond fund won the prestigious Judge’s Choice fixed Income fund award at the Investment Week awards. His Rathbone Strategic Bond fund was voted best Multi-Asset Fixed Income Strategy at the Investment Week Specialist Investment Awards 2015.

Data provided by Morningstar.

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