Royal London Global Bond Opportunities Fund Class Z GBP
New for 2019. Seeks a high yield from bonds globally
Royal London Global Bond Opportunities has only been going since 2015, but boasts one of the strongest performances in its official sector, sterling strategic bond. The fund offers a high level of income – its current yield is 5.8% – as well as the opportunity for capital growth.
The fund is run by Eric Holt, a fixed income sector veteran, and Rachid Semaoune. Holt has extensive knowledge of investment-grade and high-yield corporate bonds, gained over a career spanning more than 30 years. He has overall responsibility for Royal London Asset Management’s credit research process. Semaoune joined Royal London’s fixed income team in 2015 and has 18 years’ experience in credit markets.
With this fund, the pair run a very well-diversified fund of almost 200 holdings with a focus predominantly on credit markets internationally.
US and European debt account for more than two thirds of the portfolio, with smaller allocations to bonds issued in Norway and Sweden. UK debt accounts for less than one quarter.
In terms of credit quality, the managers have a preference for high yield and unrated bonds. These areas of the market accounted for almost 80% of the fund’s £100 million of assets at the end of 2018.
The managers believe that current pricing of corporate bonds is still attractive over the medium term, while the level of income generation is also appealing. Credit valuations are underpinned by strong company balance sheets and a low default rate environment, which is pushing investors to broaden their search for yield, they say.
The fund’s ongoing charges are a very competitive 0.49%.
Narrative and ratings content all as of 01 January 2019.See all Money Observer rated funds
|Credit Agricole S.A. 8.38%||2.11 %|
|867176 Cds Eur P F 5.00000 Cds 20220620 Hsbc S||2.08 %|
|ML 33 Holding AS 5.5%||1.93 %|
|867176 Cds Eur R V 03mevent Cds 20220620 Hsbc L||1.92 %|
|Point Resources AS 8.5%||1.91 %|
|AG Insurance SA/NV 6.75%||1.64 %|
|Societe Generale S.A. 9.38%||1.58 %|
|Jacktel AS 7%||1.50 %|
|EI Group Plc 6.38%||1.45 %|
|Groupama Assurances Mutuelles 7.88%||1.42 %|
Eric joined Refuge Assurance’s investment team in 1979, having been initially recruited into the Actuarial department. He has overall responsibility for RLAM’s credit research process and has extensive knowledge of UK corporate bonds, which has been his main focus for twenty years. Eric is a graduate of Nottingham University with a degree in mathematics and is an associate of the Institute of Actuaries.
Data provided by Morningstar.
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