Royal London Global Bond Opportunities Fund Class Z GBP

Global Bonds

Rated Fund 2019-20. Seeks a high yield from bonds globally

This fund has slightly underperformed its official sterling strategic bond fund sector over the past year but outperformed significantly over three years. Its high yield of 5.6% makes it a good option for those seeking quarterly income, and it has a growing following – it has more than doubled in size to £200 million over the past year. 

Eric Holt, a fixed-income sector veteran, and Rachid Semaoune have run this fund since it launched in 2015. Holt has extensive knowledge of investment-grade and high-yield corporate bonds gained over a 40-year career. 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 almost 20 years’ experience in credit markets.

The pair run a very well-diversified fund of more than 200 holdings that focuses mainly on credit markets internationally. US and European debt account for more than 70% of the portfolio. UK debt accounts for around 20%. In terms of credit quality, the fund prefers high-yield and unrated bonds.

The managers believe that present pricing of corporate bonds is still attractive over the medium term, while the level of income being generated is also appealing, given the prospect of short-term interest rates staying lower for longer. They say 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.

Narrative and ratings content all as of 01 January 2020.

See all Money Observer rated funds
Name
Royal London Global Bond Opportunities Fund Class Z GBP
Manager
Royal London Unit Trust Managers Ltd
Type
Open Ended Investment Company
ISIN
IE00BYTYX230
Sector
£ Strategic Bond
Launched
08/12/2015
OCF
0.5 %
Risk Rating
5
3 Year Sharpe
2.66
3 Year Alpha
5.22
Yield
5.8 %
Benchmark
IA Sterling Strategic Bond
The investment objective of the Fund is to achieve a high level of income with the opportunity for capital growth. The Fund seeks to achieve its investment objective by investing predominantly in non-Sterling and Sterling denominated fixed income securities, as described further below, issued globally, including in Emerging Markets. The Fund seeks to achieve its investment objective by investing its assets in a diversified portfolio of global fixed or floating rate debt securities (rated or non-rated), including investment grade, sub-investment grade or high yield. The Fund may also invest in preference shares.
Holding %
DigiPlex Norway Holding 2 AS 5.26% 1.78 %
ML 33 Holding AS 5.5% 1.77 %
GLH HOTELS LIMITED 7.88% 1.54 %
Credit Agricole S.A. 8.38% 1.40 %
Prudential plc 3.88% 1.23 %
HAVILAFJORD AS 6.52% 1.22 %
Stichting AK Rabobank Certificaten 6.5% 1.13 %
867176 Cds Eur P F 5.00000 Cds 20220620 Hsbc S 1.09 %
Bank of Scotland Capital Funding LP 7.75% 1.05 %
EI Group Plc 6.38% 1.03 %
Region %
United Kingdom 100.00 %
Sector %
Financial Services 100.00 %
Name
Royal London Unit Trust Managers Ltd
Address
EC3V 0RL, London, United Kingdom
UCITS
Yes
Legal Structure
Open Ended Investment Company

Managers

Rachid Semaoune
Joined 12/08/2015
Eric Holt
Joined 12/08/2015

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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