Royal London Global Bond Opportunities Fund Class Z GBP

Global Bonds

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
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
1.97
3 Year Alpha
6.65
Yield
6 %
Benchmark
N/A
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 %
867176 Cds Eur P F 5.00000 Cds 20220620 Hsbc S 3.34 %
867176 Cds Eur R V 03mevent Cds 20220620 Hsbc L 2.96 %
EI Group Plc 6.38% 1.73 %
ML 33 Holding AS 5.5% 1.59 %
Credit Agricole S.A. 8.38% 1.54 %
Delta Lloyd Levensverzekering NV 9% 1.44 %
Credit Agricole S.A. 6.62% 1.42 %
Aquarius plus Investments Plc 8.25% 1.40 %
Amedeo Air Four Plus 1.31 %
Centrica plc 3% 1.30 %
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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