High yield and corporate credit fund manager Muzinich & Co. has won a £31m joint pension fund mandate from the UK Coal Staff Superannuation Scheme and Mineworkers' Pension Scheme.
High yield and corporate credit fund manager Muzinich & Co. has won a £31m joint pension fund mandate from the UK Coal Staff Superannuation Scheme and Mineworkers’ Pension Scheme.
Muzinich & Co. will run a single global high yield strategy for the funds, which are being switched away from index linked gilts.
Jonathan Storer, secretary to both the pension schemes, said : “This move is part of a wider strategy review aiming to balance risk in these funds. High-yield potentially provides us with performance similar to equities while allowing us to disinvest equities elsewhere, thereby reducing the Schemes’ reliance on equities as the dominant source of expected return.”
“The fund in which we chose to invest gave us access to those skills, good liquidity and confidence that we could protect our capital in weak markets and capture capital gains in stronger markets.”
Joshua Hughes, institutional sales director for Muzinich & Co., said: “This is a very important mandate for us. These pension schemes have switched from index-linked gilts, a traditionally safe-haven. This is a strong vote of confidence in our ability to deliver equity-like returns but with significantly less volatility and downside risk.”
“Investors are increasingly viewing high yield as a long-term portfolio position and the Coal Staff Superannuation and Mineworkers’ Pension Schemes’ mandate is further evidence of this.”