Standard Life Investments has launched a short-dated corporate bond fund, which aims to reduce the impact of rising yields, while still targeting a better return and income than similar maturity government bonds.
The fund intends to address the potential for significant drawdown that an increase in fixed income market volatility could bring through an actively managed, diversified portfolio of predominantly sterling-denominated corporate bonds with a maturity of less than five years.
It is managed by Daniel McKernan, head of Sterling Investment Grade Credit, and Mark Munro, investment director of Credit. It will be available as an OEIC and complements the existing suite of corporate bond funds across the Standard Life OEIC range
“With macro uncertainty increasing and evidence that we are drawing towards the end of the credit cycle, we would expect to see an increase in volatility in both government and credit markets. While short-dated corporate bonds are not immune to any increase in market volatility, we believe that they offer an excellent risk-adjusted option for investors,” McKernan said.