London-based boutique Sanlam Four is set to add the Sanlam Strategic Bond Fund to its fund range.
Craig Veysey, the manager of the Sanlam Strategic Bond Fund since inception in March 2012 and current head of Fixed Income at Sanlam Private Wealth, will move over to Sanlam Four.
Formerly Veysey has managed global bond funds and other bond portfolios at Scottish Widows Investment Partnership, WestLB Mellon Asset Management and HSBC Investment Management.
The Sanlam Strategic Bond Fund invests mainly in attractively priced investment grade government and corporate bonds. It may invest up to 20% in high yield bonds, and have a non-sterling unhedged currency exposure up to 20%.
The fund’s core positions typically comprise 70% to 80% of the portfolio to which the manager adds an actively managed tactical overlay strategy.
Veysey explained: “We took a hard look at the Strategic Bond sector almost five years ago and realised there was an opportunity for a differentiated product. We believe investors want preservation of capital from their bond investments but still with an attractive yield, which can be delivered on a monthly basis. The fund’s active approach to investing in undervalued bonds across the mainly higher credit quality bond universe has allowed it to deliver sector-leading returns with low volatility.”
The manager believes there is still opportunity given the potential for disappointment on global growth and the current elevated government and household debt levels.
Veysey added: “As we have found in recent years, expectations and reality have often diverged significantly in government bond yields, and we will need to see considerable further evidence to the contrary to become bearish more generally on government bonds.”
The Sanlam Strategic Bond Fund has returned +38.6% since inception to 31 December 2016, against 26.8% for the IA £ Strategic Bond sector over the same period, according to Morningstar figures.
Sanlam Four has £4.3bn (€4.99bn) in assets under management.