Brussels-headquartered asset manager Candriam has added the Candriam Bonds Total Return Defensive fund, which was set up last April, to its €3.9bn AuM total return fund range.
The strategy consists of a low duration and unconstrained bond fund seeking to outperform the Eonia + 1% over a two year investment horizon and targeting an ex-ante volatility that does not exceed 2%.
The fund is managed by Damien Martin, who is the lead manager while Nicolas Forest and Alain Peters both act as co-managers.
It invests in the broad fixed income segment, including sovereign bonds, corporate credit and currencies, across both developed and emerging markets.
The fund can hold both negative and positive duration positions, as well as long and short exposure to credit and currency markets.
Duration range of bonds picked for the vehicle varies from -1 to +3 and the maturity limit has been set to 5 years for each issuance and minimum credit rating to BB.
“The core portion of the portfolio includes our short maturity bond picks and represents our convictions in the fixed income market which should enable us to generate return for investors, and the defensive nature of the fund allows us to maintain a relatively liquid portfolio” said portfolio manager Martin.
“We combine this with overlay strategies (implemented through derivatives), to manage duration, credit exposure and currencies. The aim is to also opportunistically and tactically gain exposure to pockets of value in debt markets and especially to hedge the fund against potential drawdowns,” he added.
The Candriam Bonds Total Return Defensive fund is currently registered for marketing in Luxembourg, Austria, Germany, France, Spain and the United Kingdom.
Candriam, owned by New York Life Investment Management (Nylim), has €108bn of assets under management of which €35.2bn are managed in fixed income strategies (i.e. 32% of Candriam’s total AuM).