Sterling Extra Yield Bond Fund


Fund overview

The Fund invests in a broad range of fixed interest securities, including investment grade, sub-investment grade and unrated bonds. This combination provides higher yield without taking the degree of risk we believe is generally associated with high yield Funds. It may also hold other transferable securities as well as units in Collective Investment Schemes and cash. The Fund seeks to achieve a gross redemption yield of 1.25 times the gross redemption yield of the FTSE Actuaries British Government 15 Year index, although the Fund itself is not benchmark constrained.

Manager

The fund is jointly managed by Eric Holt and Rachid Semaoune. 

 Eric Holt has extensive knowledge of UK investment grade and high yield corporate bonds, gained over a career spanning more than 30 years. He has overall responsibility for RLAM’s credit research process, as well as managing the Sterling Extra Yield Bond Fund and the Ethical Bond Fund. He joined RLAM in 1999 following Royal London’s acquisition of Refuge Assurance’s investment team, where he had worked for the previous 20 years. Eric is a graduate of Nottingham University with a degree in mathematics and is an associate of the Institute of Actuaries.

 Rachid Semaoune joined RLAM in February 2015 as a Credit Fund Manager within the Fixed Income Team.  Rachid joined from UBS Asset Management where he spent three years managing investment grade credit portfolios.  Prior to this he was a Deputy Credit Fund Manager at Old Mutual Asset Management.  Rachid began his investment career in 2001 at Gulf International Bank where he worked as a Credit Analyst and Deputy Fund Manager. Rachid studied for a PhD in Physics at Imperial College London and holds a Postgraduate Degree in Laser Physics from the Université Paris 13.

Investment approach

The Fund is a well-diversified, value oriented bond Fund that aims to exploit credit market inefficiencies by investing in a combination of investment grade, sub-investment grade and unrated bonds. The managers use their considerable experience of researching and investing in a broader credit universe than many other bond managers, enabling them to source bonds with strong covenants and that are usually secured i.e. backed by a charge on specific assets.

Product Risk Warning

Past performance is not a guide to future performance. The value of investments and the income from them is not guaranteed and may go down as well as up and investors may not get back the amount originally invested. For funds that use derivatives, their use may be beneficial, however, they also involve specific risks. Derivatives may alter the economic exposure of a fund over time, causing it to deviate from the performance of the broader market. Sub-investment grade bonds have characteristics which may result in a higher probability of default than investment grade bonds and therefore a higher risk.