Invesco has launched what it claims is the first fixed income fund for investors to buy into investment opportunities driven by China’s ‘Belt and Road’ (B&R) initiative.
The Invesco Belt and Road Debt Fund will seek long-term returns by integrating a thematic approach and aims to benefit from capital gain potential across regional bond markets fuelled by the strategy – set up in 2013 to promote land and sea connectivity in Asia, Europe, the Middle East and Africa.
The fund will invest primarily in USD sovereign bonds, investment grade and high-yield corporate bonds from select issuers that could directly or indirectly benefit from increasing capital and trade flows, catalysed by the B&R initiative.
It can invest up to 10% in equities from the B&R initiative region. Strong risk mitigation is enforced to cap forward-looking volatility most of the time, with the ability to tactically raise cash up to 30% in anticipation of rising market risks.
Sergio Trezzi, head of retail distribution for Emea (ex-UK) and Latin America, said: “Demand for thematic investment is growing in the European markets, in particular in the wealth management channel, considering the longer-term investment opportunities coming from macro, social and cultural trends.”
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