M&G Investments, a division of M&G plc, has launched the M&G Global Corporate Bond Fund in response to UK investors’ demand for large-scale bond diversification.
The asset manager noted a resurgence in fixed income allocations due to attractive yield opportunities amidst high interest rates and inflation, leading to increased volatility. With the global bond market valued at $127 trillion, surpassing the equity market’s size threefold, active managers with strong investment expertise have ample opportunities for value discovery and portfolio diversification through active credit selection, they added.
Bond ETFs: Mastering today’s market
Available to UK investors actively seeking to diversify their fixed income allocations to maximise the potential for returns outside the UK market, the M&G Global Corporate Bond Fund has launched with £164 million of external investment.
Benchmarking the Bloomberg Global Aggregate Corporate Index (GBP Hedged), the fund is managed by Ben Lord and Mario Eisenegger.
Jim Leaviss, M&G’s CIO of fixed income, commented: “With a wall of cash waiting to re-enter the market after last year’s high interest rates and continued inflation concerns sparking further interest rate reductions, a boom in the US bond markets looks likely. If the Federal Reserve cuts rates as early as March, this could trigger falling bond yields and lock in significant gains for early investors.”
Fixed income investors show heightened risk appetite
Alex Matcham, head of UK wholesale, added: “After more than 10 years of strong performance for our European clients, we are pleased to bring this fund to the UK market.
Global market dynamics have put fixed income allocations back on the table for UK wealth managers increasingly looking to diversify away from the UK bond markets.”
