Tokyo-headquartered Nomura Asset Management’s Nomura Corporate Hybrid Bond Fund has surpassed $500 million in assets under management (AuM) on its second anniversary.
The milestone highlights how more investors are turning to corporate hybrid debt as a way to secure reliable income, especially at a time when the broader economic outlook remains uncertain.
The corporate hybrid bond market also received a significant boost when Moody’s increased the equity credit it assigns to corporate hybrid bonds from US issuers from 25% to 50% early in 2024. This change led to a marked increase in issuance from US companies and has contributed to the overall market surpassing $300 billion in size.
Launched in August 2023, Nomura’s Corporate Hybrid Bond Fund focuses on institutional and wholesale investors, targeting yield opportunities from investment-grade non-financial issuers in Europe and other developed markets.
Nomura launches first Euro corporate hybrid bond fund
Julian Marks, head of hybrid bonds, Nomura Asset Management, commented: “Corporate hybrids are continuing to mature as an asset class. Investors are recognising the high quality of the issuers, the defensive characteristics of the structure and their attractive spreads over senior debt.
Surpassing $500 million AUM in just two years demonstrates that investors value our disciplined, bottom-up approach and strong issue selection-led track record. I would like to thank our investors for their continued support.”
Doug Stewart, head of distribution, Emea, added: “Wealth and institutional clients across Europe have shown strong interest in corporate hybrids and the growth of the Nomura Corporate Hybrid Bond Fund is testament to the excellent reputation Julian Marks and Kapish Patel enjoy in this asset class. This strategy is fast becoming a cornerstone allocation for investors seeking stable income with a conservative risk profile.”
The fund is co-managed by Julian Marks and Kapish Patel.
