Axa Investment Managers has announced is launching a fixed-term US high yield bond fund, which will be managed by head of US fixed income Carl ‘Pepper’ Whitbeck.
The AXA IM Maturity 2022 fund, which will self-liquidate at the end of February 2022, targets an annualised gross return of 4 to 7 per cent in US dollars.
Whitbeck says: “In this slow growth, low interest rate environment, we believe that active fund managers in the US high yield asset class can deliver mid-to-high single digit annualised returns by collecting coupons and avoiding defaults.”
“It is almost impossible to time the market so this fund, which has a pre-determined investment period, may help to alleviate that investor concern by mitigating market and interest rate risk.”
Whitbeck adds that the fund is designed to be held until the maturity date.
The fund will take a “prudent approach” to credit selection with a strict sell discipline applied if any issuer’s credit fundamentals deteriorate.
“We aim to avoid speculative bonds in the portfolio in an attempt to take risks that we can analyse and manage. Our focus is firmly on avoiding defaults.”