Skandia switches fixed income mandates

Skandia Investment Group (SIG) has switched European high-yield bond exposure in three multi-manager funds from Threadneedle to a Nordea offering run by Capital Four Management.

This move came after the group reassessed existing fixed interest holdings post the financial crisis and the downgrading of many subordinated financial bonds.

As a result, the team sold out of Threadneedle’s European High Yield Bond fund and bought the Nordea European High Yield vehicle.

The investment was held in Global Fixed Interest Blend, Bond Income and Diversified funds.

Adam Smears, the head of fixed income research at SIG, says: “Despite being somewhat unknown to UK investors, Nordea is a leading financial services group in the Nordic and Baltic Sea regions and Capital Four has a proven track record managing high-yield fixed interest portfolios. (article continues below)

“Following the financial crisis, many subordinated financial bonds were downgraded to high yield. In common with several other high-yield managers, Threadneedle took the view this is not their core area of expertise and so moved to an ex-financials benchmark. By contrast, Nordea include financials in their investable universe and this is an area where we believe value exists.”