Morgan Stanley Investment Management has launched a fund which will target bonds with a maturity of up to four years.
The Morgan Stanley Investment Funds Global Buy and Hold 2020 Bond fund will invest in government bonds, investment grade, high yield corporate bonds and emerging market debt, with a maturity of four years. It also aims to provide a “regular” income over four years.
The fund is a Luxembourg-based Sicav and will be available to investors in the UK, France, Spain and Italy with the euro its base currency.
The investment strategy will use a quantitative modeling and fundamental analysis and will not be tied to a benchmark.
Fund managers, Jim Caron, Marco Spaltro, Leon Grenyer and Joseph Mehlman from the firm’s global fixed income team will be responsible for the new fund.
Caron says: “For investors seeking a stable source of income in the current climate of lower yields that is vulnerable to bouts of higher volatility, we believe this fund is very attractive because it can serve to reduce volatility and increase diversification of income in one’s portfolio.
“In the current low interest-rate environment, the search for yield from fixed income products has intensified, and this fund may provide a solution to meet the demand from investors looking for an alternative to European government bonds or other kinds of non-diversified fixed income exposure.”
The fund charges 0.49 per cent.