Rathbones has launched a global bond fund that will invest predominantly in bonds at the lower end of the risk spectrum.
The Rathbones High Quality Bond fund will be managed by Noelle Cazalis.
It is the first time Ms Cazalis acts as lead manager on a fund, though she has previously worked alongside fixed income head Bryn Jones on the £1.3bn Rathbones Ethical Bond fund.
The fund will aim to have 80 per cent of the capital invested in bonds that have a credit rating of A - or higher, out of a highest achievable rating of AAA+.
The remaining 20 per cent can be invested at the discretion of the fund manager.
The fund will make quarterly income payments and has an ongoing charge of 0.5 per cent.
Ms Cazalis said: “As the outlook for rates is uncertain and as we near the back end of the credit cycle, we aim to provide a cautious option within fixed income portfolios.
"We believe investors only have a limited number of options to de-risk, so the fund should add to their tool-kit.
"By focussing on high quality credit names, the fund should help to limit maximum drawdowns in portfolios when markets are jittery. In the meantime, the yield offers a meaningful pick-up versus cash.”
Patrick Connolly, head of communications at advice firm Chase De Vere, said: “This could be a good option for investors who want to add more security and capital protection to their portfolios.
"Noelle Cazalis is part of an impressive fixed income team alongside Bryn Jones at Rathbones and the fund also has competitive charges.
"However, many ‘safer’ fixed interest assets look expensive, which means that the fund will have a low yield and probably limited scope for capital returns.”
david.thorpe@ft.com
