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ii Super 60 - Rathbone Ethical Bond

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ii Super 60 investments:
Rathbone Ethical Bond

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Asset Group Asset Sub-Group Investment Category
Fixed Income Sterling bonds Adventurous

Selection rationale:
Rathbone Ethical Bond has a higher income target than most of its peers and currently yields 3.6%. Income is paid quarterly. Bryn Jones has run this fund since 2004 and was joined by assistant manager Noelle Cazalis in 2016. They invest predominantly in investment-grade bonds. They use an approach that considers economic and political trends, company analysis and thematic ideas. Once investment themes have been developed, Jones and his team look for the best bonds to buy within that framework.

When assessing which companies’ bonds to buy, the managers use the ‘four Cs plus’ process to help make their selections. These are: character (management’s ability to react to events); capacity (sources of liquidity and cash-flow analysis); collateral (assets that are pledged); and covenants. The ‘plus’ is conviction: Jones believes that in order to achieve long-term, above-average performance, he must think differently from the market.

Rathbone Greenbank, the company’s ethical investment unit, then applies an ethical screen. Exclusions are simple: no mining, arms, gambling, pornography, animal testing, nuclear power, alcohol or tobacco, which rules out about one third of their universe. All positions must also have at least one positive environmental, social or corporate governance quality. Jones welcomes this ethical overlay, regarding it as an extra level of investment diligence.

September 2020

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Risk warnings

Past performance of the underlying constituents is not a guarantee of future performance. The value of investments, and any income from them, can fall as well as rise so you could get back less than you invest. 

Annual performance can be found on the factsheet of each fund, trust or ETF. Simply click on the asset’s name and then the performance tab. 

The information we provide in the ii Super 60 investments list is an opinion provided by ii or one of its partners on whether to buy a specific investment. Please note that none of the opinions we provide are a “personal recommendation”, which means that we have not assessed your investing knowledge and experience, your financial situation or your investment objectives. Therefore you should ensure that any investment decisions you make are suitable for your personal circumstances.

If you are unsure about the suitability of a particular investment or think that you need a personal recommendation, you should speak to a suitably qualified financial advisor. 

Any changes to the ii Super 60 investments list and the rationale behind those decisions will be communicated through the Quarterly Investment Outlook.

Details of all recommendations issued by ii during the previous 12 month period can be found here.

ii adheres to a strict code of conduct. Members of ii staff may hold shares in companies mentioned in the ii Super 60 investments list, which could create a conflict of interest. Any member of staff intending to complete some research about any financial instrument in which they have an interest are required to disclose such interest to ii. We will at all times consider whether such interest impairs the objectivity of the recommendation.

In addition, staff involved in the production of this ii Super 60 list are subject to a personal account dealing restriction. This prevents them from placing a transaction in the specified instrument(s) for five working days before and after an investment is included or amended and made public within the list. This is to avoid personal interests conflicting with the interests of the recipients of this ii Super 60 investments list.