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ii Super 60 - Royal London Global Bond Opportunities

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ii Super 60 investments:
Royal London Global Bond Opportunities

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

Selection rationale:
This fund has slightly underperformed the IA sterling strategic bond sector over the past year but has demonstrated strong returns over a three-year period. The strategy has a yield of 5.7%, which makes it a suitable option for those seeking income. The fund has more than doubled in size up to £200 million over the last 12 months.

Eric Holt, a fixed income sector veteran, and Rachid Semaoune have run this fund since it launched in late 2015. Holt has extensive knowledge of investment grade and high yield corporate bonds, gained over a career spanning 40 years. He has overall responsibility for Royal London Asset Management’s credit research process. Semaoune joined Royal London’s fixed income team in 2015 and has almost 20 years’ experience in credit markets.

With this fund, the pair run a well-diversified portfolio of more than 200 holdings, predominantly focusing on international credit markets. US and European debt account for more than 70% of the portfolio. UK debt accounts for around 20%. In terms of credit quality, the fund prefers high-yield and unrated bonds.

The managers believe that present pricing of corporate bonds is still attractive over the medium term, while the level of income generation is also appealing given the prospect of short-term interest rates staying lower for longer. Credit valuations are underpinned by strong company balance sheets and a low default rate environment, which is pushing investors to broaden their search for yield, they say.

January 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.