UK-based PSigma Investment Management and TwentyFour Asset Management have launched a TwentyFour Focus Bond Fund - a vehicle which will start with nearly £50 million (around $75 million) in assets.

The fund has been specifically designed to generate a more predictable return for investors, and it will seek to do by only picking bonds expected to redeem by 2016. By targeting a redemption window in this way, investors can expect to achieve a relatively stable level of income and at the same time minimise the “duration risk” inherent in most other fixed interest funds, the firms believe.

“The mispricing that has occurred in credit markets due to the chaos in European bond markets has left the relative and absolute yields on offer from corporate credits very attractive,” said Thomas Becket, chief investment officer of PSigma.

The fund will hold around 50-60 bonds and at launch will have an average rating of BBB, holding 30 per cent in high yield and no more than 20 per cent in the financial sector. It aims for a yield of about 7 per cent net of charges.