The Japanese investment house is launching a UCITS vehicle registered in Luxembourg and investing in global credit.

Nikko Asset Management, the Japan-headquartered firm with $154.9 billion of assets under management, is launching the Luxembourg-domiciled Global Credit UCITS fund tomorrow.

The fund is managed by Holger Mertens, who is head portfolio manager. He is supported by global credit teams working from London, Tokyo, Singapore, Sydney, Auckland and New York.

The fund aims to target an excess return of 1.5 per cent against the Barclays Global Aggregate Corporate Index and also has an absolute return target of 4 per cent. It will invest worldwide in a portfolio of 70-120 corporate bonds. The team adopts an active investment approach based on fundamental research, aiming to capture mispricings in global credit markets, Nikko said.

“We are launching the fund in response to investor need for consistent and sufficient returns in a low yield environment through a diversified and high quality credit portfolio. The need is increasing for a highly skilled active fund management team with truly global resources, and experience in different regions of the world,” said the firm's head of global fixed income, Andre Severino.

The launch comes after the rollout of Nikko's Japan Focus Equity UCITS and its Asia ex-Japan, Global Equity and Multi-Asset UCITS in 2015.