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Standard Life Investments Launches Short-Dated Bond Fund

Josh O'Neill Reporter 31 October 2016

Standard Life Investments Launches Short-Dated Bond Fund

The fund seeks to protect investors against increasing fixed income market volatility.

Standard Life Investments, part of London-listed Standard Life, has launched the Short-Dated Corporate Bond Fund.

Through an actively managed, diversified portfolio of predominantly sterling-dominated bonds, the fund aims to address the potential for drawdown that an increase in fixed income market volatility could bring.

With core government bond yields at a low point, investors have become increasingly worried about the effect that rising interest rates will have on their fixed income allocations, the firm said.

By using a global stock selection process, with a focus on shorter-dated securities, the fund aims to reduce the impact of rising yields, while generating a better return and income than similar maturity government bonds. It will be managed by Daniel McKernan, head of sterling investment grade credit, and Mark Munro, investment director of credit.

“With macro uncertainty increasing and evidence that we are drawing towards the end of a credit cycle, we would expect to see an increase in volatility in both government and credit markets,” said McKernan.

He added: “While short-dated corporate bonds are not immune to any increase in market volatility, we believe that they offer an excellent risk-adjusted option for investors.”

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