Global investment management firm PIMCO has launched a new fund aiming to help investors address concerns about rising interest rates while providing diversified exposure to credit markets globally.

The PIMCO GIS Diversified Income Duration Hedged Fund will adopt a flexible approach to investing across multiple fixed income sectors, seeking to minimise interest rate risk by focusing on floating and variable rate securities, short-duration securities and combinations of fixed rate bonds and derivative instruments, the firm said in a statement.

The fund is managed by Eve Tournier, executive vice president and portfolio manager focusing on corporate bonds and loans and manager of PIMCO GIS Diversified Income Fund.

“Given the deterioration in sovereign balance sheets and mounting global inflationary pressures, interest rates are likely to move higher over the medium- to long-term horizon. As such, PIMCO has been de-emphasising interest rate risk in favour of a much stronger appetite for credit risk and other sources of 'safe spread' to insulate portfolios from the impact of rising interest rates,” said Tournier.

The fund has been added to PIMCO’s UCITS-compliant Global Investor Series fund range and is registered in Dublin.