Royal London Asset Management has rolled out a credit fund that holds investment-grade debt across a range of maturities and uses derivatives to curb the effect of interest rate variations.

The new offering is called the Royal London Duration Hedged Credit Fund, following the rollout of the Royal London European Corporate Bond Fund in August.

The new fund, aimed at meeting the needs of groups such as pension funds, is designed to help investors manage liabilities. It is open to investors committing at least £1 million (about $1.6 million) and is structured as a UCITS IV-compliant fund. (Such a fund could be held by investors via a private bank, for example, this publication was told by RLAM.)

The UK-domiciled fund is managed by Paola Binns and Shalin Shah of RLAM’s fixed interest team and targets an annual return of 2 per cent over its benchmark, three-month LIBOR.