The Federated Hermes Global Short Duration Bond Fund aims to provide investors with the ability to take a step further along the yield curve from liquidity products, while maintaining a lower exposure to interest rate and credit risk than intermediate and long-duration fixed income offerings. It is part of a wider range of short duration products that bridge the gap between Federated Hermes $637 billion global liquidity platform and the $100 billion fixed income platform.

The macro environment means that interest rates are likely to remain elevated and the pace of future monetary policy easing is likely to be gradual. This, coupled with the possibility of further geopolitical risks and idiosyncratic events, has resulted in increased investor demand for opportunities to access short-dated investments across multiple sectors globally, the firm said.

The fund is co-managed by Ihab Salib, head of international fixed income, and Nicholas Tripodes, head of low duration and structured products group. Yulia di Mambro will be responsible for emerging market research; John Polinski for European corporates research, and Andrew Lennox for European ABS research.

“Our global strategy enhances diversification by spreading investments across various markets and currencies. This approach not only taps into various sources of alpha from across our fixed income platform but is also capable of generating better risk adjusted total returns,” Salib said. “The fund also benefits from the higher liquidity typically associated with short duration bonds, allowing investors easier access to their capital.”