The launch comes as policymakers are encouraging pension schemes to play a greater role in supporting UK economic growth and as Local Government Pension Schemes (LGPS) seek opportunities to invest closer to the communities they serve. Fidelity's London Bond Strategy provides a liquid, investment-grade credit solution that enables London borough pension funds to invest in organisations that contribute to London's economy while maintaining a disciplined approach to risk and return objectives, the firm said in a statement.

At least 80 per cent of the portfolio will be invested in investment-grade issuers that play a vital role in London's economy and infrastructure, creating a diversified credit portfolio. The investment universe includes two categories of issuers: Core London Assets, organisations that support London's essential physical and social infrastructure, and London Economic Anchors, major employers and businesses that make a significant contribution to the capital's economic activity.

The strategy is managed by Ian Fishwick, alongside co-portfolio managers Kris Atkinson and Shamil Gohil, within Fidelity International's sterling credit platform. It draws on the expertise of Fidelity's global fixed income team, which manages around $100 billion across investment-grade credit, high yield, sovereign debt, emerging market debt and multi-sector fixed income strategies.

"Local Government Pension Schemes are increasingly looking for investment solutions that deliver attractive risk-adjusted returns while investing in the communities they serve,” Tom Jeffery, head of EMEA Institutional, Fidelity International, said. “The London Bond Strategy has been designed to meet that demand through a diversified investment-grade credit portfolio focused on organisations that support London's economy.”