Insight Investment has launched the Insight Buy and Maintain Bond fund for Adam Mossakowski, aiming to provide diversified exposure to global corporate bonds.
The investment strategy seeks to limit the downside effect of benchmark tracking strategies by limiting sector, industry and issuer concentration based on a strict set of criteria.
The manager will not invest in some instruments he considers to be unsuitable, such as Tier 1 bank debt, and will only buy bonds he believes to have sound fundamental investment prospects.
The fund will also seek to avoid liquidity constraints by buying credit on a long-term view and avoiding loss from default or deterioration in credit quality, while also continually refreshing the portfolio through coupon flow and secondary turnover.
Mossakowski said: "Insight's Buy and Maintain strategy offers credit exposure without the drawback of being benchmarked to market capitalisation-weighted bond indices.
"Following such indices can result in unintended risks for investors. For example, at the height of the financial crisis the iBoxx Sterling Non-Gilt Index had a 40% allocation to financials.
"Market capitalisation weighted bond indices expose investors to the biggest issuers of debt. These may also be the most leveraged and indebted companies."
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