Pioneer Investments is adding a new sub-fund to its Luxembourg-domiciled Pioneer Funds range which will invest in different types of fixed income securities.
According to Pioneer, different sectors of the bond market have taken turns outperforming one another. For this purpose, the new sub-fund, Strategic Income, will attempt to exploit the performance differential between bond classes by implementing an active, value driven re-balancing of the assets between the bond categories. The fund will be actively managed between US investment grade, international investment grade, US high yield and emerging markets.
This approach differs from traditional bond funds, which tend to focus on individual bond sectors, it adds.
There are hopes that exposure to high yield bonds will push up income, while this additional risk will be countered by a healthy content of investment grade and government debt.
The net anticipated effect is a competitive yield, but with controlled risk and lower volatility than investing in just one class of fixed income security.
The Luxembourg fund replicates Pioneer's US similarly-named Pioneer Strategic Income Fund, and will be managed by the same investment team, led by Ken Taubes.
The US Fund has a four-star Morningstar rating. It was launched in early 1999 and over the three years to 28 February 2003 it is placed two out of 107 funds in Lipper's Multi-Sector Bond Category and is one of the select funds to be awarded Lipper Leader status.
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