Fidelity to unveil global high yield fund

Tuesday, 28 February 2012 11:13

Fidelity Worldwide Investment is boosting its fixed income range with a new high yield fund.

The Fidelity Global High Yield Fund will be introduced on March 19, subject to FSA approval, offering investors an unconstrained portfolio of around 150 high conviction ideas mainly in BB and B-rated credits.

Some CCC credits may be included where they offer an attractive risk-reward proposition, the asset manager said.

Peter Khan, co-manager of Fidelity High Yield, said that banks’ limited appetite to roll over loans is likely to continue, encouraging more companies to seek funding in the bond market.

The move away from loans into high yield bonds has been a major trend in the last three years and is set to continue, especially throughout Europe, he added.

“Low interest rates should also continue to increase the investor base for higher yielding assets, which will help to absorb the new supply,” Mr Khan said.

“And, assuming the economy avoids recession, it should foster strong demand for higher yielding products and good, but volatile, new-issuance conditions.”

The minimum investment is £1,000 for the A share class and £500,000 for the Y share class.


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