The fund aims to provide investors with a return of 2% in excess cash over a rolling 3 years and a positive return over any rolling 12 month period. The fund is expected to deliver more consistent returns than an income fund and reduce the volatility inherent in the bond market. Great care is applied to protect the fund against incurring losses.
Investement process. The fund is actively managed by an experienced team who are able to change the fund's duration depending on our view of the interest rate cycle and the valuation of fixed rate bonds.
Derivatives are deployed to switch between fixed and floating rate exposure, which also mitigates the risk of volatility associated within the bond market.
There are no guarantees that the fund will always outperform cash over short periods of time and therefore capital losses are possible, especially in the case of negative credit events which may affect the underlying holdings. The fund's investments are subject to a stringent risk management process