Fixed IncomeJul 4 2016

Axa IM launches short-duration inflation fund

twitter-iconfacebook-iconlinkedin-iconmail-iconprint-icon
Search supported by
Axa IM launches short-duration inflation fund

Axa Investment Managers has launched a short-duration inflation-linked bond fund to be managed by Jonathan Baltora.

The Axa WF Global Inflation Short Duration Bonds fund will aim to hedge the impact of global inflation and interest rates, while maintaining a “diversified and liquid” strategy, the firm said.

It will follow a similar strategy to firm’s flagship €3bn (£2.5bn) Global Inflation Bonds fund, on which Mr Baltora is deputy manager, alongside Marion Le Mordhedec.

Ms Le Mordhedec will provide support on the new strategy.

The new fund will invest in global bonds between zero and five years in duration, with the aim of keeping the total return in line with global inflation levels.

Mr Baltora said: “A key feature of the inflation-linked bonds market is that the inflation paid out to investors is the same for every bond across the curve; investors looking for explicit inflation protection need not be exposed to all maturities.

“Short-duration bonds can also be cheaper than longer-duration inflation-linked bonds. In these uncertain times, investors in short-duration inflation bonds would be giving up less yield thanks to the flattening of the underlying real yield curve, which was particularly noticeable after the recent UK referendum vote.”

The Luxembourg-domciled Sicav’s F share class will have an ongoing charges figure of 0.47 per cent and a minimum investment of €5,000.