Hermes launches absolute return credit fund

Hermes launches absolute return credit fund

Hermes Investment Management has expanded its fixed income offering with the launch of a Hermes Absolute Return Credit fund.

Fraser Lundie, co-head of Hermes credit and Raphael Muller, senior portfolio manager, will manage the fund.

The fund, which was launched on May 29 will target an absolute return over a rolling 12 month period. It will sit in the IA Target Absolute Return sector and all investments will be hedged back to US dollars.

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The managers will invest in between 100 and 150 names, with a focus on investment grade bonds at the lower end of the credit spectrum.

Mr Lundie’s £257.7m Multi-Strategy credit fund has slightly underperformed its sector, the IA Sterling Strategic Bond sector, since its inception in May 2014.

It has returned 3.7 per cent, while the sector returned 3.9 per cent, according to data from FE Analytics.