Aberdeen Asset Management has joined the rush of fund houses launching short-duration products as investors seek a more conservative way of accessing fixed income.
The fund house has joined the likes of Axa Investment Managers and Canada Life Investments looking to capitalise on demand for lower-volatility, above cash returns. Investors have begun looking for lower-volatility bond exposure particularly after a summer than saw yields across the curve fall to record lows. This, alongside concerns over divergent rate directions and illiquidity at the longer-end of the curve, has seen a spike in demand for short-duration products.
The Aberdeen Sterling Short Dated Corporate Bond fund will be managed by the asset manager's pan-European fixed income team who currently run the £1.7bn Corporate Bond vehicle.
It will have a minimum investment of £500 and an ongoing charges figure of 0.69 per cent.
The portfolio will focus on investment grade credit maturing within five years, while the team can allocate up to half of the vehicle's exposure to non-sterling assets that are then fully hedged back.
Roger Webb, head of pan-European credit at the firm, said: "This fund offers the opportunity to limit exposure to rising yields in fixed income securities whilst still remaining exposed to short dated corporate bonds to provide a reasonable level of income in the current environment."
