Schroders has launched a global credit income fund to be managed by Patrick Vogel and Michael Scott as the fund house looks to tap demand for income with bond yields beginning to rise from record lows following the US election.
The asset manager's Global Credit Income fund will invest "actively and flexibly" across markets including investment grade, high yield, emerging market debt and asset-backed securities.
The fund will be unconstrained in an attempt to allow its managers the freedom to express "high conviction where income opportunities are present" and "avoid parts of the market with significant downside risk".
Schroders, which runs around £19.6bn in European and global credit strategies, cited a demand for attractive income and low downside as behind the fund's launch.
John Troiano, global head of distribution, said: “In the current low interest rate environment the search for income has been at the forefront of our clients’ minds but many do not want to take on high levels of risk to achieve this.
"This strategy aims to balance these two considerations, delivering income whilst managing the downside risk.”
The fund, which is denominated in dollars, will have an ongoing charge of 1.1 per cent.
Scott Gallacher, chartered financial planner at Rowley Turton, said: "It’s somewhat of a surprising time to be launching a Global Credit Income fund.
"While I do like broad mandate funds, I am a little concerned about the quoted ongoing charge of 1.1 per cent which seems high to me, although I understand that this is in keeping with what similar existing funds charge."
