Jupiter launches emerging markets bond fund

Jupiter launches emerging markets bond fund

 Jupiter has launched a short-duration emerging market bond fund.

The fund, managed by Alejandro Arevalo, will concentrate on short duration bonds exposed directly or indirectly to emerging market economies worldwide.  

It follows the launch of the Jupiter Global Emerging Markets Corporate Bond fund in March this year.

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The fund will adopt a total return approach, with the flexibility to allocate between sovereigns, corporates and local currency, while keeping average fund duration under three years.

Mr Arevalo said the fund allowed investors to benefit from the improving fundamentals in emerging markets while targeting total return with limited interest rate risk.

He said: ”Emerging market economies continue to benefit from record lows in inflation, increased world trade volumes and strong drivers of domestic growth.”

Katharine Dryer, head of investments for fixed income and multi-asset at Jupiter, said: “This new fund will further enhance Jupiter’s range of fixed income strategies, enabling new and existing clients to access this important asset class through products designed to suit different market environments and investor objectives.”  

Shorter duration bond funds have been popular in recent months, with EdenTree, the ethical provider launching a short-dated fund earlier this month, and Axa launching a global short-dated bond fund in May.

These funds are seen as carrying less interest rate risk than longer term bond funds, which makes them a popular vehicle for more cautious investors.

Financial adviser Sebastian Hurst, from Plutus Wealth Management, said he only used bond funds, no matter their duration, for very cautious clients because of the lack of returns at present.