SchrodersFeb 21 2022

Schroders repurposes three underperforming funds

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Schroders repurposes three underperforming funds

Schroders has repurposed three funds into new strategies after a period of underperformance.

The European Alpha Income Fund is now the Schroder European Sustainable Equity Fund, the Global Cities Income Fund is now the Schroder Digital Infrastructure Fund, and the Absolute Return Bond Fund is now the Schroder Sustainable Bond Fund.

The former Global Cities Income Fund posted a -1.68 per cent cumulative return over three years compared with the IA infrastructure sector which saw a 19.92 per cent return over the same period.

The former European Sustainable Equity Fund also underperformed its sector over the past three years, posting a -2.13 per cent cumulative performance compared with the IA’s Europe excluding UK benchmark returning 33.13 per cent.

Finally, the former Absolute Return Bond Fund saw a cumulative performance of 1.62 per cent over the past three years, compared with the IA’s targeted absolute return sector posting a 91 per cent return.

Doug Abbott, head of UK intermediary, Schroders, said he expects sustainable and impact investing to become a cornerstone of many UK investors’ portfolios.

“In response to this rising demand, Schroders' ambition is to be a leading provider of sustainable funds, solutions and investment trusts to UK investors," he said.

The Schroder Digital Infrastructure Fund is part of the Schroders Global Transformation Range and aims to deliver long-term capital growth by investing in companies that have a sustainable philosophy

Tom Walker and Hugo Machin, co-fund managers of the Schroder Digital Infrastructure Fund, said digital infrastructure has a key role to play in promoting economic competitiveness, social inclusion and reducing energy consumption. 

“We believe that digital assets are mission critical and in our view, provides a compelling growth opportunity for companies that are at the forefront of this transformation, but where their potential is yet to be reflected in share prices.”

Schroder Unit Trust Limited European Sustainable Equity will give investors exposure to “harness long-term outperformance driven by ESG factors”.

The fund was launched as a Luxembourg-domiciled strategy in 2019.

The Schroder Sustainable Bond Fund will invest in sovereign and corporate debt across developed and emerging markets and will focus on countries that have in place policies which are supportive of sustainable growth and net-zero ambitions.