Two powerful elements, one global fund

Key points

• Global diversified credit portfolio – takes advantage of inefficiencies in ESG and wider credit analysis.
• A highly diversified investment universe – by geography, currency, sector and issuer. Our sustainable analysis and screening reduce the eligible universe by over 50%. 
• Brings together a long successful track record of investing sustainably – with a global credit capability.
• Collaboration – across our experienced investment teams.
• Independent External Advisory Committee – complements our sustainable expertise.
• Established and proven process – our sustainable process has evolved over 15 years making us one of the longest established sustainable asset managers.

Launched at a time of growing investor interest in global credit markets, the fund will be an addition to the highly successful, award winning range of sustainable funds. We manage over £12 billion of assets across equity, fixed income and multi-asset funds within our sustainable range (as at 31 March 2022). 

Why Royal London Asset Management for global credit?

• We have invested significantly in our global credit team since its inception in 2012. Today the team is well resourced with 20 credit analysts and fund managers. 
• Low carbon portfolio – actively avoiding carbon intensive industries while investing in companies at the forefront of the low carbon transition.
• Fund Manager Rachid Semaoune is highly experienced, successfully managing another global sustainable credit strategy.

Investment focus

The fund’s investment objective is to outperform the Bloomberg Barclays Global Aggregate Corporate Total Return Index Hedged USD (the “Benchmark”) by 0.75% per annum over rolling three-year periods (gross of fees).

The fund is suitable for both retail and institutional investors who are seeking a total return over the medium term. This typically means a minimum time horizon of three to five years, but this could vary depending upon individual risk profiles.

The fund will invest in bonds from companies that are deemed to make a positive contribution to society. Investments will adhere to Royal London Asset Management’s sustainable investment policy.

Fund facts

Launch date	10 February 2021
Fund size	£124.3m
Sector	IA Global Corporate Bond
Base currency	USD
Minimum investment	Class M (GBP Hedged) £100,000 Class Z (GBP Hedged) £3,000,000
Fund management fee	Class M (GBP Hedged) 0.53% Class Z (GBP Hedged) 0.40%
Source: RLAM as at 31 March 2022

An expert team

The fund is managed by Rachid Semaoune, a member of Royal London Asset Management's fixed income team. The management team has a collegiate approach, drawing in experience from the Responsible Investing, Global credit and Sterling Credit teams. This team also works closely with Mike Fox, Head of Sustainable Investments, and Shalin Shah, the lead manager of our sustainable sterling credit strategies.

Investment Risks

The value of investments and any income from them may go down as well as up and is not guaranteed. Investors may not get back the amount invested.

Counterparty Risk: The insolvency of any institutions providing services such as safekeeping of assets or acting as counterparty to derivatives or other instruments, may expose the Fund to financial loss.

Credit risk: Should the issuer of a fixed income security become unable to make income or capital payments, or their rating is downgraded, the value of that investment will fall. Fixed income securities that have a lower credit rating can pay a higher level of income and have an increased risk of default.

Derivative Risk: Derivatives are highly sensitive to changes in the value of the underlying asset which can increase both Fund losses and gains. The impact to the Fund can be greater where they are used in an extensive or complex manner, where the Fund could lose significantly more than the amount invested in derivatives.

Efficient Portfolio Management (EPM) Techniques: The Fund may engage in EPM techniques including holdings of derivative instruments. Whilst intended to reduce risk, the use of these instruments may expose the Fund to increased price volatility.

Exchange Rate Risk: Changes in currency exchange rates may affect the value of this investment.

Interest Rate Risk: Fixed interest securities are particularly affected by trends in interest rates and inflation. If interest rates go up, the value of capital may fall, and vice versa. Inflation will also decrease the real value of capital.

Leveraged Risk: The Fund employs leverage with the aim of increasing the Fund’s returns or yield, however it also increases costs and its risk to capital. In adverse market conditions the Fund’s losses can be magnified significantly.

Liquidity Risk: In difficult market conditions the value of certain fund investments may be difficult to value and harder to sell, or sell at a fair price, resulting in unpredictable falls in the value of your holding.