Bestinvest says
This fund is managed by the highly experienced Barrie Whitman, who has a creditable track record. However, in 2007 we made the decision to remove the fund from our recommended list, reducing our rating to a hold (two stars). Whilst returns relative to the peer group have been respectable, the fund's sector is very competitive and we believe there are higher conviction alternatives.
The fund invests primarily in UK and European fixed interest securities, split between investment grade (higher quality) as well as high yield (lower quality) bonds. The portfolio primarily consists of corporate bonds, but securities issued by governments and supranational borrowers may also be included. Non-sterling bonds are hedged back to sterling.
The named manager is responsible for the high yield portion, whilst the quality bonds are selected by Threadneedle’s Investment Grade team. The mix between the two is agreed at monthly asset allocation meetings and will vary according to prevailing economic and market conditions; the neutral split is 60% investment grade and 40% high yield.
Performance is derived primarily from asset allocation, managing credit specific risk and duration/yield curve positions (i.e. strategic and tactical bets). However, the majority of research time is focused on bottom up analysis (credit specific risk) and stock selection. To aid the fund can draw on Threadneedle's large team of credit specialists.