Bestinvest says
Short duration high yield bond funds provide a much less volatile means of playing the high yield bond markets. As a result of the shorter maturity of underlying securities the fund is generally less sensitive to any rise in yield curves and changes in the markets perception of default risk relative to more core high yield bond funds consequently capital appreciation or loss tend to be more limited.
The investment team's process focuses on bottom up fundamental credit analysis with an emphasis on a company's financial credit worthiness and covenant terms. The fund only invests in cash bonds, no derivatives are used in the portfolio management process. Whilst the fund invests mainly in BB and B rated bonds, CCC debt can be held. The underlying securities consist of nominal and floating rate corporate bonds, whilst these will usually be US denominated bonds, Euro and GBP denominated bonds may also be held. The average maturity of the underlying bonds is typically 3 yrs.