Bestinvest says
This fund sets itself apart from the peer group by the inclusion of unrated bonds (bonds which are not rated by credit rating agencies), which the managers have identified as a valuable source of alpha. This structure is designed to reduce the volatility of returns and improve the risk/return characteristics of the fund. The fund is well diversified and has a competitive charging structure.
Benchmarked against the Barclays Capital Non Gilt Maturities Index, this fund falls into the IMA UK Corporate Bond sector and has the objective of maximising income. The fund may hold up to 10% in gilts, otherwise it is largely invested in sterling denominated corporate bonds. The fund's headline duration will tend to be close to the reference benchmark of about 7 years, although its effective duration maybe less than this. Within the corporate bond market, the emphasis will be towards the lower end of the credit spectrum. Credit research is undertaken on a sector basis. The managers have identified the unrated and structured debt markets as a valuable source of alpha, which has led the fund to traditionally overweight the property, leisure, and investment trust sectors. In addition, these sectors invariably offer asset security for bondholders.