Bestinvest says
The Threadneedle team is amongst the top tier of investors in the European high yield debt market by assets under management. This fund provides core exposure to the European high yield debt markets, a market that continues to grow in size and depth, thereby increasing the opportunity set. The team have a strong track record of providing positive relative returns to peer group funds.
The investment process for this fund is the same as for the Threadneedle High Yield Bond Fund managed by Barrie Whitman, and the two funds will usually have a high degree of commonality. The main difference is that all non-euro exposure is hedged into euros.
The essential driver of fund performance is bottom up credit selection, reviewing covenant structure, company valuation, financial and business analysis. Credit analysis is subsequently combined with a top-down sector/industry overlay to finalise the company specific credit opinion. The reference benchmark is Merrill Lynch European High Yield, 3% constrained, hedged into euros.