Aviva Investors Corporate Bond SC 2

Invests exclusively in UK investment grade corporate bonds.

  • 97.30p
    Price (Inc)

    These are the shares in the fund that pay out an income to clients. The income is made up of the total dividends – the money a company can pay out to its investors – from the companies in the fund.

  • -
    Price (Acc)

    These are the shares in the fund that don’t pay out an income to clients. Any dividends – the money a company can pay out to its investors – are reinvested into companies in the fund. Despite no income, the shares should be worth more over time. Good incentive, eh?

  • 0.00%

    Initial charge

    Some funds charge you when you first invest, which is aptly known as the initial charge. They’re usually between 3-5% but at Bestinvest, we usually don’t charge you a penny!

  • 0.60%
    Annual management charge

    This is how much the fund management company charges to run the fund. It’s like paying a babysitter, dog sitter or house sitter (that makes well-informed, heavily researched changes to improve your baby/dog/house when needed).

  • 0.62%
    Ongoing charges

    This stands for Ongoing Charges Figure. It’s the cost of running a fund and includes admin fees, manager fees, administration costs, etc.

  • 1.80%
    Yield

    How much the fund is currently paying out in income to investors. It’s NOT to be confused with the overall growth of a fund – a very different thing indeed. It’s also NOT a guarantee of future pay-outs, just a snapshot. This is more what it’s not than what it is…

Prices as at 23 November 2020, fund data last updated 06 July 2006

A total return fund which seeks to provide investors with a consistent level of income whilst aiming to preserve capital through investing mainly in sterling denominated investment grade bonds. The fund will not hold preference or convertible stock.

Fund summary

Sector £ Corporate Bond
Structure OEIC
Launched November, 1998
Size £2,948m
Yield 1.80%
Charging basis Income
Dividends paid 15 Mar, 15 Jun, 15 Sep, 15 Dec

Charges

Standard initial charge 0.00%
Initial charge via Bestinvest 0.00%
Additional bid/offer spread 0.00%
Annual management charge 0.60%
Ongoing charges figure 0.62%

Allocation

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Investment process

Responsibility for the running of the portfolio is with Morley Fund Management, the investment management arm of Aviva, (formerly CGNU). The fund will be invested mostly across UK corporate bonds and gilts. The process is a blend of top down and bottom up strategies. The team will start with an analysis of the macro economic environment to determine the risk profile of the fund, they will subsequently select individual issues that reflect these views. The manager expects out performance to be driven mostly by stock selection, duration management carries a low emphasis, sector allocation is invariably a by product of the investment process. The fund's reference benchmark is the IA UK Corporate Bond.

Manager research

Average monthly relative returns

  • 15/16 -0.29%
  • 16/17 -0.04%
  • 17/18 0.01%
  • 18/19 -0.17%
  • 19/20 -0.07%

Bestinvest MRI

  • 3 years -0.08%
  • 5 years -0.11%
  • Career -0.12%
  • 3 years 39.40%
  • 5 years 17.40%
  • Career 9.30%

Performance figures are based on the average of monthly percentage returns relative to the benchmark index.

Christopher Higham

Higham rejoined Morley in September 2008 from Old Mutual Asset Managers where he worked as a fund manager since June 2005. He co-managed the AA rated Old Mutual Dynamic Bond fund and deputy managed the Old Mutual Corporate Bond fund. He previously worked at Morley from September 1999 as a credit analyst.

Track record

Christopher Higham has 12.7 years experience of managing mutual funds in this sector. Over this period the average monthly return relative to the benchmark index has been -0.12%. During the worst period of relative performance (from May 2008 - August 2020) there was a decline of 17% relative to the index. The worst absolute loss has been 23%.

Periods of worst performance

Absolute -23.00% (April 2008 - March 2009)
Relative -17.00% (May 2008 - August 2020)

About the MRI

Our unique indicator: the Bestinvest Manager Record Index (MRI) measures the likelihood that the fund manager is adding value through their decisions. It is based on their performance record over the course of their career, adjusted for the amount of risk taken. MRI is an important contributor to our fund rating system but it is also vital to take account of qualitative factors. It is also very important to select funds to form a cohesive portfolio with an appropriate overall risk level.

Allocation

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Top 10 holdings

Data accurate as at 31 July 2020

2.54% European Investment Bank 1% Mtn 21/09/26 Gbp1000
1.86% United Kingdom Of Great Britain And Northern Ireland 4.5% 07/12/2042
1.64% Kreditanstalt Fur Wiederaufbau 1.38% 09/12/2024
1.51% Barclays Bank Plc 10% 21/05/2021
1.42% Hm Treasury United Kingdom Dmo 4.25% Gilt 07/03/36 Gbp0.01
1.39% Electricite De France Sa 6.12% 02/06/2034
1.38% Western Power Distribution West Mid 5.75% Snr Unsec Nts 16/04/32 Gbp100000
1.34% Banco Santander Sa 1.375% Bds 31/07/24 Gbp100000
1.29% E.on International Finance 6.375% Mtn 07/06/32 Gbp1000
1.28% Telefonica Emisiones Sau 5.445% Inst 08/10/29 Gbp50000
Source: Trustnet

Sector breakdown

Others 24.00%
Banks 20.00%
Communications 10.00%
Government Agency Bonds 10.00%
Electricity Supply 7.00%
Government Bonds 7.00%
Non-Cyclical Consumer Goods 7.00%
Fixed Interest 6.00%
Transport 5.00%
Financials 4.00%

Portfolio

The guidelines for the fund state that the average weighted credit rating should be at least A. The portfolio will be diversified across at least 100 issues, normally between 110-130 stocks. No more than 10% of the value of the assets in the fund to be invested in securities issued by any single issuer or on 'unapproved markets'. Up to 35% to be invested in gilts and up to 5% in collective investment schemes.

Constraints

Maximum weight per issuer: 5%, in practice the range tends to be 1-3.5%.

Key Investor Information

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