fund

Rated

This is one of our rated funds. They’re the ones our experts believe will do well for investors over the longer term. Top of the class!

Janus Henderson Strategic Bond I

A total return fund with the ability to invest across the bond spectrum.

  • 141.30p
    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.

  • 391.80p
    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).

  • 0.69%
    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.

  • 2.70%
    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 25 January 2022, fund commentary last updated 08 October 2021

The fund aims to provide long-term income and capital growth by investing in high yield bonds, investment grade bonds, government bonds and preference shares. It may also invest in equities. Managers John Pattullo and Jenna Barnard seek to outperform the IA Sterling Strategic Bond Sector over any five-year period. They combine a top-down investment approach, looking at areas such as debt and technology, and thematic stock selection favouring bonds from developed market large-cap non-cyclical companies. The fund’s holdings include Canadian government bonds as well as those issued by companies such as streaming giant Netflix.

Fund summary

Sector £ Strategic Bond
Structure OEIC
Launched September, 2000
Size £3,377m
Yield 2.70%
Charging basis Capital
Dividends paid 28 Feb, 31 May, 31 Aug, 30 Nov

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 0.69%

Allocation

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Investment process

The team believes that most bond managers mistakenly focus on the economic “weather” such as the next inflation or non-farm payroll figures. This had led many to make incorrect judgements on short-term interest rates and bond yields. In contrast Pattullo and Barnard focus on the structural drivers of economies such as excessive debt, inequality, demographics, and technology. These, they believe, have anchored bond yields at lower levels than consensus forecasts. When it comes to building the portfolio, the team look at fundamental factors such as a country’s economic cycle and monetary policy conditions. They also focus on asset valuations and momentum indicators. For stock selection they take a “sensible income” approach identifying quality, growth companies in non-cyclical sectors and with a high return on capital. In addition, they seek bond issue sizes of at least £300m and disciplined management teams. The portfolio’s biggest exposure is to investment grade non-financial corporate bonds.

The fund managers take a cautious approach to risk, deeming some areas of the market as inherently un-investible. This may include developing countries and companies in cyclical sectors like mining and energy. They also have an aggressive selling mindset to protect the fund’s value with company profit warnings or management change potentially triggering a review. It is this structural approach to investing rather than out and out stock-picking which has driven its strong performance over recent years. The fund is led by an experienced management team meaning there is good stability around the very clear investment philosophy and process. They also benefit from the support of the wider fixed income team at Janus Henderson across credit, loans, economics, and global government.

Manager research

Average monthly relative returns

  • 17/18 0.16%
  • 18/19 -0.06%
  • 19/20 0.32%
  • 20/21 0.22%
  • 21/22 0.02%

Bestinvest MRI

  • 3 years 0.18%
  • 5 years 0.13%
  • Career 0.01%
  • 3 years 99.10%
  • 5 years 99.70%
  • Career 83.40%

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

John Pattullo / Jenna Barnard

Pattullo graduated in economics from St.Andrews University in 1993. He became a Chartered Accountant with Price Waterhouse Coopers and then joined Henderson as an analyst in 1997. He is now Janus Henderson's head of UK retail fixed income. Pattullo is a member of the Institute of Chartered Accountants of Scotland and an Associate Member of the Society of Investment Professionals. Barnard graduated from Oxford University with a first class BA (Hons) in Politics, Philosophy and Economics. She worked for Orbitex Investments before joining Henderson as a credit analyst in 2002, becoming a credit portfolio manager in 2004. She is a CFA charterholder, and an affiliate member of UKSIP. Barnard is a Member of the Society of Technical Analysts having passed the STA Diploma exam.

Track record

John Pattullo / Jenna Barnard has 15.8 years experience of managing mutual funds in this sector. Over this period the average monthly return relative to the benchmark index has been +0.01%. During the worst period of relative performance (from June 2007 - March 2009) there was a decline of 22% relative to the index. The worst absolute loss has been 26%. Statistically, we estimate the probability that this fund manager is adding value, rather than being lucky, is 83%.

Periods of worst performance

Absolute -26.00% (May 2007 - March 2009)
Relative -22.00% (June 2007 - March 2009)

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 October 2021

3.1% Canadian Government Bond 0.25% 2023
1.9% Hm Treasury United Kingdom Dmo 0.125% Treasury Gt 31/01/23 Gbp0.01
1.8% Australia(Commonwealth Of) 0.25% Tb 21/11/25 Aud100
1.6% Alphabet Inc 1.998% Bds 15/08/26 Usd2000
1.2% Stichting Ak Rabobank Certificaten 19.4365% 2170
1.1% Microsoft Corp 2.4% Bds 08/08/26 Usd2000
1.1% Netflix 3.625% 2030
1% Bupa Finance Plc 4.125% Sub Nts 14/06/35 Gbp100000
.9% Ball Corp 2.875% Bds 15/08/30 Usd2000
.9% Natwest Group 3.622% 2030
Source: Trustnet

Sector breakdown

Investment Grade Corporate Bonds 28.00%
High Yield Bond 23.00%
Investment Grade Corporate Bonds 15.00%
Money Market 14.00%
Government Bonds 10.00%
High Yield Bond 5.00%
Debt 4.00%
Preference Shares 1.00%

Portfolio

Investments may include pan European and US high yield, preference and convertible shares, sovereign and corporate bonds. There is no minimum exposure to any one security class. The fund may carry unhedged currency positions, typical max 5% of NAV.

Constraints

Maximum exposures: Corporate bonds : 80%, High yield : 100%, Emerging debt : 30%, Sovereign debt : 20%

Key Investor Information - Income

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Key Investor Information - Accumulation

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