Muzinich Short Duration High Yield Hedged GBP A

A short duration high yield bond portfolio.

  • 7514.00p
    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.

  • 10604.00p
    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!

  • 0.80%
    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).

  • 0.86%
    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.

  • 4.60%
    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 May 2020, fund data last updated 13 April 2012

The fund objective is to maximise total returns by investing in a portfolio of short dated (less than 3 yrs to maturity), predominantly US denominated, high yield fixed income bonds hedge to £. Asset class returns are mainly in the form of income. The asset class has a history of providing stable returns characterised by low volatility and low drawdowns. The portfolio is fully hedged to its base currency. Muzinich is a privately owned, US based, fund management house, specialising in the corporate bond market.

Fund summary

Sector
Structure OFFSHORE FUND
Launched October, 2010
Size £1,382m
Yield 4.60%
Charging basis Income
Dividends paid Dec, Jun

Charges

Standard initial charge 0.00%
Initial charge via Bestinvest 0.00%
Additional bid/offer spread 0.00%
Annual management charge 0.80%
Ongoing charges figure 0.86%

Allocation

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Investment process

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 years.

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 market's perception of default risk relative to more core high yield bond funds, consequently capital appreciation or loss tend to be more limited.

Manager research

Average monthly relative returns

  • 15/16 0.00%
  • 16/17 0.00%
  • 17/18 0.00%
  • 18/19 0.00%
  • 19/20 0.00%

Bestinvest MRI

  • 3 years 0.00%
  • 5 years 0.00%
  • Career 0.20%
  • 3 years 0.00%
  • 5 years 0.00%
  • Career 0.00%

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

David Bowen

Portfolio manager and member of the investment committee. Prior to joining Muzinich in 2000, David worked at OFFIT Bank for nine years, the last three years as a high yield analyst. B.A. in Economics from Yale University and M.B.A. in Finance from the Wharton School of the University of Pennsylvania. CFA designation.

Track record

The track record of David Bowen in managing mutual funds in this sector is still too short for us to draw any meaningful conclusions and so our assessment is based largely on qualitative aspects.

Periods of worst performance

Absolute 0.00% (May 2011 - June 2011)
Relative -2.00% (February 2011 - June 2011)

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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Portfolio

Approx 125 issuers/issues.

Constraints

Max portfolio duration 2 yrs. Min average credit quality B. Max single issuer exposure: 3%.

Key Investor Information - Income

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Key Investor Information - Accumulation

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