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TWENTYFOUR SUSTAINABLE SHORT TERM BOND INCOME AQG

Bestinvest LogoAn ESG-focused bond fund targeting low volatility returns.

PRICE (INC)

9329p

PRICE (ACC)

10242p

INITIAL CHARGE

5%

0%

ANNUAL MANAGEMENT CHARGE

0.25%

ONGOING CHARGE

0.36%

YIELD

3.6%

1 YEAR
5.59%
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Prices as at 29 Nov 2023.

Fund commentary last updated 22 Sep 2023.

Past performance is not an indication of future performance.

Capital at risk.

The Sub-Fund is an actively managed sub-fund which aims to achieve a positive total return over a 3-year period whilst maintaining an annualized volatility of no more than 3%. While respecting the principle of risk diversification, the Sub-Fund's assets are mainly exposed to the fixed-income asset class by investing in bonds and similar fixed-interest and floating-rate securities issued by corporate issuers rated investment grade (i.e. at least BBB- (S&P and Fitch), Baa3 (Moody's) or with a comparable rating from another recognized rating agency with an expected remaining maturity of less than 5 years. The average time to maturity shall not exceed 3.5 years.

Fund summary

SectorTargeted Absolute Return
StructureOFFSHORE FUND
LaunchedJanuary 2020
Size£1,096m
Yield3.6%
Dividends paidMarch, June, September, December

Charges

Standard Initial Charge5%
Initial Charge Via BestInvest0%
Additional Bid/Offer Spread0%
Annual Management Charge0.25%
Ongoing Charges Figure0.36%

Investment Process

TwentyFour believes that investing in shorter-dated and higher-quality bonds should reduce the volatility associated with spread and interest rate risk. This will increase the probability of a positive return for investors. Manager Chris Bowie also believes that ESG factors impact the future performance of credit assets. TwentyFour expects significant capital will continue to flow into sustainable businesses, thus generating positive returns for bond investors. The investment process for this fund is very similar to the TwentyFour Absolute Return Credit (ARC) fund, but with additional ESG screens. The funds are built using a core portfolio of 0–5-year investment grade credits, which are selected from TwentyFour’s Observatory database on a bottom-up basis. This core portfolio accounts for at least 2/3rds of the fund, with the manager having the flexibility to invest tactically for the final 1/3rd in credit or government debt high yield (BB- minimum credit rating) or ABS (max 20%). The weightings are determined by top-down asset allocation, which is actively managed by the team. The negative screens are straightforward, excluding Tobacco, Alcohol, Gambling, Adult Entertainment, Controversial Weapons, Carbon Intensive Industries, or Animal Testing for cosmetic purposes. If an individual company is showing positive ESG momentum it may be included in the portfolio. Nuclear energy is not automatically excluded as TwentyFour sees it as having a key role in the transition to net zero. The positive ESG scoring model uses Asset4 ESG data and team overlays to give each individual issuer in their Observatory an ESG score. There is also analysis of how issuers rank amongst their sector peers. All company meetings and engagement about ESG are recorded within their database. ESG factors will impact an overall bond’s ESG score, meaning if it scores below a score of 34 it cannot be held in the portfolio.

The information on this website is not intended to be advice or a recommendation to buy, sell or hold any investment mentioned. The value of investments and the income from them can go down as well as up and you may not get back the amount invested.

Past performance is not a guide to future performance. View full risk warning