M&G (Lux) Global High Yield Bond Fund

ISIN
LU1670726402

Price (29.05.2020)
14.04

% Price Change
0.39

Objective and investment policy

Objective

The fund aims to provide a combination of capital growth and income to deliver a return that is higher than that of the global high yield bond market over any five-year period.

Investment policy and strategy

Core investment: At least 80% of the fund is invested in high yield bonds issued by companies from anywhere in the world, including emerging markets. These bonds can be denominated in any currency. The fund aims to hedge any non-US dollar assets back to US dollar.

Other investments: The fund may invest in bonds issued by governments, high quality corporate bonds, asset-backed securities and cash or assets that can be turned quickly into cash.

Derivatives: The fund may invest via derivatives and use derivatives to reduce the risks and costs of managing the fund.

Strategy in brief: The fund is a flexible global high yield bond fund. The investment manager selects investments based on in-depth analysis of individual bond issues, combined with an assessment of macroeconomic factors such as economic growth, interest rates and inflation.

The investment manager is assisted in the selection of individual bonds by an in-house team of analysts.

Benchmark: BofA Merrill Lynch Global High Yield Index USD Hedged

The benchmark is a comparator against which the fund’s performance can be measured. The index has been chosen as the fund’s benchmark as it best reflects the scope of the fund’s investment policy. The benchmark is used solely to measure the fund’s performance and does not constrain the fund's portfolio construction.

The fund is actively managed. The investment manager has complete freedom in choosing which investments to buy, hold and sell in the fund. The fund’s holdings may deviate significantly from the benchmark’s constituents.

For unhedged and currency hedged share classes, the benchmark is shown in the share class currency.

You can find more information about the objective and investment policy of the fund in the Prospectus.

Risks associated with the fund

The value and income from the fund's assets will go down as well as up. This will cause the value of your investment to fall as well as rise. There is no guarantee that the fund will achieve its objective and you may get back less than you originally invested.

Investments in bonds are affected by interest rates, inflation and credit ratings. It is possible that bond issuers will not pay interest or return the capital. All of these events can reduce the value of bonds held by the fund.

High yield bonds usually carry greater risk that the bond issuers may not be able to pay interest or return the capital.

The fund is exposed to different currencies. Derivatives are used to minimise, but may not always eliminate, the impact of movements in currency exchange rates.

The fund may use derivatives to profit from an expected rise or fall in the value of an asset. Should the asset's value vary in an unexpected way, the fund may lose as much as or more than the amount invested.

The hedging process seeks to minimise, but cannot eliminate, the effect of movements in exchange rates on the performance of the hedged share class. Hedging also limits the ability to gain from favourable movements in exchange rates.

In exceptional circumstances where assets cannot be fairly valued, or have to be sold at a large discount to raise cash, we may temporarily suspend the fund in the best interest of all investors.

The fund could lose money if a counterparty with which it does business becomes unwilling or unable to repay money owed to the fund.

Further details of the risks that apply to the fund can be found in the fund's Prospectus.

Other information

The fund may invest more than 35% in securities issued by any one or more of the governments listed in the fund prospectus. Such exposure may be combined with the use of derivatives in pursuit of the fund objective. It is currently envisaged that the fund’s exposure to such securities may exceed 35% in the governments of Australia, Austria, Belgium, Canada, Denmark, Finland, France, Germany, Italy, Japan, Netherlands, Singapore, Sweden, Switzerland, UK, USA although these may vary subject only to those listed in the prospectus. This fund allows for the extensive use of derivatives.


The performance webpage for this fund is currently being reconfigured. In the interim, for performance information, please refer to the latest Fund Factsheet which can be found in the Literature section.

Fund Team

Stefan Isaacs

Stefan Isaacs - Fund manager

Stefan Isaacs is deputy head of M&G's Wholesale Fixed Income team and is fund manager of the M&G (Lux) European Corporate Bond Fund. He is also co-fund manager of the M&G (Lux) Global High Yield Bond Fund, M&G (Lux) Floating Rate High Yield Solution, M&G (Lux) Global High Yield ESG Bond Fund and M&G (Lux) Global High Yield Bond 2023 Fund, and deputy fund manager of the M&G (Lux) Optimal Income Fund. Stefan initially joined M&G as a graduate in 2001 and was subsequently promoted to corporate bond dealer specialising in high yield bonds and euro-denominated credit, becoming part of the fund management team in 2006.

 Team member biography
James Tomlins

James Tomlins - Co-manager

James Tomlins is fund manager of the M&G (Lux) Global Floating Rate High Yield Fund and co-manager of the M&G (Lux) Global High Yield Bond Fund, M&G (Lux) Floating Rate High Yield Solution, M&G (Lux) Global High Yield ESG Bond Fund and M&G (Lux) Global High Yield Bond 2023 Fund since launch. James is a specialist in high yield credit with more than 10 years’ experience in this sector. He was previously an analyst and then a fund manager at Cazenove Capital Management. Before Cazenove, James was at KBC Alternative Investment Management; in the three years prior to that, he worked at Merrill Lynch Investment Managers. James is a CFA charterholder and graduated with an MA in history and PgDip in economics from the University of Cambridge.

 Team member biography
Mario Eisenegger

Mario Eisenegger - Investment specialist

Mario Eisenegger joined M&G in February 2015 as an associate investment specialist providing support for the retail fixed interest fund range. He was previously at UBS, where he was a senior client advisor to private clients and a deputy branch manager. Mario holds a bachelor of science from the University of Northwestern Switzerland. Mario speaks German and Swiss German.

 Team member biography

Ratings

Rating is at a share class level

3 Star Rating

Ratings as at 28/02/2020. The Morningstar Overall Rating. Copyright © 2019 Morningstar UK Limited. All Rights Reserved. The Morningstar Analyst Rating™. © 2019 Morningstar. All Rights Reserved. Neither Morningstar nor its content providers are responsible for any damages or losses arising from any use of this information. Ratings should not be taken as recommendation.

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