Our Six Nations investment squad
One of the unforeseen consequences of marrying a Fijian has been that I’ve had to learn to a)...
Royal London Corporate Bond
This fund offers access to a portfolio of predominantly, but not exclusively, investment grade corporate bonds. The manager has proved adept at delving into parts of the fixed income market where others fear to tread and identifying bonds that offer superior risk-adjusted returns. The process is risk aware and concentrates on avoiding losers rather than picking big winners with the goal of providing an attractive and stable yield over time.
Our opinion
What sets this fund apart from many of its peers is the manager's ability to identify less well-known stocks with superior risk-adjusted returns. The fund has an attractive yield, and the strength and stability of the team give us confidence.
Company description
Royal London Asset Management, established in 1988, is a wholly owned and central part of the Royal London Group. It manages investments, pension funds and other assets on behalf of clients. Delivering sustainable sources of income is a particular focus, and managers scrutinise a wider universe than many of their competitors to find opportunities in areas that are often overlooked.
Fund manager
Jonathan has been applying his long-term, macroeconomic approach since joining Royal London Group in 1985. In 1992, he became head of fixed interest. He is known for swimming against the tide and investing in high yield bonds that lack a credit rating.
I work closely with other managers and analysts to share research and investment ideas, allowing us the resources to explore often overlooked opportunities.
Jonathan PlattFund manager
Investment process
Jonathan believes that over-reliance on ratings agencies and inadequate benchmark construction methods leads to inefficiencies that a stock-picking manager can exploit. He pays particular attention to the asset-backed sector and unrated bonds. In addition to credit quality analysis carried out by most bond fund managers, Jonathan goes into painstaking detail, analysing covenant documents to estimate not only chance of default, but the expected recovery rate too. The portfolio is well diversified and typically holds more than 200 names.
Risk
While Jonathan looks at some of the less researched areas of the market, his detailed analysis, as well as the large number of names in the portfolio, goes a long way to reducing single company credit and liquidity risk. The fund in fact has a lower risk profile than many of its sector peers.
Related content
Greek bonds: a ‘feta’ investment or tragedy waiting to happen?
August 2018 marks the end of an era for Greece: After years of austerity, its emergency loan...
The Elite Rated funds that have (almost) never lost you money
Whenever we look at fund performance, it’s all too easy to become drawn to the portfolios...
The information, data, analyses, and opinions contained herein (1) include the proprietary information of FundCalibre, (2) may not be copied or redistributed without prior permission, (3) do not constitute investment advice offered by FundCalibre, (4) are provided solely for informational purposes and therefore are not an offer to buy or sell a fund, and (5) are not warranted to be correct, complete, or accurate. FundCalibre shall not be responsible for any trading decisions, damages, or other losses resulting from, or related to, this information, data, analyses, or opinions or their use. The Elite Fund rating is subjective in nature and reflects FundCalibre’s current expectations of future events/behaviour as they relate to a particular fund. Because such events/behaviour may turn out to be different than expected, FundCalibre does not guarantee that a fund will perform in line with its FundCalibre benchmark. Likewise, the Elite Fund rating should not be seen as any sort of guarantee or assessment of the creditworthiness of a fund nor of its underlying securities and should not be used as the sole basis for making any investment decision. FundCalibre disclaims any responsibility for trading decisions, damages or other losses resulting from any use of the Elite Fund rating. All performance data, as well as fund size, OCF, AMC, annual income (historic), share price discount or premium, is sourced directly from FE Analytics, and will change periodically.