jupiter to launch offshore strategic bond

Jupiter Asset Management is to launch an offshore mirror of its high performing Strategic Bond Fund for manager Ariel Bezalel.

jupiter to launch offshore strategic bond


The new fund will be part of the company’s Luxembourg-domiciled Jupiter Global Funds Sicav. Euro-denominated it will offer investors the choice of four currencies: the euro, the US dollar, Swiss franc or sterling.

Jupiter said while the fund has already been authorised it cannot yet confirm an exact launch date but hopes to make the fund available in the second quarter of this year.

The UK-domiciled unit trust, which the new fund will mirror, is one of the company’s more popular funds, with assets under management at the end of January of £695m. Launched in June 2008, the top-quartile fund has achieved consistently strong performance through investment in a mixture of high and mid-rated government and company bonds from across the world.

The stated objective of the fund is to “achieve a high income with the prospect of capital growth by seeking out the best opportunities within the fixed interest universe globally”.

As of 22 February, the fund had returned over 50% since launch against an IMA £ Strategic Bond sector average of 21% over the same period. Bezalel’s shorter term performance has also been strong, with one and three year returns of 5.9% and 67%, respectively.

Portfolio allocation

The fund is currently weighted towards the mid-rated bond range, with a total allocation of around 50% towards bonds rated between BBB and B. In geographic terms the fund has its highest weighting towards the UK and Europe, although the portfolio also includes bonds from the Middle East, South Africa and North and South America.

An inherently “value” focused manager, Jupiter says Bezalel “typically looks for situations offering good risk/reward positions” adding that he takes a top down/bottom up approach to investment.

Encouragingly for Jupiter, Defaqto recently published research suggesting advisers should not “overlook the potential benefits of selecting strategic bond funds, despite a difficult 2011”.

Adrian Gaspar, senior consultant at Defaqto, said: “Strategic bond funds have been one of the key investment developments over the last decade, enabling advisers to outsource the difficult decisions on what types of bond to invest in and when.

“Recent market turmoil has highlighted the significant divergence in performance of the various types of bonds but it also suggests that opportunities exist to buy good quality issues at relatively low prices. Outsourcing some, or all, of the responsibility for identifying these opportunities to a manager with significant expertise and resource should save advisers time and also help them deliver outcomes in line with their clients’ expectations.”



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