The lead manager on the JB Emerging Markets Investment Grade Bond Fund will be Enzo Puntillo, head of fixed income emerging markets, and the fund will be benchmarked against the JP Morgan Emerging Markets Bond Index Global Diversified Investment Grade.
Explaining the reasoning behind the launch, Swiss & Global said the emerging market investment grade universe had grown “substantially", as credit ratings continue to improve as a result of strong financial fundamentals.
The company added that currently, up to 60% of the traditional emerging market bond universe, as per the fund’s benchmark index, has an investment grade rating.
The Luxembourg-domiciled fund will target investment grade bonds with a credit rating of BBB or higher, and currently has an overweight position towards Central & Eastern Europe, while being underweight Latin America, Asia and Africa.
Fixed income diversifier
Following an active investment approach, Puntillo will use fundamental and valuation analysis to determine country selection and portfolio positioning, taking an overweight or underweight position based on assessment of countries’ fundamental framework and market valuations.
“This product is a diversifier from ‘traditional bonds’,” said Puntillo. “It is a particularly useful allocation tool for investors looking for exposure to countries with strong fundamentals and low debt levels, but who want to maintain their exposure to bonds with high quality ratings.
"Swiss & Global is a pioneer in emerging market investments and with the launch of this fund we now offer investors a complete suite of emerging market debt options.”
He added that, with investors struggling to find yield, exposure to emerging market debt is “essential”, and highlighted the current yield of 3.4% available from some emerging market investment grade.
The Julius Baer Multibond – Emerging Markets Investment Grade Bond Fund, which is Ucits IV structured, has its based currency in US dollar, and is available to investors in dollar, euro and Swiss franc share classes. It has an annual management fee of 0.9%
