The Share Centre’s six funds to diversify your portfolio
Pyrford Global Total Return, Fundsmith Equity and LF Miton UK Multi Cap Income are among six funds highlighted by The Share Centre’s Sheridan Admans that that can help diversify investors’ portfolios.
Admans, investment manager at The Share Centre, also picked out GAM Star Credit Opportunities GBP, Legg Mason Japan Equity and Threadneedle US Equity Income as potential diversifiers.
Below, Admans considers the funds in greater detail.
GAM Star Credit Opportunities GBP
First up on the list is GAM Star Credit Opportunities GBP, which Admans said may be attractive to investors seeking high income returns but are worried about the interest rate environment.
Overseen by FE Alpha manager Anthony Smouha and Gregoire Mivelaz, the £1.1bn fund’s main aim is to achieve capital growth by investing across various bond categories, currencies and countries on a global basis.
Admans said: “This fund invests in the subordinated corporate bond issues of investment grade business, a style of investing that assumes there is a small likelihood of a default on a subordinated high yield issue from a high-quality issuer such as Vodafone, HSBC Holdings or Prudential for example.”
He also highlighted the use of floating rate notes (FRN) as another key attraction of the strategy, a combination Admans said should “provide a cushion regardless of rising or falling interest rates” as well as convertible bonds.
“FRN notably provides insurance against an unexpected future rise in interest rates and importantly, convertibles should also outperform in a rising rate environment,” he added.
Over three years, the five FE Crown-rated fund has been a top quartile performer, delivering a total return of 28.18 per cent compared with a 9.66 per cent gain for the average IA Sterling Strategic Bond fund.
6 March 2018
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