HSBC Asset Management (HSBC AM) today announced the launch of the HSBC GIF Strategic Duration and Income Bond fund.
Through dynamic asset allocation in a diversified portfolio consisting primarily of developed market bonds, including investment grade and non-investment grade fixed income and other similar securities, the fund aims to seize opportunities while navigating uncertainties in interest rate cycles, according to a statement by the manager.
Oliver Boulind, head of global credit, HSBC Asset Management, who is also the manager of the fund, said: “Given changing market dynamics, the fund tactically manages duration while taking a holistic investment view across multiple fixed income sectors, and can help investors balance and diversify plus mitigate volatility.”
“For example, high-yield and short-duration bonds may be attractive during economic expansion when interest rates are high. Conversely, long-duration government bonds may outperform if the economic outlook worsens.”
The fund invests in mid-term bonds with an average duration of three to eight years. To manage credit risk, it invests primarily in developed market bonds and currently has no exposure in emerging markets.
The fund aims to offer a fixed monthly payout of 7% (annualised payout rate of NAV, and payout may be paid out of capital and provides a choice of 10 currency share classes.
Charles Li, head of wholesale, Asia, HSBC Asset Management, said: “Rising uncertainties in the global markets are likely to translate to a more volatile market environment where the prediction of interest rate movements over a longer time horizon is always challenging, even for financial practitioners.”
“As such, investors should think hard about diversification by having a mix of fixed income investments with different maturities. For bond investors, a mid-term investment strategy can help lower interest rate risk and could be a good way to generate income and growth potential with agility.”
The fund is available to retail investors in Hong Kong starting today. Its base currency is USD; share classes are also available in other currencies including HKD, AUD, CAD, EUR, GBP, JPY, RMB, NZD and SGD.
