Corporate bonds are bonds or IOUs issued by companies which promise to pay interest to the bondholder until it is redeemed at a specified maturity date - when the principal amount is repaid. When you invest in a corporate bond, you are ‘lending’ money to companies who use the funds to develop their business.
We offer investors access to investment grade corporate bonds, as well as high yield corporate bonds. We also manage UK and continental European quoted debt, which can form part of investment grade corporate bond portfolios or be held as a standalone mandate. For those who would like a more diversified portfolio, we offer the opportunity to combine public and private high yield debt, in the form of leveraged loans.
The total of high yield public debt assets we currently manage is over £4.3bn*.
Managing corporate bonds is undertaken by our highly dedicated group of fund managers. Part of our extensive experience includes managing assets on behalf of our parent company, Prudential plc, – one of the world’s leading financial service providers – for many years. To complement this, we currently manage a range of segregated and pooled fund corporate bond mandates in sterling and euro denominations. We currently manage over £68bn* in public corporate bond assets.
With a large and experienced credit analyst research team – a fundamental resource when it comes to successful corporate bond investing – we are able to measure a company’s credit quality and eliminate those heading for likely distress or default. Our credit analyst team have access to fast, reliable and independent ratings – which are increasingly important, especially in today’s varying economic conditions.
M&G continually seeks to develop new products and present new ideas to the market, which is why our institutional fixed income public debt team aim to stay one step ahead when it comes to developments in the corporate bond space. Where varying market conditions exist, investor preferences are likely to shift. As part of M&G’s diverse fixed income product range, we offer corporate bond products tailored for those seeking attractive returns from their investment in this asset class. Our corporate bond products aim to compensate investors for the implied default risk and interest rate sensitivity.
In order to enhance returns and provide increased diversification, we may take tactical positions in government bonds, overseas corporate bonds, private debt assets, high yield assets and credit default swaps.
*as at 31 December 2011