The fund aims to provide income and capital growth.
Investment policy and strategy
Core investment: At least 70% of the fund is invested in high yield bonds issued in any European currency.
Other investments: The fund also invests in bonds issued by governments (usually of developed countries), investment grade corporate bonds and cash or assets that can be turned into cash quickly, such as debt due to be repaid within a year.
Use of derivatives: Derivatives may be used to invest indirectly in core and other investments. They may also be used to reduce risks and costs and to manage the impact of changes in currency exchange rates on the fund’s investments.
Strategy in brief: The fund manager has the freedom to decide which investments to hold in the fund, based on in-depth research and monitoring of the creditworthiness of the bond issuer.
Risks associated with the fund
The value and income from the fund's assets will go down as well as up. This will cause the value of your investment to fall as well as rise. There is no guarantee that the fund will achieve its objective and you may get back less than you originally invested.
Investments in bonds are affected by interest rates, inflation and credit ratings. It is possible that bond issuers will not pay interest or return the capital. All of these events can reduce the value of bonds held by the fund.
High yield bonds usually carry greater risk that the bond issuers may not be able to pay interest or return the capital.
The fund is exposed to different currencies. Derivatives are used to minimise, but may not always eliminate, the impact of movements in currency exchange rates.
The fund may use derivatives to profit from an expected rise or fall in the value of an asset. Should the asset's value vary in an unexpected way, the fund may lose as much as or more than the amount invested.
The hedging process seeks to minimise, but cannot eliminate, the effect of movements in exchange rates on the performance of the hedged share class. Hedging also limits the ability to gain from favourable movements in exchange rates.
In exceptional circumstances where assets cannot be fairly valued, or have to be sold at a large discount to raise cash, we may temporarily suspend the fund in the best interest of all investors.
The fund could lose money if a counterparty with which it does business becomes unwilling or unable to repay money owed to the fund.
Further details of the risks that apply to the fund can be found in the fund's Prospectus.
The Fund allows for the extensive use of derivatives