Fixed-income management

Government bonds

Our investments in government bonds are distributed between countries according to the size of their economy as measured by GDP.

Most of these investments are in developed markets, with a high percentage denominated in euros, dollars, pounds and yen. These bonds will normally have a high credit rating and be very liquid. The mandate also permits up to 5 percent of fixed-income investments to be in bonds from issuers in emerging markets.

Corporate bonds

The fund invests not only in bonds issued by companies but also in covered bonds, which are issued by banks and backed by a portfolio of mortgages. Corporate bonds normally produce higher returns than government bonds.

All investments in corporate bonds follow an internal or external credit assessment. The portfolio is managed with the aim of ensuring that bonds with a credit rating below investment grade do not exceed 5 percent of the fund’s total bond holdings.