Following The Adviser Centre Monthly Review Meeting held on 4^th January 2019, we have added Legal & General High Income Trust as a Recommended fund.

The fund is managed by Martin Reeves, Head of Global High Yield at Legal & General Investment Management (LGIM).  He works closely with the regional portfolio managers; Tom Huggins (US), Darrell Chan (emerging markets) and John Ryan (Europe).  They benefit from LGIM’s well-resourced and experienced global fixed income team.  The team seeks to generate attractive risk-adjusted returns through a diversified portfolio of global high yield bonds that also includes emerging market high yield bonds.  They also look to generate a level of income that is aligned to their assessment of prevailing market risk.

While their investment approach is flexible, they are guided by a strong macro structure and a robust valuation framework. In constructing the fund, they favour a “barbell” approach, creating a defensive core of lower yield, more resilient names, alongside higher spread names where they believe they are adequately compensated for the risk.  This means the fund can experience periods of greater volatility / performance divergence from the index and peers.

The fund offers pure exposure to global high yield bonds and can be used to gain broad exposure to the asset class.  The inclusion of emerging market credits differentiates it from many peer funds in the IA £ High Yield Bond sector; it is also one of the larger offerings in the sector but is commensurately diverse by issuer and underlying market.

For more information about the IA £ High Yield Bond sector, please see our IA Sector Overview.