ING Investment Management International has reveled that the ING (L) Renta Fund Global High Yield has surpassed the 3 billion mark in assets under management (AUM).
Significant inflows have continued despite the decrease in overall yield levels and the general fear of rising interest rates. According to the company, throughout the year the asset class has posted a positive total return driven by strong credit fundamentals that have led to a tightening of credit spreads.
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ING IM said it expects the asset class to post a positive total return in the range of 5.5 to 6% over the next 12 months.
The Global High Yield fund, which was launched in 2001, is managed on a total return basis, combining credit analysis on individual issuers with top down views on regions, credit quality, and industry sectors to construct a diversified investment portfolio that balances avoiding defaults with investments that offer attractive upside potential.
Tim Dowling, head of global high yield at ING Investment Management, said: "As valuations become more stretched and the yield on the asset class closer to historic lows, it is important to focus on segments of the market that still have potential for further tightening"
On the fund’s current strategy Dowling said: "The high yield market continues to benefit from healthy credit fundamentals which will keep default rates at very low levels. We have positioned our portfolio to benefit from this by maintaining a bias towards a careful selection of lower rated credits across our global investment universe while at the same time we have reduced our allocation to the more interest rate sensitive part of the universe."
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