Joining the Hargreaves Lansdown (HL) US and UK Income funds, the HL Global Corporate Bond Fund has joined the bank’s portfolio building blocks.
The HL Portfolio Building Blocks are diversified, convenient investments meant to boost a broad range of client needs and goals.
In addition, the fund will invest mainly in investment-grade corporate bonds. This is due to the yield on these bonds increasing over the last year and driving interest from clients.
The fund will start trading on 20 July 2023 and the minimum investment is a lump sum of £100 or £25.
It will be overseen by HL fund managers and has these features:
- Richard Troue and David Smith are the HL fund managers, they’ll invest using managers from M&G, Invesco, Morgan Stanley, RBC BlueBay Asset Management and PIMCO;
- The fund will invest at least 80% of the money in Global Investment Grade Corporate Bonds and up to 20% in other types of debt instruments;
- Yield range expected to be 4-5%;
- Monthly income – any income received will be distributed each month to holders of the income class;
- Charges taken from income rather than capital, and
- ICE BofA Global Corporate Bond Index benchmark
Richard Troue, fund manager, Hargreaves Lansdown, said: “Every investor beyond the most adventurous should invest in this sector as part of a diversified portfolio. Rising interest rates and volatile equity markets have seen increased interest in corporate bonds. With expectations that interest rates could be nearing their peak, those buying into bonds now benefit from the higher yields being paid and benefit from capital gains as well.
“The HL Global Corporate Bond Fund is designed to be a building block, allowing everyone to become more diversified. We’re partnering with a blend of external fund managers, with different styles and areas of expertise. They’ve all demonstrated strong processes and delivered strong long-term returns for investors.”