Royal London Asset Management (RLAM) is set to launch three short duration fixed-income funds to extend its fixed income capabilities.
Paul Rayner, the firm’s head of government bonds, will head up a short duration gilt fund, while Craig Inches will run a short duration index-linked fund and Sajiv Vaid will run a short duration credit fund.
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Vaid will target a yield of between 2.75% and 3% for the Short Duration Credit fund. Rayner’s gilt fund will have a target yield of between 1% and 1.25%.
The launches are subject to regulatory approval and will be available at the end of third quarter.
A spokesperson for RLAM said: "The current low interest rate environment has reduced the attractiveness of bond funds with longer duration and we are therefore developing a range of short duration funds to meet client demand.
"It is our view that interest rates will remain on hold for the foreseeable future, but when they start to go up again then obviously the funds with lower duration and less sensitivity to change will provide a degree of protection against these rates," he added.
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