Pioneer Investments launches absolute return bond Sicav

Pioneer Investments has launched Sicav- Absolute Return Sterling Bond,an extension of its Absolute Return Bond strategy.

 Pioneer Investments’ Absolute Return Sterling bond strategy has been designed to meet a range of investor’s needs including those of UK institutional investors, wholesale distributors, multi-managers and private banking clients, the firm also said.

The fund aims to deliver capital preservation whilst generating positive returns in rising or falling markets. Employing the use of Pioneer Investments’ unique portable alpha approach, the fund does not rely on market beta to generate returns. The core strategy aims to deliver cash-like returns based on SONIA, with the fund’s overall target return being SONIA+4%.

Pure absolute returns may be generated from a range of diversified alpha strategies such as sovereign exposure, currency and UK curves. An individual specialist portfolio manager, who is assigned a risk budget, manages each single alpha strategy. The aim is to optimize risk-adjusted returns whilst taking into account the positive effects of diversification between the core strategy and the multiple alpha-generating strategies.

Launched in December 2013, the strategy is co-managed by Pioneer Investments’ European Fixed Income and Credit teams who average over 10 years’ investment experience. The lead Portfolio Managers, Tanguy Le Saout and Cosimo Marasciulo have worked together for over 10 years.

David Hanratty (pictured), head UK & Ireland Distribution said: “Rising yields and falling bond prices are becoming a reality. The real question here is the timing and the pace at which they will rise. We believe that investors now need to consider new approaches to fixed income investing, stepping away from traditional mandates, and considering alternative and innovate approaches”.

Key features of Pioneer Funds – Absolute Return Sterling Bond

  • Absolute return-driven, multi-sector investment grade bond portfolio
  • Possibility to have negative interest rate and credit spread duration 
  • Core portfolio designed to replicate SONIA returns and volatility
  • Alpha strategies seek to capture lowly correlated absolute returns across a broad opportunity set
  • Strict risk management framework allows monitoring of profit/drawdown of each position



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