Payden & Rygel, one of the largest privately-owned global investment management firms, has launched the Payden Global Investment Grade Corporate Bond Fund.
Seeded with $50m, the new UCITS fund predominantly invests in investment grade corporate securities , combining top-down analysis of the investment environment with fundamental issuer research to identify securities offering attractive risk/return profiles.
Evolved from strategies first applied by Payden to global multi sector portfolios and offered (in the US) since 2012, the new UCITS is actively managed and will seek to outperform the Bloomberg Global Aggregate Corporate Index.
This new fund has been launched in response to institutional investors’ requirements to lock yield into their fixed income portfolios at a time when leading central banks (with the exception of the Bank of Japan) are reducing interest rates with a concomitant effect on bond yields.
Frasat Shah, senior vice president said: “The Fund is well placed to enable investors to take advantage of the higher yields currently available across the global spectrum of investment grade bonds with a specific focus on enhancing value through active management to generate superior risk-adjusted returns.
“Positions in the fund reflect our key, top-down macroeconomic views with an emphasis on generating alpha through bottom-up credit selection. Our approach is team-based with different perspectives influencing position sizes. The fund is constructed so that no single position drives performance.
“We aim to identify securities that have characteristics that we believe are mispriced and that offer superior risk adjusted return potential. Examples include opportunities in the primary market, fallen angels, relative value across the capital structure, e.g. subordinated debt, secured bonds, floating rate bonds, etc. ”
Payden Global Investment Grade Corporate Bond Fund has permitted allocations to opportunistically invest in sectors such as high yield, emerging markets or securitised debt. Active positions in the Fund are diversified to limit idiosyncratic issuer specific risks. The investment process relies on strong collaboration between the strategy team, credit analysts, economists and traders.
Initially, the new fund – Article 8 under the EU’s Sustainable Finance Disclosure Regulation classification – will be offered in US dollar, pound sterling and euro share classes.
New currency share classes will be added in response to investor requirements. Currency risk is typically hedged to the currency of the share class.
With $163.8bn under management, Payden & Rygel is one of the largest privately-owned global investment advisers. Founded in 1983, the Los Angeles-headquartered firm with offices in Boston, London, and Milan, manages fixed income and equity portfolios.
