Hargreaves Lansdown has launched a new fund – the HL Global Corporate Bond Fund – as part of its strategy to provide a wider range of portfolio ‘building blocks’ to clients.
The Bristol-based investment provider says the yield on corporate bonds has increased over the last year, driving increased interest from clients.
The fund will start trading on 20 July with a £1 fixed offer launch price until 23:59 on 19 July.
The OCF (ongoing charges figure) annual charge will be 0.62% plus any HL platform fee. There will be no platform fee on the HL JISA. On the HL LISA the platform fee will be up to 0.25% and on HL ISA/SIPPs and share accounts platform fees of up to 0.45% will apply.
There will be no trading fees for the fund and the minimum investment with be £100 on lump sums or £25 by Direct Debit.
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HL says the Global Corporate Bond fund joins the existing HL US and HL UK Income funds. HL’s Portfolio Building Block funds are “diversified, convenient investments, designed to support a broad range of client needs and goals,” according to HL.
The fund will invest mainly in investment-grade corporate bonds and will be managed by existing HL fund managers Richard Troue and David Smith. They will invest using managers from M&G, Invesco, Morgan Stanley, RBC BlueBay Asset Management and PIMCO.
The fund will invest at least 80% of money in Global Investment Grade Corporate Bonds and up to 20% in other types of debt instruments. Yield range is expected to be 4-5% and charges will be taken from income rather than capital. The benchmark will be the ICE BofA Global Corporate Bond Index.
Mr Troue 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.
“The HL Global Corporate Bond Fund is designed to be a building block, allowing everyone to become more diversified.”
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