Sector Fund Range

Omnis Absolute Return Bond Fund

Investment Manager

Hermes Investment Management

FUND MANAGER

Fraser Lundie

KEY FUND FACTS

  • Flexibility- the investment process is designed to adapt to current and expected market conditions,nabling the manager to target positive returns in all market environments.
  • Choice of investments- the team’s extensive experience of investing in bonds and currencies opens up a wide range of opportunities for the fund.
  • Risk management- the team dedicates significant resources towards understanding the sources of risk, such as exchange rates or geopolitics, in the portfolio’s holdings.

INVESTMENT OBJECTIVE

The Fund aims to achieve a return consisting of both income and capital of 2% above the rate of cash, measured as GBP SONIA (3 Months), after all fees and expenses, over a five-year rolling period. There is no guarantee that this will be achieved over this, or any, timeframe and capital is at risk.

INVESTMENT POLICY

The fund intends to invest in a globally diversified portfolio with at least 80% invested in a broad range of fixed income securities such as global government bonds, corporate bonds and currency markets. The fund will invest in bonds issued either in sterling, or in another currency which will be hedged back into sterling. The fund may invest up to 60% in sub-investment grade bonds (considered to be Standard & Poor’s credit rating of below BBB or equivalent).

The fund may also invest in other transferable securities, units in collective investment schemes (including schemes managed and operated by the ACD or its associates), money market instruments, warrants, cash, near cash and deposits as detailed in the Prospectus.

Derivatives may be used both for investment purposes and for efficient portfolio management.

INVESTMENT PROCESS OVERVIEW

The manager believes that delivering positive returns depends not just on researching individual companies, but also on identifying the right bond among the many issued by that company. This philosophy has been used since the investment team first worked together in 2004 and has stood the test of time.

The team starts by investigating the influences on the bond markets including fundamental factors like the state of the global economy and how much risk investors are willing to take. They use this research to narrow down the choice of investments. The fund tends to target larger companies because they issue a wider range of bonds.

The fund is not limited to investing in the largest bond markets in the US and Europe, it also looks for investment opportunities in emerging markets. This allows the fund to further diversify its holdings and to avoid markets that the manager believes are overvalued. 

The fund is actively managed and the manager has full discretion when choosing assets to invest in (in-line with the fund’s investment objectives).