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Following a review of the fixed interest sector we have decided to remove the M&G Strategic Corporate Bond Fund from
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The funds share the same manager, Richard Woolnough, but the mandates differ. The Strategic Corporate Bond Fund will invest a minimum of 80% of its portfolio in higher quality investment grade bonds. The remaining 20% can be invested in higher yielding higher risk bonds, gilts, or money market investments, if the manager sees fit.
The Optimal Income Fund is unconstrained, it can invest across the fixed interest universe in investment grade, or higher yield, or gilts, depending on where the manager sees opportunity. This fund will always have at least 30% invested in higher yield higher risk bonds.
Although this may increase the fund’s risk it is this flexibility and wider ranging remit that prompted us to make this change to the Wealth 150. Given the current markets we believe a fund that is less restricted in where it can invest will be better placed to take advantage of opportunities when they arise.
If investors are happy with a fund that invests predominantly in higher quality corporate bonds we believe M&G Strategic Corporate Bond Fund will serve them well. This fund is one of the top performing in its sector since launch in February 2004. However, if you would prefer a fund with more flexibility and are willing to accept potentially higher risk you could consider the M&G Optimal Income Fund.
» Key Features of the M&G Strategic Corporate Bond Fund
» Key Features of the M&G Optimal Income Fund
Fund research is provided by Hargreaves Lansdown. Hargreaves Lansdown is an independent broker offering unit trust, stockbroking and other pension and investment services. No news or research item is a personal recommendation to deal.