Bond fund ‘aims to outperform Bloomberg Barclays Global Aggregate Index’
Edinburgh-based fixed income manager Cameron Hume is to launch a new global bond fund for investors seeking to manage effectively the environmental, social and corporate governance (ESG) exposures of their fixed income investments.
The Cameron Hume Global Fixed Income ESG Fund will offer investors the potential to achieve active returns from a portfolio of bonds with higher average ESG ratings than their respective sectors.
The company has integrated ESG factors into its investment processes. The fund is an actively managed, globally diversified portfolio of up to 400 fixed income securities from issuers who can demonstrate that ESG risks are appropriately managed. It aims to outperform the Bloomberg Barclays Global Aggregate Index.
The fund - a UCITS (Undertakings for Collective Investment in Transferable Securities) vehicle domiciled in Dublin – was developed in response to a growing demand among investors for an ESG fixed-income offering and will launch with assets of US$100M.
Co-founder and chief investment officer Guy Cameron said: “ESG strategies are more well-established in equity investing and investors are now looking to include ESG considerations in their allocations to fixed income strategies.
“This actively managed fund is designed to be part of a core allocation to global fixed-income but will favour bonds issued by corporates with superior ESG ratings.
“So, it is a ‘returns-based’ rather than a ‘values-based’ approach that offers asset owners the opportunity to make an immediate improvement in the management of ESG exposure for their fixed income allocation. The fund will be distinctive in that we will report ESG exposures transparently using MSCI ESG ratings.”
The fund will be relevant to institutional investors, discretionary fund managers and wealth managers in the world’s developed markets including the UK, Europe and Australia, where Cameron Hume’s networks are principally located, as well as in the United States and Asia.
It comprises instruments from issuers believed by Cameron Hume to manage their ESG exposures better than their peers with an overlay of active positions drawn from a global opportunity set in rates, currency, inflation and credit markets.
The fund will exclude issuers involved in the production of controversial weapons or countries that are subject to UN, European Union or United States sanctions.
Cameron said: “By using CaTo we are able to value individual corporate bonds within industry sectors and use third party ESG ratings to evaluate the potential quality of over 3000 investment grade and high yield bonds.
“This process enables us to identify the best ESG rated bonds within each sector as a starting point for possible inclusion within the fund.”
Notes:
· Cameron Hume, founded in 2011 by Cameron, a former partner at Baillie Gifford and Christian Torkington, who held senior roles at Barclays, Standard Life and Scottish Widows, currently manages US$750million on behalf of Sanlam, one of South Africa’s largest insurers.
· Cameron Hume is a specialist fixed income investment manager providing services to institutional clients. We have a successful track record of running active and passive portfolios against the Bloomberg Barclays Global Aggregate index.
· Cameron Hume became a signatory to the UN PRI in 2015 and it applies ESG factors to fixed income portfolios having successfully integrated these into its investment process. Cameron Hume is a participant in the UN Global Compact.
· The company has distribution agreements with Melbourne-based AFM Investment Partners and with Nordicus Capital, which operates out of Stockholm.
For more details contact Carlos Alba on 0141 637 6399 or 07880 505647 or email carlos@carlosalbamedia.co.uk