The Dublin-domiciled Thames River Global High Yield Bond Fund will launch in May and will invest in around 50 holdings, focused on credits with good liquidity.
Managed by the Thames River global credit team that is led by Stephen Drew and Mehrdad Noorani, the fund is expected to invest 70% in developed markets and 30% in emerging markets.
Around 80% of the portfolio will be in high yield bonds, with the remainder investment grade. The overall credit quality is anticipated to be in the B-/B3 region. Target volatility is between 10% and 12%.
“Against a backdrop of a rebounding economies and record low interest rates, the high yield market is seeing a rapid decline in defaults and a strong pick-up in recovery rates. We see substantial implied value in high yield credit spreads and this underpins our belief that this is the ideal time to launch a fund with this remit,” says Drew.
“Over the next decade we expect new issuance of high yield bonds to triple, so we see this as an asset class which will grow over the long-term.”
The fund will be targeted at discretionaries and wholesale clients, with a minimum retail investment of £10,000 and a retail AMC of 1.5%. A performance fee will be charged over an as-yet unspecified high watermark.
