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.
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.”
