Fixed Income
KEY BENEFITS
A research-driven fund designed for long-term growth
Leveraging on-the-ground knowledge of sector specialists and its high-quality portfolio, the Global Corporate Bond fund aims to provide your clients with resilient, long-term results.
High-quality investments only
Portfolio does not permit an active allocation to high-yield bonds as a source for excess returns
Clear risk profile with no additives
Aiming to create a stable building block for your client’s portfolio, without any surprises
Direct ideas from sector specialists
Global investment analysts are empowered to act on their convictions
WHY INVEST IN THIS FUND
When vanilla is the best flavour for your portfolio
Without ‘artificial additives’ such as high-yield to spice up its yield level, there is little need to brace for unexpected plot twists from your investment.
The experience to deliver
The investment team behind this fund
Damir Bettini
Principal Investment Officer1
London
16 years with Capital
Research Portfolio
Research analysts are allocated
part of the fund assets to manage
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Additional information on how this fund can help meet your clients’ needs
- Aimed at mitigating risk with a long-term vision
The Global Corporate Bond fund offers a high-quality approach to investment. By excluding sub-investment grade securities, this fund remains committed to long-term growth by minimising its exposure to credit risks.
- Portfolio directly crafted by a global team of sector specialists
Operating a direct pipeline from idea to investment, the Global Corporate Bond fund enables a dedicated team of global investment analysts to drive research-led returns with conviction and efficiency.
- Fundamental security selection
With the fund’s focus on fundamental research and the ability of its investment analysts to express their convictions directly into its portfolio, the majority of the fund’s excess returns is expected to be driven through security and industry selection.
Recent global events have set the stage for uncertain economic times.
Offering the potential for stability and resilience
- Periods of uncertainty highlight the importance of having a fixed income allocation in a portfolio. Our Global Corporate Bond fund is especially suited; its portfolio is dedicated to investment-grade issues and does not actively allocate to high-yield credit, resulting in greater stability and resilience from its lower credit risk.
Volatility can exacerbate risk
- With today’s market volatility, scope creep (an intentional allocation to riskier, high-yield issues) should be avoided more than ever, as any risks can be amplified. We believe bond funds should behave like bond funds.
An information advantage
- With the macroeconomic environment shifting rapidly, this is a good time for active management. This is especially true for the Global Corporate Bond fund, where a team of sector specialists build the portfolio alongside the Principal Investment Officer. With a deep understanding of the individual industries and sectors, our analysts can react quickly when the market environment changes.
The fund’s investment objective is to provide your clients, over the long term, with a high level of total return consistent with capital preservation and prudent risk management by investing in corporate investment-grade bonds worldwide.
- High-quality returns: This fund consists of exclusively investment-grade credit, selected by a global team of sector specialists, while some of its peers may be actively allocating to high-yield securities. The goal? To provide more stable outcomes for your clients’ investment-grade credit exposure.
- Long-term vision: Excluding riskier high-yield bonds to avoid uncertain short-term wins enables the Global Corporate Bond fund to stick to its longer-term vision, and provides a clear risk profile when incorporated as part of your client’s investment portfolio.
Invested capital is at risk; the funds aim to achieve a positive return over the long term although there is no guarantee this will be achieved over that or any time period.
Fundamental research drives security selection within the Global Corporate Bond fund portfolio. Integration with equity research allows our fixed income analysts to build truly differentiated insights, and 90% of expected excess returns are driven through security and industry selection. The fund’s consistent track record evidences Capital Group’s success when investing in this corporate bond asset class.
Adopting a truly long-term investment strategy is a crucial part of the Global Corporate Bond approach.
Past results are not a guarantee of future results.
Taking the long view
We base our investment decisions on a long-term perspective, aligning our goals with the interests of your clients. Superior, long-term returns are our goal. The Global Corporate Bond investment team is rewarded for their results, not the level of assets they manage.
Breadth of experience
Our process enables individual investment professionals to act on their highest convictions while limiting the risk associated with isolated decision-making. We draw on their diverse expertise and experience to build the portfolio.
Deep, fundamental research
Few firms can match the scale and scope of our proprietary research. Investment analysts conduct thousands of research visits globally every year. This research is then combined with comprehensive macro analysis. This approach has been essential to the results we have delivered to our investors.
Capital Group manages equity assets through three investment groups. These groups make investment and proxy voting decisions independently. Fixed income investment professionals provide fixed income research and investment management across the Capital organisation; however, for securities with equity characteristics, they act solely on behalf of one of the three equity investment groups.
ESG FOCUS
ESG characteristics
ESG is woven into our investment process through three tightly integrated components: investment frameworks, monitoring and engagement. The fund also applies ESG and norms-based screens and has a carbon target.1
For more information on our approach, to ESG please see ESG at Capital Group.
Screens
The fund excludes issuers within certain sectors, as well as those that violate UN Global Compact principles and sovereigns that score below the Capital Group proprietary framework’s ESG threshold.
Carbon target
The fund’s carbon footprint is also monitored and managed to maintain a carbon footprint below the index level (for eligible securities)2.
The fund has adopted Sustainable Finance Disclosure Regulation (SFDR) article 8 requirements. The SFDR classification is related to the EU’s regulation and is not equivalent to approval or recognition as an ESG fund by regulators in Asia Pacific.
Find out more about what this fund has to offer
WHY CAPITAL GROUP
A leader in global investing
For more than 90 years, we’ve been searching the world for long-term opportunities, making Capital one of the oldest global investors today.
Global investing credentials
US$2.5T
in total assets managed
26 years
average investment experience of our fixed income portfolio managers
US$498.0B
Fixed income assets managed*
*Assets under management by Capital Fixed Income Investors.
Data as at 31 December 2023
High conviction investments. Diverse perspectives.
The Capital SystemTM is designed to produce highly diverse portfolios that deliver consistent long-term results, a smoother ride and management continuity over a range of market conditions.
We believe ESG is key to successful investing. So we consider environmental, social and governance issues before we invest.
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Risk factors you should consider before investing:
- This material is not intended to provide investment advice or be considered a personal recommendation.
- The value of investments and income from them can go down as well as up and you may lose some or all of your initial investment.
- Past results are not a guarantee of future results.
- If the currency in which you invest strengthens against the currency in which the underlying investments of the fund are made, the value of your investment will decrease. Currency hedging seeks to limit this, but there is no guarantee that hedging will be totally successful.
- Some portfolios may invest in financial derivative instruments for investment purposes, hedging and/or efficient portfolio management.
- There are additional Bonds, Counterparty, Derivative instruments, Operational and Sustainability risks associated with this fund.
Fund risks
Bonds risk: The value of bonds can change as a result of interest rate changes – typically when interest rates rise, bond values fall. Funds investing in bonds are exposed to credit risk. A decline in the financial health of an issuer could cause the value of its bonds to fall or become worthless.
Counterparty risk: Other financial institutions provide services to the fund such as safekeeping of assets, or may serve as a counterparty to financial contracts such as derivatives. There is a risk the counterparty will not meet their obligations.
Derivative instruments risk: Derivatives are financial instruments deriving their value from an underlying asset and may be used to hedge existing exposures or to gain economic exposure. A derivative instrument may not perform as expected, may create losses greater than the cost of the derivative and may result in losses to the fund.
Operational risk: The risk of potential loss resulting from inadequate or failed internal processes, people and systems or from external events.
Sustainability risk: Environmental, social or governance event or condition that, if it occurs, could cause an actual or potential material negative impact on the value of an investment of the fund.
Data as at 31 December 2023 and attributed to Capital Group, unless otherwise specified.
- Carbon footprint data is based on weighted average carbon intensity.
- For securities for which this can be measured, currently defined as corporate bonds. Carbon footprint is based on weighted average carbon intensity. Index refers to 45% Bloomberg US Corporate High Yield 2% Issuer Capped Index, 30% Bloomberg US Corporate Index, 15% JPMorgan EMBI Global Diversified Index, 8% Bloomberg Non-Agency CMBS Ex AAA Index and 2% Bloomberg ABS Ex AAA Index.