Following the announcement last week that Pictet Asset Management had launched a short-term high yield bond UCITS fund, the Swiss asset ma
Following the announcement last week that Pictet Asset Management had launched a short-term high yield bond UCITS fund, the Swiss asset manager continued the theme this week with the launch of Pictet-Global Bonds Fundamental fund. The Lux-domiciled UCITS will invest in global government bonds using a fundamental approach to identify the most appropriate issuers. The fund will make no distinction between developed and emerging market sovereign borrowers. Mickael Benhaim, co-head of global and regional bonds at Pictet AM is lead manager of the fund. The new product presents an alternative to bond strategies that rely on traditional market capitalisation weighted fixed income benchmarks which suffer from a number of structural flaws. Conventional debt-weighted indices box investors in by forcing them to buy bonds of the highest borrowing sovereigns regardless of whether that debt burden is sustainable over the long term. And as Pictet AM point out, it also limits currency diversification and investors’ ability to tap into rapid capital market growth in developing economies. Commenting on the new fund, Sebastien Eisinger (pictured), head of fixed income, said: “As an alternative or as a substitute to traditional investing, investors should start by analyzing the fundamentals. Only then will they be able to reduce the risks and maximise the opportunities that are emerging in this period of rapid change for the world economy.”
