JPM to change investment policy on sterling corporate bond fund
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JP Morgan is planning to change the investment policy of its sterling corporate bond fund.
Since 2007, the fund has focused on investment grade corporate and government issues with the ability to invest up to 100 per cent in certain government and public securities.
It was also able to invest in non-investment grade securities, including corporate and emerging market bonds where deemed appropriate.
In the majority of trading conditions the fund has had large exposure to investment grade corporate bonds, either denominated in sterling or in other currencies but normally hedged back to sterling.
However, in a letter to shareholders this week JPM says: “the fund’s existing ability to invest significantly in government and public securities may cause issues for clients who primarily want exposure to corporate bonds.”
It is therefore proposing to change the investment policy from February 1, 2010 to focus on investment grade corporate issues.
The fund may also invest in non-investment grade securities, including corporate and emerging market bonds, where the investment adviser believes these offer significant opportunities.
It may also use derivatives for investment purposes or efficient portfolio management including hedging, where appropriate. Although most of the non-sterling securities will be hedged back to sterling, the investment adviser will also use the foreign exchange market to maximise returns.
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