Smith & Williamson (S&W) has added to its fixed interest range with the launch of the Short-Dated Corporate Bond fund.
It targets cautious investors with a short investment horizon of between one and three years. The aim is to yield higher than cash “without taking excessive credit risk”, says Nick Hodgson, director of marketing and sales at S&W. Gross income yield forecast at launch was 3.7% after charges.
Ian Kenny manages the fund, reporting to Chris Lynas, head of the fixed interest team. Kenny says the fund, launched on April 29, should appeal to investors looking to “bridge the gap between cash deposit rates and their income requirements.”
He adds that longer duration bonds can have high volatility levels while lower grade corporate bonds have increased risk of defaults.
The fund raised over £20m at launch and is available on Cofunds from June 1.