“This strategy reflects our high conviction best ideas for investors who look for a high-income, potentially lower volatility strategy versus Chinese equity.”
- Bryan Collins, Head of Asian Fixed Income and Portfolio Manager.
At 6.6%, Chinese high yield bonds offer more attractive income than their counterparts in the US (6.2%) and Europe (4.3%) as of December 20171.
The fund's flexible, non-benchmark approach reduces concentration risks to specific industry, compared to market indices1.
China high yield bonds can potentially offer lower volatility than Chinese equity asset classes.
See how the fund has performed over recent years. The chart below represents the value of HK$10,000 invested in this fund since 2015.
We remain positive on China’s high yield market. Risk sentiment has weakened compared to the start of the year, and the strong global growth backdrop remains intact.
The US gradually increased interest rates given stronger than expected wage growth, which suggests that we are further into an expansionary phase of the market cycle.
Concerns over a global trade war are likely to lead to continued volatility. Our base case remains that the US and China will eventually resolve their differences. Nonetheless, the recent volatility has made valuations more attractive with a medium-term horizon.
As at 31 March 2018