Aegon AM rebrands high yield bond fund to focus on climate transition

Managed by Thomas Hanson and Mark Benbow

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Holly Downes

Aegon Asset Management has repositioned its £52m Aegon Short Dated High Yield Global Bond fund to focus on its climate transition investment criteria.

The fund has been renamed the Global Short Dated High Yield Climate Transition Fund to represent its new climate transition criteria, and will be categorised as Article 8 under the EU’s Sustainable Finance Disclosure Regulation.

Co-managers of Aegon AM’s $1bn (£785mn) Global High Yield franchise, Thomas Hanson and Mark Benbow, will continue to manage the fund alongside the firm’s responsible investment and credit research teams. The team use internal climate transition research to evaluate companies’ climate transition readiness. This will include assessments of companies’ net-zero ambitions, performance and management of climate risks.

A statement said the team will also employ a climate transition engagement programme to encourage companies to set targets and reduce emissions.

The fund will aim to deliver cash (SOFR) plus 3% per annum over three years, continuing to invest in global high yield corporate bonds with a legal maturity of less than 5.5 years.

Co-manager of the fund, Thomas Hanson, said: “The enhanced short dated high yield global bond fund aims to continue maximising returns for investors seeking attractive risk-adjusted returns and strong capital preservation, while now aligning with issuers who have clear and credible decarbonisation plans and net zero goals.

“Our team has strong experience in managing high yield strategies. This expertise will be coupled with knowledge from our specialist responsible investment team and our proprietary climate transition framework to research and categorise issuers according to their level of alignment and progress towards a net-zero economy.”

The group launched the Aegon Global Short Dated Climate Transition fund in January 2020, which now has $985m in assets.

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