AXA Investment Managers has launched a global bond fund aimed at decarbonisation, with investment consulting firm Aon providing seed capital of £127m.
The fund, dubbed the AXA ACT Carbon Transition Global Short Duration Bond fund, will be led by Nicolas Trindade, who currently manages near £2bn for AXA IM in global and sterling liquid fixed income funds. The actively-managed fund looks for short-dated fixed income investments, mostly in investment-grade bonds.
“With global yield curves still inverted, we believe this is a great opportunity to launch a fund able to select the most compelling net-zero opportunities in an asset class offering both high yields and the potential for an attractive total return,” Trindade said.
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“This fund will continue to focus on providing investors with strong downside mitigation and ‘natural’ portfolio liquidity, while ensuring that the names we invest in are committed to the net zero transition.”
Trindade’s AXA Sterling Credit Short Duration Bond fund, which he has managed since 2012, is ranked ninth in its sector over five years of performance, and second over three years, according to FE Fundinfo. In the past five years, it has returned 7.76% compared to a sector average of 2.64%.
Philippa Allen, portfolio manager at Aon, said: “AXA IM is a skilled short-dated credit manager and are pleased to have worked with them and seeded this carbon transition fund. The allocation to this strategy within several of our solutions continues Aon’s commitment to aligning its UK fiduciary portfolios to net zero.”
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Vivek Roy, senior consultant relations manager at AXA IM, added: “We are delighted to have worked in partnership with Aon to create the AXA ACT Carbon Transition Global Short Duration Bond fund. As a global leader in responsible investing, AXA IM is committed to accelerating the transition to a net zero world.
“As such, working with Aon to launch a carbon transition version of our highly successful global short-duration bond strategy has been a natural extension of our capabilities and solution-building approach to work with investment consultants and all asset owners.”
This article first appeared on ESG Clarity’s sister title Portfolio Adviser.
