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HL Multi-Manager Strategic Bond Trust Class A - Income (GBP)

Sell:150.27p Buy:150.27p Change: 0.16p (0.11%)
Prices as at 27 October 2021
Change: 0.16p (0.11%)
You can buy or sell holdings in this fund through a Stocks and Shares ISA, Lifetime ISA, SIPP or Fund and Share Account
Prices as at 27 October 2021
Change: 0.16p (0.11%)
Prices as at 27 October 2021
You can buy or sell holdings in this fund through a Stocks and Shares ISA, Lifetime ISA, SIPP or Fund and Share Account
The selling price currently displayed is higher than the buying price. This can occur temporarily for a variety of reasons; shortly before the market opens, after the market closes or because of extraordinary price volatility during the trading day.

Our view on this Fund

This is our solution for exposure to bonds. It combines our favourite bond fund managers in a single fund and is designed to be a core investment.

David Smith and Lee Gardhouse, the fund's managers, use a flexible approach, targeting a combination of capital growth and attractive monthly income over the long term, but adopting a more defensive stance when they are cautious on the prospects for bond markets.

The fund currently combines investment grade bond funds, which invest in higher quality bonds with lower risk of default but commensurately lower incomes; higher risk high-yield bond funds; strategic bonds funds, where managers have greater flexibility in how they manage their portfolios; and more defensive 'total return' funds, which the managers hope will make money or at least offer some shelter of capital in a tougher environment for bonds.

Our view on the sector

Strategic bond funds have the freedom to invest across the fixed-interest spectrum, from traditional government and corporate bonds to higher-risk high-yield bonds. They can also invest up to 20% of the fund overseas and potentially benefit from currency movements. But this relies on the skill of the fund manager in making the right calls. Given the huge flexibility fund managers in this sector have, each fund should be judged on its own merits. Some focus on generating an income while others try to grow investors' money, or shelter it when times get tougher.

Performance Analysis

A defensive approach is currently being adopted and the managers expect the fund to perform relatively well during tougher times for bond markets, but lag behind a rapidly-rising market.

An initially cautious stance following the trust's launch in February 2009 paid off, but also meant performance lagged during the recovery from the global financial crisis. Performance has subsequently tended to be relatively good during difficult times for bond markets; however, the period since launch has seen exceptionally strong performance from bonds. The fund's volatility has generally been lower than peers and on a risk-adjusted basis returns have been good, although the fund has marginally lagged the return of its peer group.

Following such a strong run for bonds, yields have fallen to less attractive levels (when prices rise yields fall, and vice versa). The managers are therefore happy to maintain a relatively cautious approach.

Investment Philosophy

Exceptional fund managers are few and far between, but can be identified using a combination of rigorous statistical analysis and face-to-face meetings.

The managers believe bond markets can be inefficient and a select group of managers can take advantage of the opportunities this presents to add value for investors over the long term. The team seeks out these managers, blending them together in a single fund.

Process and Portfolio Construction

Analysis centres on trying to understand why a fund performs the way it does and identifying managers who can consistently deliver attractive long-term returns.

This is an on-going process, which results in a shortlist of promising managers with whom the team meets regularly. These meetings explore the manager's philosophy, process, team, and incentivisation, among other things.

From this David Smith and Lee Gardhouse construct the portfolio by blending together fund managers who they consider to be exceptional and complement each other to form a balanced and diversified fund. The overall aim is to perform well in a variety of economic and bond market conditions over the long term. The managers add to areas they see as undervalued and trim those considered overvalued. They are willing to position the fund differently to competitors and the wider market.

question mark Manager Track Record Based on HL Quantitative Research

  • HL Multi-Manager Strategic Bond...
  • IA £ Strategic Bond

Fund Track Record

27/10/16 to 27/10/17 27/10/17 to 27/10/18 27/10/18 to 27/10/19 27/10/19 to 27/10/20 27/10/20 to 27/10/21
Annual return 4.00% -0.34% 5.72% 4.23% 2.41%

Please remember past performance is not a guide to future returns. Where no data is shown, figures are not available. This information is provided to help you choose your own investments, remember they can fall as well as rise in value so you may not get back the original amount invested.

Fund Management Group Comment

Hargreaves Lansdown is one of the UK's leading independent financial services providers and asset management specialists. The business was established in 1981 by Peter Hargreaves and Stephen Lansdown and in May 2007 obtained a listing on the London Stock Exchange.

The HL Multi-Manager funds offer a broadly diversified, managed portfolio of funds through a single investment. The range includes equity and bond funds investing across the UK, Europe, Asia, and Emerging Markets and provides options for both income and growth investors. These funds are managed by our sister company Hargreaves Lansdown Fund Managers.

Information about the fund

Fund manager biography

manager photo
Manager Name: Richard Troue
Manager start date: 1 July 2019
Manager located in: Bristol

Richard joined Hargreaves Lansdown in February 2006 after completing his law degree. He joined the Investment team in February 2010, initially as an Investment Analyst, before becoming Head of Investment Analysis. In July 2019 he became part of the team responsible for managing HL's Multi-Manager funds. He currently co-manages HL Multi-Manager Asia & Emerging Markets, HL Multi-Manager Equity & Bond, HL Multi-Manager High Income, HL Multi-Manager Strategic Assets, and HL Multi-Manager Strategic Bond. He holds several investment and pensions qualifications, including the Investment Management Certificate (IMC).

manager photo
Manager Name: David J Smith
Manager start date: 2 February 2009
Manager located in: Bristol

David holds a BSc (Hons) degree in Statistics, Computing, Operational Research and Economics from University College London and an MSc in Financial Economics from Loughborough University. David also holds a variety of professional qualifications, including the Investment Management Certificate, and is a Chartered Alternative Investment Analyst (CAIA) charterholder. David joined HL in February 2008 from Citywire, where he was a founder member of the award-winning editorial team, and later became head of investment analysis. David has been co-manager of the HL Multi-Manager Equity & Bond Trust since February 2008 and the HL MM Balanced Managed Trust since July 2008. He has been co-manager of the HL MM Strategic Bond Trust since its launch in February 2009 and the HL MM Strategic Assets fund since its launch in February 2016. He also co-managed the HL MM Asia & Emerging Markets Fund from its launch in April 2015 until August 2019.

Data policy - All information should be used for indicative purposes only. You should independently check data before making any investment decision. HL cannot guarantee that the data is accurate or complete, and accepts no responsibility for how it may be used. Benchmark data provided subject to this disclaimer.
You can buy or sell holdings in this fund through a Stocks and Shares ISA, Lifetime ISA, SIPP or Fund and Share Account