Nomura Funds Ireland – Select US High Yield Bond Fund
Select BB-B High Yield Strategy
The Nomura Funds Ireland – Select US High Yield Bond Fund was launched in response to demand from our institutional investors for a more conservative, higher quality focussed investment strategy. This fund is part of our BB-B High Yield strategy, which has been managed by our affiliate Nomura Corporate Research and Asset Management Inc. (NCRAM), since 1995.
It shares the same underlying philosophy of our well established, and top performing US high yield bond strategy.
NCRAM’s BB-B High Yield strategy and the Select US High Yield Bond Fund focus on the higher rated segment of the sub investment grade universe, with a minimum credit rating of B3/B-.
It aims to deliver outperformance above the ICE BofA US High Yield, Cash Pay, Constrained B/BB Index of by at least 1% (gross of fees) per annum.
NCRAM: Our Specialist Credit Research Investment Boutique
NCRAM was established in 1991 and is an analyst-driven investment boutique that specialises in below investment-grade credit.
The strategy is led by NCRAM’s Amy Yu Chang, CFA and supported by a team of credit analysts. The team is focused on taking a total return, bottom-up approach, complemented by a top-down view based on criteria including default rate expectations, monetary and fiscal policy, and overall health of the capital markets.
The “Strong Horse” Philosophy
We believe a total return approach driven by credit research is the best way to generate alpha in high yield. We describe our investment philosophy as the “Strong Horse” approach. Strong Horse companies can carry their debt load through good times and bad. These companies generally have a positive ability to de-lever their balance sheet by generating strong, positive cash flows that are sustainable. The creditworthiness of these companies tends to increase over time, as will their credit ratings.
Our Investment Process
Our process differentiates us through the following points:
- Creative idea generation in an open environment.
- Thorough research conducted by experienced credit analysts.
- Disciplined portfolio construction based on the best risk and reward opportunities.
- Focus on lower-risk high yield securities, with a minimum credit rating of B3/B-.
Our approach is primarily bottom-up, though top-down perspectives are incorporated. We also characterise our process as a fundamental, as opposed to quantitative, approach.
Potential significant risks
US high yield bonds have a credit risk in addition to interest rate and exchange rate risks.
To achieve current yield and capital gains, through investment in a diversified portfolio of primarily high yielding US Dollar denominated Debt and Debt-Related Securities with a minimum rating of B3/B-. A combination of top-down and bottom-up analysis is used to identify BB- and B-rated high yield credits with strong and improving credit fundamentals.
USD 81.1 million (as at 31.05.2022)
Nomura Asset Management U.K. Ltd.
Amy Yu Chang, Portfolio Manager, Nomura Corporate Research and Asset Management Inc.
Morningstar Universe: USD High Yield Bond
IA Sector: Global Bonds
ICE BofA BB-B US Cash Pay High Yield Constrained Index
I EUR Hedged: IE00BYNJK892
For additional share class information, please contact us.
|Fund||Monthly Factsheet||Fund Snapshot|
|Class I EUR Hedged|
For a full list of available share class documents including KIIDs, please visit our fund documents page.
The lead share class fund literature is shown first in the above list. If any literature is not available in the above list for the share class you are invested in/interested in, please contact NAMupdates@nomura-asset.eu