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L&G Sterling Corporate Bond Index

A fund that looks to track the performance of Sterling corporate bonds of investment grade quality

Overview

The fund aims to track the Markit iBoxx Sterling Non-Gilts ex BBB Index, which contains sterling-denominated corporate bonds with credit ratings of A or higher, with up to 5% in gilts. The tracker will hold 70-100% of the bonds in the index rather than full physical replication due to liquidity issues, the fund will utilise a variety of optimisation techniques to deliver the return characteristics of the reference benchmark. We like the tracker as it gives us exposure to a diverse portfolio of liquid bonds through the universe and it has tracked the benchmark well historically. It is also relatively cheap with an ongoing charge of 0.14% as of January 2016.

Fund type: Asset class: Sector:
Unit Trust Bonds Investment Grade

Fund Manager: Chad Rakvin

Chad has been Global Head of Index Funds at LGIM since September 2015, after joining in 2013. Prior to joining Legal & General, Chad was the Global Equity Index Director at Northern Trust, where his responsibilities included managing a diverse group of investment strategies. Chad had previous appointments with Barclays Global Investors, Dow Jones Indexes and Pennsylvania Financial Advisors and is a CFA charterholder.

Fund Group: LGIM

Legal & General Investment Management (LGIM) is one of Europe’s largest institutional asset managers and a major global investor with asset under management of £728bn (as of September 2015). L&G Investments was founded in 1970, and provide investment vehicles both active and passive across a full spectrum of asset classes including equities, fixed income, property and cash.

LGIM operates as the investment management arm of Legal & General Group, a constituent of the FTSE 100 and one of the oldest and largest insurance companies in the world, founded in 1836 as the Legal & General Life Assurance Society.