Milford to meet adviser needs with dual fund launch

Milford Australia has launched two funds to market, driven by advisers’ need for more liquid, transparent credit solutions that meet their strong appetite for fixed income solutions.

In March, Milford announced its intention to launch three funds this year – an Australian equity, a global equity, and a corporate bond fund – after conducting a consultation with financial advisers in 2024 to determine where the firm could meet gaps in the fund management market.

Backing up this promise, Milford has now launched the Corporate Bond Plus Fund - an actively managed, fixed-income fund, investing in public traded Australian investment grade corporate, government, and semi-government securities.  

Benchmarked on the Bloomberg AusBond Credit 0+ Year index, the fund offers daily liquidity and quarterly income distribution, managed by Anthony Ip and Paul Morris.

The launch of this fund, according to the firm, comes amid a period of strong growth in credit investing in the Australian market, partly as a response to the expansion of private market offerings.

Milford has also launched the Active 100 Fund, a high conviction domestic equity fund investing in ASX 100 listed Australian equities and benchmarked against the S&P/ASX 100 Equal Weight (TR) Index. Managed by Jason Kururangi and Roland Houghton, the fund offers annual income distributions with a recommended investment timeframe of at least eight years.

Speaking on the announcement, Milford Australia chief investment officer and executive director, Wayne Gentle, said he believes advisers will welcome the opportunity of an actively managed differentiated fixed income offering that “targets alpha generation in a liquid and transparent fashion”.

He noted that advisers’ needs in this sector have shifted somewhat, explaining that although there is ongoing appetite for fixed income solutions, “there is also a desire to avoid surprises”.

“This strategy isn’t just about security selection or interest rate duration; alpha is generated from multiple sources including sector rotation and relative value opportunities. We feel this is quite a unique offering in the market, and this timing is very opportune for advisers,” Gentle said.

Pointing to the Active 100 Fund, Gentle said the selection of the equal weighted benchmark was driven by advisers' disillusionment with the ASX 200, explaining that it has become one of the most concentrated benchmarks in the world, making it susceptible to outsized moves.

Gentle added: “While the equal weighted index is a harder benchmark to beat, philosophically it’s more strongly aligned with our high conviction approach. This fund offers the familiarity of the ASX 100, but the equal weighted approach allows for greater diversity of sector exposure and thus more opportunity for genuine alpha.”