Strong lead for US high yield funds
Three CFS funds are leading the way in global bond sector, according to FE Analytics.
In a ranking of the performance of the global bond sector, within the Australian Core Strategies universe of 118 funds, over one year to 31 January, there was a clear trend for US high yield.
The CFS US Select High Yield, CFS High Quality US High Yield and CFS US Short Duration High Yield funds all sat in the top five funds in that sector.
The CFS US Select High Yield fund was the best-performer out of the whole sector, returning 20.8% over the period.
The fund takes a dynamic approach to investment and seeks to deliver risk-adjusted returns by exploiting opportunities across the high yield market.
This was followed by CFS High Quality US High Yield in second place, which returned 20.5%.
The remaining CFS US Short Duration High Yield fund was in fourth place with returns of 16.3%.
The US high yield market, those bonds ranked as below BBB- from S&P, can deliver higher expected returns and higher yields but are also more volatile than other types of bonds and have a higher default risk.
Over the past year, the ICE BofA US High Yield index, a commonly-held benchmark for US high yield funds, saw strong performance and returned 18.4%.
In third and fifth place as best-performing in the sector was GCI Diversified Income Wholesale Unhedged and Colchester Emerging Market Bond which returned 16.5% and 16% respectively.
The global bond sector returned 7.9% over the same period.
Performance of CFS US Select High Yield, High Quality US High Yield and US Short Duration High Yield v the global bond sector over the year to 31 January 2020
AUTHOR
Laura Dew
Recommended for you
Evidentia Group has announced the appointment of a chief risk and operating officer, rounding out its executive leadership team after a slew of hires last month.
Family office Lederer Group has progressed its takeover bid for the Elanor Commercial Property Fund, lodging a bidder’s statement with ASIC as it says the fund has been “unable to agree” on negotiation terms.
Magellan Financial Group is keen to enact further strategic expansions with income from strategic partnerships tripling to $31.1 million from the addition of Vinva during FY25.
Outflows have doubled in the property and infrastructure space to $1.3 billion with advisers instead favouring private markets as Morningstar data finds active property funds are struggling to outperform.
