Download Schroder Fixed Income Fund - Wholesale Class Fund Summary Overview

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Fund Summary
Fixed Income Fund - Wholesale Class
The Schroder Fixed Income Fund - Wholesale Class is an actively managed, low volatility strategy that
invests in a range of domestic and international fixed income assets with the objective of outperforming
the Bloomberg AusBond Composite 0+Yr Index, whilst delivering stable absolute returns over time. It
adopts a Core-Plus investment approach whereby a core portfolio comprised of Australian investment
grade bonds is complemented by investments in a diverse range of global and domestic fixed income
securities. Investments within the portfolio are actively managed in an attempt to ensure we are in the
right assets at the right time to maximise return while maintaining a low risk profile. The targeted result is
a defensive strategy which is broadly diversified with low correlation to equity markets.
Features and benefits
Defensive strategy offering diversification benefits
–– Access to a defensive strategy offering diversification benefits against equity markets.
–– Diversified and broad investment universe of fixed income securities from which to generate returns.
–– Active management with a focus on quality to ensure rewards investors for the risk taken and remains
a true defensive strategy to deliver stable absolute returns over time.
Proven investment approach
–– Full application of investment capabilities including asset allocation (across credit, interest rate
and geography), stock selection and risk management, with top down thinking driving portfolio
–– Robust investment process and risk management framework with an emphasis on low volatility while
targeting competitive risk adjusted returns.
–– Disciplined investment approach underpinned by extensive research and detailed analysis undertaken
by the Australian Fixed Income team and investment professionals across the Schroders’ Group.
Portfolio summary
Investment Process
Performance objective
o outperform the Bloomberg AusBond Composite 0 + Yr by 1 – 1.5% per
annum over the medium term before fees
Tracking error
Expected 1.5%
Actively managed
Investment opportunity
Government and quasi-government bonds, corporate bonds across the
credit spectrum, subordinated securities developing market debt and cash.
Our broad fixed income philosophy is underpinned by 3 key ideas. Firstly, fixed income is typically
held for defensive purposes and these include liquidity, capital preservation, liability management and
to diversify equity risk. Secondly, investors should utilise the breadth of the fixed income universe to
improve risk and return outcomes (as opposed to closely tracking arbitrary benchmarks). Lastly, volatility
is not risk as we view losing money and not delivering on objectives as our core risk.
Asset allocation
In developing the portfolio’s asset allocation, we start from an absolute perspective to construct an initial
(or starting point) portfolio, unencumbered by any predetermined benchmark allocations. We combine our
medium term expectations of fixed income asset class risk and return with shorter term views on market
valuation, cyclical developments and liquidity considerations, matched against the Fund’s objectives to
develop appropriate asset allocation of the Fund. By utilising the broadest opportunity set and actively
managing these exposures in this part of the process it helps ensure we are in the right assets at the right
time which in turn helps us to achieve our broader portfolio goals such as delivering consistent returns with
limited tolerance for drawdowns and a requirement for liquidity.
Fund Summary
Schroder Fixed Income Fund
Wholesale Class
Investment process (cont.)
Security selection
Security selection is carried out in a manner aiming to exploit those areas with the most potential for adding
value. Independent fundamental credit research and active management at the security level are essential
elements of our approach which focuses on the avoidance of default and identifying value in individual
securities. As debt investors we are investing our clients’ money in assets with an asymmetric pay-off structure.
As such we undertake our own rigorous analysis and form our own independent views rather than rely on
external ratings agencies to make this assessment. We will not invest in securities we haven’t researched.
Risk management
A key element of risk management is to ensure risk is being taken in the right places and that an appropriate
level of risk is held in the portfolio. We monitor a broad array of risk measures including examining those
exposures and factors contributing to risk and the size of their risk contributions, which will influence decisions
relating to asset allocation, sector and security selection and their respective position sizing.
In the last step of the process our aim is to find the best ways to implement the investment decisions generated.
What are the risks?
Fund features
Contact Us
It is important to understand the risks associated with investing in the Fund. The main risks specifically
with investing in this Fund are market risk, interest rate risk, credit risk, derivatives risk and risks
associated with international investing such as movements in exchange rates. For further details about
the risks of investing in this Fund please refer to the Product Disclosure Statement.
Fund inception date
February 2004
Every business day
Minimum investment
Buy/sell spread
0.12% on application; 0.12% on redemption
Entry/exit fees
Management costs
0.50% pa
Normally last business day of March, June, September and December
Please call Client Services on 1300 136 471
or email us at [email protected]
Or visit us at
Disclaimer: Investment in the Schroder Fixed Income Fund - Wholesale Class may be made on an application form in the current Product Disclosure Statement (PDS) which is available
from Schroder Investment Management Australia Limited (ABN 22 000 443 274, AFS Licence 226473) website The information contained in this flyer is general
information only. It does not contain and should not be taken as containing any financial product advice or financial product recommendations. Before acting on the information contained
in this flyer you should obtain a copy of the PDS and consider the appropriateness of the information in regard to your objective, financial situation and needs before making any decision
about whether to invest, or continue to hold. The repayment of capital and performance in the Fund is not guaranteed by Schroders or any company in the Schroders Group. Opinions
constitute our judgement at the time of issue and are subject to change. Past performance is not an indicator of future performance. Investment guidelines represented are internal only
and are subject to change without notice. For security reasons, telephone calls may be taped.
April 2015 SC991