M&G Global Dividend - Silver
Lena Tsymbaluk, associate director, equity fund research
A strong option in the Global space is M&G Global Dividend fund, which has a Morningstar Analyst Rating of Silver. It has been managed by an experienced investor Stuart Rhodes since July 2008. Rhodes has navigated the strategy well through different stages of the economic cycle and adhered to his investment philosophy and convictions when facing headwinds. He sometimes goes against the grain, but has demonstrated his stock-picking talent over time. Owing to the focus on dividend growth, the portfolio’s yield is typically lower than for peers or the MSCI World High Dividend Yield Index while also displaying a milder value tilt versus competitors. Rhodes selects a compact portfolio of 40-50 stocks through bottom-up fundamental analysis where he has put more emphasis on financial leverage in recent years. The track record built by Rhodes points to strong total returns, beating peers and the index by a comfortable margin.
Jupiter Strategic Bond - Silver
Evangelia Gkeka, senior manager research analyst, fixed income
The fund is Silver-rated for its clean share class (Jupiter Strategic Bond I). Veteran portfolio manager Ariel Bezalel has been at the helm here since its inception in 2008 and boasts more than two decades of portfolio management experience. Bezalel’s experience, the continuity he provides and his dedicated portfolio management focus on this particular strategy drive our positive conviction. Harry Richards was promoted to assistant fund manager in 2016 and co-manager in June 2019. The managers are further supported by a team of 17 sector-focused analysts, which has grown over the years along with the level of assets in the strategy.
The strategy utilises a flexible investment process that combines top-down and bottom-up elements and invests across a wide opportunity set that includes high-yield bonds, investment-grade bonds, government bonds, emerging-markets debt, and, to a lesser extent, currencies and derivatives. The portfolio is constructed with a barbell approach balancing the capital preservation features of high-quality government bonds and the credit-heavy income-generation of high-yield debt (including subordinated financials). Additional levers include duration management, opportunistic exposure to individual themes (such as select emerging-markets stories), and some limited active currency trades. Bezalel relies on third-party research to formulate his macro views and the portfolio's stance with regard to sub-asset-class exposure, duration, and yield-curve positioning. Since 2008 Bezalel has proven his effectiveness at using the flexible process and resources at his disposal to take advantage of the wide opportunity set. The balanced approach to portfolio construction has been key to containing downside risk and, at the same time, keeping up with market rallies. Since inception in 2008 the strategy outperformed its peers and category index on an absolute and risk-adjusted basis.
BNY Mellon Multi-Asset Balanced - Bronze
Tom Mills, senior manager research analyst
The multi-asset balanced fund’s focus is delivering competitive performance versus the IA Mixed Investment 40%-85% Shares sector. Manager Simon Nichols aims to achieve this primarily through security selection, with asset allocation also playing a role.
Since taking over in January 2018, Nichols has shifted the risk profile from capital protection, to positioning that is more peer group- and benchmark-aware. Under his management the allocation to equities has typically been in the range of 70%-80% with bonds, cash, and some gold making up the balance. Overall asset allocation is driven by Nichols along with other senior members of the multi-asset team. Fundamental analysis is carried out by Newton's research analysts, who assess securities within a global context fitting their thematic views. We think Nichols makes effective use of Newton’s research platform. Despite a changing market backdrop, he has been able to generate consistently strong relative returns since taking charge of the fund. Nichols also has a strong track record on longer-running BNY Mellon Newton Global Balanced, which he took over in 2013.
