AXA World Funds US High Yield Bonds Fund
Ongoing geopolitical tensions, interest rate uncertainty and intensifying concerns over global growth are contributing to a precarious environment, and with fears that an unsettled market could continue for the foreseeable future, investors searching for yield have been left in a difficult position.
AXA World Funds US High Yield Bonds fund is an actively managed portfolio that seeks to generate attractive total returns by investing in the full maturity and quality spectrum of the sub-investment grade debt of mostly US companies. The Fund aims to compound high income while aiming to minimise principal loss by employing a credit-intensive, bottom-up approach.
What makes the fund interesting?
Seeking higher total return potential than investment grade fixed income.
Aiming for additional portfolio diversification.
Looking for access to the US high yield market.
Three reasons for investing in the fund
Capture returns through a disciplined investment process driven by fundamentals
The investment process focuses on bottom-up, fundamental analysis combined with a strong top-down component, focused on identifying risks and opportunities associated with the overall economy and market.
Access the US high yield market with an experienced, knowledgeable team
Our dedicated team of US high yield credit specialists have experience throughout multiple economic and credit cycles, with resources designed to meet the needs of a large, global client base.
Minimise default risk in turbulent markets with an active strategyThe table below shows the total number of defaults that have occurred in the broad US high yield broad market since 2007, compared with the AXA World Funds US High Yield Bonds fund. Most notably, during the financial crisis of 2008/09, the Fund had just two defaults compared with 112 across the US HY broad market.2
Credit Risk: Risk that issuers of debt securities held in the Sub-Fund may default on their obligations or have their credit rating downgraded, resulting in a decrease in the Net Asset Value.
Liquidity Risk: risk of low liquidity level in certain market conditions that might lead the Sub-Fund to face difficulties valuing, purchasing or selling all/part of its assets and resulting in potential impact on its net asset value.
Counterparty Risk: Risk of bankruptcy, insolvency, or payment or delivery failure of any of the Sub-Fund’s counterparties, leading to a payment or delivery default.
Impact of any techniques such as derivatives: Certain management strategies involve specific risks, such as liquidity risk, credit risk, counterparty risk, legal risk, valuation risk, operational risk and risks related to the underlying assets. The use of such strategies may also involve leverage, which may increase the effect of market movements on the Sub-Fund and may result in significant risk of losses.
The number of US fixed income investment professionals at AXA IM (1)
defaults in the Fund since its launch, compared with 407 in the broader market (2)
US high yield credit specialists at AXA IM (1)
(1) Source: AXA IM as at 31 March 2021. Information about the staff teams and / or AXA Investment Managers is only informative. We do not guarantee the fact that staff remain employed by AXA Investment Managers or continue to exercise in the teams of AXA Investment Managers.
(2) Source: J.P. Morgan and AXA Investment Managers as at 1 July 2020. The Fund launched on 29 November 2006.