The Axa IM Maturity 2023 Fund is a sub-fund of the Axa IM World Access Vehicle Icav, an Irish Ucits Icav. The launch follows earlier launches in 2015 and 2016 of similar Maturity funds that expire in 2020 and 2022 respectively.
The new fund is divided into distribution shares classes, where investors receive dividends annually or quarterly depending on their class; and capitalisation share classes, where investors will not receive any dividend.
European high yield growth
Yves Berger, manager of the fund, said: “We’ve seen strong growth in the European high yield market since 2009 – it is now approximately a €350bn (£303bn, $370.2bn) asset class and has an increasingly diversified issuer base.
“Our strategy with this fund is to invest in securities we believe we can hold for the full term of the fund and to diversify the portfolio as much as possible to minimise the risk of defaults.
“It is almost impossible to time the market so our approach of investing with a fixed maturity aims to help clients tackle the ongoing challenge of low yields and volatile markets. By staying invested for the full six-year life of the fund, investors can pay less attention to the interim price movements; the fund is designed to be held until the maturity date.”
Early redemptions will be subject to a 2% fee, Berger added.
Chris Iggo, chief investment officer of fixed income at Axa IM, said: “European high yield remains one of the few places where investors can still find attractive yields.
“As interest rates in Europe look likely to remain low, investors seeking a higher total return and willing to take on more risk could consider turning to this asset class as part of diversifying their sources of income.”