T. Rowe Price launches European High Yield strategy

T. Rowe Price has added a European High Yield Bond strategy to its fixed income range, managed by Mike Della Vedova.

The portfolio invests in corporate debt issues by sub-investment grade companies in European currencies, focusing on bonds from issuers rated BB and B.

The manager will also be able to buy lower quality bonds where he sees attractive opportunities. The main investment universe is determined by issue currency rather than country of domicile, the group said.

European High Yield Bond is available to investors via a separate account and T. Rowe Price’s Luxembourg-domiciled SICAV range. The new strategy is the second addition to the groups fixed income offering in EMEA and Asia this year.

Della Vedova said: “The European financial landscape is changing. We believe more financing of corporations will take place via bond issuance as opposed to through the banking system and, as a result, European high yield will become an increasingly significant asset class.

“Risk characteristics are potentially higher compared to other European fixed income asset classes due to European high yield’s smaller investor base and exposure to European financials.

"Nonetheless, we believe that through active management, a rigorous fundamental research approach and strong risk management, potential market inefficiencies can be captured across different jurisdictions.”