Financials finally deliver for corporate bond funds

SECTOR ANALYSIS

Holding onto decimated financials post-2008 and trimming risk this year have been key calls on funds leading the £ Corporate Bond sector over 12 months.

UK credit enjoyed a spectacular 2009, with many funds producing equity-like performance as bonds rallied from massively oversold levels. This was reflected in inflows, with £ Corporate Bond outselling all other sectors for the first eight months of last year. More recently, however, there have been signs of a change in sentiment, with sectors such as Property, Cautious Managed and Absolute Return winning a greater share of assets. Corporate Bond was the lowest-selling IMA sector in January – suffering outflows that month as well as in February and May – while more flexible Strategic B...