Global High Income Opportunities | Capital Group

TOTAL RETURN FIXED INCOME

Global High Income Opportunities

Vehicle: Collective Investment Trust, Separate Account

Overview

Objective: Seeks high total return, with a large current income component, by investing primarily in global high-yield securities. 

  • Strategy inception date: 1998
  • Assets in strategy (millions): $1,177.1
  • Benchmark: 
    • 50% Bloomberg Barclays U.S. Corporate High-Yield Index, 2% Issuer Cap
    • 20% JP Morgan EMBI Global
    • 20% JP Morgan GBI-EM Global Diversified
    • 10% JP Morgan CEMBI Broad Diversified 
  •  Maximum below-investment-grade bonds (%): 100
  •  Currency (%): 
    •  USD allocation: 30–100  
  • Invests in: 
    • Emerging markets debt
      • Corporate
      • Sovereign
    • U.S./Non-U.S. high-yield corporate bonds
  • Minimum account size (millions):
    • Defined contribution: $0
    • Collective investment trust: $5
    • Separate account: $100

For a DC collective investment trust, plan size of $250 million may be used to satisfy the minimum account size requirement.

Assets in strategy as of June 30, 2018.


Approach
  • Research is the cornerstone of Capital’s investment process, which integrates macroeconomic, fixed income and equity analysis from all regions of the globe
  • Our fixed income analysts leverage our integrated approach, typically specializing in one or more industries and/or sectors, and drawing on the work of their counterparts in our equity research group
  • Emerging markets analysts further cover a geographical region to better understand the investability of their universe and potential contagion correlation effects. Other fixed income analysts focus on quantitative and qualitative research on securitized debt. In addition, a strategic group is dedicated to currencies, asset allocation, quantitative research, politics and other macro issues
  • The Global High-Yield team consists of two portfolio managers, each of whom manages a portion of the total portfolio, ensuring that the portfolio has diverse sources of return
  • The portfolio managers seek to add value through research-driven country, currency, sector and security selection, which may include substantial investments in individual bond markets and currencies based on our views of the macroeconomic cycle, monetary policy and similar issues
  • The portfolio managers also work closely with Capital’s traders, who provide invaluable information about anomalies, inefficiencies and deal flow in the market in addition to executing trades
  • We have a comprehensive framework for addressing risk
    • Our research process and The Capital System℠ help diversify the portfolio
    • Capital’s independent global investment control group monitors compliance with portfolio guidelines
    • Our legal and compliance team helps make certain we adhere to regulations in the markets in which we invest

History of Fixed Income at Capital Group

We began managing fixed income assets for institutional clients in 1973, and Capital Fixed Income Investors had $320.9 billion in assets under management as of March 31, 2018.

We began managing a global high-yield strategy in 1998, after nearly a decade of experience managing both emerging markets debt and high-yield debt separately. We began investing in emerging markets debt in 1991, created an emerging markets debt fund in 1994, and most recently (2007) began managing emerging markets debt “linkers” strategies for institutional clients. We were one of the first to begin managing emerging markets equities in 1986 and launched our first private equity fund for emerging markets investments in 1992. Capital began managing high-yield bonds in 1984.
 


Portfolio Management Team


 


Resources


Fund Characteristics

Defined Benefit Plans (PDF)

Defined Contribution Plans (PDF)

Endowments/Foundations (PDF)


Additional Reports

Annual Report (PDF)

 

 

 


The Capital Group companies manage equity assets through three investment groups. These groups make investment and proxy voting decisions independently. Fixed income investment professionals provide fixed income research and investment management across the Capital organization; however, for securities with equity characteristics, they act solely on behalf of one of the three equity investment groups.

Any collective investment trusts (“CITs”) available under the strategy shown are maintained by Capital Bank and Trust Company (“trustee”), which has retained an affiliate to serve as investment adviser to the trustee for the CITs.

Investors should carefully consider investment objectives, risks, charges and expenses. This and other important information is contained in the mutual fund prospectuses/summary prospectuses, which can be obtained from a financial professional, and should be read carefully before investing. Similar information about collective investment trusts can be obtained from Capital Group or participants' plan provider or employer.


Investments are not FDIC-insured, nor are they deposits of or guaranteed by a bank or any other entity, so they may lose value.