Vontobel Launches High-Yield Corp. Bond Fund

Jun 11 2012 | 8:53am ET

Responding to an investment environment characterized by low-yields, inflationary pressure and limited opportunities for diversification, Switzerland’s Vontobel Group has launched a high-yield corporate bond fund.

Targeting an annual return of 5% to 9% (measured over the entire economic cycle), the Luxembourg-domiciled fund will be run by Stefan Chappot and focus on high-yield corporate bonds with credit ratings from BB+ to CCC-. The fund will attempt to produce similar returns to equities—thereby offer a hedge against inflation—but with a lower degree of risk and volatility than equities.

Said Christophe Bernard, chief strategist of the Vontobel Group, in a statement:

"With interest rates so low and massive public debt, government bonds have become less attractive. At the same time equities are very volatile and set to move sideways in the medium term. In such an environment, high-yield bonds offer a good alternative for investors searching for attractive returns."

The Vontobel Group is a Swiss private bank first established in Zurich in 1924. Vontobel specializes in wealth management for private clients and asset management for institutional investors, as well as in investment banking. As of 31 December 2011, the group held CHF 132 billion of assets.


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