Fidelity Investments has launched four new bond funds, Fidelity Global Bond Fund and Fidelity International Bond Fund, which are available to all investors, and Fidelity Advisor Global Bond Fund and Fidelity Advisor International Bond Fund, which are available through financial advisors.
The Global Bond Funds may be appropriate for investors looking for a core holding that invests across multiple countries and currencies, while providing diversified taxable bond exposure. The International Bond Funds provide many of the same potential benefits as the Global Bond Funds, but they also cater to investors looking for targeted exposure primarily to non-U.S. debt.
“Global economies have undergone significant change over recent years and the opportunities that exist in fixed income markets outside of the U.S. are unprecedented,” said Charlie Morrison, president of Fidelity’s Fixed Income division. “Leveraging our significant global fixed income investment management capabilities, we believe these new funds will appeal to investors seeking diversified global and international investment-grade debt and currency exposure.”
Jamie Stuttard, Fidelity’s head of International Bond Portfolio Management, will serve as the lead portfolio manager for the Global Bond Funds and the International Bond Funds. Curt Hollingsworth and Jeff Moore will co-manage the Global Bond Funds, while Hollingsworth will also co-manage the International Bond Funds. In addition, Matt Conti will manage the high yield assets of each fund.
The funds, which invest in sovereign government debt and corporate and securitized credit securities, will be measured against a Gross Domestic Product--weighted index. This benchmark differs from the market capitalization-weighted approach that many other global and international bond funds employ.
“The global bond landscape is in the midst of significant structural changes that should challenge prevailing assumptions and industry norms behind investing and risk management,” said Stuttard. “With this in mind, investors should pick their bond indices carefully and develop appropriate frameworks for investing in government debt, corporate bonds and currencies.”
Fidelity Investments is one of the world’s largest providers of financial services, with assets under administration of $3.6 trillion, including managed assets of $1.6 trillion, as of April 30, 2012.