Artemis Strategic Bond Fund

The Artemis Strategic Bond Fund aims to provide a combination of income and capital growth over a five-year period. The managers aim to preserve capital in tough times and profit when conditions are good. In seeking to own the right bonds for each stage of the economic cycle, the fund can move between government bonds and investment-grade or high-yield bonds issued by companies.

Bonds with an investment-grade rating from credit rating agencies are considered lower risk than high-yield bonds as they are regarded as carrying a lower risk of default. High-yield bonds pay a higher interest rate or ‘yield’ because they tend to carry a higher risk of default. 

The value of the investments selected by the managers may fall as well as rise with movements in bond and stock markets or owing to factors specific to individual companies. This could mean investors may not get back the amount they originally invested. There is a risk that the issuer of a bond may default on its regular payments or not pay back the initial value of the bond at the end of the payment term.

• Flexible approach: traditional bond funds often restrict themselves to one area of the bond market. This fund, however, invests more widely, moving between government bonds and investment-grade and high-yield bonds.
• Diversified: the fund typically holds between 100 and 130 different bonds. The managers seek to avoid too much exposure to any one industry or company. The fund is diversified across industries, the perceived quality of the bond issuers and the length of time until the face value of the bond is repaid.
• ESG integration: the managers incorporate analysis of environmental, social and governance factors to insulate against emerging risks to the value of the fund’s holdings. They use a combination of external research and their own assessment tool to assess the scale of the risk and the company’s response, alongside the financial case.