Winners rationale

A tumultuous 2018 exerted significant downward pressure on high yield bonds, precipitating a noticeable outflow from the asset class as a whole. However, Fidelity International proved itself an exception by recording healthy net inflows from the region’s private banks, in large part due to its strong bottom-up credit research capabilities and thorough risk management processes.

Compared to 2017, a year that disappointed investors due to the relative lack of yield in the market, 2018 was punctuated by a rates increase and widening spreads. Against this backdrop, the firm witnessed renewed demand from its yield-hungry Asian investors for strategies providing attractive income yield premium and stellar returns.

In addition to its long track record in the HY segment globally — the firm has invested in Europe and US HY strategies since 2000 and 2001, respectively — Fidelity International became a pioneer in the Asian HY space in 2007 and now boasts the largest AUM in the market.

The firm’s HY product suite offers investors both breadth and depth and comprises global and regional HY bonds as well as country-specific bond funds. Currently, the firm manages US$85 billion in fixed income assets globally.

“We believe that one of the key drivers and basis of performance alpha in the high yield bond space is credit selection,” said Bryan Collins, head of Asian fixed income and portfolio manager at Fidelity International.

“To this end, we prioritise strong bottom-up credit research and analysis to identify names with strong potential for yield compression and/or reliable carry, while mitigating the risk stemming from credit events.”

Fidelity International’s credit research team comprises 28 professionals based in London, Hong Kong, and China, each having spent an average of 13 years in the industry and five years at Fidelity International.

Given its strong track record and exemplary performance in the HY space in 2018, as well as its commitment to its private banking clients, Fidelity International was once again voted Asian Private Banker’s Best Fund Provider – High Yield Bond.