Overview

Fixed income can provide a rich environment for opportunities, provided you know where to look. We tackle the fixed income market with an active mindset, believing that opportunities can always be uncovered through collaboration and insight. What’s more, as part of our purpose to create a better future through responsible investing, we collectively engage with companies and governments through LGIM’s unified fixed income, equity and investment stewardship teams to strive for better outcomes, both for investors and our rapidly changing world.

Active fixed income at LGIM

Our edge in active investing lies in our conviction that collaborative teams of experts can deliver better outcomes for investors by focusing on alpha generation and sustainability. Discover more about what makes us different below.

Diversification

We believe that consistency of returns is important across all fixed income markets, and we have a strong track record of diversifying risk in our portfolios since the early 1970s. Using diversified portfolios of traditional bonds to generate alpha in a risk managed approach, we are able to respond nimbly to opportunities when they arise, all while aiming to deliver performance over multiple market cycles.

Expertise

We bring together the best of LGIM’s expertise across a trinity of fixed income, equity and investment stewardship to collaboratively identify long-term fixed income themes and risks through the lens of sustainability. This collaborative approach also empowers fund managers to delegate management of specialist asset classes to sector experts in a risk-balanced way.

Sustainability

In line with our purpose to create a better future through responsible investing, we aim to incorporate sustainability considerations in relevant funds, using a range of techniques. Our Global Research & Engagement Groups – described in more detail below – draw on LGIM’s Active View ESG scoring tool, engagement activities and proprietary frameworks for aligning to Net Zero and the UN’s Sustainable Development Goals (SDGs).

Fixed income is an invaluable tool in any investors’ portfolio, whatever their long-term ambition. To support them on this journey, we actively pursue better, sustainable risk-adjusted returns alongside the measurement of the impact of our investment decisions
Colin Reedie, Head of Active Strategies

Responsible Investing

In line with our purpose to create a better future through responsible investing, all of our strategies aim to benefit from LGIM’s broader ESG integration and active engagement. We also offer strategies which more specifically target better long-term outcomes.

Whilst LGIM has integrated Environmental, Social, and Governance (ESG) considerations into its investment decision-making and stewardship practices, this does not guarantee the achievement of responsible investing goals within funds that do not include specific ESG goals within their objectives.

Joined-up approach to research and engagement

Cross-asset expertise is at the core of our approach

Cross-asset expertise is at the core of our approach

70+ experts organised into nine sector groups

  • Cross asset-class research platform that combines the expertise of credit, equity and investment stewardship
  • Three-dimensional lens to analyse and capture both fundamentals as well as ESG-related or ‘not-yet financial’ risks
  • Maximising our engagement efforts though a joined-up, collective stakeholder approach

 

Working together, these groups connect the macro with the micro and drive a unified engagement approach, as well as helping implement their insights across our range of high-conviction strategies, each tailored for specific sustainable outcomes:

All active strategies portfolios

  • Engage with companies for positive change through our Global Research and Engagement Groups (GREGs)
  • Focus on ESG as a financial risk at the sector and issuer level

UN SDG aligned portfolios

  • Seeking positive outcomes through targeted alignment to the United Nations’ Sustainable Development Goals (SDG) Framework
  • Exclusion of negatively aligned companies and governments

Climate aligned portfolios

  • Decarbonisation objectives based on our proprietary Destination@Risk model
  • Targeting temperate alignment of 1.5C by 2030, consistent with a net zero target by 2050

Strategies

We offer access to a wide variety of different active fixed income strategies to cover the full range of client needs, which can be used independently or together as part of a broader solution. Our capabilities include but are not limited to:

Global high yield

A strategy investing across a global universe of high yield bonds

L&G Global High Yield Bond Fund

Absolute return

A range of strategies aiming to provide consistent returns throughout market conditions

L&G Absolute Return Bond Plus Fund

Emerging market debt

A range of strategies designed to capture opportunities in emerging markets

L&G Emerging Markets Bond Fund L&G Emerging Markets Short Duration Bond Fund

€191bn AUM

In our Active Strategies

*Source: LGIM internal data as at 30 June 2024.  Includes assets from associates and is based on managed AUM, including £1.5bn from multi-asset strategies.

Recommended content for you

Further reading

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Q4 2024 Active Fixed Income Outlook: America decides

Global central banks have begun cutting rates – but the chief market determinant is sure to be (another) generationally consequential US election.

PDF file: Read more PDF size: 1100 KB
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October 2024: Active Fixed Income at a Glance

Our monthly AFI at a Glance short report covers the credit scores, strategy positioning and concise investment views of the Active Fixed Income team.

PDF file: Read it here PDF size: 784 KB
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Fixed Income in focus: Euro Credit

For the latest in our quarterly series of updates on the global fixed income market, LGIM’s Head of Euro Credit Marc Rovers gives us a detailed briefing on where the European debt market is, and where it may be heading.

Read more

Get in touch

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Get in touch

If you would like any further information please complete the contact us form. 

Key risks

The value of an investment and any income taken from it is not guaranteed and can go down as well as up, you may not get back the amount you originally invested. Past performance is no guarantee of future results.

Whilst LGIM has integrated Environmental, Social, and Governance (ESG) considerations into its investment decision-making and stewardship practices, this does not guarantee the achievement of responsible investing goals within funds that do not include specific ESG goals within their objectives.

The risks associated with each fund or investment strategy should be read and understood before making any investment decisions. Further information on the risks of investing in this fund is available in the prospectus at. http://www.lgim.com/fundcentre