Low interest rates give funds in high yield sector the edge

SECTOR ANALYSIS

Peer group benefits from strong market rally as average portfolio returns 22%

The IMA £ High Yield sector has outperformed all other bond sectors over the last 12 months, with investors attracted by low interest rates and the strong market rally for most of the period. Over 12 months to 2 August, the average fund in the peer group returned 22%, according to Morningstar. Over the same period, the UK Equity & Bond Income sector’s average fund delivered 16.3%, £ Corporate Bond 16.1%, £ Strategic Bond 16.9%, Global Bond 13.7%, UK Index Linked Gilts 8.4% and UK Gilts 7.6%. Marlborough High Yield Fixed Interest is the top performer in £ High Yield over one year, up 3...