Bank debt dominates new Alliance Trust bond fund

Alliance Trust's new corporate bond fund is set to launch with half its holdings in senior bank debt.

Former Swip manager Rod Davidson, the group's head of fixed interest, says managers Gareth Quantrill and Stuart Steven are using the recent sell-off in financial debt to populate the Monthly Income Bond fund. "During the last three weeks the banks got hit again, partly because it the most liquid part of the market and partly because of their exposure to Greek debt," he says. "We have been building up positions in senior bank debt and expect this to make up 50% of the fund." He says the managers are now looking for opportunities in credit and expecting to take positions of between £...