Dimensional Fund Advisors launches Sterling Short Duration Real Return fund

Inflation protection

Dimensional Fund Advisors has launched a Sterling Short Duration Real Return fund to provide inflation protection to investors.

The fund will protect investors from "unexpected" UK inflation, while potentially maintaining lower price volatility and higher expected return through credit premium exposure, it explained. Dimensional said investors in index-linked gilts are subject to interest rate sensitivity and price volatility due to the small number of mostly longer-duration securities available. As a result, the fund will invest in short-duration UK gilts, both conventional and index-linked, to maintain potential lower price volatility, while providing exposure to short-duration investment grade corporate bon...