Asset-backed securities

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Investing in a portfolio of asset-backed securities (ABS) provides exposure to an asset class with an attractive premium for complexity rather than additional credit risk. Our experienced team invests in a wide range of asset-backed securities. The security and fundamental quality of the investments offer defensive characteristics and the floating rates of the underlying securities in a rising interest rate environment.

We have two ABS pooled funds  the Libor Plus Fund* and the Liquid ABS Fund  which have been designed to meet differing risk/return and liquidity requirements. Our ABS capabilites can also be accessed on a segregated basis.

Benefits

Targets returns in excess of cash: (3-month sterling Libor) by investing in high-quality asset backed securities. 

Strong liquidity management: offering a high degree of liquidity; both funds have a high allocation to short-dated investments.

Diversification and high credit quality: the portfolios are highly diversified, with the majority of investments expected to have a credit rating of AAA or AA or equivalent.

Contractual cash flows: ABS typically offer scheduled payments, which enables investors to manage their cash flow requirements more effectively.

Bankruptcy and sovereign remote: the investor’s credit risk is related to the underlying collateral and not related to the financial health of the originating bank or sovereign. 

Insulation from interest rate risk: the floating-rate nature of the investments can mitigate the impact of future interest rate rises.

Effective return-seeking component of an LDI strategy: may be used to generate Libor-based returns for the floating-rate part of a swap or gilt-based strategy hedging.

*Please note: with effect from 11 December 2017 a temporary stop has been placed on subscriptions from new shareholders to Insight Libor Plus Fund. A maximum additional subscription of 5 million per existing shareholder applies at any weekly dealing window. Please contact your Insight relationship manager for further information.

Snapshot

In addition, we also offer the Secured Finance Fund which seeks to provide access to credit opportunities beyond the traditional investment grade space, without compromising credit quality and with the aim of minimising risk.

Fixed income team in numbers

  • 106 Fixed income investment professionals support the team
  • 17years Average experience of fixed income team
  • £121.1bn fixed income assets

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Team statistics as at 30 September 2017. Assets under management (AUM) are represented by the value of cash securities and other economic exposure managed for clients. 

Please note the value of investments and any income from them will fluctuate and is not guaranteed (this may be partly due to exchange rate fluctuations). Investors may not get back the full amount invested. Past performance is not a guide to future performance.

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