Fund Manager Luke Greenwood
MBA
Fixed income
Invesco Global Buy and Maintain Strategy
In an increasingly uncertain world, Buy and Maintain offers institutional investors the ability to generate contractual, predictable returns and match their cashflow requirements as they fall due.
At a glance
Invesco has been managing Buy and Maintain portfolios for institutional clients since 2014. Our Buy and Maintain capability spans investment grade corporates, high yield and emerging markets - and we have constantly delivered on yield targets and default avoidance.
BUY AND MAINTAIN FUNDS
To receive further information about our Funds, please contact us directly or complete the enquiry form below.
BESPOKE SOLUTIONS
We work collaboratively with clients that require bespoke portfolios, tailoring guidelines such as duration, yield and the treatment of income. We are able to target a client’s individual cashflow profile and include specific ESG preferences.
CDI SOLUTIONS
Using proprietary analytics and optimisation tools, Invesco Investment Solutions delivers cashflow-driven portfolios which include allocations to Buy and Maintain and other public and private fixed income strategies.
Objective
Our Buy and Maintain fixed income strategy aims to capture the credit risk premium from investment grade issuers within a well-diversified portfolio across geography, sector and issuer, whilst avoiding defaults and minimising turnover.
Investment approach
Our client-focused approach is centred around four factors:
- Global opportunity set: We seek opportunities for yield enhancement globally. We evaluate issuers from a global standpoint and believe that restricting the opportunity set to local credit markets may have a detrimental effect on yield and diversification.
- Diversification: We look to avoid concentration risk and apply limits to ensure that our clients are not over-exposed at the issuer, sector or geographic levels. We are flexible in our approach and can cater for any bespoke client guidelines, such as ESG requirements, when implementing a segregated solution.
- Security selection: We believe solid fundamental and ESG research is critical for successful long-term investment results. Our global credit research team are aligned to the objectives of our Buy and Maintain portfolios and each bond held is fully underwritten on its issuer’s creditworthiness by an experienced credit research analyst to minimise the risk of defaults. We have developed the IFI Watchlist with the sole purpose of flagging potential downgrades to the managers of Buy and Maintain portfolios.
- Disciplined turnover: We aim to minimise both the cost and frequency of portfolio trading. We employ a meticulous approach to credit selection at the point of purchase in order to reduce unnecessary turnover and unduly impact yield. We only sell under predefined circumstances, such as a materially increased risk of default and/or rating agency action not yet priced by the market. We believe the decision of when to hold can be just as critical as when to sell.
Why Invesco
Default avoidance: Our Buy and Maintain portfolios have consistently delivered on yield targets and we have experienced no defaults or downgrades to high yield in our investment grade mandates.
Global research platform: Our global footprint spans 14 locations, with a public credit research team consisting of 59 analysts bringing an average of 18 years’ experience and coverage of over 85% of the global investment grade corporate bond market by value. The depth and breadth of the team allows us to leverage the deep understanding of the local market knowledge and create meaningful opportunities for yield enhancement within Buy and Maintain portfolios.
ESG integration: Invesco has managed ESG-aware portfolios for more than two decades. Environmental, social and governance considerations are fully integrated into our credit research process - allowing additional risk factors to be captured aiming at better long-term risk-adjusted returns while helping to meet sustainability objectives where clients specify them.
Invesco Vision: Invesco Investment Solutions’ proprietary analytics and portfolio construction tool helps us to assess thousands of bonds and target a higher yield without compromising on quality or diversification. We focus on building implementable portfolios, using actual transaction cost data and capturing primary market issuance. This also enables us to identify optimal additions to the portfolio over time to manage credit risk over the long term.
Implementation: Our proprietary portfolio trading tool allows us to invest efficiently in global credit markets and effectively reduce the costs, risks and timeframes often associated with implementing Buy and Maintain portfolios.
Investment team
Responsibility for portfolio management rests with Invesco Fixed Income’s Global Investment Grade Corporate Bond Management team.
The Buy and Maintain strategy is led by Luke Greenwood, Portfolio Manager and Co-Head of Global Investment Grade Credit, who has over 25 years’ experience. Luke is supported by Matthew Henly, Portfolio Manager, and the wider team including Michael Booth, Portfolio Manager, and Lyndon Man, Portfolio Manager and Co-Head of Global Investment Grade Credit.
Invesco Fixed Income work collaboratively with the Invesco Investment Solutions (IIS) team in the construction of Buy and Maintain portfolios. IIS consists of over 70+ investment professionals, with an average of 15+ years’ experience across the leadership team.
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Investment risks
- The value of investments and any income will fluctuate (this may partly be the result of exchange rate fluctuations) and investors may not get back the full amount invested. The strategy will invest in derivatives (complex instruments) which will result in leverage and may result in large fluctuations in value. Debt instruments are exposed to credit risk which is the ability of the borrower to repay the interest and capital on the redemption date. Investments in debt instruments which are of lower credit quality may result in large fluctuations in value. Changes in interest rates will result in fluctuations in value. The strategy may invest in contingent convertible bonds which may result in significant risk of capital loss based on certain trigger events.
Important Information
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Data as at March 2020, unless otherwise stated. The information provided is for illustrative purposes only and should not be relied upon as a recommendation to invest in any particular asset class, security or strategy. Regulatory requirements that require impartiality of investment/investment strategy recommendations are therefore not applicable nor are any prohibitions to trade before publication. Where individuals or the business have expressed opinions, they are based on current market conditions, they may differ from those of other investment professionals and are subject to change without notice. Further information on our products is available using the contact details provided.
