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SDG ENGAGEMENT HIGH YIELD CREDIT

A high yield credit strategy that seeks to deliver returns to investors and society

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We've created a global credit strategy intending to deliver high-yield returns whilst also allowing investors to invest in positive change in society and the environment

Mitch Reznick & Fraser Lundie

Co-Portfolio Managers

Engagement strength

Committed to active corporate engagement since 1983, we have a large team skilled in face-to-face engagement with corporate executives and directors

Investment Expertise

A credit team whose co-heads have worked together for nearly 15 years to deliver superior, consistent returns with a focus on security selection across geographies, capital structures and debt instruments

Sustainable focus

The SDGs provide an ideal framework to identify ex-ante potential for creating positive change through engagement to create more impactful and profitable companies

What are the Sustainable Development Goals?

The SDGs are a universal set of goals, targets and indicators for global development. They serve as a blueprint for significantly changing the world — by ending global poverty, safeguarding the planet and aiming for prosperity for all — by 2030. Established by the UN in September 2015, the SDGs were adopted by the international community, including 193 governments.

There are 17 SDGs, and within these goals there are 169 targets and 230 indicators. They are integrated and indivisible and balance three primary dimensions of sustainable development: the economic, social and environmental. To achieve these goals, it is estimated that it will require an investment of between $5-7tn each year until 2030. Approximately $1tn comes from public funds from the UN and member countries annually, while private capital must fund the remaining $6tn annually. Learn more about the SDGs here. 1

  1. 1"UN Sustainable Development Goals," published by UN PRI as at November 2017

Hermes SDG Engagement High Yield Credit - Mitch Reznick
Hermes SDG Engagement High Yield Credit - Aaron Hay

Key characteristics

Portfolio Managers Mitch Reznick, CFA; Fraser Lundie, CFA
Lead Engagement Manager Aaron Hay
Inception date Sept 26 2019
Benchmark ICE BofAML Global High Yield Index hedged to USD*
Instruments Primarily high-yield corporate bonds
Approximate number of issuers 75-100
Base Currency USD, hedged (no active currency positions are taken versus the benchmark)*
Liquidity Daily
Tracking Error Typically 2-4%, ex-ante

*The Company shall use the above benchmark for performance comparisons with the Fund, as deemed appropriate. For the avoidance of doubt the Fund’s objective is not to track the performance of an index or benchmark. The Fund does not charge any performance fees and, accordingly, no fees are paid to the Investment Manager on the basis of outperformance of an index or benchmark.

Opportunities throughout the value chain

Team

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