Rhys Davies, manager of the newly Elite Rated Invesco Bond Income Plus Limited (BIPS), discusses the origins, goals, and strategies of BIPS. Rhys explains how BIPS focuses on generating high income primarily from the high-yield bond market and highlights the advantages of a closed-ended vehicle for this strategy. We also cover the nuances of subordinated bonds and corporate hybrids, the diversification and sectoral spread of the portfolio, and how the trust leverages opportunities in the high-yield bond market, especially during inflationary times.

What’s covered in this episode:

• The origins of the Invesco Bond Income Plus Limited
• What the trust aims to achieve for shareholders
• The advantages of a closed-ended strategy
• Opportunities in smaller more illiquid areas of the market
• What are subordinated bonds?
• …and why are they attractive?
• What is a bank CoCo?
• The importance of cashflow
• Why a “stressed” bond could be appealing
• The importance of diversification in the portfolio
• Finding investments in the riskiest part of the market
• How the trust uses gearing to maximise returns
• Portfolio positioning today
• What is BIPS dividend target?

More about the fund:
Invesco Bond Income Plus Limited (BIPS) aims to provide capital growth and a high income by investing predominantly in high-yielding fixed income securities. Rhys and his team can invest across the fixed income spectrum, but tend to focus specifically on the high yield market in Europe and the UK. The team have demonstrated their ability to manage risk through diversification, while also paying a consistent level of dividend for a number of years.

Learn more on fundcalibre.com

Please remember, we’ve been discussing individual companies to bring investing to life for you. It’s not a recommendation to buy or sell. The fund may or may not still hold these companies at the time of listening. Elite Ratings are based on FundCalibre’s research methodology and are the opinion of FundCalibre’s research team only.