Aegon Asset Management introduces a climate transition fund, focusing on investment-grade corporate bonds.

Aegon Asset Management, a leading global investment firm, has announced the launch of a new Investment Grade Climate Transition Fund. The fund, which manages $351bn in assets under management and advisement, aims to deliver resilient, risk-adjusted returns while supporting the transition to a low-carbon economy.

The fund's strategy is built on Aegon Asset Management's experience in managing the Aegon Investment Grade Global Bond Fund and the Aegon Global Short Dated Climate Transition Fund. It primarily invests in global investment grade corporate bonds, and it will leverage Aegon AM's proprietary climate transition research capacities to implement its strategy.

Rory Sandilands, the fund manager for the Aegon Investment Grade Climate Transition Fund, stated that the launch of the fund reflects Aegon Asset Management's longstanding expertise in investment grade credit and deep commitment to responsible investing. He also emphasized that the fund reflects the firm's leadership in aligning fixed income portfolios with net-zero goals.

The fund targets a 30% carbon footprint reduction by 2029 and a net zero portfolio alignment by 2040. It identifies companies based on the credibility of their corporate transition plans. The need for credible climate action has never been greater, according to Sandilands.

The fund will be co-managed by Sandilands alongside Alexander Pelteshki and Kenneth Ward. Pelteshki, a portfolio manager at Aegon Asset Management, specializes in top-down asset allocation, global strategic bond, and global credit portfolios. He is also the co-manager of the Aegon Investment Grade Climate Transition Fund, which focuses on global investment grade corporate bonds from companies with credible decarbonization plans and aims for portfolio net-zero alignment by 2040.

The current market environment, characterized by elevated corporate bond yields, resilient corporate fundamentals, and a supportive rates cycle, offers a compelling opportunity for investment grade investors. The fund aims to outperform the Bloomberg Global Aggregate Corporate Index over rolling 36-month periods, net of fees.

The new fund complements Aegon Asset Management's broader suite of climate-aware solutions. Sandilands believes the fund is well-positioned to deliver resilient, risk-adjusted returns while supporting the transition to a low-carbon economy. He also stated that the launch of the fund underscores Aegon Asset Management's commitment to responsible investing and its role in shaping a sustainable future.

Aegon Asset Management introduces a climate transition fund, focusing on investment-grade corporate bonds.