M&G Investments will launch the Optimal Income bond fund, which can utilize derivatives and invest in different assets, according to Reuters.
Fund manager Richard Woolnough will run the fund expected out within the next month, says an M&G spokeswoman.
Multiple firms have recently launched funds under the European Union’s UCITS III directive, which allows regular funds to use different strategies like derivatives and leverage.
“It’s an all-encompassing, flexible fixed interest fund … (and) it’s a fund we like the look of … M&G certainly have the track record and the capability to run this,” says Darius McDermott, managing director of discount broker Chelsea Financial Services, who has recommended bond funds run by Woolnough before.
Last year M&G launched a leverage loan fund, which raised €1 billion.