January 24, 2019 / Product launch

Sky Harbor launches high yield bond fund

By Joe McGrath, ESG Clarity

There is alpha to be found by screening companies on their ESG credentials, says the company's head of investing

Sky Harbor launches high yield bond fund

Sky Harbor Capital Management has launched a short maturity ESG US high yield strategy and Ucits fund.

The launch follows increasing demand for sustainability-focused fixed income, values-based investment opportunities, the company said in a media statement.

Managed by Sky Harbor’s head of investing, David Kinseley, the Short Maturity Sustainable High Yield Bond Fund will be weighted towards companies that exhibit the highest levels of relative sustainability reporting, community engagement and disclosure of ESG indicators.

While the main focus for the fund will be on current income, preservation of principle and low volatility, attention will be paid to values-based ESG factors aimed at minimising environmental degradation and controversial activities, and promoting diversity, transparency and sustainability leadership.

The fund excludes fossil fuels as well as munitions, tobacco, alcohol, adult entertainment and gambling sectors.

“We fundamentally believe that more responsible companies will produce better return outcomes and lead to alpha generation over time,” Kinsley said.

“This strategy is benchmarked to the ICE BofAML 1-5 Yr BB-B Cash Pay High Yield Constrained Index (“JVC4”) to allow investors to assess the long-term impact of their values-based investing. We don’t think they need to give up investment performance to ‘do good’,” he added.

The fund is a natural extension of Sky Harbor’s existing short duration strategy which has been managed by the Group’s co-founder, Anne Yobage, since 1992.