M&G launches two-year fixed maturity bond strategy providing opportunity for European investors to lock in attractive yields in global credit

Launch follows €440 million fixed maturity bond strategy closed in November 2023

London, 29 February 2024 – M&G’s €144 billion AUM¹ Fixed Income investment division is launching a two-year fixed maturity bond strategy aiming to lock in 4.5 percent gross annualised returns. The M&G (Lux) Fixed Maturity Bond Fund 1 seeks to provide European investors a pick-up to European sovereign bonds and cash deposits, the latter which currently yield between 3.1 percent and 3.4 percent for similar tenures.²

The global, highly diversified credit portfolio, with an allocation of at least 80 percent of investment grade and 20 percent of high yield bonds, has been designed to capture the opportunity in short-dated bonds created by the inversion of the interest rate curve. The strategy will be managed by Stefan Isaacs, co-Deputy CIO of M&G’s Fixed Income Team and Fund Manager Matthew Russell, both have over 20 years of industry experience, and will be supported by M&G’s dedicated in-house fixed income research team.

Commenting on the launch, Stefan Isaacs said: “With European headline inflation tracking down towards the 2 percent target and the European Central Bank expected to start cutting interest rates later this year, the current environment provides investors with the opportunity to lock in higher rates through fixed maturity bond strategies that are backed by strong research analysis. The ongoing inversion of the interest rate curve allows us to find compelling yields for Investment Grade bonds and High Yield credit across markets while limiting duration risk.”

Neal Brooks, M&G’s Global Head of Product and Distribution, added: “We are seeing strong interest from our European clients in fixed maturity strategies ahead of Central Banks making their next move. M&G’s active approach to fixed income investment is valued by our clients as credit selection is key as companies refinance at this stage in the interest rate cycle. Today’s launch responds to this demand and follows the successful Fixed Maturity Bond strategy, which raised €440 million during its six week subscription period that closed in November 2023.”

The fund is Article 8 under SFDR and will be available for subscription until October 16, 2024.

Download a PDF of the release

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Eva Martin

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Key Features of the M&G (Lux) Fixed Maturity Bond Fund 1

Fund domicile: Luxembourg
Fund currency: EUR
Initial Offering Period (IOP): February 28 – April 12
Launch date: 16 April
Subscription period: ending on October 16
Maturity: 2 years
Investment policy: The Fund invests at least 80% of its Net Asset Value in investment grade debt securities. These securities can be issued or guaranteed by governments and public issuers, and companies. Issuers can be located anywhere in the world, including emerging markets. These securities can be denominated in any currency. The Fund may invest up to 20% in below investment grade and unrated debt securities.
Recommended holding period: 2 years
Target gross yield (per annum)³: 4.5%
Average rating⁴: BBB

Further details on the fund's main risks (market risk, credit risk, interest rate risk and below investment grade debt risk) can be found in the fund's Prospectus. An explanation of the terms used in this document can be found on the glossary on our website.

Notes to Editors

¹ Source: M&G, Public Debt AUM as of 30 June 2023.
²Source: European Central Bank, data portal, Dec 2023, Euro area provisional values for deposits with agreed maturity over 1 and up to 2 years and over 2 years.
³Based on current market conditions, target returns are not guaranteed.
⁴ Internal limits only. Subject to change

OpenAbout Stefan Isaacs

Stefan is co-Deputy CIO of Fixed Income and Head of M&G’s Macro Credit business. He joined M&G as a graduate in 2001 and was subsequently promoted to corporate bond dealer specialising in high yield bonds and euro-denominated credit. He was appointed fund manager of the M&G European corporate bond strategy in April 2007 and co-fund manager of the Optimal Income strategies since their inception in 2007. He is also lead fund manager on the Global High Yield Bond Strategy and is co-fund manager on the Global Floating Rate High Yield and Sustainable Optimal Income strategies. Since 2010, he has managed a number of high yield and high yield ESG strategies in London and in Luxembourg. Stefan graduated BA (hons) International Business from Manchester Metropolitan University.

OpenAbout Matthew Russell

Matthew joined M&G in 2007 as a fund manager’s assistant covering fixed income funds. He became co-manager of the Short Dated Corporate Bond strategy in 2011 and, two years later, was appointed lead fund manager. In 2015 he started managing the Gilt & Fixed Interest Income strategy and in June 2021 became lead fund manager of the European Inflation Linked Corporate Bond strategy and co-fund manager of the UK Inflation Linked Corporate Bond strategy. In 2024, he took on management of the European Investment Grade Strategies. Matthew has a BSc in economics from the University of Birmingham and is also a CFA charterholder.

OpenAbout M&G Investments

M&G Investments is part of M&G plc, a savings and investment business which was formed in 2017 through the merger of Prudential plc’s UK and Europe savings and insurance operation and M&G, its wholly owned international investment manager. M&G plc listed as an independent company on the London Stock Exchange in October 2019 and has €387.8 billion of assets under management (as at 30 June 2023). M&G plc has customers in the UK, Europe, the Americas and Asia, including individual savers and investors, life insurance policy holders and pension scheme members. For nearly nine decades M&G Investments has been helping its customers to prosper by putting investments to work, which in turn creates jobs, homes and vital infrastructure in the real economy. Its investment solutions span equities, fixed income, multi asset, cash, private debt, infrastructure and real estate. M&G recognises the importance of responsible investing and is a signatory to the United Nations Principles for Responsible Investment (UNPRI) and is a member of the Climate Bonds Initiative Partners Programme. M&G plc has committed to achieve net zero carbon emissions on its total book of assets under management and administration by 2050 and committed to reduce operational carbon emissions as a corporate entity to net zero by 2030.

For more information, please visit: www.mandg.com

This information is intended for journalists and media professionals only. It should not be relied upon by private investors or advisers. Issued by M&G Luxembourg S.A. (Registered office: 16, boulevard Royal, L2449, Luxembourg).

In Spain the M&G Investment Funds are registered for public distribution under Art. 15 of Act 35/2003 on Collective Investment Schemes as follows: M&G (Lux) Investment Funds 1 reg. no 1551. The collective investment schemes referred to in this document (the "Schemes") are open-ended investment companies with variable capital, incorporated in Luxembourg.

This information is not an offer or solicitation of an offer for the purchase of investment shares in one of the funds referred to herein. Purchases of a fund should be based on the current Prospectus. The Instrument of Incorporation, Prospectus, Key Information Document, annual or interim Investment Report and Financial Statements, are available in English or your local language (unless specified below) free of charge, in paper form, from M&G Luxembourg S.A. or one of the following – M&G Luxembourg S.A., German branch, mainBuilding, Taunusanlage 19, 60325 Frankfurt am Main; Allfunds Bank, Calle Estafeta, No 6 Complejo Plaza de la Fuente, La Moraleja, 28109, Alcobendas, Madrid, Spain; M&G Luxembourg S.A. French branch, 8 rue Lamennais, Paris 75008; from the French centralising agent of the fund: RBC Investors Services Bank France; For Germany, copies of the Instrument of incorporation, annual or interim Investment Report, Financial Statements and Prospectus are available in English and the Prospectus and Key Information Document/s are available in German.

Before subscribing investors should read the Key Information Document and the Prospectus, which includes a description of the investment risks relating to these funds. The value of the assets managed by the funds may greatly fluctuate as a result of the investment policy. The information contained herein is not a substitute for independent investment advice.

M&G Luxembourg S.A. may terminate arrangements for marketing under the new Cross-Border Distribution Directive denotification process.

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M&G plcの直接子会社であるM&G Investments（M&Gインベストメント）のウェブサイトにアクセスするには、
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If you are looking for the affiliates of Prudential Financial, Inc., whose principal place of business is in the United States of America, click here to proceed.

アメリカ合衆国を主たる事業領域とするPrudential Financial, Inc.（プルデンシャル・ファイナンシャルInc.）の関連会社をお探しの場合は、こちらをクリックしてください。

If you are looking for the affiliates of Prudential plc, an international group incorporated in England and Wales, click here to proceed.

イングランド及びウェールズで設立された国際グループ企業であるPrudential plc（プルデンシャル・ピーエルシー）の関連会社をお探しの場合は、こちらをクリックしてください。

M&G plc, incorporated and registered in England and Wales. Registered office: 10 Fenchurch Avenue, London EC3M 5AG. Registered number 11444019. M&G plc is a holding company, some of whose subsidiaries are authorised and regulated, as applicable, by the Prudential Regulation Authority and the Financial Conduct Authority.

M&G plc is a company incorporated and with its principal place of business in England, and its affiliated companies constitute a leading savings and investments business. M&G plc is the direct parent company of The Prudential Assurance Company Limited. The Prudential Assurance Company Limited is not affiliated in any manner with Prudential Financial, Inc, a company whose principal place of business is in the United States of America or Prudential plc, an international group incorporated in England and Wales.

M&G plc は、イングランド及びウェールズで設立・登録。本社登録地は10 Fenchurch Avenue, London EC3M 5AG。登録番号11444019。M&G plcは持ち株会社で、その子会社の一部はPRA（健全性監督機構）及びFCA（金融行為規制機構）に認可され、それらの規制対象となっています。

M&G plc は、イングランドを登録地、及び主たる事業領域とする会社で、その関連会社は有数の貯蓄・投資機関として基盤を確立しています。M&G plcは、Prudential Assurance Company Limited（プルデンシャル・アシュアランス・カンパニー・リミテッド）の直接親会社です。なお、Prudential Assurance Company Limitedは、アメリカ合衆国を主たる事業領域とするPrudential Financial, Inc.（プルデンシャル・ファイナンシャルInc.）またはイングランド及びウェールズで設立された国際グループ企業であるPrudential plc（プルデンシャル・ピーエルシー）とは一切関係がありません。