Abrdn has relaunched two of its fixed income funds with an unconstrained approach due to the investment manager’s opinion that inflation volatility is “here to stay."

Today the investment manager relaunched the funds within its unconstrained, diversified fixed income range.

Its Absolute Return Global Bond Strategies Fund will become the Macro Fixed Income Fund, while The Total Return Credit fund is to become the Global Income Bond fund.

These Abrdn SICAV II funds, available for wholesale, retail and institutional investors, will target less correlated returns and lower drawdowns than traditional fixed income funds. 

They will use strategies which the investment manager believes are difficult to replicate elsewhere, with the aim to help clients grow and preserve their wealth.  They are distinct from traditional fixed income funds which are managed relative to a benchmark index.

The investment manager said that investors need more diversification strategies as it expects continued inflation volatility, frequent changes to central bank policy and unpredictable bond markets.

Ginny Richardson, global head of commercial strategy, fixed income, at Abrdn said: "We are excited about the prospects for both of these re-launched products and indeed to continue to build momentum behind our range of outcome orientated fixed income strategies.”

The investment manager has also made changes to the processes for both funds.

The Macro Fixed Income Fund will have a new investment process to better align with key goals: diversified returns and low drawdowns. Using a diversified macro approach with strong risk controls.  It will also have a new philosophy: diversified; highly liquid with simple strategies; and resilient. 

The fund currently has assets under management of over $500m (£394.6m).

The Global Income Bond Fund sees the re-launch of the same strategy seen since October 2014 but with less exposure to bonds with a low credit rating within high yield with an enhanced focus on “BBB” and “BB” rated parts of the market in both developed and emerging markets.

The fund will also see simplified process by removing some of the more complex aspects of our defensive strategies and making more extensive use of credit derivatives to both enhance yield as well as to reduce risk depending on the environment.

The third fund in the range, Short Dates Enhanced Income Fund, will continue with no changes.