Bentham Global Income Fund Wins Best Fixed Income Fund at 2024 Morningstar Awards

28 March 2024

Bentham Asset Management, a leading global fixed interest and credit specialist, is proud to share that the Bentham Global Income Fund won Best Fixed Income Fund at the 2024 Morningstar Fund Manager of the Year Awards.

This win recognises the Fund’s consistent performance, expert management, and strong risk-adjusted returns in volatile markets. As one of Australia’s longest-running global credit funds, it continues to demonstrate the value of active management.

Third Win Highlights Long-Term Success

Bentham has now won this award three times and has been a six-time finalist. These repeated honours reflect the team’s disciplined investment process and focus on delivering outcomes for investors.

Since its launch in September 2003, the Global Income Fund has delivered 6.28% p.a. after fees (as at 29 February 2024). In 2023, the Fund returned 8.08% after fees, navigating a challenging interest rate environment.

A Message from the Chief Investment Officer

Bentham’s Chief Investment Officer, Richard Quin, commented:

“We’re honoured to receive this award, especially in such a difficult fixed income environment. The last three years have tested both investors and managers. We appreciate Morningstar’s robust evaluation, which considers both qualitative and quantitative factors.”

Navigating a Volatile Market

Since March 2022, central banks have raised rates aggressively to combat inflation. US cash rates jumped from 0.25% to 5.50%, one of the fastest tightening cycles since the 1980s. In Australia, rates climbed from 0.10% to 4.35%.

This rate surge drove traditional fixed income benchmarks into negative territory. Over the three years to 31 December 2023:

  • Australian Fixed Interest* returned -2.7% p.a.
  • Global Government Bonds** returned -4.0% p.a.

Bentham took a proactive approach to manage these risks. The Global Income Fund delivered a positive return of 4.7% p.a. over the same three-year period. The team tactically adjusted interest rate exposure, moving from a short duration of -3.3 years during low-rate periods to +7.2 years by late 2023.

A Diversified, Active Strategy

The Fund invests across global fixed income and credit markets, including:

  • Corporate and government bonds
  • Senior and subordinated debt
  • Structured credit, loans, and hybrids
  • Asset-backed securities

By investing in over 600 global issuers, the Fund reduces concentration risk and captures diversified sources of return.

Outlook for 2024 and Beyond

Quin sees a more favourable environment ahead for fixed income investors:

“Yields are much more attractive now, offering a better starting point for long-term returns. We’re positioned conservatively with defensive credit exposure, extended duration, and cash to deploy as opportunities arise.”

As of February 2024, the Fund’s yield to maturity stands at 6.26%, while maintaining a prudent risk profile.

About the Awards

The Morningstar Fund Manager of the Year Awards are presented by Morningstar Australasia Pty Ltd, a subsidiary of Morningstar, Inc. (NASDAQ: MORN). The awards recognise fund managers who demonstrate long-term investment excellence and the courage to stand apart from the consensus to benefit investors.

Learn more about the Bentham Global Income Fund here.

* Bloomberg AusBond Comp 0+ Year Index
** JP Morgan GBI (AUD Hedged)