Fund Objective

The Standard Life Investments Ethical Corporate Bond Fund aims to provide a level of income, before charges, above that available on UK Government bonds by investing predominantly in investment grade bonds.

View on Past Performance

The Ethical Corporate Bond Fund returned -0.12% during November, ahead of its IMA sector average return of -0.17%. Our exposure to financial sector had a negative impact on performance during the month as investors remained wary of further bad news related to the problems in the sub-prime sector.In addition, our underweight position in medium dated bonds also hurt performance. However, this was offset by our overweight position in AAA rated issues and our holdings in supranational bonds.

Future Expectations

Central banks for the most part are looking through resource related inflation concerns, such as higher oil prices, and concentrating on alleviating current financial conditions.However, while there are some signals that pension funds are increasingly looking to take advantage of the attractive pricing of corporate bonds, there are still concerns over the level of liquidity available in the market.In addition, should further bad news emerge in the form of a US recession, rises in default rates or further revelations of exposures to structured credit, investors are likely to retain their preference for higher quality issues.

Fund Details