October 2009

As we continue to bring together the strategic approach to the BT and Advance multi-manager funds, the recent recovery in credit markets has provided the opportunity to align the overall fixed interest exposure with the Advance model.

We’ve reduced the credit exposure within the BT Fixed Interest Multi-manager Fund through staged transactions – given the recent recovery within credit markets – and introduced an investment in the Advance International Fixed Interest Multi-Blend Fund.

As economies and investment markets gradually improve, we believe that the current Advance international fixed interest managers – Franklin Templeton and Standish Mellon – are better placed to capitalise on investment opportunities in both traditional and emerging markets.

Franklin Templeton is one of the world’s largest and most experienced fixed income managers, with robust investment processes and a strong record in global fixed interest management. Its philosophy combines top-down analysis with bottom-up quantitative tools to identify the most attractive investment opportunities. By taking diverse, low-correlated positions the manager minimises the risk of underperformance.

Standish Mellon’s disciplined investment process has a strong emphasis on risk control and focuses on bottom-up, fundamental research and analysis by a dedicated team of sector strategists. They seek to add value through active sector strategies.

Both managers are able to adapt to changing market conditions by adjusting weightings between sovereign, credit and other sub-sectors to enhance performance.

What’s next?

We’ll continue to make strategic changes to the BT Multi-manager investment options when market conditions are appropriate, so keep an eye out for further updates.