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M&G Optimal Income Fund can spice up income portfolios

18 November 2009 / by Rebecca Sargent

The M&G Optimal Income Fund could add spice to the portfolios of those looking for additional income, Andy Parsons, advice team manager at The Share Centre has claimed.

This week's Fund in Focus at The Share Centre, the M&G Optimal Income Fund, "Is one of the most unconstrained bond funds available on the market," Mr Parsons claims, adding:

"M&G has long been respected as having a proven track record for delivering quality income funds and this fund is no exception, currently rated as 'AAA' by S&P and 'AA' by OBSR."

The fund was launched in December 2006 and the fund manager Richard Woolnough has the freedom to invest across the whole fixed interest spectrum. As a result the fund is unconstrained, in that it lets Mr Woolnough invest as much as 100 per cent in Gilt or High Yield debt, although equity exposure is capped to a maximum of 20 per cent and non-sterling currency exposure is also limited to a maximum of 20 per cent.

Commenting, Mr Parsons adds: "Given the increasing demands of investors to seek income, Woolnough uses various instruments available to him to ensure that investors benefit from total return.

"The fund's flexibility means he can make money not just when interest rates are coming down, but also when interest rates go up."

The M&G Optimal Income Fund aims to outperform its sector over the medium to long term and provides a total return to investors based on exposure to optimal income streams in investment markets.

"The fund is suitable for an investor looking to add additional spice to their income portfolio and who wishes to do so through the investment experience and knowledge of a well respected fund manager and fund house," Mr Parsons concludes.

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