M&G (Lux) Global Target Return Fund


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Objective and investment policy


The fund aims to provide a combination of capital growth and income of at least 3-month Euribor plus 4% a year, before any Ongoing Charges over any three-year period. The 3-month Euribor is the rate at which banks borrow money from each other. The fund aims to achieve this while seeking to limit losses and minimise the degree to which the value of its assets changes over time. Managing the fund in this way reduces its ability to achieve returns significantly above three-month EURIBOR plus 4%.

Investment policy and strategy

Core investment: The fund typically invests via derivatives in a mix of assets from anywhere in the world, including company shares, bonds, currencies, cash and assets that can be turned quickly into cash. The fund may also invest directly, or through other funds. The fund may invest in Chinese bonds denominated in Renminbi.

Other investments: The fund may invest in asset-backed securities, contingent convertible debt securities, other funds and cash or assets that can be turned into cash quickly.

Derivatives: The fund invests via derivatives and may use derivatives with the aim of reducing the risks and costs of managing the fund.

Strategy in brief: The fund has a highly flexible investment approach, with the freedom to invest in different types of assets from anywhere in the world. The approach combines in-depth research to work out the ‘fair’ value of assets over the medium to long term, with analysis of market reactions to events to identify investment opportunities. The blend of assets held in the fund is regularly adjusted depending on where the investment manager sees the most value, and to manage risks in order to limit losses. The investment manager looks to manage risk by combining different assets which are affected by market conditions in different ways, and by employing derivatives strategies to help protect or profit from falling markets.

Where the investment manager believes it appropriate, the fund may hold a high level of cash.

Performance comparator: The fund is actively managed. The 3-month Euribor plus 4% is a point of reference against which the performance of the fund is measured.

Risk indicator

Risk level 4

Risks associated with the fund

The value and income from the fund's assets will go down as well as up. This will cause the value of your investment to fall as well as rise. There is no guarantee that the fund will achieve its objective and you may get back less than you originally invested.

The fund may use derivatives to profit from an expected rise or fall in the value of an asset. Should the asset's value vary in an unexpected way, the fund may lose as much as or more than the amount invested.

The fund is exposed to different currencies. Derivatives are used to minimise, but may not always eliminate, the impact of movements in currency exchange rates.

Investments in bonds are affected by interest rates, inflation and credit ratings. It is possible that bond issuers will not pay interest or return the capital. All of these events can reduce the value of bonds held by the fund.

Investing in emerging markets involves a greater risk of loss due to greater political, tax, economic, foreign exchange, liquidity and regulatory risks, among other factors. There may be difficulties in buying, selling, safekeeping or valuing investments in such countries.

The fund may invest in China A shares. Investments in assets from the People's Republic of China are subject to changeable political, regulatory and economic conditions, which may cause difficulties when selling or collecting income from these investments. In addition, such investment is made via the 'Stock Connects' systems, which may be more susceptible to clearing, settlement and counterparty risk. These factors could cause the fund to incur a loss.

Investing in bonds from China, denominated in Renminbi and traded on the China Interbank Bond Market, may be subject to greater clearing, settlement and counterparty risk. These factors could cause the fund to incur a loss.

In exceptional circumstances where assets cannot be fairly valued, or have to be sold at a large discount to raise cash, we may temporarily suspend the fund in the best interest of all investors.

The fund could lose money if a counterparty with which it does business becomes unwilling or unable to repay money owed to the fund.

Further details of the risks that apply to the fund can be found in the fund's Prospectus.

Other information

The Fund allows for the extensive use of derivatives.

Fund Team

Tristan Hanson - Fund manager

Tristan Hanson was appointed fund manager of the M&G Global Target Return Fund upon its launch in December 2016. Tristan has over 15 years of experience in asset management and joined M&G in April 2016 from Ashburton Investments, where he started in 2008 and was appointed Head of Asset Allocation with responsibility for global multi-asset funds in 2010. Prior to this, Tristan worked as a Strategist at JP Morgan Cazenove from 1999 to 2006, covering equities, fixed income and currencies.

Tristan holds a Master in Public Administration in International Development from Harvard University’s Kennedy School of Government and a BA (Hons) in Economics from Durham University. He is a Chartered Fellow of the CISI.

 Team member biography
Craig Simpson

Craig Simpson - Deputy Manager

Craig Simpson was appointed co-deputy fund manager of the M&G Global Target Return Fund from launch in December 2016. He joined M&G in 2004 as a portfolio manager and is a member of the Multi Asset team, with over 15 years’ experience in the investment industry. In February 2015, he was appointed Head of Portfolio Management for the Multi Asset team. Prior to joining M&G, Craig was a trainee fund manager at Equitable Life Assurance and an analyst at Pictet Asset Management. He graduated from the University of Aberdeen with a degree in land economics.

 Team member biography
Eric Lonergan

Eric Lonergan - Deputy Manager

Eric Lonergan joined M&G in 2006 as a member of its Multi Asset team. Together with Dave Fishwick, he manages the M&G (Lux) Episode Macro Fund and is also co-manager of the M&G Episode Growth Fund (a UK-authorised OEIC), as well as co-deputy manager of the M&G (Lux) Global Target Return Fund. Prior to joining M&G, Eric was managing director and head of macro research at JP Morgan Cazenove. He has a BA in politics, philosophy and economics from Pembroke College, Oxford, and an MSc in economics from the London School of Economics.

 Team member biography
Christophe Machu

Christophe Machu - Investment specialist

Christophe Machu joined the Multi Asset and Convertibles teams as an associate investment specialist providing support for M&G's multi-asset fund range and the M&G Global Convertibles Fund in September 2014. He initially joined M&G in 2012 as a sales support in Paris before moving into the International Marketing team in London. Christophe has an MSc in risk and finance from EDHEC Business School.

 Team member biography