Rathbone High Quality Bond Fund

Lower-risk income from companies with strong credit

document downloads

For additional fund documents and share classes visit our literature library

Why invest in the High Quality Bond Fund?

  • A defensive bond fund taking limited credit risk and interest rate risk
  • At least 80% of the portfolio has a credit rating of at least A- or above – the very best of investment grade
  • Aims to keep its sensitivity to interest rate changes low
  • Targets a return of Bank of England’s benchmark interest rate + 0.5%

Fund Overview

We buy predominantly sterling bonds with very strong credit ratings issued by companies, the UK government and non-governmental organisations. At least 80% of our portfolio must be in bonds with a credit rating of A- or higher, which is four grading notches above high-yield.

While we can buy bonds with longer maturities, we aim to keep our overall portfolio’s duration, or sensitivity to interest rates, below five years. 

When picking our investments, there are three assessments we make. First, we look at the economic environment to determine which industries we want to own and the duration of our investments. Then we use the Four C approach to evaluate creditworthiness.

We assess:

  • Character: Whether a company's managers have integrity and competence
  • Capacity: Ensuring a company isn't over-borrowing and has the cash to pay its debts
  • Collateral: Are there assets backing the loan, which reduces the risk of a loan
  • Covenants: These loan agreements set out the terms of the bond and restrictions on the company

Finally, we compare prices to determine the best value bonds to include in our fund. We aim to preserve capital and deliver a return higher than the Bank of England's benchmark interest rate + 0.5%, after fees, over any rolling three-year period. We use this target because we aim to provide a return in excess of what you would receive in a UK savings account. This is an investment product, not a cash savings account. Your capital is at risk.

Click here for the latest assessment of our performance.

Fund details

Fund Overview
Costs and charges

MiFID II charges

I class

Ongoing charges figure (OCF) as at 30.04.2022
Inc: 0.40%/Acc: 0.40%

Transaction costs
Inc: 0.08%/Acc: 0.08%

Total MiFID II charges
Inc: 0.48%/Acc: 0.48%

The MiFID II charges include the Ongoing Charges Figure (OCF) and transaction costs.

Prices and dividends

In Conversation September 2023

Manager James Thomson discusses portfolio strategy in ‘kangaroo’ market whose dizzying bounces are making investors nervous. He explains why he believes the US is still the place to be when growth is hard to find and runs through some of the stocks he’s been buying and selling recently.  

In the KNOW


Meet the team