Franklin Templeton Investments today launched a Euro short duration bond fund that will invest in short-dated fixed and floating-rate debt securities and debt obligations of investment grade corporate and sovereign issuers located within the Eurozone.
The fund will have some flexibility to invest outside the Eurozone, and across sectors, according to a company press release. It may also purchase securitized debt and certain financial derivative instruments including index-based financial derivatives, credit default swaps and currency forwards.
London-based David Zahn, head of European fixed income and lead portfolio manager; and Rod MacPhee, research analyst and portfolio manager in the fixed income group, will manage the fund.
“We believe it is an opportune time to launch this Fund as European short duration securities provide portfolio insulation and opportunity for enhanced return in rising rate environments,” said Zahn in the press release. “We find that European short duration fixed income is a growing sector as investors are continuing to seek yield with some level of protection from interest rate risk.”
Franklin Templeton’s fixed income group has over $397 billion under management.