Oddo to close convertible bond fund after investor surge

French multi-specialist Oddo Asset Management is to close its European blend bond fund Oddo Rendement 2017 at the end of March after a surge of interest from investors.

The fund, which invests in a combination of convertibles and regular bonds with maturities no longer than December 2017, has garnered almost €450 million in assets since it was launched at the end of September last year.

It is managed by Citywire AA-rated Xavier Hoche, the firm’s head of convertibles, and his colleague Muriel Blanchier who use a strategy which fuses a mix of convertibles and ‘cross-over’ bonds’ -  BBB to B rated bonds – as well as non-rated corporate bonds (around 25% of portfolio).

Speaking to Citywire Global, the firm’s head of international sales Bertrand Levavasseur said:

‘The initial closure was planned for the end of January and was then extended to the end of March and in the last couple of months there has been a big acceleration in investor interest. We have been pleasantly surprised by the collect and the success of the fund.’

The fund currently has a yield of 6.3% and its biggest country allocation is to France (35%). Its next biggest exposure is to Portugal (11%) while Germany, Spain and Italy each make up 10% of the portfolio.

Among the sectors Hoche and Blanchier are favouring in their 110 holding-strong portfolio the cyclical consumer sector comes out top, accounting for 22% of the fund’s assets, with the technology, media and telecoms (TMT) sector following closely with 20%.