SKY Harbor Capital Management, a women-led independent investment manager, has launched a short maturity ESG US high yield strategy and UCITS fund to meet the growing demand for sustainability-focused fixed income, values-based investment opportunities.
SKY Harbor Global Funds – Short Maturity Sustainable High Yield Bond Fund is constructed with a focus on current income, preservation of principal and low volatility, as well as attention to values-based ESG factors aimed at minimising environmental degradation and controversial activities, and promoting diversity, transparency and sustainability leadership. Aligned with European Sustainable Investment Forum aspirations, the Fund excludes fossil fuels as well as munitions, tobacco, alcohol, adult entertainment and gambling sectors.
The fund is managed by SKY Harbor’s Head of Investing, David Kinsley (pictured), and holdings will be weighted towards companies that exhibit the highest levels of relative sustainability reporting, community engagement and disclosure of ESG indicators. Engagement will be an important theme, and SKY Harbor will seek to improve transparency and ESG-related reporting by working with high yield companies that score lower against its bespoke sustainability KPIs.
Kinsley says: “We fundamentally believe that more responsible companies will produce better return outcomes and lead to alpha generation over time. This strategy is benchmarked to the ICE BofAML 1-5 Yr BB-B Cash Pay High Yield Constrained Index (“JVC4”) to allow investors to assess the long-term impact of their values-based investing. We don’t think they need to give up investment performance to ‘do good’.”
SKY Harbor believes this strategy also affords investors the opportunity to benefit from its long history of investing in the short end of the high yield credit curve. The SKY Harbor team has more than 30 years’ experience in the US high yield bond market and is led by founders Hannah Strasser and Anne Yobage, who pioneered short duration investing in 1992 and became recognised leaders in the asset class while at AXA Investment Managers. The new fund is a natural extension of SKY Harbor’s short duration strategy which has been managed by Anne Yobage since 1992. SKY Harbor believes this strategy is well positioned at this point in the investment cycle given the return of volatility and rising interest rate environment.
The Short Maturity Sustainable High Yield Bond Fund is also a reflection of SKY Harbor’s longstanding commitment to responsible high yield investing, evidenced in its robust investment process and involvement in collaborative network-based initiatives. The firm is a signatory of the Principles for Responsible Investment (PRI) and a participant in the Thirty Per cent Coalition and UN Global Compact.