Zurich Life Long Bond

The Long Bond Fund mainly invests in longer-dated bonds with more than ten years to maturity, primarily issued by eurozone governments. It may also hold supranational bonds, other investment-grade corporate and non-sovereign bonds, and bond-based financial instruments. In practice, the fund is focused on eurozone fixed interest markets and may also hold cash.

The Long Bond Fund is designed for investors seeking growth through exposure to long-dated eurozone bonds. Because it is actively managed by Zurich Life, the managers can adjust holdings within the fund’s bond universe rather than simply tracking an index. It may appeal to investors who want a concentrated government-bond strategy with some flexibility to add other high-quality bond exposures.

The Long Bond Fund must keep its minimum duration at no less than 75% of its investment universe. Duration is a measure of how sensitive a bond portfolio is to changes in interest rates; in simple terms, longer-duration portfolios usually rise or fall more when rates move. This means the fund is likely to be relatively sensitive to interest-rate changes because it focuses on longer-dated bonds.

The Long Bond Fund is focused on the eurozone and its geographic allocation includes France, Italy, Germany, Spain, Ireland, Portugal, Belgium and Greece, as well as cash. Its main exposure is to eurozone government fixed interest securities, so the fund is concentrated in European sovereign bond markets. This concentration means the fund’s returns may be influenced by developments in those individual countries and the wider eurozone bond market.

The Long Bond Fund’s long-dated bond focus means it may be sensitive to interest-rate movements, which can push bond prices up or down. It also has eurozone concentration, so changes in the region’s government bond markets can have a strong effect on performance. Because it may also invest in corporate, supranational and other bond instruments, investors should be aware that different bond issuers can bring different levels of credit risk; credit risk means the issuer could be less able to make payments than expected.