Royal London Sustainable Short Duration Corporate Bond Fund
Share class M Acc GBP
ISIN GB00BLDC8278
This fund uses the Sustainability Focus label, which is for funds that invest mainly in assets that focus on sustainability for people or the planet.
Fund objective
The Fund’s financial objective is to achieve a total return and outperform, after the deduction of charges, the ICE Bank of America Merrill Lynch Sterling Non-Gilt (1-5 Years) Total Return (GBP Unhedged) over rolling 5-year periods. The Fund’s sustainability objective is to invest in companies or issuers that make a positive contribution to one or more of the “Sustainability Themes” (Clean, Healthy, Safe, Inclusive), through their products or services as determined by the Investment Manager using its “Sustainability Standard”.
Fund ratings
| Base currency | GBP |
|---|---|
| Fund launch | 23 Nov 2022 |
| ISA eligible | Yes |
| SRRI | 3 |
| Redemption yield | 5.68% |
| IA sector |
|---|
| IA Sterling Corporate Bond |
| Benchmark |
| ICE BofA 1–5 Year Sterling Non-Gilt Index |
Performance
Data as at 31 Aug 2026
Royal London Sustainable Short Duration Corporate Bond Fund - M Acc GBP | 21.83% |
ICE BofA 1–5 Year Sterling Non-Gilt Index (Total Return, GBP) | 17.91% |
IA Sterling Corporate Bond | 18.75% |
Past performance is not a guarantee or reliable indicator of future returns. The value of investments and the income from them is not guaranteed and may go down as well as up and investors may not get back the amount originally invested.
Share class performance is based on mid-day prices, net of fees and gross of taxes, with gross income reinvested unless otherwise stated. Benchmark performance is priced at close of business, gross of fees and taxes. The impact of fees reduces your investments. Rolling performance data shown using month end returns. Quartile rank, where displayed, is the IA sector quartile rank for the M Acc GBP share class.
Cumulative
To 31 Aug 2026 | 1 month | 3 months | 6 months | 1 year | 3 years | 5 years | 10 years | Launch |
|---|---|---|---|---|---|---|---|---|
M Acc GBP | 0.16 | 0.97 | 0.73 | 4.78 | 21.83 | - | - | 25.00 |
Benchmark | 0.39 | 0.62 | 0.28 | 3.53 | 17.91 | - | - | 19.50 |
IA sector | 0.31 | -0.02 | -1.20 | 3.57 | 18.76 | - | - | - |
Quartile rank | 4 | 1 | 1 | 1 | 1 | - | - | - |
Annualised
3 years | 5 years | Launch |
|---|---|---|
6.80 | - | 6.09 |
5.64 | - | 4.84 |
5.90 | - | - |
1 | - | - |
Share class launched on 23 Nov 2022
Fund breakdowns
Top 10 holdings (%)
HSBC Bank Fund 5.844% VRN Perp | 2.39 |
UK Treasury 4.25% 07/06/2032 | 1.82 |
Bazalgette Finance Plc 2.375% 29/11/2027 | 1.50 |
M and G PLC 5.625% VRN 20/10/2051 | 1.49 |
Principality Building Society 8.625% 12/07/2028 | 1.39 |
Aviva PLC 4% 05/06/2032 | 1.29 |
Tesco Property Finance 7.6227% 13/07/2039 | 1.16 |
National Grid Electricity Dist 5.75% 16/04/2032 | 1.15 |
Virgin Money UK PLC 7.625% VRN 23/08/2029 | 1.15 |
Yorkshire Water 6.454% 28/05/2027 | 1.14 |
Total number of holdings | 231 |
Sector breakdown (%)
| Fund | Benchmark | |
|---|---|---|
Structured | 29.62 | 3.98 |
Banks & Financial Services | 19.21 | 28.77 |
Insurance | 14.03 | 5.03 |
Social Housing | 10.02 | 0.54 |
Utility | 9.67 | 4.35 |
Real Estate | 4.45 | 2.83 |
Consumer Services | 4.40 | 3.38 |
Supranationals & Agencies | 3.36 | 39.46 |
Covered | 2.04 | 0.77 |
Other | 3.20 | 10.91 |
Fund characteristics
Redemption yield | 5.68% |
Fund Duration (years) | 3.59 |
Benchmark duration (years) | 2.61 |
Redemption yield
The weighted average rate of discount at which the future obligations of interest and capital payments of each of the fund's holdings equates to its current price, gross of relevant fund management costs and gross of tax.
Sustainability
ESG characteristics rationale
The Fund’s sustainability objective is to invest in companies or issuers that make a positive contribution to one or more of the “Sustainability Themes” (Clean, Healthy, Safe, Inclusive), through their products or services as determined by the Investment Manager using its “Sustainability Standard”. The Sustainability Standard requires 50% of a company or issuer's revenues to be derived from product or services aligned to one or more of the four Sustainability themes.
Overall, at least 70% of the Fund is invested in sustainable companies or issuers. Up to 30% may be held in non-sustainable companies or Issuers that do not conflict with the sustainability objective for any of the four sustainability themes of the Fund.
Fund exclusions
Royal London Asset Management applies exclusions guidelines - detail of which can be found here.
Climate metrics | Fund | Benchmark | Difference (%) |
|---|---|---|---|
Financed emissions (tCO2e) | 1,763.64 | n/a | n/a |
Financed emissions coverage | 50.00% | n/a | n/a |
Carbon footprint (tCO2e/$M invested) | 8.93 | 8.64 | 3.28 |
Carbon footprint coverage | 50.00% | 88.93% | (43.78) |
Weighted average carbon intensity (tCO2e/$M sales) | 26.26 | 28.31 | (7.24) |
Weighted average carbon intensity coverage | 92.24% | 93.55% | (1.41) |
Total engagements by theme and topic
Climate | 11 |
|---|
Climate - Transition Risk | 9 |
Climate - Physical Risk | 2 |
Governance | 2 |
|---|
Board | 2 |
Social & Financial Inclusion | 2 |
|---|
Just transition | 2 |
Monthly commentary
Data as at 31 Aug 2026
These views represent the opinions of the author(s) at the time of writing and do not constitute investment advice.
Government bond yields broadly continued to edge higher in August. Global credit markets strengthened during the month, with stable investment grade spreads supported by good demand despite heavy technology-sector issuance. Corporate credit was a notable outperformer during the month, and high yield spreads narrowed to their lowest level over the past 12 months.
The fund saw positive returns for August and outperformed its benchmark, with relative performance primarily driven by our overweight in the structured sector, offsetting the negative impact of the fund's modest long duration stance as yields edged higher.
The all-in yield available in the sterling credit market remains attractive and, despite tighter credit spreads, continues to provide adequate compensation for default risk. Driven by our longstanding credit philosophy, we remain confident in our ability to achieve an attractive yield premium in the portfolio while delivering on the fund's sustainability objective, maintaining a high degree of diversification across both sectors and issuers, and retaining a bias towards secured debt that provides additional downside protection.
Fund managers
Shalin Shah
Senior Fund Manager
Matt Franklin
Senior Fund Manager
Fund literature
Codes and fees
Share class | ISIN | SEDOL | Launch date | Fee | Min investment |
|---|---|---|---|---|---|
M Acc GBP | GB00BLDC8278 | BLDC827 | 23/11/2022 | 0.350% | £100,000 |
M Inc GBP | GB00BLDC8B60 | BLDC8B6 | 23/11/2022 | 0.350% | £100,000 |
S Acc GBP | GB00BLDC8724 | BLDC872 | 23/11/2022 | 0.060% | £0 |
S Inc GBP | GB00BLDC8617 | BLDC861 | 23/11/2022 | 0.060% | £0 |
Z Acc GBP | GB00BLDC8948 | BLDC894 | 23/11/2022 | 0.310% | £3,000,000 |
Z Inc GBP | GB00BLDC8831 | BLDC883 | 23/11/2022 | 0.310% | £3,000,000 |
Contact us
For intermediaries
Email: bdsupport@rlam.com
For enquiries: 020 3272 5950
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Sustainable Investing
Our sustainable funds provide exposure to companies demonstrating a net benefit to society, through either the products and services they offer or ESG leadership.
Risks
Past performance is not a guide to future performance. The value of investments and any income from them may go down as well as up and is not guaranteed. Investors may not get back the amount invested.
Charges from capital risk
Charges are taken from the capital of the Fund. Whilst this increases the yield, it also has the effect of reducing the potential for capital growth.
Counterparty risk
The insolvency of any institutions providing services such as safekeeping of assets or acting as counterparty to derivatives or other instruments, may expose the Fund to financial loss.
Credit risk
Should the issuer of a fixed income security become unable to make income or capital payments, or their rating is downgraded, the value of that investment will fall. Fixed income securities that have a lower credit rating can pay a higher level of income and have an increased risk of default.
EPM techniques risk
The Fund may engage in Efficient Portfolio Management (EPM) techniques, including holdings of derivative instruments. Whilst intended to reduce risk, the use of these instruments may expose the Fund to increased price volatility.
Interest rate risk
Fixed interest securities are particularly affected by trends in interest rates and inflation. If interest rates go up, the value of capital may fall, and vice versa. Inflation will also decrease the real value of capital. Unlike the income from a single fixed interest security, the level of income (yield) from a fund is not fixed and may go up and down. Bond yields (and as a consequence bond prices) are determined by market perception as to the appropriate level of yields given the economic background.
Liquidity risk
In difficult market conditions the value of certain fund investments may be difficult to value and harder to sell, or sell at a fair price, resulting in unpredictable falls in the value of your holding.
Responsible investment risk
The Fund can only invest in holdings that demonstrate compliance with certain sustainable indicators or ESG characteristics. This reduces the number of securities in which the Fund can invest and there may as a result be occasions where it forgoes more strongly performing investment opportunities, potentially underperforming non-sustainable funds.
Important information
This is a financial promotion and is not investment advice.
Issued by Royal London Asset Management Limited, 80 Fenchurch Street, London EC3M 4BY. Authorised and regulated by the Financial Conduct Authority, firm reference number 141665. A subsidiary of The Royal London Mutual Insurance Society Limited.
The Fund is a sub-fund of Royal London Bond Funds II ICVC, an open-ended investment company with variable capital with segregated liability between sub-funds, incorporated in England and Wales under registered number IC001128.
The Authorised Corporate Director (ACD) is Royal London Unit Trust Managers Limited, authorised and regulated by the Financial Conduct Authority, with firm reference number 144037.
For more information on the fund or the risks of investing, please refer to the Prospectus or Key Investor Information Document (KIID).
ICE indexes and data are the intellectual property of ICE Data Indices, LLC, its affiliates (“ICE Data”) and/or its Third-Party Suppliers and has been licensed for use by Royal London Asset Management. ICE Data and its Third-Party Suppliers accept no liability in connection with its use. See www.theice.com/market-data/disclaimer for a full copy of the Disclaimer.
Source: Royal London Asset Management unless otherwise stated.
