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Manulife Global Fund – Preferred Securities Income Fund​

Regular income from a unique asset class1

What are preferred securities?

Learn more

Attractive yields from a unique asset class

Learn more

Fund information

Learn more

What are preferred securities?​

 

Preferred securities are a hybrid of bonds and equities, with features from both asset classes. Preferred securities typically rank between senior debt and common equity in the capital structure of a corporation. 

Attractive yields from a unique asset class

 

Quality issuers & low default rates2

With an average investment grade credit rating of BBB- and about 90% of issuers being rated as investment grade, preferred securities are relatively high quality assets, and well-positioned to help buffer an economic slowdown. Preferred securities have also historically experienced fewer defaults compared to high yield bonds. 

Yields are getting attractive

With increasing market volatility and lifting inflation, investors are seeking for stable and higher income assets. Preferred securities can offer a combination of attractive yield characteristics, inflation-hedging potential and interest rate risk mitigation versus other investment grade fixed income sectors.  

 

Yields of major US fixed income sectors3

Strong rebound after drawdowns

Like other asset classes, preferred securities experienced market drawdowns, including sell-offs in 2008 (GFC), 2011 (Euro crisis), 2013 (Fed tapering), 2016 (oil price decline), 2018 (Fed interest rate hiking) and 2020 (COVID-19 pandemic). With similar average drawdowns to other asset classes, preferred securities have been able to rebound strongly and also have a relatively shorter recovery period on average. 

 

Historical performance of preferred securities4

Fund information​

Share Class Class AA (SGD Hedged) MDIST (G) Class AA (USD) MDIST (G) Class AA (AUD Hedged) MDIST (G)
Investment objective The Fund aims to provide income generation with potential long term capital appreciation by investing primarily in preferred securities.
Inception date 11 Sep 2018
ISIN code LU1850216372 LU1813986715 LU1813986806
Bloomberg ticker MLPIASM LX MLPIAUM LX MLPIAAM LX
Base currency USD
Mode of subscription Cash and SRS Cash Cash
Minimum investment USD 1,000 (or the equivalent in any other major currency) USD 1,000 (or the equivalent in any other major currency) USD 1,000 (or the equivalent in any other major currency)
Distribution frequency1 Monthly
Management fee 1.10% p.a.
Initial sales charge Up to 5.0%
Dealing frequency Daily
Investment manager Manulife Investment Management (US) LLC
Fund size USD 305.6 million (as of 31 May 2024)

 

Portfolio managers

Joseph H. Bozoyan, CFA, is a portfolio manager in the Preferred Income Management Team at Manulife Investment Management. He was previously a managing director and senior investment analyst in Manulife’s Intrinsic Value Team, providing dedicated research for all strategies managed by that team. Prior to joining the company, Joe was a senior equity analyst in small, SMID and all cap portfolios at Ironwood Investment Management. Earlier in his career, he held analyst roles at companies such as Evergreen Investments, RCM and Sun Life. He is a CFA charterholder and a member of the CFA Society Boston, Inc.​

Bradley Lutz, CFA, is a managing director and portfolio manager in the Preferred Income Team at Manulife Investment Management. Brad is also a senior investment analyst, supporting the company’s fixed income strategies. He provides expertise in the power & utility, aerospace & defense, and industrial sectors. Most recently, he was responsible for the same duties at Declaration Management & Research, an affiliate of Manulife. Earlier in his career, he worked for Summit Investment Partners in Cincinnati, Ohio, with research, trading and portfolio management responsibilities for high yield and investment grade corporate bonds. Before Summit, Brad was with Pacholder Associates, Inc. as a high yield credit analyst. Brad is a CFA charterholder.​

Notes:

1. The intention of Manulife Global Fund to make the monthly distribution and the distribution yield for the Fund is not guaranteed, and Manulife Global Fund may in future review the distribution policy depending on prevailing market conditions. The Fund invests mainly in preferred securities.​ 

2. (LHS chart) Source: Manulife Investment Management, Bloomberg, as of 31 Mar 2024. Preferred securities are represented by ICE BofA US All Capital Securities Index. Due to rounding, the total may not be equal to 100%. Credit ratings are provided by either S&P Global Ratings, Moody’s or Fitch, which is higher. (RHS chart) Global high yield bonds are represented by ICE BofA Global High Yield Index; preferred securities by ICE BofA US All Capital Securities Index. Default rates for global high yield bonds are sourced from BofA Securities, as of 31 Mar 2024. Default rates for preferred securities are calculated by Manulife Investment Management, based on ICE BofA US All Capital Securities Index as of 31 Dec 2023. Calculated annually. Past performance is not indicative of future performance.

3. Source: Bloomberg, as of 31 Mar 2024. Index ratings refer to Bloomberg composite rating. US HY corp bonds are represented by ICE BofA US High Yield Index; US BB HY corp bonds by ICE BofA BB US High Yield Index; preferred securities by ICE BofA US All Capital Securities Index; US BBB corp bonds by ICE BofA US corp BBB Index; US IG corp bonds by ICE BofA US Corporate Index; US MBS by ICE BofA US MBS Index; US Treasuries by ICE BofA US Treasury & Agency Index. The above yields do not represent the distribution yield of the Fund and are not an accurate reflection the actual return that an investor will receive in all cases. A positive distribution yield does not imply a positive return. For illustrative purposes only. Past performance is not indicative of future performance. 

4. Source: Manulife Investment Management, Morningstar, Bloomberg, monthly performance, as of 31 Dec 2023. Preferred securities are represented by ICE BofA US Capital Securities Index since ICE BofA US All Capital Securities Index has a shorter history starting from 2012. Global corp HY are represented by Bloomberg Global Corporate High Yield Index; US high yield by ICE BofA US High Hield Index; EM USD bonds by ICE BofA Emerging Market External Sovereign Index; leveraged loans by Credit Suisse Leveraged Loan Index. Past performance is not indicative of future performance. 

 

Important Information

Manulife Global Fund (the “Company”) is an open-ended investment company registered in the Grand Duchy of Luxembourg. The Manulife Global Fund – Preferred Securities Income Fund (the "Fund") is recognised under the Securities and Futures Act of Singapore for retail distribution. The Company has appointed Manulife Investment Management (Singapore) Pte. Ltd. (Company Registration Number: 200709952G) as its Singapore Representative and agent for service of process in Singapore. The information provided herein does not constitute financial advice, an offer or recommendation with respect to the Fund. Opinions, forecasts and estimates on the economy, financial markets or economic trends of the markets mentioned herein are not necessarily indicative of the future or likely performance of the Fund. The Fund may use financial derivative instruments for the purposes of investment, efficient portfolio management and/or hedging. ​

Investments in the Fund are not deposits in, guaranteed or insured by the Manager and involve risks. Past performance of the manager or sub-manager is not necessarily indicative of its future performance. The value of units in the Fund and any income accruing to them may fall or rise. Past performance of the Fund is not necessarily indicative of future performance. Investors should read the Singapore prospectus, and seek advice from a financial adviser before deciding whether to purchase units in the Fund. A copy of the Singapore prospectus and the product highlights sheet can be obtained from Manulife or its distributors. In the event an investor chooses not to seek advice from a financial adviser, he should consider whether the Fund is suitable for him. 

Distributions are not guaranteed. Investors should refer to the Singapore prospectus for the distribution policy of the Fund. The Directors of the Company shall have the absolute discretion to determine whether a distribution is to be made in respect of the Fund as well as the rate and frequency of distributions to be made. Distributions may be made out of (a) income, or (b) net realized gains, or (c) capital of the Fund, or (d) gross income while charging all or part of the fees and expenses to capital, or (e) any combination of (a), (b), (c) and/or (d). Past distribution yields and payments are not necessarily indicative of future distribution yields and payments. Any payment of distributions by the Fund is expected to result in an immediate decrease in the net asset value per share of the Fund.​ 

This advertisement or publication has not been reviewed by the Monetary Authority of Singapore.​