Schroders has launched a strategic bond fund which aims to offer investors a total return by investing across fixed income markets.

The fund will sit in the Investment Management Association Strategic Bond sector and be managed by senior portfolio manager Gareth Isaac.

Mr Isaac joined Schroders last year and previously worked at GLG and SG Asset Management.

The fund will allocate investment between government bonds, investment grade corporates, high yield corporates and emerging markets governments and credit debt. It may also use derivatives to limit downside risk.

Robin Stoakley, managing director of the UK intermediary sector at Schroders, said: “We are delighted to launch a fixed income offering which allows the fund manager flexibility to invest in the full spectrum of fixed income instruments globally.

“This fund is ideal for fixed income investors seeking higher performance potential and is an excellent way to diversify from an allocation to pure equities.”

Mr Isaac said: “Against the backdrop of rock bottom interest rates in the western world combined with low yields on money market and government bonds, investors are turning their attention to alternative fixed income asset classes such as investment grade and high yield bonds for better returns.

“We currently see fantastic value in good quality corporate and high yield issuers as part of a balanced fixed income portfolio.”