OP-High Yield

Converting low confidence levels to sizeable yields

Higher risk is followed by higher yield. This is the underlying idea of the OP-High Yield bond fund which aims to turn lower grade corporate bonds into returns for the investor's portfolio.

  • The fund invests in bonds issued by companies with low credit ratings.
Subscription fee Annual management fee Redemption fee
0,50 % 0,80 % 0,50 %

Agreements under a systematic investment plan are not subject to subscription fees. Fund units generate OP bonuses.

OP-High Yield primarily invests in bonds issued by companies with low credit ratings in the European Economic Area. Since the fund invests in bonds of companies with low credit ratings, repayment is estimated to be subject to above-average risks. To counter this uncertainty, these bonds’ yield potential is significantly higher than that of government bonds or loans issued by companies with high credit ratings.

Fixed-income investments are considered a valid method to lower a portfolio's total risk. OP-High Yield offers appealing interest income potential to a risk-tolerant investor. Although the repayment of high yield bonds involves risk, as an investment vehicle they carry lower risk than the equity market. Since the fund hedges its non-euro investments against currency risks as fully as possible, the fund unit holder does not have to bear the currency risk. OP-High Yield is mainly recommended to an investor who intends to redeem his/her units after four years at the earliest.

Read the portfolio manager's review on the fund's Finnish pages.

OP-High Yield (Fund) is a long-term bond fund which mainly invests its assets in bonds issued by companies whose credit rating for long-term debt is BB+ at the most, or similar. Investments are primarily made in bonds issued in the European Economic Area. The share of these investments typically varies between 75 and 100%. The Fund hedges its non-euro investments against currency risks as fully as possible. The modified duration of the Fund, a measure of the price sensitivity of a fixed-income investment to interest rate movements, is typically 2.5–5.0, which means that the Fund value will decrease by 2.5–5.0 percent if interest rates increase by one percentage point. If interest rates fall, the Fund’s value increases correspondingly.

The Fund's investments are mainly direct fixed-income investments. The Fund may use derivative instruments in order to hedge against adverse market movements, to replace direct investments and to otherwise promote effective portfolio management. The Fund may also invest in derivative contracts intended for credit risk transfer. Derivatives are chiefly used to manage interest rate and credit risks.

The Fund diversifies its investments broadly across various issuers' bonds. The Fund normally invests in some 70–100 issuers' fixed-income instruments but this number may vary depending on the portfolio manager's view.

The Fund’s benchmark is Barclays Pan European High Yield Index (3% constrained, Euro hedged). With active investing, the Fund seeks to outperform its benchmark index in the long term. The Fund mainly takes notable active risk and it may differ significantly from the composition, weights and risk level of the benchmark index.

The Fund promotes environmental and social characteristics and, to ensure it, uses environmental, social and governance (ESG) analysis and excludes certain investments. 

Exclusion: The Fund excludes from its active direct investments controversial weapon manufacturers, mining companies producing thermal coal, power companies using thermal coal, tobacco companies, and companies that have breached international standards and where engagement has been unsuccessful.  The list of exclusions is public. In addition to general exclusion rules, the Fund does not invest in companies whose principal business is in unconventional oil and gas extraction.

Use of ESG data in the investment analysis: ESG factors are considered in the investment process with the help of data by an external ESG service provider and the ESG tool developed internally by OP Asset Management. Considering ESG factors in the investment process means, for example, that the risks and opportunities related to the environment, society and governance are made transparent using selected indicators from each area. 

Violations of international standards: The Fund is screened regularly for non-compliances with international standards. In the event that a non-compliance is detected, an influencing process is begun with the company in question. The aim is to make non-compliant companies change their practices and begin to comply with international standards in their operations. If influencing proves fruitless, the company may be removed from the Fund portfolio and placed on the exclusion list.

Minimum share of sustainable investments: In accordance with the minimum amount stated below, the Fund allocates investments into companies whose business promotes one or more UN Sustainable Development Goals (SDG) without harming other sustainability factors or objectives. Sustainable investments are determined using OP Asset Management’s analysis model which is based on an external service provider’s SDG and sustainability data.

Assessing good governance practices: Analysing the target company’s governance is an important part of the investment process. To us, good governance is a key foundation for any company’s financial success, regardless of sector. When assessing governance, some of the areas considered include the appropriateness of the target company’s administrative organisation, the target company’s actions in relation to its personnel, and the target company’s rewarding and taxation practices. In assessing good governance, we use the analysis of third-party service providers and our own qualitative analysis if no external data is available. We screen the funds regularly to check them against the criteria of good governance. Minimum limits apply for these criteria. 

More details Basic data, performance and fact figures

Basic data

Fund manager
Tommi Kokkarinen, Ville Vuonokari, Jenni Hämäläinen
Benchmark index
Barclays Pan European High Yield Index (3 % constrained, Euro hedged)
Start date
01.11.2004
ISIN
FI0008807615
fund serie
Accumulation unit
Fund size
461 Meur
Serie value (27.03.)
219,80 EUR
Monthly review
Download
Key Information Document
Download
Rules
Download
Sustainability data
Download

Accumulated profit (26.03)

1mth 3mth 6mth 1 y 3 y p.a. 5 y p.a.
OP-High Yield A −0,33 % +1,09 % +6,77 % +10,89 % +0,81 % +1,56 %
Benchmark +0,18 % +1,75 % +7,22 % +11,88 % +1,25 % +2,74 %

Yearly performance

2019 2020 2021 2022 2023 YTD
OP-High Yield A +9,35 % −0,64 % +2,97 % −10,75 % +11,96 % +0,90 %
Benchmark +11,32 % +2,32 % +3,46 % −10,72 % +12,32 % +1,59 %

Key figures

Volatility 12 m vola 12m Sharpe 12 m Duration
OP-High Yield A 2,74 % - -
Benchmark index - - -

As our owner-customer, saving and investing is especially worthwhile thanks to the excellent benefits you receive.

Your benefits when investing in funds or through insurance:

  • Buy and sell almost all OP mutual funds with no fees.*
  • You earn 0.35% OP bonuses from mutual fund and insurance assets.** 
  • Begin saving through insurance free of charge. 
  • Switch between investments, invest additional funds and change your payment and investment plan for OP Unit-linked Insurance and OP Savings Agreement free of charge in our digital services.  

Your benefits in equity and ETF investing:

  • Open an equity savings account or book-entry account free of charge.
  • You get a discount on equity trading and a 1% fee ceiling when trading in Finnish listed companies through a book-entry account The discounts apply in digital services.
  • Get access to free stock picks and analysis.
  • Get a discount on the service packages for savers and investors:
    Equity savings account: 
    Saver: €0/month (normally €2.99/month)
    Investor: €9.99/month (normally €14.99/month)
    Book-entry account: 
    Saver: €0/month (normally €2.99/month)
    Investor: €0/month (normally €5.39/month)

Other benefits:

  • Only owner-customers can invest in Profit Shares.

Remember to make use of all benefits:

*Standard fees are charged for the following special common funds: OP-Public Services Real Estate, OP-Forest Owner, OP-Rental Yield, OP-Alternative Portfolio and OP-Private Equity.

**OP bonuses are automatically used to pay the bank’s service charges and insurance premiums. No OP bonuses are accrued from the R2 Crystal special common fund or institutional classes of funds. The following investment products linked to insurance assets do not accrue OP bonuses: JPM Russia A, JPM Emerging Europe Equity Fund, and BlackRock GF Emerging Europe Fund A. OP bonuses are accrued from unit-linked insurance policies, excluding Individual Unit-linked Insurance and Individual Capital Redemption Contracts.  

This is an advertisement. Remember that investment always involves risks. The value of investments can rise and fall, and an investor can lose part or all of the money they invest. OP funds are managed by OP Fund Management Company Ltd, with OP cooperative bank acting as its agent. Normal transaction costs are charged for the following special common funds: OP-Public Services Real Estate, OP-Forest Owner, OP-Rental Yield, OP-Alternative Portfolio and OP-Private Equity special common funds.