Bond funds managed by PIMCO and Tyndall have been upgraded to Standard & Poor's (S&P) Fund Services' highest ratings following the research house's review of the Australian fixed interest fund sector.
Ratings on the EQT PIMCO Wholesale Australian Bond Fund and Tyndall Australian Bond Fund were raised to five stars from four.
A key reason for S&P's upgrade on PIMCO was the addition of Robert Mead as portfolio manager of the Australian bond fund and head of portfolio management in Australia, S&P fixed interest sector head David Erdonmez said.
"S&P feels that Mead is one of the more impressive portfolio managers that we engage with as part of our analysis of this sector," he said.
"Given the global reach of the firm and high skill level of all individuals involved it is difficult to envisage a superior configuration."
S&P said Tyndall's fixed interest team continues to be led by its experienced head of fixed interest Roger Bridges.
"Members are highly credentialed and experienced, and bring an exceptional level of numerical competency. We continue to favourably view this process, which is considered well structured, uncomplicated, and a key source of alpha," Erdonmez said.
New ratings were also assigned to the EQT PIMCO Wholesale Australian Focus Fund and Perennial's Tactical Income Trust.
PIMCO's product received five stars, while Perennial's gained four.
Both products are similar in duration approach, with a strategic duration profile of around 1.8 years through the incorporation of a 50/50 benchmark comprising the UBS Bank Bill Index and the UBS Composite Bond Index, S&P said.
"Through these products, both managers are in effect offering to manage clients' interest rate exposure as rates move through the cycle," S&P said.
