Loomis Sayles to launch high-yield mutual fund

Loomis Sayles & Co. said it will start a mutual fund in December that will invest in junk bonds and related derivatives. The Loomis Sayles Absolute Strategies Fund may invest entirely in high-yield bonds, though will generally aim to limit its exposure to no more than half of its assets, according to a prospectus filed yesterday with the Securities and Exchange Commission. The fund also may buy investments that aren't denominated in U.S. currencies. The asset manager's first mutual fund that has the ability to buy derivatives, the Loomis Sayles Multi-Asset Real Return Fund, began operating yesterday, said Erin Heard, a spokeswoman for Boston-based Loomis Sayles. “There's a need for funds that are more flexible, to go where the opportunities are,” she said. She declined to comment on the Absolute Strategies Fund. Matthew Eagan, Kevin Kearns and Todd Vandam will manage the new fund's assets, according to the prospectus. Eagan currently oversees $52.5 billion of investments and Kearns $4.66 billion, the prospectus said. High-yield, high-risk -- or junk -- debt is rated below Baa3 by Moody's Investors Service and BBB- by Standard & Poor's. Boston-based Loomis Sayles, a unit of Natixis Global Asset Management LP, managed $140.9 billion of assets as of June 30, according to its website.