Gemini Investment Management, the London-based fund manager, has unveiled a new high income fund which aims to deliver a 10 per cent per annum return through investment mainly in loan notes.

Gemini is of the view that loan notes can offer greater capital security and less volatility than traditional fixed income instruments (there is of course greater risk concomitant with the higher yield). The firm will be investing in 36-month loan notes, where the underlying loans which make up the value of each note are guaranteed.

The Gemini High Income Fund, which has the 3-month LIBOR rate as its benchmark, is run by Cheviot Asset Management and is domiciled in Ireland. It carries a minimum investment of £100,000 ($157,000) and an annual management fee of 1.25 per cent.

Income from the fund will be paid semi-annually and any income can be rolled up within an accumulation share class.