• em-bond-fund-eur-distributor-institutional

EM Bond Fund EUR Distributor Institutional

  • Investment Objectives

    The Fund aims to maximise the total level of return for investors through investment primarily, in a well-diversified portfolio of fixed-income investments.

    Key Features of the Fund

    The Fund aims to maximise the total level of return for investors through investment, primarily, but not solely in a diversified portfolio of Emerging Market Corporate fixed income securities and Emerging Market Government fixed income securities with maturities of 10 years or less, rated at the time of investment “Baa1” to “Caa1” by Moody’s or “BBB+” to “CCC+” by S&P, or in bonds determined to be of comparable quality by the Investment Manager. The Investment Manager may also invest up to 10% of the Net Assets of the Sub-Fund in unrated fixed income securities. The Investment Manager is expected to focus on Emerging Market fixed income securities, corporate and/or government, and seek to maintain an average credit quality of “B3” by Moody’s or “B-” by S&P, although issues may be rated lower or higher. The Investment Manager may also invest up to 15% of the Net Assets of the Sub-Fund in Emerging Market equities. The Investment Manager will not be targeting equities of a particular market capitalisation.

    Structure

    The Sub-Fund forms part of the CCFunds Sicav plc and operates under the UCITS structure which has become the gold standard for EU investment funds for retail investors. UCITS funds are ideal for retail investors as they have been specifically designed to ensure diversification and liquidity through distinct parameters, permitted asset classes and investment restrictions as set out in EU law.

    Management

    The CC Emerging Market Bond Fund is managed by a group of investment professionals at Calamatta Cuschieri Investment Management Limited who monitor market developments on a daily basis.

Overview

→ Investor Profile
→ Currencies Available
→ Dividend Payment
→ Monitoring and Pricing
→ Entry and Exit Fee
→ Minimum Investment
→ Fund Rules at a Glance
→ Other Information

Commentary

January 2021 Commentary

Consequent to the unprecedented coronavirus pandemic which infected over a 100 million people and led to 2.2 million deaths worldwide, 2020 was a year of extraordinary challenges. Despite the efforts made by governments and central banks to mitigate the impact on the economy, through substantial monetary and fiscal stimulus packages, the global economy (as estimated by the International Monetary Fund) contracted by 3.5 per cent.

Corporate credit, hindered at the peak of the pandemic following growing concerns about their ability to service debt, recovered. Credit spreads previously witnessing substantial widening (reaching significant highs of over 1000bps), tightened, with both investment grade and high yield issuers delivering strong positive total returns. U.S. investment grade and EM high yield outperformed its European counterparts.

Contrasting the more developed economies, emerging market economies started 2021 generally on a less positive note. Coronavirus related concerns, notably; the renewed coronavirus outbreaks and logistical issues surrounding coronavirus vaccinations, weighed on investors.

From the data front in the emerging market world, China – the world’s second largest economy and one of the few to register growth for 2020, witnessed softness in its data. In January, while remaining within expansionary territory, China reported a drop for both manufacturing and services sector.

In January, China’s manufacturing PMI fell to a seven-month low of 51.5 from 53.0 in December, and lower than market expectations of 52.7. Both output and new orders rose at softer paces, while export sales shrank for the first time in six months due to a resurgence in coronavirus infections globally and ensuing movement restrictions. After broadly stabilizing in December, employment within the manufacturing sector fell. Also, manufacturers recorded the slowest accumulation in backlogs of work for eight months. Meanwhile, services PMI dropped to a nine-month low of 52.0 from 56.3 in the December 2020.

From the Latin American region, published economic data dampened Brazil’s positive run. Notably, business confidence in Brazil declined to 60.9 points in January 2021 – the lowest since August 2020 as expectations over the next six months regarding the country’s economic situation deteriorated. The recent surge in coronavirus infections, particularly in the Amazonas state which pushed hospitals in the capital Manaus to their limits, the country’s struggle with its vaccine rollout, and political tensions surrounding the need for further social spending to help struggling Brazilians is indeed worrisome.

Meanwhile, Brazil reported a lower manufacturing PMI for the month of January, at 56.5 when compared to December’s, standing at 61.5. The first reading of 2021 pointed to the smallest expansion since June 2020. Production and new orders continued to rise solidly although at weaker rates, while export orders broadly stagnated. Employment softened to the weakest in the current seven-month sequence of expansion as corporates became increasingly cautious about their expenditures.

From a technical perspective, emerging market debt is expected to keep pace with high yield credit in developed markets, as higher yielding debt remains an attractive avenue for those investors in search of a higher yield.

In the month of January, the CC Emerging Market Bond Fund fell by -0.37 per cent, beating the benchmark by 28bps. Throughout the month the Manager continued to seek pockets of value by looking into attractive credit stories, primarily within metals and mining, energy, and financial sectors – the latter of which is domiciled in India, an economy which may present further opportunities in the near future given its macroeconomic dynamics.

Going forward, the Manager will continue to assess the EM space scenario even on the basis of further monetary policy actions taken by Central Banks, which seem to follow the Fed’s accommodative stance.

Factsheet

  • NAV/Price: Latest Price available here

    Sub-Fund Name Emerging Market Bond Fund – Class F (Distributor) – EUR
    Investment Manager Calamatta Cuschieri Investment Management Ltd
    Fund Advisor N/A
    Custodian Sparkasse Bank Malta p.l.c.
    Fund Administrator CC Fund Services (Malta) Limited.
    Auditors Deloitte Malta
    Legal Advisors Ganado Advocates
    Launch Date 06 February 2020
    Domicile Malta
    Currency Euro (€)
    Dealing Frequency Daily
    Fund Size $13.4 m
    Number of Holdings 44
    Initial Charge up to 2.50%
    Management Fee 0.65%
    Dividend Payment Dates 31 March – 30 September
    ISIN number MT7000026456
    Minimum Initial Investment €100,000
    Minimum Additional Investment Nil

    Top 10 By Country*

    Country %
    Malta (incl. Cash) 22.0
    Brazil 17.8
    China 11.2
    Turkey 7.4
    Mexico 7.3
    Russia 6.5
    India 5.1
    Germany 4.6
    Oman 3.9
    Netherlands 3.2

    *including exposures to CIS, using look-through.

    Maturity Buckets*

    Age %
    0 – 5 years 45.4
    5 – 10 years 26.0
    10 years+ 6.6

    * based on the Next Call Date

    Performance History **

    Calendar Year Performance  YTD 2020*** 2019 2018 Since
    Inception
    Share Class D – Total Return -0.42 -3.11 - - -3.58
    Total Return 1-month 3-month 6-month 9-month 12-month
    Share Class D – Total Return -0.42 4.23 4.63 11.93 -

    * Data in the chart does not include any dividends distributed since the Fund was launched on 03 November 2017.
    ** Performance figures are calculated using the Value Added Monthly Index “VAMI” principle. The VAMI calculates the total return gained by
    an investor from reinvestment of any dividends and additional interest gained through compounding.
    *** The EUR Distributor Share Class (Class F) was launched on 06 February 2020.

  • Historical Performance to Date *

    Top 10 Exposures %

    Exposure %
    iShares JPM EM Bond Fund 6.1
    iShares JPM USD EM Corp Bond 5.7
    6.5% Global Ports Finance 2023 3.3
    5.45% Cemex 2029 3.2
    5.8% Turkcell 2028 3.2
    4.95% Veon Holdings 2024 3.2
    6.625% TUPY Overseas SA 2024 3.0
    6.625% NBM Holdings 2029 2.6
    8.125% Global Liman 2021 2.5
    5.299% Petrobras Global 2025 2.5

    6

    By Credit Rating *

    Credit Rating %
    AAA to BBB- 16.3
    BB+ to BB- 42.7
    B+ to B- 12.3
    CCC+ 1.8
    Less than CCC+ 4.9
    Not Rated 0.0
    Average Credit Rating BB

    * excluding exposures to CIS

    Currency Allocation

    Currency %
    USD 90.8
    EUR 9.2
    Other 0.0

    Asset Allocation

    Asset %
    Cash 10.3
    Bonds (incl. ETFs) 89.7
    Equities (incl. ETFs) 0.0

    Sector Breakdown*

    Sector %
    Sovereign 15.6
    Telecommunications 11.2
    Real Estate 8.6
    Commercial Services 6.8
    Mining 5.1
    Pharmaceuticals 4.7
    Oil & Gas Services 1.6
    Auto Manufacturers 1.5

    *excluding exposures to CIS

Legal Information

CALAMATTA CUSCHIERI INVESTMENT SERVICES (CCIS) IS A FOUNDING MEMBER OF THE MALTA STOCK EXCHANGE AND IS LICENSED TO CONDUCT INVESTMENT SERVICES IN MALTA BY THE MALTA FINANCIAL SERVICES AUTHORITY. THE CC EMERGING MARKET BOND FUND IS A SUB FUND OF CCFUNDS™ SICAV PLC AND IS AUTHORISED BY THE MFSA. PERFORMANCE FIGURES QUOTED REFER TO THE PAST AND ARE NOT A GUARANTEE FOR FUTURE PERFORMANCE. THE VALUE OF THE INVESTMENT MAY RISE AS WELL AS FALL. INVESTORS MAY INCUR A SUBSCRIPTION CHARGE AND MAY BE SUBJECT TO TAX ON DISTRIBUTIONS. INVESTMENT SHOULD BE BASED ON THE CCFUNDS™ SICAV PLC PROSPECTUS AND KIID DOCUMENT, WHICH MAY BE OBTAINED FROM CCIS OFFICES. ISSUED BY CCIS.

*LAST 12 MONTHS DISTRIBUTION YIELD (01/04/2018 - 31/03/2019) SOURCE: CALAMATTA CUSCHIERI INVESTMENT MANAGEMENT. PERFORMANCE FIGURES QUOTED REFER TO THE PAST AND ARE NOT A GUARANTEE FOR FUTURE PERFORMANCE. THE VALUE OF THE INVESTMENTS INCLUDING CURRENCY FLUCTUATIONS, AND INCOME FROM THEM CAN GO DOWN AS WELL AS UP AND INVESTORS MAY NOT GET BACK THE FULL AMOUNT INVESTED.

THIS DOCUMENT IS PREPARED FOR INFORMATION PURPOSES ONLY AND SHOULD NOT BE INTERPRETED AS INVESTMENT ADVICE. THIS DOCUMENT DOES NOT CONSTITUTE AN OFFER OR INVITATION BY CCIS TO ANY PERSON TO BUY OR SELL ANY INVESTMENT. CCIS HAS BASED THIS DOCUMENT ON INFORMATION OBTAINED FROM SOURCES IT BELIEVES TO BE RELIABLE BUT WHICH HAVE NOT BEEN INDEPENDENTLY VERIFIED. THIS DOCUMENT MAY NOT BE REPRODUCED EITHER IN WHOLE, OR IN PART, WITHOUT THE WRITTEN PERMISSION OF CCIS.

THIS IS NOT A CAPITAL GUARANTEED PRODUCT ACCORDINGLY THE VALUE OF YOUR INVESTMENT CAN GO DOWN AS WELL AS UP. INVESTORS SHOULD NOTE THAT THE PAYMENT OF DIVIDENDS HAS THE EFFECT OF REDUCING THE NAV PER SHARE.