• Emerging-Market-Bond-Fund-Nov-2019_WEB-BANNER-EURO--accumulator

EM Bond Fund EUR Accumulator

  • Investment Objectives

    The objective of the Sub-Fund is to endeavour to maximise the total level of return for investors through investment primarily, in a well-diversified portfolio of debt securities and other fixed-income or interest bearing securities.

    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 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

December 2020 Commentary

In emerging markets (EM), fixed income indices closed the year with decent total returns. Last year’s supply set a historical record of USD 243 billion. This was well absorbed, as demand was supported by abundant global liquidity and historically higher yields. Issuance was dominated by IG sovereigns, which priced three quarters of the total amount.

China is an important part of EM growth dynamics. The world’s second-largest economy is leading the global restart in activity, with its growth going from strength to strength. This bodes well for the rest of the EM world. Yet EM economies are also susceptible to the policy direction of China. It is worth highlighting the deteriorating diplomatic relations with its key trading partner, namely Australia. Furthermore, new tensions between China and the US continue to fester, with the threat of delisting Chinese companies from US exchanges over reporting practices keeps growing. Certain Chinese government-linked companies in the telecommunications sector have already been banned.

Manufacturing continues to show resilience, outperforming the service sector, a theme which has been witnessed since the commencement of the pandemic inflicted restrictions. The positive data has been a cornerstone for confidence in the markets. Despite a higher than average savings rate, the trend is now significantly downwards, as businesses and consumers have better visibility over a return to normality. Concerns remain over the ability to rollout the vaccine within the first half time-frame due to logistical challenges, an issue considered more particular to less developed nations. The rollout of the newly approved Oxford vaccine should abate some of those concerns, as the vaccine is easier to handle from a logistical point of view.

On the macroeconomic front, China has continued to print positive figures as the latest Manufacturing PMI came in above expectations at 54. China’s Foreign reserves jumped to $3,178bn in November from $3,128bn in October (consensus $3,150bn).

China reported stronger results in its leading indicators, as business activity normalises further, following widespread company shutdowns and travel restrictions earlier in the year. The latest GDP growth reading stands at 2.7% for the third quarter of 2020 and is expected to accelerate further as economies ramp up in 2021.

From the Latin America region, economic data in Brazil remained encouraging, with manufacturing PMIs reporting at 61.5 from 64.0 in November and similarly services remaining in growth territory at 51.1. Yet, there are growing concerns over the Covid-19 outbreak in Brazil and the delay in the country’s reform and fiscal consolidation agenda. Despite substantial gains in terms of trade and exports, domestic risks are strong. Something will have to give as the combination of a weak currency and sharp commodity appreciation would be difficult to sustain for two years in a row without pass-through into domestic prices.

From a technical perspective, EM debt is expected to keep pace with high yield credit in developed markets, as higher yielding debt looks attractive to investors in search of income.

In the month of December, the CC EMBF increased by 1.3%, in line with the benchmark. 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 C (Accumulator) – 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 02 November 2017
    Domicile Malta
    Currency Euro (€)
    Dealing Frequency Daily
    Fund Size $12.9 m
    Number of Holdings 40
    Initial Charge up to 2.50%
    Management Fee 1.10%
    Dividend Payment Dates N/A
    ISIN number MT7000021242
    Minimum Initial Investment €2,500
    Minimum Additional Investment €500

    Top 10 By Country*

    Country %
    Malta (incl. Cash) 25.4
    Brazil 19.2
    China 11.1
    Mexico 7.7
    Turkey 7.5
    Russia 6.7
    Germany 4.9
    Netherlands 3.4
    Indonesia 2.9
    India 2.8

    *including exposures to CIS, using look-through.

    Maturity Buckets*

    Age %
    0 – 5 years 47.2
    5 – 10 years 20.2
    10 years+ 7.2

    * based on the Next Call Date

    Performance History **

    Calendar Year Performance  YTD 2019 2018 2017*** Annualised Since
    Inception ***
    Share Class C – Total Return -3.19 6.57 -9.09 -1.24 -2.39
    Total Return 1-month 3-month 6-month 9-month 12-month
    Share Class C – Total Return 1.29 4.98 6.79 17.25 -3.19

    * The EUR Accumulator Share Class (Class C) was launched on 03 November 2017.

  • Historical Performance to Date

    Top 10 Exposures %

    Exposure %
    iShares JPM USD EM Bond Fund 6.5
    iShares JPM USD EM Corp Bond 6.0
    6.5% Global Ports Finance 2023 3.5
    5.45% Cemex 2029 3.4
    4.95% Veon Holdings 2024 3.4
    5.8% Turkcell 2028 3.3
    6.625% TUPY Overseas SA 2024 3.3
    6.625% NBM Holdings 2029 2.7
    5.299% Petrobras Global 2025 2.7
    3% Republic of Poland 2023 2.5

    By Credit Rating *

    Credit Rating %
    AAA to BBB- 14.8
    BB+ to BB- 39.7
    B+ to B- 13.0
    CCC+ 1.9
    Less than CCC+ 5.2
    Not Rated 0.0
    Average Credit Rating BB

    * excluding exposures to CIS

    Currency Allocation

    Currency %
    USD 91.8
    EUR 8.2
    TRY 0.0

    Asset Allocation

    Asset %
    Cash 12.9
    Bonds (incl. ETFs) 87.1
    Equities (incl. ETFs) 0.0

    Sector Breakdown*

    Sector %
    Sovereign 20.2
    Telecommunications 11.7
    Real Estate 8.5
    Commercial Services 7.1
    Pharmaceuticals 5.0
    Auto Parts & Equipment 4.9
    Healthcare-Services 1.6
    Oil & Gas Services 1.6

    *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.

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.