• Emerging Market Bond Fund-04

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 Calamatta Cuschieri Funds 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

April 2018 Commentary

In line with the recent market movements, primarily conditioned by the 3% breach in the U.S. 10-year Treasury, EM bonds succumbed to selling pressure. It is of no surprise that following the triggered volatility, we experienced a strengthening dollar which in turn further conditioned EM hard currency valuations. In all fairness, we weren’t surprised by the experienced volatility in risky assets, however we were quite surprised by the sustained volatile momentum.

We believe that the market had touched a bottom, however volatility prevailed. Unfortunately, the market interpretation of a stronger dollar is always a negative for EM, which, to a certain extent is justified given the implied higher servicing costs. Despite being of the same view, we still believe that deep bottom-up analysis uncovers the preposition of a market irrational movement. A clear example, would be an EM credit which receives dollar revenues and holds such cash on its balance sheet to service its financing costs; this acts as a natural hedge. Thus in our view, we believe that at times markets do act irrationally, which however ultimately creates an exodus to safety. In all fairness, we were anticipating volatility and this is the reason why we held a remarkable cash and cash equivalents in the fund of circa 17%, which helped us to outperform the market.

Going forward, we still believe that the EM region still maintains a strong fundamental positioning when compared to developed economies. Thus we believe that the recent volatility is a market over re-action. The widening in spreads might have created opportunistic venues, even based on the fact that over the last couple of months we had a number of rising stars within the EM region, thus the spread widening might be unjustified. We still believe that through our bottom-up approach, over the long term, we should create value for our investors.

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 Calamatta Cuschieri Fund Services Ltd.
    Auditors Deloitte Malta
    Legal Advisors Ganado Advocates
    Launch Date 02 November 2017
    Domicile Malta
    Currency Euro (€)
    Dealing Frequency Daily
    Fund Size -
    Number of Holdings -
    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 %
    China 14.9
    Brazil 14.2
    Russia 10.8
    Turkey 9.7
    Malta (incl. cash) 8.8
    Germany 8.1
    Indonesia 6.2
    Mexico 4.3
    Netherlands 4.1
    Supranationals 3.8

    *including exposures to CIS, using look-through.

    Maturity Buckets*

    Age %
    0 – 5 years 66.0
    5 – 10 years 22.5
    10 years+ 0.0

    * based on the Next Call Date

    Performance History

    Calendar Year Performance  YTD 2017 *** 2016 2015 Since
    Inception ***
    Share Class C – Total Return -3.45 -1.24 - - -4.65
    Total Return 1-month 3-month 6-month 9-month
    Share Class C – Total Return -1.39 -4.01  -  -

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

  • Historical Performance to Date

    Top 10 Exposures %

    Exposure %
    8.125% Global Liman 2021 4.4
    4.95% Gazprom 2022 4.4
    6.50% Global ports Fin 2023 4.3
    1.375% KFW 2018 4.3
    7.25% JBS 2024 4.2
    6.90% Yestar Healthcare 2021 4.1
    4.95% Veon Holdings 2024 4.1
    6.50% Minerva 2026 4.1
    5.00% Nidda Bondco 2025 3.8
    5.299% Petrobras 2025 3.7

    By Credit Rating *

    Credit Rating %
    Investment Grade 37.9
    BB 31.5
    B 26.3
    CCC+ 2.3
    Less than CCC+ 0.0
    Not Rated 0.0
    Average Credit Rating BB

    * excluding exposures to CIS

    Currency Allocation

    Currency %
    USD 90.0
    EUR 8.3
    TRY 1.7

    Asset Allocation

    Currency %
    Cash 8.8
    Bonds (incl. ETFs) 88.5
    Equities (incl. ETFs) 2.7

    Sector Breakdown*

    Sector %
    Consumer, Non-Cyclical 25.6
    Financial 18.0
    Communications 14.9
    Government 9.5
    Energy 8.2
    Consumer, Cyclical 6.4
    Basic Materials 6.3
    Industrial 1.3

    *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 Emerging Market Bond Fund is a sub fund of Calamatta Cuschieri Funds 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 CCFS PLC prospectus and KIID document, which may be obtained from CCIS offices. Issued by CCIS.
 
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 CC to any person to buy or sell any investment. CC 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 CC.
 
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