• 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

November 2017 Commentary

On 02 November 2017, the CC Emerging Market Bond Fund was launched with an initial Fund size just shy of the $3million mark and closed off the month with $4.8mn in assets under management. From the get go, the Investment Manager was cautiously and judiciously building position but was in no particularly of rushing into getting the fund fully invested, given the volatility being witnessed in emerging markets during the month of November. Nevertheless, the Investment Manager remained intent on building those positions, which contributed to the carry trade of the Fund whilst also building position in bonds denominated in EUR. Yields on Eurozone government bonds spreads were relatively volatile during the month of the November but nonetheless range traded and ended off the month more or less where they started. No major events in November, merely profit taking and investor positioning for 2018 and preservation of performance heading into the New Year.

Emerging markets (EM) have over the years offered very generous returns to investors, despite the fact that the sensitivity to both commodities and the movement in the dollar currency have always been seen as a threat to the said regions. There is much to say why EM countries do offer an opportunity to investors. Few may be aware but in reality, selective EM countries are much better
positioned than developed economies from a fundamental perspective.

The market’s appetite for risk evidently dropped in November, with credit market affected the most. US high yield and emerging market credit were worse hit as they had been trading at very tight spreads. There now appears to be a recovery, but there are several fundamental factors that could drive a change in the credit landscape in 2018: rising yields, volatility and the impact of US tax reforms.

Nevertheless, markets remain well positioned to close off the year on a strong footing. The recent downward correction in emerging market local currencies as well as high yield credit has recovered, with lower rates remaining the supporting factor. Moreover, a weaker US Dollar coupled with the current low inflation and buoyant growth outlook has been benign for risky assets globally.

Global economic growth has been supportive and surprised to the upside, which in turn has buoyed commodity related sectors, in particular oil & gas and basic materials. However, apart from technology and commodities, most sectors have underperformed on an earnings growth basis. Future earnings growth will therefore be very sensitive to China. Going forward, the recurrent theme will be China as there are slight signs that the economy is losing steam and slowing.

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 %
    Malta 61.0
    Brazil 15.9
    Poland 6.4
    China 5.0
    Bahamas 4.3
    Turkey 4.3
    Indonesia 4.2
    Bermuda 4.1
    Germany 2.6
    Spain 2.4

    *including exposures to CIS, using look-through

    Maturity Buckets*

    Age %
    0 – 5 years 28.3
    5 – 10 years 22.4
    10 years+ 0.0

    * based on the Next Call Date

    Performance History **

    Calendar Year Performance  YTD 2016 2015 2014 Since
    Inception *
    Share Class C – Total Return - - - - -1.00
    Total Return 1-month 3-month 6-month 9-month
    Share Class C – Total Return -1.00 -  -  -

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

  • Historical Performance to Date

    Top 10 Exposures %

    Exposure %
    5.299% Petrobras 2025 7.4
    3.00% Republic of Poland 2023 6.4
    6.125% Vedanta 2024 4.3
    8.125% Global Liman 2021 4.3
    7.50% China Evergrande 2023 4.3
    4.875% Gerdau Trade 2027 4.2
    5.875% JBS 2024 4.2
    6.625% Alam Synergy 2022 4.1
    6.75% Digicel Limited 2023 4.1
    5.00% Nidda Bondco 2025 2.6

    By Credit Rating *

    Credit Rating %
    BBB 10.7
    BB 7.4
    B 30.5
    CCC+ 0.0
    Less than CCC+ 0.0
    Not Rated 0.0
    Average Credit Rating BB

    * excluding exposures to CIS

    Currency Allocation

    Currency %
    EUR 92.7
    USD 7.3
    Others 0.0

    Asset Allocation

    Currency %
    Cash 47.4
    Bonds (incl. ETFs) 50.6
    Equities (incl. ETFs) 2.0

    Sector Breakdown*

    Sector %
    Consumer, Non-Cyclical 11.2
    Basic Materials 8.7
    Financial 8.6
    Energy 7.4
    Communications 6.5
    Government 6.5
    Industrial 2.4

    *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