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Global Balanced Income Fund

  • INVESTMENT OBJECTIVES

    The Fund seeks to provide stable, long-term capital appreciation by investing in a diversified portfolio of local and international bonds, equities and other income-generating assets. The Investment Manager shall diversify the assets of the Fund among different asset classes. The manager may invest in both Investment Grade and High Yield bonds rated at the time of investment at least “B-” by S&P, or in bonds determined to be of comparable quality, provided that the Fund may invest up 10% in non-rated bonds, whilst maintain an exposure to direct rated bonds of at least 25% of the value of the Fund. Investments in equities may include but are not limited to dividend-paying securities, equities, exchange traded funds as well as through the use of Collective Investment Schemes.

    Key Features of the Fund

    • Flexibility to invest in all regions around the world
    • Provide capital appreciation, stability and growth over the medium-to-long term
    •  Flexibility to switch between different asset types (eg. Bonds / Equities / Money Market Instruments / ETFs / CIS / alternative securities) depending on market outlook
    • Investment Manager will base asset allocation decisions based on key current themes and best opportunities to generate return
    • Asset Allocation Diversification by Security Type, Credit Rating, Country, Sector and by Currency
    • Best of both worlds – lower volatility of bond market vs growth potential via equities
    • OPTIMAL INVESTMENT MIX depending on market conditions
    • Efficient and Effective strategy to be able to withstand periods of adverse market movements
    • FX exposures will be generally hedged, underlying investor will not be exposed to any FX risk

Overview

→ Why CC Global Balanced Income Fund?
→ Investor Profile
→ Currencies Available
→ Entry and exit Fee
→ Minimum Investment
→ Monitoring and Pricing
→ Ideal for Accumulation Schemes
→ Fund Rules at a Glance
→ Other Information

Commentary

November 2017 Commentary

Profit taking took centre stage in November together with some spread widening in the fixed income market. Sovereign bonds led the retreat following ECB comments of complacency and all other fixed income asset classes followed suit.

Equities came under pressure too, and there has been a great focus on the US tax reform, although at the time of writing the US Senate passed the tax reform package, with a good chance it will now be in place by year end.

Having gotten this far the tax reform is likely to be signed into law. This will most likely mean a boost to 2018 US GDP Growth, additional Fed rate hikes and downward pressure on fixed income prices. It will also mean a stronger US dollar and an increase in demand for European products. Thus, unless optimism is derailed by anti-trade rhetoric, the tax cut should be supportive of European Equities.

At this juncture, the largest issue for the bond investor in credit markets, both the Investment Grade and High Yield investor, in EUR and USD, is the risk-reward profile being highly skewed away from the reward element. Record lows, in yields and spreads in almost ten years, notwithstanding the correction registered during the month of November, are the greatest indicators that markets had become toppish and ahead of themselves. In this vein, we think that the correction and profit taking was justified and warranted despite fundamentals remaining intact.

After 21 months of bonds rallying (since February 2016) the hunt for yield has not yet fizzled out and, at current valuations, HY and EM in particular remain the more attractive sub-segment within the fixed income space. We do not expect any major hiccups and/or hurdles in credit heading into year end.

Eurozone shares remain attractive, given the improving growth, expected company profits and supportive European Central Bank. With Euro-area growth heading for a strong December, expectations for 2018 are buoyant.

The Global Balanced is geared to benefit from growth in the Eurozone, an increase in consumer spending and an increase in exports in the region, all of which are on the cards in 2018.

Factsheet

  • Sub-Fund Name Global Balanced Income Fund
    Investment Manager Calamatta Cuschieri Investment Management Ltd
    Fund Type UCITS
    Custodian Sparkasse Bank Malta p.l.c.
    Fund Administrator Calamatta Cuschieri Fund Services Ltd.
    Auditors Deloitte Malta
    Legal Advisors Ganado Advocates
    Launch Date 1st September 2015
    Domicile Malta
    Dealing Frequency Weekly
    Initial Charge from 0% up to 2.5%
    Management Fee 1.25%
    Currency Euro (€)
    ISIN numbers EUR – MT7000014445
    Minimum Initial Investment EUR 2,500
    Minimum Additional Investment EUR 500
    Fund Size €4.8mn
    Number of Holdings 27

    Performance History (expressed in % terms)

    Calendar Year Performance YTD 2016 2015 2014 2013 Since
    Inception *
    Total Return 8.67 1.58 - - - 11.60
    Calendar Year Performance 1 -month 3 -month 6 -month 9 -month 12 -month
    Total Return -0.53 3.43 2.39 7.72 12.16

    * The Global Balanced Income Fund was launched on 30 August 2015.

    Top By Country*

     Country %
    France 16.4
    Germany 12.5
    Luxembourg 10.9
    United States 10.0
    Global 9.0
    Spain 5.4
    Italy 3.7
    Greece 3.5
    Asia 3.3

    *including exposures to ETFs

    By Credit Rating*

    Holding %
    BBB 0.0
    BB 10.7
    B 18.3
    Less than B- 0.0
    Not Rated 2.6

    *excluding exposures to ETFs

  • Performance to Date (Euro)

    Top 10 Exposures

     Exposure %
    iShares MSCI EM ETF 9.0
    Valeo SA 4.2
    6.75% Unicredit 2166 3.7
    iShares Euro HY Corp Bond ETF 3.7
    7.50% Garfunkelux 2022 3.7
    6.50% Lecta 2023 3.6
    4.00% Ineos 2023 3.6
    Renault SA 3.5
    5.25% Intralot 2024 3.5
    iShares MSCI EM Asia ETF 3.3

    Currency Allocation

    Currency %
    EUR 68.0
    USD 28.6
    GBP 3.4

     

    Asset Allocation*

    Asset %
    Cash 10.8
    Bonds 36.8
    Equities 52.5

    *including exposures to ETFs

    Maturity Buckets

    Number of Years %
    0 – 5 years 27.5
    5 – 10 years 4.1
    10 years + 0.0

     

    Sector Breakdown

    Sector %
    ETFs 28.7
    Consumer, Cyclical 20.9
    Financial 18.3
    Basic Materials 11.9
    Technology 4.8
    Consumer, Non-Cyclical 3.2

Legal Information

This document has been issued by Calamatta Cuschieri Investment Services (“CCIS”). 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. 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. 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