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Euro High Income Bond Fund

  • INVESTMENT OBJECTIVES

    The CC Euro High Income Bond Fund Distributor aims to maximise the total level of return for investors through investment in a diversified portfolio of Bonds. The Investment Manager invests primarily in a diversified portfolio of over 65 intermediate term, corporate & government bonds with maturities of 10 years and less.

    STRUCTURE

    The Fund operates under the UCTIS 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 Funds are managed by a group of investment professionals at Calamatta Cuschieri Investment Management Limited who monitor developments on a daily basis.

Overview

→ Investor Profile
→ Currencies Available
→ Dividend Payment
→ Dividend Re-Payment
→ Monitoring and Pricing
→ Entry and Exit Fees
→ Minimum Investment
→ Fund Rules at a glance
→ Target dividend
→ Other Information

Commentary

August 2019 Commentary

The month of August proved to be turbulent due to increased uncertainties surrounding the trade war saga. Indeed, it kicked-off with the U.S. slapping a 10% tariff on $300 billion of Chinese imports from September, while China retaliated by announcing a further 5-10% on $75 billion worth of goods by the beginning of September.

These moves were the latest punches that spooked investors and raised fears that the global economy will dip into a recession. This led to a downbeat mood that hit risky assets, while the U.S yield curve inverted as investors continued to fear a downturn in the global economy.

Elsewhere, in Europe, ECB officials considered a stimulus package, as the trade war saga continued to pose risks on global growth. Proposals being discussed are a further cut into the deposit rate, while possibly re-activating the quantitative easing programme. In addition, the euro-area was also faced with political disruptions, namely in Italy with a fall in the coalition government, which triggered an upward move in Italian yields and to other peripherals. That said, towards the end of the month we saw some form of stabilization following the high odds of a new coalition government formed by the Five Star Movement and the Democratic Party.

More concerning signs came from the data front, which ultimately will put more pressure on the ECB to take the necessary easing decisions. In fact, the German economy contracted 0.1 percent quarter on quarter and net external demand contributed negatively to the GDP, as exports decreased with a higher magnitude than imports.

Brexit continues to be topical with the Sterling slumping to lower levels, after Boris Johnson said he would schedule the formal reopening of parliament for Oct 14 – a highly controversial move that would restrict parliamentary time before the Brexit deadline and increase the chances of U.K leaving EU with no deal.

European High Yield, in the month of August, gained 0.661 percent primarily due to income returns while price returns were capped due to a slight tightening on increased probability of monetary stimulus.

During the month, the Manager trimmed from high beta names, while opting to reduce exposures in credit stories that were facing increasing specific risks. Given the heightened uncertainty, the Manager believes that a more cautious approach is warranted and in this regard, the fund’s beta was reduced when compared to the market’s beta. Going forward, the Manager is still of the view that given monetary stimulus credit markets might have room for further appreciation. However, volatility will possibly continue to weigh on markets.

 

Factsheet

  • NAV/Price: Latest Price available here

    Sub-Fund Name Euro High Income Bond Fund (Distributor)
    Investment Manager Calamatta Cuschieri Investment Management Ltd
    Fund Advisor DF – Asset Allocation (Lugano, Switzerland)
    Custodian Sparkasse Bank Malta p.l.c.
    Fund Administrator CC Fund Services (Malta) Limited
    Auditors Deloitte Malta
    Legal Advisors Ganado Advocates
    Launch Date 1st September 2011
    Domicile Malta
    Currency Euro (€)
    Dealing Frequency Weekly
    Fund Size €44.8 mn
    Number of Holdings 95
    Initial Charge up to 2.5%
    Management Fee 1%
    Dividend Payment Dates 31 March – 30 September
    ISIN numbers EUR – MT7000003059
    Minimum Initial Investment € 2,500
    Minimum Additional Investment € 500

    Historical Performance to Date (Euro)

    Performance History **

    Calendar Year Performance 2013 2012 2011*** Since Inception***
    Share Class D – Total Return 6.43  17.07  -0.75  35.86
    Calendar Year Performance YTD 2018 2017 2016
    Share Class D- Total Return 5.16 -6.44 5.31 4.97
    Rolling 12 month performance to last month end 29/08/1828/08/19 30/08/1729/08/18 31/08/1630/08/17
    Share Class D- Total Return 0.70 -1.12  5.04

    *Data in the chart does not include any dividends distributed since the Fund was launched on 1st September 2011.

    **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 Distributor Share Class (Class D) was launched on 01 September 2011.

    Top 10 By Country*

    Country %
    Malta 12.9
    France 11.5
    Germany 9.8
    Spain 8.1
    Brazil 6.8
    USA 5.3
    Switzerland 4.7
    Russia 3.3
    UK 3.1
    Ireland 2.9

    *including exposures to CIS

  • Maturity Buckets*

    Age %
    0 – 5 years 49.4
    5 – 10 years 16.4
    10 years+ 0.3

    *based on the Next Call Date

    Top 10 Exposures %

    Exposure %
    5.00% Nidda Bondco 2025 2.3
    4.125% HP Pelzer 2024 2.3
    6.00% Loxam 2025 2.1
    4.00% Chemours 2026 2.1
    2.25% Portugal Gov’n 2034 2.1
    5.00% Tendam Brands 2024 2.1
    5.875% Selecta 2024 1.9
    7.50% Garfunkelux 2022 1.7
    7.00% Marb Bondco 2024 1.7
    6.75% Promontoria 2023 1.6

    By Credit Rating*

    Credit Rating %
    BBB 18.5
    BB 25.6
    B 29.8
    CCC+ 1.9
    Less than CCC+ 0.4
    Not Rated 10.2
    Average Credit Rating BB-

    *excluding exposures to CIS

    Currency Allocation

    Currency %
    EUR 84.5
    USD 15.5
    Others 0.0

    Asset Allocation

    Currency %
    Cash 8.2
    Bonds 86.3
    CIS/ETFs 5.5

    Sector Breakdown*

    Sector %
    Financial 24.9
    Consumer, Cyclical 14.3
    Consumer, Non-Cyclical 10.6
    Industrial 8.6
    Basic Materials 8.2
    Communications 6.5
    Energy 5.2
    Government 4.6
    Utilities 1.8

    *excluding exposures to CIS

Legal Information

THIS DOCUMENT HAS BEEN ISSUED BY CALAMATTA CUSCHIERI INVESTMENT SERVICES LTD (“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 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. 

*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.

CALAMATTA CUSCHIERI INVESTMENT SERVICES LTD. (CCIS) IS LICENSED BY THE MFSA. THE CC HIGH INCOME BOND FUND IS A SUB FUND OF CCFUNDS SICAV PLC AND IS AUTHORISED BY THE MFSA. INVESTORS MAY INCUR A SUBSCRIPTION CHARGE AND MAY BE SUBJECT TO TAX ON DISTRIBUTIONS. INVESTMENT SHOULD BE BASED ON THE PROSPECTUS AND KIID DOCUMENT, WHICH MAY BE OBTAINED FROM CCIS OFFICES.

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.