• CC FUNDS 2018_WEB BANNER EURO-01 (1)

High Income Bond Fund Euro Distributor

  • INVESTMENT OBJECTIVES

    The CC 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

June 2018 Commentary

June was one of the toughest months for credit markets and risky assets during the first half of the year, and was pretty much a reflection of what characterised credit markets in H1-2018. Risk-off mode, risk aversion, and flight to safety trades led to a marked widening in spreads and resulted in a negative performance for the month. High Yield, financials in particular, were amongst the worst hit.

Investors have been accustomed to moving down the ratings ladder in the search of better yields, or else by extending duration trades. This means that, over recent years, investors have had a marked increase in allocation to high yield bonds in their portfolios. However, the pace at which flows have flown into High Yield, across both sides of the Atlantic, have ebbed as uncertainty and volatility took centre stage for the greater parts of 2018.

In addition, the ECB confirmed that the end of QE will be in December, while interest rates will be maintained at the current levels surely until August 2019-a statement which hindered financial assets remarkably. All in all this has also led to expectations for rising sovereign yields, and hence higher benchmark rates. Relatively speaking credit has held up pretty well notwithstanding the increase in expectations in benchmark rates (and subsequently spreads), which could only mean that, if risk aversion persists, spreads could edge wider.

Trading conditions in these markets are not improving as trade war concerns persist and continue to hamper risk appetite across the board, thereby accentuating the increase in uncertainty and volatility, with the spread on financials, one of the worst hit sectors so far this year widening amid poor liquidity conditions and adverse market dynamics.

Undoubtedly, credit markets have become more volatile since the start of the year, with volatility almost being three times as much as it was at the turn of the year. What must be kept in mind is that, as expected, central banks are meant to bring Quantitative Easing to an end, which should dry up liquidity and possibly trigger an uptick in volatility.

Meanwhile, global trade and European politics continue to grab the headlines, with Donald Trump threatening 20% tariffs on European cars and markets having been nervous about escalating tensions between the US and China. In additions, flows into Emerging Markets have been weak and have registered a decline in the second quarter of 2018 mainly brought about by rising tensions and idiosyncratic risk emanating from Brazil and Turkey. In addition to this, we have the slower pace of expansion of central bank balance sheets to contend with, which leaves us with a tricky concoction of market-related issues, which are sure to make the second half of the year challenging, to say the least.

Factsheet

  • NAV/Price: Latest Price available here

    Sub-Fund Name High Income Bond Fund – EUR (Distributor)
    Investment Manager Calamatta Cuschieri Investment Management Ltd
    Fund Advisor DF – Asset Allocation (Lugano, Switzerland)
    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 2011
    Domicile Malta
    Currency Euro (€)
    Dealing Frequency Weekly
    Fund Size €50mn
    Number of Holdings 91
    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 2012 - - Since Inception ***
    Share Class D – Total Return 17.07  33.65
    Calendar Year Performance YTD 2017 2016 2015
    Share Class D- Total Return -3.22 5.31 4.97 -0.86
    Rolling 12 month performance to last month end 30/06/1730/06/18 30/06/1630/06/17 30/06/1530/06/16 30/06/1430/06/15
    Share Class D- Total Return -1.28 6.82  0.66  -2.49

    *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 %
    Germany 11.9
    France 9.6
    Spain 7.8
    Malta 6.7
    Luxembourg 6.7
    Great Britain 5.8
    Brazil 5.3
    United States 5.2
    Switzerland 3.8
    Netherlands 3.1

    *including exposures to CIS

  • Maturity Buckets*

    Age %
    0 – 5 years 53.0
    5 – 10 years 17.8
    10 years+ 1.9

    *based on the Next Call Date

    Top 10 Exposures %

    Exposure %
    4.125% HP Pelzer 2024 2.2
    4.00% Ineos 2023 2.0
    4.00% Chemours 2026 2.0
    9.25% EIB 2018 1.9
    6.50% Lecta 2023 1.8
    7.25% Aldesa 2021 1.7
    6.25% Sylnab 2022 1.6
    7.50% Garfunkelux 2022 1.6
    5.25% Intralot 2024 1.5
    6.50% CMA 2022 1.5

    By Credit Rating*

    Credit Rating %
    BBB 21.2
    BB 24.7
    B 34.3
    CCC+ 1.2
    Less than CCC+ 1.3
    Not Rated 5.9
    Average Credit Rating BB-

    *excluding exposures to CIS

    Currency Allocation

    Currency %
    EUR 86.3
    USD 11.8
    Others 1.9

    Asset Allocation

    Currency %
    Cash 10.0
    Bonds 86.7
    CIS/ETFs 3.3

    Sector Breakdown*

    Sector %
    Financial 23.6
    Consumer, Cyclical 14.7
    Consumer, Non-Cyclical 11.2
    Basic Materials 10.3
    Industrial 9.3
    Communications 6.6
    Energy 4.5
    Government 3.8
    Utilities 2.8

    *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 (01.04.2017-31.03.2018) 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 CALAMATTA CUSCHIERI FUND 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.