Investment Objectives

The Fund aims to maximise the total level of return for investors through investment primarily, in a well-diversified portfolio of fixed-income investments.

Investor Profile

A typical investor in the CC Emerging Market Bond Fund would be one who is seeking to gain exposure to the Emerging Bond Market via corporate and/or sovereign bonds whilst seeking to accumulate wealth and save over time in a product that re-invests coupons received on a gross basis. Furthermore, investors in the CC Emerging Market Bond Fund are those with a medium to high tolerance to risk and who are planning to hold on to their investment for the medium-to-long term so as to benefit from the compound interest effect whilst also participating in the interest rate cycle as well as the investment cycle commensurate with an investment in Emerging Markets.

Fund Rules

The Investment Manager shall invest 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.

  • Minimum Credit Rating CCC+ (or equivalent)
  • Up to 10% in Non-Rated Bonds
  • Average Credit Quality of B- (or equivalent)
  • Emerging Market Issuers as per MSCI Emerging and Frontier
  • Up to 15% in Emerging Market Equities
  • Use of FDIs for hedging purposes only
  • No limit on exposure to CIS
  • Up to 30% in Non Emerging Market Issuers

Commentary

January 2021

Consequent to the unprecedented coronavirus pandemic which infected over a 100 million people and led to 2.2 million deaths worldwide, 2020 was a year of extraordinary challenges. Despite the efforts made by governments and central banks to mitigate the impact on the economy, through substantial monetary and fiscal stimulus packages, the global economy (as estimated by the International Monetary Fund) contracted by 3.5 per cent.

Corporate credit, hindered at the peak of the pandemic following growing concerns about their ability to service debt, recovered. Credit spreads previously witnessing substantial widening (reaching significant highs of over 1000bps), tightened, with both investment grade and high yield issuers delivering strong positive total returns. U.S. investment grade and EM high yield outperformed its European counterparts.

Contrasting the more developed economies, emerging market economies started 2021 generally on a less positive note. Coronavirus related concerns, notably; the renewed coronavirus outbreaks and logistical issues surrounding coronavirus vaccinations, weighed on investors.

From the data front in the emerging market world, China – the world’s second largest economy and one of the few to register growth for 2020, witnessed softness in its data. In January, while remaining within expansionary territory, China reported a drop for both manufacturing and services sector.

In January, China’s manufacturing PMI fell to a seven-month low of 51.5 from 53.0 in December, and lower than market expectations of 52.7. Both output and new orders rose at softer paces, while export sales shrank for the first time in six months due to a resurgence in coronavirus infections globally and ensuing movement restrictions. After broadly stabilizing in December, employment within the manufacturing sector fell. Also, manufacturers recorded the slowest accumulation in backlogs of work for eight months. Meanwhile, services PMI dropped to a nine-month low of 52.0 from 56.3 in the December 2020.

From the Latin American region, published economic data dampened Brazil’s positive run. Notably, business confidence in Brazil declined to 60.9 points in January 2021 – the lowest since August 2020 as expectations over the next six months regarding the country’s economic situation deteriorated. The recent surge in coronavirus infections, particularly in the Amazonas state which pushed hospitals in the capital Manaus to their limits, the country’s struggle with its vaccine rollout, and political tensions surrounding the need for further social spending to help struggling Brazilians is indeed worrisome.  

Meanwhile, Brazil reported a lower manufacturing PMI for the month of January, at 56.5 when compared to December’s, standing at 61.5. The first reading of 2021 pointed to the smallest expansion since June 2020. Production and new orders continued to rise solidly although at weaker rates, while export orders broadly stagnated. Employment softened to the weakest in the current seven-month sequence of expansion as corporates became increasingly cautious about their expenditures.

From a technical perspective, emerging market debt is expected to keep pace with high yield credit in developed markets, as higher yielding debt remains an attractive avenue for those investors in search of a higher yield.

In the month of January, the CC Emerging Market Bond Fund fell by -0.37 per cent, beating the benchmark by 28bps. Throughout the month the Manager continued to seek pockets of value by looking into attractive credit stories, primarily within metals and mining, energy, and financial sectors – the latter of which is domiciled in India, an economy which may present further opportunities in the near future given its macroeconomic dynamics.

Going forward, the Manager will continue to assess the EM space scenario even on the basis of further monetary policy actions taken by Central Banks, which seem to follow the Fed’s accommodative stance.

Key Facts & Performance

Fund Manager

Jordan Portelli

Jordan is an Investment Manager at Calamatta Cuschieri and is the Head of the Fixed Income desk. Jordan has over 10 years’ experience in High Yield debt. He is a member on a number of Investment Committees and is also a member on the House View Committee of Calamatta Cuschieri. He obtained a Diploma in Business and Management from Cambridge College in the U.K. He also obtained his BSc (Hons) in Economics from the London School of Economics.

PRICE (EUR)

ASSET CLASS

Bonds

MIN. INITIAL INVESTMENT

€2500

FUND TYPE

UCITS

BASE CURRENCY

EUR

RETURN (SINCE INCEPTION)*

-8.60%

*View Performance History below
Inception Date: 02 Nov 2017
ISIN: MT7000021259
Bloomberg Ticker: CCEMBFD MV
Entry Charge: Up to 2.5%
Total Expense Ratio: 2.07%
Exit Charge: None
Distribution Yield (%): 4.25
Underlying Yield (%): 0.00
Distribution: 31/03 and 30/09
Total Net Assets: $13.4 mn
Month end NAV in EUR: 81.56
Number of Holdings: 44
Auditors: Deloitte Malta
Legal Advisor: Ganado Advocates
Custodian: Sparkasse Bank Malta p.l.c.
% of Top 10 Holdings: 35.3

Performance To Date (EUR)

Top 10 Holdings

iShares JPM EM Bond Fund
6.1%
iShares JPM USD EM Corp Bond
5.7%
6.5% Global Ports Finance 2023
3.3%
5.45% Cemex 2029
3.2%
5.8% Turkcell 2028
3.2%
4.95% Veon Holdings 2024
3.2%
6.625% TUPY Overseas SA 2024
3.0%
6.625% NBM Holdings 2029
2.6%
8.125% Global Liman 2021
2.5%
5.299% Petrobras Global 2025
2.5%

Major Sector Breakdown*

Government
15.6%
Asset 7
Communications
11.2%
Real Estate
8.6%
Industrials
6.8%
Materials
5.1%
Health Care
4.7%
*excluding exposures to CIS

Maturity Buckets*

45.4%
0-5 Years
26.0%
5-10 Years
6.6%
10 Years+
*based on the Next Call Date

Credit Ratings*

Average Credit Rating: BB
*excluding exposures to CIS

Risk & Reward Profile

1
2
3
4
5
6
7
Lower Risk

Potentialy Lower Reward

Higher Risk

Potentialy Higher Reward

Top Holdings by Country*

Malta (incl. Cash)
22.0%
Brazil
17.8%
China
11.2%
Turkey
7.4%
Mexico
7.3%
Russia
6.5%
India
5.1%
Germany
4.6%
Oman
3.9%
Netherlands
3.2%
*including exposures to CIS, using look-through

Asset Allocation

Cash 10.3%
Bonds (incl. ETFs) 89.7%
Equities (incl. ETFs) 0.0%

Performance History (EUR)*

YTD

-0.45%

2020

-3.75%

2019

6.55%

1-month

-0.45%

3-month

4.30%

Annualised Since Inception***

-2.73%

*Data in the chart does not include any dividends distributed since the Fund was launched on 03 November 2017.
**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 EUR Distributor Share Class (Class D) was launched on 03 November 2017.

Currency Allocation

USD 90.8%
Euro 9.2%
Other 0.0%
Data for risk statistics is not available for this fund.

Interested in this product?

  • Investment Objectives

    The Fund aims to maximise the total level of return for investors through investment primarily, in a well-diversified portfolio of fixed-income investments.

  • Investor profile

    A typical investor in the CC Emerging Market Bond Fund would be one who is seeking to gain exposure to the Emerging Bond Market via corporate and/or sovereign bonds whilst seeking to accumulate wealth and save over time in a product that re-invests coupons received on a gross basis. Furthermore, investors in the CC Emerging Market Bond Fund are those with a medium to high tolerance to risk and who are planning to hold on to their investment for the medium-to-long term so as to benefit from the compound interest effect whilst also participating in the interest rate cycle as well as the investment cycle commensurate with an investment in Emerging Markets.

    Investor Profile Icon
  • Fund Rules

    The Investment Manager of the CC High Income Bond Funds – EUR and USD has the duty to ensure that the underlying investments of the funds are well diversified. According to the prospectus, the investment manager has to abide by a number of investment restrictions to safeguard the value of the assets

    • Minimum Credit Rating CCC+ (or equivalent)
    • Up to 10% in Non-Rated Bonds
    • Average Credit Quality of B- (or equivalent)
    • Emerging Market Issuers as per MSCI Emerging and Frontier
    • Up to 15% in Emerging Market Equities
    • Use of FDIs for hedging purposes only
    • No limit on exposure to CIS
    • Up to 30% in Non Emerging Market Issuers
  • Commentary

    January 2021

    Consequent to the unprecedented coronavirus pandemic which infected over a 100 million people and led to 2.2 million deaths worldwide, 2020 was a year of extraordinary challenges. Despite the efforts made by governments and central banks to mitigate the impact on the economy, through substantial monetary and fiscal stimulus packages, the global economy (as estimated by the International Monetary Fund) contracted by 3.5 per cent.

    Corporate credit, hindered at the peak of the pandemic following growing concerns about their ability to service debt, recovered. Credit spreads previously witnessing substantial widening (reaching significant highs of over 1000bps), tightened, with both investment grade and high yield issuers delivering strong positive total returns. U.S. investment grade and EM high yield outperformed its European counterparts.

    Contrasting the more developed economies, emerging market economies started 2021 generally on a less positive note. Coronavirus related concerns, notably; the renewed coronavirus outbreaks and logistical issues surrounding coronavirus vaccinations, weighed on investors.

    From the data front in the emerging market world, China – the world’s second largest economy and one of the few to register growth for 2020, witnessed softness in its data. In January, while remaining within expansionary territory, China reported a drop for both manufacturing and services sector.

    In January, China’s manufacturing PMI fell to a seven-month low of 51.5 from 53.0 in December, and lower than market expectations of 52.7. Both output and new orders rose at softer paces, while export sales shrank for the first time in six months due to a resurgence in coronavirus infections globally and ensuing movement restrictions. After broadly stabilizing in December, employment within the manufacturing sector fell. Also, manufacturers recorded the slowest accumulation in backlogs of work for eight months. Meanwhile, services PMI dropped to a nine-month low of 52.0 from 56.3 in the December 2020.

    From the Latin American region, published economic data dampened Brazil’s positive run. Notably, business confidence in Brazil declined to 60.9 points in January 2021 – the lowest since August 2020 as expectations over the next six months regarding the country’s economic situation deteriorated. The recent surge in coronavirus infections, particularly in the Amazonas state which pushed hospitals in the capital Manaus to their limits, the country’s struggle with its vaccine rollout, and political tensions surrounding the need for further social spending to help struggling Brazilians is indeed worrisome.  

    Meanwhile, Brazil reported a lower manufacturing PMI for the month of January, at 56.5 when compared to December’s, standing at 61.5. The first reading of 2021 pointed to the smallest expansion since June 2020. Production and new orders continued to rise solidly although at weaker rates, while export orders broadly stagnated. Employment softened to the weakest in the current seven-month sequence of expansion as corporates became increasingly cautious about their expenditures.

    From a technical perspective, emerging market debt is expected to keep pace with high yield credit in developed markets, as higher yielding debt remains an attractive avenue for those investors in search of a higher yield.

    In the month of January, the CC Emerging Market Bond Fund fell by -0.37 per cent, beating the benchmark by 28bps. Throughout the month the Manager continued to seek pockets of value by looking into attractive credit stories, primarily within metals and mining, energy, and financial sectors – the latter of which is domiciled in India, an economy which may present further opportunities in the near future given its macroeconomic dynamics.

    Going forward, the Manager will continue to assess the EM space scenario even on the basis of further monetary policy actions taken by Central Banks, which seem to follow the Fed’s accommodative stance.

  • Key facts & performance

    Fund Manager

    Jordan Portelli

    Jordan is an Investment Manager at Calamatta Cuschieri and is the Head of the Fixed Income desk. Jordan has over 10 years’ experience in High Yield debt. He is a member on a number of Investment Committees and is also a member on the House View Committee of Calamatta Cuschieri. He obtained a Diploma in Business and Management from Cambridge College in the U.K. He also obtained his BSc (Hons) in Economics from the London School of Economics.

    PRICE (EUR)

    ASSET CLASS

    Bonds

    MIN. INITIAL INVESTMENT

    €2500

    FUND TYPE

    UCITS

    BASE CURRENCY

    EUR

    RETURN (SINCE INCEPTION)*

    -8.60%

    *View Performance History below
    Inception Date: 02 Nov 2017
    ISIN: MT7000021259
    Bloomberg Ticker: CCEMBFD MV
    Entry Charge: Up to 2.5%
    Total Expense Ratio: 2.07%
    Exit Charge: None
    Distribution Yield (%): 4.25
    Underlying Yield (%): 0.00
    Distribution: 31/03 and 30/09
    Total Net Assets: $13.4 mn
    Month end NAV in EUR: 81.56
    Number of Holdings: 44
    Auditors: Deloitte Malta
    Legal Advisor: Ganado Advocates
    Custodian: Sparkasse Bank Malta p.l.c.
    % of Top 10 Holdings: 35.3

    Performance To Date (EUR)

    Risk & Reward Profile

    1
    2
    3
    4
    5
    6
    7
    Lower Risk

    Potentialy Lower Reward

    Higher Risk

    Potentialy Higher Reward

    Top 10 Holdings

    iShares JPM EM Bond Fund
    6.1%
    iShares JPM USD EM Corp Bond
    5.7%
    6.5% Global Ports Finance 2023
    3.3%
    5.45% Cemex 2029
    3.2%
    5.8% Turkcell 2028
    3.2%
    4.95% Veon Holdings 2024
    3.2%
    6.625% TUPY Overseas SA 2024
    3.0%
    6.625% NBM Holdings 2029
    2.6%
    8.125% Global Liman 2021
    2.5%
    5.299% Petrobras Global 2025
    2.5%

    Top Holdings by Country*

    Malta (incl. Cash)
    22.0%
    Brazil
    17.8%
    China
    11.2%
    Turkey
    7.4%
    Mexico
    7.3%
    Russia
    6.5%
    India
    5.1%
    Germany
    4.6%
    Oman
    3.9%
    Netherlands
    3.2%
    *including exposures to CIS, using look-through

    Major Sector Breakdown*

    Government
    15.6%
    Asset 7
    Communications
    11.2%
    Real Estate
    8.6%
    Industrials
    6.8%
    Materials
    5.1%
    Health Care
    4.7%
    *excluding exposures to CIS

    Asset Allocation

    Cash 10.3%
    Bonds (incl. ETFs) 89.7%
    Equities (incl. ETFs) 0.0%

    Maturity Buckets*

    45.4%
    0-5 Years
    26.0%
    5-10 Years
    6.6%
    10 Years+
    *based on the Next Call Date

    Performance History (EUR)*

    YTD

    -0.45%

    2020

    -3.75%

    2019

    6.55%

    1-month

    -0.45%

    3-month

    4.30%

    Annualised Since Inception***

    -2.73%

    *Data in the chart does not include any dividends distributed since the Fund was launched on 03 November 2017.
    **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 EUR Distributor Share Class (Class D) was launched on 03 November 2017.

    Credit Ratings*

    Average Credit Rating: BB
    *excluding exposures to CIS

    Currency Allocation

    USD 90.8%
    Euro 9.2%
    Other 0.0%
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