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.

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

July 2019

Markets saw a mixed sentiment throughout the whole of July; uncertainties revolving around the Fed’s decision to a cut rates along with ECB’s Mario Draghi hinting at easing were the stars of the month. Needless to say, investors were seen to take a cautious approach during the month after the rally seen in the month of June. By the end of July, the Fed cut rates by 25bps, a move which was not digested positively by markets that expected a more aggressive stance. On the other hand, Mario Draghi left rates unchanged, however indicated that the downward trend in data will be monitored and easing actions will be taken if deemed necessary.

In the Emerging Market world, Turkey’s consumer inflation slowed to its lowest level in June due to a high base effect from the prior year and a drop in food prices. This potentially led Turkey’s central bank to sharply cut its key interest rates by a more than expected, 425bps after the central bank governor was fired.

We also saw China’s factory activity shrink for the third month in a row in July and Q2 GDP was the weakest data seen in 27 years, underlining the growing strains placed on the world’s second largest economy. In addition, China‘s June surplus widened to USD 50.98 billion from USD 40.91 billion as exports fell by 1.3 percent, while imports decreased at a faster pace of 7.3 percent. In the month of July, tables turned as the U.S economy improved and the Chinese economy deteriorated. That being said, the People’s Bank of China (PBOC) has finally started to ease monetary policy conditions for consumers and businesses. In order to maintain growth following the U.S tariffs, the PBOC produced a coordinated response in the form of liquidity stimulus and fiscal measures. To underline its easing bias, the PBOC provided another 100bps cut to its reserve requirement ratio, injecting further liquidity.

The emerging market that outshined during the month of July was Brazil especially due to the news that the government plans to go ahead with the pension reform that could result savings amounting to USD 900 billion. Trump has also offered Brazil the chance to negotiate a free trade deal that the country was keen on accepting. In addition to, Brazil’s poultry exports increased by 64 percent in June and hence, revenue increased by 76.6 percent year-on-year. This resulted in a positive for the Brazilian names our fund holds.

Furthermore, in anticipation of the Fed’s rate cut, emerging market countries followed the steps of the Fed and cut rates. The Central Bank of Russia, South Korea’s central bank and the Bank of Indonesia all cut their rates by 25bps and hinted that more cuts were likely this year. The Reserve Bank of India also hinted that markets should see a series of rate cuts equivalent to 100bps depending on the economic data produced.

In the month, Emerging markets saw a 1 percent gain in the month of July, once again beating European High Yield and U.S High Yield. Emerging markets have shown more resilience to the ongoing trade war uncertainties due to reporting overall positive economic data from various EMs, in addition to a relatively stable dollar currency.

The Manager believes that emerging market valuations possibly still offer value. However, the Manager in the month opted in de-risking the portfolio from specifics, while it opted to seek value in other geographical regions in which the Manager believed there is value, with the likes of CSN that benefitted from iron ore prices.

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 (USD)

$

ASSET CLASS

Bonds

MIN. INITIAL INVESTMENT

$3000

FUND TYPE

UCITS

BASE CURRENCY

USD

RETURN (SINCE INCEPTION)*

1.04%

*View Performance History below
Inception Date: 02 Nov 2017
ISIN: MT7000021226
Bloomberg Ticker: CCEMBFA MV
Entry Charge: Up to 2.5%
Total Expense Ratio: 2.02%
Exit Charge: None
Distribution Yield (%): N/A
Underlying Yield (%): 3.89
Distribution: N/A
Total Net Assets: $11.1 m
Month end NAV in USD: 101.04
Number of Holdings: 40
Auditors: Deloitte Malta
Legal Advisor: Ganado Advocates
Custodian: Sparkasse Bank Malta p.l.c.
% of Top 10 Holdings: 36.5

Performance To Date (USD)

Top 10 Holdings

5.299% Petrobras 2025
4.4%
6.50% Global Ports 2023
3.9%
4.95% Veon Holdings 2024
3.8%
4.95% Gazprom Capital 2022
3.8%
7.25% JBS 2024
3.7%
6.625% Tupy Overseas 2024
3.7%
8.125% Global Liman 2021
3.6%
6.95% Moderland 2024
3.5%
6.90% Yestar Healthcare 2021
3.1%
5.00% Nidda 2025
3.0%

Major Sector Breakdown*

Consumer Staples
19.6%
Asset 7
Communications
13.1%
Government
13.0%
Financials
11.6%
Energy
10.9%
Consumer Discretionary
9.1%
*excluding exposures to CIS

Maturity Buckets*

68.6%
0-5 Years
10.6%
5-10 Years
7.5%
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*

Brazil
15.7%
Malta (incl. cash)
11.8%
China
11.6%
Russia
11.4%
Turkey
8.9%
Indonesia
8.8%
Netherlands
3.8%
United States
3.8%
Mexico
3.7%
Argentina
3.5%
*including exposures to CIS, using look-through

Asset Allocation

Cash 11.1%
Bonds (incl. ETFs) 86.7%
Equities (incl. ETFs) 2.2%

Performance History (EUR)*

YTD

7.91%

2018

-6.17%

2017*

-0.21%

1-month

-0.05%

3-month

1.92%

Inception*

1.04%

*The USD Accumulator Share Class (Class A) was launched on 03 November 2017.

Currency Allocation

USD 93.6%
Euro 6.4%
TRY 0.0%
Data for risk statistics is not available for this fund.

Interested in this product?

  • 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.

  • 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

    July 2019

    Markets saw a mixed sentiment throughout the whole of July; uncertainties revolving around the Fed’s decision to a cut rates along with ECB’s Mario Draghi hinting at easing were the stars of the month. Needless to say, investors were seen to take a cautious approach during the month after the rally seen in the month of June. By the end of July, the Fed cut rates by 25bps, a move which was not digested positively by markets that expected a more aggressive stance. On the other hand, Mario Draghi left rates unchanged, however indicated that the downward trend in data will be monitored and easing actions will be taken if deemed necessary.

    In the Emerging Market world, Turkey’s consumer inflation slowed to its lowest level in June due to a high base effect from the prior year and a drop in food prices. This potentially led Turkey’s central bank to sharply cut its key interest rates by a more than expected, 425bps after the central bank governor was fired.

    We also saw China’s factory activity shrink for the third month in a row in July and Q2 GDP was the weakest data seen in 27 years, underlining the growing strains placed on the world’s second largest economy. In addition, China‘s June surplus widened to USD 50.98 billion from USD 40.91 billion as exports fell by 1.3 percent, while imports decreased at a faster pace of 7.3 percent. In the month of July, tables turned as the U.S economy improved and the Chinese economy deteriorated. That being said, the People’s Bank of China (PBOC) has finally started to ease monetary policy conditions for consumers and businesses. In order to maintain growth following the U.S tariffs, the PBOC produced a coordinated response in the form of liquidity stimulus and fiscal measures. To underline its easing bias, the PBOC provided another 100bps cut to its reserve requirement ratio, injecting further liquidity.

    The emerging market that outshined during the month of July was Brazil especially due to the news that the government plans to go ahead with the pension reform that could result savings amounting to USD 900 billion. Trump has also offered Brazil the chance to negotiate a free trade deal that the country was keen on accepting. In addition to, Brazil’s poultry exports increased by 64 percent in June and hence, revenue increased by 76.6 percent year-on-year. This resulted in a positive for the Brazilian names our fund holds.

    Furthermore, in anticipation of the Fed’s rate cut, emerging market countries followed the steps of the Fed and cut rates. The Central Bank of Russia, South Korea’s central bank and the Bank of Indonesia all cut their rates by 25bps and hinted that more cuts were likely this year. The Reserve Bank of India also hinted that markets should see a series of rate cuts equivalent to 100bps depending on the economic data produced.

    In the month, Emerging markets saw a 1 percent gain in the month of July, once again beating European High Yield and U.S High Yield. Emerging markets have shown more resilience to the ongoing trade war uncertainties due to reporting overall positive economic data from various EMs, in addition to a relatively stable dollar currency.

    The Manager believes that emerging market valuations possibly still offer value. However, the Manager in the month opted in de-risking the portfolio from specifics, while it opted to seek value in other geographical regions in which the Manager believed there is value, with the likes of CSN that benefitted from iron ore prices.

  • 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 (USD)

    $

    ASSET CLASS

    Bonds

    MIN. INITIAL INVESTMENT

    $3000

    FUND TYPE

    UCITS

    BASE CURRENCY

    USD

    RETURN (SINCE INCEPTION)*

    1.04%

    *View Performance History below
    Inception Date: 02 Nov 2017
    ISIN: MT7000021226
    Bloomberg Ticker: CCEMBFA MV
    Entry Charge: Up to 2.5%
    Total Expense Ratio: 2.02%
    Exit Charge: None
    Distribution Yield (%): N/A
    Underlying Yield (%): 3.89
    Distribution: N/A
    Total Net Assets: $11.1 m
    Month end NAV in USD: 101.04
    Number of Holdings: 40
    Auditors: Deloitte Malta
    Legal Advisor: Ganado Advocates
    Custodian: Sparkasse Bank Malta p.l.c.
    % of Top 10 Holdings: 36.5

    Performance To Date (USD)

    Risk & Reward Profile

    1
    2
    3
    4
    5
    6
    7
    Lower Risk

    Potentialy Lower Reward

    Higher Risk

    Potentialy Higher Reward

    Top 10 Holdings

    5.299% Petrobras 2025
    4.4%
    6.50% Global Ports 2023
    3.9%
    4.95% Veon Holdings 2024
    3.8%
    4.95% Gazprom Capital 2022
    3.8%
    7.25% JBS 2024
    3.7%
    6.625% Tupy Overseas 2024
    3.7%
    8.125% Global Liman 2021
    3.6%
    6.95% Moderland 2024
    3.5%
    6.90% Yestar Healthcare 2021
    3.1%
    5.00% Nidda 2025
    3.0%

    Top Holdings by Country*

    Brazil
    15.7%
    Malta (incl. cash)
    11.8%
    China
    11.6%
    Russia
    11.4%
    Turkey
    8.9%
    Indonesia
    8.8%
    Netherlands
    3.8%
    United States
    3.8%
    Mexico
    3.7%
    Argentina
    3.5%
    *including exposures to CIS, using look-through

    Major Sector Breakdown*

    Consumer Staples
    19.6%
    Asset 7
    Communications
    13.1%
    Government
    13.0%
    Financials
    11.6%
    Energy
    10.9%
    Consumer Discretionary
    9.1%
    *excluding exposures to CIS

    Asset Allocation

    Cash 11.1%
    Bonds (incl. ETFs) 86.7%
    Equities (incl. ETFs) 2.2%

    Maturity Buckets*

    68.6%
    0-5 Years
    10.6%
    5-10 Years
    7.5%
    10 Years+
    *based on the Next Call Date

    Performance History (EUR)*

    YTD

    7.91%

    2018

    -6.17%

    2017*

    -0.21%

    1-month

    -0.05%

    3-month

    1.92%

    Inception*

    1.04%

    *The USD Accumulator Share Class (Class A) was launched on 03 November 2017.

    Credit Ratings*

    Average Credit Rating: BB
    *excluding exposures to CIS

    Currency Allocation

    USD 93.6%
    Euro 6.4%
    TRY 0.0%
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