Global Balanced Income Fund

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 assets 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.

The Fund is actively managed, not managed by reference to any index.

The Fund is classified under Article 6 of the SFDR meaning that the investments underlying this financial product do not take into account the EU criteria for environmentally sustainable economic activities.

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

• We shall invest primarily in a diversified portfolio of listed transferable securities across a wide spectrum of industries and sectors primarily via bonds, equities and eligible ETFs. We may invest in these asset classes either directly or indirectly through UCITS Funds and/ or eligible non UCITS Funds
• We intend to diversify the assets of the Sub-Fund broadly among countries, industries and sectors, but reserve the right to invest a substantial portion of the Sub-Fund’s assets in one or more countries (or regions) if economic and business conditions warrant such investments
• Investments in equity securities may include, but are not limited to, dividend-paying securities, equities, ETFs and preferred shares of global issuers. At our discretion, we may also invest indirectly in equities and equity-related instruments through the use of collective investment schemes. The Sub-Fund will generally, but not exclusively, invest in blue chip issuers listed on Approved Regulated Markets, including equities listed on the Malta Stock Exchange, where applicable
• We shall manage the credit risk and will aim to manage interest rate risk through credit analysis and credit diversity. We may invest in both investment grade (corporate and sovereign) and high yield bonds that have a credit rating of at least “B-” by S&P (or rating equivalent issued by other reputable rating agencies) at the time of investment, provided that the Sub-Fund may invest a maximum of 10% of its assets in non-rated debt securities, including those listed on the Malta Stock Exchange. We will, at all times, maintain an exposure to direct rated bonds, whether investment grade or high yield, of at least 25% of the value of the Sub-Fund
• For temporary or defensive purposes, the Sub-Fund may invest in short-term fixed income instruments, money market funds, cash and cash equivalents. The Sub-Fund may also hold cash and cash equivalents on an ancillary basis or cash management purposes, pending investment in accordance with its Investment Policy and to meet operating expenses and redemption requests.The Sub-Fund may invest in Real Estate Investment Trusts (“REITs”) via UCITS-eligible ETFs and/or CIS and securities related to real assets (including but not limited to real estate, agriculture, and precious metals-related securities) such as equities, bonds, and ETFs as well as CISs as long as these constitute eligible assets under the UCITS Directive
• The Sub-Fund may invest in options, futures and forwards for risk management and hedging purposes only (“Hedging Instruments”)
• Other than any margins required for these Hedging Instruments, the Sub-Fund will not employ leverage

November 2025

Introduction

In November, global financial markets were confronted with a more demanding backdrop. The month began with a broad-based sell-off, sparked by intensifying concerns that AI-related capital expenditures—many of them debt-financed—may prove overly ambitious and deliver diminishing marginal returns. This shift in sentiment pushed global equities sharply lower, with weakness spreading from mega-cap technology leaders into the wider market. In contrast, government bonds—particularly higher quality segments—acted as the main stabilising force, supported by expectations that the Federal Reserve may be approaching another policy-rate reduction in December. At the same time, cryptoassets posted one of their weakest monthly performances in recent years, experiencing persistent outflows, pronounced declines in Bitcoin, and visible spillovers into listed risk-on assets—where liquidity constraints resurfaced in a manner reminiscent of the elevated volatility seen in August 2024. U.S. diplomatic efforts included advancing a revised peace framework for Ukraine, while also signalling the potential for targeted military action against Venezuela in the context of operations against organised crime and drug-trafficking networks. Overall, investors navigated a more complex and less predictable risk environment. Taken together, while headline asset prices may still convey an appearance of stability, the accumulation of idiosyncratic and structural risks underscores the importance of maintaining elevated liquidity buffers, prioritising strong balance sheets, and ensuring meaningful portfolio diversification.

On the monetary-policy front, the Federal Reserve did not convene for a rate decision in November, leaving markets without clear guidance on whether another reduction will follow in December. Minutes from the prior meeting indicated a divided committee, and the absence of key economic releases—particularly the missing labour-market data for October and November—creates an additional hurdle for policymakers. In this context, Fed officials are likely to err on the side of caution before committing to further easing. In Europe, the ECB maintained its current policy rate, consistent with a measured and data-dependent stance aimed at preserving financial stability while closely monitoring inflation dynamics. Market participants generally expect the ECB to keep rates unchanged well into 2026, as euro-area inflation continues to converge toward target and economic activity shows pockets of resilience despite a challenging global environment.

November reintroduced volatility into global markets, offering a timely test of whether the prevailing “buy-the-dip” mentality continues to anchor investor behaviour. This pattern—entrenched in the post-pandemic era—has increasingly become a proxy for the growing influence of retail participants in global equity markets. From the rise of “meme stocks” and “HODL” culture, individual investors have demonstrated remarkable resilience. They have participated in, and often amplified, the impressive equity returns of the past five years, showing little capitulation even during the widespread sell-off of 2022. Whenever markets appear on the verge of a more sustained downturn, retail flows have stepped in to support market leaders (notably the “Magnificent 7”) as well as more speculative, unprofitable business models trading at elevated valuations. At the same time, retail investors have played a central role in elevating entirely new asset classes—most notably cryptocurrencies—from fringe concepts to instruments with institutional relevance, while also transforming liquidity dynamics in short-dated options markets. Platforms such as Robinhood and Coinbase have become emblematic of this structural shift. According to some estimates, retail investors now account for roughly 20% of all U.S. equity trading volume, with approximately 9% of value traded occurring outside regular market hours. Their presence now constitutes a meaningful and persistent force—far removed from the earlier stereotype of retail activity signalling market tops. Supported by near-zero trading costs, real-time platforms, and increasingly sophisticated data analytics, retail participation has reshaped the structure and behaviour of equity markets. In this context, traditional market assessments based on historical averages—particularly valuation metrics anchored in past cycles—may hold diminishing relevance.

Market Environment and Performance

In the Euro area, business activity continued to strengthen through the year, with the HCOB Eurozone Composite PMI coming in at 52.4 from 52.5 in October, broadly in line with market expectations. The reading indicates another solid monthly increase in business activity, marking one of the strongest expansions in the past two and a half years. Growth continued being driven by the services sector, which posted its fastest rise in output in 18 months, while manufacturing activity expanded only marginally. Consumer price inflation held at 2.1% in October, slightly down from the 2.2% level recorded in September, and close to the European Central Bank’s 2% target.

In the U.S., official data releases were severely disrupted by the recent federal government shutdown, which caused major agencies to suspend or delay their standard reporting. Forward-looking indicators point to continued momentum in Q4. The Composite PMI rose to 54.8 in November, up from 54.6 in October and above market expectations. The reading marked the highest level since July, pointing to an acceleration in economic growth as of late.  Services expanded at their fastest pace since July, while manufacturing output remained solid. With regards to inflation, the Bureau of Labour Statistics cancelled the October 2025 CPI release due to disruptions from the government shutdown, leaving no official CPI or core CPI reading for the month.

Looking at credit markets, in the U.S., Treasury yields were volatile as investor sentiment shifted between optimism and caution over future rate cuts. By month-end, markets were pricing in a 25bps cut in December. Corporate credit delivered mixed results: U.S. investment-grade bonds gained 0.61%, while European investment-grade credit posted negative returns. In high yield, U.S. issuers returned 0.46%, outperforming European high-yield credit, which delivered a modest 0.06% for the month.

Fund performance

In the month of November, the Global Balanced Income Fund registered a loss of 1.90%. On the fixed income allocation, the Fund’s holdings remained unchanged during the month, as the Manager deemed the portfolio appropriately positioned to navigate the current market momentum. On the equity allocation, the Fund’s positioning has been reviewed and adjusted to align with prevailing market sentiment. A new position in BNP Paribas has been established, while the exposure to Meta Platforms has been increased. At the same time, the fund has exited its position in Mercedes-Benz Group AG for risk management purposes.

Market and investment outlook

Looking ahead, the Manager notes that the macroeconomic environment continues to deliver mixed and often contradictory signals regarding global growth momentum. In the U.S, inflation remains persistently elevated despite clear signs of labour-market cooling, while in Europe even the most optimistic scenarios point only to modest expansion. As a result, expectations for monetary easing are gradually drifting away from prevailing market assumptions, thereby adding an additional layer of uncertainty to the 2026 economic outlook. Geopolitical developments—which until recently held the promise of a potential tailwind through progress towards peace in Ukraine—have instead shifted in a less constructive direction, with rising risks of escalation in Venezuela further clouding the global backdrop. The recent resurgence in energy prices, driven predominantly by supply-side constraints, compounds these headwinds. Taken together, the likelihood of a broad-based and durable macroeconomic recovery over the medium term appears limited. Credit markets are reflective on the interest rate trajectory and to this end if inflation in Europe faces a downward trend we do not exclude that the ECB will contemplate further rate cuts. In the U.S. we expect further easing which is overall a positive.

From the equity front, the Manager maintains a prudent stance. While recent equity-market volatility remains well within long-term statistical norms, it may nonetheless signal emerging pockets of stress among certain market participants. Consequently, portfolio positioning will continue to focus on high-quality companies with durable competitive advantages and secular growth drivers that are less dependent on cyclical dynamics. Beyond the customary year-end momentum, maintaining flexibility in strategic asset allocation remains essential to adapt to evolving market conditions.