Investment Objectives
The CC Euro High Income Bond Fund Accumulator aims to maximise the total level of return for investors through investment in a diversified portfolio of Bonds. To achieve this objective, the Investment Manager invests primarily in a diversified portfolio of over 65 intermediate term, corporate & government bonds with maturities of 10 years and less.
Investor Profile
A typical investor in the CC Euro High Income Bond Fund Accumulator is:
- Seeking to accumulate wealth and save over time in a product that re-invests gross dividends automatically.
- Planning to hold their investment for the medium-to-long term so as to benefit from the compound interest effect.
Fund Rules
The Investment Manager of the CC Euro High Income Bond Fund Accumulator – EUR 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 of the fund. Some of the restrictions include:
- The fund may not invest more than 10% of its assets in the same company
- The fund may not keep more than 10% of its assets on deposit with any one credit institution. This limit may be increased to 30% in respect of deposits with an Approved Institution
- The fund may not invest more than 20% of its assets in any other other fund
- The fund may not carry out uncovered sales (naked short-selling) of securities or other financial instruments
A quick introduction to our Euro High Income Bond Fund
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)
N/A
ASSET CLASS
Bonds
MIN. INITIAL INVESTMENT
€2500
FUND TYPE
UCITS
BASE CURRENCY
EUR
RETURN (SINCE INCEPTION)*
N/A
Inception Date: 30 May 2013
ISIN: MT7000007761
Bloomberg Ticker: CALCHAR MV
Entry Charge: None
Total Expense Ratio: 1.40%
Exit Charge: None
Distribution Yield (%): N/A
Underlying Yield (%): 4.54
Distribution: N/A
Total Net Assets: € 41.46 mn
Month end NAV in EUR: 125.35
Number of Holdings: 90
Auditors: Deloitte Malta
Legal Advisor: Ganado & Associates
Custodian: Sparkasse Bank Malta p.l.c.
% of Top 10 Holdings: 25.3
Performance To Date (EUR)
Top 10 Holdings
4.0%
3.1%
2.6%
2.5%
2.5%
2.4%
2.3%
2.2%
2.0%
1.8%
Major Sector Breakdown*
Financials
12.1%
Communications
11.1%
Consumer Discretionary
10.8%
Government
6.3%
Industrials
5.2%
Materials
5.0%
Maturity Buckets*
Credit Ratings*
Risk & Reward Profile
Lower Risk
Potentialy Lower Reward
Higher Risk
Potentialy Higher Reward
Top Holdings by Country*
17.1%
13.0%
10.0%
9.0%
5.9%
5.4%
4.5%
3.5%
3.5%
2.8%
Asset Allocation
Performance History (EUR)*
YTD
-0.92%
2019
7.48%
2018
-6.45%
2017
5.32%
2016
4.96%
Annualised SinceInception*
1.88%
Currency Allocation
Risk Statistics
-0.05 (3Y)
0.23 (5Y)
8.87% (3Y)
7.21% (5Y)
Interested in this product?
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Investment Objectives
The CC Euro High Income Bond Fund Accumulator aims to maximise the total level of return for investors through investment in a diversified portfolio of Bonds. To achieve this objective, the Investment Manager invests primarily in a diversified portfolio of over 65 intermediate term, corporate & government bonds with maturities of 10 years and less.
-
Investor profile
A typical investor in the CC Euro High Income Bond Fund Accumulator is:
- Seeking to accumulate wealth and save over time in a product that re-invests gross dividends automatically.
- Planning to hold their investment for the medium-to-long term so as to benefit from the compound interest effect.
-
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
- The fund may not invest more than 10% of its assets in the same company
- The fund may not keep more than 10% of its assets on deposit with any one credit institution. This limit may be increased to 30% in respect of deposits with an Approved Institution
- The fund may not invest more than 20% of its assets in any other other fund
- The fund may not carry out uncovered sales (naked short-selling) of securities or other financial instruments
-
Commentary
November 2020
The US election saga and positive vaccine news-flow were the main drivers of the markets during the month of November. Joe Biden has been elected as the new US president and cabinet appointments, with Ms Yellen back on the fore front, seems to promise a return to policy-making normality, with closer coordination between fiscal and monetary policy. The first coronavirus vaccines are on track for international deployment within weeks on both sides of the Atlantic. This improves the prospects for a recovery in the global economy, and this has subsequently been reflected in asset prices worldwide.
An agreement between the UK and the European Union over a trade deal following the UK’s exit at the turn of the New Year remains elusive. Both sides remain pushing a hard bargain, but are steadfast in keeping the communication channels open in order to arrive to a solution sooner rather than later.
Despite the positive undertones for 2021, the immediate picture remains strained, with record virus cases in the United States, and selectively in Europe. The resultant lockdowns and social distancing measures have upended the momentum in risk assets following the announcement of the multiple vaccines and rollout plans thereof. Additionally, President Donald Trump has refused to throw in the title and is making avail of all of his legal avenues to claw onto the presidency. Despite this, the market at large expects a smooth transition come January.
Data has become a very sensitive element for market participants as it depicts the strength of the recovery, particularly in light of the current restrictions in place in the West. Despite economic data confirming that the pace of recovery stalled over the summer, we are nowhere near the levels experienced during the first lockdown.
Indeed recent data reveals that mobility in Europe has held up rather well during the second round “lighter” version of lockdown restrictions. The use of cars has been hit much less than in March/April. In addition, trucking activity in Europe seems unaffected by the re-imposed lockdowns, in contrast to what happened earlier in the year.
Data has largely reflected the mood in the marketplace and unfolded as expected. Looking at Europe’s largest economy, Germany, PMIs indicated a consistent expansion during the month of November, with Manufacturing PMI at 57.8, compared to a consensus estimate of 57.9, and a previous reading of 57.9. Services PMI were less impressive, coming in at 46, signalling a renewed contraction, compared to 49.5 in the previous month.
Meanwhile, the Euro Area’s Manufacturing PMI indicated an expansion to 53.8, slightly above expectations of 53.6, while services PMI deteriorated further to 41.7 from a previous reading of 46.9. Services are expected to remain depressed until economies open up at full capacity again.On the unemployment front, within the Eurozone area it inched downwards to 8.4% from a revised estimate of 8.5%. Moreover, consumer confidence remained stagnant, with readings coming in at -17.6. Collectively, despite some positive signs, indicators are suggesting that we are still at the very beginning of a fragile economic recovery.
Sovereign yields were conditioned by the risk-on mode with the German sovereign 10-year yield trading wider than the previous month at -0.571 compared to -0.625 at the end of last month. General sovereign rates were rangy and spread compression continued with credit tighter on both rating spectrums. These moves were more visible in peripheral sovereign debt on the prospect of further asset purchases by the European Central Bank. Portugal’s 10-year bond yield dropped below zero, temporarily joining the negative yield club.
Hybrids, both financials and non-financials, enjoyed decent total return. Primary markets were active with a flurry of new issues flooding the markets. There is still a lot of cash in the market to be invested, which should act as a strong bid for credit as an asset class.
The CC Euro High Income fund increased by 3.36 percent, underperforming the broader market, which increased 4.31 percent throughout the month of November. On a year-to-date basis, the fund is underperforming on a net basis due to the lower beta of the portfolio and the subsequent strong market recovery; albeit the volatility of the fund has been markedly lower than average resulting in a favourable Sharpe ratio. Throughout the month, the Manager continued to adjust the portfolio into attractive undervalued credit stories, primary within the AT1 space.
Going forward the Managers believe that credit markets will continue to be aided by the support of primarily monetary politicians, creating a positive technical environment. In terms of bond picking, the Managers will continue to monitor the current environment and take opportunities in attractive credit stories.
-
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)
N/A
ASSET CLASS
Bonds
MIN. INITIAL INVESTMENT
€2500
FUND TYPE
UCITS
BASE CURRENCY
EUR
RETURN (SINCE INCEPTION)*
N/A
Inception Date: 30 May 2013
ISIN: MT7000007761
Bloomberg Ticker: CALCHAR MV
Entry Charge: None
Total Expense Ratio: 1.40%
Exit Charge: None
Distribution Yield (%): N/A
Underlying Yield (%): 4.54
Distribution: N/A
Total Net Assets: € 41.46 mn
Month end NAV in EUR: 125.35
Number of Holdings: 90
Auditors: Deloitte Malta
Legal Advisor: Ganado & Associates
Custodian: Sparkasse Bank Malta p.l.c.
% of Top 10 Holdings: 25.3
Performance To Date (EUR)
Risk & Reward Profile
1234567Lower Risk
Potentialy Lower Reward
Higher Risk
Potentialy Higher Reward
Top 10 Holdings
iShares Euro Corp Large Cap4.0%
iShares Euro HY Corp3.1%
2.25% Portugal Treasury 20342.6%
6.5% CMA CGM 20222.5%
5% Nidda BondCo 20252.5%
4% Chemours Co. 20262.4%
5.25% HSBC perp.2.3%
6% Loxam SAS 20252.2%
3.5% Eircom 20262.0%
5.25% Turkey 20301.8%
Top Holdings by Country*
France17.1%
Germany13.0%
Malta10.0%
Brazil9.0%
USA5.9%
UK5.4%
Spain4.5%
Ireland3.5%
Turkey3.5%
Switzerland2.8%
*including exposures to CISMajor Sector Breakdown*
Financials
12.1%
Communications
11.1%
Consumer Discretionary
10.8%
Government
6.3%
Industrials
5.2%
Materials
5.0%
*excluding exposures to CISAsset Allocation
Cash 4.8%Bonds 862%CIS/ETFs 9.0%Maturity Buckets*
60.7%0-5 Years21.7%5-10 Years3.8%10 Years+based on the Next Call DatePerformance History (EUR)*
YTD
-0.92%
2019
7.48%
2018
-6.45%
2017
5.32%
2016
4.96%
Annualised SinceInception*
1.88%
*The Accumulator Share Class (Class A) was launched on 29 May 2013Currency Allocation
Euro 84.0%USD 16.0%Other 0.0%Risk Statistics
Sharpe Ratio-0.05 (3Y)
0.23 (5Y)
Std. Deviation8.87% (3Y)
7.21% (5Y)
-
Downloads
Commentary
November 2020
The US election saga and positive vaccine news-flow were the main drivers of the markets during the month of November. Joe Biden has been elected as the new US president and cabinet appointments, with Ms Yellen back on the fore front, seems to promise a return to policy-making normality, with closer coordination between fiscal and monetary policy. The first coronavirus vaccines are on track for international deployment within weeks on both sides of the Atlantic. This improves the prospects for a recovery in the global economy, and this has subsequently been reflected in asset prices worldwide.
An agreement between the UK and the European Union over a trade deal following the UK’s exit at the turn of the New Year remains elusive. Both sides remain pushing a hard bargain, but are steadfast in keeping the communication channels open in order to arrive to a solution sooner rather than later.
Despite the positive undertones for 2021, the immediate picture remains strained, with record virus cases in the United States, and selectively in Europe. The resultant lockdowns and social distancing measures have upended the momentum in risk assets following the announcement of the multiple vaccines and rollout plans thereof. Additionally, President Donald Trump has refused to throw in the title and is making avail of all of his legal avenues to claw onto the presidency. Despite this, the market at large expects a smooth transition come January.
Data has become a very sensitive element for market participants as it depicts the strength of the recovery, particularly in light of the current restrictions in place in the West. Despite economic data confirming that the pace of recovery stalled over the summer, we are nowhere near the levels experienced during the first lockdown.
Indeed recent data reveals that mobility in Europe has held up rather well during the second round “lighter” version of lockdown restrictions. The use of cars has been hit much less than in March/April. In addition, trucking activity in Europe seems unaffected by the re-imposed lockdowns, in contrast to what happened earlier in the year.
Data has largely reflected the mood in the marketplace and unfolded as expected. Looking at Europe’s largest economy, Germany, PMIs indicated a consistent expansion during the month of November, with Manufacturing PMI at 57.8, compared to a consensus estimate of 57.9, and a previous reading of 57.9. Services PMI were less impressive, coming in at 46, signalling a renewed contraction, compared to 49.5 in the previous month.
Meanwhile, the Euro Area’s Manufacturing PMI indicated an expansion to 53.8, slightly above expectations of 53.6, while services PMI deteriorated further to 41.7 from a previous reading of 46.9. Services are expected to remain depressed until economies open up at full capacity again.
On the unemployment front, within the Eurozone area it inched downwards to 8.4% from a revised estimate of 8.5%. Moreover, consumer confidence remained stagnant, with readings coming in at -17.6. Collectively, despite some positive signs, indicators are suggesting that we are still at the very beginning of a fragile economic recovery.
Sovereign yields were conditioned by the risk-on mode with the German sovereign 10-year yield trading wider than the previous month at -0.571 compared to -0.625 at the end of last month. General sovereign rates were rangy and spread compression continued with credit tighter on both rating spectrums. These moves were more visible in peripheral sovereign debt on the prospect of further asset purchases by the European Central Bank. Portugal’s 10-year bond yield dropped below zero, temporarily joining the negative yield club.
Hybrids, both financials and non-financials, enjoyed decent total return. Primary markets were active with a flurry of new issues flooding the markets. There is still a lot of cash in the market to be invested, which should act as a strong bid for credit as an asset class.
The CC Euro High Income fund increased by 3.36 percent, underperforming the broader market, which increased 4.31 percent throughout the month of November. On a year-to-date basis, the fund is underperforming on a net basis due to the lower beta of the portfolio and the subsequent strong market recovery; albeit the volatility of the fund has been markedly lower than average resulting in a favourable Sharpe ratio. Throughout the month, the Manager continued to adjust the portfolio into attractive undervalued credit stories, primary within the AT1 space.
Going forward the Managers believe that credit markets will continue to be aided by the support of primarily monetary politicians, creating a positive technical environment. In terms of bond picking, the Managers will continue to monitor the current environment and take opportunities in attractive credit stories.