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 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 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

Commentary

July 2019

Markets saw a mixed sentiment throughout the whole of July; uncertainties revolving around the Fed’s decision to a rate cut 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.

Apart from the Fed and the ECB’s statement at the end of the month, markets saw top U.S and Chinese trade officials meet in Shanghai for talks in a bid to end a yearlong trade war, despite low expectations for progress and combative remarks from the US President. The next round of talks are scheduled for September.

Specifically in the Eurozone area, Greece’s election proved a positive for the country as the New Democracy party rose to power; the party has promised tax cuts financed by spending cuts in an attempt to support growth. On another note, Italy has continued to avoid censure from Brussels over the capping of its deficit. This, was digested positively with Italian sovereign debt being favoured by investors as Italian yields remained attractive in the region, impacted by the specifics risks. In contrast, Brexit remains a major issue for Europe given the new Prime Minister, Boris Johnson, has already started pinching the EU. He promised that the UK will leave the EU by the end of October no matter what, which led the sterling to tumble.

From the data front, markets also saw that the Eurozone’s manufacturing PMI revised slightly higher to 46.5 in July, still signalling the sharpest deterioration in operating conditions since December 2012. The rate of decline in new orders was the second highest recorded by the survey in just over six years amid ongoing trade tensions, difficulties in the automotive industry and political uncertainties, with new export orders falling the most since November 2011. Also, output fell the most since April 2013, whilst the reduction in purchasing activity was the steepest seen since the end of 2012. Both employment and stocks of purchases fell the most in nearly six years. On the price front, input costs dropped the most since April 2016 while output charges fell for the first time in three years. Looking ahead, business sentiment was the weakest since the end of 2012. Thus, an indeed tough month to which monetary politicians will need to look closely.

In the month, European High Yield gained 0.794 percent, trading tighter than their U.S. counterparts did.

In the month of July, the Manager opted in de-risking the portfolio due to specific risks – a move to protect the year-to-date performance. In addition, the Manager opted to take a tactical allocation by opening a position in a Portuguese Republic Government Bond to benefit from possibly a more easing tone by the ECB, in addition to the possibility that the country will be upgraded or have a positive change in outlook shortly. Going forward, the Manager believes that the maintained accommodative stance by leading central banks will sustain credit markets.

A quick introduction to our Euro High Income Bond Fund

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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)*

13.7%

*View Performance History below
Inception Date: 30 May 2013
ISIN: MT7000007761
Bloomberg Ticker: CALCHAR MV
Entry Charge: None
Total Expense Ratio: 1.44%
Exit Charge: None
Distribution Yield (%): N/A
Underlying Yield (%): 4.54
Distribution: N/A
Total Net Assets: €45.2 m
Month end NAV in EUR: 123.96
Number of Holdings: 95
Auditors: Deloitte Malta
Legal Advisor: Ganado & Associates
Custodian: Sparkasse Bank Malta p.l.c.
% of Top 10 Holdings: 19.3

Performance To Date (EUR)

Top 10 Holdings

5.00% Nidda Bondco 2025
2.2%
4.125% HP Pelzer 2024
2.2%
4.00% Chemours 2026
2.1%
6.00% Loxam 2025
2.1%
5.00% Tendam 2024
2.0%
2.25% Portugal Gov'n 2034
2.0%
5.875% Selecta 2024
1.8%
7.50% Garfunkelux 2022
1.7%
7.00% Marb Bondco 2024
1.6%
6.75% Promontoria 2023
1.6%

Major Sector Breakdown*

Financials
24.8%
Consumer Staples
14.1%
Consumer Discretionary
10.2%
Industrials
9.2%
Materials
8.5%
Asset 7
Communications
6.2%
*excluding exposures to CIS

Maturity Buckets*

49.3%
0-5 Years
16.0%
5-10 Years
0.3%
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
12.5%
France
11.2%
Germany
10.2%
Spain
8.2%
Brazil
6.6%
USA
5.2%
Switzerland
4.6%
Russia
3.2%
UK
3.1%
Ireland
2.8%
*including exposures to CIS

Asset Allocation

Cash 8.9%
Bonds 85.7%
CIS/ETFs 5.3%

Performance History (EUR)*

YTD

5.30%

2018

-6.45%

2017

5.32%

2016

4.96%

2015

-0.89%

Inception*

13.70%

*The Accumulator Share Class (Class A) was launched on 29 May 2013

Currency Allocation

Euro 84.8%
USD 15.2%
Other 0.0%

Risk Statistics

Sharpe Ratio
0.94 (3Y)
0.52 (5Y)
Std. Deviation
2.73 (3Y)
3.54 (5Y)

Interested in this product?

  • 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.
    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

    • 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

    July 2019

    Markets saw a mixed sentiment throughout the whole of July; uncertainties revolving around the Fed’s decision to a rate cut 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.

    Apart from the Fed and the ECB’s statement at the end of the month, markets saw top U.S and Chinese trade officials meet in Shanghai for talks in a bid to end a yearlong trade war, despite low expectations for progress and combative remarks from the US President. The next round of talks are scheduled for September.

    Specifically in the Eurozone area, Greece’s election proved a positive for the country as the New Democracy party rose to power; the party has promised tax cuts financed by spending cuts in an attempt to support growth. On another note, Italy has continued to avoid censure from Brussels over the capping of its deficit. This, was digested positively with Italian sovereign debt being favoured by investors as Italian yields remained attractive in the region, impacted by the specifics risks. In contrast, Brexit remains a major issue for Europe given the new Prime Minister, Boris Johnson, has already started pinching the EU. He promised that the UK will leave the EU by the end of October no matter what, which led the sterling to tumble.

    From the data front, markets also saw that the Eurozone’s manufacturing PMI revised slightly higher to 46.5 in July, still signalling the sharpest deterioration in operating conditions since December 2012. The rate of decline in new orders was the second highest recorded by the survey in just over six years amid ongoing trade tensions, difficulties in the automotive industry and political uncertainties, with new export orders falling the most since November 2011. Also, output fell the most since April 2013, whilst the reduction in purchasing activity was the steepest seen since the end of 2012. Both employment and stocks of purchases fell the most in nearly six years. On the price front, input costs dropped the most since April 2016 while output charges fell for the first time in three years. Looking ahead, business sentiment was the weakest since the end of 2012. Thus, an indeed tough month to which monetary politicians will need to look closely.

    In the month, European High Yield gained 0.794 percent, trading tighter than their U.S. counterparts did.

    In the month of July, the Manager opted in de-risking the portfolio due to specific risks – a move to protect the year-to-date performance. In addition, the Manager opted to take a tactical allocation by opening a position in a Portuguese Republic Government Bond to benefit from possibly a more easing tone by the ECB, in addition to the possibility that the country will be upgraded or have a positive change in outlook shortly. Going forward, the Manager believes that the maintained accommodative stance by leading central banks will sustain credit markets.

  • 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)*

    13.7%

    *View Performance History below
    Inception Date: 30 May 2013
    ISIN: MT7000007761
    Bloomberg Ticker: CALCHAR MV
    Entry Charge: None
    Total Expense Ratio: 1.44%
    Exit Charge: None
    Distribution Yield (%): N/A
    Underlying Yield (%): 4.54
    Distribution: N/A
    Total Net Assets: €45.2 m
    Month end NAV in EUR: 123.96
    Number of Holdings: 95
    Auditors: Deloitte Malta
    Legal Advisor: Ganado & Associates
    Custodian: Sparkasse Bank Malta p.l.c.
    % of Top 10 Holdings: 19.3

    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

    5.00% Nidda Bondco 2025
    2.2%
    4.125% HP Pelzer 2024
    2.2%
    4.00% Chemours 2026
    2.1%
    6.00% Loxam 2025
    2.1%
    5.00% Tendam 2024
    2.0%
    2.25% Portugal Gov'n 2034
    2.0%
    5.875% Selecta 2024
    1.8%
    7.50% Garfunkelux 2022
    1.7%
    7.00% Marb Bondco 2024
    1.6%
    6.75% Promontoria 2023
    1.6%

    Top Holdings by Country*

    Malta
    12.5%
    France
    11.2%
    Germany
    10.2%
    Spain
    8.2%
    Brazil
    6.6%
    USA
    5.2%
    Switzerland
    4.6%
    Russia
    3.2%
    UK
    3.1%
    Ireland
    2.8%
    *including exposures to CIS

    Major Sector Breakdown*

    Financials
    24.8%
    Consumer Staples
    14.1%
    Consumer Discretionary
    10.2%
    Industrials
    9.2%
    Materials
    8.5%
    Asset 7
    Communications
    6.2%
    *excluding exposures to CIS

    Asset Allocation

    Cash 8.9%
    Bonds 85.7%
    CIS/ETFs 5.3%

    Maturity Buckets*

    49.3%
    0-5 Years
    16.0%
    5-10 Years
    0.3%
    10 Years+
    based on the Next Call Date

    Performance History (EUR)*

    YTD

    5.30%

    2018

    -6.45%

    2017

    5.32%

    2016

    4.96%

    2015

    -0.89%

    Inception*

    13.70%

    *The Accumulator Share Class (Class A) was launched on 29 May 2013

    Credit Ratings*

    Average Credit Rating: BB-
    *excluding exposures to CIS

    Currency Allocation

    Euro 84.8%
    USD 15.2%
    Other 0.0%

    Risk Statistics

    Sharpe Ratio
    0.94 (3Y)
    0.52 (5Y)
    Std. Deviation
    2.73 (3Y)
    3.54 (5Y)
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