Investment Objectives

The CC 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 High Income Funds 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 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

January 2019

The long awaited boost in markets occurred in January; the dovish approach taken by both the Federal Reserve (Fed) and the European Central Bank (ECB) allowed markets to have a positive retracement. Indeed, credit markets were in need of some sort of comfort being from a monetary aspect or from the geopolitical front following a negative 2018. In fact, markets applauded the dovish stance amid concerns of slow global growth and geopolitical uncertainty.

Latest data from China continued to display signs of softness specifically inflation being less than expected, while manufacturing activity contracted for the second time in January. In this regard, we should continue to see further stimulus from the fiscal and monetary front. Other regions have also showed weakness with Germany facing the consequences of the Trade War. This was witnessed in the latest industrial figures that registered its worst performance in more than 5 years.

Moreover, Brexit and Italy are other uncertainties for 2019. The latter was dragged into a recession with uncertainty increasing due to the very unpopular economic measures being implemented by the populist government, which are however seen to be very welcomed by southern Italy citizens.

A positive for credit markets in January was the Fed’s dovish tone with the market now pricing no interest rate hikes for 2019.This led to a tighter U.S. Treasury Curve and a weaker dollar. Furthermore, the ECB also softened its tone on the back of geopolitical issues.

For 2019, we are more constructive given the recent supporting monetary stance, which should be a positive trigger for HY debt. In the month of January, the fund outperformed the market as the Managers opted in dipping into credit that was harshly impacted in 2018. The Managers will continue to seek value in credit stories with attractive valuations and adjust the cash levels accordingly.

A quick introduction to our High Income Bond Fund.

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Key Facts & Performance

Fund Manager

Mark Vella

Mark Vella is an Investment Manager at Calamatta Cuschieri with over 10 years' experience. He specialises in Fixed Income where his main responsibilities include co-managing the fixed income segment of discretionary portfolios. He is a member on a number of Investment Committees. He is a regular contributor to the Times of Malta Online. He graduated with honours in Banking & Finance from the University of Malta.

PRICE (USD)

$

ASSET CLASS

Bonds

MIN. INITIAL INVESTMENT

$3000

FUND TYPE

UCITS

BASE CURRENCY

USD

RETURN (SINCE INCEPTION)*

14.07%

*View Performance History below
Inception Date: 30 May 2013
ISIN: MT7000007753
Bloomberg Ticker: CALCHIA MV
Entry Charge: Up to 2.5%
Total Expense Ratio: 1.47%
Exit Charge: None
Distribution Yield (%): N/A
Underlying Yield (%): 5.22
Distribution: N/A
Total Net Assets: $17.8 m
Month and NAV in USD: 119.52
Number of Holdings: 51
Auditors: Deloitte Malta
Legal Advisor: Ganado & Associates
Custodian: Sparkasse Bank Malta p.l.c.
% of Top 10 Holdings: 26.2

Performance To Date (USD)

Top 10 Holdings

5.625% Ineos 2024
3.7%
7.00% KB Home 2021
3.5%
5.375% Petrobras 202
2.8%
4.75% Lennar 2022
2.8%
6.25% IGT 2022
2.3%
7.25% JBS 2024
2.3%
6.25% GTH Finance 2020
2.2%
6.00% Icahn Ent. 2020
2.2%
5.25% Sberbank 2023
2.2%
5.299% Petrobras 2025
2.2%

Major Sector Breakdown*

Financials
28.2%
Consumer Discretionary
14.1%
Materials
13.5%
Asset 7
Communications
10.6%
Energy
10.1%
Consumer Staples
8.7%
*excluding exposures to CIS

Maturity Buckets*

70.0%
0-5 Years
16.4%
5-10 Years
2.5%
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*

USA
19.1%
Russia
15.0%
Brazil
13.6%
UK
9.2%
Turkey
4.1%
Indonesia
4.0%
China
3.6%
Switzerland
2.8%
France
2.1%
Italy
2.0%
*including exposures to CIS

Asset Allocation

Cash 8.1%
Bonds 90.2%
CIS/ETFs 1.7%

Performance History (EUR)*

YTD

2.44%

2018

-3.22%

2017

-2.59%

2016

1.00%

2015

-2.59%

Inception*

14.07%

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

Currency Allocation

USD 100.0%
Other 0.0%

Risk Statistics

Sharpe Ratio
0.90 (3Y)
0.00 (5Y)
Std. Deviation
3.21 (3Y)
3.56 (5Y)

Interested in this product?

  • Investment Objectives

    The CC 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 High Income Funds 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

    January 2019

    The long awaited boost in markets occurred in January; the dovish approach taken by both the Federal Reserve (Fed) and the European Central Bank (ECB) allowed markets to have a positive retracement. Indeed, credit markets were in need of some sort of comfort being from a monetary aspect or from the geopolitical front following a negative 2018. In fact, markets applauded the dovish stance amid concerns of slow global growth and geopolitical uncertainty.

    Latest data from China continued to display signs of softness specifically inflation being less than expected, while manufacturing activity contracted for the second time in January. In this regard, we should continue to see further stimulus from the fiscal and monetary front. Other regions have also showed weakness with Germany facing the consequences of the Trade War. This was witnessed in the latest industrial figures that registered its worst performance in more than 5 years.

    Moreover, Brexit and Italy are other uncertainties for 2019. The latter was dragged into a recession with uncertainty increasing due to the very unpopular economic measures being implemented by the populist government, which are however seen to be very welcomed by southern Italy citizens.

    A positive for credit markets in January was the Fed’s dovish tone with the market now pricing no interest rate hikes for 2019.This led to a tighter U.S. Treasury Curve and a weaker dollar. Furthermore, the ECB also softened its tone on the back of geopolitical issues.

    For 2019, we are more constructive given the recent supporting monetary stance, which should be a positive trigger for HY debt. In the month of January, the fund outperformed the market as the Managers opted in dipping into credit that was harshly impacted in 2018. The Managers will continue to seek value in credit stories with attractive valuations and adjust the cash levels accordingly.

  • Key facts & performance

    Fund Manager

    Mark Vella

    Mark Vella is an Investment Manager at Calamatta Cuschieri with over 10 years' experience. He specialises in Fixed Income where his main responsibilities include co-managing the fixed income segment of discretionary portfolios. He is a member on a number of Investment Committees. He is a regular contributor to the Times of Malta Online. He graduated with honours in Banking & Finance from the University of Malta.

    PRICE (USD)

    $

    ASSET CLASS

    Bonds

    MIN. INITIAL INVESTMENT

    $3000

    FUND TYPE

    UCITS

    BASE CURRENCY

    USD

    RETURN (SINCE INCEPTION)*

    14.07%

    *View Performance History below
    Inception Date: 30 May 2013
    ISIN: MT7000007753
    Bloomberg Ticker: CALCHIA MV
    Entry Charge: Up to 2.5%
    Total Expense Ratio: 1.47%
    Exit Charge: None
    Distribution Yield (%): N/A
    Underlying Yield (%): 5.22
    Distribution: N/A
    Total Net Assets: $17.8 m
    Month and NAV in USD: 119.52
    Number of Holdings: 51
    Auditors: Deloitte Malta
    Legal Advisor: Ganado & Associates
    Custodian: Sparkasse Bank Malta p.l.c.
    % of Top 10 Holdings: 26.2

    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

    5.625% Ineos 2024
    3.7%
    7.00% KB Home 2021
    3.5%
    5.375% Petrobras 202
    2.8%
    4.75% Lennar 2022
    2.8%
    6.25% IGT 2022
    2.3%
    7.25% JBS 2024
    2.3%
    6.25% GTH Finance 2020
    2.2%
    6.00% Icahn Ent. 2020
    2.2%
    5.25% Sberbank 2023
    2.2%
    5.299% Petrobras 2025
    2.2%

    Top Holdings by Country*

    USA
    19.1%
    Russia
    15.0%
    Brazil
    13.6%
    UK
    9.2%
    Turkey
    4.1%
    Indonesia
    4.0%
    China
    3.6%
    Switzerland
    2.8%
    France
    2.1%
    Italy
    2.0%
    *including exposures to CIS

    Major Sector Breakdown*

    Financials
    28.2%
    Consumer Discretionary
    14.1%
    Materials
    13.5%
    Asset 7
    Communications
    10.6%
    Energy
    10.1%
    Consumer Staples
    8.7%
    *excluding exposures to CIS

    Asset Allocation

    Cash 8.1%
    Bonds 90.2%
    CIS/ETFs 1.7%

    Maturity Buckets*

    70.0%
    0-5 Years
    16.4%
    5-10 Years
    2.5%
    10 Years+
    *based on the Next Call Date

    Performance History (EUR)*

    YTD

    2.44%

    2018

    -3.22%

    2017

    -2.59%

    2016

    1.00%

    2015

    -2.59%

    Inception*

    14.07%

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

    Credit Ratings*

    Average Credit Rating: BB-
    *excluding exposures to CIS

    Currency Allocation

    USD 100.0%
    Other 0.0%

    Risk Statistics

    Sharpe Ratio
    0.90 (3Y)
    0.00 (5Y)
    Std. Deviation
    3.21 (3Y)
    3.56 (5Y)
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