Investment Objectives

The CC Global 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 Global 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 Global 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

August 2021

Since first detected in January 2020, the coronavirus pandemic and ensuing global response have dictated economic activity and markets way forward. Markets initially headed significantly lower as the economic landscape, following the imposition of movement restrictions, deteriorated. However, a concerted effort by both Central banks and governments led to what we are witnessing today – a robust economic recovery and upward trajectory in financial markets. 

From an economic viewpoint, the path towards a full recovery, proved bumpier than previously anticipated. A vaccination drive taking long to pick-up speed along with a more severe wave of infections, lessened the pace of the recovery. The outlook, albeit currently faced with a slowdown in growth and a rapid increase in infections, seems benevolent.

The Delta variant, first originated in India and considered to be significantly more transmissible than previous strains, is said to be behind the recent rapid rise in infections. Countries witnessing a rise in infection rate, led their authorities to re-think their way forward, with some resorting to a re-introduction of restrictive measures. Some, also announced booster programmes to deliver third doses to their population.

The Federal Reserve’s (Fed) annual Jackson Hole symposium was highly anticipated. Jerome Powell struck a cautious note in his statement, stating that while the US economy had made progress on some important targets, particularly on inflation, tapering too aggressively may derail progress at a sensitive time, reiterating a desire to see further progress in the labour market. Although broadly perceived as dovish (supporting low-interest rates and an expansionary monetary policy), Powell’s comments were in-line with expectations that tapering could begin this year. The boost to sentiment overshadowed worries over Hurricane Ida and the Delta variant.

Although the developed market world appears to be at or just past the peak rate of growth, economic data has largely remained positive.

In August, the U.S. manufacturing PMI stood at 61.1, little-changed from a preliminary estimate of 61.2, but down from a record of 63.4 in July. The reading pointed to the slowest growth in factory activity in 4 months as output growth was reportedly hampered by capacity constraints and material shortages. Lead times for inputs extended further as cost burdens soared, with the pace of inflation reaching a fresh series high. The expansion was supported by steep upturns in production and new orders. Albeit portraying robust growth, a pullback in the rate of expansion was also observed in the contact-intensive services segment. In the month, services PMI was revised slightly higher to 61.7, upwardly revised from 61.5, yet significantly lower from July’s 65.9 as business activity, new orders, and employment dropped.

Annual inflation rate in the U.S. remained steady at 5.4 per cent. In 2021, inflation has largely been on the rise amid low base effects from an unprecedented 2020 and as the economic recovery picks up, restrictions ease, and demand surges amid widespread vaccination programmes and fiscal support. Month-on-month, the Consumer Price Index (CPI) increased by 0.5 per cent on a seasonally adjusted basis after rising 0.9 per cent in June. 

In regard to the labour market, the US economy added 235,000 jobs in August of 2021, the lowest in 7 months and significantly below forecasts of 750,000. A surge in Coronavirus infections is said to may have discouraged companies from hiring and workers from actively seeking employment. August’s jobs report saw wages rise by 0.6% month over month.

Albeit concerns over the Delta variant and signs of global growth momentum possibly easing in developed world, corporate credit largely performed well in August. High yield credit outperformed its higher-rated counterparts, generating total positive returns as sovereign yields reversed some of the recent downward moves. Indeed, the benchmark U.S. 10-year Treasury yield, closed the month 9bps higher at 1.31 per cent – a figure which remains significantly below high’s witnessed earlier this year, revolving above the 1.70 per cent levels.

Throughout the month of August, the CC Global High Income Bond Fund rose by 0.53 per cent, with a year to date outperformance over the internal comparable benchmark. Throughout the month the Manager continued to seek pockets of value by looking into attractive credit stories, primarily within the basic materials and communications segment.  Among other names, the Manager increased its exposure in American chemical company, Chemours and opened a position in Chartered Communications given its resilient model aided by a relatively stable sector.

Albeit downside risks, specifically related to the health crisis remain, the manager remains constructive within the high yield space. Going forward, the manager believes that credit markets will continue to be supported by the actions taken by the Federal Reserve as well as the uplift from the sequential easing of coronavirus-induced restrictions and vaccination developments.

A quick introduction to our Global 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 (USD)

$

ASSET CLASS

Bonds

MIN. INITIAL INVESTMENT

$3000

FUND TYPE

UCITS

BASE CURRENCY

USD

RETURN (SINCE INCEPTION)*

30.66%

*View Performance History below
Inception Date: 29 May 2013
ISIN: MT7000007753
Bloomberg Ticker: CALCHIA MV
Entry Charge: Up to 2.5%
Total Expense Ratio: 1.63%
Exit Charge: None
Distribution Yield (%): N/A
Underlying Yield (%): 4.87
Distribution: N/A
Total Net Assets: $19.16 mn
Month end NAV in USD: 136.91
Number of Holdings: 50
Auditors: Deloitte Malta
Legal Advisor: Ganado & Associates
Custodian: Sparkasse Bank Malta p.l.c.
% of Top 10 Holdings: 33.9

Performance To Date (USD)

Top 10 Holdings

iShares USD HY Corp Dist
72%
6.75% Societe Generale perp
3.6%
8% Unicredit Spa perp
3.5%
6.25% HSBC Holdings plc perp
3.3%
4% JP Morgan Chase & Co perp
3.2%
7% KB Home 2021
3.2%
4.75% Lennar Corp 2022
2.7%
5.625% Ineos Group 2024
2.6%
5.299% Petrobras Global Finance 2025
2.3%
5.375% Chemours Co 2027
2.3%

Major Sector Breakdown*

Financials
20.3%
Asset 7
Communications
8.4%
Funds
8.4%
Materials
7.6%
Materials
7.1%
Industrials
6.3%
*excluding exposures to CIS

Maturity Buckets*

59.7%
0-5 Years
21.6%
5-10 Years
5.3%
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*

Brazil
11.0%
France
4.7%
Turkey
4.5%
Germany
3.8%
Italy
3.5%
Switzerland
2.9%
India
2.7%
Netherlands
2.2%
China
1.7%
Mexico
1.3%
*including exposures to CIS

Asset Allocation

Cash 5.1%
Bonds 86.5%
CIS/ETFs 8.4%

Performance History (EUR)*

YTD

3.29%

2020

3.07%

2019

10.23%

2018

-3.22%

2017

5.71%

Annualised Since Inception*

3.29%

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

Currency Allocation

USD 100.0%
Other 0.0%

Risk Statistics

Sharpe Ratio
0.64 (3Y)
0.62 (5Y)
Std. Deviation
8.07% (3Y)
6.43% (5Y)

Interested in this product?

  • Investment Objectives

    The CC Global 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 Global 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

    August 2021

    Since first detected in January 2020, the coronavirus pandemic and ensuing global response have dictated economic activity and markets way forward. Markets initially headed significantly lower as the economic landscape, following the imposition of movement restrictions, deteriorated. However, a concerted effort by both Central banks and governments led to what we are witnessing today – a robust economic recovery and upward trajectory in financial markets. 

    From an economic viewpoint, the path towards a full recovery, proved bumpier than previously anticipated. A vaccination drive taking long to pick-up speed along with a more severe wave of infections, lessened the pace of the recovery. The outlook, albeit currently faced with a slowdown in growth and a rapid increase in infections, seems benevolent.

    The Delta variant, first originated in India and considered to be significantly more transmissible than previous strains, is said to be behind the recent rapid rise in infections. Countries witnessing a rise in infection rate, led their authorities to re-think their way forward, with some resorting to a re-introduction of restrictive measures. Some, also announced booster programmes to deliver third doses to their population.

    The Federal Reserve’s (Fed) annual Jackson Hole symposium was highly anticipated. Jerome Powell struck a cautious note in his statement, stating that while the US economy had made progress on some important targets, particularly on inflation, tapering too aggressively may derail progress at a sensitive time, reiterating a desire to see further progress in the labour market. Although broadly perceived as dovish (supporting low-interest rates and an expansionary monetary policy), Powell’s comments were in-line with expectations that tapering could begin this year. The boost to sentiment overshadowed worries over Hurricane Ida and the Delta variant.

    Although the developed market world appears to be at or just past the peak rate of growth, economic data has largely remained positive.

    In August, the U.S. manufacturing PMI stood at 61.1, little-changed from a preliminary estimate of 61.2, but down from a record of 63.4 in July. The reading pointed to the slowest growth in factory activity in 4 months as output growth was reportedly hampered by capacity constraints and material shortages. Lead times for inputs extended further as cost burdens soared, with the pace of inflation reaching a fresh series high. The expansion was supported by steep upturns in production and new orders. Albeit portraying robust growth, a pullback in the rate of expansion was also observed in the contact-intensive services segment. In the month, services PMI was revised slightly higher to 61.7, upwardly revised from 61.5, yet significantly lower from July’s 65.9 as business activity, new orders, and employment dropped.

    Annual inflation rate in the U.S. remained steady at 5.4 per cent. In 2021, inflation has largely been on the rise amid low base effects from an unprecedented 2020 and as the economic recovery picks up, restrictions ease, and demand surges amid widespread vaccination programmes and fiscal support. Month-on-month, the Consumer Price Index (CPI) increased by 0.5 per cent on a seasonally adjusted basis after rising 0.9 per cent in June. 

    In regard to the labour market, the US economy added 235,000 jobs in August of 2021, the lowest in 7 months and significantly below forecasts of 750,000. A surge in Coronavirus infections is said to may have discouraged companies from hiring and workers from actively seeking employment. August’s jobs report saw wages rise by 0.6% month over month.

    Albeit concerns over the Delta variant and signs of global growth momentum possibly easing in developed world, corporate credit largely performed well in August. High yield credit outperformed its higher-rated counterparts, generating total positive returns as sovereign yields reversed some of the recent downward moves. Indeed, the benchmark U.S. 10-year Treasury yield, closed the month 9bps higher at 1.31 per cent – a figure which remains significantly below high’s witnessed earlier this year, revolving above the 1.70 per cent levels.

    Throughout the month of August, the CC Global High Income Bond Fund rose by 0.53 per cent, with a year to date outperformance over the internal comparable benchmark. Throughout the month the Manager continued to seek pockets of value by looking into attractive credit stories, primarily within the basic materials and communications segment.  Among other names, the Manager increased its exposure in American chemical company, Chemours and opened a position in Chartered Communications given its resilient model aided by a relatively stable sector.

    Albeit downside risks, specifically related to the health crisis remain, the manager remains constructive within the high yield space. Going forward, the manager believes that credit markets will continue to be supported by the actions taken by the Federal Reserve as well as the uplift from the sequential easing of coronavirus-induced restrictions and vaccination developments.

  • 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)*

    30.66%

    *View Performance History below
    Inception Date: 29 May 2013
    ISIN: MT7000007753
    Bloomberg Ticker: CALCHIA MV
    Entry Charge: Up to 2.5%
    Total Expense Ratio: 1.63%
    Exit Charge: None
    Distribution Yield (%): N/A
    Underlying Yield (%): 4.87
    Distribution: N/A
    Total Net Assets: $19.16 mn
    Month end NAV in USD: 136.91
    Number of Holdings: 50
    Auditors: Deloitte Malta
    Legal Advisor: Ganado & Associates
    Custodian: Sparkasse Bank Malta p.l.c.
    % of Top 10 Holdings: 33.9

    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

    iShares USD HY Corp Dist
    72%
    6.75% Societe Generale perp
    3.6%
    8% Unicredit Spa perp
    3.5%
    6.25% HSBC Holdings plc perp
    3.3%
    4% JP Morgan Chase & Co perp
    3.2%
    7% KB Home 2021
    3.2%
    4.75% Lennar Corp 2022
    2.7%
    5.625% Ineos Group 2024
    2.6%
    5.299% Petrobras Global Finance 2025
    2.3%
    5.375% Chemours Co 2027
    2.3%

    Top Holdings by Country*

    Brazil
    11.0%
    France
    4.7%
    Turkey
    4.5%
    Germany
    3.8%
    Italy
    3.5%
    Switzerland
    2.9%
    India
    2.7%
    Netherlands
    2.2%
    China
    1.7%
    Mexico
    1.3%
    *including exposures to CIS

    Major Sector Breakdown*

    Financials
    20.3%
    Asset 7
    Communications
    8.4%
    Funds
    8.4%
    Materials
    7.6%
    Materials
    7.1%
    Industrials
    6.3%
    *excluding exposures to CIS

    Asset Allocation

    Cash 5.1%
    Bonds 86.5%
    CIS/ETFs 8.4%

    Maturity Buckets*

    59.7%
    0-5 Years
    21.6%
    5-10 Years
    5.3%
    10 Years+
    *based on the Next Call Date

    Performance History (EUR)*

    YTD

    3.29%

    2020

    3.07%

    2019

    10.23%

    2018

    -3.22%

    2017

    5.71%

    Annualised Since Inception*

    3.29%

    *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
    0.64 (3Y)
    0.62 (5Y)
    Std. Deviation
    8.07% (3Y)
    6.43% (5Y)
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