Investment Objectives

The CC Global High Income Bond Fund Distributor 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 Distributor is:

  • Seeking to earn a high level of regular Income
  • Seeking an actively managed & diversified investment in high-yield bonds

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

December 2019

With the December 15th deadline looming large and UK elections on the brink of taking place, December, as expected, proved to be an eventful month on the political front.

As anticipated, tensions between the U.S. and China significantly eased towards the end of the year, when the two nations agreed a phase-one deal to ratchet down the trade war, this boosting confidence and lessening uncertainty across markets. The news came after 20 months of on-and-off negotiations and tariff escalations that unsettled markets and damped global economic growth.

The agreement between the world’s two largest economies, amongst other, commits China to; buy at least $40bn worth of U.S. agricultural goods annually, tighten protection for U.S. intellectual property, and prohibits the forced transfer of technology from U.S. corporations. In exchange, Washington agreed to cut back on tariffs previously introduced, whilst agreeing not to proceed with a new escalation in levies on Chinese consumer goods.

Although a phase-one deal proved important to avoid a direct impact on the consumer at large, some of the biggest sources of strain in the bilateral relationship, such as China’s use of industrial subsidies and state-owned enterprises were left at bay, leaving these thorny issues to a later stage.

From the macroeconomic front, the U.S. reported a slightly lower Manufacturing PMI to 52.4 from 52.5 in December. Meanwhile, U.S. services PMI was revised higher to a five-month high of 52.8 from a preliminary estimate of 52.2, and higher than November’s final reading of 51.6. In addition, from the employment front, the number of Americans filing for unemployment benefits edged down by 2,000 people, to 224,000, beating market expectations.

Meanwhile, the U.S. Treasury Yields continued to trade within a range, with the 10-year reaching a high of 1.954 percent for the month, following the risk-on mode on a U.S.-China phase one agreement. Albeit hovering at higher levels when compared to recent months, the U.S. Treasury yields are relatively still depressed, when compared to the levels at the beginning of the year, mainly following the announcement by the Fed that rate hikes will be paused, thus maintaining a more accommodative stance. Global HY bonds closed-off the year on a strong note, as investors re-shifted their assets to the more risky segments.

The CC Global High Income fund closed the month up 0.93 percent, while on a year-to-date basis it posted a 10.3 percent gain with strong risk adjusted metrics when compared to its peers. In the month, the Manager opened an exposure in Extended Stay Hospitality, a classified REIT, which operates within the budget hotel industry. A BB- rated credit story with cash flow visibility, which translates in benign credit metrics. Furthermore, additional weightings to the meat industry were added through Marfrig, as the credit story continues to improve on the basis of a turnaround in the Brazilian economy, in addition to the boost in sales triggered through the Asian swine flu, which impacted positively the sector.

Moving in 2020, the Manager believes that the EM space might offer more pockets of value. Given a maintained accommodative monetary stance, a stance which EM Central Banks are also following suite, EM HY bonds should continue to offer value. Furthermore, selective U.S. HY will continue to offer value and thus the Manager believes that through a diligent bond picking process, the fund should continue to perform well in 2020.

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)*

39.65%

*View Performance History below
Inception Date: 01 Sep 2011
ISIN: MT7000003067
Bloomberg Ticker: CALCHIU MV
Entry Charge: None
Total Expense Ratio: 1.51%
Exit Charge: None
Distribution Yield (%): 4.500
Underlying Yield (%): 4.84
Distribution: 31/03 and 30/09
Total Net Assets: $17.7 m
Month end NAV in USD: 92.03
Number of Holdings: 48
Auditors: Deloitte Malta
Legal Advisor: Ganado & Associates
Custodian: Sparkasse Bank Malta p.l.c.
% of Top 10 Holdings: 30.2

Performance To Date (USD)

Top 10 Holdings

iShared USD HY Corp
6.1%
7.00% KB Home 2021
3.6%
4.75% Lennar 2022
3.0%
5.625% Ineos 2024
2.9%
6.75% Societe Generale Perp
2.5%
8.00% Unicredit Perp
2.5%
5.299% Petrobras 2025
2.5%
5.25% Sberbank 2023
2.4%
6.25% IGT 2022
2.4%
6.35% Republic of Turkey
2.4%

Major Sector Breakdown*

Financials
23.2%
Materials
15.6%
Consumer Discretionary
13.3%
Asset 7
Communications
8.9%
Energy
8.3%
Consumer Staples
7.6%
*excluding exposures to CIS

Maturity Buckets*

64.0%
0-5 Years
15.8%
5-10 Years
3.0%
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
27.6%
Russia
20.2%
Brazil
11.5%
UK
5.1%
Turkey
4.7%
Indonesia
4.0%
France
3.7%
Switzerland
3.1%
China
3.0%
Italy
2.5%
*including exposures to CIS

Asset Allocation

Cash 6.8%
Bonds 85.2%
CIS/ETFs 8.0%

Performance History (EUR)*

YTD

10.22%

2018

-3.22%

2017

5.70%

2016

10.02%

2015

-2.59%

Inception***

39.65%

*Data in the chart does not include any dividends distributed since the Fund was launched on 1st September 2011.
**Performance figures are calculated using the Value Added Monthly Index "VAMI" principle. The VAMI calculates the total return gained by an investor from reinvestment of any dividends and additional interest gained through compounding
***The Distributor Share Class (Class D) was launched on 01 September 2011.

Currency Allocation

USD 100.0%
Other 0.0%

Risk Statistics

Sharpe Ratio
1.17 (3Y)
0.71 (5Y)
Std. Deviation
2.27 (3Y)
3.32 (5Y)

Interested in this product?

  • Investment Objectives

    The CC Global High Income Bond Fund Distributor 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 Distributor is:

    • Seeking to earn a high level of regular Income
    • Seeking an actively managed & diversified investment in high-yield bonds
    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

    December 2019

    With the December 15th deadline looming large and UK elections on the brink of taking place, December, as expected, proved to be an eventful month on the political front.

    As anticipated, tensions between the U.S. and China significantly eased towards the end of the year, when the two nations agreed a phase-one deal to ratchet down the trade war, this boosting confidence and lessening uncertainty across markets. The news came after 20 months of on-and-off negotiations and tariff escalations that unsettled markets and damped global economic growth.

    The agreement between the world’s two largest economies, amongst other, commits China to; buy at least $40bn worth of U.S. agricultural goods annually, tighten protection for U.S. intellectual property, and prohibits the forced transfer of technology from U.S. corporations. In exchange, Washington agreed to cut back on tariffs previously introduced, whilst agreeing not to proceed with a new escalation in levies on Chinese consumer goods.

    Although a phase-one deal proved important to avoid a direct impact on the consumer at large, some of the biggest sources of strain in the bilateral relationship, such as China’s use of industrial subsidies and state-owned enterprises were left at bay, leaving these thorny issues to a later stage.

    From the macroeconomic front, the U.S. reported a slightly lower Manufacturing PMI to 52.4 from 52.5 in December. Meanwhile, U.S. services PMI was revised higher to a five-month high of 52.8 from a preliminary estimate of 52.2, and higher than November’s final reading of 51.6. In addition, from the employment front, the number of Americans filing for unemployment benefits edged down by 2,000 people, to 224,000, beating market expectations.

    Meanwhile, the U.S. Treasury Yields continued to trade within a range, with the 10-year reaching a high of 1.954 percent for the month, following the risk-on mode on a U.S.-China phase one agreement. Albeit hovering at higher levels when compared to recent months, the U.S. Treasury yields are relatively still depressed, when compared to the levels at the beginning of the year, mainly following the announcement by the Fed that rate hikes will be paused, thus maintaining a more accommodative stance. Global HY bonds closed-off the year on a strong note, as investors re-shifted their assets to the more risky segments.

    The CC Global High Income fund closed the month up 0.93 percent, while on a year-to-date basis it posted a 10.3 percent gain with strong risk adjusted metrics when compared to its peers. In the month, the Manager opened an exposure in Extended Stay Hospitality, a classified REIT, which operates within the budget hotel industry. A BB- rated credit story with cash flow visibility, which translates in benign credit metrics. Furthermore, additional weightings to the meat industry were added through Marfrig, as the credit story continues to improve on the basis of a turnaround in the Brazilian economy, in addition to the boost in sales triggered through the Asian swine flu, which impacted positively the sector.

    Moving in 2020, the Manager believes that the EM space might offer more pockets of value. Given a maintained accommodative monetary stance, a stance which EM Central Banks are also following suite, EM HY bonds should continue to offer value. Furthermore, selective U.S. HY will continue to offer value and thus the Manager believes that through a diligent bond picking process, the fund should continue to perform well in 2020.

  • 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)*

    39.65%

    *View Performance History below
    Inception Date: 01 Sep 2011
    ISIN: MT7000003067
    Bloomberg Ticker: CALCHIU MV
    Entry Charge: None
    Total Expense Ratio: 1.51%
    Exit Charge: None
    Distribution Yield (%): 4.500
    Underlying Yield (%): 4.84
    Distribution: 31/03 and 30/09
    Total Net Assets: $17.7 m
    Month end NAV in USD: 92.03
    Number of Holdings: 48
    Auditors: Deloitte Malta
    Legal Advisor: Ganado & Associates
    Custodian: Sparkasse Bank Malta p.l.c.
    % of Top 10 Holdings: 30.2

    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

    iShared USD HY Corp
    6.1%
    7.00% KB Home 2021
    3.6%
    4.75% Lennar 2022
    3.0%
    5.625% Ineos 2024
    2.9%
    6.75% Societe Generale Perp
    2.5%
    8.00% Unicredit Perp
    2.5%
    5.299% Petrobras 2025
    2.5%
    5.25% Sberbank 2023
    2.4%
    6.25% IGT 2022
    2.4%
    6.35% Republic of Turkey
    2.4%

    Top Holdings by Country*

    USA
    27.6%
    Russia
    20.2%
    Brazil
    11.5%
    UK
    5.1%
    Turkey
    4.7%
    Indonesia
    4.0%
    France
    3.7%
    Switzerland
    3.1%
    China
    3.0%
    Italy
    2.5%
    *including exposures to CIS

    Major Sector Breakdown*

    Financials
    23.2%
    Materials
    15.6%
    Consumer Discretionary
    13.3%
    Asset 7
    Communications
    8.9%
    Energy
    8.3%
    Consumer Staples
    7.6%
    *excluding exposures to CIS

    Asset Allocation

    Cash 6.8%
    Bonds 85.2%
    CIS/ETFs 8.0%

    Maturity Buckets*

    64.0%
    0-5 Years
    15.8%
    5-10 Years
    3.0%
    10 Years+
    *based on the Next Call Date

    Performance History (EUR)*

    YTD

    10.22%

    2018

    -3.22%

    2017

    5.70%

    2016

    10.02%

    2015

    -2.59%

    Inception***

    39.65%

    *Data in the chart does not include any dividends distributed since the Fund was launched on 1st September 2011.
    **Performance figures are calculated using the Value Added Monthly Index "VAMI" principle. The VAMI calculates the total return gained by an investor from reinvestment of any dividends and additional interest gained through compounding
    ***The Distributor Share Class (Class D) was launched on 01 September 2011.

    Credit Ratings*

    Average Credit Rating: BB-
    *excluding exposures to CIS

    Currency Allocation

    USD 100.0%
    Other 0.0%

    Risk Statistics

    Sharpe Ratio
    1.17 (3Y)
    0.71 (5Y)
    Std. Deviation
    2.27 (3Y)
    3.32 (5Y)
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