Investment Objectives

The Fund aims to achieve a combination of income, with the possibility of capital growth by investing in a diversified portfolio of collective investment schemes.

The Investment Manager will invest in collective investment schemes including UCITS, ETFs that invest in a broad range of assets, including debt and equity securities.

We aim to build a diversified portfolio spread across several industries and sectors. The Fund is actively managed, not managed by reference to any index.

Investor Profile

A typical investor in the Income Strategy Fund is:

  • Seeking to earn a high level of regular Income
  • Seeking an actively managed & diversified investment primarily in income-yielding funds 

Fund Rules

  1. The fund may invest up to 40% of its assets in CISs that are permitted to invest 65% or more of their assets in money market instruments.
  2. The fund may invest up to 30% of its assets in CISs that are permitted to invest 65% or more of their assets in investment-grade bonds.
  3. The fund may invest up to 100% of its assets in CISs that are permitted to invest 65% or more of their assets in high yield bonds.
  4. The fund may invest up to 20% of its assets in CISs that are permitted to invest 65% or more of their assets in equity securities.

Commentary

May 2025

Introduction

Volatility persisted across global bond markets in May 2025. Initial relief from easing China-US trade tensions helped allay fears of a US recession. However, market attention quickly pivoted to concerns about the sustainability of US fiscal policy, further underscored by the downgrade of the US sovereign credit rating. The ‘Reconciliation Bill’, approved by the House of Representatives and pending Senate approval, was perceived as worsening the country’s debt trajectory, pushing yields on longer-dated US Treasuries higher.

Adding to market unease, the US Supreme Court ruled (near month-end) that the Trump administration had overstepped its authority by invoking emergency economic powers to impose baseline 10% and reciprocal tariffs. This decision complicates ongoing trade negotiations with trade partners during the 90-day extension period, which ends on July 9. While the ruling may help ease some pressure on economic growth, it poses fiscal challenges for the administration’s budget plan, which had relied on tariff revenues to fund proposed tax cuts.

The 10-year US Treasury yield experienced notable intra-month fluctuations: starting around 4.16%, peaking at 4.60% on May 21, and ending near 4.4%. European government bond markets, in comparison, fared better, with only modest yield rises in Germany. Peripheral markets outperformed, with 10-year yields in Italy and Spain tightening by 8 and 2bps, respectively.

Despite lingering uncertainties, corporate credit continued to recover from the early April sell-off. Within investment-grade credit, US performance was largely flat as prices remained largely conditioned by the movements observed across sovereign bonds. European investment-grade credit outperformed, returning 0.52% for the month. In high yield, US markets saw the strongest gains, rising 1.68% in May as investor sentiment improved amid reduced recession risks and a more conciliatory tone on trade. European high yield also performed well, posting a solid 1.33% return, albeit trailing US gains.

Market environment and performance

Earlier concerns about potential headwinds facing the U.S. economy in early 2025, driven by newly implemented tariffs and threats of persistent inflation, were validated by the second estimate of Q1 GDP growth. Although the figure was revised slightly upward to -0.2% from an initial reading of -0.3%, it still confirmed economic contraction. The upward revision was primarily due to stronger-than-expected fixed investment, which helped offset weaker consumer spending and a larger-than-anticipated drag from net trade. Imports of goods and services surged by 42.6% as businesses and consumers rushed to front-load purchases ahead of expected price increases following tariff announcements by the Trump administration. Meanwhile, consumer spending growth slowed to 1.2%.

While earlier leading indicators had pointed to a slowdown, more recent data showed signs of improvement, suggesting a rebound in activity. Notably, the S&P Global U.S. Composite PMI for May 2025 was revised up to 53.0 from a preliminary estimate of 52.1, and well above April’s 19-month low of 50.6. The reading signals solid expansion across both services and manufacturing sectors, underpinned by increased client spending, particularly from domestic customers.

Despite some signs of softening, the U.S. labour market continues to demonstrate resilience. Employment growth, though moderating, added 139k jobs in May, slightly above expectations, even as federal government employment declined by 22k. The unemployment rate remained steady at 4.2%, in line with market forecasts. On the inflation front, pressures continued to ease. Headline inflation declined to 2.3% in April from 2.4% the previous month, while core inflation – which excludes volatile components such as energy and food – remained unchanged at 2.8%.

In the euro area, business activity continued to expand for a fifth consecutive month, though the pace of growth was only marginal, the weakest since February. A decline in new business, particularly within the services sector, marked the most pronounced deterioration in demand in six months.

Inflation across the bloc also moderated, easing to 1.9% year-on-year in May 2025 from 2.2% in April and falling below market expectations of 2.0%, according to a preliminary estimate. This marks the first time inflation has dipped below the European Central Bank’s 2.0% target since September 2024, reinforcing expectations of a 25bps rate cut at the ECB’s upcoming June meeting.

Fund performance

Performance for the month of May proved positive, noting a 0.98% gain for the CC Income Strategy Fund.

Market and investment outlook

In May, volatility in the US Treasury market persisted, highlighting the market’s heightened sensitivity to evolving economic and policy signals. Initial calm, spurred by encouraging developments around trade tariffs, gave way to renewed concerns over fiscal sustainability. These were triggered in part by the approval of the Reconciliation Bill in the House of Representatives, which, pending Senate approval, was seen as exacerbating the country’s debt outlook. Despite lingering uncertainties, corporate credit – particularly the lower rated segment – continued to recover from the early April sell-off. US high yield corporates saw the strongest gains.

Looking ahead, fixed income markets are likely to remain reactive to the evolving effects of tariffs. The US Q1 GDP contraction, largely driven by a surge in imports ahead of expected price increases, appears more reflective of temporary distortions than a sustained downturn. However, the longer-term inflationary consequences, stemming from higher input costs and potential supply chain disruptions, could complicate the Federal Reserve’s policy trajectory. Should inflation remain elevated, the Fed may be forced to delay or moderate the pace of rate cuts currently anticipated by markets. At the same time, signs of moderating demand and slowing growth could support the case for eventual policy easing. The current shape of the yield curve – characterized by short-term yields below the Fed’s effective rate and a modest steepening at the long end – highlights market uncertainty, balancing short-term disinflation against longer-term fiscal risks.

On an economic front, the imposition of trade tariffs – exacerbated by the US’s Liberation Day measures – further clouds the macro outlook and adds complexity to the yield curve’s path, as consumers grapple with rising prices and a resurgence in inflationary pressures. In this context, duration positioning and selective credit exposure remain key. While volatility in core rates is likely to persist, credit markets are being supported by stable corporate fundamentals and resilient balance sheets. The interplay between a strong labour market and persistent inflation suggests a cautious, neutral stance on duration, particularly as yield curve dynamics remain uncertain.

We maintain our current preference, which leans towards European credit, underpinned by the prospects of continued monetary easing by the ECB. Nevertheless, the dynamic nature of the current environment, particularly the constantly evolving geopolitical tensions, require a highly proactive and adaptive management style to navigate potential risks and capitalize on emerging opportunities.

A quick introduction to our Global High Income Bond Fund

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Key Facts & Performance

Fund Manager

Jordan Portelli

Jordan is CIO at CC Finance Group. He has extensive experience in research and portfolio management with various institutions. Today he is responsible of the group’s investment strategy and manages credit and multi-asset strategies.

PRICE (EUR)

ASSET CLASS

Mixed

MIN. INITIAL INVESTMENT

€5000

FUND TYPE

UCITS

BASE CURRENCY

EUR

5 year performance*

0%

*View Performance History below
Inception Date: 15 Sep 2021
ISIN: MT7000030680
Bloomberg Ticker: CCPISAE MV
Distribution Yield (%): 3.39
Underlying Yield (%): -
Distribution: 31/05 and 30/11
Total Net Assets: 5.91 mn
Month end NAV in EUR: 92.71
Number of Holdings: 13
Auditors: Grant Thornton
Legal Advisor: GANADO Advocates
Custodian: Sparkasse Bank Malta p.l.c.

Performance To Date (EUR)

Top 10 Holdings

UBS (Lux) Bond Fund - Euro High Yield
18.7%
CC Funds SICAV plc - High Income Bond Fund
9.8%
Nordea 1 - European High Yield Bond Fund
9.6%
Robeco Capital Growth Funds - High Yield Bonds
9.3%
BlackRock Global High Yield Bond Fund
8.1%
DWS Invest Euro High Yield Corp
7.9%
Fidelity Funds - European High Yield Bond Fund
7.8%
AXA World Funds - Global High Yield Bonds
7.8%
Janus Henderson Horizon Global High Yield Bond Fund
7.7%
Schroder International Selection Fund Global High Yield
7.7%
Data for major sector breakdown is not available for this fund.
Data for maturity buckets is not available for this fund.
Data for credit ratings is not available for this fund.

Risk & Reward Profile

1
2
3
4
5
6
7
Lower Risk

Potentialy Lower Reward

Higher Risk

Potentialy Higher Reward

Top Holdings by Country

Europe
36.6%
Global
35.9%
International
24.8%

Asset Allocation

Fund 95.9%
Cash 2.7%
ETF 1.4%

Performance History (EUR)*

1 year

5.36%

3 year

13.19%

* The Distributor Share Class (Class A) was launched on 15 September 2021.
** Performance figures are calculated using the Value Added Monthly Index "VAMI" principle. The VAMI calculates the total return gained by aninvestor from reinvestment of any dividends and additional interest gained through compounding.
*** The Distributor Share Class (Class A) was launched on 15 September 2021.
**** Returns quoted net of TER. Entry and exit charges may reduce returns for investors.

Currency Allocation

Euro 100.0%
USD 0.0%
GBP 0.0%
Data for risk statistics is not available for this fund.

Interested in this product?

  • Investment Objectives

    The Fund aims to achieve a combination of income, with the possibility of capital growth by investing in a diversified portfolio of collective investment schemes.

    The Investment Manager will invest in collective investment schemes including UCITS, ETFs that invest in a broad range of assets, including debt and equity securities.

    We aim to build a diversified portfolio spread across several industries and sectors. The Fund is actively managed, not managed by reference to any index.

  • Investor profile

    A typical investor in the Income Strategy Fund is:

    • Seeking to earn a high level of regular Income
    • Seeking an actively managed & diversified investment primarily in income-yielding funds 
    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

  • Commentary

    May 2025

    Introduction

    Volatility persisted across global bond markets in May 2025. Initial relief from easing China-US trade tensions helped allay fears of a US recession. However, market attention quickly pivoted to concerns about the sustainability of US fiscal policy, further underscored by the downgrade of the US sovereign credit rating. The ‘Reconciliation Bill’, approved by the House of Representatives and pending Senate approval, was perceived as worsening the country’s debt trajectory, pushing yields on longer-dated US Treasuries higher.

    Adding to market unease, the US Supreme Court ruled (near month-end) that the Trump administration had overstepped its authority by invoking emergency economic powers to impose baseline 10% and reciprocal tariffs. This decision complicates ongoing trade negotiations with trade partners during the 90-day extension period, which ends on July 9. While the ruling may help ease some pressure on economic growth, it poses fiscal challenges for the administration’s budget plan, which had relied on tariff revenues to fund proposed tax cuts.

    The 10-year US Treasury yield experienced notable intra-month fluctuations: starting around 4.16%, peaking at 4.60% on May 21, and ending near 4.4%. European government bond markets, in comparison, fared better, with only modest yield rises in Germany. Peripheral markets outperformed, with 10-year yields in Italy and Spain tightening by 8 and 2bps, respectively.

    Despite lingering uncertainties, corporate credit continued to recover from the early April sell-off. Within investment-grade credit, US performance was largely flat as prices remained largely conditioned by the movements observed across sovereign bonds. European investment-grade credit outperformed, returning 0.52% for the month. In high yield, US markets saw the strongest gains, rising 1.68% in May as investor sentiment improved amid reduced recession risks and a more conciliatory tone on trade. European high yield also performed well, posting a solid 1.33% return, albeit trailing US gains.

    Market environment and performance

    Earlier concerns about potential headwinds facing the U.S. economy in early 2025, driven by newly implemented tariffs and threats of persistent inflation, were validated by the second estimate of Q1 GDP growth. Although the figure was revised slightly upward to -0.2% from an initial reading of -0.3%, it still confirmed economic contraction. The upward revision was primarily due to stronger-than-expected fixed investment, which helped offset weaker consumer spending and a larger-than-anticipated drag from net trade. Imports of goods and services surged by 42.6% as businesses and consumers rushed to front-load purchases ahead of expected price increases following tariff announcements by the Trump administration. Meanwhile, consumer spending growth slowed to 1.2%.

    While earlier leading indicators had pointed to a slowdown, more recent data showed signs of improvement, suggesting a rebound in activity. Notably, the S&P Global U.S. Composite PMI for May 2025 was revised up to 53.0 from a preliminary estimate of 52.1, and well above April’s 19-month low of 50.6. The reading signals solid expansion across both services and manufacturing sectors, underpinned by increased client spending, particularly from domestic customers.

    Despite some signs of softening, the U.S. labour market continues to demonstrate resilience. Employment growth, though moderating, added 139k jobs in May, slightly above expectations, even as federal government employment declined by 22k. The unemployment rate remained steady at 4.2%, in line with market forecasts. On the inflation front, pressures continued to ease. Headline inflation declined to 2.3% in April from 2.4% the previous month, while core inflation – which excludes volatile components such as energy and food – remained unchanged at 2.8%.

    In the euro area, business activity continued to expand for a fifth consecutive month, though the pace of growth was only marginal, the weakest since February. A decline in new business, particularly within the services sector, marked the most pronounced deterioration in demand in six months.

    Inflation across the bloc also moderated, easing to 1.9% year-on-year in May 2025 from 2.2% in April and falling below market expectations of 2.0%, according to a preliminary estimate. This marks the first time inflation has dipped below the European Central Bank’s 2.0% target since September 2024, reinforcing expectations of a 25bps rate cut at the ECB’s upcoming June meeting.

    Fund performance

    Performance for the month of May proved positive, noting a 0.98% gain for the CC Income Strategy Fund.

    Market and investment outlook

    In May, volatility in the US Treasury market persisted, highlighting the market’s heightened sensitivity to evolving economic and policy signals. Initial calm, spurred by encouraging developments around trade tariffs, gave way to renewed concerns over fiscal sustainability. These were triggered in part by the approval of the Reconciliation Bill in the House of Representatives, which, pending Senate approval, was seen as exacerbating the country’s debt outlook. Despite lingering uncertainties, corporate credit – particularly the lower rated segment – continued to recover from the early April sell-off. US high yield corporates saw the strongest gains.

    Looking ahead, fixed income markets are likely to remain reactive to the evolving effects of tariffs. The US Q1 GDP contraction, largely driven by a surge in imports ahead of expected price increases, appears more reflective of temporary distortions than a sustained downturn. However, the longer-term inflationary consequences, stemming from higher input costs and potential supply chain disruptions, could complicate the Federal Reserve’s policy trajectory. Should inflation remain elevated, the Fed may be forced to delay or moderate the pace of rate cuts currently anticipated by markets. At the same time, signs of moderating demand and slowing growth could support the case for eventual policy easing. The current shape of the yield curve – characterized by short-term yields below the Fed’s effective rate and a modest steepening at the long end – highlights market uncertainty, balancing short-term disinflation against longer-term fiscal risks.

    On an economic front, the imposition of trade tariffs – exacerbated by the US’s Liberation Day measures – further clouds the macro outlook and adds complexity to the yield curve’s path, as consumers grapple with rising prices and a resurgence in inflationary pressures. In this context, duration positioning and selective credit exposure remain key. While volatility in core rates is likely to persist, credit markets are being supported by stable corporate fundamentals and resilient balance sheets. The interplay between a strong labour market and persistent inflation suggests a cautious, neutral stance on duration, particularly as yield curve dynamics remain uncertain.

    We maintain our current preference, which leans towards European credit, underpinned by the prospects of continued monetary easing by the ECB. Nevertheless, the dynamic nature of the current environment, particularly the constantly evolving geopolitical tensions, require a highly proactive and adaptive management style to navigate potential risks and capitalize on emerging opportunities.

  • Key facts & performance

    Fund Manager

    Jordan Portelli

    Jordan is CIO at CC Finance Group. He has extensive experience in research and portfolio management with various institutions. Today he is responsible of the group’s investment strategy and manages credit and multi-asset strategies.

    PRICE (EUR)

    ASSET CLASS

    Mixed

    MIN. INITIAL INVESTMENT

    €5000

    FUND TYPE

    UCITS

    BASE CURRENCY

    EUR

    5 year performance*

    0%

    *View Performance History below
    Inception Date: 15 Sep 2021
    ISIN: MT7000030680
    Bloomberg Ticker: CCPISAE MV
    Distribution Yield (%): 3.39
    Underlying Yield (%): -
    Distribution: 31/05 and 30/11
    Total Net Assets: 5.91 mn
    Month end NAV in EUR: 92.71
    Number of Holdings: 13
    Auditors: Grant Thornton
    Legal Advisor: GANADO Advocates
    Custodian: Sparkasse Bank Malta p.l.c.

    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

    UBS (Lux) Bond Fund - Euro High Yield
    18.7%
    CC Funds SICAV plc - High Income Bond Fund
    9.8%
    Nordea 1 - European High Yield Bond Fund
    9.6%
    Robeco Capital Growth Funds - High Yield Bonds
    9.3%
    BlackRock Global High Yield Bond Fund
    8.1%
    DWS Invest Euro High Yield Corp
    7.9%
    Fidelity Funds - European High Yield Bond Fund
    7.8%
    AXA World Funds - Global High Yield Bonds
    7.8%
    Janus Henderson Horizon Global High Yield Bond Fund
    7.7%
    Schroder International Selection Fund Global High Yield
    7.7%

    Top Holdings by Country

    Europe
    36.6%
    Global
    35.9%
    International
    24.8%

    Asset Allocation

    Fund 95.9%
    Cash 2.7%
    ETF 1.4%

    Performance History (EUR)*

    1 year

    5.36%

    3 year

    13.19%

    * The Distributor Share Class (Class A) was launched on 15 September 2021.
    ** Performance figures are calculated using the Value Added Monthly Index "VAMI" principle. The VAMI calculates the total return gained by aninvestor from reinvestment of any dividends and additional interest gained through compounding.
    *** The Distributor Share Class (Class A) was launched on 15 September 2021.
    **** Returns quoted net of TER. Entry and exit charges may reduce returns for investors.

    Currency Allocation

    Euro 100.0%
    USD 0.0%
    GBP 0.0%
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