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
- 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.
- 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.
- 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.
- 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.
A quick introduction to our Global High Income Bond Fund
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 (%): 2.00
Underlying Yield (%): -
Distribution: 31/05 and 30/11
Total Net Assets: 6.56 mn
Month end NAV in EUR: 91.28
Number of Holdings: 13
Auditors: Deloitte Malta
Legal Advisor: GANADO Advocates
Custodian: Sparkasse Bank Malta p.l.c.
Performance To Date (EUR)
Top 10 Holdings
19.9%
10.3%
8.9%
8.7%
7.6%
7.3%
7.1%
7.0%
7.0%
5.9%
Risk & Reward Profile
Lower Risk
Potentialy Lower Reward
Higher Risk
Potentialy Higher Reward
Top Holdings by Country
38.40%
37.90%
22.80%
Asset Allocation
Performance History (EUR)*
1Y
9.13%
3Y
-%
5Y
-%
Currency Allocation
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
-
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
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Commentary
March 2024
Introduction
The first quarter of 2024 defied some pre-existing expectations of a pronounced economic slowdown. Equity markets displayed continued strength, with the S&P 500 closing at a record high early in the period. However, credit markets experienced intermittent bouts of volatility, highlighting the inherent disconnect in risk pricing between asset classes. Notwithstanding headwinds faced, credit markets delivered positive returns, overall.
From a macroeconomic perspective, data remained generally supportive, proving particularly kind for central banks as developed economies maintained a positive growth momentum, avoiding a steeper downturn. Inflation, though persistent, showed nascent signs of peaking. The labour market, previously characterized by tightness, exhibited signs of easing, with wage growth decelerating. Economic activity continued at a healthy pace, albeit with some regional variations. European economies witnessed a near-stabilization of activity, with the tentative signs of a recovery observed at the start of the year carrying over. The pace however remains uncertain as the bloc’s largest economies struggled to turn the corner.
Market environment and performance
The Eurozone economy in March 2024 presented a picture of continued, albeit moderating, recovery. Eurostat’s preliminary estimates indicate Q1 2024 growth of 0.3% QoQ, a slight deceleration from the previous quarter’s 0.5% QoQ growth.
Indeed, the Euro area economy moved closer to stabilization in March, Purchasing Managers’ Index (PMI) survey showed, amid a modest recovery in services (reading 51.1 v 50.2), largely offsetting the weakening manufacturing segment (reading 45.7 v 46.5). Overall, new orders declined at the slowest rate in ten months, and backlogs of work were depleted at the weakest rate in nine months, while employment saw modest growth. On the price front, input cost inflation slowed to a three-month low, and selling price inflation cooled for the first time in five months. Finally, business confidence improved to its strongest level in a year.
Inflation, a key concern for policy makers, eased. Headline HICP inflation declined to 2.4% year-on-year in March, below expectations and down marginally from February’s 2.6%. The core rate, excluding volatile food and energy prices, also cooled to 2.9%, below forecasts and its lowest point since February 2022. Meanwhile, the Eurozone labor market displayed continued strength with unemployment rate (6.5%) holding steady near historical lows. However, the absence of wage growth data limits a full assessment of its inflationary impact.
The ECB Governing Council, in its March meeting, held the main refinancing operations rate steady at 4.5%, committing to a data-dependent approach to determine the appropriate level and duration of restriction. President Lagarde acknowledged a lack of clear conviction within the Council, indicating a need for “more evidence, more data”. Additionally, Lagarde remarks that governing council “will know a little more in April, but we will know a lot more in June”.
The U.S. economy continued to defy some earlier forecasts of a slowdown, displaying signs of continued strength. Consumer spending, business activity, and employment all indicated a healthy expansion to start the year, advancing on an upwardly revised 3.4% QoQ growth in Q4 2023. The labour market remained particularly robust, with the March jobs report showing a significant increase in nonfarm payroll jobs and sustained low unemployment rate. Meanwhile, wage growth eased, with average hourly earnings increasing by 4.1% YoY, following a 4.3% advance in the prior month and also matching market estimates. On the inflation front, data proved largely mixed with leading indicators offsetting worries of continued elevated price pressures. Notably, annual headline inflation accelerated for a second successive month to 3.5%, the highest since September 2023, compared to February’s 3.2% and forecasts of 3.4%. Core inflation, which excludes volatile items, stood at a near three-year low of 3.8%. Other price indicators, notably the leading producer prices MoM figure rose 0.2%, the smallest increase in three months.
In March, Government bond yields fell, meaning prices rose as the market continued to anticipate interest rate cuts, as labour market tightness eased and inflation showed optimistic signs. Corporate credit, albeit varied across rating buckets, marginally outperformed. Investment grade ended the month higher, with European IG outperforming its US counterpart. Meanwhile, global high yield (+1.06%) – aided by the lower duration and easier financial conditions – was once again a positive contributor to the fixed income segment, generating positive returns.
Fund performance
Performance for the month of March proved positive, noting a 0.38% gain for the CC Income Strategy Fund, in-line with the positive performance across global high yield credit during such period.
Market and investment outlook
Hopes for a rapid end to interest rate hikes faded in Q1 as central bankers reiterated their commitment to data-driven policy decisions and emphasized the continued threat of inflation. Despite reaching peak levels and inflation sustaining a downward trend, Fed Chair Jerome Powell stated that rate cuts in March were unlikely. Similarly, while acknowledging progress in “disinflation,” ECB President Christine Lagarde stressed that discussions of easing policy were as yet premature. A divergent tone was observed in the March’s meeting, with policy makers hinting at possible easing in June as data converges towards targets. The key challenge for policy makers currently is balancing continued high interest rates with supporting economic growth. The euro area, unlike its Western counterparts, faces an additional headwind whereby key economies, traditionally bolstering the single currency bloc, are now dragging down and offsetting a gathering upturn in the rest of the eurozone, pointing to an uneven economic picture.
Fixed income, for years losing its appeal – given the relatively low-yielding environment – has become more attractive. Indeed, locking in coupons at such comparably favorable levels, ahead of any policy easing, is key.
That said, the manager will going forward continue to assess the market landscape and capitalize on appealing credit opportunities. Consistent with recent actions, the manager will continue to tailor the portfolio to match prevailing yield conditions while increasing the portfolio’s overall duration in a gradual manner. Optimism for the year ahead remains on the back of continued rate cut expectations.
-
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 (%): 2.00
Underlying Yield (%): -
Distribution: 31/05 and 30/11
Total Net Assets: 6.56 mn
Month end NAV in EUR: 91.28
Number of Holdings: 13
Auditors: Deloitte Malta
Legal Advisor: GANADO Advocates
Custodian: Sparkasse Bank Malta p.l.c.
Performance To Date (EUR)
Risk & Reward Profile
1234567Lower Risk
Potentialy Lower Reward
Higher Risk
Potentialy Higher Reward
Top 10 Holdings
UBS (Lux) Bond Fund - Euro High Yield19.9%
CC Funds SICAV plc - High Income Bond Fund10.3%
Nordea 1 - European High Yield Bond Fund8.9%
Robeco Capital Growth Funds - High Yield Bonds8.7%
DWS Invest Euro High Yield Corp7.6%
BlackRock Global High Yield Bond Fund7.3%
Janus Henderson Horizon Global High Yield Bond Fund7.1%
Schroder International Selection Fund Global High Yield7.0%
AXA World Funds - Global High Yield Bonds7.0%
Fidelity Funds - European High Yield Bond Fund5.9%
Top Holdings by Country
Europe38.40%
Global37.90%
International22.80%
Asset Allocation
Fund 92.20%ETF 6.90%Cash 1.00%Performance History (EUR)*
1Y
9.13%
3Y
-%
5Y
-%
* 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% -
Downloads
Commentary
March 2024
Introduction
The first quarter of 2024 defied some pre-existing expectations of a pronounced economic slowdown. Equity markets displayed continued strength, with the S&P 500 closing at a record high early in the period. However, credit markets experienced intermittent bouts of volatility, highlighting the inherent disconnect in risk pricing between asset classes. Notwithstanding headwinds faced, credit markets delivered positive returns, overall.
From a macroeconomic perspective, data remained generally supportive, proving particularly kind for central banks as developed economies maintained a positive growth momentum, avoiding a steeper downturn. Inflation, though persistent, showed nascent signs of peaking. The labour market, previously characterized by tightness, exhibited signs of easing, with wage growth decelerating. Economic activity continued at a healthy pace, albeit with some regional variations. European economies witnessed a near-stabilization of activity, with the tentative signs of a recovery observed at the start of the year carrying over. The pace however remains uncertain as the bloc’s largest economies struggled to turn the corner.
Market environment and performance
The Eurozone economy in March 2024 presented a picture of continued, albeit moderating, recovery. Eurostat’s preliminary estimates indicate Q1 2024 growth of 0.3% QoQ, a slight deceleration from the previous quarter’s 0.5% QoQ growth.
Indeed, the Euro area economy moved closer to stabilization in March, Purchasing Managers’ Index (PMI) survey showed, amid a modest recovery in services (reading 51.1 v 50.2), largely offsetting the weakening manufacturing segment (reading 45.7 v 46.5). Overall, new orders declined at the slowest rate in ten months, and backlogs of work were depleted at the weakest rate in nine months, while employment saw modest growth. On the price front, input cost inflation slowed to a three-month low, and selling price inflation cooled for the first time in five months. Finally, business confidence improved to its strongest level in a year.
Inflation, a key concern for policy makers, eased. Headline HICP inflation declined to 2.4% year-on-year in March, below expectations and down marginally from February’s 2.6%. The core rate, excluding volatile food and energy prices, also cooled to 2.9%, below forecasts and its lowest point since February 2022. Meanwhile, the Eurozone labor market displayed continued strength with unemployment rate (6.5%) holding steady near historical lows. However, the absence of wage growth data limits a full assessment of its inflationary impact.
The ECB Governing Council, in its March meeting, held the main refinancing operations rate steady at 4.5%, committing to a data-dependent approach to determine the appropriate level and duration of restriction. President Lagarde acknowledged a lack of clear conviction within the Council, indicating a need for “more evidence, more data”. Additionally, Lagarde remarks that governing council “will know a little more in April, but we will know a lot more in June”.
The U.S. economy continued to defy some earlier forecasts of a slowdown, displaying signs of continued strength. Consumer spending, business activity, and employment all indicated a healthy expansion to start the year, advancing on an upwardly revised 3.4% QoQ growth in Q4 2023. The labour market remained particularly robust, with the March jobs report showing a significant increase in nonfarm payroll jobs and sustained low unemployment rate. Meanwhile, wage growth eased, with average hourly earnings increasing by 4.1% YoY, following a 4.3% advance in the prior month and also matching market estimates. On the inflation front, data proved largely mixed with leading indicators offsetting worries of continued elevated price pressures. Notably, annual headline inflation accelerated for a second successive month to 3.5%, the highest since September 2023, compared to February’s 3.2% and forecasts of 3.4%. Core inflation, which excludes volatile items, stood at a near three-year low of 3.8%. Other price indicators, notably the leading producer prices MoM figure rose 0.2%, the smallest increase in three months.
In March, Government bond yields fell, meaning prices rose as the market continued to anticipate interest rate cuts, as labour market tightness eased and inflation showed optimistic signs. Corporate credit, albeit varied across rating buckets, marginally outperformed. Investment grade ended the month higher, with European IG outperforming its US counterpart. Meanwhile, global high yield (+1.06%) – aided by the lower duration and easier financial conditions – was once again a positive contributor to the fixed income segment, generating positive returns.
Fund performance
Performance for the month of March proved positive, noting a 0.38% gain for the CC Income Strategy Fund, in-line with the positive performance across global high yield credit during such period.
Market and investment outlook
Hopes for a rapid end to interest rate hikes faded in Q1 as central bankers reiterated their commitment to data-driven policy decisions and emphasized the continued threat of inflation. Despite reaching peak levels and inflation sustaining a downward trend, Fed Chair Jerome Powell stated that rate cuts in March were unlikely. Similarly, while acknowledging progress in “disinflation,” ECB President Christine Lagarde stressed that discussions of easing policy were as yet premature. A divergent tone was observed in the March’s meeting, with policy makers hinting at possible easing in June as data converges towards targets. The key challenge for policy makers currently is balancing continued high interest rates with supporting economic growth. The euro area, unlike its Western counterparts, faces an additional headwind whereby key economies, traditionally bolstering the single currency bloc, are now dragging down and offsetting a gathering upturn in the rest of the eurozone, pointing to an uneven economic picture.
Fixed income, for years losing its appeal – given the relatively low-yielding environment – has become more attractive. Indeed, locking in coupons at such comparably favorable levels, ahead of any policy easing, is key.
That said, the manager will going forward continue to assess the market landscape and capitalize on appealing credit opportunities. Consistent with recent actions, the manager will continue to tailor the portfolio to match prevailing yield conditions while increasing the portfolio’s overall duration in a gradual manner. Optimism for the year ahead remains on the back of continued rate cut expectations.