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 (“We”) will invest in collective investment schemes (“CIS”) (including UCITS, exchange-traded funds and other collective investment undertakings) that invest in a broad range of assets, including debt and equity securities. In instances, this may involve investing in CISs that are managed by the Investment Manager.

The Investment Manager (“We”) aims 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 CC 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 2022

Introduction
Market concerns, notably; lingering key macro-economic risks stemming from the war in Ukraine, monetary policy tightening as central banks continue to grapple with inflation, and a zero-tolerance coronavirus policy leading to stringent restrictions in China – threatening demand and sustaining supply-chain related disruptions, have in May continued to pose as a block to a shift in sentiment. A risk-off mode somewhat persisted, with credit market performance proving somewhat mixed.

U.S. corporate credit edged higher as treasury yields reversed some of the recent upward moves witnessed at the long-end of the curve, following a slight shift in the Fed’s tone, now seemingly more cautious as risks to growth increased. European credit remained in the red, furthering on the recent month’s negative performance.

Market environment and performance
Forward looking indicators, notably PMI data painted a somewhat mixed picture as manufacturing, albeit revised higher from initial estimate of 54.4 to 54.6, maintained its downward trend as new orders fell for the first time since June 2020 while output growth remained sluggish. Services, albeit pointing to the second-fastest expansion since September, edged lower as new business intakes, supported by a renewed increase in new orders from overseas customers, continued to rise.  Owing to a softer service sector expansion amid signs that the post lockdown rebound was losing some strength, the Eurozone Composite PMI fell to a 4-month low of 54.8.

In May, energy and food prices continued to contribute to a rise in annual inflation; a fresh record high at 8.1 per cent, in-line with expectations and marginally higher than the previous month reading of 7.4 per cent. Core inflation, which excludes transitory or temporary price volatility, rose to 3.8 per cent. Month-on-month, inflation increased by 0.8 per cent.

Aggregate business activity in the US continued to signal an expansion across the private sector. The Composite PMI reading of 53.6 however proved slightly slower than the upturn at the end of Q1 following softer data in manufacturing and services.  Notably, services came in lower at 53.40 from the previous months reading of 55.60, while manufacturing headed lower to 57.0 from 59.2 in April, pointing to the slowest albeit robust growth in factory activity since January.

Annual inflation rate in the US unexpectedly accelerated to 8.6 per cent in May, from 8.3 per cent in the previous month. The reading marked the highest since December 1981 as energy prices rose 34.6 per cent and food costs surged 10.1 per cent. Core inflation, which excludes transitory or temporary price volatility, slowed to 6.0 per cent from 6.2 per cent a month earlier.

European sovereign yields furthered on the strong upward trajectory witnessed in previous months, heading to the highest in years on expectations of a more aggressive tightening stance by the ECB, aiming to support the currency and taming inflation, in spite of concerns surrounding the Euro area growth outlook, cut to 2.7 per cent this year from the 4.0 per cent predicted earlier in February. Minutes from April’s ECB meeting revealed ECB policymakers’ worries over high inflation and agreement towards a gradual normalisation of monetary policy. After reaching a peak close of 3.13 per cent in the beginning of the month – fuelled by the Fed’s hawkish stance and rate rise by half a point to 0.75-1 per cent during its May meeting – US Treasury yields largely reversed as worries over the outlook for growth and potential to stagnate, in a period of policy tightening continued to weigh on markets. Chair of the Fed Jerome Powell stated that the central bank will not hesitate to keep raising interest rates until inflation falls in a clear and convincing way, even if that involves moving past broadly understood levels of neutral.

The yield on the 10-year German Bund, closed the month at 1.05 per cent, 12bps higher than the previous month end.  Bond yields of sovereigns within the bloc’s periphery moved in tandem, albeit some rising at somewhat faster pace. The yield on the benchmark 10-year Treasury closed the month 20bps lower than the previous month end, at 2.74 per cent.

Global high yield corporate credit, for the fifth-month running saw total negative returns, a 0.36 per cent drop.

Fund performance
Performance for the month of May was -2.62 per cent for the CC Income Portfolio Fund. The fund continued to gradually tap the market following a period in which cash was consciously maintained in order to potentially take advantage from any market weakness.

Market and investment outlook
Going forward the Manager believes that credit markets will largely remain conditioned by monetary decisions taken, thus far proving more hawkish than the economic outlook possibly warrants, altering benchmark yields, now revolving at notable highs. Such upward shift in yields, particularly at the longer-end of the yield curve – influenced by market participants – weighed on the performance of credit markets which on a year-to-date basis stand substantially negative. A prudent approach to tackling price pressures is more-than-ever imperative not to hinder growth, and thus worsen the economic situation.

Albeit economic data showed signs of weakening, inflationary pressures continued to prompt the Fed into a more aggressive path of interest rate hikes. That being said, the Fed will remain mindful that inflation may in Q3 ease should supply disruptions, a prime source of inflation, largely abate.

The Manager will continue to monitor the current unprecedented environment and take opportunities which should continue to add value to the portfolio. The recent widening in corporate credit spreads may indeed pose an opportunity, presenting attractive entry points.

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 (EUR)

ASSET CLASS

Mixed

MIN. INITIAL INVESTMENT

€5000

FUND TYPE

UCITS

BASE CURRENCY

EUR

RETURN (SINCE INCEPTION)*

-10.03%

*View Performance History below
Inception Date: 15 Sep 2021
ISIN: MT7000030680
Bloomberg Ticker: CCPISAE MV
Entry Charge: up to 2.50%
Total Expense Ratio: 1.94%
Exit Charge: None
Distribution Yield (%): -
Underlying Yield (%):
Distribution: 31/05 and 30/11
Total Net Assets: 7.31 mn
Month end NAV in EUR: 89.97
Number of Holdings: 13
Auditors: Deloitte Malta
Legal Advisor: GANADO Advocates
Custodian: Sparkasse Bank Malta p.l.c.
% of Top 10 Holdings: 81.2

Performance To Date (EUR)

Top 10 Holdings

UBS (Lux) Bond Fund - Euro High Yield
19.1%
CC Funds SICAV plc - Euro High Yield
9.8%
BlackRock Global High Yield Bond Fund
6.8%
Janus Henderson Horizon Global High Yield Bond Fund
6.7%
DWS Invest Euro High Yield Corp
6.6%
Robeco Capital Growth Funds - High Yield Bonds
6.6%
Nordea 1 - European High Yield Bond Fund
6.5%
Schroder International Selection Fund Global High Yield
6.5%
AXA World Funds - Global High Yield Bonds
6.5%
Fidelity Funds - European High Yield Bond Fund
6.1%
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

Global
35.50%
Europe
34.30%
International
19.50%

Asset Allocation

Fund 82.50%
Cash 10.70%
ETF 6.90%

Performance History (EUR)*

YTD***

-8.88%

2021

-1.26%

1-month

-2.62%

3-month

-5.75%

6-month

-8.88%

9-month

-9.73%

* 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 (“We”) will invest in collective investment schemes (“CIS”) (including UCITS, exchange-traded funds and other collective investment undertakings) that invest in a broad range of assets, including debt and equity securities. In instances, this may involve investing in CISs that are managed by the Investment Manager.

    The Investment Manager (“We”) aims 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 CC 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 2022

    Introduction
    Market concerns, notably; lingering key macro-economic risks stemming from the war in Ukraine, monetary policy tightening as central banks continue to grapple with inflation, and a zero-tolerance coronavirus policy leading to stringent restrictions in China – threatening demand and sustaining supply-chain related disruptions, have in May continued to pose as a block to a shift in sentiment. A risk-off mode somewhat persisted, with credit market performance proving somewhat mixed.

    U.S. corporate credit edged higher as treasury yields reversed some of the recent upward moves witnessed at the long-end of the curve, following a slight shift in the Fed’s tone, now seemingly more cautious as risks to growth increased. European credit remained in the red, furthering on the recent month’s negative performance.

    Market environment and performance
    Forward looking indicators, notably PMI data painted a somewhat mixed picture as manufacturing, albeit revised higher from initial estimate of 54.4 to 54.6, maintained its downward trend as new orders fell for the first time since June 2020 while output growth remained sluggish. Services, albeit pointing to the second-fastest expansion since September, edged lower as new business intakes, supported by a renewed increase in new orders from overseas customers, continued to rise.  Owing to a softer service sector expansion amid signs that the post lockdown rebound was losing some strength, the Eurozone Composite PMI fell to a 4-month low of 54.8.

    In May, energy and food prices continued to contribute to a rise in annual inflation; a fresh record high at 8.1 per cent, in-line with expectations and marginally higher than the previous month reading of 7.4 per cent. Core inflation, which excludes transitory or temporary price volatility, rose to 3.8 per cent. Month-on-month, inflation increased by 0.8 per cent.

    Aggregate business activity in the US continued to signal an expansion across the private sector. The Composite PMI reading of 53.6 however proved slightly slower than the upturn at the end of Q1 following softer data in manufacturing and services.  Notably, services came in lower at 53.40 from the previous months reading of 55.60, while manufacturing headed lower to 57.0 from 59.2 in April, pointing to the slowest albeit robust growth in factory activity since January.

    Annual inflation rate in the US unexpectedly accelerated to 8.6 per cent in May, from 8.3 per cent in the previous month. The reading marked the highest since December 1981 as energy prices rose 34.6 per cent and food costs surged 10.1 per cent. Core inflation, which excludes transitory or temporary price volatility, slowed to 6.0 per cent from 6.2 per cent a month earlier.

    European sovereign yields furthered on the strong upward trajectory witnessed in previous months, heading to the highest in years on expectations of a more aggressive tightening stance by the ECB, aiming to support the currency and taming inflation, in spite of concerns surrounding the Euro area growth outlook, cut to 2.7 per cent this year from the 4.0 per cent predicted earlier in February. Minutes from April’s ECB meeting revealed ECB policymakers’ worries over high inflation and agreement towards a gradual normalisation of monetary policy. After reaching a peak close of 3.13 per cent in the beginning of the month – fuelled by the Fed’s hawkish stance and rate rise by half a point to 0.75-1 per cent during its May meeting – US Treasury yields largely reversed as worries over the outlook for growth and potential to stagnate, in a period of policy tightening continued to weigh on markets. Chair of the Fed Jerome Powell stated that the central bank will not hesitate to keep raising interest rates until inflation falls in a clear and convincing way, even if that involves moving past broadly understood levels of neutral.

    The yield on the 10-year German Bund, closed the month at 1.05 per cent, 12bps higher than the previous month end.  Bond yields of sovereigns within the bloc’s periphery moved in tandem, albeit some rising at somewhat faster pace. The yield on the benchmark 10-year Treasury closed the month 20bps lower than the previous month end, at 2.74 per cent.

    Global high yield corporate credit, for the fifth-month running saw total negative returns, a 0.36 per cent drop.

    Fund performance
    Performance for the month of May was -2.62 per cent for the CC Income Portfolio Fund. The fund continued to gradually tap the market following a period in which cash was consciously maintained in order to potentially take advantage from any market weakness.

    Market and investment outlook
    Going forward the Manager believes that credit markets will largely remain conditioned by monetary decisions taken, thus far proving more hawkish than the economic outlook possibly warrants, altering benchmark yields, now revolving at notable highs. Such upward shift in yields, particularly at the longer-end of the yield curve – influenced by market participants – weighed on the performance of credit markets which on a year-to-date basis stand substantially negative. A prudent approach to tackling price pressures is more-than-ever imperative not to hinder growth, and thus worsen the economic situation.

    Albeit economic data showed signs of weakening, inflationary pressures continued to prompt the Fed into a more aggressive path of interest rate hikes. That being said, the Fed will remain mindful that inflation may in Q3 ease should supply disruptions, a prime source of inflation, largely abate.

    The Manager will continue to monitor the current unprecedented environment and take opportunities which should continue to add value to the portfolio. The recent widening in corporate credit spreads may indeed pose an opportunity, presenting attractive entry points.

  • 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 (EUR)

    ASSET CLASS

    Mixed

    MIN. INITIAL INVESTMENT

    €5000

    FUND TYPE

    UCITS

    BASE CURRENCY

    EUR

    RETURN (SINCE INCEPTION)*

    -10.03%

    *View Performance History below
    Inception Date: 15 Sep 2021
    ISIN: MT7000030680
    Bloomberg Ticker: CCPISAE MV
    Entry Charge: up to 2.50%
    Total Expense Ratio: 1.94%
    Exit Charge: None
    Distribution Yield (%): -
    Underlying Yield (%):
    Distribution: 31/05 and 30/11
    Total Net Assets: 7.31 mn
    Month end NAV in EUR: 89.97
    Number of Holdings: 13
    Auditors: Deloitte Malta
    Legal Advisor: GANADO Advocates
    Custodian: Sparkasse Bank Malta p.l.c.
    % of Top 10 Holdings: 81.2

    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
    19.1%
    CC Funds SICAV plc - Euro High Yield
    9.8%
    BlackRock Global High Yield Bond Fund
    6.8%
    Janus Henderson Horizon Global High Yield Bond Fund
    6.7%
    DWS Invest Euro High Yield Corp
    6.6%
    Robeco Capital Growth Funds - High Yield Bonds
    6.6%
    Nordea 1 - European High Yield Bond Fund
    6.5%
    Schroder International Selection Fund Global High Yield
    6.5%
    AXA World Funds - Global High Yield Bonds
    6.5%
    Fidelity Funds - European High Yield Bond Fund
    6.1%

    Top Holdings by Country

    Global
    35.50%
    Europe
    34.30%
    International
    19.50%

    Asset Allocation

    Fund 82.50%
    Cash 10.70%
    ETF 6.90%

    Performance History (EUR)*

    YTD***

    -8.88%

    2021

    -1.26%

    1-month

    -2.62%

    3-month

    -5.75%

    6-month

    -8.88%

    9-month

    -9.73%

    * 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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