Investment Objectives

The Fund aims to maximise the total level of return for investors through investment, primarily, in debt securities and money market instruments issued by the Government of Malta. The Investment Manager may also invest directly or indirectly via eligible ETFs and/or eligible CISs) up to 15% of its assets in “Non-Maltese Assets” in debt securities and/or money market instruments issued or guaranteed by Governments of EU, EEA and OECD Member States other than Malta. The Investment Manager will not be targeting debt securities of any particular duration, coupon or credit rating.

The Fund is actively managed, not managed by reference to any index.

 

Investor Profile

A typical investor in the Malta Government Bond Fund would be one who is seeking to gain exposure to the local Government Bond Market whilst seeking to accumulate wealth and save over time in a product that re-invests coupons received on a gross basis. Furthermore, investors in the Malta Government Bond Fund are those who are planning to hold on to their investment for the medium-to-long term so as to benefit from the compound interest effect whilst also participating in the interest rate cycle.

Fund Rules

The Investment Manager will invest primarily in a portfolio of debt securities and money market instruments issued or guaranteed by the Government of Malta. The Investment Manager may invest directly in eligible collective investment schemes whose investment objective and policies are consistent with those of the Sub-Fund. The Investment Manager may also invest directly (or indirectly via eligible exchange traded funds and/or eligible collective investment schemes) up to 15% of its assets in “Non-Maltese Assets” as per below:

  • Debt securities and/or money market instruments issued or guaranteed by Governments of EU, EEA and OECD Member States other than Malta, their constituent states or their local authorities; and/or
  • Debt securities and/or money market instruments issued or guaranteed by supranational bodies of EU, EEA and OECD Member States other than Malta, their agencies, associated financial institutions or other associated bodies.
    The Investment Manager will not be targeting debt securities (including, money market instruments, bonds, notes and other debt securities) of any particular duration, coupon or credit rating. The Sub-Fund may also invest in term deposits held with credit institutions regulated in Malta and other EU, EEA and OECD Member States.

For temporary and/or defensive purposes, the Sub-Fund may invest in other short-term debt securities or fixed income instruments, money market funds, cash and cash equivalents. The Sub-Fund may also at any time hold such securities for cash management purposes, pending investment in accordance with its Investment Policy and to meet operating expenses and redemption requests.

In pursuing its Investment Objective and Investment Policy, the Sub-Fund will be subject to the Investment, Borrowing and Leverage Restrictions set out in the Prospectus and the Offering Supplement. Furthermore, this Sub-Fund shall not invest, in the aggregate, more than 10% of its assets in units or shares of other UCITS or other CISs. The Investment Manager may make use of listed and OTC FDIs (including, but not limited to, futures, forwards, options and swaps) linked to bonds, interest rates and currencies for efficient portfolio management,  hedging purposes and the reduction of risk only. The Sub-Fund will not make use of FDIs for investment purposes. 

Commentary

June 2025

Introduction

In 2025, Malta’s economy sustained its growth trajectory, albeit noting a marginal slowdown in household consumption (0.8% vs. 2.5% in Q4), and government spending (0.6% vs. 2.2%). On the trade side, both exports and imports grew, yet at a slower pace. In numbers, GDP expanded by 3.0% year-on-year (annualized) in the first quarter of 2025, slowing from an upwardly revised 3.1% increase in the previous three-month period, and marking the weakest economic growth since the third quarter of 2022.

Inflationary pressures on consumers intensified, as the annual inflation rate climbed to 2.7% in May from 2.6% in April, the highest level since March 2024. This rise was largely driven by accelerated price increases in food and non-alcoholic beverages, miscellaneous goods and services, and restaurants and hotels.

Market environment and performance

In the euro area, economic performance surprised to the upside. Q1 2025 GDP was revised up to 0.6%, double the initial estimate of 0.3%, marking the strongest quarterly expansion since Q3 2022. The revision was driven by exceptional growth in Ireland and stronger-than-expected results from Germany and Spain.

Forward-looking indicators, however, pointed to more muted momentum. The HCOB Eurozone Composite PMI held steady at 50.2 in June, unchanged from the prior month and just below the 50.5 flash estimate, indicating ongoing but subdued expansion. This marked the sixth consecutive month above the 50.0 expansion threshold. Services sector activity stagnated, while manufacturing – albeit consistently improving – signaled a slight downturn in manufacturing conditions.

Euro area Inflation across the bloc also moderated, with May data showing a decline to 1.9%, an eight-month low and below the ECB’s 2.0% medium-term target. The decline reinforced market confidence that the disinflationary trend is intact.

Fund performance

The CC Malta Government Bond Fund gained a marginal 0.07% in June, despite a broader decline in yields across European government bonds.

Market and investment outlook

The credit market narrative that began the year – with a focus on political uncertainty and central bank policy – remained prominent into Q2. Political tensions escalated as former President Trump adopted a more aggressive stance on tariffs, though this was later moderated with a 90-day pause. Meanwhile, central bank policies diverged: the Federal Reserve kept rates steady amid persistent inflation and signs of slowing growth, while the ECB continued to ease policy, with weakening euro area growth, a sustained disinflation trend supported by a stronger euro, lower energy prices, and rising U.S. tariffs, at the backdrop of such policy decisions.

These monetary policy shifts contributed to a divergence in bond market performance, with European sovereign debt outperforming as yields broadly tightened throughout Q2—despite a late-month reversal that was not enough to offset earlier gains. Malta’s yield curve followed suit, particularly on the long end, which saw a marked decline since the end of Q1 2025.

Looking ahead, Malta’s economy is expected to remain robust through 2025. Inflation remains low despite more recent upticks, and recent tax cuts are likely to support domestic consumption. The anticipated rise in tourist arrivals heading into peak season also bodes well for continued economic momentum.

In response to these developments, we will continue adjusting the portfolio’s duration as appropriate and maintain exposure to European sovereigns, utilizing the allowable 15% allocation.

A quick introduction to our Malta Government 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

Bonds

MIN. INITIAL INVESTMENT

€2500

FUND TYPE

UCITS

BASE CURRENCY

EUR

5 year performance*

-8.51%

*View Performance History below
Inception Date: 21 Apr 2017
ISIN: MT7000017992
Bloomberg Ticker: CCMGBFA MV
Distribution Yield (%): N/A
Underlying Yield (%): 3.51
Distribution: N/A
Total Net Assets: €24.04 mn
Month end NAV in EUR: 98.38
Number of Holdings: 37
Auditors: Grant Thornton
Legal Advisor: Ganado Advocates
Custodian: Sparkasse Bank Malta p.l.c.

Performance To Date (EUR)

Top 10 Holdings

5.25% MGS 2030
10.3%
1.00% MGS 2031
10.2%
4.50% MGS 2028
9.8%
4.45% MGS 2032
7.4%
4.00% MGS 2033
5.3%
4.30% MGS 2033
5.3%
5.20% MGS 2031
4.9%
5.10% MGS 2029
4.6%
4.10% MGS 2034
4.0%
4.65% MGS 2032
3.9%
Data for major sector breakdown is not available for this fund.

Maturity Buckets*

30.5%
0-5 Years
58.2%
5-10 Years
9.1%
10 Years+
*based on the Next Call Date (also includes cash)
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*

Malta
85.4%
Belgium
2.1%
Portugal
1.8%
Italy
1.5%
France
1.3%
Slovenia
1.0%
Hungary
0.9%
Croatia
0.9%
Poland
0.9%
Germany
0.9%
*including exposures to CIS

Asset Allocation

Cash 0.6%
Bonds 97.9%
CIS/ETFs 1.6%

Performance History (EUR)*

1 Year

4.75%

3 Year

3.11%

5 Year

-8.51%

* The Accumulator Share Class (Class A) was launched on 21 April 2017.
** Returns quoted net of TER. Entry and exit charges may reduce returns for investors.
*** The Annualised rate is an indication of the average growth of the Fund over one year. The value of the investment and the income yield derived from the investment, if any, may go down as well as up and past performance is not necessarily indicative of future performance, nor a reliable guide to future performance. Hence returns may not be achieved and you may lose all or part of your investment in the Fund. Currency fluctuations may affect the value of investments and any derived income.

Currency Allocation

Euro 99.1%
USD 0.9%
Data for risk statistics is not available for this fund.

Interested in this product?

  • Investment Objectives

    The Fund aims to maximise the total level of return for investors through investment, primarily, in debt securities and money market instruments issued by the Government of Malta. The Investment Manager may also invest directly or indirectly via eligible ETFs and/or eligible CISs) up to 15% of its assets in “Non-Maltese Assets” in debt securities and/or money market instruments issued or guaranteed by Governments of EU, EEA and OECD Member States other than Malta. The Investment Manager will not be targeting debt securities of any particular duration, coupon or credit rating.

    The Fund is actively managed, not managed by reference to any index.

     

  • Investor profile

    A typical investor in the Malta Government Bond Fund would be one who is seeking to gain exposure to the local Government Bond Market whilst seeking to accumulate wealth and save over time in a product that re-invests coupons received on a gross basis. Furthermore, investors in the Malta Government Bond Fund are those who are planning to hold on to their investment for the medium-to-long term so as to benefit from the compound interest effect whilst also participating in the interest rate cycle.

    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

    June 2025

    Introduction

    In 2025, Malta’s economy sustained its growth trajectory, albeit noting a marginal slowdown in household consumption (0.8% vs. 2.5% in Q4), and government spending (0.6% vs. 2.2%). On the trade side, both exports and imports grew, yet at a slower pace. In numbers, GDP expanded by 3.0% year-on-year (annualized) in the first quarter of 2025, slowing from an upwardly revised 3.1% increase in the previous three-month period, and marking the weakest economic growth since the third quarter of 2022.

    Inflationary pressures on consumers intensified, as the annual inflation rate climbed to 2.7% in May from 2.6% in April, the highest level since March 2024. This rise was largely driven by accelerated price increases in food and non-alcoholic beverages, miscellaneous goods and services, and restaurants and hotels.

    Market environment and performance

    In the euro area, economic performance surprised to the upside. Q1 2025 GDP was revised up to 0.6%, double the initial estimate of 0.3%, marking the strongest quarterly expansion since Q3 2022. The revision was driven by exceptional growth in Ireland and stronger-than-expected results from Germany and Spain.

    Forward-looking indicators, however, pointed to more muted momentum. The HCOB Eurozone Composite PMI held steady at 50.2 in June, unchanged from the prior month and just below the 50.5 flash estimate, indicating ongoing but subdued expansion. This marked the sixth consecutive month above the 50.0 expansion threshold. Services sector activity stagnated, while manufacturing – albeit consistently improving – signaled a slight downturn in manufacturing conditions.

    Euro area Inflation across the bloc also moderated, with May data showing a decline to 1.9%, an eight-month low and below the ECB’s 2.0% medium-term target. The decline reinforced market confidence that the disinflationary trend is intact.

    Fund performance

    The CC Malta Government Bond Fund gained a marginal 0.07% in June, despite a broader decline in yields across European government bonds.

    Market and investment outlook

    The credit market narrative that began the year – with a focus on political uncertainty and central bank policy – remained prominent into Q2. Political tensions escalated as former President Trump adopted a more aggressive stance on tariffs, though this was later moderated with a 90-day pause. Meanwhile, central bank policies diverged: the Federal Reserve kept rates steady amid persistent inflation and signs of slowing growth, while the ECB continued to ease policy, with weakening euro area growth, a sustained disinflation trend supported by a stronger euro, lower energy prices, and rising U.S. tariffs, at the backdrop of such policy decisions.

    These monetary policy shifts contributed to a divergence in bond market performance, with European sovereign debt outperforming as yields broadly tightened throughout Q2—despite a late-month reversal that was not enough to offset earlier gains. Malta’s yield curve followed suit, particularly on the long end, which saw a marked decline since the end of Q1 2025.

    Looking ahead, Malta’s economy is expected to remain robust through 2025. Inflation remains low despite more recent upticks, and recent tax cuts are likely to support domestic consumption. The anticipated rise in tourist arrivals heading into peak season also bodes well for continued economic momentum.

    In response to these developments, we will continue adjusting the portfolio’s duration as appropriate and maintain exposure to European sovereigns, utilizing the allowable 15% allocation.

  • 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

    Bonds

    MIN. INITIAL INVESTMENT

    €2500

    FUND TYPE

    UCITS

    BASE CURRENCY

    EUR

    5 year performance*

    -8.51%

    *View Performance History below
    Inception Date: 21 Apr 2017
    ISIN: MT7000017992
    Bloomberg Ticker: CCMGBFA MV
    Distribution Yield (%): N/A
    Underlying Yield (%): 3.51
    Distribution: N/A
    Total Net Assets: €24.04 mn
    Month end NAV in EUR: 98.38
    Number of Holdings: 37
    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

    5.25% MGS 2030
    10.3%
    1.00% MGS 2031
    10.2%
    4.50% MGS 2028
    9.8%
    4.45% MGS 2032
    7.4%
    4.00% MGS 2033
    5.3%
    4.30% MGS 2033
    5.3%
    5.20% MGS 2031
    4.9%
    5.10% MGS 2029
    4.6%
    4.10% MGS 2034
    4.0%
    4.65% MGS 2032
    3.9%

    Top Holdings by Country*

    Malta
    85.4%
    Belgium
    2.1%
    Portugal
    1.8%
    Italy
    1.5%
    France
    1.3%
    Slovenia
    1.0%
    Hungary
    0.9%
    Croatia
    0.9%
    Poland
    0.9%
    Germany
    0.9%
    *including exposures to CIS

    Asset Allocation

    Cash 0.6%
    Bonds 97.9%
    CIS/ETFs 1.6%

    Maturity Buckets*

    30.5%
    0-5 Years
    58.2%
    5-10 Years
    9.1%
    10 Years+
    *based on the Next Call Date (also includes cash)

    Performance History (EUR)*

    1 Year

    4.75%

    3 Year

    3.11%

    5 Year

    -8.51%

    * The Accumulator Share Class (Class A) was launched on 21 April 2017.
    ** Returns quoted net of TER. Entry and exit charges may reduce returns for investors.
    *** The Annualised rate is an indication of the average growth of the Fund over one year. The value of the investment and the income yield derived from the investment, if any, may go down as well as up and past performance is not necessarily indicative of future performance, nor a reliable guide to future performance. Hence returns may not be achieved and you may lose all or part of your investment in the Fund. Currency fluctuations may affect the value of investments and any derived income.

    Currency Allocation

    Euro 99.1%
    USD 0.9%
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