Robeco European High Yield Bonds 0IH EUR
- Managed with a conservative approach
- Disciplined and repeatable investment process
- Experienced team management
About this fund
Price development
Performance
{{'fund.detail.general.perDate' | labelize:[ fundDate(fund.fundPerformances.date,'llll') ]}}| Fund | Index | |
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| {{'fund.detail.performance.period.sinceInception' | labelize:[ fundDate(fund.fundPerformances.sinceStart.startDate,'MM-YYYY') ]}} |
Annualized (for periods longer than one year).
Cumulized (total amount of return).
Performances are gross of fees and based on closing values. In reality, costs (such as management fees and other costs) are charged. These have a negative effect on the returns shown.
Performances are net of fees and based on transaction prices.
| Fund | Reference index | |
|---|---|---|
Annualized (for periods longer than one year).
Cumulized (total amount of return).
Performances are gross of fees and based on closing values. In reality, costs (such as management fees and other costs) are charged. These have a negative effect on the returns shown.
Performances are net of fees and based on transaction prices.
Performance explanation
{{'fund.detail.general.perDate' | labelize:[ fundDate(fund.fundInvestmentExplanations.date,'llll') ]}}Based on transaction prices, the fund's return was 6.37%. The European High Yield Index printed a total return of approximately 6% in April, bringing the YTD total return to around -9%. The main driver was the vicious rally in credit spreads, with the underlying government bonds adding a bit to the total return. The fund outperformed the index by a few basis points, depending on the share class (gross of fees). The main driver behind this outperformance was our quality bias. Though the differences between rating categories were less outspoken in Europe compared to the US. Markets continue to price in increased default risk, which is causing dispersion. The best-performing sectors were the ones hit hardest after the steep sell-off in March, namely gaming, restaurants and leisure. On an issuer level, our largest underperformer was Selecta Group. The Covid-19 outbreak is directly hurting their topline, and bonds dropped more than 50 points on the back of expected liquidity issues. Our overweight in Avis Budget Group was the second largest bleeder. The underperformance of the car rental sector is an example of the collapse in travel-related businesses. Top winners were the overweight in quality automotive exposed names such as Schaeffler and Faurecia.
Statistics
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Market development
{{'fund.detail.general.perDate' | labelize:[ fundDate(fund.fundInvestmentExplanations.date,'llll') ]}}April was the ultimate rebound month for corporate credit, as spreads tightened across the board. European high yield bonds recovered following a difficult March, as unprecedented fiscal and monetary measures by central banks and governments were enough to offset the near-term expected economic fallout from the Covid-19 outbreak. The Fed was the most aggressive central bank in the world, announcing USD 2.3 trillion in additional credit support in early April. In Europe, both the coordination of the fiscal response and the monetary response to the crisis have not met market expectations. Economic data continued to paint a very bleak picture, and the earnings season provided little to no visibility on the business climate for the next quarter. European high yield issuance remained quiet in April, although capital market conditions improved alongside market sentiment, as we saw in US primary issuance. April saw EUR 1.2 billion in issuance in European currencies and EUR 1.7 billion in issuance in Yankees. HY fund flows reversed a bit, with EUR 0.9 billion and EUR 0.5 billion of inflows into European HY Mutual Funds and ETFs. The European High Yield Index recovered close to 150 bps to 663 bps, with an average yield of 6.12%.
Fund allocation
{{'fund.detail.general.perDate' | labelize:[ fundDate(fund.fundAllocations.date,'llll') ]}}| Name | Sector | Weight |
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Fund Classification
| Yes | No | N/A | ||
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| Yes | No | N/A | ||
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| Sustainability Themed Fund |
Currency policy
All currency risks are hedged.
Derivative policy
Robeco European High Yield Bonds make use of derivatives for hedging purposes as well as for investment purposes. These derivatives are very liquid.
Dividend policy
The fund does not distribute dividend. The income earned by the fund is reflected in its share price. The fund's entire result is thus reflected in its share price development.
ESG Integration policy
Our analysis of issuers goes beyond the traditional financial factors and includes the issuers’ performance on ESG factors. We deem it essential for a well-informed investment decision to take into account those ESG factors that have the potential to materially impact the financial performance of the issuer. This perfectly matches the basic need to avoid the losers in credit management, as many credit events in the past can be attributed to issues such as poorly designed governance frameworks, environmental issues, or weak health & safety standards. The aim of ESG integration is to improve the risk/return profile of the investments and does not have an impact goal. ESG analysis is fully integrated in the bottom-up security analysis. We have defined key ESG factors per industry, and for every company we analyze how the firm is positioned versus these key ESG factors, and how this impacts the fundamental credit quality.
Investment policy
Robeco European High Yield Bonds invests in bonds with a sub-investment grade rating, issued by European issuers. The portfolio is broadly diversified across approx. 80 issuers, with a structural bias to the higher rated part in high yield (BB/B). Performance drivers are the top-down beta positioning as well as bottom-up issuer selection. Duration of the portfolio is managed in line with the index and currency exposure is hedged. The fund aims to outperform its index Barclays Pan European High Yield ex Financials 2.5% Issuer Cap. The index excludes high yield financials based on relatively high systematic risk, and applies an issuer cap to avoid concentration risk. The investment philosophy is based on managing a solid diversified portfolio with a long term view. Top-down beta positioning is based on the outcome of our credit quarterly outlook meeting, in which the team is discussing the fundamental market outlook, valuation of bond markets and market technicals. Bottom-up issuer research is executed by our credit analysts, who execute the fundamental analysis. The portfolio managers are responsible for the portfolio construction. A proprietary developed risk management approach avoids high risk concentration in the portfolio. The Robeco European High Yield fund is managed by our credit team which consists of seven portfolio managers and twelve credit analysts. Within the team, Sander Bus and Roeland Moraal are responsible for high yield. Sander has been involved in the fund since inception in 1998, Roeland joined in 2003. The portfolio managers are responsible for the construction and management of the credit portfolios, whereas the analysts cover the team's fundamental research.
Risk policy
Risk management is fully embedded in the investment process to ensure that positions always meet predefined guidelines.
Expectation of fund manager
{{'fund.detail.general.perDate' | labelize:[ fundDate(fund.fundFacts.date,'llll') ]}}The longest economic expansion has ended abruptly. The end of the expansion itself is not a surprise, but the nature of the exogenous shock, its speed and the magnitude of the slowdown are. But while Covid-19 is the proximate trigger, we firmly believe current events are not just about the virus. They have deep secular and cyclical roots. As long as the end of corona is not in sight, markets will probably remain extremely volatile. That said, markets will try to look through all the misery and will slowly price the right Covid-19 premium. This leads to increasing dispersion in HY, as markets are distinguishing between who will and will not survive. Additional monetary and fiscal support has caused markets to rally and has softened the blow for the short-term. But a deep recession, an increasing number of defaults and restructurings, and most of all lots of uncertainty will be with us for some time. Our contrarian approach is that one should trim risk when the skies are clear, and buy risk when markets panic. We increased our beta above one in March and have moved back to below one in April, after a strong reversal in spreads. Once we see spreads widening, we may consider adding more risk.
Roeland Moraal, Sander Bus
Mr. Roeland Moraal, Vice President, CEFA, Portfolio Manager. Roeland is a Senior Portfolio Manager High Yield within Robeco's Credit team since January 2004. Before assuming this role, he was portfolio manager in our Rates team for two years and worked as an analyst with the Institute for Research and Investment Services for three years. Roeland started his career in the investment industry in 1997 at Robeco. He holds a Master's degree in applied mathematics from the University of Twente and a Master's degree in Law from Erasmus University, Rotterdam. Roeland became a CEFA charter holder in 2000 and he is registered with the Dutch Securities Institute. Mr. Bus is Head of the Credit team and manages our high yield portfolios. Prior to joining Robeco in 1998, Mr. Bus worked for Rabobank as a fixed income analyst for two years. Mr. Bus holds a Master's degree in Financial Economics from Erasmus University, Rotterdam. He became a CFA charter holder in 2003 and is registered with the Dutch Securities Institute. Mr. Bus has been active in the industry since 1996.
Team
The Robeco European High Yield fund is managed within Robeco’s credit team, which consists of nine portfolio managers and twenty-three credit analysts. The portfolio managers are responsible for the construction and management of the credit portfolios, whereas the analysts cover the team’s fundamental research. Our analysts have long term experience in their respective sectors which they cover globally. Each analyst covers both investment grade and high yield, providing them an information advantage and benefiting from inefficiencies that traditionally exist between the two segmented markets. Furthermore, the credit team is supported by three dedicated quantitative researchers and four fixed income traders. On average, the members of the credit team have an experience in the asset management industry of seventeen years, of which eight years with Robeco.
Details
{{'fund.detail.general.perDate' | labelize:[ fundDate(fund.fundFacts.date,'llll') ]}}| Management company | |
| Fund capital | |
| Size of share class | |
| Outstanding shares | |
| ISIN | LU1040800143 |
| Bloomberg | REHOIHE LX |
| Valoren | 23834271 |
| WKN | A14WFK |
| Availability | |
| 1st quotation date | 1395878400000 |
| Close financial year | 31-12 |
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Cost of this fund
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Fiscal product treatment
The fund is established in Luxembourg and is subject to the Luxembourg tax laws and regulations. The fund is not liable to pay any corporation, income, dividend or capital gains tax in Luxembourg. The fund is subject to an annual subscription tax ('tax d'abonnement') in Luxembourg, which amounts to 0.01% of the net asset value of the fund. This tax is included in the net asset value of the fund. The fund can in principle use the Luxembourg treaty network to partially recover any withholding tax on its income.
Fiscal treatment of investor
Investors who are not subject to (exempt from) Dutch corporate-income tax (e.g. pension funds) are not taxed on the achieved result. Investors who are subject to Dutch corporate-income tax can be taxed for the result achieved on their investment in the fund. Dutch bodies that are subject to corporate-income tax are obligated to declare interest and dividend income, as well as capital gains in their tax return. Investors residing outside the Netherlands are subject to their respective national tax regime applying to foreign investment funds. We advise individual investors to consult their financial or tax adviser about the tax consequences of an investment in this fund in their specific circumstances before deciding to invest in the fund.
