Robeco European High Yield Bonds DH 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 | |
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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 0.61%. The European high yield market delivered +0.58% and +0.54% in total and excess returns in June, respectively. Underlying government bonds made a flat contribution to total returns. The fund outperformed the index in June by 4 bps (gross of fees), which can mainly be attributed to issuer selection (+15 bps). Our rating allocation (up in quality) also added a few basis points to our relative performance, while single Bs and CCCs underperformed slightly on a risk-adjusted basis. All sectors in European high yield had a positive excess return, with energy being the top-performing sector on the back of continuing oil price improvement. We were very active in new issuance last month. A few names that we played and that moved up on re-offer were Nomad foods, Paprec, Ontex and Virgin Media. On an issuer level, we benefited from our underweight in SoftBank (+2 bps). Anglian waters was the largest gainer for the month – its bonds jumped 4 basis points as annual results surprised on the upside. Issuers that detracted from our relative performance (max 1 bp) were Tata Motors (UW), Primo Water (OW) and Ford (UW).
Statistics
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Market development
{{'fund.detail.general.perDate' | labelize:[ fundDate(fund.fundInvestmentExplanations.date,'llll') ]}}European high yield bond spreads managed to tighten to a record low of 288 bps in June, reaching a level last seen in October 2018. All asset classes rallied amid growing confidence that inflation will prove to be transitory – meaning no surprise reaction from central banks. Bunds moved more or less sideways for the month. The Fed struck a more-than-expected hawkish tone in its FOMC minutes. The most interesting observation was that the interest rate forecast for 2023 shows two rate hikes, with the first one ultimo 2022. Vaccination rollouts and the reopening of travel seems to be on track in Europe, as the holiday season is approaching quickly. On a global scale, we saw commodity prices hitting new highs in the past few weeks. That also holds a bit for the compression trade, as BBs performed in line with Bs (both 0.6%), outperforming CCCs that delivered 0.4% in total returns. Top-performing sectors were energy (+1.6%), metals & mining (+1.3%) and lodging (+0.9%). June saw EUR 16.4 billion of issuance, delivering the strongest month on record since 2006. The average yield to worst for the European High Yield Index ended the month at 2.54% with an average spread of 288 bps.
Fund allocation
{{'fund.detail.general.perDate' | labelize:[ fundDate(fund.fundAllocations.date,'llll') ]}}| Name | Sector | Weight |
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Fund Classification
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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 is an actively managed fund that invests in bonds with a sub-investment grade rating, issued primarily by European and US issuers. The selection of these bonds is based on fundamental analysis. The fund's objective is to provide long term capital growth.The fund aims for a better sustainability profile compared to the Benchmark by promoting certain ESG (i.e. Environmental, Social and corporate Governance) characteristics within the meaning of Article 8 of the European Sustainable Finance Disclosure Regulation and integrating ESG and sustainability risks in the investment process. In addition, the fund applies an exclusion list on the basis of controversial behavior, products (including controversial weapons, tobacco, palm oil and fossil fuel) and countries, next to engagement. The portfolio is broadly diversified, 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.The majority of bonds selected will be components of the Benchmark, but bonds outside the Benchmark may be selected too. The fund can deviate substantially from the weightings of the Benchmark. The fund aims to outperform the Benchmark over the long run, whilst still controlling relative risk through the applications of limits (on currencies and issuers) to the extent of deviation from the Benchmark. This will consequently limit the deviation of the performance relative to the Benchmark. The Benchmark is a broad market weighted index that is not consistent with the ESG characteristics promoted by the fund.
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') ]}}A few things are clear. Barring accidents, the US should print a 10% nominal GDP growth number this year. That said, growth in industrial production seems to be peaking and the fiscal impulse is set to roll over, first in China, then in the US. This means markets are priced for the current perfect recovery but not for future uncertainty. One could wonder why yields do not rise much more in a year of 10% nominal growth. It is interesting that the Fed put a lot of effort into convincing the market that it will let the economy run hot. It even changed its policy framework last year, to allow for a more symmetric inflation acceptance. Now, inflation rates are rising in the US, with a recent 5% CPI print. Having previously stated that they think this will prove transitory, the Fed last week rowed back from this position. The talk about the talk about when to start tapering had been expected. We expect taper talks will intensify over Q3. It means that plain sailing is over and that we have to be open to a reversal of events. We do not think risk premiums reflect this. The room for error has become smaller again. We are not running huge underweight in betas but are simply just below one.
Roeland Moraal, Sander Bus
Roeland Moraal is Lead Portfolio Manager European High Yield in the Credit team. Before assuming this role, he was Portfolio Manager in the Robeco Duration team and worked as an Analyst with the Institute for Research and Investment Services. Roeland started his career in the industry in 1997. He holds a Master's in Applied Mathematics from the University of Twente and a Master’s in Law from Erasmus University Rotterdam. Sander Bus is Co-Head of the Credit team and Lead Portfolio Manager Global High Yield Bonds. He has been dedicated to High Yield at Robeco since 1998. Previously, Sander worked for two years as a Fixed Income Analyst at Rabobank where he started his career in the industry in 1996. He holds a Master's in Financial Economics from Erasmus University Rotterdam and is a CFA® charterholder.
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 | LU0226953981 |
| Bloomberg | RGCEHBD LX |
| Valoren | 2242471 |
| WKN | A0HGD6 |
| Availability | |
| 1st quotation date | 1128297600000 |
| 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 0.05% 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
The fiscal consequences of investing in this fund depend on the investor's personal situation. For private investors in the Netherlands real interest and dividend income or capital gains received on their investments are not relevant for tax purposes. Each year investors pay income tax on the value of their net assets as at 1 January if and inasmuch as such net assets exceed the investor’s tax-free allowance. Any amount invested in the fund forms part of the investor's net assets. Private investors who are resident outside the Netherlands will not be taxed in the Netherlands on their investments in the fund. However, such investors may be taxed in their country of residence on any income from an investment in this fund based on the applicable national fiscal laws. Other fiscal rules apply to legal entities or professional investors. We advise 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.
