Robeco Global Total Return Bond Fund EH EUR

Bob Stoutjesdijk is Portfolio Manager and member of Robeco’s Global Macro team. He joined Robeco in 2019. He worked at Shell Asset Management Company as Portfolio Manager Fixed Income Sovereign Credit in the period 2011-2019. Prior to that, he was Portfolio Manager Fixed Income at SNS Asset Management. He started his career as Quantitative Analyst at APG Asset Management in 2008. Bob has a Master’s in Economics & Business from Erasmus University Rotterdam and is a CAIA® Charterholder. Michiel de Bruin is Head of Global Macro and Portfolio Manager. Prior to joining Robeco in 2018, Michiel was Head of Global Rates and Money Markets at BMO Global Asset Management in London. He held various other positions before that, including Head of Euro Government Bonds. Before he joined BMO in 2003, he was, among others, Head of Fixed Income Trading at Deutsche Bank in Amsterdam. Michiel started his career in the industry in 1986. He holds a post graduate diploma investment analyses from the VU University in Amsterdam and is a Certified EFFAS Analyst (CEFA) charterholder. He holds a Bachelor’s in Applied Sciences from University of Applied Sciences in Amsterdam. Stephan van IJzendoorn is Portfolio Manager and member of Robeco’s Global Macro team. Prior to joining Robeco in 2013, Stephan was employed by F&C Investments as a Portfolio Manager Fixed Income and worked in similar functions at Allianz Global Investors and A&O Services prior to that. Stephan started his career in the Investment Industry in 2003. He holds a Bachelor’s in Financial Management, a Master's in Investment Management from VU University Amsterdam and is Certified European Financial Analyst (CEFA) Charterholder.

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.

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.

The fund incorporates sustainability in the investment process via exclusions, negative screening, ESG integration, limits on investments in companies and countries based on ESG performance as well as engagement and a minimum allocation to ESG-labeled bonds. For government and government-related bonds, the fund complies with Robeco’s exclusion policy for countries, excludes the 15% worst ranked countries following the World Governance Indicator 'Control of Corruption', and ensures investments have a minimum weighted average score of 6 following Robeco's proprietary Country Sustainability Ranking. The Country Sustainability Ranking scores countries on a scale from 1 (worst) to 10 (best) based on 40 environmental, social, and governance indicators. For corporate bonds, the fund does not invest in credit issuers that are in breach of international norms or where activities have been deemed detrimental to society following Robeco's exclusion policy. ESG factors are integrated in the bottom-up security analysis to assess the impact on the issuer's fundamental credit quality. In the credit selection the fund limits exposure to issuers with an elevated sustainability risk profile. Where issuers are flagged for breaching international standards in the ongoing monitoring, the issuer will become subject to engagement. Lastly, the fund invests in a minimum of 2.5% in green, social, sustainable and/or sustainability-linked bonds. The following sections display the ESG-metrics for this fund along with short descriptions. For more information please visit the sustainability-related disclosures.

August was a very positive month for nearly all government bond markets. Especially short maturity government bond yields declined. 2-year US Treasury yields fell by 34 basis points to 3.92% while the 10-year bond yield fell by 13 basis points to 3.90%. The 2 and 10-year German government bonds also rallied by 14 and 1 basis point, respectively. August begun with a large risk-off move as markets responded to a weak US labor market report and an uptick in the unemployment rate. These moves were exacerbated in Japan as the BoJ had also raised its policy rate to 0.25%. Risk markets recovered in the following days. Jerome Powell held a dovish speech at the Jackson Hole symposium in which he confirmed the need to reduce policy rates and limit any further cooling in the US labor market. In the Eurozone, inflation data was largely in line with expectations and data from the ECB on wage negotiations showed a slower pace of wage growth over the second quarter. Italian government bond spreads to Germany slightly widened to 140 basis points.

Based on transaction prices, the fund's return was 0.97%. The fund posted a positive return in August as global government bond yields rallied significantly. The fund's steepener positions in the United States, Canada, Sweden and New Zealand added to performance, while the contribution from duration was also positive. Overall, the fund outperformed the reference index in August.

Economic growth remains downbeat in the Eurozone and the labor market continues to cool in the US. Both lead to a reduction in inflationary pressures going forward and it is becoming evident that high policy rates are not required any more. Most central banks around the world have already started to reduce the restrictiveness of their policy stance and the Fed is expected to follow suit at the September FOMC meeting. As such, the discussion is shifting from when rates should be cut towards how much they should be cut. Yield curves have steepened significantly over the past months, and we expect them to continue to steepen throughout the easing cycle. We have shifted some of our steepening exposure from the 5-year to the 2-year maturity government bonds as they tend to perform best in an easing cycle. We remain cautious on France due to its political instability, upcoming government budget negotiations and large issuance requirements.