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Robeco Euro Government Bonds 2EH EUR

Index: Bloomberg Barclays Euro-Aggregate: Treasury (EUR)
ISIN: LU1241712378
  • Outspoken active and adaptive approach
  • Country allocation main performance driver
  • Active duration and yield curve positioning
Assets class
Current price ()
Performance YTD ()
Currency EUR
Total size of fund ()
Dividend payingYes

About this fund

Robeco Euro Government Bonds invests only in euro-denominated government bonds. The selection of these bonds is based on fundamental analysis. The fund invests in euro denominated bonds issued by the EMU-member countries. It employs an investment process combining top-down and bottom-up elements. Fundamental analysis is performed on each of the three performance drivers: country allocation, duration (interest-rate sensitivity) management and yield curve positioning. Country ESG scores are part of our bottom-up analysis. This share class hedges the duration of the portfolio to approximately two.

Price development

No performance data available

Price development

Robeco Euro Government Bonds 2EH EUR

Performance

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The value of the investments may fluctuate. Past performance is no guarantee of future results.
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
The value of the investments may fluctuate. Past performance is no guarantee of future results.
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

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Based on transaction prices, the fund's return was -0.42%. The fund posted a slightly negative return in October. Bond yields initially rose sharply but quickly reversed their trend as sentiment around Italy worsened and country spreads widened. Country positions subtracted from fund performance as the overweight in Germany and the large underweight in France only partially mitigated the spread widening seen in Belgium and Italy. Especially the France-Germany spread remained remarkably resilient. Whilst we reduced the underweight duration position over the month, declining bond yields still had a somewhat negative impact on fund's performance.

Statistics

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Dividend paying history

Date Amount
Download dividend history

Market development

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Returns were mixed in October for government bonds. US Treasuries lagged, with a return of -0.8%, while Germany was leading with +0.6%. The main reason for the difference in return was renewed unrest in Italy, which drove euro area investors into the safe haven of German Bunds. Italian spreads widened as the government posted a 2019 budget with a ‘confrontational’ deficit level of 2.4%. This led to a rift with the European Commission, which is still unresolved. The spread widening was dampened after Moody’s and S&P did not surprise on the negative side in their judgement on Italy’s credit outlook.

Fund allocation

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Fund Classification

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ESG integration
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Sustainability Themed Fund

Currency policy

The fund is not exposed to currency risks, as the fund invests in Euro-denominated bonds.

Dividend policy

Robeco Euro Government Bonds makes use of government bond futures. These derivatives are regarded very liquid.

ESG Integration policy

For Robeco Euro Government Bonds, ESG information of countries is integrated in the investment policy. For a large group of countries an ESG profile is conducted. These profiles are the basis for the 'Country Sustainability Ranking' where we rank countries in terms of ESG performance. The ranking is updated twice a year. Countries are discussed individually in the team, to clearly assess where opportunities and risks are expected. This information is taken into consideration in the investment decisions, in combination with traditional analyses of fiscal and monetary policy. ESG information is especially valuable for decisions regarding country allocation.

Investment policy

The Robeco Euro Government Bonds fund invests in euro denominated bonds issued by the EMU countries. Investing in euro government bonds calls for active management in order to cope with country risks and interest rate risks. The fund performance is driven by multiple drivers, of which country allocation is currently the most dominant. The team is actively allocating across core and peripheral European exposure, and as such investors can benefit from spread movements whilst keeping investment risks under control. The fund aims to outperform its index Barclays Euro-Aggregate: Treasury. The aim of the country allocation decisions is to confront price differences between Eurozone countries with divergences in economic and political developments. Country views can capture either broader trends (for example changes in European policy) or country specific developments. Both are assessed in a structured way, combining top-down (macro environment & policy, valuation, sentiment & positioning) and bottom-up inputs (a country's debt sustainability, macro-economic cycle, ESG profile). Next to country allocation, active duration and yield curve positioning are the other drivers of alpha. Risk budgeting can be adaptive through time in order to capture the most compelling investment opportunities.

Risk policy

Risk management is fully embedded in the investment process so as to ensure that the fund's positions remain within set limits at all times.

Expectation of fund manager

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Since the start of Q4, combined net bond purchases by the Fed, ECB and BoJ have turned from positive to negative. In our opinion this dynamic will gradually make itself felt in bond markets, via increased upward pressure on long-term yields. Short-term yields are expected to move up as well, but the extent of the rise is limited by what is priced in already. The confrontational stance of the Italian populist government will likely continue, but we think just a little bit of giving in on both sides might already be enough to relieve markets.

Olaf Penninga, Michiel de Bruin
Olaf Penninga, Michiel de Bruin

Olaf Penninga, Michiel de Bruin

Mr. Olaf Penninga is a Senior Portfolio Manager with Robeco's Rates team. Previous affiliations include a position as a Senior Quantitative Researcher with Robeco. Prior to rejoining Robeco in 2002, Olaf was employed by Interpolis as Investment Econometrician for one year. Olaf started his career in the Investment Industry in 1998. He holds a Master's degree in Mathematics (cum laude) from Leiden University. Michiel de Bruin, Co-head of the Fixed Income Global Macro team is co-manager Euro Government Bonds. Prior to joining Robeco, Michiel de Bruin worked for BMO Global Asset Management in London, where his last position was that of Head of Global Rates and Money Markets, having held various other positions before that, including Head of Euro Government Bonds. Before he joined BMO, he was, among others, Co-Head of Fixed income Sales and Trading at NIB Financial Markets in Amsterdam. Michiel started his career in the industry in 1986. He holds a Bachelor's in Applied Sciences from the University of Applied Sciences in Amsterdam.

Team

Robeco Euro Government Bonds is managed within Robeco’s Rates team, which consists of four portfolio managers. The team is focused on government bond strategies including quantitative duration strategies. The investment professionals in the rates team combine portfolio management and research in one function. Furthermore, the team is supported by four dedicated quantitative researchers and four fixed income traders. On average, the members of the rates team have an experience in the asset management industry of sixteen years, of which ten years with Robeco.

Details

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Management company
Fund capital
Outstanding shares
ISINLU1241712378
BloombergROEG2EH LX
Valoren28418161
WKN
Availability
1st quotation date1435190400000
Close financial year31-12
Legal status
Tracking error limit (%)
Morningstar
Reference index

Cost of this fund

Ongoing charges

This fund deducts ongoing charges of
These charges comprise
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Transaction costs

The expected transaction costs are

Performance fee

This fund may also deduct a performance fee of

Extra fees

max entry fee
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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.

Disclaimer

The information contained in the website is solely intended for professional investors. Some funds shown on this website fall outside the scope of the Dutch Act on the Financial Supervision (Wet op het financieel toezicht) and therefore do not (need to) have a license from the Authority for the Financial Markets (AFM).

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