Robeco Euro Government Bonds ZH EUR

Government bonds posted negative returns in August, with Australia being the only main market that managed to end the month in the green. German Bunds continued their rally into the first half of August, but gave back these gains and more in the final days. The move upwards in German yields was triggered by comments from ECB officials (e.g. Knot, Holzmann) on the ECB's PEPP purchases and by a jump in inflation. Other European bond markets followed the rise in German interest rates. US Treasury yields were pushed upwards early in the month, as a result of a hawkish speech by Fed Vice Chair Richard Clarida and by a strong payrolls growth number for July. Fed Chair Powell's speech at the Jackson Hole conference was regarded as dovish. He acknowledged the growing willingness to initiate tapering in 2021, but also underlined the transitory nature of the current high inflation.

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

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

The fund does not distribute dividend. The income earned by the fund is reflected in its share price. This means that the fund's total performance is reflected in its share price performance.

In our government bond portfolios, the active country allocation is based on a combination of top-down and bottom-up analysis. In the bottom-up analysis, besides debt sustainability and economic cycle, ESG criteria are an integral part of our analysis. For our top-down analysis, our in-house developed RobecoSAM Country Sustainability Ranking (CSR) is used in our country allocation decisions. The CSR acts as an early-warning system which helps us to identify problems as well as opportunities in countries well before they are reflected in spreads, or are picked up by the rating agencies.

Robeco Euro Government Bonds is an actively managed fund that invests only in euro-denominated government bonds. 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. 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 analysisThe 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) 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 management is fully embedded in the investment process so as to ensure that the fund's positions remain within set limits at all times.