RobecoSAM Climate Global Credits IH GBP

The Solactive Paris Aligned Global Corporate Index returned -0.74% (hedged to EUR). Credit spread and interest rate moves were mixed. The 10-year US interest rate fell from 1.74% to 1.63%, and the German 10-year yield widened by 9 basis points to -0.20%. The credit spread on the index was tighter at 0.85%.This year, the April earnings season was an interesting one. Demand for spread products was strong and many sectors are near YTD tights. Many of the first-quarter earnings reports published so far were better than expected. On a macro level, sentiment indicators like the purchasing managers' index show expectations of strong growth. This is also reflected in rising commodity prices. Central banks remain accommodative for now and are keen to run the economy hot. The ECB will step up PEPP asset purchases in the second quarter of this year. In the US, Biden has announced another stimulus package of USD 1.8 trillion.

All currency risks are hedged.

The fund does not distribute a dividend.

Climate change considerations are fully integrated in the research process, from an impact and risk perspective. The greenhouse gas emission intensity of issuers is a starting point for determining the impact on climate change, and in our research process we add a forward looking element by assessing the decarbonization potential, strategy and targets of companies. This is to ensure the strategy follows the desired decarbonization trajectory. This may include issuers whose emissions are currently high and that are making an effort to reduce these. Our approach is to invest in companies that allocate capital towards sustainable economic activities. 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, including risks stemming from climate change. 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. ESG analysis is fully integrated in the bottom-up security analysis.

RobecoSAM Climate Global Credits is an actively managed fund that invests mainly in nongovernment bonds all around the world. The selection of these bonds is based on fundamental analysis. The fund's objective is to provide long term capital growth.The fund has sustainable investment as its objective within the meaning of Article 9 of the European Sustainable Finance Disclosure Regulation. The fund to keep the maximum global temperature rise well-below 2◦C by reducing the carbon footprint intensity of the portfolio. The fund integrates ESG (i.e. Environmental, Social and corporate Governance) in the investment process, applies an exclusion list basis controversial behavior, products (including controversial weapons, tobacco, palm oil and fossil fuel) while avoiding investment in thermal coal, weapons, military contracting and companies that severely violate labor conditions, next to proxy voting and engagement . The fund invests mainly in nongovernment bonds (which may include contingent convertible bonds (also “coco” bonds) and similar nongovernment fixed income securities and asset backed securities from all around the world. The carbon footprint reduction objective will be aligned with the Solactive Paris Aligned Global Corporate Index.Benchmark: Solactive Paris Aligned Global Corporate Index. The fund is managed against a benchmark that is consistent with the sustainable investment objectives pursued by the fund. It aims to align with the Paris Agreement requirements on greenhouse gas emission reduction. For corporate bonds the Benchmark aims to represent the performance of an investment strategy that is aligned with the technical standards for EU Paris Aligned Benchmarks in areas such as exclusions and carbon reduction objectives. The Benchmark differs from a broad market index in that the latter does not take into account in its methodology any criteria for alignment with the Paris Agreement on greenhouse gas emission reduction and related exclusions.

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.