Robeco Financial Institutions Bonds IH USD
- Diversified exposure to subordinated financial bonds
- Disciplined and repeatable investment process
- No active duration, nor FX exposure
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 | |
|---|---|---|
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 -0.22%. The portfolio posted a return that was negative in December. Higher underlying government bond yields were the driver of the negative return, while tighter credit spreads contributed positively to the return. The average index spread ended the month at 283 basis points, which is 22 basis points tighter than at the end of November. The index excess return of subordinated bonds over underlying government bonds was therefore positive, at 0.9%. The performance of the portfolio was better than that of the index. The portfolio had a beta overweight position during the month (circa 1.15). The contribution of this overweight was positive. The largest part of the outperformance can be attributed to issuer selection. The underweight position in real estate names contributed positively to the relative performance, while the overweight in bank CoCos detracted. Individual names that contributed the most on a risk-adjusted basis, were Aroundtown and Grand City Properties (both underweight positions), Ageas, Aegon and Mapfre. The portfolio lost in relative terms through the underweights in Generali and Phoenix.
Statistics
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Market development
{{'fund.detail.general.perDate' | labelize:[ fundDate(fund.fundInvestmentExplanations.date,'llll') ]}}Credit spreads continued to tighten in December, though the pace of tightening was much lower than in November. European swap spreads declined a bit. This decline was an important element in the overall decline in credit spreads. Underlying government bond yields moved up quite a bit in December. The ECB press conference on 15 December was an important driver. As expected, the ECB, the Federal Reserve and the Bank of England all raised interest rates in their December meeting. The ECB surprised though with a relatively hawkish press conference, in which the start of quantitative tightening per March 2023 was announced. The Bank of Japan surprised the market with an increase of the target yield for 10-year Japanese government bonds. Higher government bonds in most countries led to lower equity markets, but credit spreads behaved well in December. A sector that performed very poorly while longer-term yields rose was the European property sector. There was no activity in the new issue market and trading in the portfolio was limited too. We lowered the exposure to (senior) bonds of Credit Suisse, as the restructuring of the bank will take longer than anticipated.
Fund allocation
{{'fund.detail.general.perDate' | labelize:[ fundDate(fund.fundAllocations.date,'llll') ]}}| Name | Sector | Weight |
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Currency policy
All currency risks are hedged.
Derivative policy
Robeco Financial Institutions Bonds fund make use of derivatives for hedging purposes as well as for investment purposes. These derivatives are very liquid.
Dividend policy
This share class of the fund does not distribute dividend.
ESG Integration policy
The fund incorporates sustainability in the investment process via exclusions, ESG integration, a minimum allocation to ESG-labeled bonds, and engagement. 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. Financially material 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. Furthermore, the fund invests at least 5% in green, social, sustainable, and/or sustainability-linked bonds. Lastly, where issuers are flagged for breaching international standards in the ongoing monitoring, the issuer will become subject to engagement.
Investment policy
Robeco Financial Institutions Bonds is an actively managed fund that mainly invests in subordinated euro-denominated bonds issued by financial institutions. The selection of these bonds is based on fundamental analysis. The fund's objective is to provide long-term capital growth. The fund promotes E&S (i.e. Environmental and Social) characteristics within the meaning of Article 8 of the European Sustainable Finance Disclosure Regulation, integrates sustainability risks in the investment process and applies Robeco’s Good Governance policy. The fund applies sustainability indicators, including but not limited to, normative, activity-based and region-based exclusions, and engagement. The fund offers a diversified exposure to subordinated bonds issued by banks and insurance companies and the focus of the fund is, in general, towards higher rated issuers (investment grade). 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, while still controlling relative risk through the application of limits (on currencies and issuers) to the extent of the 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 hiking cycle often ends in a recession with rates typically peaking before credit spreads do. Rates have started to come down and may have peaked in some markets, while inflation is now easing. Our base case is that the US as well as Europe will experience a recession in 2023. The US is likely to experience a classic boom-bust cycle, whereas the European recession will be driven largely by an energy supply shock. European swap spreads are still at elevated levels, with 5-year spreads at 65 bps. With increased issuance of sovereign paper and the prospect of quantitative tightening (QT) next year, we expect a further normalization of swap spreads towards long-term average levels of 40 bps. This is helpful for euro investment grade since swap spreads are a large component of the total spread versus governments. Within euro investment grade, financials screen relatively cheap. In past cycles, financials were often seen as high beta since they are a leveraged bet on the economy. This time around, we see banks as less vulnerable since capital buffers have greatly improved and banks are benefiting from an interest rate environment that has finally normalized.
Jan Willem de Moor
Jan Willem de Moor is Portfolio Manager Investment Grade in the Credit team. Prior to joining Robeco in 2005, he worked at the Dutch Medical professionals’ pension fund as an Equity Portfolio Manager and at SNS Asset Management as an Equity Portfolio Manager. Jan Willem has been active in the industry since 1994. He holds a Master's in Economics from Tilburg University.
Team
The Robeco Financial Institutions Bonds fund is managed within Robeco’s credit team, which consists of nine portfolio managers and twenty-three credit analysts (of which four financials 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 dedicated quantitative researchers and 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 | LU1117477098 |
| Bloomberg | RFIBIHU LX |
| Valoren | 25594216 |
| WKN | A2AQQV |
| Availability | |
| 1st quotation date | 1412726400000 |
| Close financial year | 31-12 |
| Legal status | |
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Cost of this fund
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Transaction costs |
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Extra fees
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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 0.01% 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
Investors who are not subject to (exempt from) Dutch corporate-income tax (e.g. pension funds) are not taxed on the achieved result. Investors who are subject to Dutch corporate-income tax can be taxed for the result achieved on their investment in the fund. Dutch bodies that are subject to corporate-income tax are obligated to declare interest and dividend income, as well as capital gains in their tax return. Investors residing outside the Netherlands are subject to their respective national tax regime applying to foreign investment funds. We advise individual 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.
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Fund documents
The Robeco Capital Growth Funds have not been registered under the United States Investment Company Act of 1940, as amended, nor the United States Securities Act of 1933, as amended. None of the shares may be offered or sold, directly or indirectly in the United States or to any US Person. A US Person is defined as (a) any individual who is a citizen or resident of the United States for federal income tax purposes; (b) a corporation, partnership or other entity created or organized under the laws of or existing in the United States; (c) an estate or trust the income of which is subject to United States federal income tax regardless of whether such income is effectively connected with a United States trade or business.