Robeco QI Dynamic High Yield IH USD

The global high yield bond spread decreased by 16 bps, while the European iTraxx CrossOver index decreased by 16 bps and the US CDX High Yield index decreased by 14 bps. The global CDS index return was 0.97% and the underlying government bonds made a small positive contribution of 0.05%. The combined return of investing in CDS indices and government bonds was 1.02% this month, somewhat higher than the return of 0.94% of the high yield cash bond index. Positive momentum in spreads continued in June. Many sectors trade at or near their all-time tights. In the US, jobless claims dipped below 400,000, close to numbers last seen before the pandemic. The US President is thinking about lowering the corporate tax rate as well as creating a global digital tax system. Fed chairman Powell said it is appropriate at this stage to start the ‘talking-about-talking-about’ tapering, as inflation concerns increase. Several commodities normalized as supply bottlenecks eased, for instance in wood, but oil kept trading higher due to supply demand imbalances. In Europe, the ECB increased PEPP purchases to EUR 80 bln as core inflation is still below their medium-run target.

Currency risks are hedged.

All income earned will be accumulated and not be distributed as dividend. Therefore the entire return is reflected in the share price development.

For Robeco QI Dynamic High Yield the investment universe and the type of investments are such that it is not feasible to implement the ESG factors into the investment processes.

Robeco QI Dynamic High Yield offers well-diversified exposure to US and European high yield corporates by investing in highly liquid CDS indices. These indices are much more liquid than direct investments in high yield bonds. Because of their high liquidity, investors can use these CDS indices to efficiently get high yield exposure with much lower transaction costs than through high yield bonds. The performance of Robeco QI Dynamic High Yield is driven by a unique quantitative market-timing model. This proprietary model has a track record of over 10 years. The model is based on academic research and uses a variety of factors, amongst others from credit and equity markets, to forecast credit returns. Based on this forecast, the exposure of the fund to the high yield corporate bond market will be decreased or increased. As a result, the beta of the portfolio varies between 0.5 and 1.5, to reduce risk in declining markets and to benefit more in rising markets. Robeco QI Dynamic High Yield Fund aims to offer a better return than the Bloomberg Barclays Global High Yield Corporate index. The index is used to express the benefits of the strategy as an alternative to passive or direct investments in high yield bonds. Weekly positioning updates are available upon request.

The investment strategy of the fund aims to outperform its 100% exposure to high yield corporates by taking active beta positions based on Robeco's quantitative market timing model. These active positions are set to always meet the predefined guidelines. As the investment exposure of the fund is obtained to a material degree through derivatives, it is important to manage counterparty risk. Therefore the credit quality of the counterparties is monitored and collateral is exchanged on a daily basis to reflect market movements in the value of the instruments. The predefined guidelines also restrict the leverage exposure of derivatives on a fund level and the currency exposure as described in the prospectus.