Investment Strategy
The Berenberg EM Bonds fund uses an active investment process to invest in attractive government and quasi-sovereign bonds from emerging markets that offer above-average return potential compared to traditional EUR fixed income investments. Using a combination of systematic and discretionary components in the investment process, the fund manager selects bonds from fundamentally convincing emerging markets or government-related companies for the portfolio. The investment strategy is underpinned by ongoing country risk management and active interest rate duration management. The foreign currency risk is generally hedged.
- Fundamental investment approach in government and quasi-sovereign bonds from Emerging Markets with active duration management
- Active positioning against a market benchmark
- Average duration is between 0 and 10 years
- Investment segments are primarily (quasi) government bonds in hard currencies
Learn more about our Berenberg Fixed Income investment philosophy
Further details on the opportunities and risks of this fund can be found in the sales prospectus.
Indexed performance
Performance in 12-month periods
Currencies
Sectors
Countries
Asset classes
Top Holdings
Monthly market comment
In May, the markets experienced a rollercoaster of sentiments. After a surprisingly weak labor market report, risk assets along with US Treasuries recovered until a surprisingly strong PMI survey led to a sell-off. Emerging market bonds breathed in sync with the market during this phase, until election surprises in South Africa and Mexico caused turbulence towards the end of the month. The spreads of emerging market sovereign bonds varied, with investment-grade bonds decreasing by 3 basis points and high-yield bonds increasing by 21 basis points. On a monthly basis, the Berenberg EM Bonds Fund performed positively. The portfolio management moderately increased the fonds duration and adjusted the weightings in the high-yield sector. After solid performance, Kenya was exchanged in favor of Turkey.