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
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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
July was a month of two halves. Initially, weaker US labor market and inflation data led to an optimistic sentiment, boosting hopes for rate cuts starting in September. In the second half, the expected summer lull set in, accompanied by weak sentiment due to the US earnings season and falling commodity prices. Over the course of the month, 2-year and 10-year US yields declined by 50 and 37 basis points (Bps), respectively. Spreads on EM sovereign and corporate bonds widened by 10 and 13 Bps, respectively. The Berenberg EM Bonds Fonds delivered strong absolute and relative performance, primarily thanks to its duration strategy. The fund management increased both the duration and sensitivity to interest rates before, which even lead to an improvement of the average rating of fund to BB+.
Portfolio Management
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