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AXA IM FIIS Europe Short Duration High Yield
Last NAV 155.9100 USD as of 24/02/20
The Sub-Fund seeks to achieve high attractive income and secondarily capital growth by investing primarily in high yield debt securities denominated in a European currency over a medium-term period. The Unit Class aims at hedging the foreign exchange risk resulting from the divergence between the reference currency of the Sub-Fund and the currency of this Unit Class by using derivatives instruments whilst retaining the exposure to Investment Policy described above.
Synthetic Risk & Reward Information scale
The risk category is calculated using historical performance data and may not be a reliable indicator of the Sub-Fund's future risk profile. The risk category shown is not guaranteed and may shift over time. The lowest category does not mean risk free.
Why is this Fund in this category?
Fund manager comment : 31/01/20
Factors affecting performance The modest optimism on the cyclical growth outlook that prevailed at the beginning of January has given way to worry about a health pandemic in the wake of the emergence of the coronavirus in China. January saw, in the end, a shift toward a risk-off environment with global high yield market credit spreads ending the period 37bps wider. The EM region benefitted from its long duration stance and sustained technicals while the US and European regions were more impacted by the change in sentiment. As the high yield primary market activity reopened in both US and European regions, we saw a solid $38.5bn of USD-denominated debt added and €13.2bn of new supply in Europe. Sterling HY outperformed the Euro HY sub universe, being less impacted somehow by the risk-off sentiment. Looking at rating higher beta corporate bonds outperformed the longer duration BB ones while the top-performing sectors in the month were financials and real estate, and the least performing ones were services and retail. In January, the ICE BofAML European Currency High Yield Index recorded +0.3% total return (EUR hedged), with a -0.2% excess return versus governments. Main changes to the portfolio Good activity in the fund through the month in line with current market environment and client flows. On the secondary markets we invested the recent cash build up from the natural strategy’s liquidity generation, trading across sectors and rating buckets. As for primary market we have been participating in deals such as Techem (services), United Group (media), Digi Communications (media) and Altice (telecommunications). Current market influences and outlook Taking a medium-term view investors should keep in mind the fundamental outlook. Central banks are on hold and, if there were to be any change to that call it would be that rates will be cut in the US and UK. At the same time, central bank balance sheets are expanding, and this is generating strong money supply growth. Beyond the virus, external threats to growth have subsided while corporate earnings appear to have stabilised, with Q4 earnings showing some modest beating of expectations. While there are concerns about valuations, 2020 should be a year that delivers modest returns across financial markets. The risk is that, for credit, spreads have become quite tight and any risk of the consensus global outlook not materialising could result in some widening, as already evidenced in parts of the credit market in January. If the spread of the coronavirus is brought under control in the relatively near-term, then macro-economic developments are likely to re-establish a cautiously optimistic risk-on market environment.
|Performance indicator||Start date||End date|
|Performance table||Net performance||Performance indicator||Start date||End date|
|Risk table||Fund volatility||Benchmark volatility||Tracking error||Information ratio||Sharpe ratio||Beta||Alpha|
|First NAV date||08/08/11|
|Asset class||HIGH YIELD AND US ACTIVE FIXED|
|Legal authority||Commission de Surveillance du Secteur Financier|
|Fund Manager||James GLEDHILL|
|Investment team||MT European & Global High Yield|
Subscription and redemption
The subscription, conversion or redemption orders must be received by the Registrar and Transfer Agent on any Valuation Day no later than 10 a.m. Luxembourg time. Orders will be processed at the Net Asset Value applicable to such Valuation Day. The investor's attention is drawn to the existence of potential additional processing time due to the possible involvement of intermediaries such as Financial Advisers or distributors. The Net Asset Value of this Sub-Fund is calculated on a daily basis. Minimum initial investment: 30,000,000 in the relevant reference currency of the relevant Unit class.