Kempen Lux Euro Credit Fund - Class ID

Profile

Kempen International Funds SICAV - Kempen (Lux) Euro Credit Fund (the Fund) invests primarily in credits that have an investment grade rating (of minimal BBB-) and are denominated in Euros. The Fund may invest a small part in credits that are not included in the benchmark. The benchmark, the Markit iBoxx Euro Corporates Index, only includes bonds with an investment grade rating.

The Fund aims to earn a higher total long term return than the benchmark by implementing an active investment policy. In order to achieve this, a diversified portfolio is constructed and investment risks are continuously monitored. Investments are selected on the basis of extensive analysis of the terms and conditions of the bond issues.

In the interest of the shareholders it has been decided to soft close the Fund as per 5 January 2016. The Fund will continue to accept daily inflow below EUR 5 million from only existing investors. For investments greater than EUR 5 million please contact the Fund’s relationship manager. Redemptions will still be possible. More information about the soft close can be found in the Notice to shareholders in the tab Documents. The objective of de duration hegded share class JD is to hedge the interest rate exposure of the portfolio and by that reduce the impact of changes in the German Sovereign Curve on the return of the share class.

Management team

Alain van der Heijden, Rik den Hartog, Heinie Hakker, Harold van Acht, Sipke Moes, Luuk Cummins, Pim van Mourik Broekman, Quirijn Landman

Performance per 2017-09-30 (rebased)

No chart data available

Performance per 2017-09-30

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  Fund Benchmark
1 month 0.1 % -0.2 %
3 months 0.2 % 1.1 %
This year 1.3 % 1.7 %
2014 2.4 % 8.2 %
2015 -1.0 % -0.7 %
2016 1.3 % 4.7 %
3 years (on annual basis) i 0.6 % 2.4 %
5 years (on annual basis) i 2.0 % 3.8 %
Since inception (on annual basis) i 2.5 % 4.2 %
From 30 June 2012 until 30 April 2014 the performance graph and table show the performance of Kempen (Lux) Euro Credit Fund class ID. From 1 May 2014 until 22 October 2015 the performance shown is that of Kempen (Lux) Euro Credit Fund class JD. As of 23 October 2015 the performance of Kempen (Lux) Euro Credit Fund class ID is shown. Performance is shown after deduction of ongoing charges and including the reinvestment of dividend that has been paid out. The value of your investments may fluctuate. Past performance provides no guarantee for the future.
More information can be found on the documents page of this fund

Key figures

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Total fund size
EUR 1,866.38 M 2017-09-30
Number of shares
63,578 2017-09-30
Net Asset Value i
EUR 1,030.55 2017-10-19

Fund characteristics per 2017-09-30

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  Fund Benchmark
Number of holdings 267 2088
Duration i 0.0 5.2
Weighted rating A- BBB+
Kempen (Lux) Euro Credit Fund (the “Sub-Fund”) is a sub-fund of Kempen International Funds SICAV (the “Fund”), domiciled in Luxembourg. This Fund is authorised in Luxembourg and is regulated by the Commission de Surveillance du Secteur Financier. Kempen Capital Management N.V. (KCM) is the management company of the Fund. KCM is authorised as management company and regulated by The Netherlands Authority for the Financial Markets.

Paying agent and representative in Switzerland is RBC Investor Services Bank S.A., Esch-sur-Alzette, Zweigniederlassung Zürich, Badenerstrasse 567, P.O. Box 1292, 8048 Zürich. The Sub-Fund is registered with The Netherlands Authority for the Financial Markets under the license of the Fund.

The information in this document provides insufficient information for an investment decision. Please read the Key Investor Document and the prospectus. These documents as well as annual report, semi-annual report and the articles of incorporation of the Fund are available free of charge at the registered office of the Fund located at 6H, route de Trèves, L-2633 Senningerberg, Luxembourg, at the offices of the representative in Switzerland and on the website of KCM (www.kempen.com/investmentfunds).

The Sub-Fund is registered for offering in a limited number of countries. The countries where the Sub-Fund is registered can be found on the website. The value of your investment may fluctuate. Past performance provides no guarantee for the future. The performance shown does not take account of any commissions and costs charged when subscribing to and redeeming units.

Market developments per 2017-09-30

In September, the spread of the iBoxx Euro Corporate Index tightened by 4 basis points to 107 basis points above the government bonds curve. The index earned an absolute return of -0.22%. German 10-year government bond yields finished September at 0.46%, 10 basis points higher than at the end of August.

In September, the ECB failed to provide clarity on how it intends to scale back its bond-buying programmes next year. However, it is becoming clear that the Corporate Sector Purchase Programme, or CSPP, has not been reduced proportionally in line with the initial tapering of the QE programme. Earlier this year, this programme was reduced from EUR80 billion to EUR60 billion per month. The ECB purchased approximately EUR8 billion in credits in September. This means that the ECB now holds about 10% of all eligible corporate bonds.

In addition to the ECB’s steady purchase of credits, strong inflows into the investment grade credits asset class was another important cause of spreads tightening in September. This positive technical climate ultimately outweighed the numerous concerns currently preoccupying investors. These included the geopolitical crisis in Korea, potential further interest rate hikes by the Fed and plans to reduce the size of its balance sheet, growing constitutional tensions between the Spanish and Catalonian governments and the economic losses caused by a series of hurricanes in the US and Caribbean islands.

One sector in which spreads did respond to the losses caused by the hurricanes was the reinsurance sector. Having already been confronted with the prospect of higher claims in the wake of Hurricane Harvey at the end of August, the sector was hit by two further hurricanes (Irma and Maria) and a severe earthquake in Mexico. So far, it seems likely that these events will chiefly have an impact on the third-quarter earnings of reinsurers and to a much lesser extent on their solvency levels. Nevertheless, concerns about the sector’s capital position could arise if additional disasters occur in the near future and if the reinsurance sector has not yet been able to raise premiums significantly.

Two relatively large acquisitions were announced in September. United Technologies, a US industrial conglomerate, wants to take over fellow aerospace industry company Rockwell Collins for about USD30 billion. Given that United Technologies wishes to finance the acquisition primarily with debt, S&P, Moody’s and Fitch have announced that they will review their current ratings, noting that it is highly likely that the ratings will be downgraded. The agencies responded in a similar fashion when Fortum, a Finnish utility, surprised the market by announcing its bid to acquire Germany’s Uniper for EUR9.8 billion. Both acquisitions are in line with the recent trend of mainly non-financial companies being prepared to allow their creditworthiness to deteriorate in order to achieve in-organic growth.

In September, the supply of new bonds was EUR51.7 billion, more than twice the amount of the previous month and about 8% up on September 2016. Non-financial sector institutions issued EUR24.2 billion in new bonds last month, while financial sector institutions issued EUR27.5 billion in new bonds. During the first nine months of this year, the supply of new bonds amounted to EUR418.2 billion, a slight decrease of 4% compared to last year.

Portfolio developments per 2017-09-30

Across the month, the portfolio’s sensitivity to market trends varied between 103% and 107%. The portfolio, therefore, held a relatively slight overweight positioning in terms of market risk.

Our positioning in the telecom, oil & gas and banking sectors performed relatively well in September. In contrast, our positioning in the food and pharmaceutical sectors, as well as in non-banking financial service providers, contributed negatively. Our liquidity position (in the shape of cash and government bonds) contributed negatively.

At individual company level, the overweights in Telecom Italia, AT&T, Engie, ENI, Total and Volkswagen contributed positively. In contrast, the underweights in Daimler and Bayer and overweight in Hannover Re made a negative contribution.

In September, the Fund participated in new bond issues by, among others, Transurban, Belfius, Engie, Brenntag, Goodman Australia, Volksbank, Commonwealth Bank of Australia (subordinated), Deere, Total and CPI Property Group.

Outlook
In spite of the fact that we hold a more positive view of the technical climate than we did a month ago, we continue to be reasonably cautious about the European credit market. The lack of dispersion in the spread premiums that companies with wide-ranging levels of creditworthiness are having to pay remains a serious cause for concern. Moreover, from a historical perspective spreads are still very tight. We also see risks in the current conflict between the US and North Korea and in inflation rising more rapidly than expected due to the upturn in the global economy. For this reason, in spite of the robust economic climate in Europe and the persisting support for the credit market deriving from the ECB’s CSPP, we intend to maintain our conservative positioning in the short term.
Kempen (Lux) Euro Credit Fund (the “Sub-Fund”) is a sub-fund of Kempen International Funds SICAV (the “Fund”), domiciled in Luxembourg. This Fund is authorised in Luxembourg and is regulated by the Commission de Surveillance du Secteur Financier. Kempen Capital Management N.V. (KCM) is the management company of the Fund. KCM is authorised as management company and regulated by The Netherlands Authority for the Financial Markets.

Paying agent and representative in Switzerland is RBC Investor Services Bank S.A., Esch-sur-Alzette, Zweigniederlassung Zürich, Badenerstrasse 567, P.O. Box 1292, 8048 Zürich. The Sub-Fund is registered with The Netherlands Authority for the Financial Markets under the license of the Fund.

The information in this document provides insufficient information for an investment decision. Please read the Key Investor Document and the prospectus. These documents as well as annual report, semi-annual report and the articles of incorporation of the Fund are available free of charge at the registered office of the Fund located at 6H, route de Trèves, L-2633 Senningerberg, Luxembourg, at the offices of the representative in Switzerland and on the website of KCM (www.kempen.com/investmentfunds).

The Sub-Fund is registered for offering in a limited number of countries. The countries where the Sub-Fund is registered can be found on the website. The value of your investment may fluctuate. Past performance provides no guarantee for the future. The performance shown does not take account of any commissions and costs charged when subscribing to and redeeming units.

Performance per 2017-09-30 (rebased)

No chart data available

Performance per 2017-09-30

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  Fund Benchmark
1 month 0.1 % -0.2 %
3 months 0.2 % 1.1 %
This year 1.3 % 1.7 %
2014 2.4 % 8.2 %
2015 -1.0 % -0.7 %
2016 1.3 % 4.7 %
3 years (on annual basis) i 0.6 % 2.4 %
5 years (on annual basis) i 2.0 % 3.8 %
Since inception (on annual basis) i 2.5 % 4.2 %
From 30 June 2012 until 30 April 2014 the performance graph and table show the performance of Kempen (Lux) Euro Credit Fund class ID. From 1 May 2014 until 22 October 2015 the performance shown is that of Kempen (Lux) Euro Credit Fund class JD. As of 23 October 2015 the performance of Kempen (Lux) Euro Credit Fund class ID is shown. Performance is shown after deduction of ongoing charges and including the reinvestment of dividend that has been paid out. The value of your investments may fluctuate. Past performance provides no guarantee for the future.

Dividends

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Distributing
No
Kempen (Lux) Euro Credit Fund (the “Sub-Fund”) is a sub-fund of Kempen International Funds SICAV (the “Fund”), domiciled in Luxembourg. This Fund is authorised in Luxembourg and is regulated by the Commission de Surveillance du Secteur Financier. Kempen Capital Management N.V. (KCM) is the management company of the Fund. KCM is authorised as management company and regulated by The Netherlands Authority for the Financial Markets.

Paying agent and representative in Switzerland is RBC Investor Services Bank S.A., Esch-sur-Alzette, Zweigniederlassung Zürich, Badenerstrasse 567, P.O. Box 1292, 8048 Zürich. The Sub-Fund is registered with The Netherlands Authority for the Financial Markets under the license of the Fund.

The information in this document provides insufficient information for an investment decision. Please read the Key Investor Document and the prospectus. These documents as well as annual report, semi-annual report and the articles of incorporation of the Fund are available free of charge at the registered office of the Fund located at 6H, route de Trèves, L-2633 Senningerberg, Luxembourg, at the offices of the representative in Switzerland and on the website of KCM (www.kempen.com/investmentfunds).

The Sub-Fund is registered for offering in a limited number of countries. The countries where the Sub-Fund is registered can be found on the website. The value of your investment may fluctuate. Past performance provides no guarantee for the future. The performance shown does not take account of any commissions and costs charged when subscribing to and redeeming units.

Maturity profile (2017-09-30)

Fund
Benchmark
24.3 %
0-3 year
21.8 %
12.1 %
3-5 year
28.0 %
30.4 %
5-7 year
20.6 %
15.2 %
7-10 year
21.3 %
15.5 %
> 10 year
8.4 %
2.5 %
Cash
0.0 %
Totaal
100 %
100 %

Sector allocation (2017-09-30)

31.1 %
Banks
17.1 %
Consumer Goods & Services
8.2 %
Utilities
8.1 %
Telecom & Technology
7.9 %
Financial Services & Real estate
6.6 %
Industry
4.8 %
Insurance
3.5 %
Other
3.4 %
Energy
2.4 %
Health Care
2.3 %
Supranational
2.3 %
Basic Materials
1.2 %
Asset Backed Securities
1.1 %
Sovereign bonds
Totaal
100 %
The cash position is included in ‘Other’.

Rating allocation (2017-09-30)

Fund
Benchmark
6.5 %
AAA
0.6 %
6.3 %
AA
11.0 %
36.8 %
A
39.2 %
40.2 %
BBB
49.3 %
4.0 %
BB
0.0 %
3.7 %
Not Rated
0.0 %
2.5 %
Cash
0.0 %
Totaal
100 %
100 %
The rating allocation of the Fund is based on the Bloomberg Composite method. The rating allocation of the benchmark is based on the rating allocation used by provider Markit iBoxx.

Top 10 holdings (2017-09-30)

1.0 %
1.375% Goldman Sachs 2017-24
0.9 %
1.500% ENIIM 2017-27
0.9 %
1.379% Bank of America 2017-25
0.9 %
1.250% BG Energy Capital 2014-22
0.9 %
1.638% JP Morgan Chase 2017-28
0.8 %
0.850% US Bancorp 2017-24
0.8 %
0.625% Landwirtsch.Rentenbank 2015-30
0.8 %
1.250% KFW 2016-36
0.8 %
4.000% Rabobank 2012-22
0.8 %
0.875% ENGIE 2017-24
Totaal
8.6 %
Kempen (Lux) Euro Credit Fund (the “Sub-Fund”) is a sub-fund of Kempen International Funds SICAV (the “Fund”), domiciled in Luxembourg. This Fund is authorised in Luxembourg and is regulated by the Commission de Surveillance du Secteur Financier. Kempen Capital Management N.V. (KCM) is the management company of the Fund. KCM is authorised as management company and regulated by The Netherlands Authority for the Financial Markets.

Paying agent and representative in Switzerland is RBC Investor Services Bank S.A., Esch-sur-Alzette, Zweigniederlassung Zürich, Badenerstrasse 567, P.O. Box 1292, 8048 Zürich. The Sub-Fund is registered with The Netherlands Authority for the Financial Markets under the license of the Fund.

The information in this document provides insufficient information for an investment decision. Please read the Key Investor Document and the prospectus. These documents as well as annual report, semi-annual report and the articles of incorporation of the Fund are available free of charge at the registered office of the Fund located at 6H, route de Trèves, L-2633 Senningerberg, Luxembourg, at the offices of the representative in Switzerland and on the website of KCM (www.kempen.com/investmentfunds).

The Sub-Fund is registered for offering in a limited number of countries. The countries where the Sub-Fund is registered can be found on the website. The value of your investment may fluctuate. Past performance provides no guarantee for the future. The performance shown does not take account of any commissions and costs charged when subscribing to and redeeming units.

Ongoing charges

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Management fee i
0.32 %
Service fee i
0.10 %
Taxe d'abonnement i
0.01 %
Expected ongoing charges i
0,43 %

Other costs

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Upward swing factor i
0.25 %
Downward swing factor i
0.25 %
More about our swing pricing policy
The swingfactor is applicable if the sum of in and outflow (end trading day) is more than a pre defined percentage ( the so called ‘threshold’) of the fund size. The level of the threshold can vary; investors can request KCM for information about the thresholds that were applied in the past. As of 7 July 2015 the swing factor has been adjusted from 0.20% to 0.25%.
Kempen (Lux) Euro Credit Fund (the “Sub-Fund”) is a sub-fund of Kempen International Funds SICAV (the “Fund”), domiciled in Luxembourg. This Fund is authorised in Luxembourg and is regulated by the Commission de Surveillance du Secteur Financier. Kempen Capital Management N.V. (KCM) is the management company of the Fund. KCM is authorised as management company and regulated by The Netherlands Authority for the Financial Markets.

Paying agent and representative in Switzerland is RBC Investor Services Bank S.A., Esch-sur-Alzette, Zweigniederlassung Zürich, Badenerstrasse 567, P.O. Box 1292, 8048 Zürich. The Sub-Fund is registered with The Netherlands Authority for the Financial Markets under the license of the Fund.

The information in this document provides insufficient information for an investment decision. Please read the Key Investor Document and the prospectus. These documents as well as annual report, semi-annual report and the articles of incorporation of the Fund are available free of charge at the registered office of the Fund located at 6H, route de Trèves, L-2633 Senningerberg, Luxembourg, at the offices of the representative in Switzerland and on the website of KCM (www.kempen.com/investmentfunds).

The Sub-Fund is registered for offering in a limited number of countries. The countries where the Sub-Fund is registered can be found on the website. The value of your investment may fluctuate. Past performance provides no guarantee for the future. The performance shown does not take account of any commissions and costs charged when subscribing to and redeeming units.

Share class details

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Share class
ID i
Investor type
Institutional
Distributing
No
Benchmark i
Markit iBoxx Euro Corporates Index
Duration hedged
Yes
Investment category
Credits
Universum
Credits denominated in euro
Inception date
2015-10-23
Domicile
Luxembourg
May be offered to professional investors only in
Luxembourg, Switzerland, The Netherlands
UCITS status i
Yes
Status
Open-end i
Base currency
EUR
Share class currency
EUR
Management company
Kempen Capital Management N.V.
Custodian
J.P. Morgan Bank Luxembourg S.A.

Tradability

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Minimum subscription
Initial subscription: €50,000, additional subscriptions: €10,000
Listed
no
Pricing frequency
Daily
ISIN i
LU0772264197
Kempen (Lux) Euro Credit Fund (the “Sub-Fund”) is a sub-fund of Kempen International Funds SICAV (the “Fund”), domiciled in Luxembourg. This Fund is authorised in Luxembourg and is regulated by the Commission de Surveillance du Secteur Financier. Kempen Capital Management N.V. (KCM) is the management company of the Fund. KCM is authorised as management company and regulated by The Netherlands Authority for the Financial Markets.

Paying agent and representative in Switzerland is RBC Investor Services Bank S.A., Esch-sur-Alzette, Zweigniederlassung Zürich, Badenerstrasse 567, P.O. Box 1292, 8048 Zürich. The Sub-Fund is registered with The Netherlands Authority for the Financial Markets under the license of the Fund.

The information in this document provides insufficient information for an investment decision. Please read the Key Investor Document and the prospectus. These documents as well as annual report, semi-annual report and the articles of incorporation of the Fund are available free of charge at the registered office of the Fund located at 6H, route de Trèves, L-2633 Senningerberg, Luxembourg, at the offices of the representative in Switzerland and on the website of KCM (www.kempen.com/investmentfunds).

The Sub-Fund is registered for offering in a limited number of countries. The countries where the Sub-Fund is registered can be found on the website. The value of your investment may fluctuate. Past performance provides no guarantee for the future. The performance shown does not take account of any commissions and costs charged when subscribing to and redeeming units.
Kempen (Lux) Euro Credit Fund (the “Sub-Fund”) is a sub-fund of Kempen International Funds SICAV (the “Fund”), domiciled in Luxembourg. This Fund is authorised in Luxembourg and is regulated by the Commission de Surveillance du Secteur Financier. Kempen Capital Management N.V. (KCM) is the management company of the Fund. KCM is authorised as management company and regulated by The Netherlands Authority for the Financial Markets.

Paying agent and representative in Switzerland is RBC Investor Services Bank S.A., Esch-sur-Alzette, Zweigniederlassung Zürich, Badenerstrasse 567, P.O. Box 1292, 8048 Zürich. The Sub-Fund is registered with The Netherlands Authority for the Financial Markets under the license of the Fund.

The information in this document provides insufficient information for an investment decision. Please read the Key Investor Document and the prospectus. These documents as well as annual report, semi-annual report and the articles of incorporation of the Fund are available free of charge at the registered office of the Fund located at 6H, route de Trèves, L-2633 Senningerberg, Luxembourg, at the offices of the representative in Switzerland and on the website of KCM (www.kempen.com/investmentfunds).

The Sub-Fund is registered for offering in a limited number of countries. The countries where the Sub-Fund is registered can be found on the website. The value of your investment may fluctuate. Past performance provides no guarantee for the future. The performance shown does not take account of any commissions and costs charged when subscribing to and redeeming units.

KCM Vision

Kempen Capital Management is an asset manager with a long-term investment approach. We strongly believe in engaged shareholdership that benefits all stakeholders. As a long-term responsible investor, we firmly believe that active ownership and shareholder engagement contribute to positive change across the board.

Our KCM wide approach to responsible investment

To put our vision into action we engage with our investment targets on a wide array of strategic, financial, environmental, social and governance (ESG) topics. Our long-term investment worldview paired with thorough analysis and an experienced and diverse ESG team allow us to use both voting and engagement as means to consistently encourage positive change. Through this process of constructive engagement, we are able to contribute to the development of principles and standards of corporate responsibility within companies.

Fund approach to Responsible Investment

The Kempen credit funds do not invest in companies that are either on the KCM exclusion or avoidance list. The focus in Kempen (Lux) Euro Credit Fund and Kempen (Lux) Euro Credit Fund + lies with the worst performing companies in terms of ESG. Companies that have a MSCI ESG rating ? B (on a scale where AAA is the highest and CCC is the lowest), a fail on the UN Global compact or a red flag on Impact Monitor, are selected for further analysis. Our sector specialist assesses the materiality of the ESG issue and its implications for the credit profile of the company. If an issue is deemed material, our first objective is to engage with the company on the issue. If we can conclude from the engagement that the ESG concerns are not structural and if the company is willing to improve, we make an adjustment in the determination of the relative value of the company's securities. In severe cases where we do not see any prospect of improvement we forego investment in the company.

Kempen (Lux) Euro Credit Fund (the “Sub-Fund”) is a sub-fund of Kempen International Funds SICAV (the “Fund”), domiciled in Luxembourg. This Fund is authorised in Luxembourg and is regulated by the Commission de Surveillance du Secteur Financier. Kempen Capital Management N.V. (KCM) is the management company of the Fund. KCM is authorised as management company and regulated by The Netherlands Authority for the Financial Markets.

Paying agent and representative in Switzerland is RBC Investor Services Bank S.A., Esch-sur-Alzette, Zweigniederlassung Zürich, Badenerstrasse 567, P.O. Box 1292, 8048 Zürich. The Sub-Fund is registered with The Netherlands Authority for the Financial Markets under the license of the Fund.

The information in this document provides insufficient information for an investment decision. Please read the Key Investor Document and the prospectus. These documents as well as annual report, semi-annual report and the articles of incorporation of the Fund are available free of charge at the registered office of the Fund located at 6H, route de Trèves, L-2633 Senningerberg, Luxembourg, at the offices of the representative in Switzerland and on the website of KCM (www.kempen.com/investmentfunds).

The Sub-Fund is registered for offering in a limited number of countries. The countries where the Sub-Fund is registered can be found on the website. The value of your investment may fluctuate. Past performance provides no guarantee for the future. The performance shown does not take account of any commissions and costs charged when subscribing to and redeeming units.