Kempen Lux Euro Credit Fund - Class AN

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.

Management team

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

Performance per 2017-12-31 (rebased)

No chart data available

Performance per 2017-12-31

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  Fund Benchmark
1 month -0.3 % -0.3 %
3 months 0.7 % 0.6 %
This year 2.4 % 2.4 %
2014 9.0 % 8.2 %
2015 -0.0 % -0.7 %
2016 5.1 % 4.7 %
3 years (on annual basis) i 2.5 % 2.1 %
5 years (on annual basis) i 3.8 % 3.3 %
Since inception (on annual basis) i 5.9 % 4.8 %
On 23 July 2013, the rebate free class (AN) of Kempen (Lux) Euro Credit Fund was launched. The results shown of the period 30 January 2012 until 23 July 2013 are those of class A of the same fund. The higher management fee of Class A has had an impact on the performance quoted. On 20 June 2013, Kempen Euro Credit Fund (KECF) was merged with Kempen (Lux) Euro Credit Fund. Up to 30 January 2012 (start of the Fund’s A class) the performance graph and performance table show the performance of KECF. The average annual TER for the period of April 2008 till June 2013 is 0.91%. Performance is shown after deduction of ongoing charges. 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 1,820.22 M 2017-12-31
Number of shares
1,840,564 2017-12-31
Net Asset Value i
EUR 29.71 2018-01-18
Morningstar rating â„¢
Morningstar Analyst rating
Silver

Fund characteristics per 2017-12-31

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  Fund Benchmark
Number of holdings 259 2166
Duration i 5.3 5.2
Yield to maturity 1.0 % 1.0 %
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 2017-12-31

In December, the spread of the iBoxx Euro Corporate Index tightened by 2 basis points to 96 basis points above the government bonds curve. The index earned an absolute return of -0.29%. German 10-year government bond yields ended the month at 0.42%, an increase of 6 basis points compared to the end of November.

In addition to the imminent reduction of the ECB’s bond-buying programme from EUR60 billion to EUR30 billion a month, higher government bond yields are also being driven by the expectation of persisting robust economic growth in Europe. Economic indicators for both industry and services in the Eurozone are pointing to the strongest level of growth since 2011. Economic growth also remains robust outside Europe. In the short term, US growth will be boosted further by the wide-scale tax cuts approved by US Congress this month. The reduction in the tax rate on corporations from 35% to 21% means that companies will benefit most.

The European credit market was shocked by alleged accounting fraud at South Africa’s Steinhoff. As a result of the uncertainty surrounding the accuracy of Steinhoff’s financial reporting and indications that suppliers are shortening their payment terms, rating agency Moody’s lowered its Baa3 rating to Caa1. Partly because of this, the EUR800 million bond issued by Steinhoff in July 2017 fell by over 45 points.

Several mergers and acquisitions were also announced in December. Walt Disney let it be known that it wishes to acquire shares in media company 21st Century Fox (including its share in Sky) for EUR55.9 billion. Two major takeovers were also announced in the real estate sector. Unibail-Rodamco wishes to acquire Australia’s Westfield for EUR18.6 billion, while Hammerson aims to take over UK peer Intu Properties for EUR9.2 billion. The above transactions will be financed entirely or largely by shares. This is not the case in the planned acquisition for EUR5.4 billion of cybersecurity company Gemalto by French defence conglomerate Thales, which will be financed completely via loans and cash. As a result, Moody’s and S&P have warned of a potential cut to Thales’ credit rating.

The supply of new bonds was EUR10.2 billion in December and therefore about 7% up on December 2016, but 81% down on November 2017. Non-financial sector institutions issued EUR6.4 billion in new bonds during the month, while financial sector institutions issued EUR3.9 billion in new bonds. Across 2017 as a whole, the supply of new bonds stood at EUR512.6 billion, a drop of 4% compared to 2016.

Portfolio developments per 2017-12-31

Across the month, the portfolio’s sensitivity to market trends varied between 106% and 110%. The portfolio held a relatively slight overweight positioning in terms of market risk.

Our positioning in the ABS, retail and oil & gas sectors performed relatively well in December. In contrast, our positioning in the telecom, healthcare and food sectors contributed negatively to the return. Our liquidity position (in the shape of cash and government bonds) had a relatively neutral impact.

At individual company level there were positive contributions from the overweights in Kensington (ABS), Sky and Delta Lloyd. The underweights in Steinhoff and DVB Bank also contributed positively. However, the underweights in Bayer and CNP Assurances and the overweights in Telecom Italia and Cellnex made a negative contribution.

In December, the Fund participated in new bond issues by CK Infrastructure, Deutsche Post and OMV.

Outlook
The lack of dispersion in the interest 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, especially when the decrease in credit quality is taken into account and when adjustments are made for longer average bond durations. We also continue to see risks in the current conflict between the US and North Korea. Yet two positive trends are helping to offset these risks. Firstly, for the time being the European credit market will continue to be boosted by the ECB’s CSPP. Secondly, companies will be reasonably successful in maintaining earnings levels given the robust economic growth in almost all major regions. In view of these latter trends, we will maintain our slight overweight positioning in the coming months.
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 2017-12-31 (rebased)

No chart data available

Performance per 2017-12-31

Slide to see more
  Fund Benchmark
1 month -0.3 % -0.3 %
3 months 0.7 % 0.6 %
This year 2.4 % 2.4 %
2014 9.0 % 8.2 %
2015 -0.0 % -0.7 %
2016 5.1 % 4.7 %
3 years (on annual basis) i 2.5 % 2.1 %
5 years (on annual basis) i 3.8 % 3.3 %
Since inception (on annual basis) i 5.9 % 4.8 %
On 23 July 2013, the rebate free class (AN) of Kempen (Lux) Euro Credit Fund was launched. The results shown of the period 30 January 2012 until 23 July 2013 are those of class A of the same fund. The higher management fee of Class A has had an impact on the performance quoted. On 20 June 2013, Kempen Euro Credit Fund (KECF) was merged with Kempen (Lux) Euro Credit Fund. Up to 30 January 2012 (start of the Fund’s A class) the performance graph and performance table show the performance of KECF. The average annual TER for the period of April 2008 till June 2013 is 0.91%. Performance is shown after deduction of ongoing charges. 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 (2017-12-31)

Fund
Benchmark
28.0 %
5-7 years
0.0 %
24.5 %
0-3 years
0.0 %
16.6 %
7-10 years
0.0 %
15.6 %
> 10 years
0.0 %
13.6 %
3-5 years
0.0 %
1.6 %
Cash
0.0 %
0.0 %
0-3 year
21.7 %
0.0 %
3-5 year
27.9 %
0.0 %
5-7 year
20.5 %
0.0 %
7-10 year
20.9 %
0.0 %
> 10 year
9.1 %
Totaal
100 %
100 %

Sector allocation (2017-12-31)

32.6 %
Banks
17.5 %
Consumer Goods & Services
8.6 %
Utilities
7.4 %
Financial Services & Real estate
6.7 %
Telecom & Technology
5.7 %
Industry
5.7 %
Insurance
4.3 %
Energy
3.5 %
Basic Materials
2.3 %
Supranational
2.3 %
Other
1.9 %
Health Care
1.2 %
Asset Backed Securities
0.5 %
Sovereign bonds
Totaal
100 %
The cash position is included in ‘Other’.

Rating allocation (2017-12-31)

Fund
Benchmark
40.9 %
BBB
49.4 %
36.1 %
A
40.0 %
6.8 %
AA
10.0 %
6.2 %
AAA
0.6 %
4.5 %
Not Rated
0.0 %
3.8 %
BB
0.0 %
1.6 %
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 (2017-12-31)

1.1 %
1.300% Berkshire Hathaway 2016-24
1.0 %
1.375% Goldman Sachs 2017-24
1.0 %
1.500% ENIIM 2017-27
0.9 %
1.250% BG Energy Capital 2014-22
0.9 %
4.375% Intesa SanPaolo 2012-19
0.8 %
0.625% Landwirtsch.Rentenbank 2015-30
0.8 %
0.850% US Bancorp 2017-24
0.8 %
1.250% KFW 2016-36
0.8 %
4.000% Rabobank 2012-22
0.8 %
0.875% ENGIE 2017-24
Totaal
8.8 %
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
0.05 %
Expected ongoing charges i
0,47 %

Other costs

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Upward swing factor i
0.20 %
Downward swing factor i
0.20 %
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 1%; investors can request KCM for information about the thresholds that were applied in the past.
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
AN i
Investor type
Private
Distributing
No
Benchmark i
Markit iBoxx Euro Corporates Index
Duration hedged
No
Investment category
Credits
Universum
Credits denominated in euro
Inception date
2013-07-23
Domicile
Luxembourg
May be offered to all investors in
Belgium, 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.
Morningstar rating â„¢
Morningstar Analyst rating
Silver

Tradability

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Minimum subscription
Initial subscription €1,000
Listed
no
Subscription/Redemption Frequency
Daily
ISIN i
LU0927664200
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 that we invest in.

Our 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.