Kempen (Lux) Euro Government Fund - Class I

Profile

Kempen International Funds SICAV – Kempen (Lux) Euro Government Fund (the Fund) is designed and managed to provide the cornerstone investment to a large variety of investment portfolios. The objective of this actively managed fund is both capital protection as well as a potential upside for the investor. The Fund invests in fixed income euro denominated securities issued by governments, and by government related entities of the countries included in the Euro Government Index. These countries are all members of the Eurozone with an investment grade rating.

The Sub-Fund may also invest in bonds guaranteed by public European bodies provided that these entities have an investment grade Rating. The Fund aims to achieve a better long-term total return than its benchmark, the Bank of America Merrill Lynch Euro Government Index (the benchmark).

Management team

Hans Kamminga, Kim Lubbers

Performance per 2019-08-31 (rebased)

No chart data available

Performance per 2019-08-31

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  Fund Benchmark
1 month 2.4 % 2.5 %
3 months 6.4 % 6.6 %
This year 10.1 % 10.5 %
2016 3.7 % 4.0 %
2017 0.3 % -0.4 %
2018 -0.0 % 1.0 %
1 year (on annual basis) 11.4 % 12.0 %
3 years (on annual basis) i 2.6 % 2.7 %
5 years (on annual basis) i 3.2 % 3.5 %
Since inception (on annual basis) i 4.1 % 4.3 %
Before 1 August 2017 the Fund had a different name and investment policy: Kempen (Lux) Euro High Grade Government Fund and was allowed to only invest in bonds issued by Netherlands, Germany, Austria, France and Finland. On 28 February 2013, Kempen Euro High Grade Pool (KEHGP) was moved to Luxembourg and renamed Kempen (Lux) Euro High Grade Government Fund (the Fund). Up to 28 February 2013 the performance graph and performance table show the performance of KEHGP. 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 131.48 M 2019-08-31
Share class size
EUR 79.89 M 2019-08-31
Number of shares
54,414 2019-08-31
Net Asset Value i
EUR 1,451.37 2019-09-17
Morningstar rating â„¢

Fund characteristics per 2019-08-31

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  Fund Benchmark
Number of holdings 98 369
Duration i 8.0 8.4
Yield to maturity -0.1 % -0.1 %
Kempen (Lux) Euro Government 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., Bleicherweg 7, CH-8027 Zurich, Switzerland. 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 2019-08-31

August was a volatile month for the financial markets. The news was dominated by the trade war and the growing risk of an economic slowdown. Economic data in the Eurozone were worse than expected; Germany stands on the eve of a (technical) recession. The German economy contracted by 0.1% in the second quarter, and the Bundesbank expects the decrease in orders for cars and industrial equipment to persist in the third quarter.

Bond yields fell in response to this. US 10-year government bond yields dropped by 50 basis points and their German counterparts by nearly 30 basis points. Yield curves in the Eurozone and US flattened considerably. The 2 to 10-year curve in the US even became inverted for the first time since 2007. This is normally a reliable indicator of a recession in the US. European bond yields also broke records, with the whole Dutch and German yield curves becoming negative at the end of the month.

Italy was a source of positive news in August. Salvini plugged the plug on the government in early August in the hope of winning a majority in an early election. In fact,the Five Star Movement and Partito Democratico (PD) agreed to form a government. The financial markets welcomed the new government and Italian 10-year government bond yields fell to below 1% for the first time in history. The general belief is that this government will be more willing to comply with European budgetary rules.

With a view to tackling the weaker economic sentiment and lower inflation forecasts, it looks as if central banks will revert to being more expansionary-minded in the next few months. The markets anticipate the US central bank cutting interest rates four times over the coming year, while the ECB is expected to cut interest rates by at least 10 basis points in September and resume its bond-buying programme.

Portfolio developments per 2019-08-31

The decrease in German government bond yields had a negative effect on the relative performance due to the portfolio’s underweight in sensitivity to interest rates versus the benchmark. Inflation forecasts also fell in August, having a further negative impact on the relative performance. Our underweights in Slovenia and government-related institutions, together with our underweight in France, contributed positively. During the month we took profit on several government-related positions. Spreads widened by a few basis points in Ireland and Spain and this also contributed negatively to the performance.

The portfolio is positioned for higher bond yields and tighter spreads. The much worse than expected growth forecasts and the willingness of central banks to pursue expansionary monetary policies were not our central scenario, but these have had a significant impact on the financial markets. A great deal of negative news has already been priced in with interest rate cuts of 20 bps from the ECB and 100 bps from the Fed. The new Italian government is positive for market sentiment, and a potential increase in spending by European governments could push up bond yields.

 

 

 

Kempen (Lux) Euro Government 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., Bleicherweg 7, CH-8027 Zurich, Switzerland. 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 2019-08-31 (rebased)

No chart data available

Performance per 2019-08-31

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  Fund Benchmark
1 month 2.4 % 2.5 %
3 months 6.4 % 6.6 %
This year 10.1 % 10.5 %
2016 3.7 % 4.0 %
2017 0.3 % -0.4 %
2018 -0.0 % 1.0 %
1 year (on annual basis) 11.4 % 12.0 %
3 years (on annual basis) i 2.6 % 2.7 %
5 years (on annual basis) i 3.2 % 3.5 %
Since inception (on annual basis) i 4.1 % 4.3 %
Before 1 August 2017 the Fund had a different name and investment policy: Kempen (Lux) Euro High Grade Government Fund and was allowed to only invest in bonds issued by Netherlands, Germany, Austria, France and Finland. On 28 February 2013, Kempen Euro High Grade Pool (KEHGP) was moved to Luxembourg and renamed Kempen (Lux) Euro High Grade Government Fund (the Fund). Up to 28 February 2013 the performance graph and performance table show the performance of KEHGP. 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 Government 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., Bleicherweg 7, CH-8027 Zurich, Switzerland. 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 (2019-08-31)

Fund
Benchmark
36.3 %
> 10 year
32.9 %
20.2 %
7-10 year
17.2 %
18.1 %
3-5 year
17.0 %
16.8 %
0-3 year
18.4 %
8.6 %
5-7 year
14.5 %
0.0 %
Cash
0.0 %
Total
100 %
100 %

Top 10 holdings (2019-08-31)

4.5 %
0.350% Italie 2016-21
3.7 %
2.750% Spanje 2014-24
3.6 %
2.375% Heta Asset Resolut 2012-23
3.2 %
1.850% Italie 2017-24
3.1 %
1.450% Italie 2015-22
2.4 %
1.350% Ierland 2018-31
2.3 %
2.200% Italie 2017-27
2.3 %
1.850% Frankrijk I/L 2011-27
2.2 %
4.750% Italie 2008-23
2.2 %
3.000% Slovenia 2014-21
Total
29.4 %

Geographic allocation (2019-08-31)

23.8 %
Italy
15.5 %
Spain
15.3 %
France
10.2 %
Austria
7.4 %
Germany
5.0 %
Ireland
4.4 %
Netherlands
4.2 %
Slovenia
3.9 %
Belgium
3.9 %
Finland
3.5 %
European M.C.F.
2.0 %
Portugal
1.0 %
Luxembourg
0.0 %
Cash
Total
100 %
Kempen (Lux) Euro Government 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., Bleicherweg 7, CH-8027 Zurich, Switzerland. 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
0.20 %
Service fee i
0.07 %
Taxe d'abonnement i
0.01 %
Expected ongoing charges i
0.28 %

Other costs

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Upward swing factor i
0.05 %
Downward swing factor i
0.05 %
Kempen (Lux) Euro Government 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., Bleicherweg 7, CH-8027 Zurich, Switzerland. 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
I i
Investor type
Institutional
Distributing
No
Benchmark i
Bank of America Merrill Lynch Euro Government Index
Duration hedged
No
Investment category
Government bonds
Universum
Government bonds in euro
Inception date
2013-02-28
Domicile
Luxembourg
May be offered to professional investors only 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.
Depositary and custodian
J.P. Morgan Bank Luxembourg S.A.
Morningstar rating â„¢

Tradability

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Minimum subscription
Initial subscription: €50,000, additional subscriptions: €10,000
Listed
no
Subscription/Redemption Frequency
Daily
ISIN i
LU0880055461
Kempen (Lux) Euro Government 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., Bleicherweg 7, CH-8027 Zurich, Switzerland. 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 Government 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., Bleicherweg 7, CH-8027 Zurich, Switzerland. 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's vision and mission

Kempen Capital Management is an asset manager that believes in stewardship and investment focusing on the long-term for the benefit of all stakeholders. Value creation is at the heart of the services we provide to our clients. We believe that being an engaged shareholder on environmental, social and governance (ESG) issues and retaining a long-term focus, is critical to helping our clients to preserve and create sustainable wealth that has positive real world impact and economic returns.

Kempen wide approach to responsible investment

We are committed to create sustainable alpha. The four pillars of our ESG-policy are:

  • ESG integration: Ensuring sustainability risks and opportunities are adequately considered in our investment analysis and processes.

  • Exclusion & avoidance: Not investing in companies involved in controversial activities or conduct.

  • Active ownership: Being responsible stewards of our clients’ capital and using our influence through engagement and voting to improve corporate behaviour on specific ESG issues and achieve positive change

  • Positive impact: Investing with an objective to achieve positive real world outcomes and impact, such as contributing to the UN Sustainable Development Goals.

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To put our mission and vision into practice we engage with our investee companies on a wide array of strategic, financial, and ESG topics. As an active owner we use our influence to improve our investee companies’ ESG performance.  This helps us address some of the most pressing and important sustainability issues facing business and the world. Our focus themes for engagement are: human rights, labour rights, climate change and governance.

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Through collaboration with other investors and industry think tanks we contribute to the development of principles and standards of corporate responsibility both at sector levels, as well as investee company level.

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Our full voting records are available here.

OUR FUND APPROACH TO RESPONSIBLE INVESTMENT

The ESG policy is fully implemented into the investment process of the Euro Government Strategy, with the key pillars in our approach being: Exclusion and ESG integration.

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1.   Exclusion

The fund follows the clear and transparent exclusion framework developed by Kempen. This includes exclusions for controversial weapon producers and the screening out of countries and companies based on UN Global Compact criteria. Such exclusions are reviewed as part of a quarterly process.

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2.    ESG integration

ESG analysis is undertaken both pre-investment and as part of our portfolio monitoring activities. Portfolio managers perform an in-depth analysis of ESG data, and ESG risks and opportunities are taken into account when selecting and monitoring governments and government-related issuers.

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First, as shown in the figure on the right side, ESG factors are a crucial part of the fundamental analysis used to generate a country score. The relative country valuation process includes several fundamental qualitative indicators covering each section of ESG. The portfolio managers assess the materiality of the ESG issue and its implications for the credit profile of the issuer.

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Second, the fund performs a quarterly screening using research provided by MSCI ESG. Kempen’s Responsible Investment team conducts the screening, and a review of the ESG ratings of bonds in the portfolio along with discussions on ESG rating developments are conducted by the Euro Government team.

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The following items are discussed on a quarterly basis:

• A review of the ESG ratings of bonds in the portfolio;

• A discussion on any developments / changes in the ESG ratings;

• Screening for controversies using MSCI ESG research;

• Exclusions, as detailed above.

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Finally, we are an active player in the market of green bonds and have a green bond policy which outlines the guidelines we adhere to defining a green bond. The Euro Government strategy will invest in green bonds rather than a ‘normal bond’ if the two bonds have the same risk/return characteristics.

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*

Although Kempen Capital Management N.V.’s information providers, including without limitation, MSCI ESG Research LLC and its affiliates (the “ESG Parties”), obtain information from sources they consider reliable, none of the ESG Parties warrants or guarantees the originality, accuracy and/or completeness of any data herein. None of the ESG Parties makes any express or implied warranties of any kind, and the ESG Parties hereby expressly disclaim all warranties of merchantability and fitness for a particular purpose, with respect to any data herein. None of the ESG Parties shall have any liability for any errors or omissions in connection with any data herein. Further, without limiting any of the foregoing, in no event shall any of the ESG Parties have any liability for any direct, indirect, special, punitive, consequential or any other damages (including lost profits) even if notified of the possibility of such damages.

ESG Report
qo
Screening MSCI Research
Screening MSCI Research
Source
Disclaimer
Kempen (Lux) Euro Government 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., Bleicherweg 7, CH-8027 Zurich, Switzerland. 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.