Kempen (Lux) Euro High Yield Fund Class BN


Kempen International Funds SICAV – Kempen (Lux) Euro High Yield Fund (the Fund) invests primarily in credits that do not have an investment grade rating (lower than BBB-) and are denominated in Euros. The Fund may deviate from the benchmark, the BofA Merrill Lynch Composite Index, which only includes financial instruments with a minimal rating of BB- (known as ‘High Yield’).

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 while investment risks are continuously monitored. Investments are selected on the basis of an extensive analysis of the terms and conditions of the bond issues. This shareclass of the Fund is not active yet, therefore historical performances are not available yet. The historical returns of the I class offer a reasonable insight into the historical returns of the Fund. Please not that the I class is 0.04% cheaper on an annual basis than the BN class and therefore the returns are slightly higher than the returns of the BN class.

Management team

Alain van der Heijden, Joost de Graaf, Bart aan den Toorn, Harold van Acht, Lizelle du Plessis, Kim Lubbers, Tetiana Kharlamova, Arif Bagasrawalla

Performance per 2021-12-31 (rebased)

No chart data available

Performance per 2021-12-31

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  Fund Benchmark
1 month 0.6 % 0.7 %
3 months 0.1 % 0.1 %
This year 0.1 % 0.1 %
Since inception (on annual basis) i 0.1 % 0.1 %
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 334.04 M 2021-12-31
Share class size
EUR 44.34 M 2021-12-31
Number of shares
1,771,544 2021-12-31
Net Asset Value i
EUR 25.03 2021-12-31
The turnover rate figure is per the end of the financial year of the fund and will be updated once a year.

Fund characteristics per 2021-12-31

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  Fund Benchmark
Number of holdings 160 757
Duration i 4.2 3.8
Yield to maturity 2.3 %
Weighted rating BB+ BB+

Developments per 2021-12-31

In December, the spread on the ICE BofA High Yield Composite Index (Q964) tightened by 21 basis points to around 191 basis points over the swap curve. This is equivalent to 232 basis points over the government bond curve. The index earned a total return of +0.67%. German 10-year government bond yields closed December at -0.18%, representing an increase of 17 basis points compared to the end of November.

December was a surprisingly good month for credit markets after the sell-off in November. This was caused by several factors. Primary activity was limited as is normally the case in December. Demand for credit paper however remained strong and this provided a positive technical backdrop for spreads to tighten. Furthermore, although Omicron did cause corona infection rates to spike, several studies showed that the variant seems to be far less deadly than earlier variants. This helped risk sentiment as well. Lastly, another explanation given was that the expected speedier tightening by the FED would prevent inflation getting out of hand which would allow overall rates to stay low in the intermediate timeframe. We see this as an overly optimistic scenario.

Inflation data stayed at high levels in Europe and the US during the month. They even increased further from already elevated levels. In November US CPI climbed to 6.8% YoY from 6.2% a month earlier, the fastest pace in 40 years.. Core CPI also increased further, from 4.6% to 4.9% YoY. In Europe, CPI increased to 4.9% from 4.1% while core CPI also increased further to 2.6% YoY from 2% the month before. Also more and more companies announced substantial price increases to keep their margins in check. Ikea for example raised prices on average by 9% to offset the impact of higher input costs. Furthermore, the US labor market remains very tight further stoking inflationary forces. Average hourly earnings increased by almost 5% YoY in November. Note that this still doesn’t cover the overall CPI increase.

Economic activity remained at a high and expanding level in the US and Europe although they were slightly lower than the month before. The US ISM manufacturing index came in at 58.7 vs 61.1 in November. In Europe, the Euro Area Composite PMI was largely flat at 53.3. At the end of the month, economic activity seemed to be negatively affected by the consequences of the high Omicron infection rate. This caused employee shortages in various industries as many workers had to go into quarantine or self-isolate. Also demand weakened somewhat as consumers decided to limit their activities to reduce the chance of being infected.

Government bond yields increased in December after tightening in November. This largely happened during the last 10 days of the month and continued during the first week of January. Bund yields widened by 17 bps, OATs by 18 bps and BTPs by 20 bps. Over the whole of 2021, bund yields widened by 39 bps, OATs by 53 bps and BTPs by 63 bps.

In credit, primary markets activity was limited in December. It saw €1.4 bln of issuance in European currencies and no issuance in Yankees (ex-financials, including FRNs). Fixed coupon issuance in European currencies was €1.4 bln. December 2020 saw roughly €6 bln of issuance.

In the broader High Yield universe, we again saw single B and CCC rated bonds both outperformed BB rated bonds during the month. In fact for 2021 as a whole, CCCs (+9.1%) vastly outperformed single Bs (+4.2%) which again clearly outperformed BBs (+2.1%).

In December, HY funds in total saw approximately €0.5 bln in outflow, based on JP Morgan data. The outflow was concentrated in mutual funds while ETFs saw a slight inflow.

In December, Capital Goods, Infrastructure and Food & Beverage were the underperforming sectors. Travel & Leisure, Oil & Gas and Real Estate were the best performing sectors, a reversal of their last month’s underperformance.

The portfolio delivered a return of +0.64% (gross). This was 3 basis points below the benchmark return of +0.67%. During the month, the portfolio’s sensitivity to market trends varied between 101% and 106%. The portfolio therefore held an overweight positioning in terms of market risk in combination with a relatively high cash balance. This cash overweight explained all of the relative underperformance. The contribution to the relative return by sector was small but in general positive. Also the relative return contribution by issuer was small both on the positive side as on the negative side.

The Fund did not participate in new issuance activity in December.

Despite increasing uncertainty caused by higher inflation, rising COVID-19 infection rates and the rapid transmission of the Omicron variant, we remain mildly constructive on the market. US and European economic data remains strong but growth rates are slowing. Companies’ 2021 results are in general strong. However we are currently seeing more aggressive shareholder friendly behaviour, with more companies increasing dividends, launching substantial share buyback programmes or engaging in M&A. With spreads still near all time lows, valuations are considered expensive. The technical backdrop continues to remain supportive for now with the ECB continuing to actively buy corporate bonds and emphasising that actual tapering of assets purchased will be done in a gradual manner. However, as we have seen in the US, this outlook can change quite quickly.

Performance per 2021-12-31 (rebased)

No chart data available

Performance per 2021-12-31

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  Fund Benchmark
1 month 0.6 % 0.7 %
3 months 0.1 % 0.1 %
This year 0.1 % 0.1 %
Since inception (on annual basis) i 0.1 % 0.1 %
Performance is shown after deduction of ongoing charges. The value of your investments may fluctuate. Past performance provides no guarantee for the future.


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Maturity profile (2021-12-31)

30.6 %
3-5 year
36.4 %
25.3 %
5-7 year
23.4 %
15.2 %
0-3 year
24.3 %
12.5 %
7-10 year
10.1 %
9.3 %
> 10 year
5.7 %
7.0 %
0.0 %
100 %
100 %

Sector allocation (2021-12-31)

29.9 %
Consumer Goods & Services
21.2 %
12.1 %
Telecom & Technology
8.0 %
7.3 %
5.0 %
Basic Materials
4.3 %
4.0 %
Financial Services & Real estate
3.8 %
Health Care
2.6 %
1.8 %
100 %

Rating allocation (2021-12-31)

2.2 %
11.9 %
75.4 %
2.8 %
0.8 %
Not Rated
7.0 %
100 %

Top 10 holdings (2021-12-31)

4.3 %
3.021% Ford Motor 2019-24
1.8 %
1.250% Cellnex Finance 2021-29
1.5 %
2.750% ZF Finance 2020-27
1.5 %
3.750% Faurecia 2020-28
1.5 %
3.625% Netflix 2017-27
1.5 %
1.000% Cellnex Finance 2021-27
1.5 %
1.875% Autostrade per Italia 2015-25
1.4 %
2.625% RCI Banque 2019-30
1.3 %
2.250% Iqvia 2019-28
1.3 %
2.125% Volvo 2019-24
17.5 %



An overview of the current swing factors are available here.

Ongoing charges

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Management fee i
0.520 %
Service fee i
0.10 %
Taxe d'abonnement i
0.05 %
Expected ongoing charges i

Share class details

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Share class
BN i
Investor type
Institutional & Private
Benchmark i
BofA Merrill Lynch Composite Index
Reference index i
BofA Merrill Lynch BB-B High Yield Constrained Index
Duration hedged
Investment category
Credits denominated in euro
Inception date
May be offered to all investors in
Luxembourg, The Netherlands, United Kingdom
UCITS status i
Open-end i
Base currency
Share class currency
BNP Paribas Securities Services S.C.A., Luxembourg branch
Management company
Kempen Capital Management N.V.
Depositary and custodian
BNP Paribas Securities Services S.C.A., Luxembourg branch


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Minimum subscription
Initial Subscription: € 1
Subscription/Redemption Frequency

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.


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.


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.


Our full voting records are available here.

Climate change

As a long-term investor, we believe climate change represents a systemic risk facing the economy, society and environment. We want to consider the risks and opportunities this presents to our investments in the coming decades. We have therefore set a long-term commitment (2050), a mid-term ambition (2030) and short-term objectives (2025).

  • 2050 commitment: Net-zero investor.  Â
  • 2030 ambition: To align with a Paris Agreement pathway (listed and non-listed investments) and Dutch Klimaatakkoord.  Â
  • 2025 objectives: To align with a pathway towards achieving the Paris Agreement (listed investments) and Dutch Klimaatakkoord goals.[1]


The Kempen climate change policy can be found here (under climate change policy).


[1]We use carbon intensity as a metric to come to the pathway of net-zero emissions. As we care about the direction of travel and reduction of carbon emissions in the economy, it might be that the actual reducing trend may deviate from the suggested average trend line. The pathway is derived from the pathway of the EU Benchmarks.


Kempen’s ESG policy is fully implemented in our fund’s investment process across the three relevant pillars of:  Exclusion, Integration and Active ownership and impact.


1. Exclusion

In line with the general Kempen policy, the Kempen Euro Credit Strategies[2] exclude all companies on the KCM exclusion- or avoidance list. Companies on these lists are either involved in the production of controversial weapons, they derive a significant portion of their revenues from the production or distribution of tobacco, or have been involved in serious controversies. In addition, we exclude pure coal players and pure players involved in tar sands, as these activities have an adverse impact on climate change.


2. ESG Integration

Responsible Investment in the Kempen Euro Credit Strategies is not limited to the exclusion of companies. Rather, ESG criteria are an integral part of the investment process. To form a fundamental opinion on a company, the portfolio managers assess the business profile, the financial profile and the ESG profile. Research provided by MSCI ESG Research LLC is used as a basis for the ESG assessment.  Â


A low score on ESG criteria can result in the demand for an additional premium on the company’s bonds and/or initiation of an engagement with the issuer. If ESG risks are deemed too severe, an investment in the company will be avoided and/or existing holdings will be sold.


On a quarterly basis, the Kempen Responsible Investment team screens the holdings of the Kempen Euro Credit Strategies, and discusses the findings with the portfolio managers. Special attention is paid to companies scoring an MSCI ESG rating of B or lower, those with a ‘fail’ marked against the criteria of the UN Global Compact or those companies that attract a red flag on the MSCI ESG impact monitor. Companies in carbon intensive sectors are also given special attention. We prefer to invest in companies that integrate climate risks and opportunities into their organisation, and are able to move towards a low- carbon economy.


3. Active Ownership

For our Kempen Euro Credit Strategies, we distinguish between three types of engagement. They are i) an engagement for awareness, ii) an engagement for change, and iii) a public policy and/or systemic engagement. Engagement for awareness is aimed at raising awareness on certain issues with a company and/or collecting more information on a specific ESG issue. Engagement for change, which could follow an engagement for awareness, has the goal of achieving a specific SMART goal. The third form of engagement relates to seeking an improvement in a public policy or a system relevant to wider capital markets


Our engagement process defines four milestones:

1. Raise concern with the company;

2. Company acknowledges the issue;

3. Company sets out a strategy / agrees to improve;

4. Company implements the strategy. Â


Our engagement could start at any of the first three milestones. When a milestone is reached, a document of proof is attached to the engagement case and the engagement will move on to the following milestone. When the fourth milestone is reached, the engagement is closed, but we continue to monitor the company. If at any stage the company refuses to cooperate, divestment has to be considered. To measure willingness to cooperate, we set specific timelines for the engagement. With regard to climate change, we engage generally and take a sector-specific approach for the most carbon-intensive companies and sectors (oil and gas, utilities), as these count for the largest part of the global carbon emissions.


The Kempen Euro Credit Strategies, began an engagement with Bayer in 2018, following their acquisition of Monsanto. Through the acquisition, Bayer inherited several significant controversies in the field of genetically modified organisms (GMOs). The goal of our engagement is to get a formal and written statement from the company which states that they will not sue small holder farmers for the unintended use of Bayer licensed GMO crops. It also asks the company to set a target for the number of farmers that receive education on their crop protection products.


In addition we have ongoing engagement cases with Volkswagen on its company culture, Cez on the use of thermal coal (you can find the engagement factsheet here). We do this direct and collaborative via the Climate Action 100+ engagement initiative.


4. Impact

With regard to climate change we prefer:

  • Green bonds over non-green bonds if the risk-returns are similar. We have (as stated in the 2025 objectives) a green bond target on a ‘comply or explain’ basis (e.g. it must fit with the investment strategy). Targets need to be relevant, although the investment strategy characteristics need to be taken into account.
  • Sustainable (-Linked) / SDG-Linked bonds over non-sustainable / SDG-Linked bonds if the risks-returns are similar. Note that as with green bonds, there are criteria for these bonds and these will be assessed on a case-by-case basis.


[2] The Kempen (Lux) Euro Credit Fund, Kempen (Lux) Euro Credit Fund Plus, Kempen (Lux) Euro Sustainable Credit Fund and Kempen (Lux) Euro High Yield Fund


For more information about the mid and long term risks associated with the investments:



* 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
Screening MSCI ESG Research
Screening MSCI ESG Research
UN global impact
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