- Kempen
- Kempen Lux Euro High Yield Fund Class I
Kempen Lux Euro High Yield Fund Class I
Profile
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.
Management team
Performance per 2019-11-30 (rebased)
Performance per 2019-11-30
Fund | Benchmark | |
---|---|---|
1 month | 0.3 % | 0.3 % |
3 months | 0.1 % | -0.2 % |
This year | 10.0 % | 9.2 % |
2017 | 2.3 % | 1.6 % |
2018 | -2.5 % | -2.9 % |
1 year (on annual basis) | 9.8 % | 8.9 % |
Since inception (on annual basis) i | 4.0 % | 3.3 % |
Key figures
Total fund size | EUR 36.30 M 2019-11-30 |
Share class size | EUR 21.16 M 2019-11-30 |
Number of shares | 19,375 2019-11-30 |
Net Asset Value i | EUR 1,096.30 2019-12-13 |
Fund characteristics per 2019-11-30
Fund | Benchmark | |
---|---|---|
Number of holdings | 145 | 572 |
Duration i | 3.5 | 3.5 |
Yield to maturity | 1.7 % | 2.0 % |
Weighted rating | BBB- | BB+ |
Paying agent and representative in Switzerland is RBC Investor Services Bank S.A., Esch-sur-Alzette, Zurich Branch, Bleicherweg 7, CH-8027 Zurich. The Sub-Fund is registered with the Dutch Authority for the Financial Markets (AFM) under the license of the Fund.
The information in this document provides insufficient information for an investment decision. Please read the Key Investor Document (available in Dutch, English and several other languages, see website) and the prospectus (available in English). 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/en/asset-management). The information on the website is (partly) available in Dutch and English.
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 2019-11-30
Despite the recent relaunch of the ECB’s quantitative easing programs, bond yields increased during the month. Bond yields, in particular, have been increasing for a number of months now, driven by a number of factors. First, economic indicators suggest that global economic growth is tentatively stabilising, thereby reducing the probability of a deflationary scenario taking root. Second, investors are positioning themselves for an eventual agreement between China and the United States being reached regarding their long-term trading relationship. Finally, prospects for a Conservative majority in the British parliament following elections scheduled for the 12th of December contributed to receding fears about a hard Brexit.
Spreads on high-yield rated corporate bonds tightened during the month, outperforming the investment grade credits asset class. Greater confidence amongst investors that a recessionary economic environment will be averted contributed to the further spread compression between high-yield and investment grade companies.
At the end of November, the number of bonds that make up the ML Q964 benchmark increased by 5 to 578, while the number of companies increased by 2 to 253. Additions to the benchmark included two senior secured bonds amounting to EUR 1.675 billion from Spain-based blood treatment firm Grifols, a EUR 500 million lower tier 2 bond issued by Austrian banking group Erste Bank, a EUR 750 million corporate hybrid from German chemical group Bayer and two senior unsecured bonds totalling EUR 1.3 billion from US-based packaging group Ball Corporation.
The amount of bonds issued by non-financial institutions in the European high yield market was EUR 13.7 billion in November, roughly 7% less than what was issued in October but more than five times as much as what was issued in the year earlier period. European high yield bonds totalling EUR 82.9 billion were issued in the first eleven months of this year, an increase of 27% compared to last year. Given the attractive all-in cost of funding available to companies in the European high yield market, there has been an increase in the number of issuers replacing bank debt with bonds in their capital structure.
Portfolio developments per 2019-11-30
Our positioning in the media, utilities and insurance sectors performed relatively well in November. In contrast, our positioning in the industrial goods & services, construction materials, and non-bank financial services sectors contributed negatively. Our liquidity position had a negative contribution.
At individual company level, positive contributions came from the overweights in Faurecia, EDF, INA Holdings (Schaeffler holding company), Owens-Illinois and Volkswagen, as well as from our underweights in FiatChrysler, Netflix and ADLER. In contrast, the underweights in Loxam, Tenneco, Corestate, Kongsberg Actuation Systems, as well as our overweights in Titan Cement and Leonardo contributed negatively.
In November, the Fund participated in new bonds issued by Immobiliare Grande Distribuzione, Renault (lower tier-2), AIB Group (lower tier-2), EDF (corporate hybrid), Owens-Illinois, Ball, Standard Industries, Ford and Faurecia.
Outlook
We intend to maintain a relatively defensive positioning in the portfolio. This is primarily driven by the still relatively weak global economy, as well as the limited spread differential that exists between spreads on bonds issued by investment grade companies and the spreads on bonds issued by high-yield rated companies.
Paying agent and representative in Switzerland is RBC Investor Services Bank S.A., Esch-sur-Alzette, Zurich Branch, Bleicherweg 7, CH-8027 Zurich. The Sub-Fund is registered with the Dutch Authority for the Financial Markets (AFM) under the license of the Fund.
The information in this document provides insufficient information for an investment decision. Please read the Key Investor Document (available in Dutch, English and several other languages, see website) and the prospectus (available in English). 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/en/asset-management). The information on the website is (partly) available in Dutch and English.
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 2019-11-30 (rebased)
Performance per 2019-11-30
Fund | Benchmark | |
---|---|---|
1 month | 0.3 % | 0.3 % |
3 months | 0.1 % | -0.2 % |
This year | 10.0 % | 9.2 % |
2017 | 2.3 % | 1.6 % |
2018 | -2.5 % | -2.9 % |
1 year (on annual basis) | 9.8 % | 8.9 % |
Since inception (on annual basis) i | 4.0 % | 3.3 % |
Dividends
Distributing | No |
Paying agent and representative in Switzerland is RBC Investor Services Bank S.A., Esch-sur-Alzette, Zurich Branch, Bleicherweg 7, CH-8027 Zurich. The Sub-Fund is registered with the Dutch Authority for the Financial Markets (AFM) under the license of the Fund.
The information in this document provides insufficient information for an investment decision. Please read the Key Investor Document (available in Dutch, English and several other languages, see website) and the prospectus (available in English). 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/en/asset-management). The information on the website is (partly) available in Dutch and English.
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 (2019-11-30)
Sector allocation (2019-11-30)
Rating allocation (2019-11-30)
Top 10 holdings (2019-11-30)
Paying agent and representative in Switzerland is RBC Investor Services Bank S.A., Esch-sur-Alzette, Zurich Branch, Bleicherweg 7, CH-8027 Zurich. The Sub-Fund is registered with the Dutch Authority for the Financial Markets (AFM) under the license of the Fund.
The information in this document provides insufficient information for an investment decision. Please read the Key Investor Document (available in Dutch, English and several other languages, see website) and the prospectus (available in English). 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/en/asset-management). The information on the website is (partly) available in Dutch and English.
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
Management fee i | 0.52 % |
Service fee i | 0.10 % |
Taxe d'abonnement i | 0.01 % |
Expected ongoing charges i | 0.63 % |
Other costs
Upward swing factor i | 0.30 % |
Downward swing factor i | 0.30 % |
Paying agent and representative in Switzerland is RBC Investor Services Bank S.A., Esch-sur-Alzette, Zurich Branch, Bleicherweg 7, CH-8027 Zurich. The Sub-Fund is registered with the Dutch Authority for the Financial Markets (AFM) under the license of the Fund.
The information in this document provides insufficient information for an investment decision. Please read the Key Investor Document (available in Dutch, English and several other languages, see website) and the prospectus (available in English). 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/en/asset-management). The information on the website is (partly) available in Dutch and English.
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
Share class | I i |
Investor type | Institutional |
Distributing | No |
Benchmark i | BofA Merrill Lynch Composite Index |
Reference index i | BofA Merrill Lynch BB-B High Yield Constrained Index |
Duration hedged | No |
Investment category | Credits |
Universum | Credits denominated in euro |
Inception date | 2017-07-31 |
Domicile | Luxembourg |
May be offered to professional investors only in | Belgium, France, Italy, Luxembourg, Switzerland, The Netherlands, United Kingdom |
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. |
Tradability
Minimum subscription | Initial subscription: €50,000, additional subscriptions: €10,000 |
Listed | no |
Subscription/Redemption Frequency | Daily |
ISIN i | LU1624254121 |
Paying agent and representative in Switzerland is RBC Investor Services Bank S.A., Esch-sur-Alzette, Zurich Branch, Bleicherweg 7, CH-8027 Zurich. The Sub-Fund is registered with the Dutch Authority for the Financial Markets (AFM) under the license of the Fund.
The information in this document provides insufficient information for an investment decision. Please read the Key Investor Document (available in Dutch, English and several other languages, see website) and the prospectus (available in English). 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/en/asset-management). The information on the website is (partly) available in Dutch and English.
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.
Factsheets
Annual Reports
Semi- Annual Reports
Key Investor Information
Formal documents other
Paying agent and representative in Switzerland is RBC Investor Services Bank S.A., Esch-sur-Alzette, Zurich Branch, Bleicherweg 7, CH-8027 Zurich. The Sub-Fund is registered with the Dutch Authority for the Financial Markets (AFM) under the license of the Fund.
The information in this document provides insufficient information for an investment decision. Please read the Key Investor Document (available in Dutch, English and several other languages, see website) and the prospectus (available in English). 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/en/asset-management). The information on the website is (partly) available in Dutch and English.
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:
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ESG integration: Ensuring sustainability risks and opportunities are adequately considered in our investment analysis and processes.
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Exclusion & avoidance: Not investing in companies involved in controversial activities or conduct.
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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
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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.
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OUR FUND APPROACH TO RESPONSIBLE INVESTMENT
Kempen’s ESG policy is fully implemented in our fund’s investment process across the three relevant pillars of: Exclusion, Integration and Active ownership.
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1. Exclusion
In line with the general Kempen policy, the Kempen Euro Credit Strategies[1] 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.
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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
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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.
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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.
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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
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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
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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.
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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.
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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), Glencore on climate action (you can find the engagement factsheet here) and Huntsman on ESG disclosure. In July 2018, Huntsman was upgraded from ‘CCC’ to ‘B’ by MSCI ESG, and the company’s Sustainability report, published in 2018, includes an overview of its progress towards alignment with the UN Global Compact Ten Principles for the first time.
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[1] 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
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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 Partiesâ€), 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




Paying agent and representative in Switzerland is RBC Investor Services Bank S.A., Esch-sur-Alzette, Zurich Branch, Bleicherweg 7, CH-8027 Zurich. The Sub-Fund is registered with the Dutch Authority for the Financial Markets (AFM) under the license of the Fund.
The information in this document provides insufficient information for an investment decision. Please read the Key Investor Document (available in Dutch, English and several other languages, see website) and the prospectus (available in English). 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/en/asset-management). The information on the website is (partly) available in Dutch and English.
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.