Kempen Lux Euro High Yield Fund Class LR

Profile

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. Attention: it is envisaged that this share class will be closed for further subscriptions once the Fund (all share classes combined) reaches a size of € 150 million. The discounted management fee of 32bps will remain for a period of 3 years starting at the launch of the share class, to facilitate the initial growth of the Fund. After this period the Board of Directors will decide on the conditions and future of this share class.

Management team

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

Performance per 2018-11-30 (rebased)

No chart data available

Performance per 2018-11-30

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  Fund Benchmark
1 month -1.4 % -1.5 %
3 months -1.6 % -1.9 %
This year -2.2 % -2.7 %
2017 2.3 % 1.6 %
1 year (on annual basis) -2.3 % -2.8 %
Since inception (on annual basis) i 0.1 % -0.8 %
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 33.54 M 2018-11-30
Share class size
EUR 0.42 M 2018-11-30
Net Asset Value i
EUR 24.93 2018-12-14

Fund characteristics per 2018-11-30

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  Fund Benchmark
Number of holdings 132 565
Duration i 4.3 4.4
Yield to maturity 3.4 % 3.2 %
Kempen (Lux) Euro High Yield 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.

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 2018-11-30

In November, the spread on the ML Q964 Index widened by 46 basis points to 278 basis points above the swap curve. The index earned an absolute return of -1.50%. German 10-year government bond yields closed November at 0.31%, a decline of 7 basis points compared to the end of October.

Last month’s negative sentiment on the European corporate bond market deteriorated further in November. Investors seem to prefer the safest investments, including German and US government bonds and cash.

There is a long list of risks and trends that are adversely affecting investor sentiment as the end of the year approaches: 1) the burgeoning trade war between China and the US; 2) Italy’s high level of sovereign debt; 3) waning societal support for President Macron’s economic reforms in France; 4) a slowdown in economic growth in a number of important regions, such as Europe and Asia; 5) the deteriorating creditworthiness of companies caused by a combination of growing debt positions, lower profitability and decreasing diversification due to the dismantling of conglomerate structures; 6) the end of the ECB’s bond-buying programme; and 7) continued de-allocation from the corporate bond asset class.

Brexit continues to be another risk to investor sentiment. Prime Minister May’s final Brexit plan has been very poorly received by the UK parliament. Supporters and opponents of Brexit alike see plenty of reasons to reject the plan. The growing probability that the plan will not be approved is increasing uncertainty about the future trading relationship between the UK and the European Union. Potential alternative scenarios include holding a second referendum, submitting a request to the European Union to delay Brexit in order to have time to develop a new plan or calling early parliamentary elections. British businesses take a negative view of the prospect of a UK government led by the opposition Labour party and its leader Jeremy Corbyn.

Despite the above-mentioned risks, the capital markets did experience a brief upturn in sentiment at the end of the month. The chairman of the US central bank, Jay Powell, said that current interest rates were already close to neutral, i.e. a level that neither stimulates nor curbs the economy. This was significantly different from the language Powell used in October and prompted investors to hope that the series of interest rate hikes in the US was coming to an end.

As of the end of November, the number of bonds that make up the ML Q964 benchmark decreased to 555 and the number of companies in the index fell to 251. The bonds added to the benchmark included a lower tier 2 bond issued by BNP Paribas and a lower tier 2 bond issued by German insurer Munich Re. Bonds issued by Finnish paper and packaging group Stora Enso and Swiss chocolate manufacturer Barry Callebaut have been removed from the index after these two companies were awarded investment grade ratings by Moody’s and S&P respectively. Spanish supermarket chain DIA ultimately only spent a single month in the ML Q964 benchmark after both Moody’s and S&P downgraded its ratings further to B2 (from Ba2) and B (from BB-) respectively. These examples of adjustments to ratings show that differences between companies are again growing (dispersion) and that the market increasingly reflects the performance of companies in spreads.

The number of new bonds issued by non-financial institutions in the European high yield market amounted to EUR2.5 billion in November, about 75% down on last year. European high yield bonds worth EUR65.2 billion were issued by non-financial institutions during the first eleven months of this year, a drop of 31% compared to the same period last year.

Portfolio developments per 2018-11-30

During the month, the portfolio’s sensitivity to market trends varied between 100% and 104%. The portfolio therefore held a slight overweight positioning in terms of market risk.

Our positioning in the retail, telecom and auto sectors performed relatively well in November. In contrast, our positioning in the industrial goods, banking and real estate sectors contributed negatively. Our liquidity position had a positive impact.

At individual company level, positive contributions came from the overweights in Tesco, RWE DEA and DS Smith, as well as from the underweights in Telecom Italia, Jaguar Land Rover, Grupo Antolin and thyssenkrupp. In contrast, the overweights in Colfax, Volkswagen, Samvardhana Motherson and Aroundtown contributed negatively to the return.

In November, the Fund participated in new bond issues by BNP Paribas and Volkswagen.

Outlook
We will maintain our conservative positioning for the time being. This reflects our concerns about the trend for de-allocation from the general credits asset class and the end of the ECB’s CSPP programme. At the same time, we continue to see opportunities in bonds issued by companies with improving credit profiles that may well see their ratings upgraded to investment grade.
Kempen (Lux) Euro High Yield 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.

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 2018-11-30 (rebased)

No chart data available

Performance per 2018-11-30

Slide to see more
  Fund Benchmark
1 month -1.4 % -1.5 %
3 months -1.6 % -1.9 %
This year -2.2 % -2.7 %
2017 2.3 % 1.6 %
1 year (on annual basis) -2.3 % -2.8 %
Since inception (on annual basis) i 0.1 % -0.8 %
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 High Yield 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.

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 (2018-11-30)

Fund
Benchmark
27.7 %
5-7 year
32.2 %
25.1 %
3-5 year
27.7 %
17.5 %
7-10 year
15.2 %
14.5 %
> 10 year
5.6 %
12.8 %
0-3 year
19.3 %
2.3 %
Cash
0.0 %
Totaal
100 %
100 %

Sector allocation (2018-11-30)

32.0 %
Consumer Goods & Services
15.8 %
Industry
10.2 %
Telecom & Technology
8.6 %
Banks
8.6 %
Basic Materials
5.9 %
Insurance
5.7 %
Financial Services & Real estate
5.4 %
Utilities
3.6 %
Energy
2.4 %
Health Care
2.1 %
Other
Totaal
100 %

Rating allocation (2018-11-30)

3.1 %
A
22.2 %
BBB
70.5 %
BB
1.2 %
B
0.6 %
Not Rated
2.3 %
Cash
Totaal
100 %

Top 10 holdings (2018-11-30)

2.0 %
4.561% Casino Guichard 2013-23
2.0 %
1.875% Adler Real Estate 2018-23
1.9 %
3.500% Orano 2010-21
1.8 %
3.375% Crown Euro 2015-25
1.7 %
3.375% Volkswagen PERP 2018-24
1.7 %
2.625% Telefonica Europe PERP 2017-23
1.6 %
4.250% Huntsman 2016-25
1.6 %
4.000% Unitymedia Hessen 2014-25
1.6 %
3.500% Unitymedia Hessen 2015-27
1.5 %
3.500% Titan Global 2016-21
Totaal
17.4 %
Kempen (Lux) Euro High Yield 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.

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
0.30 %
Downward swing factor i
0.30 %
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%. As of 22 September 2017 the swing factor has been adjusted from 0.40% to 0.30%.
Kempen (Lux) Euro High Yield 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.

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
LR
Investor type
Private
Distributing
No
Benchmark i
BofA Merrill Lynch Composite Index
Duration hedged
No
Investment category
Credits
Universum
Credits denominated in euro
Inception date
2017-07-31
Domicile
Luxembourg
May be offered to all investors in
Belgium, Luxembourg, The Netherlands
UCITS status i
Yes
Status
Open-end i
Base currency
EUR
Share class currency
EUR
Management company
Kempen Capital Management N.V.
Custodian
J.P. Morgan Bank Luxembourg S.A.

Tradability

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Minimum subscription
Initial subscription: €1,000, additional subscriptions: €1
Listed
no
Subscription/Redemption Frequency
Daily
ISIN i
LU1626446964
Kempen (Lux) Euro High Yield 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.

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 High Yield 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.

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 full voting records are available here.

Kempen (Lux) Euro High Yield 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.

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.