Kempen has decided to discontinue its active government bond funds. The return of capital to investors resulting from the discontinuation of the Kempen (Lux) Income Fund will take place on 31 August 2020. Read the official announcement here.

Kempen Lux Income Fund Class LI

Profile

Kempen International Funds SICAV – Kempen (Lux) Income Fund (the Fund) is designed to achieve current income and capital appreciation over the medium-term by investing primarily in a diversified portfolio of fixed income securities. The Fund employs a top down macro perspective along with bottom-up security selection, with a focus on downside protection.

The Fund does not have a benchmark.

On August 31, 2020 Kempen (Lux) Income Fund will be liquidated. The fund will be closed for subscriptions as from July 8, 2020. If you do not wish to participate in the liquidation, you may redeem until the respective cut-off time on August 26, 2020. You can find more information here: https://www.kempen.com/news-and-knowledge/persberichten-2020/kempen-to-discontinue-its-active-government-bond-funds 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 € 300 million. At the launch of the fund on 7 August 2017 this share class carried a discounted management fee for a maximum period of 3 years to facilitate the initial growth of the Fund, the current discounted management fee is 20 bps. The Board of Directors will decide on the conditions and future of this share class once the 3 years period has lapsed i.e. in July 2020.

Management team

Ivo Kuiper, Kim Lubbers, Hans Kamminga

Performance per 2020-05-31 (rebased)

No chart data available

Performance per 2020-05-31

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  Fund
1 month 0.4 %
3 months -1.5 %
This year -1.3 %
2017 0.3 %
2018 -2.5 %
2019 3.4 %
1 year (on annual basis) 0.3 %
Since inception (on annual basis) i -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. (Partial) hedging the interest and credit exposure, results in a lower yield for the portfolio.
More information can be found on the documents page of this fund

Key figures

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Share class size
EUR 34.67 M 2020-05-31
Net Asset Value i
EUR 1,004.43 2020-07-07
Turnover rate
113.90 %
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 2020-05-31

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  Fund
Number of holdings 785
Kempen (Lux) Income 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 Dutch Authority for the Financial Markets (AFM).

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 2020-05-31

The impact of the coronavirus continued to dominate the financial markets in May. Market sentiment improved as the number of new cases continues to fall in many countries and as a result of the massive stimulus from central banks and governments. The focus is now on how quickly countries will ease their lockdowns and what the impact on economic activity will be.

In Europe, the focus was mostly on the European Commission’s proposed recovery plan for assisting member states. The European Commission wants to raise 750 billion euros, of which 500 billion euros will be distributed in grants and 250 billion euros in loans. The package amounts to about 5.4% of the EU’s GDP, will be paid out over four years and needs to be approved by all 27 EU countries. The plan is based on a Franco-German initiative and can be seen as a step towards enhanced fiscal integration within the European Union. In response, the spread on Italian 10-year government bond yields, i.e. the difference versus German government bond yields, tightened by 43 basis points in May.

Earlier in the month, the German Constitutional Court ruled that the ECB’s bond-buying programme partly contravenes the German constitution. This came as a surprise. The court stipulated that the central bank needed to provide more information on the current bond-buying programmes within three months, otherwise the Bundesbank will no longer be permitted to participate in them.

The Eurozone’s economy contracted by 3.8% in the first quarter of 2020 versus the final quarter of 2019. The second quarter is expected to be significantly worse, given that individual economies will only reopen gradually. Those countries that had introduced the most stringent restrictions saw the largest drop in GDP. Italy, Spain and France noted a decrease of about 5%. However, the purchasing manager indices did show a marked improvement in the Eurozone in May, with the index rising from 16.9 to 30.5. This demonstrates that the low is already behind us.

Unemployment in the US reached 14.7%, its highest level since the Second World War. Over 20 million people lost their jobs in April. In May, markets started to price in negative interest rates for the Fed. Fed Chairman Powell warned of considerable downside risks in the economic outlook and that more monetary and fiscal stimulus may well be needed, but he also reiterated several times that the Fed remains averse to negative interest rates.

The trade war between the US and China also flared up again. China recently decided to buy fewer US agricultural products, as a result of which there is very little chance of it meeting the criteria laid down in last year’s agreement.

Portfolio developments per 2020-05-31

In May, the Kempen Income Fund earned a return of 0.37% (the performance may differ according to share class). The spread on corporate bonds versus German government bonds tightened by 17 basis points to 176 basis points, while the spread on the high yield (BB) index narrowed by 54 basis points to 328 basis points. The tighter credit and high yield spreads made a positive contribution to the fund’s performance. Country spreads tightened by 18 basis points at index level over May, driven by the European Commission’s proposed recovery plan. The largest tightening of spreads occurred in Italy, Portugal and Slovenia. Spreads on government-related paper, such as KFW, IBRD and EIB, also narrowed in May.

Our small overweights in Slovenia, Spain, Ireland, Belgium and government-related paper contributed positively to the return, while our underweight in France made a negative contribution. German 10-year government bond yields increased by 14 basis points to -0.45% in May. This contributed negatively to the fund’s performance. Inflation forecasts were also higher in May, making a positive contribution to the relative performance. Our position in Norwegian krone also contributed positively to the performance in May.

At individual company level, positive contributions came from the overweights in Telecom Italia, Ziggo, Total, Ford, Titan Cement, AB Inbev, CNH Industrial, Société Générale and Wintershall Dea, as well as from the underweights in IBM, Vodafone, thyssenkrupp, SPIE and UGI Corporation. In contrast, there were negative contributions from the overweights in VF Corporation, Medtronic, General Electric, TVO and Tank & Rast, as well as from the underweights in BP, Royal Dutch Shell, Mytilineos and Gestamp.

Significant stimulus from central banks and governments will ease the economic impact of the coronavirus. It is difficult to estimate the total impact of the virus on the economy at the moment. Bond yields are likely to stay low for longer. The uncertainty surrounding the evolution of the virus prompts us to be cautious about taking large positions. In May, following a sound performance from investment grade corporate bonds, we again reduced our risk exposure slightly. We are currently hedging 65% of the risk in investment grade corporate bonds and 70% in high yield bonds.
Kempen (Lux) Income 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 Dutch Authority for the Financial Markets (AFM).

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 2020-05-31 (rebased)

No chart data available

Performance per 2020-05-31

Slide to see more
  Fund
1 month 0.4 %
3 months -1.5 %
This year -1.3 %
2017 0.3 %
2018 -2.5 %
2019 3.4 %
1 year (on annual basis) 0.3 %
Since inception (on annual basis) i -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. (Partial) hedging the interest and credit exposure, results in a lower yield for the portfolio.

Dividends

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Distributing
No
Kempen (Lux) Income 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 Dutch Authority for the Financial Markets (AFM).

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 (2020-05-31)

26.3 %
5-7 year
21.0 %
0-3 year
17.6 %
7-10 year
17.0 %
> 10 year
16.9 %
3-5 year
0.9 %
Cash
0.2 %
Other
Total
100 %

Sector allocation (2020-05-31)

38.7 %
Corporates
31.0 %
Government
19.4 %
Financials
9.6 %
Semi-Government
0.2 %
Money Market Funds
0.2 %
Asset-Backed Loans
0.9 %
Other
Total
100 %

Rating allocation (2020-05-31)

5.8 %
AAA
13.5 %
AA
27.9 %
A
32.9 %
BBB
15.7 %
BB
0.8 %
B
2.4 %
Not Rated
0.9 %
Cash
Total
100 %

Top 10 holdings (2020-05-31)

4.8 %
0.625% Corp Andina de Fomento 2019-26
3.4 %
0.350% Italie 2016-21
2.7 %
1.850% Frankrijk I/L 2011-27
2.5 %
0.400% Spanje 2017-22
1.9 %
0.250% CPPIB Capital 2020-27
1.6 %
2.400% Oostenrijk 2013-34
1.6 %
3.750% Noorwegen 2010-21
1.5 %
0.200% Ierland 2020-27
1.4 %
1.750% Frankrijk 2016-39
1.4 %
2.125% Slovenie 2015-25
Total
22.6 %
Kempen (Lux) Income 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 Dutch Authority for the Financial Markets (AFM).

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.

 

An overview of the current swing factors are available here.

 

SWING FACTORS

An overview of the current swing factors are available here.

Ongoing charges

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Management fee i
0.20 %
Service fee i
0.10 %
Taxe d'abonnement i
0.01 %
Indirect costs i
0.05%-0.10% (estimated range)
Expected ongoing charges i
0.36% - 0.41% (estimated bandwith)
Kempen (Lux) Income 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 Dutch Authority for the Financial Markets (AFM).

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

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Share class
LI
Investor type
Institutional
Distributing
No
Duration hedged
No
Investment category
Government bonds
Inception date
2017-08-07
Domicile
Luxembourg
May be offered to professional investors only in
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.

Tradability

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Minimum subscription
Initial subscription: €1,000, additional subscriptions: €1,000
Listed
no
Subscription/Redemption Frequency
Daily
ISIN i
LU1626447269
Kempen (Lux) Income 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 Dutch Authority for the Financial Markets (AFM).

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 (Lux) Income 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 Dutch Authority for the Financial Markets (AFM).

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 & 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

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

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ESG is fully integrated into the investment process of the Kempen (Lux) Income Fund, with analysis 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, government related issuers and corporates.

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1. Exclusion

In line with the general Kempen policy, the Kempen (Lux) Income Fund excludes all countries and companies of the KCM exclusion- or avoidance list. Companies or countries on these lists are either involved in the production of controversial weapons, 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

We flag “low” performing countries and companies. The portfolio managers of the Kempen (Lux) Income Fund and the underlying funds, assesses the materiality of the ESG issue and its implications for the credit profile of the company or country. If an issue is deemed material, our first objective is to engage on the issue. If we can conclude from the engagement that the ESG concerns are not structural and if the company is willing to improve, we make an adjustment in the determination of the relative value of the company’s securities. In severe cases where we do not see any prospect of improvement we forego investment in the country or company.

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The fund performs a quarterly screening using the database MSCI ESG research. The 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 team.Â

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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;

• Excluding countries and companies based on UN Global Compact criteria;

• Excluding controversial weapon producers.

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Finally, the Kempen (Lux) Income Fund prefers Green bonds rather than a ‘normal bond’ if two bonds have the same risk/return characteristics. We are an active player in the market of green bonds and we have a green bond policy which outlines the guidelines we adhere to defining a green bond.

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3. Active ownership

Where relevant our fund will attempt to use its ownership stakes to engage with investees on ESG issues. For example, in 2018 the fund was part of an engagement with Bayer, following their acquisition of Monsanto. Through the acquisition, Bayer inherited several significant controversies in the field of genetically modified organisms (GMOs). The goal of the 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 the fund has ongoing engagement cases with Volkswagen on its company culture, Cez on the use of thermal coal, Glencore on climate action and Huntsman on ESG disclosure.

Risks

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

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ESG Report
Kempen (Lux) Income 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 Dutch Authority for the Financial Markets (AFM).

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.