The Berenberg EM Bonds fund uses an active investment process to invest in attractive government and quasi-sovereign bonds from emerging markets that offer above-average return potential compared to traditional EUR fixed income investments. Using a combination of systematic and discretionary components in the investment process, the fund manager selects bonds from fundamentally convincing emerging markets or government-related companies for the portfolio. The investment strategy is underpinned by ongoing country risk management and active interest rate duration management. The foreign currency risk is generally hedged.
- Fundamental investment approach in government and quasi-sovereign bonds from Emerging Markets with active duration management
- Active positioning against a market benchmark
- Average duration is between 0 and 10 years
- Investment segments are primarily (quasi) government bonds in hard currencies
Further details on the opportunities and risks of this fund can be found in the sales prospectus.
Performance in 12-month periods
Monthly market comment
After the strong rally at the end of the year, the new year started with a consolidation. Market participants considered the cutting cycle priced in in the USA, which is supposed to start as early as March, to be too optimistic. Similarly, US Federal Reserve Chairman Powell made comments at the FOMC press conference. On a monthly basis, US yields have risen, especially at the long end. All emerging market bonds segments had to handle with high volumes of new issues and further outflows this month. This situation led to a widening of spreads. The fund Berenberg EM Bonds participated selectively in new issues and reduced the duration from a risk management perspective.