Investment Strategy
The Berenberg EM Local Bonds fund pursues a global (ex-euro) bond strategy in local currencies that invests in both developed and emerging market bonds and actively manages the weighting of the two segments relative to each other depending on their relative attractiveness. Its primary objective is to benefit from the yield advantage of foreign currency bonds over euro investments and the appreciation of (foreign) currencies against the euro. Using a systematic investment approach, the economically strongest countries are selected, taking into account fundamental, momentum and sentiment indicators. The duration is actively managed at the country level and is generally in the short- to medium-term maturity range.
- Global investment strategy in local currency bonds (ex EUR)
- Active positioning against a market benchmark
- Average duration is between 2 and 5 years
- Investment segments are mainly (quasi) government bonds in local currency
Learn more about our Berenberg Fixed Income investment philosophy
Further details on the opportunities and risks of this fund can be found in the sales prospectus.
Indexed performance
Performance in 12-month periods
Currencies
Sectors
Countries
Asset classes
Top Holdings
Monthly market comment
Supported by dovish signals from the FOMC meeting, US Treasury yields declined by 4 to 7 basis points (bps) over the month. Although the decline was not significant, the decreasing volatility in yield movements brought relief to the segment of local currency bonds in emerging markets, allowing the segment to end the month with a slight positive performance. The Berenberg EM Local Bonds Fund was able to outperform its benchmark in this environment, particularly through an overweight position in Latin America. Over the course of the month, the duration was reduced on some curves. The allocation to India was further increased considering stable performance and the upcoming index inclusion. Positions in Eastern Europe were also optimized.