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R-co Conviction Credit Euro

Fixed income Range : Conviction Region : Euro zone EUR
FR0007008750
Morningstar Rating™
as of 31/01/2024

Net Asset Value

452.00 €

(17/04/2024)

AUM (fund)

2807.8 M €

(17/04/2024)

Performance

+0.52 %

(YTD) (17/04/2024)

Recommended investment horizon

3 years

Risk scale

2/7

Investment objective

R-co Conviction Credit Euro is invested in private corporate bonds. Its investment universe is essentially composed of Investment Grade securities. R-co Conviction Credit Euro seeks to outperform the Markit iBoxx™ € Corporates index over the recommended investment horizon. The Markit iBoxx™ € Corporates index comprises all euro-denominated fixed interest bonds issued by private and public companies for an amount equivalent to at least EUR 500m.

Change in Net Asset Value

Past performance does not indicate future performance, and is not constant over time. Performance indicated is net of fees, calculated in the reference currency of the unit.

Performance by calendar year

This chart shows the fund’s performance as the percentage loss or gain per year over the last 10 years against its benchmark. It can help you to assess how the fund has been managed in the past and compare it to its benchmark
Inception date of the unit/share : 08/11/2019
Past performance is not a reliable indicator of future performance. Markets could develop very differently in the future. It can help you to assess how the fund has been managed in the past. Performance is shown after deduction of ongoing charges. Any entry and exit charges are excluded from the calculation.
* This sub-fund of the SICAV resulted from the merger by absorption of the R-co Euro Crédit FCP on 8 November 2019. C EUR units of the FCP were created on 22 February 1997 and became C EUR shares of this sub-fund.

Performance as of 17/04/2024

Cumulative performance Annualised performance
10 years 5 years 3 years 1 year YTD 1 month 10 years 5 years 3 years
10.52% 0.78% -4.42% 7.13% 0.52% 0.13% 1.00% 0.16% -1.49%
10.79% -3.19% -7.81% 6.17% -0.21% 0.13% 1.03% -0.65% -2.67%
R-co Conviction Credit Euro C EUR
100% IHS Markit iBoxx EUR Corporates Total Return EUR
Past performance does not indicate future performance, and is not constant over time. Performance indicated is net of fees, calculated in the reference currency of the unit.

Risk indicators as of 17/04/2024

Volatility Ratios
Fund Reference index Tracking-error Information ratio Sharpe ratio
1 year 3.19% 3.87% 1.04% 0.9279 1.0634
3 years 4.25% 5.02% 2.16% 0.5414 -0.6701

Comments

31/03/2024

Yields dipped slightly this month amid a volatile environment, with investors still unsure about upcoming central bank decisions. Mixed employment data in the US initially led to a drop in yields before higher-than-expected inflation dampened these expectations. Uncertainty over the Fed’s two major objectives did not prevent its members from reiterating their desire to reduce the key rate this year. The market is currently expecting fewer than three Fed cuts in 2024 and continues to expect three or four in the eurozone. The 10-year US and German yields dropped by 6bp and 15bp to 4.20% and 2.30%, respectively. Against this backdrop, Italy’s spread continued to tighten, reaching 138bp (-5bp) on the 10-year.
The performance of the European credit market was contrasted in March. Risk premiums continued to tighten in the investment grade segment, with -9bp. All sectors benefited from this momentum, primarily healthcare and real estate (-10bp each) and, to a slightly lesser extent, chemicals (-8bp). The trend was similar for financials, with a sharper compression for subordinated spreads (-12bp) than for senior bonds (-18bp). Conversely, the high yield segment widened by 7bp in March, negatively impacted by particular events, including at Altice and Ardagh. The best-rated debts thus outperformed speculative bonds in March, up 1.21% vs. +0.44%. Momentum was strong in the corporate primary market in March, with €30bn in IG issues and €6bn in HY.
Against this backdrop, the portfolio posted a positive performance, driven by the dip in sovereign yields and a further compression in risk premiums. We are keeping the fund’s sensitivity below that of the index as the market expects a significant drop in rates between now and the end of 2026. Lastly, in view of recent events concerning several high-yield issuers and the low level of risk premiums, we continued to favour the best-rated issuers. For example, we added Australia Pacific Airports and Transurban to the portfolio, while we sold Ceconomy, which has an insufficient return given its credit risk.

Summary Risk Indicator

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Managers

Emmanuel Petit

General Partner, Head of Fixed Income Specialisation: IG Credit & Crossover

See biography

Philippe Lomne

Fixed Income Portfolio Manager Specialisation: IG Credit IG & Crossover

See biography

Features

  • ISIN code : FR0007008750
  • Legal form : SICAV
  • AMF Classification : Bonds and other debt securities denominated in euros
  • Inception date : 08/11/2019
  • Management company : Rothschild & Co Asset Management
  • Custodian : Rothschild Martin Maurel
  • Dividend Policy : Accumulation
  • Reference indicator : 100% IHS Markit iBoxx EUR Corporates Total Return EUR
  • Valuation : Daily
  • Latest time for subscriptions-redemptions : 12:00pm
  • Applicable Net Asset Value : Next NAV
  • Settlement (Settlement date) : NAV + 2
  • Minimum initial subscription : 2500 EUR
  • Subsequent subscriptions : 1/10000th equities
  • Management fees (maximum) : 0.71%
  • Entry fee (maximum) : 2%
  • Exit fee (maximum) : None
  • Performance fee : None

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