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R-co Conviction High Yield Euro

(*) Inactive share

Fixed income Range : Conviction Region : Euro zone EUR
FR0011716331

Net Asset Value

1230.43 €

(17/04/2024)

AUM (fund)

37.8 M €

(17/04/2024)

Performance

+2.38 %

(YTD) (17/04/2024)

Recommended investment horizon

5 years

Risk scale

3/7

Investment objective

R-co Conviction High Yield Euro is classified as a UCITS containing “Bonds and other debt securities denominated in euros”. With a minimum recommended investment horizon of 5 years, this FCP mutual fund’s investment strategy is to outperform the benchmark index, BofA Merrill Lynch BB-B Euro High Yield Constrained Index, by investing mainly in speculative high-yield negotiable bonds and debt securities.

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 : 12/03/2014
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.

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
21.86% 5.30% -0.29% 10.67% 2.38% -0.19% 1.99% 1.04% -0.10%
35.71% 9.75% 1.76% 10.00% 1.24% -0.38% 3.10% 1.88% 0.58%
R-co Conviction High Yield Euro C EUR
100% The BOFA ML BB-B Euro High Yield Constrained Idx
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 3.20% 3.29% 0.77% 0.9236 2.2341
3 years 6.02% 5.21% 1.38% -0.4466 -0.2412

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.
The fund outperformed its benchmark index (HEC4) over the period. Risk premiums widened by an average 7bp in March. Changes by rating were as follows: BB (-7bp), B (+42bp) and CCC (+64bp). These movements reflect strong sector dispersion and the impact of specific risk. Over the period, 16 sectors (out of 18) posted a positive performance, the two exceptions being financial services (-1.04%) and telecommunications (-0.3%). Specific risk weighed heavily this month, with SFR/Altice bonds losing 10% following Patrick Drahi’s decision to use cash from recent asset sales (Altice Media, data centres, etc.) as a bargaining tool to force creditors to make an effort on the amounts of their debts. Intrum AB bonds dipped 10% following the initiation of discussions with creditors on debt rescheduling. Neither case calls for a liquidity provision, which reduces the chances of an extremely unfavourable scenario. The real estate sector continued to rebound (+4.3%), driven by a 27bp tightening (average OAS of 790bp). As in February, the performance of the sector can be attributed to the contribution (positive or negative) of a small number of issuers, reflecting the importance of selection. SFR/Altice and Intrum AB bonds made a negative contribution of -0.22%. The top five issuers (CPI Properties, Eutelsat, Cellnex and Heimstaden AB) made a positive contribution of +0.21%. Primary market activity picked up, with 13 deals for a total volume of around €7.2bn. These deals mainly concern the refinancing of BB issues. We invested in Fnac, Plastic Omnium, Progroup and CBR. Our performance was driven by positive contributions from CPI, Heimstaden and Aroundtown. In relative terms, SFR and Intrum made a positive contribution. Conversely, our underexposure to Eutelsat, WeBuild and Rakuten proved detrimental.

Summary Risk Indicator

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Managers

Kristell Agaesse

Head of High Yield & Convertible Bonds

See biography

Michael Longeard

High Yield & Convertible Bonds Portfolio Manager

See biography

Emmanuel Petit

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

See biography

Features

  • ISIN code : FR0011716331
  • Legal form : Unit Trust
  • AMF Classification : Bonds and other debt securities denominated in euros
  • Inception date : 12/03/2014
  • Management company : Rothschild & Co Asset Management
  • Custodian : Rothschild Martin Maurel
  • Dividend Policy : Accumulation
  • Reference indicator : 100% The BOFA ML BB-B Euro High Yield Constrained Idx
  • 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 : 1/1000th share(s)
  • Management fees (maximum) : 1.2%
  • Entry fee (maximum) : 2%
  • Exit fee (maximum) : None
  • Performance fee : 15% above [100% The BOFA ML BB-B Euro High Yield Constrained Idx]

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