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GIPS® Information

T. Rowe Price ("TRP") claims compliance with the Global Investment Performance Standards (GIPS®). TRP has been independently verified for the twenty one- year period ended June 30, 2017 by KPMG LLP. The verification report is available upon request. Verification assesses whether (1) the firm has complied with all the composite construction requirements of the GIPS standards on a firm-wide basis and (2) the firm's policies and procedures are designed to calculate and present performance in compliance with the GIPS standards. Verification does not ensure the accuracy of any specific composite presentation.

TRP is a U.S. investment management firm with various investment advisers registered with the U.S. Securities and Exchange Commission, the U.K. Financial Conduct Authority, and other regulatory bodies in various countries and holds itself out as such to potential clients for GIPS purposes. TRP further defines itself under GIPS as a discretionary investment manager providing services primarily to institutional clients with regard to various mandates, which include U.S, international, and global strategies but excluding the services of the Private Asset Management group.

A complete list and description of all of the Firm's composites and/or a presentation that adheres to the GIPS® standards are available upon request. Additional information regarding the firm's policies and procedures for calculating and reporting performance results is available upon request

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SICAV

Diversified Income Bond Fund

Formerly Global Multi-Sector Bond Fund

The fund invests mainly in a diversified portfolio of high yield corporate bonds from issuers around the world, including emerging markets.

ISIN LU1244139231 Bloomberg TRPGMSI:LX

3YR Return Annualised
(View Total Returns)

Total Assets
(USD)

3.83%
$142.4m

1YR Return
(View Total Returns)

Manager Tenure

1.94%
1yr

Information Ratio
(3 Years)

Tracking Error
(3 Years)

-0.17
6.75%

Inception Date 15-Dec-2016

Performance figures calculated in USD

Other Literature

31-Oct-2020 - Ken Orchard, Portfolio Manager ,
At the beginning of November, with a more certain outcome for the U.S. presidential election, declines in implied volatility, compression of credit spreads, and a decline in the U.S. dollar point to an unambiguously bullish market reaction for riskier assets. The majority of our risk indicators tell us to be long risk. The market appears to be shrugging off coronavirus-related concerns even as virus case data have increased in many regions.
Kenneth A.  Orchard
Kenneth A. Orchard, Portfolio Manager

Kenneth Orchard is a senior portfolio manager in the Fixed Income Division and a member of the Global Fixed Income Investment team. He is a vice president of T. Rowe Price Group, Inc., and T. Rowe Price International Ltd.

 

Strategy

Investment Objective

To maximise the value of its shares through both growth in the value of, and income from, its investments. The fund invests mainly in a diversified portfolio of bonds of all types from issuers around the world, including emerging markets.

Investment Approach

  • To seek diversified sources of income and return by utilizing the full global opportunity set and managing risk.
    • Active tactical allocation across an expanded global opportunity set of 14 fixed income sectors, 80+ countries, and 40+ currencies.
    • Best ideas security selection from proprietary global research platform.
    • Actively diversify risk across both quantitative risk factors and qualitative investment themes.
    • Avoid concentration in any one sector or interest rate cycle.
    • Focus on risk-adjusted returns over a medium to long-term horizon.
  • Target tracking error range: 100-500 basis points

Portfolio Construction

  • Up to 50% of assets may be unhedged to exploit currency valuation opportunities
  • 40% of bonds may be invested outside of the U.S.
  • High Yield: Max 50%, excluding securitized assets
  • Emerging Markets: Max 25% Hard Currency, Max 25% Local Currency
  • Portfolio Average Credit Quality: Target Investment Grade
  • Duration range: 0 to 8 years
  • Number of securities: 200-500

Performance (Class I)

Annualised Performance

  1 YR 3 YR
Annualised
5 YR
Annualised
Since Inception
Annualised
Since Manager Inception
Annualised
Fund % 1.94% 3.83% N/A 5.06% 6.48%
Indicative Benchmark % 4.32% 4.98% N/A 4.78% 7.45%
Excess Return % -2.38% -1.15% N/A 0.28% -0.97%

Inception Date 15-Dec-2016

Manager Inception Date 31-Oct-2018

Indicative Benchmark: Bloomberg Barclays Global Aggregate Bond USD Hedged Index

Data as of  31-Oct-2020

Performance figures calculated in USD

  1 YR 3 YR
Annualised
5 YR
Annualised
Since Inception
Annualised
Fund % 1.86% 3.69% N/A 4.99%
Indicative Benchmark % 4.14% 5.12% N/A 4.89%
Excess Return % -2.28% -1.43% N/A 0.10%

Inception Date 15-Dec-2016

Indicative Benchmark: Bloomberg Barclays Global Aggregate Bond USD Hedged Index

Data as of  30-Sep-2020

Performance figures calculated in USD

Recent Performance

  Month to DateData as of 20-Nov-2020 Quarter to DateData as of 20-Nov-2020 Year to DateData as of 20-Nov-2020 1 MonthData as of 31-Oct-2020 3 MonthsData as of 31-Oct-2020
Fund % 1.98% 2.66% 2.49% 0.67% 1.25%
Indicative Benchmark % 0.52% 0.53% 5.21% 0.01% -0.35%
Excess Return % 1.46% 2.13% -2.72% 0.66% 1.60%

Inception Date 15-Dec-2016

Indicative Benchmark: Bloomberg Barclays Global Aggregate Bond USD Hedged Index

Indicative Benchmark: Bloomberg Barclays Global Aggregate Bond USD Hedged Index

Performance figures calculated in USD

Past performance is not a reliable indicator of future performance.  Source for fund performance: T. Rowe Price. Fund performance is calculated using the official NAV with dividends reinvested, if any. The value of an investment and any income from it can go down as well as up. Investors may get back less than the amount invested. It will be affected by changes in the exchange rate between the base currency of the fund and the subscription currency, if different. Sales charges (up to a maximum of 5% for the A Class), taxes and other locally applied costs have not been deducted and if applicable, they will reduce the performance figures. 

Where the base currency of the fund differs from the share class currency, exchange rate movements may affect returns.

31-Oct-2020 - Ken Orchard, Portfolio Manager ,
Global fixed income markets produced flat total returns in U.S. dollar-hedged terms. Tighter credit spreads, however, led to modestly positive excess returns. The DXY, a U.S. dollar currency index, returned 0.16%. The portfolio generated positive returns. Exposure to U.S. high yield corporate credit and global investment grade credit aided performance. Manageable issuance and positive flows created supportive technical conditions. However, concern that a spike in coronavirus infections could derail the global economic recovery along with uncertainty around the U.S. presidential election and the timing of further fiscal stimulus weighed on investor sentiment. Duration positioning contributed to returns. Short positioning U.S. Treasuries benefited as yields rose over the month. Long duration exposure in Serbia and Chile also benefited the portfolio. However, duration exposure in South Korea, a proxy for high-quality duration, detracted slightly as rates increased.

Holdings

Issuers

Top
Issuers
10
Top 10 Issuers 20.92% Was (30-Sep-2020) 20.62%
Other View Top 10 Issuers

Monthly data as of 31-Oct-2020

Holdings

Total
Holdings
381
Largest Holding U.S. Treasury Inflation Indexed Bonds 3.32% Was (30-Jun-2020) 3.00%
Top 10 Holdings 14.91%
Other View Full Holdings Quarterly data as of 30-Sep-2020

Quality Rating View quality analysis

  Largest Overweight Largest Underweight
Quality Rating BB US Government Agency Securities
By % 17.94% -10.48%
Fund 18.25% 0.00%
Indicative Benchmark 0.31% 10.48%

Average Credit Quality

BBB

Monthly Data as of 31-Oct-2020
Indicative Benchmark:  Bloomberg Barclays Global Aggregate Bond USD Hedged Index

Sources for Credit Quality Diversification: Moody's Investors Service and Standard & Poor's (S&P) split ratings (i.e. BB/B and B/CCC) are assigned when the Moody's and S&P ratings differ. Short-Term holdings are not rated.

Maturity View maturity analysis

  Largest Overweight Largest Underweight
Maturity 0-1 Years 1-3 Years
By % 10.51% -11.93%
Fund 10.51% 10.73%
Indicative Benchmark 0.00% 22.66%

Weighted Average Maturity

5.81 Years

Monthly Data as of 31-Oct-2020
Indicative Benchmark:  Bloomberg Barclays Global Aggregate Bond USD Hedged Index

Duration View duration analysis

  Largest Overweight Largest Underweight
Duration Under 1 Year Over 10 Years
By % 15.40% -16.55%
Fund 17.82% 6.87%
Indicative Benchmark 2.42% 23.43%

Weighted Average Duration

4.09 Years

Monthly Data as of 31-Oct-2020
Indicative Benchmark:  Bloomberg Barclays Global Aggregate Bond USD Hedged Index

Sectors

Total
Sectors
7
Largest Sector Global Sovereign 34.78% Was (30-Sep-2020) 32.94%
Other View complete Sector Diversification

Monthly Data as of 31-Oct-2020

Indicative Benchmark: Bloomberg Barclays Global Aggregate Bond USD Hedged Index

Largest Overweight

Global High Yield
By17.11%
Fund 17.11%
Indicative Benchmark 0.00%

Largest Underweight

Global Sovereign
By-33.00%
Fund 34.78%
Indicative Benchmark 67.78%

Monthly Data as of 31-Oct-2020

31-Oct-2020 - Ken Orchard, Portfolio Manager ,
Sector positioning has been relatively unchanged over the past month. We made some small additions to taxable municipal bonds, though the pace has slowed as valuations moved closer to fair levels. We slightly increased overall risk in the portfolio going into the U.S. election. Notably, we removed some high yield credit protection.

Regions

Total
Regions
6
Largest Region North America 48.02% Was (30-Jun-2020) 41.70%
Other View complete Region Diversification

Monthly Data as of 30-Sep-2020

Indicative Benchmark: Bloomberg Barclays Global Aggregate Bond USD Hedged Index

Largest Overweight

Latin America
By10.32%
Fund 11.42%
Indicative Benchmark 1.09%

Largest Underweight

Japan
By-14.30%
Fund 0.48%
Indicative Benchmark 14.78%

Monthly Data as of 30-Sep-2020

Countries

Total
Countries
52
Largest Country United States 47.46% Was (30-Sep-2020) 47.08%
Other View complete Country Diversification

Monthly Data as of 31-Oct-2020

Indicative Benchmark: Bloomberg Barclays Global Aggregate Bond USD Hedged Index

Largest Overweight

United States
By11.13%
Fund 47.46%
Indicative Benchmark 36.33%

Largest Underweight

Japan
By-14.19%
Fund 0.48%
Indicative Benchmark 14.67%

Monthly Data as of 31-Oct-2020

31-Oct-2020 - Ken Orchard, Portfolio Manager ,
We marginally trimmed duration exposure in Italy as valuations began to richen. Italy remains a significant position in the portfolio, be we trimmed to take gains and reduce risk. Also, we increased our U.S. duration exposure as yields increased during the month.

Currency

Total
Currencies
23
Largest Currency U.S. dollar 95.11% Was (30-Sep-2020) 94.98%
Other View complete Currency Diversification

Monthly Data as of 31-Oct-2020

Indicative Benchmark : Bloomberg Barclays Global Aggregate Bond USD Hedged Index

Largest Overweight

U.S. dollar
By 53.19%
Fund 95.11%
Indicative Benchmark 41.92%

Largest Underweight

euro
By -25.57%
Fund -1.64%
Indicative Benchmark 23.93%

Monthly Data as of 31-Oct-2020

31-Oct-2020 - Ken Orchard, Portfolio Manager ,
We rotated exposure away from the South African rand (ZAR) into the Russian ruble (RUB). The RUB has unperformed other emerging markets currencies recently, and offers attractive value compared with the ZAR as South Africa may be facing budget issues.

Team (As of 01-Oct-2020)

Kenneth A.  Orchard

Kenneth Orchard is a senior portfolio manager in the Fixed Income Division and a member of the Global Fixed Income Investment team. He is a vice president of T. Rowe Price Group, Inc., and T. Rowe Price International Ltd.

Kenneth’s investment experience began in 2003, and he has been with T. Rowe Price since 2010, beginning in the Fixed Income Division, with responsibility for cochairing the Fixed Income Sector Strategy Advisory Group. He is the portfolio manager for the Global Multi-Sector Bond and Diversified Income Bond Strategies and co-portfolio manager for the International Bond Strategies. Prior to this, Kenneth was employed by Moody’s Investors Service in the area of sovereign rating methodology. Before that, Kenneth was employed by Emerging Market Economics as a consulting senior economist. Kenneth also was employed by HSBC Asset Management as an assistant portfolio manager. 

Kenneth earned a B.A. in international relations from the University of British Columbia and an M.Sc. in public financial policy from the London School of Economics. Kenneth also has earned the Chartered Financial Analyst® designation.

CFA® and Chartered Financial Analyst® are registered trademarks owned by CFA Institute.

  • Fund manager
    since
    2018
  • Years at
    T. Rowe Price
    10
  • Years investment
    experience
    17
Terry  A.  Moore

Terry Moore is a portfolio specialist in the Fixed Income Division of T. Rowe Price. He is a member of the Global Multi-Sector, Dynamic Global Bond, International Bond, and Customized Fixed Income Solutions teams, working closely with clients, consultants, and prospects. Mr. Moore is a vice president of T. Rowe Price Group, Inc.

Mr. Moore has 23 years of investment experience, nine of which have been at T. Rowe Price. Prior to joining the firm in 2009, he was a portfolio manager and principal with Smith Breeden Associates, where he managed a variety of fixed income portfolios with a focus on residential mortgage-backed securities. He also worked at Goldman Sachs & Co. trading asset-backed securities.

Mr. Moore earned a B.A. in economics and political science from the University of North Carolina at Chapel Hill and an M.B.A. from Duke University, The Fuqua School of Business, where he was a Fuqua Scholar. He also has earned the Chartered Financial Analyst designation.

  • Years at
    T. Rowe Price
    10
  • Years investment
    experience
    24

Fee Schedule

Share Class Minimum Initial Investment and Holding Amount (USD) Minimum Subsequent Investment (USD) Minimum Redemption Amount (USD) Sales Charge (up to) Investment Management Fee (up to) Ongoing Charges
Class A $1,000 $100 $100 5.00% 100 basis points 1.17%
Class I $2,500,000 $100,000 $0 0.00% 50 basis points 0.60%
Class Q $1,000 $100 $100 0.00% 50 basis points 0.67%

Please note that the Ongoing Charges figure is inclusive of the Investment Management Fee and is charged per annum.