SICAV

Euro Corporate Bond Fund

A diversified investment grade corporate fund with a focus on security selection.

ISIN LU0133091248 WKN 767364

3YR Return Annualised
(View Total Returns)

Total Assets
(EUR)

1.95%
€251.0m

1YR Return
(View Total Returns)

Manager Tenure

0.29%
16yrs

Information Ratio
(5 Years)

Tracking Error
(5 Years)

0.25
0.97%

Inception Date 05-Feb-2002

Performance figures calculated in EUR

Other Literature

30-Jun-2020 - David Stanley, Portfolio Manager,
We believe the medium-term outlook remains favourable. Recent economic data has been encouraging and unprecedented monetary and fiscal support from global policymakers should keep the technical backdrop strong. However, the market remains susceptible to bouts of volatility should coronavirus cases continue to escalate in the U.S. Valuations are less attractive across the board following the recent spread tightening, so bottom-up security selection and a medium- to long-term perspective will be important to achieving sustained performance.
David Stanley
David Stanley, Portfolio Manager

David Stanley is a portfolio manager in the Fixed Income Division at T. Rowe Price, responsible for European corporate bond selection. Mr. Stanley 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 corporate bonds that are denominated in euro.

Investment Approach

  • Focus primarily on corporate bonds denominated in euros.
  • Integrate proprietary credit and capital markets research to identify market inefficiencies.
  • Add value primarily through individual security selection, sector rotation and term-structure positioning.
  • Credit research is the most important element of our corporate bond process and includes credit analysis and relative value assessment.
  • Risk management is central to our process with diversification by issuer and industry the most important elements in our approach to risk management.

Portfolio Construction

  • Fully hedged back to euro
  • Duration is maintained within a range of +/- 0.25 of a year from the benchmark
  • Diversified sector exposure
  • Maximum 3% overweight per issuer
  • Maximum of 20% of the portfolio can be invested in non-investment grade issues
  • Average tracking error expected to range between 100 and 150 bps per annum

Performance (Class I)

Annualised Performance

  1 YR 3 YR
Annualised
5 YR
Annualised
10 YR
Annualised
Fund % 0.29% 1.95% 2.59% 4.02%
Indicative Benchmark % -0.42% 1.80% 2.35% 3.65%
Excess Return % 0.71% 0.15% 0.24% 0.37%

Inception Date 05-Feb-2002

Indicative Benchmark: Bloomberg Barclays Euro-Aggregate: Corporates Bond Index EUR

Data as of  30-Jun-2020

Performance figures calculated in EUR

  1 YR 3 YR
Annualised
5 YR
Annualised
10 YR
Annualised
Fund % 0.29% 1.95% 2.59% 4.02%
Indicative Benchmark % -0.42% 1.80% 2.35% 3.65%
Excess Return % 0.71% 0.15% 0.24% 0.37%

Inception Date 05-Feb-2002

Indicative Benchmark: Bloomberg Barclays Euro-Aggregate: Corporates Bond Index EUR

Data as of  30-Jun-2020

Performance figures calculated in EUR

Recent Performance

  Month to DateData as of 07-Aug-2020 Quarter to DateData as of 07-Aug-2020 Year to DateData as of 07-Aug-2020 1 MonthData as of 30-Jun-2020 3 MonthsData as of 30-Jun-2020
Fund % 0.28% 1.72% 0.42% 2.09% 5.96%
Indicative Benchmark % 0.13% 1.64% 0.42% 1.32% 5.28%
Excess Return % 0.15% 0.08% 0.00% 0.77% 0.68%

Inception Date 05-Feb-2002

Indicative Benchmark: Bloomberg Barclays Euro-Aggregate: Corporates Bond Index EUR

Indicative Benchmark: Bloomberg Barclays Euro-Aggregate: Corporates Bond Index EUR

Performance figures calculated in EUR

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.

30-Jun-2020 - David Stanley, Portfolio Manager,
European corporate bond markets posted a positive return in June. Spreads ended tighter, largely on the back of a strong rally early in the month amid central bank and government stimulus and positive surprises in the economic data. However, rising numbers of coronavirus infections in the U.S. weighed on sentiment as the month progressed, causing spreads to retrace some of their earlier gains. Within the portfolio, security selection drove relative gains, with our holdings in both the industrials and financials sectors making strong contributions, as names that were hit hardest during the first quarter sell-off continued to recover. Some of our exposures to commodity sectors were among the top performers. A range of financial sector names from both core and peripheral Europe also helped. Our asset allocation by industry sector had a neutral impact over the month. However, our defensive protection positions weighed on gains amid the favourable market backdrop.

Holdings

Issuers

Top
Issuers
10
Top 10 Issuers 16.27% Was (31-May-2020) 16.76%
Other View Top 10 Issuers

Monthly data as of 30-Jun-2020

Holdings

Total
Holdings
234
Largest Holding Bunge Finance Europe BV 1.21% Was (31-Mar-2020) 1.36%
Top 10 Holdings 10.58%
Other View Full Holdings Quarterly data as of 30-Jun-2020

Quality Rating View quality analysis

  Largest Overweight Largest Underweight
Quality Rating BBB A
By % 15.74% -23.46%
Fund 66.47% 14.15%
Indicative Benchmark 50.73% 37.61%

Average Credit Quality

N/A

Monthly Data as of 30-Jun-2020
Indicative Benchmark:  Bloomberg Barclays Euro-Aggregate: Corporates Bond Index EUR

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
Maturity 3-5 Years
By % 22.59%
Fund 22.59%
Indicative Benchmark 0.00%

Weighted Average Maturity

5.44 Years

Monthly Data as of 30-Jun-2020
Indicative Benchmark:  Bloomberg Barclays Euro-Aggregate: Corporates Bond Index EUR

Duration View duration analysis

  Largest Overweight Largest Underweight
Duration Under 1 Year 1-3 Years
By % 7.76% -7.43%
Fund 8.09% 17.80%
Indicative Benchmark 0.33% 25.22%

Weighted Average Duration

N/A

Monthly Data as of 30-Jun-2020
Indicative Benchmark:  Bloomberg Barclays Euro-Aggregate: Corporates Bond Index EUR

Countries

Total
Countries
29
Largest Country Germany 11.88% Was (31-May-2020) 10.67%
Other View complete Country Diversification

Monthly Data as of 30-Jun-2020

Indicative Benchmark: Bloomberg Barclays Euro-Aggregate: Corporates Bond Index EUR

Largest Overweight

Italy
By5.80%
Fund 9.88%
Indicative Benchmark 4.08%

Largest Underweight

France
By-13.34%
Fund 8.18%
Indicative Benchmark 21.52%

Monthly Data as of 30-Jun-2020

30-Apr-2017 - David Stanley, Portfolio Manager,
We maintain underweight allocations to France, and Germany in favour of overweight positions in the Spain and Italy.

Team (As of 05-Aug-2020)

David Stanley

David Stanley is a portfolio manager in the Fixed Income Division at T. Rowe Price, responsible for European corporate bond selection. Mr. Stanley is a vice president of T. Rowe Price Group, Inc. and T. Rowe Price International Ltd.

Mr. Stanley has 32 years of investment experience, 16 of which have been at T. Rowe Price. Prior to joining the London team in 2003, he was employed by Bank of America Capital Management, where he was a director and portfolio manager responsible for the analysis of international corporate bonds and cash investments. Prior to working for Bank of America, Mr. Stanley was employed for eight years in Morgan Stanley Asset Management's London office, where he served as a fixed income fund manager responsible for international corporate bonds.

Mr. Stanley earned a B.A. in economics and social studies from the University of Manchester.

  • Fund manager
    since
    2003
  • Years at
    T. Rowe Price
    16
  • Years investment
    experience
    32

Fee Schedule

Share Class Minimum Initial Investment and Holding Amount (EUR) Minimum Subsequent Investment (EUR) Minimum Redemption Amount (EUR) Sales Charge (up to) Investment Management Fee (up to) Ongoing Charges
Class A €1,000 €100 €100 5.00% 75 basis points 0.92%
Class I €2,500,000 €100,000 €0 0.00% 40 basis points 0.50%
Class Q €1,000 €100 €100 0.00% 40 basis points 0.57%
Class Sd €10,000,000 €0 €0 0.00% 0 basis points 0.10%

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

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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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