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GIPS® Information

T. Rowe Price ("TRP") claims compliance with the Global Investment Performance Standards (GIPS®) and has prepared and presented this report in compliance with the GIPS standards. T. Rowe Price has been independently verified for the twenty four-year period ended June 30, 2020, by KPMG LLP. The verification report is available upon request. A firm that claims compliance with the GIPS standards must establish policies and procedures for complying with all the applicable requirements of the GIPS standards. Verification provides assurance on whether the firm’s policies and procedures related to composite and pooled fund maintenance, as well as the calculation, presentation, and distribution of performance, have been designed in compliance with the GIPS standards and have been implemented on a firm-wide basis. Verification does not provide assurance on the accuracy of any specific performance report.

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

Responsible Diversified Income Bond Fund

Formerly Diversified Income Bond Fund

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

ISIN LU1244139074 Bloomberg TRPGMSA:LX

3YR Return Annualised
(View Total Returns)

Total Assets
(USD)

4.78%
$129.8m

1YR Return
(View Total Returns)

Manager Tenure

0.57%
3yrs

Information Ratio
(5 Years)

Tracking Error
(5 Years)

0.12
5.47%

Inception Date 15-Dec-2016

Performance figures calculated in USD

31-Dec-2021 - Ken Orchard, Portfolio Manager,
The removal of liquidity and march toward a hiking cycle creates a challenging environment for risk assets such as credit in the near term. However, we believe that credit could outperform other asset classes until the latter stage of the rate hiking cycle, thus we are prepared to add during market pull-backs.
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
  • Environmental, social and governance ("ESG") factors with particular focus on those considered most likely to have a material impact on the performance of the holdings or potential holdings in the funds’ portfolio are assessed. These ESG factors, which are incorporated into the investment process alongside financials, valuation, macro-economics and other factors, are components of the investment decision. Consequently, ESG factors are not the sole driver of an investment decision but are instead one of several important inputs considered during investment analysis.

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

Regions

Total
Regions
5
Largest Region North America 54.86% Was (30-Sep-2021) 55.39%
Other View complete Region Diversification

Monthly Data as of 31-Dec-2021

Indicative Benchmark: Bloomberg Global Aggregate Bond USD Hedged Index

Largest Overweight

North America
By13.71%
Fund 54.86%
Indicative Benchmark 41.15%

Largest Underweight

Japan
By-13.26%
Fund 0.00%
Indicative Benchmark 13.26%

Monthly Data as of 31-Dec-2021

Countries

Total
Countries
55
Largest Country United States 53.39% Was (30-Nov-2021) 56.84%
Other View complete Country Diversification

Monthly Data as of 31-Dec-2021

Indicative Benchmark: Bloomberg Global Aggregate Bond USD Hedged Index

Largest Overweight

United States
By15.77%
Fund 53.39%
Indicative Benchmark 37.62%

Largest Underweight

Japan
By-13.26%
Fund 0.00%
Indicative Benchmark 13.26%

Monthly Data as of 31-Dec-2021

31-Dec-2021 - Ken Orchard, Portfolio Manager,
Total portfolio duration decreased, fuelled mostly by a reduction in the U.S. We reduced U.S. duration with Fed rate hike expectations moving forward and economic growth potentially continuing to rebound.
31-Dec-2021 - Ken Orchard, Portfolio Manager,
In currencies, we initiated long positions in the Polish zloty and added to our Hungarian forint long. The central banks for both countries are well into a rate hiking cycle that may be nearing its end. Additionally, we initiated a long position in the Chilean peso given its attractive carry and moved from a long position in the Russian rouble to a neutral posture.