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Invested in High Yield[[High Yield – Rating below BBB- (Standard & Poor’s Ratings Services), Baa3 (Moody’s Investors Service, Inc.) or equivalent for Fitch ratings.]] rated credit bonds[[Bonds are also a form of debt.]] whose issuers are domiciled in the OECD
countries and with an average duration of less than two years, Natixis Short Term
Global High Income Fund implements a non-benchmarked active management
strategy aimed at delivering superior performance and portfolio diversification over
a minimum recommended investment horizon of three years.
Sub-fund of the UCITS under Luxembourg law, Natixis International Funds (Lux) I[[Set up in 2013.]], Natixis
Short Term Global High Income Fund is aimed at all investors, both professional and nonprofessional.
Short Term High Yield bonds: an attractive asset class
Short term High Yield bonds are particularly attractive in the current environment:
– Historically they have proven less sensitive to interest rate rises and will be less volatile
than the credit market as a whole[[The figures mentioned are from previous years. Past performance is not a reliable indicator of future performance.]];
– They respond to the demand from clients subject to Solvency II, notably insurance
companies, who are seeking investments with a limited cost of capital;
– Over the long term, they offer lower volatility than High Yield across all maturities.
An innovative active management strategy focused on bond selection
Natixis Short Term Global High Income Fund benefits from a non-benchmarked active
management strategy without sector allocation combined with a 100% bottom up[[An investment process in which the micro aspects are generally more important than the macro factors (“top down”), i.e. in which each investment is made based on
the intrinsic qualities of a particular issuer.]] approach.
To deploy this strategy, the fund managers are supported by the expertise of the Natixis
Asset Management credit research team comprising 17 analysts based in Paris, London and
Des Moines (USA), headed by Sanda Molotcov, CFA. The research team focuses on identifying
the issuers with the most robust fundamentals and offering the most compelling risk-reward.
They pay particular attention to liquidity, solvency and the structure of the debt, together with
the business models of the issuers. This bond selection process is thus at the heart of the
fund’s alpha generation.
Optimum level of portfolio diversification
In addition to this bottom up[[An investment process in which the micro aspects are generally more important than the macro factors (“top down”), i.e. in which each investment is made based on
the intrinsic qualities of a particular issuer.]] selection process, the co-fund managers Nolwenn Le Roux, CFA,
and Vincent Marioni, SFAF, have established internal guidelines on the maximum number of
holdings by sector and by issuer to ensure an optimum level of portfolio diversification. The
portfolio of Natixis Short Term Global High Income Fund thus holds 90 international issues as
of April 16, 2014.
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