Investment Objectives

The Fund aims to achieve a combination of income, with the possibility of capital growth by investing in a diversified portfolio of collective investment schemes.

The Investment Manager will invest in collective investment schemes including UCITS, ETFs that invest in a broad range of assets, including debt and equity securities.

We aim to build a diversified portfolio spread across several industries and sectors. The Fund is actively managed, not managed by reference to any index.

Investor Profile

A typical investor in the Income Strategy Fund is:

  • Seeking to earn a high level of regular Income
  • Seeking an actively managed & diversified investment primarily in income-yielding funds 

Fund Rules

  1. The fund may invest up to 40% of its assets in CISs that are permitted to invest 65% or more of their assets in money market instruments.
  2. The fund may invest up to 30% of its assets in CISs that are permitted to invest 65% or more of their assets in investment-grade bonds.
  3. The fund may invest up to 100% of its assets in CISs that are permitted to invest 65% or more of their assets in high yield bonds.
  4. The fund may invest up to 20% of its assets in CISs that are permitted to invest 65% or more of their assets in equity securities.

Commentary

March 2025

Introduction

The global macroeconomic environment underwent a notable shift in the first quarter of 2025. US exceptionalism came under pressure as heightened policy uncertainty triggered a sharp decline in sentiment, intensifying recession concerns. Meanwhile, a significant change in Germany’s fiscal policy improved the economic outlook across Europe, leading to a pronounced divergence in fixed income markets.

Germany held federal elections in February, with Friedrich Merz’s Christian Democratic Union (CDU) securing the largest share of votes. Merz expressed his intention to form a coalition government by Easter. In March, Germany’s parliament approved plans under the incoming Chancellor to relax the country’s borrowing restrictions, specifically exempting defence and security spending from strict debt limits. This move also enabled the launch of a €500 billion infrastructure fund to be deployed over the next 12 years. Consequently, German Bunds bore the brunt of the ensuing sell-off across the eurozone, with yields recording their largest daily jump since reunification in 1990 following the announcement (yields move inversely to price). There was a partial reversal of the market weakness towards the end of the quarter as focus turned to US “Liberation Day”, and thus the announcement of a broader swathe of tariffs.

Central bank policy action remained pivotal in Q1. The European Central Bank cut interest rates by a total of 50bps across its January and March meetings. Meanwhile, the Federal Reserve held the federal funds rate steady in March at 4.25-4.5%, maintaining the pause in its rate-cutting cycle that began in January. Fed Chair Jerome Powell acknowledged growing uncertainty in the economic outlook but reiterated expectations of approximately 50bps in rate reductions over the course of the year.

US Treasuries outperformed during the quarter, with yields declining significantly (and prices rising) in response to weaker economic data. Divergence was also evident in corporate bond markets. Divergence was evident in corporate bond markets.  Credit delivered positive returns over the quarter, despite a risk-off tone in March that weighed especially on high-yield segments. Overall, US dollar-denominated bonds outpaced euro-denominated debt, with investment-grade returns at 2.36% versus 0.14%, and speculative-grade returns at 0.94% versus 0.64%.

Market environment and performance

The US economy exhibited signs of emerging growth concerns, driven by potential tariff impacts and persistent inflationary pressures. Leading indicators, following a sharp decline in February rebounded at quarter-end, with March’s Composite PMI noting solid growth (53.5 v a previous month reading of 51.6) in the US private sector, largely driven by a pickup in services activity as manufacturing output declined. Meanwhile, concerns over the impact of federal government policies, especially in relation to tariffs, caused sentiment to fall to its second-lowest level since the end of 2022.

On the inflation front, concerns eased as both headline and core inflation declined more than expected in February. Headline inflation dropped to 2.8% from 3%, coming in below forecasts. Core inflation, which excludes volatile components such as energy, food, alcohol, and tobacco, also fell to 3.1% from 3.3% the previous month. Despite some signs of softening, the labour market remained resilient. Job growth exceeded expectations, although the unemployment rate edged up slightly to 4.2%. Critically, average hourly earnings rose by 3.8%, below forecasts of a 3.9% rise and February’s 4% advance.

In Europe, the economic outlook improved after stagnation in Q4 2024. PMI readings remained in expansionary territory since the start of the year. March’s Composite PMI edged up to 50.9 from 50.2 in January and February, pointing to a modest expansion across the euro area. Spain led the recovery with strong and accelerating business activity throughout the quarter. In Germany, March data signaled the strongest private sector expansion in ten months, as the manufacturing slump eased and production rose for the first time in nearly two years. France, however, remained an outlier, recording a seventh consecutive month of contraction in private sector activity.

On the price front, inflation continued to decline, reinforcing confidence that the disinflation process is on track and converging toward the ECB’s medium-term target of 2%. In March, annual inflation fell to 2.2%, the lowest level since November 2024. Services inflation also eased to a 33-month low, falling to 3.4% from 3.7% in February. The labour market, remained healthy, with the unemployment rate revolving at notable lows (6.1% in February), and significantly below the 20-year average.

Fund performance

Performance for the month of March proved negative, noting a 0.68% loss for the CC Income Strategy Fund – in line with the moves witnessed across high-yield credit markets during such period.

Market and investment outlook

The credit market narrative at the start of the year remained largely unchanged, with investor attention focused on the dynamic political landscape, central bank policies, and economic data.

Economic indicators, both leading and lagging, continue to emphasize a regional divergence. The US, despite the Federal Reserve’s “higher for longer” stance, continues to demonstrate resilient broad-based strength, underpinned by a robust labour market that has thus far supported consumer spending. Meanwhile, Europe has displayed early signs of a pickup in growth following stagnation in Q4 2024, with private sector activity remaining in expansionary territory throughout the first quarter.

In credit markets, the interplay between a resilient US labour market and ongoing inflationary pressures supports a cautious, neutral approach to duration, particularly given the continued uncertainty surrounding the yield curve’s direction. The imposition of new tariffs – exacerbated by the US’s Liberation Day measures – is expected to further cloud the economic outlook and add complexity to the yield curve’s path, as consumers grapple with rising prices and a resurgence in inflationary pressures.

We maintain our current preference, which leans towards European credit, underpinned by the prospects of continued monetary easing by the ECB. Nevertheless, the dynamic nature of the current environment, particularly the constantly evolving geopolitical tensions, require a highly proactive and adaptive management style to navigate potential risks and capitalize on emerging opportunities.

A quick introduction to our Global High Income Bond Fund

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Key Facts & Performance

Fund Manager

Jordan Portelli

Jordan is CIO at CC Finance Group. He has extensive experience in research and portfolio management with various institutions. Today he is responsible of the group’s investment strategy and manages credit and multi-asset strategies.

PRICE (EUR)

ASSET CLASS

Mixed

MIN. INITIAL INVESTMENT

€5000

FUND TYPE

UCITS

BASE CURRENCY

EUR

5 year performance*

0%

*View Performance History below
Inception Date: 15 Sep 2021
ISIN: MT7000030680
Bloomberg Ticker: CCPISAE MV
Distribution Yield (%): 3.47
Underlying Yield (%): -
Distribution: 31/05 and 30/11
Total Net Assets: 5.95 mn
Month end NAV in EUR: 92.40
Number of Holdings: 13
Auditors: Grant Thornton
Legal Advisor: GANADO Advocates
Custodian: Sparkasse Bank Malta p.l.c.

Performance To Date (EUR)

Top 10 Holdings

UBS (Lux) Bond Fund - Euro High Yield
19.6%
Nordea 1 - European High Yield Bond Fund
10.0%
CC Funds SICAV plc - High Income Bond Fund
9.9%
Robeco Capital Growth Funds - High Yield Bonds
9.6%
BlackRock Global High Yield Bond Fund
8.1%
Janus Henderson Horizon Global High Yield Bond Fund
7.8%
Fidelity Funds - European High Yield Bond Fund
7.8%
DWS Invest Euro High Yield Corp
7.8%
Schroder International Selection Fund Global High Yield
7.7%
AXA World Funds - Global High Yield Bonds
7.7%
Data for major sector breakdown is not available for this fund.
Data for maturity buckets is not available for this fund.
Data for credit ratings is not available for this fund.

Risk & Reward Profile

1
2
3
4
5
6
7
Lower Risk

Potentialy Lower Reward

Higher Risk

Potentialy Higher Reward

Top Holdings by Country

Europe
37.9%
Global
35.9%
International
25.0%

Asset Allocation

Fund 97.5%
ETF 1.3%
Cash 1.2%

Performance History (EUR)*

1 year

5.23%

3 year

7.46%

* The Distributor Share Class (Class A) was launched on 15 September 2021.
** Performance figures are calculated using the Value Added Monthly Index "VAMI" principle. The VAMI calculates the total return gained by aninvestor from reinvestment of any dividends and additional interest gained through compounding.
*** The Distributor Share Class (Class A) was launched on 15 September 2021.
**** Returns quoted net of TER. Entry and exit charges may reduce returns for investors.

Currency Allocation

Euro 100.0%
USD 0.0%
GBP 0.0%
Data for risk statistics is not available for this fund.

Interested in this product?

  • Investment Objectives

    The Fund aims to achieve a combination of income, with the possibility of capital growth by investing in a diversified portfolio of collective investment schemes.

    The Investment Manager will invest in collective investment schemes including UCITS, ETFs that invest in a broad range of assets, including debt and equity securities.

    We aim to build a diversified portfolio spread across several industries and sectors. The Fund is actively managed, not managed by reference to any index.

  • Investor profile

    A typical investor in the Income Strategy Fund is:

    • Seeking to earn a high level of regular Income
    • Seeking an actively managed & diversified investment primarily in income-yielding funds 
    Investor Profile Icon
  • Fund Rules

    The Investment Manager of the CC High Income Bond Funds – EUR and USD has the duty to ensure that the underlying investments of the funds are well diversified. According to the prospectus, the investment manager has to abide by a number of investment restrictions to safeguard the value of the assets

  • Commentary

    March 2025

    Introduction

    The global macroeconomic environment underwent a notable shift in the first quarter of 2025. US exceptionalism came under pressure as heightened policy uncertainty triggered a sharp decline in sentiment, intensifying recession concerns. Meanwhile, a significant change in Germany’s fiscal policy improved the economic outlook across Europe, leading to a pronounced divergence in fixed income markets.

    Germany held federal elections in February, with Friedrich Merz’s Christian Democratic Union (CDU) securing the largest share of votes. Merz expressed his intention to form a coalition government by Easter. In March, Germany’s parliament approved plans under the incoming Chancellor to relax the country’s borrowing restrictions, specifically exempting defence and security spending from strict debt limits. This move also enabled the launch of a €500 billion infrastructure fund to be deployed over the next 12 years. Consequently, German Bunds bore the brunt of the ensuing sell-off across the eurozone, with yields recording their largest daily jump since reunification in 1990 following the announcement (yields move inversely to price). There was a partial reversal of the market weakness towards the end of the quarter as focus turned to US “Liberation Day”, and thus the announcement of a broader swathe of tariffs.

    Central bank policy action remained pivotal in Q1. The European Central Bank cut interest rates by a total of 50bps across its January and March meetings. Meanwhile, the Federal Reserve held the federal funds rate steady in March at 4.25-4.5%, maintaining the pause in its rate-cutting cycle that began in January. Fed Chair Jerome Powell acknowledged growing uncertainty in the economic outlook but reiterated expectations of approximately 50bps in rate reductions over the course of the year.

    US Treasuries outperformed during the quarter, with yields declining significantly (and prices rising) in response to weaker economic data. Divergence was also evident in corporate bond markets. Divergence was evident in corporate bond markets.  Credit delivered positive returns over the quarter, despite a risk-off tone in March that weighed especially on high-yield segments. Overall, US dollar-denominated bonds outpaced euro-denominated debt, with investment-grade returns at 2.36% versus 0.14%, and speculative-grade returns at 0.94% versus 0.64%.

    Market environment and performance

    The US economy exhibited signs of emerging growth concerns, driven by potential tariff impacts and persistent inflationary pressures. Leading indicators, following a sharp decline in February rebounded at quarter-end, with March’s Composite PMI noting solid growth (53.5 v a previous month reading of 51.6) in the US private sector, largely driven by a pickup in services activity as manufacturing output declined. Meanwhile, concerns over the impact of federal government policies, especially in relation to tariffs, caused sentiment to fall to its second-lowest level since the end of 2022.

    On the inflation front, concerns eased as both headline and core inflation declined more than expected in February. Headline inflation dropped to 2.8% from 3%, coming in below forecasts. Core inflation, which excludes volatile components such as energy, food, alcohol, and tobacco, also fell to 3.1% from 3.3% the previous month. Despite some signs of softening, the labour market remained resilient. Job growth exceeded expectations, although the unemployment rate edged up slightly to 4.2%. Critically, average hourly earnings rose by 3.8%, below forecasts of a 3.9% rise and February’s 4% advance.

    In Europe, the economic outlook improved after stagnation in Q4 2024. PMI readings remained in expansionary territory since the start of the year. March’s Composite PMI edged up to 50.9 from 50.2 in January and February, pointing to a modest expansion across the euro area. Spain led the recovery with strong and accelerating business activity throughout the quarter. In Germany, March data signaled the strongest private sector expansion in ten months, as the manufacturing slump eased and production rose for the first time in nearly two years. France, however, remained an outlier, recording a seventh consecutive month of contraction in private sector activity.

    On the price front, inflation continued to decline, reinforcing confidence that the disinflation process is on track and converging toward the ECB’s medium-term target of 2%. In March, annual inflation fell to 2.2%, the lowest level since November 2024. Services inflation also eased to a 33-month low, falling to 3.4% from 3.7% in February. The labour market, remained healthy, with the unemployment rate revolving at notable lows (6.1% in February), and significantly below the 20-year average.

    Fund performance

    Performance for the month of March proved negative, noting a 0.68% loss for the CC Income Strategy Fund – in line with the moves witnessed across high-yield credit markets during such period.

    Market and investment outlook

    The credit market narrative at the start of the year remained largely unchanged, with investor attention focused on the dynamic political landscape, central bank policies, and economic data.

    Economic indicators, both leading and lagging, continue to emphasize a regional divergence. The US, despite the Federal Reserve’s “higher for longer” stance, continues to demonstrate resilient broad-based strength, underpinned by a robust labour market that has thus far supported consumer spending. Meanwhile, Europe has displayed early signs of a pickup in growth following stagnation in Q4 2024, with private sector activity remaining in expansionary territory throughout the first quarter.

    In credit markets, the interplay between a resilient US labour market and ongoing inflationary pressures supports a cautious, neutral approach to duration, particularly given the continued uncertainty surrounding the yield curve’s direction. The imposition of new tariffs – exacerbated by the US’s Liberation Day measures – is expected to further cloud the economic outlook and add complexity to the yield curve’s path, as consumers grapple with rising prices and a resurgence in inflationary pressures.

    We maintain our current preference, which leans towards European credit, underpinned by the prospects of continued monetary easing by the ECB. Nevertheless, the dynamic nature of the current environment, particularly the constantly evolving geopolitical tensions, require a highly proactive and adaptive management style to navigate potential risks and capitalize on emerging opportunities.

  • Key facts & performance

    Fund Manager

    Jordan Portelli

    Jordan is CIO at CC Finance Group. He has extensive experience in research and portfolio management with various institutions. Today he is responsible of the group’s investment strategy and manages credit and multi-asset strategies.

    PRICE (EUR)

    ASSET CLASS

    Mixed

    MIN. INITIAL INVESTMENT

    €5000

    FUND TYPE

    UCITS

    BASE CURRENCY

    EUR

    5 year performance*

    0%

    *View Performance History below
    Inception Date: 15 Sep 2021
    ISIN: MT7000030680
    Bloomberg Ticker: CCPISAE MV
    Distribution Yield (%): 3.47
    Underlying Yield (%): -
    Distribution: 31/05 and 30/11
    Total Net Assets: 5.95 mn
    Month end NAV in EUR: 92.40
    Number of Holdings: 13
    Auditors: Grant Thornton
    Legal Advisor: GANADO Advocates
    Custodian: Sparkasse Bank Malta p.l.c.

    Performance To Date (EUR)

    Risk & Reward Profile

    1
    2
    3
    4
    5
    6
    7
    Lower Risk

    Potentialy Lower Reward

    Higher Risk

    Potentialy Higher Reward

    Top 10 Holdings

    UBS (Lux) Bond Fund - Euro High Yield
    19.6%
    Nordea 1 - European High Yield Bond Fund
    10.0%
    CC Funds SICAV plc - High Income Bond Fund
    9.9%
    Robeco Capital Growth Funds - High Yield Bonds
    9.6%
    BlackRock Global High Yield Bond Fund
    8.1%
    Janus Henderson Horizon Global High Yield Bond Fund
    7.8%
    Fidelity Funds - European High Yield Bond Fund
    7.8%
    DWS Invest Euro High Yield Corp
    7.8%
    Schroder International Selection Fund Global High Yield
    7.7%
    AXA World Funds - Global High Yield Bonds
    7.7%

    Top Holdings by Country

    Europe
    37.9%
    Global
    35.9%
    International
    25.0%

    Asset Allocation

    Fund 97.5%
    ETF 1.3%
    Cash 1.2%

    Performance History (EUR)*

    1 year

    5.23%

    3 year

    7.46%

    * The Distributor Share Class (Class A) was launched on 15 September 2021.
    ** Performance figures are calculated using the Value Added Monthly Index "VAMI" principle. The VAMI calculates the total return gained by aninvestor from reinvestment of any dividends and additional interest gained through compounding.
    *** The Distributor Share Class (Class A) was launched on 15 September 2021.
    **** Returns quoted net of TER. Entry and exit charges may reduce returns for investors.

    Currency Allocation

    Euro 100.0%
    USD 0.0%
    GBP 0.0%
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