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CATEGORY: BONDS AND CONVERTIBLES
Data as per 06 November 2014
The document issued in German is legally binding. This
English translation is only for the purpose of convenience.
Flossbach von Storch Global Convertible Bond CHF-R
PAGE 1 OF 3
INVESTMENT STRATEGY
FUND DETAILS
Flossbach von Storch - Global Convertible Bond represents a defensive alternative to pure equity
investments. The convex profile of convertible bonds allows investors to take advantage of rising equity
prices whilst at the same time limiting downside risks.
Stock selection is based on a fundamental analysis process using in-house valuation models. If no
convertible bond is available for a promising underlying security, or its structure does not match the
required profile, the fund management may combine bonds and call options so as to present a similarly
attractive structure. Foreign currency risks are largely hedged. The fund invests globally in convertible
bonds.
Convertible bonds are fixed-income securities. In addition to a fixed coupon and the right to repayment
of the nominal value at maturity, they also attest the right to convert the invested capital into shares of
the issuing company (“convex profile”). Conversion must take place within a specified period which,
along with the exchange ratio, is defined before the start of the term. In the event of conversion, the
creditor becomes a co-owner of the company. From the company’s perspective, debt capital is
converted into equity capital.
ANNUAL PERFORMANCE (IN %)
Core data
WKN
A1W170
ISIN
LU0952573722
Domicile
Luxembourg
Share Class
CHF-R
Fund currency
EUR
Unit class currency
CHF
Launch date
01 October 2013
Financial year end
30 September
Income utilisation
Distribution
Authorised for
distribution
AT, CH, DE, LU
Current Data
8%
6.65
6%
4%
1.86
2%
1.07
Fund assets ¹
CHF 406.24 million
Redemption price
CHF 101.53
Costs ²
-2.99
-0.20
0%
-2 %
-4 %
01.10.13 – 06.11.13
06.11.13 – 06.11.14
Ongoing costs²
ca. 1.65 %
which includes a
management fee of
1.38 % p.a.
Performance fee
none
One-off costs
entry fee of up to 5.00 %
fund (net) in consideration with the maximum entry fee of 5 %
fund (gross)
Minimum investment
reference index: Thomson Reuters Global Convertible Hedged (IG) CHF
PERFORMANCE SINCE LAUNCH ON 01.10.2013 (IN %)
112 %
Minimum initial
investment
none
Minimum subsequent
investment
none
Addresses
108 %
Management company
106 %
104 %
102 %
Custodian bank /
Paying agent
DZ PRIVATBANK S.A.
4, rue Thomas Edison
1445 Strassen, Luxembourg
Representative in
Germany
Flossbach von Storch AG
Ottoplatz 1, 50679 Cologne
Germany
phone: +49.221.33.88-290
e-mail: [email protected]
www.fvsag.com/en/
investment-funds
Representative in
Switzerland
IPConcept (Schweiz) AG
In Gassen 6, 8022 Zurich,
Switzerland
Paying agent in
Switzerland
DZ PRIVATBANK (Schweiz) AG
Münsterhof 12
8022 Zurich, Switzerland
Paying agent in Austria
Erste Bank der oesterreichischen Sparkassen AG (Erste Bank
Oesterreich) Graben 21
1010 Vienna, Austria
100 %
98 %
96 %
Nov 13
Jan 14
Mar 14
May 14
Jul 14
Sep 14
Nov 14
fund (gross)
reference index: Thomson Reuters Global Convertible Hedged (IG) CHF
ACCUMULATED PERFORMANCE (GROSS, IN %)
2014 YTD
Fonds
reference
index
-0.25 %
1 year
-0.20 %
since launch (01.10.2013)
Flossbach von Storch Invest S.A.
6, Avenue Marie-Thérèse
2132 Luxembourg, Luxembourg
www.fvsinvest.lu
+1.66 %
¹ Conversion into the unit class currency is based on the exchange rate
on the day.
+5.87 %
+6.65 %
+7.80 %
Source: custodian bank and SIX Financial Information, status: 06.11.2014
² In addition to management fee, the fund is charged further costs such
as registrar and transfer agent fees, transaction costs, and various other
charges. Further information on ongoing and one-off costs can be
found in the sales prospectus, the most recent annual report, and the
key investor information.
³ Estimation because of launch
LEGAL NOTICE Gross fund performance (BVI method) takes into account all costs incurred at fund level (for example, management fees); net fund performance also takes into account the entry fee. Further costs may be charged individually at customer level, including custody fees, commission and other charges. Example calculation (net method): An investor wishes
to buy shares with capital of €1,000. Based on a maximum entry fee of 5%, €50 will be deducted from their investment as a
one-off initial charge. In addition, custody fees may be applied, which will further reduce the investor's return. The level of
generated by FactsheetsLIVE™ - www.factsheetslive.com
110 %
CATEGORY: BONDS AND CONVERTIBLES
Data as per 06 November 2014
Flossbach von Storch Global Convertible Bond CHF-R
TOP 10 POSITIONS (IN %)
PAGE 2 OF 3
KEY FUND FIGURES CONVERTIBLES
INVESTOR PROFILE
1.
2,000% GABRIEL FINANCE EVONIC
26.11.2016
3.17 %
average delta
43.04 %
2.
4,250% IMMOFINANZ 08.03.2018
3.09 %
average return
1.46 %
3.
1,500% IMMOFINANZ 11.09.2019
2.97 %
average remaining duration
5.37 years
4.
2,000% SALZGITTER 08.11.2017
2.77 %
duration
3.95 years
5.
6,500% TAG IMMOBILIEN 10.12.2015
2.54 %
6.
1,000% SIEM INDUSTR SUBSEA
12.09.2019
2.53 %
7.
5,500% TAG IMMOBILIEN 28.06.2019
2.39 %
8.
1,750% DP WORLD 19.06.2024
2.28 %
9.
4,500% REXLOT 17.04.2019
2.28 %
10.
2,125% AZIMUT HOLDING 25.11.2020
2.27 %
Source: custodian bank and Flossbach von Storch, status: 30.09.2014
Total
Long-term: over 5 years
OPPORTUNITIES
MORE FUNDS DATA
2.49 %
26.29 %
Source: custodian bank, status: 30.09.2014
TOP REGIONS CONVERTIBLES (IN %)
Income-oriented, tendency towards growth: your
return expectations are above the normal rate of
return. This means you tolerate higher price volatility arising from potential fluctuations in stock markets, interest rates and currencies and accept the
risk of moderate loss.
INVESTMENT HORIZON:
There are currently 96 securities in the
portfolio.
Cash
RISK APPETITE:
Source: custodian bank and Flossbach von Storch, status: 30.09.2014
+ Investing in funds can deliver an attractive result at a lower level of risk compared to a direct
investment in equities.
+ Income can be generated from regular interest
payments.
+ Convertible bonds can increase in value when
equity markets rise.
TOP 10 SECTORS CONVERTIBLES (IN %)
1.
Europe
64.83 %
1.
Real Estate
15.03 %
2.
North America
12.67 %
2.
Basic Materials
12.50 %
3.
Asia ex Japan
12.08 %
3.
Non-cyclical Consumer
9.42 %
4.
Japan
5.55 %
4.
Cyclical Consumer
8.17 %
5.
Near East
3.53 %
5.
Energy
8.11 %
6.
Australia
0.81 %
6.
Banking / Finance
7.62 %
7.
Latin America
0.54 %
7.
Technology
7.34 %
8.
Telecom / Media
6.25 %
9.
Capital Goods
5.89 %
10.
Other
5.61 %
+ Derivatives can be used to increase potential
yields.
+ Investing in assets denominated in a foreign
currency can have a positive impact on unit values as a result of exchange rate movements
RISKS
Source: custodian bank and Flossbach von Storch, status:
30.09.2014
Source: custodian bank and Flossbach von Storch, status:
30.09.2014
MONTHLY COMMENTARY
While the S&P Index fell by 1.6%, the Euro Stoxx 50 and the Nikkei 225 both rose: by 1.7% and 4.9% respectively. The markets were depressed by investor worries that the global economy might slow down. Once
again, weaker growth in China was in the spotlight – but the markets were supported by the central
banks’ monetary policies, which remained relaxed. The euro fell further against the dollar at the beginning of the month after the European Central Bank (ECB) cut its key rate once more and held out the prospect of additional supporting measures. Yields on ten-year German government bonds remained below
the one-percent mark.
The global convertible bond index fell by 2.3%. This decline, disproportionately heavy in comparison with
the performance of the equity market, led to a marked fall in convertible bond valuations. During the
month under review, the fund participated in new issues from the BW Group, SAF Holland,
Immofinanz/Buwog, EON/BKW, BKW and Gunma. Its holdings in Ship Finance, Tibco Software, Qihoo 360
Technologies, Pacific Basin and LEG Immobilien, conversely, were reduced.
- Investing in convertible bonds may entail price
risks, especially in the case of rising interest rates on the capital markets.
- Convertible bonds can decline in value when
equity markets fall. Country, credit and issuer liquidity risk. Also potential exchange rate risks. If
securities are illiquid (i.e. thinly traded), there is
a risk that it may either not be possible to sell
the assets at all or only by accepting a significant discount on the sale price.
- Where used, derivatives can have a greater negative impact on the fund value than would be
the case if the assets were acquired directly.
This can affect the fund’s risk profile and volatility (tendency for the price to fluctuate).
- The straight concentration on special markets
can have a negative impact because of the dependent performance of these selected markets.
- Investing in assets denominated in a foreign
currency can have a positive impact on unit values as a result of exchange rate movements.
For detailed information on opportunities and risks,
please refer to the sales prospectus.
CATEGORY: BONDS AND CONVERTIBLES
Data as per 06 November 2014
Flossbach von Storch Global Convertible Bond CHF-R
FUND MANAGER
PAGE 3 OF 3
DISCLAIMER
Thorsten Vetter
» Senior Portfolio Manager at Flossbach von Storch since 2005 (from 2000 to 2005
Portfolio Manager and Analyst)
» Porfolio manager and analyst at Krombacher Brauerei in Krombach (1997 – 2000)
» Obtained a degree in Business Studies in Giessen (1992 – 1997)
HOW WE SEE THE WORLD
Central banks in industrialised nations will keep interest rates at an all-time low for some time to come,
as this is the only way they can fund their debt-laden budgets. Furthermore, the weak growth levels
among national economies do not justify significantly higher interest rates.
The euro crisis is not over - it is simply taking a break. Two major economies – France and Italy – are both
suffering from chronically weak growth. It is uncertain whether the European Central Bank will succeed in
boosting lending in the peripheral members of the euro area, thereby stimulating growth.
Japan has become a “financial testing ground” for innovative state funding. The Bank of Japan is already
buying government bonds in large quantities in a bid to keep interest rates low, thus reducing the state’s
funding costs.
Even though the U.S. Federal Reserve has reversed its policy of purchasing bonds, this does not indicate a
general change in the fairly relaxed monetary policy pursued by the U.S.
Although bonds bring some stability to asset growth, they offer only marginal yields. However, an active
investment approach can improve yield potential.
Top-quality, high-dividend stocks are an important component when it comes to achieving regular income and maintaining asset values in this low interest environment.
Gold is and will remain the currency of last resort. Once investors finally realise that there is no longer a
regulated way out of the policy of cheap money, this strategic reason for holding this precious metal will
gain traction once again.
One of the purposes of this document is to serve as advertising material.
This document does not constitute an offer to sell,
purchase or subscribe to securities or other assets. The information and estimates contained herein do not constitute investment advice or any other form of recommendation. Detailed information about the fund(s) can be
found in the sales prospectus as well as in the articles of
association, management regulations or contract conditions, in conjunction with the latest respective audited annual report and semi-annual report, if the latter is published later than the most recent annual report. These documents form the sole binding basis for any purchase. The
said documents and the Key Investor Information are
available free of charge in German from the respective
management company/investment company or the custodian/depositary or from agents in those countries where the funds have been licensed for distribution.
The information contained and opinions expressed in this
document reflect the views of Flossbach von Storch at the
time of publication and are subject to change without prior notice. Forward-looking statements reflect the judgement and future expectations of Flossbach von Storch. Actual performance and results may, however, differ materially from such expectations. All information has been
compiled with care. However, no guarantee is given as to
the accuracy and completeness of information and no liability is accepted. The value of any investment can fall as
well as rise and you may not recoup the amount you invested. In connection with the brokerage of fund
units/shares, Flossbach von Storch and/or its distribution
partners may receive reimbursements from costs charged
to the fund by the management company/investment
company in accordance with the relevant sales prospectus. The tax treatment of the investment depends on the
investor’s personal circumstances and may be subject to
change. Further information about taxation can be found
in the sales prospectus.
The units/shares issued by this fund may only be offered
for purchase or sold in jurisdictions in which such offer or
sale is permitted. Accordingly, the units/shares of this fund
may not be offered for purchase or sold neither within the
USA nor to or for the account of US citizens or US persons
domiciled in the USA. Additionally, the units/shares issued
by this fund may not be offered for purchase or sold to
“US-Persons” and/or entities, which are owned by one or
more “US-Persons” based on the definitions set out in the
“Foreign Account Tax Compliance Act (FATCA)”. This document and the information contained herein may not be
distributed in the USA. The distribution and publication of
this document as well as the offer or sale of the fund’s
units/shares may also be subject to restrictions in other jurisdictions.
The latest net asset value (NAV) of the fund can be obtained from the management company/investment company’s website.
© 2014 Copyright Flossbach von Storch.
All rights reserved.