Independent credit analysis
The objective of our EM Bond Opp. 2024 fund is simple and clear, in line with the Anaxis investment philosophy. It is to allow our clients to benefit from the extra return offered by emerging market corporate bonds while limiting the volatility risk specific to this asset class. We also aim to bring diversification to our clients’ bond portfolios, through a robust and distinctive allocation in this segment that sets us apart from other emerging market debt funds.
To achieve this, we combine fundamental and independent credit analysis, the true DNA of Anaxis, with a strict and ambitious ESG policy. The result is a well-diversified portfolio of more than 100 issuers at any given time, with a primary focus on companies that operate in resilient sectors and have an intrinsic ability to generate significant cash flow. Moreover, Anaxis’s ambitious commitment to energy transition and sustainable development criteria now forms an integral part of our investment policy. We consider this to be a driver of differentiation, risk control and performance.
Overweighting resilient sectors
The main difference between our EM 2024 fund and others in the same category becomes clear when we compare its sector allocation with the emerging market debt investment universe. Firstly, the sectors that are traditionally the most resilient and most likely to achieve stable performance over time are over-represented in our EM 2024 fund. These include telecommunications, healthcare, utilities and consumer staples.
Conversely, almost 50% of the universe is either very heavily underweight or completely absent from our portfolio. Examples include fossil fuel producers and companies in the polluting chemicals sector, which are completely excluded from our portfolio for ESG reasons. At the same time, the financial and real estate sectors are also excluded for reasons of excessive leverage and performance cyclicality. This sector-specific positioning we offer our clients allows us to create a product that is both robust and attractive in terms of yield.
At the end of February, our EM 2024 portfolio offers investors an average yield in dollars of 5.24%. The duration is limited, at 2.75 years, and the portfolio is well-diversified, with around 130 different issuers. The average position is 0.66%.
