Local Currency Bonds I EUR Acc

Emerging Markets

3.19 %

Per 04/10/24 16:29

LOW RISK

HIGH RISK

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ISIN

DK0060646636

Running approx.

0.62 %

Profile

The Structural Investment Case for EM Local Currency Bonds

  • Emerging market and Frontier countries generally belongs to the low or middle income parts of the World when measured on GDP per capita.

  • Because these countries typically have growing populations and lower capital bases compared to high income countries they tend to grow structurally higher causing their income to converge towards that of more developed countries.

  • The current low-yield environment in the developed world amplifies this structural effect. It creates a need for investor diversification that will support long-term demand for emerging debt assets.

  • Except for some notable exceptions, emerging market countries are generally fundamentally in good shape with falling levels of inflation, higher credit ratings and improved institutions such as independent central banks.

  • In the recent decade, the number of countries with sufficiently developed market structures to open up local currency based debt issues have increased. This gives rise to a new breed of local institutional investors that increase liquidity and offer states an opportunity to fund their budgets without the FX risk associated with USD or EUR denominated debt.

  • However, fragile institutions and unsustainable conduct of government can still cause risks to investors and it is therefore Sydinvest considers a significant amount of data on Environmental (E), Social (S) and governance (G) factors (ESG) when constructing the portfolios.

  • The emerging debt asset class has more than 18 trillion USD in market cap, but it still only count for approximately 20% of the world’s total GDP thus far below levels found in the developed markets. At the same time, roughly 70% or more of the World’s populations live in the 80 most common emerging market countries. Since only the countries with sufficient institutional strength can issue local currency debt, the case for market expansion and long-term investment opportunities are indeed vast and well founded.   


The Sydinvest EM funds and their advisor, the Sydbank EM Debt Team, can be explored in further detail on the eVestment database, a Nasdaq company, that provides a leading cloud-based data platform for institutional investors and their advisors.

On eVestment, Sydbank EM Debt present its leading emerging market strategies and investment capabilities together with other leading investment managers  thus allowing our clients a comprehensive global database to monitor our performance and stay informed.


The Profile for Sydinvest EM Local Currency Bonds

  • The fund invest in local currency sovereign bonds issued from emerging market and frontier countries. The objective is to provide investors with excess returns to the benchmark through active portfolio management.
     
  • The fund’s investment philosophy considers that a number of risk premiums emerge from the fundamental and structural case of emerging market convergence.
     
  • Most prominently, the lower level of human development and income cause institutional and market risks that increase the country risk premium. This premium can typically be expressed through inflation risk, trade and current account balance risk as well as government budget funding risk. A thorough evaluation of the growth and debt payment dynamics as well as the sustainability of government  is conducted to reveal such opportunities.
     
  • Secondly, the lower market cap of emerging debt issues creates liquidity premiums that can be revealed through a systematic relative value analysis across the investor base, the issuer characteristics and the issuer quality.
     
  • The ongoing dynamics of these risk premiums cause market prices to deviate from their long term fair values. It implies that each emerging market country carries a unique story and that active management is the only way for investors to unlock the value of these opportunities.
     
  • Sydinvest offers investors its decade-long experience of investing into hard and local currency emerging markets with an investment process built a small yet highly efficient and agile team.

    Explore the Sydinvest EM Investment Philosophy

    Study the details of the Investment Process

    Explore Sydinvest EM and the EM Debt Team on eVestment Analytics

The fund's investment profile

About the philosophy behind the fund

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Meet the team behind it

Those who manage your investment

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The practical

Which funds you can invest with

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Returns (according to costs)

Returns

Per 04/10/24 16:29

Today's Return +0.30 %

Return Sept: +2.82 %

Return YtD +3.19 %

NAV per. 04/10/24 16:29

Today's Return 0.30 %
Return year to date, % 3.19 %
Sell
Buy
NAV ultimo 1956.07
Total Assets (m) 2 EUR

Returns - Last Update 01/10/24

Return year to date, % 3.48 %
1 Year 7.97 %
3 Years 7.48 %
5 Years 3.34 %
7 Years 11.64 %
10 Years 18.96 %

NAV development

Export graph-data
Include:

Latest trends

Local Currency Bonds I EUR Acc Return September Return YtD
Latest trend 2.82 % 3.48 %
Return benchmark 2.55 % 3.87 %

Fund Holdings

Fund Holdings

Top 10 Holdings Coupon Country Base currency Proportion
Brazil Notas do Tesouro Nacional Serie 01.01.20299.76BrazilBRL5.92 %
Malaysia Government Bond 05.07.20343.83MalaysiaMYR4.90 %
Malaysia Government Bond 15.06.20283.73MalaysiaMYR4.69 %
South Africa Government Bond 31.01.20409.00South AfricaZAR3.73 %
Thailand Government Bond 20.06.20313.65ThailandTHB3.59 %
Brazil Notas do Tesouro Nacional Serie 01.01.20319.76BrazilBRL3.54 %
Indonesia 15.03.20348.38IndonesiaIDR3.47 %
Poland 25.07.20262.50PolandPLN3.33 %
Indonesia 15.05.20368.25IndonesiaIDR3.20 %
International Bank for Reconstruction & 17.04.20306.50SupraNationalINR3.02 %
Fund Holdings: 58
Show all

Distribution by country

Distribution by country

Country Proportion Change (%-Points)
Malaysia 11.54 % -0.87 %
South Africa 10.09 % 1.78 %
Indonesia 9.58 % -0.34 %
SupraNational 9.54 % 5.47 %
Brazil 9.46 % -2.10 %
Mexico 8.77 % -2.55 %
Thailand 7.81 % -2.87 %
Poland 6.17 % -0.33 %
Turkey 4.65 % 3.86 %
Other 22.39 % -1.09 %

Distribution by region

Region Proportion
Asia 37.39 %
Latin America 31.01 %
Eastern Europe 18.76 %
Africa 10.52 %
Caribbean 0.52 %
Other 1.80 %

Distrubution by currency

Base currency Proportion
Malaysian Ringgit (MYR) 11.43 %
Indonesian Rupiah (IDR) 10.58 %
South African rand (ZAR) 10.03 %
Mexican peso (MXN) 9.79 %
Brazilian real (BRL) 9.29 %
Polish zloty (PLN) 8.19 %
THB 7.70 %
INR 5.91 %
Turkish lira (TRL) 4.84 %
CZK 4.40 %
Other 17.85 %

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Risk

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Potentially higher rewards

Risk Scale

Placement of the fund on the scale is determined by the fluctuations of the funds NAV over the past five years.

Duration

Distribution by issuer

Distribution by issuer Proportion
Mortgage bonds 0.00 %
Government bonds 97.12 %
QUASI-soverreign 0.70 %
Company 1.34 %
Cash 0.84 %

Rating Distribution

Rating Distribution Proportion
BBB- og højere 48.82 %
BB- til BB+ 17.48 %
B+ eller lavere 32.86 %
Average rating BBB

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Fees and Expenses

Fees and Expenses

Fees and Expenses Running approx. Indirect Trade Cost Subscription Redemption
Local Currency Bonds I EUR Acc 0.62 % 0.33 % 0.31 % 0.31 %

Documents

Prospectus
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Central Information
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Key Information

Key Information per. 30/9-24

ISIN DK0060646636
Danish VP Code 6064663
Inception of Share Class 21.09.2015
Benchmark GBI-EM GLO Diversified unhedged/EUR
Listed No
Accumulated No
AGM (annual general meeting) 22.03.2024
Rec. investment horizon Min. 4 years
Portfolio Manager Sydbank EM Debt Team
Base currency EUR
Expected annual costs 0.62 %
Indirect Trade Cost 0.33 %
Share Class Assets (m) 2 EUR
Total Assets (m) 45 EUR
Denomination 1000
Tax rate 2023 1895.63 EUR
NAV ultimo September 2024 1961.54
Tax Rate -
Fund Holdings 58
Income type Capital income
Taxation Stock taxation
Dividend (2023) -
Year to Date 3.48 %
Deviation + (1 year) (per. 31/7-24) 4.48
Deviation + (3 years) (per. 31/7-24) 6.18
Sharpe Ratio (3 Years) (per. 31/7-24) -0.09
Yield to Maturity 7.68 %
Average Duration 5,64