In this period of low interest rates, the search for yield is put to the test, Perpetual Subordinated Bonds thus present an effective response to current challenges, while maintaining a defensive profile.
Following the Basel agreements in 2014, the bond market observed a resurgence of Perpetual Subordinated Bonds, this asset class allowing companies to take advantage of an accounting boon by increasing their equity, and thus cleaning up their ratios.
It is in this more than promising segment that the Quilvest Credit Sub fund strategy, initiated in June 2015, comes into play. This strategy is based on 3 pillars:
Unlike an overwhelming majority of the market, the Quilvest Credit Sub fund has a strong risk aversion. Indeed, the fund refuses any investment in financial companies, which, by definition, present a high debt, as well as a significant systemic risk because of the interdependence of these companies.
The subordination clause of perpetual bonds allows us to take advantage of a tremendous market opportunity, to offer our investors an attractive subordination premium of 143 bps for a YTW of 2.1%, while limiting the risks by investing in « Investment Grade » companies.
In this context, the I share (EUR) of the Quilvest Credit Sub fund posted at the end of November 2019, a performance of + 8.94% since the beginning of the year, and rose to the 1st decile Quantalys over 6 months, 1 year and 3 years old.
Please find the monthly file at the end of October by clicking here
Do not hesitate to contact us if you want more information.
Contact
Laurent Pluchard – Director of Development
Tel : +352 2469 77 642
Mob: +352 621 380 785
laurent.pluchard@dynasty-am.lu
Henri Rayot – Commercial Institutional Europe
Tel : +352 2469 77 644
Mob : +352 621 379 155
henri.rayot@dynasty-am.lu
Raphaël Lacam – Assistant Sales
Tel: +352 2469 77 648
raphael.lacam@dynasty-am.lu