April, 2021
The Fund aims to provide a return (before fees, costs and taxes) that exceeds the Bloomberg AusBond Composite 0+ Yr Index by 0.75% p.a. over rolling 3 year periods.
The Fund offers investors access to a diversified portfolio of fixed interest securities and seeks exposure to issuers that demonstrate leading environmental, social and corporate governance (ESG) and ethical practices while avoiding exposure to issuers with activities that we consider to negatively impact the environment or society
File: https://commentary.quantreports.net/wp-content/uploads/2021/01/171818964.pdfDecember, 2020
The Fund had a strong month in December outperforming the Bloomberg AusBond Composite Bond Index by 0.32% (pre-fee). The duration component was flat in December. Small gains in short end futures were offset by a drift higher in a long duration swap position in 5 years.
We continue to range trade front end around RBA Yield Curve Control but are wary of long ends as the strong risk on moves of recent times weigh on bonds The physical portfolio performed strongly outperforming the benchmark. Both the government sector positioning and the nongovernment sustainably screened portion of the portfolio performed very well. Industrials, financials, real estate, infrastructure and utilities sector positioning drove the performance.
Activity during the month included increasing exposure to one of our preferred sustainable semi-governments, the South Australian Government Financing Authority, this was funded out of cash. We look for ways to fund a more sustainable future whilst maintaining strong performance for our clients. An example of this in the portfolio is the Australian dollar KfW Green Bond. KfW is a development bank owned by the German government and helps finance a range of activities including housing and environmental projects in Europe as well as small and medium enterprises in developing countries. This bond funds green projects that aim for climate change mitigation through increased access and use of renewable energy and projects that increase energy efficiency.
Examples of projects supported by this bond include the construction of a wind park, solar farm and energy efficient housing in Germany. Historically, KfW Green Bonds have reduced and avoided emissions equivalent to the carbon sequestered by a forest 80% the size of the United Kingdom every year. Every AUD$1 million invested in this Green Bond is the equivalent of approximately 200 tonnes of CO2 avoided annually. This is like taking around 90 cars off the road per annum. These are the types of opportunities we seek to support with this fund.
File: https://commentary.quantreports.net/wp-content/uploads/2021/01/163695023.pdfticker: BTA0507AU
release_schedule: Monthly
commentary_block: Array
factsheet_url:
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manager_contact_details: Array
asset_class: Fixed Income
asset_category: Bonds - Australia
peer_benchmark: Fixed Income - Bonds - Australia Index
broad_market_index: Australian Bond Composite 0-10Y Index
structure: Managed Fund
fund_features:
Pendal Sustainable Australian Fixed Interest aims to provide a return (before fees, costs and taxes) that exceeds the Bloomberg AusBond Composite 0+ Yr Index by 0.75% p.a. over rolling 3 year periods. This Fund is designed for investors who want income, diversification across a broad range of fixed interest securities and are prepared to accept some variability of returns. The Fund may also hold cash and may use derivatives.
- Pendal’s investment process for fixed interest aims to add value through multiple strategies and investment research.
- Pendal seeks to generate excess returns through strategies including active security (including green bonds, social bonds and sustainable bonds) and sector selection, duration, yield curve and credit management.
- The Fund applies a sustainable and ethical assessment process to fixed interest credit issuers.
- Manager Address : Level 14, The Chifley Tower 2 Chifley Square, Sydney NSW 2000, Australia
- Phone : +612 9220 2000
- Website : https://www.pendalgroup.com/
- Contact Email : David.Higgins@pendalgroup.com
- Contact Page : https://www.pendalgroup.com/contact/media-enquiries/