December, 2020
The Principal Global Credit Opportunities Fund (the ‘Fund’) returned 1.00% (net) for the quarter, underperforming the Bloomberg Barclays Global Aggregate Corporate Index’s return of 2.61% by 1.61%. Underperformance during the quarter was led by sector allocation. Security selection also detracted from performance while curve positioning had a positive impact. Within sector allocation, underperformance was driven by an underweight allocation to investment grade corporate bonds. This was partially offset by an out-of-index allocation to below investment grade corporate bonds. Negative security selection was led by issuer specific performance within investment grade corporate bonds. This was partially offset by positive issuer specific performance within emerging market debt.
Positive curve positioning was due to an underweight position at the longend of the US Treasury curve as the curve steepened. Top performing issuers included MetLife, BAT Capital, and Aramco. During the quarter, the investment manager focused on owning shorter maturity US investment grade credit and corporate bonds in sectors that should continue to perform through a longer economic recovery (communications, technology, and pharmaceuticals) while avoiding more economically sensitive industries (energy and retail).
File: https://commentary.quantreports.net/wp-content/uploads/2021/02/164152882.pdfasset_class: Fixed Income
asset_category: Diversified Credit
peer_benchmark: Fixed Income - Diversified Credit Index
broad_market_index: Global Aggregate Hdg Index
manager_contact_details: Array
ticker: PGI0001AU
release_schedule: Quarterly
commentary_block: Array
factsheet_url:
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fund_features:
Principal Global Credit Opportunities The Fund aims to achieve a total return above the Barclays Global Aggregate Corporate Index (hedged to Australian dollars), before fees, over rolling three-year periods. The Fund invests in a diversified range of fixed income securities across a number of sectors.
structure: Managed Fund