Investment markets continue to be tested in this geopolitically driven environment. Heightened volatility and systemic risks are immediate threats along with the prospect of sustained low interest rates and a weak Australian dollar − creating uncertainty for investors. Add to this the coronavirus that is further challenging the macroeconomic outlook via demand and supply shocks.
In the late stages of this economic cycle, adding high grade bonds to your portfolio alongside other risky assets can help offset and get the balance right between risk and return – this is absolutely crucial now because of unknown risks, referring to risks inside assets that we don’t fully understand, as investors seek higher income.
One way to offset these risks is to hold some duration in AAA rated government bonds.
High grade sovereign bonds’ duration can help to offset riskier assets such as equities and high yield credit, helping to mitigate downside risk and providing negatively correlated returns for portfolios.
Tail risk hedging your portfolio using currency can also be used to potentially gain left tail protection. When combined with sovereign bonds and duration, it can potentially provide an enhanced outcome.
*Inception date is 25 February 2019. Performance is for the CC JCB Global Bond Fund, Class A (Hedged) and Class B (Unhedged), and is based on month end unit prices before tax in Australian Dollars. Net performance is calculated after management fees and operating costs, excluding taxation. This is historical performance data. It should be noted the value of an investment can rise and fall and past performance is not indicative of future performance.
The CC JCB Global Bond Fund provides investment exposure to a defensive allocation across G7 Governments and offers both currency hedged (Class A) and unhedged (Class B) classes, giving investors the flexibility to switch between $AUD hedged (to $USD), and $AUD unhedged, at no additional cost.
The Underlying Fund is managed by CIO, Charlie Jamieson and Deputy CIO Kate Samranvedhya, based in Singapore. Jamieson Coote Bonds currently has A$5 billion of assets under management for both institutional and retail investors. The Fund invests into the CC JCB Active International Bonds Segregated Portfolio (‘Underlying Fund’), which is a sub-fund of CC Global Access SPC incorporated as a Cayman Islands exempted segregated portfolio company.
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The Responsible Entity and issuer of units in the CC JCB Global Bond Fund ARSN 631 235 553 ('the Fund') is Channel Investment Management Limited ACN 163 234 240 AFSL 439007 (‘CIML’). The Fund invests into the CC JCB Active International Bonds Segregated Portfolio (‘Underlying Fund’), which is a sub-fund of CC Global Access SPC incorporated as a Cayman Islands exempted segregated portfolio company. CC Global Access The Investment Manager of the Underlying Fund is JamiesonCooteBonds Pty Ltd ACN 165 890 282 AFSL 459018 ('JCB'). is. Neither CIML nor JCB, their officers, or employees make any representations or warranties, express or implied as to the accuracy, reliability or completeness of the information contained in this report and nothing contained in this report is or shall be relied upon as a promise or representation, whether as to the past or the future. Past performance is not a reliable indication of future performance. This information is given in summary form and does not purport to be complete. This information has been prepared for the purposes of providing general information without taking into account any particular investment objectives, financial situation or needs. Before acting on any information you should consider the appropriateness of the information having regard to these matters, any relevant offer document and in particular, you should seek independent financial advice. The Responsible Entity has issued a product disclosure statement (‘PDS’) for the Fund dated February 2019 which contains important information and is available here. For further information and before investing, please read the PDS and any updated information.