Portfolio Managers Comment - April 2021 – Fixed Income – MAC AM CREDIT SELECT UCITS

Portfolio Managers Comment - April 2021 – Fixed Income – MAC AM CREDIT SELECT UCITS


Our Fixed Income management based on the primary market generated a performance of 0.67% in April, bringing the overall performance of the fund to 1.61 % since inception inception on January 04th, 2021).



As we explained in our previous comment, sovereign yields remained fairly high during the month of April. Inflationary fears linked to a too strong and too rapid recovery persist. The US 10-year rate notably evolved in a range around 1.5-1.7.

The new issues were busy in April with many names including Kedrion, Center Parcs, Rexel, Birkenstock... This sustained pace of issues has brought their number to more than 80 since the start of the year in the High Yield segment. We paid attention to the new bond issuances to remain active in the primary market.

Joe Biden continues his massive stimulus plans this time around with a new infrastructure plan. The American President intends in particular to finance his projects through an increase in taxes and massive bonds issues.

The IMF has also revised its global growth forecast upwards to 6% instead of 5.5%. The ECB, for its part, expects euro area GDP growth of 4% for 2021.

Central Banks did not surprise the markets with their announcements. Their speeches remain smooth, overwhelming and without major changes. However, they express uncertainties and pressures in the short term, but remain quite confident in the longer term. However, it is important to notify that the Fed will rely more on the progress of vaccination campaigns and the evolution of the global health situation in order to adapt its policy.

Despite many setbacks from suppliers such as AstraZeneca and Johnson & Johnson, vaccinations around the world are progressing at varying speed depending on the region. In Europe, the United Kingdom is a leader, and the situation has also greatly improved with an increase in cases limited to around 2,000 to 3,000 per day. The restrictions are gradually lifting in Europe and in the West more widely.

In emerging countries, the situation is more worrying, especially with India, which recorded around 7,000,000 new cases in at least April. Many European countries as well as the United States are mobilizing to help the government and the local populations. With regard to the situation of emerging countries, doubts arise as to their capacity to produce and consume in the short term. The situation remains to be carefully monitored.

The dollar depreciated against the euro throughout the month of April after seeing some rally in March. The dollar peaked at 1.21235 against the euro on April 29.

Despite a context that remains quite uncertain and undergoing numerous macroeconomic pressures, we were able to stay the course and provide a positive performance of 0.67% in April for our clients. Volatility remained stable at 1.79% reflecting our ability to adapt quickly and our careful stock selection. Unlike the first quarter of 2021, we slightly increased the duration2 of the portfolio, bringing it to 3.31 in order to take better advantage of the rebound in the bond markets. Finally, the EUR-USD exchange rate effect did not have an undue impact on us due to our low exposure to the currency during the month of April.

Benefit from this strategy

To benefit from this strategy in your investments, you can freely subscribe to our UCITS1 Fund started on January 04, 2021.

A UCITS Fund like ours offers a strict regulatory framework in terms of transparency as well as protection of capital and clients. The strategy analyzes the economic environment as a whole, identifies and adjudicates market opportunities on primary and secondary market with the aim of generating absolute performance uncorrelated from the markets.

EUR Share Class : LU2095273590

USD Share Class : LU2131342482

For more information, do not hesitate to visit the dedicated page or to contact us directly.

P: +44 (0)20 3750 9971

M: info@mac-am.co.uk

  1. Investment vehicle regulated for the purpose of investor protection, liquidity and transparency.
  2. Measure of exposure to interest rate risk




Image : https://unsplash.com/photos/7A15094rpp0 - Lucia Hatalova