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

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


Our Fixed Income management based on the primary market generated a performance of 0.22 % in June, bringing the net performance of the fund to 3.93% since inception inception on January 04th, 2021).



The month of August that is usually calm has been a bit hectic this year. Indeed, the indices suffered a little at the beginning of the month. The US employment figures were quite disappointing for the month of July, coming in at 330,000 new jobs instead of the 650,000 expected. Nonetheless, the July non-farm job creation publication was rather positive at 943,000.

Rates were quite volatile in August, the US 10-year rate stood at 1.31% against 1.24% at the end of July, the German 10-year at negative 0.385% against negative 0.462% at the end of July and the French 10-year at negative 0.032% against negative 0.107% at the end of July.

In China, the growth of industrial production and retail sales slowed more than expected during the month of July, reflecting a resurgence of cases and the implementation of restrictive measures in some parts of the country. A plan to tax the richest individuals in China has instilled fear among investors in the luxury segment weighing on securities exposed to this market.

Beyond China, an increase in cases in many countries is forcing governments to adopt further restrictive measures, thus pushing back the prospect of a widespread return to a normal situation.

The month of August also marked the grand gala of Central Banks which met at the traditional Jackson Hole Symposium. In his speech, J. Powell said that the FED would continue its accommodative policy for some time as long as the health situation did not improve significantly and the employment figures did not return to a level close to before the crisis. On inflation, Powell maintained his position stating that it remained transitory; position supported by the Biden Administration.

On the ECB side, dissonant voices are beginning to emerge opposing the accommodating message while remaining in a minority. Christine Lagarde, for her part, maintained her accommodating position and her message of support. Inflation is expected to continue to rise in the euro area, while remaining safe from overheating for the foreseeable future.

Bond issues were very weak in August, due to seasonality.

The dollar appreciated slightly against the euro, settling at 1.18105 in late July.

During the month of August, our strategy adopted at the end of July of lowering the exposure to interest rates finally paid off by avoiding being overexposed to the volatility of the latter and allowed us to offer a positive performance of 0.22% to investors. It was at the end of the month when bond issue volumes picked up that we increased our exposure by increasing our duration to 3.81 (3.52 at the end of July). We were also able to take advantage of the appreciation of the dollar against the euro in our strategy by keeping a certain focus on securities denominated in this currency. We decided to increase our exposure to Investment Grades securities by betting on the “flight to quality” effect during periods of volatility on the indices and the comeback of appetite for these securities. The fund’s annualized volatility fell further to 1.49%. In September, we will adopt a slightly more aggressive management style to better capture premiums while maintaining reactivity and diversification in the portfolio in order to keep a low risk level.


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.




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