Exposure to global equity market growth while limiting downside risks
Convertible bonds are hybrid securities with both bond and equity characteristics. They seek to provide investors the ability to participate in the equity upside coupled with the principal protection of a bond1 to limit the downside.
A unique asset class with an asymmetrical return profile
The AXA WF Framlington Global Convertibles fund invests primarily in balanced convertible bonds which have historically demonstrated the unique characteristic of capturing approximately 60% of equity upside while limiting downside to around 40%2. This asymmetrical return results in an attractive risk/reward profile when compared to equity markets over the long term.
Suited to current market conditions
The Fund is particularly attractive during these times of high market volatility and uncertainty. The Fund is well placed to take advantage of a potential mid-term equity market rebound, whilst simultaneously benefiting from protection against current uncertainty through its bond component. Furthermore, the primary market - a key growth driver of the convertible bond market - is entering a dynamic cycle, fuelled by the large financial requirements of companies, particularly those exposed to emerging market growth.
AXA IM's advantage in convertibles
- One of the top performing funds within its Morningstar3 category
- Managed by 2 convertible bonds specialists; 6 years of collaborative experience, 20 years of combined investment experience
- A large set of equity growth opportunities by investing globally
- No currency risk as the Fund is fully hedged in euros
- The direct support of more than 50 AXA Framlington equity portfolio managers/analysts that help the Fund Managers identify the most promising stocks
- Optimised downside protection through the selection of liquid4, well-rated companies (BB- minimum)
- A process supported by AXA IM's credit analysts, economists and portfolio risk analysis team
Exposure to global equity market growth while limiting downside risks: This statement refers to an objective only and does not constitute a representation or undertaking on the part of the investment manager
- Bonds are subject to default
- Participation can vary: when comparing the performance indicator of the fund, the UBS Global CB Focus USD Index to the MSCI World USD Index, with average equity participation of 62% and downside participation of 46%, (31/12/1999 – 31/08/2011).
- Source: Morningstar, Universe Europe, Convertible Bond - Global, EUR Hedged and Convertible Bond – Global (as at 31/08/2011). References to league tables and awards are not an indicator of future rankings in league tables or awards. Information contained in this document may be updated from time to time. Information contained herein may vary from previous or future published versions of this document.
- According to the Fund Manager's analysis
MORNINGSTAR
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