Alma Advent Global Convertible Fund
Overview
Alma Advent Global Convertible Fund invests in convertible bonds globally.
The fund’s management is delegated to Advent Capital Management.
Share Class
NAV
Cumulative Performance (%)
Fund Inception 30 November 2016
| Daily | Monthly | Ytd | 1Yr | 3Yr | 5Yr | Incept. | Incept.Date |
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The performance data shown represents past performance. Past performance is not a guarantee of future results. Current performance may be lower or higher than the performance quoted. The investment return and the principal value of an investment will fluctuate so that an investor’s shares, when redeemed, may be worth more or less than their original cost.
Strategy & Manager
Fund Strategy
Long only global convertibles strategy seeking attractive returns from “theoretically cheap”, positively asymmetric balanced convertible securities with attractive risk/reward profiles offering 75% – 85% of the underlying equity upside, while limiting downside risk.
Investment Manager
Advent Capital Management is a US headquartered manager with an office in London and resources dedicated to Asia, with over $8.5bn AUM, founded in 1995. Advent has one of the largest platforms in the world emphasizing convertibles as an asset class.
Key Persons
David Hulme,
Portfolio Manager
Prior to joining Advent in 2002, David worked at Van Eck Global Asset Management as an Investment Director and Portfolio Manager. David has more than 20 years involvment as a Portfolio Manager on Advent Balanced Strategies. David is a graduate of Cambridge University and is an Associate of the UK Society of Investment Professionals (ASIP). He is also a member of the Association of Chartered Accountants, which is the U.K. equivalent of a Certified Public Accountant.
Tony Huang,
Associate Portfolio Manager
Prior to joining Advent in 2007, Tony was at Essex Investment Management in Boston where he headed the Technology sector research coverage and managed Essex’s diversified Research Fund. Tony has more than 14 years involvement as an Associate Portfolio Manager on Advent’s closed end funds. Tony is a graduate of the University of Pennsylvania’s Wharton School of business. He has received the Chartered Financial Analyst (CFA) designation.
Statistics & Commentary
Performance
The performance data shown represents past performance. Past performance is not a guarantee of future results. Current performance may be lower or higher than the performance data quoted. The investment return and the principal value of an investment will fluctuate so that an investor's shares, when redeemed, may be worth more or less than their original cost.
Investment Manager's Commentary
as of 31/07/2024Market Review and Outlook
Global equity markets advanced during the month of July, with the MSCI ACWI (USD Hedged) returning +1.24%. Small cap equities, particularly value stocks, responded to positive inflation data and began to close the gap with large cap equities, as the Russell 2000 outperformed the S&P 500 by nearly 900 basis points during the month. A weaker labor market and better-than-expected inflation data improved the prospects for interest rate cuts. At its July 31 meeting, the U.S. Federal Reserve shifted its commentary to include full employment as part of its dual mandate, which was taken as a precursor to a more dovish stance in the coming months. European markets, despite being fresh off a rate cut in June, underperformed the U.S., as continued political uncertainty and weaker purchasing manager indices (PMI) weighed on growth forecasts. In emerging markets, poor returns in China contributed to a more modest +0.61% return of the MSCI Emerging Markets Index. Global bond markets rose as the growth outlook faded, as evidenced by the ICE BofA Global Broad Market Index return of +2.03% (USD Hedged) and the ICE BofA Global High Yield Index return of +1.79% (USD Hedged). Global convertibles, represented by the FTSE Global Focus Index, returned +1.48% (USD Hedged) during the month.
There was $9.0 billion of global convertible issuance in July and $71.6 billion year-to-date, which represents a 45% increase compared to the strong primary market seen in the first 7 months of 2023, and is on pace to exceed the $80-$100 billion of issuance expected during a healthy calendar year. New deals are from a blend of existing issuers and new companies, and the terms of these deals are generally favorable for investors.
Fund
The fund lagged the benchmark return during the month due to a large shift in equity markets from cyclical to defensive leadership, with the latter vastly outperforming. This is further demonstrated by the MSCI World Value equity index rising +4.77% (USD) in July while the MSCI World Growth equity index fell -0.96% (USD). With rising broader growth concerns, conservative forward profit guidance has led to valuation corrections in many industries with large convertible exposure, including artificial intelligence (“AI”) hardware, cloud software, and renewable energy. The latter have also been affected by uncertainty related to the U.S. election and future government policy after 2024. The fund benefitted from security selection in Industrials and Healthcare. The Technology sector detracted the most as valuations fell at certain issuers participating in the AI infrastructure buildout. The fund is underweight the Utilities sector, which benefitted from falling interest rates and was the highest returning sector in the index. On a regional basis, the Americas and Asia detracted the most from relative performance. The largest of the relative detractors in both regions came from the Technology sector.
During the month, we initiated new positions in several attractively priced new issues across the globe in the Healthcare, Financials, Consumer Discretionary and Technology sectors. We exited certain positions in the Technology and Healthcare sectors, where we felt equity upside was limited, and sold some existing holdings where changes in the underlying equity resulted in muted total return potential for the convertibles.
Facts & Documents
Facts
Fund Domicile: Luxembourg
Fund Type: UCITS SICAV
Fund Launch: 30 November 2016
Base Currency: USD
Depositary, Administrator, Transfert Agent: BNP Paribas SA
Dealing: Each day with a 1-day notice
Cut-off time: 12pm CET
Management Company: Alma Capital Investment Management SA (LU)
Investment Manager: Advent Capital Management, LLC (US)
Fund Managers: David Hulme and Tony Huang
Countries where the fund is registered:
Luxembourg, France, UK
Sustainability-related disclosures:
The information related to the integration of sustainability risks and to the potential adverse sustainability impacts at the sub-fund level can be found in the prospectus of the Fund.
Identifiers:
Institutional EUR Capitalisation Share Class
ISIN: LU2763531444
Ticker: ALMCNVI LX
Launch: 13 Sep 2024
Institutional USD Capitalisation Share Class
ISIN: LU2763531360
Ticker: ALZCONI LX
Launch: 13 Sep 2024
Documents
Subscribe to the Fund Monthly Newsletteravailable upon request