Ellipsis AM is launching Ellipsis Credit Road 2028

Ellipsis AM is launching Ellipsis Credit Road 2028, its first predominantly fixed maturity high yield1 bond fund managed by Delphine LALOUM.

  • Ellipsis AM has been renowned for its (convertible and credit) bond portfolio management for close to 20 years and is launching its first first fixed maturity bond fund in market conditions that its investment team considers conducive to capturing attractive returns2.
  • The fund’s strategy is to buy and hold euro-denominated and predominantly high yield1, i.e. speculative grade, bonds - but also investment grade and convertible bonds – until maturity. The portfolio focuses on credit quality and governance as a means of protecting against default risk, and on diversification through the issuers selected, with an average portfolio rating of BB-/Ba3. It is classified as an article 8 fund under SFDR3. The marketing period will run for a year (until 15 November 2023 inclusive). The fund is registered in France and is soon to be marketed in Switzerland, Italy and Luxembourg.
  • Ellipsis Credit Road 2028 is managed by Delphine LALOUM. Delphine Laloum joined Ellipsis AM in September 2022 as a credit and high yield portfolio manager. She has 20 years of experience, for instance as head of high yield fund management at Rothschild & Cie where she was involved in developing dated funds among others. She is also lead manager of the Ellipsis High Yield Fund, which boasts a track record of 10 years and a 4-star rating from Morningstar4.
  • “We believe bond yields in this segment are approaching historical highs, with current levels looking more attractive than those offered in the investment grade segment adjusted for default risk. The high yield universe is now on a more solid footing than during previous economic crises and also more diversified in terms of both issuers and sectors, consisting largely of BB ratings. We do not expect to run into a liquidity wall within the next 24 months. Our view is that the market is overestimating the implied default risk of European high-yield issuers, and we consider this unjustified. It is in these circumstances that we are launching Ellipsis Credit Road 2028; at current market conditions and barring a default, the portfolio we have built up of 90 to 100 names at launch aims to deliver an annualised return at maturity net of fees of 6.75% (I units)”, concludes the portfolio manager5

  • Ellipsis Credit Road 2028 poses a risk of capital loss and its performance is not guaranteed. For more information, investors can consult the regulatory (including the prospectus and notably the risk profile) and commercial documentation available on the fund's website.

(1) This category corresponds to speculative bonds rated below BBB- /Baa3 (according to the rating scales of the official agencies or rating deemed equivalent by Ellipsis AM). The fund may invest up to a maximum of 100% of its net assets in Euro or up to 20% of its net assets in other foreign currencies.
(2) The fund’s investment objective is to obtain at the Fund Maturity Date on 30 June 2028 an annualised return net of fees of more than 5.75% for I units, more than 5.40% for J units and more than 4.90% for P units (the “Target Return”), through active and discretionary management of a portfolio of debt securities.  This net annualised performance target is based on the Management Company’s market assumptions which factor in a potential default risk of one or more issuers and any currency hedging expenses; it does not constitute a guaranteed return. 
(3) Overall rating issued by Morningstar at 30/09/2022. Morningstar category: EUR High Yield Bonds - I EUR units. References to past rankings and awards are not indicative of future rankings and awards. Past performance is not a reliable indicator of future results.
(4) ESG: Environment / Social / Governance. SFDR: European Regulation (EU) 2019/2088, referred to as the Sustainable Finance Disclosure Regulation (SFDR). More information can be found in our ESG policy (which sets out our environmental, social and governance criteria): https://www.ellipsis-am.com/compliance/rapport-esg.
(5) Analyses carried out based on data from ICE, S&P, Spread Research and Moody’s in October 2022. Past performance is not a reliable indicator of future results.