Top Performers in the Stock and Bond Markets
The Convertible Global Diversified fund, managed by Holinger Asset Management, offers a unique investment opportunity for those seeking growth with a defensive approach. With an impressive track record over the past ten years, the fund has delivered a growth of 80% and a return of over 8% at the start of the year (ISIN: DE000A0M9995).
This fund specializes in convertible securities, searching worldwide for papers trading at a discount. The core of the fund consists of high-quality papers, supplemented by more speculative investments. This approach allows for diversification, reducing risk compared to investing in a single market or asset class.
Convertible bonds are a hybrid of corporate bonds and stocks. They offer regular interest payments, repayment of capital at maturity, and an option to exchange the bond for the company's shares. This structure provides a bond-like floor, offering some protection during market downturns, while also participating in equity rises via the conversion feature.
However, it's essential to note that convertible securities are complex hybrids with risks including credit risk, interest rate risk, and equity risk. They can be more volatile than traditional bonds due to embedded options. Global diversification also introduces exposure to currency fluctuations, and some convertibles may have lower liquidity, impacting timely sales.
During the COVID-19 crisis, convertible funds with bond floors and equity upside generally offered some cushion during the sharp market drops in early 2020, but specifics depend on holdings and management. Detailed performance data for the Convertible Global Diversified fund during COVID-19 was not located in the search results.
One notable example of the fund's performance during the pandemic is the Carnival stock, which stood at 180% by the end of April 2020, delivering a monthly return of 80%. Carnival's convertible bond offered an attractive yield and seemed almost free during the crisis, attracting the attention of Holinger Asset Management's management team, led by Müller.
Müller sees the experienced management and past performance of the Convertible Global Diversified fund as top components for defense in the portfolio. The fund is a defensive building block for investors' portfolios, offering the potential for attractive returns with relatively low volatility.
Investors should consider factors such as volatility, maximum drawdown, and delta when choosing a convertible bond fund. Other companies affected by the pandemic, like Booking.com and American Eagle, also went to the capital markets via convertible bonds during the crisis.
If you're interested in precise figures or direct commentary on the Holinger Convertible Global Diversified fund, checking the latest fund fact sheets, Holinger Asset Management’s website, or a trusted financial data provider would be necessary. However, the fund's focus on convertibles trading at a discount, its global diversification, and its management's expertise in convertibles make it an appealing choice for those seeking a defensive approach to growth.
This fund, the Convertible Global Diversified, not only focuses on convertible securities as a means of investment but also diversifies across global markets. This approach, while providing a defensive strategy for growth, involves finance and investing opportunities in personal-finance portfolios due to its unique combination of bonds and stocks, offering potential for attractive returns with relatively low volatility.
Considering the expertise of Holinger Asset Management's management team, led by Müller, this fund could be an insurance for investors seeking a defensive approach in times of market volatility and downturns. Such opportunities might efficiently balance one's portfolio amidst the intricate risks associated with convertible securities.
