Im Nullzinsumfeld weiterhin
alternativlos? Ertragsbringer
Ermerging Markets Bonds
Giles Bedford
Client Portfolio Manager, Pioneer Investments Dublin
Pioneer Investment Konferenz 2017
This Document is Private and Confidential and is for the Sole Use of the Institutional or Professional Clients
to Whom it is Addressed. For Broker/Dealer Use Only and Not to be Distributed to the Public
2017 Global Growth Outlook
RUSSIA
Key GDP figures
1.2
UK
2016
2,1
2016
+ 3.6%
-0.4
World GDP Growth
2017
1,4
2017
U.S.
JAPAN
EUROZONE
2,3
1,5
2016
1,6
1,5
2016
2017
2017
CHINA
INDIA
BRAZIL
0.5
7.1
2016
7,4
2017
6,7
2016
6,4
2017
1,0
0,9
2016
2017
2%
4.7%
SWBSSP4 LN SWSAPS4 LN
equity
equity
Contribution
to World GDP Growth
-3.5
2016
2017
Source: Pioneer Investments’ forecasts. Data available as of January 5, 2017.
Page 2 I For Broker/Dealer Use Only and Not to be Distributed to the Public
DM
41%
EM
59%
Higher Inflation in 2017
World CPI (Pioneer estimates)
Inflation and Deflationary Factors (%)
China exponential
Eurozone
gains in export market Great Financial
Sovereign Crisis
Recession
shares
EM crisis
10
6
5
8
Pioneer Investments
Forecasts
6
Pioneer Investments
Forecasts
4
3
2
4
%
1
0
2
-1
0
-2
EMs
US
Jul 16
Aug 17
Jun 15
Apr 13
Mai 14
Mrz 12
Jan 10
Feb 11
Dez 08
Okt 06
Japan
Nov 07
Sep 05
Jul 03
Aug 04
Jun 02
Apr 00
Mai 01
Jan 97
DMs
Mrz 99
-3
-2
Feb 98
%
Oil price
freefall
Eurozone
Inflation in Develop Markets (DM) is finally coming back, mainly driven by the cost side rather than
demand pressure, with the exception of the US. In EMs the inflations outlook looks benign.
Source: Pioneer Investments on Thomson Reuters data. GAAR forecasts for 2017.Forecasts
provided by Pioneer Investments. As of December 31, 2016.
Page 3 I For Broker/Dealer Use Only and Not to be Distributed to the Public
Source: Pioneer Investments on Reuters data. Forecasts provided by Pioneer Investments.
As of December 31, 2016.
Why the Fed Will Continue Rate Normalization?
Core and Headline Inflations
Fed Funds and Unit Labour Cost
6
20
10
5
16
3
2
1
0
-1
8
12
6
8
%
% Change, 16 Quarters
Year on Year % Change
4
4
4
2
0
-2
-3
2000 2002 2004 2006 2008 2010 2012 2014 2016
US Headline Inflation
US Core Inflation
-4
1985
0
1990
1995
2000
Business sector: unit labour cost (LS)
2005
2010
2015
Fed Fund Target Rate (RS)
Core inflation is steadily above 2%, while unit labour costs are picking up and are now very much
disconnected with the low level of Fed Fund rates. After the 25 basis point hike in December 2016, we
expect three additional hikes in 2017.
Percent Change from Preceding Period, Quarterly, Seasonally Adjusted Annual Rate
Source: Pioneer Investments, U.S. Bureau of Economic Analysis. Data as of December 31, 2016.
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Source: Pioneer Investments, BLS. Data as of December 31, 2016..
High Debt and Low Productivity Growth
High Core Debt (Non-Financial Sector)
3,5
140
3,0
Growth of Labor Productivity (%)
160
120
USD Trillion
Low Productivity Growth
100
80
60
40
2,5
2,0
1,5
1,0
20
0,5
0
0,0
19992006
EMs
DMs
20072013
2013
Developed
2014
2015
2016
Emerging
In our view, fiscal policy reforms are urgently needed in order to fix global debt problems and boost
productivity growth, especially in Developed Markets.
Source: Pioneer Investments. BIS Statistics data as of December 31, 2016. NonFinancial Sector includes Debt of Non-Financial corporation and public debt.
Page 5 I For Broker/Dealer Use Only and Not to be Distributed to the Public
Growth of labour productivity per hour worked, percentage change.
Source: Pioneer Investments. The Conference Board Total Economy Database, data as of
December 31, 2016.
Emerging Markets Remain Relatively Resilient, But Differences Persist
Emerging Markets Vulnerability Index
India
Peru
China
Russia
Philippines
Brazil
Mexico
Indonesia
Korea
Thailand
Malaysia
South Africa
Colombia
Chile
Czech Republic
Poland
Hungary
Turkey
YTD Change of EM Currencies vs USD
Brazilian Real
Russian Ruble
South African Rand
Colombian Peso
Chilean Peso
Indonesian Rupiah
Taiwanese Dollar
Peruvian SOL
Thai Baht
Hungarian Forint
Indian Rupee
Czech Koruna
South Korean Won
Malaysian Ringgit
Philippine Peso
Polish Zloty
Chinese Renminbi
Mexican Peso
Turkish Lira
Less
Vulnerable
More
Vulnerable
-15
-5 Index level 5
Vulnerability Index January 2016
15
-20,00
-10,00
0,00
%
10,00
20,00
Vulnerability conditions remain quite heterogeneous, with India and China appearing to be among the
safest country in the EM universe. The broad improvement of economics led to a strong appreciation for
some currencies.
Vulnerability Index takes into account: CA and Funding; External Debt and ST External Debt;
Reserve Adequacy; Domestic variables. Source: Pioneer Investments, January 2017 compared
to January 2016. Data as of January 11, 2017.
Page 6 I For Broker/Dealer Use Only and Not to be Distributed to the Public
Source: Pioneer Investments. Datastream data as of December 31, 2016.
Playing Central Banks Asynchrony Through Currencies
DM Currencies
2017
Forecast
2,1
1,9
1,8
Growth Rising
120
117
100
1,7
1,6
1,5
60
USDJPY
80
1,2
Growth Falling
40
1,3
1.26
20
1,1
1.07
1,0
0
EUR/USD
GBP/USD
3
BRL
2
INR
RUB
COP
MXN
1
THB
PLN
0
1,4
Positive
Improving
140
2,0
Currency Level
EM Currencies Outlook
PHP
IDR
MYR
RON
-1
ILS
CLP
KRW TRY
PEN
CZK
ZAR
TWD
CNY
HUF
-2
-3
3
2
1
0
-1
-2
Inflation Rising
Inflation Falling
Negative
Worsening
-3
USDJPY Curncy
We expect the USD to strengthen versus the Euro and Yen in the first half of 2017 based on Trump’s expansionary plans.
This trend should reverse by the end of the year. In EM currencies, we think there are still undervaluation gaps to be
filled through selective positioning.
Source: Pioneer Investments. BIS Statistics data as of January 6, 2017. Non-Financial
Sector includes Debt of Non-Financial corporation and public debt.
Note: we use our internal forecasts for GDP and CPI 1y forward and estimate the delta from current
level assessing our macro view. Source: Pioneer Investments, GAAR. Data as of December 2016.
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What Stops The Bus?
Recent Emerging Market Performance Reflects Positive Sponsorship
EM Credit vs. Sovereign: The Search For Yield
117,00
Indexed to 100
112,00
107,00
102,00
97,00
92,00
87,00
2013
2013
2014
2014
JPMorgan - EMBI Global Diversified
Source: Bloomberg 19 January 2017
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2015
2015
2016
2016
JPMorgan CEMBI Broad Diversified
2017
Valuations Are Getting Stretched…
Bp
XS Corp Premium (ECP) = CEMBI BD single-B – {expected default rate x [1-RR]} –
Liquidity Premium-Sovereign Spread
Source: Bloomberg, Pioneer, January 20, 2017
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Technicals
Institutional demand provides stability to spreads and flows
Source: EPFR, Haver, Barclays Research, January 2017
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Risk To Watch
USD Overshooting and Impact on Debt
Foreign Ownership of USD Denominated Debts (% GDP)
40
35
% of GDP
30
25
20
15
10
5
0
Corporate
Sovereign
A key risk to watch is a possible overshoot of the USD vs main EM currencies. This will impact USD
denominated external debt (either sovereign or corporate), and in this vein we see Latin America (except
Brazil) as the most fragile area together with Turkey, Hungary, Philippines, Malaysia and Indonesia.
Source: Pioneer Investments, CEIC, BIS. Data as of December 31, 2016.
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Technicals
Net supply in EM corporates is manageable
Source: JPMorgan, January 2017
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Solid Fundamental Picture Resulted in Benign Default Rates
Distressed Pick-Up Driven by Commodity Related Sectors
Default Rate
Source: BofA Merrill Lynch 9 January 2017 . * distress is defined as spreads > 1,000bp.
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Distressed Ratio*
An Aging Population Suppresses Long-Term Returns in Mature Markets
Shiller Dependency Ratio Forecasts a Sustained Carry Deficit through 2056
18%
16%
14%
12%
10%
8%
6%
4%
2%
0%
1950
1,1
1,0
Inflationary
Spikes
0,9
0,8
0,7
0,6
0,5
Ratio 60 - 69/ 40 - 49
Earnings Yield
S&P 500 Earnings Yield and the Ratio of Sellers to Buyers
0,4
1960
1970
1980
S&P 500 Earnings Yield
1990
2000
2010
2020
Demographic 60 - 69 / 40 - 49 Forecast
2030
2040
2050
2060
Demographic 60 - 69 / 40 - 49
18
16
14
12
10
8
6
4
2
0
1926
4,00
3,50
3,00
2,50
2,00
1,50
1,00
1936
1946
1956
Bond Yields
1966
1976
1986
1996
2006
20 - 34 / 40 - 49 Forecast
Source: Shiller, Haver, UBS, September 2013.
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2016
2026
2036
2046
20 - 34 / 40 - 49
2056
Ratio 20 – 34 / 40 - 49
Long Bond Yields
United States: Long Bond Yields and the Difference Between the 20 - 34 and the 40 – 49 Cohorts
Trump Euphoria:
Jump, Pump or Dump?
DOWJIA
USD/EURO
17.3% since election
21.000
4.0% since election
1,15
19.500
US10YR
3,00
50bp since election
2,50
1,10
18.000
2,00
1,05
16.500
15.000
Feb 16
Aug 16
Feb 17
1,50
1,00
Sep-16
Nov-16
Jan-17
1,00
Feb 16
Aug 16
Feb 17
Are markets being too sanguine?
Markets may be paying too much attention to Trump’s pro-growth policies, and discounting those policies that may hinder growth.
Example – Trade: Smoot-Hawley Tariff (1930): 20% tariff; 18 months later world trade falls 66%
Example – Immigration: Mass deportation could take 0.4% – 0.5% off GDP
Sources: FRED, Macrobond Financial
Page 15 I For Broker/Dealer Use Only and Not to be Distributed to the Public
Europeans Fit The Pattern
Pessimistic about their children’s future, immigration, and the future of the EU
Falling support for the European Union
Increasingly pessimistic view of the future of Europe
Favorable View of the EU
I think our children will be _____ than their parents
75%
2004
100%
2016
75%
69%
50%
58%
54%
44%
38%
25%
25%
0%
0%
UK
France
Germany
Better Off
26%
NL
36%
Deu
31%
UK
31%
Italy
Worse
17%
Better
26%
33%
53%
Greece
18%
63%
0%
Worse Off
Refugees will ______ of domestic terrorism
Diversity makes my country a _____ place
24%
28%
A fear of terrorism due to refugee influx
A belief that diversity does not benefit countries
France
64%
50%
50%
25%
50%
10%
75%
Sources: Pew Research Center , Robert Westcott, March 2017
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Not
increase
likelihood
59
%
Increase
likelihood
The Populist Cycle: From Inequality To Wage Inflation…
And Beyond
{
{
{
ECONOMIC CYCLE
Phase 3:
Pervasive Shortages
Rapid CPI acceleration
Capital Flight
Demonetisation
Phase 1:
Output Growth
Real Wage Growth
Employment Growth
Moderate Inflation
Inventory Reduction
Import Growth
Phase 2:
Demand Growth
Supply Shortfall
Weaker currency
Rising Import Prices
Shortages
Inflation
Source: NBER Working Paper 2986, Rudiger Dornbusch & Sebastian Edwards, 1989
Page 17 I For Broker/Dealer Use Only and Not to be Distributed to the Public
Initial Conditions
Slower Growth
Economic Inequality
Reduced Living Standards
Change Mandate
TIME
Final Outcomes
Elevated Inflation
Deteriorating Budget Deficit
Weak Tax Capture
Rising Subsidy Costs
FX Devaluation
Real Wages fall massively
Unstable politics
ALIGNMENT NOT JUST VALUATION
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Investment Philosophy
Maximising Returns Through an Aggregated Approach
We believe that:
1
Active Asset Allocation and bottom-up security selection are key
drivers of Alpha
2
Risk profile can be adapted to reflect what we believe as the
best value among strategically advantaged issuers
3
Flexible portfolio construction may help mitigate the risk of
permanent capital impairment
4
The best ideas are not always found in the benchmark
Page 19 I For Broker/Dealer Use Only and Not to be Distributed to the Public
Our Investment Strategy Aims to Capture the Full Market Opportunity
Breadth of Investment Ideas
Benchmark
QUASI SOVEREIGN DEBT
Sample Ideas
HEDGE
ITRAXX CROSSOVER
OTHER
RUSSIAN ENERGY
RELATIVE VALUE
CORPORATE VS SOVEREIGN
MOMENTUM
IVORY COAST TREASURIES
LOCAL CURRENCY
TURKISH TREASURIES
CORPORATE HIGH YIELD
RUSSIAN BANKS
INDONESIAN COAL
CHINESE REAL ESTATE
MEXICAN CELLULAR SERVICES
CORPORATE IG
QATAR TELECOM
QUASI SOVEREIGN
RUSSIAN ENERGY
SOVEREIGN
KINGDOM OF THAILAND INTERNATIONAL
BONDS
BRAZILIAN GOVERNMENT BONDS
STRATEGY
SAMPLE IDEAS
SOVEREIGN DEBT
BENCHMARK
Source: Pioneer Investments, for illustrative purposes only.
Page 20 I For Broker/Dealer Use Only and Not to be Distributed to the Public
Drawdown Management
Credit/Market Event Case Studies
Pioneer Funds – Emerging Markets Bond:
Performance (rebased to 100) Around Major Market Dislocations
FED Taper: 2013
Price (Rebased
to 100)
105,0
100,0
95,0
90,0
85,0
1
11
21
31
41
51
61
71
81
Trading Days
91
101
121
131
141
151
Benchmark
Financial Crisis: 2008
Euro Crisis: 2011
130,0
120,0
110,0
100,0
90,0
80,0
70,0
60,0
50,0
105,0
Price (rebased
to 100)
Price (Rebased
to 100)
Fed Guidance on QE (May, 2013)
111
100,0
95,0
90,0
85,0
1
26 51 76 101 126 151 176 201 226 251 276 301 326
Trading Days
Global Banking Crises (August 2008)
Benchmark
1
11
21
31
41
51
61
Trading Days
Euro Crisis (August, 2011)
71
81
91
Benchmark
“2008” refers to the Global Financial Crises 8th August 2008, “2011” refers to the Eurozone Crises in 2 August 2011 and “2013” refers to the first Fed Tapering communication on 22 May
2013. Source: Pioneer Investments, January 2014. Performance is based on the A share EUR non distributing share class Net of fees. The benchmark is the JPMorgan EMBI Global Diversified
(95%) and JPMorgan Cash (5%).
Page 21 I For Broker/Dealer Use Only and Not to be Distributed to the Public
Broad Capability in Emerging Markets Fixed Income
Portfolio Name
Inception Date
AUM
Investment
Universe
Benchmark
Aggregate Debt
Local Currencies
Corporate & High Yield
Pioneer Funds - Emerging
Markets Bond
Pioneer Funds Emerging Markets Bond
Local Currencies
Pioneer Funds Emerging Markets
Corporate Bond
Pioneer Funds Emerging Markets
Corporate High Yield
Bond
Pioneer Funds Emerging Markets
Bond Short-Term
4 July 2000
4 November 2009
11 December 2012
11 July 2012
3 June 2015
EUR 3.5 billion
EUR 195 million
EUR 305 million
EUR 110 million
EUR 1.1 Billion
Short Term
Sovereign and
Corporate Emerging
Markets Hard and
Local Currency Debts
with a term of less
than 3 years
Sovereign Hard and Local
Currency plus Corporate
Emerging Markets Hard
and Local Currency Debts
EM Debt Instruments
denominated in Local
Currencies
Corporate Emerging
Markets Hard and
Local Currency Debts
Corporate Emerging
Markets, High Yield
Debts
JPM EMBI Global
Diversified 95%
JP Morgan GBI – EM
Global Diversified Index
JPMorgan CEMBI
Broad Diversified
JPM CEMBI
75% JP Morgan CEMBI
Broad Diversified Non– Broad Diversified 1-3
Investment Grade
year Index / 25% JP
Morgan EMBI Global
Diversified 1-3 year
Index
JPM Cash 5%
Source: Pioneer Investments as at 17 February 2017
Page 22 I For Broker/Dealer Use Only and Not to be Distributed to the Public
Pioneer Funds – Emerging Market Bond
POSITIONING & PERFORMANCE
Page 23 I For Broker/Dealer Use Only and Not to be Distributed to the Public
Pioneer Funds – Emerging Markets Bond
Key Portfolio Allocations
Asset Allocation
100%
73,0%
80%
60%
36,9%
40%
20%
0%
25,0%
5,1%
Sector Exposure
40%
11,1%
0,6%
0,3%
IG Corporates
HY Corporates
0,0%
Treasuries
50%
17,8% 21,2%
Sovereign
Government Related
Portfolio
4,1%
4,9%
Cash
Benchmark**
Portfolio Weight
30%
20%
10%
0%
Source: Pioneer Investments as at 17 Feb 2017. **Benchmark: JPM EMBI Global Diversified 95%, JPM Cash 1 Month Euro 5%. Pioneer Funds – Emerging Markets Bond is actively managed;
sector allocations will vary over periods and do not reflect a commitment to an investment policy or sector.
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Brazil
Argentina
Russia
Nigeria
China
Turkey
Mexico
Ukraine
United Arab Emirates
India
Hong Kong
Zambia
Tunisia
Gabon
Iraq
Mongolia
Venezuela
Angola
Zambia
Trinidad and Tobago
Cote D'Ivoire
Serbia
South Africa
Romania
Peru
Indonesia
Costa Rica
Sri Lanka
Uruguay
Mexico
Kazakhstan
Malaysia
Chile
Colombia
Poland
Hungary
Philippines
Pioneer Funds – Emerging Markets Bond
Select Country Relative Weights (Excluding Derivatives)
10,0%
8,0%
6,0%
4,0%
2,0%
0,0%
-2,0%
-4,0%
Fund
Relative
Source: Pioneer Investments as at 17 February 2017.
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Pioneer Funds – Emerging Markets Bond
Shorter Duration (vs. Index) with Higher Income
Key Details
Fund
Benchmark
Yield To Maturity (%)
6.77
4.95
Spread Duration (Years)
4.26
6.24
Effective Duration (Years)
5.48
6.17
BB
BB+
Term Exposure
40,0%
30,0%
20,0%
10,0%
Average Quality
0,0%
Benchmark
Credit Rating (Worst Of)
50,0%
40,0%
30,0%
20,0%
10,0%
0,0%
Benchmark
CCC &
Below
B
BB
BBB
and
Above
Weight
Source: Pioneer Investments as 17 February 2017. Ratings shown are as rated by Moody's Investor Service, Standard & Poor's and Fitch. Where a security is rated by more than one
agency, an average of available ratings across S&P, Moody’s and Fitch is used. Benchmark is JPM EMBI Global Diversified 95%, JPM Cash 1 Month Euro 5%.
Page 26 I For Broker/Dealer Use Only and Not to be Distributed to the Public
11+ year
7-10 year
3-7 year
1-3 year
< 1 year
Cash
Weight
Pioneer Funds – Emerging Markets Bond
Calendar Year Returns (USD, Net) 2012 – YTD 2016
25
21,71
20
16,53
15
14,18
12,4
10
6,38
5
1,67
0,63 1,04
6,21
2,33
5,18
1,44
0
-1,78
-5
-4,05
-4,77
-10
2016 YTD
2015
2014
Fund
Benchmark
2013
2012
Relative
Source: Pioneer Investments as at September 30th 2016. Calendar Year Returns data provided refers to Class I US Dollar Non-Distributing only, and is based upon NAV net of fees. The
benchmark is JPM EMBI Global Diversified 95%, JPM Cash 1 Month Euro 5%. Performance figures are in USD and have been converted from the sub-fund's base currency, the Euro. Past
performance does not guarantee and is not indicative of future results.
Page 27 I For Broker/Dealer Use Only and Not to be Distributed to the Public
WHAT ABOUT SHORT DURATION?
Page 28 I For Broker/Dealer Use Only and Not to be Distributed to the Public
Pioneer Funds - Emerging Markets Bond Short-Term
Seeks Appealing Yield Potential with Limited Risk Exposure
Breadth and Depth of Investment Ideas
•
Proprietary research drives our process, while seeking to avoid
risks of capital impairment
•
Dedicated specialists identify compelling opportunities in the
short end of the curve across a wide array of asset classes
Inception Date
3 June 2015
AUM
€603 million
Investment
Universe
Sovereign Hard and
Local Currency plus
Corporate Emerging
Markets Hard and
Local Currency
Debts, with a term of
less than 3 years
Risk Efficiency
•
Portfolio Construction helps to identify and manage unintended
risk
•
Carefully managed contribution for each trade, focusing on
win/loss ratio
Targeted Portfolio Design
•
Positioned to perform in a rising rate environment by investing in
shorter duration instruments of typically 1-3 years
•
Focus on generating yield that offers curve exposure with limited
credit risk
Reference Index
Currency
JPM CEMBI Broad
Diversified 1-3 year
75%
JPM EMBI Global
Diversified 1-3 year
25%
Predominantly Hard
Currency. Up to 25%
Local Currency
Source: Pioneer Investments as at 30 September
2016
The internal guidelines referenced do not necessarily represent statutory limitations. These guidelines are used in the daily management of the strategy’s investments, are subject to change and
should not be relied upon as a long-term view of the strategy’s exposures, limitations and/or risks.
Page 29 I For Broker/Dealer Use Only and Not to be Distributed to the Public
Seeking to optimise Yield While reducing Duration Risk
7
7
6,11
Yield to Maturity (%)
6
5
6
4,7
4,95
5
4,72
4
4
3,69
3
3
2
2
0,95
1
0
1
0
Fund
EMBI
CEMBI
Yield to Maturity (LHS)
US HY
Euro HY
Euro IG 5-7
Duration (RHS)
Source: JPMorgan, BAML, Bloomberg. 17 February 2017. Refers to Pioneer Funds – Emerging Markets Bond Short-Term. EMBI refers to JP Morgan EMBI Global Diversified Index, CEMBI refers to
JP Morgan CEMBI Broad Diversified Index, US Corporates Large Caps refers to JP Morgan JULI US High Grade Corporate, US HY refers to BofA Merrill Lynch US High Yield index, Euro HY refers to
BofA Merrill Lynch Euro High Yield and Euro IG refers to BofA Merrill Lynch EMU Corporate Large Cap Index. The comparison to these indices is provided for illustrative purposes only. They are not
the benchmark of Pioneer Funds - Emerging Markets Bond Short-Term and do not represent the holdings of the sub-fund.
Page 30 I For Broker/Dealer Use Only and Not to be Distributed to the Public
Pioneer Funds - Emerging Markets Bond Short-Term
An Alternative Yield And Duration Profile
Term Structure*
50,00%
40,00%
30,00%
20,00%
10,00%
0,00%
< 1 Year
1-3 year
3-7 year
Fund
* Does not include Floating Rate Notes
EMBI Index
7-10 year
11+ year
Cash
CEMBI Index
EMBI refers to the JP Morgan EMBI Global Diversified. CEMBI refers to the JP Morgan CEMBI Broad Diversified. “Fund” refers to Pioneer Funds – Emerging Markets Bond Short-Term.
Emerging Markets
Bond Short-Term
Emerging Markets
Bond
EM Sovereign
(EMBI Index)
EM Corporate
(CEMBI Index)
Yield To Maturity (%)
4.70
6.77
4.95
4.72
Spread Duration (Years)
2.00
4.26
6.24
4.60
Effective Duration (Years)
2.13
5.48
6.17
4.56
BB
BB
BB+
BBB-
Key Details
Average Quality
Source: Factset and Pioneer Investments as of 17 February 2017.
Credit Rating data and Average Credit Quality calculations are an average of available ratings across S&P, Moodys and Fitch. In the case of sovereign bonds that are not rated by any of the 3
referenced rating agencies, an average of the issuer rating is used. Non sovereign bonds that are not rated by any of the 3 referenced rating agencies are excluded from the Average Credit
Quality calculation.
The comparison to the indices above is provided for illustrative purposes only They are not the benchmark of Pioneer Funds - Emerging Markets Bond Fund and Pioneer Funds - Emerging
Markets Bond Short-Term and do not represent the holdings of the sub-funds.
Page 31 I For Broker/Dealer Use Only and Not to be Distributed to the Public
Pioneer Funds – Emerging Markets Bond Short-Term
Returns (USD, Net) since Inception
Returns in USD %
10
9,05
9
7,72
8
7
6
5
4
3
2
1,86
1
0
YTD
1 year
since fund inception
Fund
Source: Pioneer Investments as at 28 February 2017. Fund Inception: 03/06/2015. Returns data provided refers to Class I US Dollar Non-Distributing only, and is based upon NAV net
of fees. Performance figures are in USD and have been converted from the sub-fund's base currency, the Euro. Past performance does not guarantee and is not indicative of future
results.
Page 32 I For Broker/Dealer Use Only and Not to be Distributed to the Public
Emerging Markets Debt Capability At Pioneer Investments
WHY CHOOSE US?
Page 33 I For Broker/Dealer Use Only and Not to be Distributed to the Public
High Level of Alignment Achieved Through A Flexible Approach
Pioneer Funds – Emerging Markets Bond
Breadth and Depth of Investment Ideas
•
Unconstrained approach, targeting returns from a broad array of
investment themes
•
Dedicated specialists identify opportunities beyond consensus,
strengthening diversification benefit
Risk Efficiency
Inception Date
4 July 2000
Investment
Universe
Sovereign
Quasi Sovereign
Corporate
Benchmark
JPMorgan EMBI
Global Diversified
IG (95%)
JPM Cash 1 Month
Euro (5%)
•
Portfolio Construction helps to identify and manage unintended
risk
•
Carefully managed contribution for each trade, focusing on
win/loss ratio
Credit quality
IG & HY
•
Effective use of cash to help contain drawdown, focusing on
Sortino ratio
Single corp issuer*
Max. 5% (IG), Max.
3% (HY)
Portfolio Credit*
Quality
Minimum B-
Currency
Predominantly
Hard Currency. Up
to 25% Local
Currency.
Innovative Portfolio Design
•
Recognising long-term structural trends (credit, local
currency…) enabling balanced income / carry
•
Idiosyncrasy of the return profile vs. competitors
Source: Pioneer Investments. *The internal guidelines referenced do not necessarily represent statutory limitations. These guidelines are used in the daily management of the fund’s
investments, are subject to change and should not be relied upon as a long-term view of the fund’s exposures, limitations and/or risks. For complete information on the Fund’s investment
objectives, strategy, risks, and limitations please review the Fund prospectus.
Page 34 I For Broker/Dealer Use Only and Not to be Distributed to the Public
Pioneer Funds – Emerging Markets Bond
Why a Barbell Strategy?
Cash
Treasuries
Interest Rate
Derivatives
Effective Duration:
Duration
Management
Alpha & Income
Generation
Treasuries
Quasi’s
High Yield
EM Sovereign
Yield to Maturity:
Sovereign
Fund:
5.5 yrs
Bmk:
6.2 yrs
Quasi Sovereign
IG Corporates
HY Corporates
Fund:
6.7%
Bmk:
4.9%
Cash
Source: Pioneer Investments as at 30 September 2016. Benchmark: JPM EMBI Global Diversified 95%, JPM Cash 1 Month Euro 5%. Pioneer Funds – Emerging Markets Bond is actively
managed; sector allocations will vary over periods and do not reflect a commitment to an investment policy or sector.
Page 35 I For Broker/Dealer Use Only and Not to be Distributed to the Public
THANK YOU
Page 36 I For Broker/Dealer Use Only and Not to be Distributed to the Public