Our High Yield Group passed the 3-year performance anniversary at the end of April.
Noteworthy Milestone:
Our High Yield Group passed the 3-year performance anniversary at the end of April. Current High Yield Strategies are long-only corporate credit, with no leverage and no derivatives. The following charts present eVestment performance & risk metrics for our four High Yield Composites:
Past Performance is not indicative of future performance. The performance of the Broad High Yield Composite is hypothetical, as the assets of the of the Select High Yield strategy and the Quality High Yield strategy have been combined to create the Broad High Yield strategy.
Peer group percentile rankings are versus eVestment’s US High Yield Fixed Income (for Broad & Select High Yield), Quality High Yield Fixed Income (for Quality High Yield) & Short Duration High Yield FI (for Short Duration High Yield) universes. Data shown includes all results reported in eVestment as of May 27, 2020 and does not reflect any selection by FSI.
Portfolio Manager Comments
“We’re pleased with the performance of our High Yield Composites, since inception. Most particularly because our primary focus has remained, as always, on the goal of capital preservation during downside market corrections. We believe our Group’s success at the 3-year mark has been the result of a dynamic, Team effort with all our credit analyst partners. Our time-tested, investment process should lead to continued investment success if implemented with stringent discipline, by a talented and diligent Team”.
- Co-Portfolio Managers/Co-Heads of High Yield, Matt Philo and Jason Epstein
High Yield: Foundational Strengths:
People – Synergetic Co-Portfolio Manager structure, supported by talented credit analysts
Process – Time-tested Investment Process that Matt has followed since the mid-1990’s
Performance – Solid, consistent, and we believe, sustainable through any macro/market environment
Platform – Parent company among the largest and most stable in global finance
High Yield Performance:
Annualized/Calendar Year Performance
The Inception Date of the FSI High Yield Composites was April 30, 2017. Past Performance is not indicative of future performance. The performance of the Broad High Yield Composite is hypothetical, as the assets of the Select High Yield strategy and the Quality High Yield strategy have been combined to create the Broad High Yield strategy. Composite returns do not reflect the deduction of investment advisory fees. A client’s return will be reduced by the investment fees. If a client placed $100,000 under management and a hypothetical gross return of 7% were achieved, the investment assets before fees would have grown to $196,715 in 10 years. However, if an advisory fee of 0.4% were charged, investment assets would have grown to $188,987, or an annual compounded rate of 6.6%. Note: due to rounding percentages may not precisely reflect the absolute figures.
High Yield Portfolio Managers
Matt Philo, CFA
Senior Portfolio Manager, Co-Head of High Yield
Matt joined First State Investments in May 2016, and has 31 years of industry experience.
Matt was Executive Managing Director & Head of High Yield at MacKay Shields LLC, serving as Portfolio Manager to $22 Billion of assets across institutional and retail accounts. He joined MacKay Shields in 1996 and managed institutional accounts for the firm from September 1996 through May 2014.
He managed the Mainstay High Yield Corporate Bond Fund (MYHIX) from December 2000 through May 2014.
Matt has an MBA in Finance from New York University Stern School of Business, and a BA in Economics from University at Albany SUNY. Matt is a CFA Charterholder.
Jason Epstein
Senior Portfolio Manager, Co-Head of High Yield
Jason joined First State Investments in September 2016, and has 18 years of industry experience.
Jason was a Managing Director with Oak Hill Advisors where he was responsible for managing a team of analysts covering a broad range of sectors.
While at Oak Hill he was responsible for managing leveraged credit investments in the building products, chemicals, home-building, lodging and paper & packaging sectors.
Prior to Oak Hill, Jason was an analyst within investment banking at Credit Suisse First Boston where he was a member of both the Financial Sponsors and Technology groups.
Jason has a BS in Economics from The Wharton School, University of Pennsylvania.
This material is solely for the attention of institutional, professional, qualified or sophisticated investors and distributors who qualify as qualified purchasers under the Investment Company Act of 1940, as accredited investors under Rule 501 of SEC Regulation D under the US Securities Act of 1933, and as qualified eligible persons as defined under CFTC Regulation 4.7. It is not to be distributed to the general public, private customers or retail investors in any jurisdiction whatsoever.
This presentation is issued by First State Investments (US) LLC (“FSI” or “First State Investments”). The information included within this presentation is furnished on a confidential basis and should not be copied, reproduced or redistributed without the prior written consent of FSI or any of its affiliates.
This document is not an offer for sale of funds to US persons (as such term is used in Regulation S promulgated under the 1933 Act). Fund-specific information has been provided to illustrate First State Investments’ expertise in the strategy. Differences between fund-specific constraints or fees and those of a similarly managed mandate would affect performance results. This material is provided for information purposes only and does not constitute a recommendation, a solicitation, an offer, an advice or an invitation to purchase or sell any fund and should in no case be interpreted as such.
Any investment with First State Investments should form part of a diversified portfolio and be considered a long term investment. Prospective investors should be aware that returns over the short term may not match potential long term returns. Investors should always seek independent financial advice before making any investment decision. The value of an investment and any income from it may go down as well as up. An investor may not get back the amount invested and past performance information is not a guide to future performance, which is not guaranteed.
Certain statements, estimates, and projections in this document may be forward-looking statements. These forward-looking statements are based upon First State Investments’ current assumptions and beliefs, in light of currently available information, but involve known and unknown risks and uncertainties. Actual actions or results may differ materially from those discussed. Actual returns can be affected by many factors, including, but not limited to, inaccurate assumptions, known or unknown risks and uncertainties and other factors that may cause actual results, performance, or achievements to be materially different. Readers are cautioned not to place undue reliance on these forward-looking statements. There is no certainty that current conditions will last, and First State Investments undertakes no obligation to publicly update any forward-looking statement.
PAST PERFORMANCE IS NOT INDICATIVE OF FUTURE PERFORMANCE.
Reference to the names of each company mentioned in this communication is merely for explaining the investment strategy, and should not be construed as investment advice or investment recommendation of those companies. Companies mentioned herein may or may not form part of the holdings of FSI.
The comparative benchmarks or indices referred to herein are for illustrative and comparison purposes only, may not be available for direct investment, are unmanaged, assume reinvestment of income, and have limitations when used for comparison or other purposes because they may have volatility, credit, or other material characteristics (such as number and types of securities) that are different from the funds managed by First State Investments.
For more information please visit www.firststateinvestments.com. Telephone calls with FSI may be recorded.
The First State Investments logo is a trademark of the Commonwealth Bank of Australia or an affiliate thereof and is used by FSI under licence.
MAR000595
