Fully ESG-integrated
We fully integrate environment, social and governance principles into the investment process, which amplifies convexity. ESG materiality is at the core of our approach and we look to understand what extra-financial risks and opportunities companies are facing, the potential financial impact and how they concretely respond to these risks and seize those opportunities.
High conviction pure-play strategy
We invest solely in convertibles, with no exposure to synthetic securities and in order to express our convictions, we have a high weighting to off-benchmark positions. Through proprietary research, we apply our own rating methodology so we can confidently invest in companies that don’t have an official rating by a credit agency.
Dynamic approach
We manage positions actively because dispersion within markets always provides opportunities. We actively focus on delta so the strategy becomes more sensitive to equities or bonds depending on the market environment.
Maximising convexity
We focus in a smaller segment of the convertible bond universe that provides the best asymmetric profiles. This allows us to capture upside in rising markets while limiting downside in falling markets. An overall balanced convertible profile is pursued in a well-diversified portfolio across regions and sectors.
Tailwinds for the convertibles asset class
Lower interest rate risk
We expect inflation to increase. In this environment, convertibles provide duration protection because they have a negative correlation to government bonds and are positively correlated to equities and corporate bonds. We expect equity returns will continue to be the primary driver in the near to medium-term.
High levels of new convertible issuance
Convertible bond issuance is strong, reaching an all-time high in 2020, bringing more names to consider in a range of businesses with compelling long-term fundamentals in every region, as well as replacements for holdings that have become too bond-like or equity-like. We expect this trend to continue as companies accelerate their capital raising efforts.
Convertibles remain attractively valued
We currently think valuations are attractive in convertibles, which remain cheaper relative to their long-term fair value, supported by higher market volatility as a result of the pandemic. Today valuations are a greater source of alpha than medium-term risk for the asset class.
Mirabaud Sustainable Convertibles Global
In 2020, the Fund was awarded the SRI Label, created and supported by the French Ministry to raise the visibility of sustainable investment products.
Our Key Characteristics
Lower equity sensitivity
We have reduced equity sensitivity relative to the benchmark given the scope for elevated levels of market volatility as we move through the pandemic. Any market correction will provide a good entry point to raise our equity sensitivity.
Attractive fixed income profile
We expect shorter-duration and higher-yielding assets to outperform high-quality long-duration in the coming months. We have a higher level of credit relative to the benchmark, where the portfolio credit rating is equivalent to BB*, with a blend of investment grade and high yield names.
*Source: Mirabaud Asset Management as at 31/1/2021.
Benchmark is Rifinitiv Global Focus CB Hedged USD
Small-cap focus
We expect smaller companies to outperform because they combine a high level of cyclical exposure, which will lead to a good rebound in profitability with the unlocking of economies, with cheaper relative valuations.
We believe in a pure-play focus on convertibles where issuers have a sustainable focus to maximize convexity. We do not hold synthetic securities or options, which means the portfolio is completely transparent
The team behind the strategy
- Lead management has been working together since inception in 2013
- A combination of trading and fundamental experience
- 60 years of combined experience in convertibles, having faced all phases of the credit cycle
Renaud Martin
Co-Head of Convertibles
Nicolas Crémieux
Co-Head of Convertibles
Célia Levy
Portfolio Manager/Analyst
Oanh Tran
Analyst
Contacts
Switzerland
Jérôme Paganini
Head of Sales, Switzerland
MIRABAUD ASSET MANAGEMENT (SUISSE) SA
29, boulevard Georges-Favon
1204 Geneva
T +41 58 200 60 81
Switzerland
Alexis Dinsfriend
Sales Executive
MIRABAUD ASSET MANAGEMENT (SUISSE) SA
29, boulevard Georges-Favon
1204 Geneva
T +41 58 200 6047
Switzerland
Stefan Stucki
Head of Institutional Sales ZH Office
MIRABAUD ASSET MANAGEMENT (SUISSE) SA
Claridenstrasse 26
8002 Zurich
T +41 (0) 58 200 61 54
Switzerland
Louis William Wagner Ley
Wholesale Manager
MIRABAUD ASSET MANAGEMENT (SUISSE) SA
Claridenstrasse 26
8002 Zurich
T +41 58 200 61 59
United Kingdom
Benjamin Carter
Head of UK Wholesale
MIRABAUD ASSET MANAGEMENT LIMITED
5th Floor
10 Bressenden Place
SW1E 5DH London
T +44 20 3897 4411/M +44 7506715897
United Kingdom
Elliot Fowles
UK Wholesale Sales
MIRABAUD ASSET MANAGEMENT LIMITED
5th Floor
10 Bressenden Place
SW1E 5DH London
T +44 (0)7799 410071
United Kingdom
Deji Ijaiya-Harvey
UK Wholesale Sales
MIRABAUD ASSET MANAGEMENT LIMITED
5th Floor
10 Bressenden Place
SW1E 5DH London
T +44 20 3167 7028
Italy
David Basola
Head of Consultants, GFI & Southern Europe
Mirabaud Asset Management (Europe) - Succursale Italiana
Via Giuseppe Mengoni 4
20121 Milano
T +44 20 3167 7014
Italy
Mattia Pastrolin
Senior Sales Executive, Italy
Mirabaud Asset Management (Europe) - Succursale Italiana
Via Giuseppe Mengoni 4
20121 Milano
T +44 20 3167 7015
United Kingdom
Ilaria Malacco
Sales Executive, Italy
MIRABAUD ASSET MANAGEMENT LIMITED
5th Floor
10 Bressenden Place
SW1E 5DH London
T +44 20 3167 7021
France
Isabelle Richard
Head of Sales France
MIRABAUD ASSET MANAGEMENT (FRANCE) SAS
13, avenue Hoche
75008 Paris
T +33 (1) 7935 6802
France
Jérôme Spohn Villeroy
Wholesale Director
MIRABAUD ASSET MANAGEMENT (FRANCE) SAS
13, avenue Hoche
75008 Paris
T +33 (1) 7935 6803
Spain
Elena Villalba
Director Iberia & Latam
Mirabaud Asset Management (Europe), S.A., Sucursal en España
Calle Fortuny, 2ª Planta 6
28010 Madrid
T +34 91 793 7810
Learn more about our strategy
ESG and Convexity
Why responsible investing through robust environment, social and governance (ESG) criteria helps drive convexity
Opportunity is now
2021 – the year of convertibles. Why is inflation, new issuance and valuation good for global convertibles this year?