HSBC Global Investment Funds SICAV - RMB Fixed Income Capitalisation A


The HSBC GIF RMB Fixed Income Fund – is a well-managed, single-country RMB-based fixed income Fund seeking income and absolute return.

The fund has a robust bottom-up and research-driven investment process focusing on quality and valuation to identify companies trading below their assessed intrinsic value. HSBC also uses a proprietary bond credit rating system and financial models. The committee commented that this is one of the few well-managed investment processes and robust risk-managed RMB-based PRC fixed income fund with controlled and limited drawdown year-to-date with above-average benchmark return in 2020.

Managers are highly specialized in the RMB market and point to the advantage of the fund's flexibility. For example, the team can access onshore Policy Bank Bonds and onshore and offshore bonds.

The risk management process is solid, and attention is paid to efficient liquidity with a target of having 90% of the portfolio liquidated within five days. We noted that during the March 2020 bond sell-off, the fund managed a controlled and limited drawdown leading to an above benchmark return afterward. However, the over 50 weeks recovery for its maximum drawdown seems a bit long compared to peers.

ESG is well developed and integrated into the fundamental credit research process and each step of the investment process. Credits flagged with higher risk ESG scores undergo enhanced due diligence. Strong stewardship riding on the firm's strength, as expected from HSBC, is in line with UNPRI principles since 2006 and can make an impactful difference. The team also offered an excellent example for good stewardship set for SRI-related exclusion investing and management board voting protocol during the submission process. Its engagement is even better than most China-based asset managers.

This fund has been reviewed by seven industry veterans of the Benchmark judging committee.

House Awards: China Fixed Income
Hong Kong – Outstanding Achiever
Taiwan – Best-In-Class


ISIN: LU0692309627
Inception Date: 10/25/2011
AUM: USD 223405300
Manager Name: Ming Leap, 13/09/2019; Alfred Mui, 14/07/2014
Total Expense Ratio: 1.00%
3-Yr Return: 18.01%
3-Yr Max Drawdown: -4.21%

ESG Score: 48.07
GC Score: 56.26
Near-Term Score(<=2°C): 58.34%
Business Involvement:
Alcohol Involvement: 0.00%, …

Investment Style Consistency: 5.00
Environmental Consequence: 5.00
Stewardship – Engagement: 4.44

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