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AXA WF Global Income Generation

ISIN LU0960401486

Last NAV 110.6700 EUR as of 14/01/20

Overview

Investment objectives

The Sub-Fund is actively and discretionarily managed in order to capture opportunities across a wide array of asset classes, with an investment strategy that uses:- strategic asset allocation (based on long term macroeconomic views)- tactical asset allocation (based on the identification of short term market oportunities)- extensive diversification, with no formal restriction on the proportion of assets that can be allocated to any one particular market. This diversification exposes the Sub-Fund to a moderate level of volatilityThe Sub-Fund is invested in a broad set of world market bonds (including high-income generating bonds, either unrated, rated below or above investment grade), equities (including high dividend equities through fundamental approach and/or the use of a proprietary quantitative process) issued by companies which are domiciled or listed in the OECD or non-OECD countries. The Sub-Fund may also get exposure to other asset classes including without limitation real estate, volatility of equity markets, commodities (notably through commodity indices, exchange traded funds, equities). Over the long term a high proportion of the Sub-Fund's assets will be invested in fixed income and Money Market Instruments. There is no formal restriction on the proportion of the Sub-Fund's assets that can be invested in and/or exposed to any particular market. The proportion of the Sub-Fund's assets that can be invested in equities and/or in commodities is very flexible and may vary from 0% to 50%. The Sub-Fund is a multi asset class portfolio, seeking to provide regular income and to achieve medium term capital growth through dynamic and flexible allocation across a wide array of asset classes globally. Fixed income exposure of the Sub-Fund denominated in non-EUR currency will be partially hedged against EUR.The Sub-Fund may invest up to 5% of net assets in contingent convertible bonds (CoCos).The Sub-Fund applies AXA IM ESG Standards available on www.axa-im.com/en/responsible-investing.The Sub-Fund may invest up to 10% of net assets in UCITS and/or UCIs.Within 200% of the Sub-Fund's assets, the investment strategy may be achieved by direct investments and/or through derivatives. Derivatives may also be used for hedging purposes.Dividend Policy: The Fund will be managed with the objective to deliver an annual dividend comprised between 2% and 6% which will be capitalized (for Capitalisation Shares) or distributed (for Distribution Shares), subject to market conditions. Payment of distributions (including those paid out of the Sub-Fund's capital) may reduce the value of your holding and impact the potential for long term capital growth.

Risk

Synthetic Risk & Reward Information scale

1 2 SRRI Value 3 4 5 6 7

The risk category is calculated using historical performance data and may not be a reliable indicator of the Sub-Fund's future risk profile. The risk category shown is not guaranteed and may shift over time. The lowest category does not mean risk free.

Why is this Fund in this category?

The capital of the Sub-Fund is not guaranteed. The Sub-Fund is invested in financial markets and uses techniques and instruments which are subject to some levels of variation, which may result in gains or losses.

Additional risks

Credit Risk: Risk that issuers of debt securities held in the Sub-Fund may default on their obligations or have their credit rating downgraded, resulting in a decrease in the Net Asset Value. Liquidity Risk: risk of low liquidity level in certain market conditions that might lead the Sub-Fund to face difficulties valuing, purchasing or selling all/part of its assets and resulting in potential impact on its net asset value. Counterparty Risk: Risk of bankruptcy, insolvency, or payment or delivery failure of any of the Sub-Fund's counterparties, leading to a payment or delivery default. Impact of any techniques such as derivatives: Certain management strategies involve specific risks, such as liquidity risk, credit risk, counterparty risk, legal risk, valuation risk, operational risk and risks related to the underlying assets.The use of such strategies may also involve leverage, which may increase the effect of market movements on the Sub-Fund and may result in significant risk of losses.

Investment horizon

This Sub-Fund may not be suitable for investors who plan to withdraw their contribution within 5 years.

Main documents

KIID EN 13/11/2019

KIID FR 04/11/2019

Prospectus EN 07/10/2019

Prospectus FR 24/10/2019

Fund manager comment : 31/12/19

December 2019 Uncertainty declined again in December with the “phase one” trade agreement between the US and China and the victory of the conservative party in the UK election. Business surveys validated the stabilisation of activity in the major economies. The United States and China finally announced a "phase one" trade agreement that eliminated the prospect of tariff increases on Chinese imports in December. Manufacturing sector surveys increasingly showed signs of stabilisation. In addition, the latest payrolls surprised to the upside with employment posting its largest monthly increase since January while the unemployment rate fell to a five decade low at 3.5%. The Federal Reserve left its monetary policy unchanged at its last meeting of the year while making a point that it would remain accommodative. Meanwhile, American domestic politics remains fraught as the House of Representatives voted to impeach President Trump although it is unlikely that this will be validated by the Republican controlled Senate. In the euro area, there’s been an improvement in the latest data, although it remains quite weak. The composite PMI index rose slightly in December to 50.9 in November. Nevertheless, contagion from the manufacturing sector to the domestic sector appears to be underway as service sector PMIs are on track to post their lowest quarterly average since 2014. On the trade side, the US administration recently threatened to impose a 100% duty on $2.4 billion of French products in response to France's new digital tax. There was no change to the ECB’s monetary policy at Christine Lagarde first press conference while the latest Eurosystem forecasts of weak growth (+1.1%) in 2020 justifying the ECB's easing plan. In the United Kingdom, the December elections confirmed Boris Johnson as Prime Minister, with an even greater majority than suggested by the polls. The government is thus expected to quickly pass the Withdrawal Agreement bill which would allow the UK to leave the EU before the Article 50 extension expires on January 31st. However, uncertainty surrounding Brexit is likely to persist as the Conservatives pledge not to extend the transition phase, in order to negotiate new trade agreements, beyond 2020. In Asia, Japanese 3rd quarter GDP growth was revised upwards to +1.8% (annual rate) given higher consumption ahead of the VAT increase. Nevertheless, growth is expected to fall in the 4th quarter, as suggested by retail sales which fell by -14.4% in October. A further fiscal stimulus was approved to mitigate the negative impact of the VAT hike and damage caused by typhoons. Meanwhile, the Bank of Japan maintained the status quo at its last monetary policy meeting. In China, data improved slightly with the PMI-manufacturing indices rebounding above 50. In terms of trade, exports improved and imports picked up as domestic demand firmed. The recent medium-term loan facility rate cut allowed for a credit boost to activity while on the fiscal side, new bond issuance should support infrastructure spending in 2020. Better than expected economic data and higher risk appetite buoyed most equity markets in December. In the United States, the S&P 500 index moved up +2.9% and in Europe, the Eurostoxx 50 increased +1.1% with the French CAC up 1.2% although the German DAX was stable (+0.1%). Peripheral markets moved up in line with the broader market as indicated by the Italian MIB up +1.1% and the Spanish IBEX rising +2.1%. In the United Kingdom, the FTSE 100 increased +2.7% following the Tory victory. Asian markets also reacted positively with Japan’s Nikkei and Topix increasing +1.6% and 1.3% respectively. Chinese markets rebounded strongly in reaction to the “phase one” deal with Hong Kong's Hang Seng Index jumping +7% and the Shanghai Composite increasing +6.2%. Emerging markets (MSCI EM Total Return Index) also rose sharply up +7.5% in USD compared to +5.6% in EUR. Most sovereign bond markets remained under pressure given the improving economic backdrop and the lack of any monetary policy catalyst on the part of the major central banks. US 10-year yields rose to 1.92%. German 10 year Bund yields also moved higher to -0.19% and French 10-year OAT yields increased back into positive territory at 0.12%. Spanish 10 year yields rose marginally to 0.47% while Italian 10-year BTP yields rose more steeply to 1.41%. The yield on 10 year British Gilt increased slightly to +0.82%. Japanese 10 yields rose modestly to -0.01%. With regards to Credit markets, Corporate Investment Grade Credit spreads narrowed slightly on either side of the Atlantic but even more so for European and in particular US High Yield. With regards to currency markets, the US dollar depreciated slightly as indicated by the dollar index which declined -1.9%. The Euro appreciated +1.9% to 1.12 and the British pound strengthened +2.6% to 1.32 while the Japanese Yen appreciated merely +0.8% to 108 against USD. On commodity markets, the Bloomberg Commodities Index excluding agriculture and livestock rose +5.1%. Oil prices reacted very positively to OPEC’s new production cuts and the inventory draw in the US (Brent rose +8.3% to $66 a barrel while WTI increased +10.7% to $61). Industrial metals, as indicated by the Copper price up +5.3%, were lifted by the “phase one” trade accord while the weaker dollar pushed Gold +3.6% higher to $1,523 an ounce. Over the month under review, the fund further reinforced its allocation to equity markets with purchases of index futures on the S&P 500 and MSCI Emerging Markets. The overall positioning on risk is thus overweight equities as, despite some volatility in US macro numbers of late, we continue to expect a late cycle recovery into 2020 as the global economy benefits from the effects of policy easing and the improvement in investor sentiment having seen a marked thaw in US-China trade relations whilst macro numbers in both Europe and China have improved. The duration position of the portfolio was increased over the month whilst the fund also profited from the day to day volatility to take shorter-term tactical positions. At month end, once profits were taken, the duration position was 9% above that of the long-term strategic level. The fund currently is positioned with an 84% allocation to income generating assets and 18% to long term growth strategies whilst exposure to duration was increased through futures contracts on German and US interest rate markets.

Performance

Performance chart

Period

1M
3M
6M
1Y
3Y
5Y
8Y
10Y
YTD
Since launch

Start date

End date

Past performance is not a reliable indicator as to future performance.
Performance calculations are net of management fees. Performance are shown as annual performance ( 365 days). In the case where the currency of the investor is different from the Fund’s reference currency the gains are capable of varying considerably due to the fluctuations of the exchange rate.

Benchmark

Performance indicator Start date End date
- - -

Performance table

End date

Performance table Net performance Performance indicator  Start date End date
- - - - -
1M - - - -
3M - - - -
6M - - - -
YTD - - - -
1Y - - - -
3Y - - - -
5Y - - - -
10Y - - - -
Since launch - - - -
1y - - - -
3y - - - -
5y - - - -
10y - - - -
Since launch - - - -
Y-1 - - - -
Y-3 - - - -
Y-5 - - - -

Risk table

End date

Risk table Fund volatility Benchmark volatility Tracking error Information ratio Sharpe ratio Beta Alpha
1M - - - - - - -
QTD - - - - - - -
3M - - - - - - -
6M - - - - - - -
YTD - - - - - - -
1Y - - - - - - -
3Y - - - - - - -
5Y - - - - - - -
8Y - - - - - - -
10Y - - - - - - -
Since launch - - - - - - -

Price table

Start date

End date

Price Date Portfolio AUM
- - -

NAV

First NAV date 28/10/13

Administration

Distribution country

Distribution countries
Denmark
Finland
France
Germany
Italy
Luxembourg
Netherlands
Norway
Spain
Sweden
Switzerland
United Kingdom

Fees

Ongoing Charges 0.86%
Management fees 0.60%

Fund facts

Currency EUR
Start date 28/10/13
Asset class MULTI-ASSET
Expertise Total Return & Allocation
Range AXA World Funds
Legal country Luxembourg
Custodian State Street Bank Luxembourg S.C.A
Asset manager AXA INVESTMENT MANAGERS PARIS S.A.
Depositary State Street Bank Luxembourg S.C.A
Legal asset manager AXA Funds Management SA (Luxembourg)

Portfolio management

Fund Manager Andrew ETHERINGTON
Co-manager Goran JEVTIC
Investment team MT Asset Allocation

Structure

Investment area Global
Legal form SICAV

Subscription and redemption

The subscription, conversion or redemption orders must be received by the Registrar and Transfer Agent on any Valuation Day no later than 3 p.m. Luxembourg time. Orders will be processed at the Net Asset Value applicable to the following Valuation Day. The investor's attention is drawn to the existence of potential additional processing time due to the possible involvement of intermediaries such as Financial Advisers or distributors.The Net Asset Value of this Sub-Fund is calculated on a daily basis.

Literature