SICAV (UCITS compliant)

L&G Euro Corporate Bond (Responsible Exclusions) Fund

Given current market events we have now populated Fund Centre with Fund exposures to assets with “country of risk*” as either Russia, Ukraine, or Belarus, or exposures to Russian Rouble currency. Please see the exposures below for further information.

*Sourced from Bloomberg

Fund facts

Fund size
€373.5m
Base currency
EUR
Launch date
21 Oct 2019
Domicile
Luxembourg
Share class launch

Statistics

As at 31 May 2022

Fund aim

The objective of the Fund is to provide a combination of growth and income by outperforming the Markit iBoxx Euro Corporates Total Return index, the "Benchmark Index". The Fund aims to outperform the Benchmark Index by 0.5% per annum. This objective is before the deduction of any charges and measured over rolling three year periods.The Fund will generate investment return whilst excluding companies on the Responsible Exclusions list. The exclusion criteria applied to generate this list, is detailed in the investment policy.

Benchmark

Markit iBoxx Euro Corporates Total Return Index

  • What does it invest in? Invests in a broad range of bonds and bond-related instruments denominated in Euro, Sterling and US Dollar, with at least 70% invested in a portfolio of Euro denominated bonds. Invests at least 70% in corporate bonds.
  • How does it invest? Actively managed, investing primarily in fixed income securities with an investment grade (lower risk) credit rating. May also invest in debt with a sub-investment grade (higher risk) credit rating on a limited basis, as well as derivative instruments. Will exclude companies on the Responsible Exclusions list described on the fund's Key Investor Information Document.
  • Does it promote sustainability characteristics? The Fund promotes a range of environmental and social characteristics. Further information on how such characteristics are met by the Fund can be found in the Supplement.

Russia exposure

23 Feb 2022
0.00%
29 Apr 2022
0.00%

As at 29 Apr 2022

These numbers give indicative Fund exposures to assets with “country of risk” sourced from Bloomberg as either Russia, Ukraine, or Belarus, or exposures to Russian Rouble currency. The figures are based on early price estimated data so may differ from the fully verified month end NAV exposure. Where the holding is “indirect” (for example held in a sub-fund), best efforts have been made to ensure that exposure to the sub-fund(s) is on a consistent basis. As at dates have been chosen to reflect exposure both before and after the significant recent falls in values of impacted assets.

Exposures are presented to two decimal places, exposures may be rounded to 0 if less than 0.05%.

These exposures do not give an indication of the relative exposures versus the benchmark. With regard to index-based strategies, LGIM has a duty to track the relevant index to ensure clients receive exposure as set out in the relevant investment objective. Following the imposition of sanctions and assets being removed from indices the market was effectively frozen for foreign investors and all equity positions have been marked to zero in line with LGIM’s fair value pricing policy. Regardless of being priced at zero LGIM funds still own these securities and any value realised in the future will be for the sole benefit of the relevant fund. LGIM will seek to divest from such securities at such a time that market conditions allow consistent with our fiduciary duties and applicable sanctions.

Fund updates

Performance

Source: Lipper

Performance (%)
Select period:
Change

    Performance summary (%)

    As at 31 May 2022

    CumulativeFundBenchmark
    1 month-1.37-1.28
    6 months-8.64-9.27
    Year to date-8.44-9.17
    3 years--
    5 years--
    Since launch-5.72-7.91
    AnnualisedFundBenchmark
    1 year-8.37-9.33
    3 years--
    5 years--
    Since launch-2.24-3.12

    As at 31 Mar 2022

    CumulativeFundBenchmark
    Quarterly-4.79-5.36
    Year to date-4.79-5.36
    3 years--
    5 years--
    Since launch-1.96-4.05
    AnnualisedFundBenchmark
    1 year-4.82-5.66
    3 years--
    5 years--
    Since launch-0.81-1.68
    Rolling 12-month performance
    Calendar year performance
    Monthly performance
    Annualised performance

    Rolling 12-month performance to last quarter end (%)

    12 months to 31 March 2018 2019 2020 2021 2022
    Fund---9.12-4.82
    Benchmark---8.68-5.66

    Calendar year performance (%)

    2017 2018 2019 2020 2021
    Fund---3.90-0.69
    Benchmark---2.73-1.08

    Monthly performance (%)

    Annualised performance (%)

    1 year3 years5 yearsSince launch
    Fund-8.37---2.24
    Benchmark-9.33---3.12

    Annualised performance (%)

    1 year3 years5 yearsSince launch
    Fund-4.82---0.81
    Benchmark-5.66---1.68

    Performance for the I EUR Acc unit class in EUR, launched on 24 October 2019. Source: Lipper.

    Past performance is not a guide to the future.

    Performance for the K EUR Acc unit class in EUR, launched on 21 October 2019. Source: Lipper.

    Past performance is not a guide to the future.

    Performance for the R EUR Acc unit class in EUR, launched on 07 October 2020. Source: Lipper.

    Past performance is not a guide to the future.

    Performance for the Z EUR Acc unit class in EUR, launched on 24 October 2019. Source: Lipper.

    Past performance is not a guide to the future.

    Portfolio

    As at 31 May 2022. All data source LGIM unless otherwise stated. Totals may not sum due to rounding.

    Currency (%)

    EUR96.0
    GBP2.6
    USD1.4
    Top 10 issuers20.8
    Rest of portfolio79.2
    No. of issuers149

    Top 10 issuers (%)

    Bundesrepublik Deutschland3.7
    BNP Paribas2.5
    UBS AG2.0
    Morgan Stanley2.0
    Bank of America Corporation1.9
    KBC Groep1.9
    Groupe BPCE SA1.8
    Verizon Communications Inc1.7
    Societe Generale SA1.7
    Jyske Bank1.6

    Credit rating (%)

    FundBenchmarkRelative
    AAA4.30.34.0
    AA2.44.0-1.5
    A33.635.6-2.0
    BBB53.659.2-5.5
    BB5.51.04.5
    Cash0.5-0.5

    Top sector over/underweights (%)

    FundBenchmarkRelative
    Banks38.928.910.0
    Sovereign3.7-3.7
    Consumer Services6.83.73.1
    Financial Services5.12.62.5
    Covered1.1-1.1
    Telecommunications6.55.80.7
    Utilities10.49.80.5
    Cash and Equivalents0.5-0.5
    Insurance3.44.3-0.9
    Health Care5.06.1-1.0
    Real Estate4.86.2-1.4
    Oil & Gas2.04.6-2.6
    Basic Materials-2.6-2.6
    Industrials6.59.1-2.6
    Technology-2.8-2.8
    Consumer Goods5.313.5-8.2

    Fund Managers

    Lan is a euro credit portfolio manager in the Pan European Credit team, having joined LGIM in September 2010 as assistant to the fund manager. Previously Lan was at Hedge Funds Investment Management where she worked as a part-time research analyst in their Investment team. Prior to this, Lan completed internships with China Lion Securities in China, in their investment banking department, and with UBS, London where she worked in their fixed income, currencies and commodities division. Lan holds a MMath in mathematics and statistics from Oxford University as well as an MSc in finance at Imperial College London. Lan is a CFA charterholder.

    Marc is head of the Euro credit portfolio management team. He joined LGIM in May 2012 as a portfolio manager in the Pan European Credit team. Marc previously spent 12 years at Blackrock, first as a senior portfolio manager within Philips Investment Management in Eindhoven and then as Director, Investment Manager in London, where he was responsible for the non-financials management of investment grade portfolios and was a portfolio manager for two Asian credit portfolios. Marc started in the industry in 1995 as a portfolio manager at ABP investments (now APG). He graduated from Tilburg University, Netherlands with an MSc in economics and is a Certified European Financial Analyst (CEFA).

    LanWu

    MarcRovers

    Sustainability

    Sustainability disclosures

    The Sustainable Finance Disclosure Regulation (SFDR) is an EU regulation that came into force on 10 March 2021, and imposes disclosure requirements for EU financial products. These requirements include disclosing sustainability-related information for funds that (i) promote (among other characteristics) environmental or social characteristics (Article 8 products), or (ii) have a sustainable investment objective (Article 9 products), both as defined under SFDR.

    SFDR categorisation: Article 8Article 8: These funds promote environmental and/or social characteristics

    The EU Taxonomy Regulation (EU Taxonomy) sets out a classification system in respect of environmentally sustainable economic activities. EU Taxonomy covers six environmental objectives, ranging from climate change mitigation to protection and restoration of biodiversity, with technical screening criteria to determine whether certain economic activities supports these objectives. EU Taxonomy recognises these economic activities as green, or “environmentally sustainable” if they make a substantial contribution to at least one of the environmental objectives, while at the same time not significantly harming any of these objectives and meeting minimum social safeguards. EU Taxonomy came into force on 1 January 2022 for the first two, climate-related, environmental objectives. EU Taxonomy also amends the disclosure obligations under SFDR to extend the information to be disclosed for Article 9 products and Article 8 products with an environmental focus. You will find the relevant disclosures under the ‘Pre-contractual disclosure’ tab.

    The Fund promotes a range of environmental and social characteristics as described below. These characteristics are met by:

    Net zero framework
    Stock selection
    Carbon intensity
    Future World Protection List
    Climate Impact Pledge
    Exclusions

    Companies are excluded from the Fund in accordance with the following Responsible Exclusions criteria

    • Companies that derive 50% or more of their revenues (as a % of their balance sheet) from coal mining or extraction are excluded from the Fund.
    • Companies that are in breach of at least one of the United Nation Global Compact principles for a continuous period of three years (36 months) or more are considered persistent violators and are excluded.
    • Companies involved in controversial weapons are also excluded. These exclusions, however, did not form the rationale for the article 8 categorisation.

    The Responsible Exclusions list is monitored on an on-going basis and updated on an annual basis. In order to determine the list of companies included on the Responsible Exclusion List, we use data from a number of external ESG data providers.

    Tilting
    Paris-aligned benchmark optimisation
    ESG integration

    Our ESG integration encompasses both top-down and bottom-up approaches to identify and assess ESG factors in the research analysis process. The top-down research analysis identifies long-term, thematic shifts and structural changes which help determine the resiliency of sectors and the companies within them. The bottom-up analysis uses a proprietary, company analysis tool called Active ESG View which provides information on the ESG credentials of companies.

    • Our Active ESG View tool forms an essential component of this overall active research process. The tool brings together granular quantitative and qualitative inputs in order to reflect a full picture of the ESG risks and opportunities embedded within each company.
    • Active ESG View combines ESG raw data with qualitative assessment capturing ESG insights from our company analysis and engagements.
    • The ESG analysis starts with third-party data from multiple different vendors which includes hundreds of ESG metrics (including data on carbon emissions, water and waste, environmental policies and controls, labour, health and safety, bribery and corruption) spanning 64 specific sectors and/or sub-sectors from a number of ESG data providers.
    • Our Global Research and Engagement Groups (GREG), which is made up of Investment Stewardship and investment teams, have established a proprietary materiality matrix using such data which seeks to identify financially material topics for a given industry. The materiality matrix brings structure to our research and a framework to help systematically define and prioritise our engagement activity across the firm.
    • The GREGs review the ESG data within the Active ESG View tool for each sector in order to increase or decrease weightings for each environmental, social and/or governance factor within the tool with the aim to create an overall assessment.

    Active ESG View is an integral feature of this fund and the outputs of Active ESG View must be taken into account for all investment decisions.

    Active engagement is a vital pillar within our approach to ESG integration. In practice, the data alone may not tell the full story, which is why we believe that incorporating a qualitative element is essential in order to fully capture the ESG risks embedded within each company. Our qualitative inputs capture ESG insights leveraging on the extensive knowledge of our various research.

    UN SDG alignment

    A description of the extent to which the environmental and social characteristics are met will likely be made available as part of the annual report published in 2022 as required by SFDR. The Fund’s most recent annual report does not include any information pursuant to SFDR.

    Pre-contractual disclosure

    SFDR Disclosure

    The Fund promotes a range of environmental and social characteristics. The Fund seeks to meet these characteristics by;

    (i) investing in bonds and bond related instruments issued by companies which meet the Investment Manager’s core pillars of ESG integration (as further described below); and

    (ii) excluding investments in bonds issued by companies involved in nuclear weapons or firearms. In addition, the Fund restricts investment in bonds of companies who derive more than 50% of their revenues from the production of tobacco or coal, or that are United Nations Global Compact violators. The above exclusions form the Responsible Exclusions list which is reviewed annually.

    Evaluating positive ESG factors is an integral part of the Fund’s investment process. The Investment Manager’s integrated framework for responsible investing across both public and private assets is primarily based on stewardship with impact and collaborative active research across asset classes. As part of the investment research process, material ESG factors are identified using both top-down and bottom-up approaches. The top-down research analysis performed by the Investment Manager’s sector experts, in conjunction with its investment stewardship teams; help determine the resiliency of sectors and the companies within them. ESG factors are also fully embedded into the bottom-up research process which involves evaluating the ESG credentials of companies that the Investment Manager considers for investment, alongside traditional financial metrics. The Investment Manager has developed a proprietary research tool called ESG Active View which brings together these granular quantitative and qualitative inputs by evaluating sector-specific ESG factors. The ESG Active View provides an overview of how companies manage potential, sector-specific ESG risks and opportunities, so that these can be considered alongside all other components of fundamental investment analysis.

    In addition to the above, active engagement with the issuers is used as a tool to drive progress and influence positive change and is conducted independently and in collaboration with industry peers and broader stakeholders. Engagement activities normally focus on specific material ESG issues and involve formulating an engagement strategy with regard to such issues with the aim to track and review the progress of the issuers during this process. The Investment Manager also provides regular reporting on the outcomes of its engagement. This can be made available on request or can be found at: www.lgim.com. Together, these activities enable the Investment Manager to conduct engagement that drives positive change and to deliver integrated investment solutions

    The Investment Manager finally aims to ensure that (where applicable) the issuers in which the Fund is invested follow good governance practices by 1) setting its expectations with issuers' management with regard to good governance practices; 2) actively engaging with the issuers; and 3) supporting policymakers and legislators to ensure there is strong regulation and standards.

    EU Taxonomy Disclosure

    While the Fund promotes environmental and social characteristics within the meaning of Article 8 of the SFDR, it does not currently commit to investing in any “sustainable investments” within the meaning of the SFDR. Accordingly, it should be noted that the investments underlying this Fund do not take into account the EU criteria for environmentally sustainable economic activities within the meaning of the Taxonomy Regulation and, as such, the Fund’s portfolio alignment with the Taxonomy Regulation is not calculated.

    Governance practices

    The ways in which we ensure that investee companies follow good governance practices are set out below.

    Setting expectations

    A number of policies and processes guide the engagement activities, set out the approach to investment stewardship, and outline the expectations of investee issuers. The Global Corporate Governance and Responsible Investment Principles set out the approach and expectations with respect to key topics that are essential for an efficient governance framework, and for building a sustainable business model. We expect all issuers on a global scale to closely align with our principles which set out the fundamentals of corporate governance. We also take into account market specificities and take a tailored approach to voting on some topics in various markets. Further related policies can be found on the Investment Stewardship section of the LGIM website.

    Active engagement

    Active engagement with the issuers is used as a tool to drive progress and influence positive change and is conducted independently and in collaboration with industry peers and broader stakeholders. Engagement activities normally focus on specific material ESG issues and involve formulating an engagement strategy with regard to such issues with the aim to track and review the progress of the issuers during this process.

    Voting
    Supporting policymakers and legislators

    LGIM's Investment Stewardship team actively engages with policy makers and legislators to ensure there is strong regulation and standards in regards to governance practices.

    Literature

    Trading information

    Prices

    Name
    I EUR Acc
    Mid price
    90.97c
    Change (%)
    -
    Currency
    EUR
    Price time
    16:00 CET
    Name
    R EUR Acc
    Mid price
    89.46c
    Change (%)
    -
    Currency
    EUR
    Price time
    16:00 CET
    Name
    K EUR Acc
    Mid price
    91.49c
    Change (%)
    -
    Currency
    EUR
    Price time
    16:00 CET
    Name
    Z EUR Acc
    Mid price
    91.67c
    Change (%)
    -
    Currency
    EUR
    Price time
    16:00 CET

    Further details

    Costs

    Price basis
    Single swing
    Initial charge
    0.00%
    Ongoing charges figure
    0.36%
    Dilution adjustment
    0.432%- round trip
    Swing factor
    0.216%

    Codes

    ISIN
    LU2050551006
    SEDOL
    BKDYQ22
    Bloomberg
    LGECPIE LX
    MEX
    -

    Dealing information

    Valuation frequency
    Daily, 16:00 CET
    Dealing frequency
    Daily
    Settlement period
    T+3
    Administrator/Custodian
    Northern Trust

    Country registration

    This share class is registered for sale in the following countries:

    For valuations and account queries contact:

    Legal & General ICAV
    Northern Trust International Fund Administration Services (Ireland) Limited
    City East Plaza - Block A
    Towlerton
    Ballysimon Road
    Limerick
    Ireland
    V94 X2N9
    Fax: +353 1 434 5293
    Telephone: +353 1 434 5080
    Email: [email protected]

    Legal & General SICAV
    Northern Trust Global Services SE
    10 Rue du Château d'Eau
    L-3364 Leudelange
    Grand-Duché de Luxembourg
    Facsimile: +352 28 294 454
    Telephone: +352 28 294 123
    Email: [email protected]

    Key risks

    The value of an investment and any income taken from it is not guaranteed and can go down as well as up, you may not get back the amount you originally invested.

    Past performance is no guarantee of future results.

    This fund holds bonds that are traded through agents, brokers or investment banks matching buyers and sellers. This makes the bonds less easy to buy and sell than investments traded on an exchange. In exceptional circumstances the fund may not be able to sell bonds and may defer withdrawals, or suspend dealing. The Directors can only delay paying out if it is in the interests of all investors and with the permission of the fund depositary.

    The fund invests directly or indirectly in bonds which are issued by companies or governments. If these companies or governments experience financial difficulty, they may be unable to pay back some or all of the interest, original investment or other payments that they owe. If this happens, the value of the fund may fall.

    Prices of the ABS/MBS may be volatile, and will generally fluctuate due to a variety of factors that are inherently difficult to predict. In addition, the terms of the ABS/MBS may restrict its sale in particular circumstances.

    Derivatives are highly sensitive to changes in the value of the asset on which they are based and can increase the size of losses and gains.

    The fund may have underlying investments that are valued in currencies that are different from sterling (British pounds). Exchange rate fluctuations will impact the value of your investment. Currency hedging techniques may be applied to reduce this impact but may not entirely eliminate it.

    We may take some or all of the ongoing charges from the fund's capital rather than the fund's income. This increases the amount of income, but it reduces the growth potential and may lead to a fall in the value of the fund.

    Investment returns on bonds are sensitive to trends in interest rate movements. Such changes will affect the value of your investment.

    Important information

    This information is intended for investment professionals only and is for information purposes only. It should not be distributed without our permission.

    No investment decisions should be made without first reviewing the key investor information document and prospectus (and any supplements thereto) of the relevant product which includes information on certain risks associated with an investment.

    Unless otherwise agreed in writing, the Information on this website (a) is for information purposes only and we are not soliciting any action based on it, and (b) is not a recommendation to buy or sell securities or pursue a particular investment strategy; and (c) is not investment, legal, regulatory or tax advice. Any trading or investment decisions taken by you should be based on your own analysis and judgment (and/or that of your professional advisers) and not in reliance on us or the Information.

    This information is only directed at investors resident in jurisdictions where each fund is registered for sale. It is not an offer or invitation to persons outside of those jurisdictions. We reserve the right to reject any applications from outside of such jurisdictions.

    All information detailed on this website is current at the time of publication and may be changed in the future.

    Source and third party data

    Source: Unless otherwise indicated all data contained on this website is sourced from Legal & General Investment Management Limited.

    Where this document contains third party data ('Third Party Data’), we cannot guarantee the accuracy, completeness or reliability of such Third Party Data and accept no responsibility or liability whatsoever in respect of such Third Party Data

    Issuer

    Issued by LGIM Managers (Europe) Limited as management company for this fund. Registered in Ireland No. 609677. Registered Office: 33/34 Sir John Rogerson’s Quay, Dublin, 2, Ireland. Authorised and Regulated by the Central Bank of Ireland No. C173733.

    Legal & General Investment Management Limited has been appointed as the discretionary investment manager for these Funds and is Registered in England and Wales No. 02091894. Registered Office: One Coleman Street, London, EC2R 5AA, United Kingdom. Authorised and regulated by the Financial Conduct Authority, No. 119272.

    Index disclaimer

    Neither Markit, its Affiliates or any third party data provider makes any warranty, express or implied, as to the accuracy, completeness or timeliness of the data contained herewith nor as to the results to be obtained by recipients of the data. Neither Markit, its Affiliates nor any data provider shall in any way be liable to any recipient of the data for any inaccuracies, errors or omissions in the Markit data, regardless of cause, or for any damages (whether direct or indirect) resulting therefrom. Markit has no obligation to update, modify or amend the data or to otherwise notify a recipient thereof in the event that any matter stated herein changes or subsequently becomes inaccurate. Without limiting the foregoing, Markit, its Affiliates, or any third party data provider shall have no liability whatsoever to you, whether in contract (including under an indemnity), in tort (including negligence), under a warranty, under statute or otherwise, in respect of any loss or damage suffered by you as a result of or in connection with any opinions, recommendations, forecasts, judgments, or any other conclusions, or any course of action determined, by you or any third party, whether or not based on the content, information or materials contained herein. Copyright © 2022, Markit Indices GmbH.