Citywire Pan European Investment Conference May 2012 Fairmont Le Montreux Palace, 9 th – 11 th May 2012 Jupiter Dynamic Bond SICAV FOR PROFESSIONAL INVESTORS ONLY. NOT FOR RETAIL INVESTORS. Presented by: Ariel Bezalel, Fund Manager Fixed Interest Team & Fund Management Director Evelyn Lederle, Senior Sales Manager, Switzerland Daniel Blum, Sales Manager, Europe
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Citywire Pan European Investment Conference
May 2012
Fairmont Le Montreux Palace, 9th – 11th May 2012
Jupiter Dynamic Bond SICAV
FOR PROFESSIONAL INVESTORS ONLY. NOT FOR RETAIL INVESTORS.
Presented by:
Ariel Bezalel, Fund Manager Fixed Interest Team & Fund Management Director
Evelyn Lederle, Senior Sales Manager, Switzerland
Daniel Blum, Sales Manager, Europe
Agenda
Jupiter
People
Investment philosophy
Process
Performance
Manager’s current thinking
Valuations – Credit Still Appealing
Stock Examples
1
Mutual Funds, £18,351m
Segregated Mandates, £3,493m
Private Clients, £1,757m
Investment Trusts, £576m
Introduction to Jupiter
Assets under management Established in 1985
424 employees including
65 Investment Professionals
One of Europe’s most successful and
respected fund management houses,
managing assets of £24.2bn
Market cap £1.1bn*
Source: Jupiter 31.03.12. *Source: Bloomberg as at 31.03.12.
2
Industry recognition
Jupiter’s range of awards –
over 100 in the last 5 years alone –
is a testament to our company-wide
performance record*
Jupiter’s asset management success…
Talented team
Investment philosophy
Fundamental investment approach
*Source: Jupiter, Includes Jupiter Unit Trust Managers Limited and Jupiter Asset Management Limited. Past performance is no guide to the future.
3
Our core investment beliefs
Individual accountability and information sharing
Leads to high conviction ideas
Avoids biases of committees
Freedom to invest
Not restricted by house views or model portfolios
Able to back individual judgements
Portfolio risk controls
Independent, in-house monitoring – Performance and Portfolio Analytics team
Source: HSBC 29.02.12, Institutional class. Yields quoted are not guaranteed and may change in the future. *Source : Jupiter 29.02.12. **Source: Jupiter as at 31.03.12. ***Sector requirement
15
16
Portfolio features of the UK-domiciled bond fund
Source: Jupiter, 2012.
2
3
4
5
6
Jun 08 Sep 08 Dec 08 Mar 09 Jun 09 Sep 09 Dec 09 Mar 10 Jun 10 Sep 10 Dec 10 Mar 11 Jun 11 Sep 11 Dec 11 Mar 12
Ye
ars
AverageDuration
Change in duration since launch
Source: Jupiter as at 29.02.12. The fund manager has the power to use derivatives but it is intended that these will only be used for efficient portfolio management and not for investment purposes.
17
Portfolio features – Exploiting opportunities across the ratings spectrum
Strategic asset allocation since launch Credit rating split
Source: Jupiter as at 29.02.12. The fund manager has the power to use derivatives but it is intended that these will only be used for efficient portfolio management and not for investment purposes.
Agenda
Jupiter
People
Investment philosophy
Process
Performance
Manager’s current thinking
Valuations – credit still appealing
Stock examples
19
Track record – UK-domiciled bond fund
Ranked 2nd in sector since launch (02.06.08)
Source: FE, GBP, bid to bid, net income reinvested to 31.03.12. Fund launched 02.06.08. Ranked 2 / 55 in IMA Sterling Strategic Bond sector since launch. Past performance is no guide to the future.
20
-30
-20
-10
0
10
20
30
40
50
60
Jun 08 May 09 Apr 10 Mar 11 Mar 12
% G
row
th
UK-domiciled bond fund GB 53.35 IMA Sterling Strategic Bond TR in GB 23.71
Track record: UK-domiciled bond / equity fund – fixed income component
Source: Jupiter, offer to offer to 31.12.11. Assumes TER of 1.75%. Past performance is no guide to the future.
21
80
90
100
110
120
130
140
Nov 06 Jun 07 Jan 08 Aug 08 Mar 09 Oct 09 May 10 Dec 10 Jul 11
UK-domiciled bond / equity fund 127.9 Iboxx Non Gilt Index 124.0
Track record – UK-domiciled bond fund
Performance
Source: FE, bid to bid, net income reinvested to 31.03.12. Fund launched 02.06.08. Past performance is no guide to the future.
Cumulative 1 year % Since launch %
UK-domiciled bond fund 6.4 53.4
IBOXX Stg Non Gilts All Maturities 8.8 30.5
IMA Sterling Strategic Bond sector average 5.1 23.7
Sector ranking 21 / 68 2 / 55
Discrete years 2009 % 2010 % 2011 %
UK-domiciled bond fund 42.5 11.2 4.5
IBOXX Stg Non Gilts All Maturities 10.8 8.4 6.9
IMA Sterling Strategic Bond sector average 20.8 8.1 2.7
Sector ranking 3 / 57 11 / 63 21 / 68
22
Track record – UK-domiciled bond fund
Monthly returns since launch
Source: FE, bid to bid, net income reinvested 30.06.08 to 31.03.12. Fund launched 02.06.08. The fund manager has the power to use derivatives but it is intended that these will only be used for efficient portfolio management and not for investment purposes
23
-10
-8
-6
-4
-2
0
2
4
6
8
Jun 08 Nov 08 Apr 09 Sep 09 Feb 10 Jul 10 Dec 10 May 11 Oct 11 Mar 12
% G
row
th
UK-domiciled bond fund IMA Sterling Strategic Bond TR in GB
Appendix
Portfolio thoughts – where are we now: the debt-equity clock
25
Source: Morgan Stanley Equity & Credit Strategy.
0
500
1000
1500
2000
2500
Dec 99 Dec 01 Dec 03 Dec 05 Dec 07 Dec 09 Dec 11
US High Yield European High Yield
EUR & USD HY benchmark spreads
Portfolio thoughts – high yield pricing in decent downturn in economic growth
Source: Bloomberg, JP Morgan as at 16.03.12. The above commentary represents the views of the Fund Manager at the time of the presentation and may be subject to change in the future, particularly during periods of rapidly changing market circumstances.
High yield still pricing
in a slowdown
Geographic exposure still
important here. Top down
macro fundamentals for
much of Europe still poor
Subordination continues
to be important. Still have
preference for secured
debt but parts of this
market now look rich
900bps is the magic number
26
Jupiter’s fixed income team
John Hamilton Fund Management Director,
Jupiter Asset Management Ltd.
Current role Head, Fixed Interest Team
Current
responsibilities
Manager of two UK-domiciled bond funds and
institutional assets
1991 – Jupiter Asset Management
Head, Fixed Interest Team
1987 – 1 991 Tyndall Investment Management Ltd.
Director and Fund Manager, Fixed Interest
1981 – 1987 London Life Association
Manager, Fixed Interest
1979 – 1981 Laurie Millbank
Gilt-edged department
Qualifications Mathematics (London University)
Ariel Bezalel Fund Manager, Fixed Interest
Team
Fund Management Director
Current role Fund Manager
Current
responsibilities
Manager of UK-domiciled bond fund and fixed interest
component of two UK-domiciled bond/equity funds
1999 – Jupiter Asset Management
Fund Manager, Fixed Interest Team
1998 – 1999 Jupiter Asset Management
Assistant Fund Manager, Fixed Interest Team
Qualifications Economics (Middlesex University)
27
Jupiter’s fixed income team
Rhys Petheram Fund Manager,
Jupiter Asset Management Ltd.
Nicole Weiss Credit Analyst,
Jupiter Asset Management Ltd.
Current role Fund Manager / Credit Analyst
Current
responsibilities
Co-Manager of UK-domiciled bond fund and Manager
of the Fixed Income portion of UK-domiciled
bond/equity fund
2010 – Jupiter Asset Management
Fund Manager
2006 – 2010 Jupiter Asset Management
Assistant Fund Manager
2004 – 2006 Moody’s Investor Services
Credit Analyst, Utilities
2001 – 2004 Towers Perrin Australia (acquired by Frank Russell)