NN First Class Return Fund - Passief

Transcription

1 NN First Class Return Fund - Passief All Fund in Scope data as of end December 017 The NN First Class Selective Passive Fund gained 3.1% in the fourth quarter of 017 Continued strong economic growth, strong quarter for equities Rising oil prices, strong quarter for commodities Performance The NN First Class Selective Passive Fund increased by 3.1% during the fourth quarter, mostly from the equity investments. Global growth has been accelerating for more than a year now, following nearly two years of steadily declining momentum with Emerging markets also clearly participating in the global synchronised recovery. In this environment of strong growth and corporate earnings, equities posted a positive performance. The MSCI World (Net, in Euro) was up by 3.9%. The contribution from equities (approx. 63% of the weight) to the total return of the fund was positive (+.79%). All equity strategies contributed positively. Corporate investment grade (IG) bonds and Global High Yield posted a positive absolute return this quarter. Spreads tightened significantly as macro data and statements by politicians and policy makers spurred hopes for stronger growth on the back of US tax reforms and a continuation of loose monetary policy, in the absence of concerns on inflation. Emerging Market bonds advanced although the local bond investments in Euro declined due to a depreciating USD. All in all the spread investments had a marginal negative contribution of -1 bps. Oil prices rose over 15% (Brent) leading to commodities posting strong returns, also helped again by the outperformance of the commodity fund. Commodities had a positive contribution of 0.6%. Investments in Global Real estate posted positive results despite a negative relative performance, leading to a 0.07% contribution to the total return. The hedge fund replication strategy contributed positively, adding 0.11% to the total return. Statistics ISIN code NL Inception date februari 016 Ongoing charges 0.4% Outlook Global growth momentum is expected to continue. Inflation will remain a key variable going forward. As long as inflation does not accelerate markedly but drifts up gradually towards the target, it is hard to see the Fed deviating from its gradual rate rise game plan. Overall, we have a constructive view on equity markets. Equities could once again be the best-performing asset class in 018. This is primarily linked to the vibrant macroeconomic environment, which is characterized by robust growth across regions and sectors and supported by consumers, corporates and governments. Next to inflation (expectations), things to monitor are Central Bank s policy as well as geo-political risks. Asset Class allocation Equities, 6% Real Estate, 8% Bonds, 18% Alternatives, 13% Cash, 0%

2 Fund description NN First Class Selective Passive Return Fund is a mixed fund that offers a carefully selected and diversified investment. The fund invests in multiple asset classes including equities, fixed income and alternative investments. The fund mainly invests in NN IP mutual funds and not by NN IP managed funds, including index funds and ETFs. The fund uses a risk return assumption model to periodically determine the allocation to the asset classes. The fund strives to achieve a diversified portfolio that provides an attractive return per unit of risk. Performance (%) (Net) 3 Months YTD 1 year NN FC Selective Passive Return Fund Equities 3 Months (%) Weight (%) Blackrock ISF-World index-euria BlackRock Emerging Markets Index Sub-Fun ishares Core MSCI World ETF Vanguard Global Stock Index Fund Institu Bonds* 3 Months (%) Weight (%) NN Euro Credit Fund NN (L) Global High Yield NN (L) Emerging Markets Debt HC (euro) NN (L) Emerging Markets Debt LB Real Estate* 3 Months (%) Weight (%) NN (L) Global Real Estate * Based on the gross performance of the funds (non-weighted), all figures are at end December 017. Commodities* 3 Months (%) Weight (%) NN (L) Commodity Enhanced Hedge Funds* 3 Months (%) Weight (%) NN (L) Alternative Beta Disclaimer This communication is intended for MiFID professional investors only. This communication has been prepared solely for the purpose of information and does not constitute an offer, in particular a prospectus or any invitation to treat, buy or sell any security or to participate in any trading strategy or the provision of investment services. While particular attention has been paid to the contents of this communication, no guarantee, warranty or representation, express or implied, is given to the accuracy, correctness or completeness thereof. Any information given in this communication may be subject to change or update without notice. Neither NN Investment Partners B.V., NN Investment Partners Holdings N.V. nor any other company or unit belonging to the NN Group, nor any of its directors or employees can be held directly or indirectly liable or responsible with respect to this communication. Use of the information contained in this communication is at your own risk. This communication and information contained herein must not be copied, reproduced, distributed or passed to any person other than the recipient without NN Investment Partners B.V. s prior written consent. In relation all the funds mentioned in this document, a Key Investor Information Document (KIID) has been published containing all necessary information about the product, the costs and the risks involved. The prospectus and the Key Investor Information Document (KIID) (if applicable) and other legally required documents relating to the fund are available on Investment sustains risk. Please note that the value of any investment may rise or fall and that past performance is not indicative of future results and should in no event be deemed as such. This communication is not directed at and must not be acted upon by US Persons as defined in Rule 90 of Regulation S of the United States Securities Act of 1933, and is not intended and may not be used to solicit sales of investments or subscription of securities in countries where this is prohibited by the relevant authorities or legislation. Any claims arising out of or in connection with the terms and conditions of this disclaimer are governed by Dutch law.

3 NN Liability Matching Fund - M Fund in scope All data as of end December 017 German bond yields declined somewhat due to dovish tone of ECB in the last quarter of 017 Expectation of ongoing economic strength to result is somewhat higher inflation expectations, pushing up government bond yields 5-year EUR swap rates up 7 bps over the quarter Negative return of 0.1% reflection of increase in short term rates; duration 4.7 years Performance Bond yields as a whole did not move significantly in the fourth quarter, with the exception of the US -year yield, which increased quite substantially as a result of rising Fed interest rate expectations. US Treasury yields rose somewhat, on the back of strong economic data and the progress made on US tax reforms. The German Bund yield declined somewhat, despite ongoing macroeconomic strength in the euro region. The main reason for the lower Bund yield was the dovish tone of the ECB. The gap between the US and German 10-year yields widened. Over the quarter 5-year EUR swap rate increased from 0.5% to 0.3%. At the end of the quarter, the AUM of the fund amounted to 645 mln. Outlook Global growth momentum should continue well into next year, with risks tilted to the upside in developed economies, where a positive feedback loop has been established between income and spending and is supported by easy financial conditions. There is also a distinct risk of inflation expectations slipping below the target, especially in Europe but possibly in the US. For government bond markets, we expect the ongoing economic strength to result in somewhat higher inflation expectations, pushing up government bond yields. Fading support from monetary policy should also contribute to moderate upward pressure on yields, as the Fed continues to hike rates and gradually increase the reduction of its balance sheet, while the ECB tapers its bond purchases. We expect the rise in bond yields to be gradual though. ISIN code NL Inception date March 014 Ongoing charges 0.5% 3 Months Year to date 1 year 3 year (ann) NN Liability Matching Fund M - N Treasuries 1.0 Swaps -0.4 Cash 88.4 Duration contribution (year) Treasuries 0.47 Swaps 4.1 Totaal

4 Fund description The NN Liability Matching Funds combine a matching portfolio tailored to individual pension goals with the practical advantages of a fund solution. By using three funds we are able to keep costs limited while maintaining high matching standards almost similar to a fully tailored institutional solution. We manage three Liability Matching Funds with different interest rate sensitivity (duration) profiles. The three funds primarily invest in Euro government bonds with a AAA rating (at purchase) and a maturity at issue of 1-3 years*. Within each of the three funds we raise the duration by interest rate swaps and bond futures. NN Liability Matching Fund (M) aims for a duration of around 4 years and LMF (L) and LMF (XL) of around 0 and 40 years respectively. The three funds are passively managed. The duration profiles of funds are constructed in such a way that when optimally combined they can closely match client specific duration profiles based on typical cashflow schemes. * When a bond rating is downgraded or the maturity drops below 1 year we do not need to sell. Duration allocation 3 Duration swy sw5y sw7y sw10y sw0y sw30y sw40y sw50y Maturity Disclaimer This communication is intended for MiFID professional investors only. This communication has been prepared solely for the purpose of information and does not constitute an offer, in particular a prospectus or any invitation to treat, buy or sell any security or to participate in any trading strategy or the provision of investment services. While particular attention has been paid to the contents of this communication, no guarantee, warranty or representation, express or implied, is given to the accuracy, correctness or completeness thereof. Any information given in this communication may be subject to change or update without notice. Neither NN Investment Partners B.V., NN Investment Partners Holdings N.V. nor any other company or unit belonging to the NN Group, nor any of its directors or employees can be held directly or indirectly liable or responsible with respect to this communication. Use of the information contained in this communication is at your own risk. This communication and information contained herein must not be copied, reproduced, distributed or passed to any person other than the recipient without NN Investment Partners B.V. s prior written consent. In relation all the funds mentioned in this document, a Key Investor Information Document (KIID) has been published containing all necessary information about the product, the costs and the risks involved. The prospectus and the Key Investor Information Document (KIID) (if applicable) and other legally required documents relating to the fund are available on Investment sustains risk. Please note that the value of any investment may rise or fall and that past performance is not indicative of future results and should in no event be deemed as such. This communication is not directed at and must not be acted upon by US Persons as defined in Rule 90 of Regulation S of the United States Securities Act of 1933, and is not intended and may not be used to solicit sales of investments or subscription of securities in countries where this is prohibited by the relevant authorities or legislation. Any claims arising out of or in connection with the terms and conditions of this disclaimer are governed by Dutch law.

5 NN Liability Matching Fund - L Fund in scope All data as of end December 017 German bond yields declined somewhat due to dovish tone of ECB in the last quarter of 017 Expectation of ongoing economic strength to result is somewhat higher inflation expectations, pushing up government bond yields 0-year EUR swap rate down 8 bps over the quarter Positive return of.3% reflection of decrease in rates; duration 1.7 years Performance Bond yields as a whole did not move significantly in the fourth quarter, with the exception of the US -year yield, which increased quite substantially as a result of rising Fed interest rate expectations. US Treasury yields rose somewhat, on the back of strong economic data and the progress made on US tax reforms. The German Bund yield declined somewhat, despite ongoing macroeconomic strength in the euro region. The main reason for the lower Bund yield was the dovish tone of the ECB. The gap between the US and German 10-year yields widened. Over the quarter the 0-year EUR swap rate decreased from 1.50% to 1.4%. At the end of the quarter, the AUM of the fund amounted to 1,136 mln. Outlook Global growth momentum should continue well into next year, with risks tilted to the upside in developed economies, where a positive feedback loop has been established between income and spending and is supported by easy financial conditions. There is also a distinct risk of inflation expectations slipping below the target, especially in Europe but possibly in the US. For government bond markets, we expect the ongoing economic strength to result in somewhat higher inflation expectations, pushing up government bond yields. Fading support from monetary policy should also contribute to moderate upward pressure on yields, as the Fed continues to hike rates and gradually increase the reduction of its balance sheet, while the ECB tapers its bond purchases. We expect the rise in bond yields to be gradual though. ISIN code NL Inception date March 014 Ongoing charges 0.5% 3 Months Year to date 1 year 3 year (ann) NN Liability Matching Fund L - N Treasuries 7.4 Swaps -.5 Cash 75. Duration contribution (year) Treasuries Swaps 1.9 Total

6 Fund description The NN Liability Matching Funds combine a matching portfolio tailored to individual pension goals with the practical advantages of a fund solution. By using three funds we are able to keep costs limited while maintaining high matching standards almost similar to a fully tailored institutional solution. We manage three Liability Matching Funds with different interest rate sensitivity (duration) profiles. The three funds primarily invest in Euro government bonds with a AAA rating (at purchase) and a maturity at issue of 1-3 years*. Within each of the three funds we raise the duration by interest rate swaps and bond futures. NN Liability Matching Fund (M) aims for a duration of around 4 years and LMF (L) and LMF (XL) of around 0 and 40 years respectively. The three funds are passively managed. The duration profiles of funds are constructed in such a way that when optimally combined they can closely match client specific duration profiles based on typical cashflow schemes. * When a bond rating is downgraded or the maturity drops below 1 year we do not need to sell. Duration allocation Duration swy sw5y sw7y sw10y sw0y sw30y sw40y sw50y Maturity Disclaimer This communication is intended for MiFID professional investors only. This communication has been prepared solely for the purpose of information and does not constitute an offer, in particular a prospectus or any invitation to treat, buy or sell any security or to participate in any trading strategy or the provision of investment services. While particular attention has been paid to the contents of this communication, no guarantee, warranty or representation, express or implied, is given to the accuracy, correctness or completeness thereof. Any information given in this communication may be subject to change or update without notice. Neither NN Investment Partners B.V., NN Investment Partners Holdings N.V. nor any other company or unit belonging to the NN Group, nor any of its directors or employees can be held directly or indirectly liable or responsible with respect to this communication. Use of the information contained in this communication is at your own risk. This communication and information contained herein must not be copied, reproduced, distributed or passed to any person other than the recipient without NN Investment Partners B.V. s prior written consent. In relation all the funds mentioned in this document, a Key Investor Information Document (KIID) has been published containing all necessary information about the product, the costs and the risks involved. The prospectus and the Key Investor Information Document (KIID) (if applicable) and other legally required documents relating to the fund are available on Investment sustains risk. Please note that the value of any investment may rise or fall and that past performance is not indicative of future results and should in no event be deemed as such. This communication is not directed at and must not be acted upon by US Persons as defined in Rule 90 of Regulation S of the United States Securities Act of 1933, and is not intended and may not be used to solicit sales of investments or subscription of securities in countries where this is prohibited by the relevant authorities or legislation. Any claims arising out of or in connection with the terms and conditions of this disclaimer are governed by Dutch law.

7 NN Liability Matching Fund - XL Fund in scope All data as of end December 017 German bond yields declined somewhat due to dovish tone of ECB in the last quarter of 017 Expectation of ongoing economic strength to result is somewhat higher inflation expectations, pushing up government bond yields 40-year EUR swap rates down 10 bps over the quarter Positive return of 4.7% reflection of decrease in rates; duration 40.4 years Performance Bond yields as a whole did not move significantly in the fourth quarter, with the exception of the US -year yield, which increased quite substantially as a result of rising Fed interest rate expectations. US Treasury yields rose somewhat, on the back of strong economic data and the progress made on US tax reforms. The German Bund yield declined somewhat, despite ongoing macroeconomic strength in the euro region. The main reason for the lower Bund yield was the dovish tone of the ECB. The gap between the US and German 10-year yields widened. Over the quarter the 40-year EUR swap rate decreased by 10 basis points to 1.51%. At the end of the quarter, the AUM of the fund amounted to 975 mln. Outlook Global growth momentum should continue well into next year, with risks tilted to the upside in developed economies, where a positive feedback loop has been established between income and spending and is supported by easy financial conditions. There is also a distinct risk of inflation expectations slipping below the target, especially in Europe but possibly in the US. For government bond markets, we expect the ongoing economic strength to result in somewhat higher inflation expectations, pushing up government bond yields. Fading support from monetary policy should also contribute to moderate upward pressure on yields, as the Fed continues to hike rates and gradually increase the reduction of its balance sheet, while the ECB tapers its bond purchases. We expect the rise in bond yields to be gradual though. ISIN code NL Inception date March 014 Ongoing charges 0.5% 3 Months Year to date 1 year 3 year (ann) NN Liability Matching Fund XL - N Treasuries 45. Swaps -0.4 Cash 55. Duration contribution (year) Treasuries 0.04 Swaps Total

8 Fund description The NN Liability Matching Funds combine a matching portfolio tailored to individual pension goals with the practical advantages of a fund solution. By using three funds we are able to keep costs limited while maintaining high matching standards almost similar to a fully tailored institutional solution. We manage three Liability Matching Funds with different interest rate sensitivity (duration) profiles. The three funds primarily invest in Euro government bonds with a AAA rating (at purchase) and a maturity at issue of 1-3 years*. Within each of the three funds we raise the duration by interest rate swaps and bond futures. NN Liability Matching Fund (M) aims for a duration of around 4 years and LMF (L) and LMF (XL) of around 0 and 40 years respectively. The three funds are passively managed. The duration profiles of funds are constructed in such a way that when optimally combined they can closely match client specific duration profiles based on typical cashflow schemes. * When a bond rating is downgraded or the maturity drops below 1 year we do not need to sell. Duration allocation 0,0 15,0 Duration 10,0 5,0 0,0-5,0 swy sw5y sw7y sw10y sw0y sw30y sw40y sw50y Maturity Disclaimer This communication is intended for MiFID professional investors only. This communication has been prepared solely for the purpose of information and does not constitute an offer, in particular a prospectus or any invitation to treat, buy or sell any security or to participate in any trading strategy or the provision of investment services. While particular attention has been paid to the contents of this communication, no guarantee, warranty or representation, express or implied, is given to the accuracy, correctness or completeness thereof. Any information given in this communication may be subject to change or update without notice. Neither NN Investment Partners B.V., NN Investment Partners Holdings N.V. nor any other company or unit belonging to the NN Group, nor any of its directors or employees can be held directly or indirectly liable or responsible with respect to this communication. Use of the information contained in this communication is at your own risk. This communication and information contained herein must not be copied, reproduced, distributed or passed to any person other than the recipient without NN Investment Partners B.V. s prior written consent. In relation all the funds mentioned in this document, a Key Investor Information Document (KIID) has been published containing all necessary information about the product, the costs and the risks involved. The prospectus and the Key Investor Information Document (KIID) (if applicable) and other legally required documents relating to the fund are available on Investment sustains risk. Please note that the value of any investment may rise or fall and that past performance is not indicative of future results and should in no event be deemed as such. This communication is not directed at and must not be acted upon by US Persons as defined in Rule 90 of Regulation S of the United States Securities Act of 1933, and is not intended and may not be used to solicit sales of investments or subscription of securities in countries where this is prohibited by the relevant authorities or legislation. Any claims arising out of or in connection with the terms and conditions of this disclaimer are governed by Dutch law.