NN First Class Return Fund - Passief

Transcription

1 NN First Class Return Fund - Passief All Fund in Scope data as of end September 017 The NN First Class Selective Passive Return Fund gained 1.3% Global equities continued to move upward in the quarter Good quarter for commodities Performance As it was the case in the second quarter, currency movements had an important impact on equity returns. The euro rose further against the US dollar, although less than in the previous 3-month period. After a gain of 6.6% in the second quarter, the euro increased an additional 3.7% in the past quarter versus the US dollar. While global equities rose 5% in US dollar terms, they rose 1.3% in euros (MSCI World TR). Looking at the regions, we see that emerging markets outperformed developed markets for the third quarter in a row. Emerging markets are enjoying healthy capital inflows, thanks to improving economic momentum on the one hand and gradual monetary tightening in developed markets, which is keeping bond yields low and the US dollar relatively weak, on the other hand. In addition, expected earnings growth for 018 is superior to that in developed markets (1% versus 9.5%) and it also comes at a still attractive discount. The contribution from equities to the total return of the fund was positive (+1.1%). Corporate investment grade (IG) bonds posted a positive absolute return in the third quarter of 017, just like the emerging market debt investments and the high yield investments. The fixed income funds therefore all contributed positively (+0.1% in total). Commodities posted strong returns, which led, also helped here by the outperformance of the commodity fund to a positive contribution of 0.16%. Investments in Global Real estate posted also this quarter negative results and relative performance, leading to a -0.17% contribution to the total return. The hedge fund replication strategy contributed positively, adding 0.1% to the total return. Statistics ISIN code NL Inception date February 016 Ongoing charges 0.4% Outlook Our base case is that global growth will not break the ceiling of recent years, but remain close to it at the same time. This stance rests on signs of a slowdown in profit growth which, in turn, is driven by the view that for now the cyclical rebound in productivity growth has mostly run its course while pricing power will not surge ahead. The slowdown in profit growth goes hand in hand with a stabilisation in DM business confidence since the start of the year. This indeed suggests that corporate spending momentum should remain robust but will not accelerate further. For government bond markets, expectations of fiscal stimulus via tax cuts and more infrastructure spending in the US have been deflated a lot as investors expect fiscal plans to get mired and watered down in the political process. We expect that, in the end, still some fiscal stimulus in the US will be implemented which could act as a source of upward surprise. 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 1,1 4,4 NN (L) Global High Yield 1,7 4,4 NN (L) Emerging Markets Debt HC (euro) 3,0,1 NN (L) Emerging Markets Debt LB 0,3 6,6 Real Estate 3 Months (%) Weight (%) NN (L) Global Real Estate Based on the gross performance of the funds (non-weighted) Commodities 3 Months (%) Weight (%) NN (L) Commodity Enhanced,5 6,3 Hedge Funds 3 Months (%) Weight (%) NN (L) Alternative Beta 1,6 6,3 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 September 017 Government bond yields moved mostly sideways 5-year EUR swap rates down 3 bps over the quarter Positive return of 0.3% reflection of decrease in rates; duration 4.8 years Performance Government bond yields moved mostly sideways in the third quarter. Performance was mixed in July, with US 10y yields ending the month almost flat and German 10y yields higher, while periphery spreads in Europe tightened. Yields receded for the rest of the month and through August as North Korea s missile tests led to geopolitical tensions and increased market risk aversion. Over the quarter the fund realized a net return of +0.3%. This increase reflects the decrease in Euro swap rates. Over the quarter 5-year EUR swap rate decreased from 0.8% to 0.5%. The overall duration of the fund was 4.8 years per end of September. At the end of the quarter, the AUM of the fund amounted to 56 mln. Outlook Our base case is that global growth will not break the ceiling of recent years, but remain close to it at the same time. This stance rests on signs of a slowdown in profit growth which, in turn, is driven by the view that for now the cyclical rebound in productivity growth has mostly run its course while pricing power will not surge ahead. Going forward, the path of monetary policy normalization and market expectations hereof will remain a key factor for government bond markets. The ECB s governing council has dropped its previous guidance that rates might drop further, while reiterating its readiness to increase the amount or duration of its bond purchase should the economy worsen. On the Eurozone inflation front, the latest data do not indicate a likely swift reversal in the current gradual nature of this monetary policy normalization process. The ECB has for some time now emphasized its dissatisfaction with the pace of underlying inflation. 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 13.8 Swaps -0.3 Cash 86.6 Duration contribution (year) Treasuries 0.46 Swaps 4.3 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 September 017 Government bond yields moved mostly sideways 0-year EUR swap rate up 5 bps over the quarter Negative return of 0.5% reflection of increase in rates; duration 1.9 years Performance Government bond yields moved mostly sideways in the third quarter. Performance was mixed in July, with US 10y yields ending the month almost flat and German 10y yields higher, while periphery spreads in Europe tightened. Yields receded for the rest of the month and through August as North Korea s missile tests led to geopolitical tensions and increased market risk aversion. Over the quarter the fund realized a net return of -0.5%. This decrease reflects the increase in Euro swap rates. Over the quarter the 0-year EUR swap rate increased from 1.45% to 1.50%. During the quarter the overall duration of the fund was mainly unchanged at 1.9 years per end of September. At the end of the quarter, the AUM of the fund amounted to 876 mln. Outlook Our base case is that global growth will not break the ceiling of recent years, but remain close to it at the same time. This stance rests on signs of a slowdown in profit growth which, in turn, is driven by the view that for now the cyclical rebound in productivity growth has mostly run its course while pricing power will not surge ahead. Going forward, the path of monetary policy normalization and market expectations hereof will remain a key factor for government bond markets. The ECB s governing council has dropped its previous guidance that rates might drop further, while reiterating its readiness to increase the amount or duration of its bond purchase should the economy worsen. On the Eurozone inflation front, the latest data do not indicate a likely swift reversal in the current gradual nature of this monetary policy normalization process. The ECB has for some time now emphasized its dissatisfaction with the pace of underlying inflation. 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.00 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 September 017 Government bond yields moved mostly sideways 40-year EUR swap rates up 7 bps over the quarter Negative return of.7% reflection of increase in rates; duration 40.6 years Performance Government bond yields moved mostly sideways in the third quarter. Performance was mixed in July, with US 10y yields ending the month almost flat and German 10y yields higher, while periphery spreads in Europe tightened. Yields receded for the rest of the month and through August as North Korea s missile tests led to geopolitical tensions and increased market risk aversion. Over the quarter the fund realized a net return of-.7%. This decrease reflects the increase in Euro swap rates. Over the quarter the 40-year EUR swap rate increased by 7 basis points to 1.61%. The overall duration of the fund was 40.6 years per end of September. At the end of the quarter, the AUM of the fund amounted to 576 mln. Outlook Our base case is that global growth will not break the ceiling of recent years, but remain close to it at the same time. This stance rests on signs of a slowdown in profit growth which, in turn, is driven by the view that for now the cyclical rebound in productivity growth has mostly run its course while pricing power will not surge ahead. Going forward, the path of monetary policy normalization and market expectations hereof will remain a key factor for government bond markets. The ECB s governing council has dropped its previous guidance that rates might drop further, while reiterating its readiness to increase the amount or duration of its bond purchase should the economy worsen. On the Eurozone inflation front, the latest data do not indicate a likely swift reversal in the current gradual nature of this monetary policy normalization process. The ECB has for some time now emphasized its dissatisfaction with the pace of underlying inflation. 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 50.9 Swaps -4.8 Cash 53.8 Duration contribution (year) Treasuries -0.0 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.