Epsilon Fund -
Emerging Bond
Total Return

A low-volatility strategy to invest in emerging market bonds

This is our strategy to generate an absolute return, unrelated to Euro Area bonds, by leveraging carry (return) opportunities on emerging securities and reducing exchange and interest rate risks.

Epsilon Fund - Emerging Bond Total Return mainly invests in short- and medium-term bonds (less than 36 months) with a low interest rate risk, issued by governments and companies of Emerging Countries. Over time, this sector recorded a track record combined with moderate volatility. According to this strategy, we will tactically invest in currencies, spread duration and local currency bonds with the aim of finding interesting opportunities in the markets and, simultaneously, offer drawdown protection.

Strategic Investment mainly in short/medium-term bonds with a low interest rate risk.
Moderate portfolio volatility and low interest rate risk are ensured by the medium duration of about one year.
Tactical investments in exchange rates, interest rates and other credit instruments with maturity dates beyond 36 months.


A short-term strategy unrelated to the fixed income instruments of the Euro Area
The track record of the last few years shows that the Epsilon Fund - Emerging Bond Total Return strategy is not related to the broader universe of emerging markets. This defensive approach allows the fund to obtain positive returns or minimize losses even when the market performance is negative.

Past performance does not ensure future performance. Performance is calculated after deducting current expenses and the related commissions, and excluding subscription and reimbursement fees. The fund does not distribute dividends, as the return from investment is reinvested. The calculation of returns does not take into account applicable taxes for average professional customers in their Country of residence. The exchange rate risk may result in a value reduction. The sector is not an index-linked Undertaking for Collective Investment in Transferable Securities (UCITS), which means it will not replicate and passively follow the performance of a benchmark through synthetic or physical replication. Source: internal data processing, data at 30 Sept. 2021.

An investment team that combines different skillsets

Our team includes portfolio managers specializing in various types of issuers and financial instruments (money markets, governments, and spread products). Our goal is to generate returns by monitoring risks for the part concerning securities with an exposure to certain reference markets and/or asset classes.

Strategy to contain the volatility of emerging bonds

The investment process of the fund is based on two performance drivers with the objective to contain the volatility of emerging bonds. The core component invests in short-term bonds with currency generally hedged in euro, while the tactical component may grasp opportunities on currencies, spread duration, and local currency debt.

Sustainable approach

The management team builds the strategy using ESG criteria to exclude securities of issuers or sectors with a low ESG profile or involved in the production of controversial weapons. The fund is qualified under Article 8 of Regulation (EU) 2019/2088.

SRI Exclusion
Exclusion of issuers operating in sectors that are considered non-socially responsible.
ESG Exclusion
Exclusion of critical issuers, i.e., with a lower ESG sustainability rating, for which an escalation process may be implemented.
Integration of ESG factors
Integration of ESG factors with the goal of building a portfolio with a higher ESG score than that of the benchmark and compliant with good governance practices.

This marketing communication is exclusively intended for professional investors as defined in the European Directive on markets in financial instruments (MiFID) in the countries where the Sub-Fund(s) is/are registered/authorised for distribution. This marketing communication is not intended for retail investors as per MiFID and is not intended for US Person. Before taking any investment decision, you must read the Prospectus, the Key Investor Information Document (the “KIID”), as well as the Management Regulations and the last available annual or semi-annual financial report. These documents are available in English (and the KIIDs in an official language of your country of residence) and may be obtained at any time, free of charge on the Management Company’s website www.eurizoncapital.com. To find out whether the Sub-Fund is registered/authorised in your country, please refer to the www.eurizoncapital.com. This document relates to Eurizon Fund (The “Fund”), a Luxembourg UCITS in accordance with Directive 2009/65/CE and pursuant to the Part I of the Law of 17 December 2010 (the “Law of 2010”) on undertaking for collective investment and “Fonds Commun de Placement” (FCP). This document is issued by Eurizon Capital S.A. organized as a public limited company in accordance with the Law of 1915, registered in the Luxembourg Trade and Companies Register under number B.28536 at 28, boulevard Kockelscheuer, L-1821 Luxembourg and authorised as management company of the Fund under the Luxembourg Law of 17 December 2010 on undertaking for collective investment The content of this document, including any opinions, does not constitute any legal, tax or investment advice. Past performance does not predict future returns. There is no guarantee that the positive forecasts mentioned in this document will be reached in the future. Please liaise with your tax and financial advisor to find out whether a product is suitable to your personal situation and understand the related risks and tax impacts. The tax treatment depends on the individual circumstances of each client and may be subject to change in the future. Should the Sub-Fund be registered/authorised in your country, the entity in charge of processing subscription, repurchase and redemption orders and other payments to unit-holders relating to the units of the UCITS (“Order & Paying facilities”), as well the entity in charge of handling information and Fund documents (“Information facilities”). Switzerland: When the Sub-Fund is not registered with the Swiss Financial Market Supervisory Authority (FINMA), this marketing communication is exclusively intended for Swiss Professional investors/Institutional investors as per Article 4(3) and 4(4) of Federal Act on Financial Services (FinSA).When the Sub-Fund is registered with the Swiss Financial Market Supervisory Authority (FINMA), this marketing communication is intended for Swiss Retail investors as per Article 4(2) of the Federal Act on Financial Services (FinSA) or for Swiss Professional investors/Institutional investors as per Article 4(3) and 4(4) of FinSA. Swiss Fund documents available at the Swiss representative agent: 62, rue du Rhône, 1204 Geneva, Switzerland.

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