http://ipaper.ipapercms.dk/Unit/jyskeinvest/jyskeinvestdk/JyskeInvestnyhedsbrevjuni2012UK/RSS.ashxiPaper PagesThu, 05 Jul 2012 14:09:49 +0200http://ipaper.ipapercms.dk/Unit/jyskeinvest/jyskeinvestdk/JyskeInvestnyhedsbrevjuni2012UK/http://ipaper.ipapercms.dk/Unit/jyskeinvest/jyskeinvestdk/JyskeInvestnyhedsbrevjuni2012UK/?Page=1http://ipaper.ipapercms.dk/Unit/jyskeinvest/jyskeinvestdk/JyskeInvestnyhedsbrevjuni2012UK/?Page=1Jyske Invest ExPECT THE DIFFERENCE June 2012 Content Interest rates are tough on bond investors While home owners are cheering the low interest rate, many bond investors are getting concerned. They wonder how to get a decent return when interest rates are at a historical low and they have no strong urge to invest in equities. In this situation, high-yielding bonds may be an obvious opportunity. Due to the very relaxed monetary policy and the prospects of continuing low growth, the yields on traditional Danish government and mortgage bonds have fallen drastically. This situation is seen in most Western countries. Investors in developed-market bonds have seen good returns in recent years due to falling yields that have boosted the price of the bonds. But now the return potential are about to be exhausted unless yields fall even further. Therefore, bond investors must also in future have to go without high returns. Inflation is higher than returns Right now the yield on US 10-year government bonds is about 1.6% while inflation is about 2.3%. This means that prices are rising by more than the annual interest yield on bonds. The days are over when you could invest in government bonds, sit back and just wait for your return. >> Interest rates are tough on bond investors >> We adjust our product range >> Russia - another BRIC in the fund >> Emerging markets still the best >> Top award in Europe >>2012-07-05T14:09:49+02:00http://ipaper.ipapercms.dk/Unit/jyskeinvest/jyskeinvestdk/JyskeInvestnyhedsbrevjuni2012UK/?Page=2http://ipaper.ipapercms.dk/Unit/jyskeinvest/jyskeinvestdk/JyskeInvestnyhedsbrevjuni2012UK/?Page=2Jyske Invest What can you do? This is a difficult situation for bond investors because right now they will have to invest in securities involving a higher risk to obtain a decent return – and that is typically what they opted not to do. Instead it may be worthwhile to consider investing in high-yielding bonds, which rank just above developed-market bonds on the risk meter, yet somewhat below equities. This could, for instance, be corporate bonds or emerging-market government bonds, which currently offer yields of 5-6%. ExPECT THE DIFFERENCE >> Interest rates are tough on bond investors Over the past ten years, the annual return on Jyske Invest Emerging Market Bonds has averaged 9.6%, while that on Jyske Invest Dollar Bonds averaged 4.1% (based on Jyske Invest’s own calculations). Even though, over the next ten years, the returns will most likely be lower, we expect to see the same trend – namely that high-yielding bonds will yield a higher return than developed-market bonds. Our calculations also show that it is possible to compose a bond portfolio so it consists of 80% developed-market bonds and 20% high-yielding bonds without increasing the overall risk. Before making any investment choices, we encourage you to contact your adviser. Visit jyskeinvest.com to see our bond funds (under ’Funds and Prices’) and read the Key Investor Information about the risk associated with the individual funds. You find the Prospect under ‘Downloads’. We adjust our product range Like most other mutual funds, Jyske Invest International has for many years established new funds with very different investment themes. But lately we have begun closing funds. Why is that? It is our vision to be innovative and offer a broad range of investment opportunities to our investors. But like any other business, we have to keep up with the times and our investors’ demands. Consequently, we may have to change our product range if, for instance, demand becomes too low. Expenses are too high When we decide to merge or close funds, it is often because the number of investors and the assets under management in the fund have fallen to such an extent that the fund’s administrative expenses have become too high for the remaining investors. New funds will still be established When demands disappear, new arise. And when we close and merge funds, we have more resources to establish new interesting funds which our investors demand. This is in line with our vision to be innovative and offer our clients new interesting investment opportunities. We would like to offer broad - as well as narrow - funds Our objective at Jyske Invest is to be professional and active asset managers. We do not only offer the broad and very popular products, for instance Favourite Bonds, Emerging Market Bonds, Corporate Bonds, Global Equities and Favourite Equities, we also want to offer narrow, country-specific emerging market funds, for instance with Chinese, Indian and Turkish equities. And now we can also offer Russian equities in Jyske Invest Russian Equities. Changes in 2012 • In August we close the funds Jyske Invest Swedish Equities and Jyske Invest Global Real Estate Equities. • In June we converted Jyske Invest Eastern European Equities into Jyske Invest Russian Equities. Read more at jyskeinvest.com/ closuresandconversions2012-07-05T14:09:49+02:00http://ipaper.ipapercms.dk/Unit/jyskeinvest/jyskeinvestdk/JyskeInvestnyhedsbrevjuni2012UK/?Page=3http://ipaper.ipapercms.dk/Unit/jyskeinvest/jyskeinvestdk/JyskeInvestnyhedsbrevjuni2012UK/?Page=3Russia - another BRIC in the fund For quite some time, Jyske Invest International has offered an equity fund including two of the so-called BRIC countries. Now we launch Jyske Invest Russian Equities – and hence we offer another BRIC country to our investors. The so-called BRIC countries have for quite some time attracted investor attention. In recent years, the BRIC countries – short for Brazil, Russia, India and China – have reported drastic economic growth. The growth has in particular been driven by the production of commodities, cheap production facilities and a steadily growing middle class, which increases domestic consumption markedly. Our country-specific funds covering the emerging equity markets offers investors exciting opportunities. Through Jyske Invest, you now have the opportunity to invest in Indian, Chinese as well as Russian equities. If you wish to invest in the economic growth in Brazil, you have the opportunity to do so through Jyske Invest Latin American Equities. Moreover, to spice things up, we offer a fund with Turkish equities. Not that heavy a debt burden The BRIC countries have so far weathered the global crisis well. This is among other things due to a growing domestic market. Together the four countries represent 40% of the world’s population, and the growing purchasing power of the population offers great growth potential. Also, the countries are not burdened that much by debts as is the case in the Western world after the financial crisis. Russia – and interesting player Even though Russia is facing major challenges in the form of corruption and an immediate need of reforms, the country is an interesting player. Thanks to its 140 million citizens and ample resources of oil, gas, iron ore, coal, gold, silver and nickel, Russia holds out the potential of becoming an interesting economy. In recent years, the Russian economy has grown by about 4% annually. The country reports historically low inflation and unemployment rates, and average wages have doubled since 2003. In June 2012, we transformed Jyske Invest Eastern European Equities into Jyske Invest Russian Equities, which offers investors the opportunity of investing in a fund consisting solely of Russian equities. Previously two thirds of the fund consisted of Russian equities, but now it invests solely in Russian equities. Risk and return go hand in hand In recent years, the emerging markets, including the BRIC countries, have offered the highest returns. However, investment in these countries also involve a higher risk. Investors should be aware that investments in emerging markets involve particular risks that do not exist in the developed markets. We encourage you to contact your adviser and to read more about risk, among other things, in the Prospect (on jyskeinvest.com under ‘Downloads’) and the funds’ Key Investor Information (on jyskeinvest.com under ‘Funds and Prices’) before you make any investment choices.2012-07-05T14:09:49+02:00http://ipaper.ipapercms.dk/Unit/jyskeinvest/jyskeinvestdk/JyskeInvestnyhedsbrevjuni2012UK/?Page=4http://ipaper.ipapercms.dk/Unit/jyskeinvest/jyskeinvestdk/JyskeInvestnyhedsbrevjuni2012UK/?Page=4Jyske Invest ExPECT THE DIFFERENCE Emerging markets still the best Investments in emerging markets have given our members the best returns over the past ten years. Also, European bonds as well as corporate bonds generated positive returns while the developed equity markets in the US and Europe performed less well What has EUR 100 turned into? US equities Japanese equities European bonds Global equities European bonds Corporate bonds Emerging market equities Emerging market bonds over the same period. For instance, an investment of EUR 100 in emerging market bonds in 2001 turned into EUR 252 at the end of 2011. This corresponds to an annual return over the 10-year period of 9.7%. 87 91 102 105 161 202 249 252 Source: MSCIBarra and Jyske Invest. Top award in Europe Lipper, the internationally recognised rating agency, has honoured Jyske Invest International with a Lipper Fund Award as the best mutual fund in Europe in the category ’Best Group Small – Overall (3 years)’. We won the award on the background of our risk-adjusted return over the past three years. See all our awards in 2012 here: jyskeinvest.com/awards The chart shows what an investment of EUR 100 has turned into on selected markets in the period from 2001 to 2011. Please note that past returns and performance are no indicator or guarantee of future returns and performance. The newsletter is part of the marketing of Jyske Invest. Hence, information should not be regarded as investment advice, and investors are advised to contact a personal advisor with respect to investment, tax issues, etc. before buying and selling. Past performance is not a reliable indicator of future performance. Performance and/or price development may be negative. The information is never addressed to persons resident in or considered citizens of countries where such marketing is unlawful. Publisher Jyske Invest Fund Management A/S Vestergade 8-16 8600 Silkeborg Denmark Tel. No. +45 8989 2500 jyskeinvest.com jyskeinvest@jyskeinvest.com Editors Hans Jørgen Larsen, Managing Director (responsible under the Danish Press Act), Mia Katholm Hessellund and Dorte Lenskjold Hjerrild. This issue closed for contributions on 1 June 2012. Layout and text Cox Copenhagen a|s Deregistration If you do not wish to receive the newsletter, please contact Jyske Bank or send an email to jyskeinvest@jyskeinvest.com. Remember to state your name and address. ExPECT THE DIFFERENCE2012-07-05T14:09:49+02:00