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Parvest Enhanced Cash reaches 2 billion in assets

BNP Paribas Asset Management
 

Assets invested in Parvest Enhanced Cash 6 Months have reached EUR 2 billion1 thanks to the fund’s ability to meet clients’ needs for attractive returns in uncertain markets and the convincing performance by its management team.            

This presents a new milestone for the fund which offers investors an appealing enhanced cash strategy. It has been actively marketed for only two years now after starting off with an initial amount of assets under management (AUM) of around EUR 200 million.2

We believe this enhanced cash strategy perfectly tackles the challenge faced by many investors to earn an adequate return in a persistently low-yield environment. In such a context, holders of cash are increasingly switching to enhanced cash products as they seek to avoid paying deposit costs (‘a negative interest rate’) of -0.40%.3

Key points of Parvest Enhanced Cash 6 Months:

1/ A convincing track record and consistent performance (full-year return in 2016: +0.70% against an EONIA return of -0.32%)4

2/ Aiming to deliver a positive performance over any rolling investment period longer than six months, while ensuring capital preservation and stability

3/ Transparent and reasonable fee schedule which takes into account the low interest-rate environment. For the benefit of clients, overall fees were cut several times in 2016

5/ A flexible approach with duration ranging from -1 to +2; it is currently at 1 year; duration can go negative to protect performance should a policy interest-rate rise be anticipated5

6/ Flexible approach using a wide range of euro-denominated fixed-income and money market instruments

  • 1. As as 18 January 2017; source: BNP Paribas Investment Partners
  • 2. Inception: October 2007
  • 3. Deposit facility rate which the ECB charges counterparties making overnight deposits; it acts a floor for the overnight market interest rate; source: www.ecb.europe.eu
  • 4. Past performance is no guarantee of future results. EONIA: Euro OverNight Index Average interest rate.
  • 5. For every percentage point that interest rates move up or down, a bond can be expected to move in the opposite direction by a percentage equal to its duration in years. So if rates go up by one percentage point, a bond with a duration of five years would be expected to lose 5% of its value. The longer the duration, the more sensitive the bond is to interest-rate fluctuations. A fund manager can engineer a negative duration by selling short fixed-income instruments or selling futures. Source: BNP Paribas Investment Partners.

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