Fund Overview

Investment Objective

The Fund’s investment objective is to generate both income and long term capital growth by investing in a diversified portfolio of securities, primarily in the global convertible market.

Investment Philosophy

Target asymmetric, risk-adjusted returns
Invest globally, geography and benchmark agnostic
Clear focus on limiting drawdowns and identifying re-rating catalysts
Maintain portfolio liquidity

The Fund Manager targets superior risk-adjusted returns based on extensive fundamental research and convertible bond analysis. The Fund has a focus on downside protection, income generation, and balanced upside equity participation.

Investment decisions rely heavily upon fundamental credit and equity research, using both quantitative analysis (Convertible bond modelling, company balance sheet & income statement analysis and peer group analysis) and qualitative analysis (Third party research, management meetings and review of economic fundamentals and sector trends).

Key Facts

Team of four sector specialists based in London and Connecticut
The team has 85+ years of combined industry experience
Typically 60‑100 positions with geographic and sector diversification
Fundamentally-driven convertible analysis. No benchmark constraints
Ability to hedge interest rates

Key Fund Literature

Morningstar Managed Investment Report

31 Aug 2024

Where do we go from here?

20 Nov 2024

Fund Managers & Analysts

David Keetley

Fund Manager

Stephen McCormick

Fund Manager

Jake Collins, CFA

Senior Analyst

Michael Provvisionato

Investment Analyst

David Keetley

David joined Polar Capital in October 2010 to establish the global convertibles team and is co-manager of the Global Convertible Fund and the Global Absolute Return Fund.

David is an experienced convertible bond specialist, having spent 36 years in the asset class in both investment banking and investment management. Before joining Polar Capital in October 2010 to establish the Convertible team, he was joint CEO of Vicis Capital (UK) Ltd which he joined in 2006 to set up and manage the international convertible portfolio of the New York-based hedge fund. David started his career at Salomon Brothers International and moved to Baii (a subsidiary of BNP Paribas) in 1987, where he first started managing convertibles. He joined Schroders in 1996 and Citigroup in 2000 following the Citi takeover of Schroder Investment Bank.

Academic qualificationsBSc (Hons) in Civil Engineering, University of Glasgow
Professional qualificationsFellow of the Chartered Institute for Securities and Investment
Industry experience38 years

Source & Copyright: CITYWIRE. David Keetley has been awarded a Plus rating by Citywire for his 3 year risk-adjusted performance for the period 31/10/2021 - 31/10/2024.

Stephen McCormick

Stephen joined Polar Capital in October 2010 and is co-manager of the Global Convertible Fund and the Global Absolute Return Fund.

Prior to moving into convertible trading, Stephen was a research analyst at Tucker Anthony. In 1993 he became a partner in Forum Capital Markets, eventually joining Paine Webber in 1994 where he went on to manage their convertible department until 1998. He was a senior member of the convertible sales team at Morgan Stanley before establishing and managing Valmiki Capital Management in 2005. The following year, he moved to Moore Capital where he, as a member of a three-person team, managed a $1bn global long/short equity portfolio before joining Vicis Capital to manage the US convertible bond portfolio in 2008.

Academic qualificationsBSc in Finance, Providence College, Rhode Island
Industry experience38 years

Source & Copyright: CITYWIRE. Stephen McCormick has been awarded a Plus rating by Citywire for his 3 year risk-adjusted performance for the period 31/10/2021 - 31/10/2024.

Jake Collins, CFA

Jake joined Polar Capital in October 2013 following a summer internship during which he created materials to help in the initial days of marketing the Polar Capital Global Convertible Fund. He joined as an Investment Analyst and was subsequently promoted to Senior Investment Analyst in 2022.

Academic qualificationsBSc (1st Class Hons) in Mathematics, University of DurhamMSc (Merit) in Finance and Investment, University of Durham
Professional qualificationsCFA Charterholder
Industry experience11 years

Michael Provvisionato

Michael joined Polar Capital as an Investment Analyst in the Convertible Bond Team in July 2022. He completed a four-month internship with the team earlier in the year, carrying out ESG and sustainability research as the Funds transitioned to be SFDR Article 8 compliant. He graduated magna cum laude in Finance from Providence College, Rhode Island, in summer 2022.

Academic qualificationsBSc (magna cum laude) in Finance, Providence College, Rhode Island
Industry experience2 years

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Get the latest insights sent straight to your inbox

Countries in which this fund is available

Please click on each country to see share class availability

Risks:

Capital is at risk and there is no guarantee the Fund will achieve its objective. Investors should make sure their attitude towards risk is aligned with the risk profile of the Fund before investing.

Past performance is not a reliable guide to future performance. The value of investments may go down as well as up and you might get back less than you originally invested as there is no guarantee in place.

The value of a fund’s assets may be affected by uncertainties such as international political developments, market sentiment, economic conditions, changes in government policies, restrictions on foreign investment and currency repatriation, currency fluctuations and other developments in the laws and regulations of countries in which investment may be made. Please see the Fund’s Prospectus for details of all risks.
The Fund invests in equities, convertible and fixed income securities and prices can rise or fall due to several factors affecting global stock markets.
The Fund uses derivatives which carry the risk of reduced liquidity, substantial loss, and increased volatility in adverse market conditions, such as failure amongst market participants. The use of derivatives will result in the Fund being leveraged (where market exposure and the potential for loss exceeds the amount the Fund has invested) and in these market conditions the effect of leverage will magnify losses. The Fund makes extensive use of derivatives.
The Fund invests in assets denominated in currencies other than the Fund's base currency. Changes in exchange rates may have a negative impact on the Fund's investments. If the share class currency is different from the currency of the country in which you reside, exchange rate fluctuations may affect your returns when converted into your local currency. Hedged share classes may have associated costs which may impact the performance of your investment.
There may be times where the issuer or guarantor of a fixed income (or convertible) security cannot meet its payment obligations or has their credit rating downgraded, resulting in potential losses for the Fund.
The Fund invests in emerging markets where there is a greater risk of volatility due to political and economic uncertainties, restrictions on foreign investment, currency repatriation and currency fluctuations. Developing markets are typically less liquid which may result in large price movements to the Fund.

Important Information: This is a marketing communication and does not constitute a solicitation or offer to any person to buy or sell any related securities or financial instruments. Any opinions expressed may change. This website does not contain information material to the investment objectives or financial needs of the recipient. This website is not advice on legal, taxation or investment matters. Tax treatment depends on personal circumstances. Investors must rely on their own examination of the fund or seek advice. Investment may be restricted in other countries and as such, any individual who receives this website must make themselves aware of their respective jurisdiction and observe any restrictions.

A decision may be taken at any time to terminate the marketing of the Fund in any EEA Member State in which it is currently marketed. Shareholders in the affected EEA Member State will be given notification of any decision and provided the opportunity to redeem their interests in the Fund, free of any charges or deductions, for at least 30 working days from the date of the notification.

Investment in the Fund is an investment in the shares of the Fund and not in the underlying investments of the Fund. Further information about fund characteristics and any associated risks can be found in the Fund’s Key Investor Document or Key Investor Information Document (“KID” or “KIID”), the Prospectus (and relevant Fund Supplement), the Articles of Association and the Annual and Semi-Annual Reports. Please refer to these documents before making any final investment decisions. These documents are available free of charge at Polar Capital Funds plc, Georges Court, 54-62 Townsend Street, Dublin 2, Ireland, via email by contacting Investor-Relations@polarcapitalfunds.com or at www.polarcapital.co.uk. The KID is available in the languages of all EEA member states in which the Fund is registered for sale; the Prospectus, Annual and Semi-Annual Reports and KIID are available in English.

The Fund promotes, among other characteristics, environmental or social characteristics and is classified as an Article 8 fund under the EU's Sustainable Finance Disclosure Regulation (SFDR). For more information, please see the Prospectus and relevant Fund Supplement.

ESG and sustainability characteristics are further detailed on the investment manager’s website: (https://www.polarcapital.co.uk/ESG-and-Sustainability/Responsible-Investing/).

A summary of investor rights associated with investment in the Fund is available online at the above website, or by contacting the above email address. This document is provided and approved by both Polar Capital LLP and Polar Capital (Europe) SAS.

Polar Capital LLP is authorised and regulated by the Financial Conduct Authority (“FCA”) in the United Kingdom, and the Securities and Exchange Commission (“SEC”) in the United States. Polar Capital LLP’s registered address is 16 Palace Street, London, SW1E 5JD, United Kingdom.

Polar Capital (Europe) SAS is authorised and regulated by the Autorité des marchés financiers (AMF) in France. Polar Capital (Europe) SAS’s registered address is 18 Rue de Londres, Paris 75009, France.

Polar Capital LLP is a registered Investment Advisor with the SEC. Polar Capital LLP is the investment manager and promoter of Polar Capital Funds plc – an open-ended investment company with variable capital and with segregated liability between its sub-funds – incorporated in Ireland, authorised by the Central Bank of Ireland and recognised by the FCA. Bridge Fund Management Limited acts as management company and is regulated by the Central Bank of Ireland. Registered Address: Percy Exchange, 8/34 Percy Place, Dublin 4, Ireland.

Third-party Data: Some information contained herein has been obtained from third party sources and has not been independently verified by Polar Capital. Neither Polar Capital nor any other party involved in or related to compiling, computing or creating the data makes any express or implied warranties or representations with respect to such data (or the results to be obtained by the use thereof), and all such parties hereby expressly disclaim all warranties of originality, accuracy, completeness, merchantability or fitness for a particular purpose with respect to any data contained herein.

Information Subject to Change: The information contained herein is subject to change, without notice, at the discretion of Polar Capital and Polar Capital does not undertake to revise or update this information in any way.

Benchmark: The Fund is actively managed and uses the Refinitiv Global Focus Convertible Bond Index as a performance target and to calculate the performance fee. The benchmark has been chosen as it is generally considered to be representative of the investment universe in which the Fund invests. The performance of the Fund is likely to differ from the performance of the benchmark as the holdings, weightings and asset allocation will be different. Investors should carefully consider these differences when making comparisons. Further information about the benchmark can be found https://www.refinitiv.com/en/financial-data/indices/convertible-indices. The benchmark is provided by an administrator on the European Securities and Markets Authority (ESMA) register of benchmarks which includes details of all authorised, registered, recognised and endorsed EU and third country benchmark administrators together with their national competent authorities.

Country Specific Disclaimers When considering an investment into the Fund, you should make yourself aware of the relevant financial, legal and tax implications. Neither Polar Capital LLP nor Polar Capital Funds plc shall be liable for, and accept no liability for, the use or misuse of this document.

The Fund is registered for sale to all investors in the countries listed above. Investors should make themselves aware of the relevant financial, legal and tax implications if they choose to invest.

Source & Copyright: ©2024 Morningstar, Inc. All Rights Reserved. Rating representative of the I USD Inc Share Class, as at 31/10/2024. The information contained herein: (1) is proprietary to Morningstar; (2) may not be copied or distributed; and (3) is not warranted to be accurate, complete or timely. Neither Morningstar nor its content providers are responsible for any damages or losses arising from any use of this information. Past performance is no guarantee of future results. For more detailed information about the Morningstar rating, including its methodology, please go to: https://shareholders.morningstar.com/investor-relations/governance/Compliance--Disclosure/default.aspx. For disclosure and detailed information about this fund please request the full Morningstar Managed Investment Report from investor-relations@polarcapitalfunds.com.

Consideration of UN SDG 8: Decent Work and Economic Growth

The Polar Capital Global Convertible Bond Fund considers the alignment of its investments with the United Nations Sustainable Development Goal 8 ¹, which promotes sustained, inclusive and sustainable economic growth, full and productive employment for all, efficient use of resources and protection against environmental degradation.

Below please find our ESG Policy Documents followed by a summary of our 3 stage process to promote responsible and sustainable corporate behaviour.

ESG Policy Documents

SFDR Level 2 Website Disclosure

28 Dec 2022

Stage 1 – Exclusions

Applying norms-based and negative screens

The Global Convertible Bond Fund’s investment universe is subject to the following two exclusion criteria.

1. Norms-based screening

This ensures that potential investee companies that are involved in controversial practices are excluded from investment. We take into account the UN’s Global Compact, International Labour Organisation and Human Rights violations in this process.

2. Exclusions

We also exclude companies we believe have a negative impact on the world by virtue of their business activities. We exclude companies that derive a certain percentage of their revenues from the following activities.

Thermal coal production and distribution

Tobacco production and distribution

Adult entertainment

Military hardware

It should be noted that exclusions do not apply to short positions.

Stage 2 – Alignment Framework

Seeking positive alignment to our ESG framework

The framework considers the alignment of companies issuing convertible bonds with the United Nations Sustainable Development Goal 8: Decent Work and Economic Growth. We see a strong parallel between the aims of SDG Goal 8 and the essential characteristics of the Fund’s investment selection process.

We have identified eight sustainability indicators, listed below. We analyse potential investments against these eight indicators and determine either alignment or mis-alignment. From this analysis we are able to determine the quantum of alignment and so calculate an alignment score. We are then able to construct a portfolio ensuring that the majority of the portfolio is positively aligned to our ESG framework.

Promotion of Economic Growth

Support companies generating positive economic impacts.

Drive Innovation, Progress and Productivity

Support companies driving developing technologies that improve economic productivity and labour productivity.

Job Creation and Entrepreneurship

Support companies whose activities improve labour market dynamics and contribute to breadth of economic performance.

Resource Efficiency and Environmental Protection

Support companies who are improving resource efficiencies and whose activities do not contribute to environmental degradation.

Equality of Opportunity

Support companies providing equal opportunity and who do not contribute to exploitation of labor.

Access to Financial Services and Insurance

Support companies whose reach and intent enables lower cost or increased access to financial services.

Youth Unemployment

Support skills growth and wealth creation opportunities in the younger generation.

Sustainable Tourism

Support responsible travel that benefits, rather than exploits, the communities in which it occurs.

Stage 3 - Investment Integration

Sustainability inherent to our modelling process

Sustainability considerations play an integral role in our expectation of risk and opportunity of each prospective investment. This is manifested within our fundamental modelling process in three key ways; (i) the use of credit spreads to reflect the risk of near- and medium-term cash flow and repayment certainty, (ii) determining the appropriate weighted average cost of capital and (iii) making forward projections over our seven-year forecast horizon.

Related Insights

Global Convertible

Where do we go from here?

Stephen McCormick, David Keetley

22 Nov 2024

Global Convertible

Convertibles outlook

Stephen McCormick, David Keetley

29 Jul 2024

Global Convertible

Convertibles in 2024: Four reasons to be cheerful

Stephen McCormick, David Keetley

3 Jan 2024

Get the latest insights sent straight to your inbox

Countries in which this fund is available

Please click on each country to see share class availability

Risks:

Capital is at risk and there is no guarantee the Fund will achieve its objective. Investors should make sure their attitude towards risk is aligned with the risk profile of the Fund before investing.

Past performance is not a reliable guide to future performance. The value of investments may go down as well as up and you might get back less than you originally invested as there is no guarantee in place.

The value of a fund’s assets may be affected by uncertainties such as international political developments, market sentiment, economic conditions, changes in government policies, restrictions on foreign investment and currency repatriation, currency fluctuations and other developments in the laws and regulations of countries in which investment may be made. Please see the Fund’s Prospectus for details of all risks.
The Fund invests in equities, convertible and fixed income securities and prices can rise or fall due to several factors affecting global stock markets.
The Fund uses derivatives which carry the risk of reduced liquidity, substantial loss, and increased volatility in adverse market conditions, such as failure amongst market participants. The use of derivatives will result in the Fund being leveraged (where market exposure and the potential for loss exceeds the amount the Fund has invested) and in these market conditions the effect of leverage will magnify losses. The Fund makes extensive use of derivatives.
The Fund invests in assets denominated in currencies other than the Fund's base currency. Changes in exchange rates may have a negative impact on the Fund's investments. If the share class currency is different from the currency of the country in which you reside, exchange rate fluctuations may affect your returns when converted into your local currency. Hedged share classes may have associated costs which may impact the performance of your investment.
There may be times where the issuer or guarantor of a fixed income (or convertible) security cannot meet its payment obligations or has their credit rating downgraded, resulting in potential losses for the Fund.
The Fund invests in emerging markets where there is a greater risk of volatility due to political and economic uncertainties, restrictions on foreign investment, currency repatriation and currency fluctuations. Developing markets are typically less liquid which may result in large price movements to the Fund.