Bellevue Global Income

The fund returned +0.52% in February with a volatility of 0.7%, compared to the Bloomberg Global Aggregate EUR-Hedged Index, which rose 1.28%.

This month, credit contributed +0.08% and government bonds +0.44%. Financial markets remained constructive overall, but beneath the major indices there were areas of volatility. Credit underperformed the broader market due to exposure to Brazilian corporates weighing on performance. Government bonds benefited from the position in long-term German government bonds, as the Bund yield declined by -20 bps to 2.64%.

Throughout the month, within credit, we slightly increased the allocation from 61% to 63%, adding investments in Europe and Brazil ahead of bond redemptions. We invested in France-based Eutelsat EUR 6.25% due 2033 (yield-to-maturity 5.9%, rated BB-) and Brazil-based LD Celulose USD 7.95% due 2032 (yield-to-maturity 6.6%, rated BB-). Both issuers own unique assets that make them resilient in the event of stress. The allocation to long-term government bonds remained broadly unchanged at 33%.

We introduced a new fixed-income strategy focused on high-quality bonds with an initial allocation of 4%. These bonds, rated A to AAA, primarily consist of covered and supranational bonds. They offer a yield premium over government bonds while providing potential resilience in the event of renewed sovereign stress.

The fund currently offers a EUR yield of 3.9% with a duration of 4.7 years and an average credit rating of A.

We maintained our scenarios of January 27, 2026 as follows:

Base scenario: Broadening growth. Despite the new tariff regime, economic data are developing better than expected, with signs of recovery in Europe, particularly in Germany. Structural growth drivers such as AI and rising defense spending remain intact, although uncertainty surrounding US trade policy is increasing equity market volatility. Equity markets continue to grind higher, but returns are more volatile. Slightly positive for credit and slightly negative for government bonds.

Positive scenario: Asset melt-up. A strongly supportive economic policy mix accelerates global growth, driven by fiscal stimulus, deregulation, and affordability measures. Europe, Japan, and China also adopt more aggressive growth-oriented policies. A newly appointed, more dovish Fed Chair supports additional rate cuts. Inflation initially remains moderate thanks to productivity gains. Markets price in a stronger global outlook, leading to another leg up in equity markets. Positive for credit and negative for government bonds.

Negative scenario: Market scare. Elevated valuations leave markets vulnerable to a correction. Disappointments related to AI, stress in credit markets, and erratic US policymaking could trigger a pullback. Equity markets correct by around -20%. This scenario is negative for credit and positive for government bonds. However, we question the hedging effectiveness of long-term government bonds and assign them a reduced protective role.