Two key figures of the DJE - Zins & Dividende are currently 3.2% and 2.6%. This is the current coupon of the bond part and the current dividend yield of the equity part in the fund's overall portfolio. The balanced mixed fund links these current yields with possible share price gains, which include "green" shares.
The balanced mixed fund DJE - Zins & Dividende shows a positive performance as of 17.11.2020 (-> daily performance). After the fund management had significantly reduced the equity allocation in February / March 2020 it has meanwhile returned to around 50%. The bottom of the equity ratio was reached at the end of March by this time the fund was temporarily only invested 20-25% in equities.
Yields on corporate bonds, US and Chinese government bonds
At the same time US government bonds were highly weighted on the bond side at that time. With the announcement of massive global fiscal programs and the very expansive policies of the most important central banks the equity ratio was also raised again in April and May. On the bond side price gains were achieved in US government bonds and successively invested in selected corporate bonds.
As of 30 October 2020 15% of the bond side consisted of government bonds and 37% of corporate bonds. Among government bonds Chinese RMB bonds with attractive interest rates are now also becoming more important. Overall the average credit rating in the bond segment is currently BBB+ with a duration of just under three years. The average coupon on the bond portfolio is around 3.2%.
Price potential for value stocks and tech stocks
On the equities side we have currently an overweight in "quality/momentum" sectors such as financial services or food & beverages, among others, but there are also larger weightings in classic "value sectors" such as commodities / basic materials, chemicals or insurance. These value sectors in particular should offer greater upside potential in 2021 if the economy improves. In absolute terms the technology sector also has a higher weighting of around 6% of the NAV. Structurally this sector remains interesting due to the still considerable growth potential, the mainly very good balance sheets and high cash generation of the companies.
Green stocks and Asia with opportunities
Underweighted or less prominently represented in the DJE - Zins & Dividende are currently mainly the banking sector and the oil and gas segment. With regard to oil and gas the fund management decided long ago to abandon the traditional oil and gas producers to concentrate instead on high-growth companies from the renewable energy segment. For example, so-called "green shares" of wind farm operators and turbine manufacturers are important individual investments for the fund. Looking ahead to 2021 we also believe that the Asian investment region offers good opportunities. Its weighting is currently around 9%. In general the valuation of the Asian stock markets is low by international standards and growth is high.
In total the DJE - Zins und Dividende equity portfolio currently comprises almost 70 individual securities. The average dividend yield is around 2.6% at the moment and is more than covered by an average free cash flow yield of over 5%. In our opinion the balanced mix of sectors with structural and often largely non-cyclical growth potential and (cyclical) value stocks is currently a good mix for coping with the COVID pandemic while at the same time taking advantage of possible recovery opportunities.
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Note: All information published is for your information only and does not constitute investment advice or other recommendation. Long-term experience and awards do not guarantee investment success. Securities are subject to market-related price fluctuations which may not be compensated for by the active management of the asset manager or investment advisor. This information cannot replace a personal consultation. All information has been provided with care and to the best of our knowledge at the time of preparation. Despite all due care the data may have changed in the meantime. Further information on opportunities and risks can be found on the website www.dje.de. The sales prospectus and further information are available free of charge in German from DJE Investment S.A. or at www.dje.de The fund management company is DJE Investment S.A. DJE Kapital AG is the distribution agent.