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Important Notes:

  1. Manulife Global Fund – Asia Total Return Fund (“Manulife Asia Total Return Fund” or the “Fund”) invests primarily in a diversified portfolio of fixed income securities issued by governments, agencies, supra-nationals and corporate issuers in Asia, which may involve Mainland China investment, Investments via Bond Connect, interest rate risk, high yield bonds, sovereign debt, emerging markets, collateralised/securitised products, volatility and liquidity, credit rating and downgrading, credit, counterparty and currency and currency repatriation risks, and is subject to greater risk than investments in more developed economies or markets.
  2. The Inc or MDIST (G) share class(es) of the Fund do not guarantee distribution of dividends, the frequency of distribution, and the amount/rate of dividends. Dividends may be paid out of income, realised capital gains and/or out of capital of the Fund in respect of Inc share class(es). Dividends may be paid out of realised capital gains, capital and/or gross income while charging all or part of their fees and expenses to capital (i.e. payment of fees and expenses out of capital) in respect of MDIST (G) share class(es). Dividends paid out of capital of the Fund amount to a return or withdrawal of part of the amount of an investor’s original investment or from any capital gains attributable to that original investment, and may result in an immediate decrease in the net asset value per share in respect of such class(es) of the Fund.
  3. The Fund intends to use financial derivative instruments (“FDIs”) for investment, efficient portfolio management and/or hedging purposes.  The use of FDIs exposes the Fund to additional risks, including volatility risk, management risk, market risk, credit risk and liquidity risk. 
  4. Investment involves risk. The Fund may expose its investors to capital loss. Investors should not base on this material alone to make investment decisions and should read the offering document for details, including the risk factors, charges and features of the Fund and its share classes.
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Asian bond: a unique market

We believe three characteristics of Asian investment grade credit may help them weather the impact from COVID-19; government or state owned issuers, domestic monetary policy support and strong local investor base. First, around 38% of the J.P. Morgan Asia Credit Index (JACI) are government or state owned1 which typically benefit from government support, especially sectors considered systematically important to the economy (e.g., railyway operators and utility providers). Secondly, most Asian issuers can issue in the local currency bond market benefit from domestic monetary easing policies. Third, Asian issuers with deep local history typically enjoy a strong and loyal local investor base.

Capture Asian bond market opportunities

Asian USD credit offer compelling yields

Asian investment grade (IG) credit offers premium yield spread to US IG credit - investors may enjoy higher yields on Asian versus developed market corporate bonds with theoretically equivalent risk exposure.

 

Historical Asian IG corporate bond yield over US IG credit2

 

Most of Asian local bonds offer relatively higher yields

We expect Asian central banks may ease further as counter-cyclical measures, which should provide a positive backdrop for Asian local bond markets.

 

Asia & developed market 10 year government bond yield3

 

Asia has a lower expected default rate

The expected default rate for Asian high yield bonds is relatively lower than other emerging markets, reflecting the region’s sound fundamentals.

 

Estimated emerging market corporate high yield bonds default rates4

 

Key features of Manulife Asia Total Return Fund

Primarily invest in investment grade with limited high yield exposure

An investment grade dominated portfolio with average credit rating at BBB (investment grade quality). Sovereign ratings of many Asian economies have upgraded over the past decade. Markets such as Philippines and Indonesia have upgraded from a high-yield to an investment grade issuer over the past decade.

 

Most of Asian markets are now of investment grade quality5

 

Blended Asian bond portfolio

Flexible strategy allocating across USD and local currency Asian bonds to exploit investment opportunities in both markets. Local currency bonds which predominately issued by Asian governments offer investors with top-down/ macroeconomic opportunities (e.g. interest rate cut cycles). With Asian USD bonds are predominately issued by corporation provide us bottom-up/bond picking opportunities.

 

The above chart is for illustration purposes only.

 

Aims at monthly distribution

The Fund aims to make monthly distributions.

 

Dividend schedule

(Dividend rate is not guaranteed. Dividends may be paid out of capital. Refer to Important Note 2.)

 

Manulife's investment expertise7

USD60+ billion

AUM8 in
Asian fixed income

 

22 years

Investment experience
by lead fund manager

 

70+

Fixed income professionals in Asia9

  1. Source: Bloomberg, as of 31 December 2020.
  2. Source: Bloomberg, as of 31 December 2020. Asian IG corporate bond is represented by J.P. Morgan Asian IG Corporate Index; US IG corporate bond is represented by BofA Merrill Lynch US IG Corporate Index.
  3. Source: Bloomberg, as of 31 December 2020.
  4. Source: J.P. Morgan, as of 31 December 2020. Projections or other forward-looking statements regarding future events, targets, management discipline or other expectations are only current as of the date indicated. There is no assurance that such events will occur, and if they were to occur, the result may be significantly different than that shown here.
  5. Source: Bloomberg, Foreign Currency Long-term Rating as of 31 December 2020. Information about the asset allocation is historical and is not an indication of the future composition.
  6. Source: Manulife Investment Management, as of 1 April 2021, refers only to Class AA (USD) Inc. Annualised yield = [(1+distribution per unit/ex-dividend NAV)^distribution frequency per annum]–1, the annualised dividend yield is calculated on the basis of the latest relevant dividend distribution and dividend reinvested, and may be higher or lower than the actual annual dividend yield. Please note that dividend is not guaranteed, and a positive dividend yield does not imply a positive return.
  7. Source: Manulife Investment Management, as of 31 December 2020.
  8. AUM = Asset under management. Include AUM in Manulife Investment Management and Manulife-TEDA Fund Management Co. Ltd., a 49% joint venture is a joint venture between Manulife Financial and Northern International Trust, part of the Tianjin TEDA Investment Holding Co. Ltd. (TEDA).
  9. Total is comprised of investment professionals of Manulife Investment Management, Manulife-TEDA Fund Management Co. Ltd., a 49% joint venture is a joint venture between Manulife Financial and Northern International Trust, part of the Tianjin TEDA Investment Holding Co. Ltd. (TEDA), and Mahindra Manulife Investment Management Private Limited, a 49% joint venture of Manulife and Mahindra AMC.

 

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