Download investment grade infrastructure bond fund

INVESTMENT GRADE
INFRASTRUCTURE BOND FUND
Overview
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Actively managed portfolio comprised primarily of Investment Grade fixed income securities of issuers that own, operate
or develop infrastructure assets in the United States
•
Portfolio managed by Nuveen Asset Management, LLC (“Nuveen” or the “Portfolio Manager”)
Investment Grade Bonds
Monthly Cash Distributions
(5% Initial Target Yield)
(Average rating of A)
Duration and Active Currency
Management
Infrastructure – The Essential Backbone of Economic Activity
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Toll Roads
Bridges
Rail
Ports
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K-12 Schools & Universities
Hospitals
Public Works
Government Buildings
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Pipelines
Electricity
Water Infrastructure
Renewable Energy
Waste and Sewage Treatment
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Broadcast and Wireless Towers
Satellite Systems
Investment Highlights
Strong Infrastructure Debt Experience of Nuveen
•
Nuveen has approximately $130 billion of assets under management as at September 30, 2014, including ~$95 billion in
infrastructure debt securities, making them one of the largest active managers of infrastructure debt in the world
•
The Portfolio Manager believes that the dynamics of the infrastructure debt markets have been shifting over the past
several years, creating new advantages for institutional investors with expertise in investing in infrastructure
Opportunities in the Infrastructure Debt Market
•
The Portfolio Manager believes that infrastructure debt offers investors a more attractive risk / return profile than
equivalently rated corporate bonds
•
Despite historically lower default rates, the infrastructure debt market has historically paid higher yields than corporate
investment grade bonds and therefore provides attractive valuations versus corporate bonds
 Opportunity to capitalize on market inefficiencies
 More highly rated
 Compelling yield
opportunity

Attractive valuations
 Resilient in uncertain
market conditions
Infrastructure Debt has Offered Attractive Returns
•
The following chart illustrates the average rating, yield and duration on an indicative basis if the Portfolio had existed on
December 12, 2014
Average Rating
Yield to Worst
Duration
A
5.04%
5.50 years
Barclays Long Term Corporate Bond Index
A- / BBB+
4.47%
13.67 years
Barclays Corporate Index
A- / BBB+
3.15%
7.23 years
Investment Grade Infrastructure Bond Fund
Duration and Active Currency Management
•
Nuveen will seek to reduce the risk of rising interest rates by maintaining, under normal market conditions, a weighted
average Portfolio duration of not more than six years
•
Currency exposure will be actively managed by Fiera Capital
Disclosure: This fact sheet shall not constitute an offer to sell or the solicitation of an offer to buy, nor shall there be any sale or any acceptance of an
offer to buy these securities in any province or territory of Canada. This offering is only made by prospectus. The prospectus contains important detailed
information about the securities being offered. Copies of the prospectus may be obtained from your financial advisor using the contact information for
such advisor. Investors should read the prospectus before making an investment decision. This investment may not be suitable for all investors.
Commissions, trailing commissions, management fees and expenses all may be associated with this Investment. An investment in the Fund is not
guaranteed, its value changes frequently and past performance may not be repeated.
Investment Highlights – Continued
Infrastructure Debt Securities Have Been Resilient During Uncertain Market Environments
•
The infrastructure industry is characterized by attractive fundamentals, including: inelastic demand, high barriers to
entry, stable long-term cash flows, and low historical default rates
•
Infrastructure debt has historically not shown the significant upticks in defaults that corporate credits have
experienced in market downturns and recessionary environments
•
As shown in the chart below, infrastructure debt has generated an average annualized return of 5.6% since 2000
with relatively low volatility
Annualized Returns of Infrastructure Debt throughout Market Events
14%
12%
Corporate
Accounting
Scandals
11.7%
Debt Ceiling
USA Downgrade
12.9%
10.7%
9.6%
10%
8%
9/11
Attacks
6%
5.2%
Fed Funds Rate
Raised 17 times
5.3%
4.5%
4%
3.5%
8.3%
Municipal
Default
Scare
4.8%
3.4%
2.4%
Liquidity
Crisis
2%
6.8%
Taper
Tantrum
0%
-2%
-4%
2000
2001
2002
2003
2004
2005
2006
2007
(2.3%)
(2.5%)
2008 2009
2010
2011
2012
2013
Barclays Municipal Bond Index Return. Bloomberg as at October 31, 2014.
2014
YTD
Nuveen’s Well-Established Investment Process
•
•
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Nuveen will seek to identify underrated and undervalued securities and sectors by using a team-based and research
driven investment process
Nuveen focuses on bottom-up, fundamental analysis of issuers, but also considers top-down, macro conditions and
technical factors that may affect liquidity, valuations, and the prospective investment environment
The following charts illustrate the composition of the Portfolio in respect of the credit rating distribution and sector
distribution on an indicative basis if the Portfolio had existed on December 12, 2014
By Sector
Oil/Gas
5.0%
Education
4.7%
Public Buildings
7.0%
By Credit Rating
AAA
5%
Waste
3.0%
Transportation
30.6%
Below
BBB20%
Healthcare
8.3%
Other
9.4%
Public Improvements
10.3%
BBB
5%
Water/Sewer
11.4%
Electric Utilities
10.3%
CIBC
National Bank Financial Inc.
BMO Capital Markets
Desjardins Securities Inc.
Canaccord Genuity
Dundee Securities Ltd.
AA
40%
A
30%
Average Rating of A
RBC Capital Markets
TD Securities Inc.
GMP Securities Inc.
Raymond James Ltd.
Mackie Research Capital Corporation Manulife Securities Incorporated
Scotiabank
Disclosure: This fact sheet shall not constitute an offer to sell or the solicitation of an offer to buy, nor shall there be any sale or any acceptance of an
offer to buy these securities in any province or territory of Canada. This offering is only made by prospectus. The prospectus contains important detailed
information about the securities being offered. Copies of the prospectus may be obtained from your financial advisor using the contact information for
such advisor. Investors should read the prospectus before making an investment decision. This investment may not be suitable for all investors.
Commissions, trailing commissions, management fees and expenses all may be associated with this Investment. An investment in the Fund is not
guaranteed, its value changes frequently and past performance may not be repeated.