drop in NTA, page-14

Typical political response without actually answering my question of why has it dropped below $2 when Prospectus stated it would hover around this figure.

Thank you for your email.

 

Just a few thoughts from our PortfolioManagers regarding recent performance:

·        Riskassets in financial markets have been volatile of late.  We are notsurprised by the performance of High Yield Corporate bonds against this marketbackdrop.

·        Importantly,HY bonds (as we would expect) are exhibiting lesser drawdown as compared toequities amidst this volatility

·        ThoughNBI’s NTA since inception is down ~2% (dividend reinvested, till end of 30 NovNTA), it is holding in better than equity: the S&P500, MSCI World and ASX200 are down ~-6% over this same period.   

·        Thedrawdown in HY bonds is reflective of a mark to market move in bondpricing.  We have not seen any credit events or defaults in ourportfolio. 

·        Historically,HY has provided lesser drawdowns and quicker rebounds as compared to equity inperiods of volatility.  We are seeing this play out in the currentenvironment.

·        Thefundamental health of the corporate bond market is strong and we continue tosee a benign default environment looking forward.  

·        Theincome stream paid to NBI is intact (we own senior bonds in performingcompanies) and thus NBI’s ability to achieve the Target Distribution isunaffected.

 

NBI Info