Fixed Income Monthly Comments - may 2026

‍Strata Credit Fund

During May, credit markets remained driven by a combination of geopolitics, shifting central bank expectations and the continued strength of the AI-led equity rally. In the near term, attention is focused on geopolitical evolution on Iran, where any indication of a ceasefire extension, a full reopening of the Strait of Hormuz or sanctions relief could meaningfully affect oil prices, bond yields and broader risk sentiment. While tensions and mistrust remain elevated, even modest progress could support markets.

At the same time, the macro backdrop is becoming less supportive: the ECB is increasingly expected to hike in June as more policymakers adopt a hawkish tone, while the Bank of England faces a difficult balancing act as rising UK energy prices offset the benefit of softer inflation. In the US, data flow should reinforce the FED’s growing confidence that labour market is stabilising underpinning an already hawkish Federal Reserve pricing. Global equities, meanwhile, continue to reach new highs, supported by a broadening rally in semiconductors and artificial intelligence. However, valuations are becoming stretched, and concerns are emerging over how sustainable this momentum may prove, particularly as elevated AI capital expenditure begins to compete with shareholder returns. In parallel, oil prices have softened on cautious optimism around a possible Iran agreement despite ongoing skirmishes, offering some stabilisation to bond markets.

Against an increasingly complex market backdrop, the fund remains positioned with a measured and highly adaptable mindset. Activity in the broader market has been concentrated in primary issuance where issuers offered some premium versus secondary.

We continue to emphasise rigorous security selection while preserving a meaningful level of liquidity to retain optionality and respond effectively to dislocations as they arise. Portfolio construction remains intentionally barbelled, combining an elevated cash allocation with predominantly shorter-duration exposures, while downside protection is further reinforced through the selective use of hedging strategies designed to dampen the impact of episodic volatility.

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Global Bond Total Return

Global bond markets navigated a complex landscape in May, balancing geopolitical developments and shifting central bank expectations. US 10-year Treasury yields experienced periods of volatility but stabilised to end the month near 4.45%. European rates saw a more supportive rally, with the German 10-year Bund yield falling approximately 10 basis points to close the month at 2.93%.

In foreign exchange, the US Dollar strengthened marginally, with the EUR/USD exchange rate weakening slightly over the month to settle around 1.165. Meanwhile, global corporate bonds demonstrated continued resilience, as investment grade credit spreads tightened further to historically low levels.

At the portfolio level, our interest rate positioning was the primary driver of returns, accounting for more than 70% of the positive performance. This was a direct result of our elevated duration posture successfully capturing the rally in core European yields and the stabilisation of US rates. The remainder of the fund's positive performance was generated by our credit allocations, which benefitted directly from the supportive backdrop and spread tightening, while FX impacts were unchanged.

In terms of portfolio activity, no adjustments were made during the month of May. We maintained our strategic positioning, leaving overall duration close to a 5-year high to continue capturing the attractive yield environment.

At month-end, the RAM (Lux) Tactical Funds – Global Bond Total Return Fund’s (Class B USD*) maintained a duration of 5.3 years, an average credit quality of AA-, and a yield of 5.15%.**

*The performance is gross of management fees and operational costs (0.60% management fee and 0.40% of operational costs, for a TER of approximately 1%). Past performance is not a reliable indicator of future returns.

** Credit Rating: is a parameter used by banks and lending institutions to determine whether an applicant is deserving of the confidence necessary for the granting of a loan. This parameter makes it possible to measure the risk of consumer default and determine the economic conditions applicable to consumers. The highest rating is indicated by the letters: AAA. This is the indication of highest financial security. This is followed by: AA, A, BBB, BB, etc. The lowest credit rating corresponds to the letter C. This letter identifies a high risk of financial default and is a figure taken into great consideration by each lending institution.

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Legal Disclaimer

The Strata Credit Fund is a Sub-Fund of RAM (Lux) Tactical Funds II, a Luxembourg SICAV with registered office: 14, Boulevard Royal L-2449 Luxembourg, approved by the CSSF and constituting a UCITS (Directive 2009/65/EC). The sub-fund STRATA CREDIT FUND was created in the RAM (LUX) Tactical Funds II SICAV to receive the PALLADIUM FCP – RAM Mediobanca Strata UCITS Credit Fund sub-fund. The transfer was effective on 30th May 2024.

Please note that the performance shown reflects periods before the Sub-Fund’s transfer and was achieved under different regulatory and operational conditions, which may no longer apply. Notwithstanding this, the performance is based on investment objectives and policies that have not materially changed following the sub-fund's transfer and is attributable to investment objectives, policies, restrictions, and strategies that are compliant with UCITS regulations. The investment management function remains consistent, with no changes to the team responsible for managing the fund after the transfer. Importantly, there has been no material change in the level of fees charged to investors as a result of this transfer. For further information, please refer to the Prospectus.

The RAM (Lux) Tactical Funds – Global Bond Total Return is a Sub-Fund of RAM (Lux) Tactical Funds a Luxembourg SICAV with registered office: 14, Boulevard Royal L-2449 Luxembourg, approved by the CSSF and constituting a UCITS (Directive 2009/65/EC).

Please note that the share classes mentioned in this document may not be registered in your country of domicile.

This marketing document is only provided for information purposes to professional clients, and it does not constitute an offer, investment advice or a solicitation to subscribe shares in any jurisdiction where such an offer or solicitation would not be authorised or it would be unlawful. In particular, the Funds are not offered for sale in the United States or its territories and possessions, nor to any US Person (citizens or residents of the United States of America).

This document is confidential and is intended only for the use of the person to whom it was delivered; it may not be reproduced or distributed.

There is no guarantee that the holdings shown will be held in the future. The investment described concerns the acquisition of shares in the Sub-Fund and not in a specific underlying asset.

Past performance is not a guide to current or future results. There is no guarantee to get back the full amount invested. The performance data do not take into account fees and expenses charged on subscription and redemption of shares nor any taxes that may be levied. As a subscription fee calculation example, if an investor invests EUR 1000 in a fund with a subscription fee of 5%, the investor will pay to his financial intermediary EUR 50.00 on the investment amount, resulting with a subscribed amount of EUR 950.00 in fund shares. In addition, potential account keeping costs (by investor’s custodian) may reduce the performance. Some shares in the Sub-Fund apply a performance fee. Leverage intensifies the risk of potential increased losses or returns.

The Management Company may decide to terminate the marketing arrangement in place in any given country in accordance with Article 93a of Directive 2009/65/EC.

Changes in exchange rates may cause the NAV per share in the investor's base currency to fluctuate.

Particular attention is paid to the contents of this document but no guarantee, warranty or representation, express or implied, is given to the accuracy, correctness or completeness thereof.

Prior to any transaction, clients should check whether it is suited to their personal situation, and analyse the specific risks incurred, especially financial, legal and tax risks, and consult professional advisers if necessary.

Please refer to the Key Investor Information Document and prospectus with special attention to the risk warnings before investing. This Sub-Fund is classified as art.8 SFDR. For further information on ESG, please refer to

https://www.ram-ai.com/en/regulatory-information and the relevant Sub-Fund webpage, section "Sustainability-related disclosures".

The prospectus, constitutive documents and financial reports are available in English and French while PRIIPs KID are available in the relevant local languages. These documents can be obtained, free of charge, from the SICAVs’ and Management Company’s head office and www.ram-ai.com, its representative and distributor in Switzerland, RAM Active Investments S.A. and the relevant local representatives in the distribution countries.

Issued in Switzerland by RAM Active Investments S.A. which is authorised and regulated in Switzerland by the Swiss Financial Market Supervisory Authority (FINMA). Issued in the European Union and the EEA by the authorised and regulated Management Company, Mediobanca Management Company S.A. 2 Boulevard de la Foire, 1528, Luxembourg, Grand Duchy of Luxembourg.

The source of the above-mentioned information (except if stated otherwise) is RAM Active Investments and the date of reference is the date of this document.

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Swiss representative: Swiss Paying Agent:

RAM Active Investments S.A. CACEIS Bank, Montrouge, succursale de Nyon/Suisse

Rue du Rhône 8 Route de Signy 35

CH-1204 Genève CH-1260 Nyon

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