Fixed Income Investment Process
Fixed Income Management Philosophy and Goals
We believe value can be uncovered by disciplined analysis and excess returns can be generated through active management. Furthermore, it is also our perspective that:
- Meaningful market opportunities present themselves not only along the yield curve, but also between sectors and individual securities.
- A judicious balance between selectivity and diversification across strategies can produce consistent out-performance and mitigate risk.
Our objective is to generate high rates of total return with the primary objective of capital preservation. We aim to achieve this by ensuring each fixed-income portfolio is diversified among a variety of investment-quality fixed income securities.
How we enhance fixed income returns
We design our portfolios to perform against a wide variety of client benchmarks and to meet specific client requirements. We do this by:
- Strategic structuring of portfolio duration and yield curve positioning: Based on fundamental analysis of indicators for economic growth, and monetary and fiscal dynamics, we anticipate changes in interest rates and position portfolios accordingly.
- Deliberately covering a wide range of maturities: We invest portfolios primarily in U.S. Treasury and Agency issues, investment-grade U.S. corporate issues and municipal bonds and mortgage-backed securities based on their quality and relative value.
- Selecting securities based on our proprietary quality ratings: We rely on our proprietary quality ratings to identify issues with strong financial strength ratings and invest in issues that, in addition, have good liquidity and structural properties.