Global Fixed Income Compass
Quarterly insight from our fixed income teams to help clients navigate the markets and opportunities ahead.
INVESTMENT STRATEGIES
Core Plus
Jump to a section
Overview
We believe a bottom-up, fundamentally driven investment process can generate risk-adjusted outperformance and capital preservation over time. Our comprehensive bottom-up view drives decision making at a macro level, enabling us to make informed risk and sector allocation decisions.
Investment Approach
- By emphasizing risk-adjusted returns and capital preservation, the portfolio can serve as a foundation for a fixed income allocation. The strategy uses a bottom-up, fundamentally driven investment process that seeks to identify the best opportunities across fixed income sectors, including up to 35% high yield.
- Partnership and fluid communication between fixed income and equity analysts promote idea generation. Credit research emphasizes free-cash-flow generation, quality of management and security valuation.
- Our proprietary fixed income portfolio and risk-management system, Quantum Global, is integrated into the investment process at each step. We identify and measure the sources of risk in the portfolio at multiple levels to confirm that the portfolio is positioned as intended.
Dynamic Core Bond Holding
Integrated Research
Sophisticated Risk Management
Working to be Consistently Good… Not Occasionally Great
CORE PLUS BOND COMPOSITE OUTPERFORMED THE BLOOMBERG BARCLAYS U.S. AGGREGATE BOND INDEX 120 OF 120 PERIODS, OR 100% OF THE TIME
ANNUALIZED MONTHLY ROLLING THREE-YEAR RETURNS *
* Returns based on 10-year time frame ending 6/30/19
Portfolio Management
Featured Insights
Mitigating Risk as Cracks in the Credit Cycle Emerge
Head of Fundamental Fixed Income Darrell Watters highlights the importance of mitigating downside risk as the credit cycle continues to progress in 2019.
Thoughts and Bonds: The Beginning of the End
Our Fundamental Fixed Income team provides insights on potential investment risks and opportunities, and shares our global outlook for the quarter ahead.
Performance
RETURNS
| Inception: Jan 01, 1993 | 3M | YTD | 1YR | 3YR | 5YR | 10YR | Since Inception |
|---|---|---|---|---|---|---|---|
| Composite Gross | 2.65% | 9.53% | 10.05% | 3.38% | 3.56% | 4.86% | 6.90% |
| Composite Net | 2.56% | 9.25% | 9.67% | 3.03% | 3.23% | 4.55% | 6.39% |
| Bloomberg Barclays U.S. Aggregate Bond Index | 2.27% | 8.52% | 10.30% | 2.92% | 3.38% | 3.75% | 5.43% |
| Inception: Jan 01, 1993 | 3M | YTD | 1YR | 3YR | 5YR | 10YR | Since Inception |
|---|---|---|---|---|---|---|---|
| Composite Gross | 2.65% | 9.53% | 10.05% | 3.38% | 3.56% | 4.86% | 6.90% |
| Composite Net | 2.56% | 9.25% | 9.67% | 3.03% | 3.23% | 4.55% | 6.39% |
| Bloomberg Barclays U.S. Aggregate Bond Index | 2.27% | 8.52% | 10.30% | 2.92% | 3.38% | 3.75% | 5.43% |
Past performance cannot guarantee future results. Investing involves risk, including the possible loss of principal and fluctuation of value. Returns greater than one year are annualized. Returns are expressed in U.S. dollars. Composite returns are net of transaction costs and gross of non-reclaimable withholding taxes, if any, and reflect the reinvestment of dividends and other earnings.
The gross performance results presented do not reflect the deduction of investment advisory fees and returns will be reduced by such advisory fees and other contractual expenses as described in the individual contract and Form ADV Part 2A.
Net performance results do not reflect the deduction of investment advisory fees actually charged to the accounts in the composite but they do reflect the deduction of model investment advisory fees based on the maximum fee rate in effect for the respective time period, adjusted for performance-based fees where applicable. Actual advisory fees may vary among clients invested in the strategy shown and may be higher or lower than model advisory fees. Returns for each client will be reduced by such fees and expenses as negotiated in any client contract as discussed in Form ADV Part 2A.
For a complete list of holdings as of the most recently available disclosure period, contact us.
The gross performance results presented do not reflect the deduction of investment advisory fees and returns will be reduced by such advisory fees and other contractual expenses as described in the individual contract and Form ADV Part 2A.
Net performance results do not reflect the deduction of investment advisory fees actually charged to the accounts in the composite but they do reflect the deduction of model investment advisory fees based on the maximum fee rate in effect for the respective time period, adjusted for performance-based fees where applicable. Actual advisory fees may vary among clients invested in the strategy shown and may be higher or lower than model advisory fees. Returns for each client will be reduced by such fees and expenses as negotiated in any client contract as discussed in Form ADV Part 2A.
For a complete list of holdings as of the most recently available disclosure period, contact us.
Commentary & Literature
2Q19 Portfolio Commentary Highlights
- As the Fed’s pivot to a more accommodative stance evolved into potential rate cuts in 2019, both Treasuries and corporate credit performed well in the second quarter.
- The Portfolio outperformed its benchmark, with our positioning in both investment-grade corporates and Treasuries contributing to relative results.
- Macro uncertainties, including slower global growth and trade tensions, will likely lead to more accommodative monetary policy from the Fed and other developed world central banks.