The strategy invests, and dynamically manages a mix of high grade, high yield and international fixed income sectors. The investment team employs an investment process that combines top-down macro analysis to shape the overall posture of the strategy while empowering individual “sleeve” managers to select securities.
Positioning is guided by top-down views on macroeconomic environment and credit cycle dynamics. The team attempts to identify areas where broad macro trends and relative value opportunities intersect. The team assesses the relative attractiveness of each idea with the use of a balanced set of fundamental and quantitative inputs. They apply a disciplined risk budgeting process and use derivatives that can tactically hedge unwanted risks. The lead portfolio manager ultimately decides overall asset allocation.
- Seek to identify the primary and secondary risks of each investment
- Separation of views with respect to currency, rates, and credit
- Bottom-up, fundamental research seeks to mitigate credit risk
- Use of diversified sectors (sleeves) to potentially reduce volatility
- Control for macro risks at the portfolio level through an overlay process
Firm Level: Independent Risk Management Team
- Performs comprehensive portfolio reviews with investment team and senior management
- Monitors individual security holdings across the entire firm