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Investment Approach

The strategy seeks to generate a high level of current income and preserve principal by investing primarily in high-quality, short-term fixed-income securities. The strategy focuses on high-quality issues in an effort to maximize yield, manage risk and limit price volatility. Portfolios seek competitive risk-adjusted returns over time by avoiding excessive interest-rate bets, and aim to outperform the Bloomberg Barclays US 1–3 Year Govt/Credit Index, as well as the ICE BofAML 1–3 Year US Treasury Index, in a variety of economic environments.

Distinguishing Features

  • Tenured and experienced fixed-income team over multiple interest-rate-cycles
  • Disciplined process incorporates qualitative and quantitative inputs
  • Focus on minimizing volatility in the context of a diversified, high-quality portfolio (AA or better)
  • Management focused on client service and institutional needs
  • A history of strong risk-adjusted performance over time versus benchmark and peers

Investment Process

Top-down assessment
  • Macro assessment
  • Relative value of sectors

Potential result: Well-diversified portfolio composed of high-quality securities

Research and analysis
  • Relative yield vs. market
  • Cash-flow certainty
  • Fundamental outlook

Potential result: Candidates for purchase within targets for sectors, duration and yield-curve positioning

Client portfolio construction
  • Rolling down the curve
  • Break-even analysis
  • Scenario testing

Potential result: Well-diversified portfolio composed of high-quality securities

Monitoring and risk management
  • Tactical adjustments
  • Daily pre- and post-trade compliance

Potential result: Positioning that seeks to outperform on a risk-adjusted basis