Multi-Sector Core Plus


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Multi-Sector Core Plus Strategy

The strategy seeks to generate high total return from both current income and capital appreciation by investing primarily in intermediate-term debt securities across 14 fixed income sectors. The strategy employs a time-tested approach of active sector rotation, extensive credit research and disciplined risk management designed to capitalize on opportunities across undervalued areas of the fixed income markets. A team of investment professionals provides significant research depth across all bond market sectors.

Investment Process

Step 1 - Sector Analysis and Allocation

  • Top down, relative value approach
  • Relative value analysis looks at: yield and spreads; supply and demand; investment environment; sector fundamentals

Step 2 - Issue Selection

  • Bottom up, fundamental research driven
  • Fundamental analysis includes assessment of: credit risk; company management; issue structure; technical market conditions; focus on valuations

Step 3 - Portfolio Construction, Oversight, and Risk Management

  • Duration neutral strategy
  • Sector concentration
  • Issuer exposure: maximum 5%, average <1%
  • Manager review
  • Systematic review

Strategy Risk

Debt securities are subject to various risks, the most prominent of which are credit and interest rate risk. The issuer of a security may fail to make payments in a timely manner. Values of debt securities may rise and fall in response to changes in interest rates. This risk may be enhanced with longer-term maturities.

Changes in interest rates can cause both extension and prepayment risks for asset and mortgage-backed securities. These securities are also subject to risks associated with the repayment of underlying collateral.

Investing internationally, especially in emerging markets, involves additional risks such as currency, political, accounting, economic, and market risk.

There is a greater level of credit risk and price volatility involved with high yield securities than investment grade securities.

Portfolio Team

David L. Albrycht, CFA
Industry Start Date: 1985
Stephen H. Hooker, CFA
Stephen H. Hooker, CFA
Industry Start Date: 1993

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