Aggregate Fixed Income
Key points:
- Flexibility to exploit opportunities across the global fixed income universe
- Integrated ESG approach to country and issuer selection
- A strict focus on risk management resulting in limited drawdowns and low volatility
Philosophy
There is considerable divergence in performance between the various segments of the fixed income universe over time; a winner one year is often a laggard the next. The strategy’s overarching investment philosophy is based on the premise that these wide performance discrepancies represent opportunities that dynamic investors can exploit, because global fixed income markets and benchmarks are inefficient. In our view it is vital to invest across these markets according to a flexible, benchmark-unaware approach.
Process
Step 1: Analysis. Top-down global macroeconomic analysis and research into market themes and bottom-up country and company research, which includes ESG analysis.
Step 2: Cross-asset fixed income strategy selection. Selection and duration positioning, country, yield curve and currency positioning, and issuer selection.
Step 3: Portfolio construction and risk management. Risk & reward analysis and portfolio construction.
Step 4: Implementation. Efficient execution of trades. In addition to the global strategy, a European aggregate fixed income variant is also available.
Team
The strategy is managed by cross-asset portfolio managers who are responsible for the overall decisions, including the cross-asset strategy selection, duration, and yield curve, country and currency positioning. They use the insights and portfolio management expertise of the other fixed income portfolio managers, analysts and researchers who cover global investment grade credit, high yield, government bond, asset-backed securities (ABS), inflation-linked bonds and emerging market debt.
