US Core Fixed Income
Schroders Core Fixed Income strategy seeks to outperform the Barclays US Aggregate Index by 75 basis points (before fees) over an investment cycle.
The strategy seeks to generate return by investing across the full maturity spectrum of investment grade US fixed income securities, including US Treasury, agency, securitized and corporate debt. The strategy focuses on active sector rotation and security selection, duration and yield curve strategies. We use a team approach in constructing investment strategy and portfolio decisions are supported by extensive fundamental, technical and quantitative research. Sector specialist portfolio managers execute investment strategy using a relative value framework, with the goal of capitalizing on opportunities across a wide range of market conditions.
Schroders’ Core Fixed Income strategy typically maintains portfolio duration at +/- 10% of the duration of the benchmark.
The US Multi-Sector Fixed Income team is made up of several New York based portfolio managers dedicated to value-oriented fixed income investing, and are supported by an experienced team of more than 30 global credit analysts, with geographical and industry expertise.
- Fixed income markets are global, interrelated and generally efficient but can overreact to events, creating investment opportunities
- We believe that a globally integrated team of research-driven bond investors is the ideal structure to take advantage of these opportunities
- Using a disciplined investment process and diversified strategies, we seek to generate consistent above benchmark returns with lower than average volatility
Our fixed income process consists of four distinct steps:
- Conduct in-depth proprietary market research (fundamental, quantitative and technical) to develop investment themes that we feel will dominate markets over the ensuing three to six month period
- Develop and prioritize investment strategies, based on investment themes, which will determine optimal portfolio positioning in three primary areas of the market: duration, yield curve exposure, and sector allocation
- Implement investment strategies within the portfolio, using a relative value framework to prioritize investment ideas and select securities.
- Continually review portfolio within rigorous risk management framework
The cornerstone of our investment process is our weekly US fixed income strategy meeting. Sector specialist portfolio managers combine the outputs from our economic, quantitative and global credit research with bottom-up issuer research to establish investment themes and resulting strategies. Macro strategy, sector allocations and overall risk budgeting are determined at this meeting. Portfolio construction, including security selection, follows and is implemented by our portfolio managers.
- Research-driven process
- Fundamental credit opinion, backed by state of the art quantitative tools
- Relative-value approach to decision making
- Experienced, specialist portfolio managers and analysts
- Risk budget varies based on expected returns, volatility and confidence
- Opportunistic, nimble approach in changing market conditions
- Separate Accounts