Managing fixed income allocations in turbulent times
After years of a stable and relaxed fixed income market, investors are suddenly faced with market turmoil that could upset their bond allocations. Alternative bond strategies could provide investors with a bulwark against the challenges ahead.
In the next webcast, Managing fixed income allocations in turbulent timesBilal Memon, Portfolio Manager, Northern Trust Asset Management, will outline the challenges facing many fixed income investors today and highlight bond fund strategies that could help financial advisers tailor their clients’ portfolios to respond to this particularly unruly market.
For example, active management FlexShares Core Select Bond Fund (NYSEArca: BNDC) seeks to provide an attractive risk-adjusted return by investing in a portfolio of fixed income securities and is designed to achieve optimum return potential. In addition, the active component will adjust to potential changes in interest rate levels, the shape of the yield curve and credit spread relationships while emphasizing liquidity and diversification.
Through its active management style, NBDC seeks total return and preservation of capital. The fund invests at least 80% of its net assets in high quality fixed income securities denominated in US dollars directly or indirectly through exchange traded funds and other registered investment companies.
“We are building the BNDC fund to include a consistent risk profile designed to provide stable sector exposures and duration, tactical adjustments to help manage risk and seize potential opportunities, providing access to institutional securities expertise to Northern Trust’s fixed income exposure to advice to potentially help manage the threat of inflation and fine-tune the fund’s portfolio through a small number of ETF transactions, rather than dozens of transactions involving individual securities “, according to FlexShares.
“Our belief is that building a portfolio of ETFs also allows managers to more effectively adjust the composition of the fund. This structure allows fund managers to express their current views on fixed income market developments, which can help investors seize opportunities while managing risk.
Financial advisors interested in learning more about fixed income strategies can register for the Tuesday, June 21 webcast here.