Investment Management

Fixed Income Perspectives


Fixed Income Perspectives - Counting the Days Until December

By Matt Toms, CFA, CIO, Fixed Income

We've held short duration much of the year to buffer gradually rising rates, and are staying short into year-end. We are tactically increasing investment-grade and high-yield corporate credit risk. We remain positive on securitized assets, preferring CLOs and CMBS, and are slightly overweight select emerging markets.


Unconstrained Fixed Income: Perspectives on Duration

By Matt Toms, CFA CIO Fixed Income

An unconstrained opportunity set should not equate to unconstrained risk. In this analysis, we explain why clearly defined risk tolerances, not specific return targets, are most important when approaching today's challenging fixed income markets.


Fixed Income Perspectives - Proceeding with Caution

By Matt Toms, CFA, CIO, Fixed Income

The global economy looks healthy yet uncertainty persists: geopolitical risk from North Korea, tax reform in Washington, naming a successor to Federal Reserve chair Janet Yellen and the European Central Bank's rollback of QE. We view these uncertainties as reasons to pull back risk despite strong market fundamentals.


Fixed Income Perspectives - The QE Shoe Drops, Now What?

By Matt Toms, CFA, CIO, Fixed Income

The Federal Reserve will begin reducing its holdings of Treasury and agency mortgage securities in October. Reduction will start at $10 billion per month, gradually rising to a maximum of $30 billion. The Fed is keeping the door open for a December interest rate hike.


Fixed Income Perspectives - Balance Sheet in Focus, Tightening Still on Horizon

By Matt Toms, CFA, CIO, Fixed Income

Market expectations for another hike this year have fallen below 40%, but recent economic data keep the door open: Q2 GDP was good, as consumption and business investment shone; inventories lagged but should pick up; July job growth topped estimates and wages showed stabilization.


Fixed Income Perspectives - Unwind First, Hike Later

By Matt Toms, CFA, CIO, Fixed Income

The Federal Reserve reaffirms its view that softer inflation data are temporary, and therefore the path of rate hikes remains unchanged for now. Accordingly, we maintain shorter duration across portfolios and are leaning toward assets which are expected to benefit from the latter stages of the credit cycle.


Fixed Income Perspectives - Fixed Income Themes Update

By Matt Toms, CFA, CIO, Fixed Income

Twice a year we refresh our decision framework. As the second half of 2017 gets underway, here's how we view fixed income investing.


Fixed Income Perspectives - The Eurozone Gets a Reprieve, for Now

With political risk to the European Union easing and the eurozone economy strengthening, the European Central Bank may taper its stimulus program and lead eurozone yields higher. The U.S. Federal Reserve will implement three rate hikes this year. We maintain short duration posture to U.S. and German rates.


Fixed Income Perspectives - Reading the FOMC Tea Leaves

Despite signs of economic softening the Federal Reserve still intends to normalize policy through interest rate hikes, ending reinvestment and reducing its portfolio. Though bond investors might expect increased market supply to result in higher yields, we believe that strong demand — and Treasury issuance coordinated with Fed policy — will mitigate a significant rate move.