In an environment of stubbornly low interest rates, investors find it difficult to reconcile generating returns with exposure to interest rate risk. Benchmark bond indices are not enough.
In the next webcast, Need better bonds? The arguments in favor of active management, Kenneth Herold, Senior Vice-President and Director of the Investment Strategies Group, Natixis Investment Managers; and Christopher T. Harms, Vice President and Portfolio Manager, Loomis, Sayles & Company, will discuss the benefits of actively managed fixed income strategies given the current interest rate outlook.
In order to better manage potential market risks in the future, investors may turn to actively implemented quantitative strategies that attempt to provide better exposure to changing market conditions. For example, Natixis Investment Managers offers ETF Natixis Loomis Sayles Short Duration Income (NYSEArca: LSST).
The Natixis Loomis Sayles Short Duration Income ETF is backed by the Loomis Sayles global research platform, which combines top-down macro analysis and bottom-up stock selection. LSST offers a dynamic and active approach to sector allocation and security selection by a highly experienced portfolio management team, supported by the depth and breadth of Loomis Sayles’ credit research and securitization. The ETF will seek to obtain current income consistent with preservation of capital by investing in fixed income securities such as bonds, notes and debentures, as well as other investments, with an average duration of between one and three years.
When deciding which securities to buy and sell, Loomis Sayles will take into consideration a number of factors related to bond issuance and the current bond market, including the stability and volatility of a country’s bond markets, the financial strength of the issuer, current interest rates, current valuations and Loomis Sayles’ expectations for general interest rate trends. Active ETF managers will also consider the impact of buying or selling a bond on the risk profile and potential return of the portfolio.
Financial advisers who want to learn more about active bond strategies can sign up for the Tuesday May 18 webcast here.