The Take
on what the market gives us…
The Cathedral and The Skyscraper
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September 30, 2020
In today’s uncertain environment, true bottom-up bond picking combines old-fashioned fixed income acumen with modern quantitative analysis. The result is a robust set of building materials that can be employed by an active manager to construct dynamic, flexible, and fundamentally sound portfolios. Read More
The Upside of Low Rates
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September 23, 2020
In this post, we explore some of the potential de-risking and cost-saving benefits of a borrow-to-fund strategy for corporate pensions in today’s low rate environment. Read More
I'm Sad Because I'm Shortening, and I'm Shortening Because I'm Sad
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September 16, 2020
Diverging durations have unique portfolio ramifications. Here we discuss the potential for passive additions to risk when durations move in opposite directions. Read More
Agency Mortgage-Backed Securities’ Excellent Adventure
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September 9, 2020
Long-term fixed income investors have experienced a variety of “black swans” over the past 20 years. Agency MBS has had its share of challenges, but the sector’s liquidity, transparency, and diversification benefits remain resilient through market cycles. Read More
Mental Model Update
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September 2, 2020
Low rates = long durations. Updating the mental model. Read More
The Election Matters…Just Not Very Much for Munis
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August 26, 2020
Munis exist at the crossroads of finance and politics, but this time the election might have minimal impact on the performance of the asset class compared with the past. Read More
Tarantulas in the Dark
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August 19, 2020
Have investors forgotten the trauma of March so quickly? Here is a summertime thought exercise on the impact of fear in markets and its considerations in active fixed income management. Read More
250* Fahrenheit, 6 Hours.
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August 5, 2020
As interest rates have declined, so too has the margin for error, thus increasing the benefits of portfolio diversification. Read More
How Much Will It Hertz?
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July 29, 2020
The Hertz Global Holdings bankruptcy in May has wide-ranging implications for Rental Fleet ABS. While a six-month compromise between creditors and Hertz was reached this week, the recent challenge by Hertz’s lawyers regarding the sanctity of the master trust lease agreement raises serious questions – most notably, how other ABS master trust indentures may be affected. As a result, we continue to watch these legal proceedings with interest. Read More
Game Changer
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July 22, 2020
Capital markets are forever changing. Credit spread compensation was once fairly straightforward to analyze, compare, and digest. That is no longer so. Read More