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For income-oriented clients, we actively manage bond portfolios designed for total return providing stable income while protecting principal. History indicates that the utilization of a broadly diversified portfolio and intermediate-term maturities is an optimal combination. A client can expect to see a mixture of treasury, agency, and investment grade corporate bonds in a portfolio.
Our group of investment analysts does not attempt to forecast the general direction of interest rates. Instead, we analyze the current investment environment, yield curve, and risk/return relationships throughout the fixed-income market. Our fixed-income approach focuses on the total return of the portfolio. This strategy allows the team to construct fixed-income portfolios optimizing the relationship between sector allocation, yield curve changes, and maturity. Continual monitoring of changing spread movements among fixed income assets provides opportunities for additional yield and decreased risk.
Consistent with our firm's investment philosophy, our fixed-income managers believe that non-leveraged; intermediate-term; investment grade bond portfolios will maximize returns while minimizing risk. Spread analysis plays an important role in the weighting of our bond portfolios between sectors, maturities, and quality.
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