The Market Duration strategy is benchmarked to the Bloomberg Government-Credit Bond Index and primarily invests in Treasuries, Agencies and Investment Grade Corporate Bonds. Corporate positions are limited to 3% of the portfolio at purchase. The portfolio duration will typically range from 4-7 years. PIA offers three versions of the Market Duration strategy, which are listed below. For information on what style is available in your platform, please CONTACT US.
The Market Duration MACS strategy primarily invests in Treasuries, Agencies and Investment Grade Corporate securities but will opportunistically invest in Mortgage-Backed Securities (MBS), when the sector offers attractive risk-adjusted yield. The strategy will employ individual issues and may also utilize PIA completion funds for exposure to both BBB credit and MBS.
The Market Duration SMA strategy primarily invests in Treasuries, Agencies and Investment Grade Corporate securities and will employ individual issues. This version of the strategy is ideal for offshore clients.
The Market Duration MACS strategy primarily invests in Treasuries, Agencies and Investment Grade Corporate securities but will opportunistically invest in Mortgage-Backed Securities (MBS), when the sector offers attractive risk-adjusted yield. The strategy will employ individual issues and may also utilize PIA completion funds for exposure to both BBB credit and MBS.
We know that yield curves for various sectors within the bond market are periodically torqued by cyclical, monetary or market pressures, which can lead to inefficient pricing and create opportunities to produce excess returns. We intend to exploit these periodic opportunities by risk-adjusting various bond market sectors, utilizing yield curve and sector analysis, and combining that with fundamental research to produce a portfolio that provides attractive yield while emphasizing risk measurement at both a sector and security level. We seek to capitalize on these opportunities to earn above-average risk- adjusted yields, while creating the potential for capital gains as these sectors revert toward their fair value.
PIA’s core investment process balances the quantitative nature of our yield curve analysis with fundamental research to produce a portfolio that emphasizes sector selection, yield curve positioning, duration management and security selection in an attempt to produce above average risk-adjusted yields in undervalued sectors, while providing an opportunity for capital appreciation.