By attracting top talent, supporting continuous learning, and encouraging a free exchange of all ideas, AIMCo can offer its clients high quality internal investment expertise at a fraction of the cost of external management.
AIMCo’s Fixed Income Group is one of the most experienced in the industry with years of combined experience and collaboration.
AIMCo’s Fixed Income Group has consistently delivered strong results. In 2013, it added value by correctly positioning the portfolio for higher interest rates, reducing duration and emphasizing high quality credit.
The Fixed Income team remains focused on continuous innovation in its strategy and products. AIMCo’s “no-silos” approach encourages the sharing of ideas across teams, joint review of opportunities, and participation in the development of new market products. Being successful in fixed income sometimes means rowing against the tide. Being early does not always pay off immediately, but the return on implementing a well thought out strategy with conviction can be significant.
Effectively innovating a traditional asset class like Fixed Income requires expertise and the experience to know how to effectively deploy new strategies and products.
The Fixed Income team completed another successful year in 2013 with roughly $518 million in net value added, or 167 basis points over benchmarks.
Associate Portfolio Manager,
Senior Vice President,
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Sector and security selection continue to be key drivers of positive relative performance
How does AIMCo’s Fixed Income group deliver on its mandate?
The Fixed Income group manages a portfolio of more than $25 billion on behalf of AIMCo’s clients. Size provides significant economy of scale, but more important is how we leverage that scale to create value. Our team has established a good reputation in the market so that when an opportunity presents itself we can act quickly and decisively.
Describe the Fixed Income Team.
We are fortunate to have a team of highly experienced investment professionals that have also spent a significant portion of their professional careers working alongside one another. There is a high level of trust within the group that is evident when we evaluate new strategies or discuss market trends.
Interest Rates are at historic lows – how is the team managing in this environment?
Our Fixed Income team has adopted a patient, cautious approach to interest rate calls over the last couple of years. We formed a high conviction view in mid-2012 that interest rates had finally bottomed and subsequently switched our strategy to incorporate a short duration bias across our portfolios. Our market timing was very good and this position contributed to our clients’ out-performance when interest rates increased by almost 1.2%.
How did AIMCo’s Corporate Credit strategy perform in 2013?
Corporate bonds performed well throughout 2013 and AIMCo’s fixed income portfolios benefited from an overweight in high quality, short maturity corporate bonds. We have a core group of experienced credit analysts that help us identify pockets of value in the credit markets. Fortunately our timing was good and we were able to position the portfolios with securities that outperformed the broader market. We also sold positions in sectors of the credit market that appeared expensive. Sector and security selection continue to be key drivers of positive relative performance.