Taxable Intermediate

People

James Bernard, CFA

Portfolio Manager

Jim Raimondo

Portfolio Manager

Jeremy Scacco

Portfolio Manager

Key Stats

Inception July 31, 2005
Benchmark Barclays US Intermediate Aggregate
Account Min. $2M
Custodial Arrangements Available upon request

Philosophy

The Ancora Taxable Intermediate Fixed Income Strategy has two goals: one, to secure our client’s capital at all times and two, to provide a real return (above the rate of inflation). We believe this can be accomplished over time in the intermediate portion of the yield curve, defined as 3-10 years to maturity. With almost universal access to investment research and bond analytics, it is not the availability of research but rather how it is utilized and consistently applied that achieves successful long term fixed income results. To that end, several aspects of our approach to fixed income investing stand out:

  • Intermediate Target: Over time, we believe the intermediate portion of the yield curve (3-10 years) outperforms on a risk adjusted basis with less price and income volatility.
  • Core Positions: To ensure proper diversification we construct a foundationally sound and diverse bond portfolio
  • Secondary Positions: While liquidity and marketability are desirable characteristics in a fixed income portfolio, opportunities often exist to add value in less actively traded issues and structures for a small segment of the portfolio.
  • Price Discovery: While bond market transparency has improved, we believe there is still a significant opportunity to add value through a rigorous price discovery discipline, particularly in smaller issues and more complicated bond structures. With over $1 billion in discretionary and non-discretionary fixed income advisory assets, we are large enough to “shop” our transactions across a wide variety of market makers for the best possible price.

These strategy differentiators, combined with our extensive credit and sector analytical background and our willingness to be very hands on when it comes to client service, make Ancora’s Taxable Intermediate Fixed Income Strategy the right choice for a wide variety of institutions, RIAs and consultants. 

Process

  • Portfolio Construction: Typically 20-50 holdings per account, focusing in on credit/duration/sector allocation decisions. The investment universe is high-quality, investment grade bonds.
  • Buy Discipline: We focus on investment grade bonds and buy when price has dislocated from fundamentals, relative to historical spreads.
  • Sell Discipline: We scale out of positions when price becomes stretched relative to historical spreads and when underlying credit fundamentals begin to deteriorate. Frequently, the price action of an issuer’s equity can be a solid leading indicator for the company’s bonds. 
  • Risk Management: We maintain rigorous credit standards for the portfolio with a quality-first attitude. Individual position sizes are limited to ensure proper diversification. In addition, duration bets are confined to no more than 20% variance with the duration of the target index.  

Performance

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To learn more, contact an Ancora advisor today >