Investment Grade Fixed Income Management
Barksdale Investment Management’s primary goal in managing fixed income portfolios is to achieve or exceed each client's investment objectives and service expectations. One distinguishing characteristic of the firm, and an important strategy in meeting this goal, involves the initial construction and on-going active management of customized portfolios. The portfolios are constructed and managed to comply with individual client guidelines, as opposed to using predetermined master portfolio methodologies, approved lists, or commingled funds. At Barksdale, portfolios are managed based on specific client directives in order to meet their particular requirements for liquidity, risk tolerance, credit quality and a host of other variables. In addition, at Barksdale the professional management team makes a special effort to know each client and understand their needs.
The principal objective in fixed income management at Barksdale is to preserve and enhance the purchasing power of the assets. This process is driven by the philosophy that the firm must protect the client's capital and make it grow at a rate that exceeds the rate of inflation as well as an applicable benchmark, while staying within the stated guidelines. The approach is a blend of top-down and sector/security-specific analysis which is thorough, active and balanced. Barksdale utilizes elements from fundamental, quantitative and technical analysis in order to maximize returns within a client-specified duration band while minimizing market, sector and credit risk. All portfolios are managed according to a disciplined investment strategy that employs three primary steps (Yield Enhancement, Valuation Analysis, and Maturity and Risk Management) to tactically position portfolios relative to the yield curve, and to over-weight selected market sectors such as high quality corporate bonds, mortgage backed securities, assets backed notes and, if client directed, to high yield debt.
Barksdale’s emphasis on risk control where credit and market risk are widely diffused in portfolio construction offer , in our opinion, a prime advantage. Incremental value is added through a variety of proprietary fixed income techniques, where no large bets are made in any single variable or discipline, instead utilizing a weight of the evidence approach where small, active divergences are implemented across a broad range of variables.
Barksdale utilizes a number of proprietary models to make decisions on sector allocation, yield curve positioning, and duration exposure. Approximately 75% of the research is generated internally. Barksdale begins with a top-down approach utilizing proprietary correlation models as well as economic, duration, and broad sector analysis. Barksdale overlays further quantitative analysis on sectors, credit and yield curve. Traditional, fundamental bottom-up credit research is incorporated throughout. Examples of the many proprietary predictive and analytical models that we have developed over the years include various bond valuation and rating models on corporate and mortgage sectors, yield curve reversion-to-the-mean models, and various models that forecast the yield curve, GDP, inflation, and future Fed funds rates. The majority of the 25% outside research supports our credit research.
Investment Grade Fixed Income Product Offering (click below to download fact sheet):