Traditional Fixed Income Strategies

Intermediate Fixed Income

OBJECTIVE

To build and maintain a portfolio that represents the best relative value available based on the expected economic and market environment. We alter portfolio composition based on the liquidity constraints of the client. We look to add incremental return by taking advantage of market anomalies. Our goal is to outperform the Bloomberg Intermediate Govt/Credit Index and to rank in the upper quartile in a universe of our peers.

STRATEGY

We seek total rate of return through the active management of all structural components of the portfolio; sector/industry allocation, credit quality, liquidity, yield curve, maturity exposure and call structure. Our primary focus is issue selection and sector rotation. We attempt to buy credits or structure that should perform well in the current economic environment. We typically do not look to benefit from duration management.

OVERVIEW

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Intermediate Plus Fixed Income

OBJECTIVE

To build and maintain a portfolio that always represents the best relative value available in the expected economic and market environment. In addition, we look to add incremental return by taking advantage of market anomalies and opportunities. Our goal is to outperform the Bloomberg Govt/Credit Index and to rank in the upper quartile in a universe of our peers.

STRATEGY

We seek total rate of return through the active management of all structural components of the portfolio; sector/ industry allocation, credit quality, liquidity, yield curve, maturity exposure and call structure. Our primary focus is sector/industry allocation and issue selection. We excel at positioning the portfolio to prosper in the expected economic environment and in assessing credit risk in the context of relative value. Our Intermediate Plus product also incorporates a dynamic allocation to the high yield (credit, MBS and ABS) sector that provides incremental returns during periods of improving credit fundamentals.

OVERVIEW

• Total rate of return. We seek total rate of return through the active management of all structural components of the portfolio — sector and industry allocation, credit quality, liquidity, yield curve, maturity exposure and call structure.
• Primary focus. The primary focus of our intermediate plus fixed income strategy is sector and industry allocation, and issue selection.
• Performance & protection. We believe in positioning a portfolio to prosper in the expected economic environment while assessing credit risk in the context of relative value.
• Dynamic allocation to high yield. Our intermediate plus strategy also incorporates a dynamic allocation to the high yield (credit, MBS and ABS) sector that provides incremental returns during periods of improving credit fundamentals.

OVERVIEW

View the Intermediate Plus Fixed Income Profile

Core Fixed Income

OBJECTIVE

To build and maintain a portfolio that represents the best relative value available based on the expected economic and market environment. We alter portfolio composition based on the liquidity constraints of the client. We look to add incremental return by taking advantage of market anomalies. Our goal is to outperform the Bloomberg Aggregate Index and to rank in the upper quartile in a universe of our peers.

STRATEGY

We seek total rate of return through the active management of all structural components of the portfolio; sector/ industry allocation, credit quality, liquidity, yield curve, maturity exposure and call structure. Our primary focus is issue selection and sector rotation. We attempt to buy credits or structure that should perform well in the current economic environment. We typically do not look to benefit from duration management.

OVERVIEW

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Core Plus Fixed Income

OBJECTIVE

To build and maintain a portfolio that always represents the best relative value available in the expected economic and market environment. In addition, we look to add incremental return by taking advantage of market anomalies and opportunities. Our goal is to outperform the Bloomberg Aggregate Index and to rank in the upper quartile in a universe of our peers.

STRATEGY

We seek total rate of return through the active management of all structural components of the portfolio; sector/ industry allocation, credit quality, liquidity, yield curve, maturity exposure and call structure. Our primary focus is sector/industry allocation and issue selection. We excel at positioning the portfolio to prosper in the expected economic environment and in assessing credit risk in the context of relative value.

The “Plus” component of the NIS Core Plus strategy contain US domiciled non-investment grade bonds.  At least 70% of “Plus” is invested in non-investment grade corporate bonds.  Other allowed investments include higher yielding investment and non-investment grade asset-backed securities, mortgage-backed securities, municipal bonds and bank loans. The “plus” or high yield component of Core Plus Fixed Income has an allocation range of between 5-15% based on the economic background and below IG fundamentals.

OVERVIEW

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American Beacon NIS Core Plus Bond Fund

National Investment Services is a sub-advisor for the American Beacon NIS Core Plus Bond Fund.

American Beacon is a registered service mark of American Beacon Advisors, Inc. American Beacon Funds and the American Beacon NIS Core Plus Bond Fund are service marks of American Beacon Advisors, Inc.

To learn more about the Core Plus Mutual Fund, please visit American Beacon's website.

Socially Responsible Investing

OBJECTIVE

The objective of the NIS socially responsible investing strategy is to maximize yield and minimizing risk while adhering to USCCB (United States Conference of Catholic Bishops) socially responsible investing guidelines.

In addition, our socially responsible investing strategy looks to add incremental return by taking advantage of market anomalies and opportunities. Our goal is to outperform the Bloomberg Barclays Intermediate Government Credit Index and to rank in the upper quartile in a universe of our peers.

STRATEGY

We seek total rate of return through the active management of all structural components of the portfolio; sector/industry allocation, credit quality, liquidity, yield curve, maturity exposure and call structure. Our primary focus is issue selection and sector rotation. We attempt to buy credits or structure that should perform well in the current economic environment. We typically do not look to benefit from duration management.

OVERVIEW

View the Socially Responsible Investing Profile

Liability Driven Investing

OBJECTIVE

The objective of the NIS liability driven investing strategy is to build and maintain a portfolio that focuses on the projected liability outflows as its benchmark for the development of yield curve and interest rate strategies.

Our primary goal is to meet the benefit payment obligations of the plan on a timely basis and maintain or improve the funding status of the liability.

STRATEGY

• Interest rate risk. We seek to defease interest rate risk and look to other investment tools with more predictable alpha to build surplus.
• Structural components. As a result, we are actively involved in the management of the structural components of the portfolio — sector/industry allocation, credit quality, liquidity, yield curve exposure and call structure.
• Traditional yield sectors & Treasuries. In addition to U.S. Treasuries, we utilize traditional yield sectors of the market, such as agency and corporate bonds, preferred stocks, residential and commercial mortgage-backed securities, and asset-backed securities to take advantage of their higher yields and capital gain opportunities. U.S. Treasuries provide portfolio liquidity and an occasional safe harbor during credit storms.