IO&C recently interviewed Payden & Rygel’s Eric Souder and discussed ways the fixed income manager protects its clients portfolios:

In a timely series of meetings with advisors and bigger investors in Australia last week, Payden & Rygel, the US-based global fixed income manager, provided an interesting overview of the difficulties being faced by investors looking for yield and downside protection.

Fresh from the previous week’s announcement of a major mandate win with Rest – a $500 million absolute returns fixed income strategy which focuses on downside protection – Payden & Rygel’s Eric Souders, a principal and portfolio manager, and Ali Giles, a principal and head of corporate research, posed the question: “where do we go from here?”

Payden & Rygel, represented in Australia by GSFM, has a strong background in short-duration securities, although it has tended to broaden its strategy options in recent years, according to Giles. The privately owned firm was started in 1987, itself a difficult year for markets given the stock market crash and soaring interest rates. It has about US$120 billion under management, about US$12 billion of which is in the absolute return fixed income strategy, targeting a spread of 2-3 per cent above cash. It also uses tactical overlays and beta hedges to assist downside risk control.

To read the article, click here.

Tracey Franks GSFM Adviser

The views expressed are her own and do not consider the circumstances of any investor.