Fixed Income Portfolio Construction


Background

The recent good performance of Fixed Income Markets combined with the poor performance in general of Equity markets has resulted in substantially increased interest in Fixed Income Portfolios.

This one-day course provides a guide to Fixed Income Portfolio Construction for those with no previous experience.  It does assume a good basic knowledge of fixed income investments.


Delegates

  • Trainee Fund Managers
  • Brokers
  • Private Bankers
  • Institutional Salespeople
  • Experienced Fund Managers switching to Fixed Income


Content

Overview and Definition of the Fund Parameters

-Benchmark Selection and the Varieties Available
-Target Return Relative to the Benchmark
-Investment Horizon
-Permitted Investment Range by Type of Product
-Selection Universe


Investment Process

Determine the Key Drivers of the Bond Markets over the Investment Horizon
Example as to How the Market View is translated into Bond Yield Forecasts concerning:

  • Yield Curves
  • Regional Variations
  • Investment Horizons

Compare Investment View to Market Expectations
Alpha Generation: What to do to generate Fund Manager Value:

  • Duration
  • Market Selection
  • Yield Curve Slope and Convexity. What Parts will generate the most Return

Asset Allocation re, for example:

  • Credit
  • Emerging Markets
  • High Yield

Currency Hedging and Overlay Considerations

  • Tools available: Forwards, Futures, Options, Loans
  • Swaps
  • Risks, Costs and Time Horizon of Each

Minimise Risk or Take on Additional Active Risk?


Portfolio Construction

Build up a Portfolio to Implement the Views Adopted
Determine:

  • Active Interest Rate Exposure (Duration) by Country
  • And at a Total Portfolio Level
  • Active Yield Curve Risk by Country
  • Allocation to Non Government Bonds
  • Currency Exposure
  • Security Selection Considerations


Managing Risk

Sources of Risk
Measuring and monitoring Risk: Tracking Error and Value at Risk (VaR)

 




Todays Date:


Duration 1 day
Available as an in-house course







Investment Education PLC
45 Old Hall Road, Manchester M7 4JF, United Kingdom
Tel:+44 (0)161 832 3800
Email: mail@investmentEducation.net
Registered in England Number 2129160
VAT Registered Number GB 480 2112 85



site designed by:WEBSCIENCES