Fixed Income Strategy
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Macro is the key factor
for investment decisions
Investments in bonds
and ETFs in US market
Active management of duration
along the curve to hit target returns
Objectives and strategy
Objectives
The strategy aims to generate the highest possible yields on bonds in the global markets using ETFs on bonds and other assets that also track macroeconomic conditions and trends.
Target return of 7-10% per annum in US dollars over a long time horizon.
Strategy
Investment strategy
The strategy seeks to capture absolute income in debt markets — interest income and gains in asset value. Investments are made in bonds with different maturities with the use of ETFs, which enhance the yield of the debt portfolio and hedge against potential changes in the macroeconomic backdrop and global central bank policy.
This product is suitable for
Target investor
Investors who are familiar with the debt market and believe, like our team does, that bonds can provide acceptable returns without increasing risk.
ContactObjectives
The strategy aims to generate the highest possible yields on bonds in the global markets using ETFs on bonds and other assets that also track macroeconomic conditions and trends.
Target return of 7-10% per annum in US dollars over a long time horizon.
Strategy facts
Investment terms
Advantages
Strategy advantages
Why it's profitable
Structure advantages
Risks
Risk Management
Description A sharp move in the exchange rate of currencies in which investments are made.
Risk management method The portfolio is denominated in US dollars and all investments are made in dollar assets in the US market.
Description A sharp change in interest rates because of central bank actions, accelerating inflation and/or depreciation of the national currency.
Risk management method We control not only the duration of the portfolio, but also the weight of each individual asset and its duration. Possible risks are monitored every day using publicly available macroeconomic statistics, which can indicate possible actions by the Fed regarding its monetary policy and shed light on the economic outlook, possible changes in fiscal policy and Treasury operations in the market.
Description An asset is unable to be sold quickly and at a price without incurring losses.
Risk management method The portfolio includes only highly liquid assets that are traded in the most capital-rich and liquid market.
Description A borrower fails to fulfill its obligations to creditors (default risk).
Risk management method The portfolio is formed exclusively from high-quality assets (government debt or bonds of corporate issuers with a high credit rating of above BBB). Moving forward, investments in bonds of issuers from other DMs or EMs are possible, but they will be made only after the issuers have proven their robustness and creditworthiness during a period of a strong dollar and high rates. To ensure this, a comprehensive credit analysis will be carried out.
Description A company that has entered into an agreement with you (bank, broker) cannot fulfill its obligations on time and in the due amount.
Risk management method We are constantly working to improve the agility of our infrastructure to reduce counterparty risk, increase the efficiency of our operations and reduce fee expenses. We monitor the news flow regarding our counterparties, periodically audit their credit reports and investigate other risks associated with them (reputational, licensing, political, etc.).
Description High concentration of a single asset; dependence on one counterparty, economic sector or country.
Risk management method The procedures developed over the years involve restrictions on the position limit for each issuer depending on its credit rating and liquidity in the secondary market. Decisions on adding an asset to the portfolio are made by the Investment Committee, and can be accompanied by additional conditions, such as an investment implementation period and stop-loss and take-profit levels. Even when approved by the Committee, a position is not opened for the full limit at once: the high volatility of the markets means the position will be built up gradually, giving time to confirm a hypothesis.
Description Improper or flawed internal processes, employee actions, systems or external events.
Risk management method We are constantly working to improve the agility of our infrastructure to reduce counterparty risk, increase the efficiency of our operations and reduce fee expenses. In addition, we are always fine-tuning our own procedures, looking for weaknesses and making the interaction of employees within the company as efficient as possible.
- One of the recognized Russian experts with more than 30 years of experience in the financial markets.
- Since 1993, within the Central Bank of Russia Alexander participated in the creation and development of the Russian sovereign debt market. Then he headed the debt market analysis team of Troika Dialog.
- Since 2000, he headed the analytical, and trade divisions, was engaged in asset management in the largest Russian and international banks.
- In 2008 he rejoined Troika Dialog (after 2012 known as Sberbank-CIB). As a Vice-President, he led a project to modernize the Russian debt market.
- He has a degree of the Financial Academy in international economic relations, a diploma from the Moscow Aviation Institute, diplomas from FRB NY and Carnegie Mellon University.
- Contributes to building the ARGO investment portfolio. Specialises in credit analysis of companies, researching third party products and developing investment decisions.
- Worked in financial compliance for companies in the FMCG industry and as a business valuation consultant in the corporate finance department of Deloitte.
- Graduated from the Higher School of Economics, Department of Economic Sciences.
- Specialist in financial consulting and audit with 10 years of experience.
- In the past, she worked as an external auditor at Ernst & Young, worked with the largest state-owned companies, small and medium-sized businesses and government agencies in the field of audit and professional ACCA training; areas of specialisations: oil and gas industries, energy, and mining. As a financial advisor to medium-sized companies, provided regular reporting to management and shareholders.
- Is a member of ACCA, a CFA II candidate and a certified specialist in AML.
- Graduated from the University of Sydney with a bachelor's degree in economics and finance.
