The article further elaborates on the strategies of various fund managers. Phil Jacoby of Spectrum Asset Management emphasizes maintaining core positions in junior subordinated debt, while Alfred Murata of Pimco highlights the attractiveness of high-quality assets with wider spreads. Other managers, like Andrew Hofer of Brown Brothers Harriman and Marc Bushallow of Manning & Napier Advisors, focus on identifying undervalued bonds with durable value and avoiding lower-rated market segments. The article also notes the cautious approach towards sectors potentially disrupted by AI, with a focus on investments offering fixed-income-like downside protection and equity-like upside potential.
Key takeaways:
- Top-performing US blue-chip bond funds in 2024 focused on riskier debt from companies resilient to economic turbulence and avoided interest-rate sensitive corporations.
- Principal Asset Management and Pacific Investment Management Co. see opportunities in riskier debt from higher-rated companies, especially those benefiting from AI advancements.
- PIMCO Low Duration Income Fund finds attractive opportunities in US government bonds and agency mortgage-backed securities due to widened spreads.
- Fund managers emphasize the importance of disciplined investment strategies, focusing on sectors like health care, telecom, and AI-related industries.