Objective
| Return: |
The Highstreet bond portfolios target a return that is similar to the DEX Universe Bond Index. |
| Risk: |
The bond portfolios will have a risk profile that is market-like or better. |
Investment Philosophy and Approach
Bond Philosophy
We follow a passive enhanced approach to the bond market.
1) DEX Universe-like term and duration
Our philosophy is founded on the belief that it is not possible to successfully anticipate the direction of interest rates. For this reason we manage bond portfolios to have the same duration and term as the DEX Universe Bond Index, ensuring that our strategy remains unbiased to expected interest rate movements.
2) Over-weight corporate issues
We add value by utilizing a disciplined credit risk process.
We believe that we can improve the returns in the portfolio by holding a higher weight in corporate and provincial bonds than the index. Our Canadian Bond Fund targets a mix of 50% corporate bonds, 35% provincial bonds and 15% Government of Canada bonds.
3) No BBB’s or lower
Our Fund is a high quality bond portfolio. We do not hold any bonds with a rating of BBB-rated or lower, based on our view that these issues present a higher level of risk than we wish to assume for our clients.
Investment Products
Highstreet has managed an indexed bond pooled fund since October 1998. The Highstreet Bond Fund is available to both private and institutional investors. This Fund expects to deliver performance that is similar to the DEX Universe Bond Index. The Fund assumes less risk than the DEX Universe by excluding BBB rated bonds.
As well, Highstreet offers segregated portfolio management for portfolios of $25 Million or more. Segregated portfolios can be managed to any index (eg: DEX Universe, all-government, term-specific). All bond portfolios are passively managed.
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