Investment Overview

Our team-based approach integrates our relative value philosophy, risk budgeting framework and fundamental security analysis.
Target excess return: 50-100 basis points.
Target tracking error range: 100-200 bps.
The team includes 25 professionals involved in portfolio management, fundamental research, quantitative analysis, risk management and trading.
We seek to gain from the credit-risk premium while emphasizing loss avoidance.
Our process combines top-down macro assessment with bottom-up fundamental analysis, targeting active risks to sector allocations, security selection and interest rate management.
We believe in using convexity as a tool to limit risk and protect on the downside, but participate on the upside.
The strategy has historically generated competitive relative risk-adjusted performance as well as low excess return correlation with most other core managers.*

*Source: eVestment Alliance.

Portfolio Construction

Constantly aware of potential upside/downside capture positioning relative to benchmark.
Diversified portfolio of 100 to 140 issues.
Credit quality of BBB- or better with average AA+ rating.
Duration target: +/-20% vs. index.
Historical tracking error range of 50 to 150 basis points of active risk.

Investment Team

Thomas H. Luster, CFA
Co-Director of Diversified Fixed Income
26 years of industry experience
21 years at Eaton Vance
BS, George Washington University
MBA, University of Chicago
Bernard Scozzafava, CFA
Co-Director of Diversified Fixed Income
32 years of industry experience
10 years at Eaton Vance
BA, Hamilton College
MS, Massachusetts Institute of Technology

Benchmark

Bloomberg Barclays U.S. Aggregate Bond Index