Our philosophy in managing core plus fixed income accounts is to add value by investing a portion of the portfolio outside of the Lehman Aggregate Bond Index, primarily (although not exclusively) in high yield and emerging markets within a narrow duration band to the index.

By taking advantage of a wider opportunity set of sectors which have historically achieved above-average returns, this approach enhances our traditional core fixed income strategy which utilizes U.S. Governments / Agencies, corporate bonds, MBS and ABS.

QUARTERLY UPDATE