Strategy & Tactics

Our Investment Strategy adds value by producing superior returns and cash flows

  • Incremental yield – the creation of an enduring yield advantage versus the benchmark
  • Sector judgments and specific security selection / avoidance
  • Maintaining a duration near benchmark
  • Diversification across yield curve and among holdings
  • Enhanced cash flow providing superior reinvestment opportunity over the long term

Sector Selection: Overweight corporate bonds and mortgages

Mortgage and corporate bonds have outperformed treasuries in 22 of the past 29 years

Investment Process: Top Down Theme Identification

  • Our process is centered around macro theme identification which involves studying the global landscape for trends that will impact investment decisions.
  • Discussion of supply and demand fundamentals
  • Consideration of relative attractiveness of spreads among sectors
  • We are not beholden to benchmark sector weightings
  • With diverse backgrounds and experiences, each portfolio manager brings a different perspective of the investment world to the table.
  • Years of observations and macro environment study has been central to our long term success and sets Orleans Capital apart from its competition.

Investment Process: Bottom Up Security Selection

  • The portfolio management team uses an equity-like approach in evaluating securities for buy list and sell candidates
  • Potential buy names are researched and analyzed using several methods
    • Street research, third party independent research, internal research discussed collectively
  • No emphasis on rating agencies in determining value
  • Early sellers of “red-flag” credit names, avoidance of credit risk is crucial

Fixed Income & Economic Macro

  • Macroeconomic Inputs
  • Capital Expenditures
  • Economic Growth
  • Monetary Policies
  • Sector Fundamentals
Identify the best sectors given our macro views
Select best-in-class bonds for chosen investment themes
  • Company Financial Models
  • Stock Price Movements
  • Relative Value Modeling
  • Spread Movement

Security Selection: Equity Like Approach