Flexible bond portfolios are not tethered to benchmarks, and can adapt to changing conditions by seeking to manage interest rate and credit risk.
- Adapt to changing markets. Traditional bond investing strategies that worked in the past may not continue to do so in the future.
- Shed constraints. Many traditional bond strategies must follow rigid investment objectives, which forces them to remain closely tied to their interest rate-sensitive benchmarks, no matter what the environment.
- Seek a wider opportunity set. With the wide opportunity set available to flexible bond strategies, these funds can adapt to market and economic conditions by appropriately managing interest rate risk and credit risk.