STRATEGIES

Short Duration

Philosophy

BlackRock’s Short Duration strategies employ a fundamental, diversified, relative-value approach focused solely on the front end of the yield curve. The team seeks to strategically allocate among three alpha sources: macro strategies, sector allocation and security selection.

The team views credit at the front end of the curve as having some unique attributes. The ability of a company (or securitized structure) to retire near-term debt with profits and/or balance sheet liquidity forms a critical aspect of the security selection process, with the ability to take a shorterterm view on a credit creating what may be thought of as time-horizon opportunities. With a flexible investment approach, the Short Duration team seeks to:

  • Uncover the most attractive current market opportunities at the short end of the curve across the fixed income spectrum.
  • Generate incremental yield by moving out on the curve and diversifying across spread sectors.
  • Offer various strategies with differing objectives, ranging from capital preservation and liquidity to a focus on yield generation and total return.

Investors with the following objectives may find an allocation to a Short Duration strategy worth considering:

  • Seeking to earn incremental yield on large cash positions.
  • Seeking to diversify a core fixed income portfolio tethered to the Barclays US Aggregate Bond Index.

Leadership

Thomas Musmanno, CFA
Head of Short Duration