Government Strategy

An optimized, value oriented perspective.

The Government Plus Strategy is a value-oriented strategy that seeks a high level of current income consistent with safety of principal by investing in U.S. Government and Treasury securities. The team believes that markets can be inefficient and by performing rigorous analysis the team can position portfolios appropriately to add value over time. Bond prices reflect market forecasts for a variety of factors, such as economic growth, inflation, monetary policy, credit risk, and prepayment risk; yet markets tend to be poor forecasters of future events, especially when the implied market forecasts are out of line relative to historic trends. The team seeks to identify these mispricing’s and position client portfolios to exploit the value inherent in these opportunities.

High Credit Quality

Although agency bonds are not guaranteed by the full faith and credit of the U.S. government, they do involve some level of federal sponsorship and generally have high credit quality.

Liquidity

Agency bonds enjoy an active secondary market, so not only is there typically a large market to purchase, there is usually opportunity to sell before the bonds mature, if needed.

Yield over Treasuries

Agency bonds give individuals and institutions the opportunity to gain a higher return than Treasury bonds, while sacrificing very little in terms of risk or liquidity.

Passive vs. Active Management

IBNAM offers this strategy in only an active management style.

Passive strategies are initially setup and portfolio makeup will remain relatively unchanged unless directed by the client for the duration of the contract. This management style is typically better suited for accounts that require less oversight and see less activity. Active management is just that, account managers will actively monitor the account for potential improvements and will act on those opportunities to increase portfolio return, provide additional degrees of safety, and mitigate potential risks. Fees are typically higher than passive strategies, but come with a great deal of benefits. Due to the nature of this strategy, only an active management style is offered.