In a rising interest rate environment, many investors struggle to properly balance their fixed income portfolios to provide real diversification while still maintaining income generation.
In the upcoming webcast, Why Corporate Credit and Mortgage-Backed Securities Can Prosper in Rising Rate Environments, Pranay Sonalkar, portfolio manager at U.S. Core and Core Plus Fixed Income, Manulife Investment Management, and Peter M. Farley, senior portfolio manager at Securitized Assets, Manulife Investment Management, will outline fixed income strategies, like corporate credit and mortgage-backed securities, that can help financial advisors better adapt to rapidly changing market conditions.
For example, the John Hancock Corporate Bond ETF (JHCB) was the first fixed income ETF advised by the firm and is sub-advised by Manulife Investment Management (US) LLC, John Hancock Investment’s affiliated asset manager.
The John Hancock Corporate Bond ETF is actively managed and seeks a high current income level consistent with prudent investment risk. Under normal market conditions, it invests at least 80% of its net assets (plus any borrowings for investment purposes) in corporate bonds.
Additionally, the John Hancock Mortgage-Backed Securities ETF (JHMB), which is sub-advised by Manulife Investment Management (US) LLC, a John Hancock Investment Management’s affiliated asset manager, can help fixed income investors access the mortgage-backed securities space.
The John Hancock Mortgage-Backed Securities ETF is actively managed and seeks a high level of current income while seeking to outperform the benchmark over a market cycle. Under normal market conditions, the fund invests at least 80% of its net assets (plus any borrowings for investment purposes) in mortgage-backed securities. The fund may invest in mortgage-related securities issued or guaranteed by U.S. governmental entities and privately issued mortgage-related securities. These may include residential mortgage-backed securities, commercial mortgage-backed securities, and to-be-announced mortgage contracts, and may be rated investment-grade or below.
MBS and securitized assets are fixed income securities backed by various cash flow-producing assets. Issuers of securitized products pool these assets together and sell debt to investors that are collateralized by the pool of loans. Investors are entitled to the principal and interest payments generated from those assets. MBS is a type of securitized asset and is backed by residential and commercial mortgages. Agency MBS is the most well-known securitized asset issued by Fannie Mae, Freddie Mac, and Ginnie Mae.
Financial advisors who are interested in learning more about these fixed-income strategies can register for the Thursday, August 18 webcast here.