Products
Investment capabilities
Education
The case for fixed income has changed
After the era of low rates and an inverted yield curve shaped investors’ approach to fixed income, a normalizing rate environment is renewing the potential value of bonds. Not just for a foundation of portfolio stability and the possibility of returns above cash, but for increasingly attractive sources of income, diversification, and total return potential.
Higher yield potential, wider dispersion, and more relative value opportunities have changed the fixed-income equation, particularly for active fixed-income strategies.
BRIAN HESS: So, Jack, given what you were saying about the hyperscalers and their aggressive CapEx spending, that seems to be resulting in a high degree of fixed income issuance. Does that play into active fixed income managers in the current environment?
JACK JANASIEWICZ: Sure. And I think that's very important because as we continue to see this CapEx spend, because of the AI build out that nobody wants to lose that race, you need to fund that CapEx spend. And we're seeing it coming from both equity issuance, as well as bond issuance. And bond issuance, especially on the investment grade side, just from the hyperscalers is almost doubled from them. And so when you think about the index constituencies and the weights that are going to be in there, you're just going to get a bigger weighting towards tech in these hyperscalers going forward. And so now, you're talking about not just concentration risk equity markets. That's starting to spill over into the bond markets. And so this could be good, could be bad. I think you need someone who's actively looking at this saying, yeah, this is an opportunity here or it's a risk in managing around that.
BRIAN HESS: Yeah, given that we're late cycle and credit spreads are so compressed, we're not doing a whole lot with fixed income ETFs because we can't get granular down to the individual bond level or issuer level. As we start to potentially enter into that second half slowdown you highlighted, there could be some differentiation, some winners and losers where being able to pick which sectors or industries you're in, or which individual names you're in could have a big benefit, as opposed to just buying the high-yield market or the whole IG market the way we would have to do with an ETF and not getting compensated very much through that average credit spread, that's quite tight.
JACK JANASIEWICZ: Yeah, and the other thing to think about too, along the same lines, there's going to be a duration component. The curve is going to move. And to be able to take advantage of maybe some potential opportunities where you think the curve is a little bit mispriced, especially on maybe the rate outlook, you can take advantage of that as well through active management. So to your point, there's a lot of opportunity in the fixed income market. And I think it makes even more sense these days to look at active management on that front.
Download the brochure
Fixed income is not a single allocation. Different investors turn to bonds for different objectives, from generating income and preserving capital to diversifying equity risk or accessing specialized sources of return. Natixis Investment Managers offers a range of approaches designed to align with distinct portfolio roles.
We offer a range of investment vehicles including mutual funds, separately managed accounts (SMAs), model portfolios, and Custom Income Strategies.
Custom Income Strategies from Loomis Sayles
Tailored portfolios for high-net-worth investors
View all products: Mutual Funds • Exchange-traded Funds • Separately managed accounts
Schedule an objective portfolio evaluation with our Portfolio Analysis and Consulting Group. Our sophisticated
diagnostic tools can help identify diversification and yield opportunities, and stress test your portfolio.
Significant differences exist between Mutual Funds and Managed Accounts. Mutual Funds are pooled investment products whereby investors own shares in a portfolio, rather than shares of individual securities held by the fund. Mutual Fund fees are structured as a total expense ratio, and the portfolio cannot be customized per individual client request. Managed Accounts are customizable portfolios where investors directly own shares in the underlying portfolio holdings. Managed Accounts typically have eligibility requirements with negotiable investment management fees. Loomis, Sayles & Co., L.P. (“Loomis Sayles”) acts as a discretionary investment manager or nondiscretionary model provider in a variety of separately managed account or wrap fee programs (each, an “SMA Program”) sponsored by a third-party investment adviser, broker dealer, or other financial services firm (a “Sponsor”). When acting as a discretionary investment manager, Loomis Sayles is responsible for implementing trades in SMA Program accounts. When acting as a nondiscretionary model provider, Loomis Sayles’ responsibility is limited to providing nondiscretionary investment recommendations (in the form of a model portfolio) to the SMA Program Sponsor or overlay manager, and the Sponsor or overlay manager may utilize such recommendations in connection with its management of its clients’ SMA Program accounts. In such “model-based” SMA Programs (“Model-Based Programs”), it is the Sponsor or overlay manager, and not Loomis Sayles, which serves as the investment manager to, and has trade implementation responsibility for, the Model-Based Program accounts, and may customize each client account according to the reasonable restrictions or customizations that a client may request. Managed Account Strategies are offered by Loomis, Sayles & Company, L.P. (“Loomis Sayles”) is an independent advisory firm registered under the Investment Advisors Act of 1940. For additional information on this and other Loomis Sayles strategies, please visit our website at www.loomissayles.com.
Before investing, consider the fund’s investment objectives, risks, charges, and expenses. For all funds with Class A, C, and Y shares, please visit im.natixis.com or call 800-225-5478 for a prospectus or a summary prospectus containing this and other information; for funds with Institutional shares, please visit loomissayles.com, or call 800-633-3330. Read the prospectuses carefully.
Natixis Distribution LLC is a limited purpose broker-dealer and the distributor of various registered investment companies for which advisory services are provided by affiliates of Natixis Investment Managers. Natixis Distribution LLC is located at 888 Boylston Street, Suite 800, Boston, MA 02199-8197. • 800-225-5478 • im.natixis.com • Member FINRA | SIPC • Natixis Distribution, LLC (fund distributor, member FINRA | SIPC) and Loomis, Sayles & Company, L.P. are affiliated.
Natixis Advisors, LLC provides discretionary advisory services through its divisions Active Index Advisors®, Managed Portfolio Advisors®, and Natixis Investment Managers Solutions–US. Discretionary advisory services are generally provided with the assistance of model portfolio providers, some of which are affiliates of Natixis Investment Managers, LLC. Natixis Advisors, LLC does not provide tax or legal advice. Please consult with a tax or legal professional prior to making any investment decision.
ALPS Distributors, Inc. is the distributor for the Natixis Loomis Sayles Dynamic Core Plus ETF (LSCP) and Natixis Loomis Sayles Total Return Bond ETF (LSTB). Natixis Distribution, LLC is a marketing agent. ALPS Distributors, Inc. is not affiliated with Natixis Distribution LLC.