According to the announcement, to provide clients with a higher level of diversification, the two managed account strategies combine individual securities with shares of no-fee mutual funds advised by Western Asset Management and its affiliates. The strategies were previously only available to institutional investors.
By combining individual securities with no-fee mutual funds, the Core and Core Plus portfolios will allow Western to offer investors exposure to corporate and mortgage bonds as well as fixed income sectors not typically accessible in traditional separately managed accounts, such as high yield, emerging market debt and non-dollar denominated securities, the announcement said. Retail investors can access the products with a minimum investment of $250,000.
There are three no-fee funds designed for the new product offering – one invests mainly in mortgage-related securities, one focused on the investment grade corporate sector, and one invests in the emerging market debt, high yield and non-U.S. dollar fixed income sectors. The core style portfolio uses the first two no-fee funds in combination with individual securities, and the core plus style uses all three no-fee funds in combination with individual securities.
Western Asset will seek to maintain a minimum of 50% of each portfolio in individual securities typically comprised of individual bonds – mainly Treasury, Agency and investment grade corporate bonds, according to the announcement.
More information is at www.leggmason.com.