DoubleLine Infrastructure Debt Strategy
Infrastructure debt is a unique component of the credit market that provides essential financing to strategic sectors of the economy. These sectors include, but are not limited to, airports, toll roads, bridges, power, and pipelines.
The infrastructure debt universe also provides excellent diversification benefits outside of traditional fixed income sectors while offering incremental yield and strong defensive attributes. As such, infrastructure investment is an important cornerstone of economic growth, particularly as urbanization and industrialization continue to expand in developing economies.
As infrastructure growth continues to expand, so does the need for financing. According to a recent study from McKinsey Global Institute, approximately $57 trillion of additional infrastructure funding will be needed by 2030.1 However, due to regulatory constraints and rigorous liquidity requirements placed on financial institutions including Basel III limitations, this financing will need to come from a different type of institution. DoubleLine believes this paradigm shift may present a compelling opportunity for investors.
The DoubleLine infrastructure team, which currently manages over $1 billion in infrastructure assets across several DoubleLine investment strategies, plans to take advantage of this growing segment of the market through the DoubleLine Global Infrastructure Debt Strategy. With over 17 years of experience, the team combines a unique skill set in structured products and emerging market research with expertise and knowledge of country and political risks. The strategy utilizes a time-tested five step process by combining bottom-up research with macroeconomic overlays to invest across the capital structure. While maintaining a focus on sectors that are strategic to an economy in order to limit downside risk, the strategy provides investors with income and an absolute return. Furthermore, because the team is already invested in the sector, they should continue to have access to strong sourcing deals and favorable structuring terms.
Source: World Economic Forum, "Infrastructure Investment Policy Blueprint", February 2014.
1. McKinsey Global Institute: "How to Save $1 Trillion a Year"
DoubleLine Flexible Income Strategy
The DoubleLine Flexible Income Strategy's ("the Strategy") investment objective seeks long term total return through current income and capital appreciation by actively allocating across fixed income sectors using duration management based on the portfolio manager's view of, among other things, future interest rates and market conditions.
Jeffrey Gundlach, lead portfolio manager with over 30 years of investment experience, has broad discretion to modify the Strategy's duration within a wide range, including the discretion to construct a portfolio of investments for the Strategy with a neutral or even negative duration. The goal is to provide better risk-adjusted returns over a variety of different market cycles and have less correlation to more traditional, intermediate-term bond strategies.
The Strategy uses a top down sector allocation approach by allowing the manager to over-or-underweight sectors based on DoubleLine's analysis of sector fundamentals and relative valuations. Once selected, specialized teams for each asset class incorporate a bottom-up security selection process based on their deep experience and research. The Strategy is not constrained by management against any index and allows DoubleLine broad flexibility to invest in a wide variety of fixed income instruments.
Source: DoubleLine Capital. Representative portfolio sector allocation is as of February 28, 2015 and is subject to change without notice.
DoubleLine Video & Articles
Jeffrey Gundlach - DoubleLine Overview
Fixed Income Asset Allocation
Global Developed Credit - Floating Rate
Low Duration Emerging Markets
Mortgage-Backed Securities - Total Return
Shiller Enhanced CAPE®
Articles & Video about DoubleLine
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1-27-15 CNBC Jeffrey Gundlach discusses the markets Click here to view video
8-15-14 CNBC "DoubleLine's Gundlach: Could see U.S. 10-year yields go to 2.2%"
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02-12-14 "Gundlach: QE will not end in 2014"
02-12-14 "Gundlach: Market has discounted tapering" http://video.cnbc.com/gallery/?video=3000245506
4-9-14 The Street "Bank Loans vs. High Yield"
04-14-14 "Housing Finance Reform"
Information presented was current as of the date the material was prepared by an outside party. DoubleLine assumes no duty to update this information.
Thursday, September 11, 2014 at 1:15 pm PT / 4:15 pm ET
"Opportunistic CMBS/CRE Strategy Launch"
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