On June 27, 2017, Portfolio Manager Philip Barach and Director of Corporate Research Philip Kenney held a webcast discussing the DoubleLine Low Duration Bond Fund (DBLSX/DLSNX) and the DoubleLine Floating Rate Fund (DBFRX/DLFRX) titled “DoubleLine Fund Offerings for a Rising Rate Environment.”
This recap is not intended to represent a complete transcript of the webcast. It is not intended as solicitation to buy or sell securities. If you are interested in hearing more of the portfolio managers’ views, please listen to the full version of this webcast on www.doublelinefunds.com under the blue “Events” tab. You can use the “Jump To” feature to navigate to each slide.
Michael Mauboussin: Here’s what active managers can do
DoubleLine Low Duration Bond Fund (DBLSX)
- Investment Philosophy: Active asset allocation of the Fund’s investments strives to mitigate risk and achieve better risk-adjusted returns while maintaining an overall portfolio duration of three years or less.
- The Portfolio is benchmarked to the BofA Merrill Lynch 1-3 year U.S. Treasury Index.
- Invests in shorter-duration assets in the following fixed income sectors (As of 5/31/2017):
- U.S. Government, 10%
- Mortgage-Backed Securities (MBS), 13.8%
- 0.7% Agency
- 13.1% Non-Agency
- Commercial MBS, 14.3%
- Bank Loans, 0%
- Investment Grade Corporate Credit, 10.9%
- Emerging Market Fixed Income (EMFI), 17.7%
- All EMFI holdings are U.S. Dollar-denominated
- Collateralized Loan Obligations, 13.7%
- Asset-Backed Securities, 9.0%
- Cash, 5.5%
- Credit Breakdown (As of 5/31/2017) :
- Government, 10%
- Agency MBS, 1.0%
- Investment Grade, 65.1%
- Below Investment Grade, 10.3%
- Unrated Securities, 8%
- Cash, 5.5%
DoubleLine Floating Rate Bond Fund (DBFRX)
- Riskier, overleveraged commodity-linked credits historically have not provided enough yield to balance the risk, so we have avoided them in this portfolio.
- Exposure to retail is less than 35%. We have avoided malls, and most of the retail we own is strip malls or services that we believe are not going to be easily replaced by Google-type businesses, especially near-term.
- Top Ten Sectors (As of 5/31/2017) :
- Computers & Electronics, 13.03%
- Health Care, 12.32%
- Leisure Goods/Activities/Movies, 6.17%
- Retailers (Except Food & Drug), 5.40%
- Chemicals & Plastics, 5.24%
- Telecom, 4.25%
- Industrial Equipment & Services, 3.44%
- Business Equipment & Services, 3.44%
- Food Products, 3.41%
- Surface Transport, 3.33%
- Portfolio Characteristics (As of 5/31/2017) :
- 164 issuers, current market price of $100.29
- Duration is 0.31 years
- Weighted Average Life is 5.60
See the full webcast slides below.