Investment Philosophy

The Canadian Fixed Income team believes the key to adding value is understanding the drivers and relative attractiveness of all global fixed-income categories and currencies. This knowledge is applied to a strategic allocation of fixed-income categories and active currency management.

Investment Process

The AGF Emerging Markets Debt strategy offers investors access to all three major bond categories: local rates, EM corporate debt and external debt. The team actively manages EM currency exposure and is able to exploit attractive opportunities and target more liquid currency markets with the currency overlay process.

Macroeconomic Fundamental Research: An in-depth forward view of the macroeconomic fixed income environment is developed. This research focuses on key market drivers including monetary and fiscal policies, inflation, credit quality and currencies.

Fixed Income Category Analysis: The team then forecasts the direction and magnitude of changes in the identified market drivers within EM sovereign bonds through local currency, external debt and EM corporate debt.

Portfolio Construction: Relative value consideration, and overall country and duration decisions are established to strategically allocate fixed income within three major bond categories: local rates, external debt and corporate credit.

Currency Overlay Implementation: The team actively manages EM currency exposure and is able to exploit attractive opportunities and target more liquid currency markets with the currency overlay process.

Risk Management: The team quantifies and actively manages potential risk exposures. If the active risk is not aligned with the portfolio's return objective, the team revisits the portfolio construction and makes the necessary adjustments that will deliver the target risk level.