Municipal Market Investment Advisors

"We're in the stay rich business, not the get rich business."
-
Craig W. Henderson

Monday, September 25, 2017

Philosophy

At C.W. Henderson & Associates, Inc. we view our clients' municipal bond portfolios as the safe harbor components of their overall investment accounts. Therefore, we maintain very high credit quality in their portfolios (average quality is typically AA or higher) and do not take significant duration risk. Credit, sector and state diversification guidelines provide additional risk control. One of our prime objectives is to never have our clients experience a negative total return in any year. Return enhancements are attained through the application of our investment strategies, duration targeting and active portfolio management.

Portfolio Strategies

  • Active Management - Portfolios are actively managed to generate returns in excess of Bloomberg Barclays Municipal GO Index. Portfolio turnover will vary based on market opportunities such as tax loss harvesting and yield curve shifts.
  • Barbell Portfolio Structure - Contrasting an index of laddered portfolios, a barbell structure allows greater flexibility in duration management while reducing volatility risk.
  • Relative Value Tactics - Bonds are selected for purchase based on their relative value. Security structure, credit sector, and yield curve position are analyzed to identify attractive securities.
  • High Quality - Bonds must be rated "A" or higher by rating agencies (Moody's, Standard and Poors, Fitch) and average aggregate portfolio ratings are AA+. Credit quality is diligently monitored.
  • High Liquidity - Portfolio liquidity is crucial to active management. We invest only in bonds with strong liquidity characteristics. Portfolio managers with extensive market expertise monitor bond market trading volumes and prices in the secondary markets on a daily basis.
  • Tax Management - Capital losses are realized when available. Trades that may realize capital gains are managed to minimize tax effects.