A ‘Buy & Maintain’ approach is anything but passive. The bond market equivalent ‘Buy & Hold’ management, the strategy features low portfolio turnover, as most assets are intended to be held to maturity.
For a Buy & Maintain investment manager, what’s most important is the probability of not defaulting through to maturity
- A selection of securities designed to be held to maturity
- Active monitoring of portfolio positions based on in-depth credit analysis
- Possibility of conducting arbitrage to:
- capture market opportunities for improved yield
- sell securities to avoid default
- Low portfolio turnover that optimises transaction costs