Morningstar Magazine - June/July 2018 - 85
Strategies
Patience Required
A strong fund for those who can ride out volatility.
BEST ID EAS: MAN AGER
Sarah Bush
Loomis Sayles Strategic Income NEZYX
This article is adapted from the fund's Morningstar Global Fund Report dated
March 23, 2018.
Stats 03/31/2018
Loomis Sayles Strategic Income NEZYX lands at the aggressive end of the
multisector-bond Morningstar Category, taking on even more risk than
its intrepid sibling Loomis Sayles Bond LSBRX. For those with the requisite
patience, the team's depth of experience and its success plying an often
contrarian approach support a Morningstar Analyst Rating of Silver.
Morningstar Category
Multisector Bond
Expense Ratio
0.71%
Fee Level
Average
5-Yr Annlzd Return
4.36%
5-Yr % Rank in Cat
11
Morningstar Pillars 03/31/2018
Process
∞ Positive
At the core of this fund's appeal is its knack for uncovering value in beatendown corporates-and even the occasional troubled sovereign. The
team of bond fund legend Dan Fuss, veteran comanagers Elaine Stokes and
Matt Eagan, and recent addition Brian Kennedy is quick to pick up
bargains when credit markets turn rocky. For example, the team piled into
Irish sovereign debt at the worst of that country's troubles in late 2010.
And as a plunge in energy prices drove high-yield losses starting in mid-2014,
the team added to names that it thought most likely to survive, which
boosted returns in 2016 and 2017. Such moves have helped the fund to a
6.3% 10-year annualized gain through February that tops roughly 80% of its
distinct peers.
Performance
∞ Positive
People
∞ Positive
Parent
¶ Neutral
Price
¶ Neutral
Growth of 10K 03/31/2018
$12K
Morningstar US Core Bond TR
11
10.93
10.41
10
Loomis Sayles Strategic Income
9
8
04/2015
04/2016
04/2017
Fixed Income Style Box 02/28/2018
High
Interest Rate Sensitivity
Morningstar Ratings 03/31/2018
Data surveyed
from the
fund company.
Low
Mid
Credit Quality
These gains have come with a hefty dose of risk. At its peak in late 2015,
the fund's equity stake checked in at more than 20% of assets. Citing tight
valuations and the potential for geopolitical risk to upend global risk
markets, the team had slashed this position to roughly 7% as of February,
while building cash to 20% of assets. Still, the fund's equity stake stood
out in a category where two thirds of competitors have little or no exposure
to common stock. Meanwhile, the fund continued to dedicate close
to a third of assets to junk bonds and featured a 21% exposure to non-U.S.dollar currencies.
Morningstar Analyst Rating
*
Ltd
Mod
Period
Mstar
Return
Mstar
Risk
Mstar
Rating
3-Yr
Average
High
QQQ
5-Yr
Above Avg High
QQQQ
10-Yr
Above Avg High
QQQQ
QQQQ
Overall Rating
Ext
Top 5 Sectors 02/28/2018
Not surprisingly, the fund is vulnerable to sharp losses during periods of
volatility in the credit and currency markets. Indeed, the fund fell 12% between
September 2014 and January 2016 as its junk-bond holdings and commoditysensitive currencies drove losses. Still, for those comfortable with the fund's
volatility, it remains a strong choice. K
Sarah Bush is director, fixed-income strategies, with Morningstar Research Services.
Sectors
■ Fund
❙ Category Average
Corporate Bond
32.92
Non-U.S. Government
U.S. Treasury
14.19
8.14
5.35
42.33
6.94
1.45 3.87
Convertible
Bank Loan
0.49 1.29
0%
15
30
45
global.morningstar.com/Morningstarmagazine
60
85
http://global.morningstar.com/Morningstarmagazine
Table of Contents for the Digital Edition of Morningstar Magazine - June/July 2018
Contents
Morningstar Magazine - June/July 2018 - Cover1
Morningstar Magazine - June/July 2018 - Cover2
Morningstar Magazine - June/July 2018 - 1
Morningstar Magazine - June/July 2018 - 2
Morningstar Magazine - June/July 2018 - Contents
Morningstar Magazine - June/July 2018 - 4
Morningstar Magazine - June/July 2018 - 5
Morningstar Magazine - June/July 2018 - 6
Morningstar Magazine - June/July 2018 - 7
Morningstar Magazine - June/July 2018 - 8
Morningstar Magazine - June/July 2018 - 9
Morningstar Magazine - June/July 2018 - 10
Morningstar Magazine - June/July 2018 - 11
Morningstar Magazine - June/July 2018 - 12
Morningstar Magazine - June/July 2018 - 13
Morningstar Magazine - June/July 2018 - 14
Morningstar Magazine - June/July 2018 - 15
Morningstar Magazine - June/July 2018 - 16
Morningstar Magazine - June/July 2018 - 17
Morningstar Magazine - June/July 2018 - 18
Morningstar Magazine - June/July 2018 - 19
Morningstar Magazine - June/July 2018 - 20
Morningstar Magazine - June/July 2018 - 21
Morningstar Magazine - June/July 2018 - 22
Morningstar Magazine - June/July 2018 - 23
Morningstar Magazine - June/July 2018 - 24
Morningstar Magazine - June/July 2018 - 25
Morningstar Magazine - June/July 2018 - 26
Morningstar Magazine - June/July 2018 - 27
Morningstar Magazine - June/July 2018 - 28
Morningstar Magazine - June/July 2018 - 29
Morningstar Magazine - June/July 2018 - 30
Morningstar Magazine - June/July 2018 - 31
Morningstar Magazine - June/July 2018 - 32
Morningstar Magazine - June/July 2018 - 33
Morningstar Magazine - June/July 2018 - 34
Morningstar Magazine - June/July 2018 - 35
Morningstar Magazine - June/July 2018 - 36
Morningstar Magazine - June/July 2018 - 37
Morningstar Magazine - June/July 2018 - 38
Morningstar Magazine - June/July 2018 - 39
Morningstar Magazine - June/July 2018 - 40
Morningstar Magazine - June/July 2018 - 41
Morningstar Magazine - June/July 2018 - 42
Morningstar Magazine - June/July 2018 - 43
Morningstar Magazine - June/July 2018 - 44
Morningstar Magazine - June/July 2018 - 45
Morningstar Magazine - June/July 2018 - 46
Morningstar Magazine - June/July 2018 - 47
Morningstar Magazine - June/July 2018 - 48
Morningstar Magazine - June/July 2018 - 49
Morningstar Magazine - June/July 2018 - 50
Morningstar Magazine - June/July 2018 - 51
Morningstar Magazine - June/July 2018 - 52
Morningstar Magazine - June/July 2018 - 53
Morningstar Magazine - June/July 2018 - 54
Morningstar Magazine - June/July 2018 - 55
Morningstar Magazine - June/July 2018 - 56
Morningstar Magazine - June/July 2018 - 57
Morningstar Magazine - June/July 2018 - 58
Morningstar Magazine - June/July 2018 - 59
Morningstar Magazine - June/July 2018 - 60
Morningstar Magazine - June/July 2018 - 61
Morningstar Magazine - June/July 2018 - 62
Morningstar Magazine - June/July 2018 - 63
Morningstar Magazine - June/July 2018 - 64
Morningstar Magazine - June/July 2018 - 65
Morningstar Magazine - June/July 2018 - 66
Morningstar Magazine - June/July 2018 - 67
Morningstar Magazine - June/July 2018 - 68
Morningstar Magazine - June/July 2018 - 69
Morningstar Magazine - June/July 2018 - 70
Morningstar Magazine - June/July 2018 - 71
Morningstar Magazine - June/July 2018 - 72
Morningstar Magazine - June/July 2018 - 73
Morningstar Magazine - June/July 2018 - 74
Morningstar Magazine - June/July 2018 - 75
Morningstar Magazine - June/July 2018 - 76
Morningstar Magazine - June/July 2018 - 77
Morningstar Magazine - June/July 2018 - 78
Morningstar Magazine - June/July 2018 - 79
Morningstar Magazine - June/July 2018 - 80
Morningstar Magazine - June/July 2018 - 81
Morningstar Magazine - June/July 2018 - 82
Morningstar Magazine - June/July 2018 - 83
Morningstar Magazine - June/July 2018 - 84
Morningstar Magazine - June/July 2018 - 85
Morningstar Magazine - June/July 2018 - 86
Morningstar Magazine - June/July 2018 - 87
Morningstar Magazine - June/July 2018 - 88
Morningstar Magazine - June/July 2018 - 89
Morningstar Magazine - June/July 2018 - 90
Morningstar Magazine - June/July 2018 - 91
Morningstar Magazine - June/July 2018 - 92
Morningstar Magazine - June/July 2018 - 93
Morningstar Magazine - June/July 2018 - 94
Morningstar Magazine - June/July 2018 - 95
Morningstar Magazine - June/July 2018 - 96
Morningstar Magazine - June/July 2018 - 97
Morningstar Magazine - June/July 2018 - 98
Morningstar Magazine - June/July 2018 - 99
Morningstar Magazine - June/July 2018 - 100
Morningstar Magazine - June/July 2018 - 101
Morningstar Magazine - June/July 2018 - 102
Morningstar Magazine - June/July 2018 - 103
Morningstar Magazine - June/July 2018 - 104
Morningstar Magazine - June/July 2018 - 105
Morningstar Magazine - June/July 2018 - 106
Morningstar Magazine - June/July 2018 - 107
Morningstar Magazine - June/July 2018 - 108
Morningstar Magazine - June/July 2018 - 109
Morningstar Magazine - June/July 2018 - 110
Morningstar Magazine - June/July 2018 - 111
Morningstar Magazine - June/July 2018 - 112
Morningstar Magazine - June/July 2018 - Cover3
Morningstar Magazine - June/July 2018 - Cover4
Morningstar Magazine - June/July 2018 - Cover1I
Morningstar Magazine - June/July 2018 - Cover2I
Morningstar Magazine - June/July 2018 - I3
Morningstar Magazine - June/July 2018 - I4
Morningstar Magazine - June/July 2018 - I5
Morningstar Magazine - June/July 2018 - I6
Morningstar Magazine - June/July 2018 - I7
Morningstar Magazine - June/July 2018 - I8
Morningstar Magazine - June/July 2018 - I9
Morningstar Magazine - June/July 2018 - I10
Morningstar Magazine - June/July 2018 - I11
Morningstar Magazine - June/July 2018 - I12
Morningstar Magazine - June/July 2018 - I13
Morningstar Magazine - June/July 2018 - I14
Morningstar Magazine - June/July 2018 - I15
Morningstar Magazine - June/July 2018 - I16
Morningstar Magazine - June/July 2018 - I17
Morningstar Magazine - June/July 2018 - I18
Morningstar Magazine - June/July 2018 - I19
Morningstar Magazine - June/July 2018 - I20
Morningstar Magazine - June/July 2018 - I21
Morningstar Magazine - June/July 2018 - I22
Morningstar Magazine - June/July 2018 - I23
Morningstar Magazine - June/July 2018 - I24
Morningstar Magazine - June/July 2018 - I25
Morningstar Magazine - June/July 2018 - I26
Morningstar Magazine - June/July 2018 - I27
Morningstar Magazine - June/July 2018 - I28
Morningstar Magazine - June/July 2018 - I29
Morningstar Magazine - June/July 2018 - I30
Morningstar Magazine - June/July 2018 - I31
Morningstar Magazine - June/July 2018 - Cover4I
https://www.nxtbook.com/nxtbooks/morningstar/magazine_2024q3
https://www.nxtbook.com/nxtbooks/morningstar/magazine_2024q2
https://www.nxtbook.com/nxtbooks/morningstar/magazine_2024q1
https://www.nxtbook.com/nxtbooks/morningstar/magazine_2023q4
https://www.nxtbook.com/nxtbooks/morningstar/magazine_2023q3
https://www.nxtbook.com/nxtbooks/morningstar/magazine_2023q2
https://www.nxtbook.com/nxtbooks/morningstar/magazine_2023q1
https://www.nxtbook.com/nxtbooks/morningstar/magazine_2022q4
https://www.nxtbook.com/nxtbooks/morningstar/magazine_2022q3
https://www.nxtbook.com/nxtbooks/morningstar/magazine_2022q2
https://www.nxtbook.com/nxtbooks/morningstar/magazine_2022q1
https://www.nxtbook.com/nxtbooks/morningstar/magazine_2021q4
https://www.nxtbook.com/nxtbooks/morningstar/magazine_2021q3
https://www.nxtbook.com/nxtbooks/morningstar/magazine_2021q2
https://www.nxtbook.com/nxtbooks/morningstar/magazine_2021q1
https://www.nxtbook.com/nxtbooks/morningstar/magazine_2020q4
https://www.nxtbook.com/nxtbooks/morningstar/magazine_2020q3
https://www.nxtbook.com/nxtbooks/morningstar/magazine_2020q2
https://www.nxtbook.com/nxtbooks/morningstar/magazine_2020q1
https://www.nxtbook.com/nxtbooks/morningstar/magazine_2019winter
https://www.nxtbook.com/nxtbooks/morningstar/magazine_2019fall
https://www.nxtbook.com/nxtbooks/morningstar/magazine_2019summer
https://www.nxtbook.com/nxtbooks/morningstar/magazine_2019spring
https://www.nxtbook.com/nxtbooks/morningstar/magazine_20191201
https://www.nxtbook.com/nxtbooks/morningstar/magazine_20181011
https://www.nxtbook.com/nxtbooks/morningstar/magazine_20180809
https://www.nxtbook.com/nxtbooks/morningstar/magazine_20180607
https://www.nxtbook.com/nxtbooks/morningstar/magazine_20180405
https://www.nxtbook.com/nxtbooks/morningstar/magazine_20180203
https://www.nxtbook.com/nxtbooks/morningstar/magazine_20181201
https://www.nxtbook.com/nxtbooks/morningstar/magazine_20171011
https://www.nxtbook.com/nxtbooks/morningstar/magazine_20170809
https://www.nxtbook.com/nxtbooks/morningstar/magazine_20170607
https://www.nxtbook.com/nxtbooks/morningstar/magazine_20170405
https://www.nxtbook.com/nxtbooks/morningstar/magazine_20170203
https://www.nxtbook.com/nxtbooks/morningstar/magazine_20171201
https://www.nxtbook.com/nxtbooks/morningstar/magazine_20161011
https://www.nxtbook.com/nxtbooks/morningstar/magazine_20160809
https://www.nxtbook.com/nxtbooks/morningstar/magazine_20160607
https://www.nxtbook.com/nxtbooks/morningstar/magazine_20160405
https://www.nxtbook.com/nxtbooks/morningstar/magazine_20160203
https://www.nxtbook.com/nxtbooks/morningstar/magazine_20161201
https://www.nxtbook.com/nxtbooks/morningstar/magazine_20151011
https://www.nxtbook.com/nxtbooks/morningstar/magazine_20150809
https://www.nxtbook.com/nxtbooks/morningstar/magazine_20150607
https://www.nxtbook.com/nxtbooks/morningstar/magazine_20150405
https://www.nxtbook.com/nxtbooks/morningstar/magazine_20150203
https://www.nxtbook.com/nxtbooks/morningstar/magazine_20151201
https://www.nxtbook.com/nxtbooks/morningstar/magazine_20141011
https://www.nxtbook.com/nxtbooks/morningstar/magazine_20140809
https://www.nxtbook.com/nxtbooks/morningstar/magazine_20140607
https://www.nxtbook.com/nxtbooks/morningstar/magazine_20140405
https://www.nxtbook.com/nxtbooks/morningstar/magazine_20140203
https://www.nxtbook.com/nxtbooks/morningstar/advisor_20141201
https://www.nxtbook.com/nxtbooks/morningstar/advisor_20131011
https://www.nxtbook.com/nxtbooks/morningstar/advisor_20130809
https://www.nxtbook.com/nxtbooks/morningstar/advisor_20130607
https://www.nxtbook.com/nxtbooks/morningstar/advisor_20130405
https://www.nxtbook.com/nxtbooks/morningstar/advisor_20130203
https://www.nxtbook.com/nxtbooks/morningstar/advisor_20131201
https://www.nxtbook.com/nxtbooks/morningstar/advisor_20121011
https://www.nxtbook.com/nxtbooks/morningstar/advisor_20120809
https://www.nxtbook.com/nxtbooks/morningstar/advisor_20120607
https://www.nxtbook.com/nxtbooks/morningstar/advisor_20120405
https://www.nxtbook.com/nxtbooks/morningstar/advisor_20120203
https://www.nxtbook.com/nxtbooks/morningstar/advisor_20121201
https://www.nxtbook.com/nxtbooks/morningstar/advisor_20111011
https://www.nxtbook.com/nxtbooks/morningstar/advisor_20110809
https://www.nxtbook.com/nxtbooks/morningstar/advisor_20110607
https://www.nxtbook.com/nxtbooks/morningstar/advisor_20110405
https://www.nxtbook.com/nxtbooks/morningstar/advisor_20110203
https://www.nxtbook.com/nxtbooks/morningstar/advisor_20111201
https://www.nxtbook.com/nxtbooks/morningstar/advisor_20101011
https://www.nxtbook.com/nxtbooks/morningstar/advisor_20100809
https://www.nxtbook.com/nxtbooks/morningstar/advisor_20100607
https://www.nxtbook.com/nxtbooks/morningstar/advisor_20100405
https://www.nxtbook.com/nxtbooks/morningstar/advisor_20100203
https://www.nxtbook.com/nxtbooks/morningstar/advisor_20101201
https://www.nxtbook.com/nxtbooks/morningstar/advisor_20091011
https://www.nxtbook.com/nxtbooks/morningstar/advisor_20090809
https://www.nxtbook.com/nxtbooks/morningstar/advisor_20090607
https://www.nxtbook.com/nxtbooks/morningstar/advisor_20090405
https://www.nxtbook.com/nxtbooks/morningstar/advisor_20090203
https://www.nxtbook.com/nxtbooks/morningstar/advisor_2008fall
https://www.nxtbook.com/nxtbooks/morningstar/advisor_2008summer
https://www.nxtbook.com/nxtbooks/morningstar/advisor_2007spring
https://www.nxtbook.com/nxtbooks/morningstar/advisor_2007fall
https://www.nxtbook.com/nxtbooks/morningstar/advisor_2007summer
https://www.nxtbook.com/nxtbooks/morningstar/advisor_2008spring
https://www.nxtbook.com/nxtbooks/morningstar/advisor_2008catalog
https://www.nxtbook.com/nxtbooks/morningstar/advisor_2008winter
https://www.nxtbookmedia.com