To help investors allocate capital in potentially high-yielding fixed income markets, while cushioning their portfolio against various types of downside risk.
The application of three layers of risk control, or 'hedges': portfolio diversification, dynamic market hedge, and emergency hedge
April 29, 2011
BofA Merrill Lynch 3-Month LIBOR Index¹
Beyond Traditional Diversification
To help fixed income investors pursue diversification* and income generation in this evolving credit market environment, Pioneer Investments developed Pioneer Absolute Return Credit Fund (Class A: RCRAX). This multi-sector fixed income portfolio is designed to help investors:
- Buffer the effects of volatility during extreme market conditions through a multi-layered risk management strategy, which incorporates broad diversification* across multiple credit sectors and geographies as well as cost-effective hedges that aim to smooth the effects of volatility over time.
- Use market volatility as a tool to take advantage of opportunities across credit markets. The Fundís structure allows portfolio management to invest anywhere in the credit markets, in almost any fixed income security.
* Diversification does not assure a profit or protect against loss in a declining market.
A Multi-Layered Approach to Managing Risk
Traditional strategies for managing risk in a fixed income portfolio have involved increasing the credit quality of the portfolio and/or moving a portion of assets to lower-risk, government based securities. Implementing these strategies requires portfolio management to make significant and sometimes costly allocation adjustments that can take several weeks or even months.
Pioneer Absolute Return Credit Fund was designed to combat these challenges more quickly and effectively through the application of three layers of risk control, or 'hedges'.
Click for more details on the Fund's strategy...
- Emergency Hedge — Activated in periods of extreme market stress or unanticipated volatility
- Dynamic Hedge — Dynamically adjusts to changes in spreads and market volatility
- Underlying Portfolio Diversification — The Fund may invest in a broad range of varied levels of credit quality and duration
Why Consider Pioneer Absolute Return Credit Fund?
- Credit-oriented to pursue opportunities across all credit market environments
- Risk management through an innovative, multi-layered strategy
- Professional management and insight that removes the intricate work of managing credit exposure from the shoulders of investors.
Is Pioneer Absolute Return Credit Fund Right for You?
Today's tumultuous fixed income markets require an investment approach that seeks both to buffer the effects of volatility as well as harness the opportunities that it can produce. Pioneer Absolute Return Credit Fund is designed to accomplish these goals for investors as they seek to diversify their portfolios and generate income. Contact your financial advisor for more information about the Fund, or visit us.pioneerinvestments.com.
Why Choose Pioneer for Fixed Income?
Pioneerís core U.S. fixed income team includes 24 portfolio managers, analysts and traders, averaging over 20 years of experience. Our extensive credit management expertise and rigorous approach to research underlie the strategies behind all of our actively managed bond funds. Our collaborative environment encourages team members to "think outside the box" in developing innovative products to address the changing needs and ongoing challenges of investors.