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Harbor Core Plus Fund Strategy Profile
April 24, 2024| Average Annual Returns as of 03/31/2023 | ||||||||
|---|---|---|---|---|---|---|---|---|
| 3 Months | YTD | 1 Yr. | 3 Yr. | 5 Yr. | 10 Yr. | Since Inception | Inception Date | |
| Harbor Core Plus Fund (Instl) | -0.22% | -0.22% | 2.96% | -1.90% | 1.02% | 1.97% | 6.03% | 12/29/1987 |
| Bloomberg US Aggregate Bond Index | -0.78% | -0.78% | 1.70% | -2.46% | 0.36% | 1.54% | 5.37% | 12/29/1987 |
Performance data shown represents past performance and is no guarantee of future results. Past performance is net of management fees and expenses and reflects reinvested dividends and distributions. Past performance reflects the beneficial effect of any expense waivers or reimbursements, without which returns would have been lower. Investment returns and principal value will fluctuate and when redeemed may be worth more or less than their original cost. Returns for periods less than one year are not annualized. Current performance may be higher or lower and is available through the most recent month end at harborcapital.com or by calling 800-422-1050. For most current performance please click here.
- Since taking over management of Harbor Core Plus in Feb 2022 (first full month, March 2022), the Fund ranked in the 42nd percentile, based on Total return, among peers in the Morningstar US Intermediate Core-Plus Category for performance.
- In addition, from a benchmark-relative perspective, Harbor Core Plus exhibited 83rd percentile tracking error. This placed its risk-adjusted return (information ratio) near the category’s top third with a 34th percentile ranking.
Source: Morningstar Direct. Performance data shown represents past performance and is no guarantee of future results. As of 03/31/2024 out of 649 funds. The highest (or most favorable) percentile rank is 1 and the lowest (or least favorable) percentile rank is 100. Fund performance used within the rankings, reflects any certain fee waivers, without which, returns and Morningstar rankings would have been lower. Please see Important Information section for full period of Fund rankings.
- Importantly, the Fund’s disciplined approach has led to consistency of monthly outperformance versus the Bloomberg US Aggregate Bond Index. Per the chart below, Harbor Core Plus outperformed its benchmark in 16 of 25 months (64% batting average) since taking over the fund in Feb 2022.
1 This is not the performance of the Harbor Core Plus Fund. As of March 31, 2024, the IR+M Composite was composed of 6 accounts, totaling approximately $1.3 billion. The inception date of the Composite was August 1, 2017.
Performance data shown represents past performance and is no guarantee of future results. Past performance is net of management fees and expenses and reflects reinvested dividends and distributions. Past performance reflects the beneficial effect of any expense waivers or reimbursements, without which returns would have been lower. Investment returns and principal value will fluctuate and when redeemed may be worth more or less than their original cost. Returns for periods less than one year are not annualized. Current performance may be higher or lower and is available through the most recent month end at harborcapital.com or by calling 800-422-1050. Source: Morningstar Direct.
- Founded in 1987, Income Research + Management (IR+M) is an independent, privately owned boutique investment firm based in Boston, MA.
- Ownership is widely dispersed at the firm across 66 employee shareholders*, including the majority of the firm’s investment team.
- As of 3/31/2024, the firm has $98B in AUM, exclusively across US dollar-denominated fixed income. Unlike many competing fixed income organizations, IR+M utilizes no derivatives, foreign currency or leverage across its strategies.
- The firm’s Core Plus strategy incepted in July 2017 and represents an expanded toolkit of the firm’s flagship Aggregate strategy which incepted more than 30 years ago in Dec 1991. Core Plus Assets as of 3/31/2024 are $1.35B.
- IR+M utilizes a team-oriented, bottom-up investment approach utilizing sector-specialized research analysts, portfolio managers and traders. Portfolio managers have an average 13-year tenure at the firm.
- Whereas many firms silo research, portfolio management and trading, IR+M employs a collaborative approach to these important functions. They believe this is particularly important within fixed income as individual issuers may have hundreds of bonds outstanding, making collaboration across the investment team to populate portfolios with the best raw material available paramount to success.
William O' Malley, CFA
CEO, Co-CIO
36 years experience*
James Gubitosi, CFA
Co-CIO
20 years experience*
Bill O'Neill, CFA
Principal, Senior PM
24 years experience*
Jake Remley, CFA
Principal, Senior PM
23 years experience*
Matt Walker, CFA
Senior PM
21 years experience*
Rachel Campbell
PM, Director of Securitized Research
18 years experience*
*As of 12/31/2023
- IR+M’s investment process is driven by bottom-up security selection, with sector allocations driven through relative value and risk/liquidity assessments by the firm’s investment committee
- The firm employs a duration and key-rate neutral approach to investing (+/- 0.5 yrs of the benchmark), believing that this leads to more consistent results over time relative to potentially more volatile macro decisions. IR+M believes that very few professionals, if any, can consistently and accurately predict the direction and magnitude of interest rate changes
- Individual issues are evaluated by sector specialized research analysts and are assessed through a disciplined framework evaluating the credit, structure and price dynamics of each bond. Given IR+M’s relatively modest size they believe that they can be highly selective and can access smaller sub-sectors that larger managers struggle to tap into
- Portfolios are managed using an active risk management overlay. IR+M aims to build a portfolio with a yield advantage over the benchmark with similar average quality. The team will provide liquidity when spreads are generous but maintains a quality bias across a full market cycle. The firm’s mantra is to “take what the market gives you…”
| Share Class | Institutional |
|---|---|
| Cusip | 411512189 |
| Fund Number | 2014 |
| Net Expense Ratio* | 0.38% |
| Gross Expense Ratio | 0.38% |
| Inception Date | 12/29/1987 |
| Manager Name | Income Research + Management |
| Benchmark | Bloomberg US Aggregate Bond Index |
| Morningstar Category | Intermediate Core-Plus Bond |
*The net expense ratios for this fund are subject to a contractual management fee waiver and/or an expense limitation agreement excluding interest expense and acquired fund fees and expenses (if any) through 02/28/2025.
As of 03/31/2024. For Illustrative Purposes Only.
Important Information
For Institutional use only.
There is no guarantee that the investment objective of the Fund will be achieved. Fixed income investments are affected by interest rate changes and the creditworthiness of the issues held by the Fund. As interest rates rise, the values of fixed income securities held by the Fund are likely to decrease and reduce the value of the Fund's portfolio. There may be a greater risk that the Fund could lose money due to prepayment and extension risks because the Fund invests, at times, in mortgage-related and/or asset backed securities.
The Morningstar Rankings are based on total returns, with distributions reinvested and operating expenses deducted. Morningstar does not take into account sales charges and other classes may have different performance characteristics. Harbor Core Plus Instl was ranked against Morningstar’s Intermediate Core-Plus Bond category, monthly, in absolute ranks based on total returns: 252 out of 599 investments in the category for the 1-year period, 132 out of 553 investments in the category for the 3-year period, 165 out of 541 investments in the category for the 5-year period, 137 out of 465 investments in the category for the 10-year period as of 03/31/2024. Using the same category, Harbor Core Plus Instl was ranked in standard deviation ranks: 407 out of 599 investments in the category for the 1-year period, 419 out of 553 investments in the category for the 3-year period, 471 out of 541 investments in the category for the 5-year period, 403 out of 465 investments in the category for the 10-year period as of 03/31/2024. Using the same category, Harbor Core Plus Instl was ranked in beta ranks: 385 out of 599 investments in the category for the 1-year period, 397 out of 553 investments in the category for the 3-year period, 383 out of 541 investments in the category for the 5-year period, 317 out of 465 investments in the category for the 10-year period as of 03/31/2024. Using the same category, Harbor Core Plus Instl was ranked in tracking error ranks: 443 out of 599 investments in the category for the 1-year period, 494 out of 553 investments in the category for the 3-year period, 517 out of 541 investments in the category for the 5-year period, 408 out of 465 investments in the category for the 10-year period as of 03/31/2024. Using the same category, Harbor Core Plus Instl was ranked in information ratio ranks: 180 out of 599 investments in the category for the 1-year period, 89 out of 553 investments in the category for the 3-year period, 29 out of 541 investments in the category for the 5-year period, 63 out of 465 investments in the category for the 10-year period as of 03/31/2024. Using the same category, Harbor Core Plus Instl was ranked batting average ranks: 50 out of 599 investments in the category for the 1-year period, 146 out of 553 investments in the category for the 3-year period, 127 out of 541 investments in the category for the 5-year period, 79 out of 465 investments in the category for the 10-year period as of 03/31/2024. The highest (or most favorable) percentile rank is 1 and the lowest (or least favorable) percentile rank is 100.
Standard deviation measures the dispersion of a dataset relative to its mean.
Beta is a measure of systematic risk, or the sensitivity of a fund to movements in the benchmark. A beta of 1 implies that the expected movement of a fund's return would match that of the benchmark used to measure beta.
Tracking Error is the standard deviation of a portfolio’s relative return (relative to some benchmark). It measures the volatility of the return differences between the portfolio and the benchmark over time.
The Information Ratio (Info Ratio) of a manager series vs. a benchmark series is the quotient of the annualized excess return and the annualized standard deviation of excess return.
The Batting Average of the manager is the ratio between the number of periods where the manager outperforms a benchmark and the total number of periods.
The views expressed herein may not be reflective of current opinions, are subject to change without prior notice, and should not be considered investment advice or a recommendation to purchase a particular security.
Income Research + Management is a third-party subadvisor to the Harbor Core Plus Fund.
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