Western Asset, one of the world’s leading fixed income managers, in partnership with parent company Franklin Templeton, has launched the Western Asset Long Credit VIT. The fund is a series of Legg Mason Partners Variable Income Trust. Legg Mason Partners Fund Advisor, LLC (“LMPFA”) acts as the Fund’s investment manager. Western Asset Management Company, LLC and Western Asset Management Company Limited act as the Fund’s sub-advisers. Western Asset has been one of Franklin Templeton’s autonomous specialist investment managers since July 2020.
Western Asset, one of the world’s leading fixed income managers, in partnership with parent company Franklin Templeton, has launched the Western Asset Long Credit VIT. Western Asset has $402 billion in total assets under management as of March 31, 2023.
Shares of the Fund may only be purchased or redeemed through variable annuity contracts and variable life insurance policies offered by the separate accounts of participating life insurance companies or through eligible pension or other qualified plans.
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The Fund’s investment objective is total return consistent with prudent investment management. Under normal circumstances, the fund invests at least 80% of its net assets, plus the amount of any borrowings for investment purposes, in fixed income securities. Western Asset seeks total return from a portfolio constructed primarily of long investment-grade corporate bonds across a broad range of issuers and industries while incorporating opportunistic investments in sectors such as high-yield credit, structured securities and emerging markets.
The Fund normally seeks to maintain a dollar-weighted average effective duration within 10% of the average effective duration of a custom benchmark, which is composed of a 60% weighting to the Bloomberg US Long Credit Index and 40% weighting to the Bloomberg US Intermediate Credit Index. Effective duration seeks to measure the expected sensitivity of market price to changes in interest rates, taking into account the anticipated effects of structural complexities; for example, some bonds can be prepaid by the issuer.
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Western Asset began managing long duration products in 1989. The firm currently manages $402 billion in total assets under management as of March 31, 2023, of which $65.5 billion is in corporate credit and $10 billion is in long duration assets.
“We employ a team-based approach to active investment management that’s centered around a long-term, value-oriented investment philosophy. The portfolio will incorporate our top-down macro-economic views with our credit analysts’ fundamental and relative value views regarding industry and issuer opportunities,” said Ryan K. Brist, Western Asset’s Head of Global Investment Grade Credit and Portfolio Manager. “Our hallmark team-based approach and intensive proprietary research are supported by robust risk management processes.”
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