The rise of so-called unconstrained bond funds is a positive trend because the increased flexibility enables managers to move to safety when trouble arises, said Jerry Murphy, CEO of FolioMetrix. For example, Murphy said the portfolio managers in the FolioMetrix RiskX family of funds saw problems in the energy sector forthcoming and were able to mitigate risk by effectively reducing their high yield positions. He added that managers are compensated for their expertise and should be empowered to make decisions within their portfolios as long as they stick to their strategies.
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