If you have a taxable account, you may benefit from tax-exempt bond portfolios, because their income is largely exempt from federal taxes and, in some cases, state and local taxes. We are opportunistic in our investments, however. If certain taxable bonds offer you higher after-federal-tax return potential than municipal bonds, we may invest in them. Of course, some income may be subject to state and local taxes as well as the federal alternative minimum tax, so consider your personal tax situation before investing in municipal bonds.
Bernstein employs a large, dedicated municipal bond research team to monitor legal, economic and market risks that might affect the value of these bonds.
We diversify our taxable portfolios across most sectors of the US bond market and, opportunistically, major foreign bond markets. We actively manage sector and security concentrations, maturity combinations and foreign currency exposures for the highest returns consonant with prudent risk.
A Research-Driven Approach
We believe that successful bond investing begins with proprietary fundamental and quantitative research, intelligent interpretation of that research, and agile execution of strategies. Fixed income research forms the core of our investment process, and constant interaction between researchers and portfolio managers ensures a dynamic, energized process that takes full advantage of our resources.