Diamond Hill Launches Two New Fixed Income Mutual Funds
- Diamond Hill Short Duration Total Return and Diamond Hill Core Bond strategies now available as mutual funds and institutional separate accounts.
- New portfolio management team brings unique experience to Diamond Hill with consistent intrinsic value philosophy.
COLUMBUS, Ohio – September 21, 2016 – Diamond Hill Capital Management, Inc., a subsidiary of Diamond Hill Investment Group, Inc. (NASDAQ: DHIL), announced the launch of the Diamond Hill Short Duration Total Return Fund and the Diamond Hill Core Bond Fund. Managed by Henry Song, CFA and Mark Jackson, CFA, both strategies are also available as institutional separate accounts.
“Henry and Mark have worked side-by-side for the last 10 years, applying a consistent, bottom up, intrinsic value-based investment philosophy and process to a style-pure core fixed income strategy. They will apply this same philosophy and process to the two new funds. Diamond Hill provides the right environment for them to successfully navigate the constantly changing fixed income markets as they seek to provide value-added returns for our clients,” said Bill Zox, Chief Investment Officer – Fixed Income, Diamond Hill.
Zox said, “The Short Duration Total Return Fund is a unique offering in the investment grade short-duration space that emphasizes structured products and targets a total return materially higher than the benchmark while seeking to maintain a higher average credit quality than a typical corporate focused, short duration strategy. This Fund is an option for those clients looking for additional yield in a low-rate environment.”
The Diamond Hill Short Duration Total Return Fund will primarily focus on investing in a diversified portfolio of investment grade fixed income securities and may invest a significant portion or all of its assets in asset-backed, mortgage-related, and mortgage-backed securities. The Fund will typically maintain an average portfolio duration of less than three.
The Diamond Hill Core Bond Fund will primarily focus on investing in a diversified portfolio of investment grade fixed income securities and may invest a significant portion in mortgage-
related and mortgage-backed securities. The Fund will typically maintain an average portfolio duration within 10% of the duration of the Bloomberg Barclays U.S. Aggregate Index.
The Short Duration Total Return and Core Bond Funds are currently available through Charles Schwab, TD Ameritrade and SEI. We expect them to be available soon on additional intermediary platforms.
Chris Bingaman, CEO and Portfolio Manager, Diamond Hill, said “Henry and Mark have added a new dimension to our investment team and the extension of our fixed income strategies will allow us to better serve our clients.”
|Diamond Hill Fixed Income Strategies|
|Short Duration Total Return||Core Bond||Corporate Credit||High Yield|
|Portfolio Managers||Henry Song
|Process||Bottom-up security selection|
|Execution||Portfolio managers engage directly with the market, executing all trades|
|Investment Objective||Maximize total return consistent with the preservation of capital.||Maximize total return consistent with the preservation of capital.||High current income, preservation of capital and total return over a
five-year time horizon.
|High current income with the opportunity for capital appreciation.|
|Sector Focus||Structured Product||Diversified Core||Corporate bonds, 10% limit on CCC||High Yield corporate bonds|
|Benchmark||Bloomberg Barclays U.S. 1-3 Year Gov./Credit||Bloomberg Barclays U.S. Aggregate||BofA ML U.S. Corporate & High Yield||BofA ML U.S. High Yield|
|Mutual Fund Tickers||Class A: DHEAX
Class I: DHEIX
Class Y: DHEYX
|Class A: DHRAX
Class I: DHRIX
Class Y: DHRYX
|Class A: DSIAX
Class I: DHSTX
Class Y: DSIYX
|Class A: DHHAX
Class I: DHHIX
Class Y: DHHYX
About Diamond Hill:
We are an independent investment management firm with significant employee ownership and $18.2 billion in assets under management as of August 31, 2016. We provide investment management services to institutions and individuals through mutual funds, institutional separate accounts, exchange traded funds, and private investment funds. Our entire investment team shares the same intrinsic value investment philosophy, and our interests are firmly aligned with our clients through significant investment in our strategies. For more information, visit www.diamond-hill.com
Risk Disclosure: The value of fixed-income securities varies inversely with interest rates; that is, as interest rates rise, the market value of fixed-income securities will decline. Lower quality debt (i.e.: “High Yield”) securities involve greater risk of default or price changes due to potential changes in the issuer’s credit quality. The value of investments in mortgage-related and asset-backed securities will be influenced by the factors affecting the housing market and the assets underlying such securities. The securities may decline in value, face valuation difficulties, become more volatile and/or become illiquid. They are also subject to prepayment risk, which occurs when mortgage holders refinance or otherwise repay their loans sooner than expected, creating an early return of principal to holders of the loans.
The Bloomberg Barclays U.S. 1-3 Year Government/Credit Index is an unmanaged index of investment grade government and corporate bonds with maturities of one to three years. The Bloomberg Barclays U.S. Aggregate Index is an unmanaged index representing U.S. investment grade fixed rate bond market, with index components for government and corporate securities, mortgage pass-through, and asset-backed securities. The Bank of America Merrill Lynch U.S. Corporate & High Yield Index is comprised of U.S. dollar denominated investment grade and below investment grade corporate debt publicly issued in the U.S. domestic market. The Bank of America Merrill Lynch U.S. High Yield Index tracks the performance of U.S. dollar denominated below investment grade corporate debt publicly issued in the U.S. domestic market.
An investor should consider the Fund’s investment objectives, risks, and charges and expenses carefully before investing or sending any money. This and other information about the Fund can be found in the Fund’s prospectus or summary prospectus which can be obtained at www.diamond-hill.com or by calling 888- 226-5595. Please read the prospectus or summary prospectus carefully before investing. The Diamond Hill Funds are distributed by BHIL Distributors, LLC (Member FINRA/SIPC). Diamond Hill CapitalManagement, Inc., a registered investment adviser, serves as Investment Adviser to the Diamond Hill Funds and is paid a fee for its services. Diamond Hill Funds are not FDIC insured, may lose value, and have no bank guarantee.
Investment Grade is a Bond Quality Rating of AAA, AA, A or BBB. Security quality ratings are derived from underlying portfolio securities as rated by Standard & Poor’s. For securities that are not rated by Standard & Poor’s, but are rated by Moody’s, the Moody’s rating will be used. Diamond Hill does not calculate a rating for securities that are not rated by Standard & Poor’s or Moody’s. The Standard & Poor’s and Moody’s ratings represent an opinion only, not a recommendation to buy or sell. Unrated securities by both Standard & Poor’s and Moody’s will show in the “NR” or “Not Rated” category. CCC credit exposure includes the ratings CCC+, CCC, CCC- by Standard & Poor’s; Caa1, Caa2, Caa3 by Moody’s; and CCC by Fitch. Duration measures the interest rate risk of the Fund. It is an estimate of the approximate percentage change in the Fund’s net asset value resulting from a one percentage point change in yield.
Duration measures the interest rate risk of the Fund. It is an estimate of the approximate percentage change in the Fund’s net asset value resulting from a one percentage point change in yield.