High Yield Strategy
The strategy is appropriate for investors seeking diversification and the potential rewards associated with investing in high-yield, fixed income securities. The subadviser uses an investment process that focuses on adding value through issue selection, sector/industry selection and opportunistic trading. The strategy will generally overweight sectors and industries with well-valued companies whose business profiles are viewed to be improving.
Debt securities are subject to various risks, the most prominent of which are credit and interest rate risk. The issuer of a security may fail to make payments in a timely manner. Values of debt securities may rise and fall in response to changes in interest rates. This risk may be enhanced with longer-term maturities.
There is a greater level of credit risk and price volatility involved with high yield securities than investment grade securities.
Investing internationally, especially in emerging markets, involves additional risks such as currency, political, accounting, economic, and market risk.
A fund that focuses its investments in a particular industry or sector will be more sensitive to conditions that affect that industry or sector than a non-concentrated fund.