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Northern Trust Asset Management, one of the world’s leading investment managers, has this month launched its Sterling Ultra-Short ESG strategy, expanding its cash segmentation suite to cater to the varying investment horizons for investors, whilst incorporating Environmental, Social and Governance factors.
The strategy is designed to align with investors’ specific risk, return and liquidity needs and aligns with Northern Trust Asset Management’s belief that investors should be compensated for the risks they take.
"We are pleased to expand our range of solutions to better support investors’ income and liquidity requirements," said Peter Yi, head of global short duration portfolio management at Northern Trust Asset Management. "As investors continue to face a ‘lower for longer’ interest rate environment, they may struggle to generate sufficient yield without increasing duration. Over the past 20 years, we’ve seen ultra-short bonds outperform money markets each calendar year (on average) and we believe combining the ultra-short duration with Environment, Social, Governance factors can create a compelling opportunity for investors."
The strategy, open to investors globally subject to local distribution rules, will enable investment in securities with a target duration of one year and a maximum maturity of five years. The strategy supports "strategic" cash with longer term spending needs, and as part of a cash segmentation approach, can be complemented by the Northern Trust Sterling Conservative Ultra-Short ESG strategy for "reserve" cash with intermediate or uncertain spending needs with a three to nine month horizon, and the Sterling Money Market Strategy for "operational" cash for day to day spending needs.
"Northern Trust Asset Management understands that when it comes to cash one size doesn’t fit all," said Marie Dzanis, head of Northern Trust Asset Management, EMEA. "We see continued demand from investors for sustainable investing solutions, in addition to the requirement to generate alpha. Combining sustainable investing and bond portfolios can provide a desirable outcome, because both focus on risk management. We have seen that bonds issued by companies with favorable ESG ratings tend to trade at tighter credit spreads for longer periods of time and can offer downside mitigation during periods of market turbulence."
Northern Trust Asset Management is a global leader in liquidity strategies with more than 40 years of experience. It is the fourth largest cash manager for external clients in Europe (as of December 31, 2019 according to IPE’s Top 500 Asset Managers 2020 survey). The asset manager’s liquidity strategies manage cash along the liquidity spectrum of investor needs — from operational to reserve to longer-term, strategic uses of cash. Its deep global expertise in rates, credit and risk management — together with its global scale — can help clients navigate changing economic landscapes.
About Northern Trust Asset Management
Northern Trust Asset Management is a global investment manager that helps investors navigate changing market environments, so they can confidently realize their long-term objectives. Entrusted with US$1.1 trillion of investor assets as of December 31, 2020, we understand that investing ultimately serves a greater purpose and believe investors should be compensated for the risks they take — in all market environments and any investment strategy. That’s why we combine robust capital markets research, expert portfolio construction and comprehensive risk management to craft innovative and efficient solutions that deliver targeted investment outcomes. As engaged contributors to our communities, we consider it a great privilege to serve our investors and our communities with integrity, respect, and transparency.
Northern Trust Asset Management is composed of Northern Trust Investments, Inc., Northern Trust Global Investments Limited, Northern Trust Fund Managers (Ireland) Limited, Northern Trust Global Investments Japan, K.K., NT Global Advisors, Inc., 50 South Capital Advisors, LLC, Belvedere Advisors LLC and investment personnel of The Northern Trust Company of Hong Kong Limited and The Northern Trust Company.
About Northern Trust
Northern Trust Corporation (Nasdaq: NTRS) is a leading provider of wealth management, asset servicing, asset management and banking to corporations, institutions, affluent families and individuals. Founded in Chicago in 1889, Northern Trust has a global presence with offices in 22 U.S. states and Washington, D.C., and across 22 locations in Canada, Europe, the Middle East and the Asia-Pacific region. As of December 31, 2020, Northern Trust had assets under custody/administration of US$14.5 trillion, and assets under management of US$1.4 trillion. For more than 130 years, Northern Trust has earned distinction as an industry leader for exceptional service, financial expertise, integrity and innovation. Please visit our website or follow us on Twitter.
Northern Trust Corporation, Head Office: 50 South La Salle Street, Chicago, Illinois 60603 U.S.A., incorporated with limited liability in the U.S. Please read our global and regulatory information.
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