Long View interview with Mary Ellen Stanek, Baird Funds [privately held] - click on the Transcript tab to read. https://www.morningstar.com/podcasts/the-long-view/62
Describes operations during March bond crash with remote operations - handling liquidity, risk mitigation, fund flows, taking advantage of opportunities created by forced selling by leveraged players. Unprecedented economic environment - shutdowns, reopening, huge monetary and fiscal stimulus. Rates and inflation would remain low longer. Businesses are handling challenges differently and the firm is taking cautious approach to credit analyses. Credit exposure was increased as quality bonds went on sale. There was huge corporate bond issuance in March - May at attractive spreads. On the hindsight, the firm should have increased credit exposure even more but it did what seemed appropriate in real-time and the window of opportunity turned out to be short. Funds did take hits [NAVs, outflows] in March but rebounded after - firm monitors performance relative to benchmarks as well as peers. Funds keep duration close to benchmarks, so are rate/duration neutral in that respect [relatively, not absolutely]; many of firm's clients are in healthcare or pension funds that find this rate approach suitable. She describes the approach as passive-active, i.e. passive on rate/duration [relative to benchmarks] but active on the credit side. Fund holders decide on their rate/duration exposure based on with fund(s) they hold and the firm manages mostly the credit side but also the yield-curve positioning [i.e. how duration are achieved]. Firm doesn't use derivatives or leverage - funds are just portfolios of bonds, plain and simple. Bond investing is game of inches or singles, not home runs. She says that bond-ballast view is OK if one can call the rates and/or equity selloffs correctly in advance, but that mostly misses opportunities longer-term and that insurance against occasional equity declines is costly. She cites her funds' net positive long-term performance over their benchmarks [i.e. net spread-performance]. Muni market should be quiet and sleepy but it is/was anything but that and muni funds took advantage of dislocations - in fact, opportunities were such that some munis were added to ultra-short- and short- term taxable funds. The firm has a very flat management structure and that allows discussion of a wide variety of ideas. Firm exploits new technology but has kept bond management simple. Institutional classes have low ERs comparable to what one may find for separate-accounts; Investor classes have slightly higher ERs.
I note she was rather silent on the Fed Reserve coming to the rescue, buying or under-girding much of Baird's bond portfolio holdings, resulting in the upward rebound performance last three months.