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| Quarter | Letter Date | Fund Name | QTD | YTD | Tickers | Themes | Quick Take |
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Buyside Digest is not affiliated with, and does not endorse, Brandes Core Plus Fixed Income Fund. This analysis is provided for institutional research purposes only and is not investment advice.
"Brandes Core Plus Fixed Income outperformed in Q2 2026 through disciplined security selection, led by Sabre Global as travel sector headwinds eased. The manager views corporate credit spreads at 30-year tights as complacent despite record issuance, maintaining a defensive posture with shorter duration, meaningful Treasury holdings for opportunistic deployment, and emphasis on bottom-up fundamental analysis to navigate historically tight valuations."
The Brandes Core Plus Fixed Income Fund returned 0.94% in Q2 2026, outperforming its benchmark as the Bloomberg U.S. Aggregate Bond Index rose 0.67%. The quarter saw Federal Reserve policy expectations shift from anticipated rate cuts to potential rate increases by year-end, driven by consistently stronger-than-expected economic data. Security selection drove outperformance, particularly Sabre Global, which benefited as macro headwinds from government shutdowns and energy price volatility faded while the company executed on technology improvements and market share gains. The manager views the current fixed income market as complacent, with corporate bond yield spreads at 30-year tights despite record issuance exceeding $1 trillion by mid-May. While absolute yields are attractive, credit risk compensation is historically low. The Fund maintains a defensive posture with duration 6% shorter than benchmark, favors shorter-maturity corporates with strong asset coverage, holds a meaningful Treasury allocation for opportunistic redeployment, and remains underweight agency mortgage-backed securities. The manager emphasizes patience and rigorous security selection as essential in this environment.
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