Damien McCann, a fixed income portfolio manager at Capital Group with 24 years of experience, shares his unconventional investment strategies. He discusses transitioning from equity analysis to fixed income and the benefits of a multi-sector income strategy that aims for steady returns of about 6.5% to 7%. Damien reflects on navigating market risks and lessons from the global financial crisis, emphasizing the importance of a diversified portfolio. He also shares a personal story from his bowling days, showcasing the passion that fuels his professional journey.
Damian McCann's unique job application strategy underscores the value of innovative thinking and standing out in a competitive market.
The multi-sector income strategy he developed emphasizes the importance of diversification and adaptability in navigating volatile investment environments.
Deep dives
Creative Job Hunting Strategies
After struggling to secure a job with a traditional resume, Damian McCann, a fixed income portfolio manager, decided to take a unique approach by creating a CD portfolio that mimicked the promotional CDs of the late 90s. This creative strategy garnered him multiple interviews, including one at Capital Group, where he embarked on his investment career. His journey illustrates the importance of standing out in a competitive job market and the value of innovative thinking in overcoming obstacles. This experience not only shaped his career path but also highlighted how resourcefulness can lead to significant opportunities.
Transitioning from Equities to Fixed Income
Damian's transition from an equity research associate to a fixed income portfolio manager was largely influenced by the business needs of Capital Group and an encouraging mentor. Initially uncertain about the bond market, he decided to embrace the change, trusting the guidance of his mentor who believed his experience in equity analysis would be beneficial. This shift allowed him to approach fixed income investing with a unique perspective, merging his understanding of company balance sheets with bond investment strategies. Consequently, his equity background informs his fixed income decisions, allowing him to identify potential risks and opportunities in capital structure.
Innovative Multi-Sector Income Strategy
Damian discusses the conceptualization and evolution of the multi-sector income strategy, which aims to provide elevated income without taking excessive risks. He emphasizes the importance of diversifying across multiple sectors to create a more resilient income stream, focusing on high-yield corporates, investment-grade corporates, emerging market debt, and securitized credit. The strategy enables portfolio managers to adjust allocations based on current market conditions, allowing for flexible management and response to valuation opportunities. This approach aims to meet the income needs of investors while maintaining a commitment to risk management, especially in volatile market environments.
Lessons from the Global Financial Crisis
Experiencing the global financial crisis as a relatively new analyst provided Damian with crucial lessons on the significance of diversification and risk management in investing. During this tumultuous period, he realized the pitfalls of focusing too heavily on lower-rated companies without balancing exposure to higher-quality options. His experiences underscored the necessity of being adaptable and prepared to take advantage of investment opportunities that arise in crisis situations. Ultimately, these lessons have shaped his investment philosophy, emphasizing the need for a well-rounded approach that considers both risks and potential rewards.
When it comes to investing in bonds for income, what’s the best combination? Damien McCann, a fixed income portfolio manager at Capital Group, talks with Mike Gitlin about how he approaches investing across corporate investment-grade and high-yield bonds, emerging markets debt and securitized credit. Damien also shares his unconventional path to working at Capital Group. If you want more insights on differentiated multi-sector investing and how our bond managers navigate risky environments, this episode is for you. #CapGroupGlobal
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