Ladder

Avoid surprises thanks to this disciplined approach to municipal investment.

Do you seek a well-balanced municipal bond portfolio with extremely high credit quality that aims to provide consistent income? If so, consider our Ladder strategy, which offers a traditional investment option targeting predictable maturities that are typically equally weighted across the yield curve. In addition, our Ladder portfolios afford investors a certain degree of liquidity, as well as attractive fees below industry standards.

Continue exploring this page to find out more about the investor traits that are best suited for Gurtin’s Ladder strategy. You can also view strategy features, detailed performance statistics, downloadable fact sheets, and responses to common questions about our Ladder portfolios.

Investor Profile

Suitable for Clients Focused on Stable Income and Low Fees

Ladder Features

When Peace of Mind Is Paramount

Our Municipal Ladder strategy* is generally well suited for investors with a neutral view on potential interest-rate fluctuations. In this strategy, our goal is to provide a consistent level of income through an even distribution of maturities across your Ladder.

To help achieve this objective, we use proprietary technology to: 1) calculate daily all outstanding portfolio needs, 2) scour the de-centralized $3.9 trillion municipal bond market to identify available bonds that will satisfy these portfolio needs, and 3) systematically allocate the appropriate bonds across eligible portfolios in an equitable manner.

In this way, we are able to offer management fees that are competitive with low-fee mutual funds. In addition, you can reach fee breakpoints faster because we aggregate municipal assets within advisory firm relationships. Finally, we can customize portfolios managed under our Ladder strategy to meet clients’ tax profile, income, investment horizon, and liquidity needs, so you can rest assured you’re providing clients with a portfolio that’s tailored to their unique investment requirements.

 

*As of April 1, 2018, the Municipal Intermediate-Term, Municipal Limited-Term, Municipal Short-Term, and Municipal Ultra Short-Term Composites have been renamed the Municipal Ladder - Intermediate, Municipal Ladder - Limited, Municipal Ladder - Short, and Municipal Ladder - Ultra Short Composites, respectively.

Ladder Key Statistics

Key Statistics
 
Quality

Ready to Get Started?

If the Ladder strategy objectives and performance data align with your client’s investment objectives, we invite you to take the next step and request a portfolio review, so our Advisory Services team can open a new account for your client as soon as possible:
OR
If the objectives of the Ladder strategy do not match your municipal investment goals, please complete a quick questionnaire, which will allow us to help you find the strategy that is right for you:

Frequently Asked Questions

Have Questions? We Have Answers.


CAN LADDERS BE CUSTOMIZED BY STATE?

You can choose from the following 14 state-specific options for portfolios managed under our Ladder strategy: CA, CO, MA, MD, MI, MN, MO, NC, NY, OH, OR, SC, UT, and VA. In consideration of clients’ best interests, we only purchase bonds with high-quality credit profiles that adhere to our strategy objectives. For this reason, certain state-specific options may not be available if there is a lack of availability of attractive bonds that fit our investment criteria for this strategy. In cases like these, a broader national focus may be more appropriate.


CAN I CHOOSE MY OWN MATURITY RANGE?

Yes, we invite you to choose a target maturity range for municipal bonds held in your Ladder portfolio, based on your clients’ investment time horizon and/or liquidity needs. We will then ladder the bonds in your portfolio within that range. You can choose from the following maturity term ranges:

  • 0-18 months (ultra-short term)
  • 0-3 years (short term)
  • 0-5 years (limited term)
  • 0-10 years (intermediate term)

HOW CAN I HAVE A SAY IN THE GENERATED LEVEL OF INCOME?

The targeted maturity range you choose for your Ladder portfolio can affect the level of income that your portfolio will generate. Longer-term portfolios generally generate higher levels of income, but the trade off is increased price volatility. The market rewards you with higher yield to compensate for the assumed price risk. For this reason, you can target a certain level of generated income by choosing a maturity range for the bonds held in your portfolio. For example, if you opt for a longer- rather than shorter-term portfolio, you can expect a higher level of yield (and, thus, overall income).


CAN I EXPECT TO BE FULLY INVESTED IN THIS STRATEGY QUICKLY?

Yes, our team aims to fully invest portfolios managed under the Ladder strategy within 30 days of account inception.


DO YOU ACTIVELY MANAGE PORTFOLIOS UNDER THIS STRATEGY?

While we are always actively managing credit quality, we do take a more passive approach to the management of our Ladder portfolios, in that we don’t intentionally overweight one portion of the ladder over another. In regard to the particular objectives of the Ladder strategy — to provide a consistent level of income with low volatility through equally weighted maturities that helps investors rest easily — we have not seen any evidence to suggest that targeting bonds in a particular portion of the yield curve necessarily leads to higher returns over the life of bonds managed under this strategy, and we believe that doing so works in opposition to a ladder’s objective.

We do offer other strategies with slightly higher volatility mandates that may employ a different investment approach in order to capture above-market returns. Please compare strategies for more information about these other options.


HOW ARE YOU ABLE TO OFFER RELATIVELY LOW FEES FOR LADDER PORTFOLIO MANAGEMENT?

The primary reason we are able to offer fees below industry standards is that we utilize proprietary technology we developed in house to calculate the investment needs of every portfolio we manage, every day. With our innovative tools, our portfolio management team can see exactly which portfolios need which types of bonds and can then compare those needs to available offerings in the market, quickly and efficiently. Thanks to our suite of state-of-the-art technology, our consistent distribution of maturities, and the low-volatility nature of this strategy, we are able to offer fees that rival those of low-fee mutual funds.


WHAT LEVEL OF RETURNS/INCOME SHOULD I EXPECT?

Because the primary objective of this strategy is to provide a predictable level of returns/income that’s in line with the market, you can expect returns that are similar to the benchmark that most closely matches the structure you have chosen for your Ladder portfolio.

The following benchmarks correspond to the related target maturity range, namely:

  • Ultra-short term: Bank of America Merrill Lynch (BAML) 6-12 Month U.S. Municipal Securities Index
  • Short term: BAML 1-2 Year U.S. Municipal Securities Index
  • Limited term: BAML 1-5 Year U.S. Municipal Securities Index
  • Intermediate term: BAML 1-10 Year U.S. Municipal Securities Index

CAN I FUND A PORTFOLIO WITH EXISTING SECURITIES?

In most cases, yes, we can use currently held municipal securities to fund a portfolio. If you wish to transition a portfolio managed under a different strategy into the Ladder strategy, please request a portfolio review by clicking the “Get Started” button below.


READY TO GET STARTED?
To learn more about how we can customize portfolios to meet investors' specific investment objectives, please contact our Advisory Services team by calling (858) 436-2200 or by emailing AdvisoryServices@gurtin.com.