Conservative ABCP investor Mason Street Advisor, which prefers multiseller programs with the occasional auto loan ABS-backed single-seller programs, is stepping up its participation in those programs.
The Milwaukee-based asset management firm is the investment advisor for Northwestern Mutual. It manages more than $69 billion in assets and invests in mortgage- and asset-backed securities through its Select Bond Fund, which had net assets of $132.5 million by March 31, 2006. The company currently invests in about 13, mainly multiseller ABCP programs, but is looking to increase that to about 20 in 2007, said sources familiar with the company.
That move appears to reflect an increasing interest in MBS and ABS, even if its investment preferences remain conservative. During the fiscal year that ended last March, the fund decreased its weightings in corporate bonds and boosted its weightings in MBS and ABS, according to its annual report. By the end of Mason Street Advisor's fiscal year, the Select Bond Fund had 46% of its assets in structured products; 22% in government securities; 30% in corporate bonds and 2% in short-term investments and other assets.
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