10 Questions With Tom Atteberry

Morningstar magazine managing editor Rob Wherry recently interviewed Tom Atteberry, manager of

1. How did you become a fixed-income portfolio manager?

I joined

2. Your fund has been described as "ultraconservative" and a "safe haven." Do you agree? The fixed-income environment for the past 13 years has meant that given our approach of striving for an absolute positive return in a 12-month period, our value investing philosophy, and our desire for each investment having a margin of safety, the fund has taken on those conservative characteristics. It is not that we are risk-averse; we want to be adequately paid for the risks we undertake.

3. What concerns you the most at the moment? More radical and untried policies by central bankers designed to promote more debt by society. For some reason, central bankers fail to understand the downside of debt.

4. What is your assessment of fixed-income exchange-traded funds? Quantitative easing has pushed money into risk assets. The result is the capital markets have turned into a momentum trade. Low rates have disguised the good quality from the average- or poor-quality investment. This favors ETFs. When the capital markets turn down, active management will have its opportunity.

5. Where are you finding your best ideas? After eight years of zero interest-rate policy and QE with substandard economic growth, there are little if any "best" ideas. It is more of finding ideas that in either a rising interest-rate environment or falling rates due to deflation and slower growth, one can survive with their capital intact. For us, that leads to lending money on assets critical to an individual or business with maturity of five years or less.

6. What app on your phone do you use the most? Office email.

7. Does your Los Angeles location give you an advantage? It is away from the group-think that can occur in New York. The three-hour time difference is great, as starting about 2 p.m. the phones go quiet and you have a great opportunity to just sit and think without interruption.

8. Who is the one regulator you have to pay attention to? Mario Draghi, president of the European Central Bank, and Haruhiko Kuroda, governor of the Bank of Japan. Both think negative interest-rate policies and quantitative easing will solve their respective economies' growth problems. Using heavy doses of these two untried monetary policy tools is dangerous for savers around the world.

9. You went to school in Texas. Is there anything you miss about the Lone Star State? Texans have that entrepreneurial spirit, pioneer drive, and optimism that, at times, I find lacking in other parts of the country. They are also some of the friendliest people in the country.

10. What is your best trick for getting through an airport quickly? Never check bags, travel light--if you cannot fit it in a carry-on bag, it's not essential.

This article originally appeared in the August/September 2016 issue of Morningstar magazine. To subscribe, please call 1-800-384-4000.