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Principal Global Investors offers specialized expertise in the management of high yield fixed income through our affiliate, Post Advisory Group, LLC ("Post"). With $13.1 billion in assets under management,* as of September 30, 2008, Post is a leading manager of high yield fixed income and related alternative investments. The firm's predecessor, Post Advisory Group, Inc., was founded in 1992 by Larry Post and is based in Los Angeles. Its clients include a wide range of public and private retirement funds, corporations, endowments, foundations and high net worth individuals. Post believes the fixed income market in general, and the high yield market in particular, is a continuum. Accordingly, Post believes opportunities exist through all market environments and cycles. The firm's investment capabilities include a full spectrum of product offerings ranging from traditional high yield to distressed debt and long/short portfolios. Traditional high yield securities are considered the safest in the high yield universe with the lowest credit risk. The typical average credit rating is BB to B+. Stressed and distressed debt, or opportunistic securities, includes bank loans, corporate bonds, convertible securities and special situations. For each of its capabilities, Post applies a consistent investment philosophy. This philosophy is based on the belief that superior performance is achieved by identifying three specific attributes: (1) value identification, (2) downside protection, and (3) risk diversification. In value identification, Post's experienced investment team concentrates on complex, under followed and misunderstood credits, which have the highest probability of being mispriced by the consensus view. Another cornerstone is downside protection based on qualitative analysis. The third cornerstone is portfolio diversification by issue, issuer, security type, duration, maturity and credit rating. The disciplined process used to implement this philosophy has been enhanced and refined over the past 30 years to meet changing capital market conditions. Post has experience navigating through both up and down market cycles, which Post believes provides a competitive advantage in analyzing the potential downside risk of each investment. Principal Global Investors is a diversified asset management organization and a member of the Principal Financial Group®. We manage $228.0 billion* in assets primarily for retirement plans and other institutional clients. Our investment capabilities encompass an extensive range of equity, fixed income and real estate investments as well as specialized overlay and advisory services.
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