Investment Strategies Overview

KDP DEFENSIVE HIGH YIELD

High Yield Bonds

KDP's Defensive High Yield strategy over the past 14 years has sought to provide a high level of current income, with a strong emphasis on principal preservation, by investing in better-quality US Dollar denominated high yield bonds and employing an investment approach focusing on fundamental analysis and active risk management. This strategy seeks to invest in companies, sectors and levels of the corporate debt structure where our analysts and investment managers see relative value and that the portfolio is being compensated sufficiently for the level of risk undertaken. All of these decisions are driven by KDP's Default Risk Ranking methodology.

KDP CREDIT STRATEGY

High Yield Bonds and Loans

The Strategy’s objective since 2007 has been to obtain attractive annual returns over the long term through a blend of income and capital appreciation by allocating between defensive high yield bonds and senior/secured floating rate loans. KDP believes that this strategy allows for the flexibility to move into what it assesses to be the optimum asset allocation depending on the prevailing environment.

KDP CREDIT STRATEGY LOAN ALLOCATION

Loans

The KDP Credit Strategy Loan Allocation, part of KDP's multi-asset KDP Credit Strategy, actively manages senior secured, floating rate loans applying the credit discipline of KDP's industry and market analysts and relying on the experience of our seasoned portfolio management team. The KDP Credit Strategy Loan Allocation seeks to provide a high level of current income with emphasis on principal preservation by investing in better-quality (target weighting of Ba3/BB-) high yield loans. The strategy seeks to produce superior long-term performance with low volatility.