The Eaton Vance Short Duration Diversified Income Fund (NYSE: EVG) is a closed-end management investment company designed to seek high current income while maintaining a shorter duration profile to help mitigate interest rate risk. Managed by the fixed income team at Eaton Vance Advisers, EVG pursues a multi-sector, actively managed strategy that emphasizes diversification across credit, collateral types and geographic regions. The fund’s flexible mandate allows the portfolio managers to allocate among floating-rate bank loans, investment-grade corporate bonds, asset-backed and mortgage-backed securities, emerging market debt and other short-term income instruments.
In constructing the portfolio, EVG’s management team seeks to balance yield and risk by dynamically adjusting sector exposures in response to changing market conditions. The fund typically maintains a weighted average coupon and aims for a duration that is below the broad US investment-grade bond market. This approach is intended to dampen volatility during periods of rising interest rates while capturing income opportunities in both developed and selected emerging markets. Active credit research, rigorous risk monitoring and scenario analysis are core elements of the fund’s investment process.
Originally launched by Eaton Vance in the mid-2010s, EVG benefits from nearly a century of fixed income expertise at Eaton Vance, which was founded in 1924. In 2020, Eaton Vance was acquired by Morgan Stanley, expanding the distribution capabilities and global research network available to the fund. EVG is overseen by a team of seasoned portfolio managers and credit analysts who draw on the resources of Morgan Stanley Investment Management’s broader fixed income platform. Key members of the management team bring decades of experience in managing short-duration and multi-sector bond portfolios.
EVG primarily serves individual and institutional investors seeking regular income with lower interest rate sensitivity than conventional bond funds. Shares of the fund trade on the New York Stock Exchange, providing investors with liquidity and transparency in pricing. Through its diversified, short-duration strategy and experienced management, the Eaton Vance Short Duration Diversified Income Fund aims to deliver consistent income generation and capital preservation in a variety of interest rate environments.
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