Introduction to Kris Konrad and Piton Investment Management

Introducing Piton Investment Management's Structured Notes Resource Center.

With the launch of Piton Investment Management's Structured Notes Strategy, we're excited to introduce our comprehensive Structured Notes Resource Center!

he first in our educational video series introduces the visionary leader behind this strategy. Meet Kristopher Konrad, Founding Partner at Piton Investment Management, as he shares his remarkable journey in the fixed income space. Let's dive in.

Q1. Can you tell us about your professional background and journey that led you to the world of fixed income and structured products? What motivated you to become a founding partner at Piton Investment Management?

I started my career in the mid-90s at a startup mortgage REIT called Annaly Mortgage Management. Annaly specializes in managing a portfolio of agency MBS — agency mortgage-backed securities that were all guaranteed by the US government. I was the seventh person hired into the company immediately following their IPO, and within a couple of years, I was given the opportunity to take over the day-to-day management of the company's portfolio. With our returns, we were able to attract large amounts of capital over the years and grow that portfolio from $2.5 billion in assets in the late 90s to over $140 billion at its peak after the Great Financial Crisis. Still to this day, it was the largest publicly traded agency MBS portfolio outside of the GSEs, so outside of Fannie and Freddie, before they were taken into conservatorship during the crisis. After retiring from Annaly in 2014 and after taking a little downtime, I decided I wanted to start something new with some of my old colleagues. I was still fairly young, and I wanted to try to create another success story.

Professional Background and Journey

• Career growth at Annaly Mortgage Management (mid-1990s to 2014)

• Portfolio management expansion from $2.5B to $140B

• Creation of the largest public agency MBS portfolio outside GSEs

• Transition to founding Piton with former colleagues

Q2. What market gaps or opportunities did you identify that inspired the creation of Piton?

We launched our fixed income SMA business in 2018, primarily to cater to the growing transition in the wealth management business, specifically for ultra-high-net-worth clients. Large teams and books of business were leaving the big wirehouses in droves to go independent, and as they did, they were leaving behind institutional fixed income desks and the capability to provide bespoke fixed income management for the larger clients. The platform we created at Piton was specifically designed to fill this void. We were able to present a team with extensive fixed income management experience to support these independent RIAs at a very attractive price point, and I'll say seven years later, this opportunity is still as big now as it was then.

Market Gaps and Opportunities

• Wealth management transition of ultra-high net worth clients

• Exodus of teams from wirehouses to independent models

• Need for institutional fixed income expertise for independent RIAs

• Sustained market opportunity seven years after launch

Q3. How has your previous experience shaped your approach to investment management at Piton?

Being a large institutional player, especially as a public company, is a whole different level of scrutiny and pressure. To effectively run and manage a portfolio as big as the one we had during my days at Annaly, that required constant attention to detail in every facet of the business, especially on the asset management side. To be successful, you had to be forward-thinking and be able to sift through all the challenging market dynamics to make the right investment decisions for your shareholders or in the case now, for our clients. This is the same approach we bring to every one of our clients at Piton, from the biggest to the smallest, every day.

How Previous Experience Shapes Current Approach

• Institutional-level scrutiny and discipline are applied to all clients

• Forward-thinking investment approach from public company experience

• Attention to detail in portfolio management across all asset sizes

• Transfer of institutional expertise to private client relationships