Where this Morningstar top-rated female fund manager is putting money to work

Janet Rilling’s path to success started with her first investment as a teenager.

Today the Wisconsin native, a senior portfolio manager and head of the plus fixed income team at Allspring Global Investments, is among the top female fund managers named at Morningstar.

Rilling’s interest in finance was spurred by her father.

“He did personal investing and around the dinner table, we’d have conversations,” Rilling said.

She opened her first certificate of deposit when she was 16 and bought her first mutual fund in an individual retirement account while at college.

Rilling now has 30 years of fixed-income experience under her belt, to go along with a masters in finance from the University of Wisconsin and CPA and CFA designations. Working out of Allspring’s Milwaukee office, Rilling stands out not just because of what Morningstar calls her “impressive career,” but because she is still in the minority when it comes to gender. Only 18% of portfolio managers and 26% of analysts are filled by women, a recent Morningstar survey found.

“I find this industry to be so compelling to be a part of, and I think women can bring a lot to it and also get a lot out of it,” Rilling said. “So it has been surprising to me that during my time in this industry, those numbers haven’t moved a lot.”

Putting her investment strategy to work

These days, she is finding plenty of opportunities in fixed income, noting that yields are providing attractive payouts.

“The beauty of that income is it’s a cushion. So in the event that rates do move up from here, you do have some income that can help offset that,” she said. “That’s what gives us more confidence to be more constructive on fixed income in this environment.”

As head of the plus fixed income team, Rilling manages 23 investment professionals. She is also a manager of the Allspring Core Plus Bond fund, which gets four stars at Morningstar. The fund has a 4.29% 30-day SEC yield and 0.81% gross expense ratio.

It is in the top quartile in its category for trailing 5-, 10- and 15-year returns, according to Morningstar. However, its performance so far this year lands it in the third quartile.

“The team plies a sound and well-structured approach that uses qualitative views to adjust quantitative outputs,” Morningstar senior analyst Mike Mulach wrote in May.

The fund tilts towards high-quality income. Rilling said the process is very collaborative, with individuals bringing their unique views to the table. Her focus is on the investment-grade portion of the portfolio.

“As a group, we talk across all the sectors and, as a team, we set our targets for allocating to the sectors,” she said.

The “core” part of the fund makes up at least 65% of the portfolio and is allocated to sectors within the Bloomberg US Aggregate Bond Index. That includes Treasurys, agency mortgage-backed securities, investment-grade corporate bonds and structured products.

Up to 35% is in the “plus” part of the fund. That includes U.S. high yield, emerging market debt and European credit.

“We think about casting a wide net there,” Rilling said. “We want to use a lot of the different global fixed-income sectors within the plus piece, because we think that leads to a more diversified source of alpha and can help us with having a more consistent return profile.”

These days, the “plus” allocations make up just about 12% of the fund because valuations look rich, she said.

“No one sector screens as especially cheap, but we think the incremental yield across them is worth having an allocation,” she said.

Some 3.3% is in U.S. high-yield bonds and 2.3% is in emerging markets. About 2% is in European investment-grade credit and 2.6% in European high-yield.

The firm also launched an exchange-traded fund version of the strategy, Allspring Core Plus ETF (APLU), in December. It has a 4.74% 30-day SEC yield and a 0.30% expense ratio.

Where she sees opportunity

These days, Rilling favors a number of different structured products, including agency mortgage-backed securities .

“If you look at valuations over the last cycle, they’re a little more middle of the range compared to investment grade credit, which is near the tightest it’s been during this last historical period,” she said. “We think there are some supply/demand dynamics that also offer support to the asset class as we move through 2025.”

She also likes asset-backed securities, including some “plain vanilla” exposures like credit-card-backed and auto deals. In addition, “esoteric” — or less standard — holdings can also be attractive right now, she said.

“They are things like data centers, loans to franchisees … just a range of exposures that are consumer-related or business-related,” Rilling said. “We like the fundamentals of that part of the market, and we think compensation is good.”

The fund also has a modest allocation to commercial mortgage-backed securities. While they may be controversial to some because of issues in the office market, the sector has more to offer, such as retail and hospitality properties, she said.

“We’ve been opportunistic where we think things have been the baby thrown out with the bathwater,” Rilling said. “We have picked up some individual securities that we think offer better value than what we’re seeing in other parts of the fixed income market.”