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High Income Strategy



CLIENT RISK PROFILE

Very Conservative



SUITABILITY

For intermediate to long-term investors who seek to avoid loss during every calendar year and outperform the Barclays Aggregate Bond Index while maintaining 100% liquidity at all times.


MANAGEMENT STYLE

Market-driven defensive

PORTFOLIO OBJECTIVE

To provide a positive total return during all one year periods as well as the opportunity for current cash distributions, if desired, by emphasizing fixed income (bonds) with little to no exposure to equities (stocks). This portfolio should experience low downside principal volatility.

INVESTMENT VEHICLES & PORTFOLIO STRATEGY

High Income Strategy portfolios utilize high yield bond and money market mutual funds. In normal market environments, high yield bond funds typically provide dividend income that is 1.5 to 4.0 times higher than T-Bills and CD’s. Money market mutual funds are considered cash equivalents and accrue dividend income on a daily basis.

Our High Income Strategy decision model is designed to signal changes in the direction of high yield bond prices. Historically, long-term trends in the economic cycle (expansion, recession and recovery) have had a greater influence on high yield bond fund performance than short-term changes in interest rates. This reduction in short-term volatility allows for easier identification of major trends in the high yield bond market as compared to other sectors.