Income Strategy

An Unconventional Approach to Income

Why our Income Strategy?

Align Interests: We are the largest individual investors in the strategy, aligning our interests with those of our investors.

Focus on Value: By targeting high-yielding securities at significant discounts to their intrinsic values, we attempt to generate capital appreciation on top of high current income.

Migrate to Opportunity: The Strategy can own almost any type of security across the globe, allowing us to invest tactically in the asset classes we think are likely to generate the best risk-adjusted returns. Income Strategy can own high-yield corporate debt, income-paying common stock, preferred shares, convertible securities, REITs, business development companies, MLPs and more.

Why Now?

Enhance Income: After years of low yields for traditional income investments, many investors are looking to enhance their portfolio with higher yields.

Manage Duration: Investors worry about their bond portfolios in a rising-rate environment. A flexible, actively managed portfolio of income-paying securities may exhibit less duration risk than traditional fixed-income securities.

Mitigate Volatility: Nontraditional income sources may offer the opportunity for higher yields and the potential for higher long-term capital appreciation. When actively managed in a single portfolio, alternative income sources’ potential for lower correlations may mitigate excessive volatility.

Stay Active: As an active manager, we have the ability to take advantage of changing market conditions and exercise our patient, long-term approach.

3Q 2018 Portfolio Snapshot

All data as of 09/30/2018
Investment Minimum: $10 million

Annualized Performance1

  • Gross of Fees
  • Net of Fees
  • ICE BofA Merrill Lynch High Yield Master II

 

QTD

YTD

1-Year

3-Year

5-Year

Since Inception (4/3/09)

Gross of Fees

0.62%

12.05%

13.23%

14.81%

8.01%

16.62%

Net of Fees

0.37%

11.23%

12.11%

13.68%

6.95%

15.48%

Merrill Lynch US High Yield Master II

2.42%

2.92%

8.18%

5.54%

11.58%

Allocation Breakdown2

  • Equity 34.52%
  • Publicly Traded Partnerships (PTPs) 24.56%
  • Bonds 16.48%
  • Real Estate Investment Trusts (REITs) 13.49%
  • Preferred Equity 4.19%
  • Business Development Companies (BDCs) 3.84%
  • Bank Loan 2.92%

Asset Allocation2

  • Common Equity 75.2%
  • Fixed Income 19.0%
  • Preferred Equity 4.1%
  • Cash 1.7%

Top 10 Holdings By Issuer2

  • Macquarie Infrastructure Corp. 5.77%
  • Apollo Global Management LLC 4.64%
  • Avon Products, Inc. 4.58%
  • Carlyle Group LP 4.55%
  • National CineMedia, Inc. 3.93%
  • Hi-Crush Partners LP 3.46%
  • Public Joint Stock Company ALROSA 3.44%
  • Endo Ltd. 3.29%
  • CenturyLink Inc. 3.29%
  • New Residential Investment Corp. 3.20%

Characteristics2

  • Number of Holdings 38
  • Current Yield3 7.79%
  • Annual Turnover 37.2%