Income Strategy

An Unconventional Approach to Income

Why a Flexible Income Strategy?

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

Mitigate Volatility: Non-traditional 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.

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?

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.

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

How to Invest

Investment Options: We have options for all types of investors. Have questions? Contact us. We’re happy to help.

Institutional Separate Account – Call us at 410.454.3130 or email us.

Mutual Fund for U.S. Investors

Income Strategy Data — 4Q 2017

All data as of 12/31/2017

Investment Minimum: $50 million

Annualized Performance1

  • Gross of Fees
  • Net of Fees
  • Merrill Lynch US High Yield Master II
  • S&P 500

 

QTD

1-Year

3-Year

5-Year

Since Inception (4/3/09)

Gross of Fees

1.05%

17.88%

5.42%

9.08%

16.64%

Net of Fees

0.80%

16.73%

4.38%

8.01%

15.50%

Merrill Lynch US High Yield Master II

0.41%

7.47%

6.38%

5.80%

12.22%

S&P 500

6.64%

21.83%

11.41%

15.79%

17.27%

Allocation Breakdown2

  • Publicly Traded Partnerships (PTPs) 24.59%
  • Equity 24.18%
  • Bonds 19.99%
  • Real Estate Investment Trusts (REITS) 15.04%
  • Preferred Equity 8.25%
  • Business Development Companies (BDCs) 7.95%

Asset Allocation2

  • Common Equity 69.66%
  • Fixed Income 19.90%
  • Preferred Equity 8.01%
  • Cash 2.43%

Top 10 Holdings By Issuer2

  • Apollo Global Management, LLC. 6.13%
  • Carlyle Group LP 5.86%
  • Valeant Pharmaceuticals International, Inc. 5.01%
  • Seaspan Corp. 4.91%
  • New Residential Investment Corp. 4.26%
  • AmTrust Financial Services, Inc. 4.19%
  • Chimera Investment Corp. 3.95%
  • EIG Investors Corp. 3.83%
  • Triangle Capital Corp. 3.75%
  • Abercrombie & Fitch Co. 3.46%

Characteristics2

  • Number of Holdings 42
  • Current Yield3 8.02%
  • Annual Turnover 44.67%
The nature of financial markets is such that when the overwhelming consensus is on one side, the investment opportunities usually lie on the other. Bill Miller, CFA December 1992