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.
Portfolio Snapshot
All data as of 09/30/2023
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 | 10-Year |
Since Inception (4/3/09) |
Gross of Fees |
2.1% |
2.1% |
14.3% |
6.7% |
0.7% | 4.3% |
10.9% |
Net of Fees |
1.9% |
1.4% |
13.2% |
5.7% |
-0.5% | 3.9% |
9.3% |
ICE BofA Merrill Lynch US High Yield Master II |
0.5% |
6.0% |
10.2% |
1.8% |
2.8% |
4.2% |
8.5% |
Allocation Breakdown2
- Equity 68.0%
- Bonds 20.8%
- Real Estate Investment Trusts (REITs) 9.3%
- Publicly Traded Partnerships (PTPs) 1.9%
Asset Allocation2
- Common Equity 78.6%
- Fixed Income 20.6%
- Preferred Equity 0.0%
- Cash 0.8%
Top 10 Holdings By Issuer2
- GEO Group Inc. 7.7%
- Stellantis N.V. 6.2%
- AT&T, Inc. 5.5%
- CTO Realty Growth, Inc. 5.0%
- The Cannabist Co Holdings, Inc. 4.9%
- OneMain Holdings, Inc. 4.7%
- Western Alliance Bancorp 4.5%
- Viatris Inc. 4.4%
- Vonovia SE 4.3%
- Jackson Financial, Inc. 4.3%
Characteristics2
- Number of Holdings 31
- Current Yield3 5.4%
- Annual Turnover 41.1%
Click here for the Income Strategy GIPS Disclosure document.
1 Performance for periods longer than one year is annualized. Past performance is no guarantee of future results. Miller Value Partners claims compliance with the Global Investment Performance Standards (GIPS®). To receive a complete list and description of our composites and/or a presentation that adheres to the GIPS standards, please contact us.
2 Source: FactSet. Representative portfolio characteristics, holdings, sector weightings, turnover and market capitalization are subject to change at any time. Holdings, sector weightings, market capitalization, turnover and portfolio characteristics of individual client portfolios may differ, sometimes significantly, from those shown. This information does not constitute, and should not be construed as, investment advice or recommendations with respect to the securities and sectors listed.
3 Miller Value Partners calculates the Strategy’s current yield by using the most recent cash dividend or interest payment for each holding as an indication for what the position might pay over the next twelve months. We attempt to calculate the current yield in a conservative way by adjusting for “special” or “true-up” dividends that may not represent sustainable cash flows. We also assume no yield in cases where we have a high degree of confidence that the company will implement a significant dividend in the near future. Despite our attempted conservatism, we cannot guarantee that we will deliver the current yield over the coming year.
All investments are subject to risk, including the possible loss of principal. Fixed income securities involve interest rate, credit, inflation and reinvestment risks; and possible loss of principal. As interest rates rise, the value of fixed income securities falls. Risks of high yield securities include greater price volatility, illiquidity and possibility of default. There is no guarantee investment objectives will be met. Neither Miller Value Partners nor its information providers are responsible for any damages or losses arising from any use of this information.