Current Income Portfolio (CIP)
At Roosevelt Investments, managing for risk is not limited to equity investing. The Current Income Portfolio (CIP) seeks to benefit investors who desire reliable and high levels of income from an investment-grade portfolio. This strategy attempts to generate higher levels of coupon and interest income than our other fixed income styles.
The portfolio is comprised primarily of short- and intermediate-term, investment-grade corporate and agency obligations, and relatively liquid preferred stock positions. All holdings are rated investment-grade at purchase. The preferred stock sleeve serves as a portfolio income enhancer, as these securities typically produce higher income streams than comparable bonds of the same company.
An Overview of Our Current Income Approach
Regarding our domestic fixed income strategies, we believe that superior long-term returns are produced by minimizing price volatility while maximizing internal cash flows, such as coupon income. Therefore, for these three products, we strive to create a portfolio that provides relatively high yield, while assuming minimal risk.
The Roosevelt Current Income Portfolio Strategy is available as a separate account through Roosevelt and at various broker/dealer and financial intermediary firms.
Calculate Your Retirement Income
Current yield is the annual income of a bond divided by its current market price (not its purchase price or par value). This measure represents the income an investor would expect if he or she purchased a bond and held it for a year.
Current yield is the weighted average of the model portfolio as of 3/31/17. It is likely that the current yield for a specific client account will not be identical to the current yield of this model, and therefore, the results of this calculator would differ from the experience of actual clients. Portfolio current yield levels, as of the date listed above, are not indicative of future current yield levels, as prices of bonds may fluctuate and holdings in a portfolio may change. The above calculator is for illustrative purposes only and investment results will vary. Current yield does not predict a bond’s total return, which includes not only income but also price appreciation / depreciation.
All investments carry a degree of risk, including the loss of principal. Investing in the bond market is subject to certain risks including market, interest-rate, issuer, credit, and inflation risk. Obligations of U.S. Government Agencies and authorities are supported by varying degrees but are generally not backed by the full faith of the U.S. Government; portfolios that invest in such securities are not guaranteed and will fluctuate in value. Mortgage and asset-backed securities may be sensitive to changes in interest rates, subject to early repayment risk, and while generally backed by a government, government-agency or private guarantor there is no assurance that the guarantor will meet its obligations. The credit quality of a particular security or group of securities does not ensure the stability or safety of the overall portfolio.
The value of most fixed income securities are impacted by changes in interest rates. Fixed income securities with longer durations tend to be more sensitive and more volatile than securities with shorter durations; bond prices generally fall as interest rates rise.
Average Quality: The weighted average of the credit quality ratings for the securities in a portfolio. Credit quality is defined as a measure of the chances that a bond issuer will default on its obligations. Credit quality is determined by credit rating agencies that provide bond ratings and may change these ratings at their discretion. These bond ratings form a scale – the lower the rating, the higher the probability of default, as perceived by the rating agency.
Duration: Measure of a bond’s price sensitivity to a change in interest rates.