Absolute Income Celebrates One Year

Tradition Capital Management celebrates the one year anniversary of its investment strategy, Absolute Income. Absolute Income was developed to fill the income requirement desired by many clients. This is seen as a replacement for the low yields currently available in bonds. In its first year, Absolute Income delivered a 8.98% return for the year ending June 30, 2017, while the Barclay’s U.S. Aggregate Bond Index returned -0.31% over the same time period.

“With interest rates at historical lows, traditional bonds, both municipals and taxables, are not providing the yields necessary to generate income for clients. We created the Absolute Income Fund to fill this need,” states Benjamin C. Halliburton, Chief Executive Officer of Tradition Capital Management. “The typical investor portfolio is comprised mostly of stocks and bonds. There are other asset classes – non-correlated ones – that can be introduced into a portfolio to increase diversification while keeping their risk exposure near the same level. Absolute Income uses these low-correlated asset classes to lower volatility in a client’s portfolio while providing a higher expected yield and the results we’ve seen this first year demonstrates their effectiveness.”

Positioned as a bond substitute, the Absolute Income Fund has the potential to increase a client’s income stream compared to a traditional bond portfolio while providing some protection in a down market. The Absolute Income Fund uses diversifying assets, including reinsurance, alternative lending, variance risk premium harvesting, and real estate to increase the potential expected return while diversification lowers, but does not eliminate, a client’s exposure to risk. While the Barclays Aggregate Bond Index has an expected yield of 2.5%, Tradition’s Absolute Income Strategy is modeling an expected yield of 6.8%. Tradition believes it has created a fund to increase expected yield not just in the short run, but as long as interest rates remain unusually low.

About Tradition Capital Management, LLC:

Tradition Capital Management, LLC is an SEC Registered Investment Adviser (RIA) under the Investment Advisers Act of 1940 providing portfolio management and related services for a fee. Founded in 2000, Tradition manages over $500,000,000 in assets and has over 250 years…

Read the full article from the Source…

Leave a Reply

Your email address will not be published. Required fields are marked *