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 investment grade preferred securities. All holdings are rated investment grade at purchase. An allocation to preferred securities 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
We believe that superior long-term returns are produced by minimizing price volatility while maximizing cash flows, such as coupon income. Therefore, 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.
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.