In a climate of low interest rates, the Inflation Plus Portfolio strives to deliver a current income above the rate of inflation and prevailing rates offered by money market funds.
Through the risk reducing benefits of owning uncorrelated assets, we believe that adding small slices of higher income assets to a core position of short-duration stable fixed-income assets can boost income without a commensurate increase in portfolio volatility.
the Inflation Plus Portfolio utilizes a top-down approach that generally invests in ETF’s that track indices of several different asset classes including but not limited to:
- Investment-Grade Corporate Bonds;
- Mortgage-Backed Securities;
- Commercial Mortgage-Backed Securities;
- Preferred Stock;
- Utility Sector Equities;
- High-Yield Corporate Bonds;
- U.S. Treasury Securities;
- Municipal Bonds; and
- Money Market Funds
The portfolio is constructed around a core holding of short-duration fixed income asset classes that have historically demonstrated very little daily volatility. These core asset classes include short-term corporate bonds, treasury bills, and mortgage-backed securities. This core grouping of assets will generally account for more than half of the assets in the portfolio.
This core holding will be supplemented with small positions in additional higher income-producing asset classes that have low correlation to the core holdings.
We believe this portfolio can generally offer income greater than the prevailing level of inflation with low volatility of the portfolio’s principal. Generally, the income provided by the ETF’s will represent the majority of the potential total return of the portfolio.
For more information please see Part 2A of our Form ADV available on the SEC’s website at www.adviserinfo.sec.gov. You may also request a copy from Pelican Bay Capital Management by e-mailing us at firstname.lastname@example.org.