The Enhanced High Yield Model Portfolio continues to perform almost exactly as designed.
Remember this is simply an educational tool–one that demonstrates LONG TERM performance of a portfolio of relatively high yield preferred stocks and baby bonds. The intent is to not ‘trade’ the account–simply purchase and hold, unless substantial bad news is known or suspected about a issuing company.
This model was formed on 1/25/2018–so it will be 2 years old in a few weeks. To date the portfolio has a total return of 16.11% and holds a cash position of about 10%. We currently have goal of an annual return of 7.50%.
Initially the model had only about 10 issues, but we have worked to continue to expand holdings and now are up to 13 issues in a portfolio of $116,000 – I will be adding 2 more positions in the next 60 days and then will hold the portfolio in the 15 issue area – helping to spread the risk.
This model has the ability to hold a REIT or MLP, but with REITs running to sky high level we have not held other holdings for quite some time–likely this will only change if REITs set back in pricing.
The Medium Duration Model Portfolio has NOT performed as well because of 1 disastrous holding–we will wright a bit on this soon.