Medium Duration Income Portfolio Performing Well

The Medium Duration Income Portfolio is now performing exactly as expected.

This portfolio was formed in February, 2018 and thus is in the 4th month of existence.

At this moment the portfolio is up 1.58% and should approach 2% by the end of the month.  Since the portfolio wasn’t fully invested (considered to be fully invested at 90% or so) for over a month a little income was lost the 1st month or two, but now the portfolio is hitting its stride.

Recall this portfolio is similar to our own personal holdings–term preferreds and baby bonds maturing in the next number of years, although there are two baby bond with a 2027 maturity.

Note that 1 baby bond was called (Arbor Realty) in April and was replaced shortly thereafter with Sutherland Asset Management 6.50% baby bonds (NASDAQ:SLDD) which has performed admirably.

This portfolio is set up as a learning tool.  When we originally set up model portfolios many years ago they were for our personal learnings–now they are more for “newbies” to income investing–those that want a reasonable return without turning to common stocks, but want more than CD’s.  The intention is that the various issues are not “traded”–simply held.

A reasonable goal for this portfolio is a return of 6% to 7% in a rising rate environment (although whether we are in a rising or falling environment remains to be seen).

10 thoughts on “Medium Duration Income Portfolio Performing Well”

  1. Thank you for running these portfolios. I have learned a lot from watching them.

    1. Hi Scott–you are welcome. I continue to run some portfolios over at dividendinvestor.com which originated in 2014 and 2015 and they remain performing well in the 7-8% range.

      1. Tim, thanks for getting this great website up and running. It has been very beneficial to me. While I know this takes a large amount of time, I am hopeful there will be bond information as well in the future.

        I have a small position in the 5.125% bonds of Speedway Motorsports (TRK)and they mature in February 2023. It is a nice holding of mine and they are rated Ba2/BB+. Debt for TRK is pretty low, and although I am certainly not a fan of Neck-Car, it makes a good addition to my mid-risk portfolio.

        1. I get many research reports on bonds, but don’t want to post them and step on anyone’s toes. I got one this evening from Randy Durig (high yield bond guy that left SA). I doubt I will ever buy one of Randy’s recommendations, because I am much more conservative than his picks and harvest different income sources that I can be more “content” with.

          1. That guy may make money hand over fist. But boy he could minimize the risk with his write ups, Nomad. He would make a CCC bond seem like it was as safe as a 1960s Ma Bell bond, lol.

          2. Grid, I like to know who I’m trusting and listening to their advice. On SA “professional” Mr Kirk Spano has been charged with at least one felony and I can’t believe that SA wants their dollars so badly that they would allow him to continue to harvest clients off of their site. This is the SEC report charging Mr Spano (look at page 14) and he has multiple leans and judgements against him as well. I’m not passing judgement on anyone, but believe this is serious enough to warrant further investigation https://www.adviserinfo.sec.gov/IAPD/content/ViewForm/crd_iapd_stream_pdf.aspx?ORG_PK=153995
            I have asked for clarification, but he has my posts deleted and must have something notorious to hide. Not really the advisor people should be following.
            Wishing you profitable investing, Nomad

  2. Randy wrote like he sold used car’s. I can picture his younger self. Slicked back hair, snake oil, plaid pants, and alligator shoes.

    1. UNMA now trading. Insurance group – not the REIT. Any opinions on this Investment grade 6.25% coupon

      1. I just bot a taste, SteveA. Not a fan of the long date but also not scared of it for such a small portfolio position.

    2. Mr. Lucky, I think your post summarizes it all! :)…….Nomad, I am like you with SA. Take most with a grain of salt. Its the naive people who truly think these guys know something that concern me.

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