FIXED INCOME PHILOSOPHYThe primary objective is current income and reasonable stability of principal. We don’t believe in trying to outguess interest rate moves, a high risk strategy with little chance of good long-term results. Fixed income can be used as a primary driver to generate desired lifestyle income. Historically, stocks have offered higher returns than bonds, however, fixed income investments are generally less volatile and can:
▪ Help improve long-term portfolio performance
▪ Reduce volatility versus a portfolio of stocks alone
▪ Generate an income stream for living expenses or capital expenditures
▪ Serve as a cash alternative and potentially offer yields above money market rates
We consider the following when determining your fixed income strategy:
A change in your tax rate could require a portfolio adjustment.
YOUR FUTURE TAX RATE
A laddered approach provides ongoing reinvestment opportunities.
YOUR PORTFOLIO'S MATURITY SCHEDULE
Is credit quality improving or declining?
Investing in various market sectors, maturities and issuers can reduce volatility and credit risk.
By investing in high-yield bonds you may be subjected to greater price volatility based on fluctuations in issuer and credit quality. When investing in bonds, you are subject, but not limited to, interest rate, inflation and credit risks associated with the underlying bonds. Bonds may be worth less than original cost upon redemption or maturity.