In this quarterly communication, we ring in the New Year by revisiting a topic that remained popular throughout 2011: increasing portfolio income. This letter discusses a research based approach to income-oriented investment strategies across both fixed income and equity asset classes. The approaches have been thoroughly researched by the Empirical Investment Committee and will be implemented starting January 2012. This letter provides a simple introduction to these strategies. The appendix summarizes many of the ways Empirical offers customization of an investment program to meet client-specific objectives.
There is no, “right” equity portfolio; instead, there are various ways to construct an equity portfolio in order to meet the specific needs and objectives of a particular investor. We believe the same is true for fixed income portfolios. Here, we briefly outline a few ways that we may modify a very conservative fixed income portfolio to change its risk and return characteristics. It is the job of your Empirical advisor to work directly with you in the context of your financial plan, to determine if any changes to your current strategy make sense. Please speak to us if you have any questions about your fixed income strategy. For the full paper:Download (PDF)