Balanced Income Strategy

As of 6/30/21

Assets Under Management

  • $26.8 million

Objectives

  • Seeks current income and, secondarily, total return consistent with the preservation of capital.

Available Vechicles

Portfolio Management Team

George J. Cipolloni III Photo

George J. Cipolloni III
Portfolio Manager

Scott Ellis Photo

Scott Ellis
Portfolio Manager

Greg Zappin Photo

Greg Zappin
Managing Director & Portfolio Manager

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Characteristics

  • Opportunistically invest within the income investable universe across asset classes (equity and fixed income) to create a diversified portfolio of high-conviction ideas.
  • Flexible asset allocation with a 40% common stock limit (at purchase) driven by a bottom-up investment process.
  • Identify the most attractive value opportunities across a company’s capital structure.
  • Credit Quality: Typically focused on triple-B to single-B corporate securities
  • Number of Positions: Typically 60-80
  • Position Size: Typically 1-2% (3% max at purchase)
80 Number of Holdings
B- Average Quality
2.4 yrs Duration
3.3 yrs Weighted Average Life
2.8% Yield to Maturity

Unless otherwise indicated, all data is reported as of June 30, 2021 and is not a representation of current or future data. Holdings and allocations are subject to change. Data is based on a representative portfolio, which is an account in the composite that PMAM believes most closely reflects portfolio management style for this strategy.

Key Asset Classes

Common and Preferred Stocks
High Yield Corporate
Investment-Grade Corporate
Convertible Bonds
Treasury/Agency
Mortgage-Backed Securities (MBS)
Asset-Backed Securities (ABS)

Asset Class Allocation

High Yield Corporate 42.8%
Investment-Grade Corporate 11.2%
Cash 9.3%
Equity 36.7%
  • 42.8%
    High Yield Corporate
  • 11.2%
    Investment-Grade Corporate
  • 9.3%
    Cash
  • 36.7%
    Equity

Unless otherwise indicated, all data is reported as of June 30, 2021 and is not a representation of current or future data. Holdings and allocations are subject to change. Data is based on a representative portfolio, which is an account in the composite that PMAM believes most closely reflects portfolio management style for this strategy. 

Bond Quality Allocation

Unless otherwise indicated, all data is reported as of June 30, 2021 and is not a representation of current or future data. Holdings and allocations are subject to change. Data is based on a representative portfolio, which is an account in the composite that PMAM believes most closely reflects portfolio management style for this strategy. 

Source: Independent Rating Agencies such as Moody’s, S&P, Fitch, etc.

Note: When a security is rated differently by three rating agencies, the median rating is used; when rated differently by two rating agencies, the lower rating is used. 

NR category consists of seven convertible bonds.

Composite Performance

3 Months YTD Since Inception1
Balanced Income Strategy - Gross 4.09% 13.06% 20.80%
Balanced Income Strategy - Net 3.92% 12.70% 19.99%
Morningstar Moderately Conservative Target Risk Total Return 4.08% 4.41% 12.55%

Unless otherwise indicated, all data is reported as of June 30, 2021 and is not a representation of current or future data. Holdings and allocations are subject to change. Past performance is no guarantee of future results. 

1Inception date 7/31/2020.

 

Balanced Income Composite Versus Morningstar Moderately Conservative Target Risk TR USD Index

Year Composite Return Composite Return Benchmark Return Composite 3 Year Standard Deviation Benchmark 3 Year Standard Deviation Dispersion of Portfolio Returns Number of Portfolios Assets in this Composite Total Firm Assets
(Gross %) (Net %) (%) (Net %) (%) (Net %) ($ MM) ($ MM)
2020* 6.85% 6.47% 7.82% N/A N/A N/A Less than 5 22 31,456
Composite Disclosure

*Cumulative return for the period is from July 31, 2020 (inception of strategy) to December 31, 2020

Definition of Firm: Penn Mutual Asset Management, LLC  (“PMAM” or "The Firm") is a registered investment adviser with the U.S. Securities and Exchange Commission in accordance with the Investment Advisers Act of 1940.

Important Performance Disclosure: PMAM claims compliance with the Global Investment Performance Standards (GIPS®) and has prepared and presented this report in compliance with the GIPS standards. PMAM has been independently verified for the periods January 1, 2012 through December 31, 2020. A copy of the verification report is available upon request. A firm that claims compliance with the GIPS standards must establish policies and procedures for complying with all the applicable requirements of the GIPS standards. Verification provides assurance on whether the firm's policies and procedures related to composite and pooled fund maintenance, as well as the calculation, presentation, and distribution of performance, have been designed in compliance with the GIPS standards and have been implemented on a firm-wide basis.  Verification does not provide assurance on the accuracy of any specific performance report. Registration with the U.S. Securities and Exchange Commission by the investment adviser does not imply any level of skill or training. GIPS® is a registered trademark of CFA Institute.  CFA Institute does not endorse or promote this organization, nor does it warrant the accuracy or quality of the content contained herein.

Methodology: Total returns are presented in U.S. dollars both gross and net of investment advisory fees, are inclusive of commissions and transaction costs, and assume reinvestment of any dividends, interest income, capital gains, or other earnings. Periods greater than one year are shown as average annual total returns. Gross composite returns do not reflect the reduction of investment advisory, administrative or custodial fees but do include trading expenses. Net composite returns are reduced by the actual investment management fee and incentive fee and any administrative, custodial, or other fees and expenses incurred. “Dispersion of Portfolio Returns” presented for each annual period is calculated using the asset-weighted standard deviation of the annual returns of all portfolios that were included in the composite for the entire year. If during a particular year the composite does not contain more than 5 accounts for the entire year, then "N/A" will be displayed. "Composite 3-Yr St Dev" and "Benchmark 3-Yr St Dev" are rolling 3-year standard deviation calculations, which measure the variability of the monthly performance returns for the composite and benchmark index return over the preceding 36-month period on an annualized basis. If the composite has not been in existence for at least 3 years as of a particular year-end, then “N/A” will be displayed. Performance data is shown rounded to the nearest hundredth.

A list of composite descriptions, a list of limited distribution pooled fund descriptions, and a list of broad distribution pooled funds are available upon request. Policies for valuing investments, calculating performance, and preparing GIPS Reports are available upon request. Past performance is not indicative of future results and no investment is guaranteed for return of principal and/or return on investments.  All information provided and used in calculations is believed to be correct, but accuracy cannot be guaranteed. 

Composite Description: The Balanced Income Composite consists of portfolios managed on a discretionary basis with an investment objective that seeks current income and, secondarily, total return consistent with the preservation of capital. In seeking to achieve its investment objective, the Composite principally invests in a portfolio of corporate bonds, dividend-paying common stocks, preferred stocks, U.S. Treasury bills, bonds and notes, debt securities issued by U.S. Government agencies, asset-backed securities, mortgage-backed securities and municipal bonds. Certain of the Composite’s investments in corporate bonds and preferred stocks may be convertible into common stocks. The Composite may invest any percentage of its net assets in the foregoing securities as the Adviser deems appropriate, except that the Composite will normally invest no more than 40% of its net assets in common stocks.

Benchmark Description: The benchmark for this composite is Morningstar Moderately Conservative Target Risk Total Return USD Index. The Morningstar Target Risk Index family is designed to meet the needs of investors who would like to maintain a target level of equity exposure through a portfolio diversified across equities, bonds and inflation-hedged instruments. The Morningstar Moderately Conservative Target Risk Index seeks approximately 40% exposure to global equity markets.

Inception and Composite Creation Date: July 31, 2020

Fee Schedule: The investment advisory fee applicable to a portfolio depends on a variety of factors, including but not limited to portfolio size, the level of committed assets, service levels, the use of a performance fee or minimum fee arrangement, and other factors. The current maximum scheduled investment advisory fee for this strategy is 45 basis points. The investment advisory fee and total expense ratio for the Penn Mutual AM 1847 Income Fund, which is included in the composite, are 0.45% on all assets and 0.65%, respectively.

 

Disclosure Statement

Past performance is not indicative of future results. Investors should be aware of the additional risks associated with investments in non-diversification, undervalued or overlooked companies and investments in specific industries. In addition, investors should be aware of the additional risks associated with investments in non-investment grade (high yield) debt securities and structured securities, which are subject to greater fluctuations in value and risk of loss of income and principal as a result of interest rate risk and economic risk. Additional risks may include those associated with investing in foreign securities, emerging markets and currencies. There is no guarantee that dividend-paying equities will pay or continue to offer their dividends. Diversification neither assures a profit nor eliminates the risk of loss.

The information herein does not constitute investment advice and the strategy described may not be available to, or suitable for, all investors.

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