COLLEGE PLANNING | ESTATE PLANNING | INVESTING | PORTFOLIO SPOTLIGHT | REAL ESTATE | RETIREMENT | TAX PLANNING
Intrepid Income Fund
TICKER ICMUX
ASSETS $ 542.4 billion
PERFORMANCE |
YTD |
1 yr . |
3 yr . |
5 yr . |
10 yr . |
|
3.31 % |
12.07 % |
4.95 % |
6.21 % |
4.17 % |
TOP 5 HOLDINGS Valvoline Inc . ( 02 / 15 / 30 4.250 %); Cimpress Plc ( 06 / 15 / 26 7.000 %); Equitrans Midstream Corp . ( Perp . Perf 9.750 %); Turning Point Brands ( 02 / 15 / 26 5.625 %); Abercrombie & Fitch ( 07 / 15 / 25 8.750 %)
CONTACT INFO
866-996-3863 • intrepidcapitalfunds . com
ASSET ALLOCATION ( As a % of portfolio ) |
Corporate Bonds |
79.4 % |
Loans |
10.3 % |
Preferred Stock |
4.5 % |
Convertible Bonds |
3.8 % |
Common Stock |
1.4 % |
Cash or Equivalent |
0.6 % |
Performance and asset numbers as of 5 / 8 / 24 . Holdings as of 3 / 31 / 24 . Sources : Intrepid Capital Management and Morningstar .
Short-Term View , Long-Term Results
The Intrepid Income Fund ’ s focus on short-duration fixed income has been a winner . By Jeff Schlegel
INVESTORS HAVE BEEN TYING THEMSELVES UP IN KNOTS during the past year or so over when the Federal Reserve will start lowering interest rates . Not so the folks at the Intrepid Income Fund , whose fixed-income strategy frees them from fretting the Fed .
The fund ’ s stated goal is to generate absolute returns while producing current income at a higher yield against comparable maturity U . S . Treasurys . It attempts to do so by investing mainly in short-duration , smaller-cap high-yield credits that are out of favor or under-followed by the broader investment community . The fund ’ s managers call this their sweet spot .
As co-lead portfolio manager Mark Travis notes , he and his team have produced market-beating returns by taking “ threefoot puts ” focused on investing on the short end of the curve . He and his team posit that focusing on short-duration securities generates consistent income , which translates into monthly payouts for the fund ’ s investors . The fund ’ s 30-day SEC yield as of March 31 was 7.9 %.
The strategy requires less macro forecasting and gives the managers a higher degree of confidence in return of principal . It also lets them quickly respond to changing market conditions . Because the fund ’ s returns are less sensitive to interest rate fluctuations , its managers don ’ t spend a lot of time speculating on the Fed ’ s interest rate moves .
“ We ’ re positioned either way to take advantage of a lower-rate market or a market with higher rates ,” says Hunter Hayes , Travis ’ s fellow co-lead portfolio manager . “ A lot of that is afforded to us by our short-duration mandate . We get money constantly coming back to us that we can redeploy with a new opportunity set based on what we see from a risk / reward perspective .”
Focus On What Works Best
The Intrepid Income Fund has produced a solid track record since the strategy launched in 2007 . ( The fund ’ s current institutional class shares began trading in 2010 .) During the past 10 years ( as of May 8 ) the fund ranked third for average annual returns in
44 | FINANCIAL ADVISOR MAGAZINE | JUNE 2024 WWW . FA-MAG . COM