As many of you know we started a newer strategy to complement our legacy capital accumulation business approximately 2 years ago, a strategy meant to provide investors who require income with an alternative to the low yields available in today’s low rate market.
From time to time I have commented on the progress of my own Takota Income Value Account. I am pleased to report that the gross* return for my own account is 34.4% over its first 2 years + 50 days of operation (March 1, 2016 – April 18, 2018).
What’s more – this extraordinary return was accomplished with a broadly diversified portfolio (maximum 5% weighting in any security with no averaging up or down) and with fully 50% of the portfolio on average sitting in cash equivalents for the entire period – a truly astounding risk adjusted return and the best that we have been able to find in the income area over that period – anywhere.
For myself, and for the other customers of our income investing strategy our overriding fixation is to maintain this track record, and build upon it.
With an aging population the desire amongst investors for sources of passive income is strong. The desire for yield in a yield constrained world has, in our view made the area of income investing fraught with potential pitfalls. Most securities are fully priced. One must tread carefully.
With our broad diversification, our value focused process, our significant cash weighting (now 40%) and our unique knowledge of and experience with tools to be deployed to protect capital where required, we are highly confident that we can turn any future market challenges into profitable income investing opportunities.
More about our Income Value Strategy and the progress of my own account in future blogs. Contact me or visit our website if you require more information (www.takota.ca)
*gross return is the return before the application of management fees and performance fees. These fees reduce gross performance. I do not charge myself management fees.
This blog is for information purposes only. It is not a solicitation to invest in the Takota Income Value Strategy or any other Takota investment strategy. It is simply an update on a current corporate project, and my personal experience with that project. Individuals interested in actually investing in the Income Value Strategy would need to review with the Portfolio Manager the appropriateness of this strategy for their financial/investment objectives. The Takota Income Value Account is a managed segregated account strategy offered by Takota Asset Management. It is designed to provide income from a diverse source of opportunities, with reduced volatility, while preserving capital and retaining the capacity for some capital growth. Management and performance fees are charged according to an established schedule.