Durig Capital's Fixed Income 2 (FX2) Portfolio Review - Q1 2018

Apr. 07, 2018 1:07 AM ETAPDFX, ARTFX, CSOIX, DDJCX, DDJIX, DPFNX, FAGIX, FAHCX, FOCIX, HNRAX, HNRCX, HNRZX1 Comment3 Likes
Randy Durig profile picture
Randy Durig
2.59K Followers

Summary

  • Up 4.10% YTD.
  • Up 11.93% in Trailing 1 Year Return.
  • Up 13.02% in Trailing 3 Year Return.

For many years Durig Capital has published its Fixed Income 2 (FX2) high-yield bond ideas on Seeking Alpha as they were added to our FX2 client portfolios. In this article we review the performance of Durig's Fixed Income 2 (FX2) Portfolio to explore the relationship between portfolio composition and overall performance, and a glance at some of the risk & reward characteristics of the portfolio as of the 1st quarter-end, 2018.

The relatively standard benchmarks shown below are compared to the Year-to-Date (YTD) and Trailing 1 year, Trailing 3 year and Trailing 5 year returns, provided by the High-Yield Bond Mutual Fund database provided by Morningstar. We estimate that Morningstar tracks the performance of and benchmarks close to 800 High-Yielding Bond Mutual Funds, and on April 5th, 2018, this is how our clients aggregated FX2 portfolios compared to Morningstar's high-yield bond fund database:

YTD

Year-to-Date, FX2 aggregated returns are up 4.10%.

  1. Highland Opportunistic Credit Z (HNRZX), 3.91% YTD

  2. Highland Opportunistic Credit A (HNRAX), 3.55% YTD

  3. Highland Opportunistic Credit C (HNRCX), 3.41% YTD

  • The average YTD return among the high-yield bond mutual funds listed was - 0.76%

  • FX2 aggregated year to date returns were 639% above the average YTD return of the high-yield bond mutual funds listed

Trailing 1 Year

For a Trailing 1 Year period, FX2 aggregated returns were up 11.93%.

  1. DDJ Opportunistic High Yield I (DDJCX), 9.28%

  2. DDJ Opportunistic High Yield Institutional (DDJIX), 9.27%

  3. Deer Park Total Return Credit I (DPFNX), 9.18%

  • The average Trailing 1 Year return among the high-yield bond mutual funds listed was 3.25%

  • FX2 aggregated Trailing 1 Year returns were 267% above the average Trailing 1 Year return of the high-yield bond mutual funds listed

Trailing 3 Year

For a Trailing 3 Year period, FX2 aggregated returns were up 13.02%.

  1. Artisan High Income Advisor (APDFX), 7.10%

  2. Artisan High Income Investor (ARTFX), 6.91%

  3. Credit Suisse Strategic Income I (CSOIX), 6.58%

  • The average Trailing 3 Year return among the high-yield bond mutual funds listed was 3.89%

  • FX2 aggregated Trailing 3 Year returns were 234% above the average Trailing 3 Year return of the high-yield bond mutual funds listed

Trailing 5 Year

For a Trailing 5 Year period, FX2 aggregated returns were up 9.11%.

  1. Fairholme Focused Income (FOCIX), 7.75%

  2. Fidelity Capital & Income (FAGIX), 6.54%

  3. Fidelity Advisor High Income Advantage I (FAHCX), 6.26%

  • The average Trailing 5 Year return among the high-yield bond mutual funds listed was 3.82%

  • FX2 aggregated Trailing 5 Year returns were 138% above the average Trailing 5 Year return of the high-yield bond mutual funds listed

Risk/Reward

When compared to our closest benchmark, Bloomberg Barclays US Aggregate Bond Index TR USD, the FX2 Portfolio provides an excess return of over 11%, and a beta of 0.33.

We believe we have an outstanding upside capture ratio, which is displayed below.

Disclosure: Past performance is no guarantee of future results. FX2 is a composite of individual (segregated) bond accounts comprised of individual bond positions, with return averages both higher and lower than the FX2 composite returns. Individual (segregated) accounts are a different investment vehicle than bond funds, offering more easily customized asset allocation and tax accountability compared to having all the investments held in one single large pool.

This article was written by

Randy Durig profile picture
2.59K Followers
Durig Fixed Income provides market leading products and services: Please review our performances:  Durig's Fixed Income 2 (FX2)  &  Durig's Distressed Debt 1 Hedge Fund (DD1)  We  provide a Free Newsletter updating the fundamental research on several high yielding institutional bonds at Bond-Yields.com, combined with our low cost assistance, often allows our clients to broadly diversify their fixed income portfolio while often greatly enhancing their yields plus attaining superior overall returns. This service often allows our clients to achieve a much higher income combined with far greater diversification. -  call us at 971-327-8847
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Disclosure: I/we have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it. I have no business relationship with any company whose stock is mentioned in this article.

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