During May, as fixed income markets stabilized, the Bramshill Income Performance Strategy delivered positive performance of +0.58%, bringing YTD performance to +0.79%.
Treasury yields moved higher during the month, weighing on longer-duration assets, while credit markets remained generally resilient. Against this backdrop, portfolio activity focused on refining sector allocations, harvesting gains where valuations became less compelling, and selectively adding exposure where higher yields improved prospective returns. We reduced our preferred exposure modestly to approximately 12% of the Strategy as we trimmed select positions following the rise in yields and tighter relative valuations after new issuance activity. Proceeds were redeployed into areas offering more attractive risk-adjusted income. We increased our high yield corporate exposure to approximately 8% of the Strategy, by adding to short-duration and closed-end fund structures designed to capture elevated yields while limiting duration and beta risk. Overall high yield positioning remains intentionally modest and focused on capital preservation. Our investment grade corporate exposure remained stable at approximately 50% of the Strategy, continuing to serve as the core of the portfolio. During the month, we selectively added to high-quality, long-duration investment grade issuers as yields moved higher, including issues from KKR, CG and BRKHEC. Our long-duration treasury exposure remained steady at approximately 20% of the Strategy, providing diversification, and portfolio ballast in a shifting macro environment. Municipal exposure was unchanged at 1% of the Strategy, as we added incrementally to an existing closed-end fund position during a mid-month re-pricing in rates. Cash and short-term treasury balances remained stable at approximately 8% of the Strategy, preserving flexibility to deploy capital should volatility create more compelling opportunities. Looking ahead, we continue to favor high-quality, duration-oriented income, emphasizing rate exposure over incremental spread risk, active sector rotation, and disciplined downside risk management. With equity–bond correlations continuing to normalize, we believe high-quality fixed income can remain both a return contributor and an effective portfolio stabilizer, while selective credit exposure provides incremental income within a risk-aware framework.
This commentary is provided by Bramshill Investments, LLC for information purposes only and may contain information that is not suitable for all investors. Certain views and opinions expressed herein are forward-looking and may not come to pass. Investing involves risk, including the potential loss of principal. Past performance may not be indicative of future results, which are subject to various market and economic factors. No statement is to be construed as an offer to sell or a solicitation of an offer to buy securities or the rendering of personalized investment advice. Stated performance is reflective of realized/unrealized capital gains/losses and investment income achieve in composite accounts, net of investment management fees and expenses for trading, custody and fund maintenance (where applicable). Returns reflect the reinvestment of dividends and other such distributions and performance for January 2009 through April 2012 depicts actual returns generated by the strategy while managed by the Firm’s Chief Investment Officer at an unaffiliated investment firm. All information is accurate as of the date of publication and is subject to change without notice.