AMAX delivers high current income by combining multiple asset classes with an adaptive hedging overlay. The fund targets yield-hungry investors who want income diversification beyond traditional bonds while maintaining some downside protection through tactical hedging.
How It Works
The fund allocates across dividend stocks, REITs, MLPs, preferred shares, and high-yield bonds to maximize income potential. An adaptive hedging mechanism adjusts protection levels based on market volatility and momentum signals. The multi-asset approach means correlation benefits during normal markets but convergence risk when everything sells off together. Income distributions come monthly from this diverse basket.
Key Features
- 8.91% yield beats most income ETFs by blending higher-risk asset classes
- Adaptive hedging adjusts protection dynamically rather than maintaining constant coverage
- Monthly distributions from diversified income sources reduce single-sector concentration
Risks
- Multi-asset income strategies got crushed in March 2020 when correlations went to 1.0
- Hedging costs can eat 1-2% annually, reducing net returns even when protection isn't needed
- High yield often means dividend cuts are coming - that 8.91% may not be sustainable
Who Should Own This
Best for retirees or income investors who've maxed out traditional bond allocations and can stomach moderate volatility for higher yield. Works as a 5-10% portfolio position to boost overall income without betting everything on stocks or junk bonds. The hedging overlay makes it more suitable than unhedged high-yield strategies for risk-conscious income seekers.