Consumer Linked Income Portfolio

Lower Volatility

= Less Worry.

No one can predict what will happen to the stock market, or commodity prices or gold or the direction of interest rates. People who retired in the year 2000 had no idea that they were about to embark on a 13 year journey where, from point to point, they gained nothing on the value of their investments. But as sure as the sun will rise tomorrow and new babies will be brought into the world, it is reasonable to assume that people will continue to consume the staples that are manufactured, sold and distributed by the companies that comprise our CLIP portfolio.

To be sure, there is no way to guarantee that the CLIP portfolio will be able to avoid a drop in dividends in the future or a decline in principal value. Our screening process attempts to avoid companies that show weakness in their ability to grow their dividend. We continue to believe that owning companies with strong balance sheets, brand loyalty and recurring sales are the types of companies that will benefit our investors.

Would You Rather Have Money or Money to Spend?

No one likes to see the value of their investments decline, ourselves included. But really, the important question is how much money is available to spend versus how much money you have. As demonstrated below, the IEF has performed well during the recent financial crisis relative to both SPY and IEF.


The chart above reflects the principal value of the SPY, XLP and IEF, exchange traded funds that closely track the S&P 500 index, S&P 500 Consumer Staples Index and the Barclays Capital U.S. 7-10 Year Treasury Bond Index, respectively. In this illustration, the dividends were distributed. The illustration does not reflect the deduction of management fees, taxes or transactional cost and is presented for informational purposes only and not as a recommendation. Past performance is not indicative of future results. Indices are unmanaged and not available for direct investment.