AB American Income Strategy

Why AB American Income Strategy?

The AB American Income Strategy seeks to provide a high level of current income consistent with preservation of capital by investing in a diversified portfolio of US dollar-denominated bonds, including investment grade, high yield, non-investment grade bonds/fixed income securities within and outside of the US. The Strategy has stood the test of times over the past three decades, its proven track record attests to its success in evolving with the market and adapting to cyclical changes.

Income

The Strategy targets multiple sources of income. By pairing higher yielding credit with higher quality, more interest-rate sensitive securities, we aim to capture a steady stream of income with capital preservation.

Balance

A minimum 50% of the Strategy assets are invested in government and investment grade-rated (IG) bonds for stability*. The other half is invested in below IG securities such as high-yield corporate bonds and other credit assets to enhance income and dampen interest rate risks.

Diversification

Issuers are picked from a variety of sectors in a bid to search for the best opportunities. Under normal market conditions, at least 65% of assets must be in securities issued by US entities. Having a multi-sector exposure also ensures there is less risk of the potential damage that a large drawdown, or spike in default rates, might have in any single sector.

*IG bonds are considered less volatile and usually deliver a lower return than compared to US high yield bonds, which typically offer higher returns but with more risk.