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“Risk-off” Comes with Unique Challenges

Timing the end of a prolonged recovery could prove tricky, likely leaving a jam-packed flight to safety ahead of the next downturn. Warning: it could be a bumpy ride. Passive fixed-income investing is paying you less for increased threats to your principal – including interest rate and credit risks.

Passive Fixed-income Indexing Could Cause Issues in the Future

Interest Rate Risk

Credit Risk

Less Compensation For Risk

Expand Your Portfolio Opportunities

As the cycle turns, a mix of Treasuries, munis, and corporate bonds may fall short. Reposition your portfolio by including harder-to-access credit opportunities.

Bank Loans

Potential Benefits

Sitting at the top of the capital structure with less sensitivity to interest rate changes, bank loans may help minimize interest rate and default risks.

Market Size

$1.157 TN**

High Yield Bonds

Potential Benefits

Offering more attractive yields with a lower credit rating, high-yield bonds may help boost a diversified income strategy. High-yield spreads have remained attractive as default rates have fallen.

Market Size

$1.202 TN***

Structured Credit

Potential Benefits

Income-producing, asset-backed equity and debt securities historically offer higher yields than more traditional mortgage-backed securities.

Market Size

$509.012 BN****

Business Development Companies

Potential Benefits

By filling a void in the financing marketplace, business development companies typically provide capital for small business growth initiatives in exchange for an attractive, fixed interest payment.

Market Size

$36.04 BN*****

Resource Growth Lines

Strengthen a Diversified Income Strategy

A portfolio’s “retreat to safety” requires an assessment of risk. What is more risky than missing out on the income you need?

Current Yield, as of September 30, 2019**

Core Fixed Income

Alternative Corporate Credit

Loans Are Less Sensitive to Interest Rates

Bloomberg. S&P/LSTA Leveraged Loan Index Interest Index (Senior Secured Loans) Barclays U.S. Aggregate Total Return Value Index Option Adjusted Duration (U.S. Corporate Bonds). 9/30/19. Past performance is not indicative of future results. You cannot invest directly in an index.

Avoiding a Bet on Future Interest Rates

Senior secured loans typically reset to LIBOR every three months, limiting duration in a fixed-income portfolio. The higher the duration – the greater the impact when market rates move up or down.

Read More About Rate Risk +

Corporate Credit Defaults Remain Muted

J.P. Morgan. 2018 High-Yield Annual Review. 12/20/18. Past performance is not indicative of future results. You cannot invest directly in an index. Latest information available.

Assessing Late-cycle Credit Risk

Despite a spread to corporate bonds that would indicate higher credit risk, high yield bonds and senior loans have experienced lower defaults since the Great Recession. Forecasts expect below-average defaults to continue.

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Resource is the marketing name for Resource Real Estate, LLC, Resource Alternative Advisor, LLC, and their affiliates. Resource may distribute certain products through Resource Securities LLC, a wholly owned broker/dealer, Member FINRA/SIPC


The information contained herein does not constitute an offer to sell or a solicitation to purchase securities. Such offers or solicitations can only be made by means of a prospectus. Prior to making any investment decision, you should read the applicable prospectus carefully and consider the risks, charges, expenses and other important information described therein. The value of your investments may decline, and you could lose some or all of your investment. To obtain a prospectus containing this and other information, please call (866) 773-4120 or download the file from Read the prospectus carefully before you invest.


Resource has two interval funds that are distributed by ALPS Distributors, Inc. (ALPS Distributors, Inc. 1290 Broadway, Suite 1100, Denver, CO 80203). Resource Alternative Advisor, LLC, Resource Real Estate, LLC, their affiliates, and ALPS Distributors, Inc. are not affiliated.


Performance data quoted represents past performance. Past performance is no guarantee of future results and investment returns and principal value of the Fund will fluctuate so that shares, when redeemed, may be worth more or less than their original cost. Current performance may be higher or lower than the performance data quoted above. For performance information current to the most recent month-end, please call toll-free (866) 773-4120 or visit


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