How to Achieve a 6% Target Income Distribution | A Manager Conversation with Ninepoint’s Colin Watson

In this manager conversation, Sightline Wealth Management’s Warren Gerow speaks with Colin Watson, a portfolio manager at Ninepoint Partners whose background spans across equities, asset allocation and derivative-based strategies, to introduce the Ninepoint Target Income Fund. During their conversation, Watson offers an inside look at how this fund utilizes a diversified options-based strategy, known as cash-secured put selling, to offer a 6% target income distribution to unitholders without the volatility that often comes with direct investments in the broad equity markets.

Some of the specific topics Gerow and Watson address include:

  • An overview of put options and why the fund utilizes cash-secured put selling
  • Real-life examples of how investors can benefit from cash-secured put selling
  • How the fund improves diversification and mitigates risks within its portfolio
  • How European options differ from North American options
  • The fund’s current portfolio exposures and typical fees
  • The advantages of using cash-secured put selling over other options-based strategies
  • Income generation for investors via a cash-secured put selling strategy
  • Potential impacts of future rate hikes and different market environments on the fund’s returns

Throughout the conversation, Watson emphasizes the various ways the fund’s income strategy of cash-secured put selling opens the door to this tactic’s long-standing track record of offering defensive attributes. He also highlights how it provides investors with a differentiated income stream beyond traditional stocks and bonds.

If you have any questions regarding this conversation or are interested in allocating towards the Ninepoint Target Income Fund, please do not hesitate to contact us.

Important Information: 

Warren Gerow is an independent investment wealth consultant at Sightline Wealth Management.

Sightline Wealth Management LP (“Sightline”) is an investment dealer and is a member of the Investment Industry Regulatory Organization of Canada (IIROC) and the Canadian Investor Protection Fund (CIPF). Sightline provides management and investment advisory services to high-net-worth individuals and institutional investors primarily through fee-based accounts. 

Sightline Wealth Management LP is a wholly owned subsidiary of Ninepoint Financial Group Inc. (“NFG Inc.”). NFG Inc. is also the parent company of Ninepoint Partners LP, it is an investment fund manager and advisor and exempt market dealer. By virtue of the same parent company, Sightline is affiliated with Ninepoint Partners LP. Information and/or materials contained herein is for information purposes only and does not constitute an offer to sell or solicitation to purchase securities of any issuer or any portfolio managed by Sightline Wealth Management or Ninepoint Partners, including Ninepoint managed funds. 

Sightline Wealth Management (“Sightline”) makes every effort to ensure that the information has been derived from sources believed to be reliable and accurate. However, Sightline assumes no responsibility for any losses or damages, whether direct or indirect, which arise out of the use of this information. Sightline is not under any obligation to update or keep current the information contained herein. The information should not be regarded by recipients as a substitute for the exercise of their own judgment. Past performance is not indicative of future performance. Please speak to your Advisor regarding the suitability of information provided in this article for you. The opinions, estimates, projections and/or recommendations contained in this document are those of the author as of the date hereof.

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