INSIGHTS
By
John Tabb,
Chief Operating Officer
Apr 8, 2025
Our portfolio managers discuss market volatility, closed-end fund dislocations, and tactical positioning with a focus on capital preservation and emerging fixed income opportunities in this quarterly update call.
Overview
In this candid and timely update, portfolio managers Peter Montalbano and Michael Lowenberg of the Modern Capital Tactical Income Fund break down Q1 market movements and how they're tactically navigating extreme volatility. With closed-end funds trading at historic discounts and credit markets under pressure, the team sees emerging opportunity — but with caution.
Topics include:
Why recent NAV vs. market price dislocations are creating long-term entry points
Managing liquidity and maintaining a 15–20% cash buffer
Current sector focus: fixed income over equities, with eyes on emerging market debt, munis, and high yield
Their approach to duration and risk as Fed rate cuts loom
How volatility (VIX) drives their opportunistic deployment of capital
Insights into return of capital vs. sustainable income in CEFs
The team emphasizes capital preservation for now — and disciplined preparation for re-engagement when the market stabilizes.
Disclosure:
© 2025 Morningstar, Inc. All rights reserved. The Morningstar Rating™ is for the Class A only; other classes may have different performance characteristics. The rating is not a recommendation to buy, sell, or hold the fund. Morningstar does not guarantee its accuracy or completeness and is not responsible for damages or losses arising from any use of this information.
Investors should consider the Fund’s investment objectives, risks, charges, and expenses before investing. The prospectus, containing this and other information about the Fund, should be read carefully before investing. The prospectus is available at the download icon below or by calling 800-711-9164. Current and future holdings are subject to change and risk.
Investments in the Fund are subject to investment risks, including the possible loss of some or all of the principal amount invested. There is no assurance that the Fund will be successful in meeting its investment objective. The Fund is subject to the following additional risks:
▪ Active Trading Risk: Active trading may result in added expenses, a lower return, and increased tax liability. Since the Fund’s advisor engages in high turnover trading strategies, the Fund will have high portfolio turnover rates.
▪ Closed-End Fund Risk: Closed-end funds (CEFs) are subject to investment advisory and other expenses, which will be indirectly paid by the Fund resulting in duplicative fees and expenses. CEFs are also subject to management risk because the advisor to the underlying CEF may be unsuccessful in meeting the fund’s investment objective.
▪ Equity Securities Risk: Equity securities are subject to changes in value, and their values may be more volatile than those of other asset classes. These changes in value may result from factors affecting individual issuers, industries, or the stock market.
More information about these risks can be found in the Fund's prospectus.
Vigilant Distributors, LLC., Member FINRA/SIPC. There is no affiliation between Modern Capital Management Co., including its principals, and Vigilant Distributors, LLC.
- No Bank Guarantee
- May Lose Value
- NOT FDIC-INSURED