1 / 20

5847 San Felipe, Suite 4100, Houston, Texas 77057

INVESTING IN RETIREMENT THE GAME HAS CHANGED … OR HAS IT?. 5847 San Felipe, Suite 4100, Houston, Texas 77057 (713) 260-9000 (800) 262-6631 (713) 260-9025(Fax) . Sources of Retirement Income: 19% Social Security 21% Pension 18% Investments 40% Earned Income 2% Other.

dasha
Download Presentation

5847 San Felipe, Suite 4100, Houston, Texas 77057

An Image/Link below is provided (as is) to download presentation Download Policy: Content on the Website is provided to you AS IS for your information and personal use and may not be sold / licensed / shared on other websites without getting consent from its author. Content is provided to you AS IS for your information and personal use only. Download presentation by click this link. While downloading, if for some reason you are not able to download a presentation, the publisher may have deleted the file from their server. During download, if you can't get a presentation, the file might be deleted by the publisher.

E N D

Presentation Transcript

  1. INVESTING IN RETIREMENTTHE GAME HAS CHANGED … OR HAS IT? 5847 San Felipe, Suite 4100, Houston, Texas 77057 (713) 260-9000 (800) 262-6631 (713) 260-9025(Fax)

  2. Sources of Retirement Income: • 19% Social Security • 21% Pension • 18% Investments • 40% Earned Income • 2% Other

  3. 50% chance of one spouse surviving 25% chance of one spouse surviving Male age 65 85 92 Female age 65 88 94 Couple (both age 65) 92 97 Source: Annuity 2000 Mortality Table; Society of Actuaries. Figure assumes a person is in good health.

  4. $30,477 $23,880 2% inflation 3% inflation $18,756 4% inflation $60,000 $50,000 $50,000 $40,000 Dollars $30,000 $20,000 $10,000 $0 Today 5 years 10 years 15 years 20 years 25 years Years from retirement start date All numbers were calculated based on hypothetical rates of inflation of 2%, 3%, and 4% (historical average from 1926 to 2006 was 3%) to show the effects of inflation over time; actual inflation rates may be more or less and will vary. Source: Retirement Income Planning – America’s Lifetime Income Challenge, Fidelity Investments Insight, June 2008.

  5. How a couple retiring in 1972 with $500,000 is affected. For a 65-year-old couple, there is a 94% chance thatat least one spouse will need income at age 80. 4% Dollars Remaining $1,000,000 A couple, both age 65,would have run out ofmoney at age 88 if theyhad withdrawn 5%,adjusted upwards forinflation each year. 5% 6% 9% 7% 10% 8% $100,000 1972 1974 1976 1978 1980 1982 1984 1986 1988 1990 1992 1994 1996 1998 2000 2002 2004 2006 HypotheticalCouple(Both Age 65)* 100% atAge 65 99% atAge 70 98% atAge 75 94% atAge 80 83atAge 85 63%atAge 90 35% atAge 95 Source: Fidelity Investments. Hypothetical value of assets held in an untaxed account of $500,000 invested in a portfolio of 50% stocks, 40% bonds, and 10% short-term investments with inflation-adjusted withdrawal rates as specified. This chart’s hypothetical illustration uses historical monthly performance from January 1972 through December 2006 from Ibbotson Associates: stocks, bonds, and short-term investments are represented by S&P 500, U.S. Intermediate-Term Government Bonds, and U.S. 30-day T-bills. This chart is for illustrative purposes only and is not indicative of any investment. Past performance is no guarantee of future results. * Probability of a couple surviving to various ages is based on Annuity 2000 Mortality Table from Society of Actuaries. Figures assume you are in good health. See “Methodology and Information” at the end of this presentation for further details about indexes and methodology used to produce the chart.

  6. The Value Of Diversification

  7. Current Income Portfolio “CIP”

  8. Investment Profile Current Income Portfolio seeks to: • Provide the highest current yields available on investment grade, coupon and dividend-paying, U.S. investments; • Utilize a high degree of issuer diversification and asset allocation strategic management; • Establish a defined investment horizon to safeguard investment principal; • Maintain the highest possible real (inflation adjusted) returns.

  9. Investment Profile Current Income Portfolio invests in: • One to fifteen year corporate issues, predominately rated A/A2 to BBB/BAA2; • U.S. Agencies (with call and step-up provisions); • Corporate inflation protection (floating rate) securities; • Seasoned mortgage-backed securities; and • Listed preferred stocks.

  10. “CIP” Portfolio Characteristics6/30/09 CapstoneBCIGC** Duration 4.13* 3.87 Current Yield 6.01% 4.14% Yield to Maturity 5.26% 3.21% Average Quality A Agency * Does not include preferred stocks ** Barclay’s Capital Intermediate Government CreditIndex

  11. “CIP” Portfolio Sector Weightings6/30/09

  12. “CIP” Yield Advantage 6/30/09 Current Yield Advantage** Percent * Barclay’s Capital Intermediate Government/Credit Bond Index ** Source: Informa Investment Solutions – PSN using gross calculations

  13. Theta Growth

  14. Theta Growth • This Strategy Offers Investors: • Conservative equity portfolio: The portfolio is composed of large cap stocks. • Price appreciation potential: The portfolio seeks to achieve price appreciation from the stocks held. • The potential for attractive cash flows: Combined option premium income and dividend yield is better than current broad bond market yields and does not have interest rate risk. • Moderation of volatility on equity returns: The portfolio utilizes covered calls and is therefore less volatile than an equity- only strategy.

  15. Theta Growth Characteristics 6/30/09 Projected Average annual cash flow: 8 - 10%* Number of stocks held: 35 - 45 Number of options sold: 70 - 100% written Average option duration: Market directed (average 6 months) * Combined option premium income and dividend yield estimate.

  16. Theta Growth Sector Characteristics 6/30/09

  17. more return less risk Capstone Theta Growth BXMBuy Write Index Annual Return S&P 500 Index Annual Risk (Standard Deviation) Theta Growth 3 Year Risk vs. Return* * Source: Informa Investment Solutions – PSN using gross calculations

  18. Theta Growth Portfolio Cash Flow 6/30/09

  19. Theta Growth Performance Trailing Returns* Percent * Source: Informa Investment Solutions – PSN using gross calculations

More Related