Intentional Investing in the Age of Income

Never before have so many Americans needed to generate income in a low yield environment. We call this the Age of Income.

Working with Invesco and your financial advisor you can take an intentional approach to income investing — selecting strategies that align with today's investor needs in today's challenging market and positioning for the risks and opportunities that tomorrow may bring.

Because you don't just need income. You need the right income.

Prepare your portfolio for the following needs and challenges:

Today's Investor

Needs:

  • High Current Income
  • Sustainable Income
  • Capital Growth and Income
  • Capital Preservation and Income

Consider:

The appropriate mix of current income, future growth and capital preservation.

Use our income finder to identify your income needs to find strategies to consider for today's market and tomorrow's outcomes.

Today's Market

Challenges:

  • Low interest rates
  • Low economic growth
  • Volatility

Consider:

Consider income solutions that may perform in today's low-growth and low-rate environment.

Use our income finder to identify your income needs to find strategies to consider for today's market and tomorrow's outcomes.

Tomorrow's Outcomes

Concerns:

  • Recession
  • Inflation
  • Rising interest rates

Consider:

Consider income strategies that may turn tomorrow's potential outcomes into opportunities.

Use our income finder to identify your income needs to find strategies to consider for today's market and tomorrow's outcomes.

Diversification in the Age of Income

A broadly diversified income portfolio may capture more opportunities in all types of economic environments. It is clear to see that during different years, different asset classes have outperformed.

Income Asset Classes Take Turns Leading

Source: StyleADVISOR, Bloomberg L.P. and Invesco, as of Dec. 31, 2014. Emerging Markets Debt is represented by JP Morgan GBI-EM Global Diversified Index; High Yield (Corporates) is represented by Barclays U.S. High Yield 2% Issuer Cap Index; High Yield (Municipals) is represented by Barclays Municipal High Yield Index; Taxable Investment -Grade is represented by Barclays U.S. Credit Index; Mortgage Backed Securities is represented by Barclays U.S. Mortgage-Backed Securities Index; Short-Term Bonds is represented by Barclays U.S. Government & Credit 1-3 Year Index; Municipal Bonds is represented by Barclays Municipal Bond Index; Convertible Bonds is represented by BofA Merrill Lynch All U.S. Convertibles Index; Senior Loans is represented by Credit Suisse Leveraged Loan Index; and Preferred Stock is represented by BofA Merrill Lynch Preferred Stock Fixed Rate Index; Closed-End is represented by First Trust Composite Closed-End Fund Total Return Index (UPCEFT). An investment cannot be made directly in an index. Past performance is not a guarantee of future results. Diversification does not guarantee a profit or eliminate the risk of loss.

The following unmanaged indexes are considered representative of the indicated asset classes: Closed-end funds are represented by the First Trust Composite Closed-End Fund Total Return Index. Convertible bonds are represented by BofA Merrill Lynch All Convertibles All Qualities Index. Emerging markets debt is represented by JP Morgan GBI-EM Global Diversified Index. High-yield bonds (corporates) are represented by Barclays U.S. High Yield 2% Issuer Cap Index. High-yield bonds (municipals) are represented by Barclays High Yield Municipal Index. Mortgage-backed securities are represented by Barclays U.S. Mortgage-Backed Securities Index. Municipal bonds are represented by Barclays Municipal Bond Index. Preferred stock is represented by BofA Merrill Lynch Preferred Stock Fixed Rate Index. Senior loans are represented by Credit Suisse Leveraged Loan Index. Short-term bonds are represented by Barclays U.S. Government & Credit 1 -3 Year Index. Taxable investment-grade bonds are represented by Barclays U.S. Credit Index. An investment cannot be made directly in an index.

Investments in these strategies are subject to certain risks. There can be no guarantee any investment will be successful. Income levels and volatility will vary with market conditions. Investors should consider their own situation and risk tolerance before investing.

About risk

Fixed-income investments are subject to credit risk of the issuer and the effects of changing interest rates. Interest rate risk refers to the risk that bond prices generally fall as interest rates rise and vice versa. An issuer may be unable to meet interest and/or principal payments, thereby causing its instruments to decrease in value and lowering the issuer's credit rating.

Junk bonds involve a greater risk of default or price changes due to changes in the issuer's credit quality. The values of junk bonds fluctuate more than those of high quality bonds and can decline significantly over short time periods.

Market prices of fixed-income securities with intermediate lives generally fluctuate more in response to changes in interest rates than do market prices of municipal securities with shorter lives but generally fluctuate less than market prices of municipal securities with longer lives.

Mortgage- and asset-backed securities are subject to prepayment or call risk, which is the risk that the borrower's payments may be received earlier or later than expected due to changes in prepayment rates on underlying loans. Securities may be prepaid at a price less than the original purchase value.

Senior loans are extended by financial institutions to entities of below investment-grade credit quality and are subject to significant credit, valuation and liquidity risk.

Investments in convertible securities are subject to the risks associated with both fixed-income securities, including credit risk and interest rate risk, and common stocks.

The dollar value of foreign investments will be affected by changes in the exchange rates between the dollar and the currencies in which those investments are traded. An investment in emerging market countries carries additional risks compared with more developed economies.

Municipal securities are subject to the risk that litigation, legislation or other political events, local business or economic conditions or the bankruptcy of the issuer could have a significant effect on an issuer's ability to make payments of principal and/ or interest.

Preferred stock generally has a preference as to dividends and liquidation over an issuer's common stock but ranks junior to debt securities in an issuer's capital structure. Unlike interest payments on debt securities, preferred stock dividends are payable only if declared by the issuer's board of directors. Preferred stock also may be subject to optional or mandatory redemption provisions.