In 2004, Madison Investments sub-advised the first closed-end covered call fund to trade on the New York Stock Exchange. Since then, Madison has been at the forefront of covered call portfolio management, and has maintained a consistent investment philosophy that concentrates on long-term prospects rather than the empty highs of instant gratification.
Our dividend income and value strategies seek long-term outperformance by investing in stocks that have sustainable competitive advantages and fit into one of two distinct profiles. Stocks that combine rising return on invested capital (ROIC) and an opportunistic valuation are ideally suited for the value portfolio: those with an attractive relative yield and a long dividend paying history are candidates for the dividend income strategy.
The dividend income and value investment philosophies result in concentrated portfolios (typically 30-55 holdings) whose high active share reflects our portfolio managers' willingness to stand apart from market indices.
Ray Di Bernardo, CFA, serves as a portfolio manager on Madison's covered call strategies.
John Brown, CFA, serves as a portfolio manager on Madison's dividend income and value strategies.
Drew Justman, CFA, serves as a portfolio manager on Madison's covered call, dividend income and value strategies.
The writer of a covered call option forgoes, during the option’s life, the opportunity to profit from increases in the market value of the security covering the call option above the sum of the premium and the strike price of the call, but retains the risk of loss should the price of the underlying security decline.