| ANNUALIZED SINCE INCEPTION | QUARTERLY | YTD |
|---|---|---|
| 5.74% | 0.73% | 0.73% |
Easterly Income Opportunities Fund returned 0.73% net in Q1 2026, outperforming the Bloomberg U.S. Aggregate Bond Index by 78 basis points. Geopolitical events dominated markets as a major U.S.-Israeli operation targeting Iran's leadership triggered energy price surges from $60 to over $100 per barrel, raising inflation concerns and pressuring both stocks and bonds in March. The fund maintained elevated liquidity with cash and Treasuries at 18% while continuing to move assets from CMBS to higher-quality RMBS. All portfolio sectors contributed positive returns despite curve flattening, with the fund's low duration and 200+ basis point yield advantage supporting performance. Looking ahead, the manager expects a single Fed rate cut in H2 2026 as energy-driven inflation is treated as transitory. They remain constructive on non-agency RMBS supported by strong demand and potential Basel III tailwinds, selective on CMBS given office sector stress, and see attractive value in seasoned ABS and CMS floaters offering elevated carry and diversification benefits.
The fund focuses on structured credit opportunities across RMBS, CMBS, ABS, and corporate structured notes, maintaining elevated liquidity while selectively positioning in higher-quality securities that benefit from improving technicals and attractive relative value in a volatile rate environment.
Constructive on non-agency RMBS particularly in senior and seasoned subordinate tranches supported by strong investor demand and favorable technicals. Selective within CMBS given ongoing fundamental pressures especially in office sector. Spread widening has improved relative value across ABS sectors. Attractive relative value seen in CMS spread floaters offering elevated carry and diversification benefits.
| Date | Letter | Tickers | Keywords | Pitches | Quick Takes |
|---|---|---|---|---|---|
| May 4 2026 | 2026 Q1 | - | ABS, CMBS, credit, fixed income, interest rates, RMBS, Structured Credit | - | Easterly's structured credit fund outperformed by 78bps in volatile Q1 as geopolitical events drove oil from $60 to $100+ and pressured markets. Fund maintains high liquidity while rotating from CMBS to higher-quality RMBS. Constructive outlook on non-agency RMBS with Basel III tailwinds, selective on CMBS given office stress, attractive value in seasoned ABS. |
| Feb 10 2026 | 2025 Q4 | JSVIX | CMBS, credit, fixed income, rates, RMBS, Spreads, Structured Notes | - | Easterly Income Opportunities Fund outperformed in Q4 2025 on curve steepening benefiting Corporate Structured Notes. The fund is increasing credit quality while maintaining constructive outlook on structured credit markets. Core thesis remains longer-term curve steepening with Fed rate cuts expected in 2026, creating attractive opportunities across RMBS, select CMBS, and high-multiple structured notes. |
| Nov 7 2025 | 2025 Q3 | JSVIX | ABS, CMBS, Credit Risk, Fed policy, fixed income, RMBS, Structured Credit, yield curve | - | Easterly's structured credit fund delivered steady returns in Q3 2025 despite market calm. Strong RMBS fundamentals and selective CMBS opportunities offset ABS sector stress from fraud concerns. Conservative positioning with 20% cash provides flexibility for future dislocations while maintaining competitive income through senior tranches across mortgage and asset-backed securities. |
| Jul 30 2025 | 2025 Q2 | ASML, HD, INPST.L, MELI, META, NIO, NU, SE, UBER | Autonomous Vehicles, E-Commerce, global, growth, semiconductors, technology |
UBER INPST.L SE ASML |
Exceptional Q2 performance of +20.4% driven by concentrated technology growth positions including Uber, MercadoLibre, and Sea Limited. Manager added to high-conviction names like Uber and InPost while maintaining cautious cash position above 4%. Focus remains on undervalued companies with strong execution and structural advantages, particularly in autonomous vehicles, e-commerce logistics, and semiconductors. |
| May 7 2025 | 2025 Q1 | ABBV, AMZN, ASML, INPST, MELI, META, MSFT, NIO, NU, SE, TSM, UBER, V | AI, E-Commerce, global, growth, Quality, semiconductors, technology |
ASML META SE NU |
Portfolio outperformed with +1.2% vs S&P -4.6% in Q1 by focusing on quality businesses like ASML, Meta, and Sea Limited. Manager opportunistically added to positions during corrections while maintaining disciplined approach. Strong performance from semiconductor and AI-exposed names offset broader market volatility, demonstrating resilience of concentrated quality strategy. |
| Mar 16 2025 | 2024 Q4 | - | - | - | |
| Oct 24 2024 | 2024 Q3 | - | - | - | |
| Aug 9 2024 | 2024 Q2 | - | - | - | |
| Feb 29 2024 | 2023 Q4 | ELUT, MDXH, XERS, ZETA | AI, Diagnostics, growth, healthcare, Pharmaceuticals, Rate Cuts, small caps |
MDXH XERS ZETA ELUT |
Small-cap growth manager outperformed benchmarks with +18-25% Q3 returns, focusing on healthcare overweight for offensive growth and defensive positioning. Key holdings include prostate diagnostics, specialty pharma, and marketing technology companies trading at discounted valuations. Expects Fed rate cuts to benefit small caps while remaining skeptical of AI infrastructure spending levels. |
| QUARTER | THEMES | TAGS |
|---|---|---|
| 2026 Q1 |
MortgageNon-agency RMBS issuance increased 50% year-over-year to $69 billion, driven by non-QM loans and home equity products. Strong investor demand early in quarter with heavy interest in new deals, though spreads widened modestly in March amid broader market volatility. Proposed Basel III revisions could increase bank demand and provide meaningful tailwind. |
RMBS Non-QM HELOC Basel III Securitization |
Commercial Real EstateCMBS issuance reached $47 billion with activity led by single-asset, single-borrower transactions. Office sector faces ongoing challenges with higher vacancy rates, increased delinquencies, and loss severities approaching 100% in some liquidations. Market reflects bifurcated environment with stability in stronger segments and stress in weaker areas. |
CMBS SASB Office Delinquencies Real Estate | |
RatesFed expected to deliver single 25bp rate cut in second half of 2026, treating current energy-driven inflation shock as transitory. Incoming Fed Chair Kevin Warsh emphasizes AI-driven productivity gains and supply-side expansion as structural disinflationary forces. Continued divergence expected across yield curve with front end benefiting from easing expectations. |
Fed Rate Cuts Inflation Yield Curve Monetary Policy | |
OilOil prices surged from around $60 to over $100 per barrel following major U.S. and Israeli military operation targeting Iran's leadership that disrupted key energy infrastructure and shipping routes. Spike in energy costs raised concerns about slower economic growth combined with higher inflation, pressuring both stocks and bonds in March. |
Energy Geopolitical Iran Supply Disruption Inflation | |
AIIncoming Fed Chair Kevin Warsh has consistently highlighted productivity gains from artificial intelligence as key structural disinflationary forces. AI-driven productivity gains are viewed as supporting economic growth and helping offset inflationary pressures from other sources. |
Productivity Disinflationary Technology Economic Growth | |
| 2025 Q4 |
AIManager believes market's assessment of AI risk differs from their own, with approximately 60% of relative underperformance attributed to positions where market deemed companies AI-losers. Portfolio companies like Gartner, CoStar, Clearwater Analytics, FactSet, MSCI, and Guidewire represent 42% of portfolio and declined 15% despite 10% revenue growth and 15% EPS growth. Manager remains optimistic about these companies' vast addressable markets and competitive advantages. |
Artificial Intelligence Disruption Valuation Software Analytics |
QualityFund exclusively invests in businesses with superior characteristics including high barriers to entry, sustainable competitive advantages, and durable secular tailwinds. Manager notes their practice of owning high-quality investments has been primary driver of long-term outperformance but was out of favor in 2025 as investors sold higher-quality investments to buy riskier stocks. MSCI Barra data shows Earnings Quality factor was in 100th percentile during nine-month period ended December 8, 2025. |
High Quality Competitive Advantages Earnings Quality Barriers to Entry | |
Small CapsFund's strategy of owning competitively advantaged small and medium-sized businesses remained out of favor for most of the quarter. Manager observed improvement in early December as investors showed renewed enthusiasm for high-quality stocks that exclusively populate the fund. Fund has meaningfully outperformed Russell 2000 Growth Index over long term with 11.62% annualized returns since inception versus 8.08% for benchmark. |
Small Cap Growth Russell 2000 Outperformance | |
FinancialsFinancials represent 62.1% of net assets and contributed -0.47% to quarterly returns. Notable holdings include Arch Capital Group (17.5% of assets), MSCI Inc. (17.3%), and Kinsale Capital Group (9.1%). Arch Capital contributed positively with 5.74% return on strong earnings and active capital management, while Kinsale declined on concerns about moderating growth amid cyclical slowdown for property and casualty insurance industry. |
Insurance Specialty Finance Capital Markets Asset Management | |
| 2025 Q3 |
MortgageNon-Agency RMBS remains one of the strongest areas within structured credit, benefiting from healthy housing market fundamentals, limited new supply, and attractive yields. New issuance reached $161 billion through Q3 2025, matching all of 2024. Credit performance remains stable with low loss severities at 26%. |
RMBS Housing Credit Yields Issuance |
Commercial Real EstateCMBS market shows contrasts between recovering sectors and struggling office properties. Refinancing success rate improved to 73% overall but office loans remain weak at 40%. Office loan delinquencies stand at 14% with loss severities at 60%. Private CMBS issuance reached $116 billion, up 41% from 2024. |
CMBS Office Refinancing Delinquencies Distress | |
Credit StressTricolor Holdings bankruptcy exposed large-scale fraud in subprime auto ABS market, with 40% of loans double-pledged. Subprime auto credit shows broader weakness with net losses at 9.33% and delinquencies at 6.43% near record highs. Growing divergence between prime and subprime consumer credit performance. |
Subprime Auto Fraud Delinquencies Losses | |
RatesFed delivered first rate cut of 2025 in September, trimming rates by 0.25% as risk-management move. Treasury yields declined with 10-year ending at 4.15%. Yield curve steepened by 13bps between 2s and 30s. Expectations for further Fed cuts increased with quantitative tightening nearing end. |
Fed Cuts Yields Curve Steepening | |
| 2025 Q2 |
E-commerceInPost is disrupting European e-commerce logistics with its locker network expansion. The UK expansion is showing strong execution with major partnerships like Debenhams Group, handling up to £1.8 billion in gross merchandise volume. |
Logistics Europe Lockers Delivery |
Autonomous VehiclesUber is positioned to benefit from autonomous vehicle industry fragmentation. Volkswagen's white-label robotaxi partnership demonstrates how manufacturers want to focus on vehicle production while leaving fleet management to Uber's distribution network. |
Robotaxis Fleet Management Distribution Partnerships | |
SemiconductorsASML is positioned for an AI-fueled rebound with surging demand for EUV and High-NA tools. S&P Global projects revenue growth from €32 billion in 2025 to €52 billion by 2030, potentially reaching EPS of over €50. |
EUV AI Lithography Equipment | |
| 2025 Q1 |
SemiconductorsASML maintains its monopoly in lithography equipment despite Chinese competition concerns. TSMC's $100 billion U.S. investment will drive demand for more ASML machines. Reports of Chinese EUV development remain unconfirmed with limited transparency about reliability. |
ASML Lithography EUV TSMC Manufacturing |
AIMeta is identified as one of the few companies already seeing tangible benefits from AI investments. The manager views Meta as a high-quality business benefiting from AI despite recent market correction. |
Meta Technology Investment Benefits | |
E-commerceSea Limited has performed exceptionally well and remains immune to U.S. tariff concerns. All three business segments are now profitable and self-sufficient while continuing to accelerate revenue growth. |
Sea Growth Profitability Segments | |
| 2023 Q4 |
HealthcareManager has shifted portfolios toward an overweight in healthcare, viewing it as both offensive and defensive. Offensive due to new products addressing large market opportunities, defensive due to nondiscretionary nature and lower economic sensitivity. Pharmaceuticals are specifically highlighted for novel therapies addressing large markets. |
Pharmaceuticals Diagnostics Medical Devices Biotechnology Specialty Pharma |
AIManager discusses the massive investments by tech giants in AI infrastructure and training models, comparing current partnerships to dot-com era vendor financing. While acknowledging AI will increase productivity long-term, expresses skepticism about current expectations and notes the absence of a killer app demonstrating high ROI. |
Cloud Data Centers Enterprise Software Semiconductors | |
Small CapsManager focuses on small and mid-cap stocks trading at 16x earnings, considerably less than large-cap valuations. Believes small companies historically outperform during rate cutting cycles and sees opportunities in active stock selection versus passive indexing in this environment. |
Value Growth Quality |
| Date | Pitch Type | Author | Ticker | Company | Industry | Sub Industry | Bull / Bear | Exchange | Keywords | Action |
|---|---|---|---|---|---|---|---|---|---|---|
| Jul 2, 2025 | Fund Letters | Easterly - Income Opportunities Fund | UBER | Uber Technologies Inc | Consumer Discretionary | Internet & Direct Marketing Retail | Bull | NYSE | autonomous vehicles, distribution network, growth, Mobility Services, platform, Ride Sharing, robotaxi, technology | Login |
| Jul 2, 2025 | Fund Letters | Easterly - Income Opportunities Fund | INPST.L | InPost SA | Industrials | Air Freight & Logistics | Bull | LSE | Disruptor, E-commerce logistics, European expansion, Last-mile Delivery, Parcel Lockers, Reinvestment runway, UK market, Value | Login |
| Jul 2, 2025 | Fund Letters | Easterly - Income Opportunities Fund | SE | Sea Limited | Communication Services | Interactive Media & Services | Bull | NYSE | Digital Entertainment, e-commerce, Fintech, Gaming, growth, margin expansion, revenue acceleration, Southeast Asia | Login |
| Jul 2, 2025 | Fund Letters | Easterly - Income Opportunities Fund | ASML | ASML Holding NV | Information Technology | Semiconductors & Semiconductor Equipment | Bull | NASDAQ | AI, Cyclical, Euv, High NA, Lithography, Monopoly, Netherlands, semiconductors, Value | Login |
| Apr 1, 2025 | Fund Letters | Easterly - Income Opportunities Fund | ASML | ASML Holding N.V. | Information Technology | Semiconductors & Semiconductor Equipment | Bull | NASDAQ | China, Euv, geopolitical, Lithography, Manufacturing Equipment, Monopoly, semiconductors, technology, TSMC | Login |
| Apr 1, 2025 | Fund Letters | Easterly - Income Opportunities Fund | META | Meta Platforms Inc. | Communication Services | Interactive Media & Services | Bull | NASDAQ | Artificial Intelligence, High quality, market correction, social media, technology, valuation | Login |
| Apr 1, 2025 | Fund Letters | Easterly - Income Opportunities Fund | SE | Sea Limited | Communication Services | Interactive Media & Services | Bull | NYSE | Digital Financial Services, Diversified, e-commerce, Gaming, profitability, Southeast Asia, Tariff Immunity | Login |
| Apr 1, 2025 | Fund Letters | Easterly - Income Opportunities Fund | NU | Nu Holdings Ltd. | Financials | Consumer Finance | Bull | NYSE | Brazil, Credit risk, Currency, digital banking, Emerging markets, Fintech, valuation | Login |
| Sep 30, 2025 | Fund Letters | Easterly - Income Opportunities Fund | MDXH | MDxHealth | Health Care | Health Care Equipment & Supplies | Bull | NASDAQ | Biotech, diagnostics, growth, healthcare, Medical devices, Prostate Cancer, Value | Login |
| Sep 30, 2025 | Fund Letters | Easterly - Income Opportunities Fund | XERS | Xeris Pharmaceuticals Inc. | Health Care | Pharmaceuticals | Bull | NASDAQ | Biotech, Cushing's Syndrome, growth, healthcare, pharmaceuticals, rare disease, Specialty pharma | Login |
| Sep 30, 2025 | Fund Letters | Easterly - Income Opportunities Fund | ZETA | Zeta Global Holdings Corp. | Communication Services | Interactive Media & Services | Bull | NYSE | advertising technology, Artificial Intelligence, digital marketing, growth, Martech, Software, Value | Login |
| Sep 30, 2025 | Fund Letters | Easterly - Income Opportunities Fund | ELUT | Elutia Inc. | Health Care | Health Care Equipment & Supplies | Bear | NASDAQ | Biotech, Cardiac Devices, healthcare, Management Risk, Medical devices, value destruction | Login |
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