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| Quarter | Letter Date | Fund Name | QTD | YTD | Tickers | Themes | Quick Take |
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"FPA New Income Fund returned a strong 7.36% in 2025 and is maintaining a highly cautious, contrarian stance by avoiding expensive corporate credit in favor of liquid, high-quality Treasuries and Agency bonds."
In Q4 2025, the FPA New Income Fund returned 1.15%, finishing the calendar year up 7.36%. Amid extremely compressed credit spreads and divided Federal Reserve rate-cut decisions, Portfolio Manager Abhijeet Patwardhan has adopted a highly cautious, contrarian stance. The fund made no new credit investments (rated BBB or lower) during the quarter, viewing them as overpriced, and instead increased cash reserves to 9.1% and allocated heavily to High Quality assets such as Treasuries and Agency RMBS. The fund is proactively managing duration using a '100 bps duration test' to ensure that selected bonds can withstand a substantial yield hike without resulting in capital loss, maintaining a posture focused on long-term downside protection and opportunistic deployment.
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Algorithmic conviction, macroeconomic posture, and risk appetite signals extracted from this quarterly letter with qualitative explanations.
Market Conviction
High-conviction positioning: FPA New Income Fund returned a strong 7.36% in 2025 and is maintaining a highly cautious, contrarian stance by avoiding expensive corporate credit in favor of liquid, high-quality ...
Growth Outlook
Market outlook remains low conviction: FPA New Income Fund returned a strong 7.36% in 2025 and is maintaining a highly cautious, contrarian stance by avoiding expensive corporate credit in favor of liquid, high-quality ...
Risk Appetite
Risk appetite posture is low conviction: FPA New Income Fund returned a strong 7.36% in 2025 and is maintaining a highly cautious, contrarian stance by avoiding expensive corporate credit in favor of liquid, high-quality ...
Capital Deployment
Manager actively deployed capital into high-conviction opportunities. FPA New Income Fund returned a strong 7.36% in 2025 and is maintaining a highly cautious, contrarian stance by avoiding expensive corporate credit in favor of liquid, high-quality ...
Forward Guidance
Forward guidance signal: FPA New Income Fund returned a strong 7.36% in 2025 and is maintaining a highly cautious, contrarian stance by avoiding expensive corporate credit in favor of liquid, high-quality ...
Language Signal
Tone analysis indicates above average conviction language: FPA New Income Fund returned a strong 7.36% in 2025 and is maintaining a highly cautious, contrarian stance by avoiding expensive corporate credit in favor of liquid, high-quality ...
Perceived Risk
Perceived risk level is evaluated as high conviction. FPA New Income Fund returned a strong 7.36% in 2025 and is maintaining a highly cautious, contrarian stance by avoiding expensive corporate credit in favor of liquid, high-quality ...
Opportunity Density
Opportunity density index indicates low conviction actionable entry points. FPA New Income Fund returned a strong 7.36% in 2025 and is maintaining a highly cautious, contrarian stance by avoiding expensive corporate credit in favor of liquid, high-quality ...
Time Horizon
Investment time horizon reflects a above average conviction orientation. FPA New Income Fund returned a strong 7.36% in 2025 and is maintaining a highly cautious, contrarian stance by avoiding expensive corporate credit in favor of liquid, high-quality ...
