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There is a corner of the fixed income market that most investors have never heard of and will never encounter through a standard brokerage screen.

It does not show up in bond index funds. It does not appear in most income ETFs.

The Wall Street research machine largely ignores it because the issuers are too small to generate meaningful banking fees and too obscure to attract generalist analyst coverage.

It is the subordinated debt and preferred stock market for community banks and regional financial institutions, a niche sector characterized by modest deal sizes, limited secondary market liquidity, and yields that compensate handsomely for both the complexity and the illiquidity premium embedded in the paper.

One company has built its entire business model around understanding this corner of the market better than anyone else. Their closed-end fund, which we're adding to the Income Portfolio today, is the purest publicly accessible vehicle for investing in that market. It has been paying distributions monthly without interruption since inception, and as of the end of February 2026 carries a distribution rate of 10.5% on market price with a 30-day SEC yield of 6.13% unsubsidized.

It is trading at a meaningful discount to net asset value.

The portfolio management team delivered double-digit total returns in 2025 and conducted a rights offering that was oversubscribed, deploying the fresh capital into higher-coupon bank debt at what they described as a favorable market backdrop.

To see what this new 10.5%-yielding closed-end fund is, and to gain access to the full Alternative Income Portfolio, click here.

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