Jan. 12, 2018

Seeking Sustainable Income

Investing for Sustainable Income in Retirement

The #1 fear of retirees is running out of income during retirement.*

In a low yield world, with costs of living and healthcare on the rise, retirees are in a unique dilemma previous generations didn’t face. The 40% bond portion of a 60/40 portfolio historically performed it’s dual role of capital preservation and income. Low yields have eroded income and if rates rise the capital preservation role of bonds will be severely challenged.


Addressing the Distribution Conundrum — While interest rates on bonds are low, even negative, global debt levels and inevitable deleveraging has many experts projecting low returns for equities going forward. In addition to this difficult investment environment, investors face various risks such as investment timing or sequence of returns risk, volatility risk, bear market risk and other risks.


How are retirees going to ensure they don’t run out of money while in distribution?


Staying Power for Retirement Assets – Remaining Invested, Withdrawing Funds, and Outpacing Inflation.


At Swan Global Investments, we believe this Distribution Conundrum is also a profound opportunity. Advisors that can provide investors with strategies that create the opportunity for asset growth and protection will solve this conundrum and be immensely rewarded.


The Swan Defined Risk Strategy (DRS) is designed to seek consistent returns, while seeking protection against major bear market losses, with a reliable performance track record since 1997.


A Complement to Fixed Income — The ‘Investing for Income’ presentation demonstrates how the DRS, by potentially generating consistent equity returns while reducing volatility and seeking bear market protection, can serve as a retirement account that can sustain systematic withdrawals.



Source: Zephyr StyleADVISOR
* Source:, October 2016
Note — All data based on the historic performance of the Swan Defined Risk Strategy Select Composite.
Important Disclosures:

Select Composite Account Disclosure Table

Swan Global Investments, LLC is a SEC registered Investment Advisor that specializes in managing money using the proprietary Defined Risk Strategy (“DRS”). SEC registration does not denote any special training or qualification conferred by the SEC. Swan offers and manages the DRS for investors including individuals, institutions and other investment advisor firms. Any historical numbers, awards and recognitions presented are based on the performance of a (GIPS®) composite, Swan’s DRS Select Composite, which includes non-qualified discretionary accounts invested in since inception, July 1997, and are net of fees and expenses. The Swan Defined Risk Strategy Select Composite demonstrates the performance of non-qualified assets managed by Swan Global Investments, LLC since inception. It includes discretionary individual accounts whose account holders seek the upside potential of owning stock, and the desire to eliminate most of the risk associated with owning stock. The Composite relies on LEAPS and other options to manage this risk. Individual accounts own S&P 500 exchange traded funds and LEAPS associated with the exchange traded funds as well as multiple other option spreads that represent other indices that are widely traded. The Defined Risk Strategy was designed to protect investors from substantial market declines, provide income in flat or choppy markets, and to benefit from market appreciation. Stock and options are the primary components of the strategy.

Swan claims compliance with the Global Investment Performance Standards (GIPS®) and has prepared and presented this report in compliance with GIPS. Swan’s compliance with GIPS has been independently verified for the periods July 1, 1997 through December 31, 2017. The Spaulding Group conducted Swan’s verification. The three-year annualized standard deviation measures the variability of the composite and the benchmarks over the preceding 36-month period. The dispersion of annual returns is measured by the standard deviation of asset-weighted portfolio returns represented within the composite for the full year. For those periods with five or fewer portfolios included for the entire year, dispersion is not presented. A copy of the verification report is available upon request. To receive copies of the report, please call (970) 382-8901 or email Verification assesses whether (1) the firm has complied with all the composite construction requirements of GIPS on a firm-wide basis, and (2) the firm’s policies and procedures are designed to calculate and present performance in compliance with GIPS. Verification does not ensure the accuracy of any specific composite presentation. All data used herein; including the statistical information, verification and performance reports are available upon request.

The S&P 500 Index is a market cap weighted index of 500 widely held stocks often used as a proxy for the overall U.S. equity market. Indexes are unmanaged and have no fees or expenses. An investment cannot be made directly in an index. Swan’s investments may consist of securities which vary significantly from those in the benchmark indexes listed above and performance calculation methods may not be entirely comparable. Accordingly, comparing results shown to those of such indexes may be of limited use. The adviser’s dependence on its DRS process and judgments about the attractiveness, value and potential appreciation of particular ETFs and options in which the adviser invests or writes may prove to be incorrect and may not produce the desired results. There is no guarantee any investment or the DRS will meet its objectives. All investments involve the risk of potential investment losses as well as the potential for investment gains. Prior performance is not a guarantee of future results and there can be no assurance, and investors should not assume, that future performance will be comparable to past performance. All investment strategies have the potential for profit or loss. Further information is available upon request by contacting the company directly at 970.382.8901 or visit