NEW YORK, NY -- Foresters Financial, an international financial services providers, announced today the launch of the First Investors Premium Income Fund (Class A: FPIKX, Advisor: FPILX and Institutional: FPIMX). The Fund is unique in the open-end mutual fund industry as it sells in-the-money call options against a portfolio of high-quality, high-conviction large-cap equities, essentially trading the potential upside of capital appreciation of a stock for current income while seeking some downside protection. Its investment objective is to generate income for its shareholders.
“The Fund is designed to deliver stable returns in a volatile world. With bond yields at historic lows, the First Investors Premium Income Fund may have a dual purpose: helping to capture income and protect investors’ portfolios at the same time,” according to Wiley Angell, Senior Portfolio Manager, Ziegler Capital Management, LLC, the Fund’s subadviser.
The First Investors Premium Income Fund aims to achieve its investment goal without some of the risks of holding a bond fund since the Fund’s equity securities do not have significant credit risk or duration risk—and are better insulated from the potential impact of rising interest rates. Also, the Fund can mitigate equity-related risk due to the premiums the portfolio managers expect to receive on in-the-money covered calls. Today, for many investors worried about finding a steady income source, especially amidst uncertain and at times, unstable, financial markets, we feel that the First Investors Premium Income Fund may offer a potential solution.