Portfolio MODELS

Strategies aligned with your goals, portfolios built with purpose, and decisions guided by data

CEF Advisors offers 17 fund models designed to address a variety of investor needs and preferences. These models provide a framework for building diversified portfolios, each representing a distinct thematic style of management. We work closely with clients to understand their objectives and risk tolerance, tailoring portfolios to align with their individual circumstances. At CEF Advisors, customization is at the core of our approach — no two client strategies are exactly alike.

We also place a strong emphasis on transparency. Clients receive detailed reporting and access to comprehensive data resources, helping them stay informed about their investments. This high level of reporting is intended to provide clients with greater insight into their portfolios and support timely, well-informed decision-making.

International Opportunities

Diversified portfolio of non-U.S. and global sector of closed-end funds. We seek to blend our global market outlook with the ability to buy funds, often at significant discounts to NAV while having the opportunity for discount narrowing over time. Yield is a byproduct of the model as many CEFs pay at least annual or semi-annual distributions. We expect the model to be 60% to 80% equity exposure and 55% to 85% non-U.S. holdings at the fund level. We seek duration of the portfolio on a “cash weighted” basis under 2 and a beta to the S&P 500 between 0.75 and 0.90.

Diversified Equity

Diversified portfolio seeking primarily equity exposure. The Beta to the S&P 500 is expected to be 0.85 to 1.15. This portfolio is expected to have little to no duration exposure.

Diversified Growth

Diversified portfolio focusing on the sectors and funds where we see the best risk-adjusted growth potential. Yield is a byproduct of the model as many CEFs pay at least annual or semi-annual distributions. We expect the model to be 65% to 90% equity exposure based on the fund’s reported holdings and seeking to have duration of the portfolio on a “cash weighted” basis around 1 and a beta to the S&P 500 between 0.70 and 1.0.

Hybrid (High) Income

Diversified portfolio seeking 50/50 allocation to equity and debt at the fund level, focusing on the highest sustainable dividend levels possible in the current environment with at least 75% of funds paying monthly. Historically 8% to 9% is our target income level. We seek to have duration of the portfolio on a “cash weighted” basis under 2 and a beta to the S&P 500 between 0.75 and 0.95. We offer a 100% monthly paying version of this model (#4.2) for investors that seek this feature to their investment needs and a tax-advantaged version of this model (#4.1).

Discount Opportunity

Diversified portfolio seeking 50/50 allocations to equity and debt at the fund level. Researching funds that have both a larger-than-average absolute discount to NAV as well as wider-than-normal comp discount (vs. peer-group average) without a significantly worse NAV total return performance vs. their peer funds. This model can work well for contrarian investors.

Alternative Income

Diversified portfolio seeking 40/60 allocation to equity and debt at the fund level, focusing on less “plain vanilla” or core sectors and managers that could offer a more “hedge fund”–like experience and a diversifier to traditional equity and bond allocations. We seek 2% a quarter in distributions at roughly half the beta to the S&P 500 during normal market conditions with “cash weighted” duration under 2. We offer a tax-advantaged version of this model (#6.1).

Foundation/Balanced

Diversified model based on a 60/40 allocation to equity and debt at the fund level. We believe this model is a “medium risk portfolio” for a typical retired investor. Historically 7% to 8% is our target income level. We seek to have duration of the portfolio on a “cash weighted” basis under 2.5 and a beta to the S&P 500 between 0.60 and 0.85. We offer a tax-advantaged version of this model (#7.1), that could reduce the after-tax friction by 65% to 75% for a typical investor in a taxable environment. We also offer a more conservative portfolio (Conservative Diversified), comprised of 2/3 the F/B model and 1/3 invested in non-traditional asset classes using ETFs and open-end funds to reduce the expected volatility over time.

Taxable Bond and BDC

Diversified portfolio focused on the taxable bond and debt-focused business development company (BDC) sectors. This income-focused model historically targets a 7% to 8% income level. It seeks “cash weighted” duration under 4 and a beta to the S&P 500 from 0.35 to 0.50.

Dividend Confidence Model

Diversified portfolio of roughly 50% equity and bond funds where we see above-average dividend coverage as the primary factor after our trifecta analysis. Historically 6.25% to 7.5% is our target income level and we expect durations under 2.5 and a beta under 0.80.

Diversified Low Beta

Diversified portfolio seeking 50/50 allocations to equity and debt at the fund level focusing on a lower beta to the S&P 500 in the sector when selecting funds. We seek to have duration of the portfolio on a “cash weighted” basis under 1.75 and a beta to the S&P 500 between 0.40 and 0.60.

Low Correlation

Diversified portfolio seeking roughly 50/50 allocations to equity and debt at the fund level. Focusing on exposure to the CEF sectors we find have the lowest long-term NAV correlations to each other. Historically 6% to 7% is our target income level. We seek to have duration of the portfolio on a “cash weighted” basis under 3.25 and a beta to the S&P 500 between 0.50 and 0.70. We offer an “IRA” version of this model (#11.1) that replaces Build America Bond (BABs) exposure for the municipal bond exposure.

Diversified Tax-Sensitive Income

Designed to maximize after-tax yield for high-income investors seeking little to no tax friction. Equal weight exposure to three CEF sectors which historically have low correlation: municipal bonds, master limited partnerships, and tax-advantage equity funds. Munis, the most common tax-avoidance sector for many investors, has a 39% 10 Year NAV correlation to MLPs and a 33% correlation to Covered Call Funds. Covered Call Funds have only a 70% correlation to MLP funds. We seek a beta to the S&P 500 of 0.55 to 0.70 and an after-tax yield of 6% to 7%. Duration is expected to be under 4. We offer a municipal bond overweight version of this model (#12.1) where 50% of the portfolio is muni bond CEFs.

Business Development Company Select

Diversified portfolio of BDCs with strong fundamental research on each BDC’s portfolio and management. Seeking BDCs exposure with above-average dividend sustainability, NAV performance, variable and senior secured loan exposure, as well as low non-accruals (defaults). We look for sector and geographic diversity. We expect a beta to the S&P 500 of 0.6 to 0.8, and historically yield levels of 8.5% to 9.5% are common. BDCs have low 10-year correlation to most asset classes, including 15% to municipal bond, 13% to preferred equity, and 27% to REITs, and only a 40% to 43% correlation to high yield and senior loans. We offer “100% monthly paying only” (#13.1), "low beta" (#13.2), and premium BDC (#13.3) versions of this model.

Municipal Bond Select

A focused portfolio managed for 100% tax-free municipal bond exposure. We seek to build and manage the portfolio for better-than-average discount to NAV, NAV total return performance, distribution levels, duration exposure, dividend coverage, and other criteria we believe can give investors a better experience when looking to allocate funds into this sector. We also offer this model with lower duration (and yield) exposure (#14.1).

CEFA Select “Six Pack” Income

This is a diversified portfolio of fund in the following six sectors: Business Development Companies (BDCs), Covered Call Funds, Loan Participation Funds, Preferred Equity Funds, REIT/ Real Asset Funds ,and Utility/Infrastructure Funds. They are expected to be weighted with a minimum allocation of 10% and maximum allocation of 20% per sector. Exposure should be at a minimum of 40% for both equity and fixed-income holdings for the underlying funds. We anticipate the yield being about 1% higher than the 12 Major Sector Index under normal market conditions.

CEFA Non-Profit Foundation Diversified Income

This portfolio model is designed to be a multi-sector, multi-manager portfolio with an emphasis on income-producing sectors and high-quality managers. The portfolio construction process seeks a mix of assets that have a peer-group correlation under 0.50 and a beta to the S&P 500 of 0.60 in normal market conditions. We expect to be able to offer a sustainable pay-out ratio of 5% to 6% based on changing market factors. It would be expected that the portfolio would have a gross distribution yield of 7.25% to 8.25% and we would expect to reinvest 1%. Fees are expected to be 0.50% to 0.85% depending on the account size. This should allow for 5.25% to 6.25% sustainable payouts in dollar terms from the account inception.

Diversified Sharia-Oriented Income

Diversified portfolio designed to be generally compliant with widely used Sharia standards while seeking an annual cash-flow target of 7.5%. The model emphasizes equity funds—primarily CEFs—complemented by ETFs where they improve diversification, liquidity, or implementation. We seek to avoid or minimize exposure to prohibited sectors (e.g., conventional banking/insurance, alcohol, gambling, pork processing, adult entertainment, tobacco, and certain weapons) and screen for balance-sheet/interest-income thresholds consistent with common Sharia methodologies. For CEFs lacking formal Sharia labels, we review look-through holdings and manager policies to reduce non-compliant revenue sources and interest income. We generally do not use option overlays unless consistent with the chosen interpretation.

We expect 80%–95% equity exposure at the underlying holdings level, with up to 0%–15% in liquidity or select “cash-equivalent/asset-backed” exposures (e.g., sukuk ETFs, if used) to manage volatility and cash flow. We emphasize managers with consistent distribution practices, target discount opportunities (absolute and relative to peers) in CEFs, and seek catalysts for discount narrowing over time. We expect little-to-no duration exposure (equity-centric) and an expected NAV beta to the S&P 500 of ~0.65–0.85 in normal conditions.

Notes: Sharia interpretations differ by scholar/board; this model follows a “generally compliant” approach and can be tightened or customized to client-specified standards. Target income is an objective and not guaranteed; distributions may vary with market conditions and portfolio changes.

Disclosures

The net returns presented for all CEFA composites have been calculated using a time-weighted return methodology. Returns are net of all dividends, interest, and income, as well as realized and unrealized gains and losses, and reflect the deduction of brokerage and custodial fees. CEFA advisory fees are disclosed in the firm's ADV Part 2. Each composite includes all actual fee-paying and family (non-fee-paying) fully discretionary accounts following the specific strategy that have been under CEFA management for at least three months.

Diversified Growth and Growth & Income Models:

As of December 31, 2025, all accounts in the Diversified Growth and Growth & Income composites are fee-paying, except for family accounts. The composite inception date is December 31, 1998. John Cole Scott has solely managed these accounts since January 1, 2014. From June 30, 2009 to December 31, 2013, accounts were co-managed by John Cole Scott and CEFA previous owner George Cole Scott. From inception through June 30, 2009, the accounts were solely managed by George Cole Scott.

International Opportunity Model:

As of December 31, 2025, all accounts in this strategy are fee-paying, except for family accounts. The International Opportunity composite (previously called International Equity and International REIT) began on October 31, 2002. John Cole Scott has solely managed the strategy since January 1, 2014. From December 31, 2010 to December 31, 2013, it was co-managed by John Cole Scott and George Cole Scott. Prior to that, George Cole Scott was the sole manager. All other CEF Advisors' Portfolio Models have been managed by John Cole Scott since their inception.

General Disclosures:

Performance results may vary between individual accounts depending on timing, cash flows, and specific portfolio holdings. Investors should not assume that past performance will indicate future results. All performance figures are unaudited and subject to revision. This information does not constitute a recommendation to buy or sell any specific security outside of a managed account relationship. CEFA reserves the right to modify investment strategies or techniques in response to changes in market conditions or client objectives. Comparisons to various indexes are provided for informational purposes only and may not be appropriate performance benchmarks for CEF Advisors strategies.

For more information, please refer to CEFA’s ADV Part 2 or contact our office at (804) 288-2482.

ALL THE MODELS ON ONE PAGE

DOWNLOAD PDF