Bay Capital Programs

BC Allocation – Strategic Income Programs

Objective: The BC Allocation – Strategic Income Programs are managed income programs
that started in January 2012 with goals of earning above-average income and total return.
The foundation of these strategies is rotation between broadly different bond categories as a
way to both improve income and control risk as market characteristics change. The three
distinct strategic income programs with different risk profiles are:

  • Strategic Cash Management (SCM)
  • Strategic Income Conservative (SI-C)
  • Strategic Income (SI)

Management: The three BC Allocation – Strategic Income Programs monitor and rank over
100 funds, eliminating under-performing investments and adding those showing superior
relative strength, using a rules-based strategy. Strategy highlights:

  • The main investment categories include: corporate, high yield, municipal, mortgage-backed, bank loan and multi-sector, plus short-term Treasury funds on occasion. 
  • The fund universe monitored includes bond sectors/strategies that tend to have higher yields when compared to the benchmark. v Multiple positions may be held, in unequal weightings, based on a fund's risk statistics, with holding periods of months to years.
  • The strategies can be tailored to a client's risk tolerance. 
  • Suitable for retirement income or as a diversification for bond or stock portfolios.

We pay close attention to the macro-economic trends, credit quality, interest rates and
general economic conditions. In addition to striving to be invested in the strongest
categories, we also have the option to shorten maturities or to move to the safety of shortterm
bond funds or Treasury funds in periods of broad market weakness.


Account Minimum: $100,000
Fee Schedule:

Account Value                         Annual Fee (Not To Exceed)

Up To $1,000,000 ....................... 1.00%

Over $1,000,000 ..........................0.75% 

Key Benefits: Bond market returns with below-average risk


BC Allocation – Moderate Allocation Program

Objective: The BC Select Advisors – Moderate Allocation Program has an investment objective of moderate growth.  This Program primarily seeks to invest in stock, bond and sector mutual funds.  Varying asset classes may be added to construct a “portfolio of portfolios.”  At times, mutual funds are exchanged to money market mutual funds or bond funds in times of market weakness, based on disciplined rules-based strategies.

Management: With the BC Select Advisors – Moderate Allocation Program, we select independent third-party managers that conform to strictly objective, rules-based strategies whose goals mirror and complement other Bay Capital strategies.  The manager selection process is based on: (i) investment style and performance; (ii) complementary allocation with other managers in the Program; (iii) volatility and the managers' ability to perform their assigned skill within different market trends.  The weighting for different managers, including the addition and removal of managers, occurs as the individual manager's performance dictates. 


Account Minimum: $100,000
Fee Schedule:

Account Value                         Annual Fee (Not To Exceed)

Up To $1,000,000 ....................... 2.00%

Over $1,000,000 .......................... 1.75% 

Key Benefits: Moderate growth return expectation with below-average risk. 


BC Select Advisors – Growth Program

Objective: The BC Select Advisors – Growth Program has an investment objective of growth. It is a strategy designed to maximize risk-adjusted returns in both bull and bear market cycles and to provide a low correlation to a traditional growth portfolio.  This strategy may be more aggressive because of the possible use of leveraged mutual funds.  Portfolios could theoretically be net long market indexes by as much as 110% in the rare situation when all of the Select Advisor strategies are signaling to be fully invested concurrently and were fully leveraged.  Historically, this has been rare, but it has occurred and will probably occur in the future for short periods of time.  This factor increases risk and should be considered before investing in this Program.

Management: With the BC Select Advisors – Growth Program, we may select independent third-party managers.  The manager selection process is based on: (i) investment style and performance; (ii) complementary allocation with other managers in the Program; (iii) levels of volatility and the managers' ability to perform their assigned skill within different market trends.  The weighting for different managers, including the addition and removal of managers, occurs as the individual manager's performance dictates.  Outside managers are compensated based on the total Program's assets that we have allocated to that manager, ranging between 0.50% and 1.00% of assets annually.

Account Minimum: $100,000
Fee Schedule:

Account Value                         Annual Fee (Not To Exceed)

Up To $1,000,000 ....................... 2.25%

Over $1,000,000 ..........................2.00% 

Key Benefits: Both tactical and sector allocation strategies that can provide non-correlated returns including the ability to benefit from falling as well as rising markets.  This strategy has the ability to completely exit the market in periods of weakness and to be aggressively long when markets are moving higher.