Diversified Income Fund
An actively managed fund of funds that seeks a diversified stream of income and growth utilizing a broad set of income generating securities.
Investment Strategy
The Fund seeks a high total return through the combination of income and capital appreciation. To pursue this objective, the Fund invests primarily in shares of other registered investment companies (the “underlying funds”), following an asset allocation model that is diversified among several asset classes.
Portfolio Management
Why Madison Diversified Income Fund
- Active asset allocation reflects real-time convictions
- Active risk management seeks participation in rising markets and protection of capital during downturns
- Adaptive to changing markets
Key Highlights (As of Friday May 09, 2025)
Class A |
|
NAV($) |
12.56 |
Change($) |
0.02 |
YTD(%) |
0.37% |
Ticker |
MBLAX |
Inception Date |
12/29/97 |
Expense Ratio |
1.16 |
|
Morningstar Overall Among 433 Moderate Allocation funds |
5.59%
30-day SEC Yield1,2 (Class A Shares)
18
Average years of PM industry experience
$129.2M
net assets1
Commentary
The first quarter was marked by two distinct events that brought serious questions to investors’ minds. First, was the release of the DeepSeek-R1 AI model in China in late January. The model was purportedly created at a mere fraction of the existing AI models in the United States, brining into question the hundreds of billions being spent on AI capital expenditures by the large U.S. firms, who coincidentally, are still looking for a road to realize any material revenue from said AI spending. Then, with ongoing tariff talk causing rising uncertainty among businesses and consumers alike, in an early March interview, President Trump declined to rule out a recession and spoke of a “period of transition” as his policies play out. Investors were instantly unnerved at the prospect of the Administration playing a game of chicken with the economy and our global trading partners.
Performance
| Period | MBLAX – Class A | Madison Diversified Income Bench (S&P500:50% - BAMLCorp.Govt.Mtg:50%) | ICE BofA US Corp Govt&Mor TR USD | S&P 500 TR USD |
|---|---|---|---|---|
| 1Yr | 5.74% | 10.15% | 7.98% | 12.10% |
| 3Yr | 2.13% | 7.11% | 1.86% | 12.18% |
| 5Yr | 5.91% | 7.36% | -0.77% | 15.61% |
| 10Yr | 5.85% | 7.07% | 1.53% | 12.32% |
| Since Inception | 5.71% | 6.64% | 4.03% | 8.64% |
| Period | MBLAX – Class A | Madison Diversified Income Bench (S&P500:50% - BAMLCorp.Govt.Mtg:50%) | ICE BofA US Corp Govt&Mor TR USD | S&P 500 TR USD |
|---|---|---|---|---|
| 1Yr | 4.05% | 6.72% | 4.94% | 8.25% |
| 3Yr | 0.87% | 4.90% | 0.46% | 9.06% |
| 5Yr | 7.5% | 8.92% | -0.49% | 18.59% |
| 10Yr | 5.97% | 7.12% | 1.46% | 12.50% |
| Since Inception | 5.77% | 6.67% | 4.03% | 8.69% |
Average annual returns, %
Performance quoted represents past performance. Past performance does not guarantee and is not a reliable indicator of future results. Investment returns and principal values will fluctuate so that an investor’s shares, when redeemed, may be worth more or less than the original cost. Current performance may be lower or higher than that shown.
Portfolio Highlights
Top Ten Fund Holdings (As of 04/30/25)
MADISON SHORT TERM STRATEGIC I |
22.81% |
JANUS HENDERSON MORTGAGE BACKE |
5.02% |
MADISON DIVIDEND VALUE ETF |
18.24% |
GLOBAL X MLP ETF |
3.96% |
MADISON AGGREGATE BOND ETF |
17.57% |
SCHWAB US DIVIDEND EQUITY ETF |
3.49% |
MADISON COVERED CALL ETF |
15.62% |
ISHARES 5 10 YEAR INVESTMENT G |
1.99% |
SPDR PORTFOLIO HIGH YIELD BOND |
9.92% |
JANUS HENDERSON AAA CLO ETF |
0.59% |
The Morningstar Rating™ for funds, or “star rating”, is calculated for funds with at least a three-year history. Exchange-traded funds and open-ended mutual funds are considered a single population for comparative purposes. It is calculated based on a Morningstar Risk-Adjusted Return measure that accounts for variation in a fund’s monthly excess performance, placing more emphasis on downward variations and rewarding consistent performance. The Morningstar Rating does not include any adjustment for sales loads. The top 10% of funds in each category receive 5 stars, the next 22.5% receive 4 stars, the next 35% receive 3 stars, the next 22.5% receive 2 stars, and the bottom 10% receive 1 star. The Overall Morningstar Rating for a fund is derived from a weighted average of the performance figures associated with its three-, five-, and 10-year (if applicable) Morningstar Rating metrics, and may not indicate positive performance. Ratings may vary by share class.
1 Data as of March 31, 2025.
2 SEC 30-day yield represents net investment income earned by a fund over a 30-day period, expressed as an annual percentage rate based on the fund’s share price at the end of the 30-day period. It is calculated based on the standardized formula set forth by the SEC.
Net Asset Value (NAV) is the amount per share you would receive if you sold shares that day. Change refers to the amount (in dollar terms) that the value of the share price changed from the previous day’s close of trading. The Year-to-date (YTD) return is the net change in the value of the fund’s share price (in percentage terms) at NAV from January 1 to the current date shown above. Expense ratios are as of each fund’s most recent prospectus. For more detailed information on performance, including returns for the most recent month-end or quarter-end, view Performance.
Investment returns assume all distributions are reinvested and reflect all applicable fees and expenses. Returns for Class A shares reflect deduction of the 5.75% maximum sales charge. Benchmark index returns assume all distributions are reinvested. Indexes are unmanaged and, therefore, have no fees. Investors cannot invest directly in an index.
An investment in the Fund is subject to risk and there can be no assurance the Fund will achieve its investment objective. The risks associated with an investment in the Fund can increase during times of significant market volatility. The principal risks of investing in the Fund include equity risk, capital gain realization risks to taxpaying shareholders, interest rate risk, credit risk, non-investment grade security risk, real estate investment Trust (“REITs”) risk, foreign security and emerging market risk, depository receipt risk, and market risk. Mutual funds that invest in bonds are subject to certain risks including interest rate risk, credit risk, and inflation risk. As interest rates rise, the prices of bonds fall. Long-term bonds are more exposed to interest-rate risk than short-term bonds. Investing in non-investment grade securities, may provide greater returns but are subject to greater-than-average risk. More detailed information regarding these risks can be found in the Fund’s prospectus.
Patrick Ryan and Stuart Dybdahl assumed management of the Fund on July 31, 2023.
Data prior to July 31, 2023 represents the performance of the previously portfolio management team of Madison, who used a differed principal investment strategy to achieve the Fund’s investment objective.
The Fund’s investment strategy reflects Madison’s general “Participate and Protect®” investment philosophy. Madison’s expectation is that investors in the Fund will participate near fully in market appreciation during bull markets and experience something less than full participation during bear markets compared with investors in portfolios holding more speculative and volatile securities. Therefore, the Fund’s investment philosophy is intended to represent a conservative investment strategy. There is no assurance that Madison’s expectations regarding this investment strategy will be realized.
The S&P 500® Index is a large-cap market index which measures the performance of a representative sample of 500 leading companies in leading industries in the U.S.
The ICE BofA U.S. Corporate, Government & Mortgage Index is a broad-based measure of the total rate of return performance of the U.S. investment grade bond markets. The index is a capitalization-weighted aggregation of outstanding U.S. treasury, agency and supranational mortgage pass-through, and investment grade corporate bonds meeting specified selection criteria.
The Diversified Income Fund Custom Index consists of 50% S&P 500® Index and 50% ICE BofA U.S. Corporate, Government & Mortgage Index. The custom index is calculated using a monthly re-balancing frequency (i.e., rebalanced back to original constituent weight every calendar month-end).
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