Model Portfolio for Income Investors, October 2025

This model portfolio is designed for investors seeking income, either for retirement or immediate withdrawal. It combines the best ideas from BDCs, MLPs, CEFs, option income funds, and REITs. The portfolio aims to provide a stable source of income for investors.

Investors seeking a stable source of income, whether for retirement or immediate withdrawal, can benefit from a diversified portfolio that combines the best ideas from Business Development Companies (BDCs), Master Limited Partnerships (MLPs), Closed End Funds (CEFs), option income funds, and Real Estate Investment Trusts (REITs). This model portfolio is designed to provide a consistent income flow, adjusted for inflation, and includes a mix of monthly and quarterly distributions.

Key Components of the Model Portfolio

1. Business Development Companies (BDCs)
- Ares Capital Corp. (ARCC) offers a quarterly dividend with a 9.76% yield and a 10-year total return of 229% Model Portfolio For Income, October 2025^[1].
- FIDUS Investment (FDUS) stands out with a 11.35% yield and a 10-year total return of 315% Model Portfolio For Income, October 2025^[1].
- Kayne Anderson BDC, Inc. (KBDC) provides a 11.79% yield and is known for its conservative lending standards Model Portfolio For Income, October 2025^[1].

2. Bond Funds
- Ares Dynamic Credit Allocation Fund, Inc. (ARDC) offers a monthly dividend with a 9.81% yield and a 72% 5-year total return Model Portfolio For Income, October 2025^[1].
- PIMCO Dynamic Income Opportunities Fund (PDO) pays a monthly distribution with a 10.82% yield Model Portfolio For Income, October 2025^[1].
- PIMCO Income Strategy Fund II (PFN) has a monthly distribution with an 11.28% yield Model Portfolio For Income, October 2025^[1].
- Cohen & Steers Tax-Advantaged Preferred Securities and Income (PTA) offers a 7.84% yield and a -3.48% discount to NAV Model Portfolio For Income, October 2025^[1].
- Western Asset Diversified Income Fund (WDI) provides a 11.9% yield and pays distributions monthly Model Portfolio For Income, October 2025^[1].

3. Master Limited Partnerships (MLPs)
- Enterprise Products Partners L.P. Common Units (EPD) offers a 6.89% distribution yield and a 5-year gain of +84% Model Portfolio For Income, October 2025^[1].
- MPLX LP Common Units (MPLX) provides a 7.83% distribution and a 5-year price increase of +179% Model Portfolio For Income, October 2025^[1].
- FT Energy Income Partners Enhanced Income ETF (EIPI) offers a 8.7% yield and monthly distributions Model Portfolio For Income, October 2025^[1].

4. Dividend Income Funds
- BlackRock Health Sciences Trust (BME) yields 8.28% with monthly distributions and trades at a -8.26% discount to NAV Model Portfolio For Income, October 2025^[1].
- Eaton Vance Tax-Advantaged Dividend Income Fund (EVT) offers an 8.0% annual dividend yield and a 10-year total return of +182% Model Portfolio For Income, October 2025^[1].
- Eaton Vance Tax-Advantaged Global Dividend Opportunities Fund (ETO) provides a 7.42% forward yield and a 10-year total return of 196% Model Portfolio For Income, October 2025^[1].

Conclusion

This model portfolio is designed to provide a stable source of income for investors, combining the strengths of various income-generating assets. By diversifying across BDCs, bond funds, MLPs, dividend income funds, and REITs, the portfolio aims to mitigate risks associated with overreliance on a single income source. Investors should consider their individual risk tolerance and financial goals when constructing their own income-focused portfolios.

References

Model Portfolio For Income, October 2025^[1] Seeking Alpha. (2025). Model Portfolio for Income - October 2025. Retrieved from https://seekingalpha.com/article/4828979-model-portfolio-for-income-october-2025