Northern Oak Capital Management, Inc. (NOCM) manages fixed income portfolios and the fixed income portion of balanced portfolios with the following guidelines as the basis of our fixed income philosophy:

1. Preserve capital - risk taking in the fixed income markets is not rewarded or compensated in the same relationship as risk taking is in the equity markets. Safety of principal is paramount.
2. Provide a reliable stream of income consistent with rates available in the markets commensurate with safety of principal and in as tax efficient mode as possible.
3. Maintain a portfolio with minimum volatility. Fixed income securities, in our view, are meant to be anchors in a portfolio, not sails.

These guidelines translate into the following general fixed income portfolio characteristics :

• Duration of maturity distribution consistent with a client's risk parameter or time horizon
  
• Broad diversification across market sectors
  
  • U.S. Treasury and Agency Debt
    
  • U.S. Corporate Debt
  • TIPs - both U.S. and international
    
  • Municipal Bonds
  • Emerging Market Debt
  • High-Yield Securities
  • Build America Bonds
  • Convertible Debt
  • Preferred Stocks
• Tax efficiency - achieve highest after tax return based on a client's tax situation
• Maintain a high degree of liquidity