FPA New Income, Inc.


The primary investment objective of FPA New Income, Inc. (FPNIX) is current income and long-term total return. Capital preservation is also a consideration.

FPA New Income, Inc. seeks to generate a positive absolute return through a combination of income and capital appreciation. To achieve this goal, we employ a total return strategy using  investments in fixed income securities that focus on income, appreciation and capital preservation. Market opportunity will dictate emphasis across these three areas.



We do not like to lose money!

In order to do this we adhere to the following principles:

Absolute value investors. We seek genuine bargains rather than relatively attractive securities.

Absolute Return. We are absolute return investors and each investment must meet our strict fundamental research and macroeconomic criteria, not just offer opportunity relative to other alternatives.

Long-term Focus. Our investment time horizon is usually three to five years. We expect to hold our investments to maturity unless fundamental valuation parameters change. We are not speculators and adhere to a strict investment discipline.

Alignment of Interest. We invest alongside you as partners in our process. As managers we have significant amounts of our own capital invested in this strategy.

Strict Risk/Reward Parameters. We like to invest when there is a target rich environment. Risk of loss is a critical element in our thinking and thus, each investment must compensate for its unique risks, combined with a margin of safety.

Independent Decision Making. We do not follow the crowd. As we are independent in our decision making, we are often viewed as contrarian in our strategy and execution.

Flexible Mandate. We do not bind ourselves to any one benchmark or index. We believe this flexibility provides a competitive advantage over those who do not have this capability. This has been a critical element in achieving our goal.

For additional information, please reference the Absolute Fixed Income Policy Statement.

Portfolio Structure *

$5.3 Billion

1.80 Years
1.30 Years

Ratings Allocation*

Top Holdings*

Reynolds Group Issuer LLC      
  1.4%   Capital one Multi Asset 2014-2A

Federal National Mortgage Association 2016-66 CL JA
  1.1%   New Residential Advance 2015-T3 AT3

Enterprise Fleet Financing LLC 2015-2 A2
  1.1%   Cabela's Master Credit Card  Trust 2012-2A A1
Puerto Rico Commonwealth Aquaduct
  1.1%   COMM Mortgage Trust 2012-9W57 A
GE Capital Credit Card Master Note Trust 2012-6 A

  1.1% Santander Drive Auto Receivables Trust 2015-2 A3

Excludes U.S. Treasuries
Top Holdings represent 10.9% of Total Net Assets

Portfolio Holdings

* As of December 31, 2015. Portfolio composition will change due to ongoing management of the funds.  References to individual securities or sectors are for informational purposes only and should not be construed as recommendations by the Funds, Advisor or Distributor.

Past performance is not indicative of future performance.  Barclays Aggregate Index provides a measure of the performance of the U.S. investment grade bonds market, which includes investment grade U.S. Government bonds, investment grade corporate bonds, mortgage pass-through securities and asset-backed securities that are publicly offered for sale in the United States.  The securities in the Index must have at least 1 year remaining in maturity.  In addition, the securities must be denominated in U.S. dollars and must be fixed rate, nonconvertible, and taxable. The CPI +100 Basis Points benchmark is created by adding 1% to the annual percentage change in the Consumer Price Index (“CPI”).  This index reflects non seasonably adjusted returns. The Consumer Price Index is an unmanaged index representing the rate of the inflation of the U.S. consumer prices as determined by the U.S. Department of Labor Statistics. There can be no guarantee that the CPI of other indexes will reflect the exact level of inflation at any given time.  These indices do not reflect any commissions or fees which would be incurred by an investor purchasing the stocks they represent.  The performance of the Fund and of the Indices are computed on a total return basis which includes reinvestment of all distributions.  It is not possible to invest in an index.

The Barclays Capital Family of Indices ratings rules use the median if more than two ratings are available. Lower of the two is used if only two ratings are available.

For definitions of ratings please see http://www.standardandpoors.com/ratings/definitions-and-faqs/en/us. The lowest credit quality rating available from the three major rating agencies is used when calculating the weighted-average credit quality of the portfolio.  Other sources may report different average credit quality information because they may not necessarily use the lowest quality rating for a given security and they may use a different formula to calculate the average rating.  For example, Morningstar's Fixed-Income Survey Guidelines use the Barclays Capital Global Family of Indices ratings rules.  These rules use the lowest rating for bonds with only two ratings and the middle rating is used for bonds with more than two ratings. In addition, the calculation of the average for the portfolio may place different weightings on securities rated differently.

As of June 30, 2012
(NAV) 1 Year 5 Years 10 Years
Before Tax 1.69% 3.50% 3.55%
After Tax on Distribution* 1.00% 2.22% 2.10%
After Tax on Distribution and Sale of Fund Shares* 1.32% 2.29% 2.19%
(With Load) 1 Year 5 Years 10 Years
Before Tax -1.87% 2.76% 3.18%
After Tax on Distribution* -3.16% 1.36% 1.67%
After Tax on Distribution and Sale of Fund Shares* -2.33% 1.54% 1.81%

*After -tax returns are calculated using the historical highest individual federal marginal income tax rates and do not reflect the impact of state and local taxes.  Actual after-tax returns depend upon an investor's tax situation and may differ from those shown.  After-tax returns presented here are not relevant to investors who hold their Fund shares through tax-deferred arrangements, such as 401(k) plans or IRAs.

Performance has been calculated on a total return basis, which combines principal and dividend income changes for the periods shown. Principal changes are based on the difference between the beginning and closing net asset values for the period and assume reinvestment of all dividends and distributions paid. The maximum sales charge of 3.50% and all applicable expenses such as advisory fees have been included in calculating the after tax (with load) performance. Total return calculations are based on a $10,000 investment. This data represents past performance and investors should understand that investment returns and principal values fluctuate, so that when you redeem your investment it may be worth more or less than its original cost. The Prospectus details the Fund"s objective and policies, sales charges, and other matters of interest to the prospective investor. Please read this Prospectus carefully before investing.