Virtus Global Multi-Sector Income Fund

The fund is sub-advised by Newfleet Asset Management, the multi-sector fixed-income affiliate of Virtus Investment Partners. Newfleet's team manages the day-to-day security selection and sector allocation across high-yield, bank loans, and emerging-market debt. The firm has historically operated with a credit-research-heavy, bottom-up approach led by a senior portfolio management group (per the firm's regulatory filings).

The fund targets a managed distribution rate, which has historically approximated 8% of net asset value on an annualized basis, paid monthly. Distributions are funded from net investment income, realized capital gains, and — when income and gains fall short — a return of capital. The precise mix is reported in a 19(a) notice to shareholders each month.

The closed-end structure provides a fixed capital base that allows the sub-adviser to invest in less-liquid asset classes, such as leveraged bank loans and emerging-market corporate bonds, without worrying about daily shareholder redemptions. This structural match between fund liquidity and underlying asset liquidity is the primary rationale. The trade-off is that investors transact at the market price, which can reflect a discount or premium to the fund's NAV.

The fund typically operates with leverage in the range of 25–30% of total managed assets, using a combination of a committed credit facility and reverse repurchase agreements. The leverage is used to amplify current income, but it also increases the sensitivity of the NAV and distribution coverage to changes in short-term interest rates and credit spreads (per the fund's annual reports).

Yes. The board has renewed a conditional share repurchase program that allows the fund to buy back up to 5% of its outstanding common shares in a rolling 12-month period. The program is designed to be activated when shares trade at a discount to NAV that exceeds 10%, measured by the average of the closing prices over the prior five business days (per the firm, February 2023).

The mandate skews heavily toward below-investment-grade credits. The high-yield corporate bond and bank loan allocations are predominantly B and BB rated, while the emerging-market positions mix sovereign and corporate issuers ranging from BB to CCC. The fund will also hold small allocations to investment-grade corporate bonds and securitized credit for diversification and liquidity management.

Virtus Investment Partners is the parent company and investment adviser to the fund, operating a multi-boutique model. Newfleet Asset Management is a wholly owned, specialized fixed-income affiliate that serves as sub-adviser. Newfleet was acquired by Virtus in 2011 and provides the sector teams that run the day-to-day credit selection for VGI and several other Virtus fixed-income funds.