Madison Moderate Allocation Fund: Q3 2025 Strategy and Outlook

The Madison Moderate Allocation Fund enters Q3 2025 with a disciplined, diversified stance aimed at balancing growth potential and downside protection. With the macro backdrop characterized by persistent interest-rate volatility, uneven global growth and selective opportunity in equity markets, the fund maintains a core balanced posture—blending equities, high-quality fixed income, and opportunistic cash positions.

Equity exposure is positioned to capture cyclical and secular themes while emphasizing company-level resilience. Portfolio managers favor sectors with durable earnings and cash flow profiles, including selective technology, healthcare and industrial names, while rotating away from highly leveraged or momentum-driven segments. Security selection remains active: the team seeks attractively valued equities with strong balance sheets and sustainable competitive advantages.

On the fixed-income side, the fund emphasizes intermediate-duration investment-grade bonds and a measured allocation to inflation-linked securities to guard against real-rate risks. Credit exposure is selective, prioritizing high-quality corporate issuers and diversified municipal holdings where yield and credit fundamentals justify exposure. Liquidity is preserved through short-duration instruments and a modest cash buffer to enable tactical rebalancing or opportunistic purchases amid market dislocations.

Risk management is central to the strategy. Managers use duration controls, sector tilts and position sizing to reduce sensitivity to interest-rate swings and market volatility. Rebalancing discipline helps lock in gains and refresh allocations when valuation or macro signals change. The team also monitors geo‑political and policy developments that could trigger sudden shifts in risk sentiment.

Looking ahead, the fund remains pragmatic: preparing for a range of outcomes while leaning toward a diversified, active allocation that can adapt as conditions evolve. The approach aims to deliver consistent, moderate returns over a full market cycle by combining selective growth exposure with defensive fixed-income holdings and adaptive risk controls. Investors should view the positioning as balanced and actively managed, designed to preserve capital in adverse environments while participating in upside when market conditions improve.