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California Tax Free Fund

Summary

Summary

What is the California Tax Free Fund?

The Fund seeks to deliver a high level of income exempt from federal and state taxation by investing primarily in California municipal bonds.

Yield

Dividend Yield 1 as of 09/23/2016  

  Subsidized3 Un-Subsidized4
w/o sales charge - 3.00%
w/ sales charge - 2.93%

30-Day Standardized Yield 2 as of 08/31/2016  

2.94%

Fund Basicsas of 08/31/2016

Total Net Assets
$337.67 M
Inception Date
09/03/1985
Dividend Frequency
Monthly
Fund Gross Expense Ratio
0.82%
Fund Net Expense Ratio
0.81%
Number of Holdings
246
CUSIP
543902852
Minimum Initial Investment
$1,000+

Fund Expense Ratio :

Gross 0.82%

Net 0.81%

YTD 1-YR 3-YR 5-YR 10-YR Since Inception 09/03/1985
w/o sales charge 6.00% 9.10% 8.65% 6.80% 4.66% 6.10%
Lipper Category Avg. California Municipal Debt Funds 5.19% 8.05% 7.92% 6.11% 4.59% -
Barclays Municipal Bond Index 4.54% 6.88% 6.47% 4.80% 4.87% -
w/ sales charge 3.64% 6.63% 7.81% 6.30% 4.43% 6.02%

Fund Expense Ratio :

Gross 0.82%

Net 0.81%

Fund Expense Ratio :

Gross 0.82%

Net 0.81%

YTD 1-YR 3-YR 5-YR 10-YR Since Inception 09/03/1985
w/o sales charge 5.65% 9.67% 7.25% 7.23% 4.88% 6.12%
Lipper Category Avg. California Municipal Debt Funds 5.07% 9.02% 6.72% 6.67% 4.86% -
Barclays Municipal Bond Index 4.33% 7.65% 5.58% 5.33% 5.13% -
w/ sales charge 3.30% 7.18% 6.42% 6.75% 4.64% 6.04%

Fund Expense Ratio :

Gross 0.82%

Net 0.81%

RELATED CONTENT

Principles of Portfolio Construction: Lord Abbett Municipal Bond Strategy
Principles of Portfolio Construction: Lord Abbett Municipal Bond Strategy
November 5, 2014

Daniel Solender, Lord Abbett Partner & Director of Municipal Bonds, discusses the philosophy and methodology that guides portfolio construction in the firm’s municipal bond strategy.

Sector Assets
Healthcare/Hospital
Transportation
Special Tax
IDR/PCR
Education
GO State
GO Local
Lease
Power
Pre-Refunded
Water & Sewer
Insured
Housing
Resource Recovery
Other
Maturity Assets
1-4.99 Years
5-9.99 Years
10-19.99 Years
20-29.99 Years
>30 Years

Credit Quality Distribution as of 08/31/2016

Rating Assets
AAA
AA
A
BBB
< BBB
Not Rated

Investment Team

Daniel S. Solender
Daniel S. Solender, CFA

Partner & Director

29 Years of Industry Experience

Supported By 12 Investment Professionals and 12 Years Avg. Industry Experience

Contact a Representative

To contact your representative, enter your zip code and select your channel below.

Performance

Performance

Dividend Yield 1 as of 09/23/2016  

  Subsidized3 Un-Subsidized4
w/o sales charge - 3.00%
w/ sales charge - 2.93%

30-Day Standardized Yield 2 as of 08/31/2016  

  Subsidized3 Un-Subsidized4
w/o sales charge 2.94% 2.94%

Fund Expense Ratio :

Gross 0.82%

Net 0.81%

YTD 1-YR 3-YR 5-YR 10-YR Since Inception 09/03/1985
w/o sales charge 6.00% 9.10% 8.65% 6.80% 4.66% 6.10%
Lipper Category Avg. California Municipal Debt Funds 5.19% 8.05% 7.92% 6.11% 4.59% -
Barclays Municipal Bond Index 4.54% 6.88% 6.47% 4.80% 4.87% -
w/ sales charge 3.64% 6.63% 7.81% 6.30% 4.43% 6.02%

Fund Expense Ratio :

Gross 0.82%

Net 0.81%

Fund Expense Ratio :

Gross 0.82%

Net 0.81%

YTD 1-YR 3-YR 5-YR 10-YR Since Inception 09/03/1985
w/o sales charge 5.65% 9.67% 7.25% 7.23% 4.88% 6.12%
Lipper Category Avg. California Municipal Debt Funds 5.07% 9.02% 6.72% 6.67% 4.86% -
Barclays Municipal Bond Index 4.33% 7.65% 5.58% 5.33% 5.13% -
w/ sales charge 3.30% 7.18% 6.42% 6.75% 4.64% 6.04%

Fund Expense Ratio :

Gross 0.82%

Net 0.81%

Best returns

Durations Fund Returns Blended Index
3-Mo 10.78 7.12
1-Yr 22.86 24.65

Worst returns

Durations Fund Returns Blended Index
3-Mo -11.88 -5.36
1-Yr -13.46 -2.47
Year Fund Returns Barclays Municipal Bond Index
2015 3.64% 3.30%
2014 13.20% 9.05%
2013 -3.92% -2.55%
2012 11.88% 6.78%
2011 11.18% 10.70%
2010 0.99% 2.38%
2009 20.07% 12.91%
2008 -13.46% -2.47%
2007 -0.56% 3.36%
2006 4.19% 4.84%
2005 3.95% -
2004 4.46% -
2003 3.68% -
2002 7.63% -
2001 4.40% -
2000 14.86% -
1999 -6.35% -
1998 6.11% -
1997 8.85% -
1996 3.43% -
Year Q1 Q2 Q3 Q4 Yearly Returns
2016 1.95% 3.63% - - 5.55%
2015 1.11% -1.26% 1.70% 2.07% 3.64%
2014 4.66% 3.61% 2.38% 1.97% 13.20%
2013 0.48% -3.91% -0.73% 0.25% -3.92%
2012 4.49% 1.78% 3.42% 1.72% 11.88%
2011 -0.74% 5.27% 3.63% 2.68% 11.18%
2010 1.59% 1.40% 4.53% -6.21% 0.99%
2009 6.14% 4.21% 10.78% -2.00% 20.07%
2008 -2.47% 1.36% -5.84% -7.03% -13.46%
2007 0.61% -0.94% 0.04% -0.26% -0.56%
2006 0.25% -0.24% 2.97% 1.17% 4.19%
2005 0.32% 3.10% -0.03% 0.53% 3.95%
2004 2.03% -2.95% 4.01% 1.43% 4.46%
2003 0.69% 2.98% -1.69% 1.70% 3.68%
2002 0.03% 3.01% 5.49% -0.99% 7.63%
2001 1.78% -0.68% 4.28% -0.97% 4.40%
2000 4.00% 1.41% 3.32% 5.39% 14.86%
1999 0.71% -2.95% -2.06% -2.14% -6.35%
1998 0.83% 1.57% 3.42% 0.19% 6.11%
1997 -0.81% 3.11% 3.53% 2.78% 8.85%
1996 -1.96% 0.57% 2.48% 2.36% 3.43%
1995 7.75% 2.21% 2.16% 4.36% 17.41%
1994 -7.30% -0.36% 0.35% -3.46% -10.50%
1993 5.07% 3.47% 3.93% 0.82% 13.87%
1992 0.17% 4.58% 2.03% 2.01% 9.01%
1991 1.91% 2.69% 4.31% 3.89% 13.41%
1990 0.47% 2.36% 0.01% 4.27% 7.23%
1989 0.64% 6.08% -0.13% 3.02% 9.85%
1988 2.92% 2.21% 2.97% 2.75% 11.27%
1987 2.88% -6.58% -4.12% 6.92% -1.45%
1986 8.50% -0.68% 5.52% 4.54% 18.87%
1985 - - - 8.05% 4.99%

Growth of $10,000 as of 08/31/2016

NAV Historical Prices

Date Net Asset Value

Portfolio

Portfolio

Sector Assets
Healthcare/Hospital
Transportation
Special Tax
IDR/PCR
Education
GO State
GO Local
Lease
Power
Pre-Refunded
Water & Sewer
Insured
Housing
Resource Recovery
Other
Maturity Assets
1-4.99 Years
5-9.99 Years
10-19.99 Years
20-29.99 Years
>30 Years
By State Assets
CA
Puerto Rico
Other U.S. Territories

CREDIT QUALITY DISTRIBUTION as of 08/31/2016

Rating Assets
AAA
AA
A
BBB
< BBB
Not Rated

Portfolio Positioning as of 06/30/2016

  • Relative to its benchmark, the Barclays Municipal Bond Index, the portfolio is underweight the 1-10 year maturity range and overweight bonds with maturities greater than 12 years, as longer bonds exhibit relative value given the composition of new issue supply.
  • The portfolio is overweight ‘A’ rated bonds due to attractive spreads and solid credit fundamentals.
  • The portfolio continues to overweight revenue bonds, including special tax-backed and health care, given their dedicated income stream and favorable return prospects. 

Portfolio Details as of 08/31/2016

Total Net Assets
$337.67 M
Number of Issues
246
Average Coupon
5.10%
Average Effective Maturity
18.9 Years
Average Effective Duration
6.36 Years

Dividends & Cap Gains

Dividends & Cap Gains

Dividend Payments

For
YTD Dividends Paidas of 09/23/2016
$0.243
Dividend Frequency
Monthly (Daily Accrual)
Record Date Ex-Dividend Date Reinvest & Payable Date Dividend Reinvest Price
Daily Daily 08/31/2016 $0.02830 $11.39
Daily Daily 07/31/2016 $0.02967 $11.39
Daily Daily 06/30/2016 $0.03041 $11.41
Daily Daily 05/31/2016 $0.03009 $11.21
Daily Daily 04/30/2016 $0.03070 $11.17
Daily Daily 03/31/2016 $0.03063 $11.10
Daily Daily 02/29/2016 $0.03160 $11.08
Daily Daily 01/31/2016 $0.03172 $11.09

Upcoming Dividend Payment Dates

This section lists all anticipated income and Capital Gain distribution dates and any actual distributions are subject to adequacy of earnings and must be approved by the Board of Directors/Trustees. Please note that dates are subject to change.

Record Date Ex-Dividend Date Reinvest & Payable Date
Daily Daily 09/30/2016
Daily Daily 10/31/2016
Daily Daily 11/30/2016
Daily Daily 12/31/2016

Capital Gains Distributions

For
Record Date Reinvest & Payable Date Long-term Short-term * Total Reinvest Price
09/08/1993 09/15/1993 - - $0.3500 $11.60

Upcoming Capital Gain Distribution

This section lists all anticipated income and Capital Gain distribution dates and any actual distributions are subject to adequacy of earnings and must be approved by the Board of Directors/Trustees. Please note that dates are subject to change.

Record Date Ex-Dividend Date
12/20/2016 12/21/2016

Fees & Expenses

Fees & Expenses

Sales Charge Schedule as of 09/23/2016

  Sales Charge Dealer's Concession Prices at Breakpoint
Less than $100,000 2.25% 2.00% $11.58
$100,000 to $249,999 1.75% 1.50% $11.52
$250,000 to $499,999 1.25% 1.00% $11.46
$500,000 to $999,999 0.00% 1.00% $11.32
$1,000,000 to $5,000,000 0.00% 1.00% $11.32

Expense Ratioas of 08/31/2016

Fund Gross Expense Ratio Fund Net Expense Ratio
0.82% 0.81%

Fund Review

Fund Review

Market Review as of 06/30/2016

The U.S. municipal bond market (as represented by the Barclays Municipal Bond Index[1]) continued to advance in the second quarter, surpassing the returns of other notable asset classes during the period, including large-cap equities (as represented by the S&P 500 Index[2]), international equities (as represented by the MSCI EAFE Index[3]), and taxable investment-grade bonds (as represented by the Barclays U.S. Aggregate Bond Index[4]).

Total issuance was slightly ahead of the second quarter of the prior year, with refunding issues exceeding new capital issuance during the period, as issuers continue to take advantage of low market rates.  Investor demand for municipal bonds remained strong, as investors sought income in a low-yield environment as well as greater insulation from global factors that have introduced volatility to other parts of the market.  Consequently, year-to-date municipal fund flows, based on information from Lipper U.S. fund flows, exceeded $33 billion at the end of the quarter. In terms of maturity and quality, the demand for incremental yield has resulted in longer-maturity municipal bonds outperforming shorter-maturity municipal bonds and lower-quality bonds generally outperforming higher-quality bonds during the second quarter. 

High-profile issuers, such as Illinois and New Jersey, remained in the spotlight during the past quarter, as these issuers continue to struggle with pension and budget issues.  In the case of Puerto Rico, the commonwealth has marked the headlines with defaults, the most recent of which was on general obligation debt, a type of debt that has not experienced a default in decades. In order to help manage the situation in Puerto Rico and address its debt crisis, Congress approved a financial rescue bill on June 30, which will place the island’s finances under the control of a federally appointed oversight board. Despite the aforementioned defaults, Puerto Rico bonds, in general, have outperformed the broad municipal bond market (as represented by the Barclays Municipal Bond Index) as well as the Barclays High Yield Municipal Bond Index[5] during the second quarter and YTD period. Isolated pockets of distress aside, overall creditworthiness continues to improve, as many states’ finances experienced rising revenues, while maintaining balanced budgets.

Outlook

Demand for municipal bonds showed no sign of diminishing as the second quarter came to a close. Investors were drawn to the relative stability of the municipal market and the relatively attractive yields offered in this low-rate environment. Therefore, we believe that healthy demand likely will persist, given that municipal yields continue to provide investors with compelling taxable-equivalent income, default rates that remain low, and overall creditworthiness that continues to improve. New-issue supply is expected to remain relatively strong going forward, as new-money issuance for new projects remains stable and the refunding of outstanding bonds will likely increase by reason of a flatter yield curve and persistently low interest rates.

Ratios of municipal bond yields to Treasuries have decreased substantially this year, and are likely to remain stable at these levels due to the strong demand for municipals aiding market performance. Lower-rated municipal bond spreads may remain somewhat stable or slightly tighten as desire for incremental

yield remains strong. Although the low yields offered at the short end of the yield curve make a rally in shorter-term bonds less probable, investor uncertainty regarding the state of the global economy could prolong the rally in longer-term tax-free bonds, as fears of inflation or a Federal Reserve rate hike remain subdued. 

Although a few high-profile issuers, such as New Jersey and Illinois, are hampered by challenges, and likely will continue to remain under pressure (as a result of pension reform and funding of pension liabilities), it is important to focus on overall state health and creditworthiness, which are expected to remain stable. In general, the pace of revenue growth has slowed, compared with recent years; however, budgets are being successfully balanced across most states, and tax revenues remain strong as employment continues to improve nationally and the economy continues to slowly grow. Since it is an election year, it is unlikely that Washington will introduce any legislation that would affect the overall municipal bond market.  However, Puerto Rico bonds could be affected by the actions of the federally-appointed financial control board created by the recent legislation, which aims to give the island an avenue to restructure its $72 billion of debt. Municipal bonds continue to offer the combination of a high credit-quality profile and relatively attractive, taxable-equivalent returns to investors. 

Fund Documents

Fund Documents

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Summary Prospectus
Publish Date:11/03/2015
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Statutory Prospectus
Publish Date:11/03/2015
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Prospectus (XBRL)
Publish Date:11/03/2015
SAI
Publish Date:11/03/2015
Annual Report
Publish Date:11/03/2015
Semi-Annual Report
Publish Date:11/03/2015
Fact Sheet
Publish Date:11/03/2015

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Class A  Except as noted below, returns with sales charges reflect a maximum sales charge of 5.75% for equity funds, 2.25% for all tax-free income funds, fixed income funds and multi-asset class funds. There are also ongoing 12b-1 service fees (and, in certain cases, distribution fees).

Class A Shares purchased subject to a front-end sales charge have no contingent deferred sales charge (CDSC). However, certain purchases of Class A shares made without a front-end sales charge may be subject to a CDSC of 1% if the shares are redeemed before the first day of the month in which the one year anniversary of the purchase falls. The CDSC is not reflected in the performance with maximum sales charge.

The Barclays Municipal Bond Index is a rules-based, market-value-weighted index engineered for the long-term tax-exempt bond market. The index is a broad measure of the municipal bond market with maturities of at least one year. To be included in this index, bonds must have a minimum credit rating of at least Baa, an outstanding par value of at least $7 million and be issued as part of a transaction of at least $75 million. The bonds must be fixed rate, have a dated-date after December 31, 1990, and must be at least one year from their maturity date. Remarketed issues, taxable municipal bonds, bonds with floating rates, and derivatives, are excluded from the index.

Select funds to run a Morningstar Hypothetical Report.

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