Performance data quoted reflect past performance and are no guarantee of future results. Current performance may be higher or lower than the performance quoted. The investment return and principal value of an investment in the Fund will fluctuate so that shares, on any given day or when redeemed, may be worth more or less than their original cost. You can obtain performance data current to the most recent month-end by calling Lord Abbett at 888-522-2388 or referring to lordabbett.com.
The performance information shown is based on total return at net asset value, including the reinvestment of dividends and capital gains, if any, but excludes sales charges which are not applicable to Class F Shares.
The Bond Debenture Class F share rankings within the Morningstar Multisector Bond Category as of 12/31/21 for the one-year time period was 26% (65/339); three-year, 9% (20/273); five-year, 10% (21/234); and 10-year, 2% (5/131).
6 Reasons to Consider Bond Debenture Fund
1. Decades of Outperformance vs. Multisector, High Yield, and Core-Plus Category Averages
Bond Debenture F-share Data as of 12/31/21.The performance quotations for Class F share before 09/28/2007 are based on the historical performance of the Funds Class A Share restated to reflect all charges and fees applicable to Class F Share.
Source: Morningstar. Past performance is no guarantee of future results. The performance information shown is based on total return at net asset value, including the reinvestment of dividends and capital gains, if any, but excludes sales charges which are not applicable to Class F Shares. Morningstar category averages are based on all share classes of each fund within the category. The performance of the Bond Debenture Fund vs. the Morningstar categories may have been different during other time periods.
2. Yields Have Fallen Over the Past 4 Decades
Market Yield on U.S. Treasury Securities
Data as of 12/31/2021. Source: FRED. For illustrative purposes only and does not represent any specific portfolio managed by Lord Abbett or any particular investment.
With U.S. Treasury yields remaining near multi-year lows, income investors may wish to consider a multi-sector bond strategy. Here’s why.
3. Core Bonds: Duration Has Extended as Yields Have Declined
Bloomberg Barclays U.S. Aggregate Index: Duration and Yield (As of 12/31/2021)
Source: Bloomberg Index Services Limited. The historical data are for illustrative purposes only and does not represent any specific portfolio managed by Lord Abbett or any particular investment, and are not intended to predict or depict future results. Indexes are unmanaged, do not reflect the deduction of fees or expenses, and are not available for direct investnment.
4. Historically Strong Performance During Rising Rates
Returns when the 10-year Treasury yield rose more than 100 basis points (month-end annualized returns)
Index Data Sources: FTSE Russell and Bloomberg Index Services Limited. Past performance is no guarantee of future results. Indexes are unmanaged, do not reflect the deduction of fees and expenses, and are not available for direct investment.
Lord Abbett Portfolio Manager Leah Traub looks at the factors driving recent movements in interest rates.
5. Credit Sectors Diversify Core Bond Allocations
Correlation with Bloomberg U.S. Government Index (10/01/2011 - 12/31/2021)
1Bloomberg U.S. Aggregate Bond Index. 2Bloomberg U.S. Treasury U.S. TIPS Index. 3Bloomberg U.S. Corporate Baa-Rated Index. 4ICE BofA Corporate BBB 1-3 year index. 5Bloomberg U.S. Corporate High Yield Index. 6S&P 500 Index. 7ICE BofA All Convertibles All Qualities Index. 8Credit Suisse Leveraged Loan Index. Source: Morningstar. Past performance is not a reliable indicator or guarantee of future results. Correlation is a statistic that measures the degree of association between two variables. For illustrative purposes only and does not represent any specific portfolio managed by Lord Abbett or any particular investment. Indexes are unmanaged, do not reflect the deduction of fees or expenses, and are not available for direct investment.
6. True Market Participation with Less Risk
(01/01/2001 - 12/31/2021)
Index Data Source: Standard & Poor's. Past performance is no guarantee of future results. The fund performance information shown is based on total return at net asset value, including the reinvestment of dividends and capital gains, if any, but excludes sales charges which are not applicable to Class F Shares. Indexes are unmanaged, do not reflect the deduction of fees and expenses, and are not available for direct investment.
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F-Share Data as of 12/31/2021.
1Morningstar rated the Lord Abbett Bond-Debenture class F share 4, 4 and 5 stars among 275, 237 and 135 Multisector Bond Funds for the overall rating and the 3, 5 and 10 year periods ended 1/31/2022, respectively. The Morningstar Rating™ for funds, or "star rating", is calculated for managed products (including mutual funds, variable annuity and variable life sub-accounts, exchange-traded funds, closed-end funds, and separate accounts) with at least a three-year history. Exchange-traded funds and open-ended mutual funds are considered a single population for comparative purposes. It is calculated based on a Morningstar Risk-Adjusted Return measure that accounts for variation in a managed product's monthly excess performance, placing more emphasis on downward variations and rewarding consistent performance. The top 10% of products in each product category receive 5 stars, the next 22.5% receive 4 stars, the next 35% receive 3 stars, the next 22.5% receive 2 stars, and the bottom 10% receive 1 star. The Overall Morningstar Rating for a managed product is derived from a weighted average of the performance figures associated with its three-, five-, and 10-year (if applicable) Morningstar Rating metrics. The weights are: 100% three-year rating for 36-59 months of total returns, 60% five-year rating/40% three-year rating for 60-119 months of total returns, and 50% 10-year rating/30% five-year rating/20% three-year rating for 120 or more months of total returns. While the 10-year overall star rating formula seems to give the most weight to the 10-year period, the most recent three-year period actually has the greatest impact because it is included in all three rating periods. Ratings do not take into account the effects of sales charges and loads.
2Category: Morningstar Multisector Bond Funds Average: Multisector bond portfolios seek income by diversifying their assets among several fixed-income sectors, usually U.S. government obligations, U.S. corporate bonds, foreign bonds, and high-yield U.S. debt securities. These portfolios typically hold 35% to 65% of bond assets in securities that are not rated or are rated by a major agency such as Standard & Poor's or Moody's at the level of BB (considered speculative for taxable bonds) and below.
3Bond Debenture F-Share inception date is April 2007.
A Note about Risk: The Fund is subject to the general risks associated with investing in debt securities, including market, credit, liquidity, and interest rate risk. The value of your investment will change as interest rates fluctuate and in response to market movements. When interest rates fall, the prices of debt securities tend to rise, and when interest rates rise, the prices of debt securities are likely to decline. Longer-term debt securities are usually more sensitive to interest-rate changes; the longer the maturity of a security, the greater the effect a change in interest rates is likely to have on its price. The Fund may make substantial investments in high-yield debt securities and may invest in senior loans which may be primarily below-investment grade. High-yield securities, sometimes called junk bonds, carry increased risks of price volatility, illiquidity, and the possibility of default in timely payment of interest and expenses. The value of investments in equity securities will fluctuate in response to general economic conditions and to changes in the prospects of particular companies and/or sectors in the economy. Convertible securities are subject to the risks affecting both equity and fixed income securities, including market, credit, liquidity, and interest rate risk. These factors can affect Fund performance.
Diversification does not protect against losses in a declining market.
Dividend Yield is a financial ratio that shows how much a mutual fund pays out in dividends each year relative to value with maximum sales charges and without sales charges. The dividend yield is calculated by annualizing the last dividend and dividing it by the fund’s net asset value with maximum sales charges and without sales charges.
The 30-Day SEC Yield represents net investment income earned by a fund over a 30-day period. It is expressed as an annual percentage rate using a method of calculation adopted by the Securities and Exchange Commission (SEC). Yields for other share classes will vary.
The S&P 500 Index is a stock market index that measures the stock performance of 500 large companies listed on stock exchanges in the United States. It is one of the most commonly followed equity indices
The Bloomberg U.S. Aggregate Bond Index represents securities that are SEC-registered, taxable, and dollar denominated. The index covers the U.S. investment grade fixed rate bond market, with index components for government and corporate securities, mortgage pass-through securities, and asset-backed securities. Total return comprises price appreciation/depreciation and income as a percentage of the original investment.
Bloomberg Index Information:
Source: Bloomberg Index Services Limited. BLOOMBERG® is a trademark and service mark of Bloomberg Finance L.P. and its affiliates (collectively “Bloomberg”). Bloomberg owns all proprietary rights in the Bloomberg Indices. Bloomberg does not approve or endorse this material, or guarantee the accuracy or completeness of any information herein, or make any warranty, express or implied, as to the results to be obtained therefrom and, to the maximum extent allowed by law, shall not have any liability or responsibility for injury or damages arising in connection therewith.