LFRAX | Floating Rate Fund Class A | Lord Abbett
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Floating Rate Fund

Summary

Summary

What is the Floating Rate Fund?

The Fund seeks to deliver a high level of current income by investing primarily in a variety of below investment grade loans.

 

HISTORY OF CREDIT RESEARCH

Brings a 45-year heritage of high-yield credit investing, based on rigorous, fundamental credit research.

ATTRACTIVE INCOME & LOW EXPENSES

Has provided attractive income and lower expenses relative to its Morningstar peer group category average.

ATTRACTIVE RETURN FOR RISK

Has offered a track record of strong performance versus peers in up and down markets, demonstrating the strength of this active approach as a core bank loan holding over a full market cycle.

 

Yield

Dividend Yield 1 as of 09/17/2021  

w/o sales charge 3.92%
w/ sales charge 3.84%

30-Day Standardized Yield 2 as of 08/31/2021  

3.60%

Expense Ratioas of 08/31/2021

Fund Basicsas of 08/31/2021

Total Net Assets
$6.44 B
Inception Date
12/31/2007
Dividend Frequency
Monthly (Daily Accrual)
Number of Holdings
640
Minimum Initial Investment
$1,500+

Fund Expense Ratio :

0.80%

YTD 1-YR 3-YR 5-YR 10-YR Since Inception 12/31/2007
w/o sales charge 3.97% 9.04% 2.04% 3.17% 4.34% 3.89%
Lipper Category Avg. Loan Participation Funds 3.41% 7.57% 2.94% 3.57% 3.95% -
CS Leveraged Loan Index 3.98% 8.50% 4.10% 4.69% 5.00% 4.51%
w/ sales charge 1.64% 6.65% 1.27% 2.70% 4.11% 3.72%

Fund Expense Ratio :

0.80%

Fund Expense Ratio :

0.80%

YTD 1-YR 3-YR 5-YR 10-YR Since Inception 12/31/2007
w/o sales charge 3.65% 12.47% 2.31% 3.57% 3.86% 3.92%
Lipper Category Avg. Loan Participation Funds 2.99% 10.52% 3.17% 3.92% 3.48% -
CS Leveraged Loan Index 3.48% 11.67% 4.36% 5.04% 4.52% 4.53%
w/ sales charge 1.33% 9.93% 1.54% 3.09% 3.63% 3.74%

Fund Expense Ratio :

0.80%

RELATED CONTENT

An Update on Floating Rate Bank Loans Amid Recent Market Volatility
April 17, 2020

Our expert assesses current market conditions—and the historical resilience of floating rate bank loans after periods of elevated volatility.

Leveraged Credit: Asymmetric Risks in ‘BB’-Rated Debt
January 13, 2020

Elevated prices for ‘BB’-rated securities in both the high yield bond and leveraged loan markets suggest better value and upside in certain lower-rated credit.

Type Assets
Bank Loans
High Yield Bonds
Equity
ABS
Other
Cash
Maturity Assets
Less than 1 year
1-3 years
3-5 years
5-7 years
7-10 years
Greater than 10 years

Credit Quality Distribution as of 08/31/2021 View Portfolio

Rating Assets
BBB
BB
B
<B
Not Rated

INVESTMENT TEAM

Jeffrey D. Lapin
Jeffrey D. Lapin, J.D.

Partner & Portfolio Manager

23 Years of Industry Experience

Steven F. Rocco
Steven F. Rocco, CFA

Partner & Co-Head of Taxable Fixed Income

19 Years of Industry Experience

Kearney M. Posner
Kearney M. Posner, CFA

Managing Director, Portfolio Manager

21 Years of Industry Experience

Robert A. Lee
Robert A. Lee

Partner & Co-Head of Taxable Fixed Income

29 Years of Industry Experience

Supported By 63 Investment Professionals with 16 Years Avg. Industry Experience

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Performance

Performance

Dividend Yield 1 as of 09/17/2021  

w/o sales charge 3.92%
w/ sales charge 3.84%

30-Day Standardized Yield 2 as of 08/31/2021  

  Subsidized3 Un-Subsidized4
w/o sales charge 3.60% 3.60%

Fund Expense Ratio :

0.80%

YTD 1-YR 3-YR 5-YR 10-YR Since Inception 12/31/2007
w/o sales charge 3.97% 9.04% 2.04% 3.17% 4.34% 3.89%
Lipper Category Avg. Loan Participation Funds 3.41% 7.57% 2.94% 3.57% 3.95% -
CS Leveraged Loan Index 3.98% 8.50% 4.10% 4.69% 5.00% 4.51%
w/ sales charge 1.64% 6.65% 1.27% 2.70% 4.11% 3.72%

Fund Expense Ratio :

0.80%

Fund Expense Ratio :

0.80%

YTD 1-YR 3-YR 5-YR 10-YR Since Inception 12/31/2007
w/o sales charge 3.65% 12.47% 2.31% 3.57% 3.86% 3.92%
Lipper Category Avg. Loan Participation Funds 2.99% 10.52% 3.17% 3.92% 3.48% -
CS Leveraged Loan Index 3.48% 11.67% 4.36% 5.04% 4.52% 4.53%
w/ sales charge 1.33% 9.93% 1.54% 3.09% 3.63% 3.74%

Fund Expense Ratio :

0.80%

Year Fund Returns CS Leveraged Loan Index
2020 -1.70% 2.78%
2019 7.34% 8.17%
2018 -0.23% 1.14%
2017 3.86% 4.25%
2016 9.89% 9.88%
2015 0.35% -0.38%
2014 0.93% 2.06%
2013 5.89% 6.15%
2012 10.12% 9.43%
2011 1.44% 1.82%
2010 8.18% -
2009 32.26% -
2008 -21.31% -
2007 0.01% -
Year Q1 Q2 Q3 Q4 Yearly Returns
2021 1.82% 1.80% - - -
2020 -15.76% 7.54% 3.79% 4.54% -1.70%
2019 3.41% 1.64% 0.61% 1.51% 7.34%
2018 1.17% 0.72% 1.76% -3.78% -0.23%
2017 0.92% 0.44% 1.12% 1.33% 3.86%
2016 1.72% 2.77% 2.98% 2.09% 9.89%
2015 2.05% 0.66% -1.09% -1.24% 0.35%
2014 1.05% 1.08% -0.58% -0.61% 0.93%
2013 2.52% 0.35% 1.21% 1.69% 5.89%
2012 4.06% 0.57% 3.39% 1.78% 10.12%
2011 1.85% 0.34% -3.95% 3.35% 1.44%
2010 3.07% -0.89% 3.23% 2.59% 8.18%
2009 8.97% 11.57% 6.33% 2.31% 32.26%
2008 -3.34% 4.10% -5.05% -17.64% -21.31%
2007 - - - - 0.01%

Growth of $10,000 as of 07/31/2021

NAV Historical Prices

Date Net Asset Value

Portfolio

Portfolio

Rating Assets
Bank Loans
High Yield Bonds
Equity
ABS
Other
Cash
Rating Assets
Less than 1 year
1-3 years
3-5 years
5-7 years
7-10 years
Greater than 10 years

Credit Quality Distribution as of 08/31/2021

Rating Assets
BBB
BB
B
<B
Not Rated

Portfolio Positioning as of 06/30/2021

  •  We continue to have a broadly constructive view on loans despite their underperformance relative to fixed rate securities as U.S. Treasury yields declined towards the end of the second quarter. The broader credit environment remains supportive for leveraged loan issuers and demand for the product has been persistent throughout the first half of 2021. Within the loan space, we maintained our focus on companies in industries that we believe are better positioned to adapt to and benefit from fundamental structural changes that were accelerated by the COVID-19 pandemic. The Fund reflects this thesis with positions in the healthcare and information technology sectors, the two largest allocations in the Fund, as we believe these areas are long-term beneficiaries from opportunities created by these structural changes.
  • We continue to find attractive opportunities in the reopening theme which has performed well over the last twelve months. We remain constructive in leisure, specifically gaming, which has now expanded from regional gaming investments to a more national theme as areas like Las Vegas return to pre-pandemic activity. Outside of gaming, we also see value in the entertainment subsector, targeting issues in resorts and amusement parks, as well as live events that should benefit from increased consumer demand. However, we have been selective in adding issues tied to reopening as many of these investments do not offer the same outsized returns as in previous quarters. The Fund had monetized multiple reopening investments that were call constrained with minimal price upside. This was significant in the aerospace sector where valuations had climbed to a level with limited potential for above-average returns. Given these heightened valuations, we see a return profile primarily driven by enhanced carry in 2H21 rather than catalyst-driven capital raising issues that were significant return sources over the last twelve months.
  • We believe the current economic landscape is favorable for bank loan issuers supported by solid economic growth (albeit likely to peak on a y/y basis in Q2) and a positive earnings outlook with low projected default rates. Using the approach of looking to the distress ratio as a guide, we estimate default loss over the coming 12 months of approximately 1% or less, falling from a peak of over 6% in late 2020. We believe the declining intensity in the default cycle over time along with the uplift in credit quality are key ingredients that further support our continued positive outlook on the U.S. leveraged loan sector broadly. Specifically, we believe there continues to be opportunity in lower rated tiers of the credit market where valuations have generally lagged higher rated securities. We view the most attractive opportunities to be in CCC rated credit, which we believe has the highest upside given historically tight B spread levels and the recent pace of upgrades which has been meaningfully larger than the pace of downgrades.

Portfolio Details as of 08/31/2021

Total Net Assets
$6.44 B
Number of Issues
640

Dividends & Cap Gains

Dividends & Cap Gains

Dividend Payments

For
YTD Dividends Paidas of 09/17/2021
$0.216
Dividend Frequency
Monthly (Daily Accrual)
Record Date Ex-Dividend Date Reinvest & Payable Date Dividend Reinvest Price
Daily Daily 08/31/2021 $0.02759 $8.41
Daily Daily 07/31/2021 $0.02771 $8.39
Daily Daily 06/30/2021 $0.02722 $8.44
Daily Daily 05/31/2021 $0.02839 $8.41
Daily Daily 04/30/2021 $0.02473 $8.38
Daily Daily 03/31/2021 $0.02610 $8.37
Daily Daily 02/28/2021 $0.02685 $8.39
Daily Daily 01/31/2021 $0.02780 $8.36

Upcoming Dividend Payment Dates

Record Date Ex-Dividend Date Reinvest & Payable Date
Daily Daily 09/30/2021
Daily Daily 10/31/2021
Daily Daily 11/30/2021
Daily Daily 12/31/2021

Capital Gains Distributions

For
Record Date Reinvest & Payable Date Long-term Short-term * Total Reinvest Price
12/17/2013 12/18/2013 - $0.0160 $0.0160 $9.50

Upcoming Capital Gain Distribution

Record Date Ex-Dividend Date
12/16/2021 12/17/2021

Fees & Expenses

Fees & Expenses

Sales Charge Schedule as of 09/17/2021

  Sales Charge Dealer's Concession Prices at Breakpoint
Less than $100,000 2.25% 2.00% $8.63
$100,000 to $249,999 1.75% 1.50% $8.59
$250,000 to $499,999 1.25% 1.00% $8.55
$500,000 to $999,999 0.00% 1.00% $8.44
$1,000,000 to $5,000,000 0.00% 1.00% $8.44

Expense Ratioas of 08/31/2021

Fund Documents

Fund Documents

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Portfolio Holdings 1Q
Publish Date:11/03/2015
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Prospectus (XBRL)
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Publish Date:11/03/2015
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Publish Date:11/03/2015
Fact Sheet
Publish Date:11/03/2015
Commentary
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Fund Story
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The Credit Suisse Leveraged Loan Index is designed to mirror the investable universe of the U.S. dollar-denominated leveraged loan market. The CS Leveraged Loan Index is an unmanaged, trader-priced index that tracks leveraged loans. The CS Leveraged Loan Index, which includes reinvested dividends, has been taken from published sources.

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