LIFQX | Inflation Focused Fund Class R2 | Lord Abbett

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Inflation Focused Fund

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Summary

Summary

What is the Inflation Focused Fund?

The Fund seeks to deliver total returns that exceed the rate of inflation in the U.S. over a full inflation cycle and current income by combining investments in inflation swaps with a portfolio of short duration credit. 
 

EXPERIENCED INVESTMENT TEAM

The strategy is managed through a collaboration among 40+ investment professionals in portfolio management, credit research, and trading.

HIGHER INCOME POTENTIAL WITH LOWER DURATION

By utilizing short duration credit, the strategy generates the highest income stream in the Morningstar category with one-third the duration of the average TIPS-based portfolio.

TRUE INFLATION PROTECTION

By using inflation swaps to hedge exposure to investor expectations of future inflation, the strategy isolates inflation risk with much less nominal interest rate exposure than the Morningstar category.  As such, the strategy is designed to do well when inflation expectation increase.

Yield

Average Yield to Maturity as of 10/31/2023

7.00%

30-Day Standardized Yield 1 as of 10/31/2023  

  Subsidized2 Un-Subsidized3
w/o sales charge 4.75% 4.74%

Fund Basicsas of 10/31/2023

Total Net Assets
$1.25 B
Inception Date
04/29/2011
Dividend Frequency
Monthly
Fund Gross Expense Ratio
1.07%
Fund Net Expense Ratio
1.07%
Number of Holdings
596

Fund Expense Ratio :

Gross 1.07%

Net 1.07%

YTD 1-YR 3-YR 5-YR 10-YR Since Inception 04/29/2011
w/o sales charge 2.12% 1.58% 3.00% 2.79% 1.10% 1.16%
Lipper Category Avg. Inflation Protected Bond Funds - - - - - -
Bloomberg U.S. TIPS 1-5 Year Index 3.09% 2.77% 1.83% 3.07% 1.75% 1.55%
w/ sales charge 2.12% 1.58% 3.00% 2.79% 1.10% 1.16%

Fund Expense Ratio :

Gross 1.07%

Net 1.07%

Fund Expense Ratio :

Gross 1.07%

Net 1.07%

YTD 1-YR 3-YR 5-YR 10-YR Since Inception 04/29/2011
w/o sales charge 0.96% 2.82% 3.58% 2.22% 0.98% 1.08%
Lipper Category Avg. Inflation Protected Bond Funds -0.32% 1.65% -1.25% 1.87% 1.26% -
Bloomberg U.S. TIPS 1-5 Year Index 1.51% 2.84% 1.45% 2.67% 1.63% 1.44%

Fund Expense Ratio :

Gross 1.07%

Net 1.07%

Type Assets
Investment Grade Corporate
ABS
CLO
CMBS
High Yield Corporate
MBS
Bank Loans
U.S. Government Related
Cash
Maturity Assets
Less than 1 year
1-2.99 years
3-4.99 years
5-6.99 years
7-9.99 years

Credit Quality Distribution as of 10/31/2023 View Portfolio

Rating Assets
U.S. Treasury
Agency
AAA
AA
A
BBB
<BBB
Not Rated

INVESTMENT TEAM

Kewjin Yuoh
Kewjin Yuoh

Partner, Portfolio Manager

29 Years of Industry Experience

Andrew H. O'Brien
Andrew H. O'Brien, CFA

Partner, Portfolio Manager

25 Years of Industry Experience

Steven F. Rocco
Steven F. Rocco, CFA

Partner & Co-Head of Taxable Fixed Income

22 Years of Industry Experience

Leah G. Traub
Leah G. Traub, Ph.D.

Partner & Portfolio Manager

22 Years of Industry Experience

Robert A. Lee
Robert A. Lee

Partner & Co-Head of Taxable Fixed Income

32 Years of Industry Experience

Supported By 78 Investment Professionals with 16 Years Avg. Industry Experience

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Performance

Performance

Average Yield to Maturity as of 10/31/2023

7.00%

30-Day Standardized Yield 1 as of 10/31/2023  

  Subsidized2 Un-Subsidized3
w/o sales charge 4.75% 4.74%

Fund Expense Ratio :

Gross 1.07%

Net 1.07%

YTD 1-YR 3-YR 5-YR 10-YR Since Inception 04/29/2011
w/o sales charge 2.12% 1.58% 3.00% 2.79% 1.10% 1.16%
Lipper Category Avg. Inflation Protected Bond Funds - - - - - -
Bloomberg U.S. TIPS 1-5 Year Index 3.09% 2.77% 1.83% 3.07% 1.75% 1.55%
w/ sales charge 2.12% 1.58% 3.00% 2.79% 1.10% 1.16%

Fund Expense Ratio :

Gross 1.07%

Net 1.07%

Fund Expense Ratio :

Gross 1.07%

Net 1.07%

YTD 1-YR 3-YR 5-YR 10-YR Since Inception 04/29/2011
w/o sales charge 0.96% 2.82% 3.58% 2.22% 0.98% 1.08%
Lipper Category Avg. Inflation Protected Bond Funds -0.32% 1.65% -1.25% 1.87% 1.26% -
Bloomberg U.S. TIPS 1-5 Year Index 1.51% 2.84% 1.45% 2.67% 1.63% 1.44%

Fund Expense Ratio :

Gross 1.07%

Net 1.07%

Year Fund Returns Bloomberg U.S. TIPS 1-5 Year Index
2022 -5.11% -3.96%
2021 9.49% 5.53%
2020 5.42% 5.70%
2019 4.44% 5.08%
2018 -1.67% 0.41%
2017 0.93% 0.80%
2016 4.55% 3.13%
2015 -2.61% -0.14%
2014 -5.57% -1.13%
2013 -2.14% -1.96%
2012 9.98% -
2011 -3.62% -
Year Q1 Q2 Q3 Q4 Yearly Returns
2023 2.52% -1.14% -0.38% - 2.40%
2022 -0.51% -4.14% -2.30% 1.84% -5.11%
2021 4.09% 1.53% 2.17% 1.39% 9.49%
2020 -14.91% 10.27% 6.04% 5.95% 5.42%
2019 2.59% 0.22% -1.47% 3.10% 4.44%
2018 0.31% 0.85% 0.61% -3.38% -1.67%
2017 0.63% -1.62% 1.03% 0.91% 0.93%
2016 -1.00% -0.75% 2.44% 3.86% 4.55%
2015 -0.27% 1.62% -4.78% 0.93% -2.61%
2014 -0.07% 2.11% -2.84% -4.75% -5.57%
2013 0.48% -3.83% 1.23% 0.05% -2.14%
2012 5.47% -0.91% 3.16% 2.01% 9.98%
2011 - - -6.06% 2.16% -3.62%

NAV Historical Prices

Date Net Asset Value

Portfolio

Portfolio

Rating Assets
Investment Grade Corporate
ABS
CLO
CMBS
High Yield Corporate
MBS
Bank Loans
U.S. Government Related
Cash
Rating Assets
Less than 1 year
1-2.99 years
3-4.99 years
5-6.99 years
7-9.99 years

Credit Quality Distribution as of 10/31/2023

Rating Assets
U.S. Treasury
Agency
AAA
AA
A
BBB
<BBB
Not Rated

Portfolio Positioning as of 9/30/2023

  • The Fund maintains an allocation to CPI Swaps designed to protect investors’ purchasing power during periods of rising inflation. While inflation expectations were volatile over the quarter, they generally ended the period higher, leading to a modest positive impact on performance.
  • Over the quarter, the 2-year U.S. Treasury yield moved higher from 4.87% to 5.03% and the Treasury curve steepened as longer-term rates rose more. Therefore, the portfolio’s longer duration detracted from relative performance over the period.
  • The portfolio’s allocation to commercial mortgage-backed securities (CMBS) also dragged on relative performance, particularly within fixed and floating-rate single-asset, single borrower (SASB). Concerns about commercial real estate fundamentals continue to weigh on the market, and although valuations are compelling, we remain cautious about certain segments of commercial real estate. We continued to reduce the portfolio’s overall exposure to CMBS over the period, mainly within fixed and floating rate (SASB) securities. The portfolio’s current CMBS allocation is at its lowest weighting since the inception of the fund and well diversified across multifamily, lodging, office, industrial and retail properties. We maintain a high bar to add new positions, with a preference for high quality, liquid names.
  • Security selection within investment grade corporate bonds was the primary contributor to relative returns. More specifically, selection within the Financial and Energy sectors were positive contributors. We remain conservatively positioned in Financials, overweight large U.S. money center banks and European national champion banks. We are more cautious on smaller regional banks and monetized on some of the portfolio’s exposure here going into earnings season. The bank credits the portfolio holds are focused on institutions that have strong deposit franchises with robust credit cultures and strong management teams. Over the period, we modestly increased the portfolio’s exposure to investment grade corporate bonds, primarily within Financials.
  • The portfolio’s multi sector approach provided diversification benefits and contributed to relative returns, particularly within collateralized loan obligations (CLO) and asset-backed securities (ABS). Our CLO allocation is very short in maturity, highly rated, and exhibits low spread volatility. In regard to ABS, we continue to favor high-quality securities within the auto loan and consumer loan sectors, focusing on newly originated loans with superior underwriting.
  • The short-term, high yield allocation also contributed to relative performance over the quarter given the asset classes greater carry. Although our allocation to high yield corporate bonds is near historic lows given the reduced availability of yield-to-call names, we continue to seek opportunities in higher quality parts of the market, such as Energy, and idiosyncratic situations associated with mergers or credit events. 

Portfolio Details as of 10/31/2023

Total Net Assets
$1.25 B
Average Effective Duration
3.14 Years
Average Life
1.8 Years
Average Maturity
1.8 Years
Number of Issues
596
Average Yield to Maturity
7.00%

Dividends & Cap Gains

Dividends & Cap Gains

Dividend Payments

Dividend Payments

For
YTD Dividends Paidas of 12/01/2023
$0.38185
Dividend Frequency
Monthly (Daily Accrual)
Record Date Ex-Dividend Date Reinvest & Payable Date Dividend Reinvest Price
Daily Daily 11/30/2023 $0.03603 $11.34
Daily Daily 10/31/2023 $0.03387 $11.26
Daily Daily 09/30/2023 $0.03521 $11.28
Daily Daily 08/31/2023 $0.03641 $11.38
Daily Daily 07/31/2023 $0.03506 $11.49
Daily Daily 06/30/2023 $0.03586 $11.43
Daily Daily 05/31/2023 $0.03474 $11.47
Daily Daily 04/30/2023 $0.03669 $11.61
Daily Daily 03/31/2023 $0.03346 $11.67
Daily Daily 02/28/2023 $0.03042 $11.54
Daily Daily 01/31/2023 $0.03412 $11.59

Upcoming Dividend Payment Dates

Record Date Ex-Dividend Date Reinvest & Payable Date
Daily Daily 12/31/2023

Fees & Expenses

Fees & Expenses

Expense Ratioas of 10/31/2023

Fund Gross Expense Ratio Fund Net Expense Ratio
1.07% 1.07%

Fund Documents

Fund Documents

0Documents selected
Portfolio Holdings 1Q
Publish Date:11/03/2015
Portfolio Holdings 3Q
Publish Date:11/03/2015
Summary Prospectus
Publish Date:11/03/2015
Statutory Prospectus
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
Commentary
Publish Date:11/03/2015

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