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Short Duration Income Fund

Summary

Summary

What is the Short Duration Income Fund?

The Fund seeks to deliver a high level of current income consistent with the preservation of capital by investing in a variety of short maturity debt securities including, corporate bonds, U.S. government securities, and mortgage- and other asset-backed debt securities.

EXPERIENCED, TENURED TEAM

Managed through collaboration among 40+ investment professionals in portfolio management, credit research, and trading.

STRATEGIC, FLEXIBLE DESIGN

Pursues an agile, multi-sector approach designed to provide a higher yield than a typical short duration strategy, and a lower duration than a traditional core bond strategy.

STRONG PERFORMANCE

Has offered a track record of solid performance in many market environments. 

Yield

Dividend Yield 1 as of 02/15/2019  

w/o sales charge 3.97%

30-Day Standardized Yield 2 as of 01/31/2019  

3.39%

Fund Basicsas of 12/31/2018

Total Net Assets
$41.69 B
Inception Date
10/19/2004
Dividend Frequency
Monthly
Fund Expense Ratio
0.39%
Number of Holdings
1561
CUSIP
543916688
Minimum Initial Investment
$1,000,000+

Fund Expense Ratio :

0.39%

YTD 1-YR 3-YR 5-YR 10-YR Since Inception 10/19/2004
w/o sales charge 0.82% 2.41% 3.02% 2.23% 4.34% 4.01%
Lipper Category Avg. Short Investment Grade Debt Funds 0.71% 1.84% 1.87% 1.25% 2.63% -
ICE BofAML 1-3 Year U.S. Corporate Index 0.70% 2.51% 2.12% 1.70% 3.39% 3.15%

Fund Expense Ratio :

0.39%

Fund Expense Ratio :

0.39%

YTD 1-YR 3-YR 5-YR 10-YR Since Inception 10/19/2004
w/o sales charge 1.43% 1.43% 2.70% 2.13% 4.55% 3.97%
Lipper Category Avg. Short Investment Grade Debt Funds 1.03% 1.02% 1.67% 1.17% 2.64% -
ICE BofAML 1-3 Year U.S. Corporate Index 1.62% 1.62% 1.97% 1.62% 3.50% 3.12%

Fund Expense Ratio :

0.39%

RELATED CONTENT

Gauging the Opportunity in Short Duration Credit
January 28, 2019

Short-term securities such as corporate bonds, ABS, and CMBS, recently offered yields near multi-year highs, with lower volatility than core bonds.

The Appeal of Short Duration Credit in Strategic Cash Management
December 17, 2018

Yields more than compensate cash managers for taking on minimal credit risk.

Volatility Worries? Consider This Diversified Approach to Income
November 26, 2018

A strategic combination of ultra-short and short-term fixed-income securities, along with bank loans, may be an attractive option for income and total return amid market turmoil.

Type Assets
CMBS
Investment Grade Corporate
ABS
High Yield Corporate
Bank Loans
U.S. Government Related
MBS
Sovereign
Other
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 12/31/2018 View Portfolio

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

Investment Team

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

Partner & Portfolio Manager

21 Years of Industry Experience

Kewjin Yuoh
Kewjin Yuoh

Partner & Portfolio Manager

25 Years of Industry Experience

Steven F. Rocco
Steven F. Rocco, CFA

Partner & Director of Taxable Fixed Income

18 Years of Industry Experience

Robert A. Lee
Robert A. Lee

Partner & Chief Investment Officer

28 Years of Industry Experience

Supported By 66 Investment Professionals with 14 Years Avg. Industry Experience

Contact a Representative

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Performance

Performance

Dividend Yield 1 as of 02/15/2019  

w/o sales charge 3.97%

30-Day Standardized Yield 2 as of 01/31/2019  

  Subsidized3 Un-Subsidized4
w/o sales charge 3.39% 3.39%

Fund Expense Ratio :

0.39%

YTD 1-YR 3-YR 5-YR 10-YR Since Inception 10/19/2004
w/o sales charge 0.82% 2.41% 3.02% 2.23% 4.34% 4.01%
Lipper Category Avg. Short Investment Grade Debt Funds 0.71% 1.84% 1.87% 1.25% 2.63% -
ICE BofAML 1-3 Year U.S. Corporate Index 0.70% 2.51% 2.12% 1.70% 3.39% 3.15%

Fund Expense Ratio :

0.39%

Fund Expense Ratio :

0.39%

YTD 1-YR 3-YR 5-YR 10-YR Since Inception 10/19/2004
w/o sales charge 1.43% 1.43% 2.70% 2.13% 4.55% 3.97%
Lipper Category Avg. Short Investment Grade Debt Funds 1.03% 1.02% 1.67% 1.17% 2.64% -
ICE BofAML 1-3 Year U.S. Corporate Index 1.62% 1.62% 1.97% 1.62% 3.50% 3.12%

Fund Expense Ratio :

0.39%

Year Fund Returns ICE BofAML 1-3 Year U.S. Corporate Index
2018 1.43% 1.62%
2017 2.73% 1.91%
2016 3.97% 2.39%
2015 0.86% 1.01%
2014 1.70% 1.19%
2013 1.82% 1.78%
2012 6.84% 4.49%
2011 3.35% 1.76%
2010 6.58% 4.86%
2009 17.22% 14.69%
2008 -0.43% -
2007 6.26% -
2006 3.90% -
2005 1.28% -
2004 0.09% -
Year Q1 Q2 Q3 Q4 Yearly Returns
2019 - - - - 1.00%
2018 -0.22% 0.55% 0.55% 0.54% 1.43%
2017 1.00% 0.74% 0.73% 0.23% 2.73%
2016 1.29% 1.74% 0.80% 0.09% 3.97%
2015 1.24% 0.34% -0.35% -0.37% 0.86%
2014 0.96% 0.97% -0.11% -0.13% 1.70%
2013 0.74% -0.78% 1.00% 0.85% 1.82%
2012 2.47% 0.84% 2.13% 1.24% 6.84%
2011 0.90% 1.14% -0.58% 1.86% 3.35%
2010 2.28% 1.13% 2.43% 0.59% 6.58%
2009 4.13% 5.61% 4.72% 1.78% 17.22%
2008 1.21% 1.40% -1.76% -1.24% -0.43%
2007 1.57% 0.18% 2.09% 2.30% 6.26%
2006 0.37% 0.36% 2.28% 0.85% 3.90%
2005 -0.38% 1.46% -0.15% 0.36% 1.28%
2004 - - - - 0.09%

NAV Historical Prices

Date Net Asset Value

Portfolio

Portfolio

Type Assets
CMBS
Investment Grade Corporate
ABS
High Yield Corporate
Bank Loans
U.S. Government Related
MBS
Sovereign
Other
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 12/31/2018

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

Portfolio Positioning as of 12/31/2018

  • The portfolio maintained its diversified exposure to various credit-sensitive sectors of the market beyond the corporate bonds represented in its benchmark, the ICE BofA Merrill Lynch 1-3 Year U.S. Corporate Index.
  • We continue to hold the view that U.S. domestic growth will separate from global weakness. Despite the recent market volatility and the downturn of some soft economic indicators, we are cautiously optimistic in the U.S. economy due to the strength in the labor market. We remain focused on domestic opportunities given the potential for increased volatility and event risk abroad.  For example, we find that domestically-focused areas of the market, such as commercial mortgage-backed securities and asset-backed securities that are backed by credit card receivables and auto loans, offer relative value and strong carry opportunities.
  • After realizing profits in the high yield credit space earlier in the year due to spread tightening, we added exposure to investment grade corporate bonds as spreads widened during the quarter. We remain constructive on the fundamental and technical factors of this market segment and believe that the volatility experienced in the fourth quarter resulted in idiosyncratic opportunities to capture relative value, particularly within “BBB” rated debt.
  • We also increased the portfolio’s allocation to commercial mortgage-backed securities during the fourth quarter. We maintain a positive outlook for the commercial real estate sector, particularly within single-asset, single-borrower deals, as we believe this sector offers attractive risk-adjusted returns.
  • We reduced the portfolio’s exposure to U.S. government related securities during the quarter to take advantage of spread widening in short-term credit sectors.

Portfolio Details as of 12/31/2018

Total Net Assets
$41.69 B
Number of Issues
1561
Average Coupon
4.05%
Average Life
2.45 Years
Average Maturity
2.45 Years
Average Effective Duration
2.04 Years