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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 08/16/2019  

w/o sales charge 3.87%

30-Day Standardized Yield 2 as of 07/31/2019  

2.97%

Fund Basicsas of 07/31/2019

Total Net Assets
$50.95 B
Inception Date
06/30/2015
Dividend Frequency
Monthly
Fund Expense Ratio
0.39%
Number of Holdings
1774

Fund Expense Ratio :

0.39%

YTD 1-YR 3-YR 5-YR 10-YR Since Inception
w/o sales charge 4.32% 5.11% 2.93% 2.58% 3.70% -
Lipper Category Avg. Short Investment Grade Debt Funds 3.18% 3.93% 1.99% 1.60% 2.26% -
ICE BofAML 1-3 Year U.S. Corporate Index 3.60% 4.94% 2.34% 2.12% 2.86% -

Fund Expense Ratio :

0.39%

Fund Expense Ratio :

0.39%

YTD 1-YR 3-YR 5-YR 10-YR Since Inception
w/o sales charge 3.98% 5.12% 3.01% 2.49% 3.94% -
Lipper Category Avg. Short Investment Grade Debt Funds 3.09% 4.04% 2.06% 1.55% 2.43% -
ICE BofAML 1-3 Year U.S. Corporate Index 3.47% 5.06% 2.37% 2.08% 3.00% -

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.

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.

How Short Duration Could Offer Stability in a Volatile Market
June 4, 2018

As U.S. Treasury yields have moved higher in the past few months, how have short-maturity fixed-income securities held up?

Type Assets
Investment Grade Corporate
ABS
CMBS
High Yield Corporate
Bank Loans
U.S. Government Related
Sovereign
MBS
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 07/31/2019 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 67 Investment Professionals with 15 Years Avg. Industry Experience

Contact a Representative

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Performance

Performance

Dividend Yield 1 as of 08/16/2019  

w/o sales charge 3.87%

30-Day Standardized Yield 2 as of 07/31/2019  

  Subsidized3 Un-Subsidized4
w/o sales charge 2.97% 2.97%

Fund Expense Ratio :

0.39%

YTD 1-YR 3-YR 5-YR 10-YR Since Inception
w/o sales charge 4.32% 5.11% 2.93% 2.58% 3.70% -
Lipper Category Avg. Short Investment Grade Debt Funds 3.18% 3.93% 1.99% 1.60% 2.26% -
ICE BofAML 1-3 Year U.S. Corporate Index 3.60% 4.94% 2.34% 2.12% 2.86% -

Fund Expense Ratio :

0.39%

Fund Expense Ratio :

0.39%

YTD 1-YR 3-YR 5-YR 10-YR Since Inception
w/o sales charge 3.98% 5.12% 3.01% 2.49% 3.94% -
Lipper Category Avg. Short Investment Grade Debt Funds 3.09% 4.04% 2.06% 1.55% 2.43% -
ICE BofAML 1-3 Year U.S. Corporate Index 3.47% 5.06% 2.37% 2.08% 3.00% -

Fund Expense Ratio :

0.39%

Year Fund Returns ICE BofAML 1-3 Year U.S. Corporate Index
2018 1.43% 1.62%
2017 2.50% 1.91%
2016 3.97% 2.39%
2015 0.85% 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% -
Year Q1 Q2 Q3 Q4 Yearly Returns
2019 2.23% 1.72% - - 4.51%
2018 0.02% 0.31% 0.79% 0.30% 1.43%
2017 0.77% 0.74% 0.73% 0.23% 2.50%
2016 1.05% 1.74% 1.04% 0.09% 3.97%
2015 1.24% 0.34% -0.34% -0.38% 0.85%
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%

NAV Historical Prices

Date Net Asset Value

Portfolio

Portfolio

Type Assets
Investment Grade Corporate
ABS
CMBS
High Yield Corporate
Bank Loans
U.S. Government Related
Sovereign
MBS
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 07/31/2019

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

Portfolio Positioning as of 06/30/2019

  • The portfolio maintained its diversified exposure to various credit-sensitive sectors of the market beyond the corporate bonds represented in its benchmark, the ICE BofAML 1-3 Year U.S. Corporate Index.
  • Following the volatility and spread widening that occurred in May, we increased the portfolio’s allocation to investment grade corporate bonds, focusing on the “BBB” credit tier. Given our views on an accommodative U.S. Federal Reserve (“Fed”) policy, we believe further spread tightening will occur. We continue to favor securities within the financials and utilities sectors. While generally underweight consumer non-cyclicals, we have increased the portfolio’s allocation to the consumer staples sector, as we believe this sector is more defensive. Although we believe event risks associated with merger and acquisition activity exist within the sector, we are focusing on issuers that are unlikely to undergo additional leveraging events.
  • We also continued to increase the portfolio’s allocation to bank loans. We believe short-term bank loans present attractive opportunities for additional yield generation, given the inversion within the U.S. Treasury yield curve. Additionally, we believe the market’s expectations for Fed easing from the standpoint of timing or degree are overdone.
  • We reduced the portfolio’s allocation to high yield corporate bonds in the beginning of the quarter, as credit spreads tightened. While we used the spread widening that occurred in May to modestly add back high yield exposure across sectors, we continued to reduce the high yield allocation as credit spreads resumed tightening in June.
  • Following the significant tightening in commercial mortgage-backed security (CMBS) spreads, we reduced the portfolio’s allocation to the asset class. However, we continue to maintain a positive outlook in the commercial real-estate sector, particularly within single-asset, single-borrower deals, but we do not foresee CMBS spreads to accelerate at the same rate.

Portfolio Details as of 07/31/2019

Total Net Assets
$50.95 B
Number of Issues
1774
Average Coupon
3.86%
Average Life
2.39 Years
Average Maturity
2.39 Years
Average Effective Duration
1.80 Years