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Securitized Opportunities Fund

Securitized Opportunities Fund    Fact Sheet


Overall Morningstar Rating™

  

Morningstar Category: Intermediate-Term Bond

*Based on risk-adjusted returns among 902 funds as of 09.30.2018.
High
Med.
Low
Ltd.Mod.Ext.

Morningstar Style Box

A Shares (SCSSX)
Inception: 02.01.2013
C Shares (SCSTX)
Inception: 02.01.2013
Inst'l Shares (SCSPX)
Inception: 02.01.2013

Philosophy and Process

In managing the fund, the portfolio management team employs a multi-faceted approach to generate excess return and uses a combination of top-down and bottom-up analysis, quantitative vs. qualitative analysis and fundamentals vs. valuation. There is a strong emphasis on risk management and an adherence to certain core investment beliefs:

  • "If you cannot measure it; you cannot manage it."
  • Avoid unintended exposures
  • Average duration around 2 to 5 years with focus on high quality and risk management
  • Participate in longer term trends - don't buy on short-term trends or try to time what is going on in the market
  • Attempts to achieve risk-adjusted performance over time

Investment Considerations

The fund is subject to the same risks as the underlying bonds in the portfolio such as credit, prepayment, call and interest rate risk. As interest rates rise the value of bond prices will decline. The fund may invest in more aggressive investments such as foreign securities which may expose the fund to currency and exchange rate fluctuations; derivatives (futures and swaps); mortgage backed securities sensitive to interest rates and high yield debt (also known as junk bonds), all of which may cause greater volatility and less liquidity. Derivatives may be more sensitive to changes in market conditions and may amplify risks.

Fund Facts

Class A Shares Class C Shares Class Inst'l Shares
Ticker SCSSXSCSTXSCSPX
Inception Date 02.01.201302.01.201302.01.2013
Investment Min. $1,000.00$1,000.00$1,000,000.00
Subsequent Investment Min.* $0.00$0.00$0.00
Max. Up Front Sales Charge 2.00%N/AN/A
Max. Deferred Sales Charge N/A1.00%N/A
*If subsequent investments are made as part of an AIP, the minimum is $25.

Management

Michael Z. Sun, CFA ®
Michael Z. Sun, CFA ®

Executive Director

View Biography
Jeffrey D. Ormsby, CFA ®
Jeffrey D. Ormsby, CFA ®

Director

View Biography
Byron G. Mims, CFA ®
Byron G. Mims, CFA ®

Director

View Biography

Performance

Fund Performance as of 09.30.2018

QTR YTD 1 Year 3 Years 5 Years Since
Inception
A Shares with 2.00% Sales Charge -2.00% -2.82% -2.60% 0.60% 1.70% 2.03%
A Shares without Sales Charge 0.02% -0.86% -0.63% 1.27% 2.11% 2.31%
Institutional Shares 0.09% -0.56% -0.28% 1.59% 2.41% 2.54%
Lipper U.S. Mortgage Median -0.15% -1.08% -1.05% 0.82% 1.87% N/A

The gross expense ratios for Class A, C and I Shares are 0.89%, 1.64% and 0.64%, respectively. The net expense ratios for Class A, C and I Shares are 0.85%, 1.60% and 0.60%, respectively. The Advisor has contractually agreed to limit certain fees paid by the Fund from February 1, 2018 through January 31, 2019. Performance would have been lower without limitations in effect.

Past performance does not guarantee future results. The performance data quoted represents past performance and current returns may be lower or higher. The investment return and principal value of an investment will fluctuate so that an investor's shares, when redeemed, may be worth more or less than the original cost. To obtain performance information current to the most recent month end, please visit the performance summary.

The performance of the Securitized Opportunities Fund reflects the deduction of fees for value-added services associated with a mutual fund, such as investment management and fund accounting fees. The inception date for Class A Shares is 02/01/2013. The inception date for Class C Shares is 02/01/2013. The inception date for Class Inst'l Shares is 02/01/2013. Performance for Class A Shares, Class C Shares and Institutional Shares for periods prior to inception on February 1, 2013 is based on performance of Class S Shares of the Fund which were re-designated as Institutional Shares as of February 1, 2013. Class A Shares, Class C Shares and Institutional Shares of the Fund would have substantially similar performance because the Shares are invested in the same portfolio of securities and the performance would differ only to the extent that the Classes have different expenses. The performance shown reflects the reinvestment of all dividend and capital gains distributions.


Characteristics

Quality Breakdown as of 09.30.2018

Credit quality ratings using Moody's rating symbols reflect the credit quality of the underlying bonds in the fund portfolio and not of the Fund itself. Moody's assigns a range of ratings from Aaa being the highest quality to C being the lowest rated class of bonds. Securities not rated by Moody's may be rated by S&P, Fitch or if no agency rating is available, the Fund will assign a rating of not rated. Bond quality ratings are subject to change.

Effective Duration Breakdown as of 09.30.2018

Name Value
0-1 Yr. 14.1
1-2 Yrs. 8.2
2-3 Yrs. 5.8
3-5 Yrs. 20.3
5-10 Yrs. 41.5
10+ Yrs. 10.1

Summary Statistics as of 09.30.2018

Name Value
Number of Holdings 133
Average Life 6.52 Years
Effective Duration 4.99 Years
Annual Turnover 19

Current and future portfolio holdings are subject to change and risk. Based on Market Value of securities.

Portfolio Composition as of 09.30.2018

Composition Fund Index
Corporate 0.9% 0.0%
     Industrial 0.9% 0.0%
Securitized 98.4% 100.0%
     ABS 23.1% 0.0%
     CMBS 28.5% 0.0%
     CMO 26.9% 0.0%
     MBS Passthrough 20.0% 100.0%
Cash & Equivalents 0.6% 0.0%
     Cash & Equivalents 0.6% 0.0%

Top Ten Holdings as of 09.30.2018

Name Value
Americredit Automobile Receivables Trust, Series 2017-1 2.71% 18-Aug-2022 2.11%
Wells Fargo Commercial Mortgage Trst, Ser 2010-C1, Cl B 5.28% 18-Jan-2038 2.10%
Hertz Vehicle Financing, LLC, Series 2015-3A, Class A 2.67% 25-Sep-2021 1.98%
Freddie Mac REMICS, Series 3762, Class LN 4.00% 18-Jan-2038 1.80%
FNMA, Pool #AN9354 3.64% 01-Jun-2028 1.60%
Fannie Mae Remics, Series 2005-110, Class GL 5.50% 01-Dec-2035 1.52%
Citibank Credit Card Issuance Trust 6.15% 18-Jan-2038 1.49%
Encore Credit Receivables Trust, Series 2005-4, Cl M2 2.66% 25-Jan-2036 1.47%
Freddie Mac Remics 4.75% 18-Jan-2038 1.45%
WF-RBS Commercial Mortgage Trst, Series 2014-C22, Cl A5 3.75% 18-Jan-2038 1.43%

Current and future portfolio holdings are subject to change and risk. Based on Market Value of securities.

Growth of $10,000 as of 09.30.2018

The Growth of $10,000 chart is hypothetical based upon the performance of A Shares at NAV for the period ended 09/30/2018. It includes the reinvestment of dividends and capital gains.

Glossary of Terms

Distribution

Monthly Dividend Distribution as of 10.31.2018

Month Class A Shares Class C Shares Class Inst'l Shares
October 2018 $0.0237 $0.0174 $0.0255
September 2018 $0.0363 $0.0306 $0.0385
August 2018 $0.0226 $0.0164 $0.0247
July 2018 $0.0231 $0.0171 $0.0253
June 2018 $0.0229 $0.0169 $0.0249
May 2018 $0.0224 $0.0163 $0.0245
April 2018 $0.0226 $0.0166 $0.0246
March 2018 $0.0219 $0.0157 $0.0241
February 2018 $0.0219 $0.0160 $0.0235
January 2018 $0.0213 $0.0150 $0.0234
December 2017 $0.0208 $0.0147 $0.0230
November 2017 $0.0207 $0.0146 $0.0228

30-Day SEC Yield as of 10.31.2018

Without Waivers With Waivers
Class A 3.03% 3.07%
Class C 2.35% 2.39%
Class I 3.35% 3.39%

Materials

Fact Sheet
Monthly Holdings
Fund Reports
Fund Reports

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The Morningstar Rating™ for funds, or "star rating", is calculated for managed products (including mutual funds, variable annuity and variable life subaccounts, 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.


STERLING CAPITAL FUNDS ARE:

Not a deposit - Not FDIC insured - Not guaranteed by the bank - Not insured by any government agency - May lose value

An investor should consider a fund's investment objectives, risks, and charges and expenses carefully before investing or sending money. This and other important information about the Sterling Capital Funds can be found in the Funds' prospectus. To obtain a prospectus, please call 1 (888) 228-1872 or click here. Please read the prospectus carefully before investing.

Sterling Capital Management LLC, a separate subsidiary of BB&T Corporation, serves as investment adviser to the Sterling Capital Funds and is paid a fee for its services as described in the prospectus. Shares of the Sterling Capital Funds are not deposits or obligations of, or guaranteed or endorsed by, Branch Banking and Trust Company or its affiliates. The Funds are not insured by the FDIC or any other government agency. The Funds are distributed by Sterling Capital Distributors LLC, which is not affiliated with Branch Banking and Trust Company or its affiliates.