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Short Duration Bond Fund

Short Duration Bond Fund    Fact Sheet


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Morningstar Style Box

A Shares (BSGAX)
Inception: 11.30.1992
C Shares (BBSCX)
Inception: 02.01.2012
Inst'l Shares (BBSGX)
Inception: 11.30.1992

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 between 1-3 years with focus on high quality and risk management
  • Have flexibility in creating higher yielding total return portfolio while reducing interest rate sensitivity, protecting principal and allowing for return potential
  • 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 BSGAXBBSCXBBSGX
Inception Date 11.30.199202.01.201211.30.1992
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

Mark M. Montgomery, CFA ®
Mark M. Montgomery, CFA ®

Senior Managing Director

View Biography
Richard T. LaCoff
Richard T. LaCoff

Senior Managing Director

View Biography

Performance

Fund Performance as of 09.30.2018

QTR YTD 1 Year 3 Years 5 Years 10 Years Since
Inception
A Shares with 2.00% Sales Charge -1.32% -1.43% -1.49% 0.51% 0.64% 1.56% 3.26%
A Shares without Sales Charge 0.64% 0.62% 0.55% 1.18% 1.05% 1.76% 3.34%
Institutional Shares 0.71% 0.81% 0.80% 1.44% 1.30% 2.02% 3.59%
Lipper Short Investment Grade Median 0.53% 0.60% 0.58% 1.28% 1.12% 2.34% N/A

The gross expense ratios for Class A, C and I Shares are 0.80%, 1.55% and 0.55%, respectively. The net expense ratios for Class A, C and I Shares are 0.70%, 1.45% and 0.45%, 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 Short Duration Bond 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 11/30/1992. The inception date for Class C Shares is 02/01/2012. The inception date for Class Inst'l Shares is 11/30/1992. Performance for Class C Shares for periods prior to inception is based on the performance of Class A Shares of the Fund. 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 as of 09.30.2018

Name Value
0-1 Yr. 34.7
1-2 Yrs. 41.1
2-3 Yrs. 23.1
3-5 Yrs. 1.1

Summary Statistics as of 09.30.2018

Name Value
Number of Holdings 226
Average Life 1.68 Years
Effective Duration 1.35 Years
Annual Turnover 62

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 65.0% 24.9%
     Financial Institutions 32.7% 11.7%
     Industrial 30.4% 12.1%
     Utility 1.9% 1.1%
Government Related 2.7% 13.2%
     Agency 1.5% 8.1%
     Local Authority 1.3% 0.7%
     Sovereign 0.0% 1.1%
     Supranational 0.0% 3.3%
Securitized 28.5% 0.0%
     ABS 18.5% 0.0%
     CMBS 8.1% 0.0%
     CMO 1.9% 0.0%
Treasury 2.3% 62.0%
     Treasury 2.3% 62.0%
Cash & Equivalents 1.4% 0.0%
     Cash & Equivalents 1.4% 0.0%

Top Ten Holdings as of 09.30.2018

Name Value
U.S. Treasury Notes 1.38% 31-May-2020 2.35%
Santander Drive Auto Receivables Trust, Ser 2016, Cls C 3.09% 15-Apr-2022 1.26%
Hertz Vehicle Financing, LLC, Series 2015-1A, Class A 2.73% 25-Mar-2021 1.21%
Morgan Stanley Capital I Trust, Seris 2016-BNK2, Cls A2 2.45% 18-Jan-2038 1.11%
Bank of America Corp. 2.15% 09-Nov-2020 0.95%
WF-RBS Commercial Mortgage Trust, Series 2011-C3, Cl A4 4.38% 18-Jan-2038 0.93%
Carmax Auto Owner Trust, Series 2016-2, Class A4 1.68% 15-Sep-2021 0.93%
Comm Mortgage Trust, Series 2014-CR15, Class A2 2.93% 18-Jan-2038 0.91%
Morgan Stanley 2.65% 27-Jan-2020 0.91%
Enterprise Fleet Financing, LLC 2.22% 20-Jan-2023 0.89%

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 $0.0198 $0.0143 $0.0216
September 2018 $0.0179 $0.0126 $0.0196
August 2018 $0.0185 $0.0130 $0.0203
July 2018 $0.0186 $0.0132 $0.0204
June 2018 $0.0180 $0.0127 $0.0197
May 2018 $0.0182 $0.0128 $0.0201
April 2018 $0.0176 $0.0124 $0.0194
March 2018 $0.0182 $0.0127 $0.0200
February 2018 $0.0174 $0.0124 $0.0190
January 2018 $0.0182 $0.0127 $0.0200
December 2017 $0.0181 $0.0126 $0.0199
November 2017 $0.0178 $0.0125 $0.0196

30-Day SEC Yield as of 10.31.2018

Without Waivers With Waivers
Class A 2.49% 2.59%
Class C 1.80% 1.89%
Class I 2.76% 2.86%

Materials

Fact Sheet
Monthly Holdings
Fund Reports
Fund Reports

© 2018 Morningstar. All Rights Reserved. The information contained herein: (1) is proprietary to Morningstar and/or its content providers; (2) may not be copied or distributed; and (3) is not warranted to be accurate, complete or timely. Neither Morningstar nor its content providers are responsible for any damages or losses arising from any use of this information. Past performance is no guarantee of future results.

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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.