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Long Duration Corporate Bond Fund

Mutual Funds

Long Duration Corporate Bond Fund


Fund Managers

Photo of Mark  Montgomery

Mark Montgomery, CFA®

Photo of Peter  Brown

Peter Brown, CFA®

Photo of Robert  Brown

Robert Brown, CFA®

Overview

I
Shares

SCCPX

Inception
Date

02.01.2013

Investment
Min.

$1,000,000

Subsequent
Investment Min.1

N/A

Max. Up Front
Sales Charge

N/A

Max. Deferred
Sales Charge

N/A

1If subsequent investments are made as part of an AIP, the minimum is $25.

Philosophy & 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 3 to 7 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, 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); 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

Term Class A Shares Class C Shares Class I Shares Class R6 Shares
Ticker SCCMXSCCNXSCCPXSTRFX
Inception Date 02.01.201302.01.201302.01.201302.01.2022
Investment Min. $1,000$1,000$1,000,000N/A
Subsequent Investment Min.2 N/AN/AN/AN/A
Max. Up Front Sales Charge 2%N/AN/AN/A
Max. Deferred Sales Charge N/A1%N/AN/A

2If subsequent investments are made as part of an AIP, the minimum is $25.

Long Duration Corporate Bond Fund

Management

View professional designations disclosures

Photo of Mark  Montgomery

Mark Montgomery, CFA®

Co-Portfolio Manager

Photo of Peter  Brown

Peter Brown, CFA®

Co-Portfolio Manager

Photo of Robert  Brown

Robert Brown, CFA®

Co-Portfolio Manager

Performance

Fund Performance as of 09.30.2024

Term QTR YTD 1 Year 3 Years 5 Years 10 Years Since Inception
A Shares with 2.00% Sales Charge 5.28% 1.96% 15.96% -5.30% -1.47% 0.94% 1.11%
A Shares without Sales Charge 7.43% 4.07% 18.30% -4.68% -1.07% 1.14% 1.28%
Institutional Shares 7.50% 4.26% 18.43% -4.45% -0.85% 1.38% 2.24%
Lipper Corp Debt BBB Rated Median 5.65% 5.35% 14.21% -1.36% 1.15% 2.78% N/A

The total expense ratios for Class A, C, and I Shares are 0.71%, 1.46% and 0.46%, respectively. The gross expense ratio for Class R6 Shares is 0.67%. The net expense ratio for Class R6 Shares is 0.36%.

The Advisor has contractually agreed to limit certain fees paid by the Fund from 02.01.2024-01.31.2025. Performance would have been lower without limitations in effect. The Fund Administrator, Sterling Capital Management LLC, has contractually agreed to waive its administrative fees, pay Fund operating expenses, and/or reimburse the Fund .10% of the Class R6 avg. daily net assets for the period 02.01.2024-01.31.2025. 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 Sterling Capital Long Duration Corporate 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 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. The inception date for Class R6 Shares is 02.01.2022. The performance shown reflects the reinvestment of all dividend and capital gains distributions. Performance is annualized for periods greater than one year.

Performance for Class A Shares and Institutional Shares for periods prior to inception is based on performance of Class S Shares of the Fund which were re-designated as Institutional Shares as of 02.01.2013. The inception date for Class S Shares was 06.30.2011. Class A 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. 

Characteristics

Quality Breakdown as of 09.30.2024

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 09.30.2024

Name Value
0-2 Yr. 0.43
2-4 Yr. 0.36
4-6 Yr. 0.89
6-8 Yr. 3.44
8-10 Yr. 9.58
10-12 Yr. 15.70
12-14 Yr. 24.88
14-16 Yr. 29.67
16-18 Yr. 13.49
18+ Yr. 1.56

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

Summary Statistics as of 09.30.2024

Name Value
Number of Holdings 378
Average Life 22.51 Years
Effective Duration 13.16 Years
Annual Turnover 28%

Portfolio Composition as of 09.30.2024

Composition Fund Index
Corporate 94.4% 100.0%
     Financial Institutions 19.6% 16.8%
     Industrial 60.1% 70.1%
     Utility 14.7% 13.1%
Government Related 0.2% 0.0%
     Agency 0.2% 0.0%
Securitized 0.4% 0.0%
     CMBS 0.4% 0.0%
Treasury 3.2% 0.0%
     Treasury 3.2% 0.0%
Cash 1.9% 0.0%
     Cash 1.9% 0.0%

Top Ten Holdings as of 09.30.2024

# Company Name Value
1 U.S. Treasury 2.0% 15-Nov-2041 2.34%
2 Jpmorgan Chase & Co. 3.109% 22-Apr-2041 0.82%
3 At&t Inc. 3.85% 01-Jun-2060 0.78%
4 Wells Fargo & Company 5.375% 02-Nov-2043 0.74%
5 Anheuser-Busch Companies, Llc. 4.9% 01-Feb-2046 0.65%
6 Bank Of America Corporation 2.676% 19-Jun-2041 0.65%
7 Amgen Inc. 5.6% 02-mar-2043 0.61%
8 Aercap Ireland Capital Dac 3.85% 29-Oct-2041 0.59%
9 Oneok, Inc. 5.85% 01-nov-2064 0.59%
10 At&t Inc. 4.5% 15-may-2035 0.59%

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

Growth of $10,000 as of 09.30.2024

The Growth of $10,000 is hypothetical based upon the performance of net A Shares at NAV for the period ended 09.30.2024. It includes the reinvestment of dividends and capital gains.

Distribution

Monthly Dividend Distribution as of 07.31.2024

Month Class A Shares Class C Shares Class Inst'l Shares Class R6 Shares
July 2024 $0.0262 $0.0215 $0.0276 $0.0282
June 2024 $0.0256 $0.0210 $0.0270 $0.0276
May 2024 $0.0266 $0.0219 $0.0280 $0.0286
April 2024 $0.0261 $0.0220 $0.0274 $0.0280
March 2024 $0.0255 $0.0209 $0.0269 $0.0276
February 2024 $0.0237 $0.0191 $0.0251 $0.0257
January 2024 $0.0253 $0.0204 $0.0267 $0.0273
December 2023 $0.0253 $0.0207 $0.0268 $0.0274

30-Day SEC Yield as of 09.30.2024

Share Class Value
Class A 4.42%
Class C 3.73%
Class I 4.77%
Class R6 4.86%

Fixed Income Funds

Insights

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11.22.2024 • Shane Burke

Meet Shane Burke, Sterling Capital Advisory Solutions Portfolio Manager

Sterling Capital is pleased to share a closer look at Shane Burke, our Advisory Solutions Portfolio Manager. In this spotlight, he shares his professional experience and advice, and his hidden talent. It’s great to have you on our team, Shane! Thank you for everything you do, and for sharing this with us.

11.18.2024 • Andrew Richman, CTFA

Fed Begins to Ease... Rates Rise?

Andy Richman's update on the November Federal Open Market Committee meeting.

11.05.2024 • Charles Wittmann, CFA®

The Lead - Equity Yield Curve

- We have shared the qualities we seek in the companies we invest in and how we research their perceived competitive advantage, but what advantage can an investor have?
- As investment timeframes have become more short term, we have found the long end of the equity yield curve is less competitive and may “yield” more opportunities.
- The concept of the equity yield curve is helpful to visualize how patience can create value.

10.01.2024 • Charles Wittmann, CFA®

The Lead - Margin of Upside

- One of the most common mental shortcuts is regression to the mean, or the idea that outcomes far from average will revert to average over time.
- Where did the idea come from, is it true in every case, and can it create a greater understanding and yield profitable insights?
- Finally, if there are advantaged companies that challenge this assumption as the economy has evolved, what valuations will the market typically award them?

09.30.2024

Sterling Capital Equity Portfolio Management Updates

Sterling Capital announces the creation of the Insight Equity Group, combining the firm's Fundamental Equity and Relative Value teams, along with the April 2025 retirement of Patrick Rau, CFA®/.

09.18.2024 • Brandon Carl, CFA®

U.S. Equity Market Performance Following the First Fed Funds Rate Cut

After two and a half years of battling elevated inflation with aggressive monetary policy tightening measures, the Federal Reserve (Fed) finally reduced the federal funds target rate range (fed funds rate) by 50 basis points during its September 2024 meeting. With recent inflation indicators seemingly within the Fed’s comfort zone, coupled with an increasing emphasis on supporting the labor market, we believe it’s highly likely that additional rate cuts are forthcoming.

Contact

Learn more about Sterling Capital solutions and services.

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© 2024 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.

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.

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