Mutual Funds
Long Duration Corporate Bond Fund
Fund Managers
Mark Montgomery, CFA®
Peter Brown, CFA®
Robert Brown, CFA®
Overview
R6
Shares
STRFX
Inception
Date
02.01.2022
Investment
Min.
N/A
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.
| Term | Class A Shares | Class C Shares | Class I Shares | Class R6 Shares |
|---|---|---|---|---|
| Ticker | SCCMX | SCCNX | SCCPX | STRFX |
| Inception Date | 02.01.2013 | 02.01.2013 | 02.01.2013 | 02.01.2022 |
| Investment Min. | $1,000 | $1,000 | $1,000,000 | N/A |
| Subsequent Investment Min.2 | N/A | N/A | N/A | N/A |
| Max. Up Front Sales Charge | 2% | N/A | N/A | N/A |
| Max. Deferred Sales Charge | N/A | 1% | N/A | N/A |
2If subsequent investments are made as part of an AIP, the minimum is $25.
Co-Portfolio Manager
Co-Portfolio Manager
Co-Portfolio Manager
Performance
| Term | QTR | YTD | 1 Year | 3 Years | 5 Years | 10 Years | Since Inception |
|---|---|---|---|---|---|---|---|
| A Shares with 2.00% Sales Charge | -3.21% | -5.09% | 0.01% | -7.56% | -2.55% | 0.18% | 1.35% |
| A Shares without Sales Charge | -1.29% | -3.13% | 2.00% | -6.92% | -2.16% | 0.38% | 1.51% |
| Institutional Shares | -1.23% | -3.02% | 2.25% | -6.70% | -1.94% | 0.63% | 1.72% |
| Lipper Corp Debt BBB Rated Median | N/A | N/A | N/A | N/A | N/A | N/A | N/A |
The gross expense ratios for Class A, C and I Shares are 0.95%, 1.70% and 0.70%, respectively. The net expense ratios for Class A, C, and I Shares are 0.91%, 1.66% and 0.66%, respectively.
The Advisor has contractually agreed to limit certain fees paid by the Fund from February 1, 2021 through January 31, 2022. 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 Corporate 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. Performance for Class A Shares, Class C 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 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 03.31.2024
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.
| Name | Value |
|---|---|
| 0-2 Yr. | 0.27 |
| 2-4 Yr. | 0.65 |
| 4-6 Yr. | 0.95 |
| 6-8 Yr. | 2.80 |
| 8-10 Yr. | 10.10 |
| 10-12 Yr. | 18.79 |
| 12-14 Yr. | 26.16 |
| 14-16 Yr. | 27.91 |
| 16-18 Yr. | 10.29 |
| 20+ Yr. | 2.09 |
Current and future portfolio holdings are subject to change and risk. Based on Market Value of securities.
| Name | Value |
|---|---|
| Number of Holdings | 368 |
| Average Life | 22.25 Years |
| Effective Duration | 12.68 Years |
| Annual Turnover | 23% |
| Composition | Fund | Index |
|---|---|---|
| Corporate | 95.7% | 100.0% |
| Financial Institutions | 18.4% | 16.5% |
| Industrial | 62.4% | 70.5% |
| Utility | 14.9% | 12.9% |
| Government Related | 0.2% | 0.0% |
| Agency | 0.2% | 0.0% |
| Securitized | 0.4% | 0.0% |
| CMBS | 0.4% | 0.0% |
| Treasury | 1.6% | 0.0% |
| Treasury | 1.6% | 0.0% |
| Cash | 2.1% | 0.0% |
| Cash | 2.1% | 0.0% |
| # | Company Name | Value |
|---|---|---|
| 1 | JP Morgan Chase & Co. 3.109% 22-Apr-2041 | 0.88% |
| 2 | U.S. Treasury 2.0% 15-Nov-2041 | 0.85% |
| 3 | AT&T Inc. 3.85% 01-Jun-2060 | 0.85% |
| 4 | Wells Fargo & Company 5.375% 02-Nov-2043 | 0.81% |
| 5 | Anheuser-Busch Companies, Llc. 4.9% 01-Feb-2046 | 0.72% |
| 6 | UnitedHealth Group Incorporated 3.5% 15-Aug-2039 | 0.71% |
| 7 | Bank Of America Corporation 2.676% 19-Jun-2041 | 0.70% |
| 8 | Aercap Ireland Capital Dac 3.85% 29-Oct-2041 | 0.69% |
| 9 | Boeing Company 5.705% 01-May-2040 | 0.68% |
| 10 | AT&T Inc. 4.5% 15-May-2035 | 0.65% |
Current and future portfolio holdings are subject to change and risk. Based on Market Value of securities.
Growth of $10,000 as of 03.31.2024
The Growth of $10,000 is hypothetical based upon the performance of net A Shares at NAV for the period ended 03.31.2024. It includes the reinvestment of dividends and capital gains.
Distribution
| Month | Class A Shares | Class C Shares | Class Inst'l Shares | Class R6 Shares |
|---|---|---|---|---|
| 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 |
| November 2023 | $0.0247 | $0.0206 | $0.0260 | $0.0265 |
| October 2023 | $0.0256 | $0.0215 | $0.0268 | $0.0273 |
| September 2023 | $0.0242 | $0.0200 | $0.0256 | $0.0261 |
| August 2023 | $0.0248 | $0.0206 | $0.0262 | $0.0268 |
| July 2023 | $0.0247 | $0.0205 | $0.0262 | $0.0267 |
| Share Class | Without Waivers | With Waivers |
|---|---|---|
| Class A | 4.89% | 4.98% |
| Class C | 4.29% | 4.29% |
| Class I | 5.25% | 5.34% |
| Class R6 | 5.24% | 5.25% |
Long Duration Corporate Bond Fund
Materials
Fixed Income Funds
Insights
07.02.2024
Sterling Capital Management LLC joins Guardian Capital Group Limited
Sterling Capital Management LLC announced today the completion of its acquisition by Guardian Capital LLC, a wholly-owned subsidiary of global asset manager Guardian Capital Group Limited.
06.27.2024 • Jeffrey Ormsby, CFA®
Fixed Income and Federal Reserve Rate Cuts: How Should We Expect Fixed Income to Perform?
As one would expect, in most historical periods where interest rates were declining, fixed income total return has been good, with investors capturing the coupon income as well as benefiting from the increase in prices as rates fall. Looking at the history of the Bloomberg Aggregate Bond Index since 1988, in the previous five Federal Reserve (Fed) rate-cutting cycles, the index posted annualized returns averaging north of 8%.
06.13.2024 • Andrew Richman, CTFA
When It Comes to Fed Policy, Follow the Data, Not the Dots
Andy Richman's update on the June Federal Open Market Committee meeting.
06.05.2024 • Charles Wittmann, CFA®
The Lead - "An Indicator of Business Confidence"
- Several notable companies have elected to inaugurate a quarterly dividend this year, while 47 companies in the U.S. stopped paying dividends during the COVID-19 crisis and have yet to reinstitute one. Why? - We would suggest it comes down to the ability to pay an ever-increasing dividend alongside their confidence in their business’s future. - In the current period of fewer dividend initiations, slower dividend growth in the market, and household names cutting their dividends, we believe there are several lessons to learn.
05.31.2024
Today Sterling Capital announces the resignation of Shawn M. Gallagher, CFA®, Co-Portfolio Manager of the firm’s Mid Cap Relative Value and Real Estate strategies, effective immediately. Andrew T. DiZio, CFA®, who served as Co-Portfolio Manager on both strategies, will now serve as sole Portfolio Manager for both strategies, effective immediately.
05.07.2024 • Charles Wittmann, CFA®
The Lead - "Dividends for Offense and Defense"
- What could be a catalyst for dividend yielding equities in 2024? - We discuss three considerations: inexpensive valuations relative to history; valuations for dividend yield versus growth; and how both have a history of performing well after positive economic surprises. - Why do dividend payers perform well as the economy surprises to the upside? We provide several possible reasons.
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