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Total Return Bond Fund

Mutual Funds

Total Return Bond Fund


Fund Managers

Photo of Mark  Montgomery

Mark Montgomery, CFA®

Photo of Peter  Brown

Peter Brown, CFA®

Overview

A
Shares

BICAX

Inception
Date

12.02.1999

Investment
Min.

$1,000

Subsequent
Investment Min.1

N/A

Max. Up Front
Sales Charge

5.75%

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 5 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, 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

Term Class A Shares Class C Shares Class I Shares Class R6 Shares
Ticker BICAXBICCXBIBTXSTRDX
Inception Date 12.02.199902.01.200112.02.199902.01.2018
Investment Min. $1,000$1,000$1,000,000N/A
Subsequent Investment Min.2 N/AN/AN/AN/A
Max. Up Front Sales Charge 5.75%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.

Total Return 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

Performance

Fund Performance as of 06.30.2023

Term QTR YTD 1 Year 3 Years 5 Years 10 Years Since Inception
A Shares with 5.75% Sales Charge -6.31% -3.60% -6.71% -5.40% -0.26% 1.17% 3.73%
A Shares without Sales Charge -0.61% 2.29% -0.97% -3.51% 0.93% 1.76% 3.99%
Institutional Shares -0.55% 2.42% -0.62% -3.24% 1.19% 2.02% 4.24%
Lipper Core Bond Median -0.83% 2.26% -0.88% -3.71% 0.72% 1.50% N/A

The total expense ratios for Class A, C and I Shares are 0.70%, 1.45% and 0.45%, respectively. The gross expense ratio for Class R6 Shares is 0.45%. The net expense ratio for Class R6 Shares is 0.35%.

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 average daily net assets for the period 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 Total Return 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 12.02.1999. The inception date for Class C Shares is 02.01.2001. The inception date for Class Inst'l Shares is 12.02.1999. The inception date for Class R6 Shares is 02.01.2018. The performance of Class C Shares is adjusted to reflect the 1% contingent deferred sales charge. The performance shown reflects the reinvestment of all dividend and capital gains distributions.

Characteristics

Quality Breakdown as of 06.30.2023

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 06.30.2023

Name Value
5-10 Yr. 6.0
0-1 Yr. 4.0
1-2 Yr. 7.0
2-3 Yr. 27.0
3-5 Yr. 39.0
5-10 Yr. 14.0

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

Summary Statistics as of 06.30.2023

Name Value
Number of Holdings 339
Average Life 9.12 Years
Effective Duration 6.30 Years
Annual Turnover 56%

Portfolio Composition as of 06.30.2023

Composition Fund Index
Corporate 25.4% 24.8%
    Financial Institutions 10.4% 8.1%
    Industrial 12.2% 14.6%
    Utility 2.9% 2.2%
Government Related 5.6% 5.1%
    Agency 0.8% 1.9%
    Local Authority 4.8% 0.8%
    Sovereign 0.0% 1.0%
    Supranational 0.0% 1.3%
Securitized 52.5% 29.1%
    ABS 11.2% 0.5%
    CMBS 12.6% 1.7%
    CMO 2.0% 0.0%
    MBS Passthrough 26.7% 27.0%
Treasury 15.2% 40.9%
    Treasury 15.2% 40.9%
[Cash] 1.3% 0.0%
    [Cash] 1.3% 0.0%

Top Ten Holdings as of 06.30.2023

# Company Name Value
1 U.S. Treasury 4.125% 15-11-32 6.51%
2 U.S. Treasury 2.5% 15-2-45 3.89%
3 U.S. Treasury 1.375% 15-8-50 2.86%
4 U.S. Treasury 2.625% 15-2-29 1.86%
5 OneMain Fin. Issuance Trust 2021-1 1.55% 16-6-36 1.68%
6 FNMA 30Yr Fs1475 3.500% 1-4-52 1.32%
7 Hertz Vehicle Financing III Series 2021-2 1.68% 25-12-27 1.28%
8 OneMain Direct Auto Rec. Trust 2023-1 5.41% 14-11-29 1.19%
9 FHLMC 30Yr Sd3107 4.000% 1-3-53 1.09%
10 FNMA 30Yr Fs1185 3.500% 1-4-52 1.03%

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

Growth of $10,000 as of 06.30.2023

The Growth of $10,000 is hypothetical based upon the performance of net A Shares at NAV for the period ended 06.30.2023. It includes the reinvestment of dividends and capital gains.

Distribution

Monthly Dividend Distribution as of 08.31.2023

Month Class A Shares Class C Shares Class Inst'l Shares Class R6 Shares
August 2023 $0.0267 $0.0209 $0.0286 $0.0294
July 2023 $0.0259 $0.0201 $0.0279 $0.0286
June 2023 $0.0246 $0.0190 $0.0266 $0.0274
May 2023 $0.0247 $0.0187 $0.0267 $0.0274
April 2023 $0.0235 $0.0178 $0.0255 $0.0263
March 2023 $0.0238 $0.0179 $0.0257 $0.0265
February 2023 $0.0218 $0.0164 $0.0236 $0.0243
January 2023 $0.0220 $0.0161 $0.0240 $0.0248
December 2022 $0.0219 $0.0160 $0.0239 $0.0247
November 2022 $0.0215 $0.0159 $0.0233 $0.0241
October 2022 $0.0212 $0.0155 $0.0231 $0.0239
September 2022 $0.0198 $0.0141 $0.0218 $0.0225

30-Day SEC Yield as of 08.31.2023

Share Class Without Waivers With Waivers
Class A 3.80% 3.84%
Class C 3.13% 3.17%
Class I 4.13% 4.16%
Class R6 4.13% 4.19%

Fixed Income Funds

Insights

preview of document

09.21.2023 • Andrew Richman, CTFA

Fed Reiterates-Higher for Longer

While the Federal Reserve (Fed) met expectations with a pause/skip this meeting, the real story was the upward movement in both the Fed Funds rate this year and next year. The consensus is now for one more 25 basis point hike in 2023 with the Fed funds rate median at 5.60%.

preview of document

09.07.2023 • Shane Burke

An Updated Look at the FOMC and Yield Curve

An Updated Look at the FOMC and Yield Curve

09.06.2023 • Charles Wittmann, CFA®

The Lead - "Balancing Yield"

- One of the risks in seeking higher dividend yields in non-financial companies can be the increased balance sheet leverage that correlates with higher dividend yield. - For many companies, the cost of this leverage is rising with interest rates, potentially placing pressure on cash flows to pay future dividends as interest expense may take a greater share of corporate cash flow. - We believe that owning stocks with strong balance sheets has the potential to minimize this risk as we endeavor to generate attractive above-average total returns with below-average risk for clients.

preview of document

08.02.2023 • Andrew Richman, CTFA

Fitch Lowers Long-Term U.S. Debt Rating from AAA to AA+

Fitch Lowers Long-Term U.S. Debt Rating from AAA to AA+

08.01.2023 • Charles Wittmann, CFA®

The Lead - "Long-Term Dividends"

- What are the investing environment conditions that can cause dividend payers to lag on a short-term basis? - Looking back at Bloomberg data over the past twenty years, when dividend payers outperformed the Russell 1000 Value, non-earners underperformed and vice versa (56% of the time). - Over the twenty year period, dividend payer’s quarterly outperformance outweighed underperformance in contrast to non-earners. - In our quest to generate above-average returns with below-average risk for our clients, our approach is to take advantage of the long-term benefits of dividend payers that grow their dividends and seek to create value now and in the future.

preview of document

07.25.2023 • Andrew DiZio, CFA®

Real Estate Returns Following Fed Rate Hike Cycles

Over the last 15 months, the Federal Reserve (Fed) has meaningfully raised the benchmark fed funds rate in an effort to tamp down inflation. The Fed paused its hiking campaign during the June meeting, but issued an outlook suggesting additional rate increases are to be expected. Regardless of whether the Fed has finished raising rates, we believe the end of the tightening cycle is near and view now as a prudent time to examine the performance of Real Estate Investment Trust (REIT) stocks following historical periods of fed funds increases.

Contact

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