Low Duration Fund

Investment Objective

Total return consisting of income and capital appreciation

Morningstar Category
Ultrashort Bond

Fund Characteristics

The Low Duration Fund strives to outperform the risk-free rate while maintaining a diversified portfolio of high quality, liquid fixed income securities. The Fund only invests in securities rated A or higher.

Investment Approach

  • Combines macro-economic impacts to determine the expected future path of interest rates and economic cycles with fundamental research to help identify relative value and desirable characteristics
  • Primary emphasis on quality, liquidity, and diversification
  • The broad sectors represented in the portfolio will include corporate debt securities issued by domestic and foreign companies, mortgage-backed securities, and asset-backed securities
  • The Fund will invest exclusively in investment grade securities rated in the highest three categories at the time of purchase by at least one of the nationally recognized statistical rating organizations

Why Consider This Fund?

  • May offer the potential for higher yields than cash instruments
  • Focus on capital preservation
  • Ability to provide liquidity in volatile markets
  • Limited interest rate risk may help to protect investors against an unexpected rise in interest rates
  • Tenured team that is dedicated to active fixed income
  • Time-tested, repeatable investment process that has demonstrated the ability to generate consistent, competitive returns
  • Team-based approach within a global investment boutique

The Fund’s returns will vary, and you could lose money by investing in the Fund.   The Fund’s investments in obligations issued or guaranteed by U.S.  Government agencies or instrumentalities may not be backed by the full faith and credit of the United States and may differ in the degree of support provided by the U.S. Government.  As interest rates rise, bond prices will fall and bond funds become more volatile. The Fund is subject to credit risk. The Fund’s net asset value and total return may be adversely affected by the inability of the issuers of the Fund’s securities to make interest payments or payment at maturity.  International investing involves special risk considerations, including currency fluctuations, lower liquidity, economic and political risk. Investing in emerging markets can increase these risks, including higher volatility and lower liquidity. The Fund’s investments in collateralized mortgage obligations are subject to prepayment and extension risk. Prepayment of high interest rate mortgage-backed securities during times of declining interest rates will tend to lower the return of the Fund and may even result in losses to the Fund if the prepaid securities were acquired at a premium. Slower prepayments during periods of rising interest rates may increase the duration of the Fund’s mortgage-backed securities and asset-backed securities and reduce their value.  This is not a money market fund. Rule 144A securities are not registered for resale in the general securities market and may be classified as illiquid. It may not be possible to sell or otherwise dispose of illiquid securities both at the price and within a time period deemed desirable by the Fund. Derivatives may involve certain costs and risks such as liquidity, interest rate, market, credit, management and the risk that a position could not be closed when most advantageous. Investing in derivatives could lose more than the amount invested.