Investment Objectives
The Strategy seeks to obtain as high a level of current income exempt from regular federal individual income tax as is consistent, in the view of Thornburg, with preservation of principal. A secondary objective of the Strategy is to reduce expected fluctuations in the portfolio’s value compared to long-term bond portfolios. There is no guarantee that the Strategy will meet its objectives.
Principal Investment Strategies
The Strategy is a laddered portfolio of municipal bonds with an average maturity of three to ten years. Laddering involves building a portfolio of bonds with staggered maturities so that a portion of the portfolio matures each year; cash from maturing bonds is typically invested in bonds with longer maturities at the far end of the ladder. The portfolio is invested in municipal securities rated at the time of investment in the four highest categories of ratings services such as S&P, Moody’s, or Fitch, or in unrated securities judged by Thornburg to be comparable to securities rated in the four highest ratings categories. A portion of the Strategy's dividends could be subject to the federal Alternative Minimum Tax.
Supplemental Information as of 12/31/2011
| Returns (annualized for periods over one year) | |||||||
|---|---|---|---|---|---|---|---|
| QTR | YTD | 1-Year | 3-Year | 5-Year | 10-Year | Inception† | |
| Intermediate Term Term Municipal Composite (Net) | 2.24% | 9.48% | 9.48% | 8.00% | 4.90% | 4.61% | 5.32% |
| Intermediate Term Term Municipal Composite (Gross) | 2.38% | 10.05% | 10.05% | 8.69% | 5.60% | 5.36% | 6.16% |
| BofA Merrill Lynch 3-15 Yr Muni Index | 2.37% | 10.16% | 10.16% | 7.69% | 6.16% | 5.75% | - |
AAA
AA
A
BBB
Below Investment Grade
Not Rated| Current Portfolio Ladder | |||||||||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| % of bonds maturing in each year (The percentages can and do vary over time.) | Yr 10 | Yr 11 | Yr 12 | Yr 13 | Yr 14 | Yr 15 | Yr 16 | Yr 17 | Yr 18+ | ||||||||
| Yr 1 | Yr 2 | Yr 3 | Yr 4 | Yr 5 | Yr 6 | Yr 7 | Yr 8 | Yr 9 | |||||||||
8% | 4% | 4% | 4% | 5% | 5% | 7% | 7% | 7% | 6% | 7% | 7% | 7% | 4% | 4% | 4% | 2% | 8% |
† Inception 11/1/1991
Valuations are computed and performance is reported in U.S. dollars.
Source: Advent/APX, FactSet, and Thornburg.
Portfolio characteristics are derived using currently available data from independent research resources that are believed to be accurate.
1The performance data quoted represents past performance; it does not guarantee future results. The data provided is derived from gross-of-fee performance and does not reflect the deduction of management fees.
The BofA Merrill Lynch 3-15 Year U.S. Municipal Securities Index (which was retroactively added on July 1, 2009, as a benchmark to the composite) is a subset of the BofA Merrill Lynch U.S. Municipal Securities Index including all securities with a remaining term to final maturity greater than or equal to 3 years and less than 15 years. From composite inception until December 31, 2011, one benchmark for the composite was the BofA Merrill Lynch 7-12 Year U.S. Municipal Securities Index. Effective December 31, 2011, the BofA Merrill Lynch 3-15 Year U.S. Municipal Securities Index became the sole benchmark for the composite because it better reflects management’s philosophy of laddering along the yield curve (while the BofA Merrill Lynch 7-12 Year U.S. Municipal Securities Index has asset allocations concentrated around much fewer maturities).
Thornburg Investment Management, Inc. (the “Firm”) is an independent investment adviser registered under the Investment Advisers Act of 1940. The Firm’s clientele consists of mutual funds, commingled funds and taxable and non-taxable separately managed accounts in U.S., non-U.S. and global equity strategies and in U.S. fixed income strategies. The Firm been independently verified for the period July 1, 1998 through December 31, 2010. The verification reports are available upon request. Policies for valuing portfolios, calculating performance, and preparing compliant presentations are available upon request.
Thornburg Investment Management claims compliance with the Global Investment Performance Standards (GIPS®)
Click here to view the Intermediate Term Municipal Composite GIPS compliant presentation.
To receive a complete list and description of Thornburg Investment Management's composites please contact MCG at mcg@thornburg.com.
| Portfolio Managers |
|---|
“The municipal bond market is made up of tens of thousands of issuers and over a million unique bonds. We sift through the market every day to find what we believe are opportunities to extract large rewards for very little risk.”
– Portfolio Managers
