The Tax-Advantaged Ultra-Short Fixed Income Fund posted a 0.24% return in the first quarter, as income was strong enough to offset the price declines of late March. The Funds one-year total return was 0.63%, versus 0.47% for the blended benchmark. During the quarter, the portfolios floating-rate bond position cushioned price volatility as intended.
We maintained duration near one year, primarily by using fixed-rate two- and three-year municipal bonds along with municipal and corporate floating-rate notes. We utilize taxable corporate bonds when their after-tax yield exceeds the return on tax-free municipal bonds. Taxable bonds made up approximately 30% of the portfolio throughout the first quarter.
If you're seeking an investment that may generate higher yields than money market funds with less volatility than short duration bond funds, this Fund may be appropriate for you. The Fund is intended for investors with an investment horizon of at least one year who are seeking to move a portion of their money market fund assets.
The Fund is not a money market fund, which maintains a $1.00 NAV, and the Fund's share price will fluctuate with its returns.
- Seek to provide investors in higher tax brackets more after-tax yield than a money market fund with potential for capital appreciation.
- Strive to maximize after-tax return by pursuing best net after-tax yield and total return opportunities in both taxable and tax-exempt securities.
- Strive to maintain a 6-18 month average maturity, under normal circumstances, with a maximum security maturity of three years. Also manage Fund in an effort to have an average portfolio quality of A or better, with all securities to be investment grade.