M.D. Sass Short Term US Government Agency Income Fund

Overview | Fund Facts & Characteristics | Performance & Statistics | Fact Sheets

Overview

  • The Fund invests exclusively in the U.S. Government Agency Mortgage Backed securities market. This is one of the largest and liquid high quality markets in the world with over $5 trillion in assets, ranging in duration from less than 1 year to 30 years.
  • It is also one of the least understood markets and, therefore, offers the potential for exceptionally high-yield.
  • M.D. Sass rigorously analyzes securities in the 1 to 3 year duration range and carefully selects those with the highest yield and appreciation potential from among only those that have very stable cash flows.
  • In addition to the U.S. Government Agency guarantee, we focus on securities that we believe are composed of underlying mortgages that are very high quality even without the U.S. Government Agency guarantee because the underlying borrowers have very favorable FICO scores and the mortgages have low loan-to-value ratios, small average loan sizes, desirable geographies, broad diversification, and are offered at attractive yields.
  • M.D. Sass frequently sells securities when and as they become fairly valued and we add value by re-investing the proceeds into undervalued similar securities.
  • In rising interest rate environments, the monthly underlying mortgage principal and interest payments act like a laddered portfolio that can be rapidly reinvested when and as interest rates rise.

Morningstar Rating

MDSIX 3-Star Overall Morningstar Rating™ as of 9/30/17 out of 104 Short-Term Government Funds

The Overall Morningstar Rating™ for a fund is derived from a weighted average of the fund's three- and five-year Morningstar Rating™ metrics, which are based on risk-adjusted return performance.

 

Cash Flow - In the case of the Bond Fund, cash flows are comprised of the principal and interest payments made towards the home mortgages that underlie the U.S. Agency Mortgage Backed Securities the Fund invests in. For Equity Income Plus, cash flow from the sale of covered calls is the premium received by the writer of the call options.

For each fund with at least a three-year history, Morningstar calculates a Morningstar Rating (based on a Morningstar risk-adjusted return measure that accounts for variation in a fund's monthly performance, including the effects of sales charges, loads, and redemption fees), placing more emphasis on downward variations and rewarding consistent performance. The top 10% of funds in each category receive 5 stars, the next 22.5% receive 4 stars, the next 35% receive 3 stars, the next 22.5% receive 2 stars and the bottom 10% receive 1 star. As of 9/30/17, the MD Sass Short Term US Government Agency Income Fund was rated 3-Stars against the following numbers of Short Government funds over the following time periods: 104 funds in the last three- and 94 funds in the last five-years. The M.D. Sass Equity Income Plus Fund (Institutional Class) was rated 3 stars against the following numbers of Option Writing Funds over the following time periods: 79 funds in the last three years.