A Global Search for Growing Income & Price Appreciation

Thornburg Investment Income Builder is a globally oriented portfolio whose aim is to provide an attractive and growing income stream, with capital appreciation, over time. A dynamic blend of global dividend-paying stocks and bonds of virtually any type, Income Builder is broadly flexible in pursuit of its objectives.

Working Photo "The portfolio’s goals are to provide interesting current income, and over the long term, to grow that income on a per-share basis. The direct consequence of success in those two is likely to be capital appreciation. Because global dividend-paying stocks are so well suited to the above goals, our portfolio has generally been, and is likely to continue to be, dominated by that asset class. Fixed income and other income-generating asset classes are also important to the portfolio. If we’re able to find companies that show both an ability and willingness to pay shareholders a significant portion of earnings, and those companies are in a position to create value over time through growth, we may find continued success."

— Brian McMahon

We Go Where The Income Is

Global Diversification Can Improve Yield
U.S. corporations have historically reinvested capital in businesses rather than returning it to shareholders in the form of dividends. But in overseas markets with stronger dividend-paying cultures, this tendency is reversed.

Yields are often higher in Canada, Europe, Australia, Latin America, even China. See the index data in the chart below.

Looking Beyond Utilities
Investors sometimes think of high dividend yields as limited to the utilities or telecom sectors, but we search for promising dividend payers in a range of sectors and geographies.

We see interesting income levels in U.S. telecoms (4.6%), and in U.K. financials (4.6%) and utilities (5.4%), for example.*

*Average dividend yield estimates per MSCI country and regional indices. Europe excludes the United Kingdom. Sourced via Bloomberg, as of June 30, 2014.

Ability and Willingness
We apply Thornburg’s global generalist orientation in a worldwide search for companies with the ability and willingness to distribute earnings to shareholders.

2015 Estimated Yield, MSCI Country Indices

2015 Estimated Yield MSCI Country Indices

Supporting Role: Bonds of Any Type

Fixed income plays a supporting role in the portfolio, aiding in income production and potentially muting volatility over time. And in the Income Builder portfolio, we don’t limit ourselves to bonds of a particular type or credit quality in the search for the best risk/reward trade-off. Bonds have ranged from around 10% today to more than 40% of fund assets.

Beyond Current Yield

Investors tend to focus on current yield, or current income divided by current price. While useful, current yield is only a snapshot. It can be helpful to look beyond it — to yield on cost, which is annual income divided by the cost of an initial investment — reflecting an investor’s yield on their original purchase.

If one were to invest a hypothetical $100,000 in a security with a current yield of 5% at purchase, and income grew by 50% over time, the yield on cost of the initial investment would have grown from 5% to 7.5%.

The Importance of Per-Share Cash Flow

With both declining price and declining income, an investor can experience a current yield that remains level. Similarly, with a rising price and flat income, current yield would decline. So as investors choose which vehicles to use for income, it’s important that they understand per-share cash flow (the actual dollar amount of income received per share) as a true measure of income — along with current yield and yield on cost.

Important Information
Before investing, carefully consider the Fund’s investment goals, risks, charges, and expenses. For a prospectus or summary prospectus containing this and other information, contact your financial advisor or visit our literature center. Read them carefully before investing.

Investments in the Fund carry risks, including possible loss of principal. Special risks may be associated with investments outside the United States, especially in emerging markets, including currency fluctuations, illiquidity, volatility, and political and economic risks. Investments in small capitalization companies may increase the risk of greater price fluctuations. Investments in the Fund are not FDIC insured, nor are they deposits of or guaranteed by a bank or any other entity.

The performance of any index is not indicative of the performance of any particular investment. Unless otherwise noted, index returns reflect the reinvestment of income dividends and capital gains, if any, but do not reflect fees, brokerage commissions or other expenses of investing. Investors may not make direct investments into any index.

Thornburg Investment Income Builder Fund‘s Blended Index is composed of 25% Barclays U.S. Aggregate Bond Index and 75% MSCI World Index, rebalanced monthly.

Diversification does not assure or guarantee better performance and cannot eliminate the risk of investment losses.

Dividends are not guaranteed.

Class R shares are limited to retirement platforms only.

Class I shares may not be available to all investors. Minimum investments for the I share class may be higher than those for other classes.

There is no guarantee that the Fund will meet its investment objectives.

Please see our glossary for a definition of terms.

Thornburg mutual funds are distributed by Thornburg Securities Corporation.

Thornburg Investment Management, Inc. mutual funds are sold through investment professionals including investment advisors, brokerage firms, bank trust departments, trust companies and certain other financial intermediaries. Thornburg Securities Corporation (TSC) does not act as broker of record for investors.