The flexibility to seek value broadly

Thornburg Value Fund is a focused portfolio of mostly U.S. companies, selected via a fundamentally driven, valuation-sensitive process. The fund is centered on providing attractive, risk-adjusted returns with mitigated volatility versus the benchmark S&P 500 Index.

Working Photo“We are fundamental, bottom-up stock pickers. We have the flexibility to seek value broadly, employing our basket structure to ensure diversification. We want each holding to matter to fund performance; we therefore keep the portfolio focused amongst just 35–65 positions. Since 1995, we have worked to invest in promising companies selling at a discount to their intrinsic values. We believe this approach to be a durable and common-sense investment strategy. Importantly, it has worked over the long term for our investors.”

— Connor Browne

A Flexible Approach

Like other Thornburg strategies, Value Fund is flexible in its approach. We have the ability to invest anywhere along the capitalization spectrum, within or outside the U.S. Our flexibility allows us to go wherever we see value.

Seeking Promising Companies at a Discount

Thornburg Value Fund has never been a deep-value portfolio seeking only beaten-up, tired businesses trading at low multiples. Rather, we believe that future price appreciation can belong to businesses with a bright future, businesses with promise.

We employ more flexibility than other value strategies in that the companies we consider tend to have attractive growth prospects. We don’t limit ourselves to a traditional, one-dimensional view of value.

Diversification via a Three-Basket Approach

We focus on constructing a core portfolio with potential to outperform its benchmark over time. We diversify the portfolio via several means, one of which is Thornburg’s three-basket diversification construct:

Basic value companies are, in our opinion, financially sound, well-established businesses selling at low valuations relative to net assets or earnings power.

Consistent earners normally exhibit steady earnings growth, cash-flow characteristics, and/or dividend growth. These companies may have above-average profitability measures, and may sell at above-average valuations.

Emerging franchises are often in the process of establishing a leading position in a product, service, or market, or have the potential to grow at an above-average rate.

A Regular, Repeatable Process

We have selected stocks via a bottom-up, collaborative, repeatable process since the fund’s inception almost 20 years ago.

Significant Tax-Loss Carryforwards

The fund has accumulated tax-loss carryforwards equivalent to more than half of total assets; the fund should be a particularly tax-efficient investment vehicle until the carryforwards are exhausted.

A Note on Performance

After successfully navigating the great financial crisis and outperforming the S&P 500 Index by 19% in 2009, performance disappointed during 2011 and the first half of 2012. We were tempted by big discounts in cyclical/volatile investment opportunities and became overly exposed to investments with basic value characteristics in that risk-on/ risk-off environment. We corrected course in mid-2012, bolstering the consistent earner characteristics of the portfolio and recommitting to the philosophy and approach that had worked so well from 1995 through year-end 2010. Since mid-2012, risk characteristics and overall performance have significantly improved.
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.

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

Funds invested in a limited number of holdings may expose an investor to greater volatility.

As of August 1, 2009, Thornburg Investment Management no longer offers Class B Shares. See the current prospectus for more information.

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.