A High Quality Bond Portfolio with Low Interest-Rate Exposure

Thornburg Low Duration Income Fund is a short-term portfolio of high-quality taxable bonds with low interest-rate exposure. With a duration normally around 1.5 years, the portfolio is designed to provide a home to investors who may have a limited time horizon.

Working Photo"The Thornburg Low Duration Income Fund seeks income in the context of low interest rate exposure and high-quality fixed income. All purchases must be investment grade, and with a five-year ladder weighted towards the front end of the yield curve, duration risk is expected to be small. While many portfolios in this category maximize credit risk in order to generate significant yield, we believe there is a place for a sensible portfolio of thoroughly researched fixed income securities."

— Lon Erickson

Low Interest-Rate Exposure

With a duration normally hovering around 1.5 years, Low Duration Income Fund is designed to have low exposure to fluctuations in interest rates.

It provides investors with a home on the short end of the yield curve, whether they are there in anticipation of short rates rising, or simply to have a relatively stable home for a short time period.

High Quality/Modest Credit Risk

Many portfolios and funds in this category attempt to make up for the relatively low yields attainable in the short end of the bond market by assuming additional credit risk.

While that can work in certain environments, it can backfire in others, and it’s simply not the goal of this portfolio to chase yield.

We assume a modest amount of credit risk commensurate with the fund’s goal of relative stability of principal.

A Five-Year Laddered Structure

Laddering is another means by which we mitigate some of the forms of risk inherent in bond investing. This portfolio can invest in maturities from one to five years.

Investing a relatively even amount in each year of the ladder gives us a predictable source of organic cash flows for reinvestment in every interest-rate environment, whether short rates are low, as they are now, or whether they are relatively high, as they were in 1999 and 2009.

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 carry risks, including possible loss of principal. Portfolios investing in bonds have the same interest rate, inflation, and credit risks that are associated with the underlying bonds. The value of bonds will fluctuate relative to changes in interest rates, decreasing when interest rates rise. Unlike bonds, bond funds have ongoing fees and expenses. Investments in mortgage backed securities (MBS) may bear additional risk. Investments in the Fund are not FDIC insured, nor are they bank deposits or guaranteed by a bank or any other entity.

Credit quality ratings for Thornburg’s global fixed income portfolios used ratings from Moody’s Investors Service. Where Moody’s ratings are not available, we have used Standard & Poor’s ratings. Where neither rating is available, we have used ratings from other NRSROs. U.S.-backed securities are included in AAA.

A bond credit rating assesses the financial ability of a debt issuer to make timely payments of principal and interest. Ratings of AAA (the highest), AA, A, and BBB are investment-grade quality. Ratings of BB, B, CCC, CC, C and D (the lowest) are considered below investment grade, speculative grade, or junk bonds.

The laddering strategy does not assure or guarantee better performance than a non-laddered portfolio and cannot eliminate the risk of investment losses.

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.