Seeking Income from High-Quality U.S. Dollar-Denominated Bonds

Thornburg Limited Term Income Fund is a flexible, actively managed, core portfolio of high-quality U.S. dollar-denominated bonds. This centerpiece investment-grade portfolio seeks a reasonable level of income and lower volatility than some peers, without overextending in the pursuit of yield.

Working Photo"The Limited Term Income Fund is designed to range across the investment-grade bond market to look for the best opportunities available in the context of a high quality, laddered portfolio. As the vast majority (around 85%) of the U.S.-dollar investment-grade bond market matures within 10 years, we believe that we can provide a large portion of the reward of U.S. bonds without much of the heavy interest rate risk in the longer end of the yield curve. We will continue to strive to bring as much income as is consistent with lower volatility and a focus on balancing risk with reward."

— Jason Brady

A High-Quality Core Portfolio

In bond investing, nothing is more important than determining whether the party to whom you propose to lend money has the ability and willingness to pay you back. Rigorous research into the fundamental creditworthiness of an issuer is critical.

In the Limited Term Income portfolio, issuer credit quality is high, with 58% of the portfolio rated A or better.

Flexibility

As with other Thornburg portfolios, flexibility is key. While Limited Term Income is structured as a 10-year ladder, we enjoy the flexibility to invest wherever we see the most value. Analysts and portfolio managers are expected to be conversant across a wide range of asset classes and geographies.

Lower Volatility

Limited Term Income Fund is a 10-year laddered portfolio, managed with an eye toward mitigated volatility. Of course, markets are inherently volatile at times, so some price movement is to be expected. But through careful credit research and portfolio construction, we seek to mute price change.

Seeking Reasonable Income

Many “core” investment-grade bond funds seek to enhance yield by extending duration, lowering credit quality, and even through the use of leverage. While the Limited Term Income Fund is flexible in pursuit of its goals, we keep things reasonable. We want a reasonable level of income commensurate with a moderate level of risk assumption; we won’t assume undue risk in pursuit of a few extra basis points.

An Actively Managed Ladder

Laddering involves building a portfolio of staggered maturities so that a portion will mature each year. Money from maturing bonds provides an organic source of cash flow and is typically reinvested in longer-maturity bonds within the range of the ladder. In the case of Limited Term Income, the ladder ranges from zero to 10 years.

Best Fixed Income Fund Family

2012 Lipper Fund Award2012 – The firm ranked #1 out of 41 eligible firms in Lipper Inc.'s fixed income large firm universe for the three-year period ended 11/30/11.

2008 – The firm ranked #1 out of 41 eligible firms in Lipper Inc.'s fixed income large firm universe for the three-year period ended 12/31/07.

The Lipper Fund Awards program honors funds that have excelled in delivering consistently strong risk-adjusted performance, calculated with dividends reinvested and without sales charges, relative to peers. The Lipper Fund Awards program recognizes fund families with high average scores for all funds within a particular asset class or overall. Fund family awards are issued for the three-year period only. Thornburg did not win the awards for any years other than those listed above. Lipper’s Large Company universe was comprised of fund families with more than $40 billion in total net assets for the 2012 award and more than $28 billion for the 2008 award. Only fund families with at least five bond funds were eligible for the Fund Family Award.
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.

Class R shares are limited to retirement platforms only.

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.