03-21-2014 03:50 AM
USAA Investments received one of the most prestigious accolades at the Lipper 2014 U.S. Fund Awards ceremony, held March 20 in New York.
USAA won the Best Fixed Income Large Fund Group award, presented annually to the mutual fund family whose fixed-income funds generated the highest rating for relative risk-adjusted return over the three-year period ended December 31, 2013. USAA previously won this award in 2004.
“It was great to win this award the first time, and it’s even better to repeat,” says Matt Freund, chief investment officer for USAA Mutual Funds. “We’re really going about our business in the same way as we did 10 years ago. We have the same consistent, team-oriented approach that focuses on risk and valuation, and that seeks returns for our investors that compensate them for the risk that they are taking in the market.”
Jeff Tjornehoj, Lipper’s head of research for the Americas, says Lipper uses a complex measure it calls “consistent return” to determine its category winners.
“Our Consistent Return ratings looks at total return performance of each fund versus the peer group average total return. We evaluate over multiple subperiods within a time frame, and then we sort the results from best to worst and apply ratings,” he says. “It’s all about risk-adjusted returns. In this case, USAA’s bond funds had better risk-adjusted performance relative to their peers.”
In addition to the group award, two USAA fixed-income funds won individual awards from Lipper. The USAA Virginia Bond Fund1 beat 31 competing funds to win in the Virginia Municipal Debt category for the three-year period, and the USAA Intermediate-Term Bond Fund1 bested 116 other funds to take top prize in the Core Plus category in the five-year period.
The USAA Virginia Bond Fund is co-managed by Diederik Olijslager and John Bonnell, and the Interrnediate-Term Bond Fund is co-managed by Mr. Freund, Julianne Bass and Brian Smith.
Since the mid-1980s, USAA has won more than 70 Lipper Fund Awards. The awards, which are the leading annual honors presented to U.S. mutual funds, are presented for three-, five- and 10-year performance categories.
“As a company, USAA is much better known for insurance and banking than we are for managing investments. But we’ve been in the investment business since the 1970s, and with more than $60 billion in assets, we are among the larger asset managers in the U.S.,” Mr. Freund says. “Over the years, we’ve grown into a larger and more successful operation in San Antonio, and the credit for those results comes down to what we call the three P’s – our people, our process and our philosophy. We’re a long way from Wall Street, but we feel like with the talented and experienced team we have put together here, we can compete with the best of them.”
Consider the investment objectives, risks, charges and expenses of the USAA mutual funds carefully before investing. Contact us at 800-531-8910 for a prospectus containing this and other information about the funds from USAA Investment Management Company, Distributor. Read it carefully before investing.
Investing in securities products involves risk, including possible loss of principal.
Investing in the Bond Market is subject to certain risks including market, interest-rate, issuer, credit, and inflation risk; investments may be worth more or less than the original cost when redeemed. Municipal Securities may be sensitive to changes in interest rates, subject to early repayment risk, and their value may fluctuate in response to the market’s perception of issuer creditworthiness; while generally supported by some form of government or private guarantee there is no assurance that private guarantors will meet their obligations. High Yield, lower-rated, securities involve greater risk than higher-rated securities; portfolios that invest in them may be subject to greater levels of credit and liquidity risk than portfolios that do not. Investors will, at times, incur a tax liability. Income from Municipal Bonds may be subject to state and local taxes and at times the alternative minimum tax.
Lipper, Inc. is a subsidiary of Thomson Reuters. The Lipper Fund Awards program honors funds that have excelled in delivering consistently, strong risk-adjusted performance relative to its peers. In addition, the Lipper Fund Awards program recognizes fund families with high average scores for all funds within a particular class or overall.
Lipper’s Large Company universe is currently comprised of fund families with more than $51 billion in total net assets. Only fund families with at least five bond funds were eligible. Risk-adjusted returns are calculated with dividends reinvested and without sales charges. Past performance does not guarantee future results. The individual funds may not have ranked number one in their categories.
The ratings are subject to change every month and are based on an equal-weighted average of percentile ranks for each metric over three-, five-, and ten-year periods (if applicable). The highest 20% of funds in each peer group are named Lipper Leader, or a score of 5, the next 20% receive a score of 4, the middle 20% are scored 3, the next 20% are scored 2, and the lowest 20% are scored 1. Lipper ratings are relative, rather than absolute, measures, and funds named Lipper Leaders may still experience losses periodically; those losses may be larger for equity and mixed equity funds than for fixed income funds. Lipper ratings are not intended to predict future results, and Lipper does not guarantee the accuracy of this information. More information is available at www.lipperweb.com. Thomson Reuters Copyright 2013, All Rights Reserved.
1 The fund only received an award for the stated time period.
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