COINX — Madison Corporate Bond Fund

COINX Fund Overview

COINX — Madison Corporate Bond Fund is a US mutual fund managed by Madison Funds, categorised as Corporate Bond. ABC INVEST provides holdings, performance, costs, cashflows, risk data, prospectus documents and SEC filings, sourced from SEC filings.

• Type: US mutual fund
• Manager: Madison Funds
• Category: Corporate Bond
• Assets under management: $13.92M
• Ticker: COINX
• SEC CIK: 0001040612
• SEC series ID: S000040130
• Share class ID: C000124793

COINX Investment Objective and Strategy

Madison Corporate Bond Fund describes its objective and strategy as follows, from its latest prospectus filed with the SEC by Madison Funds.

Investment objective

The Madison Corporate Bond Fund seeks to obtain high total investment returns in the form of income and share price appreciation.

Principal investment strategy

The fund seeks to achieve its investment objective through diversified investment in a broad range of corporate debt securities. In seeking to achieve the funds goal, the funds investment adviser will: (1) monitor the yields of the various bonds that satisfy the funds investment guidelines to determine the best combination of yield, credit risk and diversification for the fund; (2) shorten or lengthen the funds weighted average life and dollar weighted average duration based on the advisers anticipation of the movement of interest rates; (3) select individual securities based on a thorough evaluation of fundamental credit risk; and (4) actively rotate among sectors and quality ratings in search of value and to manage risk. Duration is an approximation of the expected change in a debt securitys price given a 1% move in interest rates, using the following formula: [change in debt security value = (change in interest rates) x (duration) x (-1)].

By way of example, assume XYZ company issues a five year bond which has a duration of 4.5 years. If interest rates were to instantly increase by 1%, the bond would be expected to decrease in value by approximately 4.5%. Under normal market conditions, the fund will invest at least 80% of its net assets in income-producing corporate bonds, and at least 80% of its assets in investment grade bonds. Up to 20% of the funds assets may be invested in non-investment grade fixed-income securities commonly referred to as high yield or junk bonds. The securities will primarily be issued by domestic corporations, but could include foreign (including emerging market) corporations. The fund expects to maintain an average overall portfolio quality of BBB or better, an overall portfolio weighted average life of 15 years or less, and an overall portfolio duration within 25% of the Bloomberg Barclays U.S.

Corporate Bond Index benchmark (the Bloomberg Barclays Index) (with the flexibility to occasionally vary from the benchmark by up to 50% when the investment adviser believes interest rates are likely to materially change). As of December 31, 2017, the weighted average life of the fund was 8.82 years and 10.92 years for the Bloomberg Barclays Index. As of that same date, the duration of the fund was 6.48 years and the duration of the Bloomberg Barclays Index was 7.39 years. The fund generally holds 100-150 individual securities in its portfolio at any given time. The funds investment adviser, Madison Asset Management, LLC (Madison), may alter the composition of the fund with regard to quality and maturity and may sell securities prior to maturity. Under normal circumstances, however, turnover for the fund is generally not expected to exceed 100%.

Sales of fund securities may result in capital gains. This can occur any time Madison sells a bond at a price that was higher than the purchase price, even if Madison does not engage in active or frequent trading. Madisons intent when it sells bonds is to lock in any gains already achieved by that investment or, alternatively, prevent additional or potential losses that could occur if Madison continued to hold the bond. Turnover may also occur when Madison finds an investment that could generate a higher return than the investment currently held. However, increasing portfolio turnover at a time when Madisons assessment of market performance is incorrect could lower investment performance. The fund pays implied brokerage commissions when it purchases or sells bonds, which is the difference between the bid and ask price.

As a result, as portfolio turnover increases, the cumulative effect of this may hurt fund performance. Under normal circumstances, the fund will not engage in active or frequent trading of its bonds. However, it is possible that Madison will determine that market conditions require a significant change to the composition of the funds portfolio. For example, if interest rates begin to rise, Madison may attempt to sell bonds in anticipation of further rate increases before they lose more value. Also, if the fund experiences large swings in shareholder purchases and redemptions, Madison may be required to sell bonds more frequently in order to generate the cash needed to pay redeeming shareholders. Under these circumstances, the fund could make a taxable capital gain distribution. Madison reserves the right to invest a portion of the funds assets in short-term debt securities (i.e., those with maturities of one year or less) and to maintain a portion of fund assets in uninvested cash.

However, Madison does not intend to hold more than 20% of the funds assets in such investments, unless Madison determines that market conditions warrant a temporary defensive investment position. Under such circumstances, up to 100% of the fund may be so invested. To the extent the fund engages in this temporary defensive position, the funds ability to achieve its investment objective may be diminished. Short-term investments may include investment grade certificates of deposit, commercial paper and repurchase agreements. Madison might hold substantial cash reserves in seeking to reduce the funds exposure to bond price depreciation during a period of rising interest rates and to maintain desired liquidity while awaiting more attractive investment conditions in the bond market.

COINX Costs and Fees

COINX costs about $65 per $10,000 invested per year in fund expenses.

• Net expense ratio: 0.65%
• Gross expense ratio: 0.65%
• Portfolio turnover: 20%
• Brokerage commissions: 0.00 bps of average net assets (SEC N-CEN)

COINX Cashflows

Over the 12 months to 2020-04, Madison Corporate Bond Fund had net outflows of $1.21M, from monthly SEC N-PORT filings.

COINX Debt Constituents

No individual debt constituents are reported in Madison Corporate Bond Fund's latest SEC N-PORT filing.

COINX Prospectus and SEC Filings

Official Madison Corporate Bond Fund filings on SEC EDGAR — prospectus, portfolio holdings and annual reports.

• Prospectus (485BPOS) — filed 2020-06-15
• Prospectus (485BPOS) — filed 2019-03-11
• Prospectus (485BPOS) — filed 2018-03-13
• Portfolio holdings (N-PORT) — filed 2020-06-11
• Portfolio holdings (N-PORT) — filed 2020-03-25
• Portfolio holdings (N-PORT) — filed 2019-12-11
• Annual census (N-CEN) — filed 2020-01-07
• Annual census (N-CEN) — filed 2019-01-14

Related Funds

Other Corporate Bond funds tracked on ABC INVEST:

• First Trust Preferred Securities and Income ETF (FPE)
• Nuveen Preferred Securities and Income Fund (NPSAX)
• Spectrum Preferred and Capital Securities Income Fund (PNARX)
• Invesco Variable Rate Preferred ETF (VRP)
• First Trust Institutional Preferred Securities and Income ETF (FPEI)

Data Sources

ABC INVEST compiles this page from public filings made to the U.S. Securities and Exchange Commission (SEC) through EDGAR: portfolio holdings and monthly cashflows from Form N-PORT, expenses and returns from fund prospectuses (Form 485BPOS) and the SEC DERA Risk/Return Summary data sets, annual data from Form N-CEN, and shareholder reports from Form N-CSR.