Mutual Funds
Quality Income Fund
Fund Managers
Michael Sun, CFA®
Jeffrey Ormsby, CFA®
Byron Mims, CFA®
Overview
A
Shares
SCSSX
Inception
Date
02.01.2013
Investment
Min.
$1,000
Subsequent
Investment Min.1
N/A
Max. Up Front
Sales Charge
2%
Max. Deferred
Sales Charge
N/A
1If subsequent investments are made as part of an AIP, the minimum is $25.
Philosophy & Process
In managing the Fund, the portfolio management team employs a multi-faceted approach to generate excess return and uses a combination of top-down and bottom-up analysis, quantitative vs. qualitative analysis and fundamentals vs. valuation. There is a strong emphasis on risk management and an adherence to certain core investment beliefs:
- "If you cannot measure it, you cannot manage it."
- Avoid unintended exposures
- Average duration around 2 to 5 years with focus on high quality and risk management
- Participate in longer term trends - don't buy on short-term trends or try to time what is going on in the market
- Attempts to achieve risk-adjusted performance over time
Investment Considerations
The Fund is subject to the same risks as the underlying bonds in the portfolio such as credit, prepayment, call and interest rate risk. As interest rates rise the value of bond prices will decline. The Fund may invest in more aggressive investments such as foreign securities which may expose the Fund to currency and exchange rate fluctuations; derivatives (futures and swaps); mortgage-backed securities sensitive to interest rates and high yield debt (also known as junk bonds), all of which may cause greater volatility and less liquidity. Derivatives may be more sensitive to changes in market conditions and may amplify risks.
| Term | Class A Shares | Class C Shares | Class I Shares |
|---|---|---|---|
| Ticker | SCSSX | SCSTX | SCSPX |
| Inception Date | 02.01.2013 | 02.01.2013 | 02.01.2013 |
| Investment Min. | $1,000 | $1,000 | $1,000,000 |
| Subsequent Investment Min.2 | N/A | N/A | N/A |
| Max. Up Front Sales Charge | 2% | N/A | N/A |
| Max. Deferred Sales Charge | N/A | 1% | N/A |
2If subsequent investments are made as part of an AIP, the minimum is $25.
Michael Sun, CFA®
Co-Portfolio Manager
Jeffrey Ormsby, CFA®
Co-Portfolio Manager
Byron Mims, CFA®
Co-Portfolio Manager
Performance
| Fund Performance as of 09.30.2026 | (as of 09.30.2026) | ||||||||
|---|---|---|---|---|---|---|---|---|---|
| Term | QTR | YTD | 1 Year | 3 Years | 5 Years | 10 Years | 1 Year | 5 Years | 10 Years |
| A Shares with 2.00% Sales Charge | -5.45% | -4.74% | -3.68% | 3.35% | -0.30% | 1.03% | -3.68% | -0.30% | 1.03% |
| A Shares without Sales Charge | -3.47% | -2.77% | -1.67% | 4.03% | 0.10% | 1.24% | -1.67% | 0.10% | 1.24% |
| Institutional Shares | -3.40% | -2.57% | -1.42% | 4.33% | 0.37% | 1.51% | -1.42% | 0.37% | 1.51% |
| Lipper U.S. Mortgage Median | -4.09% | -2.99% | -1.53% | 4.56% | -0.43% | 0.85% | N/A | N/A | N/A |
The net expense ratios for Class A, C and I Shares are 0.85%, 1.60% and 0.60%, respectively. The gross expense ratios for Class A, C and I Shares are 0.91%, 1.66% and 0.66%, respectively.
The Advisor has contractually agreed to limit certain fees paid by the Fund from 02.01.2026-01.31.2027. Performance would have been lower without limitations in effect.
Past performance does not guarantee future results. The performance data quoted represents past performance and current returns may be lower or higher. The investment return and principal value of an investment will fluctuate so that an investor's shares, when redeemed, may be worth more or less than the original cost.
The performance of the Sterling Capital Quality Income Fund reflects the deduction of fees for value-added services associated with a mutual fund, such as investment management and fund accounting fees. The inception date for Class A Shares is 02.01.2013. The inception date for Class C Shares is 02.01.2013. The inception date for Class Inst'l Shares is 02.01.2013. The performance shown reflects the reinvestment of all dividend and capital gains distributions. Performance is annualized for periods greater than one year.
Performance for Class A Shares and Institutional Shares for periods prior to inception on 02.01.2013 is based on performance of Class S Shares of the Fund which were re-designated as Institutional Shares as of 02.01.2013. Class A Shares and Institutional Shares of the Fund would have substantially similar performance because the Shares are invested in the same portfolio of securities and the performance would differ only to the extent that the Classes have different expenses.
Characteristics
Quality Breakdown as of 09.30.2026
Credit quality ratings using Moody's rating symbols reflect the credit quality of the underlying bonds in the fund portfolio and not of the Fund itself. Moody's assigns a range of ratings from AAA being the highest quality to C being the lowest rated class of bonds. Securities not rated by Moody's may be rated by S&P, Fitch or if no agency rating is available, the Fund will assign a rating of not rated. Bond quality ratings are subject to change.
| Name | Value |
|---|---|
| 0-2 Years | 17.11 |
| 2-4 Years | 16.94 |
| 4-6 Years | 27.41 |
| 6-8 Years | 26.06 |
| 8-10 Years | 2.92 |
| 10+ Years | 9.55 |
Current and future portfolio holdings are subject to change and risk. Based on Market Value of securities.
| Name | Value |
|---|---|
| Number of Holdings | 205 |
| Average Life | 6.61 Years |
| Effective Duration | 5.56 Years |
| Annual Turnover3 | 35% |
3Annual Turnover Ratio reflects a 12-month rolling calculation and is presented as of 09.30.2026, the most recent fiscal year end.
| Composition | Fund | Index |
|---|---|---|
| Government Related | 0.5% | 0.0% |
| Agency | 0.5% | 0.0% |
| Securitized | 89.5% | 100.0% |
| ABS | 11.7% | 0.0% |
| CLO | 7.7% | 0.0% |
| CMBS | 23.8% | 0.0% |
| CMO | 22.5% | 0.0% |
| MBS | 23.9% | 100.0% |
| Treasury | 8.4% | 0.0% |
| Treasury | 8.4% | 0.0% |
| Cash | 1.6% | 0.0% |
| Cash | 1.6% | 0.0% |
| # | Company Name | Value |
|---|---|---|
| 1 | US 10YR ULTRA FUT DEC26 | 2.66% |
| 2 | US ULTRA BOND CBT DEC26 | 1.89% |
| 3 | Government Of The United States Of America 2.375% 15-feb-2042 | 1.80% |
| 4 | LCM 33A AR CALLABLE 07/20/26 144A VRN | 1.62% |
| 5 | Bmo 2023-c7 Mortgage Trust 6.16% 15-dec-2056 | 1.53% |
| 6 | Benchmark 2023-b39 Mortgage Trust 5.754% 17-jul-2056 | 1.51% |
| 7 | Bank 2024-bnk47 5.716% 15-jun-2057 | 1.51% |
| 8 | Wells Fargo Commercial Mortgage Trust 2024-c63 5.309% 17-aug-2057 | 1.46% |
| 9 | Bbcms Mortgage Trust 2025-c39 5.297% 17-dec-2058 | 1.46% |
| 10 | FHLMC REMIC SERIES 5419 Z | 1.45% |
Current and future portfolio holdings are subject to change and risk. Based on Market Value of securities.
Growth of $10,000 as of 09.30.2026
The Growth of $10,000 is hypothetical based upon the performance of net A Shares at NAV for the period ended 09.30.2026. It includes the reinvestment of dividends and capital gains.
Distribution
| Month | Class A Shares | Class C Shares | Class Inst'l Shares |
|---|---|---|---|
| October 2026 | $0.0296 | $0.0240 | $0.0311 |
| September 2026 | $0.0292 | $0.0238 | $0.0311 |
| August 2026 | $0.0289 | $0.0232 | $0.0309 |
| July 2026 | $0.0287 | $0.0230 | $0.0307 |
| June 2026 | $0.0278 | $0.0223 | $0.0298 |
| May 2026 | $0.0279 | $0.0221 | $0.0298 |
| April 2026 | $0.0275 | $0.0219 | $0.0294 |
| March 2026 | $0.0282 | $0.0223 | $0.0301 |
| February 2026 | $0.0276 | $0.0223 | $0.0294 |
| January 2026 | $0.0277 | $0.0218 | $0.0297 |
| December 2025 | $0.0274 | $0.0215 | $0.0294 |
| November 2025 | $0.0276 | $0.0219 | $0.0295 |
| Share Class | Without Waivers | With Waivers |
|---|---|---|
| Class A | 4.09% | 4.15% |
| Class C | 3.41% | 3.47% |
| Class I | 4.43% | 4.49% |
Quality Income Fund
Materials
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