High Yield Fund

High Yield Fund

Quick Facts
InvestorInstitutional
Ticker:BUFHXBUIHX
Inception Date:5/19/19957/1/2019
Expense Ratio:1.03%0.89%
Total Net Assets:$275.73 Million  (3/31/21)
Category:High Yield Bond
Benchmark:ICE BofAML U.S. High Yield
Dividend Distribution:Monthly
Related Material:
   Fund Fact Sheet Q1 2021
   PM Commentary Q1 2021
   Summary Prospectus
Fund Objective & Investment Process

The investment objective of the Buffalo High Yield Fund is primarily current income, with long-term growth of capital as a secondary objective. The High Yield Fund normally invests at least 80% of its net assets in higher-yielding, higher-risk debt securities rated below investment grade by the major rating agencies (or in similar unrated securities), commonly known as “junk bonds”. Debt securities can include fixed and floating rate bonds as well as bank debt and convertible debt securities.

While the Fund maintains flexibility to invest in bonds of varying maturities, the Fund generally holds bonds with intermediate-term maturities. With respect to the remaining 20% of the Fund’s net assets, the Fund may invest in investment grade debt securities, U.S. Treasury Securities (typically with maturities of 60 days or less), money market funds, and equity investments, including dividend paying stocks and convertible preferred stocks.
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Our team brings many years of credit research experience to the bond market. We are proud to have provided our shareholders with what we believe is a conservative approach to investing in high yield bonds since 1995.

Jeff Sitzmann, Portfolio Manager

Morningstar Rating

       

Overall Morningstar Rating™ of BUFHX based on risk-adjusted returns among 633 High Yield Bond funds as of 5/31/21.

Performance (%)

As of 5/31/213 MOYTD1 YR3 YR5 YR10 YR15 YR20 YRSince Inception
(5/19/95)
BUFFALO HIGH YIELD FUND - Investor1.693.2419.067.586.385.706.406.497.10
BUFFALO HIGH YIELD FUND - Institutional1.643.3119.127.716.525.856.556.657.25
  ICE BofAML U.S. High Yield Index1.562.3115.186.797.246.257.277.417.16
  Lipper High Yield Bond Funds Index1.832.9215.936.286.795.646.156.295.97
  Morningstar High Yield Bond Category1.732.5214.565.816.115.256.076.355.91
As of 3/31/213 MOYTD1 YR3 YR5 YR10 YR15 YR20 YRSince Inception
(5/19/95)
BUFFALO HIGH YIELD FUND - Investor1.731.7327.077.066.545.686.216.537.08
BUFFALO HIGH YIELD FUND - Institutional1.771.7727.287.196.685.836.366.697.24
  ICE BofAML U.S. High Yield Index0.900.9023.316.537.946.317.217.357.15
  Lipper High Yield Bond Funds Index1.471.4724.075.957.305.686.076.205.95
  Morningstar High Yield Bond Category1.101.1021.795.436.545.316.006.305.89
For performance prior to 7/1/19 (Inception Date of Institutional Class), performance of the Investor Class shares is used and includes expenses not applicable and lower than those of Investor Class shares.Performance data quoted represents past performance; past performance does not guarantee future results. 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 their original cost. Current performance of the fund may be lower of higher than the performance quoted and can be obtained here. Performance is annualized for periods greater than 1 year. Each Morningstar category average represents a universe of funds with similar objectives.
3 Year Risk Metrics
BUFHX vs ICE BofAML U.S. High Yield Index (As of 3/31/21)
Upside Capture95.96
Downside Capture87.81
Alpha0.98
Beta0.92
Sharpe Ratio0.63
Hypothetical Growth of $10,000
This chart illustrates the performance of a hypothetical $10,000 investment made in the Fund on the Inception Date. Assumes reinvestment of dividends and capital gains. This chart does not imply future performance.
Distributions
2021 Distribution Dates:

— Record Date (6/17/21); Payment Date (6/18/21) – Ordinary Income & Capital Gains, if any

— Record Date (7/19/21); Payment Date (7/20/21) – Ordinary Income & Capital Gains, if any

— Record Date (8/17/21); Payment Date (8/18/21) – Ordinary Income & Capital Gains, if any

— Record Date (9/17/21); Payment Date (9/20/21) – Ordinary Income & Capital Gains, if any

— Record Date (10/18/21); Payment Date (10/19/21) – Ordinary Income & Capital Gains, if any

— Record Date (11/17/21); Payment Date (11/18/21) – Ordinary Income & Capital Gains, if any

— Record Date (12/2/21); Payment Date (12/3/21) – Capital Gains, if any

— Record Date (12/17/21); Payment Date (12/20/21) – Ordinary Income, if any
Record
Date
Payable
Date
Distribution
NAV
Net Investment
Income
Short-Term Capital
Gains
Long-Term Capital
Gains
Distribution
Total
5/17/215/18/21$11.88 (Inv)

$11.87 (Inst)
$0.02955878

$0.03092565
-

-
-

-
$0.02955878

$0.03092565
4/19/214/20/21$11.89 (Inv)

$11.88 (Inst)
$0.02511590

$0.02671660
-

-
-

-
$0.02511590

$0.02671660
3/17/213/18/21$11.78 (Inv)

$11.77 (Inst)
$0.04416967

$0.04553159
-

-
-

-
$0.04416967

$0.04553159
2/17/212/18/21$11.89 (Inv)

$11.88 (Inst)
$0.03905063

$0.04046545
-

-
-

-
$0.03905063

$0.04046545
1/19/211/20/21$11.83 (Inv)

$11.82 (Inst)
$0.02991434

$0.03150591
-

-
-

-
$0.02991434

$0.03150591
For historical distributions, click here.

Portfolio

Portfolio Characteristics
(As of 3/31/21) 
 
# of Holdings138
3-Yr Annualized Turnover Ratio33.06%
Average Duration2.72 years
Average Maturity7.19 years
30-day SEC Yield3.04%
Top 10 Holdings
Name of Holding% of Net
Assets
Open Lending (1 mo LIBOR + 6.500%, 3/11/27)2.58%
Nuance Communications (1.500%, 11/1/35)2.46%
MPLX (6.875%, 8/15/23)2.17%
Daseke (1 mo LIBOR + 5.000%, 2/27/24)1.86%
Builders FirstSource (5.000%, 3/1/30)1.62%
Michaels Stores (8.000%, 7/15/27)1.61%
CNX Resources (7.250%, 3/14/27)1.61%
Treehouse Foods (4.000%, 9/1/28)1.55%
Diebold Nixdorf (8.500%, 4/15/24)1.52%
Comstock Resources (9.750%, 8/15/26)1.41%
TOP 10 HOLDINGS TOTAL18.39%
As of 12/31/20. Top 10 Holdings for the quarter are not disclosed until 60 days after quarter end. Fund holdings are subject to change and are not recommendations to buy or sell any securities.
Asset Allocation
Percentages of Total Assets as of 3/31/21. Allocation percentages may not equal 100% due to rounding.
Sector Weighting
As of 3/31/21. Security weightings are subject to change and are not recommendations to buy or sell any securities. Sector Allocation may not equal 100% due to rounding.
Duration
Duration Breakout (%)*
10+ Years0.02
7-10 Years1.47
5-7 Years9.51
3-5 Years23.34
1-3 Years28.18
0-1 Years21.01
*Excludes Bank Loans and Converts.
Credit Quality
Quality Breakout (%)
Baa4.27
Ba9.34
B50.15
Caa11.89
Unassigned24.35
All ratings are as of 3/31/21. Moody’s is the rating source for the Quality Breakout Table. A credit rating is an assessment provided by a nationally recognized statistical rating organization (NRSRO), such as Moody’s or Standard & Poor’s. The firm evaluates the of credit worthiness of an issuer with respect to debt obligations, including specific securities, money market instruments, or other bonds. Ratings are measured on a scale that generally ranges from Aaa (highest grade) to C (lowest grade); ratings are subject to change without notice. Unassigned rating indicates that the debtor was not rated by an NRSRO and should not be interpreted as indicating low quality.

Management

Paul Dlugosch, CFA
Portfolio Manager

24 Years of Experience

 View full bio

Jeff Sitzmann, CFA
Portfolio Manager

34 Years of Experience

 View full bio

Jeff Deardorff, CFA
Portfolio Manager

24 Years of Experience

 View full bio

Commentary

CAPITAL MARKET OVERVIEW

(As of 3/31/21) — The U.S. high yield sector continued its rally in the quarter, keeping yields at record lows. High yield bond prices continued their recovery from the COVID-19 sell-off in March 2020 amid stimulus and vaccine optimism. The high yield market, as demonstrated by the JP Morgan Domestic High Yield Index, posted positive returns in each month of the quarter (0.56% in January, 0.44 % in February, and 0.39% in March) maintaining yields at a 4.72% level. The 10-year U.S. Treasury Bond declined -7.08% during the quarter while the S&P 500 Index logged a return of 6.17%.

Following $3.4 billion in cash outflows in the final quarter of 2020, high yield mutual funds recorded another $10.2 billion in outflows this quarter. Interestingly, between the months of April to August 2020, high yield funds posted five consecutive months of inflows totaling $59.1 billion, which included the two largest monthly inflows ever recorded in April ($17.1 billion) and May ($20.5 billion), only to be followed by seven consecutive months of outflows totaling -$9.2 billion.

High yield new issuance volume was a record $158.6 billion during the three-month period after posting $99 billion in the previous quarter. Refinancing continued to be the primary use of proceeds accounting for ~77% of transaction volume in the quarter. According to JP Morgan, mid-tier and upper tier (B-split BBB) issues accounted for the bulk of activity in the quarter (86%) with the heaviest volume coming from Energy (20.3%), Gaming/Lodging (9.8%), and Telecommunications (6.8%).

The yield on the 10-year Treasury Bond increased 82 basis points (bps) during the quarter, from 0.92% to 1.74%, as early signs of inflation and a “return to normal” post-COVID outlook crept into the market. According to data from JP Morgan, the higher credit rating silos, which are more sensitive to interest rate movements, posted negative returns in the quarter while the lower tier silos performed better, as investors sought higher yields. The Defaulted segment produced the largest gain of 21.86% and the BB segment was the worst performer with a 0.09% loss.

According to data from JP Morgan, the U.S. high yield market’s spread to worst for the period was 406 bps, 38 bps tighter than the preceding December quarter and 194 bps tighter than its 20-year historical average of 600 bps. The yield to worst for the high yield market at quarter end was 4.72%, below the 20-year average of 8.34%, and essentially unchanged from the 4.71% at the end of the 4th quarter of 2020.

PERFORMANCE COMMENTARY

(As of 3/31/21) — The Buffalo High Yield Fund (BUFHX) increased 1.73% in the quarter, outperforming the ICE BofAML U.S. High Yield Index return of 0.90% for the three-month period. The Fund also outperformed the Lipper High Yield Bond Funds Index return of 1.47%.

Fund Composition by Asset Class
3/31/206/30/209/30/2012/31/203/31/21
Straight Corporates60.1%55.4%60.6%61.0%62.7%
Convertibles16.7%20.1%17.6%14.7%16.3%
Bank Loans19.1%16.6%16.3%17.2%11.2%
Preferred Stock1.3%1.7%1.5%1.2%2.2%
Convertible Preferred0.0%0.0%0.0%0.0%0.0%
Common Stocks1.0%0.6%0.4%0.1%0.0%
Cash1.8%5.6%3.6%5.8%7.6%
Total100.0%100.0%100.0%100.0%100.0%
Approximate Rate and Contribution of Return from the Fund’s Various Asset Classes in 1Q21
Contribution to Return
Straight Corporates1.31%
Convertibles0.19%
Bank Loans0.29%
Preferred Stocks0.14%
Convertible Preferred0.00%
Common Stocks0.00%
Total1.73%

TOP CONTRIBUTORS

During the period 112 out of the 143 issues in the Buffalo High Yield Fund produced positive returns. The three top contributors were Southwest Airlines 1.25% convertible bonds, J2 Global 1.75% convertible bonds, and Quad Graphics 7.00% corporate bonds. The rise in Southwest Airlines convertible bonds was driven by the underlying common stock rallying throughout the quarter as COVID-19 vaccinations began rolling out and interest in air travel picked up steam. J2 Global improved on the back of the underlying common stock increasing over 22% during the quarter, driven by better than expected earnings and continued demand for its cloud-based communication services. Quad Graphics corporate bonds returned to near par levels, after the company reported better than expected earnings during the quarter, and investors were attracted to its higher coupon, lower duration profile.

TOP DETRACTORS

Guidewire 1.25% convertible bonds, Smile Direct Club zero coupon convertible bonds, and the Air Transport Services 1.125% convertible bonds were the worst performers during the quarter. Guidewire performed well in the December quarter and gave some of that back this period as investors rolled out of Technology and into value sectors. Smile Direct Club convertible bonds were issued during the quarter as the stock was peaking and then retreated after the issuance. Air Transport Services convertible bonds declined after the common stock peaked at year-end despite Amazon announcing that it was purchasing another eleven aircraft from the company.

OUTLOOK

(As of 3/31/21) — We are managing the Fund cautiously yet actively, focusing on high quality, below investment grade issuers with defensive business models and manageable credit metrics. We will continue to deploy cash in opportunities that we believe offer the most appealing risk/reward tradeoff with a bias toward shorter durations and less levered credits. Additionally, we believe bank loans offer a more defensive position as they provide senior positioning in the capital structure and less interest rate sensitivity due to their floating rate structures. Finally, we continue to look for opportunities in convertible bonds and preferred stocks. We ended the period with 143 positions, up slightly from the previous quarter’s level of 138 (excluding cash).

The opinions expressed are those of the Portfolio Manager(s) and are subject to change, are not guaranteed and should not be considered recommendations to buy or sell any security. Earnings growth is not representative of the fund’s future performance.

Literature

General Account
Forms
Investor
Class
Institutional
Class
Both
  New Account Application
  New Account Application - Entity
  Change or Add Account Details
  Cost Basis Method Election
  Power of Attorney
Individual Retirement Account (IRA) Forms
  IRA Account Application
  IRA Beneficiary Addition / Change
  IRA Required Minimum Distribution (RMD)
  IRA / Qualified Plan Distribution Request
  IRA Transfer
Coverdell Education Savings Accounts (ESA) Forms
  Coverdell ESA Application
  Coverdell ESA Distribution Request
  Coverdell ESA Transfer
Retirement Information
  Retirement Savings Options for Individuals

Fundamental Approach

We get to know the companies we invest in and learn how they run their business.

Top-Down & Bottom-Up

We identify Top-Down broad, secular growth trends and search for companies from the Bottom-Up.

Proprietary Philosophy

We construct our portfolios based on our own proprietary investment strategy.

Disciplined Investing

Sticking to our disciplined investment strategy ensures we maintain a consistent, balanced approach.

The Morningstar Rating™ for funds, or "star rating", is calculated for managed products (including mutual funds, variable annuity and variable life subaccounts, exchange-traded funds, closed-end funds, and separate accounts) with at least a three-year history. Exchange-traded funds and open-ended mutual funds are considered a single population for comparative purposes. It is calculated based on a Morningstar Risk-Adjusted Return measure that accounts for variation in a managed product's monthly excess performance, placing more emphasis on downward variations and rewarding consistent performance. The top 10% of products in each product category receive 5 stars, the next 22.5% receive 4 stars, the next 35% receive 3 stars, the next 22.5% receive 2 stars, and the bottom 10% receive 1 star. The Overall Morningstar Rating™ for a managed product is derived from a weighted average of the performance figures associated with its three-, five-, and 10-year (if applicable) Morningstar Rating™ metrics. The weights are: 100% three-year rating for 36-59 months of total returns, 60% five-year rating/40% three-year rating for 60-119 months of total returns, and 50% 10-year rating/30% five-year rating/20% three-year rating for 120 or more months of total returns. While the 10-year overall star rating formula seems to give the most weight to the 10-year period, the most recent three-year period actually has the greatest impact because it is included in all three rating periods.

The Buffalo High Yield Fund (BUFHX) received 5 stars among 633 for the 3-year, 3 stars among 556 for the 5-year, and 4 stars among 361 High Yield Bond funds for the 10-year period ending 5/31/21.

In each Morningstar Category, the 10% of funds with the lowest measured risk are described as Low Risk, the next 22.5% Below Average, the middle 35% Average, the next 22.5% Above Average, and the top 10% High. Morningstar Risk is measured for up to three time periods (three, five, and 10 years). These separate measures are then weighted and averaged to produce an overall measure for the fund. Funds with less than three years of performance history are not rated. ©2021 Morningstar, Inc. All Rights Reserved. The information contained herein: (1) is proprietary to Morningstar; (2) may not be copied or distributed; and (3) is not warranted to be accurate, complete or timely. Neither Morningstar nor its content providers are responsible for any damages or losses arising from any use of this information. Past performance is no guarantee of future results. The Morningstar Style Box™ reveals a fund’s investment strategy by showing its investment style and market capitalization based on the fund’s portfolio holdings.

Bond ratings are grades given to bonds that indicates their credit quality as determined by a private independent rating service such as [Standard & Poor’s or Moody’s, etc.]. The firm evaluates a bond issuer’s financial strength, or its ability to pay a bond’s principal and interest in a timely fashion. Ratings are expressed as letters ranging from ‘AAA’, which is the highest grade, to ‘D’, which is the lowest grade. Not Rated category includes holdings that are not rated by any rating agencies.
7 Buffalo Funds Named to IBD Best Mutual Funds 2021 List

7 Buffalo Funds Named to IBD Best Mutual Funds 2021 List

Media Coverage

7 Buffalo Funds Named to IBD Best Mutual Funds 2021 List

Overview

The Buffalo Funds recently had seven funds selected for the Investor’s Business Daily 2021 Best Mutual Funds Award Winner list, in the 6th annual ranking by the investment publication.

Best U.S. Diversified

  • Buffalo Early Stage Growth Fund
  • Buffalo Small Cap Fund
  • Buffalo Discovery Fund
  • Buffalo Large Cap Fund
  • Buffalo Growth Fund

Best Large Cap

  • Buffalo Large Cap Fund
  • Buffalo Growth Fund

Best Mid Cap

  • Buffalo Discovery Fund

Best Small Cap

  • Buffalo Early Stage Growth Fund
  • Buffalo Small Cap Fund

Best International

  • Buffalo International Fund

Best U.S. Taxable Bond

  • Buffalo High Yield Fund

Funds named to IBD’s list were chosen because they have outperformed their benchmark index over the past 1, 3, 5, and 10-year periods, as of 12/31/20. In order to make the list, funds must have outperformed in all four time periods. IBD made its selections from 3,368 mutual funds that met the criteria of having at least 10 years of operation.

We’re honored that our funds have been recognized in this way by IBD. These funds exemplify our firm’s goal of consistently delivering strong risk-adjusted performance to our shareholders, said Kent Gasaway, president of the Buffalo Funds.

To view IBD’s complete list and analysis of the Best Mutual Funds 2021, please visit: https://www.investors.com/etfs-and-funds/mutual-funds/best-mutual-funds-beating-sp-500-over-last-1-3-5-10-years/

Performance data quoted represents past performance; past performance does not guarantee future results. 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 their original value. Current performance may be lower or higher than the performance quoted. Performance data current to the most recent month-end may be obtained here. Performance data current to the most recent quarter-end may be obtained here. Performance is annualized for periods greater than 1 year.

Opinions expressed are those of the author or Funds and are subject to change, are not intended to be a forecast of future events, a guarantee of future results, nor investment advice.

References to other mutual funds should not to be considered an offer to buy or sell these securities.

HIGHLIGHT

Seven Buffalo Funds were named to Investor’s Business Daily Best Mutual Funds 2021 list, including the Best U.S. Diversified, Growth, Large Cap, Mid Cap, Small Cap, International, and U.S. Taxable Bond Fund categories.

MEDIA CONTACT

Joel Crampton
Director of Marketing
(913) 647-9881
Email

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Stay up-to-date with the most recent media coverage and press releases about the Buffalo Funds.

FOR FINANCIAL PROFESSIONALS

Terms of Use – Email lists are created for use by U.S. investment professionals only and are published strictly for informational purposes. Providing access to the content of these emails does not explicitly or implicitly constitute a solicitation of services or products of the Buffalo Funds, Kornitzer Capital Management, or any of their affiliates. The information contained in the emails is not intended for distribution to, or for use by, investment professionals in a jurisdiction where distribution or purchase is not authorized. The information contained in these emails is not appropriate for use by individual investors. By registering for any of these emails, you agree to Buffalo's terms and conditions and that you are qualified as an institutional investor or otherwise member of a registered broker/dealer, registered investment advisor, or investment consulting firm.

FOR INDIVIDUAL INVESTORS

7 Buffalo Funds Named to IBD Best Mutual Funds 2021 List

Buffalo Funds named to IBD Best Mutual Funds 2020

Media Coverage

Buffalo Funds named to IBD Best Mutual Funds 2020

Overview

The Buffalo International Fund (BUFIX) and the Buffalo High Yield Fund (BUFHX) are included on the Investor’s Business Daily 2020 Best Mutual Funds Award Winner list, in the 5th annual ranking by the investment publication, announced this week.

The International Fund was included in the Best International Stock Funds, and the High Yield Fund was included in the Best U.S. Taxable Bond Funds.

Funds named to IBD’s list were chosen because they have outperformed their benchmark index over the past 1, 3, 5, and 10-year periods, as of 12/31/19. In order to make the list, funds must have outperformed in all four time periods. IBD made its selections from 3,374 mutual funds that met the criteria of having at least 10 years of operation.

We’re honored that our funds have been recognized in this way by IBD. These funds exemplify our firm’s goal of consistently delivering strong risk-adjusted performance to our shareholders, said Clay Brethour, president of the Buffalo Funds.

The Buffalo International Fund is managed by Bill Kornitzer and Nicole Kornitzer, a team that has been in place since 2009.

The Buffalo High Yield Fund is managed by Paul Dlugosch, Jeff Sitzmann, and Jeff Deardorff.

To view IBD’s complete list and analysis of the Best Mutual Funds 2020, please visit: https://www.investors.com/etfs-and-funds/mutual-funds/best-mutual-funds-beating-sp-500-over-last-1-3-5-10-years/

Performance data quoted represents past performance; past performance does not guarantee future results. 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 their original value. Current performance may be lower or higher than the performance quoted. Performance data current to the most recent month-end may be obtained here. Performance data current to the most recent quarter-end may be obtained here. Performance is annualized for periods greater than 1 year.

Opinions expressed are those of the author or Funds and are subject to change, are not intended to be a forecast of future events, a guarantee of future results, nor investment advice.

References to other mutual funds should not to be considered an offer to buy or sell these securities.

HIGHLIGHT

BUFIX and BUFHX named to Investor’s Business Daily Best Mutual Funds 2020 list in the International Stock Fund and U.S. Taxable Bond Funds categories, respectively.

MEDIA CONTACT

Joel Crampton
Director of Marketing
(913) 647-9881
Email

Sign Up for Automatic Updates

Stay up-to-date with the most recent media coverage and press releases about the Buffalo Funds.

FOR FINANCIAL PROFESSIONALS

Terms of Use – Email lists are created for use by U.S. investment professionals only and are published strictly for informational purposes. Providing access to the content of these emails does not explicitly or implicitly constitute a solicitation of services or products of the Buffalo Funds, Kornitzer Capital Management, or any of their affiliates. The information contained in the emails is not intended for distribution to, or for use by, investment professionals in a jurisdiction where distribution or purchase is not authorized. The information contained in these emails is not appropriate for use by individual investors. By registering for any of these emails, you agree to Buffalo's terms and conditions and that you are qualified as an institutional investor or otherwise member of a registered broker/dealer, registered investment advisor, or investment consulting firm.

FOR INDIVIDUAL INVESTORS

“Outlook on High Yield Markets”

“Outlook on High Yield Markets”

“Outlook on High Yield Markets”

Insights from the defensively-minded, high yield fixed income team of Buffalo High Yield Fund portfolio managers

The high yield market (as measured by the BofA Merrill Lynch HY Master II Index) has rallied significantly since February 2016 and notched 20 consecutive months without posting a loss of 50 basis points (bps) or more, something that hasn’t occurred in over 20 years. In this latest report, the portfolio managers of the Buffalo High Yield Fund identify several factors that have driven spread compression and high yield performance in the market.

Areas covered in this report include:

  • Our view on today’s high yield markets
  • Current market drivers
  • Areas of concern
  • Action items for investors
  • The appeal of bank loans
  • The risks of high yield index benchmarks
  • Our distinctive investment approach to high yield markets

As a defensively-minded, high yield fixed income team, the Buffalo High Yield Fund portfolio managers follow a more cautious investment philosophy, with the goal of producing compelling risk-adjusted performance over a full market cycle.

Past performance is not a guarantee of future results. Index performance is not illustrative of fund performance. It is not possible to invest directly in an index. Please click here for fund performance.

Fundamental Approach

We get to know the companies we invest in and learn how they run their business.

Top-Down & Bottom-Up

We identify Top-Down broad, secular growth trends and search for companies from the Bottom-Up.

Proprietary Philosophy

We construct our portfolios based on our own proprietary investment strategy.

Disciplined Investing

Sticking to our disciplined investment strategy ensures we maintain a consistent, balanced approach.

U.S. News “Best Mutual Funds in 2016” List Includes Several Buffalo Funds

U.S. News “Best Mutual Funds in 2016” List Includes Several Buffalo Funds

Media Coverage

U.S. News “Best Mutual Funds in 2016” List Includes Several Buffalo Funds

Overview

As of August 31, 2016, U.S. News showed the Buffalo International Fund was ranked #4 of 385 Foreign Large Growth funds, the Buffalo Discovery Fund was ranked #7 of 630 Mid-Cap Growth funds, and the Buffalo Flexible Income Fund was ranked #15 of 380 Allocation–70% to 85% Equity funds. Other Buffalo Funds that ranked within the top 100 in their category include the Buffalo High Yield Fund (#41 of 712 High Yield Bond funds) and the Buffalo Large Cap Fund (#47 of 1,436 Large Growth funds).

For more information and current rankings, visit the U.S. News website here.

The U.S. News Best Mutual Fund Score is determined by the overall equal weightings of ratings from five data sources: Morningstar, Lipper, Zacks, TheStreet.com, and Standard & Poor’s as of 8/31/2016. To learn more about their scoring methodology, click here.

HIGHLIGHT

International Fund #4
Discovery Fund #7
Flexible Income Fund #15

MEDIA CONTACT

Joel Crampton
Director of Marketing
(913) 647-9881
Email


Click here for current ratings of the Buffalo Funds.

The Overall Morningstar Rating™ for a managed product is derived from a weighted average of the performance figures associated with its three-, five-, and 10-year (if applicable) Morningstar Rating™ metrics.

While the U.S. News Mutual Fund Score combines all five equally weighted category scores to achieve its weighting, Lipper intends its measures to be used as individual assessments of a fund’s ability to meet specific goals, rather than as a cumulative measure of fund quality. Lipper rankings are comprised of five unique measures (Total Return, Consistent Return, Preservation, Expense, and Tax Efficiency), each with a 1-to-5 score, ranking each fund against its peers. The highest 20% of funds in each peer group are named Lipper Leaders, the next 20% receive a rating of 4, the middle 20% are rated 3, the next 20% are rated 2, and the lowest 20% are rated 1. The overall calculation is based on an equal-weighted average of percentile ranks for each measure over three-, five-, and ten-year periods (if applicable). Lipper Ratings for Total Return reflect funds’ historical total return performance relative to peers. Lipper Ratings for Consistent Return reflect funds’ historical risk-adjusted returns, relative to peers. Lipper Ratings for Preservation reflect funds’ historical loss avoidance relative to other funds within the same asset class. Lipper Ratings for Tax Efficiency reflect funds’ historical success in postponing taxable distributions relative to peers. Lipper Ratings for Expense reflect funds’ expense minimization relative to peers with similar load structures.

The Zacks Mutual Fund Rank ranks funds on a scale from 1 to 5, with 1 being a Strong Buy and 5 being a Strong Sell. Each quarter, Zacks updates their Mutual Fund Rank by evaluating the average Zacks Rank for the stocks owned by the fund and blending this with other criteria their studies show is beneficial in finding funds that will outperform in the future. In general, the higher the average Zacks Rank for the stocks in the fund, then the higher the Zacks Mutual Fund Rank.

TheStreet.com Ratings Investment Ratings for Funds condense the available fund performance and risk data into a single composite opinion of each fund’s risk-adjusted performance. “A (Buy) Excellent” rating means the fund has an excellent track record of maximizing performance while minimizing risk, thus delivering the best possible combination of total return on investment and reduced volatility. “B (Buy) Good” rating means the fund has a good track record of balancing performance with risk. “C (Hold) Fair” rating ratings means the fund has a track record which is about average. “D (Sell) Weak” rating means the fund has underperformed the universe of other funds given the level of risk in its underlying investments, resulting in a weak risk-adjusted performance. “E (Sell) Very Weak” rating means the fund has significantly underperformed most other funds given the level of risk in its underlying investments, resulting in a very weak risk-adjusted performance. The plus sign (+) is an indication that the fund is in the top third of its letter grade. The minus sign (-) is an indication that the fund is in the bottom third of its letter grade. “U Unrated” rating means the fund does not have sufficient history to make a reliable assessment of its risk-adjusted performance.

The CFRA Rankings range from five-star (highest) to one-star (lowest) and follow a normalized distribution curve, based upon the fund’s rank in its Category. Top 10% receive five stars, next 20% receive four stars, middle 40% receive three stars, next 20% receive two stars, and the bottom 10% receive one star. Rankings are refreshed on a weekly basis to incorporate the latest inputs from the holdings-based analysis and the latest relative performance review.

Performance data quoted represents past performance; past performance does not guarantee future results. 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 their original value. Current performance may be lower or higher than the performance quoted. Performance data current to the most recent month-end may be obtained here. Performance data current to the most recent quarter-end may be obtained here.

Opinions expressed are those of the author or Funds and are subject to change, are not intended to be a forecast of future events, a guarantee of future results, nor investment advice.

References to other mutual funds should not to be considered an offer to buy or sell these securities.

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Income Investing Strategies to Preserve Principal

Income Investing Strategies to Preserve Principal

Media Coverage

Income Investing Strategies to Preserve Principal

Overview

The Buffalo High Yield Fund (BUFHX) was included in an article on Seeking Alpha, which analyzed income funds that preserved principal from 2006-2016, making note of the special year-end dividend the Fund pays annually.

“Retirement income investors should always consider whether an investment has proven that it can preserve their precious capital during periods of economic disruption. Achieving that goal requires a solid business strategy executed by competent investment managers. Investors can use price charts that span good times and bad to identify funds that have preserved investment capital.” ~ Thomas Cook, article author

To access the article click here.

Dividend payments are not guaranteed. The chart included in the article illustrates the performance of a hypothetical $1,000 investment made in the Fund on 1/1/2005. It assumes reinvestment of dividends and capital gains. The chart does not imply future performance.

Performance data quoted represents past performance; past performance does not guarantee future results. 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 their original value. Current performance may be lower or higher than the performance quoted. Performance data current to the most recent month-end may be obtained here. Performance data current to the most recent quarter-end may be obtained here.

Opinions expressed are those of the author or Funds and are subject to change, are not intended to be a forecast of future events, a guarantee of future results, nor investment advice.

References to other mutual funds should not to be considered an offer to buy or sell these securities.

Definitions can be viewed by clicking here.

HIGHLIGHT

Using techniques identified in the article, a few income funds are highlighted (including the Buffalo High Yield Fund) that pay regular dividends and preserved investors’ capital during the period before and through the Great Recession.

MEDIA CONTACT

Joel Crampton
Director of Marketing
(913) 647-9881
Email

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Terms of Use – Email lists are created for use by U.S. investment professionals only and are published strictly for informational purposes. Providing access to the content of these emails does not explicitly or implicitly constitute a solicitation of services or products of the Buffalo Funds, Kornitzer Capital Management, or any of their affiliates. The information contained in the emails is not intended for distribution to, or for use by, investment professionals in a jurisdiction where distribution or purchase is not authorized. The information contained in these emails is not appropriate for use by individual investors. By registering for any of these emails, you agree to Buffalo's terms and conditions and that you are qualified as an institutional investor or otherwise member of a registered broker/dealer, registered investment advisor, or investment consulting firm.

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