Quick Facts
InvestorInstitutional
Ticker:BUFBXBUIBX
Inception Date:8/12/19947/1/2019
Expense Ratio:1.02%0.87%
Total Net Assets:$442.10 Million  (6/30/20)
Category:Large Cap Value
Benchmark:Morningstar Moderately Aggressive Target Risk
Dividend Distribution:Monthly
Related Material:
   Fund Fact Sheet Q2 2020
   PM Commentary Q2 2020
   Summary Prospectus
Fund Objective & Investment Process

The investment objective of the Buffalo Flexible Income Fund is primarily the generation of high current income and, as a secondary objective, the long-term growth of capital.

To pursue its investment objectives, the Flexible Income Fund invests in both debt and equity securities.

The allocation of assets invested in each type of security is designed to balance income and long-term capital appreciation with reduced volatility of returns. The Flexible Income Fund expects to change its allocation mix over time based on the Fund managers’ view of economic conditions and underlying security values.

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Our investment strategy seeks to generate yield for any investor needing monthly income with capital appreciation, and we use many methods to address potential downside risks.

John Kornitzer, Portfolio Manager

Morningstar Rating

       

Overall Morningstar Rating™ of BUFBX based on risk-adjusted returns among 155 Allocation 85%+ Equity funds as of 7/31/20.

Investment Style

Performance (%)

As of 6/30/203 MOYTD1 YR3 YR5 YR10 YR15 YR20 YRSince Inception
(8/12/94)
BUFFALO FLEXIBLE INCOME FUND - Investor5.38-9.59-4.402.823.986.915.965.766.67
BUFFALO FLEXIBLE INCOME FUND - Institutional5.36-9.50-4.242.964.137.076.125.916.83
  Morningstar Moderately Aggressive Target Risk Index10.94-1.625.436.517.168.776.936.31-
  Combined Index
    Morningstar U.S. Large Cap Index (60%)
    ICE BofAML U.S. High Yield Index (40%)
12.28
13.37
10.64
3.02
5.18
-0.23
10.58
15.56
3.10
9.78
13.52
4.16
9.71
12.39
5.69
11.24
14.32
6.61
8.32
9.26
6.91
6.35
5.91
7.02
8.83
9.84
7.32
  Lipper Mixed-Asset Target Allocation Moderate Funds Index9.201.366.575.965.987.365.575.266.88
  Morningstar Allocation 85%+ Equity Category12.26-3.872.954.845.699.156.135.147.07
As of 6/30/203 MOYTD1 YR3 YR5 YR10 YR15 YR20 YRSince Inception
(8/12/94)
BUFFALO FLEXIBLE INCOME FUND - Investor17.00-11.45-6.322.893.527.145.995.586.61
BUFFALO FLEXIBLE INCOME FUND - Institutional16.98-11.38-6.233.033.667.306.145.736.76
  Morningstar Moderately Aggressive Target Risk Index15.93-5.621.465.776.298.976.856.01-
  Combined Index
    Morningstar U.S. Large Cap Index (60%)
    ICE BofAML U.S. High Yield Index (40%)
16.39
20.91
9.61
-2.33
-0.69
-4.78
6.05
10.82
-1.10
8.47
12.16
2.94
8.80
11.62
4.58
11.26
14.44
6.48
8.13
9.09
6.68
6.03
5.52
6.80
8.64
9.63
7.15
  Lipper Mixed-Asset Target Allocation Moderate Funds Index12.72-2.153.375.235.347.505.485.086.76
  Morningstar Allocation 85%+ Equity Category18.96-8.39-1.383.904.859.376.084.856.91
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.
Hypothetical Growth of $10,000
This chart illustrates the performance of a hypothetical $10,000 investment made in the Fund on the inception date of the benchmark index (1/1/99). Assumes reinvestment of dividends and capital gains. This chart does not imply future performance.
Distributions
2020 Distribution Dates:

Record Date: August 17, 2020 | Payable Date: August 18, 2020

Record Date: September 17, 2020 | Payable Date: September 18, 2020

Record Date: October 19, 2020 | Payable Date: October 20, 2020

Record Date: November 17, 2020 | Payable Date: November 18, 2020

Record Date: December 17, 2020 | Payable Date: December 18, 2020


Record
Date
Payable
Date
Distribution
NAV
Net Investment
Income
Short-Term Capital
Gains
Long-Term Capital
Gains
Distribution
Total
7/17/207/20/20$14.10 (Inv)

$14.09 (Inst)
$0.01198759

$0.01372148
-

-
-

-
$0.01198759

$0.01372148
6/17/206/18/20$14.03 (Inv)

$14.02 (Inst)
$0.02676727

$0.03115148
-

-
-

-
$0.02676727

$0.03115148
5/18/205/19/20$13.31 (Inv)

$13.31 (Inst)
$0.03550457

$0.03721941
-

-
-

-
$0.03550457

$0.03721941
4/17/204/20/20$13.02 (Inv)

$13.02 (Inst)
$0.00378510

$0.00533692
-

-
-

-
$0.00378510

$0.00533692
3/17/203/18/20$11.18 (Inv)

$11.17 (Inst)
$0.02710948

$0.02877999
-

-
-

-
$0.02710948

$0.02877999
2/18/202/19/20$16.01 (Inv)

$16.01 (Inst)
$0.02114417

$0.02219948
-

-
-

-
$0.02114417

$0.02219948
1/17/201/21/20$16.04 (Inv)

$16.04 (Inst)
$0.01794007

$0.02027910
-

-
-

-
$0.01794007

$0.02027910
For historical distributions, click here.

Portfolio

Portfolio Characteristics
(As of 6/30/20) 
 
# of Equity Holdings56
# of Fixed Holdings3
Median Market Cap$48.20 B
Weighted Average Market Cap$1225.76 B
3-Yr Annualized Turnover Ratio4.30%
Average Duration1.57 years
Average Maturity7.69 years
30-day SEC Yield2.45%
Top 10 Holdings
HoldingTickerSector% of Net
Assets
MicrosoftMSFTTechnology6.07%
IntelINTCTechnology3.72%
Procter & GamblePGConsumer Staples3.51%
CloroxCLXConsumer Staples3.49%
Johnson & JohnsonJNJHealth Care3.38%
Costco WholesaleCOSTConsumer Staples3.08%
VerizonVZTelecommunication3.03%
Digital Realty TrustDLRReal Estate2.91%
PepsiCoPEPConsumer Staples2.80%
ChevronCVXEnergy2.67%
TOP 10 HOLDINGS TOTAL34.66%
As of 3/31/20. 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.
Sector Weighting
As of 6/30/20. 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.
Asset Allocation
As of 6/30/20. Allocation percentages may not equal 100% due to rounding.

Management

John Kornitzer
Portfolio Manager

51 Years of Experience

 View full bio

Paul Dlugosch, CFA
Portfolio Manager

22 Years of Experience

 View full bio

Commentary

CAPITAL MARKET OVERVIEW

(As of 6/30/20) — Equity markets rebounded sharply in the 2nd quarter following steep losses in the previous period. The S&P 500 Index produced a return of 20.54%, marking the best quarterly performance results in 20 years. Stimulus efforts by the Federal Reserve (the “Fed”) and the U.S. Treasury Department to limit COVID-related economic damage helped equity markets find a floor in late March. Declining COVID-19 case counts, optimism about treatment and potential vaccines, along with better-than-expected economic data also contributed to improved investor sentiment during the period. Although confirmed virus cases began spiking again in the final days of June, it was not enough to undo the best quarterly market results since the dot-com boom.

The broad market Russell 3000 Index advanced 22.03% in the quarter, and Growth outperformed Value as the Russell 3000 Growth Index moved up 27.99% during the period, compared to the Russell 3000 Value Index’s advance of 14.55%. Relative performance was inversely-correlated by market cap as the Russell Micro Cap Index advanced 30.54%, well above the large cap Russell 1000 Index’s return of 21.82%. Meanwhile the small cap Russell 2000 Index and the Russell Mid Cap Index were up 25.42% and 24.61%, respectively. The best performing sectors were Technology, Consumer Discretionary, and Energy while the less cyclically exposed, more defensive areas like Utilities, Telecommunication, and Consumer Staples lagged in the quarter.

PERFORMANCE COMMENTARY

(As of 6/30/20) — The Buffalo Flexible Income Fund (BUFBX) produced a return of 17.00% for the quarter and outperformed the Morningstar Moderately Aggressive Target Risk Index return of 15.93%. The Fund’s peer group index, the Lipper Mixed-Asset Target Allocation Moderate Funds Index, produced a return of 12.72% for the quarter. The relative outperformance was driven by the Fund’s overweight allocation to equities and meaningful exposure to the Energy sector, a strong performing sector during the period.

PORTFOLIO PERFORMANCE

The top three contributors to the Fund’s performance during the quarter were Microsoft, Apache, and Hess while the top three detractors were Royal Dutch Shell, BP, and Boeing. In the current low interest rate environment, we are focused on dividend-paying equities and maintain an underweight allocation to traditional fixed income securities.

OUTLOOK

(As of 6/30/20) — The primary driver of the sharp rise in the stock market during the quarter was the expectations that the economy can recover from the COVID-19 pandemic. Central Banks have cut benchmark lending rates and expanded their balance sheets as they buy various assets of eligible securities. Investors have reacted by accumulating more risk assets, as they have been driven by the need to boost returns as well as the perception that Central Banks stand ready as a back stop to bail them out. The fiscal stimulus and financial aid programs passed by governments have begun to work their way into the economy. If the economy does not recover, politicians appear to be reluctantly willing to pass additional stimulus as needed. In addition, during the quarter, COVID-19 cases started to decline from peak levels, allowing domestic and international regions to reduce shelter in place orders and slowly get back to work. Nevertheless, as the restrictions relaxed, the COVID-19 case count has begun to accelerate from trough levels. However, policy makers appear reluctant to re-impose shelter in place orders. Several promising therapies appear to lessen the death rate of the virus, but, over the intermediate term, for the economy to recover and generate sustainable growth, the pandemic will need to be contained through vaccine development, which still appears several quarters out.

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
  RMD Waiver   NEW
  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 Flexible Income Fund (BUFBX) received 2 stars among 155 for the 3-year, 2 stars among 138 for the 5-year, and 2 stars among 101 Allocation 85%+ Equity funds for the 10-year period ending 7/31/20.

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. ©2020 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.