Leading research firm cites low fees and risk awareness of Baird bond funds

MILWAUKEE, WI, March 25, 2021 /24-7PressRelease/ — Employee-owned Baird announced today that a recent Morningstar report for financial professionals ranked the Baird Funds #1 out of the top 150 Fund Families.

Morningstar wrote of the Baird Funds, “Under the leadership of longtime CIO Mary Ellen Stanek, Baird’s bond funds continue to impress. Boasting low fees, a well-resourced team, and risk-aware investment processes, they constitute over 90% of the firm’s assets under management, expanding from $37 billion in 2016 to $88 billion today.” Additionally, Morningstar recently rated three Baird Funds its highest gold rating: Baird Short-Term Bond Fund (BSBIX), Baird Ultra-Short Bond Fund (BUBIX) and Baird Aggregate Bond Fund (BAGIX).

Fund Family Rank
Baird 1 of 150
Dodge & Cox 2 of 150
American Funds 3 of 150
TCW/MetWest 4 of 150
Charles Schwab 5 of 150
Source: Morningstar

“We’re very proud of this recognition as it is a result of always putting our clients’ interests first,” said Mary Ellen Stanek, CFA, Chief Investment Officer of Baird Advisors and President of Baird Funds. “Our focus has always been on implementing a disciplined, risk-controlled process that delivers consistent, competitive returns against peers and benchmarks while offering these products to investors at a price that is very attractive.”

The report considers the largest 150 fund families that together hold over 98% of the $23.2 trillion in assets invested in U.S. open-ended mutual funds and ETFs. Morningstar evaluated factors including analyst rating upgrades and downgrades, assets managed that receive a medalist rating, parent analysis/rating, fees, cash flows, fund liquidations/mergers, manager investment, manager retention, manager tenure, market share, organic growth rate, scorecard rank and success ratio.

From 1 to 150, a fund family’s Quantitative Rank helps investors evaluate fund families based on the quality of their fund lineup. The rankings are based on the asset-weighted average of individual fund scores from each fund family.

The fund scores are determined by Morningstar’s Scorecards and serve as the building blocks for determining each fund family’s Rank. While many investors are familiar with fund rankings based on past performance, Morningstar’s Scorecards rank funds on data points that, when combined, are more likely to correlate with future risk-adjusted performance.

About Baird Funds
Baird Funds is a no-load mutual fund family with more than $90 billion in assets as of February 28, 2021. The Baird Funds offer proven track records and a variety of portfolios spanning fixed income and equity asset classes. The 10 bond funds and six stock funds feature competitive fees and are managed with a careful focus on risk control. For more information, visit www.bairdfunds.com.

About Baird
Putting clients first since 1919, Baird is an employee-owned, international wealth management, asset management, investment banking/capital markets, and private equity firm with offices in the United States, Europe and Asia. Baird has approximately 4,600 associates serving the needs of individual, corporate, institutional and municipal clients and more than $305 billion in client assets as of June 30, 2020. Committed to being a great workplace, Baird ranked No. 13 on the Fortune 2020 100 Best Companies to Work For list, the firm’s 17th consecutive year in the list. Baird is the marketing name of Baird Financial Group. Baird’s principal operating subsidiaries are Robert W. Baird & Co. Incorporated in the United States and Robert W. Baird Group Ltd. in Europe. Baird also has an operating subsidiary in Asia supporting Baird’s investment banking and private equity operations. For more information, please visit Baird’s website at www.rwbaird.com.

Investors should carefully consider investment objectives, risks, charges and expenses. This and other important information is contained in the fund prospectuses and summary prospectuses, which can be obtained from a financial professional and should be read carefully before investing.

Source: “Fund Family 150” by Michael Laske, published as of March 2, 2021. (c) 2021 Morningstar Research Services LLC. All Rights Reserved. Based on a rank of asset-weighted fund scores for the 150 largest US fund families compared in the report.

Click here to view the most recent performance and Morningstar category rankings of all Baird Funds.

© 2021 Morningstar. All Rights Reserved. The information contained herein: (1) is proprietary to Morningstar and/or its content providers; (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 Analyst Rating™ is not a credit or risk rating. It is a subjective evaluation performed by Morningstar’s manager research group, which consists of various Morningstar, Inc. subsidiaries (“Manager Research Group”). In the United States, that subsidiary is Morningstar Research Services LLC, which is registered with and governed by the U.S. Securities and Exchange Commission. The Manager Research Group evaluates funds based on five key pillars, which are process, performance, people, parent, and price. The Manager Research Group uses this five-pillar evaluation to determine how they believe funds are likely to perform relative to a benchmark over the long term on a risk adjusted basis. They consider quantitative and qualitative factors in their research. For actively managed strategies, people and process each receive a 45% weighting in their analysis, while parent receives a 10% weighting. For passive strategies, process receives an 80% weighting, while people and parent each receive a 10% weighting. For both active and passive strategies, performance has no explicit weight as it is incorporated into the analysis of people and process; price at the share-class level (where applicable) is directly subtracted from an expected gross alpha estimate derived from the analysis of the other pillars. The impact of the weighted pillar scores for people, process and parent on the final Analyst Rating is further modified by a measure of the dispersion of historical alphas among relevant peers. For certain peer groups where standard benchmarking is not applicable, primarily peer groups of funds using alternative investment strategies, the modification by alpha dispersion is not used.

The Analyst Rating scale is Gold, Silver, Bronze, Neutral, and Negative. For active funds, a Morningstar Analyst Rating of Gold, Silver, or Bronze reflects the Manager Research Group’s expectation that an active fund will be able to deliver positive alpha net of fees relative to the standard benchmark index assigned to the Morningstar category. The level of the rating relates to the level of expected positive net alpha relative to Morningstar category peers for active funds. For passive funds, a Morningstar Analyst Rating of Gold, Silver, or Bronze reflects the Manager Research Group’s expectation that a fund will be able to deliver a higher alpha net of fees than the lesser of the relevant Morningstar category median or 0. The level of the rating relates to the level of expected net alpha relative to Morningstar category peers for passive funds. For certain peer groups where standard benchmarking is not applicable, primarily peer groups of funds using alternative investment strategies, a Morningstar Analyst Rating of Gold, Silver, or Bronze reflects the Manager Research Group’s expectation that a fund will deliver a weighted pillar score above a predetermined threshold within its peer group. Analyst Ratings ultimately reflect the Manager Research Group’s overall assessment, are overseen by an Analyst Rating Committee, and are continuously monitored and reevaluated at least every 14 months.

For more detailed information about Morningstar’s Analyst Rating, including its methodology, please go to https://shareholders.morningstar.com/investor-relations/governance/Compliance–Disclosure/default.aspx.

The Morningstar Analyst Rating (i) should not be used as the sole basis in evaluating a fund, (ii) involves unknown risks and uncertainties which may cause the Manager Research Group’s expectations not to occur or to differ significantly from what they expected, and (iii) should not be considered an offer or solicitation to buy or sell the fund.

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