MainStay Convertible Fund

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2017 Lipper Award Winner

Investment
Subadvisor

 MacKay Shields

MacKay ShieldsMacKay Shields LLC is an affiliate of New York Life Investment Management LLC. MacKay Shields has specialized in money management for over 70 years. They offer a broad range of fixed income related strategies and solutions for a wide array of global clients including pension funds, government and financial institutions, family offices, high net worth individuals, endowments and foundations, and retail clients.

Portfolio Manager

  • Edward Silverstein, CFA
  • Fund's Manager:
    Since 2001

    Industry Experience:
    23 years

  • Summary
  • Performance
  • Portfolio
  • Distributions
    & Yields
  • Fees &
    Expenses

Fund Objective: Seeks capital appreciation together with current income.

  • “Sweet Spot” orientation
    Investment in securities for total return, seeking capital appreciation potential of the underlying equity while retaining fixed-income characteristics.

  • Managing downside exposure
    The team uses a strict sell discipline to manage risk. They set price targets and sell when warranted by a change in fundamentals or valuation.

  • Tenured team
    The lead manager has over 20 years investment experience, has been with MacKay Shields for most of his career and has been managing the fund for over 10 years.

Class A & INV: 5.5% maximum initial sales charge; a 1% CDSC may be imposed on certain redemptions made within 24 months of the date of purchase on shares that were purchased without an initial sales charge. Class B: CDSC up to 5% if redeemed within six years. Class C: 1% CDSC if redeemed within one year. Class I: No initial sales charge or CDSC. Total annual operating expenses are: Class A: 1.01%, INV: 1.18%, B: 1.93%, C: 1.93%, I: 0.76%. Total annual operating expenses after recoupments/waivers/reimbursements are: Class I: 0.61%.

Returns represent past performance which is no guarantee of future results. Current performance may be lower or higher. Investment return and principal value will fluctuate, and shares, when redeemed, may be worth more or less than their original cost.

Effective 2/28/17, Class B shares are closed to new investors and new share purchases. Existing Class B shareholders may continue to reinvest dividends and capital gains distributions, as well as exchange their Class B shares for Class B shares of other Funds as permitted by the current exchange privileges. Existing Class B shareholders can find more information in the Fund's current prospectus.

Before You Invest

Issuers of convertible securities may not be as financially strong as those issuing securities with higher credit ratings and may be more vulnerable to changes in the economy. High-yield securities (commonly referred to as “junk bonds”) are generally considered speculative because they present a greater risk of loss than higher-quality debt securities and may be subject to greater price volatility. Foreign securities may be subject to greater risks than U.S. investments, including currency fluctuations, less liquid trading markets, greater price volatility, political and economic instability, less publicly available information, and changes in tax or currency laws or monetary policy. These risks are likely to be greater for emerging markets than in developed markets. Funds that invest in bonds are subject to interest-rate risk and can lose principal value when interest rates rise. Bonds are also subject to credit risk, in which the bond issuer may fail to pay interest and principal in a timely manner.

Disclosure

1. POP (Public Offering Price) is the NAV (Net Asset Value) plus a sales charge. All POPs are subject to revision and include the maximum sales charge.

2. Average annual total returns shown include the change in share price and reinvestment of dividends and capital gain distributions. Performance for Class A, C, and I shares includes the historical performance of Class B shares from inception (5/1/86) through 12/31/94 for Class A, through 8/31/98 for Class C, and through 11/27/08 for Class I, adjusted to reflect the applicable sales charge (or CDSC) and fees and expenses. Performance for Investor Class shares includes the historical performance of Class A shares from inception through 2/27/08 adjusted to reflect the applicable fees and expenses. Class I shares are generally available only to corporate and institutional investors.

4. No sales charge applies to Class A and Investor Class share investments of $1,000,000 or more ($250,000 or more with respect to MainStay California Tax Free Opportunities Fund, MainStay High Yield Municipal Bond Fund, MainStay New York Tax Free Opportunities Fund, MainStay Tax Advantaged Short Term Bond Fund, and MainStay Tax Free Bond Fund; or $500,000 or more with respect to MainStay Floating Rate Fund and MainStay Short Duration High Yield Fund). Effective January 1, 2017, a CDSC of 1% may be imposed on certain redemptions of such shares within 24 months of the date of purchase.

Investment Definitions

The Bank of America Merrill Lynch All U.S. Convertible Index is an unmanaged market-capitalization weighted index of domestic corporate convertible securities—to be included in the Index, bonds and preferred stocks must be convertible only to common stock and have a market value or original par value of at least $50 million. Index results assume the reinvestment of all capital gain and dividend distributions. An investment cannot be made directly into an index.

The P/E Ratio (price-to-earnings) denotes the weighted average of all the P/Es of the securities in the Fund's portfolio. The P/B Ratio (price-to-book) is the weighted average of all the P/Bs of the securities in the Fund's portfolio. Return on Equity (ROE) is the weighted average of all the ROEs of the securities in the Fund's portfolio. ROE is calculated by dividing net income by book value. Standard deviation measures how widely dispersed a fund's returns have been over a specified period of time. A high standard deviation indicates that the range is wide, implying greater potential for volatility. Beta is a measure of historical volatility relative to an appropriate index (benchmark) based on its investment objective. A beta greater than 1.00 indicates volatility greater than the benchmark's. Alpha measures a fund's risk-adjusted performance and is expressed as an annualized percentage. R-Squared measures the percentage of a fund's movements that result from movements in the index. The Sharpe Ratio shown is calculated for the past 36-month period by dividing annualized excess returns by annualized standard deviation. The Annual Turnover Rate is as of the most recent annual shareholder report. Upside/Downside Market Capture measures a manager's performance in up/down markets relative to the Fund's benchmark.