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Ivy High Income Fund

  • $7.54 NAV as of 3/27/2017
  • ($0.00) / 0.00% Daily NAV Change
  • 2.10% YTD (NAV)

Summary

Seeking to increase income potential through credit selection

Flexibility
The Fund has the ability to invest in the full spectrum of credit instruments including both bonds and loans.
Management discipline
A high priority on individual credit selection instead of sector bets on future market direction.
Income
The potential to generate higher levels of income than an investment-grade portfolio, although at greater risk.

Morningstar Style Box

LTD
Low
Source: Morningstar

Portfolio Management

Chad Gunther

  • Ivy Investment Management Company
  • 2 Years with Fund
  • 19 Years in Industry
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Chad Gunther graduated from the University of Kansas in 1993 with a BS in business administration with an emphasis in economics. He earned an MBA with an emphasis in finance from Washington University/St. Louis Olin Graduate School of Business in 2000. He joined the firm in 2003 as a fixed income investment analyst. He was appointed assistant vice president and assistant portfolio manager of the Ivy High Income Fund, and Ivy Funds VIP High Income in 2008. He was appointed vice president in 2013. He was appointed portfolio manager in 2014. Prior to joining the firm, he was affiliated with Piper Jaffray, George K. Baum & Company and Dialpad Communications.

Growth of a $10,000 Investment
through 2/28/2017

Assumes an investment over 10 years or life of the share class, reinvestment of dividends and capital gains, and does not include the effect of sales charges or taxes.

Documents

Perspectives

Quarterly Fund Commentary

Daily Prices as of 3/27/2017

Net Asset Value (NAV) $7.54
Daily NAV Change ($) ($0.00) 0.00%
Weekly NAV Change ($) $-0.02 -0.26%
Public Offering Price (POP) $7.54

Fund Facts

Ticker Symbol WHIYX
CUSIP 466000635
Fund Code 719
Fund Type Fixed Income Funds
Fund Inception 7/31/1997
Class Inception 12/30/1998
Fiscal Year End March
Dividends Paid Daily, Paid Monthly
Fund Assets (as of 2/28/2017) $4.7 bil
Total Holdings (as of 2/28/2017) 301
Portfolio Turnover Rate (as of 9/30/2016) 19%
Lipper Category High Current Yield Funds
Morningstar Category High Yield Bond
Benchmark BofAML US HY Master II TR USD

Performance

Data quoted is past performance and current performance may be lower or higher. Past performance is no guarantee of future results. Investment return and principal value of an investment will fluctuate, and shares, when redeemed, may be worth more or less than their original cost.

Class Y shares are not subject to sales charges.

Monthly Rates of Return

Average Annual Total Returns as of 2/28/2017
(Returns for periods of less than 1-yr are not annualized)
 
Lipper High Current Yield Funds 2.51% 17.54% 3.28% 5.63% 5.95% 6.19%
BofAML US HY Master II TR USD 2.92% 22.30% 4.78% 6.87% 7.39% 6.97%
Fund at NAV 3.04% 23.92% 3.40% 6.68% 7.74% 7.26%

Quarterly Rates of Return

Average Annual Total Returns as of 12/31/2016
(Returns for periods of less than 1-yr are not annualized)
 
Lipper High Current Yield Funds 13.34% 13.34% 3.25% 6.20% 5.93% 6.09%
Fund at NAV 16.74% 16.74% 3.15% 7.17% 7.77% 7.15%
BofAML US HY Master II TR USD 17.49% 17.49% 4.72% 7.35% 7.34% 6.86%

Calendar Year Return

  2012
BofAML US HY Master II TR USD 15.59 7.42 2.50 -4.64 17.49
Class Y 16.90 10.20 1.48 -7.41 16.78

Morningstar Ratings as of 2/28/2017 Morningstar Logo

Category: High Yield Bond
Ratings are based on risk-adjusted returns
Overall out of 597
3 Year out of 597
5 Year out of 474
10 Year out of 319

Lipper Ranking through 2/28/2017 Lipper Logo

Category: High Current Yield Funds
 
Rankings are based on average annual total returns, but do not consider sales charges.
1 Year 31/681 5
3 Year 283/576 50
5 Year 66/456 15
10 Year 6/309 2

Expense Ratios as of 7/31/2016

Net 0.95%
Gross 0.95%

5-Year Standard Deviation as of 2/28/2017

BofAML US HY Master II TR USD 5.38

5-Year MPT* Statistics as of 2/28/2017

*Modern Portfolio Theory
Alpha 0.20
Beta 0.94
R-Squared 89.17
Sharpe Ratio 1.22
Capture Ratio Upside: 92.82%
Downside: 86.95%

Distributions

Historical Prices Inception 12/30/1998

3/1/2017 $7.66 NO NO
3/2/2017 $7.65 NO NO
3/3/2017 $7.64 NO NO
3/6/2017 $7.63 NO NO
3/7/2017 $7.62 NO NO
3/8/2017 $7.61 NO NO
3/9/2017 $7.58 NO NO
3/10/2017 $7.58 NO NO
3/13/2017 $7.56 NO NO
3/14/2017 $7.54 NO NO
3/15/2017 $7.55 NO NO
3/16/2017 $7.57 NO NO
3/17/2017 $7.57 NO NO
3/20/2017 $7.56 NO NO
3/21/2017 $7.55 NO NO
3/22/2017 $7.54 NO NO
3/23/2017 $7.54 NO NO
3/24/2017 $7.54 NO NO
3/27/2017 $7.54 YES YES

Historical Distributions Inception 12/30/1998

3/27/2017 $0.0317 Long: $0.000 Short: $0.000 $7.54 3/27/2017
2/27/2017 $0.0374 Long: $0.000 Short: $0.000 $7.65 2/27/2017
1/27/2017 $0.0382 Long: $0.000 Short: $0.000 $7.58 1/27/2017
12/30/2016 $0.0556 Long: $0.000 Short: $0.000 $7.49 12/30/2016
11/25/2016 $0.0496 Long: $0.000 Short: $0.000 $7.35 11/25/2016
10/27/2016 $0.0464 Long: $0.000 Short: $0.000 $7.4 10/27/2016
9/27/2016 $0.0462 Long: $0.000 Short: $0.000 $7.37 9/27/2016
8/26/2016 $0.0495 Long: $0.000 Short: $0.000 $7.35 8/26/2016
7/27/2016 $0.0462 Long: $0.000 Short: $0.000 $7.29 7/27/2016
6/27/2016 $0.0438 Long: $0.000 Short: $0.000 $7.08 6/27/2016
5/27/2016 $0.0507 Long: $0.000 Short: $0.000 $7.16 5/27/2016
4/27/2016 $0.0481 Long: $0.000 Short: $0.000 $7.1 4/27/2016
3/24/2016 $0.0426 Long: $0.000 Short: $0.000 $6.9 3/24/2016
2/26/2016 $0.0481 Long: $0.000 Short: $0.000 $6.63 2/26/2016
1/27/2016 $0.0369 Long: $0.000 Short: $0.000 $6.69 1/27/2016
12/31/2015 $0.0521 Long: $0.000 Short: $0.000 $6.94 12/31/2015
11/27/2015 $0.0521 Long: $0.000 Short: $0.000 $7.3 11/27/2015
10/27/2015 $0.0488 Long: $0.000 Short: $0.000 $7.56 10/27/2015
9/25/2015 $0.0502 Long: $0.000 Short: $0.000 $7.55 9/25/2015
8/27/2015 $0.0495 Long: $0.000 Short: $0.000 $7.67 8/27/2015
7/27/2015 $0.0463 Long: $0.000 Short: $0.000 $7.84 7/27/2015
6/26/2015 $0.0493 Long: $0.000 Short: $0.000 $7.98 6/26/2015
5/27/2015 $0.0466 Long: $0.000 Short: $0.000 $8.13 5/27/2015
4/27/2015 $0.0467 Long: $0.000 Short: $0.000 $8.14 4/27/2015
3/27/2015 $0.0443 Long: $0.000 Short: $0.000 $8.08 3/27/2015
2/27/2015 $0.0503 Long: $0.000 Short: $0.000 $8.13 2/27/2015
1/27/2015 $0.0409 Long: $0.000 Short: $0.000 $7.99 1/27/2015
12/31/2014 $0.0555 Long: $0.000 Short: $0.000 $8.07 12/31/2014
12/11/2014 $0 Long: $0.096 Short: $0.046 $8.08 12/11/2014
11/26/2014 $0.0513 Long: $0.000 Short: $0.000 $8.44 11/26/2014
10/27/2014 $0.0432 Long: $0.000 Short: $0.000 $8.52 10/27/2014
9/26/2014 $0.0466 Long: $0.000 Short: $0.000 $8.51 9/26/2014
8/27/2014 $0.0522 Long: $0.000 Short: $0.000 $8.68 8/27/2014
7/25/2014 $0.0453 Long: $0.000 Short: $0.000 $8.7 7/25/2014
6/27/2014 $0.0496 Long: $0.000 Short: $0.000 $8.76 6/27/2014
5/27/2014 $0.0459 Long: $0.000 Short: $0.000 $8.73 5/27/2014
4/25/2014 $0.0473 Long: $0.000 Short: $0.000 $8.72 4/25/2014
3/27/2014 $0.0426 Long: $0.000 Short: $0.000 $8.74 3/27/2014
2/27/2014 $0.0477 Long: $0.000 Short: $0.000 $8.74 2/27/2014
1/27/2014 $0.0377 Long: $0.000 Short: $0.000 $8.66 1/27/2014
12/31/2013 $0.0496 Long: $0.000 Short: $0.000 $8.64 12/31/2013
12/12/2013 $0 Long: $0.075 Short: $0.057 $8.64 12/12/2013
11/27/2013 $0.0533 Long: $0.000 Short: $0.000 $8.77 11/27/2013
10/25/2013 $0.0501 Long: $0.000 Short: $0.000 $8.76 10/25/2013
9/27/2013 $0.0546 Long: $0.000 Short: $0.000 $8.66 9/27/2013
8/27/2013 $0.0522 Long: $0.000 Short: $0.000 $8.59 8/27/2013
7/26/2013 $0.054 Long: $0.000 Short: $0.000 $8.65 7/26/2013
6/27/2013 $0.0525 Long: $0.000 Short: $0.000 $8.53 6/27/2013
5/24/2013 $0.0474 Long: $0.000 Short: $0.000 $8.79 5/24/2013
4/26/2013 $0.0557 Long: $0.000 Short: $0.000 $8.77 4/26/2013
3/27/2013 $0.0446 Long: $0.000 Short: $0.000 $8.72 3/27/2013
2/27/2013 $0.052 Long: $0.000 Short: $0.000 $8.65 2/27/2013
1/25/2013 $0.0456 Long: $0.000 Short: $0.000 $8.67 1/25/2013

*Special Dividend
The table includes the daily prices at NAV (net asset value) for the history of this fund's selected share class. NAV is the amount per share you would receive if you sold shares that day.

12-Month Trailing Dist. Yield as of 2/28/2017

NAV 7.26%
With Sales Charge 7.26%

Annualized 30-Day SEC Yield as of 2/28/2017

Subsidized - NAV 7.89%
Unsubsidized - NAV 7.88%

Portfolio

Top 10 Holdings as a % of net assets 2/28/2017

Misys plc and Magic Newco LLC, 12.0%, 6/12/2019 2.79%
Laureate Education, Inc., 10.0%, 9/1/2019 1.96%
New Cotai LLC and New Cotai Capital Corp., 10.6%, 5/1/2019 1.91%
Altice S.A., 7.8%, 5/15/2022 1.56%
Kronos Acquisition Holdings, Inc., 9.0%, 8/15/2023 1.48%
B-Corp Merger Sub, Inc., 8.3%, 6/1/2019 1.38%
TMX Finance LLC and TitleMax Finance Corp., 8.5%, 9/15/2018 1.38%
Jo-Ann Stores Holdings, Inc., 9.8%, 10/15/2019 1.33%
Patriot Merger Corp., 9.0%, 7/15/2021 1.23%
Numericable - SFR S.A., 7.4%, 5/1/2026 1.14%

Total Portfolio Holdings

Updated quarterly, upon availability.

Maturity
as a % of fixed income assets as of 2/28/2017

<1 Year 6.3%
1-5 Years 47.5%
5-10 Years 46.0%
10-20 Years 0.3%
>20 Years 0.0%
Average Maturity 3.35 years
Effective Duration 2.70 years

Fixed Income Country Allocation
as a % of bond holdings as of 2/28/2017

United States 81.1%
Canada 6.1%
Luxembourg 4.2%
Netherlands 3.1%
France 1.2%
United Kingdom 1.0%
Macau 0.9%
Cayman Islands 0.8%
Australia 0.7%
Hong Kong 0.3%
Ireland 0.2%
Barbados 0.1%
Austria 0.1%
China 0.1%

Quality
as a % of fixed income assets as of 2/28/2017

Quality: Ratings obtained from Standard & Poor's. For securities not rated by Standard & Poor's, ratings are obtained from Moody's. We do not evaluate these ratings, but simply assign them to the appropriate credit quality category as determined by the rating agency.
NonRated 4.90%
BBB 1.50%
BB 15.00%
B 42.00%
CCC 34.80%
Below CCC 1.80%

Portfolio Composition
as a % of net assets as of 2/28/2017

Corporate Bonds 71.88%
Senior Loans 20.31%
Cash and Cash Equivalents 6.49%
Domestic Common Stock 0.77%
Preferred Stock 0.34%
Foreign Common Stock 0.21%

Total Portfolio Holdings

Updated quarterly, upon availability.

Documents

Risk Factors: The value of the Fund's shares will change, and you could lose money on your investment. An investment in the Fund is not a bank deposit and is not insured or guaranteed by the Federal Deposit Insurance Corporation or any other government agency. Fixed income securities are subject to interest rate risk and, as such, the net asset value of the Fund may fall as interest rates rise. Investing in below investment grade securities may carry a greater risk of nonpayment of interest or principal than higher-rated bonds. Loans (including loan assignments, loan participations and other loan instruments) carry other risks, including the risk of insolvency of the lending bank or other intermediary. Loans may be unsecured or not fully collateralized may be subject to restrictions on resale and sometimes trade infrequently on the secondary market. These and other risks are more fully described in the Fund's prospectus. Not all funds or fund classes may be offered at all broker/ dealers.

Stylebox: The Morningstar Fixed Income Style Box reveals a fund’s investment style. The vertical axis shows the credit quality of the bonds owned and the horizontal axis shows interest rate sensitivity as measured by a bond’s effective duration. Morningstar seeks credit rating information from fund companies on a periodic basis (e.g., quarterly). In compiling credit rating information, Morningstar instructs fund companies to only use ratings that have been assigned by a Nationally Recognized Statistical Rating Organization (NRSRO). If two NRSROs have rated a security, fund companies are to report the lowest rating; if three or more NRSROs have rated the same security differently, fund companies are to report the rating that is in the middle. Credit quality breakdowns are shown for corporate-bond holdings and depict the quality of bonds in the underlying portfolio. The report shows the percentage of fixed-income securities that fall within each credit quality rating as assigned by an NRSRO. Bonds not rated by an NRSRO are included in the not rated (NR) category. Please note: Morningstar, Inc. is not itself an NRSRO nor does it issue a credit rating on the fund. An NRSRO rating on a fixed-income security can change from time-to-time. For credit quality, Morningstar combines the credit rating information provided by fund companies with an average default rate calculation to come up with a weighted-average credit quality. The weighted-average credit quality is currently a letter that roughly corresponds to the scale used by a leading NRSRO. Bond funds are assigned a style box placement of “low,” “medium,” or “high” based on their average credit quality. Funds with a low credit quality are those whose weighted-average credit quality is determined to be less than “BBB-;” medium are those less than “AA-,” but greater or equal to “BBB-;” and high are those with a with a weighted-average credit quality of “AA-” or higher. When classifying a bond portfolio, Morningstar first maps the NRSRO credit ratings of the underlying holdings to their respective default rates (as determined by Morningstar’s analysis of actual historical default rates). Morningstar then averages these default rates to determine the average default rate for the entire bond fund. Finally, Morningstar maps this average default rate to its corresponding credit rating along a convex curve. For interest-rate sensitivity, Morningstar obtains from fund companies the average effective duration. Generally, Morningstar classifies a fixed-income fund’s interest-rate sensitivity based on the effective duration of the Morningstar Core Bond Index (MCBI), which is currently three years. The classification of Limited will be assigned to those funds whose average effective duration is between 25% to 75% of MCBI’s average effective duration; funds whose average effective duration is between 75% to 125% of the MCBI will be classified as Moderate; and those that are at 125% or greater of the average effective duration of the MCBI will be classified as Extensive.

Index Description: The BofAML U.S. HY Master II TR USD tracks the performance of U.S. dollar denominated below investment grade corporate debt publicly issued in the U.S. domestic market. It is not possible to invest directly in an index

Performance results for some funds may include the effect of expense reduction arrangements. If those arrangements had not been in place, the performance results would have been lower.

Fee Waiver and/or Expense Reimbursement: Through July 31, 2017, Ivy Investment Management Company (IICO), the Fund’s investment manager, Ivy Distributors, Inc. (IDI), the Fund’s Distributor, and/or Waddell & Reed Services Company, doing business as WI Services Company (WISC), the Fund’s transfer agent, have contractually agreed to reimburse sufficient management fees, 12b-1 fees and/or shareholder servicing fees to cap the total annual ordinary fund operating expenses for the Fund’s Class E shares at 1.20%. Prior to that date, the expense limitation may not be terminated by IICO, IDI, WISC or the Board of Trustees.

Through July 31, 2017, IDI and/or WISC have contractually agreed to reimburse sufficient 12b-1 and/or shareholder servicing fees to ensure that the total annual ordinary fund operating expenses of the Class Y shares do not exceed the total annual ordinary fund operating expenses of the Class A shares, as calculated at the end of each month. Prior to that date, the expense limitation may not be terminated by IDI, WISC or the Board of Trustees.

Pricing: All prices and year-to-date returns are based on closing quotes unless noted, as supplied to the NASDAQ by 6:00 p.m. Eastern time. YTD Prices can be updated 3 to 4 hours after the Daily Pricing information which can result in mismatching data.

Unsubsidized yields reflect what the yield would have been without the effect of reimbursements and waivers. The adviser and its affiliates have or may voluntarily waive a portion of their fees (including, but not limited to, distribution and service (12b-1) fees) and reimburse certain expenses. There is no guarantee that the fund will avoid a negative yield. Such undertaking may be amended or withdrawn at any time.

30-Day SEC Yield: is calculated based on a formula mandated by the Securities and Exchange Commission (SEC) that calculates a fund's hypothetical annualized income, as a percentage of its assets. A security's income, for the purposes of this calculation, is based on the current market yield to maturity (in the case of bonds) or projected dividend yield (for stocks) of the fund's holdings over a trailing 30 day period. This hypothetical income will differ (at times, significantly) from the fund's actual experience; as a result, income distributions from the fund may be higher or lower than implied by the SEC yield.

12-Month Trailing Distribution Yield: at NAV refers to the 12-month historical cash flow paid over the past 12 months in dividends, divided by the past months ending NAV.

Alpha, Beta, R-Squared, Standard Deviation, Sharpe Ratio and Capture Ratio are 5 year statistics. Alpha is a measure of a fund's actual returns and expected performance, given its level of risk (as measured by beta). Beta reflects the sensitivity of the fund's return to fluctuations in the market index. R-squared indicates how much of a fund's fluctuations were attributable to movements in the fund's benchmark. Standard deviation is a measure of how volatile a fund's returns are. Sharpe ratio is a measure of a fund's risk-adjusted performance. Capture ratio reflects the annualized product of fund vs. index returns for all months in which the index had a positive return (upside capture) or negative return (downside capture).

The Morningstar RatingTM 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.

Quality: Ratings obtained from Standard & Poor's. For securities not rated by Standard & Poor's, ratings are obtained from Moody's. We do not evaluate these ratings, but simply assign them to the appropriate credit quality category as determined by the rating agency.

Information is subject to change and is not intended to represent any past or future investment recommendations.

Chad A. Gunther of Ivy Investment Management Company was named portfolio manager of the Fund on July 9, 2014. Prior to that, the Fund was managed by William M. Nelson.

William M. Nelson of Ivy Investment Management Company was named portfolio manager of the Fund on November 21, 2013. From February 1, 2006 through November 20, 2013, the Fund was managed by Bryan C. Krug.

Please remember that an investment in a mutual fund involves risk. Investment return and principal value of a mutual fund investment will fluctuate, and shares, when redeemed, may be worth more or less than their original cost.

YTD Prices can be updated 3 to 4 hours after the Daily Pricing information which can result in mismatching data.

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