The Fund’s primary investment objective is to provide investors with the maximum income exempt from federal income taxes while avoiding undue risk to principal. Capital appreciation is a secondary objective but only when consistent with the Fund’s primary objective.
To achieve the Fund's investment objectives, under normal conditions, the Adviser invests at least 80% of the Fund's assets in securities the income of which is exempt from regular federal income taxation and will not subject non-corporate shareholders to the alternative minimum tax. The Fund invests primarily in investment grade municipal bonds and expects to maintain an average maturity of between 7 and 20 years.
Average Annual Returns as of 05/31/21
|VLHYX||BC Muni Bond Index||MMNLF|
VLHYX Gross / Net Expense Ratio*: 1.16% / 0.91%
Morningstar rates funds based on enhanced Morningstar risk-adjusted returns.
The economic stability and moderate growth, that marked the beginning of 2020, was severely interrupted by the devastation wrought by the coronavirus. The S&P 500 Index reached a high point of 3,393 on February 19, 2020, and as the virus caused a lockdown in most parts of the U.S., plunged 1,202 points, to a low point of 2,192 on March 23. This represented a drop of 35% in only one month. Businesses and other workplaces were shutdown, unemployment leapt from 3.5% at the end of 2019 to 14.7% in April. Airplane travel and other transportation ways came to a halt. The health and economic crisis, caused by the coronavirus, was worldwide, as most other countries were hit by the virus, which originated in China, at the beginning of the 2020.
The lockdown was lengthy , lasting several months, and widespread, causing the U.S. economy, as well as the world economy, to go into a recession. U.S GDP, which registered 2.1% in the final quarter of 2019, dropped to negative growth of -5.0% in the first quarter of 2020. Other economic indicators dramatically fell. Because of the severe rise in unemployment, retail sales dropped precipitously. In January of 2020, retail sales came out at 0.8. For the period of February to May, where the lockdown was most pronounced, retail sales fell to a -5.6%, an average decline of -1.4, per month. U.S. job growth plummeted. For the first two months of 2020, job growth averaged 232,00. But in April alone, the economy lost over 20,000 jobs, and the unemployment rate reached a high of 14.7% . Manufacturing significantly weakened with the ISM Manufacturing Survey going from a peak reading of over 50 to a low of 41 in April. The service sector, the largest sector of the economy, took a hit. It fell to 41.8 in April, from 57.5, earlier in the year, before the virus halted the growth of the economy.
With the situation dire, worry over potential corporate bankruptcies and mortgage defaults, and fears of a depression taking hold, monetary and fiscal authorities sprang into action. The U.S. Federal Reserve Bank supported the financial markets by dropping short-term interest rates close to zero. U.S. treasury rates dropped as a result, with the 2-year treasury falling to 0.15% and the longer maturity 10-year declining to 0.65% at the end of the period. In addition, the Fed made money available in most markets, investment grade corporate bonds, mortgage-backed securities, agency mortgages, and even supported the riskier high yield sector, which was unprecedented. These markets had experienced tremendous losses, but the Fed’s actions stemmed the plunge. The federal government came with a massive rescue package, which included stimulus checks to many Americans, billions to small business, and increases in unemployment insurance. These monetary and fiscal measures stemmed a further decline, stabilizing economic conditions.
Morningstar as of 05/31/21
|Category||Muni National Long|
|3 Year||of 145 Funds|
|5 Year||of 123 Funds|
|10 Year||of 99 Funds|
|Overall||of 145 Funds|
* EULAV Securities LLC (the “Distributor”) has contractually agreed to waive the Fund’s 12b-1 fee in an amount equal to 0.25% of the Fund’s average daily net assets through June 30, 2022. The waiver cannot be terminated before June 30, 2022 without the approval of the Fund’s Board of Directors. There is no assurance that the Distributor will extend the fee waiver beyond June 30, 2022. The Fund's performance would be lower in the absence of such waivers.
The performance data quoted herein represents past performance and does not guarantee future results. Market volatility can dramatically impact the fund's short term performance. Current performance may be lower or higher than figures shown. The investment return and principal value will fluctuate so that an investor's shares, when redeemed may be worth more or less than their original cost. Past performance data through the most recent month end is available at vlfunds.com or by calling 1-800-243-2729.
You should carefully consider investment objectives, risks, charges and expenses of Value Line Funds before investing. This and other information can be found in the fund's prospectus and summary prospectus, which can be obtained free of charge from your investment representative, by calling 800.243.2729, or by clicking on the applicable fund at www.vlfunds.com. Please read it carefully before you invest or send money. Value Line Funds are distributed by EULAV Securities LLC. Past performance is no guarantee of future results.
Portfolio holdings are subject to change and should not be considered a recommendation to buy or sell securities. Current and future portfolio holdings are subject to risk.
The average annual returns shown above are historical and reflect changes in share price, reinvested dividends and are net of expenses. Investment results and the principal value of an investment will vary.
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. VLIFX (3 Year / 4 stars / 547 funds; 5 Year / 3 stars / 490 funds; 10 Year / 4 stars / 380 funds; ) VALLX (3 Year / 2 stars / 1141 funds; 5 Year / 3 stars / 1028 funds; 10 Year / 3 stars / 758 funds; ) VLEOX (3 Year / 3 stars / 582 funds; 5 Year / 3 stars / 506 funds; 10 Year / 4 stars / 385 funds; ) VALSX (3 Year / 3 stars / 1141 funds; 5 Year / 2 stars / 1028 funds; 10 Year / 2 stars / 758 funds; ) VLAAX (3 Year / 4 stars / 661 funds; 5 Year / 4 stars / 604 funds; 10 Year / 5 stars / 425 funds; ) VALIX (3 Year / 5 stars / 292 funds; 5 Year / 5 stars / 266 funds; 10 Year / 5 stars / 183 funds; ) VAGIX (3 Year / 2 stars / 393 funds; 5 Year / 2 stars / 341 funds; 10 Year / 2 stars / 259 funds; ) VLHYX (3 Year / 1 stars / 145 funds; 5 Year / 1 stars / 123 funds; 10 Year / 1 stars / 99 funds; )
Source: Morningstar Direct