National Tax-Free Intermediate Bond Fund



Seeks current income exempt from federal income tax consistent with the preservation of capital.


Focuses on a broad range of investment-grade municipal securities, typically issued by or on behalf of the states, territories and possessions of the United States, the District of Columbia, and their respective authorities, agencies, instrumentalities and political subdivisions.

Fund Manager

Brian P. Musielak, CFA

  • Joined Commerce in 1995
  • 22 years of experience
  • Fund Manager since 1999


LOW - - • - - - - HIGH

In general, greater returns are associated with greater risks.

Fund Statistics

Inception Date 02/21/95
Ticker Symbol CFNLX
Cusip 200626703
Minimum Initial Investment $1,000


The Federal Reserve (Fed) raised rates another 25 basis points (bps) in December which marked the fourth time in 2018. Strong domestic economic growth coupled with the Fed action, have pressured both Treasury and municipal (muni) rates higher for the year. However, this trend for both markets reversed course beginning in November as global growth expectations for the coming year dampened. The 10-year Treasury yield decreased 38bps from 3.06% to 2.68% while the 10-year municipal yield decreased 30bps from 2.58% to 2.28% during the quarter. The Markets expect two rate hikes of 25bps for the coming year while inflation expectations remain subdued. Credit spreads widened somewhat over the last quarter as the Bloomberg Barclay’s High Yield Muni Index underperformed their investment grade index by 139bps for the quarter. Longer bonds outperformed shorter bonds while General Obligation (GO) bonds outperformed revenue sectors during the quarter. Lower quality bonds lagged higher quality counterparts as perceived safe-haven credits were favored.

For the fourth quarter, the Fund’s return of 1.83% outperformed the Bloomberg Barclays’ 3-15 Year Blend benchmark of 1.81%. Maturities 4 years and longer were additive as were the GO, limited tax, and lease sectors. The Fund’s exposures to the pre-refunded, power and water/sewer sectors hampered returns.
Total Fund Assets as of 12/31/2018 $360,427,526
Net Asset Value1 $19.29
Effective Duration2 5.87 Yrs.

1. The Net Asset Value represents the assets of the fund (ex dividend) by the total number of shares.
2. Duration is the method determining a bond's price sensitivity, given changes in interest rates.
3. The composition of the portfolio is subject to change in the future.
4. The Fund's investments may subject shareholders to federal alternative minimum tax, and investment income may be subject to state income taxes.

Portfolio Holdings

Investments in fixed income securities are subject to the risks associated with debt securities including credit and interest rate risk. When interest rates rise, the prices of bonds and therefore the value of fixed income mutual fund shares can decrease and an investor can lose principal value. The guarantee on U.S. government securities applies only to the underlying securities of the Fund if held to maturity and not to the value of the Fund's shares. Mortgage-backed securities are subject to prepayment risks. These risks may result in greater share price volatility.

Holdings and allocations shown are unaudited, and may not be representative of current or future investments. Holdings and allocations may not include the Fund's entire investment portfolio, which may change at any time. Fund holdings should not be relied on in making investment decisions and should not be construed as research or investment advice regarding particular securities.

Commerce National Tax-Free Intermediate Bond Holdings

January 2019*
February 2019*
March 2019*

A prospectus for the Commerce Funds containing more complete information may be obtained by calling 1-800-995-6365 or by downloading it from this website. Please consider a Fund's objectives, risks, and charges and expenses, and read the prospectus carefully before investing. The prospectus contains this and other information about the Fund.

The mutual funds referred to in this Web site are offered and sold only to persons residing in the United States and are offered by prospectus only. The prospectus contains more complete information about the funds, including charges and expenses, and should be read carefully before investing.