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


As the global COVID-19 pandemic worsened, the Federal Reserve (Fed) made two emergency rate cuts in March bringing the fed funds rate back to zero. The Fed also announced massive asset purchases, expanding its balance sheet to its largest ever, in order to provide liquidity to markets facing unprecedented challenges. In order to reassure markets, the Fed has expressed a willingness to do more if necessary, and Congress has taken massive fiscal measures to alleviate the economic woes facing all sectors and industries domestically. Given these extraordinary conditions and “shelter-in-place” orders across the country,a flight to safety ensued as risk appetites vanished. The 10-year Treasury yield decreased 125 basis points (bps) from 1.92% to 0.67% while the 10-year municipal yield decreased 11 bps from 1.44% to 1.33% during the quarter. The 10-year muni/treasury ratio increased to 198%. Credit spreads widened dramatically during the quarter. Bloomberg Barclay’s high yield muni index underperformed their investment grade index by 325 bps for the quarter. Longer bonds underperformed shorter bonds while General Obligation (GO) bonds outperformed revenue sectors during the quarter. Lower quality bonds underperformed their higher quality counterparts as safe-haven assets were in favor.

For the first quarter, The Commerce National Tax-Free Fund’s return of 0.54% outperformed the Bloomberg Barclays’ 3-15 Year Blend benchmark of -0.55%. Maturities 8 years and longer were the most additive. Limited tax and general obligation sectors performed the best. The Fund’s exposures to the transportation and higher education sectors lagged.

Total Fund Assets as of 3/31/2020 $411,413,279
Net Asset Value1 $20.07
Effective Duration2 4.92 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

April 2020*
May 2020*

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.