Fund info

T. Rowe Price Short-Term Bond Fund is an actively managed mutual fund focused on generating a high level of income while aiming to keep principal fluctuations minimal and maintain liquidity. It invests predominantly in investment-grade, short- to intermediate‑term debt, including corporate bonds, U.S. government securities, and asset- and mortgage‑backed securities, with flexibility to allocate to bank obligations and select foreign issues. The portfolio typically holds at least 80% in bonds and maintains an average effective maturity that normally does not exceed three years, positioning it in the short-term bond category. The fund’s profile emphasizes moderate credit quality and limited interest rate sensitivity, reflected in an effective duration under two years. It distributes income monthly and has a long operating history since 1984 under T. Rowe Price’s fixed income platform. Within the market, it serves as a core short-duration option for investors seeking diversified investment‑grade exposure and income generation with a conservative risk posture relative to longer‑duration bond strategies.