N-CSRS

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM N-CSR

CERTIFIED SHAREHOLDER REPORT OF REGISTERED

MANAGEMENT INVESTMENT COMPANIES

Investment Company Act file number:  811-09997

Baird Funds, Inc.

(Exact name of registrant as specified in charter)

777 East Wisconsin Avenue

Milwaukee, WI 53202

(Address of principal executive offices) (Zip code)

Charles M. Weber

Robert W. Baird & Co. Incorporated

777 East Wisconsin Avenue

Milwaukee, WI 53202

(Name and address of agent for service)

1-866-442-2473

Registrant's telephone number, including area code

Date of fiscal year end: December 31, 2009

Date of reporting period:  June 30, 2009

Item 1. Report to Stockholders.

Semi-Annual Report - Baird Funds

June 30, 2009

Baird Short-Term Bond Fund

Baird Intermediate Bond Fund

Baird Intermediate Municipal Bond Fund

Baird Aggregate Bond Fund

Baird Core Plus Bond Fund

TABLE OF CONTENTS

	Page
Baird Short-Term Bond Fund	1
Baird Intermediate Bond Fund	16
Baird Intermediate Municipal Bond Fund	33
Baird Aggregate Bond Fund	48
Baird Core Plus Bond Fund	70
Additional Information on Fund Expenses	88
Statements of Assets and Liabilities	90
Statements of Operations	91
Statements of Changes in Net Assets	92
Financial Highlights	97
Notes to the Financial Statements	106
Additional Information	120

This report has been prepared for shareholders and may be distributed to others only if preceded or accompanied by a current prospectus.

Cautionary Note on Analyses, Opinions and Outlooks:  In this report we offer analyses and opinions on the performance of individual securities, companies, industries, sectors, markets, interest rates and governmental policies, including predictions, forecasts and outlooks regarding possible future events.  These can generally be identified as such because the context of the statements may include such words as “believe,” “should,” “will,” “expects,” “anticipates,” “hopes” and words of similar effect.  These statements reflect the portfolio managers’ good faith beliefs and judgments and involve risks and uncertainties, including the risk that the portfolio managers’ analyses, opinions and outlooks are or will prove to be inaccurate.  It is inherently difficult to correctly assess and explain the performance of particular securities, sectors, markets, interest rate movements, governmental actions or general economic trends and conditions, and many unforeseen factors contribute to the performance of Baird Funds.  Investors are, therefore, cautioned not to place undue reliance on subjective judgments contained in this report.

Baird Short-Term Bond Fund

June 30, 2009

The Baird Short-Term Bond Fund seeks an annual rate of total return, before Fund expenses, greater than the annual rate of total return of the Barclays Capital 1-3 Year U.S. Government/Credit Bond Index.  The Barclays Capital 1-3 Year U.S. Government/Credit Bond Index is an unmanaged, market value weighted index of investment grade, fixed-rate debt issues, including government and corporate securities, with maturities between one and three years.

Portfolio Characteristics

Quality Distribution*	Sector Weightings*

Net Assets:	$375,588,385	Annualized Expense Ratio:
SEC 30-Day Yield:**		Institutional Class:	0.30	%
Institutional Class:	4.53%	Portfolio Turnover Rate:	32.3	%#
Average Effective Duration:	1.89 years	Total Number of Holdings:	237
Average Effective Maturity:	2.50 years

* Percentages shown are based on the Fund’s total net assets.

** SEC yields are based on SEC guidelines and are calculated for the 30 days ended June 30, 2009.

# Not annualized.

Page 1

Baird Short-Term Bond Fund

Average Annual Total Returns

For the Periods Ended June 30, 2009	One Year	Since Inception(1)
Institutional Class	1.12%	3.02%
Barclays Capital 1-3 Year U.S. Government/Credit Bond Index(2)	4.90%	4.10%

(1) For the period from August 31, 2004 (commencement of operations) to June 30, 2009.

(2) The Barclays Capital 1-3 Year U.S. Government/Credit Bond Index is an unmanaged, market value weighted index of investment grade, fixed-rate debt including government and corporate securities with maturities between one and three years.  This index does not reflect any deduction for fees, expenses or taxes.  A direct investment in an index is not possible.

The returns shown in the table above reflect reinvestment of dividends and/or capital gains distributions in additional shares.  Returns do not reflect the deduction of taxes that a shareholder would pay on Fund distributions or the redemption of Fund shares.

Past performance does not guarantee future results.  Investment returns and principal value will fluctuate so that an investor’s shares, when redeemed, may be worth more or less than their original cost.

For information about the performance of the Fund as of the most recent month-end, please call 1-866-44BAIRD or visit www.bairdfunds.com.  Mutual fund performance changes over time and current performance may be lower or higher than that stated.

Page 2

Baird Short-Term Bond Fund

Schedule of Investments       June 30, 2009 (Unaudited)

Principal
Amount			Value
LONG-TERM INVESTMENTS – 95.4%
Asset Backed Securities – 3.9%
		American Express Credit
		Account Master Trust:
$	1,400,000	Series 2004-5, Class A,
		5.42%, 04/16/2012	$	1,398,817
	1,050,000	Series 2005-5, Class A,
		4.276%, 02/15/2013		1,040,925
	47,888	Bombardier Capital
		Mortgage Securitization,
		Series 1998-A, Class A3,
		6.23%, 04/15/2028		39,196
	413,669	Capital Auto Receivables
		Asset Trust, Series
		2006-SN1A, Class A4B,
		4.388%, 03/20/2010
		(Acquired 09/29/2008
		and 11/28/2008; Cost
		$107,183 and $305,061,
		respectively) *		413,669
	600,000	Chase Issuance Trust,
		Series 2005-A10, Class
		A10, 4.65%, 12/17/2012		619,580
	263,749	CitiFinancial Mortgage
		Securities, Inc.,
		Series 2004-1, Class AF2,
		2.645%, 04/25/2034		248,784
		Countrywide Asset-Backed
		Certificates:
	1,483,070	Series 2006-S7, Class A2,
		5.571%, 11/25/2035		340,001
	231,350	Series 2005-12, Class 1A2,
		4.847%, 02/25/2036		229,818
	572,948	Series 2005-13, Class AF2,
		5.294%, 04/25/2036		561,863
	2,000,000	Series 2006-13, Class 1AF2,
		5.884%, 01/25/2037		1,584,570
	2,495,000	Series 2006-13, Class
		1AF3, 5.944%,
		01/25/2037		1,080,559
	1,500,000	Series 2006-9, Class 1AF3,
		5.859%, 10/25/2046		462,644
	830,557	Credit Based Asset
		Servicing and Securities,
		Series 2005-CB8, Class
		AF2, 5.303%, 12/25/2035		737,600
	1,225,000	Discover Card
		Master Trust I,
		Series 2005-2, Class A,
		4.266%, 04/17/2012		1,222,934
	3,020,096	GMAC Mortgage
		Corporation Loan Trust,
		Series 2005-HE3, Class
		A2, 3.526%, 02/25/2036		981,541
		Green Tree Financial
		Corporation:
	125,415	Series 1996-3, Class A5,
		7.35%, 05/15/2027		117,979
	55,541	Series 1998-2, Class A5,
		6.24%, 12/01/2028		48,407
	1,881,345	Series 1997-5, Class A6,
		6.82%, 05/15/2029		1,752,206
	619,923	Series 1998-3, Class A5,
		6.22%, 03/01/2030		497,339
	2,000,000	Renaissance Home
		Equity Loan Trust,
		Series 2007-2, Class AF2,
		5.675%, 06/25/2037		886,966
	325,411	Residential Asset
		Mortgage Products, Inc.,
		Series 2003-RS7, Class
		AI6, 5.34%, 08/25/2033		254,790
				14,520,188

The accompanying notes are an integral part of these financial statements.

Page 3

Baird Short-Term Bond Fund

Schedule of Investments       June 30, 2009 (Unaudited)

Principal
Amount			Value
LONG-TERM INVESTMENTS – 95.4% (cont.)
Financial – 25.4%
$	1,000,000	Allstate Corporation
		Senior Notes,
		6.20%, 05/16/2014	$	1,048,869
	2,330,000	American Express
		Centurion,
		0.45%, 07/13/2010		2,267,141
		American General Finance
		Corporation Notes:
	1,099,000	8.45%, 10/15/2009		1,056,786
	1,000,000	4.00%, 03/15/2011		662,646
	1,000,000	Ameriprise Financial, Inc.,
		5.35%, 11/15/2010		998,162
	1,130,000	Associates Corporation
		North America
		Subordinated Debentures,
		8.15%, 08/01/2009		1,130,810
	1,460,000	Axa Financial, Inc.,
		7.75%, 08/01/2010		1,464,016
	1,000,000	Bancwest Corporation
		Subordinated Notes,
		8.30%, 01/15/2011		1,031,877
		Bank of Ireland: f
	500,000	2.863%, 12/18/2009		495,362
	1,000,000	1.171%, 01/15/2010		986,063
	1,000,000	Bank of Scotland PLC,
		1.344%, 12/08/2010
		(Acquired 05/14/2009;
		Cost $935,224) * f		952,535
	225,000	Bank One Corporation
		Subordinated Notes,
		10.00%, 08/15/2010		239,280
		Bank Tokyo – Mitsubishi
		UFJ Ltd.: f
	250,000	8.40%, 04/15/2010		258,051
	1,700,000	7.40%, 06/15/2011		1,749,201
	251,000	Bank United Notes,
		8.00%, 03/15/2009 @		125
	600,000	Barclays Bank PLC
		Senior Unsecured Notes,
		5.45%, 09/12/2012 f		625,565
	2,750,000	Barclays Bank PLC
		Subordinated Notes,
		7.40%, 12/15/2009 f		2,799,976
	1,000,000	Bear Stearns Cos., Inc.,
		7.625%, 12/07/2009		1,025,326
	500,000	Charles Schwab
		Corporation Senior Notes,
		8.05%, 03/01/2010		515,934
		Cit Group, Inc.
		Senior Notes:
	2,000,000	4.25%, 02/01/2010		1,795,576
	700,000	4.75%, 12/15/2010		549,506
		Citigroup, Inc.:
	100,000	7.25%, 10/31/2010		99,589
	200,000	6.50%, 01/18/2011		203,093
	723,000	5.125%, 02/14/2011		720,939
	850,000	Compass Bank
		Subordinated Notes,
		8.10%, 08/15/2009		849,327
	388,000	Corestates Capital Trust I,
		8.00%, 12/15/2026
		(Acquired 01/26/2006
		and 05/31/2006;
		Cost $205,803 and
		$193,454, respectively) *		254,113
	1,000,000	Countrywide Home
		Loans Notes,
		4.125%, 09/15/2009		1,003,260
	497,000	Deutsche Bank Trust
		Corporation Subordinated
		Notes, 7.25%, 10/15/2011		524,039

The accompanying notes are an integral part of these financial statements.

Page 4

Baird Short-Term Bond Fund

Schedule of Investments       June 30, 2009 (Unaudited)

Principal
Amount			Value
LONG-TERM INVESTMENTS – 95.4% (cont.)
Financial – 25.4% (cont.)
		Export-Import Bank
		Korea Notes: f
$	350,000	4.625%, 03/16/2010	$	351,414
	815,000	5.125%, 02/14/2011		825,654
	2,190,000	Fifth Third Bank,
		4.20%, 02/23/2010		2,188,397
	1,000,000	First Empire
		Capital Trust I,
		8.234%, 02/01/2027
		(Callable 08/24/2009)		659,414
	1,500,000	First Hawaiian Capital
		Trust I, Series B,
		8.343%, 07/01/2027		1,145,937
	1,500,000	First National Bank of
		Omaha Subordinated Notes,
		7.32%, 12/01/2010		1,472,728
	800,000	First Union Capital I,
		Series A, 7.935%,
		01/15/2027 (Callable
		08/24/2009)		724,694
	2,000,000	GE Global Insurance
		Holding Corp.,
		7.50%, 06/15/2010		1,995,574
	250,000	General Electric Capital
		Corporation Senior
		Unsecured Notes,
		6.00%, 06/15/2012		262,798
	250,000	Genworth Global
		Funding Trust,
		5.125%, 03/15/2011		241,297
	787,000	GMAC LLC,
		7.50%, 12/31/2013
		(Acquired 09/08/2006
		and 08/21/2007; Cost
		$585,844 and $402,679,
		respectively) *		609,925
		Goldman Sachs
		Group, Inc.:
	273,000	7.80%, 01/28/2010		282,434
	1,440,000	6.875%, 01/15/2011		1,522,380
	1,000,000	Goldman Sachs Group LP
		Senior Unsecured Notes,
		8.00%, 03/01/2013
		(Acquired 04/16/2009;
		Cost $1,025,738) *		1,083,048
	770,000	Hartford Life
		Global Funding,
		2.111%, 09/15/2009		766,871
	1,000,000	HSBC Finance Corporation
		Senior Unsecured Notes,
		1.411%, 03/12/2010		983,564
	1,500,000	HSBC USA Capital Trust II,
		8.38%, 05/15/2027
		(Callable 08/24/2009)
		(Acquired 11/06/2007;
		Cost $1,551,337) *		1,358,826
	1,300,000	Huntington National Bank
		Notes, 8.00%, 04/01/2010		1,300,267
	1,000,000	ING Bank Notes,
		1.569%, 08/24/2009
		(Acquired 04/23/2009;
		Cost $997,744) * f		1,000,507
	2,000,000	ING SEC Life
		Institutional Fund Senior
		Unsecured Notes,
		1.321%, 01/15/2010		2,002,158
	1,000,000	ING USA Global
		Funding Notes,
		1.358%, 10/01/2010		967,486
		Invesco Ltd.: f
	1,515,000	5.625%, 04/17/2012		1,395,218
	325,000	5.375%, 02/27/2013		284,169

The accompanying notes are an integral part of these financial statements.

Page 5

Baird Short-Term Bond Fund

Schedule of Investments       June 30, 2009 (Unaudited)

Principal
Amount			Value
LONG-TERM INVESTMENTS – 95.4% (cont.)
Financial – 25.4% (cont.)
$	500,000	J.P. Morgan Chase & Co.
		Senior Unsecured Notes,
		4.65%, 06/01/2014	$	498,681
	2,180,000	John Hancock Global
		Funding II, 7.90%,
		07/02/2010 (Acquired
		02/24/2009 and
		03/24/2009; Cost
		$2,057,133 and $177,142,
		respectively) *		2,235,267
	2,000,000	Kookmin Bank,
		7.25%, 05/14/2014
		(Acquired 05/26/2009;
		Cost $2,077,091) * f		2,064,894
	625,000	Korea Development Bank
		Senior Unsecured Notes:
		4.625%, 09/16/2010 f		630,053
	2,500,000	M&I Marshall & Ilsley
		Bank, 2.93%, 06/16/2010		2,402,488
	2,671,000	MBNA Capital, Series A,
		8.278%, 12/01/2026
		(Callable 08/24/2009)		2,250,318
	1,067,000	Mercantile Bankshares
		Corporation Subordinated
		Notes, Series B,
		4.625%, 04/15/2013		962,398
	1,500,000	Merrill Lynch & Co.,
		4.966%, 05/12/2010		1,491,560
	2,000,000	Monumental Global
		Funding II, 4.375%,
		07/30/2009 (Acquired
		12/15/2008 and
		02/23/2009; Cost
		$996,622 and $997,929,
		respectively) *		1,999,950
	1,020,000	The Mony Group, Inc.,
		8.35%, 03/15/2010		1,053,657
		Morgan Stanley:
	2,636,000	8.00%, 06/15/2010		2,706,516
	355,000	6.60%, 04/01/2012		375,858
	2,560,000	National Australia Bank
		Ltd. Subordinated Notes,
		Series A, 8.60%,
		05/19/2010 f		2,702,720
	1,730,000	National Westminster Bank
		Subordinated Notes,
		7.375%, 10/01/2009 f		1,711,134
	1,300,000	Nationwide Life Global
		Funding, 5.35%,
		03/15/2011 (Acquired
		03/24/2009; Cost
		$1,191,618)*		1,283,598
	2,273,000	NB Capital Trust IV,
		8.25%, 04/15/2027
		(Callable 08/24/2009)		1,908,620
	1,000,000	North Fork Capital
		Trust II,
		8.00%, 12/15/2027
		(Callable 08/24/2009)		725,927
	1,500,000	Northern Rock PLC,
		4.583%, 10/20/2009
		(Acquired 01/07/2009;
		Cost $1,470,166) * f		1,491,855
	1,000,000	PNC Funding
		Corporation,
		7.50%, 11/01/2009		1,013,742
	2,000,000	Pooled Funding Trust II,
		2.625%, 03/30/2012
		(Acquired 03/27/2009;
		Cost $1,998,800) *		2,003,150

The accompanying notes are an integral part of these financial statements.

Page 6

Baird Short-Term Bond Fund

Schedule of Investments       June 30, 2009 (Unaudited)

Principal
Amount			Value
LONG-TERM INVESTMENTS – 95.4% (cont.)
Financial – 25.4% (cont.)
		Pricoa Global Funding I:
$	250,000	2.046%, 12/15/2009
		(Acquired 02/06/2009;
		Cost $244,855) *	$	248,617
	475,000	1.341%, 01/15/2010
		(Acquired 06/23/2009;
		Cost $464,340) *		471,841
	2,010,000	4.20%, 01/15/2010
		(Acquired 03/05/2009
		and 04/02/2009;
		Cost $1,082,698 and
		$871,807, respectively) *		1,969,422
	1,800,000	Principal Financial Group
		(AU) Senior Notes,
		8.20%, 08/15/2009
		(Acquired 05/14/2008
		and 11/28/2008; Cost
		$502,353 and $1,301,145,
		respectively) * f		1,807,360
	2,000,000	Protective Life Secured
		Trust, 4.00%, 04/01/2011		1,975,616
	1,000,000	Rabobank Nederland
		Global Senior Unsecured
		Notes, 4.20%, 05/13/2014
		(Acquired 05/06/2009;
		Cost $998,170) * f		997,435
	1,130,000	Santander Central
		Hispano Issuances,
		7.625%, 11/03/2009 f		1,146,646
	550,000	Santander Financial
		Issuances,
		6.375%, 02/15/2011 f		548,849
	1,724,000	Sovereign Bancorp, Inc.,
		4.80%, 09/01/2010		1,683,995
	2,000,000	Sun Life Financial Global
		Funding, 1.663%,
		07/06/2010 (Acquired
		01/30/2009 and
		02/17/2009; Cost
		$965,828 and $954,384,
		respectively) *		1,941,028
	825,000	Toll Road Inv. Part II,
		Series 1999B, 0.00%,
		02/15/2010 (Acquired
		03/10/2009;
		Cost $795,742) * ^		793,181
		Union Planters
		Corporation Notes:
	750,000	4.375%, 12/01/2010		726,776
	1,075,000	7.75%, 03/01/2011		1,043,412
				95,598,491
Industrial – 19.0%
	2,000,000	Alcoa, Inc.,
		6.50%, 06/01/2011		2,038,950
	1,112,000	Allied Waste North
		America Inc. Senior
		Unsecured Notes,
		6.50%, 11/15/2010		1,131,460
	1,000,000	AOL Time Warner, Inc.,
		6.75%, 04/15/2011		1,046,571
	2,605,000	British Sky
		Broadcasting PLC,
		8.20%, 07/15/2009 f		2,606,537
	2,225,000	British Telecom PLC Notes,
		8.625%, 12/15/2010 f		2,363,110
	1,825,000	CBS Corporation,
		7.70%, 07/30/2010		1,879,093
	500,000	Clear Channel
		Communications Senior
		Notes, 7.65%, 09/15/2010		295,000

The accompanying notes are an integral part of these financial statements.

Page 7

Baird Short-Term Bond Fund

Schedule of Investments       June 30, 2009 (Unaudited)

Principal
Amount			Value
LONG-TERM INVESTMENTS – 95.4% (cont.)
Industrial – 19.0% (cont.)
$	1,660,000	Comcast Holdings
		Corporation,
		10.625%, 07/15/2012	$	1,942,200
	2,000,000	Computer Associates,
		Inc., 4.75%, 12/01/2009		2,007,240
	725,000	Computer Sciences
		Corporation Senior Notes,
		7.375%, 06/15/2011		770,446
	2,000,000	Conagra Foods, Inc.,
		6.75%, 09/15/2011		2,138,786
	2,581,000	COX Communications
		Inc. Notes,
		7.875%, 08/15/2009		2,596,463
	1,250,000	CVS Caremark
		Corporation Senior
		Unsecured Notes,
		1.561%, 06/01/2010
		(Callable 08/24/2009)		1,241,136
	2,875,000	Deutsche Telekom
		International Finance BV,
		8.50%, 06/15/2010 f		3,023,537
	662,000	Devon Energy
		Corporation Debentures,
		10.125%, 11/15/2009		672,753
	2,000,000	Donnelley (R.R.) & Sons
		Co. Senior Unsecured
		Notes, 4.95%, 05/15/2010		2,002,734
	500,000	Fiserv, Inc.,
		6.125%, 11/20/2012		518,998
	1,660,000	France Telecom S.A.,
		7.75%, 03/01/2011 f		1,795,343
	2,000,000	General Electric Company,
		5.00%, 02/01/2013		2,081,032
	2,250,000	Health Care Service
		Corporation Senior
		Unsecured Notes, 7.75%,
		06/15/2011 (Acquired
		06/15/2009 and 06/17/2009;
		Cost $2,139,740 and
		$265,438, respectively) *		2,355,151
	1,500,000	Historic Time
		Warner Inc.,
		9.125%, 01/15/2013		1,651,503
	2,000,000	Home Depot, Inc.,
		3.75%, 09/15/2009		2,005,024
	625,000	IBM Corporation Senior
		Unsecured Notes,
		7.50%, 06/15/2013		711,466
	675,000	International Paper
		Company Notes,
		4.00%, 04/01/2010		676,608
	595,000	Johnson Controls Inc.
		Senior Unsecured Notes,
		5.25%, 01/15/2011		601,452
	1,625,000	Kinder Morgan Energy
		Partners Senior Unsecured
		Notes, 6.75%, 03/15/2011		1,703,128
	2,000,000	Koninslijke KPN NV
		Senior Unsecured Notes,
		8.00%, 10/01/2010 f		2,098,554
	200,000	Kraft Foods Inc. Senior
		Unsecured Notes,
		5.625%, 11/01/2011		212,495
	2,660,000	Motiva Enterprises LLC
		Senior Unsecured Notes,
		5.20%, 09/15/2012
		(Acquired 05/13/2009 and
		06/11/2009; Cost
		$2,212,277 and $455,943,
		respectively) *		2,730,149

The accompanying notes are an integral part of these financial statements.

Page 8

Baird Short-Term Bond Fund

Schedule of Investments       June 30, 2009 (Unaudited)

Principal
Amount			Value
LONG-TERM INVESTMENTS – 95.4% (cont.)
Industrial – 19.0% (cont.)
$	1,000,000	New Cingular Wireless
		Service, Inc. Senior
		Unsecured Notes,
		7.875%, 03/01/2011	$	1,078,465
	1,000,000	New York
		Telephone Company,
		6.125%, 01/15/2010		1,016,825
	1,000,000	News America Inc.,
		4.75%, 03/15/2010		1,010,283
	2,400,000	PEMEX Project
		Funding Master Trust,
		9.125%, 10/13/2010		2,589,120
	2,000,000	Posco,
		8.75%, 03/26/2014
		(Acquired 03/19/2009;
		Cost $1,984,160) * f		2,211,046
	700,000	Reed Elsevier Capital Inc.,
		4.821%, 06/15/2010		671,250
	2,000,000	Rio Tinto Alcan, Inc.,
		5.75%, 06/01/2035		2,072,300
		Telecom Italia Capital: f
	1,250,000	4.00%, 01/15/2010		1,255,992
	120,000	5.25%, 11/15/2013		117,671
	375,000	Thomson Reuters
		Corporation,
		6.20%, 01/05/2012 f		390,601
	475,000	Tyco International Finance,
		6.375%, 10/15/2011 f		500,523
	21,165	United AirLines, Inc.
		Pass-Thru Certificates,
		Series 2001-1, Class A-2,
		6.201%, 12/31/2049		20,953
		Unitedhealth Group, Inc.:
	325,000	4.125%, 08/15/2009		325,485
	1,000,000	1.705%, 06/21/2010
		(Callable 09/21/2009)		990,562
	1,500,000	Verizon Communications,
		7.25%, 12/01/2010		1,597,113
	600,000	Verizon New Jersey,
		Inc., Series A,
		5.875%, 01/17/2012		628,962
		Vodafone Group PLC: f
	1,105,000	7.75%, 02/15/2010		1,142,360
	1,000,000	5.50%, 06/15/2011		1,052,194
	910,000	Waste Management, Inc.,
		7.65%, 03/15/2011		929,523
		Wellpoint, Inc.:
	1,700,000	4.25%, 12/15/2009		1,720,198
	300,000	6.80%, 08/01/2012		313,101
	2,000,000	Weyerhaeuser Company,
		5.25%, 12/15/2009		2,010,160
	1,000,000	Wyeth,
		6.95%, 03/15/2011		1,082,688
				71,624,294
Mortgage Backed Securities – 13.4%
	702,001	Bank of America
		Alternative Loan Trust,
		Series 2003-4, Class 2A1,
		5.00%, 06/25/2018		691,252
	421,801	Chase Commercial Mortgage
		Securities Corporation,
		Series 1999-2, Class A2,
		7.198%, 01/15/2032		423,896
		Citicorp Mortgage
		Securities, Inc.:
	602,837	Series 2004-3, Class A2,
		5.25%, 05/25/2034		605,725
	351,253	Series 2004-4, Class A2,
		5.25%, 06/25/2034		348,184
		Countrywide Alternative
		Loan Trust:
	1,016,552	Series 2005-50CB, Class
		4A1, 5.00%, 11/25/2020		796,664

The accompanying notes are an integral part of these financial statements.

Page 9

Baird Short-Term Bond Fund

Schedule of Investments       June 30, 2009 (Unaudited)

Principal
Amount			Value
LONG-TERM INVESTMENTS – 95.4% (cont.)
Mortgage Backed Securities – 13.4% (cont.)
$	2,622,334	Series 2005-34CB, Class
		1A6, 5.50%, 09/25/2035	$	2,188,685
	659,651	Series 2005-73CB, Class
		1A7, 5.50%, 01/25/2036		486,539
	2,701,049	Series 2006-28CB, Class
		A17, 6.00%, 10/25/2036		1,808,686
		Deutsche Alternative
		Securities Inc. Mortgage:
	258,094	Series 2003-3, Class 2A5,
		5.00%, 10/25/2033		249,483
	946,179	Series 2005-4, Class A2,
		5.05%, 09/25/2035		894,482
	528,942	DLJ Commercial
		Mortgage Corporation,
		Series 1999-CG3, Class
		A1B, 7.34%, 10/10/2032		528,361
	2,717,920	Federal Home Loan Bank,
		Series 00-0582, Class H,
		4.75%, 10/25/2010		2,802,855
		Federal Home Loan
		Mortgage Corporation
		(FHLMC):
	16,816	Series 2548, Class HA,
		4.50%, 01/15/2010		16,868
	1,095,512	Series 2672, Class QR,
		4.00%, 09/15/2010		1,132,167
	406,012	Series 2835, Class VK,
		5.50%, 11/15/2012		412,524
	374,280	Series R015, Class AN,
		3.75%, 02/15/2013		379,308
	645,250	Series 3033, Class LU,
		5.50%, 03/15/2013		680,045
	1,920,928	Series 3124, Class VP,
		6.00%, 06/15/2014		2,047,874
	1,920,587	Series R014, Class AL,
		5.50%, 10/15/2014		1,960,563
	1,297,416	Series R001, Class AE,
		4.375%, 04/15/2015		1,331,746
	242,633	Series 2789, Class VM,
		5.50%, 04/15/2015		253,866
	93,550	Series 2390, Class PW,
		6.00%, 04/15/2015		93,657
	1,298,645	Series 2857, Class VA,
		5.00%, 09/15/2015		1,378,302
	81,853	Series 2541, Class JB,
		5.00%, 02/15/2016		83,257
	5,595,075	Series R007, Class AC,
		5.875%, 05/15/2016		5,741,432
	893,910	Series 2910, Class BD,
		4.50%, 11/15/2018		929,648
	36,730	Series 5, Class B,
		1.08%, 05/15/2019		35,796
	376,077	Series 2970, Class DA,
		5.50%, 01/15/2023		390,246
		Federal National Mortgage
		Association (FNMA):
	385,955	5.50%, 07/01/2015		403,136
	411,477	Series 2003-27, Class OJ,
		5.00%, 07/25/2015		416,883
	1,594,072	Series 2002-74, Class TD,
		5.00%, 12/25/2015		1,613,208
	549,540	Series 2003-24, Class LC,
		5.00%, 12/25/2015		559,910
	537,637	Series 2006-B1 – Class AB,
		6.00%, 06/25/2016		558,637
	3,194,096	Series 2004-W6, Class 1A4,
		5.50%, 07/25/2034		2,990,345
	1,283,872	Series 2004-W6, Class 1A6,
		5.50%, 07/25/2034		1,341,245
	3,463,548	Series 2004-W10, Class
		A24, 5.00%, 08/25/2034		3,433,134

The accompanying notes are an integral part of these financial statements.

Page 10

Baird Short-Term Bond Fund

Schedule of Investments       June 30, 2009 (Unaudited)

Principal
Amount			Value
LONG-TERM INVESTMENTS – 95.4% (cont.)
Mortgage Backed Securities – 13.4% (cont.)
$	1,605,528	GMAC Commercial
		Mortgage Securities Inc,
		Series 2001-C1, Class A2,
		6.465%, 04/15/2034	$	1,632,304
	1,379,193	J.P. Morgan Alternative
		Loan Trust,
		Series 2006-S2, Class A2,
		5.81%, 05/25/2036		1,185,643
	465,381	Merrill Lynch Mortgage
		Investors Inc.,
		Series 2005-A8, Class
		A1C1, 5.25%, 08/25/2036		407,452
	556,009	Residential Accredit Loans
		Inc., Series 2003-QS17,
		Class CB3, 5.50%,
		09/25/2033		528,720
		Salomon Brothers Mortgage
		Securities VII:
	1,853,734	Series 2000-C1, Class A2,
		7.52%, 12/18/2009		1,865,091
	959,357	Series 2000-C2, Class A2,
		7.455%, 07/18/2033		973,435
	2,744,001	Series 2001-C2, Class A3,
		6.50%, 11/13/2036		2,816,294
		Washington Mutual, Inc.
		Pass-Thru Certificates:
	476,255	Series 2004-CB4, Class
		21A, 5.50%, 12/25/2019		424,426
	441,912	Series 2004-CB4, Class
		22A, 6.00%, 12/25/2019		398,846
				50,240,820
Taxable Municipal Bonds – 1.0%
	388,945	Educational Enhancement
		Funding Corporation,
		6.72%, 06/01/2025		340,961
	370,000	Missouri State
		Housing Development
		Revenue Bond,
		5.74%, 03/01/2037		369,512
	1,750,000	Pennsylvania State
		Turnpike Commission,
		5.29%, 10/15/2009		1,753,360
	680,000	Pomona California
		Public Financing Authority
		Lease Revenue,
		4.60%, 10/01/2010		680,551
	265,000	Redding California
		Redevelopment Agency
		Tax Allocation,
		6.00%, 09/01/2010		267,528
	255,000	Richmond Joint Powers
		Financing Authority
		Tax Allocation,
		7.35%, 09/01/2010		258,381
	144,792	Tobacco Settlement
		Financing Corporation,
		Series 2001-A, Class A,
		6.36%, 05/15/2025		133,335
				3,803,628
Utilities – 8.2%
	2,000,000	Allegheny Energy Supply
		Co. Senior Unsecured Notes,
		7.80%, 03/15/2011		2,069,146
	600,000	Baltimore Gas & Electric
		Co. Senior Unsecured Notes,
		6.125%, 07/01/2013		626,141
	940,000	Cilcorp Inc. Senior Notes,
		8.70%, 10/15/2009		921,200
	474,000	Commonwealth Edison
		Co., Series 98,
		6.15%, 03/15/2012		503,187

The accompanying notes are an integral part of these financial statements.

Page 11

Baird Short-Term Bond Fund

Schedule of Investments       June 30, 2009 (Unaudited)

Principal
Amount			Value
LONG-TERM INVESTMENTS – 95.4% (cont.)
Utilities – 8.2% (cont.)
$	2,000,000	Constellation Energy
		Group Inc. Senior Notes,
		6.125%, 09/01/2009	$	2,008,622
	500,000	Duke Energy Corp.,
		6.30%, 02/01/2014		539,819
	1,000,000	Energy Transfer Partners
		L.P., 9.70%, 03/15/2019		1,148,045
	2,000,000	Exelon Corporation,
		6.75%, 05/01/2011		2,087,532
	1,733,519	GG1C Funding
		Corporation Secured Notes,
		5.129%, 01/15/2014
		(Callable 08/24/2009)
		(Acquired 04/02/2009;
		Cost $1,645,672) *		1,595,444
		NiSource Finance
		Corporation:
	550,000	2.915%, 11/23/2009
		(Callable 08/24/2009)		545,632
	2,000,000	7.875%, 11/15/2010		2,065,778
	1,500,000	Northern Border Pipeline
		Co., 7.75%, 09/01/2009		1,512,728
	1,000,000	Pacific Gas & Electric
		Company Senior
		Unsecured Notes,
		1.598%, 06/10/2010		1,004,938
	1,670,000	Pepco Holdings, Inc.
		Senior Notes,
		2.83%, 06/01/2010
		(Callable 08/24/2009)		1,637,756
	2,000,000	PPL Energy Supply,
		LLC Senior Notes,
		6.40%, 11/01/2011		2,106,492
	1,000,000	PSEG Power LLC,
		6.95%, 06/01/2012		1,076,573
	2,300,000	Rockies Express Pipeline
		LLC, 5.776%, 08/20/2009
		(Acquired 02/25/2009
		and 04/01/2009; Cost
		$1,994,704 and $300,106,
		respectively) *		2,300,219
	1,969,000	Sempra Energy,
		7.95%, 03/01/2010		2,039,642
	2,500,000	Spectra Energy Capital
		Senior Unsecured Notes,
		7.50%, 10/01/2009		2,528,257
		Williams Companies, Inc.
		Senior Unsecured Notes:
	1,400,000	6.375%, 10/01/2010
		(Acquired 07/09/2008;
		Cost $1,307,647) *		1,399,727
	1,000,000	8.125%, 03/15/2012		1,036,350
				30,753,228
U.S. Government Agency Issues – 14.4%
	2,000,000	Federal Home Loan Bank,
		1.625%, 07/27/2011		2,011,004
	5,000,000	Federal Farm Credit Bank,
		2.125%, 06/18/2012		5,016,440
		Federal National Mortgage
		Association (FNMA):
	10,500,000	3.625%, 02/12/2013		11,039,983
	13,150,000	4.375%, 03/15/2013		14,141,405
	21,750,000	2.75%, 03/13/2014		21,703,455
				53,912,287
U.S. Treasury Obligations – 10.1%
	36,500,000	U.S. Treasury Bond,
		3.125%, 08/31/2013		37,814,584
		Total Long-Term
		Investments
		(Cost $367,179,688)		358,267,520

The accompanying notes are an integral part of these financial statements.

Page 12

Baird Short-Term Bond Fund

Schedule of Investments       June 30, 2009 (Unaudited)

Shares			Value
SHORT-TERM INVESTMENTS – 6.5%
Money Market Fund – 6.5%
	24,410,330	Short-Term Investment
		Company Liquid Assets
		Portfolio – AIM Fund	$	24,410,330
		Total Short-Term
		Investments
		(Cost $24,410,330)		24,410,330
Principal
Amount
INVESTMENTS PURCHASED
WITH CASH PROCEEDS FROM
SECURITIES LENDING – 25.9%
Commercial Paper – 0.4%
$	1,301,909	Atlantic East Funding LLC,
		3.059%, 03/25/10 # **		1,301,909
				1,301,909
Corporate Bond – 0.4%
	1,598,900	Svenska Handelsbanken,
		4.418%, 08/06/09 f		1,598,900
				1,598,900
Shares
Investment Companies – 25.1%
	94,149,265	Mount Vernon
		Securities Lending
		Trust Prime Portfolio		94,149,265
	71,456	Reserve Primary Fund # **		71,456
				94,220,721
		Total Investments
		Purchased With Cash
		Proceeds From
		Securities Lending
		(Cost $97,121,530)		97,121,530
		Total Investments
		(Cost $488,711,548) –
		127.8%		479,799,380
		Liabilities in Excess of
		Other Assets – (27.8)%		(104,210,995	)
		TOTAL NET
		ASSETS – 100.0%	$	375,588,385

* Restricted Security Deemed Liquid

** Illiquid Security

f Foreign Security

^ Non-Income Producing

# Priced at Fair Value by the Valuation Committee as delegated by the Baird Funds’ Board of Directors

@ Security in default

The accompanying notes are an integral part of these financial statements.

Page 13

Baird Short-Term Bond Fund

Schedule of Investments       June 30, 2009 (Unaudited)

SFAS 157 – Summary of Fair Value Exposure at June 30, 2009

As adopted by the Fund, the Financial Accounting Standards Board issued Statement of Financial Accounting Standards No. 157, “Fair Value Measurements” (“SFAS 157”) defines fair value, establishes a framework for measuring fair value in generally accepted accounting principles (GAAP), and expands disclosures about fair value measurements.  Under SFAS 157, various inputs are used in determining the value of the Fund’s investments.  These inputs are summarized into three broad levels and described below:

Level 1 –	Quoted prices in active markets for identical securities.
Level 2 –	Other significant observable inputs (including quoted prices for similar securities, quoted prices for identical securities in inactive markets, dealer indications, interest rates, yield curves, benchmark yields, issuer spreads, prepayment speeds, cash flows, credit risk, default rates, information about issuers, sectors and markets, inputs corroborated by observable market data, etc.)
Level 3 –	Significant unobservable inputs (including the Fund’s own assumptions about the assumptions that market participants would use in pricing the security).

The inputs or methodology used for valuing securities are not necessarily an indication of the risk associated with investing in those securities.

The following is a summary of the inputs used to value the Fund’s investments as of June 30, 2009:

	Level 1		Level 2		Level 3		Total
Fixed Income
Asset Backed Securities	$	—	$	14,520,188	$	—	$	14,520,188
Corporate Debt Securities		—		197,976,013		—		197,976,013
Mortgage Backed Securities		—		50,240,820		—		50,240,820
Taxable Municipal Bonds		—		3,803,628		—		3,803,628
U.S. Government Agency Issues		—		53,912,287		—		53,912,287
U.S. Treasury Obligations		—		37,814,584		—		37,814,584
Total Fixed Income		—		358,267,520		—		358,267,520
Short-Term Investments
Money Market Mutual Funds		24,410,330		—		—		24,410,330
Total Short-Term Investments		24,410,330		—		—		24,410,330
Investments Purchased With Cash
Proceeds From Securities Lending
Commercial Paper		—		1,301,909		—		1,301,909
Corporate Bonds		—		1,598,900		—		1,598,900
Money Market Mutual Funds		94,149,265		—		71,456		94,220,721
Total Investments Purchased With Cash
Proceeds From Securities Lending		94,149,265		2,900,809		71,456		97,121,530
Total Investments in Securities	$	118,559,595	$	361,168,329	$	71,456	$	479,799,380

Page 14

Baird Short-Term Bond Fund

Schedule of Investments       June 30, 2009 (Unaudited)

Level 3 Reconciliation Disclosure

Following is a reconciliation of Level 3 assets for which significant unobservable inputs were used to determine fair value.

Description	Investments in Securities
Balance as of December 31, 2008	$	725,642
Accrued discounts/premiums		—
Realized gain (loss)		—
Change in unrealized appreciation (depreciation)		—
Net purchases (sales/paydowns)		(80,022	)
Transfers in and/or out of Level 3 *		(574,164	)
Balance as of June 30, 2009	$	71,456
Change in unrealized appreciation (depreciation) during
the year for level 3 investments held at June 30, 2009.		—

* The information used in the above reconciliation represents fiscal year to date activity for any investments identified as using Level 3 inputs at either the beginning or end of the current fiscal period.  Transfers in or out of Level 3 represents either the beginning value (for transfers in) or ending value (for transfers out) of any security or instrument where a change in the pricing level occurred from the beginning to the end of the period.

Page 15

Baird Intermediate Bond Fund

June 30, 2009

The Baird Intermediate Bond Fund seeks an annual rate of total return, before Fund expenses, greater than the annual rate of total return of the Barclays Capital Intermediate U.S. Government/Credit Bond Index.  The Barclays Capital Intermediate U.S. Government/Credit Bond Index is an unmanaged, market value weighted index of investment grade, fixed-rate debt issues, including government and corporate securities, with maturities between one and ten years.

Portfolio Characteristics

Quality Distribution*	Sector Weightings*

Net Assets:	$464,014,957	Annualized Expense Ratio:
SEC 30-Day Yield:**		Institutional Class:	0.30	%
Institutional Class:	5.20%	Investor Class:	0.55	%***
Investor Class:	4.94%	Portfolio Turnover Rate:	16.7	%#
Average Effective Duration:	3.87 years	Total Number of Holdings:	305
Average Effective Maturity:	5.07 years

* Percentages shown are based on the Fund’s total net assets.

** SEC yields are based on SEC guidelines and are calculated for the 30 days ended June 30, 2009.

*** Includes 0.25% 12b-1 fee.

# Not annualized.

Page 16

Baird Intermediate Bond Fund

Average Annual Total Returns

			Since
For the Periods Ended June 30, 2009	One Year	Five Years	Inception(1)
Institutional Class Shares	3.97%	4.15%	5.50%
Investor Class Shares	3.59%	3.85%	5.22%
Barclays Capital Intermediate U.S. Government/Credit Bond Index(2)	5.27%	4.57%	5.65%

(1) For the period from September 29, 2000 (commencement of operations) through June 30, 2009.

(2) The Barclays Capital Intermediate U.S. Government/Credit Bond Index is an unmanaged, market value weighted index of investment grade, fixed-rate debt including government and corporate securities with maturities between one and 10 years.  This index does not reflect any deduction for fees, expenses or taxes.  A direct investment in an index is not possible.

The returns shown in the table above reflect reinvestment of dividends and/or capital gains distributions in additional shares.  The returns do not reflect the deduction of taxes that a shareholder would pay on Fund distributions or the redemption of Fund shares.

Past performance does not guarantee future results.  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.

For information about the performance of the Fund as of the most recent month-end, please call 1-866-44BAIRD or visit www.bairdfunds.com.  Mutual fund performance changes over time and current performance may be lower or higher than that stated.

Page 17

Baird Intermediate Bond Fund

Schedule of Investments       June 30, 2009 (Unaudited)

Principal
Amount			Value
LONG-TERM INVESTMENTS – 97.1%
Asset Backed Securities – 2.4%
$	925,000	American Express Credit
		Account Master Trust,
		Series 2005-5, Class A,
		4.276%, 02/15/2013	$	917,005
	158,057	Amresco Residential
		Securities Mortgage
		Loan Trust,
		Series 1998-1, Class A6,
		6.51%, 08/25/2027		135,954
	750,000	Chase Issuance Trust,
		Series 2005-A10, Class
		A10, 4.65%, 12/17/2012		774,475
	671,304	CitiFinancial Mortgage
		Securities, Inc.,
		Series 2004-1, Class AF2,
		2.645%, 04/25/2034		633,214
	8,102	Cityscape Home
		Equity Loan Trust,
		1997-C, Class A4,
		7.00%, 07/25/2028		7,959
		Countrywide Asset-Backed
		Certificates:
	2,134,729	Series 2006-S3, Class A2,
		6.085%, 06/25/2021		616,468
	146,518	Series 2006-S2, Class A2,
		5.627%, 07/25/2027		103,253
	120,640	Series 2004-12, Class AF6,
		4.634%, 03/25/2035		73,776
	441,431	Series 2005-12, Class 1A2,
		4.847%, 02/25/2036		438,507
	4,000,000	Series 2006-13, Class 1AF2,
		5.884%, 01/25/2037		3,169,139
	375,000	Series 2006-13, Class 1AF3,
		5.944%, 01/25/2037		162,409
	1,380,000	Series 2006-9, Class 1AF3,
		5.859%, 10/25/2046		425,633
		Delta Funding Home
		Equity Loan Trust:
	69,820	Series 1997-2, Class A6,
		7.04%, 06/25/2027		69,642
	38,785	Series 1999-1, Class A6F,
		6.34%, 12/15/2028		37,339
	538,268	Series 1999-2, Class A7F,
		7.03%, 08/15/2030		399,043
	175,000	Discover Card
		Master Trust I,
		Series 2005-2, Class A,
		4.266%, 04/17/2012		174,705
	29,302	Equivantage Home
		Equity Loan Trust,
		Series 1996-3, Class A3,
		7.70%, 09/25/2027		23,506
		GMAC Mortgage
		Corporation Loan Trust:
	151,177	Series 2004-GH1, Class A2,
		4.39%, 12/25/2025		143,757
	215,721	Series 2005-HE3, Class A2,
		3.526%, 02/25/2036		70,110
		Green Tree Financial
		Corporation:
	143,164	Series 1993-4, Class A5,
		7.05%, 01/15/2019		133,118
	864,947	Series 1998-2, Class A5,
		6.24%, 12/01/2028		753,851
	1,132,394	Series 1998-3, Class A5,
		6.22%, 03/01/2030		908,472
	426,388	Series 1998-4, Class A5,
		6.18%, 04/01/2030		343,579
	57,353	IMC Home Equity
		Loan Trust,
		Series 1998-1, Class A6,
		7.02%, 06/20/2029		47,667

The accompanying notes are an integral part of these financial statements.

Page 18

Baird Intermediate Bond Fund

Schedule of Investments       June 30, 2009 (Unaudited)

Principal
Amount			Value
LONG-TERM INVESTMENTS – 97.1% (cont.)
Asset Backed Securities – 2.4% (cont.)
$	100,000	MBNA Master
		Credit Card Trust,
		Series 2005-4A, Class A4,
		3.38%, 11/15/2012	$	99,086
	185,123	Oakwood Mortgage
		Investors, Inc.,
		Series 1999-B, Class A3,
		6.45%, 11/15/2017		112,927
	19,842	Residential Asset
		Mortgage Products, Inc.,
		Series 2003-RS7, Class AI6,
		5.34%, 08/25/2033		15,536
	130,302	Structured Asset Securities
		Corporation, Series
		2005-2XS, Class 1A2A,
		4.51%, 02/25/2035		122,756
				10,912,886
Financial – 18.6%
		American General Finance
		Corporation Notes:
	25,000	4.625%, 09/01/2010		18,923
	550,000	4.00%, 03/15/2011		364,455
	630,000	AmSouth Bancorporation
		Subordinated Debentures,
		6.75%, 11/01/2025		428,046
	600,000	Banco Santander Chile,
		7.375%, 07/18/2012 f		642,751
	1,900,000	Bancwest Corporation
		Subordinated Notes,
		8.30%, 01/15/2011		1,960,566
	835,000	Bank of America
		Corporation Subordinated
		Notes, 10.20%,
		07/15/2015		873,278
	1,500,000	Bank of Tokyo –
		Mitsubishi/UFJ NY,
		7.40%, 06/15/2011 f		1,543,413
	1,043,000	Bank One Corporation
		Subordinated Notes,
		10.00%, 08/15/2010		1,109,197
	125,000	Bank United
		Subordinated Notes,
		8.00%, 03/15/2009 @		62
	2,695,000	BankAmerica Institutional,
		8.07%, 12/31/2026
		(Acquired 01/04/2006 –
		11/06/2007; Aggregate
		Cost $2,776,627) *		2,236,465
	2,500,000	Banponce Trust I,
		8.327%, 02/01/2027
		(Callable 08/31/2009)		1,469,918
	1,000,000	Barclays Bank PLC
		Subordinated Notes,
		7.40%, 12/15/2009 f		1,018,173
	1,000,000	Bear Stearns Cos., Inc.,
		6.40%, 10/02/2017		1,001,775
	1,000,000	BOI Capital Funding II,
		5.571%, 02/01/2049
		(Callable 02/01/2016)
		(Acquired 01/20/2006;
		Cost $1,000,000) * f		375,000
	520,000	CIT Group Company
		of Canada,
		5.20%, 06/01/2015 f		301,230
		CIT Group, Inc.:
	75,000	4.75%, 12/15/2010		58,876
	200,000	5.40%, 01/30/2016		112,934
	1,500,000	6.10%, 03/15/2067
		(Callable 03/15/2017)		568,935
	1,000,000	Citigroup, Inc.,
		5.50%, 04/11/2013		937,245

The accompanying notes are an integral part of these financial statements.

Page 19

Baird Intermediate Bond Fund

Schedule of Investments       June 30, 2009 (Unaudited)

Principal
Amount			Value
LONG-TERM INVESTMENTS – 97.1% (cont.)
Financial – 18.6% (cont.)
$	1,000,000	Compass Bank
		Subordinated Notes,
		8.10%, 08/15/2009	$	999,208
	1,760,000	Corestates Capital Trust I,
		8.00%, 12/15/2026
		(Acquired 11/29/2005
		and 10/10/2007; Cost
		$267,543 and
		$1,543,518, respectively) *		1,152,677
	375,000	Corp Andina
		De Fomento Notes,
		7.375%, 01/18/2011 f		392,432
	1,900,000	Countrywide Financial
		Corporation Subordinated
		Notes, 6.25%, 05/15/2016		1,685,633
	50,000	Dresdner Bank-New York
		Subordinated Debentures,
		7.25%, 09/15/2015 f		42,918
	1,000,000	Export-Import
		Bank Korea Notes,
		5.125%, 02/14/2011 f		1,013,072
	416,065	First National Bank of
		Chicago Pass-Thru
		Certificates, Series 1993-A,
		8.08%, 01/05/2018		458,945
	2,600,000	First National Bank of
		Omaha Subordinated Notes,
		7.32%, 12/01/2010		2,552,729
	2,125,000	First Union Capital I,
		Series A, 7.935%,
		01/15/2027 (Callable
		08/31/2009)		1,924,967
	775,000	FMR LLC Notes,
		4.75%, 03/01/2013
		(Acquired 02/26/2003;
		Cost $776,022) *		728,585
	2,300,000	GE Global Insurance
		Holding Corp.,
		7.50%, 06/15/2010		2,294,910
		General Electric Capital
		Corporation Notes:
	800,000	6.00%, 06/15/2012		840,952
	2,000,000	5.625%, 09/15/2017		1,914,096
	1,150,000	Genworth Financial Inc.
		Notes, 5.75%, 06/15/2014		807,332
	1,975,000	Glencore Funding LLC,
		6.00%, 04/15/2014
		(Acquired 03/31/2004 –
		12/04/2006; Aggregate
		Cost $1,950,076) *		1,631,172
		GMAC LLC:
	1,025,000	7.75%, 01/19/2010		999,530
	80,000	7.50%, 12/31/2013
		(Acquired 02/26/2007
		and 09/26/2007; Cost
		$270,598 and
		$24,788, respectively) *		62,000
	200,000	6.75%, 12/01/2014		153,755
	96,000	8.00%, 12/31/2018
		(Acquired 02/26/2007
		and 09/26/2007; Cost
		$348,757 and
		$31,678, respectively) *		60,960
		Goldman Sachs
		Group, Inc. Notes:
	1,125,000	5.15%, 01/15/2014		1,129,116
	1,000,000	6.00%, 05/01/2014		1,043,660
	1,800,000	Great West Life & Annuity
		Insurance, 7.153%,
		05/16/2046 (Acquired
		05/16/2006 and 11/08/2007;
		Cost $1,000,000 and
		$792,736, respectively) *		1,386,000

The accompanying notes are an integral part of these financial statements.

Page 20

Baird Intermediate Bond Fund

Schedule of Investments       June 30, 2009 (Unaudited)

Principal
Amount			Value
LONG-TERM INVESTMENTS – 97.1% (cont.)
Financial – 18.6% (cont.)
		HSBC Finance
		Corporation Notes:
$	2,000,000	8.00%, 07/15/2010	$	2,076,360
	100,000	5.00%, 06/30/2015		93,179
	2,000,000	Huntington National
		Bank Notes,
		8.00%, 04/01/2010		2,000,410
		Invesco Ltd.: f
	500,000	5.625%, 04/17/2012		460,468
	500,000	5.375%, 02/27/2013		437,183
		Istar Financial, Inc.:
	1,050,000	5.95%, 10/15/2013		462,000
	75,000	5.85%, 03/15/2017		30,000
	500,000	J.P. Morgan Chase &
		Company Subordinated
		Notes, 6.625%,
		03/15/2012		526,379
	2,000,000	Key Bank NA,
		7.413%, 05/06/2015		1,792,838
	3,000,000	KFW,
		4.875%, 06/17/2019 f		3,108,588
	2,600,000	Kookmin Bank,
		7.25%, 05/14/2014
		(Acquired 06/12/2009;
		Cost $2,643,514) * f		2,684,362
	350,000	Korea Development Bank
		Senior Unsecured Notes,
		4.625%, 09/16/2010 f		352,829
		Lehman Brothers
		Holdings, Inc. Notes:
	1,735,000	8.80%, 03/01/2015 @		255,913
	846,000	8.50%, 08/01/2015 @		124,785
	546,000	Liberty Mutual Group,
		7.25%, 09/01/2012
		(Acquired 08/03/2004;
		Cost $579,177) *		481,170
	775,000	Marsh & McLennan
		Companies, Inc.,
		5.375%, 07/15/2014		754,469
	500,000	MBIA Insurance Corp.,
		14.00%, 01/15/2033
		(Callable 01/15/2013)
		(Acquired 01/11/2008;
		Cost $500,000) *		190,000
		Merrill Lynch & Co, Inc.:
	1,000,000	5.70%, 05/02/2017		857,746
	1,000,000	6.875%, 04/25/2018		925,556
	375,000	Met Life Global
		Funding Senior Notes,
		4.50%, 05/05/2010
		(Acquired 08/04/2005
		and 03/22/2007;
		Cost $123,925 and
		$248,846, respectively) *		379,145
	1,000,000	Monumental Global
		Funding II Senior
		Unsecured Notes,
		5.65%, 07/14/2011		1,000,088
	1,075,000	The Mony Group, Inc.,
		8.35%, 03/15/2010		1,110,472
		Morgan Stanley Senior
		Unsecured Notes:
	1,000,000	5.625%, 01/09/2012		1,023,407
	1,400,000	6.625%, 04/01/2018		1,395,668
	100,000	Morgan Stanley
		Subordinated Notes,
		4.75%, 04/01/2014		94,459
	1,530,000	National Australia Bank Ltd.
		Subordinated Notes, Series
		A, 8.60%, 05/19/2010 f		1,615,298
	350,000	National Bank of Hungary
		Yankee Debentures,
		8.875%, 11/01/2013 f		358,785

The accompanying notes are an integral part of these financial statements.

Page 21

Baird Intermediate Bond Fund

Schedule of Investments       June 30, 2009 (Unaudited)

Principal
Amount			Value
LONG-TERM INVESTMENTS – 97.1% (cont.)
Financial – 18.6% (cont.)
$	2,725,000	National City
		Bank of Cleveland,
		4.50%, 03/15/2010	$	2,764,913
	534,000	National City
		Bank of Kentucky
		Subordinated Notes,
		6.30%, 02/15/2011		540,415
	2,300,000	Navigators Group Inc.
		Senior Unsecured Notes,
		7.00%, 05/01/2016		1,788,273
	1,260,000	NB Capital Trust IV,
		8.25%, 04/15/2027		1,058,012
	1,000,000	North Fork
		Capital Trust II,
		8.00%, 12/15/2027		725,927
	1,319,000	PNC Funding Corporation,
		7.50%, 11/01/2009		1,337,126
		Protective Life
		Corporation Senior Notes:
	475,000	5.45%, 09/28/2012		474,238
	75,000	4.30%, 06/01/2013		69,436
	2,000,000	Rabobank Nederland
		Global Senior Unsecured
		Notes, 4.20%, 05/13/2014
		(Acquired 05/06/2009;
		Cost $1,996,340) * f		1,994,870
	1,650,000	Regions Bank,
		7.50%, 05/15/2018		1,454,115
	800,000	Santander Financial
		Issuances,
		6.375%, 02/15/2011 f		798,326
	1,300,000	Schwab Capital Trust I,
		7.50%, 11/15/2037
		(Callable 11/15/2017)		1,083,693
		SLM Corporation Notes:
	1,516,000	4.50%, 07/26/2010		1,432,620
	250,000	5.375%, 05/15/2014		200,928
	1,000,000	Sovereign Bank,
		8.75%, 05/30/2018		983,504
	1,000,000	St. Paul Travelers, Inc.,
		6.25%, 06/20/2016		1,062,517
	1,046,000	Toll Road Inv.
		Partnership II,
		0.00%, 02/15/2011
		(Acquired 09/28/2004;
		Cost $969,699) * ^		939,766
	1,320,000	Transamerica Finance
		Corporation Debentures,
		0.00%, 03/01/2010 ^		1,230,738
	850,000	UFJ Finance Aruba AEC,
		6.75%, 07/15/2013 f		880,127
	500,000	Washington Mutual Bank
		Subordinated Notes,
		6.875%, 06/15/2011 @		250
	1,000,000	Washington Mutual
		Financial Corporation,
		6.875%, 05/15/2011		1,021,050
	1,495,000	Westdeutsche Landesbank
		Subordinated Notes,
		4.796%, 07/15/2015		1,558,798
				86,287,090
Industrial – 15.9%
	450,000	Alcan, Inc., Notes,
		5.00%, 06/01/2015 f		403,553
		Ameritech Capital
		Funding Debentures:
	1,045,179	9.10%, 06/01/2016		1,059,685
	1,008,000	6.45%, 01/15/2018		1,073,613
	1,000,000	Anadarko Petroleum
		Corporation Senior
		Unsecured Notes,
		6.95%, 06/15/2019		1,009,199

The accompanying notes are an integral part of these financial statements.

Page 22

Baird Intermediate Bond Fund

Schedule of Investments       June 30, 2009 (Unaudited)

Principal
Amount			Value
LONG-TERM INVESTMENTS – 97.1% (cont.)
Industrial – 15.9% (cont.)
$	2,250,000	British Sky
		Broadcasting PLC,
		8.20%, 07/15/2009 f	$	2,251,328
	2,000,000	British
		Telecommunications PLC,
		5.95%, 01/15/2018 f		1,802,484
		Bunge Ltd. Finance
		Corporation Notes:
	800,000	5.35%, 04/15/2014		778,394
	1,085,000	5.10%, 07/15/2015		994,911
	2,025,000	CBS Corporation Senior
		Notes, 7.70%, 07/30/2010		2,085,021
	1,250,000	Clear Channel
		Communications Senior
		Unsubordinated Notes,
		5.50%, 12/15/2016		271,875
	125,000	Comcast Cable
		Communication Holdings,
		8.375%, 03/15/2013		142,500
	525,000	Comcast Corporation,
		6.50%, 01/15/2017		556,953
	75,000	Comcast Holdings
		Corporation,
		10.625%, 07/15/2012		87,750
	1,281,000	COX Communications
		Inc., 7.125%, 10/01/2012		1,377,019
	750,000	COX Communications
		Inc. Senior Unsecured
		Notes, 7.875%, 08/15/2009		754,493
		CSX Corporation:
	1,775,000	5.75%, 03/15/2013		1,819,996
	450,000	6.25%, 04/01/2015		465,232
	1,000,000	D.R. Horton Inc.
		Unsubordinated Notes,
		6.50%, 04/15/2016		855,000
		Deutsche Telekom
		International
		Finance BV: f
	2,000,000	8.50%, 06/15/2010		2,103,330
	1,300,000	6.00%, 07/08/2019		1,311,570
		Donnelley (R.R.)
		& Sons Co.:
	1,500,000	4.95%, 05/15/2010		1,502,051
	875,000	6.125%, 01/15/2017		769,658
	2,300,000	Fiserv, Inc.,
		6.125%, 11/20/2012		2,387,393
	300,000	Ford Motor Company
		Debentures,
		9.215%, 09/15/2021		174,000
	1,260,000	GTE Corp Debentures,
		6.84%, 04/15/2018		1,311,971
	675,000	Halliburton Company
		Notes, 5.50%, 10/15/2010		705,972
	1,375,000	Hanson Australia Funding,
		5.25%, 03/15/2013 f		1,081,163
	650,000	Hanson PLC Notes,
		6.125%, 08/15/2016 f		485,875
	1,195,000	Health Care Service
		Corporation Notes, 7.75%,
		06/15/2011 (Acquired
		06/20/2001, 01/26/2005
		and 10/19/2006; Cost
		$497,765, $346,909 and
		$379,670, respectively) *		1,250,847
	420,000	Highmark, Inc. Notes,
		6.80%, 08/15/2013
		(Acquired 08/14/2003
		and 03/13/2008;
		Cost $399,088 and
		$20,673, respectively) *		388,854

The accompanying notes are an integral part of these financial statements.

Page 23

Baird Intermediate Bond Fund

Schedule of Investments       June 30, 2009 (Unaudited)

Principal
Amount			Value
LONG-TERM INVESTMENTS – 97.1% (cont.)
Industrial – 15.9% (cont.)
		Historic Time
		Warner Inc.:
$	1,847,000	9.125%, 01/15/2013	$	2,033,551
	250,000	6.875%, 06/15/2018		252,542
	2,000,000	Humana Inc.,
		7.20%, 06/15/2018		1,802,282
	1,000,000	Ingersoll-Rand
		Company Debentures,
		6.391%, 11/15/2027 f		1,001,792
	1,175,000	Johnson Controls Inc.
		Senior Notes,
		5.50%, 01/15/2016		1,089,529
	675,000	Laboratory Corporation
		of America Holdings,
		5.50%, 02/01/2013		662,457
	625,000	Lafarge S.A. Notes,
		6.50%, 07/15/2016 f		574,674
	500,000	Limited Brands, Inc.,
		5.25%, 11/01/2014		425,077
	400,000	Marathon Global
		Funding Corporation,
		6.00%, 07/01/2012		422,982
	75,000	Martin Marietta Materials,
		Inc., 6.60%, 04/15/2018		71,305
	1,625,000	Masco Corporation,
		6.125%, 10/03/2016		1,364,343
	650,000	Nabors Industrials, Inc.,
		6.15%, 02/15/2018		623,975
	2,307,000	Nextel Communications
		Senior Notes,
		6.875%, 10/31/2013		1,909,042
	700,000	PCCW-HWT Capital II
		Ltd., 6.00%, 07/15/2013
		(Acquired 07/10/2003;
		Cost $696,731) * f		683,953
	925,000	Pearson Dollar Finance
		PLC, 5.70%, 06/01/2014
		(Acquired 09/28/2005
		and 12/14/2007; Cost
		$611,351 and $321,181,
		respectively) * f		914,921
	1,975,000	PEMEX Project
		Funding Master Trust,
		9.125%, 10/13/2010		2,130,630
	2,045,000	Plum Creek Timberlands,
		5.875%, 11/15/2015		1,728,673
	800,000	Premcor Refining Group
		Senior Unsecured Notes,
		7.50%, 06/15/2015
		(Callable 08/31/2009)		830,022
		Qwest Capital Funding, Inc.:
	350,000	7.00%, 08/03/2009		350,000
	100,000	7.25%, 02/15/2011		97,000
	1,000,000	Reed Elsevier Capital Notes,
		4.625%, 06/15/2012		966,623
	1,800,000	Rio Tinto Financial
		USA Ltd.,
		6.50%, 07/15/2018 f		1,801,049
	75,000	Schering-Plough
		Corporation Senior Notes,
		5.55%, 12/01/2013		80,562
	500,000	Sprint Nextel Corporation,
		6.00%, 12/01/2016		408,750
	1,175,000	Sunoco, Inc. Senior
		Unsecured Notes,
		5.75%, 01/15/2017		1,138,204
		TCI Communications,
		Inc. Debentures:
	550,000	7.875%, 08/01/2013		625,772
	583,000	8.75%, 08/01/2015		664,463

The accompanying notes are an integral part of these financial statements.

Page 24

Baird Intermediate Bond Fund

Schedule of Investments       June 30, 2009 (Unaudited)

Principal
Amount			Value
LONG-TERM INVESTMENTS – 97.1% (cont.)
Industrial – 15.9% (cont.)
		Telecom Italia Capital: f
$	1,360,000	4.95%, 09/30/2014	$	1,301,954
	725,000	5.25%, 10/01/2015		699,869
	981,000	Tele-Communications,
		Inc. Debentures,
		9.80%, 02/01/2012		1,104,317
	1,725,000	Telefonica
		Emisiones, S.A.U.,
		6.421%, 06/20/2016 f		1,844,389
	1,000,000	Time Warner Cable, Inc.,
		5.85%, 05/01/2017		998,601
	1,470,000	Transocean, Inc.,
		6.625%, 04/15/2011 f		1,566,429
	500,000	Tyco Electronics
		Group S. A.,
		6.55%, 10/01/2017 f		453,963
		Tyco International
		Finance: f
	1,575,000	6.375%, 10/15/2011		1,659,628
	650,000	6.00%, 11/15/2013		660,932
		United AirLines, Inc.
		Pass-Thru Certificates:
	202,310	Series 1991-A, Class A-2,
		10.02%, 03/22/2014		67,774
	245,275	Series 2000-2, Class C,
		7.762%, 10/01/2049		210,324
	25,398	Series 2001-1, Class A-2,
		6.201%, 12/31/2049		25,144
	1,500,000	Vale Overseas Limited,
		6.25%, 01/23/2017 f		1,512,396
	250,000	Verizon Communications,
		Inc. Senior Unsecured
		Notes, 5.55%, 02/15/2016		258,766
	650,000	Verizon New York Inc.
		Senior Unsecured Notes,
		8.625%, 11/15/2010		694,477
	1,000,000	Vodafone Group PLC
		Senior Unsecured Notes,
		7.75%, 02/15/2010 f		1,033,810
	2,000,000	Vulcan Materials Co.,
		7.00%, 06/15/2018		1,928,072
	25,000	Waste Management, Inc.,
		5.00%, 03/15/2014		24,427
	1,450,000	Wellpoint, Inc.,
		6.80%, 08/01/2012		1,513,320
	500,000	Willamette Industries,
		Inc. Notes,
		6.60%, 06/05/2012		487,269
				73,961,724
Mortgage Backed Securities – 16.1%
		Bank of America
		Alternative Loan Trust:
	412,975	Series 2003-11, Class 4A1,
		4.75%, 01/25/2019		398,392
	1,200,504	Series 2004-2, Class 5A1,
		5.50%, 03/25/2019		1,092,555
	1,461,486	Series 2004-11, Class 4A1,
		5.50%, 12/25/2019		1,412,618
	66,573	Series 2005-6, Class 7A1,
		5.50%, 07/25/2020		60,353
	830,700	Series 2006-2, Class 7A1,
		6.00%, 03/25/2021		713,104
	1,218,501	Series 2006-3, Class 6A1,
		6.00%, 04/25/2036		892,171
	1,184,167	Series 2006-4, Class 3CB4,
		6.00%, 05/25/2046		806,604
	879,526	Bank of America
		Funding Corporation,
		Series 2003-3, Class 1A41,
		5.50%, 10/25/2033		857,510

The accompanying notes are an integral part of these financial statements.

Page 25

Baird Intermediate Bond Fund

Schedule of Investments       June 30, 2009 (Unaudited)

Principal
Amount			Value
LONG-TERM INVESTMENTS – 97.1% (cont.)
Mortgage Backed Securities – 16.1% (cont.)
		Citicorp Mortgage
		Securities, Inc.:
$	1,266,401	Series 2004-5, Class 1A25,
		5.50%, 10/25/2014	$	1,204,213
	76,359	Series 2004-4, Class A2,
		5.25%, 06/25/2034		75,692
	1,163,219	Series 2004-4, Class A5,
		5.50%, 06/25/2034		1,148,127
		Countrywide Alternative
		Loan Trust:
	309,777	Series 2005-5R, Class A2,
		4.75%, 12/25/2018		284,445
	1,169,034	Series 2005-50CB, Class
		4A1, 5.00%, 11/25/2020		916,163
	1,344,789	Series 2005-85CB, Class
		3A1, 5.25%, 02/25/2021
		(Acquired 09/26/2007 –
		01/28/2009; Aggregate
		Cost $1,251,900) *		991,089
	1,985,017	Series 2006-7CB, Class
		3A1, 5.25%, 05/25/2021		1,382,689
	125,000	Series 2005-10CB, Class
		1A6, 5.50%, 05/25/2035		89,735
	140,456	Series 2005-11CB, Class
		2A1, 5.50%, 06/25/2035		110,252
	1,294,980	Series 2005-34CB, Class
		1A6, 5.50%, 09/25/2035		1,080,832
	823,505	Countrywide Home
		Loans, Inc.,
		Series 2003-18, Class A3,
		5.25%, 07/25/2033		800,373
		Credit Suisse First Boston
		Mortgage Securities Corp.:
	82,003	Series 2005-11, Class 5A1,
		5.25%, 12/25/2020		73,694
	118,894	Series 2005-3, Class 3A27,
		5.50%, 07/25/2035		103,472
		Federal Gold Loan
		Mortgage Corporation
		(FGLMC) Pass-Thru
		Certificates:
	718,229	5.00%, 08/01/2011		745,435
	1,009,722	6.00%, 06/01/2021		1,069,138
	44,409	6.00%, 07/01/2028		46,852
		Federal Home Loan
		Mortgage Corporation
		(FHLMC):
	1,125,081	Series 3033, Class LU,
		5.50%, 03/15/2013		1,185,751
	1,330,800	Series 2695, Class UA,
		5.50%, 09/15/2014		1,388,195
	5,524,215	Series R014, Class AL,
		5.50%, 10/15/2014		5,639,199
	470,093	Series R001, Class AE,
		4.375%, 04/15/2015		482,532
	1,825,612	Series R003, Class VA,
		5.50%, 08/15/2016		1,952,772
	2,311,966	Series 3122, Class VA,
		6.00%, 01/15/2017		2,445,730
	1,631,184	Series R010, Class VA,
		5.50%, 04/15/2017		1,747,893
	3,280,481	Series R009, Class AJ,
		5.75%, 12/15/2018		3,395,117
	4,650	Series 74, Class F,
		6.00%, 10/15/2020		4,759
	150,000	Series 2673, Class NC,
		5.50%, 05/15/2021		156,943
	36,832	Series 1395, Class G,
		6.00%, 10/15/2022		38,432
	2,914,599	Series 2970, Class DA,
		5.50%, 01/15/2023		3,024,411

The accompanying notes are an integral part of these financial statements.

Page 26

Baird Intermediate Bond Fund

Schedule of Investments       June 30, 2009 (Unaudited)

Principal
Amount			Value
LONG-TERM INVESTMENTS – 97.1% (cont.)
Mortgage Backed Securities – 16.1% (cont.)
		Federal National Mortgage
		Association (FNMA):
$	742,475	Series 2006-B2, Class AB,
		5.50%, 05/25/2014	$	771,540
	674,542	Series 2003-24, Class PC,
		5.00%, 11/25/2015		687,028
	84,239	Series 2005-6, Class VE,
		5.50%, 04/25/2016		89,631
	1,525,544	Series 2006-B1, Class AB,
		6.00%, 06/25/2016		1,585,132
	46,024	Series 2003-35, Class TD,
		5.00%, 12/25/2016		46,930
	21,869	Series 1989-2, Class D,
		8.80%, 01/25/2019		23,692
	1,637	Series G-29, Class O,
		8.50%, 09/25/2021		1,767
	143,561	Series 1991-137, Class H,
		7.00%, 10/25/2021		155,800
	116,057	Series 1992-136, Class PK,
		6.00%, 08/25/2022		124,552
	65,597	Series 1993-32, Class H,
		6.00%, 03/25/2023		69,413
	5,812,573	Series 2002-85, Class PD,
		5.50%, 05/25/2031		5,989,570
	119,408	Series 2004-90, Class YB,
		4.00%, 07/25/2032		121,736
	2,271,466	Series 2004-W6, Class 1A6,
		5.50%, 07/25/2034		2,372,973
	3,339,850	Series 2004-W10, Class
		A24, 5.00%, 08/25/2034		3,310,522
	4,061,041	GMAC Commercial
		Mortgage Securities Inc,
		Series 2001-C1, Class A2,
		6.465%, 04/15/2034		4,128,768
		GMAC Mortgage
		Corporation Loan Trust:
	140,492	Series 2003-J1, Class A2,
		5.25%, 03/25/2018		137,633
	1,381,718	Series 2004-J4, Class A2,
		5.50%, 09/25/2034		1,369,087
	349,031	Government National
		Mortgage Association
		(GNMA),
		Series 1999-4, Class ZB,
		6.00%, 02/20/2029		372,958
		J.P. Morgan Alternative
		Loan Trust:
	3,078,027	Series 2005-S1, Class 3A1,
		5.50%, 10/25/2020		2,082,478
	1,268,402	Series 2006-A1, Class 2A1,
		5.80%, 03/25/2036		716,467
	2,068,789	Series 2006-S2, Class A2,
		5.81%, 05/25/2036		1,778,465
	674,837	Lehman Mortgage Trust,
		Series 2006-4, Class 3A1,
		5.00%, 08/25/2021		563,278
		Master Alternative
		Loans Trust:
	1,946,057	Series 2004-1, Class 1A1,
		5.00%, 01/25/2019		1,721,653
	426,144	Series 2004-3, Class 1A1,
		5.00%, 03/25/2019		398,311
	337,139	Series 2005-3, Class 4A1,
		5.50%, 03/25/2020		272,003
	69,807	Merrill Lynch Mortgage
		Investors Inc.,
		Series 2005-A8, Class
		A1C1, 5.25%, 08/25/2036		61,118

The accompanying notes are an integral part of these financial statements.

Page 27

Baird Intermediate Bond Fund

Schedule of Investments       June 30, 2009 (Unaudited)

Principal
Amount			Value
LONG-TERM INVESTMENTS – 97.1% (cont.)
Mortgage Backed Securities – 16.1% (cont.)
		Residential Accredit
		Loans, Inc.:
$	51,342	Series 2004-QS6, Class
		A1, 5.00%, 05/25/2019	$	46,962
	50,428	Series 2004-QS13, Class
		CB, 5.00%, 09/25/2019		44,613
	300,377	Salomon Brothers
		Mortgage Securities VII,
		Series 2003-UP2, Class A2,
		4.00%, 06/25/2033		295,170
		Washington Mutual, Inc.
		Pass-Thru Certificates:
	2,110,283	Series 2004-CB1, Class 5A,
		5.00%, 06/25/2019		2,077,969
	2,942,568	Series 2004-CB3, Class 3A,
		5.50%, 10/25/2019		2,932,453
	1,085,937	Series 2004-CB3, Class 4A,
		6.00%, 10/25/2019		986,506
	678,663	Series 2004-CB4, Class
		21A, 5.50%, 12/25/2019		604,807
	883,823	Series 2004-CB4, Class
		22A, 6.00%, 12/25/2019		797,692
				74,555,919
Taxable Municipal Bonds – 0.2%
	1,430,000	Tobacco Settlement
		Authority Iowa,
		6.50%, 06/01/2023		1,069,712
	187,586	Tobacco Settlement
		Financing Corporation,
		Series 2001-A, Class A,
		6.36%, 05/15/2025		172,742
				1,242,454
Utilities – 6.3%
	2,415,000	Baltimore Gas &
		Electic Co. Senior
		Unsecured Notes,
		6.125%, 07/01/2013		2,520,217
	1,715,000	Cilcorp Inc. Senior Notes,
		8.70%, 10/15/2009		1,680,700
	50,000	Commonwealth Edison,
		5.95%, 08/15/2016		51,988
		Dominion Resources Inc.:
	450,000	6.25%, 06/30/2012		483,154
	1,000,000	5.15%, 07/15/2015		1,014,402
	600,000	Energy Transfer Partners,
		5.65%, 08/01/2012		611,860
	600,000	Exelon Corporation
		Senior Notes,
		6.75%, 05/01/2011		626,260
	2,500,000	Kinder Morgan Finance,
		5.70%, 01/05/2016 f		2,143,750
	287,305	Kiowa Power Partners LLC,
		4.811%, 12/30/2013
		(Acquired 11/19/2004;
		Cost $287,305) *		263,644
	300,000	Korea Electric Power
		Corporation,
		6.75%, 08/01/2027 f		228,042
	1,000,000	Korea Hydro & Nuclear
		Power Company Senior
		Unsecured Notes,
		6.25%, 06/17/2014
		(Acquired 06/10/2009;
		Cost $989,350) * f		997,522
	1,475,000	National Grid PLC
		Senior Unsecured Notes,
		6.30%, 08/01/2016 f		1,515,393

The accompanying notes are an integral part of these financial statements.

Page 28

Baird Intermediate Bond Fund

Schedule of Investments       June 30, 2009 (Unaudited)

Principal
Amount			Value
LONG-TERM INVESTMENTS – 97.1% (cont.)
Utilities – 6.3% (cont.)
		NiSource Finance
		Corporation:
$	1,000,000	2.915%, 11/23/2009
		(Callable 08/31/2009)	$	992,059
	175,000	7.875%, 11/15/2010		180,756
	1,000,000	10.75%, 03/15/2016		1,109,197
	1,875,000	ONEOK, Inc.
		Senior Notes,
		7.125%, 04/15/2011		1,976,884
	400,000	ONEOK Partners
		LP Notes,
		5.90%, 04/01/2012		410,380
	1,775,000	PPL Energy Supply,
		LLC Bonds, Series A
		5.70%, 10/15/2015		1,791,488
	388,000	PPL Energy Supply,
		LLC Senior Notes,
		6.40%, 11/01/2011		408,659
	900,000	Progress Energy, Inc.
		Senior Notes,
		6.85%, 04/15/2012		974,740
	175,000	PSE&G Energy Holdings
		LLC Senior Notes,
		8.50%, 06/15/2011		176,683
		PSE&G Power LLC:
	275,000	7.75%, 04/15/2011		294,328
	425,000	5.00%, 04/01/2014		428,388
	805,997	RGS (I&M) Funding
		Corporation Debentures,
		9.82%, 12/07/2022		881,978
	1,500,000	Rockies Express Pipeline
		LLC, 5.776%, 08/20/2009
		(Acquired 09/17/2007;
		Cost $1,499,619) *		1,500,143
	1,400,000	Spectra Energy Capital,
		5.668%, 08/15/2014		1,413,665
	1,340,000	Transcontinental Gas
		Pipe Line Corporation
		Senior Notes,
		8.875%, 07/15/2012		1,473,346
		Vectren Utility Holdings:
	1,000,000	6.625%, 12/01/2011		1,048,503
	575,000	5.25%, 08/01/2013		582,153
	1,375,000	Williams Companies, Inc.
		Senior Unsecured Notes:
		8.125%, 03/15/2012		1,424,981
	251,896	Yosemite Securities Trust I,
		8.25%, 11/15/2104
		(Acquired 04/26/2001;
		Cost $251,896) * f @		157
				29,205,420
U.S. Government Agency Issues – 17.0%
	225,000	Federal Home Loan
		Mortgage Corporation
		(FHLMC),
		4.50%, 07/15/2013		242,193
		Federal National Mortgage
		Association (FNMA):
	44,175,000	3.625%, 02/12/2013		46,446,788
	32,125,000	2.75%, 03/13/2014		32,056,253
				78,745,234
U.S. Treasury Obligations – 20.6%
		U.S. Treasury Bonds:
	11,425,000	2.25%, 05/31/2014		11,271,448
	48,350,000	9.125%, 05/15/2018		69,257,604
	10,650,000	8.50%, 02/15/2020		14,976,562
				95,505,614
		Total Long-Term
		Investments
		(Cost $469,150,003)		450,416,341

The accompanying notes are an integral part of these financial statements.

Page 29

Baird Intermediate Bond Fund

Schedule of Investments       June 30, 2009 (Unaudited)

Shares			Value
SHORT-TERM INVESTMENTS – 2.3%
Money Markets – 2.3%
	10,707,395	Short-Term Investment
		Company Liquid Assets
		Portfolio – AIM Fund	$	10,707,395
		Total Short-Term
		Investments
		(Cost $10,707,395)		10,707,395
Principal
Amount
INVESTMENTS PURCHASED
WITH CASH PROCEEDS FROM
SECURITIES LENDING – 39.9%
Commercial Paper – 0.7%
$	3,289,728	Atlantic East
		Funding LLC,
		3.059%, 03/25/10 # **		3,289,728
				3,289,728
Corporate Bond – 0.7%
	3,018,477	Svenska Handelsbanken,
		4.418%, 08/06/09 f		3,018,477
				3,018,477
Shares
Investment Companies – 38.5%
	177,739,341	Mount Vernon Securities
		Lending Trust
		Prime Portfolio		177,739,341
	1,067,653	Reserve Primary Fund # **		1,067,653
				178,806,994
		Total Investments
		Purchased With Cash
		Proceeds From
		Securities Lending
		(Cost $185,115,199)		185,115,199
		Total Investments
		(Cost $664,972,597) –
		139.3%		646,238,935
		Liabilities in Excess of
		Other Assets – (39.3)%		(182,224,008	)
		TOTAL NET
		ASSETS – 100.0%	$	464,014,927

* Restricted Security Deemed Liquid

** Illiquid Security

f Foreign Security

^ Non-Income Producing

# Priced at Fair Value by the Valuation Committee as delegated by the Baird Funds’ Board of Directors

@ Security in Default

The accompanying notes are an integral part of these financial statements.

Page 30

Baird Intermediate Bond Fund

Schedule of Investments       June 30, 2009 (Unaudited)

SFAS 157 – Summary of Fair Value Exposure at June 30, 2009

As adopted by the Fund, the Financial Accounting Standards Board issued Statement of Financial Accounting Standards No. 157, “Fair Value Measurements” (“SFAS 157”) defines fair value, establishes a framework for measuring fair value in generally accepted accounting principles (GAAP), and expands disclosures about fair value measurements.  Under SFAS 157, various inputs are used in determining the value of the Fund’s investments.  These inputs are summarized into three broad levels and described below:

Level 1 –	Quoted prices in active markets for identical securities.
Level 2 –	Other significant observable inputs (including quoted prices for similar securities, quoted prices for identical securities in inactive markets, dealer indications, interest rates, yield curves, benchmark yields, issuer spreads, prepayment speeds, cash flows, credit risk, default rates, information about issuers, sectors and markets, inputs corroborated by observable market data, etc.)
Level 3 –	Significant unobservable inputs (including the Fund’s own assumptions about the assumptions that market participants would use in pricing the security).

The inputs or methodology used for valuing securities are not necessarily an indication of the risk associated with investing in those securities.

The following is a summary of the inputs used to value the Fund’s investments as of June 30, 2009:

	Level 1		Level 2		Level 3		Total
Fixed Income
Asset Backed Securities	$	—	$	10,912,886	$	—	$	10,912,886
Corporate Debt Securities		—		189,454,234		—		189,454,234
Mortgage Backed Securities		—		74,555,919		—		74,555,919
Taxable Municipal Bonds		—		1,242,454		—		1,242,454
U.S. Government Agency Issues		—		78,745,234		—		78,745,234
U.S. Treasury Obligations		—		95,505,614		—		95,505,614
Total Fixed Income		—		450,416,341		—		450,416,341
Short-Term Investments
Money Market Mutual Funds		10,707,395		—		—		10,707,395
Total Short-Term Investments		10,707,395		—		—		10,707,395
Investments Purchased With Cash
Proceeds From Securities Lending
Commercial Paper		—		3,289,728		—		3,289,728
Corporate Bonds		—		3,018,477		—		3,018,477
Money Market Mutual Funds		177,739,341		—		1,067,653		178,806,994
Total Investments Purchased With Cash
Proceeds From Securities Lending		177,739,341		6,308,205		1,067,653		185,115,199
Total Investments in Securities	$	188,446,736	$	456,724,546	$	1,067,653	$	646,238,935

Page 31

Baird Intermediate Bond Fund

Schedule of Investments       June 30, 2009 (Unaudited)

Level 3 Reconciliation Disclosure

Following is a reconciliation of Level 3 assets for which significant unobservable inputs were used to determine fair value.

Description	Investments in Securities
Balance as of December 31, 2008	$	2,371,982
Accrued discounts/premiums		—
Realized gain (loss)		—
Change in unrealized appreciation (depreciation)		—
Net purchases (sales/paydowns)		(1,195,628	)
Transfers in and/or out of Level 3 *		(108,701	)
Balance as of June 30, 2009	$	1,067,653
Change in unrealized appreciation (depreciation) during
the year for level 3 investments held at June 30, 2009.		—

* The information used in the above reconciliation represents fiscal year to date activity for any investments identified as using Level 3 inputs at either the beginning or end of the current fiscal period.  Transfers in or out of Level 3 represents either the beginning value (for transfers in) or ending value (for transfers out) of any security or instrument where a change in the pricing level occurred from the beginning to the end of the period.

Page 32

Baird Intermediate Municipal Bond Fund

June 30, 2009

The Baird Intermediate Municipal Bond Fund seeks current income that is substantially exempt from federal income tax.  A secondary objective is to provide total return with relatively low volatility of principal.  The Fund strives to achieve an annual rate of return, before Fund expenses, greater than the annual rate of the total return of the Barclays Capital 7-Year General Obligation Bond Index.  The Barclays Capital 7-Year General Obligation Bond Index is an unmanaged, market value weighted index consisting of investment grade state and local general obligation bonds that have been issued as part of an offering of at least $50 million; have a minimum amount outstanding of at least $5 million; have been issued within the last five years; and have a maturity of six to eight years.

Portfolio Characteristics

Quality Distribution*	Sector Weightings*

Net Assets:	$500,899,071	Annualized Expense Ratio:
SEC 30-Day Yield:**		Institutional Class:	0.30	%
Institutional Class:	2.56%	Investor Class:	0.55	%***
Investor Class:	2.32%	Portfolio Turnover Rate:	0.5	%#
Average Effective Duration:	4.76 years	Total Number of Holdings:	182
Average Effective Maturity:	5.60 years

* Percentages shown are based on the Fund’s total net assets.

** SEC yields are based on SEC guidelines and are calculated for the 30 days ended June 30, 2009.

*** Includes 0.25% 12b-1 fee.

# Not annualized.

Page 33

Baird Intermediate Municipal Bond Fund

Average Annual Total Returns

			Since
For the Periods Ended June 30, 2009	One Year	Five Years	Inception(1)
Institutional Class Shares	8.15%	4.65%	5.10%
Investor Class Shares	7.87%	4.37%	4.82%
Barclays Capital 7-Year General Obligation Bond Index(2)	6.88%	4.62%	4.86%

(1) For the period from March 30, 2001 (commencement of operations) through June 30, 2009.

(2) The Barclays Capital 7-Year General Obligation Bond Index is an unmanaged, market value weighted index comprised of investment grade state and local general obligation bonds that have been issued as part of an offering of at least $50 million, have a minimum amount outstanding of at least $5 million, have been issued within the last five years and have a maturity of six to eight years.  This index does not reflect any deduction for fees, expenses or taxes.  A direct investment in an index is not possible.

The returns shown in the table above reflect reinvestment of dividends and/or capital gains distributions in additional shares.  The returns do not reflect the deduction of taxes that a shareholder would pay on Fund distributions or the redemption of Fund shares.

Past performance does not guarantee future results.  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.

For information about the performance of the Fund as of the most recent month-end, please call 1-866-44BAIRD or visit www.bairdfunds.com.  Mutual fund performance changes over time and current performance may be lower or higher than that stated.

Page 34

Baird Intermediate Municipal Bond Fund

Schedule of Investments       June 30, 2009 (Unaudited)

Principal
Amount			Value
MUNICIPAL BONDS – 92.3%
Alabama – 2.5%
$	11,385,000	Montgomery Alabama
		Special Care Facility
		Revenue, 5.00%,
		11/15/2021
		(Pre-refunded
		to 11/15/2014)	$	12,652,834
Alaska – 0.2%
	1,000,000	Alaska State Housing
		Finance Corporation,
		5.00%, 06/01/2017
		(Insured by NPFGC)		1,044,060
Arizona – 2.1%
	1,415,000	Arizona Health Facilities
		Authority Hospital
		Revenue, 6.375%,
		12/01/2037 (Pre-refunded
		to 12/01/2012)		1,657,984
	2,375,000	Arizona School Facilities
		Board Revenue, 5.75%,
		07/01/2018 (Pre-refunded
		to 07/01/2014)		2,787,015
	1,540,000	Phoenix Arizona
		Civic Corporation
		of Wastewater
		Systems Revenue,
		5.00%, 07/01/2015
		(Partially Pre-refunded,
		NPFGC Insured)		1,714,436
	1,000,000	Pima County
		Arizona Independent
		Development Authority,
		7.125%, 07/01/2024
		(Pre-refunded
		to 07/01/2014)		1,214,500
	2,770,000	Pima County Arizona
		Industrial Development
		Authority Revenue, 7.50%,
		07/01/2034 (Pre-refunded
		07/01/2014)		3,289,153
				10,663,088
Arkansas – 0.0%
	230,000	Springdale Arkansas Sales
		& Use Tax Revenue, 4.00%,
		07/01/2016 (Pre-refunded
		to various dates)		232,335
California – 3.4%
	2,515,000	Coalinga California Regional
		Medical Center, 5.125%,
		03/01/2032 (Pre-refunded
		to 03/01/2015)		2,840,592
		Golden State Tobacco
		Securitization Corporation
		Revenue Bonds:
	1,835,000	6.25%, 06/01/2033
		(Pre-refunded to
		various dates)		2,036,446
	1,365,000	6.75%, 06/01/2039
		(Pre-refunded to
		06/01/2013)		1,587,127
	1,760,000	6.625%, 06/01/2040
		(Pre-refunded to
		06/01/2013)		2,038,256
	2,360,000	5.50%, 06/01/2043
		(Pre-refunded to
		06/01/2013)		2,639,353
	2,975,000	Pittsburg California
		Redevelopment Agency
		Residential Mortgage
		Revenue, 9.60%,
		06/01/2016 (ETM)		4,211,380

The accompanying notes are an integral part of these financial statements.

Page 35

Baird Intermediate Municipal Bond Fund

Schedule of Investments       June 30, 2009 (Unaudited)

Principal
Amount			Value
MUNICIPAL BONDS – 92.3% (cont.)
California – 3.4% (cont.)
$	1,600,000	Port Oakland California
		Revenue, 5.00%,
		11/01/2017 (Insured
		by NPFGC)	$	1,619,440
	165,000	Santa Rosa California
		Hospital Revenue, 10.30%,
		03/01/2011 (ETM)		182,503
				17,155,097
Colorado – 9.3%
	2,000,000	Adams County Colorado
		Single Family Mortgage
		Revenue, 8.875%,
		08/01/2012 (ETM)		2,459,160
	1,000,000	Aspen Grove Colorado
		Business Improvement
		District, 7.625%,
		12/01/2025 (Pre-refunded
		12/01/2011)		1,138,930
		Colorado Springs Colorado
		Utilities Revenue Bonds:
	50,000	5.80%, 11/15/2010 (ETM)		50,799
	9,830,000	5.875%,
		11/15/2017 (ETM)		11,142,010
		Denver Colorado
		Convention Center
		& Hotel Authority
		Revenue Bonds:
	1,000,000	5.00%, 12/01/2021
		(Pre-refunded to
		12/01/2013)		1,112,420
	1,500,000	5.00%, 12/01/2023
		(Pre-refunded to
		12/01/2013)		1,668,630
	5,065,000	5.00%, 12/01/2024
		(Pre-refunded to
		12/01/2013)		5,634,407
	7,975,000	Denver Colorado Health
		& Hospital Authority
		Healthcare Revenue,
		6.25%, 12/01/2033
		(Pre-refunded to
		12/01/2014)		9,544,241
	5,460,000	Pueblo County Colorado
		Certificate Participation,
		6.50%, 12/01/2024
		(Pre-refunded to
		12/01/2010)		5,878,782
	6,750,000	Regional Transportation
		District Colorado Sales
		Tax Revenue, 5.00%,
		11/01/2036 (Pre-refunded
		11/01/2016)		7,784,303
				46,413,682
Delaware – 0.3%
	1,230,000	Delaware State Economic
		Development Authority
		Revenue, 6.75%,
		01/01/2013 (ETM)		1,338,326
Florida – 10.6%
	4,240,000	Bartram Springs
		Community Development
		District Special Assessment,
		6.65%, 05/01/2034
		(Pre-refunded to
		05/01/2013)		4,839,494
	1,925,000	Brevard County Florida
		School Board,
		5.00%, 07/01/2020
		(Insured by AMBAC)		1,848,770

The accompanying notes are an integral part of these financial statements.

Page 36

Baird Intermediate Municipal Bond Fund

Schedule of Investments       June 30, 2009 (Unaudited)

Principal
Amount			Value
MUNICIPAL BONDS – 92.3% (cont.)
Florida – 10.6% (cont.)
$	5,000,000	Coral Gables Florida
		Health Facility Authority
		Hospital Revenue, 5.00%,
		08/15/2029 (Pre-refunded
		to 08/15/2014)	$	5,680,600
	2,230,000	Dade County Florida
		Health Facility Authority
		Hospital Revenue, 5.75%,
		05/01/2021 (ETM)		2,523,802
	2,500,000	Florida State Department
		of Management Services,
		5.00%, 08/01/2018		2,538,175
	4,675,000	Florida State Mid-Bay
		Bridge Authority
		Revenue, 6.875%,
		10/01/2022 (ETM)		5,989,470
	1,500,000	Gulf Environmental
		Services Inc. Florida
		Revenue Bonds, 5.00%,
		10/01/2018 (ETM)		1,641,870
	2,000,000	Highlands County Florida
		Health Facilities Revenue,
		5.375%, 11/15/2035
		(Pre-refunded to
		11/15/2013)		2,271,380
	2,000,000	Hillsborough County
		Florida School Board
		Master Lease Program,
		5.50%, 07/01/2018
		(Insured by NPFGC)		2,061,440
	2,100,000	Islands At Doral (SW)
		Community Development
		District, 6.375%,
		05/01/2035 (Pre-refunded
		to 05/01/2013)		2,374,008
	300,000	Jacksonville Florida Health
		Facility Authority Hospital
		Revenue, 11.50%,
		10/01/2012 (ETM)		395,526
	1,470,000	Miami Beach Florida
		Resort Tax Revenue,
		6.25%, 10/01/2022 (ETM)		1,776,583
	3,000,000	Miami Dade County
		Florida Entitlement
		Revenue Bonds,
		5.00%, 08/01/2015
		(Insured by NPFGC)		3,191,760
	2,020,000	Miami-Dade County Florida
		Water & Sewer Revenue,
		5.00%, 10/01/2013
		(Insured by NPFGC)		2,158,754
	3,885,000	Oakstead Florida
		Community Development
		District Capital
		Improvement Revenue
		Bonds, 6.875%,
		05/01/2033 (Pre-refunded
		05/01/2012)		4,412,971
	1,060,000	Orange County Florida
		Health Facilities Authority
		Revenue Bond, 6.25%,
		10/01/2013 (ETM)		1,228,031
	55,000	Orange County Florida
		Health Revenue, 8.75%,
		10/01/2009 (ETM)		56,069
	1,000,000	Orlando Florida Utilities
		Commission Water &
		Electric Revenue, 6.75%,
		10/01/2017 (ETM)		1,186,120
	1,000,000	Palm Beach County
		Florida Revenue,
		5.00%, 11/01/2018		1,079,670

The accompanying notes are an integral part of these financial statements.

Page 37

Baird Intermediate Municipal Bond Fund

Schedule of Investments       June 30, 2009 (Unaudited)

Principal
Amount			Value
MUNICIPAL BONDS – 92.3% (cont.)
Florida – 10.6% (cont.)
$	1,000,000	Sarasota County Florida
		School Board,
		5.00%, 07/01/2015
		(Insured by NPFGC)	$	1,050,590
	4,000,000	Seminole County
		Florida Water & Sewage
		Revenue, 6.00%,
		10/01/2019 (ETM)		4,643,040
				52,948,123
Georgia – 0.2%
	1,020,000	Fulton County Georgia
		Hospital Authority
		Revenue, 7.875%,
		10/01/2013 (ETM)		1,162,769
Illinois – 7.4%
	1,000,000	Chicago Illinois Board
		of Education, 5.00%,
		12/01/2017 (Insured
		by AMBAC)		1,077,390
	1,000,000	Chicago Illinois General
		Obligation Project and
		Refunding, 5.00%,
		01/01/2017 (FSA Insured)		1,086,360
	1,440,000	Chicago Illinois
		Metropolitan Water
		Reclamation District
		General Obligation, 7.00%,
		12/01/2010 (ETM)		1,565,769
	1,000,000	Chicago Illinois Public
		Building Community
		Building Revenue, 7.00%,
		01/01/2020 (ETM)		1,260,880
	2,305,000	Cook County Illinois
		School District No. 097,
		9.00%, 12/01/2015
		(Insured by NPFGC)		3,021,786
	1,430,000	Cook County Illinois
		School District
		No. 100, 8.10%,
		12/01/2016 (ETM)		1,941,497
	1,000,000	Du Page County Illinois
		Stormwater Project,
		5.60%, 01/01/2021		1,125,620
	2,000,000	Illinois State Toll Highway
		Authority Priority Revenue
		Bonds, 5.50%, 01/01/2016
		(Insured by FSA)		2,276,280
		Illinois State Toll Highway
		Authority Revenue Bonds:
	820,000	5.00%, 01/01/2026
		(Pre-refunded to
		07/01/2016)		947,247
	1,905,000	5.00%, 01/01/2031
		(Pre-refunded to
		07/01/2016)		2,200,618
	6,750,000	Kane & Du Page Counties
		Illinois Community United
		School District No. 303,
		5.00%, 01/01/2014
		(Insured by FSA)		7,410,757
	1,025,000	Lake County Illinois
		Community High School
		District No. 124 Grant,
		5.00%, 12/01/2017		1,161,581
	1,000,000	Lake County Illinois
		Community High School
		District No. 128,
		5.00%, 01/01/2013		1,106,940

The accompanying notes are an integral part of these financial statements.

Page 38

Baird Intermediate Municipal Bond Fund

Schedule of Investments       June 30, 2009 (Unaudited)

Principal
Amount			Value
MUNICIPAL BONDS – 92.3% (cont.)
Illinois – 7.4% (cont.)
		McHenry & Kane Counties
		Illinois Community School
		District No. 158:
$	1,870,000	0.00%, 01/01/2013 ^
		(Insured by NPFGC)	$	1,596,924
	1,970,000	0.00%, 01/01/2016 ^		1,403,113
	1,805,000	Metropolitan Pier &
		Exposition Authority
		Illinois, 5.50%,
		06/15/2016 (ETM)		2,109,251
	2,000,000	Northwest Suburban
		Illinois Municipal Joint
		Action Revenue, 5.00%,
		05/01/2014 (ETM)		2,272,340
	1,390,000	Southern Illinois
		University Revenue,
		5.25%, 04/01/2019
		(Insured by NPFGC)		1,470,231
	950,000	Winnebago & Boone
		Counties Illinois School
		District No. 205,
		5.00%, 02/01/2013
		(Insured by AMBAC)		954,275
	1,360,000	Winnebago County Illinois
		School District No. 122,
		0.00%, 01/01/2018 ^
		(Insured by FSA)		979,921
				36,968,780
Indiana – 1.2%
		Hammond Indiana
		Multi-School Building
		Corporation Revenue Bonds:
	1,000,000	6.00%, 01/15/2018 (ETM)		1,148,660
	1,330,000	5.00%, 07/15/2018
		(Insured by NPFGC)		1,488,696
	285,000	Indiana Toll Road
		Commission, 9.00%,
		01/01/2015 (ETM)		350,593
	1,650,000	Purdue University
		Indiana Revenue,
		5.00%, 07/01/2015		1,857,487
	1,000,000	South Bend Indiana
		Community School
		Building Corporation,
		5.00%, 07/15/2017
		(Insured by NPFGC)		1,088,820
				5,934,256
Iowa – 0.6%
	1,010,000	Des Moines Iowa
		Metropolitan Wastewater
		Reclamation Authority,
		5.00%, 06/01/2015
		(Insured by NPFGC)		1,114,515
	335,000	Muscatine Iowa Electric
		Revenue, 6.70%,
		01/01/2013 (ETM)		370,724
	1,535,000	Tobacco Settlement
		Authority Iowa Revenue
		Bonds, 5.30%, 06/01/2025
		(Pre-refunded to
		06/01/2011)		1,638,306
				3,123,545
Kansas – 0.4%
	1,865,000	Wyandotte County
		Kansas Revenue, 5.00%,
		09/01/2019 (Insured
		by BHAC)		2,110,359
Louisiana – 2.2%
	400,000	Houma-Terrebonne Public
		Trust Financing Authority,
		7.30%, 04/01/2010 (ETM)		419,712

The accompanying notes are an integral part of these financial statements.

Page 39

Baird Intermediate Municipal Bond Fund

Schedule of Investments       June 30, 2009 (Unaudited)

Principal
Amount			Value
MUNICIPAL BONDS – 92.3% (cont.)
Louisiana – 2.2% (cont.)
$	1,000,000	Houma-Terrebonne
		Public Trust Financing
		Authority Single Family
		Mortgage Revenue, 7.30%,
		04/01/2011 (ETM)	$	1,106,120
	1,450,000	Jefferson Parish Louisiana
		Home Mortgage
		Authority, 7.10%,
		08/01/2010 (ETM)		1,551,457
	7,355,000	Louisiana Public Facilities
		Authority Revenue, 5.50%,
		05/15/2032 (Pre-refunded
		to 05/15/2026)		8,025,408
				11,102,697
Massachusetts – 2.1%
	5,745,000	Massachusetts State,
		5.00%, 08/01/2020
		(Pre-refunded to
		08/01/2016)		6,626,053
	1,000,000	Massachusetts State
		Obligations Tax Revenue,
		5.25%, 01/01/2026
		(Pre-refunded to
		01/01/2014)		1,110,630
	2,200,000	Massachusetts State Water
		Resources Authority, 6.50%,
		07/15/2019 (ETM)		2,663,672
				10,400,355
Michigan – 3.3%
	1,550,000	Clarkston Michigan
		Community Schools,
		5.00%, 05/01/2013
		(Insured by FSA)		1,661,026
	1,000,000	Cornell Twp Michigan
		Economic Development
		Revenue, 5.875%,
		05/01/2018 (Pre-refunded
		to 05/01/2012)		1,119,430
	1,000,000	Detroit Michigan City
		School District,
		5.00%, 05/01/2016
		(Insured by FSA)		1,019,640
	2,185,000	Detroit Michigan Sewer
		Disposal Revenue, 5.00%,
		07/01/2030 (Pre-refunded
		to 07/01/2015)		2,486,945
	1,550,000	Harper Creek Michigan
		Community School District,
		5.00%, 05/01/2016
		(Insured by FSA)		1,656,222
	1,390,000	Jenison Michigan
		Public Schools,
		5.25%, 05/01/2015
		(Insured by NPFGC)		1,526,985
	3,000,000	Livonia Michigan Public
		Schools School District,
		5.00%, 05/01/2022
		(Insured by NPFGC)		3,001,050
	4,000,000	Michigan State Housing
		Development Authority,
		4.75%, 06/01/2016		4,011,520
				16,482,818
Minnesota – 1.0%
	1,040,000	Centennial Independent
		School District No. 12
		Minnesota, 5.00%,
		02/01/2014 (Pre-refunded
		to 02/01/2012,
		FSA Insured)		1,112,883

The accompanying notes are an integral part of these financial statements.

Page 40

Baird Intermediate Municipal Bond Fund

Schedule of Investments       June 30, 2009 (Unaudited)

Principal
Amount			Value
MUNICIPAL BONDS – 92.3% (cont.)
Minnesota – 1.0% (cont.)
$	1,215,000	Robbinsdale Independent
		School District No. 281,
		5.00%, 07/01/2020
		(Pre-refunded to
		02/01/2012,
		FSA Insured)	$	1,300,147
	2,225,000	Western Minnesota
		Municipal Power
		Agency, 6.375%,
		01/01/2016 (ETM)		2,530,181
				4,943,211
Mississippi – 0.6%
	1,110,000	Mississippi Development
		Bank Special Obligations,
		5.25%, 10/01/2030
		(Pre-refunded to
		10/01/2015)		1,273,470
	850,000	Mississippi Housing
		Financial Corporation,
		0.00%, 06/01/2015
		(ETM) ^		715,071
	1,000,000	Mississippi State, 5.00%,
		11/01/2021 (Pre-refunded
		to 11/01/2012)		1,106,050
				3,094,591
Missouri – 0.5%
	2,000,000	St. Louis County
		Industrial Development
		Authority, 6.625%,
		11/15/2035 (Pre-refunded
		to 11/15/2013)		2,398,060
Nebraska – 2.5%
	1,640,000	Nebraska Public Power
		District Revenue, 5.00%,
		01/01/2015 (Insured
		by NPFGC)		1,755,899
	9,150,000	Omaha Nebraska Public
		Electric Power District
		Revenue, 6.20%,
		02/01/2017 (ETM)		10,833,325
				12,589,224
Nevada – 0.9%
	2,080,000	Las Vegas Clark County
		Nevada Library District,
		5.00%, 01/01/2017		2,153,486
	1,965,000	Reno Nevada Capital
		Improvement Revenue,
		5.50%, 06/01/2019
		(Pre-refunded to
		06/01/2012)		2,197,538
				4,351,024
New Jersey – 2.1%
		New Jersey Economic
		Development Authority
		Revenue Bonds:
	1,500,000	6.375%, 04/01/2018
		(Pre-refunded to
		05/15/2014)		1,762,800
	3,000,000	6.375%, 04/01/2031
		(Pre-refunded to
		05/15/2014)		3,525,600
	1,000,000	New Jersey State
		Transportation Trust
		Fund Authority, 6.00%,
		12/15/2017 (Pre-refunded
		to 12/15/2011)		1,117,460

The accompanying notes are an integral part of these financial statements.

Page 41

Baird Intermediate Municipal Bond Fund

Schedule of Investments       June 30, 2009 (Unaudited)

Principal
Amount			Value
MUNICIPAL BONDS – 92.3% (cont.)
New Jersey – 2.1% (cont.)
		New Jersey State Turnpike
		Authority: (ETM)
$	1,500,000	6.50%, 01/01/2016	$	1,763,295
	130,000	6.50%, 01/01/2016		152,182
	2,000,000	Tobacco Settlement
		Financing Corporation,
		6.25%, 06/01/2043
		(Pre-refunded to
		06/01/2013)		2,341,360
				10,662,697
New Mexico – 0.2%
	1,000,000	New Mexico State Hospital
		Equipment Loan Council
		Hospital Revenue, 5.25%,
		07/01/2025 (Pre-refunded
		to 07/01/2015)		1,128,290
New York – 2.3%
	4,730,000	New York City, New York
		Transitional Financial
		Authority Building Aid
		Revenue Bonds,
		5.00%, 01/15/2015
		(Insured by FSA)		5,076,189
	2,000,000	New York State Dormitory
		Authority and Personal
		Income Tax Revenue,
		5.00%, 12/15/2017		2,214,500
	1,800,000	New York State University
		Dormitory Authority
		Revenue, 5.50%, 05/15/2013
		(Insured by NPFGC)		1,930,446
		New York, New York:
	1,000,000	5.00%, 03/01/2016
		(FGIC Insured)		1,070,980
	1,125,000	5.25%, 08/15/2021		1,185,705
	190,000	TSASC Inc. New York,
		4.75%, 06/01/2022		163,248
				11,641,068
North Carolina – 3.1%
		North Carolina Eastern
		Municipal Power Agency
		Power Systems Revenue:
		(ETM)
	2,370,000	5.00%, 01/01/2017		2,644,612
	225,000	6.40%, 01/01/2021		272,842
	4,900,000	4.50%, 01/01/2024
		(Pre-refunded to
		01/01/2022)		5,249,713
	6,495,000	North Carolina Medical
		Care Community Hospital
		Revenue, 5.25%,
		11/01/2029 (Pre-refunded
		to 11/01/2014)		7,242,120
				15,409,287
Ohio – 0.7%
	1,000,000	Akron Ohio Community
		Learning Center Income
		Tax Revenue, 5.25%,
		12/01/2016 (Insured
		by NPFGC)		1,039,320
	2,000,000	Cincinnati Ohio City
		School District,
		5.00%, 12/01/2016
		(Insured by FSA)		2,213,320
	130,000	Miamisburg Ohio Water
		Revenue, 7.00%,
		11/15/2016 (ETM)		151,804
				3,404,444

The accompanying notes are an integral part of these financial statements.

Page 42

Baird Intermediate Municipal Bond Fund

Schedule of Investments       June 30, 2009 (Unaudited)

Principal
Amount			Value
MUNICIPAL BONDS – 92.3% (cont.)
Oklahoma – 0.5%
$	2,360,000	Tulsa County Oklahoma
		Home Financing Authority
		Single Family Mortgage
		Revenue, 6.90%,
		08/01/2011 (ETM)	$	2,641,359
Pennsylvania – 6.1%
	1,275,000	Central Dauphin
		Pennsylvania School
		District, 6.75%,
		02/01/2024 (Pre-refunded
		to 02/01/2016)		1,587,388
	6,570,000	Pennsylvania Convention
		Center Authority Revenue
		Bonds, 6.00%,
		09/01/2019 (ETM)		7,757,856
	3,390,000	Pennsylvania State Higher
		Education Facilities
		Authority Revenue, 5.00%,
		01/01/2029 (Pre-refunded
		to 01/01/2013)		3,771,951
	3,000,000	Pennsylvania State Public
		School Building Authority
		Lease Revenue, 5.00%,
		11/15/2034 (Pre-refunded
		to 11/15/2014)		3,389,910
	1,790,000	Philadelphia Pennsylvania
		Authority For Industrial
		Development Revenue,
		5.25%, 01/01/2027
		(Pre-refunded to
		01/01/2017)		2,060,845
	3,350,000	Philadelphia Pennsylvania
		Gas Works, 7.00%,
		05/15/2020 (ETM)		4,027,001
		Pittsburgh Pennsylvania
		Water & Sewer Authority
		Revenue Bonds:
	1,025,000	7.25%, 09/01/2014
		(ETM)		1,168,992
	4,500,000	5.00%, 09/01/2029
		(Pre-refunded to
		09/01/2015)		5,055,840
	1,500,000	St. Mary Hospital
		Authority Pennsylvania
		Health Revenue, 5.375%,
		11/15/2034 (Pre-refunded
		to 11/15/2014)		1,727,145
				30,546,928
Puerto Rico – 0.3%
	1,080,000	Puerto Rico Public Finance
		Corporation, 6.00%,
		08/01/2026 (ETM)		1,277,240
South Carolina – 1.9%
	285,000	Greenville South
		Carolina Waterworks
		Revenue, 7.00%,
		02/01/2010 (ETM)		295,722
	4,500,000	Lexington County South
		Carolina Health Services
		District Hospital Revenue,
		5.50%, 11/01/2032
		(Pre-refunded to
		11/01/2013)		5,178,735
	3,800,000	South Carolina Jobs
		Economic Development
		Authority Hospital
		Facilities Revenue, 7.375%,
		12/15/2021 (Pre-refunded
		to 12/15/2010)		4,169,550
				9,644,007

The accompanying notes are an integral part of these financial statements.

Page 43

Baird Intermediate Municipal Bond Fund

Schedule of Investments       June 30, 2009 (Unaudited)

Principal
Amount			Value
MUNICIPAL BONDS – 92.3% (cont.)
South Dakota – 0.3%
$	1,175,000	Heartland Consumers
		Power District, 7.00%,
		01/01/2016 (ETM)	$	1,380,742
Tennessee – 1.6%
	230,000	Metropolitan Government
		Nashville & Davidson County
		Tennessee H&E, 6.10%,
		07/01/2010 (ETM)		234,878
	1,545,000	Metropolitan Government
		Nashville & Davidson
		County Tennessee Water
		& Sewer Revenue, 6.50%,
		12/01/2014 (ETM)		1,886,044
	5,000,000	Shelby County Tennessee
		Health Educational &
		Housing Facilities
		Revenue, 5.50%,
		08/15/2019 (ETM)		5,635,300
				7,756,222
Texas – 16.4%
	1,125,000	Barbers Hill Texas
		Independent School
		District General Obligation,
		5.00%, 02/15/2017
		(PSF Guaranteed)		1,236,049
	6,060,000	Capital Area Housing
		Finance Corporation
		Texas, 0.00%,
		01/01/2016 (ETM) ^		4,929,083
	1,500,000	Central Texas Housing
		Finance Corporation, 0.00%,
		09/01/2016 (ETM) ^		1,177,755
	1,000,000	Copperas Cove Texas
		Independent School District,
		5.00%, 08/15/2016
		(PSF Guaranteed)		1,119,130
	1,500,000	Cypress-Fairbanks Texas
		Independent School District,
		5.00%, 02/15/2017
		(PSF Guaranteed)		1,662,450
	1,355,000	El Paso Texas Waterworks
		& Sewer Revenue,
		5.00%, 08/15/2018		1,506,719
	1,625,000	Frisco Texas Independent
		School District,
		6.00%, 08/15/2018
		(PSF Guaranteed)		1,898,666
	1,000,000	Georgetown Texas
		Independent School
		District, 5.00%,
		02/15/2016
		(PSF Guaranteed)		1,110,130
	2,000,000	Harris County Texas,
		5.25%, 10/01/2017
		(Pre-refunded to
		10/01/2013)		2,284,540
		Harris County Texas
		Health Facilities
		Development Corporation
		Hospital Revenue: (ETM)
	8,000,000	5.50%, 10/01/2013		8,844,640
	1,720,000	5.50%, 10/01/2019		1,991,622
	7,250,000	Houston Texas Health
		Facilities Corporate
		Facilities Revenue,
		7.125%, 02/15/2034
		(Pre-refunded to
		02/15/2014)		8,723,200

The accompanying notes are an integral part of these financial statements.

Page 44

Baird Intermediate Municipal Bond Fund

Schedule of Investments       June 30, 2009 (Unaudited)

Principal
Amount			Value
MUNICIPAL BONDS – 92.3% (cont.)
Texas – 16.4% (cont.)
$	1,920,000	Houston Texas Sewer
		System Revenue, 9.375%,
		10/01/2013 (ETM)	$	2,246,650
	1,315,000	La Porte Texas
		Independent
		School District,
		5.00%, 02/15/2018
		(Insured by NPFGC)		1,420,174
	1,735,000	Lufkin Texas Independent
		School District,
		5.00%, 08/15/2015
		(PSF Guaranteed)		1,929,424
	1,050,000	Magnolia Texas
		Independent School
		District, 5.00%,
		08/15/2016
		(PSF Guaranteed)		1,189,965
	1,265,000	Mission Consolidation
		Independent School
		District, 5.00%,
		02/15/2019
		(PSF Guaranteed)		1,355,498
	1,125,000	North Central Texas
		Health Facilities Revenue,
		5.75%, 02/15/2015 (ETM)		1,283,569
	1,210,000	Pearland Texas Waterworks
		& Sewage, 5.25%,
		03/01/2023 (Pre-refunded
		to 03/01/2014)		1,379,811
	1,295,000	Rockwall Texas Independent
		School District, 5.00%,
		02/15/2015
		(PSF Guaranteed)		1,461,239
	775,000	Sam Rayburn Texas
		Municipal Power Agency,
		6.00%, 09/01/2010 (ETM)		795,615
	11,565,000	San Antonio Texas Electric
		& Gas Revenue, 5.65%,
		02/01/2019 (ETM)		13,477,273
	2,100,000	San Antonio Texas Hotel
		Occupancy Tax Revenue
		Bonds, 0.00%,
		08/15/2015 (ETM) ^		1,761,333
	2,000,000	San Antonio Texas
		Independent School District,
		5.00%, 08/15/2017
		(PSF Guaranteed)		2,213,440
	575,000	Socorro Texas Independent
		School District,
		5.25%, 08/15/2012
		(PSF Guaranteed)		639,866
	1,000,000	Spring Texas Independent
		School District,
		5.00%, 08/15/2019
		(PSF Guaranteed)		1,116,090
	7,750,000	Tarrant County Texas
		Health Facilities Revenue,
		6.00%, 09/01/2024 (ETM)		9,168,792
	835,000	Tarrant County Texas
		Housing Finance
		Corporation Revenue
		Bonds, 0.00%,
		09/15/2016 (ETM) ^		654,757
	265,000	Texas Public Building
		Authority Revenue, 7.125%,
		08/01/2011 (ETM)		280,060
	1,900,000	Trinity River Authority
		Texas Revenue, 5.50%,
		02/01/2021 (Pre-refunded
		to 02/01/2013, Insured
		by NPFGC)		2,151,826

The accompanying notes are an integral part of these financial statements.

Page 45

Baird Intermediate Municipal Bond Fund

Schedule of Investments       June 30, 2009 (Unaudited)

Principal
Amount			Value
MUNICIPAL BONDS – 92.3% (cont.)
Texas – 16.4% (cont.)
$	1,000,000	University of Houston Texas,
		5.25%, 02/15/2012
		(FSA Insured)	$	1,099,070
				82,108,436
Utah – 0.1%
	470,000	Salt Lake City Utah
		Hospital Revenue,
		8.125%, 05/15/2015
		(ETM)		544,937
Virginia – 1.0%
	1,095,000	Bristol Virginia Utility
		Systems General
		Obligations, 5.50%,
		11/01/2018 (ETM)		1,261,396
	3,165,000	Tobacco Settlement
		Financing Corporation
		Revenue, 5.625%,
		06/01/2037 (Pre-refunded
		to 06/01/2015)		3,629,717
				4,891,113
Washington – 0.2%
	1,000,000	Snohomish County
		Washington Public Utilities
		Revenue, 6.80%,
		01/01/2020 (ETM,
		Insured by NPFGC)		1,212,610
West Virginia – 1.3%
	7,365,000	Berkeley Brooke Fayette
		Counties West Virginia
		Single Family Mortgage
		Revenue, 0.00%,
		12/01/2014 (ETM) ^		6,287,206
Wisconsin – 2.9%
	7,390,000	Badger Tobacco Asset
		Securitization Corporation
		Wisconsin, 6.375%,
		06/01/2032 (Pre-refunded
		to 06/01/2012)		8,259,434
	3,000,000	Ladysmith-Hawkins
		Wisconsin School District
		General Obligation,
		5.20%, 04/01/2018
		(Insured by NPFGC)		2,946,120
	3,320,000	Wisconsin State Health
		& Educational
		Facilities Revenue,
		5.00%, 12/01/2019
		(Insured by NPFGC)		3,329,196
				14,534,750
		Total Municipal Bonds
		(Cost $453,248,331)		462,180,570
Shares
SHORT-TERM INVESTMENTS – 6.0%
Money Market Fund – 6.0%
	30,060,494	Fidelity Institutional
		Tax-Exempt Portfolio,		30,060,494
		Total Short-Term
		Investments
		(Cost $30,060,494)		30,060,494
		Total Investments
		(Cost $483,308,825) –
		98.3%		492,241,064
		Other Assets in Excess
		of Liabilities – 1.7%		8,658,007
		TOTAL NET
		ASSETS – 100.0%	$	500,899,071

ETM – Escrowed to Maturity

^ Non-Income Producing

The accompanying notes are an integral part of these financial statements.

Page 46

Baird Intermediate Municipal Bond Fund

Schedule of Investments       June 30, 2009 (Unaudited)

SFAS 157 – Summary of Fair Value Exposure at June 30, 2009

As adopted by the Fund, the Financial Accounting Standards Board issued Statement of Financial Accounting Standards No. 157, “Fair Value Measurements” (“SFAS 157”) defines fair value, establishes a framework for measuring fair value in generally accepted accounting principles (GAAP), and expands disclosures about fair value measurements.  Under SFAS 157, various inputs are used in determining the value of the Fund’s investments.  These inputs are summarized into three broad levels and described below:

Level 1 –	Quoted prices in active markets for identical securities.
Level 2 –	Other significant observable inputs (including quoted prices for similar securities, quoted prices for identical securities in inactive markets, dealer indications, interest rates, yield curves, benchmark yields, issuer spreads, prepayment speeds, cash flows, credit risk, default rates, information about issuers, sectors and markets, inputs corroborated by observable market data, etc.)
Level 3 –	Significant unobservable inputs (including the Fund’s own assumptions about the assumptions that market participants would use in pricing the security).

The inputs or methodology used for valuing securities are not necessarily an indication of the risk associated with investing in those securities.

The following is a summary of the inputs used to value the Fund’s investments as of June 30, 2009:

	Level 1		Level 2		Level 3		Total
Fixed Income
Municipal Bonds	$	—	$	462,180,570	$	—	$	462,180,570
Total Fixed Income		—		462,180,570		—		462,180,570
Short-Term Investments
Money Market Mutual Funds		30,060,494		—		—		30,060,494
Total Short-Term Investments		30,060,494		—		—		30,060,494
Total Investments in Securities	$	30,060,494	$	462,180,570	$	—	$	492,241,064

Page 47

Baird Aggregate Bond Fund

June 30, 2009

The Baird Aggregate Bond Fund seeks an annual rate of total return, before Fund expenses, greater than the annual rate of total return of the Barclays Capital U.S. Aggregate Bond Index.  The Barclays Capital U.S. Aggregate Bond Index is an unmanaged, market value weighted index of investment grade, fixed-rate debt issues, including government, corporate, asset-backed and mortgage-backed securities, with maturities of at least one year.

Portfolio Characteristics

Quality Distribution*	Sector Weightings*

Net Assets:	$986,318,048	Annualized Expense Ratio:
SEC 30-Day Yield:**		Institutional Class:	0.30	%
Institutional Class:	5.95%	Investor Class:	0.55	%***
Investor Class:	5.72%	Portfolio Turnover Rate:	21.2	%%#
Average Effective Duration:	4.30 years	Total Number of Holdings:	414
Average Effective Maturity:	6.35 years

* Percentages shown are based on the Fund’s total net assets.

** SEC yields are based on SEC guidelines and are calculated for the 30 days ended June 30, 2009.

*** Includes 0.25% 12b-1 fee.

# Not annualized.

Page 48

Baird Aggregate Bond Fund

Average Annual Total Returns

			Since
For the Periods Ended June 30, 2009	One Year	Five Years	Inception(1)
Institutional Class Shares	1.90%	3.91%	5.66%
Investor Class Shares	1.50%	3.62%	5.41%
Barclays Capital U.S. Aggregate Bond Index(2)	6.05%	5.01%	5.96%

(1) For the period from September 29, 2000 (commencement of operations) through June 30, 2009.

(2) The Barclays Capital U.S. Aggregate Bond Index is an unmanaged, market value weighted index of investment grade, fixed-rate debt issues, including government, corporate, asset-backed, and mortgage-backed securities, with maturities of at least one year.  This index does not reflect any deduction for fees, expenses or taxes.  A direct investment in an index is not possible.

The returns shown in the table above reflect reinvestment of dividends and/or capital gains distributions in additional shares.  The returns do not reflect the deduction of taxes that a shareholder would pay on Fund distributions or the redemption of Fund shares.

Past performance does not guarantee future results.  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.

For information about the performance of the Fund as of the most recent month-end, please call 1-866-44BAIRD or visit www.bairdfunds.com.  Mutual fund performance changes over time and current performance may be lower or higher than that stated.

Page 49

Baird Aggregate Bond Fund

Schedule of Investments       June 30, 2009 (Unaudited)

Principal
Amount			Value
LONG-TERM INVESTMENTS – 95.8%
Asset Backed Securities – 5.3%
$	8,000,000	American Express Credit
		Account Master Trust,
		Series 2005-5, Class A,
		4.276%, 02/15/2013	$	7,930,857
		Bayview Financial
		Acquisition Trust:
	2,000,000	Series 2006-A, Class 1A2,
		5.483%, 02/28/2041		1,448,729
	5,000,000	Series 2007-B, Class 1A2,
		6.831%, 08/28/2047		2,016,595
	1,525,000	Chase Issuance Trust,
		Series 2005-A10, Class
		A10, 4.65%, 12/17/2012		1,574,765
		Contimortgage Home
		Equity Trust:
	1,073	Series 1997-2, Class A9,
		7.09%, 04/15/2028		995
	5,955	Series 1999-3, Class A8,
		5.884%, 05/25/2029		5,876
		Countrywide
		Asset-Backed Certificates:
	4,004,824	Series 2006-S2, Class A2,
		5.627%, 07/25/2027		2,822,246
	1,693,429	Series 2005-17,
		Class 1AF2, 5.363%,
		03/25/2030		1,230,850
	1,424,534	Series 2004-15,
		Class AF6, 4.613%,
		04/25/2035		851,604
	4,772,765	Series 2005-1, Class AF6,
		5.03%, 07/25/2035		3,160,232
	4,905,016	Series 2005-10,
		Class AF6, 4.915%,
		02/25/2036		2,658,768
	1,975,697	Series 2005-17,
		Class 1AF5, 5.564%,
		05/25/2036		972,849
	2,715,504	Series 2007-S1,
		Class A6,
		5.693%, 11/25/2036		1,086,239
	7,000,000	Series 2006-13,
		Class 1AF2, 5.884%,
		01/25/2037		5,545,994
	1,500,000	Series 2006-10,
		Class 1AF3, 5.971%,
		09/25/2046		728,587
	922,841	Credit Based Asset
		Servicing and Securities,
		Series 2005-CB8,
		Class AF2, 5.303%,
		12/25/2035		819,555
		Discover Card
		Master Trust I:
	1,700,000	Series 2004-2, Class A2,
		4.31%, 05/15/2012		1,696,536
	2,000,000	Series 2003-4, Class A2,
		1.32%, 05/15/2013		1,964,635
	239,585	Equivantage Home
		Equity Loan Trust,
		Series 1996-3, Class A3,
		7.70%, 09/25/2027		192,199
		GE Capital Mortgage
		Services, Inc.:
	2,205	Series 1997-HE4,
		Class A7, 6.735%,
		12/25/2028		2,179
	31,795	Series 1999-HE1,
		Class A7, 6.265%,
		04/25/2029		28,243

The accompanying notes are an integral part of these financial statements.

Page 50

Baird Aggregate Bond Fund

Schedule of Investments       June 30, 2009 (Unaudited)

Principal
Amount			Value
LONG-TERM INVESTMENTS – 95.8% (cont.)
Asset Backed Securities – 5.3% (cont.)
$	59,675	GMAC Mortgage
		Corporation Loan Trust,
		Series 2004-GH1,
		Class A2, 4.39%,
		12/25/2025	$	56,746
		Green Tree Financial
		Corporation:
	1,022,787	Series 1993-3, Class A7,
		6.40%, 10/15/2018		945,822
	765,374	Series 1993-4, Class A5,
		7.05%, 01/15/2019		711,667
	1,937,083	Series 1998-2, Class A5,
		6.24%, 12/01/2028		1,688,279
	129,080	Series 1997-6, Class A8,
		7.07%, 01/15/2029		121,269
	1,584,938	Series 1998-3, Class A5,
		6.22%, 03/01/2030		1,271,529
	960,438	Series 1998-4, Class A5,
		6.18%, 04/01/2030		773,912
	1,079,725	GSAA Home Equity
		Trust, Series 2005-1,
		Class AF2, 4.316%,
		11/25/2034		993,477
	98,707	IMC Home Equity Loan
		Trust, Series 1997-5,
		Class A10, 5.749%,
		11/20/2028		91,984
	212,125	Impac CMB Trust,
		Series 2004-4, Class 2A2,
		5.249%, 09/25/2034		157,622
	3,200,000	MBNA Master Credit
		Card Trust, Series
		2005-4A, Class A4,
		3.38%, 11/15/2012		3,170,740
	92,562	Oakwood Mortgage
		Investors, Inc.,
		Series 1999-B, Class A3,
		6.45%, 11/15/2017		56,463
	1,098,651	RAAC Series,
		Series 2004-SP1,
		Class AI4, 5.285%,
		08/25/2027		915,498
	3,000,000	Renaissance Home
		Equity Loan Trust,
		Series 2007-1, Class AF3,
		5.612%, 04/25/2037		815,696
		Residential Asset
		Mortgage Products, Inc.:
	1,293,708	Series 2003-RS7,
		Class AI6, 5.34%,
		08/25/2033		1,012,948
	899,604	Series 2005-RS1,
		Class AI6, 4.713%,
		01/25/2035		631,931
		Residential Asset
		Securities Corporation:
	256,865	Series 2003-KS5,
		Class AI6, 3.62%,
		07/25/2033		142,941
	256,283	Series 2004-KS2,
		Class AI6, 4.30%,
		03/25/2034		179,955
	2,600,000	Stingray Pass-Thru
		Certificates, Series 2005,
		5.902%, 01/12/2015
		(Acquired 05/10/2007
		and 09/19/2007; Cost
		$1,538,444 and
		$815,411,
		respectively) # **		1,300,000

The accompanying notes are an integral part of these financial statements.

Page 51

Baird Aggregate Bond Fund

Schedule of Investments       June 30, 2009 (Unaudited)

Principal
Amount			Value
LONG-TERM INVESTMENTS – 95.8% (cont.)
Asset Backed Securities – 5.3% (cont.)
$	1,410,695	Structured Asset
		Securities Corporation,
		Series 2005-7XS,
		Class 1A4B, 5.44%,
		04/25/2035	$	801,483
				52,578,495
Financial – 16.6%
	2,450,000	American Express Credit
		Corporation, Series C,
		7.30%, 08/20/2013		2,547,287
		American General Finance
		Corporation Senior Notes:
	1,250,000	8.45%, 10/15/2009		1,201,986
	1,150,000	4.875%, 05/15/2010		967,569
	1,000,000	5.85%, 06/01/2013		573,639
	500,000	6.90%, 12/15/2017		270,741
	1,000,000	American International
		Group, 8.175%,
		05/15/2058 (Callable
		05/15/2038) (Acquired
		05/13/2008; Cost
		$1,000,000)*		285,296
	2,000,000	Ameriprise Financial, Inc.
		7.30%, 06/28/2019		2,046,618
	250,000	AmSouth Bancorporation
		Subordinated Debentures,
		6.75%, 11/01/2025		169,859
	2,330,000	Axa Financial, Inc.,
		7.75%, 08/01/2010		2,336,410
	300,000	BAC Capital Trust VI,
		5.625%, 03/08/2035		195,817
	1,265,000	Bank of America
		Corporation
		Subordinated Notes,
		10.20%, 07/15/2015		1,322,990
	2,435,000	Bank of Tokyo-
		Mitsubishi/UFJ NY,
		7.40%, 06/15/2011 f		2,505,474
	929,000	Bank One Corporation
		Subordinated Notes,
		10.00%, 08/15/2010		987,962
	2,175,000	Banponce Trust I, Series A,
		8.327%, 02/01/2027
		(Callable 09/08/2009)		1,278,828
	2,500,000	Barclays Bank Plc,
		6.75%, 05/22/2019 f		2,479,430
	2,400,000	Bear Stearns Cos.,
		Inc., Series B,
		6.95%, 08/10/2012		2,608,450
	1,500,000	BOI Capital Funding II,
		5.571%, 02/01/2016
		(Acquired 09/03/2008;
		Cost $990,386) * f		562,500
	2,000,000	BOI Capital Funding III,
		6.107%, 02/04/2016 f		750,000
	2,000,000	Capmark Financial
		Group, Inc.,
		6.30%, 05/10/2017		471,630
	2,967,000	CIT Group Funding
		Company of Canada,
		5.20%, 06/01/2015 f		1,718,750
		CIT Group, Inc.:
	500,000	5.40%, 01/30/2016		282,334
	1,670,000	6.10%, 03/15/2067
		(Callable 03/15/2017)		633,414
	2,000,000	Citigroup Capital XXI,
		8.30%, 12/21/2057
		(Callable 12/21/2037)		1,559,650
	1,000,000	Citigroup, Inc.,
		5.50%, 04/11/2013		937,245

The accompanying notes are an integral part of these financial statements.

Page 52

Baird Aggregate Bond Fund

Schedule of Investments       June 30, 2009 (Unaudited)

Principal
Amount			Value
LONG-TERM INVESTMENTS – 95.8% (cont.)
Financial – 16.6% (cont.)
$	1,281,000	Compass Bank
		Subordinated Notes,
		8.10%, 08/15/2009	$	1,279,985
		Corp Andina
		De Fomento Notes: f
	675,000	7.375%, 01/18/2011		706,377
	340,000	5.75%, 01/12/2017		327,538
	3,575,000	Countrywide Financial
		Corporation Subordinated
		Notes, 6.25%, 05/15/2016		3,171,651
	1,000,000	Credit Agricole S.A.,
		6.637%, 05/29/2049
		(Acquired 05/23/2007;
		Cost $1,000,000) * f		587,500
	330,000	Deutsche Bank Trust
		Corporation Subordinated
		Notes, 7.25%, 10/15/2011		347,953
	3,500,000	Fifth Third Bank,
		4.20%, 02/23/2010		3,497,438
	3,135,000	First Empire Capital Trust
		I, 8.234%, 02/01/2027
		(Callable 09/08/2009)		2,067,263
	1,575,000	First Empire Capital Trust II,
		8.277%, 06/01/2027
		(Callable 09/08/2009)		1,040,469
	3,500,000	First Hawaiian Capital
		Trust I, Series B,
		8.343%, 07/01/2027
		(Callable 09/08/2009)		2,673,853
	686,508	First National Bank of
		Chicago Pass-Thru
		Certificates, Series 1993-A,
		8.08%, 01/05/2018		757,259
	4,475,000	First National
		Bank of Omaha
		Subordinated Notes,
		7.32%, 12/01/2010		4,393,640
	1,748,000	First Union Capital I,
		Series A, 7.935%,
		01/15/2027 (Callable
		09/08/2009)		1,583,456
	5,107,000	First Union
		Institutional Capital I,
		8.04%, 12/01/2026
		(Callable 09/08/2009)		4,211,569
	1,460,000	First Union
		Institutional Capital II,
		7.85%, 01/01/2027
		(Callable 09/08/2009)		1,181,346
	2,500,000	Fleet Capital Trust II,
		7.92%, 12/11/2026
		(Callable 09/08/2009)		2,049,805
	2,300,000	FMR LLC Notes,
		4.75%, 03/01/2013
		(Acquired 02/26/2003 –
		12/21/2007; Aggregate
		Cost $2,236,498) *		2,162,253
	1,000,000	GE Global Insurance
		Holding Corporation.,
		7.50%, 06/15/2010		997,787
		General Electric
		Capital Corporation:
	2,030,000	5.50%, 11/15/2011
		(Callable 11/15/2009)		2,035,018
	889,000	1.146%, 08/02/2012		805,422
	1,100,000	5.90%, 05/13/2014		1,122,727

The accompanying notes are an integral part of these financial statements.

Page 53

Baird Aggregate Bond Fund

Schedule of Investments       June 30, 2009 (Unaudited)

Principal
Amount			Value
LONG-TERM INVESTMENTS – 95.8% (cont.)
Financial – 16.6% (cont.)
$	2,175,000	Glencore Funding LLC,
		6.00%, 04/15/2014
		(Acquired 03/31/2004 –
		06/19/2008; Aggregate
		Cost $2,123,673) *	$	1,796,354
		GMAC LLC:
	100,000	7.25%, 03/02/2011		90,736
	336,000	7.50%, 12/31/2013
		(Acquired 06/21/2005 –
		10/17/2007; Aggregate
		Cost $1,148,100) *		260,400
	150,000	6.75%, 12/01/2014		115,316
	403,000	8.00%, 12/31/2018
		(Acquired 06/21/2005 –
		10/17/2007; Aggregate
		Cost $1,471,986) *		255,905
	1,180,000	Goldman Sachs Capital I,
		6.345%, 02/15/2034		951,974
	1,000,000	Goldman Sachs Group Inc.,
		7.50%, 02/15/2019		1,070,772
	500,000	Goldman Sachs Group LP,
		8.00%, 03/01/2013
		(Acquired 01/05/2009;
		Cost $500,000) *		541,524
	2,800,000	Great West Life &
		Annuity Insurance,
		7.153%, 05/16/2046
		(Acquired 05/16/2006
		and 11/08/2007;
		Cost $1,000,000 and
		$1,783,656, respectively) *		2,156,000
	2,200,000	Hartford Financial
		Services Group Inc.,
		8.125%, 06/15/2068
		(Callable 06/15/2018)		1,540,000
	950,000	HSBC Bank PLC
		Subordinated Notes,
		6.95%, 03/15/2011 f		975,904
	2,100,000	HSBC Holdings PLC
		Subordinated Notes,
		6.50%, 09/15/2037 f		2,031,357
	400,000	HSBC USA
		Capital Trust I,
		7.808%, 12/15/2026
		(Callable 09/08/2009)
		(Acquired 03/08/2007;
		Cost $411,644) *		362,581
	500,000	HSBC USA Capital
		Trust II,
		8.38%, 05/15/2027
		(Callable 09/08/2009)
		(Acquired 11/06/2007;
		Cost $517,111) *		452,942
	3,150,000	Huntington National
		Bank Notes,
		8.00%, 04/01/2010		3,150,646
	2,300,000	ING Security Life
		Institutional Funding
		Senior Unsecured Notes,
		1.321%, 01/15/2010
		(Acquired 04/27/2009;
		Cost $2,227,555) *		2,302,482
		Invesco Ltd. Notes: f
	1,015,000	5.375%, 02/27/2013		887,480
	921,000	5.375%, 12/15/2014		714,560
	900,000	J.P. Morgan Chase &
		Company Notes,
		5.875%, 03/15/2035		720,000
	1,255,000	Jefferies Group Inc.,
		6.25%, 01/15/2036		865,791

The accompanying notes are an integral part of these financial statements.

Page 54

Baird Aggregate Bond Fund

Schedule of Investments       June 30, 2009 (Unaudited)

Principal
Amount			Value
LONG-TERM INVESTMENTS – 95.8% (cont.)
Financial – 16.6% (cont.)
$	1,250,000	Kaupthing Bank,
		5.75%, 10/04/2011
		(Acquired 06/06/2008
		and 07/22/2008;
		Cost $199,243
		and $769,803,
		respectively) * f	$	162,500
	3,400,000	Key Bank NA,
		7.413%, 05/06/2015		3,047,825
		Lehman Brothers
		Holdings, Inc. Notes: @
	750,000	8.50%, 08/01/2015		110,625
	1,425,000	6.50%, 07/19/2017		142
	2,500,000	Liberty Mutual Group,
		10.75%, 06/15/2088
		(Callable 06/15/2038)
		(Acquired 05/21/2008;
		Cost $2,445,125) *		1,800,000
	565,000	Liberty Mutual
		Insurance Company,
		7.697%, 10/15/2097
		(Acquired 03/26/2003;
		Cost $361,716) *		338,002
	1,125,000	Lincoln National
		Corporation,
		6.05%, 04/20/2067
		(Callable 04/20/2017)		714,375
		Marsh & McLennan
		Companies, Inc.:
	800,000	5.375%, 07/15/2014		778,806
	500,000	9.25%, 04/15/2019		562,659
	195,455	Marshall & Ilsley Bank
		Notes, 2.90%, 08/18/2009		193,840
	1,000,000	Massachusetts Mutual
		Life Insurance Company,
		8.875%, 06/01/2039
		(Acquired 05/27/2009;
		Cost $987,100) *		1,061,892
	800,000	MBIA Insurance Corp.,
		14.00%, 01/15/2033
		(Callable 01/15/2013)
		(Acquired 01/11/2008;
		Cost $800,000) *		304,000
		Merrill Lynch
		& Company:
	1,000,000	6.40%, 08/28/2017		885,260
	1,750,000	6.875%, 04/25/2018		1,619,723
	1,275,000	7.75%, 05/14/2038		1,184,354
	422,000	Metlife, Inc.,
		6.50%, 12/15/2032		406,581
	1,650,000	Metropolitan Life
		Global Funding I,
		2.189%, 05/17/2010
		(Acquired 12/31/2008
		and 04/23/2009; Cost
		$1,479,042 and $95,768,
		respectively) *		1,636,421
	3,444,000	The Mony Group, Inc.,
		8.35%, 03/15/2010		3,557,642
	2,000,000	Morgan Stanley,
		5.625%, 01/09/2012		2,046,814
	475,000	Morgan Stanley
		Subordinated Notes,
		4.75%, 04/01/2014		448,680
	510,000	National Bank of Hungary
		Yankee Debentures,
		8.875%, 11/01/2013 f		522,801

The accompanying notes are an integral part of these financial statements.

Page 55

Baird Aggregate Bond Fund

Schedule of Investments       June 30, 2009 (Unaudited)

Principal
Amount			Value
LONG-TERM INVESTMENTS – 95.8% (cont.)
Financial – 16.6% (cont.)
$	1,250,000	National City Bank
		of Cleveland
		Subordinated Notes,
		4.625%, 05/01/2013	$	1,193,090
	2,600,000	National City Bank of
		Kentucky Subordinated
		Notes, 6.30%, 02/15/2011		2,631,234
	1,750,000	National Westminster
		Bank Subordinated Notes,
		7.375%, 10/01/2009 f		1,730,916
	2,000,000	Nationwide Building
		Society, 4.25%,
		02/01/2010 (Acquired
		12/02/2008; Cost
		$1,970,004) * f		1,994,734
	4,921,000	Navigators Group Inc.
		Senior Unsecured Notes,
		7.00%, 05/01/2016		3,826,127
	4,334,000	NB Capital Trust IV,
		8.25%, 04/15/2027
		(Callable 09/08/2009)		3,639,225
	2,500,000	North Fork Capital Trust II,
		8.00%, 12/15/2027
		(Callable 09/08/2009)		1,814,818
	1,600,000	Pricoa Global Funding I,
		2.066%, 06/04/2010
		(Acquired 03/06/2009;
		Cost $1,483,827) *		1,586,346
	4,480,000	Principal Financial
		Group (AU) Senior Notes,
		8.20%, 08/15/2009
		(Acquired 3/10/2009;
		Cost $4,449,747) * f		4,498,319
	2,000,000	Principal Life
		Income Funding,
		1.128%, 07/17/2009		1,999,308
	4,750,000	Regions Financing
		Trust II,
		6.625%, 05/15/2047		3,040,000
	1,000,000	Republic New York
		Capital I,
		7.75%, 11/15/2026		889,390
	700,000	Republic New York
		Corporation Debentures,
		9.125%, 05/15/2021		665,970
	1,000,000	Santander
		Financial Issuances,
		6.375%, 02/15/2011 f		997,907
	2,000,000	Santander Perpetual,
		6.671%, 10/29/2049
		(Callable 10/24/2017) f		1,480,000
	8,760,000	Schwab Capital Trust I,
		7.50%, 11/15/2067
		(Callable 11/15/2017)		7,302,424
	500,000	SLM Corporation Notes,
		5.625%, 08/01/2033		307,839
		Sovereign Bancorp, Inc.:
	1,500,000	3.44%, 03/23/2010		1,384,305
	800,000	4.80%, 09/01/2010		781,436
	745,000	4.90%, 09/23/2010		727,678
	1,500,000	8.75%, 05/30/2018		1,475,256
	3,000,000	Sun Life Financial
		Global Funding,
		1.663%, 07/06/2010
		(Acquired 03/25/2009;
		Cost $2,819,695) *		2,911,542

The accompanying notes are an integral part of these financial statements.

Page 56

Baird Aggregate Bond Fund

Schedule of Investments       June 30, 2009 (Unaudited)

Principal
Amount			Value
LONG-TERM INVESTMENTS – 95.8% (cont.)
Financial – 16.6% (cont.)
$	1,000,000	Symetra Financial
		Corporation Senior Notes,
		6.125%, 04/01/2016
		(Acquired 03/23/2006;
		Cost $995,570) *	$	756,869
	2,400,000	Toll Road Inv.
		Partnership II,
		0.00%, 02/15/2011
		(Acquired 06/19/2008;
		Cost $2,118,833) * ^		2,156,251
	1,000,000	Travelers Companies, Inc.,
		6.75%, 06/20/2036		1,084,062
	560,000	UFJ Finance Aruba AEC,
		6.75%, 07/15/2013 f		579,848
	301,000	United Mexican
		States Notes,
		6.75%, 09/27/2034 f		303,559
	650,000	Washington Mutual
		Preferred Funding Trust I,
		6.534%, 03/29/2049
		(Callable 03/15/2011)
		(Acquired 07/31/2007;
		Cost $606,756) * @		8,125
	2,788,000	Westdeutsche Landesbank
		Subordinated Notes,
		4.796%, 07/15/2015		2,906,975
	750,000	Willis North America Inc.,
		5.625%, 07/15/2015		658,227
				163,651,634
Industrial – 12.7%
		Ameritech Capital
		Funding Debentures:
	2,236,691	9.10%, 06/01/2016		2,267,734
	1,500,000	6.45%, 01/15/2018		1,597,638
	2,000,000	Anglo American Capital
		PLC, 9.375%, 04/08/2019
		(Acquired 04/02/2009;
		Cost $2,000,000) * f		2,160,000
	2,765,000	British Sky Broadcasting
		Group PLC,
		8.20%, 07/15/2009 f		2,766,631
		British Telecom
		PLC Notes: f
	2,575,000	8.625%, 12/15/2010		2,734,835
	600,000	9.125%, 12/15/2030		665,195
	600,000	Bunge Limited Finance
		Corporation Notes,
		5.35%, 04/15/2014		583,795
	3,000,000	Bunge NA Finance LP
		5.90%, 04/01/2017		2,745,744
	1,000,000	Canadian National
		Resources,
		6.25%, 03/15/2038 f		998,164
	800,000	Clear Channel
		Communications Senior
		Unsubordinated Notes,
		5.50%, 12/15/2016		174,000
	680,000	Comcast-Cable Holdings,
		7.875%, 08/01/2013		773,682
	1,000,000	Comcast Corporation,
		6.95%, 08/15/2037		1,042,679
	825,000	Comcast Holdings
		Corporation,
		10.625%, 07/15/2012		965,250
	5,000,000	Computer Sciences
		Corporation,
		7.375%, 06/15/2011		5,313,420
		ConAgra Foods, Inc.:
	580,000	5.819%, 06/15/2017		585,880
	120,000	9.75%, 03/01/2021		145,760

The accompanying notes are an integral part of these financial statements.

Page 57

Baird Aggregate Bond Fund

Schedule of Investments       June 30, 2009 (Unaudited)

Principal
Amount			Value
LONG-TERM INVESTMENTS – 95.8% (cont.)
Industrial – 12.7% (cont.)
		Continental Airlines, Inc.
		Pass-Thru Certificates:
$	83,497	Series 2000-2, Class C,
		8.312%, 10/02/2012	$	65,127
	373,641	Series 1997-4,
		6.90%, 01/02/2018		325,068
		COX Communications Inc.:
	1,000,000	7.75%, 11/01/2010		1,040,996
	1,775,000	7.125%, 10/01/2012		1,908,047
	2,000,000	5.45%, 12/15/2014		1,985,374
	2,000,000	CVS Caremark Corp.,
		5.75%, 06/01/2017		2,010,336
	1,000,000	D.R. Horton Inc.
		Unsubordinated Notes,
		6.50%, 04/15/2016		855,000
	300,000	Deutsche Telekom
		International
		Finance BV,
		8.25%, 06/15/2030 f		351,219
		Donnelley (R.R.)
		& Sons Co.:
	3,900,000	4.95%, 05/15/2010		3,905,331
	1,500,000	6.125%, 01/15/2017		1,319,414
	635,000	FedEx Corporation,
		9.65%, 06/15/2012		713,044
	3,136,679	FedEx Corporation
		Pass-Thru Certificates,
		Series 1998-1, 6.845%,
		01/15/2019		2,995,528
	3,725,000	Fiserv, Inc.,
		6.125%, 11/20/2012		3,866,539
	403,000	Ford Motor
		Company Debentures,
		9.215%, 09/15/2021		233,740
	2,200,000	GTE Corporation
		Debentures,
		6.84%, 04/15/2018		2,290,743
	3,500,000	Health Care Service
		Corporation Notes,
		7.75%, 06/15/2011
		(Acquired 06/20/2001,
		01/26/2005 and
		06/15/2009; Cost
		$199,106, $315,372
		and $3,209,610,
		respectively) *		3,663,569
	650,000	Health Management
		Association,
		6.125%, 04/15/2016		557,375
	1,950,000	Highmark, Inc. Notes,
		6.80%, 08/15/2013
		(Acquired 08/14/2003,
		09/05/2007 and
		12/17/2007; Cost
		$274,373, $746,980
		and $956,214,
		respectively) *		1,805,394
	2,000,000	Humana Inc.,
		7.20%, 06/15/2018		1,802,282
	850,000	Johnson Controls Inc.,
		Senior Notes,
		6.00%, 01/15/2036		606,403
	400,000	Laboratory Corporation
		of America,
		5.625%, 12/15/2015		372,878
	900,000	Lafarge S.A. Notes,
		7.125%, 07/15/2036 f		694,473
	1,000,000	Masco Corporation,
		6.125%, 10/03/2016		839,596

The accompanying notes are an integral part of these financial statements.

Page 58

Baird Aggregate Bond Fund

Schedule of Investments       June 30, 2009 (Unaudited)

Principal
Amount			Value
LONG-TERM INVESTMENTS – 95.8% (cont.)
Industrial – 12.7% (cont.)
$	650,000	McClatchy Company,
		5.75%, 09/01/2017	$	97,500
	1,100,000	Nabors Industries, Inc.,
		6.15%, 02/15/2018		1,055,957
	1,050,000	New Cingular Wireless
		Services, Inc. Senior
		Notes, 8.75%, 03/01/2031		1,279,750
	1,500,000	Nextel Communications,
		7.375%, 08/01/2015		1,196,250
	320,000	Pactiv Corporation,
		7.95%, 12/15/2025		300,119
	400,000	PCCW-HWT Capital II
		Ltd., 6.00%, 07/15/2013
		(Acquired 07/10/2003;
		Cost $398,132) * f		390,830
	2,800,000	Pemex Project Funding
		Master Trust,
		5.75%, 03/01/2018		2,576,000
	4,095,000	Plum Creek
		Timberlands,
		5.875%, 11/15/2015		3,461,573
	4,975,000	Premcor Refining Group,
		7.50%, 06/15/2015		5,161,697
		Qwest Capital
		Funding, Inc.:
	300,000	7.00%, 08/03/2009		300,000
	200,000	7.25%, 02/15/2011		194,000
	500,000	Rio Tinto Alcan Inc.,
		5.75%, 06/01/2035 f		362,563
	3,700,000	Rio Tinto Financial
		USA Ltd., 6.50%,
		07/15/2018 f		3,702,157
	1,500,000	SK Telecom,
		6.625%, 07/20/2027
		(Acquired 07/13/2007;
		Cost $1,482,015) * f		1,386,174
		Sprint Capital
		Corporation:
	2,800,000	6.90%, 05/01/2019		2,317,000
	358,000	8.75%, 03/15/2032		288,190
	1,000,000	Target Corporation,
		6.50%, 10/15/2037		1,011,555
		Telecom Italia
		Capital S.A.: f
	1,400,000	6.20%, 07/18/2011		1,449,276
	2,000,000	7.175%, 06/18/2019		2,027,390
	2,100,000	7.20%, 07/18/2036		2,036,118
	2,075,000	Telefonica Emisones S.A.,
		6.221%, 07/03/2017 f		2,195,277
	1,000,000	Teva Pharmaceutical
		Finance LLC,
		5.55%, 02/01/2016		1,034,338
	2,800,000	Time Warner
		Cable, Inc.,
		6.75%, 06/15/2039		2,725,215
		Time Warner, Inc.:
	2,000,000	6.875%, 05/01/2012		2,139,490
	1,100,000	7.625%, 04/15/2031		1,069,372
	250,000	7.70%, 05/01/2032		245,666
	1,000,000	6.55%, 05/01/2037		958,855
	3,000,000	Tyco Electronics
		Group S.A.,
		6.55%, 10/01/2017 f		2,723,778
		Tyco International
		Finance: f
	1,775,000	6.375%, 10/15/2011		1,870,374
	300,000	6.00%, 11/15/2013		305,045
		United AirLines, Inc.
		Pass-Thru Certificates:
	27,938	Series 2001-1, Class A-2,
		6.201%, 12/31/2049		27,658
	269,803	Series 2000-2, Class C,
		7.762%, 10/01/2105		231,356

The accompanying notes are an integral part of these financial statements.

Page 59

Baird Aggregate Bond Fund

Schedule of Investments       June 30, 2009 (Unaudited)

Principal
Amount			Value
LONG-TERM INVESTMENTS – 95.8% (cont.)
Industrial – 12.7% (cont.)
$	471,011	U.S. Airways
		Pass-Thru Certificate,
		Series 1998-1, 6.85%,
		01/30/2018 # **	$	323,537
		Vale Overseas Limited: f
	350,000	8.25%, 01/17/2034		393,649
	1,450,000	6.875%, 11/21/2036		1,376,782
	2,000,000	Verizon Wireless,
		8.50%, 11/15/2018
		(Acquired 11/18/2008;
		Cost $1,978,700) *		2,390,186
	2,250,000	Viacom, Inc.
		Senior Notes,
		7.70%, 07/30/2010		2,316,690
	1,875,000	Vodafone Group PLC,
		6.15%, 02/27/2037 f		1,844,721
		Vulcan Materials:
	2,000,000	7.00%, 06/15/2018		1,928,072
	500,000	7.15%, 11/30/2037		422,700
	1,000,000	Wal-Mart Stores,
		5.25%, 09/01/2035		953,484
	100,000	Westvaco Corporation,
		9.75%, 06/15/2020		103,599
	4,014,000	Weyerhaeuser Company,
		5.25%, 12/15/2009		4,034,391
	3,600,000	Woodside Finance Ltd.,
		8.125%, 03/01/2014
		(Acquired 02/24/2009;
		Cost $3,598,884) * f		3,874,745
				125,810,962
Mortgage Backed Securities – 35.0%
		Bank of America
		Alternative Loan Trust:
	457,827	Series 2003-4, Class 2A1,
		5.00%, 06/25/2018		450,816
	814,479	Series 2003-11,
		Class 4A1,
		4.75%, 01/25/2019		785,718
	527,664	Series 2004-6,
		Class 4A1,
		5.00%, 07/25/2019		482,648
	546,469	Series 2004-11,
		Class 4A1,
		5.50%, 12/25/2019		528,196
	857,861	Series 2005-2, Class 4A1,
		5.50%, 03/25/2020		794,862
	3,987,789	Series 2005-4, Class 3A1,
		5.50%, 05/25/2020		3,429,063
	3,049,758	Series 2005-10,
		Class 5A1,
		5.25%, 11/25/2020		2,734,745
	3,849,092	Series 2007-1, Class 4A1,
		6.098%, 04/25/2022		2,534,386
	1,555,433	Series 2003-11,
		Class 2A1,
		6.00%, 01/25/2034		1,391,870
	853,916	Series 2005-2,
		Class 1CB2,
		5.50%, 03/25/2035		628,064
	1,158,091	Series 2005-9,
		Class 1CB3,
		5.50%, 10/25/2035		909,696
	657,344	Series 2005-11,
		Class 1CB4,
		5.50%, 12/25/2035		512,397
	2,201,460	Series 2006-5, Class CB7,
		6.00%, 06/25/2046		1,500,623
	2,492,142	Chase Commercial
		Mortgage Securities
		Corporation, Series
		1999-2, Class A2,
		7.198%, 01/15/2032		2,504,519

The accompanying notes are an integral part of these financial statements.

Page 60

Baird Aggregate Bond Fund

Schedule of Investments       June 30, 2009 (Unaudited)

Principal
Amount			Value
LONG-TERM INVESTMENTS – 95.8% (cont.)
Mortgage Backed Securities – 35.0% (cont.)
		Chase Mortgage
		Finance Corporation:
$	1,229,772	Series 2003-S13,
		Class A11,
		5.50%, 11/25/2033	$	1,225,791
	6,000,000	Series 2006-A1, Class
		2A3, 6.00%, 09/25/2036		2,906,358
	602,837	Citicorp Mortgage
		Securities, Inc.,
		Series 2004-3, Class A2,
		5.25%, 05/25/2034		605,725
	1,352,340	Citigroup Mortgage
		Loan Trust, Inc.,
		Series 2005-9, Class 2A2,
		5.50%, 10/25/2035		1,010,771
		Countrywide Alternative
		Loan Trust:
	1,270,689	Series 2005-50CB, Class
		4A1, 5.00%, 11/25/2020		995,830
	6,343,727	Series 2006-7CB, Class
		3A1, 5.25%, 05/25/2021		4,418,802
	1,325,845	Series 2006-J5,
		Class 3A1, 6.132%,
		07/25/2021		1,045,346
	1,622,943	Series 2006-43CB,
		Class 2A1, 6.00%,
		02/25/2022		1,230,901
	1,777,394	Series 2002-11, Class A4,
		6.25%, 10/25/2032		1,740,001
	3,000,000	Series 2005-10CB, Class
		1A6, 5.50%, 05/25/2035		2,153,649
	2,417,295	Series 2005-34CB, Class
		1A6, 5.50%, 09/25/2035		2,017,553
	3,038,680	Series 2006-28CB, Class
		A17, 6.00%, 10/25/2036		2,034,771
	568,813	Countrywide Home
		Loans, Inc.,
		Series 2003-39,
		Class A5,
		5.00%, 05/25/2012		573,120
	1,239,251	CS First Boston
		Mortgage Securities Corp.,
		Series 2004-4, Class 2A5,
		5.50%, 06/25/2015		1,189,742
	361,089	Deutsche Mortgage
		Securities, Inc.
		Series 2004-4, Class 1A6,
		5.65%, 04/25/2034		317,812
	1,966,242	Deutsche Securities
		Inc. Mortgage,
		Series 2006-AR5, Class
		21A, 6.00%, 10/25/2021		1,097,990
	782,501	DLJ Commercial
		Mortgage Corporation,
		Series 1999-CG3, Class
		A1B, 7.34%, 10/10/2032		781,642
		Federal Gold Loan
		Mortgage Corporation
		(FGLMC):
	136,589	6.50%, 07/01/2014		145,003
	1,143,181	6.00%, 06/01/2020		1,214,558
	590,543	5.50%, 11/01/2022		614,855
	692,419	5.00%, 06/01/2023		713,063
	530,161	5.50%, 07/01/2023		551,614
	1,370,643	6.50%, 06/01/2029		1,472,611
	5,480,071	5.50%, 01/01/2036		5,676,101
	3,607,848	6.00%, 12/01/2036		3,772,527
	5,235,342	5.50%, 04/01/2037		5,411,984

The accompanying notes are an integral part of these financial statements.

Page 61

Baird Aggregate Bond Fund

Schedule of Investments       June 30, 2009 (Unaudited)

Principal
Amount			Value
LONG-TERM INVESTMENTS – 95.8% (cont.)
Mortgage Backed Securities – 35.0% (cont.)
		Federal Home Loan
		Mortgage Corporation
		(FHLMC):
$	881,640	Series 3124, Class VP,
		6.00%, 06/15/2014	$	939,904
	402,013	Series 2695, Class UA,
		5.50%, 09/15/2014		419,351
	1,999,691	Series R007, Class AC,
		5.875%, 05/15/2016		2,051,999
	3,398,169	Series R003, Class VA,
		5.50%, 08/15/2016		3,634,863
	2,125,989	Series 3097, Class MC,
		6.00%, 11/15/2016		2,255,781
	465,348	Series 2391, Class QR,
		5.50%, 12/15/2016		493,801
	4,314,659	Series R009, Class AJ,
		5.75%, 12/15/2018		4,465,434
	134,970	Series 206, Class E,
		0.00%, 07/15/2019 ^		126,786
	1,575,675	Series R010, Class AB,
		5.50%, 12/15/2019		1,621,551
	82,600	Series 141, Class D,
		5.00%, 05/15/2021		82,962
	76,320	Series 1074, Class I,
		6.75%, 05/15/2021		81,317
	433,690	Series 1081, Class K,
		7.00%, 05/15/2021		471,278
	65,374	Series 163, Class F,
		6.00%, 07/15/2021		70,342
	132,707	Series 188, Class H,
		7.00%, 09/15/2021		142,722
	65,706	Series 1286, Class A,
		6.00%, 05/15/2022		65,697
	2,556,365	Series 1694, Class PK,
		6.50%, 03/15/2024		2,736,167
	19,219,392	Series 2009-15,
		Class MA,
		4.00%, 03/25/2024		19,733,643
	1,390,602	Series 2664, Class LG,
		5.50%, 07/15/2028		1,424,626
	2,891,682	Series 2552, Class ND,
		5.50%, 10/15/2031		2,983,685
		Federal National
		Mortgage Association
		(FNMA):
	1,622,232	5.00%, 02/01/2018		1,699,186
	2,081,182	5.00%, 12/01/2019		2,179,258
	1,432,560	5.50%, 01/01/2023		1,491,645
	2,052,453	5.50%, 07/01/2023		2,136,255
	4,283,464	5.00%, 11/01/2023		4,399,595
	2,303,126	6.00%, 03/01/2026		2,425,061
	5,470,559	6.00%, 05/01/2026		5,760,188
	6,879,250	5.00%, 05/01/2028		7,053,647
	507,347	6.00%, 03/01/2033		534,944
	438,220	5.00%, 11/01/2033		448,336
	2,006,669	5.50%, 04/01/2034		2,079,532
	1,712,461	5.50%, 09/01/2034		1,775,859
	695,216	6.00%, 11/01/2034		731,077
	4,367,585	5.50%, 02/01/2035		4,529,280
	11,601,784	5.50%, 02/01/2035		12,031,300
	6,824,366	5.00%, 07/01/2035		6,976,582
	6,128,551	5.00%, 11/01/2035		6,261,416
	7,192,267	5.00%, 02/01/2036		7,348,193
	20,294,174	5.00%, 03/01/2036		20,734,145
	41,839,475	5.50%, 04/01/2036		43,349,210
	7,197,254	5.50%, 11/01/2036		7,444,589
	1,749,824	6.00%, 08/01/2037		1,825,866
	4,155,795	Series 2006-B2, Class AB,
		5.50%, 05/25/2014		4,318,483
	411,477	Series 2003-27, Class OJ,
		5.00%, 07/25/2015		416,883

The accompanying notes are an integral part of these financial statements.

Page 62

Baird Aggregate Bond Fund

Schedule of Investments       June 30, 2009 (Unaudited)

Principal
Amount			Value
LONG-TERM INVESTMENTS – 95.8% (cont.)
Mortgage Backed Securities – 35.0% (cont.)
$	337,271	Series 2003-24,
		Class PC,
		5.00%, 11/25/2015	$	343,514
	63,922	Series 2002-56,
		Class MC,
		5.50%, 09/25/2017		67,754
	370,072	Series 1989-37, Class G,
		8.00%, 07/25/2019		412,721
	64,789	Series 1989-94, Class G,
		7.50%, 12/25/2019		71,135
	17,907	Series 1990-58, Class J,
		7.00%, 05/25/2020		19,413
	171,659	Series 1990-76, Class G,
		7.00%, 07/25/2020		186,250
	73,198	Series 1990-105, Class J,
		6.50%, 09/25/2020		79,557
	27,688	Series 1990-108, Class G,
		7.00%, 09/25/2020		29,548
	51,316	Series 1991-1, Class G,
		7.00%, 01/25/2021		55,762
	58,514	Series 1991-86, Class Z,
		6.50%, 07/25/2021		62,953
	205,462	Series 2003-28, Class KA,
		4.25%, 03/25/2022		211,070
	26,911	Series G92-30, Class Z,
		7.00%, 06/25/2022		28,961
	2,362,707	Series 2003-33, Class LD,
		4.25%, 09/25/2022		2,436,185
	723,842	Series 1993-58, Class H,
		5.50%, 04/25/2023		774,487
	472,264	Series 1998-66, Class C,
		6.00%, 12/25/2028		507,235
	1,788,484	Series 2002-85,
		Class PD, 5.50%,
		05/25/2031		1,842,945
	71,214	Series 2003-44,
		Class AB,
		3.75%, 05/25/2033		70,880
	2,459,454	Series 2004-W6, Class
		1A4, 5.50%, 07/25/2034		2,302,565
	4,493,553	Series 2004-W6, Class
		1A6, 5.50%, 07/25/2034		4,694,358
	6,391,070	Series 2004-W10, Class
		A24, 5.00%, 08/25/2034		6,334,949
	4,000,000	Series 2004-W10, Class
		A4, 5.75%, 08/25/2034		3,753,916
		First Horizon Alternative
		Mortgage Securities:
	965,478	Series 2005-FA7, Class
		2A1, 5.00%, 09/25/2020		757,599
	1,342,086	Series 2006-FA6, Class
		3A1, 5.75%, 11/25/2021		1,084,993
	3,495,491	Series 2006-FA8, Class
		2A1, 5.75%, 02/25/2037		1,955,137
	2,950,000	First Union National
		Bank Commercial
		Mortgage Securities Inc.,
		Series 2001-C4, Class A2,
		6.223%, 12/12/2033		3,033,491
		GE Capital Commercial
		Mortgage Corporation:
	6,226,100	Series 2000-1, Class A2,
		6.496%, 01/15/2033		6,287,459
	2,865,000	Series 2002-3A, Class AZ,
		4.996%, 12/10/2037		2,795,364
	6,200,000	Series 2004-C3, Class A4,
		5.189%, 07/10/2039		5,530,027
	10,100,000	GMAC Commercial
		Mortgage Securities, Inc.,
		Series 2003-C1,
		Class A2, 4.079%,
		05/10/2036		9,411,960

The accompanying notes are an integral part of these financial statements.

Page 63

Baird Aggregate Bond Fund

Schedule of Investments       June 30, 2009 (Unaudited)

Principal
Amount			Value
LONG-TERM INVESTMENTS – 95.8% (cont.)
Mortgage Backed Securities – 35.0% (cont.)
		Government National
		Mortgage Association
		(GNMA):
$	413,841	6.00%, 11/20/2033	$	431,246
	800,000	Series 2004-78, Class C,
		4.658%, 04/16/2029		827,890
	1,285,000	Series 2004-100, Class B,
		4.603%, 02/16/2043		1,320,298
	1,268,402	J.P. Morgan Alternative
		Loan Trust, Series
		2006-A1, Class 2A1,
		5.799%, 03/25/2036		716,467
		J.P. Morgan
		Mortgage Trust:
	3,100,000	Series 2006-A7,
		Class 2A4R, 5.457%,
		01/25/2037		1,637,899
	1,666,009	Series 2006-A7,
		Class 2A2, 5.83%,
		01/25/2037		1,173,384
	6,100,000	Series 2007-A2,
		Class 2A3, 5.715%,
		04/25/2037		3,405,033
		Master Alternative
		Loans Trust:
	2,724,480	Series 2004-1, Class 1A1,
		5.00%, 01/25/2019		2,410,314
	1,994,715	Series 2004-4, Class 4A1,
		5.00%, 04/25/2019		1,864,435
	815,435	Series 2003-5, Class 6A1,
		6.00%, 08/25/2033		688,915
	605,836	Residential Accredit
		Loans, Inc., Series
		2004-QS6, Class A1,
		5.00%, 05/25/2019		554,151
	800,000	Residential Funding
		Mortgage Security I,
		Series 2003-S11,
		Class A2, 4.00%,
		06/25/2018		774,013
		Salomon Brothers
		Mortgage Securities VII:
	3,783,649	Series 2000-C1, Class A2,
		7.52%, 12/18/2009		3,806,831
	3,462,014	Series 2001-C2, Class A3,
		6.50%, 10/13/2011		3,553,224
	1,163,962	Series 2003-UP2,
		Class A2, 4.00%,
		06/25/2033		1,143,785
	2,050,000	Wachovia Bank
		Commercial Mortgage
		Trust, Series 2003-C3,
		Class A2, 4.867%,
		02/15/2035		1,903,007
		Washington Mutual, Inc.
		Pass-Thru Certificates:
	2,122,063	Series 2004-CB1, Class
		5A, 5.00%, 06/25/2019		2,089,569
	3,734,704	Series 2004-CB2, Class
		7A, 5.50%, 08/25/2019		3,535,130
	1,335,702	Series 2004-CB3, Class
		4A, 6.00%, 10/25/2019		1,213,402
	828,684	Series 2004-CB4,
		Class 21A, 5.50%,
		12/25/2019		738,501
				344,787,844
Taxable Municipal Bonds – 0.8%
	1,000,000	Cuyahoga County
		Ohio Industrial
		Development Revenue,
		9.125%, 10/01/2023		1,064,570

The accompanying notes are an integral part of these financial statements.

Page 64

Baird Aggregate Bond Fund

Schedule of Investments       June 30, 2009 (Unaudited)

Principal
Amount			Value
LONG-TERM INVESTMENTS – 95.8% (cont.)
Taxable Municipal Bonds – 0.8% (cont.)
$	8,290,000	Tobacco Settlement
		Authority Iowa,
		6.50%, 06/01/2023	$	6,201,335
	615,529	Tobacco Settlement
		Financing Corporation,
		Series 2001-A, Class A,
		6.36%, 05/15/2025		566,822
				7,832,727
Utilities – 5.7%
	850,000	Arizona Pubic Service
		Senior Unsecured Notes,
		8.75%, 03/01/2019		926,741
	599,000	Beaver Valley Funding
		Corporation Debentures,
		9.00%, 06/01/2017		591,231
	3,657,000	Constellation Energy
		Group Inc. Senior
		Unsecured Notes,
		6.125%, 09/01/2009		3,672,765
	1,900,000	Enel Finance International,
		6.80%, 09/15/2037
		(Acquired 09/13/2007;
		Cost $1,894,965) * f		1,969,730
	750,000	Energy Transfer Partners,
		5.65%, 08/01/2012		764,825
		Exelon Corporation
		Senior Notes:
	3,600,000	4.45%, 06/15/2010		3,635,640
	300,000	6.75%, 05/01/2011		313,130
	2,500,000	FPL Group Capital, Inc.,
		7.30%, 09/01/2067
		(Callable 09/01/2017)		2,125,000
	705,344	GG1C Funding
		Corporation,
		5.129%, 01/15/2014
		(Acquired 06/27/2006;
		Cost $683,307) *		649,163
		Kinder Morgan Energy
		Partners Senior Notes:
	1,000,000	9.00%, 02/01/2019		1,137,385
	2,250,000	6.95%, 01/15/2038		2,179,555
	900,000	Kinder Morgan Finance,
		5.70%, 01/05/2016 f		771,750
	172,383	Kiowa Power Partners LLC,
		4.811%, 12/30/2013
		(Acquired 11/19/2004;
		Cost $172,383) *		158,840
		Korea Electric Power
		Corporation: f
	100,000	7.75%, 04/01/2013		105,329
	2,165,000	6.75%, 08/01/2027		1,645,703
	1,325,000	National Grid PLC
		Senior Unsecured Notes,
		6.30%, 08/01/2016 f		1,361,285
	1,500,000	National Rural
		Utilities Coop,
		10.375%, 11/01/2018		1,880,735
		NiSource Finance
		Corporation:
	2,875,000	7.875%, 11/15/2010		2,969,556
	2,948,000	6.15%, 03/01/2013		2,930,398
	625,000	ONEOK, Inc.
		Senior Notes,
		7.125%, 04/15/2011		658,961
	1,000,000	Plains All American
		Pipeline Senior Notes,
		5.625%, 12/15/2013		990,884

The accompanying notes are an integral part of these financial statements.

Page 65

Baird Aggregate Bond Fund

Schedule of Investments       June 30, 2009 (Unaudited)

Principal
Amount			Value
LONG-TERM INVESTMENTS – 95.8% (cont.)
Utilities – 5.7% (cont.)
$	300,000	PPL Energy Supply,
		LLC Senior Notes,
		6.40%, 11/01/2011	$	315,974
	175,000	PSE&G Energy
		Holdings LLC
		Senior Notes,
		8.50%, 06/15/2011		176,683
		PSE&G Power LLC:
	2,250,000	7.75%, 04/15/2011		2,408,137
	350,000	5.00%, 04/01/2014		352,790
	1,564,583	RGS (I&M) Funding
		Corporation Debentures,
		9.82%, 12/07/2022		1,712,076
	3,900,000	Rockies Express Pipeline
		LLC, 5.776%, 08/20/2009
		(Acquired 09/17/2007,
		02/21/2008 and
		02/25/2009; Cost
		$2,199,441, $698,062
		and $997,352,
		respectively) *		3,900,371
	1,400,000	Southern Natural Gas,
		5.90%, 04/01/2017
		(Acquired 03/14/2007;
		Cost $1,397,676) *		1,355,908
	3,500,000	Spectra Energy Capital,
		5.668%, 08/15/2014		3,534,164
	1,000,000	Talisman Energy Inc.,
		7.75%, 06/01/2019 f		1,107,794
	2,000,000	Trans-Canada Pipelines,
		6.50%, 08/15/2018 f		2,175,856
	2,200,000	Transcontinental Gas
		Pipe Line Corporation
		Senior Notes,
		8.875%, 07/15/2012		2,418,926
		Vectren Utility
		Holdings:
	875,000	6.625%, 12/01/2011		917,440
	1,100,000	5.25%, 08/01/2013		1,113,684
		Williams Companies,
		Inc. Notes:
	2,475,000	6.375%, 10/01/2010
		(Acquired 07/09/2008;
		Cost $2,489,559) *		2,474,517
	550,000	8.125%, 03/15/2012		569,993
				55,972,919
U.S. Government Agency Issues – 3.9%
	38,775,000	Federal National Mortgage
		Association (FNMA),
		2.75%, 03/13/2014		38,692,022
U.S. Treasury Obligations – 15.8%
		U.S. Treasury Bonds:
	34,750,000	2.25%, 05/31/2014		34,283,064
	99,475,000	6.25%, 08/15/2023		121,172,985
				155,456,049
		Total Long-Term
		Investments
		(Cost $1,002,673,266)		944,782,652
Shares
SHORT-TERM INVESTMENTS – 6.4%
Money Market Funds – 6.4%
	63,266,080	Short-Term Investment
		Company Liquid Assets
		Portfolio – AIM Fund		63,266,080
		Total Short-Term
		Investments
		(Cost $63,266,080)		63,266,080

The accompanying notes are an integral part of these financial statements.

Page 66

Baird Aggregate Bond Fund

Schedule of Investments       June 30, 2009 (Unaudited)

Principal
Amount			Value
INVESTMENTS PURCHASED
WITH CASH PROCEEDS FROM
SECURITIES LENDING – 27.2%
Commercial Paper – 0.5%
$	4,516,706	Atlantic East
		Funding LLC,
		3.059%, 03/25/10 # **	$	4,516,706
				4,516,706
Corporate Bond – 0.4%
	4,381,863	Svenska Handelsbanken,
		4.418%, 08/06/09 f		4,381,863
				4,381,863
Shares
Investment Companies – 26.3%
	258,020,640	Mount Vernon
		Securities Lending
		Trust Prime Portfolio	$	258,020,640
	1,610,037	Reserve
		Primary Fund # **		1,610,037
				259,630,677
		Total Investments
		Purchased With Cash
		Proceeds From
		Securities Lending
		(Cost $268,529,246)		268,529,246
		Total Investments
		(Cost $1,334,468,592) –
		129.4%		1,276,577,978
		Liabilities in Excess of
		Other Assets – (29.4)%		(290,259,930	)
		TOTAL NET
		ASSETS – 100.0%	$	986,318,048

^ Non Income Producing

* Restricted Security Deemed Liquid

** Illiquid Security

f Foreign Security

# Priced at Fair Value by the Valuation Committee as delegated by the Baird Funds’ Board of Directors

@ Security in Default

The accompanying notes are an integral part of these financial statements.

Page 67

Baird Aggregate Bond Fund

Schedule of Investments       June 30, 2009 (Unaudited)

SFAS 157 – Summary of Fair Value Exposure at June 30, 2009

As adopted by the Fund, the Financial Accounting Standards Board issued Statement of Financial Accounting Standards No. 157, “Fair Value Measurements” (“SFAS 157”) defines fair value, establishes a framework for measuring fair value in generally accepted accounting principles (GAAP), and expands disclosures about fair value measurements.  Under SFAS 157, various inputs are used in determining the value of the Fund’s investments.  These inputs are summarized into three broad levels and described below:

Level 1 –	Quoted prices in active markets for identical securities.
Level 2 –	Other significant observable inputs (including quoted prices for similar securities, quoted prices for identical securities in inactive markets, dealer indications, interest rates, yield curves, benchmark yields, issuer spreads, prepayment speeds, cash flows, credit risk, default rates, information about issuers, sectors and markets, inputs corroborated by observable market data, etc.)
Level 3 –	Significant unobservable inputs (including the Fund’s own assumptions about the assumptions that market participants would use in pricing the security)

The inputs or methodology used for valuing securities are not necessarily an indication of the risk associated with investing in those securities.

The following is a summary of the inputs used to value the Fund’s net assets as of June 30, 2009:

	Level 1		Level 2		Level 3		Total
Fixed Income
Asset Backed Securities	$	—	$	51,278,495	$	1,300,000	$	52,578,495
Corporate Debt Securities		—		345,111,978		323,537		345,435,515
Mortgage Backed Securities		—		344,787,844		—		344,787,844
Taxable Municipal Bonds		—		7,832,727		—		7,832,727
U.S. Government Agency Issues		—		38,692,022		—		38,692,022
U.S. Treasury Obligations		—		155,456,049		—		155,456,049
Total Fixed Income		—		943,159,115		1,623,537		944,782,652
Short-Term Investments
Money Market Mutual Funds		63,266,080		—		—		63,266,080
Total Short-Term Investments		63,266,080		—		—		63,266,080
Investments Purchased With Cash
Proceeds From Securities Lending
Commercial Paper		—		4,516,706		—		4,516,706
Corporate Bonds		—		4,381,863		—		4,381,863
Money Market Mutual Funds		258,020,640		—		1,610,037		259,630,677
Total Investments Purchased With Cash
Proceeds From Securities Lending		258,020,640		8,898,569		1,610,037		268,529,246
Total Investments in Securities	$	321,286,720	$	952,057,684	$	3,233,574	$	1,276,577,978

Page 68

Baird Aggregate Bond Fund

Schedule of Investments       June 30, 2009 (Unaudited)

Level 3 Reconciliation Disclosure

Following is a reconciliation of Level 3 assets for which significant unobservable inputs were used to determine fair value.

Description	Investments in Securities
Balance as of December 31, 2008	$	4,580,447
Accrued discounts/premiums		—
Realized gain (loss)		—
Change in unrealized appreciation (depreciation)		912,590
Net purchases (sales/paydowns)		(1,803,026	)
Transfers in and/or out of Level 3 *		(456,437	)
Balance as of June 30, 2009	$	3,233,574
Change in unrealized appreciation (depreciation) during
the year for level 3 investments held at June 30, 2009.		912,590

* The information used in the above reconciliation represents fiscal year to date activity for any investments identified as using Level 3 inputs at either the beginning or end of the current fiscal period.  Transfers in or out of Level 3 represents either the beginning value (for transfers in) or ending value (for transfers out) of any security or instrument where a change in the pricing level occurred from the beginning to the end of the period.

Page 69

Baird Core Plus Bond Fund

June 30, 2009

The Baird Core Plus Bond Fund seeks an annual rate of total return, before Fund expenses, greater than the annual rate of total return of the Barclays Capital U.S. Universal Bond Index.  The Barclays Capital U.S. Universal Bond Index is an unmanaged, market value weighted index of fixed income securities issued in U.S. dollars, including U.S. government and investment grade debt, non-investment grade debt, asset-backed and mortgage-backed securities, Eurobonds, 144A securities and emerging market debt, with maturities of at least one year.

Portfolio Characteristics

Quality Distribution*	Sector Weightings*

Net Assets:	$214,069,770	Annualized Expense Ratio:
SEC 30-Day Yield:**		Institutional Class:	0.30	%
Institutional Class:	6.85%	Investor Class:	0.55	%***
Investor Class:	6.58%	Portfolio Turnover Rate:	22.9	%#
Average Effective Duration:	4.32 years	Total Number of Holdings:	338
Average Effective Maturity:	6.28 years

* Percentages shown are based on the Fund’s total net assets.

** SEC yields are based on SEC guidelines and are calculated for the 30 days ended June 30, 2009.

*** Includes 0.25% 12b-1 fee.

# Not annualized.

Page 70

Baird Core Plus Bond Fund

Average Annual Total Returns

			Since
For the Periods Ended June 30, 2009	One Year	Five Years	Inception(1)
Institutional Class Shares	3.66%	4.89%	6.12%
Investor Class Shares	3.41%	4.64%	5.86%
Barclays Capital U.S. Universal Bond Index(2)	4.93%	4.95%	5.98%

(1) For the period from September 29, 2000 (commencement of operations) through June 30, 2009.

(2) The Barclays Capital U.S. Universal Bond Index is an unmanaged, market value weighted index of fixed income securities issued in U.S. dollars, including U.S. government and investment grade debt, non-investment grade debt, asset-backed and mortgage-backed securities, Eurobonds, 144A securities and emerging market debt, with maturities of at least one year.  This index does not reflect any deduction for fees, expenses or taxes.  A direct investment in an index is not possible.

The returns shown in the table above reflect reinvestment of dividends and/or capital gains distributions in additional shares.  The returns do not reflect the deduction of taxes that a shareholder would pay on Fund distributions or the redemption of Fund shares.

Past performance does not guarantee future results.  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.

For information about the performance of the Fund as of the most recent month-end, please call 1-866-44BAIRD or visit www.bairdfunds.com.  Mutual fund performance changes over time and current performance may be lower or higher than that stated.

Page 71

Baird Core Plus Bond Fund

Schedule of Investments       June 30, 2009 (Unaudited)

Principal
Amount			Value
LONG-TERM INVESTMENTS – 97.3%
Asset Backed Securities – 7.3%
$	1,825,000	American Express Credit
		Account Master Trust,
		Series 2005-5, Class A,
		4.276%, 02/15/2013	$	1,809,227
	109,232	Amresco Residential
		Securities Mortgage
		Loan Trust,
		Series 1998-2, Class A6,
		6.45%, 12/25/2027		94,572
	600,000	Bayview Financial
		Acquisition Trust,
		Series 2007-A,
		6.205%, 05/28/2037		369,452
		Capital One Multi-Asset
		Execution Trust:
	175,000	Series 2006-9A, Class A9,
		5.415%, 05/15/2013		173,005
	275,000	Series 2003-A5, Class A5,
		0.610%, 07/15/2013		272,222
	350,000	Chase Issuance Trust,
		Series 2007-A15, Class A,
		4.96%, 09/17/2012		362,331
	56,518	CitiFinancial Mortgage
		Securities, Inc.,
		Series 2004-1, Class AF2,
		2.645%, 04/25/2034		53,311
		Countrywide Asset-Backed
		Certificates:
	195,357	Series 2006-S2, Class A2,
		5.627%, 07/25/2027		137,670
	1,483,070	Series 2006-S7, Class A2,
		5.571%, 11/25/2035		340,001
	583,930	Series 2005-10, Class AF6,
		4.915%, 02/25/2036		316,520
	56,587	Series 2005-13, Class AF2,
		5.294%, 04/25/2036		55,493
	1,000,000	Series 2005-13,
		Class AF3, 5.43%,
		04/25/2036		665,844
	356,153	Series 2006-S9, Class A3,
		5.728%, 08/25/2036		131,415
	1,000,000	Series 2006-13,
		Class 1AF2, 5.884%,
		01/25/2037		792,285
	1,300,000	Series 2006-10,
		Class 1AF3, 5.971%,
		09/25/2046		631,442
	616,000	Series 2006-9, Class 1AF3,
		5.859%, 10/25/2046		189,993
	812,773	Credit-Based Asset
		Servicing and Security,
		Series 2005-CB3,
		4.725%, 02/25/2033		730,599
		Discover Card Master
		Trust I:
	1,075,000	Series 2005-2, Class A,
		4.266%, 04/17/2012		1,073,187
	650,000	Series 2003-3, Class A,
		2.66%, 09/15/2012		646,702
	8,560	GE Capital Mortgage
		Services, Inc.,
		Series 1999-HE1, Class
		A7, 6.265%, 04/25/2029		7,604
	431,442	GMAC Mortgage
		Corporation Loan Trust,
		Series 2005-HE3, Class
		A2, 3.526%, 02/25/2036		140,220
		Green Tree Financial
		Corporation:
	77,088	Series 1993-4, Class A5,
		7.05%, 01/15/2019		71,679
	24,973	Series 1997-1, Class A5,
		6.86%, 03/15/2028		23,445

The accompanying notes are an integral part of these financial statements.

Page 72

Baird Core Plus Bond Fund

Schedule of Investments       June 30, 2009 (Unaudited)

Principal
Amount			Value
LONG-TERM INVESTMENTS – 97.3% (cont.)
Asset Backed Securities – 7.3% (cont.)
$	77,055	Series 1997-4, Class A5,
		6.88%, 02/15/2029	$	69,148
	1,075,054	Series 1997-5, Class A6,
		6.82%, 05/15/2029		1,001,261
	878,638	Series 1998-3, Class A5,
		6.22%, 03/01/2030		704,895
	367,759	Series 1998-4, Class A5,
		6.18%, 04/01/2030		296,337
		MBNA Master
		Credit Card Trust:
	375,000	Series 2000-E, Class A,
		7.80%, 10/15/2012		394,338
	250,000	Series 2002-A3, Class A3,
		0.559%, 09/15/2014		241,040
	52,892	Oakwood Mortgage
		Investors, Inc.,
		Series 1999-B, Class A3,
		6.45%, 11/15/2017		32,265
		Renaissance Home
		Equity Loan Trust:
	271,911	Series 2005-1, Class AF6,
		4.97%, 05/25/2035		200,064
	819,000	Series 2006-2, Class AF3,
		5.797%, 08/25/2036		589,702
	769,250	Series 2006-3, Class AF2,
		5.58%, 11/25/2036		650,629
	500,000	Series 2007-1, Class AF2,
		5.512%, 04/25/2037		200,689
	1,500,000	Series 2007-2, Class AF2,
		5.675%, 06/25/2037		665,224
	242,889	Residential Asset
		Mortgage Products, Inc.,
		Series 2003-RS10, Class
		AI7, 4.85%, 11/25/2033		185,416
	330,255	Residential Asset
		Securities Corporation,
		Series 2003-KS5, Class
		AI6, 3.62%, 07/25/2033		183,781
	400,000	Stingray Pass-Thru
		Certificates, Series 2005,
		5.902%, 01/12/2015
		(Acquired 05/10/2007,
		Cost $384,611) # **		200,000
	1,786,880	Structured Asset Securities
		Corporation, Series
		2005-7XS, Class 1A4B,
		5.44%, 04/25/2035		1,015,212
				15,718,220
Financial – 20.1%
	825,000	American Express Credit
		Corporation, Series C,
		7.30%, 08/20/2013		857,760
	1,000,000	American General Finance,
		6.90%, 12/15/2017		541,482
	150,000	AmSouth Bancorporation
		Subordinated Debentures,
		6.75%, 11/01/2025		101,916
	155,000	Associates Corporation
		North America
		Subordinated Debentures,
		8.15%, 08/01/2009		155,111
	500,000	Bancwest Corporation,
		8.30%, 01/15/2011		515,938
	300,000	Bank of America
		Corporation Subordinated
		Notes, 10.20%, 07/15/2015		313,753
	150,000	Bank Tokyo –
		Mitsubishi UFJ Ltd.,
		7.40%, 06/15/2011 f		154,341

The accompanying notes are an integral part of these financial statements.

Page 73

Baird Core Plus Bond Fund

Schedule of Investments       June 30, 2009 (Unaudited)

Principal
Amount			Value
LONG-TERM INVESTMENTS – 97.3% (cont.)
Financial – 20.1% (cont.)
$	200,000	Banponce Trust I, Series A,
		8.327%, 02/01/2027
		(Callable 09/08/2009)	$	117,593
	400,000	Bear Stearns Cos., Inc.,
		Series B, 6.95%,
		08/10/2012		434,742
	1,000,000	BOI Capital Funding III,
		6.107%, 02/04/2016 f		375,000
	170,000	Capmark Financial
		Group, Inc.,
		5.875%, 05/10/2012		44,169
	600,000	CIT Group Funding
		Company of Canada,
		5.20%, 06/01/2015 f		347,573
		Cit Group, Inc.
		Senior Notes:
	75,000	4.75%, 12/15/2010		58,876
	250,000	7.625%, 11/30/2012		171,186
	400,000	6.10%, 03/15/2067
		(Callable 03/15/2017)		151,716
	700,000	Citigroup Capital XXI,
		8.30%, 12/21/2077
		(Callable 12/21/2037)		545,877
	825,000	Countrywide Financial
		Corporation Subordinated
		Notes, 6.25%, 05/15/2016		731,919
	500,000	Export-Import
		Bank Korea Notes,
		4.625%, 03/16/2010 f		502,020
	500,000	Fifth Third Bank,
		4.20%, 02/23/2010		499,634
	500,000	First Empire Capital Trust I,
		8.234%, 02/01/2027
		(Callable 09/08/2009)		329,707
	1,000,000	First Empire Capital Trust II,
		8.277%, 06/01/2027
		(Callable 09/08/2009)		660,615
	1,100,000	First National Bank
		of Omaha Subordinated
		Notes, 7.32%, 12/01/2010		1,080,001
	1,300,000	First Tennessee Capital I,
		8.07%, 01/06/2027		849,914
	450,000	First Union Capital I,
		Series A, 7.935%,
		01/15/2027		407,640
	2,100,000	GE Global Insurance
		Holding Corporation,
		7.50%, 06/15/2010		2,095,353
		GMAC LLC:
	97,000	7.75%, 01/19/2010
		(Acquired 04/29/2009;
		Cost $86,485) *		94,575
	49,000	7.50%, 12/31/2013
		(Acquired 12/21/2006,
		12/26/2006 and 9/29/2008;
		Cost $29,284, $116,959
		and $9,972, respectively) *		37,975
	250,000	6.75%, 12/01/2014		192,194
	59,000	8.000, 12/31/2018
		(Acquired 12/21/2006,
		12/26/2006 and 9/29/2008;
		Cost $37,893, $151,329
		and $11,985, respectively) *		37,465
		General Electric Capital
		Corporation Notes:
	150,000	6.00%, 06/15/2012		157,678
	1,000,000	5.625%, 09/15/2017		957,048
		General Motors Acceptance
		Corporation Notes:
	75,000	7.75%, 01/19/2010		73,136
	450,000	6.875%, 09/15/2011		386,923

The accompanying notes are an integral part of these financial statements.

Page 74

Baird Core Plus Bond Fund

Schedule of Investments       June 30, 2009 (Unaudited)

Principal
Amount			Value
LONG-TERM INVESTMENTS – 97.3% (cont.)
Financial – 20.1% (cont.)
$	1,627,000	Genworth Global
		Funding Trust,
		5.125%, 03/15/2011	$	1,570,359
	425,000	Glencore Funding LLC,
		6.00%, 04/15/2014
		(Acquired 03/31/2004,
		12/04/2006 and 9/28/2008;
		Cost $148,928, $198,740
		and $72,035, respectively) *		351,012
	125,000	Goldman Sachs Capital I,
		6.345%, 02/15/2034		100,845
		Goldman Sachs Group, Inc.:
	100,000	5.15%, 01/15/2014		100,366
	1,000,000	5.95%, 01/18/2018		969,959
	530,000	Goldman Sachs Group LP,
		8.000, 03/01/2013
		(Acquired 05/19/2006 and
		12/23/2008; Cost $31,800
		and $500,000, respectively) *		574,015
	800,000	Hartford Financial
		Services Group,
		8.125%, 06/15/2068
		(Callable 06/15/2018)		560,000
	175,000	HSBC Bank PLC
		Subordinated Notes,
		6.95%, 03/15/2011 f		179,772
	250,000	HSBC Finance Corporation,
		7.00%, 05/15/2012		257,742
	550,000	Huntington National Bank
		Notes, 8.00%, 04/01/2010		550,113
		Invesco Ltd.: f
	1,570,000	5.625%, 04/17/2012		1,445,870
	1,110,000	5.375%, 12/15/2014		861,196
	400,000	Istar Financial, Inc.,
		5.85%, 03/15/2017		160,000
	125,000	JPMorgan Chase & Co.,
		7.00%, 11/15/2009		126,957
	100,000	J.P. Morgan Chase Capital
		XV, 5.875%, 03/15/2035		80,000
	400,000	Jefferies Group, Inc.,
		6.45%, 06/08/2027		294,241
	600,000	Key Bank NA,
		7.413%, 05/06/2015		537,851
		Lehman Brothers
		Holdings, Inc. Notes:
	100,000	6.625%, 01/18/2012 @		14,750
	400,000	8.80%, 03/01/2015 @		59,000
		Liberty Mutual Group:
	50,000	6.50%, 03/15/2035
		(Acquired 09/28/2008;
		Cost $36,977) *		30,394
	900,000	10.75%, 06/15/2088
		(Callable 06/15/2038)
		(Acquired 05/21/2008,
		08/28/2008 and 05/06/2009;
		Cost $489,025, $113,750
		and $147,312, respectively) *		648,000
	375,000	Liberty Mutual Insurance,
		7.697%, 10/15/2097
		(Acquired 03/26/2003;
		Cost $240,077) *		224,337
	825,000	Lincoln National
		Corporation,
		6.05%, 04/20/2067
		(Callable 04/20/2017)		523,875
	500,000	Manufacturer And
		Traders Trust Co.,
		6.625%, 12/04/2017		475,624
	700,000	Marsh & McLennan
		Companies, Inc.,
		5.375%, 07/15/2014		681,456

The accompanying notes are an integral part of these financial statements.

Page 75

Baird Core Plus Bond Fund

Schedule of Investments       June 30, 2009 (Unaudited)

Principal
Amount			Value
LONG-TERM INVESTMENTS – 97.3% (cont.)
Financial – 20.1% (cont.)
$	700,000	MBIA Insurance Company,
		14.00%, 01/15/2033
		(Callable 01/15/2013)
		(Acquired 01/11/2008;
		Cost $700,000) *	$	266,000
		Merrill Lynch
		& Company:
	100,000	5.00%, 02/03/2014		95,932
	600,000	6.875%, 04/25/2018		555,334
	500,000	7.75%, 05/14/2038		464,452
	520,000	M&I Marshall & Ilsley
		Bank Senior Unsecured
		Notes, 5.30%, 09/08/2011		456,909
	828,000	The Mony Group, Inc.
		Senior Unsecured Notes,
		8.35%, 03/15/2010		855,322
		Morgan Stanley Senior
		Unsecured Notes:
	125,000	4.25%, 05/15/2010		126,418
	800,000	5.625%, 01/09/2012		818,726
	125,000	6.625%, 04/01/2018		124,613
	400,000	National Australia Bank
		Ltd. Subordinated
		Notes, Series A,
		8.60%, 05/19/2010 f		422,300
	75,000	National Bank of Hungary
		Yankee Debentures,
		8.875%, 11/01/2013 f		76,883
	871,000	National City Bank,
		6.20%, 12/15/2011		895,128
	500,000	National City Bank of
		Kentucky Subordinated
		Notes, 6.30%, 02/15/2011		506,007
	800,000	Nationwide Financial
		Services, Inc.,
		5.90%, 07/01/2012		785,836
	1,459,000	Navigators Group Inc.
		Senior Unsecured Notes,
		7.00%, 05/01/2016		1,134,387
	750,000	Pricoa Global Funding I,
		2.066%, 06/04/2010
		(Acquired 04/29/2009;
		Cost $690,893) *		743,600
	550,000	Principal Financial Group
		(AU) Senior Notes, 8.20%,
		08/15/2009 (Acquired
		09/16/2005, 12/23/2008
		and 03/10/2009; Cost
		$100,416, $199,780 and
		$248,312, respectively) * f		552,249
	1,550,000	Principal Life
		Income Funding,
		5.10%, 04/15/2014		1,546,959
	950,000	Protective Life Corporation
		Senior Notes,
		4.30%, 06/01/2013		879,522
	1,400,000	Regions Financing Trust II,
		6.625%, 05/01/2077
		(Callable 05/15/2027)		896,000
	705,000	Royal Bank of Scotland
		Group PLC,
		5.00%, 11/12/2013 f		580,678
		Santander Financial
		Issuances: f
	200,000	6.375%, 02/15/2011		199,581
	100,000	7.25%, 11/01/2015		94,332
	2,378,000	Schwab Capital Trust I,
		7.50%, 11/15/2067
		(Callable 11/15/2017)		1,982,325
	50,000	SLM Corporation Senior
		Unsecured Notes,
		5.625%, 08/01/2033		30,784

The accompanying notes are an integral part of these financial statements.

Page 76

Baird Core Plus Bond Fund

Schedule of Investments       June 30, 2009 (Unaudited)

Principal
Amount			Value
LONG-TERM INVESTMENTS – 97.3% (cont.)
Financial – 20.1% (cont.)
		Sovereign Bancorp, Inc.:
$	1,100,000	3.44%, 03/23/2010	$	1,015,157
	643,000	8.75%, 05/30/2018		632,393
	775,000	Travelers Companies, Inc.,
		6.25%, 03/15/2067		624,622
	100,000	UFJ Finance Aruba AEC,
		6.75%, 07/15/2013 f		103,544
	100,000	Unitrin, Inc. Senior
		Unsecured Notes,
		6.00%, 05/15/2017		69,642
	1,400,000	Washington Mutual
		Preferred Funding Trust III,
		6.895%, 12/31/2049
		(Callable 06/15/2012)
		(Acquired 12/12/2007 and
		02/05/2008; Cost
		$726,398 and $136,077,
		respectively) * @		17,500
				42,911,699
Industrial – 14.2%
	420,663	Atlas Air, Inc. Pass-Thru
		Certificates, Series 2000-1,
		8.707%, 07/02/2021		302,878
		Bunge Ltd. Finance
		Corporation Notes:
	150,000	5.35%, 04/15/2014		145,949
	200,000	5.10%, 07/15/2015		183,394
	150,000	CBS Corporation,
		7.70%, 07/30/2010		154,446
		Clear Channel
		Communications Notes:
	375,000	4.50%, 01/15/2010		262,500
	50,000	5.50%, 12/15/2016		10,875
	275,000	Comcast-Cable Holdings,
		7.875%, 08/01/2013		312,886
	175,000	Comcast Corporation,
		6.50%, 01/15/2017		185,651
	500,000	Comcast Holdings
		Corporation,
		10.625%, 07/15/2012		585,000
		Continental Airlines, Inc.
		Pass-Thru Certificates:
	190,849	Series 2000-2, Class C,
		8.312%, 10/02/2012		148,862
	57,251	Series 1997-4,
		6.90%, 01/02/2018		49,809
		COX Communications,
		Inc. Notes:
	600,000	7.875%, 08/15/2009		603,595
	600,000	4.625%, 01/15/2010		602,844
	800,000	5.45%, 12/15/2014		794,150
	750,000	CSX Corporation,
		6.25%, 04/01/2015		775,386
	325,000	Deutsche Telekom
		International Finance BV,
		8.25%, 06/15/2030 f		380,487
	250,000	Donnelley (R.R.)
		& Sons Co.,
		6.125%, 01/15/2017		219,902
	381,366	Federal Express 1995
		Corporation Pass-Thru
		Certificates, Series B2,
		7.11%, 01/02/2014		385,179
	500,000	First Data Corporation,
		9.875%, 09/24/2015
		(Callable 09/30/2011)		355,000
	600,000	Fiserv, Inc.,
		6.125%, 11/20/2012		622,798
	775,000	Ford Motor Company
		Debentures,
		9.215%, 09/15/2021		449,500

The accompanying notes are an integral part of these financial statements.

Page 77

Baird Core Plus Bond Fund

Schedule of Investments       June 30, 2009 (Unaudited)

Principal
Amount			Value
LONG-TERM INVESTMENTS – 97.3% (cont.)
Industrial – 14.2% (cont.)
$	350,000	Georgia Pacific LLC,
		9.50%, 12/01/2011	$	360,500
	500,000	GTE Corporation,
		8.75%, 11/01/2021		568,199
	1,175,000	Hanson Australia Funding,
		5.25%, 03/15/2013 f		923,902
		Hanson PLC Notes: f
	1,150,000	7.875%, 09/27/2010		1,109,750
	350,000	6.125%, 08/15/2016		261,625
	100,000	Health Care Service
		Corporation Notes,
		7.75%, 06/15/2011
		(Acquired 01/26/2005;
		Cost $105,124) *		104,673
	350,000	Health Management
		Association,
		6.125%, 04/15/2016		300,125
		Historic TW, Inc.:
	600,000	9.125%, 01/15/2013		660,601
	92,000	6.875%, 06/15/2018		92,935
	800,000	Humana Inc.,
		7.20%, 06/15/2018		720,913
	825,000	International
		Paper Company,
		7.40%, 06/15/2014		821,253
	125,000	Lafarge S.A. Senior
		Unsecured Notes,
		7.125%, 07/15/2036 f		96,455
	300,000	Martin Marietta
		Materials, Inc.,
		6.25%, 05/01/2037		219,502
	225,000	Masco Corporation,
		6.125%, 10/03/2016		188,909
	250,000	Nabors Industries, Inc.,
		6.15%, 02/15/2018		239,990
		New Cingular
		Wireless Services, Inc.
		Senior Notes:
	700,000	7.875%, 03/01/2011		754,925
	350,000	8.75%, 03/01/2031		426,583
	150,000	Nextel Communications
		Senior Notes, Series E,
		6.875%, 10/31/2013
		(Callable 09/08/2009)		124,125
	50,000	Pactiv Corporation
		Senior Unsecured Notes,
		7.95%, 12/15/2025		46,894
	200,000	PCCW-HWT
		Capital II Ltd.,
		6.00%, 07/15/2013
		(Acquired 07/10/2003;
		Cost $199,066) * f		195,415
	100,000	PCCW-HKT
		Capital III Ltd.,
		5.25%, 07/20/2015
		(Acquired 09/29/2008;
		Cost $84,754) * f		89,641
	75,000	Pearson Dollar Finance PLC,
		5.70%, 06/01/2014
		(Acquired 09/29/2008,
		Cost $73,356) * f		74,183
	575,000	PEMEX Project Funding
		Master Trust,
		9.125%, 10/13/2010		620,310
	1,100,000	Plum Creek Timberlands,
		5.875%, 11/15/2015		929,849
	1,240,000	Premcor Refining Group
		Senior Unsecured Notes,
		7.50%, 06/15/2015
		(Callable 09/08/2009)		1,286,533
	925,000	Rio Tinto Financial USA
		Ltd., 6.50%, 07/15/2018 f		925,539

The accompanying notes are an integral part of these financial statements.

Page 78

Baird Core Plus Bond Fund

Schedule of Investments       June 30, 2009 (Unaudited)

Principal
Amount			Value
LONG-TERM INVESTMENTS – 97.3% (cont.)
Industrial – 14.2% (cont.)
$	610,000	SK Telecom,
		6.625%, 07/20/2027
		(Acquired 07/13/2007,
		09/29/2008 and
		04/08/2009; Cost
		$197,602, $100,537
		and $242,206,
		respectively) * f	$	563,711
		Sprint Capital
		Corporation:
	675,000	6.90%, 05/01/2019		558,563
	300,000	8.75%, 03/15/2032		241,500
	100,000	Sunoco, Inc.
		Senior Unsecured Notes,
		5.75%, 01/15/2017		96,868
		Telecom Italia Capital: f
	340,000	4.95%, 09/30/2014		325,488
	1,425,000	7.20%, 07/18/2036		1,381,652
	300,000	Telefonica Emisiones,
		S.A.U.,
		6.421%, 06/20/2016 f		320,763
		Time Warner, Inc.:
	450,000	7.625%, 04/15/2031		437,470
	95,000	7.70%, 05/01/2032		93,353
	25,000	Time Warner
		Entertainment
		Senior Notes,
		8.875%, 10/01/2012		26,848
	500,000	Transocean, Ltd.,
		6.80%, 03/15/2038 f		534,804
	500,000	Tyco Electronics
		Group S.A.,
		7.125%, 10/01/2037 f		405,136
		Tyco International
		Finance: f
	125,000	6.375%, 10/15/2011		131,717
	50,000	6.00%, 11/15/2013		50,841
		United AirLines, Inc.
		Pass-Thru Certificates:
	164,651	Series 1991-A, Class A-2,
		10.02%, 03/22/2014		55,158
	14,286	Series 2001-1, Class A-2,
		6.201%, 12/31/2049		14,143
	686,771	Series 2000-2, Class C,
		7.762%, 10/01/2049		588,906
	1,000,000	Unitedhealth Group, Inc.
		Senior Unsecured Notes,
		6.00%, 02/15/2018		959,724
		US Airways
		Pass-Thru Trust,
	488,370	Series 1998-1, Class B,
		7.350%, 07/30/2019 # **		290,775
	322,000	USX Corporation,
		9.125%, 01/15/2013		348,324
		Vale Overseas Limited: f
	100,000	8.25%, 01/17/2034		112,471
	250,000	6.875%, 11/21/2036		237,376
	350,000	Verizon New York Inc.
		Senior Unsecured Notes,
		8.625%, 11/15/2010		373,949
	150,000	Viacom, Inc. Senior Notes,
		6.25%, 04/30/2016		147,774
		Vodafone Group PLC: f
	400,000	5.50%, 06/15/2011		420,878
	500,000	6.15%, 02/27/2037		491,926
	500,000	Vulcan Materials,
		7.15%, 11/30/2037		422,700
	75,000	Wellpoint Inc.,
		5.95%, 12/15/2034		60,373

The accompanying notes are an integral part of these financial statements.

Page 79

Baird Core Plus Bond Fund

Schedule of Investments       June 30, 2009 (Unaudited)

Principal
Amount			Value
LONG-TERM INVESTMENTS – 97.3% (cont.)
Industrial – 14.2% (cont.)
$	1,000,000	Woodside Finance Ltd.,
		8.125%, 03/01/2014
		(Acquired 02/24/2009;
		Cost $999,690) * f	$	1,076,318
				30,443,929
Mortgage Backed Securities – 36.5%
		Bank of America
		Alternative Loan Trust:
	140,059	Series 2004-2, Class 5A1,
		5.50%, 03/25/2019		127,465
	151,387	Series 2005-2, Class 4A1,
		5.50%, 03/25/2020		140,270
	312,940	Series 2006-2, Class 6A1,
		5.50%, 03/25/2021		264,923
	121,850	Series 2006-3, Class 6A1,
		6.00%, 04/25/2036		89,217
	293,528	Series 2006-5, Class CB7,
		6.00%, 06/25/2046		200,083
		Chase Mortgage
		Finance Corporation:
	83,848	Series 2003-S13, Class A11,
		5.50%, 11/25/2033		83,577
	700,000	Series 2006-A1, Class 2A3,
		6.00%, 09/25/2036		339,075
	107,139	Citicorp Mortgage
		Securities, Inc.,
		Series 2004-4, Class A5,
		5.50%, 06/25/2034		105,748
		Citigroup Mortgage
		Loan Trust, Inc.:
	302,060	Series 2005-9, Class 2A2,
		5.50%, 11/25/2035		142,937
	191,240	Series 2005-9, Class 22A2,
		6.00%, 11/25/2035		230,075
		Countrywide Alternative
		Loan Trust:
	943,924	Series 2006-7CB, Class
		3A1, 5.25%, 05/25/2021		657,502
	216,392	Series 2006-43CB, Class
		2A1, 6.00%, 02/25/2022		164,120
	1,300,000	Series 2005-10CB, Class
		1A6, 5.50%, 05/25/2035		933,248
	1,434,932	Series 2006-28CB, Class
		A17, 6.00%, 10/25/2036		960,864
	458,235	Series 2006-J2, Class A3,
		6.00%, 04/25/2036		289,112
	105,433	CS First Boston Mortgage
		Securities Corporation,
		Series 2005-11, Class 5A1,
		5.25%, 12/25/2020		94,749
	155,475	Deutsche Alternative
		Securities Inc. Mortgage,
		Series 2005-4, Class A2,
		5.05%, 09/25/2035		146,981
	368,348	Deutsche Securities Inc.
		Mortgage, Series
		2006-AR5, Class 21A,
		6.00%, 10/25/2021		205,693
	103,918	DLJ Commercial
		Mortgage Corporation,
		Series 1999-CG3, Class
		A1B, 7.34%, 10/10/2032		103,804
		Federal Gold Loan Mortgage
		Corporation (FGLMC):
	431,164	5.50%, 11/01/2017		452,723
	453,078	5.00%, 12/01/2020		471,456
	803,584	5.00%, 05/01/2021		836,179
	175,604	6.00%, 06/01/2021		185,937
	126,680	6.50%, 12/01/2028		136,183
	60,504	6.50%, 06/01/2029		65,005
	3,152,974	5.50%, 04/01/2037		3,259,356

The accompanying notes are an integral part of these financial statements.

Page 80

Baird Core Plus Bond Fund

Schedule of Investments       June 30, 2009 (Unaudited)

Principal
Amount			Value
LONG-TERM INVESTMENTS – 97.3% (cont.)
Mortgage Backed Securities – 36.5% (cont.)
		Federal Home Loan
		Mortgage Corporation
		(FHLMC):
$	305,715	Series 3122, Class VA,
		6.00%, 01/15/2017	$	323,402
	2,691,453	Series R010, Class VA,
		5.50%, 04/15/2017		2,884,023
	1,591,919	Series R010, Class AB,
		5.50%, 12/15/2019		1,638,268
	13,457	Series 1053, Class G,
		7.00%, 03/15/2021		14,406
	30,015	Series 136, Class E,
		6.00%, 04/15/2021		31,318
	236,356	Series 2804, Class VC,
		5.00%, 07/15/2021		247,784
	25,194	Series 1122, Class G,
		7.00%, 08/15/2021		26,781
	58,221	Series 1186, Class I,
		7.00%, 12/15/2021		58,194
	138,977	Series 3132, Class MA,
		5.50%, 12/15/2023		144,654
	209,175	Series 2598, Class QC,
		4.50%, 06/15/2027		210,445
		Federal National Mortgage
		Association (FNMA):
	1,657,225	5.50%, 03/01/2023		1,724,889
	665,586	5.50%, 07/01/2023		692,762
	920,212	5.50%, 12/01/2023		957,784
	230,313	6.00%, 03/01/2026		242,506
	1,289,859	5.00%, 05/01/2028		1,322,559
	101,439	6.50%, 09/01/2028		109,366
	198,391	6.50%, 02/01/2029		213,894
	154,508	5.50%, 01/01/2032		160,470
	1,672,075	5.50%, 04/01/2034		1,735,023
	4,265,383	5.50%, 04/01/2034		4,420,262
	170,454	5.50%, 02/01/2035		176,764
	2,886,933	5.50%, 02/01/2035		2,993,811
	4,674,974	5.00%, 02/01/2036		4,776,326
	14,171,181	5.50%, 04/01/2036		14,682,534
	1,749,824	6.00%, 08/01/2037		1,825,866
	12,460	Series 1989-94, Class G,
		7.50%, 12/25/2019		13,680
	52,528	Series 1990-15, Class J,
		7.00%, 02/25/2020		56,993
	10,367	Series 1991-21, Class J,
		7.00%, 03/25/2021		11,193
	192,519	Series 1991-43, Class J,
		7.00%, 05/25/2021		208,591
	254,442	Series 1991-65, Class Z,
		6.50%, 06/25/2021		270,564
	386,420	Series 1992-129, Class L,
		6.00%, 07/25/2022		400,850
	1,047,506	Series 2003-33, Class LD,
		4.25%, 09/25/2022		1,080,082
	75,846	Series 1993-32, Class H,
		6.00%, 03/25/2023		80,259
	408,903	Series 1993-58, Class H,
		5.50%, 04/25/2023		437,513
	86,093	Series 2003-31, Class KG,
		4.50%, 12/25/2028		86,990
	2,056,756	Series 2002-85, Class PD,
		5.50%, 05/25/2031		2,119,386
	34,170	Series 2003-44, Class AB,
		3.75%, 05/25/2033		34,009
	816,269	Series 2004-W6, Class
		1A4, 5.50%, 07/25/2034		764,199
	701,192	Series 2004-W6, Class
		1A6, 5.50%, 07/25/2034		732,526
	1,500,000	Series 2004-W10, Class
		A4, 5.75%, 08/25/2034		1,407,719

The accompanying notes are an integral part of these financial statements.

Page 81

Baird Core Plus Bond Fund

Schedule of Investments       June 30, 2009 (Unaudited)

Principal
Amount			Value
LONG-TERM INVESTMENTS – 97.3% (cont.)
Mortgage Backed Securities – 36.5% (cont.)
		First Horizon Alternative
		Mortgage Securities:
$	217,783	Series 2006-FA6, Class
		3A1, 5.75%, 11/25/2021	$	176,064
	1,667,080	Series 2006-FA8, Class
		2A1, 5.75%, 02/25/2037		932,450
	1,075,000	First Union National Bank
		Commercial Mortgage
		Securities Inc., Series
		2001-C4, Class A2,
		6.223%, 12/12/2033		1,105,425
		GE Capital Commercial
		Mortgage Corporation:
	1,160,748	Series 2000-1, Class A2,
		6.496%, 01/15/2033		1,172,187
	1,610,000	Series 2003-C2, Class A4,
		5.145%, 07/10/2037		1,520,647
	950,000	Series 2004-C3, Class A4,
		5.189%, 07/10/2039		847,343
		GMAC Commercial
		Mortgage Securities, Inc.:
	236,107	Series 2001-C1, Class A2,
		6.465%, 04/15/2034		240,045
	1,750,000	Series 2003-C1, Class A2,
		4.079%, 05/10/2036		1,630,785
		Government National
		Mortgage Association
		(GNMA):
	115,558	6.00%, 12/20/2028		120,903
	44,581	6.50%, 01/20/2029		48,017
	110,358	6.00%, 11/20/2033		114,999
	580,391	Series 2003-2, Class PB,
		5.50%, 03/20/2032		600,664
		J.P. Morgan Alternative
		Loan Trust:
	1,539,013	Series 2005-S1, Class
		3A1, 5.50%, 10/25/2020		1,041,239
	253,680	Series 2006-A1, Class
		2A1, 5.799%, 03/25/2036		143,293
	300,000	Series 2006-S3, Class A3A,
		6.00%, 08/25/2036		165,666
		J.P. Morgan Mortgage Trust:
	850,000	Series 2006-A7, Class
		2A4R, 5.457%, 01/25/2037		449,101
	950,000	Series 2007-A2, Class 2A3,
		5.715%, 04/25/2037		530,292
		Master Alternative
		Loans Trust:
	778,423	Series 2004-1, Class 1A1,
		5.00%, 01/25/2019		688,661
	485,481	Series 2005-3, Class 4A1,
		5.50%, 03/25/2020		391,685
	160,616	Series 2003-5, Class 6A1,
		6.00%, 08/25/2033		135,695
	139,614	Merrill Lynch Mortgage
		Investors Trust, Series
		2005-A8, Class A1C1,
		5.25%, 08/25/2036		122,236
	210,373	Residential Accredit Loans,
		Inc., Series 2005-QS2,
		Class A1, 5.50%,
		02/25/2035		173,683
		Salomon Brothers Mortgage
		Securities VII:
	398,680	Series 2000-C1, Class A2,
		7.52%, 12/18/2009		401,122
	1,829,334	Series 2001-C2, Class A3,
		6.50%, 10/13/2011		1,877,529

The accompanying notes are an integral part of these financial statements.

Page 82

Baird Core Plus Bond Fund

Schedule of Investments       June 30, 2009 (Unaudited)

Principal
Amount			Value
LONG-TERM INVESTMENTS – 97.3% (cont.)
Mortgage Backed Securities – 36.5% (cont.)
$	1,208,079	Series 2000-C2, Class A2,
		7.455%, 07/18/2033	$	1,225,808
	1,250,000	Wachovia Bank
		Commercial Mortgage
		Trust, Series 2003-C3,
		Class A2, 4.867%,
		02/15/2035		1,160,370
		Washington Mutual, Inc.
		Pass-Thru Certificates:
	296,388	Series 2004-CB1, Class 5A,
		5.00%, 06/25/2019		291,850
	523,769	Series 2004-CB2, Class 7A,
		5.50%, 08/25/2019		495,780
	173,750	Series 2004-CB3, Class 4A,
		6.00%, 10/25/2019		157,841
	276,195	Series 2004-CB4, Class
		22A, 6.00%, 12/25/2019		249,279
				78,215,586
Taxable Municipal Bonds – 0.9%
	2,610,000	Tobacco Settlement
		Authority Iowa,
		6.50%, 06/01/2023		1,952,410
	45,046	Tobacco Settlement
		Financing Corporation,
		Series 2001-A, Class A,
		6.36%, 05/15/2025		41,482
				1,993,892
Utilities – 7.7%
	1,000,000	Ameren Corporation,
		8.875%, 05/15/2014		1,032,139
	300,000	Appalachian Power
		Company Senior Unsecured
		Notes, 6.70%, 08/15/2037		299,482
	1,000,000	Arizona Pubic Service
		Senior Unsecured Notes,
		8.75%, 03/01/2019		1,090,284
	165,000	Cilcorp Inc. Senior Notes,
		8.70%, 10/15/2009		161,700
	750,000	Commonwealth Edison,
		5.40%, 12/15/2011		784,468
	500,000	Encana Corporation
		6.50%, 05/15/2019 f		536,003
	500,000	Enel Finance International,
		6.80%, 09/15/2037
		(Acquired 09/13/2007
		and 9/29/2008; Cost
		$398,940 and $99,957,
		respectively) * f		518,350
	150,000	Energy Transfer Partners,
		5.65%, 08/01/2012		152,965
	225,000	Exelon Corporation
		Senior Unsecured Notes,
		5.625%, 06/15/2035		181,112
	1,000,000	FPL Group Capital, Inc.,
		Series D, 7.30%,
		09/01/2067 (Callable
		09/01/2017)		850,000
	542,572	GG1C Funding
		Corporation,
		5.129%, 01/15/2014
		(Acquired 11/21/2008;
		Cost $519,659) *		499,356
		Kinder Morgan Energy
		Partners Senior Notes:
	100,000	6.50%, 02/01/2037		91,321
	250,000	6.95%, 01/15/2038		242,173
	300,000	Kinder Morgan Finance,
		5.70%, 01/05/2016 f		257,250

The accompanying notes are an integral part of these financial statements.

Page 83

Baird Core Plus Bond Fund

Schedule of Investments       June 30, 2009 (Unaudited)

Principal
Amount			Value
LONG-TERM INVESTMENTS – 97.3% (cont.)
Utilities – 7.7% (cont.)
$	57,461	Kiowa Power Partners LLC,
		4.811%, 12/30/2013
		(Acquired 11/19/2004;
		Cost $60,236) *	$	52,947
	115,000	Korea Electric Power
		Corporation,
		6.75%, 08/01/2027 f		87,416
	1,000,000	Marathon Oil Corporation
		Senior Unsecured Notes,
		7.50%, 02/15/2019		1,091,452
	800,000	MidAmerican Funding,
		LLC, 6.75%, 03/01/2011		854,359
	100,000	National Grid PLC
		Senior Unsecured Notes,
		6.30%, 08/01/2016 f		102,739
		National Rural Utilities
		Senior Unsecured Notes:
	200,000	7.25%, 03/01/2012		218,447
	600,000	10.375%, 11/01/2018		752,294
		Nisource Finance
		Corporation:
	536,000	6.15%, 03/01/2013		532,800
	1,583,000	5.40%, 07/15/2014		1,497,863
	800,000	ONEOK, Inc.
		Senior Notes,
		7.125%, 04/15/2011		843,470
	475,000	Pepco Holdings, Inc.,
		Senior Notes,
		6.125%, 06/01/2017		439,981
	200,000	PPL Energy Supply LLC
		Senior Unsecured Notes,
		6.20%, 05/15/2016		199,199
	100,000	PPL Energy Supply,
		LLC Bonds, Series A,
		5.70%, 10/15/2015		100,929
	200,000	PSE&G Energy Holdings
		LLC Senior Notes,
		8.50%, 06/15/2011		201,923
	500,000	Public Service Company
		Of New Mexico,
		7.95%, 05/15/2018		485,419
	284,470	RGS (I&M) Funding
		Corporation Debentures,
		9.82%, 12/07/2022		311,286
	300,000	Southern Natural Gas,
		5.90%, 04/01/2017
		(Acquired 03/14/2007;
		Cost $299,502) *		290,552
	1,100,000	Spectra Energy Capital,
		5.668%, 08/15/2014		1,110,737
		Williams Cos. Inc. Notes:
	175,000	7.125%, 09/01/2011		178,474
	350,000	7.875%, 09/01/2021		344,750
				16,393,640
U.S. Treasury Obligations – 10.6%
	18,550,000	U.S. Treasury Bonds,
		6.25%, 08/15/2023		22,596,219
		Total Long-Term
		Investments
		(Cost $217,504,078)		208,273,185
Shares
SHORT-TERM INVESTMENTS – 1.6%
Money Market Fund – 1.6%
	3,382,045	Short-Term Investment
		Company Liquid Assets
		Portfolio – AIM Fund		3,382,045
		Total Short-Term
		Investments
		(Cost $3,382,045)		3,382,045

The accompanying notes are an integral part of these financial statements.

Page 84

Baird Core Plus Bond Fund

Schedule of Investments       June 30, 2009 (Unaudited)

Principal
Amount			Value
INVESTMENTS PURCHASED
WITH CASH PROCEEDS FROM
SECURITIES LENDING – 21.7%
Commercial Paper – 0.2%
$	410,573	Atlantic East
		Funding LLC,
		3.059%, 03/25/10 # **	$	410,573
				410,573
Corporate Bond – 0.3%
	765,354	Svenska Handelsbanken,
		4.418%, 08/06/09 f		765,354
				765,354
Shares
Investment Companies – 21.2%
	45,066,963	Mount Vernon
		Securities Lending
		Trust Prime Portfolio		45,066,963
	330,696	Reserve Primary
		Fund # **		330,696
				45,397,659
		Total Investments
		Purchased With Cash
		Proceeds From
		Securities Lending
		(Cost $46,573,586)		46,573,586
		Total Investments
		(Cost $267,459,709) –
		120.6%		258,228,816
		Liabilities in Excess of
		Other Assets – (20.6)%		(44,159,046	)
		TOTAL NET
		ASSETS – 100.0%	$	214,069,770

* Restricted Security Deemed Liquid

** Illiquid Security

f Foreign Security

# Priced at Fair Value by the Valuation Committee as delegated by the Baird Funds’ Board of Directors

@ Security in Default

The accompanying notes are an integral part of these financial statements.

Page 85

Baird Core Plus Bond Fund

Schedule of Investments       June 30, 2009 (Unaudited)

SFAS 157 – Summary of Fair Value Exposure at June 30, 2009

As adopted by the Fund, the Financial Accounting Standards Board issued Statement of Financial Accounting Standards No. 157, “Fair Value Measurements” (“SFAS 157”) defines fair value, establishes a framework for measuring fair value in generally accepted accounting principles (GAAP), and expands disclosures about fair value measurements.  Under SFAS 157, various inputs are used in determining the value of the Fund’s investments.  These inputs are summarized into three broad levels and described below:

Level 1 –	Quoted prices in active markets for identical securities.
Level 2 –	Other significant observable inputs (including quoted prices for similar securities, quoted prices for identical securities in inactive markets, dealer indications, interest rates, yield curves, benchmark yields, issuer spreads, prepayment speeds, cash flows, credit risk, default rates, information about issuers, sectors and markets, inputs corroborated by observable market data, etc.)
Level 3 –	Significant unobservable inputs (including the Fund’s own assumptions about the assumptions that market participants would use in pricing the security).

The inputs or methodology used for valuing securities are not necessarily an indication of the risk associated with investing in those securities.

The following is a summary of the inputs used to value the Fund’s investments as of June 30, 2009:

	Level 1		Level 2		Level 3		Total
Fixed Income
Asset Backed Securities	$	—	$	15,518,220	$	200,000	$	15,718,220
Corporate Debt Securities		—		89,458,493		290,775		89,749,268
Mortgage Backed Securities		—		78,215,586		—		78,215,586
Taxable Municipal Bonds		—		1,993,892		—		1,993,892
U.S. Treasury Obligations		—		22,596,219		—		22,596,219
Total Fixed Income		—		207,782,410		490,775		208,273,185
Short-Term Investments
Money Market Mutual Funds		3,382,045		—		—		3,382,045
Total Short-Term Investments		3,382,045		—		—		3,382,045
Investments Purchased With Cash
Proceeds From Securities Lending
Commercial Paper		—		410,573		—		410,573
Corporate Bonds		—		765,354		—		765,354
Money Market Mutual Funds		45,066,963		—		330,696		45,397,659
Total Investments Purchased With Cash
Proceeds From Securities Lending		45,066,963		1,175,927		330,696		46,573,586
Total Investments in Securities	$	48,449,008	$	208,958,337	$	821,471	$	258,228,816

Page 86

Baird Core Plus Bond Fund

Schedule of Investments       June 30, 2009 (Unaudited)

Level 3 Reconciliation Disclosure

Following is a reconciliation of Level 3 assets for which significant unobservable inputs were used to determine fair value.

Description	Investments in Securities
Balance as of December 31, 2008	$	1,211,045
Accrued discounts/premiums		—
Realized gain (loss)		14,671
Change in unrealized appreciation (depreciation)		195,552
Net purchases (sales/paydowns)		(533,114	)
Transfers in and/or out of Level 3 *		(66,683	)
Balance as of June 30, 2009	$	821,471
Change in unrealized appreciation (depreciation) during
the year for level 3 investments held at June 30, 2009.		195,552

* The information used in the above reconciliation represents fiscal year to date activity for any investments identified as using Level 3 inputs at either the beginning or end of the current fiscal period.  Transfers in or out of Level 3 represents either the beginning value (for transfers in) or ending value (for transfers out) of any security or instrument where a change in the pricing level occurred from the beginning to the end of the period.

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Baird Funds, Inc.

Additional Information on Fund Expenses       June 30, 2009 (Unaudited)

Example

As a shareholder of a mutual fund, you incur two types of costs: (1) transaction costs, which may include sales charges (loads) on purchase payments, reinvested dividends, or other distributions; redemption fees; and exchange fees; and (2) ongoing costs, such as management fees; distribution and/or service (12b-1) fees;  and other fund expenses.  Although the Funds do not charge any sales loads, redemption fees, or other transaction fees, you will be assessed fees for outgoing wire transfers, returned checks and stop payment orders at prevailing rates charged by U.S. Bancorp Fund Services, LLC, the Funds’ transfer agent.  If you request that a redemption be made by wire transfer, currently the Funds’ transfer agent charges a $15.00 fee.

This Example is intended to help you understand your ongoing costs (in dollars) of investing in each Fund and to compare these costs with the ongoing costs of investing in other mutual funds.  The Example is based on an investment of $1,000 invested at the beginning of the period and held for the entire period (1/1/09 – 6/30/09).

Actual Expenses

The third and fourth columns of the following table provide information about account values based on actual returns and actual expenses.  You may use the information in these columns, together with the amount you invested, to estimate the expenses that you paid over the period. Simply divide your account value by $1,000 (for example, an $8,600 account value divided by $1,000 = 8.6), then multiply the result by the number in the fourth column entitled “Expenses Paid During Period’’ to estimate the expenses you paid on your account during this period.

Hypothetical Example for Comparison Purposes

The fifth and sixth columns of the following table provide information about hypothetical account values and hypothetical expenses based on the Funds’ actual expense ratios and an assumed rate of return of 5% per year before expenses, which is not the Funds’ actual return. The hypothetical account values and expenses may not be used to estimate the actual ending account balance or expenses you paid for the period. You may use this information to compare the ongoing costs of investing in the Funds and other mutual funds. To do so, compare this 5% hypothetical example with the 5% hypothetical examples that appear in the shareholder reports of the other mutual funds.  Please note that the expenses shown in the table are meant to highlight your ongoing costs only and do not reflect any transactional costs.  Therefore, the sixth column of the table (entitled “Expenses Paid During Period”) is useful in comparing ongoing costs only, and will not help you determine the relative total costs of owning different mutual funds. In addition, if these transactional costs were included, your costs could have been higher.

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Baird Funds, Inc.

Additional Information on Fund Expenses       June 30, 2009 (Unaudited)

Actual vs. Hypothetical Returns

For the Six Months Ended June 30, 2009

					Hypothetical (5% return
			Actual		before expenses)
	Fund’s	Beginning	Ending	Expenses	Ending	Expenses
	Annualized	Account	Account	Paid	Account	Paid
	Expense	Value	Value	During	Value	During
	Ratio(1)	1/1/09	6/30/09	Period(1)	6/30/09	Period(1)
Baird Short-Term Bond Fund
Institutional Class	0.30%	$1,000.00	$1,038.60	$1.52	$1,023.31	$1.51
Baird Intermediate Bond Fund
Institutional Class	0.30%	$1,000.00	$1,053.00	$1.53	$1,023.31	$1.51
Investor Class	0.55%	$1,000.00	$1,051.10	$2.80	$1,022.07	$2.76
Baird Intermediate Municipal
Bond Fund
Institutional Class	0.30%	$1,000.00	$1,026.10	$1.51	$1,023.31	$1.51
Investor Class	0.55%	$1,000.00	$1,024.60	$2.76	$1,022.07	$2.76
Baird Aggregate Bond Fund
Institutional Class	0.30%	$1,000.00	$1,038.70	$1.52	$1,023.31	$1.51
Investor Class	0.55%	$1,000.00	$1,036.50	$2.78	$1,022.07	$2.76
Baird Core Plus Bond Fund
Institutional Class	0.30%	$1,000.00	$1,058.50	$1.53	$1,023.31	$1.51
Investor Class	0.55%	$1,000.00	$1,057.70	$2.81	$1,022.07	$2.76

(1) Expenses are equal to the Fund’s annualized net expense ratio multiplied by the average account value over the period, multiplied by 181 days and divided by 365 to reflect the one-half year period.

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Baird Funds, Inc.

Statements of Assets and Liabilities       June 30, 2009 (Unaudited)

							Baird
	Baird			Baird			Intermediate			Baird			Baird
	Short-Term			Intermediate			Municipal			Aggregate			Core Plus
	Bond Fund			Bond Fund			Bond Fund			Bond Fund			Bond Fund
ASSETS:
Investments, at value	$	479,799,380		$	646,238,935		$	492,241,064		$	1,276,577,977		$	258,228,816
(cost $488,711,548; $664,972,598;
$483,308,825; $1,334,468,592;
& $267,459,709, respectively)
Interest receivable		4,233,485			5,519,370			5,998,625			10,599,404			2,581,655
Receivable for investments sold or paid down		—			13,910			—			23,616			3,350
Receivable for Fund shares sold		2,322,700			1,816,617			4,201,940			7,997,709			267,371
Total assets		486,355,565			653,588,832			502,441,629			1,295,198,706			261,081,192
LIABILITIES:
Payable for collateral received
for securities loaned (See Note 6)		97,121,530			185,115,199			—			268,529,246			46,573,586
Payable for securities purchased		4,238,994			2,989,166			1,226,328			38,059,904			—
Payable for Fund shares repurchased		9,242,800			709,429			158,976			808,112			145,977
Payable to Advisor and Distributor		92,387			111,345			157,254			242,277			61,735
Payable to the Custodian		51,911			509,938			—			981,834			174,325
Other liabilities		19,558			138,828			—			259,285			55,799
Total liabilities		110,767,180			189,573,905			1,542,558			308,880,658			47,011,422
NET ASSETS	$	375,588,385		$	464,014,927		$	500,899,071		$	986,318,048		$	214,069,770
NET ASSETS CONSIST OF:
Capital stock	$	384,258,502		$	480,787,373		$	492,465,229		$	1,040,912,314		$	221,787,272
Accumulated undistributed
net investment income		286,626			247,184			225,200			618,303			224,597
Accumulated net realized
gain (loss) on investments sold		(44,575	)		1,714,033			(723,597	)		2,678,046			1,288,794
Net unrealized appreciation (depreciation)
on investments		(8,912,168	)		(18,733,663	)		8,932,239			(57,890,615	)		(9,230,893	)
NET ASSETS	$	375,588,385		$	464,014,927		$	500,899,071		$	986,318,048		$	214,069,770
INSTITUTIONAL CLASS SHARES
Net Assets	$	375,588,385		$	458,225,071		$	375,144,235		$	954,986,749		$	176,839,118
Shares outstanding ($0.01 par value,
unlimited shares authorized)		40,093,665			44,681,612			33,744,943			97,070,398			18,263,243
Net asset value, offering and
redemption price per share	$	9.37		$	10.26		$	11.12		$	9.84		$	9.68
INVESTOR CLASS SHARES
Net Assets				$	5,789,856		$	125,754,836		$	31,331,299		$	37,230,652
Shares outstanding ($0.01 par value,
unlimited shares authorized)					546,550			11,099,928			3,109,930			3,735,501
Net asset value, offering and
redemption price per share				$	10.59		$	11.33		$	10.07		$	9.97

The accompanying notes are an integral part of these financial statements.

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Baird Funds, Inc.

Statements of Operations       Period Ended June 30, 2009 (Unaudited)

						Baird
	Baird			Baird		Intermediate			Baird		Baird
	Short-Term			Intermediate		Municipal			Aggregate		Core Plus
	Bond Fund			Bond Fund		Bond Fund			Bond Fund		Bond Fund
INVESTMENT INCOME:
Interest income	$	7,906,652		$	11,223,234	$	6,052,312		$	26,692,892	$	7,158,590
Income from securities lending (Note 6)		72,125			206,225		—			281,261		59,134
Other income		39,881			40,713		2,439			23,514		43,271
Total investment income		8,018,658			11,470,172		6,054,751			26,997,667		7,260,995
EXPENSES:
Investment advisory fee		370,684			524,461		470,713			1,112,914		254,678
Administration fee		74,137			104,893		94,143			222,583		50,936
Distribution expense –
Investor Class Shares (Note 8)		—			5,503		97,287			38,105		43,058
Total expenses		444,821			634,857		662,143			1,373,602		348,672
NET INVESTMENT INCOME		7,573,837			10,835,315		5,392,608			25,624,065		6,912,323
REALIZED AND UNREALIZED
GAIN ON INVESTMENTS:
Net realized gain (loss) on investments		(21,814	)		777,738		(107,633	)		3,068,360		841,865
Change in unrealized appreciation/
depreciation on investments		4,505,688			10,120,659		1,550,349			6,432,277		4,446,267
Net realized and unrealized
gain on investments		4,483,874			10,898,397		1,442,716			9,500,637		5,288,132
NET INCREASE IN NET ASSETS
RESULTING FROM OPERATIONS	$	12,057,711		$	21,733,712	$	6,835,324		$	35,124,702	$	12,200,455

The accompanying notes are an integral part of these financial statements.

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Baird Funds, Inc.

Statements of Changes in Net Assets

	Baird Short-Term Bond Fund
	Six Months Ended
	June 30, 2009			Year Ended
	(Unaudited)			December 31, 2008
OPERATIONS:
Net investment income	$	7,573,837		$	11,305,735
Net realized gain (loss) on investments		(21,814	)		217,036
Change in unrealized appreciation/depreciation on investments		4,505,688			(14,687,311	)
Net increase (decrease) in net assets resulting from operations		12,057,711			(3,164,540	)
CAPITAL SHARE TRANSACTIONS:
Proceeds from shares sold		222,821,579			178,053,687
Shares issued to holders in reinvestment of dividends		6,612,017			10,505,667
Cost of shares redeemed		(73,582,535	)		(158,184,075	)
Net increase in net assets resulting
from capital share transactions		155,851,061			30,375,279
DISTRIBUTIONS TO
INSTITUTIONAL CLASS SHAREHOLDERS:
From net investment income		(7,319,793	)		(11,301,816	)
TOTAL INCREASE IN NET ASSETS		160,588,979			15,908,923
NET ASSETS:
Beginning of period		214,999,406			199,090,483
End of period (including undistributed net investment
income of $286,626 and $32,582, respectively)	$	375,588,385		$	214,999,406

The accompanying notes are an integral part of these financial statements.

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Baird Funds, Inc.

Statements of Changes in Net Assets

	Baird Intermediate Bond Fund
	Six Months Ended
	June 30, 2009			Year Ended
	(Unaudited)			December 31, 2008
OPERATIONS:
Net investment income	$	10,835,315		$	22,412,911
Net realized gain on investments		777,738			3,440,473
Change in unrealized appreciation/depreciation on investments		10,120,659			(30,956,520	)
Net increase (decrease) in net assets resulting from operations		21,733,712			(5,103,136	)
CAPITAL SHARE TRANSACTIONS:
Proceeds from shares sold		85,752,167			142,640,099
Shares issued to holders in reinvestment of dividends		8,937,769			19,625,331
Cost of shares redeemed		(47,666,097	)		(130,271,025	)
Net increase in net assets resulting
from capital share transactions		47,023,839			31,994,405
DISTRIBUTIONS TO
INSTITUTIONAL CLASS SHAREHOLDERS:
From net investment income		(10,570,872	)		(22,354,849	)
From net realized gains		—			(26,596	)
Total Distributions		(10,570,872	)		(22,381,445	)
DISTRIBUTIONS TO
INVESTOR CLASS SHAREHOLDERS:
From net investment income		(104,452	)		(174,810	)
From net realized gains		—			(231	)
Total Distributions		(104,452	)		(175,041	)
TOTAL INCREASE IN NET ASSETS		58,082,227			4,334,783
NET ASSETS:
Beginning of period		405,932,700			401,597,917
End of period (including undistributed net investment
income of $247,183 and $87,193, respectively)	$	464,014,927		$	405,932,700

The accompanying notes are an integral part of these financial statements.

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Baird Funds, Inc.

Statements of Changes in Net Assets

	Baird Intermediate Municipal Bond Fund
	Six Months Ended
	June 30, 2009			Year Ended
	(Unaudited)			December 31, 2008
OPERATIONS:
Net investment income	$	5,392,608		$	5,141,918
Net realized loss on investments		(107,633	)		(274,006	)
Change in unrealized appreciation/depreciation on investments		1,550,349			5,662,406
Net increase in net assets resulting from operations		6,835,324			10,530,318
CAPITAL SHARE TRANSACTIONS:
Proceeds from shares sold		333,287,707			160,219,164
Shares issued to holders in reinvestment of dividends		4,516,114			4,513,442
Cost of shares redeemed		(82,136,248	)		(33,490,109	)
Net increase in net assets resulting
from capital share transactions		255,667,573			131,242,497
DISTRIBUTIONS TO
INSTITUTIONAL CLASS SHAREHOLDERS:
From net investment income		(4,122,434	)		(5,091,785	)
DISTRIBUTIONS TO
INVESTOR CLASS SHAREHOLDERS:
From net investment income		(1,044,974	)		(97,675	)
TOTAL INCREASE IN NET ASSETS		257,335,489			136,583,355
NET ASSETS:
Beginning of period		243,563,582			106,980,227
End of period (including undistributed net investment
income of $225,200 and $0, respectively)	$	500,899,071		$	243,563,582

The accompanying notes are an integral part of these financial statements.

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Baird Funds, Inc.

Statements of Changes in Net Assets

	Baird Aggregate Bond Fund
	Six Months Ended
	June 30, 2009			Year Ended
	(Unaudited)			December 31, 2008
OPERATIONS:
Net investment income	$	25,624,065		$	44,829,005
Net realized gain on investments		3,068,360			1,031,139
Change in unrealized appreciation/depreciation on investments		6,432,277			(67,458,374	)
Net increase (decrease) in net assets resulting from operations		35,124,702			(21,598,230	)
CAPITAL SHARE TRANSACTIONS:
Proceeds from shares sold		226,122,917			380,122,590
Shares issued to holders in reinvestment of dividends		20,535,544			36,137,185
Cost of shares redeemed		(142,330,234	)		(217,594,354	)
Net increase in net assets resulting
from capital share transactions		104,328,227			198,665,421
DISTRIBUTIONS TO
INSTITUTIONAL CLASS SHAREHOLDERS:
From net investment income		(24,206,145	)		(43,763,255	)
DISTRIBUTIONS TO
INVESTOR CLASS SHAREHOLDERS:
From net investment income		(799,617	)		(1,376,855	)
TOTAL INCREASE IN NET ASSETS		114,447,167			131,927,081
NET ASSETS:
Beginning of period		871,870,881			739,943,800
End of period (including undistributed net investment
income of $618,303 and $0, respectively)	$	986,318,048		$	871,870,881

The accompanying notes are an integral part of these financial statements.

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Baird Funds, Inc.

Statements of Changes in Net Assets

	Baird Core Plus Bond Fund
	Six Months Ended
	June 30, 2009			Year Ended
	(Unaudited)			December 31, 2008
OPERATIONS:
Net investment income	$	6,912,323		$	9,185,656
Net realized gain on investments		841,865			1,160,853
Change in unrealized appreciation/depreciation on investments		4,446,267			(14,240,961	)
Net increase (decrease) in net assets resulting from operations		12,200,455			(3,894,452	)
CAPITAL SHARE TRANSACTIONS:
Proceeds from shares sold		59,731,983			134,885,428
Shares issued to holders in reinvestment of dividends		5,930,870			8,307,982
Cost of shares redeemed		(45,672,726	)		(57,613,955	)
Net increase in net assets resulting
from capital share transactions		19,990,127			85,579,455
DISTRIBUTIONS TO INSTITUTIONAL CLASS SHAREHOLDERS:
From net investment income		(5,604,397	)		(7,991,266	)
From net realized gains		—			(689,704	)
Total Distributions		(5,604,397	)		(8,680,970	)
DISTRIBUTIONS TO INVESTOR CLASS SHAREHOLDERS:
From net investment income		(1,083,328	)		(1,208,915	)
From net realized gains		—			(123,760	)
Total Distributions		(1,083,328	)		(1,332,675	)
TOTAL INCREASE IN NET ASSETS		25,502,857			71,671,358
NET ASSETS:
Beginning of period		188,566,913			116,895,555
End of period (including undistributed net investment
income of $224,597 and $0, respectively)	$	214,069,770		$	188,566,913

The accompanying notes are an integral part of these financial statements.

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Baird Funds, Inc.

Financial Highlights

	Baird Short-Term Bond Fund – Institutional Class
	Six Months
	Ended															August 31, 2004(1)
	June 30, 2009			Year Ended December 31,												through
	(Unaudited)			2008			2007			2006			2005			December 31, 2004
Per Share Data:
Net asset value, beginning of period	$	9.25		$	9.91		$	9.81		$	9.79		$	9.93		$	10.00
Income from investment operations:
Net investment income		0.23			0.52			0.48			0.43			0.33			0.08
Net realized and unrealized
gains (losses) on investments		0.11			(0.67	)		0.10			0.02			(0.15	)		(0.07	)
Total from investment operations		0.34			(0.15	)		0.58			0.45			0.18			0.01
Less distributions:
Dividends from net investment income		(0.22	)		(0.51	)		(0.48	)		(0.43	)		(0.32	)		(0.08	)
Net asset value, end of period	$	9.37		$	9.25		$	9.91		$	9.81		$	9.79		$	9.93
Total return		3.86	%(2)		(1.79	)%		6.08	%		4.65	%		1.85	%		0.10	%(2)
Supplemental data and ratios:
Net assets, end of period	$	375,588,385		$	214,999,406		$	199,090,483		$	148,604,711		$	97,057,968		$	31,973,000
Ratio of expenses to average net assets		0.30	%(3)		0.30	%		0.30	%		0.30	%		0.30	%		0.30	%(3)
Ratio of net investment income
to average net assets		5.11	%(3)		5.01	%		5.00	%		4.48	%		3.52	%		2.60	%(3)
Portfolio turnover rate(4)		32.3	%(2)		98.5	%		36.6	%		41.1	%		31.8	%		16.7	%(2)

(1) Commencement of operations.

(2) Not annualized.

(3) Annualized.

(4) Portfolio turnover is calculated on the basis of the Fund as a whole without distinguishing between the classes of shares issued.

The accompanying notes are an integral part of these financial statements.

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Baird Funds, Inc.

Financial Highlights

	Baird Intermediate Bond Fund – Institutional Class
	Six Months
	Ended
	June 30, 2009			Year Ended December 31,
	(Unaudited)			2008			2007			2006			2005			2004
Per Share Data:
Net asset value, beginning of period	$	10.00		$	10.62		$	10.52		$	10.55		$	10.83		$	10.88
Income from investment operations:
Net investment income		0.25	(1)		0.55			0.54			0.51			0.46			0.47	(1)
Net realized and unrealized
gains (losses) on investments		0.26			(0.64	)		0.10			(0.03	)		(0.27	)		(0.05	)
Total from investment operations		0.51			(0.09	)		0.64			0.48			0.19			0.42
Less distributions:
Dividends from net investment income		(0.25	)		(0.53	)		(0.54	)		(0.51	)		(0.47	)		(0.47	)
Distributions from net realized gains		—			—			—			—			—			(0.00	)(2)
Total distributions		(0.25	)		(0.53	)		(0.54	)		(0.51	)		(0.47	)		(0.47	)
Net asset value, end of period	$	10.26		$	10.00		$	10.62		$	10.52		$	10.55		$	10.83
Total return		5.30	%(3)		(0.91	)%		6.24	%		4.70	%		1.77	%		3.91	%
Supplemental data and ratios:
Net assets, end of period	$	458,225,071		$	401,914,872		$	398,321,566		$	326,835,399		$	231,800,807		$	191,563,699
Ratio of expenses to average net assets		0.30	%(4)		0.30	%		0.30	%		0.30	%		0.30	%		0.30	%
Ratio of net investment income
to average net assets		5.17	%(4)		5.14	%		5.13	%		4.90	%		4.34	%		4.32	%
Portfolio turnover rate(5)		16.7	%(3)		32.9	%		42.5	%		44.8	%		42.1	%		44.8	%

(1) Calculated using average shares outstanding during the period.

(2) Amount is less than $0.01.

(3) Not annualized.

(4) Annualized.

(5) Portfolio turnover is calculated on the basis of the Fund as a whole without distinguishing between the classes of shares issued.

The accompanying notes are an integral part of these financial statements.

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Baird Funds, Inc.

Financial Highlights

	Baird Intermediate Bond Fund – Investor Class
	Six Months
	Ended
	June 30, 2009			Year Ended December 31,
	(Unaudited)			2008			2007			2006			2005			2004
Per Share Data:
Net asset value, beginning of period	$	10.32		$	10.96		$	10.85		$	10.86		$	11.13		$	11.17
Income from investment operations:
Net investment income		0.25	(1)		0.52			0.52			0.50	(1)		0.45			0.45	(1)
Net realized and unrealized
gains (losses) on investments		0.26			(0.65	)		0.10			(0.03	)		(0.28	)		(0.05	)
Total from investment operations		0.51			(0.13	)		0.62			0.47			0.17			0.40
Less distributions:
Dividends from net investment income		(0.24	)		(0.51	)		(0.51	)		(0.48	)		(0.44	)		(0.44	)
Distributions from net realized gains		—			—			—			—			—			(0.00	)(2)
Total distributions		(0.24	)		(0.51	)		(0.51	)		(0.48	)		(0.44	)		(0.44	)
Net asset value, end of period	$	10.59		$	10.32		$	10.96		$	10.85		$	10.86		$	11.13
Total return		5.11	%(3)		(1.31	)%		5.89	%		4.47	%		1.56	%		3.65	%
Supplemental data and ratios:
Net assets, end of period	$	5,789,856		$	4,017,828		$	3,276,351		$	1,207,214		$	2,829,659		$	3,012,328
Ratio of expenses to average net assets		0.55	%(4)		0.55	%		0.55	%		0.55	%		0.55	%		0.55	%
Ratio of net investment income
to average net assets		4.92	%(4)		4.89	%		4.88	%		4.65	%		4.09	%		4.07	%
Portfolio turnover rate(5)		16.7	%(3)		32.9	%		42.5	%		44.8	%		42.1	%		44.8	%

(1) Calculated using average shares outstanding during the period.

(2) Amount is less than $0.01.

(3) Not annualized.

(4) Annualized.

(5) Portfolio turnover is calculated on the basis of the Fund as a whole without distinguishing between the classes of shares issued.

The accompanying notes are an integral part of these financial statements.

Page 99

Baird Funds, Inc.

Financial Highlights

	Baird Intermediate Municipal Bond Fund – Institutional Class
	Six Months
	Ended
	June 30, 2009			Year Ended December 31,
	(Unaudited)			2008			2007			2006			2005			2004
Per Share Data:
Net asset value, beginning of period	$	10.98		$	10.69		$	10.55		$	10.56		$	10.81		$	10.91
Income from investment operations:
Net investment income(1)		0.16			0.39			0.37			0.39			0.39			0.40
Net realized and unrealized
gains (losses) on investments		0.13			0.28			0.14			(0.01	)		(0.25	)		(0.11	)
Total from investment operations		0.29			0.67			0.51			0.38			0.14			0.29
Less distributions:
Dividends from net investment income		(0.15	)		(0.38	)		(0.37	)		(0.39	)		(0.39	)		(0.39	)
Net asset value, end of period	$	11.12		$	10.98		$	10.69		$	10.55		$	10.56		$	10.81
Total return		2.61	%(2)		6.37	%		4.93	%		3.69	%		1.33	%		2.69	%
Supplemental data and ratios:
Net assets, end of period	$	375,144,235		$	226,148,164		$	106,583,763		$	64,932,629		$	53,831,848		$	36,889,211
Ratio of expenses to average net assets		0.30	%(3)		0.30	%		0.30	%		0.30	%		0.30	%		0.30	%
Ratio of net investment income
to average net assets		2.92	%(3)		3.58	%		3.44	%		3.72	%		3.64	%		3.70	%
Portfolio turnover rate(4)		0.5	%(2)		0.9	%		5.6	%		25.1	%		13.7	%		4.2	%

(1) Calculated using average shares outstanding during the period.

(2) Not annualized.

(3) Annualized.

(4) Portfolio turnover is calculated on the basis of the Fund as a whole without distinguishing between the classes of shares issued.

The accompanying notes are an integral part of these financial statements.

Page 100

Baird Funds, Inc.

Financial Highlights

	Baird Intermediate Municipal Bond Fund – Investor Class
	Six Months
	Ended
	June 30, 2009			Year Ended December 31,
	(Unaudited)			2008			2007			2006			2005			2004
Per Share Data:
Net asset value, beginning of period	$	11.19		$	10.90		$	10.75		$	10.75		$	10.99		$	11.09
Income from investment operations:
Net investment income(1)		0.15			0.36			0.35			0.37			0.37			0.38
Net realized and unrealized
gains (losses) on investments		0.13			0.28			0.14			(0.01	)		(0.25	)		(0.12	)
Total from investment operations		0.28			0.64			0.49			0.36			0.12			0.26
Less distributions:
Dividends from net investment income		(0.14	)		(0.35	)		(0.34	)		(0.36	)		(0.36	)		(0.36	)
Net asset value, end of period	$	11.33		$	11.19		$	10.90		$	10.75		$	10.75		$	10.99
Total return		2.46	%(2)		6.02	%		4.68	%		3.44	%		1.13	%		2.40	%
Supplemental data and ratios:
Net assets, end of period	$	125,754,836		$	17,415,418		$	396,464		$	544,878		$	1,491,666		$	4,611,766
Ratio of expenses to average net assets		0.55	%(3)		0.55	%		0.55	%		0.55	%		0.55	%		0.55	%
Ratio of net investment income
to average net assets		2.67	%(3)		3.33	%		3.19	%		3.47	%		3.39	%		3.45	%
Portfolio turnover rate(4)		0.5	%(2)		0.9	%		5.6	%		25.1	%		13.7	%		4.2	%

(1) Calculated using average shares outstanding during the period.

(2) Not annualized.

(3) Annualized.

(4) Portfolio turnover is calculated on the basis of the Fund as a whole without distinguishing between the classes of shares issued.

The accompanying notes are an integral part of these financial statements.

Page 101

Baird Funds, Inc.

Financial Highlights

	Baird Aggregate Bond Fund – Institutional Class
	Six Months
	Ended
	June 30, 2009			Year Ended December 31,
	(Unaudited)			2008			2007			2006			2005			2004
Per Share Data:
Net asset value, beginning of period	$	9.74		$	10.54		$	10.51		$	10.54		$	10.74		$	10.71
Income from investment operations:
Net investment income		0.27	(1)		0.56			0.54			0.52			0.49	(1)		0.49	(1)
Net realized and unrealized
gains (losses) on investments		0.10			(0.81	)		0.03			(0.03	)		(0.19	)		0.07
Total from investment operations		0.37			(0.25	)		0.57			0.49			0.30			0.56
Less distributions:
Dividends from net investment income		(0.27	)		(0.55	)		(0.54	)		(0.52	)		(0.49	)		(0.50	)
Distributions from net realized gains		—			—			—			(0.00	)(2)		(0.01	)		(0.03	)
Total distributions		(0.27	)		(0.55	)		(0.54	)		(0.52	)		(0.50	)		(0.53	)
Net asset value, end of period	$	9.84		$	9.74		$	10.54		$	10.51		$	10.54		$	10.74
Total return		3.87	%(3)		(2.36	)%		5.61	%		4.88	%		2.85	%		5.30	%
Supplemental data and ratios:
Net assets, end of period	$	954,986,749		$	842,724,670		$	725,580,384		$	334,907,855		$	227,132,399		$	115,382,862
Ratio of expenses to average net assets		0.30	%(4)		0.30	%		0.30	%		0.30	%		0.30	%		0.30	%
Ratio of net investment income
to average net assets		5.76	%(4)		5.46	%		5.37	%		5.11	%		4.56	%		4.58	%
Portfolio turnover rate(5)		21.2	%(3)		21.9	%		33.6	%		52.4	%		46.0	%		72.6	%

(1) Calculated using average shares outstanding during the period.

(2) Amount is less than ($0.01).

(3) Not annualized.

(4) Annualized.

(5) Portfolio turnover is calculated on the basis of the Fund as a whole without distinguishing between the classes of shares issued.

The accompanying notes are an integral part of these financial statements.

Page 102

Baird Funds, Inc.

Financial Highlights

	Baird Aggregate Bond Fund – Investor Class
	Six Months
	Ended
	June 30, 2009			Year Ended December 31,
	(Unaudited)			2008			2007			2006			2005			2004
Per Share Data:
Net asset value, beginning of period	$	9.97		$	10.78		$	10.73		$	10.75		$	10.95		$	10.88
Income from investment operations:
Net investment income		0.27	(1)		0.52			0.53			0.50			0.47	(1)		0.48	(1)
Net realized and unrealized
gains (losses) on investments		0.09			(0.81	)		0.04			(0.02	)		(0.19	)		0.07
Total from investment operations		0.36			(0.29	)		0.57			0.48			0.28			0.55
Less distributions:
Dividends from net investment income		(0.26	)		(0.52	)		(0.52	)		(0.50	)		(0.47	)		(0.45	)
Distributions from net realized gains		—			—			—			(0.00	)(2)		(0.01	)		(0.03	)
Total distributions		(0.26	)		(0.52	)		(0.52	)		(0.50	)		(0.48	)		(0.48	)
Net asset value, end of period	$	10.07		$	9.97		$	10.78		$	10.73		$	10.75		$	10.95
Total return		3.65	%(3)		(2.63	)%		5.45	%		4.61	%		2.54	%		5.20	%
Supplemental data and ratios:
Net assets, end of period	$	31,331,299		$	29,146,211		$	14,363,416		$	1,848,622		$	1,289,926		$	708,858
Ratio of expenses to average net assets		0.55	%(4)		0.55	%		0.55	%		0.55	%		0.55	%		0.55	%
Ratio of net investment income
to average net assets		5.51	%(4)		5.21	%		5.12	%		4.86	%		4.31	%		4.33	%
Portfolio turnover rate(5)		21.2	%(3)		21.9	%		33.6	%		52.4	%		46.0	%		72.6	%

(1) Calculated using average shares outstanding during the period.

(2) Amount is less than ($0.01).

(3) Not annualized.

(4) Annualized.

(5) Portfolio turnover is calculated on the basis of the Fund as a whole without distinguishing between the classes of shares issued.

The accompanying notes are an integral part of these financial statements.

Page 103

Baird Funds, Inc.

Financial Highlights

	Baird Core Plus Bond Fund – Institutional Class
	Six Months
	Ended
	June 30, 2009			Year Ended December 31,
	(Unaudited)			2008			2007			2006			2005			2004
Per Share Data:
Net asset value, beginning of period	$	9.46		$	10.22		$	10.16		$	10.06		$	10.38		$	10.45
Income from investment operations:
Net investment income		0.32	(1)		0.56	(1)		0.54	(1)		0.55	(1)		0.51	(1)		0.54
Net realized and unrealized
gains (losses) on investments		0.21			(0.73	)		0.05			0.09			(0.28	)		0.10
Total from investment operations		0.53			(0.17	)		0.59			0.64			0.23			0.64
Less distributions:
Dividends from net investment income		(0.31	)		(0.55	)		(0.53	)		(0.54	)		(0.54	)		(0.53	)
Distributions from net realized gains		—			(0.04	)		—			—			(0.01	)		(0.18	)
Total distributions		(0.31	)		(0.59	)		(0.53	)		(0.54	)		(0.55	)		(0.71	)
Net asset value, end of period	$	9.68		$	9.46		$	10.22		$	10.16		$	10.06		$	10.38
Total return		5.85	%(2)		(1.79	)%		5.99	%		6.58	%		2.23	%		6.29	%
Supplemental data and ratios:
Net assets, end of period	$	176,839,118		$	158,983,325		$	114,421,895		$	51,551,017		$	32,173,459		$	32,495,641
Ratio of expenses to average net assets		0.30	%(3)		0.30	%		0.30	%		0.30	%		0.30	%		0.30	%
Ratio of net investment income
to average net assets		6.83	%(3)		5.61	%		5.41	%		5.49	%		4.92	%		4.85	%
Portfolio turnover rate(4)		22.9	%(2)		27.7	%		47.4	%		62.0	%		37.6	%		52.5	%

(1) Calculated using average shares outstanding during the period.

(2) Not annualized.

(3) Annualized.

(4) Portfolio turnover is calculated on the basis of the Fund as a whole without distinguishing between the classes of shares issued.

The accompanying notes are an integral part of these financial statements.

Page 104

Baird Funds, Inc.

Financial Highlights

	Baird Core Plus Bond Fund – Investor Class
	Six Months
	Ended
	June 30, 2009			Year Ended December 31,
	(Unaudited)			2008			2007			2006			2005			2004
Per Share Data:
Net asset value, beginning of period	$	9.72		$	10.50		$	10.42		$	10.30		$	10.62		$	10.67
Income from investment operations:
Net investment income		0.32	(1)		0.53	(1)		0.53	(1)		0.54	(1)		0.49	(1)		0.53
Net realized and unrealized
gains (losses) on investments		0.23			(0.74	)		0.06			0.09			(0.29	)		0.10
Total from investment operations		0.55			(0.21	)		0.59			0.63			0.20			0.63
Less distributions:
Dividends from net investment income		(0.30	)		(0.53	)		(0.51	)		(0.51	)		(0.51	)		(0.50	)
Distributions from net realized gains		—			(0.04	)		—			—			(0.01	)		(0.18	)
Total distributions		(0.30	)		(0.57	)		(0.51	)		(0.51	)		(0.52	)		(0.68	)
Net asset value, end of period	$	9.97		$	9.72		$	10.50		$	10.42		$	10.30		$	10.62
Total return		5.77	%(2)		(2.07	)%		5.80	%		6.34	%		1.93	%		6.09	%
Supplemental data and ratios:
Net assets, end of period	$	37,230,652		$	29,583,588		$	2,473,660		$	288,928		$	449,709		$	125,847
Ratio of expenses to average net assets		0.55	%(3)		0.55	%		0.55	%		0.55	%		0.55	%		0.55	%
Ratio of net investment income
to average net assets		6.58	%(3)		5.36	%		5.16	%		5.24	%		4.67	%		4.60	%
Portfolio turnover rate(4)		22.9	%(2)		27.7	%		47.4	%		62.0	%		37.6	%		52.5	%

(1) Calculated using average shares outstanding during the period.

(2) Not annualized.

(3) Annualized.

(4) Portfolio turnover is calculated on the basis of the Fund as a whole without distinguishing between the classes of shares issued.

The accompanying notes are an integral part of these financial statements.

Page 105

Baird Funds, Inc.

Notes to the Financial Statements       June 30, 2009 (Unaudited)

1. ORGANIZATION

Baird Funds, Inc. (the “Corporation”) was incorporated on June 9, 2000 as a Wisconsin corporation and is registered as an open-end investment management company under the Investment Company Act of 1940, as amended (the “1940 Act”).  The accompanying financial statements include the Baird Short-Term Bond Fund, Baird Intermediate Bond Fund, Baird Intermediate Municipal Bond Fund, Baird Aggregate Bond Fund and Baird Core Plus Bond Fund (each, a “Fund” and collectively, the “Funds”), five of the eight portfolios comprising the Corporation, each of which is diversified within the meaning of the 1940 Act.  Robert W. Baird & Co. Incorporated (“Baird” or the “Advisor”) serves as investment advisor to the Funds.

The Baird Short-Term Bond Fund commenced operations with the sale of Institutional Class Shares on August 31, 2004.  The Baird Intermediate Municipal Bond Fund commenced operations with the sale of both Institutional and Investor class shares on March 30, 2001.  The Baird Intermediate Bond Fund, Baird Aggregate Bond Fund and Baird Core Plus Bond Fund commenced operations with the sale of both Institutional and Investor class shares on September 29, 2000.  The Institutional Class Shares are not subject to a distribution and service (12b-1) fee, while the Investor Class Shares are subject to a distribution and service (12b-1) fee up to 0.25%.

The investment objective of the Baird Short-Term Bond Fund is to provide an annual rate of total return, before Fund expenses, greater than the annual rate of total return of the Barclays Capital 1-3 Year U.S. Government/Credit Bond Index.  The Barclays Capital 1-3 Year U.S. Government/Credit Bond Index is an unmanaged, market value weighted index of investment grade, fixed-rate debt including government and corporate securities with maturities between one and three years.

The investment objective of the Baird Intermediate Bond Fund is to provide an annual rate of total return, before Fund expenses, greater than the annual rate of total return of the Barclays Capital Intermediate U.S. Government/Credit Bond Index.  The Barclays Capital Intermediate U.S. Government/Credit Bond Index is an unmanaged, market value weighted index of investment grade, fixed-rate debt, including government and corporate securities, with maturities between one and ten years.

The primary investment objective of the Baird Intermediate Municipal Bond Fund is to provide current income that is substantially exempt from federal income tax.  A secondary objective is to provide total return with relatively low volatility of principal.

The investment objective of the Baird Aggregate Bond Fund is to provide an annual rate of total return, before Fund expenses, greater than the annual rate of total return of the Barclays Capital U.S. Aggregate Bond Index.  The Barclays Capital U.S. Aggregate Bond Index is an unmanaged, market value weighted index of investment grade, fixed-rate debt issues, including government, corporate, asset-backed, and mortgage-backed securities, with maturities of at least one year.

The investment objective of the Baird Core Plus Bond Fund is to provide an annual rate of total return, before Fund expenses, greater than the annual rate of total return of the Barclays Capital U.S. Universal Bond Index. The Barclays Capital U.S. Universal Bond Index is an unmanaged, market value weighted index of fixed income securities issued in U.S. dollars, including U.S. government and investment grade debt, non-investment grade debt, asset-backed and mortgage-backed securities, Eurobonds, 144A securities and emerging market debt, with maturities of at least one year.

Page 106

Baird Funds, Inc.

Notes to the Financial Statements       June 30, 2009 (Unaudited)

2. SIGNIFICANT ACCOUNTING POLICIES

The following is a summary of significant accounting policies consistently followed by the Funds in the preparation of their financial statements.  These policies are in conformity with accounting principles generally accepted in the United States of America.

a) Investment Valuation – Section 2(a)(41) of the 1940 Act, together with the rules and interpretations of the SEC, require the Funds, in computing NAV, to value their portfolio securities using market quotations when they are “readily available.”  When market quotations are not readily available (e.g., because there is no regular market quotation for such securities, the market for such security is limited, the validity of quotations is questionable or, for debt securities, IDC does not provide a price), the Board of Directors of the Corporation must value the securities at “fair value determined in good faith.”  The Board has delegated such responsibility to the Advisor pursuant to pricing policies and procedures that the Board has adopted and regularly reviews.

In general, the “fair value” of a security means the amount that the Funds might reasonably expect to receive for the security upon its current sale.  Pursuant to Statement of Financial Accounting Standards No. 157 (“SFAS 157), “fair value” means “the price that would be received to sell [a security] in an orderly transaction between market participants at the measurement date.”

Consistent with Section 2(a)(41) of the 1940 Act and SFAS 157, the Funds price their securities as follows:  Debt securities are valued by an independent pricing service using valuation methods that are designed to represent fair value, such as matrix pricing and other analytical pricing models, market transactions and dealer quotations.  Debt securities purchased with a remaining maturity of 60 days or less are valued at acquisition cost, plus or minus any amortized discount or premium.  Investments in mutual funds are valued at their stated net asset value.  Common stocks that are listed on a securities exchange (other than NASDAQ) are valued at the last quoted sales price.  Securities traded on NASDAQ are valued at the NASDAQ Official Closing Price.  Price information on listed stocks is taken from the exchange where the security is primarily traded.  Securities that were not traded on the valuation date, as well as stocks that are not listed on an exchange, including NASDAQ, are valued at the average of the current bid and asked price.  Other assets and securities for which no quotations are readily available are valued at fair value as determined in good faith by the Advisor in accordance with procedures approved by the Corporation’s Board of Directors.  In accordance with such procedures, the Advisor may use broker quotes or, if the broker quotes are unavailable or deemed to be unreliable, fair value will be determined by a valuation committee of the Advisor.  In determining fair value, the valuation committee takes into account all relevant factors and available information.  Consequently, the price of the security used by a Fund to calculate its NAV may differ from quoted or published prices for the same security.  Fair value pricing involves subjective judgments and there is no single standard for determining a security’s fair value.  As a result, different mutual funds could reasonably arrive at a different fair value for the same security.  It is possible that the fair value determined for a security is materially different from the value that could be realized upon the sale of that security or from the values that other mutual funds may determine.  In addition, given the volatility and periodic illiquidity experienced in current markets, the prices determined for any individual security on any given day may vary significantly from the amount that can be obtained in an actual sale of that security, and the Funds’ NAVs may fluctuate significantly from day to day or from period to period.

Page 107

Baird Funds, Inc.

Notes to the Financial Statements       June 30, 2009 (Unaudited)

2. SIGNIFICANT ACCOUNTING POLICIES (cont.)

In September 2006, the Financial Accounting Standards Board (FASB) issued SFAS 157, “Fair Value Measurements.”  SFAS 157 defines fair value, establishes a framework for measuring fair value in accordance with GAAP, and expands disclosure about fair value measurements. SFAS 157 is effective for financial statements issued for fiscal years beginning after November 15, 2007.  Management has determined that SFAS 157 had no material impact on the Funds’ financial statements.

In March 2008, Statement of Financial Accounting Standards No. 161, “Disclosures about Derivative Instruments and Hedging Activities” (“SFAS 161”) was issued and is effective for fiscal years beginning after November 15, 2008.  SFAS 161 is intended to improve financial reporting for derivative instruments by requiring enhanced disclosure that enables investors to understand how and why an entity uses derivatives, how derivatives are accounted for, and how derivative instruments affect an entity’s results of operations and financial position.  Management has determined that SFAS 161 does not have any impact on the Funds’ financial statement disclosures because the Funds have not maintained any positions in derivative instruments or engaged in hedging activities.

In preparing these financial statements, the Funds have evaluated events and transactions for potential recognition or disclosure through August 28, 2009, the date the financial statements were available to be issued.

b) Unregistered Securities – Four of the Funds own certain investment securities which are unregistered and thus restricted with respect to resale.  These securities are valued by the Advisor after giving due consideration to pertinent factors including recent private sales, market conditions and the issuer’s financial performance.  The value of such securities for the Baird Short-Term Bond, Baird Intermediate Bond, Baird Aggregate Bond and Baird Core Plus Bond Funds were $37,471,979 (9.98% of net assets), $21,293,301 (4.59% of net assets), $56,125,353 (5.69% of net assets) and $7,244,824 (3.38% of net assets), respectively, at June 30, 2009. Restricted securities may be deemed to be liquid as determined by the Advisor based on several factors.  All of the restricted securities held by the Funds as of June 30, 2009 consist of securities issued pursuant to Rule 144A under the Securities Act of 1933 and a majority have been deemed to be liquid.  A restricted security that is held in each of the Baird Aggregate Bond and Baird Core Plus Bond Funds has been deemed illiquid.  The value of the illiquid security is $1,300,000 (0.1% of net assets) in the Baird Aggregate Bond Fund and $200,000 (0.1% of net assets) in the Baird Core Plus Bond Fund.

c) Foreign Securities – Foreign securities are defined as securities of issuers that are organized outside the United States. The Funds may invest in U.S. dollar-denominated debt obligations of foreign companies and foreign governments. Investing in securities of foreign companies and foreign governments involves special risks and considerations not typically associated with investing in U.S. companies and the U.S. government.  These risks include currency rate fluctuations, political and economic instability and differences in financial reporting standards and less strict regulation of securities markets.  Moreover, securities of many foreign companies and foreign governments and their markets may be less liquid and their prices more volatile than those of securities of comparable U.S. companies and the U.S. government. Occasionally, events that affect these values and exchange rates may occur after the close of the exchange on which such securities are traded.  If such events materially affect the value of a Funds’ securities, these securities may be valued at their fair value pursuant to procedures adopted by the Board of Directors.

Page 108

Baird Funds, Inc.

Notes to the Financial Statements       June 30, 2009 (Unaudited)

2. SIGNIFICANT ACCOUNTING POLICIES (cont.)

d) Federal Income Taxes – The Funds intend to continue to qualify as regulated investment companies as provided in subchapter M of the Internal Revenue Code and to distribute substantially all of their taxable income to their shareholders in a manner which results in no tax cost to the Funds.  Therefore, no federal income or excise tax provision is recorded.

Effective June 29, 2007, the Funds adopted Financial Accounting Standards Board (FASB) Interpretation No. 48 (FIN 48), “Accounting for Uncertainty in Income Taxes,” a clarification of FASB Statement No. 109, “Accounting for Income Taxes.” FIN 48 establishes financial reporting rules regarding recognition and measurement of tax positions taken or expected to be taken on a tax return.  Management has determined that FIN 48 did not result in any liability to the Funds.

e) Allocation of Income and Expenses – Each Fund is charged for those expenses directly attributable to it.  Expenses directly attributable to a class of shares, such as Rule 12b-1 distribution fees, are charged to that class of shares.  Income, expenses and realized and unrealized gains and losses are allocated to the classes based on their respective net assets.  Expenses that are not directly attributable to a Fund are allocated among the Funds in the series in proportion to their assets.

f) Distributions to Shareholders – Dividends from net investment income are declared and paid monthly.  Distributions of net realized capital gains, if any, are declared and paid at least annually.

g) Use of Estimates – The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period.  Actual results could differ from those estimates.

h) Other – Investment and shareholder transactions are recorded on trade date.  The Funds determine the gain or loss realized from investment transactions by comparing the original cost of the security lot sold with the net sales proceeds.  Dividend income is recognized on the ex-dividend date and interest income is recognized on an accrual basis.  Premiums  and discounts on the purchase of securities are amortized/accreted using the effective interest method.  Accounting principles generally accepted in the United States of America require that permanent financial reporting and tax differences be reclassified in the capital accounts.

i) Guarantees and Indemnifications – In the normal course of business, the Funds enter into contracts with service providers that contain general indemnification clauses.  The Funds’ maximum exposure under these arrangements is unknown and would involve future claims against the Funds that have not yet occurred.  Based on experience, the Funds would expect the risk of loss to be remote.

Page 109

Baird Funds, Inc.

Notes to the Financial Statements       June 30, 2009 (Unaudited)

3. CAPITAL SHARE TRANSACTIONS

The following table summarizes the capital share transactions of each Fund for the past two fiscal periods:

BAIRD SHORT-TERM BOND FUND

	Six Months Ended							Year Ended
	June 30, 2009							December 31, 2008
Institutional Class Shares	Shares			Amount			Institutional Class Shares	Shares			Amount
Shares sold		24,048,225		$	222,821,579		Shares sold		18,494,988		$	178,053,687
Shares issued to							Shares issued to
shareholders in							shareholders in
reinvestment of dividends		713,433			6,612,017		reinvestment of dividends		1,090,024			10,505,667
Shares redeemed		(7,915,314	)		(73,582,535	)	Shares redeemed		(16,418,698	)		(158,184,075	)
Net increase		16,846,344		$	155,851,061		Net increase		3,166,314		$	30,375,279
Shares Outstanding:							Shares Outstanding:
Beginning of period		23,247,321					Beginning of period		20,081,007
End of period		40,093,665					End of period		23,247,321

BAIRD INTERMEDIATE BOND FUND

	Six Months Ended							Six Months Ended
	June 30, 2009							June 30, 2009
Institutional Class Shares	Shares			Amount			Investor Class Shares	Shares			Amount
Shares sold		8,260,122		$	83,397,897		Shares sold		225,686		$	2,354,270
Shares issued to							Shares issued to
shareholders in							shareholders in
reinvestment of dividends		879,367			8,836,031		reinvestment of dividends		9,794			101,738
Shares redeemed		(4,661,533	)		(46,846,104	)	Shares redeemed		(78,278	)		(819,993	)
Net increase		4,477,956		$	45,387,824		Net increase		157,202		$	1,636,015
Shares Outstanding:							Shares Outstanding:
Beginning of period		40,203,656					Beginning of period		389,348
End of period		44,681,612					End of period		546,550

Page 110

Baird Funds, Inc.

Notes to the Financial Statements       June 30, 2009 (Unaudited)

3. CAPITAL SHARE TRANSACTIONS (cont.)

BAIRD INTERMEDIATE BOND FUND (cont.)

	Year Ended							Year Ended
	December 31, 2008							December 31, 2008
Institutional Class Shares	Shares			Amount			Investor Class Shares	Shares			Amount
Shares sold		13,284,667		$	139,033,374		Shares sold		344,090		$	3,606,725
Shares issued to							Shares issued to
shareholders in							shareholders in
reinvestment of dividends		1,893,754			19,500,448		reinvestment of dividends		11,882			124,883
Shares redeemed		(12,483,629	)		(127,498,417	)	Shares redeemed		(265,688	)		(2,772,608	)
Net increase		2,694,792		$	31,035,405		Net increase		90,284		$	959,000
Shares Outstanding:							Shares Outstanding:
Beginning of period		37,508,864					Beginning of period		299,064
End of period		40,203,656					End of period		389,348

BAIRD INTERMEDIATE MUNICIPAL BOND FUND

	Six Months Ended							Six Months Ended
	June 30, 2009							June 30, 2009
Institutional Class Shares	Shares			Amount			Investor Class Shares	Shares			Amount
Shares sold		18,465,611		$	206,256,585		Shares sold		11,132,358		$	127,031,122
Shares issued to							Shares issued to
shareholders in							shareholders in
reinvestment of dividends		314,796			3,520,058		reinvestment of dividends		87,402			996,056
Shares redeemed		(5,630,462	)		(63,127,847	)	Shares redeemed		(1,676,020	)		(19,008,401	)
Net increase		13,149,945		$	146,648,796		Net increase		9,543,740		$	109,018,777
Shares Outstanding:							Shares Outstanding:
Beginning of period		20,594,998					Beginning of period		1,556,188
End of period		33,744,943					End of period		11,099,928

Page 111

Baird Funds, Inc.

Notes to the Financial Statements       June 30, 2009 (Unaudited)

3. CAPITAL SHARE TRANSACTIONS (cont.)

BAIRD INTERMEDIATE MUNICIPAL BOND FUND (cont.)

	Year Ended							Year Ended
	December 31, 2008							December 31, 2008
Institutional Class Shares	Shares			Amount			Investor Class Shares	Shares			Amount
Shares sold		13,276,639		$	142,984,847		Shares sold		1,565,048		$	17,234,317
Shares issued to							Shares issued to
shareholders in							shareholders in
reinvestment of dividends		411,841			4,420,800		reinvestment of dividends		8,443			92,642
Shares redeemed		(3,060,912	)		(32,903,382	)	Shares redeemed		(53,682	)		(586,727	)
Net increase		10,627,568		$	114,502,265		Net increase		1,519,809		$	16,740,232
Shares Outstanding:							Shares Outstanding:
Beginning of period		9,967,430					Beginning of period		36,379
End of period		20,594,998					End of period		1,556,188

BAIRD AGGREGATE BOND FUND

	Six Months Ended							Six Months Ended
	June 30, 2009							June 30, 2009
Institutional Class Shares	Shares			Amount			Investor Class Shares	Shares			Amount
Shares sold		22,630,676		$	218,672,298		Shares sold		753,459		$	7,450,619
Shares issued to							Shares issued to
shareholders in							shareholders in
reinvestment of dividends		2,063,193			19,745,246		reinvestment of dividends		80,159			790,298
Shares redeemed		(14,106,448	)		(135,959,884	)	Shares redeemed		(646,218	)		(6,370,350	)
Net increase		10,587,421		$	102,457,660		Net increase		187,400		$	1,870,567
Shares Outstanding:							Shares Outstanding:
Beginning of period		86,482,977					Beginning of period		2,922,530
End of period		97,070,398					End of period		3,109,930

Page 112

Baird Funds, Inc.

Notes to the Financial Statements       June 30, 2009 (Unaudited)

3. CAPITAL SHARE TRANSACTIONS (cont.)

BAIRD AGGREGATE BOND FUND (cont.)

	Year Ended							Year Ended
	December 31, 2008							December 31, 2008
Institutional Class Shares	Shares			Amount			Investor Class Shares	Shares			Amount
Shares sold		35,060,168		$	355,079,855		Shares sold		2,373,145		$	25,042,735
Shares issued to							Shares issued to
shareholders in							shareholders in
reinvestment of dividends		3,467,389			34,858,275		reinvestment of dividends		124,786			1,278,910
Shares redeemed		(20,869,352	)		(208,295,492	)	Shares redeemed		(908,136	)		(9,298,862	)
Net increase		17,658,205		$	181,642,638		Net increase		1,589,795		$	17,022,783
Shares Outstanding:							Shares Outstanding:
Beginning of period		68,824,772					Beginning of period		1,332,735
End of period		86,482,977					End of period		2,922,530

BAIRD CORE PLUS BOND FUND

	Six Months Ended							Six Months Ended
	June 30, 2009							June 30, 2009
Institutional Class Shares	Shares			Amount			Investor Class Shares	Shares			Amount
Shares sold		4,972,287		$	46,848,738		Shares sold		1,330,711		$	12,883,245
Shares issued to							Shares issued to
shareholders in							shareholders in
reinvestment of dividends		528,552			4,986,324		reinvestment of dividends		97,416			944,546
Shares redeemed		(4,051,744	)		(38,548,901	)	Shares redeemed		(734,951	)		(7,123,825	)
Net increase		1,449,095		$	13,286,161		Net increase		693,176		$	6,703,966
Shares Outstanding:							Shares Outstanding:
Beginning of period		16,814,148					Beginning of period		3,042,325
End of period		18,263,243					End of period		3,735,501

Page 113

Baird Funds, Inc.

Notes to the Financial Statements       June 30, 2009 (Unaudited)

3. CAPITAL SHARE TRANSACTIONS (cont.)

BAIRD CORE PLUS BOND FUND (cont.)

	Year Ended							Year Ended
	December 31, 2008							December 31, 2008
Institutional Class Shares	Shares			Amount			Investor Class Shares	Shares			Amount
Shares sold		9,503,375		$	94,092,004		Shares sold		3,970,650		$	40,793,424
Shares issued to							Shares issued to
shareholders in							shareholders in
reinvestment of dividends		808,307			7,891,717		reinvestment of dividends		41,410			416,265
Shares redeemed		(4,691,588	)		(45,526,757	)	Shares redeemed		(1,205,342	)		(12,087,198	)
Net increase		5,620,094		$	56,456,964		Net increase		2,806,718		$	29,122,491
Shares Outstanding:							Shares Outstanding:
Beginning of period		11,194,054					Beginning of period		235,607
End of period		16,814,148					End of period		3,042,325

4. INVESTMENT TRANSACTIONS AND INCOME TAX INFORMATION

During the six months ended June 30, 2009, purchases and sales of investment securities (excluding short-term investments) were as follows:

					Baird
	Baird		Baird		Intermediate		Baird		Baird
	Short-Term		Intermediate		Municipal		Aggregate		Core Plus
	Bond Fund		Bond Fund		Bond Fund		Bond Fund		Bond Fund
Purchases:
U.S. Government	$	106,241,428	$	70,763,567	$	—	$	178,338,912	$	22,985,012
Other	$	128,535,807	$	35,817,197	$	256,451,698	$	114,687,944	$	25,213,269
Sales:
U.S. Government	$	32,268,660	$	37,461,301	$	—	$	108,379,123	$	31,296,182
Other	$	59,749,778	$	32,037,508	$	1,567,000	$	72,973,628	$	14,392,584

Page 114

Baird Funds, Inc.

Notes to the Financial Statements       June 30, 2009 (Unaudited)

4. INVESTMENT TRANSACTIONS AND INCOME TAX INFORMATION (cont.)

At December 31, 2008, gross unrealized appreciation and depreciation of investments and distributable ordinary income and long-term capital gains for federal tax purposes were as follows:

							Baird
	Baird			Baird			Intermediate			Baird			Baird
	Short-Term			Intermediate			Municipal			Aggregate			Core Plus
	Bond Fund			Bond Fund			Bond Fund			Bond Fund			Bond Fund
Cost of Investments	$	244,300,776		$	575,074,182		$	229,549,081		$	1,140,078,561		$	245,167,858
Gross unrealized appreciation	$	1,463,970		$	12,832,844		$	7,639,290		$	29,227,106		$	5,965,601
Gross unrealized depreciation		(14,923,827	)		(42,009,321	)		(262,799	)		(94,778,688	)		(19,749,447	)
Net unrealized
appreciation/(depreciation)	$	(13,459,857	)	$	(29,176,477	)	$	7,376,491		$	(65,551,582	)	$	(13,783,846	)
Undistributed ordinary income*	$	68,686		$	403,041		$	—		$	838,376		$	279,375
Undistributed long-term capital gain		—			942,602			—			—			274,239
Total distributable earnings	$	68,686		$	1,345,643		$	—		$	838,376		$	553,614
Other accumulated losses	$	(16,864	)	$	—		$	(610,565	)	$	—		$	—
Total accumulated earnings (losses)	$	(13,408,035	)	$	(27,830,834	)	$	6,765,926		$	(64,713,206	)	$	(13,230,232	)

* Undistributed ordinary income includes income from securities lending placed in reserve (see Note 6).

On the Statements of Assets and Liabilities, the following adjustments were made for permanent tax adjustments:

	Undistributed Net			Accumulated Net			Paid In
	Investment Income (Loss)			Realized Gain (Loss)			Capital
Baird Short-Term Bond Fund	$	(58,525	)	$	58,525		$	—
Baird Intermediate Bond Fund		7,685			(7,684	)		(1	)
Baird Intermediate Municipal Bond Fund		15,555			—			(15,555	)
Baird Aggregate Bond Fund		(6,840	)		6,840			—
Baird Core Plus Bond Fund		(32,675	)		32,674			1

The permanent differences primarily relate to reclasses from paydown gains and losses from asset backed securities.

Page 115

Baird Funds, Inc.

Notes to the Financial Statements       June 30, 2009 (Unaudited)

4. INVESTMENT TRANSACTIONS AND INCOME TAX INFORMATION (cont.)

The tax components of dividends paid during the periods shown below were as follows:

	Six Months Ended				Year Ended
	June 30, 2009				December 31, 2008
	Ordinary		Long-Term		Ordinary		Long-Term
	Income		Capital Gains		Income		Capital Gains
	Distributions		Distributions		Distributions		Distributions
Baird Short-Term Bond Fund	$	7,319,793	$	—	$	11,301,816	$	—
Baird Intermediate Bond Fund	$	10,675,324	$	—	$	22,529,659	$	26,827
Baird Intermediate Municipal Bond Fund	$	—	$	—	$	—	$	—
Baird Aggregate Bond Fund	$	25,005,762	$	—	$	45,140,110	$	—
Baird Core Plus Bond Fund	$	6,687,725	$	—	$	9,954,603	$	59,042

For the six month period ended June 30, 2009 and the year ended December 31, 2008, distributions of $5,167,408 and $5,189,460 ($15,555 of which was return of capital), respectively, from the Baird Intermediate Municipal Bond Fund were tax-exempt.

Under the current tax law, capital losses realized after October 31 may be deferred and treated as occurring on the first day of the following fiscal year.  For the year ended December 31, 2008, Baird Intermediate Municipal Bond Fund elected to defer capital losses occurring between November 1, 2008 and December 31, 2008 in the amount of $869.

At December 31, 2008, accumulated net realized capital loss carryovers, if any, and the year(s) in which the capital loss carryovers expire were:

	Capital Loss Carryover		Year of Expiration
Baird Short-Term Bond Fund		$16,864	2014
Baird Intermediate Municipal Bond Fund		6,626	2012
		184,660	2013
		51,283	2014
		76,723	2015
		290,404	2016

To the extent these Funds realize future net capital gains, those gains will be offset by any unused capital loss carryovers.  During the year ended December 31, 2008, the Baird Short-Term Bond Fund, the Baird Intermediate Bond Fund and the Baird Aggregate Bond Fund utilized capital loss carryovers of $281,458, $2,424,499, and $661,654, respectively.

5. INVESTMENT ADVISORY AND OTHER AGREEMENTS

The Funds have entered into an Investment Advisory Agreement with Baird for the provision of investment advisory services. Pursuant to the Investment Advisory Agreement, the Advisor is entitled to receive a fee, calculated daily and payable monthly, at the annual rate of 0.25% for the Funds as applied to the respective Fund’s average daily net assets.  Certain officers of the Advisor are also officers of the Funds.

Page 116

Baird Funds, Inc.

Notes to the Financial Statements       June 30, 2009 (Unaudited)

5. INVESTMENT ADVISORY AND OTHER AGREEMENTS (cont.)

The Funds have entered into an Administration Agreement with Baird.  Under the Administration Agreement, the Advisor assumes and pays all expenses of the applicable Fund other than the investment advisory fees, fees under the 12b-1 plan, costs related to portfolio securities transactions and extraordinary or non-recurring expenses.  Pursuant to the Administration Agreement, the Advisor is entitled to receive a fee, calculated daily and payable monthly, at the annual rate of 0.05% for the Funds as applied to the respective Fund’s average daily net assets.

U.S. Bancorp Fund Services, LLC serves as transfer agent, administrator, and accounting services agent for the Funds.  U.S. Bank, N.A. serves as custodian for the Funds.

Baird (the “Distributor”) is the distributor of the Funds pursuant to a distribution agreement.

6. SECURITIES LENDING

Each Fund may lend up to one-third of its total assets (including such loans) to borrowers under terms of participation in a securities lending program administered by FAF Advisors, Inc., an affiliate of the Funds’ custodian, transfer agent and administrator.  The securities lending agreement requires that loans are collateralized at all times in an amount equal to at least 102% of the market value of any loaned securities at the time of the loan, plus accrued interest.

The Funds receive compensation in the form of fees and earn interest on the cash collateral.  The amount of fees depends on a number of factors including the type of security and length of the loan.  Each Fund continues to receive interest payments or dividends on the securities loaned during the borrowing period.  Each Fund has the right under the terms of the securities lending agreement to recall the securities from the borrower on demand.

As of June 30, 2009, the Baird Short-Term Bond Fund, Baird Intermediate Bond Fund, Baird Aggregate Bond Fund and Baird Core Plus Bond Fund had loaned securities that were collateralized by cash equivalents.  The cash collateral is invested by the custodian in accordance with approved investment guidelines.  Those guidelines require the cash collateral to be invested in readily marketable, high quality, short-term obligations; however, such investments are subject to risk of payment delays or default on the part of the issuer or counterparty or otherwise may not generate sufficient interest to support the costs associated with securities lending.  A Fund could also experience delays in recovering its securities and possible loss of income or value if the borrower fails to return the borrowed securities, although the Funds are indemnified from this risk by contract with the securities lending agent.

As of June 30, 2009, the market value of the securities on loan and payable on collateral due to broker were as follows:

	Market Value of		Payable on Collateral
	Securities on Loan		due to Broker
Baird Short-Term Bond Fund	$	95,695,823	$	97,121,530
Baird Intermediate Bond Fund		180,745,590		185,115,199
Baird Aggregate Bond Fund		262,296,252		268,529,246
Baird Core Plus Bond Fund		45,847,828		46,573,586

Page 117

Baird Funds, Inc.

Notes to the Financial Statements       June 30, 2009 (Unaudited)

6. SECURITIES LENDING (cont.)

The Funds receive cash as collateral in return for securities lent as part of a securities lending program.  The collateral is invested in short-term securities including the Mount Vernon Prime Portfolio (a securities lending trust subject to Rule 2a-7 under the 1940 Act), other money market funds, certificates of deposit, commercial paper, corporate notes, government agency securities and repurchase agreements.  The schedules of investments for the Funds include the particular cash collateral holdings as of June 30, 2009.  The Funds intend to invest all of the collateral in the Mount Vernon Prime Portfolio once their existing cash collateral holdings mature or are liquidated or otherwise paid down.  Currently, the Funds hold two cash collateral investments that are priced at fair value by the Valuation Committee of the Advisor: an interest in Atlantic East Funding Trust, LLC and shares of the Reserve Primary Fund.  The interest in Atlantic East Funding Trust, LLC is priced at par based on the underlying market value of the securities owned by the Atlantic East Funding Trust, LLC, amounts payable under an agreement from the Funds’ transfer agent and administrator to cover losses realized by the Funds on this investment (up to a certain amount), and a securities lending income reserve.  This price for the Funds' interest in Atlantic East Funding Trust, LLC is reflected in the Funds' Schedules of Investments and is included in the Funds' investments, at value in the Funds' Statements of Assets and Liabilities.  The Funds deposited their securities lending income into a reserve account from July 2008 through January 2009, which reserve may be used to cover additional losses by the Funds on their interest in Atlantic East Funding Trust, LLC after applying amounts payable from the Funds’ transfer agent and administrator.  As a result of these securities lending income reserves, the Funds did not recognize income from their securities lending activity from July 2008 through January 2009 for financial reporting purposes but are required to recognize and distribute such income for tax purposes.  The amounts in the securities lending income reserve at June 30, 2009 are $52,186 for the Baird Short-Term Bond Fund, $508,832 for the Baird Intermediate Bond Fund, $981,849 for the Baird Aggregate Bond Fund, and $174,325 for the Baird Core Plus Bond Fund.  These amounts are not included as income from securities lending or as investment income on the Funds' Statements of Operations.  Upon the liquidation of the Funds’ interest in Atlantic East Funding Trust, LLC, any excess securities lending income reserves (after applying the reserves and amounts payable from the Funds’ transfer agent and administrator to cover losses) will then be recognized as income to the Funds.  The Funds discontinued depositing their securities lending income into a reserve in February 2009.  From February 2009 through June 2009, the Funds recognized income from their securities lending activity.  Interest income earned on collateral investments and recognized by the Funds during the six months ended June 30, 2009 for the Baird Short-Term Bond Fund, Baird Intermediate Bond Fund, Baird Aggregate Bond Fund, and Baird Core Plus Bond Fund were $72,125, $206,225, $281,261, and $59,134, respectively.  Shares of the Reserve Primary Fund are priced at $1.00 per share based on the fair value of the shares of that fund plus an agreement to contribute additional amounts to be applied to those shares by the Funds’ transfer agent and administrator.  This price for the Reserve Primary Fund shares is reflected in the Funds' Schedules of Investments and is included in the Funds' investments, at value in the Funds' Statements of Assets and Liabilities.

7. LINE OF CREDIT

The Corporation maintains an uncommitted, senior secured line of credit (“LOC”) with U.S. Bank, N.A. (the “Bank”) to provide the Funds a temporary liquidity source to meet unanticipated redemptions.  Under the terms of the LOC, borrowings for each Fund are limited to one-third of the total assets (including the amount borrowed) of the respective Fund, or as otherwise indicated within the Funds’ agreement with the Bank.  The Bank charges interest at the Bank’s Prime Rate less 1% (weighted average rate of 2.25% for the six months of 2009).  For the six months ended June 30, 2009, none of the Funds incurred interest charges on the LOC.

Page 118

Baird Funds, Inc.

Notes to the Financial Statements       June 30, 2009 (Unaudited)

8. DISTRIBUTION AND SHAREHOLDER SERVICE PLAN

The Funds have adopted a distribution and shareholder service plan (the “Plan”) pursuant to Rule 12b-1 under the 1940 Act.  The Plan allows the Funds to compensate the Distributor for the costs incurred in distributing the Funds’ Investor Class Shares, including amounts paid to brokers or dealers, at an annual rate not to exceed 0.25% of the average daily net assets of the Funds’ Investor Class Shares.  The Baird Intermediate Bond, Baird Intermediate Municipal Bond, Baird Aggregate Bond and Baird Core Plus Bond Funds incurred $5,903, $97,287, $38,105 and $43,058, respectively, in fees pursuant to the Plan during the six months ended June 30, 2009.

9. SUBSEQUENT EVENT

In July 2009, FAF Advisors, Inc. and its affiliate, the Bank, returned to the Funds fees and income they earned in respect of the Funds’ securities lending and borrowing activity from December 3, 2008 through May 21, 2009 because during that period the Bank may have been deemed to be indirectly affiliated with the Funds.  Amounts returned to the Funds are approximately $34,822 for the Baird Short-Term Bond Fund, $166,655 for the Baird Intermediate Bond Fund, $253,079 for the Baird Aggregate Bond Fund, and $52,281 for the Baird Core Plus Bond Fund.  The Funds are recognizing as income the securities lending fees returned to the Funds.  Interest income returned to the Funds related to their borrowings was recorded as a reduction of the Funds’ current year interest expense, with any excess relating to the prior year recorded to other income.  The additional income being recognized by the Funds will be included in the Funds’ regular income distributions.

Page 119

Additional Information

Proxy Voting

A description of the policies and procedures that the Funds use to determine how to vote proxies relating to portfolio securities is available without charge, upon request, by calling toll free, 1-866-44BAIRD, or by accessing the Funds’ website at www.bairdfunds.com; and by accessing the SEC’s website at www.sec.gov.

Each Fund’s proxy voting record for the most recent 12-month period ended June 30, if applicable, is available without charge, upon request, by calling toll free, 1-866-44BAIRD, or by accessing the Funds’ website at www.bairdfunds.com; and by accessing the SEC’s website at www.sec.gov.  The Funds generally do not vote proxies because the securities held in their portfolios, consisting of bonds and other fixed-income securities, are not entitled to vote.

Portfolio Holdings Disclosure

The Funds file a complete schedule of portfolio holdings with the SEC for the first and third quarters of each fiscal year on Form N-Q.  The Funds’ Forms N-Q are available on the SEC website at www.sec.gov and may be reviewed and copied at the SEC’s Public Reference Room in Washington, D.C.  Information on the operation of the Public Reference Room may be obtained by calling 1-800-732-0330.  The Funds’ Forms N-Q may also be obtained by calling toll-free 1-866-44BAIRD.

Page 120

(This Page Intentionally Left Blank.)

Baird Funds, Inc.

c/o U.S. Bancorp Fund Services, LLC

P.O. Box 701

Milwaukee, WI 53201-0701

1-866-44BAIRD

Board of Directors

G. Frederick Kasten, Jr. (Chairman)

John W. Feldt

Frederick P. Stratton, Jr.

Cory L. Nettles

Marlyn J. Spear

Investment Advisor and Distributor

Robert W. Baird & Co. Incorporated

777 East Wisconsin Avenue

Milwaukee, WI 53202

Administrator and Transfer Agent

U.S. Bancorp Fund Services, LLC

P.O. Box 701

615 East Michigan Street

Milwaukee, WI 53202

Custodian

U.S. Bank, N.A.

1555 N. RiverCenter Drive, Suite 302

Milwaukee, WI 53212

Legal Counsel

Godfrey & Kahn, S.C.

780 North Water Street

Milwaukee, WI 53202

Independent Registered Public Accounting Firm

Grant Thornton LLP

175 West Jackson Boulevard, 13th Floor

Chicago, IL 60604

Semi-Annual Report - Baird Funds

June 30, 2009

Baird LargeCap Fund

Baird MidCap Fund

TABLE OF CONTENTS

	Page
Baird LargeCap Fund	1
Baird MidCap Fund	9
Additional Information on Fund Expenses	17
Statements of Assets and Liabilities	19
Statements of Operations	20
Statements of Changes in Net Assets	21
Financial Highlights	23
Notes to the Financial Statements	27
Additional Information	36

This report has been prepared for shareholders and may be distributed to others only if preceded or accompanied by a current prospectus.

Cautionary Note on Analyses, Opinions and Outlooks:  In this report we offer analyses and opinions on the performance of individual securities, companies, industries, sectors, markets, interest rates and governmental policies, including predictions, forecasts and outlooks regarding possible future events.  These can generally be identified as such because the context of the statements may include such words as “believe,” “should,” “will,” “expects,” “anticipates,” “hopes” and words of similar effect.  These statements reflect the portfolio managers’ good faith beliefs and judgments and involve risks and uncertainties, including the risk that the portfolio managers’ analyses, opinions and outlooks are or will prove to be inaccurate.  It is inherently difficult to correctly assess and explain the performance of particular securities, sectors, markets, interest rate movements, governmental actions or general economic trends and conditions, and many unforeseen factors contribute to the performance of Baird Funds.  Investors are, therefore, cautioned not to place undue reliance on subjective judgments contained in this report.

Baird LargeCap Fund

A June 30, 2009 summary of the Fund’s top 10 holdings and equity sector analysis compared to the Russell 1000® Growth Index is shown below.

Top 10 Holdings*			Equity Sector Analysis**
Research In Motion Limited	3.9%
Iron Mountain Incorporated	3.0%
Southwestern Energy Company	2.8%
EMC Corporation	2.8%
Juniper Networks, Inc.	2.7%
Corning Incorporated	2.6%
Kohl’s Corporation	2.6%
Google, Inc. – Class A	2.5%
Danaher Corporation	2.4%
Baxter International, Inc.	2.4%
Net Assets:	$17,592,967
Portfolio Turnover Rate:	33.8%	†
Number of Equity Holdings:	57
Annualized Portfolio Expense Ratio:***
INSTITUTIONAL CLASS:	0.75%
INVESTOR CLASS:	1.00%	****

* The Fund’s portfolio composition is subject to change and there is no assurance that the Fund will continue to hold any particular security.  Percentages shown relate to the Fund’s total net assets as of June 30, 2009.

** Percentages shown in parentheses relate to the Fund’s total equity investments as of June 30, 2009, and may not add up to 100% due to rounding.

*** The Advisor has contractually agreed to limit the Fund’s total annual fund operating expenses to 0.75% of average daily net assets for the Institutional Class shares and 1.00% of average daily net assets for the Investor Class shares, at least through April 30, 2010.

**** Includes 0.25% 12b-1 fee.

† Not annualized.

Page 1

Baird LargeCap Fund

Average Annual Total Returns

For the Periods Ended June 30, 2009	One Year	Five Years	Since Inception(1)
Baird LargeCap Fund – Institutional Class Shares	-26.44%	-3.75%	-4.71%
Baird LargeCap Fund – Investor Class Shares	-26.60%	-3.96%	-4.95%
Russell 1000® Growth Index(2)	-24.50%	-1.83%	-6.63%

(1) For the period from September 29, 2000 (commencement of operations) through June 30, 2009.

(2) The Russell 1000® Growth Index measures the performance of those Russell 1000® companies with higher price-to-book ratios and higher forecasted growth values.  The Russell 1000® Index consists of the 1,000 largest companies in the Russell 3000® Index, which in turn is comprised of the 3,000 largest U.S. domiciled publicly traded common stocks by market capitalization.  These indices do not reflect any deduction for fees, expenses or taxes.  A direct investment in an index is not possible.

The returns shown in the table above reflect reinvestment of dividends and/or capital gains distributions in additional shares.  The returns do not reflect the deduction of taxes that a shareholder would pay on Fund distributions or the redemption of Fund shares.

Past performance does not guarantee future results.  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.

For information about the performance of the Fund as of the most recent month-end, please call 1-866-44BAIRD or visit www.bairdfunds.com.  Mutual fund performance changes over time and current performance may be lower or higher than that stated.

Page 2

Baird LargeCap Fund

Schedule of Investments       June 30, 2009 (Unaudited)

Shares			Value
COMMON STOCKS – 97.6%
Aerospace & Defense – 2.1%
	8,469	ITT Industries, Inc.	$	376,870
Air Freight & Logistics – 2.2%
	7,457	C.H. Robinson
		Worldwide, Inc.		388,883
Auto Components – 1.1%
	9,190	Johnson Controls, Inc.		199,607
Biotechnology – 1.9%
	2,300	Cephalon, Inc.*		130,295
	4,312	Gilead Sciences, Inc.*		201,974
				332,269
Capital Markets – 4.2%
	5,394	Northern Trust Corporation		289,550
	4,891	State Street Corporation		230,855
	5,314	T. Rowe Price Group, Inc.		221,435
				741,840
Chemicals – 5.6%
	10,505	Ecolab, Inc.		409,590
	2,485	Monsanto Company		184,735
	5,563	Praxair, Inc.		395,362
				989,687
Commercial Banks – 1.1%
	7,675	Wells Fargo & Company		186,196
Communications Equipment – 9.2%
	29,023	Corning Incorporated		466,109
	19,800	Juniper Networks, Inc.*		467,280
	9,600	Research In Motion
		Limited* f		682,080
				1,615,469
Computers & Peripherals – 4.9%
	37,256	EMC Corporation*		488,053
	9,675	Hewlett-Packard Company		373,939
				861,992
Diversified Financial Services – 1.8%
	9,359	J.P. Morgan Chase & Co.		319,235
Diversified Supply Services – 3.1%
	18,710	Iron Mountain
		Incorporated*		537,912
Electrical Equipment – 3.6%
	10,882	Emerson
		Electric Company		352,577
	1,733	First Solar, Inc.*		280,954
				633,531
Electronic Equipment & Instruments – 1.3%
	10,925	Agilent Technologies, Inc.*		221,887
Energy Equipment & Services – 4.7%
	8,181	Cameron International
		Corporation*		231,522
	3,862	Schlumberger Limited f		208,973
	2,054	Transocean Inc.* f		152,592
	12,300	Weatherford
		International Ltd.* f		240,588
				833,675
Food & Staples Retailing – 2.8%
	4,365	Costco Wholesale
		Corporation		199,481
	12,846	Sysco Corporation		288,778
				488,259
Health Care Equipment & Supplies – 3.4%
	7,916	Baxter International, Inc.		419,231
	18,225	Boston Scientific
		Corporation*		184,802
				604,033
Health Care Providers & Services – 1.7%
	4,375	Express Scripts, Inc.*		300,781
Hotels, Restaurants & Leisure – 2.2%
	7,750	International Game
		Technology		123,225

The accompanying notes are an integral part of these financial statements.

Page 3

Baird LargeCap Fund

Schedule of Investments       June 30, 2009 (Unaudited)

Shares			Value
COMMON STOCKS – 97.6% (cont.)
Hotels, Restaurants & Leisure – 2.2% (cont.)
	7,850	Yum! Brands, Inc.	$	261,719
				384,944
Internet Software & Services – 2.5%
	1,049	Google, Inc. – Class A*		442,248
IT Services – 3.5%
	5,725	Infosys Technologies
		Limited – ADR f		210,566
	24,383	Western Union Company		399,881
				610,447
Life Science Tools & Services – 1.4%
	5,946	Thermo Fisher
		Scientific, Inc.*		242,418
Machinery – 3.9%
	6,867	Danaher Corporation		423,969
	7,159	Illinois Tool Works, Inc.		267,317
				691,286
Media – 1.3%
	9,630	The Walt Disney Co.		224,668
Metals & Mining – 2.6%
	4,825	Freeport-McMoRan
		Copper & Gold, Inc.		241,781
	2,550	POSCO – ADR f		210,808
				452,589
Multiline Retail – 4.1%
	10,635	Kohl’s Corporation*		454,646
	6,795	Target Corporation		268,199
				722,845
Oil, Gas & Consumable Fuels – 3.7%
	3,310	Anadarko Petroleum
		Corporation		150,241
	12,900	Southwestern Energy
		Company*		501,165
				651,406
Pharmaceutical – 1.1%
	3,975	Allergan, Inc.		189,130
Semiconductor & Semiconductor Equipment – 6.4%
	23,590	Altera Corporation		384,045
	34,700	Applied Materials, Inc.		380,659
	7,632	Broadcom
		Corporation – Class A*		189,197
	8,137	Texas Instruments
		Incorporated		173,318
				1,127,219
Software – 3.8%
	13,280	Adobe Systems,
		Incorporated*		375,824
	9,311	Citrix Systems, Inc.*		296,928
				672,752
Specialty Retail – 3.0%
	10,699	Lowe’s Companies, Inc.		207,668
	16,279	Staples, Inc.		328,347
				536,015
Textiles, Apparel & Luxury Goods – 1.3%
	4,525	NIKE, Inc.		234,305
Trading Companies & Distributors – 2.1%
	10,922	Fastenal Company		362,283
		Total Common Stocks
		(Cost $17,108,297)		17,176,681
SHORT-TERM INVESTMENTS – 2.6%
Money Market Fund – 2.6%
	447,019	Short-Term Investment
		Company Liquid Assets
		Portfolio – AIM Fund		447,019
		Total Short-Term
		Investments
		(Cost $447,019)		447,019

The accompanying notes are an integral part of these financial statements.

Page 4

Baird LargeCap Fund

Schedule of Investments       June 30, 2009 (Unaudited)

Principal
Amount			Value
INVESTMENTS PURCHASED
WITH CASH PROCEEDS FROM
SECURITIES LENDING – 37.1%
Commercial Paper – 1.3%
$	237,930	Atlantic East
		Funding LLC,
		3.059%, 03/25/10 † **	$	237,930
				237,930
Corporate Bond – 0.6%
	104,269	Svenska Handelsbanken,
		4.418%, 08/06/09 f		104,269
				104,269
Shares
Investment Companies – 35.2%
	6,139,732	Mount Vernon
		Securities Lending
		Trust Prime Portfolio		6,139,732
	51,500	Reserve Primary Fund † **		51,500
				6,191,232
		Total Investments Purchased
		With Cash Proceeds From
		Securities Lending
		(Cost $6,533,431)		6,533,431
		Total Investments
		(Cost $24,088,747) –
		137.3%		24,157,131
		Liabilities in Excess of
		Other Assets – (37.3)%		(6,564,164	)
		TOTAL NET
		ASSETS – 100.0%	$	17,592,967

* Non-Income Producing

** Illiquid Security

f Foreign Security

† Priced at Fair Value by the Valuation Committee as delegated by the Baird Funds’ Board of Directors

The accompanying notes are an integral part of these financial statements.

Page 5

Baird LargeCap Fund

SFAS 157 – Summary of Fair Value Exposure at June 30, 2009 (Unaudited)

As adopted by the Fund, the Financial Accounting Standards Board issued Statement of Financial Accounting Standards No. 157, “Fair Value Measurements” (“SFAS 157”) defines fair value, establishes a framework for measuring fair value in generally accepted accounting principles (GAAP), and expands disclosures about fair value measurements.  Under SFAS 157, various inputs are used in determining the value of the Fund’s investments.  These inputs are summarized into three broad levels and described below:

Level 1 –	Quoted prices in active markets for identical securities.
Level 2 –	Other significant observable inputs (including quoted prices for similar securities, quoted prices in inactive markets, dealer indications, interest rates, yield curves, prepayment speeds, credit risk, default rates, inputs corroborated by observable market data, etc.)
Level 3 –	Significant unobservable inputs (including the Fund’s own assumptions about the assumptions that market participants would use in pricing the security)

The inputs or methodology used for valuing securities are not necessarily an indication of the risk associated with investing in those securities.

Page 6

Baird LargeCap Fund

SFAS 157 – Summary of Fair Value Exposure at June 30, 2009 (Unaudited)

The following is a summary of the inputs used to value the Fund’s investments as of June 30, 2009:

	Level 1		Level 2		Level 3		Total
Equity
Aerospace & Defense	$	376,870	$	—	$	—	$	376,870
Air Freight & Logistics		388,883		—		—		388,883
Auto Components		199,607		—		—		199,607
Biotechnology		332,269		—		—		332,269
Capital Markets		741,840		—		—		741,840
Chemicals		989,687		—		—		989,687
Commercial Banks		186,196		—		—		186,196
Communications Equipment		1,615,469		—		—		1,615,469
Computers & Peripherals		861,992		—		—		861,992
Diversified Financial Services		319,235		—		—		319,235
Diversified Supply Services		537,912		—		—		537,912
Electrical Equipment		633,531		—		—		633,531
Electronic Equipment & Instruments		221,887		—		—		221,887
Energy Equipment & Services		833,675		—		—		833,675
Food & Staples Retailing		488,259		—		—		488,259
Health Care Equipment & Supplies		604,033		—		—		604,033
Health Care Providers & Services		300,781		—		—		300,781
Hotels, Restaurants & Leisure		384,944		—		—		384,944
Internet Software & Services		442,248		—		—		442,248
IT Services		610,447		—		—		610,447
Life Science Tools & Services		242,418		—		—		242,418
Machinery		691,286		—		—		691,286
Media		224,668		—		—		224,668
Metals & Mining		452,589		—		—		452,589
Multiline Retail		722,845		—		—		722,845
Oil, Gas & Consumable Fuels		651,406		—		—		651,406
Pharmaceutical		189,130		—		—		189,130
Semiconductor & Semiconductor Equipment		1,127,219		—		—		1,127,219
Software		672,752		—		—		672,752
Specialty Retail		536,015		—		—		536,015
Textiles, Apparel & Luxury Goods		234,305		—		—		234,305
Trading Companies & Distributors		362,283		—		—		362,283
Total Equity		17,176,681		—		—		17,176,681
Short-Term Investments
Money Market Mutual Funds		447,019		—		—		447,019
Total Short-Term Investments		447,019		—		—		447,019
Investments Purchased with Cash
Proceeds from Securities Lending
Commercial Paper		—		237,930		—		237,930
Corporate Bond		—		104,269		—		104,269
Money Market Mutual Funds		6,139,732		—		51,500		6,191,232
Total Investments Purchased with
Cash Proceeds from Securities Lending		6,139,732		342,199		51,500		6,533,431
Total Investments in Securities	$	23,763,432	$	342,199	$	51,500	$	24,157,131

Page 7

Baird LargeCap Fund

SFAS 157 – Summary of Fair Value Exposure at June 30, 2009 (Unaudited)

Level 3 Reconciliation Disclosure

Following is a reconciliation of Level 3 assets for which significant unobservable inputs were used to determine fair value.

Description	Investments in Securities
Balance as of December 31, 2008	$	109,173
Accrued discounts/premiums		—
Realized gain (loss)		—
Change in unrealized appreciation (depreciation)		—
Net purchases (sales)		(57,673	)
Transfers in and/or out of Level 3*		—
Balance as of June 30, 2009	$	51,500
Change in unrealized appreciation (depreciation) during
the year for level 3 investments held at June 30, 2009.		—

* The information used in the above reconciliation represents fiscal year to date activity for any investments identified as using Level 3 inputs at either the beginning or end of the current fiscal period.  Transfers in or out of Level 3 represents either the beginning value (for transfers in) or ending value (for transfers out) of any security or instrument where a change in the pricing level occurred from the beginning to the end of the period.

Page 8

Baird MidCap Fund

A June 30, 2009 summary of the Fund’s top 10 holdings and equity sector analysis compared to the Russell Midcap® Growth Index is shown below.

Top 10 Holdings*			Equity Sector Analysis**
Oceaneering International, Inc.	2.5%
Roper Industries, Inc.	2.5%
Life Technologies Corporation	2.3%
Cameron International Corporation	2.3%
Ecolab, Inc.	2.3%
Airgas, Inc.	2.2%
Tractor Supply Company	2.2%
Fiserv, Inc.	2.2%
NetApp, Inc.	2.2%
Alliance Data Systems Corporation	2.2%
Net Assets:	$22,061,983
Portfolio Turnover Rate:	33.6%	†
Number of Equity Holdings:	59
Annualized Portfolio Expense Ratio:***
INSTITUTIONAL CLASS:	0.85%
INVESTOR CLASS:	1.10%	****

* The Fund’s portfolio composition is subject to change and there is no assurance that the Fund will continue to hold any particular security.  Percentages shown relate to the Fund’s total net assets as of June 30, 2009.

** Percentages shown in parentheses relate to the Fund’s total equity investments as of June 30, 2009, and may not add up to 100% due to rounding.

*** The Advisor has contractually agreed to limit the Fund’s total annual fund operating expenses to 0.85% of average daily net assets for the Institutional Class shares and 1.10% of average daily net assets for the Investor Class shares, at least through April 30, 2010.

**** Includes 0.25% 12b-1 fee.

† Not annualized.

Page 9

Baird MidCap Fund

Average Annual Total Returns

For the Periods Ended June 30, 2009	One Year	Five Years	Since Inception(1)
Baird MidCap Fund – Institutional Class Shares	-23.77%	-1.57%	-0.49%
Baird MidCap Fund – Investor Class Shares	-23.93%	-1.79%	-0.71%
Russell Midcap® Growth Index(2)	-30.33%	-0.44%	-2.10%

(1) For the period from December 29, 2000 (commencement of operations) through June 30, 2009.

(2) The Russell Midcap® Growth Index measures the performance of those Russell Midcap® Index companies with higher price-to-book ratios and higher forecasted growth values.  The Russell Midcap® Index consists of the 800 smallest companies in the Russell 1000® Index, which represent approximately 27% of the total market capitalization of the Russell 1000® Index.  The Russell 1000® Index consists of the largest companies in the Russell 3000® Index, which in turn is comprised of the 3,000 largest U.S. domiciled publicly traded common stocks by market capitalization.  These indices do not reflect any deduction for fees, expenses or taxes.  A direct investment in an index is not possible.

The returns shown in the table above reflect reinvestment of dividends and/or capital gains distributions in additional shares.  The returns do not reflect the deduction of taxes that a shareholder would pay on Fund distributions or the redemption of Fund shares.

Past performance does not guarantee future results.  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.

For information about the performance of the Fund as of the most recent month-end, please call 1-866-44BAIRD or visit www.bairdfunds.com.  Mutual fund performance changes over time and current performance may be lower or higher than that stated.

Page 10

Baird MidCap Fund

Schedule of Investments       June 30, 2009 (Unaudited)

Shares			Value
COMMON STOCKS – 97.6%
Air Freight & Logistics – 1.1%
	7,104	Expeditors International
		of Washington, Inc.	$	236,847
Auto Components – 1.0%
	10,525	Johnson Controls, Inc.		228,603
Biotechnology – 2.0%
	7,682	Cephalon, Inc.*		435,185
Capital Markets – 3.8%
	12,806	Eaton Vance Corporation		342,561
	3,588	Greenhill & Co., Inc.		259,089
	5,970	T. Rowe Price Group, Inc.		248,770
				850,420
Chemicals – 4.5%
	12,033	Airgas, Inc.		487,697
	12,807	Ecolab, Inc.		499,345
				987,042
Commercial Banks – 1.7%
	10,688	PrivateBancorp, Inc.		237,701
	12,782	Zions Bancorporation		147,760
				385,461
Commercial Services & Supplies – 1.4%
	5,815	Stericycle, Inc.*		299,647
Communications Equipment – 1.6%
	10,355	F5 Networks, Inc.*		358,180
Computers & Peripherals – 2.2%
	24,124	NetApp, Inc.*		475,725
Construction & Engineering – 0.9%
	8,848	Foster Wheeler Ltd* f		210,140
Containers & Packaging – 2.1%
	13,795	AptarGroup, Inc.		465,857
Distributors – 2.0%
	26,325	LKQ Corporation*		433,046
Diversified Supply Services – 1.6%
	12,008	Iron Mountain
		Incorporated*		345,230
Electrical Equipment – 2.5%
	12,152	Roper Industries, Inc.		550,607
Electronic Component – 1.8%
	10,895	Dolby Laboratories, Inc.*		406,166
Energy Equipment & Services – 6.6%
	17,999	Cameron International
		Corporation*		509,372
	12,330	Oceaneering
		International, Inc.*		557,316
	14,780	Smith International, Inc.		380,585
				1,447,273
Food Products – 2.8%
	17,925	Hain Celestial Group Inc.*		279,809
	10,467	McCormick & Co,
		Incorporated		340,492
				620,301
Health Care Equipment & Supplies – 2.8%
	4,925	IDEXX Laboratories, Inc.*		227,535
	5,375	St. Jude Medical, Inc.*		220,913
	6,200	Thoratec Corporation*		166,036
				614,484
Health Care Providers & Services – 1.1%
	15,025	Allscripts-Misys
		Healthcare Solutions, Inc.		238,296
Health Care Technology – 1.6%
	18,725	MedAssets Inc.*		364,201
Hotels Restaurants & Leisure – 4.3%
	9,450	Buffalo Wild Wings Inc.*		307,314
	17,275	Burger King Holdings Inc.		298,339
	10,650	WMS Industries Inc.*		335,582
				941,235
Internet Software & Services – 1.9%
	21,517	Akamai
		Technologies, Inc.*		412,696

The accompanying notes are an integral part of these financial statements.

Page 11

Baird MidCap Fund

Schedule of Investments       June 30, 2009 (Unaudited)

Shares			Value
COMMON STOCKS – 97.6% (cont.)
IT Services – 7.7%
	11,544	Alliance Data
		Systems Corporation*	$	475,497
	10,549	Fiserv, Inc.*		482,089
	10,321	Hewitt Associates,
		Inc. – Class A*		307,360
	17,160	Paychex, Inc.		432,432
				1,697,378
Life Sciences Tools & Services – 5.8%
	20,425	ICON PLC – ADR f		440,772
	12,300	Life Technologies
		Corporation*		513,156
	4,350	Mettler-Toledo
		International Inc.*		335,603
				1,289,531
Machinery – 7.2%
	11,870	Bucyrus International,
		Inc. – Class A		339,007
	15,553	Harsco Corporation		440,150
	18,475	IDEX Corporation		453,931
	11,074	Wabtec Corporation		356,251
				1,589,339
Media – 1.9%
	27,970	Lamar Advertising
		Co. – Class A*		427,102
Oil & Gas – 1.9%
	17,225	Goodrich Petroleum
		Corporation*		423,563
Road & Rail – 1.1%
	7,995	J.B. Hunt Transport
		Services, Inc.		244,087
Semiconductor & Semiconductor Equipment – 5.6%
	22,425	Altera Corporation		365,079
	19,188	Microchip Technology
		Incorporated		432,689
	17,900	Varian Semiconductor
		Equipment Associates, Inc.*		429,421
				1,227,189
Software – 3.3%
	14,589	Citrix Systems, Inc.*		465,243
	6,900	Salesforce.com, Inc.*		263,373
				728,616
Specialty Retail – 7.0%
	21,906	Dick’s Sporting
		Goods, Inc.*		376,783
	19,620	PetSmart, Inc.		421,045
	11,700	Tractor Supply Company*		483,444
	12,650	Urban Outfitters, Inc.*		264,006
				1,545,278
Textiles, Apparel & Luxury Goods – 1.8%
	13,702	Phillips-Van Heusen
		Corporation		393,110
Trading Companies & Distributors – 3.0%
	12,151	Fastenal Company		403,048
	5,275	Watsco, Inc.		258,106
				661,154
		Total Common Stocks
		(Cost $22,559,079)		21,532,989
SHORT-TERM INVESTMENTS – 2.8%
Money Market Fund – 2.8%
	602,448	Short-Term Investment
		Company Liquid Assets
		Portfolio – AIM Fund		602,448
		Total Short-Term
		Investments
		(Cost $602,448)		602,448

The accompanying notes are an integral part of these financial statements.

Page 12

Baird MidCap Fund

Schedule of Investments       June 30, 2009 (Unaudited)

Principal
Amount			Value
INVESTMENTS PURCHASED
WITH CASH PROCEEDS FROM
SECURITIES LENDING – 37.3%
Commercial Paper – 1.5%
$	334,935	Atlantic East Funding LLC,
		3.059%, 03/25/10 † **	$	334,935
				334,935
Corporate Bond – 0.6%
	131,137	Svenska Handelsbanken,
		4.418%, 08/06/09 f		131,137
				131,137
Shares
Investment Companies – 35.2%
	7,721,851	Mount Vernon
		Securities Lending
		Trust Prime Portfolio		7,721,851
	50,233	Reserve Primary Fund † **		50,233
				7,772,084
		Total Investments Purchased
		With Cash Proceeds From
		Securities Lending
		(Cost $8,238,156)		8,238,156
		Total Investments
		(Cost $31,399,683) –
		137.7%		30,373,593
		Liabilities in Excess of
		Other Assets – (37.7)%		(8,311,610	)
		TOTAL NET
		ASSETS – 100.0%	$	22,061,983

* Non-Income Producing

** Illiquid Security

f Foreign Security

† Priced at Fair Value by the Valuation Committee as delegated by the Baird Funds’ Board of Directors

The accompanying notes are an integral part of these financial statements.

Page 13

Baird MidCap Fund

SFAS 157 – Summary of Fair Value Exposure at June 30, 2009 (Unaudited)

As adopted by the Fund, the Financial Accounting Standards Board issued Statement of Financial Accounting Standards No. 157, “Fair Value Measurements” (“SFAS 157”) defines fair value, establishes a framework for measuring fair value in generally accepted accounting principles (GAAP), and expands disclosures about fair value measurements.  Under SFAS 157, various inputs are used in determining the value of the Fund’s investments.  These inputs are summarized into three broad levels and described below:

Level 1 –	Quoted prices in active markets for identical securities.
Level 2 –	Other significant observable inputs (including quoted prices for similar securities, quoted prices in inactive markets, dealer indications, interest rates, yield curves, prepayment speeds, credit risk, default rates, inputs corroborated by observable market data, etc.).
Level 3 –	Significant unobservable inputs (including the Fund’s own assumptions about the assumptions that market participants would use in pricing the security).

The inputs or methodology used for valuing securities are not necessarily an indication of the risk associated with investing in those securities.

Page 14

Baird MidCap Fund

SFAS 157 – Summary of Fair Value Exposure at June 30, 2009 (Unaudited)

The following is a summary of the inputs used to value the Fund’s investments as of June 30, 2009:

	Level 1		Level 2		Level 3		Total
Equity
Air Freight & Logistics	$	236,847	$	—	$	—	$	236,847
Auto Components		228,603		—		—		228,603
Biotechnology		435,185		—		—		435,185
Capital Markets		850,420		—		—		850,420
Chemicals		987,042		—		—		987,042
Commercial Banks		385,461		—		—		385,461
Commercial Services & Supplies		299,647		—		—		299,647
Communications Equipment		358,180		—		—		358,180
Computers & Peripherals		475,725		—		—		475,725
Construction & Engineering		210,140		—		—		210,140
Containers & Packaging		465,857		—		—		465,857
Distributors		433,046		—		—		433,046
Diversified Supply Services		345,230		—		—		345,230
Electrical Equipment		550,607		—		—		550,607
Electronic Component		406,166		—		—		406,166
Energy Equipment & Services		1,447,273		—		—		1,447,273
Food Products		620,301		—		—		620,301
Health Care Equipment & Supplies		614,484		—		—		614,484
Health Care Providers & Services		238,296		—		—		238,296
Health Care Technology		364,201		—		—		364,201
Hotels Restaurants & Leisure		941,235		—		—		941,235
Internet Software & Services		412,696		—		—		412,696
IT Services		1,697,378		—		—		1,697,378
Life Sciences Tools & Services		1,289,531		—		—		1,289,531
Machinery		1,589,339		—		—		1,589,339
Media		427,102		—		—		427,102
Oil & Gas		423,563		—		—		423,563
Road & Rail		244,087		—		—		244,087
Semiconductor & Semiconductor Equipment		1,227,189		—		—		1,227,189
Software		728,616		—		—		728,616
Specialty Retail		1,545,278		—		—		1,545,278
Textiles, Apparel & Luxury Goods		393,110		—		—		393,110
Trading Companies & Distributors		661,154		—		—		661,154
Total Equity		21,532,989		—		—		21,532,989
Short-Term Investments
Money Market Mutual Funds		602,448		—		—		602,448
Total Short-Term Investments		602,448		—		—		602,448
Investments Purchased with Cash
Proceeds from Securities Lending
Commercial Paper		—		334,935		—		334,935
Corporate Bond		—		131,137		—		131,137
Money Market Mutual Funds		7,721,851		—		50,233		7,772,084
Total Investments Purchased with Cash
Proceeds from Securities Lending		7,721,851		466,072		50,233		8,238,156
Total Investments in Securities	$	29,857,288	$	466,072	$	50,233	$	30,373,593

Page 15

Baird MidCap Fund

SFAS 157 – Summary of Fair Value Exposure at June 30, 2009 (Unaudited)

Level 3 Reconciliation Disclosure

Following is a reconciliation of Level 3 assets for which significant unobservable inputs were used to determine fair value.

Description	Investments in Securities
Balance as of December 31, 2008	$	106,487
Accrued discounts/premiums		—
Realized gain (loss)		—
Change in unrealized appreciation (depreciation)		—
Net purchases (sales)		(56,254	)
Transfers in and/or out of Level 3*		—
Balance as of June 30, 2009	$	50,233
Change in unrealized appreciation (depreciation) during
the year for level 3 investments held at June 30, 2009.		—

* The information used in the above reconciliation represents fiscal year to date activity for any investments identified as using Level 3 inputs at either the beginning or end of the current fiscal period.  Transfers in or out of Level 3 represents either the beginning value (for transfers in) or ending value (for transfers out) of any security or instrument where a change in the pricing level occurred from the beginning to the end of the period.

Page 16

Baird Funds, Inc.

Additional Information on Fund Expenses       June 30, 2009 (Unaudited)

Example

As a shareholder of a mutual fund, you incur two types of costs: (1) transaction costs, which may include sales charges (loads) on purchase payments, reinvested dividends, or other distributions; redemption fees; and exchange fees; and (2) ongoing costs, such as management fees; distribution and/or service (12b-1) fees; and other fund expenses.  Although the Funds do not charge any sales loads, redemption fees, or other transaction fees, you will be assessed fees for outgoing wire transfers, returned checks and stop payment orders at prevailing rates charged by U.S. Bancorp Fund Services, LLC, the Fund’s transfer agent.  If you request that a redemption be made by wire transfer, currently the Fund’s transfer agent charges a $15.00 fee.

This Example is intended to help you understand your ongoing costs (in dollars) of investing in each Fund and to compare these costs with the ongoing costs of investing in other mutual funds.  The Example is based on an investment of $1,000 invested at the beginning of the period and held for the entire period (1/1/09 – 6/30/09).

Actual Expenses

The third and fourth columns of the following table provide information about account values based on actual returns and actual expenses.  You may use the information in these columns, together with the amount you invested, to estimate the expenses that you paid over the period. Simply divide your account value by $1,000 (for example, an $8,600 account value divided by $1,000 – 8.6), then multiply the result by the number in the fourth column entitled “Expenses Paid During Period’’ to estimate the expenses you paid on your account during this period.

Hypothetical Example for Comparison Purposes

The fifth and sixth columns of the following table provide information about hypothetical account values and hypothetical expenses based on the Funds’ actual expense ratios and an assumed rate of return of 5% per year before expenses, which is not the Funds’ actual return. The hypothetical account values and expenses may not be used to estimate the actual ending account balance or expenses you paid for the period. You may use this information to compare the ongoing costs of investing in the Funds and other mutual funds. To do so, compare this 5% hypothetical example with the 5% hypothetical examples that appear in the shareholder reports of the other mutual funds.  Please note that the expenses shown in the table are meant to highlight your ongoing costs only and do not reflect any transactional costs.  Therefore, the sixth column of the table (entitled “Expenses Paid During Period”) is useful in comparing ongoing costs only, and will not help you determine the relative total costs of owning different mutual funds. In addition, if these transactional costs were included, your costs could have been higher.

Page 17

Baird Funds, Inc.

Additional Information on Fund Expenses       June 30, 2009 (Unaudited)

Actual vs. Hypothetical Returns

For the Six Months Ended June 30, 2009

					Hypothetical (5% return
			Actual		before expenses)
	Fund’s	Beginning	Ending	Expenses	Ending	Expenses
	Annualized	Account	Account	Paid	Account	Paid
	Expense	Value	Value	During	Value	During
	Ratio(1)	1/1/09	6/30/09	Period(1)	6/30/09	Period(1)
Baird LargeCap Fund
Institutional Class	0.75%	$1,000.00	$1,134.40	$3.97	$1,021.08	$3.76
Investor Class	1.00%	$1,000.00	$1,132.60	$5.29	$1,019.84	$5.01
Baird MidCap Fund
Institutional Class	0.85%	$1,000.00	$1,131.70	$4.49	$1,020.58	$4.26
Investor Class	1.10%	$1,000.00	$1,131.40	$5.81	$1,019.34	$5.51

(1) Expenses are equal to the Fund’s annualized expense ratio multiplied by the average account value over the period, multiplied by 181 days and divided by 365 to reflect the one-half year period.

Page 18

Baird Funds, Inc.

Statements of Assets and Liabilities       June 30, 2009 (Unaudited)

	Baird LargeCap			Baird MidCap
	Fund			Fund
ASSETS:
Investments, at value	$	24,157,131		$	30,373,593
(cost $24,088,747 and $31,399,683, respectively)
Dividends receivable		20,187			4,935
Interest receivable		182			278
Receivable for fund shares sold		—			15,200
Other assets		14,894			16,229
Total assets		24,192,394			30,410,235
LIABILITIES:
Payable for collateral received for securities loaned		6,533,431			8,238,156
Payable to Advisor and Distributor		1,898			9,388
Payable to Custodian		14,118			36,183
Payable for fund shares repurchased		18,977			27,311
Accrued expenses and other liabilities		31,003			37,214
Total liabilities		6,599,427			8,348,252
NET ASSETS	$	17,592,967		$	22,061,983
NET ASSETS CONSIST OF:
Capital stock	$	23,245,674		$	26,651,734
Accumulated undistributed net investment income		44,629			11,224
Accumulated net realized loss on investments sold		(5,765,720	)		(3,574,885	)
Net unrealized appreciation (depreciation) on investments		68,384			(1,026,090	)
NET ASSETS	$	17,592,967		$	22,061,983
INSTITUTIONAL CLASS SHARES
Net Assets	$	17,295,740		$	20,474,908
Shares outstanding
($0.01 par value, unlimited shares authorized)		2,732,767			3,218,496
Net asset value, offering and redemption price per share	$	6.33		$	6.36
INVESTOR CLASS SHARES
Net Assets	$	297,227		$	1,587,075
Shares outstanding
($0.01 par value, unlimited shares authorized)		47,054			256,071
Net asset value, offering and redemption price per share	$	6.32		$	6.20

The accompanying notes are an integral part of these financial statements.

Page 19

Baird Funds, Inc.

Statements of Operations       Six Months Ended June 30, 2009 (Unaudited)

	Baird			Baird
	LargeCap Fund			MidCap Fund
INVESTMENT INCOME:
Dividends (net of foreign taxes withheld of $114 and $0, respectively)	$	99,154		$	82,168
Income from securities lending (Note 6)		6,051			13,003
Interest		2,593			2,750
Total investment income		107,798			97,921
EXPENSES:
Investment advisory fees		54,628			74,854
Administration fees		2,148			2,498
Shareholder servicing fees		7,533			7,571
Fund accounting fees		1,767			2,041
Professional fees		14,337			13,987
Federal and state registration		14,149			11,636
Directors fees		12,560			12,460
Custody fees		2,753			2,839
Reports to shareholders		1,953			2,665
Distribution fees – Investor Class Shares (Note 8)		335			1,862
Miscellaneous expenses		662			831
Total expenses		112,825			133,244
Expense reimbursement by Advisor (Note 5)		(49,458	)		(46,547	)
Total expenses		63,367			86,697
NET INVESTMENT INCOME		44,431			11,224
REALIZED AND UNREALIZED GAIN ON INVESTMENTS:
Net realized loss on investments		(1,618,686	)		(306,038	)
Change in unrealized appreciation/depreciation on investments		3,775,678			2,883,196
Net realized and unrealized gain on investments		2,156,992			2,577,158
NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS	$	2,201,423		$	2,588,382

The accompanying notes are an integral part of these financial statements.

Page 20

Baird Funds, Inc.

Statements of Changes in Net Assets

	Baird LargeCap Fund
	Six Months Ended
	June 30, 2009			Year Ended
	(Unaudited)			December 31, 2008
OPERATIONS:
Net investment income	$	44,431		$	75,378
Net realized loss on investments		(1,618,686	)		(2,680,501	)
Change in unrealized appreciation/depreciation on investments		3,775,678			(8,322,225	)
Net increase (decrease) in net assets resulting from operations		2,201,423			(10,927,348	)
CAPITAL SHARE TRANSACTIONS:
Proceeds from shares sold		1,272,139			2,906,588
Shares issued to holders in reinvestment of dividends		—			80,523
Cost of shares redeemed		(2,490,818	)		(3,752,903	)
Net decrease in net assets resulting from capital share transactions		(1,218,679	)		(765,792	)
DISTRIBUTIONS TO
INSTITUTIONAL CLASS SHAREHOLDERS:
From net investment income		—			(81,425	)
DISTRIBUTIONS TO
INVESTOR CLASS SHAREHOLDERS:
From net investment income		—			—
TOTAL INCREASE (DECREASE) IN NET ASSETS		982,744			(11,774,565	)
NET ASSETS:
Beginning of period		16,610,223			28,384,788
End of period (including undistributed net investment income
of $44,629 and $198, respectively)	$	17,592,967		$	16,610,223

The accompanying notes are an integral part of these financial statements.

Page 21

Baird Funds, Inc.

Statements of Changes in Net Assets

	Baird MidCap Fund
	Six Months Ended
	June 30, 2009			Year Ended
	(Unaudited)			December 31, 2008
OPERATIONS:
Net investment income	$	11,224		$	10,353
Net realized loss on investments		(306,038	)		(2,859,632	)
Change in unrealized appreciation/depreciation on investments		2,883,196			(12,378,757	)
Net increase (decrease) in net assets resulting from operations		2,588,382			(15,228,036	)
CAPITAL SHARE TRANSACTIONS:
Proceeds from shares sold		998,438			3,082,022
Shares issued to holders in reinvestment of dividends		—			14,311
Cost of shares redeemed		(1,251,657	)		(9,527,280	)
Net decrease in net assets resulting from capital share transactions		(253,219	)		(6,430,947	)
DISTRIBUTIONS TO
INSTITUTIONAL CLASS SHAREHOLDERS:
From net investment income		—			(14,588	)
DISTRIBUTIONS TO
INVESTOR CLASS SHAREHOLDERS:
From net investment income		—			—
TOTAL INCREASE (DECREASE) IN NET ASSETS		2,335,163			(21,673,571	)
NET ASSETS:
Beginning of period		19,726,820			41,400,391
End of period (including undistributed net investment income
of $11,224 and $0, respectively)	$	22,061,983		$	19,726,820

The accompanying notes are an integral part of these financial statements.

Page 22

Baird Funds, Inc.

Financial Highlights

	Baird LargeCap Fund – Institutional Class
	Six Months
	Ended
	June 30, 2009			Year Ended December 31,
	(Unaudited)			2008			2007			2006			2005			2004
Per Share Data:
Net asset value, beginning of period	$	5.59		$	9.33		$	8.53		$	8.33		$	8.13		$	7.78
Income from investment operations:
Net investment income		0.02			0.03			0.02			0.04			0.04	(1)		0.06	(1)
Net realized and unrealized
gains (losses) on investments		0.72			(3.74	)		0.80			0.20			0.24			0.35
Total from investment operations		0.74			(3.71	)		0.82			0.24			0.28			0.41
Less distributions:
Dividends from net investment income		—			(0.03	)		(0.02	)		(0.04	)		(0.08	)		(0.06	)
Net asset value, end of period	$	6.33		$	5.59		$	9.33		$	8.53		$	8.33		$	8.13
Total return		13.44	%(2)		(39.88	%)		9.63	%		2.89	%		3.39	%		5.21	%
Supplemental data and ratios:
Net assets, end of period	$	17,295,740		$	16,349,025		$	27,644,009		$	27,442,329		$	27,375,626		$	64,754,140
Ratio of expenses to average net assets		0.75	%(3)		0.75	%		0.75	%		0.75	%		0.75	%		0.75	%
Ratio of expenses to average
net assets (before waivers)		1.34	%(3)		1.17	%		1.10	%		1.12	%		0.93	%		0.93	%
Ratio of net investment income
to average net assets		0.53	%(3)		0.32	%		0.25	%		0.44	%		0.46	%		0.72	%
Ratio of net investment income (loss)
to average net assets (before waivers)		(0.06	%)(3)		(0.10	%)		(0.10	%)		0.07	%		0.28	%		0.54	%
Portfolio turnover rate(4)		33.8	%(2)		43.0	%		72.2	%		63.9	%		28.6	%		23.2	%

(1) Calculated using average shares outstanding during the period.

(2) Not annualized.

(3) Annualized.

(4) Portfolio turnover is calculated on the basis of the Fund as a whole without distinguishing between the classes of shares issued.

The accompanying notes are an integral part of these financial statements.

Page 23

Baird Funds, Inc.

Financial Highlights

	Baird LargeCap Fund – Investor Class
	Six Months
	Ended
	June 30, 2009			Year Ended December 31,
	(Unaudited)			2008			2007			2006			2005			2004
Per Share Data:
Net asset value, beginning of period	$	5.59		$	9.29		$	8.50		$	8.29		$	8.09		$	7.75
Income from investment operations:
Net investment income		0.01			0.00	(1)		0.00	(1)		0.01			0.02	(2)		0.04	(2)
Net realized and unrealized
gains (losses) on investments		0.72			(3.70	)		0.79			0.21			0.23			0.35
Total from investment operations		0.73			(3.70	)		0.79			0.22			0.25			0.39
Less distributions:
Dividends from net investment income		—			—			—			(0.01	)		(0.05	)		(0.05	)
Net asset value, end of period	$	6.32		$	5.59		$	9.29		$	8.50		$	8.29		$	8.09
Total return		(13.26	%)(3)		(39.94	%)		9.29	%		2.64	%		3.15	%		5.00	%
Supplemental data and ratios:
Net assets, end of period	$	297,227		$	261,198		$	740,779		$	1,087,948		$	2,400,525		$	1,900,053
Ratio of expenses to average net assets		1.00	%(4)		1.00	%		1.00	%		1.00	%		1.00	%		1.00	%
Ratio of expenses to average
net assets (before waivers)		1.59	%(4)		1.42	%		1.35	%		1.37	%		1.18	%		1.18	%
Ratio of net investment income
to average net assets		0.28	%(4)		0.07	%		0.00	%		0.19	%		0.21	%		0.47	%
Ratio of net investment income (loss)
to average net assets (before waivers)		(0.31	%)(4)		(0.35	%)		(0.35	%)		(0.18	%)		0.03	%		0.29	%
Portfolio turnover rate(5)		33.8	%(3)		43.0	%		72.2	%		63.9	%		28.6	%		23.2	%

(1) Amount is less than $0.01.

(2) Calculated using average shares outstanding during the period.

(3) Not annualized.

(4) Annualized.

(5) Portfolio turnover is calculated on the basis of the Fund as a whole without distinguishing between the classes of shares issued.

The accompanying notes are an integral part of these financial statements.

Page 24

Baird Funds, Inc.

Financial Highlights

	Baird MidCap Fund – Institutional Class
	Six Months
	Ended
	June 30, 2009			Year Ended December 31,
	(Unaudited)			2008			2007			2006			2005			2004
Per Share Data:
Net asset value, beginning of period	$	5.63		$	9.62		$	9.33		$	11.12		$	10.91		$	9.72
Income from investment operations:
Net investment income (loss)(1)		0.01			0.01			(0.01	)		(0.02	)		(0.02	)		(0.04	)
Net realized and unrealized
gains (losses) on investments		0.72			(3.99	)		1.99			0.46			0.63			1.25
Total from investment operations		0.73			(3.98	)		1.98			0.44			0.61			1.21
Less distributions:
Distributions from net investment income		—			(0.01	)		—			—			—			—
Distributions from net realized gains		—			—			(1.69	)		(2.23	)		(0.40	)		(0.02	)
Total distributions		—			(0.01	)		(1.69	)		(2.23	)		(0.40	)		(0.02	)
Net asset value, end of period	$	6.36		$	5.63		$	9.62		$	9.33		$	11.12		$	10.91
Total return		13.17	%(2)		(41.53	%)		20.89	%		3.93	%		5.56	%		12.44	%
Supplemental data and ratios:
Net assets, end of period	$	20,474,908		$	18,163,034		$	36,616,547		$	32,057,214		$	85,670,669		$	86,476,869
Ratio of expenses to average net assets		0.85	%(3)		0.85	%		0.85	%		0.85	%		0.85	%		0.85	%
Ratio of expenses to average
net assets (before waivers)		1.32	%(3)		1.19	%		1.11	%		1.01	%		0.98	%		1.05	%
Ratio of net investment income (loss)
to average net assets		0.13	%(3)		0.06	%		(0.06	%)		(0.17	%)		(0.21	%)		(0.43	%)
Ratio of net investment income (loss)
to average net assets (before waivers)		(0.34	%)(3)		(0.28	%)		(0.32	%)		(0.33	%)		(0.34	%)		(0.63	%)
Portfolio turnover rate(4)		33.6	%(2)		74.0	%		72.3	%		78.6	%		77.4	%		77.9	%

(1) Calculated using average shares outstanding during the period.

(2) Not annualized.

(3) Annualized.

(4) Portfolio turnover is calculated on the basis of the Fund as a whole without distinguishing between the classes of shares issued.

The accompanying notes are an integral part of these financial statements.

Page 25

Baird Funds, Inc.

Financial Highlights

	Baird MidCap Fund – Investor Class
	Six Months
	Ended
	June 30, 2009			Year Ended December 31,
	(Unaudited)			2008			2007			2006			2005			2004
Per Share Data:
Net asset value, beginning of period	$	5.49		$	9.40		$	9.17		$	10.99		$	10.82		$	9.65
Income from investment operations:
Net investment loss(1)		(0.00	)(2)		(0.02	)		(0.04	)		(0.04	)		(0.05	)		(0.07	)
Net realized and unrealized
gains (losses) on investments		0.71			(3.89	)		1.96			0.45			0.62			1.26
Total from investment operations		0.71			(3.91	)		1.92			0.41			0.57			1.19
Less distributions:
Distributions from net realized gains		—			—			(1.69	)		(2.23	)		(0.40	)		(0.02	)
Net asset value, end of period	$	6.20		$	5.49		$	9.40		$	9.17		$	10.99		$	10.82
Total return		13.14	%(3)		(41.70	%)		20.61	%		3.73	%		5.24	%		12.32	%
Supplemental data and ratios:
Net assets, end of period	$	1,587,075		$	1,563,786		$	4,783,844		$	5,023,621		$	4,506,947		$	3,944,857
Ratio of expenses to average net assets		1.10	%(4)		1.10	%		1.10	%		1.10	%		1.10	%		1.10	%
Ratio of expenses to average
net assets (before waivers)		1.57	%(4)		1.44	%		1.36	%		1.26	%		1.23	%		1.30	%
Ratio of net investment loss
to average net assets		(0.12	%)(4)		(0.19	%)		(0.31	%)		(0.42	%)		(0.46	%)		(0.68	%)
Ratio of net investment loss
to average net assets (before waivers)		(0.59	%)(4)		(0.53	%)		(0.57	%)		(0.58	%)		(0.59	%)		(0.88	%)
Portfolio turnover rate(5)		33.6	%(3)		74.0	%		72.3	%		78.6	%		77.4	%		77.9	%

(1) Calculated using average shares outstanding during the period.

(2) Amount is less than ($0.005).

(3) Not annualized.

(4) Annualized.

(5) Portfolio turnover is calculated on the basis of the Fund as a whole without distinguishing between the classes of shares issued.

The accompanying notes are an integral part of these financial statements.

Page 26

Baird Funds, Inc.

Notes to the Financial Statements       June 30, 2009 (Unaudited)

1. ORGANIZATION

Baird Funds, Inc. (the “Corporation”) was incorporated on June 9, 2000 as a Wisconsin corporation and is registered as an open-end management investment company under the Investment Company Act of 1940, as amended (the “1940 Act”).  The accompanying financial statements include the Baird LargeCap Fund and the Baird MidCap Fund (each a “Fund” and collectively the “Funds”), two of the eight portfolios comprising the Corporation.  Pursuant to the 1940 Act, the Funds are “diversified” series of the Corporation.  The investment advisor to the Funds is Robert W. Baird & Co. Incorporated (“Baird” or the “Advisor”).

The Baird LargeCap Fund commenced operations with the sale of both Institutional and Investor Class Shares on September 29, 2000. The Baird MidCap Fund commenced operations with the sale of both Institutional and Investor Class Shares on December 29, 2000. The Institutional Class Shares are not subject to a distribution and service (12b-1) fee, while the Investor Class Shares are subject to a distribution and service (12b-1) fee up to 0.25%.

The Baird LargeCap Fund seeks long-term growth of capital through investments in equity securities of large-capitalization companies.  Dividend income is a secondary consideration.

The Baird MidCap Fund seeks long-term growth of capital through investments in equity securities of mid-capitalization companies.

On June 30, 2009, shareholders affiliated with the Advisor held 81% of the Baird LargeCap Fund and 34% of the Baird MidCap Fund.  These shareholders included the Advisor’s participant-directed retirement and deferred compensation plans and the Baird Foundation.

2. SIGNIFICANT ACCOUNTING POLICIES

The following is a summary of significant accounting policies consistently followed by the Funds in the preparation of their financial statements.  These policies are in conformity with accounting principles generally accepted in the United States of America.

a) Investment Valuation – Section 2(a)(41) of the 1940 Act, together with the rules and interpretations of the SEC, require the Funds, in computing NAV, to value their portfolio securities using market quotations when they are “readily available.”  When market quotations are not readily available (e.g., because there is no regular market quotation for such securities, the market for such security is limited, the validity of quotations is questionable or, for debt securities, IDC does not provide a price), the Board of Directors of the Corporation must value the securities at “fair value determined in good faith.”  The Board has delegated such responsibility to the Advisor pursuant to pricing policies and procedures that the Board has adopted and regularly reviews.

In general, the “fair value” of a security means the amount that the Funds might reasonably expect to receive for the security upon its current sale.  Pursuant to Statement of Financial Accounting Standards No. 157 (“SFAS 157), “fair value” means “the price that would be received to sell [a security] in an orderly transaction between market participants at the measurement date.”

Page 27

Baird Funds, Inc.

Notes to the Financial Statements       June 30, 2009 (Unaudited)

2. SIGNIFICANT ACCOUNTING POLICIES (cont.)

Consistent with Section 2(a)(41) of the 1940 Act and SFAS 157, the Funds price their securities as follows:  Common stocks that are listed on a securities exchange (other than NASDAQ) are valued at the last quoted sale price.  Securities traded on NASDAQ are valued at the NASDAQ Official Closing Price.  Price information on listed stocks is taken from the exchange where the security is primarily traded.  Securities that were not traded on the valuation date, as well as stocks that are not listed on an exchange, including NASDAQ, are valued at the average of the current bid and asked price.  Debt securities are valued by an independent pricing service using valuation methods that are designed to represent fair value, such as matrix pricing and other analytical pricing models, market transactions and dealer quotations.  Debt securities purchased with a remaining maturity of 60 days or less are valued at acquisition cost plus or minus any amortized discount or premium.  Investments in mutual funds are valued at their stated net asset value.  Other assets and securities for which no quotations are readily available are valued at fair value as determined in good faith by the Advisor in accordance with procedures approved by the Corporation’s Board of Directors.  In accordance with such procedures, the Advisor may use broker quotes or, if the broker quotes are unavailable or deemed to be unreliable, fair value will be determined by a valuation committee of the Advisor.  In determining fair value, the valuation committee takes into account all relevant factors and available information.  Consequently, the price of the security used by a Fund to calculate its NAV may differ from quoted or published prices for the same security.  Fair value pricing involves subjective judgments and there is no single standard for determining a security’s fair value.  As a result, different mutual funds could reasonably arrive at a different fair value for the same security.  It is possible that the fair value determined for a security is materially different from the value that could be realized upon the sale of that security or from the values that other mutual funds may determine.  In addition, given the volatility and periodic illiquidity experienced in current markets, the prices determined for any individual security on any given day may vary significantly from the amount that can be obtained in an actual sale of that security, and the Funds’ NAV may fluctuate significantly from day to day or from period to period.

In September 2006, the Financial Accounting Standards Board (FASB) issued SFAS 157, “Fair Value Measurements.” SFAS 157 defines fair value, establishes a framework for measuring fair value in accordance with GAAP, and expands disclosure about fair value measurements. SFAS No. 157 is effective for financial statements issued for fiscal years beginning after November 15, 2007.  Management has determined that SFAS 157 had no material impact on the Funds’ financial statements.

In March 2008, Statement of Financial Accounting Standards No. 161, “Disclosures about Derivative Instruments and Hedging Activities” (“SFAS 161”) was issued and is effective for fiscal years beginning after November 15, 2008.  SFAS 161 is intended to improve financial reporting for derivative instruments by requiring enhanced disclosure that enables investors to understand how and why an entity uses derivatives, how derivatives are accounted for, and how derivative instruments affect an entity’s results of operations and financial position.  Management has determined that SFAS 161 had no material impact on the Funds’ financial statements because the Funds do not maintain any positions in derivative instruments or engage in hedging activities.

In preparing these financial statements, the Company has evaluated events and transactions for potential recognition or disclosure through August 28, 2009, the date the financial statements were available to be issued.

Page 28

Baird Funds, Inc.

Notes to the Financial Statements       June 30, 2009 (Unaudited)

2. SIGNIFICANT ACCOUNTING POLICIES (cont.)

b) Foreign Securities – Foreign securities are defined as securities issued by companies that are organized outside the United States.  Investing in securities of foreign companies and foreign governments involves special risks and considerations not typically associated with investing in U.S. companies and the U.S. government.  These risks include revaluation of currencies and future adverse political and economic developments.  Moreover, securities of many foreign companies and foreign governments and their markets may be less liquid and their prices more volatile than those of securities of comparable U.S. companies and the U.S. government.  Occasionally, events that affect those values and exchange rates may occur after the close of the exchange on which such securities are traded.  If such events materially affect the value of a Fund’s securities, these securities may be valued at their fair value pursuant to procedures adopted by the Board of Directors.  All the foreign securities owned by the Funds as of June 30, 2009 are traded on the New York Stock Exchange or NASDAQ.

c) Federal Income Taxes – The Funds intend to continue to qualify as regulated investment companies as provided in subchapter M of the Internal Revenue Code and to distribute substantially all of their taxable income to their shareholders in a manner which results in no tax cost to the Funds.  Therefore, no federal income or excise tax provision is recorded.

Effective June 29, 2007, the Funds adopted Financial Accounting Standards Board (FASB) Interpretation No. 48 (FIN 48), “Accounting for Uncertainty in Income Taxes,” a clarification of FASB Statement No. 109, “Accounting for Income Taxes.” FIN 48 establishes financial reporting rules regarding recognition and measurement of tax positions taken or expected to be taken on a tax return. Management has determined that FIN 48 has not resulted in any liability to the Funds.

d) Distributions to Shareholders – Dividends from net investment income, if any, are declared and paid annually.  Distributions of net realized gains, if any, are declared and paid at least annually.

e) Allocation of Income and Expenses – Each Fund is charged for those expenses directly attributable to it.  Expenses directly attributable to a class of shares, such as Rule 12b-1 distribution fees, are charged to that class of shares.  Income, expenses, and realized and unrealized gains and losses are allocated to the classes based on their respective net assets.  Expenses that are not directly attributable to a Fund are allocated among the series of the Corporation in proportion to their assets.

f) Use of Estimates – The preparation of financial statements in conformity with accounting principles generally accepted in the United States requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period.  Actual results could differ from those estimates.

Page 29

Baird Funds, Inc.

Notes to the Financial Statements       June 30, 2009 (Unaudited)

2. SIGNIFICANT ACCOUNTING POLICIES (cont.)

g) Other – Investment and shareholder transactions are recorded on trade date.  The Funds determine the gain or loss realized from investment transactions by comparing the original cost of the security lot sold with the net sales proceeds.  Dividend income is recognized on the ex-dividend date and interest income is recognized on an accrual basis.  Accounting principles generally accepted in the United States require that permanent financial reporting and tax differences be reclassified in the capital accounts.

h) Guarantees and Indemnifications – In the normal course of business, the Funds enter into contracts with service providers that contain general indemnification clauses.  The Funds’ maximum exposure under these arrangements is unknown and this would involve future claims against the Funds that have not yet occurred.  Based on experience, the Funds would expect the risk of loss to be remote.

3. CAPITAL SHARE TRANSACTIONS

The following table summarizes the capital share transactions of each Fund for the past two fiscal periods:

BAIRD LARGECAP FUND

	Six Months Ended							Six Months Ended
	June 30, 2009							June 30, 2009
Institutional Class Shares	Shares			Amount			Investor Class Shares	Shares			Amount
Shares sold		227,815		$	1,267,139		Shares sold		962		$	5,000
Shares redeemed		(419,318	)		(2,486,962	)	Shares redeemed		(663	)		(3,856	)
Net decrease		(191,503	)	$	(1,219,823	)	Net increase		299		$	1,144
Shares Outstanding:							Shares Outstanding:
Beginning of period		2,924,270					Beginning of period		46,755
End of period		2,732,767					End of period		47,054

	Year Ended							Year Ended
	December 31, 2008							December 31, 2008
Institutional Class Shares	Shares			Amount			Investor Class Shares	Shares			Amount
Shares sold		395,392		$	2,875,596		Shares sold		3,893		$	30,992
Shares issued to							Shares issued to
shareholders in							shareholders in
reinvestment of							reinvestment of
dividends		14,995			80,523		dividends		—			—
Shares redeemed		(449,499	)		(3,446,338	)	Shares redeemed		(36,862	)		(306,565	)
Net decrease		(39,112	)	$	(490,219	)	Net decrease		(32,969	)	$	(275,573	)
Shares Outstanding:							Shares Outstanding:
Beginning of period		2,963,382					Beginning of period		79,724
End of period		2,924,270					End of period		46,755

Page 30

Baird Funds, Inc.

Notes to the Financial Statements       June 30, 2009 (Unaudited)

3. CAPITAL SHARE TRANSACTIONS (cont.)

BAIRD MIDCAP FUND

	Six Months Ended							Six Months Ended
	June 30, 2009							June 30, 2009
Institutional Class Shares	Shares			Amount			Investor Class Shares	Shares			Amount
Shares sold		166,827		$	924,214		Shares sold		15,228		$	74,224
Shares redeemed		(176,350	)		(1,014,465	)	Shares redeemed		(44,063	)		(237,192	)
Net decrease		(9,523	)	$	(90,251	)	Net decrease		(28,835	)	$	(162,968	)
Shares Outstanding:							Shares Outstanding:
Beginning of period		3,228,019					Beginning of period		284,906
End of period		3,218,496					End of period		256,071

	Year Ended							Year Ended
	December 31, 2008							December 31, 2008
Institutional Class Shares	Shares			Amount			Investor Class Shares	Shares			Amount
Shares sold		376,048		$	2,765,434		Shares sold		41,456		$	316,588
Shares issued to							Shares issued to
shareholders in							shareholders in
reinvestment of							reinvestment of
distributions		2,660			14,311		dividends		—			—
Shares redeemed		(955,817	)		(7,643,087	)	Shares redeemed		(265,423	)		(1,884,193	)
Net decrease		(577,109	)	$	(4,863,342	)	Net decrease		(223,967	)	$	(1,567,605	)
Shares Outstanding:							Shares Outstanding:
Beginning of period		3,805,128					Beginning of period		508,873
End of period		3,228,019					End of period		284,906

Page 31

Baird Funds, Inc.

Notes to the Financial Statements       June 30, 2009 (Unaudited)

4. INVESTMENT TRANSACTIONS AND INCOME TAX INFORMATION

During the six months ended June 30, 2009, purchases and sales of investment securities (excluding short-term investments) were as follows:

	Baird		Baird
	LargeCap Fund		MidCap Fund
Purchases:	$	5,496,160	$	6,573,165
Sales:	$	6,477,622	$	6,706,679

At December 31, 2008, accumulated earnings/losses on a tax basis were as follows:

	Baird			Baird
	LargeCap			MidCap
	Fund			Fund
Cost of Investments	$	27,362,405		$	30,288,972
Gross unrealized appreciation	$	913,224		$	1,571,476
Gross unrealized depreciation		(4,813,846	)		(5,645,446	)
Net unrealized depreciation	$	(3,900,622	)	$	(4,073,970	)
Undistributed ordinary income*	$	9,629		$	22,225
Undistributed long-term capital gain		—			—
Total distributable earnings	$	9,629		$	22,225
Other accumulated losses	$	(3,963,137	)	$	(3,126,388	)
Total accumulated losses	$	(7,854,130	)	$	(7,178,133	)

* Undistributed ordinary income includes income from securities lending placed in reserve (see Note 6).

Undistributed income or net realized gains for financial statement purposes may differ from amounts recognized for federal income tax purposes due to differences in the recognition and characterization of income, expense and capital gain items.

Under the current tax law, capital losses realized after October 31 may be deferred and treated as occurring on the first day of the following fiscal year.  For the year ended December 31, 2008, the Baird LargeCap Fund and the Baird MidCap Fund elected to defer capital losses occurring between November 1, 2008 and December 31, 2008 in the amount of $1,651,089 and $2,034,254, respectively.

At December 31, 2008, the Baird LargeCap Fund had accumulated net realized capital loss carryovers of $929,167 that expire in 2016, $1,167,011 that expire in 2012 and $215,870 that expire in 2011.  At December 31, 2008, the Baird MidCap Fund had accumulated net realized capital loss carryovers of $1,092,134 that expire in 2016.  To the extent the Funds realize future net capital gains, taxable distributions to shareholders will be offset by any unused capital loss carryovers.  During the year ended December 31, 2008, the Funds did not utilize any capital loss carryovers from previous years.

During the six months ended June 30, 2009, the Funds have not made any capital gain distributions or income dividends.

Page 32

Baird Funds, Inc.

Notes to the Financial Statements       June 30, 2009 (Unaudited)

4. INVESTMENT TRANSACTIONS AND INCOME TAX INFORMATION (cont.)

During the year ended December 31, 2008, the Funds paid the following dividends:

	Ordinary Income Dividends	Net Long-Term Capital Gains
Baird LargeCap Fund	$81,425	—
Baird MidCap Fund	$14,588	—

5. INVESTMENT ADVISORY AND OTHER AGREEMENTS

The Funds have entered into an Investment Advisory Agreement with Baird for the provision of investment advisory services. Pursuant to the Investment Advisory Agreement, the Advisor is entitled to receive a fee, calculated daily and payable monthly, at the annual rate of 0.65% for the Baird LargeCap Fund and 0.75% for the Baird MidCap Fund as applied to the respective Fund’s average daily net assets.  Certain officers of the Advisor are also officers of the Funds.

For the year ended December 31, 2009 and through April 30, 2010, the Advisor has contractually agreed to waive its investment advisory fee and/or reimburse the Funds’ operating expenses (exclusive of brokerage, taxes, and extraordinary expenses) to the extent necessary to ensure that each Fund’s annual operating expenses do not exceed the following percentages of average daily net assets:

	Institutional Class Shares	Investor Class Shares
Baird LargeCap Fund	0.75%	1.00%
Baird MidCap Fund	0.85%	1.10%

To the extent that the Advisor reimburses or absorbs fees and expenses, it may seek payment of such amounts for three years after the year in which expenses were reimbursed or absorbed.  A Fund will make no such payment, however, if its total annual operating expenses exceed the expense limits in effect at the time the expenses were reimbursed or at the time these payments are proposed.

	Six Months Ended	Fiscal Period Ended December 31,
	June 30,
	2009	2008	2007	2006
Reimbursed / Absorbed Expenses Subject
to Recovery by Advisor Until:	2012	2011	2010	2009
Baird LargeCap Fund	$49,458	$  99,829	$100,379	$  98,794
Baird MidCap Fund	$46,547	$101,968	$103,600	$117,213

U.S. Bancorp Fund Services, LLC serves as transfer agent, administrator, and accounting services agent for the Funds.  U.S. Bank, N.A. serves as custodian for the Funds.

Robert W. Baird & Co. Incorporated (the “Distributor”) is the sole distributor of the Funds pursuant to a distribution agreement.

No commissions were earned by the Distributor for services rendered as a registered broker-dealer in securities transactions for the Baird LargeCap Fund and Baird MidCap Fund for the six months ended June 30, 2009.

Page 33

Baird Funds, Inc.

Notes to the Financial Statements       June 30, 2009 (Unaudited)

6. SECURITIES LENDING

Each Fund may lend up to one-third of its total assets (including such loans) to borrowers under terms of participation in a securities lending program administered by FAF Advisors, Inc., an affiliate of the Funds’ custodian, transfer agent and administrator.  The securities lending agreement requires that loans are collateralized at all times in an amount equal to at least 102% of the market value of any loaned securities at the time of the loan, plus accrued interest.

The Funds receive compensation in the form of fees and earn interest on the cash collateral.  The amount of fees depends on a number of factors including the type of security and length of the loan.  Each Fund continues to receive interest payments or dividends on the securities loaned during the borrowing period.  Each Fund has the right under the terms of the securities lending agreement to recall the securities from the borrower on demand.

As of June 30, 2009, the Baird LargeCap and Baird MidCap Funds had loaned securities that were collateralized by cash equivalents.  The cash collateral is invested by the custodian in accordance with approved investment guidelines.  Those guidelines require the cash collateral to be invested in readily marketable, high quality, short-term obligations; however, such investments are subject to risk of payment delays or default on the part of the issuer or counterparty or otherwise may not generate sufficient interest to support the costs associated with securities lending.  A Fund could also experience delays in recovering its securities and possible loss of income or value if the borrower fails to return the borrowed securities, although the Funds are indemnified from this risk by contract with the securities lending agent.

As of June 30, 2009, the market value of the securities on loan and payable on collateral due to broker were as follows:

	Market Value of	Payable on Collateral
	Securities on Loan	due to Broker
Baird LargeCap Fund	$6,086,448	$6,533,431
Baird MidCap Fund	$7,642,837	$8,238,156

The Funds receive cash as collateral in return for securities lent as part of a securities lending program.  The collateral is invested in short-term securities including the Mount Vernon Prime Portfolio (a securities lending trust subject to Rule 2a-7 under the 1940 Act), other money market funds, certificates of deposit, commercial paper, corporate notes, government agency securities and repurchase agreements.  The schedules of investments for the Funds include the particular cash collateral holdings as of June 30, 2009.  The Funds intend to invest all of the collateral in the Mount Vernon Prime Portfolio once their existing cash collateral holdings mature or are liquidated or otherwise paid down.  Currently, the Funds hold two cash collateral investments that are priced at fair value by the Valuation Committee of the Advisor: an interest in Atlantic East Funding Trust, LLC and shares of the Reserve Primary Fund.  The interest in Atlantic East Funding Trust, LLC is priced at par based on the underlying market value of the securities owned by the Atlantic East Funding Trust, LLC, amounts payable under an agreement from the Funds’ transfer agent and administrator to cover losses realized by the Funds on this investment (up to a certain amount), and a securities lending income reserve.  This price for the Funds' interest in Atlantic East Funding Trust, LLC is reflected in the Funds' Schedules of Investments and is included in the Funds' investments, at value in the Funds' Statements of Assets and Liabilities.  The Funds deposited their securities lending income into a reserve account from July 2008 through January 2009, which reserve may be used to cover additional losses by the Funds on their interest in Atlantic East Funding Trust, LLC after applying amounts payable from the Funds’ transfer agent and administrator.  As a result of these securities lending income reserves, the Funds did not recognize income from their securities lending activity for financial reporting purposes from July 2008 through January 2009

Page 34

Baird Funds, Inc.

Notes to the Financial Statements       June 30, 2009 (Unaudited)

6. SECURITIES LENDING (cont.)

but are required to recognize and distribute such income for tax purposes.  The amounts in the securities lending reserve at June 30, 2009 are $14,118 for the Baird LargeCap Fund and $36,183 for the Baird MidCap Fund.  These amounts are not included as income from securities lending or as investment income on the Funds' Statements of Operations.  Upon the liquidation of the Funds’ interest in Atlantic East Funding Trust, LLC, any excess securities lending income reserves (after applying the reserves and amounts payable from the Funds’ transfer agent and administrator to cover losses) will then be recognized as income to the Funds.  The Funds discontinued depositing their securities lending income into a reserve in February 2009.  From February 2009 through June 2009, the Funds recognized income from their securities lending activity.  Interest income earned on collateral investments and recognized by the Funds during the six months ended June 30, 2009 for the Baird LargeCap Fund and Baird MidCap Fund was $6,051 and $13,003, respectively.  Shares of the Reserve Primary Fund are priced at $1.00 per share based on the fair value of the shares of that fund plus an agreement to contribute additional amounts to be applied to those shares by the Funds’ transfer agent and administrator.  This price for the Reserve Primary Fund shares is reflected in the Funds' Schedules of Investments and is included in the Funds' investments, at value in the Funds' Statements of Assets and Liabilities.

7. LINE OF CREDIT

The Corporation maintains an uncommitted, senior secured line of credit (“LOC”) with U.S. Bank, N.A. (the “Bank”) to provide the Funds a temporary liquidity source to meet unanticipated redemptions.  Under the terms of the LOC, borrowings for each Fund are limited to one-third of the total assets (including the amount borrowed) of the respective Fund, or as otherwise indicated within the Funds’ agreement with the Bank.  The Bank charges interest at the Bank’s Prime Rate less 1% (weighted average rate of 2.25% for the six months of 2009).  For the six months ended June 30, 2009, the Baird LargeCap Fund and Baird MidCap Fund did not borrow on the LOC.

8. DISTRIBUTION AND SHAREHOLDER SERVICE PLAN

The Funds have adopted a distribution and shareholder service plan (the “Plan”) pursuant to Rule 12b-1 under the 1940 Act.  The Plan allows the Funds to compensate the Distributor for the costs incurred in distributing the Funds’ Investor Class Shares, including amounts paid to brokers or dealers, at an annual rate not to exceed 0.25% of the average daily net assets of the Funds’ Investor Class Shares.  The Baird LargeCap Fund and Baird MidCap Fund incurred $335 and $1,862, respectively, in fees pursuant to the Plan during the six months ended June 30, 2009.

9. SUBSEQUENT EVENT

In July 2009, FAF Advisors, Inc. and its affiliate, the Bank, returned to the Funds fees they earned in respect of the Funds’ securities lending activity from December 3, 2008 through May 21, 2009 because during that period the Bank may have been deemed to be indirectly affiliated with the Funds.  Amounts returned to the Funds are approximately $4,410 for the Baird Large Cap Fund and $9,047 for the Baird MidCap Fund.  The Funds are recognizing as income the securities lending fees returned to them.  The additional income being recognized by the Funds will be included in the Funds’ year-end income distributions.

Page 35

Additional Information

Proxy Voting

A description of the policies and procedures that the Funds use to determine how to vote proxies relating to portfolio securities is available without charge, upon request, by calling toll free, 1-866-44BAIRD, or by accessing the Funds’ website at www.bairdfunds.com; and by accessing the SEC’s website at www.sec.gov.

Each Fund’s proxy voting record for the most recent 12-month period ended June 30 is available without charge, upon request, by calling toll free, 1-866-44BAIRD, or by accessing the Funds’ website at www.bairdfunds.com; and by accessing the SEC’s website at www.sec.gov.

Portfolio Holdings Disclosure

The Funds file a complete schedule of portfolio holdings with the SEC for the first and third quarters of each fiscal year on Form N-Q.  The Funds’ Forms N-Q are available on the SEC website at www.sec.gov and may be reviewed and copied at the SEC’s Public Reference Room in Washington, D.C.  Information on the operation of the Public Reference Room may be obtained by calling 1-800-732-0330.  The Funds’ Forms N-Q may also be obtained by calling toll-free 1-866-44BAIRD.

Page 36

(This Page Intentionally Left Blank.)

Baird Funds, Inc.

c/o U.S. Bancorp Fund Services, LLC

P.O. Box 701

Milwaukee, WI 53201-0701

1-866-44BAIRD

Board of Directors

G. Frederick Kasten, Jr. (Chairman)

John W. Feldt

Frederick P. Stratton, Jr.

Cory L. Nettles

Marlyn J. Spear

Investment Advisor and Distributor

Robert W. Baird & Co. Incorporated

777 East Wisconsin Avenue

Milwaukee, WI 53202

Administrator and Transfer Agent

U.S. Bancorp Fund Services, LLC

P.O. Box 701

615 East Michigan Street

Milwaukee, WI 53202

Custodian

U.S. Bank, N.A.

1555 N. RiverCenter Drive, Suite 302

Milwaukee, WI 53212

Legal Counsel

Godfrey & Kahn, S.C.

780 North Water Street

Milwaukee, WI 53202

Independent Registered Public Accounting Firm

Grant Thornton LLP

175 West Jackson Boulevard, 13th Floor

Chicago, IL 60604

Semi-Annual Report

June 30, 2009

RiverFront Long-Term Growth Fund

TABLE OF CONTENTS

	Page
RiverFront Long-Term Growth Fund	1
Additional Information on Fund Expenses	9
Statement of Assets and Liabilities	11
Statement of Operations	12
Statement of Changes in Net Assets	13
Financial Highlights	14
Notes to the Financial Statements	16
Additional Information	23

This report has been prepared for shareholders and may be distributed to others only if preceded or accompanied by a current prospectus.

Cautionary Note on Analyses, Opinions and Outlooks:  In this report we offer analyses and opinions on the performance of individual securities, companies, industries, sectors, markets, interest rates and governmental policies, including predictions, forecasts and outlooks regarding possible future events.  These can generally be identified as such because the context of the statements may include such words as “believe,” “should,” “will,” “expects,” “anticipates,” “hopes” and words of similar effect.  These statements reflect the portfolio managers’ good faith beliefs and judgments and involve risks and uncertainties, including the risk that the portfolio managers’ analyses, opinions and outlooks are or will prove to be inaccurate.  It is inherently difficult to correctly assess and explain the performance of particular securities, sectors, markets, interest rate movements, governmental actions or general economic trends and conditions, and many unforeseen factors contribute to the performance of Baird Funds.  Investors are, therefore, cautioned not to place undue reliance on subjective judgments contained in this report.

RiverFront Long-Term Growth Fund

A June 30, 2009 summary of the Fund’s top 10 holdings and asset allocation is shown below.

Top 10 Holdings*			Asset Allocation**
Vanguard Europe Pacific ETF	10.63%
Vanguard Emerging Markets ETF	8.46%
iShares MSCI EAFE Index Fund	4.20%
iShares S&P Latin
American 40 Index Fund	2.92%
iShares S&P SmallCap 600 Index Fund	2.79%
PowerShares DB Commodity
Index Tracking Fund	2.77%
PowerShares DB Agriculture Fund	2.57%
iShares MSCI Emerging Markets Index	2.20%
Vanguard FTSE All World
ex-US Small-Cap Index ETF	2.06%
iShares Dow Jones U.S.
Broker-Dealers Index Fund	1.67%
Net Assets:	$16,896,270
Portfolio Turnover Rate
(not annualized):	32.9%
Number of Equity Holdings:	93
Annualized Portfolio Expense Ratio:***
INSTITUTIONAL CLASS:	0.90%
INVESTOR CLASS:	1.15%	****

* The Fund’s portfolio composition is subject to change and there is no assurance that the Fund will continue to hold any particular security.  Percentages shown relate to the Fund’s total net assets as of June 30, 2009.

** Percentages shown in parentheses may not add up to 100% due to rounding.

*** The Advisor has contractually agreed to limit the Fund’s total annual fund operating expenses to 0.90% of average daily net assets for the Institutional Class shares and 1.15% of average daily net assets for the Investor Class shares, at least through December 31, 2011.

**** Includes 0.25% 12b-1 fee.

Page 1

RiverFront Long-Term Growth Fund

Total Returns(1)

For the Periods Ended June 30, 2009	Six Months	Since Inception(2)
Institutional Class Shares	5.53%	11.66%
Investor Class Shares	5.44%	11.43%
S&P 500® Index(3)	3.16%	-0.28%

(1) Represents actual, non-annualized total returns for the periods ended June 30, 2009.

(2) For the period from October 28, 2008 (commencement of operations) through June 30, 2009.

(3) The S&P 500® is an index of 500 stocks chosen for market size, liquidity and industry grouping, among other factors.  The S&P 500® is designed to be a leading indicator of U.S. equities and is meant to reflect the risk/return characteristics of the large cap universe. Companies included in the index are selected by the S&P Index Committee, a team of analysts and economists at Standard & Poor’s.  The S&P 500® is a market value weighted index – each stock’s weight in the index is proportionate to its market value.  A direct investment in an index is not possible.

The returns shown in the table above reflect reinvestment of dividends and/or capital gains distributions in additional shares.  The returns do not reflect the deduction of taxes that a shareholder would pay on Fund distributions or the redemption of Fund shares.

Past performance does not guarantee future results.  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.

For information about the performance of the Fund as of the most recent month-end, please call 1-866-44BAIRD or visit www.bairdfunds.com.  Mutual fund performance changes over time and current performance may be lower or higher than that stated.

Page 2

RiverFront Long-Term Growth Fund

Schedule of Investments       June 30, 2009 (Unaudited)

Shares			Value
COMMON STOCKS – 39.6%
Aerospace & Defense – 1.7%
	1,528	L-3 Communications
		Holdings, Inc.	$	106,013
	760	Lockheed Martin
		Corporation		61,294
	2,263	United Technologies
		Corporation		117,585
				284,892
Beverages – 0.9%
	3,063	The Coca-Cola Company		146,993
Capital Markets – 0.7%
	7,029	Invesco Limited f		125,257
Chemicals – 1.0%
	1,193	Praxair, Inc.		84,787
	3,544	Sensient Technologies
		Corporation		79,988
				164,775
Commercial Banks – 0.5%
	1,852	Cullen/Frost Bankers, Inc.		85,414
Commercial Services & Supplies – 0.4%
	1,707	Manpower Inc.		72,274
Communications Equipment – 1.9%
	9,173	Cisco Systems, Inc.*		170,985
	3,155	Harris Corporation		89,476
	2,812	Polycom, Inc.*		56,999
				317,460
Computers & Peripherals – 2.5%
	1,509	Apple Inc.*		214,927
	1,828	Hewlett-Packard Company		70,652
	1,403	International
		Business Machines
		Corporation (IBM)		146,501
				432,080
Construction & Engineering – 0.7%
	2,230	Fluor Corporation		114,377
Containers & Packaging – 0.9%
	3,243	Ball Corporation		146,454
Distributors – 0.3%
	1,834	WESCO
		International, Inc.*		45,923
Diversified Financial Services – 0.6%
	4,895	NASDAQ OMX
		Group, Inc.*		104,312
Diversified Telecommunication Services – 0.3%
	1,749	Verizon
		Communications Inc.		53,747
Electric Utilities – 0.3%
	4,758	TECO Energy, Inc.		56,763
Energy Equipment & Services – 1.9%
	3,908	Hornbeck Offshore
		Services, Inc.*		83,592
	1,686	National-Oilwell Varco Inc.*		55,065
	2,960	Patterson-UTI Energy, Inc.		38,065
	1,288	Schlumberger Limited f		69,694
	4,563	Superior Energy
		Services, Inc.*		78,803
				325,219
Food & Staples Retailing – 1.5%
	2,413	CVS Caremark Corporation		76,902
	3,697	Wal-Mart Stores, Inc.		179,083
				255,985
Food Products – 1.0%
	3,917	The Hain Celestial
		Group Inc.*		61,144
	2,830	H.J. Heinz Company		101,031
				162,175
Health Care Providers & Services – 3.4%
	2,476	DaVita, Inc.*		122,463
	1,931	Express Scripts, Inc.*		132,756
	2,317	Henry Schein, Inc.*		111,100
	979	Johnson & Johnson		55,607

The accompanying notes are an integral part of these financial statements.

Page 3

RiverFront Long-Term Growth Fund

Schedule of Investments       June 30, 2009 (Unaudited)

Shares			Value
COMMON STOCKS – 39.6% (cont.)
Health Care Providers & Services – 3.4% (cont.)
	2,165	Laboratory Corporation
		of America Holdings*	$	146,766
				568,692
Hotels, Restaurants & Leisure – 1.2%
	4,136	Jack in the Box Inc.*		92,853
	3,770	Penn National
		Gaming, Inc.*		109,745
				202,598
Household Products – 1.5%
	2,394	Church & Dwight Co., Inc.		130,018
	2,465	The Procter &
		Gamble Company		125,962
				255,980
Insurance – 1.9%
	1,936	Aflac, Inc.		60,190
	6,368	HCC Insurance
		Holdings, Inc.		152,896
	7,632	The Progressive
		Corporation*		115,319
				328,405
IT Services – 0.8%
	3,049	Fiserv, Inc.*		139,339
Leisure Equipment & Products – 0.7%
	4,639	Hasbro, Inc.		112,449
Machinery – 1.4%
	3,119	Dover Corporation		103,208
	3,462	Illinois Tool Works Inc.		129,271
				232,479
Multiline Retail – 0.7%
	2,814	Dollar Tree, Inc.*		118,469
Multimedia – 0.5%
	1,636	Factset Research
		Systems Inc.		81,587
Multi-Utilities & Unregulated Power – 1.1%
	3,152	Dominion Resources, Inc.		105,340
	4,202	MDU Resources
		Group, Inc.		79,712
				185,052
Oil & Gas – 4.1%
	1,296	Chevron Corporation		85,860
	2,066	Cimarex Energy Co.		58,550
	2,272	Exxon Mobil Corporation		158,836
	4,467	Forest Oil Corporation*		66,648
	4,245	Marathon Oil Corporation		127,902
	3,716	ONEOK, Inc.		109,585
	2,180	XTO Energy, Inc.		83,145
				690,526
Pharmaceuticals – 1.7%
	5,082	Bristol-Myers
		Squibb Company		103,216
	5,648	Endo Pharmaceuticals
		Holdings Inc.*		101,212
	1,960	Wyeth		88,964
				293,392
Real Estate Investment Trusts – 0.5%
	3,929	Highwoods Properties, Inc.		87,892
Software – 0.6%
	4,647	Amdocs Limited* f		99,678
Specialty Retail – 1.9%
	3,525	Best Buy Co., Inc.		118,052
	2,963	Lowe’s Companies, Inc.		57,512
	6,521	PetSmart, Inc.		139,941
				315,505
Tobacco – 0.5%
	2,146	Philip Morris
		International Inc.		93,609
		Total Common Stocks
		(Cost $6,330,485)		6,699,752

The accompanying notes are an integral part of these financial statements.

Page 4

RiverFront Long-Term Growth Fund

Schedule of Investments       June 30, 2009 (Unaudited)

Shares			Value
EXCHANGE-TRADED FUNDS – 54.6%
Basic Materials – 0.9%
	3,556	iShares Dow Jones
		U.S. Basic Materials
		Sector Index Fund	$	154,295
Commodity – 8.3%
	8,044	iPath Dow Jones-UBS
		Natural Gas Total
		Return Sub-Index ETN*		134,335
	17,085	PowerShares DB
		Agriculture Fund		434,813
	10,085	PowerShares DB
		Base Metals Fund		151,981
	20,675	PowerShares DB
		Commodity Index
		Tracking Fund		467,669
	2,411	SPDR Gold Trust*		219,835
				1,408,633
Energy – 0.9%
	4,731	SPDR S&P Oil &
		Gas Exploration &
		Production ETF		150,067
Financial Services – 1.7%
	11,003	iShares Dow Jones
		U.S. Broker-Dealers
		Index Fund		281,677
Health & Biotechnology – 2.5%
	3,960	iShares U.S. Dow Jones
		Medical Equipment Index		175,230
	2,234	iShares Dow Jones U.S.
		Healthcare Providers Index		86,232
	3,333	PowerShares Dynamic
		Healthcare Sector Portfolio*		64,827
	2,051	SPDR S&P Biotech ETF		104,006
				430,295
International Equity – 32.8%
	3,686	iShares MSCI All
		Country Asia ex-Japan
		Index Fund		161,373
	6,928	iShares MSCI Canada
		Index Fund		148,398
	15,484	iShares MSCI EAFE
		Index Fund		709,322
	11,546	iShares MSCI Emerging
		Markets Index		372,128
	8,422	iShares MSCI Pacific
		ex-Japan Index Fund		266,725
	14,210	iShares S&P Latin
		American 40 Index Fund		493,655
	14,321	PowerShares
		International Dividend
		Achievers Portfolio		163,832
	44,903	Vanguard Emerging
		Markets ETF		1,428,813
	62,554	Vanguard Europe
		Pacific ETF		1,795,300
				5,539,546
Internet & Telecom – 0.9%
	3,587	Vanguard Information
		Technology Index ETF		152,734
Large Cap – 1.0%
	4,664	PowerShares QQQ		169,676
Mid Cap – 0.3%
	970	iShares Morningstar Mid
		Growth Index Fund		58,530
Small Cap – 4.9%
	10,599	iShares S&P SmallCap
		600 Index Fund		471,338
	5,289	Vanguard FTSE All World
		ex-U.S. Small-Cap ETF*		347,752
				819,090

The accompanying notes are an integral part of these financial statements.

Page 5

RiverFront Long-Term Growth Fund

Schedule of Investments       June 30, 2009 (Unaudited)

Shares			Value
EXCHANGE-TRADED FUNDS – 54.6% (cont.)
Technology – 0.4%
	1,745	iShares S&P North
		American Technology-
		Software Index Fund*	$	67,200
		Total Exchange-
		Traded Funds
		(Cost $8,216,171)		9,231,743
SHORT-TERM INVESTMENTS – 4.7%
Money Market Fund – 4.7%
	786,492	Fidelity Institutional
		Government Portfolio		786,492
		Total Short-Term
		Investments
		(Cost $786,492)		786,492
		Total Investments
		(Cost $15,333,148) –
		98.9%		16,717,987
		Other Assets in Excess
		of Liabilities – 1.1%		178,283
		TOTAL NET
		ASSETS – 100.0%	$	16,896,270

* Non-Income Producing

f Foreign Security

The accompanying notes are an integral part of these financial statements.

Page 6

RiverFront Long-Term Growth Fund

Schedule of Investments       June 30, 2009 (Unaudited)

SFAS 157 – Summary of Fair Value Exposure at June 30, 2009 (Unaudited)

As adopted by the Fund, the Financial Accounting Standards Board issued Statement of Financial Accounting Standards No. 157, “Fair Value Measurements” (“SFAS 157”) defines fair value, establishes a framework for measuring fair value in generally accepted accounting principles (GAAP), and expands disclosures about fair value measurements.  Under SFAS 157, various inputs are used in determining the value of the Fund’s investments.  These inputs are summarized into three broad levels and described below:

Level 1 –	Quoted prices in active markets for identical securities.
Level 2 –	Other significant observable inputs (including quoted prices for similar securities, quoted prices in inactive markets, interest rates, yield curves, prepayment speeds, credit risk, default rates, inputs corroborated by observable market data, etc.)
Level 3 –	Significant unobservable inputs (including the Fund’s own assumptions about the assumptions that market participants would use in pricing the security)

The inputs or methodology used for valuing securities are not necessarily an indication of the risk associated with investing in those securities.

The following is a summary of the inputs used to value the Fund’s investments as of June 30, 2009:

	Level 1		Level 2		Level 3		Total
Equity
Common Stocks
Aerospace & Defense	$	284,892	$	—	$	—	$	284,892
Beverages		146,993		—		—		146,993
Capital Markets		125,257		—		—		125,257
Chemicals		164,775		—		—		164,775
Commercial Banks		85,414		—		—		85,414
Commercial Services & Supplies		72,274		—		—		72,274
Communications Equipment		317,460		—		—		317,460
Computers & Peripherals		432,080		—		—		432,080
Construction & Engineering		114,377		—		—		114,377
Containers & Packaging		146,454		—		—		146,454
Distributors		45,923		—		—		45,923
Diversified Financial Services		104,312		—		—		104,312
Diversified Telecommunication Services		53,747		—		—		53,747
Electric Utilities		56,763		—		—		56,763
Energy Equipment & Services		325,219		—		—		325,219
Food & Staples Retailing		255,985		—		—		255,985
Food Products		162,175		—		—		162,175

Page 7

RiverFront Long-Term Growth Fund

Schedule of Investments       June 30, 2009 (Unaudited)

	Level 1		Level 2		Level 3		Total
Health Care Providers & Services		568,692		—		—		568,692
Hotels, Restaurants & Leisure		202,598		—		—		202,598
Household Products		255,980		—		—		255,980
Insurance		328,405		—		—		328,405
IT Services		139,339		—		—		139,339
Leisure Equipment & Products		112,449		—		—		112,449
Machinery		232,479		—		—		232,479
Multiline Retail		118,469		—		—		118,469
Multimedia		81,587		—		—		81,587
Multi-Utilities & Unregulated Power		185,052		—		—		185,052
Oil & Gas		690,526		—		—		690,526
Pharmaceuticals		293,392		—		—		293,392
Real Estate		87,892		—		—		87,892
Software		99,678		—		—		99,678
Specialty Retail		315,505		—		—		315,505
Tobacco		93,609		—		—		93,609
Total Common Stocks		6,699,752		—		—		6,699,752
Exchange-Traded Funds
Basic Materials		154,295		—		—		154,295
Commodity		1,408,633		—		—		1,408,633
Energy		150,067		—		—		150,067
Financial Services		281,677		—		—		281,677
Health & Biotechnology		430,295		—		—		430,295
International Equity		5,539,546		—		—		5,539,546
Internet & Telecom		152,734		—		—		152,734
Large Cap		169,676		—		—		169,676
Mid Cap		58,530		—		—		58,530
Small Cap		819,090		—		—		819,090
Technology		67,200		—		—		67,200
Total Exchange-Traded Funds		9,231,743		—		—		9,231,743
Total Equity		15,931,495		—		—		15,931,495
Short-Term Investments
Money Market Mutual Funds		786,492		—		—		786,492
Total Short-Term Investments		786,492		—		—		786,492
Total Investments in Securities	$	16,717,987	$	—	$	—	$	16,717,987

Page 8

RiverFront Long-Term Growth Fund

Additional Information on Fund Expenses       June 30, 2009 (Unaudited)

Example

As a shareholder of a mutual fund, you incur two types of costs: (1) transaction costs, which may include sales charges (loads) on purchase payments, reinvested dividends, or other distributions; redemption fees; and exchange fees; and (2) ongoing costs, such as management fees; distribution and/or service (12b-1) fees; and other fund expenses.  Although the Fund does not charge any sales loads, redemption fees, or other transaction fees, you will be assessed fees for outgoing wire transfers, returned checks and stop payment orders at prevailing rates charged by U.S. Bancorp Fund Services, LLC, the Fund’s transfer agent.  If you request that a redemption be made by wire transfer, currently the Fund’s transfer agent charges a $15.00 fee.

This Example is intended to help you understand your ongoing costs (in dollars) of investing in the Fund and to compare these costs with the ongoing costs of investing in other mutual funds.  The Example is based on an investment of $1,000 invested at the beginning of the period and held for the entire period (1/1/09 – 6/30/09).

Actual Expenses

The third and fourth columns of the following table provide information about account values based on actual returns and actual expenses.  You may use the information in these columns, together with the amount you invested, to estimate the expenses that you paid over the period. Simply divide your account value by $1,000 (for example, an $8,600 account value divided by $1,000 – 8.6), then multiply the result by the number in the fourth column entitled “Expenses Paid During Period’’ to estimate the expenses you paid on your account during this period.

Hypothetical Example for Comparison Purposes

The fifth and sixth columns of the following table provide information about hypothetical account values and hypothetical expenses based on the Fund’s actual expense ratios and an assumed rate of return of 5% per year before expenses, which is not the Fund’s actual return. The hypothetical account values and expenses may not be used to estimate the actual ending account balance or expenses you paid for the period. You may use this information to compare the ongoing costs of investing in the Fund and other mutual funds. To do so, compare this 5% hypothetical example with the 5% hypothetical examples that appear in the shareholder reports of the other mutual funds.  Please note that the expenses shown in the table are meant to highlight your ongoing costs only and do not reflect any transactional costs.  Therefore, the sixth column of the table (entitled “Expenses Paid During Period”) is useful in comparing ongoing costs only, and will not help you determine the relative total costs of owning different mutual funds. In addition, if these transactional costs were included, your costs could have been higher.

Page 9

RiverFront Long-Term Growth Fund

Additional Information on Fund Expenses       June 30, 2009 (Unaudited)

Actual vs. Hypothetical Returns

For the Six Months Ended June 30, 2009

					Hypothetical (5% return
			Actual		before expenses)
	Fund’s	Beginning	Ending	Expenses	Ending	Expenses
	Annualized	Account	Account	Paid	Account	Paid
	Expense	Value	Value	During	Value	During
	Ratio(1)	1/1/09	6/30/09	Period(1)	6/30/09	Period(1)
RiverFront Long-Term
Growth Fund
Institutional Class	0.90%	$1,000.00	$1,055.30	$4.59	$1,020.33	$4.51
Investor Class	1.15%	$1,000.00	$1,054.40	$5.86	$1,019.09	$5.76

(1) Expenses are equal to the Fund’s annualized expense ratio multiplied by the average account value over the period, multiplied by 181 days and divided by 365 to reflect the one-half year period.

Page 10

RiverFront Long-Term Growth Fund

Statement of Assets and Liabilities       June 30, 2009 (Unaudited)

ASSETS:
Investments, at value	$	16,717,987
(cost $15,333,148)
Cash		1,878
Dividends receivable		6,751
Interest receivable		239
Receivable for investments sold		77,672
Receivable for fund shares sold		259,800
Other assets		8,912
Total assets		17,073,239
LIABILITIES:
Payable to Advisor and Distributor		242
Payable for securities purchased		154,890
Payable for fund shares repurchased		4
Accrued expenses and other liabilities		21,833
Total liabilities		176,969
NET ASSETS	$	16,896,270
NET ASSETS CONSIST OF:
Capital stock	$	15,873,202
Accumulated undistributed net investment income		45,040
Accumulated net realized loss on investments sold		(406,811	)
Net unrealized appreciation on investments		1,384,839
NET ASSETS	$	16,896,270
INSTITUTIONAL CLASS SHARES
Net Assets	$	13,881,714
Shares outstanding
($0.01 par value, unlimited shares authorized)		1,253,997
Net asset value, offering and redemption price per share	$	11.07
INVESTOR CLASS SHARES
Net Assets	$	3,014,556
Shares outstanding
($0.01 par value, unlimited shares authorized)		272,837
Net asset value, offering and redemption price per share	$	11.05

The accompanying notes are an integral part of these financial statements.

Page 11

RiverFront Long-Term Growth Fund

Statement of Operations       Six Months Ended June 30, 2009 (Unaudited)

INVESTMENT INCOME:
Dividends	$	80,230
Interest		2,443
Other income		9,813
Total investment income		92,486
EXPENSES:
Investment advisory fees		35,224
Administration fees		1,343
Shareholder servicing fees		7,648
Fund accounting fees		1,150
Professional fees		14,731
Federal and state registration		7,220
Directors fees		13,044
Custody fees		11,574
Reports to shareholders		5,253
Distribution fees – Investor Class Shares (Note 7)		1,356
Miscellaneous expenses		44
Total expenses		98,587
Expense reimbursement by Advisor (Note 5)		(48,459	)
Total expenses		50,128
NET INVESTMENT INCOME		42,358
REALIZED AND UNREALIZED GAIN/LOSS ON INVESTMENTS:
Net realized loss on investments		(311,933	)
Change in unrealized appreciation/depreciation on investments		1,249,632
Net realized and unrealized gain on investments		937,699
NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS	$	980,057

The accompanying notes are an integral part of these financial statements.

Page 12

RiverFront Long-Term Growth Fund

Statement of Changes in Net Assets

	Six Months Ended			October 28, 2008(1)
	June 30, 2009			through
	(Unaudited)			December 31, 2008
OPERATIONS:
Net investment income	$	42,358		$	65,058
Net realized loss on investments		(311,933	)		(94,878	)
Change in unrealized appreciation/depreciation on investments		1,249,632			135,207
Net increase in net assets resulting from operations		980,057			105,387
CAPITAL SHARE TRANSACTIONS:
Proceeds from shares sold		9,788,703			7,978,984
Shares issued to holders in reinvestments of dividends		—			56,642
Cost of shares redeemed		(1,737,195	)		(213,933	)
Net increase in net assets resulting
from capital share transactions		8,051,508			7,821,693
DISTRIBUTIONS TO
INSTITUTIONAL CLASS SHAREHOLDERS:
From net investment income		—			(59,302	)
DISTRIBUTIONS TO
INVESTOR CLASS SHAREHOLDERS:
From net investment income		—			(3,073	)
TOTAL INCREASE IN NET ASSETS		9,031,565			7,864,705
NET ASSETS:
Beginning of period		7,864,705			—
End of period (including undistributed net investment
income of $45,040 and $2,682, respectively)	$	16,896,270		$	7,864,705

(1) Commencement of operations.

The accompanying notes are an integral part of these financial statements.

Page 13

RiverFront Long-Term Growth Fund

Financial Highlights

	Institutional Class
	Six Months Ended			October 28, 2008(1)
	June 30, 2009			through
	(Unaudited)			December 31, 2008
Per Share Data:
Net asset value, beginning of period	$	10.49		$	10.00
Income from investment operations:
Net investment income(2)		0.04			0.12
Net realized and unrealized gains on investments		0.54			0.46
Total from investment operations		0.58			0.58
Less distributions:
Distributions from net investment income		—			(0.09	)
Net asset value, end of period	$	11.07		$	10.49
Total return		5.53	%(3)		5.81	%(3)
Supplemental data and ratios:
Net assets, end of period	$	13,881,714		$	7,438,725
Ratio of expenses to average net assets		0.90	%(4)		0.90	%(4)
Ratio of expenses to average net assets (before waivers)		1.79	%(4)		4.97	%(4)
Ratio of net investment income to average net assets		0.80	%(4)		7.55	%(4)
Ratio of net investment income to average net assets (before waivers)		(0.09	%)(4)		3.48	%(4)
Portfolio turnover rate(5)		32.9	%(3)		13.3	%(3)

(1) Commencement of operations.

(2) Calculated using average shares outstanding during the period.

(3) Not annualized.

(4) Annualized.

(5) Portfolio turnover is calculated on the basis of the Fund as a whole without distinguishing between the classes of shares issued.

The accompanying notes are an integral part of these financial statements.

Page 14

RiverFront Long-Term Growth Fund

Financial Highlights

	Investor Class
	Six Months Ended			October 28, 2008(1)
	June 30, 2009			through
	(Unaudited)			December 31, 2008
Per Share Data:
Net asset value, beginning of period	$	10.49		$	10.00
Income from investment operations:
Net investment income(2)		0.03			0.12
Net realized and unrealized gains on investments		0.53			0.46
Total from investment operations		0.56			0.58
Less distributions:
Distributions from net investment income		—			(0.09	)
Net asset value, end of period	$	11.05		$	10.49
Total return		5.44	%(3)		5.68	%(3)
Supplemental data and ratios:
Net assets, end of period	$	3,014,556		$	425,980
Ratio of expenses to average net assets		1.15	%(4)		1.15	%(4)
Ratio of expenses to average net assets (before waivers)		2.04	%(4)		5.22	%(4)
Ratio of net investment income to average net assets		0.55	%(4)		7.30	%(4)
Ratio of net investment income to average net assets (before waivers)		(0.34	%)(4)		3.23	%(4)
Portfolio turnover rate(5)		32.9	%(3)		13.3	%(3)

(1) Commencement of operations.

(2) Calculated using average shares outstanding during the period.

(3) Not annualized.

(4) Annualized.

(5) Portfolio turnover is calculated on the basis of the Fund as a whole without distinguishing between the classes of shares issued.

The accompanying notes are an integral part of these financial statements.

Page 15

RiverFront Long-Term Growth Fund

Notes to the Financial Statements       June 30, 2009 (Unaudited)

1. ORGANIZATION

Baird Funds, Inc. (the “Corporation”) was incorporated on June 9, 2000 as a Wisconsin corporation and is registered as an open-end management investment company under the Investment Company Act of 1940, as amended (the “1940 Act”). The accompanying financial statements include the RiverFront Long-Term Growth Fund (“Fund”), one of the eight portfolios comprising the Corporation.  Pursuant to the 1940 Act, the Fund is a “diversified” series of the Corporation.  The investment advisor to the Fund is Robert W. Baird & Co. Incorporated (“Baird” or the “Advisor”). The sub-advisor to the Fund is RiverFront Investment Group, LLC (“RiverFront”).

The Fund commenced operations with the sale of both Institutional and Investor Class Shares on October 28, 2008. The Institutional Class Shares are not subject to a distribution and service (12b-1) fee, while the Investor Class Shares are subject to a distribution and service (12b-1) fee up to 0.25%.

The Fund seeks long-term capital appreciation through investments primarily in equity securities of domestic and foreign companies across varying market capitalization ranges, styles and economic sectors.

On June 30, 2009, the Advisor held 60% of the Fund through the Advisor’s participant-directed retirement and deferred compensation plans.

2. SIGNIFICANT ACCOUNTING POLICIES

The following is a summary of significant accounting policies consistently followed by the Fund in the preparation of its financial statements.  These policies are in conformity with accounting principles generally accepted in the United States of America.

a) Investment Valuation – Section 2(a)(41) of the 1940 Act, together with the rules and interpretations of the SEC, requires the Fund, in computing NAV, to value its portfolio securities using market quotations when they are “readily available.”  When market quotations are not readily available (e.g., because there is no regular market quotation for such securities, the market for such security is limited, the validity of quotations is questionable or, for debt securities, IDC does not provide a price), the Board of Directors of the Corporation must value the securities at “fair value determined in good faith.”  The Board has delegated such responsibility to the Advisor pursuant to pricing policies and procedures that the Board has adopted and regularly reviews.

In general, the “fair value” of a security means the amount that the Fund might reasonably expect to receive for the security upon its current sale.  Pursuant to Statement of Financial Accounting Standards No. 157 (“SFAS 157), “fair value” means “the price that would be received to sell [a security] in an orderly transaction between market participants at the measurement date.”

Consistent with Section 2(a)(41) of the 1940 Act and SFAS 157, the Fund prices its securities as follows:  Common stocks that are listed on a securities exchange (other than NASDAQ) are valued at the last quoted sales price.  Securities traded on NASDAQ are valued at the NASDAQ Official Closing Price.  Price information on listed stocks is taken from the exchange where the security is primarily traded.  Securities that were not traded on the valuation date,  

Page 16

RiverFront Long-Term Growth Fund

Notes to the Financial Statements       June 30, 2009 (Unaudited)

2. SIGNIFICANT ACCOUNTING POLICIES (cont.)

as well as stocks that are not listed on an exchange, including NASDAQ, are valued at the average of the current bid and asked price.  Debt securities are valued by an independent pricing service using valuation methods that are designed to represent fair value, such as matrix pricing and other analytical pricing models, market transactions and dealer quotations.  Debt securities purchased with a remaining maturity of 60 days or less are valued at acquisition cost plus or minus any amortized discount or premium.  Investments in mutual funds are valued at their stated net asset value.  Other assets and securities for which no quotations are readily available are valued at fair value as determined in good faith by the Advisor in accordance with procedures approved by the Corporation’s Board of Directors.  In accordance with such procedures, the Advisor may use broker quotes or, if the broker quotes are unavailable or deemed to be unreliable, fair value will be determined by a valuation committee of the Advisor.  In determining fair value, the valuation committee takes into account all relevant factors and available information.  Consequently, the price of the security used by the Fund to calculate its NAV may differ from quoted or published prices for the same security.  Fair value pricing involves subjective judgments and there is no single standard for determining a security’s fair value.  As a result, different mutual funds could reasonably arrive at a different fair value for the same security.  It is possible that the fair value determined for a security is materially different from the value that could be realized upon the sale of that security or from the values that other mutual funds may determine.  In addition, given the volatility and periodic illiquidity experienced in current markets, the prices determined for any individual security on any given day may vary significantly from the amount that can be obtained in an actual sale of that security.

In September 2006, the Financial Accounting Standards Board (FASB) issued SFAS 157, “Fair Value Measurements.” SFAS 157 defines fair value, establishes a framework for measuring fair value in accordance with GAAP, and expands disclosure about fair value measurements. SFAS 157 is effective for financial statements issued for fiscal years beginning after November 15, 2007.  Management has determined that SFAS 157 had no material impact on the Fund’s financial statements.

In March 2008, Statement of Financial Accounting Standards No. 161, “Disclosures about Derivative Instruments and Hedging Activities” (“SFAS 161”) was issued and is effective for fiscal years beginning after November 15, 2008.  SFAS 161 is intended to improve financial reporting for derivative instruments by requiring enhanced disclosure that enables investors to understand how and why an entity uses derivatives, how derivatives are accounted for, and how derivative instruments affect an entity’s results of operations and financial position.  SFAS 161 does not have any impact on the Fund’s financial statement disclosures because the Fund has not maintained any positions in derivative instruments or engaged in hedging activities.

In preparing these financial statements, the Company has evaluated events and transactions for potential recognition or disclosure through August 28, 2009, the date the financial statements were available to be issued.

b) Foreign Securities – Foreign securities are defined as securities issued by companies that are organized outside the United States.  Investing in securities of foreign companies and foreign governments involves special risks and considerations not typically associated with investing in U.S. companies and the U.S. government.  These risks include revaluation of currencies and future adverse political and economic developments.  Moreover, securities of many  

Page 17

RiverFront Long-Term Growth Fund

Notes to the Financial Statements       June 30, 2009 (Unaudited)

2. SIGNIFICANT ACCOUNTING POLICIES (cont.)

foreign companies and foreign governments and their markets may be less liquid and their prices more volatile than those of securities of comparable U.S. companies and the U.S. government.  Occasionally, events that affect those values and exchange rates may occur after the close of the exchange on which such securities are traded.  If such events materially affect the value of a Fund’s securities, these securities may be valued at their fair value pursuant to procedures adopted by the Board of Directors.  All the foreign securities owned by the Fund as of June 30, 2009 are traded on the New York Stock Exchange or NASDAQ.

c) Federal Income Taxes – The Fund intends to continue to qualify as a regulated investment company as provided in subchapter M of the Internal Revenue Code and to distribute substantially all of its taxable income to its shareholders in a manner which results in no tax cost to the Fund.  Therefore, no federal income or excise tax provision is recorded.

The Fund adopted Financial Accounting Standards Board (FASB) Interpretation No. 48 (FIN 48), “Accounting for Uncertainty in Income Taxes,” a clarification of FASB Statement No. 109, “Accounting for Income Taxes.” FIN 48 establishes financial reporting rules regarding recognition and measurement of tax positions taken or expected to be taken on a tax return. Management has determined that FIN 48 has not resulted in any liability to the Fund.

d) Distributions to Shareholders – Dividends from net investment income, if any, are declared and paid annually.  Distributions of net realized gains, if any, are declared and paid at least annually.

e) Allocation of Income and Expenses – The Fund is charged for those expenses directly attributable to it.  Expenses directly attributable to a class of shares, such as Rule 12b-1 distribution fees, are charged to that class of shares.  Income, expenses, and realized and unrealized gains and losses are allocated to the classes based on their respective net assets.  Expenses that are not directly attributable to the Fund are allocated among the series of the Corporation in proportion to their assets.

f) Use of Estimates – The preparation of financial statements in conformity with accounting principles generally accepted in the United States requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period.  Actual results could differ from those estimates.

g) Other – Investment and shareholder transactions are recorded on trade date.  The Fund determines the gain or loss realized from investment transactions by comparing the original cost of the security lot sold with the net sales proceeds.  Dividend income is recognized on the ex-dividend date and interest income is recognized on an accrual basis.  Accounting principles generally accepted in the United States require that permanent financial reporting and tax differences be reclassified in the capital accounts.

h) Guarantees and Indemnifications – In the normal course of business, the Fund enters into contracts with service providers that contain general indemnification clauses.  The Fund’s maximum exposure under these arrangements is unknown and this would involve future claims against the Fund that have not yet occurred.  Based on experience, the Fund would expect the risk of loss to be remote.

Page 18

RiverFront Long-Term Growth Fund

Notes to the Financial Statements       June 30, 2009 (Unaudited)

3. CAPITAL SHARE TRANSACTIONS

The following table summarizes the capital share transactions of the Fund for the six month period ended June 30, 2009 and for the period from October 28, 2008 (commencement of operations) through December 31, 2008:

	Six Months Ended							Six Months Ended
	June 30, 2009							June 30, 2009
Institutional Class Shares	Shares			Amount			Investor Class Shares	Shares			Amount
Shares sold		722,259		$	7,197,158		Shares sold		242,789		$	2,591,545
Shares redeemed		(177,276	)		(1,633,254	)	Shares redeemed		(10,574	)		(103,941	)
Net increase		544,983		$	5,563,904		Net increase		232,215		$	2,487,604
Shares Outstanding:							Shares Outstanding:
Beginning of period		709,014					Beginning of period		40,622
End of period		1,253,997					End of period		272,837

	October 28, 2008(1)							October 28, 2008(1)
	through							through
	December 31, 2008							December 31, 2008
Institutional Class Shares	Shares			Amount			Investor Class Shares	Shares		Amount
Shares sold		727,917		$	7,567,640		Shares sold		40,368	$	411,344
Shares issued to							Shares issued to
shareholders in							shareholders in
reinvestment of							reinvestment of
distributions		5,326			54,064		distributions		254		2,578
Shares redeemed		(24,229	)		(213,933	)	Shares redeemed		—		—
Net increase		709,014		$	7,407,771		Net increase		40,622	$	413,922
Shares Outstanding:							Shares Outstanding:
Beginning of period		—					Beginning of period		—
End of period		709,014					End of period		40,622

(1) Commencement of operations.

Page 19

RiverFront Long-Term Growth Fund

Notes to the Financial Statements       June 30, 2009 (Unaudited)

4. INVESTMENT TRANSACTIONS AND INCOME TAX INFORMATION

During the six months ended June 30, 2009, the Fund’s purchases and sales of investment securities (excluding short-term investments) were $11,383,924 and $3,360,990, respectively.

At December 31, 2008, the Fund’s accumulated earnings/losses on a tax basis were as follows:

	RiverFront
	Long-Term
	Growth Fund
Cost of Investments	$	7,847,116
Gross unrealized appreciation	$	291,488
Gross unrealized depreciation		(169,719	)
Net unrealized appreciation	$	121,769
Undistributed ordinary income	$	2,683
Undistributed long-term capital gain		—
Total distributable earnings	$	2,683
Other accumulated losses	$	(81,440	)
Total accumulated earnings	$	43,012

Undistributed income or net realized gains for financial statement purposes may differ from amounts recognized for federal income tax purposes due to differences in the recognition and characterization of income, expense and capital gain items.

Under the current tax law, capital losses realized after October 31 may be deferred and treated as occurring on the first day of the following fiscal year.  For the period October 28, 2008 through December 31, 2008, the Fund elected to defer capital losses occurring between November 1, 2008 and December 31, 2008 in the amount of $81,440.

At December 31, 2008, the Fund had no accumulated net realized capital loss carryovers.  To the extent the Fund realizes future net capital gains, taxable distributions to shareholders will be offset by any unused capital loss carryovers.

During the six months ended June 30, 2009, the Fund did not distribute ordinary income dividends and net realized capital gains.  During the period October 28, 2008 through December 31, 2008, the Fund paid ordinary income dividends of $62,375. The Fund did not distribute net realized capital gains.

5. INVESTMENT ADVISORY AND OTHER AGREEMENTS

The Fund has entered into an Investment Advisory Agreement with Baird for the provision of investment advisory services. Pursuant to the Investment Advisory Agreement, the Advisor is entitled to receive a fee, calculated daily and payable monthly, at the annual rate of 0.65% for the Fund as applied to the Fund’s average daily net assets.  Certain officers of the

Page 20

RiverFront Long-Term Growth Fund

Notes to the Financial Statements       June 30, 2009 (Unaudited)

5. INVESTMENT ADVISORY AND OTHER AGREEMENTS (cont.)

Advisor are also officers of the Fund.  The Fund has also entered into a Sub-Advisory Agreement with Baird and RiverFront under which RiverFront in its capacity as investment sub-advisor is responsible for the management of the Fund’s assets subject to the Advisor’s oversight.  Pursuant to the Sub-Advisory Agreement, the Advisor (not the Fund) is responsible for paying RiverFront a sub-advisory fee at an annual rate of 0.45% of the Fund’s average daily net assets.

For the period from October 28, 2008 through December 31, 2008 (commencement of operations), and years ending 2009, 2010 and 2011, the Advisor has contractually agreed to waive its investment advisory fee and/or reimburse the Fund’s operating expenses (exclusive of brokerage commissions, taxes, and extraordinary expenses, but including the fees and expenses incurred by the Fund in connection with its investments in ETFs and other investment companies) to the extent necessary to ensure that the Fund’s annual operating expenses do not exceed 0.90% of the average daily net assets of the Fund’s Institutional Class Shares and 1.15% of the average daily net assets of the Fund’s Investor Class Shares.

To the extent that the Advisor reimburses or absorbs fees and expenses, it may seek payment of such amounts for three years after the year in which expenses were reimbursed or absorbed.  The Fund will make no such payment, however, if its total annual operating expenses exceed the expense limits in effect at the time the expenses were reimbursed or at the time these payments are proposed.

		Period Ended
		October 28, 2008
	Six Months Ended	through
	June 30, 2009	December 31, 2008
Reimbursed/Absorbed Expenses Subject to Recovery By Advisor Until:	2012	2011
RiverFront Long-Term Growth Fund	$48,459	$35,032

U.S. Bancorp Fund Services, LLC serves as transfer agent, administrator, and accounting services agent for the Fund.  U.S. Bank, N.A. serves as custodian for the Fund.

Robert W. Baird & Co. Incorporated (the “Distributor”) is the sole distributor of the Fund pursuant to a distribution agreement.

No commissions were earned by the Distributor for services rendered as a registered broker-dealer in securities transactions for the Fund for the six months ended June 30, 2009.

6. LINE OF CREDIT

The Corporation maintains an uncommitted, senior secured line of credit (“LOC”) with U.S. Bank, N.A. (the “Bank”) to provide the Fund a temporary liquidity source to meet unanticipated redemptions.  Under the terms of the LOC, borrowings for the Fund are limited to one-third of the total assets (including the amount borrowed), or as otherwise indicated within the Fund’s agreement with the Bank.  The Bank charges interest at the Bank’s Prime Rate less 1%.  For the six months ended June 30, 2009 the Fund did not borrow from the LOC.

Page 21

RiverFront Long-Term Growth Fund

Notes to the Financial Statements       June 30, 2009 (Unaudited)

7. DISTRIBUTION AND SHAREHOLDER SERVICE PLAN

The Fund has adopted a distribution and shareholder service plan (the “Plan”) pursuant to Rule 12b-1 under the 1940 Act.  The Plan allows the Fund to compensate the Distributor for the cost incurred in distributing the Fund’s Investor Class Shares, including amounts paid to brokers or dealers, at an annual rate not to exceed 0.25% of the average daily net assets of the Fund’s Investor Class Shares.  The Fund incurred $1,356 in fees pursuant to the Plan during the six months ended June 30, 2009.

Page 22

Additional Information

Proxy Voting

A description of the policies and procedures that the Fund uses to determine how to vote proxies relating to portfolio securities is available without charge, upon request, by calling toll free, 1-866-44BAIRD, or by accessing the Fund’s website at www.bairdfunds.com; and by accessing the SEC’s website at www.sec.gov.

The Fund’s proxy voting record for the most recent 12-month period ended June 30 will be available in August 2009 without charge, upon request, by calling toll free, 1-866-44BAIRD, or by accessing the Fund’s website at www.bairdfunds.com; and by accessing the SEC’s website at www.sec.gov.

Portfolio Holdings Disclosure

The Fund files a complete schedule of portfolio holdings with the SEC for the first and third quarters of each fiscal year on Form N-Q.  The Fund’s Forms N-Q are available on the SEC website at www.sec.gov and may be reviewed and copied at the SEC’s Public Reference Room in Washington, D.C.  Information on the operation of the Public Reference Room may be obtained by calling 1-800-732-0330.  The Fund’s Forms N-Q may also be obtained by calling toll-free 1-866-44BAIRD.

Page 23

(This Page Intentionally Left Blank.)

Baird Funds, Inc.

RiverFront Long-Term Growth Fund

c/o U.S. Bancorp Fund Services, LLC

P.O. Box 701

Milwaukee, WI 53201-0701

1-866-44BAIRD

Board of Directors

G. Frederick Kasten, Jr. (Chairman)

John W. Feldt

Frederick P. Stratton, Jr.

Cory L. Nettles

Marlyn J. Spear

Investment Advisor and Distributor

Robert W. Baird & Co. Incorporated

777 East Wisconsin Avenue

Milwaukee, WI 53202

Sub-Advisor

RiverFront Investment Group, LLC

9011 Arboretum Parkway

Suite 110

Richmond, VA 23236

Administrator and Transfer Agent

U.S. Bancorp Fund Services, LLC

P.O. Box 701

615 East Michigan Street

Milwaukee, WI 53202

Custodian

U.S. Bank, N.A.

1555 N. RiverCenter Drive, Suite 302

Milwaukee, WI 53212

Legal Counsel

Godfrey & Kahn, S.C.

780 North Water Street

Milwaukee, WI 53202

Independent Registered Public Accounting Firm

Grant Thornton LLP

175 West Jackson Boulevard, 13th Floor

Chicago, IL 60604

Item 2. Code of Ethics.

Not applicable - only required for annual reports on Form N-CSR.

Item 3. Audit Committee Financial Expert.

Not applicable - only required for annual reports on Form N-CSR.

Item 4. Principal Accountant Fees and Services.

Not applicable - only required for annual reports on Form N-CSR.

Item 5. Audit Committee of Listed Registrants.

Not applicable to registrants who are not listed issuers (as defined in Rule 10A-3 under the Securities Exchange Act of 1934).

Item 6. Schedule of Investments.

The Schedules of Investments are included as part of the semi-annual reports to shareholders filed under Item 1 of this Form N-CSR.

Item 7. Disclosure of Proxy Voting Policies and Procedures for Closed-End Management Investment Companies.

Not applicable because the Registrant is not a closed-end management investment company.

Item 8. Portfolio Managers of Closed-End Management Investment Companies.

Not applicable because the Registrant is not a closed-end management investment company.

Item 9. Purchases of Equity Securities by Closed-End Management Investment Company and Affiliated Purchasers.

Not applicable because the Registrant is not a closed-end management investment company.

Item 10. Submission of Matters to a Vote of Security Holders.

There have been no material changes to the procedures by which shareholders may recommend nominees to the Registrant’s board of directors.

Item 11. Controls and Procedures.

(a)   The Registrant’s management, with the participation of its principal executive and principal financial officers, has evaluated the effectiveness of the Registrant's disclosure controls and procedures (as defined in Rule 30a-3(c) under the Investment Company Act of 1940 (the “Act”)), as of a date within 90 days prior to the filing date of this Form N-CSR.  Based on such evaluation, the Registrant's principal executive and principal financial officers have concluded that the design and operation of the Registrant's disclosure controls and procedures are effective in providing reasonable assurance that the information required to be disclosed on Form N-CSR is recorded, processed, summarized and reported within the applicable time periods.

(b)   There were no changes in the Registrant's internal control over financial reporting (as defined in Rule 30a-3(d) under the Act) that occurred during the second fiscal quarter of the period covered by this report that has materially affected, or is reasonably likely to materially affect, the Registrant's internal control over financial reporting.

Item 12. Exhibits.

(a)   (1) Any code of ethics or amendment thereto, that is subject of the disclosure required by Item 2, to the extent that the registrant intends to satisfy Item 2 requirements through filing an exhibit. Not Applicable.

(2) Certifications pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.  Filed herewith.

(3) Any written solicitation to purchase securities under Rule 23c-1 under the Act sent or given during the period covered by the report by or on behalf of the registrant to 10 or more persons.  Not applicable because the Registrant is not a closed-end management investment company.

(b)   Certification pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.  Furnished herewith.

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment Company Act of 1940, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

BAIRD FUNDS, INC.

By:          /s/ Mary Ellen Stanek

Mary Ellen Stanek, President

Date:      September 8, 2009

Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment Company Act of 1940, this report has been signed below by the following persons on behalf of the registrant and in the capacities and on the dates indicated.

By:          /s/Mary Ellen Stanek

Mary Ellen Stanek, President

Date:      September 8, 2009

By:          /s/Leonard M. Rush

Leonard M. Rush, Treasurer

Date:       September 8, 2009

EX-99.CERT

CERTIFICATIONS

I, Mary Ellen Stanek, certify that:

1.   I have reviewed this report on Form N-CSR of Baird Funds, Inc.;

2.   Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3.   Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations, changes in net assets, and cash flows (if the financial statements are required to include a statement of cash flows) of the registrant as of, and for, the periods presented in this report;

4.   The registrant's other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Rule 30a-3(c) under the Investment Company Act of 1940) and internal control over financial reporting (as defined in Rule 30a-3(d) under the Investment Company Act of 1940) for the registrant and have:

(a)   Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

(b)   Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

(c)   Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of a date within 90 days prior to the filing date of this report based on such evaluation; and

(d)   Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the second fiscal quarter of the period covered by this report that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5.   The registrant's other certifying officer(s) and I have disclosed to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):

(a)   All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize, and report financial information; and

(b)   Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.

Date      September 8, 2009 /s/Mary Ellen Stanek Mary Ellen Stanek, President  

CERTIFICATIONS

I, Leonard M. Rush, certify that:

1.   I have reviewed this report on Form N-CSR of Baird Funds, Inc.;

2.   Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3.   Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations, changes in net assets, and cash flows (if the financial statements are required to include a statement of cash flows) of the registrant as of, and for, the periods presented in this report;

4.   The registrant's other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Rule 30a-3(c) under the Investment Company Act of 1940) and internal control over financial reporting (as defined in Rule 30a-3(d) under the Investment Company Act of 1940) for the registrant and have:

(a)   Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

(b)   Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

(c)   Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of a date within 90 days prior to the filing date of this report based on such evaluation; and

(d)   Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the second fiscal quarter of the period covered by this report that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5.   The registrant's other certifying officer(s) and I have disclosed to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):

(a)   All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize, and report financial information; and

(b)   Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.

Date:      September 8, 2009 /s/Leonard M. Rush Leonard M. Rush, Treasurer

EX-99.906 CERT

Certification Pursuant to Section 906 of the Sarbanes-Oxley Act

Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, each of the undersigned officers of Baird Funds, Inc. does hereby certify, to such officer’s knowledge, that the report on Form N-CSR of Baird Funds, Inc. for the period ended June 30, 2009 fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934, as applicable, and that the information contained in the Form N-CSR fairly presents, in all material respects, the financial condition and results of operations of Baird Funds, Inc. for the stated period.

/s/Mary Ellen Stanek Mary Ellen Stanek President, Baird Funds, Inc.	/s/Leonard M. Rush Leonard M. Rush Treasurer, Baird Funds, Inc.
Dated:      September  8, 2009	Dated:      September  8, 2009

This statement accompanies this report on Form N-CSR pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 and shall not be deemed as filed by Baird Funds, Inc. for purposes of the Securities Exchange Act of 1934.