Sector Allocation Fund
Fund Strategy
Astor’s Sector Allocation Fund is designed to replace traditional core equity investments by combining Astor’s macroeconomic approach with dynamic allocation. The Fund seeks to provide capital appreciation during periods of economic expansion by investing in sectors and broad markets categories displaying positive fundamental and/or price trends. A proprietary sector rotation model seeks to under/overweight sectors throughout periods in order to take advantage of growth differentials between sectors. As economic trends weaken, the Fund will attempt to progressively lower equity exposure and substitute with cash and/or fixed income positions in order to manage risk and reduce significant drawdowns. The Fund uses exchange-traded funds (“ETFs”) for portfolio construction.
Resources
Discussion
The Fund seeks to achieve its objectives by investing in in Exchange-Traded Funds (“ETFs”). An ETF is a type of Investment Company which attempts to achieve a return similar to a set benchmark or index. The value of an ETF is dependent on the value of the underlying assets held. ETFs are subject to investment advisory and other expenses which results in a layering of fees for clients. As a result, your cost of investing in the fund will be higher than the cost of investing directly in ETFs and may be higher than other mutual funds with similar investment objectives. ETFs may trade for less than their net asset value. Although ETFs are exchanged traded, a lack of demand can prevent daily pricing and liquidity from being available.
The Fund can purchase ETFs with exposure to equities, fixed income, and specific sectors. The underlying investments of these ETFs have different risks. Equity prices can fluctuate for a variety of reasons including market sentiment and economic conditions. The prices of small and mid-cap companies tend to be more volatile than those of larger, more established companies. It is important to note that bond prices move inversely with interest rates and fixed income. Fixed Income ETFs can experience negative performance in a period of rising interest rates. Debt issuers may not make interest or principal payments, resulting in losses to the funds. In addition, the credit quality of securities held by an ETF or underlying fund may be lowered if an issuer’s financial condition changes. High yield bonds are subject to higher risk of principal loss due to an increased chance of default. Investments in specific sectors can experience greater levels of volatility than broad-based investments due to their more narrow focus.
Disclosure
All information contained herein is for informational purposes only. This is not a solicitation to offer investment advice or services in any state where to do so would be unlawful. Analysis and research are provided for informational purposes only, not for trading or investing purposes. All opinions expressed are as of the date of publication and subject to change. Astor and its affiliates are not liable for the accuracy, usefulness or availability of any such information or liable for any trading or investing based on such information.
Mutual funds involve risk including the possible loss of principal. The funds may invest in alternative assets and specialty market segments. The risks and volatility of these products are linked to investments in equities, derivatives, commodities, futures, real estate or currency exchange rates and may include leverage, which magnifies the changes in the value of the ETF and are subject to leverage, credit risk and counterparty risks. Foreign investing, including emerging markets, involves risks not typically associated with U.S. Investments, including fluctuations in currency values, political, social and economic developments, liquidity, volatility, less efficient markets, and differing legal standards.
The adviser’s dependence on its proprietary economic analysis and judgements about the attractiveness, value and potential appreciation of asset classes may prove to be incorrect and ay not produce the desired results. ETF’s are subject to investment advisory fees and other expenses, which will be indirectly paid by the Fund. As a result, your cost of investing in the Fund will be higher than the cost of investing directly in the ETF’s and may be higher than other mutual funds. The net asset value of the Fund will fluctuate based on changes in the value of the equity securities in which in invests through ETF’s.
When investing in fixed-income, the value of your investment if the Fund will fluctuate with changes in interest rates. Lower quality (high yield or junk) bond are considered speculative and preset greater risk than bonds of higher quality. Debt issuers, including sovereign debt, may not make interest or principal payments resulting in losses to the Fund. Securities of small and medium capitalization companies may be subject to more abrupt or erratic market movements than those of larger more established companies.
An investor should consider the Astor funds’ investment objectives, risks, charges, and expenses carefully before investing. This and other information about the Astor funds are contained in the funds’ prospectus, which can be obtained by calling (877) 738-0333. Please read the prospectus carefully before investing. The funds are distributed by Northern Lights Distributors, LLC a FINRA/SIPC member. Astor Investment Management is not affiliated with Northern Lights Distributors, LLC. 3525-NLD-7/20/2017 2017-126.