Altrius Enhanced Income Fund
An unconstrained bond approach enhanced with option income
The investment objectives of the Fund are to generate income and maximize long-term total return. The Fund incorporates two distinct strategies: It invests in bonds of any credit rating or maturity to generate income and employs an option overlay strategy designed to enhance the amount of income generated.
Find yield anywhere in the fixed income universe
Add uncorrelated income from options
Flexible income generation for every environment
|PERFORMANCE (as of 6/30/2017)|
|Barclays Aggregate Bond
Performance data quoted represents past performance and is no guarantee of future results. Current performance may be lower or higher than the performance data quoted. Returns for one year or less are cumulative. Investment return and principal value will fluctuate so that an investor’s shares, when redeemed, may be worth more or less than original cost. For the most recent month end performance, please call 1-844-524-9366. Other share class performance may vary.
Minimum Investments Initial investment
For Class A and C shares: $2,500
For Class I shares: $10,000
Subsequent Investment: $500
($1,000 for Class I shares)
Automatic Investment Plan: $100
Maximum Sales Charge
For Class A Shares: 5.50%
For Class C and I Shares: None
Maximum Deferred Sales Charge
For Class C Shares: 1.0% on shares
sold within 12 months of purchase
For Class A and I Shares: None
Expense Ratio (Gross)
Class I Shares: 3.09%
Expense Ratio (Net)
Class I Shares: 1.53%
*The Fund’s advisor has contractually agreed to waive its fees and/or operating expenses until April 30, 2018
The Fund will make distributions of net investment income monthly and net capital gains (if any) typically in December. Distributable dividends and taxable capital gains are automatically reinvested in the Fund unless you request cash distributions on your application or through a written request to the Transfer Agent.
For Class A, C and I shares: 2,0% on shares sold within 30 days of purchase.
Fund Assets Under Management
$56.0 Million (as of 6/30/2017)
IMST Distributors, LLC.
December 31, 2015
Altrius Capital Management
An Unconstrained bond strategy driven by three key principles
A Disciplined and Repeatable Quantitative Investment Approach
Top down strategy employed to identify the most compelling portfolio positioning and opportunity set:
Bottom up process seeks to identify companies selling below their intrinsic value:
Invest unconstrained primarily in U.S. dollar-denominated investment grade and high yield bonds:
GLOBAL MACRO TOP DOWN PERSPECTIVE DRIVES INITIAL UNIVERSE
- Yield Curve Positioning
- Sector Rotation
- Credit Risk
VALUE BOTTOM UP VALUE DRIVEN INVESTMENT ANALYSIS DRIVES SECURITY SELECTION
- Income Statement Driven
- Cash-Flow Focused
- Seeking Undervalued Securities
- Potential to Generate High Income and Total Returns from Diversified Holdings.
- Screening for High Yield: Seeking Securities that Exceed the 5 yr Treasury Bond.
TOTAL RETURN FOCUSED ON ACHIEVING HIGHEST TOTAL RETURN WITHIN ACCEPTABLE LEVELS OF RISK
- Invest in government securities, corporate bonds, mortgage backed and asset backed securities diversified across sectors.
- Goal: Achieve an attractive yield/spread relative to the return of a 5 year U.S.Treasury bond within acceptable levels of portfolio risk.
The Fund will typically invest at least 80% of its net assets in a portfolio of bonds such as investment grade securities of U.S. and non-U.S. issuers; emerging market debt; high-yield debt instruments; convertible bonds and mortgage or asset-backed securities. The Fund may invest in bonds of any maturity or credit quality rating. The Fund will enhance the unconstrained bond portfolio with an option overlay strategy intended to generate income.
Two Fish Put Income
A fundamental approach to generating income with options
A Unique Strategy Designed to Enhance the Fund’s Income
This strategy intends to generate income by writing put options on high quality, large capitalization U.S. equities that are out-of-the money — i.e., the option has a strike price that is lower than the market price of the underlying security at the time of purchase of the option sale and Two Fish believes the strike price will remain below the market price for the entire option term. The return to the Fund from the sale of put options is limited
to the amount of option premiums it receives, while the Fund can lose up to the entire strike price at expiration of each option it sells. To mitigate risk, the Fund limits its notional exposure (put option contracts sold multiplied by the strike price of each contract multiplied by 100 shares per contract) to 70% of the market value of the Fund’s bond positions.
FUND ADVISOR AND SUBADVISORS
Kaizen Advisory, LLC, an Illinois limited liability company formed in May 2014, acts as the investment advisor to the Fund. Kaizen is registered with the SEC and has approximately $187.4 million in assets under management as of June 30, 2017. Kaizen’s services to the Fund include: (i) designing the Fund’s initial investment policies; (ii) providing overall supervision of the investment management operations of the Fund and related administrative services.
Subadvisors for the Kaizen Altrius Enhanced Income Strategy Fund are Altrius Capital Management, Inc. (“Altrius”) which manages the bond strategy and Two Fish Management, LLC (“Two Fish”) which manages the overlay (put income) portion of the strategy.
IMPORTANT DISCLOSURE and RISKS
Before investing you should carefully consider the Fund’s investment objectives, risks, charges and expenses. This and other information is in the prospectus, a copy of which may be obtained by calling 1-844-524-9366. Please read the prospectus carefully before you invest.
An investment in the Fund is subject to risk, including the possible loss of principal. Fund risks include, but are not limited to, the following: High yield bonds are debt securities rated below investment grade (“junk bonds”), are speculative, involve greater risks of default, downgrade, or price declines and are more volatile and tend to be less liquid than investment-grade securities. Convertible securities are subject to market and interest rate risk and credit risk. When the market price of the equity security underlying a convertible security decreases the convertible security tends to trade on the basis of its yield and other fixed income characteristics, and is more susceptible to credit and interest rate risks. When the market price of such equity security rises, the convertible security tends to trade on the basis of its equity conversion features and be more exposed to market risk. The prices of foreign securities may be more volatile than the prices of securities of U.S. issuers because of economic and social conditions abroad, political developments, and changes in the regulatory environments of foreign countries. In addition, changes in exchange rates and interest rates may adversely affect the values of the Fund’s foreign investments and foreign companies are generally subject to different legal and accounting standards than U.S. companies. Derivatives instruments involve inherent leverage, which may magnify the Fund’s gains or losses. Adverse changes in the value or level of the underlying asset, reference rate or index can result in loss of an amount substantially greater than the amount invested in the derivative. In addition, the use of leverage may cause the Fund to liquidate portfolio positions when it would not be advantageous to do so in order to satisfy obligations. The Fund must segregate liquid assets, or engage in other measures to “cover” open positions with respect to certain kinds of derivatives and short sales. The Fund may incur losses on derivatives and other leveraged investments (including the entire amount of the Fund’s investment in such investments) even if they are covered.
Purchasing and writing put and call options are highly specialized activities and entail greater than ordinary investment risks. The Fund may not fully benefit from or may lose money on an option if changes in its value do not correspond as anticipated to changes in the value of the underlying securities. If the Fund is not able to sell an option held in its portfolio, it would have to exercise the option to realize any profit and would incur transaction costs upon the purchase or sale of the underlying securities. Ownership of options involves the payment of premiums, which may adversely affect the Fund’s performance. To the extent that the Fund invests in over-the-counter options, the Fund may be exposed to counterparty risk.
Liquidity risk-the Fund may not be able to sell some or all of the investments that it holds due to a lack of demand in the marketplace or other factors such as market turmoil, or if the Fund is forced to sell an illiquid asset to meet redemption requests or other cash needs it may only be able to sell those investments at a loss. The Fund is newly organized and has no operating history. As a result, prospective investors have no track record or history on which to base their investment decisions.
Put is an option contract giving the owner the right, but not the obligation, to sell a specified amount of an underlying asset at a set price within a specified time. Strike Price is the price at which a specific options contract can be exercised. A put option is out-of-the-money if the stock price is above its strike price. The seller of an uncovered put option assumes the risk of an increase in the market price of the underlying security above the exercise price of the option plus the premium received. The buyer of a put option assumes the risk of losing its entire investment in the put option.
Distributed by IMST Distributors, LLC.