Schooner Hedged Alternative Income Fund
Fund Facts
- Ticker (Institutional Share Class): SHAIX
- Ticker (A Share Class): SHAAX
- Style: Market Neutral
- Fund Inception Date: 11/28/2014
- AUM: $209mm
- Min. Investment: $5,000
- Trust: Trust for Professional Managers, serviced by U.S. Bancorp Fund Services
- Intends to distribute a 0.70% cash payout on the 25th of every month*
*A portion of the payment you receive each month could be a return of capital. AS SUCH, THE MONEY YOU INVEST COULD BE RETURNED TO YOU TO HELP SATISFY THAT MONTH’S PAYOUT REQUIREMENT. It is also possible for the fund to suffer substantial investment losses and simultaneously experience additional asset reductions as a result of its distributions to shareholders under its managed-distribution
Net Expense Ratio SHAIX 1.39%, SHAAX 1.64% Gross Expense Ratio 3.66%, 3.91%. The Advisor has agreed to waive its management fees and/or reimburse Fund expenses to ensure that Total Annual Fund Operating Expenses (exclusive of interest, acquired fund fees and expenses, leverage (i.e. any expenses incurred in connection with borrowings made by the Fund) and tax expenses, dividends and interest expenses on short positions, brokerage commissions, and extraordinary expenses) do not exceed SHAIX 1.39%, and SHAAX 1.64% of the Fund’s average annual net assets through at least February 1, 2017.
Investment Objective
The investment objective of the Schooner Hedged Alternative Income Fund is long term appreciation through the generation of income using strategies that have minimal correlation with traditional fixed income markets.
Investment Goals
- Generate Uncorrelated Cash Flows with:
- No interest rate risk
- No duration risk
- No credit risk
- Equity market neutrality
- Low volatility of returns
- Monthly distributions
Investment Strategy
The Schooner Hedged Alternative Income Fund seeks to:
- Generate Cash Flow: Sell a well-diversified basket of expensive out-of-the-money single name, equity puts.
- Proactive Risk Management: Hedge by buying cheaper, near-the-money index puts, with continuous re-balancing.
- Monthly Payout: Fixed monthly distribution.
Correlation is a statistical measure of how two securities move in relation to each other.
Duration is a measure of the sensitivity of the price of a fixed-income investment to a change in interest rates.
Click Here for Schooner Hedged Alternative Income Fund Prospectus.
Mutual fund investing involves risk; principal loss is possible. Options may be more volatile than investments directly in the underlying securities, involve additional costs and may involve a small initial investment relative to the risk assumed. The Fund’s investments in options could include the loss of the entire premium and the value of the underlying asset. The Fund’s investment in derivative instruments (“Derivatives”), including options, may be more volatile than investments directly in the underlying securities, involve additional costs and may involve a small initial investment relative to the risk assumed. The Fund’s investments in Derivatives could create exposure greater than the value of securities in the Fund’s portfolio. Derivatives investments may create economic leverage and can result in losses to the Fund that exceed the original amount invested. Small-, mid- and micro-cap companies may not have the management experience, financial resources, product diversification and competitive strengths of large-cap companies and, therefore, their securities tend to be more volatile than the securities of larger, more established companies, making them less liquid than other securities. The value of put options on ETFs sold by the Fund is based on the value of the ETFs underlying the options. The price of an ETF can fluctuate within a wide range, and the value of an option on an ETF may decrease if the prices of the securities owned by the ETF go down. An index ETF may not replicate the performance of a benchmark index it seeks to track. In addition, an ETF is subject to the risk that the market price of the ETF’s shares may trade at a discount to its NAV or an active trading market for its shares may not develop or be maintained. Trading of an ETF’s shares may be halted, during which time an option may be exercised, exposing the Fund to the risks of directly investing in an ETF’s shares. A decline in the value of an investment in a single issuer could cause the Fund’s overall value to decline to a greater degree than if the Fund held a more diversified portfolio. There can be no assurance that the Fund will grow to or maintain an economically viable size.
Diversification does not assure a profit nor protect against loss in a declining market.
The Schooner Funds are distributed by Quasar Distributors, LLC.