Tactical Approach Overview

What is the “Tactical?” strategy? The Tactical approach aims to deliver growth with less severe ups and downs than stocks. With a focus on risk-managed performance, this approach uses sophisticated techniques generally reserved for hedge funds with the transparency, liquidity and accessibility of a mutual fund.

Managing Risk

To help keep volatility in check, the Tactical approach incorporates a strategy that seeks to smooth the ups and downs of stock market investing. The level of stock market exposure is based on a “weight of the evidence” approach that allows the manager to consider valuations, trend strength, investor sentiment, monetary conditions and current volatility – and adjust the portfolio as often as needed. The funds that use the Tactical approach are not  always fully invested. Instead, these funds may hold considerable cash and use a variety of hedging techniques in an attempt to help reduce volatility. These funds actively writes covered call options, which aim to generate income and buffer downside risk. We seek to provide some of the growth potential of equities with much less volatility than a long-only investment strategy.

  • Small- and medium-capitalization companies tend to have limited liquidity and greater price volatility than large-capitalization companies.
  • Investments in foreign securities involve greater volatility and political, economic and currency risks and differences in accounting methods.
  • Investments in debt securities typically decrease in value when interest rates rise. This risk is usually greater for longer-term debt securities.
  •  Non-Diversification Risk –The Underlying Funds may invest in a limited number of issuers and therefore may be considered non-diversified.
  • Short Sales Risk –The Underlying Funds may engage in short sales, which could result in such a fund’s investment performance suffering if it is required to close out a short position earlier than it had intended.
  • ETF Trading Risk – Because the funds invest in ETFs, they are subject to additional risks that do not apply to conventional mutual funds, including the risks that the market price of an ETF’s shares may trade at a discount to its net asset value ("NAV"), an active secondary trading market may not develop or be maintained, or trading may be halted by the exchange in which they trade, which may impact a Fund’s ability to sell its shares.

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