COUNTERPOINT TACTICAL INCOME FUND

Fund Objective

The Counterpoint Tactical Income Fund (the “Fund”) seeks income and capital preservation.

Fund Strategy

The Counterpoint Tactical Income Fund aims to provide absolute returns in a stable or recovering market environment and seeks capital preservation in times of economic uncertainty. The Fund uses algorithmic trend-following decision tools to determine when to buy and sell mutual funds and ETFs of high yielding bonds, low duration treasuries, and cash equivalents.

Tactical Versus Passive


TacticalVsPassive

The above example depicts a potential difference between tactical and “buy and hold” passive investment approaches. The Tactical result is not actual historic realized performance of the Tactical Income Fund’s algorithm. It is an example of the hypothetical result from alternating in a binary manner between holding cash or being invested in funds that track the BofA Merrill Lynch High Yield Master II, a non-tradeable index that reflects the total return of the broad market for high yield bonds. Investors cannot directly invest in an index; unmanaged index returns do not reflect any fees, expenses or sales charges.  The Fund is a new fund and does not have a performance record and the above index performance is not intended to serve as a proxy for the Fund’s future performance.

 

Counterpoint’s process seeks to sell high yielding bond funds in a falling price environment, instead allocating the portfolio to safe haven assets such as low duration treasuries or cash equivalents. When the market price for high yielding bond funds stabilizes and starts rising, the Counterpoint Tactical Income Fund’s quantitative model is designed to recommend the purchase of high yielding assets.

The Counterpoint Tactical Income Fund invests primarily in a portfolio of mutual funds, closed-end funds and passively and actively managed exchange traded funds that invest in (i) high yield instruments (also known as (including bonds, bank loans, floating rate bonds and debt and municipal high yield debt); (ii) U.S. treasuries (with an average duration of 1-5 years); and (iii) cash and cash equivalents (including and money market funds).

Fund Tickers and Facts

TickerCPATXCPCTXCPITX
Share ClassClass AClass CInstitutional
Minimum Investment$5,000$5,000$100,000
Minimum IRA Investment$1,000$1,000$100,000
Management Fee1.25%1.25%1.25%
Other Fund Expenses0.27%0.27%0.27%
12b-1 Distribution & Marketing0.25%1.00%None
Total Annual Fund Operating Expenses (Including Acquired Fund Expenses of 0.47%)2.24%2.99%1.99%
Fund Inception DateDec 4, 2014
Fund Overview Sheet
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Quarterly Fact Sheet
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Prospectus
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The Fund’s investment adviser has contractually agreed to reduce its fees and/or absorb expenses of the Fund, at least until January 31, 2019 to ensure that the net annual fund operating expenses exclusive of Acquired Fund Expenses will not exceed 2.00%, 2.75%, and 1.75% attributable to Class A, Class C, and Class I shares, subject to possible recoupment from the Fund in future years. 

Performance Since Inception

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As of August 17, 2018As of June 30, 2018
Return Since Fund Inception (Annualized)Year to Date1 Year ReturnStandard Deviation (Annualized)Return Since Fund Inception (Annualized)Year To Date1 Year Return3 Year Return (Annualized)
CPITX5.57%-0.23%0.42%2.91%5.39%-1.56%-0.39%5.85%
CPATX
Without Sales Load
5.31%-0.47%0.13%2.91%5.15%-1.68%-0.68%5.60%
CPATX
With Sales Load (4.5%)
4.01%-4.94%-4.39%2.91%3.81%-6.10%-5.17%4.00%
CPCTX4.59%-0.94%-0.62%2.91%4.42%-2.09%-1.43%4.82%
Barclays US Aggregate Bond Index1.61%-1.10%-0.78%3.20%1.52%-1.62%-0.40%1.72%


Fund inception date is December 4, 2014.

The performance data displayed here represents past performance, which is no guarantee of future results. Current performance may be lower or higher than the performance data quoted. The investment return and principal value of an investment will fluctuate so that investor’s shares, when redeemed, may be worth more or less than their original cost. A shares (CPATX) have a Front-End Sales Charge (commission or “load”) of 4.50%, with lower rates for accounts over $25,000, and 12b-1 distribution fee of 0.25% per year. For performance information current to the most recent month-end, please call toll-free 844-273-8637.

Fund Holdings


Top Ten Holdings - as of July 31, 2018 
MainStay MacKay High Yield Corporate Bond Fund23.73%
Goldman Sachs High Yield Floating Rate Fund15.9%
TIAA-CREF High Yield Fund13.09%
Transamerica High Yield Bond10.54%
Eaton Vance Income Fund of Boston10.39%
BlackRock High Yield Portfolio7.85%
Dreyfus High Yield Fund7.8%
TREASURY BILL 08/09/20182.62%
U.S. TREASURY BILL 11/08/20182.35%
TREASURY BILL 0% 03/28/20191.81%

Portfolio holdings are subject to change, vary over time and should not be considered a recommendation to buy any individual security.

IMPORTANT RISK INFORMATION

Two contrasting risk exposures are presented in the above Tactical Versus Passive presentation: high yield corporate bonds and “risk-free” cash. The ICE BofA Merrill Lynch High Yield Bond Master II® Index is an unmanaged index that tracks the performance of below investment grade U.S. denominated corporate bonds publicly issued in the U.S. domestic market. The referenced index is shown for general market comparisons and are not meant to represent the Fund. The securities that belong to this index are considered to be high-risk investments. Risks include the greater risk of loss, sensitivity to interest rate and economic changes, valuation difficulties, liquidity, credit quality, and new legislation risk. The green “Tactical” line represents alternating allocation to high yield corporate bonds and cash and their respective associated risks, while the black “Passive” line represents a permanent allocation to high yield corporate bonds and their above mentioned risks.

Mutual Funds involve risk including the possible loss of principal. The use of leverage by the Fund or an Underlying Fund, such as borrowing money to purchase securities or the use of derivatives, will indirectly cause the Fund to incur additional expenses and magnify the Fund’s gains or losses. Derivative instruments involve risks different from, or possibly greater than, the risks associated with investing directly in securities and other traditional investments. There is a risk that issuers and counterparties will not make payments on securities and other investments held by the Fund, resulting in losses to the Fund.

In general, the price of a fixed income security falls when interest rates rise. The Fund may invest in high yield securities, also known as “junk bonds.” High yield securities provide greater income and opportunity for gain, but entail greater risk of loss of principal. When the Fund invests in other investment companies, including ETFs, it will bear additional expenses based on it’s pro rata share of the other investment company’s or ETF’s operating expenses, including the potential duplication of management fees. The risk of owning an investment company generally reflects the risks of owning the underlying investments the investment company holds. The Fund will use model-based strategies that, while historically effective, may not be successful on an ongoing basis or could contain unknown errors. In addition, the data used in models may be inaccurate.



Investors should carefully consider the investment objectives, risks, charges and expenses of the Counterpoint Tactical Income Fund. This and other important information about the Fund is contained in the prospectus, which can be obtained at counterpointmutualfunds.com or by calling 844-273-8637. The prospectus should be read carefully before investing. The Counterpoint Tactical Income Fund is distributed by Northern Lights Distributors, LLC member FINRA/SIPC.

4656-NLD-6/6/2018

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