The ATAC Fund uses a proprietary approach to position more defensively or offensively in a portfolio. The process is consistent and repeatable.
ATAC positions into bond ETFs when our indicators are giving a defensive signal and into equity ETFs when they are giving an offensive signal.
The approach attempts to evaluate conditions which favor higher or lower stock market volatility.
The strategy positions defensively when odds favor rising volatility and offensively when odds favor a falling volatility environment.
ATAC uses broad equity and bond exchange-traded funds (ETFs).
The indicators are evaluated on a weekly basis for potential rotations in the portfolio. Changes are made only when our proprietary signals suggest a directional change from offense to defense or defense to offense is warranted, and/or when relative momentum has changed.
We don’t believe in overly complex, 100-variable quantitative models. We believe there are a select group of factors that have predictive value in markets and have written about two of these factors in award-winning research papers.
Full copies of the papers can be downloaded at SSRN.com.
In offensive mode, ATAC can invest in U.S. large cap ETFs, U.S. small cap ETFs, or Emerging Market ETFs. In defensive mode, ATAC can invest in long duration bonds or short duration bonds.
We manage risks by using diversified ETFs and employing a strategy that seeks to decrease the beta in our portfolios ahead of periods of market stress. It is important to note that while the fund can get defensive ahead of high volatility periods, this does not mean that volatility in the fund will not be higher at times than the stock market’s. Rather, fund volatility characteristics tend to be different than a simple buy and hold passive index.
In our research, using bonds as the lower beta option is superior to cash and short positions over a full market cycle. The fund is built to perform during a full market cycle which includes bull and bear market environments. Using cash and short positions can lead to significant underperformance during bull market periods.
Yes. The fund may have up to 133% exposure when in offensive mode.
The fund is intended to be an active risk management vehicle. As such, it is expected to have a high portfolio turnover which could exceed 1,000% on an annual basis, depending on market conditions. This is likely to result in short-term capital gains.
ATAC offers an investor class/A share class (Ticker: ATACX) and a institutional share class (Ticker: ATCIX).
Yes. ATAC is a no-load fund.
ATAC (Investor) – Gross expense ratio: 2.14%. Net expense ratio: 1.95%. Note this includes the acquired Fund fees on the ETFs in the portfolio.
ATAC (Institutional) – Gross expense ratio: 1.89%. Net expense ratio: 1.70%. Note this includes the acquired Fund fees on the ETFs in the portfolio.The Advisor has contractually agreed to waive a portion or all of its management fees and reimburse Fund expenses, in order to ensure that Total Annual Fund Operating Expenses (excluding AFFE, leverage/borrowing interest, interest expense, taxes, brokerage commissions and extraordinary expenses) do not exceed 1.74% of the average daily net assets of the Fund’s Investor Class shares and do not exceed 1.49% of the average daily net assets of the Fund’s Institutional Class shares.The Operating Expenses Limitation Agreement is indefinite, but cannot be terminated through at least May 1, 2022.
ATAC is available on most major brokerage platforms, including, but not limited to, Fidelity, Vanguard, Schwab, TD Ameritrade, Securities America, Scottrade, E*trade, UBS and Folio.
The minimum initial investment is $2,500 for the investor class (Ticker: ATACX) and $25,000 for the institutional class (Ticker: ATCIX).
When investing in ATAC, investors will receive a Form 1099 from their broker on an annual basis.
The Fund pays dividends annually in December based on accumulated dividends throughout the year from holdings. There may also be a capital gains distribution based on trading gains and losses.
ATAC seeks to achieve absolute positive returns over time.
Our goal is to educate our investors so that they can choose the offering or offerings that best suit their investment objectives. ATAC fits into the alternative or tactical allocation bucket. It tends to act as a non-correlated alternative and can add significant diversification benefits over the course of a full market cycle.
If there were an investment strategy that worked all of the time, everyone would follow it and it would stop working. The Fund is designed specifically to take advantage of the anomaly that you can position ahead of stock market volatility. Anomalies themselves have cycles, which can be either favorable or unfavorable for the types of risk rotations employed in the Fund. There will be months, quarters, or even longer that our strategies will underperform one benchmark or another, but this is true of any strategy that is successful over time. Furthermore, the potential to be defensive ahead of higher volatility regimes in equities makes the magnitude of potential outperformance during such periods significantly greater than might otherwise be obvious when looking at past performance in a lower volatility cycle.
We are dedicated to following a disciplined process with the core belief that over the course of a full market cycle, adhering to our process will reward our investors. Our broad philosophy is that true long-term outperformance does not come from being up more, but rather down less.
Diversification does not assure a profit nor protect against a loss in a declining market.
Beta is a measure of the volatility, or systematic risk, of a security or a portfolio in comparison to the market as a whole.
While the fund is no-load, management and other expenses still apply.
The Fund is only offered to United States residents, and information on this site is intended only for such persons. Nothing on this web site should be considered a solicitation to buy or an offer to sell shares of our Fund in any jurisdiction where the offer or solicitation would be unlawful under the securities laws of such jurisdiction.