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EAS Genesis Fund Presentation
 

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    EAS Genesis Fund Presentation EAS Genesis Fund Presentation Presentation Transcript

    • HEDGED INVESTING…in a flexible allocation mutual fund EDGED INVESTING An investor should consider the Fund’s investment objective, risks, charges and expenses carefully before investing. This and other information about the EAS Genesis Fund is contained in the Fund’s prospectus, which can be obtained by calling 1-877-EAS-0757 (1- 877-327-0757). Please read the prospectus carefully before investing. The Fund is distributed by Northern Lights Distributors, LLC, member FINRA/SIPC. EMERALD ASSET ADVISORS, LLC | 2843 Executive Park Drive | Weston, Florida 33331 | 954.385.9624 | 1.877.EAS.0757 info@EmeraldEAS.com | www.EASfunds.com
    • “The Noah Rule: Predicting rain doesn’t count; building arks does.” - Warren Buffet EMERALD ASSET ADVISORS, LLC | 2843 Executive Park Drive | Weston, Florida 33331 | 954.385.9624 | 1.877.EAS.0757 info@EmeraldEAS.com | www.EASfunds.com 1
    • The Advisor • Emerald Asset Advisors, LLC – RIA firm founded in 1998 • Seasoned manager of asset allocation portfolios that go beyond traditional strategies • Focus on alternative low correlation strategies through the use of specialized mutual funds and ETFs • Recognized in national media outlets including Wealth Manager, Registered Rep, Investment News and The Wall Street Transcript AN INNOVATIVE APPROACH TO MONEY MANAGEMENT EMERALD ASSET ADVISORS, LLC | 2843 Executive Park Drive | Weston, Florida 33331 | 954.385.9624 | 1.877.EAS.0757 info@EmeraldEAS.com | www.EASfunds.com 2
    • Today’s Market Landscape A serious retirement crisis looms for boomers, young and old: • Investment climate Very different from the 1980’s and 1990’s • Secular stock bear market Continues to derail retirement plans • The return of inflation A serious threat to wealth and retirement • High-Quality Bond investing Returns too limited to be a retirement savior anymore • Asset allocation Traditional “style boxing” has many flaws “The problem is never to get new, innovative thoughts into your mind, but how to get old ones out.” - Dee Ward Hock EMERALD ASSET ADVISORS, LLC | 2843 Executive Park Drive | Weston, Florida 33331 | 954.385.9624 | 1.877.EAS.0757 info@EmeraldEAS.com | www.EASfunds.com 3
    • Our Mission Fighting the good fight toward retirement • Be flexible in our investment approach • Be adaptive to changes in the global economy and markets • Be opportunistic but not aggressive • Avoid “style box” thinking in our portfolio construction • Find bull markets wherever they exist (via long or short investments) • Capture as much of the market’s upside and as little of its downside as possible • Keep losses short in duration and shallow in magnitude • Produce positive returns in nearly all market environments OUR GOAL IS TO PROVIDE AN ALTERNATIVE PATH TO LONG-TERM CAPITAL PRESERVATION AND GROWTH EMERALD ASSET ADVISORS, LLC | 2843 Executive Park Drive | Weston, Florida 33331 | 954.385.9624 | 1.877.EAS.0757 info@EmeraldEAS.com | www.EASfunds.com 4
    • Our Objective  Old idea, different approach Our goal is to construct portfolios that produce the key benefits often found in hedge fund investing…  Absolute return focused  Low correlation to the global stock and bond markets  Low volatility relative to the stock market  Competitive upside capture with limited downside capture  Flexible investment styles …but without the issues inherent in the hedge fund Limited Partnership (LP) structure: x Lock-ups and limited liquidity x Limited regulation and lack of transparency x Potential for excess leverage x High investment minimums and high management fees x Tax inefficiency WELCOME TO OUR FUND EMERALD ASSET ADVISORS, LLC | 2843 Executive Park Drive | Weston, Florida 33331 | 954.385.9624 | 1.877.EAS.0757 info@EmeraldEAS.com | www.EASfunds.com 5
    • Fund Overview  Diversified strategies in a moderate allocation fund OUR FUND • Absolute return focus • Low market correlation • Low relative volatility • Tax aware USING MUTUAL FUNDS & ETFS • No lock-up period • Daily liquidity • Full transparency • SEC-registered vehicles • Cost effective HEDGED INVESTMENT STRATEGIES/STYLES • Top manager talent • Flexible investment styles • Alpha generators EMERALD ASSET ADVISORS, LLC | 2843 Executive Park Drive | Weston, Florida 33331 | 954.385.9624 | 1.877.EAS.0757 info@EmeraldEAS.com | www.EASfunds.com 6
    • Fund Composition  The Fund combines our three distinct sub-investment strategies: Hybrid, Concentrated Equity and Global Cycle CONCENTRATED GLOBAL HYBRID EQUITY CYCLE • Conservative • Moderate • Aggressive • Alternative strategies • Alpha(1)-driven equity • Global market plays • Absolute return • Long-term growth • Long-term growth • Low net equity exposure • Long equity-biased • Primarily net long • Long and short positions • Periodic hedge overlay • Opportunistic short • 3-year horizon • 5-year horizon positions • 10-year horizon Opportunistic Allocation Fund (1) Alpha: A measure of investment performance adjusted for risk taken. It indicates the portion of a manager’s return that can be attributed to the manager’s skill rather than the movement of the overall market. A positive alpha implies that a manager has added value over and above the performance of the market (also referred to “excess return”). Conversely, a negative alpha would indicate that the manager has reduced value by underperforming the market. EMERALD ASSET ADVISORS, LLC | 2843 Executive Park Drive | Weston, Florida 33331 | 954.385.9624 | 1.877.EAS.0757 info@EmeraldEAS.com | www.EASfunds.com 7
    • Fund Application  A diversified multi-strategy holding that can be used as an alternative to balanced funds, target date funds, lifestyle funds and/or low volatility hedge fund-of-funds Global Market Exposure •India equity Global •China equity Cycle •Global Infrastructure •Alternative energy •Frontier Markets Core Equity Holding •Contrarian value Reward Concentrated •Multicap investing Equity •High ROE growth •GARP •Sector rotation Low Volatility Growth •Long/short equity Hybrid •Merger Arbitrage •Market Neutral •Convertibles •Dedicated short Risk Note: The investment styles listed above are samples of some themes we have pursued within each sub-strategy. They are not all-inclusive, nor are they fixed in any way. The specific investment styles we use may vary at any given time. EMERALD ASSET ADVISORS, LLC | 2843 Executive Park Drive | Weston, Florida 33331 | 954.385.9624 | 1.877.EAS.0757 info@EmeraldEAS.com | www.EASfunds.com 8
    • Risk Profile  The Fund’s three sub-strategies are managed according to different risk parameters. Risk profiles in relation to common Morningstar categories are reflected below: Risk Tolerance Scale (using Morningstar mutual fund categories 1=lowest, 10=highest) 1 2 3 4 5 6 7 8 9 10 US Large US Small Diversified Short-Term Intermediate- Conservative Long-Term Moderate Foreign Large Technology Blend Cap Blend Emerging Bond Term Bond Allocation Bond Allocation Blend Equity Stocks Equity Equity Markets EAS Hybrid EAS Concentrated Equity EAS Global Cycle The Fund’s expected risk range EMERALD ASSET ADVISORS, LLC | 2843 Executive Park Drive | Weston, Florida 33331 | 954.385.9624 | 1.877.EAS.0757 info@EmeraldEAS.com | www.EASfunds.com 9
    • Fund Allocation – Dynamic and Flexible  The Fund dynamically allocates among its sub-strategies based on our assessment of the investment climate, market conditions and best risk/reward opportunities. ALLOCATION RANGES AMONG THE FUND'S SUB-STRATEGIES SINCE INCEPTION: 9% - 41% 31% - 47% 3% - 14% Hybrid Concentrated Equity Global Cycle 3% - 23% Tactical/Options 15% - 24% Cash Note: The pie chart above reflects the allocation weightings that were applied under different market environments since the Fund’s inception date of August 14, 2008. The Fund’s exact allocation will vary at any point in time given current market conditions and the Advisor’s forward-looking analysis of the investment landscape. EMERALD ASSET ADVISORS, LLC | 2843 Executive Park Drive | Weston, Florida 33331 | 954.385.9624 | 1.877.EAS.0757 info@EmeraldEAS.com | www.EASfunds.com 10
    • Investment Philosophy There is a bull in every market – our job is to find it BULL MARKET FORECASTER 1ST QUARTER 2010 EXCELLENT GOOD FAIR POOR Contrarian Global Bank Loan Equity-Income Agricultural Large Cap Balanced Value Equity Infrastructure Funds India (Dividends) Commodities Relative Value Funds Convertible Equity Market- Non-Japan Asia Emerging Dedicated Hedged Equity Brazil Equity Non-US Bonds Arbitrage Neutral Equity Market Bonds Short Equity Environmental Merger “Busted” Financial ROI Growth High-Quality Equities Arbitrage Energy Stocks Oil Convertibles Stocks Equity Bond Funds Equity L/S Natural Gas Small-Midcap China Global REITs Europe Equity S&P 500 Index US Dollar Stocks Frontier Convertible Tactical Asset Healthcare US T-bills (90- Markets Gold Utility Stocks Securities Allocation Stocks day) Dedicated High Yield Short Treasury US REITs Japan Equity “Vice” Equity Bonds Emerging Homebuilding Large Cap Pharma Stocks Stocks Growth Note: The above illustration is not a complete analysis and should not be considered investment advice. The positioning of the investment themes and styles highlighted above reflect the Advisor’s outlook as of 12/31/09 and are subject to change at any time given current market conditions and fluctuations. EMERALD ASSET ADVISORS, LLC | 2843 Executive Park Drive | Weston, Florida 33331 | 954.385.9624 | 1.877.EAS.0757 info@EmeraldEAS.com | www.EASfunds.com 11
    • Portfolio Construction Process Top-down Macroeconomic Assessment Fundamental analysis of critical factors that drive markets and Theme prices Bottom-up Analysis Investments Identify the investment vehicles that best express the themes Quantitative Analysis Analyze all key metrics (trading turnover; expenses; risk stats Weightings and tax implications) Technical Analysis Trade Determine entry / exit points through charting analysis EMERALD ASSET ADVISORS, LLC | 2843 Executive Park Drive | Weston, Florida 33331 | 954.385.9624 | 1.877.EAS.0757 info@EmeraldEAS.com | www.EASfunds.com 12
    • Due Diligence Process Assess market Review written factors and their material & impact on interview manager’s managers strategy Monitor any Continuous Analyze valuation change in Interactive ratios and manager thinking Process economic and style indicators consistency Identify change Evaluate bond in macro rates and yield environment curve EMERALD ASSET ADVISORS, LLC | 2843 Executive Park Drive | Weston, Florida 33331 | 954.385.9624 | 1.877.EAS.0757 info@EmeraldEAS.com | www.EASfunds.com 13
    • Team Seasoned professionals with 90+ years collective experience Robert A. Isbitts Allan M. Budelman Mathew J. MacEachern Chief Investment Officer Managing Partner Portfolio Manager •Co-Founded Emerald in 1998 •Joined Emerald in 1999 •Joined Emerald in 2004 •20+ years in the investment field •15+ years in the investment field •16+ years in the investment field •DLJ, Morgan Stanley, Fiduciary Trust •JP Morgan, Bankers Trust, Chase Manhattan •Fidelity Investments, Leerink Swann & •CFS Designation, 1997 •MBA, University of Miami Company, Inc. •MBA, Rutgers University •BA, University of Maryland •Suffolk University •BS, SUNY Albany Keith D. Stoloff Michael N. Kahn Research Analyst Technical Analyst •Joined Emerald in 2007 •Joined Emerald 2008 •20+ years in the investment field •20+ years in the investment field •Stoloff Advisory, Raymond James, Citicorp, •Barron’s Online Columnist since 2001 Great Western Securities •CMT designation, 2008 ® ® ® ® •CIMA , CIMC , CPWASM, CMFC , AAMS •MBA, New York University •BS, University of South Florida •BA, Brandeis University EMERALD ASSET ADVISORS, LLC | 2843 Executive Park Drive | Weston, Florida 33331 | 954.385.9624 | 1.877.EAS.0757 info@EmeraldEAS.com | www.EASfunds.com 14
    • Fund Performance (net results through quarter-end 12/31/09) (1) Dec '09 3 month 6 month YTD 1Y 3Y 5Y Since Fund's Inception EASAX (A shares) 0.42% 1.68% 6.97% 11.66% 11.66% N/A N/A -1.94% EASIX (I shares) 0.41% 1.68% 7.07% 11.89% 11.89% N/A N/A -1.78% S&P 500 TR 1.93% 6.04% 22.59% 26.46% 26.46% -5.63% 0.42% -7.87% MSCI EAFE 1.44% 2.18% 22.07% 31.78% 31.78% -6.04% 3.54% -7.00% (1) Inception date is August 14, 2008. Reflects net performance annualized through quarter-end 12/31/09. The Fund offers 3 share classes (A, C and I). Maximum sales charge (load) as a percentage of offering price is 5.50% (A shares). See Prospectus for details. The Fund's total annual operating expense ratio (gross) is 3.31% for the class A shares, 4.06% for the class C shares and 3.06% for the class I shares. The Fund's investment adviser has contractually agreed to reduce its fees and/or absorb expenses of the Fund, at least until August 30, 2010, to ensure that the net annual fund operating expenses (exclusive of any front-end or contingent deferred loads, taxes, leverage interest, brokerage commissions, expenses incurred in connection with any merger or reorganization, dividend expense on securities sold short, expenses of investing in Underlying Funds, or extraordinary expenses such as litigation) will not exceed 1.95% for class A shares, 2.70% for class C shares, and 1.70% for class I shares subject to possible recoupment from the Fund in future years. Please review the Fund's prospectus for more detail on the expense waiver. Results shown reflect the waiver, without which the results could have been lower. Expenses are typically reduced as total assets increase. Past performance does not guarantee future results. The performance data quoted represents past performance and current returns may be lower or higher. The investment return and principal value will fluctuate so that an investor's shares, when redeemed may be worth more or less than the original cost. To obtain performance information current to the most recent month-end, please call 1-877-EAS-0757. EMERALD ASSET ADVISORS, LLC | 2843 Executive Park Drive | Weston, Florida 33331 | 954.385.9624 | 1.877.EAS.0757 info@EmeraldEAS.com | www.EASfunds.com 15
    • EASIX Growth Chart (inception through 12/31/09) * EASIX Growth of $1,000 vs. S&P 500 TR EASIX * Inception date is August 14, 2008 S&P 500 TR EMERALD ASSET ADVISORS, LLC | 2843 Executive Park Drive | Weston, Florida 33331 | 954.385.9624 | 1.877.EAS.0757 info@EmeraldEAS.com | www.EASfunds.com 16
    • Why Our Fund? • We employ a flexible and adaptive investment approach • We do not subscribe to the rigid “style box” theory • We aim to pursue the bull markets wherever they exist • We use short positions in an attempt to make money, not just to hedge • We diversify across multiple investment styles and market segments • We strive to deliver a diversified and opportunistic allocation fund that serves as a core holding for any investor, large or small “A lot of times, people don’t know what they want until you show it to them.” - Steve Jobs EMERALD ASSET ADVISORS, LLC | 2843 Executive Park Drive | Weston, Florida 33331 | 954.385.9624 | 1.877.EAS.0757 info@EmeraldEAS.com | www.EASfunds.com 17
    • Fund Facts – EAS Genesis Fund • Share Classes: Class A, Class C and Class I • Symbol: A – EASAX; C – EASYX; I – EASIX • Minimum Investment: Classes A/C: $2,500; Class I: $500,000 • Blue Sky Registration: Class A – all 50 states including DC; Class C/I – varies by state • Advisor Platforms(1): E*Trade, Fidelity, Foliofn, FTJ FundChoice, Pershing, Schwab, Scottrade, SummitAlliance and TD Ameritrade • Transfer Agent: Gemini Fund Services, LLC • Distributor: Northern Lights Distributors, LLC • Website: www.EASfunds.com • Toll-free number: 1-877-EAS-0757 (1) Reflects platform availability as of December 2009. The Fund is also available on various broker-dealer platforms. For specific information, please call 1-877-EAS-0757 An investor should consider the Fund’s investment objective, risks, charges and expenses carefully before investing. This and other information about the EAS Genesis Fund is contained in the fund’s prospectus, which can be obtained by calling 1-877-EAS-0757 (1-877-327-0757). Please read the prospectus carefully before investing. The Fund is distributed by Northern Lights Distributors, LLC, member FINRA/SIPC. EMERALD ASSET ADVISORS, LLC | 2843 Executive Park Drive | Weston, Florida 33331 | 954.385.9624 | 1.877.EAS.0757 info@EmeraldEAS.com | www.EASfunds.com 18
    • Additional Information An investor should consider the Fund’s investment objective, risks, charges and expenses carefully before investing. This and other information about the EAS Genesis Fund is contained in the Fund’s prospectus, which can be obtained by calling 1-877-EAS-0757 (1-877-327-0757). Please read the prospectus carefully before investing. The Fund is distributed by Northern Lights Distributors, LLC, member FINRA/SIPC. Mutual Funds involve risk including possible loss of principal. The Fund may invest in small, less well- known companies, which may be subject to more erratic market movements than large-cap stocks; foreign securities, which are subject to currency fluctuations and political uncertainty; and derivative securities, which may carry market, credit, and liquidity risks. These risks may result in greater share price volatility. The Fund may invest in derivatives (Option Contracts). Even a small investment in options may give rise to leverage risk, and can have a significant impact on the Fund’s performance. Derivatives are subject to credit risk and liquidity risk. The S&P 500 TR Index is an unmanaged composite of 500 large-capitalization companies. The index is widely used by professional investors as a performance benchmark for large-cap stocks. The MSCI EAFE is a stock market index of foreign stocks, from the perspective of a North American investor. The index includes a selection of stocks from 21 developed markets, but excludes those form the U.S. and Canada. 0083-NLD-1/14/2010 EMERALD ASSET ADVISORS, LLC | 2843 Executive Park Drive | Weston, Florida 33331 | 954.385.9624 | 1.877.EAS.0757 info@EmeraldEAS.com | www.EASfunds.com 19
    • HEDGED INVESTING…in a flexible allocation mutual fund HEDGED INVESTING…in a flexible allocation mutual fund Medon A. Michaelides Jack F. Gonzalez Managing Partner Director of Business Development Leana C. Alu Sales & Marketing Assistant FUND MANAGER EMERALD ASSET ADVISORS, LLC www.EmeraldAssetAdvisors.com MARKETING & CLIENT SERVICE EMERALD ALLOCATION STRATEGIES, LLC 2843 Executive Park Drive Weston, Florida 33331 Telephone: 954.385.9624 www.EASfunds.com An investor should consider the Fund’s investment objective, risks, charges and expenses carefully before investing. This and other information about the EAS Genesis Fund is contained in the fund’s prospectus, which can be obtained by calling 1-877-EAS-0757 (1-877-327-0757). Please read the prospectus carefully before investing. The Fund is distributed by Northern Lights Distributors, LLC, member FINRA/SIPC. EMERALD ASSET ADVISORS, LLC | 2843 Executive Park Drive | Weston, Florida 33331 | 954.385.9624 | 1.877.EAS.0757 info@EmeraldEAS.com | www.EASfunds.com 20