The Adviser seeks to achieve the total return portion of the Fund’s investment objective by using a dynamic macro (top-down) and micro (bottom-up) approach to invest in a broad range of asset classes and individual investments, allowing the Fund to pursue any and all investment opportunities.

The Fund may invest in or seek exposure to a wide range of asset classes including, without limitation: (i) equities (of any market capitalization); (ii) fixed-income securities (including asset-backed securities, mortgage-backed securities and other collateralized obligations and all grades and maturities of domestic and foreign (including emerging markets) credit, including high yield (junk bonds)); (iii) commodities; (iv) real estate investment trusts (“REITs”); (v) currencies and (vi) options. The Adviser’s strategy seeks long and short exposure in these various asset classes and currencies, depending on the risk/reward.

The Fund may take long or short positions in the asset classes identified above either directly or indirectly through investments in exchange-traded funds (“ETFs”), exchange-traded notes (“ETNs”) and derivative instruments such as, but not limited to, futures, swaps, options and currency forward contracts. The Fund may take short positions indirectly through investments in ETFs or ETNs, including inverse ETFs (funds that are designed to rise in price when stock prices are falling) or ETNs and derivative instruments (listed above) that are intended to provide inverse exposure to a particular asset class or currency. The Fund may also invest in leveraged ETFs. Long positions and short positions may be taken to enhance expected return, reduce expected risk or both. The Adviser expects the Fund’s net long exposure to typically be between 70% and 110% of total net assets, but it may range from -100% to 225% of total net assets over a short time horizon while an active directional exposure is being applied.

The Fund may invest in (i) futures contracts  typically based on, but not limited to, equity indexes, government bonds, commodities and currencies; (ii) swaps typically on, but not limited to, equity indexes, including custom equity indexes, equity index volatility/variance, government bonds, credit default indexes, inflation, commodities and commodity indexes; and (iii) options typically on, but not limited to, equity indexes, equity index futures, government bonds, government bond futures and currencies.

The Fund has no geographic or other limits on the allocation of its assets among asset classes, although it focuses on areas and regions predominantly in North America.

The Adviser seeks to achieve the capital preservation portion of the Fund’s investment objective by using active risk management techniques to hedge net exposure through options, ETFs and individual equities.

The Adviser’s asset allocation strategy is based primarily on the fundamental investment valuations of various asset classes. The Adviser’s goal is to identify large periodic discrepancies between fundamental values and market prices, actively shift between long or short positions, as well as allocate to cash and seek to capitalize on opportunities within and among the capital markets of the world.

The Adviser generally purchases, or shorts, a security when the market price is below or above the intrinsic valuation and the risk-reward profile is relatively more attractive than other opportunities. The Adviser generally sells a security when it believe its relative attractiveness has deteriorated, its valuation becomes excessive or risk associated with the security has increased significantly. In addition, the Adviser may sell a security if better investment opportunities emerge elsewhere.

The Adviser evaluates investments on a relative valuation basis and determine when investments are under-valued or over-valued based on proprietary measures.