HUNTINGTON, N.Y.--(BUSINESS WIRE)--Rational Funds, a family of funds rooted in the investment philosophy of applying a rational approach to investing, recently announced the conversion of the Rational Real Strategies Fund into the Rational Hedged Return Fund (Tickers: HRSAX, HRSFX, HRSTX). HRSTX is now sub-advised by Warrington Asset Management LLC and implements an options-based strategy that primarily invests in long and short call and put options on futures contracts on the S&P 500 Index.
“The Rational Hedged Return Fund relies on a proven investment strategy previously offered only as a separately managed account,” commented Scott Kimple, Portfolio Manager of HRSTX. The Fund seeks total return consisting of long-term capital appreciation and income. The Fund seeks to achieve its objective through premium collection from options, volatility trading designed to hedge or profit from either an increase or a decrease in S&P 500 index volatility, and trend following.
“We believe that the traditional asset allocation model of long-only stocks and bonds does not adequately position investors’ portfolios for the risks and opportunities in today’s global markets,” said Jerry Szilagyi, CEO of Rational Funds. “We are excited to partner with Warrington Asset Management to manage the Rational Hedged Return Fund with a strategy designed to produce returns that are not correlated with equity market returns.”
For more information on the Fund and on Rational Funds, please visit: www.rationalmf.com or call (800) 253-0412.
About Rational Funds
Rational Funds is a family of funds rooted in the investment philosophy of applying a rational approach to investing. Rational Funds currently offers seven mutual fund products, which employ rigorous research backed by sound academic theory, and a disciplined and systematic investment approach. The funds strive to deliver superior risk-adjusted returns, at the apex of successful modern portfolio strategies for today’s investor. For more information on Rational Funds and its mutual fund products, please visit: www.rationalmf.com.
Investors should carefully consider the investment objectives, risks, charges and expenses of the Rational Funds. This and other important information about the Fund is contained in the prospectus, which can be obtained by calling (800) 253-0412 or at www.RationalMF.com. The prospectus should be read carefully before investing. The Rational Funds are distributed by Northern Lights Distributors, LLC member FINRA/SIPC. Rational Advisors, Inc. is not affiliated with Northern Lights Distributors, LLC.
Investing in the Fund carries certain risks. The value of the Fund may decrease in response to the activities and financial prospects of an individual security in the Fund’s portfolio. The Fund’s use of stock index futures involves risks different from, or possibly greater than, the risks associated with investing directly in securities and other traditional investments. These risks include (i) leverage risk (ii) risk of mispricing or improper valuation; and (iii) the risk that changes in the value of the futures contract may not correlate perfectly with the underlying index. Investments in futures involve leverage, which means a small percentage of assets invested in futures can have a disproportionately large impact on the Fund. Hedging is a strategy in which the Fund uses options or futures to offset the risks associated with other Fund holdings. There can be no assurance that the Fund’s hedging strategy will reduce risk or that hedging transactions will be either available or cost effective. The Fund is not required to use hedging and may choose not to do so. The use of leverage by the Fund, such as the use of options or futures, will cause the Fund to incur additional expenses and magnify the Fund's gains or losses. There are risks associated with the sale and purchase of call and put options. As the buyer of a put or call option, the Fund risks losing the entire premium invested in the option if the Fund does not exercise the option. As a seller (writer) of a put option or call option, the Fund will lose money if the value of the stock index futures falls below or rises above the respective option’s strike price. The Fund's losses are potentially large in a written put transaction and potentially unlimited in an unhedged written call transaction. Changes in the laws or regulations of the United States, including any changes to applicable tax laws and regulations, could impair the ability of the Fund to achieve its investment objective and could increase the operating expenses of the Fund. The Fund may invest in U.S. government or agency obligations. Securities issued or guaranteed by federal agencies and U.S. government sponsored entities may or may not be backed by the full faith and credit of the U.S. government. Liquidity risk exists when particular investments of the Fund would be difficult to purchase or sell, possibly preventing the Fund from selling such illiquid securities at an advantageous time or price, or possibly requiring the Fund to dispose of other investments at unfavorable times or prices in order to satisfy its obligations.