Systematic Mid Cap Value Fund

Systematic Financial Management’s bottom-up process starts with a quantitative screen of companies with market capitalizations between $1 billion and $15 billion. These companies are then ranked by a combination of valuation factors and positive earnings surprise. This screening process generates a research focus list of 150 companies meriting rigorous fundamental analysis to confirm each stock’s value and catalyst for appreciation. The research process incorporates investor expectations, financial statement analysis, thorough company valuation analysis, and fundamental due diligence. This multi-faceted research process enables them to avoid stocks in the “value trap,” by focusing only on companies with confirmed fundamental improvement as evidenced by a genuine positive earnings surprise. Through an extensive cash flow analysis, they verify the sustainability of the earnings surprise (i.e., derived from consistent operations versus erratic favorable events).

Ideal Investment

• Low forward P/E
• Improving margins
• Strong cash flow generation
• Strong business models and strong earnings generation
• Excellent potential for continued positive earnings surprises

Portfolio Construction

Portfolio management:

• Leverages stock ideas from their in depth research analysis
• Employs a bottom-up process based on individual security selection

Sell Discipline

• Price appreciation causes P/E expansion to fair value
• Price appreciation causes market capitalization of the company to appreciate beyond the definition of a mid-cap company 
• There are other investment opportunities that are more attractive on a relative valuation and expected return basis
• Analysis leads portfolio management to anticipate downward estimate revisions or a possible negative earnings surprise
• There is a reported negative earnings surprise

Investment Process Chart

Investors should carefully consider the fund's investment objectives, risks, charges, and expenses before investing. For this and other information, please call 800.835.3879 or download a free prospectus. Read it carefully before investing or sending money.

The performance shown represents past performance and is not a guarantee of future results. Current performance may be lower or higher than the performance data quoted. The investment return and the principal value of an investment will fluctuate so that an investor’s shares, when redeemed, may be worth more or less than their original cost. From time to time the advisor has waived fees or reimbursed expenses, which may have resulted in higher returns. The listed returns and yields on the Fund are net of expenses and the returns and yields on the indices exclude expenses. Current performance of the Fund may be lower or higher than the performance quoted.

There is no guarantee that these investment strategies will work under all market conditions, and each investor should evaluate their ability to invest for a long-term, especially during periods of downturns in the market.

The investment return and the principal value of an investment will fluctuate so that an investor's shares, when redeemed, may be worth more or less than their original cost.