KL Allocation Fund Earns 5-Star Rating from Morningstar
Ranks No. 1 in Category for 1-Year Total Return During Biggest Market Drawdown in a Decade
24 Apr, 2020, 13:58 ET
DENVER, April 24, 2020 /PRNewswire/ -- Knowledge Leaders Capital today announced the KL Allocation Fund (GAVIX) earned Morningstar's 5-star rating for all rated time periods. The rating is based on risk-adjusted return for the 3- and 5-year periods and overall compared to 396, 329 and 396 funds respectively in the Morningstar World Allocation category as of 3/31/20. In addition, the fund ranked No. 1 of all 486 peers for 1-year total return during a period that included the biggest market drawdown in a decade, as of 3/31/20.
"We aim to deliver returns by making fewer errors than the market," said Knowledge Leaders Capital Chief Investment Officer Steven Vannelli, CFA. "During the first quarter, we liquidated our entire position in long-term US Treasury bonds at all-time low yields in February, and then in mid-March, increased our exposure to Knowledge Leader equities when valuations became more attractive. As a result, we were able to lock in a significant lead with a positive return of 1.36% during Q1 when the benchmark was down -21.37%."
Indeed, as of 3/31/20, the KL Allocation Fund bested the benchmark MSCI All Country World Index in all standard performance time periods, including one year (8.37% vs. -11.26%), three years (3.92% vs. 1.50%), five years (3.71% vs. 2.85%) and since inception (6.92% vs. 6.14%), annualized.
The KL Allocation Fund has demonstrated a long-term history of avoiding significant percentages of every one of the 17 major selloffs in the MSCI ACWI since the fund's inception in 2010, as of 3/31/20. For example, during the most recent drawdown from the high date of 2/12/20 to the low date of 3/20/20, the MSCI ACWI was down -31.48% while the fund was down -8.64%, a difference of 22.84%, meaning the fund avoided 75.54% of the drawdown. Previously, during the two drawdown periods in 2019 (5/3/19-5/31/19 and 7/24/19-8/15/19, during which the MSCI ACWI was down -5.96% and -6.24%), the fund generated positive performance, avoiding 112.64% and 126.83% of the drawdowns, respectively. (For a complete history of the fund's record during significant drawdowns see Moneyball Investing White Paper.)
These results suggest the KL Allocation Fund may help investors improve portfolio performance, portfolio efficiency and downside protection. The fund's inception date is 9/30/2010, and it is on track to mark the 10-year performance milestone later this year. Learn more about the KL Allocation Fund. Read the most recent Performance Update & Commentary. Contact Shawn Paulk at [email protected] or 704.844.6844.
Please consider the Fund's investment objectives, risks, charges and expenses carefully before investing. The prospectus or summary prospectus that contains this and other information about the Fund, is available by calling 888.998.9890 and should be read carefully.
Short-term performance is not an indicator of future performance or returns. Short-term performance should not be relied upon as the sole basis in deciding to invest in the KL Allocation Fund or any investment product.
The performance data quoted here represents past performance. Past performance is no guarantee of future results. Investment return and principal value will fluctuate, so that an investor's shares, when redeemed, may be worth more or less than their original cost. Current performance may be lower or higher than the performance information quoted. To obtain performance information current to the most recent month-end please call 888.998.9890 or visit our website at www.KnowledgeLeadersFunds.com. The total annual operating expenses of the Fund are 1.49% and 1.24% for the Advisor and Institutional Classes, respectively. The inception date for the KL Allocation Fund is 9/30/10.
About the Knowledge Leaders Strategy
The Knowledge Leaders Strategy seeks to transform the Knowledge Effect into portfolio alpha. Knowledge Leaders Capital identifies Knowledge Leaders, or highly innovative companies, by measuring a company's investment in its future growth. Knowledge Leaders possess deep reservoirs of intangible capital as a result of their history of investing in knowledge-intensive activities like R&D, brand development and employee education. Developed by founder Steven Vannelli and based on decades of academic research, the firm's proprietary model adjusts a company's financial history to capitalize these investments and reveal the companies with the greatest knowledge intensity.
About Knowledge Leaders Capital
Knowledge Leaders Capital identified the Knowledge Effect and created the first investment methodology designed to capture the excess returns of highly innovative companies. Knowledge Leaders Capital is creator and designer of the Knowledge Leaders Strategy, indexes and investment products. Learn more about the KL Allocation Fund and the Knowledge Leaders Developed World ETF. Follow the Knowledge Leaders Funds on Twitter @KL_Alloc_Fund and @KLDWETF. Email us at [email protected].
The Advisor has contractually agreed to waive its fees and/or pay for operating expenses of the Fund to ensure that the total annual fund operating expenses (excluding any taxes, leverage interest, brokerage commissions, dividend and interest expenses on short sales, acquired fund fees and expenses (as determined in accordance with Form N-1A), expenses incurred in connection with any merger or reorganization, and extraordinary expenses such as litigation expenses) do not exceed 1.49% and 1.24% of the average daily net assets of Advisory Class and Institutional Class shares of the Fund, respectively. This agreement is in effect until December 31, 2020, and it may be terminated before that date only by the Trust's Board of Trustees.
Past performance is no guarantee of future results. Ratings may reflect fee waivers in effect; in their absence, ratings may have been lower. Ratings for other share classes may vary. As of 3/31/20, the KL Allocation Fund was rated against the following numbers of U.S.-domiciled World Allocation funds over the following time periods: 396 funds in the last three years, 329 funds in the last five years and 396 funds overall. With respect to these World Allocation funds, the KL Allocation fund received a Morningstar Rating of 5 stars for the 3-year, 5-year and overall periods.
Max Drawdown is the maximum single period loss incurred over the interval being measured. Alpha is a measure of the portfolio's risk adjusted performance. When compared to the portfolio's beta, a positive alpha indicates better-than-expected portfolio performance and a negative alpha worse-than-expected portfolio performance. The MSCI All Country World Index is a free float-adjusted market capitalization weighted index that is designed to measure the equity market performance in 46 developed and emerging markets.
©2020 Morningstar, Inc. All Rights Reserved. The information contained herein: (1) is proprietary to Morningstar; (2) may not be copied or distributed; and (3) is not warranted to be accurate, complete or timely. Neither Morningstar nor its content providers are responsible for any damages or losses arising from any use of this information. Past performance is no guarantee of future results.
The Morningstar RatingTM for funds, or "star rating", is calculated for managed products (including mutual funds, variable annuity and variable life subaccounts, exchange-traded funds, closed-end funds, and separate accounts) with at least a three-year history. Exchange-traded funds and open-ended mutual funds are considered a single population for comparative purposes. It is calculated based on a Morningstar Risk-Adjusted Return measure that accounts for variation in a managed product's monthly excess performance, placing more emphasis on downward variations and rewarding consistent performance. The Morningstar Rating does not include any adjustment for sales loads. The top 10% of products in each product category receive 5 stars, the next 22.5% receive 4 stars, the next 35% receive 3 stars, the next 22.5% receive 2 stars, and the bottom 10% receive 1 star. The Overall Morningstar Rating for a managed product is derived from a weighted average of the performance figures associated with its three-, five-, and 10-year (if applicable) Morningstar Rating metrics. The weights are: 100% three-year rating for 36-59 months of total returns, 60% five-year rating/40% three-year rating for 60-119 months of total returns, and 50% 10-year rating/30% five-year rating/20% three-year rating for 120 or more months of total returns. While the 10-year overall star rating formula seems to give the most weight to the 10-year period, the most recent three-year period actually has the greatest impact because it is included in all three rating periods.
The KL Allocation Fund is distributed by IMST Distributors, LLC.
An investor cannot invest directly in an index.
SOURCE Knowledge Leaders Capital
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