CINCINNATI, March 7, 2017 /PRNewswire/ -- Touchstone Investments has named ClearArc Capital, Inc. (ClearArc) as its Sub-Advisor of the Year, recognizing the Cincinnati-based institutional investment advisor for its distinctive approach to seeking a high level of income from a dynamically managed, quality-oriented portfolio.
Touchstone employs a sub-advisor model that offers investors access to institutional asset managers whose strategies are typically not available to the average investor.
ClearArc serves as the sub-advisor to the Touchstone Flexible Income Fund. All 18 of Touchstone's sub-advisors were considered for the distinction, with the pool ultimately narrowed based on a variety of quantitative and qualitative factors.
"Our voters singled out ClearArc's proactive efforts, its engaging approach to supporting Touchstone's sales team, its consistent performance results and its truly unique income strategy that has attracted financial advisors," said Steven M. Graziano, president of Touchstone Investments.
"The fund has displayed low correlation1 to both stocks and bonds, while providing high levels of income in a predominantly high-quality portfolio. With this strategy, we can offer an alternative to traditional fixed income as well as many other niche income portfolios," Graziano added. "The firm's active use of preferred securities and its ability to hedge key risks have provided great benefit to shareholders. We look forward to continued success with ClearArc and the strategy as fixed-income markets continue to evolve."
ClearArc's seasoned investment team has worked together for more than a decade, employing a consistent process that has been effective in a variety of market environments. For this strategy, ClearArc operates with flexibility to tactically move between a variety of income producing asset classes while also seeking to add value with specific bottom-up security selections.
"We are very active in supporting Touchstone's efforts and will continue to focus on delivering attractive returns to fund shareholders while proactively managing the risks involved in investing for income," said ClearArc Capital President Stephen G. Mullins, CFA. "Touchstone's ability to provide an array of quality sub-advisory firms is well-regarded by institutional managers such as ourselves as well as by investors who rely on Touchstone for access to such distinctive strategies in mutual fund form."
1 Correlation is a statistical measure of how two securities move in relation to each other.
Performance data quoted represents past performance which is no guarantee of future results.
A Word About Risk
The Fund invests in equities which are subject to market volatility and loss. The Fund invests in debt securities which can lose their value as interest rates rise and are subject to credit risk which is the risk of deterioration in the financial condition of an issuer and/or general economic conditions that can cause the issuer to not make timely payments of principal and interest also causing the securities to decline in value and an investor can lose principal. When interest rates rise, the price of debt securities generally falls. Longer term securities are generally more volatile. The Fund invests in investment grade debt securities which may be downgraded by a Nationally Recognized Statistical Rating Organization (NRSRO) to below investment grade status. The Fund invests in non-investment grade debt securities which are considered speculative with respect to the issuers' ability to make timely payments of interest and principal, may lack liquidity and has had more frequent and larger price changes than other debt securities. The Fund invests in U.S. government and agency securities which are neither issued nor guaranteed by the U.S. Treasury and are not guaranteed against price movements due to changing interest rates. The Fund invests in mortgage-backed securities and asset-backed securities which are subject to the risks of prepayment, defaults, changing interest rates and at times, the financial condition of the issuer. The Fund invests in foreign securities which carry the associated risks of economic and political instability, market liquidity, currency volatility and differences in accounting standards. The Fund invests in preferred stocks which are relegated below bonds for payment should the issuer be liquidated. The fixed dividend may be less attractive in a rising interest rate market. The Fund invests in REITs; the risks are similar to those associated with direct ownership of real estate. Shareholders will indirectly bear the additional expenses of investing in REITs. The Fund invests in convertible securities which are subject to the risks of both debt securities and equity securities. The Fund invests in stocks of large-cap companies which may be unable to respond quickly to new competitive challenges. The Fund invests in stocks of small- and mid-cap companies, which may be subject to more erratic market movements than stocks of larger, more established companies. The Fund invests in value stocks which may not appreciate in value as anticipated or may experience a decline in value. The Fund invests in other investment companies such as closed-end funds and ETFs which are subject to substantially the same risks as those associated with the direct ownership of the securities comprising the portfolios; however, the price movements of the investment companies may not track the underlying securities or market index; the value of their shares may be lower than the value of the portfolio securities, and may be illiquid and shareholders will bear, indirectly, the additional expenses of investing in other investment companies. The Fund invests in derivatives such as forward currency exchange contracts, futures contracts, options and swap agreements. Derivatives can be highly volatile, illiquid and difficult to value, subject to counterparty and leverage risks and there is risk that changes in the value of a derivative held by the Fund will not correlate with the Fund's other investments. Gains or losses from speculative positions in a derivative may be much greater than the original cost and potential losses may be substantial. The Fund may experience higher portfolio turnover which may lead to increased fund expenses, lower investment returns and higher short-term capital gains taxable to shareholders. Current and future portfolio holdings are subject to risk. The advisor engages the sub-advisor to manage the Fund's portfolio; the sub-advisor's judgment may impact the Fund's performance.
Please consider the investment objectives, risks, charges and expenses of the Fund carefully before investing. The prospectus and the summary prospectus contain this and other information about the Fund. To obtain a prospectus or a summary prospectus, contact your financial advisor or download and/or request one at TouchstoneInvestments.com/literature-center or call Touchstone at 800.638.8194. Please read the prospectus and/or summary prospectus carefully before investing.
About Touchstone Investments
Touchstone Investments is a Distinctively Active mutual fund company committed to providing investors with access to institutional asset managers who act in a sub-advisory capacity. Managed by sub-advisors with high conviction, concentrated portfolios, Touchstone's entire equity fund lineup is composed of high Active Share funds which means their holdings are highly differentiated from their benchmarks. Touchstone's sub-advisor selection and monitoring approach is built upon the conviction that an asset manager's organizational stability, quality of its personnel, adherence to its investment discipline and infrastructure represent the elements of repeatable, value-added performance results over time. This philosophy has resulted in a diverse but focused product offering that gives investors a full breadth of investment options across styles and asset classes. The Touchstone Funds are advised by Touchstone Advisors, Inc., a registered investment advisor, and are distributed nationally through intermediaries including broker-dealers, financial planners and institutions by Touchstone Securities, Inc., a registered broker-dealer and member FINRA/SIPC. Touchstone, Touchstone Funds and Touchstone Investments are federal service mark registrations and applications owned by IFS Financial Services, Inc. Touchstone Securities, Inc., Touchstone Advisors, Inc. and IFS Financial Services, Inc. are members of Western & Southern Financial Group. For more information, please visit TouchstoneInvestments.com.
About ClearArc Capital
ClearArc Capital, Inc. (ClearArcCapital.com) provides investment strategies designed to meet the evolving needs of institutional clients. The firm offers a unique approach that includes research across capital structures in the search for income and return. Through specialized investment teams that are highly adaptive to today's markets, ClearArc Capital maintains a primary focus on client success.
ClearArc Capital, Inc. is an investment adviser registered under the Investment Advisers Act of 1940 and is a wholly owned subsidiary of Fifth Third Bank, with offices in Cincinnati, Grand Rapids, Mich., and Louisville, Ky. Registration as an investment adviser does not imply any level of skill or training.
Investment products offered are not FDIC insured, may lose value and have no bank guarantee.
Touchstone Funds are distributed by Touchstone Securities, Inc.*
*A registered broker-dealer and member FINRA/SIPC
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SOURCE Touchstone Investments