Morningstar rating as of February 29, 2020. Based on total return. Category: Options-based of 114 funds.
During global uncertainty managing asset allocation and downside risk with a defensive approach seeks to create value for investors
PHILADEPHIA, PA, March XX, 2020 – EAB Investment Group, a SEC Registered Investment Advisor providing a series of proprietary alpha generating and risk mitigating strategies to advisory clients, announced today that its sub-advised James Alpha Managed Risk Domestic Equity Fund (JDIEX) has been designated five stars by Morningstar (as of February 29, 2020).
EAB Investment Group implements a defensive and correlation management strategy that seeks to maximize risk adjusted returns over a full market cycle by limiting drawdowns in declining equity markets.
“The benefits of our systematic approach may be impactful to investor overall portfolio market correlation due to our focus on equity draw-down reduction. If investors are looking for impactful diversification, JDIEX may be a good solution,” said Arnim Holzer, Macro and Correlation Strategist of EAB. “We are pleased with the Fund’s five-star designation from Morningstar as it shows the value of our systematic risk mitigation approach for investors.”
Ed Boll, Managing Partner at EAB, added,” We are pleased with our fund’s performance and look forward to helping our clients reduce their draw-down risk. If the 12-year bull market is finally coming to an end, we believe our strategy is well positioned.” According to the Morningstar analysis, the funds 3-year downside capture ratio has been 20% compared to 64% category average. Additionally, the fund has a 3-year standard deviation of 4.18% as opposed to the category average of 8.6% and 13.16% for the S&P 500.
In February of this year, the firm also launched The EAB Correlation Defense Index (CDITM), a long short basket designed to provide returns negatively correlated to the S&P 500, that provides a third dimension of diversification during stress environments. For the last two years EAB has
been utilizing the CDI for client portfolios through options positioning and for risk signaling purposes. It is now available on Bloomberg terminals through their service (Bloomberg Ticker EABCDI).
About EAB Investment Group
EAB is an SEC registered investment company that provides a series of proprietary alpha generating and risk mitigating strategies for retail, institutional and family office investors. Headquartered in Philadelphia, PA, with offices in New York and Chicago, EAB is a sub-advisor on the James Alpha Managed Risk Emerging Markets Equity and Managed Risk Domestic Equity Fund. The firm works as a risk advisor and seeks to add value by developing strategy, product and hedging solutions using proprietary methods.
Alpha: The excess return of the fund relative to the return of the benchmark index is a fund’s alpha.
Downside Risk: An estimation of a security’s potential to suffer a decline in value if the market conditions change, or the amount of loss that could be sustained as a result of the decline. Downside risk explains a “worst case” scenario for an investment, or how much the investor stands to lose.
Drawdown: The peak-to-trough decline during a specific recorded period of an investment, fund or commodity.
Standard Deviation: measures historic volatility and is the measure of the dispersion of a set of data from its mean. The more volatile the data, the higher the deviation.
S&P 500 Index: An index of 500 stocks chosen for market size, liquidity and industry grouping, among other factors. The S&P 500 is designed to be a leading indicator of U.S. equities and is meant to reflect the risk/return characteristics of the large cap universe.
Risks and Disclosures
The primary investment objective of the Portfolio is capital appreciation.
Rankings are only one form of performance measurement. For current performance information, please call toll free (888)814-8180.
The portfolio will borrow money for investment purposes. Leveraging investments, by purchasing securities with borrowed money, is a speculative technique that increases investment risk while increasing investment opportunity. Derivatives may be volatile, and some derivatives have the potential for loss that is greater than the Portfolio’s initial investment. If the Portfolio sells a put option, there is risk that the Portfolio may be required to buy the underlying investment at a disadvantageous price. If the Portfolio purchases a put option or call option, there is risk that the price of the underlying investment will move in a direction that causes the option to expire worthless. The Portfolio’s ability to achieve its investment objective may be affected by the risk’s attendant to any investment in equity securities.
The securities of issuers located in emerging markets tend to be more volatile and less liquid than securities of issuers located in more mature economic structures and less stable political systems than those developed countries. Shares of ETFs have many of the same risks as direct investments in common stocks or bonds. In addition, their market value is expected to rise and fall as the value of the underlying index or bond rises and falls. It is possible that the hedging strategy could result in losses and/or expenses that are greater than if the Portfolio did not include the hedging strategy.
The use of leverage by the Fund or an Underlying Fund, such as borrowing money to purchase securities or the use of derivatives, will indirectly cause the Fund to incur additional expenses and magnify the Fund’s gains or losses. Because a large percentage of the Portfolio’s assets may be invested in a limited number of issuers, a change in the value of one or a few issuers’ securities will affect the value of the Portfolio more than would occur in a diversified fund.
Past performance is not a guarantee or a reliable indicator of future results. Investors cannot directly invest in an index and unmanaged index returns do not reflect any fees, expenses, or sales charges. As with any investment, there are risks. There is no assurance that the portfolio will achieve its investment objective. Mutual funds involve risk, including possible loss of principal. Certain members of James Alpha Advisors, LLC are also registered representatives of FDX Capital, LLC, member FINRA/SIPC. Saratoga Capital Management, LLC, FDX Capital, LLC and EAB Investment Group, LLC are not affiliated with Northern Lights Distributors. The Saratoga Advantage Trust’s Funds are distributed by Northern Lights Distributors, LLC, member FINRA/SIPC. 11/11 © Saratoga Capital Management, LLC; All Rights Reserved.
Investors should carefully consider the investment objectives, risks, charges and expenses of the Fund. This and other information is contained in the Fund’s prospectus, which can be obtained by calling 888.814.8180 and should be read carefully before investing. Additional Fund literature may be obtained by visiting www.SaratogaCap.com or www.JamesAlphaAdvisors.com.
THIS PRESS RELEASE CONTAINS FORWARD-LOOKING STATEMENTS WITHIN THE MEANING OF THE PRIVATE SECURITIES LITIGATION REFORM ACT OF 1995 AND OTHER FEDERAL SECURITIES LAWS. THESE FORWARD-LOOKING STATEMENTS ARE BASED UPON THE FUND’S PRESENT BELIEFS AND EXPECTATIONS, BUT THEY ARE NOT GUARANTEED TO OCCUR AND MAY NOT OCCUR FOR NUMEROUS REASONS, SOME OF WHICH ARE BEYOND THE FUND’S CONTROL. THE FUND CAN PROVIDE NO ASSURANCE THAT ITS FUTURE EARNINGS WILL BE SUFFICIENT TO ENABLE THE FUND TO PAY A REGULAR QUARTERLY DISTRIBUTION. THE DIVIDENDS WHICH THE FUND HAS RECEIVED FROM ITS INVESTMENTS IN REITS MAY BE CHARACTERIZED BY THOSE REITS DIFFERENTLY THAN THE FUND NOW EXPECTS. FOR THIS REASON, AMONG OTHERS, SOME OF THE DISTRIBUTION DESCRIBED IN THIS PRESS RELEASE MAY CONSIST OF CAPITAL GAINS OR RETURN OF CAPITAL.
FOR THESE AND OTHER REASONS, INVESTORS SHOULD NOT PLACE UNDUE RELIANCE UPON FORWARD LOOKING STATEMENTS.
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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.
Morningstar Rating is for the I share class only; other classes may have different performance characteristics.