What were the Fund’s costs for the last year?

(based on a hypothetical $10,000 investment)

Asset Weighting (% of total investments)

Asset Weighting (% of total investments)

Material Fund Changes

No material changes occurred during the year ended August 31, 2026. 

How did the Fund perform during the reporting period? 

Market Conditions:

• Performance: For the twelve-month period ended August 31, 2026, the S&P 500 Index advanced amid resilient corporate earnings and continued enthusiasm surrounding artificial intelligence, despite intermittent volatility tied to monetary policy uncertainty, rising Treasury yields, a softening labor market, and geopolitical developments. The Fund used tactical hedging and active exposure management to navigate market dislocations and changing macroeconomic conditions. By adjusting portfolio exposures and risk levels as conditions evolved, the Fund sought to limit downside participation while maintaining selective exposure to equity-market advances.

• Volatility: The market experienced notable volatility throughout the period when geopolitical concerns and shifting rate expectations led to sharp intra-month movements. The S&P 500 Index had a higher daily standard deviation of 0.81%, compared to the Fund’s daily standard deviation of 0.74%, indicating more pronounced fluctuations in the broader market.

• Economic Indicators: Economic growth moderated amid persistent inflation and a stable labor market. The Federal Reserve lowered its target rate in September 2025 as job growth slowed, then held rates steady through August 2026 while monitoring inflation and economic activity. In August 2026, nonfarm payrolls increased by 162,000, unemployment remained at 4.1%, and inflation stayed above the Federal Reserve’s long-term target. Shifting policy expectations, economic data, and geopolitical developments contributed to periodic market volatility.

Investment Strategies and Techniques:

• Long-Short Equity Strategy: The Fund employed a long-short equity strategy that used futures to hedge portfolio risk and dynamically adjust market exposure. Exposure levels were increased or reduced in response to underlying market trends and changes in volatility, allowing the Fund to adapt as market conditions evolved.

• Risk Management: The Fund’s emphasis on disciplined risk management through diversification and strategic hedging helped preserve capital during periods of market turbulence. However, this prudent approach also tempered upside participation during swift market rebounds driven by headline-driven sentiment shifts.

Summary

Despite challenging market conditions, the Fund generated a positive return through strategic positioning and disciplined risk management. Although the S&P 500 Index delivered a higher absolute return, the Fund’s lower standard deviation reflected less volatility and a more stable return pattern during the period. This result underscores the Fund’s focus on balancing return opportunities with disciplined risk management amid heightened uncertainty.

Fund Statistics 

• Net Assets$114,980,360
• Number of Portfolio Holdings3
• Advisory Fee (net of waivers)$2,289,797
• Portfolio Turnover0%

Top 10 Holdings (% of net assets)

What were the Fund’s costs for the last year?

(based on a hypothetical $10,000 investment)

Asset Weighting (% of total investments)

Asset Weighting (% of total investments)

Material Fund Changes

No material changes occurred during the year ended August 31, 2026. 

How did the Fund perform during the reporting period? 

Market Conditions:

• Performance: The Bloomberg U.S. Aggregate Bond Index experienced a total return of 1.89% over the reporting period. The Fund had a total return of 1.34%, trailing the benchmark.

• Volatility: The U.S. Bond market experienced notable fluctuations, with the Bloomberg U.S. Aggregate Bond Index posting a daily standard deviation of 0.23%. In comparison, the Fund maintained a slightly higher volatility at 0.47%, reflecting its more active approach. However, the Fund’s beta of 0.46 and low correlation of 0.23 to the benchmark indicate limited sensitivity to broader market movements, contributing to a differentiated risk-return profile.

Investment Strategies and Techniques:

• Dynamic Investment Exposure: The Fund’s exposure was actively managed through a diversified mix of ETFs and index-based derivatives. This dynamic allocation strategy focused on capturing income opportunities while managing volatility and downside risk. Tactical shifts were made in response to macroeconomic developments and market dislocations, allowing the Fund to remain agile and responsive.

• Risk Management: The Fund employed advanced risk management techniques, including diversification across asset classes and sectors, regular stress testing, and the use of index-based derivatives to hedge against market volatility. These strategies helped to protect capital and maintain stability during periods of market turbulence.

Summary

During the reporting period, the Bloomberg U.S. Aggregate Bond Index returned 1.89%, compared with 1.34% for the Fund. Fixed income markets were shaped by shifting interest-rate expectations, persistent inflation, and changing economic data. Against this backdrop, the Fund’s dynamic investment exposure and active allocation across ETFs and index-based derivatives supported positive performance while maintaining a differentiated approach to traditional bond-market exposure.

In an uncertain market environment, the Fund’s flexible allocation, diversification, and disciplined risk management may complement traditional fixed income holdings. The strategy remained focused on identifying income opportunities, responding to changing market conditions, and managing downside risk while seeking competitive long-term returns.

Asset Weighting (% of total investments)

Asset Weighting (% of total investments)

Material Fund Changes

No material changes occurred during the year ended August 31, 2026.