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INVESTMENT OBJECTIVE & STRATEGIES:
Investment Objective
The investment objective of the Marathon Value Portfolio
(the “Fund”) is to provide shareholders with long-term
capital appreciation in a well-diversified portfolio. The
Fund will measure its performance against the Standard &
Poor’s 500 Index®. It will benchmark both relative
performance and volatility against that measure.
Principal Strategies
The Fund primarily will provide the investor broad exposure
to what the Fund’s advisor, Spectrum Advisory Services,
Inc., believes are the best opportunities or values in
common stocks of U.S. companies. These opportunities or
values typically will be stocks of companies that, in the
advisor’s opinion, do not reflect the intrinsic value of the
companies.
The advisor intends that the Fund will invest primarily in
common stocks of U.S. companies that have potential “value”
in the advisor’s judgment. The advisor believes that
determining value involves an effort to understand a
company’s assets and business strengths and to compare those
to the current price of the company’s stock. It is worth
noting that in today’s economy, assets are often intangible.
A value investor does not place great emphasis on precise
projections of future earnings or on the current momentum of
the company’s business. The advisor will not exclude great
companies that sell at reasonable prices relative to their
value. The advisor intends for the Fund to provide investors
with exposure to a wide number of industries.
In valuing a company, the advisor takes a long-term
approach, with an emphasis on management strength and the
fundamental profitability of the company’s business. To
assess management strength, the advisor looks for
characteristics such as a long-term record of success or
positive opinions from industry observers. The advisor seeks
companies whose businesses possess, in the advisor’s
opinion, inherent strength based on factors such as superior
production or distribution processes, unique products or
quality franchises. The Fund may also purchase a company’s
stock if the advisor’s assessment of the private market
value of the company (i.e., the price at which knowledgeable
buyers and sellers would exchange a comparable business)
exceeds, by a material amount, the price of the security.
The advisor’s assessment of private market value is based on
reported similar transactions, information in industry
publications or from individuals within the industry, or
other sources of information.
The Fund may invest in short-term and long-term debt
securities, preferred stocks, convertible debt securities
and convertible preferred stocks. The Fund may invest in
lower-rated debt securities of a company if the advisor
believes that the company’s junk bonds offer more potential
for participating in the company’s long-term prospects than
could be achieved by investing in the company’s other
available securities. The Fund also may invest up to 10% of
its assets in junk bonds rated at the time of purchase BB/Ba
or lower by S&P or Moody’s or, unrated, but determined to be
of comparable quality by the advisor. The Fund also may
invest up to 10% of its assets in equity securities of
foreign issuers, including American Depositary Receipts
(“ADRs”). ADRs are certificates held in trust by a U.S. bank
or trust company evidencing ownership of shares of
foreign-based issuers, and are an alternative to purchasing
foreign securities in their national market and currency.
The Fund intends to remain substantially invested in value
securities. If, however, the advisor believes that
sufficient investment opportunities that meet the Fund's
investment criteria are not available, the Fund may invest
up to 20% of its total assets in money market funds,
investment grade short-term money market instruments
including U.S. Government and agency securities, commercial
paper, certificates of deposit, repurchase agreements and
other cash equivalents. The Fund will incur duplicate
management and other fees when investing in money market
funds. By keeping cash on hand, the Fund may be able to meet
shareholder redemptions without selling stocks and realizing
gains and losses. However, the Fund may not achieve its
investment objective when holding a substantial cash
position.
The advisor believes its price-driven, value-oriented
approach will provide investors with the opportunity for
growth, while providing some protection against permanent
impairment of capital. The advisor seeks to reduce risk by
buying stocks the advisor believes are reasonably priced
relative to the company’s earnings and sales, by
diversifying broadly and by avoiding current market
favorites. The advisor’s decision to purchase a stock is
made without regard to the market capitalization of the
company or its weighting in any market index. The Fund may
invest in companies of all sizes, which includes large,
mid-cap, and small-cap securities.
The Fund may sell a security when the advisor believes the
price is no longer undervalued relative to the company’s
earnings and sales, the company’s prospects have
deteriorated, there has been a change in management, or
better investment opportunities are available.
You should carefully consider the investment objectives,
potential risks, management fees, and charges and expenses
of the Fund before investing. The Fund's
Prospectus contains
this and other information about the Fund, and should be
read carefully before investing. You may obtain a current
copy of the Fund's
Prospectus by calling 1-800-788-6086.
The Fund's past performance does not guarantee future
results. The investment return and principal value of an
investment in the Fund will fluctuate so that an investor's
shares, when redeemed, may be worth more or less than their
original cost. Current performance of the Fund may be lower
or higher than the performance quoted. Performance data
current to the most recent month end may be obtained by
calling 1-800-788-6086.
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