Strategy. The Fund aims to provide a higher return, lower-risk alternative with minimal tracking error to a long-only S&P 500 Index. The Fund aims to achieve its investment objective by combining two complementary investment strategies: ? A long-only equity portfolio designed to approximate the performance of the S&P 500 Index (the ?Equity Component?), and ? An overlay component (the ?Overlay Component?) designed to reduce risk and enhance return that makes investments in futures, forwards, options contracts and foreign currency via Foreign Exchange (?FX?). The Equity Component: Under normal circumstances, the Fund invests at least 80% of its net assets in the ?Equity Component.? The Fund endeavors to maintain the majority of its equity exposure through the use of exchange-traded Funds (?ETFs?) … Show more… The Fund aims to provide a higher return, lower-risk alternative with minimal tracking error to a long-only S&P 500 Index. The Fund aims to achieve its investment objective by combining two complementary investment strategies: ? A long-only equity portfolio designed to approximate the performance of the S&P 500 Index (the ?Equity Component?), and ? An overlay component (the ?Overlay Component?) designed to reduce risk and enhance return that makes investments in futures, forwards, options contracts and foreign currency via Foreign Exchange (?FX?). The Equity Component: Under normal circumstances, the Fund invests at least 80% of its net assets in the ?Equity Component.? The Fund endeavors to maintain the majority of its equity exposure through the use of exchange-traded Funds (?ETFs?) and/or common stocks. The Fund may choose to obtain the remainder of its equity exposure through the use of futures and options contracts. The Fund?s Equity Component investments are made on a relatively passive and long-only basis. If investing directly in common stocks, R. G. Niederhoffer Capital Management, Inc., the Fund?s investment sub-advisor (the ?Sub-Advisor?) will use a near replication methodology, meaning it seeks to invest in most or all of the companies comprising the Index in near proportion to the weightings in the S&P 500 Index. The S&P 500 Index is a stock market index tracking the stock performance of 500 of the largest companies listed on stock exchanges in the United States. The Overlay Component: The remaining assets of the Fund are invested in the ?Overlay Component,? either directly or via an investment in one or more wholly-owned Subsidiaries (as described below) in which up to a total of 25% of the Fund?s total assets may be invested. The Fund and its Subsidiaries may also hold assets in cash, money market mutual funds, U.S. Treasury Securities, and other cash equivalents, some or all of which will serve as margin or collateral for the Fund?s investments. The Overlay Component aims to enhance the Fund?s return and to protect the downside risk of the Equity Component?s equity exposure to the S&P 500 Index by: ? providing risk reduction during declining periods for equities; ? achieving profits during volatile directionless periods for equities; and ? enhancing returns during rising periods for equities. To accomplish this, the Overlay Component makes long and short investments in various domestic and international instruments (the ?Instruments?) using a proprietary, quantitative investment strategy. These Instruments include Foreign Exchange (FX) currency and forward contracts, exchange-traded commodity and financial futures contracts in domestic and foreign markets, exchange-traded option contracts in domestic and foreign markets, individual common stocks, ETFs, liquid Sovereign Debt instruments, and liquid interest-rate swaps. The Sub-Advisor invests the Overlay Component assets using a systematic tactical investment strategy combining ?mean-reversion,? ?short-term momentum,? and ?trend-following.? ?Mean-reversion? trading refers to investments made in the opposite direction to a recent market move, in anticipation that the market will return to its original price level. ?Short-term momentum? trading refers to investments made in the same direction as a recent market move, with the expectation that the market move will continue in the same direction for a relatively short period of time (hours to days), after which the trade will be exited. ?Trend-following? refers to a similar type of momentum-based trading where trades are made anticipating that the price move will continue in the same direction for a few hours to a few days. However, ?trend-following? trades typically last longer than ?short-term momentum? trades, and often capture market moves lasting weeks or longer in duration. Investments are generally automatically selected and implemented using a combination of numerous quantitative trading rules that have been developed by the Sub-Advisor over its history of operation since 1993. The Sub-Advisor engages in an extensive research effort to evaluate and enhance its quantitative trading strategy, and often adds, modifies, and improves its trading rules, techniques, algorithms, calculations, execution strategies, and other aspects of its operation. These rules identify repeating patterns of non-random market behavior using a proprietary software platform and a decades-long database of intraday futures, equity and commodity price data, as well as other data. Under normal circumstances, most investments will typically be held for a period of a few hours to 1-2 weeks, rather than months to quarters at a time as is often the case in approaches such as long-term trend-following. The Fund?s position sizes, its risk levels, and maximum and minimum exposure levels are determined based on factors such as liquidity, volatility, covariance, the historical tendency of the portfolio to rise or fall depending on the movement of stocks, interest rates, and other major markets, macroeconomic factors, and historical and potential price behavior. While the Sub-Advisor?s strategy is primarily systematic, the Sub-Advisor may on certain occasions employ human discretionary methods for trading and risk management, particularly during unusual market periods. These discretionary decisions, when they do occur, often involve taking steps to reduce the risk of the strategy. Because of the Fund?s active trading strategy, its higher trading volume may lead to higher transaction costs that may affect the Fund?s performance. Investments in Subsidiary The Sub-Advisor executes a portion of the Fund?s strategy by investing up to 25% of its total assets in a wholly owned and controlled subsidiary (the ?Subsidiary?). The Subsidiary invests the majority of its assets in commodity future contracts and other derivative contracts. The Subsidiary is subject to the same investment restrictions as the Fund, when viewed on a consolidated basis. The Subsidiary is RRDEF Fund Limited, a Cayman Islands company. The Subsidiary is advised by the Fund?s Advisor and sub-advised by the Sub-Advisor. The Fund is classified as ?non-diversified? for purposes of the Investment Company Act of 1940 (the ?1940 Act?), which means a relatively high percentage of the Fund?s assets may be invested in the securities of a limited number of issuers. Show less