Strategy. Under normal market conditions, the Fund invests at least 80% of its net assets (including investment borrowings) in a portfolio of fixed income securities. The Funds investment sub-advisor, Smith Capital Investors, LLC ( Smith Capital or the Sub-Advisor ), manages the Funds portfolio in an unconstrained manner, meaning that its investment universe is not limited to the securities of any particular index and it has discretion to invest in fixed income securities of any type or credit quality, including up to 70% of its net assets in high yield (or junk) securities, up to 25% of its net assets in securities issued by issuers with significant ties to emerging market countries and up to 10% of its net assets in … Show more… Under normal market conditions, the Fund invests at least 80% of its net assets (including investment borrowings) in a portfolio of fixed income securities. The Funds investment sub-advisor, Smith Capital Investors, LLC ( Smith Capital or the Sub-Advisor ), manages the Funds portfolio in an unconstrained manner, meaning that its investment universe is not limited to the securities of any particular index and it has discretion to invest in fixed income securities of any type or credit quality, including up to 70% of its net assets in high yield (or junk) securities, up to 25% of its net assets in securities issued by issuers with significant ties to emerging market countries and up to 10% of its net assets in securities denominated in non-U.S. currencies. Additionally, under normal market conditions, the Funds average portfolio duration will vary from between 0 to 10 years. Duration is a measure of the expected price volatility of a fixed income security as a result of changes in market rates of interest. Smith Capital believes that markets move in cycles, which requires adaptability, discipline, and deep fundamental research. As part of this philosophy, Smith Capital seeks to proactively adjust risk exposure over market cycles by moving between defensive, neutral , and opportunistic positioning informed by macroeconomic views on the business and economic cycle, and valuations that exist in the market . Smith Capitals investment process starts with bottom-up analysis on individual credit exposures and applies a top-down macroeconomic assessment. Pursuant to this investment strategy, the Fund may invest principally in the following types of fixed income securities: securities issued or guaranteed by the U.S. government or its agencies, instrumentalities or U.S. government-sponsored entities; Treasury Inflation Protected Securities ( TIPS ); residential and commercial mortgage-backed securities; asset-backed securities; U.S. corporate bonds; fixed income securities issued by non-U.S. corporations and governments, including those with significant ties to emerging market countries; bank loans, including first lien senior secured floating rate bank loans ( Senior Loans ) and covenant lite loans; municipal bonds; collateralized loan obligations ( "CLOs" ); Rule 144A securities; and other debt securities bearing fixed, floating or variable interest rates of any maturity. The Fund may also invest in money market funds and other cash equivalents, fixed-to-floating rate securities, repurchase agreements, common stock and exchange-traded funds ( ETFs ), that invest primarily in fixed-income securities . The Fund may invest up to 25% of its total assets in preferred and convertible securities. The Fund may invest a significant portion of its assets in securitized investment products, including up to 50% of its net assets in each of asset-backed securities, residential mortgage-backed securities and commercial mortgage-backed securities. The Fund may invest in mortgage-backed securities issued or guaranteed by the U.S. government, its agencies or instrumentalities (such as Ginnie Mae), and U.S. government-sponsored entities (such as Fannie Mae and Freddie Mac). Government agency or instrumentality securities have different levels of credit support. The Fund may invest in such government supported mortgage-backed securities by investing in to-be-announced transactions ( TBA Transactions ). The Fund may invest up to 50% of its total assets in the following non-agency, non-government-sponsored entity securities and privately-issued mortgage-related and other asset-backed securities: residential mortgage- backed securities, commercial mortgage-backed securities, asset-backed securities and CLOs (collectively, Private MBS/ABS ). As stated above, the Fund may invest up to 70% of its net assets in securities rated below investment grade by one or more nationally recognized statistical rating organization ( NRSROs ), or, if unrated, judged to be of comparable quality by the Sub-Advisor (commonly referred to as high yield or junk bonds). Additionally, for newly-issued securities, the Fund may consider an expected rating provided by an NRSRO as if it were a final rating. The Fund may also invest in distressed securities, which are securities that are in default and are not expected to pay the current coupon. The Sub-Advisor considers emerging market countries to be countries that are characterized by developing commercial and financial infrastructure with significant potential for economic growth and increased capital market participation by non-U.S. investors. Though the Fund does not typically expect to use derivatives, for purposes of meeting its policy to invest at least 80% of net assets in fixed income securities, the Fund may hold derivatives that have characteristics similar to the securities in which the Fund may directly invest. In addition to considering economic factors such as the effect of interest rates on the Funds investments, the Sub-Advisor typically applies a bottom up approach in choosing investments. This means that the Sub-Advisor looks at income producing securities one at a time to determine if a security is an attractive investment opportunity and if it is consistent with the Funds investment policies. The Sub-Advisor additionally considers the expected risk-adjusted return on a particular investment and the Funds overall risk allocations and volatility. The Fund may utilize listed and over-the-counter traded derivatives instruments including, but not limited to, futures, options, swap agreements (including credit default swaps) and forward contracts for duration/yield curve management and/or hedging purposes. The Fund may invest up to 25% of its total assets in over-the-counter derivatives that are used to reduce currency, interest rate or credit risk arising from the Funds investments. The Funds investments in over-the-counter derivatives that are not used to hedge the Funds portfolio against currency, interest rate or credit risk will be limited to 20% of the Funds total assets. For purposes of these percentage limitations on over-the-counter derivatives, the weight of such derivatives will be calculated as the aggregate gross notional value of such over-the-counter derivatives. Show less