Banner

DDJ Opportunistic High Yield Fund

Investment Objective

The Fund’s investment objective is overall total return consisting of a high level of current income together with long-term capital appreciation.

Principal Investment Strategies of the Fund

The Fund pursues its investment objective by seeking to outperform the broader high yield market over a complete credit cycle. The “credit cycle” is a cyclical event that generally occurs over a several year timeframe as access to credit increases or decreases for borrowers. The Fund seeks to achieve its objective mainly by investing in high yield fixed income securities with a focus on “middle market” issuers in the United States and, to a lesser extent, Canada. DDJ considers middle market companies to be those with normalized earnings before interest, tax and depreciation (“EBITDA”) in the range of $20-250 million. DDJ believes that the flexibility to invest, sell, and reinvest throughout the capital structure of an issuer (and in particular, in both more senior bank loans and more junior high yield bonds) will enable DDJ to tailor its investment approach to the specific credit-related circumstances of that issuer as they may change from time to time and thereby select the most attractive opportunities for the Fund.

The Fund intends to invest a substantial amount of its assets in credit instruments that are rated below investment grade by some or all relevant independent rating agencies, including Moody’s Investors Service, Standard and Poor’s Rating Services and Fitch Ratings. Additionally, certain other high yield securities may be unrated by rating agencies, but determined by DDJ to be of similar quality as other below investment grade bonds and credit instruments and accordingly purchased for investment by the Fund. The Fund does not have a percentage limitation on investing in securities that are rated below investment grade.

High yield fixed income securities include high yield corporate bonds (commonly known as “junk bonds”), senior loans, convertible bonds, preferred stock, and other types of debt instruments (including, without limitation, unregistered (Rule 144A) securities, floating and variable rate securities and other restricted fixed income securities to the extent permitted by the Investment Company Act of 1940, as amended (the “1940 Act”)). In addition, the Fund may also purchase equity securities or otherwise hold positions in equity or other assets that the Fund receives as part of a reorganization process of a high yield issuer, and may hold those assets until such time as DDJ believes that a disposition is most advantageous. From time to time, the Fund may make investments in distressed or defaulted securities or in issuers that are in bankruptcy. The Fund does not have any maturity or duration requirements. However, the Fund typically targets securities that, on average, have a shorter maturity and duration than the maturity and duration of broad-based high yield market indices generally. In making these investments, DDJ will seek to purchase instruments that DDJ believes are undervalued and offer a compelling risk/reward ratio. Specifically, DDJ’s investment process attempts to exploit inefficiencies in the high yield credit markets by adhering to a disciplined, bottom-up, fundamentally-oriented investment process with a strict adherence to downside protection. This process applies value investing principles through exhaustive research coupled with financial, structural and legal analysis, including a review of bankruptcy law considerations where applicable. The foundation of this investment process is to derive an accurate, real-time valuation of a target company, and only invest in securities of that company’s capital structure that offer a significant margin of safety coupled with strong total return potential. By utilizing such a fundamental, bottom-up approach to investing, DDJ seeks to add value first and foremost through security selection.

DDJ intends to manage a relatively concentrated portfolio typically comprising between 60-80 issuers and 80-100 issues. The Fund has adopted an investment policy providing that under normal circumstances, the Fund will invest at least 80% of the value of its assets (net assets plus the amount of any borrowings for investment purposes) in high yield fixed income securities.

Performance

Cumulative as of 07/31/2018 1 month 3 month 1 year YTD Since Inception*
Class Institutional (NAV) 1.66% 0.58% 4.06% 2.22% 24.25%
ICE BofAML U.S. High Yield Non-Financial Index (H0NF)1 1.12% 1.51% 2.52% 1.31% 18.56%
Class I (NAV) 1.62% 0.58% 3.99% 2.19% 24.11%
ICE BofAML U.S. High Yield Non-Financial Index (H0NF)1 1.12% 1.51% 2.52% 1.31% 18.56%
Class II (NAV) 1.54% 0.43% 3.76% 2.09% 23.09%
ICE BofAML U.S. High Yield Non-Financial Index (H0NF)1 1.12% 1.51% 2.52% 1.31% 18.56%
Quarterly as of 06/30/2018 1 month 3 month 1 year YTD Since Inception*
Class Institutional (NAV) -0.52% -1.74% 4.06% 0.56% 22.22%
ICE BofAML U.S. High Yield Non-Financial Index (H0NF)1 0.37% 1.09% 2.52% 0.19% 17.24%
Class I (NAV) -0.48% -1.65% 3.99% 0.56% 22.13%
ICE BofAML U.S. High Yield Non-Financial Index (H0NF)1 0.37% 1.09% 2.52% 0.19% 17.24%
Class II (NAV) -0.53% -1.76% 3.76% 0.53% 21.21%
ICE BofAML U.S. High Yield Non-Financial Index (H0NF)1 0.37% 1.09% 2.52% 0.19% 17.24%

Performance data quoted represents past performance and is no guarantee of future results. Investment returns and the principal value of the Fund will fluctuate so that shares, when redeemed, may be worth more or less than their original cost. Current performance may be higher or lower than the performance quoted. Please call 1-844-363-4898 for current month end performance.

*Fund Inception is 7/16/2015

Institutional Class: Gross Expense Ratio - 5.19% †, Net Expense Ratio- 0.79% †, Redemption Fee- 1.00% as of 1/28/2017

Class I: Gross Expense Ratio - 5.10% †, Net Expense Ratio- 0.89% †, Redemption Fee- 1.00% as of 1/28/2017

Class II: Gross Expense Ratio - 6.18% †, Net Expense Ratio- 1.14% †, Redemption Fee- 1.00% as of 1/28/2017

1The ICE BofA Merrill Lynch US Non-Financial High Yield Index is a subset of The ICE BofA Merrill Lynch US High Yield Index excluding all securities of financial issuers. Source ICE Data Indices, LLC (“ICE Data”) is used with permission. ICE Data, its affiliates and their respective third party suppliers disclaim any and all warranties and representations, express and/or implied, including any warranties of merchantability or fitness for a particular purpose or use, including the index, index data and any data included in, related to, or derived therefrom. Neither ICE Data, its affiliates or their respective third party providers shall not be subject to any damages or liability with respect to the adequacy, accuracy, timeliness or completeness of the index or the index data or any component thereof, and the index and index data and all components thereof are provided on an “as is” basis and users should use at their own risk. ICE Data, its affiliates and their respective third party suppliers do not sponsor, endorse, or recommend DDJ, the Fund, or any of DDJ’s products or services.

DDJ Capital Management, LLC (the “Adviser”) has contractually agreed to limit the amount of the Fund’s Total Annual Fund Operating Expenses, exclusive of Distribution and Service (12b-1) fees, Shareholder Servicing expenses, brokerage expenses, interest expenses, taxes and extraordinary expenses, to an annual rate of 0.79% of the Fund’s average daily net assets for each of the Class I, Class II and Institutional Class shares, respectively. This agreement is in effect through January 31, 2018. The Adviser will be permitted to recover, on a class-by-class basis, expenses it has borne through the agreement described above to the extent that the Fund’s expenses in later periods fall below the annual rate set forth above. The Fund will not be obligated to pay any such deferred fees and expenses more than three years after the end of the fiscal year in which the fees and expense were deferred. The Adviser may not discontinue this waiver without the approval by the Fund’s Board of Trustees.

as a percentage of amount redeemed within 60 days of purchase

Holdings

Holdings as of 06/30/2018, Subject to change

Security Symbol Weight
U.S. Renal Care Inc. - Term Loan (Second Lien)8927-2003.84%
Specialty Steel Holdco Inc.000SSWI02.91%
Asurion LLC - Replacement B-2 Term Loan (Second Lien)7087-2002.62%
Specialty Steel Holdco Inc.84752HAB2.30%
One Call Corp Tlb3287-2002.28%
Carlson Travel Inc.14282LAC2.09%
Urban One Inc.75040PAQ2.08%
Hexion Inc.428302AA2.06%
RegionalCare Hospital Partners Holdings Inc.75915QAC2.03%
Optimas OE Solutions Holding LLC / Optimas OE Solutions Inc.68403UAA2.01%

Holdings as of 06/30/2018, Subject to change

Security Symbol Weight
U.S. Renal Care Inc. - Term Loan (Second Lien)8927-2003.84%
Specialty Steel Holdco Inc.000SSWI02.91%
Asurion LLC - Replacement B-2 Term Loan (Second Lien)7087-2002.62%
Specialty Steel Holdco Inc.84752HAB2.30%
One Call Corp Tlb3287-2002.28%
Carlson Travel Inc.14282LAC2.09%
Urban One Inc.75040PAQ2.08%
Hexion Inc.428302AA2.06%
RegionalCare Hospital Partners Holdings Inc.75915QAC2.03%
Optimas OE Solutions Holding LLC / Optimas OE Solutions Inc.68403UAA2.01%
Ten-X LLC - Term Loan (Second Lien)9561-2001.97%
TierPoint LLC - Initial Term Loan (Second Lien)3283-2001.85%
Jack Ohio Finance LLC / Jack Ohio Finance 1 Corp.46647DAB1.84%
Surgery Center Holdings Inc.84611WAB1.83%
CenturyLink Inc.156686AM1.83%
Calpine Corp.131347CF1.81%
Team Health Holdings Inc.88047PAA1.80%
High Ridge Brands Co.42979BAA1.80%
Alliant Holdings Intermediate LLC016094AA1.76%
Midas Intermediate Holdco II LLC / Midas Intermediate Holdco II Finance Inc.59563KAA1.75%
Parq Holdings Ltd. - Closing Date Term Loan (First Lien)2019-2001.75%
GTT Communications Inc.362393AA1.75%
Uniti Group LP / Uniti Group Finance Inc. / CSL Capital LLC20341WAD1.74%
MPH Acquisition Holdings LLC553283AB1.69%
Lanai Holdings III Inc. - Initial Term Loan (Second Lien)7128-2001.65%
One Call Corp.68347TAJ1.58%
Vizient Inc.92856JAA1.58%
Packaging Coordinators Midco Inc. - Term Loan (Second Lien)3183-2001.53%
Lully Finance S.A.R.L. (Lully Finance) - Initial Term B-1 Loan (Second Lien)6801-2001.53%
Utex Industries Inc. - Initial Loan (Second Lien)7138-2001.51%
Evergreen Skills Lux S.A.R.L. - Initial Term Loan (First Lien)6501-2001.47%
Real Alloy FrnLL07-2001.43%
Masergy Holdings Inc. - Initial Loan (Second Lien)7356-2001.39%
MEG Energy Corp.552704AC1.34%
Aveanna Healthcare LLC (BCPE Eagle Buyer LLC) - Term Loan (Second Lien)1058-2001.30%
Engineered Machinery Holdings Inc. - Initial Term Loan (Second Lien)6939-2001.28%
Material Sciences Corp.00MSC001.25%
RP Crown Parent LLC47215YAA1.24%
DexKo Global Inc. - Term B Loan (Second Lien)6460-2001.22%
Truck Hero Inc. - Term Loan (Second Lien)3496-2001.22%
Learning Care Group (U.S.) No. 2 Inc. - Initial Term Loan (Second Lien)1796-2001.21%
Peak 10 Holding Corp. - Initial Term Loan (Second Lien)7188-2001.20%
Townsquare Media Inc.892231AA1.19%
Real Alloy CommonREAALL081.13%
Parfums Holding Company Inc. -Term Loan (Second Lien)6000-2001.11%
Dentalcorp Tl3661-2001.10%
SportsnetY002-2001.10%
Foresight Energy LLC / Foresight Energy345525AE1.07%
Xerium Technologies Inc.98416JAE1.04%
Genoa Healthcare - Initial Term Loan (Second Lien)5740-2001.00%
Century Aluminum Co.156431AK1.00%
MH Sub I LLC (Micro Holding Corp.) - Initial Term Loan (Second Lien)8015-2001.00%
USIS Merger Sub Inc.91739VAA0.98%
Zest Acquisition Corp. - Initial Term Loan (Second Lien)1850-2000.98%
Eagle Holding Co. II LLC26959XAA0.89%
Focus Financial Partners LLC - Term Loan (Second Lien)4227-2000.89%
Deliver Buyer Inc. Tlb3294-2000.88%
American Tire Distributors Inc.00214TAA0.85%
Foresight Energy LLC - Term Loan1747-2000.78%
KUEHG Corp. (MergerSub Inc.) - Tranche B Term Loan (Second Lien)7944-2000.78%
PharMerica Corp. - Term Loan (Second Lien)7958-2000.77%
TransDigm Inc.893647BB0.76%
Uniti Group LP / Uniti Fiber Holdings Inc. / CSL Capital LLC20341WAE0.76%
One Call Corp.68347TAG0.70%
Evergreen Skills Lux S.A.R.L. - Initial Term Loan (Second Lien)6503-2000.55%
Optiv Inc. - Initial Term Loan (Second Lien)8909-2000.53%
Zayo Group LLC / Zayo Capital Inc.989194AL0.50%
Joseph T Ryerson & Son Inc.48088LAA0.48%
New Arclin U.S. Holding Corp. - Second Lien Term Loan0204-2000.23%
Material Sciences Corp. Strike Price: $0.01 Expires 12/22/203600MSC0020.19%
Jazz Acquisition Inc. - Term Loan (Second Lien)8064-2000.11%
Miami Valley Steel Services Inc. - Term LoanAMI-2000.10%
Cash Equivalent2.23%

Dividends

< Scroll to View More >