Polen Upper Tier High Yield Fund
Management & Investment Process
The investment team leverages experience and knowledge within a disciplined investment process.
David J. Breazzano
Head of Team, Portfolio Manager
- Years Industry
- Years Industry
The Polen Upper Tier High Yield Fund seeks to exploit inefficiencies in the upper-tier segment (rated B- and above) of the high yield market. Polen Capital Credit incorporates ESG considerations in the investment process and aims to construct a fixed income portfolio with a yield advantage relative to the ICE BofA BB/B U.S. Non-Financial High Yield Constrained Index.
Bottom-Up Fundamental Research
- Analyze entire company, not just an individual bond/loan tranche
- 360-degree view of business – customers, suppliers, competitors
- Identify sustainable competitive advantages
- ESG factors evaluated for each investment
Minimize Credit Losses
- Calculate and continuously monitor company’s total enterprise value
- Focus on loan-to-value and cash flow
- Understand contractual protections in debt agreements
- Assess "waterfall of value" and downside scenarios
- Security selection drives performance
- No macro bets or themes
- Minimize credit losses and portfolio volatility
- Construct concentrated portfolios – overweight high confidence positions
- Long-term investment horizon
- Monitor to provide for appropriate diversification and liquidity
- ESG integration consistent with client views
- Limited exposure to CCC-rated bonds and/or leveraged loans
- Polen Upper Tier High Yield Fund – Prospectus
- Polen Upper Tier High Yield Fund – Summary Prospectus
- Polen Funds – Q1 Report (Form N-PORT)
- Polen IRA Kit
- Polen IRA Self-Certification
- Polen Inherited IRA Application Kit
- Polen Inherited IRA Supplement Documents
- Polen Upper Tier High Yield Fund – New Account Application
- Polen Upper Tier High Yield Fund – Statement of Additional Information
- Required Minimum Distribution Election Form
Tranche: Tranches are pieces of a pooled collection of securities, usually debt instruments, that are split up by risk or other characteristics in order to be marketable to different investors. Each portion, or tranche, is one of several related securities offered at the same time but with varying risks, rewards and maturities to appeal to a diverse range of investors.
Waterfall of Value: This term is used to describe, in the context of an issuer’s restructuring, the value that each class of debt must be repaid before any residual value is permitted to be distributed by the issuer to more junior classes of debt.
The benchmark, the ICE BofA BB/B U.S. Non-Financial High Yield Constrained Index, is a broad, unmanaged high yield index. The index contains all securities in the ICE BofA U.S. High Yield Index rated BB1 through B3, based on an average of Moody’s, S&P and Fitch, but caps issuer exposure at 2% and excludes financials. Index constituents are capitalization-weighted, based on their current amount outstanding, provided that the total allocation to an individual issuer does not exceed 2%. This index, which is unmanaged, does not incur any fees, and does not include any private obligations, convertible bonds, and certain other securities and obligations, does not reflect the specific investment restrictions and guidelines of the Fund; any information provided with respect to such index is provided for comparative purposes only. 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 Polen Capital Credit, the Fund, or any of the products or services offered by Polen Capital Credit.
Mutual fund investing involves risk, including possible loss of principal. The Fund targets investments in high yield, or below investment grade, fixed income securities. Such investments are subject to several types of investment risk, including, without limitation, credit risk (i.e., the risk that the issuer may be unable to make timely interest payments as well as repay the principal upon maturity), interest rate risk (i.e., the risk that their value will be inversely affected by fluctuations in the prevailing interest rates), market risk (i.e., the risk that their value may decline, sometimes rapidly or unpredictably, due to general market conditions), call or income risk, (i.e., the risk that certain debt securities with high interest rates will be prepaid or “called” by the issuer before they mature), and event risk (i.e., the risk that certain debt securities may suffer a substantial decline in credit quality and market value if the issuer restructures). In particular, debt investments in high yield issuers, which are described as speculative by major credit rating agencies and commonly referred to as “junk bonds”, are generally more susceptible to credit risk than other fixed income investments. In addition, the Fund’s high yield debt investments, including bank loans and Rule 144A securities, are subject to liquidity risk, as the Fund may not be able to sell investments at the best prices or at the value that the Fund places on them. The Fund also may target investments in equity securities, typically in high yield or leveraged issuers. Such investments, which are the most junior security in a company’s capital structure and typically subject to significant volatility in price, are subject to equity securities risk. An investor should be aware that the foregoing is not an exhaustive list of all of the risks associated with investing in the Fund.
ESG Risk: The Adviser integrates material environmental, social, and governance (ESG) factors into research analysis as part of a comprehensive evaluation of a company’s long-term financial sustainability. The risk that the investment techniques and risk analyses applied by the investment adviser, including but not limited to the Adviser’s integration of ESG factors into its research analysis, will not produce the desired results and that legislative, regulatory, or tax developments may affect the investment techniques available to the investment adviser and the individual portfolio manager in connection with managing the Fund. There is no guarantee that the investment objective of the Fund will be achieved.
Investors should consider the investment objectives, risks, charges and expenses of the Polen Upper Tier High Yield Fund carefully before investing. A prospectus with this and other information about the Fund may be obtained by calling 1-888-678-6024 or from the Fund Documents section of this webpage. It should be read carefully before investing.
Polen Upper Tier High Yield Fund is distributed by Foreside Funds Distributors LLC., not affiliated with Polen Capital Management.