The Capital Appreciation Institutional Fund seeks to achieve its objective by investing in a diversified portfolio of companies with market capitalizations above approximately $800 million that are trading
at attractive prices, and appear to have strong potential for capital appreciation over the long-term.
Screening Process
The Capital Appreciation Institutional Fund's investment adviser, Symons Capital Management, Inc., principally uses a screening
process to begin the process of selecting stocks from a universe of approximately 2,000 stocks that are possible candidates for investment by all
the capital appreciation accounts managed by the adviser, including the Capital Appreciation Institutional Fund. The adviser utilizes
the adviser's multiple proprietary investment screens to reduce the universe to approximately 40-50 issuers that fit the
adviser's investment criteria for all managed accounts. In general, when selecting specific stocks, the adviser is looking
for attractive valuations resulting from a combination of characteristics, such as revenue growth, profit margins, and the
general efficiency of a company's operations (such as asset turnover), as well as special factors, such as the strength of
the company's balance sheet and barriers to entry by competitors.
Fundamental Analysis
After identifying 40 to 50 possible candidates through its proprietary screening process, the adviser performs a
fundamental analysis of each of the candidates, including an analysis of each prospect's underlying business and
particular risks, to identify companies that the adviser believes present the best opportunities for appreciation. The adviser
defines such a company as one that is trading at a price that presents significant upside price potential, based on the
adviser's determination of the company's intrinsic value, even though there may be higher than average downside price
risk in connection with the stock. Capital appreciation companies are companies that the adviser believes will have revenue and
earnings that grow faster than the economy as a whole, offering above-average prospects for capital appreciation, sometimes with
little or no dividend income. While the adviser attempts to limit downside risk for the Capital Appreciation Institutional
Fund's portfolio, the adviser's primary focus is on identifying companies that it believes are likely to provide significant
upside price movement. In general, the stocks included in the Symons Capital Appreciation Institutional Fund's portfolio
will exhibit some or all of the following characteristics:
Trading at a significantly lower price than the average prospect in relation to the adviser's determination of intrinsic value,
Attractive earnings growth rate,
Modest or no dividend,
Attractive upside potential due to the investment community temporarily being too negative on the company's prospects, and
Potential for higher future cash flow from operations.
The Capital Appreciation Institutional Fund typically holds approximately 25 to 35 stocks, representing various product or
service lines of business. To the extent the adviser can find "capital appreciation" stocks trading at sufficiently attractive prices for
purchase in various sectors, it will attempt to allocate the Capital Appreciation Institutional Fund's investments among a
broad cross-section of market sectors and industries. However, there may be times when the Fund may hold up to 40%
in one or more sectors at a given time; but, the Capital Appreciation Institutional Fund will not hold more than 25% of its
assets in any one industry.
In addition to investing in common stocks, the Capital Appreciation Institutional Fund may invest in real estate investment trusts ("REITs") that both trade like common stocks and invest directly in real estate. The fund also may invest in foreign securities through American Depositary Receipts ("ADRs") and Global Depositary Receipts ("GDRs"). ADRs and GDRs are receipts issued by U.S. banks for shares of a foreign corporation that entitle the holder to dividends and capital gains on the underlying security. ADRs are denominated in U.S. dollars, while GDRs may be denominated in U.S. dollars or in a foreign currency; both ADRs and GDRs trade on U.S. exchanges. The Capital Appreciation Institutional Fund will limit its investments in ADRs and GDRs to no more than 25% of its net assets.
The adviser believes in buying stocks of companies that will produce favorable results over the long-term and, therefore, the Capital Appreciation Institutional Fund does not intend to purchase or sell securities for short-term trading purposes. However, the adviser will sell a stock without regard to portfolio turnover for any one of the following reasons: the stock has reached what the adviser believes is its full value; there is a change in fundamentals internal or external to the company; or the adviser believes another stock offers a more attractive investment. The adviser does not anticipate that the Capital Appreciation Institutional Fund's portfolio turnover rate will exceed 70%.
The Value Institutional Fund seeks to achieve its objective by investing in a diversified portfolio of companies with market capitalizations above approximately $800 million that are trading at attractive prices, and appear to have limited downside price risk over the long-term.
Screening Process
The adviser principally utilizes a screening process to begin the process of selecting stocks for investment from a universe of approximately 2,000 stocks
that are possible candidates for investment by all value accounts managed by the adviser, including the Value
Institutional Fund. The adviser utilizes the adviser's multiple proprietary investment screens to reduce the universe to
approximately 40-50 stocks that fit its investment criteria for all managed accounts. In general, when selecting specific
stocks, the adviser is looking for attractive valuations resulting from a combination of characteristics, such as revenue
growth, profit margins, and the general efficiency of a company's operations (such as asset turnover), as well as special
factors, such as the strength of the company's balance sheet and barriers to entry by competitors.
Fundamental Analysis
After identifying 40 to 50 possible candidates through its proprietary screening process, the adviser then performs a
fundamental analysis of each of the candidates, including an analysis of each prospect's underlying business and
particular risks, to identify "value" companies. The adviser defines a "value" company as one that is trading at less than
its intrinsic value, as determined by the adviser, and does not present significant downside price risk. The adviser's
"value" strategy places a strong emphasis on risk aversion. When selecting investments for the Value Institutional Fund,
the adviser attempts to limit downside price risk by seeking to identify companies that exhibit some or all of the following fundamental "value" characteristics:
Trading at low prices in relation to the adviser's determination of intrinsic value,
Attractive dividend yields,
Low debt levels,
Broad, diversified product and/or service lines,
Strong balance sheets,
High levels of cash and short-term securities,
Low price to cash flow, price to earnings, and price to book ratios, and
High levels of tangible assets, such as plant, equipment and real estate.
The Value Institutional Fund typically holds approximately 25 to 35 stocks, representing various product or service lines of business. To the extent the adviser can find "value" stocks trading at sufficiently attractive prices for purchase in various sectors, it will attempt to allocate the Value Institutional Fund's investments among a broad cross-section of market sectors and industries. However, there may be times when the Value Institutional Fund may hold up to 40% in one particular sector at a given time; but, the Value Institutional Fund will not hold more than 25% of its assets in any one industry.
In addition to investing in common stocks, the Value Institutional Fund may invest in real estate investment trusts ("REITs") that both trade like common stocks and invest directly in real estate. The Fund may also invest in foreign securities through American Depositary Receipts ("ADRs") and Global Depositary Receipts ("GDRs"). ADRs and GDRs are receipts issued by U.S. banks for shares of a foreign corporation that entitle the holder to dividends and capital gains on the underlying security. ADRs are denominated in U.S. dollars, while GDRs may be denominated in U.S. dollars or in a foreign currency; both ADRs and GDRs trade on U.S. exchanges. The Value Institutional Fund will limit its investments in ADRs and GDRs to no more than 25% of its net assets.
The adviser believes in buying stocks of companies that will produce favorable results over the long-term and, therefore, the Value Institutional Fund does not intend to purchase or sell securities for short-term trading purposes. However, the adviser will sell a stock without regard to portfolio turnover for any one of the following reasons: the stock has reached what the adviser believes is its full value; there is a change in fundamentals internal or external to the company; or the adviser believes another stock offers a more attractive investment. The adviser does not anticipate that the Value Institutional Fund's portfolio turnover rate will exceed 70%.
The adviser believes in buying stocks of companies that will produce favorable results over the long-term and, therefore, the Capital Appreciation Institutional Fund does not intend to purchase or sell securities for short-term trading purposes. However, the adviser will sell a stock without regard to portfolio turnover for any one of the following reasons: the stock has reached what the adviser believes is its full value; there is a change in fundamentals internal or external to the company; or the adviser believes another stock offers a more attractive investment. The adviser does not anticipate that the Capital Appreciation Institutional Fund's portfolio turnover rate will exceed 70%.
The Small Cap Institutional Fund seeks to achieve its objective by investing primarily in a diversified portfolio of small capitalization
companies. The Small Cap Fund’s investment adviser, Symons Capital Management, Inc., manages the Fund using a
“core” investment strategy, pursuant to which the Fund will purchase small cap stocks trading on U.S. exchanges at
what the adviser believes are attractive prices, and that appear to have strong potential for capital appreciation over the
long-term. The adviser typically allocates the Small Cap Fund’s investments among a broad cross-section of market
sectors and industries, so long as small cap stocks with attractive valuations are available for purchase in those sectors
and industries. The sectors and industries presenting the best opportunities for investment vary over time. As a result,
the Small Cap Fund’s investments may, at times, tilt towards stocks with an emphasis on capital appreciation
and, at other times, tilt towards stocks with an emphasis on preservation of capital.
Screening Process
The adviser utilizes market capitalization and daily trading volume screens to identify approximately 2,000 small cap
companies that are possible candidates for investment by the Fund. The adviser defines “small cap” companies as those
with market capitalizations of $2 billion or less at the time of purchase. In addition, the adviser looks for an average daily
trading volume that demonstrates a level of liquidity that is acceptable to the adviser, generally at least $5 million
average daily trading volume. The adviser then evaluates a number of additional factors in order to initially reduce the
universe to approximately 50-70 issuers that fit the adviser’s basic investment criteria. In connection with the “value”
aspects of the core strategy, the adviser reviews factors such as a stock’s price to cash flow ratio, price to earnings, and
enterprise value to earnings before interest, taxes, depreciation, and amortization. With respect to the “capital appreciation” aspects
of the adviser’s core strategy, the adviser reviews factors such as revenue growth, profit margins, price to earnings
forecast, and product life cycle. The adviser may also review the company’s dividend paying history, if any, as well as its
trading history, including yearly highs and lows. In general, the adviser is looking for small cap companies with attractive
valuations resulting from a combination of characteristics, such as revenue growth and profit margins, as well as special
factors, such as strong balance sheets and barriers to entry by competitors.
Fundamental Analysis
The adviser performs a fundamental analysis of potential candidates to identify those small cap companies that the adviser believes present the best opportunities for investment by the Small Cap Fund. Pursuant to the adviser’s core investment strategy, the Small Cap Fund purchases securities of small cap companies that the adviser believes have sustainable business models, over the long-term, and that are trading at attractive prices. The Small Cap Fund typically holds a diversified portfolio of approximately 50 stocks among a broad cross-section of market sectors and industries. However, there may be times when the Small Cap Fund may hold a large portion of its assets in any one sector at a given time. The Small Cap Fund will not hold more than 25% of its assets in any one industry.
The adviser believes in buying stocks of companies that will produce favorable results over the long-term and, therefore, the Small Cap Fund does not intend to purchase or sell stocks for short-term trading purposes. However, the adviser may sell a stock without regard to portfolio turnover for any one of the following reasons: the stock has reached what the adviser believes is its full value; there is a change in fundamentals of the company or its particular market sector or industry; or the adviser believes another stock offers a more attractive investment opportunity.
You should carefully consider the investment objectives, potential risks, management fees, and charges and expenses of the Funds before investing. The Funds' prospectus contains this and other information about the Funds, and should be read carefully before investing. You may obtain a current copy of the Funds' prospectus by calling 1-877-679-6667. The Funds' past performance does not guarantee future results. The investment return and principal value of an investment in the Funds will fluctuate so that an investor's shares, when redeemed, may be worth more or less than their original cost. Current performance of the Funds may be lower or higher than the performance quoted. Performance data current to the most recent month end may be obtained by calling 1-877-679-6667. The Symons Institutional Funds are distributed by Unified Financial Securities, Inc., 2960 N. Meridian Street, Suite 300, Indianapolis, IN 46208-4715 (Member FINRA).
Symons Inst. Funds Prospectus
