Penn Capital Short Duration High Income Fund
Nav | Daily $ Change | Daily % Change | Year To Date | Inception Date | Share Class |
---|---|---|---|---|---|
$9.60
|
-$0.01
|
-0.10%
|
6.24%
|
|
Institutional
|
Overview
The Short Duration High Income Fund seeks to combine the downside protection of investment grade bonds with the upside return potential of high yield bonds while minimizing interest rate risk.
Differentiated profile characteristics of the Short Duration High Income Fund:
- Seek to take advantage of inefficiency in the BBB/crossover investment grade market from forced selling on downgrade fears
- Focus on Single-B and above credit quality rated bonds that are typically senior in a company’s capital structure
- Fill void created by total-return strategies selling lowest yielding securities
- Detailed covenant reviews that help identify bonds with higher probability of a successful refinance
Objective
The Penn Capital Short Duration High Income Fund seeks to provide a high level of current income.
Strategy
The Fund seeks to achieve its investment objective by investing, under normal circumstances, primarily in short-term fixed income securities and senior floating rate loans that are rated below investment grade.
Investment Type Examples
Fixed income securities in which the Fund may invest include debt securities such as bonds, notes and debentures.
Industry Examples
Aerospace & Defense, Consumer Products, Food & Drug Retail, Financials, Healthcare, Media/Broadcasting, Metals and Mining, Printing/Publishing, Telecommunications, and Utilities.
Performance
AS OF 12/31/2023 Ticker: PSHNX | CUSIP: 707269882 |
MTD | QTD | YTD | 1 Year | 3 Year | 5 Year | 10 Year | Since Inception |
---|---|---|---|---|---|---|---|---|
Penn Capital Short Duration High Income Fund
|
1.59%
|
3.91%
|
8.71%
|
8.71%
|
3.20%
|
3.55%
|
n/a |
2.89%
|
ICE BofA 1-3 Year BB US Cash Pay HY Index
|
1.63%
|
4.01%
|
8.86%
|
8.86%
|
2.89%
|
4.54%
|
n/a |
3.87%
|
ICE BofA 1-3 Year BB/B US Cash Pay HY Index
|
1.88%
|
4.04%
|
10.45%
|
10.45%
|
3.92%
|
4.60%
|
n/a |
4.11%
|
AS OF 12/31/2023 Ticker: PSHNX | CUSIP: 707269882 |
|
---|---|
Penn Capital Short Duration High Income Fund | |
MTD | 1.59 |
QTD | 3.91 |
YTD | 8.71 |
1 Year | 8.71 |
3 Year | 3.20 |
5 Year | 3.55 |
10 Year | n/a |
Since Inception
|
2.89 |
ICE BofA 1-3 Year BB US Cash Pay HY Index | |
MTD | 1.63 |
QTD | 4.01 |
YTD | 8.86 |
1 Year | 8.86 |
3 Year | 2.89 |
5 Year | 4.54 |
10 Year | n/a |
Since Inception
|
3.87 |
ICE BofA 1-3 Year BB/B US Cash Pay HY Index | |
MTD | 1.88 |
QTD | 4.04 |
YTD | 10.45 |
1 Year | 10.45 |
3 Year | 3.92 |
5 Year | 4.60 |
10 Year | n/a |
Since Inception
|
4.11 |
Investment Process
Step 1
Economic Outlook
Penn Capital’s team determines industries with potential relative value: the economic cycle, business environment, industry/sector analysis, and interest rates.
Step 2
Quantitative Screening
Penn Capital’s analysts and portfolio managers screen industries for companies with higher spreads to treasury relative to: comparable companies, industry averages, and historical averages.
Step 3
Other Proprietary Sources
Penn Capital’s analysts and portfolio managers source ideas from leveraging our equity relationships: equity investment styles & conferences, IPO & competitive intelligence, management meetings and road shows, industry experts, ex-government officials.
Step 4
Improving Fundamentals
Penn Capital's analysts and portfolio managers further screen for companies with improving financial metrics such as Debt/EBITDA, EBITDA/interest expense, free cash flow/debt.
Step 5
Liquidity Outlook
Penn Capital's analysts and portfolio managers screen for liquidity issues and perform research such as covenant analysis, bank loan availability, and asset value analysis.
Step 6
Qualitative Research
Penn Capital's analysts and portfolio managers then perform qualitative research such as company management, strong fundamentals, positive catalysts, suppliers/customers /competitors, and industry experts.
Step 7
Penn Capital Risk Rating (PRR)
Primary and secondary analysts and portfolio managers assign the proprietary Penn Capital Risk Rating (PRR) which includes forward looking estimates of credit quality, quantitative/qualitative factors, and rating agencies.
Step 8
Team Review and Approval
The investment team consists of all portfolio managers and analysts; daily team meetings are primary forums for discussion and a consensus at team level is required prior to moving a recommendation on to High Yield Credit Committee.
Step 9
High Yield Credit Committee Approval*
Committee confirms PRR and relative value: review of ideas approved by investment team, considers impact of credit on portfolio construction.
*After Step 9, an idea is either approved for portfolio inclusion or dismissed to the company watch list with further due diligence required.
Fees & Expenses
Total Fund annual net operating expenses (after fee waiver/expense reimbursement) are: Institutional Class 0.54%.
Total Fund annual gross operating expenses (before fee waiver/expense reimbursement) are: Institutional Class 1.25%.
The Fund's advisor has contractually agreed to waive its fees and/or pay for operating expenses of the Fund to ensure that total annual fund operating expenses do not exceed 0.54% of the average daily net assets for Institutional Class shares of the Fund. This agreement is in effect until December 31, 2024. The Fund’s advisor is permitted to seek reimbursement from the Fund of fees waived for a period of three years from the date of the waiver or payment to the extent it does not exceed the expenses limits.
Portfolio Managers
Joseph Maguire, CFA
Mr. Maguire has been with Penn Capital since 2005. As Director of Research, he is responsible for guiding the firm’s day-to-day global investment research process. Mr. Maguire chairs the Credit Risk Committee and serves as a Senior Portfolio Manager for Penn Capital’s Short Duration, Defensive High Yield and Opportunistic High Yield strategies.
Prior to joining Penn Capital, he conducted private equity research for AMS Inc. and was a senior audit associate for PricewaterhouseCoopers LLP. He received a BBA in Accounting from The College of William & Mary and an MBA from the Kenan-Flagler Business School at the University of North Carolina at Chapel Hill.
Key Fund Documents
- Fund Factsheet
- Fund Holdings
- Prospectus
- Q1 Holdings
- SAI (Statement of Additional Information)
- Institutional Share Class IRA Application
- Institutional Share Class Entity Account Application
- Institutional Share Class Application
- IRA Transfer Form
- IRA Distribution Form
- Annual Report
- Q3 Holdings
- Semi-Annual Report
- Certification of Beneficial Owners Form for Entities
- Mutual Funds Redemption Form
Legal Disclaimers
All investments involve risk, including possible loss of principal. The Fund invests in ETFs and is therefore subject to the same risks as the underlying securities in which the ETF invests as well as entails higher expenses than if invested into the underlying ETF directly. As interest rates rise the value of bond prices will decline. Credit risk refers to the loss in the value of a security based on a default in the payment of principal and/or interest of the security, or the perception of the market of such default. High-yield bonds have a higher risk of default or other adverse credit events, but have the potential to pay higher earnings over investment grade bonds. The value of convertible securities tends to decline as interest rates rise and, because of the conversion feature, tends to vary with fluctuations in the market value of the underlying securities. Bank loans in which the Fund may invest have similar risks to below investment grade fixed income securities. In the event of the insolvency of an agent bank, a loan could be subject to settlement risk as well as the risk of interruptions in the administrative duties performed in the day to day administration of the loan. The Fund invests in foreign securities and ADRs, which involves certain risks such as currency volatility, political and social instability and reduced market liquidity.
The performance data quoted here represents past performance. Past performance is no guarantee of future results. Investment return and principal value will fluctuate, so that an investor's shares, when redeemed, may be worth more or less than their original cost. Current performance may be lower or higher than the performance information quoted. To obtain performance information current to the most recent month-end please call 844-302-PENN (7366).
BEFORE INVESTING YOU SHOULD CAREFULLY CONSIDER THE FUND’S INVESTMENT OBJECTIVES, RISKS, CHARGES AND EXPENSES. THIS AND OTHER RELEVANT INFORMATION CAN BE FOUND IN THE PROSPECTUS AND STATEMENT OF ADDITIONAL INFORMATION, COPIES OF WHICH MAY BE OBTAINED BY CALLING 844-302-PENN (7366). PLEASE READ THE PROSPECTUS CAREFULLY BEFORE YOU INVEST.
Inception date: 7/17/2017. Performance reflects total returns, represents past performance, and is no guarantee of future results. Investment returns and principal values may fluctuate so that an investor’s shares, when redeemed, may be worth more or less than their original cost. Current performance may be lower or higher than that shown. All returns assume reinvestment of all dividend and capital gain distributions. Performance reflects the deduction of all actual fees and expenses of the related accounts during the periods shown and not the fees and expenses payable by the Penn Capital Short Duration High Income Fund. Penn Capital mutual funds are distributed by Quasar Distributors, LLC, which is not affiliated with Penn Capital or any of its affiliates. Penn Capital mutual funds are available to U.S. residents only.
Quasar Distributors, LLC.