The Fund seeks to maximize income, to the extent consistent with preservation of capital, primarily through investment in bonds, with a focus on opportunities related to climate change and other environmental issues.
The Fund uses an active trading strategy, seeking relative value to earn incremental income. Under normal circumstances, the Fund invests at least 80% of its net assets in "green" bonds. Bonds include debt securities of any maturity. The Fund typically invests at least 65% of its net assets in investment grade, U.S. dollar-denominated debt securities, as assessed at the time of purchase. The remaining 35% of Fund net assets may be in below-investment grade, high-yield debt securities. These securities involve greater risk of default or price declines than investment grade debt securities. The Fund primarily invests in a broad range of fixed-income securities, including, but not limited to, corporate bonds, project bonds, U.S. government securities, taxable municipal securities and mortgage-backed or other asset backed-securities ("ABS"), including commercial mortgage-backed securities. The Fund may also invest in foreign debt securities and securities that represent interests in pools of mortgage loans or other assets assembled for sale to investors by various U.S. governmental agencies, government-related organizations and private issuers, including collateralized mortgage obligations and ABS. The Fund seeks to invest primarily in "green" investments and also seeks to avoid investing in tobacco companies. The Fund defines "green" investments to include securities of companies that develop or provide products or services that address environmental solutions and/or support efforts to reduce their own environmental footprint; bonds that support environmental projects; structured securities that are collateralized by assets supporting environmental themes; and securities that, in the opinion of the Fund's Advisor, have no more than a negligible direct environmental impact, which may include securities issued by the U.S. government or its agencies, and U.S. government-sponsored entities. The Fund's investment process is enhanced by the Advisor's fundamental investment research, which seeks to add value by integrating traditional fundamental security analysis with the Advisor's proprietary views on critical environmental, social and governance issues.
Investment in the Fund involves risk, including possible loss of principal invested. Investing primarily in green investments carries the risk that, under certain market conditions, the Fund may underperform funds that invest in a broader array of investments. In addition, some green investments may be dependent on government tax incentives and subsidies, and on political support for certain environmental technologies and companies. The green sector may also have challenges such as a limited number of issuers and liquidity in the market, including a robust secondary market. The Fund is subject to interest rate risk and credit risk. When interest rates rise, the value of fixed-income securities will generally fall. In addition, the credit quality of the securities may deteriorate, which could lead to default or bankruptcy of the issuer where the issuer becomes unable to pay its obligations when due. An active trading style can result in higher turnover (exceeding 100%), may translate to higher transaction costs, may increase your tax liability, and may affect Fund performance. The Fund is non-diversified and may be more volatile than a diversified fund.