Risk Considerations
Equity Risk. An investment in a portfolio containing common stocks is subject to certain risks, such as an economic recession and the possible deterioration of either the financial condition of the issuers of the equity securities or the general condition of the stock market.
Sector Concentration Risk. A portfolio which is concentrated in an individual sector is subject to additional risks, including limited diversification.
Business Development Company Risk. Certain of the securities in the portfolio are issued by closed-end investment companies which have been elected to be treated as Business Development Companies (BDC). An investment in BDCs is subject to various risks, including management's ability to meet the BDC's investment objective, and to manage the BDC's portfolio during periods of market turmoil. BDCs may trade in the market at a discount to their net asset value. BDCs may employ the use of leverage which subjects the BDC to increased risks.
Closed-End Fund Risk. Closed-end funds are subject to various risks, including management's ability to meet the fund's investment objective, and to manage the fund's portfolio when the underlying securities are redeemed or sold, during periods of market turmoil and as investors' perceptions regarding the funds or their underlying investments change. Unlike open-end funds, which trade at prices based on a current determination of the fund's net asset value, closed-end funds frequently trade at a discount to their net asset value in the secondary market. Certain closed-end funds employ the use of leverage, which increases the volatility of such funds.
Financials Risk. The companies engaged in the financials sector are subject to the adverse effects of volatile interest rates, economic recession, decreases in the availability of capital, increased competition from new entrants in the field, and potential increased regulation.
Foreign Securities Risk. Securities of non-U.S. issuers are subject to additional risks, including currency fluctuations, political risks, withholding, the lack of adequate financial information, and exchange control restrictions impacting non-U.S. issuers.
REITs Risk. An investment in a portfolio containing REIT securities is subject to additional risks including limited diversification. Companies involved in the real estate industry are subject to changes in the real estate market, vacancy rates and competition, volatile interest rates and economic recession.
Small-Cap and Mid-Cap Risk. An investment in a portfolio containing small-cap and mid-cap companies is subject to additional risks, as the share prices of small-cap companies and certain mid-cap companies are often more volatile than those of larger companies due to several factors, including limited trading volumes, products, financial resources, management inexperience and less publicly available information.
Volatility Risk. The value of the securities held by the trust may be subject to steep declines or increased volatility due to changes in performance or perception of the issuers.
Additional Risk. For a discussion of additional risks of investing in the trust see the "Risk Factors" section of the prospectus.
Important Note. It is important to note that an investment can be made in the underlying funds directly rather than through the trust. These direct investments can be made without paying the trust's sales charge, operating expenses and organizational costs.
Operational Risk. As the use of Internet technology has become more prevalent in the course of business, the trust has become more susceptible to potential operational risks through breaches in cybersecurity.