There is no guarantee that any investment strategy will achieve its objectives, generate profits or avoid losses.
The North Star Process – Micro to Macro Investing
While our focus is on overlooked small- and micro-cap companies, the North Star Mutual Funds actively invest in undervalued companies of all sizes. When considering an investment, we look for opportunities that meet at least four of the six criteria:
1. Statistically Undervalued
The stock trades at a discount to public comparables, private market multiples, and our internally established expected value calculations.
2. Defendable Business Model
The business has been through at least one business cycle.
3. High-Quality Balance Sheet
A balance sheet to withstand economic cycles with a bias toward no to low leverage.
4. Improving Business Prospects
The business’ mid-term prospects are improving due to specific or general reasons.
5. Advantageous Ownership
Company management has a vested interest in the successes of the shareholders.
6. Simple Business
We can understand and assess the risks inherent in the business model.
Mutual funds have investment risks including loss of principal. There is no guarantee the fund will meet its objective. In general, the price of a fixed income security falls when interest rates rise. There is a risk that issuers and counterparties will not make payments on securities and other investments held by the Fund, resulting in losses to the Fund.
The Fund may invest in high yield securities, also known as “junk bonds.” High yield securities provide greater income and opportunity for gain, but entail greater risk of loss of principal. Foreign common stocks and currency strategies will subject the Fund to currency trading risks that include market risk, credit risk and country risk. Municipal securities are subject to credit risk where a municipal security might not make interest and principal payments as they come due. The Adviser follows an investing style that favors value investments. At times when the value investing style is out of favor, the Fund may underperform other funds that use different investing styles.
Investments in lesser-known, small and medium capitalization companies may be more vulnerable than larger, more established organizations. As with any investment, there are risks associated with REITs. Investments in lesser-known, small and medium capitalization companies may be more vulnerable than larger, more established organizations. The Advisor does not attempt to keep the portfolio structure or fund performance consistent with any market index. Increased portfolio turnover may result in higher brokerage commissions, and other transaction costs may result in taxable capital gains.
Investors should carefully consider the investment objectives, risks, charges and expenses of the North Star Funds. No-load mutual funds are sold without sales charge; however, they have ongoing expenses, such as management fees. This and other important information about each of the Funds are contained in the prospectus, which can be obtained at www.nsinvestfunds.com or by calling (855) 580-0900. The prospectus should be read carefully before investing.
The North Star Funds are distributed by Northern Lights Distributors, LLC member FINRA/SIPC. Approval Code 4326-NLD-4/2/2018.