The Eventide Gilead Fund outperforms S&P 500 for third consecutive calendar year
Boston, MA, January 7, 2011 – The Eventide Gilead Fund, a mutual fund practicing values-based investing, achieved an after-fees one-year total return of 18.46% for its retail class shares compared with the S&P 500 Index total return of 15.06%, marking the third consecutive calendar year the Fund has finished ahead of its benchmark index. Since its inception on July 8, 2008, the Eventide Gilead Fund has generated a total annualized return of 12.95%, compared to a total annualized return of 1.80% for the S&P 500 index.
Performance as of December 31, 2010:
| 1 month | 3 months | 1 year | Inception (annualized) | |
|
Eventide Gilead |
10.24% | 15.69% | 18.46% | 12.95% |
|
S&P 500 |
6.68% | 10.76% | 15.06% | 1.80% |
Expenses ratios- Gross Expenses 4.13%, Net Expenses 1.63%. The advisor has agreed to maintain the Fund’s total annual operating expenses at 1.63% until October 31, 2011.
The Eventide portfolio management team attributes the Fund’s sustained outperformance to its values-driven investment approach:
“At the heart of sustainable financial returns are companies with sustainable business practices. We invest in companies that we believe excel at creating value for their customers and society,” explains Eventide portfolio manager Finny Kuruvilla, MD, PhD.
The Eventide Gilead Fund’s investment process, developed by Finny Kuruvilla and David Barksdale, uses multi-dimensional analytics designed to find companies capable of sustaining the long-term financial returns the Fund has experienced thus far. Hallmarks of the Fund’s investment process include dynamic fundamental analysis, proprietary technical models, Capital Asset Pricing Model-derived risk management principles, values-based screening, and a strategy called ‘Masters’ Select’, which aggregates the collective intelligence of proven portfolio managers, analysts, and algorithms.
Over the last three years of its outperformance, the Gilead Fund’s investment process has been stress-tested with a full and pronounced market cycle, through both bear and bull conditions. Here again, the portfolio management team credits their ability to successfully navigate the turbulent market conditions to their values-orientation, but also to their preference for companies with lower risk exposure to the overall economy. Co-portfolio manager David Barksdale explains:
“We continually monitor the risk exposures of our portfolio both on an individual stock level and as a whole. We not only look to create a portfolio with internal diversification but also measure its sensitivity to macro-economic conditions. We pay particular attention to the sensitivity of our allocation to changes in the US stock market and the value of the dollar compared with other currencies. At the end of 2010 we have positioned the portfolio to benefit from rising stock prices as well as a falling dollar.”
When asked about the kinds of challenges investors are likely to face in 2011, Mr. Barksdale pointed to the near-term risk in bonds and the medium-term uncertainty in the US dollar, both of which the Gilead Fund is actively managing for:
“Many investors have missed the rally in US stocks since 2009 and have instead been allocating an unusually large percentage of assets into bonds, driving an apparent bubble in their prices corresponding to historically low interest rates. This dynamic reversed after the Federal Reserve’s announcement of its quantitative easing program in November, and the subsequent fall in bond prices sets the stage for a return to more normal demand for US stocks. Quantitative easing also presents a long term challenge to the value of the dollar – which is reflected in rising interest rates. These forces create substantial near-term risks to bond investors.
Stocks have appreciated since 2009 partly because of decreasing supply because of share buybacks by companies despite weak demand from investors. If any substantial amount of demand shifts from the now-weakening bond market back into US stocks, the supply and demand dynamics will provide the opportunity for further upside in stock prices in 2011 – even without a pronounced US economic recovery.
While conditions for stock prices look generally favorable in 2011, we still allocate the portfolio preferentially into stocks that show appreciation potential not primarily dependent on broad market movements. This allows the fund to better complement our investors’ overall portfolios and allows the fund to still have appreciation potential should adverse market conditions reassert themselves.”
Reflective of these risk-managed strategies are the Gilead Fund’s holdings in health care and macroeconomically more insulated sectors. One example is Summer Infant (NASDAQ: SUMR), a leading provider of products for babies such as gates, monitors, and car seats. Finny Kuruvilla notes, “From its origins of having invented the ‘bouncy seat,’ Summer Infant has a long tradition of innovation in design and excellence in quality. Its impressive historic revenue and earnings growth make it an attractive investment for Eventide, given its relatively less dependence on the broader economy.” A second example is Momenta Pharmaceuticals (NASDAQ: MNTA). “With their best-in-class technology, they have the ability to participate in the coming wave of generics for so-called ‘biologics’, far more difficult to manufacture than ordinary small molecule drugs. This ultimately helps lower health care costs, which has already begun with the company’s FDA approval in 2010 for generic enoxaparin,” Dr. Kuruvilla comments.
About the Eventide Gilead Fund
The Eventide Gilead Fund (ETGLX) is a mutual fund that seeks to sustain market outperformance by investing in companies that excel at creating value, operate with integrity, and profit from ethical and sustainable activities. Since inception, the Gilead Fund has outperformed the S&P500 index by 11.15% annualized. The Gilead Fund is managed by Eventide Asset Management, LLC, a Boston-based investment advisor practicing values-based and socially responsible investing.
Expenses ratios- Gross Expenses 4.13%, Net Expenses 1.63%. The advisor has agreed to maintain the Fund’s total annual operating expenses at 1.63% until October 31, 2011.
The S&P 500 is an index created by Standard & Poor’s and is considered to represent the performance of the stock market generally. It is not an investment product available for purchase. Momenta Pharmaceuticals comprised 5.51% of the Fund’s net assets and Summer Infant, Inc. comprised 2.62% of net assets portfolio as of December 31, 2010. Portfolio holdings are subject to change.
Performance is historic and does not guarantee future results. Investment return and principal value will fluctuate with changing market conditions so that when redeemed, shares may be worth more or less than their original cost. Current performance may be lower or higher than the performance data quoted. To obtain the most recent month end performance information or the fund’s prospectus please call the fund, toll free at 1-877-771-EVEN (3836). You can also obtain a prospectus at www.eventidefunds.com
An investor should consider the Fund’s investment objectives, risks, charges and expenses carefully before investing or sending money. This and other important information about the Eventide Gilead Fund can be found in the Fund’s prospectus. Please read the prospectus carefully before investing. The Fund is distributed by Matrix Capital Group, Inc., New York, NY 10017.
Contacts:
The Eventide Gilead Fund
Robin John
877-771-EVEN (3836) x.55