NFLHX — Hercules Fund

NFLHX Fund Overview

NFLHX — Hercules Fund is a US mutual fund managed by SFS Series Trust, categorised as United States Blend / Core Equity. ABC INVEST provides holdings, performance, costs, cashflows, risk data, prospectus documents and SEC filings, sourced from SEC filings.

• Type: US mutual fund
• Manager: SFS Series Trust
• Category: United States Blend / Core Equity
• Assets under management: $994.20K
• Ticker: NFLHX
• SEC CIK: 0001818750
• SEC series ID: S000069737
• Share class ID: C000222495

NFLHX Investment Objective and Strategy

Hercules Fund describes its objective and strategy as follows, from its latest prospectus filed with the SEC by SFS Series Trust.

Investment objective

The Hercules Fund (the Fund) seeks aggressive growth of capital.

Principal investment strategy

The Fund seeks to achieve its investment objective by investing primarily in U.S. exchange traded derivatives (e.g. equity and index options, futures and options on futures) and exchange-traded funds (ETFs) that invest in equity securities of any market capitalization. The Fund may also invest directly in equity securities or other types of investment companies besides ETFs (i.e. mutual funds and closed-end funds). The Adviser implements the Funds strategy with the intent of capturing alpha (i.e. the Funds excess return above its benchmark index, the S&P 500 Index) from market volatility. The Funds volatility trading can involve positions that are designed to hedge or profit from either an increase or decrease in volatility. The Advisers rules-based technical and systematic strategy is designed to identify highly liquid (i.e.

can be converted to cash with minimal impact on its value), growth focused investments that, at times, may be hedged in order to protect the Fund from market declines or leveraged to capture market appreciation (i.e. all-weather performance). The Funds all-weather strategy is designed to generate positive absolute returns through all market cycles and it will allocate investments so that the Fund maintains a low correlation to the broad equity markets (i.e. the S&P 500 Index). There are several core investment principles that make up the foundation for the Funds all-weather investment strategy. First, the Fund will be actively managed. The all-weather strategy is dynamic and may result in frequent trading in the Funds portfolio. Second, the Adviser will focus the Funds investments in highly liquid and growth focused investments.

Third, the Adviser will attempt to generate alpha from market volatility by investing in exchange traded derivatives or structured trades in such derivatives that are designed to track or hedge against market volatility. Fourth, the Adviser will use exchange traded derivatives and/or ETFs to hedge the Funds market risk and protect the Fund from periods of market down cycles. Last, the Adviser seeks to reduce risk in the Funds portfolio by actively managing the Funds exposure to different asset classes primarily through its investments in ETFs and exchanged traded derivatives. The Funds investments in exchange traded derivatives may create financial leverage for the Fund which means the Funds potential for gain or loss is magnified and therefore amplify the effect of market volatility on the Funds share price.

The Adviser intends to use leverage when it believes the market, or a particular investment is positioned for continued growth/price appreciation. The Fund may also invest in exchange traded derivatives to hedge the Funds portfolio against market risk and/or to generate premium income by writing (selling) call options. Each of these investment strategies can have the effect of reducing the Funds correlation to the broad equity markets which is a key component of the Advisers all-weather strategy. The Funds investments in exchange traded derivatives may require the Fund to comply with certain collateral requirements set by brokers. In addition to any broker related requirements, the Fund will be required to maintain a segregated account with its custodian to collateralize its derivative positions as required by current Securities and Exchange Commission (SEC) or staff interpretations.

As a result, the Fund is required to maintain higher levels of cash or liquid assets (such as U.S. Treasury bills, money market accounts, repurchase agreements, certificates of deposit, high quality commercial paper and long equity positions) for collateral needs than if it did not use derivatives. The Fund will modify its asset segregation policies as necessary to ensure compliance with any changes in the positions taken by the SEC or its staff. The Funds all-weather strategy may result in active and frequent trading of portfolio instruments to achieve its investment objective. Also, the Fund may invest in a limited number of sectors but has no intention to concentrate its investments in any industry. The Fund is classified as non-diversified for purposes of the Investment Company Act of 1940 as amended (the 1940 Act), which means that it is not limited by the 1940 Act with regard to the portion of its assets that may be invested in the securities of a single issuer.

NFLHX Costs and Fees

NFLHX costs about $336 per $10,000 invested per year in fund expenses.

• Net expense ratio: 3.36%
• Gross expense ratio: 3.36%
• Brokerage commissions: 160.76 bps of average net assets (SEC N-CEN)

NFLHX Cashflows

Over the 12 months to 2021-06, Hercules Fund had net inflows of $923.72K, from monthly SEC N-PORT filings.

NFLHX Debt Constituents

No individual debt constituents are reported in Hercules Fund's latest SEC N-PORT filing.

NFLHX Prospectus and SEC Filings

Official Hercules Fund filings on SEC EDGAR — prospectus, portfolio holdings and annual reports.

• Prospectus supplement (497) — filed 2020-12-23
• Portfolio holdings (N-PORT) — filed 2021-08-20
• Portfolio holdings (N-PORT) — filed 2021-05-21
• Annual census (N-CEN) — filed 2021-11-23

Related Funds

Other United States Blend / Core Equity funds tracked on ABC INVEST:

• International Small Company Portfolio (DFISX)
• iShares Preferred and Income Securities ETF (PFF)
• Guggenheim Macro Opportunities Fund (GIOAX)
• Emerging Markets Portfolio (DFEMX)
• Eaton Vance Global Macro Absolute Return Advantage Fund (EGRAX)

Data Sources

ABC INVEST compiles this page from public filings made to the U.S. Securities and Exchange Commission (SEC) through EDGAR: portfolio holdings and monthly cashflows from Form N-PORT, expenses and returns from fund prospectuses (Form 485BPOS) and the SEC DERA Risk/Return Summary data sets, annual data from Form N-CEN, and shareholder reports from Form N-CSR.