Second, the adviser will seek to
realign the duration and sectors of the Fund to match the duration and sectors of the Bloomberg U.S. Aggregate
Index. As of May 31, 2022, the duration of the Bloomberg U.S. Aggregate Index was 6.51 years.
The Fund will primarily invest in bonds that are included in the Bloomberg U.S. Aggregate Index, but may invest in bonds
that are not included in the Bloomberg U.S. Aggregate Index. The Fund will not invest in debt securities that
are rated below investment grade at the time of purchase (i.e., high yield and junk bonds). The Fund may invest
in privately placed, restricted and unregistered securities.
The Fund may invest in Mortgage TBAs. Mortgage TBAs provide for the forward or delayed delivery of the underlying instrument
with settlement up to 180 days. The term TBA comes from the fact that the actual mortgage-backed security that
will be delivered to fulfill a TBA trade is not designated at the time the trade is made, but rather is
announced 48 hours before the settlement date.
The Fund may invest in debt obligations, denominated in U.S. dollars, that are issued by a foreign corporation or a U.S.
affiliate of a foreign corporation or a foreign government or its agencies and instrumentalities.
The Fund’s Main Investment Risks
The Fund is subject to management risk and may not achieve its objective if the adviser’s expectations regarding particular instruments or markets are not met.
An investment in this Fund or any other fund may not provide
a complete investment program. The suitability of an investment in the Fund
should be considered based on the investment objective, strategies and risks described in this prospectus, considered in light of all of the other investments in your portfolio, as well
as your risk tolerance, financial goals and time horizons. You may want to consult with a financial advisor to determine if this Fund is suitable for you.
The Fund is subject to the main risks noted below, any of which may adversely affect the Fund’s net asset value (NAV),
market price, performance and ability to meet its investment objective.
General Market Risk. Economies and financial markets throughout the world are becoming increasingly interconnected, which increases the likelihood that events or conditions in
one country or region will adversely impact markets or issuers in other countries or regions. Securities in the
Fund’s portfolio may underperform in comparison to securities in general financial markets, a particular
financial market or other asset classes due to a number of factors, including inflation (or expectations for
inflation), deflation (or expectations for deflation), interest rates, global demand for particular products or
resources, market instability, debt crises and downgrades, embargoes, tariffs, sanctions and other trade
barriers, regulatory events, other governmental trade or market control programs and related geopolitical
events. In addition, the value of the Fund’s investments may be negatively affected by the occurrence of
global events such as war, terrorism, environmental disasters, natural disasters or events, country
instability, and infectious disease epidemics or pandemics.
For example, the outbreak of COVID-19 has negatively affected economies, markets and individual companies throughout the world, including those in which the Fund invests. The effects of
this pandemic to public health and business and market conditions, including, among other things, reduced
consumer demand and economic output, supply chain disruptions and increased government spending, may continue
to have a significant negative impact on the performance of the Fund’s investments, increase the
Fund’s volatility, exacerbate pre-existing political, social and economic risks to the Fund, and
negatively impact broad segments of businesses and populations. In addition, governments, their regulatory
agencies, or self-regulatory organizations have taken or may take actions in response to the pandemic that
affect the instruments in which the Fund invests, or the issuers of such instruments, in ways that could have a
significant negative impact on the Fund’s investment performance. The duration and extent of COVID-19 and
associated economic and market conditions and uncertainty over the long-term cannot be reasonably estimated at this time. The ultimate impact of COVID-19 and the extent to which the associated conditions impact a Fund will also depend on future
developments, which are highly uncertain, difficult to accurately predict and subject to frequent
changes.
Interest Rate Risk. The Fund’s investments in bonds and other debt securities will change in value based on changes in interest rates. If rates rise, the value of these investments generally declines. Securities with greater interest rate sensitivity
and longer maturities generally are subject to greater fluctuations in value. The Fund may face a heightened
level of interest rate risk due to certain changes in monetary policy. During periods when interest rates are
low or there are negative interest rates, the Fund’s yield (and total return) also may be low or the Fund may be unable to maintain positive returns.
Credit Risk. The Fund’s investments are subject to the risk that issuers and/or counterparties will fail to make payments when due or default completely. If an issuer’s or
counterparty’s financial condition worsens, the credit quality of the issuer or counterparty may
deteriorate, making it difficult for the Fund to sell such investments.
Geographic Focus Risk. The Fund will focus its investments in the United States. As a result, the Fund’s performance may be subject to greater volatility than a more geographically
diversified fund.
Prepayment Risk. The issuer of
certain securities may repay principal in advance, especially when yields fall. Changes in the rate at which
prepayments occur can affect the return on investment of these securities. When debt obligations are prepaid or
when securities are called, the Fund may have to reinvest in securities with a lower yield. The Fund also may
fail to recover additional amounts (i.e., premiums) paid for securities with higher coupons, resulting in an
unexpected capital loss.
Asset-Backed, Mortgage-Related and Mortgage-Backed Securities
Risk. The Fund may invest in asset-backed, mortgage-related and mortgage-backed securities including so-called “sub-prime” mortgages that are subject to certain other risks
including prepayment and call risks. When mortgages and other obligations are prepaid and when securities are
called, the Fund may have to reinvest in securities with a lower yield or fail to recover additional amounts
(i.e., premiums) paid for securities with higher interest rates, resulting in an unexpected capital loss and/or
a decrease in the amount of dividends and yield. In