N-CSR 1 anchorncsr.htm N-CSR

united states
securities and exchange commission
washington, d.c. 20549

form n-csr

certified shareholder report of registered management
investment companies

Investment Company Act file number 811-23066

 

Northern Lights Fund Trust IV

(Exact name of registrant as specified in charter)

 

225 Pictoria Drive, Suite 450, Cincinnati, OH 45246

(Address of principal executive offices) (Zip code)

 

Wendy Wang, Gemini Fund Services, LLC.

4221 North 203rd Street, Suite 100, Elkhorn, NE 68022 

(Name and address of agent for service)

 

Registrant's telephone number, including area code: 631-470-2612

 

Date of fiscal year end: 8/31

 

Date of reporting period: 8/31/21

 

Item 1. Reports to Stockholders.

 

 

(LOGO) 

 

Anchor Risk Managed Credit Strategies Fund

Advisor Class (ATCAX)

Institutional Class (ATCSX)

 

Anchor Risk Managed Equity Strategies Fund

Advisor Class (ATEAX)

Institutional Class (ATESX)

 

Anchor Risk Managed Global Strategies Fund

Advisor Class (ATAGX)

Institutional Class (ATGSX)

 

Anchor Risk Managed Municipal Strategies Fund 

Advisor Class (ATAMX) 

Institutional Class (ATMSX)

 

Annual Report 

August 31, 2021

 

1-844-594-1226 

www.anchorcapitalfunds.com

 

This report and the financial statements contained herein are submitted for the general information of shareholders and are not authorized for distribution to prospective investors unless preceded or accompanied by an effective prospectus. Nothing herein contained is to be considered an offer of sale or solicitation of an offer to buy shares of the Anchor Funds. Such offering is made only by prospectus, which includes details as to offering price and other material information.

 

Distributed by Northern Lights Distributors, LLC. 

Member FINRA

 

 

 

 

 

 

 

 

 

 

 

(LOGO)

 

Anchor Risk Managed Credit Strategies Fund

Annual Shareholder Report

 

August 31, 2021

 

It is our pleasure to present the annual report for the Anchor Risk Managed Credit Strategies Fund for the fiscal year ended August 31, 2021. On behalf of the entire team at Anchor Capital, we would like to thank you for your investment in the Fund.

 

Performance

 

Concentrated vaccination programs, continued support from global central banks and loose monetary policy provided a favorable tailwind to the high yield market as they continued their arduous recovery from the lasting damages of COVID-19. As the markets marched towards all-time highs, questions started to arise concerning the Federal Reserve’s sustained involvement and the impact on the economy. Inflation levels not seen in decades have caught investors off guard, forcing them to rethink their portfolio composition.

 

The Institutional Class gained 4.57% for the fiscal year ended August 31, 2021, slightly underperforming the HFRX Absolute Return Index1 and the Morningstar Nontraditional Bond Category. The HFRX Absolute Return Index returned 4.78%, and the Morningstar Nontraditional Bond Category returned 5.44%.

 

Market and Fund Performance Commentary

 

Volatility remained elevated as we entered the final quarter of 2020. The highly-contested election coupled with the sensitive recovering economy left a lot of uncertainty on the table for investors. Stimulus talks began to stall out as the focus shifted towards election campaign efforts. COVID-19 began to mutate and prove resilient to the latest vaccine, which halted the economy reopening. As a result, the market quickly dropped throughout September and October- posting the first negative months since the March 2020 meltdown.

 

As the election results became apparent, the market quickly reversed course and continued its uptrend higher. The prospect of additional stimulus with a clear path to get it done put the market at ease with furthered government support. The focus began to shift back to virus production and administration, which led to slow containment of the virus. As the numbers of COVID-19 cases came down, the economy reopened, and economic activity rapidly picked up. Ongoing stimulus plans, the unwind of pent-up demand, and substantial supply-chain disruptions throughout the global economy increased expectations for higher inflation.

 

5545-NLD-09292021 www.anchor-capital.com

15 Enterprise, Suite 450

Aliso Viejo, CA 92656 USA

(800) 290-8633 main 

(949) 382-1497 fax

1

 

(LOGO)

 

Market Outlook

 

As we enter the final quarter of 2021, the impression of the Federal Reserve tightening monetary policy into a slowing recovery has increased the overall risk in the equity market. As inflation continues to run well-above the Federal Reserve’s target, the risk of a rising rate environment paired with historical highs in valuations leaves many wondering what to do with their portfolio allocations. With cash yielding near-to-nothing and inflation hovering at 5%, there are not many places to hide. In addition, the Federal Reserve’s swelling balance sheet and the issue of paying it off is becoming a concern. The Biden Administration plans to increase individual and corporate tax rates to fund the next stimulus plan could produce volatility and uncertainty in the markets. We believe this type of volatility and uncertainty is well-suited for risk managed strategies, and specifically the Fund.

 

Eric Leake, CMT Garrett Waters
President, Anchor Capital CEO, Anchor Capital

  

1The HFRX Absolute Return Index is designed to be representative of the overall composition of the hedge fund universe. As a component of the optimization process, the index selects constituents which characteristically exhibit lower volatilities and lower correlations to standard directional benchmarks of equity market and hedge fund industry performance.

 

5545-NLD-09292021 www.anchor-capital.com

15 Enterprise, Suite 450

Aliso Viejo, CA 92656 USA

(800) 290-8633 main 

(949) 382-1497 fax

2

 

(LOGO)

 

Anchor Risk Managed Equity Strategies Fund

Annual Shareholder Report

 

August 31, 2021

 

It is our pleasure to present the annual report for the Anchor Risk Managed Equity Strategies Fund for the fiscal year ended August 31, 2021. On behalf of the entire team at Anchor Capital, we would like to thank you for your investment in the Fund.

 

Performance

 

Concentrated vaccination programs, continued support from global central banks and loose monetary policy provided a positive tailwind to the equity markets as they continued their arduous recovery from the lasting damages of COVID-19. As the markets marched towards all-time highs, questions started to arise concerning the Federal Reserve’s sustained involvement and the impact on the economy. Inflation levels not seen in decades have caught investors off guard, forcing them to rethink their portfolio composition.

 

The Advisor Class gained 15.85% for the fiscal year ended August 31, 2021, underperforming the S&P 500 Total Return Index and slightly underperforming the Morningstar Long-Short Equity Category. The S&P 500 Total Return Index1 returned 31.17%, and the Morningstar Long-Short Equity Category returned 16.98%.

 

Market and Fund Performance Commentary

 

Volatility remained elevated as we entered the final quarter of 2020. The highly-contested election coupled with the sensitive recovering economy left a lot of uncertainty on the table for investors. Stimulus talks began to stall out as the focus shifted towards election campaign efforts. COVID-19 began to mutate and prove resilient to the latest vaccine, which halted the economy reopening. As a result, the market quickly dropped throughout September and October- posting the first negative months since the March 2020 meltdown.

 

As the election results became apparent, the market quickly reversed course and continued its uptrend higher. The prospect of additional stimulus with a clear path to get it done put the market at ease with extended government support. The focus began to shift back to virus production and administration, which led to slow containment of the virus. As the numbers of COVID-19 cases came down, the economy reopened, and economic activity rapidly picked up. Ongoing stimulus plans, the unwind of pent-up demand and substantial supply-chain bottlenecks throughout the global economy increased expectations for higher inflation. As a result, the reflation trade benefitted as inflation fears spread throughout the economy. This led to the underperformance of the Fund against its benchmark.

 

5545-NLD-09292021 www.anchor-capital.com

15 Enterprise, Suite 450

Aliso Viejo, CA 92656 USA

(800) 290-8633 main 

(949) 382-1497 fax

3

 

(LOGO)

 

Market Outlook

 

As we enter the final quarter of 2021, the impression of the Federal Reserve tightening monetary policy into a slowing recovery has increased the overall risk in the equity market. As inflation continues to run well-above the Federal Reserve’s target, the risk of a rising rate environment paired with historical highs in valuations leaves many wondering what to do with their portfolio allocations. With cash yielding near-to-nothing and inflation hovering at 5%, there are not many places to hide. In addition, the Federal Reserve’s swelling balance sheet and the issue of paying it off is becoming a concern. The Biden Administration plans to increase individual and corporate tax rates to fund the next stimulus plan could produce volatility and uncertainty in the markets. We believe this type of volatility and uncertainty is well-suited for risk managed strategies, and specifically the Fund.

 

Eric Leake, CMT Garrett Waters
President, Anchor Capital CEO, Anchor Capital

 

1The S&P 500 TR Index is a market capitalization-weighted index of 500 widely held stocks often used as a proxy for the stock market. Standard & Poor’s chooses the members companies for the S&P based on market size, liquidity, and industry group representation. Calculated intraday by S&P based on the price changes and reinvested dividends of the S&P 500 Index.

 

5545-NLD-09292021 www.anchor-capital.com

15 Enterprise, Suite 450

Aliso Viejo, CA 92656 USA

(800) 290-8633 main

(949) 382-1497 fax

4

 

(LOGO)

 

Anchor Risk Managed Global Strategies Fund

Annual Shareholder Report

 

August 31, 2021

 

It is our pleasure to present the annual report for the Anchor Risk Managed Global Strategies Fund for the fiscal year ended August 31, 2021. On behalf of the entire team at Anchor Capital, we would like to thank you for your investment in the Fund.

 

Performance

 

Concentrated vaccination programs, continued support from global central banks and loose monetary policy provided a favorable tailwind to the equity markets as they continued their arduous recovery from the lasting damages of COVID-19. As the markets marched towards all-time highs, questions started to arise concerning the Federal Reserve’s sustained involvement and the impact on the economy. Inflation levels not seen in decades have caught investors off guard, forcing them to rethink their portfolio composition.

 

The Advisor Class gained 11.94% for the fiscal year ended August 31, 2020, underperforming the MSCI All Country World Index1 and the Morningstar Long-Short Equity Category. The MSCI All Country World Index returned 28.64%, and the Morningstar Long-Short Equity Category returned 16.98%.

 

Market and Fund Performance Commentary

 

Volatility remained elevated as we entered the final quarter of 2020. Global vaccination efforts remained muted while developed countries focused supplies on their citizens first. COVID-19 began to mutate and prove resilient to the latest vaccine, which halted the global economy reopening and further disrupted the supply chain. As a result, the market quickly dropped throughout September and October- posting the first negative months since the March 2020 meltdown.

 

As global vaccination efforts improved in the first quarter of 2021, economic numbers continued to surprise to the upside. The emerging markets that were hit hardest by the pandemic started to receive their first batch of vaccinations. As the spread dissipated and the emerging markets slowly reopened, a considerable rebound in economic activity occurred. As a result, emerging markets outperformed relative to developed countries during this period, leading to the Fund’s underperformance against its benchmark.

 

5545-NLD-09292021 www.anchor-capital.com

15 Enterprise, Suite 450

Aliso Viejo, CA 92656 USA

(800) 290-8633 main

(949) 382-1497 fax

5

 

(LOGO)

 

Market Outlook

 

As we enter September 2021, the developed equity market has posted seven consecutive months of gains. This is the longest since 2017-18 and continues to push historic highs in just about every valuation metric. As inflation continues to run hot, there is the risk of a rising interest rate environment as more global central banks are tightening rates instead of cutting them. The US’s and China’s growth show signs of peaking in the recovery and will be critical in the ongoing global recovery. These factors may lead to increased volatility as future uncertainty increases amongst investors. We believe this type of volatility and uncertainty is well-suited for risk managed strategies, specifically the Fund.

 

Eric Leake, CMT Garrett Waters
President, Anchor Capital CEO, Anchor Capital

  

1The MSCI All Country World Index is a market-capitalization weighted index designed to provide a broad measure of equity-market performance throughout the world. The MSCI ACWI is comprised of large and mid-capitalization stocks from both developed and emerging markets.

 

5545-NLD-09292021 www.anchor-capital.com

15 Enterprise, Suite 450

Aliso Viejo, CA 92656 USA

(800) 290-8633 main

(949) 382-1497 fax

6

 

(LOGO)

 

Anchor Risk Managed Municipal Strategies Fund

Annual Shareholder Report

 

August 31, 2021

 

It is our pleasure to present the annual report for the Anchor Risk Managed Municipal Strategies Fund for the fiscal year ended August 31, 2021. On behalf of the entire team at Anchor Capital, we would like to thank you for your investment in the Fund.

 

Performance

 

Concentrated vaccination programs, continued support from global central banks and loose monetary policy provided a favorable tailwind to the municipal markets as they continued their arduous recovery from the lasting damages of COVID-19. As the markets continued to all-time highs, questions started to arise concerning the Federal Reserve’s sustained involvement and the impact on the economy. Inflation levels not seen in decades have caught investors off guard, forcing them to rethink their portfolio composition.

 

The Advisor Class returned 10.80% for the fiscal year ended August 31, 2021, significantly outperforming the Bloomberg Municipal Bond Index1 and the Morningstar Intermediate-Term Municipal Bond Category. The Bloomberg Municipal Bond Index returned 3.40%, and the Morningstar Intermediate-Term Municipal Bond Category returned 3.69%.

 

Market and Fund Performance Commentary

 

As the containment of COVID-19 and the reopening of the economy progressed throughout the fiscal year, municipal bonds have been a prominent benefactor. Economic activity began to recover as pent-up demand and savings unwind. In Q1 2021, the American Rescue Plan was passed and provided a windfall of $350 billion in direct aid to local municipalities. This led to continued confidence and inflows into the municipal space, with higher-yielding bonds performing strongest.

 

With deficit spending on par with the previous year, the Federal Reserve balance sheet continues to surpass levels never seen- leaving many investors worried about the gradual unwind and potential rising rate environment. Interest-rate volatility remained elevated throughout the year as all eyes focused on the Federal Reserve and its policy stance. Inflation fears took the headlines, as government officials assured it is only transitory due to the temporary bottleneck constraints caused by COVID-19.

 

5545-NLD-09292021 www.anchor-capital.com

15 Enterprise, Suite 450

Aliso Viejo, CA 92656 USA

(800) 290-8633 main

(949) 382-1497 fax

7

 

(LOGO)

 

Market Outlook

 

Flows into the municipal space remain strong while supply is relatively tight. Although that will be a favorable backdrop for the sector, risk remains elevated. The $1 trillion infrastructure bill remains in a state of limbo as the debt ceiling deadline comes closer. This will remain critical to municipalities, as much of the package is in their direct benefit and would lessen municipal issuance. The current uncertainties surrounding the path of inflation and the resiliency of COVID-19 could lead to interest-rate volatility remaining elevated. Removing the proverbial “liquidity punch bowl” by the Federal Reserve may create a drag on the bond market, and rising rates could pose a threat. We believe this type of volatility and uncertainty is well-suited for risk managed strategies, specifically the Fund.

 

Eric Leake, CMT Garrett Waters
President, Anchor Capital CEO, Anchor Capital

 

1The Bloomberg Municipal Bond Index covers the USD-denominated long-term tax exempt bond market. The index has four main sectors: state and local general obligation bonds, revenue bonds, insured bonds, and prefunded bonds

 

5545-NLD-09292021 www.anchor-capital.com

15 Enterprise, Suite 450

Aliso Viejo, CA 92656 USA

(800) 290-8633 main

(949) 382-1497 fax

8

 

Anchor Risk Managed Credit Strategies Fund 

Portfolio Review (Unaudited) 

August 31, 2021

 

The Fund’s Institutional Class performance figures for the periods ended August 31, 2021, compared to its benchmark:

 

(LINE GRAPH)

 

            Since   Since
    One   Five   Inception   Inception
    Year     Years     9/29/2015*     9/11/2020**
Anchor Risk Managed Credit Strategies Fund - Institutional Class   4.57%   3.00%   3.07%   N/A
Anchor Risk Managed Credit Strategies Fund - Advisor Class   N/A   N/A   N/A   5.92%
HFRX Absolute Return Index***   4.78%   2.41%   2.21%   4.79%

 

 
*The Institutional Class commenced operations on September 29, 2015.

 

**The Advisor Class commenced operations on September 11, 2020.

 

***The HFRX Absolute Return Index is designed to be representative of the overall composition of the Hedge Fund Universe. It is comprised of all eligible hedge fund strategies including, but not limited to, convertible arbitrage, distressed securities, equity hedge, equity market neutral, event driven, macro, merger arbitrage, and relative value arbitrage. As a component of the optimization process, the index selects constituents which characteristically exhibit lower volatilities and lower correlations to standard directional benchmarks of equity market and hedge fund industry performance. Hedge Fund Research, Inc. (HFR) utilizes a UCITSIII compliant methodology to construct the HFRX Hedge Fund Indices. The methodology is based on defined and predetermined rules and objective criteria to select and rebalance components to maximize representation of the Hedge Fund Universe. HFRX Indices utilize state-of-the-art quantitative techniques and analysis, multi-level screening, cluster analysis, Monte-Carlo simulations and optimization techniques to ensure that each index is a pure representation of its corresponding investment focus. Investors cannot invest directly in an index, and unlike the Fund, returns do not reflect any fees, expenses or sales charges.

 

Past performance is not predictive of future results. The investment return and principal value of an investment will fluctuate. An investor’s shares, when redeemed, may be worth more or less than the original cost. Total return is calculated assuming reinvestment of all dividends and distributions. The returns shown do not reflect the deduction of taxes that a shareholder would have to pay on Fund distributions or the redemption of Fund shares. The adviser has contractually agreed to reduce its fees and/or absorb expenses of the Fund through December 31, 2021 (exclusive of any front-end or contingent deferred loads, brokerage fees and commissions, fees and expenses associated with investments in other collective investment vehicles or derivative instruments (including for example, options and swap fees and expenses), acquired fund fees and expenses, borrowing costs (such as interest and dividend expense on securities sold short), taxes and extraordinary expenses, such as litigation) to 2.25% of the Institutional Class’s average daily net assets of the Fund and 2.00% of the Advisor Class’s average daily net assets of the Fund. For performance information current to the most recent month-end, please call 1-844-594-1226. 

9

 

Anchor Risk Managed Credit Strategies Fund 

Portfolio Review (Unaudited) (Continued) 

August 31, 2021

 

Per the fee table in the Fund’s Prospectus dated December 29, 2020, the Fund’s Total Annual Operating Expense Ratio is 3.31% for Institutional Class and 3.06% for Advisor Class, respectively. Updated information regarding the Fund’s expense ratio is available in the Financial Highlights. 

 

PORTFOLIO COMPOSITION (Unaudited)
 
   % of Net Assets 
Exchange-Traded Funds   80.7%
Money Market Fund   9.7%
Cash & Other Assets Less Liabilities   9.6%
Total   100.0%

 

Please refer to the Schedule of Investments in this report for a detailed listing of the Fund’s holdings.

 

10

 

Anchor Risk Managed Equity Strategies Fund 

Portfolio Review (Unaudited) 

August 31, 2021

 

The Fund’s Institutional Class performance figures for the periods ended August 31, 2021, compared to its benchmark:

 

(LINE GRAPH)

 

    One   Three   Since Inception   Since Inception
    Year     Years     9/6/2016 *     4/30/2020 **
Anchor Risk Managed Equity Strategies Fund - Institutional Class   15.47%   14.78%   14.47%   N/A
Anchor Risk Managed Equity Strategies Fund - Advisor Class   15.85%   N/A   N/A   27.26%
S&P 500 Total Return Index***   31.17%   18.07%   17.91%   41.25%

 

 
*The Institutional Class commenced operations on September 6, 2016.

 

**The Advisor Class commenced operations on April 30, 2020.

 

***The S&P 500 Total Return Index is an unmanaged market capitalization-weighted index which is comprised of 500 of the largest U.S. domiciled companies and includes the reinvestment of all dividends. Investors cannot invest directly in an index or benchmark.

 

Past performance is not predictive of future results. The investment return and principal value of an investment will fluctuate. An investor’s shares, when redeemed, may be worth more or less than the original cost. Total return is calculated assuming reinvestment of all dividends and distributions. The returns shown do not reflect the deduction of taxes that a shareholder would have to pay on Fund distributions or the redemption of Fund shares. The adviser has contractually agreed to reduce its fees and/or absorb expenses of the Fund through December 31, 2021 (exclusive of any front-end or contingent deferred loads, brokerage fees and commissions, fees and expenses associated with investments in other collective investment vehicles or derivative instruments (including for example, options and swap fees and expenses), acquired fund fees and expenses, borrowing costs (such as interest and dividend expense on securities sold short), taxes and extraordinary expenses, such as litigation) to 2.25% of the Institutional Class’s average daily net assets of the Fund and 2.00% of the Advisor Class’s average daily net assets of the Fund. For performance information current to the most recent month-end, please call 1-844-594-1226.

 

Per the fee table in the Fund’s Prospectus dated December 29, 2020, the Fund’s Total Annual Operating Expense Ratio is 2.33% for Institutional Class and 2.03% for Advisor Class, respectively. Updated information regarding the Fund’s expense ratio is available in the Financial Highlights.

 

PORTFOLIO COMPOSITION (Unaudited)
 
   % of Net Assets 
Exchange-Traded Funds   60.5%
Money Market Fund   32.5%
Cash & Other Assets Less Liabilities   7.0%
Total   100.0%

 

Please refer to the Schedule of Investments in this report for a detailed listing of the Fund’s holdings.

 

11

 

Anchor Risk Managed Global Strategies Fund 

Portfolio Review (Unaudited) 

August 31, 2021

 

The Fund’s Institutional Class performance figures for the periods ended August 31, 2021, compared to its benchmark:

 

(LINE GRAPH)

 

    One   Since Inception   Since Inception
    Year   1/15/2019 *   7/15/2020 **
Anchor Risk Managed Global Strategies Fund - Institutional Class   11.76%   12.06%   N/A
Anchor Risk Managed Global Strategies Fund - Advisor Class   11.94%   N/A   12.37%
MSCI All Country World Index ***   28.64%   20.63%   32.25%

 

 
*The Institutional Class commenced operations on January 15, 2019.

 

**The Advisor Class commenced operations on July 15, 2020.

 

***The MSCI All Country World Index is composed of large and mid-capitalization developed and emerging market equities. Investors cannot invest directly in an index or benchmark.

 

Past performance is not predictive of future results. The investment return and principal value of an investment will fluctuate. An investor’s shares, when redeemed, may be worth more or less than the original cost. Total return is calculated assuming reinvestment of all dividends and distributions. The returns shown do not reflect the deduction of taxes that a shareholder would have to pay on Fund distributions or the redemption of Fund shares. The adviser has contractually agreed to reduce its fees and/or absorb expenses of the Fund through December 31, 2021 (exclusive of any front-end or contingent deferred loads, brokerage fees and commissions, fees and expenses associated with investments in other collective investment vehicles or derivative instruments (including for example, options and swap fees and expenses), acquired fund fees and expenses, borrowing costs (such as interest and dividend expense on securities sold short), taxes and extraordinary expenses, such as litigation) to 2.25% of the Institutional Class’s average daily net assets of the Fund and 2.00% of the Advisor Class’s average daily net assets of the Fund. For performance information current to the most recent month-end, please call 1-844-594-1226.

 

Per the fee table in the Fund’s Prospectus dated December 29, 2020, the Fund’s Total Annual Operating Expense Ratio is 3.03% for Institutional Class and 2.78% for Advisor Class, respectively. Updated information regarding the Fund’s expense ratio is available in the Financial Highlights.

 

PORTFOLIO COMPOSITION (Unaudited)
 
   % of Net Assets 
Money Market Fund   73.1%
Cash & Other Assets Less Liabilities   26.9%
Total   100.0%

 

Please refer to the Schedule of Investments in this report for a detailed listing of the Fund’s holdings.

 

12

 

Anchor Risk Managed Municipal Strategies Fund 

Portfolio Review (Unaudited) 

August 31, 2021

 

The Fund’s Institutional Class performance figures for the periods ended August 31, 2021, compared to its benchmark:

 

(LINE GRAPH)

 

    One   Three   Since Inception   Since Inception
      Year     Year     9/6/2016 *     7/15/2020 **
Anchor Risk Managed Municipal Strategies Fund - Institutional Class   11.52%   6.11%   3.38%   N/A
Anchor Risk Managed Municipal Strategies Fund - Advisor Class   10.80%   N/A   N/A   9.51%
Bloomberg US Municipal Bond Index***   3.40%   5.09%   3.34%   3.41%

 

 
*The Institutional Class commenced operations on September 6, 2016.

 

**The Advisor Class commenced operations on July 15, 2020.

 

***The Bloomberg US Municipal Bond Index covers the USD-denominated long-term tax exempt bond market. Investors cannot invest directly in an index or benchmark. The index has four main sectors: state and local general obligation bonds, revenue bonds, insured bonds and pre-refunded bonds.

 

Past performance is not predictive of future results. The investment return and principal value of an investment will fluctuate. An investor’s shares, when redeemed, may be worth more or less than the original cost. Total return is calculated assuming reinvestment of all dividends and distributions. The returns shown do not reflect the deduction of taxes that a shareholder would have to pay on Fund distributions or the redemption of Fund shares. The adviser has contractually agreed to reduce its fees and/or absorb expenses of the Fund through December 31, 2021 (exclusive of any front-end or contingent deferred loads, brokerage fees and commissions, fees and expenses associated with investments in other collective investment vehicles or derivative instruments (including for example, options and swap fees and expenses), acquired fund fees and expenses, borrowing costs (such as interest and dividend expense on securities sold short), taxes and extraordinary expenses, such as litigation) to 2.25% of the Institutional Class’s average daily net assets of the Fund and 2.00% of the Advisor Class’s average daily net assets of the Fund. For performance information current to the most recent month-end, please call 1-844-594-1226.

 

Per the fee table in the Fund’s Prospectus dated December 29, 2020, the Fund’s Total Annual Operating Expense Ratio is 3.93% for Institutional Class and 3.68% for Advisor Class, respectively. Updated information regarding the Fund’s expense ratio is available in the Financial Highlights. 

 

PORTFOLIO COMPOSITION (Unaudited)
 
   % of Net Assets 
Closed-End Funds   106.8%
Money Market Fund   2.1%
Liabilities In Excess of Other Assets   (8.9)%
Total   100.0%

 

Please refer to the Schedule of Investments in this report for a detailed listing of the Fund’s holdings.

 

13

 

ANCHOR RISK MANAGED CREDIT STRATEGIES FUND
SCHEDULE OF INVESTMENTS
August 31, 2021

 

Shares      Value 
     EXCHANGE-TRADED FUNDS — 80.7%     
     FIXED INCOME - 80.7%     
 210,000   iShares iBoxx High Yield Corporate Bond ETF(a)  $18,498,900 
 180,000   SPDR Bloomberg Barclays High Yield Bond ETF   19,800,000 
         38,298,900 
           
     TOTAL EXCHANGE-TRADED FUNDS (Cost $38,083,350)   38,298,900 
           
     SHORT-TERM INVESTMENTS — 9.7%     
     MONEY MARKET FUND - 9.7%     
 4,612,609   First American Government Obligations Fund, Class X, 0.03% (Cost $4,612,609)(b)   4,612,609 
           
     TOTAL INVESTMENTS - 90.4% (Cost $42,695,959)  $42,911,509 
     CASH & OTHER ASSETS LESS LIABILITIES - 9.6%   4,571,060 
     NET ASSETS - 100.0%  $47,482,569 

 

OPEN FUTURES CONTRACTS

Number of                
Contracts   Open Long Futures Contracts  Expiration   Notional Amount   Unrealized Appreciation 
 30   NASDAQ 100 E-Mini  September 2021   $9,349,500   $93,717 
     TOTAL FUTURES CONTRACTS              

 

ETF- Exchange-Traded Fund

 

(a)All or a portion of security segregated as collateral.

 

(b)Rate disclosed is the seven-day effective yield as of August 31, 2021.

 

See accompanying notes to financial statements.

14

 

ANCHOR RISK MANAGED EQUITY STRATEGIES FUND
SCHEDULE OF INVESTMENTS
August 31, 2021

 

Shares      Value 
     EXCHANGE-TRADED FUNDS — 60.5%     
     EQUITY - 60.5%     
 391,775   Invesco QQQ Trust Series 1  $148,854,911 
 100,000   SPDR S&P 500 ETF Trust(a)   45,156,000 
         194,010,911 
           
     TOTAL EXCHANGE-TRADED FUNDS (Cost $104,516,462)   194,010,911 
           
     SHORT-TERM INVESTMENTS — 32.5%     
     MONEY MARKET FUND - 32.5%     
 104,189,606   First American Government Obligations Fund, Class X, 0.03% (Cost $104,189,606)(b)   104,189,606 
           
     TOTAL INVESTMENTS - 93.0% (Cost $208,706,068)  $298,200,517 
     CASH & OTHER ASSETS LESS LIABILITIES - 7.0%   22,269,551 
     NET ASSETS - 100.0%  $320,470,068 

 

OPEN FUTURES CONTRACTS

Number of               
Contracts   Open Long Futures Contracts  Expiration  Notional Amount   Unrealized Appreciation 
 250   NASDAQ 100 E-Mini  September 2021  $77,912,500   $930,810 
 250   S&P 500 E-Mini  September 2021   56,506,250    1,771,975 
     TOTAL FUTURES CONTRACTS          $2,702,785 

 

ETF- Exchange-Traded Fund

 

(a)All or a portion of security segregated as collateral.

 

(b)Rate disclosed is the seven-day effective yield as of August 31, 2021.

 

See accompanying notes to financial statements.

15

 

ANCHOR RISK MANAGED GLOBAL STRATEGIES FUND
SCHEDULE OF INVESTMENTS
August 31, 2021

 

Shares      Value 
     SHORT-TERM INVESTMENTS — 73.1%     
     MONEY MARKET FUND - 73.1%     
 27,567,630   First American Government Obligations Fund, Class X, 0.03% (Cost $27,567,630)(a)  $27,567,630 
           
     TOTAL INVESTMENTS - 73.1% (Cost $27,567,630)  $27,567,630 
     CASH & OTHER ASSETS LESS LIABILITIES - 26.9%   10,147,795 
     NET ASSETS - 100.0%  $37,715,425 

 

OPEN FUTURES CONTRACTS

Number of               
Contracts   Open Long Futures Contracts  Expiration  Notional Amount   Unrealized Appreciation 
 125   MSCI EAFE Mini  September 2021  $14,696,875   $140,141 
 40   NASDAQ 100 E-Mini  September 2021   12,466,000    159,331 
 40   S&P 500 E-Mini  September 2021   9,041,000    586,416 
     TOTAL FUTURES CONTRACTS          $885,888 

 

(a)Rate disclosed is the seven-day effective yield as of August 31, 2021.

 

See accompanying notes to financial statements.

16

 

ANCHOR RISK MANAGED MUNICIPAL STRATEGIES FUND
SCHEDULE OF INVESTMENTS
August 31, 2021

 

Shares      Fair Value 
     CLOSED-END FUNDS — 106.8%     
     FIXED INCOME - 106.8%     
 40,138   BlackRock California Municipal Income Trust  $597,655 
 67,727   BlackRock MuniHoldings California Quality Fund, Inc.   1,072,118 
 56,377   BlackRock MuniYield California Fund, Inc.   869,333 
 70,600   BlackRock MuniYield California Quality Fund, Inc.   1,124,658 
 39,355   Invesco California Value Municipal Income Trust   551,364 
 124,332   Nuveen AMT-Free Municipal Credit Income Fund   2,261,599 
 141,950   Nuveen AMT-Free Quality Municipal Income Fund   2,254,166 
 71,659   Nuveen California AMT-Free Quality Municipal   1,186,673 
 132,501   Nuveen California Quality Municipal Income Fund(a)   2,120,016 
 98,390   Nuveen Municipal Credit Income Fund   1,711,002 
 101,467   Nuveen Municipal High Income Opportunity Fund(a)   1,557,518 
 115,680   Nuveen Municipal Value Fund, Inc.   1,361,554 
 123,373   Nuveen Quality Municipal Income Fund   2,007,279 
         18,674,935 
           
     TOTAL CLOSED-END FUNDS (Cost $16,424,991)   18,674,935 
           
     SHORT-TERM INVESTMENTS — 2.1%     
     MONEY MARKET FUND - 2.1%     
 368,454   First American Government Obligations Fund, Class X, 0.03% (Cost $368,454)(b)   368,454 
           
     TOTAL INVESTMENTS - 108.9% (Cost $16,793,445)  $19,043,389 
     LIABILITIES IN EXCESS OF OTHER ASSETS - (8.9)%   (1,558,717)
     NET ASSETS - 100.0%  $17,484,672 

 

(a)All or a portion of security segregated as collateral.

 

(b)Rate disclosed is the seven-day effective yield as of August 31, 2021.

 

See accompanying notes to financial statements.

17

 

Anchor Funds
STATEMENTS OF ASSETS AND LIABILITIES
August 31, 2021

 

   Anchor Risk Managed   Anchor Risk   Anchor Risk   Anchor Risk Managed 
   Credit Strategies   Managed Equity   Managed Global   Municipal Strategies 
   Fund   Strategies Fund   Strategies Fund   Fund 
ASSETS                
Investment securities:                    
At cost  $42,695,959   $208,706,068   $27,567,630   $16,793,445 
At value  $42,911,509   $298,200,517   $27,567,630   $19,043,389 
Deposits with brokers:                    
Interactive Brokers LLC   4,229,202    38,687,556    5,105,782    300,000 
Securities collateral pledge - Jefferies LLC   1,579,060        4,040,190     
Receivable for Fund shares sold   335,608    489,183    209,229    157,578 
Unrealized appreciation for future contracts   93,717    2,702,785    885,888     
Dividends and interest receivable   174    2,456    597    63,822 
Prepaid expenses   21,681    37,394    10,215    16,712 
TOTAL ASSETS   49,170,951    340,119,891    37,819,531    19,581,501 
                     
LIABILITIES                    
Payable for Fund shares redeemed   1,503,929    19,066,019    22,101    2,038,772 
Due to broker - Jefferies LLC   71,614            5,631 
Investment advisory fees payable   57,183    458,908    47,318    19,543 
Payable to related parties   8,154    28,662    6,322    5,599 
Distribution (12b-1) fees payable   8,406    38,792    6,459    3,617 
Accrued expenses and other liabilities   39,096    57,442    21,906    23,667 
TOTAL LIABILITIES   1,688,382    19,649,823    104,106    2,096,829 
NET ASSETS  $47,482,569   $320,470,068   $37,715,425   $17,484,672 
                     
Net Assets Consist Of:                    
Paid in capital   46,134,757    239,638,931    33,333,777    18,154,351 
Accumulated earnings (deficits)   1,347,812    80,831,137    4,381,648    (669,679)
NET ASSETS  $47,482,569   $320,470,068   $37,715,425   $17,484,672 
Institutional Class                    
Net Assets  $39,937,264   $176,805,751   $30,938,420   $15,698,697 
Shares of beneficial interest outstanding ($0 par value, unlimited shares authorized)   3,698,771    11,611,157    2,489,409    1,421,287 
Net asset value, offering and redemption price per share (Net assets/Shares of Beneficial Interest)  $10.80   $15.23   $12.43   $11.05 
                     
Advisor Class                    
Net Assets  $7,545,305   $143,664,317   $6,777,005   $1,785,975 
Shares of beneficial interest outstanding ($0 par value, unlimited shares authorized)   698,142    9,404,935    544,133    161,748 
Net asset value, offering and redemption price per share (Net assets/Shares of Beneficial Interest)  $10.81   $15.28   $12.45   $11.04 

 

See accompanying notes to financial statements.

18

 

Anchor Funds  
STATEMENTS OF OPERATIONS  
For the Year Ended August 31, 2021  

 

       Anchor Risk Managed   Anchor Risk   Anchor Risk Managed 
   Anchor Risk Managed   Equity Strategies   Managed Global   Municipal Strategies 
   Credit Strategies Fund   Fund   Strategies Fund   Fund 
INVESTMENT INCOME                    
Dividends  $1,644,443   $1,239,384   $47,896   $932,065 
Interest   3,984    70,711    12,364    866 
TOTAL INVESTMENT INCOME   1,648,427    1,310,095    60,260    932,931 
                     
EXPENSES                    
Investment advisory fees   734,963    4,583,551    489,548    383,922 
Margin interest expense   117,967        4,946    5,692 
Distribution (12b-1) fees - Institutional Class   109,717    528,431    71,453    57,292 
Administrative services fees   50,410    241,399    37,003    30,972 
Accounting services fees   34,322    63,901    31,336    30,271 
Registration fees   28,018    73,193    28,126    30,937 
Legal fees   15,674    12,605    14,507    11,944 
Transfer agent fees   15,007    33,015    16,651    18,657 
Audit fees   14,996    14,996    14,975    14,995 
Printing and postage expenses   13,829    41,689    7,093    7,121 
Trustees’ fees and expenses   11,802    15,196    11,483    11,526 
Compliance officer fees   8,948    22,248    7,429    7,374 
Custodian fees   7,663    30,692    8,333    7,549 
Third party administrative services fees   5,437    91,044    5,268    4,267 
Insurance expense   2,123    8,739    505    994 
Miscellaneous expense   3,293    6,302    4,467    3,220 
TOTAL EXPENSES   1,174,169    5,767,001    753,123    626,733 
Less: Fees waived by the adviser   (27,523)       (63,822)   (84,334)
NET EXPENSES   1,146,646    5,767,001    689,301    542,399 
NET INVESTMENT INCOME (LOSS)   501,781    (4,456,906)   (629,041)   390,532 
                     
REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS                    
Net realized gain (loss) from:                    
Investments   787,352        2,694,425    563,249 
Distributions of capital gains from underlying investment companies               10,867 
Futures contracts   1,178,655    4,990,911    3,099,450     
Securities sold short   (503,677)       (132,866)   (15,681)
Net change in unrealized appreciation (depreciation) on:                    
Investments   81,060    43,553,299    (2,027,934)   1,674,362 
Futures contracts   93,717    3,008,997    951,776     
NET REALIZED AND UNREALIZED GAIN ON INVESTMENTS   1,637,107    51,553,207    4,584,851    2,232,797 
                     
NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS  $2,138,888   $47,096,301   $3,955,810   $2,623,329 

 

See accompanying notes to financial statements.

19

 

Anchor Funds
STATEMENTS OF CHANGES IN NET ASSETS

 

   Anchor Risk Managed   Anchor Risk Managed 
   Credit Strategies Fund   Equity Strategies Fund 
   For the   For the   For the   For the 
   Year Ended   Year Ended   Year Ended   Year Ended 
   August 31, 2021   August 31, 2020   August 31, 2021   August 31, 2020 
FROM OPERATIONS:                    
Net investment income (loss)  $501,781   $313,420   $(4,456,906)  $(2,006,236)
Net realized gain (loss) from investments   1,462,330    2,933,684    4,990,911    (8,062,127)
Net change in unrealized appreciation (depreciation) on investments   174,777    (53,585)   46,562,296    45,108,053 
Net increase in net assets resulting from operations   2,138,888    3,193,519    47,096,301    35,039,690 
                     
DISTRIBUTIONS TO SHAREHOLDERS:                    
Institutional Class:                    
Distributable earnings   (696,886)   (545,344)       (14,948,386)
Return of capital       (16,249)        
Advisor Class *:                    
Distributable earnings   (4,423)            
Net decrease in net assets from distributions to shareholders   (701,309)   (561,593)       (14,948,386)
                     
FROM SHARES OF BENEFICIAL INTEREST:                    
Institutional Class:                    
Proceeds from shares sold   22,421,301    35,845,692    121,900,391    187,309,426 
Reinvestment of dividends   680,185    555,158        14,642,216 
Payments for shares redeemed   (28,037,080)   (18,591,088)   (190,055,053)   (132,136,675)
Advisor Class *:                    
Proceeds from shares sold   7,857,905        153,695,100    13,863,077 
Reinvestment of dividends   4,423             
Payments for shares redeemed   (409,407)       (40,277,224)   (20,049)
Net increase in net assets from shares of beneficial interest   2,517,327    17,809,762    45,263,214    83,657,995 
                     
TOTAL INCREASE IN NET ASSETS   3,954,906    20,441,688    92,359,515    103,749,299 
                     
NET ASSETS                    
Beginning of Year   43,527,663    23,085,975    228,110,553    124,361,254 
End of Year  $47,482,569   $43,527,663   $320,470,068   $228,110,553 
                     
SHARE ACTIVITY                    
Institutional Class:                    
Shares sold   2,126,490    3,592,052    9,203,978    15,744,567 
Shares reinvested   64,720    57,377        1,277,680 
Shares redeemed   (2,646,572)   (1,874,273)   (13,725,823)   (11,204,445)
Net increase (decrease) in shares of beneficial interest outstanding   (455,362)   1,775,156    (4,521,845)   5,817,802 
                     
Advisor Class *:                    
Shares sold   736,308         10,995,832    1,167,819 
Shares reinvested   421              
Shares redeemed   (38,587)        (2,757,184)   (1,532)
Net increase in shares of beneficial interest outstanding   698,142         8,238,648    1,166,287 

 

*Advisor Class of the Anchor Risk Managed Credit Strategies Fund and Anchor Risk Managed Equity Fund commenced operations on September 11, 2020 and April 30, 2020, respectively.

 

See accompanying notes to financial statements.

20

 

Anchor Funds
STATEMENTS OF CHANGES IN NET ASSETS (Continued)

 

   Anchor Risk Managed   Anchor Risk Managed 
   Global Strategies Fund   Municipal Strategies Fund 
   For the   For the   For the   For the 
   Year Ended   Year Ended   Year Ended   Year Ended 
   August 31, 2021   August 31, 2020   August 31, 2021   August 31, 2020 
FROM OPERATIONS:                    
Net investment income (loss)  $(629,041)  $(32,651)  $390,532   $363,911 
Net realized gain (loss) from investments   5,661,009    (308,770)   547,568    (146,125)
Distributions of capital gains from underlying investment companies           10,867    14,498 
Net change in unrealized appreciation (depreciation) on investments   (1,076,158)   1,823,529    1,674,362    (1,197,332)
Net increase (decrease) in net assets resulting from operations   3,955,810    1,482,108    2,623,329    (965,048)
                     
DISTRIBUTIONS TO SHAREHOLDERS:                    
Institutional Class:                    
Distributable earnings   (348,367)   (942,628)   (355,315)   (349,059)
Advisor Class *:                    
Distributable earnings           (19,154)    
Net decrease in net assets from distributions to shareholders   (348,367)   (942,628)   (374,469)   (349,059)
                     
FROM SHARES OF BENEFICIAL INTEREST:                    
Institutional Class:                    
Proceeds from shares sold   18,984,230    15,249,353    8,798,770    31,991,911 
Reinvestment of dividends   324,142    874,981    350,003    345,659 
Payments for shares redeemed   (12,728,195)   (5,506,064)   (22,624,896)   (22,350,522)
Advisor Class *:                    
Proceeds from shares sold   7,356,493    11    4,484,417    10 
Reinvestment of dividends           19,154     
Payments for shares redeemed   (947,048)       (2,889,722)    
Net increase (decrease) in net assets from shares of beneficial interest   12,989,622    10,618,281    (11,862,274)   9,987,058 
                     
TOTAL INCREASE (DECREASE) IN NET ASSETS   16,597,065    11,157,761    (9,613,414)   8,672,951 
                     
NET ASSETS                    
Beginning of Year   21,118,360    9,960,599    27,098,086    18,425,135 
End of Year  $37,715,425   $21,118,360   $17,484,672   $27,098,086 
                     
SHARE ACTIVITY                    
Institutional Class:                    
Shares sold   1,684,444    1,396,445    847,933    3,152,628 
Shares reinvested   29,202    81,698    33,704    33,682 
Shares redeemed   (1,100,201)   (502,143)   (2,153,310)   (2,220,283)
Net increase (decrease) in shares of beneficial interest outstanding   613,445    976,000    (1,271,673)   966,027 
                     
Advisor Class *:                    
Shares sold   624,426    1    426,818    1 
Shares reinvested           1,781     
Shares redeemed   (80,294)       (266,852)    
Net increase in shares of beneficial interest outstanding   544,132    1    161,747    1 

 

*Advisor Class of the Anchor Risk Managed Global Strategies Fund and the Anchor Risk Managed Municipal Strategies Fund commenced operations on July 15, 2020.

 

See accompanying notes to financial statements.

21

 

Anchor Risk Managed Credit Strategies Fund
FINANCIAL HIGHLIGHTS

 

Per Share Data and Ratios for a Share of Beneficial Interest Outstanding Throughout Each Year Presented.

 

   Institutional Class * 
   For the   For the   For the   For the   For the 
   Year Ended   Year Ended   Year Ended   Year Ended   Year Ended 
   August 31, 2021   August 31, 2020   August 31, 2019   August 31, 2018   August 31, 2017 
                     
Net asset value, beginning of year  $10.48   $9.70   $9.73   $10.06   $10.26 
Activity from investment operations:                         
Net investment income (loss) (1)(4)(9)   0.12    0.10    0.00 (5)   (0.05)   0.23 
Net realized and unrealized gain (loss) on investments   0.35    0.88        (0.11)   (0.01)
Total from investment operations   0.47    0.98    0.00    (0.16)   0.22 
Less distributions:                         
From net investment income   (0.14)   (0.19)   (0.01)   (0.13)   (0.28)
From net realized gains   (0.01)           (0.04)   (0.14)
From return of capital       (0.01)   (0.02)        
Total distributions   (0.15)   (0.20)   (0.03)   (0.17)   (0.42)
Paid-in capital from redemption fees (1)               0.00 (5)   0.00 (5)
Net asset value, end of year  $10.80   $10.48   $9.70   $9.73   $10.06 
Total return (2)   4.57%   10.32%   (0.04)%   (1.65)%   2.22%
Net assets, end of year (000s)  $39,937   $43,528   $23,086   $40,086   $90,784 
Ratio of gross expenses to average net assets including interest and dividend expense (3)(6)(8)   2.56%   3.04%   4.02%   3.94%   2.63%
Ratio of net expenses to average net assets including interest and dividend expense (3)(7)   2.50%   2.91%   3.85%   3.94%   2.63%
Ratio of net investment income (loss) to average net assets (3)(4)   1.11%   1.03%   (0.01)%   (0.49)%   2.23%
Portfolio turnover rate   727%   1,114%   1,816%   1,409%   1,009%

 

 
* Formerly the Investor Class through July 31, 2017.
   
(1) Per share amounts calculated using the average shares method, which more appropriately presents the per share data for the year.
   
(2) Total returns are historical in nature and assume changes in share price, and reinvestment of dividends and capital gains distributions, if any.
   
(3) The ratios of expenses to average net assets and net investment income (loss) to average net assets do not reflect the expenses of the underlying investment companies in which the Fund invests.
   
(4) Recognition of net investment income (loss) by the Fund is affected by the timing and declaration of dividends by the underlying investment companies in which the Fund invests.
   
(5) Amount is less than $0.005.

 

(6) Ratio of gross expenses to average net assets excluding interest expense and dividend expense (3)   2.31%   2.38%   2.42%   2.22%   2.15%
                            
(7) Ratio of net expenses to average net assets excluding interest expense and dividend expense (3)   2.25%   2.25%   2.25%   2.22%   2.15%

 

(8) Represents the ratio of expenses to average net assets absent fee waivers and/or expense reimbursements by the adviser.
   
(9) Does not include the expenses of the underlying investment companies in which the Fund invests.

 

See accompanying notes to financial statements.

22

 

Anchor Risk Managed Credit Strategies Fund
FINANCIAL HIGHLIGHTS

 

Per Share Data and Ratios for a Share of Beneficial Interest Outstanding Throughout the Period Presented.

 

   Advisor Class 
   For the 
   Period* Ended 
   August 31, 2021 
     
Net asset value, beginning of period  $10.37 
Activity from investment operations:     
Net investment income (1)(6)(11)   0.07 
Net realized and unrealized gain on investments   0.54 
Total from investment operations   0.61 
Less distributions:     
From net investment income   (0.16)
From net realized gains   (0.01)
Total distributions   (0.17)
Net asset value, end of period  $10.81 
Total return (2)   5.92(3)
Net assets, end of period (000s)  $7,545 
Ratio of gross expenses to average net assets including interest and dividend expense (5)(7)(9)   2.44(4)
Ratio of net expenses to average net assets including interest and dividend expense (5)(8)   2.33(4)
Ratio of net investment income to average net assets (5)(6)   0.64(4)
Portfolio turnover rate   727(10)

 

 
* For the period September 11, 2020 (commencement of operations) through August 31, 2021.
   
(1) Per share amounts calculated using the average shares method, which more appropriately presents the per share data for the period.
   
(2) Total returns are historical in nature and assume changes in share price, and reinvestment of dividends and capital gains distributions, if any.
   
(3) Not annualized.
   
(4) Annualized.
   
(5) The ratios of expenses to average net assets and net investment income to average net assets do not reflect the expenses of the underlying investment companies in which the Fund invests.
   
(6) Recognition of net investment income (loss) by the Fund is affected by the timing and declaration of dividends by the underlying investment companies in which the Fund invests.

 

(7) Ratio of gross expenses to average net assets excluding interest expense and dividend expense (5)   2.11%
        
(8) Ratio of net expenses to average net assets excluding interest expense and dividend expense (5)   2.00%

 

(9) Represents the ratio of expenses to average net assets absent fee waivers and/or expense reimbursements by the adviser.
   
(10) The portfolio turnover rate is for the entire Fund for the year ended August 31, 2021.
   
(11) Does not include the expenses of the underlying investment companies in which the Fund invests.

 

See accompanying notes to financial statements.

23

 

Anchor Risk Managed Equity Strategies Fund
FINANCIAL HIGHLIGHTS

 

Per Share Data and Ratios for a Share of Beneficial Interest Outstanding Throughout Each Year/Period Presented.

 

   Institutional Class 
   For the   For the   For the   For the   For the Period 
   Year Ended   Year Ended   Year Ended   Year Ended   Ended 
   August 31, 2021   August 31, 2020   August 31, 2019   August 31, 2018   August 31, 2017* 
                     
Net asset value, beginning of year/period  $13.19   $12.06   $12.13   $11.05   $10.00 
Activity from investment operations:                         
Net investment loss (1)(6)(10)   (0.21)   (0.15)   (0.09)   (0.14)   (0.13)
Net realized and unrealized gain on investments   2.25    2.63    0.84    1.89    1.26 
Total from investment operations   2.04    2.48    0.75    1.75    1.13 
Less distributions:                         
From net realized gains       (1.35)   (0.82)   (0.67)   (0.09)
Total distributions       (1.35)   (0.82)   (0.67)   (0.09)
Paid-in capital from redemption fees (1)               0.00 (7)   0.01 
Net asset value, end of year/period  $15.23   $13.19   $12.06   $12.13   $11.05 
Total return (2)   15.47%   22.29%   7.08%   16.33%   11.48(3)
Net assets, end of year/period (000s)  $176,806   $212,726   $124,361   $160,260   $60,366 
Ratio of gross expenses to average net assets including interest and dividend expense (5)(8)   2.07%   2.20%   2.19%   2.19%   2.40(4)
Ratio of net expenses to average net assets including interest and dividend expense(5)(9)   2.07%   2.20%   2.19%   2.19%   2.40(4)
Ratio of net investment loss to average net assets (5)(6)   (1.58)%   (1.27)%   (0.80)%   (1.25)%   (1.24)% (4)
Portfolio turnover rate   0%   204%   1,068%   1,091%   1,576(3)

 

 
* For the period September 6, 2016 (commencement of operations) through August 31, 2017.
   
(1) Per share amounts calculated using the average shares method, which more appropriately presents the per share data for the period.
   
(2) Total returns are historical in nature and assume changes in share price, and reinvestment of dividends and capital gains distributions, if any.
   
(3) Not annualized.
   
(4) Annualized.
   
(5) The ratios of expenses to average net assets and net investment loss to average net assets do not reflect the expenses of the underlying investment companies in which the Fund invests.
   
(6) Recognition of net investment loss by the Fund is affected by the timing and declaration of dividends by the underlying investment companies in which the Fund invests.
   
(7) Amount is less than $0.005.

 

(8) Ratio of gross expenses to average net assets excluding interest expense and dividend expense (5)   2.07%   2.11%   2.10%   2.10%   2.20%
                            
(9) Ratio of net expenses to average net assets excluding interest expense and dividend expense (5)   2.07%   2.11%   2.10%   2.10%   2.20%

 

(10) Does not include the expenses of the underlying investment companies in which the Fund invests.

 

See accompanying notes to financial statements.

24

 

Anchor Risk Managed Equity Strategies Fund
FINANCIAL HIGHLIGHTS

 

Per Share Data and Ratios for a Share of Beneficial Interest Outstanding Throughout Each Year/Period Presented.

 

   Advisor Class 
   For the   For the Period 
   Year Ended   Ended 
   August 31, 2021   August 31, 2020* 
         
Net asset value, beginning of year/period  $13.19   $11.07 
Activity from investment operations:          
Net investment loss (1)(6)(10)   (0.21)   (0.06)
Net realized and unrealized gain on investments   2.30    2.18 
Total from investment operations   2.09    2.12 
Net asset value, end of year/period  $15.28   $13.19 
Total return (2)   15.85%   19.15% (3)
Net assets, end of year/period (000s)  $143,664   $15,385 
Ratio of gross expenses to average net assets including interest and dividend expense (5)(7)   1.86%   1.90% (4)
Ratio of net expenses to average net assets including interest and dividend expense (5)(8)   1.86%   1.90(4)
Ratio of net investment loss to average net assets (5)(6)   (1.49)%   (1.34)% (4)
Portfolio turnover rate   0%   204(9)

 

 
* For the period April 30, 2020 (commencement of operations) through August 31, 2020.
   
(1) Per share amounts calculated using the average shares method, which more appropriately presents the per share data for the period.
   
(2) Total returns are historical in nature and assume changes in share price, and reinvestment of dividends and capital gains distributions, if any.
   
(3) Not annualized.
   
(4) Annualized.
   
(5) The ratios of expenses to average net assets and net investment loss to average net assets do not reflect the expenses of the underlying investment companies in which the Fund invests.
   
(6) Recognition of net investment loss by the Fund is affected by the timing and declaration of dividends by the underlying investment companies in which the Fund invests.

 

(7) Ratio of gross expenses to average net assets excluding interest expense and dividend expense (5)   1.86%   1.90%
             
(8) Ratio of net expenses to average net assets excluding interest expense and dividend expense (5)   1.86%   1.90%

 

(9) The portfolio turnover rate is for the entire Fund for the year ended August 31, 2020.
   
(10) Does not include the expenses of the underlying investment companies in which the Fund invests.

 

See accompanying notes to financial statements.

25

 

Anchor Risk Managed Global Strategies Fund
FINANCIAL HIGHLIGHTS

 

Per Share Data and Ratios for a Share of Beneficial Interest Outstanding Throughout Each Year/Period Presented.

 

   Institutional Class 
   For the   For the   For the 
   Year Ended   Year Ended   Period Ended 
   August 31, 2021   August 31, 2020   August 31, 2019* 
             
Net asset value, beginning of year/period  $11.26   $11.07   $10.00 
Activity from investment operations:               
Net investment loss (1)(6)(10)   (0.24)   (0.02)   (0.16)
Net realized and unrealized gain on investments   1.55    0.98    1.23 
Total from investment operations   1.31    0.96    1.07 
Less distributions:               
From net investment income   (0.02)        
From net realized gains   (0.12)   (0.77)    
Total distributions   (0.14)   (0.77)    
Net asset value, end of year/period  $12.43   $11.26   $11.07 
Total return (2)   11.76%   8.99%   10.70(3)
Net assets, end of year/period (000s)  $30,938   $21,118   $9,961 
Ratio of gross expenses to average net assets including interest and dividend expense (5)(7)(9)   2.48%   2.92%   4.96(4)
Ratio of net expenses to average net assets including interest and dividend expenses (5)(8)   2.27%   2.25%   3.60(4)
Ratio of net investment loss to average net assets (5)(6)   (2.06)%   (0.22)%   (2.45)% (4)
Portfolio turnover rate   118%   869%   746(3)

 

 
* For the period January 15, 2019 (commencement of operations) through August 31, 2019.
   
(1) Per share amounts calculated using the average shares method, which more appropriately presents the per share data for the period.
   
(2) Total returns are historical in nature and assume changes in share price, and reinvestment of dividends and capital gains distributions, if any.
   
(3) Not annualized.
   
(4) Annualized.
   
(5) The ratios of expenses to average net assets and net investment loss to average net assets do not reflect the expenses of the underlying investment companies in which the Fund invests.
   
(6) Recognition of net investment loss by the Fund is affected by the timing and declaration of dividends by the underlying investment companies in which the Fund invests.

 

(7) Ratio of gross expenses to average net assets excluding interest expense and dividend expense (5)   2.46%   2.92%   3.61%
                  
(8) Ratio of net expenses to average net assets excluding interest expense and dividend expense (5)   2.25%   2.25%   2.25%

 

(9) Represents the ratio of expenses to average net assets absent fee waivers and/or expense reimbursements by the adviser.
   
(10) Does not include the expenses of the underlying investment companies in which the Fund invests.

 

See accompanying notes to financial statements.

26

 

Anchor Risk Managed Global Strategies Fund
FINANCIAL HIGHLIGHTS

 

Per Share Data and Ratios for a Share of Beneficial Interest Outstanding Throughout Each Year/Period Presented.

 

   Advisor Class 
   For the   For the Period 
   Year Ended   Ended 
   August 31, 2021   August 31, 2020* 
         
Net asset value, beginning of year/period  $11.26   $11.05 
Activity from investment operations:          
Net investment loss (1)(6)(13)   (0.23)   (0.00(9)
Net realized and unrealized gain on investments   1.56    0.21 
Total from investment operations   1.33    0.21 
Less distributions:          
From net investment income   (0.02)    
From net realized gains   (0.12)    
Total distributions   (0.14)    
Net asset value, end of year/period  $12.45   $11.26 
Total return (2)   11.94%   1.90% (3)
Net assets, end of year/period (000s)  $6,777   $11 (7)
Ratio of gross expenses to average net assets including interest and dividend expense (5)(8)(11)   2.15%   2.67(4)
Ratio of net expenses to average net assets including interest and dividend expense (5)(12)   2.00%   2.00(4)
Ratio of net investment loss to average net assets (5)(6)   (1.95)%   (0.00)% (4)
Portfolio turnover rate   118%   869(10)

 

 
* For the period July 15, 2020 (commencement of operations) through August 31, 2020.
   
(1) Per share amounts calculated using the average shares method, which more appropriately presents the per share data for the period.
   
(2) Total returns are historical in nature and assume changes in share price, and reinvestment of dividends and capital gains distributions, if any.
   
(3) Not annualized.
   
(4) Annualized.
   
(5) The ratios of expenses to average net assets and net investment loss to average net assets do not reflect the expenses of the underlying investment companies in which the Fund invests.
   
(6) Recognition of net investment loss by the Fund is affected by the timing and declaration of dividends by the underlying investment companies in which the Fund invests.
   
(7) Amount is actual; not presented in thousands.
   
(8) Represents the ratio of expenses to average net assets absent fee waivers and/or expense reimbursements by the adviser.
   
(9) Amount is less than $0.005.
   
(10) The portfolio turnover rate is for the entire Fund for the year ended August 31, 2020.

 

(11) Ratio of gross expenses to average net assets excluding interest expense and dividend expense (5)   2.15%   2.67%
             
(12) Ratio of net expenses to average net assets excluding interest expense and dividend expense (5)   2.00%   2.00%

 

(13) Does not include the expenses of the underlying investment companies in which the Fund invests.

 

See accompanying notes to financial statements.

27

 

Anchor Risk Managed Municipal Strategies Fund
FINANCIAL HIGHLIGHTS

 

Per Share Data and Ratios for a Share of Beneficial Interest Outstanding Throughout Each Year/Period Presented.

 

   Institutional Class 
   For the   For the   For the   For the   For the Period 
   Year Ended   Year Ended   Year Ended   Year Ended   Ended 
   August 31, 2021   August 31, 2020   August 31, 2019   August 31, 2018   August 31, 2017* 
                     
Net asset value, beginning of year/period  $10.06   $10.67   $9.68   $9.85   $10.00 
Activity from investment operations:                         
Net investment income (1)(6)(11)   0.17    0.15    0.15    0.16    0.00 (7)
Net realized and unrealized gain (loss) on investments   0.98    (0.61)   1.00    (0.14)   (0.16)
Total from investment operations   1.15    (0.46)   1.15    0.02    (0.16)
Less distributions:                         
From net investment income   (0.16)   (0.15)   (0.16)   (0.19)   (0.00(7)
Total distributions   (0.16)   (0.15)   (0.16)   (0.19)   (0.00)
Paid-in capital from redemption fees (1)               0.00 (7)   0.01 
Net asset value, end of year/period  $11.05   $10.06   $10.67   $9.68   $9.85 
Total return (2)   11.52%   (4.35)%   12.02%   0.25%   (1.47)% (3)
Net assets, end of year/period (000s)  $15,699   $27,098   $18,425   $21,689   $71,063 
Ratio of gross expenses to average net assets including interest and dividend expense (5)(8)(10)   2.62%   2.48%   2.67%   2.26%   2.10(4)
Ratio of net expenses to average net assets including interest and dividend expenses (5)(9)   2.27%   2.25%   2.35%   2.25%   2.10(4)
Ratio of net investment income to average net assets (5)(6)   1.62%   1.47%   1.51%   1.64%   0.02(4)
Portfolio turnover rate   13%   153%   183%   298%   366(3)

 

 
* For the period September 6, 2016 (commencement of operations) through August 31, 2017.
   
(1) Per share amounts calculated using the average shares method, which more appropriately presents the per share data for the period.
   
(2) Total returns are historical in nature and assume changes in share price, and reinvestment of dividends and capital gains distributions, if any.
   
(3) Not annualized.
   
(4) Annualized.
   
(5)

The ratios of expenses to average net assets and net investment income to average net assets do not reflect the expenses of the underlying investment companies in which the Fund invests.

   
(6) Recognition of net investment income by the Fund is affected by the timing and declaration of dividends by the underlying investment companies in which the Fund invests.
   
(7) Amount is less than $0.005.

 

(8) Ratio of gross expenses to average net assets excluding interest expense and dividend expense (5)   2.60%   2.48%   2.57%   2.26%   2.10%
                            
(9) Ratio of net expenses to average net assets excluding interest expense and dividend expense (5)   2.25%   2.25%   2.25%   2.25%   2.10%

 

(10) Represents the ratio of expenses to average net assets absent fee waivers and/or expense reimbursements by the adviser.
   
(11) Does not include the expenses of the underlying investment companies in which the Fund invests.

 

See accompanying notes to financial statements.

28

 

Anchor Risk Managed Municipal Strategies Fund
FINANCIAL HIGHLIGHTS

 

Per Share Data and Ratios for a Share of Beneficial Interest Outstanding Throughout Each Year/Period Presented.

 

   Advisor Class 
   For the   For the Period 
   Year Ended   Ended 
   August 31, 2021   August 31, 2020* 
         
Net asset value, beginning of year/period  $10.06   $10.06 
Activity from investment operations:          
Net investment income (1)(6)(13)   0.21    0.00 (9)
Net realized and unrealized gain on investments   0.87     
Total from investment operations   1.08     
Less distributions:          
From net investment income   (0.10)    
Total distributions   (0.10)    
Net asset value, end of year/period  $11.04   $10.06 
Total return (2)   10.80%   0.00(3)
Net assets, end of year/period (000s)  $1,786   $10 (7)
Ratio of gross expenses to average net assets including interest and dividend expense (5)(8)(11)   2.41%   2.23(4)
Ratio of net expenses to average net assets including interest and dividend expense (5)(12)   2.00%   2.00(4)
Ratio of net investment income to average net assets (5)(6)   1.91%   0.00(4)
Portfolio turnover rate   13%   153(10)

 

 
* For the period July 15, 2020 (commencement of operations) through August 31, 2020.
   
(1) Per share amounts calculated using the average shares method, which more appropriately presents the per share data for the period.
   
(2) Total returns are historical in nature and assume changes in share price, and reinvestment of dividends and capital gains distributions, if any.
   
(3) Not annualized.
   
(4) Annualized.
   
(5) The ratios of expenses to average net assets and net investment income to average net assets do not reflect the expenses of the underlying investment companies in which the Fund invests.
   
(6) Recognition of net investment income by the Fund is affected by the timing and declaration of dividends by the underlying investment companies in which the Fund invests.
   
(7) Amount is actual; not presented in thousands.
   
(8) Represents the ratio of expenses to average net assets absent fee waivers and/or expense reimbursements by the adviser.
   
(9) Amount is less than $0.005.
   
(10) The portfolio turnover rate is for the entire Fund for the year ended August 31, 2020.

 

(11) Ratio of gross expenses to average net assets excluding interest expense and dividend expense (5)   2.41%   2.23%
             
(12) Ratio of net expenses to average net assets excluding interest expense and dividend expense (5)   2.00%   2.00%

 

(13) Does not include the expenses of the underlying investment companies in which the Fund invests.

 

See accompanying notes to financial statements.

29

 

Anchor Funds
NOTES TO FINANCIAL STATEMENTS
August 31, 2021

 

1.ORGANIZATION

 

The Anchor Risk Managed Credit Strategies Fund (“Credit Fund”), Anchor Risk Managed Equity Strategies Fund (“Equity Fund”), Anchor Risk Managed Global Strategies Fund (“Global Fund”) and Anchor Risk Managed Municipal Strategies Fund (“Muni Fund”) (each a “Fund” and collectively, the “Funds”) are diversified series of shares of beneficial interest of Northern Lights Fund Trust IV (the “Trust”), a trust organized under the laws of the State of Delaware on June 2, 2015, and registered under the Investment Company Act of 1940, as amended (the “1940 Act”), as an open-end management investment company. The Credit Fund, Equity Fund and Muni Fund each have the investment objective to seek to provide total return from income and capital appreciation with a secondary objective of limiting risk during unfavorable market conditions. The Global Fund seeks to achieve above average total returns over a full market cycle with lower correlation and reduced risk when compared to traditional world indices. The Credit Fund commenced operations on September 29, 2015. The Equity Fund and Muni Fund commenced operations on September 6, 2016. The Global Fund commenced operations on January 15, 2019.

 

Each Fund offers two share classes designated as Institutional Class and Advisor Class. The Investor Class of the Credit Fund converted to the Institutional Class of the Credit Fund on August 1, 2017. The Investor Class of the Equity Fund, Global Fund and Muni Fund were renamed Advisor Class on April 29, 2020. The Advisor Class of the Equity Fund commenced operations on April 30, 2020. The Advisor Class of the Global Fund and Muni Fund commenced operations on July 15, 2020. The Advisor Class of the Credit Fund commenced operations on September 11, 2020. Each class represents an interest in the same assets of each Fund and classes are identical except for differences in their ongoing service and distribution charges. Fund level income and expenses and realized and unrealized capital gains and losses are allocated to each class of shares based on their relative net assets within the respective Fund. Class specific expenses are allocated to that share class.

 

2.SIGNIFICANT ACCOUNTING POLICIES

 

The following is a summary of significant accounting policies followed by each Fund in preparation of its financial statements. These policies are in conformity with accounting principles generally accepted in the United States of America (“GAAP”). The preparation of financial statements requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of income and expenses for the period. Actual results could differ from those estimates. Each Fund is an investment company and accordingly follows the investment company accounting and reporting guidance of the Financial Accounting Standards Board (“FASB”) Accounting Standards Codification Topic 946 “Financial Services – Investment Companies” including FASB Accounting Standards Update (“ASU”) 2013-08.

 

Security Valuation – Securities listed on an exchange are valued at the last reported sale price at the close of the regular trading session of the exchange on the business day the value is being determined, or in the case of securities listed on NASDAQ, at the NASDAQ Official Closing Price (“NOCP”). In the absence of a sale, such securities shall be valued at the mean between the current bid and ask prices on the day of valuation. Exchange traded futures are valued at the final settle price or, in the absence of a sale price, at the mean between the current bid and ask prices on the day of valuation. Short-term debt obligations having 60 days or less remaining until maturity, at time of purchase, may be valued at amortized cost.

30

 

Anchor Funds
NOTES TO FINANCIAL STATEMENTS (Continued)
August 31, 2021

 

Valuation of Underlying Funds – The Funds may invest in portfolios of open-end or closed-end investment companies (the “Underlying Funds”). Investment companies are valued at their respective net asset values as reported by such investment companies. Open-end investment companies value securities in their portfolios for which market quotations are readily available at their market values (generally the last reported sale price) and all other securities and assets at their fair value to the methods established by the board of directors of the open-end funds. The shares of many closed-end investment companies and exchange traded funds (“ETFs”), after their initial public offering, frequently trade at a price per share, which is different than the net asset value per share. The difference represents a market premium or market discount of such shares. There can be no assurances that the market discount or market premium on shares of any closed-end investment company or ETF purchased by the Funds will not change.

 

The Funds may hold securities, such as private investments, interests in commodity pools, other non-traded securities or temporarily illiquid securities, for which market quotations are not readily available or are determined to be unreliable. These securities will be valued using the “fair value” procedures approved by the Trust’s Board of Trustees (the “Board”). The Board has delegated execution of these procedures to a fair value committee composed of one or more representatives from each of the (i) Trust, (ii) administrator, and (iii) adviser. The committee may also enlist third party consultants such as a valuation specialist at a public accounting firm, valuation consultant, or financial officer of a security issuer on an as-needed basis to assist in determining a security-specific fair value. The Board reviews and ratifies the execution of this process and the resultant fair value prices at least quarterly to assure the process produces reliable results.

 

Fair Valuation Process. As noted above, the fair value committee is composed of one or more representatives from each of the (i) Trust, (ii) administrator, and (iii) adviser. The applicable investments are valued collectively via inputs from each of these groups. For example, fair value determinations are required for the following securities: (i) securities for which market quotations are insufficient or not readily available on a particular business day (including securities for which there is a short and temporary lapse in the provision of a price by the regular pricing source); (ii) securities for which, in the judgment of the adviser, the prices or values available do not represent the fair value of the instrument. Factors which may cause the adviser to make such a judgment include, but are not limited to, the following: only a bid price or an asked price is available; the spread between bid and asked prices is substantial; the frequency of sales; the thinness of the market; the size of reported trades; and actions of the securities markets, such as the suspension or limitation of trading; (iii) securities determined to be illiquid; and (iv) securities with respect to which an event that will affect the value thereof has occurred (a “significant event”) since the closing prices were established on the principal exchange on which they are traded, but prior to a Fund’s calculation of its net asset value. Restricted or illiquid securities, such as private investments or non-traded securities are valued via inputs from the adviser based upon the current bid for the security from two or more independent dealers or other parties reasonably familiar with the facts and circumstances of the security (who should take into consideration all relevant factors as may be appropriate under the circumstances). If the adviser is unable to obtain a current bid from such independent dealers or other independent parties, the fair value committee shall determine the fair value of such security using the following factors: (i) the type of security; (ii) the cost at date of purchase; (iii) the size and nature of a Fund’s holdings; (iv) the discount from market value of unrestricted securities of the same class at the time of purchase and subsequent thereto; (v) information as to any transactions or offers with respect to the security; (vi) the nature and duration of restrictions on disposition of the security and the existence of any registration rights; (vii) how

31

 

Anchor Funds

NOTES TO FINANCIAL STATEMENTS (Continued)

August 31, 2021

 

the yield of the security compares to similar securities of companies of similar or equal creditworthiness; (viii) the level of recent trades of similar or comparable securities; (ix) the liquidity characteristics of the security; (x) current market conditions; and (xi) the market value of any securities into which the security is convertible or exchangeable.

 

The Funds utilize various methods to measure the fair value of their investments on a recurring basis. GAAP establishes a hierarchy that prioritizes inputs to valuation methods. The three levels of input are:

 

Level 1 – Unadjusted quoted prices in active markets for identical assets and liabilities that the Funds have the ability to access.

 

Level 2 – Observable inputs other than quoted prices included in Level 1 that are observable for the asset or liability, either directly or indirectly. These inputs may include quoted prices for the identical instrument in an inactive market, prices for similar instruments, interest rates, prepayment speeds, credit risk, yield curves, default rates and similar data.

 

Level 3 – Unobservable inputs for the asset or liability, to the extent relevant observable inputs are not available, representing the Funds’ own assumptions about the assumptions a market participant would use in valuing the asset or liability, and would be based on the best information available.

 

The availability of observable inputs can vary from security to security and is affected by a wide variety of factors, including, for example, the type of security, whether the security is new and not yet established in the marketplace, the liquidity of markets, and other characteristics particular to the security. To the extent that valuation is based on models or inputs that are less observable or unobservable in the market, the determination of fair value requires more judgment. Accordingly, the degree of judgment exercised in determining fair value is greatest for instruments categorized in Level 3.

 

The inputs used to measure fair value may fall into different levels of the fair value hierarchy. In such cases, for disclosure purposes, the level in the fair value hierarchy within which the fair value measurement falls in its entirety, is determined based on the lowest level input that is significant to the fair value measurement in its entirety.

 

The inputs or methodology used for valuing securities are not necessarily an indication of the risk associated with investing in those securities. The following table summarizes the inputs used as of August 31, 2021 for the Funds’ assets and liabilities measured at fair value:

 

Credit Fund                
                 
Assets  Level 1   Level 2   Level 3   Total 
Investments                    
Exchange-Traded Funds *  $38,298,900   $   $   $38,298,900 
Money Market Fund   4,612,609            4,612,609 
Total Investments  $42,911,509   $   $   $42,911,509 
Derivatives                    
Futures Contracts **  $93,717   $   $   $93,717 

32

 

Anchor Funds
NOTES TO FINANCIAL STATEMENTS (Continued)
August 31, 2021

 

Equity Fund                
                 
Assets  Level 1   Level 2   Level 3   Total 
Investments                    
Exchange-Traded Funds *  $194,010,911   $   $   $194,010,911 
Money Market Fund   104,189,606            104,189,606 
Total Investments  $298,200,517   $   $   $298,200,517 
Derivatives                    
Futures Contracts **  $2,702,785   $   $   $2,702,785 
                     
Global Fund                
                 
Assets  Level 1   Level 2   Level 3   Total 
Investments                    
Money Market Fund  $27,567,630   $   $   $27,567,630 
Total Investments  $27,567,630   $   $   $27,567,630 
Derivatives                    
Futures Contracts**  $885,888   $   $   $885,888 
                     
Municipal Fund                
                 
Assets  Level 1   Level 2   Level 3   Total 
Investments                    
Closed-End Funds *  $18,674,935   $   $   $18,674,935 
Money Market Fund   368,454            368,454 
Total Investments  $19,043,389   $   $   $19,043,389 

 

The Funds did not hold any Level 3 securities during the period.

 

*Please refer to the Schedule of Investments for breakout by type.

 

**Represents cumulative appreciation (depreciation) on futures contracts at August 31, 2021.

 

Exchange Traded Funds – The Funds may invest in ETFs. ETFs are a type of fund bought and sold on a securities exchange. An ETF trades like common stock and represents a portfolio of securities. The Funds may purchase an ETF to gain exposure to a portion of the U.S. or a foreign market. The risks of owning an ETF generally reflect the risks of owning its underlying securities, although the lack of liquidity on an ETF could result in it being more volatile. Additionally, ETFs have fees and expenses that reduce their value.

 

Short Sales – A “short sale” is a transaction in which a Fund sells a security it does not own but have borrowed in anticipation that the market price of that security will decline. A Fund is obligated to replace the security borrowed by purchasing it on the open market at a later date. If the price of the security sold short increases between the time of the short sale and the time the Fund replaces the borrowed security, the Fund will incur a loss, potentially unlimited in size. Conversely, if the price declines, the Fund will realize a gain, limited to the price at which the Fund sold the security short. As of August 31, 2021, the Funds had no open short positions.

 

Futures – The Funds are subject to equity price risk in the normal course of pursuing their investment objectives. To manage equity price risk, the Funds may enter into futures contracts. Upon entering into a futures contract with a broker, a Fund is required to deposit, in a segregated account, a specified amount of cash which is classified as “cash deposit” with broker in the accompanying Statements of Assets and Liabilities. Futures contracts are valued daily and unrealized gains or losses are recorded in the “net unrealized appreciation from future contracts” account. Periodically, a Fund may receive from, or pay to the brokers, a specified amount of cash based upon changes in the “net unrealized appreciation from open future contracts” account. When a contract is closed, the Fund recognizes a realized gain or loss. Futures contracts have market risks, including the risk that the change in the value of the

33

 

Anchor Funds
NOTES TO FINANCIAL STATEMENTS (Continued)
August 31, 2021

 

contract may not correlate with changes in the value of the underlying securities. With futures contracts, there is minimal counterparty credit risk to the Funds since futures are exchange traded and the exchange’s clearinghouse, as counterparty to all exchange traded futures, guarantees the futures against default. Futures contracts outstanding at year end are listed after each Fund’s Schedule of Investments.

 

The notional value represents amounts related to each Fund’s futures contracts upon which the fair value of the futures contracts held by the Fund is based. Notional values do not represent the current fair value of the Funds’ futures contracts. Further, the underlying price changes in relation to variables specified by the notional values, affects the fair value of these derivative financial instruments. Theoretically, each Fund’s exposure is equal to the notional value of contracts held. Each Fund’s obligations will generally equal only the amount to be paid or received through a futures contract.

 

The notional value of the derivative instruments outstanding as of August 31, 2021 as disclosed in each Fund’s Schedule of Investments and the amounts realized and changes in unrealized gains and losses on derivative instruments during the period as disclosed above and within the Statements of Operations serve as indicators of the volume of derivative activity.

 

For the year ended August 31, 2021, the amount of unrealized appreciation (depreciation) and realized gain (loss) on futures contracts subject to equity price risk amounted to the following:

 

   Statements of       Statements of     
   Assets   Statements of   Operations     
   Unrealized   Liabilities   Net Change in   Statements of 
   Appreciation   Unrealized   Unrealized   Operations Realized 
   for Futures   (Depreciation) for   Appreciation on   Gain from Futures 
Fund  Contracts *   Futures Contracts *   Futures Contracts #   Contracts # 
Credit Fund  $93,717   $   $93,717   $1,178,655 
Equity Fund   2,702,785        3,008,997    4,990,911 
Global Fund   885,888        951,776    3,099,450 
Muni Fund                

 

#Such figures can be found on the Statements of Operations.

 

*Cumulative unrealized gain (loss) on futures contracts.

 

Security Transactions and Related Income – Security transactions are accounted for on the trade date. Interest income is recognized on an accrual basis. Discounts are accreted and premiums are amortized on securities purchased over the lives of the respective securities. Dividend income and expenses are recorded on the ex-dividend date. Realized gains or losses from sales of securities are determined by comparing the identified cost of the security lot sold with the net sales proceeds. Withholding taxes on foreign dividends have been provided for in accordance with the Funds’ understanding of the applicable country’s tax rules and rates.

 

Dividends and Distributions to Shareholders – Dividends from net investment income, if any, are declared quarterly by the Credit Fund, Equity Fund and Global Fund; and monthly by the Muni Fund. Distributable net realized capital gains, if any, are declared and distributed annually. Dividends from net investment income and distributions from net realized gains are determined in accordance with federal income tax regulations, which may differ from GAAP. These “book/tax” differences are considered either temporary (e.g., deferred losses, capital loss carryforwards, etc.) or permanent in nature. To the extent these differences are permanent in nature, such amounts are reclassified within the composition of net assets based on their federal tax-basis treatment; temporary differences do not require reclassification. Any such

34

 

Anchor Funds
NOTES TO FINANCIAL STATEMENTS (Continued)
August 31, 2021

 

reclassifications will have no effect on net assets, results of operations, or net asset values per share of the Funds.

 

Federal Income Tax – It is each Fund’s policy to qualify as a regulated investment company by complying with the provisions of the Internal Revenue Code that are applicable to regulated investment companies and to distribute substantially all of their taxable income and net realized gains to shareholders. Therefore, no federal income tax provision is required. The Funds recognize the tax benefits of uncertain tax positions only where the position is “more likely than not” to be sustained assuming examination by tax authorities. Management has analyzed the Funds’ tax positions and has concluded that no liability for unrecognized tax benefits should be recorded related to uncertain tax positions taken on returns filed for open tax years ended August 31, 2018 to August 31, 2020 or expected to be taken in the Funds’ August 31, 2021 year-end tax returns. The Funds identify their major tax jurisdictions as U.S. federal, state of Ohio, and foreign jurisdictions where the Funds make significant investments; however, the Funds are not aware of any tax positions for which it is reasonably possible that the total amounts of unrecognized tax benefits will change materially in the next twelve months.

 

Expenses – Expenses of the Trust that are directly identifiable to a specific Fund are charged to that Fund. Expenses, which are not readily identifiable to a specific Fund, are allocated in such a manner as deemed equitable, taking into consideration the nature and type of expense and the relative sizes of the Funds in the Trust.

 

Indemnification – The Trust indemnifies its officers and trustees for certain liabilities that may arise from the performance of their duties to the Trust. Additionally, in the normal course of business, the Funds enter into contracts that contain a variety of representations and warranties and which provide general indemnities. The Funds’ maximum exposure under these arrangements is unknown, as this would involve future claims that may be made against the Funds that have not yet occurred. However, based on experience, the risk of loss due to these warranties and indemnities appears to be remote.

 

3.CASH – CONCENTRATION IN UNINSURED ACCOUNT

 

For cash management purposes, the Funds may concentrate cash with the Funds’ custodian and broker. As of August 31, 2021, the Credit Fund and Global Fund held $1,579,060 and $4,040,190, respectively, in cash at U.S. Bank, N.A. for Jefferies. The Credit Fund, Equity Fund, Global Fund and Muni Fund held $4,229,202, $38,687,556, $5,105,782 and $300,000 at Interactive Brokers.

 

4.INVESTMENT TRANSACTIONS

 

For the year ended August 31, 2021, cost of purchases and proceeds from sales of portfolio securities, other than short-term investments, amounted to $264,797,070 and $ 264,667,903 respectively, for the Credit Fund; $0 and $0 respectively, for the Equity Fund; $9,181,870 and $25,887,160, respectively, for the Global Fund and $2,988,620 and $10,059,407, respectively, for the Muni Fund.

 

5.INVESTMENT ADVISORY AGREEMENT AND TRANSACTIONS WITH RELATED PARTIES

 

Anchor Capital Management Group, Inc. serves as the Funds’ investment adviser (the “Adviser”).

35

 

Anchor Funds
NOTES TO FINANCIAL STATEMENTS (Continued)
August 31, 2021

 

Pursuant to an investment advisory agreement with the Trust, on behalf of each Fund, the Adviser, under the oversight of the Board, oversees the daily operations of the Funds and supervises the performance of administrative and professional services provided by others. As compensation for its services and the related expenses borne by the Adviser, each Fund pays the Adviser a management fee, computed and accrued daily and paid monthly, at an annual rate of 1.60% of each Fund’s average daily net assets. For the year ended August 31, 2021, the Funds incurred advisory fees of $734,963 for the Credit Fund; $4,583,551 for the Equity Fund; $489,548 for the Global Fund and $383,922 for the Muni Fund.

 

The Adviser has contractually agreed to reduce its fees and/or absorb expenses of each Fund until at least December 31, 2021 to ensure that total annual fund operating expenses after fee waiver and/or reimbursement (exclusive of any front-end or contingent deferred loads, taxes, brokerage fees and commissions, borrowing costs (such as interest and dividend expense on securities sold short), acquired fund fees and expenses, fees and expenses associated with investments in other collective investment vehicles or derivative instruments (including for example option and swap fees and expenses), or extraordinary expenses such as litigation) will not exceed 2.25% of the average daily net assets of each Fund’s Institutional Class shares and 2.00% of the average daily net assets of each Fund’s Advisor Class shares. Fees waived or reimbursed by the Adviser may be recouped by the Adviser from the Fund, to the extent that overall expenses fall below the expense limitation within three years following when such amounts were waived and/or reimbursed if such recoupment can be achieved within the lesser of the foregoing expense limits or the expenses limits in place at the time of the recoupment. During the year ended August 31, 2021, the Adviser waived fees of $27,523 for Credit Fund, $63,822 for the Global Fund and $84,334 for Muni Fund, which are subject to recapture by the Adviser. As of August 31, 2021, the Adviser has waived fees that can be recouped up to three years from the date incurred as summarized below:

 

   Expires August   Expires August   Expires August 31, 
   31, 2022   31, 2023   2024 
Credit Fund  $52,828   $40,107   $27,523 
Global Fund   76,235    101,864    63,822 
Muni Fund   69,495    57,485    84,334 

 

Distributor – The distributor of the Funds is Northern Lights Distributors, LLC (the “Distributor”), The Board has adopted, on behalf of the Funds, the Trust’s Master Distribution and Shareholder Servicing Plan (the “Plan”), as amended, pursuant to Rule 12b-1 under the 1940 Act. Under the Plan, Institutional Class Shares may pay up to 0.25% of their average daily net assets to pay for certain distribution activities and shareholder services. No distribution fees are paid on the Advisor Class Shares. For the year ended August 31, 2021, $109,717, $528,431, $71,453, and $57,292 was incurred under the Plan for the Credit Fund, the Equity Fund, the Global Fund, and the Muni Fund, respectively.

 

The Distributor acts as the Funds’ principal underwriter in a continuous public offering of the Funds’ shares. For the year ended August 31, 2021 the Distributor did not receive any underwriting commissions for sales of the Funds’ shares.

 

In addition, certain affiliates of the Distributor provide services to the Funds as follows:

 

Gemini Fund Services, LLC (“GFS”), an affiliate of the Distributor, provides administration, fund accounting, and transfer agent services to the Trust. Pursuant to separate servicing agreements with GFS, each Fund pays GFS customary fees for providing administration, fund

36

 

Anchor Funds
NOTES TO FINANCIAL STATEMENTS (Continued)
August 31, 2021

 

accounting and transfer agency services to the Fund. Certain officers of the Trust are also officers of GFS, and are not paid any fees directly by the Funds for serving in such capacities.

 

Northern Lights Compliance Services, LLC (“NLCS”), an affiliate of GFS and the Distributor, provides a Chief Compliance Officer to the Trust, as well as related compliance services, pursuant to a consulting agreement between NLCS and the Trust. Under the terms of such agreement, NLCS receives customary fees from the Funds.

 

Blu Giant, LLC (“Blu Giant”), an affiliate of GFS and the Distributor, provides EDGAR conversion and filing services as well as print management services for the Funds on an ad-hoc basis. For the provision of these services, Blu Giant receives customary fees from the Funds.

 

6.AGGREGATE UNREALIZED APPRECIATION AND DEPRECIATION – TAX BASIS

 

The identified cost of investments in securities owned by the Funds for federal income tax purposes and the respective gross unrealized appreciation and depreciation at August 31, 2021 were as follows:

 

       Gross   Gross   Net Unrealized 
   Tax   Unrealized   Unrealized   Appreciation/ 
   Cost   Appreciation   Depreciation   (Depreciation) 
Credit Fund  $42,761,872   $215,550   $(65,913)  $149,637 
Equity Fund   213,836,823    89,494,450    (5,130,756)  $84,363,694 
Global Fund   27,567,630           $ 
Muni Fund   16,793,445    2,249,944       $2,249,944 

 

7.DISTRIBUTIONS TO SHAREHOLDERS AND TAX COMPONENTS OF CAPITAL

 

The tax character of distributions paid during the fiscal years ended August 31, 2021 and August 31, 2020 was as follows:

 

For the year ended August 31, 2021:            
             
   Ordinary   Long-Term   Exempt   Return of     
   Income   Capital Gains   Income   Capital   Total 
Credit Fund  $701,309   $2,213   $   $   $703,522 
Equity Fund                    
Global Fund   348,367    688,691            1,037,058 
Muni Fund   6,345        368,124        374,469 

 

For the year ended August 31, 2020:            
             
   Ordinary   Long-Term   Exempt   Return of     
   Income   Capital Gains   Income   Capital   Total 
Credit Fund  $545,344   $   $   $16,249   $561,593 
Equity Fund   13,921,177    1,027,209            14,948,386 
Global Fund   942,628                942,628 
Muni Fund   15,217        333,842        349,059 

37

 

Anchor Funds
NOTES TO FINANCIAL STATEMENTS (Continued)
August 31, 2021

 

As of August 31, 2021, the components of accumulated earnings/ (deficit) on a tax basis were as follows:

 

   Undistributed   Undistributed   Undistributed   Post October Loss   Capital Loss   Other   Unrealized   Total 
   Ordinary   Ordinary   Long-Term   and   Carry   Book/Tax   Appreciation   Accumulated 
   Tax-Exempt Income   Income   Capital Gains   Late Year Loss   Forwards   Differences   (Depreciation)   Earnings/(Deficits) 
Credit Fund  $   $244,628   $955,050   $   $   $(1,503)  $149,637   $1,347,812 
Equity Fund               (3,532,557)           84,363,694    80,831,137 
Global Fund       634,284    3,747,364                    4,381,648 
Muni Fund   50,467                (2,970,090)       2,249,944    (669,679)

 

The difference between book basis and tax basis accumulated net investment income (loss), accumulated net realized gain(loss), and unrealized appreciation/(depreciation) from investments is primarily attributable to the tax deferral of losses on wash sales and the mark-to-market on open futures contracts. In addition, the amount listed under other book/tax differences are primarily attributable to the tax deferral of losses on the unamortized portion of organization expenses for tax purposes.

 

Tax equalization allows a Fund to treat as distribution that portion of redemption proceeds representing a redeeming shareholder’s portion of undistributed taxable and net capital gains. The table below shows equalization amounts which resulted in a difference between tax distributions and book distributions as disclosed on the Statement of Changes for the year ended August 31, 2021. Net investment income and net realized gains(losses), as disclosed on the Statements of Operations and net assets were not affected by these reclassifications.

 

   Equalization 
Portfolio  Utilized 
Credit Fund  $2,213 
Equity Fund    
Global Fund   688,691 
Muni Fund    

 

Late year losses incurred after December 31 within the fiscal year are deemed to arise on the first business day of the following fiscal year for tax purposes. The Funds incurred and elected to defer such late year losses as follows:

 

   Late Year 
   Losses 
Credit Fund  $ 
Equity Fund   3,532,557 
Global Fund    
Muni Fund    

 

On August 31, 2021, the Funds had capital loss carry forwards for federal income tax purposes available to offset future capital gains along with capital loss carryforwards utilized as follows:

 

               Carry Forward 
   Short-Term   Long-Term   Total   Utilized 
Credit Fund  $   $   $   $ 
Equity Fund                
Global Fund                
Muni Fund   2,970,090        2,970,090    426,808 

38

 

Anchor Funds
NOTES TO FINANCIAL STATEMENTS (Continued)
August 31, 2021

 

Permanent book and tax differences, primarily attributable to the book/tax basis treatment of net operating losses and equalization debits, resulted in reclassifications for the Funds for the year ended August 31, 2021 as follows:

 

   Paid     
   In   Accumulated 
   Capital   Earnings (Losses) 
Credit Fund  $2,213   $(2,213)
Equity Fund   (595,830)   595,830 
Global Fund   688,691    (688,691)
Muni Fund        

 

8.LINE OF CREDIT

 

The Funds may borrow to meet repurchase requests. The Funds are required to maintain asset coverage (that is, total assets including borrowings, less liabilities exclusive of borrowings) of at least 300% of the amount borrowed. The Funds had entered into a line of credit (“LOC”) agreement with MUFG Union Bank, N.A. (“MUFG”), which permits the Funds to borrow at a rate, per annum, equal to 3.25%. The Funds did not borrow from MUFG in the period September 1, 2020 to August 2, 2021. On August 2, 2021, the LOC was assigned to U.S. Bank as a result of its acquisition of MUFG but only for the Credit Fund and Muni Fund and at a rate, per annum, equal to the prime rate. During the year ended August 31, 2021, the Muni Fund incurred $285 of interest expense which is included in margin interest expense on the Statements of Operations. Average borrowings and the average interest rate for the days the LOC was outstanding during the year ended August 31, 2021 were $630,400 and 3.25%, respectively. The largest amount outstanding during the year ended August 31, 2021 was $1,566,000. The Credit Fund did not utilize this joint uncommitted facility of $5,000,000 during the year ended August 31, 2021. The LOC expires on August 1, 2022.

 

9.UNDERLYING INVESTMENT IN OTHER INVESTMENT COMPANIES

 

The Funds listed below currently invest a portion of their assets in the corresponding investment companies. Each Fund may redeem its investment from the investment companies at any time if the Adviser determines that it is in the best interest of the Fund and its shareholders to do so. The performance of the Funds will be directly affected by the performance of these investment companies. The financial statements of these investment companies, including their portfolios of investments, can be found at the Securities and Exchange Commission’s website www.sec.gov and should be read in conjunction with the Funds’ financial statements.

 

      Percentage of Net
Fund  Investment  Assets
Credit Fund  iShares iBoxx High Yield Corporate Bond ETF  39.0%
   SPDR Bloomberg Barclays High Yield Bond ETF  41.7%
Equity Fund  Invesco QQQ Trust Series 1  46.4%
   First American Government Obligations Fund, Class X  32.5%
Global Fund  First American Government Obligations Fund, Class X  73.1%

 

Each underlying fund, including each ETF, is subject to specific risks, depending on the nature of the underlying fund. These risks could include liquidity risk, sector risk, foreign and related currency risk. Investors in the Funds will indirectly bear fees and expenses charged by the underlying investment companies in which the Funds invests in addition to the Funds’ direct fees and expenses.

39

 

Anchor Funds
NOTES TO FINANCIAL STATEMENTS (Continued)
August 31, 2021

 

10.CONTROL OWNERSHIP

 

The beneficial ownership, either directly or indirectly, of more than 25% of the voting securities of a fund creates presumption of control of the fund, under Section 2(a)(9) of the 1940 Act. As of August 31, 2021, TD Ameritrade Inc., an account holding shares for the benefit of others in nominee name, held approximately 79%, 48%, 76% and 79% of the voting securities for the Credit Fund, the Equity Fund, the Global Fund and the Muni Fund, respectively. The Funds have no knowledge as to whether any beneficial owner included in these nominee accounts holds more than 25% of the voting shares of any Fund.

 

11.SUBSEQUENT EVENTS

 

Subsequent events occurring after the date of the Statements of Assets and Liabilities have been evaluated through the date the financial statements were issued. Management has determined that no events or transactions occurred requiring adjustment or disclosure in the financial statements.

40

 

(BBD LOGO)

 

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

 

To the Board of Trustees of Northern Lights Fund Trust IV

and the Shareholders of Anchor Risk Managed Credit Strategies Fund,

Anchor Risk Managed Equity Strategies Fund, Anchor Risk Managed Global Strategies Fund,

and Anchor Risk Managed Municipal Strategies Fund

 

Opinion on the Financial Statements

 

We have audited the accompanying statements of assets and liabilities of Anchor Risk Managed Credit Strategies Fund, Anchor Risk Managed Equity Strategies Fund, Anchor Risk Managed Global Strategies Fund, and Anchor Risk Managed Municipal Strategies Fund, each a series of shares of beneficial interest in Northern Lights Fund Trust IV (the “Funds”), including the portfolios of investments, as of August 31, 2021, and the related statements of operations for the year then ended, the statements of changes in net assets for each of the years in the two-year period then ended, the financial highlights as noted in the table below, and the related notes (collectively referred to as the “financial statements”). In our opinion, the financial statements present fairly, in all material respects, the financial position of the Funds as of August 31, 2021, and the results of their operations for the year then ended, the changes in their net assets for each of the years in the two-year period then ended and their financial highlights for each of the periods noted in the table below, in conformity with accounting principles generally accepted in the United States of America.

 

Fund Financial Highlights Presented
Anchor Risk Managed Credit Strategies Fund

Institutional Class financial highlights for each of the years in the five-year period ended August 31, 2021

 

Advisor Class financial highlights for the period September 11, 2020 (commencement of operations) through August 31, 2021

Anchor Risk Managed Equity Strategies Fund

Institutional Class financial highlights for each of the years in the four-year period ended August 31, 2021 and for the period from September 6, 2016 (commencement of operations) through August 31, 2017

 

Advisor Class financial highlights for the year ended August 31, 2021 and for the period from April 30, 2020 (commencement of operations) through August 31, 2020

Anchor Risk Managed Global Strategies Fund

Institutional Class financial highlights for each of the years in the two-year period ended August 31, 2021 and for the period from January 15, 2019 (commencement of operations) through August 31, 2019

 

Advisor Class financial highlights for the year ended August 31, 2021 and for the period from July 15, 2020 (commencement of operations) through August 31, 2020

Anchor Risk Managed Municipal Strategies Fund

Institutional Class financial highlights for each of the years in the four-year period ended August 31, 2021 and for the period from September 6, 2016 (commencement of operations) through August 31, 2017

 

Advisor Class financial highlights for the year ended August 31, 2021 and for period from July 15, 2020 (commencement of operations) through August 31, 2020

41

 

Basis for Opinion

 

These financial statements are the responsibility of the Funds’ management. Our responsibility is to express an opinion on the Funds’ financial statements based on our audits. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (“PCAOB”) and are required to be independent with respect to the Funds in accordance with the U.S. federal securities law and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.

 

We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audits to obtain reasonable assurance about whether the financial statements are free of material misstatement, whether due to error or fraud. The Funds are not required to have, nor were we engaged to perform, an audit of their internal control over financial reporting. As part of our audits we are required to obtain an understanding of internal control over financial reporting but not for the purpose of expressing an opinion on the effectiveness of the Funds’ internal control over financial reporting. Accordingly, we express no such opinion.

 

Our audits included performing procedures to assess the risk of material misstatement of the financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements. Our procedures included confirmation of securities owned as of August 31, 2021 by correspondence with the custodian, brokers, or by other appropriate auditing procedures where replies from brokers were not received. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial statements. We believe that our audits provide a reasonable basis for our opinion.

 

(-s- BBD, LLP)

 

BBD, LLP

 

We have served as the auditor of one or more of the Funds in the Northern Lights Fund Trust IV since 2015.

 

Philadelphia, Pennsylvania

October 26, 2021

42

 

Anchor Funds
SUPPLEMENTAL INFORMATION (Unaudited)
August 31, 2021
 

The business address of each Trustee and Officer is 225 Pictoria Drive, Suite 450, Cincinnati, OH 45246. All correspondence to the Trustees and Officers should be directed to c/o Gemini Fund Services, LLC, P.O. Box 541150, Omaha, Nebraska 68154.

 

Independent Trustees

 

Name and Year
of Birth
Position/Term
of Office *
Principal Occupation During the Past
Five Years
Number of
Funds in
Fund

Complex**
Overseen by
Trustee
Other Directorships held
by Trustee During the Past
Five Years
Joseph Breslin
Year of Birth: 1953
Independent Trustee and Chairman of the Board since 2015 President and Consultant, Adviser Counsel, Inc. (formerly J.E. Breslin & Co.) (management consulting firm to investment advisers), (since 2009); Senior Counsel, White Oak Global Advisors, LLC. (since 2016). 4 Northern Lights Fund Trust IV (for series not affiliated with the Fund since 2015); Director, Kinetics Mutual Funds, Inc. (since 2000); Trustee, Kinetics Portfolios Trust (since 2000); Trustee, Forethought Variable Insurance Trust (since 2013); Trustee, BlueArc Multi- Strategy Fund (2014-2017); Hatteras Trust (2004-2016)
Thomas Sarkany
Year of Birth: 1946
Independent Trustee since 2015 Founder and President, TTS Consultants, LLC (financial services) (since 2010). 4 Northern Lights Fund Trust IV (for series not affiliated with the Fund since 2015); Arrow Investments Trust (since 2014), Arrow ETF Trust (since 2012), Trustee, Northern Lights Fund Trust II (since 2011); Director, Aquila Distributors (since 1981)
Charles Ranson
Year of Birth: 1947
Independent Trustee since 2015 Principal, Ranson & Associates (strategic analysis and planning, including risk assessment and capital formation for entrepreneurial ventures) (since 2003). 4 Northern Lights Fund Trust IV (for series not affiliated with the Fund since 2015); Advisors Preferred Trust (since November 2012)

 

8/31/21 - NLFT IV_v1

43

 

Anchor Funds
SUPPLEMENTAL INFORMATION (Unaudited) (Continued)
August 31, 2021

 

Officers

 

Name and Year of
Birth
Position/Term
of Office *
Principal Occupation During the Past
Five Years
Number of
Funds in Fund
Complex**
Overseen by
Trustee
Other Directorships held by
Trustee During the Past
Five Years
Wendy Wang
Year of Birth: 1970
President since 2015 Senior Vice President, Director of Tax and Compliance Administration, Gemini Fund Services, LLC (since 2012). N/A N/A
Sam Singh
Year of Birth: 1976
Treasurer since 2015 Vice President, Gemini Fund Services, LLC (since 2015); Assistant Vice President, Gemini Fund Services, LLC (2011-2014). N/A N/A
Jennifer Farrell
Year of Birth: 1969
Secretary since 2017 Manager, Legal Administration, Gemini Fund Services, LLC (since 2018); Senior Paralegal, Gemini Fund Services, LLC (since 2015); Legal Trainer, Gemini Fund Services, LLC (2013-2015); Senior Paralegal, Gemini Fund Services, LLC (2006-2012). N/A N/A
James Ash
Year of Birth: 1976
Chief Compliance Officer since 2019 Senior Compliance Officer, Northern Lights Compliance, LLC (since 2019); Senior Vice President, National Sales Gemini Fund Services, LLC (2017-2019); Senior Vice President and Director of Legal Administration, Gemini Fund Services, LLC (2012 - 2017). N/A N/A

 

*The term of office for each Trustee and officer listed above will continue indefinitely until the individual resigns or is removed.

 

**As of August 31, 2021, the Trust was comprised of 23 other active portfolios managed by unaffiliated investment advisers. The term “Fund Complex” applies only to the Funds. The Funds do not hold themselves out as related to any other series within the Trust for investment purposes, nor do they share the same investment adviser with any other series.

 

The Funds’ SAI includes additional information about the Trustees and is available free of charge, upon request, by calling toll-free at 1-844-594-1226.

 

8/31/21 - NLFT IV_v1

44

 

Anchor Funds
EXPENSE EXAMPLES (Unaudited)
August 31, 2021
 

As a shareholder of the Funds you incur ongoing costs, including management fees; distribution and/or service (12b-1) fees and other Fund expenses. This example is intended to help you understand your ongoing costs (in dollars) of investing in the Funds and to compare these costs with the ongoing costs of investing in other mutual funds.

 

The example is based on an investment of $1,000 invested at the beginning of the period and held for the entire period as disclosed in the table below.

 

Actual Expenses

 

The “Actual” lines in the table below provide information about actual account values and actual expenses. You may use the information below, together with the amount you invested, to estimate the expenses that you paid over the period. Simply divide your account value by $1,000 (for example, an $8,600 account value divided by $1,000 = 8.6), then multiply the result by the number in the table under the heading entitled “Expenses Paid During Period” to estimate the expenses you paid on your account during this period.

 

Hypothetical Example for Comparison Purposes

 

The “Hypothetical” lines in the table below provide information about hypothetical account values and hypothetical expenses based on the Funds’ actual expense ratios and an assumed rate of return of 5% per year before expenses, which is not the Funds’ actual return. The hypothetical account values and expenses may not be used to estimate the actual ending account balances or expenses you paid for the period. You may use this information to compare this 5% hypothetical example with the 5% hypothetical examples that appear in the shareholder reports of other funds.

 

Please note that the expenses shown in the table are meant to highlight your ongoing costs only and do not reflect any transactional costs, such as contingent deferred sales charges (loads), or redemption fees. Therefore, the table is useful in comparing ongoing costs only, and will not help you determine the relative total costs of owning different funds. In addition, if these transactional costs were included, your costs would have been higher.

 

  Beginning
Account
Value
3/1/21
Ending
Account
Value
8/31/21
Annualized
Expense
Ratio
Expenses* Paid
During Period
3/1/21 – 8/31/21
Actual        
Anchor Risk Managed Credit Strategies Fund-Advisor Class $1,000.00 $1,035.40 2.41% $12.37
Anchor Risk Managed Credit Strategies Fund-Institutional Class $1,000.00 $1,034.50 2.65% $13.59
Anchor Risk Managed Equity Strategies Fund-Advisor Class $1,000.00 $1,149.70 1.88% $10.21
Anchor Risk Managed Equity Strategies Fund-Institutional Class $1,000.00 $1,147.70 2.10% $11.39
Anchor Risk Managed Global Strategies Fund-Advisor Class $1,000.00 $1,121.60 2.02% $10.79
Anchor Risk Managed Global Strategies Fund-Institutional Class $1,000.00 $1,120.80 2.25% $12,03
Anchor Risk Managed Municipal Strategies Fund-Advisor Class $1,000.00 $1,082.30 2.01% $10.56
Anchor Risk Managed Municipal Strategies Fund-Institutional Class $1,000.00 $1,083.80 2.26% $11.89

45

 

Anchor Funds
EXPENSE EXAMPLES (Unaudited) (Continued)
August 31, 2021

 

  Beginning
Account
Value
3/1/21
Ending
Account
Value
8/31/21
Annualized
Expense
Ratio
Expenses* Paid
During Period
3/1/21 – 8/31/21
Hypothetical
(5% return before expenses)
       
Anchor Risk Managed Credit Strategies Fund-Advisor Class $1,000.00 $1,013.05 2.41%