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Salient Tactical Muni & Credit Fund

Daily NAV

Updated: 8/18/17

Symbol
FLSIX
NAV
$7.79
Change
$0.01
Inception Date
May 1, 2008
Net Assets (All Classes)
$71.9 M
Overview

Overview

The fund seeks to maximize total rate of return and minimize investment risk through flexible active management using a credit-based, relative value investment strategy. The fund employs an absolute return-oriented and tax-efficient strategy that seeks to identify attractive long and short investment opportunities in the municipal and other credit markets.

Three Things to Know

  • Portfolio exposures selected with a positive absolute return and downside risk-mitigation objective rather than a traditional index-oriented framework
  • The strategy’s broad discretion allows the team to use its best municipal ideas unbounded by typical fixed-income benchmark constraints
  • Internal credit analysts rate every credit held in the portfolio prior to purchase and on an ongoing basis, never relying on credit agencies ratings alone

Process

Objective: The fund seeks to maximize total return (capital appreciation and income).

  • PIMCO’s extensive macroeconomic and fixed-income research drives the portfolio’s long-term market view
  • After major top-down strategies have been determined, individual securities are selected through bottom-up processes seeking to achieve attractive yields and targeted portfolio characteristics
  • With the ability to short, the fund can exploit municipal market, interest rate hedging and credit spread duration opportunities
Team

David Hammer

Portfolio Manager, PIMCO

Performance

Performance (%)

  Jul'171 Q22 YTD2 1 YR2 3 YR2 5 YR2 10 YR2 SINCE
INCEPTION2
Institutional NAV 0.52 2.35 4.98 0.93 4.48 1.96 5.54
Investor NAV 0.52 2.10 4.87 0.55 4.11 1.57 5.15
Class A NAV* 0.39 2.22 4.71 0.45 3.97 1.44 2.24 2.04
Class A MOP** -5.37 -3.61 -1.35 -5.31 1.95 0.24 1.64 1.46
Class C NAV† 0.52 1.95 4.44 -0.04 3.49 0.96 4.62
Class C MOP‡ -0.48 0.95 3.44 -1.02 3.49 0.96 4.62
Barclays U.S. Municipal Bond Index 0.81 1.96 3.57 -0.49 3.33 3.26 4.60
Barclays U.S. Corporate High-Yield Bond Index 1.11 2.17 4.93 12.70 4.48 6.89 7.67

1. As of 07/31/2017
2. As of 06/30/2017

On March 29, 2017, Advisor Class shares were closed and outstanding shares were exchanged for Institutional Class shares.

Returns for periods greater than one year are annualized.
* Excludes sales charge.
** Reflects effects of the fund’s maximum sales charge of 5.75%.
† Excludes the effects of the 1% contingent deferred sales charge.
‡ Includes the effects of the 1% contingent deferred sales charge.

The performance quoted represents past performance, does not guarantee future results and current performance may be lower or higher than the data quoted. The investment return and principal value of an investment will fluctuate so that shares, when redeemed, may be worth more or less than their original cost. Performance data current to the most recent month end may be obtained on this website. Investment performance reflects fee waivers in effect. In the absence of fee waivers, total return would be lower. Total return is based on NAV, assuming reinvestment of all distributions. Performance does not reflect the deduction of taxes that a shareholder would pay on fund distributions or the redemption of fund shares.

Calendar Year Performance (%)

  2016201520142013201220112010200920082007
Institutional1.454.809.47-14.2014.436.234.5447.08
Investor1.084.398.97-14.4213.965.834.1746.56
Class A0.984.305.72-14.6013.695.684.1146.77-20.65-17.26
Class C0.553.687.96-14.9813.334.573.50
Barclays U.S. Municipal Bond Index0.253.309.05-2.556.7810.702.3812.91-2.473.36
Barclays U.S. Corporate High-Yield Bond Index17.13-4.472.457.4415.814.9815.1258.21-26.161.87

Growth of $10,000*** as of 06/30/2017

*** This chart illustrates the performance of a hypothetical $10,000 investment made in the fund on the commencement of its operations and assumes no additional deposits or withdrawals were made to the fund and assumes reinvestment of dividends and capital gains. This chart is not intended to imply any future performance of the fund. The chart does not reflect the deduction of taxes that a shareholder would pay on fund distributions or the redemption of fund shares.

Yield as of 07/31/2017

Investor DIVIDEND YIELD 2.70
Investor 30-DAY SEC YIELD (%) 2.91
Investor 30-DAY SEC YIELD (UNSUBSIDIZED) (%) 2.85
Class A DIVIDEND YIELD 2.62
Class A 30-DAY SEC YIELD (%) 2.61
Class A 30-DAY SEC YIELD (UNSUBSIDIZED) (%) 2.54
Institutional DIVIDEND YIELD 3.10
Institutional 30-DAY SEC YIELD (%) 3.26
Institutional 30-DAY SEC YIELD (UNSUBSIDIZED) (%) 3.19
Class C DIVIDEND YIELD 2.12
Class C 30-DAY SEC YIELD (%) 2.34
Class C 30-DAY SEC YIELD (UNSUBSIDIZED) (%) 2.25

Past performance does not guarantee future results.

Expense Ratio as of 05/01/2017

  Gross Net Including
Investment-Related Expenses
Net Excluding
Investment-Related Expenses
Investor 1.81% 1.79% 1.79%
Class A 1.96% 1.94% 1.94%
Institutional 1.46% 1.44% 1.44%
Class C 2.41% 2.39% 2.39%

Expenses stated as of the fund’s most recent prospectus. Investment dividend expense, interest expense, acquired fund fees and expenses and certain other fund expenses are included in the Net, Including Investment-Related Expenses and excluded from the Net, Excluding Investment-Related Expenses.

Under an expense limitation agreement, the investment advisor has contractually agreed to waive its management fee and/or reimburse or pay operating expenses of the fund to the extent necessary to maintain the fund’s total operating expenses at 1.79% for Investor Class, 1.44% for Institutional Class, 1.94% for Class A and 2.39% for Class C shares, excluding certain expenses, such as taxes, brokerage commissions, interest, short dividend expense, any acquired fund fees and expenses, litigation and extraordinary expenses. This expense limitation agreement expires on April 30, 2018, and may only be modified or terminated by a majority vote of the independent trustees. The advisor is permitted to recover waived expenses for a period of up to three years.

Portfolio

Top 10 Holdings (% of Net Assets) as of 06/30/2017

A Buckeye, Ohio Tobacco Settlement Financing Authority (6/1/2024) 6.88
B New Jersey Tobacco Settlement Financing Corp. Revenue Bonds 5.69
C The Lower Alabama Gas District Revenue Bonds 5.27
D Iowa Tobacco Settlement Authority 5.21
E Stockton Public Financing Authority Revenue Bonds 4.78
F Port Beaumont Navigation District Dock & Wharf Facilities Revenue Bonds 4.40
G Buckeye, Ohio Tobacco Settlement Financing Authority (6/1/2047) 3.98
H State of Texas, General Obligation Bonds 3.52
I Illinois Receivables Trust II 2.84
J Texas State Public Finance Authority, Taxable Revenue Bonds 2.83

These holdings may not reflect the current or future positions in the portfolio.

Sector Diversification (% of portfolio) as of 06/30/2017

Sector % Long % Short Total Exposure Net Exposure
Corporate Bonds 5.50 0.00 5.50 5.50
Future Contracts 0.00 -8.00 8.00 -8.00
Municipal Bonds 97.45 0.00 97.45 97.45
Short-Term Securities 5.05 0.00 5.05 5.05

These allocations may not reflect the current or future positions in the portfolio. Percentages may not add to 100% due to rounding.

Asset Class Correlation (%) as of 07/31/2017

Source: Morningstar. Data since inception (05/01/08 through 6/30/17).

Municipal Bonds- Barclays U.S. Municipal Bond Index; High-Yield Corporate Bonds- Barclays U.S. Corporate High-Yield Bond Index; Large Cap Stocks- S&P 500 Index; U.S. Bonds- Barclays U.S. Aggregate Bond Index

Fund Details as of 06/30/2017

Annual Portfolio turnover 276%
# of holdings 48

Risk Characteristics as of 06/30/2017

Beta 1.57
Correlation 0.76
Standard Deviation 9.03
Distributions & Tax Information

Distributions

Share Class Type Record Date Distribution
Rate
Ex-Dividend /
Reinvest /
Payable Date
Institutional Income Dividend 06/26/2017 $0.068 06/27/2017
Institutional Income Dividend 03/27/2017 $0.072 03/28/2017
Investor Income Dividend 06/26/2017 $0.061 06/27/2017
Investor Income Dividend 03/27/2017 $0.064 03/28/2017
Class A Income Dividend 06/26/2017 $0.059 06/27/2017
Class A Income Dividend 03/27/2017 $0.063 03/28/2017
Class C Income Dividend 06/26/2017 $0.050 06/27/2017
Class C Income Dividend 03/27/2017 $0.054 03/28/2017
Related Resources

You should consider a fund’s investment objectives, risks, charges and expenses carefully before investing. A prospectus with this and other information may be obtained by calling (800) 999-6809 or by downloading one from this website. It should be read carefully before investing.

Click here for fund-specific risks and definitions.

Fund Specific Risks

Salient Tactical Muni & Credit Fund

RISKS

There are risks involved with investing, including loss of principal. Past performance does not guarantee future results, share prices will fluctuate and you may have a gain or loss when you redeem shares.

Borrowing for investment purposes creates leverage, which can increase the risk and volatility of a fund.

Debt securities are subject to interest rate risk. If interest rates increase, the value of debt securities generally declines. Debt securities with longer durations tend to be more sensitive to changes in interest rates and more volatile than securities with shorter durations.

Derivative instruments involve risks different from those associated with investing directly in securities and may cause, among other things, increased volatility and transaction costs or a fund to lose more than the amount invested.

Foreign securities, especially emerging or frontier markets, will involve additional risks including exchange rate fluctuations, social and political instability, less liquidity, greater volatility and less regulation.

Investing in lower-rated (“high yield”) debt securities involves special risks in addition to those associated with investments in higher-rated debt securities, including a high degree of credit risk.

Investing in a non-diversified fund involves the risk of greater price fluctuation than a more diversified portfolio.

Short selling involves additional investment risks and transaction costs, and creates leverage, which can increase the risk and volatility of a fund.

Alternative strategies typically are subject to increased risk and loss of principal. Consequently, investments such as mutual funds which focus on alternative strategies are not suitable for all investors.

30-Day SEC Yield is based on a 30-day period and is computed by dividing the net investment income per share earned during the period by the maximum offering price per share on the last day of the period.

30-Day Unsubsidized SEC Yield is computed by dividing the net investment income per share earned during the period, excluding expense waivers or reimbursements, by the maximum offering price per share on the last day of the period.

Barclays U.S. Aggregate Bond Index represents securities that are U.S. domestic, taxable and dollar denominated. The index covers the U.S. investment grade fixed-rate bond market, with index components for government and corporate securities, mortgage pass-through securities and asset-backed securities. These major sectors are subdivided into more specific indices that are calculated and reported on a regular basis.

Barclays U.S. Corporate High-Yield Bond Index covers the USD-denominated, non-investment grade, fixed-rate, taxable corporate bond market. Securities are classified as high-yield if the middle rating of Moody’s, Fitch and S&P is Ba1/BB+/BB+ or below.

Barclays U.S. 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 pre-refunded bonds.

Beta is a measure of risk which shows a fund’s volatility relative to its benchmark index.

Correlation is a statistical measure of the interdependence of two random variables that range in value from -1 to +1, indicating perfect negative correlation at -1, absence of correlation at zero and perfect positive correlation at +1.

credit rating is an assessment of the credit worthiness of individuals and corporations. It is based upon the history of borrowing and repayment as well as the availability of assets and extent of liabilities.

Duration is a measure of the sensitivity of the price (the value of principal) of a fixed-income investment to a change in interest rates. Duration is expressed as a number of years.

Gross and net exposure measures how much a fund is exposed to market risk.

S&P 500 Index is an unmanaged index of 500 common stocks chosen to reflect the industries in the U.S. economy.

Standard deviation measures the degree to which a fund’s return varies from its previous returns or from the average of all similar funds.

One cannot invest directly in an index.

Effective November 13, 2013, PIMCO assumed direct management responsibility of the fund.

Advisor Class shares are available only to fee-based advisory platforms and retirement plans via omnibus accounts.