Financials Income Fund

Overview

The Fund seeks to generate current income across various market environments with a secondary focus on generating positive total return. The Fund has a long-term focus on the financial sector and will invest primarily in banks, including senior and subordinated debt, TruPs and equities, as well as debt of other financial services companies, including finance companies, brokerage and advisory firms, insurance companies, BDCs and REITs. The Fund currently offers investors an attractive yield for investment-grade risk with low correlation to the broader fixed-income market. 

Performance

Total Returns (as of 12/18/18) NAV NAV Change Dollars NAV Daily Change (%) YTD (%)
Class I NAV $9.31 $0.01 0.11% 2.80%
Class A NAV $9.32 $0.01 0.11% 2.46%
MOP $9.53 $0.01 0.11% 0.14%
Class C NAV $9.24 $0.01 0.11% 1.81%
MOP $9.24 $0.01 0.11% 0.83%
Bloomberg Barclays Aggregate Bond Index n/a n/a 0.25% -0.48%
Total Returns (as of 11/30/18) Prior Mo. YTD 1 Year 3 Years 5 Years Since Inception1
Class I NAV 0.65% 2.53% 2.91% 2.59% n/a 2.97%
Class A NAV 0.74% 2.31% 2.77% 2.41% n/a 2.75%
MOP -1.49% 0.00% 0.44% 1.63% n/a 2.18%
Class C NAV 0.57% 1.59% 1.88% 1.59% n/a 1.97%
MOP -0.43% 0.61% 0.90% 1.59% n/a 1.97%
Bloomberg Barclays Aggregate Bond Index 0.60% -1.79% -1.34% 1.33% n/a 1.41%
Bloomberg Barclays Inv. Grade: Fin Institutions Index (USD) -0.12% -2.86% -2.29% 2.10% n/a 2.19%
Total Returns (as of 09/30/18) Prior Qtr. YTD 1 Year 3 Years 5 Years Since Inception1
Class I NAV 0.50% 1.76% 3.36% 2.28% n/a 2.90%
Class A NAV 0.33% 1.47% 3.01% 2.06% n/a 2.65%
MOP -1.96% -0.82% 0.67% 1.29% n/a 2.06%
Class C NAV 0.15% 0.98% 2.25% 1.30% n/a 1.89%
MOP -0.84% 0.00% 1.26% 1.30% n/a 1.89%
Bloomberg Barclays Aggregate Bond Index 0.02% -1.60% -1.22% 1.31% n/a 1.52%

Expense Ratios*

  Class A Class I Class C
Gross 1.38% 1.12% 2.13%
Net 0.94% 0.69% 1.69%

Performance data quoted represents past performance. Past performance is no guarantee of future results. The investment return and principal value of an investment in the Fund will fluctuate so that an investor’s shares, when redeemed, may be worth more or less than their original cost. Current performance may be lower or higher than what is stated.

1 The inception date of the Angel Oak Flexible Income Fund A Class and I Class (ANFLX and ANFIX) was 11/3/14, while the inception date of C Class (AFLCX) was 8/4/15. The returns of AFLCX shown for periods prior to the inception date include the returns of ANFLX and are adjusted to reflect the operating expenses of AFLCX.

NAV represents annualized returns without a sales charge. MOP represents annualized returns with the maximum sales charge. Class A has a maximum sales charge of 2.25%. Maximum Contingent Deferred Sales Charge (load) as a % of amount redeemed: Class A & I: None. Class C shares are subject to a CDSC of 1.00% if you redeem your shares within twelve (12) months of purchase, based on the lower of the shares’ cost or current net asset value.

*Gross expense ratios are reported as of the 5/31/18 prospectus. The net expense ratios are reported as of the 1/31/18 Annual Report and are referenced in the 5/31/18 prospectus. The Adviser has contractually agreed to waive fees through 5/31/19.

Growth of $10,000 Since Inception as of 9/30/18

This chart illustrates the performance of a hypothetical $10,000 investment made in Angel Oak Flexible Income Fund (ANFIX) I Shares since inception on 11/3/14. It assumes reinvestment of capital gains and dividends. This chart is not intended to imply any future performance.

Bloomberg Barclays U.S. Aggregate Bond Index: An unmanaged index that measures the performance of the investment-grade universe of bonds issued in the United States. The index includes institutionally traded U.S. Treasury, government sponsored, mortgage and corporate securities. Please note that an investor cannot invest directly in the index; therefore its performance does not reflect a reduction for fees or expenses incurred in managing a portfolio.

Record Date  Payable Date Reinvestment Price ($/share) Ordinary Income ($/share) ST Cap Gains ($/share) LT Cap Gains ($/share)
1/30/2018 1/31/2018 9.45 0.03235  –  –
2/27/2018 2/28/2018 9.46 0.02874  –  –
3/28/2018 3/29/2018 9.45 0.03230  –  –
4/29/2018 4/30/2018 9.42 0.03453  –  –
5/30/2018 5/31/2018 9.46 0.03413  –  –
6/28/2018 6/29/2018 9.41 0.03498  –  –
7/30/2018 7/31/2018 9.39 0.03602  –  –
8/30/2018 8/31/2018 9.37 0.03787  –  –
9/27/2018 9/28/2018 9.33 0.03727  –  –
10/30/2018 10/31/2018 9.30 0.03846  –  –
11/29/2018 11/30/2018 9.33 0.03854  –  –
Total 2018     0.38519    

Record Date  Payable Date Reinvestment Price ($/share) Ordinary Income ($/share) ST Cap Gains ($/share) LT Cap Gains ($/share)
1/30/2017 1/31/2017 9.42 0.03217  –  –
2/27/2017 2/28/2017 9.46 0.03310  –  –
3/30/2017 3/31/2017 9.41 0.03766  –  –
4/27/2017 4/28/2017 9.40 0.03629  –  –
5/30/2017 5/31/2017 9.40 0.03602  –  –
6/29/2017 6/30/2017 9.42 0.03374  –  –
7/30/2017 7/31/2017 9.43 0.03511  –  –
8/30/2017 8/31/2017 9.46 0.03400  –  –
9/28/2017 9/29/2017 9.45 0.03249  –  –
10/30/2017 10/31/2017 9.48 0.03030  –  –
11/29/2017 11/30/2017 9.49 0.03032  –  –
12/29/2017 12/29/2017 9.50 0.03250  –  –
Total 2017     0.40370    

Record Date  Payable Date Reinvestment Price ($/share) Ordinary Income ($/share) ST Cap Gains ($/share) LT Cap Gains ($/share)
1/29/2016 1/30/2016 9.56 0.03648  –  –
2/26/2016 2/29/2016 8.86 0.05012  –  –
3/30/2016 3/31/2016 9.08 0.03965  –  –
4/28/2016 4/29/2016 9.20 0.03968  –  –
5/27/2016 5/31/2016 9.17 0.03667  –  –
6/29/2016 6/30/2016 9.18 0.03401  –  –
7/28/2016 7/29/2016 9.33 0.03445  –  –
8/30/2016 8/31/2016 9.34 0.03509  –  –
9/29/2016 9/30/2016 9.36 0.03374  –  –
10/30/2016 10/31/2016 9.35 0.03478  –  –
11/29/2016 11/30/2016 9.37 0.03377  –  –
12/27/2016* 12/28/2016* 9.37 0.01248  –  –
12/29/2016 12/30/2016 9.38 0.03523  –  –
Total 2016     0.45615    

*Due to our annual tax review, there was additional earned income that was required to be paid out prior to the calendar year end.

Record Date  Payable Date Reinvestment Price ($/share) Ordinary Income ($/share) ST Cap Gains ($/share) LT Cap Gains ($/share)
1/29/2015 1/30/2015 10.13 0.01451
2/27/2015 2/28/2015 10.17 0.00540
3/30/2015 3/31/2015 10.23 0.03107
4/29/2015 4/30/2015 10.27 0.04528  –  –
5/28/2015 5/29/2015 10.38 0.04012  –  –
6/29/2015 6/30/2015 10.27 0.03770  –  –
7/30/2015 7/31/2015 10.27 0.03784  –  –
8/28/2015 8/31/2015 10.22 0.03532  –  –
9/29/2015 9/30/2015 10.08 0.03987  –  –
10/29/2015 10/30/2015 10.01 0.03979    
11/27/2015 11/30/2015 9.98 0.04070  –  –
12/29/2015* 12/30/2015* 9.90 0.05814  –  –
Total 2015     0.42575    

*Due to our annual tax review, there was additional earned income that was required to be paid out prior to the calendar year end.

Record Date  Payable Date Reinvestment Price ($/share) Ordinary Income ($/share) ST Cap Gains ($/share) LT Cap Gains ($/share)
1/30/2018 1/31/2018 9.44 0.03434  –  –
2/27/2018 2/28/2018 9.45 0.03091  –  –
3/28/2018 3/29/2018 9.44 0.03418  –  –
4/29/2018 4/30/2018 9.40 0.03480  –  –
5/30/2018 5/31/2018 9.44 0.03596  –  –
6/28/2018 6/29/2018 9.39 0.03695  –  –
7/30/2018 7/31/2018 9.37 0.03796  –  –
8/30/2018 8/31/2018 9.35 0.03987  –  –
9/27/2018 9/28/2018 9.32 0.03926  –  –
10/30/2018 10/31/2018 9.29 0.04038  –  –
11/29/2018 11/30/2018 9.31 0.03908  –  –
Total 2018     0.40369    

Record Date  Payable Date Reinvestment Price ($/share) Ordinary Income ($/share) ST Cap Gains ($/share) LT Cap Gains ($/share)
1/30/2017 1/31/2017 9.41 0.03578  –  –
2/27/2017 2/28/2017 9.45 0.03609  –  –
3/30/2017 3/31/2017 9.40 0.04009  –  –
4/27/2017 4/28/2017 9.39 0.03877  –  –
5/30/2017 5/31/2017 9.39 0.03784  –  –
6/29/2017 6/30/2017 9.40 0.03582  –  –
7/30/2017 7/31/2017 9.41 0.03709  –  –
8/30/2017 8/31/2017 9.45 0.03594  –  –
9/28/2017 9/29/2017 9.43 0.03351  –  –
10/30/2017 10/31/2017 9.46 0.03214  –  –
11/29/2017 11/30/2017 9.48 0.03189  –  –
12/29/2017 12/29/2017 9.48 0.03437  –  –
Total 2017     0.42933    

Record Date  Payable Date Reinvestment Price ($/share) Ordinary Income ($/share) ST Cap Gains ($/share) LT Cap Gains ($/share)
1/29/2016 1/30/2016 9.56 0.04210  –  –
2/26/2016 2/29/2016 8.85 0.05198  –  –
3/30/2016 3/31/2016 9.07 0.04152  –  –
4/28/2016 4/29/2016 9.20 0.04211  –  –
5/27/2016 5/31/2016 9.16 0.03850  –  –
6/29/2016 6/30/2016 9.17 0.03584  –  –
7/28/2016 7/29/2016 9.33 0.03688  –  –
8/30/2016 8/31/2016 9.33 0.03761  –  –
9/29/2016 9/30/2016 9.36 0.03628  –  –
10/30/2016 10/31/2016 9.34 0.03769  –  –
11/29/2016 11/30/2016 9.37 0.03643  –  –
12/27/2016* 12/28/2016* 9.36 0.01300  –  –
12/29/2016 12/30/2016 9.37 0.03776  –  –
Total 2016     0.48770    

*Due to our annual tax review, there was additional earned income that was required to be paid out prior to the calendar year end.

Record Date  Payable Date Reinvestment Price ($/share) Ordinary Income ($/share) ST Cap Gains ($/share) LT Cap Gains ($/share)
1/29/2015 1/30/2015 10.13 0.01582
2/27/2015 2/28/2015 10.17 0.00655
3/30/2015 3/31/2015 10.23 0.03307
4/29/2015 4/30/2015 10.27 0.04636  –  –
5/28/2015 5/29/2015 10.38 0.04117  –  –
6/29/2015 6/30/2015 10.27 0.03920  –  –
7/30/2015 7/31/2015 10.27 0.03994  –  –
8/28/2015 8/31/2015 10.22 0.03715  –  –
9/29/2015 9/30/2015 10.09 0.04209  –  –
10/39/2015 10/30/2015 10.01 0.04191    
11/27/2015 11/30/2015 9.99 0.04296  –  –
12/29/2015* 12/30/2015* 9.91 0.06043  –  –
Total 2015     0.44665    

*Due to our annual tax review, there was additional earned income that was required to be paid out prior to the calendar year end.

Record Date  Payable Date Reinvestment Price ($/share) Ordinary Income ($/share) ST Cap Gains ($/share) LT Cap Gains ($/share)
1/30/2018 1/31/2018 9.37 0.02670  –  –
2/27/2018 2/28/2018 9.39 0.02294  –  –
3/28/2018 3/29/2018 9.38 0.02726  –  –
4/29/2018 4/30/2018 9.33 0.03375  –  –
5/30/2018 5/31/2018 9.37 0.02825  –  –
6/28/2018 6/29/2018 9.33 0.02902  –  –
7/30/2018 7/31/2018 9.30 0.03031  –  –
8/30/2018 8/31/2018 9.28 0.03195  –  –
9/27/2018 9/28/2018 9.25 0.03139  –  –
10/30/2018 10/31/2018 9.22 0.03280  –  –
11/29/2018 11/30/2018 9.24 0.03287  –  –
Total 2018     0.32724    

Record Date  Payable Date Reinvestment Price ($/share) Ordinary Income ($/share) ST Cap Gains ($/share) LT Cap Gains ($/share)
1/30/2017 1/31/2017 9.37 0.03217  –  –
2/27/2017 2/28/2017 9.40 0.03310  –  –
3/30/2017 3/31/2017 9.35 0.03766  –  –
4/27/2017 4/28/2017 9.34 0.03030  –  –
5/30/2017 5/31/2017 9.33 0.02955  –  –
6/29/2017 6/30/2017 9.35 0.02828  –  –
7/30/2017 7/31/2017 9.36 0.02946  –  –
8/30/2017 8/31/2017 9.39 0.02800  –  –
9/28/2017 9/29/2017 9.38 0.02975  –  –
10/30/2017 10/31/2017 9.40 0.02493  –  –
11/29/2017 11/30/2017 9.42 0.02567  –  –
12/29/2017 12/29/2017 9.42 0.02683  –  –
Total 2017     0.35570    

Record Date  Payable Date Reinvestment Price ($/share) Ordinary Income ($/share) ST Cap Gains ($/share) LT Cap Gains ($/share)
1/29/2016 1/30/2016 9.55 0.03465  –  –
2/26/2016 2/29/2016 8.84 0.04568  –  –
3/30/2016 3/31/2016 9.07 0.03378  –  –
4/28/2016 4/29/2016 9.19 0.03415  –  –
5/27/2016 5/31/2016 9.15 0.03166  –  –
6/29/2016 6/30/2016 9.16 0.02899  –  –
7/28/2016 7/29/2016 9.31 0.03445  –  –
8/30/2016 8/31/2016 9.31 0.03509  –  –
9/29/2016 9/30/2016 9.33 0.03374  –  –
10/30/2016 10/31/2016 9.31 0.03478  –  –
11/29/2016 11/30/2016 9.33 0.03377  –  –
12/27/2016* 12/28/2016* 9.32 0.01096  –  –
12/29/2016 12/30/2016 9.33 0.03523  –  –
Total 2016     0.42693    

*Due to our annual tax review, there was additional earned income that was required to be paid out prior to the calendar year end.

Record Date  Payable Date Reinvestment Price ($/share) Ordinary Income ($/share) ST Cap Gains ($/share) LT Cap Gains ($/share)
8/28/2015 8/31/2015 10.22 0.03294
9/29/2015 9/30/2015 10.08 0.03314
10/29/2015 10/30/2015 10.00 0.03688    
11/27/2015 11/30/2015 9.98 0.03662
12/29/2015* 12/30/2015* 9.90 0.05212
Total 2015     0.19170    

*Due to our annual tax review, there was additional earned income that was required to be paid out prior to the calendar year end.

(Since Inception) Fund Index1
Std. Deviation (%) 4.0 3.8
Sharpe Ratio 0.8 0.3
Correlation to Index 0.1 1.0
% Positive Months 73.9 56.5
% Negative Months 26.1 43.5

As of 9/30/18.

1Bloomberg Barclays U.S. Aggregate Bond Index.

Bloomberg Barclays U.S. Aggregate Bond Index: An unmanaged index that measures the performance of the investment-grade universe of bonds issued in the United States. The index includes institutionally traded U.S. Treasury, government sponsored, mortgage and corporate securities. Please note that an investor cannot invest directly in the index; therefore its performance does not reflect a reduction for fees or expenses incurred in managing a portfolio.

Correlation to Index: A statistical measure of how two securities move in relation to another. Index used for comparison is the Bloomberg Barclays U.S. Aggregate Bond Index.

Sharpe Ratio: A statistical measure that uses standard deviation and excess return to determine reward per unit of risk. A higher Sharpe ratio implies a better historical risk-adjusted performance. The Sharpe ratio has been calculated since inception using the 3-month LIBOR for the risk-free rate of return.

Standard Deviation: A statistical measure of portfolio risk used to measure variability of total return around an average, over a specified period of time. The greater the standard deviation over the period, the wider the variability or range of returns and hence, the greater the fund’s volatility—calculated since inception.

Portfolio

 

 
Community Bank Debt 75.3%
 
Non-Bank Financials 14.0%
 
Bank Equities 2.4%
 
CLOs1 3.3%
 
Cash + Liquidity 5.0%

As of 9/30/18.

1CLOs: Collateralized Loan Obligations

The portfolio is actively managed. Holdings and weightings are subject to change daily and are provided for informational purposes only and should not be deemed as a recommendation to buy or sell the securities mentioned. Fund composition is based on net assets. Please scroll down to see important information about the Fund. 

Management Team

Brad Friedlander

Brad Friedlander

Head Portfolio Manager

Investment industry since 1999
Read Bio

 
Sreeni Prabhu

Sreeni Prabhu

Co-CEO and CIO

Investment industry since 1998
Read Bio

 
Navid Abghari

Navid Abghari

Portfolio Manager

Investment industry since 2005
Read Bio

 
Johannes Palsson

Johannes Palsson

Portfolio Manager

Investment industry since 1997
Read Bio

 
Clayton Triick

Clayton Triick, CFA®

Portfolio Manager

Investment industry since 2008 
Read Bio

 
 

Fund Facts

Share Class Ticker CUSIP Inception Gross Expense Ratio* Net Expense Ratio*
Class A ANFLX 03463K109 11/3/14 1.38% 0.94%
Class I ANFIX 03463K208 11/3/14 1.12% 0.69%
Class C AFLCX 03463K604 8/4/15 2.13% 1.69%

*Gross expense ratios are reported as of the 5/31/18 prospectus. The net expense ratios are reported as of the 1/31/18 Annual Report and are referenced in the 5/31/18 prospectus. The Adviser has contractually agreed to waive fees through 5/31/19.

Fund Commentary

30-Day SEC Yield: The SEC yield is an annualized yield based on the most recent 30-day period. Subsidized yields reflect fee waivers in effect. Without such waivers, yields would be reduced. Unsubsidized yields do not reflect fee waivers in effect.

Bloomberg Barclays U.S. Aggregate Bond Index: An unmanaged index that measures the performance of the investment-grade universe of bonds issued in the United States. The index includes institutionally traded U.S. Treasury, government sponsored, mortgage and corporate securities. Please note that an investor cannot invest directly in the index; therefore its performance does not reflect a reduction for fees or expenses incurred in managing a portfolio.

The Fund can make short sales of securities, which involves the risk that losses in securities may exceed the original amount invested. The Fund may use leverage, which may exaggerate the effect of any increase or decrease in the value of securities in the Fund’s portfolio on the Fund’s Net Asset Value and therefore may increase the volatility of the Fund. Investments in foreign securities involve greater volatility and political, economic and currency risks and differences in accounting methods. These risks are increased for emerging markets. Investments in fixed income instruments typically decrease in value when interest rates rise. Derivatives involve risks different from and, in certain cases, greater than the risks presented by more traditional investments. Investments in asset-backed and mortgage-backed securities include additional risks that investors should be aware of, such as credit risk, prepayment risk, possible illiquidity and default, as well as increased susceptibility to adverse economic developments. Investment by the Fund in lower-rated and non-rated securities presents a greater risk of loss to principal and interest than higher-rated securities. The Fund is non-diversified, so it may be more susceptible to being adversely affected by a single corporate, economic, political or regulatory occurrence than a diversified fund. The Fund will incur higher and duplicative costs when it invests in mutual funds, ETFs and other investment companies. There is also the risk that the Fund may suffer losses due to the investment practices of the underlying funds. For more information on these risks and other risks of the fund, please see the prospectus. No investment strategy, including a total return strategy, can ensure a profit or protect against loss. Additionally, investing in a total return strategy may result in underperformance during a bull market.

Mutual fund investing involves risk; Principal loss is possible. Investments in debt securities typically decreases when interest rates rise. This risk is usually greater for longer-term debt securities. Investments in lower rated and non-rated securities present a greater risk of loss to principal and interest than higher rated securities. Investments in asset-backed and mortgage-backed securities include additional risks that investors should be aware of including credit risk, prepayment risk, possible illiquidity and default, as well as increased susceptibility to adverse economic developments. Derivatives involve risks different from, and in certain cases, greater than the risks presented by more traditional investments. Derivatives may involve certain costs and risks such as illiquidity, interest rate, market, credit, management and the risk that a position could not be closed when most advantageous. Investing in derivatives could lose more than the amount invested. The Fund may make short sales of securities, which involves the risk that losses may exceed the original amount invested. For more information on these risks and other risks of the Fund, please see the Prospectus.