Tactical Income Commentary

June 2019

The ACM Tactical Income Fund (TINIX) returned +1.94% compared to the Barclays US Aggregate Bond Index (AGG) which returned +1.26%. YTD, the Fund has returned +4.12% vs. +6.11% for the AGG. The Fund also paid a distribution in June equivalent to a 5.47% yield.

(The Fund returned +4.12% as of 6/30/19, and returned +4.12% since inception which was 12/31/18)

The performance data quoted here represents past performance. Current performance may be lower or higher than the performance data quoted above. Past performance is no guarantee of future results. The investment return and principal value of an investment will fluctuate so that investor’s shares, when
redeemed, may be worth more or less than their original cost. For performance information current to the most recent month-end, please call toll-free 844-798-3833.

Total annual fund operating expenses are 2.13% for Class A shares and 1.88% for Class I shares. Maximum sales charge for Class A shares is 5.75%The Fund’s investment adviser has contractually agreed to reduce its fees and/or absorb expenses of the Fund, at least until April 30, 2021, to ensure that the net annual fund operating expenses will not exceed 2.13% for Class A shares and 1.88% for Class I shares, subject to possible recoupment from the Fund in future years. Maximum sales charge for Class A shares is 5.75%. Please review the fund’s prospectus for more information regarding the fund’s fees and expenses. 

The ACM Tactical Income Fund employs a proprietary rules-based buy and sell discipline that provides position limits up to 12%, and the ability to reduce exposure down to zero. The Fund benefitted from several “risk-on” types of sector exposure during the month. The largest positive performance contributors were emerging market bonds, convertibles, and mortgage REITs. There were no negative performance contributors last month. These exposures contributed to TINIX outperforming its Morningstar category average and finishing in the top 20 funds in the category.

Prior to June, the previous month was marked by choppy markets amidst a trade fight looming with both China and Mexico, which caused volatility among “risk-on” asset classes. The tumultuous environment took a breather, however, as the broad tariffs suggested by the President were walked back over the first couple weeks of June. By mid-month, it was announced that President Trump would meet with President Xi Jinping of China at the G20 summit, which left investors optimistic that some respite from the trade tensions was coming.

Past performance does not guarantee future results.

The US High Yield Spread – the difference in yield of the US High Yield Index over US Treasuries – jumped to 4.70% at the end of May, a high not seen since the sharp selloff in December 2018, as trade tensions pushed investors out of “risk-on” assets. In June, however, junk bonds rebounded performed well in the face of trade tensions as the market grew increasingly confident that the Fed would step in to stimulate the economy should it falter.

Treasury yields also continued to drift downward, falling below the key 2.0% level by mid-June. Th aforementioned dovishness by the Fed certainly played a role, as did the further decline in marketbased inflation expectations. The bond market is still expressing a high level of skepticism, if not outright pessimism, that economic growth will rebound in the latter half of the year. Fortunately, our rules-based strategy affords us the luxury of not having to “bet” on the unknown outcome.

Thank you for your continued support.

Sincerely,
The Management team at ACM Funds

Sources: Standard & Poor’s, Stockcharts.com, Morningstar, FRED, YCharts

Investors are not able to invest directly in the indices referenced and unmanaged index returns do not reflect any fees, expenses or sales charges. For current performance information, please visit our performance page: http://acm-funds.com/tactical-income-performance/

There is no guarantee that any investment strategy will achieve its objectives, generate profits or avoid losses.

ETF’s are subject to specific risks, depending on the nature of the underlying strategy of the fund. These risks could include liquidity risk, sector risk, as well as risks associated with fixed income securities, real estate investments, and commodities, to name a few. Investments in foreign securities could subject the Fund to greater risks including, currency fluctuation, economic conditions, and different governmental and accounting standards.

Investors should carefully consider the investment objectives, risks, charges and expenses of the ACM Tactical Income Fund. This and other important information about the Fund is contained in the prospectus, which can be obtained by calling 1-844-798-3833. The prospectus should be read carefully before investing. The ACM Tactical Income Fund is distributed by Northern Lights Distributors, LLC, member.”http://www.finra.org/” FINRA. “http://www.sipc.org/” SIPC. Northern Lights Distributors, LLC and Ascendant Capital Management, LLC are not affiliated.

6529-NLD-06/18/2019

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