March 2023
Since many former leading sectors topped out in early 2021, we have been cautioning investors from looking at the market-cap weighted S&P 500 and assuming everything still looks good. The true health of a bull market can be measured by the participation of the average stock (breadth), as well as broad leadership amongst different areas.
At the end of bull cycles, market leadership narrows considerable and only a handful of the largest market-cap stocks continue to work higher and mask the underlying condition of the broader market. This phenomenon started to surface in 2021 and continues today. Last year, although the SPX was down roughly -20%, the average stock fared much worse. So far this year we are seeing it again, with the largest market-cap names showing strength and the rest of the market struggling. Let’s look at some charts to put some numbers on it:

Past performance does not guarantee future results
In the above chart you’ll notice that although the SPX was higher in March, two much broader measures of the market both experienced declines last month. The Value Line Geometric Index (roughly 1700 stocks) fell -2.44% in March, while the Russell 2000 Index fell -4.85%. So, it was a rough month for stocks at large. Of course, the big quake that hit the market during March was the collapse of Silicon Valley Bank, which caused waves of panic throughout the market – at least for a time. Regional bank stocks have yet to recover, and the longer-term ramifications in terms of a potential contraction in credit and lending are likely to have a downward impact on economic growth in the near future.
It is also worth noting that the stock market had its run this year early. Going off the chart of the S&P 500, the index made its high on February 2nd. And if we update the above chart and run it from the market peak on Feb. 2nd, we see that although the SPX has traded mostly sideways with a little bit of downside, the other two more broad indexes have had more serious corrections in the last 2 months.

Past performance does not guarantee future results
So, you can see from the above examples that this has been a difficult market for the average stock. And for a Fund like ours which focuses on finding emerging leaders to uncover winning stocks, there have been few breakouts that can make much headway. Leadership outside of the mega caps is scarce, making risk management a top priority.
With all of the recession talk, and many of our indicators still flashing caution signals, we wonder if there is another leg down in the market that might mark the final low for the bear market. We will continue to monitor our screens and hedge model and await the next good buying opportunity.
Thank you for your continued support–
Sincerely,
Jordan L. Kahn, CFA
Chief Investment Officer
Sources: Standard & Poor’s, Stockcharts.com, Morningstar Briefing.com
Performance is historic and does not guarantee future results. Investment principal value will fluctuate so that when redeemed, shares may be worth more or lessthan their original cost. Current performance may be lower or higher than the performance dataquoted. To obtain the most recent month end performance information or the Fund’s prospectus pleasecall the Fund at 1-844-798-3833. You can also obtain a prospectus at www.ACM-funds.com.
Risk Disclosure:
Investors should carefully consider the investment objectives, risks, charges and expenses of the ACM Dynamic Opportunity 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 Dynamic Opportunity 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.
Defined Terms: S&P 500 Index- The S&P 500 index is an unmanaged composite of large capitalization companies. This index is widely used by professional investors as a performance benchmark for large-cap stocks. HFRX Equity Hedge Index– tracks strategies that maintain positions both long and short in primarily equity and equity driven securities. Morningstar Long/Short Equity Category- A composite of returns produced by Morningstar which can be used to compare the returns of other mutual funds in the same category. Long– the holder of the position owns the security and will profit if the price of the security goes up. Short- Short selling is the sale of a security that is not owned by the seller, or that the seller has borrowed. Short selling is motivated by the belief that a security’s price will decline, enabling it to be bought back at a lower price to make a profit. Derivative hedge – transaction that limits investment risk with the use of derivatives such as option contracts.
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: https://acm-funds.com/dynamic-fund-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.
6179-NLD-04/26/2023
March 2023 Fact Sheet
Fund Overview
We strive to help our investors participate in the gains available from financial markets, while mitigating the downside risk
The ACM Dynamic Opportunity Fund is designed as a core investment for investors seeking long term capital appreciation with a short-term focus on capital preservation. The fund employs a dynamic strategy, which aims to actively participate during a rising market environment and mitigate downside risk when markets experience downturns.
Performance | As of 3/31/2023 | ||||||
1-mth | 3-mth | YTD | 1 Yr* | 3 Yr* | 5 Yr* | Since Inception* | |
ADOIX | -1.38% | -3.42% | -2.96% | -11.04% | 4.32% | 3.03% | 1.13% |
HFRX Eq Hedge | 0.61% | -0.15% | 1.41% | -2.12% | 9.72% | 2.69% | 2.56% |
Morningstar L/S Category | 0.38% | 1.78% | 1.78% | -3.88% | 8.98% | 3.70% | -3.92% |
S&P 500 | 1.46% | 2.28% | 8.59% | -9.29% | 16.71% | 9.04% | 9.24% |
*As of 3/31/23
Investments in mutual funds involve risks. Performance is historic and does not guarantee future results. Investment principal value will fluctuate so that when redeemed, shares may be worth more or less than their original cost. Current performance may be lower or higher than the performance data quoted. To obtain the most recent month end performance information or the Fund’s prospectus please call the Fund at 1-844-798-3833. You can also obtain a prospectus at www.ACM-funds.com.
The fund’s maximum sales charges for Class “A” shares is 5.75%. Gross expense ratios are 2.07% for Class A shares and 1.82% for Class I Shares. The Adviser has contractually agreed to reduce its fees and reimburse expenses of the Fund, at least Until April 30, 2022, to ensure that the net annual fund operating expenses will not exceed 2.40% for Class A shares and 2.15% for Class I shares.
These fee waivers and expense reimbursements are subject to possible recoupment from each Fund within three years after the fees have been waived or reimbursed. You should be aware that the Fund’s past performance (before and after taxes) may not be an indication of how the Fund will perform in the future. Although Class A Shares would have similar returns to Class I shares because the classes are invested in the same portfolio of securities, the returns for Class A shares are different from Class I shares because Class A shares have different expenses than Class I shares. Updated performance information is available at no cost by visiting www.ACM-funds.com or by calling 1-8444-798-3833. Actual Total Annual Operating Expenses of 1.95% for Class A and 1.70% for Class I from the prospectus.
Sector Weightings
As of 3/31/2023
There is no assurance that the Fund will achieve its investment objectives.
Dynamic Opportunity Fund | ||
Amazon.com, Inc. | 2.60% | |
Alphabet, Inc. | 2.18% | |
NVIDIA Corporation. | 1.95% | |
MercadoLibre, Inc. | 1.85% | |
Quanta Services, Inc. | 1.75% | |
Apple, Inc. | 1.73% | |
Academy Sports & Outdoors, Inc. | 1.55% | |
Advanced Micro Devices, Inc. | 1.51% | |
Super Micro Computer, Inc. | 1.49% | |
Fair Isaac Corporation. | 1.38% |
Fund Characteristics * | |
# Holdings | 38 |
Avg. Market Cap | $60,363M |
Avg. P/E | 23.3 |
Avg. ROE | 26.8% |
Gross Long Exposure | 46.8% |
Gross Short Exposure | -2.6% |
Net Market Exposure | 44.2% |
Beta Adj. Exposure | 54.3% |
Yearly Returns | 2015* | 2016 | 2017 | 2018 | 2019 | 2020 | 2021 | 2022 |
ADOIX | 5.73% | -4.67% | 17.86% | -0.97% | 2.36% | 22.47% | 0.93% | -12.79% |
HFRX Eq Hedge | -1.61% | 0.10% | 9.98% | -9.42% | 10.71% | 4.60% | 12.14% | -3.18% |
Morningstar L/S Category | -2.20% | 2.34% | 11.18% | -6.73% | 11.90% | 7.89% | 18.05% | -7.57% |
S&P 500 | 1.06% | 9.54% | 19.42% | -6.24% | 28.88% | 16.26% | 26.89% | -19.44% |
*Inception Date 1/20/2015
Risk Disclosure:
Investors should carefully consider the investment objectives, risks, charges and expenses of the ACM Dynamic Opportunity 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 Dynamic Opportunity 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.
Mutual Funds involve risk including possible loss of principal. Adverse changes in currency exchange rates may erode or reverse any potential gains from the Fund’s investments. 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 underlying funds that own small and mid-capitalization companies may be more vulnerable than larger, more established organizations. Derivative instruments involve risks different from, or possibly greater than, the risks associated with investing directly in securities and other traditional investments. Investments in foreign securities could subject the Fund to greater risks including currency fluctuation, economic conditions, and different governmental and accounting standards. In addition to the risks generally associated with investing in securities of foreign companies, countries with emerging markets also may have relatively unstable governments, social and legal systems that do not protect shareholders, economies based on only a few industries, and securities markets that trade a small number of issues.
Investors bear the risk that the Fund may not be able to implement its investment strategies or attract sufficient assets. Purchased put options may decline in value or expire worthless and may have imperfect correlation to the value of the Fund’s portfolio securities. Written call and put options may limit the Fund’s participation in equity market gains and may amplify losses in market declines. The Fund’s losses are potentially large in a written put or call transaction. If unhedged, written calls expose the Fund to potentially unlimited losses. The Fund will incur a loss as a result of a short position if the price of the short position instrument increases in value between the date of the short position sale and the date on which an offsetting position is purchased. Short positions may be considered speculative transactions and involve special risks, including greater reliance on the ability to accurately anticipate the future value of a security or instrument. The Fund’s losses are potentially large in a short position transaction.
Price to Earnings (P/E) is a valuation ratio of a company’s current share price compared to its per share earnings. Gross Long and Short Exposure is the percentage in securities that are expected to rise and decline, respectively. Beta is a measure of systemic risk. Standard Deviation is a statistical measurement. It sheds light on the historical volatility of that investment. The greater the standard deviation of a security, the greater the variance between each price and the mean, indicating a larger price range. Treynor ratio – A performance metric for determining how much excess return was generated for each unit of risk taken on by a portfolio. HFRX Equity Hedge Index – tracks strategies that maintain positions both long and short in primarily equity and equity driven securities. S&P 500 Index – tracks 500 individual stocks chosen for market size, liquidity and industry grouping, among other factors.
Investors are not able to invest directly in the indices referenced in this illustration and unmanaged index returns do not reflect any fees, expenses or sales charges.