Rational Funds Converts Second Hedge Fund

Rational Funds, a family of funds rooted in the investment philosophy of applying a rational approach to investing, today announced the launch of the Rational/NuWave Enhanced Market Opportunity Fund (NUXIX). The Fund is Rational Funds’ second hedge fund conversion and offers the same strategy as its predecessor.

NUXIX utilizes a strategy that has consistently delivered positive returns since its inception in 2013. The Fund’s investment strategy is comprised of two distinct components. The first is an actively managed U.S. equity strategy, investing primarily in S&P 500 large-cap equities. The second is a broadly diversified managed futures strategy, providing both long and short exposure across a wide variety of global financial and commodities markets. The blended portfolio seeks to deliver superior risk-adjusted returns compared to a long-only, non-leveraged equity portfolio, particularly during extended equity bear market scenarios.

“The NuWave team developed a successful strategy to generate both alpha and beta for investors seeking U.S. equity exposure, and Rational Funds is proud to bring this strategy to all investors,” said Jerry Szilagyi, CEO of Rational Funds. “With the Rational/NuWave Enhanced Market Opportunity Fund, investors get U.S. equity exposure in combination with a macro-focused long/short component that seeks to provide uncorrelated returns. In times of extended market downturn, this approach has the potential to neutralize the declines.”

The equity component of NUXIX employs a quantitative and systematic strategy to identify repetitive patterns of price behavior in U.S. equities that are indicative of prevailing market sentiment. Individual stocks that are identified as expected outperformers of the benchmark index are included in the portfolio’s position, while those identified as expected underperformers are either liquidated or excluded. Typically, positions are predominately in companies with market capitalizations of $5 billion or more, and include diversified holdings of a few hundred equities at any given time.

The managed futures component of the Fund employs a multi-model, systematic strategy that allocates across more than 50 markets worldwide. The strategy seeks to identify price trends through the application of hundreds of individual trading models, which collectively provide diversified exposure to futures markets. Exposure includes both financial futures (stock indices, fixed income and currencies) and commodity futures (energies, metals, grains, softs and meats), as well as international stock indices, bonds and currencies.