Aristotle Strategic Credit Fund*
*This fund is closed to new investors with the intent to liquidate on or about August 31, 2023. For more information, please see the Supplement dated June 29, 2023 that is included in the prospectus, summary prospectus and SAI documents linked below.
Ticker: | ARSSX |
CUSIP: | 461 41Q 824 |
Inception: | December 31, 2014 |
Managers: | Douglas Lopez, CFA Terence Reidt, CFA |
Expense Ratio: | 2.68% (Gross) |
0.62% (Net) |
Prospectus | Summary Prospectus | SAI | Fact Sheet
Quarterly Commentaries
2023: Q1 |
2017: Q1 | Q2 | Q3 | Q4
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Investment Objective
The investment objectives of the Aristotle Strategic Credit Fund (the Fund) are to seek income and capital appreciation.
The Fund’s investment objective is not fundamental and may be changed by the Board of Trustees without shareholder approval, upon at least 60 days’ prior written notice to shareholders. There is no assurance that the Fund will achieve its investment objectives. The Fund’s investment strategies and policies may be changed from time to time without shareholder approval or prior written notice, unless specifically stated otherwise in the Prospectus or the Statement of Additional Information (SAI).
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Principal Strategies
Under normal circumstances, the Fund invests at least 80% of its net assets (plus any borrowings for investment purposes) in debt securities. The types of debt securities in which the Fund may invest include, but are not limited to, corporate bonds, notes and debentures of the U.S. and non-U.S. issuers, and bank loans of U.S. and non-U.S. corporate issuers. The Fund’s investments in foreign securities include securities in both developed and emerging markets.
The Fund may invest in debt securities of any maturity and credit quality. Under normal market conditions, the Fund’s Advisor, Aristotle Credit Partners, LLC (the Advisor), expects that the Fund will generally invest in investment grade corporate bonds as well as high yield bonds and in bank loans that are generally both rated in the “B” and “BB” quality tiers of the high yield categories by nationally recognized securities rating organizations at the time of purchase or, if unrated, determined by the Advisor to be of comparable credit quality. However, the Fund may also invest in corporate debt investments rated below “B”. The Advisor believes these securities with these credit ratings provide the optimal risk-adjusted performance over a market cycle. Investment grade securities are those rated in the Baa3 or higher categories by Moody’s Investors Service, Inc. (Moody’s), or in the BBB- or higher categories by Standard & Poor’s, a division of McGraw Hill Companies Inc. (S&P), or Fitch Ratings Ltd. (Fitch) or, if unrated by S&P, Moody’s or Fitch, determined by the Advisor to be of comparable credit quality. High yield bonds, commonly referred to as “junk bonds” and bank loans, are generally rated below investment grade by Moody’s, S&P, or Fitch.
In pursuing the Fund’s investment objectives, the Advisor uses a disciplined investment approach that integrates a top-down macroeconomic environment assessment with a bottom-up fundamental credit analysis. The Advisor seeks to identify and invest in securities of companies with stable or improving financial profiles.
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Performance
1 The Fund has an inception date of December 31, 2014.
2 The Fund is benchmarked to a blend of three indices: 1/3 Bloomberg Barclays U.S. High Yield Ba/B 2% Issuer Cap Index, 1/3 Bloomberg Barclays Intermediate U.S. Corporate Index and 1/3 Credit Suisse Leveraged Loan Index. The Bloomberg Barclays U.S. High Yield Loans Index was retired on September 30, 2016 and was replaced in the Aristotle Blended Index with the Credit Suisse Leveraged Loan Index effective October 1, 2016. The volatility (beta) of the Fund may be more or less than the benchmark or the indices. It is not possible to invest directly in this benchmark or in the indices.
3 The Aristotle Blended Index has been used as the primary benchmark of the Fund since its inception on December 31, 2014 and, compared to the Bloomberg Barclays U.S. Aggregate Bond Index, more accurately represents the overall composition of the Fund. The Bloomberg Barclays U.S. Aggregate Bond Index is shown as it effectively represents the performance of the broad bond market.
The total annual operating expenses are 2.68%, and net operating expenses are 0.62%.
Returns for performance under one year are cumulative, not annualized. Short-term performance, in particular, is not a good indication of the Fund’s future performance, and an investment should not be made based solely on returns. Because of ongoing volatility, fund performance may be subject to substantial short-term changes.
Performance data quoted here represent past performance. Past performance is no guarantee of future results. Investment return and principal value 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 the performance information quoted. To obtain performance information current to the most recent month-end, please call (844) 274-7868.
The Fund’s advisor has contractually agreed to waive certain fees and/or absorb expenses through April 30, 2024 to the extent that the annual operating expenses do not exceed 0.62% of the Fund’s average daily net assets. The Fund’s advisor may seek reimbursement from the Fund for waived fees and/or expenses paid for three fiscal years from the date of the waiver or payment. A redemption fee of 1.00% will be imposed on redemptions of shares within 30 days of purchase.
Fund Holdings**
Top Ten Issuers | % of Fund |
---|---|
RR Donnelley & Sons | 2.3% |
Tenet Healthcare | 2.1% |
AAdvantage Loyalty IP | 2.0% |
United Airlines Holdings | 1.9% |
Citigroup | 1.8% |
Griffon | 1.8% |
Capital One Financial | 1.7% |
United Airlines 2019- 2 Class B Pass Through Trust | 1.6% |
MGM Resorts International | 1.6% |
OneMain Finance | 1.5% |
Total | 18.3% |
** Top Ten Issuers as of March 31, 2023. Percentage weights are based on the total Fund excluding cash and cash equivalents and are subject to change. For a full list of all holdings, click here.
Quarterly Fund Holdings for the last fiscal year are available via the Annual Report, Semi-Annual Report and Schedule of Investments and can be found here.
Portfolio composition will change due to ongoing management of the Fund. References to specific securities or sectors should not be construed as recommendations by the Fund, its Advisor or Distributor.
An investment in the Fund is subject to risks and you could lose money on your investment in the Fund. The principal risks of investing in the Fund include, but are not limited to, market risk, fixed income securities risk, credit risk, high yield (“junk”) bonds risk, bank loans risk, interest rate risk, liquidity risk, valuation risk, management and strategy risk, sector focus risk, recent market events risk, portfolio turnover risk, foreign investment risk, extension risk, prepayment or call risk, cybersecurity risk and emerging markets risk.
Market Turbulence Resulting from COVID-19 – The outbreak of COVID-19 has negatively affected the worldwide economy, individual countries, individual companies and the market in general. The future impact of COVID-19 is currently unknown, and it may exacerbate other risks that apply to the Fund. To learn more about the Principal Risks of Investing in the Fund, please reference the prospectus.