The objective of the Virginia Equity Fund (Ticker: VEFAX) is to provide long-term capital appreciation and income. To achieve its investment objective, the Fund invests primarily in the common stocks of publicly-traded companies headquartered in the Commonwealth of Virginia (“Virginia” or the “Commonwealth”) and common stocks of companies that otherwise have a significant impact on the economy of the Commonwealth (“Virginia Securities”).
At least 90% of the Fund’s net assets will normally be invested in common stocks, preferred stocks and convertible securities, with at least 80% of the Fund’s total assets invested in Virginia Securities.
Important Disclosures, Please Read
Investors should consider the investment objectives, potential risks, management fees and charges and expenses carefully before investing. This and other information is contained in the Fund’s prospectus, which may be obtained by calling 1-800-673-0550. Please read and carefully consider the prospectus before investing. Distributed by First Dominion Capital Corp., Richmond, VA. Member FINRA.
Past performance does not guarantee 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. Performance data current to the most recent month end may be obtained by calling 1-800-673-0550.
The information provided is subject to change daily. It is provided for informational purposes only, does not constitute an offer to sell, or the solicitation of an offer to buy any securities and must not be relied upon in connection with any investment decision.
Important Disclosure About Risks
There are risks associated with this Fund that may differ from other funds.
Overall stock market risks may affect the value of the Fund. Factors such as domestic economic growth and market conditions, interest rate levels, and political events affect the securities markets. When the value of the Fund’s investments goes down, your investment in the Fund decreases in value and you could lose money. In addition to common stocks, the Fund can invest in the equity or “equity equivalents” of preferred stocks and convertible securities. Preferred stocks generally pay a dividend and rank ahead of common stocks and behind debt securities in claims for assets of the issuer in a liquidation proceeding or in bankruptcy. The dividend rate of preferred stocks may cause their prices to behave more like those of debt securities. A convertible security is one that can be converted into or exchanged for common stock of the issuer within a particular period of time, at a specified price, upon the occurrence of certain events or according to a price formula. Convertible securities offer the Fund the ability to participate in stock market movements while also seeking some current income. Convertible debt securities pay interest and convertible preferred stocks pay dividends until they mature or are converted, exchanged or redeemed. The Fund considers some convertible securities to be “equity equivalents” because they are convertible into common stock. Small‐cap companies may have less access to financial resources and less experienced management than larger, more established companies. Small‐cap stocks may be less liquid than stocks of larger issuers. That means that the Fund could have greater difficulty selling small‐cap stocks at an acceptable price, especially in periods of market volatility. These factors increase the potential for losses to the Fund. It may take a substantial period of time before the Fund realizes a gain on an investment in a small‐cap company if it realizes any gain at all. The stocks of micro‐capitalization companies often have greater price volatility, lower trading volume, and less liquidity than the stocks of larger, more established companies. Micro‐cap companies may be newly formed or in the early stages of development, with limited product lines, markets or financial resources and may lack management depth. In addition, there may be less public information available about these companies. The shares of microcap-companies tend to trade less frequently than those of larger, more established companies which can adversely affect the pricing of these securities and the future ability to sell these securities. Because the Fund invests primarily in Virginia Securities, the value of the Fund’s portfolio also will be affected by the special economic and other factors that might affect issuers located in or having a significant impact in the Commonwealth of Virginia. The volatility associated with investments in growth stocks is likely to be even greater where the Fund’s investments are concentrated in a single state. A change in the economic environment of the Commonwealth will have a greater impact on the Fund than on a fund whose investments reflect a wider geographic distribution. There is no assurance that these factors and the other demographic and economic characteristics that the Adviser believes favor these companies exist now or will continue in the future. Moreover, it should be noted that numerous economic and political factors can have a detrimental effect on businesses within the Commonwealth. It should also be noted that many of the companies in which the Fund invests have operations in places other than Virginia. As a result, even if investing in Virginia is advantageous, many of the companies will derive a benefit from Virginia only partially or, in some cases, not at all. Investing in foreign investments carries potential risks not associated with domestic investments, which may include currency exchange rate fluctuations; political and financial instability; less liquidity and greater volatility; lack of uniform accounting, auditing and financial reporting standards; less government regulation and supervision; increased price volatility; and delays in transaction settlement in some foreign markets. Derivatives are investments the value of which is “derived” from the value of an underlying asset (including an underlying security), reference rate or index. The value of derivatives may rise or fall more rapidly than other investments. For some derivatives, it is possible to lose more than the amount invested in the derivative. If the Fund uses derivatives to “hedge” the overall risk of its portfolio, it is possible that the hedge may not succeed. This may happen for various reasons, including unexpected changes in the value of the rest of the Fund’s portfolio. Over the counter derivatives are also subject to counterparty risk, which is the risk that the other party to the contract will not fulfill its contractual obligation to complete the transaction with the Fund. The value of the Fund’s positions in index options fluctuates in response to changes in the value of the underlying index as well as changes in interest rates, dividends and market volatility. Writing index call options and index call spreads provides the opportunity for adding total return to the Fund through the collection of call premiums. Writing index call options and index call spreads may also limit the opportunity of the Fund to profit from an increase in the market value of the portfolio in exchange for the premium received at the time of selling the options or spreads. The Fund also risks losing all or part of the cash paid for purchasing index put options and index put spreads. Unusual market conditions or the lack of a ready market for any particular option at a specific time may reduce the effectiveness of the Fund’s option strategies, and for these and other reasons, the Fund’s option strategies may not reduce the Fund’s volatility to the extent desired. From time to time, the Fund may reduce its holdings of index options, resulting in an increased exposure to a market decline. The Fund is a non‐diversified portfolio, which means that it has the ability to take larger positions in a smaller number of securities than a portfolio that is “diversified.” Non‐diversification increases the risk that the value of the Fund could go down because of the poor performance of a single investment. The Fund was recently formed. Accordingly, investors in the Fund bear the risk that the Fund may not be successful in implementing its investment strategy, may not employ a successful investment strategy, or may fail to attract sufficient assets to realize economies of scale, any of which could result in the Fund being liquidated at any time without shareholder approval and at a time that may not be favorable for all shareholders. Such liquidation could have negative tax consequences. Additionally, the portfolio manager of the Fund does not have prior experience managing a registered investment company and that lack of experience may raise the risk associated with an investment in the Fund. Each of the preceding risks is discussed in the prospectus. Please see the prospectus for more complete information regarding the risks associated with the fund.