VICE FUND: MAY 2021 – COMMENTARY LETTER
For the month of May, the Fund was -1.07%.
Market Review
Global equity markets were generally flat in May with small upticks in the U.S. and globally. Notably, volatility has dropped to near pre-pandemic levels in both equity and bond markets. Fears of moving back to lockdown economics have receded. We believe this is a positive development for our portfolio positioning, particularly gaming stocks.
As pandemic fears have receded, reflationary forces began pushing up cyclicals and commodities early in the month. Near-term inflation in May was very much a classic supply-demand imbalance caused by supply chain delays during the pandemic. As the supply component of the equation recovers, we believe demand during the re-open will continue to be strong, particularly in our gaming stocks.
Moreover, the Fund invests a large portion of the portfolio in non-cyclical stocks. Historically, alcohol and tobacco are fairly insulated from inflation with brand loyalty and price inelasticity. We believe these stocks will continue to do well even if prices continue to rise and this reflationary period is more that transitory.
Despite this near-term inflation, credit markets are not reflecting fears of long-term hot inflation since the 10-year Treasury Note remains stuck around a 1.5% yield. In short, we believe consumer discretionary stocks – the core names in the Vice Global Fund – will perform well even with some inflation, and bond markets appear priced for this type of set up.
We remain bullish on equities in the Fund’s universe of stocks, especially foreign and small-cap stocks, in the near-term. We continue to position the portfolio for continued weakness in the U.S. dollar, a rise in raw materials, and increased consumer spending.
Sincerely yours,
Past performance does not guarantee future results. The performance data quoted represents past performance and current returns may be lower or higher. Share prices and investment returns fluctuate and an investor’s shares may be worth more or less than original cost upon redemption. For performance data as of the most recent month-end please call 1-866-264-8783.
Standardized performance as of (3/31/2021) Fund Inception (02/01/2002)
| 1 Year | 5 Year | 10 Year | Since Inception | |
| VICEX | 47.26% | 7.13% | 9.74% | 9.17% |
| MSCI World Index | 55.31% | 13.81% | 9.73% | 9.45% |
Investor Class performance data quoted represents past performance; past performance does not guarantee future results. The investment return and principal value of an investment will fluctuate so that an investor’s shares, when redeemed, may be worth more or less than their original cost. Current performance of the fund may be lower or higher than the performance quoted. Performance data current to the most recent month end may be obtained by calling 1-866-264-8783. Returns over one year are annualized. The Gross and Net expense 1.67% and 1.49%. Contractual fee waivers through 07/31/2021.
DEFINITIONS:
The MSCI All Country World Index Total Return (“MSCI ACWI TR”) captures large and mid-cap representation across 23 Developed Markets (DM) and 26 Emerging Markets (EM) countries.
SYMBOL: VICEX
6350-NLD-07/13/2021