Does the protective hedge guarantee safety?
There are no guarantees in hedging. The Fund uses various investment strategies designed to help limit risk and to preserve capital. Though the Fund is not required to be hedged at all times, the hedging strategies include, among others, the use of swaps, futures contracts, short sales, options on futures or options based on U.S. Treasury securities, an index of longer-term securities or other instruments. We are particularly focused on hedging high-volatility market events such as employment release dates. The hedging strategies employed seek to achieve a relatively stable net asset value. There can be no guarantee that the Funds’ hedging strategies will be employed under all market conditions or will be successful. Additionally, the cost paid for the hedging strategies may result in a reduction of the net asset value of a Fund and, as a result, could make the Fund worse off than if such hedging strategies had not been used.
