The Tralucent Global Alt (Long/Short) Equity Fund ETF
On November 16th, 2023, Tralucent launched the ETF class of the fund, which is listed on the Toronto Stock Exchange (TSX) under the ticker TGAF. See our press release here!
Summary
The Fund has existed since March 2020 as an Offering Memorandum fund, offering A, M, and F classes. It is now being offered with a prospectus and an additional class on the TSX – symbol TGAF. The Fund offers immense value with its notable risk adjusted returns and very competitive fees.
Brief Overview and History
The Fund was created on March 31, 2020 as an Offering Memorandum fund under the name Tralucent Global Equity Fund with three original classes: Class A, M, and F. These three classes continue to be available on FundServ as TGF110, TGF120, and TGF 130 respectively.
On October 11, 2023 The Fund was relaunched after issuing a Simplified Prospectus as the Tralucent Global Alt (Long/Short) Equity Fund with one additional class - the ETF - to trade on the TSX.
On November 16th, 2023, Tralucent launched the ETF class, listed on the Toronto Stock Exchange (TSX) under the ticker TGAF. The ETF is available for purchase by anyone with access to the TSX.
Why Short?
Shorting allows the Fund to benefit from declining security prices, to potentially add to the rate of return, and to dampen the volatility when security prices are declining. Specifically, shorting activities between March 2020 and September 2023 have added almost 10 percentage points of value to the Fund’s unitholders. Most of this return came during 2022 when overall markets declined as much as 30 percent.
The Alt (Long/Short) – and why be Both
The Alt refers to Liquid Alternative. This is a type of mutual fund that allows the fund to take on leverage up to 300 percent of the value of the Fund. It also permits the Fund to short up to 50% of the value of the fund. By employing both strategies, the Fund is able to enjoy lowered volatility and an enhanced rate of return.
The Fund is a hedge fund
As the Fund has the ability to take on leverage and the ability to go short, it is a hedge fund. Investors must note that this is a hedge fund in the liquid alternative category.
Exemptive Relief to use History since March 2020
The Fund obtained exemptive relief to use its performance history since inception (March 2020) as the mutual fund materially follows the same strategy that it has followed since its inception.
What does the Fund Contain?
The fund is 100% long and 40% short. It is comprised of over 200 long positions – predominantly mid and large cap global US based companies – and 46 short positions.
The Nature of What You Own and Short
The Fund buys – with very few exceptions – established companies from around the world, from various sectors and industries. These companies have strong management, are highly competitive in nature and can withstand the test of time.
Conversely, the Fund is short securities that do not present the potential to appreciate over time.
No Performance Fees
The Fund does not charge any performance fees. It charges management fees and trading costs. Management fees vary by each class. The manager pays for all other administration charges. This may change in future without notice.
This class is available for purchase on the TSX under the symbol TGAF and has an MER of 0.97%.
It can be purchased by anyone with access to the TSX.
This class is a replica of TGF130 and, with regulatory relief, we present historical performance of TGF130.
Historical Performance of TGAF ETF as at November 30, 2024
| CAD Return (%) | |||||||||
| 1 Month | 3 Month | 6 Month | YTD | 1 Year | 3 Year | 5 Year | 10 Year | Since Inception | |
| TGF130 | 3.94% | 8.40% | 14.41% | 25.73% | 27.84% | 14.44% | - | - | 22.67% |
| MSCI ACWI | 4.44% | 7.76% | 13.55% | 27.47% | 30.09% | 10.99% | - | - | 16.96% |
Tralucent obtained exemptive relief to use historical data of TGF130 to be used as the historical performance of TGAF. Both classes TGF130 and ETF class have precisely similar expense ratios.
Prior to October 11, 2023, the Fund was offered via offering memorandum only and the Fund was not a reporting issuer during such prior period. The expenses of the Fund would have been higher during such prior period had the Fund been subject to the additional regulatory requirements applicable to a reporting issuer. Tralucent has obtained exemptive relief on behalf of the Fund to permit the disclosure of the prior performance data for the Fund for the time period prior to it becoming a reporting issuer. For greater clarity, the exemptive relief allows the Class E units of the Fund to disclose performance data that shows how the Class A units of the Fund have performed from March 31, 2020 to September 9, 2021 and the Class F units of the Fund have performed from September 9, 2021 to November 15, 2023.
Commissions, trailing commissions, management fees and expenses all may be associated with mutual fund investments. Please read the prospectus before investing. The indicated rates of return are the historical annual compounded total returns including changes in unit value and reinvestment of all distributions and does not take into account sales, redemption, distribution or optional charges or income taxes payable by any securityholder that would have reduced returns. Mutual funds are not guaranteed, their values change frequently and past performance may not be repeated.