Fund Investors
Market Center
Closing price as of 3/8/2010
All information is for class A shares unless noted otherwise.
NAV % Change YTD Return
Value Fund
$18.70 +0.05%
Growth Fund
$13.62 -0.22%
Burkenroad Fund
$30.83 +0.36%
Burkenroad Fund Class D
$30.31 +0.36%
Quantitative Long/Short Fund
$13.25 +0.15%
Diversified International Fund
$18.05 +0.28%
Strategic Income Bond Fund
$15.95 N/A%
Government Money Market Fund
$1.00 N/A% N/A%

To view standardized performance, please click on the fund name above.

The 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 and current performance may be lower or higher than the performance quoted. For performance data current to the most recent month end, please click on the individual fund name or call
1-800-990-2434. The funds are available in other share classes.
Process

Large Cap Investment Process
While many firms employ one discipline in investment management, we use quantitative, technical and fundamental analysis in our investment process. Our quantitative model ranks stocks according to relative attractiveness of all of the stocks on the supervised list which is initially derived from the S&P 900. This quantitative discipline measures, assigns value, and ranks stocks according to fundamental characteristics such as:

  1. Price-to-Book
  2. Relative Price-to-Earnings
  3. Cash Flow Yield
  4. Implied Return
  1. Relative Strength
  2. Profitability Momentum
  3. Earnings Surprise
  4. Estimate Revision

A composite score is calculated and a quintile ranking is assigned to each stock. Stocks ranked in the first and second quintiles are buy candidates while stocks ranked in the fourth and fifth quintiles are sell candidates. In addition, models that rank stocks according to the trend in analysts' earnings estimates revisions and relative price strength are used to screen out stocks that lie in the bottom 30% of the market universe. This helps portfolio managers avoid stocks that might be 'value traps.'

While quantitative data is the primary driver of our equity decisions, we also do a qualitative overview where we review the following:

Company Specific Issues
  1. Strength of management
  2. Litigation issues
  3. Market dominance
  4. Product innovation
 External Environment
  1. Analysts' opinions
  2. Investor sentiment
  3. Political climate
  4. Demographics
  5. Economic conditions

Portfolio characteristics include high financial quality, a high level of market liquidity, lower price-to-earnings ratio and, historically speaking, return volatility equal to or below that of the broad market.


Hancock Horizon Burkenroad Fund Process
The Burkenroad Fund has a unique investment process that starts with a screening process focused on small cap stocks (less than $2 billion) located or doing business in Alabama, Florida, Georgia, Louisiana, Mississippi, and Texas. Once this screen is complete, stocks are filtered based on further quantitative analysis. Favorable stock choices should exhibit strong probability of earnings surprise, favorable relative stock momentum, positive estimate revision, low relative valuation metric (P/E and P/B), and strong cash flow yield. Portfolio sector and industry weightings are derived from the individual stock selection process, which uses both quantitative and qualitative analysis, with heavy emphasis placed on fundamental analysis. The fundamental analysis focuses on company specific and external environment issues that are relevant to the stock decision. The Director of Equities and Chief Investment Strategist have the final say on stock decisions. In addition to our own research, the Burkenroad Fund utilizes Tulane University’s BURKENROAD REPORTS for individual company research. The BURKENROAD REPORTS is an educational program on investment research in which selected students at Tulane University’s A.B. Freeman School of Business participate.

  1. The Fund and Horizon Advisers are NOT affiliated with Tulane University or the A.B. Freeman School of Business. Hancock Bank licenses the name “Burkenroad” from Tulane University. Neither Tulane University, the A.B. Freeman School of Business nor the students, faculty and staff of Tulane University have any involvement in the investment decisions, management or operations of the Fund.
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Hancock Horizon Quantitative Long/Short Fund Process
Using the S&P 1500 as the universe of stocks we choose from, our quantitative model ranks stocks according to their relative attractiveness based on the following factors:

  1. Company Buybacks
  2. Financial Strength
  3. Analyst Earnings Estimates
  1. Earnings Quality
  2. Economic Value Added (EVA)

After the model has ranked each individual stock in the universe, we use the same information to rank industries. Our strategy is to focus on buying the highest ranked stocks in the highest ranked industries and to “short” the lowest ranked stocks in the lowest ranked industries. Parameters are in place to maintain appropriate diversification among sectors and industries to reduce risk.

We also conduct a qualitative overview of each stock held in the portfolio using fundamental research and technical factors such as relative price strength.

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Hancock Horizon Diversified International Fund Process
The first step in the investment process is to screen the relevant universe of 1700 stocks to identify companies likely to outperform using a proprietary screen called Return Pattern Recognition®. The screen identifies companies currently exhibiting specific financial and economic characteristics that have historically proceeded periods of outperformance for stocks in their respective industries.

The approximately 150 best companies identified in the screening process are put through a second more rigorous review. In this step, EARNEST Partners develops an investment thesis for each company. This thesis must be tested and generally includes conversations with the company's management team and industry specialists, a review of the company's financial reports and condition, and analysis of the industry, competitive landscape and any real time events that might impact the company. EARNEST Partners seeks companies in attractive industries with developed strategies, talented and honest management teams, sufficient funding, and strong financial results. The collective experience and diverse perspectives of their investment team members are an advantage in determining which companies are best positioned to meet or exceed expectations. Any company that does not pass the exhaustive fundamental analysis is eliminated.

The final step in the investment process is to construct a portfolio that includes those stocks that are expected to have the best performance and that effectively manage risk. A statistical approach called downside deviation is used to measure the likelihood of significantly underperforming the assigned benchmark. Using this information, investments are selected that blend together to manage downside risk. The portfolio is reconstructed until downside deviation is within acceptable limits. The result is a portfolio of stocks with high expected excess returns and limited risk of meaningful underperformance.


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Fixed Income Investment Process
Our fixed income process focuses on dollar-denominated, value-added investment grade securities with an intermediate term duration structure. We focus primarily on the following sectors of the fixed income market: Agency Mortgage-Backed Securities, domestic Corporate Bonds, and U.S. Treasury and Agency securities. Typically, and under normal circumstances, no security held represents more than five percent of a portfolio's assets. In selecting investments for a portfolio, we analyze current market conditions and anticipated changes in bond prices, and subsequently invest in the types of securities we expect to offer the best balance between income and stability of principal.

We are a "top down" fixed income manager. Macro-economic outlook guides our overall strategy. The economy, interest rates, inflation, monetary policy, fiscal policy, and the shape of the yield curve are primary factors which influence our sector diversification, duration strategy and yield curve structure. Historical spread relationships versus risk free returns, and inflation are analyzed in search of undervalued securities. Self imposed issuer and duration limits (for example, the maximum range from our duration target is 35%) further guide and control our process. Economic meetings are held monthly and involve our Chief Investment Strategist, the Director of Fixed Income, the Director of Equity Research, and staff.

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