Investment Objective

The PIA High Yield MACS Fund’s primary objective is to seek a high level of current income. The Fund’s secondary objective is to seek capital growth when that is consistent with its primary objective.

Fund Facts (As of 6/30/24)

Style Benchmark: Bloomberg U.S. Corporate High Yield Index
Symbol: PIAMX
CUSIP: 00770X378
Fund Assets: $172 million
Fund Inception: 12.26.17
Expense Ratio: 0.20%

Overview

High yield corporate bonds may offer the opportunity for very attractive long-term returns, while exhibiting higher security specific risk and volatility relative to a traditional investment grade bond portfolio. The PIA High Yield MACS Fund attempts to outperform the Bloomberg U.S. Corporate High Yield Credit Index, while diversifying away the inherent security specific risks of high yield bond exposure.

• Holds approximately 100+ non-investment grade corporate bond issues
• Seeks to produce Alpha in the high yield asset class through an emphasis on small/mid-size issuers, where we believe we can add repeatable value.

The use of the High Yield MACS complements the firm’s individual security selection to provide diversified access to high yield credit and the potential for a fixed income portfolio that may offer more attractive long-term risk-reward.

Investment Process

PIA High Yield employs a disciplined, fundamental approach to evaluate high yield opportunities. PIA believes we can add value from our top-down decision-making as a result of our proprietary risk-adjusted quantitative/qualitative analysis and our willingness to completely avoid industries we believe do not warrant leveraged finance over the current business cycle. Additionally, we employ a high conviction approach toward credit selection within industries we favor.

Within those industries whose economics we believe to be resilient enough to support high financial leverage, our credit analysis shifts to a very granular “bottom-up” approach. We believe this is particularly important with mid-cap and small-cap companies, which we believe tend to offer the most attractive credit metrics and return potential. We favor smaller, oligopolistic companies that we feel can dominate small, domestic niche industries. We believe relative size within a respective industry is more important than absolute size when determining a company’s pricing power. Additionally, smaller companies receive less Wall Street research and often have fewer comparable issuers, which provides greater opportunity for our industry-specialization model to develop comparative advantages in both information and analytical judgment.

We believe our Alpha Thesis and Investment Approach differentiate us from our competitors:

• We are willing to significantly underweight or zero-weight unattractive industries, which has reduced default risk.
• We focus on small/mid-size issuers where we can maximize our research value added.
• We invest in businesses we believe can survive a complete business cycle. Our knowledge and conviction adds value in difficult economies.