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LSOFX: Risk Management

At Long Short Advisors, risk management is thoroughly embedded throughout our investment process, and it shows our ability to operate within a long-established asset allocation comfort range. Our investment managers maintain an alignment of interest with our clients and have a significant portion of their net worth invested alongside them. We believe that by viewing equities from a credit perspective, we are able to remain conservative yet find investment opportunities others overlook. We are consistently monitoring position size, liquidity, geography,beta, market cap, and gross/net.

Risk Management & Downside Protection Strategy

 

  • What Can Go Wrong? 

Investment Approach: The first consideration is always, "what can go wrong?"  Downside protection is the basis of the LSOFX investment discipline.

  • Significant Wealth in Strategy

Prospector eats its own cooking, with a significant amount of internal capital invested alongside their clients.

  • No Leverage on Longs

LSOFX does not employ leverage on the long side and is restricted to 100%.

  • Short Book

Short book reduces net exposure.

  • Focus on Individual Company Risk

We seek strong underlying franchise and asset values as well as owner-oriented management behavior to reduce downside risk. 

  • Company-Specific Metrics

The strategy has a balance sheet focus that aids in assessing downside risk and to identify less financially leveraged companies with strong underlying franchise and asset values, as well as, owner-oriented management behavior.

  • Valuation

Use of multiple valuation methods, including free cash flow yield and private market value.

  • Operational Pedigree

Long Short Advisors has partnered with what we believe to be the best-in-class service providers in an effort to preserve the safety and integrity of investor capital, including Fidelity as prime broker, US Bank as custodian, an independent 3rd party fund administrator, and an independent board of trustees.

 

 

Sell Discipline

  • Valuation Goal Realized

Stock has reached the investment team’s assessment of intrinsic value

  • Investment Thesis Challenged

An unanticipated event, corporate action or new research changes the original investment thesis or assumptions

  • Evaporation of Free Cash Flow

Free cash flow is reduced faster than expected

  • A Better Idea 

Displacement in the portfolio by a better idea


Investment in shares of a long/short equity fund have the potential for significant risk and volatility.  A short equity strategy can diminish returns in a rising market as well as having the potential for unlimited losses.  These types of funds typically have a high portfolio turnover that could increase transaction costs and cause short-term capital gains to be realized.


You should carefully consider the investment objectives, potential risks, management fees, and charges and expenses of the Fund before investing. The Fund's prospectus contains this and other information about the Fund, and should be read carefully before investing.  You may obtain a current copy of the Fund's prospectus by calling (877) 336-6763. The performance data quoted represents past performance; past performance does not guarantee future results.  The investment return and principal value of an investment in the Fund will fluctuate so that an investor’s shares, when redeemed, may be worth more or less than their original cost.

Fund is distributed by Unified Financial Securities, LLC, 9465 Counselor's Row, Suite 200, Indianapolis, IN  46240. (Member FINRA)

Diversification does not ensure a profit or guarantee against loss.

Long Short Advisors is registered as an investment adviser with the Securities and Exchange Commission.

Information contained on this website does not constitute an offer to sell, or a solicitation of an offer to buy shares of the Fund, nor shall any shares be offered or sold to any person in any jurisdiction in which such offer, solicitation, purchase, or sale would be unlawful under the securities laws of such jurisdiction.

This site also is not intended to provide specific individual advice including, without limitation, investment, financial, legal, accounting, or tax advice.