Q3 2017
ENTREPRENEUR US SMALL CAP FUND
DISTRIBUTION OF MONTHLY RETURNS (January 17, 2013 – September 30, 2017)
IMPAX
Russell 2000 (TR)
Russell 2000Growth
8 10 12 14 15 17
15 ENTREPRENEURIAL TRAITS:
4 6
1. Organic growth opportunities
2
2. Above average ownership stake among key stakeholders
0
8 to 10
< -10
10 to -8
-8 to -6
-6 to -4
-4 to -2
-2 to 0
0 to 2
2 to 4
4 to 6
6 to 8
>10
Returns (%)
3. Low selling, general and administrative expenses
ENTREPRENEURS BY SECTOR (By Percent of Strategy)
Utilities
Healthcare
0%
32.32%
4. Above average return on invested capital
Telecommunications
Financials
1.20%
11.33%
5. Sustainable growth
Materials
Energy
0.94%
1.25%
6. Manageable debt
Information Technology
Consumer Staples
29.93%
4.15%
7. Active strategic alliances /partnerships/licensing
Industrials
Consumer Discretionary
5.06%
10.36%
8. Aligned executive
Real Estate
1.88%
compensation packages
TOP 10 HOLDINGS
9. Low executive turnover
10. Transparent governance
1. Kite Pharma Inc (1.81%) 2. Clovis Oncology Inc (1.40%) 3. Puma Biotechnology Inc (1.39%) 4. Medidata Solutions Inc (1.37%) 5. Hubspot Inc (1.36%)
6. Parexel International Cor (1.34%) 7. Epam Systems Inc (1.33%) 8. Monolithic Power System (1.33%)
11. Long duration of key managers
9. Fibrogen Inc (1.32%) 10. Masimo Corp (1.28%)
12. Low or no dividends
13. Family involvement
INVESTMENT PROCESS
14. High EBITDA margin %
The investment objective of the Entrepreneur US Small Cap Fund is to provide positive alpha and upside capture for its clients. The fund is benchmarked against the Russell 2000 Index. The selection process utilizes quantitative filters for initial screenings and then applies qualitative, fundamental analysis for final active selections. The fund manager performs daily portfolio monitoring and quarterly rebalancing (at minimum). The fund seeks consistent, long-term growth.
15. Other significant
stakeholder relationships
DISCLAIMER
The fund’s investment objectives, risks, charges and expenses must be considered carefully before investing. The prospectus contains this and other important information about the investment company, and it may be obtained by calling 1-877-271-8811 or visiting www.ershares.com. Read it carefully before investing. Distributed by Rafferty Capital Markets, LLC, Garden City, NY 11530. The Entrepreneur U.S. Small Cap Fund invests in smaller companies, which involve additional risks such as limited liquidity and greater volatility. The Fund is exposed to common stock risk. Common Stock prices fluctuate based on changes in a company’s financial condition and on overall market and economic conditions. Additional risks are detailed in the prospectus. The Russell 2000 Total Return Index is a subset of the Russell 3000 Total Return Index representing approximately 10% of the total market capitalization of that index. It includes approximately 2000 of the smallest securities based on a combination of their market cap and current index membership. The Russell 2000 Growth Index is composed of small-capitalization US equities that exhibit growth characteristics. Alpha compares the risk-adjusted performance of a portfolio to a benchmark index. A positive alpha means the portfolio has outperformed the index on a risk-adjusted basis. Beta is a measure of the volatility of a portfolio in comparison to a benchmark index. Less than one means the portfolio is less volatile than the index, while greater than one indicates more volatility than the index. Standard deviation measures historical volatility. Higher Standard Deviation implies greater volatility. Sharpe Ratio measures risk-adjusted performance by dividing the portfolio’s excess returns (returns above a "risk-free" rate such as a Treasury bill) by the standard deviation of those returns. The higher the ratio, the better the portfolio’s return per unit of risk. The Up Capture ratio is the statistical measure of an investment manager’s performance in up-markets. The Down Capture ratio is the statistical measure of an investment manager’s performance in down-markets. Information Ratio is a ratio of portfolio returns above the returns of a benchmark compared to the volatility of those returns. The P/E (or Price/Earnings) ratio is the ratio of a company’s share price to its earnings per share. Earings before interest, tax, depreciation and amortization (EBITDA) is a measure of a company's operating performance.
ENTREPRENEURSHARES | 175 Federal St, Suite 875 Boston, MA 02110 | 617 279 0045 www.ershares.com | US SMALL CAP FUND
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