(NYSE: DOGS) can be found through your financial advisor or at most leading online brokers.
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Due to the psychology of recency most investors stay away when a country market has a bad year, but Arrow DOGS of the World ETF seeks out these opportunities. We invest in the five worst-performing markets of the preceding year, a strategy that could allow us to often capture dramatic gains in subsequent years.
The five countries in DOGS ETF in 2019 are Turkey, Argentina, Pakistan, Greece, and Mexico.
SYSTEMATIC PROCESS
There’s more to our process than simply buying the laggards. While we invest across the five bottom performing markets to reduce volatility, we concentrate our exposure in the worst performing market, allocating 30% to it versus 17.5% to the other markets. We obtain market exposure to each country market’s largest, most liquid stocks — and we buy and hold positions for a full year to maximize our ability to benefit from “reversion to the mean”.
OUR
APPROACH PRODUCES REAL DIVERSIFICATION
Arrow DOGS of the World ETF has lower
correlation with U.S. stocks than most diversified global strategies.
Correlation-Measures how closely two securities movement are associated, Ranging from 100% (High) to -100% (Low).
Risk-is a measure of volatility based on the annualized standard deviation of returns.
Past performance does not guarantee future results. For more information on the Morningstar categories see below. Index returns assume reinvestment of dividends, but do not reflect any management fees, transaction costs or expenses. Indexes are generally unmanaged and are not available for direct investment. Data Source: Morningstar, June 30, 2019, calculated by Arrow.
A SINGLE ETF ACCESS TO FRONTIER AND EMERGING MARKETS
(DOGS) is an ETF that provides easy exposure to frontier, emerging and developed countries that are seeking to recover from under-performing markets.
Its buy, hold and sell discipline follows the Contrarian Approach, designed to capture “mean reversion” by utilizing securities from countries that are often times hard to access.
Arrow Funds is a company with a passion and energy for helping investors meet their investment goals. We believe in offering sophisticated, targeted portfolio solutions for ever-changing markets. Arrow Funds are deployed by advisors, businesses, endowments and foundations, family offices as well as qualified and non-qualified retirement plans.
Morningstar Categories
Categories are based on Morningstar category data. Category returns assume reinvestment of dividends and are net of management fees, transaction costs or expenses. The number of funds in a category will vary, subject to survivorship bias from fund closure and recategorization. The driving principles behind the Morningstar classification system is categories have enough constituents to form the basis for reasonable peer group comparisons and portfolios within a category invest in similar types of securities. The distinctions between categories are meaningful to investors and assist in their pursuit of investing goals. Here is a breakdown of each category. Large Blend category are portfolios are fairly representative of the overall US stock market in size,
growth rates and price, the portfolios' returns are often similar to those of the S&P 500 Index. Foreign Large-Value category are portfolios invest mainly in big international stocks that are less expensive or growing more slowly than other large-cap stocks. Foreign Large-Blend category are portfolios invest in a variety of big international stocks. Foreign Small/Mid-Blend category are portfolios that invest in a variety of international stocks that are smaller. Diversified Emerging Markets category are stock portfolios tend to
divide their assets among 20 or more nations, although they tend to focus on the emerging markets of Asia and Latin America rather than on those of the Middle East, Africa, or Europe. Diversified Pacific/Asia ex-Japan category are stock portfolios have a wider investment range than other Asia-oriented portfolios excluding Japan stocks. Most of these portfolios focus on export-oriented nations such as Hong Kong, Singapore, Taiwan, and Korea. Europe Stock category are portfolios invest at least 70% of total assets in equities
and invest at least 75% of stock assets in Europe. Most of these portfolios emphasize the region's larger and more developed markets,
including Britain, the Netherlands, Germany, France, and Switzerland. Latin America Stock category are portfolios invest almost exclusively in stocks from Latin America. Most of these portfolios strongly favor the area's large markets, specifically Brazil, Mexico, and Argentina. China Region category are portfolios invest almost exclusively in stocks from China, Taiwan, and Hong Kong. India Equity category are portfolios emphasize companies based in India. Japan Stock category are portfolios emphasize companies based
in Japan.
Arrow Dogs of the World ETF may not be suitable for all investors. New funds have a limited performance record. Exchange traded products are bought and sold at market price, not NAV, and are not individually redeemed from the fund. Buying and selling shares generally results in brokerage commissions which will reduce returns. The market price may be higher (premium) or lower (discount) than the Net Asset Value (NAV). The fund’s portfolio may underperform its benchmark and/or other asset classes. The fund’s portfolio may underperform the general equity markets, or other asset classes, with the potential for greater individual security risk, asset class risk, and higher industry concentration risk than more broadly diversified portfolios. The fund may invest in large-cap, mid-cap, and small-cap securities. Investing in small-cap and mid-cap securities may have special risks, including wider variations in earnings and business prospects than larger, more established companies. International investments may involve additional risks, including, but not limited to, currency fluctuation, accounting methods, and geopolitical instability. Emerging markets involve heightened risks related to the same factors as well as increased volatility and potentially lower trading volume. Changes in laws, domestically or abroad, could result in the inability of the fund to operate as described in the prospectus. Narrowly focused investments may be subject to higher volatility.
The Fund's investment manager has contractually agreed to limit expenses until 12/31/2019. Before waiver and reimbursement, the Fund's expenses were 3.38%. After the fee waiver and reimbursement of 1.74%, the Fund's expenses were 1.64%. To view the most recent performance data, visit Arrow Fund's website here.
Past performance is no guarantee of future results. Current performance may be lower or higher than the performance data quoted above. Investment return and principal value will fluctuate, so that shares, when sold or redeemed, may be worth more or less than their original cost. Performance data current to the most recent month-end may be obtained by visiting www.arrowfunds.com or by calling 1-877-277-6933. ETFs are generally bought and sold at market price (not NAV) and are not individually redeemed from the fund. Brokerage fees will reduce returns. Index returns assume reinvestment of distributions, but do not include fees or expenses. Indexes are not available for direct investment. Market returns are based upon the midpoint of the bid/ask spread at market close when NAV is determined, and do not represent the returns you would receive if you traded shares at other times. The market price may be above (premium) or below (discount) relative to the NAV. *DOGS inception date: 1/2/2018. The AI Dogs of the World ex-USA Index (“AI DOGS”) selection methodology consists of long positions in the equity markets of foreign countries exhibiting weaker momentum characteristics among the foreign universe for the possibility of a mean reversion opportunity, or a move in equity market prices and returns back to its historical average. Index returns assume reinvestment of dividends, but do not reflect any management fees, transaction costs or expenses. Indexes are unmanaged and are not available for direct investment. Arrow Insights, a division of Arrow Investment Advisors, LLC, is the index provider.
Before investing, please read the prospectus and shareholder reports to learn about the investment strategy and potential risks. Investing involves risks, including the potential for loss of principal. An investor should consider the fund’s investment objective, charges, expenses and risks carefully before investing. This and other information about the fund is contained in the fund’s prospectus, which can be obtained by calling 1-877-277-6933. Content reviewed by an affiliate, Archer Distributors, LLC.
