Donoghue Forlines Dividend VIT Fund
Fund Goal
The Donoghue Forlines Dividend VIT Fund’s primary investment objective is total return from dividend income and capital appreciation. Capital Preservation is a secondary objective of the Fund.
Potential Benefits
- Dividend Yield
- Sector Diversification
- Equal Weighting
- Quarterly Rebalancing
- Quarterly Reconstitution
- Tactical Overlays
There is no guarantee that any investment strategy will achieve its objectives, generate profits or avoid losses.
Index Selection Process
Universe of 1000 Large to Mid-Cap Value Stocks
High Dividend Paying Stocks with Sector Neutral Exposure
Quality Oriented Screens
50 Stocks Equal Weighted
50% Shorter Term Exponential Moving Average Crossovers
50% Longer Term Exponential Moving Average Crossovers
100% Stocks or 50%
100% Defensive Position
Performance as of 9/30/2024
| Fund Name | Dividened VIT (Class 1 Shares) |
Russell 1000 Value |
|---|---|---|
| YTD | 15.61% | 21.18% |
| 1Y | 23.60% | 35.68% |
| 3Y | 3.75% | 10.83% |
| 5Y | 3.75% | 15.64% |
| 10Y | 1.73% | 13.10% |
| Since Inception (06/02/2007) |
1.73% | 10.18% |
The performance data quoted here represents past performance. Current performance may be lower or higher than the performance data quoted above. Past performance is no guarantee of future results. The investment return and principal value of an investment will fluctuate so that investor’s shares, when redeemed, may be worth more or less than their original cost. For performance information current to the most recent month-end, please call toll-free 877-779-7462.
The fund is an investment vehicle for variable annuity contracts and may be subject to fees or expenses that are typically charged by these contracts. Please review the insurance contract prospectus for further description of these fees and expenses. This product is available as a sub-account investment to a variable life insurance policy only and is not offered directly to the general public. The below table describes the annual operating expenses that you pay indirectly if you invest in the Fund through your retirement plan or if you allocate your insurance contract premiums or payments to the Fund. However, each insurance contract and separate account involves fees and expenses that are not described here. If the fees and expenses of your insurance contract or separate account were included in this table, your overall expenses would be higher. You should review the insurance contract prospectus for a complete description of fees and expenses.
Annual Operating Expenses
(expenses that you pay each year as a percentage of the value of your investment)
| Expense | Class 1 Shares |
|---|---|
| Management Fees | 1.00% |
| Distribution & Shareholder Service (12b-1) Fees | 0.25% |
| Other Expenses | 1.43% |
| Acquired Fund Fees & Expenses | 0.02% |
| Total Annual Fund Operating Expenses | 2.70% |
| Fee Waiver and/or Expense Reimbursement | (0.68%) |
| Total Annual Fund Operating Expenses After Fee Waiver and/or Expense Reimbursment (contractually through October 31, 2024) |
2.02% |
Index Selection Process Details
The Fund’s investment adviser seeks to achieve the Fund’s investment objectives by seeking to track the FCF Risk Managed Sector Neutral Dividend Index (the “Dividend Index”) that provides a formulaic methodology for allocating investment between securities of issuers who demonstrate higher free cash flow and dividend yield and short-term treasuries (maturity of 1 to 3 years).
The methodology of the Dividend Index is designed to convey the benefits of high free cash flow and dividend yield, sector diversification and equal weighting. In seeking to track the Dividend Index, the adviser buys equity securities in the Fund as described below when the index’s indicators are positive and sells them when its indicators are significantly negative. As described below, the Fund will invest in as many as 50 equity securities. The Dividend Index is reconstituted and rebalanced quarterly during March, June, September, and December.
The Dividend Index establishes an equity portfolio consisting of up to 50 equity securities based on a combined profitability rank (measured by free cash flow over total equity) and dividend yield rank (measured by dividend over market capitalization) from the constituents of the Russell 1000 Value Index and a U.S. Treasury portfolio consisting of short-term treasury ETFs. Free cash flow is the amount of cash a company produces after paying for operating and capital expenses. Only companies with positive free cash flow, payment of cash dividends for the previous four consecutive quarters, and meeting an average daily traded volume minimum over the previous six months are eligible for inclusion in the Dividend Index. Upon selection each security will receive an equal weighting with sector weightings based on the current FactSet RBICS sector weights of the Russell 1000 Value Index. If there are not enough eligible securities within a sector, inclusion will be stopped for that sector at the number of eligible securities. The Dividend Index then applies the Adviser’s defensive tactical overlays as described above.
Investment Committee
John A. Forlines, III • Jeffrey R. Thompson • Richard E. Molari • Nick Lobley
Investment Advisor to the Fund
Donoghue Forlines LLC is a tactical investment firm that has specialized in risk-managed portfolios since 1986. Our tactical strategies are based upon rigorous analysis of decades of historical data. The Donoghue Forlines Funds utilize technical indicators to recognize shifts in market momentum and uses proprietary tactical signals to help mitigate losses in down trending markets and potentially offer strong client-centric riskadjusted returns over a full market cycle.
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