Securities Arbitration Lawyers BlogCatalyst Hedged Futures Strategy Fund (HFXIX) Under Investigation Over Recent Drop in Value and Misclassification
Silver Law Group is investigating Catalyst Capital Advisors LLC (CRD# 139895/ SEC# 801-66886) (“Catalyst”) and one of its mutual funds, Catalyst Hedged Futures Strategy Fund Class I (“HFXIX”) after the fund lost approximately 30 percent of its value in the span of three months.
HFXIX is a fund that seeks to provide positive returns in all market conditions with low volatility and low correlation to the equity markets by investing in option strategies on equity index futures contracts, according to the fund’s fact sheet. The fund primarily invests in long and short call and put options on U.S. Stock Index Futures contracts, and lists the primary reason for investing as capital appreciation and preservation.
The fund has performed well relative to other managed futures funds, which fell 2.8 percent. But according to an InvestmentNews report, the fund is actually an options writing fund, which opens up arguments of misclassification against Catalyst.