130/30 Enhanced Equity

Investment Objective
Sage 130/30 enhanced equity management product is a maximum 30% short and 130% long extension strategy focused on asset class segments using exchange-traded funds and other indexed investment products rather than individual securities.

The strategy utilizes Sage’s equity market segment ranking system to objectively rank the relative attractiveness of equity market segments across all market caps and styles.

The portfolio is implemented by favoring the highest ranked segments and, if desired, shorting our least favored segments to increase the potential for alpha generation. Additionally, up to 30% may be invested in non-core equity segments such as commodities, emerging markets and REITS to offer excess return opportunities, diversification benefits and downside protection in weak core equity market environments.

The strategy is executed primarily using exchange-traded funds (ETFs), but will also utilize ETF and index options to further control risk, facilitate leverage or add incremental excess return in range-bound market environments.

Investment Process Our investment process follows a quantitatively driven disciplined approach designed to offer potential excess return from three steps:

• The application of Sage's time-test segment rotation model used in our core equity product to overweight attractive and short the least attractive segments of the core equity market to generate returns over broad market. Our quantitative models focus on weighing the excess return potential in the next 3-6 months based on both the macro environment and fundamental factors.

• The tactical addition off indexed alternative asset class exposure based on valuations and fundamental attractiveness to the core equity markets

• The application of ETF and index options to further control risk, facilitate leverage or add incremental return in range-bound market environments.

Benchmark
Standard & Poor 500 Index/Russell 3000 Index