Ticker: 
PFRNX
  |  CUSIP: 
707269700
AS OF 

Penn Capital Floating Rate Income Fund (formerly, Penn Capital Defensive Floating Rate Income Fund)

Nav Daily $ Change Daily % Change Year To Date Inception Date Share Class
$9.66
-$0.02
-0.21%
2.51%
Institutional

Overview

The Floating Rate Income Fund seeks to provide high current income and benefit from actual or expected rising rates.

Differentiated profile characteristics of the Floating Rate Income Fund:

  • Focus on Single-B and above credit quality rated loans with emphasis on first-lien loans with strong covenants
  • Downside sell discipline with detailed covenant review, including change of control
  • Identify relative value opportunities and upgrade candidates

Objective

The objective of the Penn Capital Floating Rate Income Fund seeks to provide current income.

Strategy

The Fund seeks to achieve its objective by investing, under normal circumstances, at least 80% of its net assets in floating rate senior secured loans, floating rate senior corporate debt and other floating rate senior instruments.

Investment Type Examples

Bank loans, bonds, debt securities and other similar instruments issued by various domestic and foreign entities.

Industry Examples

Consumer Staples, Financials, Food, Beverage & Tobacco, Healthcare, Lodging & Leisure, Metals and Mining, Packaging, Technology, and Services.

Performance

AS OF 10/31/2021
Ticker: PFRNX | CUSIP: 707269700
MTD QTD YTD 1 Year 3 Year 5 Year 10 Year Since Inception
Penn Capital Floating Rate Income Fund
0.25%
0.25%
2.72%
5.34%
2.83%
3.32%
n/a
3.60%
S&P-LSTA BB Ratings Loan Index
0.23%
0.23%
2.66%
5.52%
2.97%
3.31%
n/a
3.77%
S&P-LSTA BB/B Ratings Loan Index
0.30%
0.30%
4.15%
7.58%
4.19%
4.32%
n/a
4.82%
AS OF 10/31/2021
Ticker: PFRNX | CUSIP: 707269700
Penn Capital Floating Rate Income Fund
MTD 0.25
QTD 0.25
YTD 2.72
1 Year 5.34
3 Year 2.83
5 Year 3.32
10 Year n/a
Since Inception
3.60
S&P-LSTA BB Ratings Loan Index
MTD 0.23
QTD 0.23
YTD 2.66
1 Year 5.52
3 Year 2.97
5 Year 3.31
10 Year n/a
Since Inception
3.77
S&P-LSTA BB/B Ratings Loan Index
MTD 0.30
QTD 0.30
YTD 4.15
1 Year 7.58
3 Year 4.19
5 Year 4.32
10 Year n/a
Since Inception
4.82

Investment Process

Step 1
Economic Outlook

Penn Capital’s team determines industries with potential relative value: the economic cycle, business environment, industry/sector analysis, and interest rates.

Step 2
Quantitative Screening

Penn Capital’s analysts and portfolio managers screen industries for companies with higher spreads to treasury relative to: comparable companies, industry averages, and historical averages.

Step 3
Other Proprietary Sources

Penn Capital’s analysts and portfolio managers source ideas from leveraging Penn Capital's equity relationships: equity investment styles & conferences, IPO & competitive intelligence, management meetings and road shows, industry experts, ex-government officials.

Step 4
Improving Fundamentals

Penn Capital's analysts and portfolio managers further screen for companies with improving financial metrics such as Debt/EBITDA, EBITDA/interest expense, free cash flow/debt.

Step 5
Liquidity Outlook

Penn Capital's analysts and portfolio managers screen for liquidity issues and perform research such as covenant analysis, bank loan availability, and asset value analysis.

Step 6
Qualitative Research

Penn Capital's analysts and portfolio managers then perform qualitative research such as company management, strong fundamentals, positive catalysts, suppliers/customers /competitors, and industry experts.

Step 7
Penn Capital Risk Rating (PRR)

Primary and secondary analysts and portfolio managers assign the proprietary Penn Capital Risk Rating (PRR) which includes forward looking estimates of credit quality, quantitative/qualitative factors, and rating agencies static.

Step 8
Team Review and Approval

The investment team consists of all portfolio managers and analysts; daily team meetings are primary forums for discussion and a consensus at team level is required prior to moving a recommendation on to High Yield Credit Committee.

Step 9
High Yield Credit Committee Approval*

Committee confirms PRR and relative value: review of ideas approved by investment team, considers impact of credit on portfolio construction

*After Step 9, an idea is either approved for portfolio inclusion or dismissed to company watch list with further due diligence required

Fees & Expenses

Total Fund annual net operating expenses (after fee waiver/expense reimbursement) are: Institutional Class 0.64%.

Total Fund annual gross operating expenses (before fee waiver/expense reimbursement) are: Institutional Class 1.16%.

The Fund's advisor has contractually agreed to waive its fees and/or pay for operating expenses of the Fund to ensure that total annual fund operating expenses do not exceed 0.64% for the Institutional Class shares of the Fund. This agreement is in effect until April 1, 2023. The Fund’s advisor is permitted to seek reimbursement from the Fund of fees waived for a period of three years from the date of the waiver or payment to the extent it does exceed the expenses limits.

Portfolio Managers

David Jackson, CFA

Senior Portfolio Manager, Senior Partner

Mr. Jackson began his career with Penn Capital in 2008. Mr. Jackson chairs the Credit Risk Committee and serves as a Portfolio Manager for Penn Capital’s Defensive Floating Rate Income and Opportunistic High Yield strategies. Prior to joining Penn Capital, Mr. Jackson was an Associate Director with the Financial Institutions Group at Fitch Ratings in New York City, where he assisted with rating coverage of the specialty finance sector. He also gained experience working for the Federal Reserve Bank of Philadelphia on the bank supervision and regulation team. He received a BS in Finance from Rutgers University School of Business.