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Alpha Hedged Strategies Fund

Standardized Performance

Class Ticker Day %YTD %1 Yr %2 Yrs %3 Yrs %5 Yrs %Since
Inception %
Exp. Ratio
Net %/Gross %
Class NL ALPHX -0.380.29-2.422.375.79-2.652.213.99 / 4.82
Class A (w/o sales charge) APHAX -0.280.38-2.422.375.79-2.652.213.99 / 4.82
Class A (w/ sales charge) APHAX -5.06-4.37-7.080.164.27-3.501.75-
Class C APHCX -0.290.10-3.121.544.96-3.41-1.554.74 / 5.57
Class I ALPIX -0.280.76-1.413.426.87-1.673.232.99 / 3.82
Class Ticker Mth%YTD %1 Yr %2 Yrs %3 Yrs %5 Yrs %Since
Inception %
Exp. Ratio
Net %/Gross %
Class NL ALPHX -0.832.19-0.932.187.57-2.052.423.99 / 4.82
Class A (w/o sales charge) APHAX -0.832.29-0.932.187.57-2.052.423.99 / 4.82
Class A (w/ sales charge) APHAX -5.56-2.55-5.14-0.036.01-2.901.96-
Class C APHCX -0.951.95-1.791.316.68-2.82-1.254.74 / 5.57
Class I ALPIX -0.832.570.043.208.64-1.073.442.99 / 3.82
HFRI Fund of Funds Composite Index - -0.263.10-4.820.204.13-1.103.75-
Class Ticker Qtr %YTD %1 Yr %2 Yrs %3 Yrs %5 Yrs %Since
Inception %
Exp. Ratio
Net %/Gross %
Class NL ALPHX 3.053.050.183.019.53-1.652.533.99 / 4.82
Class A (w/o sales charge) APHAX 3.153.150.183.019.53-1.652.533.99 / 4.82
Class A (w/ sales charge) APHAX -1.73-1.73-4.090.817.95-2.502.07-
Class C APHCX 2.932.93-0.572.158.64-2.42-1.104.74 / 5.57
Class I ALPIX 3.433.431.244.0810.65-0.653.562.99 / 3.82
HFRI Fund of Funds Composite Index - 3.363.36-3.410.784.59-0.713.82-

Average Annual Total Returns. Periods less than 1 year are not annualized.
Inception date: ALPHX 09/23/2002; APHAX 05/02/2011; APHCX 08/01/2006; ALPIX 09/30/2011, HFRI FoF Index 09/30/2002. Since Inception performance for Class A and Class I are since 09/23/2002.

Growth of $10,0001

10000
10321.577
10508.29949
10995.85096
10892.1161
10829.87528
11031.3846
11042.40496
11086.48624
11251.79129
11339.9547
10921.18038
10777.91524
10877.09901
10788.93577
11042.40456
11218.73078
11218.73078
11532.16529
11719.9493
11896.68731
11918.77945
11951.91843
11940.87247
11885.64235
11863.5505
11543.2121
11355.42828
11499.02789
11454.84288
11586.12912
11751.96139
11862.51561
11939.90429
11840.8
10000
10153.64288
10264.75942
10443.07483
10433.73157
10516.94782
10596.64865
10557.57515
10571.38116
10746.3667
10843.11142
10561.68113
10468.1324
10548.77671
10562.15403
10810.004
10970.08403
10959.35178
11200.99039
11217.30363
11310.85867
11300.10381
11438.13263
11314.33527
11167.15158
11210.5366
10914.90433
10610.55398
10723.93832
10619.04276
10559.5924
10747.84981
10908.28966
10914.61426
10886.4

Historical Data

Historical Data2 Since July, 2009ALPHXHFRI Fund of Funds
Composite Index
S&P 500
TR Index4
Cumulative Return518.41%8.86%61.14%
Standard Deviation65.694.5915.89
Correlation (vs. S&P 500 TR Index)70.770.84--
Annualized Alpha (vs. S&P 500 TR Index)81.10-1.32--
Beta (vs. S&P 500 TR Index)90.280.24--
Sharpe Ratio101.080.681.14
Sortino Ratio111.890.981.94
Downside Deviation123.163.068.72

Up Capture and Down Capture vs HFRI Fund of Funds Composite Index

  Up Capture Down Capture
Hatteras Alpha Hedged Strategies Fund (No Load) 13 141.80% 76.73%

ALPHX vs. HFRI Fund of Funds Composite Index

May-11
Jun-11
Jul-11
Aug-11
Sep-11
Oct-11
Nov-11
Dec-11
Jan-12
Feb-12
Mar-12
Apr-12
-0.09
-0.46
-0.19
-2.70
-1.63
1.26
-0.38
1.15
1.43
0.94
0.65
-0.83
-1.08
-1.30
0.39
-2.64
-2.79
1.07
-0.99
-0.54
1.81
1.58
0.06
-0.26
1Q09
2Q09
3Q09
4Q09
1Q10
2Q10
3Q10
4Q10
1Q11
2Q11
3Q11
4Q11
1Q12
-2.01
10.05
9.96
0.32
2.00
-4.21
2.45
4.44
3.35
-0.28
-4.46
2.03
3.05
0.37
4.81
4.43
1.47
1.41
-2.59
3.27
3.62
0.88
-1.18
-4.98
-0.47
3.36
2003
2004
2005
2006
2007
2008
2009
2010
2011
3.21
17.23
2.80
9.32
8.25
-31.63
18.95
4.54
0.47
11.61
6.86
7.49
10.39
10.25
-21.37
11.47
5.70
-5.72

Monthly Performance for ALPHX

Year Jan % Feb % Mar % Apr % May % Jun % Jul % Aug % Sep % Oct % Nov % Dec % Year %
2012 1.43 0.94 0.65 -0.83 2.19
2011 1.63 1.51 0.19 0.28 -0.09 -0.46 -0.19 -2.70 -1.63 1.26 -0.38 1.15 0.47
2010 0.10 0.40 1.49 0.78 -3.69 -1.31 0.92 -0.81 2.35 1.60 0.00 2.79 4.54
2009 0.00 -3.69 1.74 4.68 5.23 -0.10 3.22 1.81 4.64 -0.94 -0.57 1.86 18.95
2008 -4.59 0.55 -1.49 1.83 1.56 -1.62 -2.50 -2.01 -8.52 -12.35 -6.54 -0.69 -31.63
2007 1.55 0.61 1.37 1.20 2.08 0.15 -1.02 -0.07 2.42 2.08 -2.18 -0.13 8.25
2006 4.29 0.39 1.81 1.70 -1.06 -0.31 -0.77 0.62 -0.77 1.09 0.69 1.38 9.32
2005 -0.25 0.25 -0.17 -1.44 1.72 0.59 1.51 -0.83 1.67 -0.98 0.74 0.01 2.80
2004 0.99 0.10 1.47 -0.87 1.07 5.01 -1.56 2.52 0.82 0.72 5.37 0.60 17.23
2003 2.04 0.00 0.60 -0.20 -0.40 -0.40 -1.41 -0.41 1.02 2.23 0.10 0.04 3.21
2002 - - - - - - - - - -0.90 -1.31 0.10 -2.10

Performance data quoted represents past performance; past performance does not guarantee future results. Net Fund Operating Expenses noted above are contractually capped through April 30, 2013 and exclude dividends on short positions and interest on borrowing as well as other extraordinary items disclosed in the prospectus. The investment return and principal value of an investment will fluctuate so that an investor’s shares, when redeemed, may be worth more or less than their original cost. Current performance of the Funds may be lower or higher than the performance quoted. To obtain current performance information please call 877.569.2382. The average annual returns for Class A Shares “with sales charge” give effect to the deduction of the maximum sales charge of 4.75%. Class C returns do not reflect a 1.00% contingent deferred sales charge which would be applied to shares sold within the first year of purchase and if reflected, would reduce the performance quoted. Class A Shares were not in existence prior to May 2, 2011. Performance for any periods prior to May 2, 2011, is based on the historical performance of the No Load Shares adjusted to assume the expenses associated with Class A Shares. Class I Shares were not in existence prior to September 30, 2011. Performance for any periods prior to September 30, 2011, is based on the historical performance of the No Load Shares adjusted to assume the expenses associated with Class I Shares.

Portfolio composition is subject to change at any time. Class I Shares require a $1MM minimum investment.
All data is as of 4/30/2012, unless otherwise indicated.

Important Disclosures and Risk Factors
Certain hedging techniques and leverage employed in the management of the Fund may accelerate the velocity of possible losses. Short selling involves the risk of potentially unlimited increase in the market value of the security sold short, which could result in potentially unlimited loss for the Funds. Derivatives involve investment exposure that may exceed the original cost and a small investment in derivatives could have a large potential impact on the performance of the Fund. Options held in the Fund may be illiquid and the fund manager may have difficulty closing out a position. Fixed Income instruments are exposed to credit and interest rate risks. Investing in lower-rated (“high-yield”) debt securities involves special risks in addition to the risks associated with investments in higher-rated debt securities, including a high degree of credit risk and liquidity risk. The Fund may also invest in:

  • smaller capitalized companies – subject to more abrupt or erratic market movements than larger, more established companies
  • foreign securities, which involve currency risk, different accounting standards and are subject to political instability;
  • securities limited to resale to qualified institutional investors, which can affect their degree of liquidity;
  • shares of other investment companies that invest in securities and styles similar to the Fund, resulting in a generally higher investment cost than from investing directly in the underlying shares of these funds.

The Fund intends to utilize these individual securities and hedging techniques in matched combinations that are designed to neutralize or offset the individual risks of employing these techniques separately. Some of these matched strategies include merger arbitrage, long/short equity, convertible bond arbitrage and fixed-income arbitrage. There is no assurance that these strategies will protect against losses. The Fund is a non-diversified and therefore may invest in the securities of fewer issuers than diversified funds at any one time; as a result, the gains and losses of a single security may have a greater impact on the Fund’s share price.

Because the Fund is a fund-of-funds, your cost of investing in the Fund will generally be higher than the cost of investing directly in the shares of the mutual funds in which it invests. By investing in the Fund, you will indirectly bear your share of any fees and expenses charged by the underlying funds, in addition to indirectly bearing the principal risks of the funds. Please refer to the summary prospectus or prospectus for more information about the Fund, including risks, fees and expenses.

Mutual fund investing involves risk; loss of principal is possible. Please consult an investment professional for advice regarding your particular circumstances. An investment in the Fund may not be suitable for all investors.

The Fund is offered only to United States residents, and information on this site is intended only for such persons. Nothing on this site should be considered a solicitation to buy or an offer to sell shares of the Fund in any jurisdiction where the offer or solicitation would be unlawful under the securities laws of such jurisdiction.

1

The chart illustrates a hypothetical investment in No Load shares and assumes all distributions have been reinvested. Performance shown is for the period beginning July 1, 2009. Hatteras Funds entered into an agreement to acquire the Fund’s investment advisor in July 2009. As of 4/30/2012.

2

Performance shown is for the period beginning July 1, 2009. Hatteras Funds entered into an agreement to acquire the Fund’s investment advisor in July 2009. As of 4/30/2012

3

The HFRI Fund of Funds Composite Index is an equal weighted index of over 650 constituent hedge fund of funds that invest over a broad range of strategies.

4

Standard & Poor´s (S&P) 500 Total Return Index consists of 500 stocks chosen for market size, liquidity and industry group representation. It is a market value weighted index, with each stock´s weight in the index proportionate to its market value. You cannot invest directly in an index. Benchmark performance should not be considered reflective of Fund performance.

5

Cumulative Return. Returns are net of all expenses of the Fund, including the management fee and incentive allocations, and reflect reinvestment of all distributions, if applicable. Returns do not reflect payment of placement fees, if applicable, which would reduce returns noted above.

6

Standard deviation is a measurement of the investment´s volatility.

7

Correlation is a statistical measure of how two securities move in relation to each other.

8

Alpha measures excess return relative to the market; often referred to as a measurement of “manager skill.”

9

Beta is a measure of a fund´s risk relative to the benchmark.

10

Sharpe ratio measures the risk-adjusted performance. Calculated by subtracting the risk-free rate (90 day U.S. T-bill yield as of the previous year-end) from the rate of return and dividing the result by the standard deviation of returns.

11

Sortino ratio differentiates between good and bad volatility in the Sharpe ratio. Differs from the Sharpe ratio by dividing by downside deviation instead of standard deviation.

12

Downside deviation is a measurement of potential loss that may arise from risk.

13

Performance shown is for the period beginning July 1, 2009. Hatteras Funds entered into an agreement to acquire the Fund’s investment advisor in July 2009. As of 4/30/2012.