Navigator Equity Hedged Fund adds volatility-linked investments

By Toni Weeks

San Diego, Dec. 7 - The Navigator Equity Hedged Fund has expanded the types of securities it will use to hedge equity market risk, adding both volatility-linked exchange-traded funds and volatility-linked exchange-traded notes, according to a 497 filing with the Securities and Exchange Commission.

The fund will continue to invest in ETFs that invest primarily in equity securities as well as, for hedging purposes, put options on the S&P 500 index.

The fund's adviser, Philadelphia-based Clark Capital Management Group, Inc., applies a hedging strategy to protect the portfolio against significant market declines. In the case of volatility-related hedging, the fund purchases ETFs and/or ETNs that invest in instruments linked to equity market volatility of the Chicago Board Options Exchange Volatility Index (VIX) Futures to benefit from the expected negative correlation between volatility and equity returns.

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