Trilogy Alternative Return Fund February 2020 Commentary

February 2020 turned out to be wildly volatile for financial markets. Both International and Domestic equity markets were bound by fear of a Coronavirus pandemic and this created unease about investing in global equity markets. Money moved swiftly out of those holdings and into traditionally safe-haven investments such as U.S. Treasuries.

The S&P 500 Total Return Index finished the month -8.23%; while the Bloomberg Barclays U.S. Aggregate Total Return Bond Index was +1.80% as investors piled into bonds causing rates to drop.

Digging into Trilogy's monthly returns, we saw the dividend paying equities of the strategy fall with U.S. equities. While the equities lost in value, the S&P 500 based collar that we employ helped to dampen that blow and covered nearly half of the losses from our equities. The contribution effect of this portion of the fund was -2.79%

Both sides of the option income portion of the fund did very well considering the huge move for equity markets during the month. Fixed Income provided a buffer as rates fell and our fixed income participated in that rally. Usually when markets move a great deal over a given month our short option strategy suffers some losses but, given our ability to purchase options back mid-month, we were able to see gains in this portion as well. The contribution effect of this portion of the fund was .75%.

The market movement portion of the fund was the real star of the month as puts that we own for risk mitigation really gained in value during the late month sell-off in equities. These puts are employed to help lessen the impact on the fund in the case of a large downward movement for equities The contribution effect of this portion of the fund was 2.80%.

To view the most recent performance for the Stadion Trilogy Alternative Return Fund, click here.

Past performance is no guarantee of future results. Investments are subject to risk and any of Stadion’s investment strategies may lose money. The investment strategies presented are not appropriate for every investor and financial advisors should review the terms and conditions and risks involved. Stadion’s actively managed portfolios may underperform during bull markets. Some information contained herein was prepared by or obtained from sources Stadion believes to be reliable. There is no assurance that any of the target prices or other forward-looking statements mentioned will be attained. Any market prices are only indications of market values and are subject to change.

The S&P 500 Total Return Index is an unmanaged index of 500 common stocks chosen for market size, liquidity and industry group representation. It is a market-value weighted index. As a total return index, it assumes reinvestment of all cash distributions.

Bloomberg Barclays Capital U.S. Aggregate Total Return Bond Index is an unmanaged index of prices of U.S. dollar-denominated investment-grade fixed income securities with remaining maturities of one year and longer.

A short, or short position, is selling first and then buying later. The trader's expectation is that the price will drop; the price they sell at is higher than the price they buy it at later. The difference between the sale price and the buy price produces a profit or loss.

A short option strategy is a short position in which the tradeable interests are options.

A put is an option which conveys the right to sell something at a specific price

A collar is an option strategy that limits the range of possible positive or negative returns on an underlying security to a specific range.

One cannot invest directly in an index.

The Report’s commentary, analysis, opinions, advice, and recommendations represent the personal and subjective views of the author and are subject to change at any time without notice.


There are additional costs and potential risks associated with investing in domestic and international Exchange Traded Funds (ETFs). Investment in the Fund is subjective to investment risks, including, without limitation, market risk, management style risk, risks related to “fund of funds” structure sector risk, fixed income risk, tracking risk, risks related to ETF net asset value and market price, foreign securities risk, risks related to portfolio turnover and small capitalization companies’ risk. Since each Stadion fund is a “fund of funds”, an investor will indirectly bear fees and expenses charged by the underlying ETFs and investment companies in which a Stadion Fund invests in addition to a Stadion Fund’s direct fees and expenses. More information about these risks and other risks can be found in the Fund’s prospectus.

There are risks associated with the potential investment of the Fund’s assets in fixed income investments which include credit risk, interest rate risk, and maturity risk among others. These risks could affect the value of investments of the Fund, possibly causing the Fund’s share price and total return to be reduced and fluctuate more than other types of investments. Additional information about fixed income risks can be found in the Fund’s statement of additional information (“SAI”). Investment Objective: Seek long-term capital appreciation.

The Fund’s foreign investments generally carry more risks than funds that invest strictly in U.S. Assets including currency risk, geographic risk, and emerging market risk. Risks can also result from varying stages of economic and political development, differing regulatory environments’ trading days and accounting standards, and higher transaction costs of non-U.S. markets.


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The Stadion Funds are distributed by ALPS Distributors, Inc. An investment in the Funds involves risk, including loss of principal.