Preferred securities are subject to bond market volatility risk, credit risk and interest rate fluctuation risk. In addition, preferred securities are subordinated to other securities in the issuer’s capital structure and are subject to the risk that the issuer will fail to make dividends or other distributions because other claims on the issuer’s assets take priority. Preferred securities may be less liquid than many other types of securities and may be subject to the risk of being redeemed prior to their scheduled date.
The Fund’s investments in closed-end funds generally reflect the risks of the underlying securities they hold. The Fund will indirectly bear its proportionate share of the management and other expenses that are charged by the closed-end funds, in addition to the expenses paid by the Fund. Shares of closed-end funds are subject to other risks related to their structure, including the possibility that shares may trade at a discount from their net asset value and the use of leverage in their capital structure. The presence of leverage in the closed-end fund structure introduces both increased volatility of net asset value, and the potential for greater variability in the dividends paid by the closed-end funds.
The Global Dividend Stock Sleeve employs a disciplined strategy and will not deviate from this strategy (except to the extent necessary to comply with federal tax laws or other applicable laws). If the Global Dividend Stock Sleeve is committed to a strategy that is unsuccessful, the Fund will not meet its investment goal. Because the Global Dividend Stock Sleeve generally will not use certain hedging techniques available to the Preferred and Closed-End Fund Sleeves to reduce stock market exposure, this portion of the Fund may be more susceptible to general market declines than the other sleeves. International investing involves special risks, such as currency fluctuations and economic and political instability. Securities of small and medium sized companies are usually more volatile and entail greater risks than securities of large companies.