These numbers do not include regular December income dividend distributions or required annual income dividend distributions. You can also refer to our Capital Gains FAQ below to learn more about capital gains distributions and how they affect your account.

Sierra Mutual Funds – Final Capital Gains Distributions
December 2016

  Short-term
Capital Gains
Long-term
Capital Gains
Total Record Date Ex-Date Pay Date
Fund            
Sierra Core Retirement Fund $ 0.000 $ 0.000 $ 0.000 - - -
Sierra Strategic Income Fund $ 0.000 $ 0.000 $ 0.000 - - -

If you have additional questions, please contact Sierra Mutual Funds directly.


Past performance is no guarantee of future results. There is no assurance that fund will continue to make distributions.

7976-NLD-12/2/2016

CAPITAL GAINS FAQ

What is a capital gain?

When an investor sells a capital asset — such as a stock or a bond — for more than the amount paid for it, the investor makes a profit, or capital gain. For example, if a stock is bought for $100 and later sold for $120, the investor’s capital gain is $20.

When a fund sells securities at a profit, the sale also creates a capital gain. Two types of capital gains are realized by our funds — short-term and long-term.

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Why do mutual funds pay capital gain distributions?

When mutual funds sell securities, they typically realize gains or losses. If gains exceed losses, most funds distribute substantially all of their net gains to their investors before the end of the calendar year to satisfy federal excise tax rules. These distributions, which typically occur once or twice a year, are made primarily for tax reasons.

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Why aren’t the Sierra Mutual Funds paying capital gains distributions this year?

The Sierra Mutual Funds are not paying capital gains distributions. The managers of the funds are extremely tax-aware - buys and sells are managed in order to minimize, or in this case of 2016, eliminate any capital gains distributions for investors in the funds.

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Why do the fund’s share price drop when a capital gain distribution is paid?

When gains from sales of securities outweigh losses, they accumulate and contribute to the rise of the net asset value (NAV) of the fund’s shares. When that gain is paid out to investors, its NAV, or share price, is reduced by the amount of the distribution.

Example: Say a fund share sells at an NAV of $10. If sales of the fund’s securities have resulted in the fund making a capital gain distribution of $2 a share during the year, $2 will be paid to investors on the fund’s payment date. The fund share price will decline to $8 on the record date as a result of the distribution.

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What is the record date?

The record date is the date when investors in a particular fund are entitled to receive a fund distribution.

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What is the ex-date?

The ex-date is the date on which the seller, and not the buyer, of a fund will be entitled to a recently announced distribution.

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What is the pay date?

The pay date is the date on which a declared distribution is scheduled to be paid.

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When do investors have to pay taxes on their capital gain distributions?

Investors are required to include these amounts on their federal and state, if applicable, income tax returns. This is true even if they reinvested their capital gain distributions or if the fund’s share price declined during the year.

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