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Destra Dividend Total Return Fund

A Shares

  • ticker: DHDAX
  • cusip: 250 64R 845

    I Shares

    • ticker: DHDIX
    • cusip: 250 64R 811

C Shares

  • ticker: DHDCX
  • cusip: 250 64R 837

Portfolio Managers

Hilton Capital Management

Hilton Capital Management is committed to delivering solid performance to our clients with an emphasis on reducing downside volatility. HCM follows a unique process that principally focuses on income generation as a key component to competitive total returns while keeping focused on minimizing risk and volatility.

Investment Team

William J. Garvey
Chief Investment Officer

Alexander D. Oxenham, CFA
Partner & Senior Portfolio Manager

C. Craig O’Neill
CEO & President

Investment Objective

To seek long-term total return and current income.

Investment Strategy and Philosophy

The Fund seeks to achieve its investment objective by investing primarily in a diversified portfolio of equity securities. Under normal circumstances, the Fund will invest at least 80% of its net assets in dividend producing equity securities. The Fund may invest in securities of companies with any market capitalization. Equity securities held by the Fund may include common stocks, preferred shares, convertible securities and securities or other instruments whose price is linked to the value of common stock, depository receipts and securities of master limited partnerships (“MLPs”).

The Fund may invest in U.S. dollar-denominated securities of U.S. and foreign issuers, and up to 20% of its total assets may be invested in securities denominated in non-U.S. dollar currencies. The Fund may invest in securities from any country.

Investment Process

The Fund’s sub-adviser, Hilton Capital Management, LLC (the “Sub-Adviser”), believes that financially strong stocks with rising dividends off er the prospects of consistent performance as well as potential added value. Stock prices fluctuate, but dividends add current returns and, over time, increases in dividends can induce increases in the price of the stocks generating those dividends. The Sub-Adviser’s research shows that dividends can be large contributors to total returns, and that by focusing on companies with a consistent track record of increasing their dividends, investors have an opportunity to generate superior risk-adjusted performance over time.

The Sub-Adviser’s goal is to provide for annual increases in income that exceed the rate of inflation over time. Its investment process starts by identifying, selecting and investigating stocks that pass initial quantitative screens for quality, yield and growth of yield. Preference is given to companies with monopoly like characteristics and recurring revenues, which may be attained through proprietary goods and services, strategic geographic positioning, or market dominance. The Sub-Adviser seeks companies that fulfill society’s basic requirements as well as companies with a unique potential or “growth kicker” – such as new products, hidden assets, or industry conditions – which is not currently reflected in the stock price. Candidates are then ranked according to yield, growth of yield, special growth potentials and contribution to overall diversification of the portfolio.

Performance

Quarterly

as of 3/31/17

ticker share class 3 MO YTD 1YR 3YR 5YR from
incep.
distribution
DHDAX1 A at NAV 2.22 2.22 11.01 2.33 6.82 9.22 quarterly
DHDAX A -2.36 -2.36 6.00 0.77 5.84 8.33 quarterly
DHDIX I 2.32 2.32 11.32 2.66 7.17 9.59 quarterly
DHDCX C 0.99 0.99 9.16 1.58 6.03 6.79 quarterly
Index2

6.07 6.07 17.17 10.37 13.30 15.69

Monthly

as of 3/31/17

ticker share class 3 MO YTD 1YR 3YR 5YR from
incep.
distribution
DHDAX1 A at NAV 2.22 2.22 11.01 2.33 6.82 9.22 quarterly
DHDAX A -2.36 -2.36 6.00 0.77 5.84 8.33 quarterly
DHDIX I 2.32 2.32 11.32 2.66 7.17 9.59 quarterly
DHDCX C 0.99 0.99 9.16 1.58 6.03 6.79 quarterly
Index2

6.07 6.07 17.17 10.37 13.30 15.69

1 At NAV

2 The S&P 500 Index (see glossary below for definition).

Class A shares performance reflects the deduction of the maximum sales charge of 5.75%

Included in the each Fund’s Class A shares expenses is a distribution and service (12b-1) fee of 0.25%.

Class C shares have a maximum contingent deferred sales charge (CDSC) of 1%. However, w/CDSC performance for Class C shares reflects the deduction of 1% for all shares redeemed within 12 months of purchase.

Included in the each Fund’s Class C shares expenses is a distribution and service (12b-1) fee of 1.00%.

Data presented reflects past performance, which is no guarantee of future results. Investment results and principal value will fluctuate so that shares, when redeemed, may be worth more or less than their original cost. Due to market volatility, current performance may be higher or lower than the performance shown. Performance shown for Class A Shares with load includes the Fund’s maximum sales charge of 4.50%. Returns for period of less than one year are not annualized, and include reinvestment of all distributions.

The Adviser has agreed to cap expenses such that the total annual fund operating expenses, excluding brokerage commissions and other trading expenses, taxes, acquired fund fees and other extraordinary expenses (such as litigation and other expenses not incurred in the ordinary course of business) at 1.76% for Class A, 2.51% for Class C and 1.48% for Class I. This waiver will continue in effect until February 1, 2022. The waiver may be terminated or modified prior to February 1, 2022 only with the approval of the Board of Trustees of the Trust. The gross expenses for the Class A, Class C and Class I shares are 2.36%, 2.61% and 1.57% respectively. Class A and C shares have a 12b-1 fee of 0.25% and distribution fee of up to 0.75% for Class C Shares. A contingent deferred sales charge of 1.00% applies on Class C shares redeemed within 12 months of purchase.

Standardized Yield

as of 3/31/17

A Share Class DHDAX 2.51 %
I Share Class DHDIX 2.87 %
C Share Class DHDCX 1.84 %

This yield reflects the theoretical income that a portfolio would generate including dividends and interest, during the period after deducting a fund’s expenses. A fund’s actual net earnings for a given period under generally accepted accounting principals may differ from this standardized yield.

There is a contractual/voluntary fee waiver currently in place for this Fund through February 1, 2022. Had that subsidy not been in place the Fund's standardized yields would have been 2.00% for A shares, 2.33% for I shares and 1.35% for C shares.

Portfolio Characteristics

as of 12/31/16

The Fund S&P 500 Index
Number of Holdings: 52 505
Average Market Cap $22.4 bil $40.0 bil
Price to Earning: Trailing Operating 22.3x 24.3x
Price to Book 3.4x 2.8x

Sector Breakdown

as of 12/31/16

Top 10 Holdings

as of 12/31/16

iShares Interm Government/Credit Bd 7.61%
BlackRock Liquidity FedFund Instl
4.61%
Invesco Dynamic Credit Opps 2.56%
iShares 0-5 Year High Yield Corp Bd 2.53%
Hci Grp Cv 3.875% 2019-03-15 2.48%
Republic Services Inc Class A 2.35%
Constellation Brands Inc A 2.34%
Redwood Trust Inc 2.29%
Vector Group Ltd 2.22%
Broadridge Financial Solutions Inc 2.21%

Holdings are subject to change without notice. There is no assurance that the investment process will lead to successful investing.

All compositions are subject to daily changes with market actions.

Literature

Glossary

Price/Earnings (trailing): A valuation ratio of a company’s current share price compared to its per-share earnings over the previous four quarters.

Price/Book: A ratio used to compare a stock’s market value to its book value. It is calculated by dividing the current closing price of the stock by the latest quarter’s book value per share.

Average Market Capital: The average of market capitalization (market price multiplied by the number of shares outstanding) of the stocks in a portfolio.

The S&P 500 Index is a commonly recognized market-capitalization-weighted index of 500 widely held equity securities, designed to measure broad U. S. equity performance.

Risks

The Fund seeks to achieve its investment objective by investing primarily in a diversified portfolio of equity securities. Under normal circumstances, the Fund will invest at least 80% of its net assets in dividend-producing equity securities. The Fund may invest in securities of companies with any market capitalization. Equity securities held by the Fund may include common stocks, preferred shares, convertible securities and securities or other instruments whose price is linked to the value of common stock, depository receipts, and securities of master limited partnerships (“MLPs”).

The Fund may invest in U.S. dollar-denominated securities of U.S. and foreign issuers, and up to 20% of its total assets in securities denominated in non-U.S. dollar currencies. The Fund may invest in securities from any country.

Some important risks of the Fund are: Dividend Income Risk: Companies that issue dividend yielding equity securities are not required to continue to pay dividends on such stock. Therefore, there is the possibility that such companies could reduce or eliminate the payment of dividends in the future. In such an event, the yield on the Fund’s dividend paying equity securities would be adversely affected. Depending upon market conditions, income producing equities that meet the Fund’s investment criteria may not be widely available and/or may be highly concentrated in only a few market sectors. This may limit the ability of the Fund to achieve its investment objective. Energy Companies Risk: The Fund invests in energy companies, including pipeline and gas distribution companies. General problems of energy companies include volatile fluctuations in price and supply of energy fuels, international politics, terrorist attacks, reduced demand as a result of increases in energy efficiency and energy conservation, the success of exploration projects, clean-up and litigation costs relating to oil spills and environmental damage, and tax and other regulatory policies of various governments. Natural disasters such as hurricanes in the Gulf of Mexico will also impact energy companies. Oil production and refining companies are subject to extensive federal, state and local environmental laws and regulations regarding air emissions and the disposal of hazardous materials. In addition, recently oil prices have been extremely volatile. Master Limited Partnership Risk and Sector Risk: An investment in units of master limited partnerships (“MLPs”) involves certain risks which differ from an investment in the securities of a corporation. Holders of MLP units have limited control and voting rights on matters affecting the partnership. In addition, there are certain tax risks associated with an investment in MLP units and the potential for conflicts of interest exist between common unit holders and the general partner, including those arising from incentive distribution payments. The benefit the Fund derives from investment in MLP units is largely dependent on the MLPs being treated as partnerships and not as corporations for federal income tax purposes. If an MLP were classified as a corporation for federal income tax purposes, there would be reduction in the after-tax return to the Fund of distributions from the MLP, likely causing a reduction in the value of the Fund’s shares. MLP entities are typically focused in the energy, natural resources and real estate sectors of the economy. A downturn in the energy, natural resources or real estate sectors of the economy could have an adverse impact on the Fund. At times, the performance of securities of companies in the energy, natural resources and real estate sectors of the economy may lag the performance of other sectors or the broader market as a whole.

Investors should consider the investment objectives and policies, risk considerations, charges, and ongoing expenses of an investment carefully before investing. The prospectus contains this and other information relevant to an investment in the Fund. Please read the prospectus carefully before you invest or send money. To obtain a prospectus, please contact your investment representative or Destra Capital Investments LLC or download a PDF here.

Risk is inherent in all investing. The value of your investment in the Fund, as well as the amount of return you receive on your investment, may fluctuate significantly from day to day and over time. You may lose part or all of your investment in the Fund or your investment may not perform as well as other similar investments. The risks of the Fund will result from both the Fund’s direct investments and its indirect investments made through the Subsidiary. Accordingly, the risks that result from the Subsidiary’s activities will be described herein as the Fund’s risks.