Athena Focused Funds

The Athena Focused Funds are some of the most strategy consistent and high conviction US active equity mutual funds available. These mutual funds have outperformed their strategy peers and demonstrate behavioral characteristics that indicate continued success in active equity management.

Methodology

Athena selects funds for inclusion on the Athena Focused Funds list by using a quantitative process based on the Strategy Based Investing framework. Strategy Based Investing groups active equity mutual funds into peer groups composed of funds with similar primary investment strategies.

Funds are then rated based on how consistently the fund manager pursues the stated investment strategy and how convicted the portfolio is constructed. These measures are combined to compute Athena’s Diamond Ratings. Five Diamond funds are the most consistent and have the most conviction, while One Diamond funds do not follow their stated investment strategy and are over-diversified.

The consistency and conviction measures Athena employs are both strong leading indicators of future performance, and higher Diamond Rated funds outperform their lower-rated peers on average over the long-term.

The following criteria are used to select the top funds in each Investment Strategy:

  1. Funds must be actively managed equity funds. No index, asset-allocation, or fund of funds are considered.
  2. Funds must be rated a Five or Four Diamond.
  3. Funds must not have high barriers to purchase, which includes:
    1. Listed on NASDAQ
    2. Open to New Investors
    3. Expense ratio less than 3.0%
    4. Redemption fees are waived after 12 months or less
    5. Minimum initial investment of less than $100,000
  4. Funds must have between $10 million and $1 billion under management.
  5. Funds must have outperformed their peer group on a one-year or ten-year time horizon.
  6. Only the longest-running share class of a fund is considered.
  7. Only the top 5 funds in each Strategy are included. Strategies may include less than five funds if there are not five funds that meet the criteria outlined above.