First Quarter 2021 Commentary

Markets continued to rally in Q1 despite political and pandemic challenges, ending the quarter at or near all-time highs. Pandemic impacts are waning with the rate of vaccinations accelerating during the quarter and optimistic feelings permeating markets. Disruption in the economy and markets has created unique opportunities and a favorable environment for skilled active management along with market volatility that has been higher than usual and may continue. We believe that taking a long-term perspective and following a disciplined investment approach will be essential to navigating the next year.

• The Q1 economy strengthened dramatically, as indicated by a March PMI Manufacturing index at a 40 year high of 65 and a PMI Services index at an all-time high, (by 3 points) of 64. The latter was most impacted by the pandemic, so it is reassuring to see the 8.4 jump from February to March.
• The job market, which tends to lag overall economic activity, also took a big step in March, with nearly one million jobs being added. The hospitality and travel industries were major beneficiaries. This rapid healing of the employment market has led to GDP growth rate forecasts as high as 10% for Q3 and Q4.
• Our market indicators strengthened during the quarter, with economic and technical measures very strong, behavioral measures normal to very strong, while valuation measures remain elevated.

• Global Tactical ETFs - 20.6% vs 11.0% since inception (9/1/2010).¹
• Pure Valuation Profitability - 17.1% vs 10.2% since inception (7/1/2002).²

For portfolio-specific commentary, click on the links below.

Portfolio Commentaries
Global Tactical ETFs
Pure Valuation | Profitability
Managed Equity

The Athena Global Tactical ETFs is ranked the #1 performing strategy, for 10-year performance, in Morningstar’s 311-member Tactical Allocation category as of 12/31/2020.³

• During the last 10 years, including 2020's unprecedented market turmoil, the Athena Global Tactical ETFs portfolio outperformed its benchmarks.
• This portfolio is ranked 5-Stars Overall and for the 3, 5 and 10 year, in Morningstar's 311-member Tactical Allocation category.³
• The portfolio has received Morningstar's highest rating of 5-Stars Overall for 25 consecutive quarters as of 12/31/20, since Morningstar has been tracking the portfolio in the Tactical Allocation category.³

Source: Athena Invest

DISCLOSURES
(1) The benchmark for the Athena Global Tactical ETFs portfolio is comprised of 100% Morningstar Global Markets Index. This benchmark was selected to generally represent a similar opportunity set of investments compared with the portfolio. The portfolio does not seek to replicate the composition, performance, or volatility of the benchmark or its constituent indices and can be expected to have investments that differ substantially from the securities included in any index. Accordingly, no representation is made that the performance, volatility, or other characteristics of the portfolio will track the benchmark. It is not possible to invest directly in an index.

(2) The benchmark for the Athena Pure Valuation | Profitability portfolio is comprised of 100% Morningstar US Mid Value Index. This benchmark was selected to generally represent a similar opportunity set of investments compared with the portfolio. The portfolio does not seek to replicate the composition, performance, or volatility of the benchmark or its constituent indices and can be expected to have investments that differ substantially from the securities included in any index. Accordingly, no representation is made that the performance, volatility, or other characteristics of the portfolio will track the benchmark. It is not possible to invest directly in an index.

(3) Morningstar Ratings™ are based on risk-adjusted performance as of 12/31/2020. The Morningstar Rating™ for a strategy is derived from a weighted-average of the performance figures associated with its three-, five- and ten-year (if applicable) Morningstar Rating™ metrics. For each strategy with at least a three-year history, Morningstar calculates a Morningstar Rating™ based on a Morningstar Risk-Adjusted Return measure that accounts for variation in a strategy’s monthly performance (including the effects of applicable fees), placing more emphasis on downward variations and rewarding consistent performance. The top 10% of strategies in each category receive 5 stars, the next 22.5% receive 4 stars, the next 35% receive 3 stars, the next 22.5% receive 2 stars and the bottom 10% receive 1 star.

© 2021 Morningstar. All Rights Reserved. The information contained herein: (1) is proprietary to Morningstar and/or its content providers; (2) may not be copied or distributed; and (3) is not warranted to be accurate, complete or timely. Neither Morningstar nor its content providers are responsible for any damages or losses arising from any use of this information. Past performance is no guarantee of future results.

It should not be assumed that recommendations of AthenaInvest made herein or in the future will be profitable or will equal the past performance records of any AthenaInvest investment strategy or product. There can be no assurance that future recommendations will achieve comparable results.

You are solely responsible for determining whether any investment, investment strategy, security or related transaction is appropriate for you based on your personal investment objectives and financial circumstances. You should consult with a qualified financial adviser, legal or tax professional regarding your specific situation. Investments involve risk and unless otherwise stated, are not guaranteed. Past performance is not indicative of future performance.