Hennessy Midstream Fund
Investor
HMSFX
Institutional
HMSIX
Return to Top

  • Overview

    Category
    Sector & Specialty - Energy

    Hennessy Midstream Fund

    Actively managed, the Fund maintains a concentrated portfolio of midstream energy companies and seeks to deliver a significant and predictable income stream.

    Investor

    HMSFX

    Institutional

    HMSIX

    Documents

    Morningstar style box

    Morningstar style box
    portfolio manager perspective
    portfolio manager perspective

    Why Invest

    • Opportunity to invest in core midstream energy companies that should benefit from the growth in production and demand for U.S. energy
    • Concentrated, actively managed portfolio
    • In-depth, rigorous "boots-on-the-ground" research led by managers with decades of combined energy investing experience

    Investment Approach

    The Hennessy Midstream Fund invests primarily in core midstream companies that transport, store, and process oil and natural gas. The Portfolio Managers seek companies with lower commodity price exposure, a "demand-pull" bias, and strong balance sheet metrics, with sufficient cash flows to support an attractive yield.

    The Portfolio Managers employ a fundamental, “boots-on-the-ground” research-intensive investment process to select holdings, focusing on four key steps:

    - Develop commodity forecasts and key sector investment themes

    - Identify primary beneficiaries of investment themes

    - Value companies on both a relative and absolute basis to uncover potential stock mispricing opportunities

    - Size position based on conviction, expected return, volatility, and liquidity

    Portfolio Managers

    “We believe midstream companies are beneficiaries of the energy transformation taking hold globally.”

    - Ben Cook

    Share

  • Insights & News

    View All Fund Insights

  • Performance

    Daily Pricing & Performance

    as of 4/19/24
    • Investor Class (HMSFX)

      • NAV

        $11.36

      • $ Change

        $0.17

      • % Change

        1.52%

      • YTD

        14.14%

    • Institutional Class (HMSIX)

      • NAV

        $11.86

      • $ Change

        $0.18

      • % Change

        1.54%

      • YTD

        14.23%

    Average Annualized Total Return

    as of 3/31/24
    Name 1 Mo YTD 1 yr 3 yr 5 yr 10 yr Since Inception (12/31/13)
    Investor Class (HMSFX) 7.27% 14.85% 38.78% 28.09% 9.73% 2.87% 3.27%
    Institutional Class (HMSIX) 7.33% 14.91% 39.09% 28.40% 10.00% 3.12% 3.52%
    Alerian US Midstream Energy Index 7.49% 13.76% 33.48% 27.93% 12.70% 5.59% 5.86%
    S&P 500® Index 3.22% 10.56% 29.88% 11.49% 15.05% 12.96% 12.83%

    Please swipe to view table

    as of 3/31/24
    Name QTR YTD 1 yr 3 yr 5 yr 10 yr Since Inception (12/31/13)
    Investor Class (HMSFX) 14.85% 14.85% 38.78% 28.09% 9.73% 2.87% 3.27%
    Institutional Class (HMSIX) 14.91% 14.91% 39.09% 28.40% 10.00% 3.12% 3.52%
    Alerian US Midstream Energy Index 13.76% 13.76% 33.48% 27.93% 12.70% 5.59% 5.86%
    S&P 500® Index 10.56% 10.56% 29.88% 11.49% 15.05% 12.96% 12.83%

    Please swipe to view table

    Hypothetical Growth of $10,000

    as of 3/31/2024

    Value of $10,000 invested between 3/31/2023 and 3/31/2024
    Midstream Fund (HMSFX) $13,878
    Midstream Fund (HMSIX) $13,909
    Alerian US Midstream Energy Index $13,348
    S&P 500® Index $12,988

    Value of $10,000 invested between 3/31/2021 and 3/31/2024
    Midstream Fund (HMSFX) $21,014
    Midstream Fund (HMSIX) $21,167
    Alerian US Midstream Energy Index $20,937
    S&P 500® Index $13,859

    Value of $10,000 invested between 3/31/2019 and 3/31/2024
    Midstream Fund (HMSFX) $15,908
    Midstream Fund (HMSIX) $16,107
    Alerian US Midstream Energy Index $18,184
    S&P 500® Index $20,157

    Value of $10,000 invested between 3/31/2014 and 3/31/2024
    Midstream Fund (HMSFX) $13,267
    Midstream Fund (HMSIX) $13,593
    Alerian US Midstream Energy Index $17,224
    S&P 500® Index $33,826

    Value of $10,000 invested between 12/31/2013 and 3/31/2024
    Midstream Fund (HMSFX) $13,902
    Midstream Fund (HMSIX) $14,259
    Alerian US Midstream Energy Index $17,927
    S&P 500® Index $34,438

    Calendar Year Total Returns

      2014 2015 2016 2017 2018 2019 2020 2021 2022 2023
    Investor Class (HMSFX)    		 11.55% -28.17% 21.55% -4.97% -21.20% 11.76% -31.28% 35.93% 28.82% 23.39%
    Institutional Class (HMSIX)    		 11.83% -27.98% 21.87% -4.75% -20.96% 11.96% -31.06% 36.29% 29.10% 23.65%
    Alerian US Midstream Energy Index    		 15.95% -37.54% 33.80% -5.97% -10.91% 15.56% -24.96% 45.01% 29.56% 19.16%
    S&P 500® Index    		 13.69% 1.38% 11.96% 21.83% -4.38% 31.49% 18.40% 28.71% -18.11% 26.29%

    Yield

    as of 3/31/24
    Investor Class (HMSFX) Institutional Class (HMSIX)
    Distribution Rate 9.04% 8.66%
    30-Day SEC Yield 1.50% 1.73%
    Distribution Frequency Quarterly Quarterly
    Most Recent Distribution $0.2575 $0.2575
    Most Recent Distribution Paid Date 03/01/2024 03/01/2024

    Please swipe to view table

    Returns-Based Statistics
    Relative to Alerian US Midstream Energy Index

    as of 3/31/24
    Investor Class (HMSFX)
    Type 3 yr 5 yr 10 yr
    Alpha -0.09 -2.58 -2.48
    Beta 1.01 0.98 0.95
    Upside Capture 100.53 95.45 88.92
    Downside Capture 100.53 101.88 95.68
    Institutional Class (HMSIX)
    Type 3 yr 5 yr 10 yr
    Alpha 0.19 -2.33 -2.23
    Beta 1.01 0.99 0.95
    Upside Capture 100.86 95.71 89.27
    Downside Capture 99.92 101.50 95.33

    Alpha measures the fund’s excess return relative to the return of the benchmark. Beta measures the volatility of the fund compared to that of the benchmark. The beta of the benchmark is 1.00. Capture ratios measure the fund’s overall performance in up markets (positive return periods) and down markets (negative return periods).

    Sharpe Ratio

    as of 3/31/24
    Type 3 yr 5 yr 10 yr
    Investor Class (HMSFX) 1.17 0.39 0.20
    Institutional Class (HMSIX) 1.19 0.40 0.21
    Alerian US Midstream Energy Index 1.19 0.47 0.29
    Energy Limited Partnership Category Average 1.00 0.38 0.16

    Sharpe Ratio is a measure of risk-adjusted return, reflecting the average return earned in excess of the risk-free rate per unit of volatility.

    Standard Deviation

    as of 3/31/24
    Type 3 yr 5 yr 10 yr
    Investor Class (HMSFX) 20.57 34.74 28.05
    Institutional Class (HMSIX) 20.53 34.78 28.08
    Alerian US Midstream Energy Index 20.02 35.11 28.96
    Energy Limited Partnership Category Average 18.95 31.92 26.51

    Standard deviation is a statistical measure of the historical volatility of a mutual fund or portfolio.

    Fund Expenses

    • Investor Class (HMSFX)

      • Gross expense ratio

        2.03%

      • Net expense ratio

        1.78%

    • Institutional Class (HMSIX)

      • Gross expense ratio

        1.65%

      • Net expense ratio

        1.53%

    Performance data quoted represents past performance; past performance does not guarantee future results. The investment return and principal value of an investment will fluctuate so that an investor's shares, when redeemed, may be worth more or less than their original cost. Current performance of the fund may be lower or higher than the performance quoted.

    Each Morningstar category average represents a universe of funds with similar objectives. The Morningstar Style Box reveals the fund's investment style as of 3/31/24. The vertical axis shows the market capitalization of the stocks owned and the horizontal axis shows investment style (value, blend, or growth). ©Morningstar, Inc. All Rights Reserved. Past performance is no guarantee of future results.

    The Alerian US Midstream Energy Index is comprised of US energy infrastructure companies that earn the majority of their cash flow from midstream activities. The S&P 500® Index is an unmanaged index commonly used to measure the performance of U.S. stocks. One cannot invest directly in an index.

    Alerian US Midstream Energy Index is a servicemark of GKD Index Partners, LLC d/b/a Alerian (“Alerian”), and its use is granted under a license from Alerian. Alerian does not permit any party to rely upon and does not accept any liability for any errors, omissions, interruptions, or defects in the Alerian indexes or underlying data.

    Standard & Poor’s Financial Services is the source and owner of the S&P® and S&P 500® trademarks.

    The performance shown for periods on or prior to 10/26/18 is that of the predecessor BP Capital TwinLine MLP Fund.

    Distribution Rate reflects the investment income per share during the last 12 months divided by the share price at the end of the period, expressed as an annual percentage rate. It is calculated by annualizing the Fund’s most recent distribution. The annualized dividend yield may not reflect the actual yield an investor would receive. 30-Day SEC Yield is a standardized yield computed by dividing the net investment income per share earned during the past 30-day period by the share price at the end of the period, expressed as an annual percentage rate. The 30-Day SEC Yield should be regarded as an estimate of the Fund’s rate of recent investment income, and it may not equal the Fund’s actual distribution rate. Past yields are no guarantee of future yields. 30 day SEC Yield subsidized 1.73%; unsubsidized 1.82% as of 3/31/24. Subsidized yields reflect fee waivers in effect.

    A significant portion of the Midstream Fund's distributions to shareholders will be characterized as a "return of capital" because of its MLP investments. Please refer to the 19a-1 Notice sent to shareholders or Tax Forms 8937. for additional information regarding the composition of distributions. Final determination of a distribution’s tax character will be made on Form 1099 DIV sent to shareholders each year.

    The Fund's investment manager has contractually agreed to limit expenses for the Midstream Fund until 2/28/25. In addition, certain service provider expenses for the Midstream Fund will be voluntarily waived through 7/31/25.

    Fund holdings and sector allocations are subject to change and should not be considered a recommendation to buy or sell any security.

    References to other funds should not be interpreted as an offer of these securities.

    DOE refers to the Department of Energy. EIA refers to the U.S.Energy Information Administration. FERC refers to the Federal Energy Regulatory Commission.

  • Portfolio

    Portfolio Allocation

    as of 3/31/24
    Allocation % of Net Assets
    Natural Gas/NGL Transportation 51.4%
    Gathering and Processing 24.6%
    Crude Oil and Refined Products 21.4%
    Cash 2.7%

    Portfolio Characteristics

    as of 3/31/24
    Inception Date (HMSFX) 12/31/13
    Inception Date (HMSIX) 12/31/13
    Total Fund Assets $63 Million
    Active Share vs. Alerian US Midstream Energy Index 38%
    Portfolio Turnover 10%
    Median Market Cap $47.5 Billion
    Median Price/Earnings 12.6x
    Median Price/Book 2.3x

    Price/Earnings measures a stock’s price per share compared to earnings. Price/Book measures a stock’s price per share to book value. Portfolio Turnover and Price/Earnings shown reflect the trailing 12-month period.

    Sector Weighting

    as of 3/31/24
    Fund
    Energy 98.2%
    Cash & Other 1.8%
    Sub-Industry Weighting % of Net Assets
    Oil & Gas Storage & Transportation 98.2%

    Portfolio Holdings

    Top 10 Holdings

    as of 3/31/24
    % of Net Assets
    Top 10 Holdings Ticker Current Vs. 4Q23 Vs. 1Q23 10-Year Holdings History (%) Time Held
    Energy Transfer LP ET 14.39% -0.27% -0.12%
    		6 Years
    Enterprise Products Partners, LP EPD 12.14% -0.60% +0.18%
    		10 Years
    Plains All American Pipeline, LP PAA 11.42% +0.52% +1.09%
    		8 Years
    MPLX, LP MPLX 9.93% -0.26% +0.16%
    		10 Years
    Antero Midstream Corp. AM 7.61% -0.27% -0.39%
    		3 Years
    ONEOK, Inc. OKE 7.56% -0.13% +2.75%
    		5 Years
    Western Midstream Partners LP WES 6.70% +0.29% +0.79%
    		3 Years
    Equitrans Midstream Corp. ETRN 6.60% +0.35% +3.72%
    		1 Year
    Williams Companies, Inc. WMB 5.60% -0.21% -1.39%
    		5 Years
    TC Energy Corp. TRP 3.77% -0.49% +3.77%
    		< 1 Year
    Total as % of Net Assets 85.72%

    Please swipe to view table

    Total Holdings: 15

    as of 3/31/24
    Print All Holdings
    % of Net Assets
    Equity Holdings Ticker Current Vs. 4Q23 Vs. 1Q23 10-Year Holdings History (%) Time Held
    Energy Transfer LP ET 14.39% -0.27% -0.12%
    		6 Years
    Enterprise Products Partners, LP EPD 12.14% -0.60% +0.18%
    		10 Years
    Plains All American Pipeline, LP PAA 11.42% +0.52% +1.09%
    		8 Years
    MPLX, LP MPLX 9.93% -0.26% +0.16%
    		10 Years
    Antero Midstream Corp. AM 7.61% -0.27% -0.39%
    		3 Years
    ONEOK, Inc. OKE 7.56% -0.13% +2.75%
    		5 Years
    Western Midstream Partners LP WES 6.70% +0.29% +0.79%
    		3 Years
    Equitrans Midstream Corp. ETRN 6.60% +0.35% +3.72%
    		1 Year
    Williams Companies, Inc. WMB 5.60% -0.21% -1.39%
    		5 Years
    TC Energy Corp. TRP 3.77% -0.49% +3.77%
    		< 1 Year
    Kinder Morgan, Inc. KMI 3.63% -0.43% -0.10%
    		9 Years
    Targa Resources Corp. TRGP 2.78% +0.27% -4.78%
    		8 Years
    EnLink Midstream, LLC ENLC 2.32% -0.09% -0.28%
    		2 Years
    DT Midstream, Inc. DTM 1.89% -0.08% -0.26%
    		2 Years
    Cheniere Energy Partners, LP CQP 1.87% +1.03% +1.87%
    		1 Year
    Total as % of Net Assets 98.2%
    Cash & Other Holdings % of Net Assets
    Cash & Other 1.8%
    Total as % of Net Assets 1.8%

    Please swipe to view table

    Country Allocation

    as of 3/31/24

    • United States

      94.5%

    • International

      3.8%

    • Cash & Other

      1.8%
    United States 94.5%
    Canada 3.8%
    Cash & Other 1.8%

  • Distributions

    The Hennessy Midstream Fund pays capital gains (if any) once annually, usually in December. Ordinary income distributions are paid quarterly, at the beginning of March, June, September, and December.

    Date Paid Income Short-Term Gain Long-Term Gain Total Per Share Reinvest Price
    03/01/2024 $0.25750 -- -- $0.25750 $10.78
    12/01/2023 $0.25750 -- -- $0.25750 $10.45
    09/01/2023 $0.25750 -- -- $0.25750 $10.12
    06/01/2023 $0.25750 -- -- $0.25750 $9.15
    03/01/2023 $0.25750 -- -- $0.25750 $9.24
    12/01/2022 $0.25750 -- -- $0.25750 $9.60
    09/01/2022 $0.25750 -- -- $0.25750 $9.23
    06/01/2022 $0.25750 -- -- $0.25750 $9.84
    03/01/2022 $0.25750 -- -- $0.25750 $9.01
    12/01/2021 $0.25750 -- -- $0.25750 $7.71
    09/01/2021 $0.25750 -- -- $0.25750 $7.96
    06/01/2021 $0.25750 -- -- $0.25750 $8.59
    03/01/2021 $0.25750 -- -- $0.25750 $7.51
    12/01/2020 $0.25750 -- -- $0.25750 $6.49
    09/01/2020 $0.25750 -- -- $0.25750 $6.13
    06/01/2020 $0.25750 -- -- $0.25750 $7.26
    03/02/2020 $0.25750 -- -- $0.25750 $9.36
    12/02/2019 $0.25750 -- -- $0.25750 $10.24
    09/03/2019 $0.25750 -- -- $0.25750 $11.24
    06/03/2019 $0.25750 -- -- $0.25750 $11.96
    03/01/2019 $0.25750 -- -- $0.25750 $12.39
    12/03/2018 $0.25750 -- -- $0.25750 $12.55
    9/4/2018 $0.25750 -- -- $0.25750 $13.95
    6/1/2018 $0.25750 -- -- $0.25750 $13.74
    3/1/2018 $0.25750 -- -- $0.25750 $13.87
    12/1/2017 $0.25750 -- -- $0.25750 $14.46
    9/1/2017 $0.25750 -- -- $0.25750 $15.10
    6/1/2017 $0.25750 -- -- $0.25750 $15.94
    3/1/2017 $0.25750 -- -- $0.25750 $17.06
    12/1/2016 $0.25750 -- -- $0.25750 $16.01
    9/1/2016 $0.25750 -- -- $0.25750 $16.20
    6/1/2016 $0.25750 -- -- $0.25750 $15.72
    3/1/2016 $0.25750 -- -- $0.25750 $12.81
    12/1/2015 $0.25750 -- -- $0.25750 $14.93
    9/1/2015 $0.25750 -- -- $0.25750 $17.86
    6/1/2015 $0.25750 -- -- $0.25750 $21.68
    3/2/2015 $0.24000 -- -- $0.24000 $21.64
    12/1/2014 $0.24000 -- -- $0.24000 $21.39
    9/2/2014 $0.24000 -- -- $0.24000 $22.99
    6/2/2014 $0.08426 -- -- $0.08426 $22.15
    3/3/2014 $0.09566 -- -- $0.09566 $20.49

    Please swipe to view table

    Past performance is not a guarantee of future results.

    A significant portion of the Midstream Fund's distributions to shareholders will be characterized as a "return of capital" because of its MLP investments. Please refer to the 19a-1 Notice sent to shareholders or Tax Forms 8937. for additional information regarding the composition of distributions. Final determination of a distribution’s tax character will be made on Form 1099 DIV sent to shareholders each year.
    Download historical distributions and NAVs
    Date Paid Income Short-Term Gain Long-Term Gain Total Per Share Reinvest Price
    03/01/2024 $0.25750 -- -- $0.25750 $11.25
    12/01/2023 $0.25750 -- -- $0.25750 $10.89
    09/01/2023 $0.25750 -- -- $0.25750 $10.53
    06/01/2023 $0.25750 -- -- $0.25750 $9.50
    03/01/2023 $0.25750 -- -- $0.25750 $9.58
    12/01/2022 $0.25750 -- -- $0.25750 $9.93
    09/01/2022 $0.25750 -- -- $0.25750 $9.54
    06/01/2022 $0.25750 -- -- $0.25750 $10.16
    03/01/2022 $0.25750 -- -- $0.25750 $9.29
    12/01/2021 $0.25750 -- -- $0.25750 $7.93
    09/01/2021 $0.25750 -- -- $0.25750 $8.18
    06/01/2021 $0.25750 -- -- $0.25750 $8.82
    03/01/2021 $0.25750 -- -- $0.25750 $7.70
    12/01/2020 $0.25750 -- -- $0.25750 $6.64
    09/01/2020 $0.25750 -- -- $0.25750 $6.26
    06/01/2020 $0.25750 -- -- $0.25750 $7.41
    03/02/2020 $0.25750 -- -- $0.25750 $9.54
    12/02/2019 $0.25750 -- -- $0.25750 $10.42
    09/03/2019 $0.25750 -- -- $0.25750 $11.43
    06/03/2019 $0.25750 -- -- $0.25750 $12.15
    03/01/2019 $0.25750 -- -- $0.25750 $12.58
    12/03/2018 $0.25750 -- -- $0.25750 $12.73
    9/4/2018 $0.25750 -- -- $0.25750 $14.13
    6/1/2018 $0.25750 -- -- $0.25750 $13.91
    3/1/2018 $0.25750 -- -- $0.25750 $14.03
    12/1/2017 $0.25750 -- -- $0.25750 $14.62
    9/1/2017 $0.25750 -- -- $0.25750 $15.25
    6/1/2017 $0.25750 -- -- $0.25750 $16.09
    3/1/2017 $0.25750 -- -- $0.25750 $17.21
    12/1/2016 $0.25750 -- -- $0.25750 $16.13
    9/1/2016 $0.25750 -- -- $0.25750 $16.32
    6/1/2016 $0.25750 -- -- $0.25750 $15.82
    3/1/2016 $0.25750 -- -- $0.25750 $12.88
    12/1/2015 $0.25750 -- -- $0.25750 $15.00
    9/1/2015 $0.25750 -- -- $0.25750 $17.92
    6/1/2015 $0.25750 -- -- $0.25750 $21.74
    3/2/2015 $0.24000 -- -- $0.24000 $21.69
    12/1/2014 $0.24000 -- -- $0.24000 $21.42
    9/2/2014 $0.24000 -- -- $0.24000 $23.01
    6/2/2014 $0.08787 -- -- $0.08787 $22.15
    3/3/2014 $0.10726 -- -- $0.10726 $20.49

    Please swipe to view table

    Past performance is not a guarantee of future results.

    A significant portion of the Midstream Fund's distributions to shareholders will be characterized as a "return of capital" because of its MLP investments. Please refer to the 19a-1 Notice sent to shareholders or Tax Forms 8937. for additional information regarding the composition of distributions. Final determination of a distribution’s tax character will be made on Form 1099 DIV sent to shareholders each year.
    Download historical distributions and NAVs

  • Fund Documents

    Download PDF View Online
    Midstream Fund Documents
    Fact Sheet
    Portfolio Perspective View
    Summary Prospectus
    Full Prospectus
    Statement of Additional Information
    Midstream Fund Shareholder Reports and Quarterly Holdings
    Q1 Holdings
    Semi-Annual Report
    Q3 Holdings
    Annual Report

    Currently, paper copies of the annual and semi-annual reports are not sent by mail unless shareholders specifically request paper copies. You may elect to receive paper copies free of charge by calling U.S. Bank Global Fund Services at 1-800-261-6950 or, if you own shares through a financial intermediary, by contacting your financial intermediary.

    **Please note the upcoming change to shareholder report delivery.**

    After July 24, 2024, shareholder reports will be sent by mail unless a shareholder has elected or elects to receive reports electronically via e-delivery. To sign up for e-delivery, please visit My Account. https://www.hennessyfunds.com/account or by calling U.S. Bank Global Fund Services at 1-800-261-6950 or, if you own shares through a financial intermediary, by contacting your financial intermediary.

Explore More Funds

Domestic Equity

Multi-Asset

Sector & Specialty

Get insights and news delivered to you.

Sign up for updates

Learn how Hennessy approaches investing.

Our Philosophy

Let's work together to get you on your way.

Start Investing
Contact Us
Hennessy Funds
7250 Redwood Boulevard, Suite 200
 Novato, CA 94945
Follow Us

The Funds' investment objectives, risks, charges, and expenses must be considered carefully before investing. The prospectus contains this and other important information about the investment company. Please read it carefully before investing. A hard copy of the prospectus can be requested by calling 1-800-966-4354.

Performance data quoted represents past performance; past performance does not guarantee future results. The investment return and principal value of an investment will fluctuate so that an investor's shares, when redeemed, may be worth more or less than their original cost. Current performance of the Fund may be lower or higher than the performance quoted and can be found here. Performance data current to the most recent month end may be obtained from HennessyFunds.com Hennessy Funds Standardized Performance

Neither forward earnings nor earnings growth is a measure of a fund’s future performance.

Mutual fund investing involves risk. Principal loss is possible. Current and future holdings are subject to risk. Small and medium-sized companies may have more limited liquidity and greater price volatility than larger companies. Investments in foreign securities may involve political, economic, and currency risks, greater volatility, and differences in accounting methods. The Focus, Total Return, Balanced, Large Cap Financial, Small Cap Financial, and Midstream Funds are considered non-diversified funds. A non-diversified fund, which may concentrate its assets in fewer individual holdings than a diversified fund, is more exposed to individual stock volatility than a diversified fund. A fund that concentrates its investments within one country, one sector, or a small group of industries, such as Japan, Technology, Financials, or Energy, may be subject to a higher degree of market risk. Investments in debt securities typically decrease in value when interest rates rise. The risk is greater for longer-term debt securities. Investments in lower-rated and non-rated securities present a greater risk of loss to principal and interest than higher-rated securities. Mortgage- and asset-backed securities are subject to prepayment risk, which is the risk that the borrower will prepay some or all of the principal owed to the issuer. Funds that invest in pooled investment vehicles (including ETFs) may experience higher fees. The formula-based strategy employed by some Funds may cause those Funds to buy or sell securities at times when it may not be advantageous.

ETFs are subject to additional risks that do not apply to conventional mutual funds, including the risks that the market price of an ETF’s shares may trade at a premium or discount to its net asset value, an active secondary trading market may not develop or be maintained, or trading may be halted by the exchange in which they trade, which may impact a Fund’s ability to sell its shares. Shares of any ETF are bought and sold at market price (not NAV) and are not individually redeemed from the Fund. Brokerage commissions will reduce returns.

ESG investing risk is the risk stemming from the Environmental, Social, and Governance factors that the Fund applies in selecting securities. The Fund intends to invest in companies with measurable high ESG ratings relative to their sector peers, and screen out particular companies that do not meet its ESG criteria. This may affect the Fund’s exposure to certain companies or industries and cause the Fund to forego certain investment opportunities. The Fund’s returns may be lower than other funds that do not seek to invest in companies based on ESG ratings. The Fund seeks to pursue its investment objective by using proprietary models that incorporate quantitative analysis. There is no guarantee that the Portfolio Managers’ use of these models will result in effective investment decisions for the Fund. From time to time, the Fund may concentrate its investments in one or more industry sectors. The Fund is currently substantially invested in the Consumer Discretionary and Health Care sectors and its performance is therefore tied closely to, and affected by, developments in these industries.

Master Limited Partnerships (MLPs) and MLP investments have unique characteristics. A Fund does not receive the same tax benefits as a direct investment in an MLP.

The prices of MLP units may fluctuate abruptly and trading volume may be low, making it difficult for a Fund to sell its units at a favorable price. MLP general partners have the power to take actions that adversely affect the interests of unit holders. Most MLPs do not pay U.S. federal income tax at the partnership level, but an adverse change in tax laws could result in MLPs being treated as corporations for federal income tax purposes, which could reduce or eliminate distributions paid by MLPs to the Fund. If the Energy Transition Fund’s MLP investments exceed 25% of its assets, it may not qualify for treatment as a regulated investment company (“RIC”) under the Internal Revenue Code (“Code”), and the Fund would be taxed as an ordinary corporation, which could substantially reduce its net assets and its distributions to shareholders. The Midstream Fund is treated as a regular corporation, or “C” corporation, for U.S. federal income tax purposes, and therefore, is subject to U.S. federal income tax on its taxable income at the graduated rates applicable to corporations (currently a maximum rate of 21%) as well as state and local income taxes. The Midstream Fund will not benefit from current favorable federal income tax rates on long-term capital gains, and Fund income and losses will not be passed on to shareholders. The Midstream Fund accrues deferred income taxes for future tax liabilities associated with the portion of MLP distributions considered to be a tax-deferred return of capital and for any net operating gains as well as capital appreciation of its investments. This deferred tax liability is reflected in the daily NAV, and as a result, the Fund’s after-tax performance could differ significantly from the underlying assets even if the pre-tax performance is closely tracked.

Glossary of Terms contains definitions and additional information.

To view the top 10 holdings of a Fund, please click the Fund name: Cornerstone Growth, Focus, Cornerstone Mid Cap 30, Cornerstone Large Growth, Cornerstone Value, Total Return, Equity and Income, Balanced, Energy Transition, Midstream, Gas Utility, Japan, Japan Small Cap, Large Cap Financial, Small Cap Financial, Technology. Fund holdings are subject to change and not recommendations to buy or sell any security.

Opinions expressed are subject to change at any time, are not guaranteed, and should not be considered investment advice.

News and Media Page:

To view the Morningstar ratings for the Japan Fund, please click here. (Media - TD Ameritrade)

To view the Morningstar ratings for the Focus Fund, please click here. (Media - CNBC-B. Macualey).

1 USD = 105.36 Yen as of 07/27/2020 (Media - Ticker - M. Takeda)

Tom White is a TD Ameritrade Network contributor and is not affiliated with the Hennessy Funds. Content is not investment advice, or a recommendation of any security, strategy, or account type. Options involve risks and are not suitable for all investors as the special risks inherent to options trading may expose investors to potentially rapid and substantial losses.(Media - TD Ameritrade-Rothberg)

To view the Morningstar ratings, please click here.

The Hennessy Funds are offered only to United States residents, and information on this web site is intended only for such persons. Nothing on this web site should be considered a solicitation to buy or an offer to sell shares of any Hennessy Fund in any jurisdiction where the offer or solicitation would be unlawful under the securities laws of such jurisdiction.

Quasar Distributors, LLC, Distributor.

Subscribe for Updates

*Required Fields