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Foresters Financial launches Covered Call Strategy Fund


Foresters Financial has launched a new equity mutual fund—the First Investors Covered Call Strategy Fund—which offers investors the potential to generate long-term capital appreciation while potentially reducing portfolio volatility.

"This Fund will appeal to equity investors who want equity-like returns," says Wiley D Angell, Chief Investment Officer, FAMCO Group, and Senior Portfolio Manager at Ziegler Capital Management, the subadviser for the Fund, "but who also seek less volatility than the stock market."

In recent years, Covered Call investing has attracted a great deal of attention from investors searching for lower-volatility equity strategies with an attractive dividend- income component. This type of fund combines a traditional, well-known asset class (stocks), with an alternative asset class (call options). By selling call options, an equity fund can generate income and provide some downside protection, while retaining the long-term capital appreciation potential of the equity asset class.

"These risk-reducing characteristics can potentially produce superior risk-adjusted returns over time relative to an equity-only approach," says Angell. "As a result, a covered call strategy can help mitigate downside risk and offer less volatility than a stock-only portfolio, which may appeal to investors who are concerned about market volatility."

"The First Investors Covered Call Strategy Fund provides our clients with an exciting new equity investment choice and further enhances our overall product lineup," says Brian Watts, Director of Research and Strategy for Foresters Investment Management Company, Inc. "The new Fund can be used by clients as either a stand-alone investment, or as a core holding within their investment portfolio."

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