Академический Документы
Профессиональный Документы
Культура Документы
Apr2000
Mar2003
Apr2003
Mar2006
Apr2000
Mar2006
S&P500 16.1% 17.2% 0.8%
SectorRotation 6.3% 19.0% 5.6%
MarketNeutral 8.2% 1.6% 3.2%
Long/Short 2.8% 6.3% 4.5%
BearMarket BullMarket 6YrRange
Oct1971
Sep1974
Oct1974
Sep1977
Oct1971
Sep1977
S&P500 10.6% 20.0% 3.6%
Sector Rotation 8 7% 28 0% 8 1% SectorRotation 8.7% 28.0% 8.1%
MarketNeutral 12.4% 15.9% 14.1%
Long/Short 4.5% 28.0% 15.7%
BearMarket BullMarket 6YrRange
Jul1929
Jun1932
Jul1932
Jun1935
Jul1929
Jun1935
S&P500 42.4% 39.3% 10.4%
SectorRotation 32.2% 37.0% 3.6%
Market Neutral 32.4% 14.3% 6.6%
Financial professional use only. Do not distribute to the public.
MarketNeutral 32.4% 14.3% 6.6%
Long/Short 11.1% 4.5% 7.7%
Source: Arrow Funds, December 2007 Past performance is not indicative of future returns.
16
Research Point: Consistent Compounding
1Year 3Years 5Years 10Years 20Years 30Years 40Years 50Years 60Years
S&P500 5.5% 8.6% 12.8% 5.9% 11.8% 13.0% 10.5% 11.0% 11.9%
SectorRotation 13.3% 15.4% 15.1% 13.7% 17.6% 18.3% 15.2% 16.3% 16.6%
Market Ne tral 17 7% 14 6% 3 2% 10 6% 11 6% 12 0% 11 4% 11 5% 11 3%
Financial professional use only. Do not distribute to the public.
MarketNeutral 17.7% 14.6% 3.2% 10.6% 11.6% 12.0% 11.4% 11.5% 11.3%
Long/Short 22.4% 20.5% 9.1% 15.7% 18.2% 18.1% 16.1% 17.1% 17.3%
Source: Arrow Funds, December 2007 Past performance is not indicative of future returns.
17
Research Point: Diversification Benefit
As of
Strategic
Portfolio
Strategic
wSectorRotation
Strategic
wMarketNeutral
Strategic
wLongShort
Return Risk Return Risk Return Risk Return Risk
1Year 6.08% 5.86% 7.51% 6.69% 8.35% 4.65% 9.25% 5.78%
3Years 7.01% 4.99% 8.68% 5.99% 8.57% 4.14% 9.72% 5.39%
Asof
Dec2007
5Years 9.43% 5.72% 10.58% 6.45% 8.35% 4.42% 9.55% 5.54%
10Years 6.20% 9.01% 7.76% 10.03% 7.26% 7.35% 8.30% 9.05%
20Years 10.33% 9.35% 11.81% 10.32% 10.76% 7.78% 12.08% 9.38%
30 Years 11.41% 10.85% 12.84% 12.15% 11.68% 9.27% 12.94% 11.17%
Sector Market Long
30Years 11.41% 10.85% 12.84% 12.15% 11.68% 9.27% 12.94% 11.17%
40Years 9.68% 11.00% 10.84% 12.23% 10.21% 9.23% 11.14% 11.11%
50Years 9.42% 10.39% 10.86% 11.61% 10.01% 8.71% 11.11% 10.52%
Equities
48%
Bonds
32%
Sector
Rotation
20%
Equities
60%
Bonds
40%
Equities
48%
Bonds
32%
Market
Neutral
20%
Equities
48%
Bonds
32%
Long
Short
20%
Financial professional use only. Do not distribute to the public.
Source: Arrow Funds, December 2007 Past performance is not indicative of future returns.
18
Creating Absolute Return Strategies
1. Identify a Universe
2 Segment the Universe 2. Segment the Universe
3. Construct a Portfolio of Top & Bottom Tiers
Market Neutral
Absolute Return Strategy
Tools to Segment Sector Universe Tools to Segment
Technical Research
F d l R h
Sector Universe
Stocks
h ( ) Fundamental Research
Quantitative Research
I-shares (DJ Sector ETFs)
ProShares (DJ Sector ETFs)
Financial professional use only. Do not distribute to the public.
19
Arrow DWA Balanced Fund
Tactical Approach for Broad Market Exposure
Performance Review
John Lewis, Portfolio Manager g
Financial professional use only. Do not distribute to the public.
20
DWA Balanced Fund: Performance
Performance displayed represents past performance which is no guarantee of future results The maximum sales charge for A-shares is
Financial professional use only. Do not distribute to the public.
Source: Morningstar and Arrow Funds December 2007
Performance displayed represents past performance, which is no guarantee of future results. The maximum sales charge for A shares is
5.75%. A-share investors may be eligible for a reduction in sales charges. The Fund charges a fee of 1.00% on redemptions of shares held less
than 30 days. The Funds Annual Operating expense is 2.01%
21
DWA Balanced Fund: Holdings
As of 12/31/2007
Financial professional use only. Do not distribute to the public.
22
DWA Balanced Fund: Strategy Breakout
Q42007 Style Sector International FixedIncome Alternative ArrowDWA
Rotation Rotation Rotation Rotation Rotation BalancedFund
Strategy 0.94% 1.54% 0.36% 3.85% 9.88% 2.94%
S&P1500 S&P500 MSCIEAFE LBAGG S&PGSCI FundBenchmark
Benchmark 3.38% 3.33% 1.70% 3.00% 11.64% 0.90%
2007 Style
Rotation
Sector
Rotation
International
Rotation
FixedIncome
Rotation
Alternative
Rotation
ArrowDWA
BalancedFund
Strategy 7.33% 16.90% 30.55% 6.59% 15.91% 15.29%
S&P1500 S&P500 MSCIEAFE LBAGG S&PGSCI FundBenchmark
Benchmark 5.47% 5.49% 11.63% 6.96% 32.67% 6.08%
Performance displayed represents past performance, which is no guarantee of future results. The maximum sales charge for A-shares is
5.75%. A-share investors may be eligible for a reduction in sales charges. The Fund charges a fee of 1.00% on redemptions of shares held less
than 30 days. The Funds Annual Operating expense is 2.01%
Financial professional use only. Do not distribute to the public.
Source: Morningstar and Arrow Funds December 2007
23
Arrow DWA Balanced Fund
Seeks Absolute Returns With Targeted Risk
Performance Review
Bill Flaig, Portfolio Manager
Financial professional use only. Do not distribute to the public.
24
Alternative Solutions Fund: Holdings (12/31/07)
Financial professional use only. Do not distribute to the public.
Source: Arrow Funds December 2007
25
Fund Performance
Arrow Alternative Solutions Fund
Average Annual Total Returns
As of 12/31/07
CLASS 1-Month
Since
Inception
(10/31/07)
A Shares 2.1% 2.3%
AdvisorShares 2.3% 2.3%
Fund
Benchmark
0.32% -0.68%
Cat:
Long/Short
-0.13% -1.35%
Performance displayed represents past performance, which is no guarantee of future results. The maximum sales charge for A-shares
is 5.75%. A-share investors may be eligible for a reduction in sales charges. The Fund charges a fee of 1.00% on redemptions of shares held
less than 30 days. The Funds Annual Operating expense is 1.52%
The Fund benchmark is blend of three Credit Suisse/Tremont Hedge Fund Indices: 33.3% Long Short Equity, 33.3% Fixed
Income Arbitrage and 33.3% Managed Futures Indices. The Credit Suisse/ Tremont Hedge Fund Indices are the asset-
weighted benchmarks of hedge fund performance. It is not possible to invest in indexes which are unmanaged and do not
Financial professional use only. Do not distribute to the public.
26
g g p p g
incur fees and charges.
Disclosure
An investor should consider the Funds investment objective, risks, charges, and expenses carefully
before investing or sending money. This and other information about Arrow Funds is contained in the
funds prospectus, which can be obtained by calling 1-877-277-6933. Please read the prospectus carefully
b f i ti Th A i di t ib t d b A i F d Di t ib t LLC b FINRA/SIPC
The Arrow DWA Balanced Fund may invest in commodity related securities which may be subject to greater volatility than
investments in traditional securities. The Fund may invest in international and emerging market securities which may be
subject to special to risks including fluctuations in currency government regulation differences in accounting standards and
before investing. The Arrow is distributed by Aquarius Fund Distributors, LLC member FINRA/SIPC.
0211-AFD-2/27/2008
subject to special to risks including fluctuations in currency, government regulation, differences in accounting standards and
liquidity. The Fund may invest in small-cap securities which may have special risks associated including wider variations in
earnings and business prospects than larger, more established companies. The Fund may invest in real estate related
securities which may be subject to mortgage-related risks and real estate market fluctuations. The Fund may invest in fixed
income securities which are subject to risks including interest rate, credit and inflation risk. The Fund is non-diversified as
there are a limited number of underlying funds available and each holding has the potential for a greater impact on the
Funds return. However, the underlying funds have access to a large number of different investments providing the
additional diversification benefits discussed in the presentation. The Arrow Alternative Solutions Fund may not be
suitable for all investors. The funds use of derivatives such as futures, options and swap agreements may expose the fund
to additional risks that it would not be subject to if it invested directly in the securities underlying those derivatives. Investing
in leveraged instruments will magnify any gains or losses on those instruments. Investing in commodity and currency
l t d iti b bj t t t l tilit th i t t i t diti l iti Th f d' f h t related securities may be subject to greater volatility than investments in traditional securities. The fund's use of short
selling involves increased risks and additional costs. Investing in small-cap securities, may have special risks associated
including wider variations in earnings and business prospects than larger, more established companies. The Fund may
invest in fixed income securities, which are subject to risks including interest rate, credit and inflation.
The maximum sales charge for Arrows A shares is 5 75% A share investors may be eligible for a reduction in sales
Financial professional use only. Do not distribute to the public.
27
The maximum sales charge for Arrows A-shares is 5.75%. A-share investors may be eligible for a reduction in sales
charges. The Fund charges a fee of 1.00% on redemptions of shares held less than 30 days. The Arrow DWA Balanced
Funds annual operating expense is 2.01%. The Arrow Alternative Solutions Funds annual operating expense is 1.54%.
Arrow Contact Information
Steve Topley
Mid-Atlantic Mid Atlantic
(215) 348-1529
Day Thomas y
South Midwest
(210) 695-8542
Gary Garcia
Mountain
(303) 329-2679 ( )
All other territories
Jake Griffith, Director of Sales
John Labadini
Internal Sales
Financial professional use only. Do not distribute to the public.
Jake Griffith, Director of Sales
(301) 260-0163
Internal Sales
(617) 259-1633
28
Fund Performance
Arrow DWA Balanced Fund
Average Annual Total Returns
As of 12/31/07
CLASS 1-Month 3-Month 1-Year
Since
Inception
(8/7/06)
A Sh 1 19% 2 94% 15 29% 17 72%
As of 12/31/07
A Shares 1.19% 2.94% 15.29% 17.72%
AdvisorShares 1.04% 2.74% 14.28% 16.77%
Fund
Benchmark
-0.30% -0.90% 6.08% 10.55%
Benchmark
Performance displayed represents past performance, which is no guarantee of future results. The maximum sales charge for A-shares
is 5.75%. A-share investors may be eligible for a reduction in sales charges. The Fund charges a fee of 1.00% on redemptions of shares held
less than 30 days. The Funds Annual Operating expense is 2.01% y p g p
The Fund benchmark is a blend of two indices: 60% S&P 500 and 40% Lehman Aggregate Bond Index. The Lehman
Brothers U.S. Aggregate Bond Index is an unmanaged index composed of investment-grade securities from the Lehman
Brother Government/ Credit Bond Index, Mortgage-Backed Securities Index, and Asset-Backed Securities Index. The S&P
Index is the Standard & Poors Composite Index of 500 stocks and is a widely recognized, unmanaged index of common
Financial professional use only. Do not distribute to the public.
29
p y g , g
stock prices. It is not possible to invest in indexes which are unmanaged and do not incur fees and charges.
Fund Performance
Arrow Alternative Solutions Fund
Average Annual Total Returns
As of 12/31/07
CLASS 1-Month
Since
Inception
(10/31/07)
A Shares 2 1% 2 3%
As of 12/31/07
A Shares 2.1% 2.3%
AdvisorShares 2.3% 2.3%
Fund
Benchmark
0.32% -0.68%
Benchmark
Cat:
Long/Short
-0.13% -1.35%
Performance displayed represents past performance, which is no guarantee of future results. The maximum sales charge for A-shares
is 5.75%. A-share investors may be eligible for a reduction in sales charges. The Fund charges a fee of 1.00% on redemptions of shares held
less than 30 days. The Funds Annual Operating expense is 1.52%
The Fund benchmark is blend of three Credit Suisse/Tremont Hedge Fund Indices: 33.3% Long Short Equity, 33.3% Fixed
Income Arbitrage and 33.3% Managed Futures Indices. The Credit Suisse/ Tremont Hedge Fund Indices are the asset-
weighted benchmarks of hedge fund performance. It is not possible to invest in indexes which are unmanaged and do not
Financial professional use only. Do not distribute to the public.
30
g g p p g
incur fees and charges.