Washington, D.C. 20549
Matrix 360 Administration, LLC.
The Semi-Annual report to Shareholders of the WP Large Cap Income Plus Fund, a series of the 360 Funds, for the period ended February 28, 2015 pursuant to Rule 30e-1 under the Investment Company Act of 1940 (the “1940 Act”), as amended (17 CFR 270.30e-1) is filed herewith.
| Winning Points Funds | SEMI-ANNUAL REPORT |
WP Large Cap Income Plus Fund
NOTES TO THE FINANCIAL STATEMENTS
February 28, 2015 (Unaudited)
| 1. | ORGANIZATION AND SIGNIFICANT ACCOUNTING POLICIES |
The WP Large Cap Income Plus Fund (the “Fund”) is a series of 360 Funds (the “Trust”). The Trust was organized on February 25, 2005 as a Delaware statutory trust. The Trust is registered as an open-end management investment company under the Investment Company Act of 1940 (the “1940 Act”). The Fund is a diversified Fund. The Fund’s investment objective is total return. The Fund’s investment adviser is Winning Points Advisers, LLC (the “Adviser”). The Fund has three classes of shares, Class A, Class C and Institutional Class shares. Currently only the Institutional Class shares are being offered for sale. The Institutional Class shares commenced operations on October 10, 2013.
a) Security Valuation – All investments in securities are recorded at their estimated fair value, as described in note 2.
b) Written Options – When a Fund writes an option, an amount equal to the premium received by the Fund is recorded as a liability and is subsequently adjusted to the current fair value of the option written. If an option sold by the Fund expires unexercised, the Fund realizes a capital gain equal to the premium received at the time the option was written. The Fund will realize a capital gain from a closing purchase transaction if the cost of the closing option is less than the premium received from writing the option, or, if the cost is more, the Fund will realize a capital loss. If a call option is exercised, the premium is added to the proceeds from the sale of the underlying security or currency in determining whether the Fund has realized a gain or loss.
c) Exchange Traded Funds – The Fund may invest in Exchange Traded Funds (“ETFs”). ETFs are registered investment companies and incur fees and expenses such as operating expenses, licensing fees, registration fees, trustees fees, and marketing expenses, and ETF shareholders, such as a Fund, pay their proportionate share of these expenses. Your cost of investing in a Fund will generally be higher than the cost of investing directly in ETFs. By investing in a Fund, you will indirectly bear fees and expenses charged by the underlying ETFs in which a Fund invests in addition to a Fund's direct fees and expenses.
d) Federal Income Taxes – The Fund has qualified and intends to continue to qualify as a regulated investment company under Subchapter M of the Internal Revenue Code of 1986, as amended (the “Code”). It is the policy of the Fund to comply with the requirements of the Code applicable to regulated investment companies and to distribute substantially all of its net investment company taxable income and net capital gains. Therefore, no provision for federal income taxes is required.
As of and during the six month period ended February 28, 2015, the Fund did not have a liability for any unrecognized tax expenses. The Fund recognizes interest and penalties, if any, related to unrecognized tax liability as income tax expense in the statement of operations. During the six month period ended February 28, 2015, the Fund did not incur any interest or penalties. The Fund identifies its major tax jurisdictions as U.S. Federal and Delaware state.
e) Distributions to Shareholders – Dividends from net investment income and distributions of net realized capital gains, if any, will be declared and paid at least annually. Income and capital gain distributions, which are determined in accordance with income tax regulations, are recorded on the ex-dividend date. Accounting principles generally accepted in the United States of America (“GAAP”) requires that permanent financial reporting differences relating to shareholder distributions be reclassified to paid-in capital or net realized gains.
f) Use of Estimates – The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates.
g) Other – Investment and shareholder transactions are recorded on trade date. The Fund determines the gain or loss realized from the investment transactions by comparing the original cost of the security lot sold with the net sales proceeds. Dividend income is recognized on the ex-dividend date or as soon as information is available to the Fund and interest income is recognized on an accrual basis. Withholding taxes on foreign dividends have been provided for in accordance with the Fund’s understanding of the applicable country’s tax rules and rates.
| Winning Points Funds | SEMI-ANNUAL REPORT |
WP Large Cap Income Plus Fund
NOTES TO THE FINANCIAL STATEMENTS
February 28, 2015 (Unaudited)
Processes and Structure
The Fund’s Board of Trustees has adopted guidelines for valuing securities and other derivative instruments including in circumstances in which market quotes are not readily available, and has delegated authority to the Adviser to apply those guidelines in determining fair value prices, subject to review by the Board of Trustees.
Hierarchy of Fair Value Inputs
The company utilizes various methods to measure the fair value of most of its investments on a recurring basis. GAAP establishes a hierarchy that prioritizes inputs to valuation techniques used to measure fair value. The three levels of inputs are as follows:
| • | Level 1 – Unadjusted quoted prices in active markets for identical assets or liabilities that the company has the ability to access. |
| • | Level 2 – Observable inputs other than quoted prices included in level 1 that are observable for the asset or liability either directly or indirectly. These inputs may include quoted prices for the identical instrument on an inactive market, prices for similar instruments, interest rates, prepayment speeds, credit risk, yield curves, default rates, and similar data. |
| • | Level 3 – Unobservable inputs for the asset or liability to the extent that relevant observable inputs are not available, representing the company's own assumptions about the assumptions that a market participant would use in valuing the asset or liability, and that would be based on the best information available. |
The availability of observable inputs can vary from security to security and is affected by a wide variety of factors, including, for example, the type of security, whether the security is new and not yet established in the marketplace, the liquidity of markets, and other characteristics particular to the security. To the extent that valuation is based on models or inputs that are less observable or unobservable in the market, the determination of fair value requires more judgment. Accordingly, the degree of judgment exercised in determining fair value is greatest for instruments categorized in level 3.
The inputs used to measure fair value may fall into different levels of the fair value hierarchy. In such cases, for disclosure purposes, the level in the fair value hierarchy within which the fair value measurement falls in its entirety is determined based on the lowest level input that is significant to the fair value measurement in its entirety.
Fair Value Measurements
A description of the valuation techniques applied to the company's major categories of assets and liabilities measured at fair value on a recurring basis follows.
Equity securities (common stock and ETFs) – Securities traded on a national securities exchange (or reported on the NASDAQ national market) are stated at the last reported sales price on the day of valuation. To the extent these securities are actively traded, and valuation adjustments are not applied, they are categorized in level 1 of the fair value hierarchy. Certain foreign securities may be fair valued using a pricing service that considers the correlation of the trading patterns of the foreign security to the intraday trading in the U.S. markets for investments such as American Depositary Receipts, financial futures, Exchange Traded Funds, and the movement of the certain indexes of securities based on a statistical analysis of the historical relationship and that are categorized in level 2. Preferred stock and other equities traded on inactive markets or valued by reference to similar instruments are also categorized in level 2.
| Winning Points Funds | SEMI-ANNUAL REPORT |
WP Large Cap Income Plus Fund
NOTES TO THE FINANCIAL STATEMENTS
February 28, 2015 (Unaudited)
| 2. | SECURITIES VALUATIONS (continued) |
Money market funds – Money market funds are valued at their net asset value of $1.00 per share and are categorized as Level 1.
Derivative instruments – Listed derivatives, including options, that are actively traded are valued based on quoted prices from the exchange and categorized in level 1 of the fair value hierarchy. Options held by the Fund for which no current quotations are readily available and which are not traded on the valuation date are valued at the mean price and are categorized within level 2 of the fair value hierarchy. Over-the-counter (OTC) derivative contracts include forward, swap, and option contracts related to interest rates; foreign currencies; credit standing of reference entities; equity prices; or commodity prices, and warrants on exchange-traded securities. Depending on the product and terms of the transaction, the fair value of the OTC derivative products can be modeled taking into account the counterparties' creditworthiness and using a series of techniques, including simulation models. Many pricing models do not entail material subjectivity because the methodologies employed do not necessitate significant judgments, and the pricing inputs are observed from actively quoted markets, as is the case of interest rate swap and option contracts. OTC derivative products valued using pricing models are categorized within level 2 of the fair value hierarchy.
The following table summarizes the inputs used to value the Fund’s assets and liabilities measured at fair value as of February 28, 2015.
WP Large Cap Income Plus Fund
Financial Instruments – Assets
Security Classification (1) | | Level 1 | | | Level 2 | | | Level 3 | | | Totals | |
Common Stock (2) | | $ | 22,226,979 | | | $ | - | | | $ | - | | | $ | 22,226,979 | |
Exchange-Traded Funds (2) | | | 1,520,715 | | | | - | | | | - | | | | 1,520,715 | |
| Call Options Purchased | | | 4,250 | | | | - | | | | - | | | | 4,250 | |
| Put Options Purchased | | | 46,250 | | | | - | | | | - | | | | 46,250 | |
| Short-Term Investments | | | 864,332 | | | | - | | | | - | | | | 864,332 | |
| Total Assets | | $ | 24,662,526 | | | $ | - | | | $ | - | | | $ | 24,662,526 | |
Derivative Instruments – Liabilities | | | | | | | | | | | | |
| | | | | | | | | | | | | |
Security Classification (1) | | Level 1 | | | Level 2 | | | Level 3 | | | Totals | |
| Call Options Written | | $ | 216,055 | | | $ | 474,512 | | | $ | - | | | $ | 690,567 | |
| Put Options Written | | | 1,684,870 | | | | 34,450 | | | | - | | | | 1,719,320 | |
| Total Liabilities | | $ | 1,900,925 | | | $ | 508,962 | | | $ | - | | | $ | 2,409,887 | |
| (1) | As of and during the six month period ended February 28, 2015, the Fund held no securities that were considered to be “Level 3” securities (those valued using significant unobservable inputs). Therefore, a reconciliation of assets in which significant unobservable inputs (Level 3) were used in determining fair value is not applicable. |
| (2) | All common stock and exchange traded funds (“ETFs”) held in the Fund are Level 1 securities. For a detailed break-out of common stock by industry and ETFs by investment type, please refer to the Schedule of Investments. |
There were no transfers into and out of any Level during the six month period ended February 28, 2015. It is the Fund’s policy to recognize transfers between Levels at the end of the reporting period.
During the six month period ended February 28, 2015, no securities were fair valued.
| Winning Points Funds | SEMI-ANNUAL REPORT |
WP Large Cap Income Plus Fund
NOTES TO THE FINANCIAL STATEMENTS
February 28, 2015 (Unaudited)
| 3. | DERIVATIVES TRANSACTIONS |
As of February 28, 2015, portfolio securities valued at $23,743,992 were held in escrow by the custodian as cover for options written by the Fund.
Transactions in options written during the six month period ended February 28, 2015 were as follows:
| | | Call Options | |
| | | Number of Options* | | | Option Premiums | |
| Options outstanding at beginning of period | | | 4,937 | | | $ | 700,934 | |
| Options written | | | 14,739 | | | | 3,950,229 | |
| Options covered | | | (15,048 | ) | | | (3,906,308 | ) |
| Options exercised | | | - | | | | - | |
| Options expired | | | (127 | ) | | | (17,638 | ) |
| Options outstanding end of period | | | 4,501 | | | $ | 727,217 | |
| | | Put Options | |
| | | Number of Options* | | | Option Premiums | |
| Options outstanding at beginning of period | | | 2,290 | | | $ | 505,497 | |
| Options written | | | 13,991 | | | | 7,582,650 | |
| Options covered | | | (13,278 | ) | | | (6,196,275 | ) |
| Options exercised | | | - | | | | - | |
| Options expired | | | (103 | ) | | | (25,724 | ) |
| Options outstanding end of period | | | 2,900 | | | $ | 1,866,148 | |
| * | One option contract is equivalent to one hundred shares of common stock. |
As of February 28, 2015, the Statement of Assets and Liabilities included the following financial derivative instrument fair values:
| Assets | | Equity Contracts | | | Total | |
| Call options purchased, at value | | $ | 4,250 | | | $ | 4,250 | |
| Put options purchased, at value | | | 46,250 | | | | 46,250 | |
| Total Assets | | $ | 50,500 | | | $ | 50,500 | |
| Liabilities | | Equity Contracts | | | Total | |
| Call options written, at value | | $ | 690,567 | | | $ | 690,567 | |
| Put options written, at value | | | 1,719,320 | | | | 1,719,320 | |
| Total Liabilities | | $ | 2,409,887 | | | $ | 2,409,887 | |
For the six month period ended February 28, 2015, financial derivative instruments had the following effect on the Statement of Operations:
| Net change in unrealized depreciation on: | | Equity Contracts | | | Total | |
| Call options purchased | | $ | 2,551 | | | $ | 2,551 | |
| Put options purchased | | | (59,180 | ) | | | (59,180 | ) |
| Call options written | | | 206,892 | | | | 206,892 | |
| Put option written | | | 175,321 | | | | 175,321 | |
| | | $ | 325,584 | | | $ | 325,584 | |
| Winning Points Funds | SEMI-ANNUAL REPORT |
WP Large Cap Income Plus Fund
NOTES TO THE FINANCIAL STATEMENTS
February 28, 2015 (Unaudited)
| 3. | DERIVATIVES TRANSACTIONS (continued) |
| Net realized gain (loss) on: | | Equity Contracts | | | Total | |
| Call options purchased | | $ | (14,959 | ) | | $ | (14,959 | ) |
| Put options purchased | | | (466,256 | ) | | | (466,256 | ) |
| Call options written | | | (1,537,421 | ) | | | (1,537,421 | ) |
| Put option written | | | 740,707 | | | | 740,707 | |
| | | $ | (1,277,929 | ) | | $ | (1,277,929 | ) |
The following table presents the Funds’ liability derivatives available for offset under a master netting arrangement net of collateral pledged as of February 28, 2015.
| Liabilities: | | Gross Amounts of Assets Presented in the Statement of Assets & Liabilities | |
| | | Gross Amounts of Recognized Liabilities | | | Financial Instruments Pledged | | | Cash Collateral Pledged | | | Net Amount of Assets | |
| Options Written Contracts | | $ | 2,409,887 | (1) | | $ | 2,409,887 | (2) | | $ | - | | | $ | - | |
| Total | | $ | 2,409,887 | (1) | | $ | 2,409,887 | (2) | | $ | - | | | $ | - | |
| (1) | Written options at value as presented in the Portfolio of Investments. |
| (2) | The amount is limited to the derivative liability balance and accordingly does not include excess collateral pledged. |
| 4. | CAPITAL SHARE TRANSACTIONS |
Transactions in shares of capital stock for the Fund for the six month period ended February 28, 2015 were as follows:
| WP Large Cap Income Plus Fund: | | Sold | | | Redeemed | | | Reinvested | | | Net Increase | |
| Institutional Class | | | | | | | | | | | | |
| Shares | | | 534,204 | | | | (60,250 | ) | | | - | | | | 473,954 | |
| Value | | $ | 5,464,047 | | | $ | (602,078 | ) | | | - | | | $ | 4,861,969 | |
Transactions in shares of capital stock for the Fund for the period since inception from October 10, 2013 through August 31, 2014 were as follows:
| WP Large Cap Income Plus Fund: | | Sold | | | Redeemed | | | Reinvested | | | Net Increase | |
| Institutional Class | | | | | | | | | | | | |
| Shares | | | 1,839,641 | | | | (30,493 | ) | | | - | | | | 1,809,148 | |
| Value | | $ | 18,574,888 | | | $ | (316,907 | ) | | | - | | | $ | 18,257,981 | |
| Winning Points Funds | SEMI-ANNUAL REPORT |
WP Large Cap Income Plus Fund
NOTES TO THE FINANCIAL STATEMENTS
February 28, 2015 (Unaudited)
| 5. | INVESTMENT TRANSACTIONS |
For the six month period ended February 28, 2015, aggregate purchases and sales of investment securities (excluding short-term investments) for the Fund were as follows:
| Purchases | Sales |
| $5,119,825 | $ 5,102 |
There were no government securities purchased or sold during the period.
| 6. | ADVISORY FEES AND OTHER RELATED PARTY TRANSACTIONS |
The Fund has entered into an Investment Advisory Agreement (the “Advisory Agreement”) with the Adviser. Pursuant to the Advisory Agreement, the Adviser manages the operations of the Fund and manages the Fund’s investments in accordance with the stated policies of the Fund. As compensation for the investment advisory services provided to the Fund, the Adviser will receive a monthly management fee equal to an annual rate of 1.35% of the Fund’s net assets. For the six month period ended February 28, 2015, the Adviser earned $142,041 of advisory fees.
The Fund has entered into an Investment Company Services Agreement (“ICSA”) with Matrix 360 Administration, LLC (“M3Sixty”). Pursuant to the ICSA, M3Sixty will provide day-to-day operational services to the Fund including, but not limited to: (a) Fund accounting services; (b) financial statement preparation; (c) valuation of the Fund's portfolio securities; (d) pricing the Fund's shares; (e) assistance in preparing tax returns; (f) preparation and filing of required regulatory reports; (g) communications with shareholders; (h) coordination of Board and shareholder meetings; (i) monitoring the Fund's legal compliance; (j) maintaining shareholder account records.
For the six month period ended February 28, 2015, M3Sixty earned $91,763, including out of pocket expenses with $15,000 remaining payable at February 28, 2015.
Certain officers and a Trustee of the Funds are also employees of M3Sixty.
The Fund has entered into a Distribution Agreement with Matrix Capital Group, Inc. (the “Distributor”). Pursuant to the Distribution Agreement, the Distributor will provide distribution services to the Fund. The Distributor serves as underwriter/distributor of the Fund.
The Distributor is an affiliate of M3Sixty.
The Fund has adopted a Distribution Plan (“Plan”) pursuant to Rule 12b-1 under the Investment Company Act of 1940. The Fund may expend up to 0.25% for Institutional Class shares of the Fund’s average daily net assets annually to pay for any activity primarily intended to result in the sale of shares of the Fund and the servicing of shareholder accounts, provided that the Trustees have approved the category of expenses for which payment is being made.
The distribution plan for the Institutional Class shares of the Fund took effect October 10, 2013. For the six month period ended February 28, 2015, the Fund accrued $26,304 in 12b-1 expenses attributable to Institutional Class shares.
For U.S. Federal income tax purposes, the cost of securities owned, gross appreciation, gross depreciation, and net unrealized appreciation/(depreciation) of investments at February 28, 2015 were as follows:
| Cost | | Gross Appreciation | | Gross Depreciation | | Net Appreciation |
| $ 21,290,788 | | $ 2,419,053 | | $ (1,457,202) | | $ 961,851 |
The difference between book basis and tax basis unrealized appreciation (depreciation) is primarily attributable to the tax deferral of losses on wash sales and mark-to-market on 1256 contracts.
| Winning Points Funds | SEMI-ANNUAL REPORT |
WP Large Cap Income Plus Fund
NOTES TO THE FINANCIAL STATEMENTS
February 28, 2015 (Unaudited)
| 7. | TAX MATTERS (continued) |
The Fund’s tax basis distributable earnings are determined only at the end of each fiscal year. The tax character of distributable earnings (deficit) at August 31, 2014, the Fund’s most recent fiscal year end, was as follows:
| Unrealized Appreciation (Depreciation) | Undistributed Ordinary Income | Undistributed Long-Term Capital Gains | Capital Loss Carry Forwards | Post-October Loss and Late Year Loss | Total Distributable Earnings |
| $ 980,814 | $ - | $ - | $ - | $ (113,502) | $ 867,312 |
The difference between book basis and tax basis unrealized appreciation (depreciation), post-October loss and late year loss and accumulated net realized losses from investments is primarily attributable to the tax deferral of losses on wash sales and mark-to-market on 1256 contracts.
Under current tax law, net capital losses realized after October 31st and net ordinary losses incurred after December 31st may be deferred and treated as occurring on the first day of the following fiscal year. The Fund’s carryforward losses, post-October losses and post-December losses are determined only at the end of each fiscal year. As of August 31, 2014, the Fund elected to defer net capital losses as indicated in the chart below.
| Post-October Losses | | Post-December Losses |
| Deferred | Utilized | | Deferred | Utilized |
| $ 29,070 | $ - | | $ 84,432 | $ - |
Under the Regulated Investment Company Modernization Act of 2010 (the Act), net capital losses recognized after December 31, 2010, may be carried forward indefinitely, and their character is retained as short-term and/or long-term. As of August 31, 2014, the Fund had no capital loss carryforwards for federal income tax purposes.
In accordance with accounting pronouncements, the Fund has recorded reclassifications in the capital accounts. These reclassifications have no impact on the net asset value of the Fund and are designed generally to present accumulated undistributed net investment income (loss) and accumulated realized gains/(losses) on a tax basis which is considered to be more informative to the shareholder. As of August 31, 2014, the Fund recorded reclassifications to increase (decrease) the capital accounts as follows:
| Net Investment Loss | Paid-in Capital |
| $ 18,761 | $ (18,761) |
There were no distributions paid by the Fund during the six month period ended February 28, 2015 or for the period since inception from October 10, 2014 through August 31, 2014.
| 8. | COMMITMENTS AND CONTINGENCIES |
In the normal course of business, the Trust may enter into contracts that may contain a variety of representations and warranties and provide general indemnifications. The Trust’s maximum exposure under these arrangements is dependent on future claims that may be made against the Fund and, therefore, cannot be estimated; however, management considers the risk of loss from such claims to be remote.
In accordance with GAAP, Management has evaluated the impact of all subsequent events on the Fund through the date the financial statements were issued, and has determined that there were no other subsequent events requiring recognition or disclosure in the financial statements.
| Winning Points Funds | SEMI-ANNUAL REPORT |
ADDITIONAL INFORMATION
February 28, 2015 (Unaudited)
The Fund files its complete schedule of portfolio holdings with the Securities and Exchange Commission (the “Commission”) for the first and third quarters of each fiscal year on Form N-Q. The Fund’s Forms N-Q are available on the Commission’s website at http://www.sec.gov. The Fund’s Forms N-Q may be reviewed and copied at the Commission’s Public Reference Room in Washington, DC. Information on the operation of the Commission’s Public Reference Room may be obtained by calling 1-800-SEC-0330.
A description of the policies and procedures that the Fund uses to determine how to vote proxies relating to portfolio securities is available without charge, upon request, by calling 1-877-244-6235; and on the Commission’s website at http://www.sec.gov.
Information regarding how the Fund voted proxies relating to portfolio securities during the most recent 12-month period ended June 30th is available without charge, upon request, by calling 1-877-244-6235; and on the Commission’s website at http://www.sec.gov.
Shareholder Tax Information - The Fund is required to advise you within 60 days of the Fund’s fiscal year end regarding the federal tax status of distributions received by shareholders during the fiscal year. The Fund did not pay any distributions during the six month period ended February 28, 2015.
Tax information is reported from the Fund’s fiscal year and not calendar year, therefore, shareholders should refer to their Form 1099-DIV or other tax information which will be mailed in 2016 to determine the calendar year amounts to be included on their 2015 tax returns. Shareholders should consult their own tax advisors.
| Winning Points Funds | SEMI-ANNUAL REPORT |
ADDITIONAL INFORMATION
February 28, 2015 (Unaudited)
BOARD OF TRUSTEES, OFFICERS AND PRINCIPAL SHAREHOLDERS - (Unaudited)
Remuneration Paid to Trustees and Officers - Officers of the Trust and Trustees who are “interested persons” of the Trust or the Adviser will receive no salary or fees from the Trust. Each Trustee who is not an “interested person” receives a fee of $1,000 each year plus $125 per Board or committee meeting attended in person and $100 per meeting attended by telephone. The Trust reimburses each Trustee and officer for his or her travel and other expenses relating to attendance at such meetings.
Name of Trustee1 | Aggregate Compensation From the Fund2 | Pension or Retirement Benefits Accrued As Part of Portfolio Expenses | Estimated Annual Benefits Upon Retirement | Total Compensation From the Fund Paid to Trustees2 |
| Independent Trustees |
| Art Falk | $1,000 | None | None | $1,000 |
| Thomas Krausz | $ 875 | None | None | $ 875 |
| Tom M. Wirtshafter | $ 875 | None | None | $ 875 |
| Gary DiCenzo | $ 750 | None | None | $ 750 |
| Interested Trustees and Officers |
| Randall K. Linscott | None | Not Applicable | Not Applicable | None |
| Robert S. Driessen | None | Not Applicable | Not Applicable | None |
| Brandon Byrd | None | Not Applicable | Not Applicable | None |
| Larry Beaver | None | Not Applicable | Not Applicable | None |
| Jeremiah Hierseman | None | Not Applicable | Not Applicable | None |
| 1 | Each of the Trustees serves as a Trustee to each Series of the Trust. The Trust currently offers fourteen (14) series of shares. |
| 2 | Figures are for the six month period ended February 28, 2015. |
| Winning Points Funds | SEMI-ANNUAL REPORT |
Information About Your Fund’s Expenses - (Unaudited)
As a shareholder of the Fund, you incur two types of costs: (1) transaction costs, such as the sales charge (load) imposed on certain subscriptions and the contingent deferred sales charge (“CDSC”) imposed on certain short-term redemptions; and (2) ongoing costs, including management fees, distribution and/or service (12b-1) fees; and other Fund expenses. The example below is intended to help you understand your ongoing costs (in dollars) of investing in the Fund and to compare these costs with the ongoing costs of investing in other mutual funds.
The example is based on an investment of $1,000 invested at the beginning of the period and held for the entire period as indicated below.
Actual Expenses – The first section of the table provides information about actual account values and actual expenses (relating to the example $1,000 investment made at the beginning of the period). You may use the information in this section, together with the amount you invested, to estimate the expenses that you paid over the period. Simply divide your account value by $1,000 (for example, an $8,600 account value divided by $1,000 = 8.6), then multiply the result by the number in the first section under the heading entitled “Expenses Paid During Period” to estimate the expenses you paid on your account during this period.
Hypothetical Example for Comparison Purposes – The second section of the table provides information about the hypothetical account values and hypothetical expenses based on the Fund’s actual expense ratio and an assumed rate of return of 5% per year before expenses, which is not the Fund’s actual return. The hypothetical account values and expenses may not be used to estimate the actual ending account balance or expenses you paid for the period. You may use this information to compare the ongoing costs of investing in the Fund to other funds. To do so, compare this 5% hypothetical example with the 5% hypothetical examples that appear in the shareholder reports of the other funds.
Please note that the expenses shown in the table are meant to highlight your ongoing costs only and do not reflect any transactional costs, such as sales charges (loads), CDSC fees, or exchange fees. Therefore, the second section of the table is useful in comparing ongoing costs only, and will not help you determine the relative total costs of owning different funds. In addition, if these transactional costs were included, your costs would have been higher. For more information on transactional costs, please refer to the Fund’s prospectus.
Expenses and Value of a $1,000 Investment for the period from 09/01/14 through 02/28/15
| | Beginning Account
Value (09/01/2014) | Annualized Expense
Ratio for the Period | Ending Account
Value (02/28/2015) | Expenses Paid
During Period (a) |
| Actual Fund Return (in parentheses) | | | |
| Institutional Class (-6.16%) | $1,000.00 | 2.84% | $938.40 | $13.65 |
| Hypothetical 5% Fund Return | | | |
| Institutional Class | $1,000.00 | 2.84% | $1,010.70 | $14.16 |
| (a) | Expenses are equal to the Funds’ annualized expense ratios, multiplied by the average account value over the period, multiplied by 181/365 to reflect the one-half year period. |
For more information on Fund expenses, please refer to the Fund’s prospectus, which can be obtained from your investment representative or by calling 1-877-244-6235. Please read it carefully before you invest or send money.
Total Fund operating expense ratios as stated in the current Fund prospectus dated December 31, 2014 for the Fund were as follows: |
| WP Large Cap Income Plus Fund Institutional Class shares | 3.38% |
Total Gross Operating Expenses (Annualized) during the six month period ended February 28, 2015 were 2.84% for the WP Large Cap Income Plus Fund Institutional Class shares. Please see the Information About Your Fund’s Expenses, the Financial Highlights and Notes to Financial Statements (Note 6) sections of this report for expense related disclosures during the six month period ended February 28, 2015. |
360 FUNDS 4520 Main Street Suite 1425 Kansas City, MO 64111
INVESTMENT ADVISER Winning Points Advisers, LLC 129 NW 13th Street Suite D-26 Boca Raton, FL 33431
ADMINISTRATOR & TRANSFER AGENT Matrix 360 Administration, LLC 4520 Main Street Suite 1425 Kansas City, MO 64111
DISTRIBUTOR Matrix Capital Group, Inc. 419 Lafayette Street New York, NY 10003 INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM Sanville & Company 1514 Old York Road Abington, PA 19001
LEGAL COUNSEL Graydon Head & Ritchey LLP 15 West Center Street Lawrenceburg, IN 47025
CUSTODIAN BANK Fifth Third Bank Fifth Third Center
38 Fountain Square Plaza
Cincinnati, OH 45263 |
Not applicable at this time.
Not applicable at this time.
Not applicable at this time.
Included in semi-annual report to shareholders filed under item 1 of this form.
Not applicable at this time.
Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment Company Act of 1940, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.
Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment Company Act of 1940, this report has been signed below by the following person on behalf of the registrant and in the capacities and on the date indicated.
Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment Company Act of 1940, this report has been signed below by the following person on behalf of the registrant and in the capacities and on the date indicated.
