[SRSY LOGO] 2600 One Commerce Square Philadelphia, PA 19103-7098 T: (215) 564-8099 F: (215) 564-8120 September 6, 2006 Via EDGAR and E-mail Linda Stirling U.S. Securities and Exchange Commission Division of Investment Management 100 F Street, N.E. Washington, D.C. 20549 Re: Quaker Investment Trust File Nos. 033-38074 and 811-06260 Dear Ms. Stirling: On behalf of the Quaker Investment Trust (the "Registrant"), the following are our responses to the comments of the staff (the "Staff") of the U.S. Securities and Exchange Commission (the "SEC") conveyed with respect to Post-Effective Amendment No. 35 to the Registrant's Registration Statement on Form N-1A, which was filed on June 28, 2006 pursuant to Rule 485(a) under the Securities Act of 1933, as amended, to register a new series, the Quaker Global Growth Fund (the "Fund"). Each Staff comment is summarized below, followed by the Registrant's response to the comment. 1. Comment. In the second bullet point under the "Principal Investment Strategy" section of the Fund's prospectus, identify the methodology that the Fund's sub-adviser will use to identify companies that have a probability for superior growth prospects. Response. The Registrant will add the following disclosure at the end of the second bullet under the "Principal Investment Strategy" section: "The Fund's sub-adviser seeks to identify such companies by using a "bottom up" approach, i.e., by focusing on individual companies rather than on short-term movements in broad economic factors, such as interest rates or commodity prices." 2. Comment. The fourth bullet point under the "Principal Investment Strategy" section of the Fund's prospectus states that the Fund may invest up to 50% of its total assets in special situations. Under the "Principal Risks" section of the prospectus, it states that the Fund may invest up to 25% of its total net assets in special situations. Clarify to what extent the Fund may invest in special situations, and whether such percentage limitation is based on total or net assets. Response. The actual limitation on the Fund's investments in special situations will be 20% of its total assets. The disclosure in the "Principal Investment Strategy" and "Principal Risks" sections of the Fund's prospectus will be revised accordingly. 3. Comment. Under the "Principal Risks" section of the Fund's prospectus, explain that one of the risks of portfolio turnover is higher costs. Response. The portfolio turnover risk disclosure will be revised as follows: The Fund's portfolio manager may engage in aggressive portfolio trading. As a result, the Fund could experience higher than average portfolio turnover. A high rate of portfolio turnover in any year may increase brokerage commissions paid and could generate greater taxes for shareholders on realized investment gains. 4. Comment. The liquidity risk disclosure under the "Principal Risks" section of the Fund's prospectus states that the Fund will not invest more than 10% of its net assets in illiquid securities. Does the 10% limitation include investments in special situations? Response. As previously noted, the Fund may not invest more than 20% of its total assets in special situation investments; however, not all special situation investments will involve illiquid securities. To the extent such investments involve securities that cannot readily be sold within seven days at approximately the price at which they are valued, they will be considered illiquid and fall within the Fund's illiquid securities limitation. 5. Comment. The expense examples are not consistent with the stated ratios in the fee table. Provide the correct expense example numbers. Response. The expense examples will be revised as indicated below: If you redeem your shares at the end of the period, your expenses for investing in the Fund would be: One Year Three Years Class A $793 $1,297 Class C $432 $1,013 If you did not redeem your shares at the end of the period, your expenses for investing in the Fund would be: One Year Three Years Class A $793 $1,297 Class C $332 $1,013 6. Comment. If the Registrant believes that the Fund's portfolio turnover will significantly exceed 100% annually, the disclosure under the "Portfolio Turnover" section should be revised. Response. Until the Fund commences operations and the sub-adviser begins managing the Fund's portfolio, the Registrant cannot predict whether the Fund's annual portfolio turnover rate will significantly exceed 100% annually. As a result, the Registrant intends to leave the current disclosure unchanged, but will monitor the Fund's portfolio turnover once it commences operations and will revise the prospectus disclosure as necessary if the portfolio turnover rate significantly exceeds 100%. 7. Comment. Under the "Management of the Fund" section of the Fund's prospectus, provide more detailed information about the portfolio managers' business experience during the past five years as required by Item 5(a)(2) of Form N-1A. Response. The "Sub-Adviser and Portfolio Managers" section of the Fund's prospectus will be revised as follows: Manu Daftary and Chris Perras are primarily responsible for the day-to-day management of the Fund. Messrs. Daftary and Perras have been the Fund's portfolio managers since its inception. Mr. Daftary has primary responsibility for the investments of the Fund and has final authority over all aspects of the Fund's investment portfolio, including but not limited to, purchase and sale of individual securities, portfolio risk assessment, and the management of daily cash balances in accordance with anticipated management requirements. Mr. Perras provides research and advice on the purchase and sale of individual securities, and portfolio risk assessment. Manu Daftary, CFA-- President and Chief Investment Officer of DG Capital. Mr. Daftary founded DG Capital in 1996. Prior to founding DG Capital, he served as a portfolio manager at several investment management firms. Mr. Daftary holds a BA in economics from the University of Mumbai, India and a BS and MBA from California State University at Long Beach. He is a Chartered Financial Analyst. Chris Perras, CFA-- Portfolio Manager. Mr. Perras joined DG Capital in June 2002. From April 1999 to June 2002, Mr. Perras was part of a management team at AIM Capital Management that was responsible for the AIM Opportunities Long/ Short funds and AIM's hedge fund products. He received a BS in electrical engineering from the Georgia Institute of Technology and a MBA from Harvard Graduate School of Business Administration. He is a Chartered Financial Analyst. 8. Comment. Why is there different disclosure with respect to the valuation of individual securities and foreign securities under the "Fair Valuation" section of the prospectus? Is there a different process for fair valuing foreign securities? Response. The Registrant has included additional disclosure about the valuation of foreign securities to explain that the foreign securities held by the Fund may be valued before the close of the foreign exchange on which they are traded because the New York Stock Exchange ("NYSE") closes prior to the foreign exchange's closing time. An additional purpose for including the foreign securities fair valuation disclosure is to explain that a foreign security's value is converted into U.S. dollars based on the applicable foreign exchange rate. However, to the extent that a foreign security must be fair valued, the Registrant's Valuation Committee uses the same process for valuing domestic and foreign securities. Accordingly, the Fund's foreign securities fair valuation disclosure will be revised as follows to clarify that this is the Fund's practice: Foreign Securities. The value of a foreign security is generally determined as of the close of trading on the foreign stock exchange on which the security is primarily traded, or as of the close of trading on the NYSE, if earlier. The value is then converted into its U.S. dollar equivalent at the foreign exchange rate in effect at the close of the NYSE (generally 4:00 p.m. Eastern time) on the day that the value of the foreign security is determined. If no sale is reported at that time, the foreign security will be valued within the range of the most recent quoted bid and ask prices. If a market quotation is not readily available for a foreign security or an event has occurred that has caused a quotation to be unavailable or unreliable, the Valuation Committee will fair value foreign securities using the procedures described above. 9. Comment. On the back cover of the Fund's prospectus under "How To Get More Information, it states that additional information about the Fund is available in the Trust's latest annual report dated June 30, 2006. However, the Fund will not be effective or commence operations until after June 30, 2006. Revise the disclosure accordingly. Response. The disclosure will be revised as follows: "Additional information about the Fund is available in the Trust's latest Audited Annual Report dated December 31, 2006, and its Statement of Additional Information." * * * Please do not hesitate to contact me at the above number if you have any questions or wish to discuss any of the responses presented above. Sincerely yours, /s/Jonathan M. Kopcsik Jonathan M. Kopcsik cc: Timothy Richards, Esq. Alan Gedrich, Esq.
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Quaker Investment Trust CORRESPCorrespondence with SEC
Filed: 6 Sep 06, 12:00am