Frequently Asked Questions
Who is Giant 5 Funds?
Giant 5 Funds is a Mutual Fund Trust Company headquartered in Colorado at the foot of America's Mountain, Pikes Peak. We are a Registered Investment Company (RIC) with two no-load mutual funds listed on the NASDAQ: Giant 5 Total Investment System (FIVEX) and Giant 5 Total Index System (INDEX).
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Who is The Investment Adviser?
The Willis Group is the Investment Adviser for Giant 5 Funds. Michael G. Willis is the lead portfolio manager.
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What is your Company Culture?
Giant 5 Funds is a company where the best idea wins, bureaucrats are unwelcome, performance is recognized, and we never stop improving. We hire the smartest people we can find and free them to do what they are best at. Our team members create positive environments wherever they go and they always look for ways to improve everything around them.
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Who is The Custodian of Assets?
UMB Bank, n.a. is the custodian for Giant 5 Funds. www.umb.com
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What does Giant 5 Funds do?
Giant 5 Funds frees people to live Giant Lives. Our offer is unique in the mutual fund industry.
- Investment System: We provide our shareholders with a Total Investment System designed to perform in all markets.
- Shareholder Focus: We provide our shareholders with an independent no-load platform that eliminates the need for financial salesmen and their potentially biased advice.
- Asset Allocation: We invest in the 5 Essential Themes, and we invest in them equally.**
- Access: We provide our shareholders entrance to institutional funds that they would otherwise likely be unable to invest in due to the multi-million dollar investment minimums.
- Diversification & Simplicity: We provide our shareholders access to the managers we believe are the best in the world (or index funds and ETFs) in one ticker symbol: FIVEX or INDEX.
**The Fund will generally invest in these themes in substantially equal 20% portions over time. However, asset allocation may varies based on availability and rebalancing criteria.
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Why do you do it?
We want to hand control of the industry back to the individual investor. We created Giant 5 Funds for investors who are tired of excessive fees and financial salesmen who add no real long-term value to the performance of their investments. Our shareholders recognize that short-term trading can become a sophisticated form of gambling, not only wasting their savings but ultimately robbing them of the most valuable asset they have... their time.
We believe that fees and commissions paid by investors to financial salesmen are sometimes lost on human intuition that is incapable of helping them in the long-run. Even if you do find an independent voice who places your interests above their own, it doesn't change the fact that no one on Wall Street actually knows what the future holds and knows where next year's top performance will come from. Your life shouldn't be spent chasing "the next great investment" on Wall Street while a Giant Life passes you by.
We simplify: Own the 5 Essential Themes and own them Equally** - Real Estate, Raw Materials, Energy, Capital Markets, and Bonds. Give yourself potential to perform in all market conditions. Use a global investment strategy which utilizes the talents of the managers we believe are the best in the world, irrespective of what firm they work for, who all have one focus in mind - you. Giant 5 Funds has made this possible with the Total Investment System (FIVEX).
**The Fund will generally invest in these themes in substantially equal 20% portions over time. However, asset allocation may varies based on availability and rebalancing criteria.
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Why should I choose Giant 5 Funds?
Freedom. Simplicity.
Giant 5 Funds provides you the opportunity for performance in all markets with a globally diversified, mathematically based, invest where you spend, salesman free, no-load mutual fund that is managed from an independent platform, giving you access to 25 mutual funds and their managers under one time-saving ticker: FIVEX.
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What is a Giant Life?
A Giant Life starts with knowing who you are and why you are here. It's choosing something bigger than you and being dedicated to seeing it succeed. A Giant Life is discovering that unique talent or ability that you have and using it to better yourself and the world. To do this, we believe that you have to reserve your time and your money for the things you value in life the most. Here are 5 Financial Aspects of a Giant Life:
- Time: Recognize time as your most valuable asset and protect it at all costs. Invest it where it will provide the best Return on Life. Therefore, simplify. Complexity consumes your time. Simplicity saves you time.
- Happiness: Appreciate what money can do for you, but realize that it cannot buy you happiness. Use money to do the things you love. Use money to help the causes you love and the people you love - your family, your friends, and your community.
- Freedom: Financial integrity is financial freedom. Spend less than you earn and learn to save. Excessive spending and debt undermines financial freedom and can destroy everything you've worked for. Likewise, Wall Street gambling and excessive financial risk undermines financial freedom. Diversification, asset allocation, and a long-term plan protect your financial freedom.
- Independence: Take back control of your financial world. Assert your independence from Wall Street and Financial Salesmen. Let go of the stress and complexity.
- Wisdom: Calm, prudent investing helps protect your future against the influences of fear and greed. The foundations of the global investment world are rooted in common sense and simplicity. Own the 5 Essential Themes and own them Equally**.
**The Fund will generally invest in these themes in substantially equal 20% portions over time. However, asset allocation may varies based on availability and rebalancing criteria.
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What is my Unique Ability and why do you talk about it?
At Giant 5 Funds, we believe that everyone is intrinsically significant. Each of us has a unique talent or ability that sets us apart from everyone else. This ability uniquely defines you in the universe. It is what you are best at and enjoy doing the most. If you find a way to consistently use your unique ability, we believe your mark on your world will be Giant. You'll make the world a better place. We want to free people to do this.
The sad reality is that "the clutter of life" can keep us from ever using our unique ability or from even discovering what it is. For many, their financial world can become the single greatest distraction to using their unique ability and living a Giant Life. Giant 5 Funds intends to free you from the financial stress and the worries of Wall Street so that you can focus on doing what you were born to do.
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What is the difference between FIVEX and INDEX?
The Total Investment System (FIVEX) is comprised of underlying mutual funds. The Total Index System (INDEX) is comprised of index funds and Exchange Traded Funds (ETFs).
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How do you rebalance the portfolio?
Our rebalancing is based on math - not human intuition or a calendar. The formula is tied to the performance of each Essential Theme and is designed to keep the portfolio from becoming over-concentrated in any one Theme.
The Fund will generally invest in these Themes in substantially equal 20% portions over time. As one Theme outperforms another over time (increasing the portion of the Fund's portfolio invested in such Theme), the Fund's adviser will rotate money from the outperforming Themes into the under performing Themes.
This rebalancing is our way to "sell high and buy low". It is designed to allow the Fund to benefit from the growth of a "bubble" (when one Theme takes off) but to protect the Fund (by rebalancing) from the inevitable "pop" that comes when one Theme is overvalued - for example, when the technology industry bubble popped in 2000-2002.
This rebalancing ensures that the Fund is always invested in each of the 5 Essential Themes, even when human emotions might tell you otherwise. Our conclusion is that the 5 Essential Themes - the foundational building blocks of the global investment world - should be held at all times, as no one knows which Theme will be the top performer next year and human intuition is historically inaccurate.
For more details, see the Giant 5 Total Index System, Investment Objective, Policies and Strategy section of the Prospectus.
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Do you invest globally?
The Fund will attempt to gain up to 50% international exposure within each of the 5 Essential Themes, when such opportunities exist at the discretion of the adviser*****.
*****Investments in foreign securities are subject to greater volatility due to such factors as changes in currency rates, foreign taxation, differences in auditing and other financial standards.
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What is Pocketbook Investing?
Pocketbook Investing is investing where you spend. Giant 5 Funds has identified the places where Americans and the world are spending their money. You will likely find these same recurring themes, which we call the 5 Essential Themes, in your own budget. They affect your pocketbook and the world's pocketbook today and tomorrow:
Real Estate: where you live, work, shop and play
Raw Materials: what civilizations are built with and what you eat
Energy: what makes everything run and what keeps you warm
Capital Markets : global stocks of all sizes and styles
Bonds: where corporations and governments borrow your money and pay you a set interest rate
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What is a fund of funds?
Instead of purchasing individual stocks and bonds, a fund of funds selects, purchases, and sells mutual funds. Literally, a fund of funds is a mutual fund of mutual funds.
We believe mutual funds represent an improved investment to individual stocks because of the added stability brought by the fund's diversification. However, there are now over 20,000 mutual funds available in the market. Our 39-Step Selection Process is designed to identify the mutual funds we believe are the best in the world in each of the 5 Essential Themes and provide our shareholders with an accessible solution for one of the most challenging tasks of investing: fund selection and portfolio management.
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When does Giant 5 Funds sell an underlying mutual fund?
We continuously monitor all the funds in our portfolio to ensure that they continually maintain our strict standards. Material change in any of the 39 criteria we use to screen managers and their funds can trigger the sale of that fund. For example, if the manager is bought out by another fund (as frequently happens), that is potential grounds to sell the fund. Conversely, if the holdings of the underlying fund no longer adequately represented one of the 5 Essential Themes, this could also be grounds to sell the fund.
Rebalancing will also trigger the sale of a fund. The Fund will generally invest its assets in the Themes in substantially equal 20% portions over time. As one Theme outperforms another over time, an increased portion of the fund will be invested in the better performing Theme. However, the Fund's Investment Adviser will rotate money from the outperforming Theme into the under performing Themes when the mathematical spread reaches a proprietary limit that keeps the portfolio proportionally balanced. For more details, see Giant 5 Total Index System, Investment Objective, Policies and Strategy section of the Prospectus (pages 18-21).
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When I buy or sell, will I receive confirmation?
Confirmations will be mailed within 5 business days of your purchase/sale.
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When do I receive statements?
Giant 5 Funds statements will be provided on a quarterly basis.
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Can I receive everything electronically?
Yes. Call Customer Service at 1-888-5GIANT5.
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Who regulates Giant 5 Funds?
Giant 5 Funds is regulated by the Security and Exchange Commission (www.sec.gov) and the National Association of Securities Dealers (FINRA - www.finra.org). An independent annual audit is conducted by Cohen McCurdy (www.cohenmccurdy.com), and Cohen McCurdy reports their findings directly to the shareholders. The Investment Adviser is accountable to the SEC, the NASD, the Chief Compliance Officer of Giant 5 Funds, and an independent Board of Trustees.
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What is an index ?
Essentially, an index*** is a statistical measure of change in an economy or a securities market. In the case of financial markets, an index is essentially an imaginary portfolio of securities representing a particular market or a portion of it.
For people who fundamentally believe that indexes outperform managers over time, we have created the Total Index System (INDEX), utilizing the same investment philosophy as the Total Investment System (FIVEX) but building the mutual fund with index funds and ETFs. Indexes are unmanaged and one cannot invest directly in an index or a portion of it.
*** WWW "Index." 2006. http://investopedia.com/terms/i/index.asp
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Has it been proven that indexes beat managers over time?
Many investors are convinced this is true. And for these shareholders we have designed The Total Index System (INDEX).
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Aren't all math-based trading systems proved wrong over time?
Although investment fads come and go, there are some fundamental truths of prudent investing that have withstood the test of time and the laws of human nature. Modern Portfolio Theory**** states that 93% of all performance comes from the asset allocation of the portfolio. The remaining 7% comes from trading, stock selection, and other factors. Our Total Investment System is designed to give you access to both worlds: math-based asset allocation (Own the 5 Essential Themes...and own them Equally**), and our underlying fund managers for the remaining 7%.
**** Modern Portfolio Theory is based on Harry Markovitz's "Portfolio Selection," published by the Journal of Finance in 1952.
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Who is the Fund Administrator and Transfer Agent?
UMB Fund Services, Inc. is the fund administrator and transfer agent for Giant 5 Funds: www.umb.com.
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What do you mean "Own Them Equally?
The Fund will generally invest in the 5 Essential Themes in substantially equal 20% portions over time. However, the amount of the Fund's assets invested in the Themes will vary and there is no limit to the amount of Fund's assets that may be invested in a particular Theme. Due to the current low availability of Raw Material funds, the Investment Adviser reserves the right to combine the Raw Materials and Energy Themes for asset allocation and rebalancing purposes, until such time that Raw Material funds become sufficiently available again.
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Can I wire my investments?
Yes. Here are the wiring instructions. If you need further assistance, please call 1.888.544.2685
Adding to an Existing Account - Send your investment to:
UMB Bank, n.a.
ABA#: 101000695
For credit to the Giant 5 Funds
A/C#: 9871691675
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Footnotes
**The Fund will generally invest in these themes in substantially equal 20% portions over time. However, asset allocation may varies based on availability and rebalancing criteria.
*** WWW "Index." 2006. http://investopedia.com/terms/i/index.asp
**** Modern Portfolio Theory is based on Harry Markovitz's "Portfolio Selection," published by the Journal of Finance in 1952.
*****Investments in foreign securities are subject to greater volatility due to such factors as changes in currency rates, foreign taxation, differences in auditing and other financial standards.
