Axonic Strategic Income Fund: 2025 Review and 2026 Outlook

FOR INSTITUTIONAL AND REGISTERED PROFESSIONAL USE ONLY. NOT FOR USE WITH A RETAIL AUDIENCE.

Mutual Fund investing involves risk. Principal loss is possible.

Opinions expressed are subject to change at any time, are not guaranteed and should not be considered investment advice.

An investor should consider the investment objectives, risks, charges, and expenses of the Fund carefully before investing. To obtain a prospectus containing this and other information, please call (212) 259-0430 or download the file from www.AxonicFunds.com. Please read the prospectus carefully before you invest.

Definitions

• 30-Day SEC Yield is an annualized yield based on the most recent 30-day period. Subsidized yields reflect fee waivers in effect. Without such waivers in effect, yields would be reduced. Unsubsidized yields do not reflect fee waivers in effect.
• Bloomberg US Aggregate Bond Index/Bloomberg–Index LBUSTRUU is a broad-based benchmark that measures the investment grade, U.S. dollar-denominated, fixed-rate taxable bond market.
• Asset Backed Securities (ABS) are a financial security collateralized by a pool of assets such as loans, leases, credit card debt, royalties or receivables.
• Cash-Flow Generating Assets typically return either a principal and/or interest component on a regular, consistent basis.
• Commercial Real Estate (CRE) is non-residential property that serves to generate income.
• Commercial Mortgage-Backed Securities (CMBS) are secured by mortgages on commercial properties rather than on residential real estate.
• Distribution Rate are distributions from the Fund’s net investment income which are accrued daily and typically paid monthly. The distribution rate is expressed as a percentage equal to annualizing actual dividends distributed for the monthly period ended on the date shown and dividing by the net asset value on the last business day for the same period and then averaging the resulting rates over the past 12 months. However, there can be no assurances that the Fund will achieve any level of distribution to its Shareholders. The Fund intends to make sufficient distributions of its ordinary taxable income and capital gain net income prior to the end of each calendar year to avoid liability for the excise tax. The character of income and gains to be distributed is determined in accordance with income tax regulations, which may differ from Generally Accepted Accounting Principles.
• Non-Agency Residential Mortgage-Backed Securities (Non-Agency RMBS) are a form of debt-based securities which are backed by the principal and interest payments on loans for residences.
• Real Estate Investment Trusts (REIT) are companies that own, operate, or finance income-generating real estate.
• Residential Mortgage-Backed Securities (RMBS) are a form of debt-based securities which are backed by the principal and interest payments on loans for residences.  There are two types of residential mortgage-backed securities: agency or non-agency (see above for non-agency definition).  Agency RMBS are created by one of three agencies. These are Government National Mortgage Association (GNMA or Ginnie Mae), Federal National Mortgage (FNMA or Fannie Mae), and Federal Home Loan Mortgage Corp. (Freddie Mac).
• Structured Credit applies broadly to the asset class associated with pooling debt obligations into channels which can then be distributed to different risk appetites.
• Weighted Average Life (WAL) is the average number of years for which each dollar of unpaid principal on a loan, a mortgage, or an amortizing bond remains outstanding. The measure takes into account Axonic Capital’s assumptions for prepayment speeds and exercise of options.
• Weighted Average Price calculation excludes any assets without a stated coupon or allocated principal
• Yield is the income returned on an investment. The measure may take into account Axonic Capital’s assumptions for prepayment speeds, default probability and loss given default.
• Yield to Maturity (YTM) is the total return of a bond if it makes all expected principal and interest payments while being held until maturity
• Yield to Worst (YTW) is the yield for a bond under duress scenarios that operates within its contract terms without the issuer defaulting.

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