Loomis Sayles | Institutional | Strategic Alpha Fund

Effective 9/28/12, the Fund, formerly known as Absolute Strategies, changed its name.
Y shares are only available to certain institutional investors. Please click here for other share classes.

The Strategic Alpha Fund seeks to provide an attractive absolute total return, complemented by prudent investment management designed to manage risks and protect investor capital. The secondary goal of the Fund is to achieve these returns with relatively low volatility

Primary Benchmark:

MLBoA US Dollar LIBOR 3-month Constant Maturity

Portfolio Management

Matt Eagan, CFA
Kevin Kearns
Todd Vandam, CFA

Total Fund Assets (as of 4/30/2013):

$1.0 billion

Lipper Category:

Absolute Return category

Morningstar Category:

Nontraditional Bond

Strategy Highlights

The strategy combines the features of a traditional bond fund and an alternative investment to create an all-weather solution.
Unconstrained by market benchmarks, this absolute return oriented strategy has the flexibility to invest in opportunities across the global fixed income landscape, as well as use derivative instruments. This mobility enables the team to respond tactically to shifting economic environments and market events.
The strategy targets risk levels between 4% and 6%* to help dampen volatility and to help hedge against global events that influence fixed-income markets.

*Although the fund actively manages risk for a 4% to 6% standard deviation level, there is no guarantee that the fund will always maintain its targeted risk level.

Investment Strategy

Portfolio average duration may range between -2 to 5 years
Total long or short exposure will not exceed 100% short & 100% long on a notional basis*
May invest up to 50% of net exposure in non-dollar currency
May invest up to 20% of net exposure in emerging markets currency
May invest up to 50% of net exposure in below investment grade, fixed income securities

*Limits shown are net long or short as a % of total long exposure and exclude the use of futures and related options.

About Risk

Non-diversified funds that may focus on a relatively small number of stocks/issuers tend to be more volatile than diversified funds and the market as a whole
Absolute return funds tend to underperform during periods of strong positive market performance
Mutual funds that invest in bonds can lose their value. When interest rates rise, bond prices usually fall and vice versa. Credit risk (the risk that the issuer or borrower will fail to make timely payments of interest and/or principal) is heightened for lower rated or higher yielding fixed-income securities and lower rated borrowers. In addition, lower-rated debt securities may be subject to greater price volatility
Below investment-grade (also known as high yield) securities are subject to a high degree of market and credit risk. In addition, the secondary market for these securities may lack liquidity, which in turn may adversely affect the value of these securities and that of the Fund
Derivatives (which include, but are not limited to, futures, forward contracts, options, and swaps) generally have implied leverage (a small amount of money to make an investment of greater value). Because of this, the fund’s use of derivatives may magnify any gains or losses on those investments, as well as risk to the fund. Over the Counter (OTC) derivative contracts involve counterparty risk, or the risk of default to a derivative contract, and liquidity risk; market volatility may prevent the fund from closing out contracts at the desired time and price
The Fund is subject to currency risk, the risk of fluctuations in exchange rates between the US dollar and foreign currencies, which may cause the value of a Fund’s investments to decline
Stock values fluctuate and are subject to unpredictable declines due to the activities of individual companies, economic conditions and general market conditions

Past performance is no guarantee of future results.

¹ For further detail regarding Minimum Initial Investment, please see the fund prospectus.

² Unlike net expense ratio, gross expense ratio does not reflect any potential reimbursement/waiver of expenses, if any, as stated in the most recent Fund prospectus. Fund expenses and expense reductions are subject to change. Expense reductions are contractual; Class Y shares are set to expire 4/30/2014. Investors should consult the most recent prospectus for more detailed information.

LIBOR stands for London Interbank Offered Rate, the rate of interest at which banks offer to lend money to one another. It is a standard financial index used in US capital markets. Indexes are unmanaged and do not incur fees. It is not possible to invest directly in an index.

Primary Benchmark: MLBoA US Dollar LIBOR 3-month Constant Maturity

Year-to-Date Performance as of 5/24/2013

	Class Y
	3.59%

Month-End Performance as of 4/30/2013

Cumulative Total Return	Class Y	Index
3 month	1.40%	0.08%
Year-to-date	3.39%	0.10%

Average Annualized Total Return	Class Y	Index
1 Year	10.28%	0.41%
Since Inception (12/15/2010)	5.07%	0.38%

Quarter-End Performance as of 3/31/2013

Cumulative Total Return	Class Y	Index
3 month	2.21%	0.08%
Year-to-date	2.21%	0.08%

Average Annualized Total Return	Class Y	Index
1 Year	9.01%	0.43%
Since Inception (12/15/2010)	4.73%	0.38%

Gross Expense Ratio: (Y) 0.87%; Net Expense Ratio: (Y) 0.87% Waivers/reimbursements are contractual and are set to expire 4/30/14.

Lipper Rankings as of 4/30/2013

	Class Y
1 Year	26/309
3 Years	N/A
5 Years	N/A
10 Years	N/A
Lipper Category: Absolute Return category

Morningstar Rankings as of 3/31/2013

	Class Y
1 Year	29/199
3 Years	N/A
5 Years	N/A
10 Years	N/A
Morningstar Category: Nontraditional Bond

Lipper and Morningstar rankings are based on total returns calculated by each ranking entity. Rankings do not take into account sales charges, if applicable, but include reinvestment of dividends and capital gains, if any.

Performance data quoted represents past performance and is no guarantee of future results. Total return and value will vary and you may have a gain or loss when shares are sold. Current performance may be lower or higher than quoted. Returns include changes in share price and reinvestment of dividends and capital gains, if any.

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Ticker	LASYX
Class Inception	12/15/2010
CUSIP	63872T620
Minimum Initial Investment¹	$100,000
Gross Expense Ratio²	0.87%
Net Expense Ratio²	0.87%
Net Asset Value as of 4/30/2013	10.48
Fact Sheet Commentary Application Prospectus Report