The Fund is very different from most mutual funds in that it seeks to provide leveraged investment results on a
daily basis. The pursuit of such investment goal has the following implications:
The Fund is riskier than alternatives that do not use
leverage because the performance of an investment in the Fund is magnified. The effect of leverage on the Fund will generally cause the Funds performance to not match the performance of the Funds benchmark over a period of time greater
than one day. This means that the return of the Fund for a period of longer than a single trading day will be the result of each days compounded returns over the period, which will very likely differ from the return of the Funds
benchmark stated in the Funds investment objective for that period. As a consequence, especially in periods of market volatility, the path or trend of the benchmark during the longer period may be at least as important to the Funds
cumulative return for the longer period as the cumulative return of the benchmark for the relevant longer period. Further, the return for investors who invest for a period longer than a single trading day will not be the product of the return of the
Funds stated investment goal (
e.g.
, 2x) and the cumulative performance of the Funds benchmark.
The risk of the Fund
not achieving its daily investment objective will be more acute when the underlying index has an extreme one-day movement approaching 50%. In addition, as a result of compounding, the Funds performance for periods greater than one day is
likely to be either greater than or less than the performance of the underlying index times the stated multiple in the Funds investment objective (
e.g.,
2x), before accounting for fees and fund expenses.
The Fund is not suitable for all investors and is designed to be utilized only by sophisticated investors who (a) understand the risks associated
with the use of leverage, (b) understand the consequences of seeking daily leveraged investment results, and (c) intend to actively monitor and manage their investments. Investors who do not understand the Fund or do not intend to actively manage
and monitor their investments should not buy shares of the Fund.
There is no assurance that the Fund will achieve its objective and an
investment in the Fund could lose money. The Fund is not a complete investment program.
Before you invest, you may wish to review
the Funds Prospectus, which contains more information about the Fund and its risks. You may obtain the Prospectus and other information about the Fund, including the Statement of Additional Information (SAI) and most recent reports to
shareholders, at no cost by visiting http://guggenheiminvestments.com/services/prospectuses-and-reports, calling 800.820.0888 or
e-mailing
services@guggenheiminvestements.com. The Funds Prospectus and
SAI, both dated August 1, 2013, as revised from time to time, and the Funds most recent shareholder reports, are incorporated by reference into this Summary Prospectus.
SUMSDXH-0813x0814
Strengthening Dollar 2x Strategy Fund
IMPORTANT INFORMATION ABOUT THE FUND
The Strengthening Dollar 2x Strategy Fund (the Fund) is very different from most other mutual funds in that it seeks
daily
leveraged
investment results. As a result, the Fund may be riskier than alternatives that do not use leverage because the performance of an investment in the Fund is magnified.
The effect of leverage on the Fund will generally cause the Funds performance to not match the performance of the Funds benchmark (as described below) over a period of time greater than
one day. This means that the return of the Fund for a period of longer than a single trading day will be the result of each days compounded returns over the period, which will very likely differ from twice the return of the Funds
underlying index (as defined below) for that period. As a consequence, especially in periods of market volatility, the path or trend of the benchmark during the longer period may be at least as important to the Funds cumulative return for the
longer period as the cumulative return of the benchmark for the relevant longer period. Further, the return for investors who invest for a period longer than a single trading day will not be the product of the return of the Funds stated
investment goal (
e.g.
, 2x) and the cumulative performance of the underlying index (as defined below).
The Fund is not suitable
for all investors.
The Fund should be utilized only by investors who (a) understand the risks associated with the use of leverage, (b) understand the consequences of seeking daily leveraged investment results, and (c) intend
to actively monitor and manage their investments. Investors who do not meet these criteria should not buy shares of the Fund. An investment in the Fund is not a complete investment program.
INVESTMENT OBJECTIVE
The Fund seeks to provide investment results that match the performance of a specific benchmark, before fees and expenses, on a
daily basis. The Funds current benchmark is 200% of the performance of the U.S. Dollar Index
®
(the underlying index). The Fund does not seek to achieve its investment objective over a period of time greater than one day.
FEES AND
EXPENSES OF THE FUND
This table describes the fees and expenses that you may pay if you buy and hold H-Class Shares of the Fund.
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SHAREHOLDER FEES
(fees paid directly from
your investment)
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N/A
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ANNUAL FUND OPERATING EXPENSES
(expenses that you pay each year as a percentage of the value of your
investment)
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Management Fees
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0.90%
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Distribution (12b-1) Fees
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0.25%
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Other Expenses
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0.51%
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Total Annual Fund Operating Expenses
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1.66%
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EXAMPLE
This Example is intended to help you compare the cost of investing in the Fund with the cost of investing in other mutual funds.
The Example assumes that you invest $10,000 in the Fund for the time periods indicated, and then redeem all of your shares at the end of those
periods. The Example also assumes that your investment has a 5% return each year and that the Funds operating expenses remain the same. Although your actual costs may be higher or lower, based on these assumptions your costs would be:
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1 Year
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3 Years
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5 Years
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10 Years
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$
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169
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$
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523
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$
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902
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$
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1,965
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PORTFOLIO TURNOVER
The Fund pays transaction costs, such as commissions, when it buys and sells securities (or turns over its portfolio). A higher portfolio turnover rate may indicate higher transaction
costs and may result in higher taxes when Fund shares are held in a taxable account. These costs, which are not reflected in Total Annual Fund Operating Expenses or in the Example, affect the Funds performance. During the most recent fiscal
year, the Funds portfolio turnover rate was 0% of the average value of its portfolio. The Funds portfolio turnover rate is calculated without regard to cash instruments or derivatives. If such instruments were included, the Funds
portfolio turnover rate might be significantly higher.
PRINCIPAL INVESTMENT STRATEGIES
The Fund employs as its investment strategy a program of investing in derivative instruments, which primarily consist of equity index swaps, futures contracts, and options on securities, securities
indices, and futures contracts. Investing in derivative instruments enables the Fund to pursue its investment objective without investing directly in the securities included in the underlying index or in the same proportion that those securities are
represented in the underlying index. The Funds use of derivatives and the leveraged investment exposure created by such use are expected to be significant. Certain of the Funds derivative investments may be traded in the over-the-counter
(OTC) market, which generally provides for less transparency than exchange-traded derivative instruments. The U.S. Dollar Index
®
measures the performance of the U.S. dollar against a basket of foreign currencies that include the Euro, Japanese Yen, British Pound, Canadian Dollar, Swedish Krona
and Swiss Franc. On a day-to-day basis, the Fund may hold U.S. government securities or cash equivalents to collateralize its derivative positions. The Fund also may enter into repurchase agreements with counterparties that are deemed to present
acceptable credit risks. In an effort to ensure that the Fund is fully invested on a day-to-day basis, the Fund may conduct any necessary trading activity at or just prior to the close of the U.S. financial markets. The Fund is non-diversified and,
therefore, may invest a greater percentage of its assets in a particular issuer in comparison to a diversified fund.
PRINCIPAL RISKS
As with all mutual funds, a shareholder is subject to the risk that his or her investment could lose money. In addition to this risk, the Fund is
subject to a number of additional risks that may affect the value of its shares, including:
Active Trading Risk
Active
trading, also called high portfolio turnover, may result in higher brokerage costs or mark-up charges, which may negatively affect Fund performance. High portfolio turnover may also result in high levels of short-term capital gains,
which are generally taxable as ordinary income when distributed to shareholders. Large movements of assets into and out of the Fund due to active trading also may adversely affect the Funds ability to achieve its investment objective.
CFTC Regulatory Risk
The Commodity Futures Trading Commission (CFTC) has recently adopted amendments to certain
CFTC rules, and is in the process of promulgating new rules, that will subject the Fund and the Advisor to certain CFTC disclosure, reporting, and recordkeeping requirements if the Fund does not operate within certain derivatives trading and
marketing limitations. Compliance with these additional requirements will likely increase Fund expenses and may adversely affect the Funds ability to obtain exposure to certain investments and the commodities market generally. Certain of the
regulatory requirements that would apply to the Fund have not yet been adopted, and it is unclear what the effect of those requirements would be on the Fund if they are adopted. Consistent with the Funds investment strategies and investment
policies, the Advisor intends to maintain the flexibility to utilize certain derivatives beyond the CFTCs new trading limitations and to comply with CFTC rules to the extent required to maintain such investment flexibility.
Correlation and Compounding Risk
A number of factors may affect the Funds ability to achieve a high degree of correlation with its
benchmark, and there can be no guarantee that the Fund will achieve a high degree of correlation. Failure to achieve a high degree of correlation may prevent the Fund from achieving its investment objective. The risk of the Fund not achieving its
daily investment objective will be more acute when the underlying index has an extreme one-day movement approaching 50%.
In addition, as a result of compounding, the Funds performance for periods greater than one day is likely to be either
greater than or less than the performance of the underlying index times the stated multiple in the Funds investment objective, before accounting for fees and Fund expenses.
Compounding affects all investments, but has a more significant impact on a leveraged index fund. In general, particularly during periods of higher index volatility, compounding will cause
longer-term results to be more or less than the return of the Funds benchmark. This effect becomes more pronounced as volatility increases.
Fund performance for periods greater than one day can be estimated given any set of assumptions for the following factors: (a) underlying index performance; (b) underlying index
volatility; (c) financing rates associated with leverage; (d) other Fund expenses; (e) dividends paid by companies in the underlying index; and (f) period of time. The chart below illustrates the impact of two principal
factorsvolatility and index performanceon Fund performance. The chart shows estimated Fund returns for a number of combinations of performance and volatility over a one-year period. Performance shown in the chart assumes: (a) no
dividends paid by the companies included in the underlying index; (b) no Fund expenses; and (c) a cost of leverage of zero percent. If Fund expenses were included, the Funds performance would be lower than shown.
Areas shaded lighter represent those scenarios where the Fund can be expected to return more than twice the performance of the underlying index;
conversely, areas shaded darker represent those scenarios where the Fund can be expected to return less than twice the performance of the underlying index.
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Index Performance
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Annualized Volatility
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1x
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2x
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10%
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25%
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50%
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75%
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100%
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-60%
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-120%
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-84%
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-85%
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-88%
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-91%
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-94%
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-50%
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-100%
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-75%
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-77%
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-81%
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-86%
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-91%
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-40%
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-80%
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-65%
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-66%
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-72%
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-80%
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-87%
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-30%
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-60%
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-52%
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-54%
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-62%
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-72%
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-82%
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-20%
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-40%
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-37%
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-41%
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-49%
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-64%
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-78%
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-10%
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-20%
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-20%
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-24%
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-37%
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-55%
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-71%
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0%
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0%
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-1%
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-5%
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-22%
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-43%
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-65%
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10%
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20%
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19%
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14%
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-5%
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-31%
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-58%
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20%
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40%
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42%
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36%
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11%
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-15%
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-47%
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30%
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60%
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67%
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59%
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32%
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-3%
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-38%
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40%
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80%
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93%
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84%
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52%
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11%
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-28%
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50%
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100%
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122%
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111%
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76%
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28%
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-20%
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60%
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120%
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154%
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140%
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100%
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44%
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-10%
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The underlying indexs annualized historical volatility rate for the five year period ended June 30, 2013
is 10.43%. The underlying indexs highest one-year volatility rate during the five year period is 4.43%. The underlying indexs annualized performance for the five year period ended June 30, 2013 is 2.79%.
Historical underlying index volatility and performance are not indications of what the underlying index volatility and performance will be in the
future.
Counterparty Credit Risk
The Fund may invest in financial instruments involving counterparties that attempt to gain
exposure to a particular group of securities, index or asset class without actually purchasing those securities or investments, or to hedge a position. The Funds use of such financial instruments, including swap agreements, involves risks that
are different from those associated with ordinary portfolio securities transactions. For example, if a swap agreement counterparty defaults on its payment obligations to the Fund, this default will cause the value of your investment in the Fund to
decrease. Swap agreements also may be considered to be illiquid. Similarly, if the credit quality of an issuer or guarantor of a debt instrument improves, this change may adversely affect the value of the Funds investment.
Currency Risk
The Funds indirect and direct exposure to foreign currencies subjects the Fund to the risk that those currencies
will decline in value relative to the U.S. dollar, or, in the case of short positions, that the U.S. dollar will decline in value relative to the currency being hedged. The Fund also may incur transaction costs in connection with conversions between
various currencies.
Derivatives Risk
The Funds investments in derivatives may pose risks in addition to those
associated with investing directly in securities or other investments, including illiquidity of the derivatives, imperfect correlations with underlying investments or the Funds other portfolio holdings, lack of availability and counterparty
risk. When used to generate leveraged exposure, the Funds investments in derivatives may expose the Fund to potentially dramatic losses (or gains) in the value of the derivative instruments. The Fund could lose more than the principal amount
invested.
Early Closing Risk
The Fund is subject to the risk that unanticipated early closings of securities exchanges and
other financial markets may result in the Funds inability to buy or sell securities or other financial instruments on that day and may cause the Fund to incur substantial trading losses.
Equity Risk
The Fund is subject to the risk that the value of the equity securities or equity-based derivatives in the Funds portfolio will decline due to volatility in the equity
market caused by general market and economic conditions, perceptions regarding particular industries represented in the equity market, or factors relating to specific companies to which the Fund has investment exposure.
Leveraging Risk
The Fund achieves leveraged exposure to the underlying index through the use of derivative instruments. The more
the Fund invests in leveraged instruments, the more this leverage will magnify any losses on those investments. The Funds investment in these instruments generally requires a small investment relative to the amount of investment exposure
assumed. As a result, such investments may give rise to losses that exceed the amount invested in those instruments. Since the Funds investment strategy involves consistently applied leverage, the value of the Funds shares will tend
to increase or decrease more than the value of any increase or decrease in the underlying index. Leverage also will have the effect of magnifying tracking error.
Liquidity Risk
In certain circumstances, it may be difficult for the Fund to purchase and
sell particular investments within a reasonable time at a fair price. While the Fund intends to invest in liquid futures, options, forwards and swap contracts, under certain market conditions, such as when the market makes a limit move,
it may be difficult or impossible for the Fund to liquidate such investments. In addition, the ability of the Fund to assign an accurate daily value to certain investments may be difficult, and the Advisor may be required to fair value the
investments.
Non-Diversification Risk
The Fund is considered non-diversified and can invest a greater portion of its assets
in securities of individual issuers than a diversified fund. As a result, changes in the market value of a single security could cause greater fluctuations in the value of Fund shares than would occur in a diversified fund.
OTC Trading Risk
Certain of the derivatives in which the Fund may invest may be traded (and privately negotiated) in the OTC market.
While the OTC derivatives market is the primary trading venue for many derivatives, it is largely unregulated. As a result and similar to other privately negotiated contracts, the Fund is subject to counterparty credit risk with respect to such
derivative contracts.
Passive Investment Risk
The Fund is not actively managed and the Advisor does not attempt to take
defensive positions in declining markets. Therefore, the Fund may be subject to greater losses in a declining market than a fund that is actively managed.
Repurchase Agreement Risk
The Funds investment in repurchase agreements may be subject to market and credit risk with respect to the collateral securing the repurchase agreements.
Investments in repurchase agreements also may be subject to the risk that the market value of the underlying obligations may decline prior to the expiration of the repurchase agreement term.
Status as a Regulated Investment Company Risk
The Fund may realize gains from the sale or other disposition of foreign currencies and other income (including gains from options, futures
or forward contracts) derived from investing in stock, securities, or foreign currencies. The Secretary of the Treasury is authorized to issue regulations that might cause the Fund, as a result of its realization of such foreign currency gains, to
fail to qualify as a regulated investment company. As of the date of this Prospectus, no regulations have been issued pursuant to this authorization, but such regulations may be issued in the future.
Tracking Error Risk
The Advisor may not be able to cause the Funds performance to match that of the Funds benchmark, either
on a daily or aggregate basis. Factors such as Fund expenses, imperfect correlation between the Funds investments and those of the underlying index, rounding of share prices, changes to the composition of the underlying index, regulatory
policies, high portfolio turnover rate, and the use of leverage all contribute to tracking error. Tracking error may cause the Funds performance to be less than you expect.
Trading Halt Risk
If a trading halt occurs, the Fund may temporarily be unable to purchase or sell securities, options or futures contracts. Such a trading halt near the time the Fund
prices its shares may limit the Funds ability to use leverage and may prevent the Fund from achieving its investment objective.
PERFORMANCE
INFORMATION
The following bar chart shows the performance of the H-Class Shares of the Fund from year to year. The variability of
performance over time provides an indication of the risks of investing in the Fund. The following table shows the average annual total returns of the H-Class Shares of the Fund over different periods of time in comparison to the performance of a
broad-based market index. The figures in the bar chart and table assume the reinvestment of dividends and capital gains distributions. Of course, this past performance (before and after taxes) does not necessarily indicate how the Fund will perform
in the future.
Updated performance information is available on the Funds website at www.guggenheiminvestments.com or by calling
Guggenheim Investments Client Services at 800.820.0888.
The performance information shown below for H-Class Shares is based on a calendar year. The
year-to-date return for the period from January 1, 2013 through June 30, 2013 is 6.87%.
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Highest Quarter Return
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|
Lowest Quarter Return
|
(quarter ended 9/30/2008) 17.18%
|
|
(quarter ended 9/30/2010) -17.58%
|
AVERAGE ANNUAL TOTAL RETURN
(for periods ended December 31, 2012)
The after-tax returns presented in the table below are calculated using highest historical individual federal marginal income tax rates and do not
reflect the impact of state and local taxes. Your actual after-tax returns will depend on your specific tax situation and may differ from those shown below. After-tax returns are not relevant to investors who hold shares of the Fund through
tax-deferred arrangements, such as 401(k) plans or individual retirement accounts.
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H-Class Shares
|
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Past
1 Year
|
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Past
5 Years
|
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|
Since Inception
(5/25/2005)
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Return Before Taxes
|
|
|
-6.10%
|
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|
|
-5.00%
|
|
|
|
-4.54%
|
|
Return After Taxes on Distributions
|
|
|
-6.10%
|
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-6.24%
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-5.38%
|
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Return After Taxes on Distributions and Sale of Fund Shares
|
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-3.96%
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-4.40%
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-3.91%
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|
U.S. Dollar Index
®
(reflects no deduction for fees, expenses or taxes)
|
|
|
-0.51%
|
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|
|
0.79%
|
|
|
|
-1.04%
|
|
MANAGEMENT
INVESTMENT
ADVISOR
Security Investors, LLC, which operates under the name Guggenheim Investments, serves as the investment adviser of the Fund.
PORTFOLIO MANAGERS
|
|
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Michael P. Byrum,
CFA, Senior Vice President. Mr. Byrum has been associated with the Advisor since 1993.
|
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Michael J. Dellapa,
CFA, CAIA, Portfolio Manager. Mr. Dellapa has been associated with the Advisor since 2000.
|
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Ryan A. Harder,
CFA, Portfolio Manager. Mr. Harder has been associated with the Advisor since 2004.
|
PURCHASE AND SALE OF FUND SHARES
The
minimum initial investment amounts for H-Class accounts held through a third party (
e.g.
, a brokerage account) are typically:
|
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$1,000 for retirement accounts
|
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|
$2,500 for all other accounts
|
Accounts managed by financial professionals are not subject to minimum account balance requirements. Accounts opened through a financial intermediary (non-direct) will be subject to your financial
intermediarys minimum initial investment amount and account balance requirements, which may be different than the amounts above.
H-Class accounts held directly at Guggenheim Investments (other than those that are managed by financial professionals) are subject to a minimum
account balance of $5,000 for non-managed accounts (including retirement accounts).
There are no minimum amounts for subsequent investments in the Fund except for subsequent investments
made via Automated Clearing House (ACH). The Fund reserves the right to modify its minimum account balance requirements at any time, with or without prior notice to you.
The Fund redeems its shares continuously and investors may sell their shares back to the Fund on any day that the New York Stock Exchange (the NYSE) is open for business (a
Business Day). You will ordinarily submit your transaction order through your financial intermediary or other securities dealers through which you opened your shareholder account or through Guggenheim Investments if you opened your
account directly with the Fund. The Fund also offers you the option to send redemption orders to Guggenheim Investments by mail, fax or telephone.
TAX INFORMATION
Fund distributions are
generally taxable as ordinary income or capital gains (or a combination of both), unless your investment is in an IRA or other tax-advantaged retirement account.
PAYMENTS TO BROKER-DEALERS AND OTHER FINANCIAL INTERMEDIARIES
If you purchase the Fund through
a broker-dealer or other financial intermediary (such as a bank), the Fund and its related companies may pay the intermediary for the sale of Fund shares and related services. These payments may create a conflict of interest by influencing the
broker-dealer or other intermediary and your sales person to recommend the Fund over another investment. Ask your sales person or visit your financial intermediarys website for more information.
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