Long/Short Healthcare Fund

James Dondero Blue BackgroundJAMES DONDERO, CFA

Bio »


James Dondero is Co-founder and President of Highland Capital Management, L.P. Mr. Dondero has over 30 years of experience in the credit and equity markets, focused largely on high-yield and distressed investing. Under Mr. Dondero’s leadership, Highland has been a pioneer in both developing the collateralized loan obligation (CLO) market and advancing credit-oriented solutions for institutional and retail investors worldwide. Highland’s product offerings include institutional separate accounts, CLOs, hedge funds, private equity funds, mutual funds, REITs, and ETFs. Mr. Dondero is the Chairman and President of NexPoint Residential Trust, Inc. (NYSE:NXRT), is Chairman of NexBank Capital, Inc., Cornerstone Healthcare Group Holding, Inc., and CCS Medical, Inc., and a board member of Jernigan Capital, Inc. (NYSE:JCAP), and MGM Holdings, Inc. He also serves on the Southern Methodist University Cox School of Business Executive Board. A dedicated philanthropist, Mr. Dondero actively supports initiatives in education, veterans affairs, and public policy. Prior to founding Highland in 1993, Mr. Dondero was involved in creating the GIC subsidiary of Protective Life, where as Chief Investment Officer he helped take the company from inception to over $2 billion between 1989 and 1993. Between 1985 and 1989, Mr. Dondero was a corporate bond analyst and then portfolio manager at American Express. Mr. Dondero began his career in 1984 as an analyst in the JP Morgan training program. Mr. Dondero graduated from the University of Virginia where he earned highest honors (Beta Gamma Sigma, Beta Alpha Psi) from the McIntire School of Commerce with dual majors in accounting and finance. He has received certification as Certified Public Accountant (CPA) and Certified Managerial Accountant (CMA) and has earned the right to use the Chartered Financial Analyst (CFA) designation.

Managing Director

Bio »

Managing Director

Mr. Burns is a Managing Director at Highland Capital Management, L.P. Prior to joining Highland, he was an Associate at Ripplewood Holdings, a global private equity firm focused on control-oriented buyout, distressed and special situations investments across a variety of industries. At Ripplewood, Mr. Burns was responsible for sourcing and executing investment transactions, as well as actively leading portfolio company operational and financial restructuring initiatives. Prior to joining Ripplewood, he was an Analyst in the Global Technology Mergers & Acquisitions group at Lehman Brothers. Mr. Burns received a B.S. in Analytical Finance and Economics, summa cum laude and Phi Beta Kappa, from Wake Forest University and an MBA, with Dean’s Honors and Distinction, from Columbia Business School. Mr. Burns is a holder of the right to use the Chartered Financial Analyst designation. He currently serves on the Board of Directors of Oasis I Limited and Tandem Hospital Partners, LLC.

Fund Overview

Investment Objective

The Long/Short Healthcare Fund seeks long-term capital appreciation by pairing effective risk management with alpha generating potential from long and short investments in public equities across all market capitalizations in the Healthcare industry. The Healthcare industry is undergoing massive structural changes resulting in both long and short investment opportunities. 

  • Seeks long-term capital appreciation.
  • Seeks to participate in the long term growth potential of the Healthcare market.
  • Our strategy seeks to pair effective risk management with alpha generating potential from superior stock picking.
  • The primary focus of the Fund will be long and short investments in public equities across all market capitalizations in the Healthcare sector.

Why Long/Short Healthcare

An Alternative to Long Only Sector Investing
  • Healthcare is one of the largest and fastest growing components of US GDP2
  • Opportunity to invest in the Biotechnology Revolution
  • Active management is optimal as correlations decline and dispersion increases
  • Strategy seeks to deliver alpha and attractive absolute return at low-beta, low-correlation to S&P 500
Why Highland
  • Highland currently has $1.29 billion in healthcare assets under management3
  • Deep bench of 5 sector-specialists with over 60 years of combined experience
  • World class group of Healthcare Advisors to complement internal team4
  • Small and nimble; can take advantage of largest opportunity set
  • We believe our competitive advantage is driven by our Philosophy, People and Process
Fund NAV (As of Jul 17, 2019)
HHCAX (Class A)$14.09
HHCCX (Class C)$13.17
HHCZX (Class Z)$14.64
Fund AUM (As of Jul 17, 2019)
Total Net Assets$43.5 M
Class AClass CClass Z
Gross Expense Ratio2.64%3.30%2.36%
Net Expense Ratio12.64%3.30%2.36%

Historical Returns & NAV

As of 07/17/2019Class AClass CClass Z
Net Asset Value (NAV)$14.09$13.17$14.64
Daily NAV Change ($)$-0.05$-0.04$-0.05
Daily NAV Change (%)-0.35%-0.30%-0.34%
As of 06/30/2019 MonthlyQuarterlyClass AClass A (w/sales charge)Class CClass C (w/sales charge)Class Z
One Year8.79%2.84%8.11%7.11%9.17%
Three Year7.22%5.21%6.53%6.53%7.62%
Five Year0.56%-0.57%-0.04%-0.04%0.95%
Ten Year6.54%5.93%5.91%5.91%6.90%
Since Inception5.56%5.03%4.94%4.94%5.94%

View all Literature & Forms

The performance data quoted here represents past performance and is no guarantee of future results. Investment returns and principal value will fluctuate so that an investor’s shares when redeemed may be worth more or less than their original cost. Current performance may be lower or higher than performance data quoted.

Please consider the investment objectives, risks, charges and expenses of Highland Funds carefully before investing. A prospectus with this and other information about Highland's mutual funds can be found on the Literature tab above. You may also obtain a prospectus for our mutual funds by calling 877-665-1287. Please read the prospectus carefully before investing.

1 Performance results reflect the contractual waivers and/or reimbursements of fund expenses by the Advisor. Absent this limitation, performance results would have been lower. Total net operating expenses excluding dividends on short sales are Class A 2.10%, Class C 2.75%, and Class Z 1.75%.

2 Source: National Coalition on Health Care as of June 2011.

3 Includes AUM of affiliated advisers.

4 The “Advisory Group” referenced is comprised of 16 healthcare professionals who are not employed by the Adviser and do not receive compensation for their services. This network of healthcare professionals is utilized when the Portfolio Manager desires industry expertise and perspective on topics such as healthcare reform, new technologies, and improvements in the delivery of healthcare in the US. Members of the Advisory Group do not provide investment advice and do not make recommendations on behalf of the Fund.

*The maximum sales charge for Class A shares is 5.50%.

Debt Securities Risk. The Fund’s ability to invest in high-yield debt securities generally subjects the Fund to greater risk than securities with higher ratings. Such securities are regarded by the rating organizations as predominantly speculative with respect to capacity to pay interest and repay principal in accordance with the terms of the obligation.

Derivatives Risk. Derivatives are subject to the risk that changes in the value of a derivative may not correlate perfectly with the underlying asset, rate or index. Derivatives also expose the Fund to the credit risk of the derivative counterparty.

Equity Securities Risk. Equity securities, such as common stocks, are subject to market, economic and business risks that may cause their prices to fluctuate.

Industry Concentration Risk. Because the Fund normally invests at least 80% of the value of its assets in healthcare companies, the Fund’s performance largely depends on the overall condition of the healthcare industry and the Fund is susceptible to economic, political and regulatory risks or other occurrences associated with the healthcare industry.

Leverage Risk. Leverage may increase the risk of loss, cause fluctuations in the market value of the Fund’s portfolio to have disproportionately large effects or cause the NAV of the Fund generally to decline faster than it would otherwise.

Micro, Small and Mid-Cap Securities Risk. Investments in securities of companies with micro, small or medium capitalizations involve certain risks that may differ from, or be greater than, those for larger companies, such as higher volatility, lower trading volume, fewer business lines and lack of public information.

Non-U.S. Securities Risk. Investments in securities of non-U.S. issuers involve certain risks not involved in domestic investments (for example, expropriation or political or economic instability).

Portfolio Turnover Risk. High portfolio turnover will increase the Fund’s transaction costs and may result in increased realization of net short-term capital gains, higher taxable distributions and lower after-tax performance.

Short Sales Risk. Short sales that are not made “against-the-box” (as defined under “Description of Principal Investments”) theoretically involve unlimited loss potential since the market price of securities sold short may continuously increase.

Glossary: Click for important terms and definitions

Source: State Street Bank and Trust Company

Highland Funds’ mutual funds are distributed by Highland Capital Funds Distributor