Why 60/40 Could Fail Retirees in the Next Downturn

Clients shouldn’t have to gamble when the next bear market hits. A risk balanced approach like the Catalyst/Millburn Hedge Strategy Fund (MBXIX) is a potentially compelling strategy.

A record number of Americans are retiring today when many investment professionals believe we’re near the end of a bull market. A bear market early in retirement can permanently reduce income and lifestyle for clients relying on traditional 60/40 portfolios.

With a $1 Million Retirement Portfolio, How Much Money Could You Withdraw Over the First 20 Years?*

Source: Catalyst Capital Advisors LLC and Bloomberg LP. 60/40 Portfolio: 60% S&P 500 TR Index and 40% Bloomberg U.S. Aggregate Index (rebalanced monthly).
*Retirement Assumptions:
1. Initial portfolio value: $1 million
2. Withdrawal Rate: 4% annualized paid monthly (minimum of $40,000/year; $800,000 total)
3. Withdrawals taken at beginning of month
4. not adjusted for inflation

Traditional 60/40 Portfolios are typically highly sensitive to retirement timing.

A retiree with a traditional 60/40 Portfolio entering retirement at the end of a bull market (12/31/1999) faced $15,000 less per year in withdrawals than one retiring after a bear market (12/31/2002), and inflation only widens the gap.

The Catalyst/Millburn Hedge Strategy Fund (MBXIX) keeps strategic equity exposure but adds a diversified global futures strategy. It implements a risk balanced approach, which means it has the potential to play both offense and defense.

Since 1997, MBXIX has delivered positive returns in every structural bear market, potentially helping retirees stay on track.

The below chart shows how a traditional 60/40 bond portfolio would have fared versus MBXIX in the respective time periods.

Source: Catalyst Capital Advisors LLC and Bloomberg LP. Traditional 60/40 Portfolio: 60% S&P 500 TR Index and 40% Bloomberg U.S. Aggregate Index (rebalanced monthly). Risk Balanced Strategy: 100% MBXIX. Retirement assumptions: 1) initial portfolio value: $1 million, 2) withdrawal rate: 4% annualized paid monthly (minimum of $40,000/year; $800,000 total), 3) withdrawals taken at beginning of month, and 4) not adjusted for inflation.

Don’t let market timing dictate your clients’ retirement outcomes. We believe now is the time to position portfolios with MBXIX. Contact us to learn more about implementing MBXIX for your clients’ retirement portfolios.

Data as of quarter end: 2025-09-30T00:00:00

Share Class	1 Month	3 Months	6 Months	YTD	1 Year	3 Years Annualized	5 Years Annualized	10 Years Annualized	Since Inception Annualized
Class I	0.66%	1.95%	4.33%	2.47%	7.30%	5.41%	9.88%	8.42%	10.10%
Class A	0.66%	1.89%	4.20%	2.31%	7.02%	5.15%	9.62%	N/A	7.91%
Class C	0.58%	1.71%	3.81%	1.73%	6.22%	4.37%	8.79%	N/A	7.10%
Class C-1	0.59%	1.69%	3.81%	1.72%	6.23%	4.36%	N/A	N/A	9.87%
Class A w/Sales Load	-5.13%	-3.97%	-1.79%	-3.57%	0.87%	3.09%	8.33%	N/A	7.26%

Investments in mutual funds involve risks. The Fund’s maximum sales charge for Class “A” shares is 5.75%. Investment return and principal value will fluctuate with changing market conditions so that when redeemed, shares may be worth more or less than their original cost. Current performance may be lower or higher than the performance data quoted. To obtain the most recent month-end performance information or the Fund’s prospectus, please call the Fund toll free at 1-866-447-4228 or visit www.CatalystMF.com. Total operating expenses for the A, C, and I share classes are 2.28%, 3.03%, and 2.03%, respectively.

There is no assurance that the Fund will achieve its investment objective. You cannot invest directly in an index and unmanaged index returns do not reflect any fees, expenses or sales charges. Performance shown before December 28, 2015 is for the Fund’s Predecessor Fund (Millburn Hedge Fund, L.P.); please refer to important disclosures set forth below.
Past performance is not a guarantee of future results.

Investors should carefully consider the investment objectives, risks, charges and expenses of the Catalyst Funds. This and other important information about the Fund is contained in the prospectus, which can be obtained by calling 866-447-4228 or at www.CatalystMF.com. The prospectus should be read carefully before investing. The Catalyst Funds are distributed by Northern Lights Distributors, LLC, member FINRA/SIPC. Neither Catalyst Capital Advisors LLC nor Millburn Ridgefield LLC are affiliated with Northern Lights Distributors, LLC.

Important Risk Considerations

Investing in the Fund carries certain risks. The Fund will invest a percentage of its assets in derivatives, such as futures, forwards and options contracts. The use of such derivatives and the resulting high portfolio turn-over may expose the Fund to additional risks that it would not be subject to if it invested directly in the securities and commodities underlying those derivatives. The Fund may experience losses that exceed those experienced by funds that do not use futures, forwards, options and hedging strategies. Investing in commodities markets may subject the Fund to greater volatility than investments in traditional securities. Currency trading risks include market risk, credit risk and country risk. Foreign investing involves risks not typically associated with U.S. investments. Changes in interest rates and the liquidity of certain investments could affect the Fund’s overall performance. The Fund is non-diversified and, as a result, changes in the value of a single security or group of securities may have significant effect on the Fund’s value. Other risks include U.S. Government securities risks and investments in fixed income securities. Typically, a rise in interest rates causes a decline in the value of fixed income securities or derivatives owned by the Fund. Furthermore, the use of leveraging can magnify the potential for gain or loss and amplify the effects of market volatility on the Fund’s share price. The Fund is subject to regulatory change and tax risks; changes to current rules could increase costs associated with an investment in the Fund. These factors may affect the value of your investment.

The Fund acquired all of the assets and liabilities of Millburn Hedge Fund, L.P. (the “Predecessor Fund”) in a tax free reorganization on December 28, 2015 (the “Reorganization”). In connection with the Reorganization, shares of the Predecessor Fund were exchanged for Class I shares of the Fund. Performance shown before December 28, 2015 is for the Predecessor Fund. The prior performance is net of management fees and other expenses, including the effect of the performance fee. The Predecessor Fund had an investment objective and strategies that were, in all material respects, the same as those of the Fund, and was managed in a manner that, in all material respects, complied with the investment guidelines and restrictions of the Fund. The Fund’s Sub-Adviser was the investment manager of the Predecessor Fund. From its inception through December 28, 2015, the Predecessor Fund was not subject to certain investment restrictions, diversification requirements and other restrictions of the Investment Company Act of 1940, as amended, or the Internal Revenue Code of 1986, as amended, which if they had been applicable, might have adversely affected its performance. In addition, the Predecessor Fund was not subject to sales loads that would have adversely affected performance. The Fund’s fees and expenses are expected to be higher than those of the Predecessor Fund; therefore, if the Fund’s expenses were applied to the Predecessor Fund’s performance, the performance would have been lower. Performance of the Predecessor Fund is not an indicator of future results.

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