Code of Ethics

Standard of Conduct

All officers, directors, employees, investment advisory representatives, or other associated persons are required to act with the highest level of ethical standards in order to ensure that RiverFront Investment Group, LLC ("RiverFront") fulfills its fiduciary duty to its clients and complies with the rules and regulations of the Investment Advisers Act of 1940. RiverFront has a duty to exercise its authority for the benefit of its clients, to place the interests of its clients first, and to refrain from having outside interests that conflict with the interests of its clients. RiverFront and its related persons must avoid any circumstances that will adversely affect its duty of loyalty to its clients. Furthermore, any circumstances that could potentially present a conflict of interest require proper disclosure.

Insider Trading

RiverFront Investment Group, LLC forbids any officer, director, employee, investment advisory representative, or other associated persons from trading, either personally or on behalf of others, on material non-public information or communicating material non-public information to others in violation of the Insider Trading and Securities Fraud Enforcement Act of 1988. This conduct is frequently referred to as "insider trading." This policy applies to every officer, director, employee, investment advisory representative and other associated persons and extends to activities within and outside their duties at RiverFront. This agreement must be read and signed by all officers, directors, employees, investment advisory representatives and other associated persons.

While the law concerning insider trading is not static, it is generally understood that the law prohibits:

  • Trading by an insider on the basis of material non-public information;
  • Trading by a non-insider on the basis of material non-public information, where the information was disclosed in violation of an insider's duty or was misappropriated; or,
  • Communicating material non-public information to others.

Who is an Insider?

The term "insider" is broadly defined. It includes officers, directors and employees of a company. In addition, a person can be a "temporary insider." A temporary insider can include, among others, attorneys, accountants, consultants, bank lending officers, and the employees of such organizations. If a client expects RiverFront to keep non-public information confidential, and the relationship implies such a duty, then RiverFront will be considered an insider.

What is Material Information?

Trading on insider information is not a basis for liability unless the information is material. "Material information" generally is defined as information that a reasonable investor would likely consider important in making their investment decisions, or information that is reasonably certain to have a substantial effect on the price of a company's securities, regardless of whether the information is related directly to the company's business. Information that should be considered material includes, but is not limited to: dividend changes; earnings estimates; changes in previously released earnings; merger or acquisition details; major litigation; liquidation problems; and extraordinary management developments.

What is Non-Public Information?

Information is considered to be non-public until it has been effectively communicated to the marketplace.

Penalties for Insider Trading

Penalties for trading on or communicating material non-public information are severe, both for individuals involved in such unlawful conduct and their employers. A person can be subject to some or all of the penalties described below even if they do not personally benefit from the activities surrounding the violation. Penalties include: civil injunctions; treble damages; disgorgement of profits; jail sentences; fines for the person who committed the violation of up to three times the profit gained or loss avoided, and, fines for the employer or other controlling person of up to the greater of $1,000,000 or three times the amount of the profit gained or loss avoided. In addition, any violation of this policy can be expected to result in serious sanctions, including dismissal of the persons involved.

Procedures to Implement Insider Trading Policy

The following procedures have been established to aid the officers, directors, employees, investment advisory representatives and other associated persons in avoiding insider trading violations.

  • Identify insider information
  • Is the information material? Would an investor consider it important in making investment decisions? Would the information substantially affect the market price of the security?
  • Is the information non-public? Has the information been effectively communicated to the market place?

If, after considering the above, the information is material and non-public, or if further questions arise as to whether the information is material and non-public, follow these procedures:

  • Immediately report the matter to the CCO.
  • Do not purchase, sell or recommend the securities for anyone, including RiverFront clients.
  • Do not communicate the information to anyone other than the CCO.
  • The CCO will determine the proper course of action.

Resolving Issues Concerning Insider Trading

If, after consideration of the items set forth above, doubt remains as to whether information is material or non-public, or if there are any unresolved questions as to the applicability or interpretation of the foregoing procedures, or as to the propriety of any action, it must be discussed with the CCO before trading or communicating the information to anyone.

Personal Trading Procedures

All employees of RiverFront who have access to client investment recommendations prior to execution (access persons), as well as all officers and directors, are required to submit reports to the CCO or other designated agent for review in order to determine whether their investment activity conflicts with the best interests of its clients. Reports must include every account in which the access person, and any member of their household, has ownership and control.

In addition, the following transactions are prohibited without express written consent from the CCO prior to execution:

  • Initial Public Offerings
  • Private Placements

Transaction Reports

Access persons are required to provide the CCO with duplicate original account statements for all accounts in which securities transactions can be effected. Statements must be submitted no later than 30 days following the end of each calendar quarter, and shall include the names of the securities, dates of the transactions, quantities, prices, and broker/dealer or other entity through which the transactions were effected.

Holdings Reports

At the time a person becomes an access person, he/she must, within 10 days, provide the CCO with detailed information regarding all current investment holdings, such as name, quantity of shares, and estimated market value. Holdings reports must include securities held by banks, broker/dealers, or transfer agents; securities in certificate form; and private placement investments. Access persons must submit updated holdings reports at least once each calendar year. Holdings Reports must be current as of a date not more than 45 days from the date of submission. Access persons who provide all of the required information to fulfill the Transaction Reports requirement need not duplicate such information.

Exceptions from Personal Trading Procedures

  • Direct obligations of the US Government;
  • Money market instruments;
  • Money market funds;
  • Open-end mutual funds, provided that RiverFront is not the investment adviser to the fund;
  • Exchange Traded Funds;
  • Unit investment trusts that are invested exclusively in one or more open-end funds, provided that RiverFront is not the investment adviser to the UIT;
  • Municipal Securities
  • Variable insurance product sub-accounts, provided that the underlying investment is an unaffiliated mutual fund; and,
  • Transactions effected in an automatic investment plan (initial purchase requires reporting).

Reporting Violations of the Code of Ethics

RiverFront requires that all officers, directors, employees, investment advisory representatives or other associated persons promptly report any violations of this Code of Ethics to the CCO.