Objective and Strategy
Hawaiian Tax-Free Trust is a municipal bond mutual fund designed especially for Hawaii residents.
The Trust seeks to provide as high a level of current income exempt from Hawaii state and regular federal income taxes as is consistent with preservation of capital by investing in municipal obligations which pay interest exempt from Hawaii state and federal income taxes. To achieve this objective, the Trust will invest primarily in tax-free municipal obligations of investment grade quality - the kind of securities that finance schools, highways, airports, hospitals, and water and sewer facilities in Hawaii. These obligations can be of any maturity, but the Fund's weighted average maturity has traditionally been between 5 and 15 years.
Overview
Investor Profile
Hawaii taxpayers who can benefit from income that is exempt from federal and state income taxes. For certain investors, some dividends may be subject to federal and state taxes, including Alternative Minimum Tax (AMT). Please consult your professional tax adviser. The Trust is not appropriate for tax-deferred retirement plans, such as IRAs.
Mutual fund investing involves risk, including loss of principal.
How to Invest
You may invest in the Hawaiian Tax-Free Trust through your professional financial advisor at the public offering price as described in the prospectus, or by completing the Fund's application. The Fund offers both Front-Payment Class Shares (Class A Shares) or Level-Payment Class Shares (Class C Shares). The maximum sales charge included in the offering price of Class A Shares is 3%. Please see the prospectus for details. Class C Shares do not have a sales charge, but do have a contingent deferred sales charge (CDSC) of 1% if a redemption occurs within the first 12 months of purchase. Class F and Class Y shares are available to investors only through a professional financial advisor or a financial institution.
How to Redeem
You may redeem all or part of your investment on any business day at the next-determined Net Asset Value of the Fund's shares after acceptance of your redemption request. You should be aware that investment returns and principal value will fluctuate, so that your shares, when redeemed, may be worth more or less than their original cost. The prospectus outlines a number of different ways you may redeem your shares. A 1% contingent deferred sales charge (CDSC) applies to Class C Shares redeemed within the first 12 months of purchase.
Board of Trustees
Glenn P. O'Flaherty, Chair - Chief Financial Officer and Chief Operating Officer of Lizard Investors, LLC, 2008; Co-Founder, Chief Financial Officer and Chief Compliance Officer of Three Peaks Capital Management, LLC, 2003-2005; Vice President - Investment Accounting, Global Trading and Trade Operations, Janus Capital Corporation, and Chief Financial Officer and Treasurer, Janus Funds, 1991-2002; Former Trustee of various funds in the Aquila Group of Funds since 2006. Other Directorships held by Trustee - Granby Ranch Metropolitan District (quasi-municipal corporation); formerly Trustee of Pacific Capital Funds of Cash Assets Trust (three money-market funds in the Aquila Group of Funds) 2009-2012.
Catherine Luke - President and Director, Loyalty Enterprises, Ltd. (property management) since 2013; Vice President, Loyalty Development, Ltd. (real estate investment) since 2012; President and Director, KJL, Inc. (real estate investment) since 2011; Director, Hawaii Leadership Forum (leadership program) since 2015. Other Directorships held by Trustee - Director, Trinity Merger Corporation (special purpose acquisition vehicle) 2018-2019.
Randolph Perreira - Executive Director, Hawaii Government Employees Association since 1986; President, Hawaii State AFLCIO since 2005; Director, Aloha United Way since 2005; Member, P-20 Council for the State of Hawaii since 2003; Director, American Judicature Society (Hawaii) since 2009; current Board member, Industrial Relations Research Association; current Board member, Hawaii Medical Services Association; currently or formerly active with various civic and charitable organizations.
Portfolio Managers
Reid Smith, Fixed Income Director and Vice President at Bank of Hawaii, serves as the lead portfolio manager of the Trust. Reid has over 30 years of fixed income portfolio management experience with an extensive background in taxable and tax-exempt fixed income. He began his career in Fixed Income as a Portfolio Manager and Vice President with the investment department of Bank of Hawaii (formerly Hawaiian Trust Company) where he managed the Hawaiian Tax-Free Trust for several years.
Prior to rejoining the Bank of Hawaii in 2021, Reid was Chief Investment Officer for Ziegler BPG Fixed Income Strategies and Senior Portfolio Manager in New York City. Between 2011 and 2015, Mr. Smith was Head of Barclays Fixed Income Portfolio Management at Barclays Wealth and Investment Management in the Americas. At Barclays, Mr. Smith was responsible for the development, strategy, implementation and ongoing management of both taxable and tax-exempt Fixed Income Portfolio Management.
Before Barclays, Mr. Smith worked at Vanguard Group for 17 years. During his tenure, he held increasingly senior fixed income strategic and portfolio management positions including Head of the Municipal Long Term Bond Desk, Municipal Credit Strategy Team Leader, Municipal Rates Strategy Team member, and Head of Municipal Strategy. Additionally, he played a key role in developing the facets of Vanguard's municipal bond fund strategies including duration, credit, fund structure, hedging and risk metrics.
Reid is a Chartered Financial Analyst and a graduate of the University of Hawaii's Shidler School of Business where he received both his Bachelor's and Master's degrees in business administration. He is also a graduate of Punahou
Mr. Mahi serves as assistant portfolio manager of the Trust. Prior to joining the Bank of Hawai'i in May 2024, he worked at Cantor Fitzgerald in New York City and the Employees' Retirement System Hawaii in Honolulu in various analytical roles. Mr. Mahi holds both a Master's degree and a Bachelor of Business Administration in Finance from the Shidler College of Business at the University of Hawai'i at Mānoa. He has also passed Level I of the Chartered Financial Analyst (CFA) Program.
