Fund Evaluator:
Water Island Event-Driven Fund R (AEDFX)
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Best Performing in Event Driven Over the Last Year
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Fund Details
Water Island Event-Driven Fund R Overview
Water Island Event-Driven Fund R (AEDFX) is an actively managed Alternative Event Driven fund. Arbitrage Fund launched the fund in 2010.
The investment seeks to achieve capital growth. The fund invests in equity and debt and debt-like instruments (including high yield bonds commonly known as "junk bonds") of companies whose prices the fund's investment adviser believes are or will be impacted by a corporate event. Specifically, the fund employs investment strategies designed to capture price movements generated by corporate events such as mergers, acquisitions, asset sales, restructurings, refinancings, recapitalizations, reorganizations or other special situations (referred to as "event-driven opportunities"). It is non-diversified.
About Water Island Event-Driven Fund R (AEDFX)
There are 4 members of the management team with an average tenure of 10.72 years: Roger Foltynowicz (2010), Matthew Osowiecki (2023), Gregory Loprete (2010), John Orrico (2018). Management tenure is more important for actively managed funds than passive index funds.
The fund has 2 primary benchmarks: S&P 500 (TR) (1970) index with a weighting of 100% and ICE BofA US 3M Trsy Bill TR USD index with a weighting of 100%. Water Island Event-Driven Fund R has 114 securities in its portfolio. The top 10 holdings constitute 41.0% of the fund’s assets. The fund meets the SEC requirement of being classified as a nondiversified fund. The fund is not considered to have an ESG focus with its investment selection and management.
Water Island Event-Driven Fund R is part of the Alternative Strategies global asset class and is within the Alternative fund group. Water Island Event-Driven Fund R has 7.2% of its portfolio invested in foreign issues. The overall assets allocated to domestic stock is 62.8%. There is 7.2% allocated to foreign stock, and 0.0% is allocated to preferred stocks. The bond allocation as a percentage of total assets is 13.6% (13.6% domestic bond, 0.0% foreign bond and 1.6% convertible bond). Water Island Event-Driven Fund R has 15.1% of the portfolio in cash.
Assets Under Management
The fund has $1 million in total assets, which is below the $329 million average for the Event Driven category. Normally, lower assets under management translates to higher average expense ratios, and greater total assets are desired. However, for some investment categories, such as small-cap investing, it may be difficult for the manager to fully employ the desired active strategy if assets grow too large or too quickly.
AEDFX Performance and Fees
The expense ratio measures how much of a fund’s assets are used for administrative expenses and operating expenses, including adviser fees and fees for the transfer agent and custodial services. The Water Island Event-Driven Fund R expense ratio is high compared to funds in the Event Driven category. Water Island Event-Driven Fund R has an expense ratio of 1.71%, which is 11% lower than its category average, making the fund expense ratio grade a B. While it is difficult to predict returns, it is known that high annual expense ratios reduce your rate of return, and excessive fees are difficult to overcome. Active management normally comes with higher expense ratios than passive index management. Certain investment categories such as small company and foreign also normally have higher expense ratios. It is best to compare fund expense ratios against the category averages for meaningful assessments.
High portfolio turnover can translate to higher expenses and lower aftertax returns. Water Island Event-Driven Fund R has a portfolio turnover rate of 195%, indicating that holds its assets around 0.0 years. By way of comparison, the average portfolio turnover is 218% for the Event Driven category.
Recently, in the month of July 2026, Water Island Event-Driven Fund R returned 0.2%, which earned it a grade of C, as the Event Driven category had an average return of 0.0%. The letter grades of A, B, C, D and F are based upon relative rankings within the investment category. A grade of A, for example, would indicate that the return is in the highest 20% for that time period compared to all funds in that category.
Water Island Event-Driven Fund R has a trailing yield of 0.65%, which is below the 2.23% category average. The fund normally distributes its income annually and its capital gains annually.
It’s natural to seek the best-performing investments, but you must consider the relationship between risk and return and the impact of costs and taxes on your realized returns.
Water Island Event-Driven Fund R Grades
Year to date, the fund has returned 4.2%, 1.8 percentage points better than the category, which translates into a grade of A. The fund has returned 7.2% over the past year (grade of A), 6.3% over the past three years (grade of B) and 4.0% per year over the past five years (grade of C) and 4.2% per year over the past 10 years (grade of C).
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AEDFX Trailing NAV Total Returns Data as of 7/31/26
| Last Month |
Last Quarter |
Ann'l. 1Yr |
Ann'l. 3Yr |
Ann'l. 5Yr |
Ann'l. 10Yr |
|
| AEDFX Return (NAV) | 0.2% | 2.6% | 7.2% | 6.3% | 4.0% | 4.2% |
| AEDFX Grade | C | A | A | B | C | C |
| +/- Category | 0.2% | 1.9% | 1.2% | 0.0% | 0.1% | -0.2% |
| Event Driven Avg | 0.0% | 0.7% | 6.0% | 6.3% | 3.9% | 4.4% |
| AEDFX Tax Cost Ratio | na | na | 0.3% | 0.2% | 0.1% | 0.1% |
AEDFX Annual NAV Total ReturnsData as of 7/31/26
| 2026 | 2025 | 2024 | 2023 | 2022 | 2021 | 2020 | 2019 | 2018 | 2017 | 2016 | |
| AEDFX Return (NAV) | 4.2% | 8.4% | 1.9% | 5.6% | -0.8% | 0.9% | 13.0% | 4.5% | -0.3% | 3.7% | 5.1% |
| AEDFX Grade | A | B | F | B | C | D | B | D | F | D | B |
| +/- Category | 1.8% | -0.5% | -2.3% | 0.8% | 0.8% | -1.5% | 5.3% | -2.5% | -3.5% | -0.9% | 2.2% |
| Event Driven Avg | 2.4% | 8.9% | 4.2% | 4.8% | -1.6% | 2.4% | 7.7% | 7.0% | 3.1% | 4.6% | 2.8% |
| Risk Measures | |
| Standard Deviation: | 3.0% |
| Total Risk Index: | 0.24 - Low |
| Category Risk Index: | 0.79 - Average |
| Category Risk Grade: | C (59% Rank) |
| Beta: | 0.10 |
| R-Squared: | 18% |
| Leveraged Fund: | No |
| Inverse Fund: | No |
| Portfolio Characteristics | |
| Equity Investment Style: | Small-Cap Value |
| Bond Investment Style: | na |
| Yield: | 0.7% |
| Dividend Distribution: | Annually |
| Cap Gains Distribution: | Annually |
| Total Assets: | $51 Mil |
| Fund Total Assets: | $ 1 Mil |
| Share Class Type: | Retirement |
| Portfolio Turnover: | 195% |
Management Team
| Number of Managers: 4 | |||
| Longest Tenure: 15.8 years | |||
| Average Tenure: 10.7 years | |||
| Managers (Year): Foltynowicz Roger (2010), Loprete Gregory (2010), Orrico John (2018), Osowiecki Matthew (2023) | |||
Portfolio Composition (as of 5/31/26)
| # of Holdings: | 114 |
| % in Top 10 Holdings: | 41.0% |
| Fund is Non-Diversified: | Yes |
| % in Foreign Issues: | 7.2% |
Portfolio Allocation |
|
| Domestic Stock: | 62.8% |
| Foreign Stock: | 7.2% |
| Preferred Stock: | 0.0% |
| Domestic Bond: | 13.6% |
| Foreign Bond: | 0.0% |
| Convertible Bond: | 1.6% |
| Other: | -0.4% |
| Cash: | 15.1% |
Purchase Information
| Fund Family: | Arbitrage Fund |
| Phone Number: | 800-295-4485 |
| Website: | www.thearbfund.com |
| Status: | Open |
| Inception Date: | October 1, 2010 |
| Min. Initial Purchase: | $2,000 |
| Min. Initial IRA Purchase: | $2,000 |
| True No-Load: | Yes |
| Front Load Maximum: | 0.00% |
| Deferred Charge Maximum: | 0.00% |
| Redemption Charge Maximum: | 0.00% |
| 12b-1 Fee: | 0.25% |
Expenses and Fees | |
| Expense Ratio (%): | 1.71% ( Rating : High ) |
| Category Average Expense Ratio (%): | 1.92% |
| Share Class: | Water Island Event-Driven Fund I |
| Min. Subsequent Purchase: | $ 0 |
| Min. Subsequent IRA Purchase: | $ 0 |
