Paradigm Capital Management

Overview

Objective:

The Paradigm Opportunity Fund seeks long-term capital appreciation.

Investment Philosophy:

The Opportunity Fund invests primarily in the common stocks of companies with market capitalizations between $25 million and $2.5 billion at the time of purchase that the Advisor believes have the potential for capital appreciation. The Fund may be overweight in certain sectors at various times. Securities are sold when they have realized their anticipated value or if new investment opportunities with higher expected returns are acquired. The Advisor primarily searches for companies with market capitalizations between $25 million and $2.5 billion that exhibit attractive valuations and solid growth prospects. The valuation metrics include price to earnings, price to cash flow, price to book and price to revenue.

Investment Process:

The Advisor identifies potential investments using a proprietary valuation model to pinpoint companies that are trading at a discount to peers and/or historical valuations. Once a potential investment meets these valuation criteria, the Advisor studies public filings and trade journals, and will generally interview company management. The Advisor continues research by contacting vendors, competitors and/or customers to determine why the stock is trading at a discount and to identify catalysts that the Advisor believes will result in capital appreciation. The Advisor frequently contacts company management and also uses these communications to determine whether, in the Advisor's opinion, management's goals are aligned with those of shareholders. Final investment decisions are based on the Advisor's confidence in management's ability to execute its strategy and the attractiveness of the stock's price based on internally prepared models and valuation metrics. The Advisor will generally sell a Fund position if the company no longer meets these criteria..

Prospectus:

Please click on the link below to obtain a copy of the Fund's Prospectus:

Paradigm Funds Prospectus

Portfolio Characteristics:
(as of 6/30/2010)


Inception Date:	1/1/2005
Cusip:	69901E203
Ticker:	PFOPX
NAV:	$19.91
Net Assets ($ million)	$3.9
Number of Holdings:	32
One-Year Turnover:	104.57%
Weighted Average Market Cap ($ million):	$1,699.9
Median Market Cap ($ million):	$1,293.7
Management Fees:	1.50%
Sales Load:	none
Index:	Russell 2000

Key Differentiators:

Healthcare and technology focus
Core strategy balances value and growth
Catalyst-driven investment approach

Market Capitalization:

(as of 6/30/2010)

Past Performance Is No Guarantee Of Future Results
Please Read The Prospectus Carefully Before You Invest Or Send Money
*The Advisor has contractually agreed to waive management fees and reimburse expenses to the extent necessary to maintain total annual operating expenses of the Opportunity Fund (excluding brokerage fees and commissions, interest and other borrowing expenses, taxes, extraordinary expenses and the indirect costs of investing in Acquired Funds) at 1.50% of its average daily net assets through May 1, 2011. The fee waiver will automatically terminate on May 1, 2011 unless it is renewed by the Advisor. The Advisor may not terminate the fee waiver before May 1, 2011.