Forward Allocation Funds

Forward Emerging Markets Fund, Forward International Dividend Fund, Forward International Fixed Income Fund:
Foreign securities, especially emerging markets, will involve additional risks including exchange rate fluctuations, social and political instability, less liquidity, greater volatility and less regulation.

Forward Banking and Finance Fund, Forward Growth Fund:
Funds that concentrate in a particular industry will involve a greater degree of risk than a fund with a more diversified portfolio. Small company stocks are generally riskier than large company stocks due to greater volatility and less liquidity.

Forward Legato Fund, Forward Small Cap Fund, Forward Small to Mid Cap Fund:
Small company stocks are generally riskier than large company stocks due to greater volatility and less liquidity.

Forward Select Income Fund:
The Fund will invest in lower-rated debt securities. The Fund may invest in a larger percentage of its assets in the securities of a smaller number of issuers, since it is a “non-diversified” mutual fund. Real Estate Investment Trust (REIT) funds will be subject to a higher degree of market risk because of concentration in a specific industry, sector or geographic sector. Risks also include declines in the value of real estate, general and economic conditions.

Forward Strategic Realty Fund:
The Fund will invest in lower-rated debt securities and may utilize derivatives for hedging purposes. The Fund’s use of short selling involves additional risks and transaction costs, and creates leverage, which can increase the volatility of the Fund. The Fund may invest in a larger percentage of its assets in the securities of a smaller number of issuers, since it is a “non-diversified” mutual fund.

Forward Global Infrastructure Fund:
The Fund concentrates its investments in infrastructure-related entities and therefore has greater exposure to the potential adverse economic, regulatory, political and other changes affecting such entities. The Fund may invest in a larger percentage of its assets in the securities of a smaller number of issuers, since it is a “non-diversified” mutual fund. The Fund also invests in foreign securities which involve additional risks including exchange rate fluctuations, social and political instability, less liquidity, greater volatility and less regulation.

Forward International Small Companies Fund:
Small company stocks are generally riskier than large company stocks due to greater volatility and less liquidity. Investing in foreign securities, especially emerging markets, will involve additional risks including exchange rate fluctuations, social and political instability, less liquidity, greater volatility and less regulation.

Forward Large Cap Equity Fund:
There are risks involved with investing, including loss of principal. Past performance does not guarantee future results, share prices will fluctuate, and you may have a gain or loss when you redeem shares.

Forward International Real Estate Fund:
The Fund will invest in lower-rated debt securities and may utilize derivatives for hedging purposes. The Fund’s use of short selling and derivatives involves additional risks and transaction costs, and creates leverage, which can increase the volatility of the Fund. The Fund may invest in a larger percentage of its assets in the securities of a smaller number of issuers, since it is a “non-diversified” mutual fund. Foreign securities, especially emerging markets, will involve additional risks including exchange rate fluctuations, social and political instability, liquidity, greater volatility and less regulation.

Forward Long/Short Credit Analysis Fund:
The Fund will invest in lower-rated debt securities and may utilize derivatives for hedging purposes. The Fund’s use of short selling and derivatives involves additional risks and transaction costs, and creates leverage, which can increase the volatility of the Fund. The Fund may invest in a larger percentage of its assets in the securities of a smaller number of issuers, since it is a “non-diversified” mutual fund. High-yield bonds involve a greater risk of default and price volatility than U.S. Government and other high-quality bonds. High-yield/high-risk bonds will experience sudden and sharp price swings, which will affect net asset value. The Fund's prospectus allows for investment in non-investment grade securities.

Forward Real Estate Fund:
Real Estate Investment Trust (REIT) funds will be subject to a higher degree of market risk because of concentration in a specific industry, sector or geographic sector. Risks also include declines in the value of real estate, general and economic conditions.

Forward Tactical Growth Fund:
The underlying investments of the Fund (such as Exchange Traded Funds (ETFs), futures and options on securities, securities indexes and shares of ETFs) involve heightened risks related to liquidity, increased volatility and unfavorable fluctuations in currency values. The underlying international and real estate investments will also be subject to economic or political instability in the U.S. and other countries, credit risk and interest rate fluctuations. Investors will indirectly bear the expenses of the Fund’s underlying investments. The Fund’s use of short selling and derivatives involves additional risks and transaction costs, and creates leverage, which can increase the volatility of the Fund.

The Forward Tactical Growth Fund was launched on September 14, 2009, and has a limited operating history.

Forward Frontier Markets Fund:
The Frontier Markets Fund is not a diversified fund and investors will indirectly bear the expenses of the fund’s underlying investments. The underlying investments of the Frontier Markets Fund (such as structured notes, derivatives, commodities and levered Exchange Traded Funds or ETFs) may involve heightened risks related to liquidity, increased volatility, and unfavorable fluctuations in currency values. The underlying international and real estate investments may also be subject to economic or political instability in the US and other countries, credit risk and interest rate fluctuations. There is no guarantee that the fund will achieve its stated objectives.

Forward High Yield Bond Fund:
High-yield bonds involve a greater risk of default and price volatility than U.S. Government and other high quality bonds. High-yield/high-risk bonds can experience sudden and sharp price swings which will affect net asset value. By investing in high yield bonds you may be subjected to greater price volatility based on fluctuations in issuer and credit quality. When investing in bonds, you are subject, but not limited to, the same interest rate, inflation and credit risks associated with the underlying bonds owned by the Fund.

Forward Mortgage Securities Fund:
When investing in bonds, you are subject, but not limited to, the same interest rate, inflation and credit risks associated with the underlying bonds owned by the Fund. Mortgage-backed securities are subject to prepayment and extension risk and therefore react differently to changes in interest rates than other bonds. Small movements in interest rates may quickly and significantly reduce the value of certain mortgage-backed securities. There is no guarantee that the Fund will meet its stated objective.

Forward Strategic Alternatives Fund:
Strategic Alternatives Fund is not a diversified fund and investors will indirectly bear the expenses of the fund’s underlying investments. The underlying investments of the Strategic Alternatives Fund (such as structured notes, derivatives, commodities and levered Exchange Traded Funds or ETFs) may involve heightened risks related to liquidity, increased volatility, and unfavorable fluctuations in currency values. The underlying international and real estate investments may also be subject to economic or political instability in the US and other countries, credit risk and interest rate fluctuations.

Forward International Equity:
Investing in foreign securities, especially emerging and frontier markets, will involve additional risks, including exchange rate fluctuation, social and political instability, less liquidity, greater volatility and less regulation.

Forward Investment Grade Fixed Income:
When investing in bonds, you are subject, but not limited to, the same interest rate, inflation and credit risks associated with the underlying bonds owned by the Fund.

Forward Aggressive Growth Allocation Fund:
Investing involves risk, including possible loss of principal. When investing in small cap stocks you may notice greater fluctuations in market value. By investing in international stocks, including emerging markets and frontier markets, you may be subject to currency fluctuations and political and economic instability. Return of principal is not guaranteed. The underlying investments of the Forward Frontier Markets and Strategic Alternatives Funds (such as structured notes, derivatives, commodities and levered Exchange Traded Funds or ETFs) will involve heightened risks related to liquidity, increased volatility, and unfavorable fluctuations in currency values. The underlying international and real estate investments of the Frontier Markets and Strategic Alternatives Funds may also be subject to economic or political instability in the US and other countries, credit risk and interest rate fluctuations. U.S. Government Money: Certain Government Sponsored Enterprises (such as Freddie Mac, Fannie Mae, and FHLB) although sponsored or chartered by the U.S. Government are not funded by the U.S. Government and the securities they issue are not guaranteed by the U.S. Government. An investment in the U.S. Government Money Fund is not insured or guaranteed by the Federal Deposit Insurance Corporation or any other government agency. Although the Fund seeks to preserve the value of your investment at $1.00 per share, it is possible to lose money by investing in this Fund.

Forward Growth Allocation Fund, Forward Growth & Income Allocation Fund, Forward Income & Growth Allocation Fund, Forward Income Allocation Fund, Forward Balanced Allocation Fund:
Investing involves risk, including possible loss of principal. When investing in small cap stocks you may notice greater fluctuations in market value. By investing in international stocks, including emerging markets and frontier markets, you may be subject to currency fluctuations and political and economic instability. By investing in high yield bonds you may be subjected to greater price volatility based on fluctuations in issuer and credit quality. When investing in bonds, you are subject, but not limited to, the same interest rate, inflation and credit risks associated with the underlying bonds owned by the Fund. Mortgage backed securities are subject to prepayment and extension risk and therefore react differently to changes in interest rates than other bonds. Small movements in interest rates may quickly and significantly reduce the value of certain mortgage-backed securities. Return of principal is not guaranteed. The underlying investments of the Forward Frontier Markets and Strategic Alternatives Funds (such as structured notes, derivatives, commodities and levered Exchange Traded Funds or ETFs) will involve heightened risks related to liquidity, increased volatility, and unfavorable fluctuations in currency values. The underlying international and real estate investments of the Frontier Markets and Strategic Alternatives Funds may also be subject to economic or political instability in the US and other countries, credit risk and interest rate fluctuations. U.S. Government Money: Certain Government Sponsored Enterprises (such as Freddie Mac, Fannie Mae, and FHLB) although sponsored or chartered by the U.S. Government are not funded by the U.S. Government and the securities they issue are not guaranteed by the U.S. Government. An investment in the U.S. Government Money Fund is not insured or guaranteed by the Federal Deposit Insurance Corporation or any other government agency. Although the Fund seeks to preserve the value of your investment at $1.00 per share, it is possible to lose money by investing in this Fund.

US Government Money Market Fund:
An investment in the U.S. Government Money Fund is not insured or guaranteed by the Federal Deposit Insurance Corporation or any other government agency. Although the Fund seeks to preserve the value of your investment at $1.00 per share, it is possible to lose money by investing in this Fund.

There are risks involved with investing, including loss of principal. Past performance does not guarantee future results, share prices will fluctuate, and you may have a gain or loss when you redeem shares.

Each allocation fund is a fund of funds, which is a mix of underlying Accessor Funds. Shareholders of the allocation funds indirectly bear the expenses of the Underlying Funds. The Funds’ current actual allocations may differ due to market fluctuations and other factors. Forward Management has the discretion to change the Funds’ allocations.