united states
securities and exchange commission
washington, d.c. 20549

form n-csr

certified shareholder report of registered management
investment companies

Investment Company Act file number 811-22756

Advisors Preferred Trust

(Exact name of registrant as specified in charter)

4221 North 203rd Street, Suite 100, Elkhorn, NE  68022

(Address of principal executive offices) (Zip code)

The Corporation Trust Company, 1209 Orange Street, Wilmington, DE  19801

(Name and address of agent for service)

Registrant's telephone number, including area code: 631-470-2600

Date of fiscal year end: 8/31

Date of reporting period: 8/31/22

Item 1. Reports to Stockholders.

 

Hundredfold Select Alternative Fund 

ANNUAL REPORT

August 31, 2022

Service Class (SFHYX) 

Investor Class (HFSAX)

1-855-582-8006

www.HundredfoldSelect.com

Distributed by Ceros Financial Services, Inc.

October 26, 2022 

Dear Shareholders:

This annual report for the Hundredfold Select Alternative Fund (HFSAX Investor Class and SFHYX Service Class) covers the period from September 1, 2021 – August 31, 2022. The Hundredfold Select Alternative Fund Investor Class Shares declined by -6.64%, while the Bloomberg Aggregate Bond Index declined by -11.52% for the period. The Standard & Poor’s 500 Total Return Index fell by -11.23%. The Hundredfold Select Alternative Fund Service Class Shares declined by -7.51 % during this time.

In September 2021, the Federal Reserve indicated they were ready to begin tapering. The closely watched 10-year and 30-year Treasuries declined as rates rose. This rippled through other assets as the dollar climbed and equities were pressured. The Fund trimmed exposure to high yield and added to its floating rate bond positions; it also reduced its commodities positions during the month. Supply chain issues continued to limit economic activity as high demand was not met by available goods and services in October, and the ensuing scarcity furthered inflation. The uncertainty resulted in a jagged bond market. The Fund modestly increased exposure to high yield bonds on early signs of technical improvement, but the positive indicators waned, and the Fund reduced its positions.

Economic sensitive bond sectors and equities pushed higher in November. But, by mid-month, momentum had begun to fade, and volatility increased. The Fund built on its high yield bond position early in the month, but quickly eliminated the holding as traction slipped. Floating rate investments had been climbing higher for most of the year though a loss of momentum caused the Sub-advisor to pare the position. The Sub-advisor increased municipal bond exposure while it decreased diversified bond holdings in the ‘bond/other’ category. Many ‘risk-on’ asset classes, including fixed income and equities, rebounded in December. The Fund boosted its high yield bond holdings early in the month, and then added to its floating rate positions later in the month.

The ‘risk-on’ bond and stock assets pulled back sharply in January. The short end of the yield curve rose faster than the longer end, which resulted in headwinds to bonds and stocks. The Fund reduced its high yield bond positions, increased them again temporarily through tactical trades, and then reduced them back to zero by month end. The Sub-advisor raised positions in floating rate investments and made tactical equity trades while keeping an eye on volatility. Interest sensitive classes were under pressure early in the month with ragged mid-month pricing. Headlines shifted late in the month to geopolitical events, causing investors to seek the assumed safety of ‘risk-off’ bonds. Bond classes, such as floating rate, high yield, convertibles and preferreds, that are usually tied to the strength of the economy were less in step with each other. The Sub-advisor cut positions early in the month to floating rate and securitized credit and put on high yield positions.

Fixed income markets started the month of March on a sour note as the late February bounce lost momentum and traders quickly sold in response to the failed pattern. Many of the economically sensitive classes such as high yield, floating rate, and convertible bonds, found their footing around mid-month and had snap-back rallies to recoup some of the earlier losses. The Fund initiated positions to high yield and floating rate bonds and eliminated its positions in securitized credit funds. Volatility in equities warranted tactical equity trades with exposure reaching zero at times. Investor concerns extended into April as the war in Ukraine and ongoing shutdowns in China fueled fears of continued supply chain challenges. The Federal Reserve was in the early stage of rate increases. Investors were uncertain whether the Fed could battle inflation without slowing the economy down to the point of recession. With poor technical trends in force, the Fund remained solidly in a defensive stance. The

1

Sub-advisor began the month with light high yield exposure eventually moving out of these positions to cash. Floating rate investments that rebounded sharply in March, reversed course and lost enough ground to cause the Sub-advisor to trim these holdings as well.

The bond market improved in May by becoming less negative. Reports of slowing demand in housing and a decline of -1.5% in gross domestic product in the first quarter suggested that the Federal Reserve could slow inflation, a major headwind to bonds and equities. The Sub-advisor initiated smaller positions in high yield bonds. With the continued backdrop of decreasing liquidity and rising interest rates, in June investors anticipated an increased risk of recession. As a result, they continued to back away from risk-on fixed income and equities. A modest rebound in risk-off bonds during the second half of the month was not enough to change the intermediate-term downtrends. The Fund began the month with modest high yield exposure but the improved momentum late in May turned negative in early June, resulting in the Sub-advisor exiting to cash. Exposure to floating rate was also tactically brief.

Bond and stock markets improved in July in contrast to the negative trend in place since the beginning of 2022. The Federal Reserve FOMC meeting resulted in a 75-basis point increase in the federal funds rate that investors seemingly interpreted as a potential antidote to the rapid inflation rate. The Fund began the month in a defensive stance. By month end, the Fund’s investment levels were mild relative to historic levels but reflected technical improvements in several categories. Exposure increased primarily in municipal bonds (high yield and non-high yield sub-classes), high yield corporates, and floating rate bank loans. While still in macro downtrends, momentum in equities improved to warrant tactical trades.

Investor sentiment continued to be optimistic as August began. Perhaps sparked by profit-taking and increased rhetoric of a potential recession, fixed income and equity risk assets lost momentum around mid-month. Selling pressure intensified in response to Fed Chairman Powell’s speech at the Jackson Hole symposium that highlighted a firm commitment to fighting inflation even if it may require “below trend growth.” During the month, the Fund increased exposure to floating rate bank loan investments and reduced exposure to high yield and municipal bonds resulting in a lighter fixed income portion of the portfolio. Equity holdings were reduced as resistance was felt around key technical levels and momentum turned from positive to negative. Commodities have many sub-classes with their own trading dynamics warranting a mixture of long and short exposures throughout the year. The Fund uses swaps and futures as substitutes for various underlying reference assets to achieve part of its returns.

We thank you for your investment in the Hundredfold Select Alternative Fund. Please visit the website http://www.hundredfoldselect.com at any time for information on the Fund.

Hundredfold Advisors, LLC	Advisors Preferred, LLC
Sub-advisor to the Fund	Advisor to the Fund

2

Hundredfold Select Alternative Fund

PORTFOLIO REVIEW (Unaudited)

Average Annual Total Return through August 31, 2022*, as compared to its benchmarks:

				Since	Since
				Inception	Inception
	1 Year	5 Year	10 Year	September 1, 2004	October 24, 2012
Hundredfold Select Alternative Fund - Service Class	(7.51)%	8.36%	6.74%	6.47%	N/A
Hundredfold Select Alternative Fund - Investor Class	(6.64)%	9.36%	N/A	N/A	7.62%
Bloomberg U.S Aggregate Bond Index **	(11.52)%	0.52%	1.35%	3.19%	1.36%
S&P 500 Total Return Index ***	(11.23)%	11.82%	13.08%	9.51%	13.23%

* The performance data quoted is historical. Past performance is no guarantee of future results. Current performance may be higher or lower than the performance data quoted. The principal value and investment return of an investment will fluctuate so that your shares, when redeemed, may be worth more or less than their original cost. The returns shown do not reflect the deduction of taxes that a shareholder would pay on Fund distributions or on the redemptions of Fund shares. The Fund’s total annual operating expenses are 2.66% for the Service Class and 1.71% for the Investor Class per the most recent prospectus. For performance information current to the most recent month-end, please call 1-855-582-8006.

** The Bloomberg U.S. Aggregate Bond Index is an unmanaged index which represents the U.S. investment-grade fixed-rate bond market (including government and corporate securities, mortgage pass-through securities and asset-backed securities). Investors cannot invest directly in an index or benchmark.

*** The S&P 500 Total Return Index is an unmanaged composite of 500 large capitalization companies and includes the reinvestment of dividends. This index is widely used by professional investors as a performance benchmark for large-cap stocks. Investors cannot invest directly in an index.

Comparison of the Change in Value of a $10,000 Investment

3

Hundredfold Select Alternative Fund

PORTFOLIO REVIEW (Unaudited) (Continued)

Comparison of the Change in Value of a $1,000,000 Investment

Holdings By Security Type *	% of Net Assets
Open End Fund - Fixed Income		0.0	%!
U.S. Government & Agencies		61.2	%
Short-Term Investments		31.4	%
Other Assets in Excess of Liabilities		7.4	%
Total		100.0	%

* Does not include derivative exposure.

Please refer to the Consolidated Schedule of Investments in this annual report for a detailed analysis of the Fund’s holdings.

! Percentage rounds to less than 0.1%.

4

Hundredfold Select Alternative Fund

CONSOLIDATED SCHEDULE OF INVESTMENTS

August 31, 2022

Shares			Fair Value
		OPEN-END FUND — 0.0%(a)
		FIXED INCOME - 0.0%(a)
	658	Nuveen High Yield Municipal Bond Fund, Class I	$	10,334
		TOTAL OPEN-END FUND (Cost $11,648)		10,334

Principal Amount ($)			Coupon Rate (%)	Maturity
		U.S. GOVERNMENT & AGENCIES — 61.2%
		U.S. TREASURY BILLS — 61.2%
	90,365,000	United States Cash Management Bill(b)	—	09/27/22	90,216,346
	85,000,000	United States Treasury Bill(b)	—	11/17/22	84,512,700
					174,729,046
		TOTAL U.S. GOVERNMENT & AGENCIES (Cost $174,803,086)			174,729,046

Shares
		SHORT-TERM INVESTMENTS — 31.4%
		MONEY MARKET FUNDS - 31.4%
	83,360,980	Fidelity Government Portfolio Institutional Class, Class I, 2.03%(c)		83,360,980
	6,235,568	First American Government Obligations Fund Class X, Class X, 2.04%(c)		6,235,568
		TOTAL MONEY MARKET FUNDS (Cost $89,596,548)		89,596,548
		TOTAL SHORT-TERM INVESTMENTS (Cost $89,596,548)		89,596,548
		TOTAL INVESTMENTS - 92.6% (Cost $264,411,282)	$	264,335,928
		OTHER ASSETS IN EXCESS OF LIABILITIES - 7.4%		21,290,435
		NET ASSETS - 100.0%	$	285,626,363

OPEN LONG FUTURES CONTRACTS
Number of Contracts		Open Long Futures Contracts	Counterparty	Expiration	Notional Amount(d)		Unrealized (Depreciation)
	214	CBOT Corn Future(e)	ADM	12/14/2022	$	7,174,350	$	(97,437	)
	172	CBOT Wheat Future(e)	ADM	12/14/2022		7,150,900		(123,275	)
		TOTAL LONG FUTURES CONTRACTS					$	(220,712	)

See accompanying notes to consolidated financial statements.

5

Hundredfold Select Alternative Fund

CONSOLIDATED SCHEDULE OF INVESTMENTS (Continued)

August 31, 2022

OPEN SHORT FUTURES CONTRACTS
Number of					Notional		Unrealized Appreciation
Contracts		Open Short Futures Contracts	Counterparty	Expiration	Amount(d)		(Depreciation)
	129	CME Japanese Yen Currency Future	ADM	09/19/2022	$	11,639,025	$	142,626
	83	COMEX Gold 100 Troy Ounces Future(e)	ADM	12/28/2022		14,327,460		75,690
	296	ICE US MSCI Emerging Markets EM Index Futures	ADM	09/16/2022		14,532,120		(66,245	)
		TOTAL SHORT FUTURES CONTRACTS					$	152,071

ADM ADM Investor Services

(a)	Percentage rounds to less than 0.1%.
(b)	Zero coupon bond.
(c)	Rate disclosed is the seven-day effective yield as of August 31, 2022.
(d)	The amounts shown are the underlying reference notional amounts to stock exchange indices and equities upon which the fair value of the futures contracts held by the Fund are based. Notional values do not represent the current fair value of, and are not necessarily indicative of the future cash flows of the Fund’s futures contracts. Further, the underlying price changes in relation to the variables specified by the notional values affects the fair value of these derivative financial instruments. The notional values as set forth within this schedule do not purport to represent economic value at risk to the Fund.
(e)	All or a portion of this investment is a holding of the Hundredfold Select Alternative Fund Limited (HFSA Fund Limited).

TOTAL RETURN SWAPS
			Notional					Unrealized
Number of			Amount at			Termination		Appreciation
Shares		Reference Entity	August 31, 2022		Interest Rate Payable (1)	Date	Counterparty	(Depreciation)
Long Position:
	3,113,709	BlackRock Floating Rate Income Fund, Class K	$	29,642,508	USD-SOFR plus 165 bp	7/21/2025	BRC	$	367,863
	4,746,032	Credit Suisse Floating Rate High Income Fund, Institutional Class		30,089,841	USD-Federal Funds-H.15 plus 165 bp	9/5/2023	CIBC		319,204
	4,375,918	Invesco Senior Floating Rate Fund, Class R6		29,624,963	USD-SOFR plus 165 bp	8/12/2025	BRC		(167,894	)
	1,827,628	Nuveen High Yield Municipal Bond Fund Class R6		28,712,042	USD-SOFR plus 165 bp	8/1/2025	BRC		(1,175,098	)
						Total:		$	(655,925	)

BRC - Barclays Capital

CIBC - Canadian Imperial Bank of Commerce

SOFR - Secured Overnight Financing Rate

⁽¹⁾ Interest rate is based upon current notional amounts, which may be a multiple of the number of shares plus a specified spread.

See accompanying notes to consolidated financial statements.

6

Hundredfold Select Alternative Fund

CONSOLIDATED STATEMENT OF ASSETS AND LIABILITIES

August 31, 2022

Assets:
Investment securities:
At cost	$	264,411,282
At value	$	264,335,928
Cash collateral for swaps		10,050,000
Deposits with brokers for futures		9,396,003
Deposits with brokers for swaps		3,465,842
Unrealized appreciation on swap contracts - OTC		687,067
Unrealized appreciation on futures		218,316
Receivable:
Dividends and interest		430,988
Fund shares sold		393,678
Prepaid expenses and other assets		46,134
Total Assets		289,023,956
Liabilities:
Unrealized depreciation on swap contracts - OTC		1,342,992
Payable for swaps		1,254,124
Unrealized depreciation on futures		286,957
Payables:
Investment advisory fees		251,880
Fund shares redeemed		92,322
Distributions (12b-1) fees - Service Class		90,612
Shareholder servicing fees - Investor Class		57,980
Related parties		20,726
Total Liabilities		3,397,593
Net Assets	$	285,626,363
Net Assets Consist of:
Paid in Capital	$	304,377,252
Accumulated Deficit		(18,750,889	)
Net Assets	$	285,626,363
Net Asset Value Per Share
Service Class Shares:
Net Assets	$	90,348,633
Shares of beneficial interest outstanding (no par value; unlimited shares authorized)		3,907,832
Net asset value, (Net Assets ÷ Shares Outstanding), offering and redemption price per share	$	23.12
Investor Class Shares:
Net Assets	$	195,277,730
Shares of beneficial interest outstanding (no par value; unlimited shares authorized)		7,957,809
Net asset value, (Net Assets ÷ Shares Outstanding), offering and redemption price per share	$	24.54

See accompanying notes to consolidated financial statements.

7

Hundredfold Select Alternative Fund

CONSOLIDATED STATEMENT OF OPERATIONS

For the Year Ended August 31, 2022

Investment Income:
Dividend income	$	3,038,042
Interest income		948,767
Total Investment Income		3,986,809
Expenses:
Investment advisory fees		2,871,149
Distribution (12b-1) fees - Service Class		979,118
Operating services fees		445,934
Shareholder servicing fees - Investor Class		113,490
Miscellaneous expense		9,000
Net Operating Expenses		4,418,691
Net Investment Loss		(431,882	)
Realized and Unrealized Gain (Loss) on Investments, Futures and Swaps
Net realized gain (loss) from:
Investments		3,752,716
Long-term capital gains distributions from underlying investment companies		222,671
Futures		(11,274,252	)
Swaps		(4,633,547	)
		(11,932,412	)
Net change in unrealized appreciation (depreciation) on:
Investments		(6,542,005	)
Futures		(1,732,383	)
Swaps		(1,762,500	)
		(10,036,888	)
Net Realized and Unrealized Loss on Investments, Futures and Swaps		(21,969,300	)
Net Decrease in Net Assets Resulting From Operations	$	(22,401,182	)

See accompanying notes to consolidated financial statements.

8

Hundredfold Select Alternative Fund

CONSOLIDATED STATEMENTS OF CHANGES IN NET ASSETS

	Year Ended			Year Ended
	August 31, 2022			August 31, 2021
Operations:
Net investment income (loss)	$	(431,882	)	$	442,294
Net realized gain (loss) from investments, futures and swaps		(12,155,083	)		29,044,495
Long-term capital gains distributions from underlying investment companies		222,671			12,611
Net change in unrealized appreciation (depreciation) on investments, futures and swaps		(10,036,888	)		2,956,059
Net Increase (Decrease) in Net Assets Resulting From Operations		(22,401,182	)		32,455,459
Distributions to Shareholders from:
Total Distributions Paid
Service Class		(9,740,073	)		(8,332,999	)
Investor Class		(17,037,860	)		(6,400,172	)
Total Distributions to Shareholders		(26,777,933	)		(14,733,171	)
Capital share transactions:
Proceeds from shares sold:
Service Class		21,691,375			44,750,891
Investor Class		148,517,126			228,856,472
Net asset value of shares issued in reinvestment of distributions:
Service Class		9,055,102			7,715,641
Investor Class		15,140,999			4,448,946
Payments for shares redeemed
Service Class		(28,157,450	)		(15,842,981	)
Investor Class		(156,766,926	)		(64,011,161	)
Total Increase in Net Assets From Shares of Beneficial Interest		9,480,226			205,917,808
Total Increase (Decrease) in Net Assets		(39,698,889	)		223,640,096
Net Assets:
Beginning of Year		325,325,252			101,685,156
End of Year	$	285,626,363		$	325,325,252
Share Activity
Service Class:
Shares Sold		862,932			1,716,643
Shares issued in reinvestment of Distributions		354,803			329,166
Shares Redeemed		(1,122,382	)		(591,126	)
Net Increase in Shares of Beneficial Interest Outstanding		95,353			1,454,683
Share Activity
Investor Class:
Shares Sold		5,572,270			8,199,658
Shares issued in reinvestment of Distributions		562,151			179,998
Shares Redeemed		(5,735,653	)		(2,222,930	)
Net Increase in Shares of Beneficial Interest Outstanding		398,768			6,156,726

See accompanying notes to consolidated financial statements.

9

Hundredfold Select Alternative Fund

FINANCIAL HIGHLIGHTS

Per Share Data and Ratios for a Share of Beneficial Interest Outstanding Throughout each Year

	Service Class
	Year Ended August 31,
	2022			2021			2020			2019			2018
	(Consolidated)			(Consolidated)			(Consolidated)			(Consolidated)			(Consolidated)
Net asset value, beginning of year	$	27.54		$	26.55		$	21.72		$	21.86		$	23.10
Income (loss) from investment operations:
Net investment income (loss) (1)		(0.18	)		(0.10	)		(0.12	)		0.07			(0.10	)
Net realized and unrealized gain on investments		(1.68	)		4.56			5.92			0.35			0.99
Total from investment operations		(1.86	)		4.46			5.80			0.42			0.89
Less distributions from:
Net investment income		(1.19	)		(1.38	)		(0.42	)		(0.09	)		(0.53	)
Net realized gains		(1.37	)		(2.09	)		(0.55	)		(0.47	)		(1.60	)
Total distributions		(2.56	)		(3.47	)		(0.97	)		(0.56	)		(2.13	)
Net asset value, end of year	$	23.12		$	27.54		$	26.55		$	21.72		$	21.86
Total return (2)		(7.51	)%		19.09	%		27.84	%		2.01	%		4.03	%
Net assets, at end of year (000s)	$	90,349		$	104,988		$	62,606		$	42,559		$	40,192
Ratios/Supplemental Data:
Ratio of net expenses to average net assets (3)		2.16	%		2.22	%		2.40	%		2.45	%		2.45	%
Ratio of net investment income (loss) to average net assets (3,4)		(0.71	)%		(0.39	)%		(0.51	)%		0.33	%		(0.47	)%
Portfolio Turnover Rate (5)		332	%		51	%		515	%		488	%		505	%

⁽¹⁾ Net investment income (loss) per share represents net investment income (loss) divided by the daily average shares of beneficial interest outstanding throughout each year.

⁽²⁾ All returns reflect reinvested dividends, if any, but do not reflect the impact of taxes.

⁽³⁾ The ratios of expenses to average net assets and net investment income (loss) to average net assets do not reflect the expenses of the underlying investment companies in which the Fund invests.

⁽⁴⁾ Recognition of net investment income by the Fund is affected by the timing of the declaration of dividends by the underlying investment companies in which the Fund invests.

⁽⁵⁾ The Fund’s portfolio turnover is calculated without regard to short-term securities having a maturity of less than one year. Investments in options, swaps, and futures contracts and repurchase agreements are deemed short-term securities. The Fund’s aggressive investment strategy may result in significant portfolio turnover to take advantage of anticipated changes in market conditions.

See accompanying notes to consolidated financial statements.

10

Hundredfold Select Alternative Fund

FINANCIAL HIGHLIGHTS

Per Share Data and Ratios for a Share of Beneficial Interest Outstanding Throughout each Year

	Investor Class
	Year Ended August 31,
	2022			2021			2020			2019			2018
	(Consolidated)			(Consolidated)			(Consolidated)			(Consolidated)			(Consolidated)
Net asset value, beginning of year	$	29.15		$	27.87		$	22.83		$	22.88		$	24.09
Income (loss) from investment operations:
Net investment income (1)		0.04	(6)		0.15			0.08			0.29			0.09
Net realized and unrealized gain on investments		(1.76	)		4.80			6.22			0.36			1.04
Total from investment operations		(1.72	)		4.95			6.30			0.65			1.13
Less distributions from:
Net investment income		(1.52	)		(1.58	)		(0.71	)		(0.23	)		(0.74	)
Net realized gains		(1.37	)		(2.09	)		(0.55	)		(0.47	)		(1.60	)
Total distributions		(2.89	)		(3.67	)		(1.26	)		(0.70	)		(2.34	)
Net asset value, end of year	$	24.54		$	29.15		$	27.87		$	22.83		$	22.88
Total return (2)		(6.64	)%		20.18	%		29.04	%		2.95	%		4.94	%
Net assets, at end of year (000s)	$	195,277		$	220,337		$	39,079		$	12,490		$	14,026
Ratios/Supplemental Data:
Ratio of net expenses to average net assets (3)		1.22	%		1.27	%		1.45	%		1.55	%		1.55	%
Ratio of net investment income to average net assets (3,4)		0.14	%		0.53	%		0.34	%		1.24	%		0.40	%
Portfolio Turnover Rate (5)		332	%		51	%		515	%		488	%		505	%

⁽¹⁾ Net investment income (loss) per share represents net investment income (loss) divided by the daily average shares of beneficial interest outstanding throughout each year.

⁽²⁾ All returns reflect reinvested dividends, if any, but do not reflect the impact of taxes.

⁽³⁾ The ratios of expenses to average net assets and net investment income (loss) to average net assets do not reflect the expenses of the underlying investment companies in which the Fund invests.

⁽⁴⁾ Recognition of net investment income (loss) by the Fund is affected by the timing of the declaration of dividends by the underlying investment companies in which the Fund invests.

⁽⁵⁾ The Fund’s portfolio turnover is calculated without regard to short-term securities having a maturity of less than one year. Investments in options, swaps, and futures contracts and repurchase agreements are deemed short-term securities. The Fund’s aggressive investment strategy may result in significant portfolio turnover to take advantage of anticipated changes in market conditions.

⁽⁶⁾ The amount of net investment income per share does not accord with the amount reported in the Statement of Operations due to the timing of shareholder transactions.

See accompanying notes to consolidated financial statements.

11

Hundredfold Select Alternative Fund

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

August 31, 2022

1. ORGANIZATION

The Hundredfold Select Alternative Fund (the “Fund”) is a diversified series of Advisors Preferred Trust, a Delaware statutory trust (the “Trust”) organized on August 15, 2012 and registered under the Investment Company Act of 1940, as amended (the “1940 Act”), as an open-end management investment company. The Fund currently offers Service Class Shares and Investor Class Shares with commencement of operations on September 1, 2004 and October 24, 2012, respectively. The Fund was reorganized on August 9, 2019 from a predecessor fund to a series of Advisors Preferred Trust, a Delaware statutory trust.

Each class represents an interest in the same assets of the respective Fund and classes are identical except for differences in their ongoing service and distribution charges. All classes of shares have equal voting privileges except that each class has exclusive voting rights with respect to its service and/or distribution plans. The Fund’s income, expenses (other than class specific distribution and shareholding servicing fees) and realized and unrealized gains and losses are allocated proportionately each day based upon the relative net assets of each class.

The Fund seeks a moderate total rate of return (income plus capital appreciation) on an annual basis. Although the Fund may invest directly in equity and fixed-income securities, it will primarily invest in such securities indirectly through securities that invest in or are a derivative of such securities, primarily including futures contracts, swap agreements, exchange-traded funds (ETFs), naked and covered options on such instruments, currencies, and other unaffiliated investment companies.

2. SIGNIFICANT ACCOUNTING POLICIES

The following is a summary of significant accounting policies followed by the Fund in preparation of its financial statements. The policies are in conformity with generally accepted accounting principles in the United States of America (“GAAP”). The Fund follows the specialized accounting and reporting requirements under GAAP that are applicable to investment companies. The preparation of the financial statements requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of increase and decrease in net assets from operations during the fiscal year. Actual results could differ from those estimates. The Fund is an investment company and accordingly follows the investment company accounting and reporting guidance of the Financial Accounting Standards Board’s (“FASB”) Accounting Standards Codification Topic 946 “Financial Services – Investment Companies”.

a) Investment Valuation – Securities listed on an exchange are valued at the last reported sale price at the close of the regular trading session of the exchange on the business day the value is being determined, or in the case of securities listed on NASDAQ at the NASDAQ Official Closing Price (“NOCP”). If the NOCP is not available, such securities shall be valued at the last bid on the day of valuation. Financial futures, which are traded on an exchange, are valued at the last quoted sales price determined by the exchange. Investments in open-end investment companies are valued at net asset value. Total return swaps on exchange-listed securities shall be valued at the last quoted sales price or, in the absence of a sale, at the mean between the current bid and ask prices. Exchange listed swaps shall be valued at the last quoted sales price or, in the absence of a sale, at the mean between the current bid and ask prices. Credit default swaps are valued by a pricing agent covering the specific type of swap. Certain credit default swaps (“CDS”) and credit indices are valued independently by Markit; or if no valuation is available from a pricing agent, at the price received from the broker-dealer/counterparty that issued the swap. The independent pricing service does not distinguish between smaller-sized bond positions known as “odd lots” and larger institutional-sized bond positions known as “round lots”. The Fund may fair value a particular bond if the adviser does not believe that the round lot value provided by the independent pricing service reflects fair value of the Fund’s holding. Short-term debt obligations having 60 days or less remaining until maturity, at time of purchase, may be valued at amortized cost.

The Fund may hold securities, such as private investments, interests in commodity pools, other non-traded securities or temporarily illiquid securities, for which market quotations are not readily available or are determined to be unreliable. These securities will be valued using the “fair value” procedures approved by the Trust’s Board of Trustees (the “Board”). The Board has delegated execution of these procedures to a fair value committee composed of one or more representatives from each of the (i) Trust, (ii) administrator, and (iii) advisor and/or sub-advisor. The committee may also enlist third party consultants such as a valuation specialist at a public accounting firm, valuation consultant or financial officer of a security issuer on an as-needed basis to assist in determining a security-specific fair value. The Board has also engaged a third party valuation firm to attend valuation meetings held by the Trust, review minutes of such meetings and report to the Board on a quarterly basis. The Board reviews and ratifies the execution of this process and the resultant fair value prices at least quarterly to assure the process produces reliable results.

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Hundredfold Select Alternative Fund

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (Continued)

August 31, 2022

b) Fair Valuation Process – As noted above, the fair value committee is composed of one or more representatives from each of the (i) Trust, (ii) administrator, (iii) advisor and/or sub-advisor. The applicable investments are valued collectively via inputs from each of these groups. For example, fair value determinations are required for the following securities: (i) securities for which market quotations are insufficient or not readily available on a particular business day (including securities for which there is a short and temporary lapse in the provision of a price by the regular pricing source), (ii) securities for which, in the judgment of the advisor and/or sub-advisor, the prices or values available do not represent the fair value of the instrument. Factors which may cause the advisor and/or sub advisor to make such a judgment include, but are not limited to, the following: only a bid price or an asked price is available; the spread between bid and asked prices is substantial; the frequency of sales; the thinness of the market; the size of reported trades; and actions of the securities markets, such as the suspension or limitation of trading; (iii) securities determined to be illiquid; (iv) securities with respect to which an event that will affect the value thereof has occurred (a “significant event”) since the closing prices were established on the principal exchange on which they are traded, but prior to a Fund’s calculation of its net asset value. Specifically, interests in commodity pools or managed futures pools are valued on a daily basis by reference to the closing market prices of each futures contract or other asset held by a pool, as adjusted for pool expenses. Restricted or illiquid securities, such as private investments or non-traded securities are valued via inputs from the advisor based upon the current bid for the security from two or more independent dealers or other parties reasonably familiar with the facts and circumstances of the security (who should take into consideration all relevant factors as may be appropriate under the circumstances). If the advisor and/or sub-advisor is unable to obtain a current bid from such independent dealers or other independent parties, the fair value committee shall determine the fair value of such security using the following factors: (i) the type of security; (ii) the cost at date of purchase; (iii) the size and nature of the Fund’s holdings; (iv) the discount from market value of unrestricted securities of the same class at the time of purchase and subsequent thereto; (v) information as to any transactions or offers with respect to the security; (vi) the nature and duration of restrictions on disposition of the security and the existence of any registration rights; (vii) how the yield of the security compares to similar securities of companies of similar or equal creditworthiness; (viii) the level of recent trades of similar or comparable securities; (ix) the liquidity characteristics of the security; (x) current market conditions; and (xi) the market value of any securities into which the security is convertible or exchangeable.

Valuation of Fund of Funds – The Fund may invest in portfolios of open-end or closed-end investment companies (the “Underlying Funds”). The Underlying Funds value securities in their portfolios for which market quotations are readily available at their market values (generally the last reported sale price) and all other securities and assets at their fair value to the methods established by the board of directors of the Underlying Funds.

Open-ended investment companies are valued at their respective net asset values as reported by such investment companies. The shares of many closed-end investment companies, after their initial public offering, frequently trade at a price per share, which is different than the net asset value per share. The difference represents a market premium or market discount of such shares. There can be no assurances that the market discount or market premium on shares of any closed-end investment company purchased by each Fund will not change.

The Fund utilizes various methods to measure the fair value of all of their investments on a recurring basis. GAAP establishes a hierarchy that prioritizes inputs to valuation methods. The three levels of input are:

Level 1 – Unadjusted quoted prices in active markets for identical assets and liabilities that each Fund has the ability to access.

Level 2 – Observable inputs other than quoted prices included in Level 1 that are observable for the asset or liability, either directly or indirectly. These inputs may include quoted prices for the identical instrument in an inactive market, prices for similar instruments, interest rates, prepayment speeds, credit risk, yield curves, default rates and similar data.

Level 3 – Unobservable inputs for the asset or liability, to the extent relevant observable inputs are not available; representing the Fund’s own assumptions about the assumptions a market participant would use in valuing the asset or liability, and would be based on the best information available.

The availability of observable inputs can vary from security to security and is affected by a wide variety of factors, including, for example, the type of security, whether the security is new and not yet established in the marketplace, the liquidity of markets, and other characteristics particular to the security. To the extent that valuation is based on models or inputs that are less observable or unobservable in the market, the determination of fair value requires more judgment. Accordingly, the degree of judgment exercised in determining fair value is greatest for instruments categorized in Level 3.

The inputs used to measure fair value may fall into different levels of the fair value hierarchy. In such cases, for disclosure purposes, the level in the fair value hierarchy within which the fair value measurement falls in its entirety, is determined based on the lowest level input that is significant to the fair value measurement in its entirety.

13

Hundredfold Select Alternative Fund

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (Continued)

August 31, 2022

The inputs or methodology used for valuing securities are not necessarily an indication of the risk associated with investing in those securities. The following tables summarize the inputs used as of August 31, 2022 for the Fund’s assets and liabilities measured at fair value:

Assets *	Level 1		Level 2		Level 3		Total
Investments
Open End Funds	$	10,334	$	—	$	—	$	10,334
U.S. Government & Agencies		—		174,729,046		—		174,729,046
Short-Term Investments		89,596,548		—		—		89,596,548
Total Investments	$	89,606,882	$	174,729,046	$	—	$	264,335,928
Derivatives
Futures Contracts	$	218,316	$	—	$	—	$	218,316
Swap Contracts		—		687,067		—		687,067
Total Derivatives	$	218,316	$	687,067	$	—	$	905,383
Total Assets	$	89,825,198	$	175,416,113	$	—	$	265,241,311
Liabilities
Derivatives
Futures Contracts	$	286,957	$	—	$	—	$	286,957
Swap Contracts		—		1,342,992		—		1,342,992
Total Liabilities	$	286,957	$	1,342,992	$	—	$	1,629,949

The Fund did not hold any Level 3 securities during the current year ended.

* Refer to the Consolidated Schedule of Investments for classification by asset class.

Consolidation of Subsidiaries – Hundredfold Select Alternative Fund Limited (“HFSA Fund Limited”)

The Consolidated Schedule of Investments, Consolidated Statement of Assets and Liabilities, Consolidated Statement of Operations and Consolidated Statement of Changes in Net Assets and the Consolidated Financial Highlights of the Hundredfold Select Alternative Fund include the accounts of HFSA Fund Limited, a wholly owned and controlled subsidiary. HFSA Fund Limited is a fund incorporated as an exempted company under the companies’ law of the Cayman Islands on June 19, 2018 and is a controlled foreign corporation for tax purposes. All inter-company accounts and transactions have been eliminated in consolidation.

The Hundredfold Select Alternative Fund may invest up to 25% of its total assets in a controlled foreign corporation (“CFC”) which acts as an investment vehicle in order to effect certain investments consistent with the Fund’s investment objectives and policies.

	Inception Date of	CFC Net Assets as of	% of Net Assets as of
	CFC	August 31, 2022	August 31, 2022
HFSA Fund Limited	6/19/2018	$ 9,778,142	3.4%

c) Swap Contracts – The Fund is subject to equity price risk, interest rate risk, credit risk and counterparty risk in the normal course of pursuing its investment objectives. The Fund may enter into various swap transactions, such as total return swaps and portfolio swaps for investment purposes or to manage interest rate, equity, or credit risk. These would be two-party contracts entered into primarily to exchange the returns (or differentials in rates of returns) earned or realized on particular pre-determined investments or instruments.

Standard equity swap contracts are between two parties that agree to exchange the returns (or differentials in rates of return) earned or realized on particular predetermined investments or instruments. The gross amount to be exchanged is calculated with respect to a “notional amount” (i.e. the return on or increase in value of a particular dollar amount invested in a “basket” of securities representing a particular index or industry sector). Most equity swap agreements entered into by the Fund calculate the obligations of the parties on a “net basis”. Consequently, a Fund’s current obligations under a swap agreement generally will be equal to the net amount to be paid or received under the agreement based on the relative value of the positions held by each party. The Fund’s obligations are accrued daily (offset by any amounts owed to the Fund).

14

Hundredfold Select Alternative Fund

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (Continued)

August 31, 2022

In a “long” equity swap agreement, the counterparty will generally agree to pay the Fund the amount, if any, by which the notional amount of the swap contract would have increased in value if the Fund has been invested in the particular securities, plus dividends that would have been received on those securities. The Fund will agree to pay the counterparty a floating rate of interest on the notional amount of the swap contract plus the amount, if any, by which the notional amount would have decreased in value had it been invested in such securities plus, in certain instances, commissions or trading spreads on the notional amounts. Thus, the return on the swap contract should be the gain or loss on the notional amount plus dividends on the securities less the interest paid by the Fund on the notional amount. However, in certain instances, market factors such as the interest rate environment and the demand to borrow the securities underlying the swap agreement can cause a scenario in which the counterparty will pay the Fund interest. Payments may be made at the conclusion of the contract or periodically during its term. Swap contracts do not include the delivery of securities. The net amount of the excess, if any, of the Fund’s obligations over its entitlement with respect to each swap is accrued on a daily basis and an amount of cash or liquid assets, having an aggregate net asset value at least equal to such accrued excess is maintained in a segregated account. Until a swap contract is settled in cash, the gain or loss on the notional amount plus dividends on the securities less the interest paid by the Fund on the notional amount are recorded as “unrealized gains or losses on swaps” and when cash is exchanged, the gain or loss is recorded as “realized gains or losses on swaps”.

The Fund may enter into swap contracts that provide the opposite return of the particular benchmark or security (“short” the index or security). The operations are similar to that of the swaps disclosed above except that the counterparty pays interest to the Fund on the notional amount outstanding and the dividends on the underlying securities reduce the return of the swap. However, in certain instances, market factors such as the interest rate environment and the demand to borrow the securities underlying the swap agreement can cause a scenario in which the Fund pays the counterparty interest. These amounts are netted with any unrealized appreciation or depreciation to determine the value of the swap. The Fund will typically enter into equity swap agreements in instances where the Advisor believes that it may be more cost effective or practical than buying a security or the securities represented by a particular index.

The Fund may enter into credit default swaps (“CDS”). CDS are typically two-party (bilateral) financial contracts that transfer credit exposure between the two parties. One party to a CDS (referred to as the credit protection “buyer”) receives credit protection or sheds credit risk, whereas the other party to a CDS (referred to as the credit protection “seller”) is selling credit protection or taking on credit risk. The seller typically receives pre-determined periodic payments from the other party. These payments are in consideration for agreeing to make compensating specific payments to the buyer should a negative credit event occur, such as (1) bankruptcy or (2) failure to pay interest or principal on a reference debt instrument, with respect to a specified issuer or one of the reference issuers in a CDS portfolio. In general, CDS may be used by the Fund to obtain credit risk exposure similar to that of a direct investment in high yield bonds.

The Fund may enter into Interest Rate Swaps. Interest rate swaps involve the exchange of commitments to pay and receive interest based on a notional principal amount. The Funds may elect to pay a fixed rate and receive a floating rate, or receive a fixed rate and pay a floating rate on a notional principal amount.

The amounts to be exchanged or “swapped” between parties are calculated with respect to the notional amount. Changes in the value of swap agreements are recognized as unrealized gains or losses in the Consolidated Statement of Operations by “marking to market” on a daily basis to reflect the value of the swap agreement at the end of each trading day. Payments received or paid at the beginning of the agreement are reflected as such on the Consolidated Statement of Assets and Liabilities and may be referred to as upfront payments. A liquidation payment received or made at the termination of the swap agreement is recorded as a realized gain or loss on the Consolidated Statement of Operations. The maximum pay-outs for these contracts are limited to the notional amount of each swap. CDS may involve greater risks than if a Fund had invested in the referenced obligation directly and are subject to general market risk, liquidity risk, counterparty risk and credit risk.

The Fund collateralizes swap agreements with cash and certain securities, if indicated on the Consolidated Schedule of Investments. Such collateral is held for the benefit of the counterparty in a segregated account at the Custodian to protect the counterparty against non-payment by the Fund. The Fund does not net collateral. In the event of a default by the counterparty, the Fund will seek return of this collateral and may incur certain costs exercising their rights with respect to the collateral. Amounts expected to be owed to the Fund are regularly collateralized either directly with the Fund or in a segregated account at the Custodian.

A Fund bears the risk of loss of the amount expected to be received under a swap agreement in the event of the default or bankruptcy of a swap agreement counterparty to the extent that posted collateral is insufficient. A Fund will enter into swap agreements only with large, well-capitalized and established financial institutions. The creditworthiness of each of the firms that is counterparty to a swap agreement is monitored by the Advisor. The financial statements of these counterparties may be available by accessing the SEC’s website, at www.sec.gov.

15

Hundredfold Select Alternative Fund

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (Continued)

August 31, 2022

d) Stock Index Futures Contracts and Options on Futures Contracts – The Fund may purchase and sell stock index futures contracts and options on such futures contracts. The Fund may use futures contracts to gain exposure to, or hedge against changes in the value of equities, interest rates, commodities or foreign currencies. Upon entering into a contract, the Fund deposits and maintains as collateral such initial margin as required by the exchange on which the transaction is effected. Pursuant to the contract, the Fund agrees to receive from or pay to the broker an amount of cash equal to the daily fluctuation in value of the contract. Such receipts or payments are known as “variation margin” and are recorded by the Fund as unrealized gains and losses. When the contract is closed, the Fund records a realized gain or loss equal to the difference between the value of the contract at the time it was opened and the value at the time it was closed. As collateral for futures contracts, the Fund is required under the 1940 Act to maintain assets consisting of cash, cash equivalents or liquid securities. This collateral is required to be adjusted daily to reflect the market value of the purchase obligation for long futures contracts or the market value of the instrument underlying the contract, but not less than the market price at which the futures contract was established, for short futures contracts.

e) Risks of Options, Futures Contracts, Options on Futures Contracts and Short Positions – The risks inherent in the use of options, futures contracts, options on futures contracts and short positions include 1) adverse changes in the value of such instruments; 2) imperfect correlation between the price of options and futures contracts and options thereon and movements in the price of the underlying securities, index or futures contracts; 3) the possible absence of a liquid secondary market for any particular instrument at any time; 4) the possible need to defer closing out certain positions to avoid adverse tax consequences; and 5) the possible nonperformance by the counterparty under the terms of the contract. The Fund designates all cash, cash equivalents and liquid securities as collateral for futures contracts and options on futures contracts.

f) Exchange Traded Funds – The Fund may invest in exchange traded funds (“ETFs”). Passive ETFs are a type of index fund bought and sold on a securities exchange. A passive ETF trades like common stock and represents a fixed portfolio of securities designed to track the performance and dividend yield of a particular domestic or foreign market index. A Fund may purchase an ETF to temporarily gain exposure to a portion of the U.S. or a foreign market while awaiting purchase of underlying securities. The risks of owning an ETF generally reflect the risks of owning the underlying securities they are designed to track, although the lack of liquidity on an ETF could result in it being more volatile. Additionally, ETFs have fees and expenses that reduce their value.

g) Security Transactions and Related Income – Investment transactions are recorded on the trade date. The Fund determines the gain or loss realized from the investment transactions by comparing the identified cost, which is the same basis used for federal income tax purposes, with the net sales proceeds. Dividend income is recorded on the ex-dividend date. Interest income, including amortization of premium and discount, and dividends received from money market funds, is recognized on an accrual basis. Upfront payments on Credit Default Swaps are amortized over the life of the contract.

h) Expenses – Expenses of the Trust that are directly identifiable to a specific fund are charged to that fund. Expenses, which are not readily identifiable to a specific fund, are allocated in such a manner as deemed equitable (as determined by the Board), taking into consideration the nature and type of expense and the relative sizes of the funds in the Trust.

i) Federal Income Taxes – The Fund continues to comply, and intends to continue, with the requirements of Subchapter M of the Internal Revenue Code necessary to qualify as a regulated investment company and to make the requisite distributions of income and capital gains to its shareholders sufficient to relieve it from all or substantially all federal income tax. No provision for federal income taxes has been made.

For tax purposes, HFSA Fund Limited (“HFSA”) is an exempted Cayman Islands investment company. HFSA has received an undertaking from the Government of the Cayman Islands exempting it from all local income, profits, and capital gains taxes. No such taxes are levied in the Cayman Islands at the present time. For U.S. income tax purposes, HFSA is a CFC and as such is not subject to U.S. income tax. However, as a wholly-owned CFC, the net income and capital gain of the CFC, to the extent of its earnings and profits, will be included each year in the respective Fund’s investment company taxable income.

The Fund recognizes the tax benefits of uncertain tax positions only where the position is “more likely than not” to be sustained assuming examination by tax authorities. Management has analyzed the Fund’s tax positions and has concluded that no liability for unrecognized tax benefits should be recorded related to uncertain tax positions taken on returns filed for open tax years ended August 31, 2019 through August 31, 2021 or expected to be taken in the Fund’s August 31, 2022 year-end tax returns.

j) Dividends and Distributions to Shareholders – Dividends from net investment income, if any, are declared and paid at least quarterly. Distributable net realized capital gains, if any, are declared and distributed annually. Dividends from net investment income on ex-date and distributions from net realized gains are determined in accordance with federal income tax regulations, which may differ from GAAP. These “book/tax” differences are considered either temporary (e.g., deferred losses, capital loss carry forwards) or permanent in nature. To the extent these differences are permanent in nature, such amounts are reclassified within the composition of net assets based on their federal tax-basis treatment; temporary differences do not require reclassification. Any such reclassifications will have no effect on net assets, results of operations, or net asset values per share of the Fund.

16

Hundredfold Select Alternative Fund

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (Continued)

August 31, 2022

k) Indemnifications – The Trust indemnifies its officers and trustees for certain liabilities that may arise from the performance of their duties to the Trust. Additionally, in the normal course of business, the Fund enters into contracts that contain a variety of representations and warranties and which provide general indemnities. The Fund’s maximum exposure under these arrangements is unknown, as this would involve future claims that may be made against the Fund that have not yet occurred. However, based on experience, the risk of loss due to these warranties and indemnities appears to be remote.

l) Market Risks – Unexpected local, regional or global events, such as war; acts of terrorism; financial, political or social disruptions; natural, environmental or man-made disasters; the spread of infectious illnesses or other public health issues; and recessions and depressions could have a significant impact on the Fund and its investments and may impair market liquidity. Such events can cause investor fear, which can adversely affect the economies of nations, regions and the market in general, in ways that cannot necessarily be foreseen. An outbreak of infectious respiratory illness known as COVID-19, which is caused by a novel coronavirus (SARS-CoV-2), was first detected in China in December 2019 and subsequently spread globally. This coronavirus has resulted in, among other things, travel restrictions, closed international borders, enhanced health screenings at ports of entry and elsewhere, disruption of and delays in healthcare service preparation and delivery, prolonged quarantines, significant disruptions to business operations, market closures, cancellations and restrictions, supply chain disruptions, lower consumer demand, and significant volatility and declines in global financial markets, as well as general concern and uncertainty. The impact of COVID-19 has adversely affected, and other infectious illness outbreaks that may arise in the future could adversely affect, the economies of many nations and the entire global economy, individual issuers and capital markets in ways that cannot necessarily be foreseen. Public health crises caused by the COVID-19 outbreak may exacerbate other pre-existing political, social and economic risks in certain countries or globally. The duration of the COVID-19 outbreak and its effects cannot be determined with certainty.

3. INVESTMENT AND DERIVATIVE TRANSACTIONS

For the year ended August 31, 2022, the aggregate purchases and sales of investments (excluding short-term investments, swaps and futures contracts) amounted to $228,459,143 and $425,292,232, respectively.

The Fund uses derivative instruments as part of its principal investment strategy to achieve its investment objective. For additional discussion on the risks associated with derivative instruments refer to Note 2. For the year ended August 31, 2022, the Fund invested in futures and swap contracts.

At August 31, 2022, the fair value of derivatives instruments was as follows:

Asset/Liability Derivatives

	Commodity risk			Credit risk			Currency risk		Equity risk			Total
Futures1	$	(145,022	)	$	—		$	142,626	$	(66,245	)	$	(68,641	)
Swap contracts2		—			(655,925	)		—		—			(655,925	)
Total	$	(145,022	)	$	(655,925	)	$	142,626	$	(66,245	)	$	(724,566	)

^1. Consolidated Statement of Assets and Liabilities location: Unrealized appreciation (depreciation) on futures.

^2. Consolidated Statement of Assets and Liabilities location: Unrealized appreciation (depreciation) on swap contracts.

Transactions in derivative instruments during the year ended August 31, 2022, were as follows:

	Commodity
	risk			Credit risk			Currency risk			Equity risk			Interest risk			Total
Realized gain (loss)3
Futures contracts	$	11,094,592		$	—		$	(555,392	)	$	(21,648,031	)	$	(165,421	)	$	(11,274,252	)
Swap contracts		—			(4,387,100	)		—			(246,445	)		—			(4,633,545	)
Total realized gain (loss)	$	11,094,592		$	(4,387,100	)	$	(555,392	)	$	(21,894,476	)	$	(165,421	)	$	(15,907,797	)
Change in unrealized appreciation (depreciation)4
Futures contracts	$	(351,456	)	$	—		$	142,626		$	(1,523,553	)	$	—		$	(1,732,383	)
Swap contracts		—			(1,675,213	)		—			(87,287	)		—			(1,762,500	)
Total change in unrealized appreciation (depreciation)	$	(351,456	)	$	(1,675,213	)	$	142,626		$	(1,610,840	)	$	—		$	(3,494,883	)

^3. Consolidated Statement of Operations location: Net realized gain (loss) on futures and swaps.

^4. Consolidated Statement of Operations location: Net change in unrealized appreciation (depreciation) on futures and swaps.

17

Hundredfold Select Alternative Fund

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (Continued)

August 31, 2022

The derivative instruments outstanding as of August 31, 2022, as disclosed in the Consolidated Schedule of Investments and the amounts of realized gain (loss) and changes in unrealized gains and losses on derivative instruments during the period as disclosed above and within the Consolidated Statement of Operations serve as indicators of the volume of derivative activity for the Fund.

4. OFFSETTING OF FINANCIAL ASSETS AND DERIVATIVE ASSETS AND LIABILITIES

The Fund’s policy is to recognize a net asset or liability equal to the unrealized gain/ (loss) for futures and gross asset or liability equal to unrealized gain/(loss) for swaps contracts. During the year ended August 31, 2022, the Fund is subject to a master netting arrangement for the swaps. The following table shows additional information regarding the offsetting of assets and liabilities at August 31, 2022.

				Gross Amounts		Net Amounts of			Gross Amounts Not Offset in the
				Offset in the		Assets Presented in			Consolidated Statement of Assets &
Assets:				Consolidated		the Consolidated			Liabilities
	Gross Amounts of			Statement of Assets		Statement of Assets &			Financial			Cash Collateral
	Recognized Assets			& Liabilities		Liabilities			Instruments			Received		Net Amount
Swaps Contracts - OTC	$	687,067		$	—	$	687,067		$	(687,067	)	$	—	$	—
Futures Contracts		218,316			—		218,316			(218,316	)		—		—
Total	$	905,383		$	—	$	905,383		$	(905,383	)	$	—	$	—
				Gross Amounts		Net Amounts of			Gross Amounts Not Offset in the
				Offset in the		Liabilities Presented in			Consolidated Statement of Assets &
Liabilities:	Gross Amounts of			Consolidated		the Consolidated			Liabilities
	Recognized			Statement of Assets		Statement of Assets &			Financial			Cash Collateral
Description	Liabilities			& Liabilities		Liabilities			Instruments			Pledged (1)		Net Amount
Swaps Contracts - OTC	$	(1,342,992	)	$	—	$	(1,342,992	)	$	687,067		$	655,925	$	—
Futures Contracts		(286,957	)		—		(286,957	)		218,316			68,641		—
Total	$	(1,629,949	)	$	—	$	(1,629,949	)	$	905,383		$	724,566	$	—

⁽¹⁾ The amount is limited to the derivative liability balance and accordingly does not include any additional collateral pledged.

5. AGGREGATE UNREALIZED APPRECIATION AND DEPRECIATION – TAX BASIS

The identified cost of investments in securities owned by the Fund for federal income tax purposes and gross unrealized appreciation and depreciation, including futures and swaps, at August 31, 2022, were as follows:

Tax		Unrealized		Unrealized			Appreciation/
Cost		Appreciation		(Depreciation)			(Depreciation)
$	264,487,769	$	128,602,208	$	(128,677,668	)	$	(75,460	)

6. DISTRIBUTIONS TO SHAREHOLDERS AND TAX COMPONENTS OF CAPITAL

The tax character of distributions paid during the following fiscal years was as follows:

	Fiscal Year Ended August 31, 2022		Fiscal Year Ended August 31, 2021
Ordinary Income	$	22,530,313	$	11,801,575
Long-Term Capital Gain		4,247,620		2,931,596
	$	26,777,933	$	14,733,171

18

Hundredfold Select Alternative Fund

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (Continued)

August 31, 2022

As of August 31, 2022, the components of distributable earnings/ (accumulated deficit) on a tax basis were as follows:

Undistributed		Undistributed		Post October Loss		Capital Loss			Other			Unrealized			Total
Ordinary		Long-Term		and		Carry			Book/Tax			Appreciation/			Distributable Earnings/
Income		Gains		Late Year Loss		Forwards			Differences			(Depreciation)			(Accumulated Deficit)
$	7,324,427	$	—	$	—	$	(25,854,834	)	$	(145,022	)	$	(75,460	)	$	(18,750,889	)

The difference between book basis and tax basis undistributed net investment income, accumulated net realized loss and unrealized depreciation from investments is primarily attributable to the tax deferral of losses on wash sales and the mark-to-market on open futures and swaps.

At August 31, 2022, the Funds had capital loss carry forwards for federal income tax purposes available to offset future capital gains as follows:

Short-Term		Long-Term		Total
$	15,812,999	$	10,041,835	$	25,854,834

Permanent book and tax differences, primarily attributable to the use of tax equalization and tax adjustments for the Fund’s wholly owned subsidiary, resulted in reclassifications for the Fund for the fiscal year ended August 31, 2022, as follows:

Paid
In		Accumulated
Capital		Deficit
$	323,473	$	(323,473	)

7. INVESTMENT ADVISORY AGREEMENT AND TRANSACTIONS WITH RELATED PARTIES

Advisors Preferred, LLC (“Advisor”), serves as investment advisor to the Fund.

Investment Advisory Agreement: The Fund has entered into an investment advisory agreement with the Advisor. The Advisor receives a fee, computed daily and payable monthly and applied to the Fund’s average daily net assets at an annual rate of 1.00%. In addition, the Advisor has entered into a sub-advisory agreement with Hundredfold Advisors, LLC (“Sub-Advisor”) whereby the Sub-Advisor will direct investment activities of the Fund. The Sub-Advisor is paid by the Advisor and not the Fund. For the year ended August 31, 2022, the Fund paid $2,871,149 in advisory fees. HFSA paid $0 in advisory fees, for the year ended August 31, 2022.

The Board has adopted a Distribution Plan and Agreement (the “Plan”) pursuant to Rule 12b-1 under the 1940 Act. Under the Plan, an account maintenance fee of 0.25% as compensation for sales, promotional activities and services, and a distribution fee at the rate of 0.75% on an annualized basis of the average net assets are attributable to Service Class Shares of the Fund. The fees are paid to Ceros Financial Services Inc. (the “Distributor” or “Ceros”) an affiliate of the Advisor to provide compensation for ongoing shareholder servicing and distribution-related activities or services and-or maintenance of Service Class accounts, not otherwise required to be provided by the Advisor. The Plan is a compensation plan, which means that compensation is provided regardless of 12b-1 expenses incurred. For the year ended August 31, 2022, the Fund incurred $979,118 in fees. During the year ended August 31, 2022, Ceros, a registered broker/dealer, executed trades on behalf of the Fund and received no trade commissions.

The Board has adopted a Shareholder Servicing Plan (the “Servicing Plan”) with respect to the Investor Class of the Fund. The Servicing Plan provides that a monthly service fee is calculated by the Fund at an annual rate of up to 0.25% of its average daily net assets of the Investor Class and is paid to Ceros to provide compensation for ongoing shareholder servicing and distribution-related activities or service and/or maintenance accounts, not otherwise required to be provided by the Advisor. Ceros is an affiliate of the Advisor. For the year ended August 31, 2022, the Fund incurred $113,490 in fees.

Pursuant to a liquidity program administrator agreement with the Fund, the Advisor, provides a liquidity program administrator who, directs the operations of the Fund’s liquidity risk management program. As compensation for its services and the related expenses borne by the Advisor, the Fund pays the Advisor out of pocket expenses and an annual fee of $9,000. The liquidity program administrator agreement became effective June 1, 2021. Pursuant to the liquidity program administrator agreement, the Advisor earned $9,000 in fees for the year ended August 31, 2022.

19

Hundredfold Select Alternative Fund

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (Continued)

August 31, 2022

Spectrum Financial Inc., an affiliate of Hundredfold, may provide services to the Fund and receive an annualized fee of 0.25% based on the average daily net assets of the Fund attributable to clients of Spectrum Financial, Inc. who are Service Class shareholders of the Fund. For the year ended August 31, 2022, there were no fees paid under this agreement.

Ultimus Fund Solutions, LLC (“UFS”), UFS, provides administration, fund accounting, and transfer agent services to the Trust. Pursuant to the servicing agreement with UFS, the Fund pays UFS customary fees for providing administration, fund accounting and transfer agency services to the Fund. Under the terms of the Funds’ agreement with UFS, UFS pays for certain operating expenses of the Funds. Certain officers of the Trust are also officers of UFS, and are not paid any fees directly by the Funds for serving in such capacities.

In addition, certain affiliates of UFS provide services to each Fund as follows:

Blu Giant, LLC (“Blu Giant”), an affiliate of UFS and NLCS, provides EDGAR conversion and filing services as well as print management services for the Fund on an ad-hoc basis. UFS is responsible for these fees.

8. RECENT REGULATORY UPDATES

In October 2020, the Securities and Exchange Commission (the “SEC”) adopted new regulations governing the use of derivatives by registered investment companies (“Rule 18f-4”). Rule 18f-4 imposes limits on the amount of derivatives a Fund can enter into, eliminates the asset segregation framework currently used by funds to comply with Section 18 of the 1940 Act, treats derivatives as senior securities and requires funds whose use of derivatives is more than a limited specified exposure amount to establish and maintain a comprehensive derivatives risk management program and appoint a derivatives risk manager.

9. UNDERLYING INVESTMENT IN OTHER INVESTMENT COMPANIES

The Fund currently invests a portion of its assets in Fidelity Government Portfolio, Class I shares (“Fidelity”). The Fund may redeem its investment at any time if the Advisor or Sub-Advisor determines that it is in the best interest of the Fund and its shareholders to do so. The performance of the Fund will be directly affected by the performance of Fidelity. The financial statements of Fidelity, including the portfolio of investments, can be found at the Securities and Exchange Commission’s website www.sec.gov and should be read in conjunction with the Fund’s financial statements. As of August 31, 2022, the percentage of the Fund’s net assets invested in Fidelity was 29.2%.

10. SUBSEQUENT EVENTS

Subsequent events after the date of the Statement of Assets and Liabilities have been evaluated through the date the financial statements were issued. Management has determined that no events or transactions occurred requiring adjustment or disclosure in the financial statements.

20

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

To the Shareholders of Hundredfold Select Alternative Fund and 

Board of Trustees of Advisors Preferred Trust

Opinion on the Financial Statements

We have audited the accompanying consolidated statement of assets and liabilities, including the consolidated schedule of investments, of Hundredfold Select Alternative Fund (the “Fund”), a series of Advisors Preferred Trust, as of August 31, 2022, the related consolidated statement of operations for the year then ended, the consolidated statements of changes in net assets for each of the two years in the period then ended, the related notes, and the consolidated financial highlights for each of the five years in the period then ended (collectively referred to as the “financial statements”). In our opinion, the financial statements present fairly, in all material respects, the financial position of the Fund as of August 31, 2022, the results of its operations for the year then ended, the changes in net assets for each of the two years in the period then ended, and the financial highlights for each of the five years in the period then ended, in conformity with accounting principles generally accepted in the United States of America.

Basis for Opinion

These financial statements are the responsibility of the Fund’s management. Our responsibility is to express an opinion on the Fund’s financial statements based on our audits. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (“PCAOB”) and are required to be independent with respect to the Fund in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.

We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement whether due to error or fraud.

Our audits included performing procedures to assess the risks of material misstatement of the financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements. Our procedures included confirmation of securities owned as of August 31, 2022, by correspondence with the custodian and brokers. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial statements. We believe that our audits provide a reasonable basis for our opinion.

We have served as the auditor of one or more investment companies advised by Advisors Preferred, LLC since 2012.

COHEN & COMPANY, LTD. 

Chicago, Illinois

October 28, 2022

COHEN & COMPANY, LTD. 

800.229.1099 | 866.818.4538 fax | cohencpa.com

Registered with the Public Company Accounting Oversight Board

21

Hundredfold Select Alternative Fund

Hundredfold Select Alternative Fund

EXPENSE EXAMPLE (Unaudited)

August 31, 2022

As a shareholder of a mutual fund, you incur two types of costs: (1) transaction costs, including reinvested dividends, or other distributions; redemption fees; and exchange fees; and (2) ongoing costs, including management fees; distribution and/or service fees; and other fund expenses. This example is intended to help you understand your ongoing costs (in dollars) of investing in a fund and to compare costs with the ongoing costs of investing in other mutual funds.

The example is based on an investment of $1,000 invested at the beginning of the period and held the entire period March 1, 2022 – August 31, 2022.

Actual Expenses

The first line of the table below provides information about actual account values and actual expenses. You may use the information below; together with the amount you invested, to estimate the expenses that you paid over the period. Simply divide your account value by $1,000 (for example, an $8,600 account value divided by $1,000 = 8.6), then multiply the result by the number provided under the heading “Expenses Paid During Period” to estimate the expenses you paid on your account during this period.

Hypothetical Example for Comparison Purposes

The second line of the table below provides information about hypothetical account values and hypothetical expenses based on the Fund’s actual expense ratio and an assumed rate of return of 5% per year before expenses, which is not the Fund’s actual return. The hypothetical account values and expenses may not be used to estimate the actual ending account balances or expenses you paid for the period. You may use this information to compare this 5% hypothetical example with the 5% hypothetical examples that appear in the shareholder reports of other funds.

Please note that the expenses shown in the table are meant to highlight your ongoing costs only and do not reflect any transactional costs, such as sales charges (loads), or redemption fees. Therefore, the table is useful in comparing ongoing costs only, and will not help you determine the relative total costs of owning different funds. In addition, if these transactional costs were included, your costs would have been higher.

	Annualized			Beginning		Ending		Expenses
	Expense			Account Value		Account Value		Paid During
	Ratio			March 1, 2022		August 31, 2022		Period (1)
Service Class
Based on actual fund return		2.16	%	$	1,000.00	$	923.70	$	10.46
Based on hypothetical 5% return		2.16	%		1,000.00		1,014.33		10.96
Investor Class
Based on actual fund return		1.22	%		1,000.00		928.10		5.92
Based on hypothetical 5% return		1.22	%		1,000.00		1,019.06		6.20

(1) Expenses are equal to the Fund’s annualized expense ratio, multiplied by the average account value over the period, multiplied by the number of days in the period (184), then divided by the number of days in the fiscal year (365).

22

Hundredfold Select Alternative Fund

ADDITIONAL INFORMATION (Unaudited)

August 31, 2022

LIQUIDITY RISK MANAGEMENT PROGRAM

The Fund has adopted and implemented a written liquidity risk management program as required by Rule 22e-4 (the “Liquidity Rule”) under the Investment Company Act. The program is reasonably designed to assess and manage the Fund’s liquidity risk, taking into consideration, among other factors, the Fund’s investment strategies and the liquidity of portfolio investments during normal and reasonably foreseeable stressed conditions; short and long-term cash flow projections; and cash holdings and access to other funding sources.

During the year ended August 31, 2022, the Trust’s Liquidity Program Administrator (“LPA”) and the Board reviewed the Fund’s investments and they determined that, generally, the Fund held adequate levels of cash and highly liquid investments to meet shareholder redemption activities in accordance with applicable requirements. Accordingly, the Board and the LPA concluded that (i) the Fund’s liquidity risk management program is reasonably designed to prevent violations of the Liquidity Rule and (ii) the Fund’s liquidity risk management program has been effectively implemented.

23

Hundredfold Select Alternative Fund

SUPPLEMENTAL INFORMATION (Unaudited)

August 31, 2022

Independent Trustees

The following table provides information regarding each Trustee who is not an “interested person” of the Trust, as defined in the 1940 Act. 

Name, Address 1 and Year of Birth	Position(s) Held with the Trust	Term of Office/Length of Time Served	Principal Occupation(s) During Past 5 Years	Number of Portfolios in Fund Complex Overseen by Trustee 2	Other Directorships Held by Trustee
Charles R. Ranson Born: 1947	Trustee	Indefinite, since November 2012	Principal, Ranson & Associates (business consultancy) (since 2003);	21	Northern Lights Fund Trust IV (30 series) (since July 2015)
Felix Rivera Born: 1963	Trustee	Indefinite, since November 2012	Managing Partner, Independent Channel Advisors, LLC (Consultancy Practice), (since January 2011)	21	Centerstone Investors Trust (2 series) (March 2016-2021); BlueArc Multi- Strategy Fund (Nov. 2014 to Jan. 2018
David Feldman Born: 1963	Trustee	Indefinite, Since September 2017	Independent Consultant (since January 2015); Head of Intermediary Sales, Baron Capital Inc., (February 2010 to December 2014)	21	None

¹ Unless otherwise specified, the mailing address of each Trustee is c/o Advisors Preferred Trust, 1445 Research Blvd., Suite 530, Rockville, MD 20850.

² The “Fund Complex” consists of the series of the Trust.

24

Hundredfold Select Alternative Fund

SUPPLEMENTAL INFORMATION (Unaudited)(Continued)

August 31, 2022

Interested Trustees and Officers

The following table provides information regarding each Trustee who is an “interested person” of the Trust, as defined in the 1940 Act, and each officer of the Trust. 

Name, Address 1 And Year of Birth	Position(s) Held with the Fund	Term of Office/ Length of Time Served	Principal Occupation(s) During Past Five Years	Number of Portfolios in Fund Complex Overseen by Trustee 2	Other Directorships Held by Trustee During Last Five Years
Catherine Ayers- Rigsby(3) Born: 1948	Trustee, Chairman, President	Indefinite; since November 2012	CEO, Advisors Preferred, LLC (since June 2011); President, Ceros Financial Services, Inc., (broker/dealer) (since August 2009); President AtCap Partners, LLC (investment adviser) (since July 2011)	21	None
Brian S. Humphrey(4) Born: 1972	Trustee	Indefinite; since November 2012	Managing Director, Ceros Financial Services, Inc., (since January 2011)	21	None
Christine Casares Born: 1975	Treasurer	Indefinite; since May 2019	Vice President, Tax Administration, Ultimus Fund Solutions, LLC (since February 2016); Assistant Vice President, Tax Administration (February 2012 January 2016)	N/A	N/A
Angela Holland Born 1970	Chief Compliance Officer	Indefinite; since July 1, 2020	Chief Compliance Officer, Advisors Preferred, LLC (since March 2022); Chief Compliance Officer, Ceros Financial Services, Inc. (since January 2016); Chief Compliance Officer, AtCap Partners, LLC (investment Advisers) (Since March 2022); Sales Supervisor/AML Compliance Officer, Ceros Financial Services, Inc. (April 2012 – January 2016); Compliance Manager, Advisors Preferred, LLC (April 2012 March 2022)); Compliance Manager, AtCap (April 2012-March 2022)	N/A	N/A
Jeff Meacham Born: 1976	Assistant Treasurer	Indefinite; Since November 2021	Senior Trader, Ceros Financial Services, Inc.	N/A	N/A
Daniel Gibson Born: 1984	Assistant Treasurer Secretary	Indefinite; Since November 2021 Indefinite; Since October 2022	Trader/Dealers & Commissions Specialist, Ceros Financial Services, Inc.	N/A	N/A

¹ Unless otherwise specified, the address of each Trustee and officer is Advisors Preferred Trust, 1445 Research Blvd., Suite 530, Rockville, MD 20850.

² The “Fund Complex” consists of the series of the Trust.

³ Ms. Ayers-Rigsby is an interested person Trustee because she is an officer of the Trust, an officer of the Trust’s investment adviser, and an officer of the Trust’s principal underwriter.

⁴ Mr. Humphrey is an interested person Trustee because he is an officer of the Trust’s principal underwriter.

The Funds’ Statement of Additional Information includes additional information about the Trustees and is available free of charge by calling toll- free 1-855-582-8006.

25

Hundredfold Select Alternative Fund

SUPPLEMENTAL INFORMATION (Unaudited)

August 31, 2022

Approval of Renewal of the Investment Advisory Agreement and Sub-Advisory Agreement for Hundredfold Select Alternative Fund

At a video conference meeting held on May 11, 2022 (the “Meeting”), held in accordance with relief granted by the U.S. Securities and Exchange Commission (the “SEC”) to ease certain governance obligations required under the Investment Company Act of 1940, as amended (the “1940 Act”) in light of travel concerns related to the COVID-19 pandemic (the “SEC Relief Order”) the Board of Trustees (the “Board”) of Advisors Preferred Trust (the “Trust”), including a majority of Trustees who are not “interested persons” (the “Independent Trustees”), as such term is defined under Section 2(a)(19) of the 1940 Act, considered the renewal of the investment advisory agreement (the “Advisory Agreement’) between Advisors Preferred, LLC (the “Adviser”) and the Trust, on behalf of Hundredfold Select Alternative Fund (the “Fund” or “Hundredfold Select”) and for Hundredfold Select Alternative Investment Fund Ltd. (the “Subsidiary”; and the renewal of the sub-advisory agreement (the “Sub-Advisory Agreement”) between the Adviser and Hundredfold Advisors, LLC (“Hundredfold” or the “Sub-Adviser”) and for the Subsidiary (“all together the Advisory Agreements).

In connection with the Board’s consideration and approval of the renewal of the Advisory Agreements the Adviser and Sub-Adviser provided the Board in advance of the Meeting with written materials, which included information regarding: (a) a description of the investment management personnel of the Adviser and Sub-Adviser; (b) the Adviser’s and Sub-Adviser’s operations and financial condition; (c) the Adviser’s brokerage practices (including any soft dollar arrangements); (d) the level of the advisory fees proposed to be charged compared with the fees charged to comparable mutual funds or accounts; (e) anticipated direct level of profitability to the Adviser and Sub-Adviser and from related operations; (f) the Adviser’s and Sub-Adviser’s compliance policies and procedures; and (g) information regarding the performance of the Hundredfold Select as compared to benchmarks and Morningstar category. The Board’s review of the materials and deliberations are presented contemporaneously given the overlapping considerations, paralleled issues and conclusions drawn by the Board. The Board members relied upon the advice of independent legal counsel and their own business judgment in determining the material factors to be considered in evaluating the Advisory Agreements

Moreover, each Trustee may have afforded different weight to the various factors in reaching conclusions with respect to the Agreements. The Board reviewed the quality of work and abilities of the Adviser and its relationship with Hundredfold and the performance of the Fund. In light of the Fund’s performance and the compliance/review relationship with the Hundredfold, the Board concluded that the Adviser had sufficient quality and depth of personnel, resources, investment methods and compliance policies and procedures essential to performing its duties to the Fund. The Board conducted some of their deliberations on a joint basis for the Adviser and Hundredfold given the close working relationship of the Adviser and Sub-Adviser.

Nature, Extent and Quality of Services. With respect to the nature, extent and quality of services provided, the Trustees reviewed the Adviser’s Form ADV, and the Sub-Adviser’s Form ADV, a description of the manner in which investment decisions will be made for the Fund by the Sub-Adviser, a description of the services provided by the Adviser and those services provided by the Sub-Adviser and those executed by the Adviser. The Board reviewed the experience of professional personnel from both the Adviser and Sub-Adviser performing services for the Fund, including the team of individuals that primarily monitor and execute the investment and administration process, and the portfolio managers. Further reviewed by the Board was a certification from each of the Adviser and Sub-Adviser certifying that each has adopted a Code of

26

Hundredfold Select Alternative Fund

SUPPLEMENTAL INFORMATION (Unaudited)(Continued)

August 31, 2022

Ethics containing provisions reasonably necessary to prevent Access Persons, as that term is defined in Rule 17j-1 under the 1940 Act, from engaging in conduct prohibited by Rule 17j-1(b) and that each of the Adviser and Sub-Adviser have adopted procedures reasonably necessary to prevent Access Persons from violating such Code of Ethics.

The Board also reviewed the balance sheet of the Adviser as of December 31, 2021, and found the financial resources greatly improved over previous years. Management noted the Adviser has access to additional capital if the need should arise. There was discussion with respect to legal fees and how they were reflected on the income statement and balance sheet, and the Board noted the net income for the Adviser was improved from prior years.

With respect to Hundredfold Advisors, LLC(“Hundredfold”), the Board reviewed an income statement and balance sheet as of December 31, 2021, reflecting assets available to the sub-adviser to continue sub-advising Hundredfold Select. The Board concluded that the Adviser and each sub-adviser have adequate financial resources to continue to service the Fund

The Board also discussed the Adviser’s compliance program with the CCO of the Trust. The Board noted that the Adviser continues to have in place procedures which are currently working to prevent violations of applicable securities laws. The CCO confirmed that she has the support and resources to ensure the compliance procedures of the Trust are updated in accordance with current SEC rules. The Board concluded that the Adviser has qualified professionals, resources, and compliance policies essential to performing its duties under the Advisory Agreements.

Regarding the compliance programs of the sub-adviser, the CCO noted that she works with the CCO of the Sub-Adviser. The Board confirmed with the CCO that she had reviewed the policies. The Board determined that the sub-adviser has a compliance program in place that is reasonably designed to prevents violation of the applicable federal securities laws. The Board noted they are familiar with the portfolio managers of the sub-adviser and their qualifications in managing the Hundredfold Select Fund.

Performance. The Board considered that the Adviser delegates day-to-day investment decisions to the Sub-Adviser and, therefore, would not directly control the performance of the Fund. The Board considered the Adviser’s other responsibilities under the Advisory Agreement, including with respect to trade oversight, reviewing daily positions and balance reports for the Fund, obtaining derivative agreements and reporting to the Board, and concluded that the Adviser appears to be adequately monitoring the Sub-Adviser’s adherence to the Fund’s investment objectives and appears to be carrying out its functions appropriately.

With respect to the performance results from the Sub-Adviser’s daily management and investment strategies, the Board considered the updated performance of the Fund compared to its primary benchmark and Morningstar category for various periods provided by the Adviser. The Trustees also reviewed the Sub-Adviser’s strategy and the Fund’s performance for various periods with explanations for over/under performance.

The Board reviewed the Fund’s performance for the one-, three-, five- and ten-year periods ended March 31, 2022. They noted the Fund outperformed the Bloomberg U.S. Aggregate Bond Index for all periods. The Board also compared the Fund’s performance to the Morningstar Tactical Allocation category and saw that it outperformed for each period. The Board noted the Fund had lagged S&P 500 Total Return Index for all periods. The Board observed that the S&P 500 index is shown primarily for a market performance reference point but does not serve as direct comparison because its 100% equity composition is outside the moderate return investment

27

Hundredfold Select Alternative Fund

SUPPLEMENTAL INFORMATION (Unaudited)(Continued)

August 31, 2022

mandate and alternative strategy of the Fund. The Board noted that based on the experience of the portfolio manager and with oversight by the Adviser, Hundredfold Advisers is expected to continue to provide satisfactory performance for the Fund and its shareholders.

Fees and Expenses. As to the costs of the services to be provided to the Fund by the Adviser and Sub-Adviser, respectively, the Board reviewed and discussed the advisory fee and total operating expenses of the Fund compared to its peer group and Morningstar category as presented in the Meeting Materials.

The Board noted that advisory fee of 1.00% for Hundredfold Select was well within range and below the maximum management fee for the Morningstar Tactical Allocation category. The Board discussed the net expenses of 1.77% for Investor Class shares and 2.66% for Service Class shares and found both within range of the Morningstar Tactical Allocation respective class category. The Board concluded that the advisory fee and net expenses for Hundredfold Select are reasonable.

For the Fund, the Board reviewed and considered the split of the Advisory fee between the Adviser and the sub-adviser (the sub-adviser being paid by the Adviser, not the Fund), and determined it was acceptable and reasonable for the services to be provided to the Fund.

Profitability of Adviser. The Board reviewed the levels of profits to the Adviser for the most recent fiscal year from the Fund with respect to advisory fees and from the total relationship with the Fund. They considered whether profits from the Fund were reasonable in light of services provided, including the assets levels and payments to the Sub-Adviser, and any breakpoints in fee structures for the Fund. The Board, in consultation with counsel noted that current court rulings with respect to profitability suggest up to or even over a 50% profit margin for any adviser or sub-adviser could be acceptable and not considered excessive.

With respect to Hundredfold Select, the Board noted the adviser made a modest 13% profit from advisory fees, and that the profit decreased to 9% when taking into account expenses which the Advisor incurred with respect to the total relationship with the Fund. The Board reviewed the split between the Adviser and the Sub-Adviser and found it reasonable. The Board concluded that excess profits to the Adviser from its relationship with Hundredfold Select are not of concern at this time and agreed to monitor the profits as the Fund increases in assets.

Profitability Sub-Adviser: The Board reviewed the levels of profits to the Sub-Adviser for the most recent fiscal year from the Fund with respect to sub-advisory fees and from the total relationship with the Fund. With regards to the Fund, the Board noted that the Sub-Adviser usually charges higher fees for separately managed accounts with similar investment strategies, if any. The Board, in consultation with counsel noted that current court rulings with respect to profitability suggest up to or even over a 50% profit margin for any adviser or sub-adviser could be acceptable and not considered excessive.

The Board reviewed the profitability analysis submitted by Hundredfold Advisors and noted that it receives 0.65% on assets up to and including $150 million and 0.80% for higher asset levels. The Trustees noted that as almost all Hundredfold Adviser services are provided at no cost, the Sub-Adviser profits were high, prior to giving consideration to a percentage of these profits going to charities. The Board also considered that the profitability of Hundredfold Advisors would be reasonable if direct and overhead expenses were imputed to cover costs of portfolio management and support services, prior to giving consideration to a percentage of these profits going to charities. The Board did note, however, that Spectrum Financial did receive a shareholder servicing fee from the Fund and will receive such a fee for providing services to its clients that are invested in the Fund. After considering the non-conventional ways of measuring Sub-Adviser

28

Hundredfold Select Alternative Fund

SUPPLEMENTAL INFORMATION (Unaudited)(Continued)

August 31, 2022

profits, and that services had been donated to the Fund to help further its charitable purpose. The Board found the level of profit from the Sub-Adviser’s relationship with the Fund was not excessive, and after charitable donations, Hundredfold Advisors does not profit from its relationship with the Fund. The Board concluded that excess profits to the Sub-Adviser from its relationship with the Fund is not a current concern.

Economies of Scale. As to the extent to which the Fund will realize economies of scale, the Adviser reported an estimate of $500 million to be the minimum asset level required to reach such economies of scale and that the Fund may not achieve economies of scale as it may face capacity issues. The Board discussed the Adviser’s expectations for the growth of the Fund and concluded that any material economies of scale were not a concern at present assets levels. The Trustees agreed to revisit economies of scale as assets of the Fund continue to grow. The Board also confirmed that economies of scale is not a consideration for approval of any sub-advisory agreement.

Conclusion. The Board was assisted by counsel throughout the Advisory Agreements review process. The Board members relied upon the advice of counsel, and their own business judgment in determining the material factors to be considered in evaluating each of the Advisory Agreements. In considering the approval, the Board noted that each Trustee may have afforded different weight to the various factors in reaching his conclusions with respect to the Advisory Agreements.

29

PRIVACY NOTICE 

Rev. May 2014

FACTS	WHAT DOES ADVISORS PREFERRED TRUST DO WITH YOUR PERSONAL INFORMATION?
Why?	Financial companies choose how they share your personal information. Federal law gives consumers the right to limit some but not all sharing. Federal law also requires us to tell you how we collect, share, and protect your personal information. Please read this notice carefully to understand what we do.
What?	The types of personal information we collect and share depend on the product or service you have with us. This information can include:
	■	Social Security number	■	Purchase History
	■	Assets	■	Account Balances
	■	Retirement Assets	■	Account Transactions
	■	Transaction History	■	Wire Transfer Instructions
	■	Checking Account Information
	When you are no longer our customer, we continue to share your information as described in this notice.
How?	All financial companies need to share customers’ personal information to run their everyday business. In the section below, we list the reasons financial companies can share their customers’ personal information; the reasons Advisors Preferred Trust chooses to share; and whether you can limit this sharing.

Reasons we can share your personal information	Does Advisors Preferred Trust share?	Can you limit this sharing?
For our everyday business purposes – such as to process your transactions, maintain your account(s), respond to court orders and legal investigations, or report to credit bureaus	Yes	No
For our marketing purposes – to offer our products and services to you	No	We don’t share
For joint marketing with other financial companies	No	We don’t share
For our affiliates’ everyday business purposes – information about your transactions and experiences	No	We don’t share
For our affiliates’ everyday business purposes – information about your creditworthiness	No	We don’t share
For nonaffiliates to market to you	No	We don’t share

Questions? Call 1-866-862-9686

30

Who we are
Who is providing this notice?	Advisors Preferred Trust
What we do
How does Advisors Preferred Trust protect my personal information?	To protect your personal information from unauthorized access and use, we use security measures that comply with federal law. These measures include computer safeguards and secured files and buildings. Our service providers are held accountable for adhering to strict policies and procedures to prevent any misuse of your nonpublic personal information.
How does Advisors Preferred Trust collect my personal information?	We collect your personal information, for example, when you ■    Open an account ■    Provide account information ■    Give us your contact information ■    Make deposits or withdrawals from your account ■    Make a wire transfer ■    Tell us where to send the money ■    Tells us who receives the money ■    Show your government-issued ID ■    Show your driver’s license We also collect your personal information from other companies.
Why can’t I limit all sharing?	Federal law gives you the right to limit only   ■    Sharing for affiliates’ everyday business purposes – information about your creditworthiness ■    Affiliates from using your information to market to you ■    Sharing for nonaffiliates to market to you State laws and individual companies may give you additional rights to limit sharing.
Definitions
Affiliates	Companies related by common ownership or control. They can be financial and nonfinancial companies. ■    Advisors Preferred Trust does not share with our affiliates.
Nonaffiliates	Companies not related by common ownership or control. They can be financial and nonfinancial companies.   ■    Advisors Preferred Trust does not share with nonaffiliates so they can market to you.
Joint marketing	A formal agreement between nonaffiliated financial companies that together market financial products or services to you. ■    Advisors Preferred Trust doesn’t jointly market.

31

PROXY VOTING POLICY

Information regarding how the Fund votes proxies relating to portfolio securities for the twelve month period ended June 30th as well as a description of the policies and procedures that the Fund used to determine how to vote proxies is available without charge, upon request, by calling 1-866-866-4848 or by referring to the Securities and Exchange Commission’s (“SEC”) website at http://www.sec.gov.

PORTFOLIO HOLDINGS

The Fund files its complete schedule of portfolio holdings with the SEC for the first and third quarters of each fiscal year as an exhibit to its reports on Form N-PORT, within sixty days after the end of the period Form N-PORT reports are available on the SEC’s website at http://www.sec.gov. The information on Form N-PORT is available without charge, upon request, by calling 1-855-582-8006.

INVESTMENT ADVISOR 

Advisors Preferred, LLC 

1445 Research Boulevard, #530 

Rockville, MD 20850

SUB-ADVISOR 

Hundredfold Advisors, LLC 

272 Bendix Road, Suite 600 

Virginia Beach, VA 23452

ADMINISTRATOR 

Ultimus Fund Solutions, LLC 

225 Pictoria Drive, Suite 450 

Cincinnati, OH 45246

HSAF-AR22

(b)        Not applicable

Item 2. Code of Ethics.

(a)       As of the end of the period covered by this report, the registrant has adopted a code of ethics that applies to the registrant's principal executive officer, principal financial officer, principal accounting officer or controller, or persons performing similar functions, regardless of whether these individuals are employed by the registrant or a third party.

(b)        For purposes of this item, “code of ethics” means written standards that are reasonably designed to deter wrongdoing and to promote:

(1) Honest and ethical conduct, including the ethical handling of actual or apparent conflicts of interest between personal and professional relationships;

(2) Full, fair, accurate, timely, and understandable disclosure in reports and documents that a registrant files with, or submits to, the Commission and in other public communications made by the registrant;

(3)        Compliance with applicable governmental laws, rules, and regulations;

(4) The prompt internal reporting of violations of the code to an appropriate person or persons identified in the code; and

(5)        Accountability for adherence to the code.

(c)        Amendments: During the period covered by the report, there have not been any amendments to the provisions of the code of ethics.

(d)        Waivers: During the period covered by the report, the registrant has not granted any express or implicit waivers from the provisions of the code of ethics.

(e) The Code of Ethics is not posted on Registrant’ website.

(f) A copy of the Code of Ethics is attached as an exhibit.

Item 3. Audit Committee Financial Expert.

(a)       The Registrant’s board of trustees has determined that Felix Rivera is the audit committee financial expert, as defined in Item 3 of Form N-CSR. Mr. Rivera is independent for purposes of this Item 3.

Item 4. Principal Accountant Fees and Services.

(a) Audit Fees

2022 - $16,500

2021 - $15,000

(b) Audit-Related Fees

2021 – None

2021 - None

(c) Tax Fees

2022 - $3,250

2021 - $3,250

Preparation of Federal & State income tax returns, assistance with calculation of required income, capital gain and excise distributions and preparation of Federal excise tax returns.

(d) All Other Fees

2022 – None

2021 – None

(e) (1) Audit Committee’s Pre-Approval Policies

The registrant’s Audit Committee is required to pre-approve all audit services and, when appropriate, any non-audit services (including audit-related, tax and all other services) to the registrant. The registrant’s Audit Committee also is required to pre-approve, when appropriate, any non-audit services (including audit-related, tax and all other services) to its adviser, or any entity controlling, controlled by or under common control with the adviser that provides ongoing services to the registrant, to the extent that the services may be determined to have an impact on the operations or financial reporting of the registrant. Services are reviewed on an engagement by engagement basis by the Audit Committee.

(2) Percentages of Services Approved by the Audit Committee

2022 2021

Audit-Related Fees:       100% 100%

Tax Fees:                      100% 100%

All Other Fees:              100% 100%

(f) During the audit of registrant's financial statements for the most recent fiscal year, less than 50 percent of the hours expended on the principal accountant's engagement were attributed to work performed by persons other than the principal accountant's full-time, permanent employees.

(g) The aggregate non-audit fees billed by the registrant's accountant for services rendered to the registrant, and rendered to the registrant's investment adviser (not including any sub-adviser whose role is primarily portfolio management and is subcontracted with or overseen by another investment adviser), and any entity controlling, controlled by, or under common control with the adviser that provides ongoing services to the registrant:

2022 - $3,250

2021 - $3,250

(h)        The registrant's audit committee has considered whether the provision of non-audit services to the registrant's investment adviser (not including any sub-adviser whose role is primarily portfolio management and is subcontracted with or overseen by another investment adviser), and any entity controlling, controlled by, or under common control with the investment adviser that provides ongoing services to the registrant, that were not pre-approved pursuant to paragraph (c)(7)(ii) of Rule 2-01 of Regulation S-X, is compatible with maintaining the principal accountant's independence.

(i)        Not applicable

(j)        Not applicable

Item 5. Audit Committee of Listed Companies. Not applicable to open-end investment companies.

Item 6. Schedule of Investments. Schedule of investments in securities of unaffiliated issuers is included under Item 1.

Item 7. Disclosure of Proxy Voting Policies and Procedures for Closed-End Funds. Not applicable to open-end investment companies.

Item 8. Portfolio Managers of Closed-End Management Investment Companies. Not applicable to open-end investment companies.

Item 9. Purchases of Equity Securities by Closed-End Funds. Not applicable to open-end investment companies.

Item 10. Submission of Matters to a Vote of Security Holders. Vote of security holders is included under item 1.

Item 11. Controls and Procedures.

(a)       Based on an evaluation of the Registrant’s disclosure controls and procedures as of a date within 90 days of filing date of this Form N-CSR, the principal executive officer and principal financial officer of the Registrant have concluded that the disclosure controls and procedures of the Registrant are reasonably designed to ensure that the information required in filings on Form N-CSR is recorded, processed, summarized, and reported by the filing date, including that information required to be disclosed is accumulated and communicated to the Registrant’s management, including the Registrant’s principal executive officer and principal financial officer, as appropriate to allow timely decisions regarding required disclosure.

(b) There were no significant changes in the Registrant’s internal control over financial reporting that occurred during the period covered by this report that have materially affected, or are reasonably likely to materially affect, the Registrant’s internal control over financial reporting.

Item 12. Disclosure of Securities Lending Activities for Closed-End Management Investment Companies. Not applicable to open-end investment companies.

Item 13. Exhibits.

(a)(1) Code of Ethics filed herewith.

(a)(2) Certifications required by Section 302 of the Sarbanes-Oxley Act of 2002 (and Item 11(a)(2) of Form N-CSR) are filed herewith.

(a)(3) Not applicable for open-end investment companies.

(a)(4) Not applicable.

(b)       Certifications required by Section 906 of the Sarbanes-Oxley Act of 2002 (and Item 11(b) of Form N-CSR) are filed herewith.

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment Company Act of 1940, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

(Registrant) Advisors Preferred Trust

By (Signature and Title)

/s/ Catherine Ayers-Rigsby

Catherine Ayer-Rigsby, President/Principal Executive Officer

Date 11/4/22

Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment Company Act of 1940, this report has been signed below by the following persons on behalf of the registrant and in the capacities and on the dates indicated.

By (Signature and Title)

/s/ Catherine Ayers-Rigsby

Catherine Ayer-Rigsby, President/Principal Executive Officer

Date 11/4/22

By (Signature and Title)

/s/ Christine Casares

Christine Casares, Treasurer/Principal Financial Officer

Date 11/4/22