UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM N-CSR
CERTIFIED SHAREHOLDER REPORT OF REGISTERED
MANAGEMENT INVESTMENT COMPANIES
Investment Company Act file number 811-09094
Leuthold Funds, Inc.
(Exact name of registrant as specified in charter)
(Exact name of registrant as specified in charter)
150 S. 5th Street, Suite 1700, Minneapolis, MN 55402
(Address of principal executive offices) (Zip code)
(Address of principal executive offices) (Zip code)
John Mueller
Leuthold Weeden Capital Management
150 S. 5th Street, Suite 1700, Minneapolis, MN 55402
(Name and address of agent for service)
(Name and address of agent for service)
612-332-9141
Registrant's telephone number, including area code
Date of fiscal year end: September 30, 2018
Date of reporting period: September 30, 2018
Item 1. Reports to Stockholders.
Annual Report
September 30, 2018
September 30, 2018
The Leuthold Funds
Leuthold Core Investment Fund
Retail Class Shares LCORX
Institutional Class Shares LCRIX
Retail Class Shares LCORX
Institutional Class Shares LCRIX
Leuthold Global Fund
Retail Class Shares GLBLX
Institutional Class Shares GLBIX
Retail Class Shares GLBLX
Institutional Class Shares GLBIX
Leuthold Select Industries Fund LSLTX
Leuthold Global Industries Fund
Retail Class Shares LGINX
Institutional Class Shares LGIIX
Retail Class Shares LGINX
Institutional Class Shares LGIIX
Grizzly Short Fund GRZZX
The Leuthold Funds
Table of Contents
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| Schedules of Investments and Securities Sold Short | |
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The Leuthold Funds
A year ago, the bull market was characterized as the “most hated” in history. This was evidenced by an obsession with “safety-first” equity investments and the absence of “cocktail-party buzz” ever since the bull market began over nine years earlier. However, we were seeing signs last year that the public-participation phase was underway, probably having begun (with the clarity of hindsight) way back on election night 2016. There was little evidence that tighter policy had yet adversely affected either the economy or the stock market. Many economic measures were not just making “cycle highs,” but 17- and 18-year highs. From a technical point of view, there were “new highs all around,” across all capitalization tiers, including nearly all breadth measures, and throughout the bellwether indicators that would typically be the forerunners to signal impending weakness.
In late 2017, market strength pushed several key valuation measures up to new bull market extremes and, although we anticipated cracks to develop in 2018, cyclical and technical conditions suggested valuations had room to move higher. Our tactical asset allocation funds were therefore bullishly positioned with net equity exposure of 62%—near the maximum level of 70% allowed per strategy guidelines. The global equity-market rally did indeed accelerate, and most major indices made new all-time highs. The synchronized global economic expansion continued to broaden out, and anemic inflation capped the rise in global interest rates. A crucial tax reform bill was passed in the U.S., further fueling optimism and animal spirits.
Set up for perfection, 2018 started off with markets at full throttle and stocks climbed even higher in January. The headlines didn’t deliver, however, and volatility returned to the equity market in a big way. An escalated deterioration of several economic and monetary factors drove our stock market analysis down to a neutral reading, hence, on January 25th, Leuthold tactical asset allocation funds reduced net equities down to 58% from 67%, a day in advance of the major market indexes once again setting new highs on January 26th. But, trade wars, tech regulation concerns, and rising interest rates slapped the market back into reality; the S&P 500 and MSCI ACWI pulled back by -10% and -8%, respectively, between late January and early February.
In March, our quantitatively-driven assessment regarding the outlook for stocks moved down to negative territory for the first time in two years and our tactical asset allocation funds reduced net equity exposure further, closing the month at 42-43%. Through March, gains produced by Leuthold Funds’ domestically-oriented tactical asset allocation fund and U.S.-traded long-equity fund were striking against the backdrop of losses experienced by most major indexes and peer-fund groups. Aligning with the market downtrend, both of Leuthold Funds’ globally-leaning strategies bore losses.
Continued economic growth, domestically, was given a shot in the arm by corporate tax cuts, and U.S. stocks staged a rebound in the months to follow, while international developed markets turned in lackluster performance and emerging markets performed poorly. The threat of a trade war was the dominant market theme and a big surge in the U.S. dollar also drove return differences. While volatility was lower across most asset classes, the macro headwind of central-bank liquidity reduction remained. Mega-cap growth stocks prolonged their rally while cheap stocks lagged.
In August, the S&P 500 fully erased the loss experienced from its nine-day swoon of late January to early February and it proceeded to advance even further in September, making a fresh all-time high. September’s stock market highs, however, were accompanied by something that the index highs of January 26th were not afflicted by: signs of internal distribution. Earlier in 2018, the market could alternatively be characterized as “divergent,” “disjointed,” or maybe even “discombobulated,” yet
The Leuthold Funds - 2018 Annual Report 1
despite enormous performance disparities—between the U.S. and the rest of the world, growth stocks versus value stocks, and momentum relative to ‘everything else’—the stock market still could not be dubbed “distributive” due to persistent strength in mid caps, small caps, advance/decline lines, and equal-weighted versions of major indexes. Contrary to that general strength of earlier-year market action, in late September, mid caps and small caps did hit air pockets, and breadth figures at September’s scattered highs in the DJIA and S&P 500 were exceptionally poor.
September’s brand-new signs of internal weakness prompted us to trim our tactical asset allocation funds’ net equity exposure to 40% in early October. Are we jumping the gun? Chart 1 illustrates that the “tape” has not exactly collapsed. Only two of the eight bellwethers shown had issued “official” warnings (i.e., failing to make a bull market high in the month leading up to the most recent S&P 500 high). Nevertheless, the combination of a full-employment U.S. economy, continued (and accelerating) global monetary tightening, and extremely high U.S. valuations suggest there’s substantial risk in waiting for “too much” market confirmation. There have been other times when the “tape” neglected to provide much forewarning—such as 1987 (Chart 2). In the coming fiscal year, we anticipate added market volatility, more risk than reward, and those invested solely in passively-managed funds to become acquainted with the reality of downside—the depths of which Leuthold Funds’ actively-managed strategies intend to bypass.
2 The Leuthold Funds - 2018 Annual Report
ANNUAL PERFORMANCE REVIEW
Tactical Asset Allocation—Domestic & Global Funds
One year ago, the Leuthold Core Investment Fund and Leuthold Global Fund were positioned with relatively aggressive net equity exposure of 62%. Even though our market analysis was firmly positive, extremely high stock market valuations were an impetus to keep exposure below the Funds’ maximum stock-allocation guideline of 70%. Entering 2018, market momentum indicators began to deteriorate, which steered incremental reductions to stock market exposure; by the end of March, both tactical asset allocation funds’ net equities had been scaled back to 42%. The Leuthold Global Fund’s equity reductions were accomplished by adding to the equity hedge while the Leuthold Core Investment Fund, in addition to increasing the equity hedge, sold stocks related to its Emerging Market allocation. During the remainder of the fiscal year, both Funds remained defensively positioned in the range of 42-45%.
For the fiscal year, the Leuthold Core Investment Fund posted a +3.23% total return (retail share class). Its peer group, Morningstar Tactical Allocation, bested the Fund with a total return of +5.60%. When evaluating against the fully-invested S&P 500 benchmark (+17.91% total return), the Fund substantially underperformed.
The Leuthold Global Fund produced a -0.67% total return (retail share class) for the fiscal year. The Fund trailed its peer-fund category, the Morningstar World Allocation average (+3.46% total return) by over 400 basis points. Compared to the fully-invested MSCI All Country World Index (ACWI) +9.77% total return, the Fund underperformed by over a 10% spread.
Indeed, holding net equity exposure roughly 55% less than the fully-invested benchmarks for two-thirds of the year partially accounts for the Leuthold Core Investment and Leuthold Global Funds’ performance disparities versus the S&P 500 and MSCI ACWI. Lower equity exposure, however, was ancillary to lagging results. There were deeper undercurrents behind the breadth of the Funds’ wide underperformance gaps which revolved around an abnormal reversal of momentum and value factor dynamics. This was a two-fold blow, agitating both the long stock and the short-stock investments. The Leuthold Core Investment Fund and Leuthold Global Fund were likewise negatively impacted in varying amounts by their foreign stock market coverage, which did not share the same degree of upside as major U.S. stock market indexes.
Long Equity Exposure
Over the last twelve months, the average monthly long-stock exposure in the Leuthold Core Investment Fund and Leuthold Global Fund was 63% and 62%, respectively. Of the portfolios’ sub-asset classes, this was the best performing component for the fiscal year. Reflecting the domination of U.S. stock performance versus foreign stock performance, there was a sizeable difference between the two Funds’ equity results; the domestically-oriented Leuthold Core Investment Fund’s equities (+7.99%) performed considerably better than that of the more globally-concentrated Leuthold Global Fund’s equity performance (+2.57%). Specifics related to each Fund’s long-stock performance dynamics are to follow under the heading, “Long Equity Exposure—Domestic & Global Funds.”
Supplementing its U.S.-traded equities, the Leuthold Core Investment Fund began the fiscal year with a long-equity allocation to Emerging Market (EM) stocks; this exposure provided additive performance during the first four months. In early 2018, an internally-tracked model gauging the strength of foreign developed markets/emerging markets began to deteriorate, and due to that, the EM allocation in the Leuthold Core Investment Fund was cut in half during April and finally eliminated in July. The segment experienced a loss of nearly 11% from April through June, reversing the gain captured earlier, and then some. Ultimately, due to its small weight, this partial-year EM equity slice had little impact on full-year results. At this time, EM valuations are attractive compared to the U.S. market, yet relative strength and earnings expectations have both worsened. We don’t believe a
The Leuthold Funds - 2018 Annual Report 3
true reversal in fortune for EM stocks will occur until a cyclical bear market erupts in the U.S. The Leuthold Core Investment Fund will be receptive to again commence investment here when our models indicate that an attractive entry point has been established.
Equity Hedge
Although our stock market outlook was essentially positive at the beginning of the fiscal year, the Leuthold Core Investment Fund and Leuthold Global Fund each maintained an equity hedge throughout the full twelve months. Initially, the hedge was employed as a defensive measure because several key valuation gauges had reached new extremes for the cycle, and long-term forecasts looked weak. From October through January, this was a 7% allocation, on average. In late January, deterioration across several economic and attitudinal inputs convinced us to become more cautious and the equity hedge was therefore upped to 14% between February and March; this served to reduce net equity exposure to about 42%. Reflecting our still-negative outlook for stocks, the hedge was maintained at that level, on average, through fiscal year end.
In a rising market scenario, such as the last twelve months, we presume the equity hedge will be largely subtractive; the intent is to diminish volatility and potentially add some value on the downside, in the case of intermittent market distress. The hedge was constructive in the midst of the sharp decline in early 2018, but following that correction, as overvalued growth stocks continued to get even pricier throughout the summer, the hedge detracted from performance. The losses from this allocation were intensified due to the impact of low-quality (and expensive) momentum stocks leading the upside—these are the type of stocks the short-selling strategy targets. This action amplified losses in the equity-hedge position. For the fiscal year, the negative return from this allocation resulted in a deduction to performance of 2% and 1%, respectively, for the Leuthold Core Investment Fund and Leuthold Global Fund.
Fixed Income
The Leuthold tactical asset allocation funds were underweight fixed income all year, with a 20-21% average weight (versus their customary 30% minimum levels), and the duration was kept at the short end of the scale. Assets were dispensed across securities containing varying risk profiles and exposures. Developed Market Sovereign Debt was the largest subclass at a 12% average weight; Quality Corporate Bonds, Emerging Market Sovereign Debt, and TIPS were the other main components held during the year, with small weights of 5%, 2%, and 1%, respectively. None of the positions had a measurable impact on performance during this fiscal year.
Looking ahead, for the first time in many years, we expect to see rising interest rates across the maturity spectrum which will create more attractive opportunities among fixed income securities. This should allow the Funds to boost exposure in this asset class and generate more measurable levels of income.
Commodities
Worries about inflation pressures heating up while the Fed is seemingly overly fixated on still well-behaved wage inflation figures, rising interest expenses, and commodities on the upswing all motivated the introduction of a 2% position in commodities during May. The holding offers economic exposure to an assorted basket of heavily-traded commodities in the energy, industrial metals, precious metals, and agriculture sectors. We’re not anticipating substantial upside here. Commodities provide the Leuthold tactical asset allocation funds with more diversification and the likelihood for measured gains. Investors putting all their eggs into U.S. equities will likely be disappointed in the next two-to-three years (and probably sooner). Over the short holding period through September 30th, the Funds’ commodities allocations were down slightly, although the size of the positions was too small to influence fiscal year performance.
4 The Leuthold Funds - 2018 Annual Report
Long Equity Exposure—Domestic & Global Funds
Leuthold Select Industries (SI) Fund and Leuthold Global Industries (GI) Fund are fully-invested stock portfolios. Both strategies use the firm’s decades old group-based investment research—a top-down methodology which, firstly, identifies industry groups that appear poised to become market leaders in the given environment, and next, invests in a selection of representative stocks that are highly attractive using a disciplined and quantitative value-oriented process. The archetype, Leuthold Select Industries Fund, became available in mutual fund format in June 2000; it is the domestic version and employs U.S.-traded securities. Global market exposure can also be gained in the SI Fund through foreign companies that list their stocks domestically via American Depositary Shares/Receipts (ADS/ADR). As world equity-market correlations strengthened throughout the decade, we saw the opportunity to extend our group-based investing to the global level, and The Leuthold Global Industries Fund was introduced in May 2010. The GI Fund aims to invest at least 40% of assets in stocks traded on global exchanges outside the U.S.
For the fiscal year ended September 30, 2018, the Leuthold Select Industries Fund had a total return of +8.89%; it underperformed its peer category, Morningstar Mid Cap Blend (+11.68% total return), and the tech-stock powered +17.91% total return of the S&P 500. The Leuthold Global Industries Fund produced a +0.95% total return (retail share class), which trailed both the MSCI ACWI and the Morningstar World Large Stock peer category (+9.77% and +8.87% total returns, respectively).
An uncharacteristic reversal of dynamics between momentum and value factors has been a big burden for many equity funds this year, ours included. Our equity strategies focus on less expensive, high-quality companies within industry groups that have good price and growth trends, and which trade at reasonable valuations. Over time that works very well; however, from January through September 2018, expensive lower-quality momentum stocks outperformed the cheapest stocks by almost 40%. This market attribute in 2018 was the prominent factor behind the Leuthold Select Industries Fund’s relative underperformance compared to the S&P 500; Leuthold Global Industries Fund was obstructed by the same element and had the added unfavorable effect of its international-predisposition, which did not possess the same strength that advanced the U.S. stock market.
Equity Sector And Industry Group Drivers
The Leuthold Select Industries and Leuthold Global Industries Funds’ portfolio construction will have disproportionate broad sector and industry group weights versus the benchmarks. The quantitative methodology intends to identify themes in a position to expand market leadership and/or uphold ongoing strength while avoiding those that may be prone to weakness based on the underlying investment-market backdrop. Selectively concentrating exposures is typically a very effective tactic to add alpha over the long term.
Over the last twelve months, the top two performing equity sectors were Consumer Discretionary and Information Technology (IT). These were the two largest allocations in both the Leuthold Select Industries Fund and Leuthold Global Industries Fund and each contained overweight exposures compared to the benchmarks. The Consumer Discretionary allocation was 29% and 17%, respectively, in the Leuthold Select Industries Fund and Leuthold Global Industries Fund, while Information Technology was held at average weights of 28% and 23%, respectively. Rightly possessing overweight allocations in the best performing sectors is a testament to the effectiveness of the Funds’ sector-rotation approach. Under normal circumstances, this dynamic should translate to impressive outperformance, but this year the underlying holdings in these two sectors contributed the worst relative performance of all the Funds’ sector allocations. The strangely-deficient results of the two Funds’ Consumer Discretionary and IT exposures, versus the benchmarks, was in large part the result of a lack of exposure to industries containing the year’s U.S.-headline dynamo
The Leuthold Funds - 2018 Annual Report 5
stocks, including the FAANG segment and others related to the Social/Mobile/Cloud crusade. Additionally, there was poor performance on an absolute basis from some of the industries that the Funds did have exposure to within the related sectors. These included IT stock positions from Semiconductor Equipment (both Funds), Semiconductors (GI Fund), Electronic Manufacturing Services (SI Fund), and Electronic Equipment & Instruments (GI Fund).
The Health Care (HC) sector was the third largest exposure in the Leuthold Select Industries Fund during the year and it was the third best performing equity sector; its overweight position (18% versus 14% in the S&P 500) was an advantage as it outperformed the benchmark’s corresponding HC allocation by over 200 basis points. The quantitative model correctly recognized continued leadership among the HC segment and thereby directed the SI Fund to retain heavy exposure. Contrary to the circumstances revolving around the Fund’s Consumer Discretionary and IT holdings, in this case the Fund’s productive results reflect the expected benefit of having a large allocation to one of the best performing sectors. Among the SI Fund holdings, stocks from Managed HC and HC Facilities drove performance. The Leuthold Global Industries Fund had a lower weight of 9% within the global Health Care sector (primarily via the Managed HC and HC Equipment & Supplies groups), which ranked as its fifth heaviest sector weighting. This was a smaller position than that of the MSCI ACWI. The globally-traded HC groups produced a positive return for the GI Fund but were not additive against the benchmarks’ exposure, which was ahead by about 50 basis points.
The Financials sector was underweight the benchmarks, in both the SI Fund (12% of assets versus S&P 500’s 15%) and GI Fund (15% of assets versus MSCI ACWI’s 17%). In the SI Fund this sector was a neutral influence; strong stock selection within the Investment Banking & Brokerage group far outperformed that of the S&P 500’s related exposure, while a big SI Fund overweight to poorly performing U.S. Life & Health Insurance stocks detracted to an equitable degree. The GI Fund’s Financials exposure, on the other hand, had additive results from its allocations to the globally-traded Investment Banking & Brokerage and Life & Health Insurance groups; this served to offset the GI Fund’s outsized loss from an overweight exposure in Emerging Diversified Banks. Overall, during the last twelve months, Financials exposure in the GI Fund matched the performance of the benchmark’s corresponding segment.
Energy was held just above a market weight (6.6% of assets on average) in the GI Fund over the last twelve months and contributed similar results as the MSCI ACWI benchmark allocation. The global group exposure to Oil & Gas Refining/Marketing and Coal & Consumable Fuels outperformed, while the Fund’s selection of global stocks within Oil & Gas Exploration/Production was poor. The SI Fund did not have exposure to the relatively strong-performing domestic Energy sector during the fiscal year. However, it’s noteworthy that the 14% twelve-month gain in Energy was entirely attributable to the period from April through June, hence the sector’s results are fairly misleading, and it wasn’t necessarily a disadvantage that our equity-model disciplines did not find domestic Energy stocks appealing for investment.
The GI Fund held a large overweight position to the global Materials sector (16% of assets versus 5% MSCI ACWI), while the SI Fund’s 1.7% allocation was about one percent less than the S&P 500’s weight. The GI Fund benefited from its substantial Materials weight through the industry investments of Paper & Forest Products and Steel—both were large overweights (nearly 11% of assets collectively). These groups combined to contribute 120 basis points to return versus the benchmark’s 11 basis points earned from its minuscule 0.64% exposure to the same groups. Offsetting those global Materials groups’ gains by about 60 basis points was an overweight position in Commodity Chemicals. Domestically, the SI Fund’s minimal exposure to Steel and Forest Products did not materially impact its fiscal year results.
Superior group selection within the Industrials sector (average 9% weight versus 10% S&P 500 weight) provided outstanding results in our domestically-traded SI Fund, which had overweight allocations specifically to Human Resources & Employment Services and Railroads. Together, these two SI Fund groups accounted for a gain of about 150 basis points versus 35 basis points
6 The Leuthold Funds - 2018 Annual Report
achieved by the S&P 500’s corresponding group exposure of less than 1%. The globally-traded GI Fund’s Industrials sector exposure (7% versus 11% for the MSCI ACWI), attained through investments in Transportation Infrastructure and Airlines, did not substantively add nor detract from its fiscal year results.
The Communication Services sector (3% weight versus 4% MSCI ACWI) was valued added for the GI Fund; it held just one underlying industry, Developed Wireless Telecom Services. By avoiding other groups in this sector, the GI Fund bested the benchmark by 50 basis points. For the domestically-oriented SI Fund, the Communication Services sector was immaterial, both in portfolio weight and performance-wise.
Industry groups within Consumer Staples, Real Estate, and Utilities sectors were universally absent from the “Attractive” rankings of our quantitative scoring system throughout the year. There was therefore little-to-no-exposure in either the SI Fund or the GI Fund, and where present, the performance effect thereof was not of consequence.
Foreign/Global Exposure Attribution
With both Funds, concentrations in developed market and emerging market stocks are predominantly arbitrary, the result of: 1) the composition of the groups identified as quantitatively attractive; and, 2) valuation appeal based on the quantitative stock-selection model. Some industries are inclined to have a stronger presence in developed markets versus emerging markets, and vice versa.
Although not part of the strategy objective, the domestically-traded Leuthold Select Industries Fund can, at times, have significant foreign stock exposure which is obtained through ADR/ADS traded on U.S. exchanges. The level thereof, be it minimal or extensive, has the potential to materially affect SI Fund performance, both on an absolute basis and relative to the S&P 500, because foreign stock markets do not perform in lock-step with the U.S. During the fiscal year, there was a 10% weight, on average, to foreign exposure in the SI Fund and it was not advantageous. This was composed of a 70/30 mix in developed markets (ex-USA) and emerging markets, respectively. As illustrated by the MSCI ACWI Ex-USA and the MSCI EM index returns of just +1.76% and -0.81%, respectively, compared to the S&P 500 +17.91% twelve-month return through September 30th, the SI Fund’s foreign-domiciled holdings negatively contributed to its overall underperformance gap.
Leuthold Global Industries Fund aims to have a minimum of 40% in foreign stock exposure; however, specific countries or regions are not explicitly targeted. Rather, the quantitative approach builds the portfolio by selecting stocks from across the globe that appear to best characterize the industry concentrations that the disciplines identify as having the most attractive growth potential. During the last twelve months, on average, U.S. stocks comprised 44% of portfolio assets; developed market stocks (ex-USA) incorporated 38% of assets, and emerging market stocks consisted of an 11% weight. The most notable transformation occurred between the U.S. and emerging market weights. Through the course of the year, U.S. exposure declined from 49% to 39%, whereas stocks comprising emerging markets climbed from 13% to 21%. From a country perspective, the GI Fund’s U.S. stock exposure was the most positive contributor to return. The corresponding U.S. allocation in the MSCI ACWI was a larger position of 51%; it outperformed the Fund’s holdings by about 650 basis points. The GI Fund’s most productive foreign country allocations were Japan, Australia, and Finland, which combined to add 230 basis points, and each outperformed its respective country position in the MSCI ACWI. The largest country detractors for the GI Fund were South Korea, Taiwan, Switzerland, Hong Kong, and Turkey; all of these positions had losses and underperformed the benchmark’s corresponding allocations, which had gains, indicating the Fund’s selection of industries/stocks was substandard. Overall, the
The Leuthold Funds - 2018 Annual Report 7
GI Fund had exposure to 34 countries during the year, the majority of which had flat performance year-over-year and contributed little—either positively or negatively—to fiscal year results.
With regards to the potential risk of currency fluctuations, the Leuthold Global Industries Fund does not implement special practices to circumvent the possibility of unfavorable effects. Some funds employ costly currency-hedging programs, but there is no assurance that such campaigns will be additive to performance. The Leuthold Global Industries Fund does, however, attempt to identify and capitalize on broad FX-market trends through a U.S. dollar-based relative strength component, which is incorporated in the model. This year, strength in the U.S. dollar created a headwind for global equity portfolios, like ours, that do not hedge currency exposure. On an absolute return basis, the last twelve months’ effect of a stronger U.S. dollar undermined the Fund’s return by around 1%. When considered relative to the MSCI ACWI, the currency impact detracted by a much more subdued 40 basis points. This was a reversal of conditions in the prior fiscal year, when weakness in the U.S. dollar added some tailwind. In general, the forces behind U.S. dollar strength/weakness should equalize over time.
Short-Only Equity Fund
100% short individual stocks, the Grizzly Short Fund’s goal is to profit when stock prices decline. For the fiscal year ended September 30, 2018, it produced a -17.83% total return; this was ahead of its peer group average, the Morningstar Bear Market fund category, which returned -19.14%. The Grizzly Short Fund trailed the inverse results of the S&P MidCap 400 (+14.21% total return) and was on par with the inverse S&P 500 (+17.91% total return).
Equity Sector And Industry Group Drivers
Three-quarters of the Grizzly Short Fund’s sector allocations detracted from performance. The heaviest portfolio allocation, Information Technology (18% average weight), was the worst performer by far, dragging down results by over 650 basis points. The underlying IT industries that detracted the most were stocks sold short from Application Software, Internet Software & Services, Semiconductors, and Systems Software.
Health Care was the second worst performing sector for the Fund; it detracted over 350 basis points from return and underperformed the S&P 500 HC sector by 100 basis points. The Fund’s relative underperformance, despite containing only about one-half the weight of the benchmark (8% versus S&P 500 sector weight of 14%), indicates the Fund’s quantitative selection with identifying vulnerable HC-industry stocks was not constructive. Specifically, stocks from the industries of HC Equipment and HC Technology provided most of the sector’s negative contribution.
Consumer Discretionary (13% weight) and Industrials (12% weight) detracted from return by nearly 300 basis points apiece. Consumer Discretionary, however, was 60 basis points additive over the S&P 500 sector, while Industrials underperformed the corresponding S&P 500 sector by 160 basis points. Groups that caused the biggest negative impact within these allocations were Household Appliances, Internet & Direct Marketing Retail, Restaurants, Construction/Engineering, Construction/Machinery/ Heavy Trucks, Industrial Machinery, and Trucking.
A 9% weight in the Energy sector and a 4% weight in Real Estate (overweights versus the benchmark’s sector allocations) further pulled down the fiscal year return by over 260 basis points; they also underperformed their respective S&P 500 sectors’ losses by about 170 basis points. Poor results were almost entirely due to multiple stock positions from Oil & Gas Exploration/Production and the Specialized REITs group.
8 The Leuthold Funds - 2018 Annual Report
Positions within Financials and Utilities sectors had annual average weights on par with the S&P 500 sectors, 14% and 3%, respectively. Each contributed a comparable loss which combined to detract from performance by about 55 basis points. Within these sector exposures, Regional Banks, Reinsurance, Water Utilities, and Electric Utilities contributed the most on the downside.
Materials, Communication Services, and Consumer Staples sectors were constructive allocations during the year and collectively produced a small absolute positive contribution to return of 95 basis points. The respective S&P 500 sectors all had losses, thus comparatively, the Fund’s positions in these sectors also outperformed from a relative perspective, by 138 basis points. It’s worth mentioning that, over the last twelve months, these three sectors were the worst performers among S&P 500 sectors; hence, the presence of these concentrations in the Fund’s portfolio of stocks sold short speaks to the effectiveness of the quantitative approach employed to detect stock market weakness. The most productive industry positions among these sector allocations were Packaged Foods & Meats, Commodity Chemicals, Specialty Chemicals, Fertilizer & Agricultural Chemicals, and Alternative Carriers.
Often the Grizzly Short Fund contains well-defined sector overweights and/or underweights due to the disciplines either identifying mutual weakness across an industry—which results in an overweight exposure—or industries exhibiting stock market strength—which materializes as underweight, or zero exposure in the portfolio. Because the S&P 500 maintains a static allocation to industries/sectors, regardless of shifting market weakness and strength, we expect such Grizzly Short Fund/S&P 500 sector deviations to eventually result in a meaningful advantage for the Fund. Needless to say, outsized sector/group wagers in the Fund can also be upended and become a detriment during times of short-term reshuffling of leadership or inexplicably powerful market reversals.
The Grizzly Short Fund is a quantitative methodology for identifying mid/large cap stocks with ample liquidity that appear to be overvalued and, therefore, vulnerable to decline in price; the strategy does not attempt to identify “terminal shorts” —public companies which may be on the brink of collapse or failure. Portfolio stock positions are closely monitored intra-day and high turnover should be expected. As noted, sector concentrations and industry group compositions have the potential to fluctuate considerably, unlike the S&P 500 sector/group weights. Fund safeguards include specific procedures that trigger short-covering action to lock in certain gains and/or stop losses, while sector and sub-industry group concentrations utilize weighting controls to avoid the susceptibility of overexposure. In addition, the Fund’s individual stock positions are similarly weighted across the portfolio; it’s therefore unlikely that a select few stocks could have an overwhelming effect on performance, as can occur in a cap-weighted index—illustrated this year by the gains in Amazon, Apple, and Microsoft which were responsible for 37% of the S&P 500 YTD return through September 30th.
It should go without saying, bull markets are not conducive to short selling, and this year was no exception. Multiple new market highs, passive management outperforming active management, and low-quality momentum stocks crushing inexpensive value stocks made the last twelve months ever- more challenging for the Grizzly Short Fund. At present, our quantitative analysis implies that we have entered a phase that will be difficult for the stock market. If that is correct, the Grizzly Short Fund’s opportunities will surely multiply. If we have indeed entered the bear market stage of this cycle, the Fund should be in a solid position to attempt to secure strong additive returns to counterbalance recent years’ losses, as well as assemble a positive performance cushion against the unavoidable setbacks of the bull market next in line.
The Leuthold Funds - 2018 Annual Report 9
Fake-Out Or Break-Out?
Life was simpler in 2017. Markets were in gear on the upside, our monetary measures were bullish, tax cuts were in the offing, and the only tariff in sight was the one imposed on those pesky Canadian-softwood producers. And stocks were… well, a bit less overvalued than they are now. The weight of the evidence was decisively bullish one year ago.
Today, our stock market disciplines are negative and, as of late October, our Leuthold tactical asset allocation funds are positioned with very defensive net equity exposure of 36%. The rally off the early-2018 lows has been disjointed (if not conventionally narrow) and even as the S&P 500 climbed to a new bull market high on September 20th, our stock market analysis continued to deteriorate—a negative sign. On the whole, our disciplines advise that we treat the September break-out as a potential head-fake.
Perhaps it’s pure coincidence, but the last three “recession-induced” bear markets (1990, 2000, and 2007) all suffered a final correction similar in size to that seen in the S&P 500 earlier this year. The market recovered more quickly in all three cases than it did this year, but the relief turned out to be short-lived. In each case, a bear market loomed within either a few days (2007) or weeks (1990 and 2000), and recessions eventually followed.
We think the odds are better-than-even that the S&P 500 high on September 20th will stand as the stock market peak for 2018, and perhaps the ultimate top for this extraordinary bull market that began back in 2009. Supplementary evidence that the long-forgotten bear may be emerging from hibernation are the “bear paw prints” on four relative performance ratios. These series represent the enduring leadership themes that have defined this cyclical bull market: growth over value, U.S. over foreign, financial over real assets and, obviously, momentum over ‘everything else.’ Yes, there have been occasional interruptions within these themes during the course of the bull run, but each managed to eventually reassert itself and, fittingly, become even more dominant as the bull persevered.
While the bull might be able to deal with the loss of one or two of these long-term themes, we don’t think it can survive losing them all. The relative strength of momentum stocks has broken below its 200-day moving average, suggesting the bear has already claimed one of its ringleaders. Additional failures among these ratios would be viewed as more paw prints corroborating the bear’s revival.
We’d be more definitive that a new bear market is underway had there been more of the traditional signs of market fracturing leading up to last month’s high, but we won’t obsess over the absence of such warnings. The catalyst for market weakness is the decline in accommodation by the Fed and other central banks, and the pace of this tightening has been accelerating. Furthermore, the technical backdrop has been worsening and key trend measures have broken down; in our view, if one has the flexibility to manage stock market exposure, the proper position is a very defensive one.
10 The Leuthold Funds - 2018 Annual Report
It will be some time before we’ll know whether or not our current cautionary stance toward stocks is warranted. In the interim, we’ll rely on our market disciplines to guide us, and portfolios will be adjusted where appropriate to position shareholder assets with the investment vehicles that we believe fit the conditions to deliver the desired outcomes. We endeavor to preserve shareholder principal and minimize losses in the case of a down market and, when the stock market looks attractive based on our measures, we strive to accrue gains and growth of capital. As fellow shareholders, having your best interests at heart and our own best interests at heart is not mutually exclusive; we work hard to achieve the best possible results, given the circumstances, for us all.
Sincerely,
Doug Ramsey, CFA, CMT
CIO & Co-Portfolio Manager
 |  |  |
| Chun Wang, CFA, PRM | Jun Zhu, CFA | Greg Swenson, CFA |
| Co-Portfolio Manager | Co-Portfolio Manager | Co-Portfolio Manager |
Kristen Perleberg, CFA
Co-Portfolio Manager
Co-Portfolio Manager
The Leuthold Funds - 2018 Annual Report 11
| The Leuthold Funds |
As a shareholder of the Funds, 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 the Funds 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 (April 1, 2018 – September 30, 2018).
Actual Expenses
The first line of the following tables provide information about actual account values and actual expenses. Although the Funds charge no sales load (the Leuthold Core Investment Fund, Leuthold Global Fund, and Leuthold Global Industries Fund charge a 2% redemption fee for redemptions made within five business days after a purchase), you will be assessed fees for outgoing wire transfers, returned checks, or stop payment orders at prevailing rates charged by U.S. Bancorp Fund Services, LLC, the Funds’ transfer agent. If you request a redemption be made by wire transfer, currently a $15.00 fee is charged by the Funds’ transfer agent. To the extent that the Funds invest in shares of other investment companies as part of its investment strategy, you will indirectly bear your proportionate share of any fees and expenses charged by the underlying funds in which a Fund invests in addition to the expenses of the Fund. Actual expenses of the underlying funds are expected to vary by fund. These expenses are not included in the following examples. The examples include, but are not limited to, management fees, shareholder servicing fees, fund accounting, custody, and transfer agent fees. However, the following examples do not include portfolio trading commissions and related expenses, and extraordinary expenses as determined under generally accepted accounting principles. You may use the information in this line, 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 in the first line under the heading entitled “Expenses Paid During Period” to estimate the expenses you paid on your account during this period.
Hypothetical Examples for Comparison Purposes
The second line of the following tables provide information about hypothetical account values and hypothetical expenses based on the Funds’ actual expense ratios and an assumed rate of return of 5% per year before expenses, which is not the Funds’ actual return. The hypothetical account values and expenses may not be used to estimate the actual ending account balance or expenses you paid for the period. You may use this information to compare the ongoing costs of investing in the Funds and other funds. To do so, compare this 5% hypothetical example with the 5% hypothetical examples that appear in the shareholder reports of the other funds.
Please note that the expenses shown in the tables are meant to highlight your ongoing costs only and do not reflect any transactional costs, such as redemption fees or exchange fees. Therefore, the second line of the tables is useful in comparing ongoing costs only, and will not help you determine the relative costs of owning different funds. In addition, if these transactional costs were included, your costs would have been higher.
| 12 | The Leuthold Funds - 2018 Annual Report |
| The Leuthold Funds |
| Expense Example Tables (Unaudited) |
Leuthold Core Investment Fund - Retail Class - LCORX
Beginning Account Value April 1, 2018 | Ending Account Value September 30, 2018 | Expenses Paid During Period* April 1, 2018 - September 30, 2018 | ||||||||||
| Actual** | $ | 1,000.00 | $ | 991.80 | $ | 7.14 | ||||||
| Hypothetical (5% return before expenses)*** | 1,000.00 | 1,017.90 | 7.23 | |||||||||
| * | Expenses are equal to the Fund’s annualized expense ratio of 1.43%, multiplied by the average account value over the period, multiplied by 183/365 to reflect the one-half year period. |
| ** | Excluding dividends and interest on securities sold short, your actual cost of investment in the Fund would be $5.94 and the Fund’s annualized expense ratio would be 1.19%. |
| *** | Excluding dividends and interest on securities sold short, your hypothetical cost of investment in the Fund would be $6.02 and the Fund’s annualized expense ratio would be 1.19% |
Leuthold Core Investment Fund - Institutional Class - LCRIX
Beginning Account Value April 1, 2018 | Ending Account Value September 30, 2018 | Expenses Paid During Period* April 1, 2018 - September 30, 2018 | ||||||||||
| Actual** | $ | 1,000.00 | $ | 992.30 | $ | 6.59 | ||||||
| Hypothetical (5% return before expenses)*** | 1,000.00 | 1,018.45 | 6.68 | |||||||||
| * | Expenses are equal to the Fund’s annualized expense ratio of 1.32%, multiplied by the average account value over the period, multiplied by 183/365 to reflect the one-half year period. |
| ** | Excluding dividends and interest on securities sold short, your actual cost of investment in the Fund would be $5.44 and the Fund’s annualized expense ratio would be 1.09%. |
| *** | Excluding dividends and interest on securities sold short, your hypothetical cost of investment in the Fund would be $5.52 and the Fund’s annualized expense ratio would be 1.09%. |
Leuthold Global Fund - Retail Class - GLBLX
Beginning Account Value April 1, 2018 | Ending Account Value September 30, 2018 | Expenses Paid During Period* April 1, 2018 - September 30, 2018 | ||||||||||
| Actual** | $ | 1,000.00 | $ | 961.20 | $ | 9.78 | ||||||
| Hypothetical (5% return before expenses)*** | 1,000.00 | 1,015.09 | 10.05 | |||||||||
| * | Expenses are equal to the Fund’s annualized expense ratio of 1.99%, multiplied by the average account value over the period, multiplied by 183/365 to reflect the one-half year period. |
| ** | Excluding dividends and interest on securities sold short, your actual cost of investment in the Fund would be $8.26 and the Fund’s annualized expense ratio would be 1.68%. |
| *** | Excluding dividends and interest on securities sold short, your hypothetical cost of investment in the Fund would be $8.49 and the Fund’s annualized expense ratio would be 1.68%. |
Leuthold Global Fund - Institutional Class - GLBIX
Beginning Account Value April 1, 2018 | Ending Account Value September 30, 2018 | Expenses Paid During Period* April 1, 2018 - September 30, 2018 | ||||||||||
| Actual** | $ | 1,000.00 | $ | 963.30 | $ | 7.92 | ||||||
| Hypothetical (5% return before expenses)*** | 1,000.00 | 1017.00 | 8.14 | |||||||||
| * | Expenses are equal to the Fund’s annualized expense ratio of 1.61%, multiplied by the average account value over the period, multiplied by 183/365 to reflect the one-half year period. |
| ** | Excluding dividends and interest on securities sold short, your actual cost of investment in the Fund would be $6.40 and the Fund’s annualized expense ratio would be 1.30%. |
| *** | Excluding dividends and interest on securities sold short, your hypothetical cost of investment in the Fund would be $6.58 and the Fund’s annualized expense ratio would be 1.30%. |
| The Leuthold Funds - 2018 Annual Report | 13 |
| The Leuthold Funds |
| Expense Example Tables (Unaudited) (continued) |
Leuthold Select Industries Fund - Retail Class - LSLTX
Beginning Account Value April 1, 2018 | Ending Account Value September 30, 2018 | Expenses Paid During Period* April 1, 2018 - September 30, 2018 | ||||||||||
| Actual | $ | 1,000.00 | $ | 1,033.60 | $ | 7.65 | ||||||
| Hypothetical (5% return before expenses) | 1,000.00 | 1,017.55 | 7.59 | |||||||||
| * | Expenses are equal to the Fund’s annualized expense ratio of 1.50%, multiplied by the average account value over the period, multiplied by 183/365 to reflect the one-half period. |
Leuthold Global Industries Fund - Retail Class - LGINX
Beginning Account Value April 1, 2018 | Ending Account Value September 30, 2018 | Expenses Paid During Period* April 1, 2018 - September 30, 2018 | ||||||||||
| Actual | $ | 1,000.00 | $ | 967.40 | $ | 7.40 | ||||||
| Hypothetical (5% return before expenses) | 1,000.00 | 1,017.55 | 7.59 | |||||||||
| * | Expenses are equal to the Fund’s annualized expense ratio of 1.50%, multiplied by the average account value over the period, multiplied by 183/365 to reflect the one-half period. |
Leuthold Global Industries Fund - Institutional Class - LGIIX
Beginning Account Value April 1, 2018 | Ending Account Value September 30, 2018 | Expenses Paid During Period* April 1, 2018 - September 30, 2018 | ||||||||||
| Actual | $ | 1,000.00 | $ | 968.70 | $ | 6.17 | ||||||
| Hypothetical (5% return before expenses) | 1,000.00 | 1,018.80 | 6.33 | |||||||||
| * | Expenses are equal to the Fund’s annualized expense ratio of 1.25%, multiplied by the average account value over the period, multiplied by 183/365 to reflect the one-half period. |
Grizzly Short Fund - Retail Class - GRZZX
| Beginning Account Value April 1, 2018 | Ending Account Value September 30, 2018 | Expenses Paid During Period* April 1, 2018 - September 30, 2018 | ||||||||||
Actual** | $ | 1,000.00 | $ | 886.00 | $ | 12.67 | ||||||
Hypothetical (5% return before expenses)*** | 1,000.00 | 1,011.63 | 13.51 | |||||||||
| * | Expenses are equal to the Fund’s annualized expense ratio of 2.68%, multiplied by the average account value over the period, multiplied by 183/365 to reflect the one-half period. |
| ** | Excluding dividends and interest on securities sold short, your actual cost of investment in the Fund would be $7.47 and the Fund’s annualized expense ratio would be 1.58%. |
| *** | Excluding dividends and interest on securities sold short, your hypothetical cost of investment in the Fund would be $7.99 and the Fund’s annualized expense ratio would be 1.58%. |
| 14 | The Leuthold Funds - 2018 Annual Report |
| The Leuthold Funds |
| (Unaudited) |
Leuthold Global Fund
Allocation of Portfolio Holdings
September 30, 2018
Allocation of Portfolio Holdings
September 30, 2018
| ^ | Amount is less than 0.05%. |
| Reflected as a percent of absolute value of investments and securities sold short. |
| The Leuthold Funds - 2018 Annual Report | 15 |
| The Leuthold Funds |
| (Unaudited) |
Leuthold Select Industries Fund
Allocation of Portfolio Holdings
September 30, 2018*
Leuthold Global Industries Fund
Allocation of Portfolio Holdings
September 30, 2018*
 |
| * | Excludes short-term investments less than 5% of net assets. |
| ** | For presentation purposes, the Fund has grouped some of the industry classifications. For purposes of categorizing securities for compliance with Section 8(b)(1) of the Investment Company Act of 1940, the Fund uses more specific industry classifications. |
| Reflected as a percent of absolute value of investments and securities sold short. |
| 16 | The Leuthold Funds - 2018 Annual Report |
The Leuthold Funds |
| (Unaudited) |
Grizzly Short Fund
Allocation of Securities Sold Short
September 30, 2018
Allocation of Securities Sold Short
September 30, 2018
Reflected as a percent of absolute value of investments and securities sold short.
| The Leuthold Funds - 2018 Annual Report | 17 |
| Leuthold Core Investment Fund - Retail Class - LCORX |
| (Unaudited) |
Average Annual Rate of Return For Periods Ended
September 30, 2018
September 30, 2018
| 1 Year | 3 Year | 5 Year | 10 Year | Since Inception | ||||||||||||||||
| Leuthold Core Investment Fund - Retail Class - LCORX | 3.23 | % | 6.29 | % | 6.85 | % | 6.00 | % | 8.35 | % | ||||||||||
| Lipper Flexible Portfolio Fund Index | 5.89 | % | 9.25 | % | 6.35 | % | 7.28 | % | 6.49 | % | ||||||||||
| S&P 500 Index | 17.91 | % | 17.31 | % | 13.95 | % | 11.97 | % | 9.23 | % | ||||||||||
| Morningstar Tactical Allocation Index | 5.60 | % | 7.02 | % | 4.66 | % | 5.96 | % | 5.21 | % | ||||||||||
| Bloomberg Barclays Global Aggregate Index | (1.32 | )% | 1.98 | % | 0.75 | % | 2.89 | % | 2.29 | % | ||||||||||
The Lipper Flexible Portfolio Funds Index is composed of funds that allocate investments across various asset classes with a focus on total return, as defined by Lipper.
The S&P 500 Index is an unmanaged capitalization-weighted index of 500 stocks designed to measure performance of the broad domestic economy through changes in the aggregate market value of the 500 stocks, which represent all major industries.
The Morningstar Tactical Allocation Index is comprised of funds that incorporate a tactical asset allocation strategy which is the process by which the asset of a fund is changed on a short-term basis to take advantage of perceived differences in relative values of the various asset classes.
The Bloomberg Barclays Global Aggregate Index provides a broad-based measure of the global investment grade fixed-rate debt markets. It is comprised of the U.S. Aggregate, Pan-European Aggregate, the Asian-Pacific Aggregate Indices, and the Canadian Aggregate Indices. It also includes a wide range of standard and customized sub-indices by liquidity constraint, sector, quality, and maturity.
This chart assumes an initial gross investment of $10,000 made on November 20, 1995 (commencement of operations). Returns shown include the reinvestment of all dividends. The Fund’s past performance is not necessarily an indication of its future performance. It may perform better or worse in the future. The graph and the table do not reflect the deduction of taxes that a shareholder would pay on Fund distributions or the redemption of shares.
| 18 | The Leuthold Funds - 2018 Annual Report |
| Leuthold Core Investment Fund - Institutional Class - LCRIX |
| (Unaudited) |
Average Annual Rate of Return For Periods Ended
September 30, 2018
September 30, 2018
| 1 Year | 3 Year | 5 Year | 10 Year | Since Inception | ||||||||||||||||
| Leuthold Core Investment Fund - Institutional Class - LCRIX | 3.35 | % | 6.43 | % | 6.96 | % | 6.12 | % | 5.63 | % | ||||||||||
| Lipper Flexible Portfolio Fund Index | 5.89 | % | 9.25 | % | 6.35 | % | 7.28 | % | 5.80 | % | ||||||||||
| S&P 500 Index | 17.91 | % | 17.31 | % | 13.95 | % | 11.97 | % | 8.99 | % | ||||||||||
| Morningstar Tactical Allocation Index | 5.60 | % | 7.02 | % | 4.66 | % | 5.96 | % | 3.41 | % | ||||||||||
| Bloomberg Barclays Global Aggregate Index | (1.32 | )% | 1.98 | % | 0.75 | % | 2.89 | % | 3.39 | % | ||||||||||
A $1,000,000 investment in the Leuthold Core Investment Fund – Institutional Class - LCRIX
The Lipper Flexible Portfolio Funds Index is composed of funds that allocate investments across various asset classes with a focus on total return, as defined by Lipper.
The S&P 500 Index is an unmanaged capitalization-weighted index of 500 stocks designed to measure performance of the broad domestic economy through changes in the aggregate market value of the 500 stocks, which represent all major industries.
The Morningstar Tactical Allocation Index is comprised of funds that incorporate a tactical asset allocation strategy which is the process by which the asset of a fund is changed on a short-term basis to take advantage of perceived differences in relative values of the various asset classes.
The Bloomberg Barclays Global Aggregate Index provides a broad-based measure of the global investment grade fixed-rate debt markets. It is comprised of the U.S. Aggregate, Pan-European Aggregate, the Asian-Pacific Aggregate Indices, and the Canadian Aggregate Indices. It also includes a wide range of standard and customized sub-indices by liquidity constraint, sector, quality, and maturity.
This chart assumes an initial gross investment of $1,000,000 made on January 31, 2006 (commencement of operations). Returns shown include the reinvestment of all dividends. The Fund’s past performance is not necessarily an indication of its future performance. It may perform better or worse in the future. The graph and the table do not reflect the deduction of taxes that a shareholder would pay on Fund distributions or the redemption of shares.
| The Leuthold Funds - 2018 Annual Report | 19 |
| Leuthold Global Fund - Retail Class - GLBLX |
| (Unaudited) |
Average Annual Rate of Return For Periods Ended
September 30, 2018
September 30, 2018
| 1 Year | 3 Year | 5 Year | 10 Year | Since Inception | |||||
| Leuthold Global Fund - Retail Class - GLBLX | (0.67)% | 4.27% | 3.78% | 6.21% | 4.50% | ||||
| MSCI ACWI | 9.77% | 13.40% | 8.67% | 8.19% | 6.17% | ||||
| Bloomberg Barclays Global Aggregate Index | (1.32)% | 1.98% | 0.75% | 2.89% | 2.44% | ||||
| S&P 500 Index | 17.91% | 17.31% | 13.95% | 11.97% | 10.67% |
A $10,000 investment in the Leuthold Global Fund - Retail Class - GLBLX
The MSCI ACWI (All Country World Index) is designed to represent performance of the full opportunity set of large- and mid-cap stocks across 23 developed and 24 emerging markets.
The Bloomberg Barclays Global Aggregate Index provides a broad-based measure of the global investment grade fixed-rate debt markets. It is comprised of the U.S. Aggregate, Pan-European Aggregate, the Asian-Pacific Aggregate Indices, and the Canadian Aggregate Indices. It also includes a wide range of standard and customized sub-indices by liquidity constraint, sector, quality, and maturity.
The S&P 500 Index is an unmanaged capitalization-weighted index of 500 stocks designed to measure performance of the broad domestic economy through changes in the aggregate market value of the 500 stocks, which represent all major industries.
This chart assumes an initial gross investment of $10,000 made on July 1, 2008 (commencement of operations). Returns shown include the reinvestment of all dividends. The Fund’s past performance is not necessarily an indication of its future performance. It may perform better or worse in the future. The graph and the table do not reflect the deduction of taxes that a shareholder would pay on Fund distributions or the redemption of shares.
| 20 | The Leuthold Funds - 2018 Annual Report |
| Leuthold Global Fund - Institutional Class - GLBIX |
| (Unaudited) |
Average Annual Rate of Return For Periods Ended
September 30, 2018
September 30, 2018
| 1 Year | 3 Year | 5 Year | 10 Year | Since Inception | |||||
| Leuthold Global Fund - Institutional Class - GLBIX | (0.43)% | 4.53% | 4.01% | 6.45% | 4.55% | ||||
| MSCI ACWI | 9.77% | 13.40% | 8.67% | 8.19% | 5.27% | ||||
| Bloomberg Barclays Global Aggregate Index | (1.32)% | 1.98% | 0.75% | 2.89% | 2.29% | ||||
| S&P 500 Index | 17.91% | 17.31% | 13.95% | 11.97% | 9.73% |
A $1,000,000 investment in the Leuthold Global Fund - Institutional Class - GLBIX
The MSCI ACWI (All Country World Index) is designed to represent performance of the full opportunity set of large- and mid-cap stocks across 23 developed and 24 emerging markets.
The Bloomberg Barclays Global Aggregate Index provides a broad-based measure of the global investment grade fixed-rate debt markets. It is comprised of the U.S. Aggregate, Pan-European Aggregate, the Asian-Pacific Aggregate Indices, and the Canadian Aggregate Indices. It also includes a wide range of standard and customized sub-indices by liquidity constraint, sector, quality, and maturity.
The S&P 500 Index is an unmanaged capitalization-weighted index of 500 stocks designed to measure performance of the broad domestic economy through changes in the aggregate market value of the 500 stocks, which represent all major industries.
This chart assumes an initial gross investment of $1,000,000 made onApril 30, 2008 (commencement of operations). Returns shown include the reinvestment of all dividends. The Fund’s past performance is not necessarily an indication of its future performance. It may perform better or worse in the future. The graph and the table do not reflect the deduction of taxes that a shareholder would pay on Fund distributions or the redemption of shares.
| The Leuthold Funds - 2018 Annual Report | 21 |
| Leuthold Select Industries Fund - LSLTX |
| (Unaudited) |
Average Annual Rate of Return For Periods Ended
September 30, 2018
September 30, 2018
| 1 Year | 3 Year | 5 Year | 10 Year | Since Inception | |||||
| Leuthold Select Industries Fund - LSLTX | 8.89% | 10.97% | 11.56% | 8.44% | 8.09% | ||||
| Russell 2000 Index | 15.24% | 17.12% | 11.07% | 11.11% | 8.08% | ||||
| Lipper Multi-Cap Core Funds Index | 15.25% | 15.49% | 11.76% | 11.13% | 5.92% | ||||
| S&P 500 Index | 17.91% | 17.31% | 13.95% | 11.97% | 5.80% |
A $10,000 investment in the Leuthold Select Industries Fund - LSLTX
The Russell 2000 Index is comprised of approximately 2000 of the smallest companies in the Russell 3000 Index, representing approximately 10% of the Russell 3000 total market capitalization.
The Lipper Multi-Cap Core Funds Index is an average of funds that invest in a variety of market capitalization ranges without concentrating 75% of their equity assets in any one market capitalization range over an extended period of time. Multi-cap funds typically have between 25% and 75% of their assets invested in companies with market capitalizations (on a three-year weighted basis) above 300% of the dollar-weighted median market capitalization of the middle 1,000 securities of the S&P SuperComposite 1500 Index. These funds typically have an average price-to-earnings ratio, price-to-book ratio, and three-year sales-per-share growth value, compared to the S&P SuperComposite 1500 Index.
The S&P 500 Index is an unmanaged capitalization-weighted index of 500 stocks designed to measure performance of the broad domestic economy through changes in the aggregate market value of the 500 stocks, which represent all major industries.
This chart assumes an initial gross investment of $10,000 made on June 19, 2000 (commencement of operations). Returns shown include the reinvestment of all dividends. The Fund’s past performance is not necessarily an indication of its future performance. It may perform better or worse in the future. The graph and the table do not reflect the deduction of taxes that a shareholder would pay on Fund distributions or the redemption of shares.
| 22 | The Leuthold Funds - 2018 Annual Report |
| Leuthold Global Industries Fund - Retail Class - LGINX |
| (Unaudited) |
Average Annual Rate of Return For Periods Ended
September 30, 2018
September 30, 2018
| 1 Year | 3 Year | 5 Year | Since Inception | |||||||||||||
| Leuthold Global Industries Fund - Retail Class - LGINX | 0.95 | % | 8.01 | % | 6.53 | % | 9.16 | % | ||||||||
| MSCI ACWI | 9.77 | % | 13.40 | % | 8.67 | % | 9.77 | % | ||||||||
| Lipper Global Multi-Cap Value Index | 5.18 | % | 10.78 | % | 6.52 | % | 9.03 | % | ||||||||
| S&P 500 Index | 17.91 | % | 17.31 | % | 13.95 | % | 14.26 | % | ||||||||
A $10,000 investment in the Leuthold Global Industries Fund - Retail Class - LGINX
The MSCI ACWI (All Country World Index) is designed to represent performance of the full opportunity set of large- and mid-cap stocks across 23 developed and 24 emerging markets.
The Lipper Global Multi-Cap Value Index is an index that measures investment in a variety of market capitalization ranges without concentrating 75% of their equity assets in any one market capitalization range over an extended period of time. Typically this index has 25% to 75% of their assets invested in companies both inside and outside of the U.S. with market capitalizations (on a three-year weighted basis) above 400% of the 75th market capitalization percentile of the S&P/Citigroup World Broad Market Index.
The S&P 500 Index is an unmanaged capitalization-weighted index of 500 stocks designed to measure performance of the broad domestic economy through changes in the aggregate market value of the 500 stocks, which represent all major industries.
This chart assumes an initial gross investment of $10,000 made on May 17, 2010 (commencement of operations). Returns shown include the reinvestment of all dividends. The Fund’s past performance is not necessarily an indication of its future performance. It may perform better or worse in the future. The graph and the table do not reflect the deduction of taxes that a shareholder would pay on Fund distributions or the redemption of shares.
| The Leuthold Funds - 2018 Annual Report | 23 |
| Leuthold Global Industries Fund - Institutional Class - LGIIX |
| (Unaudited) |
Average Annual Rate of Return For Periods Ended
September 30, 2018
September 30, 2018
| 1 Year | 3 Year | 5 Year | Since Inception | |||||||||||||
| Leuthold Global Industries Fund - Institutional Class - LGIIX | 1.17 | % | 8.27 | % | 6.79 | % | 9.45 | % | ||||||||
| MSCI ACWI | 9.77 | % | 13.40 | % | 8.67 | % | 9.77 | % | ||||||||
| Lipper Global Multi-Cap Value Index | 5.18 | % | 10.78 | % | 6.52 | % | 9.03 | % | ||||||||
| S&P 500 Index | 17.91 | % | 17.31 | % | 13.95 | % | 14.26 | % | ||||||||
A $1,000,000 investment in the Leuthold Global Industries Fund - Institutional Class - LGIIX
The MSCI ACWI (All Country World Index) is designed to represent performance of the full opportunity set of large- and mid-cap stocks across 23 developed and 24 emerging markets.
The Lipper Global Multi-Cap Value Index is an index that measures investment in a variety of market capitalization ranges without concentrating 75% of their equity assets in any one market capitalization range over an extended period of time. Typically this index has 25% to 75% of their assets invested in companies both inside and outside of the U.S. with market capitalizations (on a three-year weighted basis) above 400% of the 75th market capitalization percentile of the S&P/Citigroup World Broad Market Index.
The S&P 500 Index is an unmanaged capitalization-weighted index of 500 stocks designed to measure performance of the broad domestic economy through changes in the aggregate market value of the 500 stocks, which represent all major industries.
This chart assumes an initial gross investment of $1,000,000 made on May 17, 2010 (commencement of operations). Returns shown include the reinvestment of all dividends. The Fund’s past performance is not necessarily an indication of its future performance. It may perform better or worse in the future. The graph and the table do not reflect the deduction of taxes that a shareholder would pay on Fund distributions or the redemption of shares.
| 24 | The Leuthold Funds - 2018 Annual Report |
| Grizzly Short Fund - GRZZX |
| (Unaudited) |
Average Annual Rate of Return For Periods Ended
September 30, 2018
September 30, 2018
| 1 Year | 3 Year | 5 Year | 10 Year | Since Inception | |||||
| Grizzly Short Fund - GRZZX | (17.83)% | (17.96)% | (12.47)% | (16.92)% | (8.21)% | ||||
| Lipper Dedicated Short Bias | (18.06)% | (23.19)% | (19.35)% | (20.35)% | n/a* | ||||
| S&P MidCap 400 Index | 14.21% | 15.68% | 11.91% | 12.49% | 9.40% | ||||
| S&P 500 Index | 17.91% | 17.31% | 13.95% | 11.97% | 5.80% |
A $10,000 investment in the Grizzly Short Fund - GRZZX
The Lipper Dedicated Short Bias Funds Index is an equally weighted representation of funds in the Lipper Dedicated Short Bias category. These funds employ a hedge fund strategy that maintains a net short exposure to the market through a combination of short and long positions. A dedicated short bias investment strategy attempts to capture profits when the market declines, by holding investments that are overall biased to the short side.
The S&P MidCap 400 Index is a capitalization-weighted index, which measures the performance of the mid-range sector of the U.S. stock market. The index was developed with a base level of 100 as of December 31, 1990.
The S&P 500 Index is an unmanaged capitalization-weighted index of 500 stocks designed to measure performance of the broad domestic economy through changes in the aggregate market value of the 500 stocks, which represent all major industries.
This chart assumes an initial gross investment of $10,000 made on June 19, 2000 (commencement of operations). Returns shown include the reinvestment of all dividends. The Fund’s past performance is not necessarily an indication of its future performance. It may perform better or worse in the future. The graph and the table do not reflect the deduction of taxes that a shareholder would pay on Fund distributions or the redemption of shares.
| *Index was introduced in July 2003. | The Leuthold Funds - 2018 Annual Report | 25 |
| The Leuthold Funds |
| September 30, 2018 |
Leuthold Core Investment Fund | Leuthold Global Fund | Leuthold Select Industries Fund | ||||||||||
| ASSETS: | ||||||||||||
| Investments, at cost | ||||||||||||
| Unaffiliated Securities | $ | 786,315,052 | * | $ | 88,532,136 | * | $ | 14,384,129 | ||||
| Affiliated Securities | 24,721,848 | — | — | |||||||||
| Total Investments, at cost | 811,036,900 | 88,532,136 | 14,384,129 | |||||||||
| Investments, at fair value | ||||||||||||
| Unaffiliated Securities | 897,340,301 | 92,413,122 | 18,147,472 | |||||||||
| Affiliated Securities | 24,151,976 | — | — | |||||||||
| Total Investments, at fair value | 921,492,277 | 92,413,122 | 18,147,472 | |||||||||
| Foreign currency (cost $0, $114,719, and $0, respectively) | — | 114,617 | — | |||||||||
| Receivable for Fund shares sold | 560,287 | 11,033 | — | |||||||||
| Receivable for investments sold | 52,120,856 | 7,413,295 | 1,369,607 | |||||||||
| Collateral at broker for securities sold short | 120,187,945 | 12,192,043 | — | |||||||||
| Tri-party collateral held at custodian | 20,000,001 | 2,200,001 | — | |||||||||
| Interest receivable | 885,475 | 98,919 | 82 | |||||||||
| Dividends receivable | 297,739 | 272,857 | 10,550 | |||||||||
| Securities lending income receivable | 75,690 | 6,909 | — | |||||||||
| Other assets | 193,596 | 25,791 | 11,288 | |||||||||
| Total Assets | 1,115,813,866 | 114,748,587 | 19,538,999 | |||||||||
| LIABILITIES: | ||||||||||||
Securities sold short, at fair value (proceeds $120,163,825, $12,161,374, and $0, respectively) | 118,227,168 | 11,893,558 | — | |||||||||
| Collateral received for securities loaned | 106,078,956 | 12,218,224 | — | |||||||||
| Payable for investments purchased | 52,394,129 | 7,308,235 | 1,367,352 | |||||||||
| Payable for Fund shares redeemed | 209,257 | 301,047 | — | |||||||||
| Payable to Adviser | 625,655 | 61,831 | 9,428 | |||||||||
| Payable to Custodian | 61,844 | 26,760 | 5,458 | |||||||||
| Payable to Directors | 42,305 | 4,711 | 960 | |||||||||
| Dividends payable on securities sold short | 368,264 | 3,750 | — | |||||||||
| Distribution (Rule 12b-1) fees payable | — | 60,910 | — | |||||||||
| Shareholder servicing fees payable | 76,777 | — | 3,754 | |||||||||
| Accrued expenses and other liabilities | 470,275 | 118,403 | 40,115 | |||||||||
| Total Liabilities | 278,554,630 | 31,997,429 | 1,427,067 | |||||||||
| NET ASSETS | $ | 837,259,236 | $ | 82,751,158 | $ | 18,111,932 | ||||||
| * Includes loaned securities with market value of: | $ | 103,834,675 | $ | 11,900,300 | n/a | |||||||
| 26 | The Leuthold Funds - 2018 Annual Report | See Notes to the Financial Statements. |
| The Leuthold Funds |
| Statements of Assets and Liabilities (continued) |
| September 30, 2018 |
Leuthold Core Investment Fund | Leuthold Global Fund | Leuthold Select Industries Fund | ||||||||||
| NET ASSETS CONSIST OF: | ||||||||||||
| Capital stock | $ | 652,745,224 | $ | 73,564,244 | $ | 13,279,126 | ||||||
| Total distributable earnings | 184,514,012 | 9,186,914 | 4,832,806 | |||||||||
| Total Net Assets | $ | 837,259,236 | $ | 82,751,158 | $ | 18,111,932 | ||||||
| Retail Class Shares | ||||||||||||
| Net assets | $ | 403,095,456 | $ | 18,362,218 | $ | 18,111,932 | ||||||
| Shares outstanding (1,000,000,000 shares of $0.0001 par value authorized) | 19,664,008 | 2,014,623 | 663,131 | |||||||||
| Net Asset Value, Redemption Price, and Offering Price Per Share | $ | 20.50 | ** | $ | 9.11 | ** | $ | 27.31 | ||||
| Institutional Class Shares | ||||||||||||
| Net assets | $ | 434,163,780 | $ | 64,388,940 | n/a | |||||||
| Shares outstanding (1,000,000,000 shares of $0.0001 par value authorized) | 21,152,356 | 6,973,013 | n/a | |||||||||
| Net Asset Value, Redemption Price, and Offering Price Per Share | $ | 20.53 | ** | $ | 9.23 | ** | n/a | |||||
** Redemption price may differ from NAV if redemption fee is applied.
| See Notes to the Financial Statements. | The Leuthold Funds - 2018 Annual Report | 27 |
| The Leuthold Funds |
| Statements of Assets and Liabilities (continued) |
| September 30, 2018 |
Leuthold Global Industries Fund | Grizzly Short Fund | |||||||
| ASSETS: | ||||||||
| Investments, at cost | $ | 9,568,025 | $ | 81,840,809 | ||||
| Investments, at fair value | 10,420,676 | 81,840,809 | ||||||
| Cash | — | — | ||||||
| Foreign currency (cost $27,183, and $0, respectively) | 27,158 | — | ||||||
| Receivable for Fund shares sold | 550 | 179,998 | ||||||
| Receivable for investments sold | 1,126,091 | — | ||||||
| Collateral at broker for securities sold short | — | 96,900,383 | ||||||
| Tri-party collateral held at custodian | — | 15,000,001 | ||||||
| Interest receivable | 149 | 125,060 | ||||||
| Dividends receivable | 36,219 | — | ||||||
| Receivable from Advisor | 8,049 | — | ||||||
| Other assets | 17,234 | 137,234 | ||||||
| Total Assets | 11,636,126 | 194,183,485 | ||||||
| LIABILITIES: | ||||||||
Securities sold short, at fair value (proceeds $0 and $98,232,054, respectively) | — | 94,949,790 | ||||||
| Payable for investments purchased | 1,132,904 | — | ||||||
| Payable for Fund shares redeemed | — | 12,347 | ||||||
| Payable to Adviser | — | 100,653 | ||||||
| Payable to Custodian | 17,776 | 3,802 | ||||||
| Payable to Directors | 538 | 5,346 | ||||||
| Dividends payable on securities sold short | — | 59,683 | ||||||
| Distribution (Rule 12b-1) fees payable | 4,315 | — | ||||||
| Shareholder servicing fees payable | — | 15,064 | ||||||
| Accrued expenses and other liablities | 40,836 | 88,043 | ||||||
| Total Liabilities | 1,196,369 | 95,234,728 | ||||||
| NET ASSETS | $ | 10,439,757 | $ | 98,948,757 | ||||
| 28 | The Leuthold Funds - 2018 Annual Report | See Notes to the Financial Statements. |
| The Leuthold Funds |
| Statements of Assets and Liabilities (continued) |
| September 30, 2018 |
Leuthold Global Industries Fund | Grizzly Short Fund | |||||||
| NET ASSETS CONSIST OF: | ||||||||
| Capital stock | $ | 8,581,697 | $ | 345,858,908 | ||||
| Total distributable earnings | 1,858,060 | (246,910,151 | ) | |||||
| Total Net Assets | $ | 10,439,757 | $ | 98,948,757 | ||||
| Retail Class Shares | ||||||||
| Net assets | $ | 1,798,973 | $ | 98,948,757 | ||||
| Shares outstanding (1,000,000,000 shares of $0.0001 par value authorized) | 106,480 | 5,606,226 | ||||||
| Net Asset Value, Redemption Price, and Offering Price Per Share | $ | 16.90 | * | $ | 17.65 | |||
| Institutional Class Shares | ||||||||
| Net assets | $ | 8,640,784 | n/a | |||||
| Shares outstanding (1,000,000,000 shares of $0.0001 par value authorized) | 507,644 | n/a | ||||||
| Net Asset Value, Redemption Price, and Offering Price Per Share | $ | 17.02 | * | n/a | ||||
* Redemption price may differ from NAV if redemption fee is applied.
| See Notes to the Financial Statements. | The Leuthold Funds - 2018 Annual Report | 29 |
| The Leuthold Funds |
| For the Year Ended September 30, 2018 |
Leuthold Core Investment Fund (Consolidated) | Leuthold Global Fund (Consolidated) | Leuthold Select Industries Fund | ||||||||||
| INVESTMENT INCOME: | ||||||||||||
| Dividend income (net of foreign taxes withheld of $203,161, $102,481, and $5,327 respectively) | $ | 8,743,673 | $ | 1,314,941 | $ | 280,012 | ||||||
| Interest income | 4,819,401 | 535,615 | 2,847 | |||||||||
| Income from securities lending, net | 569,102 | 115,946 | — | |||||||||
| Total investment income | 14,132,176 | 1,966,502 | 282,859 | |||||||||
| EXPENSES: | ||||||||||||
| Investment advisory fees (Note 3) | 7,760,732 | 870,449 | 191,086 | |||||||||
| Administration fees | 381,326 | 48,714 | 11,928 | |||||||||
| Transfer agent fees (Note 5) | 406,337 | 84,709 | 9,732 | |||||||||
| Legal fees | 61,522 | 15,556 | 846 | |||||||||
| Audit fees | 80,414 | 55,800 | 22,467 | |||||||||
| Fund accounting fees | 150,987 | 29,977 | 7,027 | |||||||||
| Custody fees | 150,727 | 78,432 | 17,714 | |||||||||
| Shareholder servicing fees - Retail Class (Note 5) | 465,162 | — | 21,950 | |||||||||
| Registration fees | 47,243 | 34,168 | 23,618 | |||||||||
| Report to shareholders | 99,182 | 10,619 | 3,147 | |||||||||
| Directors’ fees | 150,749 | 16,542 | 3,543 | |||||||||
| Distribution (Rule 12b-1) fees - Retail Class (Note 4) | — | 54,750 | — | |||||||||
| Other | 50,285 | 7,515 | 1,721 | |||||||||
| Total expenses before dividends and interest on securities sold short and reimbursement from Adviser | 9,804,666 | 1,307,231 | 314,779 | |||||||||
| Dividends and interest on securities sold short | 1,618,670 | 202,486 | — | |||||||||
| Reimbursement from Adviser (Note 3) | — | — | (28,151 | ) | ||||||||
| Total expenses | 11,423,336 | 1,509,717 | 286,628 | |||||||||
| NET INVESTMENT INCOME (LOSS) | 2,708,840 | 456,785 | (3,769 | ) | ||||||||
| 30 | The Leuthold Funds - 2018 Annual Report | See Notes to the Financial Statements. |
| The Leuthold Funds |
| Statements of Operations (continued) |
| For the Year Ended September 30, 2018 |
Leuthold Core Investment Fund (Consolidated) | Leuthold Global Fund (Consolidated) | Leuthold Select Industries Fund | ||||||||||
| REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS, INVESTMENT COMPANIES, SECURITIES SOLD SHORT, AND FOREIGN CURRENCY AND FOREIGN CURRENCY TRANSLATION: | ||||||||||||
| Net realized gain (loss) on: | ||||||||||||
| Unaffiliated investments | $ | 101,520,475 | $ | 8,195,370 | $ | 1,713,475 | ||||||
| Investment companies | 1,688,710 | 215,609 | — | |||||||||
| Realized gain distributions from investment companies | 13,006 | — | — | |||||||||
| Securities sold short | (17,787,037 | ) | (1,271,901 | ) | — | |||||||
| Foreign currency and foreign currency translation | (809,780 | ) | (124,598 | ) | (72 | ) | ||||||
| Net unrealized appreciation (depreciation) during the period on: | ||||||||||||
| Unaffiliated investments | (59,780,155 | ) | (7,195,469 | ) | (242,617 | ) | ||||||
| Affiliated investments | (626,180 | ) | — | — | ||||||||
| Investment companies | (3,503,883 | ) | (386,250 | ) | — | |||||||
| Securities sold short | 2,749,947 | 425,573 | — | |||||||||
| Foreign currency and foreign currency translation | 1,632,915 | (472,167 | ) | 3 | ||||||||
| Net realized and unrealized gain (loss) on investments, investment companies, securities sold short, and foreign currency and foreign currency translation | 25,098,018 | (613,833 | ) | 1,470,789 | ||||||||
| NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM OPERATIONS | $ | 27,806,858 | $ | (157,048 | ) | $ | 1,467,020 | |||||
| See Notes to the Financial Statements. | The Leuthold Funds - 2018 Annual Report | 31 |
| The Leuthold Funds |
| Statements of Operations (continued) |
| For the Year Ended September 30, 2018 |
Leuthold Global Industries Fund | Grizzly Short Fund | |||||||
| INVESTMENT INCOME: | ||||||||
| Dividend income (net of foreign taxes withheld of $18,928 and $0, respectively) | $ | 236,632 | $ | 3,805 | ||||
| Interest income | 1,596 | 3,470,988 | ||||||
| Total investment income | 238,228 | 3,474,793 | ||||||
| EXPENSES: | ||||||||
| Investment advisory fees (Note 3) | 109,612 | 2,066,552 | ||||||
| Administration fees | 10,391 | 73,458 | ||||||
| Transfer agent fees (Note 5) | 19,710 | 55,331 | ||||||
| Legal fees | 3,692 | 13,719 | ||||||
| Audit fees | 22,391 | 22,391 | ||||||
| Fund accounting fees | 11,784 | 27,220 | ||||||
| Custody fees | 38,719 | 10,204 | ||||||
| Shareholder servicing fees - Retail Class (Note 5) | — | 171,616 | ||||||
| Registration fees | 36,752 | 32,141 | ||||||
| Report to shareholders | 1,052 | 25,474 | ||||||
| Directors’ fees | 1,954 | 27,123 | ||||||
| Distribution (Rule 12b-1) fees - Retail Class (Note 4) | 5,034 | — | ||||||
| Other | 2,045 | 12,336 | ||||||
| Total expenses before dividends and interest on securities sold short and reimbursement from Adviser | 263,136 | 2,537,565 | ||||||
| Dividends and interest on securities sold short | — | 1,831,337 | ||||||
| Reimbursement from Adviser (Note 3) | (121,088 | ) | — | |||||
| Total expenses | 142,048 | 4,368,902 | ||||||
| NET INVESTMENT INCOME (LOSS) | $ | 96,180 | $ | (894,109 | ) | |||
| 32 | The Leuthold Funds - 2018 Annual Report | See Notes to the Financial Statements. |
| The Leuthold Funds |
| Statements of Operations (continued) |
| For the Year Ended September 30, 2018 |
Leuthold Global Industries Fund | Grizzly Short Fund | |||||||
| REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS, INVESTMENT COMPANIES, SECURITIES SOLD SHORT, AND FOREIGN CURRENCY AND FOREIGN CURRENCY TRANSLATION: | ||||||||
| Net realized gain (loss) on: | ||||||||
| Investments | $ | 1,002,895 | $ | — | ||||
| Investment companies | 24,675 | — | ||||||
| Securities sold short | — | (35,514,168 | ) | |||||
| Foreign currency and foreign currency translation | (3,664 | ) | — | |||||
| Net unrealized appreciation (depreciation) during the period on: | ||||||||
| Investments | (867,450 | ) | — | |||||
| Investment companies | (6,794 | ) | — | |||||
| Securities sold short | — | 2,114,602 | ||||||
| Foreign currency and foreign currency translation | (102,111 | ) | — | |||||
| Net realized and unrealized gain (loss) on investments, investment companies, securities sold short, and foreign currency and foreign currency translation | 47,551 | (33,399,566 | ) | |||||
| NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM OPERATIONS | $ | 143,731 | $ | (34,293,675 | ) | |||
| See Notes to the Financial Statements. | The Leuthold Funds - 2018 Annual Report | 33 |
| Leuthold Core Investment Fund |
Year Ended September 30, 2018 (Consolidated) | Year Ended September 30, 2017 (Consolidated) | |||||||
| OPERATIONS: | ||||||||
| Net investment income | $ | 2,708,840 | $ | 2,042,175 | ||||
| Net realized gain on investments, investment companies, securities sold short, and foreign currency and foreign currency translation | 84,625,374 | 34,676,117 | ||||||
| Net unrealized appreciation (depreciation) on investments, investment companies, securities sold short, and foreign currency and foreign currency translation | (59,527,356 | ) | 74,483,445 | |||||
| Net increase in net assets from operations | 27,806,858 | 111,201,737 | ||||||
| DISTRIBUTIONS TO SHAREHOLDERS: | ||||||||
| Distributions - Retail Class | (15,722,617 | )(1) | (2,558,952 | ) | ||||
| Distributions - Institutional Class | (13,500,115 | )(2) | ( 2,118,972 | ) | ||||
| Total distributions | (29,222,732 | ) | (4,677,924 | ) | ||||
| CAPITAL SHARE TRANSACTIONS: | ||||||||
| Proceeds from shares sold - Retail Class | 49,574,688 | 47,009,722 | ||||||
| Proceeds from shares sold - Institutional Class | 99,394,031 | 74,784,361 | ||||||
| Proceeds from shares issued to holders in reinvestment of dividends - Retail Class | 14,973,202 | 2,441,849 | ||||||
| Proceeds from shares issued to holders in reinvestment of dividends - Institutional Class | 11,741,082 | 1,831,572 | ||||||
| Cost of shares redeemed - Retail Class* | (125,626,684 | ) | (171,719,259 | ) | ||||
| Cost of shares redeemed - Institutional Class** | (61,432,479 | ) | (114,514,807 | ) | ||||
| Net decrease in net assets from capital share transactions | (11,376,160 | ) | (160,166,562 | ) | ||||
| TOTAL DECREASE IN NET ASSETS: | (12,792,034 | ) | (53,642,749 | ) | ||||
| NET ASSETS | ||||||||
| Beginning of year | 850,051,270 | 903,694,019 | ||||||
End of year(3) | $ | 837,259,236 | $ | 850,051,270 | ||||
| CHANGES IN SHARES OUTSTANDING: | ||||||||
| Shares sold - Retail Class | 2,391,128 | 2,470,375 | ||||||
| Shares sold - Institutional Class | 4,806,861 | 3,863,613 | ||||||
| Shares issued to holders in reinvestment of dividends - Retail Class | 734,892 | 134,342 | ||||||
| Shares issued to holders in reinvestment of dividends - Institutional Class | 575,096 | 99,015 | ||||||
| Shares redeemed - Retail Class | (6,082,213 | ) | (9,045,976 | ) | ||||
| Shares redeemed - Institutional Class | (2,972,534 | ) | (6,185,014 | ) | ||||
| Net decrease in shares outstanding | (546,770 | ) | (8,663,645 | ) | ||||
| * Net of redemption fees of (Retail Class): | $ | 299 | $ | 440 | ||||
| ** Net of redemption fees of (Institutional Class): | $ | 262 | $ | 105 | ||||
| (1) | Includes net investment income distributions of $994,349 and net realized gain distributions of $14,728,268. |
| (2) | Includes net investment income distributions of $1,280,447 and net realized gain distributions of $12,219,668. |
| (3) | Including accumulated net investment income (loss) of $(253,927) and $1,613, respectively. |
| 34 | The Leuthold Funds - 2018 Annual Report | See Notes to the Financial Statements. |
| Leuthold Global Fund |
| Statements of Changes in Net Assets |
Year Ended September 30, 2018 (Consolidated) | Year Ended September 30, 2017 (Consolidated) | |||||||
| OPERATIONS: | ||||||||
| Net investment income | $ | 456,785 | $ | 617,980 | ||||
| Net realized gain on investments, investment companies, securities sold short, and foreign currency and foreign currency translation | 7,014,480 | 8,856,902 | ||||||
| Net unrealized appreciation (depreciation) on investments, investment companies, securities sold short, and foreign currency and foreign currency translation | (7,628,313 | ) | 2,276,979 | |||||
| Net increase (decrease) in net assets from operations | (157,048 | ) | 11,751,861 | |||||
| DISTRIBUTIONS TO SHAREHOLDERS: | ||||||||
| Distributions - Retail Class | (2,138,468 | )(1) | (3,355,947 | ) | ||||
| Distributions - Institutional Class | (6,753,470 | )(2) | (8,432,637 | ) | ||||
| Total distributions | (8,891,938 | ) | (11,788,584 | ) | ||||
| CAPITAL SHARE TRANSACTIONS: | ||||||||
| Proceeds from shares sold - Retail Class | 2,028,207 | 4,096,510 | ||||||
| Proceeds from shares sold - Institutional Class | 15,052,597 | 8,483,230 | ||||||
| Proceeds from shares issued to holders in reinvestment of dividends - Retail Class | 2,063,968 | 2,988,956 | ||||||
| Proceeds from shares issued to holders in reinvestment of dividends - Institutional Class | 6,015,022 | 7,307,081 | ||||||
| Cost of shares redeemed - Retail Class* | (7,608,038 | ) | (60,927,741 | ) | ||||
| Cost of shares redeemed - Institutional Class** | (28,405,896 | ) | (41,921,745 | ) | ||||
| Net decrease in net assets from capital share transactions | (10,854,140 | ) | (79,973,709 | ) | ||||
| TOTAL DECREASE IN NET ASSETS: | (19,903,126 | ) | (80,010,432 | ) | ||||
| NET ASSETS | ||||||||
| Beginning of year | 102,654,284 | 182,664,716 | ||||||
End of year(3) | $ | 82,751,158 | $ | 102,654,284 | ||||
| CHANGES IN SHARES OUTSTANDING: | ||||||||
| Shares sold - Retail Class | 211,107 | 439,767 | ||||||
| Shares sold - Institutional Class | 1,553,258 | 895,830 | ||||||
| Shares issued to holders in reinvestment of dividends - Retail Class | 219,621 | 341,205 | ||||||
| Shares issued to holders in reinvestment of dividends - Institutional Class | 632,740 | 824,956 | ||||||
| Shares redeemed - Retail Class | (807,863 | ) | (6,375,412 | ) | ||||
| Shares redeemed - Institutional Class | (2,952,591 | ) | (4,426,522 | ) | ||||
| Net decrease in shares outstanding | (1,143,728 | ) | (8,300,176 | ) | ||||
| * Net of redemption fees of (Retail Class): | $ | 205 | $ | 289 | ||||
| ** Net of redemption fees of (Institutional Class): | $ | 2 | $ | 2,022 | ||||
| (1) | Includes net investment income distributions of $40,766 and net realized gain distributions of $2,097,702. |
| (2) | Includes net investment income distributions of $223,632 and net realized gain distributions of $6,529,838. |
| (3) | Including accumulated net investment income of $9,798 and $19,636, respectively. |
| See Notes to the Financial Statements. | The Leuthold Funds - 2018 Annual Report | 35 |
| Leuthold Select Industries Fund |
| Statements of Changes in Net Assets |
Year Ended September 30, 2018 | Year Ended September 30, 2017 | |||||||
| OPERATIONS: | ||||||||
| Net investment loss | $ | (3,769 | ) | $ | (11,542 | ) | ||
| Net realized gain on investments | 1,713,403 | 1,184,413 | ||||||
| Net unrealized appreciation (depreciation) on investments | (242,614 | ) | 1,625,084 | |||||
| Net increase in net assets from operations | 1,467,020 | 2,797,955 | ||||||
| DISTRIBUTIONS TO SHAREHOLDERS: | ||||||||
| Distributions - Retail Class | (741,441 | )(1) | — | |||||
| Total distributions | (741,441 | ) | — | |||||
| CAPITAL SHARE TRANSACTIONS: | ||||||||
| Proceeds from shares sold | 11,024,392 | 3,207,231 | ||||||
| Proceeds from shares issued to holders in reinvestment of dividends | 712,871 | — | ||||||
| Cost of shares redeemed | (9,396,776 | ) | (3,590,211 | ) | ||||
| Net increase (decrease) in net assets from capital share transactions | 2,340,487 | (382,980 | ) | |||||
| TOTAL INCREASE IN NET ASSETS: | 3,066,066 | 2,414,975 | ||||||
| NET ASSETS | ||||||||
| Beginning of year | 15,045,866 | 12,630,891 | ||||||
End of year(2) | $ | 18,111,932 | $ | 15,045,866 | ||||
| CHANGES IN SHARES OUTSTANDING: | ||||||||
| Shares sold | 412,330 | 134,033 | ||||||
| Shares issued to holders in reinvestment of dividends | 27,474 | — | ||||||
| Shares redeemed | (348,325 | ) | (152,339 | ) | ||||
| Net increase (decrease) in shares outstanding | 91,479 | (18,306 | ) | |||||
| (1) | Includes net investment income distributions of $5,625 and net realized gain distributions of $735,816. |
| (2) | Including accumulated net investment loss of $(24,117) and $(14,651), respectively. |
| 36 | The Leuthold Funds - 2018 Annual Report | See Notes to the Financial Statements. |
| Leuthold Global Industries Fund |
| Statements of Changes in Net Assets |
Year Ended September 30, 2018 | Year Ended September 30, 2017 | |||||||
| OPERATIONS: | ||||||||
| Net investment income | $ | 96,180 | $ | 98,988 | ||||
| Net realized gain on investments, investment companies, and foreign currency and foreign currency translation | 1,023,906 | 955,551 | ||||||
| Net unrealized appreciation (depreciation) on investments, investment companies, and foreign currency and foreign currency translation | (976,355 | ) | 945,616 | |||||
| Net increase in net assets from operations | 143,731 | 2,000,155 | ||||||
| DISTRIBUTIONS TO SHAREHOLDERS: | ||||||||
| Distributions - Retail Class | (158,928 | )(1) | (74,190 | ) | ||||
| Distributions - Institutional Class | (727,913 | )(2) | (389,253 | ) | ||||
| Total distributions | (886,841 | ) | (463,443 | ) | ||||
| CAPITAL SHARE TRANSACTIONS: | ||||||||
| Proceeds from shares sold - Retail Class | 199,182 | 131,335 | ||||||
| Proceeds from shares sold - Institutional Class | 2,578,836 | 1,183,211 | ||||||
| Proceeds from shares issued to holders in reinvestment of dividends - Retail Class | 155,751 | 72,780 | ||||||
| Proceeds from shares issued to holders in reinvestment of dividends - Institutional Class | 706,923 | 374,587 | ||||||
| Cost of shares redeemed - Retail Class* | (375,877 | ) | (357,409 | ) | ||||
| Cost of shares redeemed - Institutional Class | (3,015,381 | ) | (3,643,282 | ) | ||||
| Net increase (decrease) in net assets from capital share transactions | 249,434 | (2,238,778 | ) | |||||
| TOTAL DECREASE IN NET ASSETS: | (493,676 | ) | (702,066 | ) | ||||
| NET ASSETS | ||||||||
| Beginning of year | 10,933,433 | 11,635,499 | ||||||
End of year(3) | $ | 10,439,757 | $ | 10,933,433 | ||||
| CHANGES IN SHARES OUTSTANDING: | ||||||||
| Shares sold - Retail Class | 11,384 | 8,038 | ||||||
| Shares sold - Institutional Class | 143,418 | 72,895 | ||||||
| Shares issued to holders in reinvestment of dividends - Retail Class | 8,884 | 4,869 | ||||||
| Shares issued to holders in reinvestment of dividends - Institutional Class | 40,111 | 24,828 | ||||||
| Shares redeemed - Retail Class | (21,491 | ) | (22,437 | ) | ||||
| Shares redeemed - Institutional Class | (168,743 | ) | (229,142 | ) | ||||
| Net increase (decrease) in shares outstanding | 13,563 | (140,949 | ) | |||||
| * Net of redemption fees of (Retail Class): | $ | 3 | $ | — | ||||
| (1) | Includes net investment income distributions of $19,880 and net realized gain distributions of $139,048. |
| (2) | Includes net investment income distributions of $76,679 and net realized gain distributions of $651,234. |
| (3) | Including accumulated net investment income of $94,340 and $84,921, respectively. |
| See Notes to the Financial Statements. | The Leuthold Funds - 2018 Annual Report | 37 |
| Grizzly Short Fund |
| Statements of Changes in Net Assets |
Year Ended September 30, 2018 | Year Ended September 30, 2017 | |||||||
| OPERATIONS: | ||||||||
| Net investment loss | $ | (894,109 | ) | $ | (3,377,479 | ) | ||
| Net realized loss on securities sold short and foreign currency and foreign currency translation | (35,514,168 | ) | (28,568,686 | ) | ||||
| Net unrealized appreciation on securities sold short and foreign currency and foreign currency translation | 2,114,602 | 4,861,667 | ||||||
| Net decrease in net assets from operations | (34,293,675 | ) | (27,084,498 | ) | ||||
| DISTRIBUTIONS TO SHAREHOLDERS: | ||||||||
| Distributions - Retail Class | — | — | ||||||
| Total distributions | — | — | ||||||
| CAPITAL SHARE TRANSACTIONS: | ||||||||
| Proceeds from shares sold | 136,445,760 | 224,754,923 | ||||||
| Cost of shares redeemed | (208,901,601 | ) | (170,183,996 | ) | ||||
| Net increase (decrease) in net assets from capital share transactions | (72,455,841 | ) | 54,570,927 | |||||
| TOTAL INCREASE (DECREASE) IN NET ASSETS: | (106,749,516 | ) | 27,486,429 | |||||
| NET ASSETS | ||||||||
| Beginning of year | 205,698,273 | 178,211,844 | ||||||
End of year(1) | $ | 98,948,757 | $ | 205,698,273 | ||||
| CHANGES IN SHARES OUTSTANDING: | ||||||||
| Shares sold | 24,912,796 | 37,475,246 | ||||||
| Shares redeemed | (57,577,260 | ) | (28,097,409 | ) | ||||
| Net increase (decrease) in shares outstanding | (32,664,464 | ) | 9,377,837 | |||||
| (1) | Including accumulated net investment loss of $(270,968) and $(2,164,686), respectively. |
| 38 | The Leuthold Funds - 2018 Annual Report | See Notes to the Financial Statements. |
Leuthold Core Investment Fund - Retail - LCORX
Year Ended September 30, 2018 (Consolidated) | Year Ended September 30, 2017 (Consolidated) | Year Ended September 30, 2016 (Consolidated) | Year Ended September 30, 2015 (Consolidated) | Year Ended September 30, 2014 (Consolidated) | ||||||||||||||||
Per Share Data(1): | ||||||||||||||||||||
| Net asset value, beginning of year | $ | 20.54 | $ | 18.06 | $ | 18.44 | $ | 18.85 | $ | 18.29 | ||||||||||
| Income (loss) from investment operations: | ||||||||||||||||||||
Net investment income (loss) (2) | 0.05 | 0.04 | (0.01 | ) | (0.01 | ) | 0.01 | |||||||||||||
| Net realized and unrealized gain on investments and securities sold short | 0.61 | 2.53 | 0.32 | 0.76 | 2.02 | |||||||||||||||
| Total from investment operations | 0.66 | 2.57 | 0.31 | 0.75 | 2.03 | |||||||||||||||
| Less distributions: | ||||||||||||||||||||
| From net investment income | (0.05 | ) | (0.01 | ) | — | (0.03 | ) | (0.21 | ) | |||||||||||
| From net realized gain | (0.65 | ) | (0.08 | ) | (0.69 | ) | (1.13 | ) | (1.26 | ) | ||||||||||
Redemption fees(3) | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | |||||||||||||||
| Total distributions | (0.70 | ) | (0.09 | ) | (0.69 | ) | (1.16 | ) | (1.47 | ) | ||||||||||
| Net asset value, end of year | $ | 20.50 | $ | 20.54 | $ | 18.06 | $ | 18.44 | $ | 18.85 | ||||||||||
| Total Return | 3.23 | % | 14.31 | % | 1.76 | % | 4.03 | % | 11.49 | % | ||||||||||
| Supplemental data and ratios: | ||||||||||||||||||||
| Net assets, end of year | $ | 403,095,456 | $ | 464,660,913 | $ | 524,731,192 | $ | 564,608,599 | $ | 569,237,299 | ||||||||||
Ratio of expenses to average net assets (4) | 1.38 | % | 1.21 | % | 1.29 | % | 1.30 | % | 1.28 | % | ||||||||||
Ratio of net investment income (loss) to average net assets (5) | 0.26 | % | 0.20 | % | (0.08 | )% | (0.05 | )% | 0.04 | % | ||||||||||
Portfolio turnover rate (6) | 79.00 | % | 52.36 | % | 109.32 | % | 78.96 | % | 80.65 | % | ||||||||||
| (1) | For a share outstanding throughout the period. Rounded to the nearest cent. |
| (2) | Net investment income (loss) per share is calculated based on average shares outstanding. |
| (3) | Amount represents less than $0.005 per share. |
| (4) | The ratio of expenses to average net assets includes dividends and interest on securities sold short. The expense ratios excluding dividends and interest on securities sold short were 1.19% for the year ended September 30, 2018, 1.19% for the year ended September 30, 2017, 1.17% for the year ended September 30, 2016, 1.16% for the year ended September 30, 2015, and 1.15% for the year ended September 30, 2014. |
| (5) | The net investment income ratios include dividends and interest on securities sold short. |
| (6) | The portfolio turnover rate excludes purchases and sales of securities sold short. |
| See Notes to the Financial Statements. | The Leuthold Funds - 2018 Annual Report | 39 |
Leuthold Core Investment Fund - Institutional - LCRIX
Financial Highlights
Y ear Ended September 30, 2018 (Consolidated) | Year Ended September 30, 2017 (Consolidated) | Year Ended September 30, 2016 (Consolidated) | Year Ended September 30, 2015 (Consolidated) | Year Ended September 30, 2014 (Consolidated) | ||||||||||||||||
Per Share Data(1): | ||||||||||||||||||||
| Net asset value, beginning of year | $ | 20.56 | $ | 18.08 | $ | 18.43 | $ | 18.85 | $ | 18.28 | ||||||||||
| Income from investment operations: | ||||||||||||||||||||
Net investment income (2) | 0.08 | 0.06 | 0.01 | 0.01 | 0.03 | |||||||||||||||
| Net realized and unrealized gain on investments and securities sold short | 0.60 | 2.53 | 0.33 | 0.74 | 2.03 | |||||||||||||||
| Total from investment operations | 0.68 | 2.59 | 0.34 | 0.75 | 2.06 | |||||||||||||||
| Less distributions: | ||||||||||||||||||||
| From net investment income | (0.06 | ) | (0.03 | ) | — | (0.04 | ) | (0.23 | ) | |||||||||||
| From net realized gain | (0.65 | ) | (0.08 | ) | (0.69 | ) | (1.13 | ) | (1.26 | ) | ||||||||||
| Redemption fees | 0.00 | (3) | 0.00 | (3) | 0.00 | (3) | 0.00 | (3) | — | |||||||||||
| Total distributions | (0.71 | ) | (0.11 | ) | (0.69 | ) | (1.17 | ) | (1.49 | ) | ||||||||||
| Net asset value, end of year | $ | 20.53 | $ | 20.56 | $ | 18.08 | $ | 18.43 | $ | 18.85 | ||||||||||
| Total Return | 3.35 | % | 14.43 | % | 1.93 | % | 4.03 | % | 11.66 | % | ||||||||||
| Supplemental data and ratios: | ||||||||||||||||||||
| Net assets, end of year | $ | 434,163,780 | $ | 385,390,357 | $ | 378,962,827 | $ | 293,666,347 | $ | 276,568,913 | ||||||||||
Ratio of expenses to average net assets (4) | 1.27 | % | 1.10 | % | 1.17 | % | 1.20 | % | 1.18 | % | ||||||||||
Ratio of net investment income to average net assets (5) | 0.37 | % | 0.30 | % | 0.04 | % | 0.05 | % | 0.14 | % | ||||||||||
Portfolio turnover rate (6) | 79.00 | % | 52.36 | % | 109.32 | % | 78.96 | % | 80.65 | % | ||||||||||
| (1) | For a share outstanding throughout the period. Rounded to the nearest cent. |
| (2) | Net investment income per share is calculated based on average shares outstanding. |
| (3) | Amount represents less than $0.005 per share. |
| (4) | The ratio of expenses to average net assets includes dividends and interest on securities sold short. The expense ratios excluding dividends and interest on securities sold short were 1.08% for the year ended September 30, 2018, 1.08% for the year ended September 30, 2017, 1.05% for the year ended September 30, 2016, 1.06% for the year ended September 30, 2015, and 1.06% for the year ended September 30, 2014. |
| (5) | The net investment income ratios include dividends and interest on securities sold short. |
| (6) | The portfolio turnover rate excludes purchases and sales of securities sold short. |
| 40 | The Leuthold Funds - 2018 Annual Report | See Notes to the Financial Statements. |
Leuthold Global Fund - Retail - GLBLX
Financial Highlights
| Year Ended September 30, 2018 (Consolidated) | Year Ended September 30, 2017 (Consolidated) | Year Ended September 30, 2016 (Consolidated) | Year Ended September 30, 2015 (Consolidated) | Year Ended September 30, 2014 (Consolidated) | ||||||||||||||||
Per Share Data(1): | ||||||||||||||||||||
| Net asset value, beginning of year | $ | 10.05 | $ | 9.86 | $ | 10.03 | $ | 11.29 | $ | 11.65 | ||||||||||
| Income (loss) from investment operations: | ||||||||||||||||||||
Net investment income (loss) (2) | 0.03 | 0.04 | (0.01 | ) | (0.03 | ) | 0.03 | |||||||||||||
| Net realized and unrealized gain (loss) on investments and securities sold short | (0.07 | ) | 1.02 | 0.21 | (0.11 | ) | 0.83 | |||||||||||||
| Total from investment operations | (0.04 | ) | 1.06 | 0.20 | (0.14 | ) | 0.86 | |||||||||||||
| Less distributions: | ||||||||||||||||||||
| From net investment income | (0.02 | ) | — | — | (0.03 | ) | (0.08 | ) | ||||||||||||
| From net realized gain | (0.88 | ) | (0.87 | ) | (0.37 | ) | (1.09 | ) | (1.14 | ) | ||||||||||
Redemption fees(3) | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | |||||||||||||||
| Total distributions | (0.90 | ) | (0.87 | ) | (0.37 | ) | (1.12 | ) | (1.22 | ) | ||||||||||
| Net asset value, end of year | $ | 9.11 | $ | 10.05 | $ | 9.86 | $ | 10.03 | $ | 11.29 | ||||||||||
| Total Return | (0.67 | )% | 12.02 | % | 1.89 | % | (1.41 | )% | 7.68 | % | ||||||||||
| Supplemental data and ratios: | ||||||||||||||||||||
| Net assets, end of year | $ | 18,362,218 | $ | 24,040,140 | $ | 78,743,516 | $ | 95,026,857 | $ | 130,838,148 | ||||||||||
Ratio of expenses to average net assets (4) | 1.75 | % | 1.56 | % | 1.82 | % | 1.71 | % | 1.65 | % | ||||||||||
Ratio of net investment income (loss) to average net assets (5) | 0.28 | % | 0.38 | % | (0.15 | )% | (0.29 | )% | 0.25 | % | ||||||||||
Portfolio turnover rate (6) | 79.09 | % | 63.13 | % | 102.93 | % | 78.37 | % | 71.63 | % | ||||||||||
| (1) | For a share outstanding throughout the period. Rounded to the nearest cent. |
| (2) | Net investment income (loss) per share is calculated based on average shares outstanding. |
| (3) | Amount represents less than $0.005 per share. |
| (4) | The ratio of expenses to average net assets includes dividends and interest on securities sold short. The expense ratios excluding dividends and interest on securities sold short were 1.54% for the year ended September 30, 2018, 1.56% for the year ended September 30, 2017, 1.61% for the year ended September 30, 2016, 1.54% for the year ended September 30, 2015, and 1.53% for the year ended September 30, 2014. |
| (5) | The net investment income ratios include dividends and interest on securities sold short. |
| (6) | The portfolio turnover rate excludes purchases and sales of securities sold short. |
| See Notes to the Financial Statements. | The Leuthold Funds - 2018 Annual Report | 41 |
Leuthold Global Fund - Institutional - GLBIX
Financial Highlights
| Year Ended September 30, 2018 (Consolidated) | Year Ended September 30, 2017 (Consolidated) | Year Ended September 30, 2016 (Consolidated) | Year Ended September 30, 2015 (Consolidated) | Year Ended September 30, 2014 (Consolidated) | ||||||||||||||||
Per Share Data(1): | ||||||||||||||||||||
| Net asset value, beginning of year | $ | 10.16 | $ | 9.95 | $ | 10.10 | $ | 11.34 | $ | 11.69 | ||||||||||
| Income (loss) from investment operations: | ||||||||||||||||||||
Net investment income (loss) (2) | 0.05 | 0.06 | 0.01 | (0.01 | ) | 0.05 | ||||||||||||||
| Net realized and unrealized gain (loss) on investments and securities sold short | (0.07 | ) | 1.03 | 0.21 | (0.11 | ) | 0.84 | |||||||||||||
| Total from investment operations | (0.02 | ) | 1.09 | 0.22 | (0.12 | ) | 0.89 | |||||||||||||
| Less distributions: | ||||||||||||||||||||
| From net investment income | (0.03 | ) | (0.01 | ) | — | (0.03 | ) | (0.10 | ) | |||||||||||
| From net realized gain | (0.88 | ) | (0.87 | ) | (0.37 | ) | (1.09 | ) | (1.14 | ) | ||||||||||
| Redemption fees | 0.00 | (3) | 0.00 | (3) | 0.00 | (3) | 0.00 | (3) | — | |||||||||||
| Total distributions | (0.91 | ) | (0.88 | ) | (0.37 | ) | (1.12 | ) | (1.24 | ) | ||||||||||
| Net asset value, end of year | $ | 9.23 | $ | 10.16 | $ | 9.95 | $ | 10.10 | $ | 11.34 | ||||||||||
| Total Return | (0.43 | )% | 12.28 | % | 2.18 | % | (1.30 | )% | 7.95 | % | ||||||||||
| Supplemental data and ratios: | ||||||||||||||||||||
| Net assets, end of year | $ | 64,388,940 | $ | 78,614,144 | $ | 103,921,200 | $ | 218,497,272 | $ | 231,615,536 | ||||||||||
Ratio of expenses to average net assets (4) | 1.50 | % | 1.36 | % | 1.57 | % | 1.50 | % | 1.44 | % | ||||||||||
Ratio of net investment income (loss) to average net assets (5) | 0.53 | % | 0.58 | % | 0.10 | % | (0.09 | )% | 0.45 | % | ||||||||||
Portfolio turnover rate (6) | 79.09 | % | 63.13 | % | 102.93 | % | 78.37 | % | 71.63 | % | ||||||||||
| (1) | For a share outstanding throughout the period. Rounded to the nearest cent. |
| (2) | Net investment income (loss) per share is calculated based on average shares outstanding. |
| (3) | Amount represents less than $0.005 per share. |
| (4) | The ratio of expenses to average net assets includes dividends and interest on securities sold short. The expense ratios excluding dividends and interest on securities sold short were 1.29% for the year ended September 30, 2018, 1.36% for the year ended September 30, 2017, 1.36% for the year ended September 30, 2016, 1.33% for the year ended September 30, 2015, and 1.33% for the year ended September 30, 2014. |
| (5) | The net investment income ratios include dividends and interest on securities sold short. |
| (6) | The portfolio turnover rate excludes purchases and sales of securities sold short. |
| 42 | The Leuthold Funds - 2018 Annual Report | See Notes to the Financial Statements. |
Leuthold Select Industries Fund - LSLTX
Financial Highlights
| Year Ended September 30, 2018 | Year Ended September 30, 2017 | Year Ended September 30, 2016 | Year Ended September 30, 2015 | Year Ended September 30, 2014 | ||||||||||||||||
Per Share Data(1): | ||||||||||||||||||||
| Net asset value, beginning of year | $ | 26.32 | $ | 21.41 | $ | 21.27 | $ | 20.02 | $ | 16.82 | ||||||||||
| Income (loss) from investment operations: | ||||||||||||||||||||
Net investment loss(2) | (0.01 | ) | (0.02 | ) | (0.00 | )(3) | (0.03 | ) | (0.07 | ) | ||||||||||
| Net realized and unrealized gain on investments | 2.28 | 4.93 | 0.45 | 1.28 | 3.27 | |||||||||||||||
| Total from investment operations | 2.27 | 4.91 | 0.45 | 1.25 | 3.20 | |||||||||||||||
| Less distributions: | ||||||||||||||||||||
| From net investment income | (0.01 | ) | — | (0.03 | ) | — | — | |||||||||||||
| From net realized gain | (1.27 | ) | — | (0.28 | ) | — | — | |||||||||||||
| Total distributions | (1.28 | ) | — | (0.31 | ) | — | — | |||||||||||||
| Net asset value, end of year | $ | 27.31 | $ | 26.32 | $ | 21.41 | $ | 21.27 | $ | 20.02 | ||||||||||
| Total Return | 8.89 | % | 22.93 | % | 2.09 | % | 6.24 | % | 19.02 | % | ||||||||||
| Supplemental data and ratios: | ||||||||||||||||||||
| Net assets, end of year | $ | 18,111,932 | $ | 15,045,866 | $ | 12,630,891 | $ | 12,624,145 | $ | 14,977,451 | ||||||||||
| Ratio of expenses to average net assets: | ||||||||||||||||||||
| Before expense reimbursement or recovery | 1.65 | % | 1.80 | % | 1.72 | % | 1.73 | % | 1.68 | % | ||||||||||
| After expense reimbursement or recovery | 1.50 | % | 1.50 | % | 1.50 | % | 1.50 | % | 1.58 | % | ||||||||||
| Ratio of net investment income (loss) to average net assets: | ||||||||||||||||||||
| Before expense reimbursement or recovery | (0.17 | )% | (0.39 | )% | (0.20 | )% | (0.35 | )% | (0.44 | )% | ||||||||||
| After expense reimbursement or recovery | (0.02 | )% | (0.09 | )% | 0.02 | % | (0.12 | )% | (0.34 | )% | ||||||||||
| Portfolio turnover rate | 104.00 | % | 62.72 | % | 118.26 | % | 77.42 | % | 66.79 | % | ||||||||||
| (1) | For a share outstanding throughout the period. Rounded to the nearest cent. |
| (2) | Net investment loss per share is calculated based on average shares outstanding. |
| (3) | Amount represents less than $0.005 per share. |
| See Notes to the Financial Statements. | The Leuthold Funds - 2018 Annual Report | 43 |
Leuthold Global Industries Fund - Retail - LGINX
Financial Highlights
| Year Ended September 30, 2018 | Year Ended September 30, 2017 | Year Ended September 30, 2016 | Year Ended September 30, 2015 | Year Ended September 30, 2014 | ||||||||||||||||
Per Share Data(1): | ||||||||||||||||||||
| Net asset value, beginning of year | $ | 18.13 | $ | 15.64 | $ | 15.76 | $ | 16.54 | $ | 14.89 | ||||||||||
| Income (loss) from investment operations: | ||||||||||||||||||||
Net investment income (2) | 0.12 | 0.12 | 0.12 | 0.04 | 0.08 | |||||||||||||||
| Net realized and unrealized gain (loss) on investments | 0.09 | 3.01 | 0.41 | (0.46 | ) | 1.68 | ||||||||||||||
| Total from investment operations | 0.21 | 3.13 | 0.53 | (0.42 | ) | 1.76 | ||||||||||||||
| Less distributions: | ||||||||||||||||||||
| From net investment income | (0.17 | ) | (0.07 | ) | (0.07 | ) | (0.05 | ) | (0.11 | ) | ||||||||||
| From net realized gain | (1.27 | ) | (0.57 | ) | (0.58 | ) | (0.31 | ) | — | |||||||||||
| Redemption fees | 0.00 | (3) | — | — | 0.00 | (3) | 0.00 | (3) | ||||||||||||
| Total distributions | (1.44 | ) | (0.64 | ) | (0.65 | ) | (0.36 | ) | (0.11 | ) | ||||||||||
| Net asset value, end of year | $ | 16.90 | $ | 18.13 | $ | 15.64 | $ | 15.76 | $ | 16.54 | ||||||||||
| Total Return | 0.95 | % | 20.90 | % | 3.24 | % | (2.61 | )% | 11.78 | % | ||||||||||
| Supplemental data and ratios: | ||||||||||||||||||||
| Net assets, end of year | $ | 1,798,973 | $ | 1,952,884 | $ | 1,833,241 | $ | 5,015,722 | $ | 11,351,746 | ||||||||||
| Ratio of expenses to average net assets: | ||||||||||||||||||||
| Before expense reimbursement or recovery | 2.60 | % | 2.66 | % | 2.35 | % | 2.04 | % | 2.06 | % | ||||||||||
| After expense reimbursement or recovery | 1.50 | % | 1.50 | % | 1.50 | % | 1.50 | % | 1.72 | % | ||||||||||
| Ratio of net investment income to average net assets: | ||||||||||||||||||||
| Before expense reimbursement or recovery | (0.43 | )% | (0.43 | )% | (0.10 | )% | (0.29 | )% | 0.18 | % | ||||||||||
| After expense reimbursement or recovery | 0.67 | % | 0.73 | % | 0.75 | % | 0.24 | % | 0.52 | % | ||||||||||
| Portfolio turnover rate | 101.26 | % | 87.41 | % | 110.53 | % | 95.84 | % | 107.17 | % | ||||||||||
| (1) | For a share outstanding throughout the period. Rounded to the nearest cent. |
| (2) | Net investment income per share is calculated based on average shares outstanding. |
| (3) | Amount represents less than $0.005 per share. |
| 44 | The Leuthold Funds - 2018 Annual Report | See Notes to the Financial Statements. |
Leuthold Global Industries Fund - Institutional - LGIIX
Financial Highlights
| Year Ended September 30, 2018 | Year Ended September 30, 2017 | Year Ended September 30, 2016 | Year Ended September 30, 2015 | Year Ended September 30, 2014 | ||||||||||||||||
Per Share Data(1): | ||||||||||||||||||||
| Net asset value, beginning of year | $ | 18.22 | $ | 15.70 | $ | 15.82 | $ | 16.63 | $ | 14.95 | ||||||||||
| Income (loss) from investment operations: | ||||||||||||||||||||
Net investment income (2) | 0.16 | 0.16 | 0.15 | 0.08 | 0.13 | |||||||||||||||
| Net realized and unrealized gain (loss) on investments | 0.09 | 3.03 | 0.43 | (0.48 | ) | 1.69 | ||||||||||||||
| Total from investment operations | 0.25 | 3.19 | 0.58 | (0.40 | ) | 1.82 | ||||||||||||||
| �� | ||||||||||||||||||||
| Less distributions: | ||||||||||||||||||||
| From net investment income | (0.18 | ) | (0.10 | ) | (0.12 | ) | (0.10 | ) | (0.14 | ) | ||||||||||
| From net realized gain | (1.27 | ) | (0.57 | ) | (0.58 | ) | (0.31 | ) | — | |||||||||||
| Redemption fees | — | — | — | 0.00 | (3) | — | ||||||||||||||
| Total distributions | (1.45 | ) | (0.67 | ) | (0.70 | ) | (0.41 | ) | (0.14 | ) | ||||||||||
| Net asset value, end of year | $ | 17.02 | $ | 18.22 | $ | 15.70 | $ | 15.82 | $ | 16.63 | ||||||||||
| Total Return | 1.17 | % | 21.25 | % | 3.47 | % | (2.44 | )% | 12.16 | % | ||||||||||
| Supplemental data and ratios: | ||||||||||||||||||||
| Net assets, end of year | $ | 8,640,784 | $ | 8,980,549 | $ | 9,802,258 | $ | 14,272,916 | $ | 16,853,310 | ||||||||||
| Ratio of expenses to average net assets: | ||||||||||||||||||||
| Before expense reimbursement or recovery | 2.35 | % | 2.41 | % | 2.10 | % | 1.79 | % | 1.81 | % | ||||||||||
| After expense reimbursement or recovery | 1.25 | % | 1.25 | % | 1.25 | % | 1.25 | % | 1.47 | % | ||||||||||
| Ratio of net investment income to average net assets: | ||||||||||||||||||||
| Before expense reimbursement or recovery | (0.18 | )% | (0.18 | )% | 0.15 | % | (0.05 | )% | 0.43 | % | ||||||||||
| After expense reimbursement or recovery | 0.92 | % | 0.98 | % | 1.00 | % | 0.49 | % | 0.77 | % | ||||||||||
| Portfolio turnover rate | 101.26 | % | 87.41 | % | 110.53 | % | 95.84 | % | 107.17 | % | ||||||||||
| (1) | For a share outstanding throughout the period. Rounded to the nearest cent. |
| (2) | Net investment income per share is calculated based on average shares outstanding. |
| (3) | Amount represents less than $0.005 per share. |
| See Notes to the Financial Statements. | The Leuthold Funds - 2018 Annual Report | 45 |
Grizzly Short Fund - GRZZX
Financial Highlights
| Year Ended September 30, 2018 | Year Ended September 30, 2017(1) | Year Ended September 30, 2016(1) | Year Ended September 30, 2015(1) | Year Ended September 30, 2014(1) | ||||||||||||||||
Per Share Data(2): | ||||||||||||||||||||
| Net asset value, beginning of year | $ | 21.48 | $ | 24.68 | $ | 31.96 | $ | 29.48 | $ | 34.32 | ||||||||||
| Income (loss) from investment operations: | ||||||||||||||||||||
| Net investment loss | (0.03 | )(3) | (0.40 | )(3) | (0.72 | )(3) | (0.80 | )(3) | (1.04 | )(4) | ||||||||||
| Net realized and unrealized gain (loss) on investments and securities sold short | (3.80 | ) | (2.80 | ) | (6.56 | ) | 3.28 | (3.80 | ) | |||||||||||
| Total from investment operations | (3.83 | ) | (3.20 | ) | (7.28 | ) | 2.48 | (4.84 | ) | |||||||||||
| Less distributions: | ||||||||||||||||||||
| From net investment income | — | — | — | — | — | |||||||||||||||
| From net realized gain | — | — | — | — | — | |||||||||||||||
| From return of capital | — | — | — | — | — | |||||||||||||||
| Total distributions | — | — | — | — | — | |||||||||||||||
| Net asset value, end of year | $ | 17.65 | $ | 21.48 | $ | 24.68 | $ | 31.96 | $ | 29.48 | ||||||||||
| Total Return | (17.83 | )% | (12.97 | )% | (22.78 | )% | 8.41 | % | (14.20 | )% | ||||||||||
| Supplemental data and ratios: | ||||||||||||||||||||
| Net assets, end of year | $ | 98,948,757 | $ | 205,698,273 | $ | 178,211,844 | $ | 265,843,184 | $ | 72,182,207 | ||||||||||
Ratio of expenses to average net assets (5) | 2.64 | % | 2.63 | % | 2.65 | % | 2.81 | % | 3.35 | % | ||||||||||
Ratio of net investment loss to average net assets (6) | (0.54 | )% | (1.78 | )% | (2.50 | )% | (2.81 | )% | (3.35 | )% | ||||||||||
Portfolio turnover rate(7) | 0.00 | % | 0.00 | % | 0.00 | % | 0.00 | % | 0.00 | % | ||||||||||
| (1) | Per share data adjusted for 1:4 reverse split completed as of May 18, 2018. |
| (2) | For a share outstanding throughout the period. Rounded to the nearest cent. |
| (3) | Net investment loss per share is calculated based on average shares outstanding. |
| (4) | Net investment loss per share is calculated using ending balances prior to consideration of adjustments for permanent book and tax differences. |
| (5) | The ratio of expenses to average net assets includes dividends and interest on securites sold short. The expense ratios excluding dividends and interest on securities sold short were 1.53% for the year ended September 30, 2018, 1.54% for the year ended September 30, 2017, 1.52% for the year ended September 30, 2016, 1.55% for the year ended September 30, 2015, and 1.57% for the year ended September 30, 2014. |
| (6) | The net investment income ratios include dividends and interest on securities sold short. |
| (7) | The portfolio turnover rate excludes purchases and sales of securities sold short. |
| 46 | The Leuthold Funds - 2018 Annual Report | See Notes to the Financial Statements. |
Schedule of Investments
September 30, 2018
| Shares | Fair Value | |||||||
COMMON STOCKS - 56.94% | ||||||||
| Biotechnology - 2.20% | ||||||||
| AbbVie, Inc. | 27,648 | $ | 2,614,948 | |||||
| Amgen, Inc. | 12,589 | 2,609,574 | ||||||
| Biogen, Inc. (a) | 7,453 | 2,633,219 | ||||||
| Celgene Corp. (a) | 29,489 | 2,638,971 | ||||||
| Gilead Sciences, Inc. | 34,420 | 2,657,568 | ||||||
| Regeneron Pharmaceuticals, Inc. (a) | 6,651 | 2,687,270 | ||||||
| Shire PLC - ADR | 14,408 | 2,611,738 | ||||||
| 18,453,288 | ||||||||
| Chemicals - 0.00% (i) | ||||||||
| China Lumena New Materials Corp. (a)(b)(d)(e) | 838,000 | 6,423 | ||||||
Commercial Services & Supplies - 2.14% | ||||||||
| Republic Services, Inc. | 78,555 | 5,707,806 | ||||||
| Stericycle, Inc. (a) | 54,290 | 3,185,737 | ||||||
| Tetra Tech, Inc. | 48,281 | 3,297,592 | ||||||
| Waste Management, Inc. | 63,626 | 5,749,246 | ||||||
| 17,940,381 | ||||||||
| Consumer Finance - 1.90% | ||||||||
| Ally Financial, Inc. | 125,956 | 3,331,536 | ||||||
| Capital One Financial Corp. | 38,735 | 3,677,113 | ||||||
| OneMain Holdings, Inc. (a) | 54,508 | 1,832,014 | ||||||
| Santander Consumer USA Holdings, Inc. (f) | 115,966 | 2,323,959 | ||||||
| Synchrony Financial | 86,409 | 2,685,592 | ||||||
| World Acceptance Corp. (a)(f) | 18,025 | 2,061,339 | ||||||
| 15,911,553 | ||||||||
| Food & Staples Retailing - 1.39% | ||||||||
| Kroger Co. (f) | 190,020 | 5,531,482 | ||||||
| Performance Food Group Co. (a) | 61,241 | 2,039,325 | ||||||
| Sprouts Farmers Market, Inc. (a) | 147,238 | 4,035,794 | ||||||
| 11,606,601 | ||||||||
Health Care Providers & Services - 13.04% | ||||||||
| Acadia Healthcare Co., Inc. (a)(f) | 124,001 | 4,364,835 | ||||||
| Aetna, Inc. | 34,964 | 7,092,447 | ||||||
| AMN Healthcare Services, Inc. (a)(f) | 42,999 | 2,352,045 | ||||||
| Anthem, Inc. | 31,055 | 8,510,623 | ||||||
| Centene Corp. (a) | 62,761 | 9,086,538 | ||||||
| Cigna Corp. | 25,626 | 5,336,615 | ||||||
| DaVita, Inc. (a) | 64,932 | 4,651,079 | ||||||
| Encompass Health Corp. | 79,265 | 6,178,707 | ||||||
| Express Scripts Holding Co. (a) | 75,574 | 7,180,286 | ||||||
| HCA Healthcare, Inc. | 83,391 | 11,601,356 | ||||||
| Humana, Inc. | 20,631 | 6,984,006 | ||||||
| Laboratory Corp. of America Holdings (a) | 27,363 | 4,752,406 | ||||||
| Premier, Inc. - Class A (a)(f) | 72,750 | 3,330,495 | ||||||
| Quest Diagnostics, Inc. | 45,388 | 4,897,819 | ||||||
| Select Medical Holdings Corp. (a) | 169,389 | 3,116,758 | ||||||
| Tenet Healthcare Corp. (a) | 78,774 | 2,241,908 | ||||||
| UnitedHealth Group, Inc. | 36,484 | 9,706,203 | ||||||
| Universal Health Services, Inc. - Class B | 61,023 | 7,801,180 | ||||||
| 109,185,306 | ||||||||
Hotels, Restaurants & Leisure - 2.27% | ||||||||
| Carnival Corp. | 83,391 | 5,317,844 | ||||||
| Marriott Vacations Worldwide Corp. | 37,037 | 4,138,885 | ||||||
| Norwegian Cruise Line Holdings, Ltd. (a) | 46,473 | 2,668,944 | ||||||
| Royal Caribbean Cruises, Ltd. | 39,307 | 5,107,551 | ||||||
| Wyndham Destinations, Inc. | 40,827 | 1,770,259 | ||||||
| 19,003,483 | ||||||||
| See Notes to the Financial Statements. | The Leuthold Funds - 2018 Annual Report | 47 |
Leuthold Core Investment Fund
Schedule of Investments (continued)
September 30, 2018
| Shares | Fair Value | |||||||
| COMMON STOCKS - 56.94% (continued) | ||||||||
| Household Durables - 2.56% | ||||||||
| D.R. Horton, Inc. | 151,799 | $ | 6,402,882 | |||||
| Lennar Corp. - Class A | 69,493 | 3,244,628 | ||||||
| MDC Holdings, Inc. (f) | 64,281 | 1,901,432 | ||||||
| Meritage Homes Corp. (a) | 49,731 | 1,984,267 | ||||||
| PulteGroup, Inc. | 176,773 | 4,378,667 | ||||||
| Toll Brothers, Inc. | 106,845 | 3,529,090 | ||||||
| 21,440,966 | ||||||||
| IT Services - 8.29% | ||||||||
| Accenture PLC - Class A (b) | 36,484 | 6,209,577 | ||||||
| Alliance Data Systems Corp. | 16,070 | 3,795,091 | ||||||
| Amdocs, Ltd. | 31,706 | 2,091,962 | ||||||
| CACI International, Inc. - Class A (a) | 13,681 | 2,519,356 | ||||||
| CGI Group, Inc. - Class A (a)(b) | 29,534 | 1,904,352 | ||||||
| Cognizant Technology Solutions Corp. - Class A | 31,055 | 2,395,893 | ||||||
| Convergys Corp. | 57,332 | 1,361,062 | ||||||
| First Data Corp. - Class A (a) | 177,424 | 4,341,565 | ||||||
| Fiserv, Inc. (a) | 76,442 | 6,297,292 | ||||||
| FleetCor Technologies, Inc. (a) | 17,373 | 3,958,264 | ||||||
| Genpact, Ltd. | 61,023 | 1,867,914 | ||||||
| International Business Machines Corp. | 27,797 | 4,203,185 | ||||||
| MasterCard, Inc. - Class A | 41,913 | 9,330,253 | ||||||
| MAXIMUS, Inc. | 52,337 | 3,405,045 | ||||||
| Science Applications International Corp. | 28,449 | 2,292,990 | ||||||
| Travelport Worldwide, Ltd. (b) | 127,693 | 2,154,181 | ||||||
| Visa, Inc. - Class A (f) | 59,503 | 8,930,805 | ||||||
| The Western Union Co. | 121,395 | 2,313,789 | ||||||
| 69,372,576 | ||||||||
| Media - 1.02% | ||||||||
| AMC Networks, Inc. - Class A (a)(f) | 39,666 | 2,631,443 | ||||||
| Nexstar Media Group, Inc. - Class A (f) | 30,391 | 2,473,827 | ||||||
| Viacom, Inc. - Class B (f) | 102,720 | 3,467,827 | ||||||
| 8,573,097 | ||||||||
| Metals & Mining - 0.45% | ||||||||
| Vale SA - ADR | 250,609 | 3,719,038 | ||||||
| Multiline Retail - 4.88% | ||||||||
| Dillard’s, Inc. - Class A (f) | 38,221 | 2,917,791 | ||||||
| Dollar General Corp. | 68,190 | 7,453,167 | ||||||
| Dollar Tree, Inc. (a) | 60,589 | 4,941,033 | ||||||
| Kohl’s Corp. (f) | 62,326 | 4,646,403 | ||||||
| Macy’s, Inc. | 124,436 | 4,321,662 | ||||||
| Nordstrom, Inc. (f) | 90,341 | 5,403,295 | ||||||
| Target Corp. | 126,607 | 11,168,004 | ||||||
| 40,851,355 | ||||||||
| Paper & Forest Products - 0.95% | ||||||||
| Boise Cascade Co. | 82,306 | 3,028,861 | ||||||
| Louisiana-Pacific Corp. | 187,196 | 4,958,822 | ||||||
| 7,987,683 | ||||||||
| Professional Services - 3.29% | ||||||||
| ASGN, Inc. (a) | 69,927 | 5,519,338 | ||||||
| Insperity, Inc. | 53,205 | 6,275,530 | ||||||
| Korn/Ferry International | 75,356 | 3,710,530 | ||||||
| Robert Half International, Inc. (f) | 80,785 | 5,685,648 | ||||||
| TriNet Group, Inc. (a) | 74,271 | 4,182,943 | ||||||
| TrueBlue, Inc. (a) | 82,306 | 2,144,071 | ||||||
| 27,518,060 | ||||||||
| 48 | The Leuthold Funds - 2018 Annual Report | See Notes to the Financial Statements. |
Leuthold Core Investment Fund
Schedule of Investments (continued)
September 30, 2018
September 30, 2018
| Shares | Fair Value | |||||||
| COMMON STOCKS - 56.94% (continued) | ||||||||
| Road & Rail - 4.02% | ||||||||
| Canadian National Railway Co. (b) | 39,307 | $ | 3,529,769 | |||||
| Canadian Pacific Railway, Ltd. (b) | 22,994 | 4,873,348 | ||||||
| CSX Corp. | 65,797 | 4,872,268 | ||||||
| Genesee & Wyoming, Inc. - Class A (a)(f) | 42,032 | 3,824,492 | ||||||
| Kansas City Southern | 38,826 | 4,398,209 | ||||||
| Norfolk Southern Corp. | 27,763 | 5,011,221 | ||||||
| Union Pacific Corp. | 29,209 | 4,756,101 | ||||||
| Werner Enterprises, Inc. (f) | 68,190 | 2,410,517 | ||||||
| 33,675,925 | ||||||||
| Semiconductors & Semiconductor Equipment - 4.69% | ||||||||
| Applied Materials, Inc. | 134,208 | 5,187,139 | ||||||
| Intel Corp. | 56,680 | 2,680,397 | ||||||
| KLA-Tencor Corp. | 27,363 | 2,783,091 | ||||||
| Kulicke & Soffa Industries, Inc. (b) | 74,271 | 1,770,621 | ||||||
| Lam Research Corp. (f) | 48,428 | 7,346,528 | ||||||
| Micron Technology, Inc. (a) | 74,271 | 3,359,277 | ||||||
| MKS Instruments, Inc. (f) | 50,817 | 4,072,982 | ||||||
| SolarEdge Technologies, Inc. (a)(b)(f) | 80,134 | 3,017,045 | ||||||
| Taiwan Semiconductor Manufacturing Co., Ltd. - ADR | 68,841 | 3,040,019 | ||||||
| Teradyne, Inc. | 162,005 | 5,990,945 | ||||||
| 39,248,044 | ||||||||
| Specialty Retail - 3.85% | ||||||||
| Aaron’s, Inc. | 86,866 | 4,730,722 | ||||||
| AutoZone, Inc. (a)(f) | 4,079 | 3,164,080 | ||||||
| Dick’s Sporting Goods, Inc. (f) | 84,985 | 3,015,268 | ||||||
| Group 1 Automotive, Inc. | 33,226 | 2,156,367 | ||||||
| The Home Depot, Inc. | 18,025 | 3,733,879 | ||||||
| Lowe’s Companies, Inc. | 59,503 | 6,832,135 | ||||||
| Penske Automotive Group, Inc. (f) | 56,246 | 2,665,498 | ||||||
| Williams-Sonoma, Inc. (f) | 90,124 | 5,922,949 | ||||||
| 32,220,898 | ||||||||
TOTAL COMMON STOCKS (Cost $364,779,545) | $ | 476,714,677 | ||||||
| INVESTMENT COMPANIES - 12.74% | ||||||||
| Exchange Traded Funds - 12.74% | ||||||||
| Financial Select Sector SPDR Fund | 608,202 | $ | 16,774,211 | |||||
| Invesco CurrencyShares Euro Currency Trust (a)(f) | 77,677 | 8,634,575 | ||||||
| Invesco CurrencyShares Japanese Yen Trust (a)(f)(h) | 287,011 | 24,151,976 | ||||||
| Invesco Optimum Yield Diversified Commodity Strategy No K-1 ETF | 927,029 | 17,400,334 | ||||||
| iShares Floating Rate Bond ETF | 191,359 | 9,763,136 | ||||||
| iShares International Treasury Bond ETF (f) | 347,250 | 16,723,560 | ||||||
| SPDR Bloomberg Barclays International Treasury Bond ETF | 195,593 | 5,355,337 | ||||||
| SPDR Gold Shares (a)(f) | 69,807 | 7,871,437 | ||||||
TOTAL INVESTMENT COMPANIES (Cost $107,765,510) | $ | 106,674,566 | ||||||
| See Notes to the Financial Statements. | The Leuthold Funds - 2018 Annual Report | 49 |
Leuthold Core Investment Fund
Schedule of Investments (continued)
September 30, 2018
Principal Amount | Fair Value | |||||||
CORPORATE BONDS - 3.07% | ||||||||
| Banks - 1.14% | ||||||||
| JPMorgan Chase & Co. | ||||||||
| 1.500%, 01/27/2025 | $ | 4,600,000 | $ | 5,462,212 | ||||
Wells Fargo & Co. 1.125%, 10/29/2021 | 3,430,000 | 4,085,296 | ||||||
| Food Products - 0.49% | 9,547,508 | |||||||
Kraft Heinz Foods Co. 3.950%, 07/15/2025 | 4,150,000 | 4,089,524 | ||||||
Internet Software & Services - 0.41% | ||||||||
Alibaba Group Holding, Ltd. 2.500%, 11/28/2019 (b) | 3,480,000 | 3,461,896 | ||||||
| Software - 0.53% | ||||||||
Oracle Corp. 2.950%, 05/15/2025 (f) | 4,620,000 | 4,433,016 | ||||||
| Technology Hardware, Storage & Peripherals - 0.50% | ||||||||
| Apple, Inc. 1.000%, 11/10/2022 | 3,500,000 | 4,197,761 | ||||||
| TOTAL CORPORATE BONDS (Cost $25,454,663) | $ | 25,729,705 | ||||||
UNITED STATES TREASURY OBLIGATIONS - 5.90% | ||||||||
United States Treasury Inflation Index Bond - 1.56% 0.125%, 07/15/2022 | 13,358,412 | 13,034,628 | ||||||
United States Treasury Notes - 4.34% | ||||||||
| 1.500%, 01/31/2019 (f) | 10,990,000 | 10,960,140 | ||||||
| 2.500%, 01/31/2025 | 13,980,000 | 13,577,529 | ||||||
| 3.500%, 02/15/2039 | 11,200,000 | 11,798,937 | ||||||
| 36,336,606 | ||||||||
| TOTAL UNITED STATES TREASURY OBLIGATIONS (Cost $49,863,031) | $ | 49,371,234 | ||||||
FOREIGN GOVERNMENT BONDS - 3.78% | ||||||||
| Argentina Republic Government International Bond 6.250%, 04/22/2019 (b) | $ | 4,300,000 | $ | 4,306,493 | ||||
Canadian Government Bond 2.250%, 06/01/2025 (b) | CAD | 5,400,000 | 4,144,076 | |||||
French Republic Government Bond OAT 1.250%, 05/25/2034 (b) | EUR | 13,500,000 | 15,799,557 | |||||
Government of the United Kingdom 2.250%, 09/07/2023 (b) | GBP | 3,750,000 | 5,144,317 | |||||
Korea International Bond 7.125%, 04/16/2019 (b)(f) | $ | 2,250,000 | 2,301,075 | |||||
TOTAL FOREIGN GOVERNMENT BONDS (Cost $31,867,574) | $ | 31,695,518 | ||||||
| 50 | The Leuthold Funds - 2018 Annual Report | See Notes to the Financial Statements. |
Leuthold Core Investment Fund
Schedule of Investments (continued)
September 30, 2018
September 30, 2018
| Shares | Fair Value | |||||||
| SHORT-TERM INVESTMENTS - 14.96% | ||||||||
| Money Market Funds - 14.96% | ||||||||
| Fidelity Institutional Money Market Funds - Government Portfolio - Class I, 1.920% (c)(g) | 125,227,621 | $ | 125,227,621 | |||||
TOTAL SHORT-TERM INVESTMENTS (Cost $125,227,621) | $ | 125,227,621 | ||||||
| INVESTMENTS PURCHASED AS SECURITIES LENDING COLLATERAL - 12.67% | ||||||||
| Mount Vernon Liquid Assets Portfolio, LLC, 2.310% (c) | 106,078,956 | $ | 106,078,956 | |||||
TOTAL INVESTMENTS PURCHASED AS SECURITIES LENDING COLLATERAL (Cost $106,078,956) | $ | 106,078,956 | ||||||
Total Investments (Cost $811,036,900) - 110.06% | $ | 921,492,277 | ||||||
| Liabilities in Excess of Other Assets - (g) (10.06)% | (84,233,041 | ) | ||||||
| TOTAL NET ASSETS - 100.00% | $ | 837,259,236 | ||||||
Percentages are stated as a percent of net assets.
ADR American Depositary Receipt
CAD Canadian Dollar
EUR Euro
GBP British Pound
| (a) | Non-income producing security. |
| (b) | Foreign issued security. |
| (c) | The rate quoted is the annualized seven-day yield as of September 30, 2018. |
| (d) | Illiquid security. The fair value of these securities total $6,423 which represents an amount that rounds to 0.00% of total net assets. |
| (e) | This security is currently being fair valued in accordance with procedures established by the Board of Directors of Leuthold Funds, Inc. and is deemed a Level 3 security as it is valued using significant unobservable inputs. |
| (f) | This security or a portion of this security was out on loan as of September 30, 2018. Total loaned securities had a value of $103,836,535 or 12.40% of net assets. The remaining contractual maturity of all of the securities lending transactions is overnight and continuous. See Note 7. |
| (g) | All or a portion of the assets have been committed as collateral for open securities sold short. |
| (h) | Affiliated security. At September 30, 2018, the market value of this security totals $24,151,976, which represents 2.88% of total net assets. |
| (i) | Rounds to less than 0.005%. |
The Global Industry Classification Standard (GICS®) was developed by and/or is the exclusive property of MSCI, Inc. and Standard & Poor’s Financial Services LLC (“S&P”). GICS® is a service mark of MSCI, Inc. and S&P and has been licensed for use by U.S. Bancorp Fund Services, LLC.
| See Notes to the Financial Statements. | The Leuthold Funds - 2018 Annual Report | 51 |
Leuthold Core Investment Fund
Schedule of Securities Sold Short - (a)
September 30, 2018
| Shares | Fair Value | |||||||
| COMMON STOCKS - 14.12% | ||||||||
| Aerospace & Defense - 0.21% | ||||||||
| Aerojet Rocketdyne Holdings, Inc. | 34,155 | $ | 1,160,928 | |||||
| Mercury Systems, Inc. | 11,064 | 612,061 | ||||||
| 1,772,989 | ||||||||
| Automobiles - 0.42% | ||||||||
| Ferrari NV (b) | 14,191 | 1,942,890 | ||||||
| Tesla Motors, Inc. | 5,773 | 1,528,517 | ||||||
| 3,471,407 | ||||||||
| Banks - 0.94% | ||||||||
| First Republic Bank | 19,122 | 1,835,712 | ||||||
| HDFC Bank, Ltd. - ADR | 20,445 | 1,923,874 | ||||||
| ICICI Bank, Ltd. - ADR | 185,926 | 1,578,512 | ||||||
| South State Corp. | 8,418 | 690,276 | ||||||
| Sterling Bancorp | 83,703 | 1,841,466 | ||||||
| 7,869,840 | ||||||||
| Beverages - 0.76% | ||||||||
| Anheuser-Busch InBev SA/NV - ADR | 18,400 | 1,611,288 | ||||||
| The Coca-Cola Co. | 46,542 | 2,149,775 | ||||||
| MGP Ingredients, Inc. | 7,697 | 607,909 | ||||||
| National Beverage Corp. | 17,318 | 2,019,625 | ||||||
| 6,388,597 | ||||||||
| Biotechnology - 0.22% | ||||||||
| Incyte Corp. | 26,578 | 1,836,008 | ||||||
| Building Products - 0.12% | ||||||||
| American Woodmark Corp. | 12,868 | 1,009,495 | ||||||
| Capital Markets - 0.25% | ||||||||
| MarketAxess Holdings, Inc. | 9,020 | 1,609,980 | ||||||
| WisdomTree Investments, Inc. | 57,125 | 484,420 | ||||||
| 2,094,400 | ||||||||
| Chemicals - 0.81% | ||||||||
| DowDuPont, Inc. | 19,723 | 1,268,386 | ||||||
| GCP Applied Technologies, Inc. | 40,889 | 1,085,603 | ||||||
| International Flavors & Fragrances, Inc. | 13,109 | 1,823,724 | ||||||
| The Scotts Miracle-Gro Co. | 22,489 | 1,770,559 | ||||||
| Tronox, Ltd. - Class A | 71,436 | 853,660 | ||||||
| 6,801,932 | ||||||||
| Commercial Services & Supplies - 0.51% | ||||||||
| ABM Industries, Inc. | 17,438 | 562,376 | ||||||
| The Brink’s Co. | 23,692 | 1,652,517 | ||||||
| Healthcare Services Group, Inc. | 35,598 | 1,445,991 | ||||||
| Ritchie Bros Auctioneers, Inc. (b) | 16,356 | 590,942 | ||||||
| 4,251,826 | ||||||||
| Communications Equipment - 0.40% | ||||||||
| Finisar Corp. | 91,640 | 1,745,742 | ||||||
| Viavi Solutions, Inc. | 140,828 | 1,596,990 | ||||||
| 3,342,732 | ||||||||
| Construction & Engineering - 0.07% | ||||||||
| Granite Construction, Inc. | 13,349 | 610,049 | ||||||
| Construction Materials - 0.20% | ||||||||
| Vulcan Materials Co. | 15,273 | 1,698,358 | ||||||
| Containers & Packaging - 0.26% | ||||||||
| Ball Corp. | 49,669 | 2,184,939 | ||||||
| Electronic Equipment, Instruments & Components - 0.23% | ||||||||
| Cognex Corp. | 34,395 | 1,919,929 | ||||||
| Energy Equipment & Services - 0.88% | ||||||||
| Baker Hughes, a GE Co. | 59,410 | 2,009,841 | ||||||
| Halliburton Co. | 41,491 | 1,681,630 | ||||||
| National Oilwell Varco, Inc. | 40,649 | 1,751,159 | ||||||
| Oceaneering International, Inc. | 69,632 | 1,921,843 | ||||||
| 7,364,473 | ||||||||
| 52 | The Leuthold Funds - 2018 Annual Report | See Notes to the Financial Statements. |
Leuthold Core Investment Fund
Schedule of Securities Sold Short - (a) (continued)
September 30, 2018
| Shares | Fair Value | |||||||
| COMMON STOCKS - 14.12% (continued) | ||||||||
| Health Care Equipment & Supplies - 0.14% | ||||||||
| Glaukos Corp. | 17,919 | $ | 1,162,943 | |||||
| Hotels, Restaurants & Leisure - 0.59% | ||||||||
| Caesars Entertainment Corp. | 156,582 | 1,604,966 | ||||||
| MGM Resorts International | 63,138 | 1,762,182 | ||||||
| Wynn Resorts, Ltd. | 12,507 | 1,589,139 | ||||||
| 4,956,287 | ||||||||
| Household Durables - 0.23% | ||||||||
| iRobot Corp. | 17,558 | 1,929,975 | ||||||
| Insurance - 1.17% | ||||||||
| American International Group, Inc. | 35,117 | 1,869,629 | ||||||
| Arch Capital Group, Ltd. (b) | 67,467 | 2,011,191 | ||||||
| Fidelity National Financial, Inc. | 51,232 | 2,015,979 | ||||||
| Marsh & McLennan Companies, Inc. | 26,338 | 2,178,680 | ||||||
| Willis Towers Watson PLC (b) | 12,387 | 1,745,824 | ||||||
| 9,821,303 | ||||||||
| Internet & Direct Marketing Retail - 0.73% | ||||||||
| Ctrip.com International, Ltd. - ADR | 41,731 | 1,551,141 | ||||||
| Expedia Group, Inc. | 13,710 | 1,788,881 | ||||||
| MakeMyTrip, Ltd. (b) | 19,603 | 538,102 | ||||||
| Wayfair, Inc. - Class A | 15,153 | 2,237,644 | ||||||
| 6,115,768 | ||||||||
| Internet Software & Services - 0.57% | ||||||||
| 2U, Inc. | 23,812 | 1,790,424 | ||||||
| Hortonworks, Inc. | 57,365 | 1,308,496 | ||||||
| LogMeIn, Inc. | 18,400 | 1,639,440 | ||||||
| 4,738,360 | ||||||||
| Machinery - 0.61% | ||||||||
| Actuant Corp. - Class A | 21,768 | 607,327 | ||||||
| Colfax Corp. | 20,926 | 754,591 | ||||||
| Flowserve Corp. | 33,553 | 1,835,014 | ||||||
| The Toro Co. | 32,110 | 1,925,637 | ||||||
| 5,122,569 | ||||||||
| Media - 0.07% | ||||||||
| Meredith Corp. | 11,425 | 583,246 | ||||||
| Metals & Mining - 0.43% | ||||||||
| Agnico Eagle Mines, Ltd. (b) | 48,706 | 1,665,745 | ||||||
| Barrick Gold Corp. (b) | 177,748 | 1,969,448 | ||||||
| 3,635,193 | ||||||||
| Multi-Utilities - 0.46% | ||||||||
| NiSource, Inc. | 80,576 | 2,007,954 | ||||||
| Sempra Energy | 15,995 | 1,819,431 | ||||||
| 3,827,385 | ||||||||
| Pharmaceuticals - 0.49% | ||||||||
| Amneal Pharmaceuticals, Inc. | 76,006 | 1,686,573 | ||||||
| AstraZeneca PLC - ADR | 60,853 | 2,407,953 | ||||||
| 4,094,526 | ||||||||
| Real Estate Investment Trusts (REITs) - 0.63% | ||||||||
| CyrusOne, Inc. | 32,952 | 2,089,157 | ||||||
| Equinix, Inc. | 4,089 | 1,770,087 | ||||||
| Healthcare Realty Trust, Inc. | 48,466 | 1,418,115 | ||||||
| 5,277,359 | ||||||||
| Semiconductors & Semiconductor Equipment - 0.08% | ||||||||
| Inphi Corp. | 16,717 | 634,912 | ||||||
| See Notes to the Financial Statements. | The Leuthold Funds - 2018 Annual Report | 53 |
Leuthold Core Investment Fund
Schedule of Securities Sold Short - (a) (continued)
September 30, 2018
| Shares | Fair Value | |||||||
| COMMON STOCKS - 14.12% (continued) | ||||||||
| Software - 1.64% | ||||||||
| Autodesk, Inc. | 13,469 | $ | 2,102,645 | |||||
| Guidewire Software, Inc. | 18,761 | 1,895,049 | ||||||
| Pegasystems, Inc. | 21,647 | 1,355,102 | ||||||
| RealPage, Inc. | 23,211 | 1,529,605 | ||||||
| Snap, Inc. - Class A | 122,187 | 1,036,146 | ||||||
| Symantec Corp. | 74,683 | 1,589,254 | ||||||
| The Ultimate Software Group, Inc. | 6,614 | 2,130,965 | ||||||
| Workday, Inc. - Class A | 14,191 | 2,071,602 | ||||||
| 13,710,368 | ||||||||
| TOTAL COMMON STOCKS (Proceeds $120,163,825) | $ | 118,227,168 | ||||||
| TOTAL SECURITIES SOLD SHORT | ||||||||
| (Proceeds $120,163,825) - 14.12% | $ | 118,227,168 | ||||||
Percentages are stated as a percent of net assets.
ADR American Depositary Receipt
| (a) | Non-income producing security. |
| (b) | Foreign issued security. |
The Global Industry Classification Standard (GICS®) was developed by and/or is the exclusive property of MSCI, Inc. and Standard & Poor’s Financial Services LLC (“S&P”). GICS® is a service mark of MSCI, Inc. and S&P and has been licensed for use by U.S. Bancorp Fund Services, LLC.
| 54 | The Leuthold Funds - 2018 Annual Report | See Notes to the Financial Statements. |
Schedule of Investments
September 30, 2018
September 30, 2018
| Shares | Fair Value | |||||||
| COMMON STOCKS - 59.46% | ||||||||
| Chemicals - 2.74% | ||||||||
| Denka Co., Ltd. (b) | 8,400 | $ | 292,795 | |||||
| Lotte Chemical Corp. (b) | 1,586 | 397,464 | ||||||
| LyondellBasell Industries NV - Class A (b) | 6,603 | 676,873 | ||||||
| Tosoh Corp. (b) | 36,000 | 554,470 | ||||||
| Trinseo SA (b) | 4,399 | 344,442 | ||||||
| 2,266,044 | ||||||||
| Communications Equipment - 2.72% | ||||||||
| Arcadyan Technology Corp. (b) | 124,000 | 220,388 | ||||||
| ARRIS International PLC (a)(b) | 14,878 | 386,679 | ||||||
| Ciena Corp. (a)(f) | 15,713 | 490,874 | ||||||
| CommScope Holding Co., Inc. (a)(f) | 13,078 | 402,279 | ||||||
| EchoStar Corp. - Class A (a) | 7,691 | 356,632 | ||||||
| Sangsangin Co., Ltd. (a)(b) | 9,993 | 186,629 | ||||||
| Taihan Fiberoptics Co., Ltd. (a)(b) | 33,663 | 206,878 | ||||||
| 2,250,359 | ||||||||
| Consumer Finance - 2.12% | ||||||||
| Ally Financial, Inc. | 14,633 | 387,043 | ||||||
| Encore Capital Group, Inc. (a) | 6,717 | 240,804 | ||||||
| Hitachi Capital Corp. (b) | 8,700 | 242,156 | ||||||
| Krungthai Card PLC - NVDR | 226,700 | 252,588 | ||||||
| Nelnet, Inc. - Class A | 4,425 | 252,977 | ||||||
| Santander Consumer USA Holdings, Inc. | 19,002 | 380,800 | ||||||
| 1,756,368 | ||||||||
| Health Care Equipment & Supplies - 3.33% | ||||||||
| CONMED Corp. | 4,054 | 321,158 | ||||||
| Danaher Corp. | 4,316 | 468,977 | ||||||
| Hill-Rom Holdings, Inc. | 3,145 | 296,888 | ||||||
| Integer Holdings Corp. (a) | 4,129 | 342,500 | ||||||
| Koninklijke Philips NV - NYRS | 10,496 | 477,673 | ||||||
| Shandong Weigao Group Medical Polymer Co., Ltd. (b) | 384,000 | 378,936 | ||||||
| Smith & Nephew PLC - ADR | 12,642 | 468,892 | ||||||
| 2,755,024 | ||||||||
| Health Care Providers & Services - 9.59% | ||||||||
| Acadia Healthcare Co., Inc. (a)(f) | 9,435 | 332,112 | ||||||
| Aetna, Inc. | 2,657 | 538,972 | ||||||
| Alfresa Holdings Corp. (b) | 19,200 | 514,287 | ||||||
| AmerisourceBergen Corp. | 4,334 | 399,682 | ||||||
| AMN Healthcare Services, Inc. (a) | 7,310 | 399,857 | ||||||
| Anthem, Inc. | 2,813 | 770,903 | ||||||
| Centene Corp. (a) | 5,471 | 792,091 | ||||||
| Cigna Corp. | 2,896 | 603,092 | ||||||
| Express Scripts Holding Co. (a) | 6,920 | 657,469 | ||||||
| HCA Healthcare, Inc. | 5,791 | 805,644 | ||||||
| Korian SA (b) | 7,617 | 277,389 | ||||||
| Laboratory Corp. of America Holdings (a)(f) | 2,462 | 427,600 | ||||||
| Medipal Holdings Corp. (b) | 20,900 | 436,638 | ||||||
| Select Medical Holdings Corp. (a) | 18,879 | 347,374 | ||||||
| Universal Health Services, Inc. - Class B | 4,943 | 631,913 | ||||||
| 7,935,023 | ||||||||
| Household Durables - 3.29% | ||||||||
| Barratt Developments PLC (b) | 42,626 | 314,793 | ||||||
| Bellway PLC (b) | 8,939 | 350,830 | ||||||
| Haseko Corp. (b) | 28,800 | 374,052 | ||||||
| Lennar Corp. - Class A | 8,452 | 394,624 | ||||||
| MDC Holdings, Inc. (f) | 10,702 | 316,565 | ||||||
| Meritage Homes Corp. (a) | 7,998 | 319,120 | ||||||
| Redrow PLC (b) | 45,281 | 344,159 | ||||||
| TRI Pointe Group, Inc. (a)(f) | 25,152 | 311,885 | ||||||
| 2,726,028 | ||||||||
| See Notes to the Financial Statements. | The Leuthold Funds - 2018 Annual Report | 55 |
Leuthold Global Fund
Schedule of Investments (continued)
September 30, 2018
September 30, 2018
| Shares | Fair Value | |||||||
| COMMON STOCKS - 59.46% (continued) | ||||||||
| Insurance - 3.20% | ||||||||
| Dai-ichi Life Holdings, Inc. (b) | 20,000 | $ | 416,906 | |||||
| Legal & General Group PLC (b) | 106,847 | 364,756 | ||||||
| Lincoln National Corp. | 3,375 | 228,353 | ||||||
| Medibank Pvt, Ltd. (b) | 127,764 | 268,652 | ||||||
| Old Mutual, Ltd. (b) | 86,384 | 182,361 | ||||||
| Ping An Insurance Group Co. of China, Ltd. (b) | 58,500 | 592,617 | ||||||
| Prudential Financial, Inc. | 3,054 | 309,431 | ||||||
| Unum Group | 7,325 | 286,188 | ||||||
| 2,649,264 | ||||||||
| IT Services - 7.35% | ||||||||
| Accenture PLC - Class A (b) | 3,011 | 512,472 | ||||||
| Alliance Data Systems Corp. (f) | 1,599 | 377,620 | ||||||
| Bechtle AG (b) | 2,757 | 279,872 | ||||||
| CACI International, Inc. - Class A (a)(f) | 1,995 | 367,379 | ||||||
| Computershare, Ltd. (b) | 18,219 | 262,376 | ||||||
| CSG Systems International, Inc. | 5,898 | 236,746 | ||||||
| DXC Technology Co. | 5,717 | 534,654 | ||||||
| Fidelity National Information Services, Inc. (f) | 3,516 | 383,490 | ||||||
| FleetCor Technologies, Inc. (a)(f) | 1,718 | 391,429 | ||||||
| Genpact, Ltd. | 12,504 | 382,747 | ||||||
| ManTech International Corp. - Class A | 4,255 | 269,341 | ||||||
| MAXIMUS, Inc. | 3,944 | 256,597 | ||||||
| NET One Systems Co., Ltd. (b) | 21,900 | 525,776 | ||||||
| NS Solutions Corp. (b) | 9,400 | 303,503 | ||||||
| Sabre Corp. | 9,768 | 254,749 | ||||||
| TIS, Inc. (b) | 5,100 | 254,937 | ||||||
| Travelport Worldwide, Ltd. (b) | 13,728 | 231,591 | ||||||
| Wipro, Ltd. - ADR | 49,587 | 258,348 | ||||||
| 6,083,627 | ||||||||
| Metals & Mining - 2.10% | ||||||||
| APERAM SA (b) | 5,366 | 245,464 | ||||||
| BlueScope Steel, Ltd. (b) | 46,793 | 573,906 | ||||||
| Evraz PLC (b) | 31,655 | 232,995 | ||||||
| Reliance Steel & Aluminum Co. | 2,453 | 209,216 | ||||||
| United States Steel Corp. | 6,708 | 204,460 | ||||||
| Voestalpine AG (b) | 5,950 | 271,796 | ||||||
| 1,737,837 | ||||||||
| Multiline Retail - 0.86% | ||||||||
| Dillard’s, Inc. - Class A (f) | 4,210 | 321,392 | ||||||
| Kohl’s Corp. | 5,253 | 391,611 | ||||||
| 713,003 | ||||||||
| Oil, Gas & Consumable Fuels - 10.82% | ||||||||
| Adaro Energy Tbk PT (b) | 1,753,700 | 215,781 | ||||||
| Antero Resources Corp. (a)(f) | 13,360 | 236,606 | ||||||
| Beach Energy, Ltd. (b) | 191,015 | 295,722 | ||||||
| Cenovus Energy, Inc. (b) | 27,392 | 274,742 | ||||||
| Chesapeake Energy Corp. (a)(f) | 57,503 | 258,188 | ||||||
| CNX Resources Corp. (a) | 15,627 | 223,622 | ||||||
| CVR Refining LP | 11,720 | 230,884 | ||||||
| DNO ASA (b) | 129,272 | 266,563 | ||||||
| Ecopetrol SA - ADR | 14,252 | 383,806 | ||||||
| Eni SpA - ADR | 7,974 | 300,301 | ||||||
| Equinor ASA - ADR (f) | 12,276 | 346,183 | ||||||
| Exxon Mobil Corp. | 4,930 | 419,149 | ||||||
| Formosa Petrochemical Corp. (b) | 85,000 | 412,014 | ||||||
| Galp Energia SGPS SA (b) | 13,117 | 260,081 | ||||||
| HollyFrontier Corp. | 6,909 | 482,939 | ||||||
| Idemitsu Kosan Co., Ltd. (b) | 6,400 | 338,845 | ||||||
| JXTG Holdings, Inc. (b) | 50,300 | 380,459 | ||||||
| Laredo Petroleum, Inc. (a)(f) | 26,361 | 215,369 | ||||||
| Marathon Petroleum Corp. | 4,312 | 344,831 | ||||||
| MOL Hungarian Oil & Gas PLC (b) | 22,567 | 243,068 | ||||||
| PBF Energy, Inc. - Class A | 8,258 | 412,157 | ||||||
| 56 | The Leuthold Funds - 2018 Annual Report | See Notes to the Financial Statements. |
Leuthold Global Fund
Schedule of Investments (continued)
September 30, 2018
September 30, 2018
| Shares | Fair Value | |||||||
| COMMON STOCKS - 59.46% (continued) | ||||||||
| Oil, Gas & Consumable Fuels - 10.82% (continued) | ||||||||
| Peabody Energy Corp. (f) | 8,573 | $ | 305,542 | |||||
| Peyto Exploration & Development Corp. (b) | 29,519 | 254,362 | ||||||
| PTT PCL - NVDR | 168,400 | 282,708 | ||||||
| Repsol SA (b) | 15,877 | 316,068 | ||||||
| Southwestern Energy Co. (a)(f) | 55,112 | 281,622 | ||||||
| Thai Oil PCL - NVDR | 70,300 | 192,488 | ||||||
| Whitehaven Coal, Ltd. (b) | 104,814 | 411,513 | ||||||
| Yanzhou Coal Mining Co., Ltd. (b) | 316,000 | 365,372 | ||||||
| 8,950,985 | ||||||||
| Paper & Forest Products - 4.37% | ||||||||
| China Forestry Holdings Co., Ltd. (a)(b)(d)(e) | 2,484,000 | 47,596 | ||||||
| Domtar Corp. | 6,362 | 331,906 | ||||||
| Fibria Celulose SA - ADR | 17,271 | 320,032 | ||||||
| Lee & Man Paper Manufacturing, Ltd. (b) | 243,000 | 225,009 | ||||||
| Louisiana-Pacific Corp. | 15,804 | 418,648 | ||||||
| Norbord, Inc. (b) | 7,050 | 233,608 | ||||||
| Sappi, Ltd. (b) | 59,737 | 374,750 | ||||||
| Stora Enso OYJ (b) | 31,666 | 604,698 | ||||||
| Suzano Papel e Celulose SA (b) | 18,900 | 224,588 | ||||||
| UPM-Kymmene OYJ (b) | 8,328 | 326,615 | ||||||
| West Fraser Timber Co., Ltd. (b) | 8,862 | 504,351 | ||||||
| 3,611,801 | ||||||||
| Semiconductors & Semiconductor Equipment - 4.53% | ||||||||
| Applied Materials, Inc. | 7,659 | 296,020 | ||||||
| Dongbu HiTek Co., Ltd. (b) | 18,464 | 263,346 | ||||||
| Intel Corp. | 8,566 | 405,086 | ||||||
| Lam Research Corp. (f) | 2,219 | 336,622 | ||||||
| Micron Technology, Inc. (a) | 15,975 | 722,549 | ||||||
| ON Semiconductor Corp. (a)(f) | 19,401 | 357,561 | ||||||
| SCREEN Holdings Co., Ltd. (b) | 3,800 | 223,443 | ||||||
| Sino-American Silicon Products, Inc. (b) | 96,000 | 246,205 | ||||||
| STMicroelectronics NV - NYRS (f) | 17,263 | 316,604 | ||||||
| SUMCO Corp. (b) | 22,700 | 330,685 | ||||||
| UniTest, Inc. (b) | 17,920 | 251,619 | ||||||
| 3,749,740 | ||||||||
| Wireless Telecommunication Services - 2.44% | ||||||||
| KDDI Corp. (b) | 23,400 | 645,530 | ||||||
| Rogers Communications, Inc. - Class B (b) | 7,605 | 391,128 | ||||||
| Softbank Group Corp. (b) | 9,800 | 979,016 | ||||||
| 2,015,674 | ||||||||
TOTAL COMMON STOCKS (Cost $45,240,442) | $ | 49,200,777 | ||||||
| INVESTMENT COMPANIES - 10.74% | ||||||||
| Exchange Traded Funds - 10.74% | ||||||||
| Invesco CurrencyShares Euro Currency Trust (a)(f) | 5,297 | $ | 588,814 | |||||
| Invesco CurrencyShares Japanese Yen Trust (a)(f) | 32,898 | 2,768,367 | ||||||
| Invesco Optimum Yield Diversified Commodity Strategy No K-1 ETF | 89,675 | 1,683,200 | ||||||
| iShares Floating Rate Bond ETF | 20,589 | 1,050,451 | ||||||
| iShares International Treasury Bond ETF (f) | 42,420 | 2,042,947 | ||||||
| SPDR Gold Shares (a) | 6,707 | 756,281 | ||||||
TOTAL INVESTMENT COMPANIES (Cost $8,984,957) | $ | 8,890,060 | ||||||
| See Notes to the Financial Statements. | The Leuthold Funds - 2018 Annual Report | 57 |
Leuthold Global Fund
Schedule of Investments (continued)
September 30, 2018
September 30, 2018
| Principal Amount | Fair Value | |||||||
| CORPORATE BONDS - 2.39% | ||||||||
| Banks - 1.71% | ||||||||
| JPMorgan Chase & Co. 1.500%, 01/27/2025 | 470,000 | $ | 558,095 | |||||
| Wells Fargo & Co. 1.125%, 10/29/2021 | 720,000 | 857,555 | ||||||
| 1,415,650 | ||||||||
| Diversified Telecommunication Services - 0.68% | ||||||||
| AT&T, Inc. 3.400%, 05/15/2025 (f) | 590,000 | 561,721 | ||||||
TOTAL CORPORATE BONDS (Cost $1,892,811) | $ | 1,977,371 | ||||||
| UNITED STATES TREASURY OBLIGATIONS - 5.82% | ||||||||
| United States Treasury Inflation | ||||||||
| Index Bond - 1.88% | ||||||||
| 0.125%, 07/15/2022 | 1,594,462 | $ | 1,555,815 | |||||
| United States Treasury Notes - 3.94% | ||||||||
| 1.500%, 01/31/2019 (f) | 762,000 | 759,929 | ||||||
| 2.500%, 01/31/2025 | 1,289,000 | 1,251,891 | ||||||
| 3.500%, 02/15/2039 | 1,190,000 | 1,253,637 | ||||||
| 3,265,457 | ||||||||
TOTAL UNITED STATES TREASURY OBLIGATIONS (Cost $4,874,644) | $ | 4,821,272 | ||||||
| FOREIGN GOVERNMENT BONDS - 5.16% | ||||||||
| Argentina Republic Government International Bond 6.250%, 04/22/2019 (b) | $ | 725,000 | $ | 726,095 | ||||
| Canadian Government Bond 2.250%, 06/01/2025 (b) | CAD | 610,000 | 468,127 | |||||
| French Republic Government Bond OAT 1.250%, 05/25/2034 (b) | EUR | 1,540,000 | 1,802,320 | |||||
| Government of the United Kingdom 2.250%, 09/07/2023 (b) | GBP | 630,000 | 864,245 | |||||
| Korea International Bond 7.125%, 04/16/2019 (b)(f) | $ | 400,000 | 409,080 | |||||
TOTAL FOREIGN GOVERNMENT BONDS (Cost $4,285,507) | $ | 4,269,867 | ||||||
| 58 | The Leuthold Funds - 2018 Annual Report | See Notes to the Financial Statements. |
Leuthold Global Fund
Schedule of Investments (continued)
September 30, 2018
September 30, 2018
| Shares | Fair Value | |||||||
| SHORT-TERM INVESTMENTS - 13.34% | ||||||||
| Money Market Funds - 13.34% | ||||||||
| Fidelity Institutional Money Market Funds - Government Portfolio - Class I, 1.920% (c)(g) | 11,035,551 | $ | 11,035,551 | |||||
TOTAL SHORT-TERM INVESTMENTS (Cost $11,035,551) | $ | 11,035,551 | ||||||
| INVESTMENTS PURCHASED AS SECURITIES LENDING COLLATERAL - 14.77% | ||||||||
| Mount Vernon Liquid Assets Portfolio, LLC, 2.310% (c) | 12,218,224 | $ | 12,218,224 | |||||
TOTAL INVESTMENTS PURCHASED AS SECURITIES LENDING COLLATERAL (Cost 12,218,224) | $ | 12,218,224 | ||||||
Total Investments (Cost $88,532,136) - 111.68% | $ | 92,413,122 | ||||||
| Liabilities in Excess of Other Assets - (g) (11.68)% | (9,661,964 | ) | ||||||
| TOTAL NET ASSETS - 100.00% | $ | 82,751,158 | ||||||
Percentages are stated as a percent of net assets.
| ADR | American Depositary Receipt |
| CAD | Canadian Dollar |
| EUR | Euro |
| GBP | British Pound |
| NVDR | Non-Voting Depositary Receipt |
| NYRS | New York Registry Shares |
| (a) | Non-income producing security. |
| (b) | Foreign issued security. |
| (c) | The rate quoted is the annualized seven-day yield as of September 30, 2018. |
| (d) | Illiquid security. The fair value of these securities total $47,596 which represents 0.06% of total net assets. |
| (e) | This security is currently being fair valued in accordance with procedures established by the Board of Directors of Leuthold Funds, Inc. and is deemed a Level 3 security as it is valued using significant unobservable inputs. |
| (f) | This security or a portion of this security was out on loan as of September 30, 2018. Total loaned securities had a value of $11,900,632 or 14.38% of net assets. The remaining contractual maturity of all of the securities lending transactions is overnight and continuous. See Note 7. |
| (g) | All or a portion of the assets have been committed as collateral for open securities sold short. |
The Global Industry Classification Standard (GICS®) was developed by and/or is the exclusive property of MSCI, Inc. and Standard & Poor’s Financial Services LLC (“S&P”). GICS® is a service mark of MSCI, Inc. and S&P and has been licensed for use by U.S. Bancorp Fund Services, LLC.
| See Notes to the Financial Statements. | The Leuthold Funds - 2018 Annual Report | 59 |
Leuthold Global Fund
Schedule of Investments (continued)
September 30, 2018
September 30, 2018
| Fair Value | Percentage of Total Investments | |||||||
| CURRENCY EXPOSURE | ||||||||
| Australian Dollar | $ | 1,812,169 | 1.96 | % | ||||
| Brazilian Real | 224,588 | 0.24 | ||||||
| British Pound | 2,654,139 | 2.87 | ||||||
| Canadian Dollar | 1,851,576 | 2.01 | ||||||
| Euro | 5,799,953 | 6.28 | ||||||
| Hong Kong Dollar | 1,609,530 | 1.74 | ||||||
| Hungarian Forint | 243,068 | 0.26 | ||||||
| Indonesian Rupiah | 215,782 | 0.23 | ||||||
| Japanese Yen | 6,813,498 | 7.37 | ||||||
| New Taiwan Dollar | 878,607 | 0.95 | ||||||
| Norwegian Krone | 266,563 | 0.29 | ||||||
| South African Rand | 374,750 | 0.41 | ||||||
| South Korea Won | 1,305,935 | 1.41 | ||||||
| Thai Baht | 727,783 | 0.79 | ||||||
| US Dollar | 67,635,181 | 73.19 | ||||||
| Total Investments | $ | 92,413,122 | 100.00 | % | ||||
| Fair Value | Percentage of Total Investments | |||||||
| PORTFOLIO DIVERSIFICATION | ||||||||
| Argentina | $ | 726,095 | 0.79 | % | ||||
| Australia | 1,812,169 | 1.96 | ||||||
| Austria | 271,796 | 0.30 | ||||||
| Brazil | 544,620 | 0.59 | ||||||
| Canada | 2,126,318 | 2.30 | ||||||
| China | 1,384,521 | 1.50 | ||||||
| Colombia | 383,806 | 0.42 | ||||||
| Finland | 931,313 | 1.01 | ||||||
| France | 2,079,709 | 2.25 | ||||||
| Germany | 279,872 | 0.30 | ||||||
| Hong Kong | 225,009 | 0.24 | ||||||
| Hungary | 243,068 | 0.26 | ||||||
| India | 258,348 | 0.28 | ||||||
| Indonesia | 215,782 | 0.23 | ||||||
| Ireland | 512,472 | 0.55 | ||||||
| Italy | 300,301 | 0.33 | ||||||
| Japan | 6,813,498 | 7.37 | ||||||
| Luxembourg | 245,464 | 0.27 | ||||||
| Netherlands | 477,673 | 0.52 | ||||||
| Norway | 612,746 | 0.66 | ||||||
| Portugal | 260,082 | 0.28 | ||||||
| Russia | 232,995 | 0.25 | ||||||
| South Africa | 557,111 | 0.60 | ||||||
| South Korea | 1,715,014 | 1.86 | ||||||
| Spain | 316,068 | 0.34 | ||||||
| Switzerland | 316,603 | 0.34 | ||||||
| Taiwan | 878,607 | 0.95 | ||||||
| Thailand | 727,783 | 0.79 | ||||||
| United Kingdom | 2,939,266 | 3.18 | ||||||
| United States | 64,025,013 | 69.28 | ||||||
| Total Investments | $ | 92,413,122 | 100.00 | % | ||||
| 60 | The Leuthold Funds - 2018 Annual Report | See Notes to the Financial Statements. |
Leuthold Global Fund
Schedule of Securities Sold Short - (a)
September 30, 2018
| Shares | Fair Value | |||||||
| COMMON STOCKS - 7.22% | ||||||||
| Aerospace & Defense - 0.11% | ||||||||
| Aerojet Rocketdyne Holdings, Inc. | 1,728 | $ | 58,735 | |||||
| Mercury Systems, Inc. | 561 | 31,034 | ||||||
| 89,769 | ||||||||
| Automobiles - 0.21% | ||||||||
| Ferrari NV (b) | 715 | 97,891 | ||||||
| Tesla, Inc. | 293 | 77,577 | ||||||
| 175,468 | ||||||||
| Banks - 0.48% | ||||||||
| First Republic Bank | 970 | 93,120 | ||||||
| HDFC Bank, Ltd. - ADR | 1,033 | 97,205 | ||||||
| ICICI Bank, Ltd. - ADR | 9,395 | 79,764 | ||||||
| South State Corp. | 425 | 34,850 | ||||||
| Sterling Bancorp | 4,232 | 93,104 | ||||||
| 398,043 | ||||||||
| Beverages - 0.39% | ||||||||
| Anheuser-Busch InBev SA/NV - ADR | 926 | 81,090 | ||||||
| The Coca-Cola Co. | 2,346 | 108,362 | ||||||
| MGP Ingredients, Inc. | 390 | 30,802 | ||||||
| National Beverage Corp. | 877 | 102,276 | ||||||
| 322,530 | ||||||||
| Biotechnology - 0.11% | ||||||||
| Incyte Corp. | 1,345 | 92,913 | ||||||
| Building Products - 0.06% | ||||||||
| American Woodmark Corp. | 652 | 51,149 | ||||||
| Capital Markets - 0.13% | ||||||||
| MarketAxess Holdings, Inc. | 454 | 81,034 | ||||||
| WisdomTree Investments, Inc. | 2,889 | 24,499 | ||||||
| 105,533 | ||||||||
| Chemicals - 0.42% | ||||||||
| DowDuPont, Inc. | 992 | 63,795 | ||||||
| GCP Applied Technologies, Inc. | 2,074 | 55,065 | ||||||
| International Flavors & Fragrances, Inc. | 664 | 92,376 | ||||||
| The Scotts Miracle-Gro Co. | 1,139 | 89,673 | ||||||
| Tronox, Ltd. - Class A (b) | 3,604 | 43,068 | ||||||
| 343,977 | ||||||||
| Commercial Services & Supplies - 0.26% | ||||||||
| ABM Industries, Inc. | 882 | 28,444 | ||||||
| The Brink’s Co. | 1,198 | 83,561 | ||||||
| Healthcare Services Group, Inc. | 1,787 | 72,588 | ||||||
| Ritchie Bros Auctioneers, Inc. (b) | 828 | 29,916 | ||||||
| 214,509 | ||||||||
| Communications Equipment - 0.20% | ||||||||
| Finisar Corp. | 4,631 | 88,220 | ||||||
| Viavi Solutions, Inc. | 7,117 | 80,707 | ||||||
| 168,927 | ||||||||
| Construction & Engineering - 0.04% | ||||||||
| Granite Construction, Inc. | 672 | 30,710 | ||||||
| Construction Materials - 0.10% | ||||||||
| Vulcan Materials Co. | 770 | 85,624 | ||||||
| Containers & Packaging - 0.13% | ||||||||
| Ball Corp. | 2,511 | 110,459 | ||||||
| Electronic Equipment, Instruments & Components - 0.12% | ||||||||
| Cognex Corp. | 1,741 | 97,183 | ||||||
| Energy Equipment & Services - 0.45% | ||||||||
| Baker Hughes, a GE Co. | 3,003 | 101,592 | ||||||
| Halliburton Co. | 2,098 | 85,032 | ||||||
| National Oilwell Varco, Inc. | 2,053 | 88,443 | ||||||
| Oceaneering International, Inc. | 3,513 | 96,959 | ||||||
| 372,026 | ||||||||
| See Notes to the Financial Statements. | The Leuthold Funds - 2018 Annual Report | 61 |
Leuthold Global Fund
Schedule of Securities Sold Short - (a) (continued)
September 30, 2018
| Shares | Fair Value | |||||||
| COMMON STOCKS - 7.22% (continued) | ||||||||
| Health Care Equipment & Supplies - 0.07% | ||||||||
| Glaukos Corp. | 907 | $ | 58,864 | |||||
| Hotels, Restaurants & Leisure - 0.30% | ||||||||
| Caesars Entertainment Corp. | 7,921 | 81,190 | ||||||
| MGM Resorts International | 3,198 | 89,256 | ||||||
| Wynn Resorts, Ltd. | 630 | 80,048 | ||||||
| 250,494 | ||||||||
| Household Durables - 0.12% | ||||||||
| iRobot Corp. | 888 | 97,609 | ||||||
| Insurance - 0.60% | ||||||||
| American International Group, Inc. | 1,777 | 94,607 | ||||||
| Arch Capital Group, Ltd. (b) | 3,412 | 101,712 | ||||||
| Fidelity National Financial, Inc. | 2,582 | 101,602 | ||||||
| Marsh & McLennan Companies, Inc. | 1,330 | 110,018 | ||||||
| Willis Towers Watson PLC (b) | 627 | 88,369 | ||||||
| 496,308 | ||||||||
| Internet & Direct Marketing Retail - 0.38% | ||||||||
| Ctrip.com International, Ltd. - ADR | 2,111 | 78,466 | ||||||
| Expedia Group, Inc. | 694 | 90,553 | ||||||
| MakeMyTrip, Ltd. (b) | 994 | 27,286 | ||||||
| Wayfair, Inc. - Class A | 769 | 113,558 | ||||||
| 309,863 | ||||||||
| Internet Software & Services - 0.29% | ||||||||
| 2U, Inc. | 1,201 | 90,303 | ||||||
| Hortonworks, Inc. | 2,903 | 66,217 | ||||||
| LogMeIn, Inc. | 926 | 82,507 | ||||||
| 239,027 | ||||||||
| Machinery - 0.31% | ||||||||
| Actuant Corp. - Class A | 1,100 | 30,690 | ||||||
| Colfax Corp. | 1,062 | 38,296 | ||||||
| Flowserve Corp. | 1,693 | 92,590 | ||||||
| The Toro Co. | 1,621 | 97,211 | ||||||
| 258,787 | ||||||||
| Media - 0.04% | ||||||||
| Meredith Corp. | 575 | 29,354 | ||||||
| Metals & Mining - 0.22% | ||||||||
| Agnico Eagle Mines, Ltd. (b) | 2,461 | 84,166 | ||||||
| Barrick Gold Corp. (b) | 8,997 | 99,687 | ||||||
| 183,853 | ||||||||
| Multi-Utilities - 0.23% | ||||||||
| NiSource, Inc. | 4,064 | 101,275 | ||||||
| Sempra Energy | 805 | 91,569 | ||||||
| 192,844 | ||||||||
| Pharmaceuticals - 0.25% | ||||||||
| Amneal Pharmaceuticals, Inc. | 3,844 | 85,298 | ||||||
| AstraZeneca PLC - ADR | 3,075 | 121,678 | ||||||
| 206,976 | ||||||||
| Real Estate Investment Trusts (REITs) - 0.32% | ||||||||
| CyrusOne, Inc. | 1,670 | 105,878 | ||||||
| Equinix, Inc. | 208 | 90,041 | ||||||
| Healthcare Realty Trust, Inc. | 2,457 | 71,892 | ||||||
| 267,811 | ||||||||
| Semiconductors & Semiconductor Equipment - 0.04% | ||||||||
| Inphi Corp. | 844 | 32,055 | ||||||
| 62 | The Leuthold Funds - 2018 Annual Report | See Notes to the Financial Statements. |
Leuthold Global Fund
Schedule of Securities Sold Short - (a) (continued)
September 30, 2018
| Shares | Fair Value | |||||||
| COMMON STOCKS - 7.22% (continued) | ||||||||
| Software - 0.84% | ||||||||
| Autodesk, Inc. | 680 | $ | 106,155 | |||||
| Guidewire Software, Inc. | 948 | 95,757 | ||||||
| Pegasystems, Inc. | 1,090 | 68,234 | ||||||
| RealPage, Inc. | 1,173 | 77,301 | ||||||
| Snap, Inc. - Class A | 6,173 | 52,347 | ||||||
| Symantec Corp. | 3,779 | 80,417 | ||||||
| The Ultimate Software Group, Inc. | 332 | 106,967 | ||||||
| Workday, Inc. - Class A | 715 | 104,376 | ||||||
| 691,554 | ||||||||
| TOTAL COMMON STOCKS (Proceeds $6,168,374) | $ | 5,974,219 | ||||||
| INVESTMENT COMPANIES - 7.15% | ||||||||
| Exchange Traded Funds - 7.15% | ||||||||
| iShares MSCI ACWI ETF | 36,572 | $ | 2,715,837 | |||||
| iShares MSCI EAFE ETF | 37,777 | 2,568,458 | ||||||
| iShares MSCI Emerging Markets ETF | 14,796 | 635,044 | ||||||
| TOTAL INVESTMENT COMPANIES (Proceeds $5,993,000) | $ | 5,919,339 | ||||||
| TOTAL SECURITIES SOLD SHORT (Proceeds $12,161,374) - 14.37% | $ | 11,893,558 | ||||||
Percentages are stated as a percent of net assets.
ADR American Depositary Receipt
| (a) | Non-income producing security. |
| (b) | Foreign issued security. |
The Global Industry Classification Standard (GICS®) was developed by and/or is the exclusive property of MSCI, Inc. and Standard & Poor’s Financial Services LLC (“S&P”). GICS® is a service mark of MSCI, Inc. and S&P and has been licensed for use by U.S. Bancorp Fund Services, LLC.
| See Notes to the Financial Statements. | The Leuthold Funds - 2018 Annual Report | 63 |
Schedule of Investments
September 30, 2018
| Shares | Fair Value | |||||||
| COMMON STOCKS - 99.91% | ||||||||
| Biotechnology - 3.81% | ||||||||
| AbbVie, Inc. | 1,024 | $ | 96,850 | |||||
| Amgen, Inc. | 466 | 96,597 | ||||||
| Biogen, Inc. (a) | 281 | 99,280 | ||||||
| Celgene Corp. (a) | 1,113 | 99,603 | ||||||
| Gilead Sciences, Inc. | 1,299 | 100,296 | ||||||
| Regeneron Pharmaceuticals, Inc. (a) | 251 | 101,414 | ||||||
| Shire PLC - ADR | 534 | 96,798 | ||||||
| 690,838 | ||||||||
| Commercial Services & Supplies - 3.73% | ||||||||
| Republic Services, Inc. | 2,954 | 214,638 | ||||||
| Stericycle, Inc. (a) | 2,051 | 120,353 | ||||||
| Tetra Tech, Inc. | 1,824 | 124,579 | ||||||
| Waste Management, Inc. | 2,393 | 216,231 | ||||||
| 675,801 | ||||||||
| Consumer Finance - 3.36% | ||||||||
| Ally Financial, Inc. | 4,881 | 129,103 | ||||||
| Capital One Financial Corp. | 1,501 | 142,490 | ||||||
| OneMain Holdings, Inc. (a) | 2,103 | 70,682 | ||||||
| Santander Consumer USA Holdings, Inc. | 4,405 | 88,276 | ||||||
| Synchrony Financial | 3,214 | 99,891 | ||||||
| World Acceptance Corp. (a) | 690 | 78,908 | ||||||
| 609,350 | ||||||||
| Food & Staples Retailing - 2.47% | ||||||||
| Kroger Co. | 7,366 | 214,424 | ||||||
| Performance Food Group Co. (a) | 2,359 | 78,555 | ||||||
| Sprouts Farmers Market, Inc. (a) | 5,633 | 154,400 | ||||||
| 447,379 | ||||||||
| Health Care Providers & Services - 22.97% | ||||||||
| Acadia Healthcare Co., Inc. (a) | 4,715 | 165,968 | ||||||
| Aetna, Inc. | 1,317 | 267,153 | ||||||
| AMN Healthcare Services, Inc. (a) | 1,631 | 89,216 | ||||||
| Anthem, Inc. | 1,173 | 321,461 | ||||||
| Centene Corp. (a) | 2,364 | 342,260 | ||||||
| Cigna Corp. | 976 | 203,252 | ||||||
| DaVita, Inc. (a) | 2,504 | 179,361 | ||||||
| Encompass Health Corp. | 3,028 | 236,033 | ||||||
| Express Scripts Holding Co. (a) | 2,903 | 275,814 | ||||||
| HCA Healthcare, Inc. | 3,201 | 445,323 | ||||||
| Humana, Inc. | 776 | 262,691 | ||||||
| Laboratory Corp. of America Holdings (a) | 1,053 | 182,885 | ||||||
| Premier, Inc. - Class A (a) | 2,756 | 126,170 | ||||||
| Quest Diagnostics, Inc. | 1,745 | 188,303 | ||||||
| Select Medical Holdings Corp. (a) | 6,415 | 118,036 | ||||||
| Tenet Healthcare Corp. (a) | 2,967 | 84,441 | ||||||
| UnitedHealth Group, Inc. | 1,389 | 369,529 | ||||||
| Universal Health Services, Inc. - Class B | 2,364 | 302,214 | ||||||
| 4,160,110 | ||||||||
| Hotels, Restaurants & Leisure - 3.96% | ||||||||
| Carnival Corp. | 3,166 | 201,896 | ||||||
| Marriott Vacations Worldwide Corp. | 1,399 | 156,338 | ||||||
| Norwegian Cruise Line Holdings, Ltd. (a) | 1,745 | 100,215 | ||||||
| Royal Caribbean Cruises, Ltd. | 1,476 | 191,792 | ||||||
| Wyndham Destinations, Inc. | 1,542 | 66,861 | ||||||
| 717,102 | ||||||||
| 64 | The Leuthold Funds - 2018 Annual Report | See Notes to the Financial Statements. |
Leuthold Select Industries Fund
Schedule of Investments (continued)
September 30, 2018
| Shares | Fair Value | |||||||
| COMMON STOCKS - 99.91% (continued) | ||||||||
| Household Durables - 4.48% | ||||||||
| D.R. Horton, Inc. | 5,730 | $ | 241,691 | |||||
| Lennar Corp. - Class A | 2,637 | 123,121 | ||||||
| MDC Holdings, Inc. | 2,432 | 71,939 | ||||||
| Meritage Homes Corp. (a) | 1,882 | 75,092 | ||||||
| PulteGroup, Inc. | 6,677 | 165,389 | ||||||
| Toll Brothers, Inc. | 4,053 | 133,871 | ||||||
| 811,103 | ||||||||
| IT Services - 14.58% | ||||||||
| Accenture PLC - Class A (b) | 1,377 | 234,365 | ||||||
| Alliance Data Systems Corp. | 628 | 148,308 | ||||||
| Amdocs, Ltd. | 1,191 | 78,582 | ||||||
| CACI International, Inc. - Class A (a) | 523 | 96,310 | ||||||
| CGI Group, Inc. - Class A (a)(b) | 1,115 | 71,895 | ||||||
| Cognizant Technology Solutions Corp. - Class A | 1,183 | 91,268 | ||||||
| Convergys Corp. | 2,167 | 51,445 | ||||||
| First Data Corp. - Class A (a) | 6,895 | 168,721 | ||||||
| Fiserv, Inc. (a) | 2,889 | 237,996 | ||||||
| FleetCor Technologies, Inc. (a) | 675 | 153,792 | ||||||
| Genpact, Ltd. | 2,362 | 72,301 | ||||||
| International Business Machines Corp. | 1,046 | 158,166 | ||||||
| MasterCard, Inc. - Class A | 1,583 | 352,392 | ||||||
| MAXIMUS, Inc. | 2,032 | 132,202 | ||||||
| Science Applications International Corp. | 1,081 | 87,129 | ||||||
| Travelport Worldwide, Ltd. (b) | 4,861 | 82,005 | ||||||
| Visa, Inc. - Class A | 2,243 | 336,652 | ||||||
| The Western Union Co. | 4,573 | 87,161 | ||||||
| 2,640,690 | ||||||||
| Media - 1.77% | ||||||||
| AMC Networks, Inc. - Class A (a) | 1,483 | 98,382 | ||||||
| Nexstar Media Group, Inc. - Class A | 1,136 | 92,471 | ||||||
| Viacom, Inc. - Class B | 3,820 | 128,963 | ||||||
| 319,816 | ||||||||
| Metals & Mining - 0.79% | ||||||||
| Vale SA - ADR | 9,611 | 142,627 | ||||||
| Multiline Retail - 8.60% | ||||||||
| Dillard’s, Inc. - Class A | 1,461 | 111,533 | ||||||
| Dollar General Corp. | 2,572 | 281,120 | ||||||
| Dollar Tree, Inc. (a) | 2,291 | 186,831 | ||||||
| Kohl’s Corp. | 2,414 | 179,964 | ||||||
| Macy’s, Inc. | 4,787 | 166,252 | ||||||
| Nordstrom, Inc. | 3,503 | 209,514 | ||||||
| Target Corp. | 4,776 | 421,291 | ||||||
| 1,556,505 | ||||||||
| Paper & Forest Products - 1.70% | ||||||||
| Boise Cascade Co. | 3,159 | 116,251 | ||||||
| Louisiana-Pacific Corp. | 7,209 | 190,967 | ||||||
| 307,218 | ||||||||
| Professional Services - 5.77% | ||||||||
| ASGN, Inc. (a) | 2,624 | 207,112 | ||||||
| Insperity, Inc. | 2,056 | 242,505 | ||||||
| Korn/Ferry International | 2,840 | 139,842 | ||||||
| Robert Half International, Inc. | 3,071 | 216,137 | ||||||
| TriNet Group, Inc. (a) | 2,817 | 158,654 | ||||||
| TrueBlue, Inc. (a) | 3,124 | 81,380 | ||||||
| 1,045,630 | ||||||||
| See Notes to the Financial Statements. | The Leuthold Funds - 2018 Annual Report | 65 |
Leuthold Select Industries Fund
Schedule of Investments (continued)
September 30, 2018
| Shares | Fair Value | |||||||
| COMMON STOCKS - 99.91% (continued) | ||||||||
| Road & Rail - 7.06% | ||||||||
| Canadian National Railway Co. (b) | 1,499 | $ | 134,610 | |||||
| Canadian Pacific Railway, Ltd. (b) | 861 | 182,480 | ||||||
| CSX Corp. | 2,504 | 185,421 | ||||||
| Genesee & Wyoming, Inc. - Class A (a) | 1,615 | 146,949 | ||||||
| Kansas City Southern | 1,453 | 164,596 | ||||||
| Norfolk Southern Corp. | 1,057 | 190,789 | ||||||
| Union Pacific Corp. | 1,111 | 180,904 | ||||||
| Werner Enterprises, Inc. | 2,645 | 93,501 | ||||||
| 1,279,250 | ||||||||
| Semiconductors & Semiconductor Equipment - 8.16% | ||||||||
| Applied Materials, Inc. | 5,034 | 194,564 | ||||||
| Intel Corp. | 2,149 | 101,626 | ||||||
| KLA-Tencor Corp. | 1,038 | 105,575 | ||||||
| Kulicke & Soffa Industries, Inc. (b) | 2,811 | 67,014 | ||||||
| Lam Research Corp. | 1,831 | 277,762 | ||||||
| Micron Technology, Inc. (a) | 2,812 | 127,187 | ||||||
| MKS Instruments, Inc. | 1,913 | 153,327 | ||||||
| SolarEdge Technologies, Inc. (a)(b) | 2,978 | 112,122 | ||||||
| Taiwan Semiconductor Manufacturing Co., Ltd. - ADR | 2,593 | 114,507 | ||||||
| Teradyne, Inc. | 6,064 | 224,247 | ||||||
| 1,477,931 | ||||||||
| Specialty Retail - 6.70% | ||||||||
| Aaron’s, Inc. | 3,283 | 178,792 | ||||||
| AutoZone, Inc. (a) | 152 | 117,906 | ||||||
| Dick’s Sporting Goods, Inc. | 3,161 | 112,152 | ||||||
| Group 1 Automotive, Inc. | 1,265 | 82,099 | ||||||
| The Home Depot, Inc. | 672 | 139,205 | ||||||
| Lowe’s Companies, Inc. | 2,257 | 259,149 | ||||||
| Penske Automotive Group, Inc. | 2,126 | 100,751 | ||||||
| Williams-Sonoma, Inc. | 3,396 | 223,185 | ||||||
| 1,213,239 | ||||||||
| TOTAL COMMON STOCKS (Cost $14,331,246) | $ | 18,094,589 | ||||||
| SHORT-TERM INVESTMENTS - 0.29% | ||||||||
| Money Market Funds - 0.29% | ||||||||
| Fidelity Institutional Money Market Funds - Government Portfolio - Class I, 1.920% (c) | 52,883 | $ | 52,883 | |||||
| TOTAL SHORT-TERM INVESTMENTS (Cost $52,883) | $ | 52,883 | ||||||
| Total Investments (Cost $14,384,129) - 100.20% | $ | 18,147,472 | ||||||
| Liabilities in Excess of Other Assets - (0.20)% | (35,540 | ) | ||||||
| TOTAL NET ASSETS - 100.00% | $ | 18,111,932 | ||||||
Percentages are stated as a percent of net assets.
ADR American Depositary Receipt
| (a) | Non-income producing security. |
| (b) | Foreign issued security. |
| (c) | The rate quoted is the annualized seven-day yield as of September 30, 2018. |
The Global Industry Classification Standard (GICS®) was developed by and/or is the exclusive property of MSCI, Inc. and Standard & Poor’s Financial Services LLC (“S&P”). GICS® is a service mark of MSCI, Inc. and S&P and has been licensed for use by U.S. Bancorp Fund Services, LLC.
| 66 | The Leuthold Funds - 2018 Annual Report | See Notes to the Financial Statements. |
Schedule of Investments
September 30, 2018
| Shares | Fair Value | |||||||
| COMMON STOCKS - 96.33% | ||||||||
| Chemicals - 4.26% | ||||||||
| Denka Co., Ltd. (b) | 1,400 | $ | 48,799 | |||||
| Lotte Chemical Corp. (b) | 322 | 80,696 | ||||||
| LyondellBasell Industries NV - Class A (b) | 1,339 | 137,261 | ||||||
| Tosoh Corp. (b) | 7,000 | 107,814 | ||||||
| Trinseo SA (b) | 891 | 69,765 | ||||||
| 444,335 | ||||||||
| Communications Equipment - 4.39% | ||||||||
| Arcadyan Technology Corp. (b) | 26,000 | 46,210 | ||||||
| ARRIS International PLC (a)(b) | 3,024 | 78,594 | ||||||
| Ciena Corp. (a) | 3,194 | 99,780 | ||||||
| CommScope Holding Co., Inc. (a) | 2,659 | 81,791 | ||||||
| EchoStar Corp. - Class A (a) | 1,564 | 72,523 | ||||||
| Sangsangin Co., Ltd. (a)(b) | 2,031 | 37,931 | ||||||
| Taihan Fiberoptics Co., Ltd. (a)(b) | 6,843 | 42,054 | ||||||
| 458,883 | ||||||||
| Consumer Finance - 3.48% | ||||||||
| Ally Financial, Inc. | 3,059 | 80,910 | ||||||
| Encore Capital Group, Inc. (a) | 1,354 | 48,541 | ||||||
| Hitachi Capital Corp. (b) | 1,800 | 50,101 | ||||||
| Krungthai Card PLC - NVDR | 47,600 | 53,036 | ||||||
| Nelnet, Inc. - Class A | 892 | 50,996 | ||||||
| Santander Consumer USA Holdings, Inc. | 3,973 | 79,619 | ||||||
| 363,203 | ||||||||
| Health Care Equipment & Supplies - 5.38% | ||||||||
| CONMED Corp. | 820 | 64,960 | ||||||
| Danaher Corp. | 878 | 95,404 | ||||||
| Hill-Rom Holdings, Inc. | 640 | 60,416 | ||||||
| Integer Holdings Corp. (a) | 834 | 69,180 | ||||||
| Koninklijke Philips NV - NYRS | 2,135 | 97,164 | ||||||
| Shandong Weigao Group Medical Polymer Co., Ltd. (b) | 80,000 | 78,945 | ||||||
| Smith & Nephew PLC - ADR | 2,572 | 95,396 | ||||||
| 561,465 | ||||||||
| Health Care Providers & Services - 15.65% | ||||||||
| Acadia Healthcare Co., Inc. (a) | 1,988 | 69,978 | ||||||
| Aetna, Inc. | 541 | 109,742 | ||||||
| Alfresa Holdings Corp. (b) | 3,900 | 104,465 | ||||||
| AmerisourceBergen Corp. | 906 | 83,551 | ||||||
| AMN Healthcare Services, Inc. (a) | 1,528 | 83,581 | ||||||
| Anthem, Inc. | 576 | 157,853 | ||||||
| Centene Corp. (a) | 1,119 | 162,009 | ||||||
| Cigna Corp. | 589 | 122,659 | ||||||
| Express Scripts Holding Co. (a) | 1,411 | 134,059 | ||||||
| HCA Healthcare, Inc. | 1,198 | 166,666 | ||||||
| Korian SA (b) | 1,605 | 58,449 | ||||||
| Laboratory Corp. of America Holdings (a) | 502 | 87,187 | ||||||
| Medipal Holdings Corp. (b) | 4,300 | 89,835 | ||||||
| Select Medical Holdings Corp. (a) | 3,977 | 73,177 | ||||||
| Universal Health Services, Inc. - Class B | 1,021 | 130,525 | ||||||
| 1,633,736 | ||||||||
| Household Durables - 5.32% | ||||||||
| Barratt Developments PLC (b) | 8,686 | 64,146 | ||||||
| Bellway PLC (b) | 1,821 | 71,469 | ||||||
| Haseko Corp. (b) | 5,900 | 76,629 | ||||||
| Lennar Corp. - Class A | 1,722 | 80,400 | ||||||
| MDC Holdings, Inc. | 2,181 | 64,514 | ||||||
| Meritage Homes Corp. (a) | 1,630 | 65,037 | ||||||
| Redrow PLC (b) | 9,227 | 70,130 | ||||||
| TRI Pointe Group, Inc. (a) | 5,125 | 63,550 | ||||||
| 555,875 | ||||||||
| See Notes to the Financial Statements. | The Leuthold Funds - 2018 Annual Report | 67 |
Leuthold Global Industries Fund
Schedule of Investments (continued)
September 30, 2018
| Shares | Fair Value | |||||||
| COMMON STOCKS - 96.33% (continued) | ||||||||
| Insurance - 5.18% | ||||||||
| Dai-ichi Life Holdings, Inc. (b) | 4,100 | $ | 85,466 | |||||
| Legal & General Group PLC (b) | 21,687 | 74,035 | ||||||
| Lincoln National Corp. | 689 | 46,618 | ||||||
| Medibank Pvt, Ltd. (b) | 25,874 | 54,406 | ||||||
| Old Mutual, Ltd. (b) | 17,516 | 36,977 | ||||||
| Ping An Insurance Group Co. of China, Ltd. (b) | 12,000 | 121,562 | ||||||
| Prudential Financial, Inc. | 619 | 62,717 | ||||||
| Unum Group | 1,509 | 58,957 | ||||||
| 540,738 | ||||||||
| IT Services - 11.96% | ||||||||
| Accenture PLC - Class A (b) | 617 | 105,013 | ||||||
| Alliance Data Systems Corp. | 325 | 76,752 | ||||||
| Bechtle AG (b) | 580 | 58,878 | ||||||
| CACI International, Inc. - Class A (a) | 408 | 75,133 | ||||||
| Computershare, Ltd. (b) | 3,700 | 53,285 | ||||||
| CSG Systems International, Inc. | 1,198 | 48,088 | ||||||
| DXC Technology Co. | 1,169 | 109,325 | ||||||
| Fidelity National Information Services, Inc. | 715 | 77,985 | ||||||
| FleetCor Technologies, Inc. (a) | 350 | 79,744 | ||||||
| Genpact, Ltd. | 2,545 | 77,902 | ||||||
| ManTech International Corp. - Class A | 881 | 55,767 | ||||||
| MAXIMUS, Inc. | 805 | 52,373 | ||||||
| NET One Systems Co., Ltd. (b) | 4,500 | 108,036 | ||||||
| NS Solutions Corp. (b) | 2,000 | 64,575 | ||||||
| Sabre Corp. | 1,969 | 51,352 | ||||||
| TIS, Inc. (b) | 1,100 | 54,986 | ||||||
| Travelport Worldwide, Ltd. (b) | 2,788 | 47,034 | ||||||
| Wipro, Ltd. - ADR | 10,106 | 52,652 | ||||||
| 1,248,880 | ||||||||
| Metals & Mining - 3.37% | ||||||||
| APERAM SA (b) | 1,081 | 49,450 | ||||||
| BlueScope Steel, Ltd. (b) | 9,415 | 115,473 | ||||||
| Evraz PLC (b) | 6,668 | 49,080 | ||||||
| Reliance Steel & Aluminum Co. | 494 | 42,133 | ||||||
| United States Steel Corp. | 1,338 | 40,782 | ||||||
| Voestalpine AG (b) | 1,199 | 54,770 | ||||||
| 351,688 | ||||||||
| Multiline Retail - 1.40% | ||||||||
| Dillard’s, Inc. - Class A | 861 | 65,729 | ||||||
| Kohl’s Corp. | 1,074 | 80,066 | ||||||
| 145,795 | ||||||||
| Oil, Gas & Consumable Fuels - 17.64% | ||||||||
| Adaro Energy Tbk PT (b) | 356,400 | 43,853 | ||||||
| Antero Resources Corp. (a) | 2,716 | 48,100 | ||||||
| Beach Energy, Ltd. (b) | 38,831 | 60,117 | ||||||
| Cenovus Energy, Inc. (b) | 5,599 | 56,158 | ||||||
| Chesapeake Energy Corp. (a) | 11,690 | 52,488 | ||||||
| CNX Resources Corp. (a) | 3,177 | 45,463 | ||||||
| CVR Refining LP | 2,469 | 48,639 | ||||||
| DNO ASA (b) | 26,279 | 54,188 | ||||||
| Ecopetrol SA - ADR | 2,913 | 78,447 | ||||||
| Eni SpA - ADR | 1,630 | 61,386 | ||||||
| Equinor ASA - ADR | 2,509 | 70,754 | ||||||
| Exxon Mobil Corp. | 1,008 | 85,700 | ||||||
| Formosa Petrochemical Corp. (b) | 18,000 | 87,250 | ||||||
| Galp Energia SGPS SA (b) | 2,681 | 53,158 | ||||||
| HollyFrontier Corp. | 1,416 | 98,979 | ||||||
| Idemitsu Kosan Co., Ltd. (b) | 1,300 | 68,828 | ||||||
| JXTG Holdings, Inc. (b) | 10,600 | 80,176 | ||||||
| Laredo Petroleum, Inc. (a) | 5,359 | 43,783 | ||||||
| Marathon Petroleum Corp. | 909 | 72,693 | ||||||
| MOL Hungarian Oil & Gas PLC (b) | 4,613 | 49,686 | ||||||
| PBF Energy, Inc. - Class A | 1,740 | 86,843 | ||||||
| 68 | The Leuthold Funds - 2018 Annual Report | See Notes to the Financial Statements. |
Leuthold Global Industries Fund
Schedule of Investments (continued)
September 30, 2018
| Shares | Fair Value | |||||||
| COMMON STOCKS - 96.33% (continued) | ||||||||
| Oil, Gas & Consumable Fuels - 17.64% (continued) | ||||||||
| Peabody Energy Corp. | 1,806 | $ | 64,366 | |||||
| Peyto Exploration & Development Corp. (b) | 6,001 | 51,710 | ||||||
| PTT PCL - NVDR | 34,400 | 57,750 | ||||||
| Repsol SA (b) | 3,246 | 64,619 | ||||||
| Southwestern Energy Co. (a) | 11,203 | 57,247 | ||||||
| Thai Oil PCL - NVDR | 14,300 | 39,155 | ||||||
| Whitehaven Coal, Ltd. (b) | 21,300 | 83,627 | ||||||
| Yanzhou Coal Mining Co., Ltd. (b) | 66,000 | 76,312 | ||||||
| 1,841,475 | ||||||||
| Paper & Forest Products - 6.95% | ||||||||
| China Forestry Holdings Co., Ltd. (a)(b)(d)(e) | 116,000 | 2,223 | ||||||
| Domtar Corp. | 1,291 | 67,351 | ||||||
| Fibria Celulose SA - ADR | 3,506 | 64,966 | ||||||
| Lee & Man Paper Manufacturing, Ltd. (b) | 49,000 | 45,372 | ||||||
| Louisiana-Pacific Corp. | 3,212 | 85,086 | ||||||
| Norbord, Inc. (b) | 1,431 | 47,418 | ||||||
| Sappi, Ltd. (b) | 12,140 | 76,158 | ||||||
| Stora Enso OYJ (b) | 6,361 | 121,470 | ||||||
| Suzano Papel e Celulose SA (b) | 3,900 | 46,344 | ||||||
| UPM-Kymmene OYJ (b) | 1,691 | 66,319 | ||||||
| West Fraser Timber Co., Ltd. (b) | 1,801 | 102,498 | ||||||
| 725,205 | ||||||||
| Semiconductors & Semiconductor Equipment - 7.39% | ||||||||
| Applied Materials, Inc. | 1,563 | 60,410 | ||||||
| Dongbu HiTek Co., Ltd. (b) | 3,761 | 53,642 | ||||||
| Intel Corp. | 1,791 | 84,696 | ||||||
| Lam Research Corp. | 453 | 68,720 | ||||||
| Micron Technology, Inc. (a) | 3,247 | 146,862 | ||||||
| ON Semiconductor Corp. (a) | 3,952 | 72,835 | ||||||
| SCREEN Holdings Co., Ltd. (b) | 800 | 47,041 | ||||||
| Sino-American Silicon Products, Inc. (b) | 19,000 | 48,728 | ||||||
| STMicroelectronics NV - NYRS | 3,517 | 64,502 | ||||||
| SUMCO Corp. (b) | 4,900 | 71,381 | ||||||
| UniTest, Inc. (b) | 3,762 | 52,823 | ||||||
| 771,640 | ||||||||
| Wireless Telecommunication Services - 3.96% | ||||||||
| KDDI Corp. (b) | 4,700 | 129,658 | ||||||
| Rogers Communications, Inc. - Class B (b) | 1,631 | 83,883 | ||||||
| Softbank Group Corp. (b) | 2,000 | 199,799 | ||||||
| 413,340 | ||||||||
| TOTAL COMMON STOCKS (Cost $9,209,082) | $ | 10,056,258 | ||||||
| INVESTMENT COMPANIES - 3.04% | ||||||||
| Exchange Traded Funds - 3.04% | ||||||||
| iShares Core MSCI EAFE ETF | 1,938 | $ | 124,187 | |||||
| iShares Core MSCI Emerging Markets ETF | 585 | 30,291 | ||||||
| SPDR S&P 500 ETF Trust | 561 | 163,094 | ||||||
| TOTAL INVESTMENT COMPANIES (Cost $312,097) | $ | 317,572 | ||||||
| See Notes to the Financial Statements. | The Leuthold Funds - 2018 Annual Report | 69 |
Leuthold Global Industries Fund
Schedule of Investments (continued)
September 30, 2018
| Shares | Fair Value | |||||||
| SHORT-TERM INVESTMENTS - 0.45% | ||||||||
| Money Market Funds - 0.45% | ||||||||
| Fidelity Institutional Money Market Funds - Government Portfolio - Class I, 1.920% (c) | 46,846 | $ | 46,846 | |||||
| TOTAL SHORT-TERM INVESTMENTS (Cost $46,846) | $ | 46,846 | ||||||
| Total Investments (Cost $9,568,025) - 99.82% | $ | 10,420,676 | ||||||
| Other Assets in Excess of Liabilities - 0.18% | 19,081 | |||||||
| TOTAL NET ASSETS - 100.00% | $ | 10,439,757 | ||||||
Percentages are stated as a percent of net assets.
| ADR | American Depositary Receipt |
| NVDR | Non-Voting Depositary Receipt |
| NYRS | New York Registry Shares |
| (a) | Non-income producing security. |
| (b) | Foreign issued security. |
| (c) | The rate quoted is the annualized seven-day yield as of September 30, 2018. |
| (d) | Illiquid security. The fair value of these securities total $2,223 which represents 0.02% of total net assets. |
| (e) | The security is currently being fair valued in accordance with procedures established by the Board of Directors of Leuthold Funds, Inc. and is deemed a Level 3 security as it is valued using significant unobservable inputs. |
The Global Industry Classification Standard (GICS®) was developed by and/or is the exclusive property of MSCI, Inc. and Standard & Poor’s Financial Services LLC (“S&P”). GICS® is a service mark of MSCI, Inc. and S&P and has been licensed for use by U.S. Bancorp Fund Services, LLC.
| 70 | The Leuthold Funds - 2018 Annual Report | See Notes to the Financial Statements. |
Leuthold Global Industries Fund
Schedule of Investments (continued)
September 30, 2018
| Fair Value | Percentage of Total Investments | |||||||
| CURRENCY EXPOSURE | ||||||||
| Australian Dollar | $ | 366,906 | 3.52 | % | ||||
| Brazilian Real | 46,344 | 0.44 | ||||||
| British Pound | 365,837 | 3.51 | ||||||
| Canadian Dollar | 285,508 | 2.74 | ||||||
| Euro | 527,114 | 5.06 | ||||||
| Hong Kong Dollar | 324,414 | 3.11 | ||||||
| Hungarian Forint | 49,686 | 0.48 | ||||||
| Indonesian Rupiah | 43,853 | 0.42 | ||||||
| Japanese Yen | 1,387,588 | 13.32 | ||||||
| New Taiwan Dollar | 182,189 | 1.75 | ||||||
| Norwegian Krone | 54,188 | 0.52 | ||||||
| South African Rand | 76,158 | 0.73 | ||||||
| South Korea Won | 267,145 | 2.56 | ||||||
| Thai Baht | 149,941 | 1.44 | ||||||
| US Dollar | 6,293,805 | 60.40 | ||||||
| Total Investments | $ | 10,420,676 | 100.00 | % | ||||
| Fair Value | Percentage of Total Investments | |||||||
| PORTFOLIO DIVERSIFICATION | ||||||||
| Australia | $ | 366,906 | 3.52 | % | ||||
| Austria | 54,770 | 0.53 | ||||||
| Brazil | 111,310 | 1.07 | ||||||
| Canada | 341,666 | 3.28 | ||||||
| China | 279,042 | 2.68 | ||||||
| Colombia | 78,447 | 0.75 | ||||||
| Finland | 187,790 | 1.80 | ||||||
| France | 58,449 | 0.56 | ||||||
| Germany | 58,878 | 0.56 | ||||||
| Hong Kong | 45,372 | 0.44 | ||||||
| Hungary | 49,686 | 0.48 | ||||||
| India | 52,652 | 0.50 | ||||||
| Indonesia | 43,853 | 0.42 | ||||||
| Ireland | 105,013 | 1.01 | ||||||
| Italy | 61,386 | 0.59 | ||||||
| Japan | 1,387,588 | 13.32 | ||||||
| Luxembourg | 49,450 | 0.47 | ||||||
| Netherlands | 97,164 | 0.93 | ||||||
| Norway | 124,942 | 1.20 | ||||||
| Portugal | 53,158 | 0.51 | ||||||
| Russia | 49,080 | 0.47 | ||||||
| South Africa | 113,136 | 1.09 | ||||||
| South Korea | 267,145 | 2.56 | ||||||
| Spain | 64,619 | 0.62 | ||||||
| Switzerland | 64,502 | 0.62 | ||||||
| Taiwan | 182,189 | 1.75 | ||||||
| Thailand | 149,941 | 1.44 | ||||||
| United Kingdom | 422,209 | 4.05 | ||||||
| United States | 5,500,333 | 52.78 | ||||||
| Total Investments | $ | 10,420,676 | 100.00 | % | ||||
| See Notes to the Financial Statements. | The Leuthold Funds - 2018 Annual Report | 71 |
Schedule of Investments
September 30, 2018
| Shares | Fair Value | |||||||
| SHORT-TERM INVESTMENTS - 82.71% | ||||||||
| Money Market Funds - 82.71% | ||||||||
| Fidelity Institutional Money Market Funds - Government Portfolio - Class I, 1.920% (a)(b) | 81,840,809 | $ | 81,840,809 | |||||
| TOTAL SHORT-TERM INVESTMENTS (Cost $81,840,809) | $ | 81,840,809 | ||||||
| Total Investments (Cost $81,840,809) - 82.71% | $ | 81,840,809 | ||||||
| Other Assets in Excess of Liabilities - 17.29% | 17,107,948 | |||||||
| TOTAL NET ASSETS - 100.00% | $ | 98,948,757 | ||||||
Percentages are stated as a percent of net assets.
| (a) | The rate quoted is the annualized seven-day yield as of September 30, 2018. |
| (b) | All or a portion of the assets have been committed as collateral for open securities sold short. |
The Global Industry Classification Standard (GICS®) was developed by and/or is the exclusive property of MSCI, Inc. and Standard & Poor’s Financial Services LLC (“S&P”). GICS® is a service mark of MSCI, Inc. and S&P and has been licensed for use by U.S. Bancorp Fund Services, LLC.
| 72 | The Leuthold Funds - 2018 Annual Report | See Notes to the Financial Statements. |
Grizzly Short Fund
Schedule of Securities Sold Short - (a)
September 30, 2018
September 30, 2018
| Shares | Fair Value | |||||||
| COMMON STOCKS - 95.96% | ||||||||
| Aerospace & Defense - 1.44% | ||||||||
| Aerojet Rocketdyne Holdings, Inc. | 27,418 | $ | 931,938 | |||||
| Mercury Systems, Inc. | 8,879 | 491,186 | ||||||
| 1,423,124 | ||||||||
| Automobiles - 2.81% | ||||||||
| Ferrari NV (b) | 11,332 | 1,551,464 | ||||||
| Tesla, Inc. | 4,634 | 1,226,944 | ||||||
| 2,778,408 | ||||||||
| Banks - 6.38% | ||||||||
| First Republic Bank | 15,350 | 1,473,600 | ||||||
| HDFC Bank, Ltd. - ADR | 16,412 | 1,544,369 | ||||||
| ICICI Bank, Ltd. - ADR | 149,266 | 1,267,269 | ||||||
| South State Corp. | 6,758 | 554,156 | ||||||
| Sterling Bancorp | 67,194 | 1,478,268 | ||||||
| 6,317,662 | ||||||||
| Beverages - 5.19% | ||||||||
| Anheuser-Busch InBev SA/NV - ADR | 14,771 | 1,293,496 | ||||||
| The Coca-Cola Co. | 37,362 | 1,725,751 | ||||||
| MGP Ingredients, Inc. | 6,221 | 491,335 | ||||||
| National Beverage Corp. | 13,902 | 1,621,251 | ||||||
| 5,131,833 | ||||||||
| Biotechnology - 1.49% | ||||||||
| Incyte Corp. | 21,336 | 1,473,891 | ||||||
| Building Products - 0.82% | ||||||||
| American Woodmark Corp. | 10,330 | 810,388 | ||||||
| Capital Markets - 1.70% | ||||||||
| MarketAxess Holdings, Inc. | 7,241 | 1,292,446 | ||||||
| WisdomTree Investments, Inc. | 45,858 | 388,876 | ||||||
| 1,681,322 | ||||||||
| Chemicals - 5.53% | ||||||||
| DowDuPont, Inc. | 15,833 | 1,018,220 | ||||||
| GCP Applied Technologies, Inc. | 32,825 | 871,504 | ||||||
| International Flavors & Fragrances, Inc. | 10,601 | 1,474,811 | ||||||
| The Scotts Miracle-Gro Co. | 18,054 | 1,421,391 | ||||||
| Tronox, Ltd. - Class A (b) | 57,346 | 685,285 | ||||||
| 5,471,211 | ||||||||
| Commercial Services & Supplies - 3.45% | ||||||||
| ABM Industries, Inc. | 13,999 | 451,468 | ||||||
| The Brink’s Co. | 19,019 | 1,326,575 | ||||||
| Healthcare Services Group, Inc. | 28,577 | 1,160,798 | ||||||
| Ritchie Bros Auctioneers, Inc. (b) | 13,215 | 477,458 | ||||||
| 3,416,299 | ||||||||
| Communications Equipment - 2.72% | ||||||||
| Finisar Corp. | 73,944 | 1,408,633 | ||||||
| Viavi Solutions, Inc. | 113,052 | 1,282,010 | ||||||
| 2,690,643 | ||||||||
| Construction & Engineering - 0.50% | ||||||||
| Granite Construction, Inc. | 10,730 | 490,361 | ||||||
| Construction Materials - 1.38% | ||||||||
| Vulcan Materials Co. | 12,261 | 1,363,423 | ||||||
| Containers & Packaging - 1.77% | ||||||||
| Ball Corp. | 39,872 | 1,753,969 | ||||||
| Electronic Equipment, Instruments & Components - 1.56% | ||||||||
| Cognex Corp. | 27,611 | 1,541,246 | ||||||
| Energy Equipment & Services - 5.97% | ||||||||
| Baker Hughes, a GE Co. | 47,692 | 1,613,420 | ||||||
| Halliburton Co. | 33,307 | 1,349,933 | ||||||
| National Oilwell Varco, Inc. | 32,631 | 1,405,743 | ||||||
| Oceaneering International, Inc. | 55,898 | 1,542,785 | ||||||
| 5,911,881 | ||||||||
| See Notes to the Financial Statements. | The Leuthold Funds - 2018 Annual Report | 73 |
Grizzly Short Fund
Schedule of Securities Sold Short - (a) (continued)
September 30, 2017
September 30, 2017
| Shares | Fair Value | |||||||
| COMMON STOCKS - 95.96% (continued) | ||||||||
| Health Care Equipment & Supplies - 0.94% | ||||||||
| Glaukos Corp. | 14,360 | $ | 931,964 | |||||
| Hotels, Restaurants & Leisure - 4.01% | ||||||||
| Caesars Entertainment Corp. | 125,699 | 1,288,415 | ||||||
| MGM Resorts International | 50,685 | 1,414,618 | ||||||
| Wynn Resorts, Ltd. | 9,978 | 1,267,805 | ||||||
| 3,970,838 | ||||||||
| Household Durables - 1.57% | ||||||||
| iRobot Corp. | 14,153 | 1,555,698 | ||||||
| Insurance - 7.97% | ||||||||
| American International Group, Inc. | 28,190 | 1,500,836 | ||||||
| Arch Capital Group, Ltd. (b) | 54,161 | 1,614,539 | ||||||
| Fidelity National Financial, Inc. | 41,127 | 1,618,348 | ||||||
| Marsh & McLennan Companies, Inc. | 21,143 | 1,748,949 | ||||||
| Willis Towers Watson PLC (b) | 9,944 | 1,401,507 | ||||||
| 7,884,179 | ||||||||
| Internet & Direct Marketing Retail - 4.96% | ||||||||
| Ctrip.com International, Ltd. - ADR | 33,500 | 1,245,195 | ||||||
| Expedia Group, Inc. | 11,022 | 1,438,151 | ||||||
| MakeMyTrip, Ltd. (b) | 15,736 | 431,953 | ||||||
| Wayfair, Inc. - Class A | 12,164 | 1,796,258 | ||||||
| 4,911,557 | ||||||||
| Internet Software & Services - 3.85% | ||||||||
| 2U, Inc. | 19,135 | 1,438,761 | ||||||
| Hortonworks, Inc. | 46,051 | 1,050,423 | ||||||
| LogMeIn, Inc. | 14,771 | 1,316,096 | ||||||
| 3,805,280 | ||||||||
| Machinery - 4.16% | ||||||||
| Actuant Corp. - Class A | 17,474 | 487,525 | ||||||
| Colfax Corp. | 16,798 | 605,736 | ||||||
| Flowserve Corp. | 27,005 | 1,476,903 | ||||||
| The Toro Co. | 25,777 | 1,545,847 | ||||||
| 4,116,011 | ||||||||
| Media - 0.47% | ||||||||
| Meredith Corp. | 9,178 | 468,537 | ||||||
| Metals & Mining - 2.95% | ||||||||
| Agnico Eagle Mines, Ltd. (b) | 39,100 | 1,337,220 | ||||||
| Barrick Gold Corp. (b) | 142,690 | 1,581,005 | ||||||
| 2,918,225 | ||||||||
| Multi-Utilities - 3.11% | ||||||||
| NiSource, Inc. | 64,684 | 1,611,925 | ||||||
| Sempra Energy | 12,840 | 1,460,550 | ||||||
| 3,072,475 | ||||||||
| Pharmaceuticals - 3.32% | ||||||||
| Amneal Pharmaceuticals, Inc. | 61,015 | 1,353,923 | ||||||
| AstraZeneca PLC - ADR | 48,851 | 1,933,034 | ||||||
| 3,286,957 | ||||||||
| Real Estate Investment Trusts (REITs) - 4.30% | ||||||||
| CyrusOne, Inc. | 26,453 | 1,677,120 | ||||||
| Equinix, Inc. | 3,316 | 1,435,463 | ||||||
| Healthcare Realty Trust, Inc. | 38,907 | 1,138,419 | ||||||
| 4,251,002 | ||||||||
| Semiconductors & Semiconductor Equipment - 0.51% | ||||||||
| Inphi Corp. | 13,368 | 507,717 | ||||||
| 74 | The Leuthold Funds - 2018 Annual Report | See Notes to the Financial Statements. |
Grizzly Short Fund
Schedule of Securities Sold Short - (a) (continued)
September 30, 2018
September 30, 2018
| Shares | Fair Value | |||||||
| COMMON STOCKS - 95.96% (continued) | ||||||||
| Software - 11.13% | ||||||||
| Autodesk, Inc. | 10,813 | $ | 1,688,017 | |||||
| Guidewire Software, Inc. | 15,132 | 1,528,483 | ||||||
| Pegasystems, Inc. | 17,378 | 1,087,863 | ||||||
| RealPage, Inc. | 18,633 | 1,227,915 | ||||||
| Snap, Inc. - Class A | 98,087 | 831,778 | ||||||
| Symantec Corp. | 59,953 | 1,275,800 | ||||||
| The Ultimate Software Group, Inc. | 5,310 | 1,710,829 | ||||||
| Workday, Inc. - Class A | 11,392 | 1,663,004 | ||||||
| 11,013,689 | ||||||||
TOTAL COMMON STOCKS (Proceeds $98,232,054) | $ | 94,949,790 | ||||||
| TOTAL SECURITIES SOLD SHORT (Proceeds $98,232,054) - 95.96% | $ | 94,949,790 | ||||||
Percentages are stated as a percent of net assets.
ADR American Depositary Receipt
| (a) | Non-income producing security. |
| (b) | Foreign issued security. |
The Global Industry Classification Standard (GICS®) was developed by and/or is the exclusive property of MSCI, Inc. and Standard & Poor’s Financial Services LLC (“S&P”). GICS® is a service mark of MSCI, Inc. and S&P and has been licensed for use by U.S. Bancorp Fund Services, LLC.
| See Notes to the Financial Statements. | The Leuthold Funds - 2018 Annual Report | 75 |
| 76 | The Leuthold Funds - 2018 Annual Report | See Notes to the Financial Statements. |
The Leuthold Funds
| 1. | ORGANIZATIONAND SIGNIFICANT ACCOUNTING POLICIES |
Leuthold Funds, Inc. (the “Company”) was incorporated on August 30, 1995, as a Maryland Corporation and is registered with the Securities and Exchange Commission as an open-end management investment company under the Investment Company Act of 1940, as amended. In addition, the Funds are considered investment companies under, and follow the accounting and reporting guidance in, Accounting Standards Codification Topic 946 – Investment Companies. Leuthold Weeden Capital Management is the investment adviser (the “Adviser”). The Company consists of five series (each series a “Fund” and collectively the “Funds”):
| Fund | Investment Objective | Inception – Retail Share Class | Inception – Institutional Share Class | |||
| Leuthold Core Investment Fund | Seeks total return consistent with prudent investment risk over the long-term | 11/20/1995 | 1/31/2006 | |||
| Leuthold Global Fund | Seeks total return consistent with prudent investment risk over the long-term | 7/1/2008 | 4/30/2008 | |||
| Leuthold Select Industries Fund | Capital appreciation | 6/19/2000 | n/a | |||
| Leuthold Global Industries Fund | Seeks capital appreciation and dividend income | 5/17/2010 | 5/17/2010 | |||
| Grizzly Short Fund | Capital appreciation | 6/19/2000 | n/a | |||
All classes of shares in a Fund have identical voting, dividend, liquidation, and other rights, and the same terms and conditions, except that certain fees and expenses, including distribution and shareholder servicing fees, may differ among classes. Each class has exclusive voting rights on any matters relating to that class’s servicing or distribution arrangements.
During the year ended September 30, 2018, shares of the Grizzly Short Fund were adjusted to reflect a reverse stock split. The effect of the reverse stock split was to reduce the number of shares outstanding while maintaining the Fund’s and each shareholder’s aggregate net asset value. A summary of the reverse stock split is as follows:
| Date | Rate | Value Before Reverse Split | Value After Reverse Split | Shares Outstanding Before Reverse Split | Shares Outstanding After Reverse Split | |
| Grizzly Short Fund | 05/18/2018 | 1:4 | 4.73 | 18.92 | 24,104,583 | 6,026,146 |
The following is a summary of significant accounting policies consistently followed by the Funds.
| a) | Investment Valuation – Securities listed on a national securities exchange (other than The NASDAQ OMX Group, Inc., referred to as “NASDAQ”) are valued at the last sale price on the day the valuation is made. Securities that are traded on NASDAQ under one of its three listing tiers, NASDAQ Global Market, NASDAQ Global Select Market, and NASDAQ Capital Market, are valued at the NASDAQ Official Closing Price. Price information on listed stocks is taken from the exchange where the security is primarily traded. Securities, including securities sold short, which are listed on an exchange but which are not traded on the valuation date are generally valued at the mean between the bid and the asked prices. |
| The Leuthold Funds - 2018 Annual Report | 77 |
The Leuthold Funds
Unlisted securities for which market quotations are readily available are valued at the latest quoted bid price or, if unavailable, at prices provided by an independent pricing service. Securities sold short which are not listed on an exchange but for which market quotations are readily available are generally valued at the average of the current bid and asked prices. Debt securities are valued at bid prices provided by an independent pricing service that may use a matrix pricing method or other analytical pricing model. Exchange-traded options are valued at the last reported sale price priced on the primary exchange on which the option is traded. If no sales are reported on a particular day, the mean between the highest bid and lowest asked quotations at the close of the exchanges is used. Non-exchange traded options are valued at the mean between the last bid and asked quotations. For options where market quotations are not readily available, the fair value shall be determined. Shares of open-end investment companies (other than shares of an exchange-traded fund traded on domestic securities exchanges or on NASDAQ) are valued at one of the following prices as determined by the Adviser: (a) the net asset value announced by such open-end investment company following the close of business on the day a Fund’s net asset value is to be calculated; (b) the net asset value announced by such open-end investment company following the close of business on the business day immediately preceding the day a Fund’s net asset value is to be calculated; or (c) a value determined by the Adviser by adding to, or subtracting from, the net asset value announced by such open-end investment company following the close of business on the business day immediately preceding the day a Fund’s net asset value is to be calculated, an amount equal to the Adviser’s estimate of the effect of changes in the market prices for the types of securities held by such investment company. Other assets, including securities for which no quotations are readily available, are valued at fair value as determined in good faith by the Board of Directors (“Directors”) pursuant to the Funds’ “Pricing and Valuation Guidelines.”
The Funds may invest in foreign securities. Foreign securities may be priced at the closing price reported on the foreign exchange on which they are principally traded. Trading in foreign securities may be completed at times that vary from the closing of the New York Stock Exchange (“NYSE”). The Directors have approved the use of their independent pricing provider’s proprietary fair value pricing model to assist in determining current valuation for foreign securities traded in markets that close prior to the NYSE. Foreign securities quoted in foreign currencies are translated into U.S. dollars at current exchange rates. Occasionally, events that affect these values and exchange rates may occur between the times at which they are determined and the closing of the NYSE. If these events materially affect the value of portfolio securities, then these securities may be valued as determined in good faith by the Directors. Some of the factors which may be considered by the Directors and the Funds’ Fair Value Pricing Committee in determining fair value are fundamental analytical data relating to the investment, the nature and duration of any restrictions on disposition, trading in similar securities of the same issuer or comparable companies, information from broker-dealers, and an evaluation of the forces that influence the market in which the securities are purchased and sold. The use of fair value pricing by a Fund may cause the net asset value of its shares to differ significantly from the net asset value that would be calculated without regard to such considerations.
| 78 | The Leuthold Funds - 2018 Annual Report |
The Leuthold Funds
| b) | Fair Valuation Measurements –The Funds have adopted fair valuation accounting standards, which establish a definition of fair value and set out a hierarchy for measuring fair value. These standards require additional disclosures about the various inputs and valuation techniques used to develop the measurements of fair value and a discussion of changes in valuation techniques and related inputs during the period. These inputs are summarized in the following three levels: |
Level 1 - Quoted prices in active markets for identical securities.
Level 2 - Other significant observable inputs (including quoted prices for similar securities, interest rates, prepayment speeds, credit risk, etc.).
Level 3 - Significant unobservable inputs (including the Funds’ own assumptions in determining the fair value of investments).
The inputs or methodology used for valuing securities are not an indication of the risk associated with investing in those securities.
The following is a summary of the inputs used to value the Funds’ investments and securities sold short as of September 30, 2018:
| Leuthold Core Investment Fund | ||||||||||||||||
| Investments at Fair Value | Level 1 | Level 2 | Level 3 | Total | ||||||||||||
| Common Stocks | ||||||||||||||||
| Biotechnology | $ | 18,453,288 | $ | — | $ | — | $ | 18,453,288 | ||||||||
| Chemicals | — | — | 6,423 | 6,423 | ||||||||||||
| Commercial Services & Supplies | 17,940,381 | — | — | 17,940,381 | ||||||||||||
| Consumer Finance | 15,911,553 | — | — | 15,911,553 | ||||||||||||
| Food & Staples Retailing | 11,606,601 | — | — | 11,606,601 | ||||||||||||
| Health Care Providers & Services | 109,185,306 | — | — | 109,185,306 | ||||||||||||
| Hotels, Restaurants & Leisure | 19,003,483 | — | — | 19,003,483 | ||||||||||||
| Household Durables | 21,440,966 | — | — | 21,440,966 | ||||||||||||
| IT Services | 69,372,576 | — | — | 69,372,576 | ||||||||||||
| Media | 8,573,097 | — | — | 8,573,097 | ||||||||||||
| Metals & Mining | 3,719,038 | — | — | 3,719,038 | ||||||||||||
| Multiline Retail | 40,851,355 | — | — | 40,851,355 | ||||||||||||
| Paper & Forest Products | 7,987,683 | — | — | 7,987,683 | ||||||||||||
| Professional Services | 27,518,060 | — | — | 27,518,060 | ||||||||||||
| Road & Rail | 33,675,925 | — | — | 33,675,925 | ||||||||||||
| Semiconductors & Semiconductor Equipment | 39,248,044 | — | — | 39,248,044 | ||||||||||||
| Specialty Retail | 32,220,898 | — | — | 32,220,898 | ||||||||||||
| Total Common Stocks | $ | 476,708,254 | $ | — | $ | 6,423 | $ | 476,714,677 | ||||||||
| Exchange Traded Funds | 106,674,566 | — | — | 106,674,566 | ||||||||||||
| Corporate Bonds | — | 25,729,705 | — | 25,729,705 | ||||||||||||
| United States Treasury Obligations | — | 49,371,234 | — | 49,371,234 | ||||||||||||
| Foreign Government Bonds | — | 31,695,518 | — | 31,695,518 | ||||||||||||
| Money Market Funds | 125,227,621 | — | — | 125,227,621 | ||||||||||||
| Investments Purchased as Securities Lending Collateral* | — | — | — | 106,078,956 | ||||||||||||
| Total Investments in Securities | $ | 708,610,441 | $ | 106,796,457 | $ | 6,423 | $ | 921,492,277 | ||||||||
| * | Certain investments that are measured at fair value using the net asset value per share (or its equivalent) practical expedient have not been categorized in the fair value hierarchy. The fair value amounts presented in the table are intended to permit reconciliation of the fair value hierarchy to the amounts presented in the Schedule of Investments. |
| The Leuthold Funds - 2018 Annual Report | 79 |
The Leuthold Funds
| Leuthold Core Investment Fund (continued) | ||||||||||||||||
| Securities Sold Short at Fair Value | Level 1 | Level 2 | Level 3 | Total | ||||||||||||
| Common Stocks | $ | 118,227,168 | $ | — | $ | — | $ | 118,227,168 | ||||||||
| Total Securities Sold Short | $ | 118,227,168 | $ | — | $ | — | $ | 118,227,168 | ||||||||
The Fund did not have any transfers into Level 1, Level 2, or Level 3 during the period. The basis for recognizing and valuing transfers is as of the end of the period in which transfers occur.
The following is a reconciliation of Level 3 investments for which significant unobservable inputs were used to determine fair value:
| Leuthold Core Investment Fund | Investment in Securities at Fair Value | |||||||||
| Balance as of September 30, 2017 | $ | 6,437 | ||||||||
| Accrued discounts/premiums | — | |||||||||
| Realized gain (loss) | — | |||||||||
| Change in unrealized depreciation | (14 | )* | ||||||||
| Purchases | — | |||||||||
| Sales | — | |||||||||
| Transfer into and/or out of Level 3 | — | |||||||||
| Balance as of September 30, 2018 | $ | 6,423 | (1) | |||||||
| Change in net unrealized depreciation during the period for Level 3 investments held at September 30, 2018: | $ | (14 | ) | |||||||
| * | Unrealized depreciation is due to a change in foreign currency exchange rate. |
(1) | The security (China Lumena New Materials Corp.) is classified as a Level 3 security due to a halt in trading of the security on March 25, 2014. The security is valued at fair value as determined in good faith by the Directors. The Adviser submits a report to the Directors setting forth the factors considered in determining the price. The significant unobservable input used in the fair valuation of this security is a discount of 95% from the last traded price of Hong Kong Dollar 1.25. Significant changes in the discount rate may result in a change in fair value measurement. For the duration of the period, the discount was 95%. |
| Leuthold Global Fund | ||||||||||||||||
| Investments at Fair Value | Level 1 | Level 2 | Level 3 | Total | ||||||||||||
| Common Stocks | ||||||||||||||||
| Chemicals | $ | 1,021,315 | $ | 1,244,729 | $ | — | $ | 2,266,044 | ||||||||
| Communications Equipment | 1,636,464 | 613,895 | — | 2,250,359 | ||||||||||||
| Consumer Finance | 1,261,624 | 494,744 | — | 1,756,368 | ||||||||||||
| Health Care Equipment & Supplies | 2,376,088 | 378,936 | — | 2,755,024 | ||||||||||||
| Health Care Providers & Services | 6,706,709 | 1,228,314 | — | 7,935,023 | ||||||||||||
| Household Durables | 1,342,194 | 1,383,834 | — | 2,726,028 | ||||||||||||
| Insurance | 823,972 | 1,825,292 | — | 2,649,264 | ||||||||||||
| IT Services | 4,457,163 | 1,626,464 | — | 6,083,627 | ||||||||||||
| Metals & Mining | 413,676 | 1,324,161 | — | 1,737,837 | ||||||||||||
| Multiline Retail | 713,003 | — | — | 713,003 | ||||||||||||
| Oil, Gas & Consumable Fuels | 4,970,303 | 3,980,682 | — | 8,950,985 | ||||||||||||
| Paper & Forest Products | 2,033,133 | 1,531,072 | 47,596 | 3,611,801 | ||||||||||||
| Semiconductors & Semiconductor Equipment | 2,434,442 | 1,315,298 | — | 3,749,740 | ||||||||||||
| Wireless Telecommunication Services | 391,128 | 1,624,546 | — | 2,015,674 | ||||||||||||
| Total Common Stocks | 30,581,214 | 18,571,967 | 47,596 | 49,200,777 | ||||||||||||
| 80 | The Leuthold Funds - 2018 Annual Report |
The Leuthold Funds
| Leuthold Global Fund (continued) | ||||||||||||||||
| Investments at Fair Value | Level 1 | Level 2 | Level 3 | Total | ||||||||||||
| Exchange Traded Funds | 8,890,060 | — | — | 8,890,060 | ||||||||||||
| Corporate Bonds | — | 1,977,371 | — | 1,977,371 | ||||||||||||
| United States Treasury Obligations | — | 4,821,272 | — | 4,821,272 | ||||||||||||
| Foreign Government Bonds | — | 4,269,867 | — | 4,269,867 | ||||||||||||
| Money Market Funds | 11,035,551 | — | — | 11,035,551 | ||||||||||||
| Investments Purchased as Securities Lending Collateral* | — | — | — | 12,218,224 | ||||||||||||
| Total Investments in Securities | $ | 50,506,825 | $ | 29,640,477 | $ | 47,596 | $ | 92,413,122 | ||||||||
| * | Certain investments that are measured at fair value using the net asset value per share (or its equivalent) practical expedient have not been categorized in the fair value hierarchy. The fair value amounts presented in the table are intended to permit reconciliation of the fair value hierarchy to the amounts presented in the Schedule of Investments. |
| Securities Sold Short at Fair Value | Level 1 | Level 2 | Level 3 | Total | ||||||||||||
| Common Stocks | $ | 5,974,219 | $ | — | $ | — | $ | 5,974,219 | ||||||||
| Exchange-Traded Funds | 5,919,339 | — | — | 5,919,339 | ||||||||||||
| Total Securities Sold Short | $ | 11,893,558 | $ | — | $ | — | $ | 11,893,558 | ||||||||
The basis for recognizing and valuing transfers is as of the end of the period in which transfers occur. The following is summary of transfers for the year ended September 30, 2018:
| Total Investments | Level 1 | Level 2 | Level 3 | |||||||||
| Transfers into: | $ | — | $ | 344,159 | $ | — | ||||||
| Transfers out of: | (344,159 | ) | — | — | ||||||||
| Net Transfers into and/or out of: | $ | (344,159 | ) | $ | 344,159 | $ | — | |||||
The transfers were due to the adjustment of fair value of certain securities due to developments that occurred between the time of the close of the foreign markets on which they trade and the close of regular session trading on the NYSE.
| The Leuthold Funds - 2018 Annual Report | 81 |
The Leuthold Funds
The following is a reconciliation of Level 3 investments for which significant unobservable inputs were used to determine fair value:
| Leuthold Global Investment Fund | Investment in Securities at Fair Value | |||||||||
| Balance as of September 30, 2017 | $ | 47,698 | ||||||||
| Accrued discounts/premiums | — | |||||||||
| Realized gain (loss) | — | |||||||||
| Change in unrealized depreciation | (102 | )* | ||||||||
| Purchases | — | |||||||||
| Sales | — | |||||||||
| Transfer into and/or out of Level 3 | — | |||||||||
| Balance as of September 30, 2018 | $ | 47,596 | (1) | |||||||
| Change in net unrealized depreciation during the period for Level 3 investments held at September 30, 2018: | $ | (102 | ) | |||||||
| * | Unrealized depreciation is due to a change in foreign currency exchange rate. |
(1) | The security (China Forestry Holdings Co., Ltd.) is classified as a Level 3 security due to a halt in trading of the security on January 26, 2011. The security is valued at fair value as determined in good faith by the Directors. The Adviser submits a report to the Directors setting forth the factors considered in determining the price. The significant unobservable input used in the fair valuation of this security is a discount of 95% from the last traded price of Hong Kong Dollar 2.95. Significant changes in the discount rate may result in a change in fair value measurement. For the duration of the period the discount was 95%. |
| Leuthold Select Industries Fund | ||||||||||||||||
| Investments at Fair Value | Level 1 | Level 2 | Level 3 | Total | ||||||||||||
| Common Stocks | $ | 18,094,589 | $ | — | $ | — | $ | 18,094,589 | ||||||||
| Money Market Funds | 52,883 | — | — | 52,883 | ||||||||||||
| Total Investments in Securities | $ | 18,147,472 | $ | — | $ | — | $ | 18,147,472 | ||||||||
The Fund did not invest in any Level 3 securities or have any transfers into or out of Level 1 or Level 2 during the period. The basis for recognizing and valuing transfers is as of the end of the period in which transfers occur.
| Leuthold Global Industries Fund | ||||||||||||||||
| Investments at Fair Value | Level 1 | Level 2 | Level 3 | Total | ||||||||||||
| Common Stocks | ||||||||||||||||
| Chemicals | $ | 207,026 | $ | 237,309 | $ | — | $ | 444,335 | ||||||||
| Communications Equipment | 332,688 | 126,195 | — | 458,883 | ||||||||||||
| Consumer Finance | 260,066 | 103,137 | — | 363,203 | ||||||||||||
| Health Care Equipment & Supplies | 482,520 | 78,945 | — | 561,465 | ||||||||||||
| Health Care Providers & Services | 1,380,987 | 252,749 | — | 1,633,736 | ||||||||||||
| Household Durables | 273,501 | 282,374 | — | 555,875 | ||||||||||||
| Insurance | 168,292 | 372,446 | — | 540,738 | ||||||||||||
| IT Services | 909,120 | 339,760 | — | 1,248,880 | ||||||||||||
| Metals & Mining | 82,915 | 268,773 | — | 351,688 | ||||||||||||
| Multiline Retail | 145,795 | — | — | 145,795 | ||||||||||||
| Oil, Gas & Consumable Fuels | 1,022,756 | 818,719 | — | 1,841,475 | ||||||||||||
| Paper & Forest Products | 413,663 | 309,319 | 2,223 | 725,205 | ||||||||||||
| 82 | The Leuthold Funds - 2018 Annual Report |
The Leuthold Funds
| Leuthold Global Industries Fund (continued) | ||||||||||||||||
| Investments at Fair Value | Level 1 | Level 2 | Level 3 | Total | ||||||||||||
| Common Stocks (continued) | ||||||||||||||||
| Semiconductors & Semiconductor Equipment | 498,025 | 273,615 | — | 771,640 | ||||||||||||
| Wireless Telecommunication Services | 83,883 | 329,457 | — | 413,340 | ||||||||||||
| Total Common Stocks | 6,261,237 | 3,792,798 | 2,223 | 10,056,258 | ||||||||||||
| Exchange Traded Funds | 317,572 | — | — | 317,572 | ||||||||||||
| Money Market Funds | 46,846 | — | — | 46,846 | ||||||||||||
| Total Investments in Securities | $ | 6,625,655 | $ | 3,792,798 | $ | 2,223 | $ | 10,420,676 | ||||||||
The basis for recognizing and valuing transfers is as of the end of the period in which transfers occur. The following is a summary of transfers for the year ended September 30, 2018:
| Total Investments | Level 1 | Level 2 | Level 3 | |||||||||||||
Transfers into: | $ | — | $ | 70,130 | $ | — | ||||||||||
Transfers out of: | (70,130 | ) | — | — | ||||||||||||
Net Transfers into and/or out of: | $ | (70,130 | ) | $ | 70,130 | $ | — | |||||||||
The transfers were due to the adjustment of fair value of certain securities due to developments that occurred between the time of the close of the foreign markets on which they trade and the close of regular session trading on the NYSE.
The following is a reconciliation of Level 3 investments for which significant unobservable inputs were used to determine fair value:
| Leuthold Global Industries Investment Fund | Investment in Securities at Fair Value | |||||||||||||||
| Balance as of September 30, 2017 | $ | 2,227 | ||||||||||||||
| Accrued discounts/premiums | — | |||||||||||||||
| Realized gain (loss) | — | |||||||||||||||
| Change in unrealized depreciation | (4 | )* | ||||||||||||||
| Purchases | — | |||||||||||||||
| Sales | — | |||||||||||||||
| Transfer into and/or out of Level 3 | — | |||||||||||||||
| Balance as of September 30, 2018 | $ | 2,223 | (1) | |||||||||||||
| Change in net unrealized depreciation during the period for Level 3 investments held at September 30, 2018: | $ | (4 | ) | |||||||||||||
| * | Unrealized depreciation is due to a change in foreign currency exchange rate. |
| (1) | The security (China Forestry Holdings Co., Ltd.) is classified as a Level 3 security due to a halt in trading of the security on January 26, 2011. The security is valued at fair value as determined in good faith by the Directors. The Adviser submits a report to the Directors setting forth the factors considered in determining the price. The significant unobservable input used in the fair valuation of this security is a discount of 95% from the last traded price of Hong Kong Dollar 2.95. Significant changes in the discount rate may result in a change in fair value measurement. For the duration of the period the discount was 95%. |
| The Leuthold Funds - 2018 Annual Report | 83 |
The Leuthold Funds
| Grizzly Short Fund | ||||||||||||||||
| Investments at Fair Value | Level 1 | Level 2 | Level 3 | Total | ||||||||||||
| Money Market Funds | $ | 81,840,809 | $ | — | $ | — | $ | 81,840,809 | ||||||||
| Total Investments in Securities | $ | 81,840,809 | $ | — | $ | — | $ | 81,840,809 | ||||||||
| Securities Sold Short at Fair Value | Level 1 | Level 2 | Level 3 | Total | ||||||||||||
| Common Stocks | $ | 94,949,790 | $ | — | $ | — | $ | 94,949,790 | ||||||||
| Total Securities Sold Short | $ | 94,949,790 | $ | — | $ | — | $ | 94,949,790 | ||||||||
The Fund did not invest in any Level 3 securities or have any transfers into or out of Level 1 or Level 2 during the period. The basis for recognizing and valuing transfers is as of the end of the period in which transfers occur.
For further information regarding security characteristics, see the Schedules of Investments and Securities Sold Short.
| c) | Federal Income Taxes – Provision for federal income taxes or excise taxes has not been made since the Funds have elected to be taxed as “regulated investment companies” and intend to distribute substantially all taxable income to shareholders and otherwise comply with the provisions of the Internal Revenue Code applicable to regulated investment companies. Distributions from net realized gains for book purposes may include short-term capital gains, which are included as ordinary income to shareholders for tax purposes. The Funds also designate as distributions of long-term gains, to the extent necessary to fully distribute such capital gains, earnings and profits distributed to shareholders on the redemption of shares. |
The tax character of distributions paid during the fiscal years ended September 30, 2018 and 2017 was as follows:
| Year Ended September 30, 2018 | ||||||||||||||||||||
Leuthold Core Investment Fund | Leuthold Global Fund | Leuthold Select Industries Fund | Leuthold Global Industries Fund | Grizzly Short Fund | ||||||||||||||||
| Distributions paid from: | ||||||||||||||||||||
| Ordinary Income | $ | 2,274,796 | $ | 3,573,894 | $ | 5,625 | $ | 436,345 | $ | — | ||||||||||
| Long-Term Capital Gain* | 26,947,936 | 5,318,043 | 735,816 | 450,496 | — | |||||||||||||||
| Return of Capital | — | — | — | — | — | |||||||||||||||
| Total Distribution Paid | $ | 29,222,732 | $ | 8,891,937 | $ | 741,441 | $ | 886,841 | $ | — | ||||||||||
| Year Ended September 30, 2017 | ||||||||||||||||||||
Leuthold Core Investment Fund | Leuthold Global Fund | Leuthold Select Industries Fund | Leuthold Global Industries Fund | �� | Grizzly Short Fund | |||||||||||||||
| Distributions paid from: | ||||||||||||||||||||
| Ordinary Income | $ | 854,085 | $ | 395,482 | $ | — | $ | 154,354 | $ | — | ||||||||||
| Long-Term Capital Gain* | 3,823,839 | 11,393,102 | — | 309,089 | — | |||||||||||||||
| Return of Capital | — | — | — | — | — | |||||||||||||||
| Total Distribution Paid | $ | 4,677,924 | $ | 11,788,584 | $ | — | $ | 463,443 | $ | — | ||||||||||
| * | The funds designate these distributions as long-term capital gain dividends per IRC Sec. 852(b)(3)(C) in the 20-percent group (which may be taxed at a 20-percent rate, a 15-percent rate or 0-percent rate, depending on the shareholder’s taxable income). |
| 84 | The Leuthold Funds - 2018 Annual Report |
The Leuthold Funds
At September 30, 2018, the components of accumulated earnings (deficit) on a tax basis were as follows:
Leuthold Core Investment Fund | Leuthold Global Fund | Leuthold Select Industries Fund | Leuthold Global Industries Fund | Grizzly Short Fund | ||||||||||||||||
| Undistributed Ordinary Income | $ | — | $ | — | $ | — | $ | 115,848 | $ | — | ||||||||||
| Undistributed long-term gains | 72,649,053 | 5,448,398 | 1,138,366 | 902,020 | — | |||||||||||||||
| Distributable earnings | 72,649,053 | 5,448,398 | 1,138,366 | 1,017,868 | — | |||||||||||||||
| Capital loss carryover and late-year losses | (332,659 | ) | (346,147 | ) | (24,117 | ) | — | (249,962,530 | ) | |||||||||||
| Other accumulated gains (losses) | (4,392 | ) | (15,423 | ) | 2 | (1,754 | ) | — | ||||||||||||
| Unrealized appreciation | 112,202,010 | 4,100,086 | 3,718,554 | 841,946 | 3,052,379 | |||||||||||||||
| Total accumulated earnings (deficit) | $ | 184,514,012 | $ | 9,186,914 | $ | 4,832,805 | $ | 1,858,060 | $ | (246,910,151 | ) | |||||||||
Net investment income and realized gains and losses for federal income tax purposes may differ from that reported on the financial statements because of permanent book-to-tax differences. U.S. Generally Accepted Accounting Principles (“U.S. GAAP”) requires that permanent differences between financial reporting and tax reporting be reclassified between various components of net assets. These differences are primarily due to partnership adjustments, securities sold short, earnings and profits distributed to shareholders on the redemption of shares, net operating losses, and expiration of capital losses.
Additionally, U.S. GAAP requires that certain components of net assets relating to permanent differences be reclassified between financial and tax reporting. These reclassifications have no effect on net assets or net asset value per share. For the year ended September 30, 2018, the following table shows the reclassifications made:
Distributable Earnings | Paid In Capital | |||||||
| Leuthold Core Investment Fund | $ | (12,787,623 | ) | $ | 12,787,623 | |||
| Leuthold Global Fund | (1,432,487 | ) | 1,432,487 | |||||
| Leuthold Select Industries Fund | (407,076 | ) | 407,076 | |||||
| Leuthold Global Industries Fund | (76,463 | ) | 76,463 | ) | ||||
| Grizzly Short Fund | 21,375,478 | (21,375,478 | ) | |||||
Under current law, the Funds may carry forward net capital losses indefinitely to use to offset capital gains realized in future years. Previous law limited the carry forward of capital losses to the eight tax years following the year the capital loss was realized. If a Fund has capital losses that are subject to current law and also has capital losses subject to prior law, the losses realized under current law will be utilized to offset capital gains before any of the losses governed by prior law can be used. As a result of these ordering rules, capital losses realized under previous law may be more likely to expire unused. Capital losses realized under current law will carry forward retaining their classification as long-term or short-term losses, whereas under prior law all capital losses were carried forward as short-term capital losses.
| The Leuthold Funds - 2018 Annual Report | 85 |
The Leuthold Funds
Leuthold Core Investment Fund | Leuthold Global Fund | Leuthold Select Industries Fund | Leuthold Global Industries Fund | Grizzly Short Fund | ||||||||||||||||
| Expires 09/30/19 | $ | — | $ | — | $ | — | $ | — | $ | (25,380,935 | ) | |||||||||
| Unlimited Short-Term | — | — | — | — | (224,310,627 | ) | ||||||||||||||
The Leuthold Core Investment Fund, Leuthold Global Fund, Leuthold Select Industries Fund, and Grizzly Short Fund intend to defer and treat $332,659, $346,147, $24,117, and $270,968, respectively, of qualified late-year losses incurred during the fiscal year ended September 30, 2018 as arising on the first day of the fiscal year ending September 30, 2019.
As of September 30, 2018, the Funds had no tax positions that did not meet the “more likely-than-not” threshold of being sustained by the applicable tax authority. Generally, tax authorities can examine all the tax returns filed for the last three years. The Funds recognize interest and penalties, if any, related to unrecognized tax benefits as income tax expense in the Statements of Operations. During the year ended September 30, 2018, the Funds did not incur any interest or penalties.
| d) | Distributions to Shareholders – Dividends from net investment income, if any, are declared and paid quarterly. Distributions of net realized capital gains, if any, are declared and paid at least annually. |
| e) | Use of Estimates – The preparation of financial statements in conformity with U.S. GAAP 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 revenues and expenses during the reporting period. Actual results could differ from those estimates. |
| f) | Basis for Consolidation for the Leuthold Core Investment Fund and Leuthold Global Fund –The Leuthold Core Investment Fund and Leuthold Global Fund may invest up to 25% of their total assets in their subsidiaries, Leuthold Core, Ltd. and Leuthold Global, Ltd. (the “Subsidiaries”), respectively. The Subsidiaries, which are organized under the laws of the Cayman Islands, are wholly owned and controlled by the Leuthold Core Investment Fund and Leuthold Global Fund, respectively, and are therefore consolidated in the respective Funds’ financial statements herein. All intercompany balances, revenues, and expenses have been eliminated in consolidation. The Subsidiaries act as investment vehicles in order to enter into certain investments for the Leuthold Core Investment Fund and Leuthold Global Fund consistent with the investment objectives and policies specified in the Prospectus and Statement of Additional Information. The Subsidiaries were liquidated in May 2018. |
| g) | Securities Sold Short – For financial statement purposes, an amount equal to the required amount of collateral to be segregated for securities sold short is included in the Statements of Assets and Liabilities as an asset. The amount of the securities sold short, shown as a liability, is subsequently marked-to-market to reflect the current value of the securities sold short. Subsequent fluctuations in the market prices of securities sold short may require purchasing the securities at prices which could differ from the amount reflected in the Statements of Assets and Liabilities. The Funds are liable for any dividends or interest payable on securities sold short. As collateral for their securities sold short, the Funds are required under the 1940 Act to maintain segregated assets consisting of cash, cash equivalents, or liquid securities. These segregated assets are valued consistent with Note 1a. The amount of segregated assets is required to be adjusted daily to reflect changes in the fair value of the securities sold short. The Leuthold Core Investment Fund, Leuthold Global Fund, and Grizzly Short Fund’s collateral at broker for securities sold short is with one major security dealer. |
| 86 | The Leuthold Funds - 2018 Annual Report |
The Leuthold Funds
| h) | Other – Investment and shareholder transactions are recorded on the trade date. The Funds determine the gain or loss realized from the investment transactions by comparing the original cost of the security lot sold with the net sales proceeds. The Funds utilize an identified lot approach to transactions. Dividend income is recognized on the ex-dividend date or as soon as information is available to the Funds, and interest income is recognized on an accrual basis. Discounts and premiums on bonds are amortized using the yield to maturity method over the life of the respective bond. For financial reporting purposes, the Funds isolate changes in the exchange rate of investment securities from the fluctuations arising from changes in the market prices of securities for realized gains and losses. |
| i) | Expenses – Expenses that directly relate to one of the Funds are charged directly to that Fund. Other operating expenses of the Funds, such as Directors’ fees and expenses, insurance expense, and legal fees are allocated between the Funds based on the relative net asset value of the individual Funds. |
| j) | Counterparty Risk – Counterparty risk may arise as the result of the failure of a counterparty to a securities contract to comply with the terms of the contract. Potential counterparty risk is measured by the creditworthiness of the counterparty and additional risk may arise from unanticipated events affecting the value of the underlying security. |
| k) | Recent Accounting Pronouncements – In August 2018, the Securities and Exchange Commission (“SEC”) released its Final Rules that eliminates or amends disclosure requirements that are redundant or outdated in light of changes in SEC requirements, US GAAP, IFRS or changes in technology or the business environment. The Rules are effective November 5, 2018, 30 days from publication in the Federal Register. |
In September 2018, the Financial Accounting Standards Board (FASB) issued Accounting Standards Update (ASU) No. 2017-08, Receivables—Nonrefundable Fees and Other Costs (Subtopic 310-20): Premium Amortization on Purchased Callable Debt Securities. The amendments in the ASU shorten the amortization period for certain callable debt securities, held at a premium, to be amortized to the earliest call date. The ASU does not require an accounting change for securities held at a discount, which continues to be amortized to maturity. The ASU is effective for fiscal years and interim periods within those fiscal years beginning after December 15, 2018. Management is currently evaluating the impact, if any, of applying this provision.
In August 2018, the FASB released an accounting standards update (ASU) 2018-13, which changes the fair value measurement disclosure requirements of Topic 820. The amendments in this ASU are the result of a broader disclosure project called FASB Concept Statement, Conceptual Framework for Financial Reporting – Chapter 8: Notes to Financial Statements. The object and primary focus of the project are to improve the effectiveness of disclosures in the notes to the financial statements by facilitating clear communication of the information required by GAAP that is most important to users of the financial statements. The ASU is effective for all entities for fiscal years beginning after December 15, 2019, including interim periods therein. Early adoption is permitted for any eliminated or modified disclosures upon issuance of the ASU. Management is currently evaluating the impact, if any, of applying this provision.
| l) | Subsequent Events – The Funds have evaluated subsequent events through the date of issuance of the Funds’ financial statements. This evaluation did not result in any subsequent events that necessitated recognition or disclosure. |
| The Leuthold Funds - 2018 Annual Report | 87 |
The Leuthold Funds
| 2. | INVESTMENT TRANSACTIONS |
Purchases and sales of investment securities, other than short-term investments and securities sold short, for the year ended September 30, 2018 are summarized below.
Leuthold Core Investment Fund | Leuthold Global Fund | Leuthold Select Industries Fund | Leuthold Global Industries Fund | |||||||||||||
| Purchases | $ | 571,078,173 | $ | 63,944,318 | $ | 21,372,813 | $ | 10,898,750 | ||||||||
| Sales | 676,626,840 | 88,198,490 | 19,343,222 | 11,424,554 | ||||||||||||
There were no purchases or sales of investment securities in the Grizzly Short Fund because this Fund invests only in securities sold short.
At September 30, 2018, gross unrealized appreciation and depreciation of investments and securities sold short and cost of investments and cost of securities sold short for tax purposes were as follows:
Leuthold Core Investment Fund | Leuthold Global Fund | Leuthold Select Industries Fund | Leuthold Global Industries Fund | Grizzly Short Fund | ||||||||||||||||
| Tax cost of Investments | $ | 691,063,099 | $ | 76,534,095 | $ | 14,428,918 | $ | 9,605,888 | $ | (16,161,360 | ) | |||||||||
| Unrealized Appreciation | 124,122,936 | 6,552,951 | 3,983,171 | 1,087,857 | 6,697,484 | |||||||||||||||
| Unrealized Depreciation | (11,920,926 | ) | (2,452,865 | ) | (264,617 | ) | (245,911 | ) | (3,645,105 | ) | ||||||||||
| Net unrealized appreciation | $ | 112,202,010 | $ | 4,100,086 | $ | 3,718,554 | $ | 841,946 | $ | 3,052,379 | ||||||||||
The differences between book and tax basis of unrealized appreciation (depreciation) are primarily attributable to the tax deferral of losses on wash sales and passive foreign investment company transactions.
The Leuthold Core Investment Fund owned 5% or more of the voting securities of the following companies during the year ended September 30, 2018. As a result, these companies are deemed to be affiliates of the Leuthold Core Investment Fund as defined by the 1940 Act. Transactions during the period in these securities of affiliated companies were as follows:
| Leuthold Core Investment Fund | ||||||||||||||||||||||||||||||||
| Share Activity | ||||||||||||||||||||||||||||||||
| Security Name | Balance 09/30/17 | Purchases | Sales | Balance 09/30/18 | Dividend Income | Fair Value at 09/30/18 | Change in Unrealized Depreciation | Realized Gain (Loss) | ||||||||||||||||||||||||
| Invesco Currency Shares | 187,794 | 99,217 | — | 287,011 | $ | — | $ | 24,151,976 | $ | (569,872 | ) | $ | — | |||||||||||||||||||
| Japanese Yen Trust | ||||||||||||||||||||||||||||||||
| 88 | The Leuthold Funds - 2018 Annual Report |
The Leuthold Funds
| 3. | INVESTMENT ADVISORY AND OTHER AGREEMENTS |
Each of the Funds has entered into an Investment Advisory Agreement (“advisory agreement”) with the Adviser. Pursuant to its advisory agreement with the Funds, the Adviser is entitled to receive a fee, calculated daily as applied to each Fund’s average daily net assets and payable monthly, at annual rates of:
Leuthold Core Investment Fund | Leuthold Global Fund | Leuthold Select Industries Fund | Leuthold Global Industries Fund | Grizzly Short Fund | ||||
| 0.90% | 0.90% | 1.00% | 1.00% | 1.25% |
The Adviser has agreed to waive its advisory fee and/or reimburse the Funds’ other expenses, to the extent necessary to ensure that the Funds’ total operating expenses (exclusive of interest, taxes, brokerage commissions, dividends and interest on securities sold short, and extraordinary items) do not exceed the following rates, based on each Fund’s average daily net assets:
Leuthold Core Investment Fund | Leuthold Global Fund | Leuthold Select Industries Fund | Leuthold Global Industries Fund Retail Class | Leuthold Global Industries Fund Institutional Class | Grizzly Short Fund | |||||
| 1.25% | 1.85% | 1.50% | 1.50% | 1.25% | 2.50% |
Any waiver or reimbursement is subject to later adjustments to allow the Adviser to recoup amounts previously waived or reimbursed to the extent actual fees and expenses for a fiscal period are less than each Fund’s expense limitation, provided, however, that the Adviser shall only be entitled to recoup such amounts for a period of three fiscal years from the date such amount was waived or reimbursed.
Amounts subject to future recoupment as of September 30, 2018 are as follows:
| Leuthold Select Industries Fund | Leuthold Global Industries Fund | |||||
| Year of Expiration | Recoverable Amount | Year of Expiration | Recoverable Amount | |||
| 9/30/2019 | $ 29,664 | 9/30/2019 | $ 127,058 | |||
| 9/30/2020 | 40,903 | 9/30/2020 | 122,114 | |||
| 9/30/2021 | 28,151 | 9/30/2021 | 121,088 | |||
U.S. Bancorp Fund Services, LLC (“Fund Services”), doing business as U.S. Bank Global Fund Services, serves as transfer agent, administrator, and accounting services agent for the Funds. U.S. Bank, N.A. serves as custodian for the Funds.
| The Leuthold Funds - 2018 Annual Report | 89 |
The Leuthold Funds
| 4. | DISTRIBUTION PLAN |
The Leuthold Global Fund – Retail Class and Leuthold Global Industries Fund – Retail Class have adopted a distribution plan pursuant to Rule 12b-1 under the 1940 Act, whereby Rafferty Capital Markets, LLC serves as distributor. This plan allows each Fund to use up to 0.25% of its average daily net assets to pay sales, distribution, and other fees for the sale of its shares and for services provided to investors. Each Fund may pay all or a portion of this fee to any securities dealer, financial institution, or any other person who renders personal service to the Funds’ shareholders, assists in the maintenance of the Funds’ shareholder accounts, or who renders assistance in distributing or promoting the sale of shares of the Fund pursuant to a written agreement approved by the Directors. To the extent such fee is not paid to such persons, each of the Funds may use the fee for its expenses of distribution of its shares, including, but not limited to, payment by the Fund of the cost of preparing, printing, and distributing Prospectuses and Statements of Additional Information to prospective investors and of implementing and operating the plan.
| 5. | SUB-TRANSFER AGENT & SHAREHOLDER SERVICING FEE PLANS |
The Funds are permitted to pay sub-transfer agent fees for various platform agreements not to exceed 0.15% of the Funds’ average daily net assets. In addition, the Retail Class shares of the Leuthold Core Investment Fund, Leuthold Select Industries Fund, and Grizzly Short Fund have adopted a Shareholder Servicing Fee Plan not to exceed 0.15% of these Funds’ Retail Class shares average daily net assets. These fees are used to finance certain activities related to servicing and maintaining shareholder accounts. Sub-transfer agent and shareholder servicing fees incurred by the Funds are disclosed in the Statements of Operations.
| 6. | INDEMNIFICATIONS |
The Funds enter into contracts that contain a variety of indemnifications. The Funds’ maximum exposure under these arrangements is unknown. However, the Funds have not had prior claims or losses pursuant to these contracts and expect the risk of loss to be remote.
| 7. | ILLIQUID SECURITIES |
Each Fund may invest up to 15% of net assets in illiquid investments. An “illiquid investment” is any investment that a Fund reasonably expects cannot be sold or disposed of in current market conditions in seven calendar days or less without the sale or disposition significantly changing the market value of the investment. A Fund will take into account relevant market, trading and investment specific considerations when determining whether an investment is an illiquid investment. The illiquidity status of an investment is generally evaluated monthly. The 15% limitation may include securities whose disposition would be subject to legal restrictions (“restricted securities”). Restricted securities often have a market value lower than the market price of unrestricted securities of the same issuer and are not readily marketable without some time delay. This could result in a Fund being unable to realize a favorable price upon disposition of restricted securities and in some cases might make disposition of such securities at the time desired by the Fund impossible.
| 90 | The Leuthold Funds - 2018 Annual Report |
The Leuthold Funds
| 8. | LENDING PORTFOLIO SECURITIES |
The Funds may lend portfolio securities constituting up to 30% of total assets to unaffiliated broker-dealers, banks, or other recognized institutional borrowers of securities, provided that the borrower at all times maintains cash, U.S. government securities, or equivalent collateral or provides an irrevocable letter of credit in favor of the Funds equal in value to at least 100% of the value of the securities loaned. During the time portfolio securities are on loan, the borrower pays the lending Fund an amount equivalent to any dividends or interest paid on such securities, and the Fund may receive an agreed-upon amount of interest income from the borrower who delivered equivalent collateral or provided a letter of credit. Loans are subject to termination at the option of the lending Fund or the borrower. The lending Fund may pay reasonable administrative and custodial fees in connection with a loan of portfolio securities and may pay a negotiated portion of the interest earned on the cash or equivalent collateral to the borrower or placing broker. The lending Fund does not have the right to vote securities on loan, but could terminate the loan and regain the right to vote if that were considered important with respect to the investment.
The primary risk in securities lending is a default by the borrower during a sharp rise in price of the borrowed security resulting in a deficiency in the collateral posted by the borrower. The Funds will seek to minimize this risk by requiring that the value of the securities loaned will be computed each day and additional collateral be furnished each day if required.
As of September 30, 2018, the market value of the securities on loan and payable on collateral received for securities lending were as follows:
| Market Value of Securities on Loan | Payable on Collateral Received | |||||||||
| Leuthold Core Investment Fund | $ | 103,836,535 | $ | 106,078,956 | ||||||
| Leuthold Global Fund | 11,900,632 | 12,218,224 | ||||||||
| The Leuthold Funds - 2018 Annual Report | 91 |
The Leuthold Funds
To the Shareholders and Board of Directors
Leuthold Funds, Inc.
Leuthold Funds, Inc.
Opinion on the Financial Statements
We have audited the accompanying statements of assets and liabilities, including the schedules of investments and securities sold short (as applicable), of Leuthold Funds, Inc., comprising Leuthold Core Investment Fund (consolidated), Leuthold Global Fund (consolidated), Leuthold Select Industries Fund, Leuthold Global Industries Fund, and Grizzly Short Fund (collectively, the“Funds”), as of September 30, 2018, and the related statements of operations for the year then ended, the statements of changes in net assets for each of the two years in the period then ended, the financial highlights for each of the five years in the period then ended and the related notes (collectively referred to as the“financial statements”). In our opinion, the financial statements present fairly, in all material respects, the financial position of the Funds at September 30, 2018, the results of their operations for the year then ended, the changes in their 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 U.S. generally accepted accounting principles.
Basis for Opinion
These financial statements and financial highlights are the responsibility of the Funds’ management. Our responsibility is to express an opinion on each of the Funds’ financial statements and financial highlights 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 Funds 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 and financial highlights are free of material misstatement, whether due to error or fraud. The Funds are not required to have, nor were we engaged to perform, an audit of the Funds’ internal control over financial reporting. As part of our audits we are required to obtain an understanding of internal control over financial reporting but not for the purpose of expressing an opinion on the effectiveness of the Funds’ internal control over financial reporting. Accordingly, we express no such opinion.
Our audits include performing procedures to assess the risks of material misstatement of the financial statements and financial highlights, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures include examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements. Our procedures included confirmation of securities owned as of September 30, 2018, by correspondence with the custodians. Out 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 and financial highlights. We believe that our audits provide a reasonable basis for our opinion.
We have served as the Funds’ auditor since 2002.
Minneapolis, Minnesota
November 21, 2018
November 21, 2018
| 92 | The Leuthold Funds - 2018 Annual Report |
SHAREHOLDER NOTIFICATION OF FEDERAL TAX STATUS (Unaudited)
The percentage of dividend income distributed for the year ended September 30, 2018, which is designated as qualified dividend income under the Jobs and Growth Tax Relief Reconciliation Act of 2003, is as follows: Leuthold Core Investment Fund 100.00%, Leuthold Global Fund 51.68%, Leuthold Select Industries Fund 100.00%, and Leuthold Global Industries Fund 37.51%.
The percentage of dividend income distributed for the year ended September 30, 2018, designated as qualified dividends received deduction available to corporate shareholders, is as follows: Leuthold Core Investment Fund 100.00%, Leuthold Global Fund 23.77%, Leuthold Select Industries Fund 100.00%, and Leuthold Global Industries Fund 12.24%.
The Leuthold Core Investment Fund, Leuthold Global Fund, Leuthold Select Industries Fund, and Leuthold Global Industries Fund designated 25.65%, 3.43%, 0.97%, and 0.09%, respectively, of their ordinary distributions paid as qualified interest related dividends under the Internal Revenue Code Section 871(k)(1)(C) for the year ended September 30, 2018. The Leuthold Global Fund and Leuthold Global Industries Fund designated 88.67% and 77.87%, respectively, of their ordinary distributions paid as short-term capital gain distributions under Internal Revenue Section 871(k)(2)(C) for the year ended September 30, 2018.
| The Leuthold Funds - 2018 Annual Report | 93 |
The Leuthold Funds
Independent Directors
Name, Year of Birth, and Address | Position(s) Held with the Company | Term of Office and Length of Time Served | Principal Occupation(s) During Past Five Years | # of Portfolios in Fund Complex Overseen By Director | Other Directorships Held by Director | |||||
Lawrence L. Horsch (1934) c/o Leuthold Weeden Capital Management 150 South Fifth Street Suite 1700 Minneapolis, MN 55402 | Chairman and Director | Indefinite, Director since 1995 | Chairman, Eagle Management & Financial Corp., a management consulting firm | 5 | None | |||||
| Paul M. Kelnberger (1943) c/o Leuthold Weeden Capital Management 150 South Fifth Street Suite 1700 Minneapolis, MN 55402 | Director and Chair of Audit Committee | Indefinite, Director since 1995 | Retired Partner of Johnson, West & Co., PLC (currently Boeckermann, Grafstrom & Mayer, LLC) Certified Public Accountants | 5 | None | |||||
| Addison L. Piper (1946) c/o Leuthold Weeden Capital Management 150 South Fifth Street Suite 1700 Minneapolis, MN 55402 | Director and Chair of Nominating Committee | Indefinite, Director since 2009 | Retired Chairman and Chief Executive Officer of Piper Jaffray Companies and PREDEX. | 5 | Piper Jaffray Companies and PREDEX |
| 94 | The Leuthold Funds - 2018 Annual Report |
The Leuthold Funds
ADDITIONAL DISCLOSURE REGARDING FUND DIRECTORS AND OFFICERS (UNAUDITED)
Interested Persons
Name, Year of Birth, and Address | Position(s) Held with the Company | Term of Office and Length of Time Served | Principal Occupation During Past Five Years | # of Portfolios in Fund Complex Overseen By Director | Other Directorships Held by Director | |||||
John C. Mueller (1968) 150 South Fifth Street Suite 1700 Minneapolis, MN 55402 | Director President | Indefinite, Director since 2009 One year term, President since 2011 | Co-Chief Executive Officer of The Leuthold Group since 2005. Involved in Sales and Marketing for The Leuthold Group since 2001. | 5 | None | |||||
| Holly J. Weiss (1968) 150 South Fifth Streett Suite 1700 Minneapolis, MN 55402 | Secretary and Treasurer | One Year Term, Secretary and Treasurer since 2009 | Chief Financial Officer of the Adviser since 2011 and Controller of the Adviser from 2008 to 2011. | N/A | N/A | |||||
| Roger A. Peters (1960) 150 South Fifth Street Suite 1700 Minneapolis, MN 55402 | Vice President and Chief Compliance Officer and Anti-Money Laundering Officer | One Year Term, Chief Compliance Officer since 2006 and Vice President since 2007 and Anti-Money Laundering Officer since 2011 | Chief Compliance Officer of the Adviser since 2005. | N/A | N/A | |||||
| Glenn R. Larson (1965) 150 South Fifth Street Suite 1700 Minneapolis, MN 55402 | Assistant Secretary | One Year Term, Assistant Secretary since 2006 | Compliance Officer of the Adviser since 2005. | N/A | N/A |
The Statement of Additional Information includes additional information about the Funds’ Directors and is available free of charge upon request by calling the Funds toll free at (800) 273-6886.
Information regarding the method the Funds use to vote proxies relating to portfolio securities is available without charge upon request by calling toll-free at (800) 273-6886 or by accessing the Funds’ website at www.leutholdfunds.com. Information regarding how the Funds voted proxies relating to portfolio securities during the most recent twelve-month period ended June 30 is available without charge upon request by calling toll-free at (800) 273-6886 or on the SEC’s website at www.sec.gov.
| The Leuthold Funds - 2018 Annual Report | 95 |
| The Leuthold Funds | ||
| Investment Adviser: | ||
| Leuthold Weeden Capital Management, | ||
| Minneapolis, Minnesota | ||
| Administrator, Transfer Agent, | ||
| Fund Accountant, | ||
| Shareholder Servicing Agent: | ||
| U.S. Bancorp Fund Services, LLC, | ||
| Milwaukee, Wisconsin | ||
| Custodian: | ||
| U.S. Bank, N.A., | ||
| Milwaukee, Wisconsin | ||
| Counsel: | ||
| Foley & Lardner, LLP, | ||
| Milwaukee, Wisconsin | ||
| Independent Registered | ||
| Public Accounting Firm: | ||
| Ernst & Young LLP, | ||
| Minneapolis, Minnesota | ||
The Funds are required to file their complete schedules of portfolio holdings with the SEC for their first and third fiscal quarters on Form N-Q. Once filed, the Fund’s Form N-Q is available without charge, upon request on the SEC’s website (http://www.sec.gov) and may be available by calling 1-800-273-6886. You can also obtain copies of Form N-Q by (i) visiting the SEC’s Public Reference Room in Washington, DC (information on the operation of the Public Reference Room may be obtained by calling 1-800-SEC-0330); (ii) sending your request and a duplicating fee to the SEC’s Public Reference Room, Washington, DC 20549-0102; or (iii) sending your request electronically to publicinfosec.gov. | ||
| This report is authorized for distribution only when preceded or accompanied by a current prospectus. |
Item 2. Code of Ethics.
The registrant has adopted a code of ethics that applies to the registrant’s principal executive officer and principal financial officer. The registrant has not made any amendments to its code of ethics during the period covered by this report. The registrant has not granted any waivers from any provisions of the code of ethics during the period covered by this report. A copy of the registrant’s Code of Ethics is filed herewith.
Item 3. Audit Committee Financial Expert.
The registrant’s board of directors has determined that there is at least one audit committee financial expert serving on its audit committee. Paul Kelnberger is the “audit committee financial expert” and is considered to be “independent” as each term is defined in Item 3 of Form N-CSR.
Item 4. Principal Accountant Fees and Services.
The registrant has engaged its principal accountant to perform audit services, audit-related services, tax services and other services during the past two fiscal years. “Audit services” refer to performing an audit of the registrant's annual financial statements or services that are normally provided by the accountant in connection with statutory and regulatory filings or engagements for those fiscal years. “Audit-related services” refer to the assurance and related services by the principal accountant that are reasonably related to the performance of the audit. “Tax services” refer to professional services rendered by the principal accountant for tax compliance, tax advice, and tax planning. No “other services” were provided by the principal accountant. The following table details the aggregate fees billed or expected to be billed for each of the last two fiscal years for audit fees, audit-related fees, tax fees and other fees by the principal accountant.
| FYE 9/30/2018 | FYE 9/30/2017 | |
| Audit Fees | $210,900 | $206,000 |
| Audit-Related Fees | $0 | $0 |
| Tax Fees | $15,100 | $14,800 |
| All Other Fees | $0 | $0 |
The audit committee has adopted pre-approval policies and procedures that require the audit committee to pre-approve all audit and non-audit services of the registrant, including services provided to any entity affiliated with the registrant.
The percentage of fees billed by Ernst & Young, LLP applicable to non-audit services pursuant to waiver of pre-approval requirement were as follows:
| FYE 9/30/2018 | FYE 9/30/2017 | |
| Audit-Related Fees | 0% | 0% |
| Tax Fees | 0% | 0% |
| All Other Fees | 0% | 0% |
All of the principal accountant’s hours spent on auditing the registrant’s financial statements were attributed to work performed by full-time permanent employees of the principal accountant. (If more than 50 percent of the accountant’s hours were spent to audit the registrant's financial statements for the most recent fiscal year, state how many hours were attributed to work performed by persons other than the principal accountant's full-time, permanent employees.)
The following table indicates the non-audit fees billed or expected to be billed by the registrant’s accountant for services to the registrant and to the registrant’s investment adviser (and any other controlling entity, etc.—not sub-adviser) for the last two years. The audit committee of the board of directors has considered whether the provision of non-audit services that were rendered to the registrant's investment adviser is compatible with maintaining the principal accountant's independence and has concluded that the provision of such non-audit services by the accountant has not compromised the accountant’s independence.
| Non-Audit Related Fees | FYE 9/30/2018 | FYE 9/30/2017 |
| Registrant | $ 0 | $ 0 |
| Registrant’s Investment Adviser | $ 0 | $ 0 |
Item 5. Audit Committee of Listed Registrants.
Not applicable to registrants who are not listed issuers (as defined in Rule 10A-3 under the Securities Exchange Act of 1934).
Item 6. Investments.
Schedule of Investments is included as part of the report to shareholders filed under Item 1 of this Form.
Item 7. Disclosure of Proxy Voting Policies and Procedures for Closed-End Management Investment Companies.
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 Management Investment Company and Affiliated Purchasers.
Not applicable to open-end investment companies.
Item 10. Submission of Matters to a Vote of Security Holders.
Not Applicable.
Item 11. Controls and Procedures.
| (a) | The Registrant’s President and Treasurer have reviewed the Registrant's disclosure controls and procedures (as defined in Rule 30a-3(c) under the Investment Company Act of 1940 (the “Act”)) as of a date within 90 days of the filing of this report, as required by Rule 30a-3(b) under the Act and Rules 13a-15(b) or 15d-15(b) under the Securities Exchange Act of 1934. Based on their review, such officers have concluded that the disclosure controls and procedures are effective in ensuring that information required to be disclosed in this report is appropriately recorded, processed, summarized and reported and made known to them by others within the Registrant and by the Registrant’s service provider. |
| (b) | There were no changes in the Registrant's internal control over financial reporting (as defined in Rule 30a-3(d) under the Act) that occurred during the second fiscal quarter of the period covered by this report that has materially affected, or is 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) Any code of ethics or amendment thereto, that is subject of the disclosure required by Item 2, to the extent that the registrant intends to satisfy Item 2 requirements through filing an exhibit. Incorporated by reference to previous Form N-CSR filing, filed December 8, 2008. |
(2) A separate certification for each principal executive and principal financial officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002. Filed herewith.
(3) Any written solicitation to purchase securities under Rule 23c‑1 under the Act sent or given during the period covered by the report by or on behalf of the registrant to 10 or more persons. Not applicable to open-end investment companies.
| (b) | Certifications pursuant to Section 906 of the Sarbanes‑Oxley Act of 2002. Furnished 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) Leuthold Funds, Inc.
By (Signature and Title)* /s/ John Mueller
John Mueller, President
Date December 4, 2018
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/ John Mueller
John Mueller, President
Date December 4, 2018
By (Signature and Title)* /s/ Holly Weiss
Holly Weiss, Treasurer
Date December 4, 2018
* Print the name and title of each signing officer under his or her signature.