UNITED STATES | ||
SECURITIES AND EXCHANGE COMMISSION | ||
Washington, D.C. 20549 | ||
FORM N-CSR | ||
CERTIFIED SHAREHOLDER REPORT OF REGISTERED | ||
MANAGEMENT INVESTMENT COMPANIES | ||
Investment Company Act file number | 811-21591 | |
AMERICAN CENTURY ASSET ALLOCATION PORTFOLIOS, INC. | ||
(Exact name of registrant as specified in charter) | ||
4500 MAIN STREET, KANSAS CITY, MISSOURI | 64111 | |
(Address of principal executive offices) | (Zip Code) | |
CHARLES A. ETHERINGTON | ||
4500 MAIN STREET, KANSAS CITY, MISSOURI 64111 | ||
(Name and address of agent for service) | ||
Registrant’s telephone number, including area code: | 816-531-5575 | |
Date of fiscal year end: | 07-31 | |
Date of reporting period: | 07-31-2009 | |
ITEM 1. REPORTS TO STOCKHOLDERS.
Annual Report | July 31, 2009 |
LIVESTRONG® Portfolios from | |
American Century Investments® |
LIVESTRONG® Income Portfolio
LIVESTRONG® 2015 Portfolio
LIVESTRONG® 2020 Portfolio
LIVESTRONG® 2025 Portfolio
LIVESTRONG® 2030 Portfolio
LIVESTRONG® 2035 Portfolio
LIVESTRONG® 2040 Portfolio
LIVESTRONG® 2045 Portfolio
LIVESTRONG® 2050 Portfolio
President’s Letter |
Dear Investor:
Thank you for investing with us during the financial reporting period ended July 31, 2009. We appreciate your trust in American Century Investments® during these challenging times.
The U.S. economy continued to struggle at the close of the reporting period, part of the lingering fallout from the subprime-initiated credit and financial crises and global recession that shook the capital markets during the past two years. The recession has affected everyone—from first-time individual investors to hundred-year-old financial institutions.
However, as we mark the second anniversary of the start of the subprime mortgage meltdown, the worst of the economic and financial market obstacles appear to be behind us. The rate of U.S. economic decline has slowed, as have the drop-offs in housing prices and jobs. Risk appetites returned to the markets in recent months, evidenced by the strong stock rebound since early March.
Risk was a predominant theme during the reporting period, as the investment pendulum swung from risk avoidance to risk acceptance. We believe, however, that caution and risk management are still advisable. We don’t think we’re out of the economic woods yet, not with mortgage and corporate default rates on the rise, housing prices continuing to decline in some regions, and job losses still mounting.
Effective risk management requires a commitment to disciplined investment approaches that balance risk and reward, with the goal of setting and maintaining risk levels that are appropriate for portfolio objectives. At American Century Investments, we’ve stayed true to the principles that have guided us for over 50 years, including our commitment to delivering superior investment performance and helping investors reach their financial goals. Risk management is part of that commitment—we offer portfolios that can help diversify and stabilize investment returns.
The coming months will likely present additional challenges, but I’m certain that we have the investment professionals and processes in place to provide competitive and compelling long-term results for you. Thank you for your continued confidence in us.
Sincerely,
![](https://capedge.com/proxy/N-CSR/0001467105-09-000019/cl-ann66295x2x2.jpg)
Jonathan S. Thomas
President and Chief Executive Officer
American Century Investments
Independent Chairman’s Letter |
I am Don Pratt, an independent director and chairman of the mutual fund board responsible for the U.S. Growth Equity, U.S. Value Equity, Global and Non-U.S. Equity and Asset Allocation funds managed by American Century Investments. The board consists of seven independent directors and two directors who are affiliated with the investment advisor.
As one of your independent shareholder representatives on the fund board, I plan to write you from time to time with updates on board activities and news about your funds. My co-independent directors and I are committed to putting your interests first. We work closely with American Century Investments on maintaining strong fund performance, providing quality service to shareholders at competitive fees and ensuring ethical business practices and compliance with all applicable fund regulations.
Last year, the board welcomed its newest independent director, John R. Whitten. He is a great addition to an experienced board where, collectively, the independent directors have served the funds for more than 76 years. This continuity served shareholders well as the investment advisor initiated a successful management transition, creating a strong senior leadership team consisting of well-tenured company executives and experienced industry veterans. Under the leadership of President and Chief Executive Officer Jonathan Thomas and Chief Investment Officer Enrique Chang, the firm has made the achievement of superior investment performance its primary focus and the key driver of its success going forward. This focus helped the company generate strong relative performance against the backdrop of 2008’s unprecedented market volatility.
As investors in the American Century funds, my fellow directors and I share your investing experience. We know firsthand how decisions made at the board level affect all shareholders. To further guide our efforts on your behalf, I invite you to send me your comments, questions or suggestions by email to dhpratt@fundboardchair.com. Thank you for allowing me to serve as your advocate on our board.
![](https://capedge.com/proxy/N-CSR/0001467105-09-000019/cl-ann66295x3x2.jpg)
Table of Contents |
LIVESTRONG® Portfolios from American Century Investments | |
Performance | 2 |
Portfolio Commentary | 13 |
Market Index Total Returns | 13 |
Underlying Fund Allocations | 15 |
Shareholder Fee Examples | 18 |
Financial Statements | |
Schedule of Investments | 24 |
Statement of Assets and Liabilities | 29 |
Statement of Operations | 32 |
Statement of Changes in Net Assets | 35 |
Notes to Financial Statements | 40 |
Financial Highlights | 62 |
Report of Independent Registered Public Accounting Firm | 98 |
Other Information | |
Management | 99 |
Approval of Management Agreements | 102 |
Additional Information | 108 |
Index Definitions | 109 |
American Century Investment Services, Inc., has entered into an agreement with the Lance Armstrong Foundation for rights to use the LIVESTRONG name. For more information about the foundation, visit www.livestrong.org.
The opinions expressed in the Portfolio Commentary reflect those of the portfolio management team as of the date of the report, and do not necessarily represent the opinions of American Century Investments or any other person in the American Century Investments organization. Any such opinions are subject to change at any time based upon market or other conditions and American Century Investments disclaims any responsibility to update such opinions. These opinions may not be relied upon as investment advice and, because investment decisions made by American Century Investments funds are based on numerous factors, may not be relied upon as an indication of trading intent on behalf of any American Century Investments fund. Security examples are used for representational purposes only and are not intended as recommendations to purchase or sell securities. Performance information for comparative indices and securities is pr ovided to American Century Investments by third party vendors. To the best of American Century Investments’ knowledge, such information is accurate at the time of printing.
Performance |
LIVESTRONG Portfolios | |||
Total Returns as of July 31, 2009 | |||
Average Annual | |||
Returns | |||
Since | Inception | ||
1 year | Inception | Date | |
LIVESTRONG Income Portfolio | |||
Investor Class | -6.44% | 2.93% | 8/31/04 |
Russell 3000 Index(1) | -20.21% | 0.34% | — |
Citigroup US Broad Investment-Grade Bond Index | 8.63% | 5.13% | — |
Institutional Class | -6.25% | 3.14% | 8/31/04 |
Advisor Class | -6.67% | 2.68% | 8/31/04 |
R Class | -6.91% | 2.41% | 8/31/04 |
LIVESTRONG 2015 Portfolio | |||
Investor Class | -8.63% | 3.52% | 8/31/04 |
Russell 3000 Index(1) | -20.21% | 0.34% | — |
Citigroup US Broad Investment-Grade Bond Index | 8.63% | 5.13% | — |
Institutional Class | -8.42% | 3.74% | 8/31/04 |
Advisor Class | -8.79% | 3.27% | 8/31/04 |
R Class | -9.12% | 3.00% | 8/31/04 |
(1) Data provided by Lipper Inc. — A Reuters Company. © 2009 Reuters. All rights reserved. Any copying, republication or redistribution of Lipper | |||
content, including by caching, framing or similar means, is expressly prohibited without the prior written consent of Lipper. Lipper shall not be | |||
liable for any errors or delays in the content, or for any actions taken in reliance thereon. | |||
The data contained herein has been obtained from company reports, financial reporting services, periodicals and other resources believed to be | |||
reliable. Although carefully verified, data on compilations is not guaranteed by Lipper and may be incomplete. No offer or solicitations to buy or | |||
sell any of the securities herein is being made by Lipper. |
The Russell 3000 Index represents approximately 98% of the investable U.S. equity market and provides a broad measure of equity performance. The Citigroup US Broad Investment-Grade Bond Index represents the U.S. investment-grade fixed-rate bond market and provides a broad measure of bond market performance. Performance for these indices is provided for reference only. Neither index is intended to represent the composition of the portfolio, which invests in a mix of equity and fixed-income securities. (See the Schedule of Investments for each LIVESTRONG Portfolio’s asset allocations as of July 31, 2009.)
Data presented reflect past performance. Past performance is no guarantee of future results. Current performance may be higher or lower than the performance shown. Investment return and principal value will fluctuate, and redemption value may be more or less than original cost. To obtain performance data current to the most recent month end, please call 1-800-345-2021 or visit americancentury.com. The performance of LIVESTRONG Portfolios is dependent on the performance of their underlying American Century Investments funds, and will assume the risks associated with these funds. The risks will vary according to each LIVESTRONG Portfolio’s asset allocation, and a fund with a later target date is expected to be more volatile than one with an earlier target date. International investing involves special risks, such as political instability and currency fluctuations. Investing in emerging markets may accentuate these risks. As interest rates rise, bond values will decline.
Unless otherwise indicated, performance reflects Investor Class shares; performance for other share classes will vary due to differences in fee structure. For information about other share classes available, please consult the prospectus. Data assumes reinvestment of dividends and capital gains, and none of the charts reflect the deduction of taxes that a shareholder would pay on fund distributions or the redemption of fund shares. Returns for the indices are provided for comparison. The fund’s total returns include operating expenses (such as administrative fees) that reduce returns, while the total returns of the indices do not.
2
LIVESTRONG Portfolios | |||
Total Returns as of July 31, 2009 | |||
Average Annual | |||
Returns | |||
Since | Inception | ||
1 year | Inception | Date | |
LIVESTRONG 2020 Portfolio | |||
Investor Class | -9.38% | -12.10% | 5/30/08 |
Russell 3000 Index(1) | -20.21% | -23.94% | — |
Citigroup US Broad Investment-Grade Bond Index | 8.63% | 7.38% | — |
Institutional Class | -9.26% | -11.92% | 5/30/08 |
Advisor Class | -9.72% | -12.38% | 5/30/08 |
R Class | -9.96% | -12.58% | 5/30/08 |
LIVESTRONG 2025 Portfolio | |||
Investor Class | -11.64% | 3.47% | 8/31/04 |
Russell 3000 Index(1) | -20.21% | 0.34% | — |
Citigroup US Broad Investment-Grade Bond Index | 8.63% | 5.13% | — |
Institutional Class | -11.45% | 3.67% | 8/31/04 |
Advisor Class | -11.89% | 3.19% | 8/31/04 |
R Class | -12.12% | 2.95% | 8/31/04 |
(1) Data provided by Lipper Inc. — A Reuters Company. © 2009 Reuters. All rights reserved. Any copying, republication or redistribution of Lipper | |||
content, including by caching, framing or similar means, is expressly prohibited without the prior written consent of Lipper. Lipper shall not be | |||
liable for any errors or delays in the content, or for any actions taken in reliance thereon. | |||
The data contained herein has been obtained from company reports, financial reporting services, periodicals and other resources believed to be | |||
reliable. Although carefully verified, data on compilations is not guaranteed by Lipper and may be incomplete. No offer or solicitations to buy or | |||
sell any of the securities herein is being made by Lipper. |
The Russell 3000 Index represents approximately 98% of the investable U.S. equity market and provides a broad measure of equity performance. The Citigroup US Broad Investment-Grade Bond Index represents the U.S. investment-grade fixed-rate bond market and provides a broad measure of bond market performance. Performance for these indices is provided for reference only. Neither index is intended to represent the composition of the portfolio, which invests in a mix of equity and fixed-income securities. (See the Schedule of Investments for each LIVESTRONG Portfolio’s asset allocations as of July 31, 2009.)
Data presented reflect past performance. Past performance is no guarantee of future results. Current performance may be higher or lower than the performance shown. Investment return and principal value will fluctuate, and redemption value may be more or less than original cost. To obtain performance data current to the most recent month end, please call 1-800-345-2021 or visit americancentury.com. The performance of LIVESTRONG Portfolios is dependent on the performance of their underlying American Century Investments funds, and will assume the risks associated with these funds. The risks will vary according to each LIVESTRONG Portfolio’s asset allocation, and a fund with a later target date is expected to be more volatile than one with an earlier target date. International investing involves special risks, such as political instability and currency fluctuations. Investing in emerging markets may accentuate these risks. As interest rates rise, bond values will decline.
Unless otherwise indicated, performance reflects Investor Class shares; performance for other share classes will vary due to differences in fee structure. For information about other share classes available, please consult the prospectus. Data assumes reinvestment of dividends and capital gains, and none of the charts reflect the deduction of taxes that a shareholder would pay on fund distributions or the redemption of fund shares. Returns for the indices are provided for comparison. The fund’s total returns include operating expenses (such as administrative fees) that reduce returns, while the total returns of the indices do not.
3
LIVESTRONG Portfolios | |||
Total Returns as of July 31, 2009 | |||
Average Annual | |||
Returns | |||
Since | Inception | ||
1 year | Inception | Date | |
LIVESTRONG 2030 Portfolio | |||
Investor Class | -13.30% | -16.12% | 5/30/08 |
Russell 3000 Index(1) | -20.21% | -23.94% | — |
Citigroup US Broad Investment-Grade Bond Index | 8.63% | 7.38% | — |
Institutional Class | -13.18% | -15.95% | 5/30/08 |
Advisor Class | -13.53% | -16.31% | 5/30/08 |
R Class | -13.76% | -16.50% | 5/30/08 |
LIVESTRONG 2035 Portfolio | |||
Investor Class | -15.54% | 3.12% | 8/31/04 |
Russell 3000 Index(1) | -20.21% | 0.34% | — |
Citigroup US Broad Investment-Grade Bond Index | 8.63% | 5.13% | — |
Institutional Class | -15.34% | 3.34% | 8/31/04 |
Advisor Class | -15.77% | 2.87% | 8/31/04 |
R Class | -15.92% | 2.62% | 8/31/04 |
(1) Data provided by Lipper Inc. — A Reuters Company. © 2009 Reuters. All rights reserved. Any copying, republication or redistribution of Lipper | |||
content, including by caching, framing or similar means, is expressly prohibited without the prior written consent of Lipper. Lipper shall not be | |||
liable for any errors or delays in the content, or for any actions taken in reliance thereon. | |||
The data contained herein has been obtained from company reports, financial reporting services, periodicals and other resources believed to be | |||
reliable. Although carefully verified, data on compilations is not guaranteed by Lipper and may be incomplete. No offer or solicitations to buy or | |||
sell any of the securities herein is being made by Lipper. |
The Russell 3000 Index represents approximately 98% of the investable U.S. equity market and provides a broad measure of equity performance. The Citigroup US Broad Investment-Grade Bond Index represents the U.S. investment-grade fixed-rate bond market and provides a broad measure of bond market performance. Performance for these indices is provided for reference only. Neither index is intended to represent the composition of the portfolio, which invests in a mix of equity and fixed-income securities. (See the Schedule of Investments for each LIVESTRONG Portfolio’s asset allocations as of July 31, 2009.)
Data presented reflect past performance. Past performance is no guarantee of future results. Current performance may be higher or lower than the performance shown. Investment return and principal value will fluctuate, and redemption value may be more or less than original cost. To obtain performance data current to the most recent month end, please call 1-800-345-2021 or visit americancentury.com. The performance of LIVESTRONG Portfolios is dependent on the performance of their underlying American Century Investments funds, and will assume the risks associated with these funds. The risks will vary according to each LIVESTRONG Portfolio’s asset allocation, and a fund with a later target date is expected to be more volatile than one with an earlier target date. International investing involves special risks, such as political instability and currency fluctuations. Investing in emerging markets may accentuate these risks. As interest rates rise, bond values will decline.
Unless otherwise indicated, performance reflects Investor Class shares; performance for other share classes will vary due to differences in fee structure. For information about other share classes available, please consult the prospectus. Data assumes reinvestment of dividends and capital gains, and none of the charts reflect the deduction of taxes that a shareholder would pay on fund distributions or the redemption of fund shares. Returns for the indices are provided for comparison. The fund’s total returns include operating expenses (such as administrative fees) that reduce returns, while the total returns of the indices do not.
4
LIVESTRONG Portfolios | |||
Total Returns as of July 31, 2009 | |||
Average Annual | |||
Returns | |||
Since | Inception | ||
1 year | Inception | Date | |
LIVESTRONG 2040 Portfolio | |||
Investor Class | -15.53% | -18.71% | 5/30/08 |
Russell 3000 Index(1) | -20.21% | -23.94% | — |
Citigroup US Broad Investment-Grade Bond Index | 8.63% | 7.38% | — |
Institutional Class | -15.43% | -18.63% | 5/30/08 |
Advisor Class | -15.87% | -18.99% | 5/30/08 |
R Class | -16.01% | -19.18% | 5/30/08 |
LIVESTRONG 2045 Portfolio | |||
Investor Class | -17.74% | 2.81% | 8/31/04 |
Russell 3000 Index(1) | -20.21% | 0.34% | — |
Citigroup US Broad Investment-Grade Bond Index | 8.63% | 5.13% | — |
Institutional Class | -17.56% | 3.01% | 8/31/04 |
Advisor Class | -17.98% | 2.55% | 8/31/04 |
R Class | -18.20% | 2.30% | 8/31/04 |
(1) Data provided by Lipper Inc. — A Reuters Company. © 2009 Reuters. All rights reserved. Any copying, republication or redistribution of Lipper | |||
content, including by caching, framing or similar means, is expressly prohibited without the prior written consent of Lipper. Lipper shall not be | |||
liable for any errors or delays in the content, or for any actions taken in reliance thereon. | |||
The data contained herein has been obtained from company reports, financial reporting services, periodicals and other resources believed to be | |||
reliable. Although carefully verified, data on compilations is not guaranteed by Lipper and may be incomplete. No offer or solicitations to buy or | |||
sell any of the securities herein is being made by Lipper. |
The Russell 3000 Index represents approximately 98% of the investable U.S. equity market and provides a broad measure of equity performance. The Citigroup US Broad Investment-Grade Bond Index represents the U.S. investment-grade fixed-rate bond market and provides a broad measure of bond market performance. Performance for these indices is provided for reference only. Neither index is intended to represent the composition of the portfolio, which invests in a mix of equity and fixed-income securities. (See the Schedule of Investments for each LIVESTRONG Portfolio’s asset allocations as of July 31, 2009.)
Data presented reflect past performance. Past performance is no guarantee of future results. Current performance may be higher or lower than the performance shown. Investment return and principal value will fluctuate, and redemption value may be more or less than original cost. To obtain performance data current to the most recent month end, please call 1-800-345-2021 or visit americancentury.com. The performance of LIVESTRONG Portfolios is dependent on the performance of their underlying American Century Investments funds, and will assume the risks associated with these funds. The risks will vary according to each LIVESTRONG Portfolio’s asset allocation, and a fund with a later target date is expected to be more volatile than one with an earlier target date. International investing involves special risks, such as political instability and currency fluctuations. Investing in emerging markets may accentuate these risks. As interest rates rise, bond values will decline.
Unless otherwise indicated, performance reflects Investor Class shares; performance for other share classes will vary due to differences in fee structure. For information about other share classes available, please consult the prospectus. Data assumes reinvestment of dividends and capital gains, and none of the charts reflect the deduction of taxes that a shareholder would pay on fund distributions or the redemption of fund shares. Returns for the indices are provided for comparison. The fund’s total returns include operating expenses (such as administrative fees) that reduce returns, while the total returns of the indices do not.
5
LIVESTRONG Portfolios | |||
Total Returns as of July 31, 2009 | |||
Average Annual | |||
Returns | |||
Since | Inception | ||
1 year | Inception | Date | |
LIVESTRONG 2050 Portfolio | |||
Investor Class | -18.30% | -21.43% | 5/30/08 |
Russell 3000 Index(1) | -20.21% | -23.94% | — |
Citigroup US Broad Investment-Grade Bond Index | 8.63% | 7.38% | — |
Institutional Class | -18.09% | -21.27% | 5/30/08 |
Advisor Class | -18.52% | -21.62% | 5/30/08 |
R Class | -18.66% | -21.81% | 5/30/08 |
(1) Data provided by Lipper Inc. — A Reuters Company. © 2009 Reuters. All rights reserved. Any copying, republication or redistribution of Lipper | |||
content, including by caching, framing or similar means, is expressly prohibited without the prior written consent of Lipper. Lipper shall not be | |||
liable for any errors or delays in the content, or for any actions taken in reliance thereon. | |||
The data contained herein has been obtained from company reports, financial reporting services, periodicals and other resources believed to be | |||
reliable. Although carefully verified, data on compilations is not guaranteed by Lipper and may be incomplete. No offer or solicitations to buy or | |||
sell any of the securities herein is being made by Lipper. |
The Russell 3000 Index represents approximately 98% of the investable U.S. equity market and provides a broad measure of equity performance. The Citigroup US Broad Investment-Grade Bond Index represents the U.S. investment-grade fixed-rate bond market and provides a broad measure of bond market performance. Performance for these indices is provided for reference only. Neither index is intended to represent the composition of the portfolio, which invests in a mix of equity and fixed-income securities. (See the Schedule of Investments for each LIVESTRONG Portfolio’s asset allocations as of July 31, 2009.)
Data presented reflect past performance. Past performance is no guarantee of future results. Current performance may be higher or lower than the performance shown. Investment return and principal value will fluctuate, and redemption value may be more or less than original cost. To obtain performance data current to the most recent month end, please call 1-800-345-2021 or visit americancentury.com. The performance of LIVESTRONG Portfolios is dependent on the performance of their underlying American Century Investments funds, and will assume the risks associated with these funds. The risks will vary according to each LIVESTRONG Portfolio’s asset allocation, and a fund with a later target date is expected to be more volatile than one with an earlier target date. International investing involves special risks, such as political instability and currency fluctuations. Investing in emerging markets may accentuate these risks. As interest rates rise, bond values will decline.
Unless otherwise indicated, performance reflects Investor Class shares; performance for other share classes will vary due to differences in fee structure. For information about other share classes available, please consult the prospectus. Data assumes reinvestment of dividends and capital gains, and none of the charts reflect the deduction of taxes that a shareholder would pay on fund distributions or the redemption of fund shares. Returns for the indices are provided for comparison. The fund’s total returns include operating expenses (such as administrative fees) that reduce returns, while the total returns of the indices do not.
6
LIVESTRONG Portfolios
![](https://capedge.com/proxy/N-CSR/0001467105-09-000019/cl-ann66295x11x1.jpg)
Data presented reflect past performance. Past performance is no guarantee of future results. Current performance may be higher or lower than the performance shown. Investment return and principal value will fluctuate, and redemption value may be more or less than original cost. To obtain performance data current to the most recent month end, please call 1-800-345-2021 or visit americancentury.com. The performance of LIVESTRONG Portfolios is dependent on the performance of their underlying American Century Investments funds, and will assume the risks associated with these funds. The risks will vary according to each LIVESTRONG Portfolio’s asset allocation, and a fund with a later target date is expected to be more volatile than one with an earlier target date. International investing involves special risks, such as political instability and currency fluctuations. Investing in emerging markets may accentuate these risks. As interest rates rise, bond values w ill decline.
Unless otherwise indicated, performance reflects Investor Class shares; performance for other share classes will vary due to differences in fee structure. For information about other share classes available, please consult the prospectus. Data assumes reinvestment of dividends and capital gains, and none of the charts reflect the deduction of taxes that a shareholder would pay on fund distributions or the redemption of fund shares. Returns for the indices are provided for comparison. The fund’s total returns include operating expenses (such as administrative fees) that reduce returns, while the total returns of the indices do not.
7
LIVESTRONG Portfolios
![](https://capedge.com/proxy/N-CSR/0001467105-09-000019/cl-ann66295x12x1.jpg)
Data presented reflect past performance. Past performance is no guarantee of future results. Current performance may be higher or lower than the performance shown. Investment return and principal value will fluctuate, and redemption value may be more or less than original cost. To obtain performance data current to the most recent month end, please call 1-8 00-345-2021 or visit americancentury.com. The performance of LIVESTRONG Portfolios is dependent on the performance of their underlying American Century Investments funds, and will assume the risks associated with these funds. The risks will vary according to each LIVESTRONG Portfolio’s asset allocation, and a fund with a later target date is expected to be more volatile than one with an earlier target date. International investing involves special risks, such as political instability and currency fluctuations. Investing in emerging markets may accentuate these risks. As interest rates rise, bond val ues will decline.
Unless otherwise indicated, performance reflects Investor Class shares; performance for other share classes will vary due to differences in fee structure. For information about other share classes available, please consult the prospectus. Data assumes reinvestment of dividends and capital gains, and none of the charts reflect the deduction of taxes that a shareholder would pay on fund distributions or the redemption of fund shares. Returns for the indices are provided for comparison. The fund’s total returns include operating expenses (such as administrative fees) that reduce returns, while the total returns of the indices do not.
8
LIVESTRONG Portfolios
![](https://capedge.com/proxy/N-CSR/0001467105-09-000019/cl-ann66295x13x1.jpg)
Data presented reflect past performance. Past performance is no guarantee of future results. Current performance may be higher or lower than the performance shown. Investment return and principal value will fluctuate, and redemption value may be more or less than original cost. To obtain performance data current to the most recent month end, please call 1-800-345-2021 or visit americancentury.com. The performance of LIVESTRONG Portfolios is dependent on the performance of their underlying American Century Investments funds, and will assume the risks associated with these funds. The risks will vary according to each LIVESTRONG Portfolio’s asset allocation, and a fund with a later target date is expected to be more volatile than one with an earlier target date. International investing involves special risks, such as political instability and currency fluctuations. Investing in emerging markets may accentuate these risks. As interest rates rise, bond values will decline.
Unless otherwise indicated, performance reflects Investor Class shares; performance for other share classes will vary due to differences in fee structure. For information about other share classes available, please consult the prospectus. Data assumes reinvestment of dividends and capital gains, and none of the charts reflect the deduction of taxes that a shareholder would pay on fund distributions or the redemption of fund shares. Returns for the indices are provided for comparison. The fund’s total returns include operating expenses (such as administrative fees) that reduce returns, while the total returns of the indices do not.
9
LIVESTRONG Portfolios
![](https://capedge.com/proxy/N-CSR/0001467105-09-000019/cl-ann66295x14x1.jpg)
Data presented reflect past performance. Past performance is no guarantee of future results. Current performance may be higher or lower than the performance shown. Investment return and principal value will fluctuate, and redemption value may be more or less than original co st. To obtain performance data current to the most recent month end, please call 1-800-345-2021 or visit americancentury.com. The performance of LIVESTRONG Portfolios is dependent on the performance of their underlying American Century Investments funds, and will assume the risks associated with these funds. The risks will vary according to each LIVESTRONG Portfolio’s asset allocation, and a fund with a later target date is expected to be more volatile than one with an earlier target date. International investing involves special risks, such as political instability and currency fluctuations. Invest ing in emerging markets may accentuate these risks. As interest rates rise, bond values will decline.
Unless otherwise indicated, performance reflects Investor Class shares; performance for other share classes will vary due to differences in fee structure. For information about other share classes available, please consult the prospectus. Data assumes reinvestment of dividends and capital gains, and none of the charts reflect the deduction of taxes that a shareholder would pay on fund distributions or the redemption of fund shares. Returns for the indices are provided for comparison. The fund’s total returns include operating expenses (such as administrative fees) that reduce returns, while the total returns of the indices do not.
10
LIVESTRONG Portfolios
![](https://capedge.com/proxy/N-CSR/0001467105-09-000019/cl-ann66295x15x1.jpg)
Data presented reflect past performance. Past performance is no guarantee of future results. Current performance may be higher or lower than the performance shown. Investment return and principal value will fluctuate, and redemption value may be more or less than original cost. To obtain performance data current to the most recent month end, please call 1-800-345-2021 or visit americancentury.com. The performance of LIVESTRONG Portfolios is dependent on the performance of their underlying American Century Investments funds, and will assume the risks associated with these funds. The risks will vary according to each LIVESTRONG Portfolio’s asset allocation, and a fund with a later target date is expected to be more volatile than one with an earlier target date. International investing involves special risks, such as political instability and currency fluctuations. Investing in emerging markets may accentuate these risks. As interest rates rise, bond values will decline.
Unless otherwise indicated, performance reflects Investor Class shares; performance for other share classes will vary due to differences in fee structure. For information about other share classes available, please consult the prospectus. Data assumes reinvestment of dividends and capital gains, and none of the charts reflect the deduction of taxes that a shareholder would pay on fund distributions or the redemption of fund shares. Returns for the indices are provided for comparison. The fund’s total returns include operating expenses (such as administrative fees) that reduce returns, while the total returns of the indices do not.
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LIVESTRONG Portfolios | ||||||
One-Year Returns Over Life of Class | ||||||
Periods ended July 31 | 2005 | 2006 | 2007 | 2008 | 2009 | |
LIVESTRONG Income Portfolio — Investor Class | 8.14%(1) | 2.99% | 10.51% | 0.11% | -6.44% | |
LIVESTRONG 2015 Portfolio — Investor Class | 11.17%(1) | 4.46% | 12.46% | -0.67% | -8.63% | |
LIVESTRONG 2020 Portfolio — Investor Class | — | — | — | -5.10%(2) | -9.38% | |
LIVESTRONG 2025 Portfolio — Investor Class | 13.57%(1) | 5.48% | 14.45% | -2.39% | -11.64% | |
LIVESTRONG 2030 Portfolio — Investor Class | — | — | — | -6.10%(2) | -13.30% | |
LIVESTRONG 2035 Portfolio — Investor Class | 15.71%(1) | 6.45% | 16.86% | -4.33% | -15.54% | |
LIVESTRONG 2040 Portfolio — Investor Class | — | — | — | -7.10%(2) | -15.53% | |
LIVESTRONG 2045 Portfolio — Investor Class | 16.86%(1) | 6.76% | 18.23% | -5.53% | -17.74% | |
LIVESTRONG 2050 Portfolio — Investor Class | — | — | — | -7.70%(2) | -18.30% | |
Russell 3000 Index | 16.43%(1) | 5.14% | 16.08% | -10.32%(3) | -20.21% | |
Citigroup US Broad Investment-Grade Bond Index | 2.99%(1) | 1.47% | 5.55% | 6.72%(3) | 8.63% | |
(1) | From 8/31/04, the Investor Class’s inception date. Not annualized. | |||||
(2) | From 5/30/08, the Investor Class’s inception date. Not annualized. | |||||
(3) | Returns shown above represent the one-year period ended 7/31/08. Returns from 5/30/08 to 7/31/08 are –8.98% and 0.03% for Russell | |||||
3000 Index and Citigroup US Broad Investment-Grade Bond Index, respectively. |
Total Annual Fund Operating Expenses | ||||
Investor Class | Institutional Class | Advisor Class | R Class | |
LIVESTRONG Income Portfolio | 0.76% | 0.56% | 1.01% | 1.26% |
LIVESTRONG 2015 Portfolio | 0.80% | 0.60% | 1.05% | 1.30% |
LIVESTRONG 2020 Portfolio | 0.82% | 0.62% | 1.07% | 1.32% |
LIVESTRONG 2025 Portfolio | 0.85% | 0.65% | 1.10% | 1.35% |
LIVESTRONG 2030 Portfolio | 0.87% | 0.67% | 1.12% | 1.37% |
LIVESTRONG 2035 Portfolio | 0.90% | 0.70% | 1.15% | 1.40% |
LIVESTRONG 2040 Portfolio | 0.92% | 0.72% | 1.17% | 1.42% |
LIVESTRONG 2045 Portfolio | 0.94% | 0.74% | 1.19% | 1.44% |
LIVESTRONG 2050 Portfolio | 0.94% | 0.74% | 1.19% | 1.44% |
The total annual fund operating expenses shown is as stated in the fund’s prospectus current as of the date of this report. The prospectus may vary from the expense ratio shown elsewhere in this report because it is based on a different time period, includes acquired fund fees and expenses, and, if applicable, does not include fee waivers or expense reimbursements.
Data presented reflect past performance. Past performance is no guarantee of future results. Current performance may be higher or lower than the performance shown. Investment return and principal value will fluctuate, and redemption value may be more or less than original cost. To obtain performance data current to the most recent month end, please call 1-800-345-2021 or visit americancentury.com. The performance of LIVESTRONG Portfolios is dependent on the performance of their underlying American Century Investments funds, and will assume the risks associated with these funds. The risks will vary according to each LIVESTRONG Portfolio’s asset allocation, and a fund with a later target date is expected to be more volatile than one with an earlier target date. International investing involves special risks, such as political instability and currency fluctuations. Investing in emerging markets may accentuate these risks. As interest rates rise, bond values will decline.
Unless otherwise indicated, performance reflects Investor Class shares; performance for other share classes will vary due to differences in fee structure. For information about other share classes available, please consult the prospectus. Data assumes reinvestment of dividends and capital gains, and none of the charts reflect the deduction of taxes that a shareholder would pay on fund distributions or the redemption of fund shares. Returns for the indices are provided for comparison. The fund’s total returns include operating expenses (such as administrative fees) that reduce returns, while the total returns of the indices do not.
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Portfolio Commentary |
LIVESTRONG Portfolios |
Portfolio Managers: Enrique Chang, Scott Wittman, and Irina Torelli
Portfolio manager Jeff Tyler, who has managed LIVESTRONG Portfolios since their inception in 2004, left the management team on June 30, 2009, and retired after a distinguished 28-year investment career. To replace Mr. Tyler, Scott Wittman joined the portfolio management team in June 2009. Mr. Wittman came to American Century Investments from Munder Capital Management, and he brings 25 years of industry experience and expertise across a diverse array of asset classes. In addition, chief investment officer Enrique Chang joined the management team in January 2009.
Performance Summary
Each of the nine LIVESTRONG Portfolios declined for the fiscal year ended July 31, 2009, with returns ranging from –6.44%* for LIVESTRONG Income Portfolio to –18.30%* for LIVESTRONG 2050 Portfolio (see pages 2–12 for more detailed performance information). The negative returns resulted primarily from a sharp decline in the global equity markets; in contrast, bonds delivered solidly positive returns for the 12-month period.
Because of LIVESTRONG Portfolios’ strategic exposure to a variety of asset classes, a review of the financial markets helps explain much of their performance.
Stock Market Review
U.S. stocks fell substantially during the 12-month period in an environment of extreme volatility and dramatic shifts in market sentiment. The major stock indices remained on a downward trajectory for much of the period as a deepening economic downturn, a worsening credit crunch, and a near collapse in the financial sector weighed on investor confidence.
The U.S. economy, already in recession since the end of 2007, contracted in the last two quarters of 2008 and the first two quarters of 2009. The slumping economy was characterized by substantial job losses (leading to the highest unemployment rate since 1983), a drop-off in consumer spending, and further deterioration in the housing market. At the same time, a lack of liquidity in the credit markets put enormous pressure on the balance sheets and profitability of financial companies worldwide. After a series of bankruptcies and takeovers swept through the financial sector in late 2008, the federal government moved swiftly to provide financial assistance and other support to prevent a full-scale breakdown in the financial system.
Market Index Total Returns | ||||
For the 12 months ended July 31, 2009 | ||||
U.S. Stocks | U.S. Fixed Income | |||
Russell 1000 Index (Large-Cap) | –20.17% | Citigroup US Broad | ||
Russell Midcap Index | –22.22% | Investment-Grade Bond Index | 8.63% | |
Russell 2000 Index (Small-Cap) | –20.72% | Citigroup US Treasury 10-Year | ||
International Stocks | Benchmark (On-the-Run) Index | 7.49% | ||
MSCI EAFE (Europe, Australasia, Far East) Index | –22.60% | Citigroup US Treasury Bill | ||
MSCI EM (Emerging Markets) Index | –16.84% | Three-Month Index | 0.65% | |
International Bonds | ||||
Citigroup Non-US World | ||||
Government Bond Index | 5.61% | |||
*All fund returns referenced in this commentary are for Investor Class shares. |
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LIVESTRONG Portfolios
The economic and financial difficulties led to a steep market decline throughout the last half of 2008 and into early 2009. From the beginning of the reporting period through March 9, 2009, the broad stock indices plummeted by more than 45%.
Market conditions changed dramatically in the last few months of the period. The stock market hit a multi-year low on March 9 and then staged a powerful rally as signs of economic stabilization generated optimism about a possible recovery. Investors also grew more confident about the federal government’s actions to stimulate economic activity and restore liquidity in the credit markets.
Despite a rebound of nearly 50% from March 9 through the end of July, the broad equity indices declined by more than 20% overall for the 12-month period (see the table on page 13). Performance was similar across all market capitalizations, but growth and value stocks were mixed—value outperformed among large-cap shares, growth won out among mid-cap issues, and growth and value returns were virtually identical in the small-cap segment of the market.
The 12-month period marked the first time since World War II that the U.S., Europe, and Japan were all in recession simultaneously. As a result, equity markets outside the U.S. followed the same path as the domestic stock market, though they experienced even greater volatility. Emerging markets were especially turbulent, plummeting in the first half of the period before surging back by more than 60% in the last six months. Among developed markets, Japan and its neighbors along the Pacific Rim posted the best returns, while European bourses lagged.
Bond Market Review
The U.S. bond market advanced steadily for the 12-month period, although market leadership changed abruptly. The deepening economic downturn, financial sector turmoil, and slumping stock market in the last half of 2008 and early 2009 led investors to seek out the safety of high-quality bonds, boosting Treasury securities at the expense of corporate bonds. However, as early signs of stabilization in the economy emerged, corporate securities led the bond market higher, while Treasury bonds tumbled as the government increased issuance to finance its fiscal stimulus efforts.
Overall, however, mortgage-backed securities generated the best returns for the 12-month period. Their outperformance was driven in part by the Federal Reserve’s purchases of mortgage-backed securities, particularly those issued by government agencies, to help keep mortgage rates low and boost the housing market. Corporate bonds were also strong performers, rebounding sharply after sizable declines in 2008, while Treasury securities lagged.
Foreign bonds also gained ground during the reporting period, largely because of a decline in the U.S. dollar versus many of the world’s major currencies in the last half of the period. The weaker dollar reflected relatively low U.S. interest rates and an increase in the government’s debt load, as well as a trend toward currency depreciation in countries where central banks were acting aggressively to arrest the economic downturn. The dollar’s decline enhanced foreign bond returns for U.S. investors.
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LIVESTRONG Portfolios | ||||||
Underlying Fund Allocations(1) as a % of net assets as of July 31, 2009 | ||||||
LIVESTRONG | LIVESTRONG | LIVESTRONG | LIVESTRONG | LIVESTRONG | ||
Income | 2015 | 2020 | 2025 | 2030 | ||
Portfolio | Portfolio | Portfolio | Portfolio | Portfolio | ||
Equity | ||||||
NT Equity | ||||||
Growth Fund | 13.4% | 12.9% | 12.5% | 12.7% | 12.9% | |
NT Growth Fund | 6.7% | 8.2% | 9.4% | 11.2% | 13.0% | |
NT Large Company | ||||||
Value Fund | 11.2% | 11.3% | 11.5% | 12.0% | 12.7% | |
NT Mid Cap | ||||||
Value Fund | 4.1% | 5.1% | 5.6% | 5.4% | 5.6% | |
NT Small | ||||||
Company Fund | 2.1% | 2.1% | 2.6% | 3.6% | 4.3% | |
NT Vista Fund | 2.5% | 3.7% | 4.5% | 4.9% | 5.4% | |
Real Estate Fund | 1.0% | 1.2% | 1.5% | 1.7% | 1.9% | |
NT Emerging | ||||||
Markets Fund | — | 1.4% | 2.5% | 3.1% | 3.9% | |
NT International | ||||||
Growth Fund | 5.5% | 6.6% | 7.6% | 9.2% | 10.3% | |
Total Equity | 46.5% | 52.5% | 57.7% | 63.8% | 70.0% | |
Fixed Income | ||||||
High-Yield Fund | 3.8% | 3.6% | 3.4% | 3.0% | 2.6% | |
Inflation-Adjusted | ||||||
Bond Fund | 7.4% | 7.0% | 6.6% | 6.0% | 5.2% | |
NT Diversified | ||||||
Bond Fund | 25.7% | 24.4% | 23.0% | 20.5% | 18.0% | |
International | ||||||
Bond Fund | 7.1% | 5.9% | 4.6% | 2.0% | — | |
Total Fixed Income | 44.0% | 40.9% | 37.6% | 31.5% | 25.8% | |
Premium Money | ||||||
Market Fund | 9.5% | 6.6% | 4.7% | 4.7% | 4.2% | |
Other Assets | ||||||
and Liabilities | —(2) | —(2) | —(2) | —(2) | —(2) | |
(1) | Institutional Class, except Premium Money Market Fund Investor Class. | |||||
(2) | Category is less than 0.05% of total net assets. |
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LIVESTRONG Portfolios | |||||
Underlying Fund Allocations(1) as a % of net assets as of July 31, 2009 | |||||
LIVESTRONG | LIVESTRONG | LIVESTRONG | LIVESTRONG | ||
2035 | 2040 | 2045 | 2050 | ||
Portfolio | Portfolio | Portfolio | Portfolio | ||
Equity | |||||
NT Equity Growth Fund | 13.9% | 14.9% | 14.8% | 15.3% | |
NT Growth Fund | 13.9% | 14.6% | 14.8% | 15.3% | |
NT Large Company Value Fund | 13.6% | 14.3% | 14.7% | 15.3% | |
NT Mid Cap Value Fund | 6.6% | 7.3% | 7.3% | 7.5% | |
NT Small Company Fund | 4.2% | 4.1% | 4.8% | 5.1% | |
NT Vista Fund | 6.4% | 7.1% | 7.1% | 7.3% | |
Real Estate Fund | 2.1% | 2.4% | 2.6% | 2.8% | |
NT Emerging Markets Fund | 4.7% | 5.7% | 6.9% | 7.1% | |
NT International Growth Fund | 10.8% | 11.0% | 10.7% | 10.1% | |
Total Equity | 76.2% | 81.4% | 83.7% | 85.8% | |
Fixed Income | |||||
High-Yield Fund | 2.3% | 1.9% | 1.7% | 1.5% | |
Inflation-Adjusted Bond Fund | 4.4% | 3.7% | 3.2% | 2.8% | |
NT Diversified Bond Fund | 15.3% | 13.0% | 11.4% | 9.9% | |
Total Fixed Income | 22.0% | 18.6% | 16.3% | 14.2% | |
Premium Money Market Fund | 1.8% | — | — | — | |
Other Assets and Liabilities | —(2) | —(2) | —(2) | —(2) | |
(1) | Institutional Class, except Premium Money Market Fund Investor Class. | ||||
(2) | Category is less than 0.05% of total net assets. |
Fund Information
Each LIVESTRONG Portfolio is a “fund of funds” that invests in other American Century Investments mutual funds to achieve its investment objective and target asset allocation. (See pages 15–16 for the specific underlying fund allocations for each LIVESTRONG Portfolio.) A LIVESTRONG Portfolio’s target date is the approximate year when investors plan to start withdrawing their money. The principal value of the investment is not guaranteed at any time, including at the target date.
Each target-date LIVESTRONG Portfolio seeks the highest total return consistent with its asset mix. Each year, the asset mix and weightings are adjusted to be more conservative. In general, as the target year approaches, the portfolio’s allocation becomes more conservative by decreasing the allocation to stocks and increasing the allocation to bonds and money market instruments. By the time each fund reaches its target year, its target asset mix will become fixed and will match that of LIVESTRONG Income Portfolio.
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LIVESTRONG Portfolios
Portfolio Performance
Within LIVESTRONG Portfolios, every stock fund posted a negative return for the 12-month period. The worst performers included Real Estate, which tumbled by 45% as the commercial real estate market slumped, and mid-cap growth component NT Vista, which fell by more than 30% as stock selection weighed on results. Small-cap holding NT Small Company and the two international components, NT International Growth and NT Emerging Markets, also fell by more than 25% for the reporting period. Stock selection also detracted from performance in each of these three funds.
The best performer within LIVESTRONG Portfolios’ equity holdings was NT Mid Cap Value, which was the only LIVESTRONG Portfolio holding to decline by less than 10% for the 12-month period. LIVESTRONG Portfolios’ two large-cap funds, NT Growth and NT Large Company Value, also held up well and outpaced their respective benchmarks.
NT Diversified Bond, the primary fixed-income holding in LIVESTRONG Portfolios, was the best-performing fund, producing a return that was in line with the broad bond market indices, though it outperformed over the last six months of the period. An underweight position in Treasury bonds and increased exposure to corporate bonds and high-quality municipal bonds contributed favorably to NT Diversified Bond’s performance.
Two other fixed-income components—High-Yield and International Bond (only in LIVESTRONG Income Portfolio, LIVESTRONG 2015 Portfolio, LIVESTRONG 2020 Portfolio, and LIVESTRONG 2025 Portfolio) —advanced modestly for the 12-month period, though both funds lagged their respective benchmark indices. Inflatio n-Adjusted Bond was the only fixed-income fund to decline during the period, reflecting the lack of inflationary pressure during the economic downturn.
Outlook
The severe decline in stocks in the last half of 2008 and early 2009 was driven by fear and panic about a potential collapse in the financial system and a global economic downturn that could rival the Great Depression. The stock market rally of the last several months represented an easing of these concerns, but we are still a long way from a full financial and economic recovery. While the rate of decline in many segments of the economy—such as employment and housing—has been slowing, they are still declining. Furthermore, the savings rate in the U.S. recently hit a 15-year high at a time when the economy needs a shot in the arm from increased consumer spending. As a result, the global financial markets are likely to remain volatile amid continued economic uncertainty.
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Shareholder Fee Examples (Unaudited) |
Fund shareholders may incur two types of costs: (1) transaction costs, including sales charges (loads) on purchase payments and redemption/ exchange fees; and (2) ongoing costs, including management fees; distribution and service (12b-1) fees; and other fund expenses. This example is intended to help you understand your ongoing costs (in dollars) of investing in your fund and to compare these costs with the ongoing cost of investing in other mutual funds. As a shareholder in the underlying American Century Investments funds, your fund will indirectly bear its pro rata share of the expenses incurred by the underlying funds. These expenses are not included in the fund’s annualized expense ratio or the expenses paid during the period. These expenses are, however, included in the effective expenses paid during the period.
The example is based on an investment of $1,000 made at the beginning of the period and held for the entire period from February 1, 2009 to July 31, 2009.
Actual Expenses
The table provides information about actual account values and actual expenses for each class. You may use the information, together with the amount you invested, to estimate the expenses that you paid over the period. First, identify the share class you own. Then 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 under the heading “Expenses Paid During Period” to estimate the expenses you paid on your account during this period.
If you hold Investor Class shares of any American Century Investments fund, or Institutional Class shares of the American Century Diversified Bond Fund, in an American Century Investments account (i.e., not a financial intermediary or retirement plan account), American Century Investments may charge you a $12.50 semiannual account maintenance fee if the value of those shares is less than $10,000. We will redeem shares automatically in one of your accounts to pay the $12.50 fee. In determining your total eligible investment amount, we will include your investments in all personal accounts (including American Century Investments Brokerage accounts) registered under your Social Security number. Personal accounts include individual accounts, joint accounts, UGMA/UTMA accounts, personal trusts, Coverdell Education Savings Accounts and IRAs (including traditional, Roth, Rollover, SEP-, SARSEP- and SIMPLE-IRAs), and certain other retirement accounts. If you have only business, business retirement, employer-sponsored or American Century Investments Brokerage accounts, you are currently not subject to this fee. We will not charge the fee as long as you choose to manage your accounts exclusively online. If you are subject to the Account Maintenance Fee, your account value could be reduced by the fee amount.
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Hypothetical Example for Comparison Purposes
The table also provides information about hypothetical account values and hypothetical expenses based on the actual expense ratio of each class of your fund and an assumed rate of return of 5% per year before expenses, which is not the actual return of a fund’s share class. 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 your fund 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 table are meant to highlight your ongoing costs only and do not reflect any transactional costs, such as sales charges (loads) or redemption/exchange fees. Therefore, the table is useful in comparing ongoing costs only, and will not help you determine the relative total costs of owning different funds. In addition, if these transactional costs were included, your costs would have been higher.
Effective | ||||||
Expenses | Expenses | |||||
Beginning | Ending | Paid During | Paid During | Effective | ||
Account | Account | Period(1) | Annualized | Period(2) | Annualized | |
Value | Value | 2/1/09 – | Expense | 2/1/09 – | Expense | |
2/1/09 | 7/31/09 | 7/31/09 | Ratio(1) | 7/31/09 | Ratio(2) | |
LIVESTRONG Income Portfolio | ||||||
Actual | ||||||
Investor Class | $1,000 | $1,126.60 | $1.05 | 0.20% | $4.06 | 0.77% |
Institutional Class | $1,000 | $1,127.60 | $0.00 | �� 0.00%(3) | $3.01 | 0.57% |
Advisor Class | $1,000 | $1,125.20 | $2.37 | 0.45% | $5.37 | 1.02% |
R Class | $1,000 | $1,124.00 | $3.69 | 0.70% | $6.69 | 1.27% |
Hypothetical | ||||||
Investor Class | $1,000 | $1,023.80 | $1.00 | 0.20% | $3.86 | 0.77% |
Institutional Class | $1,000 | $1,024.79 | $0.00 | 0.00%(3) | $2.86 | 0.57% |
Advisor Class | $1,000 | $1,022.56 | $2.26 | 0.45% | $5.11 | 1.02% |
R Class | $1,000 | $1,021.32 | $3.51 | 0.70% | $6.36 | 1.27% |
(1) | Expenses are equal to the class’s annualized expense ratio listed in the table above, multiplied by the average account value over the period, multiplied by 181, the number of days in the most recent fiscal half-year, divided by 365, to reflect the one-half year period. The fees and expenses of the underlying American Century Investments funds in which the fund invests are not included in the class’s annualized expense ratio. |
(2) | Effective expenses reflect the sum of expenses borne directly by the class plus the fund’s pro rata share of the weighted average expense ratio of the underlying funds in which it invests. The effective annualized expense ratio combines the class’s annualized expense ratio and the annualized weighted average expense ratio of the underlying funds. The annualized weighted average expense ratio of the underlying funds for the one-half year period reflects the actual expense ratio of each underlying fund from its most recent shareholder report, annualized and weighted for the fund’s relative average investment therein during the period. |
(3) | Other expenses, which include the fees and expenses of the fund’s independent directors and its legal counsel, as well as interest, did not exceed 0.005%. |
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Effective | ||||||
Expenses | Expenses | |||||
Beginning | Ending | Paid During | Paid During | Effective | ||
Account | Account | Period(1) | Annualized | Period(2) | Annualized | |
Value | Value | 2/1/09 – | Expense | 2/1/09 – | Expense | |
2/1/09 | 7/31/09 | 7/31/09 | Ratio(1) | 7/31/09 | Ratio(2) | |
LIVESTRONG 2015 Portfolio | ||||||
Actual | ||||||
Investor Class | $1,000 | $1,141.00 | $1.06 | 0.20% | $4.30 | 0.81% |
Institutional Class | $1,000 | $1,142.00 | $0.00 | 0.00%(3) | $3.24 | 0.61% |
Advisor Class | $1,000 | $1,139.90 | $2.39 | 0.45% | $5.62 | 1.06% |
R Class | $1,000 | $1,137.60 | $3.71 | 0.70% | $6.94 | 1.31% |
Hypothetical | ||||||
Investor Class | $1,000 | $1,023.80 | $1.00 | 0.20% | $4.06 | 0.81% |
Institutional Class | $1,000 | $1,024.79 | $0.00 | 0.00%(3) | $3.06 | 0.61% |
Advisor Class | $1,000 | $1,022.56 | $2.26 | 0.45% | $5.31 | 1.06% |
R Class | $1,000 | $1,021.32 | $3.51 | 0.70% | $6.56 | 1.31% |
LIVESTRONG 2020 Portfolio | ||||||
Actual | ||||||
Investor Class | $1,000 | $1,154.00 | $1.07 | 0.20% | $4.43 | 0.83% |
Institutional Class | $1,000 | $1,155.30 | $0.00 | 0.00%(3) | $3.37 | 0.63% |
Advisor Class | $1,000 | $1,151.20 | $2.40 | 0.45% | $5.76 | 1.08% |
R Class | $1,000 | $1,149.90 | $3.73 | 0.70% | $7.09 | 1.33% |
Hypothetical | ||||||
Investor Class | $1,000 | $1,023.80 | $1.00 | 0.20% | $4.16 | 0.83% |
Institutional Class | $1,000 | $1,024.79 | $0.00 | 0.00%(3) | $3.16 | 0.63% |
Advisor Class | $1,000 | $1,022.56 | $2.26 | 0.45% | $5.41 | 1.08% |
R Class | $1,000 | $1,021.32 | $3.51 | 0.70% | $6.66 | 1.33% |
(1) | Expenses are equal to the class’s annualized expense ratio listed in the table above, multiplied by the average account value over the period, multiplied by 181, the number of days in the most recent fiscal half-year, divided by 365, to reflect the one-half year period. The fees and expenses of the underlying American Century Investments funds in which the fund invests are not included in the class’s annualized expense ratio. |
(2) | Effective expenses reflect the sum of expenses borne directly by the class plus the fund’s pro rata share of the weighted average expense ratio of the underlying funds in which it invests. The effective annualized expense ratio combines the class’s annualized expense ratio and the annualized weighted average expense ratio of the underlying funds. The annualized weighted average expense ratio of the underlying funds for the one-half year period reflects the actual expense ratio of each underlying fund from its most recent shareholder report, annualized and weighted for the fund’s relative average investment therein during the period. |
(3) | Other expenses, which include the fees and expenses of the fund’s independent directors and its legal counsel, as well as interest, did not exceed 0.005%. |
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Effective | ||||||
Expenses | Expenses | |||||
Beginning | Ending | Paid During | Paid During | Effective | ||
Account | Account | Period(1) | Annualized | Period(2) | Annualized | |
Value | Value | 2/1/09 – | Expense | 2/1/09 – | Expense | |
2/1/09 | 7/31/09 | 7/31/09 | Ratio(1) | 7/31/09 | Ratio(2) | |
LIVESTRONG 2025 Portfolio | ||||||
Actual | ||||||
Investor Class | $1,000 | $1,163.30 | $1.07 | 0.20% | $4.61 | 0.86% |
Institutional Class | $1,000 | $1,164.50 | $0.00 | 0.00%(3) | $3.54 | 0.66% |
Advisor Class | $1,000 | $1,160.90 | $2.41 | 0.45% | $5.95 | 1.11% |
R Class | $1,000 | $1,161.10 | $3.75 | 0.70% | $7.29 | 1.36% |
Hypothetical | ||||||
Investor Class | $1,000 | $1,023.80 | $1.00 | 0.20% | $4.31 | 0.86% |
Institutional Class | $1,000 | $1,024.79 | $0.00 | 0.00%(3) | $3.31 | 0.66% |
Advisor Class | $1,000 | $1,022.56 | $2.26 | 0.45% | $5.56 | 1.11% |
R Class | $1,000 | $1,021.32 | $3.51 | 0.70% | $6.80 | 1.36% |
LIVESTRONG 2030 Portfolio | ||||||
Actual | ||||||
Investor Class | $1,000 | $1,173.70 | $1.08 | 0.20% | $4.80 | 0.89% |
Institutional Class | $1,000 | $1,176.90 | $0.00 | 0.00%(3) | $3.72 | 0.69% |
Advisor Class | $1,000 | $1,174.00 | $2.43 | 0.45% | $6.14 | 1.14% |
R Class | $1,000 | $1,172.50 | $3.77 | 0.70% | $7.49 | 1.39% |
Hypothetical | ||||||
Investor Class | $1,000 | $1,023.80 | $1.00 | 0.20% | $4.46 | 0.89% |
Institutional Class | $1,000 | $1,024.79 | $0.00 | 0.00%(3) | $3.46 | 0.69% |
Advisor Class | $1,000 | $1,022.56 | $2.26 | 0.45% | $5.71 | 1.14% |
R Class | $1,000 | $1,021.32 | $3.51 | 0.70% | $6.95 | 1.39% |
(1) | Expenses are equal to the class’s annualized expense ratio listed in the table above, multiplied by the average account value over the period, multiplied by 181, the number of days in the most recent fiscal half-year, divided by 365, to reflect the one-half year period. The fees and expenses of the underlying American Century Investments funds in which the fund invests are not included in the class’s annualized expense ratio. |
(2) | Effective expenses reflect the sum of expenses borne directly by the class plus the fund’s pro rata share of the weighted average expense ratio of the underlying funds in which it invests. The effective annualized expense ratio combines the class’s annualized expense ratio and the annualized weighted average expense ratio of the underlying funds. The annualized weighted average expense ratio of the underlying funds for the one-half year period reflects the actual expense ratio of each underlying fund from its most recent shareholder report, annualized and weighted for the fund’s relative average investment therein during the period. |
(3) | Other expenses, which include the fees and expenses of the fund’s independent directors and its legal counsel, as well as interest, did not exceed 0.005%. |
21
Effective | ||||||
Expenses | Expenses | |||||
Beginning | Ending | Paid During | Paid During | Effective | ||
Account | Account | Period(1) | Annualized | Period(2) | Annualized | |
Value | Value | 2/1/09 – | Expense | 2/1/09 – | Expense | |
2/1/09 | 7/31/09 | 7/31/09 | Ratio(1) | 7/31/09 | Ratio(2) | |
LIVESTRONG 2035 Portfolio | ||||||
Actual | ||||||
Investor Class | $1,000 | $1,186.40 | $1.08 | 0.20% | $4.99 | 0.92% |
Institutional Class | $1,000 | $1,188.80 | $0.00 | 0.00%(3) | $3.91 | 0.72% |
Advisor Class | $1,000 | $1,185.10 | $2.44 | 0.45% | $6.34 | 1.17% |
R Class | $1,000 | $1,183.90 | $3.79 | 0.70% | $7.69 | 1.42% |
Hypothetical | ||||||
Investor Class | $1,000 | $1,023.80 | $1.00 | 0.20% | $4.61 | 0.92% |
Institutional Class | $1,000 | $1,024.79 | $0.00 | 0.00%(3) | $3.61 | 0.72% |
Advisor Class | $1,000 | $1,022.56 | $2.26 | 0.45% | $5.86 | 1.17% |
R Class | $1,000 | $1,021.32 | $3.51 | 0.70% | $7.10 | 1.42% |
LIVESTRONG 2040 Portfolio | ||||||
Actual | ||||||
Investor Class | $1,000 | $1,199.70 | $1.09 | 0.20% | $5.13 | 0.94% |
Institutional Class | $1,000 | $1,199.70 | $0.00 | 0.00%(3) | $4.04 | 0.74% |
Advisor Class | $1,000 | $1,196.60 | $2.45 | 0.45% | $6.48 | 1.19% |
R Class | $1,000 | $1,196.90 | $3.81 | 0.70% | $7.84 | 1.44% |
Hypothetical | ||||||
Investor Class | $1,000 | $1,023.80 | $1.00 | 0.20% | $4.71 | 0.94% |
Institutional Class | $1,000 | $1,024.79 | $0.00 | 0.00%(3) | $3.71 | 0.74% |
Advisor Class | $1,000 | $1,022.56 | $2.26 | 0.45% | $5.96 | 1.19% |
R Class | $1,000 | $1,021.32 | $3.51 | 0.70% | $7.20 | 1.44% |
(1) | Expenses are equal to the class’s annualized expense ratio listed in the table above, multiplied by the average account value over the period, multiplied by 181, the number of days in the most recent fiscal half-year, divided by 365, to reflect the one-half year period. The fees and expenses of the underlying American Century Investments funds in which the fund invests are not included in the class’s annualized expense ratio. |
(2) | Effective expenses reflect the sum of expenses borne directly by the class plus the fund’s pro rata share of the weighted average expense ratio of the underlying funds in which it invests. The effective annualized expense ratio combines the class’s annualized expense ratio and the annualized weighted average expense ratio of the underlying funds. The annualized weighted average expense ratio of the underlying funds for the one-half year period reflects the actual expense ratio of each underlying fund from its most recent shareholder report, annualized and weighted for the fund’s relative average investment therein during the period. |
(3) | Other expenses, which include the fees and expenses of the fund’s independent directors and its legal counsel, as well as interest, did not exceed 0.005%. |
22
Effective | ||||||
Expenses | Expenses | |||||
Beginning | Ending | Paid During | Paid During | Effective | ||
Account | Account | Period(1) | Annualized | Period(2) | Annualized | |
Value | Value | 2/1/09 – | Expense | 2/1/09 – | Expense | |
2/1/09 | 7/31/09 | 7/31/09 | Ratio(1) | 7/31/09 | Ratio(2) | |
LIVESTRONG 2045 Portfolio | ||||||
Actual | ||||||
Investor Class | $1,000 | $1,204.80 | $1.09 | 0.20% | $5.25 | 0.96% |
Institutional Class | $1,000 | $1,206.00 | $0.00 | 0.00%(3) | $4.16 | 0.76% |
Advisor Class | $1,000 | $1,203.80 | $2.46 | 0.45% | $6.61 | 1.21% |
R Class | $1,000 | $1,202.50 | $3.82 | 0.70% | $7.97 | 1.46% |
Hypothetical | ||||||
Investor Class | $1,000 | $1,023.80 | $1.00 | 0.20% | $4.81 | 0.96% |
Institutional Class | $1,000 | $1,024.79 | $0.00 | 0.00%(3) | $3.81 | 0.76% |
Advisor Class | $1,000 | $1,022.56 | $2.26 | 0.45% | $6.06 | 1.21% |
R Class | $1,000 | $1,021.32 | $3.51 | 0.70% | $7.30 | 1.46% |
LIVESTRONG 2050 Portfolio | ||||||
Actual | ||||||
Investor Class | $1,000 | $1,207.10 | $1.09 | 0.20% | $5.31 | 0.97% |
Institutional Class | $1,000 | $1,208.70 | $0.00 | 0.00%(3) | $4.22 | 0.77% |
Advisor Class | $1,000 | $1,207.50 | $2.46 | 0.45% | $6.68 | 1.22% |
R Class | $1,000 | $1,205.80 | $3.83 | 0.70% | $8.04 | 1.47% |
Hypothetical | ||||||
Investor Class | $1,000 | $1,023.80 | $1.00 | 0.20% | $4.86 | 0.97% |
Institutional Class | $1,000 | $1,024.79 | $0.00 | 0.00%(3) | $3.86 | 0.77% |
Advisor Class | $1,000 | $1,022.56 | $2.26 | 0.45% | $6.11 | 1.22% |
R Class | $1,000 | $1,021.32 | $3.51 | 0.70% | $7.35 | 1.47% |
(1) | Expenses are equal to the class’s annualized expense ratio listed in the table above, multiplied by the average account value over the period, multiplied by 181, the number of days in the most recent fiscal half-year, divided by 365, to reflect the one-half year period. The fees and expenses of the underlying American Century Investments funds in which the fund invests are not included in the class’s annualized expense ratio. |
(2) | Effective expenses reflect the sum of expenses borne directly by the class plus the fund’s pro rata share of the weighted average expense ratio of the underlying funds in which it invests. The effective annualized expense ratio combines the class’s annualized expense ratio and the annualized weighted average expense ratio of the underlying funds. The annualized weighted average expense ratio of the underlying funds for the one-half year period reflects the actual expense ratio of each underlying fund from its most recent shareholder report, annualized and weighted for the fund’s relative average investment therein during the period. |
(3) | Other expenses, which include the fees and expenses of the fund’s independent directors and its legal counsel, as well as interest, did not exceed 0.005%. |
23
Schedule of Investments |
LIVESTRONG Portfolios |
JULY 31, 2009 | ||||||||
Shares | Value | Shares | Value | |||||
LIVESTRONG Income Portfolio | LIVESTRONG 2015 Portfolio | |||||||
Mutual Funds(1) — 100.0% | Mutual Funds(1) — 100.0% | |||||||
DOMESTIC EQUITY FUNDS — 41.0% | DOMESTIC EQUITY FUNDS — 44.5% | |||||||
NT Equity Growth Fund | NT Equity Growth Fund | |||||||
Institutional Class | 2,787,244 | $ 21,183,054 | Institutional Class | 5,557,150 | $ 42,234,340 | |||
NT Growth Fund | NT Growth Fund | |||||||
Institutional Class | 1,191,828 | 10,619,188 | Institutional Class | 3,048,884 | 27,165,556 | |||
NT Large Company Value | NT Large Company Value | |||||||
Fund Institutional Class | 2,563,045 | 17,633,750 | Fund Institutional Class | 5,426,807 | 37,336,432 | |||
NT Mid Cap Value Fund | NT Mid Cap Value Fund | |||||||
Institutional Class | 826,168 | 6,526,727 | Institutional Class | 2,141,941 | 16,921,334 | |||
NT Small Company Fund | NT Small Company Fund | |||||||
Institutional Class | 545,562 | 3,300,650 | Institutional Class | 1,128,158 | 6,825,356 | |||
NT Vista Fund | NT Vista Fund | |||||||
Institutional Class(2) | 531,826 | 3,988,695 | Institutional Class(2) | 1,643,618 | 12,327,135 | |||
Real Estate Fund | Real Estate Fund | |||||||
Institutional Class | 138,750 | 1,526,250 | Institutional Class | 367,873 | 4,046,603 | |||
64,778,314 | 146,856,756 | |||||||
DOMESTIC FIXED INCOME FUNDS — 36.9% | DOMESTIC FIXED INCOME FUNDS — 35.0% | |||||||
High-Yield Fund | High-Yield Fund | |||||||
Institutional Class | 1,118,004 | 6,093,122 | Institutional Class | 2,206,883 | 12,027,512 | |||
Inflation-Adjusted Bond | Inflation-Adjusted Bond | |||||||
Fund Institutional Class | 1,050,025 | 11,697,278 | Fund Institutional Class | 2,088,019 | 23,260,532 | |||
NT Diversified Bond Fund | NT Diversified Bond Fund | |||||||
Institutional Class | 3,920,806 | 40,658,758 | Institutional Class | 7,755,907 | 80,428,756 | |||
58,449,158 | 115,716,800 | |||||||
MONEY MARKET FUNDS — 9.5% | INTERNATIONAL EQUITY FUNDS — 8.0% | |||||||
Premium Money Market | NT Emerging Markets Fund | |||||||
Fund Investor Class | 15,019,816 | 15,019,816 | Institutional Class | 599,683 | 4,629,553 | |||
INTERNATIONAL FIXED INCOME FUNDS — 7.1% | NT International Growth | |||||||
International Bond Fund | Fund Institutional Class | 2,761,408 | 21,732,281 | |||||
Institutional Class | 761,308 | 11,282,585 | 26,361,834 | |||||
INTERNATIONAL EQUITY FUNDS — 5.5% | MONEY MARKET FUNDS — 6.6% | |||||||
NT International Growth | Premium Money Market | |||||||
Fund Institutional Class | 1,102,468 | 8,676,423 | Fund Investor Class | 21,866,634 | 21,866,634 | |||
TOTAL INVESTMENT | INTERNATIONAL FIXED INCOME FUNDS — 5.9% | |||||||
SECURITIES — 100.0% | International Bond Fund | |||||||
(Cost $148,316,494) | 158,206,296 | Institutional Class | 1,320,292 | 19,566,727 | ||||
OTHER ASSETS AND LIABILITIES(3) | (9,504) | TOTAL INVESTMENT | ||||||
TOTAL NET ASSETS — 100.0% | $158,196,792 | SECURITIES — 100.0% | ||||||
(Cost $329,115,394) | 330,368,751 | |||||||
Notes to Schedule of Investments | OTHER ASSETS AND LIABILITIES(3) | (18,789) | ||||||
(1) | Investments are funds within the American Century Investments | TOTAL NET ASSETS — 100.0% | $330,349,962 | |||||
family of funds, of which certain funds may be deemed to be under | ||||||||
common control because of the same board of directors. | Notes to Schedule of Investments | |||||||
(2) | Non-income producing. | (1) | Investments are funds within the American Century Investments | |||||
(3) | Category is less than 0.05% of total net assets. | family of funds, of which certain funds may be deemed to be under | ||||||
common control because of the same board of directors. | ||||||||
(2) | Non-income producing. | |||||||
See Notes to Financial Statements. | (3) | Category is less than 0.05% of total net assets. |
24
LIVESTRONG Portfolios | ||||||||
Shares | Value | Shares | Value | |||||
LIVESTRONG 2020 Portfolio | LIVESTRONG 2025 Portfolio | |||||||
Mutual Funds(1) — 100.0% | Mutual Funds(1) — 100.0% | |||||||
DOMESTIC EQUITY FUNDS — 47.6% | DOMESTIC EQUITY FUNDS — 51.5% | |||||||
NT Equity Growth Fund | NT Equity Growth Fund | |||||||
Institutional Class | 1,970,129 | $ 14,972,980 | Institutional Class | 7,648,927 | $ 58,131,845 | |||
NT Growth Fund | NT Growth Fund | |||||||
Institutional Class | 1,274,756 | 11,358,076 | Institutional Class | 5,769,287 | 51,404,347 | |||
NT Large Company Value | NT Large Company Value | |||||||
Fund Institutional Class | 2,008,361 | 13,817,524 | Fund Institutional Class | 7,968,242 | 54,821,505 | |||
NT Mid Cap Value Fund | NT Mid Cap Value Fund | |||||||
Institutional Class | 852,435 | 6,734,236 | Institutional Class | 3,096,495 | 24,462,311 | |||
NT Small Company Fund | NT Small Company Fund | |||||||
Institutional Class | 510,117 | 3,086,208 | Institutional Class | 2,718,383 | 16,446,217 | |||
NT Vista Fund | NT Vista Fund | |||||||
Institutional Class(2) | 714,014 | 5,355,105 | Institutional Class(2) | 3,018,698 | 22,640,235 | |||
Real Estate Fund | Real Estate Fund | |||||||
Institutional Class | 159,305 | 1,752,355 | Institutional Class | 703,700 | 7,740,700 | |||
57,076,484 | 235,647,160 | |||||||
DOMESTIC FIXED INCOME FUNDS — 33.0% | DOMESTIC FIXED INCOME FUNDS — 29.5% | |||||||
High-Yield Fund | High-Yield Fund | |||||||
Institutional Class | 754,254 | 4,110,684 | Institutional Class | 2,529,543 | 13,786,009 | |||
Inflation-Adjusted Bond | Inflation-Adjusted Bond | |||||||
Fund Institutional Class | 708,859 | 7,896,689 | Fund Institutional Class | 2,456,206 | 27,362,135 | |||
NT Diversified Bond Fund | NT Diversified Bond Fund | |||||||
Institutional Class | 2,664,978 | 27,635,822 | Institutional Class | 9,068,819 | 94,043,653 | |||
39,643,195 | 135,191,797 | |||||||
INTERNATIONAL EQUITY FUNDS — 10.1% | INTERNATIONAL EQUITY FUNDS — 12.3% | |||||||
NT Emerging Markets Fund | NT Emerging Markets Fund | |||||||
Institutional Class | 389,234 | 3,004,887 | Institutional Class | 1,813,244 | 13,998,244 | |||
NT International Growth | NT International Growth | |||||||
Fund Institutional Class | 1,162,977 | 9,152,629 | Fund Institutional Class | 5,378,530 | 42,329,031 | |||
12,157,516 | 56,327,275 | |||||||
MONEY MARKET FUNDS — 4.7% | MONEY MARKET FUNDS — 4.7% | |||||||
Premium Money Market | Premium Money Market | |||||||
Fund Investor Class | 5,659,565 | 5,659,565 | Fund Investor Class | 21,493,826 | 21,493,826 | |||
INTERNATIONAL FIXED INCOME FUNDS — 4.6% | INTERNATIONAL FIXED INCOME FUNDS — 2.0% | |||||||
International Bond Fund | International Bond Fund | |||||||
Institutional Class | 370,258 | 5,487,224 | Institutional Class | 625,811 | 9,274,519 | |||
TOTAL INVESTMENT | TOTAL INVESTMENT | |||||||
SECURITIES — 100.0% | SECURITIES — 100.0% | |||||||
(Cost $110,252,339) | 120,023,984 | (Cost $469,536,340) | 457,934,577 | |||||
OTHER ASSETS AND LIABILITIES(3) | (6,432) | OTHER ASSETS AND LIABILITIES(3) | (20,902) | |||||
TOTAL NET ASSETS — 100.0% | $120,017,552 | TOTAL NET ASSETS — 100.0% | $457,913,675 | |||||
Notes to Schedule of Investments | Notes to Schedule of Investments | |||||||
(1) | Investments are funds within the American Century Investments | (1) | Investments are funds within the American Century Investments | |||||
family of funds, of which certain funds may be deemed to be under | family of funds, of which certain funds may be deemed to be under | |||||||
common control because of the same board of directors. | common control because of the same board of directors. | |||||||
(2) | Non-income producing. | (2) | Non-income producing. | |||||
(3) | Category is less than 0.05% of total net assets. | (3) | Category is less than 0.05% of total net assets. | |||||
See Notes to Financial Statements. |
25
LIVESTRONG Portfolios | ||||||||
Shares | Value | Shares | Value | |||||
LIVESTRONG 2030 Portfolio | LIVESTRONG 2035 Portfolio | |||||||
Mutual Funds(1) — 100.0% | Mutual Funds(1) — 100.0% | |||||||
DOMESTIC EQUITY FUNDS — 55.8% | DOMESTIC EQUITY FUNDS — 60.7% | |||||||
NT Equity Growth Fund | NT Equity Growth Fund | |||||||
Institutional Class | 1,610,477 | $ 12,239,625 | Institutional Class | 4,750,635 | $ 36,104,826 | |||
NT Growth Fund | NT Growth Fund | |||||||
Institutional Class | 1,380,021 | 12,295,987 | Institutional Class | 4,071,949 | 36,281,066 | |||
NT Large Company Value | NT Large Company Value | |||||||
Fund Institutional Class | 1,748,426 | 12,029,171 | Fund Institutional Class | 5,155,073 | 35,466,902 | |||
NT Mid Cap Value Fund | NT Mid Cap Value Fund | |||||||
Institutional Class | 669,431 | 5,288,505 | Institutional Class | 2,164,783 | 17,101,786 | |||
NT Small Company Fund | NT Small Company Fund | |||||||
Institutional Class | 681,259 | 4,121,617 | Institutional Class | 1,819,959 | 11,010,752 | |||
NT Vista Fund | NT Vista Fund | |||||||
Institutional Class(2) | 685,954 | 5,144,655 | Institutional Class(2) | 2,216,542 | 16,624,065 | |||
Real Estate Fund | Real Estate Fund | |||||||
Institutional Class | 165,791 | 1,823,701 | Institutional Class | 508,499 | 5,593,489 | |||
52,943,261 | 158,182,886 | |||||||
DOMESTIC FIXED INCOME FUNDS — 25.8% | DOMESTIC FIXED INCOME FUNDS — 22.0% | |||||||
High-Yield Fund | High-Yield Fund | |||||||
Institutional Class | 461,025 | 2,512,586 | Institutional Class | 1,094,665 | 5,965,924 | |||
Inflation-Adjusted Bond | Inflation-Adjusted Bond | |||||||
Fund Institutional Class | 441,440 | 4,917,642 | Fund Institutional Class | 1,029,010 | 11,463,171 | |||
NT Diversified Bond Fund | NT Diversified Bond Fund | |||||||
Institutional Class | 1,645,852 | 17,067,485 | Institutional Class | 3,846,878 | 39,892,125 | |||
24,497,713 | 57,321,220 | |||||||
INTERNATIONAL EQUITY FUNDS — 14.2% | INTERNATIONAL EQUITY FUNDS — 15.5% | |||||||
NT Emerging Markets Fund | NT Emerging Markets Fund | |||||||
Institutional Class | 475,805 | 3,673,215 | Institutional Class | 1,582,020 | 12,213,194 | |||
NT International Growth | NT International Growth | |||||||
Fund Institutional Class | 1,239,635 | 9,755,927 | Fund Institutional Class | 3,572,561 | 28,116,055 | |||
13,429,142 | 40,329,249 | |||||||
MONEY MARKET FUNDS — 4.2% | MONEY MARKET FUNDS — 1.8% | |||||||
Premium Money Market | Premium Money Market | |||||||
Fund Investor Class | 3,994,174 | 3,994,174 | Fund Investor Class | 4,854,883 | 4,854,883 | |||
TOTAL INVESTMENT | TOTAL INVESTMENT | |||||||
SECURITIES — 100.0% | SECURITIES — 100.0% | |||||||
(Cost $86,260,847) | 94,864,290 | (Cost $275,071,772) | 260,688,238 | |||||
OTHER ASSETS AND LIABILITIES(3) | (3,715) | OTHER ASSETS AND LIABILITIES(3) | (8,013) | |||||
TOTAL NET ASSETS — 100.0% | $94,860,575 | TOTAL NET ASSETS — 100.0% | $260,680,225 | |||||
Notes to Schedule of Investments | Notes to Schedule of Investments | |||||||
(1) | Investments are funds within the American Century Investments | (1) | Investments are funds within the American Century Investments | |||||
family of funds, of which certain funds may be deemed to be under | family of funds, of which certain funds may be deemed to be under | |||||||
common control because of the same board of directors. | common control because of the same board of directors. | |||||||
(2) | Non-income producing. | (2) | Non-income producing. | |||||
(3) | Category is less than 0.05% of total net assets. | (3) | Category is less than 0.05% of total net assets. | |||||
See Notes to Financial Statements. |
26
LIVESTRONG Portfolios | ||||||||
Shares | Value | Shares | Value | |||||
LIVESTRONG 2040 Portfolio | LIVESTRONG 2045 Portfolio | |||||||
Mutual Funds(1) — 100.0% | Mutual Funds(1) — 100.0% | |||||||
DOMESTIC EQUITY FUNDS — 64.7% | DOMESTIC EQUITY FUNDS — 66.1% | |||||||
NT Equity Growth Fund | NT Equity Growth Fund | |||||||
Institutional Class | 747,682 | $ 5,682,383 | Institutional Class | 2,764,185 | $ 21,007,806 | |||
NT Growth Fund | NT Growth Fund | |||||||
Institutional Class | 625,447 | 5,572,733 | Institutional Class | 2,369,786 | 21,114,793 | |||
NT Large Company Value | NT Large Company Value | |||||||
Fund Institutional Class | 792,721 | 5,453,920 | Fund Institutional Class | 3,049,782 | 20,982,500 | |||
NT Mid Cap Value Fund | NT Mid Cap Value Fund | |||||||
Institutional Class | 351,915 | 2,780,129 | Institutional Class | 1,309,619 | 10,345,990 | |||
NT Small Company Fund | NT Small Company Fund | |||||||
Institutional Class | 255,667 | 1,546,785 | Institutional Class | 1,129,878 | 6,835,762 | |||
NT Vista Fund | NT Vista Fund | |||||||
Institutional Class(2) | 360,843 | 2,706,323 | Institutional Class(2) | 1,341,136 | 10,058,520 | |||
Real Estate Fund | Real Estate Fund | |||||||
Institutional Class | 82,564 | 908,204 | Institutional Class | 335,863 | 3,694,493 | |||
24,650,477 | 94,039,864 | |||||||
DOMESTIC FIXED INCOME FUNDS — 18.6% | INTERNATIONAL EQUITY FUNDS — 17.6% | |||||||
High-Yield Fund | NT Emerging Markets Fund | |||||||
Institutional Class | 135,139 | 736,507 | Institutional Class | 1,262,828 | 9,749,032 | |||
Inflation-Adjusted Bond | NT International Growth | |||||||
Fund Institutional Class | 127,038 | 1,415,203 | Fund Institutional Class | 1,938,885 | 15,259,025 | |||
NT Diversified Bond Fund | 25,008,057 | |||||||
Institutional Class | 477,499 | 4,951,665 | DOMESTIC FIXED INCOME FUNDS — 16.3% | |||||
7,103,375 | High-Yield Fund | |||||||
INTERNATIONAL EQUITY FUNDS — 16.7% | Institutional Class | 438,751 | 2,391,193 | |||||
NT Emerging Markets Fund | Inflation-Adjusted Bond | |||||||
Institutional Class | 283,654 | 2,189,809 | Fund Institutional Class | 412,461 | 4,594,816 | |||
NT International Growth | NT Diversified Bond Fund | |||||||
Fund Institutional Class | 531,961 | 4,186,533 | Institutional Class | 1,562,796 | 16,206,195 | |||
6,376,342 | 23,192,204 | |||||||
TOTAL INVESTMENT | TOTAL INVESTMENT | |||||||
SECURITIES — 100.0% | SECURITIES — 100.0% | |||||||
(Cost $34,051,643) | 38,130,194 | (Cost $156,424,789) | 142,240,125 | |||||
OTHER ASSETS AND LIABILITIES(3) | (935) | OTHER ASSETS AND LIABILITIES(3) | (2,866) | |||||
TOTAL NET ASSETS — 100.0% | $38,129,259 | TOTAL NET ASSETS — 100.0% | $142,237,259 | |||||
Notes to Schedule of Investments | Notes to Schedule of Investments | |||||||
(1) | Investments are funds within the American Century Investments | (1) | Investments are funds within the American Century Investments | |||||
family of funds, of which certain funds may be deemed to be under | family of funds, of which certain funds may be deemed to be under | |||||||
common control because of the same board of directors. | common control because of the same board of directors. | |||||||
(2) | Non-income producing. | (2) | Non-income producing. | |||||
(3) | Category is less than 0.05% of total net assets. | (3) | Category is less than 0.05% of total net assets. | |||||
See Notes to Financial Statements. |
27
LIVESTRONG Portfolios | |||
Shares | Value | ||
LIVESTRONG 2050 Portfolio | |||
Mutual Funds(1) — 100.0% | |||
DOMESTIC EQUITY FUNDS — 68.6% | |||
NT Equity Growth Fund | |||
Institutional Class | 143,676 | $ 1,091,938 | |
NT Growth Fund | |||
Institutional Class | 123,025 | 1,096,153 | |
NT Large Company Value | |||
Fund Institutional Class | 158,713 | 1,091,945 | |
NT Mid Cap Value Fund | |||
Institutional Class | 68,107 | 538,045 | |
NT Small Company Fund | |||
Institutional Class | 59,816 | 361,887 | |
NT Vista Fund | |||
Institutional Class(2) | 70,010 | 525,075 | |
Real Estate Fund | |||
Institutional Class | 18,270 | 200,970 | |
4,906,013 | |||
INTERNATIONAL EQUITY FUNDS — 17.2% | |||
NT Emerging Markets Fund | |||
Institutional Class | 65,640 | 506,741 | |
NT International Growth | |||
Fund Institutional Class | 92,205 | 725,653 | |
1,232,394 | |||
DOMESTIC FIXED INCOME FUNDS — 14.2% | |||
High-Yield Fund | |||
Institutional Class | 19,414 | 105,806 | |
Inflation-Adjusted Bond | |||
Fund Institutional Class | 18,277 | 203,606 | |
NT Diversified Bond Fund | |||
Institutional Class | 68,273 | 707,991 | |
1,017,403 | |||
TOTAL INVESTMENT | |||
SECURITIES — 100.0% | |||
(Cost $6,387,687) | 7,155,810 | ||
OTHER ASSETS AND LIABILITIES(3) | (79) | ||
TOTAL NET ASSETS — 100.0% | $7,155,731 | ||
Notes to Schedule of Investments | |||
(1) | Investments are funds within the American Century Investments | ||
family of funds, of which certain funds may be deemed to be under | |||
common control because of the same board of directors. | |||
(2) | Non-income producing. | ||
(3) | Category is less than 0.05% of total net assets. | ||
See Notes to Financial Statements. |
28
Statement of Assets and Liabilities |
JULY 31, 2009 | |||||
LIVESTRONG | LIVESTRONG | LIVESTRONG | |||
Income Portfolio | 2015 Portfolio | 2020 Portfolio | |||
Assets | |||||
Investment securities in affiliates, at value | |||||
(cost of $148,316,494, $329,115,394 and | |||||
$110,252,339, respectively) | $158,206,296 | $330,368,751 | $120,023,984 | ||
Cash | 29,090 | 55,321 | 17,159 | ||
Receivable for capital shares sold | 406,479 | 511,306 | 467,316 | ||
Distributions receivable from affiliates | 169,306 | 332,096 | 112,420 | ||
158,811,171 | 331,267,474 | 120,620,879 | |||
Liabilities | |||||
Payable for investments purchased | 304,462 | 402,426 | 570,001 | ||
Payable for capital shares redeemed | 279,873 | 457,865 | 15,612 | ||
Accrued administrative fees | 21,784 | 43,997 | 15,803 | ||
Distribution and service fees payable | 8,260 | 13,224 | 1,911 | ||
614,379 | 917,512 | 603,327 | |||
Net Assets | $158,196,792 | $330,349,962 | $120,017,552 | ||
Net Assets Consist of: | |||||
Capital (par value and paid-in surplus) | $161,062,706 | $345,230,893 | $111,618,599 | ||
Undistributed net investment income | 151,679 | 2,488,864 | 892,096 | ||
Accumulated net realized loss on investment transactions | (12,907,395) | (18,623,152) | (2,264,788) | ||
Net unrealized appreciation on investments | 9,889,802 | 1,253,357 | 9,771,645 | ||
$158,196,792 | $330,349,962 | $120,017,552 | |||
Investor Class, $0.01 Par Value | |||||
Net assets | $95,441,073 | $217,148,825 | $91,329,413 | ||
Shares outstanding | 10,017,877 | 22,000,366 | 10,782,569 | ||
Net asset value per share | $9.53 | $9.87 | $8.47 | ||
Institutional Class, $0.01 Par Value | |||||
Net assets | $25,087,837 | $59,499,603 | $21,531,606 | ||
Shares outstanding | 2,633,060 | 6,017,833 | 2,540,615 | ||
Net asset value per share | $9.53 | $9.89 | $8.47 | ||
Advisor Class, $0.01 Par Value | |||||
Net assets | $34,202,074 | $40,385,844 | $3,882,348 | ||
Shares outstanding | 3,590,588 | 4,097,592 | 459,213 | ||
Net asset value per share | $9.53 | $9.86 | $8.45 | ||
R Class, $0.01 Par Value | |||||
Net assets | $3,465,808 | $13,315,690 | $3,274,185 | ||
Shares outstanding | 364,045 | 1,352,741 | 387,767 | ||
Net asset value per share | $9.52 | $9.84 | $8.44 | ||
See Notes to Financial Statements. |
29
JULY 31, 2009 | |||
LIVESTRONG | LIVESTRONG | LIVESTRONG | |
2025 Portfolio | 2030 Portfolio | 2035 Portfolio | |
Assets | |||
Investment securities in affiliates, at value | |||
(cost of $469,536,340, $86,260,847 | |||
and $275,071,772, respectively) | $457,934,577 | $94,864,290 | $260,688,238 |
Cash | 74,096 | 13,896 | 42,957 |
Receivable for capital shares sold | 1,074,594 | 351,996 | 394,043 |
Distributions receivable from affiliates | 383,373 | 69,936 | 162,077 |
459,466,640 | 95,300,118 | 261,287,315 | |
Liabilities | |||
Payable for investments purchased | 1,102,511 | 407,971 | 449,448 |
Payable for capital shares redeemed | 373,781 | 17,223 | 113,181 |
Accrued administrative fees | 60,920 | 12,429 | 34,036 |
Distribution and service fees payable | 15,753 | 1,920 | 10,425 |
1,552,965 | 439,543 | 607,090 | |
Net Assets | $457,913,675 | $94,860,575 | $260,680,225 |
Net Assets Consist of: | |||
Capital (par value and paid-in surplus) | $487,080,573 | $87,446,499 | $285,902,675 |
Undistributed net investment income | 3,057,750 | 607,150 | 1,510,022 |
Accumulated net realized loss on investment transactions | (20,622,885) | (1,796,517) | (12,348,938) |
Net unrealized appreciation (depreciation) on investments | (11,601,763) | 8,603,443 | (14,383,534) |
$457,913,675 | $94,860,575 | $260,680,225 | |
Investor Class, $0.01 Par Value | |||
Net assets | $313,816,095 | $70,381,505 | $170,455,486 |
Shares outstanding | 32,168,180 | 8,749,261 | 17,494,949 |
Net asset value per share | $9.76 | $8.04 | $9.74 |
Institutional Class, $0.01 Par Value | |||
Net assets | $78,030,691 | $17,527,920 | $46,543,546 |
Shares outstanding | 7,990,731 | 2,178,142 | 4,770,029 |
Net asset value per share | $9.77 | $8.05 | $9.76 |
Advisor Class, $0.01 Par Value | |||
Net assets | $49,722,611 | $3,377,980 | $32,896,353 |
Shares outstanding | 5,103,737 | 420,798 | 3,380,534 |
Net asset value per share | $9.74 | $8.03 | $9.73 |
R Class, $0.01 Par Value | |||
Net assets | $16,344,278 | $3,573,170 | $10,784,840 |
Shares outstanding | 1,680,175 | 445,671 | 1,109,715 |
Net asset value per share | $9.73 | $8.02 | $9.72 |
See Notes to Financial Statements. |
30
JULY 31, 2009 | |||
LIVESTRONG | LIVESTRONG | LIVESTRONG | |
2040 Portfolio | 2045 Portfolio | 2050 Portfolio | |
Assets | |||
Investment securities in affiliates, at value | |||
(cost of $34,051,643, $156,424,789 | |||
and $6,387,687, respectively) | $38,130,194 | $142,240,125 | $7,155,810 |
Cash | 5,482 | 21,661 | 769 |
Receivable for capital shares sold | 270,204 | 490,973 | 27,953 |
Distributions receivable from affiliates | 19,828 | 65,242 | 2,805 |
38,425,708 | 142,818,001 | 7,187,337 | |
Liabilities | |||
Payable for investments purchased | 264,313 | 512,505 | 20,358 |
Payable for capital shares redeemed | 26,507 | 45,893 | 10,500 |
Accrued administrative fees | 4,447 | 16,995 | 617 |
Distribution and service fees payable | 1,182 | 5,349 | 131 |
296,449 | 580,742 | 31,606 | |
Net Assets | $38,129,259 | $142,237,259 | $7,155,731 |
Net Assets Consist of: | |||
Capital (par value and paid-in surplus) | $34,603,320 | $164,669,911 | $6,650,329 |
Undistributed net investment income | 201,743 | 744,269 | 32,184 |
Accumulated net realized loss on investment transactions | (754,355) | (8,992,257) | (294,905) |
Net unrealized appreciation (depreciation) on investments | 4,078,551 | (14,184,664) | 768,123 |
$38,129,259 | $142,237,259 | $7,155,731 | |
Investor Class, $0.01 Par Value | |||
Net assets | $24,385,679 | $85,095,297 | $3,453,920 |
Shares outstanding | 3,148,205 | 8,873,884 | 462,933 |
Net asset value per share | $7.75 | $9.59 | $7.46 |
Institutional Class, $0.01 Par Value | |||
Net assets | $9,845,702 | $34,639,132 | $3,179,394 |
Shares outstanding | 1,270,296 | 3,607,251 | 425,535 |
Net asset value per share | $7.75 | $9.60 | $7.47 |
Advisor Class, $0.01 Par Value | |||
Net assets | $1,550,920 | $17,537,106 | $336,191 |
Shares outstanding | 200,583 | 1,831,841 | 45,136 |
Net asset value per share | $7.73 | $9.57 | $7.45 |
R Class, $0.01 Par Value | |||
Net assets | $2,346,958 | $4,965,724 | $186,226 |
Shares outstanding | 304,089 | 519,305 | 25,038 |
Net asset value per share | $7.72 | $9.56 | $7.44 |
See Notes to Financial Statements. |
31
Statement of Operations |
YEAR ENDED JULY 31, 2009 | |||
LIVESTRONG | LIVESTRONG | LIVESTRONG | |
Income Portfolio | 2015 Portfolio | 2020 Portfolio | |
Investment Income (Loss) | |||
Income: | |||
Income distributions from underlying funds — affiliates | $ 2,827,462 | $ 7,259,873 | $ 1,112,373 |
Expenses: | |||
Administrative fees | 172,808 | 424,742 | 103,021 |
Distribution and service fees: | |||
Advisor Class | 28,137 | 67,825 | 3,146 |
R Class | 8,863 | 41,188 | 5,861 |
Directors’ fees and expenses | 3,868 | 9,886 | 1,903 |
213,676 | 543,641 | 113,931 | |
Net investment income (loss) | 2,613,786 | 6,716,232 | 998,442 |
Net Realized and Unrealized Gain (Loss) on Affiliates | |||
Net realized gain (loss) on: | |||
Sale of investments in underlying funds | (12,394,796) | (17,601,459) | (2,281,855) |
Capital gain distributions received from underlying funds | 170,959 | 496,675 | 16,355 |
(12,223,837) | (17,104,784) | (2,265,500) | |
Change in net unrealized appreciation (depreciation) | |||
on investments in underlying funds | 9,836,410 | 1,797,021 | 9,783,711 |
Net realized and unrealized gain (loss) on affiliates | (2,387,427) | (15,307,763) | 7,518,211 |
Net Increase (Decrease) in Net Assets | |||
Resulting from Operations | $ 226,359 | $ (8,591,531) | $ 8,516,653 |
See Notes to Financial Statements. |
32
YEAR ENDED JULY 31, 2009 | |||
LIVESTRONG | LIVESTRONG | LIVESTRONG | |
2025 Portfolio | 2030 Portfolio | 2035 Portfolio | |
Investment Income (Loss) | |||
Income: | |||
Income distributions from underlying funds — affiliates | $ 8,654,593 | $ 763,286 | $ 4,321,216 |
Expenses: | |||
Administrative fees | 560,376 | 79,095 | 317,368 |
Distribution and service fees: | |||
Advisor Class | 77,566 | 2,345 | 52,601 |
R Class | 33,651 | 7,968 | 23,168 |
Directors’ fees and expenses | 13,000 | 1,494 | 7,539 |
684,593 | 90,902 | 400,676 | |
Net investment income (loss) | 7,970,000 | 672,384 | 3,920,540 |
Net Realized and Unrealized Gain (Loss) on Affiliates | |||
Net realized gain (loss) on: | |||
Sale of investments in underlying funds | (18,863,738) | (1,806,456) | (11,295,125) |
Capital gain distributions received from underlying funds | 569,172 | 10,596 | 248,559 |
(18,294,566) | (1,795,860) | (11,046,566) | |
Change in net unrealized appreciation (depreciation) | |||
on investments in underlying funds | (8,435,503) | 8,609,759 | (10,372,689) |
Net realized and unrealized gain (loss) on affiliates | (26,730,069) | 6,813,899 | (21,419,255) |
Net Increase (Decrease) in Net Assets | |||
Resulting from Operations | $(18,760,069) | $7,486,283 | $(17,498,715) |
See Notes to Financial Statements. |
33
YEAR ENDED JULY 31, 2009 | |||
LIVESTRONG | LIVESTRONG | LIVESTRONG | |
2040 Portfolio | 2045 Portfolio | 2050 Portfolio | |
Investment Income (Loss) | |||
Income: | |||
Income distributions from underlying funds — affiliates | $ 266,963 | $ 2,358,477 | $ 55,582 |
Expenses: | |||
Administrative fees | 27,124 | 163,442 | 3,628 |
Distribution and service fees: | |||
Advisor Class | 1,231 | 28,899 | 154 |
R Class | 5,571 | 11,743 | 433 |
Directors’ fees and expenses | 580 | 4,399 | 106 |
34,506 | 208,483 | 4,321 | |
Net investment income (loss) | 232,457 | 2,149,994 | 51,261 |
Net Realized and Unrealized Gain (Loss) on Affiliates | |||
Net realized gain (loss) on: | |||
Sale of investments in underlying funds | (758,129) | (7,555,110) | (296,193) |
Capital gain distributions received from underlying funds | 3,811 | 116,143 | 1,904 |
(754,318) | (7,438,967) | (294,289) | |
Change in net unrealized appreciation (depreciation) | |||
on investments in underlying funds | 4,078,190 | (10,606,884) | 786,829 |
Net realized and unrealized gain (loss) on affiliates | 3,323,872 | (18,045,851) | 492,540 |
Net Increase (Decrease) in Net Assets | |||
Resulting from Operations | $3,556,329 | $(15,895,857) | $ 543,801 |
See Notes to Financial Statements. |
34
Statement of Changes in Net Assets |
YEARS ENDED JULY 31, 2009 AND JULY 31, 2008 | ||||
LIVESTRONG Income Portfolio | LIVESTRONG 2015 Portfolio | |||
Increase (Decrease) in Net Assets | 2009 | 2008 | 2009 | 2008 |
Operations | ||||
Net investment income (loss) | $ 2,613,786 | $ 2,364,664 | $ 6,716,232 | $ 6,986,331 |
Net realized gain (loss) | (12,223,837) | 136,900 | (17,104,784) | 1,570,407 |
Change in net unrealized | ||||
appreciation (depreciation) | 9,836,410 | (2,516,968) | 1,797,021 | (10,467,082) |
Net increase (decrease) in net assets | ||||
resulting from operations | 226,359 | (15,404) | (8,591,531) | (1,910,344) |
Distributions to Shareholders | ||||
From net investment income: | ||||
Investor Class | (1,891,448) | (1,807,377) | (5,150,679) | (5,029,481) |
Institutional Class | (380,646) | (358,453) | (667,576) | (526,172) |
Advisor Class | (249,615) | (251,073) | (842,999) | (486,532) |
R Class | (36,296) | (5,401) | (170,136) | (120,545) |
From net realized gains: | ||||
Investor Class | (405,727) | (100,501) | (1,965,341) | (582,593) |
Institutional Class | (79,352) | (18,324) | (241,939) | (57,480) |
Advisor Class | (72,879) | (12,887) | (344,341) | (60,961) |
R Class | (12,048) | (264) | (74,791) | (16,447) |
Decrease in net assets from distributions | (3,128,011) | (2,554,280) | (9,457,802) | (6,880,211) |
Capital Share Transactions | ||||
Net increase (decrease) in net assets | ||||
from capital share transactions | 93,346,171 | 9,686,579 | 140,167,568 | 39,105,101 |
Net increase (decrease) in net assets | 90,444,519 | 7,116,895 | 122,118,235 | 30,314,546 |
Net Assets | ||||
Beginning of period | 67,752,273 | 60,635,378 | 208,231,727 | 177,917,181 |
End of period | $158,196,792 | $67,752,273 | $330,349,962 | $208,231,727 |
Undistributed net investment income | $151,679 | $117,473 | $2,488,864 | $2,667,462 |
See Notes to Financial Statements. |
35
YEARS ENDED JULY 31, 2009 AND JULY 31, 2008 (EXCEPT AS NOTED) | ||||
LIVESTRONG 2020 Portfolio | LIVESTRONG 2025 Portfolio | |||
Increase (Decrease) in Net Assets | 2009 | 2008(1) | 2009 | 2008 |
Operations | ||||
Net investment income (loss) | $ 998,442 | $ 1,601 | $ 7,970,000 | $ 9,062,338 |
Net realized gain (loss) | (2,265,500) | (111) | (18,294,566) | 2,488,135 |
Change in net unrealized | ||||
appreciation (depreciation) | 9,783,711 | (12,066) | (8,435,503) | (19,833,288) |
Net increase (decrease) in net assets | ||||
resulting from operations | 8,516,653 | (10,576) | (18,760,069) | (8,282,815) |
Distributions to Shareholders | ||||
From net investment income: | ||||
Investor Class | (71,188) | — | (5,950,462) | (6,067,533) |
Institutional Class | (11,369) | — | (1,225,708) | (1,379,241) |
Advisor Class | (12,872) | — | (799,325) | (459,566) |
R Class | (11,706) | — | (135,485) | (45,611) |
From net realized gains: | ||||
Investor Class | — | — | (3,244,442) | (763,010) |
Institutional Class | — | — | (624,145) | (162,933) |
Advisor Class | — | — | (471,571) | (62,855) |
R Class | — | — | (87,038) | (6,836) |
Decrease in net assets from distributions | (107,135) | — | (12,538,176) | (8,947,585) |
Capital Share Transactions | ||||
Net increase (decrease) in net assets | ||||
from capital share transactions | 110,507,216 | 1,111,394 | 198,757,669 | 69,996,157 |
Net increase (decrease) in net assets | 118,916,734 | 1,100,818 | 167,459,424 | 52,765,757 |
Net Assets | ||||
Beginning of period | 1,100,818 | — | 290,454,251 | 237,688,494 |
End of period | $120,017,552 | $1,100,818 | $457,913,675 | $290,454,251 |
Undistributed net investment income | $892,096 | $1,601 | $3,057,750 | $3,274,706 |
(1) May 30, 2008 (fund inception) through July 31, 2008. | ||||
See Notes to Financial Statements. |
36
YEARS ENDED JULY 31, 2009 AND JULY 31, 2008 (EXCEPT AS NOTED) | ||||
LIVESTRONG 2030 Portfolio | LIVESTRONG 2035 Portfolio | |||
Increase (Decrease) in Net Assets | 2009 | 2008(1) | 2009 | 2008 |
Operations | ||||
Net investment income (loss) | $ 672,384 | $ 635 | $ 3,920,540 | $ 4,814,697 |
Net realized gain (loss) | (1,795,860) | (1,017) | (11,046,566) | 1,871,450 |
Change in net unrealized | ||||
appreciation (depreciation) | 8,609,759 | (6,316) | (10,372,689) | (14,197,827) |
Net increase (decrease) in net assets | ||||
resulting from operations | 7,486,283 | (6,698) | (17,498,715) | (7,511,680) |
Distributions to Shareholders | ||||
From net investment income: | ||||
Investor Class | (36,634) | — | (2,790,828) | (3,073,496) |
Institutional Class | (8,184) | — | (561,509) | (715,004) |
Advisor Class | (5,403) | — | (435,681) | (352,833) |
R Class | (15,299) | — | (73,773) | (45,651) |
From net realized gains: | ||||
Investor Class | — | — | (2,117,074) | (398,845) |
Institutional Class | — | — | (396,869) | (86,908) |
Advisor Class | — | — | (363,962) | (50,009) |
R Class | — | — | (68,580) | (7,128) |
Decrease in net assets from distributions | (65,520) | — | (6,808,276) | (4,729,874) |
Capital Share Transactions | ||||
Net increase (decrease) in net assets | ||||
from capital share transactions | 86,795,822 | 650,688 | 110,729,046 | 58,612,954 |
Net increase (decrease) in net assets | 94,216,585 | 643,990 | 86,422,055 | 46,371,400 |
Net Assets | ||||
Beginning of period | 643,990 | — | 174,258,170 | 127,886,770 |
End of period | $94,860,575 | $643,990 | $260,680,225 | $174,258,170 |
Undistributed net investment income | $607,150 | $635 | $1,510,022 | $1,485,029 |
(1) May 30, 2008 (fund inception) through July 31, 2008. | ||||
See Notes to Financial Statements. |
37
YEARS ENDED JULY 31, 2009 AND JULY 31, 2008 (EXCEPT AS NOTED) | ||||
LIVESTRONG 2040 Portfolio | LIVESTRONG 2045 Portfolio | |||
Increase (Decrease) in Net Assets | 2009 | 2008(1) | 2009 | 2008 |
Operations | ||||
Net investment income (loss) | $ 232,457 | $ 499 | $ 2,149,994 | $ 3,354,239 |
Net realized gain (loss) | (754,318) | (218) | (7,438,967) | 659,386 |
Change in net unrealized | ||||
appreciation (depreciation) | 4,078,190 | 361 | (10,606,884) | (11,088,022) |
Net increase (decrease) in net assets | ||||
resulting from operations | 3,556,329 | 642 | (15,895,857) | (7,074,397) |
Distributions to Shareholders | ||||
From net investment income: | ||||
Investor Class | (16,296) | — | (1,472,652) | (1,730,903) |
Institutional Class | (1,179) | — | (568,816) | (914,356) |
Advisor Class | (2,891) | — | (216,154) | (270,802) |
R Class | (10,677) | — | (30,172) | (24,577) |
From net realized gains: | ||||
Investor Class | — | — | (1,312,952) | (215,140) |
Institutional Class | — | — | (470,646) | (106,359) |
Advisor Class | — | — | (213,458) | (36,814) |
R Class | — | — | (33,394) | (3,687) |
Decrease in net assets from distributions | (31,043) | — | (4,318,244) | (3,302,638) |
Capital Share Transactions | ||||
Net increase (decrease) in net assets | ||||
from capital share transactions | 33,755,308 | 848,023 | 45,933,636 | 40,338,967 |
Net increase (decrease) in net assets | 37,280,594 | 848,665 | 25,719,535 | 29,961,932 |
Net Assets | ||||
Beginning of period | 848,665 | — | 116,517,724 | 86,555,792 |
End of period | $38,129,259 | $848,665 | $142,237,259 | $ 116,517,724 |
Undistributed net investment income | $201,743 | $499 | $744,269 | $899,532 |
(1) May 30, 2008 (fund inception) through July 31, 2008. | ||||
See Notes to Financial Statements. |
38
YEAR ENDED JULY 31, 2009 AND PERIOD ENDED JULY 31, 2008 | ||
LIVESTRONG 2050 Portfolio | ||
Increase (Decrease) in Net Assets | 2009 | 2008(1) |
Operations | ||
Net investment income (loss) | $ 51,261 | $ 547 |
Net realized gain (loss) | (294,289) | (707) |
Change in net unrealized appreciation (depreciation) | 786,829 | (18,706) |
Net increase (decrease) in net assets resulting from operations | 543,801 | (18,866) |
Distributions to Shareholders | ||
From net investment income: | ||
Investor Class | (8,507) | — |
Institutional Class | (10,356) | — |
Advisor Class | (179) | — |
R Class | (502) | — |
Decrease in net assets from distributions | (19,544) | — |
Capital Share Transactions | ||
Net increase (decrease) in net assets from capital share transactions | 6,149,716 | 500,624 |
Net increase (decrease) in net assets | 6,673,973 | 481,758 |
Net Assets | ||
Beginning of period | 481,758 | — |
End of period | $7,155,731 | $481,758 |
Undistributed net investment income | $32,184 | $547 |
(1) May 30, 2008 (fund inception) through July 31, 2008. | ||
See Notes to Financial Statements. |
39
Notes to Financial Statements |
JULY 31, 2009
1. Organization and Summary of Significant Accounting Policies
Organization — American Century Asset Allocation Portfolios, Inc. (the corporation) is registered under the Investment Company Act of 1940 (the 1940 Act), as amended, as an open-end management investment company. LIVESTRONG Income Portfolio, LIVESTRONG 2015 Portfolio, LIVESTRONG 2020 Portfolio, LIVESTRONG 2025 Portfolio, LIVESTRONG 2030 Portfolio, LIVESTRONG 2035 Portfolio, LIVESTRONG 2040 Portfolio, LIVESTRONG 2045 Portfolio and LIVESTRONG 2050 Portfolio (collectively, the funds) are nine funds in a series issued by the corporation. The funds operate as “fund of funds,” meaning substantially all of the funds’ assets will be invested in other funds in the American Century Investments family of funds (the underlying funds). The funds are diversified under the 1940 Act. Additionally, the underlying funds are generally diversified and so indirectly provide broad exposure to a large number of securities. The investment objective of LIVESTRONG Income Portfolio is to seek current income. Capital appreciation is a secondary objective. The investment objectives of the eight target-year LIVESTRONG Portfolios are to seek the highest total return consistent with their respective asset mix. The funds pursue their objectives by investing in underlying funds that represent a variety of asset classes and investment styles. For each fund with a target-year, the target asset mix will be adjusted annually in a step-like fashion. In general, as the target-year approaches, the allocation to stocks will decrease and the allocation to bonds and money market instruments will increase. When a fund reaches its most conservative planned target asset allocation, which is expected to occur on approximately November 30 of the year before the target year, its target asset mix will become fixed and will match that of LIVESTRONG Income Portfolio. The following is a summary of the funds’ significant accounting policies.
Multiple Class — The funds are authorized to issue the Investor Class, Institutional Class, Advisor Class and R Class. The share classes differ principally in their respective distribution and shareholder servicing expenses and arrangements. All shares of each fund represent an equal pro rata interest in the net assets of the class to which such shares belong, and have identical voting, dividend, liquidation and other rights and the same terms and conditions, except for class specific expenses and exclusive rights to vote on matters affecting only individual classes. Income, non-class specific expenses, and realized and unrealized capital gains and losses of the funds are allocated to each class of shares based on their relative net assets. All classes of LIVESTRONG 2020 Portfolio, LIVESTRONG 2030 Portfolio, LIVESTRONG 2040 Portfolio and LIVESTRONG 2050 Portfolio commenced sale on May 30, 2008, the funds’ inception date.
Underlying Funds — Each fund’s assets are allocated among underlying funds that represent major asset classes, including equity securities (stocks), fixed-income securities (bonds) and cash-equivalent instruments (money markets). The underlying funds are not permitted to invest in securities issued by companies assigned the Global Industry Classification Standard (GICS) for the tobacco industry. A brief description of each of the underlying funds follows.
Domestic Equity Funds
NT Equity Growth Fund seeks long-term capital growth. It uses a quantitative investment strategy to construct an optimized portfolio drawn primarily from large publicly traded U.S. companies without regard to dividend yield.
NT Growth Fund seeks long-term capital growth. It uses a growth investment strategy and generally invests in larger U.S. companies.
NT Large Company Value Fund seeks long-term capital growth with income as a secondary objective. It uses a value investment strategy and invests primarily in larger U.S. companies.
NT Mid Cap Value Fund seeks long-term capital growth with income as a secondary objective. It uses a value investment strategy and invests primarily in medium-sized U.S. companies.
40
NT Small Company Fund seeks long-term capital growth. It uses a quantitative investment strategy and invests primarily in smaller U.S. companies.
NT Vista Fund seeks long-term capital growth. It uses a growth investment strategy and generally invests in medium-sized and smaller U.S. companies.
Real Estate Fund seeks high total investment return through a combination of capital appreciation and current income. It invests primarily in equity securities issued by real estate investment trusts and companies engaged in the real estate industry.
International Equity Funds
NT Emerging Markets Fund seeks capital growth. It uses a growth investment strategy and invests primarily in securities of companies located in emerging market countries.
NT International Growth Fund seeks capital growth. It uses a growth investment strategy and invests primarily in securities of companies located in developed countries other than the United States.
Domestic Fixed Income Funds
High-Yield Fund seeks high current income by investing in a diversified portfolio of high-yield corporate bonds and other debt securities. As a secondary objective, the fund seeks capital appreciation, but only when consistent with its primary objective of maximizing current income.
Inflation-Adjusted Bond Fund seeks to provide total return and inflation protection consistent with investment in inflation-indexed securities.
NT Diversified Bond Fund seeks a high level of income by investing primarily in high- and medium-grade non-money market debt securities. These securities, which may be payable in U.S. or foreign currencies, may include corporate bonds and notes, government securities and securities backed by mortgages or other assets.
International Fixed Income Funds
International Bond Fund seeks high total return by investing in high-quality, non-dollar-denominated government and corporate debt securities outside the United States.
Money Market Funds
Premium Money Market Fund seeks to earn the highest level of current income while preserving the value of shareholder investments by investing in high-quality, cash-equivalent securities.
Security Valuations — Investments in the underlying funds are valued at their reported net asset value. The underlying funds have specific valuation policies. If an event occurs after the value of a security was established but before the net asset value per share of an underlying fund was determined that was likely to materially change the net asset value of the underlying fund, that security would be valued as determined in accordance with procedures adopted by the Board of Directors / Trustees. If the underlying fund determines that the market price of a portfolio security is not readily available, or that the valuation methods mentioned above do not reflect the security’s fair value, such security is valued as determined by the Board of Directors / Trustees or its designee, in accordance with procedures adopted by the Board o f Directors / Trustees, if such determination would materially impact an underlying fund’s net asset value. Certain other circumstances may cause the underlying fund to use alternative procedures to value a security such as: a security has been declared in default; trading in a security has been halted during the trading day; or there is a foreign market holiday and no trading will commence.
41
Security Transactions — For financial reporting purposes, security transactions are accounted for as of the trade date. Net realized gains and losses are determined on the identified cost basis, which is also used for federal income tax purposes.
Investment Income — Income and capital gain distributions, if any, from the underlying funds are recorded as of the ex-dividend date. Long-term capital gain distributions, if any, from the underlying funds are a component of net realized gain (loss).
Expenses — The expenses included in the accompanying financial statements reflect the expenses of each fund and do not include any expenses associated with the underlying funds
Income Tax Status — It is each fund’s policy to distribute substantially all net investment income and net realized gains to shareholders and to otherwise qualify as a regulated investment company under provisions of the Internal Revenue Code. All tax years for the funds remain subject to examination by tax authorities. At this time, management believes there are no uncertain tax positions which, based on their technical merit, would not be sustained upon examination and for which it is reasonably possible that the total amounts of unrecognized tax benefits will significantly change in the next twelve months. Accordingly, no provision has been made for federal or state income taxes. Interest and penalties associated with any federal or state income tax obligations, if any, are recorded as interest expense.
Distributions to Shareholders — Distributions to shareholders are recorded on the ex-dividend date. Distributions from net investment income, if any, are generally declared and paid quarterly for LIVESTRONG Income Portfolio. Distributions from net investment income, if any, are generally declared and paid annually for the eight target-date LIVESTRONG Portfolios. Distributions from net realized gains, if any, are generally declared and paid annually for all funds.
Indemnifications — Under the corporation’s organizational documents, its officers and directors are indemnified against certain liabilities arising out of the performance of their duties to the funds. In addition, in the normal course of business, the funds enter into contracts that provide general indemnifications. The maximum exposure under these arrangements is unknown as this would involve future claims that may be made against a fund. The risk of material loss from such claims is considered by management to be remote.
Use of Estimates — The financial statements are prepared in conformity with accounting principles generally accepted in the United States of America, which may require management to make certain estimates and assumptions at the date of the financial statements. Actual results could differ from these estimates.
Subsequent Events — Management has evaluated events or transactions that may have occurred since July 31, 2009, that would merit recognition or disclosure in the financial statements. This evaluation was completed through September 28, 2009, the date the financial statements were issued.
42
2. Fees and Transactions with Related Parties
Administrative Fees — The corporation has entered into a Management Agreement with American Century Investment Management, Inc. (ACIM), under which ACIM provides the funds with shareholder services in exchange for an administrative fee (the fee). The fee is computed and accrued daily based on the daily net assets of each specific class of shares of each fund and paid monthly in arrears. The rate of the fee for the Investor Class, Advisor Class and R Class of the funds is 0.20%. There is no administrative fee for the Institutional Class.
Distribution Fees — The Board of Directors has adopted a separate Master Distribution and Individual Shareholder Services Plan for each of the Advisor Class and R Class (collectively the plans), pursuant to Rule 12b-1 of the 1940 Act. The plans provide that the Advisor Class will pay American Century Investment Services, Inc. (ACIS) an annual distribution and service fee of 0.25%. The plans provide that the R Class will pay ACIS an annual distribution and service fee of 0.50%. The fees are computed and accrued daily based on each class’s daily net assets and paid monthly in arrears. These fees are used to pay financial intermediaries for distribution and individual shareholder services. Fees incurred under the plans during the year ended July 31, 2009, are detailed in the Statement of Operations.
Management Fees — Each fund will indirectly realize its pro rata share of the fees and expenses of the underlying funds in which it invests. These fees and expenses are already reflected in the valuation of the underlying funds.
Related Parties — Certain officers and directors of the corporation are also officers and/or directors, and, as a group, controlling stockholders of American Century Companies, Inc. (ACC), the parent of the corporation’s investment advisor, ACIM, the distributor of the corporation, ACIS, and the corporation’s transfer agent, American Century Services, LLC. The directors of the corporation are also directors of some underlying funds and therefore those underlying funds may be deemed to be under common control with the corporation. The officers of the corporation are also officers of all the underlying funds. ACIM or American Century Global Investment Management, Inc., a wholly-owned subsidiary of ACIM, serves as the investment advisor for the underlying funds.
The funds have a Mutual Funds Services Agreement with J.P. Morgan Investor Services Co. (JPMIS). JPMIS is a wholly owned subsidiary of JPMorgan Chase & Co. (JPM). JPM is an equity investor in ACC.
3. Investment Transactions
Investment transactions for the year ended July 31, 2009, were as follows:
LIVESTRONG | LIVESTRONG | LIVESTRONG | LIVESTRONG | LIVESTRONG | |
Income Portfolio | 2015 Portfolio | 2020 Portfolio | 2025 Portfolio | 2030 Portfolio | |
Purchases | $143,881,192 | $207,459,153 | $140,998,392 | $266,615,608 | $106,072,052 |
Sales | $50,700,956 | $69,082,964 | $29,575,961 | $71,458,606 | $18,654,584 |
LIVESTRONG | LIVESTRONG | LIVESTRONG | LIVESTRONG | ||
2035 Portfolio | 2040 Portfolio | 2045 Portfolio | 2050 Portfolio | ||
Purchases | $142,124,262 | $38,032,150 | $63,550,561 | $6,990,054 | |
Sales | $33,700,252 | $4,070,333 | $19,498,061 | $806,362 |
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4. Capital Share Transactions
The corporation is authorized to issue 3,000,000,000 shares. Transactions in shares of the funds were as follows:
Year ended July 31, 2009 | Year ended July 31, 2008 | |||
Shares | Amount | Shares | Amount | |
LIVESTRONG Income Portfolio | ||||
Investor Class | ||||
Sold | 18,698,026 | $ 167,113,157 | 1,523,508 | $ 16,847,911 |
Issued in reinvestment of distributions | 248,479 | 2,248,041 | 168,042 | 1,850,738 |
Redeemed | (13,569,378) | (119,654,444) | (1,040,699) | (11,448,990) |
5,377,127 | 49,706,754 | 650,851 | 7,249,659 | |
Institutional Class | ||||
Sold | 2,203,254 | 19,476,461 | 499,845 | 5,531,784 |
Issued in reinvestment of distributions | 50,835 | 459,998 | 34,216 | 376,777 |
Redeemed | (536,074) | (4,816,742) | (368,318) | (4,091,466) |
1,718,015 | 15,119,717 | 165,743 | 1,817,095 | |
Advisor Class | ||||
Sold | 3,611,889 | 32,498,100 | 635,076 | 7,022,165 |
Issued in reinvestment of distributions | 35,451 | 321,543 | 23,937 | 263,705 |
Redeemed | (835,727) | (7,366,830) | (615,687) | (6,916,439) |
2,811,613 | 25,452,813 | 43,326 | 369,431 | |
R Class | ||||
Sold | 406,615 | 3,736,252 | 36,733 | 404,679 |
Issued in reinvestment of distributions | 5,385 | 47,928 | 517 | 5,665 |
Redeemed | (80,992) | (717,293) | (14,376) | (159,950) |
331,008 | 3,066,887 | 22,874 | 250,394 | |
Net increase (decrease) | 10,237,763 | $ 93,346,171 | 882,794 | $ 9,686,579 |
LIVESTRONG 2015 Portfolio | ||||
Investor Class | ||||
Sold | 22,036,378 | $ 202,222,781 | 4,935,566 | $ 58,173,266 |
Issued in reinvestment of distributions | 786,589 | 7,063,567 | 471,644 | 5,574,831 |
Redeemed | (15,032,106) | (136,940,716) | (2,930,959) | (34,481,030) |
7,790,861 | 72,345,632 | 2,476,251 | 29,267,067 | |
Institutional Class | ||||
Sold | 5,289,808 | 48,352,553 | 653,459 | 7,690,482 |
Issued in reinvestment of distributions | 101,282 | 909,515 | 49,378 | 583,652 |
Redeemed | (937,904) | (8,499,045) | (457,705) | (5,457,023) |
4,453,186 | 40,763,023 | 245,132 | 2,817,111 | |
Advisor Class | ||||
Sold | 2,828,051 | 26,297,380 | 1,442,194 | 16,986,326 |
Issued in reinvestment of distributions | 130,939 | 1,175,836 | 46,319 | 547,493 |
Redeemed | (1,005,660) | (9,384,716) | (965,001) | (11,738,341) |
1,953,330 | 18,088,500 | 523,512 | 5,795,478 | |
R Class | ||||
Sold | 1,828,044 | 16,821,336 | 208,185 | 2,486,903 |
Issued in reinvestment of distributions | 26,161 | 234,927 | 11,492 | 135,950 |
Redeemed | (868,132) | (8,085,850) | (121,357) | (1,397,408) |
986,073 | 8,970,413 | 98,320 | 1,225,445 | |
Net increase (decrease) | 15,183,450 | $ 140,167,568 | 3,343,215 | $ 39,105,101 |
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Year ended July 31, 2009 | Year ended July 31, 2008(1) | |||
Shares | Amount | Shares | Amount | |
LIVESTRONG 2020 Portfolio | ||||
Investor Class | ||||
Sold | 27,157,029 | $ 210,655,998 | 114,155 | $1,093,368 |
Issued in reinvestment of distributions | 9,330 | 71,188 | — | — |
Redeemed | (16,496,812) | (126,304,813) | (1,133) | (10,810) |
10,669,547 | 84,422,373 | 113,022 | 1,082,558 | |
Institutional Class | ||||
Sold | 2,804,118 | 21,239,817 | 1,687 | 16,336 |
Issued in reinvestment of distributions | 1,490 | 11,369 | — | — |
Redeemed | (266,680) | (2,037,321) | — | — |
2,538,928 | 19,213,865 | 1,687 | 16,336 | |
Advisor Class | ||||
Sold | 485,585 | 3,886,194 | 625 | 6,250 |
Issued in reinvestment of distributions | 1,687 | 12,872 | — | — |
Redeemed | (28,684) | (226,837) | — | — |
458,588 | 3,672,229 | 625 | 6,250 | |
R Class | ||||
Sold | 441,491 | 3,608,622 | 625 | 6,250 |
Issued in reinvestment of distributions | 1,534 | 11,706 | — | — |
Redeemed | (55,883) | (421,579) | — | — |
387,142 | 3,198,749 | 625 | 6,250 | |
Net increase (decrease) | 14,054,205 | $ 110,507,216 | 115,959 | $1,111,394 |
LIVESTRONG 2025 Portfolio | ||||
Investor Class | ||||
Sold | 32,596,486 | $ 293,192,970 | 7,227,400 | $ 87,956,265 |
Issued in reinvestment of distributions | 1,046,971 | 9,161,018 | 554,236 | 6,811,558 |
Redeemed | (19,969,203) | (177,575,845) | (3,452,073) | (41,430,297) |
13,674,254 | 124,778,143 | 4,329,563 | 53,337,526 | |
Institutional Class | ||||
Sold | 5,025,377 | 44,620,828 | 1,003,427 | 12,207,554 |
Issued in reinvestment of distributions | 211,413 | 1,849,853 | 125,482 | 1,542,174 |
Redeemed | (1,078,207) | (9,830,657) | (874,062) | (10,878,957) |
4,158,583 | 36,640,024 | 254,847 | 2,870,771 | |
Advisor Class | ||||
Sold | 3,796,789 | 34,330,412 | 1,600,667 | 19,440,964 |
Issued in reinvestment of distributions | 144,407 | 1,263,560 | 42,508 | 522,421 |
Redeemed | (1,254,939) | (11,345,728) | (609,735) | (7,683,302) |
2,686,257 | 24,248,244 | 1,033,440 | 12,280,083 | |
R Class | ||||
Sold | 1,610,391 | 14,596,950 | 173,823 | 2,090,704 |
Issued in reinvestment of distributions | 23,819 | 208,417 | 4,062 | 49,926 |
Redeemed | (190,859) | (1,714,109) | (52,910) | (632,853) |
1,443,351 | 13,091,258 | 124,975 | 1,507,777 | |
Net increase (decrease) | 21,962,445 | $ 198,757,669 | 5,742,825 | $ 69,996,157 |
(1) May 30, 2008 (fund inception) through July 31, 2008 for LIVESTRONG 2020 Portfolio. |
45
Year ended July 31, 2009 | Year ended July 31, 2008(1) | |||
Shares | Amount | Shares | Amount | |
LIVESTRONG 2030 Portfolio | ||||
Investor Class | ||||
Sold | 21,407,615 | $156,161,055 | 69,257 | $655,977 |
Issued in reinvestment of distributions | 5,047 | 36,137 | — | — |
Redeemed | (12,730,080) | (91,576,604) | (2,578) | (24,039) |
8,682,582 | 64,620,588 | 66,679 | 631,938 | |
Institutional Class | ||||
Sold | 2,368,824 | 16,803,262 | 625 | 6,250 |
Issued in reinvestment of distributions | 1,145 | 8,184 | — | — |
Redeemed | (192,452) | (1,365,186) | — | — |
2,177,517 | 15,446,260 | 625 | 6,250 | |
Advisor Class | ||||
Sold | 467,504 | 3,491,863 | 625 | 6,250 |
Issued in reinvestment of distributions | 756 | 5,403 | — | — |
Redeemed | (48,087) | (351,751) | — | — |
420,173 | 3,145,515 | 625 | 6,250 | |
R Class | ||||
Sold | 511,522 | 4,063,426 | 625 | 6,250 |
Issued in reinvestment of distributions | 2,140 | 15,299 | — | — |
Redeemed | (68,616) | (495,266) | — | — |
445,046 | 3,583,459 | 625 | 6,250 | |
Net increase (decrease) | 11,725,318 | $ 86,795,822 | 68,554 | $650,688 |
LIVESTRONG 2035 Portfolio | ||||
Investor Class | ||||
Sold | 15,299,408 | $136,512,600 | 5,273,716 | $ 67,011,195 |
Issued in reinvestment of distributions | 568,003 | 4,896,188 | 265,648 | 3,469,367 |
Redeemed | (9,015,703) | (79,453,689) | (1,862,588) | (23,625,688) |
6,851,708 | 61,955,099 | 3,676,776 | 46,854,874 | |
Institutional Class | ||||
Sold | 3,274,007 | 28,605,892 | 542,257 | 6,886,635 |
Issued in reinvestment of distributions | 111,052 | 958,378 | 61,402 | 801,912 |
Redeemed | (604,926) | (5,288,948) | (315,217) | (4,091,617) |
2,780,133 | 24,275,322 | 288,442 | 3,596,930 | |
Advisor Class | ||||
Sold | 2,405,740 | 21,576,278 | 1,057,731 | 13,387,446 |
Issued in reinvestment of distributions | 91,719 | 791,531 | 30,822 | 402,842 |
Redeemed | (700,595) | (6,258,117) | (527,772) | (7,020,874) |
1,796,864 | 16,109,692 | 560,781 | 6,769,414 | |
R Class | ||||
Sold | 1,031,714 | 9,297,204 | 160,015 | 2,063,991 |
Issued in reinvestment of distributions | 15,842 | 136,697 | 3,922 | 51,263 |
Redeemed | (118,195) | (1,044,968) | (58,210) | (723,518) |
929,361 | 8,388,933 | 105,727 | 1,391,736 | |
Net increase (decrease) | 12,358,066 | $ 110,729,046 | 4,631,726 | $ 58,612,954 |
(1) May 30, 2008 (fund inception) through July 31, 2008 for LIVESTRONG 2030 Portfolio. |
46
Year ended July 31, 2009 | Year ended July 31, 2008(1) | |||
Shares | Amount | Shares | Amount | |
LIVESTRONG 2040 Portfolio | ||||
Investor Class | ||||
Sold | 6,667,507 | $ 46,398,192 | 90,295 | $837,273 |
Issued in reinvestment of distributions | 2,393 | 16,296 | — | — |
Redeemed | (3,611,169) | (24,864,481) | (821) | (8,000) |
3,058,731 | 21,550,007 | 89,474 | 829,273 | |
Institutional Class | ||||
Sold | 1,366,315 | 9,109,351 | 625 | 6,250 |
Issued in reinvestment of distributions | 173 | 1,179 | — | — |
Redeemed | (96,817) | (658,594) | — | — |
1,269,671 | 8,451,936 | 625 | 6,250 | |
Advisor Class | ||||
Sold | 221,418 | 1,546,579 | 625 | 6,250 |
Issued in reinvestment of distributions | 424 | 2,891 | — | — |
Redeemed | (21,884) | (151,240) | — | — |
199,958 | 1,398,230 | 625 | 6,250 | |
R Class | ||||
Sold | 360,415 | 2,744,768 | 625 | 6,250 |
Issued in reinvestment of distributions | 1,568 | 10,677 | — | — |
Redeemed | (58,519) | (400,310) | — | — |
303,464 | 2,355,135 | 625 | 6,250 | |
Net increase (decrease) | 4,831,824 | $ 33,755,308 | 91,349 | $848,023 |
LIVESTRONG 2045 Portfolio | ||||
Investor Class | ||||
Sold | 5,655,690 | $49,850,208 | 3,499,543 | $ 45,795,739 |
Issued in reinvestment of distributions | 328,649 | 2,767,177 | 145,128 | 1,938,913 |
Redeemed | (3,046,344) | (26,737,712) | (1,307,691) | (16,851,978) |
2,937,995 | 25,879,673 | 2,336,980 | 30,882,674 | |
Institutional Class | ||||
Sold | 1,773,404 | 15,431,701 | 896,299 | 11,781,809 |
Issued in reinvestment of distributions | 123,451 | 1,039,462 | 76,344 | 1,020,715 |
Redeemed | (823,627) | (7,441,026) | (561,204) | (7,352,345) |
1,073,228 | 9,030,137 | 411,439 | 5,450,179 | |
Advisor Class | ||||
Sold | 1,094,726 | 9,314,758 | 593,456 | 7,704,375 |
Issued in reinvestment of distributions | 50,634 | 426,339 | 23,025 | 307,616 |
Redeemed | (247,353) | (2,181,953) | (362,137) | (4,775,098) |
898,007 | 7,559,144 | 254,344 | 3,236,893 | |
R Class | ||||
Sold | 502,089 | 4,299,317 | 86,662 | 1,132,673 |
Issued in reinvestment of distributions | 6,079 | 51,182 | 1,521 | 20,338 |
Redeemed | (103,842) | (885,817) | (29,548) | (383,790) |
404,326 | 3,464,682 | 58,635 | 769,221 | |
Net increase (decrease) | 5,313,556 | $45,933,636 | 3,061,398 | $ 40,338,967 |
(1) May 30, 2008 (fund inception) through July 31, 2008 for LIVESTRONG 2040 Portfolio. |
47
Year ended July 31, 2009 | Year ended July 31, 2008(1) | |||
Shares | Amount | Shares | Amount | |
LIVESTRONG 2050 Portfolio | ||||
Investor Class | ||||
Sold | 655,827 | $ 4,433,260 | 51,078 | $488,874 |
Issued in reinvestment of distributions | 1,292 | 8,453 | — | — |
Redeemed | (244,500) | (1,606,061) | (764) | (7,000) |
412,619 | 2,835,652 | 50,314 | 481,874 | |
Institutional Class | ||||
Sold | 493,540 | 3,313,874 | 625 | 6,250 |
Issued in reinvestment of distributions | 1,583 | 10,356 | — | — |
Redeemed | (70,213) | (482,585) | — | — |
424,910 | 2,841,645 | 625 | 6,250 | |
Advisor Class | ||||
Sold | 45,591 | 310,177 | 625 | 6,250 |
Issued in reinvestment of distributions | 27 | 179 | — | — |
Redeemed | (1,107) | (7,497) | — | — |
44,511 | 302,859 | 625 | 6,250 | |
R Class | ||||
Sold | 29,516 | 203,431 | 625 | 6,250 |
Issued in reinvestment of distributions | 77 | 502 | — | — |
Redeemed | (5,180) | (34,373) | — | — |
24,413 | 169,560 | 625 | 6,250 | |
Net increase (decrease) | 906,453 | $ 6,149,716 | 52,189 | $500,624 |
(1) May 30, 2008 (fund inception) through July 31, 2008 for LIVESTRONG 2050 Portfolio. |
48
5. Affiliated Company Transactions
Investments are funds within the American Century Investments family of funds, of which certain funds may be deemed to be under common control because of the same board of directors. A summary of the transactions for each underlying fund during the year ended July 31, 2009 follows:
July 31, 2008 | July 31, 2009 | ||||||
Share | Purchase | Sales | Realized | Distributions | Share | Market | |
Fund/Underlying Fund | Balance | Cost | Cost | Gain (Loss) | Received(1) | Balance | Value |
LIVESTRONG Income Portfolio | |||||||
NT Equity Growth Fund | |||||||
Institutional Class | 856,240 | $ 19,650,436 | $ 8,359,307 | $ (2,865,433) | $ 234,916 | 2,787,244 | $ 21,183,054 |
NT Growth Fund | |||||||
Institutional Class | 388,477 | 9,324,621 | 3,966,496 | (1,084,547) | 31,517 | 1,191,828 | 10,619,188 |
NT Large Company | |||||||
Value Fund | |||||||
Institutional Class | 769,386 | 17,350,563 | 8,890,779 | (3,533,055) | 274,010 | 2,563,045 | 17,633,750 |
NT Mid Cap Value Fund | |||||||
Institutional Class | 292,448 | 5,783,009 | 2,737,640 | (852,321) | 76,251 | 826,168 | 6,526,727 |
NT Small Company | |||||||
Fund Institutional Class | 153,329 | 3,134,615 | 1,572,760 | (682,869) | 4,015 | 545,562 | 3,300,650 |
NT Vista Fund | |||||||
Institutional Class(2) | 142,931 | 3,750,890 | 1,453,118 | (479,096) | — | 531,826 | 3,988,695 |
Real Estate Fund | |||||||
Institutional Class | 30,326 | 1,802,550 | 1,183,339 | (560,780) | 36,782 | 138,750 | 1,526,250 |
High-Yield Fund | |||||||
Institutional Class | 439,813 | 5,145,070 | 2,451,249 | (573,486) | 313,670 | 1,118,004 | 6,093,122 |
Inflation-Adjusted Bond | |||||||
Fund Institutional Class | 467,270 | 10,493,344 | 4,446,971 | (104,506) | 126,275 | 1,050,025 | 11,697,278 |
NT Diversified Bond | |||||||
Fund Institutional Class | 1,817,937 | 36,319,180 | 15,170,518 | (112,759) | 1,478,434 | 3,920,806 | 40,658,758 |
Premium Money Market | |||||||
Fund Investor Class | 7,041,280 | 13,774,795 | 5,796,259 | — | 123,661 | 15,019,816 | 15,019,816 |
International Bond Fund | |||||||
Institutional Class | 326,382 | 9,389,220 | 3,336,386 | (189,171) | 248,633 | 761,308 | 11,282,585 |
NT International Growth | |||||||
Fund Institutional Class | 297,235 | 7,962,899 | 3,730,930 | (1,356,773) | 50,257 | 1,102,468 | 8,676,423 |
$143,881,192 | $63,095,752 | $(12,394,796) | $2,998,421 | $158,206,296 |
(1) | Distributions received includes distributions from net investment income and from capital gains from the underlying funds. |
(2) | Non-income producing. |
49
July 31, 2008 | July 31, 2009 | ||||||
Share | Purchase | Sales | Realized | Distributions | Share | Market | |
Fund/Underlying Fund | Balance | Cost | Cost | Gain (Loss) | Received(1) | Balance | Value |
LIVESTRONG 2015 Portfolio | |||||||
NT Equity Growth Fund | |||||||
Institutional Class | 2,552,134 | $ 26,771,469 | $ 7,815,846 | $ (2,610,174) | $ 601,943 | 5,557,150 | $ 42,234,340 |
NT Growth Fund | |||||||
Institutional Class | 1,481,964 | 16,305,599 | 5,508,934 | (1,534,434) | 120,233 | 3,048,884 | 27,165,556 |
NT Large Company | |||||||
Value Fund | |||||||
Institutional Class | 2,441,771 | 25,749,689 | 10,122,487 | (3,796,762) | 735,053 | 5,426,807 | 37,336,432 |
NT Mid Cap Value Fund | |||||||
Institutional Class | 1,133,888 | 9,945,412 | 3,977,578 | (1,139,457) | 255,106 | 2,141,941 | 16,921,334 |
NT Small Company | |||||||
Fund Institutional Class | 475,348 | 4,645,491 | 1,724,769 | (717,179) | 12,438 | 1,128,158 | 6,825,356 |
NT Vista Fund | |||||||
Institutional Class(2) | 708,665 | 8,426,649 | 2,525,984 | (923,823) | — | 1,643,618 | 12,327,135 |
Real Estate Fund | |||||||
Institutional Class | 127,130 | 3,687,693 | 2,901,808 | (1,709,210) | 132,487 | 367,873 | 4,046,603 |
High-Yield Fund | |||||||
Institutional Class | 1,291,014 | 6,767,168 | 2,990,165 | (625,891) | 734,134 | 2,206,883 | 12,027,512 |
Inflation-Adjusted Bond | |||||||
Fund Institutional Class | 1,370,511 | 13,918,266 | 6,616,297 | (274,912) | 368,729 | 2,088,019 | 23,260,532 |
NT Diversified Bond | |||||||
Fund Institutional Class | 5,290,466 | 48,281,769 | 23,708,959 | (376,018) | 3,748,519 | 7,755,907 | 80,428,756 |
NT Emerging Markets | |||||||
Fund Institutional Class | 306,469 | 3,841,875 | 3,421,492 | (1,620,983) | 15,157 | 599,683 | 4,629,553 |
NT International Growth | |||||||
Fund Institutional Class | 1,152,707 | 14,586,283 | 5,437,513 | (1,995,946) | 184,561 | 2,761,408 | 21,732,281 |
Premium Money Market | |||||||
Fund Investor Class | 14,169,337 | 13,689,016 | 5,991,719 | — | 225,045 | 21,866,634 | 21,866,634 |
International Bond Fund | |||||||
Institutional Class | 808,465 | 10,842,774 | 3,940,872 | (276,670) | 623,143 | 1,320,292 | 19,566,727 |
$207,459,153 | $86,684,423 | $(17,601,459) | $7,756,548 | $330,368,751 |
(1) | Distributions received includes distributions from net investment income and from capital gains from the underlying funds. |
(2) | Non-income producing. |
50
July 31, 2008 | July 31, 2009 | ||||||
Share | Purchase | Sales | Realized | Distributions | Share | Market | |
Fund/Underlying Fund | Balance | Cost | Cost | Gain (Loss) | Received(1) | Balance | Value |
LIVESTRONG 2020 Portfolio | |||||||
NT Equity Growth Fund | |||||||
Institutional Class | 13,523 | $ 17,332,225 | $ 3,538,914 | $ (483,997) | $ 110,771 | 1,970,129 | $ 14,972,980 |
NT Growth Fund | |||||||
Institutional Class | 9,493 | 12,484,911 | 2,794,957 | (241,063) | 5,507 | 1,274,756 | 11,358,076 |
NT Large Company | |||||||
Value Fund | |||||||
Institutional Class | 13,966 | 16,662,200 | 4,001,042 | (552,189) | 157,575 | 2,008,361 | 13,817,524 |
NT Mid Cap Value Fund | |||||||
Institutional Class | 6,894 | 7,720,185 | 1,776,079 | (175,928) | 52,818 | 852,435 | 6,734,236 |
NT Small Company | |||||||
Fund Institutional Class | 3,331 | 3,580,345 | 815,604 | (121,027) | 481 | 510,117 | 3,086,208 |
NT Vista Fund | |||||||
Institutional Class(2) | 4,392 | 6,052,426 | 1,186,456 | (136,486) | — | 714,014 | 5,355,105 |
Real Estate Fund | |||||||
Institutional Class | 835 | 2,385,213 | 803,444 | (151,952) | 25,974 | 159,305 | 1,752,355 |
High-Yield Fund | |||||||
Institutional Class | 6,418 | 4,630,009 | 1,102,022 | (28,722) | 162,479 | 754,254 | 4,110,684 |
Inflation-Adjusted Bond | |||||||
Fund Institutional Class | 6,564 | 9,651,789 | 2,276,319 | (4,095) | 4,948 | 708,859 | 7,896,689 |
NT Diversified Bond | |||||||
Fund Institutional Class | 25,513 | 34,063,622 | 7,449,275 | (9,899) | 555,504 | 2,664,978 | 27,635,822 |
NT Emerging Markets | |||||||
Fund Institutional Class | 2,495 | 3,170,608 | 1,018,265 | (53,279) | 9,425 | 389,234 | 3,004,887 |
NT International Growth | |||||||
Fund Institutional Class | 7,356 | 9,824,441 | 2,369,777 | (260,766) | 8,117 | 1,162,977 | 9,152,629 |
Premium Money Market | |||||||
Fund Investor Class | 55,710 | 7,151,936 | 1,548,081 | — | 22,915 | 5,659,565 | 5,659,565 |
International Bond Fund | |||||||
Institutional Class | 2,934 | 6,288,482 | 1,177,581 | (62,452) | 12,214 | 370,258 | 5,487,224 |
$140,998,392 | $31,857,816 | $(2,281,855) | $1,128,728 | $120,023,984 |
(1) | Distributions received includes distributions from net investment income and from capital gains from the underlying funds. |
(2) | Non-income producing. |
51
July 31, 2008 | July 31, 2009 | ||||||
Share | Purchase | Sales | Realized | Distributions | Share | Market | |
Fund/Underlying Fund | Balance | Cost | Cost | Gain (Loss) | Received(1) | Balance | Value |
LIVESTRONG 2025 Portfolio | |||||||
NT Equity Growth Fund | |||||||
Institutional Class | 3,602,431 | $ 32,424,880 | $ 5,370,155 | $ (1,864,036) | $ 818,821 | 7,648,927 | $ 58,131,845 |
NT Growth Fund | |||||||
Institutional Class | 2,941,097 | 26,651,121 | 6,086,013 | (1,840,521) | 224,110 | 5,769,287 | 51,404,347 |
NT Large Company | |||||||
Value Fund | |||||||
Institutional Class | 3,752,460 | 33,519,653 | 9,639,318 | (3,577,361) | 1,066,454 | 7,968,242 | 54,821,505 |
NT Mid Cap Value Fund | |||||||
Institutional Class | 1,680,943 | 12,669,834 | 3,776,390 | (1,074,713) | 363,761 | 3,096,495 | 24,462,311 |
NT Small Company | |||||||
Fund Institutional Class | 1,174,267 | 9,958,872 | 2,345,634 | (944,937) | 29,956 | 2,718,383 | 16,446,217 |
NT Vista Fund | |||||||
Institutional Class(2) | 1,249,163 | 13,835,710 | 1,860,455 | (757,694) | — | 3,018,698 | 22,640,235 |
Real Estate Fund | |||||||
Institutional Class | 245,954 | 6,352,075 | 4,221,789 | (2,538,770) | 249,310 | 703,700 | 7,740,700 |
High-Yield Fund | |||||||
Institutional Class | 1,544,407 | 7,269,096 | 3,187,478 | (670,237) | 832,385 | 2,529,543 | 13,786,009 |
Inflation-Adjusted Bond | |||||||
Fund Institutional Class | 1,639,867 | 15,721,657 | 7,457,491 | (368,020) | 440,301 | 2,456,206 | 27,362,135 |
NT Diversified Bond | |||||||
Fund Institutional Class | 6,276,546 | 54,443,753 | 26,681,248 | (500,212) | 4,308,893 | 9,068,819 | 94,043,653 |
NT Emerging Markets | |||||||
Fund Institutional Class | 740,611 | 9,445,329 | 4,773,434 | (2,097,812) | 43,737 | 1,813,244 | 13,998,244 |
NT International Growth | |||||||
Fund Institutional Class | 2,276,565 | 25,589,814 | 6,586,959 | (2,485,836) | 355,271 | 5,378,530 | 42,329,031 |
Premium Money Market | |||||||
Fund Investor Class | 15,395,670 | 12,874,416 | 6,776,260 | — | 228,403 | 21,493,826 | 21,493,826 |
International Bond Fund | |||||||
Institutional Class | 305,876 | 5,859,398 | 1,559,720 | (143,589) | 262,363 | 625,811 | 9,274,519 |
$266,615,608 | $90,322,344 | $(18,863,738) | $9,223,765 | $457,934,577 |
(1) | Distributions received includes distributions from net investment income and from capital gains from the underlying funds. |
(2) | Non-income producing. |
52
July 31, 2008 | July 31, 2009 | ||||||
Share | Purchase | Sales | Realized | Distributions | Share | Market | |
Fund/Underlying Fund | Balance | Cost | Cost | Gain (Loss) | Received(1) | Balance | Value |
LIVESTRONG 2030 Portfolio | |||||||
NT Equity Growth Fund | |||||||
Institutional Class | 8,437 | $ 13,438,503 | $ 2,091,663 | $ (323,441) | $ 88,585 | 1,610,477 | $12,239,625 |
NT Growth Fund | |||||||
Institutional Class | 7,661 | 12,861,679 | 2,334,074 | (243,316) | 5,766 | 1,380,021 | 12,295,987 |
NT Large Company | |||||||
Value Fund | |||||||
Institutional Class | 9,291 | 13,763,240 | 2,657,147 | (395,208) | 134,591 | 1,748,426 | 12,029,171 |
NT Mid Cap Value Fund | |||||||
Institutional Class | 4,234 | 5,758,842 | 1,063,295 | (120,104) | 40,682 | 669,431 | 5,288,505 |
NT Small Company | |||||||
Fund Institutional Class | 3,119 | 4,522,087 | 804,446 | (130,809) | 593 | 681,259 | 4,121,617 |
NT Vista Fund | |||||||
Institutional Class(2) | 3,204 | 5,591,114 | 906,135 | (125,154) | — | 685,954 | 5,144,655 |
Real Estate Fund | |||||||
Institutional Class | 642 | 2,349,076 | 687,080 | (136,084) | 26,686 | 165,791 | 1,823,701 |
High-Yield Fund | |||||||
Institutional Class | 2,819 | 2,770,157 | 603,104 | (20,566) | 98,231 | 461,025 | 2,512,586 |
Inflation-Adjusted Bond | |||||||
Fund Institutional Class | 2,949 | 5,891,046 | 1,281,939 | (7,439) | 2,116 | 441,440 | 4,917,642 |
NT Diversified Bond | |||||||
Fund Institutional Class | 11,435 | 20,611,444 | 4,126,768 | (16,688) | 340,997 | 1,645,852 | 17,067,485 |
NT Emerging Markets | |||||||
Fund Institutional Class | 2,059 | 3,651,851 | 1,003,731 | (46,505) | 11,265 | 475,805 | 3,673,215 |
NT International Growth | |||||||
Fund Institutional Class | 5,964 | 9,921,605 | 1,928,317 | (241,142) | 8,627 | 1,239,635 | 9,755,927 |
Premium Money Market | |||||||
Fund Investor Class | 26,107 | 4,941,408 | 973,341 | — | 15,743 | 3,994,174 | 3,994,174 |
$106,072,052 | $20,461,040 | $(1,806,456) | $773,882 | $94,864,290 |
(1) | Distributions received includes distributions from net investment income and from capital gains from the underlying funds. |
(2) | Non-income producing. |
53
July 31, 2008 | July 31, 2009 | ||||||
Share | Purchase | Sales | Realized | Distributions | Share | Market | |
Fund/Underlying Fund | Balance | Cost | Cost | Gain (Loss) | Received(1) | Balance | Value |
LIVESTRONG 2035 Portfolio | |||||||
NT Equity Growth Fund | |||||||
Institutional Class | 2,449,303 | $ 18,499,896 | $ 3,353,775 | $ (1,243,061) | $ 519,851 | 4,750,635 | $ 36,104,826 |
NT Growth Fund | |||||||
Institutional Class | 2,222,291 | 16,842,640 | 3,263,392 | (1,119,410) | 163,345 | 4,071,949 | 36,281,066 |
NT Large Company | |||||||
Value Fund | |||||||
Institutional Class | 2,606,109 | 19,824,094 | 5,616,699 | (2,309,519) | 697,490 | 5,155,073 | 35,466,902 |
NT Mid Cap Value Fund | |||||||
Institutional Class | 1,312,467 | 8,087,687 | 2,899,128 | (842,625) | 260,100 | 2,164,783 | 17,101,786 |
NT Small Company | |||||||
Fund Institutional Class | 814,541 | 6,116,271 | 913,321 | (328,374) | 20,703 | 1,819,959 | 11,010,752 |
NT Vista Fund | |||||||
Institutional Class(2) | 1,024,146 | 9,502,580 | 1,511,412 | (671,807) | — | 2,216,542 | 16,624,065 |
Real Estate Fund | |||||||
Institutional Class | 189,899 | 4,241,055 | 2,462,181 | (1,501,275) | 183,009 | 508,499 | 5,593,489 |
High-Yield Fund | |||||||
Institutional Class | 675,627 | 3,302,240 | 1,607,228 | (330,159) | 355,305 | 1,094,665 | 5,965,924 |
Inflation-Adjusted Bond | |||||||
Fund Institutional Class | 716,608 | 6,783,841 | 3,683,773 | (221,269) | 191,217 | 1,029,010 | 11,463,171 |
NT Diversified Bond | |||||||
Fund Institutional Class | 2,815,854 | 22,676,071 | 12,505,582 | (351,215) | 1,852,196 | 3,846,878 | 39,892,125 |
NT Emerging Markets | |||||||
Fund Institutional Class | 676,185 | 7,576,161 | 3,233,202 | (1,352,584) | 36,930 | 1,582,020 | 12,213,194 |
NT International Growth | |||||||
Fund Institutional Class | 1,580,696 | 15,299,199 | 2,629,997 | (1,023,827) | 244,542 | 3,572,561 | 28,116,055 |
Premium Money Market | |||||||
Fund Investor Class | 2,798,043 | 3,372,527 | 1,315,687 | — | 45,087 | 4,854,883 | 4,854,883 |
$142,124,262 | $44,995,377 | $(11,295,125) | $4,569,775 | $260,688,238 |
(1) | Distributions received includes distributions from net investment income and from capital gains from the underlying funds. |
(2) | Non-income producing. |
54
July 31, 2008 | July 31, 2009 | ||||||
Share | Purchase | Sales | Realized | Distributions | Share | Market | |
Fund/Underlying Fund | Balance | Cost | Cost | Gain (Loss) | Received(1) | Balance | Value |
LIVESTRONG 2040 Portfolio | |||||||
NT Equity Growth Fund | |||||||
Institutional Class | 12,654 | $ 5,620,923 | $ 496,720 | $(122,792) | $ 39,863 | 747,682 | $ 5,682,383 |
NT Growth Fund | |||||||
Institutional Class | 11,476 | 5,283,399 | 618,715 | (119,430) | 3,266 | 625,447 | 5,572,733 |
NT Large Company | |||||||
Value Fund | |||||||
Institutional Class | 14,033 | 5,563,513 | 673,333 | (139,860) | 58,967 | 792,721 | 5,453,920 |
NT Mid Cap Value Fund | |||||||
Institutional Class | 7,065 | 2,699,901 | 294,373 | (47,593) | 20,844 | 351,915 | 2,780,129 |
NT Small Company | |||||||
Fund Institutional Class | 4,216 | 1,516,968 | 162,589 | (44,103) | 292 | 255,667 | 1,546,785 |
NT Vista Fund | |||||||
Institutional Class(2) | 5,346 | 2,707,028 | 298,412 | (71,728) | — | 360,843 | 2,706,323 |
Real Estate Fund | |||||||
Institutional Class | 1,073 | 1,036,711 | 236,584 | (56,113) | 13,278 | 82,564 | 908,204 |
High-Yield Fund | |||||||
Institutional Class | 2,749 | 749,633 | 119,369 | (8,558) | 26,987 | 135,139 | 736,507 |
Inflation-Adjusted Bond | |||||||
Fund Institutional Class | 2,805 | 1,564,390 | 252,331 | (6,000) | 1,072 | 127,038 | 1,415,203 |
NT Diversified Bond | |||||||
Fund Institutional Class | 11,113 | 5,514,858 | 806,083 | (9,222) | 95,473 | 477,499 | 4,951,665 |
NT Emerging Markets | |||||||
Fund Institutional Class | 4,109 | 1,955,529 | 408,032 | (36,357) | 6,070 | 283,654 | 2,189,809 |
NT International Growth | |||||||
Fund Institutional Class | 7,910 | 3,819,297 | 461,921 | (96,373) | 4,662 | 531,961 | 4,186,533 |
$38,032,150 | $4,828,462 | $(758,129) | $270,774 | $38,130,194 |
(1) | Distributions received includes distributions from net investment income and from capital gains from the underlying funds. |
(2) | Non-income producing. |
55
July 31, 2008 | July 31, 2009 | ||||||
Share | Purchase | Sales | Realized | Distributions | Share | Market | |
Fund/Underlying Fund | Balance | Cost | Cost | Gain (Loss) | Received(1) | Balance | Value |
LIVESTRONG 2045 Portfolio | |||||||
NT Equity Growth Fund | |||||||
Institutional Class | 1,767,703 | $ 8,765,750 | $ 2,762,011 | $ (954,244) | $ 333,233 | 2,764,185 | $ 21,007,806 |
NT Growth Fund | |||||||
Institutional Class | 1,603,749 | 7,672,383 | 2,409,982 | (834,393) | 109,334 | 2,369,786 | 21,114,793 |
NT Large Company | |||||||
Value Fund | |||||||
Institutional Class | 1,911,044 | 9,367,449 | 3,598,432 | (1,487,353) | 447,747 | 3,049,782 | 20,982,500 |
NT Mid Cap Value Fund | |||||||
Institutional Class | 949,245 | 3,651,477 | 1,654,752 | (430,339) | 171,227 | 1,309,619 | 10,345,990 |
NT Small Company | |||||||
Fund Institutional Class | 651,548 | 2,973,200 | 618,411 | (188,364) | 15,357 | 1,129,878 | 6,835,762 |
NT Vista Fund | |||||||
Institutional Class(2) | 740,940 | 4,906,129 | 898,834 | (380,008) | — | 1,341,136 | 10,058,520 |
Real Estate Fund | |||||||
Institutional Class | 155,018 | 2,353,943 | 1,802,672 | (1,028,886) | 134,187 | 335,863 | 3,694,493 |
NT Emerging Markets | |||||||
Fund Institutional Class | 631,758 | 5,710,374 | 2,878,306 | (1,253,374) | 29,161 | 1,262,828 | 9,749,032 |
NT International Growth | |||||||
Fund Institutional Class | 1,037,672 | 7,124,322 | 1,424,951 | (559,301) | 152,339 | 1,938,885 | 15,259,025 |
High-Yield Fund | |||||||
Institutional Class | 341,459 | 1,064,060 | 734,718 | (144,196) | 153,700 | 438,751 | 2,391,193 |
Inflation-Adjusted Bond | |||||||
Fund Institutional Class | 362,388 | 2,276,463 | 1,832,791 | (104,265) | 95,636 | 412,461 | 4,594,816 |
NT Diversified Bond | |||||||
Fund Institutional Class | 1,428,483 | 7,685,011 | 6,437,311 | (190,387) | 832,699 | 1,562,796 | 16,206,195 |
$63,550,561 | $27,053,171 | $(7,555,110) | $2,474,620 | $142,240,125 |
(1) | Distributions received includes distributions from net investment income and from capital gains from the underlying funds. |
(2) | Non-income producing. |
56
July 31, 2008 | July 31, 2009 | ||||||
Share | Purchase | Sales | Realized | Distributions | Share | Market | |
Fund/Underlying Fund | Balance | Cost | Cost | Gain (Loss) | Received(1) | Balance | Value |
LIVESTRONG 2050 Portfolio | |||||||
NT Equity Growth Fund | |||||||
Institutional Class | 7,438 | $1,062,863 | $ 133,081 | $ (42,064) | $ 8,370 | 143,676 | $1,091,938 |
NT Growth Fund | |||||||
Institutional Class | 6,726 | 1,028,728 | 140,750 | (41,115) | 2,185 | 123,025 | 1,096,153 |
NT Large Company | |||||||
Value Fund | |||||||
Institutional Class | 8,267 | 1,081,670 | 162,979 | (49,986) | 12,578 | 158,713 | 1,091,945 |
NT Mid Cap Value Fund | |||||||
Institutional Class | 4,102 | 508,480 | 69,352 | (17,081) | 4,568 | 68,107 | 538,045 |
NT Small Company | |||||||
Fund Institutional Class | 2,807 | 348,559 | 47,570 | (17,734) | 229 | 59,816 | 361,887 |
NT Vista Fund | |||||||
Institutional Class(2) | 3,119 | 526,215 | 75,990 | (28,590) | — | 70,010 | 525,075 |
Real Estate Fund | |||||||
Institutional Class | 681 | 223,851 | 63,969 | (25,352) | 3,761 | 18,270 | 200,970 |
NT Emerging Markets | |||||||
Fund Institutional Class | 2,839 | 454,118 | 115,905 | (32,087) | 1,089 | 65,640 | 506,741 |
NT International Growth | |||||||
Fund Institutional Class | 4,230 | 655,396 | 98,976 | (33,972) | 2,725 | 92,205 | 725,653 |
High-Yield Fund | |||||||
Institutional Class | 1,255 | 106,903 | 19,768 | (3,111) | 3,945 | 19,414 | 105,806 |
Inflation-Adjusted Bond | |||||||
Fund Institutional Class | 1,312 | 220,449 | 39,824 | (2,135) | 518 | 18,277 | 203,606 |
NT Diversified Bond | |||||||
Fund Institutional Class | 5,134 | 772,822 | 134,391 | (2,966) | 17,518 | 68,273 | 707,991 |
$6,990,054 | $1,102,555 | $(296,193) | $57,486 | $ 7,155,810 |
(1) | Distributions received includes distributions from net investment income and from capital gains from the underlying funds. |
(2) | Non-income producing. |
57
6. Investments in Underlying Funds
The funds do not invest in the underlying funds for the purpose of exercising management or control; however, investments by the funds within their investment strategies may represent a significant portion of the underlying funds’ net assets. As of July 31, 2009, the following LIVESTRONG Portfolios owned 25% or more of the total outstanding shares of the underlying funds:
LIVESTRONG | LIVESTRONG | |
2015 Portfolio | 2025 Portfolio | |
NT Diversified Bond Fund | 25% | 29% |
NT Emerging Markets Fund | — | 28% |
NT Equity Growth Fund | — | 27% |
NT Growth Fund | — | 29% |
NT International Growth Fund | — | 30% |
NT Large Company Value Fund | — | 28% |
NT Mid Cap Value Fund | — | 27% |
NT Small Company Fund | — | 31% |
NT Vista Fund | — | 29% |
As of July 31, 2009, the funds, in aggregate, owned 100% of the total outstanding shares of the underlying NT Diversified Bond Fund, NT Emerging Markets Fund, NT Equity Growth Fund, NT Growth Fund, NT International Growth Fund, NT Large Company Value Fund, NT Mid Cap Value Fund, NT Small Company Fund and NT Vista Fund.
7. Fair Value Measurements
The funds’ securities valuation process is based on several considerations and may use multiple inputs to determine the fair value of the positions held by the funds. In conformity with accounting principles generally accepted in the United States of America, the inputs used to determine a valuation are classified into three broad levels as follows:
• Level 1 valuation inputs consist of actual quoted prices in an active market for identical securities;
• Level 2 valuation inputs consist of significant direct or indirect observable market data (including quoted prices for similar securities, evaluations of subsequent market events, interest rates, prepayment speeds, credit risk, etc.); or
• Level 3 valuation inputs consist of significant unobservable inputs (including a fund’s own assumptions).
The level classification is based on the lowest level input that is significant to the fair valuation measurement. The valuation inputs are not an indication of the risks associated with investing in these securities or other financial instruments.
As of July 31, 2009, the valuation inputs used to determine the fair value of the funds’ securities were classified as Level 1.
58
8. Risk Factors
Some of the underlying funds invest in foreign securities, which are generally riskier than U.S. securities. As a result, the funds are subject to foreign risk, meaning that political events (such as civil unrest, national elections and imposition of exchange controls), social, and economic events (such as labor strikes and rising inflation), and natural disasters occurring in a country where the funds invest could cause the funds’ investments in that country to experience gains or losses. Investing in emerging markets may accentuate these risks.
9. Federal Tax Information
The tax character of distributions paid during the years ended July 31, 2009 and July 31, 2008 (except as noted) were as follows:
LIVESTRONG Income Portfolio | LIVESTRONG 2015 Portfolio | |||
2009 | 2008 | 2009 | 2008 | |
Distributions Paid From | ||||
Ordinary income | $2,620,426 | $2,484,675 | $7,270,766 | $6,519,958 |
Long-term capital gains | $507,585 | $69,605 | $2,187,036 | $360,253 |
LIVESTRONG 2020 Portfolio | LIVESTRONG 2025 Portfolio | |||
2009 | 2008(1) | 2009 | 2008 | |
Distributions Paid From | ||||
Ordinary income | $107,135 | — | $8,901,760 | $8,389,158 |
Long-term capital gains | — | — | $3,636,416 | $558,427 |
LIVESTRONG 2030 Portfolio | LIVESTRONG 2035 Portfolio | |||
2009 | 2008(1) | 2009 | 2008 | |
Distributions Paid From | ||||
Ordinary income | $65,520 | — | $4,337,204 | $4,518,519 |
Long-term capital gains | — | — | $2,471,072 | $211,355 |
LIVESTRONG 2040 Portfolio | LIVESTRONG 2045 Portfolio | |||
2009 | 2008(1) | 2009 | 2008 | |
Distributions Paid From | ||||
Ordinary income | $31,043 | — | $2,539,862 | $3,160,271 |
Long-term capital gains | — | — | $1,778,382 | $142,367 |
LIVESTRONG 2050 Portfolio | ||||
2009 | 2008(1) | |||
Distributions Paid From | ||||
Ordinary income | $19,544 | — | ||
Long-term capital gains | — | — | ||
(1) May 30, 2008 (fund inception) through July 31, 2008. |
The book-basis character of distributions made during the year from net investment income or net realized gains may differ from their ultimate characterization for federal income tax purposes. These differences reflect the differing character of certain income items and net realized gains and losses for financial statement and tax purposes, and may result in reclassification among certain capital accounts on the financial statements.
59
As of July 31, 2009, the components of distributable earnings on a tax-basis and the federal tax cost of investments were as follows:
LIVESTRONG | LIVESTRONG | LIVESTRONG | LIVESTRONG | LIVESTRONG | |
Income Portfolio | 2015 Portfolio | 2020 Portfolio | 2025 Portfolio | 2030 Portfolio | |
Federal tax cost of investments | $158,500,794 | $343,639,020 | $112,552,341 | $486,556,395 | $88,110,341 |
Gross tax appreciation | |||||
of investments | — | $ 615,957 | $7,471,643 | $ 2,282,289 | $6,753,949 |
Gross tax depreciation | |||||
of investments | $(294,498) | (13,886,226) | — | (30,904,107) | — |
Net tax appreciation | |||||
(depreciation) of investments | $(294,498) | $(13,270,269) | $7,471,643 | $(28,621,818) | $6,753,949 |
Undistributed ordinary income | $151,679 | $2,488,864 | $914,392 | $3,057,750 | $652,522 |
Accumulated long-term gains | — | — | $12,918 | — | $7,605 |
Accumulated capital losses | $(176,528) | $(371,990) | — | $(566,597) | — |
Capital loss deferrals | $(2,546,567) | $(3,727,536) | — | $(3,036,233) | — |
LIVESTRONG | LIVESTRONG | LIVESTRONG | LIVESTRONG | ||
2035 Portfolio | 2040 Portfolio | 2045 Portfolio | 2050 Portfolio | ||
Federal tax cost of investments | $284,286,397 | $34,824,590 | $163,354,276 | $6,684,699 | |
Gross tax appreciation | |||||
of investments | $ 1,168,232 | $3,305,604 | $ 391,389 | $471,111 | |
Gross tax depreciation | |||||
of investments | (24,766,391) | — | (21,505,540) | — | |
Net tax appreciation | |||||
(depreciation) of investments | $(23,598,159) | $3,305,604 | $(21,114,151) | $471,111 | |
Undistributed ordinary income | $1,510,022 | $218,895 | $744,269 | $32,742 | |
Accumulated long-term gains | — | $1,440 | — | $1,549 | |
Accumulated capital losses | $(456,604) | — | $(357,580) | — | |
Capital loss deferrals | $(2,677,709) | — | $(1,705,190) | — |
The difference between book-basis and tax-basis cost and unrealized appreciation (depreciation) is attributable primarily to the tax deferral of losses on wash sales.
The accumulated capital losses listed above represent net capital loss carryovers that may be used to offset future realized capital gains for federal income tax purposes. Future capital loss carryover utilization in any given year may be limited due to large shareholder redemptions and contributions. The capital loss carryovers expire in 2017.
The capital loss deferrals listed above represent net capital losses incurred in the nine-month period ended July 31, 2009. The funds have elected to treat such losses as having been incurred in the following fiscal year for federal income tax purposes.
10. Recently Issued Accounting Standards
The Financial Accounting Standards Board (FASB) issued Statement of Financial Accounting Standards No. 157, “Fair Value Measurements” (FAS 157), in September 2006, which is effective for fiscal years beginning after November 15, 2007. FAS 157 defines fair value, establishes a framework for measuring fair value and expands the required financial statement disclosures about fair value measurements. The adoption of FAS 157 did not materially impact the determination of fair value.
60
In March 2008, the FASB issued Statement of Financial Accounting Standards No. 161, “Disclosures about Derivative Instruments and Hedging Activities — an amendment of FASB Statement No. 133” (FAS 161). FAS 161 is effective for interim periods beginning after November 15, 2008 and has been adopted by the funds. FAS 161 amends and expands disclosures about derivative instruments and hedging activities. FAS 161 requires qualitative disclosures about the objectives and strategies of derivative instruments, quantitative disclosures about the fair value amounts of and gains and losses on derivative instruments, and disclosures of credit-risk-related contingent features in hedging activities.
11. Other Tax Information (Unaudited)
The following information is provided pursuant to provisions of the Internal Revenue Code.
The funds hereby designate up to the maximum amount allowable as qualified dividend income for the fiscal year ended July 31, 2009.
For corporate taxpayers, the funds hereby designate the following ordinary income distributions, or up to the maximum amount allowable, as qualified for the corporate dividends received deduction for the fiscal year ended July 31, 2009.
LIVESTRONG Income Portfolio | LIVESTRONG 2015 Portfolio | LIVESTRONG 2020 Portfolio |
$800,466 | $4,831,612 | $107,028 |
LIVESTRONG 2025 Portfolio | LIVESTRONG 2030 Portfolio | LIVESTRONG 2035 Portfolio |
$6,570,794 | $65,464 | $3,623,806 |
LIVESTRONG 2040 Portfolio | LIVESTRONG 2045 Portfolio | LIVESTRONG 2050 Portfolio |
$31,043 | $2,229,546 | $19,526 |
The funds hereby designate the following long-term capital gain distributions, or up to the | ||
maximum amount allowable, for the fiscal year ended July 31, 2009. | ||
LIVESTRONG Income Portfolio | LIVESTRONG 2015 Portfolio | LIVESTRONG 2020 Portfolio |
$507,585 | $2,187,036 | — |
LIVESTRONG 2025 Portfolio | LIVESTRONG 2030 Portfolio | LIVESTRONG 2035 Portfolio |
$3,636,416 | — | $2,471,072 |
LIVESTRONG 2040 Portfolio | LIVESTRONG 2045 Portfolio | LIVESTRONG 2050 Portfolio |
— | $1,778,382 | — |
The funds hereby designate the following distributions as qualified short-term capital | ||
gains for purposes of Internal Revenue Code Section 871. | ||
LIVESTRONG Income Portfolio | LIVESTRONG 2015 Portfolio | LIVESTRONG 2020 Portfolio |
$61,608 | $436,638 | — |
LIVESTRONG 2025 Portfolio | LIVESTRONG 2030 Portfolio | LIVESTRONG 2035 Portfolio |
$787,466 | — | $473,374 |
LIVESTRONG 2040 Portfolio | LIVESTRONG 2045 Portfolio | LIVESTRONG 2050 Portfolio |
$3 | $250,568 | — |
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Financial Highlights | |
LIVESTRONG Income Portfolio |
Investor Class | |||||
For a Share Outstanding Throughout the Years Ended July 31 (except as noted) | |||||
2009 | 2008 | 2007 | 2006 | 2005(1) | |
Per-Share Data | |||||
Net Asset Value, Beginning of Period | $10.64 | $11.06 | $10.45 | $10.51 | $10.00 |
Income From Investment Operations | |||||
Net Investment Income (Loss)(2) | 0.24 | 0.40 | 0.33 | 0.37 | 0.29 |
Net Realized and Unrealized Gain (Loss) | (0.95) | (0.38) | 0.75 | (0.07) | 0.52 |
Total From Investment Operations | (0.71) | 0.02 | 1.08 | 0.30 | 0.81 |
Distributions | |||||
From Net Investment Income | (0.31) | (0.42) | (0.32) | (0.35) | (0.30) |
From Net Realized Gains | (0.09) | (0.02) | (0.15) | (0.01) | — |
Total Distributions | (0.40) | (0.44) | (0.47) | (0.36) | (0.30) |
Net Asset Value, End of Period | $9.53 | $10.64 | $11.06 | $10.45 | $10.51 |
Total Return(3) | (6.44)% | 0.11% | 10.51% | 2.99% | 8.14% |
Ratios/Supplemental Data | |||||
Ratio of Operating Expenses | |||||
to Average Net Assets(4) | 0.20% | 0.20% | 0.20% | 0.20% | 0.20%(5) |
Ratio of Net Investment Income (Loss) | |||||
to Average Net Assets | 2.64% | 3.61% | 3.03% | 3.51% | 3.16%(5) |
Portfolio Turnover Rate | 51% | 26% | 22% | 120% | 6% |
Net Assets, End of Period (in thousands) | $95,441 | $49,378 | $44,109 | $27,374 | $15,572 |
(1) | August 31, 2004 (fund inception) through July 31, 2005. |
(2) | Computed using average shares outstanding throughout the period. |
(3) | Total return assumes reinvestment of net investment income and capital gains distributions, if any. Total returns for periods less than one year are not annualized. The total return of the classes may not precisely reflect the class expense differences because of the impact of calculating the net asset values to two decimal places. If net asset values were calculated to three decimal places, the total return differences would more closely reflect the class expense differences. The calculation of net asset values to two decimal places is made in accordance with SEC guidelines and does not result in any gain or loss of value between one class and another. |
(4) | Ratio of operating expenses to average net assets does not include any expenses of the underlying funds. |
(5) | Annualized. |
See Notes to Financial Statements.
62
LIVESTRONG Income Portfolio | |||||
Institutional Class | |||||
For a Share Outstanding Throughout the Years Ended July 31 (except as noted) | |||||
2009 | 2008 | 2007 | 2006 | 2005(1) | |
Per-Share Data | |||||
Net Asset Value, Beginning of Period | $10.64 | $11.06 | $10.45 | $10.51 | $10.00 |
Income From Investment Operations | |||||
Net Investment Income (Loss)(2) | 0.26 | 0.42 | 0.35 | 0.37 | 0.34 |
Net Realized and Unrealized Gain (Loss) | (0.95) | (0.38) | 0.75 | (0.05) | 0.48 |
Total From Investment Operations | (0.69) | 0.04 | 1.10 | 0.32 | 0.82 |
Distributions | |||||
From Net Investment Income | (0.33) | (0.44) | (0.34) | (0.37) | (0.31) |
From Net Realized Gains | (0.09) | (0.02) | (0.15) | (0.01) | — |
Total Distributions | (0.42) | (0.46) | (0.49) | (0.38) | (0.31) |
Net Asset Value, End of Period | $9.53 | $10.64 | $11.06 | $10.45 | $10.51 |
Total Return(3) | (6.25)% | 0.31% | 10.73% | 3.20% | 8.31% |
Ratios/Supplemental Data | |||||
Ratio of Operating Expenses | |||||
to Average Net Assets(4) | 0.00% | 0.00% | 0.00% | 0.00% | 0.00%(5) |
Ratio of Net Investment Income (Loss) | |||||
to Average Net Assets | 2.84% | 3.81% | 3.23% | 3.71% | 3.36%(5) |
Portfolio Turnover Rate | 51% | 26% | 22% | 120% | 6% |
Net Assets, End of Period (in thousands) | $25,088 | $9,737 | $8,285 | $4,409 | $3,169 |
(1) | August 31, 2004 (fund inception) through July 31, 2005. |
(2) | Computed using average shares outstanding throughout the period. |
(3) | Total return assumes reinvestment of net investment income and capital gains distributions, if any. Total returns for periods less than one year are not annualized. The total return of the classes may not precisely reflect the class expense differences because of the impact of calculating the net asset values to two decimal places. If net asset values were calculated to three decimal places, the total return differences would more closely reflect the class expense differences. The calculation of net asset values to two decimal places is made in accordance with SEC guidelines and does not result in any gain or loss of value between one class and another. |
(4) | Ratio of operating expenses to average net assets does not include any expenses of the underlying funds. Other expenses, which include the fees and expenses of the fund’s independent directors and its legal counsel, as well as interest, did not exceed 0.005%. |
(5) | Annualized. |
See Notes to Financial Statements.
63
LIVESTRONG Income Portfolio | |||||
Advisor Class | |||||
For a Share Outstanding Throughout the Years Ended July 31 (except as noted) | |||||
2009 | 2008 | 2007 | 2006 | 2005(1) | |
Per-Share Data | |||||
Net Asset Value, Beginning of Period | $10.64 | $11.05 | $10.45 | $10.51 | $10.00 |
Income From Investment Operations | |||||
Net Investment Income (Loss)(2) | 0.21 | 0.35 | 0.31 | 0.33 | 0.18 |
Net Realized and Unrealized Gain (Loss) | (0.94) | (0.35) | 0.74 | (0.05) | 0.61 |
Total From Investment Operations | (0.73) | — | 1.05 | 0.28 | 0.79 |
Distributions | |||||
From Net Investment Income | (0.29) | (0.39) | (0.30) | (0.33) | (0.28) |
From Net Realized Gains | (0.09) | (0.02) | (0.15) | (0.01) | — |
Total Distributions | (0.38) | (0.41) | (0.45) | (0.34) | (0.28) |
Net Asset Value, End of Period | $9.53 | $10.64 | $11.05 | $10.45 | $10.51 |
Total Return(3) | (6.67)% | (0.05)% | 10.13% | 2.83% | 7.82% |
Ratios/Supplemental Data | |||||
Ratio of Operating Expenses | |||||
to Average Net Assets(4) | 0.45% | 0.45% | 0.45% | 0.45% | 0.45%(5) |
Ratio of Net Investment Income (Loss) | |||||
to Average Net Assets | 2.39% | 3.36% | 2.78% | 3.26% | 2.91%(5) |
Portfolio Turnover Rate | 51% | 26% | 22% | 120% | 6% |
Net Assets, End of Period (in thousands) | $34,202 | $8,285 | $8,129 | $2,966 | $940 |
(1) | August 31, 2004 (fund inception) through July 31, 2005. |
(2) | Computed using average shares outstanding throughout the period. |
(3) | Total return assumes reinvestment of net investment income and capital gains distributions, if any. Total returns for periods less than one year are not annualized. The total return of the classes may not precisely reflect the class expense differences because of the impact of calculating the net asset values to two decimal places. If net asset values were calculated to three decimal places, the total return differences would more closely reflect the class expense differences. The calculation of net asset values to two decimal places is made in accordance with SEC guidelines and does not result in any gain or loss of value between one class and another. |
(4) | Ratio of operating expenses to average net assets does not include any expenses of the underlying funds. |
(5) | Annualized. |
See Notes to Financial Statements.
64
LIVESTRONG Income Portfolio | |||||
R Class | |||||
For a Share Outstanding Throughout the Years Ended July 31 (except as noted) | |||||
2009 | 2008 | 2007 | 2006 | 2005(1) | |
Per-Share Data | |||||
Net Asset Value, Beginning of Period | $10.63 | $11.05 | $10.44 | $10.50 | $10.00 |
Income From Investment Operations | |||||
Net Investment Income (Loss)(2) | 0.18 | 0.30 | 0.27 | 0.26 | 0.29 |
Net Realized and Unrealized Gain (Loss) | (0.93) | (0.34) | 0.76 | (0.01) | 0.46 |
Total From Investment Operations | (0.75) | (0.04) | 1.03 | 0.25 | 0.75 |
Distributions | |||||
From Net Investment Income | (0.27) | (0.36) | (0.27) | (0.30) | (0.25) |
From Net Realized Gains | (0.09) | (0.02) | (0.15) | (0.01) | — |
Total Distributions | (0.36) | (0.38) | (0.42) | (0.31) | (0.25) |
Net Asset Value, End of Period | $9.52 | $10.63 | $11.05 | $10.44 | $10.50 |
Total Return(3) | (6.91)% | (0.40)% | 9.97% | 2.48% | 7.61% |
Ratios/Supplemental Data | |||||
Ratio of Operating Expenses | |||||
to Average Net Assets(4) | 0.70% | 0.70% | 0.70% | 0.70% | 0.70%(5) |
Ratio of Net Investment Income (Loss) | |||||
to Average Net Assets | 2.14% | 3.11% | 2.53% | 3.01% | 2.66%(5) |
Portfolio Turnover Rate | 51% | 26% | 22% | 120% | 6% |
Net Assets, End of Period (in thousands) | $3,466 | $351 | $112 | $37 | $9 |
(1) | August 31, 2004 (fund inception) through July 31, 2005. |
(2) | Computed using average shares outstanding throughout the period. |
(3) | Total return assumes reinvestment of net investment income and capital gains distributions, if any. Total returns for periods less than one year are not annualized. The total return of the classes may not precisely reflect the class expense differences because of the impact of calculating the net asset values to two decimal places. If net asset values were calculated to three decimal places, the total return differences would more closely reflect the class expense differences. The calculation of net asset values to two decimal places is made in accordance with SEC guidelines and does not result in any gain or loss of value between one class and another. |
(4) | Ratio of operating expenses to average net assets does not include any expenses of the underlying funds. |
(5) | Annualized. |
See Notes to Financial Statements.
65
LIVESTRONG 2015 Portfolio | |||||
Investor Class | |||||
For a Share Outstanding Throughout the Years Ended July 31 (except as noted) | |||||
2009 | 2008 | 2007 | 2006 | 2005(1) | |
Per-Share Data | |||||
Net Asset Value, Beginning of Period | $11.39 | $11.91 | $11.09 | $10.93 | $10.00 |
Income From Investment Operations | |||||
Net Investment Income (Loss)(2) | 0.26 | 0.43 | 0.32 | 0.37 | 0.25 |
Net Realized and Unrealized Gain (Loss) | (1.29) | (0.49) | 1.04 | 0.11 | 0.86 |
Total From Investment Operations | (1.03) | (0.06) | 1.36 | 0.48 | 1.11 |
Distributions | |||||
From Net Investment Income | (0.35) | (0.41) | (0.27) | (0.31) | (0.18) |
From Net Realized Gains | (0.14) | (0.05) | (0.27) | (0.01) | — |
Total Distributions | (0.49) | (0.46) | (0.54) | (0.32) | (0.18) |
Net Asset Value, End of Period | $9.87 | $11.39 | $11.91 | $11.09 | $10.93 |
Total Return(3) | (8.63)% | (0.67)% | 12.46% | 4.46% | 11.17% |
Ratios/Supplemental Data | |||||
Ratio of Operating Expenses | |||||
to Average Net Assets(4) | 0.20% | 0.20% | 0.20% | 0.20% | 0.20%(5) |
Ratio of Net Investment Income (Loss) | |||||
to Average Net Assets | 2.78% | 3.62% | 2.74% | 3.27% | 2.61%(5) |
Portfolio Turnover Rate | 28% | 20% | 18% | 123% | 2% |
Net Assets, End of Period (in thousands) | $217,149 | $161,838 | $139,725 | $89,431 | $40,717 |
(1) | August 31, 2004 (fund inception) through July 31, 2005. |
(2) | Computed using average shares outstanding throughout the period. |
(3) | Total return assumes reinvestment of net investment income and capital gains distributions, if any. Total returns for periods less than one year are not annualized. The total return of the classes may not precisely reflect the class expense differences because of the impact of calculating the net asset values to two decimal places. If net asset values were calculated to three decimal places, the total return differences would more closely reflect the class expense differences. The calculation of net asset values to two decimal places is made in accordance with SEC guidelines and does not result in any gain or loss of value between one class and another. |
(4) | Ratio of operating expenses to average net assets does not include any expenses of the underlying funds. |
(5) | Annualized. |
See Notes to Financial Statements.
66
LIVESTRONG 2015 Portfolio | |||||
Institutional Class | |||||
For a Share Outstanding Throughout the Years Ended July 31 (except as noted) | |||||
2009 | 2008 | 2007 | 2006 | 2005(1) | |
Per-Share Data | |||||
Net Asset Value, Beginning of Period | $11.41 | $11.93 | $11.10 | $10.94 | $10.00 |
Income From Investment Operations | |||||
Net Investment Income (Loss)(2) | 0.24 | 0.44 | 0.34 | 0.33 | 0.29 |
Net Realized and Unrealized Gain (Loss) | (1.25) | (0.48) | 1.05 | 0.17 | 0.84 |
Total From Investment Operations | (1.01) | (0.04) | 1.39 | 0.50 | 1.13 |
Distributions | |||||
From Net Investment Income | (0.37) | (0.43) | (0.29) | (0.33) | (0.19) |
From Net Realized Gains | (0.14) | (0.05) | (0.27) | (0.01) | — |
Total Distributions | (0.51) | (0.48) | (0.56) | (0.34) | (0.19) |
Net Asset Value, End of Period | $9.89 | $11.41 | $11.93 | $11.10 | $10.94 |
Total Return(3) | (8.42)% | (0.46)% | 12.77% | 4.67% | 11.32% |
Ratios/Supplemental Data | |||||
Ratio of Operating Expenses | |||||
to Average Net Assets(4) | 0.00% | 0.00% | 0.00% | 0.00% | 0.00%(5) |
Ratio of Net Investment Income (Loss) | |||||
to Average Net Assets | 2.98% | 3.82% | 2.94% | 3.47% | 2.81%(5) |
Portfolio Turnover Rate | 28% | 20% | 18% | 123% | 2% |
Net Assets, End of Period (in thousands) | $59,500 | $17,845 | $15,736 | $10,439 | $3,011 |
(1) | August 31, 2004 (fund inception) through July 31, 2005. |
(2) | Computed using average shares outstanding throughout the period. |
(3) | Total return assumes reinvestment of net investment income and capital gains distributions, if any. Total returns for periods less than one year are not annualized. The total return of the classes may not precisely reflect the class expense differences because of the impact of calculating the net asset values to two decimal places. If net asset values were calculated to three decimal places, the total return differences would more closely reflect the class expense differences. The calculation of net asset values to two decimal places is made in accordance with SEC guidelines and does not result in any gain or loss of value between one class and another. |
(4) | Ratio of operating expenses to average net assets does not include any expenses of the underlying funds. Other expenses, which include the fees and expenses of the fund’s independent directors and its legal counsel, as well as interest, did not exceed 0.005%. |
(5) | Annualized. |
See Notes to Financial Statements.
67
LIVESTRONG 2015 Portfolio | |||||
Advisor Class | |||||
For a Share Outstanding Throughout the Years Ended July 31 (except as noted) | |||||
2009 | 2008 | 2007 | 2006 | 2005(1) | |
Per-Share Data | |||||
Net Asset Value, Beginning of Period | $11.37 | $11.89 | $11.07 | $10.91 | $10.00 |
Income From Investment Operations | |||||
Net Investment Income (Loss)(2) | 0.25 | 0.38 | 0.30 | 0.31 | 0.17 |
Net Realized and Unrealized Gain (Loss) | (1.29) | (0.47) | 1.03 | 0.14 | 0.91 |
Total From Investment Operations | (1.04) | (0.09) | 1.33 | 0.45 | 1.08 |
Distributions | |||||
From Net Investment Income | (0.33) | (0.38) | (0.24) | (0.28) | (0.17) |
From Net Realized Gains | (0.14) | (0.05) | (0.27) | (0.01) | — |
Total Distributions | (0.47) | (0.43) | (0.51) | (0.29) | (0.17) |
Net Asset Value, End of Period | $9.86 | $11.37 | $11.89 | $11.07 | $10.91 |
Total Return(3) | (8.79)% | (0.93)% | 12.20% | 4.22% | 10.88% |
Ratios/Supplemental Data | |||||
Ratio of Operating Expenses | |||||
to Average Net Assets(4) | 0.45% | 0.45% | 0.45% | 0.45% | 0.45%(5) |
Ratio of Net Investment Income (Loss) | |||||
to Average Net Assets | 2.53% | 3.37% | 2.49% | 3.02% | 2.36%(5) |
Portfolio Turnover Rate | 28% | 20% | 18% | 123% | 2% |
Net Assets, End of Period (in thousands) | $40,386 | $24,384 | $19,270 | $9,556 | $323 |
(1) | August 31, 2004 (fund inception) through July 31, 2005. |
(2) | Computed using average shares outstanding throughout the period. |
(3) | Total return assumes reinvestment of net investment income and capital gains distributions, if any. Total returns for periods less than one year are not annualized. The total return of the classes may not precisely reflect the class expense differences because of the impact of calculating the net asset values to two decimal places. If net asset values were calculated to three decimal places, the total return differences would more closely reflect the class expense differences. The calculation of net asset values to two decimal places is made in accordance with SEC guidelines and does not result in any gain or loss of value between one class and another. |
(4) | Ratio of operating expenses to average net assets does not include any expenses of the underlying funds. |
(5) | Annualized. |
See Notes to Financial Statements.
68
LIVESTRONG 2015 Portfolio | |||||
R Class | |||||
For a Share Outstanding Throughout the Years Ended July 31 (except as noted) | |||||
2009 | 2008 | 2007 | 2006 | 2005(1) | |
Per-Share Data | |||||
Net Asset Value, Beginning of Period | $11.36 | $11.88 | $11.06 | $10.90 | $10.00 |
Income From Investment Operations | |||||
Net Investment Income (Loss)(2) | 0.18 | 0.39 | 0.25 | 0.19 | 0.24 |
Net Realized and Unrealized Gain (Loss) | (1.25) | (0.51) | 1.05 | 0.23 | 0.82 |
Total From Investment Operations | (1.07) | (0.12) | 1.30 | 0.42 | 1.06 |
Distributions | |||||
From Net Investment Income | (0.31) | (0.35) | (0.21) | (0.25) | (0.16) |
From Net Realized Gains | (0.14) | (0.05) | (0.27) | (0.01) | — |
Total Distributions | (0.45) | (0.40) | (0.48) | (0.26) | (0.16) |
Net Asset Value, End of Period | $9.84 | $11.36 | $11.88 | $11.06 | $10.90 |
Total Return(3) | (9.12)% | (1.19)% | 11.92% | 4.05% | 10.59% |
Ratios/Supplemental Data | |||||
Ratio of Operating Expenses | |||||
to Average Net Assets(4) | 0.70% | 0.70% | 0.70% | 0.70% | 0.70%(5) |
Ratio of Net Investment Income (Loss) | |||||
to Average Net Assets | 2.28% | 3.12% | 2.24% | 2.77% | 2.11%(5) |
Portfolio Turnover Rate | 28% | 20% | 18% | 123% | 2% |
Net Assets, End of Period (in thousands) | $13,316 | $4,165 | $3,187 | $351 | $14 |
(1) | August 31, 2004 (fund inception) through July 31, 2005. |
(2) | Computed using average shares outstanding throughout the period. |
(3) | Total return assumes reinvestment of net investment income and capital gains distributions, if any. Total returns for periods less than one year are not annualized. The total return of the classes may not precisely reflect the class expense differences because of the impact of calculating the net asset values to two decimal places. If net asset values were calculated to three decimal places, the total return differences would more closely reflect the class expense differences. The calculation of net asset values to two decimal places is made in accordance with SEC guidelines and does not result in any gain or loss of value between one class and another. |
(4) | Ratio of operating expenses to average net assets does not include any expenses of the underlying funds. |
(5) | Annualized. |
See Notes to Financial Statements.
69
LIVESTRONG 2020 Portfolio | ||
Investor Class | ||
For a Share Outstanding Throughout the Years Ended July 31 (except as noted) | ||
2009 | 2008(1) | |
Per-Share Data | ||
Net Asset Value, Beginning of Period | $9.49 | $10.00 |
Income From Investment Operations | ||
Net Investment Income (Loss)(2) | 0.13 | 0.03 |
Net Realized and Unrealized Gain (Loss) | (1.03) | (0.54) |
Total From Investment Operations | (0.90) | (0.51) |
Distributions | ||
From Net Investment Income | (0.12) | — |
Net Asset Value, End of Period | $8.47 | $9.49 |
Total Return(3) | (9.38)% | (5.10)% |
Ratios/Supplemental Data | ||
Ratio of Operating Expenses to Average Net Assets(4) | 0.20% | 0.20%(5) |
Ratio of Net Investment Income (Loss) to Average Net Assets | 1.70% | 1.89%(5) |
Portfolio Turnover Rate | 53% | 0% |
Net Assets, End of Period (in thousands) | $91,329 | $1,073 |
(1) | May 30, 2008 (fund inception) through July 31, 2008. |
(2) | Computed using average shares outstanding throughout the period. |
(3) | Total return assumes reinvestment of net investment income and capital gains distributions, if any. Total returns for periods less than one year are not annualized. The total return of the classes may not precisely reflect the class expense differences because of the impact of calculating the net asset values to two decimal places. If net asset values were calculated to three decimal places, the total return differences would more closely reflect the class expense differences. The calculation of net asset values to two decimal places is made in accordance with SEC guidelines and does not result in any gain or loss of value between one class and another. |
(4) | Ratio of operating expenses to average net assets does not include any expenses of the underlying funds. |
(5) | Annualized. |
See Notes to Financial Statements.
70
LIVESTRONG 2020 Portfolio | ||
Institutional Class | ||
For a Share Outstanding Throughout the Years Ended July 31 (except as noted) | ||
2009 | 2008(1) | |
Per-Share Data | ||
Net Asset Value, Beginning of Period | $9.50 | $10.00 |
Income From Investment Operations | ||
Net Investment Income (Loss)(2) | 0.15 | 0.04 |
Net Realized and Unrealized Gain (Loss) | (1.05) | (0.54) |
Total From Investment Operations | (0.90) | (0.50) |
Distributions | ||
From Net Investment Income | (0.13) | — |
Net Asset Value, End of Period | $8.47 | $9.50 |
Total Return(3) | (9.26)% | (5.00)% |
Ratios/Supplemental Data | ||
Ratio of Operating Expenses to Average Net Assets(4) | 0.00% | 0.00%(5) |
Ratio of Net Investment Income (Loss) to Average Net Assets | 1.90% | 2.09%(5) |
Portfolio Turnover Rate | 53% | 0% |
Net Assets, End of Period (in thousands) | $21,532 | $16 |
(1) | May 30, 2008 (fund inception) through July 31, 2008. |
(2) | Computed using average shares outstanding throughout the period. |
(3) | Total return assumes reinvestment of net investment income and capital gains distributions, if any. Total returns for periods less than one year are not annualized. The total return of the classes may not precisely reflect the class expense differences because of the impact of calculating the net asset values to two decimal places. If net asset values were calculated to three decimal places, the total return differences would more closely reflect the class expense differences. The calculation of net asset values to two decimal places is made in accordance with SEC guidelines and does not result in any gain or loss of value between one class and another. |
(4) | Ratio of operating expenses to average net assets does not include any expenses of the underlying funds. Other expenses, which include the fees and expenses of the fund’s independent directors and its legal counsel, as well as interest, did not exceed 0.005%. |
(5) | Annualized. |
See Notes to Financial Statements.
71
LIVESTRONG 2020 Portfolio | ||
Advisor Class | ||
For a Share Outstanding Throughout the Years Ended July 31 (except as noted) | ||
2009 | 2008(1) | |
Per-Share Data | ||
Net Asset Value, Beginning of Period | $9.49 | $10.00 |
Income From Investment Operations | ||
Net Investment Income (Loss)(2) | 0.15 | 0.04 |
Net Realized and Unrealized Gain (Loss) | (1.08) | (0.55) |
Total From Investment Operations | (0.93) | (0.51) |
Distributions | ||
From Net Investment Income | (0.11) | — |
Net Asset Value, End of Period | $8.45 | $9.49 |
Total Return(3) | (9.72)% | (5.10)% |
Ratios/Supplemental Data | ||
Ratio of Operating Expenses to Average Net Assets(4) | 0.45% | 0.45%(5) |
Ratio of Net Investment Income (Loss) to Average Net Assets | 1.45% | 1.64%(5) |
Portfolio Turnover Rate | 53% | 0% |
Net Assets, End of Period (in thousands) | $3,882 | $6 |
(1) | May 30, 2008 (fund inception) through July 31, 2008. |
(2) | Computed using average shares outstanding throughout the period. |
(3) | Total return assumes reinvestment of net investment income and capital gains distributions, if any. Total returns for periods less than one year are not annualized. The total return of the classes may not precisely reflect the class expense differences because of the impact of calculating the net asset values to two decimal places. If net asset values were calculated to three decimal places, the total return differences would more closely reflect the class expense differences. The calculation of net asset values to two decimal places is made in accordance with SEC guidelines and does not result in any gain or loss of value between one class and another. |
(4) | Ratio of operating expenses to average net assets does not include any expenses of the underlying funds. |
(5) | Annualized. |
See Notes to Financial Statements.
72
LIVESTRONG 2020 Portfolio | ||
R Class | ||
For a Share Outstanding Throughout the Years Ended July 31 (except as noted) | ||
2009 | 2008(1) | |
Per-Share Data | ||
Net Asset Value, Beginning of Period | $9.49 | $10.00 |
Income From Investment Operations | ||
Net Investment Income (Loss)(2) | 0.14 | 0.03 |
Net Realized and Unrealized Gain (Loss) | (1.10) | (0.54) |
Total From Investment Operations | (0.96) | (0.51) |
Distributions | ||
From Net Investment Income | (0.09) | — |
Net Asset Value, End of Period | $8.44 | $9.49 |
Total Return(3) | (9.96)% | (5.10)% |
Ratios/Supplemental Data | ||
Ratio of Operating Expenses to Average Net Assets(4) | 0.70% | 0.70%(5) |
Ratio of Net Investment Income (Loss) to Average Net Assets | 1.20% | 1.39%(5) |
Portfolio Turnover Rate | 53% | 0% |
Net Assets, End of Period (in thousands) | $3,274 | $6 |
(1) | May 30, 2008 (fund inception) through July 31, 2008. |
(2) | Computed using average shares outstanding throughout the period. |
(3) | Total return assumes reinvestment of net investment income and capital gains distributions, if any. Total returns for periods less than one year are not annualized. The total return of the classes may not precisely reflect the class expense differences because of the impact of calculating the net asset values to two decimal places. If net asset values were calculated to three decimal places, the total return differences would more closely reflect the class expense differences. The calculation of net asset values to two decimal places is made in accordance with SEC guidelines and does not result in any gain or loss of value between one class and another. |
(4) | Ratio of operating expenses to average net assets does not include any expenses of the underlying funds. |
(5) | Annualized. |
See Notes to Financial Statements.
73
LIVESTRONG 2025 Portfolio | |||||
Investor Class | |||||
For a Share Outstanding Throughout the Years Ended July 31 (except as noted) | |||||
2009 | 2008 | 2007 | 2006 | 2005(1) | |
Per-Share Data | |||||
Net Asset Value, Beginning of Period | $11.63 | $12.35 | $11.49 | $11.21 | $10.00 |
Income From Investment Operations | |||||
Net Investment Income (Loss)(2) | 0.22 | 0.42 | 0.28 | 0.34 | 0.18 |
Net Realized and Unrealized Gain (Loss) | (1.63) | (0.69) | 1.34 | 0.27 | 1.17 |
Total From Investment Operations | (1.41) | (0.27) | 1.62 | 0.61 | 1.35 |
Distributions | |||||
From Net Investment Income | (0.30) | (0.40) | (0.24) | (0.31) | (0.14) |
From Net Realized Gains | (0.16) | (0.05) | (0.52) | (0.02) | — |
Total Distributions | (0.46) | (0.45) | (0.76) | (0.33) | (0.14) |
Net Asset Value, End of Period | $9.76 | $11.63 | $12.35 | $11.49 | $11.21 |
Total Return(3) | (11.64)% | (2.39)% | 14.45% | 5.48% | 13.57% |
Ratios/Supplemental Data | |||||
Ratio of Operating Expenses | |||||
to Average Net Assets(4) | 0.20% | 0.20% | 0.20% | 0.20% | 0.20%(5) |
Ratio of Net Investment Income (Loss) | |||||
to Average Net Assets | 2.43% | 3.40% | 2.34% | 2.98% | 2.08%(5) |
Portfolio Turnover Rate | 22% | 18% | 18% | 120% | 2% |
Net Assets, End of Period (in thousands) | $313,816 | $215,024 | $174,984 | $112,202 | $53,285 |
(1) | August 31, 2004 (fund inception) through July 31, 2005. |
(2) | Computed using average shares outstanding throughout the period. |
(3) | Total return assumes reinvestment of net investment income and capital gains distributions, if any. Total returns for periods less than one year are not annualized. The total return of the classes may not precisely reflect the class expense differences because of the impact of calculating the net asset values to two decimal places. If net asset values were calculated to three decimal places, the total return differences would more closely reflect the class expense differences. The calculation of net asset values to two decimal places is made in accordance with SEC guidelines and does not result in any gain or loss of value between one class and another. |
(4) | Ratio of operating expenses to average net assets does not include any expenses of the underlying funds. |
(5) | Annualized. |
See Notes to Financial Statements.
74
LIVESTRONG 2025 Portfolio | |||||
Institutional Class | |||||
For a Share Outstanding Throughout the Years Ended July 31 (except as noted) | |||||
2009 | 2008 | 2007 | 2006 | 2005(1) | |
Per-Share Data | |||||
Net Asset Value, Beginning of Period | $11.64 | $12.37 | $11.51 | $11.23 | $10.00 |
Income From Investment Operations | |||||
Net Investment Income (Loss)(2) | 0.24 | 0.43 | 0.31 | 0.37 | 0.27 |
Net Realized and Unrealized Gain (Loss) | (1.63) | (0.69) | 1.34 | 0.26 | 1.11 |
Total From Investment Operations | (1.39) | (0.26) | 1.65 | 0.63 | 1.38 |
Distributions | |||||
From Net Investment Income | (0.32) | (0.42) | (0.27) | (0.33) | (0.15) |
From Net Realized Gains | (0.16) | (0.05) | (0.52) | (0.02) | — |
Total Distributions | (0.48) | (0.47) | (0.79) | (0.35) | (0.15) |
Net Asset Value, End of Period | $9.77 | $11.64 | $12.37 | $11.51 | $11.23 |
Total Return(3) | (11.45)% | (2.27)% | 14.67% | 5.77% | 13.74% |
Ratios/Supplemental Data | |||||
Ratio of Operating Expenses | |||||
to Average Net Assets(4) | 0.00% | 0.00% | 0.00% | 0.00% | 0.00%(5) |
Ratio of Net Investment Income (Loss) | |||||
to Average Net Assets | 2.63% | 3.60% | 2.54% | 3.18% | 2.28%(5) |
Portfolio Turnover Rate | 22% | 18% | 18% | 120% | 2% |
Net Assets, End of Period (in thousands) | $78,031 | $44,611 | $44,250 | $31,399 | $21,458 |
(1) | August 31, 2004 (fund inception) through July 31, 2005. |
(2) | Computed using average shares outstanding throughout the period. |
(3) | Total return assumes reinvestment of net investment income and capital gains distributions, if any. Total returns for periods less than one year are not annualized. The total return of the classes may not precisely reflect the class expense differences because of the impact of calculating the net asset values to two decimal places. If net asset values were calculated to three decimal places, the total return differences would more closely reflect the class expense differences. The calculation of net asset values to two decimal places is made in accordance with SEC guidelines and does not result in any gain or loss of value between one class and another. |
(4) | Ratio of operating expenses to average net assets does not include any expenses of the underlying funds. Other expenses, which include the fees and expenses of the fund’s independent directors and its legal counsel, as well as interest, did not exceed 0.005%. |
(5) | Annualized. |
See Notes to Financial Statements.
75
LIVESTRONG 2025 Portfolio | |||||
Advisor Class | |||||
For a Share Outstanding Throughout the Years Ended July 31 (except as noted) | |||||
2009 | 2008 | 2007 | 2006 | 2005(1) | |
Per-Share Data | |||||
Net Asset Value, Beginning of Period | $11.61 | $12.34 | $11.48 | $11.19 | $10.00 |
Income From Investment Operations | |||||
Net Investment Income (Loss)(2) | 0.21 | 0.35 | 0.26 | 0.29 | 0.12 |
Net Realized and Unrealized Gain (Loss) | (1.64) | (0.66) | 1.33 | 0.30 | 1.20 |
Total From Investment Operations | (1.43) | (0.31) | 1.59 | 0.59 | 1.32 |
Distributions | |||||
From Net Investment Income | (0.28) | (0.37) | (0.21) | (0.28) | (0.13) |
From Net Realized Gains | (0.16) | (0.05) | (0.52) | (0.02) | — |
Total Distributions | (0.44) | (0.42) | (0.73) | (0.30) | (0.13) |
Net Asset Value, End of Period | $9.74 | $11.61 | $12.34 | $11.48 | $11.19 |
Total Return(3) | (11.89)% | (2.73)% | 14.17% | 5.30% | 13.28% |
Ratios/Supplemental Data | |||||
Ratio of Operating Expenses | |||||
to Average Net Assets(4) | 0.45% | 0.45% | 0.45% | 0.45% | 0.45%(5) |
Ratio of Net Investment Income (Loss) | |||||
to Average Net Assets | 2.18% | 3.15% | 2.09% | 2.73% | 1.83%(5) |
Portfolio Turnover Rate | 22% | 18% | 18% | 120% | 2% |
Net Assets, End of Period (in thousands) | $49,723 | $28,073 | $17,076 | $7,404 | $388 |
(1) | August 31, 2004 (fund inception) through July 31, 2005. |
(2) | Computed using average shares outstanding throughout the period. |
(3) | Total return assumes reinvestment of net investment income and capital gains distributions, if any. Total returns for periods less than one year are not annualized. The total return of the classes may not precisely reflect the class expense differences because of the impact of calculating the net asset values to two decimal places. If net asset values were calculated to three decimal places, the total return differences would more closely reflect the class expense differences. The calculation of net asset values to two decimal places is made in accordance with SEC guidelines and does not result in any gain or loss of value between one class and another. |
(4) | Ratio of operating expenses to average net assets does not include any expenses of the underlying funds. |
(5) | Annualized. |
See Notes to Financial Statements.
76
LIVESTRONG 2025 Portfolio | |||||
R Class | |||||
For a Share Outstanding Throughout the Years Ended July 31 (except as noted) | |||||
2009 | 2008 | 2007 | 2006 | 2005(1) | |
Per-Share Data | |||||
Net Asset Value, Beginning of Period | $11.60 | $12.32 | $11.46 | $11.18 | $10.00 |
Income From Investment Operations | |||||
Net Investment Income (Loss)(2) | 0.16 | 0.36 | 0.22 | 0.19 | 0.15 |
Net Realized and Unrealized Gain (Loss) | (1.62) | (0.70) | 1.34 | 0.36 | 1.15 |
Total From Investment Operations | (1.46) | (0.34) | 1.56 | 0.55 | 1.30 |
Distributions | |||||
From Net Investment Income | (0.25) | (0.33) | (0.18) | (0.25) | (0.12) |
From Net Realized Gains | (0.16) | (0.05) | (0.52) | (0.02) | — |
Total Distributions | (0.41) | (0.38) | (0.70) | (0.27) | (0.12) |
Net Asset Value, End of Period | $9.73 | $11.60 | $12.32 | $11.46 | $11.18 |
Total Return(3) | (12.12)% | (2.90)% | 13.90% | 4.95% | 13.10% |
Ratios/Supplemental Data | |||||
Ratio of Operating Expenses | |||||
to Average Net Assets(4) | 0.70% | 0.70% | 0.70% | 0.70% | 0.70%(5) |
Ratio of Net Investment Income (Loss) | |||||
to Average Net Assets | 1.93% | 2.90% | 1.84% | 2.48% | 1.58%(5) |
Portfolio Turnover Rate | 22% | 18% | 18% | 120% | 2% |
Net Assets, End of Period (in thousands) | $16,344 | $2,746 | $1,378 | $545 | $65 |
(1) | August 31, 2004 (fund inception) through July 31, 2005. |
(2) | Computed using average shares outstanding throughout the period. |
(3) | Total return assumes reinvestment of net investment income and capital gains distributions, if any. Total returns for periods less than one year are not annualized. The total return of the classes may not precisely reflect the class expense differences because of the impact of calculating the net asset values to two decimal places. If net asset values were calculated to three decimal places, the total return differences would more closely reflect the class expense differences. The calculation of net asset values to two decimal places is made in accordance with SEC guidelines and does not result in any gain or loss of value between one class and another. |
(4) | Ratio of operating expenses to average net assets does not include any expenses of the underlying funds. |
(5) | Annualized. |
See Notes to Financial Statements.
77
LIVESTRONG 2030 Portfolio | ||
Investor Class | ||
For a Share Outstanding Throughout the Years Ended July 31 (except as noted) | ||
2009 | 2008(1) | |
Per-Share Data | ||
Net Asset Value, Beginning of Period | $9.39 | $10.00 |
Income From Investment Operations | ||
Net Investment Income (Loss)(2) | 0.10 | 0.02 |
Net Realized and Unrealized Gain (Loss) | (1.36) | (0.63) |
Total From Investment Operations | (1.26) | (0.61) |
Distributions | ||
From Net Investment Income | (0.09) | — |
Net Asset Value, End of Period | $8.04 | $9.39 |
Total Return(3) | (13.30)% | (6.10)% |
Ratios/Supplemental Data | ||
Ratio of Operating Expenses to Average Net Assets(4) | 0.20% | 0.20%(5) |
Ratio of Net Investment Income (Loss) to Average Net Assets | 1.48% | 1.49%(5) |
Portfolio Turnover Rate | 43% | 4% |
Net Assets, End of Period (in thousands) | $70,382 | $626 |
(1) | May 30, 2008 (fund inception) through July 31, 2008. |
(2) | Computed using average shares outstanding throughout the period. |
(3) | Total return assumes reinvestment of net investment income and capital gains distributions, if any. Total returns for periods less than one year are not annualized. The total return of the classes may not precisely reflect the class expense differences because of the impact of calculating the net asset values to two decimal places. If net asset values were calculated to three decimal places, the total return differences would more closely reflect the class expense differences. The calculation of net asset values to two decimal places is made in accordance with SEC guidelines and does not result in any gain or loss of value between one class and another. |
(4) | Ratio of operating expenses to average net assets does not include any expenses of the underlying funds. |
(5) | Annualized. |
See Notes to Financial Statements.
78
LIVESTRONG 2030 Portfolio | ||
Institutional Class | ||
For a Share Outstanding Throughout the Years Ended July 31 (except as noted) | ||
2009 | 2008(1) | |
Per-Share Data | ||
Net Asset Value, Beginning of Period | $9.40 | $10.00 |
Income From Investment Operations | ||
Net Investment Income (Loss)(2) | 0.12 | 0.04 |
Net Realized and Unrealized Gain (Loss) | (1.37) | (0.64) |
Total From Investment Operations | (1.25) | (0.60) |
Distributions | ||
From Net Investment Income | (0.10) | — |
Net Asset Value, End of Period | $8.05 | $9.40 |
Total Return(3) | (13.18)% | (6.00)% |
Ratios/Supplemental Data | ||
Ratio of Operating Expenses to Average Net Assets(4) | 0.00% | 0.00%(5) |
Ratio of Net Investment Income (Loss) to Average Net Assets | 1.68% | 1.69%(5) |
Portfolio Turnover Rate | 43% | 4% |
Net Assets, End of Period (in thousands) | $17,528 | $6 |
(1) | May 30, 2008 (fund inception) through July 31, 2008. |
(2) | Computed using average shares outstanding throughout the period. |
(3) | Total return assumes reinvestment of net investment income and capital gains distributions, if any. Total returns for periods less than one year are not annualized. The total return of the classes may not precisely reflect the class expense differences because of the impact of calculating the net asset values to two decimal places. If net asset values were calculated to three decimal places, the total return differences would more closely reflect the class expense differences. The calculation of net asset values to two decimal places is made in accordance with SEC guidelines and does not result in any gain or loss of value between one class and another. |
(4) | Ratio of operating expenses to average net assets does not include any expenses of the underlying funds. Other expenses, which include the fees and expenses of the fund’s independent directors and its legal counsel, as well as interest, did not exceed 0.005%. |
(5) | Annualized. |
See Notes to Financial Statements.
79
LIVESTRONG 2030 Portfolio | ||
Advisor Class | ||
For a Share Outstanding Throughout the Years Ended July 31 (except as noted) | ||
2009 | 2008(1) | |
Per-Share Data | ||
Net Asset Value, Beginning of Period | $9.39 | $10.00 |
Income From Investment Operations | ||
Net Investment Income (Loss)(2) | 0.11 | 0.03 |
Net Realized and Unrealized Gain (Loss) | (1.39) | (0.64) |
Total From Investment Operations | (1.28) | (0.61) |
Distributions | ||
From Net Investment Income | (0.08) | — |
Net Asset Value, End of Period | $8.03 | $9.39 |
Total Return(3) | (13.53)% | (6.10)% |
Ratios/Supplemental Data | ||
Ratio of Operating Expenses to Average Net Assets(4) | 0.45% | 0.45%(5) |
Ratio of Net Investment Income (Loss) to Average Net Assets | 1.23% | 1.24%(5) |
Portfolio Turnover Rate | 43% | 4% |
Net Assets, End of Period (in thousands) | $3,378 | $6 |
(1) | May 30, 2008 (fund inception) through July 31, 2008. |
(2) | Computed using average shares outstanding throughout the period. |
(3) | Total return assumes reinvestment of net investment income and capital gains distributions, if any. Total returns for periods less than one year are not annualized. The total return of the classes may not precisely reflect the class expense differences because of the impact of calculating the net asset values to two decimal places. If net asset values were calculated to three decimal places, the total return differences would more closely reflect the class expense differences. The calculation of net asset values to two decimal places is made in accordance with SEC guidelines and does not result in any gain or loss of value between one class and another. |
(4) | Ratio of operating expenses to average net assets does not include any expenses of the underlying funds. |
(5) | Annualized. |
See Notes to Financial Statements.
80
LIVESTRONG 2030 Portfolio | ||
R Class | ||
For a Share Outstanding Throughout the Years Ended July 31 (except as noted) | ||
2009 | 2008(1) | |
Per-Share Data | ||
Net Asset Value, Beginning of Period | $9.39 | $10.00 |
Income From Investment Operations | ||
Net Investment Income (Loss)(2) | 0.12 | 0.02 |
Net Realized and Unrealized Gain (Loss) | (1.42) | (0.63) |
Total From Investment Operations | (1.30) | (0.61) |
Distributions | ||
From Net Investment Income | (0.07) | — |
Net Asset Value, End of Period | $8.02 | $9.39 |
Total Return(3) | (13.76)% | (6.10)% |
Ratios/Supplemental Data | ||
Ratio of Operating Expenses to Average Net Assets(4) | 0.70% | 0.70%(5) |
Ratio of Net Investment Income (Loss) to Average Net Assets | 0.98% | 0.99%(5) |
Portfolio Turnover Rate | 43% | 4% |
Net Assets, End of Period (in thousands) | $3,573 | $6 |
(1) | May 30, 2008 (fund inception) through July 31, 2008. |
(2) | Computed using average shares outstanding throughout the period. |
(3) | Total return assumes reinvestment of net investment income and capital gains distributions, if any. Total returns for periods less than one year are not annualized. The total return of the classes may not precisely reflect the class expense differences because of the impact of calculating the net asset values to two decimal places. If net asset values were calculated to three decimal places, the total return differences would more closely reflect the class expense differences. The calculation of net asset values to two decimal places is made in accordance with SEC guidelines and does not result in any gain or loss of value between one class and another. |
(4) | Ratio of operating expenses to average net assets does not include any expenses of the underlying funds. |
(5) | Annualized. |
See Notes to Financial Statements.
81
LIVESTRONG 2035 Portfolio | |||||
Investor Class | |||||
For a Share Outstanding Throughout the Years Ended July 31 (except as noted) | |||||
2009 | 2008 | 2007 | 2006 | 2005(1) | |
Per-Share Data | |||||
Net Asset Value, Beginning of Period | $12.10 | $13.09 | $11.85 | $11.43 | $10.00 |
Income From Investment Operations | |||||
Net Investment Income (Loss)(2) | 0.19 | 0.41 | 0.24 | 0.31 | 0.17 |
Net Realized and Unrealized Gain (Loss) | (2.13) | (0.95) | 1.71 | 0.42 | 1.39 |
Total From Investment Operations | (1.94) | (0.54) | 1.95 | 0.73 | 1.56 |
Distributions | |||||
From Net Investment Income | (0.24) | (0.40) | (0.19) | (0.30) | (0.13) |
From Net Realized Gains | (0.18) | (0.05) | (0.52) | (0.01) | — |
Total Distributions | (0.42) | (0.45) | (0.71) | (0.31) | (0.13) |
Net Asset Value, End of Period | $9.74 | $12.10 | $13.09 | $11.85 | $11.43 |
Total Return(3) | (15.54)% | (4.33)% | 16.86% | 6.45% | 15.71% |
Ratios/Supplemental Data | |||||
Ratio of Operating Expenses | |||||
to Average Net Assets(4) | 0.20% | 0.20% | 0.20% | 0.20% | 0.20%(5) |
Ratio of Net Investment Income (Loss) | |||||
to Average Net Assets | 2.12% | 3.19% | 1.87% | 2.61% | 1.62%(5) |
Portfolio Turnover Rate | 18% | 16% | 23% | 141% | 3% |
Net Assets, End of Period (in thousands) | $170,455 | $128,815 | $91,220 | $52,206 | $21,537 |
(1) | August 31, 2004 (fund inception) through July 31, 2005. |
(2) | Computed using average shares outstanding throughout the period. |
(3) | Total return assumes reinvestment of net investment income and capital gains distributions, if any. Total returns for periods less than one year are not annualized. The total return of the classes may not precisely reflect the class expense differences because of the impact of calculating the net asset values to two decimal places. If net asset values were calculated to three decimal places, the total return differences would more closely reflect the class expense differences. The calculation of net asset values to two decimal places is made in accordance with SEC guidelines and does not result in any gain or loss of value between one class and another. |
(4) | Ratio of operating expenses to average net assets does not include any expenses of the underlying funds. |
(5) | Annualized. |
See Notes to Financial Statements.
82
LIVESTRONG 2035 Portfolio | |||||
Institutional Class | |||||
For a Share Outstanding Throughout the Years Ended July 31 (except as noted) | |||||
2009 | 2008 | 2007 | 2006 | 2005(1) | |
Per-Share Data | |||||
Net Asset Value, Beginning of Period | $12.12 | $13.11 | $11.87 | $11.45 | $10.00 |
Income From Investment Operations | |||||
Net Investment Income (Loss)(2) | 0.20 | 0.44 | 0.26 | 0.30 | 0.16 |
Net Realized and Unrealized Gain (Loss) | (2.12) | (0.95) | 1.72 | 0.45 | 1.43 |
Total From Investment Operations | (1.92) | (0.51) | 1.98 | 0.75 | 1.59 |
Distributions | |||||
From Net Investment Income | (0.26) | (0.43) | (0.22) | (0.32) | (0.14) |
From Net Realized Gains | (0.18) | (0.05) | (0.52) | (0.01) | — |
Total Distributions | (0.44) | (0.48) | (0.74) | (0.33) | (0.14) |
Net Asset Value, End of Period | $9.76 | $12.12 | $13.11 | $11.87 | $11.45 |
Total Return(3) | (15.34)% | (4.13)% | 17.07% | 6.66% | 15.98% |
Ratios/Supplemental Data | |||||
Ratio of Operating Expenses | |||||
to Average Net Assets(4) | 0.00% | 0.00% | 0.00% | 0.00% | 0.00%(5) |
Ratio of Net Investment Income (Loss) | |||||
to Average Net Assets | 2.32% | 3.39% | 2.07% | 2.81% | 1.82%(5) |
Portfolio Turnover Rate | 18% | 16% | 23% | 141% | 3% |
Net Assets, End of Period (in thousands) | $46,544 | $24,120 | $22,314 | $11,104 | $3,435 |
(1) | August 31, 2004 (fund inception) through July 31, 2005. |
(2) | Computed using average shares outstanding throughout the period. |
(3) | Total return assumes reinvestment of net investment income and capital gains distributions, if any. Total returns for periods less than one year are not annualized. The total return of the classes may not precisely reflect the class expense differences because of the impact of calculating the net asset values to two decimal places. If net asset values were calculated to three decimal places, the total return differences would more closely reflect the class expense differences. The calculation of net asset values to two decimal places is made in accordance with SEC guidelines and does not result in any gain or loss of value between one class and another. |
(4) | Ratio of operating expenses to average net assets does not include any expenses of the underlying funds. Other expenses, which include the fees and expenses of the fund’s independent directors and its legal counsel, as well as interest, did not exceed 0.005%. |
(5) | Annualized. |
See Notes to Financial Statements.
83
LIVESTRONG 2035 Portfolio | |||||
Advisor Class | |||||
For a Share Outstanding Throughout the Years Ended July 31 (except as noted) | |||||
2009 | 2008 | 2007 | 2006 | 2005(1) | |
Per-Share Data | |||||
Net Asset Value, Beginning of Period | $12.09 | $13.08 | $11.83 | $11.42 | $10.00 |
Income From Investment Operations | |||||
Net Investment Income (Loss)(2) | 0.17 | 0.35 | 0.21 | 0.26 | 0.11 |
Net Realized and Unrealized Gain (Loss) | (2.13) | (0.92) | 1.72 | 0.43 | 1.44 |
Total From Investment Operations | (1.96) | (0.57) | 1.93 | 0.69 | 1.55 |
Distributions | |||||
From Net Investment Income | (0.22) | (0.37) | (0.16) | (0.27) | (0.13) |
From Net Realized Gains | (0.18) | (0.05) | (0.52) | (0.01) | — |
Total Distributions | (0.40) | (0.42) | (0.68) | (0.28) | (0.13) |
Net Asset Value, End of Period | $9.73 | $12.09 | $13.08 | $11.83 | $11.42 |
Total Return(3) | (15.77)% | (4.58)% | 16.67% | 6.10% | 15.53% |
Ratios/Supplemental Data | |||||
Ratio of Operating Expenses | |||||
to Average Net Assets(4) | 0.45% | 0.45% | 0.45% | 0.45% | 0.45%(5) |
Ratio of Net Investment Income (Loss) | |||||
to Average Net Assets | 1.87% | 2.94% | 1.62% | 2.36% | 1.37%(5) |
Portfolio Turnover Rate | 18% | 16% | 23% | 141% | 3% |
Net Assets, End of Period (in thousands) | $32,896 | $19,145 | $13,378 | $5,224 | $113 |
(1) | August 31, 2004 (fund inception) through July 31, 2005. |
(2) | Computed using average shares outstanding throughout the period. |
(3) | Total return assumes reinvestment of net investment income and capital gains distributions, if any. Total returns for periods less than one year are not annualized. The total return of the classes may not precisely reflect the class expense differences because of the impact of calculating the net asset values to two decimal places. If net asset values were calculated to three decimal places, the total return differences would more closely reflect the class expense differences. The calculation of net asset values to two decimal places is made in accordance with SEC guidelines and does not result in any gain or loss of value between one class and another. |
(4) | Ratio of operating expenses to average net assets does not include any expenses of the underlying funds. |
(5) | Annualized. |
See Notes to Financial Statements.
84
LIVESTRONG 2035 Portfolio | |||||
R Class | |||||
For a Share Outstanding Throughout the Years Ended July 31 (except as noted) | |||||
2009 | 2008 | 2007 | 2006 | 2005(1) | |
Per-Share Data | |||||
Net Asset Value, Beginning of Period | $12.07 | $13.06 | $11.82 | $11.40 | $10.00 |
Income From Investment Operations | |||||
Net Investment Income (Loss)(2) | 0.14 | 0.43 | 0.18 | 0.16 | 0.22 |
Net Realized and Unrealized Gain (Loss) | (2.11) | (1.03) | 1.71 | 0.51 | 1.30 |
Total From Investment Operations | (1.97) | (0.60) | 1.89 | 0.67 | 1.52 |
Distributions | |||||
From Net Investment Income | (0.20) | (0.34) | (0.13) | (0.24) | (0.12) |
From Net Realized Gains | (0.18) | (0.05) | (0.52) | (0.01) | — |
Total Distributions | (0.38) | (0.39) | (0.65) | (0.25) | (0.12) |
Net Asset Value, End of Period | $9.72 | $12.07 | $13.06 | $11.82 | $11.40 |
Total Return(3) | (15.92)% | (4.84)% | 16.30% | 5.93% | 15.24% |
Ratios/Supplemental Data | |||||
Ratio of Operating Expenses | |||||
to Average Net Assets(4) | 0.70% | 0.70% | 0.70% | 0.70% | 0.70%(5) |
Ratio of Net Investment Income (Loss) | |||||
to Average Net Assets | 1.62% | 2.69% | 1.37% | 2.11% | 1.12%(5) |
Portfolio Turnover Rate | 18% | 16% | 23% | 141% | 3% |
Net Assets, End of Period (in thousands) | $10,785 | $2,178 | $975 | $296 | $6 |
(1) | August 31, 2004 (fund inception) through July 31, 2005. |
(2) | Computed using average shares outstanding throughout the period. |
(3) | Total return assumes reinvestment of net investment income and capital gains distributions, if any. Total returns for periods less than one year are not annualized. The total return of the classes may not precisely reflect the class expense differences because of the impact of calculating the net asset values to two decimal places. If net asset values were calculated to three decimal places, the total return differences would more closely reflect the class expense differences. The calculation of net asset values to two decimal places is made in accordance with SEC guidelines and does not result in any gain or loss of value between one class and another. |
(4) | Ratio of operating expenses to average net assets does not include any expenses of the underlying funds. |
(5) | Annualized. |
See Notes to Financial Statements.
85
LIVESTRONG 2040 Portfolio | ||
Investor Class | ||
For a Share Outstanding Throughout the Years Ended July 31 (except as noted) | ||
2009 | 2008(1) | |
Per-Share Data | ||
Net Asset Value, Beginning of Period | $9.29 | $10.00 |
Income From Investment Operations | ||
Net Investment Income (Loss)(2) | 0.09 | 0.01 |
Net Realized and Unrealized Gain (Loss) | (1.54) | (0.72) |
Total From Investment Operations | (1.45) | (0.71) |
Distributions | ||
From Net Investment Income | (0.09) | — |
Net Asset Value, End of Period | $7.75 | $9.29 |
Total Return(3) | (15.53)% | (7.10)% |
Ratios/Supplemental Data | ||
Ratio of Operating Expenses to Average Net Assets(4) | 0.20% | 0.20%(5) |
Ratio of Net Investment Income (Loss) to Average Net Assets | 1.38% | 1.10%(5) |
Portfolio Turnover Rate | 25% | 3% |
Net Assets, End of Period (in thousands) | $24,386 | $831 |
(1) | May 30, 2008 (fund inception) through July 31, 2008. |
(2) | Computed using average shares outstanding throughout the period. |
(3) | Total return assumes reinvestment of net investment income and capital gains distributions, if any. Total returns for periods less than one year are not annualized. The total return of the classes may not precisely reflect the class expense differences because of the impact of calculating the net asset values to two decimal places. If net asset values were calculated to three decimal places, the total return differences would more closely reflect the class expense differences. The calculation of net asset values to two decimal places is made in accordance with SEC guidelines and does not result in any gain or loss of value between one class and another. |
(4) | Ratio of operating expenses to average net assets does not include any expenses of the underlying funds. |
(5) | Annualized. |
See Notes to Financial Statements.
86
LIVESTRONG 2040 Portfolio | ||
Institutional Class | ||
For a Share Outstanding Throughout the Years Ended July 31 (except as noted) | ||
2009 | 2008(1) | |
Per-Share Data | ||
Net Asset Value, Beginning of Period | $9.29 | $10.00 |
Income From Investment Operations | ||
Net Investment Income (Loss)(2) | 0.11 | 0.03 |
Net Realized and Unrealized Gain (Loss) | (1.56) | (0.74) |
Total From Investment Operations | (1.45) | (0.71) |
Distributions | ||
From Net Investment Income | (0.09) | — |
Net Asset Value, End of Period | $7.75 | $9.29 |
Total Return(3) | (15.43)% | (7.10)% |
Ratios/Supplemental Data | ||
Ratio of Operating Expenses to Average Net Assets(4) | 0.00% | 0.00%(5) |
Ratio of Net Investment Income (Loss) to Average Net Assets | 1.58% | 1.30%(5) |
Portfolio Turnover Rate | 25% | 3% |
Net Assets, End of Period (in thousands) | $9,846 | $6 |
(1) | May 30, 2008 (fund inception) through July 31, 2008. |
(2) | Computed using average shares outstanding throughout the period. |
(3) | Total return assumes reinvestment of net investment income and capital gains distributions, if any. Total returns for periods less than one year are not annualized. The total return of the classes may not precisely reflect the class expense differences because of the impact of calculating the net asset values to two decimal places. If net asset values were calculated to three decimal places, the total return differences would more closely reflect the class expense differences. The calculation of net asset values to two decimal places is made in accordance with SEC guidelines and does not result in any gain or loss of value between one class and another. |
(4) | Ratio of operating expenses to average net assets does not include any expenses of the underlying funds. Other expenses, which include the fees and expenses of the fund’s independent directors and its legal counsel, as well as interest, did not exceed 0.005%. |
(5) | Annualized. |
See Notes to Financial Statements.
87
LIVESTRONG 2040 Portfolio | ||
Advisor Class | ||
For a Share Outstanding Throughout the Years Ended July 31 (except as noted) | ||
2009 | 2008(1) | |
Per-Share Data | ||
Net Asset Value, Beginning of Period | $9.29 | $10.00 |
Income From Investment Operations | ||
Net Investment Income (Loss)(2) | 0.09 | 0.02 |
Net Realized and Unrealized Gain (Loss) | (1.57) | (0.73) |
Total From Investment Operations | (1.48) | (0.71) |
Distributions | ||
From Net Investment Income | (0.08) | — |
Net Asset Value, End of Period | $7.73 | $9.29 |
Total Return(3) | (15.87)% | (7.10)% |
Ratios/Supplemental Data | ||
Ratio of Operating Expenses to Average Net Assets(4) | 0.45% | 0.45%(5) |
Ratio of Net Investment Income (Loss) to Average Net Assets | 1.13% | 0.85%(5) |
Portfolio Turnover Rate | 25% | 3% |
Net Assets, End of Period (in thousands) | $1,551 | $6 |
(1) | May 30, 2008 (fund inception) through July 31, 2008. |
(2) | Computed using average shares outstanding throughout the period. |
(3) | Total return assumes reinvestment of net investment income and capital gains distributions, if any. Total returns for periods less than one year are not annualized. The total return of the classes may not precisely reflect the class expense differences because of the impact of calculating the net asset values to two decimal places. If net asset values were calculated to three decimal places, the total return differences would more closely reflect the class expense differences. The calculation of net asset values to two decimal places is made in accordance with SEC guidelines and does not result in any gain or loss of value between one class and another. |
(4) | Ratio of operating expenses to average net assets does not include any expenses of the underlying funds. |
(5) | Annualized. |
See Notes to Financial Statements.
88
LIVESTRONG 2040 Portfolio | ||
R Class | ||
For a Share Outstanding Throughout the Years Ended July 31 (except as noted) | ||
2009 | 2008(1) | |
Per-Share Data | ||
Net Asset Value, Beginning of Period | $9.28 | $10.00 |
Income From Investment Operations | ||
Net Investment Income (Loss)(2) | 0.10 | 0.02 |
Net Realized and Unrealized Gain (Loss) | (1.59) | (0.74) |
Total From Investment Operations | (1.49) | (0.72) |
Distributions | ||
From Net Investment Income | (0.07) | — |
Net Asset Value, End of Period | $7.72 | $9.28 |
Total Return(3) | (16.01)% | (7.20)% |
Ratios/Supplemental Data | ||
Ratio of Operating Expenses to Average Net Assets(4) | 0.70% | 0.70%(5) |
Ratio of Net Investment Income (Loss) to Average Net Assets | 0.88% | 0.60%(5) |
Portfolio Turnover Rate | 25% | 3% |
Net Assets, End of Period (in thousands) | $2,347 | $6 |
(1) | May 30, 2008 (fund inception) through July 31, 2008. |
(2) | Computed using average shares outstanding throughout the period. |
(3) | Total return assumes reinvestment of net investment income and capital gains distributions, if any. Total returns for periods less than one year are not annualized. The total return of the classes may not precisely reflect the class expense differences because of the impact of calculating the net asset values to two decimal places. If net asset values were calculated to three decimal places, the total return differences would more closely reflect the class expense differences. The calculation of net asset values to two decimal places is made in accordance with SEC guidelines and does not result in any gain or loss of value between one class and another. |
(4) | Ratio of operating expenses to average net assets does not include any expenses of the underlying funds. |
(5) | Annualized. |
See Notes to Financial Statements.
89
LIVESTRONG 2045 Portfolio | |||||
Investor Class | |||||
For a Share Outstanding Throughout the Years Ended July 31 (except as noted) | |||||
2009 | 2008 | 2007 | 2006 | 2005(1) | |
Per-Share Data | |||||
Net Asset Value, Beginning of Period | $12.24 | $13.40 | $11.96 | $11.54 | $10.00 |
Income From Investment Operations | |||||
Net Investment Income (Loss)(2) | 0.18 | 0.42 | 0.22 | 0.31 | 0.12 |
Net Realized and Unrealized Gain (Loss) | (2.41) | (1.12) | 1.92 | 0.46 | 1.56 |
Total From Investment Operations | (2.23) | (0.70) | 2.14 | 0.77 | 1.68 |
Distributions | |||||
From Net Investment Income | (0.22) | (0.41) | (0.17) | (0.32) | (0.14) |
From Net Realized Gains | (0.20) | (0.05) | (0.53) | (0.03) | — |
Total Distributions | (0.42) | (0.46) | (0.70) | (0.35) | (0.14) |
Net Asset Value, End of Period | $9.59 | $12.24 | $13.40 | $11.96 | $11.54 |
Total Return(3) | (17.74)% | (5.53)% | 18.23% | 6.76% | 16.86% |
Ratios/Supplemental Data | |||||
Ratio of Operating Expenses | |||||
to Average Net Assets(4) | 0.20% | 0.20% | 0.20% | 0.20% | 0.20%(5) |
Ratio of Net Investment Income (Loss) | |||||
to Average Net Assets | 1.99% | 3.19% | 1.62% | 2.62% | 1.83%(5) |
Portfolio Turnover Rate | 18% | 18% | 25% | 137% | 17% |
Net Assets, End of Period (in thousands) | $85,095 | $72,649 | $48,229 | $22,437 | $7,465 |
(1) | August 31, 2004 (fund inception) through July 31, 2005. |
(2) | Computed using average shares outstanding throughout the period. |
(3) | Total return assumes reinvestment of net investment income and capital gains distributions, if any. Total returns for periods less than one year are not annualized. The total return of the classes may not precisely reflect the class expense differences because of the impact of calculating the net asset values to two decimal places. If net asset values were calculated to three decimal places, the total return differences would more closely reflect the class expense differences. The calculation of net asset values to two decimal places is made in accordance with SEC guidelines and does not result in any gain or loss of value between one class and another. |
(4) | Ratio of operating expenses to average net assets does not include any expenses of the underlying funds. |
(5) | Annualized. |
See Notes to Financial Statements.
90
LIVESTRONG 2045 Portfolio | |||||
Institutional Class | |||||
For a Share Outstanding Throughout the Years Ended July 31 (except as noted) | |||||
2009 | 2008 | 2007 | 2006 | 2005(1) | |
Per-Share Data | |||||
Net Asset Value, Beginning of Period | $12.25 | $13.42 | $11.98 | $11.56 | $10.00 |
Income From Investment Operations | |||||
Net Investment Income (Loss)(2) | 0.20 | 0.44 | 0.23 | 0.35 | 0.25 |
Net Realized and Unrealized Gain (Loss) | (2.41) | (1.12) | 1.93 | 0.44 | 1.45 |
Total From Investment Operations | (2.21) | (0.68) | 2.16 | 0.79 | 1.70 |
Distributions | |||||
From Net Investment Income | (0.24) | (0.44) | (0.19) | (0.34) | (0.14) |
From Net Realized Gains | (0.20) | (0.05) | (0.53) | (0.03) | — |
Total Distributions | (0.44) | (0.49) | (0.72) | (0.37) | (0.14) |
Net Asset Value, End of Period | $9.60 | $12.25 | $13.42 | $11.98 | $11.56 |
Total Return(3) | (17.56)% | (5.40)% | 18.44% | 6.96% | 17.11% |
Ratios/Supplemental Data | |||||
Ratio of Operating Expenses | |||||
to Average Net Assets(4) | 0.00% | 0.00% | 0.00% | 0.00% | 0.00%(5) |
Ratio of Net Investment Income (Loss) | |||||
to Average Net Assets | 2.19% | 3.39% | 1.82% | 2.82% | 2.03%(5) |
Portfolio Turnover Rate | 18% | 18% | 25% | 137% | 17% |
Net Assets, End of Period (in thousands) | $34,639 | $31,054 | $28,483 | $13,397 | $7,181 |
(1) | August 31, 2004 (fund inception) through July 31, 2005. |
(2) | Computed using average shares outstanding throughout the period. |
(3) | Total return assumes reinvestment of net investment income and capital gains distributions, if any. Total returns for periods less than one year are not annualized. The total return of the classes may not precisely reflect the class expense differences because of the impact of calculating the net asset values to two decimal places. If net asset values were calculated to three decimal places, the total return differences would more closely reflect the class expense differences. The calculation of net asset values to two decimal places is made in accordance with SEC guidelines and does not result in any gain or loss of value between one class and another. |
(4) | Ratio of operating expenses to average net assets does not include any expenses of the underlying funds. Other expenses, which include the fees and expenses of the fund’s independent directors and its legal counsel, as well as interest, did not exceed 0.005%. |
(5) | Annualized. |
See Notes to Financial Statements.
91
LIVESTRONG 2045 Portfolio | |||||
Advisor Class | |||||
For a Share Outstanding Throughout the Years Ended July 31 (except as noted) | |||||
2009 | 2008 | 2007 | 2006 | 2005(1) | |
Per-Share Data | |||||
Net Asset Value, Beginning of Period | $12.22 | $13.38 | $11.94 | $11.53 | $10.00 |
Income From Investment Operations | |||||
Net Investment Income (Loss)(2) | 0.15 | 0.39 | 0.18 | 0.20 | 0.07 |
Net Realized and Unrealized Gain (Loss) | (2.40) | (1.13) | 1.92 | 0.53 | 1.59 |
Total From Investment Operations | (2.25) | (0.74) | 2.10 | 0.73 | 1.66 |
Distributions | |||||
From Net Investment Income | (0.20) | (0.37) | (0.13) | (0.29) | (0.13) |
From Net Realized Gains | (0.20) | (0.05) | (0.53) | (0.03) | — |
Total Distributions | (0.40) | (0.42) | (0.66) | (0.32) | (0.13) |
Net Asset Value, End of Period | $9.57 | $12.22 | $13.38 | $11.94 | $11.53 |
Total Return(3) | (17.98)% | (5.78)% | 17.96% | 6.51% | 16.57% |
Ratios/Supplemental Data | |||||
Ratio of Operating Expenses | |||||
to Average Net Assets(4) | 0.45% | 0.45% | 0.45% | 0.45% | 0.45%(5) |
Ratio of Net Investment Income (Loss) | |||||
to Average Net Assets | 1.74% | 2.94% | 1.37% | 2.37% | 1.58%(5) |
Portfolio Turnover Rate | 18% | 18% | 25% | 137% | 17% |
Net Assets, End of Period (in thousands) | $17,537 | $11,411 | $9,091 | $4,177 | $380 |
(1) | August 31, 2004 (fund inception) through July 31, 2005. |
(2) | Computed using average shares outstanding throughout the period. |
(3) | Total return assumes reinvestment of net investment income and capital gains distributions, if any. Total returns for periods less than one year are not annualized. The total return of the classes may not precisely reflect the class expense differences because of the impact of calculating the net asset values to two decimal places. If net asset values were calculated to three decimal places, the total return differences would more closely reflect the class expense differences. The calculation of net asset values to two decimal places is made in accordance with SEC guidelines and does not result in any gain or loss of value between one class and another. |
(4) | Ratio of operating expenses to average net assets does not include any expenses of the underlying funds. |
(5) | Annualized. |
See Notes to Financial Statements.
92
LIVESTRONG 2045 Portfolio | |||||
R Class | |||||
For a Share Outstanding Throughout the Years Ended July 31 (except as noted) | |||||
2009 | 2008 | 2007 | 2006 | 2005(1) | |
Per-Share Data | |||||
Net Asset Value, Beginning of Period | $12.21 | $13.36 | $11.93 | $11.51 | $10.00 |
Income From Investment Operations | |||||
Net Investment Income (Loss)(2) | 0.11 | 0.38 | 0.12 | 0.12 | 0.18 |
Net Realized and Unrealized Gain (Loss) | (2.38) | (1.14) | 1.94 | 0.59 | 1.45 |
Total From Investment Operations | (2.27) | (0.76) | 2.06 | 0.71 | 1.63 |
Distributions | |||||
From Net Investment Income | (0.18) | (0.34) | (0.10) | (0.26) | (0.12) |
From Net Realized Gains | (0.20) | (0.05) | (0.53) | (0.03) | — |
Total Distributions | (0.38) | (0.39) | (0.63) | (0.29) | (0.12) |
Net Asset Value, End of Period | $9.56 | $12.21 | $13.36 | $11.93 | $11.51 |
Total Return(3) | (18.20)% | (5.96)% | 17.58% | 6.24% | 16.38% |
Ratios/Supplemental Data | |||||
Ratio of Operating Expenses | |||||
to Average Net Assets(4) | 0.70% | 0.70% | 0.70% | 0.70% | 0.70%(5) |
Ratio of Net Investment Income (Loss) | |||||
to Average Net Assets | 1.49% | 2.69% | 1.12% | 2.12% | 1.33%(5) |
Portfolio Turnover Rate | 18% | 18% | 25% | 137% | 17% |
Net Assets, End of Period (in thousands) | $4,966 | $1,403 | $753 | $165 | $6 |
(1) | August 31, 2004 (fund inception) through July 31, 2005. |
(2) | Computed using average shares outstanding throughout the period. |
(3) | Total return assumes reinvestment of net investment income and capital gains distributions, if any. Total returns for periods less than one year are not annualized. The total return of the classes may not precisely reflect the class expense differences because of the impact of calculating the net asset values to two decimal places. If net asset values were calculated to three decimal places, the total return differences would more closely reflect the class expense differences. The calculation of net asset values to two decimal places is made in accordance with SEC guidelines and does not result in any gain or loss of value between one class and another. |
(4) | Ratio of operating expenses to average net assets does not include any expenses of the underlying funds. |
(5) | Annualized. |
See Notes to Financial Statements.
93
LIVESTRONG 2050 Portfolio | ||
Investor Class | ||
For a Share Outstanding Throughout the Years Ended July 31 (except as noted) | ||
2009 | 2008(1) | |
Per-Share Data | ||
Net Asset Value, Beginning of Period | $9.23 | $10.00 |
Income From Investment Operations | ||
Net Investment Income (Loss)(2) | 0.10 | 0.02 |
Net Realized and Unrealized Gain (Loss) | (1.80) | (0.79) |
Total From Investment Operations | (1.70) | (0.77) |
Distributions | ||
From Net Investment Income | (0.07) | — |
Net Asset Value, End of Period | $7.46 | $9.23 |
Total Return(3) | (18.30)% | (7.70)% |
Ratios/Supplemental Data | ||
Ratio of Operating Expenses to Average Net Assets(4) | 0.20% | 0.20%(5) |
Ratio of Net Investment Income (Loss) to Average Net Assets | 1.57% | 1.16%(5) |
Portfolio Turnover Rate | 26% | 3% |
Net Assets, End of Period (in thousands) | $3,454 | $464 |
(1) | May 30, 2008 (fund inception) through July 31, 2008. |
(2) | Computed using average shares outstanding throughout the period. |
(3) | Total return assumes reinvestment of net investment income and capital gains distributions, if any. Total returns for periods less than one year are not annualized. The total return of the classes may not precisely reflect the class expense differences because of the impact of calculating the net asset values to two decimal places. If net asset values were calculated to three decimal places, the total return differences would more closely reflect the class expense differences. The calculation of net asset values to two decimal places is made in accordance with SEC guidelines and does not result in any gain or loss of value between one class and another. |
(4) | Ratio of operating expenses to average net assets does not include any expenses of the underlying funds. |
(5) | Annualized. |
See Notes to Financial Statements.
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LIVESTRONG 2050 Portfolio | ||
Institutional Class | ||
For a Share Outstanding Throughout the Years Ended July 31 (except as noted) | ||
2009 | 2008(1) | |
Per-Share Data | ||
Net Asset Value, Beginning of Period | $9.23 | $10.00 |
Income From Investment Operations | ||
Net Investment Income (Loss)(2) | 0.12 | 0.03 |
Net Realized and Unrealized Gain (Loss) | (1.80) | (0.80) |
Total From Investment Operations | (1.68) | (0.77) |
Distributions | ||
From Net Investment Income | (0.08) | — |
Net Asset Value, End of Period | $7.47 | $9.23 |
Total Return(3) | (18.09)% | (7.70)% |
Ratios/Supplemental Data | ||
Ratio of Operating Expenses to Average Net Assets(4) | 0.00% | 0.00%(5) |
Ratio of Net Investment Income (Loss) to Average Net Assets | 1.77% | 1.36%(5) |
Portfolio Turnover Rate | 26% | 3% |
Net Assets, End of Period (in thousands) | $3,179 | $6 |
(1) | May 30, 2008 (fund inception) through July 31, 2008. |
(2) | Computed using average shares outstanding throughout the period. |
(3) | Total return assumes reinvestment of net investment income and capital gains distributions, if any. Total returns for periods less than one year are not annualized. The total return of the classes may not precisely reflect the class expense differences because of the impact of calculating the net asset values to two decimal places. If net asset values were calculated to three decimal places, the total return differences would more closely reflect the class expense differences. The calculation of net asset values to two decimal places is made in accordance with SEC guidelines and does not result in any gain or loss of value between one class and another. |
(4) | Ratio of operating expenses to average net assets does not include any expenses of the underlying funds. Other expenses, which include the fees and expenses of the fund’s independent directors and its legal counsel, as well as interest, did not exceed 0.005%. |
(5) | Annualized. |
See Notes to Financial Statements.
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LIVESTRONG 2050 Portfolio | ||
Advisor Class | ||
For a Share Outstanding Throughout the Years Ended July 31 (except as noted) | ||
2009 | 2008(1) | |
Per-Share Data | ||
Net Asset Value, Beginning of Period | $9.23 | $10.00 |
Income From Investment Operations | ||
Net Investment Income (Loss)(2) | 0.07 | 0.02 |
Net Realized and Unrealized Gain (Loss) | (1.79) | (0.79) |
Total From Investment Operations | (1.72) | (0.77) |
Distributions | ||
From Net Investment Income | (0.06) | — |
Net Asset Value, End of Period | $7.45 | $9.23 |
Total Return(3) | (18.52)% | (7.70)% |
Ratios/Supplemental Data | ||
Ratio of Operating Expenses to Average Net Assets(4) | 0.45% | 0.45%(5) |
Ratio of Net Investment Income (Loss) to Average Net Assets | 1.32% | 0.91%(5) |
Portfolio Turnover Rate | 26% | 3% |
Net Assets, End of Period (in thousands) | $336 | $6 |
(1) | May 30, 2008 (fund inception) through July 31, 2008. |
(2) | Computed using average shares outstanding throughout the period. |
(3) | Total return assumes reinvestment of net investment income and capital gains distributions, if any. Total returns for periods less than one year are not annualized. The total return of the classes may not precisely reflect the class expense differences because of the impact of calculating the net asset values to two decimal places. If net asset values were calculated to three decimal places, the total return differences would more closely reflect the class expense differences. The calculation of net asset values to two decimal places is made in accordance with SEC guidelines and does not result in any gain or loss of value between one class and another. |
(4) | Ratio of operating expenses to average net assets does not include any expenses of the underlying funds. |
(5) | Annualized. |
See Notes to Financial Statements.
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LIVESTRONG 2050 Portfolio | ||
R Class | ||
For a Share Outstanding Throughout the Years Ended July 31 (except as noted) | ||
2009 | 2008(1) | |
Per-Share Data | ||
Net Asset Value, Beginning of Period | $9.22 | $10.00 |
Income From Investment Operations | ||
Net Investment Income (Loss)(2) | 0.08 | 0.02 |
Net Realized and Unrealized Gain (Loss) | (1.81) | (0.80) |
Total From Investment Operations | (1.73) | (0.78) |
Distributions | ||
From Net Investment Income | (0.05) | — |
Net Asset Value, End of Period | $7.44 | $9.22 |
Total Return(3) | (18.66)% | (7.80)% |
Ratios/Supplemental Data | ||
Ratio of Operating Expenses to Average Net Assets(4) | 0.70% | 0.70%(5) |
Ratio of Net Investment Income (Loss) to Average Net Assets | 1.07% | 0.66%(5) |
Portfolio Turnover Rate | 26% | 3% |
Net Assets, End of Period (in thousands) | $186 | $6 |
(1) | May 30, 2008 (fund inception) through July 31, 2008. |
(2) | Computed using average shares outstanding throughout the period. |
(3) | Total return assumes reinvestment of net investment income and capital gains distributions, if any. Total returns for periods less than one year are not annualized. The total return of the classes may not precisely reflect the class expense differences because of the impact of calculating the net asset values to two decimal places. If net asset values were calculated to three decimal places, the total return differences would more closely reflect the class expense differences. The calculation of net asset values to two decimal places is made in accordance with SEC guidelines and does not result in any gain or loss of value between one class and another. |
(4) | Ratio of operating expenses to average net assets does not include any expenses of the underlying funds. |
(5) | Annualized. |
See Notes to Financial Statements.
97
Report of Independent Registered Public Accounting Firm |
The Board of Directors and Shareholders, American Century Asset Allocation Portfolios, Inc.:
We have audited the accompanying statements of assets and liabilities, including the schedules of investments, of LIVESTRONG Income Portfolio, LIVESTRONG 2015 Portfolio, LIVESTRONG 2025 Portfolio, LIVESTRONG 2035 Portfolio and LIVESTRONG 2045 Portfolio, five of the portfolios constituting American Century Asset Allocation Portfolios, Inc. (the “Corporation”), as of July 31, 2009, 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, and the financial highlights for each of the four years in the period then ended and for the period August 31, 2004 (inception of the portfolios) through July 31, 2005. We have also audited the accompanying statements of assets and liabilities, including the schedules of investments, of LIVESTRONG 2020 Portfolio, LIVESTRONG 2030 Portfolio, LIVESTRONG 2040 Portfolio and LIVESTRONG 2050 Portfolio, four of the portfolios constituting the Corporation, as of July 31, 2009, and the related statements of operations for the year then ended, and the statements of changes in net assets and the financial highlights for the year then ended and for the period May 30, 2008 (inception of the portfolios) through July 31, 2008. These financial statements and financial highlights are the responsibility of the Corporation’s management. Our responsibility is to express an opinion on these financial statements and financial highlights based on our audits.
We conducted our audits in accordance with the standards of the Public Company Accounting Oversight Board (United States). 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. The Corporation is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. Our audits included consideration of internal control over financial reporting as a basis for designing audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Corporation’s internal control over financial reporting. Accordingly, we express no such opinion. An audit also includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements, assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. Our procedures included confirmation of securities owned as of July 31, 2009, by correspondence with the transfer agent. We believe that our audits provide a reasonable basis for our opinion.
In our opinion, the financial statements and financial highlights referred to above present fairly, in all material respects, the respective financial positions of LIVESTRONG Income Portfolio, LIVESTRONG 2015 Portfolio, LIVESTRONG 2020 Portfolio, LIVESTRONG 2025 Portfolio, LIVESTRONG 2030 Portfolio, LIVESTRONG 2035 Portfolio, LIVESTRONG 2040 Portfolio, LIVESTRONG 2045 Portfolio and LIVESTRONG 2050 Portfolio of American Century Asset Allocation Portfolios, Inc. as of July 31, 2009, the results of their operations for the year then ende d, the changes in their net assets for each of the periods presented, and the financial highlights for each of the periods presented, in conformity with accounting principles generally accepted in the United States of America.
Deloitte & Touche LLP
Kansas City, Missouri
September 28, 2009
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Management |
The individuals listed below serve as directors or officers of the funds. Each director serves until his or her successor is duly elected and qualified or until he or she retires. Mandatory retirement age for independent directors is 72. Those listed as interested directors are “interested” primarily by virtue of their engagement as directors and/or officers of, or ownership interest in, American Century Companies, Inc. (ACC) or its wholly owned, direct or indirect, subsidiaries, including the funds’ investment advisor, American Century Investment Management, Inc. (ACIM); the funds’ principal underwriter, American Century Investment Services, Inc. (ACIS); and the funds’ transfer agent, American Century Services, LLC (ACS).
The other directors (more than three-fourths of the total number) are independent; that is, they have never been employees, directors or officers of, and have no financial interest in, ACC or any of its wholly owned, direct or indirect, subsidiaries, including ACIM, ACIS and ACS. The directors serve in this capacity for seven registered investment companies in the American Century Investments family of funds.
All persons named as officers of the funds also serve in similar capacities for the other 14 registered investment companies in the American Century Investments family of funds advised by ACIM or American Century Global Investment Management, Inc. (ACGIM), a wholly owned subsidiary of ACIM, unless otherwise noted. Only officers with policy-making functions are listed. No officer is compensated for his or her service as an officer of the funds. The listed officers are interested persons of the funds and are appointed or re-appointed on an annual basis.
Interested Directors
James E. Stowers, Jr., 4500 Main Street, Kansas City, MO 64111
Year of Birth: 1924
Position(s) Held with Funds: Director (since 1958) and Vice Chairman (since 2007)
Principal Occupation(s) During Past 5 Years: Founder, Co-Chairman, Director and Controlling
Shareholder, ACC; Co-Vice Chairman, ACC (January 2005 to February 2007);
Chairman, ACC (January 1995 to December 2004); Director, ACIM, ACGIM, ACS,
ACIS and other ACC subsidiaries
Number of Portfolios in Fund Complex Overseen by Director: 63
Other Directorships Held by Director: None
Jonathan S. Thomas, 4500 Main Street, Kansas City, MO 64111
Year of Birth: 1963
Position(s) Held with Funds: Director (since 2007) and President (since 2007)
Principal Occupation(s) During Past 5 Years: President and Chief Executive Officer, ACC
(March 2007 to present); Chief Administrative Officer, ACC (February 2006 to
February 2007); Executive Vice President, ACC (November 2005 to February 2007).
Also serves as: President, Chief Executive Officer and Director, ACS; Executive
Vice President, ACIM and ACGIM; Director, ACIM, ACGIM, ACIS and other ACC
subsidiaries. Managing Director, Morgan Stanley (March 2000 to November 2005)
Number of Portfolios in Fund Complex Overseen by Director: 103
Other Directorships Held by Director: None
Independent Directors
Thomas A. Brown, 4500 Main Street, Kansas City, MO 64111
Year of Birth: 1940
Position(s) Held with Funds: Director (since 1980)
Principal Occupation(s) During Past 5 Years: Managing Member, Associated Investments, LLC
(real estate investment company); Managing Member, Brown Cascade Properties,
LLC (real estate investment company); Retired, Area Vice President, Applied
Industrial Technologies (bearings and power transmission company)
Number of Portfolios in Fund Complex Overseen by Director: 63
Other Directorships Held by Director: None
99
Andrea C. Hall, Ph.D., 4500 Main Street, Kansas City, MO 64111
Year of Birth: 1945
Position(s) Held with Funds: Director (since 1997)
Principal Occupation(s) During Past 5 Years: Retired, Advisor to the President, Midwest
Research Institute (not-for-profit, contract research organization)
Number of Portfolios in Fund Complex Overseen by Director: 63
Other Directorships Held by Director: None
James A. Olson, 4500 Main Street, Kansas City, MO 64111
Year of Birth: 1942
Position(s) Held with Funds: Director (since 2007)
Principal Occupation(s) During Past 5 Years: Member, Plaza Belmont LLC (private equity
fund manager); Chief Financial Officer, Plaza Belmont LLC (September 1999 to
September 2006)
Number of Portfolios in Fund Complex Overseen by Director: 63
Other Directorships Held by Director: Saia, Inc. and Entertainment Properties Trust
Donald H. Pratt, 4500 Main Street, Kansas City, MO 64111
Year of Birth: 1937
Position(s) Held with Funds: Director (since 1995) and Chairman of the Board (since 2005)
Principal Occupation(s) During Past 5 Years: Chairman and Chief Executive Officer, Western
Investments, Inc. (real estate company); Retired Chairman of the Board, Butler
Manufacturing Company (metal buildings producer)
Number of Portfolios in Fund Complex Overseen by Director: 63
Other Directorships Held by Director: None
Gale E. Sayers, 4500 Main Street, Kansas City, MO 64111
Year of Birth: 1943
Position(s) Held with Funds: Director (since 2000)
Principal Occupation(s) During Past 5 Years: President, Chief Executive Officer and Founder,
Sayers40, Inc. (technology products and services provider)
Number of Portfolios in Fund Complex Overseen by Director: 63
Other Directorships Held by Director: None
M. Jeannine Strandjord, 4500 Main Street, Kansas City, MO 64111
Year of Birth: 1945
Position(s) Held with Funds: Director (since 1994)
Principal Occupation(s) During Past 5 Years: Retired, formerly Senior Vice President, Sprint
Corporation (telecommunications company)
Number of Portfolios in Fund Complex Overseen by Director: 63
Other Directorships Held by Director: DST Systems, Inc.; Euronet Worldwide, Inc. and
Charming Shoppes, Inc.
John R. Whitten, 4500 Main Street, Kansas City, MO 64111
Year of Birth: 1946
Position(s) Held with Funds: Director (since 2008)
Principal Occupation(s) During Past 5 Years: Project Consultant, Celanese Corp. (industrial
chemical company) (September 2004 to January 2005)
Number of Portfolios in Fund Complex Overseen by Director: 63
Other Directorships Held by Director: Rudolph Technologies, Inc.
Officers
Barry Fink, 4500 Main Street, Kansas City, MO 64111
Year of Birth: 1955
Position(s) Held with Funds: Executive Vice President (since 2007)
Principal Occupation(s) During Past 5 Years: Chief Operating Officer and Executive Vice
President, ACC (September 2007 to present); President, ACS (October 2007 to
present); Managing Director, Morgan Stanley (2000 to 2007); Global General
Counsel, Morgan Stanley (2000 to 2006). Also serves as: Director, ACC, ACS, ACIS
and other ACC subsidiaries
100
Maryanne Roepke, 4500 Main Street, Kansas City, MO 64111
Year of Birth: 1956
Position(s) Held with Funds: Chief Compliance Officer (since 2006) and Senior Vice
President (since 2000)
Principal Occupation(s) During Past 5 Years: Chief Compliance Officer, ACIM, ACGIM
and ACS (August 2006 to present); Assistant Treasurer, ACC (January 1995 to
August 2006); and Treasurer and Chief Financial Officer, various American
Century Investments funds (July 2000 to August 2006). Also serves as: Senior Vice
President, ACS
Charles A. Etherington, 4500 Main Street, Kansas City, MO 64111
Year of Birth: 1957
Position(s) Held with Funds: General Counsel (since 2007) and Senior Vice President
(since 2006)
Principal Occupation(s) During Past 5 Years: Attorney, ACC (February 1994 to present); Vice
President, ACC (November 2005 to present); General Counsel, ACC (March 2007
to present). Also serves as: General Counsel, ACIM, ACGIM, ACS, ACIS and other
ACC subsidiaries; and Senior Vice President, ACIM, ACGIM and ACS
Robert Leach, 4500 Main Street, Kansas City, MO 64111
Year of Birth: 1966
Position(s) Held with Funds: Vice President, Treasurer and Chief Financial Officer
(all since 2006)
Principal Occupation(s) During Past 5 Years: Vice President, ACS (February 2000 to present);
and Controller, various American Century Investments funds (1997 to September 2006)
Jon Zindel, 4500 Main Street, Kansas City, MO 64111
Year of Birth: 1967
Position(s) Held with Funds: Tax Officer (since 1998)
Principal Occupation(s) During Past 5 Years: Chief Financial Officer and Chief Accounting
Officer, ACC (March 2007 to present); Vice President, ACC (October 2001 to
present); Vice President, certain ACC subsidiaries (October 2001 to August 2006);
Vice President, Corporate Tax, ACS (April 1998 to August 2006). Also serves as:
Chief Financial Officer, Chief Accounting Officer and Senior Vice President, ACIM,
ACGIM, ACS and other ACC subsidiaries; and Chief Accounting Officer and Senior
Vice President, ACIS
David H. Reinmiller, 4500 Main Street, Kansas City, MO 64111
Year of Birth: 1963
Position(s) Held with Funds: Vice President (since September 2000)
Principal Occupation(s) During Past 5 Years: Attorney, ACC (January 1994 to present);
Associate General Counsel, ACC (January 2001 to present); Chief Compliance
Officer, American Century Investments funds, ACIM and ACGIM (January 2001 to
February 2005). Also serves as: Associate General Counsel, ACIM, ACGIM, ACS,
ACIS and other ACC subsidiaries; and Vice President, ACIM, ACGIM and ACS
Ward Stauffer, 4500 Main Street, Kansas City, MO 64111
Year of Birth: 1960
Position(s) Held with Funds: Secretary (since February 2005)
Principal Occupation(s) During Past 5 Years: Attorney, ACC (June 2003 to present)
The SAI has additional information about the funds’ directors and is available without charge, upon request, by calling 1-800-345-2021.
101
Approval of Management Agreements |
Under Section 15(c) of the Investment Company Act, contracts for investment advisory services are required to be reviewed, evaluated and approved by a majority of a fund’s independent directors (the “Directors”) each year. At American Century Investments, this process is referred to as the “15(c) Process.” As a part of this process, the board reviews fund performance, shareholder services, audit and compliance information, and a variety of other reports from the advisor concerning fund operations. In addition to this annual review, the board of directors oversees and evaluates on a continuous basis at its quarterly meetings the nature and quality of significant services performed by the advisor, fund performance, audit and compliance information, and a variety of other reports relating to fund operations. The board, or committees of the board, also holds special meetings as needed.
Under a Securities and Exchange Commission rule, each fund is required to disclose in its annual or semiannual report, as appropriate, the material factors and conclusions that formed the basis for the board’s approval or renewal of any advisory agreements within the fund’s most recently completed fiscal half-year period.
Annual Contract Review Process
As part of the annual 15(c) Process undertaken during the most recent fiscal half-year period, the Directors reviewed extensive data and information compiled by the advisor and certain independent providers of evaluative data (the “15(c) Providers”) concerning LIVESTRONG Income Portfolio, LIVESTRONG 2015 Portfolio, LIVESTRONG
2020 Portfolio, LIVESTRONG 2025 Portfolio, LIVESTRONG 2030 Portfolio, LIVESTRONG 2035 Portfolio, LIVESTRONG 2040 Portfolio, LIVESTRONG 2045 P ortfolio and LIVESTRONG 2050 Portfolio (the “Funds”) and the services provided to the Funds under the management agreement. The information considered and the discussions held at the meetings included, but were not limited to:
• the nature, extent and quality of investment management, shareholder services and other services provided to the Funds;
• the wide range of programs and services the advisor provides to the Funds and their shareholders on a routine and non-routine basis;
• the compliance policies, procedures, and regulatory experience of the advisor;
• data comparing the cost of owning the Funds to the cost of owning a similar fund;
• data comparing the Funds’ performance to appropriate benchmarks and/ or a peer group of other mutual funds with similar investment objectives and strategies;
• financial data showing the profitability of the Funds to the advisor and the overall profitability of the advisor;
102
• data comparing services provided and charges to other investment management clients of the advisor; and
• consideration of collateral benefits derived by the advisor from the management of the Funds and any potential economies of scale relating thereto.
In keeping with its practice, the Funds’ board of directors held two in-person meetings and one telephonic meeting to review and discuss the information provided. The board also had the benefit of the advice of its independent counsel throughout the period.
Factors Considered
The Directors considered all of the information provided by the advisor, the 15(c) Providers, and the board’s independent counsel, and evaluated such information for each fund for which the board has responsibility. In connection with their review of the Funds, the Directors did not identify any single factor as being all-important or controlling, and each Director may have attributed different levels of importance to different factors. In deciding to renew the management agreement under the terms ultimately determined by the board to be appropriate, the Directors’ decision was based on the following factors.
Nature, Extent and Quality of Services — Generally. Under the management agreement, the advisor is responsible for providing or arranging for all services necessary for the operation of the Funds. The board noted that under the management agreement, the advisor provides or arranges at its own expense a wide variety of services including:
• Fund construction and design
• portfolio security selection
• initial capitalization/funding
• securities trading
• Fund administration
• custody of Fund assets
• daily valuation of each Fund’s portfolio
• shareholder servicing and transfer agency, including shareholder confirmations, recordkeeping and communications
• legal services
• regulatory and portfolio compliance
• financial reporting
• marketing and distribution
103
The Directors noted that many of the services provided by the advisor have expanded over time both in terms of quantity and complexity in response to shareholder demands, competition in the industry and the changing regulatory environment. They discussed with the advisor the challenges presented by these changes and the impact on the Funds. In performing their evaluation, the Directors considered information received in connection with the annual review, as well as information provided on an ongoing basis at their regularly scheduled board and committee meetings.
Investment Management Services. The nature of the investment management services provided to the Funds is quite complex and allows Fund shareholders access to professional money management, instant diversification of their investments, and liquidity. In evaluating investment performance, the board expects the advisor to manage the Funds in accordance with its investment objectives and approved strategies. Further, the Directors recognize that the advisor has an obligation to monitor trading activities, and in particular to seek the best execution of fund trades, and to evaluate the use of and payment for research. In providing these services, the advisor utilizes teams of investment professionals (portfolio managers, analysts, research assistants, and securities traders) who require extensive information technology, research, training, com pliance and other systems to conduct their business. At each quarterly meeting the Directors review investment performance information for the Funds, together with comparative information for appropriate benchmarks and/or peer groups of funds managed similarly to the Funds. The Directors also review detailed performance information during the 15(c) Process comparing each Fund’s performance with that of similar funds not managed by the advisor. If performance concerns are identified, the Directors discuss with the advisor the reasons for such results (e.g., market conditions, security selection) and any efforts being undertaken to improve performance. The performance of each of LIVESTRONG Income Portfolio, LIVESTRONG 2015 Portfolio, LIVESTRONG 2025 Portfolio, LIVESTRONG 2035 Portfolio and LIVESTRONG 2045 Portfolio was above the median of its respective peer group for both the one- and three-year periods. LIVESTRONG 2020 Portfolio, LIVESTRONG 2030 Portfolio, LIVESTRONG 2040 Portfolio and LIVESTRONG 2050 Portfolio had less than one-year performance history.
Shareholder and Other Services. The advisor provides the Funds with a comprehensive package of transfer agency, shareholder, and other services. The Directors review reports and evaluations of such services at their regular quarterly meetings, including the annual meeting concerning contract review, and reports to the board. These reports include, but are not limited to, information regarding the operational efficiency and accuracy of the shareholder and transfer agency services provided, staffing levels, shareholder satisfaction (as measured by external as well as internal sources), technology support, new products and services offered to Fund shareholders, securities trading activities, portfolio valuation services, auditing services, and legal and operational compliance activities. Certain aspects of shareholder and transfer agency serv ice level efficiency and the quality of securities trading activities are measured by independent third party providers and are presented in comparison to other fund groups not managed by the advisor.
104
Costs of Services Provided and Profitability. The advisor provides detailed information concerning its cost of providing various services to the Funds, its profitability in managing the Funds, its overall profitability, and its financial condition. The Directors have reviewed with the advisor the methodology used to prepare this financial information. This financial information regarding the advisor is considered in order to evaluate the advisor’s financial condition, its ability to continue to provide services under the management agreement, and the reasonableness of the current management fee. The board concluded that the advisor’s profits were reasonable in light of the services provided to the Funds.
Ethics. The Directors generally consider the advisor’s commitment to providing quality services to shareholders and to conducting its business ethically. They noted that the advisor’s practices generally meet or exceed industry best practices.
Economies of Scale. The Directors review information provided by the advisor regarding the possible existence of economies of scale in connection with the management of the Funds. The Directors concluded that economies of scale are difficult to measure and predict with precision, especially on a fund-by-fund basis. The analysis of economies of scale is further complicated by the additional services and content provided by the advisor and its reinvestment in its ability to provide and expand those services. Accordingly, the Directors seek to evaluate economies of scale by reviewing other information, such as year-over-year profitability of the advisor generally, the profitability of its management of the Funds specifically, the expenses incurred by the advisor in providing various functions to the Funds, and the fees of competitive funds no t managed by the advisor. The Directors believe the advisor is appropriately sharing economies of scale through its competitive fee structure, fee breakpoints as each Fund increases in size, and through reinvestment in its business to provide shareholders additional content and services.
Comparison to Other Funds’ Fees. The Funds invest their non-cash assets entirely in other American Century Investments funds. The Funds do not pay an investment advisor fee to the advisor. Rather each fund indirectly bears its pro rata share of the expenses incurred by the underlying funds and the Investor, Advisor and R Classes pay the advisor a 0.20% administrative fee. Each of the underlying Funds pay the advisor a single, all-inclusive (or unified) management fee for providing all services necessary for the management and operation of the Funds, other than brokerage expenses, taxes, interest, extraordinary expenses, and the fees and expenses of each Fund’s independent directors (including their independent legal counsel). Under the unified fee structure, the advisor is responsible for providing all investment advisory, custod y, audit, administrative, compliance, record-keeping, marketing and shareholder services, or arranging and supervising third parties to provide such services. By contrast, most other funds are charged a variety of fees, including an investment advisory fee, a transfer agency fee, an administrative fee, distribution charges and other expenses. Other than their investment advisory fees and Rule 12b-1 distribution fees, all other components of the total fees charged by these other funds may be increased without shareholder approval. The board believes the unified
105
fee structure is a benefit to Fund shareholders because it clearly discloses to shareholders the cost of owning Fund shares, and, since the unified fee cannot be increased without a vote of Fund shareholders, it shifts to the advisor the risk of increased costs of operating the Fund and provides a direct incentive to minimize administrative inefficiencies. Part of the Directors’ analysis of fee levels involves reviewing certain evaluative data compiled by a 15(c) Provider comparing each Fund’s total expense ratio to the total expense ratio of other funds in the Fund’s peer group and performing a regression analysis to evaluate the effect of fee breakpoints as assets under management increase. The total expenses paid by shareholders of LIVESTRONG 2020 Portfo lio, LIVESTRONG 2025 Portfolio, LIVESTRONG 2030 Portfolio, LIVESTRONG 2035 Portfolio and LIVESTRONG 2040 Portfolio were at or below the median of the total expense ratios of their respective peer groups. The total expenses paid by shareholders of LIVESTRONG Income Portfolio, LIVESTRONG 2015 Portfolio and LIVESTRONG 2045 Portfolio were above the median of the total expense ratios of their respective peer groups. In addition, the Directors also reviewed updated fee level data provided by the advisor, but recognized that comparative data was particularly difficult to evaluate given the significant market developments during the past year. The board concluded that the total expenses paid by each Fund were reasonable in light of the services provided to the Fund.
Comparison to Fees and Services Provided to Other Clients of the Advisor. The Directors also requested and received information from the advisor concerning the nature of the services, fees, and profitability of its advisory services to advisory clients other than the Funds. They observed that these varying types of client accounts require different services and involve different regulatory and entrepreneurial risks than the management of the Funds. The Directors analyzed this information and concluded that the fees charged and services provided to the Funds were reasonable by comparison.
Collateral Benefits Derived by the Advisor. The Directors considered the existence of collateral benefits the advisor may receive as a result of its relationship with the Funds. They concluded that the advisor’s primary business is managing mutual funds and it generally does not use fund or shareholder information to generate profits in other lines of business, and therefore does not derive any significant collateral benefits from them. The Directors noted that the advisor receives proprietary research from broker-dealers that execute fund portfolio transactions and concluded that this research is likely to benefit fund shareholders. The Directors also determined that the advisor is able to provide investment management services to certain clients other than the Funds, at least in part, due to its existing infrastructure built to serv e the fund complex. The Directors concluded, however, that the assets of those other clients are not material to the analysis and, in any event, are included with the assets of the Funds to determine breakpoints in each Fund’s fee schedule, provided they are managed using the same investment team and strategy.
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Conclusions of the Directors
As a result of this process, the board, including all of the independent directors, in the absence of particular circumstances and assisted by the advice of legal counsel that is independent of the advisor, taking into account all of the factors discussed above and the information provided by the advisor concluded that the investment management agreement between each Fund and the advisor is fair and reasonable in light of the services provided and should be renewed.
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Additional Information |
Retirement Account Information
As required by law, distributions you receive from certain IRAs, or 403(b), 457 and qualified plans are subject to federal income tax withholding, unless you elect not to have withholding apply. Tax will be withheld on the total amount withdrawn even though you may be receiving amounts that are not subject to withholding, such as nondeductible contributions. In such case, excess amounts of withholding could occur. You may adjust your withholding election so that a greater or lesser amount will be withheld.
If you don’t want us to withhold on this amount, you must notify us to not withhold the federal income tax. You may notify us in writing or in certain situations by telephone or through other electronic means. You have the right to revoke your withholding election at any time and any election you make may remain in effect until revoked by filing a new election.
Remember, even if you elect not to have income tax withheld, you are liable for paying income tax on the taxable portion of your withdrawal. If you elect not to have income tax withheld or you don’t have enough income tax withheld, you may be responsible for payment of estimated tax. You may incur penalties under the estimated tax rules if your withholding and estimated tax payments are not sufficient. You can reduce or defer the income tax on a distribution by directly or indirectly rolling such distribution over to another IRA or eligible plan. You should consult your tax advisor for additional information.
State tax will be withheld if, at the time of your distribution, your address is within one of the mandatory withholding states and you have federal income tax withheld. State taxes will be withheld from your distribution in accordance with the respective state rules.
Proxy Voting Guidelines
American Century Investment Management, Inc., the funds’ investment advisor, is responsible for exercising the voting rights associated with the securities purchased and/or held by the funds. A description of the policies and procedures the advisor uses in fulfilling this responsibility is available without charge, upon request, by calling 1-800-345-2021. It is also available on American Century Investments’ website at americancentury.com and on the Securities and Exchange Commission’s website at sec.gov. Information regarding how the investment advisor voted proxies relating to portfolio securities during the most recent 12-month period ended June 30 is available on the “About Us” page at americancentury.com. It is also available at sec.gov.
Quarterly Portfolio Disclosure
The funds file their complete schedule of portfolio holdings with the Securities and Exchange Commission (SEC) for the first and third quarters of each fiscal year on Form N-Q. The funds’ Forms N-Q are available on the SEC’s website at sec.gov, and may be reviewed and copied at 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. The funds also make their complete schedule of portfolio holdings for the most recent quarter of their fiscal year available on their website at americancentury.com and, upon request, by calling 1-800-345-2021.
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Index Definitions |
The following indices are used to illustrate investment market, sector, or style performance or to serve as fund performance comparisons. They are not investment products available for purchase.
The Citigroup Non-US World Government Bond Index is based on the Citigroup World Bond Index, and excludes issues denominated in U.S. dollars. The index measures the total return of government securities in major sectors of the international bond market.
The Citigroup US Broad Investment-Grade (BIG) Bond Index is a market-capitalization-weighted index that includes fixed-rate Treasury, government-sponsored, mortgage, asset-backed, and investment-grade issues with a maturity of one year or longer.
The Citigroup US Treasury 10-Year Benchmark (On-the-Run) Index measures total returns for the current 10-year on-the-run Treasuries that have been in existence for the entire month.
The Citigroup US Treasury Bill Three-Month Index measures monthly return equivalents of yield averages that are not marked to market. The Treasury Bill Three-Month Index is an average of the last three three-month Treasury bill month-end rates.
Morgan Stanley Capital International (MSCI) has developed several indices that measure the performance of foreign stock markets.
The MSCI EAFE (Europe, Australasia, Far East) Index is designed to measure developed market equity performance, excluding the U.S. and Canada.
The MSCI EM (Emerging Markets) Index represents the performance of stocks in global emerging market countries.
The Russell 1000® Index is a market-capitalization weighted, large-cap index created by Frank Russell Company to measure the performance of the 1,000 largest publicly traded U.S. companies, based on total market capitalization.
The Russell 2000® Index is a market-capitalization weighted index created by Frank Russell Company to measure the performance of the 2,000 smallest of the 3,000 largest publicly traded U.S. companies, based on total market capitalization.
The Russell 3000® Index measures the performance of the 3,000 largest U.S. companies based on total market capitalization, which represents approximately 98% of the investable U.S. equity market.
The Russell Midcap® Index measures the performance of the 800 smallest of the 1,000 largest publicly traded U.S. companies, based on total market capitalization.
109
Notes |
110
![](https://capedge.com/proxy/N-CSR/0001467105-09-000019/cl-ann66295x116x1.jpg)
Contact Us | |
americancentury.com | |
Automated Information Line | 1-800-345-8765 |
Investor Services Representative | 1-800-345-2021 or |
816-531-5575 | |
Business, Not-For-Profit, Employer-Sponsored | |
Retirement Plans | 1-800-345-3533 |
Banks and Trust Companies, Broker-Dealers, | |
Financial Professionals, Insurance Companies | 1-800-345-6488 |
Telecommunications Device for the Deaf | 1-800-634-4113 |
American Century Asset Allocation Portfolios, Inc. | |
Investment Advisor: | |
American Century Investment Management, Inc. | |
Kansas City, Missouri |
This report and the statements it contains are submitted for the general
information of our shareholders. The report is not authorized for distribution to
prospective investors unless preceded or accompanied by an effective prospectus.
American Century Investment Services, Inc., Distributor
©2009 American Century Proprietary Holdings, Inc. All rights reserved.
0909
CL-ANN-66295N
Annual Report |
July 31, 2009 |
American Century Investments |
One Choice Portfolio®: Very Conservative
One Choice Portfolio®: Conservative
One Choice Portfolio®: Moderate
One Choice Portfolio®: Aggressive
One Choice Portfolio®: Very Aggressive
President’s Letter |
Dear Investor:
Thank you for investing with us during the financial reporting period ended July 31, 2009. We appreciate your trust in American Century Investments® during these challenging times.
The U.S. economy continued to struggle at the close of the reporting period, part of the lingering fallout from the subprime-initiated credit and financial crises and global recession that shook the capital markets during the past two years. The recession has affected everyone—from first-time individual investors to hundred-year-old financial institutions.
However, as we mark the second anniversary of the start of the subprime mortgage meltdown, the worst of the economic and financial market obstacles appear to be behind us. The rate of U.S. economic decline has slowed, as have the drop-offs in housing prices and jobs. Risk appetites returned to the markets in recent months, evidenced by the strong stock rebound since early March.
Risk was a predominant theme during the reporting period, as the investment pendulum swung from risk avoidance to risk acceptance. We believe, however, that caution and risk management are still advisable. We don’t think we’re out of the economic woods yet, not with mortgage and corporate default rates on the rise, housing prices continuing to decline in some regions, and job losses still mounting.
Effective risk management requires a commitment to disciplined investment approaches that balance risk and reward, with the goal of setting and maintaining risk levels that are appropriate for portfolio objectives. At American Century Investments, we’ve stayed true to the principles that have guided us for over 50 years, including our commitment to delivering superior investment performance and helping investors reach their financial goals. Risk management is part of that commitment—we offer portfolios that can help diversify and stabilize investment returns.
The coming months will likely present additional challenges, but I’m certain that we have the investment professionals and processes in place to provide competitive and compelling long-term results for you. Thank you for your continued confidence in us.
Sincerely,
![](https://capedge.com/proxy/N-CSR/0001467105-09-000019/cl-ann66296x2x2.jpg)
Jonathan S. Thomas
President and Chief Executive Officer
American Century Investments
Independent Chairman’s Letter |
I am Don Pratt, an independent director and chairman of the mutual fund board responsible for the U.S. Growth Equity, U.S. Value Equity, Global and Non-U.S. Equity and Asset Allocation funds managed by American Century Investments. The board consists of seven independent directors and two directors who are affiliated with the investment advisor.
As one of your independent shareholder representatives on the fund board, I plan to write you from time to time with updates on board activities and news about your funds. My co-independent directors and I are committed to putting your interests first. We work closely with American Century Investments on maintaining strong fund performance, providing quality service to shareholders at competitive fees and ensuring ethical business practices and compliance with all applicable fund regulations.
Last year, the board welcomed its newest independent director, John R. Whitten He is a great addition to an experienced board where, collectively, the independent directors have served the funds for more than 76 years. This continuity served shareholders well as the investment advisor initiated a successful management transition, creating a strong senior leadership team consisting of well-tenured company executives and experienced industry veterans. Under the leadership of President and Chief Executive Officer Jonathan Thomas and Chief Investment Officer Enrique Chang, the firm has made the achievement of superior investment performance its primary focus and the key driver of its success going forward. This focus helped the company generate strong relative performance against the backdrop of 2008’s unprecedented market volatility.
As investors in the American Century funds, my fellow directors and I share your investing experience. We know firsthand how decisions made at the board level affect all shareholders. To further guide our efforts on your behalf, I invite you to send me your comments, questions or suggestions by email to dhpratt@fundboardchair.com. Thank you for allowing me to serve as your advocate on our board.
![](https://capedge.com/proxy/N-CSR/0001467105-09-000019/cl-ann66296x3x2.jpg)
Table of Contents |
One Choice Portfolios | |
Performance | 2 |
Portfolio Commentary | 7 |
Underlying Fund Allocations. | 7 |
Market Index Total Returns | 8 |
Shareholder Fee Examples | 12 |
Financial Statements | |
Schedule of Investments | 14 |
Statement of Assets and Liabilities | 17 |
Statement of Operations | 19 |
Statement of Changes in Net Assets | 21 |
Notes to Financial Statements | 24 |
Financial Highlights | 35 |
Report of Independent Registered Public Accounting Firm | 40 |
Other Information | |
Management | 41 |
Approval of Management Agreements | 45 |
Additional Information | 50 |
Index Definitions | 51 |
The opinions expressed in the Portfolio Commentary reflect those of the portfolio management team as of the date of the report, and do not necessarily represent the opinions of American Century Investments or any other person in the American Century Investments organization. Any such opinions are subject to change at any time based upon market or other conditions and American Century Investments disclaims any responsibility to update such opinions. These opinions may not be relied upon as investment advice and, because investment decisions made by American Century Investments funds are based on numerous factors, may not be relied upon as an indication of trading intent on behalf of any American Century Investments fund. Security examples are used for representational purposes only and are not intended as recommendations to purchase or sell securities. Performance information for comparative indices and securities is pr ovided to American Century Investments by third party vendors. To the best of American Century Investments’ knowledge, such information is accurate at the time of printing.
Performance |
One Choice Portfolios | |||
Total Returns as of July 31, 2009 | |||
Average Annual | |||
Returns | |||
Since | Inception | ||
1 year | Inception | Date | |
One Choice Portfolio: | |||
Very Conservative — Investor Class | -0.87% | 3.68% | 9/30/04 |
One Choice Portfolio: | |||
Conservative — Investor Class | -6.05% | 3.36% | 9/30/04 |
One Choice Portfolio: | |||
Moderate — Investor Class | -11.94% | 3.37% | 9/30/04 |
One Choice Portfolio: | |||
Aggressive — Investor Class | -17.28% | 3.04% | 9/30/04 |
One Choice Portfolio: | |||
Very Aggressive — Investor Class | -22.35% | 2.28% | 9/30/04 |
Russell 3000 Index(1) | -20.21% | 0.03% | — |
Citigroup US Broad Investment-Grade Bond Index | 8.63% | 5.16% | — |
(1) | Data provided by Lipper Inc. – A Reuters Company. © 2009 Reuters. All rights reserved. Any copying, republication or redistribution of Lipper |
content, including by caching, framing or similar means, is expressly prohibited without the prior written consent of Lipper. Lipper shall not be | |
liable for any errors or delays in the content, or for any actions taken in reliance thereon. | |
The data contained herein has been obtained from company reports, financial reporting services, periodicals and other resources believed to be | |
reliable. Although carefully verified, data on compilations is not guaranteed by Lipper and may be incomplete. No offer or solicitations to buy or | |
sell any of the securities herein is being made by Lipper. |
The Russell 3000 Index represents approximately 98% of the investable U.S. equity market and provides a broad measure of equity performance. The Citigroup US Broad Investment-Grade Bond Index represents the U.S. investment-grade fixed-rate bond market and provides a broad measure of bond market performance. Performance for these indices is provided for reference only. Neither index is intended to represent the composition of the portfolio, which invests in a mix of equity and fixed-income securities. (See the Schedule of Investments for each portfolio’s asset allocations as of July 31, 2009.)
Data presented reflect past performance. Past performance is no guarantee of future results. Current performance may be higher or lower than the performance shown. Investment return and principal value will fluctuate, and redemption value may be more or less than original cost. To obtain performance data current to the most recent month end, please call 1-800-345-2021 or visit americancentury.com. The performance of the portfolios is dependent on the performance of their underlying American Century Investments funds, and will assume the risks associated with these funds. The risks will vary according to each portfolio’s asset allocation, and the risk level assigned to each portfolio is intended to reflect the relative short-term price volatility among the funds in each. International investing involves special risks, such as political instability and currency fluctuations. Investing in emerging markets may accentuate t hese risks. As interest rates rise, bond values will decline.
Data assumes reinvestment of dividends and capital gains, and none of the charts reflect the deduction of taxes that a shareholder would pay on fund distributions or the redemption of fund shares. Returns for the indices are provided for comparison. The fund’s total returns include operating expenses that reduce returns, while the total returns of the indices do not.
2
One Choice Portfolios
![](https://capedge.com/proxy/N-CSR/0001467105-09-000019/cl-ann66296x7x1.jpg)
*From 9/30/04, the Investor Class’s inception date. Not annualized.
Data presented reflect past performance. Past performance is no guarantee of future results. Current performance may be higher or lower than the performance shown. Investment return and principal value will fluctuate, and redemption value may be more or less than original cost. To obtain performance data current to the most recent month end, please call 1-800-345-2021 or visit americancentury.com. The performance of the portfolios is dependent on the performance of their u nderlying American Century Investments funds, and will assume the risks associated with these funds. The risks will vary according to each portfolio’s asset allocation, and the risk level assigned to each portfolio is intended to reflect the relative short-term price volatility among the funds in each. International investing involves special risks, such as political instability and currency fluctuations. Investing in emerging markets may accentuate these risks. As interest rates rise, bond values will decline.
Data assumes reinvestment of dividends and capital gains, and none of the charts reflect the deduction of taxes that a shareholder would pay on fund distributions or the redemption of fund shares. Returns for the indices are provided for comparison. The fund’s total returns include operating expenses that reduce returns, while the total returns of the indices do not.
3
One Choice Portfolios
![](https://capedge.com/proxy/N-CSR/0001467105-09-000019/cl-ann66296x8x1.jpg)
*From 9/30/04, the Investor Class’s inception date. Not annualized.
Data presented reflect past performance. Past performance is no guarantee of future results. Current performance may be higher or lower than the performance shown. Investment return and principal value will fluctuate, and redemption value may be more or less than original cost. To obtain performance data current to the most recent month end, please call 1-800-345-2021 or visit americancentury.com. The performance of the portfolios is dependent on the performance of their underlying American Century Investments funds, and will assume the risks associated with these funds. The risks will vary according to each portfolio’s asset allocation, and the risk level assigned to each portfolio is intended to reflect the relative short-term price volatility among the funds in each. International investing involves special risks, such as political instability and currency fluctuations. Investing in emerging markets may accentuate thes e risks. As interest rates rise, bond values will decline.
Data assumes reinvestment of dividends and capital gains, and none of the charts reflect the deduction of taxes that a shareholder would pay on fund distributions or the redemption of fund shares. Returns for the indices are provided for comparison. The fund’s total returns include operating expenses that reduce returns, while the total returns of the indices do not.
4
One Choice Portfolios
![](https://capedge.com/proxy/N-CSR/0001467105-09-000019/cl-ann66296x9x1.jpg)
*From 9/30/04, the Investor Class’s inception date. Not annualized.
Data presented reflect past performance. Past performance is no guarantee of future results. Current performance may be higher or lower than the performance shown. Investment return and principal value will fluctuate, and redemption value may be more or less than original cost. To obtain performance data current to the most recent month end, please call 1-800-345-2021 or visit americancentury.com. The performance of the portfolios is dependent on the performance of their underlying American Century Investments funds, and will assume the risks associated with these funds. The risks will vary according to each portfolio’s asset allocation, and the risk level assigned to each portfolio is intended to reflect the relative short-term price volatility among the funds in each. International investing involves special risks, such as political instability and currency fluctuations. Investing in emerging markets may accentuate t hese risks. As interest rates rise, bond values will decline.
Data assumes reinvestment of dividends and capital gains, and none of the charts reflect the deduction of taxes that a shareholder would pay on fund distributions or the redemption of fund shares. Returns for the indices are provided for comparison. The fund’s total returns include operating expenses that reduce returns, while the total returns of the indices do not.
5
One Choice Portfolios | |||||
One-Year Returns Over Life of Class | |||||
Periods ended July 31 | |||||
2005* | 2006 | 2007 | 2008 | 2009 | |
One Choice Portfolio: | |||||
Very Conservative — Investor Class | 5.43% | 3.27% | 7.23% | 2.91% | -0.87% |
One Choice Portfolio: | |||||
Conservative — Investor Class | 8.08% | 4.45% | 10.41% | 0.18% | -6.05% |
One Choice Portfolio: | |||||
Moderate — Investor Class | 11.71% | 6.68% | 14.56% | -2.37% | -11.94% |
One Choice Portfolio: | |||||
Aggressive — Investor Class | 13.61% | 7.84% | 18.78% | -3.97% | -17.28% |
One Choice Portfolio: | |||||
Very Aggressive — Investor Class | 15.81% | 9.00% | 21.87% | -6.63% | -22.35% |
Russell 3000 Index | 14.67% | 5.14% | 16.08% | -10.32% | -20.21% |
Citigroup US Broad Investment-Grade | |||||
Bond Index | 2.72% | 1.47% | 5.55% | 6.72% | 8.63% |
*From 9/30/04, the Investor Class’s inception date. Not annualized. | |||||
Total Annual Fund Operating Expenses | |||||
One Choice Portfolio: Very Conservative — Investor Class | 0.69% | ||||
One Choice Portfolio: Conservative — Investor Class | 0.77% | ||||
One Choice Portfolio: Moderate — Investor Class | 0.86% | ||||
One Choice Portfolio: Aggressive — Investor Class | 0.94% | ||||
One Choice Portfolio: Very Aggressive — Investor Class | 1.00% |
The total annual fund operating expenses shown is as stated in the fund’s prospectus current as of the date of this report. The prospectus may vary from the expense ratio shown elsewhere in this report because it is based on a different time period, includes acquired fund fees and expenses, and, if applicable, does not include fee waivers or expense reimbursements.
Data presented reflect past performance. Past performance is no guarantee of future results. Current performance may be higher or lower than the performance shown. Investment return and principal value will fluctuate, and redemption value may be more or less than original cost. To obtain performance data current to the most recent month end, please call 1-800-345-2021 or visit americancentury.com. The performance of the portfolios is dependent on the performance of their underlying American Century Investments funds, and will assume the risks associated with these funds. The risks will vary according to each portfolio’s asset allocation, and the risk level assigned to each portfolio is intended to reflect the relative short-term price volatility among the funds in each. International investing involves special risks, such as political instability and currency fluctuations. Investing in emerging markets may accentuate t hese risks. As interest rates rise, bond values will decline.
Data assumes reinvestment of dividends and capital gains, and none of the charts reflect the deduction of taxes that a shareholder would pay on fund distributions or the redemption of fund shares. Returns for the indices are provided for comparison. The fund’s total returns include operating expenses that reduce returns, while the total returns of the indices do not.
6
Portfolio Commentary |
One Choice Portfolios
Portfolio Managers: Enrique Chang, Scott Wittman, and Irina Torelli
Portfolio manager Jeff Tyler, who has managed the One Choice Portfolios since their inception in 2004, left the management team on June 30, 2009, and retired after a distinguished 28-year investment career. To replace Mr. Tyler, Scott Wittman joined the portfolio management team in June 2009. Mr. Wittman came to American Century Investments from Munder Capital Management, and he brings 25 years of industry experience and expertise across a diverse array of asset classes. In addition, chief investment officer Enrique Chang joined the management team in January 2009.
Performance Summary
Each of the five One Choice Portfolios declined for the fiscal year ended July 31, 2009, with returns ranging from –0.87% for the One Choice Portfolio: Very Conservative to –22.35% for the One Choice Portfolio: Very Aggressive (see pages 2–6 for more detailed performance information). The negative returns resulted primarily from a sharp decline in the global equity markets; in contrast, bonds delivered solidly positive returns for the 12-month period.
Because of the Portfolios’ strategic exposure to a variety of asset classes, a review of the financial markets helps explain much of their performance.
Underlying Fund Allocations as a % of net assets as of July 31, 2009(1) | |||||
Very | Very | ||||
Conservative Conservative | Moderate | Aggressive | Aggressive | ||
Equity | |||||
Equity Growth Fund | 4.7% | 8.8% | 15.8% | 14.2% | 17.3% |
Growth Fund | 3.2% | 5.5% | 8.7% | 15.2% | 18.4% |
Large Company Value Fund | 7.7% | 10.7% | 9.0% | 7.9% | 9.8% |
Real Estate Fund | 2.0% | 2.0% | 2.0% | 2.0% | 1.9% |
Small Company Fund | 1.1% | 1.6% | 2.1% | 2.3% | 2.6% |
Value Fund | 5.0% | 6.7% | 5.1% | 4.3% | 5.5% |
Vista Fund | 1.5% | 4.0% | 7.0% | 13.3% | 16.2% |
Emerging Markets Fund | — | — | 4.2% | 6.8% | 7.7% |
International Growth Fund | — | 6.3% | 10.4% | 12.9% | 15.9% |
Total Equity | 25.2% | 45.6% | 64.3% | 78.9% | 95.3% |
Fixed Income | |||||
Diversified Bond Fund | 32.6% | 30.2% | 20.2% | 12.4% | 3.8% |
High-Yield Fund | — | — | 2.0% | 4.0% | — |
Inflation-Adjusted Bond Fund | 9.9% | 8.8% | 5.8% | 3.8% | — |
International Bond Fund | 10.1% | 7.9% | 2.9% | — | — |
Total Fixed Income | 52.6% | 46.9% | 30.9% | 20.2% | 3.8% |
Prime Money Market Fund | 22.2% | 7.5% | 4.8% | 0.9% | 0.9% |
Other Assets and Liabilities | —(2) | —(2) | —(2) | —(2) | —(2) |
(1) | Underlying fund investments represent Investor Class. |
(2) | Category is less than 0.05% of total net assets. |
7
One Choice Portfolios
Stock Market Review
U.S. stocks fell substantially during the 12-month period in an environment of extreme volatility and dramatic shifts in market sentiment. The major stock indices remained on a downward trajectory for much of the period as a deepening economic downturn, a worsening credit crunch, and a near collapse in the financial sector weighed on investor confidence.
The U.S. economy, already in recession since the end of 2007, contracted in the last two quarters of 2008 and the first two quarters of 2009. The slumping economy was characterized by substantial job losses (leading to the highest unemployment rate since 1983), a drop-off in consumer spending, and further deterioration in the housing market. At the same time, a lack of liquidity in the credit markets put enormous pressure on the balance sheets and profitability of financial companies worldwide. After a series of bankruptcies and takeovers swept through the financial sector in late 2008, the federal government moved swiftly to provide financial assistance and other support to prevent a full-scale breakdown in the financial system.
The economic and financial difficulties led to a steep market decline throughout the last half of 2008 and into early 2009. From the beginning of the reporting period through March 9, 2009, the broad stock indices plummeted by more than 45%.
Market conditions changed dramatically in the last few months of the period. The stock market hit a multi-year low on March 9 and then staged a powerful rally as signs of economic stabilization generated optimism about a possible recovery. Investors also grew more confident about the federal government’s actions to stimulate economic activity and restore liquidity in the credit markets.
Market Index Total Returns | |
For the 12 months ended July 31, 2009 | |
U.S. Stocks | |
Russell 1000 Index (Large-Cap) | –20.17% |
Russell Midcap Index | –22.22% |
Russell 2000 Index (Small-Cap) | –20.72% |
International Stocks | |
MSCI EAFE (Europe, Australasia, Far East) Index | –22.60% |
MSCI EM (Emerging Markets) Index | –16.84% |
U.S. Fixed Income | |
Citigroup US Broad Investment-Grade Bond Index | 8.63% |
Citigroup US Treasury 10-Year Benchmark (On-the-Run) Index | 7.49% |
Citigroup US Treasury Bill Three-Month Index | 0.65% |
International Bonds | |
Citigroup Non-US World Government Bond Index | 5.61% |
8
One Choice Portfolios
Despite a rebound of nearly 50% from March 9 through the end of July, the broad equity indices declined by more than 20% overall for the 12-month period (see the table on page 8). Performance was similar across all market capitalizations, but growth and value stocks were mixed—value outperformed among large-cap shares, growth won out among mid-cap issues, and growth and value returns were virtually identical in the small-cap segment of the market.
The 12-month period marked the first time since World War II that the U.S., Europe, and Japan were all in recession simultaneously. As a result, equity markets outside the U.S. followed the same path as the domestic stock market, though they experienced even greater volatility. Emerging markets were especially turbulent, plummeting in the first half of the period before surging back by more than 60% in the last six months. Among developed markets, Japan and its neighbors along the Pacific Rim posted the best returns, while European bourses lagged.
Bond Market Review
The U.S. bond market advanced steadily for the 12-month period, although market leadership changed abruptly. The deepening economic downturn, financial sector turmoil, and slumping stock market in the last half of 2008 and early 2009 led investors to seek out the safety of high-quality bonds, boosting Treasury securities at the expense of corporate bonds. However, as early signs of stabilization in the economy emerged, corporate securities led the bond market higher, while Treasury bonds tumbled as the government increased issuance to finance its fiscal stimulus efforts.
Overall, however, mortgage-backed securities generated the best returns for the 12-month period. Their outperformance was driven in part by the Federal Reserve’s purchases of mortgage-backed securities, particularly those issued by government agencies, to help keep mortgage rates low and boost the housing market. Corporate bonds were also strong performers, rebounding sharply after sizable declines in 2008, while Treasury securities lagged.
Foreign bonds also gained ground during the reporting period, largely because of a decline in the U.S. dollar versus many of the world’s major currencies in the last half of the period. The weaker dollar reflected relatively low U.S. interest rates and an increase in the government’s debt load, as well as a trend toward currency depreciation in countries where central banks were acting aggressively to arrest the economic downturn. The dollar’s decline enhanced foreign bond returns for U.S. investors.
9
One Choice Portfolios
Portfolio Performance
Each One Choice Portfolio is a “fund of funds” that invests in other Amer-ican Century Investments mutual funds to achieve its investment objective and target asset allocation. (See page 7 for the specific underlying fund allocations for each One Choice Portfolio.)
Within the Portfolios, every stock fund posted a negative return for the 12-month period. The worst performers included Real Estate, which tumbled by 45% as the commercial real estate market slumped, and Vista, the Portfolios’ mid-cap component. Small-cap holding Small Company and the two international components, International Growth and Emerging Markets, also fell by 25% or more for the reporting period. The best performers within the Portfolios’ equity holdings were Value, a multi-cap value fund, and Growth, a large-cap growth fund.
Diversified Bond, the primary fixed-income holding in the Portfolios, was the best-performing fund, reflecting the broad advance in the domestic bond market. Two other bond components, High-Yield and International Bond, also advanced modestly during the reporting period.
Portfolio Strategy
Each Portfolio has a “neutral” asset mix (the target allocations for stocks, bonds, and cash) that remains fixed over time. Effective June 1, the neutral asset mixes of all One Choice Portfolios were changed slightly. In each case, the percentage devoted to bonds increased by 1% or 2%, while the allocation to cash-equivalent investments decreased by 1% or 2%. We believe these changes will help the Portfolios better meet their investment objectives.
Our management approach involves making modest tactical adjustments to each Portfolio’s actual asset mix to add value and improve the Portfolios’ ability to meet their investment objectives. Over the last 12 months, we maintained a defensive position for the Portfolios, with a slight overweight position in bonds and a corresponding underweight position in stocks. This proved to be a favorable strategy as bonds outperformed stocks overall, although stocks outperformed during the last six months of the period.
In the equity portion of the Portfolios, we maintained our emphasis on growth versus value, with an overweight position in Growth and underweight positions in Value and Large Company Value. Results from this positioning were mixed—the overweight in Growth added value, as it was one of the better performers among the Portfolios’ equity components, but the underweight in Value weighed on overall results as Value posted the best return in the equity portion. Stock selection was especially effective in the two value components, while security selection detracted the most in Vista and Emerging Markets.
10
One Choice Portfolios
The Portfolios held overweight positions in Diversified Bond, which is the primary fixed-income component in each Portfolio. Diversified Bond produced a return that was in line with the broad bond market indices, though it outperformed over the last six months of the period. An underweight position in Treasury bonds and increased exposure to corporate bonds and high-quality municipal bonds contributed favorably to Diversified Bond’s performance. The High-Yield Fund, which is only held in One Choice Portfolio: Moderate and One Choice Portfolio: Aggressive, remained an underweight position.
In June, we added a meaningful position in Inflation-Adjusted Bond, comprising approximately 20% of each Portfolio’s fixed-income position (with the exception of One Choice Portfolio: Very Aggressive, which does not hold Inflation-Adjusted Bond). This change reflects our conviction that the enormous amount of fiscal stimulus and accommodative monetary policy in the U.S. has significantly raised the risk of higher inflation.
Outlook
The severe decline in stocks in the last half of 2008 and early 2009 was driven by fear and panic about a potential collapse in the financial system and a global economic downturn that could rival the Great Depression. The stock market rally of the last several months represented an easing of these concerns, but we are still a long way from a full financial and economic recovery. While the rate of decline in many segments of the economy—such as employment and housing—has been slowing, they are still declining. Furthermore, the savings rate in the U.S. recently hit a 15-year high at a time when the economy needs a shot in the arm from increased consumer spending.
As a result, we plan to maintain our focus on high-quality securities across all Portfolios. We remain concerned about a heightened risk of inflation going forward, which is why we have established a notable position in Inflation-Adjusted Bond in many of the Portfolios. In addition to inflation protection, Inflation-Adjusted Bond provides further diversification and possesses return dynamics that differ from all other asset classes in the Portfolios.
11
Shareholder Fee Examples (Unaudited) |
Fund shareholders may incur two types of costs: (1) transaction costs, including sales charges (loads) on purchase payments and redemption/ exchange fees; and (2) ongoing costs, including management fees; distribution and service (12b-1) fees; and other fund expenses. This example is intended to help you understand your ongoing costs (in dollars) of investing in your fund and to compare these costs with the ongoing cost of investing in other mutual funds. As a shareholder in the underlying American Century Investments funds, your fund will indirectly bear its pro rata share of the expenses incurred by the underlying funds. These expenses are not included in the fund’s annualized expense ratio or the expenses paid during the period. These expenses are, however, included in the effective expenses paid during the period.
The example is based on an investment of $1,000 made at the beginning of the period and held for the entire period from February 1, 2009 to July 31, 2009.
Actual Expenses
The table provides information about actual account values and actual expenses for each class. You may use the information, together with the amount you invested, to estimate the expenses that you paid over the period. First, identify the share class you own. Then 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 under the heading “Expenses Paid During Period” to estimate the expenses you paid on your account during this period.
If you hold Investor Class shares of any American Century Investments fund, or Institutional Class shares of the American Century Diversified Bond Fund, in an American Century Investments account (i.e., not a financial intermediary or retirement plan account), American Century Investments may charge you a $12.50 semiannual account maintenance fee if the value of those shares is less than $10,000. We will redeem shares automatically in one of your accounts to pay the $12.50 fee. In determining your total eligible investment amount, we will include your investments in all personal accounts (including American Century Investments Brokerage accounts) registered under your Social Security number. Personal accounts include individual accounts, joint accounts, UGMA/UTMA accounts, personal trusts, Coverdell Education Savings Accounts and IRAs (including traditional, Roth, Rollover, SEP-, SARSEP- and SIMPLE-IRAs), and certain other retirement accounts. If you have only business, business retirement, employer-sponsored or American Century Investments Brokerage accounts, you are currently not subject to this fee. We will not charge the fee as long as you choose to manage your accounts exclusively online. If you are subject to the Account Maintenance Fee, your account value could be reduced by the fee amount.
Hypothetical Example for Comparison Purposes
The table also provides information about hypothetical account values and hypothetical expenses based on the actual expense ratio of each class of your fund and an assumed rate of return of 5% per year before expenses, which is not the actual return of a fund’s share class. The hypothetical account values and expenses may not be used to estimate the actual ending account
12
balance or expenses you paid for the period. You may use this information to compare the ongoing costs of investing in your fund 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 table are meant to highlight your ongoing costs only and do not reflect any transactional costs, such as sales charges (loads) or redemption/exchange fees. Therefore, the table is useful in comparing ongoing costs only, and will not help you determine the relative total costs of owning different funds. In addition, if these transactional costs were included, your costs would have been higher.
Effective | ||||||
Expenses | Expenses | |||||
Beginning | Ending | Paid During | Paid During | Effective | ||
Account | Account | Period(1) | Annualized | Period(2) | Annualized | |
Value | Value | 2/1/09 - | Expense | 2/1/09 - | Expense | |
2/1/09 | 7/31/09 | 7/31/09 | Ratio(1) | 7/31/09 | Ratio(2) | |
One Choice Portfolio: Very Conservative | ||||||
Actual | $1,000 | $1,085.00 | $0.00 | 0.00%(3) | �� $3.57 | 0.69% |
Hypothetical | $1,000 | $1,024.79 | $0.00 | 0.00%(3) | $3.46 | 0.69% |
One Choice Portfolio: Conservative | ||||||
Actual | $1,000 | $1,127.00 | $0.00 | 0.00%(3) | $4.11 | 0.78% |
Hypothetical | $1,000 | $1,024.79 | $0.00 | 0.00%(3) | $3.91 | 0.78% |
One Choice Portfolio: Moderate | ||||||
Actual | $1,000 | $1,168.90 | $0.00 | 0.00%(3) | $4.73 | 0.88% |
Hypothetical | $1,000 | $1,024.79 | $0.00 | 0.00%(3) | $4.41 | 0.88% |
One Choice Portfolio: Aggressive | ||||||
Actual | $1,000 | $1,202.50 | $0.00 | 0.00%(3) | $5.30 | 0.97% |
Hypothetical | $1,000 | $1,024.79 | $0.00 | 0.00%(3) | $4.86 | 0.97% |
One Choice Portfolio: Very Aggressive | ||||||
Actual | $1,000 | $1,223.50 | $0.00 | 0.00%(3) | $5.73 | 1.04% |
Hypothetical | $1,000 | $1,024.79 | $0.00 | 0.00%(3) | $5.21 | 1.04% |
(1) | Expenses are equal to the fund’s annualized expense ratio listed in the table above, multiplied by the average account value over the period, multiplied by 181, the number of days in the most recent fiscal half-year, divided by 365, to reflect the one-half year period. The fees and expenses of the underlying American Century Investments funds in which the fund invests are not included in the fund’s annualized expense ratio. |
(2) | Effective expenses reflect the sum of expenses borne directly by the fund plus the fund’s pro rata share of the weighted average expense ratio of the underlying funds in which it invests. The effective annualized expense ratio combines the fund’s annualized expense ratio and the annualized weighted average expense ratio of the underlying funds. The annualized weighted average expense ratio of the underlying funds for the one-half year period reflects the actual expense ratio of each underlying fund from its most recent shareholder report, annualized and weighted for the fund’s relative average investment therein during the period. |
(3) | Other expenses, which include the fees and expenses of the fund’s independent directors and its legal counsel, as well as interest, did not exceed 0.005%. |
13
Schedule of Investments |
One Choice Portfolios | ||||||||
JULY 31, 2009 | ||||||||
Shares | Value | Shares | Value | |||||
One Choice Portfolio: Very Conservative | One Choice Portfolio: Conservative | |||||||
Mutual Funds(1) — 100.0% | Mutual Funds(1) — 100.0% | |||||||
DOMESTIC FIXED INCOME FUNDS — 42.5% | DOMESTIC EQUITY FUNDS — 39.3% | |||||||
Diversified Bond Fund | Equity Growth Fund | |||||||
Investor Class | 3,562,353 | $ 37,440,330 | Investor Class | 1,349,108 | $ 22,246,791 | |||
Inflation-Adjusted Bond | Growth Fund Investor Class | 711,829 | 13,766,773 | |||||
Fund Investor Class | 1,018,564 | 11,346,803 | Large Company Value Fund | |||||
48,787,133 | Investor Class | 5,971,111 | 26,929,711 | |||||
DOMESTIC EQUITY FUNDS — 25.2% | Real Estate Fund | |||||||
Equity Growth Fund | Investor Class | 461,178 | 5,063,734 | |||||
Investor Class | 329,231 | 5,429,019 | Small Company Fund | |||||
Growth Fund Investor Class | 187,385 | 3,624,026 | Investor Class | 731,733 | 4,017,214 | |||
Large Company Value Fund | Value Fund Investor Class | 3,659,900 | 16,872,139 | |||||
Investor Class | 1,967,444 | 8,873,172 | Vista Fund Investor Class(2) | 840,146 | 10,207,774 | |||
Real Estate Fund | 99,104,136 | |||||||
Investor Class | 213,289 | 2,341,913 | DOMESTIC FIXED INCOME FUNDS — 39.0% | |||||
Small Company Fund | Diversified Bond Fund | |||||||
Investor Class | 224,824 | 1,234,284 | Investor Class | 7,262,746 | 76,331,461 | |||
Value Fund Investor Class | 1,233,424 | 5,686,085 | Inflation-Adjusted Bond | |||||
Vista Fund Investor Class(2) | 145,440 | 1,767,096 | Fund Investor Class | 1,989,202 | 22,159,710 | |||
28,955,595 | 98,491,171 | |||||||
MONEY MARKET FUNDS — 22.2% | INTERNATIONAL FIXED INCOME FUNDS — 7.9% | |||||||
Prime Money Market Fund | International Bond Fund | |||||||
Investor Class | 25,423,737 | 25,423,737 | Investor Class | 1,352,745 | 20,034,153 | |||
INTERNATIONAL FIXED INCOME FUNDS — 10.1% | MONEY MARKET FUNDS — 7.5% | |||||||
International Bond Fund | Prime Money Market Fund | |||||||
Investor Class | 779,169 | 11,539,493 | Investor Class | 18,792,481 | 18,792,481 | |||
TOTAL INVESTMENT | INTERNATIONAL EQUITY FUNDS — 6.3% | |||||||
SECURITIES — 100.0% | International Growth Fund | |||||||
(Cost $111,610,273) | 114,705,958 | Investor Class | 1,803,403 | 15,996,185 | ||||
OTHER ASSETS AND LIABILITIES(3) | (7,001) | TOTAL INVESTMENT | ||||||
TOTAL NET ASSETS — 100.0% | $114,698,957 | SECURITIES — 100.0% | ||||||
(Cost $263,749,917) | 252,418,126 | |||||||
Notes to Schedule of Investments | OTHER ASSETS AND LIABILITIES(3) | (14,262) | ||||||
(1) | Investments are funds within the American Century Investments | TOTAL NET ASSETS — 100.0% | $252,403,864 | |||||
family of funds, of which certain funds may be deemed to be under | ||||||||
common control because of the same board of directors. | Notes to Schedule of Investments | |||||||
(2) | Non-income producing. | (1) | Investments are funds within the American Century Investments | |||||
(3) | Category is less than 0.05% of total net assets. | family of funds, of which certain funds may be deemed to be under | ||||||
common control because of the same board of directors. | ||||||||
(2) | Non-income producing. | |||||||
(3) | Category is less than 0.05% of total net assets. |
See Notes to Financial Statements.
14
One Choice Portfolios | ||||||||
Shares | Value | Shares | Value | |||||
One Choice Portfolio: Moderate | One Choice Portfolio: Aggressive | |||||||
Mutual Funds(1) — 100.0% | Mutual Funds(1) — 100.0% | |||||||
DOMESTIC EQUITY FUNDS — 49.7% | DOMESTIC EQUITY FUNDS — 59.2% | |||||||
Equity Growth Fund | Equity Growth Fund | |||||||
Investor Class | 5,212,157 | $ 85,948,469 | Investor Class | 3,018,599 | $ 49,776,698 | |||
Growth Fund Investor Class | 2,441,838 | 47,225,147 | Growth Fund Investor Class | 2,762,658 | 53,429,806 | |||
Large Company Value Fund | Large Company Value Fund | |||||||
Investor Class | 10,842,635 | 48,900,284 | Investor Class | 6,180,538 | 27,874,226 | |||
Real Estate Fund | Real Estate Fund | |||||||
Investor Class | 976,153 | 10,718,160 | Investor Class | 625,780 | 6,871,064 | |||
Small Company Fund | Small Company Fund | |||||||
Investor Class | 2,066,948 | 11,347,544 | Investor Class | 1,490,657 | 8,183,707 | |||
Value Fund Investor Class | 5,964,772 | 27,497,599 | Value Fund Investor Class | 3,251,074 | 14,987,451 | |||
Vista Fund Investor Class(2) | 3,113,198 | 37,825,356 | Vista Fund Investor Class(2) | 3,850,286 | 46,780,975 | |||
269,462,559 | 207,903,927 | |||||||
DOMESTIC FIXED INCOME FUNDS — 28.0% | DOMESTIC FIXED INCOME FUNDS — 20.2% | |||||||
Diversified Bond Fund | Diversified Bond Fund | |||||||
Investor Class | 10,433,340 | 109,654,403 | Investor Class | 4,143,713 | 43,550,424 | |||
High-Yield Fund Investor | High-Yield Fund | |||||||
Class | 1,999,943 | 10,899,689 | Investor Class | 2,565,249 | 13,980,607 | |||
Inflation-Adjusted Bond | Inflation-Adjusted Bond | |||||||
Fund Investor Class | 2,811,911 | 31,324,689 | Fund Investor Class | 1,202,474 | 13,395,560 | |||
151,878,781 | 70,926,591 | |||||||
INTERNATIONAL EQUITY FUNDS — 14.6% | INTERNATIONAL EQUITY FUNDS — 19.7% | |||||||
Emerging Markets Fund | Emerging Markets Fund | |||||||
Investor Class | 3,599,521 | 22,748,973 | Investor Class | 3,750,038 | 23,700,240 | |||
International Growth Fund | International Growth Fund | |||||||
Investor Class | 6,367,747 | 56,481,916 | Investor Class | 5,104,283 | 45,274,990 | |||
79,230,889 | 68,975,230 | |||||||
MONEY MARKET FUNDS — 4.8% | MONEY MARKET FUNDS — 0.9% | |||||||
Prime Money Market Fund | Prime Money Market Fund | |||||||
Investor Class | 25,707,084 | 25,707,084 | Investor Class | 3,297,875 | 3,297,875 | |||
INTERNATIONAL FIXED INCOME FUNDS — 2.9% | TOTAL INVESTMENT | |||||||
International Bond Fund | SECURITIES — 100.0% | |||||||
Investor Class | 1,075,634 | 15,930,139 | (Cost $406,816,870) | 351,103,623 | ||||
TOTAL INVESTMENT | OTHER ASSETS AND LIABILITIES(3) | (14,777) | ||||||
SECURITIES — 100.0% | TOTAL NET ASSETS — 100.0% | $351,088,846 | ||||||
(Cost $604,247,143) | 542,209,452 | |||||||
OTHER ASSETS AND LIABILITIES(3) | (27,091) | Notes to Schedule of Investments | ||||||
TOTAL NET ASSETS — 100.0% | $542,182,361 | (1) | Investments are funds within the American Century Investments | |||||
family of funds, of which certain funds may be deemed to be under | ||||||||
Notes to Schedule of Investments | common control because of the same board of directors. | |||||||
(1) | Investments are funds within the American Century Investments | (2) | Non-income producing. | |||||
family of funds, of which certain funds may be deemed to be under | (3) | Category is less than 0.05% of total net assets. | ||||||
common control because of the same board of directors. | ||||||||
(2) | Non-income producing. | |||||||
(3) | Category is less than 0.05% of total net assets. |
See Notes to Financial Statements.
15
One Choice Portfolios | |||
Shares | Value | ||
One Choice Portfolio: Very Aggressive | |||
Mutual Funds(1) — 100.0% | |||
DOMESTIC EQUITY FUNDS — 71.7% | |||
Equity Growth Fund | |||
Investor Class | 1,535,160 | $ 25,314,788 | |
Growth Fund Investor Class | 1,386,953 | 26,823,671 | |
Large Company Value Fund | |||
Investor Class | 3,189,968 | 14,386,756 | |
Real Estate Fund | |||
Investor Class | 258,650 | 2,839,977 | |
Small Company Fund | |||
Investor Class | 683,588 | 3,752,898 | |
Value Fund Investor Class | 1,736,774 | 8,006,528 | |
Vista Fund Investor Class(2) | 1,943,972 | 23,619,260 | |
104,743,878 | |||
INTERNATIONAL EQUITY FUNDS — 23.6% | |||
Emerging Markets Fund | |||
Investor Class | 1,785,207 | 11,282,508 | |
International Growth Fund | |||
Investor Class | 2,611,903 | 23,167,580 | |
34,450,088 | |||
DOMESTIC FIXED INCOME FUNDS — 3.8% | |||
Diversified Bond Fund | |||
Investor Class | 527,307 | 5,541,997 | |
MONEY MARKET FUNDS — 0.9% | |||
Prime Money Market Fund | |||
Investor Class | 1,360,744 | 1,360,744 | |
TOTAL INVESTMENT | |||
SECURITIES — 100.0% | |||
(Cost $175,062,460) | 146,096,707 | ||
OTHER ASSETS AND LIABILITIES(3) | (997) | ||
TOTAL NET ASSETS — 100.0% | $146,095,710 | ||
Notes to Schedule of Investments | |||
(1) | Investments are funds within the American Century Investments | ||
family of funds, of which certain funds may be deemed to be under | |||
common control because of the same board of directors. | |||
(2) | Non-income producing. | ||
(3) | Category is less than 0.05% of total net assets. |
See Notes to Financial Statements.
16
Statement of Assets and Liabilities |
JULY 31, 2009 | |||
Very Conservative | Conservative | Moderate | |
Assets | |||
Investment securities in affiliates, at value (cost of | |||
$111,610,273, $263,749,917 and $604,247,143, respectively) | $114,705,958 | $252,418,126 | $542,209,452 |
Cash | 63 | 63 | 174 |
Receivable for capital shares sold | 208,430 | 350,257 | 516,515 |
Distributions receivable from affiliates | 109,703 | 219,699 | 390,370 |
115,024,154 | 252,988,145 | 543,116,511 | |
Liabilities | |||
Payable for investments purchased | 55,260 | 421,760 | 735,500 |
Payable for capital shares redeemed | 269,937 | 162,521 | 198,650 |
325,197 | 584,281 | 934,150 | |
Net Assets | $114,698,957 | $252,403,864 | $542,182,361 |
Investor Class Capital Shares, $0.01 Par Value | |||
Outstanding | 11,613,605 | 26,054,873 | 56,183,205 |
Net Asset Value Per Share | $9.88 | $9.69 | $9.65 |
Net Assets Consist of: | |||
Capital (par value and paid-in surplus) | $119,020,381 | $285,863,925 | $659,316,943 |
Undistributed net investment income | 138,543 | 277,398 | 483,499 |
Accumulated net realized loss on investment transactions | (7,555,652) | (22,405,668) | (55,580,390) |
Net unrealized appreciation (depreciation) on investments | 3,095,685 | (11,331,791) | (62,037,691) |
$114,698,957 | $252,403,864 | $542,182,361 | |
See Notes to Financial Statements. |
17
JULY 31, 2009 | ||
Aggressive | Very Aggressive | |
Assets | ||
Investment securities in affiliates, at value | ||
(cost of $406,816,870 and $175,062,460, respectively) | $351,103,623 | $146,096,707 |
Cash | 1,580 | 59 |
Receivable for capital shares sold | 550,533 | 188,791 |
Distributions receivable from affiliates | 219,322 | 15,936 |
351,875,058 | 146,301,493 | |
Liabilities | ||
Payable for investments purchased | 392,359 | 186,202 |
Payable for capital shares redeemed | 393,853 | 19,581 |
786,212 | 205,783 | |
Net Assets | $351,088,846 | $146,095,710 |
Investor Class Capital Shares, $0.01 Par Value | ||
Outstanding | 36,505,350 | 15,601,365 |
Net Asset Value Per Share | $9.62 | $9.36 |
Net Assets Consist of: | ||
Capital (par value and paid-in surplus) | $439,444,643 | $192,962,152 |
Undistributed net investment income | 2,588,550 | 626,280 |
Accumulated net realized loss on investment transactions | (35,231,100) | (18,526,969) |
Net unrealized depreciation on investments | (55,713,247) | (28,965,753) |
$351,088,846 | $146,095,710 | |
See Notes to Financial Statements. |
18
Statement of Operations |
YEAR ENDED JULY 31, 2009 | |||
Very Conservative | Conservative | Moderate | |
Investment Income (Loss) | |||
Income: | |||
Income distributions from underlying funds — affiliates | $ 2,965,422 | $ 7,482,147 | $ 13,395,839 |
Expenses: | |||
Directors’ fees and expenses | 3,402 | 8,798 | 18,898 |
Net investment income (loss) | 2,962,020 | 7,473,349 | 13,376,941 |
Net Realized and Unrealized Gain (Loss) on Affiliates | |||
Net realized gain (loss) on: | |||
Sale of investments in underlying funds | (7,212,421) | (21,455,039) | (52,648,228) |
Capital gain distributions received from underlying funds | 348,402 | 975,187 | 1,570,883 |
(6,864,019) | (20,479,852) | (51,077,345) | |
Change in net unrealized appreciation (depreciation) | |||
on investments in underlying funds | 4,009,013 | (6,276,066) | (45,261,904) |
Net realized and unrealized gain (loss) on affiliates | (2,855,006) | (26,755,918) | (96,339,249) |
Net Increase (Decrease) in Net Assets | |||
Resulting from Operations | $ 107,014 | $(19,282,569) | $(82,962,308) |
See Notes to Financial Statements. |
19
YEAR ENDED JULY 31, 2009 | ||
Aggressive | Very Aggressive | |
Investment Income (Loss) | ||
Income: | ||
Income distributions from underlying funds - affiliates | $ 6,830,612 | $ 1,951,406 |
Expenses: | ||
Directors’ fees and expenses | 11,956 | 4,904 |
Net investment income (loss) | 6,818,656 | 1,946,502 |
Net Realized and Unrealized Gain (Loss) on Affiliates | ||
Net realized gain (loss) on: | ||
Sale of investments in underlying funds | (32,678,451) | (16,553,987) |
Capital gain distributions received from underlying funds | 734,298 | 242,903 |
(31,944,153) | (16,311,084) | |
Change in net unrealized appreciation (depreciation) | ||
on investments in underlying funds | (50,610,667) | (25,530,622) |
Net realized and unrealized gain (loss) on affiliates | (82,554,820) | (41,841,706) |
Net Increase (Decrease) in Net Assets Resulting from Operations | $(75,736,164) | $(39,895,204) |
See Notes to Financial Statements. |
20
Statement of Changes in Net Assets |
YEARS ENDED JULY 31, 2009 AND JULY 31, 2008 | ||||
Very Conservative | Conservative | |||
Increase (Decrease) in Net Assets | 2009 | 2008 | 2009 | 2008 |
Operations | ||||
Net investment income (loss) | $ 2,962,020 | $ 2,478,125 | $ 7,473,349 | $ 10,153,312 |
Net realized gain (loss) | (6,864,019) | 79,690 | (20,479,852) | 3,830,386 |
Change in net unrealized | ||||
appreciation (depreciation) | 4,009,013 | (1,636,979) | (6,276,066) | (14,808,867) |
Net increase (decrease) in net assets | ||||
resulting from operations | 107,014 | 920,836 | (19,282,569) | (825,169) |
Distributions to Shareholders | ||||
From net investment income | (3,036,159) | (2,410,671) | (7,787,898) | (10,130,613) |
From net realized gains | (540,084) | (190,807) | (5,048,736) | (1,699,068) |
Decrease in net assets from distributions | (3,576,243) | (2,601,478) | (12,836,634) | (11,829,681) |
Capital Share Transactions | ||||
Proceeds from shares sold | 83,855,930 | 61,070,373 | 71,600,317 | 124,622,410 |
Proceeds from reinvestment of distributions | 3,477,111 | 2,523,121 | 12,604,341 | 11,587,346 |
Payments for shares redeemed | (53,766,219) | (18,294,303) | (82,757,201) | (68,308,853) |
Net increase (decrease) in net assets | ||||
from capital share transactions | 33,566,822 | 45,299,191 | 1,447,457 | 67,900,903 |
Net increase (decrease) in net assets | 30,097,593 | 43,618,549 | (30,671,746) | 55,246,053 |
Net Assets | ||||
Beginning of period | 84,601,364 | 40,982,815 | 283,075,610 | 227,829,557 |
End of period | $114,698,957 | $84,601,364 | $252,403,864 | $283,075,610 |
Undistributed net investment income | $138,543 | $214,156 | $277,398 | $596,276 |
Transactions in Shares of the Fund | ||||
Sold | 8,786,463 | 5,778,020 | 7,629,234 | 11,004,414 |
Issued in reinvestment of distributions | 363,375 | 240,759 | 1,364,932 | 1,027,071 |
Redeemed | (5,700,965) | (1,737,192) | (8,928,048) | (6,066,675) |
Net increase (decrease) in shares | ||||
of the fund | 3,448,873 | 4,281,587 | 66,118 | 5,964,810 |
See Notes to Financial Statements. |
21
YEARS ENDED JULY 31, 2009 AND JULY 31, 2008 | ||||
Moderate | Aggressive | |||
Increase (Decrease) in Net Assets | 2009 | 2008 | 2009 | 2008 |
Operations | ||||
Net investment income (loss) | $ 13,376,941 | $ 22,149,221 | $ 6,818,656 | $ 13,192,478 |
Net realized gain (loss) | (51,077,345) | 17,144,180 | (31,944,153) | 13,994,819 |
Change in net unrealized | ||||
appreciation (depreciation) | (45,261,904) | (57,887,670) | (50,610,667) | (46,739,387) |
Net increase (decrease) in net assets | ||||
resulting from operations | (82,962,308) | (18,594,269) | (75,736,164) | (19,552,090) |
Distributions to Shareholders | ||||
From net investment income | (13,912,448) | (22,191,149) | (7,877,338) | (12,099,339) |
From net realized gains | (19,257,364) | (7,139,825) | (15,603,260) | (5,382,224) |
Decrease in net assets from distributions | (33,169,812) | (29,330,974) | (23,480,598) | (17,481,563) |
Capital Share Transactions | ||||
Proceeds from shares sold | 106,420,172 | 217,735,355 | 74,594,664 | 132,300,578 |
Proceeds from reinvestment of distributions | 32,565,961 | 28,522,524 | 23,214,995 | 17,179,195 |
Payments for shares redeemed | (132,504,961) | (132,875,879) | (73,590,633) | (83,381,419) |
Net increase (decrease) in net assets | ||||
from capital share transactions | 6,481,172 | 113,382,000 | 24,219,026 | 66,098,354 |
Net increase (decrease) in net assets | (109,650,948) | 65,456,757 | (74,997,736) | 29,064,701 |
Net Assets | ||||
Beginning of period | 651,833,309 | 586,376,552 | 426,086,582 | 397,021,881 |
End of period | $542,182,361 | $651,833,309 | $351,088,846 | $426,086,582 |
Undistributed net investment income | $483,499 | $1,030,622 | $2,588,550 | $3,653,169 |
Transactions in Shares of the Fund | ||||
Sold | 11,410,931 | 17,467,088 | 8,103,219 | 9,774,368 |
Issued in reinvestment of distributions | 3,652,095 | 2,286,713 | 2,770,280 | 1,248,488 |
Redeemed | (14,468,114) | (10,763,714) | (8,142,991) | (6,239,855) |
Net increase (decrease) in shares | ||||
of the fund | 594,912 | 8,990,087 | 2,730,508 | 4,783,001 |
See Notes to Financial Statements.
22
YEARS ENDED JULY 31, 2009 AND JULY 31, 2008 | ||
Very Aggressive | ||
Increase (Decrease) in Net Assets | 2009 | 2008 |
Operations | ||
Net investment income (loss) | $ 1,946,502 | $ 4,662,990 |
Net realized gain (loss) | (16,311,084) | 6,374,361 |
Change in net unrealized appreciation (depreciation) | (25,530,622) | (24,701,859) |
Net increase (decrease) in net assets resulting from operations | (39,895,204) | (13,664,508) |
Distributions to Shareholders | ||
From net investment income | (1,902,034) | (4,620,307) |
From net realized gains | (7,869,388) | (2,398,527) |
Decrease in net assets from distributions | (9,771,422) | (7,018,834) |
Capital Share Transactions | ||
Proceeds from shares sold | 38,191,366 | 70,762,147 |
Proceeds from reinvestment of distributions | 9,521,101 | 6,950,948 |
Payments for shares redeemed | (33,408,768) | (44,414,955) |
Net increase (decrease) in net assets from capital share transactions | 14,303,699 | 33,298,140 |
Net increase (decrease) in net assets | (35,362,927) | 12,614,798 |
Net Assets | ||
Beginning of period | 181,458,637 | 168,843,839 |
End of period | $146,095,710 | $181,458,637 |
Undistributed net investment income | $626,280 | $585,321 |
Transactions in Shares of the Fund | ||
Sold | 4,345,372 | 4,916,535 |
Issued in reinvestment of distributions | 1,172,550 | 472,854 |
Redeemed | (3,754,950) | (3,134,435) |
Net increase (decrease) in shares of the fund | 1,762,972 | 2,254,954 |
See Notes to Financial Statements.
23
Notes to Financial Statements |
JULY 31, 2009
1. Organization and Summary of Significant Accounting Policies
Organization — American Century Asset Allocation Portfolios, Inc. (the corporation) is registered under the Investment Company Act of 1940 (the 1940 Act), as amended, as an open-end management investment company. One Choice Portfolio: Very Conservative (Very Conservative), One Choice Portfolio: Conservative (Conservative), One Choice Portfolio: Moderate (Moderate), One Choice Portfolio: Aggressive (Aggressive), and One Choice Portfolio: Very Aggressive (Very Aggressive) (collectively, the funds) are five funds in a series issued by the corporation. The funds operate as “fund of funds,” meaning that substantially all of the funds’ assets will be invested in other funds in the American Century Investments family of funds (the underlying funds). The funds are diversified under the 1940 Act. Additionally, the underlying funds ar e generally diversified and so indirectly provide broad exposure to a large number of securities. The funds’ investment objectives are to seek the highest total return consistent with their respective asset mix. The funds pursue their objectives by investing in underlying funds that represent a variety of asset classes and investment styles. Generally, more conservative funds emphasize investments in bonds and cash equivalents while more aggressive funds emphasize investments in stocks. The corporation is authorized to issue 3,000,000,000 shares. The following is a summary of the funds’ significant accounting policies.
Underlying Funds — Each fund’s assets are allocated among underlying funds that represent major asset classes, including equity securities (stocks), fixed-income securities (bonds) and cash-equivalent instruments (money markets). A brief description of each of the underlying funds follows.
Domestic Equity Funds
Equity Growth Fund seeks long-term capital growth. It uses a quantitative investment strategy to construct an optimized portfolio drawn primarily from large publicly traded U.S. companies without regard to dividend yield.
Growth Fund seeks long-term capital growth. It uses a growth investment strategy and generally invests in larger U.S. companies.
Large Company Value Fund seeks long-term capital growth with income as a secondary objective. It uses a value investment strategy and invests primarily in larger U.S. companies.
Real Estate Fund seeks high total investment return through a combination of capital appreciation and current income. It invests primarily in equity securities issued by real estate investment trusts and companies engaged in the real estate industry.
Small Company Fund seeks long-term capital growth. It uses a quantitative investment strategy and invests primarily in smaller U.S. companies.
Value Fund seeks long-term capital growth with income as a secondary objective. It uses a value investment strategy and invests primarily in U.S. companies of all sizes.
Vista Fund seeks long-term capital growth. It uses a growth investment strategy and generally invests in medium-sized and smaller U.S. companies.
International Equity Funds
Emerging Markets Fund seeks capital growth. It uses a growth investment strategy and invests primarily in securities of companies located in emerging market countries.
International Growth Fund seeks capital growth. It uses a growth investment strategy and invests primarily in securities of companies located in developed countries other than the United States.
24
Domestic Fixed Income Funds
Diversified Bond Fund seeks a high level of income by investing primarily in high- and medium-grade, non-money market debt securities. These securities, which may be payable in U.S. or foreign currencies, may include corporate bonds and notes, government securities and securities backed by mortgages or other assets.
High-Yield Fund seeks high current income by investing in a diversified portfolio of high-yield corporate bonds and other debt securities. As a secondary objective, the fund seeks capital appreciation, but only when consistent with its primary objective of maximizing current income.
Inflation-Adjusted Bond Fund seeks to provide total return and inflation protection consistent with investment in inflation-indexed securities.
International Fixed Income Funds
International Bond Fund seeks high total return by investing in high-quality, non-dollar-denominated government and corporate debt securities issued outside the United States.
Money Market Funds
Prime Money Market Fund seeks to earn the highest level of current income while preserving the value of shareholder investments by investing in high-quality, cash-equivalent securities.
Security Valuations — Investments in the underlying funds are valued at their reported net asset value. The underlying funds have specific valuation policies. If an event occurs after the value of a security was established but before the net asset value per share of an underlying fund was determined that was likely to materially change the net asset value of the underlying fund, that security would be valued as determined in accordance with procedures adopted by the Board of Directors/Trustees. If the underlying fund determines that the market price of a portfolio security is not readily available, or that the valuation methods mentioned above do not reflect the security’s fair value, such security is valued as determined by the Board of Directors/Trustees or its designee, in accordance with procedures adopted by the Board of Di rectors/Trustees, if such determination would materially impact an underlying fund’s net asset value. Certain other circumstances may cause the underlying fund to use alternative procedures to value a security such as: a security has been declared in default; trading in a security has been halted during the trading day; or there is a foreign market holiday and no trading will commence.
Security Transactions — For financial reporting purposes, security transactions are accounted for as of the trade date. Net realized gains and losses are determined on the identified cost basis, which is also used for federal income tax purposes.
Investment Income — Income and capital gain distributions, if any, from the underlying funds are recorded as of the ex-dividend date. Long-term capital gain distributions, if any, from the underlying funds are a component of net realized gain (loss).
Income Tax Status — It is each fund’s policy to distribute substantially all net investment income and net realized gains to shareholders and to otherwise qualify as a regulated investment company under provisions of the Internal Revenue Code. All tax years for the funds remain subject to examination by tax authorities. At this time, management believes there are no uncertain tax positions which, based on their technical merit, would not be sustained upon examination and for which it is reasonably possible that the total amounts of unrecognized tax benefits will significantly change in the next twelve months. Accordingly, no provision has been made for federal or state income taxes. Interest and penalties associated with any federal or state income tax obligations, if any, are recorded as interest expense.
25
Distributions to Shareholders — Distributions to shareholders are recorded on the ex-dividend date. Distributions from net investment income, if any, are generally declared and paid quarterly for Very Conservative, Conservative, and Moderate. Distributions from net investment income, if any, are generally declared and paid annually for Aggressive and Very Aggressive. Distributions from net realized gains, if any, are generally declared and paid annually for all funds.
Indemnifications — Under the corporation’s organizational documents, its officers and directors are indemnified against certain liabilities arising out of the performance of their duties to the funds. In addition, in the normal course of business, the funds enter into contracts that provide general indemnifications. The maximum exposure under these arrangements is unknown as this would involve future claims that may be made against a fund. The risk of material loss from such claims is considered by management to be remote.
Use of Estimates — The financial statements are prepared in conformity with accounting principles generally accepted in the United States of America, which may require management to make certain estimates and assumptions at the date of the financial statements. Actual results could differ from these estimates.
Subsequent Events — Management has evaluated events or transactions that may have occurred since July 31, 2009, that would merit recognition or disclosure in the financial statements. This evaluation was completed through September 28, 2009, the date the financial statements were issued.
2. Fees and Transactions with Related Parties
Management Fees — The corporation’s investment advisor, American Century Investment Management, Inc. (ACIM), does not receive an administrative fee for services provided to the funds. Each fund will indirectly realize its pro rata share of the fees and expenses of the underlying funds in which it invests. These fees and expenses are already reflected in the valuation of the underlying funds.
Related Parties — Certain officers and directors of the corporation are also officers and/ or directors, and, as a group, controlling stockholders of American Century Companies, Inc. (ACC), the parent of the corporation’s investment advisor, ACIM, the distributor of the corporation, American Century Investment Services, Inc., and the corporation’s transfer agent, American Century Services, LLC. The directors of the corporation are also directors of some underlying funds and therefore those underlying funds may be deemed to be under common control with the corporation. The officers of the corporation are also officers of all the underlying funds. ACIM or American Century Global Investment Management, Inc., a wholly-owned subsidiary of ACIM, serves as the investment advisor for the underlying funds.
The funds have a Mutual Funds Services Agreement with J.P. Morgan Investor Services Co. (JPMIS). JPMIS is a wholly owned subsidiary of JPMorgan Chase & Co. (JPM). JPM is an equity investor in ACC.
3. Investment Transactions
Investment transactions for the year ended July 31, 2009, were as follows:
Very Conservative | Conservative | Moderate | Aggressive | Very Aggressive | |
Purchases | $73,344,844 | $96,147,459 | $168,447,822 | $98,290,826 | $37,598,317 |
Sales | $39,833,206 | $98,467,857 | $179,258,659 | $89,536,818 | $30,843,370 |
26
4. Affiliated Company Transactions
Investments are funds within the American Century Investments family of funds, of which certain funds may be deemed to be under common control because of the same board of directors. A summary of transactions for each underlying fund for the year ended July 31, 2009 follows:
July 31, 2008 | July 31, 2009 | ||||||
Fund/ | Share | Purchase | Sales | Realized | Distributions | Share | Market |
Underlying Fund | Balance | Cost | Cost | Gain (Loss) | Received(1) | Balance | Value |
One Choice Portfolio: Very Conservative | |||||||
Diversified Bond Fund | |||||||
Investor Class | 3,366,876 | $21,667,274 | $19,907,621 | $ (292,942) | $1,855,000 | 3,562,353 | $ 37,440,330 |
Inflation-Adjusted Bond | |||||||
Fund Investor Class | — | 11,254,027 | 79,133 | (146) | — | 1,018,564 | 11,346,803 |
Equity Growth Fund | |||||||
Investor Class | 177,467 | 3,914,495 | 2,458,549 | (904,775) | 87,254 | 329,231 | 5,429,019 |
Growth Fund | |||||||
Investor Class | 108,101 | 2,450,119 | 1,522,045 | (473,513) | 13,322 | 187,385 | 3,624,026 |
Large Company Value | |||||||
Fund Investor Class | 1,083,408 | 6,774,057 | 5,229,132 | (2,172,534) | 331,225 | 1,967,444 | 8,873,172 |
Real Estate Fund | |||||||
Investor Class | 85,642 | 2,397,575 | 2,467,274 | (1,400,580) | 70,191 | 213,289 | 2,341,913 |
Small Company Fund | |||||||
Investor Class | 111,321 | 965,424 | 707,372 | (322,039) | 653 | 224,824 | 1,234,284 |
Value Fund | |||||||
Investor Class | 764,986 | 3,660,113 | 2,715,543 | (1,041,292) | 136,528 | 1,233,424 | 5,686,085 |
Vista Fund | |||||||
Investor Class(2) | 67,551 | 1,375,825 | 726,954 | (308,283) | — | 145,440 | 1,767,096 |
Prime Money Market | |||||||
Fund Investor Class | 20,791,066 | 13,451,626 | 8,818,955 | — | 349,073 | 25,423,737 | 25,423,737 |
International Bond Fund | |||||||
Investor Class | 545,520 | 5,434,309 | 2,413,049 | (296,317) | 470,578 | 779,169 | 11,539,493 |
$73,344,844 | $47,045,627 | $(7,212,421) | $3,313,824 | $114,705,958 |
(1) | Distributions received includes distributions from net investment income and from capital gains from the underlying funds. |
(2) | Non-income producing. |
27
July 31, 2008 | July 31, 2009 | ||||||
Fund/ | Share | Purchase | Sales | Realized | Distributions | Share | Market |
Underlying Fund | Balance | Cost | Cost | Gain (Loss) | Received(1) | Balance | Value |
One Choice Portfolio: Conservative | |||||||
Equity Growth Fund | |||||||
Investor Class | 1,117,887 | $ 8,516,809 | $ 8,053,310 | $ (2,945,723) | $ 432,348 | 1,349,108 | $ 22,246,791 |
Growth Fund | |||||||
Investor Class | 630,845 | 4,631,458 | 4,471,239 | (1,267,471) | 59,914 | 711,829 | 13,766,773 |
Large Company Value | |||||||
Fund Investor Class | 5,059,222 | 11,279,420 | 13,357,415 | (5,508,242) | 1,196,045 | 5,971,111 | 26,929,711 |
Real Estate Fund | |||||||
Investor Class | 285,565 | 3,660,010 | 5,282,033 | (3,207,965) | 177,975 | 461,178 | 5,063,734 |
Small Company Fund | |||||||
Investor Class | 556,933 | 1,888,687 | 1,942,361 | (902,188) | 2,525 | 731,733 | 4,017,214 |
Value Fund | |||||||
Investor Class | 3,490,382 | 4,476,457 | 6,841,233 | (2,812,040) | 480,819 | 3,659,900 | 16,872,139 |
Vista Fund | |||||||
Investor Class(2) | 600,645 | 4,814,244 | 3,077,590 | (1,280,136) | — | 840,146 | 10,207,774 |
Diversified Bond Fund | |||||||
Investor Class | 10,405,102 | 18,713,479 | 50,686,370 | (346,491) | 4,444,684 | 7,262,746 | 76,331,461 |
Inflation-Adjusted Bond | |||||||
Fund Investor Class | — | 21,919,472 | 96,403 | (226) | — | 1,989,202 | 22,159,710 |
International Bond Fund | |||||||
Investor Class | 1,455,057 | 3,687,692 | 5,223,450 | (299,053) | 1,062,961 | 1,352,745 | 20,034,153 |
Prime Money Market | |||||||
Fund Investor Class | 27,310,715 | 4,921,832 | 13,440,066 | — | 371,719 | 18,792,481 | 18,792,481 |
International Growth | |||||||
Fund Investor Class | 1,404,203 | 7,637,899 | 7,451,426 | (2,885,504) | 228,344 | 1,803,403 | 15,996,185 |
$96,147,459 | $119,922,896 | $(21,455,039) | $8,457,334 | $252,418,126 |
(1) | Distributions received includes distributions from net investment income and from capital gains from the underlying funds. |
(2) | Non-income producing. |
28
July 31, 2008 | July 31, 2009 | ||||||
Fund/ | Share | Purchase | Sales | Realized | Distributions | Share | Market |
Underlying Fund | Balance | Cost | Cost | Gain (Loss) | Received(1) | Balance | Value |
One Choice Portfolio: Moderate | |||||||
Equity Growth Fund | |||||||
Investor Class | 4,691,102 | $ 21,304,431 | $ 22,710,049 | $ (8,904,061) | $ 1,703,260 | 5,212,157 | $ 85,948,469 |
Growth Fund | |||||||
Investor Class | 2,350,836 | 10,312,348 | 12,166,964 | (3,575,957) | 208,252 | 2,441,838 | 47,225,147 |
Large Company Value | |||||||
Fund Investor Class | 9,973,669 | 13,737,965 | 18,866,299 | (8,164,209) | 2,193,675 | 10,842,635 | 48,900,284 |
Real Estate Fund | |||||||
Investor Class | 656,157 | 6,251,299 | 10,810,382 | (6,580,523) | 362,256 | 976,153 | 10,718,160 |
Small Company Fund | |||||||
Investor Class | 1,708,539 | 3,768,997 | 4,189,091 | (2,023,105) | 7,004 | 2,066,948 | 11,347,544 |
Value Fund | |||||||
Investor Class | 6,177,671 | 4,421,326 | 9,708,365 | (3,915,859) | 791,699 | 5,964,772 | 27,497,599 |
Vista Fund | |||||||
Investor Class(2) | 2,420,599 | 13,647,855 | 8,596,849 | (3,641,826) | — | 3,113,198 | 37,825,356 |
Diversified Bond Fund | |||||||
Investor Class | 16,394,956 | 23,566,690 | 83,698,582 | (507,487) | 6,537,499 | 10,433,340 | 109,654,403 |
High-Yield Fund | |||||||
Investor Class | 2,231,525 | 1,653,689 | 3,516,453 | (794,421) | 836,386 | 1,999,943 | 10,899,689 |
Inflation-Adjusted Bond | |||||||
Fund Investor Class | — | 30,942,595 | 94,774 | (454) | — | 2,811,911 | 31,324,689 |
Emerging Markets Fund | |||||||
Investor Class | 2,892,755 | 10,387,287 | 13,211,279 | (6,251,427) | 114,181 | 3,599,521 | 22,748,973 |
International Growth | |||||||
Fund Investor Class | 5,387,461 | 19,955,292 | 20,319,078 | (8,053,523) | 828,408 | 6,367,747 | 56,481,916 |
Prime Money Market | |||||||
Fund Investor Class | 38,694,460 | 5,614,160 | 18,601,536 | — | 498,233 | 25,707,084 | 25,707,084 |
International Bond Fund | |||||||
Investor Class | 1,256,612 | 2,883,888 | 5,417,186 | (235,376) | 885,869 | 1,075,634 | 15,930,139 |
$168,447,822 | $231,906,887 | $(52,648,228) | $14,966,722 | $542,209,452 |
(1) | Distributions received includes distributions from net investment income and from capital gains from the underlying funds. |
(2) | Non-income producing. |
29
July 31, 2008 | July 31, 2009 | ||||||
Fund/ | Share | Purchase | Sales | Realized | Distributions | Share | Market |
Underlying Fund | Balance | Cost | Cost | Gain (Loss) | Received(1) | Balance | Value |
One Choice Portfolio: Aggressive | |||||||
Equity Growth Fund | |||||||
Investor Class | 2,770,430 | $ 9,345,904 | $ 9,781,549 | $ (3,930,972) | $ 976,461 | 3,018,599 | $ 49,776,698 |
Growth Fund | |||||||
Investor Class | 2,712,624 | 8,404,535 | 10,215,015 | (3,007,596) | 228,727 | 2,762,658 | 53,429,806 |
Large Company Value | |||||||
Fund Investor Class | 5,795,421 | 5,812,097 | 8,072,187 | (3,518,284) | 1,229,335 | 6,180,538 | 27,874,226 |
Real Estate Fund | |||||||
Investor Class | 428,808 | 3,463,709 | 5,288,063 | (3,366,942) | 243,729 | 625,780 | 6,871,064 |
Small Company Fund | |||||||
Investor Class | 1,256,722 | 2,219,176 | 2,220,470 | (1,085,986) | 5,076 | 1,490,657 | 8,183,707 |
Value Fund | |||||||
Investor Class | 3,433,888 | 2,506,977 | 5,512,446 | (2,008,350) | 427,870 | 3,251,074 | 14,987,451 |
Vista Fund | |||||||
Investor Class(2) | 3,052,797 | 14,943,562 | 8,044,399 | (3,342,875) | — | 3,850,286 | 46,780,975 |
Diversified Bond Fund | |||||||
Investor Class | 6,598,190 | 11,361,957 | 36,072,476 | (180,235) | 2,549,180 | 4,143,713 | 43,550,424 |
High-Yield Fund | |||||||
Investor Class | 2,918,653 | 2,906,098 | 5,853,589 | (1,393,732) | 1,047,994 | 2,565,249 | 13,980,607 |
Inflation-Adjusted Bond | |||||||
Fund Investor Class | — | 13,238,402 | 47,226 | (184) | — | 1,202,474 | 13,395,560 |
Emerging Markets Fund | |||||||
Investor Class | 3,073,841 | 9,709,532 | 12,197,758 | (5,893,600) | 114,708 | 3,750,038 | 23,700,240 |
International Growth | |||||||
Fund Investor Class | 4,403,715 | 12,968,943 | 12,363,338 | (4,949,695) | 636,770 | 5,104,283 | 45,274,990 |
Prime Money Market | |||||||
Fund Investor Class | 8,434,694 | 1,409,934 | 6,546,753 | — | 105,060 | 3,297,875 | 3,297,875 |
$98,290,826 | $122,215,269 | $(32,678,451) | $7,564,910 | $351,103,623 |
(1) | Distributions received includes distributions from net investment income and from capital gains from the underlying funds. |
(2) | Non-income producing. |
30
July 31, 2008 | July 31, 2009 | ||||||
Fund/ | Share | Purchase | Sales | Realized | Distributions | Share | Market |
Underlying Fund | Balance | Cost | Cost | Gain (Loss) | Received(1) | Balance | Value |
One Choice Portfolio: Very Aggressive | |||||||
Equity Growth Fund | |||||||
Investor Class | 1,450,710 | $ 4,924,190 | $ 6,160,865 | $ (2,244,358) | $ 495,163 | 1,535,160 | $ 25,314,788 |
Growth Fund | |||||||
Investor Class | 1,402,637 | 4,228,204 | 6,194,158 | (1,770,181) | 114,594 | 1,386,953 | 26,823,671 |
Large Company Value | |||||||
Fund Investor Class | 3,078,875 | 2,997,375 | 4,587,072 | (1,789,269) | 629,611 | 3,189,968 | 14,386,756 |
Real Estate Fund | |||||||
Investor Class | 182,136 | 1,615,013 | 2,807,588 | (1,545,464) | 94,245 | 258,650 | 2,839,977 |
Small Company Fund | |||||||
Investor Class | 593,391 | 932,429 | 1,017,141 | (439,034) | 2,242 | 683,588 | 3,752,898 |
Value Fund | |||||||
Investor Class | 1,887,777 | 1,543,764 | 3,428,239 | (1,076,937) | 226,258 | 1,736,774 | 8,006,528 |
Vista Fund | |||||||
Investor Class(2) | 1,586,013 | 7,453,476 | 5,265,008 | (2,179,446) | — | 1,943,972 | 23,619,260 |
Emerging Markets Fund | |||||||
Investor Class | 1,507,458 | 4,395,551 | 6,041,399 | (3,000,669) | 52,213 | 1,785,207 | 11,282,508 |
International Growth | |||||||
Fund Investor Class | 2,320,955 | 5,881,497 | 6,088,322 | (2,463,936) | 329,046 | 2,611,903 | 23,167,580 |
Diversified Bond Fund | |||||||
Investor Class | 525,838 | 2,926,883 | 2,883,460 | (44,693) | 207,851 | 527,307 | 5,541,997 |
Prime Money Market | |||||||
Fund Investor Class | 3,584,914 | 699,935 | 2,924,105 | — | 43,086 | 1,360,744 | 1,360,744 |
$37,598,317 | $47,397,357 | $(16,553,987) | $2,194,309 | $146,096,707 |
(1) | Distributions received includes distributions from net investment income and from capital gains from the underlying funds. |
(2) | Non-income producing. |
5. Investments in Underlying Funds
The funds do not invest in the underlying funds for the purpose of exercising management or control; however, investments by the funds within their investment strategies may represent a significant portion of the underlying funds’ net assets.
6. Fair Value Measurements
The funds’ securities valuation process is based on several considerations and may use multiple inputs to determine the fair value of the positions held by the funds. In conformity with accounting principles generally accepted in the United States of America, the inputs used to determine a valuation are classified into three broad levels as follows:
• Level 1 valuation inputs consist of actual quoted prices in an active market for identical securities;
• Level 2 valuation inputs consist of significant direct or indirect observable market data (including quoted prices for similar securities, evaluations of subsequent market events, interest rates, prepayment speeds, credit risk, etc.); or
• Level 3 valuation inputs consist of significant unobservable inputs (including a fund’s own assumptions).
31
The level classification is based on the lowest level input that is significant to the fair valuation measurement. The valuation inputs are not an indication of the risks associated with investing in these securities or other financial instruments.
As of July 31, 2009, the valuation inputs used to determine the fair value of the funds’ securities were classified as Level 1.
7. Risk Factors
Some of the underlying funds invest in foreign securities, which are generally riskier than U.S. securities. As a result, the funds are subject to foreign risk, meaning that political events (such as civil unrest, national elections and imposition of exchange controls), social and economic events (such as labor strikes and rising inflation), and natural disasters occurring in a country where the funds invest could cause the funds’ investments in that country to experience gains or losses. Investing in emerging markets may accentuate these risks.
8. Federal Tax Information
The tax character of distributions paid during the years ended July 31, 2009 and July 31, 2008 were as follows:
Very Conservative | Conservative | |||
2009 | 2008 | 2009 | 2008 | |
Distributions Paid From | ||||
Ordinary income | $3,128,083 | $2,446,681 | $7,790,109 | $10,446,155 |
Long-term capital gains | $448,160 | $154,797 | $5,046,525 | $1,383,526 |
Moderate | Aggressive | |||
2009 | 2008 | 2009 | 2008 | |
Distributions Paid From | ||||
Ordinary income | $13,916,492 | $23,263,119 | $7,878,906 | $12,769,831 |
Long-term capital gains | $19,253,320 | $6,067,855 | $15,601,692 | $4,711,732 |
Very Aggressive | ||||
2009 | 2008 | |||
Distributions Paid From | ||||
Ordinary income | $1,903,399 | $4,847,729 | ||
Long-term capital gains | $7,868,023 | $2,171,105 |
The book-basis character of distributions made during the year from net investment income or net realized gains may differ from their ultimate characterization for federal income tax purposes. These differences reflect the differing character of certain income items and net realized gains and losses for financial statement and tax purposes, and may result in reclassification among certain capital accounts on the financial statements.
32
As of July 31, 2009, the components of distributable earnings on a tax-basis and the federal tax cost of investments were as follows:
Very Conservative | Conservative | Moderate | Aggressive | Very Aggressive | |
Federal tax cost | |||||
of investments | $119,091,949 | $283,335,911 | $648,886,970 | $435,615,621 | $188,853,462 |
Gross tax appreciation | |||||
of investments | — | $ 1,145,053 | $ 3,558,696 | $ 1,361,840 | $ 115,662 |
Gross tax depreciation | |||||
of investments | $(4,385,991) | (32,062,838) | (110,236,214) | (85,873,838) | (42,872,417) |
Net tax appreciation | |||||
(depreciation) | |||||
of investments | $(4,385,991) | $(30,917,785) | $(106,677,518) | $(84,511,998) | $(42,756,755) |
Undistributed | |||||
ordinary income | $138,543 | $277,398 | $483,499 | $2,588,550 | $626,280 |
Accumulated | |||||
capital losses | — | $(685,394) | $(3,239,053) | $(2,141,306) | $(2,321,712) |
Capital loss deferrals | $(73,976) | $(2,134,280) | $(7,701,510) | $(4,291,043) | $(2,414,255) |
The difference between book-basis and tax-basis cost and unrealized appreciation (depreciation) is attributable primarily to the tax deferral of losses on wash sales.
The accumulated capital losses listed above represent net capital loss carryovers that may be used to offset future realized capital gains for federal income tax purposes. Future capital loss carryover utilization in any given year may be limited due to large shareholder redemptions and contributions. The capital loss carryovers expire in 2017.
The capital loss deferrals listed above represent net capital losses incurred in the nine-month period ended July 31, 2009. The funds have elected to treat such losses as having been incurred in the following fiscal year for federal income tax purposes.
9. Recently Issued Accounting Standards
The Financial Accounting Standards Board (FASB) issued Statement of Financial Accounting Standards No. 157, “Fair Value Measurements” (FAS 157), in September 2006, which is effective for fiscal years beginning after November 15, 2007. FAS 157 defines fair value, establishes a framework for measuring fair value and expands the required financial statement disclosures about fair value measurements. The adoption of FAS 157 did not materially impact the determination of fair value.
In March 2008, the FASB issued Statement of Financial Accounting Standards No. 161, “Disclosures about Derivative Instruments and Hedging Activities — an amendment of FASB Statement No. 133” (FAS 161). FAS 161 is effective for interim periods beginning after November 15, 2008 and has been adopted by the funds. FAS 161 amends and expands disclosures about derivative instruments and hedging activities. FAS 161 requires qualitative disclosures about the objectives and strategies of derivative instruments, quantitative disclosures about the fair value amounts of and gains and losses on derivative instruments, and disclosures of credit-risk-related contingent features in hedging activities.
33
10. Other Tax Information (Unaudited)
The following information is provided pursuant to provisions of the Internal Revenue Code.
The funds hereby designate up to the maximum amount allowable as qualified dividend income for the fiscal year ended July 31, 2009.
For corporate taxpayers, the funds hereby designate the following ordinary income distributions, or up to the maximum amount allowable, as qualified for the corporate dividends received deduction for the fiscal year ended July 31, 2009.
Very Conservative | Conservative | Moderate | Aggressive | Very Aggressive |
$754,433 | $2,347,489 | $5,161,873 | $6,091,400 | $1,833,298 |
The funds hereby designate the following long-term capital gain distributions, or up to the | ||||
maximum amount allowable, for the fiscal year ended July 31, 2009. | ||||
Very Conservative | Conservative | Moderate | Aggressive | Very Aggressive |
$448,160 | $5,046,525 | $19,253,320 | $15,601,692 | $7,868,023 |
The funds hereby designate the following distributions as qualified short-term capital | ||||
gains for purposes of Internal Revenue Code Section 871. | ||||
Very Conservative | Conservative | Moderate | Aggressive | Very Aggressive |
$90,948 | — | — | — | — |
34
Financial Highlights |
One Choice Portfolio: Very Conservative | |||||
Investor Class | |||||
For a Share Outstanding Throughout the Years Ended July 31 (except as noted) | |||||
2009 | 2008 | 2007 | 2006 | 2005(1) | |
Per-Share Data | |||||
Net Asset Value, Beginning of Period | $10.36 | $10.55 | $10.23 | $10.27 | $10.00 |
Income From Investment Operations | |||||
Net Investment Income (Loss)(2) | 0.30 | 0.43 | 0.40 | 0.37 | 0.25 |
Net Realized and Unrealized Gain (Loss) | (0.40) | (0.12) | 0.33 | (0.04) | 0.29 |
Total From Investment Operations | (0.10) | 0.31 | 0.73 | 0.33 | 0.54 |
Distributions | |||||
From Net Investment Income | (0.32) | (0.46) | (0.39) | (0.36) | (0.27) |
From Net Realized Gains | (0.06) | (0.04) | (0.02) | (0.01) | — |
Total Distributions | (0.38) | (0.50) | (0.41) | (0.37) | (0.27) |
Net Asset Value, End of Period | $9.88 | $10.36 | $10.55 | $10.23 | $10.27 |
Total Return(3) | (0.87)% | 2.91% | 7.23% | 3.27% | 5.43% |
Ratios/Supplemental Data | |||||
Ratio of Operating Expenses | |||||
to Average Net Assets(4) | 0.00% | 0.00% | 0.00% | 0.00% | 0.00%(5) |
Ratio of Net Investment Income (Loss) | |||||
to Average Net Assets | 3.13% | 4.06% | 3.83% | 3.67% | 3.00%(5) |
Portfolio Turnover Rate | 42% | 17% | 17% | 34% | 38% |
Net Assets, End of Period (in thousands) | $114,699 | $84,601 | $40,983 | $19,852 | $10,132 |
(1) | September 30, 2004 (fund inception) through July 31, 2005. |
(2) | Computed using average shares outstanding throughout the period. |
(3) | Total return assumes reinvestment of net investment income and capital gains distributions, if any. Total returns for periods less than one year are not annualized. |
(4) | Ratio of operating expenses to average net assets does not include any expenses of the underlying funds. Other expenses, which include the fees and expenses of the fund’s independent directors and its legal counsel, as well as interest, did not exceed 0.005%. |
(5) | Annualized. |
See Notes to Financial Statements.
35
One Choice Portfolio: Conservative | |||||
Investor Class | |||||
For a Share Outstanding Throughout the Years Ended July 31 (except as noted) | |||||
2009 | 2008 | 2007 | 2006 | 2005(1) | |
Per-Share Data | |||||
Net Asset Value, Beginning of Period | $10.89 | $11.38 | $10.66 | $10.54 | $10.00 |
Income From Investment Operations | |||||
Net Investment Income (Loss)(2) | 0.29 | 0.44 | 0.35 | 0.34 | 0.22 |
Net Realized and Unrealized Gain (Loss) | (0.98) | (0.40) | 0.75 | 0.12 | 0.58 |
Total From Investment Operations | (0.69) | 0.04 | 1.10 | 0.46 | 0.80 |
Distributions | |||||
From Net Investment Income | (0.31) | (0.45) | (0.35) | (0.33) | (0.26) |
From Net Realized Gains | (0.20) | (0.08) | (0.03) | (0.01) | — |
Total Distributions | (0.51) | (0.53) | (0.38) | (0.34) | (0.26) |
Net Asset Value, End of Period | $9.69 | $10.89 | $11.38 | $10.66 | $10.54 |
Total Return(3) | (6.05)% | 0.18% | 10.41% | 4.45% | 8.08% |
Ratios/Supplemental Data | |||||
Ratio of Operating Expenses | |||||
to Average Net Assets(4) | 0.00% | 0.00% | 0.00% | 0.00% | 0.00%(5) |
Ratio of Net Investment Income (Loss) | |||||
to Average Net Assets | 3.13% | 3.85% | 3.14% | 3.23% | 2.63%(5) |
Portfolio Turnover Rate | 40% | 18% | 7% | 8% | 12% |
Net Assets, End of Period (in thousands) | $252,404 | $283,076 | $227,830 | $110,384 | $43,183 |
(1) | September 30, 2004 (fund inception) through July 31, 2005. |
(2) | Computed using average shares outstanding throughout the period. |
(3) | Total return assumes reinvestment of net investment income and capital gains distributions, if any. Total returns for periods less than one year are not annualized. |
(4) | Ratio of operating expenses to average net assets does not include any expenses of the underlying funds. Other expenses, which include the fees and expenses of the fund’s independent directors and its legal counsel, as well as interest, did not exceed 0.005%. |
(5) | Annualized. |
See Notes to Financial Statements.
36
One Choice Portfolio: Moderate | |||||
Investor Class | |||||
For a Share Outstanding Throughout the Years Ended July 31 (except as noted) | |||||
2009 | 2008 | 2007 | 2006 | 2005(1) | |
Per-Share Data | |||||
Net Asset Value, Beginning of Period | $11.73 | $12.58 | $11.34 | $10.97 | $10.00 |
Income From Investment Operations | |||||
Net Investment Income (Loss)(2) | 0.24 | 0.43 | 0.35 | 0.34 | 0.17 |
Net Realized and Unrealized Gain (Loss) | (1.70) | (0.70) | 1.29 | 0.38 | 0.99 |
Total From Investment Operations | (1.46) | (0.27) | 1.64 | 0.72 | 1.16 |
Distributions | |||||
From Net Investment Income | (0.26) | (0.44) | (0.35) | (0.34) | (0.19) |
From Net Realized Gains | (0.36) | (0.14) | (0.05) | (0.01) | — |
Total Distributions | (0.62) | (0.58) | (0.40) | (0.35) | (0.19) |
Net Asset Value, End of Period | $9.65 | $11.73 | $12.58 | $11.34 | $10.97 |
Total Return(3) | (11.94)% | (2.37)% | 14.56% | 6.68% | 11.71% |
Ratios/Supplemental Data | |||||
Ratio of Operating Expenses | |||||
to Average Net Assets(4) | 0.00% | 0.00% | 0.00% | 0.00% | 0.00%(5) |
Ratio of Net Investment Income (Loss) | |||||
to Average Net Assets | 2.63% | 3.44% | 2.85% | 3.02% | 1.98%(5) |
Portfolio Turnover Rate | 32% | 18% | 7% | 7% | 3% |
Net Assets, End of Period (in thousands) | $542,182 | $651,833 | $586,377 | $253,610 | $97,313 |
(1) | September 30, 2004 (fund inception) through July 31, 2005. |
(2) | Computed using average shares outstanding throughout the period. |
(3) | Total return assumes reinvestment of net investment income and capital gains distributions, if any. Total returns for periods less than one year are not annualized. |
(4) | Ratio of operating expenses to average net assets does not include any expenses of the underlying funds. Other expenses, which include the fees and expenses of the fund’s independent directors and its legal counsel, as well as interest, did not exceed 0.005%. |
(5) | Annualized. |
See Notes to Financial Statements.
37
One Choice Portfolio: Aggressive | |||||
Investor Class | |||||
For a Share Outstanding Throughout the Years Ended July 31 (except as noted) | |||||
2009 | 2008 | 2007 | 2006 | 2005(1) | |
Per-Share Data | |||||
Net Asset Value, Beginning of Period | $12.62 | $13.69 | $11.83 | $11.26 | $10.00 |
Income From Investment Operations | |||||
Net Investment Income (Loss)(2) | 0.20 | 0.41 | 0.32 | 0.31 | 0.14 |
Net Realized and Unrealized Gain (Loss) | (2.49) | (0.90) | 1.87 | 0.56 | 1.22 |
Total From Investment Operations | (2.29) | (0.49) | 2.19 | 0.87 | 1.36 |
Distributions | |||||
From Net Investment Income | (0.24) | (0.40) | (0.28) | (0.29) | (0.10) |
From Net Realized Gains | (0.47) | (0.18) | (0.05) | (0.01) | — |
Total Distributions | (0.71) | (0.58) | (0.33) | (0.30) | (0.10) |
Net Asset Value, End of Period | $9.62 | $12.62 | $13.69 | $11.83 | $11.26 |
Total Return(3) | (17.28)% | (3.97)% | 18.78% | 7.84% | 13.61% |
Ratios/Supplemental Data | |||||
Ratio of Operating Expenses | |||||
to Average Net Assets(4) | 0.00% | 0.00% | 0.00% | 0.00% | 0.00%(5) |
Ratio of Net Investment Income (Loss) | |||||
to Average Net Assets | 2.12% | 3.07% | 2.46% | 2.68% | 1.52%(5) |
Portfolio Turnover Rate | 27% | 17% | 7% | 6% | 3% |
Net Assets, End of Period (in thousands) | $351,089 | $426,087 | $397,022 | $191,350 | $64,623 |
(1) | September 30, 2004 (fund inception) through July 31, 2005. |
(2) | Computed using average shares outstanding throughout the period. |
(3) | Total return assumes reinvestment of net investment income and capital gains distributions, if any. Total returns for periods less than one year are not annualized. |
(4) | Ratio of operating expenses to average net assets does not include any expenses of the underlying funds. Other expenses, which include the fees and expenses of the fund’s independent directors and its legal counsel, as well as interest, did not exceed 0.005%. |
(5) | Annualized. |
See Notes to Financial Statements.
38
One Choice Portfolio: Very Aggressive | |||||
Investor Class | |||||
For a Share Outstanding Throughout the Years Ended July 31 (except as noted) | |||||
2009 | 2008 | 2007 | 2006 | 2005(1) | |
Per-Share Data | |||||
Net Asset Value, Beginning of Period | $13.11 | $14.58 | $12.23 | $11.48 | $10.00 |
Income From Investment Operations | |||||
Net Investment Income (Loss)(2) | 0.13 | 0.36 | 0.25 | 0.25 | 0.08 |
Net Realized and Unrealized Gain (Loss) | (3.17) | (1.27) | 2.40 | 0.78 | 1.49 |
Total From Investment Operations | (3.04) | (0.91) | 2.65 | 1.03 | 1.57 |
Distributions | |||||
From Net Investment Income | (0.14) | (0.37) | (0.24) | (0.27) | (0.09) |
From Net Realized Gains | (0.57) | (0.19) | (0.06) | (0.01) | — |
Total Distributions | (0.71) | (0.56) | (0.30) | (0.28) | (0.09) |
Net Asset Value, End of Period | $9.36 | $13.11 | $14.58 | $12.23 | $11.48 |
Total Return(3) | (22.35)% | (6.63)% | 21.87% | 9.00% | 15.81% |
Ratios/Supplemental Data | |||||
Ratio of Operating Expenses | |||||
to Average Net Assets(4) | 0.00% | 0.00% | 0.00% | 0.00% | 0.00%(5) |
Ratio of Net Investment Income (Loss) | |||||
to Average Net Assets | 1.48% | 2.53% | 1.85% | 2.08% | 0.84%(5) |
Portfolio Turnover Rate | 23% | 15% | 8% | 9% | 8% |
Net Assets, End of Period (in thousands) | $146,096 | $181,459 | $168,844 | $77,262 | $25,649 |
(1) | September 30, 2004 (fund inception) through July 31, 2005. |
(2) | Computed using average shares outstanding throughout the period. |
(3) | Total return assumes reinvestment of net investment income and capital gains distributions, if any. Total returns for periods less than one year are not annualized. |
(4) | Ratio of operating expenses to average net assets does not include any expenses of the underlying funds. Other expenses, which include the fees and expenses of the fund’s independent directors and its legal counsel, as well as interest, did not exceed 0.005%. |
(5) | Annualized. |
See Notes to Financial Statements.
39
Report of Independent Registered Public Accounting Firm |
The Board of Directors and Shareholders, American Century Asset Allocation Portfolios, Inc.:
We have audited the accompanying statements of assets and liabilities, including the schedules of investments, of One Choice Portfolio: Very Conservative, One Choice Portfolio: Conservative, One Choice Portfolio: Moderate, One Choice Portfolio: Aggressive and One Choice Portfolio: Very Aggressive, five of the portfolios constituting American Century Asset Allocation Portfolios, Inc. (the “Corporation”), as of July 31, 2009, 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, and the financial highlights for each of the four years in the period then ended and for the period September 30, 2004 (inception of the portfolios) through July 31, 2005. These financial statements and financial highlights are the responsibility of the Corporation’s management. Our responsibility is to express an opinion on these financi al statements and financial highlights based on our audits.
We conducted our audits in accordance with the standards of the Public Company Accounting Oversight Board (United States). 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. The Corporation is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. Our audits included consideration of internal control over financial reporting as a basis for designing audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Corporation’s internal control over financial reporting. Accordingly, we express no such opinion. An audit also includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements, assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. Our procedures included confirmation of securities owned as of July 31, 2009, by correspondence with the transfer agent. We believe that our audits provide a reasonable basis for our opinion.
In our opinion, the financial statements and financial highlights referred to above present fairly, in all material respects, the respective financial positions of One Choice Portfolio: Very Conservative, One Choice Portfolio: Conservative, One Choice Portfolio: Moderate, One Choice Portfolio: Aggressive and One Choice Portfolio: Very Aggressive, five of the portfolios of American Century Asset Allocation Portfolios, Inc., as of July 31, 2009, 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 four years in the period then ended and for the period September 30, 2004 through July 31, 2005, in conformity with accounting principles generally accepted in the United States of America.
Deloitte & Touche LLP
Kansas City, Missouri
September 28, 2009
40
Management |
The individuals listed below serve as directors or officers of the funds. Each director serves until his or her successor is duly elected and qualified or until he or she retires. Mandatory retirement age for independent directors is 72. Those listed as interested directors are “interested” primarily by virtue of their engagement as directors and/or officers of, or ownership interest in, American Century Companies, Inc. (ACC) or its wholly owned, direct or indirect, subsidiaries, including the funds’ investment advisor, American Century Investment Management, Inc. (ACIM); the funds’ principal underwriter, American Century Investment Services, Inc. (ACIS); and the funds’ transfer agent, American Century Services, LLC (ACS).
The other directors (more than three-fourths of the total number) are independent; that is, they have never been employees, directors or officers of, and have no financial interest in, ACC or any of its wholly owned, direct or indirect, subsidiaries, including ACIM, ACIS and ACS. The directors serve in this capacity for seven registered investment companies in the American Century Investments family of funds.
All persons named as officers of the funds also serve in similar capacities for the other 14 registered investment companies in the American Century Investments family of funds advised by ACIM or American Century Global Investment Management, Inc. (ACGIM), a wholly owned subsidiary of ACIM, unless otherwise noted. Only officers with policy-making functions are listed. No officer is compensated for his or her service as an officer of the funds. The listed officers are interested persons of the funds and are appointed or re-appointed on an annual basis.
Interested Directors
James E. Stowers, Jr., 4500 Main Street, Kansas City, MO 64111
Year of Birth: 1924
Position(s) Held with Funds: Director (since 1958) and Vice Chairman (since 2007)
Principal Occupation(s) During Past 5 Years: Founder, Co-Chairman, Director and Controlling
Shareholder, ACC; Co-Vice Chairman, ACC (January 2005 to February 2007);
Chairman, ACC (January 1995 to December 2004); Director, ACIM, ACGIM, ACS,
ACIS and other ACC subsidiaries
Number of Portfolios in Fund Complex Overseen by Director: 63
Other Directorships Held by Director: None
Jonathan S. Thomas, 4500 Main Street, Kansas City, MO 64111
Year of Birth: 1963
Position(s) Held with Funds: Director (since 2007) and President (since 2007)
Principal Occupation(s) During Past 5 Years: President and Chief Executive Officer, ACC
(March 2007 to present); Chief Administrative Officer, ACC (February 2006 to
February 2007); Executive Vice President, ACC (November 2005 to February 2007).
Also serves as: President, Chief Executive Officer and Director, ACS; Executive
Vice President, ACIM and ACGIM; Director, ACIM, ACGIM, ACIS and other ACC
subsidiaries. Managing Director, Morgan Stanley (March 2000 to November 2005)
Number of Portfolios in Fund Complex Overseen by Director: 103
Other Directorships Held by Director: None
41
Independent Directors
Thomas A. Brown, 4500 Main Street, Kansas City, MO 64111
Year of Birth: 1940
Position(s) Held with Funds: Director (since 1980)
Principal Occupation(s) During Past 5 Years: Managing Member, Associated Investments, LLC
(real estate investment company); Managing Member, Brown Cascade Properties,
LLC (real estate investment company); Retired, Area Vice President, Applied
Industrial Technologies (bearings and power transmission company)
Number of Portfolios in Fund Complex Overseen by Director: 63
Other Directorships Held by Director: None
Andrea C. Hall, Ph.D., 4500 Main Street, Kansas City, MO 64111
Year of Birth: 1945
Position(s) Held with Funds: Director (since 1997)
Principal Occupation(s) During Past 5 Years: Retired, Advisor to the President, Midwest
Research Institute (not-for-profit, contract research organization)
Number of Portfolios in Fund Complex Overseen by Director: 63
Other Directorships Held by Director: None
James A. Olson, 4500 Main Street, Kansas City, MO 64111
Year of Birth: 1942
Position(s) Held with Funds: Director (since 2007)
Principal Occupation(s) During Past 5 Years: Member, Plaza Belmont LLC (private equity
fund manager); Chief Financial Officer, Plaza Belmont LLC (September 1999 to
September 2006)
Number of Portfolios in Fund Complex Overseen by Director: 63
Other Directorships Held by Director: Saia, Inc. and Entertainment Properties Trust
Donald H. Pratt, 4500 Main Street, Kansas City, MO 64111
Year of Birth: 1937
Position(s) Held with Funds: Director (since 1995) and Chairman of the Board (since 2005)
Principal Occupation(s) During Past 5 Years: Chairman and Chief Executive Officer, Western
Investments, Inc. (real estate company); Retired Chairman of the Board, Butler
Manufacturing Company (metal buildings producer)
Number of Portfolios in Fund Complex Overseen by Director: 63
Other Directorships Held by Director: None
Gale E. Sayers, 4500 Main Street, Kansas City, MO 64111
Year of Birth: 1943
Position(s) Held with Funds: Director (since 2000)
Principal Occupation(s) During Past 5 Years: President, Chief Executive Officer and Founder,
Sayers40, Inc. (technology products and services provider)
Number of Portfolios in Fund Complex Overseen by Director: 63
Other Directorships Held by Director: None
M. Jeannine Strandjord, 4500 Main Street, Kansas City, MO 64111
Year of Birth: 1945
Position(s) Held with Funds: Director (since 1994)
Principal Occupation(s) During Past 5 Years: Retired, formerly Senior Vice President, Sprint
Corporation (telecommunications company)
Number of Portfolios in Fund Complex Overseen by Director: 63
Other Directorships Held by Director: DST Systems, Inc.; Euronet Worldwide, Inc. and
Charming Shoppes, Inc.
42
John R. Whitten, 4500 Main Street, Kansas City, MO 64111
Year of Birth: 1946
Position(s) Held with Funds: Director (since 2008)
Principal Occupation(s) During Past 5 Years: Project Consultant, Celanese Corp. (industrial
chemical company) (September 2004 to January 2005)
Number of Portfolios in Fund Complex Overseen by Director: 63
Other Directorships Held by Director: Rudolph Technologies, Inc.
Officers
Barry Fink, 4500 Main Street, Kansas City, MO 64111
Year of Birth: 1955
Position(s) Held with Funds: Executive Vice President (since 2007)
Principal Occupation(s) During Past 5 Years: Chief Operating Officer and Executive Vice
President, ACC (September 2007 to present); President, ACS (October 2007 to
present); Managing Director, Morgan Stanley (2000 to 2007); Global General
Counsel, Morgan Stanley (2000 to 2006). Also serves as: Director, ACC, ACS, ACIS
and other ACC subsidiaries
Maryanne Roepke, 4500 Main Street, Kansas City, MO 64111
Year of Birth: 1956
Position(s) Held with Funds: Chief Compliance Officer (since 2006) and Senior Vice
President (since 2000)
Principal Occupation(s) During Past 5 Years: Chief Compliance Officer, ACIM, ACGIM and ACS
(August 2006 to present); Assistant Treasurer, ACC (January 1995 to August 2006);
and Treasurer and Chief Financial Officer, various American Century Investments
funds (July 2000 to August 2006). Also serves as: Senior Vice President, ACS
Charles A. Etherington, 4500 Main Street, Kansas City, MO 64111
Year of Birth: 1957
Position(s) Held with Funds: General Counsel (since 2007) and Senior Vice President
(since 2006)
Principal Occupation(s) During Past 5 Years: Attorney, ACC (February 1994 to present); Vice
President, ACC (November 2005 to present); General Counsel, ACC (March 2007
to present). Also serves as: General Counsel, ACIM, ACGIM, ACS, ACIS and other
ACC subsidiaries; and Senior Vice President, ACIM, ACGIM and ACS
Robert Leach, 4500 Main Street, Kansas City, MO 64111
Year of Birth: 1966
Position(s) Held with Funds: Vice President, Treasurer and Chief Financial Officer (all
since 2006)
Principal Occupation(s) During Past 5 Years: Vice President, ACS (February 2000 to present);
and Controller, various American Century Investments funds (1997 to September 2006)
Jon Zindel, 4500 Main Street, Kansas City, MO 64111
Year of Birth: 1967
Position(s) Held with Funds: Tax Officer (since 1998)
Principal Occupation(s) During Past 5 Years: Chief Financial Officer and Chief Accounting
Officer, ACC (March 2007 to present); Vice President, ACC (October 2001 to
present); Vice President, certain ACC subsidiaries (October 2001 to August 2006);
Vice President, Corporate Tax, ACS (April 1998 to August 2006). Also serves as:
Chief Financial Officer, Chief Accounting Officer and Senior Vice President, ACIM,
ACGIM, ACS and other ACC subsidiaries; and Chief Accounting Officer and Senior
Vice President, ACIS
43
David H. Reinmiller, 4500 Main Street, Kansas City, MO 64111
Year of Birth: 1963
Position(s) Held with Funds: Vice President (since September 2000)
Principal Occupation(s) During Past 5 Years: Attorney, ACC (January 1994 to present);
Associate General Counsel, ACC (January 2001 to present); Chief Compliance
Officer, American Century Investments funds, ACIM and ACGIM (January 2001 to
February 2005). Also serves as: Associate General Counsel, ACIM, ACGIM, ACS,
ACIS and other ACC subsidiaries; and Vice President, ACIM, ACGIM and ACS
Ward Stauffer, 4500 Main Street, Kansas City, MO 64111
Year of Birth: 1960
Position(s) Held with Funds: Secretary (since February 2005)
Principal Occupation(s) During Past 5 Years: Attorney, ACC (June 2003 to present)
The SAI has additional information about the funds’ directors and is available without charge, upon request, by calling 1-800-345-2021.
44
Approval of Management Agreements |
Under Section 15(c) of the Investment Company Act, contracts for investment advisory services are required to be reviewed, evaluated and approved by a majority of a fund’s independent directors (the “Directors”) each year. At American Century Investments, this process is referred to as the “15(c) Process.” As a part of this process, the board reviews fund performance, shareholder services, audit and compliance information, and a variety of other reports from the advisor concerning fund operations. In addition to this annual review, the board of directors oversees and evaluates on a continuous basis at its quarterly meetings the nature and quality of significant services performed by the advisor, fund performance, audit and compliance information, and a variety of other reports relating to fund operations. The board, or committees of the board, also holds special meetings as needed.
Under a Securities and Exchange Commission rule, each fund is required to disclose in its annual or semiannual report, as appropriate, the material factors and conclusions that formed the basis for the board’s approval or renewal of any advisory agreements within the fund’s most recently completed fiscal half-year period.
Annual Contract Review Process
As part of the annual 15(c) Process undertaken during the most recent fiscal half-year period, the Directors reviewed extensive data and information compiled by the advisor and certain independent providers of evaluative data (the “15(c) Providers”) concerning One Choice Portfolio: Very Aggressive, One Choice Portfolio: Aggressive, One Choice Portfolio: Moderate, One Choice Portfolio: Conservative and One Choice Portfolio: Very Conservative (the “Funds”) and the services provided to the Funds under the management agreement. The information considered and the discussions held at the meetings included, but were not limited to:
• the nature, extent and quality of investment management, shareholder services and other services provided to the Funds;
• the wide range of programs and services the advisor provides to the Funds and their shareholders on a routine and non-routine basis;
• the compliance policies, procedures, and regulatory experience of the advisor;
• data comparing the cost of owning the Funds to the cost of owning a similar fund;
• data comparing the Funds’ performance to appropriate benchmarks and/ or a peer group of other mutual funds with similar investment objectives and strategies;
• financial data showing the profitability of the Funds to the advisor and the overall profitability of the advisor;
• data comparing services provided and charges to other investment management clients of the advisor; and
• consideration of collateral benefits derived by the advisor from the management of the Funds and any potential economies of scale relating thereto.
45
In keeping with its practice, the Funds’ board of directors held two in-person meetings and one telephonic meeting to review and discuss the information provided. The board also had the benefit of the advice of its independent counsel throughout the period.
Factors Considered
The Directors considered all of the information provided by the advisor, the 15(c) Providers, and the board’s independent counsel, and evaluated such information for each fund for which the board has responsibility. In connection with their review of the Funds, the Directors did not identify any single factor as being all-important or controlling, and each Director may have attributed different levels of importance to different factors. In deciding to renew the management agreement under the terms ultimately determined by the board to be appropriate, the Directors’ decision was based on the following factors.
Nature, Extent and Quality of Services — Generally. Under the management agreement, the advisor is responsible for providing or arranging for all services necessary for the operation of the Funds. The board noted that under the management agreement, the advisor provides or arranges at its own expense a wide variety of services including:
• Fund construction and design
• portfolio security selection
• initial capitalization/funding
• securities trading
• Fund administration
• custody of Fund assets
• daily valuation of each Fund’s portfolio
• shareholder servicing and transfer agency, including shareholder confirmations, recordkeeping and communications
• legal services
• regulatory and portfolio compliance
• financial reporting
• marketing and distribution
The Directors noted that many of the services provided by the advisor have expanded over time both in terms of quantity and complexity in response to shareholder demands, competition in the industry and the changing regulatory environment. They discussed with the advisor the challenges
46
presented by these changes and the impact on the Funds. In performing their evaluation, the Directors considered information received in connection with the annual review, as well as information provided on an ongoing basis at their regularly scheduled board and committee meetings.
Investment Management Services. The nature of the investment management services provided to the Funds is quite complex and allows Fund shareholders access to professional money management, instant diversification of their investments, and liquidity. In evaluating investment performance, the board expects the advisor to manage the Funds in accordance with its investment objectives and approved strategies. Further, the Directors recognize that the advisor has an obligation to monitor trading activities, and in particular to seek the best execution of fund trades, and to evaluate the use of and payment for research. In providing these services, the advisor utilizes teams of investment professionals (portfolio managers, analysts, research assistants, and securities traders) who require extensive information technology, research, training, com pliance and other systems to conduct their business. At each quarterly meeting the Directors review investment performance information for the Funds, together with comparative information for appropriate benchmarks and/or peer groups of funds managed similarly to the Funds. The Directors also review detailed performance information during the 15(c) Process comparing each Fund’s performance with that of similar funds not managed by the advisor. If performance concerns are identified, the Directors discuss with the advisor the reasons for such results (e.g., market conditions, security selection) and any efforts being undertaken to improve performance. One Choice Portfolio: Very Aggressive’s performance was below the median for its peer group for the one-year period and above the median for the three-year period. The other funds’ performance for both the one- and three-year periods was above the median for each fund’s respective peer group.
Shareholder and Other Services. The advisor provides the Funds with a comprehensive package of transfer agency, shareholder, and other services. The Directors review reports and evaluations of such services at their regular quarterly meetings, including the annual meeting concerning contract review, and reports to the board. These reports include, but are not limited to, information regarding the operational efficiency and accuracy of the shareholder and transfer agency services provided, staffing levels, shareholder satisfaction (as measured by external as well as internal sources), technology support, new products and services offered to Fund shareholders, securities trading activities, portfolio valuation services, auditing services, and legal and operational compliance activities. Certain aspects of shareholder and transfer agency serv ice level efficiency and the quality of securities trading activities are measured by independent third party providers and are presented in comparison to other fund groups not managed by the advisor.
Costs of Services Provided and Profitability. The advisor provides detailed information concerning its cost of providing various services to the Funds, its profitability in managing the Funds, its overall profitability, and its financial condition. The Directors have reviewed with the advisor the methodology used to prepare this financial information. This financial information
47
regarding the advisor is considered in order to evaluate the advisor’s financial condition, its ability to continue to provide services under the management agreement, and the reasonableness of the current management fee. The board concluded that the advisor’s profits were reasonable in light of the services provided to the Funds.
Ethics. The Directors generally consider the advisor’s commitment to providing quality services to shareholders and to conducting its business ethically. They noted that the advisor’s practices generally meet or exceed industry best practices.
Economies of Scale. The Directors review information provided by the advisor regarding the possible existence of economies of scale in connection with the management of the Funds. The Directors concluded that economies of scale are difficult to measure and predict with precision, especially on a fund-by-fund basis. The analysis of economies of scale is further complicated by the additional services and content provided by the advisor and its reinvestment in its ability to provide and expand those services. Accordingly, the Directors seek to evaluate economies of scale by reviewing other information, such as year-over-year profitability of the advisor generally, the profitability of its management of the Funds specifically, the expenses incurred by the advisor in providing various functions to the Funds, and the fees of competitive funds no t managed by the advisor. The Directors believe the advisor is appropriately sharing economies of scale through its competitive fee structure, fee breakpoints as each Fund increases in size, and through reinvestment in its business to provide shareholders additional content and services.
Comparison to Other Funds’ Fees. The Funds invest their non-cash assets entirely in other American Century Investment funds. The funds do not pay an investment advisor fee to the advisor. Rather, each fund indirectly bears its pro rata share of the expenses incurred by the underlying funds. Each of the underlying Funds pay the advisor a single, all-inclusive (or unified) management fee for providing all services necessary for the management and operation of the Funds, other than brokerage expenses, taxes, interest, extraordinary expenses, and the fees and expenses of each Fund’s independent directors (including their independent legal counsel). Under the unified fee structure, the advisor is responsible for providing all investment advisory, custody, audit, administrative, compliance, recordkeeping, marketing and shareholder serv ices, or arranging and supervising third parties to provide such services. By contrast, most other funds are charged a variety of fees, including an investment advisory fee, a transfer agency fee, an administrative fee, distribution charges and other expenses. Other than their investment advisory fees and Rule 12b-1 distribution fees, all other components of the total fees charged by these other funds may be increased without shareholder approval. The board believes the unified fee structure is a benefit to Fund shareholders because it clearly discloses to shareholders the cost of owning Fund shares, and, since the unified fee cannot be increased without a vote of Fund shareholders, it shifts to the advisor the risk of increased costs of operating the Fund and provides a direct incentive to minimize administrative inefficiencies. Part of the Directors’ analysis of fee levels involves reviewing certain evaluative data compiled by a 15(c) Provider comparing each Fund’s total expense ratio to the tota l
48
expense ratio of other funds in the Fund’s peer group and performing a regression analysis to evaluate the effect of fee breakpoints as assets under management increase. The total expenses paid by shareholders of One Choice Portfolio: Very Aggressive and One Choice Portfolio: Very Conservative were at or below the median of the total expense ratios of each fund’s respective peer group. The total expenses paid by shareholders of One Choice Portfolio: Aggressive, One Choice Portfolio: Moderate and One Choice Portfolio: Conservative were above the median of the total expense ratios of each fund’s respective peer group. In addition, the Directors also reviewed updated fee level data provided by the advisor, but recognized that comparative data was particularly difficult to evaluate given the significant market developments during the past year. The board concluded that the total expenses paid by each Fund were rea sonable in light of the services provided to the Fund.
Comparison to Fees and Services Provided to Other Clients of the Advisor. The Directors also requested and received information from the advisor concerning the nature of the services, fees, and profitability of its advisory services to advisory clients other than the Funds. They observed that these varying types of client accounts require different services and involve different regulatory and entrepreneurial risks than the management of the Funds. The Directors analyzed this information and concluded that the fees charged and services provided to the Funds were reasonable by comparison.
Collateral Benefits Derived by the Advisor. The Directors considered the existence of collateral benefits the advisor may receive as a result of its relationship with the Funds. They concluded that the advisor’s primary business is managing mutual funds and it generally does not use fund or shareholder information to generate profits in other lines of business, and therefore does not derive any significant collateral benefits from them. The Directors noted that the advisor receives proprietary research from broker-dealers that execute fund portfolio transactions and concluded that this research is likely to benefit fund shareholders. The Directors also determined that the advisor is able to provide investment management services to certain clients other than the Funds, at least in part, due to its existing infrastructure built to serv e the fund complex. The Directors concluded, however, that the assets of those other clients are not material to the analysis and, in any event, are included with the assets of the Funds to determine breakpoints in each Fund’s fee schedule, provided they are managed using the same investment team and strategy.
Conclusions of the Directors
As a result of this process, the board, including all of the independent directors, in the absence of particular circumstances and assisted by the advice of legal counsel that is independent of the advisor, taking into account all of the factors discussed above and the information provided by the advisor concluded that the investment management agreement between each Fund and the advisor is fair and reasonable in light of the services provided and should be renewed.
49
Additional Information |
Retirement Account Information
As required by law, distributions you receive from certain IRAs, or 403(b), 457 and qualified plans are subject to federal income tax withholding, unless you elect not to have withholding apply. Tax will be withheld on the total amount withdrawn even though you may be receiving amounts that are not subject to withholding, such as nondeductible contributions. In such case, excess amounts of withholding could occur. You may adjust your withholding election so that a greater or lesser amount will be withheld.
If you don’t want us to withhold on this amount, you must notify us to not withhold the federal income tax. You may notify us in writing or in certain situations by telephone or through other electronic means. You have the right to revoke your withholding election at any time and any election you make may remain in effect until revoked by filing a new election.
Remember, even if you elect not to have income tax withheld, you are liable for paying income tax on the taxable portion of your withdrawal. If you elect not to have income tax withheld or you don’t have enough income tax withheld, you may be responsible for payment of estimated tax. You may incur penalties under the estimated tax rules if your withholding and estimated tax payments are not sufficient. You can reduce or defer the income tax on a distribution by directly or indirectly rolling such distribution over to another IRA or eligible plan. You should consult your tax advisor for additional information.
State tax will be withheld if, at the time of your distribution, your address is within one of the mandatory withholding states and you have federal income tax withheld. State taxes will be withheld from your distribution in accordance with the respective state rules.
Proxy Voting Guidelines
American Century Investment Management, Inc., the funds’ investment advisor, is responsible for exercising the voting rights associated with the securities purchased and/or held by the funds. A description of the policies and procedures the advisor uses in fulfilling this responsibility is available without charge, upon request, by calling 1-800-345-2021. It is also available on American Century Investments’ website at americancentury.com and on the Securities and Exchange Commission’s website at sec.gov. Information regarding how the investment advisor voted proxies relating to portfolio securities during the most recent 12-month period ended June 30 is available on the “About Us” page at americancentury.com. It is also available at sec.gov.
Quarterly Portfolio Disclosure
The funds file their complete schedule of portfolio holdings with the Securities and Exchange Commission (SEC) for the first and third quarters of each fiscal year on Form N-Q. The funds’ Forms N-Q are available on the SEC’s website at sec.gov, and may be reviewed and copied at 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. The funds also make their complete schedule of portfolio holdings for the most recent quarter of their fiscal year available on their website at americancentury.com and, upon request, by calling 1-800-345-2021.
50
Index Definitions |
The following indices are used to illustrate investment market, sector, or style performance or to serve as fund performance comparisons. They are not investment products available for purchase.
The Citigroup Non-US World Government Bond Index is based on the Citigroup World Bond Index, and excludes issues denominated in U.S. dollars. The index measures the total return of government securities in major sectors of the international bond market.
The Citigroup US Broad Investment-Grade (BIG) Bond Index is a market-capitalization-weighted index that includes fixed-rate Treasury, government-sponsored, mortgage, asset-backed, and investment-grade issues with a maturity of one year or longer.
The Citigroup US Treasury 10-Year Benchmark (On-the-Run) Index measures total returns for the current 10-year on-the-run Treasuries that have been in existence for the entire month.
The Citigroup US Treasury Bill Three-Month Index measures monthly return equivalents of yield averages that are not marked to market. The Treasury Bill Three-Month Index is an average of the last three three-month Treasury bill month-end rates.
Morgan Stanley Capital International (MSCI) has developed several indices that measure the performance of foreign stock markets.
The MSCI EAFE (Europe, Australasia, Far East) Index is designed to measure developed market equity performance, excluding the U.S. and Canada.
The MSCI EM (Emerging Markets) Index represents the performance of stocks in global emerging market countries.
The Russell 1000® Index is a market-capitalization weighted, large-cap index created by Frank Russell Company to measure the performance of the 1,000 largest publicly traded U.S. companies, based on total market capitalization.
The Russell 2000® Index is a market-capitalization weighted index created by Frank Russell Company to measure the performance of the 2,000 smallest of the 3,000 largest publicly traded U.S. companies, based on total market capitalization.
The Russell 3000® Index measures the performance of the 3,000 largest U.S. companies based on total market capitalization, which represents approximately 98% of the investable U.S. equity market.
The Russell Midcap® Index measures the performance of the 800 smallest of the 1,000 largest publicly traded U.S. companies, based on total market capitalization.
51
Notes |
52
Notes |
53
Notes |
54
![](https://capedge.com/proxy/N-CSR/0001467105-09-000019/cl-ann66296x60x1.jpg)
Contact Us | |
americancentury.com | |
Automated Information Line | 1-800-345-8765 |
Investor Services Representative | 1-800-345-2021 or |
816-531-5575 | |
Business, Not-For-Profit, Employer-Sponsored | |
Retirement Plans | 1-800-345-3533 |
Banks and Trust Companies, Broker-Dealers, | |
Financial Professionals, Insurance Companies | 1-800-345-6488 |
Telecommunications Device for the Deaf | 1-800-634-4113 |
American Century Asset Allocation Portfolios, Inc. | |
Investment Advisor: | |
American Century Investment Management, Inc. | |
Kansas City, Missouri |
This report and the statements it contains are submitted for the general
information of our shareholders. The report is not authorized for distribution to
prospective investors unless preceded or accompanied by an effective prospectus.
American Century Investment Services, Inc., Distributor
©2009 American Century Proprietary Holdings, Inc. All rights reserved.
0909 CL-ANN-66296N
ITEM 2. CODE OF ETHICS.
(a) | The registrant has adopted a Code of Ethics for Senior Financial Officers that applies to the | |
registrant’s principal executive officer, principal financial officer, principal accounting officer, and | ||
persons performing similar functions. | ||
(b) | No response required. | |
(c) | None. | |
(d) | None. | |
(e) | Not applicable. | |
(f) | The registrant’s Code of Ethics for Senior Financial Officers was filed as Exhibit 12 (a)(1) to | |
American Century Asset Allocation Portfolios, Inc.’s Annual Certified Shareholder Report on | ||
Form N-CSR, File No. 811-21591, on September 29, 2005, and is incorporated herein by reference. | ||
ITEM 3. AUDIT COMMITTEE FINANCIAL EXPERT. | ||
(a)(1) | The registrant’s board has determined that the registrant has at least one audit committee financial | |
expert serving on its audit committee. | ||
(a)(2) | James A. Olson and Thomas A. Brown are the registrant’s designated audit committee financial | |
experts. They are “independent” as defined in Item 3 of Form N-CSR. | ||
(a)(3) | Not applicable. | |
(b) | No response required. | |
(c) | No response required. | |
(d) | No response required. | |
ITEM 4. PRINCIPAL ACCOUNTANT FEES AND SERVICES. | ||
(a) | Audit Fees. | |
The aggregate fees billed for each of the last two fiscal years for professional services rendered by the | ||
principal accountant for the 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 were as follows: | ||
FY 2008: | $ 76,990 | |
FY 2009: | $114,612 |
(b) | Audit-Related Fees. | |
The aggregate fees billed in each of the last two fiscal years for assurance and related services by the | ||
principal accountant that are reasonably related to the performance of the audit of the registrant’s financial | ||
statements and are not reported under paragraph (a) of this Item were as follows: | ||
For services rendered to the registrant: | ||
FY 2008: | $0 | |
FY 2009: | $0 | |
Fees required to be approved pursuant to paragraph (c)(7)(ii) of Rule 2-01 of Regulation S-X | ||
(relating to certain engagements for non-audit services with the registrant’s investment adviser and | ||
its affiliates): | ||
FY 2008: | $0 | |
FY 2009: | $0 | |
(c) | Tax Fees. | |
The aggregate fees billed in each of the last two fiscal years for professional services rendered by the | ||
principal accountant for tax compliance, tax advice, and tax planning were as follows: | ||
For services rendered to the registrant: | ||
FY 2008: | $0 | |
FY 2009: | $0 | |
Fees required to be approved pursuant to paragraph (c)(7)(ii) of Rule 2-01 of Regulation S-X | ||
(relating to certain engagements for non-audit services with the registrant’s investment adviser and | ||
its affiliates): | ||
FY 2008: | $0 | |
FY 2009: | $0 | |
(d) | All Other Fees. | |
The aggregate fees billed in each of the last two fiscal years for products and services provided by the | ||
principal accountant, other than the services reported in paragraphs (a) through (c) of this Item were as | ||
follows: | ||
For services rendered to the registrant: | ||
FY 2008: | $0 | |
FY 2009: | $0 | |
Fees required to be approved pursuant to paragraph (c)(7)(ii) of Rule 2-01 of Regulation S-X | ||
(relating to certain engagements for non-audit services with the registrant’s investment adviser and | ||
its affiliates): | ||
FY 2008: | $0 | |
FY 2009: | $0 |
(e)(1) | In accordance with paragraph (c)(7)(i)(A) of Rule 2-01 of Regulation S-X, before the accountant is | |
engaged by the registrant to render audit or non-audit services, the engagement is approved by the | ||
registrant’s audit committee. Pursuant to paragraph (c)(7)(ii) of Rule 2-01 of Regulation S-X, the | ||
registrant’s audit committee also pre-approves its accountant’s engagements for non-audit services | ||
with the registrant’s investment adviser, its parent company, and any entity controlled by, or under | ||
common control with the investment adviser that provides ongoing services to the registrant, if the | ||
engagement relates directly to the operations and financial reporting of the registrant. | ||
(e)(2) | All services described in each of paragraphs (b) through (d) of this Item were pre-approved before | |
the engagement by the registrant’s audit committee pursuant to paragraph (c)(7)(i)(A) of Rule 2-01 | ||
of Regulation S-X. Consequently, none of such services were required to be approved by the audit | ||
committee pursuant to paragraph (c)(7)(i)(C). | ||
(f) | The percentage of hours expended on the principal accountant’s engagement to audit the | |
registrant’s financial statements for the most recent fiscal year that were attributed to work | ||
performed by persons other than the principal accountant’s full-time, permanent employees was | ||
less than 50%. | ||
(g) | The aggregate non-audit fees billed by the registrant’s accountant for services rendered to the | |
registrant, and rendered to the registrant’s investment adviser (not including any sub-adviser whose | ||
role is primarily portfolio management and is subcontracted with or overseen by another | ||
investment adviser), and any entity controlling, controlled by, or under common control with the | ||
adviser that provides ongoing services to the registrant for each of the last two fiscal years of the | ||
registrant were as follows: | ||
FY 2008: | $75,493 | |
FY 2009: | $81,217 | |
(h) | The registrant’s investment adviser and accountant have notified the registrant’s audit committee of | |
all non-audit services that were rendered by the registrant’s accountant to the registrant’s | ||
investment adviser, its parent company, and any entity controlled by, or under common control | ||
with the investment adviser that provides services to the registrant, which services were not | ||
required to be pre-approved pursuant to paragraph (c)(7)(ii) of Rule 2-01 of Regulation S-X. The | ||
notification provided to the registrant’s audit committee included sufficient details regarding such | ||
services to allow the registrant’s audit committee to consider the continuing independence of its | ||
principal accountant. | ||
ITEM 5. AUDIT COMMITTEE OF LISTED REGISTRANTS. | ||
Not applicable. | ||
ITEM 6. INVESTMENTS. | ||
(a) | The schedule of investments is included as part of the report to stockholders filed under Item 1 of | |
this Form. | ||
(b) | Not applicable. | |
ITEM 7. DISCLOSURE OF PROXY VOTING POLICIES AND PROCEDURES FOR | ||
CLOSED-END MANAGEMENT INVESTMENT COMPANIES. | ||
Not applicable. |
ITEM 8. PORTFOLIO MANAGERS OF CLOSED-END MANAGEMENT INVESTMENT | |
COMPANIES. | |
Not applicable. | |
ITEM 9. PURCHASES OF EQUITY SECURITIES BY CLOSED-END MANAGEMENT | |
INVESTMENT COMPANY AND AFFILIATED PURCHASERS. | |
Not applicable. | |
ITEM 10. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS. | |
During the reporting period, there were no material changes to the procedures by which shareholders may | |
recommend nominees to the registrant’s board. | |
ITEM 11. CONTROLS AND PROCEDURES. | |
(a) | The registrant's principal executive officer and principal financial officer have concluded that the |
registrant's disclosure controls and procedures (as defined in Rule 30a-3(c) under the Investment | |
Company Act of 1940) are effective based on their evaluation of these controls and procedures as | |
of a date within 90 days of the filing date of this report. | |
(b) | There were no changes in the registrant's internal control over financial reporting (as defined in |
Rule 30a-3(d) under the Investment Company Act of 1940) that occurred during the registrant's | |
second fiscal quarter of the period covered by this report that have materially affected, or are | |
reasonably likely to materially affect, the registrant's internal control over financial reporting. | |
ITEM 12. EXHIBITS. | |
(a)(1) | Registrant’s Code of Ethics for Senior Financial Officers, which is the subject of the disclosure |
required by Item 2 of Form N-CSR, was filed as Exhibit 12(a)(1) to American Century Asset | |
Allocation Portfolios, Inc.’s Certified Shareholder Report on Form N-CSR, File No. 811-21591, on | |
September 29, 2005. | |
(a)(2) | Separate certifications by the registrant’s principal executive officer and principal financial officer, |
pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 and Rule 30a-2(a) under the Investment | |
Company Act of 1940, are filed and attached hereto as EX-99.CERT. | |
(a)(3) | Not applicable. |
(b) | A certification by the registrant’s chief executive officer and chief financial officer, pursuant to |
Section 906 of the Sarbanes-Oxley Act of 2002, is furnished and attached hereto as EX- | |
99.906CERT. |
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: | American Century Asset Allocation Portfolios, Inc. | |
By: | /s/ Jonathan S. Thomas | |
Name: | Jonathan S. Thomas | |
Title: | President | |
Date: | September 29, 2009 |
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: | /s/ Jonathan S. Thomas | |
Name: | Jonathan S. Thomas | |
Title: | President | |
(principal executive officer) | ||
Date: | September 29, 2009 |
By: | /s/ Robert J. Leach | |
Name: | Robert J. Leach | |
Title: | Vice President, Treasurer, and | |
Chief Financial Officer | ||
(principal financial officer) | ||
Date: | September 29, 2009 |