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 811-22954
HIMCO VARIABLE INSURANCE TRUST
(Exact name of registrant as specified in charter)
One Hartford Plaza, Hartford, Connecticut 06155
(Address of principal executive offices) (Zip code)
Brenda J. Page
Hartford Investment Management Company
One Hartford Plaza
Hartford, Connecticut 06155
(Name and address of agent for service)
Registrant’s telephone number, including area code: (860) 297-6444
Date of fiscal year end: December 31
Date of reporting period: December 31, 2017
Form N-CSR is to be used by management investment companies to file reports with the Commission not later than 10 days after the transmission to stockholders of any report that is required to be transmitted to stockholders under Rule 30e-1 under the Investment Company Act of 1940 (17 CFR 270.30e-1). The Commission may use the information provided on Form N-CSR in its regulatory, disclosure review, inspection, and policymaking roles.
A registrant is required to disclose the information specified by Form N-CSR, and the Commission will make this information public. A registrant is not required to respond to the collection of information contained in Form N-CSR unless the Form displays a currently valid Office of Management and Budget (“OMB”) control number. Please direct comments concerning the accuracy of the information collection burden estimate and any suggestions for reducing the burden to Secretary, Securities and Exchange Commission, 450 Fifth Street, NW, Washington, DC 20549-0609. The OMB has reviewed this collection of information under the clearance requirements of 44 U.S.C. § 3507.
Item 1. Reports to Stockholders.

A MESSAGE FROM THE PRESIDENT
Dear Shareholders:
Thank you for investing in the HIMCO Variable Insurance Trust (HVIT) funds.
Market Review
2017 was a very strong year for financial markets and investment returns. A key driver was synchronized economic growth across the globe. For the first time in the post-2008 financial crisis period, the major economies of the U.S., Europe, Japan, China and the Emerging Markets all experienced accelerating economic growth at the same time.
U.S. companies benefited strongly from this uptick in global growth, and a weaker U.S. dollar versus most currencies helped increase the competitiveness of U.S. products and services in foreign markets. U.S. fiscal policy has taken on a clear pro-growth stance with the passage of tax reform and rollback of regulations. Monetary policy continues to be well telegraphed and a successor, Jerome Powell, is set to replace U.S. Federal Reserve (Fed) Chair Janet Yellen in early 2018. Powell is a choice that the market appears to be very comfortable with and is expected to represent a high degree of continuity from the Yellen-led Fed.
The second half of 2017 saw U.S. GDP growth accelerate to nearly 3%. The U.S. unemployment rate sits just above 4%, the lowest level since 2000. Often, stronger economic growth and low levels of unemployment lead to an increase in interest rates as market participants anticipate higher levels of inflation, and/or actions by the Fed to increase rates to head-off inflation. But longer-dated U.S. Treasury rates have not increased. The 10 year treasury yield ended 2016 at 2.44% and ended 2017 at 2.40%. Accelerating growth with sustained low interest rates provide a strong foundation for financial assets. Volatility measures were muted all year and the S&P 500 posted positive returns in all 12 months of 2017.
For the full year, U.S. stocks and bonds delivered very strong performance. U.S. stocks (as represented by the S&P 500 Index1) returned 21.8% – the ninth consecutive year of positive returns, while U.S. bonds (as represented by the Bloomberg Barclays U.S. Aggregate Bond Index2) returned 3.5%.
As we enter 2018, the global economy has positive momentum and U.S. corporations are set to receive the biggest tax cut in the last 30 years. In our view, signs appear to point to a continued favorable outlook in 2018. We expect U.S. growth to moderate slightly from 2017, but continue to provide a strong economic backdrop for financial markets. In 2017, persistent U.S. dollar weakness and the strong recovery in capital expenditure from the industrial recession of 2015/16 fueled economic outperformance, which will be difficult to replicate in 2018. However, we believe that increased consumer spending and capital expenditures driven by tax reform could be catalysts for a further upside surprise in growth.
As with any outlook, there are risks and uncertainties. We expect Central Banks to continue to pull back the securities purchase programs they initiated post-2008 financial crisis to lower interest rates and stimulate economic growth. These “Quantitative Easing” programs were instrumental in promoting growth. Just as there was uncertainty as to the effects of these programs when they were ramping up, there are many questions as to the impacts of their withdrawal.
International tensions remain a risk for 2018. Looming North American Free Trade Agreement negotiations, China, Brexit, and North Korea remain key flashpoints. We expect longer term interest rates to continue to move higher and the yield curve to continue to flatten over the course of 2018. We believe the Fed is likely to continue raising short-term interest rates, with risks that they either increase too quickly and severely dampen economic growth, or increase too slowly and let inflation get out of hand.
We are reminded on a regular basis that financial markets can often surprise, which is why you should consider regular reviews with your financial advisor. Your advisor can help you understand market issues, invest with confidence, and help ensure that your investment goals, time horizon and risk tolerance are what drive your investment strategy.
Thank you again for investing with the HIMCO Variable Insurance Trust funds.

Matthew J. Poznar
President, HVIT
1 | The S&P 500 Index is a market capitalization-weighted index designed to measure market results for large-capitalization United States equities. |
2 | The Bloomberg Barclays U.S. Aggregate Bond Index is a broad-based flagship benchmark that measures the investment grade, US dollar-denominated, fixed-rate taxable bond market. The index includes Treasuries, government-related and corporate securities, MBS (agency fixed-rate and hybrid ARM pass-throughs), ABS and CMBS (agency and non-agency). |
HIMCO VIT Index Fund
Table of Contents
This report is prepared for the general information of contract owners and qualified retirement plan participants. It is not an offer to buy or sell an annuity contract or qualified retirement plan, fund or any security. It should not be used in connection with any offer, except in conjunction with the appropriate product prospectus (which contains all pertinent product information including the applicable sales, administrative and other charges) and the current prospectus and/or summary prospectus of the Fund available for investment thereunder.
The views expressed in the President’s Letter above and, to the extent included herein, the Fund’s Manager Discussion under “Why did the Fund perform this way?” and “What is your outlook?” are views of the Fund’s adviser and portfolio management team through the end of the period and are subject to change based on market and other conditions. The President’s Letter and, to the extent included herein, the Fund’s Manager Discussion, are for informational purposes only and do not represent investment advice or an offer, recommendation or solicitation to buy, hold or sell any security. The specific securities identified and described, if any, do not represent all of the securities purchased or sold and you should not assume that investments in the securities identified and discussed will be profitable.
HIMCO VIT Index Fund inception 05/01/1987
| | |
(The Fund is advised by Hartford Investment Management Company (“Hartford Investment Management”)) | | Investment Goal: The Fund seeks to provide investment results which approximate the price and yield performance of publicly traded common stocks in the aggregate. |
Performance information for periods prior to October 20, 2014 is that of the Hartford Index HLS Fund (the “Predecessor Fund”). Hartford Funds Management Company, LLC served as the investment manager to the Predecessor Fund and Hartford Investment Management, the Fund’s adviser, served as sub-adviser to the Predecessor Fund. The Predecessor Fund had the same investment objective and strategies as the Fund.

The chart above represents the hypothetical growth of a $10,000 investment in Class IA. Growth results in classes other than Class IA will vary from what is seen above due to differences in the expenses charged to those share classes.
Average Annual Total Returns (as of 12/31/17)
| | | | | | | | | | | | |
| | 1 Year | | | 5 Years | | | 10 Years | |
HIMCO VIT Index Fund Class IA | | | 21.44% | | | | 15.42% | | | | 8.18% | |
HIMCO VIT Index Fund Class IB | | | 21.13% | | | | 15.12% | | | | 7.91% | |
S&P 500 Index | | | 21.83% | | | | 15.79% | | | | 8.50% | |
PERFORMANCE DATA QUOTED REPRESENTS PAST PERFORMANCE AND DOES NOT GUARANTEE FUTURE RESULTS. The investment return and principal value of the investment will fluctuate so that investors’ shares, when redeemed, may be worth more or less than their original cost. Current performance may be lower or higher than the performance data quoted.
Total returns presented above were calculated using the Fund’s net asset value available to shareholders for sale or redemption of Fund shares on December 31, 2017, which may exclude investment transactions as of this date. All share class returns assume the reinvestment of all distributions at net asset value and the deduction of all fund expenses.
S&P 500 Index is a market capitalization-weighted index designed to measure market results for large-capitalization United States equities.*
* | The S&P 500 Index is a product of S&P Dow Jones Indices LLC (“SPDJI”), and has been licensed for use by HIMCO Variable Insurance Trust. Standard & Poor’s® and S&P® are registered trademarks of Standard & Poor’s Financial Services LLC (“S&P”); Dow Jones® is a registered trademark of Dow Jones Trademark Holdings LLC (“Dow Jones”); and these trademarks have been licensed for use by SPDJI and sublicensed for certain purposes by HIMCO Variable Insurance Trust. The Fund is not sponsored, endorsed, sold or promoted by SPDJI, |
| Dow Jones, S&P, or their respective affiliates, and none of such parties make any representation regarding the advisability of investing in such product(s) nor do they have any liability for any errors, omissions, or interruptions of the S&P 500 Index. |
The index is unmanaged, and its results include reinvested dividends and/or distributions, but do not reflect the effect of sales charges, commissions, expenses or taxes. You cannot invest directly in an index.
| | | | | | | | |
Operating Expenses* | | Net | | | Gross | |
HIMCO VIT Index Class IA | | | 0.33% | | | | 0.38% | |
HIMCO VIT Index Class IB | | | 0.58% | | | | 0.63% | |
* | As shown in the Fund’s current prospectus dated April 30, 2017. Actual expenses may be higher or lower. Please see the accompanying Financial Highlights for expense ratios for the year ended December 31, 2017. |
Gross operating expenses shown are before management fee waivers or expense caps. Performance information may reflect historical or current expense waivers or reimbursements, without which, performance would have been lower.
Net operating expenses are the expenses paid to own the Fund. If the net operating expenses shown are lower than the gross operating expenses, then the net operating expenses reflect contractual management fee waivers and/or expense reimbursements that may not be renewed. The current contractual arrangement with respect to expense reimbursements remains in effect until April 30, 2018, and shall renew automatically for one-year terms unless the investment manager provides written notice of termination prior to the start of the next term or upon approval of the Board of Trustees of the Fund.
The chart and table do not reflect the deductions of taxes, sales charges or other fees which may be applied at the variable life insurance, variable annuity
or qualified retirement plan product level. Any such additional sales charges or other fees or expenses would lower the contract’s or plan’s performance.
All investments are subject to risk, including the possible loss of principal. The main risks of investing in the Fund are described below. For more detailed information on the risks associated with an investment in the Fund, please see the prospectus.
Market Risk – Market risk is the risk that one or more markets in which the Fund invests will go down in value, including the possibility that the markets will go down sharply and unpredictably. Securities may decline in value due to the activities and financial prospects of individual companies or to general market and economic movements and trends, including adverse changes to credit markets.
Index Strategy Risk – The Fund is not actively managed, but instead is designed to match its index. Therefore, the adverse performance of a particular stock ordinarily will not result in the elimination of the stock from the Fund’s portfolio. The Fund will remain invested in stocks even when stock prices are generally falling.
Tracking Error Risk – The Fund’s performance may not match or correlate to that of its reference index, either on a daily or aggregate basis. Factors such as cash flows, Fund expenses, imperfect correlation between the Fund’s portfolio and the component securities of the index, rounding of share prices, asset valuation, timing variances, changes to the composition of the index and regulatory requirements may cause the Fund’s performance to diverge from the performance of the index. Tracking error risk may cause the Fund’s performance to be less than expected.
Manager Discussion
December 31, 2017
How did the Fund perform?
The Class IA shares of the HIMCO VIT Index Fund (the “Fund”) returned 21.44% for the 12-month period ending December 31, 2017. The Fund matched its benchmark, the S&P 500 Index, which returned 21.83%.
Why did the Fund perform this way?
By design, the Fund seeks to mimic the performance of the S&P 500 Index and is expected to perform in line with the index. The performance of the Fund during the period marginally differed from the benchmark, primarily due to fund expenses, trading in futures contracts, replicating changes within the index, and minimal cash exposure.
During 2017, 9 of the 11 sectors as defined by GICS, Global Industry Classification Standard, in the S&P 500 Index posted positive returns, with information technology leading the way, gaining 38.8%. Materials was next, gaining 23.8%. The worst performing sector was telecom services which fell 1.3% during the period.
On a stock level, the leading constituents in the S&P 500 Index for the year were NRG Energy Inc., an owner of power-generating facilities, which rallied 133.7%, followed by Align Technology Inc., maker of the Invisalign System to treat misaligned teeth, which gained 131.1%. Laggards for the period included Under Armour Inc., an athletic wear company, which fell 50.3%, and Range Resources Corp, an independent oil and gas company, which dropped 50.1%.
Outlook
Looking into 2018, we believe equities can continue to deliver strong performance. We expect improved
fundamentals based on recently passed tax reform to overshadow weaker technicals and persistently high valuations. The market has already priced in much of the upside of the tax legislation in our view, but we believe lower corporate tax rates should provide a tailwind to corporate earnings. Our outlook is sensitive to the outcome of midterm elections (which could challenge the longevity of tax reform) and meaningful reversal in economic growth.
Diversification by Sector
as of December 31, 2017
| | | | |
Sector | | Percentage of Net Assets | |
Equity Securities | | | | |
Consumer Discretionary | | | 12.2 | % |
Consumer Staples | | | 8.1 | |
Energy | | | 6.0 | |
Financials | | | 14.7 | |
Health Care | | | 13.7 | |
Industrials | | | 10.2 | |
Information Technology | | | 23.7 | |
Materials | | | 3.0 | |
Real Estate | | | 2.9 | |
Telecommunication Services | | | 2.1 | |
Utilities | | | 2.9 | |
| | | | |
Total | | | 99.5 | % |
| | | | |
Short-Term Investments | | | 0.5 | |
Other assets and liabilities | | | — | |
| | | | |
Total | | | 100.0 | % |
| | | | |
A sector may be comprised of several industries. For Fund compliance purposes, the Fund may not use the same classification system and these sector classifications are used for reporting ease.
Schedule of Investments
December 31, 2017
| | | | | | | | |
Shares or Principal Amount | | Market Value(1) | |
COMMON STOCKS - 99.5% | |
| | | Automobiles & Components - 0.7% | |
| 13,352 | | | Aptiv plc | | $ | 1,132,650 | |
| 9,954 | | | BorgWarner, Inc. | | | 508,550 | |
| 195,959 | | | Ford Motor Co. | | | 2,447,528 | |
| 64,209 | | | General Motors Co. | | | 2,631,927 | |
| 12,372 | | | Goodyear Tire & Rubber Co. (The) | | | 399,739 | |
| 8,453 | | | Harley-Davidson, Inc. | | | 430,089 | |
| | | | | | | | |
| | | | | | | 7,550,483 | |
| | | | | | | | |
| | | Banks - 6.6% | | | |
| 487,227 | | | Bank of America Corp. | | | 14,382,941 | |
| 39,625 | | | BB&T Corp. | | | 1,970,155 | |
| 132,801 | | | Citigroup, Inc. | | | 9,881,723 | |
| 24,711 | | | Citizens Financial Group, Inc. | | | 1,037,368 | |
| 8,735 | | | Comerica, Inc. | | | 758,285 | |
| 35,439 | | | Fifth Third Bancorp | | | 1,075,219 | |
| 54,293 | | | Huntington Bancshares, Inc. | | | 790,506 | |
| 174,275 | | | JPMorgan Chase & Co. | | | 18,636,969 | |
| 54,014 | | | KeyCorp | | | 1,089,462 | |
| 7,560 | | | M&T Bank Corp. | | | 1,292,684 | |
| 17,391 | | | People’s United Financial, Inc. | | | 325,212 | |
| 23,898 | | | PNC Financial Services Group, Inc. (The) | | | 3,448,243 | |
| 58,262 | | | Regions Financial Corp. | | | 1,006,767 | |
| 23,910 | | | SunTrust Banks, Inc. | | | 1,544,347 | |
| 79,184 | | | US Bancorp | | | 4,242,679 | |
| 222,599 | | | Wells Fargo & Co. | | | 13,505,081 | |
| 10,033 | | | Zions Bancorp | | | 509,977 | |
| | | | | | | | |
| | | | | | | 75,497,618 | |
| | | | | | | | |
| | | Capital Goods - 7.4% | | | |
| 29,974 | | | 3M Co. | | | 7,054,980 | |
| 2,116 | | | Acuity Brands, Inc. | | | 372,416 | |
| 4,775 | | | Allegion plc | | | 379,899 | |
| 11,603 | | | AMETEK, Inc. | | | 840,869 | |
| 7,324 | | | AO Smith Corp. | | | 448,815 | |
| 21,246 | | | Arconic, Inc. | | | 578,953 | |
| 28,119 | | | Boeing Co. (The) | | | 8,292,574 | |
| 29,882 | | | Caterpillar, Inc. | | | 4,708,806 | |
| 7,836 | | | Cummins, Inc. | | | 1,384,151 | |
| 16,066 | | | Deere & Co. | | | 2,514,490 | |
| 7,826 | | | Dover Corp. | | | 790,348 | |
| 22,130 | | | Eaton Corp. plc | | | 1,748,491 | |
| 32,237 | | | Emerson Electric Co. | | | 2,246,597 | |
| 14,435 | | | Fastenal Co. | | | 789,450 | |
| 6,568 | | | Flowserve Corp. | | | 276,710 | |
| 7,033 | | | Fluor Corp. | | | 363,254 | |
| 15,362 | | | Fortive Corp. | | | 1,111,441 | |
| 7,743 | | | Fortune Brands Home & Security, Inc. | | | 529,931 | |
| 13,947 | | | General Dynamics Corp. | | | 2,837,517 | |
| 435,574 | | | General Electric Co. | | | 7,600,766 | |
| 5,987 | | | Harris Corp. | | | 848,059 | |
| 38,264 | | | Honeywell International, Inc. | | | 5,868,167 | |
| 15,487 | | | Illinois Tool Works, Inc. | | | 2,584,006 | |
| 12,550 | | | Ingersoll-Rand plc | | | 1,119,334 | |
| 6,049 | | | Jacobs Engineering Group, Inc. | | | 398,992 | |
| 46,482 | | | Johnson Controls International plc | | | 1,771,429 | |
| 3,925 | | | L3 Technologies, Inc. | | | 776,561 | |
| 12,530 | | | Lockheed Martin Corp. | | | 4,022,756 | |
| 15,800 | | | Masco Corp. | | | 694,252 | |
| 8,743 | | | Northrop Grumman Corp. | | | 2,683,314 | |
| 17,665 | | | PACCAR, Inc. | | | 1,255,628 | |
| 6,693 | | | Parker-Hannifin Corp. | | | 1,335,789 | |
| | | | | | | | |
Shares or Principal Amount | | Market Value(1) | |
COMMON STOCKS - 99.5% - (continued) | |
| | | Capital Goods - 7.4% - (continued) | | | |
| 8,303 | | | Pentair plc | | $ | 586,358 | |
| 7,771 | | | Quanta Services, Inc.(2) | | | 303,924 | |
| 14,520 | | | Raytheon Co. | | | 2,727,582 | |
| 6,453 | | | Rockwell Automation, Inc. | | | 1,267,047 | |
| 8,177 | | | Rockwell Collins, Inc. | | | 1,108,965 | |
| 5,139 | | | Roper Technologies, Inc. | | | 1,331,001 | |
| 2,863 | | | Snap-on, Inc. | | | 499,021 | |
| 7,700 | | | Stanley Black & Decker, Inc. | | | 1,306,613 | |
| 13,231 | | | Textron, Inc. | | | 748,742 | |
| 2,427 | | | TransDigm Group, Inc. | | | 666,503 | |
| 4,249 | | | United Rentals, Inc.(2) | | | 730,446 | |
| 37,302 | | | United Technologies Corp. | | | 4,758,616 | |
| 2,605 | | | WW Grainger, Inc. | | | 615,431 | |
| 9,028 | | | Xylem, Inc. | | | 615,710 | |
| | | | | | | | |
| | | | | | | 85,494,704 | |
| | | | | | | | |
| | | Commercial & Professional Services - 0.6% | |
| 4,325 | | | Cintas Corp. | | | 673,965 | |
| 6,031 | | | Equifax, Inc. | | | 711,176 | |
| 18,263 | | | IHS Markit Ltd.(2) | | | 824,574 | |
| 16,816 | | | Nielsen Holdings plc | | | 612,102 | |
| 11,415 | | | Republic Services, Inc. | | | 771,768 | |
| 6,296 | | | Robert Half International, Inc. | | | 349,680 | |
| 4,290 | | | Stericycle, Inc.(2) | | | 291,677 | |
| 7,814 | | | Verisk Analytics, Inc.(2) | | | 750,144 | |
| 20,065 | | | Waste Management, Inc. | | | 1,731,610 | |
| | | | | | | | |
| | | | | | | 6,716,696 | |
| | | | | | | | |
| | | Consumer Durables & Apparel - 1.2% | | | |
| 17,142 | | | DR Horton, Inc. | | | 875,442 | |
| 5,579 | | | Garmin Ltd. | | | 332,341 | |
| 18,324 | | | Hanesbrands, Inc. | | | 383,155 | |
| 5,693 | | | Hasbro, Inc. | | | 517,437 | |
| 6,621 | | | Leggett & Platt, Inc. | | | 316,020 | |
| 10,271 | | | Lennar Corp., Class A | | | 649,538 | |
| 17,230 | | | Mattel, Inc. | | | 264,997 | |
| 7,639 | | | Michael Kors Holdings Ltd.(2) | | | 480,875 | |
| 3,177 | | | Mohawk Industries, Inc.(2) | | | 876,534 | |
| 24,639 | | | Newell Brands, Inc. | | | 761,345 | |
| 65,996 | | | NIKE, Inc., Class B | | | 4,128,050 | |
| 13,584 | | | PulteGroup, Inc. | | | 451,668 | |
| 3,892 | | | PVH Corp. | | | 534,021 | |
| 2,784 | | | Ralph Lauren Corp. | | | 288,673 | |
| 14,283 | | | Tapestry, Inc. | | | 631,737 | |
| 9,299 | | | Under Armour, Inc., Class A(2) | | | 134,185 | |
| 9,259 | | | Under Armour, Inc., Class C(2) | | | 123,330 | |
| 16,473 | | | VF Corp. | | | 1,219,002 | |
| 3,609 | | | Whirlpool Corp. | | | 608,622 | |
| | | | | | | | |
| | | | | | | 13,576,972 | |
| | | | | | | | |
| | | Consumer Services - 1.9% | |
| 20,484 | | | Carnival Corp. | | | 1,359,523 | |
| 1,248 | | | Chipotle Mexican Grill, Inc.(2) | | | 360,709 | |
| 6,212 | | | Darden Restaurants, Inc. | | | 596,476 | |
| 10,510 | | | H&R Block, Inc. | | | 275,572 | |
| 10,157 | | | Hilton Worldwide Holdings, Inc. | | | 811,138 | |
| 15,382 | | | Marriott International, Inc., Class A | | | 2,087,799 | |
| 40,040 | | | McDonald’s Corp. | | | 6,891,685 | |
| 25,592 | | | MGM Resorts International | | | 854,517 | |
| 8,947 | | | Norwegian Cruise Line Holdings Ltd.(2) | | | 476,428 | |
| 8,602 | | | Royal Caribbean Cruises Ltd. | | | 1,026,047 | |
| 71,463 | | | Starbucks Corp. | | | 4,104,120 | |
The accompanying Notes are an integral part of these financial statements.
Schedule of Investments – (continued)
December 31, 2017
| | | | | | | | |
Shares or Principal Amount | | Market Value(1) | |
COMMON STOCKS - 99.5% - (continued) | |
| | | Consumer Services - 1.9% - (continued) | |
| 5,089 | | | Wyndham Worldwide Corp. | | $ | 589,662 | |
| 4,022 | | | Wynn Resorts Ltd. | | | 678,069 | |
| 16,926 | | | Yum! Brands, Inc. | | | 1,381,331 | |
| | | | | | | | |
| | | | | | | 21,493,076 | |
| | | | | | | | |
| | | Diversified Financials - 5.5% | |
| 2,792 | | | Affiliated Managers Group, Inc. | | | 573,058 | |
| 36,186 | | | American Express Co. | | | 3,593,632 | |
| 7,430 | | | Ameriprise Financial, Inc. | | | 1,259,162 | |
| 51,434 | | | Bank of New York Mellon Corp. (The) | | | 2,770,235 | |
| 96,657 | | | Berkshire Hathaway, Inc., Class B(2) | | | 19,159,351 | |
| 6,201 | | | BlackRock, Inc. | | | 3,185,516 | |
| 24,347 | | | Capital One Financial Corp. | | | 2,424,474 | |
| 5,699 | | | Cboe Global Markets, Inc. | | | 710,038 | |
| 59,918 | | | Charles Schwab Corp. (The) | | | 3,077,988 | |
| 17,089 | | | CME Group, Inc. | | | 2,495,848 | |
| 18,252 | | | Discover Financial Services | | | 1,403,944 | |
| 13,596 | | | E*TRADE Financial Corp.(2) | | | 673,954 | |
| 16,415 | | | Franklin Resources, Inc. | | | 711,262 | |
| 17,620 | | | Goldman Sachs Group, Inc. (The) | | | 4,488,871 | |
| 29,384 | | | Intercontinental Exchange, Inc. | | | 2,073,335 | |
| 20,454 | | | Invesco Ltd. | | | 747,389 | |
| 15,747 | | | Leucadia National Corp. | | | 417,138 | |
| 8,354 | | | Moody’s Corp. | | | 1,233,134 | |
| 69,920 | | | Morgan Stanley | | | 3,668,702 | |
| 5,844 | | | NASDAQ, Inc. | | | 448,995 | |
| 13,210 | | | Navient Corp. | | | 175,957 | |
| 10,798 | | | Northern Trust Corp. | | | 1,078,612 | |
| 6,452 | | | Raymond James Financial, Inc. | | | 576,164 | |
| 12,808 | | | S&P Global, Inc. | | | 2,169,675 | |
| 18,626 | | | State Street Corp. | | | 1,818,084 | |
| 36,949 | | | Synchrony Financial | | | 1,426,601 | |
| 12,171 | | | T Rowe Price Group, Inc. | | | 1,277,103 | |
| | | | | | | | |
| | | | | | | 63,638,222 | |
| | | | | | | | |
| | | Energy - 6.0% | |
| 27,482 | | | Anadarko Petroleum Corp. | | | 1,474,134 | |
| 7,208 | | | Andeavor | | | 824,163 | |
| 19,134 | | | Apache Corp. | | | 807,837 | |
| 21,519 | | | Baker Hughes a GE Co. | | | 680,861 | |
| 23,231 | | | Cabot Oil & Gas Corp. | | | 664,407 | |
| 45,652 | | | Chesapeake Energy Corp.(2) | | | 180,782 | |
| 95,400 | | | Chevron Corp. | | | 11,943,126 | |
| 4,785 | | | Cimarex Energy Co. | | | 583,818 | |
| 7,470 | | | Concho Resources, Inc.(2) | | | 1,122,143 | |
| 60,047 | | | ConocoPhillips | | | 3,295,980 | |
| 26,395 | | | Devon Energy Corp. | | | 1,092,753 | |
| 29,042 | | | EOG Resources, Inc. | | | 3,133,922 | |
| 12,297 | | | EQT Corp. | | | 699,945 | |
| 212,826 | | | Exxon Mobil Corp. | | | 17,800,767 | |
| 43,825 | | | Halliburton Co. | | | 2,141,728 | |
| 5,459 | | | Helmerich & Payne, Inc. | | | 352,870 | |
| 13,566 | | | Hess Corp. | | | 643,978 | |
| 96,469 | | | Kinder Morgan, Inc. | | | 1,743,195 | |
| 42,678 | | | Marathon Oil Corp. | | | 722,539 | |
| 24,532 | | | Marathon Petroleum Corp. | | | 1,618,621 | |
| 19,106 | | | National Oilwell Varco, Inc. | | | 688,198 | |
| 10,014 | | | Newfield Exploration Co.(2) | | | 315,741 | |
| 24,461 | | | Noble Energy, Inc. | | | 712,794 | |
| 38,439 | | | Occidental Petroleum Corp. | | | 2,831,417 | |
| 19,259 | | | ONEOK, Inc. | | | 1,029,394 | |
| | | | | | | | |
Shares or Principal Amount | | Market Value(1) | |
COMMON STOCKS - 99.5% - (continued) | |
| | | Energy - 6.0% - (continued) | |
| 21,581 | | | Phillips 66 | | $ | 2,182,918 | |
| 8,547 | | | Pioneer Natural Resources Co. | | | 1,477,349 | |
| 11,352 | | | Range Resources Corp. | | | 193,665 | |
| 69,578 | | | Schlumberger Ltd. | | | 4,688,861 | |
| 22,022 | | | TechnipFMC plc | | | 689,509 | |
| 21,978 | | | Valero Energy Corp. | | | 2,019,998 | |
| 41,527 | | | Williams Cos., Inc. (The) | | | 1,266,158 | |
| | | | | | | | |
| | | | | | | 69,623,571 | |
| | | | | | | | |
| | | Food & Staples Retailing - 1.8% | |
| 21,949 | | | Costco Wholesale Corp. | | | 4,085,148 | |
| 50,880 | | | CVS Health Corp. | | | 3,688,800 | |
| 44,678 | | | Kroger Co. (The) | | | 1,226,411 | |
| 24,077 | | | Sysco Corp. | | | 1,462,196 | |
| 73,519 | | | Wal-Mart Stores, Inc. | | | 7,260,001 | |
| 43,608 | | | Walgreens Boots Allliance, Inc. | | | 3,166,813 | |
| | | | | | | | |
| | | | | | | 20,889,369 | |
| | | | | | | | |
| | | Food, Beverage & Tobacco - 4.5% | |
| 95,843 | | | Altria Group, Inc. | | | 6,844,149 | |
| 28,090 | | | Archer-Daniels-Midland Co. | | | 1,125,847 | |
| 9,845 | | | Brown-Forman Corp., Class B | | | 676,056 | |
| 9,661 | | | Campbell Soup Co. | | | 464,791 | |
| 192,601 | | | Coca-Cola Co. (The) | | | 8,836,534 | |
| 20,518 | | | Conagra Brands, Inc. | | | 772,913 | |
| 8,653 | | | Constellation Brands, Inc., Class A | | | 1,977,816 | |
| 9,068 | | | Dr Pepper Snapple Group, Inc. | | | 880,140 | |
| 28,546 | | | General Mills, Inc. | | | 1,692,492 | |
| 7,086 | | | Hershey Co. (The) | | | 804,332 | |
| 13,521 | | | Hormel Foods Corp. | | | 492,029 | |
| 5,710 | | | JM Smucker Co. (The) | | | 709,410 | |
| 12,493 | | | Kellogg Co. | | | 849,274 | |
| 29,988 | | | Kraft Heinz Co. (The) | | | 2,331,867 | |
| 6,014 | | | McCormick & Co., Inc. | | | 612,887 | |
| 9,285 | | | Molson Coors Brewing Co., Class B | | | 762,020 | |
| 75,059 | | | Mondelez International, Inc., Class A | | | 3,212,525 | |
| 20,678 | | | Monster Beverage Corp.(2) | | | 1,308,711 | |
| 71,430 | | | PepsiCo, Inc. | | | 8,565,886 | |
| 78,010 | | | Philip Morris International, Inc. | | | 8,241,757 | |
| 14,947 | | | Tyson Foods, Inc., Class A | | | 1,211,753 | |
| | | | | | | | |
| | | | | | | 52,373,189 | |
| | | | | | | | |
| | | Health Care Equipment & Services - 5.6% | |
| 87,425 | | | Abbott Laboratories | | | 4,989,345 | |
| 16,379 | | | Aetna, Inc. | | | 2,954,608 | |
| 3,627 | | | Align Technology, Inc.(2) | | | 805,883 | |
| 8,106 | | | AmerisourceBergen Corp. | | | 744,293 | |
| 12,896 | | | Anthem, Inc. | | | 2,901,729 | |
| 25,178 | | | Baxter International, Inc. | | | 1,627,506 | |
| 13,310 | | | Becton Dickinson and Co. | | | 2,849,072 | |
| 68,983 | | | Boston Scientific Corp.(2) | | | 1,710,089 | |
| 15,802 | | | Cardinal Health, Inc. | | | 968,188 | |
| 8,671 | | | Centene Corp.(2) | | | 874,730 | |
| 15,861 | | | Cerner Corp.(2) | | | 1,068,873 | |
| 12,384 | | | Cigna Corp. | | | 2,515,067 | |
| 2,456 | | | Cooper Cos., Inc. (The) | | | 535,113 | |
| 30,746 | | | Danaher Corp. | | | 2,853,844 | |
| 7,604 | | | DaVita, Inc.(2) | | | 549,389 | |
| 11,538 | | | DENTSPLY SIRONA, Inc. | | | 759,546 | |
| 10,629 | | | Edwards Lifesciences Corp.(2) | | | 1,197,995 | |
| 6,075 | | | Envision Healthcare Corp.(2) | | | 209,952 | |
| 28,447 | | | Express Scripts Holding Co.(2) | | | 2,123,284 | |
The accompanying Notes are an integral part of these financial statements.
Schedule of Investments – (continued)
December 31, 2017
| | | | | | | | |
Shares or Principal Amount | | Market Value(1) | |
COMMON STOCKS - 99.5% - (continued) | |
| | | Health Care Equipment & Services - 5.6% - (continued) | |
| 14,226 | | | HCA Healthcare, Inc.(2) | | $ | 1,249,612 | |
| 7,883 | | | Henry Schein, Inc.(2) | | | 550,864 | |
| 13,847 | | | Hologic, Inc.(2) | | | 591,959 | |
| 7,175 | | | Humana, Inc. | | | 1,779,902 | |
| 4,381 | | | IDEXX Laboratories, Inc.(2) | | | 685,101 | |
| 5,628 | | | Intuitive Surgical, Inc.(2) | | | 2,053,882 | |
| 5,118 | | | Laboratory Corp. of America Holdings(2) | | | 816,372 | |
| 10,471 | | | McKesson Corp. | | | 1,632,952 | |
| 67,987 | | | Medtronic plc | | | 5,489,950 | |
| 4,141 | | | Patterson Cos., Inc. | | | 149,614 | |
| 6,846 | | | Quest Diagnostics, Inc. | | | 674,263 | |
| 7,127 | | | ResMed, Inc. | | | 603,586 | |
| 16,165 | | | Stryker Corp. | | | 2,502,989 | |
| 48,674 | | | UnitedHealth Group, Inc. | | | 10,730,670 | |
| 4,402 | | | Universal Health Services, Inc., Class B | | | 498,967 | |
| 4,602 | | | Varian Medical Systems, Inc.(2) | | | 511,512 | |
| 10,165 | | | Zimmer Biomet Holdings, Inc. | | | 1,226,611 | |
| | | | | | | | |
| | | | | | | 63,987,312 | |
| | | | | | | | |
| | | Household & Personal Products - 1.8% | |
| 12,544 | | | Church & Dwight Co., Inc. | | | 629,332 | |
| 6,476 | | | Clorox Co. (The) | | | 963,240 | |
| 44,105 | | | Colgate-Palmolive Co. | | | 3,327,722 | |
| 23,713 | | | Coty, Inc., Class A | | | 471,652 | |
| 11,244 | | | Estee Lauder Cos., Inc. (The), Class A | | | 1,430,687 | |
| 17,668 | | | Kimberly-Clark Corp. | | | 2,131,821 | |
| 127,984 | | | Procter & Gamble Co. (The) | | | 11,759,170 | |
| | | | | | | | |
| | | | | | | 20,713,624 | |
| | | | | | | | |
| | | Insurance - 2.6% | |
| 19,747 | | | Aflac, Inc. | | | 1,733,392 | |
| 18,023 | | | Allstate Corp. (The) | | | 1,887,188 | |
| 45,152 | | | American International Group, Inc. | | | 2,690,156 | |
| 12,552 | | | Aon plc | | | 1,681,968 | |
| 9,081 | | | Arthur J Gallagher & Co. | | | 574,646 | |
| 2,709 | | | Assurant, Inc. | | | 273,176 | |
| 4,817 | | | Brighthouse Financial, Inc.(2) | | | 282,469 | |
| 23,317 | | | Chubb Ltd. | | | 3,407,313 | |
| 7,502 | | | Cincinnati Financial Corp. | | | 562,425 | |
| 2,065 | | | Everest Re Group Ltd. | | | 456,902 | |
| 17,917 | | | Hartford Financial Services Group, Inc. (The)(3) | | | 1,008,369 | |
| 10,991 | | | Lincoln National Corp. | | | 844,878 | |
| 13,876 | | | Loews Corp. | | | 694,216 | |
| 25,634 | | | Marsh & McLennan Cos., Inc. | | | 2,086,351 | |
| 52,854 | | | MetLife, Inc. | | | 2,672,298 | |
| 13,488 | | | Principal Financial Group, Inc. | | | 951,713 | |
| 29,212 | | | Progressive Corp. (The) | | | 1,645,220 | |
| 21,296 | | | Prudential Financial, Inc. | | | 2,448,614 | |
| 5,393 | | | Torchmark Corp. | | | 489,199 | |
| 13,747 | | | Travelers Cos., Inc. (The) | | | 1,864,643 | |
| 11,270 | | | Unum Group | | | 618,610 | |
| 6,632 | | | Willis Towers Watson PLC | | | 999,376 | |
| 12,859 | | | XL Group Ltd. | | | 452,123 | |
| | | | | | | | |
| | | | | | | 30,325,245 | |
| | | | | | | | |
| | | Materials - 3.0% | |
| 10,947 | | | Air Products & Chemicals, Inc. | | | 1,796,184 | |
| 5,554 | | | Albemarle Corp. | | | 710,301 | |
| 4,444 | | | Avery Dennison Corp. | | | 510,438 | |
| 17,582 | | | Ball Corp. | | | 665,479 | |
| 11,726 | | | CF Industries Holdings, Inc. | | | 498,824 | |
| | | | | | | | |
Shares or Principal Amount | | Market Value(1) | |
COMMON STOCKS - 99.5% - (continued) | |
| | | Materials - 3.0% - (continued) | |
| 117,531 | | | DowDuPont, Inc. | | $ | 8,370,558 | |
| 7,219 | | | Eastman Chemical Co. | | | 668,768 | |
| 13,060 | | | Ecolab, Inc. | | | 1,752,391 | |
| 6,743 | | | FMC Corp. | | | 638,292 | |
| 67,646 | | | Freeport-McMoRan, Inc.(2) | | | 1,282,568 | |
| 3,970 | | | International Flavors & Fragrances, Inc. | | | 605,862 | |
| 20,739 | | | International Paper Co. | | | 1,201,618 | |
| 16,246 | | | LyondellBasell Industries N.V., Class A | | | 1,792,259 | |
| 3,159 | | | Martin Marietta Materials, Inc. | | | 698,265 | |
| 22,066 | | | Monsanto Co. | | | 2,576,867 | |
| 17,647 | | | Mosaic Co. (The) | | | 452,822 | |
| 26,808 | | | Newmont Mining Corp. | | | 1,005,836 | |
| 15,968 | | | Nucor Corp. | | | 1,015,245 | |
| 4,744 | | | Packaging Corp. of America | | | 571,889 | |
| 12,782 | | | PPG Industries, Inc. | | | 1,493,193 | |
| 14,382 | | | Praxair, Inc. | | | 2,224,608 | |
| 9,069 | | | Sealed Air Corp. | | | 447,102 | |
| 4,133 | | | Sherwin-Williams Co. (The) | | | 1,694,695 | |
| 6,650 | | | Vulcan Materials Co. | | | 853,661 | |
| 12,789 | | | WestRock Co. | | | 808,393 | |
| | | | | | | | |
| | | | | | | 34,336,118 | |
| | | | | | | | |
| | | Media - 2.7% | |
| 18,211 | | | CBS Corp., Class B | | | 1,074,449 | |
| 9,740 | | | Charter Communications, Inc., Class A(2) | | | 3,272,250 | |
| 234,276 | | | Comcast Corp., Class A | | | 9,382,754 | |
| 7,737 | | | Discovery Communications, Inc., Class A(2) | | | 173,154 | |
| 10,219 | | | Discovery Communications, Inc., Class C(2) | | | 216,336 | |
| 11,446 | | | DISH Network Corp., Class A(2) | | | 546,546 | |
| 19,519 | | | Interpublic Group of Cos., Inc. (The) | | | 393,503 | |
| 19,229 | | | News Corp., Class A | | | 311,702 | |
| 6,106 | | | News Corp., Class B | | | 101,360 | |
| 11,579 | | | Omnicom Group, Inc. | | | 843,299 | |
| 4,824 | | | Scripps Networks Interactive, Inc., Class A | | | 411,873 | |
| 39,104 | | | Time Warner, Inc. | | | 3,576,843 | |
| 52,915 | | | Twenty-First Century Fox, Inc., Class A | | | 1,827,155 | |
| 22,081 | | | Twenty-First Century Fox, Inc., Class B | | | 753,404 | |
| 17,733 | | | Viacom, Inc., Class B | | | 546,354 | |
| 75,859 | | | Walt Disney Co. (The) | | | 8,155,601 | |
| | | | | | | | |
| | | | | | | 31,586,583 | |
| | | | | | | | |
| | | Pharmaceuticals, Biotechnology & Life Sciences - 8.1% | |
| 80,067 | | | AbbVie, Inc. | | | 7,743,280 | |
| 16,155 | | | Agilent Technologies, Inc. | | | 1,081,900 | |
| 11,221 | | | Alexion Pharmaceuticals, Inc.(2) | | | 1,341,919 | |
| 16,705 | | | Allergan plc | | | 2,732,604 | |
| 36,460 | | | Amgen, Inc. | | | 6,340,394 | |
| 10,620 | | | Biogen, Inc.(2) | | | 3,383,213 | |
| 82,207 | | | Bristol-Myers Squibb Co. | | | 5,037,645 | |
| 39,545 | | | Celgene Corp.(2) | | | 4,126,916 | |
| 48,664 | | | Eli Lilly & Co. | | | 4,110,161 | |
| 65,610 | | | Gilead Sciences, Inc. | | | 4,700,300 | |
| 7,333 | | | Illumina, Inc.(2) | | | 1,602,187 | |
| 8,798 | | | Incyte Corp.(2) | | | 833,259 | |
| 7,313 | | | IQVIA Holdings, Inc.(2) | | | 715,943 | |
| 134,937 | | | Johnson & Johnson | | | 18,853,398 | |
| 137,380 | | | Merck & Co., Inc. | | | 7,730,373 | |
| 1,285 | | | Mettler-Toledo International, Inc.(2) | | | 796,083 | |
The accompanying Notes are an integral part of these financial statements.
Schedule of Investments – (continued)
December 31, 2017
| | | | | | | | |
Shares or Principal Amount | | Market Value(1) | |
COMMON STOCKS - 99.5% - (continued) | |
| | | Pharmaceuticals, Biotechnology & Life Sciences - 8.1% - (continued) | |
| 26,961 | | | Mylan N.V.(2) | | $ | 1,140,720 | |
| 5,541 | | | PerkinElmer, Inc. | | | 405,158 | |
| 6,579 | | | Perrigo Co. plc | | | 573,426 | |
| 299,390 | | | Pfizer, Inc. | | | 10,843,906 | |
| 3,869 | | | Regeneron Pharmaceuticals, Inc.(2) | | | 1,454,589 | |
| 20,141 | | | Thermo Fisher Scientific, Inc. | | | 3,824,373 | |
| 12,703 | | | Vertex Pharmaceuticals, Inc.(2) | | | 1,903,672 | |
| 3,995 | | | Waters Corp.(2) | | | 771,794 | |
| 24,475 | | | Zoetis, Inc. | | | 1,763,179 | |
| | | | | | | | |
| | | | | | | 93,810,392 | |
| | | | | | | | |
| | | Real Estate - 2.9% | |
| 4,808 | | | Alexandria Real Estate Equities, Inc., REIT | | | 627,877 | |
| 21,540 | | | American Tower Corp., REIT | | | 3,073,112 | |
| 7,894 | | | Apartment Investment & Management Co., Class A, REIT | | | 345,047 | |
| 6,936 | | | AvalonBay Communities, Inc., REIT | | | 1,237,452 | |
| 7,751 | | | Boston Properties, Inc., REIT | | | 1,007,863 | |
| 15,175 | | | CBRE Group, Inc., Class A, REIT(2) | | | 657,229 | |
| 20,406 | | | Crown Castle International Corp., REIT | | | 2,265,270 | |
| 10,319 | | | Digital Realty Trust, Inc., REIT | | | 1,175,334 | |
| 17,884 | | | Duke Realty Corp., REIT | | | 486,624 | |
| 3,929 | | | Equinix, Inc., REIT | | | 1,780,701 | |
| 18,458 | | | Equity Residential, REIT | | | 1,177,067 | |
| 3,318 | | | Essex Property Trust, Inc., REIT | | | 800,866 | |
| 6,330 | | | Extra Space Storage, Inc., REIT | | | 553,558 | |
| 3,644 | | | Federal Realty Investment Trust, REIT | | | 483,960 | |
| 31,360 | | | GGP, Inc., REIT | | | 733,510 | |
| 23,577 | | | HCP, Inc., REIT | | | 614,888 | |
| 37,172 | | | Host Hotels & Resorts, Inc., REIT | | | 737,864 | |
| 14,136 | | | Iron Mountain, Inc., REIT | | | 533,351 | |
| 21,400 | | | Kimco Realty Corp., REIT | | | 388,410 | |
| 5,444 | | | Macerich Co. (The), REIT | | | 357,562 | |
| 5,712 | | | Mid-America Apartment Communities, Inc., REIT | | | 574,399 | |
| 26,726 | | | Prologis, Inc., REIT | | | 1,724,094 | |
| 7,518 | | | Public Storage, REIT | | | 1,571,262 | |
| 14,153 | | | Realty Income Corp., REIT | | | 807,004 | |
| 7,439 | | | Regency Centers Corp., REIT | | | 514,630 | |
| 5,904 | | | SBA Communications Corp., REIT(2) | | | 964,477 | |
| 15,612 | | | Simon Property Group, Inc., REIT | | | 2,681,205 | |
| 4,936 | | | SL Green Realty Corp., REIT | | | 498,190 | |
| 13,452 | | | UDR, Inc., REIT | | | 518,171 | |
| 17,888 | | | Ventas, Inc., REIT | | | 1,073,459 | |
| 8,660 | | | Vornado Realty Trust, REIT | | | 677,039 | |
| 18,602 | | | Welltower, Inc., REIT | | | 1,186,250 | |
| 37,913 | | | Weyerhaeuser Co., REIT | | | 1,336,812 | |
| | | | | | | | |
| | | | | | | 33,164,537 | |
| | | | | | | | |
| | | Retailing - 5.7% | |
| 3,713 | | | Advance Auto Parts, Inc. | | | 370,149 | |
| 20,089 | | | Amazon.com, Inc.(2) | | | 23,493,483 | |
| 1,381 | | | AutoZone, Inc.(2) | | | 982,402 | |
| 12,774 | | | Best Buy Co., Inc. | | | 874,636 | |
| 9,158 | | | CarMax, Inc.(2) | | | 587,303 | |
| 13,085 | | | Dollar General Corp. | | | 1,217,036 | |
| 11,907 | | | Dollar Tree, Inc.(2) | | | 1,277,740 | |
| 6,175 | | | Expedia, Inc. | | | 739,580 | |
| 6,234 | | | Foot Locker, Inc. | | | 292,250 | |
| | | | | | | | |
Shares or Principal Amount | | Market Value(1) | |
COMMON STOCKS - 99.5% - (continued) | |
| | | Retailing - 5.7% - (continued) | |
| 10,937 | | | Gap, Inc. (The) | | $ | 372,514 | |
| 7,364 | | | Genuine Parts Co. | | | 699,654 | |
| 58,653 | | | Home Depot, Inc. (The) | | | 11,116,503 | |
| 8,475 | | | Kohl’s Corp. | | | 459,599 | |
| 12,403 | | | L Brands, Inc. | | | 746,909 | |
| 15,528 | | | LKQ Corp.(2) | | | 631,524 | |
| 41,830 | | | Lowe’s Cos., Inc. | | | 3,887,680 | |
| 15,312 | | | Macy’s, Inc. | | | 385,709 | |
| 21,735 | | | Netflix, Inc.(2) | | | 4,172,251 | |
| 5,850 | | | Nordstrom, Inc. | | | 277,173 | |
| 4,271 | | | O’Reilly Automotive, Inc.(2) | | | 1,027,346 | |
| 2,450 | | | Priceline Group, Inc. (The)(2) | | | 4,257,463 | |
| 19,367 | | | Ross Stores, Inc. | | | 1,554,202 | |
| 3,040 | | | Signet Jewelers Ltd. | | | 171,912 | |
| 27,302 | | | Target Corp. | | | 1,781,455 | |
| 5,133 | | | Tiffany & Co. | | | 533,575 | |
| 31,958 | | | TJX Cos., Inc. (The) | | | 2,443,509 | |
| 6,307 | | | Tractor Supply Co. | | | 471,448 | |
| 5,446 | | | TripAdvisor, Inc.(2) | | | 187,669 | |
| 2,934 | | | Ulta Salon Cosmetics & Fragrance, Inc.(2) | | | 656,218 | |
| | | | | | | | |
| | | | | | | 65,668,892 | |
| | | | | | | | |
| | | Semiconductors & Semiconductor Equipment - 3.9% | |
| 41,190 | | | Advanced Micro Devices, Inc.(2) | | | 423,433 | |
| 18,516 | | | Analog Devices, Inc. | | | 1,648,480 | |
| 53,567 | | | Applied Materials, Inc. | | | 2,738,345 | |
| 20,422 | | | Broadcom Ltd. | | | 5,246,412 | |
| 235,063 | | | Intel Corp. | | | 10,850,508 | |
| 7,871 | | | KLA-Tencor Corp. | | | 827,006 | |
| 8,134 | | | Lam Research Corp. | | | 1,497,225 | |
| 11,748 | | | Microchip Technology, Inc. | | | 1,032,414 | |
| 57,925 | | | Micron Technology, Inc.(2) | | | 2,381,876 | |
| 30,438 | | | NVIDIA Corp. | | | 5,889,753 | |
| 6,398 | | | Qorvo, Inc.(2) | | | 426,107 | |
| 74,043 | | | QUALCOMM, Inc. | | | 4,740,233 | |
| 9,237 | | | Skyworks Solutions, Inc. | | | 877,053 | |
| 49,502 | | | Texas Instruments, Inc. | | | 5,169,989 | |
| 12,605 | | | Xilinx, Inc. | | | 849,829 | |
| | | | | | | | |
| | | | | | | 44,598,663 | |
| | | | | | | | |
| | | Software & Services - 14.1% | |
| 31,040 | | | Accenture plc, Class A | | | 4,751,914 | |
| 37,977 | | | Activision Blizzard, Inc. | | | 2,404,704 | |
| 24,759 | | | Adobe Systems, Inc.(2) | | | 4,338,767 | |
| 8,496 | | | Akamai Technologies, Inc.(2) | | | 552,580 | |
| 2,414 | | | Alliance Data Systems Corp. | | | 611,901 | |
| 14,970 | | | Alphabet, Inc., Class A(2) | | | 15,769,398 | |
| 15,162 | | | Alphabet, Inc., Class C(2) | | | 15,865,517 | |
| 4,261 | | | ANSYS, Inc.(2) | | | 628,881 | |
| 11,009 | | | Autodesk, Inc.(2) | | | 1,154,073 | |
| 22,275 | | | Automatic Data Processing, Inc. | | | 2,610,407 | |
| 15,767 | | | CA, Inc. | | | 524,726 | |
| 14,182 | | | Cadence Design Systems, Inc.(2) | | | 593,091 | |
| 7,190 | | | Citrix Systems, Inc.(2) | | | 632,720 | |
| 29,616 | | | Cognizant Technology Solutions Corp., Class A | | | 2,103,328 | |
| 8,218 | | | CSRA, Inc. | | | 245,883 | |
| 14,328 | | | DXC Technology Co. | | | 1,359,727 | |
| 48,793 | | | eBay, Inc.(2) | | | 1,841,448 | |
| 15,466 | | | Electronic Arts, Inc.(2) | | | 1,624,858 | |
| 119,782 | | | Facebook, Inc., Class A(2) | | | 21,136,732 | |
The accompanying Notes are an integral part of these financial statements.
Schedule of Investments – (continued)
December 31, 2017
| | | | | | | | |
Shares or Principal Amount | | Market Value(1) | |
COMMON STOCKS - 99.5% - (continued) | |
| | | Software & Services - 14.1% - (continued) | |
| 16,769 | | | Fidelity National Information Services, Inc. | | $ | 1,577,795 | |
| 10,467 | | | Fiserv, Inc.(2) | | | 1,372,538 | |
| 4,555 | | | Gartner, Inc.(2) | | | 560,948 | |
| 7,993 | | | Global Payments, Inc. | | | 801,218 | |
| 43,245 | | | International Business Machines Corp. | | | 6,634,648 | |
| 12,199 | | | Intuit, Inc. | | | 1,924,758 | |
| 46,651 | | | MasterCard, Inc., Class A | | | 7,061,095 | |
| 387,482 | | | Microsoft Corp. | | | 33,145,210 | |
| 153,024 | | | Oracle Corp. | | | 7,234,975 | |
| 16,063 | | | Paychex, Inc. | | | 1,093,569 | |
| 56,746 | | | PayPal Holdings, Inc.(2) | | | 4,177,640 | |
| 8,888 | | | Red Hat, Inc.(2) | | | 1,067,449 | |
| 34,465 | | | salesforce.com, Inc.(2) | | | 3,523,357 | |
| 31,140 | | | Symantec Corp. | | | 873,788 | |
| 7,553 | | | Synopsys, Inc.(2) | | | 643,818 | |
| 8,403 | | | Total System Services, Inc. | | | 664,593 | |
| 4,258 | | | VeriSign, Inc.(2) | | | 487,285 | |
| 91,085 | | | Visa, Inc., Class A | | | 10,385,512 | |
| 23,069 | | | Western Union Co. (The) | | | 438,542 | |
| | | | | | | | |
| | | | | | | 162,419,393 | |
| | | | | | | | |
| | | Technology Hardware & Equipment - 5.7% | |
| 15,336 | | | Amphenol Corp., Class A | | | 1,346,501 | |
| 257,882 | | | Apple, Inc. | | | 43,641,371 | |
| 248,304 | | | Cisco Systems, Inc. | | | 9,510,043 | |
| 43,650 | | | Corning, Inc. | | | 1,396,363 | |
| 3,144 | | | F5 Networks, Inc.(2) | | | 412,556 | |
| 6,960 | | | FLIR Systems, Inc. | | | 324,475 | |
| 80,112 | | | Hewlett Packard Enterprise Co. | | | 1,150,408 | |
| 83,892 | | | HP, Inc. | | | 1,762,571 | |
| 18,832 | | | Juniper Networks, Inc. | | | 536,712 | |
| 8,137 | | | Motorola Solutions, Inc. | | | 735,097 | |
| 13,562 | | | NetApp, Inc. | | | 750,250 | |
| 14,532 | | | Seagate Technology plc | | | 608,019 | |
| 17,662 | | | TE Connectivity Ltd. | | | 1,678,596 | |
| 14,857 | | | Western Digital Corp. | | | 1,181,577 | |
| 10,733 | | | Xerox Corp. | | | 312,867 | |
| | | | | | | | |
| | | | | | | 65,347,406 | |
| | | | | | | | |
| | | Telecommunication Services - 2.1% | | | |
| 308,395 | | | AT&T, Inc. | | | 11,990,398 | |
| 48,850 | | | CenturyLink, Inc. | | | 814,818 | |
| 204,895 | | | Verizon Communications, Inc. | | | 10,845,092 | |
| | | | | | | | |
| | | | | | | 23,650,308 | |
| | | | | | | | |
| | | Transportation - 2.2% | | | |
| 6,180 | | | Alaska Air Group, Inc. | | | 454,292 | |
| 21,390 | | | American Airlines Group, Inc. | | | 1,112,922 | |
| 7,002 | | | CH Robinson Worldwide, Inc. | | | 623,808 | |
| 44,889 | | | CSX Corp. | | | 2,469,344 | |
| 32,946 | | | Delta Air Lines, Inc. | | | 1,844,976 | |
| 8,926 | | | Expeditors International of Washington, Inc. | | | 577,423 | |
| 12,391 | | | FedEx Corp. | | | 3,092,050 | |
| 4,300 | | | JB Hunt Transport Services, Inc. | | | 494,414 | |
| 5,201 | | | Kansas City Southern | | | 547,249 | |
| 14,372 | | | Norfolk Southern Corp. | | | 2,082,503 | |
| 27,420 | | | Southwest Airlines Co. | | | 1,794,639 | |
| 39,537 | | | Union Pacific Corp. | | | 5,301,912 | |
| 12,648 | | | United Continental Holdings, Inc.(2) | | | 852,475 | |
| 34,509 | | | United Parcel Service, Inc., Class B | | | 4,111,747 | |
| | | | | | | | |
| | | | | | | 25,359,754 | |
| | | | | | | | |
| | | | | | | | |
Shares or Principal Amount | | Market Value(1) | |
COMMON STOCKS - 99.5% - (continued) | |
| | | Utilities - 2.9% | |
| 33,194 | | | AES Corp. | | $ | 359,491 | |
| 11,606 | | | Alliant Energy Corp. | | | 494,532 | |
| 12,187 | | | Ameren Corp. | | | 718,911 | |
| 24,704 | | | American Electric Power Co., Inc. | | | 1,817,473 | |
| 8,963 | | | American Water Works Co., Inc. | | | 820,025 | |
| 21,650 | | | CenterPoint Energy, Inc. | | | 613,994 | |
| 14,165 | | | CMS Energy Corp. | | | 670,005 | |
| 15,577 | | | Consolidated Edison, Inc. | | | 1,323,266 | |
| 32,323 | | | Dominion Energy, Inc. | | | 2,620,102 | |
| 9,010 | | | DTE Energy Co. | | | 986,235 | |
| 35,153 | | | Duke Energy Corp. | | | 2,956,719 | |
| 16,365 | | | Edison International | | | 1,034,923 | |
| 9,054 | | | Entergy Corp. | | | 736,905 | |
| 15,916 | | | Eversource Energy | | | 1,005,573 | |
| 48,223 | | | Exelon Corp. | | | 1,900,468 | |
| 22,337 | | | FirstEnergy Corp. | | | 683,959 | |
| 23,627 | | | NextEra Energy, Inc. | | | 3,690,301 | |
| 16,916 | | | NiSource, Inc. | | | 434,234 | |
| 15,114 | | | NRG Energy, Inc. | | | 430,447 | |
| 25,758 | | | PG&E Corp. | | | 1,154,731 | |
| 5,613 | | | Pinnacle West Capital Corp. | | | 478,115 | |
| 34,314 | | | PPL Corp. | | | 1,062,018 | |
| 25,418 | | | Public Service Enterprise Group, Inc. | | | 1,309,027 | |
| 7,163 | | | SCANA Corp. | | | 284,944 | |
| 12,611 | | | Sempra Energy | | | 1,348,368 | |
| 50,409 | | | Southern Co. (The) | | | 2,424,169 | |
| 15,851 | | | WEC Energy Group, Inc. | | | 1,052,982 | |
| 25,504 | | | Xcel Energy, Inc. | | | 1,226,997 | |
| | | | | | | | |
| | | | | | | 33,638,914 | |
| | | | | | | | |
| | |
| | | | Total Common Stocks (cost $534,983,794) | | | 1,145,461,041 | |
| | | | | | | | |
| | |
| | | | Total Long-Term Investments (cost $534,983,794) | | | 1,145,461,041 | |
| | | | | | | | |
|
SHORT-TERM INVESTMENTS - 0.5% | |
| | | Repurchase Agreements - 0.5% | | | |
| | | | RBC Capital Markets LLC TriParty Repurchase Agreement (dated 12/29/2017, repurchase price $6,001,900, collateralized by U.S. Treasury Inflation Index Bonds 0.75% - 1.00%, 2045 - 2046, U.S. Treasury Inflation Index Note 0.38%, 2025, value of $6,104,443) | | | | |
$ | 6,001,000 | | | 1.35%, 01/02/2018 | | | 6,001,000 | |
| | | | | | | | |
| | |
| | | | Total Short-Term investments (cost $6,001,000) | | | 6,001,000 | |
| | | | | | | | |
| | | | | | | | | | | | |
| | | |
| | | | Total Investments (cost $540,984,794) | | | 100.0 | % | | $ | 1,151,462,041 | |
| | | | Other Assets and Liabilities | | | — | % | | | 115,358 | |
| | | | | | | | | | | | |
| | | | Net Assets | | | 100.0 | % | | $ | 1,151,577,399 | |
| | | | | | | | | | | | |
The accompanying Notes are an integral part of these financial statements.
Schedule of Investments – (concluded)
December 31, 2017
Note: | Percentage of investments as shown is the ratio of the total market value to total net assets. |
| The Fund may refer to any one or more of the industry classifications used by one or more widely recognized market indices, ratings group indices and/or as defined by Fund management. Industry classifications may not be identical across all security types. |
| Equity industry classifications used in this report are the Global Industry Classification Standard (GICS®), which was developed by and is the exclusive property and service mark of MSCI, Inc. and S&P. |
| For Fund compliance purposes, the Fund may not use the same classification system shown in this report as these classifications are used for reporting ease. |
(1) | See Significant Accounting Policies of accompanying Notes to Financial Statements regarding valuation of securities. |
(2) | Non-income producing. |
(3) | Affiliated company as defined under Sections 2(a)(2) and 2(a)(3) of the Investment Company Act of 1940. Hartford Investment Management Company, the Fund’s adviser, is a wholly-owned subsidiary of The Hartford Financial Services Group, Inc. A summary of transactions for the year ended December 31, 2017 is as follows: |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Company | | Beginning Value At January 1, 2017 | | | Purchase Cost | | | Sales Proceeds | | | Realized Gain (Loss) | | | Unrealized Gain (Loss) | | | Ending Value At December 31, 2017 | | | Dividend Income | |
Hartford Financial Services Group, Inc. (The) | | $ | 984,497 | | | $ | — | | | $ | (143,987) | | | $ | 32,100 | | | $ | 135,759 | | | $ | 1,008,369 | | | $ | 18,280 | |
Futures Contracts Outstanding at December 31, 2017
| | | | | | | | | | | | | | | | | | | | |
Description | | Number of Contracts | | | Expiration Date | | | Notional Amount | | | Value | | | Unrealized Appreciation/ (Depreciation) | |
Long position contracts: | | | | | | | | | | | | | | | | | | | | |
S&P 500 (E-Mini) | | | 54 | | | | 03/16/2018 | | | $ | 7,182,722 | | | $ | 7,225,217 | | | $ | 42,495 | |
| Cash of $610,000 was pledged as initial margin deposit and collateral for the daily variation margin on open futures contracts at December 31, 2017. |
| | |
GLOSSARY: (abbreviations used in preceding Schedule of Investments) |
| | |
|
Index Abbreviations: |
MSCI | | Morgan Stanley Capital International |
S&P | | Standard & Poor’s |
|
Other Abbreviations: |
ETF | | Exchange Traded Fund |
REIT | | Real Estate Investment Trust |
| | |
|
Counterparty Abbreviations: |
RBC | | RBC Dominion Securities |
Investment Valuation Hierarchy Level Summary at December 31, 2017
| | | | | | | | | | | | | | | | |
Description | | Total | | | Level 1(1) | | | Level 2(1) | | | Level 3(1) | |
Assets: | | | | | | | | | | | | | | | | |
Common Stocks(2) | | $ | 1,145,461,041 | | | $ | 1,145,461,041 | | | $ | — | | | $ | — | |
Short-Term Investments | | | 6,001,000 | | | | — | | | | 6,001,000 | | | | — | |
| | | | | | | | | | | | | | | | |
Total | | $ | 1,151,462,041 | | | $ | 1,145,461,041 | | | $ | 6,001,000 | | | $ | — | |
| | | | | | | | | | | | | | | | |
Futures(3) | | $ | 42,495 | | | $ | 42,495 | | | $ | — | | | $ | — | |
| | | | | | | | | | | | | | | | |
Total | | $ | 42,495 | | | $ | 42,495 | | | $ | — | | | $ | — | |
| | | | | | | | | | | | | | | | |
(1) | For the year ended December 31, 2017, there were no transfers between any levels. |
(2) | Refer to the Schedule of Investments for further industry breakout. |
(3) | Derivative instruments (excluding purchased and written options, if applicable) are valued at the unrealized appreciation/depreciation on the investments. |
Note: | For purposes of reporting transfers between different hierarchy levels, both transfers in and out of each level, as applicable, are shown as if they occurred at the beginning of the period. |
The accompanying Notes are an integral part of these financial statements.
Statement of Assets and Liabilities
December 31, 2017
| | | | |
Assets: | |
Investments in unaffiliated securities, at market value (cost $540,254,228) | | $ | 1,150,453,672 | |
Investments in affiliated securities, at market value (cost $730,566) | | | 1,008,369 | |
Cash(1) | | | 616,696 | |
Receivables: | | | | |
Fund shares sold | | | 66,111 | |
Dividends and interest | | | 1,163,498 | |
Other assets | | | 888,106 | |
| | | | |
Total assets | | | 1,154,196,452 | |
| | | | |
Liabilities: | |
Payables: | | | | |
Fund shares redeemed | | | 2,056,347 | |
Investment management fees | | | 235,581 | |
Variation margin on futures contracts | | | 26,151 | |
Distribution fees | | | 84,589 | |
Trustees fees | | | 1,582 | |
Accrued expenses | | | 214,803 | |
| | | | |
Total liabilities | | | 2,619,053 | |
| | | | |
Net assets | | $ | 1,151,577,399 | |
| | | | |
Summary of Net Assets: | |
Capital stock and paid-in-capital | | $ | 486,154,209 | |
Undistributed net investment income | | | 17,700,068 | |
Accumulated net realized gain | | | 37,203,380 | |
Unrealized appreciation of investments | | | 610,519,742 | |
| | | | |
Net assets | | $ | 1,151,577,399 | |
| | | | |
Class IA: Net asset value per share | | $ | 46.70 | |
| | | | |
Shares Outstanding | | | 16,184,173 | |
| | | | |
Net Assets | | $ | 755,847,953 | |
| | | | |
Class IB: Net asset value per share | | $ | 45.98 | |
| | | | |
Shares Outstanding | | | 8,606,547 | |
| | | | |
Net Assets | | $ | 395,729,446 | |
| | | | |
(1) | Cash of $610,000 was pledged as initial margin deposit and collateral for the daily variation margin on open futures contracts at December 31, 2017. |
The accompanying Notes are an integral part of these financial statements.
Statement of Operations
For the Year Ended December 31, 2017
| | | | |
Investment Income: | |
Dividends from unaffiliated securities | | $ | 22,663,796 | |
Dividends from affiliated securities | | | 18,280 | |
Interest | | | 70,681 | |
| | | | |
Total investment income, net | | | 22,752,757 | |
| | | | |
Expenses: | |
Investment management fees | | | 3,334,728 | |
Transfer agent fees | | | 15,653 | |
Distribution fees - Class IB | | | 984,574 | |
Custodian fees | | | 26,757 | |
Accounting service fees | | | 320,726 | |
Trustees fees | | | 140,606 | |
Audit fees | | | 91,790 | |
Printing fees | | | 74,050 | |
Legal fees | | | 124,509 | |
Insurance fees | | | 65,494 | |
Other expenses | | | 75,480 | |
| | | | |
Total expenses (before waivers) | | | 5,254,367 | |
| | | | |
Total waivers | | | (601,066 | ) |
| | | | |
Total expenses | | | 4,653,301 | |
| | | | |
Net Investment Income | | | 18,099,456 | |
| | | | |
Net Realized Gain on Investments and Other Financial Instruments: | |
Net realized gain on investments in unaffiliated securities | | | 65,619,668 | |
Net realized gain on investments in affiliated securities | | | 32,100 | |
Net realized gain on futures | | | 1,856,081 | |
| | | | |
Net Realized Gain on Investments and Other Financial Instruments | | | 67,507,849 | |
| | | | |
Net Changes in Unrealized Appreciation of Investments and Other Financial Instruments: | |
Net unrealized appreciation of investments | | | 129,185,921 | |
Net unrealized appreciation of futures contracts | | | 59,959 | |
| | | | |
Net Changes in Unrealized Appreciation of Investments and Other Financial Instruments | | | 129,245,880 | |
| | | | |
Net Realized and Unrealized Gain on Investments and Other Financial Instruments | | | 196,753,729 | |
| | | | |
Net Increase in Net Assets Resulting from Operations | | $ | 214,853,185 | |
| | | | |
The accompanying Notes are an integral part of these financial statements.
Statements of Changes in Net Assets
| | | | | | | | |
| | For the Year Ended December 31, 2017 | | | For the Year Ended December 31, 2016 | |
Operations: | |
Net investment income | | $ | 18,099,456 | | | $ | 19,187,983 | |
Net realized gain on investments and other financial instruments | | | 67,507,849 | | | | 67,798,334 | |
Net unrealized appreciation of investments and other financial instruments | | | 129,245,880 | | | | 24,458,604 | |
| | | | | | | | |
Net Increase in Net Assets Resulting from Operations | | | 214,853,185 | | | | 111,444,921 | |
| | | | | | | | |
Distributions to Shareholders: | |
From net investment income | |
Class IA | | | (12,747,152 | ) | | | (13,966,007 | ) |
Class IB | | | (7,046,747 | ) | | | (8,249,355 | ) |
| | | | | | | | |
Total distributions from net investment income | | | (19,793,899 | ) | | | (22,215,362 | ) |
| | | | | | | | |
From net realized gain on investments | |
Class IA | | | (40,622,917 | ) | | | (46,415,619 | ) |
Class IB | | | (22,456,734 | ) | | | (27,416,493 | ) |
| | | | | | | | |
Total distributions from net realized gain on investments | | | (63,079,651 | ) | | | (73,832,112 | ) |
| | | | | | | | |
Total distributions | | | (82,873,550 | ) | | | (96,047,474 | ) |
| | | | | | | | |
Capital Share Transactions: | |
Class IA | |
Sold | | | 24,666,115 | | | | 21,673,449 | |
Issued on reinvestment of distributions | | | 53,370,069 | | | | 60,381,626 | |
Redeemed | | | (85,484,743 | ) | | | (96,689,732 | ) |
| | | | | | | | |
Total capital share transactions | | | (7,448,559 | ) | | | (14,634,657 | ) |
| | | | | | | | |
Class IB | |
Sold | | | 23,656,244 | | | | 20,176,793 | |
Issued on reinvestment of distributions | | | 29,503,481 | | | | 35,665,848 | |
Redeemed | | | (84,739,490 | ) | | | (93,903,225 | ) |
| | | | | | | | |
Total capital share transactions | | | (31,579,765 | ) | | | (38,060,584 | ) |
| | | | | | | | |
Net decrease from capital share transactions | | | (39,028,324 | ) | | | (52,695,241 | ) |
| | | | | | | | |
Net Increase (Decrease) in Net Assets | | | 92,951,311 | | | | (37,297,794 | ) |
| | | | | | | | |
Net Assets: | |
Beginning of period | | | 1,058,626,088 | | | | 1,095,923,882 | |
| | | | | | | | |
End of period | | $ | 1,151,577,399 | | | $ | 1,058,626,088 | |
| | | | | | | | |
Undistributed net investment income | | $ | 17,700,068 | | | $ | 18,623,721 | |
| | | | | | | | |
Shares: | |
Class IA | |
Sold | | | 551,836 | | | | 529,762 | |
Issued on reinvestment of distributions | | | 1,265,593 | | | | 1,499,047 | |
Redeemed | | | (1,918,202 | ) | | | (2,384,897 | ) |
| | | | | | | | |
Total share activity | | | (100,773 | ) | | | (356,088 | ) |
| | | | | | | | |
Class IB | |
Sold | | | 544,452 | | | | 504,675 | |
Issued on reinvestment of distributions | | | 709,901 | | | | 895,227 | |
Redeemed | | | (1,930,553 | ) | | | (2,344,051 | ) |
| | | | | | | | |
Total share activity | | | (676,200 | ) | | | (944,149 | ) |
| | | | | | | | |
The accompanying Notes are an integral part of these financial statements.
Notes to Financial Statements
December 31, 2017
HIMCO Variable Insurance Trust (the “Trust”) is an open-end registered management investment company. The Trust is organized under the laws of the State of Delaware and is registered with the Securities and Exchange Commission (“SEC”) under the Investment Company Act of 1940, as amended (“1940 Act”).
HIMCO VIT Index Fund (the “Fund”) serves as an underlying investment option for certain variable annuity and variable life insurance separate accounts of Hartford Life Insurance Company (“Hartford Life”) and its affiliates and certain qualified retirement plans. The Fund may also serve as an underlying investment option for certain variable annuity and variable life separate accounts of other insurance companies. Owners of variable annuity contracts and policyholders of variable life insurance contracts may choose the funds permitted in the variable insurance contract prospectus. In addition, participants in certain qualified retirement plans may choose the Fund if permitted by their plans.
The Fund is a series of the Trust. The Fund is the successor of a series of Hartford Series Fund, Inc. (the “Hartford Index HLS Fund”). The reorganization of the Hartford Index HLS Fund with and into the Fund occurred on October 20, 2014. All information regarding and references to periods prior to October 20, 2014 relate to the Hartford Index HLS Fund. The Fund is a diversified open-end management investment company and applies specialized accounting and reporting under Accounting Standards Codification Topic 946, Financial Services – Investment Companies. The Fund is authorized to issue an unlimited number of shares for each class.
The Fund is divided into Class IA and Class IB shares. Each class is offered at the per share net asset value (“NAV”) without a sales charge and is subject to the same expenses, except that the Class IB shares are subject to distribution and service fees charged pursuant to a distribution plan (the “Distribution Plan”) approved by the Board of Trustees in accordance with Rule 12b-1 under the 1940 Act and the requirements of the applicable market conduct rules of the Financial Industry Regulatory Authority concerning asset-based sales charges.
2. | Significant Accounting Policies: |
The following is a summary of significant accounting policies followed by the Fund in the preparation of its financial statements, which are in accordance with United States Generally Accepted Accounting Principles (“U.S. GAAP”). The preparation of financial statements in accordance with U.S. GAAP may require management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of increases and decreases in net assets resulting from operations during the reporting period. Actual results could differ from those estimates.
| a) | Determination of Net Asset Value – The NAV of each class of the Fund’s shares is determined as of the close of regular trading on the New York Stock Exchange (the “Exchange”) (normally 4:00 p.m. Eastern Time) (the “NYSE Close”) on each day that the Exchange is open (“Valuation Date”). If the Exchange is closed due to weather or other extraordinary circumstances on a day it would typically be open for business, the Fund will treat such day as a typical business day and accept purchase and redemption orders and calculate the Fund’s NAV as of 4:00 p.m. Eastern Time. The NAV for each class of shares is determined by dividing the value of the Fund’s net assets attributable to a class of shares by the number of shares outstanding for that class. For any day where, due to technical or other issues, trading is halted before the scheduled close of the Exchange, and not as part of a trading halt that is effected on a market-wide basis, the Fund may elect to continue to treat the Valuation Date as occurring at the time of the schedule close of the Exchange. Information that becomes known to the Fund after the NAV has been calculated on a particular day will not generally be used to retroactively adjust the NAV determined earlier that day. |
| b) | Investment Valuation and Fair Value Measurements – For purposes of calculating the NAV, portfolio securities and other assets held in the Fund’s portfolio for which market prices are readily available are valued at market value. Market value is generally determined on the basis of last reported sales prices or official close price. If no sales were reported, market value is based on prices obtained from independent pricing services, a quotation reporting system or established market makers. If market prices are not readily available or are deemed unreliable, the Fund will use the fair value of the security or other instrument as determined in good faith under policies and procedures established by and under the supervision of the Board of Trustees. Market prices are considered not readily available where there is an absence of |
Notes to Financial Statements – (continued)
December 31, 2017
| current or reliable market-based data (e.g., trade information or broker quotes), including where events occur after the close of the relevant market, but prior to the NYSE Close that materially affect the values of the Fund’s portfolio holdings or assets. In addition, market prices are considered not readily available when, due to extraordinary circumstances, the exchanges or markets on which the securities or other instruments trade do not open for trading for the entire day and no other market prices are available. Securities and other instruments that are primarily traded on foreign markets may trade on days that are not business days of the Fund. The value of the foreign securities or other instruments in which the Fund invests may change on days when a shareholder will not be able to purchase or redeem shares of the Fund. Fair value pricing is subjective in nature and the use of fair value pricing by the Fund may cause the NAV of its shares to differ significantly from the NAV that would have been calculated using market prices at the close of the exchange on which a portfolio holding is primarily traded. There can be no assurance that the Fund could obtain the fair value assigned to an investment if the Fund were to sell the investment at approximately the time at which the Fund determines its NAV. |
Fixed income securities, including those with a remaining maturity of less than sixty (60 days), and non-exchange traded derivatives held by the Fund are valued in accordance with procedures established by the Board of Trustees. Such investments are normally valued on the basis of quotes obtained from independent pricing services or brokers and dealers. Prices obtained from independent pricing services use information provided by market makers or estimates of market values obtained from yield data relating to investments or securities with similar characteristics. Senior floating rate interests generally trade in over-the-counter (“OTC”) markets and are priced through an independent pricing service utilizing independent market quotations from loan dealers or financial institutions. Generally, the Fund may use fair valuation in regard to fixed income positions when the Fund holds defaulted or distressed investments or investments in a company in which a reorganization is pending. If pricing services do not provide a price for short term investments maturing in 60 days or less, such investments are generally valued at amortized cost if their original term to maturity was 60 days or less, or by amortizing their value on the 61st day prior to maturity, if the original term exceeded 60 days.
If pricing services do not provide a price for short term investments maturing in 60 days or less, such investments are generally valued at amortized cost if their original term to maturity was 60 days or less, or by amortizing their value on the 61st day prior to maturity, if the original term exceeded 60 days.
Exchange traded futures, options and options on futures are valued in accordance with procedures established by the Board of Trustees. Such instruments are normally valued on the basis of quotes obtained from independent pricing services. Prices obtained from independent pricing services use most recent settlement prices and/or bid and ask prices for futures; and last sale prices and bid and ask prices for options and options on futures. If pricing services are not able to provide prices for futures, such instruments will generally be valued at the most recent trade price as of the NYSE Close. If pricing services are not able to provide prices for options and options on futures, such instruments will generally be valued on the basis of quotes obtained from brokers, dealers or market makers. If the option is out of the money, within 30 days of expiration and no bid price is available, the option may be valued at zero. If such instruments do not trade on an exchange, values may be supplied by an independent pricing service using a formula or other objective method that may take into consideration the style, direction, expiration, strike price, notional value and volatility or other adjustments.
U.S. GAAP defines fair value as the price that the Fund would receive to sell an asset or pay to transfer a liability in an orderly transaction between market participants at the measurement date. The U.S. GAAP fair value measurement standards require disclosure of a fair value hierarchy for each major category of assets and liabilities. Various inputs are used in determining the fair value of the Fund’s investments. These inputs are summarized into three broad hierarchy levels. This hierarchy is based on whether the valuation inputs are observable or unobservable. The determination of which category within the fair value hierarchy is appropriate for any given instrument is based on the lowest level of input that is significant to the fair value measurement. These levels are:
| • | | Level 1 – Inputs using (unadjusted) quoted prices in active markets or exchanges for identical assets and liabilities. Level 1 may include exchange traded instruments, such as domestic equities, some foreign equities, options, futures, investment companies, exchange traded funds, rights and warrants. |
| • | | Level 2 – Observable inputs other than Level 1 prices, which may include, but are not limited to, quoted prices for similar assets or liabilities in markets that are active, quoted prices for identical or similar assets or liabilities in |
Notes to Financial Statements – (continued)
December 31, 2017
| markets that are not active, inputs other than quoted prices that are observable for the assets or liabilities or other market corroborated inputs. Level 2 may include debt investments that are traded less frequently than exchange traded instruments and are valued using independent pricing services; foreign equities, which are principally traded on certain foreign markets and are adjusted daily pursuant to a fair value pricing service in order to reflect an adjustment for the factors occurring after the close of certain foreign markets but before the NYSE Close; senior floating rate interests, which are valued using an aggregate of dealer bids; short-term investments, which are valued at amortized cost; and swaps, which are valued based upon the terms of each swap contract. |
| • | | Level 3 – Significant unobservable inputs based on the best information available in the circumstances, to the extent observable inputs are not available. Level 3 may include financial instruments whose values are determined using indicative market quotes or require significant management judgment or estimation. These unobservable valuation inputs may include estimates for current yields, maturity/duration, prepayment speed, and indicative market quotes for comparable investments along with other assumptions relating to credit quality, collateral value, complexity of the investment structure, general market conditions and liquidity. This category may include investments where trading has been halted or there are certain restrictions on trading. While these investments are priced using unobservable inputs, the valuation of these investments reflects the best available data and management believes the prices are a reasonable representation of exit price. |
The procedures adopted by the Board of Trustees define how investments are to be valued, including the formation and activities of a Valuation Committee. The Valuation Committee has the overall responsibility for implementing the procedures adopted by the Board of Trustees, including the responsibility for determining the fair value of the Fund’s investments. The Valuation Committee is also responsible for determining in good faith the fair value of an investment when the value cannot be obtained from primary pricing services or alternative sources or if the valuation of an investment, as provided by the primary pricing service or alternative source, is believed not to reflect the investment’s fair value as of the Valuation Date.
The Valuation Committee is comprised of the Trust’s Chief Executive Officer, Treasurer, Chief Operating Officer, and Chief Legal Officer, or their designees, and other personnel of the investment manager subject to prior approval by the Board of Trustees. In addition, the Trust’s Chief Compliance Officer (“CCO”) shall designate a member of the compliance group to attend Valuation Committee meetings as a non-voting resource, to monitor for and provide guidance with respect to compliance with these procedures and to keep the Trust’s CCO regularly informed of pricing and Valuation Committee proceedings. Two members of the Valuation Committee or their designees, representing different departments, shall constitute a quorum for purposes of permitting the Committee to take action. The Valuation Committee will consider all relevant factors in determining an investment’s fair value, and may seek the advice of the Fund’s adviser, knowledgeable brokers, and legal counsel in making such determination.
At each quarterly meeting of the Board of Trustees, the Valuation Committee provides a written report that includes details of all fair-valued investments to the extent any are fair-valued, including the reason for the fair valuation, and an indication, when possible, of the accuracy of the valuation by disclosing the next available reliable public price quotation or the disposition price of such investments (the “look-back” review). The Board of Trustees then must consider for ratification all of the fair value determinations made during the previous quarter.
Valuation levels are not necessarily indicative of the risk associated with investing in such investments. Individual investments within any of the above mentioned asset classes may be assigned a different hierarchical level than those presented above, as individual circumstances dictate.
For additional information, refer to the Investment Valuation Hierarchy Level Summary included in the Schedule of Investments.
| c) | Investment Transactions and Investment Income – Investment transactions are recorded as of the trade date (the date the order to buy or sell is executed) for financial reporting purposes. Investments purchased or sold on a when-issued or delayed-delivery basis may be settled a month or more after the trade date. Realized gains and losses are determined on the basis of identified cost. |
Dividend income from domestic securities is recorded on the ex-dividend date. Interest income, including amortization of premium, accretion of discounts and additional principal received in-kind in lieu of cash, is accrued on a daily basis.
Notes to Financial Statements – (continued)
December 31, 2017
| d) | Fund Share Valuation and Dividend Distributions to Shareholders – Orders for the Fund’s shares are executed in accordance with the investment instructions of the contract holders and plan participants. Each class of shares offered by the Fund has equal rights as to assets and voting privileges (except that shareholders of a class have exclusive voting rights regarding any matter relating solely to that class of shares). Income and non-class specific expenses are allocated daily to each class on the basis of the relative net assets of the class. Realized and unrealized gains and losses are allocated daily based on the relative net assets of each class of shares of the Fund. |
Orders for the purchase of the Fund’s shares received prior to the close of the Exchange on any day the Exchange is open for business are priced at the NAV determined as of the close of the Exchange. Orders received after the close of the Exchange, or on a day on which the Exchange and/or the Fund is not open for business, are priced at the next determined NAV.
Dividends are declared pursuant to a policy adopted by the Board of Trustees based upon the investment performance of the Fund. The policy of the Fund is to pay dividends from net investment income and to make distributions of realized gains, if any, at least once per year.
Distributions from net investment income, realized capital gains and capital are determined in accordance with federal income tax regulations, which may differ from U.S. GAAP with respect to character and timing. These differences may include, but are not limited to, losses deferred due to wash sale adjustments, foreign currency gains and losses, adjustments related to Passive Foreign Investment Companies (“PFICs”), Real Estate Investment Trusts (“REITs”), Regulated Investment Companies (“RICs”), certain derivatives and partnerships. Permanent book and federal income tax basis differences relating to shareholder distributions will result in reclassifications to certain of the Fund’s capital accounts (see Federal Income Taxes: Reclassification of Capital Accounts note).
3. | Securities and Other Investments: |
| a) | Repurchase Agreements and Reverse Repurchase Agreements – A repurchase agreement is an agreement by which a counterparty agrees to sell an investment and agrees to repurchase the investment sold from the buyer, the Fund, at a mutually agreed upon time and price. A reverse repurchase agreement is an agreement by which the Fund agrees to sell an investment and agrees to repurchase the investment sold from the buyer, the counterparty, at a mutually agreed upon time and price. During the period of the repurchase agreement, the counterparty will deposit cash and or securities in a third party custodial account to serve as collateral. At the time the Fund enters into a repurchase agreement, the value of the underlying collateral, including accrued interest, will be equal to or exceed the value of the repurchase agreement. Repurchase agreements expose the Fund to counterparty risk – that is, the risk that the counterparty will not fulfill its obligations. To minimize counterparty risk, the investments that serve to collateralize the repurchase agreement are held by the Fund’s custodian in book entry or physical form in the custodial account of the Fund or in a third party custodial account. Repurchase agreements are valued at cost plus accrued interest, which approximates fair value. Repurchase agreements have master netting arrangements which allow the Fund to offset amounts owed to a counterparty with amounts owed by the counterparty, including any collateral. Upon an event of default under a master repurchase agreement, the non-defaulting party may close out all transactions traded under such agreement and net amounts owed under each transaction to one net amount payable by one party to the other. Absent an event of default, the master repurchase agreement does not result in an offset of reported amounts of assets and liabilities in the Statement of Assets and Liabilities across transactions between the Fund and the applicable counterparty. The Fund, as shown on the Schedule of Investments, had outstanding repurchase agreements and related collateral as of December 31, 2017. |
| b) | Investments Purchased on a When-Issued or Delayed-Delivery Basis – Delivery and payment for investments that have been purchased by the Fund on a forward commitment, or when-issued or delayed-delivery basis, take place beyond the customary settlement period. The Fund may dispose of or renegotiate a delayed-delivery transaction after it is entered into, and may sell delayed-delivery investments before they are delivered, which may result in a realized gain or loss. During this period, such investments are subject to market fluctuations, and the Fund identifies investments segregated in its records with a value at least equal to the amount of the commitment. When-issued and delayed delivery investments and forward commitments involve the risk that the investment the Fund buys will lose value prior to its delivery. There are also risks that the investment will never be issued or that the other party to the transaction will not meet its obligation. If this occurs, the Fund loses both the investment opportunity for the assets it set aside to pay for the investment and any gain in the investment’s price. The Fund did not hold when-issued or delayed-delivery investments as of December 31, 2017. |
Notes to Financial Statements – (continued)
December 31, 2017
4. | Financial Derivative Instruments: |
The following disclosures contain information on how and why the Fund uses derivative instruments, the credit-risk-related contingent features in certain derivative instruments, and how derivative instruments affect the Fund’s financial position and results of operations. The location and fair value amounts of these instruments in the Statement of Assets and Liabilities and the realized gains and losses and changes in unrealized gains and losses in the Statement of Operations, each categorized by type of derivative contract, are included in the following Additional Derivative Instrument Information footnote. The derivative instruments outstanding as of year-end are disclosed in the notes to the Schedule of Investments, if applicable. The amounts of realized gains and losses and changes in unrealized appreciation and depreciation on derivative instruments during the year are disclosed in the Statement of Operations.
| a) | Futures Contracts – The Fund may enter into futures contracts. A futures contract is an agreement between two parties to buy or sell an asset at a set price on a future date. The Fund uses futures contracts to manage or obtain exposure to the investment markets, commodities, or movements in interest rates and currency values. The primary risks associated with the use of futures contracts are the imperfect correlation between the change in market value of the investments held by the Fund and the prices of futures contracts and the possibility of an illiquid market. Upon entering into a futures contract, the Fund is required to deposit with a futures commission merchant (“FCM”) an amount of cash or U.S. Government or Agency Obligations in accordance with the initial margin requirements of the broker or exchange. Futures contracts are marked to market daily at the most recent settlement price reported by an exchange on which, over time, they are traded most extensively, and an appropriate payable or receivable for the change in value (“variation margin”) is recorded by the Fund. Gains or losses are recognized but not considered realized until the contracts expire or are closed. Futures contracts involve, to varying degrees, risk of loss in excess of the variation margin disclosed in the Statement of Assets and Liabilities; however, the Fund seeks to reduce this risk through the use of an FCM. The Fund, as shown on the Schedule of Investments, had outstanding futures contracts as of December 31, 2017. |
Additional Derivative Instrument Information:
Fair Value of Derivative Instruments in the Statement of Assets and Liabilities as of December 31, 2017:
| | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | Risk Exposure Category | |
| | Interest Rate Contracts | | | Foreign Exchange Contracts | | | Credit Contracts | | | Equity Contracts | | | Commodity Contracts | | | Other Contracts | | | Total | |
Assets: | |
Unrealized appreciation on futures(1) | | $ | — | | | $ | — | | | $ | — | | | $ | 42,495 | | | $ | — | | | $ | — | | | $ | 42,495 | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Total | | $ | — | | | $ | — | | | $ | — | | | $ | 42,495 | | | $ | — | | | $ | — | | | $ | 42,495 | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| (1) | Includes cumulative appreciation/depreciation on financial futures contracts as reported in the Schedule of Investments. Only current day’s variation margin is reported within the Statement of Assets and Liabilities. |
The volume of derivatives that is presented in the Schedule of Investments is consistent with the derivative activity during the year ended December 31, 2017.
The Effect of Derivative Instruments in the Statement of Operations for the year ended December 31, 2017:
| | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | Risk Exposure Category | |
| | Interest Rate Contracts | | | Foreign Exchange Contracts | | | Credit Contracts | | | Equity Contracts | | | Commodity Contracts | | | Other Contracts | | | Total | |
Realized Gain on Derivatives Recognized as a Result of Operations: | |
Net realized gain on futures | | $ | — | | | $ | — | | | $ | — | | | $ | 1,856,081 | | | $ | — | | | $ | — | | | $ | 1,856,081 | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Total | | $ | — | | | $ | — | | | $ | — | | | $ | 1,856,081 | | | $ | — | | | $ | — | | | $ | 1,856,081 | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | |
|
Net Change in Unrealized Appreciation (Depreciation) on Derivatives Recognized as a Result of Operations: | |
Net change in unrealized appreciation of futures | | $ | — | | | $ | — | | | $ | — | | | $ | 59,959 | | | $ | — | | | $ | — | | | $ | 59,959 | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Total | | $ | — | | | $ | — | | | $ | — | | | $ | 59,959 | | | $ | — | | | $ | — | | | $ | 59,959 | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Notes to Financial Statements – (continued)
December 31, 2017
| b) | Balance Sheet Offsetting Information – Set forth below are tables which disclose both gross information and net information about instruments and transactions eligible for offset in the financial statements, and instruments and transactions that are subject to a master netting arrangement, as well as amounts related to margin, reflected as financial collateral (including cash collateral), held at clearing brokers, counterparties and the Fund’s custodian. The master netting arrangements allow the clearing brokers to net any collateral held in or on behalf of the Fund, or liabilities or payment obligations of the clearing brokers to the Fund, against any liabilities or payment obligations of the Fund to the clearing brokers. The Fund is required to deposit financial collateral (including cash collateral) at the Fund’s custodian on behalf of clearing brokers and counterparties to continually meet the original and maintenance requirements established by the clearing brokers and counterparties. Such requirements are specific to the respective clearing broker or counterparty. Certain master netting arrangements may not be enforceable in a bankruptcy. |
The following tables present the Fund’s derivative assets and liabilities, presented on a gross basis as no amounts are netted within the Statement of Assets and Liabilities, by counterparty net of amounts available for offset under a master netting agreement or similar agreement (“MNA”) and net of the related collateral received/pledged by the Fund as of December 31, 2017:
| | | | | | | | |
Derivative Financial Instruments: | | Assets | | | Liabilities | |
Futures contracts | | $ | 42,495 | | | $ | — | |
| | | | | | | | |
Total gross amount of derivative assets and liabilities in the Statement of Assets and Liabilities | | | 42,495 | | | | — | |
| | | | | | | | |
Derivatives not subject to a MNA | | | (42,495 | ) | | | — | |
| | | | | | | | |
Total gross amount of assets and liabilities subject to MNA or similar agreements | | $ | — | | | $ | — | |
| | | | | | | | |
The market values of equity securities, such as common stocks and preferred stocks, or equity related investments, such as futures and options, may decline due to general market conditions which are not specifically related to a particular company, such as real or perceived adverse economic conditions, changes in the general outlook for corporate earnings, changes in interest or currency rates or adverse investor sentiment generally. The market value of equity securities may also decline due to factors which affect a particular industry or industries, such as labor shortages or increased production costs and competitive conditions within an industry. Equity securities and equity related investments generally have greater market price volatility than fixed income securities.
The Fund may be exposed to counterparty risk, or the risk that an institution or other entity with which the Fund has unsettled or open transactions will default.
| a) | Federal Income Taxes – For federal income tax purposes, the Fund intends to continue to qualify as a RIC under Subchapter M of the Internal Revenue Code of 1986, as amended (“IRC”), by distributing substantially all of its taxable net investment income and net realized capital gains to its shareholders and otherwise complying with the requirements of the IRC. The Fund distributed substantially all of its income and capital gains in prior years, if applicable, and intends to distribute substantially all of its income and capital gains prior to the next fiscal year-end. Accordingly, no provision for federal income or excise taxes has been made in the accompanying financial statements. Distributions from short-term capital gains are treated as ordinary income distributions for federal income tax purposes. |
| b) | Net Investment Income (Loss), Net Realized Gains (Losses) and Distributions – Net investment income (loss) and net realized gains (losses) may differ for financial statement and tax purposes primarily because of losses deferred due to wash sale adjustments, adjustments related to REITs, certain derivatives and corporate actions. The 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. Also, due to the timing of dividend distributions, the fiscal year in which amounts are distributed may differ from the year that the income or realized gains (losses) were recorded by the Fund. |
Notes to Financial Statements – (continued)
December 31, 2017
| c) | Distributions and Components of Distributable Earnings – The tax character of distributions paid by the Fund for the periods indicated is as follows (as adjusted for dividends payable, if applicable): |
| | | | | | | | |
| | For the Year Ended December 31, 2017 | | | For the Year Ended December 31, 2016 | |
Ordinary Income | | $ | 20,235,166 | | | $ | 22,579,859 | |
Long-Term Capital Gains(1) | | | 62,638,384 | | | | 73,467,615 | |
| (1) | The Fund designates these distributions as capital gain dividends per IRC Sec. 852(b) (3) (C). |
As of December 31, 2017, the Fund’s components of distributable earnings (deficit) on a tax basis were as follows:
| | | | |
| | Amount | |
Undistributed Ordinary Income | | $ | 18,550,911 | |
Undistributed Long-Term Capital Gain | | | 64,829,888 | |
Unrealized Appreciation (Depreciation) | | | 582,042,391 | |
| | | | |
Total Accumulated Earnings (Deficit) | | $ | 665,423,190 | |
| | | | |
| d) | Reclassification of Capital Accounts – The Fund may record reclassifications in its capital accounts. These reclassifications have no impact on the total net assets of the Fund. The reclassifications are a result of permanent differences between U.S. GAAP and tax accounting for such items as REITs and corporate actions. Adjustments are made to reflect the impact these items have on current and future distributions to shareholders. Therefore, the source of the Fund’s distributions may be shown in the accompanying Statements of Changes in Net Assets as from undistributed net investment income, from accumulated net realized gains on investments or from capital depending on the type of book and tax differences that exist. For the fiscal year ended December 31, 2017, the Fund recorded reclassifications to increase (decrease) the accounts listed below: |
| | | | |
| | Amount | |
Paid In Capital | | $ | (822,738 | ) |
Undistributed Net Investment Income | | | 770,790 | |
Accumulated Net Realized Gain | | | 51,948 | |
| e) | Capital Loss Carryforward – Under U.S. tax law, the Fund is permitted to carry forward capital losses for an unlimited period. Additionally, capital loss carryforwards retain their character as either short-term or long-term capital losses rather than being considered all short-term as permitted under prior regulation. |
The Fund had no capital loss carryforwards for U.S. federal income tax purposes as of December 31, 2017.
| f) | Federal Tax Cost – At December 31, 2017, the cost of securities (including derivatives) for federal income tax purposes was $569,419,650, and the aggregate gross unrealized appreciation and depreciation based on that cost were: |
| | | | |
| | Amount | |
Unrealized Appreciation | | $ | 598,942,573 | |
Unrealized Depreciation | | | (16,900,182 | ) |
| | | | |
Net Unrealized Appreciation | | $ | 582,042,391 | |
| | | | |
| g) | Accounting for Uncertainty in Income Taxes – In accordance with U.S. GAAP, the Fund analyzes all open tax years, as defined by the statute of limitations, for all major jurisdictions. Generally, tax authorities can examine all tax returns filed for the last three years. The Fund does not have an examination in progress. |
The Fund has reviewed all open tax years and major jurisdictions and concluded that these financial reporting rules had no effect on the Fund’s financial position or results of operations. There is no tax liability resulting from unrecognized tax benefits relating to uncertain income tax positions taken or expected to be taken on the tax return for the fiscal year ended December 31, 2017. The Fund is also not aware of any tax positions for which it is reasonably possible that the total amounts of unrecognized tax benefits will significantly change in the next twelve months.
Notes to Financial Statements – (continued)
December 31, 2017
| a) | Investment Management Agreement – Hartford Investment Management Company (“Hartford Investment Management”) serves as the Fund’s investment manager pursuant to an Investment Management Agreement with the Trust. Hartford Investment Management is a wholly owned subsidiary of The Hartford Financial Services Group, Inc. (“The Hartford”). The investment manager provides day-to-day investment management services to the Fund and has overall investment supervisory responsibility for the Fund. In addition, the investment manager provides administrative personnel, services, equipment, facilities and office space for operation of the Fund. |
The schedule below reflects the rates of compensation as a percentage of the Fund’s average daily net assets paid to the investment manager for investment management services rendered as of December 31, 2017; the rates are accrued daily and paid monthly.
| | | | |
Average Daily Net Assets | | Annual Fee | |
On first $2 billion | | | 0.30 | % |
On next $3 billion | | | 0.20 | % |
On next $5 billion | | | 0.18 | % |
Over $10 billion | | | 0.17 | % |
| b) | Accounting Services Agreement – State Street Bank and Trust Company (“State Street Bank”) provides the Fund with accounting services pursuant to a fund accounting agreement by and between the Trust, on behalf of the Fund, and State Street Bank. The amount paid for accounting services can be found in the Statement of Operations. These fees are accrued daily and paid monthly. |
| c) | Operating Expenses – Allocable expenses incurred by the Trust are allocated to the Fund and allocated to classes within the Fund in proportion to the average daily net assets of the Fund and each class, except where allocation of certain expenses is more fairly made directly to the Fund or to specific classes within the Fund. |
Hartford Investment Management has contractually agreed to reimburse expenses (exclusive of taxes, interest expense, brokerage commissions, acquired fund fees and expenses and extraordinary expenses) to the extent necessary to maintain total annual operating expenses of the Fund as follows; 0.33% for Class IA and 0.58% for Class IB. This contractual arrangement will remain in effect until April 30, 2018, and shall renew automatically for one-year terms unless the investment manager provides written notice of termination prior to the start of the next term or upon approval of the Board of Trustees of the Fund.
| d) | Distribution Plan for Class IB Shares – HIMCO Distribution Services Company, a wholly owned subsidiary of The Hartford, serves as the principal underwriter and distributor of the Fund. The Trust, on behalf of the Fund, has adopted a Distribution Plan pursuant to Rule 12b-1 of the 1940 Act for Class IB shares to compensate the distributor, from assets attributable to the services rendered and expenses borne in connection with activities primarily intended to result in the sale of the Class IB shares, subject to the review and approval of the Board of Trustees. |
The Distribution Plan provides that the Fund may pay annually up to 0.25% of the average daily net assets of the Fund attributable to its Class IB shares for activities primarily intended to result in the sale of Class IB shares. The Board of Trustees has the authority to suspend or reduce these payments at any point in time. Under the terms of the Distribution Plan and the principal underwriting agreement, the Fund is authorized to make payments monthly to the distributor that may be used to pay or reimburse entities, including insurance company affiliates of Hartford Investment Management, providing distribution and shareholder servicing with respect to the Class IB shares for such entities’ fees or expenses incurred or paid in that regard. The distribution fee paid during the period can be found in the Statement of Operations. These fees are accrued daily and paid monthly or at such other intervals as the Board of Trustees may determine.
| e) | Transfer Agent Fees – State Street Bank provides transfer agent services to the Fund. The transfer agent is reimbursed for out-of-pocket expenses and other costs associated with the services it provides to the Fund, including costs invoiced by sub-contractors. Hartford Investment Management and its affiliates may pay, out of their own assets, compensation to third-party administrators for recordkeeping and other administrative services. The amount paid for transfer agent services can be found in the Statement of Operations. These fees are accrued daily and paid monthly. |
Notes to Financial Statements – (concluded)
December 31, 2017
| f) | Trustee Fees – The Board of Trustees is responsible for oversight of the Fund. The Board of Trustees elects officers who are responsible for the day to day operations of the Fund. The Board of Trustees oversees the investment manager and the other principal service providers of the Fund. The Board of Trustees currently holds four regularly scheduled meetings throughout each year. In addition, the Board of Trustees may hold special meetings at other times either in person or by telephone. The Trustee fees paid during the period can be found in the Statement of Operations. |
8. | Investment Transactions: |
For the year ended December 31, 2017, the aggregate cost of purchases and proceeds from sales of investment securities (excluding short-term investments) was as follows:
| | | | |
| | Amount | |
Cost of Purchases Excluding U.S. Government Obligations | | $ | 37,769,798 | |
Sales Proceeds Excluding U.S. Government Obligations | | | 137,578,925 | |
9. | Pending Legal Proceedings: |
On June 2, 2011, a complaint was filed against Hartford Investment Management Company in the United States District Court of Connecticut (Deutsche Bank Trust Company Americas v. Aetna, Inc., ING Investment Trust Co., Milan E. Chilla, Hartford Investment Management Co., and UBS AG (D. Conn.)). In a similar action, plaintiffs filed a complaint listing The Hartford Index HLS Fund, which was merged into HIMCO VIT Index Fund in October, 2014, as members of the defendant class (The Official Committee of Unsecured Creditors of Tribune Company v. Fitzsimons, et al. (Bankr. D. Del.)). The complaints relate to the bankruptcy of the Tribune Company, which was a public company that repurchased its shares in a leveraged buyout in 2007, but entered bankruptcy a year later. The plaintiffs in each case allege that the repurchase of shares acted as a fraudulent transfer. The plaintiffs in each case seek to recover from each class member the amount of consideration received in the buyout. The Hartford Index HLS Fund held 23,987 shares and received $815,558 in the buyout. The Hartford Index HLS Fund is listed as a member of the defendant shareholder class in an exhibit to the Complaint. Each action was transferred to the United States District Court for the Southern District of New York. In September 2013, the court dismissed the Deutsche Bank Trust Company Americas action, and this dismissal was affirmed in March 2016 by the United States Court of Appeals for the Second Circuit. In The Official Committee of Unsecured Creditors of Tribune Company action, the court in January 2017 granted the motion to dismiss filed in 2014 by the shareholder defendants. As a result, the shareholder defendants, including The Hartford Index HLS Fund, have all now been dismissed from the case. Because other non-shareholder defendants remain in the lawsuit, the dismissal order is not immediately appealable by the plaintiff, but an eventual appeal is expected. The Hartford, on behalf of the Fund, intends to continue to vigorously defend these actions.
Under the Trust’s organizational documents, the Trust shall indemnify its officers and trustees to the full extent required or permitted under The Delaware Statutory Trust Act and the federal securities laws. In addition, the Trust, on behalf of the Fund, may enter into contracts that contain a variety of indemnifications. The Trust’s maximum exposure under these arrangements is unknown. However, as of the date of these financial statements the Trust has not had prior claims or losses pursuant to these contracts and expects the risk of loss to be remote.
Management has evaluated the need for disclosures and/or adjustments resulting from subsequent events through the date the Financial Statements were issued. Except as noted below, based on this evaluation, no adjustments to, or disclosures in, the Financial Statements were necessary as of December 31, 2017.
At a meeting held on December 1, 2017, the Board of Trustees unanimously approved an Agreement and Plan of Reorganization for the reorganization of the Fund with and into BlackRock S&P 500 Index V.I. Fund, a series of BlackRock Variable Series Funds, Inc. (the “Reorganization”). The Board of Trustees has called for a special meeting of shareholders of the Fund to be held on April 4, 2018 for the purpose of seeking approval of the Agreement and Plan of Reorganization. If approved, the Reorganization is expected to occur on or about April 23, 2018, resulting in the termination, dissolution and complete liquidation of the Fund as a series of the Trust.
Financial Highlights
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | — Selected Per-Share Data(1) — | | | — Ratios and Supplemental Data — | |
Class | | Net Asset Value at, Beginning of Period | | | Net Investment Income (Loss) | | | Net Realized and Unrealized Gain (Loss) on Investments | | | Total from Investment Operations | | | Distributions from Net Investment Income | | | Distributions from Realized Gain on Investments | | | Total Distributions | | | Net Asset Value End of Period | | | Total Return(2) | | | Net Assets at End of Period (000s) | | | Ratio of Expenses to Average Net Assets Before Adjust- ments(3) | | | Ratio of Expenses to Average Net Assets After Adjust- ments(3) | | | Ratio of Net Investment Income (Loss) to Average Net Assets | |
HIMCO VIT Index Fund | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
For the Year Ended December 31, 2017 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
IA | | $ | 41.58 | | | $ | 0.76 | | | $ | 7.79 | | | $ | 8.55 | | | $ | (0.82 | ) | | $ | (2.61 | ) | | $ | (3.43 | ) | | $ | 46.70 | | | | 21.44 | % | | $ | 755,848 | | | | 0.38 | % | | | 0.33 | % | | | 1.72 | % |
IB | | | 41.09 | | | | 0.64 | | | | 7.68 | | | | 8.32 | | | | (0.82 | ) | | | (2.61 | ) | | | (3.43 | ) | | | 45.98 | | | | 21.13 | | | | 395,729 | | | | 0.63 | | | | 0.58 | | | | 1.47 | |
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For the Year Ended December 31, 2016 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
IA | | $ | 40.92 | | | $ | 0.79 | | | $ | 3.82 | | | $ | 4.61 | | | $ | (0.91 | ) | | $ | (3.04 | ) | | $ | (3.95 | ) | | $ | 41.58 | | | | 11.59 | % | | $ | 677,208 | | | | 0.38 | % | | | 0.33 | % | | | 1.93 | % |
IB | | | 40.57 | | | | 0.68 | | | | 3.79 | | | | 4.47 | | | | (0.91 | ) | | | (3.04 | ) | | | (3.95 | ) | | | 41.09 | | | | 11.34 | | | | 381,418 | | | | 0.63 | | | | 0.58 | | | | 1.68 | |
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For the Year Ended December 31, 2015 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
IA | | $ | 41.11 | | | $ | 0.79 | | | $ | (0.34 | ) | | $ | 0.45 | | | $ | (0.15 | ) | | $ | (0.49 | ) | | $ | (0.64 | ) | | $ | 40.92 | | | | 1.06 | % | | $ | 680,974 | | | | 0.42 | % | | | 0.33 | % | | | 1.92 | % |
IB | | | 40.86 | | | | 0.69 | | | | (0.34 | ) | | | 0.35 | | | | (0.15 | ) | | | (0.49 | ) | | | (0.64 | ) | | | 40.57 | | | | 0.82 | | | | 414,950 | | | | 0.67 | | | | 0.58 | | | | 1.67 | |
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For the Year Ended December 31, 2014 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
IA | | $ | 38.54 | | | $ | 0.69 | | | $ | 4.23 | | | $ | 4.92 | | | $ | (0.58 | ) | | $ | (1.77 | ) | | $ | (2.35 | ) | | $ | 41.11 | | | | 13.33 | % | | $ | 760,768 | | | | 0.33 | % | | | 0.33 | % | | | 1.74 | % |
IB | | | 38.35 | | | | 0.59 | | | | 4.19 | | | | 4.78 | | | | (0.50 | ) | | | (1.77 | ) | | | (2.27 | ) | | | 40.86 | | | | 13.01 | | | | 467,467 | | | | 0.58 | | | | 0.58 | | | | 1.49 | |
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For the Year Ended December 31, 2013(4) | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
IA | | $ | 29.69 | | | $ | 0.62 | | | $ | 8.85 | | | $ | 9.47 | | | $ | (0.62 | ) | | $ | — | | | $ | (0.62 | ) | | $ | 38.54 | | | | 31.95 | % | | $ | 763,868 | | | | 0.33 | % | | | 0.33 | % | | | 1.79 | % |
IB | | | 29.56 | | | | 0.53 | | | | 8.80 | | | | 9.33 | | | | (0.54 | ) | | | — | | | | (0.54 | ) | | | 38.35 | | | | 31.61 | | | | 413,119 | | | | 0.58 | | | | 0.58 | | | | 1.54 | |
(1) | Information presented relates to a share outstanding throughout the indicated period. Net investment income (loss) per share amounts are calculated based on average shares outstanding unless otherwise noted. |
(2) | The figures do not include sales charges or other fees which may be applied at the variable life insurance, variable annuity or qualified retirement plan product level. Any such additional sales charges or other fees would lower the Fund’s performance. |
(3) | Adjustments include waivers and reimbursements, if applicable. |
(4) | Financial highlights for the fiscal year ended December 31, 2013 were audited by the Predecessor Fund’s auditor. |
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| | Portfolio Turnover Rate for All Share Classes | |
For the Year Ended December 31, 2017 | | | 3 | % |
For the Year Ended December 31, 2016 | | | 12 | |
For the Year Ended December 31, 2015 | | | 8 | |
For the Year Ended December 31, 2014 | | | 3 | |
For the Year Ended December 31, 2013(1) | | | 3 | |
(1) | Financial highlights for the fiscal year ended December 31, 2013 were audited by the Predecessor Fund’s auditor. |
|
Report of Independent Registered Public Accounting Firm |
To the Board of Trustees of HIMCO Variable Insurance Trust and Shareholders of
HIMCO VIT Index Fund:
Opinion on the Financial Statements and Financial Highlights
We have audited the accompanying statement of assets and liabilities of HIMCO VIT Index Fund (the “Fund”), a series of the HIMCO Variable Insurance Trust, including the schedule of investments, as of December 31, 2017, the related statement of operations for the year then ended, the statements of changes in net assets for each of the two years in the period then ended, the financial highlights for each of the four years in the period then ended, and the related notes. The financial highlights for the year ended December 31, 2013 were audited by other auditors. Those auditors expressed an unqualified opinion on the financial highlights in their report dated February 17, 2014. In our opinion, the financial statements and financial highlights present fairly, in all material respects, the financial position of the Fund as of December 31, 2017, and the results of its operations for the year then ended, the changes in its 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, in conformity with accounting principles generally accepted in the United States of America.
Basis for Opinion
These financial statements and financial highlights are the responsibility of the Fund’s management. Our responsibility is to express an opinion on the Fund’s financial statements and financial highlights based on our audits. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (PCAOB) and are required to be independent with respect to the Fund in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.
We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements and financial highlights are free of material misstatement, whether due to error or fraud. The Fund is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. As part of our audits we are required to obtain an understanding of internal control over financial reporting but not for the purpose of expressing an opinion on the effectiveness of the Fund’s internal control over financial reporting. Accordingly, we express no such opinion.
Our audits included performing procedures to assess the risks of material misstatement of the financial statements and financial highlights, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements and financial highlights. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial statements and financial highlights. Our procedures included confirmation of securities owned as of December 31, 2017, by correspondence with the custodian and brokers; when replies were not received from brokers, we performed other auditing procedures. We believe that our audits provide a reasonable basis for our opinion.
As discussed in Note 11 to the financial statements, on December 1, 2017, the Board of Trustees unanimously approved an Agreement and Plan of Reorganization for the reorganization of the Fund with and into BlackRock S&P 500 Index V.I. Fund, a series of BlackRock Variable Series Funds, Inc.
Deloitte & Touche LLP
Boston, Massachusetts
February 12, 2018
We have served as the auditor of one or more HIMCO Variable Insurance Trust investment companies since 2014.
Trustees and Officers (Unaudited)
The Board of Trustees and officers of the Trust, their business addresses, principal occupations for at least the past five years and years of birth are listed in the tables below. The Board of Trustees (i) provides broad supervision over the affairs of the Trust and the Fund and (ii) elects officers who are responsible for the day-to-day operations of the Fund and the execution of policies formulated by the Board of Trustees. The first table below provides information about those trustees who are deemed not to be “interested persons” of the Trust, as that term is defined in the 1940 Act (i.e., “non-interested trustees”), while the second table below provides information about the Trust’s “interested” trustees and the Trust’s officers.
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Birth and Address | | Position Held with the Trust | | Term of Office* and Length of Time Served | | Principal Occupation(s) During Past 5 Years | | Number of Portfolios in Fund Complex Overseen by Trustee | | Other Directorships for Public Companies and Other Registered Investment Companies Held by Trustee |
PAUL BRAVERMAN (1949) c/o Hartford Investment Management Company One Hartford Plaza Hartford, CT 06155 | | Lead Independent Trustee | | Since 2014 | | Mr. Braverman is a private investor. He was a Partner and Chief Financial Officer of Wellington Management Company, LLP until 2007. He currently serves as a board member at Aesir Capital Management, Claren Road Asset Management, and Kieger (US) Ltd., investment advisory firms, and Leerink Swann Holdings, a healthcare investment bank. | | 2 | | Mr. Braverman currently serves as an Independent Trustee of GMO Trust (January 2009 to present) (54 funds overseen). |
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MARK OSTERHELD (1955) c/o Hartford Investment Management Company One Hartford Plaza Hartford, CT 06155 | | Trustee | | Since 2014 | | Mr. Osterheld is a private investor. Mr. Osterheld was Vice President of Treasury Oversight at Fidelity Investments until 2013. | | 2 | | None. |
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VANESSA WILSON (1959) c/o Hartford Investment Management Company One Hartford Plaza Hartford, CT 06155 | | Trustee | | Since 2014 | | Ms. Wilson is a private investor. Ms. Wilson served as Chief Financial Officer of Golden Seeds LLC, and of Golden Seeds Fund 2 GP until September 2015. Ms. Wilson worked for Deutsche Bank Securities until 2007, where she was a Managing Director and an equity research analyst. | | 2 | | None. |
* | Term of Office: Each trustee may serve until his or her successor is elected and qualifies. |
Trustees and Officers (Unaudited) (continued)
Officers and Interested Trustees
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Name, Year of Birth and Address | | Position Held with the Trust | | Term of Office* and Length of Time Served | | Principal Occupation(s) During Past 5 Years | | Number of Portfolios in Fund Complex Overseen by Trustee | | Other Directorships Held by Trustee |
BRION JOHNSON** (1960) c/o Hartford Investment Management Company One Hartford Plaza Hartford, CT 06155 | | Trustee and Chairman of the Board | | Since 2014 | | Mr. Johnson currently serves as President of Hartford Investment Management and President of Hartford Life. From 2011 to 2012, Mr. Johnson served as a Managing Director, Chief Financial Officer and Head of Strategy and Development for Hartford Investment Management. Prior to joining Hartford Investment Management, Mr. Johnson served as Managing Member of Shoreline Arts and Publishing, LLC, a publishing and marketing business. From 2001 to 2008, Mr. Johnson was Executive Vice President and Head of Portfolio Management of PPM America, an affiliate of Prudential, plc. | | 2 | | None. |
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HUGH WHELAN** (1960) c/o Hartford Investment Management Company One Hartford Plaza Hartford, CT 06155 | | Trustee | | Since 2014 | | Mr. Whelan is a private investor. Mr. Whelan was the Head of Quantitative Equities and Interim President of Hartford Investment Management until 2012. Prior to joining Hartford Investment Management, Mr. Whelan was the Head of Quantitative Equities at ING Investment Management from 2001 to 2005. | | 2 | | None. |
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JEREMY BILLIEL† (1979) c/o Hartford Investment Management Company One Hartford Plaza Hartford, CT 06155 | | Treasurer | | Since 2018 | | Mr. Billiel currently serves as Vice President of Hartford Investment Management, overseeing all FP&A activities for the firm. From 2014 to 2017, he served as Assistant Treasurer of HIMCO Variable Insurance Trust. Prior to 2013, Mr. Billiel held various roles within The Hartford’s Personal Lines division and ING Investment management. | | N/A | | N/A |
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CHRISTOPHER CONNER (1970) c/o Hartford Investment Management Company One Hartford Plaza Hartford, CT 06155 | | Chief Compliance Officer | | Since 2016 | | Mr. Conner currently serves as Chief Compliance Officer of Hartford Life separate accounts and various Hartford entity broker-dealers. Prior to 2009, he served as Chief Compliance Officer and Counsel for Hartford Life Distributors, LLC. | | N/A | | N/A |
† | Mr. Billiel was appointed Treasurer of the Trust effective January 15, 2018. |
* | Term of Office: Each officer and Trustee may serve until his or her successor is elected and qualifies. |
** | “Interested person,” as defined in the 1940 Act, of the Company because of the person’s affiliation with, or equity ownership of, Hartford Investment Management or affiliated companies. |
Trustees and Officers (Unaudited) (concluded)
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Name, Year of Birth and Address | | Position Held with the Trust | | Term of Office* and Length of Time Served | | Principal Occupation(s) During Past 5 Years | | Number of Portfolios in Fund Complex Overseen by Trustee | | Other Directorships Held by Trustee |
ERIC FAY (1962) c/o Hartford Investment Management Company One Hartford Plaza Hartford, CT 06155 | | Chief Operating Officer | | Since 2015 | | Mr. Fay currently serves as an Executive Vice President and Head of Business Operations of Hartford Investment Management. Prior to joining Hartford Investment Management, Mr. Fay served as Senior Vice President of Operations and Administration at The Hartford Bank. Before that Mr. Fay was a Senior Vice President and Chief Trust Officer for Guardian Life Insurance Company. | | N/A | | N/A |
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BRENDA PAGE (1965) c/o Hartford Investment Management Company One Hartford Plaza Hartford, CT 06155 | | Secretary and Chief Legal Officer | | Since 2014 | | Ms. Page currently serves as Vice President and Assistant General Counsel of The Hartford and Director of the Investment Law Group and Chief Compliance Officer of Hartford Investment Management. | | N/A | | N/A |
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MATTHEW POZNAR (1959) c/o Hartford Investment Management Company One Hartford Plaza Hartford, CT 06155 | | President | | Since 2014 | | Mr. Poznar currently serves as an Executive Vice President in the General Account Portfolio Management Group of Hartford Investment Management. | | N/A | | N/A |
* Term of Office: Each officer and Trustee may serve until his or her successor is elected and qualifies.
HOW TO OBTAIN A COPY OF THE FUND’S PROXY VOTING POLICIES AND VOTING RECORDS (UNAUDITED)
A description of the policies and procedures that the Fund uses to determine how to vote proxies relating to portfolio securities and information about how the Fund voted proxies relating to portfolio securities during the most recent twelve-month period ended June 30 are available (1) without charge, upon request, by calling 1-800-862-6668 and (2) on the SEC’s website at http://www.sec.gov. Additionally, a complete list of holdings is available on the Fund’s website at www.HVITFunds.com.
QUARTERLY PORTFOLIO HOLDINGS INFORMATION (UNAUDITED)
The Fund files a complete schedule of portfolio holdings with the SEC for the first and third quarters of each fiscal year on Form N-Q. The Fund’s Forms N-Q are available (1) without charge, upon request, by calling 1-800-862-6668 and (2) on the SEC’s website at http://www.sec.gov. The Form N-Q 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.
Expense Example (Unaudited)
Your Fund’s Expenses
As a shareholder of the Fund, you incur two types of costs: (1) transaction costs and (2) ongoing costs, including investment management fees, distribution and/or service (12b-1) fees, if any, and other fund expenses. This example is intended to help you understand your ongoing costs (in dollars) of investing in the Fund and to compare these costs with the ongoing costs of investing in other mutual funds. The example is based on an investment of $1,000 invested at the beginning of the period and held for the entire period of July 1, 2017 through December 31, 2017.
Actual Expenses
The first set of rows of the table below provides information about actual account values and actual expenses. You may use the information in this row, together with the amount you invested, to estimate the expenses that you paid over the period. Simply divide your account value by $1,000 (for example, an $8,600 account value divided by $1,000 = 8.6), then multiply the result by the number in the line under the heading entitled “Expenses Paid During Period” to estimate the expenses you paid on your account during this period.
Hypothetical Example for Comparison Purposes
The second set of rows of the table below provides information about hypothetical account values and hypothetical expenses based on the Fund’s actual expense ratio and an assumed rate of return of 5% per year before expenses, which is not the Fund’s actual return. The hypothetical account values and expenses may not be used to estimate the actual ending account balance or expenses you paid for the period. You may use this information to compare the ongoing costs of investing in the 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 fees which may be applied at the variable life insurance, variable annuity, or qualified retirement plan product level. Therefore, the second set of rows of 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 be higher.
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| | Beginning Account Value 7/1/17 | | | Ending Account Value 12/31/17 | | | Expenses Paid During Period 7/1/17 - 12/31/17(1) | | | Net Annualized Expense Ratio(2) | |
Actual | |
Class IA | | $ | 1,000 | | | $ | 1,112.20 | | | $ | 1.76 | | | | 0.33 | % |
Class IB | | $ | 1,000 | | | $ | 1,111.00 | | | $ | 3.09 | | | | 0.58 | % |
Hypothetical | |
Class IA | | $ | 1,000 | | | $ | 1,023.54 | | | $ | 1.68 | | | | 0.33 | % |
Class IB | | $ | 1,000 | | | $ | 1,022.28 | | | $ | 2.96 | | | | 0.58 | % |
(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 184, the number of days in the most recent fiscal half-year, divided by 365, to reflect the one-half year period. |
(2) | Net annualized expense ratio is reflective of any applicable contractual fee waivers and/or expense reimbursements or voluntary fee waivers. Details regarding fee waivers can be found in Fees and Expenses of the accompanying Notes to Financial Statements. |
Approval of Investment Management Agreement (Unaudited)
Section 15(c) of the Investment Company Act of 1940, as amended (the “1940 Act”), requires that each mutual fund’s board of trustees, including a majority of those trustees who are not parties to the agreement or “interested persons” of the mutual fund, as defined in the 1940 Act (the “Independent Trustees”), annually review and consider the continuation of the mutual fund’s investment advisory agreement. At an in-person meeting held on December 1, 2017 (the “Meeting”), the Board of Trustees (the “Board”) of HIMCO Variable Insurance Trust (the “Trust”), including each of the Independent Trustees, unanimously voted to approve the continuation of the investment management agreement between Hartford Investment Management Company (“HIMCO” or the “Investment Manager”) and the Trust (the “Agreement”), on behalf of HIMCO VIT Index Fund (the “Fund”).
In connection with the renewal process and in advance of the Meeting, HIMCO provided information, including written responses and other supporting materials, to the Board in response to a request for information made on behalf of the Independent Trustees to facilitate the Board’s evaluation of the terms of the Agreement. In addition, the Board considered such additional information as it deemed reasonably necessary to evaluate the Agreement, which included information furnished to the Board at its meetings throughout the year, as well as information specifically prepared in connection with the annual approval of the Agreement at the Meeting. Information provided to the Board at its meetings throughout the year included, among other things, reports on Fund performance, legal, compliance and risk management matters, shareholder services and the other services provided to the Fund by the Investment Manager and its affiliates. The Board also considered the in-person presentations by Fund officers and representatives of HIMCO concerning the Agreement.
Broadridge Financial Solutions (“Broadridge”), an independent provider of investment company data, was retained to provide the Board with reports on how the Fund’s contractual management fees, actual management fees, other non-management fees, overall expense ratios and investment performance compared to those of comparable mutual funds with similar investment objectives.
In determining whether to continue the Agreement for the Fund, the members of the Board reviewed and evaluated information and factors they believed to be relevant and appropriate in light of the exercise of their reasonable business judgment. While individual members of the Board may have weighed certain factors differently, the Board’s determination to continue the Agreement was based on a comprehensive consideration of all information provided to the Board throughout the year and specifically with respect to the continuation of the Agreement. The Independent Trustees were also furnished with advice from their independent legal counsel, including advice regarding the legal standards applicable to their evaluation of the terms of the Agreement. Throughout the evaluation process, the Board was also assisted by counsel for the Fund. The Independent Trustees met in executive session with their independent counsel, outside the presence of the interested Trustees, Fund officers and representatives of HIMCO, to discuss the Agreement and the services provided by the Investment Manager and its affiliates. A more detailed summary of the important, but not necessarily all, factors the Board considered with respect to its approval of the Agreement is provided below.
In considering whether to approve the continuation of the Agreement, the Board noted that it unanimously approved (i) an Agreement and Plan of Reorganization that would reorganize the Fund with and into BlackRock S&P 500 Index V.I. Fund, a series of BlackRock Variable Series Funds, Inc. (the “BlackRock Reorganization”); and (ii) a submission to shareholders regarding a proposal to approve the Agreement and Plan of Reorganization. The Board considered that if approved by shareholders of the Fund, the BlackRock Reorganization is expected to occur on or about April 23, 2018.
Nature, Extent and Quality of Services Provided by the Investment Manager
The Board requested and considered information concerning the nature, extent and quality of the services provided to the Fund by the Investment Manager. The Board considered, among other things, the terms of the Agreement and the range of services provided by the Investment Manager, including, among other things, managing the Fund’s assets, assuring compliance with the Fund’s investment objective and limitations and coordinating and overseeing the services of the Fund’s service providers. The Board further considered the Investment Manager’s qualifications, experience and personnel. In this regard, they considered personnel changes at HIMCO since the Board’s initial approval of the investment management agreement. Moreover, the Board considered HIMCO’s oversight of potential conflicts of interest between the Fund’s investments and those of other funds or accounts managed by the Fund’s portfolio management personnel.
The Board also requested and evaluated information concerning the Investment Manager’s regulatory and compliance environment. In this regard, the Board requested and reviewed information about the Investment Manager’s compliance policies and procedures, compliance history, and a report from the Fund’s Chief Compliance Officer about the Investment Manager’s
Approval of Investment Management Agreement (Unaudited) (continued)
compliance with applicable laws and regulations. The Board also noted the Investment Manager’s support of the Fund’s compliance control structure, particularly the resources devoted by the Investment Manager in support of the Fund’s obligations pursuant to Rule 38a-1 under the 1940 Act, as well as the efforts of HIMCO and its affiliates to combat cybersecurity risks and invest in business continuity planning.
Based on these considerations, the Board concluded that it was satisfied with the nature, extent and quality of the services provided to the Fund by HIMCO.
Performance of the Fund and the Investment Manager
The Board considered the investment performance of the Fund, noting that performance information for periods prior to October 20, 2014 related to that of a series of Hartford Series Fund, Inc. (the “Predecessor Fund”) which was reorganized into the Fund on that date (the “Reorganization”). The Board noted that, prior to the Reorganization, Hartford Funds Management Company, LLC served as the investment manager to the Predecessor Fund and HIMCO served as the sub-adviser to the Predecessor Fund. The Board reviewed the performance of the Fund over different time periods presented in the materials and evaluated HIMCO’s analysis of the Fund’s performance for these time periods. The Board considered information and materials provided to the Board by the Investment Manager concerning Fund performance, as well as information from Broadridge comparing the investment performance of the Fund to an appropriate benchmark and universe of peer funds. The Board noted that the Fund’s performance was in the 3rd quartile of its performance universe for the 1-, 3- and 5-year periods. The Board also considered that the Fund’s performance was in line with its benchmark for the 1-, 3- and 5-year periods, noting that the Fund is designed to track its benchmark closely.
The Board considered the detailed investment analytics reports provided by HIMCO throughout the year. These reports include, among other things, information on the Fund’s returns, the Fund’s investment performance relative to the benchmark and various statistics concerning the Fund’s portfolio.
In light of all the considerations noted above, the Board concluded that it had continued confidence in HIMCO’s overall capabilities to manage the Fund.
Costs of the Services and Profitability of the Investment Manager
The Board reviewed information regarding HIMCO’s cost to provide investment management and related services to the Fund and HIMCO’s profitability, both overall and for the Fund, on a pre-tax basis without regard to distribution expenses. The Board also requested and reviewed information about the profitability to HIMCO and its affiliates from all services provided to the Fund and all aspects of their relationship with the Fund. The Board noted that the analysis provided to the Board reflected HIMCO’s projected expenses and profitability for the first six months of the 2018 fiscal year. The Board considered that the management of the Fund was unprofitable for HIMCO for the 2017 fiscal year. The Board also reviewed the fees paid to participating insurance companies from HIMCO’s assets, including any profits.
Based on these considerations, the Board concluded that the profits anticipated to be realized by the Investment Manager and its affiliates from their relationships with the Fund would not be excessive.
Comparison of Fees and Services Provided by the Investment Manager
The Board considered the comparative information that had been provided with respect to the services rendered to and management fees paid by the Fund to HIMCO and the total expense ratios of the Fund. In this regard, the Board reviewed information from Broadridge comparing the Fund’s contractual management fees, actual management fees and overall expense ratios relative to a group of peer funds. The Board also reviewed the different types of fees charged to the Fund, noting that there had been no changes to the management fees or expense reimbursement arrangements since they were originally approved in April 2014. The Board considered that the management fee for the Fund includes the provision by HIMCO of certain administrative services to the Fund. The Board noted that the Fund’s contractual management fee, actual management fee, and total expenses were above the median of its expense group. The Board discussed the Fund’s fee levels, the Fund’s overall expense ratio and HIMCO’s profitability with respect to the Fund. The Board noted that the Fund’s Class IA and Class IB have contractual expense caps of 0.33% and 0.58%, respectively, which are scheduled to expire on April 30, 2018. The Board considered that HIMCO would voluntarily extend the expense caps through the closing date of the BlackRock Reorganization if completion of the BlackRock Reorganization were to occur after April 30, 2018.
Approval of Investment Management Agreement (Unaudited) (concluded)
While the Board recognized that comparisons between the Fund and peer funds may be imprecise, given the different service levels and characteristics of mutual funds and the different business models and cost structures of the Investment Manager, the comparative information provided by Broadridge assisted the Board in evaluating the reasonableness of the Fund’s management fees and total operating expenses.
Based on these considerations, the Board concluded that the Fund’s fees and total operating expenses, in conjunction with the information about quality of services, profitability, economies of scale and other matters discussed, were reasonable in light of the services provided.
Economies of Scale
The Board considered information regarding the extent to which economies of scale may be realized as the Fund grows and whether fee levels reflect these economies of scale for the benefit of the Fund’s shareholders. The Board noted that the management fee schedule for the Fund includes breakpoints that are designed to reduce the management fee rates as the Fund’s average daily net assets increase. The Board recognized that a fund with assets beyond the highest breakpoint level will continue to benefit from economies of scale because additional assets are charged the lowest breakpoint fee resulting in lower overall effective management fee rates. The Board also recognized that a fee schedule that reaches a lower breakpoint quickly provides shareholders with the benefit of anticipated or potential economies of scale. The Board also noted that expense limitations that reduce the Fund’s expenses at all asset levels can have the same effect as breakpoints in sharing economies of scale with shareholders and provide protection from an increase in expenses if the Fund’s assets decline. After considering all of the information available to it, the Board concluded that it was satisfied with the extent to which economies of scale would be shared for the benefit of the Fund’s shareholders based on currently available information and the effective advisory fees and expense ratios for the Fund at its current and reasonably anticipated asset levels.
Other Benefits
The Board considered other benefits to the Investment Manager and its affiliates from their relationships with the Fund, including the role of the Fund in supporting the variable life insurance and variable annuity products offered by an affiliate of HIMCO.
The Board also considered that HIMCO Distribution Services Company (“HDSC”), an affiliate of HIMCO, serves as principal underwriter of the Fund. As principal underwriter, HDSC receives distribution and service (12b-1) fees from the Fund. The Board reviewed information on the profitability of HDSC and noted that HDSC pays all 12b-1 fees received from the Fund to participating insurance companies or their affiliated broker-dealers, including insurance companies affiliated with HIMCO.
* * * *
Based upon its review of these various factors, among others, the Board, including all of the Independent Trustees, concluded that it is in the best interests of the Fund and its shareholders for the Board to approve the Agreement for an additional year. In reaching this decision, the Board did not assign relative weights to the factors discussed above or deem any one or group of them to be controlling in and of themselves.
THIS PRIVACY POLICY IS NOT PART OF THIS REPORT
Privacy Policy and Practices of The Hartford Financial Services Group, Inc. and its Affiliates
(herein called “we, our and us”)
This Privacy Policy applies to our United States Operations
We value your trust. We are committed to the responsible:
a) management;
b) use; and
c) protection;
of Personal Information.
This notice describes how we collect, disclose, and protect Personal Information.
We collect Personal Information to:
a) service your Transactions with us; and
b) support our business functions.
We may obtain Personal Information from:
a) You;
b) your Transactions with us; and
c) third parties such as a consumer-reporting agency.
Based on the type of product or service You apply for or get from us, Personal Information such as:
a) your name;
b) your address;
c) your income;
d) your payment; or
e) your credit history;
may be gathered from sources such as applications,
Transactions, and consumer reports.
To serve You and service our business, we may share certain Personal Information. We will share Personal Information, only as allowed by law, with affiliates such as:
a) our insurance companies;
b) our employee agents;
c) our brokerage firms; and
d) our administrators.
As allowed by law, we may share Personal Financial Information with our affiliates to:
a) market our products; or
b) market our services;
to You without providing You with an option to prevent these disclosures.
We may also share Personal Information, only as allowed
by law, with unaffiliated third parties including:
a) independent agents;
b) brokerage firms;
c) insurance companies;
d) administrators; and
e) service providers;
who help us serve You and service our business.
When allowed by law, we may share certain Personal
Financial Information with other unaffiliated third parties who assist us by performing services or functions such as:
a) taking surveys;
b) marketing our products or services; or
c) offering financial products or services under a joint agreement between us and one or more financial institutions.
We, and third parties we partner with, may track some of the pages You visit through the use of:
a) cookies;
b) pixel tagging; or
c) other technologies;
and currently do not process or comply with any web browser’s “do not track” signal or similar mechanism that indicates a request to disable online tracking of individual users who visit our websites or use our services.
For more information, our Online Privacy Policy, which governs information we collect on our website and our affiliate websites, which is available at Online Privacy Policy.
We will not sell or share your Personal Financial Information with anyone for purposes unrelated to our business functions without offering You the opportunity to:
a) “opt-out;” or
b) “opt-in;”
as required by law.
We only disclose Personal Health Information with:
a) your proper written authorization; or
b) as otherwise allowed or required by law.
Our employees have access to Personal Information in the course of doing their jobs, such as:
a) underwriting policies;
b) paying claims;
c) developing new products; or
d) advising customers of our products and services.
We use manual and electronic security procedures to maintain:
a) the confidentiality; and
b) the integrity of;
Personal Information that we have. We use these procedures to guard against unauthorized access.
Some techniques we use to protect Personal Information include:
a) secured files;
b) user authentication;
c) encryption;
d) firewall technology; and
e) the use of detection software.
We are responsible for and must:
a) identify information to be protected;
b) provide an adequate level of protection for that data;
c) grant access to protected data only to those people who must use it in the performance of their job-related duties.
Employees who violate our privacy policies and procedures may be subject to discipline, which may include ending their employment with us.
We will continue to follow our Privacy Policy regarding Personal Information even when a business relationship no longer exists between us.
As used in this Privacy Notice:
Application means your request for our product or service.
Personal Financial Information means financial information such as:
a) credit history;
b) income;
c) financial benefits; or
d) policy or claim information.
Personal Financial Information may include Social Security Numbers, Driver’s license numbers, or other government-issued identification numbers, or credit, debit card, or bank account numbers.
Personal Health Information means health information such as:
a) your medical records; or
b) information about your illness, disability or injury.
Personal Information means information that identifies You personally and is not otherwise available to the public. It includes:
a) Personal Financial Information; and
b) Personal Health Information.
Transaction means your business dealings with us, such as:
a) your Application;
b) your request for us to pay a claim; and
c) your request for us to take an action on your account.
You means an individual who has given us Personal Information in conjunction with:
a) asking about;
b) applying for; or
c) obtaining;
a financial product or service from us if the product or service is used mainly for personal, family, or household purposes.
This Customer Privacy Notice is being provided on behalf of The Hartford Financial Services Group, Inc. and its affiliates, to the extent required by the Gramm-Leach-Bliley Act and implementing regulations.
1stAGChoice, Inc.; Access CoverageCorp, Inc.; Access CoverageCorp Technologies, Inc.; American Maturity Life Insurance Company; Archway 60 R, LLC; Business Management Group, Inc.; DMS R, LLC; First State Insurance Company; Fountain Investors I LLC; Fountain Investors II LLC; Fountain Investors III LLC; Fountain Investors IV LLC; FP R, LLC (Delaware); FTC Resolution Company LLC; Hart Re Group L.L.C.; Hartford Accident and Indemnity Company; Hartford Administrative Services Company; Hartford Casualty General Agency, Inc.; Hartford Casualty Insurance Company; Hartford Financial Services, LLC; Hartford Fire General Agency, Inc.; Hartford Fire Insurance Company; Hartford Funds Distributors, LLC; Hartford Funds Management Company, LLC; Hartford Funds Management Group, Inc.; Hartford Group Benefits Holding Company; Hartford Holdings, Inc.; Hartford HLS Series Fund II, Inc.; Hartford Insurance Company of Illinois; Hartford Insurance Company of the Midwest; Hartford Insurance Company of the Southeast; Hartford Integrated Technologies, Inc.; Hartford International Life Reassurance Corporation; Hartford Investment Management Company; Hartford Life and Accident Insurance Company; Hartford Life and Annuity Insurance Company; Hartford Life Insurance Company; Hartford Life, Inc.; Hartford Life International Holding Company; Hartford Life Private Placement, LLC; Hartford Lloyd’s Corporation; Hartford Lloyd’s Insurance Company; Hartford of Texas General Agency, Inc.; Hartford Residual Market, L.C.C.; Hartford Securities Distribution Company, Inc.; Hartford Series Fund, Inc.; Hartford Specialty Insurance Services of Texas, LLC; Hartford Strategic Investments, LLC; Hartford Underwriters General Agency, Inc.; Hartford Underwriters Insurance Company; Hartford-Comprehensive Employee Benefit Service Company; HDC R, LLC .; Heritage Holdings, Inc.; HIMCO Distribution Services Company; HIMCO Variable Insurance Trust; HLA LLC; HL Investment Advisors, LLC; Horizon Management Group, LLC; HRA Brokerage Services, Inc.; Lanidex Class B, LLC; ; Lanidex R, LLC (Delaware); Lattice Strategies LLC; Maxum Casualty Insurance Company; Maxum Indemnity Company; Maxum Specialty Services Corporation; MPC Resolution Company LLC; New England Insurance Company; New England Reinsurance Corporation; Northern Homelands Company; Nutmeg Insurance Agency, Inc.; Nutmeg Insurance Company; Pacific Insurance Company, Limited; Property and Casualty Insurance Company of Hartford; Sentinel Insurance Company, Ltd.; Trumbull Flood Management, L.L.C.; Trumbull Insurance Company; Twin City Fire Insurance Company.
Revised March 2017

This report is prepared for the general information of contract owners and qualified retirement plan participants. It is not an offer to buy or sell an annuity contract or qualified retirement plan, fund or any security. It should not be used in connection with any offer, except in conjunction with the appropriate product prospectus (which contains all pertinent product information including the applicable sales, administrative and other charges) and the current prospectus and/or summary prospectus of the Fund available for investment thereunder.
The information cannot be used or relied upon for the purpose of avoiding IRS penalties. These materials are not intended to provide tax, accounting or legal advice. As with all matters of a tax or legal nature, you should consult your own tax or legal counsel for advice.
You should carefully consider investment objectives, risks, and charges and expenses of the HIMCO VIT Index Fund before investing. This and other information can be found in the Fund’s prospectus or summary prospectus, which can be obtained from your investment representative or from www.hvitfunds.com. Please read them carefully before investing.
Hartford Investment Management is an SEC-registered investment adviser. SEC registration does not imply a certain level of skill or training; nor does it imply that the SEC has sponsored, recommended, or otherwise approved of Hartford Investment Management.
Distributor: HIMCO Distribution Services Company, member FINRA, SIPC, a broker-dealer affiliated with Hartford Investment Management. Not FDIC Insured – No Bank Guarantee – May Lose Value

A MESSAGE FROM THE PRESIDENT
Dear Shareholders:
Thank you for investing in the HIMCO Variable Insurance Trust (HVIT) funds.
Market Review
2017 was a very strong year for financial markets and investment returns. A key driver was synchronized economic growth across the globe. For the first time in the post-2008 financial crisis period, the major economies of the U.S., Europe, Japan, China and the Emerging Markets all experienced accelerating economic growth at the same time.
U.S. companies benefited strongly from this uptick in global growth, and a weaker U.S. dollar versus most currencies helped increase the competitiveness of U.S. products and services in foreign markets. U.S. fiscal policy has taken on a clear pro-growth stance with the passage of tax reform and rollback of regulations. Monetary policy continues to be well telegraphed and a successor, Jerome Powell, is set to replace U.S. Federal Reserve (Fed) Chair Janet Yellen in early 2018. Powell is a choice that the market appears to be very comfortable with and is expected to represent a high degree of continuity from the Yellen-led Fed.
The second half of 2017 saw U.S. GDP growth accelerate to nearly 3%. The U.S. unemployment rate sits just above 4%, the lowest level since 2000. Often, stronger economic growth and low levels of unemployment lead to an increase in interest rates as market participants anticipate higher levels of inflation, and/or actions by the Fed to increase rates to head-off inflation. But longer-dated U.S. Treasury rates have not increased. The 10 year treasury yield ended 2016 at 2.44% and ended 2017 at 2.40%. Accelerating growth with sustained low interest rates provide a strong foundation for financial assets. Volatility measures were muted all year and the S&P 500 posted positive returns in all 12 months of 2017.
For the full year, U.S. stocks and bonds delivered very strong performance. U.S. stocks (as represented by the S&P500 Index1) returned 21.8% – the ninth consecutive year of positive returns, while U.S. bonds (as represented by the Bloomberg Barclays U.S. Aggregate Bond Index2) returned 3.5%.
As we enter 2018, the global economy has positive momentum and U.S. corporations are set to receive the biggest tax cut in the last 30 years. In our view, signs appear to point to a continued favorable outlook in 2018. We expect U.S. growth to moderate slightly from 2017, but continue to provide a strong economic backdrop for financial markets. In 2017, persistent U.S. dollar weakness and the strong recovery in capital expenditure from the industrial recession of 2015/16 fueled economic outperformance, which will be difficult to replicate in 2018. However, we believe that increased consumer spending and capital expenditures driven by tax reform could be catalysts for a further upside surprise in growth.
As with any outlook, there are risks and uncertainties. We expect Central Banks to continue to pull back the securities purchase programs they initiated post-2008 financial crisis to lower interest rates and stimulate economic growth. These “Quantitative Easing” programs were instrumental in promoting growth. Just as there was uncertainty as to the effects of these programs when they were ramping up, there are many questions as to the impacts of their withdrawal.
International tensions remain a risk for 2018. Looming North American Free Trade Agreement negotiations, China, Brexit, and North Korea remain key flashpoints. We expect longer term interest rates to continue to move higher and the yield curve to continue to flatten over the course of 2018. We believe the Fed is likely to continue raising short-term interest rates, with risks that they either increase too quickly and severely dampen economic growth, or increase too slowly and let inflation get out of hand.
We are reminded on a regular basis that financial markets can often surprise, which is why you should consider regular reviews with your financial advisor. Your advisor can help you understand market issues, invest with confidence, and help ensure that your investment goals, time horizon and risk tolerance are what drive your investment strategy.
Thank you again for investing with the HIMCO Variable Insurance Trust funds.

Matthew J. Poznar
President, HVIT
1 | The S&P 500 Index is a market capitalization-weighted index designed to measure market results for large-capitalization United States equities. |
2 | The Bloomberg Barclays U.S. Aggregate Bond Index is a broad-based flagship benchmark that measures the investment grade, US dollar-denominated, fixed-rate taxable bond market. The index includes Treasuries, government-related and corporate securities, MBS (agency fixed-rate and hybrid ARM pass-throughs), ABS and CMBS (agency and non-agency). |
HIMCO VIT Portfolio Diversifier Fund
Table of Contents
This report is prepared for the general information of contract owners and qualified retirement plan participants. It is not an offer to buy or sell an annuity contract or qualified retirement plan, fund or any security. It should not be used in connection with any offer, except in conjunction with the appropriate product prospectus (which contains all pertinent product information including the applicable sales, administrative and other charges) and the current prospectus and/or summary prospectus of the Fund available for investment thereunder.
The views expressed in the President’s Letter above and, to the extent included herein, the Fund’s Manager Discussion under “Why did the Fund perform this way?” and “What is your outlook?” are views of the Fund’s adviser and portfolio management team through the end of the period and are subject to change based on market and other conditions. The President’s Letter and, to the extent included herein, the Fund’s Manager Discussion, are for informational purposes only and do not represent investment advice or an offer, recommendation or solicitation to buy, hold or sell any security. The specific securities identified and described, if any, do not represent all of the securities purchased or sold and you should not assume that investments in the securities identified and discussed will be profitable.
HIMCO VIT Portfolio Diversifier Fund
| | |
(The Fund is advised by Hartford Investment Management Company (“Hartford Investment Management”)) | | Investment Goal: The Fund seeks to produce investment performance that mitigates against significant declines in the aggregate value of investment allocations to equity mutual funds under certain variable annuity contracts, while also preserving the potential for modest appreciation in the Fund’s net asset value when markets are appreciating. |
Performance information for periods prior to October 20, 2014 is that of the Hartford Portfolio Diversifier HLS Fund (the “Predecessor Fund”). Hartford Funds Management Company, LLC served as the investment manager to the Predecessor Fund and Hartford Investment Management, the Fund’s adviser, served as sub-adviser to the Predecessor Fund. The Predecessor Fund had the same investment objective and strategies as the Fund.

The chart above represents the hypothetical growth of a $10,000 investment in Class IB.
Average Annual Total Returns (as of 12/31/17)
| | | | | | | | | | | | |
| | 1 Year | | | 5 Years | | | Since Inception† | |
HIMCO VIT Portfolio Diversifier Fund IB | | | -3.36% | | | | -5.05% | | | | -4.67% | |
Bloomberg Barclays U.S. Aggregate Bond Index | | | 3.54% | | | | 2.10% | | | | 2.92% | |
S&P 500 Index | | | 21.83% | | | | 15.79% | | | | 14.00% | |
PERFORMANCE DATA QUOTED REPRESENTS PAST PERFORMANCE AND DOES NOT GUARANTEE FUTURE RESULTS. The investment return and principal value of the investment will fluctuate so that investors’ shares, when redeemed, may be worth more or less than their original cost. Current performance may be lower or higher than the performance data quoted.
Total returns presented above were calculated using the Fund’s net asset value available to shareholders for sale or redemption of Fund shares on December 31, 2017, which may exclude investment transactions as of this date. All share class returns assume the reinvestment of all distributions at net asset value and the deduction of all fund expenses.
Bloomberg Barclays U.S. Aggregate Bond Index is a broad-based flagship benchmark that measures the investment grade, US dollar-denominated, fixed-rate taxable bond market. The index includes Treasuries, government-related and corporate securities, MBS (agency fixed-rate and hybrid ARM pass-throughs), ABS and CMBS (agency and non-agency).
S&P 500 Index is a market capitalization-weighted index designed to measure market results for large-capitalization United States equities.*
* The S&P 500 Index is a product of S&P Dow Jones Indices LLC (“SPDJI”), and has been licensed for use by HIMCO Variable Insurance Trust. Standard & Poor’s® and S&P® are registered trademarks of Standard & Poor’s Financial Services LLC (“S&P”); Dow Jones® is a registered trademark of Dow Jones Trademark Holdings LLC (“Dow Jones”); and these trademarks have been licensed for use by SPDJI and sublicensed for certain purposes by HIMCO Variable Insurance Trust. The Fund is not sponsored, endorsed, sold or promoted by SPDJI, Dow Jones, S&P, or their respective affiliates, and none of such parties make any representation regarding the advisability of investing in such product(s) nor do they have any liability for any errors, omissions, or interruptions of the S&P 500 Index.
The indices are unmanaged, and their results include reinvested dividends and/or distributions, but do not reflect the effect of sales charges, commissions, expenses or taxes. You cannot invest directly in an index.
| | | | | | | | |
Operating Expenses* | | Net | | | Gross | |
HIMCO VIT Portfolio Diversifier Fund | | | 0.85% | | | | 0.97% | |
* | As shown in the Fund’s current prospectus dated April 30, 2017. Actual expenses may be higher or lower. Please see the accompanying Financial Highlights for expense ratios for the year ended December 31, 2017. |
Gross operating expenses shown are before management fee waivers or expense caps. Performance information may reflect historical or current expense waivers or reimbursements, without which, performance would have been lower.
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HIMCO VIT Portfolio Diversifier Fund |
Net operating expenses are the expenses paid to own the Fund. If the net operating expenses shown are lower than the gross operating expenses, then the net operating expenses reflect contractual management fee waivers and/or expense reimbursements that may not be renewed. The current contractual arrangement with respect to expense reimbursements remains in effect until April 30, 2018, and shall renew automatically for one-year terms unless the investment manager provides written notice of termination prior to the start of the next term or upon approval of the Board of Trustees of the Fund.
The chart and table do not reflect the deductions of taxes, sales charges or other fees which may be applied at the variable life insurance, variable annuity or qualified retirement plan product level. Any such additional sales charges or other fees or expenses would lower the contract’s or plan’s performance.
All investments are subject to risk, including the possible loss of principal. The main risks of investing in the Fund are described below. For more detailed information on the risks associated with an investment in the Fund, please see the prospectus.
Fund Strategy Risk – The Fund is available solely to holders of variable annuity contracts issued by Hartford Life Insurance Company (“Hartford Life”) and its affiliates and by Forethought Life Insurance Company (“Forethought”), an unaffiliated insurance company, who have elected a guaranteed benefit rider subject to an allocation requiring investment in the Fund (a “Rider”). The Fund is designed to replicate the performance of the Portfolio Diversifier Index (the “Index”). The Index is a composite index designed by Hartford Life and calculated by Hartford Investment Management. The Index is intended to produce investment performance that mitigate against significant declines in the aggregate value of investment allocations to the equity mutual funds (the “Allocated Funds”) held by Rider holders. Hartford Life and its affiliates and Forethought have financial obligations to holders of the Riders arising from guarantee obligations under the Riders. To the extent that the Fund’s strategy is successful, Hartford Life and its affiliates and Forethought will benefit from a reduction of the risk arising from their guarantee obligations under the Riders, and they will have less risk to hedge under the Riders than would be the case if holders did not allocate to the Fund.
As a holder of a Rider, you also will have exposure to changes in the values of the Allocated Funds, although your particular exposure will differ from the aggregated exposure that the Index is designed to address, depending on your allocations and investment activity, among other factors. Although the Fund may have the effect of mitigating declines in your contract value under a Rider in the event of a significant decline in equity market valuations, the strategy followed by the Fund, if successful, will also generally result in your contract value increasing to a lesser degree than the equity markets, or decreasing, when the values of equity investments are stable or rising. This may deprive you of some or all of the benefit of increases in equity market values under your contract and could also result in a decrease in the value of your variable annuity contract. Depending on future market conditions, you might benefit more from selecting alternative allocations under a guaranteed benefit rider (if available) or alternate investments. In addition, there is no guarantee that the Fund’s strategy will have its intended effect, and it may not work as effectively as is intended. Depending on your particular allocation to the Allocated Funds under a Rider the Fund’s strategy may be more or less effective in mitigating potential losses under your variable annuity contract than may be the case for others who elect a Rider and allocate contract value differently among the Allocated Funds. In particular, the Fund’s investment strategy is not as likely to be as effective with respect to allocations that have relatively lower anticipated correlation to the investment performance of the S&P 500 Index.
Hartford Life’s and Forethought’s financial interest in reducing the volatility of overall contract value invested under the Riders, in light of their obligations under the Riders, may be deemed to present a potential conflict of interest with respect to the interests of the holders of the Riders, in that Hartford Life’s and Forethought’s interest may at times conflict with the Fund’s goal of preserving the potential for modest appreciation in the Fund’s net asset value when markets are appreciating. Hartford Investment Management and
HIMCO Variable Insurance Trust, on behalf of the Fund, have developed procedures designed to address this potential conflict by (i) specifying the processes for developing and communicating the data used to calculate the Index, calculating the Index and managing the Fund to replicate the performance of the Index and (ii) monitoring for compliance with the specified processes.
Derivatives Risk – Derivatives are instruments whose value depends on, or is derived from, the value of an underlying asset, reference rate or index. Derivatives may be riskier than other types of investments because they may be more sensitive to changes in economic or market conditions than other types of investments and could result in losses that significantly exceed the Fund’s original investment. Successful use of derivative instruments by the Fund depends on the investment manager’s judgment with respect to a number of factors and the Fund’s performance could be worse and/or more volatile than if it had not used these instruments. In addition, the fluctuations in the value of derivatives may not correlate perfectly with the value of any portfolio assets being hedged, the performance of the asset class to which the investment manager seeks exposure, or the overall securities markets.
Hedging Risk – Hedging is a strategy in which the Fund uses a derivative to offset the risks associated with other Fund holdings. While hedging can reduce losses, it can also reduce or eliminate gains or cause losses if the market moves in a manner different from that anticipated by the Fund or if the cost of the derivative outweighs the benefit of the hedge. Hedging also involves the risk that changes in the value of the derivative will not match those of the holdings being hedged as expected by the Fund, in which case any losses on the holdings being hedged may not be reduced and may be increased. There can be no assurance that the Fund’s hedging strategy will reduce risk or that hedging transactions will be either available or cost effective.
Leverage Risk – Leverage can increase market exposure, magnify investment risks, and cause losses to be realized more quickly. Leverage may also cause the Fund to be more volatile than if it had not been leveraged. The use of leverage may cause the Fund to liquidate portfolio positions to satisfy its obligations or to meet asset segregation requirements when it may not be advantageous to do so.
Futures and Options Risks – Futures and options may be more volatile than direct investments in the securities underlying the futures and options, may not correlate perfectly to the underlying securities, may involve additional costs, and may be illiquid. Futures and options may also involve the use of leverage as a Fund may make a small initial investment relative to the risk assumed, which could result in losses greater than if futures or options had not been used. Futures and options are also subject to the risk that the other party to the transaction may default on its obligation.
Market Risk – Market risk is the risk that one or more markets in which the Fund invests will go down in value, including the possibility that the markets will go down sharply and unpredictably. Securities may decline in value due to the activities and financial prospects of individual companies or to general market and economic movements and trends, including adverse changes to credit markets.
Index and Information Risk – The data used by Hartford Investment Management to calculate the Index may not always be current. To the extent the data, and in particular the market-related data, is outdated or inaccurate, the sleeve consisting of (i) a basket of derivatives that generally will increase in value if the S&P 500 Index decreases significantly in value and will generally decrease in value when the S&P 500 Index remains level or increases in value; and (ii) holdings of Treasury securities and other cash investments (the “Derivative Sleeve”) may fail to hedge or may hedge less effectively against equity market declines. In addition, when the values of investments are increasing, the Fund’s value could increase to a lesser extent, or decrease to a greater extent, than would be the case if the data used to calculate the Index were current.
In addition, the Index is intended to hedge against the aggregate allocations of holders of the Riders to the Allocated Funds and not the allocation of any
|
HIMCO VIT Portfolio Diversifier Fund |
individual contract owner. The Derivative Sleeve may not be successful in providing an effective hedge, and the hedge, even if effective, will benefit some Rider holders more than others, depending upon the allocations to funds selected by the holders. In particular, contract owners whose allocations have a relatively higher anticipated correlation to the investment performance of the S&P 500 Index will benefit to a greater extent from the hedge during periods of equity market declines.
Investment Strategy Risk – The risk that, if the investment manager’s investment strategy does not perform as expected, the Fund could underperform its peers or lose money. There is no guarantee that the Fund’s investment objective will be achieved.
Liquidity Risk – The risk that a particular investment may be difficult to sell and that the Fund may be unable to sell the investment at an advantageous time or price. Securities that are liquid at the time of purchase may later become illiquid due to events relating to the issuer of the securities, market events, economic conditions or investor perceptions. Illiquid securities may be difficult to value and their value may be lower than the market price of comparable liquid securities, which would negatively affect the Fund’s net asset value.
Credit Risk – Credit risk is the risk that the issuer of a security or other instrument will not be able to make principal and interest payments when due. Changes in an issuer’s financial strength, credit rating or the market’s perception of an issuer’s creditworthiness may also affect the value of the Fund’s investment in that issuer. The degree of credit risk depends on both the financial condition of the issuer and the terms of the obligation.
Interest Rate Risk – The risk that your investment may go down in value when interest rates rise, because when interest rates rise, the prices of bonds fall. Generally, the longer the maturity of a bond, the more sensitive it is to this risk. Falling interest rates also create the potential for a decline in the Fund’s income. These risks are greater during periods of rising inflation. Volatility in interest rates and in fixed income markets may increase the risk that the Fund’s investment in fixed income securities will go down in value. Risks associated with rising interest rates are currently heightened because interest rates in the U.S. are at, or near, historic lows.
U.S. Government Securities Risk – Treasury obligations may differ in their interest rates, maturities, times of issuance and other characteristics. U.S. government securities may be guaranteed as to the timely payment of interest and principal but not market value. Obligations of U.S. Government agencies and authorities are supported by varying degrees of credit but generally are not backed by the full faith and credit of the U.S. Government. No assurance can be given that the U.S. Government will provide financial support to its agencies and authorities if it is not obligated by law to do so. In addition, the value of U.S. Government securities may be affected by changes in the credit rating of the U.S. Government. U.S. Government securities are also subject to default risk, that is the risk that the U.S. Treasury will be unable to meet its payment obligations.
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HIMCO VIT Portfolio Diversifier Fund |
Manager Discussion
December 31, 2017
Portfolio Manager
Paul Bukowski, CFA
Executive Vice President and Head of Quantitative Equities
How did the Fund perform?
The Class IB Shares of the HIMCO VIT Portfolio Diversifier Fund (the “Fund”) returned -3.36% for the 12-month period ending December 31, 2017, compared to the returns of the Bloomberg Barclays U.S. Aggregate Bond Index, which returned 3.54%, and the S&P 500 Index, which returned 21.83%, during the same period.
Why did the Fund perform this way?
The Fund performed in line with expectations, which is performance generally “contra” to that of the equity markets as measured by the S&P 500 Index. The Fund generally seeks to invest in derivative securities which are expected to increase in value if the S&P 500 Index declines, as well as securities which are expected to approximate the performance of the Bloomberg Barclays U.S. Aggregate Bond and S&P 500 Indices.
The Fund decreased in value as the S&P 500 Index appreciated 21.83% over the 12-month period. The Fund’s derivative securities, short S&P 500 Index futures and a long-term S&P 500 Index put position, declined in value providing a headwind (i.e. negative impact) to performance. Although the Fund benefited from the positive performance of both the equity and fixed income sleeves, it could not offset the negative performance from the Fund’s derivative sleeve securities.
What is your outlook?
Looking into 2018, we believe equities can continue to deliver strong performance. We expect improved fundamentals based on recently passed tax reform to overshadow weaker technicals and persistently high valuations. The market has already priced in much of the upside of the tax legislation in our view, but we believe lower corporate tax rates should provide a tailwind to corporate earnings. Our outlook is sensitive to the outcome of midterm elections (which could challenge the longevity of tax reform) and meaningful reversal in economic growth.
Diversification by Security Type
as of December 31, 2017
| | | | |
Category | | Percentage of Net Assets | |
Equity Securities | | | | |
Common Stocks | | | 25.1 | % |
Exchange-Traded Funds | | | 0.3 | |
| | | | |
Total | | | 25.4 | % |
| | | | |
Fixed Income Securities | | | | |
Asset & Commercial Mortgage Backed Securities | | | 0.3 | % |
Corporate Bonds | | | 14.5 | |
Foreign Government Obligations | | | 1.1 | |
Municipal Bonds | | | 0.3 | |
U.S. Government Agencies | | | 14.9 | |
U.S. Government Securities | | | 18.4 | |
| | | | |
Total | | | 49.5 | % |
| | | | |
Put Options Purchased | | | 4.8 | % |
Short-Term Investments | | | 14.1 | |
Other assets and liabilities | | | 6.2 | |
| | | | |
Total | | | 100.0 | % |
| | | | |
Credit Exposure
as of December 31, 2017
| | | | |
Credit Rating* | | Percentage of Net Assets | |
AAA/Aaa | | | 21.3 | % |
AA/Aa | | | 15.9 | |
A | | | 7.0 | |
BBB/Baa | | | 5.2 | |
Not Rated | | | 0.1 | |
Non-Debt Securities and Other Short-Term Instruments | | | 44.3 | |
Other assets and liabilities | | | 6.2 | |
| | | | |
Total | | | 100.0 | % |
| | | | |
* | Credit exposure is the long-term credit ratings for the Fund’s holdings, as of the date noted, as provided by Standard and Poor’s Corporation (“S&P”), Moody’s Investors Service, Inc. (“Moody’s”) or Fitch. Inc. (“Fitch”) and typically range from AAA/Aaa (highest) to C/D (lowest). Presentation of S&P, Moody’s and Fitch credit ratings in this report have been selected for informational purposes for shareholders, as well as the Fund’s consideration of industry practice. If S&P, Moody’s and Fitch assign different ratings, the median rating is used. If only two agencies assign ratings, the lower rating is used. Fixed income securities that are not rated by either agency are listed as “Not Rated.” Ratings do not apply to the Fund itself or to the Fund’s shares. Ratings may change. |
|
HIMCO VIT Portfolio Diversifier Fund |
Schedule of Investments
December 31, 2017
| | | | | | | | |
Shares or Principal Amount | | Market Value(1) | |
COMMON STOCKS - 25.1% | |
| | | Automobiles & Components - 0.2% | | | |
| 836 | | | Aptiv plc | | $ | 70,918 | |
| 624 | | | BorgWarner, Inc. | | | 31,880 | |
| 12,275 | | | Ford Motor Co. | | | 153,315 | |
| 4,022 | | | General Motors Co. | | | 164,862 | |
| 775 | | | Goodyear Tire & Rubber Co. (The) | | | 25,040 | |
| 530 | | | Harley-Davidson, Inc. | | | 26,966 | |
| | | | | | | | |
| | | | | | | 472,981 | |
| | | | | | | | |
| | | Banks - 1.7% | | | |
| 30,517 | | | Bank of America Corp. | | | 900,862 | |
| 2,482 | | | BB&T Corp. | | | 123,405 | |
| 8,318 | | | Citigroup, Inc. | | | 618,942 | |
| 1,548 | | | Citizens Financial Group, Inc. | | | 64,985 | |
| 547 | | | Comerica, Inc. | | | 47,485 | |
| 2,220 | | | Fifth Third Bancorp | | | 67,355 | |
| 3,401 | | | Huntington Bancshares, Inc. | | | 49,519 | |
| 10,916 | | | JPMorgan Chase & Co. | | | 1,167,357 | |
| 3,383 | | | KeyCorp | | | 68,235 | |
| 474 | | | M&T Bank Corp. | | | 81,049 | |
| 1,085 | | | People’s United Financial, Inc. | | | 20,289 | |
| 1,497 | | | PNC Financial Services Group, Inc. (The) | | | 216,002 | |
| 3,649 | | | Regions Financial Corp. | | | 63,055 | |
| 1,498 | | | SunTrust Banks, Inc. | | | 96,756 | |
| 4,960 | | | US Bancorp | | | 265,757 | |
| 13,942 | | | Wells Fargo & Co. | | | 845,861 | |
| 628 | | | Zions Bancorp | | | 31,921 | |
| | | | | | | | |
| | | | | | | 4,728,835 | |
| | | | | | | | |
| | | Capital Goods - 1.9% | | | |
| 1,877 | | | 3M Co. | | | 441,789 | |
| 133 | | | Acuity Brands, Inc. | | | 23,408 | |
| 299 | | | Allegion plc | | | 23,788 | |
| 727 | | | AMETEK, Inc. | | | 52,686 | |
| 459 | | | AO Smith Corp. | | | 28,128 | |
| 1,332 | | | Arconic, Inc. | | | 36,297 | |
| 1,761 | | | Boeing Co. (The) | | | 519,336 | |
| 1,872 | | | Caterpillar, Inc. | | | 294,990 | |
| 491 | | | Cummins, Inc. | | | 86,730 | |
| 1,006 | | | Deere & Co. | | | 157,449 | |
| 490 | | | Dover Corp. | | | 49,485 | |
| 1,386 | | | Eaton Corp. plc | | | 109,508 | |
| 2,019 | | | Emerson Electric Co. | | | 140,704 | |
| 904 | | | Fastenal Co. | | | 49,440 | |
| 409 | | | Flowserve Corp. | | | 17,231 | |
| 440 | | | Fluor Corp. | | | 22,726 | |
| 962 | | | Fortive Corp. | | | 69,601 | |
| 485 | | | Fortune Brands Home & Security, Inc. | | | 33,193 | |
| 873 | | | General Dynamics Corp. | | | 177,612 | |
| 27,283 | | | General Electric Co. | | | 476,088 | |
| 375 | | | Harris Corp. | | | 53,119 | |
| 2,397 | | | Honeywell International, Inc. | | | 367,604 | |
| 970 | | | Illinois Tool Works, Inc. | | | 161,844 | |
| 786 | | | Ingersoll-Rand plc | | | 70,103 | |
| 379 | | | Jacobs Engineering Group, Inc. | | | 24,999 | |
| 2,911 | | | Johnson Controls International plc | | | 110,938 | |
| 246 | | | L3 Technologies, Inc. | | | 48,671 | |
| 784 | | | Lockheed Martin Corp. | | | 251,703 | |
| 990 | | | Masco Corp. | | | 43,501 | |
| 547 | | | Northrop Grumman Corp. | | | 167,880 | |
| 1,106 | | | PACCAR, Inc. | | | 78,614 | |
| 419 | | | Parker-Hannifin Corp. | | | 83,624 | |
| | | | | | | | |
Shares or Principal Amount | | Market Value(1) | |
COMMON STOCKS - 25.1% - (continued) | |
| | | Capital Goods - 1.9% - (continued) | | | |
| 520 | | | Pentair plc | | $ | 36,722 | |
| 487 | | | Quanta Services, Inc.(2) | | | 19,047 | |
| 909 | | | Raytheon Co. | | | 170,756 | |
| 404 | | | Rockwell Automation, Inc. | | | 79,325 | |
| 517 | | | Rockwell Collins, Inc. | | | 70,116 | |
| 322 | | | Roper Technologies, Inc. | | | 83,398 | |
| 179 | | | Snap-on, Inc. | | | 31,200 | |
| 482 | | | Stanley Black & Decker, Inc. | | | 81,791 | |
| 828 | | | Textron, Inc. | | | 46,857 | |
| 152 | | | TransDigm Group, Inc. | | | 41,742 | |
| 266 | | | United Rentals, Inc.(2) | | | 45,728 | |
| 2,336 | | | United Technologies Corp. | | | 298,004 | |
| 163 | | | WW Grainger, Inc. | | | 38,509 | |
| 565 | | | Xylem, Inc. | | | 38,533 | |
| | | | | | | | |
| | | | | | | 5,354,517 | |
| | | | | | | | |
| | | Commercial & Professional Services - 0.1% | |
| 271 | | | Cintas Corp. | | | 42,230 | |
| 378 | | | Equifax, Inc. | | | 44,574 | |
| 1,142 | | | IHS Markit Ltd.(2) | | | 51,561 | |
| 1,053 | | | Nielsen Holdings plc | | | 38,329 | |
| 714 | | | Republic Services, Inc. | | | 48,273 | |
| 394 | | | Robert Half International, Inc. | | | 21,883 | |
| 276 | | | Stericycle, Inc.(2) | | | 18,765 | |
| 489 | | | Verisk Analytics, Inc.(2) | | | 46,944 | |
| 1,256 | | | Waste Management, Inc. | | | 108,393 | |
| | | | | | | | |
| | | | | | | 420,952 | |
| | | | | | | | |
| | | Consumer Durables & Apparel - 0.3% | | | |
| 1,074 | | | DR Horton, Inc. | | | 54,849 | |
| 349 | | | Garmin Ltd. | | | 20,790 | |
| 1,148 | | | Hanesbrands, Inc. | | | 24,005 | |
| 357 | | | Hasbro, Inc. | | | 32,448 | |
| 414 | | | Leggett & Platt, Inc. | | | 19,760 | |
| 643 | | | Lennar Corp., Class A | | | 40,663 | |
| 1,079 | | | Mattel, Inc. | | | 16,595 | |
| 479 | | | Michael Kors Holdings Ltd.(2) | | | 30,153 | |
| 199 | | | Mohawk Industries, Inc.(2) | | | 54,904 | |
| 1,542 | | | Newell Brands, Inc. | | | 47,648 | |
| 4,134 | | | NIKE, Inc., Class B | | | 258,582 | |
| 850 | | | PulteGroup, Inc. | | | 28,262 | |
| 244 | | | PVH Corp. | | | 33,479 | |
| 174 | | | Ralph Lauren Corp. | | | 18,042 | |
| 895 | | | Tapestry, Inc. | | | 39,586 | |
| 593 | | | Under Armour, Inc., Class A(2) | | | 8,557 | |
| 552 | | | Under Armour, Inc., Class C(2) | | | 7,353 | |
| 1,032 | | | VF Corp. | | | 76,368 | |
| 226 | | | Whirlpool Corp. | | | 38,113 | |
| | | | | | | | |
| | | | | | | 850,157 | |
| | | | | | | | |
| | | Consumer Services - 0.5% | | | |
| 1,283 | | | Carnival Corp. | | | 85,153 | |
| 78 | | | Chipotle Mexican Grill, Inc.(2) | | | 22,544 | |
| 389 | | | Darden Restaurants, Inc. | | | 37,352 | |
| 656 | | | H&R Block, Inc. | | | 17,200 | |
| 636 | | | Hilton Worldwide Holdings, Inc. | | | 50,791 | |
| 963 | | | Marriott International, Inc., Class A | | | 130,708 | |
| 2,508 | | | McDonald’s Corp. | | | 431,677 | |
| 1,603 | | | MGM Resorts International | | | 53,524 | |
| 561 | | | Norwegian Cruise Line Holdings Ltd.(2) | | | 29,873 | |
| 539 | | | Royal Caribbean Cruises Ltd. | | | 64,292 | |
| 4,476 | | | Starbucks Corp. | | | 257,057 | |
The accompanying Notes are an integral part of these financial statements.
|
HIMCO VIT Portfolio Diversifier Fund |
Schedule of Investments – (continued)
December 31, 2017
| | | | | | | | |
Shares or Principal Amount | | Market Value(1) | |
COMMON STOCKS - 25.1% - (continued) | |
| | | Consumer Services - 0.5% - (continued) | | | |
| 319 | | | Wyndham Worldwide Corp. | | $ | 36,962 | |
| 252 | | | Wynn Resorts Ltd. | | | 42,485 | |
| 1,060 | | | Yum! Brands, Inc. | | | 86,507 | |
| | | | | | | | |
| | | | | | | 1,346,125 | |
| | | | | | | | |
| | | Diversified Financials - 1.4% | | | |
| 175 | | | Affiliated Managers Group, Inc. | | | 35,919 | |
| 2,266 | | | American Express Co. | | | 225,036 | |
| 465 | | | Ameriprise Financial, Inc. | | | 78,804 | |
| 3,222 | | | Bank of New York Mellon Corp. (The) | | | 173,537 | |
| 6,054 | | | Berkshire Hathaway, Inc., Class B(2) | | | 1,200,024 | |
| 388 | | | BlackRock, Inc. | | | 199,319 | |
| 1,525 | | | Capital One Financial Corp. | | | 151,859 | |
| 357 | | | Cboe Global Markets, Inc. | | | 44,479 | |
| 3,753 | | | Charles Schwab Corp. (The) | | | 192,792 | |
| 1,070 | | | CME Group, Inc. | | | 156,273 | |
| 1,142 | | | Discover Financial Services | | | 87,843 | |
| 851 | | | E*TRADE Financial Corp.(2) | | | 42,184 | |
| 1,028 | | | Franklin Resources, Inc. | | | 44,543 | |
| 1,104 | | | Goldman Sachs Group, Inc. (The) | | | 281,255 | |
| 1,840 | | | Intercontinental Exchange, Inc. | | | 129,830 | |
| 1,281 | | | Invesco Ltd. | | | 46,808 | |
| 986 | | | Leucadia National Corp. | | | 26,119 | |
| 523 | | | Moody’s Corp. | | | 77,200 | |
| 4,380 | | | Morgan Stanley | | | 229,819 | |
| 366 | | | NASDAQ, Inc. | | | 28,120 | |
| 850 | | | Navient Corp. | | | 11,322 | |
| 676 | | | Northern Trust Corp. | | | 67,526 | |
| 404 | | | Raymond James Financial, Inc. | | | 36,077 | |
| 802 | | | S&P Global, Inc. | | | 135,859 | |
| 1,167 | | | State Street Corp. | | | 113,911 | |
| 2,314 | | | Synchrony Financial | | | 89,343 | |
| 762 | | | T Rowe Price Group, Inc. | | | 79,957 | |
| | | | | | | | |
| | | | | | | 3,985,758 | |
| | | | | | | | |
| | | Energy - 1.5% | | | |
| 1,721 | | | Anadarko Petroleum Corp. | | | 92,314 | |
| 451 | | | Andeavor | | | 51,567 | |
| 1,198 | | | Apache Corp. | | | 50,580 | |
| 1,347 | | | Baker Hughes a GE Co. | | | 42,619 | |
| 1,455 | | | Cabot Oil & Gas Corp. | | | 41,613 | |
| 2,820 | | | Chesapeake Energy Corp.(2) | | | 11,167 | |
| 5,975 | | | Chevron Corp. | | | 748,010 | |
| 300 | | | Cimarex Energy Co. | | | 36,603 | |
| 468 | | | Concho Resources, Inc.(2) | | | 70,303 | |
| 3,761 | | | ConocoPhillips | | | 206,441 | |
| 1,653 | | | Devon Energy Corp. | | | 68,434 | |
| 1,819 | | | EOG Resources, Inc. | | | 196,288 | |
| 770 | | | EQT Corp. | | | 43,828 | |
| 13,330 | | | Exxon Mobil Corp. | | | 1,114,921 | |
| 2,745 | | | Halliburton Co. | | | 134,148 | |
| 342 | | | Helmerich & Payne, Inc. | | | 22,107 | |
| 850 | | | Hess Corp. | | | 40,350 | |
| 6,042 | | | Kinder Morgan, Inc. | | | 109,179 | |
| 2,673 | | | Marathon Oil Corp. | | | 45,254 | |
| 1,536 | | | Marathon Petroleum Corp. | | | 101,345 | |
| 1,196 | | | National Oilwell Varco, Inc. | | | 43,080 | |
| 643 | | | Newfield Exploration Co.(2) | | | 20,274 | |
| 1,531 | | | Noble Energy, Inc. | | | 44,613 | |
| 2,407 | | | Occidental Petroleum Corp. | | | 177,300 | |
| 1,206 | | | ONEOK, Inc. | | | 64,461 | |
| | | | | | | | |
Shares or Principal Amount | | Market Value(1) | |
COMMON STOCKS - 25.1% - (continued) | |
| | | Energy - 1.5% - (continued) | | | |
| 1,352 | | | Phillips 66 | | $ | 136,755 | |
| 535 | | | Pioneer Natural Resources Co. | | | 92,475 | |
| 702 | | | Range Resources Corp. | | | 11,976 | |
| 4,358 | | | Schlumberger Ltd. | | | 293,686 | |
| 1,379 | | | TechnipFMC plc | | | 43,176 | |
| 1,377 | | | Valero Energy Corp. | | | 126,560 | |
| 2,601 | | | Williams Cos., Inc. (The) | | | 79,305 | |
| | | | | | | | |
| | | | | | | 4,360,732 | |
| | | | | | | | |
| | | Food & Staples Retailing - 0.5% | | | |
| 1,375 | | | Costco Wholesale Corp. | | | 255,915 | |
| 3,187 | | | CVS Health Corp. | | | 231,057 | |
| 2,798 | | | Kroger Co. (The) | | | 76,805 | |
| 1,508 | | | Sysco Corp. | | | 91,581 | |
| 4,605 | | | Wal-Mart Stores, Inc. | | | 454,744 | |
| 2,731 | | | Walgreens Boots Allliance, Inc. | | | 198,325 | |
| | | | | | | | |
| | | | | | | 1,308,427 | |
| | | | | | | | |
| | | Food, Beverage & Tobacco - 1.1% | | | |
| 6,003 | | | Altria Group, Inc. | | | 428,674 | |
| 1,760 | | | Archer-Daniels-Midland Co. | | | 70,541 | |
| 616 | | | Brown-Forman Corp., Class B | | | 42,301 | |
| 605 | | | Campbell Soup Co. | | | 29,107 | |
| 12,063 | | | Coca-Cola Co. (The) | | | 553,450 | |
| 1,285 | | | Conagra Brands, Inc. | | | 48,406 | |
| 542 | | | Constellation Brands, Inc., Class A | | | 123,885 | |
| 568 | | | Dr Pepper Snapple Group, Inc. | | | 55,130 | |
| 1,788 | | | General Mills, Inc. | | | 106,010 | |
| 444 | | | Hershey Co. (The) | | | 50,398 | |
| 847 | | | Hormel Foods Corp. | | | 30,822 | |
| 357 | | | JM Smucker Co. (The) | | | 44,354 | |
| 783 | | | Kellogg Co. | | | 53,228 | |
| 1,878 | | | Kraft Heinz Co. (The) | | | 146,033 | |
| 377 | | | McCormick & Co., Inc. | | | 38,420 | |
| 581 | | | Molson Coors Brewing Co., Class B | | | 47,683 | |
| 4,701 | | | Mondelez International, Inc., Class A | | | 201,203 | |
| 1,295 | | | Monster Beverage Corp.(2) | | | 81,961 | |
| 4,474 | | | PepsiCo, Inc. | | | 536,522 | |
| 4,886 | | | Philip Morris International, Inc. | | | 516,206 | |
| 936 | | | Tyson Foods, Inc., Class A | | | 75,882 | |
| | | | | | | | |
| | | | | | | 3,280,216 | |
| | | | | | | | |
| | | Health Care Equipment & Services - 1.4% | |
| 5,476 | | | Abbott Laboratories | | | 312,515 | |
| 1,026 | | | Aetna, Inc. | | | 185,080 | |
| 227 | | | Align Technology, Inc.(2) | | | 50,437 | |
| 508 | | | AmerisourceBergen Corp. | | | 46,645 | |
| 808 | | | Anthem, Inc. | | | 181,808 | |
| 1,577 | | | Baxter International, Inc. | | | 101,937 | |
| 833 | | | Becton Dickinson and Co. | | | 178,368 | |
| 4,320 | | | Boston Scientific Corp.(2) | | | 107,093 | |
| 990 | | | Cardinal Health, Inc. | | | 60,657 | |
| 543 | | | Centene Corp.(2) | | | 54,778 | |
| 994 | | | Cerner Corp.(2) | | | 66,986 | |
| 776 | | | Cigna Corp. | | | 157,598 | |
| 154 | | | Cooper Cos., Inc. (The) | | | 33,554 | |
| 1,926 | | | Danaher Corp. | | | 178,771 | |
| 476 | | | DaVita, Inc.(2) | | | 34,391 | |
| 723 | | | DENTSPLY SIRONA, Inc. | | | 47,595 | |
| 666 | | | Edwards Lifesciences Corp.(2) | | | 75,065 | |
| 376 | | | Envision Healthcare Corp.(2) | | | 12,995 | |
| 1,782 | | | Express Scripts Holding Co.(2) | | | 133,008 | |
The accompanying Notes are an integral part of these financial statements.
|
HIMCO VIT Portfolio Diversifier Fund |
Schedule of Investments – (continued)
December 31, 2017
| | | | | | | | |
Shares or Principal Amount | | Market Value(1) | |
COMMON STOCKS - 25.1% - (continued) | |
| | | Health Care Equipment & Services - 1.4% - (continued) | |
| 891 | | | HCA Healthcare, Inc.(2) | | $ | 78,265 | |
| 494 | | | Henry Schein, Inc.(2) | | | 34,521 | |
| 867 | | | Hologic, Inc.(2) | | | 37,064 | |
| 449 | | | Humana, Inc. | | | 111,383 | |
| 274 | | | IDEXX Laboratories, Inc.(2) | | | 42,848 | |
| 352 | | | Intuitive Surgical, Inc.(2) | | | 128,459 | |
| 320 | | | Laboratory Corp. of America Holdings(2) | | | 51,043 | |
| 656 | | | McKesson Corp. | | | 102,303 | |
| 4,258 | | | Medtronic plc | | | 343,834 | |
| 257 | | | Patterson Cos., Inc. | | | 9,285 | |
| 429 | | | Quest Diagnostics, Inc. | | | 42,252 | |
| 446 | | | ResMed, Inc. | | | 37,772 | |
| 1,013 | | | Stryker Corp. | | | 156,853 | |
| 3,049 | | | UnitedHealth Group, Inc. | | | 672,183 | |
| 276 | | | Universal Health Services, Inc., Class B | | | 31,285 | |
| 288 | | | Varian Medical Systems, Inc.(2) | | | 32,011 | |
| 637 | | | Zimmer Biomet Holdings, Inc. | | | 76,867 | |
| | | | | | | | |
| | | | | | | 4,007,509 | |
| | | | | | | | |
| | | Household & Personal Products - 0.4% | | | |
| 786 | | | Church & Dwight Co., Inc. | | | 39,434 | |
| 406 | | | Clorox Co. (The) | | | 60,388 | |
| 2,763 | | | Colgate-Palmolive Co. | | | 208,468 | |
| 1,485 | | | Coty, Inc., Class A | | | 29,537 | |
| 704 | | | Estee Lauder Cos., Inc. (The), Class A | | | 89,577 | |
| 1,107 | | | Kimberly-Clark Corp. | | | 133,571 | |
| 8,016 | | | Procter & Gamble Co. (The) | | | 736,510 | |
| | | | | | | | |
| | | | | | | 1,297,485 | |
| | | | | | | | |
| | | Insurance - 0.7% | | | |
| 1,237 | | | Aflac, Inc. | | | 108,584 | |
| 1,129 | | | Allstate Corp. (The) | | | 118,218 | |
| 2,828 | | | American International Group, Inc. | | | 168,492 | |
| 786 | | | Aon plc | | | 105,324 | |
| 569 | | | Arthur J Gallagher & Co. | | | 36,006 | |
| 169 | | | Assurant, Inc. | | | 17,042 | |
| 301 | | | Brighthouse Financial, Inc.(2) | | | 17,651 | |
| 1,460 | | | Chubb Ltd. | | | 213,350 | |
| 470 | | | Cincinnati Financial Corp. | | | 35,236 | |
| 129 | | | Everest Re Group Ltd. | | | 28,543 | |
| 1,122 | | | Hartford Financial Services Group, Inc. (The)(3) | | | 63,146 | |
| 689 | | | Lincoln National Corp. | | | 52,964 | |
| 869 | | | Loews Corp. | | | 43,476 | |
| 1,605 | | | Marsh & McLennan Cos., Inc. | | | 130,631 | |
| 3,311 | | | MetLife, Inc. | | | 167,404 | |
| 845 | | | Principal Financial Group, Inc. | | | 59,623 | |
| 1,829 | | | Progressive Corp. (The) | | | 103,009 | |
| 1,334 | | | Prudential Financial, Inc. | | | 153,383 | |
| 337 | | | Torchmark Corp. | | | 30,569 | |
| 861 | | | Travelers Cos., Inc. (The) | | | 116,786 | |
| 706 | | | Unum Group | | | 38,752 | |
| 415 | | | Willis Towers Watson PLC | | | 62,536 | |
| 805 | | | XL Group Ltd. | | | 28,304 | |
| | | | | | | | |
| | | | | | | 1,899,029 | |
| | | | | | | | |
| | | Materials - 0.7% | | | |
| 686 | | | Air Products & Chemicals, Inc. | | | 112,559 | |
| 348 | | | Albemarle Corp. | | | 44,506 | |
| 278 | | | Avery Dennison Corp. | | | 31,931 | |
| 1,101 | | | Ball Corp. | | | 41,673 | |
| 734 | | | CF Industries Holdings, Inc. | | | 31,224 | |
| | | | | | | | |
Shares or Principal Amount | | Market Value(1) | |
COMMON STOCKS - 25.1% - (continued) | |
| | | Materials - 0.7% - (continued) | | | |
| 7,362 | | | DowDuPont, Inc. | | $ | 524,322 | |
| 452 | | | Eastman Chemical Co. | | | 41,873 | |
| 818 | | | Ecolab, Inc. | | | 109,759 | |
| 422 | | | FMC Corp. | | | 39,946 | |
| 4,236 | | | Freeport-McMoRan, Inc.(2) | | | 80,315 | |
| 248 | | | International Flavors & Fragrances, Inc. | | | 37,847 | |
| 1,299 | | | International Paper Co. | | | 75,264 | |
| 1,018 | | | LyondellBasell Industries N.V., Class A | | | 112,306 | |
| 198 | | | Martin Marietta Materials, Inc. | | | 43,766 | |
| 1,382 | | | Monsanto Co. | | | 161,390 | |
| 1,104 | | | Mosaic Co. (The) | | | 28,329 | |
| 1,678 | | | Newmont Mining Corp. | | | 62,959 | |
| 1,000 | | | Nucor Corp. | | | 63,580 | |
| 297 | | | Packaging Corp. of America | | | 35,803 | |
| 801 | | | PPG Industries, Inc. | | | 93,573 | |
| 901 | | | Praxair, Inc. | | | 139,367 | |
| 568 | | | Sealed Air Corp. | | | 28,002 | |
| 259 | | | Sherwin-Williams Co. (The) | | | 106,200 | |
| 416 | | | Vulcan Materials Co. | | | 53,402 | |
| 801 | | | WestRock Co. | | | 50,631 | |
| | | | | | | | |
| | | | | | | 2,150,527 | |
| | | | | | | | |
| | | Media - 0.7% | | | |
| 1,141 | | | CBS Corp., Class B | | | 67,319 | |
| 610 | | | Charter Communications, Inc., Class A(2) | | | 204,935 | |
| 14,673 | | | Comcast Corp., Class A | | | 587,654 | |
| 476 | | | Discovery Communications, Inc., Class A(2) | | | 10,653 | |
| 648 | | | Discovery Communications, Inc., Class C(2) | | | 13,718 | |
| 717 | | | DISH Network Corp., Class A(2) | | | 34,237 | |
| 1,223 | | | Interpublic Group of Cos., Inc. (The) | | | 24,656 | |
| 1,194 | | | News Corp., Class A | | | 19,355 | |
| 394 | | | News Corp., Class B | | | 6,540 | |
| 725 | | | Omnicom Group, Inc. | | | 52,802 | |
| 302 | | | Scripps Networks Interactive, Inc., Class A | | | 25,785 | |
| 2,449 | | | Time Warner, Inc. | | | 224,010 | |
| 3,316 | | | Twenty-First Century Fox, Inc., Class A | | | 114,501 | |
| 1,381 | | | Twenty-First Century Fox, Inc., Class B | | | 47,120 | |
| 1,110 | | | Viacom, Inc., Class B | | | 34,199 | |
| 4,751 | | | Walt Disney Co. (The) | | | 510,780 | |
| | | | | | | | |
| | | | | | | 1,978,264 | |
| | | | | | | | |
| | | Pharmaceuticals, Biotechnology & Life Sciences - 2.1% | |
| 5,015 | | | AbbVie, Inc. | | | 485,001 | |
| 1,013 | | | Agilent Technologies, Inc. | | | 67,841 | |
| 703 | | | Alexion Pharmaceuticals, Inc.(2) | | | 84,072 | |
| 1,046 | | | Allergan plc | | | 171,105 | |
| 2,284 | | | Amgen, Inc. | | | 397,188 | |
| 665 | | | Biogen, Inc.(2) | | | 211,849 | |
| 5,149 | | | Bristol-Myers Squibb Co. | | | 315,531 | |
| 2,477 | | | Celgene Corp.(2) | | | 258,500 | |
| 3,048 | | | Eli Lilly & Co. | | | 257,434 | |
| 4,109 | | | Gilead Sciences, Inc. | | | 294,369 | |
| 459 | | | Illumina, Inc.(2) | | | 100,287 | |
| 551 | | | Incyte Corp.(2) | | | 52,185 | |
| 458 | | | IQVIA Holdings, Inc.(2) | | | 44,838 | |
| 8,452 | | | Johnson & Johnson | | | 1,180,913 | |
| 8,605 | | | Merck & Co., Inc. | | | 484,203 | |
| 80 | | | Mettler-Toledo International, Inc.(2) | | | 49,562 | |
| 1,687 | | | Mylan N.V.(2) | | | 71,377 | |
| 347 | | | PerkinElmer, Inc. | | | 25,373 | |
| 412 | | | Perrigo Co. plc | | | 35,910 | |
The accompanying Notes are an integral part of these financial statements.
|
HIMCO VIT Portfolio Diversifier Fund |
Schedule of Investments – (continued)
December 31, 2017
| | | | | | | | |
Shares or Principal Amount | | Market Value(1) | |
COMMON STOCKS - 25.1% - (continued) | |
| | | Pharmaceuticals, Biotechnology & Life Sciences - 2.1% - (continued) | |
| 18,752 | | | Pfizer, Inc. | | $ | 679,197 | |
| 242 | | | Regeneron Pharmaceuticals, Inc.(2) | | | 90,982 | |
| 1,262 | | | Thermo Fisher Scientific, Inc. | | | 239,628 | |
| 796 | | | Vertex Pharmaceuticals, Inc.(2) | | | 119,289 | |
| 250 | | | Waters Corp.(2) | | | 48,297 | |
| 1,533 | | | Zoetis, Inc. | | | 110,437 | |
| | | | | | | | |
| | | | | | | 5,875,368 | |
| | | | | | | | |
| | | Real Estate - 0.7% | | | |
| 301 | | | Alexandria Real Estate Equities, Inc., REIT | | | 39,308 | |
| 1,349 | | | American Tower Corp., REIT | | | 192,462 | |
| 494 | | | Apartment Investment & Management Co., Class A, REIT | | | 21,593 | |
| 434 | | | AvalonBay Communities, Inc., REIT | | | 77,430 | |
| 485 | | | Boston Properties, Inc., REIT | | | 63,064 | |
| 950 | | | CBRE Group, Inc., Class A, REIT(2) | | | 41,144 | |
| 1,278 | | | Crown Castle International Corp., REIT | | | 141,871 | |
| 646 | | | Digital Realty Trust, Inc., REIT | | | 73,579 | |
| 1,120 | | | Duke Realty Corp., REIT | | | 30,475 | |
| 246 | | | Equinix, Inc., REIT | | | 111,492 | |
| 1,156 | | | Equity Residential, REIT | | | 73,718 | |
| 208 | | | Essex Property Trust, Inc., REIT | | | 50,205 | |
| 396 | | | Extra Space Storage, Inc., REIT | | | 34,630 | |
| 228 | | | Federal Realty Investment Trust, REIT | | | 30,281 | |
| 1,964 | | | GGP, Inc., REIT | | | 45,938 | |
| 1,476 | | | HCP, Inc., REIT | | | 38,494 | |
| 2,328 | | | Host Hotels & Resorts, Inc., REIT | | | 46,211 | |
| 885 | | | Iron Mountain, Inc., REIT | | | 33,391 | |
| 1,339 | | | Kimco Realty Corp., REIT | | | 24,303 | |
| 341 | | | Macerich Co. (The), REIT | | | 22,397 | |
| 357 | | | Mid-America Apartment Communities, Inc., REIT | | | 35,900 | |
| 1,674 | | | Prologis, Inc., REIT | | | 107,990 | |
| 471 | | | Public Storage, REIT | | | 98,439 | |
| 886 | | | Realty Income Corp., REIT | | | 50,520 | |
| 465 | | | Regency Centers Corp., REIT | | | 32,169 | |
| 370 | | | SBA Communications Corp., REIT(2) | | | 60,443 | |
| 978 | | | Simon Property Group, Inc., REIT | | | 167,962 | |
| 309 | | | SL Green Realty Corp., REIT | | | 31,187 | |
| 841 | | | UDR, Inc., REIT | | | 32,395 | |
| 1,120 | | | Ventas, Inc., REIT | | | 67,211 | |
| 543 | | | Vornado Realty Trust, REIT | | | 42,452 | |
| 1,165 | | | Welltower, Inc., REIT | | | 74,292 | |
| 2,375 | | | Weyerhaeuser Co., REIT | | | 83,742 | |
| | | | | | | | |
| | | | | | | 2,076,688 | |
| | | | | | | | |
| | | Retailing - 1.4% | | | |
| 233 | | | Advance Auto Parts, Inc. | | | 23,228 | |
| 1,258 | | | Amazon.com, Inc.(2) | | | 1,471,193 | |
| 87 | | | AutoZone, Inc.(2) | | | 61,889 | |
| 800 | | | Best Buy Co., Inc. | | | 54,776 | |
| 574 | | | CarMax, Inc.(2) | | | 36,811 | |
| 820 | | | Dollar General Corp. | | | 76,268 | |
| 746 | | | Dollar Tree, Inc.(2) | | | 80,053 | |
| 387 | | | Expedia, Inc. | | | 46,351 | |
| 390 | | | Foot Locker, Inc. | | | 18,283 | |
| 685 | | | Gap, Inc. (The) | | | 23,331 | |
| 461 | | | Genuine Parts Co. | | | 43,800 | |
| 3,674 | | | Home Depot, Inc. (The) | | | 696,333 | |
| 531 | | | Kohl’s Corp. | | | 28,796 | |
| | | | | | | | |
Shares or Principal Amount | | Market Value(1) | |
COMMON STOCKS - 25.1% - (continued) | |
| | | Retailing - 1.4% - (continued) | | | |
| 777 | | | L Brands, Inc. | | $ | 46,791 | |
| 973 | | | LKQ Corp.(2) | | | 39,572 | |
| 2,620 | | | Lowe’s Cos., Inc. | | | 243,503 | |
| 959 | | | Macy’s, Inc. | | | 24,157 | |
| 1,361 | | | Netflix, Inc.(2) | | | 261,258 | |
| 366 | | | Nordstrom, Inc. | | | 17,341 | |
| 268 | | | O’Reilly Automotive, Inc.(2) | | | 64,465 | |
| 153 | | | Priceline Group, Inc. (The)(2) | | | 265,874 | |
| 1,213 | | | Ross Stores, Inc. | | | 97,343 | |
| 187 | | | Signet Jewelers Ltd. | | | 10,575 | |
| 1,710 | | | Target Corp. | | | 111,578 | |
| 321 | | | Tiffany & Co. | | | 33,368 | |
| 2,002 | | | TJX Cos., Inc. (The) | | | 153,073 | |
| 395 | | | Tractor Supply Co. | | | 29,526 | |
| 336 | | | TripAdvisor, Inc.(2) | | | 11,579 | |
| 184 | | | Ulta Salon Cosmetics & Fragrance, Inc.(2) | | | 41,153 | |
| | | | | | | | |
| | | | | | | 4,112,268 | |
| | | | | | | | |
| | | Semiconductors & Semiconductor Equipment - 1.0% | |
| 2,580 | | | Advanced Micro Devices, Inc.(2) | | | 26,522 | |
| 1,160 | | | Analog Devices, Inc. | | | 103,275 | |
| 3,355 | | | Applied Materials, Inc. | | | 171,508 | |
| 1,279 | | | Broadcom Ltd. | | | 328,575 | |
| 14,723 | | | Intel Corp. | | | 679,614 | |
| 493 | | | KLA-Tencor Corp. | | | 51,799 | |
| 509 | | | Lam Research Corp. | | | 93,692 | |
| 736 | | | Microchip Technology, Inc. | | | 64,680 | |
| 3,628 | | | Micron Technology, Inc.(2) | | | 149,183 | |
| 1,906 | | | NVIDIA Corp. | | | 368,811 | |
| 400 | | | Qorvo, Inc.(2) | | | 26,640 | |
| 4,638 | | | QUALCOMM, Inc. | | | 296,925 | |
| 578 | | | Skyworks Solutions, Inc. | | | 54,881 | |
| 3,100 | | | Texas Instruments, Inc. | | | 323,764 | |
| 789 | | | Xilinx, Inc. | | | 53,194 | |
| | | | | | | | |
| | | | | | | 2,793,063 | |
| | | | | | | | |
| | | Software & Services - 3.6% | | | |
| 1,944 | | | Accenture plc, Class A | | | 297,607 | |
| 2,379 | | | Activision Blizzard, Inc. | | | 150,638 | |
| 1,551 | | | Adobe Systems, Inc.(2) | | | 271,797 | |
| 532 | | | Akamai Technologies, Inc.(2) | | | 34,601 | |
| 151 | | | Alliance Data Systems Corp. | | | 38,275 | |
| 938 | | | Alphabet, Inc., Class A(2) | | | 988,089 | |
| 950 | | | Alphabet, Inc., Class C(2) | | | 994,080 | |
| 267 | | | ANSYS, Inc.(2) | | | 39,407 | |
| 690 | | | Autodesk, Inc.(2) | | | 72,333 | |
| 1,395 | | | Automatic Data Processing, Inc. | | | 163,480 | |
| 988 | | | CA, Inc. | | | 32,881 | |
| 888 | | | Cadence Design Systems, Inc.(2) | | | 37,136 | |
| 450 | | | Citrix Systems, Inc.(2) | | | 39,600 | |
| 1,855 | | | Cognizant Technology Solutions Corp., Class A | | | 131,742 | |
| 513 | | | CSRA, Inc. | | | 15,349 | |
| 897 | | | DXC Technology Co. | | | 85,125 | |
| 3,056 | | | eBay, Inc.(2) | | | 115,333 | |
| 969 | | | Electronic Arts, Inc.(2) | | | 101,803 | |
| 7,502 | | | Facebook, Inc., Class A(2) | | | 1,323,803 | |
| 1,050 | | | Fidelity National Information Services, Inc. | | | 98,795 | |
| 656 | | | Fiserv, Inc.(2) | | | 86,021 | |
| 285 | | | Gartner, Inc.(2) | | | 35,098 | |
| 501 | | | Global Payments, Inc. | | | 50,220 | |
The accompanying Notes are an integral part of these financial statements.
|
HIMCO VIT Portfolio Diversifier Fund |
Schedule of Investments – (continued)
December 31, 2017
| | | | | | | | |
Shares or Principal Amount | | Market Value(1) | |
COMMON STOCKS - 25.1% - (continued) | |
| | | Software & Services - 3.6% - (continued) | | | |
| 2,709 | | | International Business Machines Corp. | | $ | 415,615 | |
| 764 | | | Intuit, Inc. | | | 120,544 | |
| 2,922 | | | MasterCard, Inc., Class A | | | 442,274 | |
| 24,270 | | | Microsoft Corp. | | | 2,076,056 | |
| 9,585 | | | Oracle Corp. | | | 453,179 | |
| 1,006 | | | Paychex, Inc. | | | 68,488 | |
| 3,554 | | | PayPal Holdings, Inc.(2) | | | 261,646 | |
| 557 | | | Red Hat, Inc.(2) | | | 66,896 | |
| 2,159 | | | salesforce.com, Inc.(2) | | | 220,715 | |
| 1,950 | | | Symantec Corp. | | | 54,717 | |
| 473 | | | Synopsys, Inc.(2) | | | 40,319 | |
| 526 | | | Total System Services, Inc. | | | 41,601 | |
| 267 | | | VeriSign, Inc.(2) | | | 30,555 | |
| 5,705 | | | Visa, Inc., Class A | | | 650,484 | |
| 1,445 | | | Western Union Co. (The) | | | 27,469 | |
| | | | | | | | |
| | | | | | | 10,173,771 | |
| | | | | | | | |
| | | Technology Hardware & Equipment - 1.4% | |
| 961 | | | Amphenol Corp., Class A | | | 84,376 | |
| 16,152 | | | Apple, Inc. | | | 2,733,403 | |
| 15,553 | | | Cisco Systems, Inc. | | | 595,680 | |
| 2,734 | | | Corning, Inc. | | | 87,461 | |
| 197 | | | F5 Networks, Inc.(2) | | | 25,850 | |
| 435 | | | FLIR Systems, Inc. | | | 20,280 | |
| 5,018 | | | Hewlett Packard Enterprise Co. | | | 72,058 | |
| 5,255 | | | HP, Inc. | | | 110,408 | |
| 1,180 | | | Juniper Networks, Inc. | | | 33,630 | |
| 510 | | | Motorola Solutions, Inc. | | | 46,073 | |
| 849 | | | NetApp, Inc. | | | 46,967 | |
| 910 | | | Seagate Technology plc | | | 38,074 | |
| 1,106 | | | TE Connectivity Ltd. | | | 105,114 | |
| 931 | | | Western Digital Corp. | | | 74,042 | |
| 671 | | | Xerox Corp. | | | 19,560 | |
| | | | | | | | |
| | | | | | | 4,092,976 | |
| | | | | | | | |
| | | Telecommunication Services - 0.5% | | | |
| 19,316 | | | AT&T, Inc. | | | 751,006 | |
| 3,060 | | | CenturyLink, Inc. | | | 51,041 | |
| 12,833 | | | Verizon Communications, Inc. | | | 679,251 | |
| | | | | | | | |
| | | | | | | 1,481,298 | |
| | | | | | | | |
| | | Transportation - 0.6% | | | |
| 387 | | | Alaska Air Group, Inc. | | | 28,448 | |
| 1,340 | | | American Airlines Group, Inc. | | | 69,720 | |
| 438 | | | CH Robinson Worldwide, Inc. | | | 39,021 | |
| 2,812 | | | CSX Corp. | | | 154,688 | |
| 2,064 | | | Delta Air Lines, Inc. | | | 115,584 | |
| 559 | | | Expeditors International of Washington, Inc. | | | 36,162 | |
| 776 | | | FedEx Corp. | | | 193,643 | |
| 269 | | | JB Hunt Transport Services, Inc. | | | 30,930 | |
| 326 | | | Kansas City Southern | | | 34,302 | |
| 900 | | | Norfolk Southern Corp. | | | 130,410 | |
| 1,717 | | | Southwest Airlines Co. | | | 112,378 | |
| 2,476 | | | Union Pacific Corp. | | | 332,031 | |
| 792 | | | United Continental Holdings, Inc.(2) | | | 53,381 | |
| 2,161 | | | United Parcel Service, Inc., Class B | | | 257,483 | |
| | | | | | | | |
| | | | | | | 1,588,181 | |
| | | | | | | | |
| | | Utilities - 0.7% | | | |
| 2,078 | | | AES Corp. | | | 22,505 | |
| 727 | | | Alliant Energy Corp. | | | 30,978 | |
| | | | | | | | |
Shares or Principal Amount | | Market Value(1) | |
COMMON STOCKS - 25.1% - (continued) | |
| | | Utilities - 0.7% - (continued) | | | |
| 763 | | | Ameren Corp. | | $ | 45,009 | |
| 1,547 | | | American Electric Power Co., Inc. | | | 113,813 | |
| 561 | | | American Water Works Co., Inc. | | | 51,326 | |
| 1,356 | | | CenterPoint Energy, Inc. | | | 38,456 | |
| 887 | | | CMS Energy Corp. | | | 41,955 | |
| 975 | | | Consolidated Edison, Inc. | | | 82,826 | |
| 2,024 | | | Dominion Energy, Inc. | | | 164,065 | |
| 564 | | | DTE Energy Co. | | | 61,735 | |
| 2,202 | | | Duke Energy Corp. | | | 185,210 | |
| 1,025 | | | Edison International | | | 64,821 | |
| 567 | | | Entergy Corp. | | | 46,148 | |
| 997 | | | Eversource Energy | | | 62,990 | |
| 3,021 | | | Exelon Corp. | | | 119,058 | |
| 1,400 | | | FirstEnergy Corp. | | | 42,868 | |
| 1,480 | | | NextEra Energy, Inc. | | | 231,161 | |
| 1,059 | | | NiSource, Inc. | | | 27,185 | |
| 946 | | | NRG Energy, Inc. | | | 26,942 | |
| 1,613 | | | PG&E Corp. | | | 72,311 | |
| 351 | | | Pinnacle West Capital Corp. | | | 29,898 | |
| 2,150 | | | PPL Corp. | | | 66,543 | |
| 1,592 | | | Public Service Enterprise Group, Inc. | | | 81,988 | |
| 447 | | | SCANA Corp. | | | 17,782 | |
| 790 | | | Sempra Energy | | | 84,467 | |
| 3,157 | | | Southern Co. (The) | | | 151,820 | |
| 993 | | | WEC Energy Group, Inc. | | | 65,965 | |
| 1,597 | | | Xcel Energy, Inc. | | | 76,832 | |
| | | | | | | | |
| | | | | | | 2,106,657 | |
| | | | | | | | |
| | |
| | | | Total Common Stocks (cost $50,224,139) | | | 71,741,784 | |
| | | | | | | | |
|
EXCHANGE-TRADED FUNDS - 0.3% | |
| | | Diversified Financial Services - 0.3% | | | |
| 3,635 | | | Vanguard S&P 500 ETF (cost $893,997) | | | 891,629 | |
| | | | | | | | |
| | |
| | | | Total Exchange-Traded Funds (cost $893,997) | | | 891,629 | |
| | | | | | | | |
|
ASSET & COMMERCIAL MORTGAGE BACKED SECURITIES - 0.3% | |
| | | | Chase Issuance Trust, | | | | |
| | | | Series 2013-A1, Class A1 | | | | |
$ | 100,000 | | | 1.30%, 02/18/2020 | | | 99,944 | |
| | | | Citigroup Commercial Mortgage Trust, | | | | |
| | | | Series 2014-GC23, Class A4 | | | | |
| 50,000 | | | 3.62%, 07/10/2047 | | | 52,075 | |
| | | | COMM Mortgage Trust | | | | |
| | | | Series 2013-CR9, Class A4, | | | | |
| 35,000 | | | 4.23%, 07/10/2045(4) | | | 37,490 | |
| | | | Series 2014-UBS5, Class A4 | | | | |
| 45,000 | | | 3.84%, 09/10/2047 | | | 47,310 | |
| | | | Series 2014-UBS6, Class A5 | | | | |
| 50,000 | | | 3.64%, 12/10/2047 | | | 51,956 | |
| | | | Series 2015-LC23, Class A4 | | | | |
| 35,000 | | | 3.77%, 10/10/2048 | | | 36,702 | |
| | | | Commercial Mortgage Pass-Through Certificates, | | | | |
| | | | Series 2012-CR2, Class A4 | | | | |
| 30,000 | | | 3.15%, 08/15/2045 | | | 30,457 | |
The accompanying Notes are an integral part of these financial statements.
|
HIMCO VIT Portfolio Diversifier Fund |
Schedule of Investments – (continued)
December 31, 2017
| | | | | | | | |
Shares or Principal Amount | | Market Value(1) | |
ASSET & COMMERCIAL MORTGAGE BACKED SECURITIES - 0.3% - (continued) | |
| | | | Commercial Mortgage Trust, | | | | |
| | | | Series 2013-LC6, Class A4 | | | | |
$ | 15,000 | | | 2.94%, 01/10/2046 | | $ | 15,107 | |
| | | | CSAIL Commercial Mortgage Trust, | | | | |
| | | | Series 2015-C4, Class A4 | | | | |
| 35,000 | | | 3.81%, 11/15/2048 | | | 36,590 | |
| | | | GS Mortgage Securities Corp. II, | | | | |
| | | | Series 2013-GC10, Class A5 | | | | |
| 10,000 | | | 2.94%, 02/10/2046 | | | 10,082 | |
| | | | GS Mortgage Securities Trust | | | | |
| | | | Series 2012-GC6, Class A3 | | | | |
| 19,925 | | | 3.48%, 01/10/2045 | | | 20,499 | |
| | | | Series 2012-GCJ7, Class A4 | | | | |
| 47,432 | | | 3.38%, 05/10/2045 | | | 48,518 | |
| | | | Series 2013-GC12, Class A4 | | | | |
| 40,000 | | | 3.14%, 06/10/2046 | | | 40,645 | |
| | | | Series 2013-GC14, Class A5 | | | | |
| 35,000 | | | 4.24%, 08/10/2046 | | | 37,487 | |
| | | | Series 2013-GC16, Class A4 | | | | |
| 40,000 | | | 4.27%, 11/10/2046 | | | 42,952 | |
| | | | Series 2014-GC18, Class A4 | | | | |
| 40,000 | | | 4.07%, 01/10/2047 | | | 42,455 | |
| | | | Series 2015-GS1, Class A3 | | | | |
| 30,000 | | | 3.73%, 11/10/2048 | | | 31,427 | |
| | | | JP Morgan Chase Commercial Mortgage Securities Trust, | | | | |
| | | | Series 2011-C5, Class A3 | | | | |
| 8,206 | | | 4.17%, 08/15/2046 | | | 8,596 | |
| | | | JPMBB Commercial Mortgage Securities Trust, | | | | |
| | | | Series 2014-C22, Class A4 | | | | |
| 40,000 | | | 3.80%, 09/15/2047 | | | 41,921 | |
| | | | Morgan Stanley Bank of America Merrill Lynch Trust | | | | |
| | | | Series 2014-C15, Class A4 | | | | |
| 40,000 | | | 4.05%, 04/15/2047 | | | 42,471 | |
| | | | Series 2014-C16, Class A5 | | | | |
| 50,000 | | | 3.89%, 06/15/2047 | | | 52,645 | |
| | | | Series 2015-C22, Class A4 | | | | |
| 30,000 | | | 3.31%, 04/15/2048 | | | 30,581 | |
| | | | Series 2015-C27, Class A4 | | | | |
| 30,000 | | | 3.75%, 12/15/2047 | | | 31,464 | |
| | | | WF-RBS Commercial Mortgage Trust, | | | | |
| | | | Series 2012-C10, Class A3 | | | | |
| 40,000 | | | 2.88%, 12/15/2045 | | | 40,151 | |
| | | | | | | | |
| | |
| | | | Total Asset & Commercial Mortgage Backed Securities (cost $932,327) | | | 929,525 | |
| | | | | | | | |
|
CORPORATE BONDS - 14.5% | |
| | | Advertising - 0.0% | | | |
| | | | Omnicom Group, Inc. | | | | |
| 40,000 | | | 3.63%, 05/01/2022 | | | 41,294 | |
| | | | | | | | |
| | | Aerospace/Defense - 0.3% | | | |
| | | | Boeing Co. (The) | | | | |
| 230,000 | | | 4.88%, 02/15/2020 | | | 242,929 | |
| 35,000 | | | 6.13%, 02/15/2033 | | | 46,688 | |
| | | | General Dynamics Corp. | | | | |
| 15,000 | | | 3.88%, 07/15/2021 | | | 15,746 | |
| | | | | | | | |
Shares or Principal Amount | | Market Value(1) | |
CORPORATE BONDS - 14.5% - (continued) | |
| | | Aerospace/Defense - 0.3% - (continued) | | | |
| | | | Lockheed Martin Corp. | | | | |
$ | 86,000 | | | 4.09%, 09/15/2052 | | $ | 90,025 | |
| 140,000 | | | 4.25%, 11/15/2019 | | | 145,326 | |
| | | | Northrop Grumman Corp. | | | | |
| 70,000 | | | 4.75%, 06/01/2043 | | | 80,846 | |
| 20,000 | | | 5.05%, 08/01/2019 | | | 20,898 | |
| | | | Raytheon Co. | | | | |
| 95,000 | | | 3.13%, 10/15/2020 | | | 97,183 | |
| | | | United Technologies Corp. | | | | |
| 65,000 | | | 4.50%, 04/15/2020 | | | 68,186 | |
| 100,000 | | | 4.50%, 06/01/2042 | | | 110,837 | |
| | | | | | | | |
| | | | | | | 918,664 | |
| | | | | | | | |
| | | Agriculture - 0.2% | | | |
| | | | Altria Group, Inc. | | | | |
| 300,000 | | | 4.75%, 05/05/2021 | | | 321,714 | |
| | | | Archer-Daniels-Midland Co. | | | | |
| 33,000 | | | 4.02%, 04/16/2043 | | | 34,916 | |
| | | | Philip Morris International, Inc. | | | | |
| 105,000 | | | 4.50%, 03/26/2020 | | | 109,896 | |
| 75,000 | | | 4.50%, 03/20/2042 | | | 81,616 | |
| | | | Reynolds American, Inc. | | | | |
| 90,000 | | | 4.45%, 06/12/2025 | | | 95,962 | |
| | | | | | | | |
| | | | | | | 644,104 | |
| | | | | | | | |
| | | Auto Manufacturers - 0.2% | | | |
| | | | Daimler Finance North America LLC | | | | |
| 18,000 | | | 8.50%, 01/18/2031 | | | 27,192 | |
| | | | Ford Motor Co. | | | | |
| 175,000 | | | 7.45%, 07/16/2031 | | | 228,762 | |
| | | | General Motors Co. | | | | |
| 120,000 | | | 6.25%, 10/02/2043 | | | 142,136 | |
| | | | Toyota Motor Credit Corp., MTN | | | | |
| 190,000 | | | 3.40%, 09/15/2021 | | | 196,600 | |
| | | | | | | | |
| | | | | | | 594,690 | |
| | | | | | | | |
| | | Beverages - 0.4% | | | |
| | | | Anheuser-Busch InBev Finance, Inc. | | | | |
| 395,000 | | | 3.65%, 02/01/2026 | | | 407,631 | |
| | | | Anheuser-Busch InBev Worldwide, Inc. | | | | |
| 110,000 | | | 3.75%, 07/15/2042 | | | 106,982 | |
| 125,000 | | | 5.38%, 01/15/2020 | | | 132,601 | |
| | | | Coca-Cola Co. (The) | | | | |
| 210,000 | | | 3.15%, 11/15/2020 | | | 215,729 | |
| | | | Diageo Capital plc | | | | |
| 25,000 | | | 3.88%, 04/29/2043 | | | 26,162 | |
| | | | Molson Coors Brewing Co. | | | | |
| 65,000 | | | 4.20%, 07/15/2046 | | | 66,237 | |
| | | | PepsiCo, Inc. | | | | |
| 60,000 | | | 3.13%, 11/01/2020 | | | 61,567 | |
| 85,000 | | | 5.50%, 01/15/2040 | | | 109,002 | |
| | | | | | | | |
| | | | | | | 1,125,911 | |
| | | | | | | | |
| | | Biotechnology - 0.2% | | | |
| | | | Amgen, Inc. | | | | |
| 105,000 | | | 3.88%, 11/15/2021 | | | 109,745 | |
| 25,000 | | | 4.40%, 05/01/2045 | | | 27,201 | |
| 68,000 | | | 4.66%, 06/15/2051 | | | 76,058 | |
| | | | Celgene Corp. | | | | |
| 160,000 | | | 3.25%, 08/15/2022 | | | 162,533 | |
The accompanying Notes are an integral part of these financial statements.
|
HIMCO VIT Portfolio Diversifier Fund |
Schedule of Investments – (continued)
December 31, 2017
| | | | | | | | |
Shares or Principal Amount | | Market Value(1) | |
CORPORATE BONDS - 14.5% - (continued) | |
| | | Biotechnology - 0.2% - (continued) | | | |
| | | | Gilead Sciences, Inc. | | | | |
$ | 230,000 | | | 3.70%, 04/01/2024 | | $ | 240,623 | |
| 20,000 | | | 4.40%, 12/01/2021 | | | 21,331 | |
| 45,000 | | | 4.80%, 04/01/2044 | | | 52,215 | |
| | | | | | | | |
| | | | | | | 689,706 | |
| | | | | | | | |
| | | Chemicals - 0.3% | | | |
| | | | Dow Chemical Co. (The) | | | | |
| 200,000 | | | 4.13%, 11/15/2021 | | | 209,706 | |
| 50,000 | | | 4.38%, 11/15/2042 | | | 52,608 | |
| | | | Eastman Chemical Co. | | | | |
| 68,000 | | | 3.80%, 03/15/2025 | | | 70,896 | |
| | | | Ecolab, Inc. | | | | |
| 37,000 | | | 4.35%, 12/08/2021 | | | 39,383 | |
| | | | EI du Pont de Nemours & Co. | | | | |
| 20,000 | | | 5.60%, 12/15/2036 | | | 24,301 | |
| | | | LYB International Finance BV | | | | |
| 130,000 | | | 4.00%, 07/15/2023 | | | 136,082 | |
| 30,000 | | | 4.88%, 03/15/2044 | | | 33,298 | |
| | | | Monsanto Co. | | | | |
| 80,000 | | | 4.40%, 07/15/2044 | | | 85,244 | |
| | | | Potash Corp. of Saskatchewan, Inc. | | | | |
| 35,000 | | | 6.50%, 05/15/2019 | | | 36,804 | |
| | | | PPG Industries, Inc. | | | | |
| 20,000 | | | 3.60%, 11/15/2020 | | | 20,512 | |
| | | | Praxair, Inc. | | | | |
| 55,000 | | | 2.45%, 02/15/2022 | | | 55,087 | |
| | | | | | | | |
| | | | | | | 763,921 | |
| | | | | | | | |
| | | Commercial Banks - 3.1% | | | |
| | | | Bank of America Corp. | | | | |
| 250,000 | | | 3.30%, 01/11/2023 | | | 255,750 | |
| 483,000 | | | (3 mo. LIBOR + 1.04%) 3.42%, 12/20/2028(4)(5) | | | 483,104 | |
| 60,000 | | | 5.88%, 02/07/2042 | | | 79,450 | |
| | | | Bank of New York Mellon Corp. (The) | | | | |
| 150,000 | | | 3.55%, 09/23/2021 | | | 155,633 | |
| | | | Bank of Nova Scotia | | | | |
| 95,000 | | | 4.38%, 01/13/2021 | | | 100,243 | |
| | | | Barclays PLC | | | | |
| 270,000 | | | 2.88%, 06/08/2020 | | | 270,821 | |
| | | | BB&T Corp. | | | | |
| 130,000 | | | 5.25%, 11/01/2019 | | | 136,699 | |
| | | | Capital One Financial Corp. | | | | |
| 140,000 | | | 4.75%, 07/15/2021 | | | 149,587 | |
| | | | Citigroup, Inc. | | | | |
| 210,000 | | | 2.65%, 10/26/2020 | | | 210,703 | |
| 320,000 | | | 6.63%, 06/15/2032 | | | 407,785 | |
| | | | Cooperatieve Rabobank UA | | | | |
| 195,000 | | | 4.50%, 01/11/2021 | | | 206,690 | |
| 65,000 | | | 5.25%, 05/24/2041 | | | 81,971 | |
| | | | Credit Suisse | | | | |
| 650,000 | | | 5.30%, 08/13/2019 | | | 680,700 | |
| | | | Deutsche Bank AG | | | | |
| 70,000 | | | 3.70%, 05/30/2024 | | | 70,470 | |
| | | | Fifth Third Bancorp | | | | |
| 100,000 | | | 3.50%, 03/15/2022 | | | 102,949 | |
| | | | Goldman Sachs Group, Inc. (The) | | | | |
| 525,000 | | | 3.85%, 07/08/2024 | | | 544,565 | |
| 30,000 | | | 4.75%, 10/21/2045 | | | 34,365 | |
| 89,000 | | | 6.25%, 02/01/2041 | | | 119,936 | |
| | | | | | | | |
Shares or Principal Amount | | Market Value(1) | |
CORPORATE BONDS - 14.5% - (continued) | |
| | | Commercial Banks - 3.1% - (continued) | | | |
| | | | HSBC Holdings plc | | | | |
$ | 650,000 | | | 5.10%, 04/05/2021 | | $ | 698,379 | |
| | | | HSBC USA, Inc. | | | | |
| 110,000 | | | 3.50%, 06/23/2024 | | | 112,953 | |
| | | | JPMorgan Chase & Co. | | | | |
| 455,000 | | | 4.95%, 03/25/2020 | | | 480,735 | |
| 260,000 | | | 5.50%, 10/15/2040 | | | 327,439 | |
| 155,000 | | | 6.30%, 04/23/2019 | | | 163,184 | |
| | | | Morgan Stanley | | | | |
| 90,000 | | | 4.30%, 01/27/2045 | | | 97,072 | |
| 655,000 | | | 5.50%, 07/28/2021 | | | 716,464 | |
| | | | PNC Financial Services Group, Inc. (The) | | | | |
| 170,000 | | | 3.30%, 03/08/2022 | | | 174,546 | |
| 150,000 | | | 5.13%, 02/08/2020 | | | 158,312 | |
| | | | Royal Bank of Canada | | | | |
| 60,000 | | | 4.65%, 01/27/2026 | | | 64,657 | |
| | | | State Street Corp. | | | | |
| 80,000 | | | 4.38%, 03/07/2021 | | | 84,869 | |
| | | | Sumitomo Mitsui Financial Group, Inc. | | | | |
| 300,000 | | | 2.93%, 03/09/2021 | | | 302,841 | |
| | | | Toronto-Dominion Bank (The) | | | | |
| 300,000 | | | 2.25%, 11/05/2019 | | | 300,181 | |
| | | | US Bancorp | | | | |
| 180,000 | | | 4.13%, 05/24/2021 | | | 189,751 | |
| | | | Wells Fargo & Co. | | | | |
| 200,000 | | | 3.50%, 03/08/2022 | | | 206,512 | |
| 270,000 | | | 4.60%, 04/01/2021 | | | 286,930 | |
| 180,000 | | | 5.61%, 01/15/2044 | | | 221,921 | |
| | | | Westpac Banking Corp. | | | | |
| 250,000 | | | 4.88%, 11/19/2019 | | | 262,078 | |
| | | | | | | | |
| | | | | | | 8,940,245 | |
| | | | | | | | |
| | | Commercial Services - 0.0% | | | |
| | | | Princeton University | | | | |
| 75,000 | | | 4.95%, 03/01/2019 | | | 77,418 | |
| | | | | | | | |
| | | Construction Materials - 0.0% | | | |
| | | | Johnson Controls International plc | | | | |
| 100,000 | | | 5.00%, 03/30/2020 | | | 105,472 | |
| | | | | | | | |
| | | Diversified Financial Services - 0.4% | | | |
| | | | American Express Co. | | | | |
| 148,000 | | | 2.65%, 12/02/2022 | | | 146,970 | |
| | | | BlackRock, Inc. | | | | |
| 105,000 | | | 5.00%, 12/10/2019 | | | 110,418 | |
| | | | GE Capital International Funding Co. | | | | |
| 468,000 | | | 2.34%, 11/15/2020 | | | 465,842 | |
| | | | General Electric Capital Corp. | | | | |
| 100,000 | | | 5.88%, 01/14/2038 | | | 129,319 | |
| | | | HSBC Finance Corp. | | | | |
| 24,000 | | | 6.68%, 01/15/2021 | | | 26,683 | |
| | | | National Rural Utilities Cooperative Finance Corp. | | | | |
| 110,000 | | | 3.05%, 02/15/2022 | | | 111,906 | |
| | | | | | | | |
| | | | | | | 991,138 | |
| | | | | | | | |
| | | Electric - 0.9% | | | |
| | | | Alabama Power Co. | | | | |
| 107,000 | | | 6.00%, 03/01/2039 | | | 140,414 | |
| | | | Berkshire Hathaway Energy Co. | | | | |
| 132,000 | | | 6.13%, 04/01/2036 | | | 176,421 | |
| | | | CenterPoint Energy Houston Electric LLC | | | | |
| 15,000 | | | 3.55%, 08/01/2042 | | | 14,956 | |
The accompanying Notes are an integral part of these financial statements.
|
HIMCO VIT Portfolio Diversifier Fund |
Schedule of Investments – (continued)
December 31, 2017
| | | | | | | | |
Shares or Principal Amount | | Market Value(1) | |
CORPORATE BONDS - 14.5% - (continued) | |
| | | Electric - 0.9% - (continued) | | | |
| | | | CMS Energy Corp. | | | | |
$ | 60,000 | | | 5.05%, 03/15/2022 | | $ | 65,228 | |
| | | | Commonwealth Edison Co. | | | | |
| 40,000 | | | 3.80%, 10/01/2042 | | | 41,457 | |
| | | | Consolidated Edison Co. of New York, Inc. | | | | |
| 80,000 | | | 3.95%, 03/01/2043 | | | 84,244 | |
| 40,000 | | | 6.65%, 04/01/2019 | | | 42,130 | |
| | | | Dominion Energy, Inc. | | | | |
| 140,000 | | | 4.45%, 03/15/2021 | | | 147,830 | |
| | | | Series C | | | | |
| 75,000 | | | 4.90%, 08/01/2041 | | | 86,670 | |
| | | | Duke Energy Carolinas LLC | | | | |
| 90,000 | | | 4.00%, 09/30/2042 | | | 96,022 | |
| 30,000 | | | 5.30%, 02/15/2040 | | | 37,712 | |
| | | | Entergy Louisiana LLC | | | | |
| 100,000 | | | 4.05%, 09/01/2023 | | | 105,996 | |
| | | | Exelon Generation Co. LLC | | | | |
| 75,000 | | | 4.00%, 10/01/2020 | | | 77,289 | |
| 135,000 | | | 6.25%, 10/01/2039 | | | 157,925 | |
| | | | Florida Power & Light Co. | | | | |
| 85,000 | | | 5.69%, 03/01/2040 | | | 112,863 | |
| | | | Georgia Power Co. | | | | |
| 100,000 | | | 2.85%, 05/15/2022 | | | 100,159 | |
| | | | Indiana Michigan Power Co. | | | | |
| 25,000 | | | 6.05%, 03/15/2037 | | | 32,393 | |
| | | | Kentucky Utilities Co. | | | | |
| 70,000 | | | 5.13%, 11/01/2040 | | | 86,371 | |
| | | | Nevada Power Co., Series R | | | | |
| 55,000 | | | 6.75%, 07/01/2037 | | | 77,801 | |
| | | | NiSource Finance Corp. | | | | |
| 40,000 | | | 5.25%, 02/15/2043 | | | 47,898 | |
| | | | Northern States Power Co. | | | | |
| 80,000 | | | 3.40%, 08/15/2042 | | | 79,175 | |
| | | | Ohio Power Co., Series M | | | | |
| 75,000 | | | 5.38%, 10/01/2021 | | | 82,455 | |
| | | | Oncor Electric Delivery Co. LLC | | | | |
| 95,000 | | | 7.00%, 09/01/2022 | | | 112,254 | |
| | | | Pacific Gas & Electric Co. | | | | |
| 135,000 | | | 6.05%, 03/01/2034 | | | 170,159 | |
| | | | Progress Energy, Inc. | | | | |
| 140,000 | | | 3.15%, 04/01/2022 | | | 141,807 | |
| 130,000 | | | 4.40%, 01/15/2021 | | | 136,272 | |
| | | | PSEG Power LLC | | | | |
| 25,000 | | | 5.13%, 04/15/2020 | | | 26,426 | |
| | | | Public Service Electric & Gas Co. | | | | |
| 65,000 | | | 3.95%, 05/01/2042 | | | 69,524 | |
| | | | Southern California Edison Co. | | | | |
| 75,000 | | | 4.50%, 09/01/2040 | | | 84,488 | |
| | | | Xcel Energy, Inc. | | | | |
| 65,000 | | | 4.70%, 05/15/2020 | | | 67,761 | |
| | | | | | | | |
| | | | | | | 2,702,100 | |
| | | | | | | | |
| | | Electrical Components & Equipment - 0.0% | |
| | | | Emerson Electric Co. | | | | |
| 70,000 | | | 4.88%, 10/15/2019 | | | 73,163 | |
| | | | | | | | |
| | | Electronics - 0.1% | | | |
| | | | Honeywell International, Inc. | | | | |
| 20,000 | | | 3.81%, 11/21/2047(5) | | | 20,797 | |
| 80,000 | | | 4.25%, 03/01/2021 | | | 84,506 | |
| | | | | | | | |
Shares or Principal Amount | | Market Value(1) | |
CORPORATE BONDS - 14.5% - (continued) | |
| | | Electronics - 0.1% - (continued) | | | |
| | | | Thermo Fisher Scientific, Inc. | | | | |
$ | 150,000 | | | 4.15%, 02/01/2024 | | $ | 159,113 | |
| | | | | | | | |
| | | | | | | 264,416 | |
| | | | | | | | |
| | | Environmental Control - 0.1% | | | |
| | | | Republic Services, Inc. | | | | |
| 95,000 | | | 5.00%, 03/01/2020 | | | 100,081 | |
| | | | Waste Management, Inc. | | | | |
| 105,000 | | | 4.75%, 06/30/2020 | | | 111,137 | |
| | | | | | | | |
| | | | | | | 211,218 | |
| | | | | | | | |
| | | Food - 0.2% | | | |
| | | | General Mills, Inc. | | | | |
| 80,000 | | | 5.65%, 02/15/2019 | | | 83,019 | |
| | | | JM Smucker Co. (The) | | | | |
| 70,000 | | | 3.50%, 03/15/2025 | | | 71,511 | |
| | | | Kellogg Co. | | | | |
| 45,000 | | | 4.00%, 12/15/2020 | | | 47,131 | |
| | | | Kraft Heinz Foods Co. | | | | |
| 100,000 | | | 5.00%, 06/04/2042 | | | 107,302 | |
| 183,000 | | | 5.38%, 02/10/2020 | | | 193,888 | |
| | | | Kroger Co. (The) | | | | |
| 40,000 | | | 7.50%, 04/01/2031 | | | 52,716 | |
| | | | Tyson Foods, Inc. | | | | |
| 50,000 | | | 3.95%, 08/15/2024 | | | 52,584 | |
| | | | Unilever Capital Corp. | | | | |
| 50,000 | | | 5.90%, 11/15/2032 | | | 65,106 | |
| | | | | | | | |
| | | | | | | 673,257 | |
| | | | | | | | |
| | | Forest Products & Paper - 0.1% | | | |
| | | | Georgia-Pacific LLC | | | | |
| 10,000 | | | 7.75%, 11/15/2029 | | | 14,056 | |
| | | | International Paper Co. | | | | |
| 200,000 | | | 3.80%, 01/15/2026 | | | 207,210 | |
| | | | | | | | |
| | | | | | | 221,266 | |
| | | | | | | | |
| | | Gas - 0.0% | | | |
| | | | Atmos Energy Corp. | | | | |
| 8,000 | | | 5.50%, 06/15/2041 | | | 10,093 | |
| | | | Sempra Energy | | | | |
| 65,000 | | | 6.00%, 10/15/2039 | | | 83,871 | |
| | | | | | | | |
| | | | | | | 93,964 | |
| | | | | | | | |
| | | Healthcare-Products - 0.3% | | | |
| | | | Abbott Laboratories | | | | |
| 100,000 | | | 2.90%, 11/30/2021 | | | 101,158 | |
| 70,000 | | | 2.95%, 03/15/2025 | | | 68,677 | |
| 100,000 | | | 4.75%, 11/30/2036 | | | 112,360 | |
| | | | Becton Dickinson and Co. | | | | |
| 35,000 | | | 4.69%, 12/15/2044 | | | 38,272 | |
| | | | Boston Scientific Corp. | | | | |
| 70,000 | | | 6.00%, 01/15/2020 | | | 74,718 | |
| | | | Covidien International Finance S.A. | | | | |
| 45,000 | | | 3.20%, 06/15/2022 | | | 45,994 | |
| | | | Medtronic, Inc. | | | | |
| 225,000 | | | 3.50%, 03/15/2025 | | | 233,403 | |
| | | | Zimmer Biomet Holdings, Inc. | | | | |
| 60,000 | | | 3.55%, 04/01/2025 | | | 59,960 | |
| | | | | | | | |
| | | | | | | 734,542 | |
| | | | | | | | |
| | | Healthcare-Services - 0.2% | | | |
| | | | Anthem, Inc. | | | | |
| 90,000 | | | 4.65%, 01/15/2043 | | | 98,687 | |
The accompanying Notes are an integral part of these financial statements.
|
HIMCO VIT Portfolio Diversifier Fund |
Schedule of Investments – (continued)
December 31, 2017
| | | | | | | | |
Shares or Principal Amount | | Market Value(1) | |
CORPORATE BONDS - 14.5% - (continued) | |
| | | Healthcare-Services - 0.2% - (continued) | | | |
| | | | Cigna Corp. | | | | |
$ | 50,000 | | | 4.00%, 02/15/2022 | | $ | 52,218 | |
| | | | Quest Diagnostics, Inc. | | | | |
| 110,000 | | | 4.70%, 04/01/2021 | | | 116,304 | |
| | | | UnitedHealth Group, Inc. | | | | |
| 125,000 | | | 6.88%, 02/15/2038 | | | 181,303 | |
| | | | | | | | |
| | | | | | | 448,512 | |
| | | | | | | | |
| | | Household Products - 0.1% | | | |
| | | | Colgate-Palmolive Co. | | | | |
| 90,000 | | | 2.30%, 05/03/2022 | | | 89,407 | |
| | | | Procter & Gamble Co. (The) | | | | |
| 57,000 | | | 5.55%, 03/05/2037 | | | 75,918 | |
| | | | | | | | |
| | | | | | | 165,325 | |
| | | | | | | | |
| | | Household Products/Wares - 0.0% | | | |
| | | | Kimberly-Clark Corp. | | | | |
| 12,000 | | | 5.30%, 03/01/2041 | | | 15,141 | |
| | | | | | | | |
| | | Insurance - 0.5% | | | |
| | | | Allstate Corp. (The) | | | | |
| 45,000 | | | 5.55%, 05/09/2035 | | | 55,497 | |
| | | | American International Group, Inc. | | | | |
| 110,000 | | | 4.50%, 07/16/2044 | | | 118,481 | |
| | | | Aon Corp. | | | | |
| 20,000 | | | 5.00%, 09/30/2020 | | | 21,298 | |
| | | | Aon plc | | | | |
| 60,000 | | | 4.75%, 05/15/2045 | | | 66,714 | |
| | | | Berkshire Hathaway, Inc. | | | | |
| 75,000 | | | 4.50%, 02/11/2043 | | | 86,429 | |
| | | | Chubb INA Holdings, Inc. | | | | |
| 165,000 | | | 2.70%, 03/13/2023 | | | 163,916 | |
| 75,000 | | | 2.88%, 11/03/2022 | | | 76,021 | |
| | | | Lincoln National Corp. | | | | |
| 60,000 | | | 4.00%, 09/01/2023 | | | 62,635 | |
| | | | Marsh & McLennan Cos., Inc. | | | | |
| 35,000 | | | 4.80%, 07/15/2021 | | | 37,419 | |
| | | | MetLife, Inc. | | | | |
| 25,000 | | | 4.88%, 11/13/2043 | | | 29,337 | |
| 90,000 | | | 5.70%, 06/15/2035 | | | 114,009 | |
| 120,000 | | | 7.72%, 02/15/2019 | | | 127,503 | |
| | | | Principal Financial Group, Inc. | | | | |
| 70,000 | | | 3.30%, 09/15/2022 | | | 71,200 | |
| | | | Prudential Financial, Inc. | | | | |
| 85,000 | | | 3.94%, 12/07/2049(5) | | | 86,905 | |
| 145,000 | | | 5.38%, 06/21/2020 | | | 155,267 | |
| | | | Travelers Cos., Inc. (The) | | | | |
| 70,000 | | | 4.60%, 08/01/2043 | | | 80,819 | |
| | | | | | | | |
| | | | | | | 1,353,450 | |
| | | | | | | | |
| | | Internet - 0.1% | | | |
| | | | Amazon.com, Inc. | | | | |
| 240,000 | | | 3.15%, 08/22/2027(5) | | | 240,362 | |
| | | | | | | | |
| | | Iron/Steel - 0.0% | | | |
| | | | Vale Overseas Ltd. | | | | |
| 90,000 | | | 6.88%, 11/10/2039 | | | 110,362 | |
| | | | | | | | |
| | | IT Services - 0.4% | | | |
| | | | Apple, Inc. | | | | |
| 425,000 | | | 2.40%, 05/03/2023 | | | 420,627 | |
| 190,000 | | | 3.45%, 02/09/2045 | | | 185,426 | |
| | | | Dell International LLC/EMC Corp. | | | | |
| 240,000 | | | 5.45%, 06/15/2023(5) | | | 259,353 | |
| | | | | | | | |
Shares or Principal Amount | | Market Value(1) | |
CORPORATE BONDS - 14.5% - (continued) | |
| | | IT Services - 0.4% - (continued) | | | |
| | | | Hewlett Packard Enterprise Co. | | | | |
$ | 170,000 | | | 4.40%, 10/15/2022 | | $ | 178,654 | |
| | | | HP, Inc. | | | | |
| 45,000 | | | 4.30%, 06/01/2021 | | | 47,180 | |
| | | | International Business Machines Corp. | | | | |
| 105,000 | | | 5.60%, 11/30/2039 | | | 137,195 | |
| | | | | | | | |
| | | | | | | 1,228,435 | |
| | | | | | | | |
| | | Machinery-Construction & Mining - 0.1% | |
| | | | Caterpillar, Inc. | | | | |
| 40,000 | | | 3.80%, 08/15/2042 | | | 42,860 | |
| 185,000 | | | 3.90%, 05/27/2021 | | | 194,551 | |
| | | | | | | | |
| | | | | | | 237,411 | |
| | | | | | | | |
| | | Machinery-Diversified - 0.0% | | | |
| | | | Deere & Co. | | | | |
| 55,000 | | | 3.90%, 06/09/2042 | | | 59,516 | |
| | | | | | | | |
| | | Media - 0.6% | | | |
| | | | 21st Century Fox America, Inc. | | | | |
| 131,000 | | | 6.40%, 12/15/2035 | | | 174,093 | |
| | | CBS Corp. | | | |
| 90,000 | | | 3.70%, 08/15/2024 | | | 92,608 | |
| | | | Charter Communications Operating LLC/Charter Communications Operating Capital | | | | |
| 140,000 | | | 4.91%, 07/23/2025 | | | 148,846 | |
| | | | Comcast Corp. | | | | |
| 150,000 | | | 4.65%, 07/15/2042 | | | 168,846 | |
| 105,000 | | | 5.15%, 03/01/2020 | | | 111,281 | |
| 90,000 | | | 7.05%, 03/15/2033 | | | 125,224 | |
| | | | Discovery Communications LLC | | | | |
| 60,000 | | | 4.88%, 04/01/2043 | | | 59,585 | |
| | | | Time Warner Cable LLC | | | | |
| 245,000 | | | 4.00%, 09/01/2021 | | | 252,335 | |
| 40,000 | | | 4.50%, 09/15/2042 | | | 37,529 | |
| | | | Time Warner, Inc. | | | | |
| 140,000 | | | 3.80%, 02/15/2027 | | | 139,868 | |
| 60,000 | | | 4.85%, 07/15/2045 | | | 63,014 | |
| | | | Viacom, Inc. | | | | |
| 98,000 | | | 4.38%, 03/15/2043 | | | 84,837 | |
| | | | Walt Disney Co. (The) | | | | |
| 60,000 | | | 2.55%, 02/15/2022 | | | 60,316 | |
| | | | Series E | | | | |
| 55,000 | | | 4.13%, 12/01/2041 | | | 59,213 | |
| | | | | | | | |
| | | | | | | 1,577,595 | |
| | | | | | | | |
| | | Mining - 0.1% | | | |
| | | | Barrick Gold Corp. | | | | |
| 45,000 | | | 5.25%, 04/01/2042 | | | 51,880 | |
| | | | BHP Billiton Finance USA Ltd. | | | | |
| 40,000 | | | 2.88%, 02/24/2022 | | | 40,462 | |
| 15,000 | | | 4.13%, 02/24/2042 | | | 16,152 | |
| | | | Newmont Mining Corp. | | | | |
| 50,000 | | | 6.25%, 10/01/2039 | | | 63,937 | |
| | | | Rio Tinto Finance USA Ltd. | | | | |
| 50,000 | | | 5.20%, 11/02/2040 | | | 61,403 | |
| | | | Southern Copper Corp. | | | | |
| 55,000 | | | 6.75%, 04/16/2040 | | | 71,705 | |
| | | | | | | | |
| | | | | | | 305,539 | |
| | | | | | | | |
The accompanying Notes are an integral part of these financial statements.
|
HIMCO VIT Portfolio Diversifier Fund |
Schedule of Investments – (continued)
December 31, 2017
| | | | | | | | |
Shares or Principal Amount | | Market Value(1) | |
CORPORATE BONDS - 14.5% - (continued) | |
| | | Miscellaneous Manufacturer - 0.2% | | | |
| | | | 3M Co. | | | | |
$ | 90,000 | | | 2.88%, 10/15/2027 | | $ | 89,518 | |
| | | | Eaton Corp. | | | | |
| 115,000 | | | 2.75%, 11/02/2022 | | | 115,336 | |
| | | | General Electric Co. | | | | |
| 67,000 | | | 4.13%, 10/09/2042 | | | 70,189 | |
| | | | Illinois Tool Works, Inc. | | | | |
| 35,000 | | | 3.90%, 09/01/2042 | | | 37,509 | |
| | | | Newell Brands, Inc. | | | | |
| 150,000 | | | 4.20%, 04/01/2026 | | | 156,661 | |
| | | | | | | | |
| | | | | | | 469,213 | |
| | | | | | | | |
| | | Multi-National - 0.8% | | | |
| | | | Asian Development Bank | | | | |
| 90,000 | | | 2.00%, 01/22/2025 | | | 87,213 | |
| | | | European Bank for Reconstruction & Development | | | | |
| 150,000 | | | 1.75%, 11/26/2019 | | | 149,220 | |
| | | | European Investment Bank | | | | |
| 850,000 | | | 2.88%, 09/15/2020 | | | 866,554 | |
| | | | Inter-American Development Bank | | | | |
| 570,000 | | | 3.88%, 02/14/2020 | | | 591,160 | |
| | | | International Bank for Reconstruction & Development | | | | |
| 512,000 | | | 7.63%, 01/19/2023 | | | 637,681 | |
| | | | | | | | |
| | | | | | | 2,331,828 | |
| | | | | | | | |
| | | Office/Business Equipment - 0.0% | | | |
| | | | Xerox Corp. | | | | |
| 10,000 | | | 4.07%, 03/17/2022 | | | 10,096 | |
| | | | | | | | |
| | | Oil&Gas - 0.9% | | | |
| | | | Anadarko Petroleum Corp. | | | | |
| 60,000 | | | 6.20%, 03/15/2040 | | | 72,753 | |
| | | | Apache Corp. | | | | |
| 85,000 | | | 5.10%, 09/01/2040 | | | 90,558 | |
| | | | BP Capital Markets plc | | | | |
| 280,000 | | | 3.25%, 05/06/2022 | | | 286,994 | |
| | | | Canadian Natural Resources Ltd. | | | | |
| 40,000 | | | 6.50%, 02/15/2037 | | | 50,758 | |
| | | | Chevron Corp. | | | | |
| 125,000 | | | 2.36%, 12/05/2022 | | | 124,009 | |
| 150,000 | | | 2.43%, 06/24/2020 | | | 150,734 | |
| | | | ConocoPhillips | | | | |
| 108,000 | | | 6.50%, 02/01/2039 | | | 151,139 | |
| | | | Devon Financing Co. LLC | | | | |
| 65,000 | | | 7.88%, 09/30/2031 | | | 89,232 | |
| | | | Exxon Mobil Corp. | | | | |
| 55,000 | | | 2.71%, 03/06/2025 | | | 54,813 | |
| 40,000 | | | 3.57%, 03/06/2045 | | | 40,421 | |
| | | | Hess Corp. | | | | |
| 28,000 | | | 5.60%, 02/15/2041 | | | 30,194 | |
| | | | Kerr-McGee Corp. | | | | |
| 60,000 | | | 6.95%, 07/01/2024 | | | 70,727 | |
| | | | Marathon Oil Corp. | | | | |
| 15,000 | | | 6.60%, 10/01/2037 | | | 18,794 | |
| | | | Marathon Petroleum Corp. | | | | |
| 35,000 | | | 5.00%, 09/15/2054 | | | 35,446 | |
| 15,000 | | | 5.13%, 03/01/2021 | | | 16,099 | |
| | | | Nexen Energy ULC | | | | |
| 50,000 | | | 7.50%, 07/30/2039 | | | 73,867 | |
| | | | Noble Energy, Inc. | | | | |
| 60,000 | | | 6.00%, 03/01/2041 | | | 70,961 | |
| | | | | | | | |
Shares or Principal Amount | | Market Value(1) | |
CORPORATE BONDS - 14.5% - (continued) | |
| | | Oil&Gas - 0.9% - (continued) | | | |
| | | | Occidental Petroleum Corp. | | | | |
$ | 35,000 | | | 4.40%, 04/15/2046 | | $ | 38,743 | |
| | | | Series 1 | | | | |
| 40,000 | | | 4.10%, 02/01/2021 | | | 41,894 | |
| | | | Petroleos Mexicanos | | | | |
| 100,000 | | | 4.88%, 01/24/2022 | | | 104,225 | |
| 195,000 | | | 6.50%, 06/02/2041 | | | 200,558 | |
| | | | Phillips 66 | | | | |
| 35,000 | | | 4.30%, 04/01/2022 | | | 37,199 | |
| 45,000 | | | 4.88%, 11/15/2044 | | | 51,542 | |
| | | | Shell International Finance BV | | | | |
| 140,000 | | | 3.63%, 08/21/2042 | | | 138,225 | |
| 170,000 | | | 4.30%, 09/22/2019 | | | 176,103 | |
| | | | Statoil ASA | | | | |
| 35,000 | | | 5.10%, 08/17/2040 | | | 42,199 | |
| | | | Suncor Energy, Inc. | | | | |
| 60,000 | | | 6.50%, 06/15/2038 | | | 81,061 | |
| | | | Total Capital S.A. | | | | |
| 95,000 | | | 4.25%, 12/15/2021 | | | 101,118 | |
| | | | Valero Energy Corp. | | | | |
| 140,000 | | | 6.13%, 02/01/2020 | | | 150,780 | |
| 40,000 | | | 7.50%, 04/15/2032 | | | 53,905 | |
| | | | | | | | |
| | | | | | | 2,645,051 | |
| | | | | | | | |
| | | Oil&Gas Services - 0.0% | | | |
| | | | Baker Hughes a GE Co. LLC | | | | |
| 46,000 | | | 5.13%, 09/15/2040 | | | 54,078 | |
| | | | National Oilwell Varco, Inc. | | | | |
| 50,000 | | | 2.60%, 12/01/2022 | | | 48,827 | |
| 15,000 | | | 3.95%, 12/01/2042 | | | 13,230 | |
| | | | | | | | |
| | | | | | | 116,135 | |
| | | | | | | | |
| | | Pharmaceuticals - 0.8% | | | |
| | | | AbbVie, Inc. | | | | |
| 420,000 | | | 2.90%, 11/06/2022 | | | 421,221 | |
| | | | Allergan Funding SCS | | | | |
| 200,000 | | | 3.85%, 06/15/2024 | | | 204,949 | |
| | | | Allergan Funding SCS | | | | |
| 7,000 | | | 4.75%, 03/15/2045 | | | 7,452 | |
| | | | AstraZeneca plc | | | | |
| 60,000 | | | 6.45%, 09/15/2037 | | | 81,525 | |
| | | | Baxalta, Inc. | | | | |
| 100,000 | | | 4.00%, 06/23/2025 | | | 103,358 | |
| | | | Bristol-Myers Squibb Co. | | | | |
| 25,000 | | | 3.25%, 08/01/2042 | | | 23,901 | |
| | | | Cardinal Health, Inc. | | | | |
| 105,000 | | | 3.50%, 11/15/2024 | | | 105,486 | |
| | | | Express Scripts Holding Co. | | | | |
| 165,000 | | | 4.50%, 02/25/2026 | | | 175,099 | |
| | | | GlaxoSmithKline Capital, Inc. | | | | |
| 40,000 | | | 2.80%, 03/18/2023 | | | 40,348 | |
| 47,000 | | | 6.38%, 05/15/2038 | | | 66,304 | |
| | | | Johnson & Johnson | | | | |
| 100,000 | | | 5.95%, 08/15/2037 | | | 137,188 | |
| | | | McKesson Corp. | | | | |
| 70,000 | | | 3.80%, 03/15/2024 | | | 72,506 | |
| 50,000 | | | 4.75%, 03/01/2021 | | | 52,991 | |
| | | | Merck & Co., Inc. | | | | |
| 75,000 | | | 3.60%, 09/15/2042 | | | 76,567 | |
| | | | Mylan N.V. | | | | |
| 60,000 | | | 3.95%, 06/15/2026 | | | 60,502 | |
The accompanying Notes are an integral part of these financial statements.
|
HIMCO VIT Portfolio Diversifier Fund |
Schedule of Investments – (continued)
December 31, 2017
| | | | | | | | |
Shares or Principal Amount | | Market Value(1) | |
CORPORATE BONDS - 14.5% - (continued) | |
| | | Pharmaceuticals - 0.8% - (continued) | | | |
| | | | Novartis Capital Corp. | | | | |
$ | 145,000 | | | 2.40%, 09/21/2022 | | $ | 144,190 | |
| | | | Pfizer, Inc. | | | | |
| 140,000 | | | 3.00%, 12/15/2026 | | | 140,844 | |
| | | | Sanofi | | | | |
| 20,000 | | | 4.00%, 03/29/2021 | | | 21,044 | |
| | | | Teva Pharmaceutical Finance IV BV | | | | |
| 28,000 | | | 3.65%, 11/10/2021 | | | 26,636 | |
| | | | Teva Pharmaceutical Finance Netherlands III BV | | | | |
| 160,000 | | | 3.15%, 10/01/2026 | | | 132,103 | |
| | | | Wyeth LLC | | | | |
| 40,000 | | | 5.95%, 04/01/2037 | | | 53,626 | |
| | | | | | | | |
| | | | | | | 2,147,840 | |
| | | | | | | | |
| | | Pipelines - 0.4% | | | |
| | | | Energy Transfer L.P. | | | | |
| 100,000 | | | 6.50%, 02/01/2042 | | | 113,231 | |
| 64,000 | | | 9.00%, 04/15/2019 | | | 69,057 | |
| | | | Enterprise Products Operating LLC | | | | |
| 100,000 | | | 4.45%, 02/15/2043 | | | 103,519 | |
| 40,000 | | | 4.85%, 03/15/2044 | | | 43,542 | |
| | | | Kinder Morgan Energy Partners L.P. | | | | |
| 55,000 | | | 4.70%, 11/01/2042 | | | 53,244 | |
| 102,000 | | | 6.38%, 03/01/2041 | | | 118,561 | |
| | | | MPLX L.P. | | | | |
| 100,000 | | | 4.13%, 03/01/2027 | | | 102,424 | |
| | | | ONEOK Partners L.P. | | | | |
| 40,000 | | | 6.65%, 10/01/2036 | | | 49,095 | |
| | | | Plains All American Pipeline L.P./PAA Finance Corp. | | | | |
| 65,000 | | | 6.65%, 01/15/2037 | | | 74,220 | |
| | | | TransCanada PipeLines Ltd. | | | | |
| 195,000 | | | 3.75%, 10/16/2023 | | | 203,743 | |
| 55,000 | | | 3.80%, 10/01/2020 | | | 57,027 | |
| | | | Transcontinental Gas Pipe Line Co. LLC | | | | |
| 20,000 | | | 4.45%, 08/01/2042 | | | 20,927 | |
| | | | Williams Partners L.P. | | | | |
| 125,000 | | | 4.13%, 11/15/2020 | | | 129,799 | |
| 40,000 | | | 6.30%, 04/15/2040 | | | 49,198 | |
| | | | | | | | |
| | | | | | | 1,187,587 | |
| | | | | | | | |
| | | Real Estate Investment Trusts - 0.1% | | | |
| | | | Boston Properties L.P. | | | | |
| 100,000 | | | 5.88%, 10/15/2019 | | | 105,411 | |
| | | | ERP Operating L.P. | | | | |
| 40,000 | | | 4.50%, 07/01/2044 | | | 43,788 | |
| | | | Welltower, Inc. | | | | |
| 40,000 | | | 3.75%, 03/15/2023 | | | 41,450 | |
| 55,000 | | | 5.25%, 01/15/2022 | | | 59,768 | |
| | | | Weyerhaeuser Co. | | | | |
| 40,000 | | | 7.38%, 03/15/2032 | | | 55,251 | |
| | | | | | | | |
| | | | | | | 305,668 | |
| | | | | | | | |
| | | Retail - 0.6% | | | |
| | | | CVS Health Corp. | | | | |
| 340,000 | | | 4.00%, 12/05/2023 | | | 353,503 | |
| | | | Home Depot, Inc. (The) | | | | |
| 160,000 | | | 2.70%, 04/01/2023 | | | 161,531 | |
| 85,000 | | | 5.88%, 12/16/2036 | | | 115,023 | |
| | | | | | | | |
Shares or Principal Amount | | Market Value(1) | |
CORPORATE BONDS - 14.5% - (continued) | |
| | | Retail - 0.6% - (continued) | | | |
| | | | McDonald’s Corp. | | | | |
$ | 100,000 | | | 2.75%, 12/09/2020 | | $ | 101,037 | |
| 84,000 | | | 3.70%, 02/15/2042 | | | 82,002 | |
| | | | Target Corp. | | | | |
| 140,000 | | | 2.30%, 06/26/2019 | | | 140,673 | |
| 119,000 | | | 2.50%, 04/15/2026 | | | 114,414 | |
| | | | Wal-Mart Stores, Inc. | | | | |
| 220,000 | | | 2.65%, 12/15/2024 | | | 219,130 | |
| 50,000 | | | 3.25%, 10/25/2020 | | | 51,512 | |
| 50,000 | | | 3.63%, 12/15/2047 | | | 52,382 | |
| 50,000 | | | 4.25%, 04/15/2021 | | | 53,120 | |
| | | | Walgreen Co. | | | | |
| 110,000 | | | 3.10%, 09/15/2022 | | | 110,440 | |
| | | | Walgreens Boots Alliance, Inc. | | | | |
| 40,000 | | | 4.80%, 11/18/2044 | | | 43,066 | |
| | | | | | | | |
| | | | | | | 1,597,833 | |
| | | | | | | | |
| | | Semiconductors - 0.2% | | | |
| | | | Broadcom Corp./Broadcom Cayman Finance Ltd. | | | | |
| 110,000 | | | 3.88%, 01/15/2027(5) | | | 108,245 | |
| | | | Intel Corp. | | | | |
| 330,000 | | | 2.70%, 12/15/2022 | | | 333,670 | |
| | | | QUALCOMM, Inc. | | | | |
| 85,000 | | | 3.45%, 05/20/2025 | | | 85,193 | |
| | | | Texas Instruments, Inc. | | | | |
| 80,000 | | | 1.65%, 08/03/2019 | | | 79,521 | |
| | | | | | | | |
| | | | | | | 606,629 | |
| | | | | | | | |
| | | Software - 0.4% | | | |
| | | | Microsoft Corp. | | | | |
| 225,000 | | | 3.13%, 11/03/2025 | | | 229,712 | |
| 180,000 | | | 3.30%, 02/06/2027 | | | 185,670 | |
| 70,000 | | | 4.00%, 02/12/2055 | | | 74,888 | |
| 85,000 | | | 5.20%, 06/01/2039 | | | 107,479 | |
| | | | Oracle Corp. | | | | |
| 210,000 | | | 2.65%, 07/15/2026 | | | 204,739 | |
| 85,000 | | | 4.13%, 05/15/2045 | | | 91,676 | |
| 40,000 | | | 5.38%, 07/15/2040 | | | 50,573 | |
| | | | Visa, Inc. | | | | |
| 250,000 | | | 3.15%, 12/14/2025 | | | 255,574 | |
| | | | | | | | |
| | | | | | | 1,200,311 | |
| | | | | | | | |
| | | Telecommunications - 0.8% | | | |
| | | | America Movil S.A.B. de C.V. | | | | |
| 60,000 | | | 6.13%, 11/15/2037 | | | 75,244 | |
| | | | AT&T, Inc. | | | | |
| 250,000 | | | 3.40%, 05/15/2025 | | | 245,787 | |
| 59,000 | | | 4.10%, 02/15/2028(5) | | | 59,195 | |
| 222,000 | | | 4.55%, 03/09/2049 | | | 208,942 | |
| 120,000 | | | 5.15%, 03/15/2042 | | | 124,508 | |
| 90,000 | | | 5.15%, 02/14/2050 | | | 91,122 | |
| 14,000 | | | 5.35%, 09/01/2040 | | | 14,774 | |
| 25,000 | | | 7.13%, 12/15/2031(5) | | | 30,189 | |
| | | | British Telecommunications plc | | | | |
| 43,000 | | | 9.13%, 12/15/2030 | | | 64,245 | |
| | | | Cisco Systems, Inc. | | | | |
| 120,000 | | | 4.45%, 01/15/2020 | | | 125,491 | |
| 60,000 | | | 5.50%, 01/15/2040 | | | 79,392 | |
| | | | Deutsche Telekom International Finance BV | | | | |
| 37,000 | | | 8.75%, 06/15/2030 | | | 54,745 | |
The accompanying Notes are an integral part of these financial statements.
|
HIMCO VIT Portfolio Diversifier Fund |
Schedule of Investments – (continued)
December 31, 2017
| | | | | | | | |
Shares or Principal Amount | | Market Value(1) | |
CORPORATE BONDS - 14.5% - (continued) | |
| | | Telecommunications - 0.8% - (continued) | | | |
| | | | Orange S.A. | | | | |
$ | 80,000 | | | 5.38%, 07/08/2019 | | $ | 83,624 | |
| 25,000 | | | 5.38%, 01/13/2042 | | | 30,158 | |
| | | | Rogers Communications, Inc. | | | | |
| 30,000 | | | 4.50%, 03/15/2043 | | | 32,187 | |
| | | | Telefonica Emisiones SAU | | | | |
| 100,000 | | | 5.46%, 02/16/2021 | | | 108,171 | |
| | | | Verizon Communications, Inc. | | | | |
| 143,000 | | | 2.95%, 03/15/2022 | | | 143,871 | |
| 239,000 | | | 3.38%, 02/15/2025(5) | | | 239,903 | |
| 276,000 | | | 5.01%, 08/21/2054 | | | 282,621 | |
| | | | Vodafone Group plc | | | | |
| 95,000 | | | 5.45%, 06/10/2019 | | | 99,281 | |
| 50,000 | | | 6.15%, 02/27/2037 | | | 62,715 | |
| | | | | | | | |
| | | | | | | 2,256,165 | |
| | | | | | | | |
| | | Transportation - 0.4% | | | |
| | | | Burlington Northern Santa Fe LLC | | | | |
| 47,000 | | | 4.38%, 09/01/2042 | | | 52,497 | |
| 45,000 | | | 4.45%, 03/15/2043 | | | 50,710 | |
| 170,000 | | | 4.70%, 10/01/2019 | | | 177,200 | |
| | | | Canadian National Railway Co. | | | | |
| 40,000 | | | 2.85%, 12/15/2021 | | | 40,455 | |
| | | | Canadian Pacific Railway Co. | | | | |
| 60,000 | | | 4.45%, 03/15/2023 | | | 63,998 | |
| 8,000 | | | 7.13%, 10/15/2031 | | | 10,946 | |
| | | | CSX Corp. | | | | |
| 85,000 | | | 3.70%, 10/30/2020 | | | 87,806 | |
| 105,000 | | | 4.25%, 06/01/2021 | | | 110,311 | |
| | | | FedEx Corp. | | | | |
| 70,000 | | | 4.10%, 02/01/2045 | | | 72,155 | |
| | | | Norfolk Southern Corp. | | | | |
| 70,000 | | | 4.84%, 10/01/2041 | | | 81,585 | |
| | | | Union Pacific Corp. | | | | |
| 67,000 | | | 3.80%, 10/01/2051 | | | 68,312 | |
| 60,000 | | | 4.00%, 02/01/2021 | | | 62,806 | |
| | | | United Parcel Service, Inc. | | | | |
| 110,000 | | | 3.13%, 01/15/2021 | | | 112,708 | |
| | | | | | | | |
| | | | | | | 991,489 | |
| | | | | | | | |
| | |
| | | | Total Corporate Bonds (cost $40,599,013) | | | 41,473,982 | |
| | | | | | | | |
|
FOREIGN GOVERNMENT OBLIGATIONS - 1.1% | |
| | | Canada - 0.2% | | | |
| | | | Hydro-Quebec | | | | |
| 70,000 | | | 8.40%, 01/15/2022 | | | 83,780 | |
| 105,000 | | | Province of British Columbia 2.65%, 09/22/2021 | | | 106,071 | |
| | | | Province of Manitoba | | | | |
| 85,000 | | | 2.10%, 09/06/2022 | | | 83,165 | |
| | | | Province of Ontario | | | | |
| 285,000 | | | 4.40%, 04/14/2020 | | | 298,500 | |
| | | | Province of Quebec | | | | |
| 70,000 | | | 7.50%, 09/15/2029 | | | 99,578 | |
| | | | | | | | |
| | | | | | | 671,094 | |
| | | | | | | | |
| | | Colombia - 0.1% | | | |
| | | | Colombia Government International Bond | | | | |
| 240,000 | | | 8.13%, 05/21/2024 | | | 302,808 | |
| | | | | | | | |
| | | | | | | | |
Shares or Principal Amount | | Market Value(1) | |
FOREIGN GOVERNMENT OBLIGATIONS - 1.1% - (continued) | |
| | | Germany - 0.4% | | | |
| | | | KFW | | | | |
$ | 420,000 | | | 2.13%, 01/17/2023 | | $ | 415,274 | |
| 561,000 | | | 4.00%, 01/27/2020 | | | 583,008 | |
| | | | | | | | |
| | | | | | | 998,282 | |
| | | | | | | | |
| | | Hungary - 0.1% | | | |
| | | | Hungary Government International Bond | | | | |
| 100,000 | | | 5.38%, 03/25/2024 | | | 113,122 | |
| | | | | | | | |
| | | Italy - 0.0% | | | |
| | | | Italy Government International Bond | | | | |
| 45,000 | | | 5.38%, 06/15/2033 | | | 52,746 | |
| | | | | | | | |
| | | Mexico - 0.1% | | | |
| | | | Mexico Government International Bond | | | | |
| 70,000 | | | 3.63%, 03/15/2022 | | | 72,730 | |
| 252,000 | | | 6.05%, 01/11/2040 | | | 296,856 | |
| | | | | | | | |
| | | | | | | 369,586 | |
| | | | | | | | |
| | | Panama - 0.0% | | | |
| | | | Panama Government International Bond | | | | |
| 50,000 | | | 6.70%, 01/26/2036 | | | 66,550 | |
| | | | | | | | |
| | | Peru - 0.0% | | | |
| | | | Peruvian Government International Bond | | | | |
| 75,000 | | | 5.63%, 11/18/2050 | | | 96,225 | |
| | | | | | | | |
| | | Philippines - 0.1% | | | |
| | | | Philippine Government International Bond | | | | |
| 120,000 | | | 4.00%, 01/15/2021 | | | 125,859 | |
| 100,000 | | | 6.38%, 10/23/2034 | | | 133,742 | |
| | | | | | | | |
| | | | | | | 259,601 | |
| | | | | | | | |
| | | Poland - 0.1% | | | |
| | | | Poland Government International Bond | | | | |
| 140,000 | | | 5.00%, 03/23/2022 | | | 153,300 | |
| | | | | | | | |
| | | Uruguay - 0.0% | | | |
| | | | Uruguay Government International Bond | | | | |
| 45,000 | | | 5.10%, 06/18/2050 | | | 49,950 | |
| | | | | | | | |
| | |
| | | | Total Foreign Government Obligations (cost $3,076,154) | | | 3,133,264 | |
| | | | | | | | |
|
MUNICIPAL BONDS - 0.3% | |
| | | Airport Revenues - 0.0% | | | |
| | | | County of Clark Department of Aviation | | | | |
| 5,000 | | | 6.82%, 07/01/2045 | | | 7,799 | |
| | | | | | | | |
| | | General Obligations - 0.1% | | | |
| | | | California State, GO, | | | | |
| 105,000 | | | 7.60%, 11/01/2040 | | | 167,678 | |
| | | | Connecticut State, GO | | | | |
| 45,000 | | | 5.85%, 03/15/2032 | | | 54,120 | |
| | | | Massachusetts State, GO | | | | |
| 15,000 | | | 5.46%, 12/01/2039 | | | 19,112 | |
| | | | Mississippi State, GO | | | | |
| 25,000 | | | 5.25%, 11/01/2034 | | | 29,922 | |
| | | | New York, NY, GO | | | | |
| 15,000 | | | 5.85%, 06/01/2040 | | | 19,764 | |
| | | | Texas State, GO | | | | |
| 30,000 | | | 5.52%, 04/01/2039 | | | 39,384 | |
| | | | | | | | |
| | | | | | | 329,980 | |
| | | | | | | | |
The accompanying Notes are an integral part of these financial statements.
|
HIMCO VIT Portfolio Diversifier Fund |
Schedule of Investments – (continued)
December 31, 2017
| | | | | | | | |
Shares or Principal Amount | | Market Value(1) | |
MUNICIPAL BONDS - 0.3% - (continued) | |
| | | Higher Education (Universities, Dorms, etc.) - 0.0% | |
| | | | University of California Build America Bonds Rev., | | | | |
$ | 50,000 | | | 5.77%, 05/15/2043 | | $ | 65,398 | |
| | | | University of Texas System | | | | |
| 25,000 | | | 4.79%, 08/15/2046 | | | 30,024 | |
| | | | | | | | |
| | | | | | | 95,422 | |
| | | | | | | | |
| | | Miscellaneous - 0.0% | | | |
| | | | New Jersey State Economic Development Authority Lease Rev., | | | | |
| 15,000 | | | 7.43%, 02/15/2029 | | | 18,760 | |
| | | | | | | | |
| | | Tax Allocation - 0.0% | | | |
| | | | New York State Dormitory Authority | | | | |
| 20,000 | | | 5.60%, 03/15/2040 | | | 25,675 | |
| | | | | | | | |
| | | Transportation - 0.1% | | | |
| | | | Bay Area Toll Authority | | | | |
| 30,000 | | | 6.26%, 04/01/2049 | | | 44,320 | |
| | | | Metropolitan Transportation Authority | | | | |
| 20,000 | | | 5.87%, 11/15/2039 | | | 25,774 | |
| 25,000 | | | 6.55%, 11/15/2031 | | | 32,783 | |
| 15,000 | | | 6.65%, 11/15/2039 | | | 20,987 | |
| | | | New Jersey State Turnpike Authority | | | | |
| 45,000 | | | 7.10%, 01/01/2041 | | | 67,227 | |
| 15,000 | | | 7.41%, 01/01/2040 | | | 23,153 | |
| | | | Port Authority of New York & New Jersey | | | | |
| 50,000 | | | 4.93%, 10/01/2051 | | | 61,781 | |
| | | | | | | | |
| | | | | | | 276,025 | |
| | | | | | | | |
| | | Utilities - Electric - 0.1% | | | |
| | | | American Municipal Power Inc. | | | | |
| 45,000 | | | 6.05%, 02/15/2043 | | | 60,641 | |
| | | | Municipal Electric Authority of Georgia | | | | |
| 40,000 | | | 6.64%, 04/01/2057 | | | 51,274 | |
| | | | | | | | |
| | | | | | | 111,915 | |
| | | | | | | | |
| | | Utilities - Water and Sewer - 0.0% | | | |
| | | | New York City Water & Sewer System | | | | |
| 45,000 | | | 5.88%, 06/15/2044 | | | 62,253 | |
| | | | | | | | |
| | |
| | | | Total Municipal Bonds (cost $823,884) | | | 927,829 | |
| | | | | | | | |
|
U.S. GOVERNMENT AGENCIES - 14.9% | |
| | | FHLB - 0.2% | | | |
| 650,000 | | | 1.38%, 11/15/2019 | | | 643,482 | |
| 60,000 | | | 5.50%, 07/15/2036 | | | 82,289 | |
| | | | | | | | |
| | | | | | | 725,771 | |
| | | | | | | | |
| | | FHLMC - 4.3% | | | |
| 10,000 | | | 2.41%, 03/25/2023 | | | 9,966 | |
| 10,000 | | | 2.45%, 08/25/2023 | | | 9,959 | |
| 63,255 | | | 2.50%, 07/01/2027 | | | 63,587 | |
| 42,628 | | | 2.50%, 09/01/2027 | | | 42,851 | |
| 68,468 | | | 2.50%, 10/01/2027 | | | 68,814 | |
| 156,427 | | | 2.50%, 04/01/2028 | | | 157,188 | |
| 204,278 | | | 2.50%, 06/01/2028 | | | 205,269 | |
| 61,173 | | | 2.50%, 01/01/2029 | | | 61,470 | |
| 280,222 | | | 2.50%, 12/01/2031 | | | 280,106 | |
| 109,332 | | | 2.50%, 12/01/2042 | | | 105,606 | |
| 10,000 | | | 2.53%, 05/25/2026 | | | 9,800 | |
| 10,000 | | | 2.57%, 07/25/2026 | | | 9,836 | |
| | | | | | | | |
Shares or Principal Amount | | Market Value(1) | |
U.S. GOVERNMENT AGENCIES - 14.9% - (continued) | |
| | | FHLMC - 4.3% - (continued) | | | |
$ | 10,000 | | | 2.65%, 08/25/2026 | | $ | 9,883 | |
| 15,000 | | | 2.67%, 12/25/2024 | | | 15,020 | |
| 10,000 | | | 2.67%, 03/25/2026 | | | 9,919 | |
| 10,000 | | | 2.75%, 01/25/2026 | | | 9,982 | |
| 15,000 | | | 2.79%, 01/25/2022 | | | 15,204 | |
| 15,000 | | | 2.81%, 01/25/2025 | | | 15,131 | |
| 10,000 | | | 2.95%, 07/25/2024 | | | 10,180 | |
| 10,000 | | | 3.00%, 12/25/2025 | | | 10,159 | |
| 18,038 | | | 3.00%, 12/01/2025 | | | 18,377 | |
| 127,743 | | | 3.00%, 11/01/2026 | | | 130,143 | |
| 14,441 | | | 3.00%, 03/01/2027 | | | 14,712 | |
| 46,157 | | | 3.00%, 04/01/2027 | | | 47,024 | |
| 71,096 | | | 3.00%, 09/01/2027 | | | 72,431 | |
| 284,726 | | | 3.00%, 10/01/2028 | | | 290,250 | |
| 268,845 | | | 3.00%, 12/01/2031 | | | 273,987 | |
| 60,110 | | | 3.00%, 10/01/2042 | | | 60,441 | |
| 146,745 | | | 3.00%, 10/01/2042 | | | 147,553 | |
| 93,016 | | | 3.00%, 11/01/2042 | | | 93,528 | |
| 95,300 | | | 3.00%, 12/01/2042 | | | 95,855 | |
| 43,562 | | | 3.00%, 01/01/2043 | | | 43,809 | |
| 138,944 | | | 3.00%, 01/01/2043 | | | 139,724 | |
| 49,726 | | | 3.00%, 02/01/2043 | | | 50,003 | |
| 117,645 | | | 3.00%, 02/01/2043 | | | 118,190 | |
| 201,045 | | | 3.00%, 02/01/2043 | | | 202,164 | |
| 26,005 | | | 3.00%, 05/01/2043 | | | 26,155 | |
| 69,034 | | | 3.00%, 05/01/2043 | | | 69,432 | |
| 721,520 | | | 3.00%, 08/01/2045 | | | 722,350 | |
| 281,660 | | | 3.00%, 09/01/2046 | | | 282,050 | |
| 571,394 | | | 3.00%, 12/01/2046 | | | 572,185 | |
| 473,922 | | | 3.00%, 01/01/2047 | | | 474,554 | |
| 10,000 | | | 3.01%, 07/25/2025 | | | 10,183 | |
| 15,000 | | | 3.02%, 01/25/2025 | | | 15,333 | |
| 10,000 | | | 3.06%, 11/25/2023(4) | | | 10,264 | |
| 15,000 | | | 3.06%, 12/25/2024 | | | 15,376 | |
| 10,000 | | | 3.12%, 06/25/2027 | | | 10,204 | |
| 10,000 | | | 3.12%, 09/25/2026(4) | | | 10,221 | |
| 10,000 | | | 3.15%, 11/25/2025 | | | 10,274 | |
| 10,000 | | | 3.19%, 09/25/2027(4) | | | 10,254 | |
| 10,000 | | | 3.19%, 07/25/2027 | | | 10,268 | |
| 15,000 | | | 3.22%, 03/25/2027(4) | | | 15,457 | |
| 10,000 | | | 3.24%, 04/25/2027 | | | 10,306 | |
| 10,000 | | | 3.24%, 08/25/2027 | | | 10,301 | |
| 10,000 | | | 3.30%, 10/25/2026 | | | 10,361 | |
| 15,000 | | | 3.33%, 05/25/2025(4) | | | 15,608 | |
| 15,000 | | | 3.33%, 08/25/2025(4) | | | 15,602 | |
| 10,000 | | | 3.35%, 11/25/2026(4) | | | 10,398 | |
| 10,000 | | | 3.41%, 12/25/2026 | | | 10,444 | |
| 15,000 | | | 3.43%, 01/25/2027(4) | | | 15,685 | |
| 50,201 | | | 3.50%, 04/01/2026 | | | 51,904 | |
| 51,681 | | | 3.50%, 08/01/2026 | | | 53,427 | |
| 165,842 | | | 3.50%, 10/01/2026 | | | 171,431 | |
| 70,580 | | | 3.50%, 10/01/2026 | | | 72,966 | |
| 229,028 | | | 3.50%, 07/01/2029 | | | 237,169 | |
| 21,331 | | | 3.50%, 10/01/2040 | | | 22,013 | |
| 33,091 | | | 3.50%, 10/01/2041 | | | 34,143 | |
| 74,932 | | | 3.50%, 11/01/2041 | | | 76,991 | |
| 64,538 | | | 3.50%, 02/01/2042 | | | 66,582 | |
| 23,072 | | | 3.50%, 03/01/2042 | | | 23,809 | |
| 65,836 | | | 3.50%, 04/01/2042 | | | 67,942 | |
| 62,950 | | | 3.50%, 04/01/2042 | | | 64,963 | |
| 111,822 | | | 3.50%, 09/01/2042 | | | 115,398 | |
The accompanying Notes are an integral part of these financial statements.
|
HIMCO VIT Portfolio Diversifier Fund |
Schedule of Investments – (continued)
December 31, 2017
| | | | | | | | |
Shares or Principal Amount | | Market Value(1) | |
U.S. GOVERNMENT AGENCIES - 14.9% - (continued) | |
| | | FHLMC - 4.3% - (continued) | | | |
$ | 55,211 | | | 3.50%, 09/01/2042 | | $ | 56,976 | |
| 164,843 | | | 3.50%, 11/01/2042 | | | 170,114 | |
| 61,357 | | | 3.50%, 01/01/2043 | | | 63,211 | |
| 177,903 | | | 3.50%, 12/01/2043 | | | 183,590 | |
| 378,717 | | | 3.50%, 09/01/2044 | | | 390,588 | |
| 1,223,492 | | | 3.50%, 08/01/2046 | | | 1,258,346 | |
| 680,000 | | | 3.75%, 03/27/2019 | | | 695,901 | |
| 16,464 | | | 4.00%, 06/01/2024 | | | 17,064 | |
| 41,546 | | | 4.00%, 07/01/2026 | | | 43,371 | |
| 43,728 | | | 4.00%, 10/01/2040 | | | 45,906 | |
| 79,578 | | | 4.00%, 10/01/2040 | | | 83,541 | |
| 61,008 | | | 4.00%, 10/01/2040 | | | 64,051 | |
| 9,815 | | | 4.00%, 12/01/2040 | | | 10,305 | |
| 48,921 | | | 4.00%, 12/01/2040 | | | 51,357 | |
| 13,512 | | | 4.00%, 02/01/2041 | | | 14,186 | |
| 84,270 | | | 4.00%, 02/01/2041 | | | 88,473 | |
| 11,471 | | | 4.00%, 04/01/2041 | | | 12,022 | |
| 78,438 | | | 4.00%, 01/01/2042 | | | 82,354 | |
| 137,605 | | | 4.00%, 02/01/2042 | | | 144,473 | |
| 214,482 | | | 4.00%, 11/01/2043 | | | 226,144 | |
| 217,399 | | | 4.00%, 05/01/2044 | | | 227,421 | |
| 136,604 | | | 4.00%, 07/01/2044 | | | 142,910 | |
| 230,338 | | | 4.00%, 12/01/2046 | | | 240,908 | |
| 660 | | | 4.50%, 05/01/2018 | | | 670 | |
| 11,478 | | | 4.50%, 11/01/2024 | | | 12,033 | |
| 34,429 | | | 4.50%, 09/01/2031 | | | 36,789 | |
| 95,490 | | | 4.50%, 10/01/2039 | | | 101,712 | |
| 17,415 | | | 4.50%, 05/01/2040 | | | 18,581 | |
| 44,587 | | | 4.50%, 10/01/2040 | | | 47,465 | |
| 91,053 | | | 4.50%, 06/01/2041 | | | 97,058 | |
| 99,434 | | | 4.50%, 09/01/2041 | | | 106,093 | |
| 30,550 | | | 5.00%, 05/01/2023 | | | 31,880 | |
| 59,093 | | | 5.00%, 03/01/2027 | | | 63,501 | |
| 44,102 | | | 5.00%, 11/01/2033 | | | 48,057 | |
| 19,522 | | | 5.00%, 02/01/2038 | | | 21,137 | |
| 4,700 | | | 5.00%, 04/01/2039 | | | 5,115 | |
| 352,575 | | | 5.00%, 08/01/2041 | | | 385,154 | |
| 18,696 | | | 5.00%, 08/01/2041 | | | 20,090 | |
| 152,531 | | | 5.50%, 05/01/2036 | | | 169,351 | |
| 11,107 | | | 5.50%, 05/01/2038 | | | 12,258 | |
| 32,073 | | | 5.50%, 05/01/2038 | | | 35,459 | |
| 35,304 | | | 5.50%, 08/01/2038 | | | 39,038 | |
| 22,300 | | | 6.00%, 06/01/2036 | | | 25,141 | |
| 23,610 | | | 6.00%, 04/01/2037 | | | 26,500 | |
| 11,626 | | | 6.00%, 10/01/2037 | | | 13,081 | |
| 150,000 | | | 6.25%, 07/15/2032 | | | 210,418 | |
| | | | | | | | |
| | | | | | | 12,179,917 | |
| | | | | | | | |
| | | FNMA - 6.5% | | | |
| 900,000 | | | 1.75%, 06/20/2019 | | | 898,507 | |
| 5,000 | | | 2.29%, 06/25/2026 | | | 4,790 | |
| 10,000 | | | 2.37%, 07/25/2026(4) | | | 9,628 | |
| 10,000 | | | 2.42%, 10/25/2026(4) | | | 9,668 | |
| 10,000 | | | 2.45%, 09/25/2026(4) | | | 9,667 | |
| 5,000 | | | 2.49%, 05/25/2026 | | | 4,880 | |
| 147,184 | | | 2.50%, 03/01/2027 | | | 147,919 | |
| 67,023 | | | 2.50%, 07/01/2027 | | | 67,359 | |
| 153,595 | | | 2.50%, 12/01/2027 | | | 154,363 | |
| 85,982 | | | 2.50%, 02/01/2028 | | | 86,386 | |
| 235,967 | | | 2.50%, 04/01/2028 | | | 237,076 | |
| 221,072 | | | 2.50%, 07/01/2028 | | | 222,111 | |
| | | | | | | | |
Shares or Principal Amount | | Market Value(1) | |
U.S. GOVERNMENT AGENCIES - 14.9% - (continued) | |
| | | FNMA - 6.5% - (continued) | | | |
$ | 538,148 | | | 2.50%, 10/01/2031 | | $ | 537,684 | |
| 127,744 | | | 2.50%, 01/01/2043 | | | 123,867 | |
| 15,000 | | | 2.53%, 09/25/2024 | | | 14,842 | |
| 10,000 | | | 2.58%, 03/25/2026 | | | 9,806 | |
| 15,000 | | | 2.59%, 12/25/2024 | | | 14,925 | |
| 10,000 | | | 2.70%, 02/25/2026 | | | 9,905 | |
| 10,000 | | | 2.71%, 06/25/2025(4) | | | 9,958 | |
| 10,000 | | | 2.72%, 10/25/2024 | | | 9,997 | |
| 10,000 | | | 2.90%, 01/25/2025(4) | | | 10,061 | |
| 10,000 | | | 2.94%, 01/25/2026(4) | | | 10,076 | |
| 33,450 | | | 3.00%, 12/01/2025 | | | 34,161 | |
| 26,503 | | | 3.00%, 12/01/2026 | | | 27,034 | |
| 72,582 | | | 3.00%, 03/01/2027 | | | 74,133 | |
| 79,029 | | | 3.00%, 04/01/2027 | | | 80,715 | |
| 229,401 | | | 3.00%, 07/01/2027 | | | 234,303 | |
| 46,829 | | | 3.00%, 08/01/2027 | | | 47,774 | |
| 155,312 | | | 3.00%, 02/01/2030 | | | 158,530 | |
| 417,221 | | | 3.00%, 02/01/2032 | | | 425,370 | |
| 34,460 | | | 3.00%, 04/01/2042 | | | 34,646 | |
| 35,491 | | | 3.00%, 09/01/2042 | | | 35,577 | |
| 69,866 | | | 3.00%, 11/01/2042 | | | 70,244 | |
| 115,532 | | | 3.00%, 11/01/2042 | | | 116,156 | |
| 155,608 | | | 3.00%, 12/01/2042 | | | 156,719 | |
| 191,107 | | | 3.00%, 01/01/2043 | | | 192,130 | |
| 101,296 | | | 3.00%, 02/01/2043 | | | 101,939 | |
| 255,022 | | | 3.00%, 02/01/2043 | | | 256,386 | |
| 151,217 | | | 3.00%, 04/01/2043 | | | 152,300 | |
| 328,548 | | | 3.00%, 04/01/2043 | | | 331,634 | |
| 89,041 | | | 3.00%, 04/01/2043 | | | 89,522 | |
| 59,858 | | | 3.00%, 07/01/2043 | | | 60,168 | |
| 106,831 | | | 3.00%, 10/01/2043 | | | 107,381 | |
| 198,159 | | | 3.00%, 11/01/2043 | | | 198,260 | |
| 889,923 | | | 3.00%, 03/01/2046 | | | 890,375 | |
| 533,536 | | | 3.00%, 10/01/2046 | | | 534,767 | |
| 105,788 | | | 3.00%, 11/01/2046 | | | 105,975 | |
| 1,021,828 | | | 3.00%, 11/01/2046 | | | 1,022,347 | |
| 402,487 | | | 3.00%, 12/01/2046 | | | 402,691 | |
| 382,908 | | | 3.00%, 01/01/2047 | | | 383,103 | |
| 10,000 | | | 3.06%, 05/25/2027(4) | | | 10,118 | |
| 10,000 | | | 3.08%, 06/25/2027(4) | | | 10,169 | |
| 6,941 | | | 3.50%, 09/01/2025 | | | 7,166 | |
| 77,528 | | | 3.50%, 10/01/2028 | | | 80,435 | |
| 148,497 | | | 3.50%, 07/01/2029 | | | 153,395 | |
| 231,307 | | | 3.50%, 01/01/2041 | | | 238,840 | |
| 44,573 | | | 3.50%, 02/01/2041 | | | 46,023 | |
| 45,527 | | | 3.50%, 04/01/2041 | | | 47,010 | |
| 60,870 | | | 3.50%, 11/01/2041 | | | 63,046 | |
| 75,279 | | | 3.50%, 01/01/2042 | | | 77,732 | |
| 28,561 | | | 3.50%, 03/01/2042 | | | 29,450 | |
| 71,480 | | | 3.50%, 05/01/2042 | | | 73,811 | |
| 91,632 | | | 3.50%, 06/01/2042 | | | 94,692 | |
| 79,397 | | | 3.50%, 07/01/2042 | | | 81,965 | |
| 214,145 | | | 3.50%, 07/01/2042 | | | 221,090 | |
| 60,199 | | | 3.50%, 08/01/2042 | | | 62,154 | |
| 80,013 | | | 3.50%, 08/01/2042 | | | 82,606 | |
| 69,627 | | | 3.50%, 08/01/2042 | | | 71,883 | |
| 297,411 | | | 3.50%, 09/01/2042 | | | 307,052 | |
| 49,158 | | | 3.50%, 09/01/2042 | | | 50,742 | |
| 89,939 | | | 3.50%, 09/01/2042 | | | 92,854 | |
| 67,647 | | | 3.50%, 01/01/2043 | | | 69,811 | |
| 193,899 | | | 3.50%, 05/01/2043 | | | 200,382 | |
The accompanying Notes are an integral part of these financial statements.
|
HIMCO VIT Portfolio Diversifier Fund |
Schedule of Investments – (continued)
December 31, 2017
| | | | | | | | |
Shares or Principal Amount | | Market Value(1) | |
U.S. GOVERNMENT AGENCIES - 14.9% - (continued) | |
| | | FNMA - 6.5% - (continued) | | | |
$ | 88,226 | | | 3.50%, 08/01/2043 | | $ | 91,246 | |
| 87,618 | | | 3.50%, 08/01/2043 | | | 90,421 | |
| 132,228 | | | 3.50%, 08/01/2043 | | | 136,592 | |
| 73,552 | | | 3.50%, 08/01/2044 | | | 75,558 | |
| 28,455 | | | 3.50%, 10/01/2044 | | | 29,231 | |
| 73,705 | | | 3.50%, 01/01/2045 | | | 75,715 | |
| 112,220 | | | 3.50%, 02/01/2045 | | | 115,280 | |
| 616,474 | | | 3.50%, 11/01/2045 | | | 635,069 | |
| 535,410 | | | 3.50%, 07/01/2046 | | | 550,010 | |
| 193,147 | | | 3.50%, 01/01/2047 | | | 198,414 | |
| 70,003 | | | 4.00%, 05/01/2020 | | | 72,045 | |
| 25,088 | | | 4.00%, 04/01/2025 | | | 26,132 | |
| 34,305 | | | 4.00%, 09/01/2025 | | | 35,732 | |
| 46,127 | | | 4.00%, 08/01/2026 | | | 47,472 | |
| 101,901 | | | 4.00%, 08/01/2040 | | | 107,047 | |
| 18,089 | | | 4.00%, 08/01/2040 | | | 19,007 | |
| 162,095 | | | 4.00%, 09/01/2040 | | | 170,229 | |
| 7,326 | | | 4.00%, 10/01/2040 | | | 7,696 | |
| 321,958 | | | 4.00%, 12/01/2040 | | | 338,204 | |
| 121,872 | | | 4.00%, 02/01/2041 | | | 128,025 | |
| 35,764 | | | 4.00%, 04/01/2041 | | | 37,405 | |
| 16,127 | | | 4.00%, 07/01/2041 | | | 17,009 | |
| 39,761 | | | 4.00%, 09/01/2041 | | | 41,753 | |
| 311,922 | | | 4.00%, 12/01/2041 | | | 329,250 | |
| 139,936 | | | 4.00%, 01/01/2042 | | | 146,883 | |
| 476,481 | | | 4.00%, 11/01/2043 | | | 502,449 | |
| 25,116 | | | 4.00%, 01/01/2044 | | | 26,306 | |
| 232,895 | | | 4.00%, 01/01/2044 | | | 244,121 | |
| 23,710 | | | 4.00%, 05/01/2044 | | | 24,821 | |
| 150,640 | | | 4.00%, 12/01/2044 | | | 157,694 | |
| 14,827 | | | 4.50%, 05/01/2025 | | | 15,491 | |
| 47,921 | | | 4.50%, 04/01/2026 | | | 50,577 | |
| 9,080 | | | 4.50%, 04/01/2029 | | | 9,683 | |
| 68,528 | | | 4.50%, 06/01/2030 | | | 73,150 | |
| 13,096 | | | 4.50%, 08/01/2038 | | | 13,970 | |
| 49,683 | | | 4.50%, 01/01/2039 | | | 52,900 | |
| 31,846 | | | 4.50%, 02/01/2039 | | | 33,972 | |
| 87,664 | | | 4.50%, 04/01/2039 | | | 93,516 | |
| 31,610 | | | 4.50%, 11/01/2039 | | | 33,657 | |
| 50,163 | | | 4.50%, 02/01/2040 | | | 53,641 | |
| 98,895 | | | 4.50%, 09/01/2040 | | | 106,034 | |
| 96,573 | | | 4.50%, 10/01/2040 | | | 103,521 | |
| 36,397 | | | 4.50%, 04/01/2041 | | | 38,754 | |
| 18,852 | | | 4.50%, 04/01/2041 | | | 20,207 | |
| 87,386 | | | 4.50%, 04/01/2041 | | | 93,680 | |
| 96,759 | | | 4.50%, 07/01/2041 | | | 103,616 | |
| 155,908 | | | 4.50%, 01/01/2044 | | | 166,164 | |
| 22,712 | | | 5.00%, 02/01/2022 | | | 23,122 | |
| 28,202 | | | 5.00%, 05/01/2028 | | | 30,276 | |
| 177,620 | | | 5.00%, 05/01/2035 | | | 192,931 | |
| 155,207 | | | 5.00%, 08/01/2035 | | | 168,641 | |
| 78,597 | | | 5.00%, 03/01/2037 | | | 84,723 | |
| 1,343 | | | 5.00%, 05/01/2037 | | | 1,448 | |
| 27,788 | | | 5.00%, 02/01/2039 | | | 30,043 | |
| 42,799 | | | 5.00%, 04/01/2039 | | | 46,133 | |
| 23,275 | | | 5.00%, 01/01/2040 | | | 25,116 | |
| 217,574 | | | 5.00%, 01/01/2041 | | | 234,660 | |
| 211,958 | | | 5.50%, 10/01/2035 | | | 233,727 | |
| 23,880 | | | 5.50%, 05/01/2037 | | | 26,387 | |
| 7,521 | | | 5.50%, 01/01/2038 | | | 8,288 | |
| 12,062 | | | 5.50%, 02/01/2038 | | | 13,321 | |
| | | | | | | | |
Shares or Principal Amount | | Market Value(1) | |
U.S. GOVERNMENT AGENCIES - 14.9% - (continued) | |
| | | FNMA - 6.5% - (continued) | | | |
$ | 90,116 | | | 5.50%, 02/01/2038 | | $ | 99,876 | |
| 47,234 | | | 5.50%, 06/01/2038 | | | 52,009 | |
| 17,240 | | | 5.50%, 07/01/2038 | | | 18,929 | |
| 19,146 | | | 5.50%, 08/01/2038 | | | 21,030 | |
| 60,030 | | | 5.50%, 09/01/2038 | | | 65,983 | |
| 15,371 | | | 5.50%, 05/01/2040 | | | 16,961 | |
| 130,000 | | | 5.63%, 07/15/2037 | | | 182,461 | |
| 27,035 | | | 6.00%, 04/01/2036 | | | 30,608 | |
| 44,565 | | | 6.00%, 07/01/2037 | | | 50,176 | |
| 50,018 | | | 6.00%, 07/01/2037 | | | 55,877 | |
| 25,633 | | | 6.50%, 06/01/2039 | | | 28,472 | |
| 53,000 | | | 6.63%, 11/15/2030 | | | 74,534 | |
| | | | | | | | |
| | | | | | | 18,455,322 | |
| | | | | | | | |
| | | GNMA - 3.8% | | | |
| 20,234 | | | 2.50%, 10/15/2027 | | | 20,347 | |
| 65,301 | | | 2.50%, 01/15/2043 | | | 63,614 | |
| 143,599 | | | 2.50%, 03/20/2047 | | | 140,320 | |
| 40,816 | | | 3.00%, 04/15/2027 | | | 41,729 | |
| 83,248 | | | 3.00%, 03/20/2028 | | | 85,406 | |
| 36,964 | | | 3.00%, 06/20/2042 | | | 37,451 | |
| 158,287 | | | 3.00%, 08/20/2042 | | | 160,423 | |
| 161,848 | | | 3.00%, 09/20/2042 | | | 164,049 | |
| 97,200 | | | 3.00%, 11/15/2042 | | | 98,318 | |
| 123,576 | | | 3.00%, 12/20/2042 | | | 125,294 | |
| 90,194 | | | 3.00%, 05/15/2043 | | | 91,534 | |
| 203,632 | | | 3.00%, 06/20/2043 | | | 206,505 | |
| 188,969 | | | 3.00%, 07/20/2043 | | | 191,636 | |
| 213,850 | | | 3.00%, 10/20/2045 | | | 215,998 | |
| 628,153 | | | 3.00%, 09/20/2046 | | | 634,463 | |
| 458,162 | | | 3.00%, 11/20/2046 | | | 462,764 | |
| 925,953 | | | 3.00%, 12/20/2046 | | | 935,254 | |
| 7,551 | | | 3.50%, 09/15/2025 | | | 7,822 | |
| 27,039 | | | 3.50%, 09/20/2040 | | | 28,102 | |
| 31,729 | | | 3.50%, 12/15/2040 | | | 32,834 | |
| 12,994 | | | 3.50%, 02/15/2041 | | | 13,446 | |
| 11,994 | | | 3.50%, 12/20/2041 | | | 12,465 | |
| 64,369 | | | 3.50%, 01/20/2042 | | | 66,902 | |
| 27,348 | | | 3.50%, 02/20/2042 | | | 28,424 | |
| 16,108 | | | 3.50%, 03/15/2042 | | | 16,678 | |
| 117,668 | | | 3.50%, 04/20/2042 | | | 122,297 | |
| 146,326 | | | 3.50%, 05/20/2042 | | | 152,083 | |
| 8,789 | | | 3.50%, 06/15/2042 | | | 9,113 | |
| 50,902 | | | 3.50%, 06/15/2042 | | | 52,788 | |
| 82,299 | | | 3.50%, 06/20/2042 | | | 85,613 | |
| 98,484 | | | 3.50%, 08/20/2042 | | | 102,358 | |
| 126,455 | | | 3.50%, 04/20/2043 | | | 131,430 | |
| 156,558 | | | 3.50%, 07/20/2043 | | | 162,718 | |
| 93,423 | | | 3.50%, 08/15/2043 | | | 97,156 | |
| 258,709 | | | 3.50%, 09/20/2043 | | | 268,890 | |
| 748,697 | | | 3.50%, 04/20/2045 | | | 775,025 | |
| 1,122,969 | | | 3.50%, 11/20/2046 | | | 1,162,037 | |
| 631,983 | | | 3.50%, 01/20/2047 | | | 653,969 | |
| 12,641 | | | 4.00%, 08/15/2026 | | | 13,176 | |
| 192,567 | | | 4.00%, 08/15/2039 | | | 201,082 | |
| 25,484 | | | 4.00%, 07/20/2040 | | | 26,825 | |
| 15,159 | | | 4.00%, 08/15/2040 | | | 15,866 | |
| 16,713 | | | 4.00%, 10/20/2040 | | | 17,591 | |
| 107,754 | | | 4.00%, 12/15/2040 | | | 113,163 | |
| 32,775 | | | 4.00%, 06/15/2041 | | | 34,385 | |
| 29,549 | | | 4.00%, 09/15/2041 | | | 31,305 | |
The accompanying Notes are an integral part of these financial statements.
|
HIMCO VIT Portfolio Diversifier Fund |
Schedule of Investments – (continued)
December 31, 2017
| | | | | | | | |
Shares or Principal Amount | | Market Value(1) | |
U.S. GOVERNMENT AGENCIES - 14.9% - (continued) | |
| | | GNMA - 3.8% - (continued) | | | |
$ | 11,942 | | | 4.00%, 12/20/2041 | | $ | 12,569 | |
| 24,241 | | | 4.00%, 01/20/2042 | | | 25,514 | |
| 15,162 | | | 4.00%, 03/20/2042 | | | 15,959 | |
| 56,183 | | | 4.00%, 05/20/2042 | | | 59,112 | |
| 41,549 | | | 4.00%, 06/15/2042 | | | 43,593 | |
| 218,780 | | | 4.00%, 06/20/2044 | | | 229,799 | |
| 176,774 | | | 4.00%, 09/20/2044 | | | 185,624 | |
| 193,755 | | | 4.00%, 11/20/2044 | | | 203,425 | |
| 369,569 | | | 4.00%, 11/20/2045 | | | 387,310 | |
| 207,236 | | | 4.00%, 03/20/2047 | | | 216,315 | |
| 60,414 | | | 4.50%, 05/15/2039 | | | 64,765 | |
| 218,093 | | | 4.50%, 09/15/2039 | | | 235,123 | |
| 15,515 | | | 4.50%, 04/15/2040 | | | 16,343 | |
| 5,776 | | | 4.50%, 05/20/2040 | | | 6,126 | |
| 3,579 | | | 4.50%, 06/15/2040 | | | 3,767 | |
| 44,315 | | | 4.50%, 06/20/2040 | | | 47,002 | |
| 126,089 | | | 4.50%, 09/20/2040 | | | 133,769 | |
| 84,276 | | | 4.50%, 10/15/2040 | | | 89,247 | |
| 26,800 | | | 4.50%, 10/20/2040 | | | 28,425 | |
| 58,169 | | | 4.50%, 03/20/2041 | | | 61,696 | |
| 12,534 | | | 4.50%, 04/15/2041 | | | 13,355 | |
| 37,244 | | | 4.50%, 06/20/2041 | | | 39,471 | |
| 83,427 | | | 5.00%, 11/20/2035 | | | 90,696 | |
| 36,080 | | | 5.00%, 09/15/2039 | | | 38,976 | |
| 67,106 | | | 5.00%, 02/15/2040 | | | 72,770 | |
| 93,867 | | | 5.00%, 09/20/2040 | | | 102,890 | |
| 58,660 | | | 5.00%, 02/20/2041 | | | 63,761 | |
| 48,592 | | | 5.00%, 03/20/2041 | | | 52,852 | |
| 51,464 | | | 5.00%, 08/20/2041 | | | 56,006 | |
| 14,972 | | | 5.00%, 12/20/2041 | | | 16,274 | |
| 13,849 | | | 5.50%, 05/20/2038 | | | 15,142 | |
| 34,538 | | | 5.50%, 07/15/2038 | | | 37,944 | |
| 34,029 | | | 5.50%, 08/20/2041 | | | 37,349 | |
| 29,279 | | | 6.00%, 02/15/2036 | | | 32,735 | |
| 18,376 | | | 6.00%, 08/20/2041 | | | 20,877 | |
| | | | | | | | |
| | | | | | | 10,867,229 | |
| | | | | | | | |
| | | Tennessee Valley Authority - 0.1% | |
| 213,000 | | | 6.75%, 11/01/2025 | | | 275,679 | |
| | | | | | | | |
| | |
| | | | Total U.S. Government Agencies (cost $42,700,015) | | | 42,503,918 | |
| | | | | | | | |
|
U.S. GOVERNMENT SECURITIES - 18.4% | |
| | | U.S. Treasury Securities - 18.4% | | | |
| | | U.S. Treasury Bonds - 2.7% | | | |
| 1,160,000 | | | 2.50%, 02/15/2045 | | | 1,105,852 | |
| 4,435,000 | | | 2.50%, 02/15/2046 | | | 4,220,353 | |
| 325,000 | | | 2.75%, 08/15/2047 | | | 325,406 | |
| 276,000 | | | 3.13%, 11/15/2041 | | | 296,711 | |
| 980,000 | | | 3.13%, 02/15/2043 | | | 1,052,849 | |
| 400,000 | | | 3.50%, 02/15/2039 | | | 456,860 | |
| | | | | | | | |
| | | | | | | 7,458,031 | |
| | | | | | | | |
| | | U.S. Treasury Notes - 15.7% | | | |
| 5,400,000 | | | 1.13%, 02/28/2021 | | | 5,251,289 | |
| 1,300,000 | | | 1.25%, 11/30/2018 | | | 1,293,652 | |
| 4,000,000 | | | 1.38%, 03/31/2020 | | | 3,953,125 | |
| 1,300,000 | | | 1.50%, 10/31/2019 | | | 1,291,063 | |
| 7,820,000 | | | 1.63%, 06/30/2019 | | | 7,792,813 | |
| 3,350,000 | | | 1.63%, 05/15/2026 | | | 3,155,281 | |
| 7,688,000 | | | 1.75%, 05/15/2022 | | | 7,564,271 | |
| | | | | | | | |
Shares or Principal Amount | | Market Value(1) | |
U.S. GOVERNMENT SECURITIES - 18.4% - (continued) | |
| | | U.S. Treasury Securities - 18.4% - (continued) | |
| | | U.S. Treasury Notes - 15.7% - (continued) | |
$ | 1,350,000 | | | 2.00%, 02/15/2025 | | $ | 1,319,678 | |
| 4,700,000 | | | 2.00%, 11/15/2026 | | | 4,548,535 | |
| 315,000 | | | 2.13%, 05/15/2025 | | | 310,189 | |
| 500,000 | | | 2.25%, 11/15/2027 | | | 492,949 | |
| 2,910,000 | | | 2.75%, 11/15/2023 | | | 2,988,775 | |
| 2,825,000 | | | 2.75%, 02/15/2024 | | | 2,899,156 | |
| 2,215,000 | | | 3.13%, 05/15/2021 | | | 2,291,833 | |
| | | | | | | | |
| | | | | | | 45,152,609 | |
| | | | | | | | |
| | |
| | | | Total U.S. Government Securities (cost $53,007,654) | | | 52,610,640 | |
| | | | | | | | |
| | |
| | | | Total Long-Term investments - Excluding Purchased Options (cost $192,257,183) | | | 214,212,571 | |
| | | | | | | | |
|
SHORT-TERM INVESTMENTS - 14.1% | |
| | | Repurchase Agreements - 0.4% | | | |
| | | | RBC Capital Markets LLC TriParty Repurchase Agreement (dated 12/29/2017, repurchase price $1,191,179, collateralized by U.S. Treasury Bonds 2.25% - 8.88%, 2019 - 2046, U.S. Treasury Inflation Index Bond 0.75%, 2045, U.S. Treasury Inflation Index Note 0.38%, 2025, U.S. Treasury Notes 1.38% - 3.50%, 2020 - 2026, value of $1,211,487) | | | | |
| 1,191,000 | | | 1.35%, 01/02/2018 | | | 1,191,000 | |
| | | | | | | | |
| | |
| | | U.S. Government Agencies - 13.7% | | | |
| | | FHLB - 4.6% | | | |
| 13,000,000 | | | 1.25%, 01/19/2018(6) | | | 12,992,083 | |
| | | | | | | | |
| | | FHLMC - 4.5% | | | |
| 7,000,000 | | | 1.10%, 02/05/2018(6) | | | 6,991,271 | |
| 6,000,000 | | | 1.16%, 01/26/2018(6) | | | 5,994,840 | |
| | | | | | | | |
| | | | | | | 12,986,111 | |
| | | | | | | | |
| | | FNMA - 4.6% | | | |
| 8,000,000 | | | 1.09%, 01/08/2018(6) | | | 7,998,280 | |
| 5,000,000 | | | 1.23%, 02/12/2018(6) | | | 4,992,485 | |
| | | | | | | | |
| | | | | | | 12,990,765 | |
| | | | | | | | |
| | | | | | | 38,968,959 | |
| | | | | | | | |
| | |
| | | | Total Short-Term investments (cost $40,162,148) | | | 40,159,959 | |
| | | | | | | | |
| | | | | | | | | | | | |
| | | |
| | | | Total Investments Excluding Purchased Options (cost $232,419,331) | | | 89.0 | % | | $ | 254,372,530 | |
| | | |
| | | | Total Purchased Options (cost $39,981,719) | | | 4.8 | % | | | 13,601,314 | |
| | | | | | | | | | | | |
| | | |
| | | | Total Investments (cost $272,401,050) | | | 93.8 | % | | $ | 267,973,844 | |
| | | | Other Assets and Liabilities | | | 6.2 | % | | | 17,681,265 | |
| | | | | | | | | | | | |
| | | | Total Net Assets | | | 100.0 | % | | $ | 285,655,109 | |
| | | | | | | | | | | | |
The accompanying Notes are an integral part of these financial statements.
|
HIMCO VIT Portfolio Diversifier Fund |
Schedule of Investments – (continued)
December 31, 2017
Note: | Percentage of investments as shown is the ratio of the total market value to total net assets. |
| The Fund may refer to any one or more of the industry classifications used by one or more widely recognized market indices, ratings group indices and/or as defined by Fund management. Industry classifications may not be identical across all security types. |
| Equity industry classifications used in this report are the Global Industry Classification Standard (GICS®), which was developed by and is the exclusive property and service mark of MSCI, Inc. and S&P. |
| For Fund compliance purposes, the Fund may not use the same classification system shown in this report as these classifications are used for reporting ease. |
(1) | See Significant Accounting Policies of accompanying Notes to Financial Statements regarding valuation of securities. |
(2) | Non-income producing. |
(3) | Affiliated company as defined under Sections 2(a)(2) and 2(a)(3) of the Investment Company Act of 1940. Hartford Investment Management Company, the Fund’s adviser, is a wholly-owned subsidiary of The Hartford Financial Services Group, Inc. A summary of transactions for the year ended December 31, 2017 is as follows: |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Company | | Beginning Value At January 1, 2017 | | | Purchase Cost | | | Sales Proceeds | | | Realized Gain (Loss) | | | Unrealized Gain (Loss) | | | Ending Value At December 31, 2017 | | | Dividend Income | |
Hartford Financial Services Group, Inc. (The) | | $ | 81,100 | | | $ | — | | | $ | (29,337) | | | $ | 5,688 | | | $ | 5,695 | | | $ | 63,146 | | | $ | 1,224 | |
(4) | Variable or floating rate security, which interest rate adjusts periodically based on changes in current interest rates and prepayments on the underlying pool of assets. Rate shown is the rate in effect as of period end. |
(5) | Securities issued within terms of a private placement memorandum, exempt from registration under Rule 144A under the Securities Act of 1933, as amended, and may be sold only to qualified institutional buyers. Unless otherwise indicated, these holdings are determined to be liquid. At December 31, 2017, the aggregate value of these securities was $1,528,053, which represents 0.5% of total net assets. |
(6) | The interest rate disclosed for these securities represents the effective yield on the date of the acquisition. |
Futures Contracts Outstanding at December 31, 2017
| | | | | | | | | | | | | | | | | | | | |
Description | | Number of Contracts | | | Expiration Date | | | Notional Amount | | | Value | | | Unrealized Appreciation/ (Depreciation) | |
Short position contracts: | | | | | | | | | | | | | | | | | | | | |
S&P 500 (E-Mini) | | | (313 | ) | | | 03/16/2018 | | | | (41,188,559 | ) | | $ | (41,879,393) | | | $ | (690,834) | |
| Cash of $3,700,000 was pledged as initial margin deposit and collateral for the daily variation margin on open futures contracts at December 31, 2017. |
OTC Option Contracts Outstanding at December 31, 2017
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Description | | Counterparty | | | Risk Exposure Category | | | Exercise Price | | | Expiration Date | | | Number of Contracts | | | Market Value | | | Premiums Received/Paid by Fund(1) | | | Unrealized Appreciation Depreciation | |
Purchased option contracts: | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Put option contracts | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
S&P 500 Index Option | | | BCLY | | | | EQ | | | | 2,098 | | | | 11/02/21 | | | | 31,706 | | | $ | 4,533,819 | | | $ | 13,320,087 | | | $ | (8,786,268 | ) |
S&P 500 Index Option | | | CSI | | | | EQ | | | | 2,098 | | | | 11/02/21 | | | | 31,705 | | | | 4,533,676 | | | | 13,290,419 | | | | (8,756,743 | ) |
S&P 500 Index Option | | | JPM | | | | EQ | | | | 2,098 | | | | 11/02/21 | | | | 31,706 | | | | 4,533,819 | | | | 13,371,213 | | | | (8,837,394 | ) |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Total put option contracts | | | | | | | | | | | | | | | | 95,117 | | | $ | 13,601,314 | | | $ | 39,981,719 | | | $ | (26,380,405 | ) |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Total purchased option contracts | | | | | | | | | | | | 95,117 | | | $ | 13,601,314 | | | $ | 39,981,719 | | | $ | (26,380,405) | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
(1) | For purchased options, premiums are paid by the Fund, for written options, premiums are received. |
| The brokers deposited securities valued at $10,009,683 and cash of $4,920,000 with the custodian to serve as collateral for the options purchased by the Fund. The collateral is maintained in a segregated account at the custodian on behalf of the Fund. Since the brokers retain legal title to the securities, the securities are not considered assets of the Fund and are not included in the Statement of Assets and Liabilities. |
The accompanying Notes are an integral part of these financial statements.
|
HIMCO VIT Portfolio Diversifier Fund |
Schedule of Investments – (concluded)
December 31, 2017
| | |
GLOSSARY: (abbreviations used in preceding Schedule of Investments) |
| | |
|
Index Abbreviations: |
MSCI | | Morgan Stanley Capital International |
S&P | | Standard & Poor’s |
|
Other Abbreviations: |
EQ | | Equity |
ETF | | Exchange Traded Fund |
FFCB | | Federal Farm Credit Bank |
FHLB | | Federal Home Loan Bank |
FHLMC | | Federal Home Loan Mortgage Corp. |
FNMA | | Federal National Mortgage Association |
GNMA | | Government National Mortgage Association |
MTN | | Medium Term Note |
REIT | | Real Estate Investment Trust |
| | |
|
Municipal Abbreviations: |
DA | | Development Authority |
GO | | General Obligation |
|
Counterparty Abbreviations: |
BCLY | | Barclays Bank PLC |
CSI | | Credit Suisse International |
JPM | | JP Morgan Chase & Co. |
RBC | | RBC Dominion Securities |
Investment Valuation Hierarchy Level Summary at December 31, 2017
| | | | | | | | | | | | | | | | |
Description | | Total | | | Level 1(1) | | | Level 2(1) | | | Level 3(1) | |
Assets: | | | | | | | | | | | | | | | | |
Common Stocks(2) | | $ | 71,741,784 | | | $ | 71,741,784 | | | $ | — | | | $ | — | |
Exchange-Traded Funds | | | 891,629 | | | | 891,629 | | | | — | | | | — | |
Asset & Commercial Mortgage Backed Securities | | | 929,525 | | | | — | | | | 929,525 | | | | — | |
Corporate Bonds | | | 41,473,982 | | | | — | | | | 41,473,982 | | | | — | |
Foreign Government Obligations | | | 3,133,264 | | | | — | | | | 3,133,264 | | | | — | |
Municipal Bonds | | | 927,829 | | | | — | | | | 927,829 | | | | — | |
U.S. Government Agencies | | | 42,503,918 | | | | — | | | | 42,503,918 | | | | — | |
U.S. Government Securities | | | 52,610,640 | | | | 492,949 | | | | 52,117,691 | | | | — | |
Short-Term Investments | | | 40,159,959 | | | | — | | | | 40,159,959 | | | | — | |
Put Options Purchased | | | 13,601,314 | | | | — | | | | 13,601,314 | | | | — | |
| | | | | | | | | | | | | | | | |
Total | | $ | 267,973,844 | | | $ | 73,126,362 | | | $ | 194,847,482 | | | $ | — | |
| | | | | | | | | | | | | | | | |
Liabilities: | | | | | | | | | | | | | | | — | |
Futures(3) | | | (690,834 | ) | | | (690,834 | ) | | | — | | | | — | |
| | | | | | | | | | | | | | | | |
Total | | $ | (690,834 | ) | | $ | (690,834 | ) | | $ | — | | | $ | — | |
| | | | | | | | | | | | | | | | |
(1) | For the year ended December 31, 2017, investments valued at $2,405,370 were transferred from Leve1 1 to Level 2 due to a U.S. Treasury security that no longer represented the most recent issue and is exclusively traded in the secondary market. For the same time period investments valued at $125,438 were transferred from Level 3 to Level 2 due to securities that was previously valued using significant unobservable inputs but is now valued using observable inputs. |
(2) | Refer to the Schedule of Investments for further industry breakout. |
(3) | Derivative instruments (excluding purchased and written options, if applicable) are valued at the unrealized appreciation/depreciation on the investments. |
Note: | For purposes of reporting transfers between different hierarchy levels, both transfers in and out of each level, as applicable, are shown as if they occurred at the beginning of the period. |
| Level 3 investments held by the Fund at the beginning and/or end of the period in relation to net assets were not significant and accordingly, a reconciliation of Level 3 assets for the year ended December 31, 2017 is not presented. |
| None of the unobservable inputs for Level 3 assets, individually or collectively, had a material impact on the Fund. |
The accompanying Notes are an integral part of these financial statements.
|
HIMCO VIT Portfolio Diversifier Fund |
Statement of Assets and Liabilities
December 31, 2017
| | | | |
Assets: | |
Investments in unaffiliated securities, at market value (cost $272,354,474) | | $ | 267,910,698 | |
Investments in affiliated securities, at market value (cost $46,576) | | | 63,146 | |
Cash(1) | | | 16,936,290 | |
Receivables: | |
Investment securities sold | | | 778,560 | |
Dividends and interest | | | 994,188 | |
Variation margin on futures contracts | | | 151,805 | |
Other assets | | | 69,816 | |
| | | | |
Total assets | | | 286,904,503 | |
| | | | |
Liabilities: | |
Payables: | |
Investment securities purchased | | | 932,376 | |
Fund shares redeemed | | | 53,609 | |
Investment management fees | | | 113,430 | |
Distribution fees | | | 60,282 | |
Trustees fees | | | 396 | |
Accrued expenses | | | 89,301 | |
| | | | |
Total liabilities | | | 1,249,394 | |
| | | | |
Net assets | | $ | 285,655,109 | |
| | | | |
Summary of Net Assets: | |
Capital stock and paid-in-capital | | $ | 399,761,229 | |
Undistributed net investment income | | | 3,294,537 | |
Accumulated net realized loss | | | (112,282,617 | ) |
Unrealized depreciation of investments | | | (5,118,040 | ) |
| | | | |
Net assets | | $ | 285,655,109 | |
| | | | |
Class IB: Net asset value per share | | $ | 7.02 | |
| | | | |
Shares Outstanding | | | 40,686,681 | |
| | | | |
Net Assets | | $ | 285,655,109 | |
| | | | |
(1) | Cash of $3,700,000 was pledged as initial margin deposit and collateral for the daily variation margin on open futures contracts at December 31, 2017. |
The accompanying Notes are an integral part of these financial statements.
|
HIMCO VIT Portfolio Diversifier Fund |
Statement of Operations
For the Year Ended December 31, 2017
| | | | |
Investment Income: | |
Dividends from unaffiliated securities | | $ | 1,547,873 | |
Dividends from affiliated securities | | | 1,224 | |
Interest | | | 3,942,707 | |
Other Income | | | 205 | |
| | | | |
Total investment income, net | | | 5,492,009 | |
| | | | |
Expenses: | |
Investment management fees | | | 1,765,671 | |
Transfer agent fees | | | 4,683 | |
Distribution fees - Class IB | | | 735,696 | |
Custodian fees | | | 31,784 | |
Accounting service fees | | | 209,215 | |
Trustees fees | | | 38,949 | |
Audit fees | | | 36,187 | |
Printing fees | | | 32,445 | |
Legal fees | | | 33,395 | |
Insurance fees | | | 19,569 | |
Other expenses | | | 14,354 | |
| | | | |
Total expenses (before waivers) | | | 2,921,948 | |
| | | | |
Total waivers | | | (414,089 | ) |
| | | | |
Total expenses, net | | | 2,507,859 | |
| | | | |
Net Investment Income | | | 2,984,150 | |
| | | | |
Net Realized Gain (Loss) on Investments and Other Financial Instruments: | |
Net realized gain on investments in unaffiliated securities | | | 10,463,210 | |
Net realized gain on investments in affiliated securities | | | 5,688 | |
Net realized loss on futures | | | (9,431,476 | ) |
| | | | |
Net Realized Gain on Investments and Other Financial Instruments | | | 1,037,422 | |
| | | | |
Net Changes in Unrealized Appreciation (Depreciation) of Investments and Other Financial Instruments: | |
Net unrealized appreciation of investments | | | 4,606,374 | |
Net realized depreciation of purchased options | | | (18,021,732 | ) |
Net unrealized depreciation of futures contracts | | | (554,956 | ) |
| | | | |
Net Changes in Unrealized Depreciation of Investments and Other Financial Instruments | | | (13,970,314 | ) |
| | | | |
Net Realized and Unrealized Loss on Investments and Other Financial Instruments | | | (12,932,892 | ) |
| | | | |
Net Decrease in Net Assets Resulting from Operations | | $ | (9,948,742 | ) |
| | | | |
The accompanying Notes are an integral part of these financial statements.
|
HIMCO VIT Portfolio Diversifier Fund |
Statements of Changes in Net Assets
| | | | | | | | |
| | For the Year Ended December 31, 2017 | | | For the Year Ended December 31, 2016 | |
Operations: | |
Net investment income | | $ | 2,984,150 | | | $ | 2,537,220 | |
Net realized gain (loss) on investments and other financial instruments | | | 1,037,422 | | | | (18,732,372 | ) |
Net unrealized appreciation (depreciation) of investments and other financial instruments | | | (13,970,314 | ) | | | 2,238,371 | |
| | | | | | | | |
Net Decrease in Net Assets Resulting from Operations | | | (9,948,742 | ) | | | (13,956,781 | ) |
| | | | | | | | |
Distributions to Shareholders: | |
From net investment income | |
Class IB | | | (3,015,178 | ) | | | — | |
| | | | | | | | |
Total distributions | | | (3,015,178 | ) | | | — | |
| | | | | | | | |
Capital Share Transactions: | |
Class IB | |
Sold | | | 31,520,549 | | | | 54,100,898 | |
Issued on reinvestment of distributions | | | 3,015,178 | | | | — | |
Redeemed | | | (48,466,289 | ) | | | (72,733,609 | ) |
| | | | | | | | |
Total capital share transactions | | | (13,930,562 | ) | | | (18,632,711 | ) |
| | | | | | | | |
Net decrease from capital share transactions | | | (13,930,562 | ) | | | (18,632,711 | ) |
| | | | | | | | |
Net Decrease in Net Assets | | | (26,894,482 | ) | | | (32,589,492 | ) |
| | | | | | | | |
Net Assets: | |
Beginning of period | | | 312,549,591 | | | | 345,139,083 | |
| | | | | | | | |
End of period | | $ | 285,655,109 | | | $ | 312,549,591 | |
| | | | | | | | |
Undistributed net investment income | | $ | 3,294,537 | | | $ | 2,927,233 | |
| | | | | | | | |
Shares: | |
Class IB | |
Sold | | | 4,416,644 | | | | 7,156,098 | |
Issued on reinvestment of distributions | | | 423,480 | | | | — | |
Redeemed | | | (6,760,753 | ) | | | (9,439,893 | ) |
| | | | | | | | |
Total share activity | | | (1,920,629 | ) | | | (2,283,795 | ) |
| | | | | | | | |
The accompanying Notes are an integral part of these financial statements.
|
HIMCO VIT Portfolio Diversifier Fund |
Notes to Financial Statements
December 31, 2017
HIMCO Variable Insurance Trust (the “Trust”) is an open-end registered management investment company. The Trust is organized under the laws of the State of Delaware and is registered with the Securities and Exchange Commission (“SEC”) under the Investment Company Act of 1940, as amended (“1940 Act”).
HIMCO VIT Portfolio Diversifier Fund (the “Fund”) serves as an underlying investment option for certain variable annuity separate accounts of Hartford Life Insurance Company (“Hartford Life”) and its affiliates and Forethought Life Insurance Company (“Forethought”). The Fund’s shares are available only to separate accounts of Hartford Life and its affiliates and Forethought who have elected a guaranteed benefit rider subject to an allocation requiring investment in the Fund.
The Fund is a series of the Trust. The Fund is the successor of a series of Hartford Series Fund, Inc. (the “Hartford Portfolio Diversifier HLS Fund”). The reorganization of the Hartford Portfolio Diversifier HLS Fund with and into the Fund occurred on October 20, 2014. All information regarding and references to periods prior to October 20, 2014 relate to the Hartford Portfolio Diversifier HLS Fund. The Fund is a diversified open-end management investment company and applies specialized accounting and reporting under Accounting Standards Codification Topic 946, Financial Services – Investment Companies. The Fund is authorized to issue an unlimited number of shares.
Class IB shares of the Fund are offered at the per share net asset value (“NAV”) without a sales charge and are subject to distribution and service fees charged pursuant to a distribution plan (the “Distribution Plan”) approved by the Board of Trustees in accordance with Rule 12b-1 under the 1940 Act and the requirements of the applicable market conduct rules of the Financial Industry Regulatory Authority concerning asset-based sales charges.
2. | Significant Accounting Policies: |
The following is a summary of significant accounting policies followed by the Fund in the preparation of its financial statements, which are in accordance with United States Generally Accepted Accounting Principles (“U.S. GAAP”). The preparation of financial statements in accordance with U.S. GAAP may require management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of increases and decreases in net assets resulting from operations during the reporting period. Actual results could differ from those estimates.
| a) | Determination of Net Asset Value – The NAV per share is determined for the Fund’s shares as of the close of regular trading on the New York Stock Exchange (the “Exchange”) (normally 4:00 p.m. Eastern Time) (the “NYSE Close”) on each day that the Exchange is open (“Valuation Date”). If the Exchange is closed due to weather or other extraordinary circumstances on a day it would typically be open for business, the Fund will treat such day as a typical business day and accept purchase and redemption orders and calculate the Fund’s NAV as of 4:00 p.m. Eastern Time. The NAV for each share is determined by dividing the value of the Fund’s net assets by the number of shares outstanding. For any day where, due to technical or other issues, trading is halted before the scheduled close of the Exchange, and not as part of a trading halt that is effected on a market-wide basis, the Fund may elect to continue to treat the Valuation Date as occurring at the time of the schedule close of the Exchange. Information that becomes known to the Fund after the NAV has been calculated on a particular day will not generally be used to retroactively adjust the NAV determined earlier that day. |
| b) | Investment Valuation and Fair Value Measurements – For purposes of calculating the NAV, portfolio securities and other assets held in the Fund’s portfolio for which market prices are readily available are valued at market value. Market value is generally determined on the basis of last reported sales prices or official close price. If no sales were reported, market value is based on prices obtained from independent pricing services, a quotation reporting system or established market makers. If market prices are not readily available or are deemed unreliable, the Fund will use the fair value of the security or other instrument as determined in good faith under policies and procedures established by and under the supervision of the Board of Trustees. Market prices are considered not readily available where there is an absence of current or reliable market-based data (e.g., trade information or broker quotes), including where events occur after the close of the relevant market, but prior to the NYSE Close that materially affect the values of the Fund’s portfolio holdings or assets. In addition, market prices are considered not readily available when, due to extraordinary circumstances, the exchanges or markets on which the securities or other instruments trade do not open for trading for |
|
HIMCO VIT Portfolio Diversifier Fund |
Notes to Financial Statements – (continued)
December 31, 2017
| the entire day and no other market prices are available. Securities and other instruments that are primarily traded on foreign markets may trade on days that are not business days of the Fund. The value of the foreign securities or other instruments in which the Fund invests may change on days when a shareholder will not be able to purchase or redeem shares of the Fund. Fair value pricing is subjective in nature and the use of fair value pricing by the Fund may cause the NAV of its shares to differ significantly from the NAV that would have been calculated using market prices at the close of the exchange on which a portfolio holding is primarily traded. There can be no assurance that the Fund could obtain the fair value assigned to an investment if the Fund were to sell the investment at approximately the time at which the Fund determines its NAV. |
Fixed income securities, including those with a remaining maturity of less than sixty (60 days), and non-exchange traded derivatives held by the Fund are valued in accordance with procedures established by the Board of Trustees. Such investments are normally valued on the basis of quotes obtained from independent pricing services or brokers and dealers. Prices obtained from independent pricing services use information provided by market makers or estimates of market values obtained from yield data relating to investments or securities with similar characteristics. Senior floating rate interests generally trade in over-the-counter (“OTC”) markets and are priced through an independent pricing service utilizing independent market quotations from loan dealers or financial institutions. Generally, the Fund may use fair valuation in regard to fixed income positions when the Fund holds defaulted or distressed investments or investments in a company in which a reorganization is pending. If pricing services do not provide a price for short term investments maturing in 60 days or less, such investments are generally valued at amortized cost if their original term to maturity was 60 days or less, or by amortizing their value on the 61st day prior to maturity, if the original term exceeded 60 days.
If pricing services do not provide a price for short term investments maturing in 60 days or less, such investments are generally valued at amortized cost if their original term to maturity was 60 days or less, or by amortizing their value on the 61st day prior to maturity, if the original term exceeded 60 days.
Exchange traded futures, options and options on futures are valued in accordance with procedures established by the Board of Trustees. Such instruments are normally valued on the basis of quotes obtained from independent pricing services. Prices obtained from independent pricing services use most recent settlement prices and/or bid and ask prices for futures; and last sale prices and bid and ask prices for options and options on futures. If pricing services are not able to provide prices for futures, such instruments will generally be valued at the most recent trade price as of the NYSE Close. If pricing services are not able to provide prices for options and options on futures, such instruments will generally be valued on the basis of quotes obtained from brokers, dealers or market makers. If the option is out of the money, within 30 days of expiration and no bid price is available, the option may be valued at zero. If such instruments do not trade on an exchange, values may be supplied by an independent pricing service using a formula or other objective method that may take into consideration the style, direction, expiration, strike price, notional value and volatility or other adjustments.
Investments in registered open-end investment companies are valued at the respective NAV of each such investment on the Valuation Date. Such open-end funds may use fair value pricing as disclosed in their prospectuses.
Financial instruments for which prices are not available from an independent pricing service may be valued using market quotations obtained from one or more dealers that make markets in the respective financial instrument in accordance with procedures established by the Board of Trustees.
U.S. GAAP defines fair value as the price that the Fund would receive to sell an asset or pay to transfer a liability in an orderly transaction between market participants at the measurement date. The U.S. GAAP fair value measurement standards require disclosure of a fair value hierarchy for each major category of assets and liabilities. Various inputs are used in determining the fair value of the Fund’s investments. These inputs are summarized into three broad hierarchy levels. This hierarchy is based on whether the valuation inputs are observable or unobservable. The determination of which category within the fair value hierarchy is appropriate for any given instrument is based on the lowest level of input that is significant to the fair value measurement. These levels are:
| • | | Level 1 – Inputs using (unadjusted) quoted prices in active markets or exchanges for identical assets and liabilities. Level 1 may include exchange traded instruments, such as domestic equities, some foreign equities, options, futures, investment companies, exchange traded funds, rights and warrants. |
|
HIMCO VIT Portfolio Diversifier Fund |
Notes to Financial Statements – (continued)
December 31, 2017
| • | | Level 2 – Observable inputs other than Level 1 prices, which may include, but are not limited to, quoted prices for similar assets or liabilities in markets that are active, quoted prices for identical or similar assets or liabilities in markets that are not active, inputs other than quoted prices that are observable for the assets or liabilities or other market corroborated inputs. Level 2 may include debt investments that are traded less frequently than exchange traded instruments and are valued using independent pricing services; foreign equities, which are principally traded on certain foreign markets and are adjusted daily pursuant to a fair value pricing service in order to reflect an adjustment for the factors occurring after the close of certain foreign markets but before the NYSE Close; senior floating rate interests, which are valued using an aggregate of dealer bids; short-term investments, which are valued at amortized cost; and swaps, which are valued based upon the terms of each swap contract. |
| • | | Level 3 – Significant unobservable inputs based on the best information available in the circumstances, to the extent observable inputs are not available. Level 3 may include financial instruments whose values are determined using indicative market quotes or require significant management judgment or estimation. These unobservable valuation inputs may include estimates for current yields, maturity/duration, prepayment speed, and indicative market quotes for comparable investments along with other assumptions relating to credit quality, collateral value, complexity of the investment structure, general market conditions and liquidity. This category may include investments where trading has been halted or there are certain restrictions on trading. While these investments are priced using unobservable inputs, the valuation of these investments reflects the best available data and management believes the prices are a reasonable representation of exit price. |
The procedures adopted by the Board of Trustees define how investments are to be valued, including the formation and activities of a Valuation Committee. The Valuation Committee has the overall responsibility for implementing the procedures adopted by the Board of Trustees, including the responsibility for determining the fair value of the Fund’s investments. The Valuation Committee is also responsible for determining in good faith the fair value of an investment when the value cannot be obtained from primary pricing services or alternative sources or if the valuation of an investment, as provided by the primary pricing service or alternative source, is believed not to reflect the investment’s fair value as of the Valuation Date.
The Valuation Committee is comprised of the Trust’s Chief Executive Officer, Treasurer, Chief Operating Officer, and Chief Legal Officer, or their designees, and other personnel of the investment manager subject to prior approval by the Board of Trustees. In addition, the Trust’s Chief Compliance Officer (“CCO”) shall designate a member of the compliance group to attend Valuation Committee meetings as a non-voting resource, to monitor for and provide guidance with respect to compliance with these procedures and to keep the Trust’s CCO regularly informed of pricing and Valuation Committee proceedings. Two members of the Valuation Committee or their designees, representing different departments, shall constitute a quorum for purposes of permitting the Committee to take action. The Valuation Committee will consider all relevant factors in determining an investment’s fair value, and may seek the advice of the Fund’s adviser, knowledgeable brokers, and legal counsel in making such determination.
At each quarterly meeting of the Board of Trustees, the Valuation Committee provides a written report that includes details of all fair-valued investments to the extent any are fair-valued, including the reason for the fair valuation, and an indication, when possible, of the accuracy of the valuation by disclosing the next available reliable public price quotation or the disposition price of such investments (the “look-back” review). The Board of Trustees then must consider for ratification all of the fair value determinations made during the previous quarter.
Valuation levels are not necessarily indicative of the risk associated with investing in such investments. Individual investments within any of the above mentioned asset classes may be assigned a different hierarchical level than those presented above, as individual circumstances dictate.
For additional information, refer to the Investment Valuation Hierarchy Level Summary included in the Schedule of Investments.
| c) | Investment Transactions and Investment Income – Investment transactions are recorded as of the trade date (the date the order to buy or sell is executed) for financial reporting purposes. Investments purchased or sold on a when-issued or delayed-delivery basis may be settled a month or more after the trade date. Realized gains and losses are determined on the basis of identified cost. |
|
HIMCO VIT Portfolio Diversifier Fund |
Notes to Financial Statements – (continued)
December 31, 2017
Dividend income from domestic securities is recorded on the ex-dividend date. Interest income, including amortization of premium, accretion of discounts and additional principal received in-kind in lieu of cash, is accrued on a daily basis. Paydown gains and losses on mortgage related and other asset backed securities are included in interest income in the Statement of Operations, as applicable.
| d) | Joint Trading Account – The Fund may invest cash balances into a joint trading account that may be invested in one or more repurchase agreements. |
| e) | Fund Share Valuation and Dividend Distributions to Shareholders – Orders for the Fund’s shares are executed in accordance with the investment instructions of the contract holders and plan participants. |
Orders for the purchase of the Fund’s shares received prior to the close of the Exchange on any day the Exchange is open for business are priced at the NAV determined as of the close of the Exchange. Orders received after the close of the Exchange, or on a day on which the Exchange and/or the Fund is not open for business, are priced at the next determined NAV.
Dividends are declared pursuant to a policy adopted by the Board of Trustees based upon the investment performance of the Fund. The policy of the Fund is to pay dividends from net investment income and to make distributions of realized gains, if any, at least once per year.
Distributions from net investment income, realized capital gains and capital are determined in accordance with federal income tax regulations, which may differ from U.S. GAAP with respect to character and timing. These differences may include, but are not limited to, losses deferred due to wash sale adjustments, foreign currency gains and losses, adjustments related to Passive Foreign Investment Companies (“PFICs”), Real Estate Investment Trusts (“REITs”), Regulated Investment Companies (“RICs”), certain derivatives and partnerships. Permanent book and federal income tax basis differences relating to shareholder distributions will result in reclassifications to certain of the Fund’s capital accounts (see Federal Income Taxes: Reclassification of Capital Accounts note).
3. | Securities and Other Investments: |
| a) | Repurchase Agreements and Reverse Repurchase Agreements – A repurchase agreement is an agreement by which a counterparty agrees to sell an investment and agrees to repurchase the investment sold from the buyer, the Fund, at a mutually agreed upon time and price. A reverse repurchase agreement is an agreement by which the Fund agrees to sell an investment and agrees to repurchase the investment sold from the buyer, the counterparty, at a mutually agreed upon time and price. During the period of the repurchase agreement, the counterparty will deposit cash and or securities in a third party custodial account to serve as collateral. At the time the Fund enters into a repurchase agreement, the value of the underlying collateral, including accrued interest, will be equal to or exceed the value of the repurchase agreement. Repurchase agreements expose the Fund to counterparty risk – that is, the risk that the counterparty will not fulfill its obligations. To minimize counterparty risk, the investments that serve to collateralize the repurchase agreement are held by the Fund’s custodian in book entry or physical form in the custodial account of the Fund or in a third party custodial account. Repurchase agreements are valued at cost plus accrued interest, which approximates fair value. Repurchase agreements have master netting arrangements which allow the Fund to offset amounts owed to a counterparty with amounts owed by the counterparty, including any collateral. Upon an event of default under a master repurchase agreement, the non-defaulting party may close out all transactions traded under such agreement and net amounts owed under each transaction to one net amount payable by one party to the other. Absent an event of default, the master repurchase agreement does not result in an offset of reported amounts of assets and liabilities in the Statement of Assets and Liabilities across transactions between the Fund and the applicable counterparty. The Fund, as shown on the Schedule of Investments, had outstanding repurchase agreements and related collateral as of December 31, 2017. |
| b) | Illiquid and Restricted Investments – The Fund is permitted to invest in illiquid investments in an amount up to 15% of its net assets. Illiquid investments are those that may not be sold or disposed of in the ordinary course of business within seven days at approximately the price used for such investments in determination of the Fund’s NAV. The Fund may not be able to sell illiquid investments when the investment manager considers it desirable to do so or may have to sell such investments at a price that is lower than the price that could be obtained if the investments were more liquid. A sale of |
|
HIMCO VIT Portfolio Diversifier Fund |
Notes to Financial Statements – (continued)
December 31, 2017
| illiquid investments may require more time and may result in higher dealer discounts and other selling expenses than does the sale of those that are liquid. Illiquid investments also may be more difficult to value due to the lack of reliable market quotations for such investments, and investments in them may have an adverse impact on the Fund’s NAV. The Fund may invest in certain restricted investments. Restricted investments may be sold in private placement transactions between issuers and their purchasers and may be neither listed on an exchange nor traded in other established markets. The Fund may also purchase investments that may have restrictions on transfer or resale (including Rule 144A securities and Regulation S securities). These securities may either be determined to be liquid or illiquid pursuant to policies and guidelines established by the Board of Trustees. The Fund did not hold illiquid and/or restricted investments as of December 31, 2017. |
| c) | Investments Purchased on a When-Issued or Delayed-Delivery Basis – Delivery and payment for investments that have been purchased by the Fund on a forward commitment, or when-issued or delayed-delivery basis, take place beyond the customary settlement period. The Fund may dispose of or renegotiate a delayed-delivery transaction after it is entered into, and may sell delayed-delivery investments before they are delivered, which may result in a realized gain or loss. During this period, such investments are subject to market fluctuations, and the Fund identifies investments segregated in its records with a value at least equal to the amount of the commitment. When-issued and delayed delivery investments and forward commitments involve the risk that the investment the Fund buys will lose value prior to its delivery. There are also risks that the investment will never be issued or that the other party to the transaction will not meet its obligation. If this occurs, the Fund loses both the investment opportunity for the assets it set aside to pay for the investment and any gain in the investment’s price. The Fund did not hold when-issued or delayed-delivery investments as of December 31, 2017. |
| d) | Mortgage Related and Other Asset Backed Securities – The Fund may invest in mortgage related and other asset backed securities. These securities include mortgage pass-through securities, collateralized mortgage obligations, commercial mortgage backed securities, stripped mortgage backed securities, asset backed securities, collateralized debt obligations and other securities that directly or indirectly represent a participation in, or are secured by and payable from, mortgage loans on real property. Mortgage related securities are created from pools of residential or commercial mortgage loans, including mortgage loans made by savings and loan institutions, mortgage bankers, commercial banks and others. Asset backed securities are created from many types of assets, including auto loans, credit card receivables, home equity loans, and student loans. These securities provide a monthly payment that consists of both interest and principal payments. Interest payments may be determined by fixed or adjustable rates. The rate of pre-payments on underlying mortgages will affect the price and volatility of a mortgage related security, and may have the effect of shortening or extending the effective duration of the security relative to what was anticipated at the time of purchase. The timely payment of principal and interest of certain mortgage related securities is guaranteed by the full faith and credit of the United States Government. Mortgage related and other asset backed securities created and guaranteed by non-governmental issuers, including government-sponsored corporations, may be supported by various forms of insurance or guarantees, but there can be no assurance that the private insurers or guarantors can meet their obligations under the insurance policies or guarantee arrangements. The Fund, as shown on the Schedule of Investments, had mortgage related and other asset backed securities as of December 31, 2017. |
4. | Financial Derivative Instruments: |
The following disclosures contain information on how and why the Fund uses derivative instruments, the credit-risk-related contingent features in certain derivative instruments, and how derivative instruments affect the Fund’s financial position and results of operations. The location and fair value amounts of these instruments in the Statement of Assets and Liabilities and the realized gains and losses and changes in unrealized gains and losses in the Statement of Operations, each categorized by type of derivative contract, are included in the following Additional Derivative Instrument Information footnote. The derivative instruments outstanding as of year-end are disclosed in the notes to the Schedule of Investments, if applicable. The amounts of realized gains and losses and changes in unrealized appreciation and depreciation on derivative instruments during the year are disclosed in the Statement of Operations.
| a) | Futures Contracts – The Fund may enter into futures contracts. A futures contract is an agreement between two parties to buy or sell an asset at a set price on a future date. The Fund uses futures contracts to manage or obtain exposure to the |
|
HIMCO VIT Portfolio Diversifier Fund |
Notes to Financial Statements – (continued)
December 31, 2017
| investment markets, commodities, or movements in interest rates and currency values. The primary risks associated with the use of futures contracts are the imperfect correlation between the change in market value of the investments held by the Fund and the prices of futures contracts and the possibility of an illiquid market. Upon entering into a futures contract, the Fund is required to deposit with a futures commission merchant (“FCM”) an amount of cash or U.S. Government or Agency Obligations in accordance with the initial margin requirements of the broker or exchange. Futures contracts are marked to market daily at the most recent settlement price reported by an exchange on which, over time, they are traded most extensively, and an appropriate payable or receivable for the change in value (“variation margin”) is recorded by the Fund. Gains or losses are recognized but not considered realized until the contracts expire or are closed. Futures contracts involve, to varying degrees, risk of loss in excess of the variation margin disclosed in the Statement of Assets and Liabilities; however, the Fund seeks to reduce this risk through the use of an FCM. The Fund, as shown on the Schedule of Investments, had outstanding futures contracts as of December 31, 2017. |
| b) | Options Contracts – An option contract is a contract sold by one party to another party that offers the buyer the right, but not the obligation, to buy (call) or sell (put) an investment or other financial asset at an agreed-upon price during a specific period of time or on a specific date. Option contracts are either privately negotiated in the OTC market (“OTC options”) or executed in a registered exchange (“exchange traded options). The Fund may write (sell) covered call and put options on futures, swaps (“swaptions”), securities, commodities or currencies. “Covered” means that so long as the Fund is obligated as the writer of an option, it will own either the underlying investments or currency or an option to purchase the same underlying investments or currency having an expiration date of the covered option and an exercise price equal to or less than the exercise price of the covered option, or will pledge cash or other liquid investments having a value equal to or greater than the fluctuating market value of the option investment or currency. Writing put options increases the Fund’s exposure to the underlying instrument. Writing call options decreases the Fund’s exposure to the underlying instrument. Premiums received from writing options that expire are treated as realized gains. Premiums received from writing options that are exercised or closed are added to the proceeds or offset amounts paid on the underlying futures, swap, investment or currency transaction to determine the realized gain or loss. The Fund as a writer of an option has no control over whether the underlying instrument may be sold (call) or purchased (put) and as a result bears the market risk of an unfavorable change in the price of the instrument underlying the written option. There is the risk the Fund may not be able to enter into a closing transaction because of an illiquid market. The Fund may also purchase put and call options. Purchasing call options increases the Fund’s exposure to the underlying instrument. Purchasing put options decreases the Fund’s exposure to the underlying instrument. The Fund pays a premium, which is included on the Fund’s Statement of Assets and Liabilities as an investment and is subsequently marked to market to reflect the current value of the option. Premiums paid for purchasing options that expire are treated as realized losses. Certain options may be purchased with premiums to be determined on a future date. The premiums for these options are based upon implied volatility parameters at specified terms. The risk associated with purchasing put and call options is generally limited to the premium paid. Premiums paid for purchasing options that are exercised or closed are added to the amounts paid or offset against the proceeds on the underlying investment transaction to determine the realized gain or loss. Entering into over-the-counter options also exposes the Fund to counterparty risk. Counterparty risk is the possibility that the counterparty to the agreements may default on its obligation to perform or disagree as to the meaning of the contractual terms in the agreements. The Fund, as shown on the Schedule of Investments, had outstanding purchased options as of December 31, 2017. The Fund did not hold written options contracts as of December 31, 2017. |
Additional Derivative Instrument Information:
Fair Value of Derivative Instruments in the Statement of Assets and Liabilities as of December 31, 2017:
| | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | Risk Exposure Category | |
| | Interest Rate Contracts | | | Foreign Exchange Contracts | | | Credit Contracts | | | Equity Contracts | | | Commodity Contracts | | | Other Contracts | | | Total | |
Assets: | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Investments in unaffiliated securities, at market value (purchased options) | | $ | — | | | $ | — | | | $ | — | | | $ | 13,601,314 | | | $ | — | | | $ | — | | | $ | 13,601,314 | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Total | | $ | — | | | $ | — | | | $ | — | | | $ | 13,601,314 | | | $ | — | | | $ | — | | | $ | 13,601,314 | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | |
|
HIMCO VIT Portfolio Diversifier Fund |
Notes to Financial Statements – (continued)
December 31, 2017
| | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | Risk Exposure Category | |
| | Interest Rate Contracts | | | Foreign Exchange Contracts | | | Credit Contracts | | | Equity Contracts | | | Commodity Contracts | | | Other Contracts | | | Total | |
Liabilities: | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Unrealized depreciation on futures(1) | | $ | — | | | $ | — | | | $ | — | | | $ | 690,834 | | | $ | — | | | $ | — | | | $ | 690,834 | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Total | | $ | — | | | $ | — | | | $ | — | | | $ | 690,834 | | | $ | — | | | $ | — | | | $ | 690,834 | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| (1) | Includes cumulative appreciation/depreciation on financial futures contracts as reported in the Schedule of Investments. Only current day’s variation margin is reported within the Statement of Assets and Liabilities. |
The volume of derivatives that is presented in the Schedule of Investments is consistent with the derivative activity during the year ended December 31, 2017.
The Effect of Derivative Instruments in the Statement of Operations for the year ended December 31, 2017:
| | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | Risk Exposure Category | |
| | Interest Rate Contracts | | | Foreign Exchange Contracts | | | Credit Contracts | | | Equity Contracts | | | Commodity Contracts | | | Other Contracts | | | Total | |
Realized Loss on Derivatives Recognized as a Result of Operations: | |
Net realized loss on futures | | $ | — | | | $ | — | | | $ | — | | | $ | (9,431,476 | ) | | $ | — | | | $ | — | | | $ | (9,431,476 | ) |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Total | | $ | — | | | $ | — | | | $ | — | | | $ | (9,431,476 | ) | | $ | — | | | $ | — | | | $ | (9,431,476 | ) |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | |
|
Net Change in Unrealized Appreciation (Depreciation) on Derivatives Recognized as a Result of Operations: | |
Net change in unrealized depreciation of investments in purchased options | | $ | — | | | $ | — | | | $ | — | | | $ | (18,021,732 | ) | | $ | — | | | $ | — | | | $ | (18,021,732 | ) |
Net change in unrealized depreciation of futures | | | — | | | | — | | | | — | | | | (554,956 | ) | | | — | | | | — | | | | (554,956 | ) |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Total | | $ | — | | | $ | — | | | $ | — | | | $ | (18,576,688 | ) | | $ | — | | | $ | — | | | $ | (18,576,688 | ) |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| c) | Balance Sheet Offsetting Information – Set forth below are tables which disclose both gross information and net information about instruments and transactions eligible for offset in the financial statements, and instruments and transactions that are subject to a master netting arrangement, as well as amounts related to margin, reflected as financial collateral (including cash collateral), held at clearing brokers, counterparties and the Fund’s custodian. The master netting arrangements allow the clearing brokers to net any collateral held in or on behalf of the Fund, or liabilities or payment obligations of the clearing brokers to the Fund, against any liabilities or payment obligations of the Fund to the clearing brokers. The Fund is required to deposit financial collateral (including cash collateral) at the Fund’s custodian on behalf of clearing brokers and counterparties to continually meet the original and maintenance requirements established by the clearing brokers and counterparties. Such requirements are specific to the respective clearing broker or counterparty. Certain master netting arrangements may not be enforceable in a bankruptcy. |
The following tables present the Fund’s derivative assets and liabilities, presented on a gross basis as no amounts are netted within the Statement of Assets and Liabilities, by counterparty net of amounts available for offset under a master netting agreement or similar agreement (“MNA”) and net of the related collateral received/pledged by the Fund as of December 31, 2017:
| | | | | | | | |
Derivative Financial Instruments: | | Assets | | | Liabilities | |
Futures contracts | | $ | — | | | $ | 690,834 | |
Purchased options | | | 13,601,314 | | | | — | |
| | | | | | | | |
Total gross amount of derivative assets and liabilities in the Statement of Assets and Liabilities | | | 13,601,314 | | | | 690,834 | |
| | | | | | | | |
Derivatives not subject to a MNA | | | — | | | | 690,834 | |
| | | | | | | | |
Total gross amount of assets and liabilities subject to MNA or similar agreements | | $ | 13,601,314 | | | $ | — | |
| | | | | | | | |
|
HIMCO VIT Portfolio Diversifier Fund |
Notes to Financial Statements – (continued)
December 31, 2017
| | | | | | | | | | | | | | | | | | | | |
| | Gross Amount of Assets | | | Financial Instruments and Derivatives Available for Offset | | | Non-cash Collateral Received* | | | Cash Collateral Received* | | | Net Amount of Assets | |
Counterparty | | | | | | | | | | | | | | | | | | | | |
Barclays Bank PLC | | $ | 4,533,819 | | | $ | — | | | $ | (4,533,819 | ) | | $ | — | | | $ | — | |
Credit Suisse International | | | 4,533,676 | | | | — | | | | — | | | | (4,533,676 | ) | | | — | |
JP Morgan Chase & Co. | | | 4,533,819 | | | | — | | | | (4,533,819 | ) | | | — | | | | — | |
| | | | | | | | | | | | | | | | | | | | |
Total subject to a master netting or similar arrangement | | $ | 13,601,314 | | | $ | — | | | $ | (9,067,638 | ) | | $ | (4,533,676 | ) | | $ | — | |
| | | | | | | | | | | | | | | | | | | | |
| * | In some instances, the actual collateral received and/or pledged may be more than the amount shown. |
Credit risk depends largely on the perceived financial health of bond issuers. In general, the credit rating is inversely related to the credit risk of the issuer. Higher rated bonds generally are deemed to have less credit risk, while lower or unrated bonds are deemed to have higher risk of default. The share price, yield and total return of a fund that holds securities with higher credit risk may be more volatile than those of a fund that holds bonds with lower credit risk. Similar to credit risk, the Fund may be exposed to counterparty risk, or the risk that an institution or other entity with which the Fund has unsettled or open transactions will default.
The Fund’s investments expose the Fund to various risks including, but not limited to, interest rate, prepayment, extension and equity risks. Interest rate risk is the risk that fixed income securities will decline in value because of changes in interest rates. As nominal interest rates rise, the values of certain fixed income securities held by the Fund are likely to decrease. A nominal interest rate can be described as the sum of a real interest rate and an expected inflation rate. Fixed income securities with longer durations tend to be more sensitive to changes in interest rates, usually making them more volatile than securities with shorter durations. Duration is useful primarily as a measure of the sensitivity of a fixed income security’s market price to interest rate (i.e., yield) movements. Rising interest rates may cause prepayments to occur at a slower than expected rate, thereby effectively lengthening the maturity of the security and making the security more sensitive to interest rate changes. Prepayment and extension risk are major risks of mortgage backed securities and certain asset backed securities. For certain asset backed securities, the actual maturity may be less than the stated maturity shown in the Schedule of Investments, if applicable. As a result, the timing of income recognition relating to these securities may vary based upon the actual maturity.
The market values of equity securities, such as common stocks and preferred stocks, or equity related investments, such as futures and options, may decline due to general market conditions which are not specifically related to a particular company, such as real or perceived adverse economic conditions, changes in the general outlook for corporate earnings, changes in interest or currency rates or adverse investor sentiment generally. The market value of equity securities may also decline due to factors which affect a particular industry or industries, such as labor shortages or increased production costs and competitive conditions within an industry. Equity securities and equity related investments generally have greater market price volatility than fixed income securities.
| a) | Federal Income Taxes – For federal income tax purposes, the Fund intends to continue to qualify as a RIC under Subchapter M of the Internal Revenue Code of 1986, as amended (“IRC”), by distributing substantially all of its taxable net investment income and net realized capital gains to its shareholders and otherwise complying with the requirements of the IRC. The Fund distributed substantially all of its income and capital gains in prior years, if applicable, and intends to distribute substantially all of its income and capital gains prior to the next fiscal year-end. Accordingly, no provision for federal income or excise taxes has been made in the accompanying financial statements. Distributions from short-term capital gains are treated as ordinary income distributions for federal income tax purposes. |
| b) | Net Investment Income (Loss), Net Realized Gains (Losses) and Distributions – Net investment income (loss) and net realized gains (losses) may differ for financial statement and tax purposes primarily because of losses deferred due to wash sale adjustments, paydown gain/loss, adjustments related to certain corporate actions, REITs, RICs and certain derivatives. The 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. Also, due to the timing of dividend |
|
HIMCO VIT Portfolio Diversifier Fund |
Notes to Financial Statements – (continued)
December 31, 2017
| distributions, the fiscal year in which amounts are distributed may differ from the year that the income or realized gains (losses) were recorded by the Fund. |
| c) | Distributions and Components of Distributable Earnings – The tax character of distributions paid by the Fund for the periods indicated is as follows (as adjusted for dividends payable, if applicable): |
| | | | | | | | |
| | For the Year Ended December 31, 2017 | | | For the Year Ended December 31, 2016 | |
Ordinary Income | | $ | 3,015,178 | | | $ | — | |
As of December 31, 2017, the Fund’s components of distributable earnings (deficit) on a tax basis were as follows:
| | | | |
| | Amount | |
Undistributed Ordinary Income | | $ | 3,294,537 | |
Undistributed Long-Term Capital Gain | | | — | |
Capital Loss Carryforward | | | (89,064,436 | ) |
Unrealized Appreciation (Depreciation)(1) | | | (28,336,221 | ) |
| | | | |
Total Accumulated Earnings (Deficit) | | $ | (114,106,120 | ) |
| | | | |
| (1) | Differences between book-basis and tax-basis unrealized appreciation (depreciation) may be attributable to the losses deferred due to wash sale adjustments, adjustments related to REITs, RICs, certain derivatives and corporate actions. |
| d) | Reclassification of Capital Accounts – The Fund may record reclassifications in its capital accounts. These reclassifications have no impact on the total net assets of the Fund. The reclassifications are a result of permanent differences between U.S. GAAP and tax accounting for such items as paydown gain/loss and certain distributions from REITs after gain/loss. Adjustments are made to reflect the impact these items have on current and future distributions to shareholders. Therefore, the source of the Fund’s distributions may be shown in the accompanying Statements of Changes in Net Assets as from undistributed net investment income, from accumulated net realized loss on investments or from capital depending on the type of book and tax differences that exist. For the fiscal year ended December 31, 2017, the Fund recorded reclassifications to increase (decrease) the accounts listed below: |
| | | | |
| | Amount | |
Paid In Capital | | $ | (99,982 | ) |
Undistributed Net Investment Income | | | 398,332 | |
Accumulated Net Realized Loss | | | (298,350 | ) |
| e) | Capital Loss Carryforward – Under U.S. tax law, the Fund is permitted to carry forward capital losses for an unlimited period. Additionally, capital loss carryforwards retain their character as either short-term or long-term capital losses rather than being considered all short-term as permitted under prior regulation. |
At December 31, 2017 (tax-year-end), the Fund had capital loss carryforwards for U.S. federal income tax purposes as follows:
Capital loss carryforwards with no expiration:
| | | | |
| | Amount | |
Short-Term Capital Loss Carryforward | | $ | 12,269,358 | |
Long-Term Capital Loss Carryforward | | | 76,795,078 | |
| | | | |
Total | | $ | 89,064,436 | |
| | | | |
| f) | Federal Tax Cost – At December 31, 2017, the cost of securities (including derivatives) for federal income tax purposes was $296,310,065, and the aggregate gross unrealized appreciation and depreciation based on that cost were: |
| | | | |
| | Amount | |
Unrealized Appreciation | | $ | 24,653,260 | |
Unrealized Depreciation | | | (52,989,481 | ) |
| | | | |
Net Unrealized Depreciation | | $ | (28,336,221 | ) |
| | | | |
|
HIMCO VIT Portfolio Diversifier Fund |
Notes to Financial Statements – (continued)
December 31, 2017
| g) | Accounting for Uncertainty in Income Taxes – In accordance with U.S. GAAP, the Fund analyzes all open tax years, as defined by the statute of limitations, for all major jurisdictions. Generally, tax authorities can examine all tax returns filed for the last three years. The Fund does not have an examination in progress. |
The Fund has reviewed all open tax years and major jurisdictions and concluded that these financial reporting rules had no effect on the Fund’s financial position or results of operations. There is no tax liability resulting from unrecognized tax benefits relating to uncertain income tax positions taken or expected to be taken on the tax return for the fiscal year ended December 31, 2017. The Fund is also not aware of any tax positions for which it is reasonably possible that the total amounts of unrecognized tax benefits will significantly change in the next twelve months.
| a) | Investment Management Agreement – Hartford Investment Management Company (“Hartford Investment Management”) serves as the Fund’s investment manager pursuant to an Investment Management Agreement with the Trust. Hartford Investment Management is a wholly owned subsidiary of The Hartford Financial Services Group, Inc. (“The Hartford”). The investment manager provides day-to-day investment management services to the Fund and has overall investment supervisory responsibility for the Fund. In addition, the investment manager provides administrative personnel, services, equipment, facilities and office space for operation of the Fund. |
The schedule below reflects the rates of compensation as a percentage of the Fund’s average daily net assets paid to the investment manager for investment management services rendered as of December 31, 2017; the rates are accrued daily and paid monthly.
| | | | |
Average Daily Net Assets | | Annual Fee | |
On first $500 million | | | 0.60% | |
On next $500 million | | | 0.55% | |
On next $4 billion | | | 0.50% | |
On next $5 billion | | | 0.48% | |
Over $10 billion | | | 0.47% | |
| b) | Accounting Services Agreement – State Street Bank and Trust Company (“State Street Bank”) provides the Fund with accounting services pursuant to a fund accounting agreement by and between the Trust, on behalf of the Fund, and State Street Bank. The amount paid for accounting services can be found in the Statement of Operations. These fees are accrued daily and paid monthly. |
| c) | Operating Expenses – Allocable expenses incurred by the Trust are allocated to the Fund in proportion to the average daily net assets of the Fund, except where allocation of certain expenses is more fairly made directly to the Fund. |
Hartford Investment Management has contractually agreed to reimburse expenses (exclusive of taxes, interest expense, brokerage commissions, acquired fund fees and expenses and extraordinary expenses) to the extent necessary to maintain total annual operating expenses for the Class IB shares of the Fund at the annual rate of 0.85% of average daily net assets. This contractual arrangement will remain in effect until April 30, 2018, and shall renew automatically for one-year terms unless the investment manager provides written notice of termination prior to the start of the next term or upon approval of the Board of Trustees of the Fund.
| d) | Distribution Plan for Class IB Shares – HIMCO Distribution Services Company, a wholly owned subsidiary of The Hartford, serves as the principal underwriter and distributor of the Fund. The Trust, on behalf of the Fund, has adopted a |
| Distribution Plan pursuant to Rule 12b-1 of the 1940 Act for Class IB shares to compensate the distributor, from assets attributable to the services rendered and expenses borne in connection with activities primarily intended to result in the sale of the Class IB shares, subject to the review and approval of the Board of Trustees. |
The Distribution Plan provides that the Fund may pay annually up to 0.25% of the average daily net assets of the Fund attributable to its Class IB shares for activities primarily intended to result in the sale of Class IB shares. The Board of Trustees has the authority to suspend or reduce these payments at any point in time. Under the terms of the Distribution Plan and the principal underwriting agreement, the Fund is authorized to make payments monthly to the distributor that may be used to pay or reimburse entities, including insurance company affiliates of Hartford Investment Management,
|
HIMCO VIT Portfolio Diversifier Fund |
Notes to Financial Statements – (concluded)
December 31, 2017
providing distribution and shareholder servicing with respect to the Class IB shares for such entities’ fees or expenses incurred or paid in that regard. The distribution fee paid during the period can be found in the Statement of Operations. These fees are accrued daily and paid monthly or at such other intervals as the Board of Trustees may determine.
| e) | Transfer Agent Fees – State Street Bank provides transfer agent services to the Fund. The transfer agent is reimbursed for out-of-pocket expenses and other costs associated with the services it provides to the Fund, including costs invoiced by sub-contractors. Hartford Investment Management and its affiliates may pay, out of their own assets, compensation to third-party administrators for recordkeeping and other administrative services. The amount paid for transfer agent services can be found in the Statement of Operations. These fees are accrued daily and paid monthly. |
| f) | Trustee Fees – The Board of Trustees is responsible for oversight of the Fund. The Board of Trustees elects officers who are responsible for the day to day operations of the Fund. The Board of Trustees oversees the investment manager and the other principal service providers of the Fund. The Board of Trustees currently holds four regularly scheduled meetings throughout each year. In addition, the Board of Trustees may hold special meetings at other times either in person or by telephone. The Trustee fees paid during the period can be found in the Statement of Operations. |
8. | Investment Transactions: |
For the year ended December 31, 2017, the aggregate cost of purchases and proceeds from sales of investment securities (excluding short-term investments) was as follows:
| | | | | | | | | | | | |
| | Excluding Government Obligations | | | U.S. Government Obligations | | | Total | |
Cost of Purchases | | $ | 16,406,450 | | | $ | 32,278,750 | | | $ | 48,685,200 | |
Sales Proceeds | | | 49,366,282 | | | | 43,488,984 | | | | 92,855,266 | |
Under the Trust’s organizational documents, the Trust shall indemnify its officers and trustees to the full extent required or permitted under The Delaware Statutory Trust Act and the federal securities laws. In addition, the Trust, on behalf of the Fund, may enter into contracts that contain a variety of indemnifications. The Trust’s maximum exposure under these arrangements is unknown. However, as of the date of these financial statements the Trust has not had prior claims or losses pursuant to these contracts and expects the risk of loss to be remote.
Management has evaluated the need for disclosures and/or adjustments resulting from subsequent events through the date the Financial Statements were issued. Except as noted below, based on this evaluation, no adjustments to, or disclosures in, the Financial Statements were necessary as of December 31, 2017.
At a meeting held on December 1, 2017, the Board of Trustees unanimously approved an Agreement and Plan of Reorganization for the reorganization of the Fund with and into BlackRock Managed Volatility V.I. Fund, a series of BlackRock Variable Series Funds, Inc. (the “Reorganization”). The Board of Trustees has called for a special meeting of shareholders of the Fund to be held on April 4, 2018 for the purpose of seeking approval of the Agreement and Plan of Reorganization. If approved, the Reorganization is expected to occur on or about April 23, 2018, resulting in the termination, dissolution and complete liquidation of the Fund as a series of the Trust.
|
HIMCO VIT Portfolio Diversifier Fund |
Financial Highlights
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | — Selected Per-Share Data —(1) | | | — Ratios and Supplemental Data — | |
Class | | Net Asset Value at, Beginning of Period | | | Net Investment Income (Loss) | | | Net Realized and Unrealized Gain (Loss) on Investments | | | Total from Investment Operations | | | Distributions from Net Investment Income | | | Total Distributions | | | Net Asset Value End of Period | | | Total Return(2) | | | Net Assets at End of Period (000s) | | | Ratio of Expenses to Average Net Assets Before Adjust- ments(3) | | | Ratio of Expenses to Average Net Assets After Adjust- ments(3) | | | Ratio of Net Investment Income (Loss) to Average Net Assets | |
HIMCO VIT Portfolio Diversifier Fund | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
For the Year Ended December 31, 2017 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
IB | | $ | 7.34 | | | $ | 0.07 | | | $ | (0.32 | ) | | $ | (0.25 | ) | | $ | (0.07 | ) | | $ | (0.07 | ) | | $ | 7.02 | | | | (3.36 | )% | | $ | 285,655 | | | | 0.99 | % | | | 0.85 | % | | | 1.01 | % |
| | | | | | | |
For the Year Ended December 31, 2016 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
IB | | $ | 7.69 | | | $ | 0.06 | | | $ | (0.41 | ) | | $ | (0.35 | ) | | $ | — | | | $ | — | | | $ | 7.34 | | | | (4.55 | )% | | $ | 312,550 | | | | 0.97 | % | | | 0.85 | % | | | 0.78 | % |
| | | | | | | |
For the Year Ended December 31, 2015 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
IB | | $ | 7.91 | | | $ | 0.06 | | | $ | (0.21 | ) | | $ | (0.15 | ) | | $ | (0.07 | ) | | $ | (0.07 | ) | | $ | 7.69 | | | | (1.89 | )% | | $ | 345,139 | | | | 1.02 | % | | | 0.85 | % | | | 0.71 | % |
| | | | | | | |
For the Year Ended December 31, 2014 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
IB | | $ | 8.13 | | | $ | 0.05 | | | $ | (0.21 | ) | | $ | (0.16 | ) | | $ | (0.06 | ) | | $ | (0.06 | ) | | $ | 7.91 | | | | (2.03 | )% | | $ | 417,007 | | | | 0.90 | % | | | 0.85 | % | | | 0.59 | % |
| | | | | | | |
For the Year Ended December 31, 2013(4) | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
IB | | $ | 9.38 | | | $ | 0.03 | | | $ | (1.25 | ) | | $ | (1.22 | ) | | $ | (0.03 | ) | | $ | (0.03 | ) | | $ | 8.13 | | | | (12.96 | )% | | $ | 443,121 | | | | 0.89 | % | | | 0.85 | % | | | 0.29 | % |
(1) | Information presented relates to a share outstanding throughout the indicated period. Net investment income (loss) per share amounts are calculated based on average shares outstanding unless otherwise noted. |
(2) | The figures do not include sales charges or other fees which may be applied at the variable life insurance, variable annuity or qualified retirement plan product level. Any such additional sales charges or other fees would lower the Fund’s performance. |
(3) | Adjustments include waivers and reimbursements, if applicable. |
(4) | Financial highlights for the fiscal year ended December 31, 2013 were audited by the Predecessor Fund’s auditor. |
| | | | |
| | Portfolio Turnover Rate | |
For the Year Ended December 31, 2017 | | | 20 | % |
For the Year Ended December 31, 2016 | | | 52 | |
For the Year Ended December 31, 2015 | | | 34 | |
For the Year Ended December 31, 2014 | | | 33 | |
For the Year Ended December 31, 2013(1) | | | 31 | |
(1) | Financial highlights for the fiscal year ended December 31, 2013 were audited by the Predecessor Fund’s auditor. |
|
Report of Independent Registered Public Accounting Firm |
To the Board of Trustees of HIMCO Variable Insurance Trust and Shareholders of
HIMCO VIT Portfolio Diversifier Fund:
Opinion on the Financial Statements and Financial Highlights
We have audited the accompanying statement of assets and liabilities of HIMCO VIT Portfolio Diversifier Fund (the “Fund”), a series of the HIMCO Variable Insurance Trust, including the schedule of investments, as of December 31, 2017, the related statement of operations for the year then ended, the statements of changes in net assets for each of the two years in the period then ended, the financial highlights for each of the four years in the period then ended, and the related notes. The financial highlights for the year ended December 31, 2013 were audited by other auditors. Those auditors expressed an unqualified opinion on the financial highlights in their report dated February 17, 2014. In our opinion, the financial statements and financial highlights present fairly, in all material respects, the financial position of the Fund as of December 31, 2017, and the results of its operations for the year then ended, the changes in its 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, in conformity with accounting principles generally accepted in the United States of America.
Basis for Opinion
These financial statements and financial highlights are the responsibility of the Fund’s management. Our responsibility is to express an opinion on the Fund’s financial statements and financial highlights based on our audits. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (PCAOB) and are required to be independent with respect to the Fund in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.
We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements and financial highlights are free of material misstatement, whether due to error or fraud. The Fund is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. As part of our audits we are required to obtain an understanding of internal control over financial reporting but not for the purpose of expressing an opinion on the effectiveness of the Fund’s internal control over financial reporting. Accordingly, we express no such opinion.
Our audits included performing procedures to assess the risks of material misstatement of the financial statements and financial highlights, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements and financial highlights. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial statements and financial highlights. Our procedures included confirmation of securities owned as of December 31, 2017, by correspondence with the custodian and brokers; when replies were not received from brokers, we performed other auditing procedures. We believe that our audits provide a reasonable basis for our opinion.
As discussed in Note 10 to the financial statements, on December 1, 2017, the Board of Trustees unanimously approved an Agreement and Plan of Reorganization for the reorganization of the Fund with and into BlackRock Managed Volatility V.I. Fund, a series of BlackRock Variable Series Funds, Inc.
Deloitte & Touche LLP
Boston, Massachusetts
February 12, 2018
We have served as the auditor of one or more HIMCO Variable Insurance Trust investment companies since 2014.
|
HIMCO VIT Portfolio Diversifier Fund |
Trustees and Officers (Unaudited)
The Board of Trustees and officers of the Trust, their business addresses, principal occupations for at least the past five years and years of birth are listed in the tables below. The Board of Trustees (i) provides broad supervision over the affairs of the Trust and the Fund and (ii) elects officers who are responsible for the day-to-day operations of the Fund and the execution of policies formulated by the Board of Trustees. The first table below provides information about those trustees who are deemed not to be “interested persons” of the Trust, as that term is defined in the 1940 Act (i.e., “non-interested trustees”), while the second table below provides information about the Trust’s “interested” trustees and the Trust’s officers.
Non-Interested Trustees
| | | | | | | | | | |
Birth and Address | | Position Held with the Trust | | Term of Office* and Length of Time Served | | Principal Occupation(s) During Past 5 Years | | Number of Portfolios in Fund Complex Overseen by Trustee | | Other Directorships for Public Companies and Other Registered Investment Companies Held by Trustee |
PAUL BRAVERMAN (1949) c/o Hartford Investment Management Company One Hartford Plaza Hartford, CT 06155 | | Lead Independent Trustee | | Since 2014 | | Mr. Braverman is a private investor. He was a Partner and Chief Financial Officer of Wellington Management Company, LLP until 2007. He currently serves as a board member at Aesir Capital Management, Claren Road Asset Management, and Kieger (US) Ltd., investment advisory firms, and Leerink Swann Holdings, a healthcare investment bank. | | 2 | | Mr. Braverman currently serves as an Independent Trustee of GMO Trust (January 2009 to present) (54 funds overseen). |
| | | | | |
MARK OSTERHELD (1955) c/o Hartford Investment Management Company One Hartford Plaza Hartford, CT 06155 | | Trustee | | Since 2014 | | Mr. Osterheld is a private investor. Mr. Osterheld was Vice President of Treasury Oversight at Fidelity Investments until 2013. | | 2 | | None. |
| | | | | |
VANESSA WILSON (1959) c/o Hartford Investment Management Company One Hartford Plaza Hartford, CT 06155 | | Trustee | | Since 2014 | | Ms. Wilson is a private investor. Ms. Wilson served as Chief Financial Officer of Golden Seeds LLC, and of Golden Seeds Fund 2 GP until September 2015. Ms. Wilson worked for Deutsche Bank Securities until 2007, where she was a Managing Director and an equity research analyst. | | 2 | | None. |
* | Term of Office: Each trustee may serve until his or her successor is elected and qualifies. |
|
HIMCO VIT Portfolio Diversifier Fund |
Trustees and Officers (Unaudited) – (continued)
Officers and Interested Trustees
| | | | | | | | | | |
Name, Year of Birth and Address | | Position Held with the Trust | | Term of Office* and Length of Time Served | | Principal Occupation(s) During Past 5 Years | | Number of Portfolios in Fund Complex Overseen by Trustee | | Other Directorships Held by Trustee |
BRION JOHNSON** (1960) c/o Hartford Investment Management Company One Hartford Plaza Hartford, CT 06155 | | Trustee and Chairman of the Board | | Since 2014 | | Mr. Johnson currently serves as President of Hartford Investment Management and President of Hartford Life. From 2011 to 2012, Mr. Johnson served as a Managing Director, Chief Financial Officer and Head of Strategy and Development for Hartford Investment Management. Prior to joining Hartford Investment Management, Mr. Johnson served as Managing Member of Shoreline Arts and Publishing, LLC, a publishing and marketing business. From 2001 to 2008, Mr. Johnson was Executive Vice President and Head of Portfolio Management of PPM America, an affiliate of Prudential, plc. | | 2 | | None. |
| | | | | |
HUGH WHELAN** (1960) c/o Hartford Investment Management Company One Hartford Plaza Hartford, CT 06155 | | Trustee | | Since 2014 | | Mr. Whelan is a private investor. Mr. Whelan was the Head of Quantitative Equities and Interim President of Hartford Investment Management until 2012. Prior to joining Hartford Investment Management, Mr. Whelan was the Head of Quantitative Equities at ING Investment Management from 2001 to 2005. | | 2 | | None. |
| | | | | |
JEREMY BILLIEL† (1979) c/o Hartford Investment Management Company One Hartford Plaza Hartford, CT 06155 | | Treasurer | | Since 2018 | | Mr. Billiel currently serves as Vice President of Hartford Investment Management, overseeing all FP&A activities for the firm. From 2014 to 2017, he served as Assistant Treasurer of HIMCO Variable Insurance Trust. Prior to 2013, Mr. Billiel held various roles within The Hartford’s Personal Lines division and ING Investment management. | | N/A | | N/A |
| | | | | |
CHRISTOPHER CONNER (1970) c/o Hartford Investment Management Company One Hartford Plaza Hartford, CT 06155 | | Chief Compliance Officer | | Since 2016 | | Mr. Conner currently serves as Chief Compliance Officer of Hartford Life separate accounts and various Hartford entity broker-dealers. Prior to 2009, he served as Chief Compliance Officer and Counsel for Hartford Life Distributors, LLC. | | N/A | | N/A |
† | Mr. Billiel was appointed Treasurer of the Trust effective January 15, 2018. |
* | Term of Office: Each officer and Trustee may serve until his or her successor is elected and qualifies. |
** | “Interested person,” as defined in the 1940 Act, of the Company because of the person’s affiliation with, or equity ownership of, Hartford Investment Management or affiliated companies. |
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HIMCO VIT Portfolio Diversifier Fund |
Trustees and Officers (Unaudited) – (concluded)
| | | | | | | | | | |
Name, Year of Birth and Address | | Position Held with the Trust | | Term of Office* and Length of Time Served | | Principal Occupation(s) During Past 5 Years | | Number of Portfolios in Fund Complex Overseen by Trustee | | Other Directorships Held by Trustee |
| | | | | |
ERIC FAY (1962) c/o Hartford Investment Management Company One Hartford Plaza Hartford, CT 06155 | | Chief Operating Officer | | Since 2015 | | Mr. Fay currently serves as an Executive Vice President and Head of Business Operations of Hartford Investment Management. Prior to joining Hartford Investment Management, Mr. Fay served as Senior Vice President of Operations and Administration at The Hartford Bank. Before that Mr. Fay was a Senior Vice President and Chief Trust Officer for Guardian Life Insurance Company. | | N/A | | N/A |
| | | | | |
BRENDA PAGE (1965) c/o Hartford Investment Management Company One Hartford Plaza Hartford, CT 06155 | | Secretary and Chief Legal Officer | | Since 2014 | | Ms. Page currently serves as Vice President and Assistant General Counsel of The Hartford and Director of the Investment Law Group and Chief Compliance Officer of Hartford Investment Management. | | N/A | | N/A |
| | | | | |
MATTHEW POZNAR (1959) c/o Hartford Investment Management Company One Hartford Plaza Hartford, CT 06155 | | President | | Since 2014 | | Mr. Poznar currently serves as an Executive Vice President in the General Account Portfolio Management Group of Hartford Investment Management. | | N/A | | N/A |
* | Term of Office: Each officer and Trustee may serve until his or her successor is elected and qualifies. |
HOW TO OBTAIN A COPY OF THE FUND’S PROXY VOTING POLICIES AND VOTING RECORDS (UNAUDITED)
A description of the policies and procedures that the Fund uses to determine how to vote proxies relating to portfolio securities and information about how the Fund voted proxies relating to portfolio securities during the most recent twelve-month period ended June 30 are available (1) without charge, upon request, by calling 1-800-862-6668 and (2) on the SEC’s website at http://www.sec.gov. Additionally, a complete list of holdings is available on the Fund’s website at www.HVITFunds.com.
QUARTERLY PORTFOLIO HOLDINGS INFORMATION (UNAUDITED)
The Fund files a complete schedule of portfolio holdings with the SEC for the first and third quarters of each fiscal year on Form N-Q. The Fund’s Forms N-Q are available (1) without charge, upon request, by calling 1-800-862-6668 and (2) on the SEC’s website at http://www.sec.gov. The Form N-Q 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.
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HIMCO VIT Portfolio Diversifier Fund |
Expense Example (Unaudited)
Your Fund’s Expenses
As a shareholder of the Fund, you incur two types of costs: (1) transaction costs and (2) ongoing costs, including investment management fees, distribution and/or service (12b-1) fees, if any, and other fund expenses. This example is intended to help you understand your ongoing costs (in dollars) of investing in the Fund and to compare these costs with the ongoing costs of investing in other mutual funds. The example is based on an investment of $1,000 invested at the beginning of the period and held for the entire period of July 1, 2017 through December 31, 2017.
Actual Expenses
The first set of rows of the table below provides information about actual account values and actual expenses. You may use the information in this row, together with the amount you invested, to estimate the expenses that you paid over the period. Simply divide your account value by $1,000 (for example, an $8,600 account value divided by $1,000 = 8.6), then multiply the result by the number in the line under the heading entitled “Expenses Paid During Period” to estimate the expenses you paid on your account during this period.
Hypothetical Example for Comparison Purposes
The second set of rows of the table below provides information about hypothetical account values and hypothetical expenses based on the Fund’s actual expense ratio and an assumed rate of return of 5% per year before expenses, which is not the Fund’s actual return. The hypothetical account values and expenses may not be used to estimate the actual ending account balance or expenses you paid for the period. You may use this information to compare the ongoing costs of investing in the 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 fees which may be applied at the variable life insurance, variable annuity, or qualified retirement plan product level. Therefore, the second set of rows of 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 be higher.
| | | | | | | | | | | | | | | | |
| | Beginning Account Value 7/1/17 | | | Ending Account Value 12/31/17 | | | Expenses Paid During Period 7/1/17 - 12/31/17(1) | | | Net Annualized Expense Ratio(2) | |
Actual | | | | | | | | | | | | | | | | |
Class IB | | $ | 1,000 | | | $ | 987.90 | | | $ | 4.26 | | | | 0.85 | % |
Hypothetical | | | | | | | | | | | | | | | | |
Class IB | | $ | 1,000 | | | $ | 1,020.92 | | | $ | 4.33 | | | | 0.85 | % |
(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 184, the number of days in the most recent fiscal half-year, divided by 365, to reflect the one-half year period. |
(2) | Net annualized expense ratio is reflective of any applicable contractual fee waivers and/or expense reimbursements or voluntary fee waivers. Details regarding fee waivers can be found in Fees and Expenses of the accompanying Notes to Financial Statements. |
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HIMCO VIT Portfolio Diversifier Fund |
Approval of Investment Management Agreement (Unaudited)
Section 15(c) of the Investment Company Act of 1940, as amended (the “1940 Act”), requires that each mutual fund’s board of trustees, including a majority of those trustees who are not parties to the agreement or “interested persons” of the mutual fund, as defined in the 1940 Act (the “Independent Trustees”), annually review and consider the continuation of the mutual fund’s investment advisory agreement. At an in-person meeting held on December 1, 2017 (the “Meeting”), the Board of Trustees (the “Board”) of HIMCO Variable Insurance Trust (the “Trust”), including each of the Independent Trustees, unanimously voted to approve the continuation of the investment management agreement between Hartford Investment Management Company (“HIMCO” or the “Investment Manager”) and the Trust (the “Agreement”), on behalf of HIMCO VIT Portfolio Diversifier Fund (the “Fund”).
In connection with the renewal process and in advance of the Meeting, HIMCO provided information, including written responses and other supporting materials, to the Board in response to a request for information made on behalf of the Independent Trustees to facilitate the Board’s evaluation of the terms of the Agreement. In addition, the Board considered such additional information as it deemed reasonably necessary to evaluate the Agreement, which included information furnished to the Board at its meetings throughout the year, as well as information specifically prepared in connection with the annual approval of the Agreement at the Meeting. Information provided to the Board at its meetings throughout the year included, among other things, reports on Fund performance, legal, compliance and risk management matters, shareholder services and the other services provided to the Fund by the Investment Manager and its affiliates. The Board also considered the in-person presentations by Fund officers and representatives of HIMCO concerning the Agreement.
Broadridge Financial Solutions (“Broadridge”), an independent provider of investment company data, was retained to provide the Board with reports on how the Fund’s contractual management fees, actual management fees, other non-management fees, overall expense ratio and investment performance compared to those of comparable mutual funds with similar investment objectives.
In determining whether to continue the Agreement for the Fund, the members of the Board reviewed and evaluated information and factors they believed to be relevant and appropriate in light of the exercise of their reasonable business judgment. While individual members of the Board may have weighed certain factors differently, the Board’s determination to continue the Agreement was based on a comprehensive consideration of all information provided to the Board throughout the year and specifically with respect to the continuation of the Agreement. The Independent Trustees were also furnished with advice from their independent legal counsel, including advice regarding the legal standards applicable to their evaluation of the terms of the Agreement. Throughout the evaluation process, the Board was also assisted by counsel for the Fund. The Independent Trustees met in executive session with their independent counsel, outside the presence of the interested Trustees, Fund officers and representatives of HIMCO, to discuss the Agreement and the services provided by the Investment Manager and its affiliates. A more detailed summary of the important, but not necessarily all, factors the Board considered with respect to its approval of the Agreement is provided below.
In considering whether to approve the continuation of the Agreement, the Board noted that it unanimously approved (i) an Agreement and Plan of Reorganization that would reorganize the Fund with and into BlackRock Managed Volatility V.I. Fund, a series of BlackRock Variable Series Funds, Inc. (the “BlackRock Reorganization”); and (ii) a submission to shareholders regarding a proposal to approve the Agreement and Plan of Reorganization. The Board considered that if approved by shareholders of the Fund, the BlackRock Reorganization is expected to occur on or about April 23, 2018.
Nature, Extent and Quality of Services Provided by the Investment Manager
The Board requested and considered information concerning the nature, extent and quality of the services provided to the Fund by the Investment Manager. The Board considered, among other things, the terms of the Agreement and the range of services provided by the Investment Manager, including, among other things, managing the Fund’s assets, assuring compliance with the Fund’s investment objective and limitations and coordinating and overseeing the services of the Fund’s service providers. The Board further considered the Investment Manager’s qualifications, experience and personnel. In this regard, they considered personnel changes at HIMCO since the Board’s initial approval of the investment management agreement. Moreover, the Board considered HIMCO’s oversight of potential conflicts of interest between the Fund’s investments and those of other funds or accounts managed by the Fund’s portfolio management personnel.
The Board also requested and evaluated information concerning the Investment Manager’s regulatory and compliance environment. In this regard, the Board requested and reviewed information about the Investment Manager’s compliance policies
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HIMCO VIT Portfolio Diversifier Fund |
Approval of Investment Management Agreement (Unaudited) – (continued)
and procedures, compliance history, and a report from the Fund’s Chief Compliance Officer about the Investment Manager’s compliance with applicable laws and regulations. In addition, the Board noted that it had previously approved a compliance policy and procedures specific to the Fund to provide safeguards and controls designed to assure that the Fund is operated in accordance with its stated objectives and strategies, and not in a manner intended to inappropriately benefit the Investment Manager’s affiliates to the detriment of the Fund and its shareholders. The Board also noted the Investment Manager’s support of the Fund’s compliance control structure, particularly the resources devoted by the Investment Manager in support of the Fund’s obligations pursuant to Rule 38a-1 under the 1940 Act, as well as the efforts of HIMCO and its affiliates to combat cybersecurity risks and invest in business continuity planning.
Based on these considerations, the Board concluded that it was satisfied with the nature, extent and quality of the services provided to the Fund by HIMCO.
Performance of the Fund and the Investment Manager
The Board considered the investment performance of the Fund, noting that performance information for periods prior to October 20, 2014 related to that of a series of Hartford Series Fund, Inc. (the “Predecessor Fund”) which was reorganized into the Fund on that date (the “Reorganization”). The Board noted that, prior to the Reorganization, Hartford Funds Management Company, LLC served as the investment manager to the Predecessor Fund and HIMCO served as the sub-adviser to the Predecessor Fund. The Board reviewed the performance of the Fund over different time periods presented in the materials and evaluated HIMCO’s analysis of the Fund’s performance for these time periods. The Board considered information and materials provided to the Board by the Investment Manager concerning Fund performance, as well as information from Broadridge comparing the investment performance of the Fund to two broad-based market indices and universe of peer funds. The Board noted that the Fund’s performance was in the 4th quartile of its performance universe for the 1-, 3- and 5-year periods. The Board also noted that the Fund’s performance was below two broad-based market indices for the 1-, 3- and 5-year periods. The Board noted that the performance universe and the broad-based market indices are not good matches for the investment strategy of the Fund. The Board noted that the Fund’s performance was in line with its custom benchmark, noting that the Fund is designed to track its benchmark closely.
The Board considered the detailed investment analytics reports provided by HIMCO throughout the year. These reports include, among other things, information on the Fund’s returns, the Fund’s investment performance relative to benchmarks and various statistics concerning the Fund’s portfolio.
In light of all the considerations noted above, the Board concluded that it had continued confidence in HIMCO’s overall capabilities to manage the Fund.
Costs of the Services and Profitability of the Investment Manager
The Board reviewed information regarding HIMCO’s cost to provide investment management and related services to the Fund and HIMCO’s profitability, both overall and for the Fund, on a pre-tax basis without regard to distribution expenses. The Board also requested and reviewed information about the profitability to HIMCO and its affiliates from all services provided to the Fund and all aspects of their relationship with the Fund. The Board noted that the analysis provided to the Board reflected HIMCO’s projected expenses and profitability for the first six months of the 2018 fiscal year. The Board considered that the management of the Fund was unprofitable for HIMCO for the 2017 fiscal year. The Board also reviewed the fees paid to participating insurance companies from HIMCO’s assets, including any profits.
Based on these considerations, the Board concluded that the profits anticipated to be realized by the Investment Manager and its affiliates from their relationships with the Fund would not be excessive.
Comparison of Fees and Services Provided by the Investment Manager
The Board considered the comparative information that had been provided with respect to the services rendered to and management fees paid by the Fund to HIMCO and the total expense ratio of the Fund. In this regard, the Board reviewed information from Broadridge comparing the Fund’s contractual management fees, actual management fees and overall expense ratio relative to a group of peer funds. The Board also reviewed the different types of fees charged to the Fund, noting that there had been no changes to the management fees or expense reimbursement arrangements since they were originally approved in April 2014. The Board considered that the management fee for the Fund includes the provision by HIMCO of certain
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HIMCO VIT Portfolio Diversifier Fund |
Approval of Investment Management Agreement (Unaudited) – (continued)
administrative services to the Fund. The Board noted that the Fund’s contractual management fee, actual management fee and total expenses were below the median of its expense group. The Board noted that the Fund’s peer group is an imprecise match for the Fund’s investment strategy. The Board discussed the Fund’s fee levels, the Fund’s overall expense ratio and HIMCO’s profitability with respect to the Fund. The Board noted that the Fund has a contractual expense cap of 0.85%, which is scheduled to expire on April 30, 2018. The Board considered that HIMCO would voluntarily extend the expense cap through the closing date of the BlackRock Reorganization if completion of the BlackRock Reorganization were to occur after April 30, 2018.
While the Board recognized that comparisons between the Fund and peer funds are imprecise, given the different service levels and characteristics of mutual funds and the different business models and cost structures of the Investment Manager, the comparative information provided by Broadridge assisted the Board in evaluating the reasonableness of the Fund’s management fees and total operating expenses.
Based on these considerations, the Board concluded that the Fund’s fees and total operating expenses, in conjunction with the information about quality of services, profitability, economies of scale and other matters discussed, were reasonable in light of the services provided.
Economies of Scale
The Board considered information regarding the extent to which economies of scale may be realized as the Fund grows and whether fee levels reflect these economies of scale for the benefit of the Fund’s shareholders. The Board noted that the management fee schedule for the Fund includes breakpoints that are designed to reduce the management fee rates as the Fund’s average daily net assets increase. The Board recognized that a fund with assets beyond the highest breakpoint level will continue to benefit from economies of scale because additional assets are charged the lowest breakpoint fee resulting in lower overall effective management fee rates. The Board also recognized that a fee schedule that reaches a lower breakpoint quickly provides shareholders with the benefit of anticipated or potential economies of scale. The Board also noted that expense limitations that reduce the Fund’s expenses at all asset levels can have the same effect as breakpoints in sharing economies of scale with shareholders and provide protection from an increase in expenses if the Fund’s assets decline. After considering all of the information available to it, the Board concluded that it was satisfied with the extent to which economies of scale would be shared for the benefit of the Fund’s shareholders based on currently available information and the effective advisory fees and expense ratio for the Fund at its current and reasonably anticipated asset levels.
Other Benefits
The Board considered other benefits to the Investment Manager and its affiliates from their relationships with the Fund, including the role of the Fund in supporting the variable life insurance and variable annuity products offered by an affiliate of HIMCO. The Board noted that Hartford Life Insurance Company (“HLIC”), an affiliate of HIMCO, and its affiliates benefit from the Fund’s strategy of seeking to replicate the performance of the Portfolio Diversifier Index through a reduced need to hedge their obligations under certain guaranteed benefit riders (each, a “Rider”) in their general accounts, the reduced potential risk of loss, and the potential for additional assets garnered due to the appeal to investors of the Riders combined with a particular asset allocation model. The Board also noted, on the other hand, that investors benefit from the ability to elect the Rider at a comparatively reduced guarantee price (in light of the performance profile of the Fund) and on comparatively better terms, than would be available in the absence of the Fund, while maintaining a decreased possibility of downside risk as well as decreased volatility of an investor’s overall fund allocation. The Board considered the reports of the Investment Manager and the Fund’s Chief Compliance Officer that demonstrated that the Fund continues to be managed in the interests of contract holders, and not in the interests of HLIC to the detriment of contract holders.
The Board also considered that HIMCO Distribution Services Company (“HDSC”), an affiliate of HIMCO, serves as principal underwriter of the Fund. As principal underwriter, HDSC receives distribution and service (12b-1) fees from the Fund. The Board reviewed information on the profitability of HDSC and noted that HDSC pays all 12b-1 fees received from the Fund to participating insurance companies or their affiliated broker-dealers, including insurance companies affiliated with HIMCO.
* * * *
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HIMCO VIT Portfolio Diversifier Fund |
Approval of Investment Management Agreement (Unaudited) – (concluded)
Based upon its review of these various factors, among others, the Board, including all of the Independent Trustees, concluded that it is in the best interests of the Fund and its shareholders for the Board to approve the Agreement for an additional year. In reaching this decision, the Board did not assign relative weights to the factors discussed above or deem any one or group of them to be controlling in and of themselves.
THIS PRIVACY POLICY IS NOT PART OF THIS REPORT
Privacy Policy and Practices of The Hartford Financial Services Group, Inc. and its Affiliates
(herein called “we, our and us”)
This Privacy Policy applies to our United States Operations
We value your trust. We are committed to the responsible:
a) management;
b) use; and
c) protection;
of Personal Information.
This notice describes how we collect, disclose, and protect Personal Information.
We collect Personal Information to:
a) service your Transactions with us; and
b) support our business functions.
We may obtain Personal Information from:
a) You;
b) your Transactions with us; and
c) third parties such as a consumer-reporting agency.
Based on the type of product or service You apply for or get from us, Personal Information such as:
a) your name;
b) your address;
c) your income;
d) your payment; or
e) your credit history;
may be gathered from sources such as applications,
Transactions, and consumer reports.
To serve You and service our business, we may share certain Personal Information. We will share Personal Information, only as allowed by law, with affiliates such as:
a) our insurance companies;
b) our employee agents;
c) our brokerage firms; and
d) our administrators.
As allowed by law, we may share Personal Financial Information with our affiliates to:
a) market our products; or
b) market our services;
to You without providing You with an option to prevent these disclosures.
We may also share Personal Information, only as allowed by law, with unaffiliated third parties including:
a) independent agents;
b) brokerage firms;
c) insurance companies;
d) administrators; and
e) service providers;
who help us serve You and service our business.
When allowed by law, we may share certain Personal Financial Information with other unaffiliated third parties
who assist us by performing services or functions such as:
a) taking surveys;
b) marketing our products or services; or
c) offering financial products or services under a joint agreement between us and one or more financial institutions.
We, and third parties we partner with, may track some of the pages You visit through the use of:
a) cookies;
b) pixel tagging; or
c) other technologies;
and currently do not process or comply with any web browser’s “do not track” signal or similar mechanism that indicates a request to disable online tracking of individual users who visit our websites or use our services.
For more information, our Online Privacy Policy, which governs information we collect on our website and our affiliate websites, which is available at
Online Privacy Policy.
We will not sell or share your Personal Financial Information with anyone for purposes unrelated to our business functions without offering You the opportunity to:
a) “opt-out;” or
b) “opt-in;”
as required by law.
We only disclose Personal Health Information with:
a) your proper written authorization; or
b) as otherwise allowed or required by law.
Our employees have access to Personal Information in the course of doing their jobs, such as:
a) underwriting policies;
b) paying claims;
c) developing new products; or
d) advising customers of our products and services.
We use manual and electronic security procedures to maintain:
a) the confidentiality; and
b) the integrity of;
Personal Information that we have. We use these procedures to guard against unauthorized access.
Some techniques we use to protect Personal Information
include:
a) secured files;
b) user authentication;
c) encryption;
d) firewall technology; and
e) the use of detection software.
We are responsible for and must:
a) identify information to be protected;
b) provide an adequate level of protection for that data;
c) grant access to protected data only to those people who must use it in the performance of their job-related duties.
Employees who violate our privacy policies and procedures may be subject to discipline, which may include ending their employment with us.
We will continue to follow our Privacy Policy regarding Personal Information even when a business relationship no longer exists between us.
As used in this Privacy Notice:
Application means your request for our product or service.
Personal Financial Information means financial information such as:
a) credit history;
b) income;
c) financial benefits; or
d) policy or claim information.
Personal Financial Information may include Social Security Numbers, Driver’s license numbers, or other government-issued identification numbers, or credit, debit card, or bank account numbers.
Personal Health Information means health information such as:
a) your medical records; or
b) information about your illness, disability or injury.
Personal Information means information that identifies You personally and is not otherwise available to the public. It includes:
a) Personal Financial Information; and
b) Personal Health Information.
Transaction means your business dealings with us,
such as:
a) your Application;
b) your request for us to pay a claim; and
c) your request for us to take an action on your account.
You means an individual who has given us Personal Information in conjunction with:
a) asking about;
b) applying for; or
c) obtaining;
a financial product or service from us if the product or service is used mainly for personal, family, or household purposes.
This Customer Privacy Notice is being provided on behalf of The Hartford Financial Services Group, Inc. and its affiliates, to the extent required by the Gramm-Leach-Bliley Act and implementing regulations.
1stAGChoice, Inc.; Access CoverageCorp, Inc.; Access CoverageCorp Technologies, Inc.; American Maturity Life Insurance Company; Archway 60 R, LLC; Business Management Group, Inc.; DMS R, LLC; First State Insurance Company; Fountain Investors I LLC; Fountain Investors II LLC; Fountain Investors III LLC; Fountain Investors IV LLC; FP R, LLC (Delaware); FTC Resolution Company LLC; Hart Re Group L.L.C.; Hartford Accident and Indemnity Company; Hartford Administrative Services Company; Hartford Casualty General Agency, Inc.; Hartford Casualty Insurance Company; Hartford Financial Services, LLC; Hartford Fire General Agency, Inc.; Hartford Fire Insurance Company; Hartford Funds Distributors, LLC; Hartford Funds Management Company, LLC; Hartford Funds Management Group, Inc.; Hartford Group Benefits Holding Company; Hartford Holdings, Inc.; Hartford HLS Series Fund II, Inc.; Hartford Insurance Company of Illinois; Hartford Insurance Company of the Midwest; Hartford Insurance Company of the Southeast; Hartford Integrated Technologies, Inc.; Hartford International Life Reassurance Corporation; Hartford Investment Management Company; Hartford Life and Accident Insurance Company; Hartford Life and Annuity Insurance Company; Hartford Life Insurance Company; Hartford Life, Inc.; Hartford Life International Holding Company; Hartford Life Private Placement, LLC; Hartford Lloyd’s Corporation; Hartford Lloyd’s Insurance Company; Hartford of Texas General Agency, Inc.; Hartford Residual Market, L.C.C.; Hartford Securities Distribution Company, Inc.; Hartford Series Fund, Inc.; Hartford Specialty Insurance Services of Texas, LLC; Hartford Strategic Investments, LLC; Hartford Underwriters General Agency, Inc.; Hartford Underwriters Insurance Company; Hartford-Comprehensive Employee Benefit Service Company; HDC R, LLC .; Heritage Holdings, Inc.; HIMCO Distribution Services Company; HIMCO Variable Insurance Trust; HLA LLC; HL Investment Advisors, LLC; Horizon Management Group, LLC; HRA Brokerage Services, Inc.; Lanidex Class B, LLC; ; Lanidex R, LLC (Delaware); Lattice Strategies LLC; Maxum Casualty Insurance Company; Maxum Indemnity Company; Maxum Specialty Services Corporation; MPC Resolution Company LLC; New England Insurance Company; New England Reinsurance Corporation; Northern Homelands Company; Nutmeg Insurance Agency, Inc.; Nutmeg Insurance Company; Pacific Insurance Company, Limited; Property and Casualty Insurance Company of Hartford; Sentinel Insurance Company, Ltd.; Trumbull Flood Management, L.L.C.; Trumbull Insurance Company; Twin City Fire Insurance Company.
Revised March 2017

This report is prepared for the general information of contract owners and qualified retirement plan participants. It is not an offer to buy or sell an annuity contract or qualified retirement plan, fund or any security. It should not be used in connection with any offer, except in conjunction with the appropriate product prospectus (which contains all pertinent product information including the applicable sales, administrative and other charges) and the current prospectus and/or summary prospectus of the Fund available for investment thereunder.
The information cannot be used or relied upon for the purpose of avoiding IRS penalties. These materials are not intended to provide tax, accounting or legal advice. As with all matters of a tax or legal nature, you should consult your own tax or legal counsel for advice.
You should carefully consider investment objectives, risks, and charges and expenses of the HIMCO VIT Portfolio Diversifier Fund before investing. This and other information can be found in the Fund’s prospectus or summary prospectus, which can be obtained from your investment representative or from www.hvitfunds.com. Please read them carefully before investing.
Hartford Investment Management is an SEC-registered investment adviser. SEC registration does not imply a certain level of skill or training; nor does it imply that the SEC has sponsored, recommended, or otherwise approved of Hartford Investment Management.
Distributor: HIMCO Distribution Services Company, member FINRA, SIPC, a broker-dealer affiliated with Hartford Investment Management. Not FDIC Insured – No Bank Guarantee – May Lose Value
Item 2. Code of Ethics.
As of the end of the period covered by this report, the registrant has adopted, in addition to a code of ethics, a “Code of Ethics for Principal Executive Officer and Principal Financial Officer” that applies to the registrant’s principal executive officer and principal financial officer (for purposes of this paragraph, the “Code”). A copy of the Code is filed herewith and is available, without charge, upon request, by calling 860-297-6700. There have been no amendments, during the period covered by this report, to a provision of the Code that applies to the registrant’s principal executive officer or principal financial officer. The registrant has not granted any waivers, including an implicit waiver, from a provision of the Code that applies to the registrant’s principal executive officer or principal financial officer.
Item 3. Audit Committee Financial Expert.
The Board of Trustees of the registrant has designated Mark Osterheld as the audit committee financial expert for the registrant. Mr. Osterheld qualifies as “independent” pursuant to paragraph (a)(2) of Item 3 to Form N-CSR.
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: $262,000 for the fiscal year ended December 31, 2016; $136,000 for the fiscal year ended December 31, 2017. |
| (b) | Audit-Related Fees: Deloitte & Touche LLP (“D&T”), the registrant’s principal accountant, did not bill any fees to the registrant in 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. |
| (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 $28,825 for the fiscal year ended December 31, 2016 and $50,550 for the fiscal year ended December 31, 2017. Tax-related services are principally in connection with, but not limited to, general tax services, excise tax and Passive Foreign Investment Company (PFIC) analysis. |
| (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: $0 for the fiscal year ended December 31, 2016; $0 for the fiscal year ended December 31, 2017. |
| (e) | (1) The Pre-Approval Policies and Procedures (the “Policy”) adopted by the Audit Committee of the registrant sets forth the procedures pursuant to which services provided by the independent registered public accounting firm (the “Independent Auditor”) for the registrant may be pre-approved. The following are some main provisions from the Policy: |
| - | The Audit Committee must pre-approve all audit services and non-audit services that the Independent Auditor provides to the registrant. |
| - | The Audit Committee must pre-approve any engagement of the Independent Auditor to provide non-audit services to any service affiliate (which is defined to include any entity controlling, controlled by, or under common control with the investment adviser that provides ongoing services to the registrant) during the period of the Independent Auditor’s engagement to provide audit services to the registrant, if the non-audit services to the service affiliate directly impact the registrant’s operations and financial reporting. |
| - | The Audit Committee shall pre-approve certain non-audit services to the registrant and its service affiliates pursuant to procedures set forth in the Policy. |
| - | The Independent Auditor may not provide specified prohibited non-audit services set forth in the Policy to the registrant, the registrant’s investment adviser, the service affiliates or any other member of the investment company complex. |
(2) One hundred percent of the services described in items 4(b) through 4(d) were approved in accordance with the Audit Committee’s Pre-Approval Policy. As a result, none of such services was approved pursuant to paragraph (c) (7) (i) (c) of Rule 2-01 of Regulation S-X.
| (f) | None of the hours expended on the principal accountant’s engagement to audit the registrant’s financial statements for the year ended December 31, 2017, were attributed to work performed by persons other than the principal accountant’s full-time, permanent employees. |
| (g) | The aggregate non-audit fees billed by the registrant’s accountant for services rendered to the registrant, and rendered to the registrant’s investment adviser (not including any sub-adviser whose role is primarily portfolio management and is subcontracted with or overseen by another investment adviser), and any entity controlling, controlled by, or under common control with the adviser that provides ongoing services to the registrant for each of the last two fiscal years of the registrant were: Non-Audit Fees: $1,134,000 for the fiscal year ended December 31, 2016; $1,540,000 for the fiscal year ended December 31, 2017. |
| (h) | The registrant’s audit committee of the board of trustees has considered whether the provision of non-audit services that were 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 investment adviser that provides ongoing services to the registrant that were not pre-approved pursuant to paragraph (c)(7)(ii) of Rule 2-01 of Regulation S-X is compatible with maintaining the principal accountant’s independence. |
Item 5. Audit Committee of Listed Registrants
Not applicable
Item 6. Investments.
| (a) | The Schedule of Investments in securities of unaffiliated issuers as of the close of the reporting period is included as part of the annual report filed under Item 1 of this form. |
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.
Not applicable
Item 11. Controls and Procedures.
| (a) | The registrant’s principal executive and principal financial officers, or persons performing similar functions, have concluded that the registrant’s disclosure controls and procedures (as defined in Rule 30a-3(c) under the Investment Company Act of 1940, as amended (the “1940 Act”) (17 CFR 270.30a-3(c))) are generally effective to provide reasonable assurance, as of a date within 90 days of the filing date of the report that includes the disclosure required by this paragraph, based on their evaluation of these controls and procedures required by Rule 30a-3(b) under the 1940 Act (17 CFR 270.30a-3(b)) and Rules 13a-15(b) or 15d-15(b) under the Securities Exchange Act of 1934, as amended (17 CFR 240.13a-15(b) or 240.15d-15(b)). |
| (b) | There were no changes in the registrant’s internal control over financial reporting (as defined in Rule 30a-3(d) under the 1940 Act) that occurred during the 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) | Code of Ethics for Principal Executive Officer and Principal Financial Officer |
| (2) | (i) A separate certification for each principal executive officer and principal financial officer of the registrant as required by Rule 30a-2(a) under the Investment Company Act of 1940 (17 CFR 270.30a- 2(a)) |
| | (ii) The certification required by Section 906 of the Sarbanes-Oxley Act of 2002 |
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.
| | |
HIMCO Variable Insurance Trust |
| |
By: | | /s/ Matthew Poznar |
| | Matthew Poznar |
| | President |
| | February 12, 2018 |
Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment Company Act of 1940, this report has been signed below by the following persons on behalf of the registrant and in the capacities and on the dates indicated.
| | |
HIMCO Variable Insurance Trust |
| |
By: | | /s/ Matthew Poznar |
| | Matthew Poznar |
| | President |
| | February 12, 2018 |
| |
By: | | /s/ Jeremy Billiel |
| | Jeremy Billiel |
| | Treasurer |
| | February 12, 2018 |