MANAGEMENT INVESTMENT COMPANIES
(Address of principal executive offices) (Zip code)
1200 River Road
Suite 1000
Conshohocken, Pennsylvania 19428
(Name and address of agent for service)
Item 1. | Reports to Stockholders. |
June 30, 2007 (Unaudited)
Contents | ||
6 | Statement of Investments | |
11 | Statement of Assets and Liabilities | |
12 | Statement of Operations | |
13 | Statements of Changes in Net Assets | |
15 | Financial Highlights | |
17 | Notes to Financial Statements |
Statement Regarding Availability of Proxy Voting Record.
SAR-NAT (8/07) | ![]() |
Dear Fellow Shareholder:
Since I last wrote to you, our mutual funds have enjoyed another period of solid performance, and the corporate realignment that was in progress is now finished.
On May 1, 2007, Nationwide Financial Services, Inc. (NFS), completed its acquisition of the Philadelphia-based retail mutual fund operations of NWD Investment Management, Inc. (formerly, “Gartmore Global Investments, Inc.”), from Nationwide Corporation, a subsidiary of Nationwide Mutual Insurance Company. Effective that date, the acquired entities were renamed Nationwide Funds Group (NFG), and the Gartmore Funds were renamed the Nationwide Funds to better align with the Nationwide® brand. Although the corporate ownership and fund names have changed, I can assure you that NFG intends to maintain as much continuity as possible with the Funds and key personnel.
Thank you, shareholders, for approving the new investment advisory agreement that was required due to the change in corporate ownership. The new agreement is identical in all material respects to the original agreement that it replaces, with the exception of the section pertaining to the vote by the shareholders of the NVIT Mid Cap Growth Fund to approve NorthPointe Capital®, LLC (NorthPointe) as sub-adviser to that particular Fund.
Market Overview: January 1-June 30, 2007
Share prices in general were buoyed in part by better-than-expected first-quarter 2007 earnings and a flurry of mergers and acquisitions, many of these spurred by readily available funding from private equity firms. In June, investors grew more cautious amid surging crude oil prices, a sudden spike in long-term interest rates, and the meltdown of two hedge funds that had exposure to the subprime mortgage market. Looking abroad, a weak U.S. dollar aided foreign stocks, as reflected in the 11.09% advance of the Morgan Stanley Capital International Europe, Australasia and Far East (MSCI EAFE®) Index. Emerging market performance was particularly robust.
The bond market struggled during the first half of 2007. While short-term interest rates remained stable, reflecting the Federal Reserve Board’s decision in June to leave the target federal funds rate at 5.25%, longer-term rates climbed during the first half of 2007, depressing bond prices and forcing the Lehman Brothers® U.S. Aggregate Index to settle for a modest 0.97% return.
We at NFG thank you for your understanding and cooperation throughout our recent transition period. We emerge from this period energized for the future, and we look forward to serving your investment needs for a long time to come.
Nationwide Funds Group
PAST PERFORMANCE IS NO GUARANTEE OF FUTURE RESULTS.
Nationwide Funds are advised by Nationwide Fund Advisors (NFA). NFA is a wholly-owned subsidiary of Nationwide Financial Services. Nationwide Financial Services is a wholly-owned subsidiary of Nationwide Corporation. All of the common stock of Nationwide Corporation is held by Nationwide Mutual (95.2%) and Nationwide Mutual Fire Insurance Company (4.8%), each of which is a mutual company owned by its policyholders.
Nationwide Funds Group (NFG) is the mutual fund arm of Nationwide Financial Services (NYSE: NFS). Based in Conshohocken, Pa., a suburb of Philadelphia, NFG is comprised of Nationwide Fund Advisors, Nationwide Fund Distributors, LLC, and Nationwide Fund Management, LLC. Together, these provide advisory, distribution, and administration services respectively to the Nationwide Funds, and manage more than $43.5 billion in assets as of June 30, 2007, of which more than $12 billion are in “fund of funds” designed to provide asset allocation across several types of investments and asset classes.
Lehman Brothers (LB) U.S. Aggregate Index: An unmanaged, market value-weighted index of investment-grade, fixed-rate debt issues (including government, corporate, asset-backed, and mortgage-backed securities with maturities of one year or more) that is generally representative of the bond market as a whole.
Morgan Stanley Capital International Europe, Australasia and Far East (MSCI EAFE®) Index: An unmanaged, free float-adjusted, market capitalization-weighted index that is designed to measure the performance of stocks in developed markets outside the United States and Canada.
Standard & Poor’s 500® (S&P 500) Index: An unmanaged, market capitalization-weighted index of 500 widely held stocks of large-cap U.S. companies that gives a broad look at how the stock prices of those companies have performed.
Views expressed within are those of Nationwide Funds Group as of the date noted, are subject to change at any time, and may not come to pass.
This report is for informational purposes only, and is not intended as an offer or recommendation with respect to the purchase or sale of any security, option, future, or other derivatives in such securities.
Investing in mutual funds involves risk, including possible loss of principal.
Investors should carefully consider a fund’s investment objectives, risks, fees, charges, and expenses before investing any money. To obtain this and other fund information, please call 800-848-0920 to request a prospectus, or download a prospectus at www.nationwidefunds.com. Please read the prospectus carefully before investing any money.
Nationwide Funds distributed by Nationwide Fund Distributors LLC (formerly Gartmore Distribution Services, Inc.), Member NASD. 1200 River Road, Suite 1000, Conshohocken, Pa. 19428.
As a shareholder of the Fund, you incur two types of costs: (1) transaction costs, including sales charges (loads) paid on purchase payments and redemption fees; and (2) ongoing costs, including investment advisory fees, administration fees, distribution fees and other Fund expenses. The examples below are 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. Per SEC requirements, the examples assume that you had a $1,000 investment in the Class at the beginning of the reporting period, January 1, 2007, and continued to hold your shares at the end of the reporting period, June 30, 2007.
Actual Expenses
Hypothetical Example for Comparison Purposes
Please note that the expenses shown in the table are meant to highlight your ongoing costs only and do not reflect any transaction costs, such as sales charges (loads) or redemption fees. Therefore, the second line for each Class in 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 transaction costs were included, your costs would have been higher. The examples also assume all dividends and distributions have been reinvested.
Schedule of Shareholder Expenses
NVIT Nationwide Fund | ||||||||||||||||||||||
Beginning | Ending | Expenses Paid | Annualized | |||||||||||||||||||
Account Value, | Account | During Period* | Expense Ratio* | |||||||||||||||||||
January 1, 2007 | Value, | |||||||||||||||||||||
June 30, 2007 | ||||||||||||||||||||||
Class I | Actual | $ | 1,000.00 | $ | 1,081.30 | $ | 3.97 | 0.77% | ||||||||||||||
Hypothetical | 1 | $ | 1,000.00 | $ | 1,020.98 | $ | 3.87 | 0.77% | ||||||||||||||
Class II | Actual | $ | 1,000.00 | $ | 1,080.50 | $ | 5.36 | 1.04% | ||||||||||||||
Hypothetical | 1 | $ | 1,000.00 | $ | 1,019.64 | $ | 5.22 | 1.04% | ||||||||||||||
Class III | Actual | $ | 1,000.00 | $ | 1,081.00 | $ | 4.13 | 0.80% | ||||||||||||||
Hypothetical | 1 | $ | 1,000.00 | $ | 1,020.83 | $ | 4.02 | 0.80% | ||||||||||||||
Class IV | Actual | $ | 1,000.00 | $ | 1,081.30 | $ | 4.03 | 0.78% | ||||||||||||||
Hypothetical | 1 | $ | 1,000.00 | $ | 1,020.93 | $ | 3.92 | 0.78% | ||||||||||||||
* | Expenses are equal to the Fund’s annualized expense ratio multiplied by the average account value over the period multiplied by 181/365 (to reflect the one-half year period). The expense ratio presented represents a six-month, annualized ratio in accordance with SEC guidelines. The expenses reported above do not include the effect of additional expenses imposed by variable annuity contracts. | |
1 | Represents the hypothetical 5% return before expenses. |
Asset Allocation | ||||
Common Stock | 95.4% | |||
Commercial Paper | 0.7% | |||
Other Investments* | 5.4% | |||
Liabilities in excess of other assets** | -1.5% | |||
100.0% |
Top Holdings*** | ||||
Microsoft Corp. | 3.6% | |||
Procter & Gamble Co. (The) | 3.1% | |||
Bank of America Corp. | 3.1% | |||
Cisco Systems, Inc. | 2.7% | |||
AT&T, Inc. | 2.5% | |||
Intel Corp. | 2.0% | |||
Colgate-Palmolive Co. | 2.0% | |||
Pfizer, Inc. | 1.9% | |||
Exxon Mobil Corp. | 1.8% | |||
Merrill Lynch & Co., Inc. | 1.5% | |||
Other | 75.8% | |||
100.0% |
Top Industries | ||||
Diversified Financial Services | 9.6% | |||
Oil, Gas & Consumable Fuels | 8.8% | |||
Pharmaceuticals | 6.4% | |||
Household Products | 5.3% | |||
Insurance | 5.0% | |||
Software | 4.9% | |||
Communications Equipment | 4.2% | |||
Semiconductors & Semiconductor Equipment | 4.1% | |||
Machinery | 3.0% | |||
Multiline Retail | 3.0% | |||
Other | 45.7% | |||
100.0% |
* | Includes value of collateral received from securities lending. |
** | Includes value of collateral owed from securities lending. |
*** | For purpose of listing top holdings, repurchase agreements are included as part of Other. |
NVIT Nationwide Fund
Common Stock (95.4%) | ||||||||
Shares or | ||||||||
Principal Amount | Value | |||||||
Aerospace & Defense (2.2%) | ||||||||
Boeing Co. (The) | 124,929 | $ | 12,013,173 | |||||
Northrop Grumman Corp. | 125,212 | 9,750,258 | ||||||
Raytheon Co. | 301,320 | 16,238,135 | ||||||
United Technologies Corp. | 84,500 | 5,993,585 | ||||||
43,995,151 | ||||||||
Auto Components (0.8%) | ||||||||
B.F. Goodrich Co. (The) | 108,300 | 6,450,348 | ||||||
Goodyear Tire & Rubber Co.* | 102,130 | 3,550,039 | ||||||
Johnson Controls, Inc. | 50,000 | 5,788,500 | ||||||
15,788,887 | ||||||||
Beverages (1.0%) | ||||||||
Coca-Cola Co. | 55,100 | 2,882,281 | ||||||
Constellation Brands, Inc.* (a) | 670,750 | 16,285,810 | ||||||
19,168,091 | ||||||||
Biotechnology (0.3%) | ||||||||
Genzyme Corp.* | 26,300 | 1,693,720 | ||||||
Gilead Sciences, Inc.* | 109,000 | 4,225,930 | ||||||
5,919,650 | ||||||||
Building Products (0.1%) | ||||||||
American Standard Cos., Inc. | 27,200 | 1,604,256 | ||||||
Capital Markets (1.8%) | ||||||||
Credit Suisse Group ADR - CH | 91,010 | 6,458,070 | ||||||
Lehman Brothers Holding, Inc. | 225,430 | 16,799,043 | ||||||
Lloyds TSB Group PLC ADR - GB (a) | 157,830 | 7,058,158 | ||||||
T. Rowe Price Group, Inc. | 87,000 | 4,514,430 | ||||||
34,829,701 | ||||||||
Chemicals (1.0%) | ||||||||
Agrium, Inc. | 166,800 | 7,297,500 | ||||||
E.I. du Pont de Nemours & Co. | 68,700 | 3,492,708 | ||||||
Monsanto Co. | 32,900 | 2,222,066 | ||||||
Syngenta AG ADR - CH | 157,500 | 6,131,475 | ||||||
19,143,749 | ||||||||
Commercial Banks (1.7%) | ||||||||
Allied Irish Banks ADR - IE | 34,000 | 1,868,640 | ||||||
Australia & New Zealand Banking Group Ltd. ADR - AU | 21,500 | 2,647,295 | ||||||
Bank Of Ireland ADR - IE (a) | 13,100 | 1,063,065 | ||||||
Compass Bancshares, Inc. | 55,000 | 3,793,900 | ||||||
Kookmin Bank ADR - KR | 59,800 | 5,245,656 | ||||||
Marshall & Ilsley Corp. | 34,400 | 1,638,472 | ||||||
National Australia Bank Ltd. ADR - AU | 12,700 | 2,187,575 | ||||||
PNC Bank Corp. | 121,200 | 8,675,496 | ||||||
U.S. Bancorp | 221,100 | 7,285,245 | ||||||
Woori Finance Holdings ADR - KR* (a) | 2,800 | 214,172 | ||||||
34,619,516 | ||||||||
Commercial Services & Supplies (0.7%) | ||||||||
Donnelley (R.R.) & Sons Co. | 50,600 | 2,201,606 | ||||||
Manpower, Inc. | 94,700 | 8,735,128 | ||||||
Waste Management, Inc. | 75,100 | 2,932,655 | ||||||
13,869,389 | ||||||||
Communications Equipment (4.2%) | ||||||||
Cisco Systems, Inc.* | 1,908,127 | 53,141,337 | ||||||
Corning, Inc.* | 246,000 | 6,285,300 | ||||||
Harris Corp. (a) | 255,500 | 13,937,525 | ||||||
QUALCOMM, Inc. | 195,050 | 8,463,219 | ||||||
Telefonaktiebolaget LM Ericsson ADR - SE | 40,000 | 1,595,600 | ||||||
83,422,981 | ||||||||
Computers & Peripherals (2.1%) | ||||||||
Hewlett-Packard Co. | 617,700 | 27,561,774 | ||||||
International Business Machines Corp. | 128,994 | 13,576,619 | ||||||
41,138,393 | ||||||||
Construction & Engineering (0.2%) | ||||||||
Fluor Corp. | 35,600 | 3,964,772 | ||||||
Containers & Packaging (0.8%) | ||||||||
Bemis Co. | 261,800 | 8,686,524 | ||||||
Packaging Corp. of America | 306,000 | 7,744,860 | ||||||
16,431,384 | ||||||||
Diversified Financial Services (9.6%) | ||||||||
Bank of America Corp. | 1,262,135 | 61,705,780 | ||||||
Citigroup, Inc. | 340,613 | 17,470,041 | ||||||
Goldman Sachs Group, Inc. | 48,600 | 10,534,050 | ||||||
JP Morgan Chase & Co. | 563,743 | 27,313,349 | ||||||
Merrill Lynch & Co., Inc. | 365,500 | 30,548,490 | ||||||
Moody’s Corp. | 120,100 | 7,470,220 | ||||||
Morgan Stanley | 344,681 | 28,911,842 | ||||||
State Street Corp. | 95,400 | 6,525,360 | ||||||
190,479,132 | ||||||||
Common Stock (continued) | ||||||||
Shares or | ||||||||
Principal Amount | Value | |||||||
Diversified Telecommunication Services (3.0%) | ||||||||
AT&T, Inc. | 1,197,539 | $ | 49,697,868 | |||||
Embarq Corp. | 47,500 | 3,010,075 | ||||||
Qwest Communications International, Inc.* | 198,300 | 1,923,510 | ||||||
Windstream Corp. | 270,000 | 3,985,200 | ||||||
58,616,653 | ||||||||
Electric Utilities (1.4%) | ||||||||
Duke Energy Corp. | 78,300 | 1,432,890 | ||||||
Gilead Sciences, Inc. | 510,800 | 14,486,288 | ||||||
Portland General Electric Co. (a) | 145,100 | 3,981,544 | ||||||
Southern Co. | 204,430 | 7,009,905 | ||||||
26,910,627 | ||||||||
Electrical Equipment (0.4%) | ||||||||
Ametek, Inc. | 10,000 | 396,800 | ||||||
Emerson Electric Co. | 159,800 | 7,478,640 | ||||||
7,875,440 | ||||||||
Electronic Equipment & Instruments (0.7%) | ||||||||
Arrow Electronics, Inc.* | 181,890 | 6,990,033 | ||||||
Flextronics International Ltd.* | 95,200 | 1,028,160 | ||||||
Jabil Circuit, Inc. | 230,000 | 5,076,100 | ||||||
13,094,293 | ||||||||
Energy Equipment & Services (2.4%) | ||||||||
ENSCO International, Inc. | 64,600 | 3,941,246 | ||||||
Halliburton Co. | 210,000 | 7,245,000 | ||||||
Helmerich & Payne, Inc. (a) | 210,100 | 7,441,742 | ||||||
Nabors Industries Ltd. - BM* | 63,000 | 2,102,940 | ||||||
Noble Corp. ADR - KY | 68,700 | 6,699,624 | ||||||
Schlumberger Ltd. ADR - NL | 44,100 | 3,745,854 | ||||||
Tidewater, Inc. (a) | 237,200 | 16,812,736 | ||||||
47,989,142 | ||||||||
Entertainment (0.7%) | ||||||||
Walt Disney Co. (The) | 412,400 | 14,079,336 | ||||||
Food & Staples Retailing (1.6%) | ||||||||
CVS/Caremark Corp. | 279,500 | 10,187,775 | ||||||
Kroger Co. | 25,600 | 720,128 | ||||||
Wal-Mart Stores, Inc. | 173,900 | 8,366,329 | ||||||
Walgreen Co. | 263,100 | 11,455,374 | ||||||
30,729,606 | ||||||||
Food Products (1.3%) | ||||||||
Archer-Daniels Midland Co. | 277,800 | 9,192,402 | ||||||
General Mills, Inc. | 53,000 | 3,096,260 | ||||||
PepsiCo, Inc. | 201,200 | 13,047,820 | ||||||
25,336,482 | ||||||||
Health Care Equipment & Supplies (0.6%) | ||||||||
Alcon, Inc. - CH (a) | 18,730 | 2,526,864 | ||||||
AstraZeneca PLC ADR - GB | 169,830 | 9,082,509 | ||||||
11,609,373 | ||||||||
Health Care Providers & Services (2.2%) | ||||||||
Aetna, Inc. | 250,950 | 12,396,930 | ||||||
AmerisourceBergen Corp. | 84,000 | 4,155,480 | ||||||
McKesson Corp. | 122,200 | 7,288,008 | ||||||
UnitedHealth Group, Inc. | 226,150 | 11,565,311 | ||||||
WellPoint, Inc.* | 111,150 | 8,873,104 | ||||||
44,278,833 | ||||||||
Hotels, Restaurants & Leisure (1.0%) | ||||||||
Carnival Corp. - PA | 48,000 | 2,340,960 | ||||||
Hilton Hotels Corp. | 13,100 | 438,457 | ||||||
Marriott International, Inc., Class A | 130,000 | 5,621,200 | ||||||
McDonald’s Corp. | 120,400 | 6,111,504 | ||||||
Sonic Corp.* (a) | 70,000 | 1,548,400 | ||||||
Starwood Hotels & Resorts Worldwide, Inc. | 69,900 | 4,688,193 | ||||||
20,748,714 | ||||||||
Household Durables (0.1%) (a) | ||||||||
Syntax-Brillian Corp.* | 474,670 | 2,335,376 | ||||||
Household Products (5.3%) | ||||||||
Colgate-Palmolive Co. | 603,480 | 39,135,678 | ||||||
Kimberly-Clark Corp. | 55,000 | 3,678,950 | ||||||
Procter & Gamble Co. (The) | 1,012,850 | 61,976,291 | ||||||
104,790,919 | ||||||||
Independent Power Producers & Energy Traders (0.4%) | ||||||||
Dynegy, Inc.* | 849,800 | 8,022,112 | ||||||
Industrial Conglomerates (1.2%) | ||||||||
3M Co. | 87,050 | 7,555,070 | ||||||
Carlisle Cos., Inc. (a) | 140,600 | 6,539,306 | ||||||
General Electric Co. | 252,315 | 9,658,618 | ||||||
23,752,994 | ||||||||
NVIT Nationwide Fund (Continued)
Common Stock (continued) | ||||||||
Shares or | ||||||||
Principal Amount | Value | |||||||
Insurance (5.0%) | ||||||||
Allstate Corp. | 104,700 | $ | 6,440,097 | |||||
American International Group, Inc. | 176,700 | 12,374,301 | ||||||
Chubb Corp. (The) | 200,100 | 10,833,414 | ||||||
Hartford Financial Services Group, Inc. (The) | 117,400 | 11,565,074 | ||||||
Lincoln National Corp. | 83,700 | 5,938,515 | ||||||
MetLife, Inc. | 258,244 | 16,651,573 | ||||||
Prudential Financial, Inc. | 193,135 | 18,778,516 | ||||||
Travelers Cos., Inc. (The) | 233,900 | 12,513,650 | ||||||
W.R. Berkley Corp. | 127,500 | 4,148,850 | ||||||
99,243,990 | ||||||||
Internet Software & Services (0.9%) | ||||||||
eBay, Inc.* | 311,000 | 10,007,980 | ||||||
Google, Inc., Class A* | 13,950 | 7,301,151 | ||||||
17,309,131 | ||||||||
IT Services (0.0%) | ||||||||
Fiserv, Inc.* | 16,200 | 920,160 | ||||||
Leisure Equipment & Products (0.7%) | ||||||||
Time Warner, Inc. | 688,566 | 14,487,429 | ||||||
Life Sciences Tools & Services (0.5%) | ||||||||
Thermo Fisher Scientific, Inc.* | 205,800 | 10,643,976 | ||||||
Machinery (3.0%) | ||||||||
Caterpillar, Inc. | 89,100 | 6,976,530 | ||||||
Cummins, Inc. | 48,400 | 4,898,564 | ||||||
Danaher Corp. | 28,200 | 2,129,100 | ||||||
Deere & Co. | 95,800 | 11,566,892 | ||||||
Eaton Corp. | 70,000 | 6,510,000 | ||||||
Illinois Tool Works, Inc. | 169,350 | 9,177,077 | ||||||
Joy Global, Inc. (a) | 59,100 | 3,447,303 | ||||||
Parker Hannifin Corp. | 143,450 | 14,045,189 | ||||||
Terex Corp.* | 12,400 | 1,008,120 | ||||||
59,758,775 | ||||||||
Marine (0.1%) (a) | ||||||||
Omega Navigation Enterprises, Inc. | 134,000 | 2,914,500 | ||||||
Media (0.9%) | ||||||||
Citadel Broadcasting Co. (a) | 31,670 | 204,271 | ||||||
Discovery Holding Co.* (a) | 40,000 | 919,600 | ||||||
Idearc, Inc. (a) | 1 | 18 | ||||||
News Corp. | 235,200 | 4,988,592 | ||||||
Omnicom Group, Inc. | 219,360 | 11,608,531 | ||||||
Viacom, Inc., Class B* | 1 | 42 | ||||||
17,721,054 | ||||||||
Metals & Mining (2.2%) | ||||||||
Alcoa, Inc. | 94,700 | 3,838,191 | ||||||
Allegheny Technologies, Inc. | 37,900 | 3,974,952 | ||||||
Freeport-McMoRan Copper & Gold, Inc., Class B (a) | 186,200 | 15,421,084 | ||||||
Nucor Corp. | 183,500 | 10,762,275 | ||||||
Steel Dynamics, Inc. | 45,500 | 1,906,905 | ||||||
U.S. Steel Corp. | 75,200 | 8,178,000 | ||||||
44,081,407 | ||||||||
Multi-Utilities (1.0%) | ||||||||
Sempra Energy | 338,600 | 20,055,278 | ||||||
Multiline Retail (3.0%) | ||||||||
J.C. Penney Co., Inc. | 204,100 | 14,772,758 | ||||||
Kohl’s Corp.* | 122,900 | 8,729,587 | ||||||
Macy’s, Inc. | 349,000 | 13,883,220 | ||||||
Nordstrom, Inc. | 91,900 | 4,697,928 | ||||||
Target Corp. | 267,170 | 16,992,012 | ||||||
59,075,505 | ||||||||
Oil, Gas & Consumable Fuels (8.8%) | ||||||||
Chesapeake Energy Corp. (a) | 223,300 | 7,726,180 | ||||||
ChevronTexaco Corp. | 238,344 | 20,078,098 | ||||||
ConocoPhillips | 370,714 | 29,101,049 | ||||||
Devon Energy Corp. | 118,200 | 9,253,878 | ||||||
EOG Resources, Inc. | 68,100 | 4,975,386 | ||||||
Exxon Mobil Corp. | 422,343 | 35,426,131 | ||||||
Hess Corp. | 147,870 | 8,718,415 | ||||||
Marathon Oil Corp. | 60,836 | 3,647,727 | ||||||
Murphy Oil Corp. | 277,600 | 16,500,544 | ||||||
Occidental Petroleum Corp. | 218,383 | 12,640,008 | ||||||
Peabody Energy Corp. | 91,500 | 4,426,770 | ||||||
Spectra Energy Corp. | 74,800 | 1,941,808 | ||||||
Sunoco, Inc. | 20,100 | 1,601,568 | ||||||
Valero Energy Corp. | 261,100 | 19,284,846 | ||||||
175,322,408 | ||||||||
Pharmaceuticals (6.4%) | ||||||||
Abbott Laboratories | 189,800 | 10,163,790 | ||||||
Allergan, Inc. | 30,080 | 1,733,811 | ||||||
Eli Lilly & Co. | 43,900 | 2,453,132 | ||||||
Johnson & Johnson | 378,491 | 23,322,616 | ||||||
Merck & Co., Inc. | 324,100 | 16,140,180 | ||||||
Mylan Laboratories, Inc. | 277,300 | 5,044,087 |
Common Stock (continued) | ||||||||
Shares or | ||||||||
Principal Amount | Value | |||||||
Pharmaceuticals (continued) | ||||||||
Pfizer, Inc. | 1,477,190 | $ | 37,771,748 | |||||
Schering-Plough Corp. | 181,500 | 5,524,860 | ||||||
Wyeth | 415,300 | 23,813,302 | ||||||
125,967,526 | ||||||||
Real Estate Investment Trusts (REITs) (1.0%) | ||||||||
Ashford Hospitality Trust (a) | 230,700 | 2,713,032 | ||||||
First Industrial Realty Trust (a) | 21,350 | 827,526 | ||||||
Host Hotels & Resorts, Inc. | 353,200 | 8,165,984 | ||||||
Lexington Corporate Properties Trust (a) | 121,400 | 2,525,120 | ||||||
Simon Property Group, Inc. | 51,400 | 4,782,256 | ||||||
19,013,918 | ||||||||
Road & Rail (0.9%) | ||||||||
Burlington Northern Santa Fe Corp. | 61,150 | 5,206,311 | ||||||
Norfolk Southern Corp. | 49,000 | 2,575,930 | ||||||
Union Pacific Corp. | 89,800 | 10,340,470 | ||||||
18,122,711 | ||||||||
Semiconductors & Semiconductor Equipment (4.1%) | ||||||||
Altera Corp. | 111,200 | 2,460,856 | ||||||
Applied Materials, Inc. | 740,400 | 14,711,748 | ||||||
Intel Corp. | 1,674,189 | 39,778,731 | ||||||
KLA-Tencor Corp. | 48,100 | 2,643,095 | ||||||
Lam Research Corp.* (a) | 78,700 | 4,045,180 | ||||||
Maxim Integrated Products, Inc. | 51,000 | 1,703,910 | ||||||
MEMC Electronic Materials, Inc.* | 54,300 | 3,318,816 | ||||||
Texas Instruments, Inc. | 290,650 | 10,937,159 | ||||||
Xilinx, Inc. | 45,000 | 1,204,650 | ||||||
80,804,145 | ||||||||
Software (4.9%) | ||||||||
BEA Systems, Inc.* (a) | 531,300 | 7,273,497 | ||||||
Microsoft Corp. | 2,418,686 | 71,278,676 | ||||||
Oracle Corp.* | 855,900 | 16,869,789 | ||||||
Tibco Software, Inc.* (a) | 214,000 | 1,936,700 | ||||||
97,358,662 | ||||||||
Specialty Retail (1.5%) | ||||||||
American Eagle Outfitters Ltd. (a) | 197,000 | 5,055,020 | ||||||
Group 1 Automotive, Inc. (a) | 90,600 | 3,654,804 | ||||||
Lowe’s Cos., Inc. | 83,500 | 2,562,615 | ||||||
Nike, Inc. | 94,000 | 5,479,260 | ||||||
OfficeMax, Inc. | 106,700 | 4,193,310 | ||||||
TJX Cos., Inc. | 291,730 | 8,022,575 | ||||||
28,967,584 | ||||||||
Tobacco (0.7%) (a) | ||||||||
Reynolds American, Inc. | 224,724 | 14,652,005 | ||||||
Wireless Telecommunication Services (1.0%) (a) | ||||||||
Telephone & Data Systems, Inc. | 83,500 | 5,224,595 | ||||||
Vodafone Group PLC ADR - GB | 419,137 | 14,095,577 | ||||||
19,320,172 | ||||||||
Total Common Stocks (Cost $1,790,671,634) | 1,890,285,288 | |||||||
Commercial Paper (4.8%) (b) | ||||||||
Consumer Finance (4.8%) | ||||||||
Carrera Capital Finance LLC, 5.48%, 07/02/07 | $ | 49,000,000 | 48,985,300 | |||||
Countrywide Home Loans, 5.40%, 07/02/07 | 3,339,000 | 3,337,998 | ||||||
PB Finance (Delaware), 5.53%, 07/02/07 | 10,010,000 | 10,008,485 | ||||||
Stanfield Victoria Funding, 5.38%, 07/02/07 | 33,407,000 | 33,397,015 | ||||||
Total Commercial Paper (Cost $95,741,642) | 95,728,798 | |||||||
Securities Held as Collateral for Securities on Loan (5.5%) | ||||||||
Morgan Stanley Repurchase Agreement, 5.42%, dated 06/29/07, due 07/02/07, repurchase price $107,708,326, collateralized by U.S. Government Agency Mortgages with a market value of $109,812,894 | $ | 107,659,700 | 107,659,700 | |||||
Total Investments (Cost $1,994,072,976) (c) — 105.7% | 2,093,673,786 | |||||||
Liabilities in excess of other assets — (5.7)% | (111,992,133 | ) | ||||||
NET ASSETS — 100.0% | $ | 1,981,681,653 | ||||||
NVIT Nationwide Fund (Continued)
* | Denotes a non-income producing security. | |
(a) | All or a part of the security was on loan as of June 30, 2007. | |
(b) | The rate reflected in the Statement of Investments is the effective yield as of June 30, 2007. | |
(c) | See notes to financial statements for tax unrealized appreciation (depreciation) of securities. |
ADR | American Depository Receipt | |
AU | Australia | |
BM | Bermuda | |
CH | Switzerland | |
GB | United Kingdom | |
IE | Ireland | |
KR | Korea | |
KY | Cayman Islands | |
NL | Netherlands | |
PA | Panama | |
SE | Sweden |
See accompanying notes to financial statements.
NVIT | ||||||
Nationwide Fund | ||||||
Assets: | ||||||
Investments, at value (cost $1,886,413,276)* | $ | 1,986,014,086 | ||||
Repurchase agreements, at cost and value | 107,659,700 | |||||
Total Investments | 2,093,673,786 | |||||
Cash | 303,317 | |||||
Interest and dividends receivable | 2,552,503 | |||||
Receivable for capital shares issued | 801,865 | |||||
Prepaid expenses | 12,355 | |||||
Total Assets | 2,097,343,826 | |||||
Liabilities: | ||||||
Payable for investments purchased | 6,083,067 | |||||
Payable upon return of securities loaned | 107,659,700 | |||||
Payable for capital shares redeemed | 712,947 | |||||
Accrued expenses and other payables: | ||||||
Investment advisory fees | 896,413 | |||||
Fund administration and transfer agent fees | 114,131 | |||||
Distribution fees | 61,063 | |||||
Administrative servicing fees | 103,384 | |||||
Compliance program costs | 13,839 | |||||
Other | 17,629 | |||||
Total Liabilities | 115,662,173 | |||||
Net Assets | $ | 1,981,681,653 | ||||
Represented by: | ||||||
Capital | $ | 1,721,897,622 | ||||
Accumulated net investment income | 437,736 | |||||
Accumulated net realized gains from investment transactions | 159,745,485 | |||||
Net unrealized appreciation on investments | 99,600,810 | |||||
Net Assets | $ | 1,981,681,653 | ||||
Net Assets: | ||||||
Class I Shares | $ | 1,501,660,501 | ||||
Class II Shares | 306,367,346 | |||||
Class III Shares | 2,114,339 | |||||
Class IV Shares | 171,539,467 | |||||
Total | $ | 1,981,681,653 | ||||
Shares outstanding (unlimited number of shares authorized): | ||||||
Class I Shares | 109,908,589 | |||||
Class II Shares | 22,502,398 | |||||
Class III Shares | 154,518 | |||||
Class IV Shares | 12,557,672 | |||||
Total | 145,123,177 | |||||
Net asset value and offering price per share (Net assets by class divided by shares outstanding by class, respectively.): | ||||||
Class I Shares | $ | 13.66 | ||||
Class II Shares | $ | 13.62 | (a) | |||
Class III Shares | $ | 13.68 | ||||
Class IV Shares | $ | 13.66 | ||||
(a) | The NAV reported above represents the traded NAV at June 30, 2007. Due to the financial statement rounding of class assets and class shares above, the NAV results in a different NAV than the traded NAV. | |
* | Includes value of securities on loan of $105,633,249. |
11
NVIT | |||||
Nationwide Fund | |||||
INVESTMENT INCOME: | |||||
Interest income | $ | 938,118 | |||
Dividend income | 16,070,482 | ||||
Income from securities lending | 134,338 | ||||
Foreign tax withholding | (9,556 | ) | |||
Total Income | 17,133,382 | ||||
Expenses: | |||||
Investment advisory fees | 5,334,342 | ||||
Fund administration and transfer agent fees | 565,007 | ||||
Distribution fees Class II Shares | 300,574 | ||||
Administrative servicing fees Class I Shares | 971,600 | ||||
Administrative servicing fees Class II Shares | 179,673 | ||||
Administrative servicing fees Class III Shares | 1,279 | ||||
Administrative servicing fees Class IV Shares | 114,835 | ||||
Custodian fees | 41,547 | ||||
Trustee fees | 44,549 | ||||
Compliance program costs (Note 3) | 2,874 | ||||
Other | 79,561 | ||||
Total expenses before earnings credit | 7,635,841 | ||||
Earnings credit (Note 6) | (10,989 | ) | |||
Net Expenses | 7,624,852 | ||||
Net Investment Income | 9,508,530 | ||||
REALIZED/ UNREALIZED GAINS (LOSSES) FROM INVESTMENTS: | |||||
Net realized gains on investment transactions | 187,697,259 | ||||
Net change in unrealized depreciation on investments | (48,536,013 | ) | |||
Net realized/unrealized gains (losses) on investments | 139,161,246 | ||||
CHANGE IN NET ASSETS RESULTING FROM OPERATIONS | $ | 148,669,776 | |||
12
NVIT Nationwide Fund | |||||||||
Six Months Ended | Year Ended | ||||||||
June 30, 2007 | December 31, 2006 | ||||||||
(Unaudited) | |||||||||
FROM INVESTMENT ACTIVITIES: | |||||||||
Operations: | |||||||||
Net investment income | $ | 9,508,530 | $ | 18,496,056 | |||||
Net realized gains on investment transactions | 187,697,259 | 160,829,063 | |||||||
Net change in unrealized appreciation/depreciation on investments | (48,536,013 | ) | 43,781,755 | ||||||
Change in net assets resulting from operations | 148,669,776 | 223,106,874 | |||||||
Distributions to shareholders from: | |||||||||
Net investment income: | |||||||||
Class I | (7,201,393 | ) | (15,756,598 | ) | |||||
Class II | (1,042,480 | ) | (1,016,725 | ) | |||||
Class III | (8,370 | ) | (14,436 | ) | |||||
Class IV | (818,551 | ) | (1,750,451 | ) | |||||
Net realized gains on investments: | |||||||||
Class I | (70,089,329 | ) | – | ||||||
Class II | (14,076,996 | ) | – | ||||||
Class III | (101,330 | ) | – | ||||||
Class IV | (8,009,930 | ) | – | ||||||
Change in net assets from shareholder distributions | (101,348,379 | ) | (18,538,210 | ) | |||||
Change in net assets from capital transactions | 93,944,390 | (59,202,504 | ) | ||||||
Change in net assets | 141,265,787 | 145,366,160 | |||||||
Net Assets: | |||||||||
Beginning of period | 1,840,415,866 | 1,695,049,706 | |||||||
End of period | $ | 1,981,681,653 | $ | 1,840,415,866 | |||||
Accumulated net investment income at end of period | $ | 437,736 | $ | – | |||||
CAPITAL TRANSACTIONS: | |||||||||
Class I Shares | |||||||||
Proceeds from shares issued | $ | 9,006,193 | $ | 8,335,766 | |||||
Dividends reinvested | 77,290,622 | 15,756,598 | |||||||
Cost of shares redeemed | (108,704,600 | ) | (218,122,841 | ) | |||||
(22,407,785 | ) | (194,030,477 | ) | ||||||
Class II Shares | |||||||||
Proceeds from shares issued | 101,002,587 | 150,928,243 | |||||||
Dividends reinvested | 15,119,435 | 1,016,725 | |||||||
Cost of shares redeemed | (733,902 | ) | (2,152,437 | ) | |||||
115,388,120 | 149,792,531 | ||||||||
Class III Shares | |||||||||
Proceeds from shares issued | 1,120,970 | 1,154,191 | |||||||
Dividends reinvested | 109,700 | 14,436 | |||||||
Cost of shares redeemed | (880,800 | ) | (1,138,554 | ) | |||||
349,870 | 30,073 | ||||||||
13
NVIT Nationwide Fund | |||||||||
Six Months Ended | Year Ended | ||||||||
June 30, 2007 | December 31, 2006 | ||||||||
(Unaudited) | |||||||||
CAPITAL TRANSACTIONS: (continued) | |||||||||
Class IV Shares | |||||||||
Proceeds from shares issued | $ | 1,762,306 | $ | 3,855,172 | |||||
Dividends reinvested | 8,828,458 | 1,750,451 | |||||||
Cost of shares redeemed | (9,976,579 | ) | (20,600,254 | ) | |||||
614,185 | (14,994,631 | ) | |||||||
Change in net assets from capital transactions | $ | 93,944,390 | $ | (59,202,504 | ) | ||||
SHARE TRANSACTIONS: | |||||||||
Class I Shares | |||||||||
Issued | 657,403 | 677,225 | |||||||
Reinvested | 5,686,387 | 1,264,192 | |||||||
Redeemed | (7,862,099 | ) | (17,658,704 | ) | |||||
(1,518,309 | ) | (15,717,287 | ) | ||||||
Class II Shares | |||||||||
Issued | 7,301,911 | 12,156,768 | |||||||
Reinvested | 1,116,529 | 80,475 | |||||||
Redeemed | (52,804 | ) | (176,853 | ) | |||||
8,365,636 | 12,060,390 | ||||||||
Class III Shares | |||||||||
Issued | 78,807 | 89,452 | |||||||
Reinvested | 8,060 | 1,143 | |||||||
Redeemed | (65,855 | ) | (91,482 | ) | |||||
21,012 | (887 | ) | |||||||
Class IV Shares | |||||||||
Issued | 126,700 | 311,095 | |||||||
Reinvested | 649,539 | 140,403 | |||||||
Redeemed | (722,754 | ) | (1,669,408 | ) | |||||
53,485 | (1,217,910 | ) | |||||||
Total change in shares | 6,921,824 | (4,875,694 | ) | ||||||
14
Distributions | ||||||||||||||||||||
Investment Activities | ||||||||||||||||||||
Net Realized | ||||||||||||||||||||
and | ||||||||||||||||||||
Net Asset | Unrealized | Total | ||||||||||||||||||
Value, | Net | Gains | from | Net | ||||||||||||||||
Beginning | Investment | (Losses) on | Investment | Investment | ||||||||||||||||
of Period | Income | Investments | Activities | Income | ||||||||||||||||
Class I Shares | ||||||||||||||||||||
For the year ended December 31, 2002 | $ | 9.89 | 0.08 | (1.79 | ) | (1.71 | ) | (0.08 | ) | |||||||||||
For the year ended December 31, 2003 | $ | 8.10 | 0.08 | 2.14 | 2.22 | (0.05 | ) | |||||||||||||
For the year ended December 31, 2004 | $ | 10.27 | 0.12 | 0.88 | 1.00 | (0.14 | ) | |||||||||||||
For the year ended December 31, 2005 | $ | 11.13 | 0.10 | 0.72 | 0.82 | (0.10 | ) | |||||||||||||
For the year ended December 31, 2006 | $ | 11.85 | 0.14 | 1.47 | 1.61 | (0.14 | ) | |||||||||||||
For the six months ended June 30, 2007 (Unaudited) | $ | 13.32 | 0.07 | 1.01 | 1.08 | (0.07 | ) | |||||||||||||
Class II Shares | ||||||||||||||||||||
For the year ended December 31, 2002 (e) | $ | 8.68 | 0.04 | (0.57 | ) | (0.53 | ) | (0.05 | ) | |||||||||||
For the year ended December 31, 2003 | $ | 8.10 | 0.05 | 2.15 | 2.20 | (0.04 | ) | |||||||||||||
For the year ended December 31, 2004 | $ | 10.26 | 0.08 | 0.89 | 0.97 | (0.11 | ) | |||||||||||||
For the year ended December 31, 2005 | $ | 11.12 | 0.07 | 0.71 | 0.78 | (0.08 | ) | |||||||||||||
For the year ended December 31, 2006 | $ | 11.82 | 0.10 | 1.48 | 1.58 | (0.12 | ) | |||||||||||||
For the six months ended June 30, 2007 (Unaudited) | $ | 13.28 | 0.05 | 1.01 | 1.06 | (0.05 | ) |
[Additional columns below]
[Continued from above table, first column(s) repeated]
Distributions | ||||||||||||||||||||||||
Ratio of | ||||||||||||||||||||||||
Net Assets | Expenses to | |||||||||||||||||||||||
Net | Net Asset | at End of | Average | |||||||||||||||||||||
realized | Total | Value, End | Total | Period | Net | |||||||||||||||||||
gains | Distributions | of Period | Return (a) | (000s) | Assets (b) | |||||||||||||||||||
Class I Shares | ||||||||||||||||||||||||
For the year ended December 31, 2002 | – | (0.08 | ) | $ | 8.10 | (17.35% | ) | $ | 1,252,686 | 0.83% | ||||||||||||||
For the year ended December 31, 2003 | – | (0.05 | ) | $ | 10.27 | 27.51% | $ | 1,459,917 | 0.83% | |||||||||||||||
For the year ended December 31, 2004 | – | (0.14 | ) | $ | 11.13 | 9.75% | $ | 1,402,753 | 0.83% | |||||||||||||||
For the year ended December 31, 2005 | – | (0.10 | ) | $ | 11.85 | 7.44% | $ | 1,506,358 | 0.83% | |||||||||||||||
For the year ended December 31, 2006 | – | (0.14 | ) | $ | 13.32 | 13.63% | $ | 1,484,346 | 0.82% | |||||||||||||||
For the six months ended June 30, 2007 (Unaudited) | (0.67 | ) | (0.74 | ) | $ | 13.66 | 8.13% | $ | 1,501,661 | 0.77% | ||||||||||||||
Class II Shares | ||||||||||||||||||||||||
For the year ended December 31, 2002 (e) | – | (0.05 | ) | $ | 8.10 | (6.14% | ) | $ | 765 | 1.07% | ||||||||||||||
For the year ended December 31, 2003 | – | (0.04 | ) | $ | 10.26 | 27.23% | $ | 5,570 | 1.08% | |||||||||||||||
For the year ended December 31, 2004 | – | (0.11 | ) | $ | 11.12 | 9.53% | $ | 11,210 | 1.08% | |||||||||||||||
For the year ended December 31, 2005 | – | (0.08 | ) | $ | 11.82 | 7.04% | $ | 24,550 | 1.08% | |||||||||||||||
For the year ended December 31, 2006 | – | (0.12 | ) | $ | 13.28 | 13.40% | $ | 187,747 | 1.06% | |||||||||||||||
For the six months ended June 30, 2007 (Unaudited) | (0.67 | ) | (0.72 | ) | $ | 13.62 | 8.05% | $ | 306,367 | 1.04% |
[Additional columns below]
[Continued from above table, first column(s) repeated]
Ratios/Supplemental Data | ||||||||||||||||||
Ratio of Net | ||||||||||||||||||
Ratio of | Investment | |||||||||||||||||
Ratio of Net | Expenses | Income | ||||||||||||||||
Investment | (Prior to | (Prior to | ||||||||||||||||
Income | Reimbursements) | Reimbursements) | ||||||||||||||||
to Average | to Average | to Average | Portfolio | |||||||||||||||
Net Assets (b) | Net Assets (b)(c) | Net Assets (b)(c) | Turnover (d) | |||||||||||||||
Class I Shares | ||||||||||||||||||
For the year ended December 31, 2002 | 0.84% | 0.84% | 0.83% | 33.25% | ||||||||||||||
For the year ended December 31, 2003 | 0.83% | (h) | (h) | 129.01% | ||||||||||||||
For the year ended December 31, 2004 | 1.07% | (h) | (h) | 131.43% | ||||||||||||||
For the year ended December 31, 2005 | 0.88% | (h) | (h) | 179.84% | ||||||||||||||
For the year ended December 31, 2006 | 1.08% | (h) | (h) | 222.16% | ||||||||||||||
For the six months ended June 30, 2007 (Unaudited) | 1.04% | 0.77% | 1.04% | 197.63% | ||||||||||||||
Class II Shares | ||||||||||||||||||
For the year ended December 31, 2002 (e) | 1.03% | (h) | (h) | 33.25% | ||||||||||||||
For the year ended December 31, 2003 | 0.60% | (h) | (h) | 129.01% | ||||||||||||||
For the year ended December 31, 2004 | 0.95% | (h) | (h) | 131.43% | ||||||||||||||
For the year ended December 31, 2005 | 0.66% | (h) | (h) | 179.84% | ||||||||||||||
For the year ended December 31, 2006 | 0.88% | (h) | (h) | 222.16% | ||||||||||||||
For the six months ended June 30, 2007 (Unaudited) | 0.79% | 1.04% | 0.79% | 197.63% |
[Additional columns below]
[Continued from above table, first column(s) repeated]
(a) | Not annualized for periods less than one year. |
(b) | Annualized for periods less than one year. |
(c) | During the period, certain fees were waived and/or reimbursed. If such waivers/reimbursements had not occurred, the ratios would have been as indicated. |
(d) | Portfolio turnover is calculated on the basis of the Fund as a whole without distinguishing among the classes of shares. |
(e) | For the period from July 11, 2002 (commencement of operations) through December 31, 2002. |
(f) | For the period from May 6, 2002 (commencement of operations) through December 31, 2002. |
(g) | For the period from April 28, 2003 (commencement of operations) through December 31, 2003. |
(h) | There were no fee reductions during the period. |
Distributions | ||||||||||||||||||||
Investment Activities | ||||||||||||||||||||
Net Realized | ||||||||||||||||||||
and | ||||||||||||||||||||
Net Asset | Unrealized | Total | ||||||||||||||||||
Value, | Net | Gains | from | Net | ||||||||||||||||
Beginning | Investment | (Losses) on | Investment | Investment | ||||||||||||||||
of Period | Income | Investments | Activities | Income | ||||||||||||||||
Class III Shares | ||||||||||||||||||||
For the year ended December 31, 2002 (f) | $ | 9.78 | 0.05 | (1.65 | ) | (1.60 | ) | (0.07 | ) | |||||||||||
For the year ended December 31, 2003 | $ | 8.11 | 0.09 | 2.13 | 2.22 | (0.05 | ) | |||||||||||||
For the year ended December 31, 2004 | $ | 10.28 | 0.11 | 0.89 | 1.00 | (0.13 | ) | |||||||||||||
For the year ended December 31, 2005 | $ | 11.15 | 0.09 | 0.73 | 0.82 | (0.11 | ) | |||||||||||||
For the year ended December 31, 2006 | $ | 11.86 | 0.13 | 1.49 | 1.62 | (0.14 | ) | |||||||||||||
For the six months ended June 30, 2007 (Unaudited) | $ | 13.34 | 0.07 | 1.01 | 1.08 | (0.07 | ) | |||||||||||||
Class IV Shares | ||||||||||||||||||||
For the year ended December 31, 2003 (g) | $ | 8.30 | 0.05 | 1.95 | 2.00 | (0.03 | ) | |||||||||||||
For the year ended December 31, 2004 | $ | 10.27 | 0.12 | 0.88 | 1.00 | (0.14 | ) | |||||||||||||
For the year ended December 31, 2005 | $ | 11.13 | 0.10 | 0.72 | 0.82 | (0.10 | ) | |||||||||||||
For the year ended December 31, 2006 | $ | 11.85 | 0.14 | 1.47 | 1.61 | (0.14 | ) | |||||||||||||
For the six months ended June 30, 2007 (Unaudited) | $ | 13.32 | 0.07 | 1.01 | 1.08 | (0.07 | ) | |||||||||||||
[Additional columns below]
[Continued from above table, first column(s) repeated]
Distributions | ||||||||||||||||||||||||
Ratio of | ||||||||||||||||||||||||
Net Assets | Expenses to | |||||||||||||||||||||||
Net | Net Asset | at End of | Average | |||||||||||||||||||||
realized | Total | Value, End | Total | Period | Net | |||||||||||||||||||
gains | Distributions | of Period | Return (a) | (000s) | Assets (b) | |||||||||||||||||||
Class III Shares | ||||||||||||||||||||||||
For the year ended December 31, 2002 (f) | – | (0.07 | ) | $ | 8.11 | (16.38% | ) | $ | 399 | 0.72% | ||||||||||||||
For the year ended December 31, 2003 | – | (0.05 | ) | $ | 10.28 | 27.48% | $ | 870 | 0.83% | |||||||||||||||
For the year ended December 31, 2004 | – | (0.13 | ) | $ | 11.15 | 9.84% | $ | 847 | 0.83% | |||||||||||||||
For the year ended December 31, 2005 | – | (0.11 | ) | $ | 11.86 | 7.35% | $ | 1,595 | 0.83% | |||||||||||||||
For the year ended December 31, 2006 | – | (0.14 | ) | $ | 13.34 | 13.71% | $ | 1,781 | 0.82% | |||||||||||||||
For the six months ended June 30, 2007 (Unaudited) | (0.67 | ) | (0.74 | ) | $ | 13.68 | 8.10% | $ | 2,114 | 0.80% | ||||||||||||||
Class IV Shares | ||||||||||||||||||||||||
For the year ended December 31, 2003 (g) | – | (0.03 | ) | $ | 10.27 | 24.17% | $ | 169,690 | 0.83% | |||||||||||||||
For the year ended December 31, 2004 | – | (0.14 | ) | $ | 11.13 | 9.75% | $ | 167,051 | 0.83% | |||||||||||||||
For the year ended December 31, 2005 | – | (0.10 | ) | $ | 11.85 | 7.44% | $ | 162,547 | 0.83% | |||||||||||||||
For the year ended December 31, 2006 | – | (0.14 | ) | $ | 13.32 | 13.63% | $ | 166,542 | 0.82% | |||||||||||||||
For the six months ended June 30, 2007 (Unaudited) | (0.67 | ) | (0.74 | ) | $ | 13.66 | 8.13% | $ | 171,539 | 0.78% | ||||||||||||||
[Additional columns below]
[Continued from above table, first column(s) repeated]
Ratios/Supplemental Data | ||||||||||||||||||
Ratio of Net | ||||||||||||||||||
Ratio of | Investment | |||||||||||||||||
Ratio of Net | Expenses | Income | ||||||||||||||||
Investment | (Prior to | (Prior to | ||||||||||||||||
Income | Reimbursements) | Reimbursements) | ||||||||||||||||
to Average | to Average | to Average | Portfolio | |||||||||||||||
Net Assets (b) | Net Assets (b)(c) | Net Assets (b)(c) | Turnover (d) | |||||||||||||||
Class III Shares | ||||||||||||||||||
For the year ended December 31, 2002 (f) | 1.07% | (h) | (h) | 33.25% | ||||||||||||||
For the year ended December 31, 2003 | 0.83% | (h) | (h) | 129.01% | ||||||||||||||
For the year ended December 31, 2004 | 1.05% | (h) | (h) | 131.43% | ||||||||||||||
For the year ended December 31, 2005 | 0.86% | (h) | (h) | 179.84% | ||||||||||||||
For the year ended December 31, 2006 | 1.02% | (h) | (h) | 222.16% | ||||||||||||||
For the six months ended June 30, 2007 (Unaudited) | 1.00% | 0.80% | 1.00% | 197.63% | ||||||||||||||
Class IV Shares | ||||||||||||||||||
For the year ended December 31, 2003 (g) | 0.85% | (h) | (h) | 129.01% | ||||||||||||||
For the year ended December 31, 2004 | 1.06% | (h) | (h) | 131.43% | ||||||||||||||
For the year ended December 31, 2005 | 0.86% | (h) | (h) | 179.84% | ||||||||||||||
For the year ended December 31, 2006 | 1.09% | (h) | (h) | 222.16% | ||||||||||||||
For the six months ended June 30, 2007 (Unaudited) | 1.03% | 0.78% | 1.03% | 197.63% | ||||||||||||||
(a) | Not annualized for periods less than one year. | |
(b) | Annualized for periods less than one year. | |
(c) | During the period, certain fees were waived and/or reimbursed. If such waivers/reimbursements had not occurred, the ratios would have been as indicated. | |
(d) | Portfolio turnover is calculated on the basis of the Fund as a whole without distinguishing among the classes of shares. | |
(e) | For the period from July 11, 2002 (commencement of operations) through December 31, 2002. | |
(f) | For the period from May 6, 2002 (commencement of operations) through December 31, 2002. | |
(g) | For the period from April 28, 2003 (commencement of operations) through December 31, 2003. | |
(h) | There were no fee reductions during the period. |
See accompanying notes to financial statements.
1. Organization
Nationwide Variable Insurance Trust (“NVIT” or the “Trust”) is an open-end management investment company, organized under the laws of Delaware by an amended and restated Agreement and Declaration of Trust, dated October 28, 2004, as amended to date. Prior to May 1, 2007, the Trust was named “Gartmore Variable Insurance Trust”. The Trust originally created under the laws of Massachusetts as a Massachusetts business trust pursuant to a Declaration of Trust dated, as of June 30, 1981, and as subsequently amended, redomesticated as a Delaware Statutory Trust after the close of trading on April 29, 2005, and is registered under the Investment Company Act of 1940, as amended (the “1940 Act”). The redomestication was a change in statutory status and did not affect the operations of the Trust. As of June 30, 2007, the Trust had authorized an unlimited number of shares of beneficial interest, without par value (“shares”). The Trust currently offers shares to life insurance company separate accounts to fund the benefits under variable life insurance or annuity policies. To date, only the separate accounts of Nationwide Life Insurance Company and Nationwide Life and Annuity Insurance Company (collectively, “Nationwide”) have purchased shares of the Nationwide NVIT Nationwide Fund (the “Fund”), (formerly, “Gartmore GVIT Nationwide Fund”). The Trust currently operates forty (40) separate series, or mutual funds, each with its own investment objectives and strategies. This report contains the financial statements and financial highlights of the Fund.
2. Summary of Significant Accounting Policies
The following is a summary of significant accounting policies followed by the Fund in the preparation of its financial statements. The policies are in conformity with accounting principles generally accepted in the United States of America (“GAAP”). The preparation of financial statements requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of income and expenses for the period. Actual results could differ from those estimates.
(a) | Security Valuation |
Securities for which market quotations are readily available are valued at current market value as of “Valuation Time.” Valuation Time is as of the close of regular trading on the New York Stock Exchange (usually 4 p.m. Eastern time). Equity securities are valued at the last quoted sale price or, if there is no sale price, the last quoted bid price provided by an independent pricing service approved by the Trust’s Board of Trustees (“Board of Trustees”). Securities traded on NASDAQ are valued at the NASDAQ official closing price. Prices are taken from the primary market or exchange in which each security trades. | |
Most securities listed on a foreign exchange are valued either at fair value (see description below) or at the last sale price at the close of the exchange on which the security is principally traded. Foreign securities, currencies, and other assets and liabilities denominated in foreign currencies are translated into U.S. dollars at the exchange rate of said currencies against the U.S. dollar, as of Valuation Time, as provided by an independent pricing service approved by the Board of Trustees. | |
Debt (including defaulted issues) and other fixed income securities (other than short-term obligations) are valued at the last quoted bid price and/or by using a combination of daily quotes and matrix evaluations provided by an independent pricing service, the use of which has been approved by the Board of Trustees. Short-term debt securities, such as commercial paper and U.S. Treasury Bills having a remaining maturity of 60 days or less at the time of purchase, are considered to be “short-term” and are valued at amortized cost, which approximates market value. | |
Securities for which market quotations are not readily available, or for which an independent pricing service does not provide a value or provides a value that does not represent fair value in the judgment of the Fund’s investment adviser or designee, are valued at fair value under procedures approved by the Board of Trustees. The “Fair Value” of these securities is determined in good faith by taking into account relevant factors and surrounding circumstances. Methods utilized to obtain a “Fair Value” may include the following non-exclusive list of acceptable methods: (i) a multiple of earnings; (ii) the discount from market value of a similar, freely traded security; (iii) the yield-to-maturity |
for debt issues; or (iv) a consolidation of the methods. The Trust’s Valuation & Operations Committee considers a non-exclusive list of factors to arrive at the appropriate method of determining “Fair Value.” For example, fair value determinations are required for securities whose value is affected by a “significant” event that materially affects the value of a domestic or foreign security which occurs subsequent to the time of the close of the principal market on which such domestic or foreign security trades and before the Valuation Time (i.e., a “subsequent event”). Typically, this will involve events occurring after the close of a foreign market on which a security trades and before the next Valuation Time. | |
The Fund values foreign securities at fair value in the circumstances described below. Generally, trading in foreign securities markets is completed each day at various times prior to the Valuation Time. Due to the time differences between the closings of the relevant foreign securities exchanges and the Valuation Time for the Fund, the Fund will fair value its foreign investments when it is determined that the market quotations for the foreign investments either are not readily available or are unreliable and, therefore, do not represent fair value. When the fair value prices are utilized, these prices will attempt to reflect the impact of the U.S. financial markets’ perceptions and trading activities on the Fund’s foreign investments since the last closing prices of the foreign investments were calculated on their primary foreign securities markets or exchanges. For these purposes, the Board of Trustees has determined that movements in relevant indices or other appropriate market indicators, after the close of the foreign securities exchanges, may demonstrate that market quotations are unreliable, and may trigger fair value pricing for certain securities. Consequently, fair valuation of portfolio securities may occur on a daily basis. |
(b) | Repurchase Agreements |
The Fund may enter into repurchase agreements with an entity which is a member of the Federal Reserve System or which is a “primary dealer” (as designated by the Federal Reserve Bank of New York) in U.S. Government obligations. The repurchase price generally equals the price paid by the Fund plus interest negotiated on the basis of current short-term rates, which may be more or less than the rate on the underlying portfolio securities. The seller under a repurchase agreement is required to maintain the value of the collateral held pursuant to the agreement at a market value equal to or greater than the repurchase price (including accrued interest). Collateral subject to repurchase agreements is held by the Fund’s custodian or another qualified sub-custodian or in the Federal Reserve/ Treasury book-entry system. If the counterparty defaults and the fair value of the collateral declines, realization of the collateral by the Fund may be delayed or limited. The Fund may transfer uninvested cash balances into a pooled cash account. These balances are invested in one or more repurchase agreements, with the counterparty of Nomura Securities, which is fully collateralized by U.S. Government Agency Mortgages. |
(c) | Futures Contracts |
The Fund may invest in financial futures contracts (“futures contracts”) for the purpose of hedging its existing portfolio securities or securities that the Fund intends to purchase against fluctuations in value caused by changes in prevailing market interest rates or prices. Futures contracts may also be entered into for non-hedging purposes. | |
Upon entering into a futures contract, the Fund is required to pledge to the broker an amount of cash and/or other assets equal to a certain percentage of the contract amount (initial margin deposit). Subsequent payments, known as “variation margin,” are made each day, depending on the daily fluctuations in the fair value/market value of the underlying assets. A gain or loss equal to the daily variation margin is recognized on a daily basis. Futures contracts are valued daily at their last quoted sale price. | |
A “sale” of a futures contract means the creation of a contractual obligation to deliver the securities or foreign currency called for by the contract at a fixed price at a specified time in the future. A “purchase” of a futures contract means the creation of a contractual obligation to acquire the securities or foreign currency at a fixed price at a specified time in the future. | |
Should market conditions change unexpectedly, the Fund may not achieve the anticipated benefits of the futures contracts and may realize a loss. The use of futures transactions for hedging purposes involves the risk of imperfect |
correlation in movements in the price of futures contracts, interest rates, and the value of the underlying hedged assets. |
(d) | Written Options Contracts |
The Fund may write options contracts. A written option obligates the Fund to deliver (written call) or to receive (written put) a specified quantity of an underlying asset at the contract amount upon exercise by the holder of the option. When the Fund writes an option, an amount equal to the premium received by the Fund is recorded as a liability and is subsequently adjusted to the current fair value of the option written. Premiums received from writing options that expire unexercised are treated by the Fund on the expiration date as realized gains from investments. The difference between the premium and the amount paid on effecting a closing purchase transaction, as a realized loss. If a call option is exercised, the premium is added to the proceeds from the sale of the underlying security or currency in determining whether the Fund has realized a gain or loss. If a put option is exercised, the premium reduces the cost basis of the securities purchased by the Fund. Options traded on an exchange are valued at the last quoted sale price, or in the absence of a sale, the bid price provided by an independent pricing service approved by the Board of Trustees. Non-exchange traded options are valued using dealer supplied quotes. The Fund as a writer of an option bears the market risk of an unfavorable change in the price of the security underlying the written option. |
(e) | Security Transactions and Investment Income |
Security transactions are accounted for on the date the security is purchased or sold (“trade date”). Securities gains and losses are calculated on the identified cost basis. Interest income is recognized on the accrual basis and includes, where applicable, the amortization or accretion of premium or discount. Dividend income is recorded on the ex-dividend date. |
(f) | Securities Lending |
To generate additional income, the Fund may lend its portfolio securities, up to 33 1/3% of the Fund, to brokers, dealers and other financial institutions provided that (1) the borrower delivers cash or securities as collateral with respect to each new loan of U.S. securities, equal to at least 102% of the value of the portfolio securities loaned, and with respect to each new loan on non-U.S. securities, collateral of at least 105% of the value of the portfolio securities loaned; and (2) at all times thereafter shall require the borrower to mark-to-market the collateral on a daily basis so that the market value of such collateral does not fall below 100% of the value of securities loaned. The Fund receives payments from borrowers equivalent to the dividends and interest that would have been earned on securities loaned while simultaneously seeking to earn income on the investment of cash collateral. There may be risks of delay in recovery of the securities should the borrower of the securities fail financially. Loans will be made, however, only to borrowers deemed by the Fund’s investment adviser to be of good standing and creditworthy under guidelines established by the Board of Trustees and when, in judgment of the adviser, the consideration which can be earned currently from these securities loans justifies the attendant risks. Loans are subject to termination by the Fund or the borrower at any time, and, therefore, are not considered to be illiquid investments. JPMorgan Chase Bank serves as custodian for the securities lending program of the Fund. JPMorgan Chase Bank receives a fee based on the value of the collateral received from borrowers. | |
Information on the investment of cash collateral is shown in the Statement of Investments. | |
As of June 30, 2007, the Fund had securities with the following value on loan: |
Value of | ||||||
Value of Loaned Securities | Collateral | |||||
$105,633,249 | $ | 107,659,700 | ||||
(g) | Distributions to Shareholders |
The Fund’s dividends from net investment income, if any, are declared and paid quarterly. The Fund’s distributions from net realized capital gains, if any, are declared and distributed at least annually. | |
Dividends and distributions to shareholders are determined in accordance with federal income tax regulations, which may differ from GAAP. These “book/tax” differences are considered either permanent or temporary in nature. In accordance with the American Institute of Certified Public Accountants Statement of Position 93-2, permanent differences (i.e., reclassification of market discounts, foreign exchange gain/loss, paydowns, and distributions from real estate investment trusts) are reclassified within the capital accounts based on their nature for federal income tax purposes; temporary differences do not require reclassification. These reclassifications have no effect upon the net asset value of the Fund. To the extent distributions exceed current and accumulated earnings and profits for federal income tax purposes, these distributions are reported as distributions of paid-in-capital. |
(h) | Federal Income Taxes |
It is the policy of the Fund to qualify or to continue to qualify as a “regulated investment company” by complying with the provisions available to certain investment companies, as defined in Subchapter M of the U.S. Internal Revenue Code, and to make distributions of net investment income and net realized capital gains sufficient to relieve the Fund from all, or substantially all, federal income taxes. | |
As of June 30, 2007, the tax cost of securities and the breakdown of unrealized appreciation (depreciation) for the Fund was as follows: |
Net Unrealized | ||||||||||||||||
Tax Cost of | Unrealized | Unrealized | Appreciation | |||||||||||||
Securities | Appreciation | Depreciation | (Depreciation) | |||||||||||||
$ | 2,007,217,795 | $ | 119,320,990 | $ | (32,864,999 | ) | $ | 86,455,991 | ||||||||
(i) | Allocation of Expenses, Income, and Gains and Losses |
Expenses directly attributable to the Fund are charged to the Fund. Expenses not directly attributable to the Fund are allocated proportionately among various or all funds within the Trust. The method used by the Fund for allocating income, fund level expenses, and realized and unrealized gains or losses is based on the fair value of shares outstanding relative to net assets. Under this method, each class of shares participates based on the total net asset value of that class’s shares in proportion to the total net assets of the Fund. Expenses specific to a class (such as Rule 12b-1 and administrative services fees) are charged to that class. |
3. Transactions with Affiliates
Under the terms of the Trust’s Investment Advisory Agreement, Nationwide Fund Advisors (formerly, Gartmore Mutual Fund Capital Trust (“GMF”)) (“NFA” or the “Advisor”) manages the investment of the assets and supervises the daily business affairs of the Fund. NFA is a wholly-owned subsidiary of Nationwide Financial Services (“NFS”).
Under the terms of the Investment Advisory Agreement, the Fund pays NFA an investment advisory fee based on the Fund’s average daily net assets and the following schedule:
Fee Schedule | Fees | |||||
Up to $250 million | 0.600% | |||||
On the next $750 million | 0.575% | |||||
On the next $1 billion | 0.550% | |||||
On the next $3 billion | 0.525% | |||||
On $5 billion or more | 0.500% | |||||
Under the terms of a Fund Administration and Transfer Agency Agreement, Nationwide Fund Management, LLC (formerly, Gartmore Investor Services, Inc. (“GISI”)), (“NFM”), a wholly-owned subsidiary of NFS Distributors, Inc. (“NFSDI”), provides the Fund with various administrative and accounting services for the Fund (prior to May 1, 2007, this service was provided by Gartmore SA Capital Trust (“GSA”)), and serves as Transfer and Dividend Disbursing Agent for the Fund (prior to May 1, 2007, this service was provided by GISI, an indirect subsidiary of GSA.) The fees for the services provided under this Agreement are calculated based on the Trust’s average daily net assets according to the fee schedule below. The fees are then allocated proportionately among all funds within the Trust in relation to the average daily net assets of each fund and are paid to NFA. NFA pays NFM from these fees for NFM’s services.
Combined Fee Schedule* | ||||||
Up to $1 billion | 0.15% | |||||
$1 billion up to $3 billion | 0.10% | |||||
$3 billion up to $8 billion | 0.05% | |||||
$8 billion up to $10 billion | 0.04% | |||||
$10 billion up to $12 billion | 0.02% | |||||
$12 billion or more | 0.01% | |||||
* | The assets of the Nationwide NVIT Investor Destinations Aggressive Fund, the Nationwide NVIT Investor Destinations Moderately Aggressive Fund, the Nationwide NVIT Investor Destinations Moderate Fund, the Nationwide NVIT Investor Destinations Moderately Conservative Fund, and the Nationwide NVIT Investor Destinations Conservative Fund (collectively, the “Investor Destinations Funds”) are excluded from the Trust asset level amount in order to calculate this asset-based fee. The Investor Destinations Funds do not pay any part of this fee. |
NFA and NFM have entered into agreements with Citi Fund Services Ohio, Inc. (“Citi”), pursuant to which Citi provides sub-administration and sub-transfer agency services, respectively, to the Fund. Effective August 1, 2007, The BISYS Group Inc. was acquired by and became a wholly owned subsidiary of Citi.
Under the terms of a Distribution Plan under Rule 12b-1 of the 1940 Act, Nationwide Fund Distributors, LLC. (formerly, “Gartmore Distribution Services, Inc.”) (“NFD” or “Distributor”), the Fund’s principal underwriter, is compensated by the Fund for expenses associated with the distribution of the Class II shares of the Fund. NFD is a majority-owned subsidiary of NFSDI. These fees are based on average daily net assets of Class II shares of the Fund at an annual rate not to exceed 0.25%.
Under the terms of an Administrative Services Plan, the Fund may pay fees to servicing organizations, such as broker-dealers, including NFS, and financial institutions, which agree to provide administrative support services to the shareholders of certain classes. These services include, but are not limited, to the following: establishing and maintaining shareholder accounts; processing purchase and redemption transactions; arranging bank wires; performing shareholder sub-accounting; answering inquires regarding the Fund; and other such services. These fees are based on an annual rate of up to 0.25% of the average daily net assets of Class I, Class II, and Class III shares of the Fund and 0.20% of Class IV shares of the Fund.
For the six months ended June 30, 2007, NFS received $1,421,012 in Administrative Services Fees from the Fund.
Under the terms of a letter agreement dated September 12, 2006, by and among NFA, the Audit Committee of the Trust and the Trust, the Trust has agreed to reimburse NFA certain costs related to the Fund’s portion of ongoing administration, monitoring and annual (audit) testing of the Trust’s Rule 38a-1 Compliance Program subject to the pre-approval of the Trust’s Audit Committee. For the six months ended June 30, 2007, the Fund’s portion of such costs amounted to $2,874.
4. Short-Term Trading Fees
The Fund reserves the right to assess a short-term trading fee on certain transactions out of Class III shares that a separate account makes on behalf of a variable insurance contract owner (the “contract owner”). A separate account that redeems
For the six months ended June 30, 2007, the Fund had no contributions to capital due to collection of redemption fees.
5. Investment Transactions
For the six months ended June 30, 2007, (excluding short-term securities) the Fund had purchases of $3,689,254,960 and sales of $3,741,795,079.
6. Bank Loans and Earnings Credit
The Trust has a credit agreement with JPMorgan Chase & Co., the Fund’s custodian bank, permitting the Trust to borrow up to $100,000,000. Borrowings under this arrangement bear interest at the Federal Funds rate plus 0.50%. The interest costs, if any, would be included in other fees in the Statement of Operations. No compensating balances were required under the terms of the line of credit. The line of credit is renewed annually, expiring on June 25, 2008, with a commitment fee of 0.07% per year on $100,000,000. There were no borrowings outstanding under this line of credit for the six months ended June 30, 2007.
The Trust’s custodian bank has agreed to reduce the bank’s fees (earnings credit) when the funds of the Trust maintain cash on deposit in non-interest-bearing custody and Demand Deposit Accounts. Earnings credits, if any, are shown as a reduction of total expenses on the Statement of Operations.
7. Portfolio Investment Risks
Risks Associated with Foreign Securities and Currencies. Investments in securities of foreign issuers carry certain risks not ordinarily associated with investments in securities of U.S. issuers. These risks include future political and economic developments, and the possible imposition of exchange controls or other foreign governmental laws and restrictions. In addition, with respect to certain countries, there is the possibility of expropriation of assets, confiscatory taxation, political or social instability, or diplomatic developments, which could adversely affect investments in those countries.
Certain countries also may impose substantial restrictions on investments in their capital markets by foreign entities, including restrictions on investments in issuers of industries deemed sensitive to relevant national interests. These factors may limit the investment opportunities available and result in a lack of liquidity and high price volatility with respect to securities of issuers from developing countries.
8. Indemnifications
Under the Trust’s organizational documents, certain of the Trust’s Officers and Trustees are indemnified against certain liabilities arising out of the performance of their duties to the Trust. In addition, the Trust has entered into Indemnification Agreements with the Trust’s trustees and certain officers covering similar liabilities. Trust Officers receive no compensation from the Trust for serving as the Trust’s Officers. In addition, in the normal course of business, the Trust enters into contracts with its vendors and others that provide for general indemnifications. The Trust’s maximum exposure under these arrangements is unknown, as this would involve future claims that may be made against the Trust. Based on experience, however, the Trust expects that risk of loss to be remote.
9. Recently Issued Accounting Pronouncements
On July 13, 2006, the Financial Accounting Standards Board (“FASB”) released FASB Interpretation No. 48, Accounting for Uncertainty in Income Taxes (“FIN 48”). FIN 48 provides guidance for how uncertain tax positions should be
In September 2006, the FASB issued Statement on Financial Accounting Standards (“SFAS”) No. 157, “Fair Value Measurements.” This standard establishes a single authoritative definition of fair value, sets out a framework for measuring fair value and requires additional disclosures about fair value measurements. SFAS No. 157 applies to fair value measurements already required or permitted by existing standards. SFAS No. 157 is effective for financial statements issued for fiscal years beginning after November 15, 2007 and interim periods within those fiscal years. The changes to current accounting principles generally accepted in the United States of America from the application of this Statement relate to the definition of fair value, the methods used to measure fair value, and the expanded disclosures about fair value measurements. As of June 30, 2007, the Fund does not believe the adoption of SFAS No. 157 will impact the financial statement amounts; however, additional disclosures may be required about the inputs used to develop the measurements and the effect of certain of the measurements on changes in net assets for the period.
Trustees who are not Interested Persons (as defined in the 1940 Act) and Officers of the Trust as of
Number of Portfolios | ||||||||||
Position(s) Held | in the | |||||||||
with the Trust | Principal Occupation(s) | Nationwide Fund | Other | |||||||
Name, Address | and Length of | During Past | Complex Overseen | Directorships | ||||||
and Year of Birth | Time Served1 | Five Years | by Trustee | Held by Trustee2 | ||||||
Charles E. Allen c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1948 | Trustee since July 2000 | Mr. Allen is Chairman, Chief Executive Officer and President of Graimark Realty Advisors, Inc. (real estate development, investment and asset management). | 89 | None | ||||||
Paula H.J. Cholmondeley c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1947 | Trustee since July 2000 | Ms. Cholmondeley was Vice President and General Manager of Sappi Fine Paper North America from April 2000 through December 2003. | 89 | Director of Dentsply International, Inc. (dental products), Ultralife Batteries, Inc., Terex Corporation (construction equipment), Minerals Technology, Inc. (specialty chemicals) and Albany International Corp. (paper industry) | ||||||
C. Brent DeVore3 c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1940 | Trustee since 1990 | Dr. DeVore is President of Otterbein College. | 89 | None | ||||||
Phyllis Kay Dryden c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1947 | Trustee since December 2004 | Ms. Dryden was a partner of Mitchell Madison, a management consulting company from January 2006 until December 2006; she is currently a consultant with the company. Ms. Dryden was formerly Managing Partner of march FIRST, a global management consulting firm. | 89 | None | ||||||
Barbara L. Hennigar c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1935 | Trustee since July 2000 | Retired. | 89 | None | ||||||
Number of Portfolios | ||||||||||
Position(s) Held | in the | |||||||||
with the Trust | Principal Occupation(s) | Nationwide Fund | Other | |||||||
Name, Address | and Length of | During Past | Complex Overseen | Directorships | ||||||
and Year of Birth | Time Served1 | Five Years | by Trustee | Held by Trustee2 | ||||||
Barbara I. Jacobs c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1950 | Trustee since December 2004 | Ms. Jacobs served as Chairman of the Board of Directors of KICAP Network Fund, a European (United Kingdom) hedge fund, from January 2001 through January 2006. From 1998-2003, Ms. Jacobs was also a Managing Director and European Portfolio Manager of CREF Investments (Teachers Insurance and Annuity Association-College Retirement Equities Fund). | 89 | None | ||||||
Douglas F. Kridler c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1955 | Trustee since September 1997 | Mr. Kridler has served as the President and Chief Executive Officer of the Columbus Foundation (a Columbus, OH-based foundation which manages over 1,300 individual endowment funds) since February 2002. Prior to January 31, 2002, Mr. Kridler was the President of the Columbus Association for the Performing Arts and Chairman of the Greater Columbus Convention and Visitors Bureau. | 89 | None | ||||||
Michael D. McCarthy c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1947 | Trustee since December 2004 | Retired. Mr. McCarthy was Chairman of VMAC (commodity swaps) from October 2002 until January 2007; and a partner of Pineville Properties LLC (a commercial real estate development firm) from September 2000 until January 2007. | 89 | None | ||||||
David C. Wetmore c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1948 | Trustee since 1995 and Chairman since February 2005 | Retired. | 89 | None | ||||||
1 | Length of time served includes time served with the Trust’s predecessors. | |
2 | Directorships held in (1) any other investment companies registered under the 1940 Act, (2) any company with a class of securities registered pursuant to Section 12 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or (3) any company subject to the requirements of Section 15(d) of the Exchange Act. | |
3 | Mr. DeVore has served as President of Otterbein College since 1984. Mark Thresher, President and Chief Operating Officer of Nationwide Financial Services, Inc. (“NFS”) has served as a member of the Board of Trustees of Otterbein College since 2000, currently serves as one of 30 of its trustees, and is currently one of two Vice Chairmen of the Board. Each of Nationwide Fund Advisors (“NFA”), the Funds’ investment adviser, and Nationwide Fund Distributors LLC (“NFD”), principal underwriter to the Trust, is a wholly-owned subsidiary of NFS. | |
Additional information regarding the Trustees and Officers may be found in the Trust’s Statement of Additional Information, which is available without charge upon request, by calling 800-848-0920. |
Trustees who are Interested Persons (as defined in the 1940 Act) and/or Officers of the Trust as of
Number of Portfolios | ||||||||||
Position(s) Held | in the | |||||||||
with the Trust | Principal Occupation(s) | Nationwide Fund | Other | |||||||
Name, Address | and Length of | During Past | Complex Overseen | Directorships | ||||||
and Year of Birth | Time Served1 | 5 Years | by Trustee | Held by Trustee 2 | ||||||
Arden L. Shisler c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1941 | Trustee since February 2000 | Retired. Mr. Shisler is the former President and Chief Executive Officer of KeB Transport, Inc., a trucking firm (2000 through 2002). He served as a consultant to KeB from January 2003 through December 2004. Since 1992, Mr. Shisler has also been Chairman of the Board for Nationwide Mutual Insurance Company.3 | 89 | Director of Nationwide Financial Services, Inc., Chairman of Nationwide Mutual Insurance Company3 | ||||||
John H. Grady Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1961 | President & Chief Executive Officer since December 2006 | Mr. Grady is President, and Chief Executive Officer of Nationwide Funds Group which includes Nationwide Fund Advisors,3 Nationwide Fund Management LLC,3 Nationwide Fund Distributors LLC 3 and NWD Investments,2 the asset management operations of Nationwide Mutual Insurance Company, which includes Morley Capital Management, Inc.,2 Nationwide Separate Accounts LLC,2 NorthPointe Capital LLC,2 and Nationwide SA Capital Trust2. From March 2004 until March 2006, Mr. Grady was Chief Executive Officer of Constellation Investment Management Co., L.P. (registered investment adviser), and President and Chief Executive Officer of Constellation Funds Group (registered investment companies). He also was President of Constellation Investment Distribution Co., Inc. (registered broker-dealer) from March 2004 until June 2006. From February 2001 until February 2004, Mr. Grady was Chief Operating and Chief Legal Officer; Managing Director, Mutual Funds Group, Turner Investment Partners, Inc. (registered investment adviser); Executive Vice President of Turner Funds and Turner Institutional Portfolios (registered investment companies); and President, Turner Investment Distributors, Inc. (registered broker-dealer). | N/A | None | ||||||
Gerald J. Holland Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1951 | Treasurer since March 2001 | Mr. Holland is Senior Vice President—Operations for Nationwide Funds Group3. | N/A | N/A | ||||||
Number of Portfolios | ||||||||||
Position(s) Held | in the | |||||||||
with the Trust | Principal Occupation(s) | Nationwide Fund | Other | |||||||
Name, Address | and Length of | During Past | Complex Overseen | Directorships | ||||||
and Year of Birth | Time Served1 | 5 Years | by Trustee | Held by Trustee 2 | ||||||
Michael A. Krulikowski Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1959 | Chief Compliance Officer from June 2004 to August 20074 | Mr. Krulikowski is Vice President and Chief Compliance Officer of Nationwide Funds Group3, Morley Capital Management, Inc.3, Nationwide SA Capital Trust (since 1999)3, and Nationwide Separate Accounts LLC (since August 2005).3 Since June 2004, Mr. Krulikowski has also served as Chief Compliance Officer of the Trust. From November 1999 through May 2007, he served as Vice President and Chief Compliance Officer of NorthPointe Capital LLC. 3 | N/A | N/A | ||||||
Eric E. Miller Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1953 | Secretary since December 2002 | Mr. Miller is Senior Vice President, General Counsel, and Assistant Secretary for Nationwide Funds Group3 and NWD Investments.2 From August 2000 to August 2002, Mr. Miller was a Partner with Stradley Ronon Stevens & Young, LLP. | N/A | N/A | ||||||
1 | Length of time served includes time served with the Trust’s predecessors. | |
2 | Directorships held in (1) any other investment companies registered under the 1940 Act, (2) any company with a class of securities registered pursuant to Section 12 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or (3) any company subject to the requirements of Section 15(d) of the Exchange Act. | |
3 | This position is held with an affiliated person or principal underwriter of the Trust. | |
4 | Effective August 3, 2007, the Board of Trustees approved Carol Baldwin Moody as Chief Compliance Officer of the Trust. Since November 2005, Ms. Moody has been Senior Vice President, Chief Compliance Officer of Nationwide Financial Services, Nationwide Life Insurance Company, Nationwide Life and Annuity Insurance Company, and Nationwide Investment Advisors, LLC. From February 2004-November 2005, she was Chief Compliance Officer of TIAA-CREF and from April 2000-February 2004, she was Managing Director and General Counsel, TCW/ Latin America Partners, LLC and Baeza & Co., LLC. | |
Federal law requires the Trust, each of its investment advisers and sub-advisers to adopt procedures for voting proxies (“Proxy Voting Guidelines”) and to provide a summary of those Proxy Voting Guidelines used to vote the securities held by the Funds. The Funds’ proxy voting policies and procedures are available without charge (i) upon request, by calling 800-848-0920, (ii) on the Funds’ website at www.nationwidefunds.com, or (iii) on the Securities and Exchange Commission’s website at www.sec.gov. |
A. | Renewal of Investment Advisory Agreement |
(i) General Information Regarding the Board’s Review of Investment Advisory Agreements
The Trust’s investment advisory agreements (each an “Advisory Agreement”) with its investment adviser and, as applicable, sub-advisers (together, the “Adviser”) must be approved for an initial term no greater than two years, and renewed at least annually thereafter, (i) by the vote of the Trustees or by a vote of the shareholders of each series or fund of the Trust (individually a “Fund” ), and (ii) by the vote of a majority of the Trustees who are not parties to the Advisory Agreement or “interested persons” of any party thereto (the “Independent Trustees”) cast in person at a meeting called for the purpose of voting on such approval.
The Board meets quarterly and takes into account throughout the year matters bearing on each Fund’s Advisory Agreement. The Board and its standing committees consider at each meeting factors that are relevant to the annual renewal of an Advisory Agreement, including the services and support provided to a Fund and its shareholders.
On December 6, 2006, the Independent Trustees first met in person with their independent legal counsel (“Independent Legal Counsel”) to consider information provided by the Adviser and others to assist the Trustees in considering whether to renew each Fund’s Advisory Agreement for a one year term beginning May 1, 2007. Immediately following such meeting of the Independent Trustees, all Trustees met in person with the Adviser, Trust counsel, Independent Legal Counsel and others to consider such matters, and give preliminary consideration to information bearing on continuation of each Advisory Agreement. The primary purpose of the December 6 and 7, 2006 meeting was to ensure that the Trustees had ample opportunity to consider matters they deemed relevant in considering the continuation of an Advisory Agreement, and to request any additional information they considered reasonably necessary to their deliberations.
In preparation for the December 6 and 7, 2006 meeting the Trustees were provided, at the request of the Trustees, with a wide range of information to assist in their deliberations, including (i) reports from Lipper Inc. describing a Fund’s (a) performance rankings (where “first quintile” denotes the best performance) (over multiple years ended September 30, 2006) compared with performance groups and performance universes created by Lipper (and in some cases, customized peer groups created by the Adviser) of similar or peer group funds, and (b) expense rankings (where “first quintile” denotes the lowest fees and expenses) comparing the Fund’s contractual advisory fee and total expenses with expense groups and expense universes created by Lipper of similar or peer group funds, (ii) information from the Adviser describing the Fund’s performance (over multiple years ended September 30, 2006) compared with its benchmark and Lipper categories, (iii) for Funds under “close review,” copies of letters from the Adviser to the portfolio manager of each such Fund, together with the portfolio manager’s written response describing the reasons for the Fund’s underperformance (iv) information from the Adviser describing performance for the months of October and November, 2006, and annual performance for the year ended November 30, 2006, (v) reports from the Adviser describing the Adviser’s profitability in providing services under an Advisory Agreement, together with an explanation of Adviser’s methodology in calculating its profitability, (vi) information from the Adviser describing any fees paid to the Adviser for managing similar, non-affiliated institutional accounts, including the range of fee levels for such accounts, and (vii) information from the Adviser describing ancillary benefits, in addition to fees for serving as investment adviser, derived by the Adviser as a result of being investment adviser for a Fund, including, where applicable, information on soft-dollar benefits and fees inuring to the Adviser’s affiliates for serving as the Trust’s administrator, fund accountant and transfer agent.
At the December 6 and 7, 2006 meeting, the Trustees reviewed, considered and discussed, among themselves and with the Adviser, Trust counsel and Independent Legal Counsel, among other things, the information described above, and: (i) the nature, extent and quality of services provided by the Adviser under each Advisory Agreement, (ii) the investment performance of each Fund and the Adviser, (iii) the costs of the services provided by the Adviser under the Advisory Agreement and the profits realized by the Adviser thereunder, (iv) the extent to which economies of scale may be present and, if so, whether they are being shared with a Fund’s shareholders, (v) comparisons of the Adviser’s fees under the Advisory Agreement with investment advisory fees paid by peer group funds to their investment advisers and paid by non-affiliated institutional clients to the Adviser for managing similar accounts, and (vi) any ancillary benefits inuring to the Adviser and its affiliates as a result of being investment adviser for the Trust. The Trustees also considered, where
As part of the December 6 and 7, 2006 Board meeting, the Independent Trustees developed a list of follow-up matters and questions and asked that Adviser respond to such matters and questions at the contract approval meeting of the Board of Trustees to be held on January 11, 2007.
At the January 11, 2007 meeting of the Board of Trustees of the Trust, the Board received and considered information provided by the Adviser in follow-up from the December 6 and 7, 2006 Board meeting and, after consulting among themselves, and with the Adviser, Trust counsel and Independent Legal Counsel, concluded unanimously to renew the Advisory Agreement for the reasons set forth in the following section. In determining whether to renew the Advisory Agreement for the Fund, the Board ultimately reached a determination, with the assistance of Trust counsel and Independent Legal Counsel, that the renewal of the Advisory Agreement and the compensation to be received by the Adviser under the Advisory Agreement is consistent with the Board’s fiduciary duty under applicable law.
(ii) | Board Conclusions Regarding the Fund’s Advisory Agreement |
The Board considered that the Fund had underperformed its benchmark, the S&P 500 Index, over the one- and three-year periods, while outperforming the benchmark for the five-year period. The Board also considered that performance of the Fund’s Class I shares ranked the Fund in the fourth quintile over the one-year period, the second quintile over the two- and four year period, the third quintile over the three-year period, and the first quintile over the five-year period compared to that of its Lipper-constructed Performance Group. The Board considered that: (i) longer-term relative performance has been strong; (ii) the Fund’s adviser had made changes to the portfolio management team during the year; and (iii) recent performance has shown improvement. Based on its review, and giving particular weight to the nature and quality of the resources dedicated by the adviser to improve relative performance, the Board concluded that the nature, extent and quality of services provided to the Fund will benefit the Fund’s shareholders.
The Board also considered that the Fund’s contractual advisory fee and breakpoints placed the Fund in the third quintile of its Lipper-constructed Expense Group and the Fund’s total expenses placed the Fund in the second quintile. The Board concluded the Fund’s management fee and total expenses were fair and reasonable in light of the services the Fund receives and the other factors considered.
The Board considered that the Fund’s adviser reported a pre-tax profit margin for investment management services for during the twelve month-periods ended September 30, 2006 and 2005. The Board also considered the costs of the services provided and the amounts of the profits realized by the adviser and determined the amount of profit is a fair entrepreneurial profit for management of the Fund.
Based upon its evaluation of all of the conclusions noted above, and after considering all material factors with respect to the Fund, the Board ultimately concluded that the advisory fee structure is fair and reasonable, and that the Advisory Agreement (and, if applicable, Sub-Advisory Agreement) with respect to the Fund, should be renewed.
B. Approval of New Advisory Agreement
At its January 11, 2007 meeting, the Board also unanimously approved a new investment advisory agreement (the “New Agreement”) for the Fund with Nationwide Fund Advisors, (“NFA”) the then-current adviser to each of the series of the Trust to become effective upon the closing of the acquisition of NFA by Nationwide Financial Services, Inc. (“NFS”) from Nationwide Corporation (“NWC”) which closed on April 30, 2007 (the “Transaction”). In approving the New Agreement, the Board considered NFA’s capacity to continue to provide the services needed to operate a sophisticated investment management business and to support the management of each of the series. The Board also took into account the information provided to them at their regular quarterly meetings with NFA’s senior management with respect to the Fund, including the information provided by management at the Fund’s annual Section 15(c) meetings on
C. Submission of Matters to a Vote of Security Holders:
On April 25, 2007, a Special Meeting of Shareholders was held* (the “April 25 Meeting”) at which shareholders of the Funds** set forth below were asked:
Proposal 1:
To approve a new investment advisory agreement, on behalf of their Fund, between Nationwide Fund Advisors (formerly “Gartmore Mutual Fund Capital Trust”) (the “Adviser”) and Nationwide Variable Insurance Trust (formerly “Gartmore Variable Insurance Trust”) (the “Trust”).
Number of Shares | ||||||
Fund | Cast/Not Cast | Percentages | ||||
Federated NVIT High Income Bond Fund (Formerly Federated GVIT High Income Bond Fund) | FOR AGAINST ABSTAIN TOTAL | 30,051,703.188 shares 618,245.021 shares 1,813,550.431 shares 32,483,498.640 shares | 92.514% 1.903% 5.583% | |||
NVIT International Index Fund (Formerly GVIT International Index Fund) | FOR AGAINST ABSTAIN TOTAL | 4,322,203.982 shares 2,758.318 shares 135,636.840 shares 4,460,599.140 shares | 96.897% 0.062% 3.041% | |||
NVIT International Value Fund (Formerly GVIT International Value Fund) | FOR AGAINST ABSTAIN TOTAL | 20,032,843.199 shares 333,588.902 shares 1,093,293.879 shares 21,459,725.980 shares | 93.351% 1.554% 5.095% | |||
NVIT Mid Cap Index Fund (Formerly GVIT Mid Cap Index Fund) | FOR AGAINST ABSTAIN TOTAL | 35,380,179.120 shares 631,117.844 shares 1,565,714.306 shares 37,577,011.270 shares | 94.154% 1.679% 4.167% | |||
NVIT S&P 500 Index Fund (Formerly GVIT S&P 500 Index Fund) | FOR AGAINST ABSTAIN TOTAL | 56,119,814.230 shares 666,195.542 shares 1,944,898.888 shares 58,730,908.660 shares | 95.554% 1.134% 3.312% |
Number of Shares | ||||||
Fund | Cast/Not Cast | Percentages | ||||
Nationwide Multi-Manager NVIT Small Cap Growth Fund (Formerly GVIT Small Cap Growth Fund) | FOR AGAINST ABSTAIN TOTAL | 7,632,918.513 shares 149,458.111 shares 451,583.036 shares 8,233,959.660 shares | 92.700% 1.816% 5.484% | |||
Nationwide Multi-Manager NVIT Small Cap Value Fund (Formerly GVIT Small Cap Value Fund) | FOR AGAINST ABSTAIN TOTAL | 48,649,396.525 shares 979,183.753 shares 2,786,133.102 shares 52,414,713.380 shares | 92.816% 1.868% 5.316% | |||
Nationwide Multi-Manager NVIT Small Company Fund (Formerly GVIT Small Company Fund) | FOR AGAINST ABSTAIN TOTAL | 29,903,181.700 shares 838,774.923 shares 2,006,741.307 shares 32,748,697.930 shares | 91.311% 2.561% 6.128% | |||
Gartmore NVIT Developing Markets Fund (Formerly Gartmore GVIT Developing Markets Fund) | FOR AGAINST ABSTAIN TOTAL | 21,0177,889.443 shares 424,272.958 shares 1,543,850.729 shares 23,046,013.130 shares | 91.460% 1.841% 6.699% | |||
Gartmore NVIT Emerging Markets Fund (Formerly Gartmore GVIT Emerging Markets Fund) | FOR AGAINST ABSTAIN TOTAL | 17,050,534.593 shares 526,574.722 shares 881,608.905 shares 18,458,718.220 shares | 92.371% 2.853% 4.776% | |||
Nationwide NVIT Global Financial Services Fund (Formerly Gartmore GVIT Global Financial Services Fund) | FOR AGAINST ABSTAIN TOTAL | 1,554,847.333 shares 19,539.033 shares 52,206.494 shares 1,626,592.860 shares | 95.589% 1.201% 3.210% | |||
Nationwide NVIT Global Health Sciences Fund (Formerly Gartmore GVIT Global Health Sciences Fund) | FOR AGAINST ABSTAIN TOTAL | 4,722,963.678 shares 157,979.030 shares 207,642.222 shares 5,088,584.930 shares | 92.815% 3.104% 4.081% | |||
Nationwide NVIT Global Technology and Communications Fund (Formerly Gartmore GVIT Global Technology and Communications Fund) | FOR AGAINST ABSTAIN TOTAL | 8,585,472.039 shares 102,267.977 shares 489,577.634 shares 9,177,317.650 shares | 93.551% 1.114% 5.335% | |||
Gartmore NVIT Global Utilities Fund (Formerly Gartmore GVIT Global Utilities Fund) | FOR AGAINST ABSTAIN TOTAL | 4,123,270.549 shares 122,001.533 shares 240,276.088 shares 4,485,548.170 shares | 91.923% 2.720% 5.357% | |||
Nationwide NVIT Government Bond Fund (Formerly Gartmore GVIT Government Bond Fund) | FOR AGAINST ABSTAIN TOTAL | 88,471,567.462 shares 1,825,645.181 shares 5,841,990.727 shares 96,139,203.370 shares | 92.024% 1.899% 6.077% | |||
Nationwide NVIT Growth Fund (Formerly Gartmore GVIT Growth Fund) | FOR AGAINST ABSTAIN TOTAL | 14,931,435.904 shares 409,826.402 shares 1,259,945.064 shares 16,601,207.370 shares | 89.942% 2.469% 7.589% |
Number of Shares | ||||||
Fund | Cast/Not Cast | Percentages | ||||
Gartmore NVIT International Growth Fund (Formerly Gartmore GVIT International Growth Fund) | FOR AGAINST ABSTAIN TOTAL | 6,251,419.070 shares 139,618.548 shares 290,025.592 shares 6,681,063.210 shares | 93.569% 2.090% 4.341% | |||
Nationwide NVIT Investor Destinations Aggressive Fund (Formerly Gartmore GVIT Investor Destinations Aggressive Fund) | FOR AGAINST ABSTAIN TOTAL | 49,489,224.549 shares 1,385,396.474 shares 3,696,272.337 shares 54,570,893.360 shares | 90.688% 2.539% 6.773% | |||
Nationwide NVIT Investor Destinations Conservative Fund (Formerly Gartmore GVIT Investor Destinations Conservative Fund) | FOR AGAINST ABSTAIN TOTAL | 23,091,965.887 shares 314,935,884 shares 2,292,355.179 shares 25,699,256.950 shares | 89.855% 1.225% 8.920% | |||
Nationwide NVIT Investor Destinations Moderate Fund (Formerly Gartmore GVIT Investor Destinations Moderate Fund) | FOR AGAINST ABSTAIN TOTAL | 188,902,093.059 shares 3,018,924.590 shares 16,359,690.401 shares 208,280,708.050 shares | 90.696% 1.449% 7.855% | |||
Nationwide NVIT Investor Destinations Moderately Aggressive Fund (Formerly Gartmore GVIT Investor Destinations Moderately Aggressive Fund) | FOR AGAINST ABSTAIN TOTAL | 134,792,622.920 shares 3,489,207.264 shares 9,304,197.656 shares 147,586,027.840 shares | 91.332% 2.364% 6.304% | |||
Nationwide NVIT Investor Destinations Moderately Conservative Fund (Formerly Gartmore GVIT Investor Destinations Moderately Conservative Fund) | FOR AGAINST ABSTAIN TOTAL | 49,627,123.216 shares 856,088.634 shares 3,507,215.650 shares 53,990,427.500 shares | 91.918% 1.586% 6.496% | |||
Nationwide NVIT Mid Cap Growth Fund (Formerly Gartmore GVIT Mid Cap Growth Fund) | FOR AGAINST ABSTAIN TOTAL | 10,879,584.971 shares 352,594.958 shares 717,792.971 shares 11,949,972.900 shares | 91.043% 2.950% 6.007% | |||
Nationwide NVIT Money Market Fund II (Formerly Gartmore GVIT Money Market Fund II) | FOR AGAINST ABSTAIN TOTAL | 221,774,863.241 shares 12,322,482.494 shares 16,471,740.875 shares 250,569,086.610 shares | 88.508% 4.918% 6.574% | |||
Nationwide NVIT Money Market Fund (Formerly Gartmore GVIT Money Market Fund) | FOR AGAINST ABSTAIN TOTAL | 1,578,331,008.328 shares 32,372,133.671 shares 112,652,123.301 shares 1,723,355,265.300 shares | 91.585% 1.878% 6.537% | |||
NVIT Nationwide Fund (Formerly Gartmore GVIT NationwideFund) | FOR AGAINST ABSTAIN TOTAL | 125,423,274.735 shares 2,767,979.467 shares 8,762,255.828 shares 136,953,510.030 shares | 91.581% 2.021% 6.398% | |||
NVIT Nationwide Leaders Fund (Formerly Gartmore GVIT Nationwide Leaders Fund) | FOR AGAINST ABSTAIN TOTAL | 2,298,504.956 shares 29,630.469 shares 71,637.755 shares 2,399,773.180 shares | 95.780% 1.235% 2.985% |
Number of Shares | ||||||
Fund | Cast/Not Cast | Percentages | ||||
Nationwide NVIT U.S. Growth Leaders Fund (Formerly Gartmore GVIT U.S. Growth Leaders Fund) | FOR AGAINST ABSTAIN TOTAL | 4,972,094.773 shares 122,623.161 shares 174,625.606 shares 5,269,343.540 shares | 94.359% 2.327% 3.314% | |||
Gartmore NVIT Worldwide Leaders Fund (Formerly Gartmore GVIT Worldwide Leaders Fund) | FOR AGAINST ABSTAIN TOTAL | 2,666,862.487 shares 47,702.491 shares 118,719.882 shares 2,833,284.860 shares | 94.126% 1.684% 4.190% | |||
J.P. Morgan NVIT Balanced Fund (Formerly J.P. Morgan GVIT Balanced Fund) | FOR AGAINST ABSTAIN TOTAL | 15,966,867.546 shares 259,004.324 shares 1,339,385.200 shares 17,565,257.070 shares | 90.900% 1.475% 7.625% | |||
Van Kampen NVIT Comstock Value Fund (Formerly Van Kampen GVIT Comstock Value Fund) | FOR AGAINST ABSTAIN TOTAL | 27,737,008.009 shares 502,564.164 shares 1,824,670.107 shares 30,064,242.280 shares | 92.259% 1.672% 6.069% | |||
Van Kampen NVIT Multi Sector Bond Fund (Formerly Van Kampen GVIT Multi Sector Bond Fund) | FOR AGAINST ABSTAIN TOTAL | 21,253,297.665 shares 484,100.920 shares 1,803,963.645 shares 23,541,362.230 shares | 90.281% 2.056% 7.663% | |||
At the April 25 Meeting, shareholders of the Nationwide NVIT Mid Cap Growth Fund were also asked to approve a new investment subadvisory agreement among the Adviser, the Trust and NorthPointe Capital LLC. The voting results with respect to that proposal are set forth below:
Proposal 2
Number of Shares | ||||||
Fund | Cast/Not Cast | Percentages | ||||
Nationwide NVIT Mid Cap Growth Fund (Formerly Gartmore GVIT Mid Cap Growth Fund) | FOR AGAINST ABSTAIN TOTAL | 10,862,827.499 shares 414,574.660 shares 672,570.741 shares 11,949,972.900 shares | 90.903% 3.469% 5.628% | |||
* | This meeting was previously adjourned on April 23, 2007. | |
** | Fund names were changed effective May 1, 2007 to reflect “Nationwide”/ “NVIT” branding to coincide with the sale of Nationwide Fund Advisors, Inc. by Nationwide Corporation to its majority-owned subsidiary, Nationwide Financial Services, Inc. |
June 30, 2007 (Unaudited)
Contents | ||
6 | Statement of Investments | |
8 | Statement of Assets and Liabilities | |
9 | Statement of Operations | |
10 | Statements of Changes in Net Assets | |
12 | Financial Highlights | |
14 | Notes to Financial Statements |
Statement Regarding Availability of Proxy Voting Record.
SAR-GB (8/07) | ![]() |
Dear Fellow Shareholder:
Since I last wrote to you, our mutual funds have enjoyed another period of solid performance, and the corporate realignment that was in progress is now finished.
On May 1, 2007, Nationwide Financial Services, Inc. (NFS), completed its acquisition of the Philadelphia-based retail mutual fund operations of NWD Investment Management, Inc. (formerly, “Gartmore Global Investments, Inc.”), from Nationwide Corporation, a subsidiary of Nationwide Mutual Insurance Company. Effective that date, the acquired entities were renamed Nationwide Funds Group (NFG), and the Gartmore Funds were renamed the Nationwide Funds to better align with the Nationwide® brand. Although the corporate ownership and fund names have changed, I can assure you that NFG intends to maintain as much continuity as possible with the Funds and key personnel.
Thank you, shareholders, for approving the new investment advisory agreement that was required due to the change in corporate ownership. The new agreement is identical in all material respects to the original agreement that it replaces, with the exception of the section pertaining to the vote by the shareholders of the NVIT Mid Cap Growth Fund to approve NorthPointe Capital®, LLC (NorthPointe) as sub-adviser to that particular Fund.
Market Overview: January 1-June 30, 2007
Share prices in general were buoyed in part by better-than-expected first-quarter 2007 earnings and a flurry of mergers and acquisitions, many of these spurred by readily available funding from private equity firms. In June, investors grew more cautious amid surging crude oil prices, a sudden spike in long-term interest rates, and the meltdown of two hedge funds that had exposure to the subprime mortgage market. Looking abroad, a weak U.S. dollar aided foreign stocks, as reflected in the 11.09% advance of the Morgan Stanley Capital International Europe, Australasia and Far East (MSCI EAFE®) Index. Emerging market performance was particularly robust.
The bond market struggled during the first half of 2007. While short-term interest rates remained stable, reflecting the Federal Reserve Board’s decision in June to leave the target federal funds rate at 5.25%, longer-term rates climbed during the first half of 2007, depressing bond prices and forcing the Lehman Brothers® U.S. Aggregate Index to settle for a modest 0.97% return.
We at NFG thank you for your understanding and cooperation throughout our recent transition period. We emerge from this period energized for the future, and we look forward to serving your investment needs for a long time to come.
Nationwide Funds Group
PAST PERFORMANCE IS NO GUARANTEE OF FUTURE RESULTS.
Nationwide Funds are advised by Nationwide Fund Advisors (NFA). NFA is a wholly-owned subsidiary of Nationwide Financial Services. Nationwide Financial Services is a wholly-owned subsidiary of Nationwide Corporation. All of the common stock of Nationwide Corporation is held by Nationwide Mutual (95.2%) and Nationwide Mutual Fire Insurance Company (4.8%), each of which is a mutual company owned by its policyholders.
Nationwide Funds Group (NFG) is the mutual fund arm of Nationwide Financial Services (NYSE: NFS). Based in Conshohocken, Pa., a suburb of Philadelphia, NFG is comprised of Nationwide Fund Advisors, Nationwide Fund Distributors, LLC, and Nationwide Fund Management, LLC. Together, these provide advisory, distribution, and administration services respectively to the Nationwide Funds, and manage more than $43.5 billion in assets as of June 30, 2007, of which more than $12 billion are in “fund of funds” designed to provide asset allocation across several types of investments and asset classes.
Lehman Brothers (LB) U.S. Aggregate Index: An unmanaged, market value-weighted index of investment-grade, fixed-rate debt issues (including government, corporate, asset-backed, and mortgage-backed securities with maturities of one year or more) that is generally representative of the bond market as a whole.
Morgan Stanley Capital International Europe, Australasia and Far East (MSCI EAFE®) Index: An unmanaged, free float-adjusted, market capitalization-weighted index that is designed to measure the performance of stocks in developed markets outside the United States and Canada.
Standard & Poor’s 500® (S&P 500) Index: An unmanaged, market capitalization-weighted index of 500 widely held stocks of large-cap U.S. companies that gives a broad look at how the stock prices of those companies have performed.
Views expressed within are those of Nationwide Funds Group as of the date noted, are subject to change at any time, and may not come to pass.
This report is for informational purposes only, and is not intended as an offer or recommendation with respect to the purchase or sale of any security, option, future, or other derivatives in such securities.
Investing in mutual funds involves risk, including possible loss of principal.
Investors should carefully consider a fund’s investment objectives, risks, fees, charges, and expenses before investing any money. To obtain this and other fund information, please call 800-848-0920 to request a prospectus, or download a prospectus at www.nationwidefunds.com. Please read the prospectus carefully before investing any money.
Nationwide Funds distributed by Nationwide Fund Distributors LLC (formerly Gartmore Distribution Services, Inc.), Member NASD. 1200 River Road, Suite 1000, Conshohocken, Pa. 19428.
As a shareholder of the Fund, you incur two types of costs: (1) transaction costs, including sales charges (loads) paid on purchase payments and redemption fees; and (2) ongoing costs, including investment advisory fees, administration fees, distribution fees and other Fund expenses. The examples below are 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. Per SEC requirements, the examples assume that you had a $1,000 investment in the Class at the beginning of the reporting period, January 1, 2007, and continued to hold your shares at the end of the reporting period, June 30, 2007.
Actual Expenses
Hypothetical Example for Comparison Purposes
Please note that the expenses shown in the table are meant to highlight your ongoing costs only and do not reflect any transaction costs, such as sales charges (loads) or redemption fees. Therefore, the second line for each Class in 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 transaction costs were included, your costs would have been higher. The examples also assume all dividends and distributions have been reinvested.
Schedule of Shareholder Expenses
Nationwide NVIT Government Bond Fund | ||||||||||||||||||||||
Beginning | Ending | Expenses Paid | Annualized | |||||||||||||||||||
Account Value, | Account | During Period* | Expense Ratio* | |||||||||||||||||||
January 1, 2007 | Value, | |||||||||||||||||||||
June 30, 2007 | ||||||||||||||||||||||
Class I | Actual | $ | 1,000.00 | $ | 1,012.70 | $ | 3.49 | 0.70% | ||||||||||||||
Hypothetical | 1 | $ | 1,000.00 | $ | 1,021.33 | $ | 3.51 | 0.70% | ||||||||||||||
Class II | Actual | $ | 1,000.00 | $ | 1,011.60 | $ | 4.74 | 0.95% | ||||||||||||||
Hypothetical | 1 | $ | 1,000.00 | $ | 1,020.09 | $ | 4.77 | 0.95% | ||||||||||||||
Class III | Actual | $ | 1,000.00 | $ | 1,012.80 | $ | 3.54 | 0.71% | ||||||||||||||
Hypothetical | 1 | $ | 1,000.00 | $ | 1,021.28 | $ | 3.56 | 0.71% | ||||||||||||||
Class IV | Actual | $ | 1,000.00 | $ | 1,012.70 | $ | 3.49 | 0.70% | ||||||||||||||
Hypothetical | 1 | $ | 1,000.00 | $ | 1,021.33 | $ | 3.51 | 0.70% | ||||||||||||||
* | Expenses are equal to the Fund’s annualized expense ratio multiplied by the average account value over the period multiplied by 181/365 (to reflect the one-half year period). The expense ratio presented represents a six-month, annualized ratio in accordance with SEC guidelines. The expenses reported above do not include the effect of additional expenses imposed by variable annuity contracts. | |
1 | Represents the hypothetical 5% return before expenses. |
Asset Allocation | ||||
U.S. Government Sponsored & Agency Obligations | 45.3% | |||
Mortgage-Backed Obligations | 39.7% | |||
U.S. Treasury Obligations | 9.5% | |||
Repurchase Agreements | 4.5% | |||
Other Investments* | 4.3% | |||
Liabilities in excess of other assets** | -3.3% | |||
100.0% |
Top Holdings*** | ||||
Federal National Mortgage Association, 5.23%, 01/29/10 | 9.1% | |||
Federal National Mortgage Association, 5.08%, 05/14/10 | 5.9% | |||
Federal National Mortgage Association, 4.66%, 05/01/13 | 4.7% | |||
Federal Home Loan Mortgage Corporation, 5.75%, 05/23/11 | 4.3% | |||
Federal Home Loan Bank, 5.25%, 11/03/09 | 4.3% | |||
Federal National Mortgage Association, 5.63%, 11/15/21 | 4.1% | |||
Federal National Mortgage Association, 5.30%, 01/12/10 | 3.4% | |||
Federal National Mortgage Association, 5.69%, 09/01/36 | 3.4% | |||
U.S. Treasury Bonds, 5.50%, 08/15/28 | 2.6% | |||
Federal National Mortgage Association, 4.90%, 07/01/35 | 2.6% | |||
Other | 55.6% | |||
100.0% |
* | Includes value of collateral received from securities lending. |
** | Includes value of collateral owed from securities lending. |
*** | For purpose of listing top holdings, repurchase agreements are included as part of Other. |
Nationwide NVIT Government Bond Fund
U.S. Government Sponsored & Agency Obligations (45.3%) | |||||||||
Principal | |||||||||
Amount | Value | ||||||||
Federal Farm Credit Bank | |||||||||
5.00%, 03/03/14 | $ | 12,146,000 | $ | 11,893,582 | |||||
4.55%, 03/04/15 | 25,475,000 | 24,127,092 | |||||||
Federal Home Loan Bank | |||||||||
5.91%, 04/07/09 | 6,860,000 | 6,946,601 | |||||||
5.25%, 11/03/09 | 50,000,000 | 49,906,300 | |||||||
5.00%, 03/14/14 (a) | 17,925,000 | 17,549,436 | |||||||
Federal Home Loan Mortgage Corporation | |||||||||
5.75%, 05/23/11 | 50,000,000 | 50,119,150 | |||||||
5.65%, 02/14/12 | 25,000,000 | 24,894,250 | |||||||
5.60%, 09/26/13 | 25,000,000 | 24,848,300 | |||||||
4.80%, 12/18/13 | 8,350,000 | 8,091,768 | |||||||
Federal National Mortgage Association | |||||||||
5.00%, 01/23/09 | 15,000,000 | 14,946,300 | |||||||
5.30%, 01/12/10 | 40,000,000 | 40,000,240 | |||||||
5.23%, 01/29/10 | 106,515,000 | 106,243,493 | |||||||
8.20%, 03/10/16 | 10,000,000 | 11,891,290 | |||||||
Pool #383452 | |||||||||
6.68%, 05/01/16 | 3,597,757 | 3,701,615 | |||||||
6.62%, 06/01/16 | 10,658,134 | 11,296,889 | |||||||
5.63%, 11/15/21 (a) | 50,000,000 | 48,716,750 | |||||||
Series 2003-66, Class AP | |||||||||
3.50%, 11/25/32 | 2,344,818 | 2,125,609 | |||||||
Financing Corporation | |||||||||
10.70%, 10/06/17 | 6,535,000 | 9,182,551 | |||||||
9.65%, 11/02/18 | 8,740,000 | 11,782,473 | |||||||
Government Loan Trust 0.00%, 04/01/15 | 6,072,000 | 4,031,298 | |||||||
Housing & Urban Development, 7.08%, 08/01/16 | 9,000,000 | 9,011,016 | |||||||
Lightship Tankers LLC, 6.50%, 06/14/24 | 28,450,365 | 30,307,036 | |||||||
Overseas Private Investment Corp., 5.86%, 09/20/07 | 8,632,326 | 9,399,480 | |||||||
Total U.S. Government Sponsored & Agency Obligations (Cost $534,351,913) | 531,012,519 | ||||||||
Mortgage-Backed Obligations (39.7%) | |||||||||
Principal | |||||||||
Amount | Value | ||||||||
Federal Home Loan Mortgage Corporation | |||||||||
8.00%, 11/01/08 | 1,045 | 1,047 | |||||||
5.50%, 09/15/10 | 3,451,247 | 3,447,852 | |||||||
5.50%, 08/15/13 | 5,726,498 | 5,717,140 | |||||||
5.50%, 07/15/17 | 7,090,438 | 7,054,311 | |||||||
5.50%, 10/15/17 | 18,750,000 | 18,589,155 | |||||||
5.50%, 10/15/17 | 14,331,348 | 14,274,418 | |||||||
5.50%, 01/15/20 | 8,000,000 | 7,946,599 | |||||||
5.50%, 05/15/34 | 12,333,715 | 12,253,901 | |||||||
5.31%, 06/01/35 (b) | 22,350,327 | 22,755,963 | |||||||
Federal National Mortgage Association | |||||||||
5.70%, 01/01/09 | 4,438,542 | 4,428,675 | |||||||
7.41%, 04/01/10 | 13,994,150 | 14,647,834 | |||||||
5.08%, 05/14/10 | 70,000,000 | 69,587,910 | |||||||
5.50%, 09/25/11 | 6,215,000 | 6,248,042 | |||||||
4.66%, 05/01/13 | 57,473,679 | 55,346,372 | |||||||
5.60%, 09/01/18 | 11,186,039 | 11,188,542 | |||||||
5.56%, 12/01/21 | 11,400,000 | 11,424,246 | |||||||
5.00%, 07/25/23 | 6,000,000 | 5,530,028 | |||||||
7.00%, 08/25/23 | 4,693,066 | 4,839,995 | |||||||
5.50%, 04/25/24 | 12,486,462 | 12,207,665 | |||||||
6.43%, 02/17/30 | 248,440 | 247,903 | |||||||
4.99%, 09/01/34 (b) | 14,793,824 | 14,585,140 | |||||||
4.71%, 04/01/35 | 8,856,042 | 8,742,341 | |||||||
4.74%, 04/01/35 (b) | 15,571,560 | 15,168,557 | |||||||
4.80%, 05/01/35 (b) | 13,542,654 | 13,186,774 | |||||||
4.89%, 05/01/35 | 18,760,982 | 18,287,780 | |||||||
5.24%, 05/01/35 (b) | 10,444,885 | 10,283,182 | |||||||
4.90%, 07/01/35 (b) | 31,099,082 | 30,350,338 | |||||||
6.00%, 04/18/36 | 9,822,000 | 9,688,833 | |||||||
6.31%, 08/01/36 | 8,425,224 | 8,708,974 | |||||||
5.69%, 09/01/36 (b) | 39,260,514 | 39,612,358 | |||||||
Vendee Mortgage Trust, Series 1996-2, 6.75%, 06/15/26 | 9,058,220 | 9,287,792 | |||||||
Total Mortgage-Backed Obligations (Cost $468,518,135) | 465,639,667 | ||||||||
U.S. Treasury Obligations (9.5%)(a) | |||||||||
Principal | |||||||||
Amount | Value | ||||||||
U.S. Treasury Bonds, 5.50%, 08/15/28 (a) | $ | 30,000,000 | $ | 31,122,660 | |||||
U.S. Treasury Inflation Protected Bonds, 1.88%, 07/15/15 | 30,000,000 | 30,124,710 | |||||||
U.S. Treasury Note | |||||||||
4.50%, 03/31/12 | 25,000,000 | 24,542,975 | |||||||
5.13%, 05/15/16 | 25,000,000 | 25,140,625 | |||||||
Total U.S. Treasury Obligations (Cost $111,796,619) | 110,930,970 | ||||||||
Repurchase Agreements (4.5%)(b) | |||||||||
Nomura Securities, 5.26% dated 06/29/07, due 07/02/07, Repurchase price $53,386,422, collateralized by U.S. Government Agency Mortgages with a market value of $54,430,292 | 53,363,031 | 53,363,031 | |||||||
Securities Held as Collateral for Securities on Loan (4.3%) | ||||||||
Principal | ||||||||
Amount | Value | |||||||
Morgan Stanley Repurchase Agreement, 5.42% dated 06/29/07, due 07/02/07, Repurchase price $50,235,228, collateralized by U.S. Government Agency Mortgages with a market value of $51,216,800 | 50,212,549 | 50,212,549 | ||||||
Total Investments (Cost $1,218,242,247) (c) — 103.3% | 1,211,158,736 | |||||||
Liabilities in excess of other assets — (3.3)% | (39,078,325 | ) | ||||||
NET ASSETS — 100.0% | $ | 1,172,080,411 | ||||||
(a) | All or a part of the security was on loan as of June 30, 2007. | |
(b) | Variable Rate Security. The rate reflected in the Statement of Investments is the rate in effect on June 30, 2007. The maturity date represents the actual maturity date. | |
(c) | See notes to financial statements for tax unrealized appreciation (depreciation) of securities. |
See accompanying notes to financial statements.
Nationwide NVIT | ||||||
Government Bond Fund | ||||||
Assets: | ||||||
Investments, at value (cost $1,114,666,667)* | $ | 1,107,583,156 | ||||
Repurchase agreements, at cost and value | 103,575,580 | |||||
Total Investments | 1,211,158,736 | |||||
Interest and dividends receivable | 11,640,468 | |||||
Receivable for capital shares issued | 976,877 | |||||
Prepaid expenses | 12,552 | |||||
Total Assets | 1,223,788,633 | |||||
Liabilities: | ||||||
Payable upon return of securities loaned | 50,212,549 | |||||
Payable for capital shares redeemed | 805,593 | |||||
Accrued expenses and other payables: | ||||||
Investment advisory fees | 456,013 | |||||
Fund administration and transfer agent fees | 78,445 | |||||
Distribution fees | 2,892 | |||||
Administrative servicing fees | 84,656 | |||||
Compliance program costs | 14,873 | |||||
Other | 53,201 | |||||
Total Liabilities | 51,708,222 | |||||
Net Assets | $ | 1,172,080,411 | ||||
Represented by: | ||||||
Capital | $ | 1,192,837,820 | ||||
Accumulated net investment income | 1,052,725 | |||||
Accumulated net realized losses from investment transactions | (14,726,623 | ) | ||||
Net unrealized depreciation on investments | (7,083,511 | ) | ||||
Net Assets | $ | 1,172,080,411 | ||||
Net Assets: | ||||||
Class I Shares | $ | 1,105,966,276 | ||||
Class II Shares | 14,069,286 | |||||
Class III Shares | 16,840,314 | |||||
Class IV Shares | 35,204,535 | |||||
Total | $ | 1,172,080,411 | ||||
Shares outstanding (unlimited number of shares authorized): | ||||||
Class I Shares | 98,419,579 | |||||
Class II Shares | 1,255,622 | |||||
Class III Shares | 1,498,412 | |||||
Class IV Shares | 3,133,295 | |||||
Total | 104,306,908 | |||||
Net asset value and offering price per share (Net assets by class divided by shares outstanding by class, respectively.): | ||||||
Class I Shares | $ | 11.24 | ||||
Class II Shares | $ | 11.20 | (a) | |||
Class III Shares | $ | 11.24 | ||||
Class IV Shares | $ | 11.23 | (a) | |||
(a) | The NAV reported above represents the traded NAV at June 30, 2007. Due to the financial statement rounding of class assets and class shares above, the NAV results in a different NAV than the traded NAV. | |
* | Includes value of securities on loan of $125,500,511. |
8
Nationwide NVIT | |||||
Government | |||||
Bond Fund | |||||
INVESTMENT INCOME: | |||||
Interest income | $ | 30,226,240 | |||
Income from securities lending | 77,717 | ||||
Total Income | 30,303,957 | ||||
Expenses: | |||||
Investment advisory fees | 2,737,500 | ||||
Fund administration and transfer agent fees | 352,666 | ||||
Distribution fees Class II Shares | 17,714 | ||||
Administrative servicing fees Class I Shares | 744,718 | ||||
Administrative servicing fees Class II Shares | 9,843 | ||||
Administrative servicing fees Class III Shares | 11,246 | ||||
Administrative servicing fees Class IV Shares | 23,815 | ||||
Custodian fees | 40,550 | ||||
Trustee fees | 26,465 | ||||
Compliance program costs (Note 3) | 7,829 | ||||
Other | 76,798 | ||||
Total expenses before earnings credit | 4,049,144 | ||||
Earnings credit (Note 6) | (14,357 | ) | |||
Net Expenses | 4,034,787 | ||||
Net Investment Income | 26,269,170 | ||||
REALIZED/ UNREALIZED GAINS (LOSSES) FROM INVESTMENTS: | |||||
Net realized losses on investment transactions | (6,621,181 | ) | |||
Net change in unrealized depreciation on investments | (5,405,777 | ) | |||
Net realized/unrealized gains (losses) on investments | (12,026,958 | ) | |||
CHANGE IN NET ASSETS RESULTING FROM OPERATIONS | $ | 14,242,212 | |||
9
Nationwide NVIT Government Bond Fund | |||||||||
Six Months Ended | Year Ended | ||||||||
June 30, 2007 | December 31, 2006 | ||||||||
(Unaudited) | |||||||||
FROM INVESTMENT ACTIVITIES: | |||||||||
Operations: | |||||||||
Net investment income | $ | 26,269,170 | $ | 46,791,958 | |||||
Net realized losses on investment transactions | (6,621,181 | ) | (5,728,146 | ) | |||||
Net change in unrealized depreciation on investments | (5,405,777 | ) | (4,645,687 | ) | |||||
Change in net assets resulting from operations | 14,242,212 | 36,418,125 | |||||||
Distributions to shareholders from: | |||||||||
Net investment income: | |||||||||
Class I | (24,618,135 | ) | (43,698,310 | ) | |||||
Class II | (300,445 | ) | (572,230 | ) | |||||
Class III | (367,979 | ) | (516,724 | ) | |||||
Class IV | (784,857 | ) | (1,501,214 | ) | |||||
Net realized gains on investments: | |||||||||
Class I | – | (8,191,701 | ) | ||||||
Class II | – | (116,493 | ) | ||||||
Class III | – | (91,621 | ) | ||||||
Class IV | – | (286,189 | ) | ||||||
Change in net assets from shareholder distributions | (26,071,416 | ) | (54,974,482 | ) | |||||
Change in net assets from capital transactions | 52,367,798 | (33,047,295 | ) | ||||||
Change in net assets | 40,538,594 | (51,603,652 | ) | ||||||
Net Assets: | |||||||||
Beginning of period | 1,131,541,817 | 1,183,145,469 | |||||||
End of period | $ | 1,172,080,411 | $ | 1,131,541,817 | |||||
Accumulated net investment income at end of period | $ | 1,052,725 | $ | 854,971 | |||||
CAPITAL TRANSACTIONS: | |||||||||
Class I Shares | |||||||||
Proceeds from shares issued | $ | 112,968,756 | $ | 140,608,879 | |||||
Dividends reinvested | 24,618,038 | 51,889,883 | |||||||
Cost of shares redeemed | (88,423,626 | ) | (224,541,127 | ) | |||||
49,163,168 | (32,042,365 | ) | |||||||
Class II Shares | |||||||||
Proceeds from shares issued | 348,001 | 722,519 | |||||||
Dividends reinvested | 300,445 | 688,721 | |||||||
Cost of shares redeemed | (912,518 | ) | (2,461,231 | ) | |||||
(264,072 | ) | (1,049,991 | ) | ||||||
Class III Shares | |||||||||
Proceeds from shares issued | 6,364,362 | 9,053,579 | |||||||
Dividends reinvested | 367,979 | 608,344 | |||||||
Cost of shares redeemed | (2,841,930 | ) | (6,936,325 | ) | |||||
3,890,411 | 2,725,598 | ||||||||
10
Nationwide NVIT Government Bond Fund | |||||||||
Six Months Ended | Year Ended | ||||||||
June 30, 2007 | December 31, 2006 | ||||||||
(Unaudited) | |||||||||
CAPITAL TRANSACTIONS: (continued) | |||||||||
Class IV Shares | |||||||||
Proceeds from shares issued | $ | 1,516,807 | $ | 3,006,094 | |||||
Dividends reinvested | 784,857 | 1,787,398 | |||||||
Cost of shares redeemed | (2,723,373 | ) | (7,474,029 | ) | |||||
(421,709 | ) | (2,680,537 | ) | ||||||
Change in net assets from capital transactions | $ | 52,367,798 | $ | (33,047,295 | ) | ||||
SHARE TRANSACTIONS: | |||||||||
Class I Shares | |||||||||
Issued | 9,893,149 | 12,340,128 | |||||||
Reinvested | 2,177,265 | 4,599,476 | |||||||
Redeemed | (7,761,266 | ) | (19,695,341 | ) | |||||
4,309,148 | (2,755,737 | ) | |||||||
Class II Shares | |||||||||
Issued | 30,577 | 63,762 | |||||||
Reinvested | 26,641 | 61,228 | |||||||
Redeemed | (80,253 | ) | (216,427 | ) | |||||
(23,035 | ) | (91,437 | ) | ||||||
Class III Shares | |||||||||
Issued | 555,521 | 795,336 | |||||||
Reinvested | 32,535 | 53,887 | |||||||
Redeemed | (249,474 | ) | (608,404 | ) | |||||
338,582 | 240,819 | ||||||||
Class IV Shares | |||||||||
Issued | 133,365 | 263,287 | |||||||
Reinvested | 69,413 | 158,474 | |||||||
Redeemed | (239,108 | ) | (656,078 | ) | |||||
(36,330 | ) | (234,317 | ) | ||||||
Total change in shares | 4,588,365 | (2,840,672 | ) | ||||||
11
Distributions | ||||||||||||||||||||
Investment Activities | ||||||||||||||||||||
Net Realized | ||||||||||||||||||||
and | ||||||||||||||||||||
Net Asset | Unrealized | Total | ||||||||||||||||||
Value, | Net | Gains | from | Net | ||||||||||||||||
Beginning | Investment | (Losses) on | Investment | Investment | ||||||||||||||||
of Period | Income | Investments | Activities | Income | ||||||||||||||||
Class I Shares | ||||||||||||||||||||
For the year ended December 31, 2002 | $ | 11.66 | 0.53 | 0.72 | 1.25 | (0.53 | ) | |||||||||||||
For the year ended December 31, 2003 (g) | $ | 12.28 | 0.50 | (0.25 | ) | 0.25 | (0.38 | ) | ||||||||||||
For the year ended December 31, 2004 | $ | 12.13 | 0.47 | (0.08 | ) | 0.39 | (0.66 | ) | ||||||||||||
For the year ended December 31, 2005 | $ | 11.62 | 0.43 | (0.06 | ) | 0.37 | (0.43 | ) | ||||||||||||
For the year ended December 31, 2006 | $ | 11.54 | 0.48 | (0.11 | ) | 0.37 | (0.47 | ) | ||||||||||||
For the six months ended June 30, 2007 (Unaudited) | $ | 11.35 | 0.25 | (0.11 | ) | 0.14 | (0.25 | ) | ||||||||||||
Class II Shares | ||||||||||||||||||||
Period ended December 31, 2002 (e) | $ | 11.88 | 0.18 | 0.55 | 0.73 | (0.26 | ) | |||||||||||||
For the year ended December 31, 2003 (g) | $ | 12.26 | 0.47 | (0.25 | ) | 0.22 | (0.36 | ) | ||||||||||||
For the year ended December 31, 2004 | $ | 12.10 | 0.44 | (0.08 | ) | 0.36 | (0.63 | ) | ||||||||||||
For the year ended December 31, 2005 | $ | 11.59 | 0.40 | (0.06 | ) | 0.34 | (0.40 | ) | ||||||||||||
For the year ended December 31, 2006 | $ | 11.51 | 0.45 | (0.11 | ) | 0.34 | (0.44 | ) | ||||||||||||
For the six months ended June 30, 2007 (Unaudited) | $ | 11.32 | 0.24 | (0.12 | ) | 0.12 | (0.24 | ) |
[Additional columns below]
[Continued from above table, first column(s) repeated]
Distributions | ||||||||||||||||||||||||
Ratio of | ||||||||||||||||||||||||
Net Assets | Expenses to | |||||||||||||||||||||||
Net | Net Asset | at End of | Average | |||||||||||||||||||||
realized | Total | Value, End | Total | Period | Net | |||||||||||||||||||
gains | Distributions | of Period | Return (a) | (000s) | Assets (b) | |||||||||||||||||||
Class I Shares | ||||||||||||||||||||||||
For the year ended December 31, 2002 | (0.10 | ) | (0.63 | ) | $ | 12.28 | 10.98% | $ | 1,982,676 | 0.73% | ||||||||||||||
For the year ended December 31, 2003 (g) | (0.02 | ) | (0.40 | ) | $ | 12.13 | 2.00% | $ | 1,488,089 | 0.73% | ||||||||||||||
For the year ended December 31, 2004 | (0.24 | ) | (0.90 | ) | $ | 11.62 | 3.26% | $ | 1,222,615 | 0.73% | ||||||||||||||
For the year ended December 31, 2005 | (0.02 | ) | (0.45 | ) | $ | 11.54 | 3.26% | $ | 1,117,512 | 0.73% | ||||||||||||||
For the year ended December 31, 2006 | (0.09 | ) | (0.56 | ) | $ | 11.35 | 3.34% | $ | 1,067,945 | 0.73% | ||||||||||||||
For the six months ended June 30, 2007 (Unaudited) | – | (0.25 | ) | $ | 11.24 | 1.27% | $ | 1,105,966 | 0.70% | |||||||||||||||
Class II Shares | ||||||||||||||||||||||||
Period ended December 31, 2002 (e) | (0.09 | ) | (0.35 | ) | $ | 12.26 | 6.16% | $ | 10,111 | 0.97% | ||||||||||||||
For the year ended December 31, 2003 (g) | (0.02 | ) | (0.38 | ) | $ | 12.10 | 1.77% | $ | 20,998 | 0.98% | ||||||||||||||
For the year ended December 31, 2004 | (0.24 | ) | (0.87 | ) | $ | 11.59 | 3.01% | $ | 17,643 | 0.98% | ||||||||||||||
For the year ended December 31, 2005 | (0.02 | ) | (0.42 | ) | $ | 11.51 | 3.01% | $ | 15,765 | 0.98% | ||||||||||||||
For the year ended December 31, 2006 | (0.09 | ) | (0.53 | ) | $ | 11.32 | 3.00% | $ | 14,470 | 0.98% | ||||||||||||||
For the six months ended June 30, 2007 (Unaudited) | – | (0.24 | ) | $ | 11.20 | 1.16% | $ | 14,069 | 0.95% |
[Additional columns below]
[Continued from above table, first column(s) repeated]
Ratios/Supplemental Data | ||||||||||||||||||
Ratio of Net | ||||||||||||||||||
Ratio of Net | Ratio of | Investment | ||||||||||||||||
Investment | Expenses | Income | ||||||||||||||||
Income | (Prior to | (Prior to | ||||||||||||||||
to Average | Reimbursements) | Reimbursements) | ||||||||||||||||
Net | to Average | to Average | Portfolio | |||||||||||||||
Assets (b) | Net Assets (b)(c) | Net Assets (b)(c) | Turnover (d) | |||||||||||||||
Class I Shares | ||||||||||||||||||
For the year ended December 31, 2002 | 4.53% | 0.73% | 4.53% | 49.00% | ||||||||||||||
For the year ended December 31, 2003 (g) | 4.12% | (h) | (h) | 40.46% | ||||||||||||||
For the year ended December 31, 2004 | 3.75% | (h) | (h) | 69.37% | ||||||||||||||
For the year ended December 31, 2005 | 3.65% | (h) | (h) | 87.79% | ||||||||||||||
For the year ended December 31, 2006 | 4.16% | (h) | (h) | 93.01% | ||||||||||||||
For the six months ended June 30, 2007 (Unaudited) | 4.58% | 0.70% | 4.58% | 49.96% | ||||||||||||||
Class II Shares | ||||||||||||||||||
Period ended December 31, 2002 (e) | 3.93% | (h) | (h) | 49.00% | ||||||||||||||
For the year ended December 31, 2003 (g) | 3.85% | (h) | (h) | 40.46% | ||||||||||||||
For the year ended December 31, 2004 | 3.50% | (h) | (h) | 69.37% | ||||||||||||||
For the year ended December 31, 2005 | 3.40% | (h) | (h) | 87.79% | ||||||||||||||
For the year ended December 31, 2006 | 3.91% | (h) | (h) | 93.01% | ||||||||||||||
For the six months ended June 30, 2007 (Unaudited) | 4.33% | 0.95% | 4.33% | 49.96% |
[Additional columns below]
[Continued from above table, first column(s) repeated]
(a) | Not annualized for periods less than one year. |
(b) | Annualized for periods less than one year. |
(c) | During the period, certain fees were waived and/or reimbursed. If such waivers/reimbursements had not occurred, the ratios would have been as indicated. |
(d) | Portfolio turnover is calculated on the basis of the Fund as a whole without distinguishing among the classes of shares. |
(e) | For the period from July 8, 2002 (commencement of operations) through December 31, 2002. |
(f) | For the period from May 20, 2002 (commencement of operations) through December 31, 2002. |
(g) | Net investment income (loss) is based on average shares outstanding during the period. |
(h) | There were no fee reductions during the period. |
(i) | For the period from April 28, 2003 (commencement of operations) through December 31, 2003. |
Distributions | ||||||||||||||||||||
Investment Activities | ||||||||||||||||||||
Net Realized | ||||||||||||||||||||
and | ||||||||||||||||||||
Net Asset | Unrealized | Total | ||||||||||||||||||
Value, | Net | Gains | from | Net | ||||||||||||||||
Beginning | Investment | (Losses) on | Investment | Investment | ||||||||||||||||
of Period | Income | Investments | Activities | Income | ||||||||||||||||
Class III Shares | ||||||||||||||||||||
Period ended December 31, 2002 (f) | $ | 11.75 | 0.36 | 0.67 | 1.03 | (0.41 | ) | |||||||||||||
For the year ended December 31, 2003 (g) | $ | 12.27 | 0.50 | (0.24 | ) | 0.26 | (0.37 | ) | ||||||||||||
For the year ended December 31, 2004 (g) | $ | 12.14 | 0.46 | (0.07 | ) | 0.39 | (0.66 | ) | ||||||||||||
For the year ended December 31, 2005 | $ | 11.63 | 0.40 | (0.04 | ) | 0.36 | (0.43 | ) | ||||||||||||
For the year ended December 31, 2006 | $ | 11.54 | 0.47 | (0.10 | ) | 0.37 | (0.47 | ) | ||||||||||||
For the six months ended June 30, 2007 (Unaudited) | $ | 11.35 | 0.23 | (0.09 | ) | 0.14 | (0.25 | ) | ||||||||||||
Class IV Shares | ||||||||||||||||||||
Period ended December 31, 2003 (i) | $ | 12.29 | 0.34 | (0.24 | ) | 0.10 | (0.26 | ) | ||||||||||||
For the year ended December 31, 2004 | $ | 12.13 | 0.46 | (0.07 | ) | 0.39 | (0.66 | ) | ||||||||||||
For the year ended December 31, 2005 | $ | 11.62 | 0.43 | (0.07 | ) | 0.36 | (0.43 | ) | ||||||||||||
For the year ended December 31, 2006 | $ | 11.53 | 0.48 | (0.10 | ) | 0.38 | (0.47 | ) | ||||||||||||
For the six months ended June 30, 2007 (Unaudited) | $ | 11.35 | 0.26 | (0.13 | ) | 0.13 | (0.25 | ) | ||||||||||||
[Additional columns below]
[Continued from above table, first column(s) repeated]
Distributions | ||||||||||||||||||||||||
Ratio of | ||||||||||||||||||||||||
Net Assets | Expenses to | |||||||||||||||||||||||
Net | Net Asset | at End of | Average | |||||||||||||||||||||
realized | Total | Value, End | Total | Period | Net | |||||||||||||||||||
gains | Distributions | of Period | Return (a) | (000s) | Assets (b) | |||||||||||||||||||
Class III Shares | ||||||||||||||||||||||||
Period ended December 31, 2002 (f) | (0.10 | ) | (0.51 | ) | $ | 12.27 | 8.84% | $ | 7,625 | 0.73% | ||||||||||||||
For the year ended December 31, 2003 (g) | (0.02 | ) | (0.39 | ) | $ | 12.14 | 2.11% | $ | 4,369 | 0.73% | ||||||||||||||
For the year ended December 31, 2004 (g) | (0.24 | ) | (0.90 | ) | $ | 11.63 | 3.27% | $ | 6,854 | 0.73% | ||||||||||||||
For the year ended December 31, 2005 | (0.02 | ) | (0.45 | ) | $ | 11.54 | 3.18% | $ | 10,604 | 0.73% | ||||||||||||||
For the year ended December 31, 2006 | (0.09 | ) | (0.56 | ) | $ | 11.35 | 3.35% | $ | 13,164 | 0.72% | ||||||||||||||
For the six months ended June 30, 2007 (Unaudited) | – | (0.25 | ) | $ | 11.24 | 1.28% | $ | 16,840 | 0.71% | |||||||||||||||
Class IV Shares | ||||||||||||||||||||||||
Period ended December 31, 2003 (i) | – | (0.26 | ) | $ | 12.13 | 0.84% | $ | 43,244 | 0.70% | |||||||||||||||
For the year ended December 31, 2004 | (0.24 | ) | (0.90 | ) | $ | 11.62 | 3.27% | $ | 41,019 | 0.73% | ||||||||||||||
For the year ended December 31, 2005 | (0.02 | ) | (0.45 | ) | $ | 11.53 | 3.17% | $ | 39,264 | 0.73% | ||||||||||||||
For the year ended December 31, 2006 | (0.09 | ) | (0.56 | ) | $ | 11.35 | 3.34% | $ | 35,962 | 0.73% | ||||||||||||||
For the six months ended June 30, 2007 (Unaudited) | – | (0.25 | ) | $ | 11.23 | 1.27% | $ | 35,205 | 0.70% | |||||||||||||||
[Additional columns below]
[Continued from above table, first column(s) repeated]
Ratios/Supplemental Data | ||||||||||||||||||
Ratio of Net | ||||||||||||||||||
Ratio of Net | Ratio of | Investment | ||||||||||||||||
Investment | Expenses | Income | ||||||||||||||||
Income | (Prior to | (Prior to | ||||||||||||||||
to Average | Reimbursements) | Reimbursements) | ||||||||||||||||
Net | to Average | to Average | Portfolio | |||||||||||||||
Assets (b) | Net Assets (b)(c) | Net Assets (b)(c) | Turnover (d) | |||||||||||||||
Class III Shares | ||||||||||||||||||
Period ended December 31, 2002 (f) | 4.12% | (h) | (h) | 49.00% | ||||||||||||||
For the year ended December 31, 2003 (g) | 4.10% | (h) | (h) | 40.46% | ||||||||||||||
For the year ended December 31, 2004 (g) | 3.72% | (h) | (h) | 69.37% | ||||||||||||||
For the year ended December 31, 2005 | 3.66% | (h) | (h) | 87.79% | ||||||||||||||
For the year ended December 31, 2006 | 4.21% | (h) | (h) | 93.01% | ||||||||||||||
For the six months ended June 30, 2007 (Unaudited) | 4.58% | 0.71% | 4.58% | 49.96% | ||||||||||||||
Class IV Shares | ||||||||||||||||||
Period ended December 31, 2003 (i) | 4.07% | (h) | (h) | 40.46% | ||||||||||||||
For the year ended December 31, 2004 | 3.74% | (h) | (h) | 69.37% | ||||||||||||||
For the year ended December 31, 2005 | 3.65% | (h) | (h) | 87.79% | ||||||||||||||
For the year ended December 31, 2006 | 4.16% | (h) | (h) | 93.01% | ||||||||||||||
For the six months ended June 30, 2007 (Unaudited) | 4.58% | 0.70% | 4.58% | 49.96% | ||||||||||||||
(a) | Not annualized for periods less than one year. | |
(b) | Annualized for periods less than one year. | |
(c) | During the period, certain fees were waived and/or reimbursed. If such waivers/reimbursements had not occurred, the ratios would have been as indicated. | |
(d) | Portfolio turnover is calculated on the basis of the Fund as a whole without distinguishing among the classes of shares. | |
(e) | For the period from July 8, 2002 (commencement of operations) through December 31, 2002. | |
(f) | For the period from May 20, 2002 (commencement of operations) through December 31, 2002. | |
(g) | Net investment income (loss) is based on average shares outstanding during the period. | |
(h) | There were no fee reductions during the period. | |
(i) | For the period from April 28, 2003 (commencement of operations) through December 31, 2003. |
See accompanying notes to financial statements.
1. Organization
Nationwide Variable Insurance Trust (“NVIT” or the “Trust”) is an open-end management investment company, organized under the laws of Delaware by an amended and restated Agreement and Declaration of Trust, dated October 28, 2004, as amended to date. Prior to May 1, 2007, the Trust was named “Gartmore Variable Insurance Trust”. The Trust, originally created under the laws of Massachusetts as a Massachusetts business trust pursuant to a Declaration of Trust dated, as of June 30, 1981, and as subsequently amended, redomesticated as a Delaware Statutory Trust after the close of trading on April 29, 2005, and is registered under the Investment Company Act of 1940, as amended (the “1940 Act”). The redomestication was a change in statutory status and did not affect the operations of the Trust. As of June 30, 2007, the Trust had authorized an unlimited number of shares of beneficial interest, without par value (“shares”). The Trust currently offers shares to life insurance company separate accounts to fund the benefits under variable life insurance or annuity policies. To date, only the separate accounts of Nationwide Life Insurance Company and Nationwide Life and Annuity Insurance Company (collectively, “Nationwide”) have purchased shares of the Nationwide NVIT Government Bond Fund (the “Fund”), (formerly, “Gartmore GVIT Government Bond Fund”). The Trust currently operates forty (40) separate series, or mutual funds, each with its own investment objectives and strategies. This report contains the financial statements and financial highlights of the Fund.
2. Summary of Significant Accounting Policies
The following is a summary of significant accounting policies followed by the Fund in the preparation of its financial statements. The policies are in conformity with accounting principles generally accepted in the United States of America (“GAAP”). The preparation of financial statements requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of income and expenses for the period. Actual results could differ from those estimates.
(a) | Security Valuation |
Securities for which market quotations are readily available are valued at current market value as of “Valuation Time.” Valuation Time is as of the close of regular trading on the New York Stock Exchange (usually 4 p.m. Eastern time). Equity securities are valued at the last quoted sale price or, if there is no sale price, the last quoted bid price provided by an independent pricing service approved by the Trust’s Board of Trustees (“Board of Trustees”). Securities traded on NASDAQ are valued at the NASDAQ official closing price. Prices are taken from the primary market or exchange in which each security trades. | |
Most securities listed on a foreign exchange are valued either at fair value (see description below) or at the last sale price at the close of the exchange on which the security is principally traded. Foreign securities, currencies, and other assets and liabilities denominated in foreign currencies are translated into U.S. dollars at the exchange rate of said currencies against the U.S. dollar, as of Valuation Time, as provided by an independent pricing service approved by the Board of Trustees. | |
Debt (including defaulted issues) and other fixed income securities (other than short-term obligations) are valued at the last quoted bid price and/or by using a combination of daily quotes and matrix evaluations provided by an independent pricing service, the use of which has been approved by the Board of Trustees. Short-term debt securities, such as commercial paper and U.S. Treasury Bills having a remaining maturity of 60 days or less at the time of purchase, are considered to be “short-term” and are valued at amortized cost, which approximates market value. | |
Securities for which market quotations are not readily available, or for which an independent pricing service does not provide a value or provides a value that does not represent fair value in the judgment of the Fund’s investment adviser or designee, are valued at fair value under procedures approved by the Board of Trustees. The “Fair Value” of these securities is determined in good faith by taking into account relevant factors and surrounding circumstances. Methods utilized to obtain a “Fair Value” may include the following non-exclusive list of acceptable methods: (i) a multiple of earnings; (ii) the discount from market value of a similar, freely traded security; (iii) the yield-to-maturity |
for debt issues; or (iv) a consolidation of the methods. The Trust’s Valuation & Operations Committee considers a non-exclusive list of factors to arrive at the appropriate method of determining “Fair Value.” For example, fair value determinations are required for securities whose value is affected by a “significant” event that materially affects the value of a domestic or foreign security which occurs subsequent to the time of the close of the principal market on which such domestic or foreign security trades and before the Valuation Time (i.e., a “subsequent event”). Typically, this will involve events occurring after the close of a foreign market on which a security trades and before the next Valuation Time. | |
The Fund values foreign securities at fair value in the circumstances described below. Generally, trading in foreign securities markets is completed each day at various times prior to the Valuation Time. Due to the time differences between the closings of the relevant foreign securities exchanges and the Valuation Time for the Fund, the Fund will fair value its foreign investments when it is determined that the market quotations for the foreign investments either are not readily available or are unreliable and, therefore, do not represent fair value. When the fair value prices are utilized, these prices will attempt to reflect the impact of the U.S. financial markets’ perceptions and trading activities on the Fund’s foreign investments since the last closing prices of the foreign investments were calculated on their primary foreign securities markets or exchanges. For these purposes, the Board of Trustees has determined that movements in relevant indices or other appropriate market indicators, after the close of the foreign securities exchanges, may demonstrate that market quotations are unreliable, and may trigger fair value pricing for certain securities. Consequently, fair valuation of portfolio securities may occur on a daily basis. |
(b) | Repurchase Agreements |
The Fund may enter into repurchase agreements with an entity which is a member of the Federal Reserve System or which is a “primary dealer” (as designated by the Federal Reserve Bank of New York) in U.S. Government obligations. The repurchase price generally equals the price paid by the Fund plus interest negotiated on the basis of current short-term rates, which may be more or less than the rate on the underlying portfolio securities. The seller under a repurchase agreement is required to maintain the value of the collateral held pursuant to the agreement at a market value equal to or greater than the repurchase price (including accrued interest). Collateral subject to repurchase agreements is held by the Fund’s custodian or another qualified sub-custodian or in the Federal Reserve/ Treasury book-entry system. If the counterparty defaults and the fair value of the collateral declines, realization of the collateral by the Fund may be delayed or limited. The Fund may transfer uninvested cash balances into a pooled cash account. These balances are invested in one or more repurchase agreements, with the counterparty of Nomura Securities, which is fully collateralized by U.S. Government Agency Mortgages. |
(c) | Mortgage Dollar Rolls |
The Fund may enter into mortgage “dollar rolls” in which the Fund sells mortgage-backed securities for delivery in the current month and simultaneously contracts to repurchase substantially similar (same type, coupon, and maturity) securities on a specified future date. Mortgage dollar rolls may be implemented in the “to be announced” (“TBA”) market and are referred to as TBAs on the Statement of Investments of the Fund. During the roll period, the Fund foregoes principal and interest paid on the mortgage-backed securities. Each mortgage dollar roll is treated as a financing transaction; therefore, any gain or loss is considered unrealized until the roll reaches completion. Risks may arise due to the delayed payment date and the potential inability of counterparties to complete the transaction. Income is generated as consideration for entering into these transactions and is included in interest income on the Statement of Operations. |
(d) | Security Transactions and Investment Income |
Security transactions are accounted for on the date the security is purchased or sold (“trade date”). Securities gains and losses are calculated on the identified cost basis. Interest income is recognized on the accrual basis and includes, where applicable, the amortization or accretion of premium or discount. |
(e) | Securities Lending |
To generate additional income, the Fund may lend its portfolio securities, up to 33 1/3% of the Fund, to brokers, dealers and other financial institutions provided that (1) the borrower delivers cash or securities as collateral with respect to each new loan of U.S. securities, equal to at least 102% of the value of the portfolio securities loaned, and with respect to each new loan on non-U.S. securities, collateral of at least 105% of the value of the portfolio securities loaned; and (2) at all times thereafter shall require the borrower to mark-to-market the collateral on a daily basis so that the market value of such collateral does not fall below 100% of the value of securities loaned. The Fund receives payments from borrowers equivalent to the dividends and interest that would have been earned on securities loaned while simultaneously seeking to earn income on the investment of cash collateral. There may be risks of delay in recovery of the securities should the borrower of the securities fail financially. Loans will be made, however, only to borrowers deemed by the Fund’s investment adviser to be of good standing and creditworthy under guidelines established by the Board of Trustees and when, in judgment of the adviser, the consideration which can be earned currently from these securities loans justifies the attendant risks. Loans are subject to termination by the Fund or the borrower at any time, and, therefore, are not considered to be illiquid investments. JPMorgan Chase Bank serves as custodian for the securities lending program of the Fund. JPMorgan Chase Bank receives a fee based on the value of the collateral received from borrowers. | |
Information on the investment of cash collateral is shown in the Statement of Investments. | |
As of June 30, 2007, the Fund had securities with the following value on loan: |
Value of | ||||||
Value of Loaned Securities | Collateral | |||||
$125,500,511 | $ | 127,539,652* | ||||
* | Includes $77,327,103 in the form of U.S. Government Securities, interest rates ranging from 0.00% to 9.50% and maturity dates range from 07/02/07 to 01/25/48. |
(f) | Distributions to Shareholders |
The Fund’s dividends from net investment income, if any, are declared daily and paid monthly. The Fund’s distributions from net realized capital gains, if any, are declared and distributed at least annually. | |
Dividends and distributions to shareholders are determined in accordance with federal income tax regulations, which may differ from GAAP. These “book/tax” differences are considered either permanent or temporary in nature. In accordance with the American Institute of Certified Public Accountants Statement of Position 93-2, permanent differences (i.e., reclassification of market discounts, foreign exchange gain/loss, paydowns, and distributions from real estate investment trusts) are reclassified within the capital accounts based on their nature for federal income tax purposes; temporary differences do not require reclassification. These reclassifications have no effect upon the net asset value of the Fund. To the extent distributions exceed current and accumulated earnings and profits for federal income tax purposes, these distributions are reported as distributions of paid-in-capital. |
(g) | Federal Income Taxes |
It is the policy of the Fund to qualify or to continue to qualify as a “regulated investment company” by complying with the provisions available to certain investment companies, as defined in Subchapter M of the U.S. Internal Revenue Code, and to make distributions of net investment income and net realized capital gains sufficient to relieve the Fund from all, or substantially all, federal income taxes. |
As of June 30, 2007, the tax cost of securities and the breakdown of unrealized appreciation (depreciation) for the Fund was as follows: |
Net Unrealized | ||||||||||||||||
Tax Cost of | Unrealized | Unrealized | Appreciation | |||||||||||||
Securities | Appreciation | Depreciation | (Depreciation) | |||||||||||||
$ | 1,218,425,195 | $ | 2,534,812 | $ | (9,801,271 | ) | $ | (7,266,459 | ) | |||||||
(h) | Allocation of Expenses, Income, and Gains and Losses |
Expenses directly attributable to the Fund are charged to the Fund. Expenses not directly attributable to the Fund are allocated proportionately among various or all funds within the Trust. The method used by the Fund for allocating income, fund level expenses, and realized and unrealized gains or losses is based on the fair value of shares outstanding relative to net assets. Under this method, each class of shares participates based on the total net asset value of that class’s shares in proportion to the total net assets of the Fund. Expenses specific to a class (such as Rule 12b-1 and administrative services fees) are charged to that class. |
3. Transactions with Affiliates
Under the terms of the Trust’s Investment Advisory Agreement, Nationwide Fund Advisors (formerly, Gartmore Mutual Fund Capital Trust (“GMF”)) (“NFA” or the “Advisor”) manages the investment of the assets and supervises the daily business affairs of the Fund. NFA is a wholly-owned subsidiary of Nationwide Financial Services (“NFS”).
Under the terms of the Investment Advisory Agreement, the Fund pays NFA an investment advisory fee based on the Fund’s average daily net assets and the following fee schedule:
Fee Schedule | Fees | |||||
Up to $250 million | 0.500% | |||||
Next $750 million | 0.475% | |||||
Next $1 billion | 0.450% | |||||
Next $3 billion | 0.425% | |||||
$5 billion or more | 0.400% | |||||
Under the terms of a Fund Administration and Transfer Agency Agreement, Nationwide Fund Management, LLC ((formerly, Gartmore Investor Services, Inc. (“GISI”))(“NFM”), a wholly-owned subsidiary of NFS Distributors, Inc. (“NFSDI”), provides the Fund with various administrative and accounting services for the Fund (prior to May 1, 2007, this service was provided by Gartmore SA Capital Trust (“GSA”)), and serves as Transfer and Dividend Disbursing Agent for the Fund (prior to May 1, 2007, this service was provided by GISI, an indirect subsidiary of GSA). The fees for the services provided under this Agreement are calculated based on the Trust’s average daily net assets according to the fee schedule below. The fees are then allocated proportionately among all funds within the Trust in relation to the average daily net assets of each fund and are paid to NFA. NFA pays NFM from these fees for NFM’s services.
Combined Fee Schedule* | ||||||
Up to $1 billion | 0.15% | |||||
$1 billion up to $3 billion | 0.10% | |||||
$3 billion up to $8 billion | 0.05% | |||||
$8 billion up to $10 billion | 0.04% | |||||
$10 billion up to $12 billion | 0.02% | |||||
$12 billion or more | 0.01% | |||||
* | The assets of the Nationwide NVIT Investor Destinations Aggressive Fund, the Nationwide NVIT Investor Destinations Moderately Aggressive Fund, the Nationwide NVIT Investor Destinations Moderate Fund, the Nationwide NVIT Investor Destinations Moderately Conservative Fund, and the Nationwide NVIT Investor Destinations Conservative Fund (collectively, the “Investor Destinations Funds”) are excluded from the Trust asset level amount in order to calculate this asset-based fee. The Investor Destinations Funds do not pay any part of this fee. |
NFA and NFM have entered into agreements with Citi Fund Services Ohio, Inc. (“Citi”), pursuant to which Citi provides sub-administration and sub-transfer agency services, respectively, to the Fund. Effective August 1, 2007, The BISYS Group Inc. was acquired by and became a wholly owned subsidiary of Citi.
Under the terms of a Distribution Plan under Rule 12b-1 of the 1940 Act, Nationwide Fund Distributors, LLC. (formerly, “Gartmore Distribution Services, Inc.”) (“NFD” or “Distributor”), the Fund’s principal underwriter, is compensated by the Fund for expenses associated with the distribution of the Class II shares of the Fund. NFD is a majority-owned subsidiary of NFSDI. These fees are based on average daily net assets of Class II shares of the Fund at an annual rate not to exceed 0.25%.
Under the terms of an Administrative Services Plan, the Fund may pay fees to servicing organizations, such as broker-dealers, including NFS, and financial institutions, which agree to provide administrative support services to the shareholders of certain classes. These services include, but are not limited, to the following: establishing and maintaining shareholder accounts; processing purchase and redemption transactions; arranging bank wires; performing shareholder sub-accounting; answering inquires regarding the Fund; and other such services. These fees are based on an annual rate of up to 0.25% of the average daily net assets of Class I, Class II, and Class III shares of the Fund and 0.20% of Class IV shares of the Fund.
For the six months ended June 30, 2007, NFS received $861,002 in Administrative Services Fees from the Fund.
Under the terms of a letter agreement dated September 12, 2006, by and among NFA, the Audit Committee of the Trust and the Trust, the Trust has agreed to reimburse NFA certain costs related to the Fund’s portion of ongoing administration, monitoring and annual (audit) testing of the Trust’s Rule 38a-1 Compliance Program subject to the pre-approval of the Trust’s Audit Committee. For the six months ended June 30, 2007, the Fund’s portion of such costs amounted to $7,829.
4. Short-Term Trading Fees
The Fund reserves the right to assess a short-term trading fee on certain transactions out of Class III shares that a separate account makes on behalf of a variable insurance contract owner (the “contract owner”). A separate account that redeems Class III shares on behalf of a contract owner may be subject to a 1.00% short-term trading fee if the separate account held the Class III shares on behalf of the contract owner for 60 days or less, unless an exception applies as disclosed in the Fund’s prospectus. The short-term trading fee is paid directly to the Fund and is intended to offset the cost to the Fund of excess brokerage commissions and other costs associated with fluctuations in Fund asset levels and cash flow caused by short-term trading. For purposes of determining whether the short-term trading fee applies, the Class III shares that were held on behalf of the contract owner the longest will be treated as being redeemed first.
For the six months ended June 30, 2007, the Fund had contributions to capital due to collection of redemption fees in the amount of $2,329.
5. Investment Transactions
For the six months ended June 30, 2007, (excluding short-term securities) the Fund had purchases of $820,528,314 and sales of $511,732,399.
For the six months ended June 30, 2007, the Fund had purchases of $677,287,654 and sales of $282,777,999 of U.S. Government securities.
6. Bank Loans and Earnings Credit
The Trust has a credit agreement with JPMorgan Chase & Co., the Fund’s custodian bank, permitting the Trust to borrow up to $100,000,000. Borrowings under this arrangement bear interest at the Federal Funds rate plus 0.50%. The interest costs, if any, would be included in other fees in the Statement of Operations. No compensating balances were required under the terms of the line of credit. The line of credit is renewed annually, expiring on June 25, 2008, with a commitment fee of 0.07% per year on $100,000,000. There were no borrowings outstanding under this line of credit for the six months ended June 30, 2007.
The Trust’s custodian bank has agreed to reduce the bank’s fees (earnings credit) when the funds of the Trust maintain cash on deposit in non-interest-bearing custody and Demand Deposit Accounts. Earnings credits, if any, are shown as a reduction of total expenses on the Statement of Operations.
7. Portfolio Investment Risks
Risks Associated with Foreign Securities and Currencies. Investments in securities of foreign issuers carry certain risks not ordinarily associated with investments in securities of U.S. issuers. These risks include future political and economic developments, and the possible imposition of exchange controls or other foreign governmental laws and restrictions. In addition, with respect to certain countries, there is the possibility of expropriation of assets, confiscatory taxation, political or social instability, or diplomatic developments, which could adversely affect investments in those countries.
Certain countries also may impose substantial restrictions on investments in their capital markets by foreign entities, including restrictions on investments in issuers of industries deemed sensitive to relevant national interests. These factors may limit the investment opportunities available and result in a lack of liquidity and high price volatility with respect to securities of issuers from developing countries.
8. Indemnifications
Under the Trust’s organizational documents, certain of the Trust’s Officers and Trustees are indemnified against certain liabilities arising out of the performance of their duties to the Trust. In addition, the Trust has entered into Indemnification Agreements with the Trust’s trustees and certain officers covering similar liabilities. Trust Officers receive no compensation from the Trust for serving as the Trust’s Officers. In addition, in the normal course of business, the Trust enters into contracts with its vendors and others that provide for general indemnifications. The Trust’s maximum exposure under these arrangements is unknown, as this would involve future claims that may be made against the Trust. Based on experience, however, the Trust expects that risk of loss to be remote.
9. Recently Issued Accounting Pronouncements
On July 13, 2006, the Financial Accounting Standards Board (“FASB”) released FASB Interpretation No. 48, Accounting for Uncertainty in Income Taxes (“FIN 48”). FIN 48 provides guidance for how uncertain tax positions should be recognized, measured, presented and disclosed in the financial statements. FIN 48 requires the affirmative evaluation of tax positions taken or expected to be taken in the course of preparing the Fund’s tax returns to determine whether it is more-likely-than-not (i.e., greater than 50 percent) that each tax position will be sustained upon examination by a taxing authority based on the technical merits of the position. A tax position that meets the more-likely-than-not recognition threshold is measured to determine the amount of benefit to recognize in the financial statements. Differences between tax positions taken in a tax return and amounts recognized in the financial statements will generally result in an increase in a liability for taxes payable (or a reduction of a tax refund receivable) and an increase in a deferred tax liability (or a reduction in a deferred tax asset). Adoption of FIN 48 was required no later than the last business day of the first financial statement reporting period for fiscal years beginning after December 15, 2006 and is to be applied to all open tax years as of the effective date. Accordingly, the Fund was required to implement FIN 48 in its net asset value per share (NAV) calculation on June 29, 2007. Management has evaluated the implications of FIN 48 and has concluded that there was no impact to the Fund’s financial statements as of June 29, 2007. The adoption of FIN 48 requires ongoing
In September 2006, the FASB issued Statement on Financial Accounting Standards (“SFAS”) No. 157, “Fair Value Measurements.” This standard establishes a single authoritative definition of fair value, sets out a framework for measuring fair value and requires additional disclosures about fair value measurements. SFAS No. 157 applies to fair value measurements already required or permitted by existing standards. SFAS No. 157 is effective for financial statements issued for fiscal years beginning after November 15, 2007 and interim periods within those fiscal years. The changes to current accounting principles generally accepted in the United States of America from the application of this Statement relate to the definition of fair value, the methods used to measure fair value, and the expanded disclosures about fair value measurements. As of June 30, 2007, the Fund does not believe the adoption of SFAS No. 157 will impact the financial statement amounts; however, additional disclosures may be required about the inputs used to develop the measurements and the effect of certain of the measurements on changes in net assets for the period.
Trustees who are not Interested Persons (as defined in the 1940 Act) and Officers of the Trust as of
Number of Portfolios | ||||||||||
Position(s) Held | in the | |||||||||
with the Trust | Principal Occupation(s) | Nationwide Fund | Other | |||||||
Name, Address | and Length of | During Past | Complex Overseen | Directorships | ||||||
and Year of Birth | Time Served1 | Five Years | by Trustee | Held by Trustee2 | ||||||
Charles E. Allen c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1948 | Trustee since July 2000 | Mr. Allen is Chairman, Chief Executive Officer and President of Graimark Realty Advisors, Inc. (real estate development, investment and asset management). | 89 | None | ||||||
Paula H.J. Cholmondeley c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1947 | Trustee since July 2000 | Ms. Cholmondeley was Vice President and General Manager of Sappi Fine Paper North America from April 2000 through December 2003. | 89 | Director of Dentsply International, Inc. (dental products), Ultralife Batteries, Inc., Terex Corporation (construction equipment), Minerals Technology, Inc. (specialty chemicals) and Albany International Corp. (paper industry) | ||||||
C. Brent DeVore3 c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1940 | Trustee since 1990 | Dr. DeVore is President of Otterbein College. | 89 | None | ||||||
Phyllis Kay Dryden c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1947 | Trustee since December 2004 | Ms. Dryden was a partner of Mitchell Madison, a management consulting company from January 2006 until December 2006; she is currently a consultant with the company. Ms. Dryden was formerly Managing Partner of march FIRST, a global management consulting firm. | 89 | None | ||||||
Barbara L. Hennigar c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1935 | Trustee since July 2000 | Retired. | 89 | None | ||||||
Number of Portfolios | ||||||||||
Position(s) Held | in the | |||||||||
with the Trust | Principal Occupation(s) | Nationwide Fund | Other | |||||||
Name, Address | and Length of | During Past | Complex Overseen | Directorships | ||||||
and Year of Birth | Time Served1 | Five Years | by Trustee | Held by Trustee2 | ||||||
Barbara I. Jacobs c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1950 | Trustee since December 2004 | Ms. Jacobs served as Chairman of the Board of Directors of KICAP Network Fund, a European (United Kingdom) hedge fund, from January 2001 through January 2006. From 1998-2003, Ms. Jacobs was also a Managing Director and European Portfolio Manager of CREF Investments (Teachers Insurance and Annuity Association-College Retirement Equities Fund). | 89 | None | ||||||
Douglas F. Kridler c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1955 | Trustee since September 1997 | Mr. Kridler has served as the President and Chief Executive Officer of the Columbus Foundation (a Columbus, OH-based foundation which manages over 1,300 individual endowment funds) since February 2002. Prior to January 31, 2002, Mr. Kridler was the President of the Columbus Association for the Performing Arts and Chairman of the Greater Columbus Convention and Visitors Bureau. | 89 | None | ||||||
Michael D. McCarthy c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1947 | Trustee since December 2004 | Retired. Mr. McCarthy was Chairman of VMAC (commodity swaps) from October 2002 until January 2007; and a partner of Pineville Properties LLC (a commercial real estate development firm) from September 2000 until January 2007. | 89 | None | ||||||
David C. Wetmore c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1948 | Trustee since 1995 and Chairman since February 2005 | Retired. | 89 | None | ||||||
1 | Length of time served includes time served with the Trust’s predecessors. | |
2 | Directorships held in (1) any other investment companies registered under the 1940 Act, (2) any company with a class of securities registered pursuant to Section 12 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or (3) any company subject to the requirements of Section 15(d) of the Exchange Act. | |
3 | Mr. DeVore has served as President of Otterbein College since 1984. Mark Thresher, President and Chief Operating Officer of Nationwide Financial Services, Inc. (“NFS”) has served as a member of the Board of Trustees of Otterbein College since 2000, currently serves as one of 30 of its trustees, and is currently one of two Vice Chairmen of the Board. Each of Nationwide Fund Advisors (“NFA”), the Funds’ investment adviser, and Nationwide Fund Distributors LLC (“NFD”), principal underwriter to the Trust, is a wholly-owned subsidiary of NFS. | |
Additional information regarding the Trustees and Officers may be found in the Trust’s Statement of Additional Information, which is available without charge upon request, by calling 800-848-0920. |
Trustees who are Interested Persons (as defined in the 1940 Act) and/or Officers of the Trust as of
Number of Portfolios | ||||||||||
Position(s) Held | in the | |||||||||
with the Trust | Principal Occupation(s) | Nationwide Fund | Other | |||||||
Name, Address | and Length of | During Past | Complex Overseen | Directorships | ||||||
and Year of Birth | Time Served1 | 5 Years | by Trustee | Held by Trustee 2 | ||||||
Arden L. Shisler c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1941 | Trustee since February 2000 | Retired. Mr. Shisler is the former President and Chief Executive Officer of KeB Transport, Inc., a trucking firm (2000 through 2002). He served as a consultant to KeB from January 2003 through December 2004. Since 1992, Mr. Shisler has also been Chairman of the Board for Nationwide Mutual Insurance Company.3 | 89 | Director of Nationwide Financial Services, Inc., Chairman of Nationwide Mutual Insurance Company3 | ||||||
John H. Grady Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1961 | President & Chief Executive Officer since December 2006 | Mr. Grady is President, and Chief Executive Officer of Nationwide Funds Group which includes Nationwide Fund Advisors,3 Nationwide Fund Management LLC,3 Nationwide Fund Distributors LLC 3 and NWD Investments,2 the asset management operations of Nationwide Mutual Insurance Company, which includes Morley Capital Management, Inc.,2 Nationwide Separate Accounts LLC,2 NorthPointe Capital LLC,2 and Nationwide SA Capital Trust2. From March 2004 until March 2006, Mr. Grady was Chief Executive Officer of Constellation Investment Management Co., L.P. (registered investment adviser), and President and Chief Executive Officer of Constellation Funds Group (registered investment companies). He also was President of Constellation Investment Distribution Co., Inc. (registered broker-dealer) from March 2004 until June 2006. From February 2001 until February 2004, Mr. Grady was Chief Operating and Chief Legal Officer; Managing Director, Mutual Funds Group, Turner Investment Partners, Inc. (registered investment adviser); Executive Vice President of Turner Funds and Turner Institutional Portfolios (registered investment companies); and President, Turner Investment Distributors, Inc. (registered broker-dealer). | N/A | None | ||||||
Gerald J. Holland Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1951 | Treasurer since March 2001 | Mr. Holland is Senior Vice President—Operations for Nationwide Funds Group3. | N/A | N/A | ||||||
Number of Portfolios | ||||||||||
Position(s) Held | in the | |||||||||
with the Trust | Principal Occupation(s) | Nationwide Fund | Other | |||||||
Name, Address | and Length of | During Past | Complex Overseen | Directorships | ||||||
and Year of Birth | Time Served1 | 5 Years | by Trustee | Held by Trustee 2 | ||||||
Michael A. Krulikowski Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1959 | Chief Compliance Officer from June 2004 to August 20074 | Mr. Krulikowski is Vice President and Chief Compliance Officer of Nationwide Funds Group3, Morley Capital Management, Inc.3, Nationwide SA Capital Trust (since 1999)3, and Nationwide Separate Accounts LLC (since August 2005).3 Since June 2004, Mr. Krulikowski has also served as Chief Compliance Officer of the Trust. From November 1999 through May 2007, he served as Vice President and Chief Compliance Officer of NorthPointe Capital LLC. 3 | N/A | N/A | ||||||
Eric E. Miller Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1953 | Secretary since December 2002 | Mr. Miller is Senior Vice President, General Counsel, and Assistant Secretary for Nationwide Funds Group3 and NWD Investments.2 From August 2000 to August 2002, Mr. Miller was a Partner with Stradley Ronon Stevens & Young, LLP. | N/A | N/A | ||||||
1 | Length of time served includes time served with the Trust’s predecessors. | |
2 | Directorships held in (1) any other investment companies registered under the 1940 Act, (2) any company with a class of securities registered pursuant to Section 12 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or (3) any company subject to the requirements of Section 15(d) of the Exchange Act. | |
3 | This position is held with an affiliated person or principal underwriter of the Trust. | |
4 | Effective August 3, 2007, the Board of Trustees approved Carol Baldwin Moody as Chief Compliance Officer of the Trust. Since November 2005, Ms. Moody has been Senior Vice President, Chief Compliance Officer of Nationwide Financial Services, Nationwide Life Insurance Company, Nationwide Life and Annuity Insurance Company, and Nationwide Investment Advisors, LLC. From February 2004-November 2005, she was Chief Compliance Officer of TIAA-CREF and from April 2000-February 2004, she was Managing Director and General Counsel, TCW/ Latin America Partners, LLC and Baeza & Co., LLC. | |
Federal law requires the Trust, each of its investment advisers and sub-advisers to adopt procedures for voting proxies (“Proxy Voting Guidelines”) and to provide a summary of those Proxy Voting Guidelines used to vote the securities held by the Funds. The Funds’ proxy voting policies and procedures are available without charge (i) upon request, by calling 800-848-0920, (ii) on the Funds’ website at www.nationwidefunds.com, or (iii) on the Securities and Exchange Commission’s website at www.sec.gov. |
A. Renewal of Investment Advisory Agreement
(i) General Information Regarding the Board’s Review of Investment Advisory Agreements
The Trust’s investment advisory agreements (each an “Advisory Agreement”) with its investment adviser and, as applicable, sub-advisers (together, the “Adviser”) must be approved for an initial term no greater than two years, and renewed at least annually thereafter, (i) by the vote of the Trustees or by a vote of the shareholders of each series or fund of the Trust (individually a “Fund” ), and (ii) by the vote of a majority of the Trustees who are not parties to the Advisory Agreement or “interested persons” of any party thereto (the “Independent Trustees”) cast in person at a meeting called for the purpose of voting on such approval.
The Board meets quarterly and takes into account throughout the year matters bearing on each Fund’s Advisory Agreement. The Board and its standing committees consider at each meeting factors that are relevant to the annual renewal of an Advisory Agreement, including the services and support provided to a Fund and its shareholders.
On December 6, 2006, the Independent Trustees first met in person with their independent legal counsel (“Independent Legal Counsel”) to consider information provided by the Adviser and others to assist the Trustees in considering whether to renew each Fund’s Advisory Agreement for a one year term beginning May 1, 2007. Immediately following such meeting of the Independent Trustees, all Trustees met in person with the Adviser, Trust counsel, Independent Legal Counsel and others to consider such matters, and give preliminary consideration to information bearing on continuation of each Advisory Agreement. The primary purpose of the December 6 and 7, 2006 meeting was to ensure that the Trustees had ample opportunity to consider matters they deemed relevant in considering the continuation of an Advisory Agreement, and to request any additional information they considered reasonably necessary to their deliberations.
In preparation for the December 6 and 7, 2006 meeting the Trustees were provided, at the request of the Trustees, with a wide range of information to assist in their deliberations, including (i) reports from Lipper Inc. describing a Fund’s (a) performance rankings (where “first quintile” denotes the best performance) (over multiple years ended September 30, 2006) compared with performance groups and performance universes created by Lipper (and in some cases, customized peer groups created by the Adviser) of similar or peer group funds, and (b) expense rankings (where “first quintile” denotes the lowest fees and expenses) comparing the Fund’s contractual advisory fee and total expenses with expense groups and expense universes created by Lipper of similar or peer group funds, (ii) information from the Adviser describing the Fund’s performance (over multiple years ended September 30, 2006) compared with its benchmark and Lipper categories, (iii) for Funds under “close review,” copies of letters from the Adviser to the portfolio manager of each such Fund, together with the portfolio manager’s written response describing the reasons for the Fund’s underperformance (iv) information from the Adviser describing performance for the months of October and November, 2006, and annual performance for the year ended November 30, 2006, (v) reports from the Adviser describing the Adviser’s profitability in providing services under an Advisory Agreement, together with an explanation of Adviser’s methodology in calculating its profitability, (vi) information from the Adviser describing any fees paid to the Adviser for managing similar, non-affiliated institutional accounts, including the range of fee levels for such accounts, and (vii) information from the Adviser describing ancillary benefits, in addition to fees for serving as investment adviser, derived by the Adviser as a result of being investment adviser for a Fund, including, where applicable, information on soft-dollar benefits and fees inuring to the Adviser’s affiliates for serving as the Trust’s administrator, fund accountant and transfer agent.
At the December 6 and 7, 2006 meeting, the Trustees reviewed, considered and discussed, among themselves and with the Adviser, Trust counsel and Independent Legal Counsel, among other things, the information described above, and: (i) the nature, extent and quality of services provided by the Adviser under each Advisory Agreement, (ii) the investment performance of each Fund and the Adviser, (iii) the costs of the services provided by the Adviser under the Advisory Agreement and the profits realized by the Adviser thereunder, (iv) the extent to which economies of scale may be present and, if so, whether they are being shared with a Fund’s shareholders, (v) comparisons of the Adviser’s fees under the Advisory Agreement with investment advisory fees paid by peer group funds to their investment advisers and paid by non-affiliated institutional clients to the Adviser for managing similar accounts, and (vi) any ancillary benefits inuring to the Adviser and its affiliates as a result of being investment adviser for the Trust. The Trustees also considered, where
As part of the December 6 and 7, 2006 Board meeting, the Independent Trustees developed a list of follow-up matters and questions and asked that Adviser respond to such matters and questions at the contract approval meeting of the Board of Trustees to be held on January 11, 2007.
At the January 11, 2007 meeting of the Board of Trustees of the Trust, the Board received and considered information provided by the Adviser in follow-up from the December 6 and 7, 2006 Board meeting and, after consulting among themselves, and with the Adviser, Trust counsel and Independent Legal Counsel, concluded unanimously to renew the Advisory Agreement for the reasons set forth in the following section. In determining whether to renew the Advisory Agreement for the Fund, the Board ultimately reached a determination, with the assistance of Trust counsel and Independent Legal Counsel, that the renewal of the Advisory Agreement and the compensation to be received by the Adviser under the Advisory Agreement is consistent with the Board’s fiduciary duty under applicable law.
(ii) Board Conclusions Regarding the Fund’s Advisory Agreement
The Board considered that the Fund had outperformed its benchmark, the Merrill Lynch Master Index, for the one- and three-year periods, and underperformed the Fund’s benchmark for the five-year period. The Board also considered that the performance of the Fund’s Class I shares ranked in the second quintile of its Lipper-constructed Peer Group over the one-year period and ranked in the first quintile over the two-, three-, four-, and five-year periods reported. The Board found that performance has been very good for all periods considered. Based on its review, and giving particular weight to the nature and quality of the resources dedicated by the Fund’s adviser to maintain relative performance, the Board concluded that performance had been relatively good for all periods presented and the nature, extent, and quality of the services provided to the Fund will benefit Fund shareholders.
The Board also considered that the Fund’s contractual advisory fee and breakpoints placed the Fund in the third quintile of its Lipper-constructed Expense Group and the Fund’s total expenses placed the Fund in the first quintile. The Board concluded that the Fund’s management fee and total expenses were fair and reasonable in light of the services the Fund receives and the other factors discussed.
The Board considered that the Fund’s adviser had reported a pre-tax profit for its investment advisory services during the twelve month periods ended September 30, 2006 and 2005. The Board considered the costs of the services provided by and the profits realized by the Fund’s adviser, in connection with the operation of the Fund and concluded the amount of profit is a fair entrepreneurial profit for the management of the Fund.
Based upon its evaluation of all of the conclusions noted above, and after considering all material factors with respect to the Fund, the Board ultimately concluded that the advisory fee structure is fair and reasonable, and that the Advisory Agreement (and, if applicable, Sub-Advisory Agreement) with respect to the Fund, should be renewed.
B. Approval of New Advisory Agreement
At its January 11, 2007 meeting, the Board also unanimously approved a new investment advisory agreement (the “New Agreement”) for the Fund with Nationwide Fund Advisors, (“NFA”) the then-current adviser to each of the series of the Trust to become effective upon the closing of the acquisition of NFA by Nationwide Financial Services, Inc. (“NFS”) from Nationwide Corporation (“NWC”) which closed on April 30, 2007 (the “Transaction”). In approving the New Agreement, the Board considered NFA’s capacity to continue to provide the services needed to operate a sophisticated investment management business and to support the management of each of the series. The Board also took into account the information provided to them at their regular quarterly meetings with NFA’s senior management with respect to the Fund, including the information provided by management at the Fund’s annual Section 15(c) meetings on December 6-7, 2006 and January 11, 2007. In addition, the Board also considered NFS’ announced intentions, over time, that NFA
C. Submission of Matters to a Vote of Security Holders:
On April 25, 2007, a Special Meeting of Shareholders was held* (the “April 25 Meeting”) at which shareholders of the Funds** set forth below were asked:
Proposal 1:
To approve a new investment advisory agreement, on behalf of their Fund, between Nationwide Fund Advisors (formerly “Gartmore Mutual Fund Capital Trust”) (the “Adviser”) and Nationwide Variable Insurance Trust (formerly “Gartmore Variable Insurance Trust”) (the “Trust”).
Number of Shares | ||||||
Fund | Cast/Not Cast | Percentages | ||||
Federated NVIT High Income Bond Fund (Formerly Federated GVIT High Income Bond Fund) | FOR AGAINST ABSTAIN TOTAL | 30,051,703.188 shares 618,245.021 shares 1,813,550.431 shares 32,483,498.640 shares | 92.514% 1.903% 5.583% | |||
NVIT International Index Fund (Formerly GVIT International Index Fund) | FOR AGAINST ABSTAIN TOTAL | 4,322,203.982 shares 2,758.318 shares 135,636.840 shares 4,460,599.140 shares | 96.897% 0.062% 3.041% | |||
NVIT International Value Fund (Formerly GVIT International Value Fund) | FOR AGAINST ABSTAIN TOTAL | 20,032,843.199 shares 333,588.902 shares 1,093,293.879 shares 21,459,725.980 shares | 93.351% 1.554% 5.095% | |||
NVIT Mid Cap Index Fund (Formerly GVIT Mid Cap Index Fund) | FOR AGAINST ABSTAIN TOTAL | 35,380,179.120 shares 631,117.844 shares 1,565,714.306 shares 37,577,011.270 shares | 94.154% 1.679% 4.167% | |||
NVIT S&P 500 Index Fund (Formerly GVIT S&P 500 Index Fund) | FOR AGAINST ABSTAIN TOTAL | 56,119,814.230 shares 666,195.542 shares 1,944,898.888 shares 58,730,908.660 shares | 95.554% 1.134% 3.312% |
Number of Shares | ||||||
Fund | Cast/Not Cast | Percentages | ||||
Nationwide Multi-Manager NVIT Small Cap Growth Fund (Formerly GVIT Small Cap Growth Fund) | FOR AGAINST ABSTAIN TOTAL | 7,632,918.513 shares 149,458.111 shares 451,583.036 shares 8,233,959.660 shares | 92.700% 1.816% 5.484% | |||
Nationwide Multi-Manager NVIT Small Cap Value Fund (Formerly GVIT Small Cap Value Fund) | FOR AGAINST ABSTAIN TOTAL | 48,649,396.525 shares 979,183.753 shares 2,786,133.102 shares 52,414,713.380 shares | 92.816% 1.868% 5.316% | |||
Nationwide Multi-Manager NVIT Small Company Fund (Formerly GVIT Small Company Fund) | FOR AGAINST ABSTAIN TOTAL | 29,903,181.700 shares 838,774.923 shares 2,006,741.307 shares 32,748,697.930 shares | 91.311% 2.561% 6.128% | |||
Gartmore NVIT Developing Markets Fund (Formerly Gartmore GVIT Developing Markets Fund) | FOR AGAINST ABSTAIN TOTAL | 21,0177,889.443 shares 424,272.958 shares 1,543,850.729 shares 23,046,013.130 shares | 91.460% 1.841% 6.699% | |||
Gartmore NVIT Emerging Markets Fund (Formerly Gartmore GVIT Emerging Markets Fund) | FOR AGAINST ABSTAIN TOTAL | 17,050,534.593 shares 526,574.722 shares 881,608.905 shares 18,458,718.220 shares | 92.371% 2.853% 4.776% | |||
Nationwide NVIT Global Financial Services Fund (Formerly Gartmore GVIT Global Financial Services Fund) | FOR AGAINST ABSTAIN TOTAL | 1,554,847.333 shares 19,539.033 shares 52,206.494 shares 1,626,592.860 shares | 95.589% 1.201% 3.210% | |||
Nationwide NVIT Global Health Sciences Fund (Formerly Gartmore GVIT Global Health Sciences Fund) | FOR AGAINST ABSTAIN TOTAL | 4,722,963.678 shares 157,979.030 shares 207,642.222 shares 5,088,584.930 shares | 92.815% 3.104% 4.081% | |||
Nationwide NVIT Global Technology and Communications Fund (Formerly Gartmore GVIT Global Technology and Communications Fund) | FOR AGAINST ABSTAIN TOTAL | 8,585,472.039 shares 102,267.977 shares 489,577.634 shares 9,177,317.650 shares | 93.551% 1.114% 5.335% | |||
Gartmore NVIT Global Utilities Fund (Formerly Gartmore GVIT Global Utilities Fund) | FOR AGAINST ABSTAIN TOTAL | 4,123,270.549 shares 122,001.533 shares 240,276.088 shares 4,485,548.170 shares | 91.923% 2.720% 5.357% | |||
Nationwide NVIT Government Bond Fund (Formerly Gartmore GVIT Government Bond Fund) | FOR AGAINST ABSTAIN TOTAL | 88,471,567.462 shares 1,825,645.181 shares 5,841,990.727 shares 96,139,203.370 shares | 92.024% 1.899% 6.077% | |||
Nationwide NVIT Growth Fund (Formerly Gartmore GVIT Growth Fund) | FOR AGAINST ABSTAIN TOTAL | 14,931,435.904 shares 409,826.402 shares 1,259,945.064 shares 16,601,207.370 shares | 89.942% 2.469% 7.589% |
Number of Shares | ||||||
Fund | Cast/Not Cast | Percentages | ||||
Gartmore NVIT International Growth Fund (Formerly Gartmore GVIT International Growth Fund) | FOR AGAINST ABSTAIN TOTAL | 6,251,419.070 shares 139,618.548 shares 290,025.592 shares 6,681,063.210 shares | 93.569% 2.090% 4.341% | |||
Nationwide NVIT Investor Destinations Aggressive Fund (Formerly Gartmore GVIT Investor Destinations Aggressive Fund) | FOR AGAINST ABSTAIN TOTAL | 49,489,224.549 shares 1,385,396.474 shares 3,696,272.337 shares 54,570,893.360 shares | 90.688% 2.539% 6.773% | |||
Nationwide NVIT Investor Destinations Conservative Fund (Formerly Gartmore GVIT Investor Destinations Conservative Fund) | FOR AGAINST ABSTAIN TOTAL | 23,091,965.887 shares 314,935,884 shares 2,292,355.179 shares 25,699,256.950 shares | 89.855% 1.225% 8.920% | |||
Nationwide NVIT Investor Destinations Moderate Fund (Formerly Gartmore GVIT Investor Destinations Moderate Fund) | FOR AGAINST ABSTAIN TOTAL | 188,902,093.059 shares 3,018,924.590 shares 16,359,690.401 shares 208,280,708.050 shares | 90.696% 1.449% 7.855% | |||
Nationwide NVIT Investor Destinations Moderately Aggressive Fund (Formerly Gartmore GVIT Investor Destinations Moderately Aggressive Fund) | FOR AGAINST ABSTAIN TOTAL | 134,792,622.920 shares 3,489,207.264 shares 9,304,197.656 shares 147,586,027.840 shares | 91.332% 2.364% 6.304% | |||
Nationwide NVIT Investor Destinations Moderately Conservative Fund (Formerly Gartmore GVIT Investor Destinations Moderately Conservative Fund) | FOR AGAINST ABSTAIN TOTAL | 49,627,123.216 shares 856,088.634 shares 3,507,215.650 shares 53,990,427.500 shares | 91.918% 1.586% 6.496% | |||
Nationwide NVIT Mid Cap Growth Fund (Formerly Gartmore GVIT Mid Cap Growth Fund) | FOR AGAINST ABSTAIN TOTAL | 10,879,584.971 shares 352,594.958 shares 717,792.971 shares 11,949,972.900 shares | 91.043% 2.950% 6.007% | |||
Nationwide NVIT Money Market Fund II (Formerly Gartmore GVIT Money Market Fund II) | FOR AGAINST ABSTAIN TOTAL | 221,774,863.241 shares 12,322,482.494 shares 16,471,740.875 shares 250,569,086.610 shares | 88.508% 4.918% 6.574% | |||
Nationwide NVIT Money Market Fund (Formerly Gartmore GVIT Money Market Fund) | FOR AGAINST ABSTAIN TOTAL | 1,578,331,008.328 shares 32,372,133.671 shares 112,652,123.301 shares 1,723,355,265.300 shares | 91.585% 1.878% 6.537% | |||
NVIT Nationwide Fund (Formerly Gartmore GVIT NationwideFund) | FOR AGAINST ABSTAIN TOTAL | 125,423,274.735 shares 2,767,979.467 shares 8,762,255.828 shares 136,953,510.030 shares | 91.581% 2.021% 6.398% | |||
NVIT Nationwide Leaders Fund (Formerly Gartmore GVIT Nationwide Leaders Fund) | FOR AGAINST ABSTAIN TOTAL | 2,298,504.956 shares 29,630.469 shares 71,637.755 shares 2,399,773.180 shares | 95.780% 1.235% 2.985% |
Number of Shares | ||||||
Fund | Cast/Not Cast | Percentages | ||||
Nationwide NVIT U.S. Growth Leaders Fund (Formerly Gartmore GVIT U.S. Growth Leaders Fund) | FOR AGAINST ABSTAIN TOTAL | 4,972,094.773 shares 122,623.161 shares 174,625.606 shares 5,269,343.540 shares | 94.359% 2.327% 3.314% | |||
Gartmore NVIT Worldwide Leaders Fund (Formerly Gartmore GVIT Worldwide Leaders Fund) | FOR AGAINST ABSTAIN TOTAL | 2,666,862.487 shares 47,702.491 shares 118,719.882 shares 2,833,284.860 shares | 94.126% 1.684% 4.190% | |||
J.P. Morgan NVIT Balanced Fund (Formerly J.P. Morgan GVIT Balanced Fund) | FOR AGAINST ABSTAIN TOTAL | 15,966,867.546 shares 259,004.324 shares 1,339,385.200 shares 17,565,257.070 shares | 90.900% 1.475% 7.625% | |||
Van Kampen NVIT Comstock Value Fund (Formerly Van Kampen GVIT Comstock Value Fund) | FOR AGAINST ABSTAIN TOTAL | 27,737,008.009 shares 502,564.164 shares 1,824,670.107 shares 30,064,242.280 shares | 92.259% 1.672% 6.069% | |||
Van Kampen NVIT Multi Sector Bond Fund (Formerly Van Kampen GVIT Multi Sector Bond Fund) | FOR AGAINST ABSTAIN TOTAL | 21,253,297.665 shares 484,100.920 shares 1,803,963.645 shares 23,541,362.230 shares | 90.281% 2.056% 7.663% | |||
At the April 25 Meeting, shareholders of the Nationwide NVIT Mid Cap Growth Fund were also asked to approve a new investment subadvisory agreement among the Adviser, the Trust and NorthPointe Capital LLC. The voting results with respect to that proposal are set forth below:
Proposal 2
Number of Shares | ||||||
Fund | Cast/Not Cast | Percentages | ||||
Nationwide NVIT Mid Cap Growth Fund (Formerly Gartmore GVIT Mid Cap Growth Fund) | FOR AGAINST ABSTAIN TOTAL | 10,862,827.499 shares 414,574.660 shares 672,570.741 shares 11,949,972.900 shares | 90.903% 3.469% 5.628% | |||
* | This meeting was previously adjourned on April 23, 2007. | |
** | Fund names were changed effective May 1, 2007 to reflect “Nationwide”/ “NVIT” branding to coincide with the sale of Nationwide Fund Advisors, Inc. by Nationwide Corporation to its majority-owned subsidiary, Nationwide Financial Services, Inc. |
June 30, 2007 (Unaudited)
Contents | ||
6 | Statement of Investments | |
9 | Statement of Assets and Liabilities | |
10 | Statement of Operations | |
11 | Statements of Changes in Net Assets | |
13 | Financial Highlights | |
14 | Notes to Financial Statements |
Statement Regarding Availability of Proxy Voting Record.
SAR-GR (8/07) | ![]() |
Dear Fellow Shareholder:
Since I last wrote to you, our mutual funds have enjoyed another period of solid performance, and the corporate realignment that was in progress is now finished.
On May 1, 2007, Nationwide Financial Services, Inc. (NFS), completed its acquisition of the Philadelphia-based retail mutual fund operations of NWD Investment Management, Inc. (formerly, “Gartmore Global Investments, Inc.”), from Nationwide Corporation, a subsidiary of Nationwide Mutual Insurance Company. Effective that date, the acquired entities were renamed Nationwide Funds Group (NFG), and the Gartmore Funds were renamed the Nationwide Funds to better align with the Nationwide® brand. Although the corporate ownership and fund names have changed, I can assure you that NFG intends to maintain as much continuity as possible with the Funds and key personnel.
Thank you, shareholders, for approving the new investment advisory agreement that was required due to the change in corporate ownership. The new agreement is identical in all material respects to the original agreement that it replaces, with the exception of the section pertaining to the vote by the shareholders of the NVIT Mid Cap Growth Fund to approve NorthPointe Capital®, LLC (NorthPointe) as sub-adviser to that particular Fund.
Market Overview: January 1-June 30, 2007
Share prices in general were buoyed in part by better-than-expected first-quarter 2007 earnings and a flurry of mergers and acquisitions, many of these spurred by readily available funding from private equity firms. In June, investors grew more cautious amid surging crude oil prices, a sudden spike in long-term interest rates, and the meltdown of two hedge funds that had exposure to the subprime mortgage market. Looking abroad, a weak U.S. dollar aided foreign stocks, as reflected in the 11.09% advance of the Morgan Stanley Capital International Europe, Australasia and Far East (MSCI EAFE®) Index. Emerging market performance was particularly robust.
The bond market struggled during the first half of 2007. While short-term interest rates remained stable, reflecting the Federal Reserve Board’s decision in June to leave the target federal funds rate at 5.25%, longer-term rates climbed during the first half of 2007, depressing bond prices and forcing the Lehman Brothers® U.S. Aggregate Index to settle for a modest 0.97% return.
We at NFG thank you for your understanding and cooperation throughout our recent transition period. We emerge from this period energized for the future, and we look forward to serving your investment needs for a long time to come.
Nationwide Funds Group
PAST PERFORMANCE IS NO GUARANTEE OF FUTURE RESULTS.
Nationwide Funds are advised by Nationwide Fund Advisors (NFA). NFA is a wholly-owned subsidiary of Nationwide Financial Services. Nationwide Financial Services is a wholly-owned subsidiary of Nationwide Corporation. All of the common stock of Nationwide Corporation is held by Nationwide Mutual (95.2%) and Nationwide Mutual Fire Insurance Company (4.8%), each of which is a mutual company owned by its policyholders.
Nationwide Funds Group (NFG) is the mutual fund arm of Nationwide Financial Services (NYSE: NFS). Based in Conshohocken, Pa., a suburb of Philadelphia, NFG is comprised of Nationwide Fund Advisors, Nationwide Fund Distributors, LLC, and Nationwide Fund Management, LLC. Together, these provide advisory, distribution, and administration services respectively to the Nationwide Funds, and manage more than $43.5 billion in assets as of June 30, 2007, of which more than $12 billion are in “fund of funds” designed to provide asset allocation across several types of investments and asset classes.
Lehman Brothers (LB) U.S. Aggregate Index: An unmanaged, market value-weighted index of investment-grade, fixed-rate debt issues (including government, corporate, asset-backed, and mortgage-backed securities with maturities of one year or more) that is generally representative of the bond market as a whole.
Morgan Stanley Capital International Europe, Australasia and Far East (MSCI EAFE®) Index: An unmanaged, free float-adjusted, market capitalization-weighted index that is designed to measure the performance of stocks in developed markets outside the United States and Canada.
Standard & Poor’s 500® (S&P 500) Index: An unmanaged, market capitalization-weighted index of 500 widely held stocks of large-cap U.S. companies that gives a broad look at how the stock prices of those companies have performed.
Views expressed within are those of Nationwide Funds Group as of the date noted, are subject to change at any time, and may not come to pass.
This report is for informational purposes only, and is not intended as an offer or recommendation with respect to the purchase or sale of any security, option, future, or other derivatives in such securities.
Investing in mutual funds involves risk, including possible loss of principal.
Investors should carefully consider a fund’s investment objectives, risks, fees, charges, and expenses before investing any money. To obtain this and other fund information, please call 800-848-0920 to request a prospectus, or download a prospectus at www.nationwidefunds.com. Please read the prospectus carefully before investing any money.
Nationwide Funds distributed by Nationwide Fund Distributors LLC (formerly Gartmore Distribution Services, Inc.), Member NASD. 1200 River Road, Suite 1000, Conshohocken, Pa. 19428.
As a shareholder of the Fund, you incur two types of costs: (1) transaction costs, including sales charges (loads) paid on purchase payments and redemption fees; and (2) ongoing costs, including investment advisory fees, administration fees, distribution fees and other Fund expenses. The examples below are 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. Per SEC requirements, the examples assume that you had a $1,000 investment in the Class at the beginning of the reporting period, January 1, 2007, and continued to hold your shares at the end of the reporting period, June 30, 2007.
Actual Expenses
Hypothetical Example for Comparison Purposes
Please note that the expenses shown in the table are meant to highlight your ongoing costs only and do not reflect any transaction costs, such as sales charges (loads) or redemption fees. Therefore, the second line for each Class in 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 transaction costs were included, your costs would have been higher. The examples also assume all dividends and distributions have been reinvested.
Schedule of Shareholder Expenses
Nationwide NVIT Growth Fund | ||||||||||||||||||||||
Beginning | Ending | Expenses Paid | Annualized | |||||||||||||||||||
Account Value, | Account | During Period* | Expense Ratio* | |||||||||||||||||||
January 1, 2007 | Value, | |||||||||||||||||||||
June 30, 2007 | ||||||||||||||||||||||
Class I | Actual | $ | 1,000.00 | $ | 1,116.20 | �� | $ | 4.46 | 0.85% | |||||||||||||
Hypothetical | 1 | $ | 1,000.00 | $ | 1,020.58 | $ | 4.27 | 0.85% | ||||||||||||||
Class IV | Actual | $ | 1,000.00 | $ | 1,115.30 | $ | 4.46 | 0.85% | ||||||||||||||
Hypothetical | 1 | $ | 1,000.00 | $ | 1,020.58 | $ | 4.27 | 0.85% | ||||||||||||||
* | Expenses are equal to the Fund’s annualized expense ratio multiplied by the average account value over the period multiplied by 181/365 (to reflect the one-half year period). The expense ratio presented represents a six-month, annualized ratio in accordance with SEC guidelines. The expenses reported above do not include the effect of additional expenses imposed by variable annuity contracts. | |
1 | Represents the hypothetical 5% return before expenses. |
Asset Allocation | ||||
Common Stock | 100.0% | |||
Other Investments* | 4.9% | |||
Liabilities in excess of other assets** | -4.9% | |||
100.0% |
Top Holdings | ||||
Microsoft Corp. | 3.5% | |||
Cisco Systems, Inc. | 3.5% | |||
Intel Corp. | 2.7% | |||
Google, Inc., Class A | 2.3% | |||
Hewlett-Packard Co. | 2.0% | |||
Boeing Co. (The) | 1.8% | |||
QUALCOMM, Inc. | 1.8% | |||
Comcast Corp., Class A | 1.7% | |||
Wyeth | 1.6% | |||
Apple, Inc. | 1.6% | |||
Other | 77.5% | |||
100.0% |
Top Industries | ||||
Pharmaceuticals | 7.2% | |||
Semiconductors & Semiconductor Equipment | 7.2% | |||
Communications Equipment | 6.8% | |||
Software | 6.2% | |||
Aerospace & Defense | 5.7% | |||
Computers & Peripherals | 5.7% | |||
Internet Software & Services | 4.4% | |||
Biotechnology | 4.1% | |||
Oil, Gas & Consumable Fuels | 3.6% | |||
Diversified Financial Services | 3.6% | |||
Other | 45.5% | |||
100.0% |
* | Includes value of collateral received from securities lending. |
** | Includes value of collateral owed from securities lending. |
Nationwide NVIT Growth Fund
Common Stock (100.0%) | ||||||||
Shares or | ||||||||
Principal Amount | Value | |||||||
Aerospace & Defense (5.7%) | ||||||||
Boeing Co. (The) | 39,670 | $ | 3,814,667 | |||||
Honeywell International, Inc. | 20,880 | 1,175,126 | ||||||
Precision Castparts Corp. | 12,230 | 1,484,233 | ||||||
Raytheon Co. | 23,150 | 1,247,553 | ||||||
Rockwell Collins, Inc. | 37,470 | 2,646,881 | ||||||
Spirit Aerosystems Holdings, Inc., Class A* | 20,890 | 753,085 | ||||||
United Technologies Corp. | 12,450 | 883,079 | ||||||
12,004,624 | ||||||||
Air Freight & Logistics (1.1%) | ||||||||
C.H. Robinson Worldwide, Inc. | 20,000 | 1,050,400 | ||||||
FedEx Corp. | 11,700 | 1,298,349 | ||||||
2,348,749 | ||||||||
Auto Components (1.1%) | ||||||||
Johnson Controls, Inc. | 19,930 | 2,307,296 | ||||||
Beverages (1.0%) | ||||||||
Coca-Cola Co. | 29,090 | 1,521,698 | ||||||
Pepsi Bottling Group, Inc. (The) | 15,500 | 522,040 | ||||||
2,043,738 | ||||||||
Biotechnology (4.1%) | ||||||||
Celgene Corp.* | 27,660 | 1,585,748 | ||||||
Cephalon, Inc.* | 6,790 | 545,848 | ||||||
Genentech, Inc.* | 13,300 | 1,006,278 | ||||||
Genzyme Corp.* | 25,180 | 1,621,592 | ||||||
Gilead Sciences, Inc.* | 77,350 | 2,998,859 | ||||||
Pharmion Corp.* (a) | 29,130 | 843,314 | ||||||
8,601,639 | ||||||||
Capital Markets (1.4%) | ||||||||
Lehman Brothers Holding, Inc. | 21,790 | 1,623,791 | ||||||
Northern Trust Corp. | 19,620 | 1,260,389 | ||||||
2,884,180 | ||||||||
Chemicals (2.2%) | ||||||||
Air Products & Chemicals, Inc. | 19,250 | 1,547,123 | ||||||
Monsanto Co. | 45,730 | 3,088,604 | ||||||
4,635,727 | ||||||||
Commercial Services & Supplies (0.2%) | ||||||||
Pitney Bowes, Inc. | 9,000 | 421,380 | ||||||
Communications Equipment (7.2%) | ||||||||
American Tower Corp.* | 22,000 | 924,000 | ||||||
Cisco Systems, Inc.* | 263,610 | 7,341,538 | ||||||
Corning, Inc.* | 81,970 | 2,094,334 | ||||||
Foundry Networks, Inc.* (a) | 62,660 | 1,043,916 | ||||||
QUALCOMM, Inc. | 84,960 | 3,686,414 | ||||||
15,090,202 | ||||||||
Computers & Peripherals (5.7%) | ||||||||
Apple, Inc.* | 27,700 | 3,380,508 | ||||||
Diebold, Inc. (a) | 7,680 | 400,896 | ||||||
Hewlett-Packard Co. | 94,450 | 4,214,359 | ||||||
International Business Machines Corp. | 18,100 | 1,905,025 | ||||||
Research In Motion* | 8,800 | 1,759,912 | ||||||
Western Digital Corp.* | 13,700 | 265,095 | ||||||
11,925,795 | ||||||||
Construction & Engineering (0.1%) | ||||||||
Fluor Corp. | 2,400 | 267,288 | ||||||
Consumer Finance (0.6%) | ||||||||
American Express Co. | 20,380 | 1,246,848 | ||||||
Diversified Financial Services (3.6%) | ||||||||
Chicago Mercantile Exchange Holdings, Inc. | 3,050 | 1,629,798 | ||||||
Franklin Resources, Inc. | 13,770 | 1,824,112 | ||||||
Goldman Sachs Group, Inc. | 7,740 | 1,677,645 | ||||||
IntercontinentalExchange, Inc.* | 7,650 | 1,131,052 | ||||||
Merrill Lynch & Co., Inc. | 8,800 | 735,504 | ||||||
Morgan Stanley | 7,100 | 595,548 | ||||||
7,593,659 | ||||||||
Electrical Equipment (2.6%) | ||||||||
Ametek, Inc. (a) | 39,525 | 1,568,352 | ||||||
Cooper Industries Ltd., Class A ADR - BM | 30,330 | 1,731,540 | ||||||
Emerson Electric Co. | 44,870 | 2,099,916 | ||||||
5,399,808 | ||||||||
Electronic Equipment & Instruments (0.1%) | ||||||||
Jabil Circuit, Inc. | 12,980 | 286,469 | ||||||
Energy Equipment & Services (1.8%) | ||||||||
Halliburton Co. | 9,940 | 342,930 | ||||||
Smith International, Inc. | 11,050 | 647,972 | ||||||
Transocean, Inc. ADR - KY* | 25,220 | 2,672,816 | ||||||
3,663,718 | ||||||||
Entertainment (1.0%) | ||||||||
Walt Disney Co. (The) | 62,250 | 2,125,215 | ||||||
Common Stock (continued) | ||||||||
Shares or | ||||||||
Principal Amount | Value | |||||||
Food & Staples Retailing (2.6%) | ||||||||
Costco Wholesale Corp. | 22,750 | $ | 1,331,330 | |||||
CVS/ Caremark Corp. | 78,509 | 2,861,653 | ||||||
Kroger Co. | 9,700 | 272,861 | ||||||
SYSCO Corp. | 7,050 | 232,579 | ||||||
Wal-Mart Stores, Inc. | 17,380 | 836,152 | ||||||
5,534,575 | ||||||||
Food Products (2.1%) | ||||||||
General Mills, Inc. | 11,550 | 674,751 | ||||||
PepsiCo, Inc. | 50,900 | 3,300,865 | ||||||
Sara Lee Corp. | 19,100 | 332,340 | ||||||
4,307,956 | ||||||||
Gas Utilities (0.3%) | ||||||||
Questar Corp. | 11,000 | 581,350 | ||||||
Health Care Equipment & Supplies (3.0%) | ||||||||
Baxter International, Inc. | 30,690 | 1,729,074 | ||||||
Beckman Coulter, Inc. | 6,320 | 408,778 | ||||||
Becton, Dickinson & Co. | 12,650 | 942,425 | ||||||
Dade Behring Holdings, Inc. | 6,500 | 345,280 | ||||||
Hillenbrand Industry, Inc. (a) | 7,860 | 510,900 | ||||||
Hologic, Inc.* (a) | 15,290 | 845,690 | ||||||
Medtronic, Inc. | 29,600 | 1,535,056 | ||||||
6,317,203 | ||||||||
Health Care Providers & Services (2.3%) | ||||||||
Cardinal Health, Inc. | 14,050 | 992,492 | ||||||
McKesson Corp. | 22,820 | 1,360,985 | ||||||
Medco Health Solutions, Inc.* | 14,340 | 1,118,377 | ||||||
UnitedHealth Group, Inc. | 27,740 | 1,418,623 | ||||||
4,890,477 | ||||||||
Hotels, Restaurants & Leisure (2.0%) | ||||||||
MGM Grand, Inc.* | 18,680 | 1,540,726 | ||||||
P.F. Chang’s China Bistro, Inc.* (a) | 20,460 | 720,192 | ||||||
Starwood Hotels & Resorts Worldwide, Inc. | 30,030 | 2,014,112 | ||||||
4,275,030 | ||||||||
Household Durables (0.6%) | ||||||||
Leggett & Platt, Inc. (a) | 14,170 | 312,448 | ||||||
Newell Rubbermaid, Inc. | 20,200 | 594,486 | ||||||
Snap-on, Inc. | 8,760 | 442,468 | ||||||
1,349,402 | ||||||||
Household Products (0.8%) | ||||||||
Procter & Gamble Co. (The) | 25,720 | 1,573,807 | ||||||
Industrial Conglomerates (0.8%) | ||||||||
Textron, Inc. | 15,160 | 1,669,268 | ||||||
Insurance (0.8%) | ||||||||
AFLAC, Inc. | 32,500 | 1,670,500 | ||||||
Internet Software & Services (4.4%) | ||||||||
Akamai Technologies, Inc.* | 39,670 | 1,929,549 | ||||||
eBay, Inc.* | 50,160 | 1,614,149 | ||||||
Google, Inc., Class A* | 9,270 | 4,851,732 | ||||||
Yahoo!, Inc.* | 30,940 | 839,402 | ||||||
9,234,832 | ||||||||
IT Services (0.6%) | ||||||||
Cognizant Technology Solutions Corp.* | 13,980 | 1,049,758 | ||||||
Electronic Data Systems Corp. | 10,420 | 288,947 | ||||||
1,338,705 | ||||||||
Life Sciences Tools & Services (1.8%) | ||||||||
Covance, Inc.* (a) | 15,080 | 1,033,885 | ||||||
Pharmaceutical Product Development, Inc. (a) | 21,900 | 838,113 | ||||||
Thermo Fisher Scientific, Inc.* | 36,570 | 1,891,400 | ||||||
3,763,398 | ||||||||
Machinery (2.1%) | ||||||||
Caterpillar, Inc. | 30,500 | 2,388,150 | ||||||
Cummins, Inc. | 5,340 | 540,461 | ||||||
Harsco Corp. | 10,300 | 535,600 | ||||||
Parker Hannifin Corp. | 10,100 | 988,891 | ||||||
4,453,102 | ||||||||
Manufacturing (0.7%) | ||||||||
Polypore International, Inc.* | 80,300 | 1,410,871 | ||||||
Media (1.7%) | ||||||||
Comcast Corp., Class A* | 129,765 | 3,648,992 | ||||||
Metals & Mining (1.6%) | ||||||||
Alcoa, Inc. | 10,700 | 433,671 | ||||||
Allegheny Technologies, Inc. | 15,640 | 1,640,323 | ||||||
Freeport-McMoRan Copper & Gold, Inc., Class B | 15,500 | 1,283,710 | ||||||
3,357,704 | ||||||||
Multiline Retail (2.6%) | ||||||||
Family Dollar Stores, Inc. | 12,380 | 424,881 | ||||||
Kohl’s Corp.* | 29,760 | 2,113,853 | ||||||
Macy’s, Inc. | 9,750 | 387,855 | ||||||
Target Corp. | 39,800 | 2,531,280 | ||||||
5,457,869 | ||||||||
Nationwide NVIT Growth Fund (Continued)
Common Stock (continued) | ||||||||
Shares or | ||||||||
Principal Amount | Value | |||||||
Oil, Gas & Consumable Fuels (3.6%) | ||||||||
Clean Energy Fuel Corp.* | 70,950 | $ | 891,132 | |||||
CONSOL Energy, Inc. | 22,380 | 1,031,942 | ||||||
Peabody Energy Corp. | 22,810 | 1,103,548 | ||||||
Sunoco, Inc. | 4,550 | 362,544 | ||||||
Valero Energy Corp. | 16,730 | 1,235,678 | ||||||
Williams Cos., Inc. (The) | 27,670 | 874,925 | ||||||
XTO Energy, Inc. | 35,610 | 2,140,161 | ||||||
7,639,930 | ||||||||
Pharmaceuticals (7.2%) | ||||||||
Abbott Laboratories | 58,000 | 3,105,900 | ||||||
Bristol-Myers Squibb Co. | 65,800 | 2,076,648 | ||||||
Johnson & Johnson | 25,390 | 1,564,532 | ||||||
Merck & Co., Inc. | 63,680 | 3,171,264 | ||||||
Schering-Plough Corp. | 56,500 | 1,719,860 | ||||||
Wyeth | 59,410 | 3,406,569 | ||||||
15,044,773 | ||||||||
Real Estate Investment Trusts (REITs) (0.6%) (a) | ||||||||
Rayonier, Inc. | 29,700 | 1,340,658 | ||||||
Road & Rail (0.8%) | ||||||||
Burlington Northern Santa Fe Corp. | 3,800 | 323,532 | ||||||
Union Pacific Corp. | 11,700 | 1,347,255 | ||||||
1,670,787 | ||||||||
Semiconductors & Semiconductor Equipment (7.2%) | ||||||||
Intel Corp. | 233,700 | 5,552,712 | ||||||
Intersil Corp. | 51,620 | 1,623,965 | ||||||
MEMC Electronic Materials, Inc.* | 29,300 | 1,790,816 | ||||||
Microchip Technology, Inc. (a) | 51,350 | 1,902,004 | ||||||
NVIDIA Corp.* | 52,220 | 2,157,208 | ||||||
Spansion, Inc., Class A* (a) | 20,200 | 224,220 | ||||||
Texas Instruments, Inc. | 46,700 | 1,757,321 | ||||||
15,008,246 | ||||||||
Service Companies (0.3%) (a) | ||||||||
Brookdale Senior Living, Inc. | 11,340 | 516,764 | ||||||
Software (6.2%) | ||||||||
Adobe Systems, Inc.* | 52,030 | 2,089,005 | ||||||
Electronic Arts, Inc.* | 17,300 | 818,636 | ||||||
Microsoft Corp. | 254,590 | 7,502,767 | ||||||
Oracle Corp.* | 136,100 | 2,682,531 | ||||||
13,092,939 | ||||||||
Specialty Retail (2.7%) | ||||||||
Best Buy Co., Inc. | 22,570 | 1,053,342 | ||||||
Coach, Inc.* | 28,900 | 1,369,571 | ||||||
Home Depot, Inc. (The) | 28,000 | 1,101,800 | ||||||
Lowe’s Cos., Inc. | 47,150 | 1,447,034 | ||||||
Staples, Inc. | 30,510 | 724,002 | ||||||
5,695,749 | ||||||||
Textiles, Apparel & Luxury Goods (0.5%) | ||||||||
Phillips-Van Heusen Corp. | 17,600 | 1,066,032 | ||||||
Transportation (0.4%) (a) | ||||||||
Genesis Lease Ltd. ADR — IE | 31,490 | 862,826 | ||||||
Wireless Telecommunication Services (0.2%) | ||||||||
Telephone & Data Systems, Inc. | 6,130 | 383,554 | ||||||
Total Common Stocks (Cost $194,531,612) | 210,003,634 | |||||||
Securities Held as Collateral for Securities on Loan (4.9%) | ||||||||
Morgan Stanley Repurchase Agreement, 5.42%, dated 06/29/07, due 07/02/07, repurchase price $10,374,397 collateralized by U.S. Government Agency Mortgages with a market value of $10,577,107 | $ | 10,369,713 | 10,369,713 | |||||
Total Investments (Cost $204,901,325) (b) — 104.9% | 220,373,347 | |||||||
Liabilities in excess of other assets — (4.9)% | (10,283,626 | ) | ||||||
NET ASSETS — 100.0% | $ | 210,089,721 | ||||||
* | Denotes a non-income producing security. | |
(a) | All or a part of the security was on loan as of June 30, 2007. | |
(b) | See notes to financial statements for tax unrealized appreciation (depreciation) of securities. |
ADR | American Depository Receipt | |
BM | Bermuda | |
IE | Ireland | |
KY | Cayman Islands |
See accompanying notes to financial statements.
Nationwide NVIT | ||||||
Growth Fund | ||||||
Assets: | ||||||
Investments, at value (cost $194,531,612)* | $ | 210,003,634 | ||||
Repurchase agreements, at cost and value | 10,369,713 | |||||
Total Investments | 220,373,347 | |||||
Interest and dividends receivable | 88,447 | |||||
Receivable for capital shares issued | 630 | |||||
Receivable for investments sold | 12,429,382 | |||||
Prepaid expenses | 2,023 | |||||
Total Assets | 232,893,829 | |||||
Liabilities: | ||||||
Payable to custodian | 1,128,563 | |||||
Payable for investments purchased | 10,970,275 | |||||
Payable upon return of securities loaned | 10,369,713 | |||||
Payable for capital shares redeemed | 172,056 | |||||
Accrued expenses and other payables: | ||||||
Investment advisory fees | 104,865 | |||||
Fund administration and transfer agent fees | 12,845 | |||||
Administrative servicing fees | 16,266 | |||||
Compliance program costs | 2,766 | |||||
Other | 26,759 | |||||
Total Liabilities | 22,804,108 | |||||
Net Assets | $ | 210,089,721 | ||||
Represented by: | ||||||
Capital | $ | 466,799,971 | ||||
Accumulated net investment loss | (9,144 | ) | ||||
Accumulated net realized losses from investment transactions | (272,173,128 | ) | ||||
Net unrealized appreciation on investments | 15,472,022 | |||||
Net Assets | $ | 210,089,721 | ||||
Net Assets: | ||||||
Class I Shares | $ | 174,629,607 | ||||
Class IV Shares | 35,460,114 | |||||
Total | $ | 210,089,721 | ||||
Shares outstanding (unlimited number of shares authorized): | ||||||
Class I Shares | 12,891,509 | |||||
Class IV Shares | 2,618,250 | |||||
Total | 15,509,759 | |||||
Net asset value and offering price per share (Net assets by class divided by shares outstanding by class, respectively.): | ||||||
Class I Shares | $ | 13.55 | ||||
Class IV Shares | $ | 13.54 | ||||
* | Includes value of securities on loan of $10,143,631. |
9
Nationwide NVIT | |||||
Growth Fund | |||||
INVESTMENT INCOME: | |||||
Interest income | $ | 25,161 | |||
Dividend income | 998,869 | ||||
Income from securities lending | 29,817 | ||||
Total Income | 1,053,847 | ||||
Expenses: | |||||
Investment advisory fees | 622,365 | ||||
Fund administration and transfer agent fees | 64,307 | ||||
Administrative servicing fees Class I Shares | 118,353 | ||||
Administrative servicing fees Class IV Shares | 24,456 | ||||
Custodian fees | 15,287 | ||||
Trustee fees | 4,802 | ||||
Compliance program costs (Note 3) | 1,454 | ||||
Other | 33,204 | ||||
Total expenses before earnings credit | 884,228 | ||||
Earnings credit (Note 6) | (2,711 | ) | |||
Net Expenses | 881,517 | ||||
Net Investment Income | 172,330 | ||||
REALIZED/ UNREALIZED GAINS (LOSSES) FROM INVESTMENTS: | |||||
Net realized gains on investment transactions | 21,363,269 | ||||
Net change in unrealized appreciation on investments | 1,313,733 | ||||
Net realized/unrealized gains (losses) on investments | 22,677,002 | ||||
CHANGE IN NET ASSETS RESULTING FROM OPERATIONS | $ | 22,849,332 | |||
10
Nationwide NVIT Growth Fund | |||||||||
Six Months Ended | Year Ended | ||||||||
June 30, 2007 | December 31, 2006 | ||||||||
(Unaudited) | |||||||||
FROM INVESTMENT ACTIVITIES: | |||||||||
Operations: | |||||||||
Net investment income | $ | 172,330 | $ | 89,970 | |||||
Net realized gains on investment transactions | 21,363,269 | 8,761,695 | |||||||
Net change in unrealized appreciation on investments | 1,313,733 | 3,499,676 | |||||||
Change in net assets resulting from operations | 22,849,332 | 12,351,341 | |||||||
Distributions to shareholders from: | |||||||||
Net investment income: | |||||||||
Class I | (151,985 | ) | (88,690 | ) | |||||
Class IV | (29,489 | ) | (18,161 | ) | |||||
Change in net assets from shareholder distributions | (181,474 | ) | (106,851 | ) | |||||
Change in net assets from capital transactions | (18,127,282 | ) | (42,349,928 | ) | |||||
Change in net assets | 4,540,576 | (30,105,438 | ) | ||||||
Net Assets: | |||||||||
Beginning of period | 205,549,145 | 235,654,583 | |||||||
End of period | $ | 210,089,721 | $ | 205,549,145 | |||||
Accumulated net investment income (loss) at end of period | $ | (9,144 | ) | $ | – | ||||
CAPITAL TRANSACTIONS: | |||||||||
Class I Shares | |||||||||
Proceeds from shares issued | $ | 5,744,695 | $ | 3,190,556 | |||||
Dividends reinvested | 151,985 | 88,690 | |||||||
Cost of shares redeemed | (21,751,755 | ) | (41,370,555 | ) | |||||
(15,855,075 | ) | (38,091,309 | ) | ||||||
Class IV Shares | |||||||||
Proceeds from shares issued | 687,645 | 1,940,914 | |||||||
Dividends reinvested | 29,486 | 18,161 | |||||||
Cost of shares redeemed | (2,989,338 | ) | (6,217,694 | ) | |||||
(2,272,207 | ) | (4,258,619 | ) | ||||||
Change in net assets from capital transactions | $ | (18,127,282 | ) | $ | (42,349,928 | ) | |||
11
Nationwide NVIT Growth Fund | |||||||||
Six Months Ended | Year Ended | ||||||||
June 30, 2007 | December 31, 2006 | ||||||||
(Unaudited) | |||||||||
SHARE TRANSACTIONS: | |||||||||
Class I Shares | |||||||||
Issued | 436,736 | 276,469 | |||||||
Reinvested | 11,283 | 7,264 | |||||||
Redeemed | (1,682,534 | ) | (3,577,655 | ) | |||||
(1,234,515 | ) | (3,293,922 | ) | ||||||
Class IV Shares | |||||||||
Issued | 53,012 | 167,685 | |||||||
Reinvested | 2,189 | 1,487 | |||||||
Redeemed | (231,188 | ) | (538,055 | ) | |||||
(175,987 | ) | (368,883 | ) | ||||||
Total change in shares | (1,410,502 | ) | (3,662,805 | ) | |||||
12
Investment Activities | ||||||||||||||||
Net Realized | ||||||||||||||||
and | ||||||||||||||||
Net Asset | Unrealized | Total | ||||||||||||||
Value, | Net | Gains | from | |||||||||||||
Beginning | Investment | (Losses) on | Investment | |||||||||||||
of Period | Income | Investments | Activities | |||||||||||||
Class I Shares | ||||||||||||||||
For the year ended December 31, 2002 | $ | 10.55 | – | (3.03 | ) | (3.03 | ) | |||||||||
For the year ended December 31, 2003 | $ | 7.52 | 0.01 | 2.45 | 2.46 | |||||||||||
For the year ended December 31, 2004 | $ | 9.98 | 0.02 | 0.79 | 0.81 | |||||||||||
For the year ended December 31, 2005 | $ | 10.76 | 0.01 | 0.69 | 0.70 | |||||||||||
For the year ended December 31, 2006 | $ | 11.45 | 0.01 | 0.70 | 0.71 | |||||||||||
For the six months ended June 30, 2007 (Unaudited) | $ | 12.15 | 0.01 | 1.40 | 1.41 | |||||||||||
Class IV Shares | ||||||||||||||||
For the year ended December 31, 2003 (e) | $ | 7.90 | – | 2.08 | 2.08 | |||||||||||
For the year ended December 31, 2004 | $ | 9.98 | 0.02 | 0.79 | 0.81 | |||||||||||
For the year ended December 31, 2005 | $ | 10.76 | 0.01 | 0.69 | 0.70 | |||||||||||
For the year ended December 31, 2006 | $ | 11.45 | 0.01 | 0.70 | 0.71 | |||||||||||
For the six months ended June 30, 2007 (Unaudited) | $ | 12.15 | 0.01 | 1.39 | 1.40 | |||||||||||
[Additional columns below]
[Continued from above table, first column(s) repeated]
Distributions | Ratios/Supplemental Data | |||||||||||||||||||||||
Ratio of | ||||||||||||||||||||||||
Net Assets | Expenses to | |||||||||||||||||||||||
Net | Net Asset | at End of | Average | |||||||||||||||||||||
Investment | Total | Value, End | Total | Period | Net | |||||||||||||||||||
Income | Distributions | of Period | Return (a) | (000s) | Assets (b) | |||||||||||||||||||
Class I Shares | ||||||||||||||||||||||||
For the year ended December 31, 2002 | – | – | $ | 7.52 | (28.72% | ) | $ | 201,689 | 0.85% | |||||||||||||||
For the year ended December 31, 2003 | (f | ) | – | $ | 9.98 | 32.74% | $ | 244,671 | 0.84% | |||||||||||||||
For the year ended December 31, 2004 | (0.03 | ) | (0.03 | ) | $ | 10.76 | 8.16% | $ | 224,301 | 0.85% | ||||||||||||||
For the year ended December 31, 2005 | (0.01 | ) | (0.01 | ) | $ | 11.45 | 6.50% | $ | 199,446 | 0.87% | ||||||||||||||
For the year ended December 31, 2006 | (0.01 | ) | (0.01 | ) | $ | 12.15 | 6.17% | $ | 171,610 | 0.87% | ||||||||||||||
For the six months ended June 30, 2007 (Unaudited) | (0.01 | ) | (0.01 | ) | $ | 13.55 | 11.62% | $ | 174,630 | 0.85% | ||||||||||||||
Class IV Shares | ||||||||||||||||||||||||
For the year ended December 31, 2003 (e) | (f | ) | – | $ | 9.98 | 26.37% | $ | 34,090 | 0.84% | |||||||||||||||
For the year ended December 31, 2004 | (0.03 | ) | (0.03 | ) | $ | 10.76 | 8.16% | $ | 38,067 | 0.85% | ||||||||||||||
For the year ended December 31, 2005 | (0.01 | ) | (0.01 | ) | $ | 11.45 | 6.50% | $ | 36,209 | 0.87% | ||||||||||||||
For the year ended December 31, 2006 | (0.01 | ) | (0.01 | ) | $ | 12.15 | 6.17% | $ | 33,939 | 0.87% | ||||||||||||||
For the six months ended June 30, 2007 (Unaudited) | (0.01 | ) | (0.01 | ) | $ | 13.54 | 11.53% | $ | 35,460 | 0.85% | ||||||||||||||
[Additional columns below]
[Continued from above table, first column(s) repeated]
Ratios/Supplemental Data | ||||||||||||||||||
Ratio of | ||||||||||||||||||
Ratio of | Investment | |||||||||||||||||
Ratio of Net | Expenses | Income (Loss) | ||||||||||||||||
Investment | (Prior to | (Prior to | ||||||||||||||||
Income (Loss) | Reimbursements) | Reimbursements) | ||||||||||||||||
to Average | to Average | to Average | Portfolio | |||||||||||||||
Net Assets (b) | Net Assets (b)(c) | Net Assets (b)(c) | Turnover (d) | |||||||||||||||
Class I Shares | ||||||||||||||||||
For the year ended December 31, 2002 | (0.03% | ) | 0.85% | (0.03% | ) | 231.69% | ||||||||||||
For the year ended December 31, 2003 | 0.09% | (g) | (g) | 293.58% | ||||||||||||||
For the year ended December 31, 2004 | 0.26% | (g) | (g) | 282.41% | ||||||||||||||
For the year ended December 31, 2005 | 0.05% | (g) | (g) | 275.31% | ||||||||||||||
For the year ended December 31, 2006 | 0.04% | (g) | (g) | 294.57% | ||||||||||||||
For the six months ended June 30, 2007 (Unaudited) | 0.17% | 0.85% | 0.17% | 131.02% | ||||||||||||||
Class IV Shares | ||||||||||||||||||
For the year ended December 31, 2003 (e) | 0.10% | (g) | (g) | 293.58% | ||||||||||||||
For the year ended December 31, 2004 | 0.27% | (g) | (g) | 282.41% | ||||||||||||||
For the year ended December 31, 2005 | 0.05% | (g) | (g) | 275.31% | ||||||||||||||
For the year ended December 31, 2006 | 0.05% | (g) | (g) | 294.57% | ||||||||||||||
For the six months ended June 30, 2007 (Unaudited) | 0.16% | 0.86% | 0.16% | 131.02% | ||||||||||||||
(a) | Not annualized for periods less than one year. | |
(b) | Annualized for periods less than one year. | |
(c) | During the period, certain fees were waived and/or reimbursed. If such waivers/reimbursements had not occurred, the ratios would have been as indicated. | |
(d) | Portfolio turnover is calculated on the basis of the Fund as a whole without distinguishing among the classes of shares. | |
(e) | For the period from April 28, 2003 (commencement of operations) through December 31, 2003. | |
(f) | The amount is less than $0.005 per share. | |
(g) | There were no fee reductions during the period. |
See accompanying notes to financial statements.
1. Organization
Nationwide Variable Insurance Trust (“NVIT” or the “Trust”) is an open-end management investment company, organized under the laws of Delaware by an amended and restated Agreement and Declaration of Trust, dated October 28, 2004, as amended to date. Prior to May 1, 2007, the Trust was named “Gartmore Variable Insurance Trust”. The Trust, originally created under the laws of Massachusetts as a Massachusetts business trust pursuant to a Declaration of Trust dated, as of June 30, 1981, and as subsequently amended, redomesticated as a Delaware Statutory Trust after the close of trading on April 29, 2005, and is registered under the Investment Company Act of 1940, as amended (the “1940 Act”). The redomestication was a change in statutory status and did not affect the operations of the Trust. As of June 30, 2007, the Trust had authorized an unlimited number of shares of beneficial interest, without par value (“shares”). The Trust currently offers shares to life insurance company separate accounts to fund the benefits under variable life insurance or annuity policies. To date, only the separate accounts of Nationwide Life Insurance Company and Nationwide Life and Annuity Insurance Company (collectively, “Nationwide”) have purchased shares of the Nationwide NVIT Growth Fund (the “Fund”), (formerly, “Gartmore GVIT Growth Fund”). The Trust currently operates forty (40) separate series, or mutual funds, each with its own investment objectives and strategies. This report contains the financial statements and financial highlights of the Fund.
2. Summary of Significant Accounting Policies
The following is a summary of significant accounting policies followed by the Fund in the preparation of its financial statements. The policies are in conformity with accounting principles generally accepted in the United States of America (“GAAP”). The preparation of financial statements requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of income and expenses for the period. Actual results could differ from those estimates.
(a) | Security Valuation |
Securities for which market quotations are readily available are valued at current market value as of “Valuation Time.” Valuation Time is as of the close of regular trading on the New York Stock Exchange (usually 4 p.m. Eastern time). Equity securities are valued at the last quoted sale price or, if there is no sale price, the last quoted bid price provided by an independent pricing service approved by the Trust’s Board of Trustees (“Board of Trustees”). Securities traded on NASDAQ are valued at the NASDAQ official closing price. Prices are taken from the primary market or exchange in which each security trades. | |
Most securities listed on a foreign exchange are valued either at fair value (see description below) or at the last sale price at the close of the exchange on which the security is principally traded. Foreign securities, currencies, and other assets and liabilities denominated in foreign currencies are translated into U.S. dollars at the exchange rate of said currencies against the U.S. dollar, as of Valuation Time, as provided by an independent pricing service approved by the Board of Trustees. | |
Debt (including defaulted issues) and other fixed income securities (other than short-term obligations) are valued at the last quoted bid price and/or by using a combination of daily quotes and matrix evaluations provided by an independent pricing service, the use of which has been approved by the Board of Trustees. Short-term debt securities, such as commercial paper and U.S. Treasury Bills having a remaining maturity of 60 days or less at the time of purchase, are considered to be “short-term” and are valued at amortized cost, which approximates market value. | |
Securities for which market quotations are not readily available, or for which an independent pricing service does not provide a value or provides a value that does not represent fair value in the judgment of the Fund’s investment adviser or designee, are valued at fair value under procedures approved by the Board of Trustees. The “Fair Value” of these securities is determined in good faith by taking into account relevant factors and surrounding circumstances. Methods utilized to obtain a “Fair Value” may include the following non-exclusive list of acceptable methods: (i) a multiple of earnings; (ii) the discount from market value of a similar, freely traded security; (iii) the yield-to-maturity |
for debt issues; or (iv) a consolidation of the methods. The Trust’s Valuation & Operations Committee considers a non-exclusive list of factors to arrive at the appropriate method of determining “Fair Value.” For example, fair value determinations are required for securities whose value is affected by a “significant” event that materially affects the value of a domestic or foreign security which occurs subsequent to the time of the close of the principal market on which such domestic or foreign security trades and before the Valuation Time (i.e., a “subsequent event”). Typically, this will involve events occurring after the close of a foreign market on which a security trades and before the next Valuation Time. | |
The Fund values foreign securities at fair value in the circumstances described below. Generally, trading in foreign securities markets is completed each day at various times prior to the Valuation Time. Due to the time differences between the closings of the relevant foreign securities exchanges and the Valuation Time for the Fund, the Fund will fair value its foreign investments when it is determined that the market quotations for the foreign investments either are not readily available or are unreliable and, therefore, do not represent fair value. When the fair value prices are utilized, these prices will attempt to reflect the impact of the U.S. financial markets’ perceptions and trading activities on the Fund’s foreign investments since the last closing prices of the foreign investments were calculated on their primary foreign securities markets or exchanges. For these purposes, the Board of Trustees has determined that movements in relevant indices or other appropriate market indicators, after the close of the foreign securities exchanges, may demonstrate that market quotations are unreliable, and may trigger fair value pricing for certain securities. Consequently, fair valuation of portfolio securities may occur on a daily basis. |
(b) | Repurchase Agreements |
The Fund may enter into repurchase agreements with an entity which is a member of the Federal Reserve System or which is a “primary dealer” (as designated by the Federal Reserve Bank of New York) in U.S. Government obligations. The repurchase price generally equals the price paid by the Fund plus interest negotiated on the basis of current short-term rates, which may be more or less than the rate on the underlying portfolio securities. The seller under a repurchase agreement is required to maintain the value of the collateral held pursuant to the agreement at a market value equal to or greater than the repurchase price (including accrued interest). Collateral subject to repurchase agreements is held by the Fund’s custodian or another qualified sub-custodian or in the Federal Reserve/ Treasury book-entry system. If the counterparty defaults and the fair value of the collateral declines, realization of the collateral by the Fund may be delayed or limited. The Fund may transfer uninvested cash balances into a pooled cash account. These balances are invested in one or more repurchase agreements, with the counterparty of Nomura Securities, which is fully collateralized by U.S. Government Agency Mortgages. |
(c) | Foreign Currency Transactions |
The accounting records of the Fund are maintained in U.S. dollars. Foreign currency amounts are translated into U.S. dollars at the current rate of exchange to determine the value of investments, assets and liabilities. The Fund may enter into foreign currency contracts in connection with purchases or sales of securities denominated in a foreign currency. Purchases and sales of securities, and income and expenses, are translated at the prevailing rate of exchange on the respective date of these transactions. The Fund does not isolate that portion of the results of operations resulting from changes in foreign exchange rates on investments from fluctuations arising from changes in market prices of securities held. These fluctuations are included with the net realized and unrealized gain or loss from investments and foreign currencies. |
(d) | Futures Contracts |
The Fund may invest in financial futures contracts (“futures contracts”) for the purpose of hedging its existing portfolio securities or securities that the Fund intends to purchase against fluctuations in value caused by changes in prevailing market interest rates or prices. Futures contracts may also be entered into for non-hedging purposes. | |
Upon entering into a futures contract, the Fund is required to pledge to the broker an amount of cash and/or other assets equal to a certain percentage of the contract amount (initial margin deposit). Subsequent payments, known as |
“variation margin,” are made each day, depending on the daily fluctuations in the fair value/market value of the underlying assets. A gain or loss equal to the daily variation margin is recognized on a daily basis. Futures contracts are valued daily at their last quoted sale price. | |
A “sale” of a futures contract means the creation of a contractual obligation to deliver the securities or foreign currency called for by the contract at a fixed price at a specified time in the future. A “purchase” of a futures contract means the creation of a contractual obligation to acquire the securities or foreign currency at a fixed price at a specified time in the future. | |
Should market conditions change unexpectedly, the Fund may not achieve the anticipated benefits of the futures contracts and may realize a loss. The use of futures transactions for hedging purposes involves the risk of imperfect correlation in movements in the price of futures contracts, interest rates, and the value of the underlying hedged assets. |
(e) | Written Options Contracts |
The Fund may write options contracts. A written option obligates the Fund to deliver (written call) or to receive (written put) a specified quantity of an underlying asset at the contract amount upon exercise by the holder of the option. When the Fund writes an option, an amount equal to the premium received by the Fund is recorded as a liability and is subsequently adjusted to the current fair value of the option written. Premiums received from writing options that expire unexercised are treated by the Fund on the expiration date as realized gains from investments. The difference between the premium and the amount paid on effecting a closing purchase transaction, as a realized loss. If a call option is exercised, the premium is added to the proceeds from the sale of the underlying security or currency in determining whether the Fund has realized a gain or loss. If a put option is exercised, the premium reduces the cost basis of the securities purchased by the Fund. Options traded on an exchange are valued at the last quoted sale price, or in the absence of a sale, the bid price provided by an independent pricing service approved by the Board of Trustees. Non-exchange traded options are valued using dealer supplied quotes. The Fund as a writer of an option bears the market risk of an unfavorable change in the price of the security underlying the written option. |
(f) | Short Sales |
The Fund is authorized to engage in short-selling of portfolio securities which obligates the Fund to replace any security that the Fund has borrowed by purchasing the security at current market value sometime in the future. The Fund will incur a loss if the price of the security increases between the date of the short sale and the date on which the Fund replaces the borrowed security. The Fund generally will realize a gain if the price of the security declines between these dates. Until the Fund replaces the borrowed security, the Fund will maintain a segregated account with cash, U.S. Government securities and/or securities held long to sufficiently cover the Fund’s short position on a daily basis. Dividends declared on securities sold short are recorded as an expense on the ex-dividend date and paid to the counterparty on the dividend pay date. |
(g) | Security Transactions and Investment Income |
Security transactions are accounted for on the date the security is purchased or sold (“trade date”). Securities gains and losses are calculated on the identified cost basis. Interest income is recognized on the accrual basis and includes, where applicable, the amortization or accretion of premium or discount. Dividend income is recorded on the ex-dividend date. |
(h) | Securities Lending |
To generate additional income, the Fund may lend its portfolio securities, up to 33 1/3% of the Fund, to brokers, dealers and other financial institutions provided that (1) the borrower delivers cash or securities as collateral with respect to each new loan of U.S. securities, equal to at least 102% of the value of the portfolio securities loaned, and with respect to each new loan on non-U.S. securities, collateral of at least 105% of the value of the portfolio |
securities loaned; and (2) at all times thereafter shall require the borrower to mark-to-market the collateral on a daily basis so that the market value of such collateral does not fall below 100% of the value of securities loaned. The Fund receives payments from borrowers equivalent to the dividends and interest that would have been earned on securities loaned while simultaneously seeking to earn income on the investment of cash collateral. There may be risks of delay in recovery of the securities should the borrower of the securities fail financially. Loans will be made, however, only to borrowers deemed by the Fund’s investment adviser to be of good standing and creditworthy under guidelines established by the Board of Trustees and when, in judgment of the adviser, the consideration which can be earned currently from these securities loans justifies the attendant risks. Loans are subject to termination by the Fund or the borrower at any time, and, therefore, are not considered to be illiquid investments. JPMorgan Chase Bank serves as custodian for the securities lending program of the Fund. JPMorgan Chase Bank receives a fee based on the value of the collateral received from borrowers. | |
Information on the investment of cash collateral is shown in the Statement of Investments. | |
As of June 30, 2007, the Fund had securities with the following value on loan: |
Value of | ||||||
Value of Loaned Securities | Collateral | |||||
$10,143,631 | $ | 10,369,713 | ||||
(i) | Distributions to Shareholders |
The Fund’s dividends from net investment income, if any, are declared and paid quarterly. The Fund’s distributions from net realized capital gains, if any, are declared and distributed at least annually. | |
Dividends and distributions to shareholders are determined in accordance with federal income tax regulations, which may differ from GAAP. These “book/tax” differences are considered either permanent or temporary in nature. In accordance with the American Institute of Certified Public Accountants Statement of Position 93-2, permanent differences (i.e., reclassification of market discounts, foreign exchange gain/loss, paydowns, and distributions from real estate investment trusts) are reclassified within the capital accounts based on their nature for federal income tax purposes; temporary differences do not require reclassification. These reclassifications have no effect upon the net asset value of the Fund. To the extent distributions exceed current and accumulated earnings and profits for federal income tax purposes, these distributions are reported as distributions of paid-in-capital. |
(j) | Federal Income Taxes |
It is the policy of the Fund to qualify or to continue to qualify as a “regulated investment company” by complying with the provisions available to certain investment companies, as defined in Subchapter M of the U.S. Internal Revenue Code, and to make distributions of net investment income and net realized capital gains sufficient to relieve the Fund from all, or substantially all, federal income taxes. | |
As of June 30, 2007, the tax cost of securities and the breakdown of unrealized appreciation (depreciation) for the Fund was as follows: |
Net Unrealized | ||||||||||||||||
Tax Cost of | Unrealized | Unrealized | Appreciation | |||||||||||||
Securities | Appreciation | Depreciation | (Depreciation) | |||||||||||||
$ | 22,037,347 | $ | 15,992,437 | $ | (1,960,089 | ) | $ | 14,032,348 | ||||||||
(k) | Allocation of Expenses, Income, and Gains and Losses |
Expenses directly attributable to the Fund are charged to the Fund. Expenses not directly attributable to the Fund are allocated proportionately among various or all funds within the Trust. The method used by the Fund for allocating income, fund level expenses, and realized and unrealized gains or losses is based on the fair value of shares |
outstanding relative to net assets. Under this method, each class of shares participates based on the total net asset value of that class’s shares in proportion to the total net assets of the Fund. Expenses specific to a class (such as Rule 12b-1 and administrative services fees) are charged to that class. |
3. Transactions with Affiliates
Under the terms of the Trust’s Investment Advisory Agreement, Nationwide Fund Advisors (formerly, Gartmore Mutual Fund Capital Trust (“GMF”)) (“NFA” or the “Advisor”) manages the investment of the assets and supervises the daily business affairs of the Fund. NFA is a wholly-owned subsidiary of Nationwide Financial Services (“NFS”).
Under the terms of the Investment Advisory Agreement, the Fund pays NFA an investment advisory fee based on the Fund’s average daily net assets and the following schedule:
Fee Schedule | Fees | |||||
Up to $250 million | 0.600% | |||||
On the next $750 million | 0.575% | |||||
On the next $1 billion | 0.550% | |||||
On the next $3 billion | 0.525% | |||||
On $5 billion or more | 0.500% | |||||
Under the terms of a Fund Administration and Transfer Agency Agreement, Nationwide Fund Management, LLC ((formerly, Gartmore Investor Services, Inc. (“GISI”))(“NFM”), a wholly-owned subsidiary of NFS Distributors, Inc. (“NFSDI”), provides the Fund with various administrative and accounting services for the Fund (prior to May 1, 2007, this service was provided by Gartmore SA Capital Trust (“GSA”)), and serves as Transfer and Dividend Disbursing Agent for the Fund (prior to May 1, 2007, this service was provided by GISI, an indirect subsidiary of GSA.) The fees for the services provided under this Agreement are calculated based on the Trust’s average daily net assets according to the fee schedule below. The fees are then allocated proportionately among all funds within the Trust in relation to the average daily net assets of each fund and are paid to NFA. NFA pays NFM from these fees for NFM’s services.
Combined Fee Schedule* | ||||||
Up to $1 billion | 0.15% | |||||
$1 billion up to $3 billion | 0.10% | |||||
$3 billion up to $8 billion | 0.05% | |||||
$8 billion up to $10 billion | 0.04% | |||||
$10 billion up to $12 billion | 0.02% | |||||
$12 billion or more | 0.01% | |||||
* | The assets of the Nationwide NVIT Investor Destinations Aggressive Fund, the Nationwide NVIT Investor Destinations Moderately Aggressive Fund, the Nationwide NVIT Investor Destinations Moderate Fund, the Nationwide NVIT Investor Destinations Moderately Conservative Fund, and the Nationwide NVIT Investor Destinations Conservative Fund (collectively, the “Investor Destinations Funds”) are excluded from the Trust asset level amount in order to calculate this asset-based fee. The Investor Destinations Funds do not pay any part of this fee. |
NFA and NFM have entered into agreements with Citi Fund Services Ohio, Inc. (“Citi”), pursuant to which Citi provides sub-administration and sub-transfer agency services, respectively, to the Fund. Effective August 1, 2007, The BISYS Group Inc. was acquired by and became a wholly owned subsidiary of Citi.
Under the terms of an Administrative Services Plan, the Fund may pay fees to servicing organizations, such as broker-dealers, NFS, and financial institutions, which agree to provide administrative support services to the shareholders of certain classes. These services include, but are not limited, to the following: establishing and maintaining shareholder accounts; processing purchase and redemption transactions; arranging bank wires; performing shareholder sub-accounting;
For the six months ended June 30, 2007, NFS received $155,589 in Administrative Services Fees from the Fund.
Under the terms of a letter agreement dated September 12, 2006, by and among NFA, the Audit Committee of the Trust and the Trust, the Trust has agreed to reimburse NFA certain costs related to the Fund’s portion of ongoing administration, monitoring and annual (audit) testing of the Trust’s Rule 38a-1 Compliance Program subject to the pre-approval of the Trust’s Audit Committee. For the six months ended June 30, 2007, the Fund’s portion of such costs amounted to $1,454.
4. Investment Transactions
For the six months ended June 30, 2007, (excluding short-term securities) the Fund had purchases of $271,477,820 and sales of $287,983,906.
5. Bank Loans and Earnings Credit
The Trust has a credit agreement with JPMorgan Chase & Co., the Fund’s custodian bank, permitting the Trust to borrow up to $100,000,000. Borrowings under this arrangement bear interest at the Federal Funds rate plus 0.50%. The interest costs, if any, would be included in other fees in the Statement of Operations. No compensating balances were required under the terms of the line of credit. The line of credit is renewed annually, expiring on June 25, 2008, with a commitment fee of 0.07% per year on $100,000,000. There were no borrowings outstanding under this line of credit for the six months ended June 30, 2007.
The Trust’s custodian bank has agreed to reduce the bank’s fees (earnings credit) when the funds of the Trust maintain cash on deposit in non-interest-bearing custody and Demand Deposit Accounts. Earnings credits, if any, are shown as a reduction of total expenses on the Statement of Operations.
6. Portfolio Investment Risks
Risks Associated with Foreign Securities and Currencies. Investments in securities of foreign issuers carry certain risks not ordinarily associated with investments in securities of U.S. issuers. These risks include future political and economic developments, and the possible imposition of exchange controls or other foreign governmental laws and restrictions. In addition, with respect to certain countries, there is the possibility of expropriation of assets, confiscatory taxation, political or social instability, or diplomatic developments, which could adversely affect investments in those countries.
Certain countries also may impose substantial restrictions on investments in their capital markets by foreign entities, including restrictions on investments in issuers of industries deemed sensitive to relevant national interests. These factors may limit the investment opportunities available and result in a lack of liquidity and high price volatility with respect to securities of issuers from developing countries.
7. Indemnifications
Under the Trust’s organizational documents, certain of the Trust’s Officers and Trustees are indemnified against certain liabilities arising out of the performance of their duties to the Trust. In addition, the Trust has entered into Indemnification Agreements with the Trust’s trustees and certain officers covering similar liabilities. Trust Officers receive no compensation from the Trust for serving as the Trust’s Officers. In addition, in the normal course of business, the Trust enters into contracts with its vendors and others that provide for general indemnifications. The Trust’s maximum exposure under these arrangements is unknown, as this would involve future claims that may be made against the Trust. Based on experience, however, the Trust expects that risk of loss to be remote.
8. Recently Issued Accounting Pronouncements
On July 13, 2006, the Financial Accounting Standards Board (“FASB”) released FASB Interpretation No. 48, Accounting for Uncertainty in Income Taxes (“FIN 48”). FIN 48 provides guidance for how uncertain tax positions should be recognized, measured, presented and disclosed in the financial statements. FIN 48 requires the affirmative evaluation of tax positions taken or expected to be taken in the course of preparing the Fund’s tax returns to determine whether it is more-likely-than-not (i.e., greater than 50 percent) that each tax position will be sustained upon examination by a taxing authority based on the technical merits of the position. A tax position that meets the more-likely-than-not recognition threshold is measured to determine the amount of benefit to recognize in the financial statements. Differences between tax positions taken in a tax return and amounts recognized in the financial statements will generally result in an increase in a liability for taxes payable (or a reduction of a tax refund receivable) and an increase in a deferred tax liability (or a reduction in a deferred tax asset). Adoption of FIN 48 was required no later than the last business day of the first financial statement reporting period for fiscal years beginning after December 15, 2006 and is to be applied to all open tax years as of the effective date. Accordingly, the Fund was required to implement FIN 48 in its net asset value per share (NAV) calculation on June 29, 2007. Management has evaluated the implications of FIN 48 and has concluded that there was no impact to the Fund’s financial statements as of June 29, 2007. The adoption of FIN 48 requires ongoing monitoring and analysis, future conclusions reached by management may be different and result in adjustments to the Fund’s NAV and financial statements.
In September 2006, the FASB issued Statement on Financial Accounting Standards (“SFAS”) No. 157, “Fair Value Measurements.” This standard establishes a single authoritative definition of fair value, sets out a framework for measuring fair value and requires additional disclosures about fair value measurements. SFAS No. 157 applies to fair value measurements already required or permitted by existing standards. SFAS No. 157 is effective for financial statements issued for fiscal years beginning after November 15, 2007 and interim periods within those fiscal years. The changes to current accounting principles generally accepted in the United States of America from the application of this Statement relate to the definition of fair value, the methods used to measure fair value, and the expanded disclosures about fair value measurements. As of June 30, 2007, the Fund does not believe the adoption of SFAS No. 157 will impact the financial statement amounts; however, additional disclosures may be required about the inputs used to develop the measurements and the effect of certain of the measurements on changes in net assets for the period.
Trustees who are not Interested Persons (as defined in the 1940 Act) and Officers of the Trust as of
Number of Portfolios | ||||||||||
Position(s) Held | in the | |||||||||
with the Trust | Principal Occupation(s) | Nationwide Fund | Other | |||||||
Name, Address | and Length of | During Past | Complex Overseen | Directorships | ||||||
and Year of Birth | Time Served1 | Five Years | by Trustee | Held by Trustee2 | ||||||
Charles E. Allen c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1948 | Trustee since July 2000 | Mr. Allen is Chairman, Chief Executive Officer and President of Graimark Realty Advisors, Inc. (real estate development, investment and asset management). | 89 | None | ||||||
Paula H.J. Cholmondeley c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1947 | Trustee since July 2000 | Ms. Cholmondeley was Vice President and General Manager of Sappi Fine Paper North America from April 2000 through December 2003. | 89 | Director of Dentsply International, Inc. (dental products), Ultralife Batteries, Inc., Terex Corporation (construction equipment), Minerals Technology, Inc. (specialty chemicals) and Albany International Corp. (paper industry) | ||||||
C. Brent DeVore3 c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1940 | Trustee since 1990 | Dr. DeVore is President of Otterbein College. | 89 | None | ||||||
Phyllis Kay Dryden c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1947 | Trustee since December 2004 | Ms. Dryden was a partner of Mitchell Madison, a management consulting company from January 2006 until December 2006; she is currently a consultant with the company. Ms. Dryden was formerly Managing Partner of march FIRST, a global management consulting firm. | 89 | None | ||||||
Barbara L. Hennigar c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1935 | Trustee since July 2000 | Retired. | 89 | None | ||||||
Number of Portfolios | ||||||||||
Position(s) Held | in the | |||||||||
with the Trust | Principal Occupation(s) | Nationwide Fund | Other | |||||||
Name, Address | and Length of | During Past | Complex Overseen | Directorships | ||||||
and Year of Birth | Time Served1 | Five Years | by Trustee | Held by Trustee2 | ||||||
Barbara I. Jacobs c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1950 | Trustee since December 2004 | Ms. Jacobs served as Chairman of the Board of Directors of KICAP Network Fund, a European (United Kingdom) hedge fund, from January 2001 through January 2006. From 1998-2003, Ms. Jacobs was also a Managing Director and European Portfolio Manager of CREF Investments (Teachers Insurance and Annuity Association-College Retirement Equities Fund). | 89 | None | ||||||
Douglas F. Kridler c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1955 | Trustee since September 1997 | Mr. Kridler has served as the President and Chief Executive Officer of the Columbus Foundation (a Columbus, OH-based foundation which manages over 1,300 individual endowment funds) since February 2002. Prior to January 31, 2002, Mr. Kridler was the President of the Columbus Association for the Performing Arts and Chairman of the Greater Columbus Convention and Visitors Bureau. | 89 | None | ||||||
Michael D. McCarthy c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1947 | Trustee since December 2004 | Retired. Mr. McCarthy was Chairman of VMAC (commodity swaps) from October 2002 until January 2007; and a partner of Pineville Properties LLC (a commercial real estate development firm) from September 2000 until January 2007. | 89 | None | ||||||
David C. Wetmore c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1948 | Trustee since 1995 and Chairman since February 2005 | Retired. | 89 | None | ||||||
1 | Length of time served includes time served with the Trust’s predecessors. | |
2 | Directorships held in (1) any other investment companies registered under the 1940 Act, (2) any company with a class of securities registered pursuant to Section 12 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or (3) any company subject to the requirements of Section 15(d) of the Exchange Act. | |
3 | Mr. DeVore has served as President of Otterbein College since 1984. Mark Thresher, President and Chief Operating Officer of Nationwide Financial Services, Inc. (“NFS”) has served as a member of the Board of Trustees of Otterbein College since 2000, currently serves as one of 30 of its trustees, and is currently one of two Vice Chairmen of the Board. Each of Nationwide Fund Advisors (“NFA”), the Funds’ investment adviser, and Nationwide Fund Distributors LLC (“NFD”), principal underwriter to the Trust, is a wholly-owned subsidiary of NFS. | |
Additional information regarding the Trustees and Officers may be found in the Trust’s Statement of Additional Information, which is available without charge upon request, by calling 800-848-0920. |
Trustees who are Interested Persons (as defined in the 1940 Act) and/or Officers of the Trust as of
Number of Portfolios | ||||||||||
Position(s) Held | in the | |||||||||
with the Trust | Principal Occupation(s) | Nationwide Fund | Other | |||||||
Name, Address | and Length of | During Past | Complex Overseen | Directorships | ||||||
and Year of Birth | Time Served1 | 5 Years | by Trustee | Held by Trustee 2 | ||||||
Arden L. Shisler c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1941 | Trustee since February 2000 | Retired. Mr. Shisler is the former President and Chief Executive Officer of KeB Transport, Inc., a trucking firm (2000 through 2002). He served as a consultant to KeB from January 2003 through December 2004. Since 1992, Mr. Shisler has also been Chairman of the Board for Nationwide Mutual Insurance Company.3 | 89 | Director of Nationwide Financial Services, Inc., Chairman of Nationwide Mutual Insurance Company3 | ||||||
John H. Grady Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1961 | President & Chief Executive Officer since December 2006 | Mr. Grady is President, and Chief Executive Officer of Nationwide Funds Group which includes Nationwide Fund Advisors,3 Nationwide Fund Management LLC,3 Nationwide Fund Distributors LLC 3 and NWD Investments,2 the asset management operations of Nationwide Mutual Insurance Company, which includes Morley Capital Management, Inc.,2 Nationwide Separate Accounts LLC,2 NorthPointe Capital LLC,2 and Nationwide SA Capital Trust2. From March 2004 until March 2006, Mr. Grady was Chief Executive Officer of Constellation Investment Management Co., L.P. (registered investment adviser), and President and Chief Executive Officer of Constellation Funds Group (registered investment companies). He also was President of Constellation Investment Distribution Co., Inc. (registered broker-dealer) from March 2004 until June 2006. From February 2001 until February 2004, Mr. Grady was Chief Operating and Chief Legal Officer; Managing Director, Mutual Funds Group, Turner Investment Partners, Inc. (registered investment adviser); Executive Vice President of Turner Funds and Turner Institutional Portfolios (registered investment companies); and President, Turner Investment Distributors, Inc. (registered broker-dealer). | N/A | None | ||||||
Gerald J. Holland Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1951 | Treasurer since March 2001 | Mr. Holland is Senior Vice President—Operations for Nationwide Funds Group3. | N/A | N/A | ||||||
Number of Portfolios | ||||||||||
Position(s) Held | in the | |||||||||
with the Trust | Principal Occupation(s) | Nationwide Fund | Other | |||||||
Name, Address | and Length of | During Past | Complex Overseen | Directorships | ||||||
and Year of Birth | Time Served1 | 5 Years | by Trustee | Held by Trustee 2 | ||||||
Michael A. Krulikowski Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1959 | Chief Compliance Officer from June 2004 to August 20074 | Mr. Krulikowski is Vice President and Chief Compliance Officer of Nationwide Funds Group3, Morley Capital Management, Inc.3, Nationwide SA Capital Trust (since 1999)3, and Nationwide Separate Accounts LLC (since August 2005).3 Since June 2004, Mr. Krulikowski has also served as Chief Compliance Officer of the Trust. From November 1999 through May 2007, he served as Vice President and Chief Compliance Officer of NorthPointe Capital LLC. 3 | N/A | N/A | ||||||
Eric E. Miller Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1953 | Secretary since December 2002 | Mr. Miller is Senior Vice President, General Counsel, and Assistant Secretary for Nationwide Funds Group3 and NWD Investments.2 From August 2000 to August 2002, Mr. Miller was a Partner with Stradley Ronon Stevens & Young, LLP. | N/A | N/A | ||||||
1 | Length of time served includes time served with the Trust’s predecessors. | |
2 | Directorships held in (1) any other investment companies registered under the 1940 Act, (2) any company with a class of securities registered pursuant to Section 12 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or (3) any company subject to the requirements of Section 15(d) of the Exchange Act. | |
3 | This position is held with an affiliated person or principal underwriter of the Trust. | |
4 | Effective August 3, 2007, the Board of Trustees approved Carol Baldwin Moody as Chief Compliance Officer of the Trust. Since November 2005, Ms. Moody has been Senior Vice President, Chief Compliance Officer of Nationwide Financial Services, Nationwide Life Insurance Company, Nationwide Life and Annuity Insurance Company, and Nationwide Investment Advisors, LLC. From February 2004-November 2005, she was Chief Compliance Officer of TIAA-CREF and from April 2000-February 2004, she was Managing Director and General Counsel, TCW/ Latin America Partners, LLC and Baeza & Co., LLC. | |
Federal law requires the Trust, each of its investment advisers and sub-advisers to adopt procedures for voting proxies (“Proxy Voting Guidelines”) and to provide a summary of those Proxy Voting Guidelines used to vote the securities held by the Funds. The Funds’ proxy voting policies and procedures are available without charge (i) upon request, by calling 800-848-0920, (ii) on the Funds’ website at www.nationwidefunds.com, or (iii) on the Securities and Exchange Commission’s website at www.sec.gov. |
A. Renewal of Investment Advisory Agreement
(i) General Information Regarding the Board’s Review of Investment Advisory Agreements
The Trust’s investment advisory agreements (each an “Advisory Agreement”) with its investment adviser and, as applicable, sub-advisers (together, the “Adviser”) must be approved for an initial term no greater than two years, and renewed at least annually thereafter, (i) by the vote of the Trustees or by a vote of the shareholders of each series or fund of the Trust (individually a “Fund” ), and (ii) by the vote of a majority of the Trustees who are not parties to the Advisory Agreement or “interested persons” of any party thereto (the “Independent Trustees”) cast in person at a meeting called for the purpose of voting on such approval.
The Board meets quarterly and takes into account throughout the year matters bearing on each Fund’s Advisory Agreement. The Board and its standing committees consider at each meeting factors that are relevant to the annual renewal of an Advisory Agreement, including the services and support provided to a Fund and its shareholders.
On December 6, 2006, the Independent Trustees first met in person with their independent legal counsel (“Independent Legal Counsel”) to consider information provided by the Adviser and others to assist the Trustees in considering whether to renew each Fund’s Advisory Agreement for a one year term beginning May 1, 2007. Immediately following such meeting of the Independent Trustees, all Trustees met in person with the Adviser, Trust counsel, Independent Legal Counsel and others to consider such matters, and give preliminary consideration to information bearing on continuation of each Advisory Agreement. The primary purpose of the December 6 and 7, 2006 meeting was to ensure that the Trustees had ample opportunity to consider matters they deemed relevant in considering the continuation of an Advisory Agreement, and to request any additional information they considered reasonably necessary to their deliberations.
In preparation for the December 6 and 7, 2006 meeting the Trustees were provided, at the request of the Trustees, with a wide range of information to assist in their deliberations, including (i) reports from Lipper Inc. describing a Fund’s (a) performance rankings (where “first quintile” denotes the best performance) (over multiple years ended September 30, 2006) compared with performance groups and performance universes created by Lipper (and in some cases, customized peer groups created by the Adviser) of similar or peer group funds, and (b) expense rankings (where “first quintile” denotes the lowest fees and expenses) comparing the Fund’s contractual advisory fee and total expenses with expense groups and expense universes created by Lipper of similar or peer group funds, (ii) information from the Adviser describing the Fund’s performance (over multiple years ended September 30, 2006) compared with its benchmark and Lipper categories, (iii) for Funds under “close review,” copies of letters from the Adviser to the portfolio manager of each such Fund, together with the portfolio manager’s written response describing the reasons for the Fund’s underperformance (iv) information from the Adviser describing performance for the months of October and November, 2006, and annual performance for the year ended November 30, 2006, (v) reports from the Adviser describing the Adviser’s profitability in providing services under an Advisory Agreement, together with an explanation of Adviser’s methodology in calculating its profitability, (vi) information from the Adviser describing any fees paid to the Adviser for managing similar, non-affiliated institutional accounts, including the range of fee levels for such accounts, and (vii) information from the Adviser describing ancillary benefits, in addition to fees for serving as investment adviser, derived by the Adviser as a result of being investment adviser for a Fund, including, where applicable, information on soft-dollar benefits and fees inuring to the Adviser’s affiliates for serving as the Trust’s administrator, fund accountant and transfer agent.
At the December 6 and 7, 2006 meeting, the Trustees reviewed, considered and discussed, among themselves and with the Adviser, Trust counsel and Independent Legal Counsel, among other things, the information described above, and: (i) the nature, extent and quality of services provided by the Adviser under each Advisory Agreement, (ii) the investment performance of each Fund and the Adviser, (iii) the costs of the services provided by the Adviser under the Advisory Agreement and the profits realized by the Adviser thereunder, (iv) the extent to which economies of scale may be present and, if so, whether they are being shared with a Fund’s shareholders, (v) comparisons of the Adviser’s fees under the Advisory Agreement with investment advisory fees paid by peer group funds to their investment advisers and paid by non-affiliated institutional clients to the Adviser for managing similar accounts, and (vi) any ancillary benefits inuring to the Adviser and its affiliates as a result of being investment adviser for the Trust. The Trustees also considered, where
As part of the December 6 and 7, 2006 Board meeting, the Independent Trustees developed a list of follow-up matters and questions and asked that Adviser respond to such matters and questions at the contract approval meeting of the Board of Trustees to be held on January 11, 2007.
At the January 11, 2007 meeting of the Board of Trustees of the Trust, the Board received and considered information provided by the Adviser in follow-up from the December 6 and 7, 2006 Board meeting and, after consulting among themselves, and with the Adviser, Trust counsel and Independent Legal Counsel, concluded unanimously to renew the Advisory Agreement for the reasons set forth in the following section. In determining whether to renew the Advisory Agreement for the Fund, the Board ultimately reached a determination, with the assistance of Trust counsel and Independent Legal Counsel, that the renewal of the Advisory Agreement and the compensation to be received by the Adviser under the Advisory Agreement is consistent with the Board’s fiduciary duty under applicable law.
(ii) Board Conclusions Regarding the Fund’s Advisory Agreement
The Board considered that the Fund had underperformed its benchmark, the Russell 1000 Growth Index, for the one-year period, while outperforming the benchmark for the three- and five-year periods. The Board also considered that the performance of the Fund’s Class I shares ranked in the fourth quintile of its Lipper-constructed Performance Group over the one- and two-year periods, the second quintile over the three-year period, and the first quintile over the four- and five-year periods. Although the Fund’s performance over the more recent one-year period ended November 2006 ranked the Fund in the third quintile, the Board considered that: (i) longer-term relative performance has been good; (ii) the Fund’s adviser has represented that it will be adding a quantitative core sleeve to the Fund; and (iii) the Fund’s adviser has committed to allocating additional resources to management of the Fund. Based on its review, and giving particular weight to the nature and quality of the resources dedicated by the adviser to improve relative performance, and based on the factors described above, the Board concluded that the nature, extent and quality of services provided to the Fund will benefit the Fund’s shareholders.
The Board also considered that the Fund’s contractual advisory fee and breakpoints placed the Fund in the second quintile of its Lipper-constructed Expense Group and the Fund’s total expenses placed it in the first quintile. The Board concluded the Fund’s management fee and total expenses were fair and reasonable in light of the services the Fund receives and the other factors considered.
The Board considered that the Fund’s adviser reported a pre-tax profit margin for investment management services for during the twelve month-periods ended September 30, 2006 and 2005. The Board also considered the costs of the services provided and the amounts of the profits realized by the adviser and determined the amount of profit is a fair entrepreneurial profit for management of the Fund.
Based upon its evaluation of all of the conclusions noted above, and after considering all material factors with respect to the Fund, the Board ultimately concluded that the advisory fee structure is fair and reasonable, and that the Advisory Agreement (and, if applicable, Sub-Advisory Agreement) with respect to the Fund, should be renewed.
B. Approval of New Advisory Agreement
At its January 11, 2007 meeting, the Board also unanimously approved a new investment advisory agreement (the “New Agreement”) for the Fund with Nationwide Fund Advisors, (“NFA”) the then-current adviser to each of the series of the Trust to become effective upon the closing of the acquisition of NFA by Nationwide Financial Services, Inc. (“NFS”) from Nationwide Corporation (“NWC”) which closed on April 30, 2007 (the “Transaction”). In approving the New Agreement, the Board considered NFA’s capacity to continue to provide the services needed to operate a sophisticated investment management business and to support the management of each of the series. The Board also took into account
C. Submission of Matters to a Vote of Security Holders:
On April 25, 2007, a Special Meeting of Shareholders was held* (the “April 25 Meeting”) at which shareholders of the Funds** set forth below were asked:
Proposal 1:
To approve a new investment advisory agreement, on behalf of their Fund, between Nationwide Fund Advisors (formerly “Gartmore Mutual Fund Capital Trust”) (the “Adviser”) and Nationwide Variable Insurance Trust (formerly “Gartmore Variable Insurance Trust”) (the “Trust”).
Number of Shares | ||||||
Fund | Cast/Not Cast | Percentages | ||||
Federated NVIT High Income Bond Fund (Formerly Federated GVIT High Income Bond Fund) | FOR AGAINST ABSTAIN TOTAL | 30,051,703.188 shares 618,245.021 shares 1,813,550.431 shares 32,483,498.640 shares | 92.514% 1.903% 5.583% | |||
NVIT International Index Fund (Formerly GVIT International Index Fund) | FOR AGAINST ABSTAIN TOTAL | 4,322,203.982 shares 2,758.318 shares 135,636.840 shares 4,460,599.140 shares | 96.897% 0.062% 3.041% | |||
NVIT International Value Fund (Formerly GVIT International Value Fund) | FOR AGAINST ABSTAIN TOTAL | 20,032,843.199 shares 333,588.902 shares 1,093,293.879 shares 21,459,725.980 shares | 93.351% 1.554% 5.095% | |||
NVIT Mid Cap Index Fund (Formerly GVIT Mid Cap Index Fund) | FOR AGAINST ABSTAIN TOTAL | 35,380,179.120 shares 631,117.844 shares 1,565,714.306 shares 37,577,011.270 shares | 94.154% 1.679% 4.167% |
Number of Shares | ||||||
Fund | Cast/Not Cast | Percentages | ||||
NVIT S&P 500 Index Fund (Formerly GVIT S&P 500 Index Fund) | FOR AGAINST ABSTAIN TOTAL | 56,119,814.230 shares 666,195.542 shares 1,944,898.888 shares 58,730,908.660 shares | 95.554% 1.134% 3.312% | |||
Nationwide Multi-Manager NVIT Small Cap Growth Fund (Formerly GVIT Small Cap Growth Fund) | FOR AGAINST ABSTAIN TOTAL | 7,632,918.513 shares 149,458.111 shares 451,583.036 shares 8,233,959.660 shares | 92.700% 1.816% 5.484% | |||
Nationwide Multi-Manager NVIT Small Cap Value Fund (Formerly GVIT Small Cap Value Fund) | FOR AGAINST ABSTAIN TOTAL | 48,649,396.525 shares 979,183.753 shares 2,786,133.102 shares 52,414,713.380 shares | 92.816% 1.868% 5.316% | |||
Nationwide Multi-Manager NVIT Small Company Fund (Formerly GVIT Small Company Fund) | FOR AGAINST ABSTAIN TOTAL | 29,903,181.700 shares 838,774.923 shares 2,006,741.307 shares 32,748,697.930 shares | 91.311% 2.561% 6.128% | |||
Gartmore NVIT Developing Markets Fund (Formerly Gartmore GVIT Developing Markets Fund) | FOR AGAINST ABSTAIN TOTAL | 21,0177,889.443 shares 424,272.958 shares 1,543,850.729 shares 23,046,013.130 shares | 91.460% 1.841% 6.699% | |||
Gartmore NVIT Emerging Markets Fund (Formerly Gartmore GVIT Emerging Markets Fund) | FOR AGAINST ABSTAIN TOTAL | 17,050,534.593 shares 526,574.722 shares 881,608.905 shares 18,458,718.220 shares | 92.371% 2.853% 4.776% | |||
Nationwide NVIT Global Financial Services Fund (Formerly Gartmore GVIT Global Financial Services Fund) | FOR AGAINST ABSTAIN TOTAL | 1,554,847.333 shares 19,539.033 shares 52,206.494 shares 1,626,592.860 shares | 95.589% 1.201% 3.210% | |||
Nationwide NVIT Global Health Sciences Fund (Formerly Gartmore GVIT Global Health Sciences Fund) | FOR AGAINST ABSTAIN TOTAL | 4,722,963.678 shares 157,979.030 shares 207,642.222 shares 5,088,584.930 shares | 92.815% 3.104% 4.081% | |||
Nationwide NVIT Global Technology and Communications Fund (Formerly Gartmore GVIT Global Technology and Communications Fund) | FOR AGAINST ABSTAIN TOTAL | 8,585,472.039 shares 102,267.977 shares 489,577.634 shares 9,177,317.650 shares | 93.551% 1.114% 5.335% | |||
Gartmore NVIT Global Utilities Fund (Formerly Gartmore GVIT Global Utilities Fund) | FOR AGAINST ABSTAIN TOTAL | 4,123,270.549 shares 122,001.533 shares 240,276.088 shares 4,485,548.170 shares | 91.923% 2.720% 5.357% | |||
Nationwide NVIT Government Bond Fund (Formerly Gartmore GVIT Government Bond Fund) | FOR AGAINST ABSTAIN TOTAL | 88,471,567.462 shares 1,825,645.181 shares 5,841,990.727 shares 96,139,203.370 shares | 92.024% 1.899% 6.077% |
Number of Shares | ||||||
Fund | Cast/Not Cast | Percentages | ||||
Nationwide NVIT Growth Fund (Formerly Gartmore GVIT Growth Fund) | FOR AGAINST ABSTAIN TOTAL | 14,931,435.904 shares 409,826.402 shares 1,259,945.064 shares 16,601,207.370 shares | 89.942% 2.469% 7.589% | |||
Gartmore NVIT International Growth Fund (Formerly Gartmore GVIT International Growth Fund) | FOR AGAINST ABSTAIN TOTAL | 6,251,419.070 shares 139,618.548 shares 290,025.592 shares 6,681,063.210 shares | 93.569% 2.090% 4.341% | |||
Nationwide NVIT Investor Destinations Aggressive Fund (Formerly Gartmore GVIT Investor Destinations Aggressive Fund) | FOR AGAINST ABSTAIN TOTAL | 49,489,224.549 shares 1,385,396.474 shares 3,696,272.337 shares 54,570,893.360 shares | 90.688% 2.539% 6.773% | |||
Nationwide NVIT Investor Destinations Conservative Fund (Formerly Gartmore GVIT Investor Destinations Conservative Fund) | FOR AGAINST ABSTAIN TOTAL | 23,091,965.887 shares 314,935,884 shares 2,292,355.179 shares 25,699,256.950 shares | 89.855% 1.225% 8.920% | |||
Nationwide NVIT Investor Destinations Moderate Fund (Formerly Gartmore GVIT Investor Destinations Moderate Fund) | FOR AGAINST ABSTAIN TOTAL | 188,902,093.059 shares 3,018,924.590 shares 16,359,690.401 shares 208,280,708.050 shares | 90.696% 1.449% 7.855% | |||
Nationwide NVIT Investor Destinations Moderately Aggressive Fund (Formerly Gartmore GVIT Investor Destinations Moderately Aggressive Fund) | FOR AGAINST ABSTAIN TOTAL | 134,792,622.920 shares 3,489,207.264 shares 9,304,197.656 shares 147,586,027.840 shares | 91.332% 2.364% 6.304% | |||
Nationwide NVIT Investor Destinations Moderately Conservative Fund (Formerly Gartmore GVIT Investor Destinations Moderately Conservative Fund) | FOR AGAINST ABSTAIN TOTAL | 49,627,123.216 shares 856,088.634 shares 3,507,215.650 shares 53,990,427.500 shares | 91.918% 1.586% 6.496% | |||
Nationwide NVIT Mid Cap Growth Fund (Formerly Gartmore GVIT Mid Cap Growth Fund) | FOR AGAINST ABSTAIN TOTAL | 10,879,584.971 shares 352,594.958 shares 717,792.971 shares 11,949,972.900 shares | 91.043% 2.950% 6.007% | |||
Nationwide NVIT Money Market Fund II (Formerly Gartmore GVIT Money Market Fund II) | FOR AGAINST ABSTAIN TOTAL | 221,774,863.241 shares 12,322,482.494 shares 16,471,740.875 shares 250,569,086.610 shares | 88.508% 4.918% 6.574% | |||
Nationwide NVIT Money Market Fund (Formerly Gartmore GVIT Money Market Fund) | FOR AGAINST ABSTAIN TOTAL | 1,578,331,008.328 shares 32,372,133.671 shares 112,652,123.301 shares 1,723,355,265.300 shares | 91.585% 1.878% 6.537% | |||
NVIT Nationwide Fund (Formerly Gartmore GVIT NationwideFund) | FOR AGAINST ABSTAIN TOTAL | 125,423,274.735 shares 2,767,979.467 shares 8,762,255.828 shares 136,953,510.030 shares | 91.581% 2.021% 6.398% |
Number of Shares | ||||||
Fund | Cast/Not Cast | Percentages | ||||
NVIT Nationwide Leaders Fund (Formerly Gartmore GVIT Nationwide Leaders Fund) | FOR AGAINST ABSTAIN TOTAL | 2,298,504.956 shares 29,630.469 shares 71,637.755 shares 2,399,773.180 shares | 95.780% 1.235% 2.985% | |||
Nationwide NVIT U.S. Growth Leaders Fund (Formerly Gartmore GVIT U.S. Growth Leaders Fund) | FOR AGAINST ABSTAIN TOTAL | 4,972,094.773 shares 122,623.161 shares 174,625.606 shares 5,269,343.540 shares | 94.359% 2.327% 3.314% | |||
Gartmore NVIT Worldwide Leaders Fund (Formerly Gartmore GVIT Worldwide Leaders Fund) | FOR AGAINST ABSTAIN TOTAL | 2,666,862.487 shares 47,702.491 shares 118,719.882 shares 2,833,284.860 shares | 94.126% 1.684% 4.190% | |||
J.P. Morgan NVIT Balanced Fund (Formerly J.P. Morgan GVIT Balanced Fund) | FOR AGAINST ABSTAIN TOTAL | 15,966,867.546 shares 259,004.324 shares 1,339,385.200 shares 17,565,257.070 shares | 90.900% 1.475% 7.625% | |||
Van Kampen NVIT Comstock Value Fund (Formerly Van Kampen GVIT Comstock Value Fund) | FOR AGAINST ABSTAIN TOTAL | 27,737,008.009 shares 502,564.164 shares 1,824,670.107 shares 30,064,242.280 shares | 92.259% 1.672% 6.069% | |||
Van Kampen NVIT Multi Sector Bond Fund (Formerly Van Kampen GVIT Multi Sector Bond Fund) | FOR AGAINST ABSTAIN TOTAL | 21,253,297.665 shares 484,100.920 shares 1,803,963.645 shares 23,541,362.230 shares | 90.281% 2.056% 7.663% | |||
At the April 25 Meeting, shareholders of the Nationwide NVIT Mid Cap Growth Fund were also asked to approve a new investment subadvisory agreement among the Adviser, the Trust and NorthPointe Capital LLC. The voting results with respect to that proposal are set forth below:
Proposal 2
Number of Shares | ||||||
Fund | Cast/Not Cast | Percentages | ||||
Nationwide NVIT Mid Cap Growth Fund (Formerly Gartmore GVIT Mid Cap Growth Fund) | FOR AGAINST ABSTAIN TOTAL | 10,862,827.499 shares 414,574.660 shares 672,570.741 shares 11,949,972.900 shares | 90.903% 3.469% 5.628% | |||
* | This meeting was previously adjourned on April 23, 2007. | |
** | Fund names were changed effective May 1, 2007 to reflect “Nationwide”/ “NVIT” branding to coincide with the sale of Nationwide Fund Advisors, Inc. by Nationwide Corporation to its majority-owned subsidiary, Nationwide Financial Services, Inc. |
June 30, 2007 (Unaudited)
Contents | ||
6 | Statement of Investments | |
10 | Statement of Assets and Liabilities | |
11 | Statement of Operations | |
12 | Statements of Changes in Net Assets | |
14 | Financial Highlights | |
15 | Notes to Financial Statements |
Statement Regarding Availability of Proxy Voting Record.
SAR-MMKT (8/07) | ![]() |
Dear Fellow Shareholder:
Since I last wrote to you, our mutual funds have enjoyed another period of solid performance, and the corporate realignment that was in progress is now finished.
On May 1, 2007, Nationwide Financial Services, Inc. (NFS), completed its acquisition of the Philadelphia-based retail mutual fund operations of NWD Investment Management, Inc. (formerly, “Gartmore Global Investments, Inc.”), from Nationwide Corporation, a subsidiary of Nationwide Mutual Insurance Company. Effective that date, the acquired entities were renamed Nationwide Funds Group (NFG), and the Gartmore Funds were renamed the Nationwide Funds to better align with the Nationwide® brand. Although the corporate ownership and fund names have changed, I can assure you that NFG intends to maintain as much continuity as possible with the Funds and key personnel.
Thank you, shareholders, for approving the new investment advisory agreement that was required due to the change in corporate ownership. The new agreement is identical in all material respects to the original agreement that it replaces, with the exception of the section pertaining to the vote by the shareholders of the NVIT Mid Cap Growth Fund to approve NorthPointe Capital®, LLC (NorthPointe) as sub-adviser to that particular Fund.
Market Overview: January 1-June 30, 2007
Share prices in general were buoyed in part by better-than-expected first-quarter 2007 earnings and a flurry of mergers and acquisitions, many of these spurred by readily available funding from private equity firms. In June, investors grew more cautious amid surging crude oil prices, a sudden spike in long-term interest rates, and the meltdown of two hedge funds that had exposure to the subprime mortgage market. Looking abroad, a weak U.S. dollar aided foreign stocks, as reflected in the 11.09% advance of the Morgan Stanley Capital International Europe, Australasia and Far East (MSCI EAFE®) Index. Emerging market performance was particularly robust.
The bond market struggled during the first half of 2007. While short-term interest rates remained stable, reflecting the Federal Reserve Board’s decision in June to leave the target federal funds rate at 5.25%, longer-term rates climbed during the first half of 2007, depressing bond prices and forcing the Lehman Brothers® U.S. Aggregate Index to settle for a modest 0.97% return.
We at NFG thank you for your understanding and cooperation throughout our recent transition period. We emerge from this period energized for the future, and we look forward to serving your investment needs for a long time to come.
Nationwide Funds Group
PAST PERFORMANCE IS NO GUARANTEE OF FUTURE RESULTS.
Nationwide Funds are advised by Nationwide Fund Advisors (NFA). NFA is a wholly-owned subsidiary of Nationwide Financial Services. Nationwide Financial Services is a wholly-owned subsidiary of Nationwide Corporation. All of the common stock of Nationwide Corporation is held by Nationwide Mutual (95.2%) and Nationwide Mutual Fire Insurance Company (4.8%), each of which is a mutual company owned by its policyholders.
Nationwide Funds Group (NFG) is the mutual fund arm of Nationwide Financial Services (NYSE: NFS). Based in Conshohocken, Pa., a suburb of Philadelphia, NFG is comprised of Nationwide Fund Advisors, Nationwide Fund Distributors, LLC, and Nationwide Fund Management, LLC. Together, these provide advisory, distribution, and administration services respectively to the Nationwide Funds, and manage more than $43.5 billion in assets as of June 30, 2007, of which more than $12 billion are in “fund of funds” designed to provide asset allocation across several types of investments and asset classes.
Lehman Brothers (LB) U.S. Aggregate Index: An unmanaged, market value-weighted index of investment-grade, fixed-rate debt issues (including government, corporate, asset-backed, and mortgage-backed securities with maturities of one year or more) that is generally representative of the bond market as a whole.
Morgan Stanley Capital International Europe, Australasia and Far East (MSCI EAFE®) Index: An unmanaged, free float-adjusted, market capitalization-weighted index that is designed to measure the performance of stocks in developed markets outside the United States and Canada.
Standard & Poor’s 500® (S&P 500) Index: An unmanaged, market capitalization-weighted index of 500 widely held stocks of large-cap U.S. companies that gives a broad look at how the stock prices of those companies have performed.
Views expressed within are those of Nationwide Funds Group as of the date noted, are subject to change at any time, and may not come to pass.
This report is for informational purposes only, and is not intended as an offer or recommendation with respect to the purchase or sale of any security, option, future, or other derivatives in such securities.
Investing in mutual funds involves risk, including possible loss of principal.
Investors should carefully consider a fund’s investment objectives, risks, fees, charges, and expenses before investing any money. To obtain this and other fund information, please call 800-848-0920 to request a prospectus, or download a prospectus at www.nationwidefunds.com. Please read the prospectus carefully before investing any money.
Nationwide Funds distributed by Nationwide Fund Distributors LLC (formerly Gartmore Distribution Services, Inc.), Member NASD. 1200 River Road, Suite 1000, Conshohocken, Pa. 19428.
As a shareholder of the Fund, you incur two types of costs: (1) transaction costs, including sales charges (loads) paid on purchase payments and redemption fees; and (2) ongoing costs, including investment advisory fees, administration fees, distribution fees and other Fund expenses. The examples below are 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. Per SEC requirements, the examples assume that you had a $1,000 investment in the Class at the beginning of the reporting period, January 1, 2007, and continued to hold your shares at the end of the reporting period, June 30, 2007.
Actual Expenses
Hypothetical Example for Comparison Purposes
Please note that the expenses shown in the table are meant to highlight your ongoing costs only and do not reflect any transaction costs, such as sales charges (loads) or redemption fees. Therefore, the second line for each Class in 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 transaction costs were included, your costs would have been higher. The examples also assume all dividends and distributions have been reinvested.
Schedule of Shareholder Expenses
Nationwide NVIT Money Market Fund | ||||||||||||||||||||||
Beginning | Ending | Expenses Paid | Annualized | |||||||||||||||||||
Account Value, | Account | During Period* | Expense Ratio* | |||||||||||||||||||
January 1, 2007 | Value, | |||||||||||||||||||||
June 30, 2007 | ||||||||||||||||||||||
Class I | Actual | $ | 1,000.00 | $ | 1,023.80 | $ | 3.11 | 0.62% | ||||||||||||||
Hypothetical | 1 | $ | 1,000.00 | $ | 1,021.73 | $ | 3.11 | 0.62% | ||||||||||||||
Class IV | Actual | $ | 1,000.00 | $ | 1,024.40 | $ | 2.51 | 0.50% | ||||||||||||||
Hypothetical | 1 | $ | 1,000.00 | $ | 1,022.32 | $ | 2.51 | 0.50% | ||||||||||||||
Class V | Actual | $ | 1,000.00 | $ | 1,024.20 | $ | 2.71 | 0.54% | ||||||||||||||
Hypothetical | 1 | $ | 1,000.00 | $ | 1,022.12 | $ | 2.71 | 0.54% | ||||||||||||||
Class ID | Actual | $ | 1,000.00 | $ | 1,024.60 | $ | 2.36 | 0.47% | ||||||||||||||
Hypothetical | 1 | $ | 1,000.00 | $ | 1,022.47 | $ | 2.36 | 0.47% | ||||||||||||||
* | Expenses are equal to the Fund’s annualized expense ratio multiplied by the average account value over the period multiplied by 181/365 (to reflect the one-half year period). The expense ratio presented represents a six-month, annualized ratio in accordance with SEC guidelines. The expenses reported above do not include the effect of additional expenses imposed by variable annuity contracts. | |
1 | Represents the hypothetical 5% return before expenses. |
Asset Allocation | ||||
Asset-Backed Commercial Paper | 36.4% | |||
Commercial Paper | 25.6% | |||
Floating Rate Notes | 19.3% | |||
Certificates of Deposit | 8.1% | |||
Corporate Bonds | 6.3% | |||
Municipal Bonds | 3.6% | |||
Other Assets | 0.7% | |||
100.0% |
Top Holdings | ||||
Georgetown Funding Co., 5.42%, 07/25/07 | 3.0% | |||
Nationwide Building Society, 5.27%, 07/10/07 | 2.5% | |||
Cargill Asia Pacific, 5.47%, 07/06/07 | 2.5% | |||
Golden Funding Corp., 5.46%, 07/16/07 | 2.5% | |||
Florida Hurricane Catastrophe, 5.33%, 07/14/08 | 2.0% | |||
Three Rivers Funding Corp., 5.36%, 07/12/07 | 2.0% | |||
Sandlot Funding LLC, 5.42%, 07/23/07 | 2.0% | |||
Yorkshire Building Society, 5.27%, 08/15/07 | 1.9% | |||
Natixis, 5.40%, 01/22/08 | 1.7% | |||
Westpac Capital Corp., 5.28%, 07/12/07 | 1.6% | |||
South Carolina Public Service Authority, 5.35%, 08/23/07 | 1.6% | |||
Other | 76.7% | |||
100.0% |
Top Industries | ||||
Banks — Foreign | 19.3% | |||
Asset-Backed — Yankee | 16.2% | |||
Asset-Backed — Residential Mortgages | 7.0% | |||
Asset-Backed — Mortgages | 6.6% | |||
Asset-Backed — Trade & Term Receivables | 6.3% | |||
Building Society | 5.9% | |||
Security Brokers & Dealers | 5.1% | |||
Asset-Backed — Domestic | 4.5% | |||
Asset-Backed CDO — Trust Preferred | 3.6% | |||
Other Assets | 25.5% | |||
100.0% |
Nationwide NVIT Money Market Fund
Asset-Backed Commercial Paper (36.4%) | |||||||||
Shares or | |||||||||
Principal Amount | Value | ||||||||
Asset-Backed - Domestic (1.5%) (a) (b) | |||||||||
Harrier Financial Funding U.S. LLC | |||||||||
5.28%, 07/20/07 (c) | $ | 10,000,000 | $ | 9,972,503 | |||||
5.32%, 10/12/07 (d) | 20,000,000 | 19,999,717 | |||||||
29,972,220 | |||||||||
Asset-Backed - Mortgages (6.6%) (c) | |||||||||
Georgetown Funding Co., 5.42%, 07/25/07 | 60,000,000 | 59,786,000 | |||||||
Thornburg Mortgage Capital | |||||||||
5.37%, 07/12/07 (a) (b) | 30,000,000 | 29,951,417 | |||||||
5.37%, 07/19/07 (a) (b) | 12,000,000 | 11,968,200 | |||||||
5.38%, 07/20/07 | 25,000,000 | 24,929,938 | |||||||
5.40%, 07/23/07 (a) (b) | 7,000,000 | 6,977,199 | |||||||
133,612,754 | |||||||||
Asset-Backed - Multi-Seller (3.5%) (a) (b) (c) | |||||||||
Sandlot Funding LLC | |||||||||
5.42%, 07/23/07 | 40,000,000 | 39,869,222 | |||||||
5.38%, 09/18/07 | 7,000,000 | 6,918,433 | |||||||
5.32%, 12/11/07 | 24,992,000 | 24,397,919 | |||||||
71,185,574 | |||||||||
Asset-Backed - Repurchase Agreement (1.9%) | |||||||||
Liquid Funding | |||||||||
5.37%, 07/02/07 (a) (b) (c) | 10,922,000 | 10,920,392 | |||||||
5.28%, 07/16/07 (a) (b) (c) | 15,000,000 | 14,967,479 | |||||||
5.29%, 03/04/08 (d) | 12,000,000 | 11,998,802 | |||||||
37,886,673 | |||||||||
Asset-Backed - Residential Mortgages (7.0%) (c) | |||||||||
Carrera Capital Finance LLC (a) (b) | |||||||||
5.32%, 07/18/07 | 10,406,000 | 10,380,202 | |||||||
5.33%, 07/19/07 | 9,500,000 | 9,475,015 | |||||||
5.32%, 08/02/07 | 13,815,000 | 13,750,574 | |||||||
5.32%, 08/06/07 | 10,500,000 | 10,444,875 | |||||||
5.32%, 08/21/07 | 13,000,000 | 12,903,312 | |||||||
5.33%, 08/30/07 | 4,543,000 | 4,503,173 | |||||||
5.34%, 09/19/07 | 10,000,000 | 9,882,889 | |||||||
Klio II Funding Corp. (b) 5.33%, 07/25/07 (a) | 25,000,000 | 24,912,417 | |||||||
5.34%, 09/10/07 | 30,000,000 | 29,688,192 | |||||||
Ormond Quay Funding LLC, 5.37%, 07/12/07 | 15,000,000 | 14,975,708 | |||||||
140,916,357 | |||||||||
Asset-Backed - Trade & Term Receivables (6.3%) (c) | |||||||||
Falcon Asset Securitization Corp., 5.39%, 07/12/07 | 3,200,000 | 3,194,798 | |||||||
Golden Funding Corp., 5.46%, 07/16/07 | 50,000,000 | 49,887,917 | |||||||
Old Line Funding Corp., 5.42%, 07/05/07 | 3,000,000 | 2,998,217 | |||||||
Three Rivers Funding Corp. | |||||||||
5.46%, 07/05/07 | 26,000,000 | 25,984,458 | |||||||
5.36%, 07/12/07 | 40,000,000 | 39,935,344 | |||||||
5.37%, 07/17/07 | 4,594,000 | 4,583,178 | |||||||
126,583,912 | |||||||||
Asset-Backed - Yankee (6.0%) (c) | |||||||||
Check Point Charlie Ltd. | |||||||||
5.34%, 07/12/07 | 20,000,000 | 19,967,794 | |||||||
5.34%, 07/13/07 | 17,000,000 | 16,970,165 | |||||||
5.39%, 07/17/07 | 10,000,000 | 9,976,356 | |||||||
5.34%, 08/23/07 | 4,516,000 | 4,480,962 | |||||||
5.33%, 09/05/07 | 20,000,000 | 19,807,133 | |||||||
Greyhawk Funding LLC | |||||||||
5.37%, 07/11/07 | 6,028,000 | 6,019,125 | |||||||
5.39%, 07/20/07 | 20,000,000 | 19,943,845 | |||||||
5.37%, 10/01/07 | 6,500,000 | 6,411,961 | |||||||
K(2) USA LLC, 5.31%, 07/09/07 (a) (b) | 2,700,000 | 2,696,856 | |||||||
Sigma Finance, Inc., 5.24%, 11/05/07 (a) (b) | 15,000,000 | 14,726,421 | |||||||
121,000,618 | |||||||||
Asset-Backed CDO - Trust Preferred (3.6%) (c) | |||||||||
Lockhart Funding LLC | |||||||||
5.37%, 07/12/07 | 8,386,000 | 8,372,419 | |||||||
5.33%, 08/13/07 | 11,800,000 | 11,725,934 | |||||||
5.32%, 08/22/07 | 20,000,000 | 19,848,333 | |||||||
5.32%, 08/24/07 | 23,000,000 | 22,818,875 | |||||||
5.33%, 09/13/07 | 10,500,000 | 10,386,472 | |||||||
73,152,033 | |||||||||
Total Asset-Backed Commercial Paper (Cost $734,310,141) | 734,310,141 | ||||||||
Certificates of Deposit (8.1%) | |||||||||
Share or | |||||||||
Principal Amount | Value | ||||||||
Banks - Foreign (8.1%) | |||||||||
Bank of Ireland, 5.44%, 06/16/08 | $ | 23,000,000 | $ | 23,000,000 | |||||
Barclays Bank PLC, 5.35%, 05/05/08 | 20,000,000 | 20,000,000 | |||||||
Deutsche Bank, 5.35%, 08/08/07 | 20,000,000 | 20,000,000 | |||||||
HBOS Treasury Services PLC | |||||||||
5.28%, 09/04/07 | 10,000,000 | 9,999,371 | |||||||
5.40%, 06/13/08 | 20,000,000 | 20,000,000 | |||||||
Natixis | |||||||||
5.40%, 01/22/08 | 35,000,000 | 35,000,000 | |||||||
5.40%, 04/08/08 (d) | 20,000,000 | 20,000,743 | |||||||
5.38%, 05/22/08 | 15,000,000 | 15,000,000 | |||||||
Total Certificates of Deposit (Cost $163,000,114) | 163,000,114 | ||||||||
Commercial Paper (25.6%) (c) | |||||||||
Agricultural Services (3.4%) | |||||||||
Cargill Asia Pacific, 5.47%, 07/06/07 | 50,000,000 | 49,962,569 | |||||||
Cargill Global Funding, 5.38%, 07/12/07 | 19,196,000 | 19,164,855 | |||||||
69,127,424 | |||||||||
Banks - Domestic (1.4%) | |||||||||
KBC Financial Products International Ltd. | |||||||||
5.47%, 07/02/07 | 26,996,000 | 26,991,958 | |||||||
5.34%, 08/06/07 | 1,000,000 | 994,730 | |||||||
27,986,688 | |||||||||
Banks - Foreign (8.0%) | |||||||||
Bank of Ireland | |||||||||
5.33%, 08/17/07 | 21,038,000 | 20,893,527 | |||||||
5.26%, 10/04/07 | 30,000,000 | 29,589,521 | |||||||
Kommunalkredit Austria | |||||||||
5.34%, 08/16/07 | 15,000,000 | 14,899,088 | |||||||
5.33%, 09/05/07 | 12,000,000 | 11,884,280 | |||||||
5.27%, 11/19/07 | 20,000,000 | 19,592,667 | |||||||
UBS Finance (Delaware) LLC | |||||||||
5.29%, 07/06/07 | 3,400,000 | 3,397,537 | |||||||
5.27%, 08/06/07 | 11,740,000 | 11,678,952 | |||||||
5.24%, 11/05/07 | 15,870,000 | 15,580,833 | |||||||
Westpac Capital Corp., 5.28%, 07/12/07 | 33,291,000 | 33,238,015 | |||||||
160,754,420 | |||||||||
Banks - Mortgage (1.6%) | |||||||||
Northern Rock PLC | |||||||||
5.32%, 08/31/07 | $ | 2,587,000 | 2,563,987 | ||||||
5.32%, 10/05/07 | 12,700,000 | 12,522,200 | |||||||
5.33%, 10/09/07 | 16,817,000 | 16,571,285 | |||||||
31,657,472 | |||||||||
Building Society (5.9%) | |||||||||
Nationwide Building Society, 5.27%, 07/10/07 | 50,100,000 | 50,034,901 | |||||||
Yorkshire Building Society | |||||||||
5.28%, 07/18/07 | 10,000,000 | 9,975,397 | |||||||
5.27%, 08/15/07 | 38,142,000 | 37,894,077 | |||||||
5.27%, 10/18/07 | 21,700,000 | 21,358,188 | |||||||
119,262,563 | |||||||||
Finance Lessors (1.2%) (a) (b) | |||||||||
PB Finance (Delaware), 5.36%, 07/16/07 | 25,000,000 | 24,944,948 | |||||||
Financial Services (3.0%) | |||||||||
Alliance & Leicester PLC, 5.31%, 08/28/07 | 10,000,000 | 9,915,578 | |||||||
ING U.S. Funding, 5.26%, 07/30/07 | 30,000,000 | 29,874,575 | |||||||
Private Export Funding Corp., 5.27%, 07/31/07 | 20,000,000 | 19,913,333 | |||||||
59,703,486 | |||||||||
Security Brokers & Dealers (1.1%) | |||||||||
Morgan Stanley Dean Witter & Co. | |||||||||
5.27%, 07/27/07 | 8,000,000 | 7,969,956 | |||||||
5.27%, 09/27/07 | 15,000,000 | 14,809,333 | |||||||
22,779,289 | |||||||||
Total Commercial Paper (Cost $516,216,290) | 516,216,290 | ||||||||
Corporate Bonds (6.3%) | |||||||||
Asset-Backed - Domestic (1.5%) (a) (b) | |||||||||
Harrier Financial Funding LLC, 5.35%, 05/07/08 | 30,000,000 | 30,000,000 | |||||||
Nationwide NVIT Money Market Fund (Continued)
Corporate Bonds (continued) | |||||||||
Shares or | |||||||||
Principal Amount | Value | ||||||||
Asset-Backed - Yankee (3.3%) (a) (b) | |||||||||
Sigma Finance, Inc. | |||||||||
5.33%, 08/16/07 (d) | $ | 12,500,000 | $ | 12,499,955 | |||||
5.32%, 10/05/07 (d) | 15,000,000 | 14,999,600 | |||||||
5.34%, 04/17/08 | 15,000,000 | 15,000,000 | |||||||
Stanfield Victoria Funding, 5.45%, 02/01/08 | 25,000,000 | 25,000,000 | |||||||
67,499,555 | |||||||||
Security Brokers & Dealers (1.5%) | |||||||||
Goldman Sachs Group, Inc., 5.42%, 06/04/08 | 30,000,000 | 30,000,000 | |||||||
Total Corporate Bonds (Cost $127,499,555) | 127,499,555 | ||||||||
Floating Rate Notes (19.3%) (d) | |||||||||
Asset-Backed - CDO (0.9%) | |||||||||
Commodore CDO I Ltd., 5.44%, 12/12/38 | 18,529,259 | 18,529,259 | |||||||
Asset-Backed - Domestic (1.5%) (a) (b) | |||||||||
Liquid Funding, 5.34%, 08/14/07 | 30,000,000 | 29,999,458 | |||||||
Asset-Backed - Yankee (6.9%) | |||||||||
K(2) USA LLC (a) (b) | |||||||||
5.32%, 10/24/07 | $ | 30,000,000 | 29,999,055 | ||||||
5.32%, 10/26/07 | 15,000,000 | 14,999,458 | |||||||
Premier Asset Collateralized Entity LLC | |||||||||
5.30%, 09/25/07 (a) (b) | 25,000,000 | 25,000,000 | |||||||
5.34%, 06/25/08 | 32,000,000 | 31,999,213 | |||||||
Stanfield Victoria Funding LLC | |||||||||
5.29%, 08/15/07 (a) (b) | 18,000,000 | 17,999,667 | |||||||
5.29%, 11/26/07 | 5,000,000 | 4,999,598 | |||||||
5.31%, 06/25/08 (a) (b) | 15,000,000 | 14,999,287 | |||||||
139,996,278 | |||||||||
Banks - Domestic (0.9%) | |||||||||
Wells Fargo & Co., 5.38%, 01/02/08 | 17,000,000 | 17,000,000 | |||||||
Banks - Foreign (3.2%) | |||||||||
HBOS Treasury Services PLC | |||||||||
5.43%, 11/20/07 | 22,000,000 | 22,000,000 | |||||||
5.29%, 12/07/11 (a) (b) | 10,000,000 | 10,000,000 | |||||||
Kommunalkredit Austria, 5.34%, 02/22/08 (a) (b) | 22,500,000 | 22,500,000 | |||||||
Lloyds TSB Group PLC, 5.32%, 06/06/08 (a) (b) | 10,000,000 | 10,000,000 | |||||||
64,500,000 | |||||||||
Banks - Mortgage (0.6%) (a) (b) | |||||||||
Northern Rock PLC, 5.45%, 07/08/08 | 12,500,000 | 12,500,000 | |||||||
Insurance (1.4%) | |||||||||
Allstate Life Global Funding | |||||||||
5.39%, 07/08/08 | 15,000,000 | 15,000,000 | |||||||
5.35%, 07/25/08 (a) (b) | 12,500,000 | 12,500,000 | |||||||
27,500,000 | |||||||||
Personal Credit Institutions (1.4%) | |||||||||
General Electric Capital Corp. | |||||||||
5.45%, 07/09/07 | 21,000,000 | 21,000,000 | |||||||
5.45%, 10/17/07 | 8,000,000 | 8,000,000 | |||||||
29,000,000 | |||||||||
Security Brokers & Dealers (2.5%) | |||||||||
Bear Stearns Cos., Inc., 5.31%, 07/11/08 | 20,000,000 | 20,000,000 | |||||||
Morgan Stanley Dean Witter & Co., 5.36%, 07/02/08 (a) (b) | 30,000,000 | 30,000,000 | |||||||
50,000,000 | |||||||||
Total Floating Rate Notes (Cost $389,024,995) | 389,024,995 | ||||||||
Municipal Bonds (3.6%) | ||||||||
Shares or | ||||||||
Principal Amount | Value | |||||||
Florida (2.0%) (d) | ||||||||
Florida Hurricane Catastrophe, 5.33%, 07/14/08 | $ | 40,000,000 | $ | 39,999,849 | ||||
South Carolina (1.6%) (c) | ||||||||
South Carolina Public Service Authority, 5.35%, 08/23/07 | 33,320,000 | 33,060,992 | ||||||
Total Municipal Bonds (Cost $73,060,841) | 73,060,841 | |||||||
Total Investments (Cost $2,003,111,936) (e) — 99.3% | 2,003,111,936 | |||||||
Other assets in excess of liabilities — 0.7% | 14,726,963 | |||||||
NET ASSETS — 100.0% | $ | 2,017,838,899 | ||||||
(a) | Illiquid security. | |
(b) | Denotes a restricted security that may be resold without restriction to “qualified institutional buyers” as defined by Rule 144A under the Securities Act of 1933 and that the Fund has determined to be liquid under criteria established by the Fund’s Board of Trustees. | |
(c) | The rate reflected in the Statement of Investments is the effective yield as of June 30, 2007. | |
(d) | Variable Rate Security. The rate reflected in the Statement of Investments is the rate in effect on June 30, 2007. The maturity date represents the actual maturity date. | |
(e) | See notes to financial statements for tax unrealized appreciation (depreciation) of securities. |
CDO | Collateralized Debt Obligation |
See accompanying notes to financial statements.
Nationwide NVIT | ||||||
Money Market Fund | ||||||
Assets: | ||||||
Investments, at value (cost $2,003,111,936) | $ | 2,003,111,936 | ||||
Interest and dividends receivable | 5,324,852 | |||||
Receivable for capital shares issued | 11,706,638 | |||||
Prepaid expenses | 22,324 | |||||
Total Assets | 2,020,165,750 | |||||
Liabilities: | ||||||
Payable to custodian | 419 | |||||
Payable for capital shares redeemed | 1,261,368 | |||||
Accrued expenses and other payables: | ||||||
Investment advisory fees | 628,450 | |||||
Fund administration and transfer agent fees | 109,275 | |||||
Administrative servicing fees | 187,357 | |||||
Compliance program costs | 24,258 | |||||
Other | 115,724 | |||||
Total Liabilities | 2,326,851 | |||||
Net Assets | $ | 2,017,838,899 | ||||
Represented by: | ||||||
Capital | $ | 2,017,872,412 | ||||
Accumulated net investment income | 7 | |||||
Accumulated net realized losses from investment transactions | (33,520 | ) | ||||
Net Assets | $ | 2,017,838,899 | ||||
Net Assets: | ||||||
Class I Shares | $ | 1,428,360,668 | ||||
Class IV Shares | 78,781,741 | |||||
Class V Shares | 495,438,758 | |||||
Class ID Shares | 15,257,732 | |||||
Total | $ | 2,017,838,899 | ||||
Shares outstanding (unlimited number of shares authorized): | ||||||
Class I Shares | 1,428,385,543 | |||||
Class IV Shares | 78,783,768 | |||||
Class V Shares | 495,448,998 | |||||
Class ID Shares | 15,257,751 | |||||
Total | 2,017,876,060 | |||||
Net asset value and offering price per share (Net assets by class divided by shares outstanding by class, respectively.): | ||||||
Class I Shares | $ | 1.00 | ||||
Class IV Shares | $ | 1.00 | ||||
Class V Shares | $ | 1.00 | ||||
Class ID Shares | $ | 1.00 | ||||
10
Nationwide NVIT | |||||
Money Market Fund | |||||
INVESTMENT INCOME: | |||||
Interest income | $ | 50,248,557 | |||
Dividend income | 27,115 | ||||
Total Income | 50,275,672 | ||||
Expenses: | |||||
Investment advisory fees | 3,649,099 | ||||
Fund administration and transfer agent fees | 565,814 | ||||
Administrative servicing fees Class I Shares | 973,981 | ||||
Administrative servicing fees Class IV Shares | 51,689 | ||||
Administrative services fees Class V Shares | 159,545 | ||||
Trustee fees | 42,641 | ||||
Compliance program costs (Note 3) | 12,430 | ||||
Other | 134,351 | ||||
Total expenses before reimbursements | 5,589,550 | ||||
Expenses Reimbursed | (40,638 | ) | |||
Net Expenses | 5,548,912 | ||||
Net Investment Income | 44,726,760 | ||||
REALIZED/ UNREALIZED GAINS (LOSSES) FROM INVESTMENTS: | |||||
Net realized gains on investment transactions | 58 | ||||
CHANGE IN NET ASSETS RESULTING FROM OPERATIONS | $ | 44,726,818 | |||
11
Nationwide NVIT Money Market Fund | |||||||||
Six Months Ended | Year Ended | ||||||||
June 30, 2007 | December 31, 2006 | ||||||||
(Unaudited) | |||||||||
FROM INVESTMENT ACTIVITIES: | |||||||||
Operations: | |||||||||
Net investment income | $ | 44,726,760 | $ | 79,353,000 | |||||
Net realized gains on investment transactions | 58 | 15 | |||||||
Change in net assets resulting from operations | 44,726,818 | 793,353,015 | |||||||
Distributions to shareholders from: | |||||||||
Net investment income: | |||||||||
Class I | (31,168,291 | ) | (57,465,795 | ) | |||||
Class IV | (1,890,403 | ) | (3,724,711 | ) | |||||
Class V | (11,280,327 | ) | (17,682,448 | ) | |||||
Class ID | (372,995 | ) | (494,789 | )(a) | |||||
Change in net assets from shareholder distributions | (44,712,016 | ) | (79,367,743 | ) | |||||
Change in net assets from capital transactions | 189,710,625 | 261,739,126 | |||||||
Change in net assets | 189,725,427 | 261,724,398 | |||||||
Net Assets: | |||||||||
Beginning of period | 1,828,113,472 | 1,566,389,074 | |||||||
End of period | $ | 2,017,838,899 | $ | 1,828,113,472 | |||||
Accumulated net investment income (loss) at end of period | $ | 7 | $ | (14,737 | ) | ||||
CAPITAL TRANSACTIONS: | |||||||||
Class I Shares | |||||||||
Proceeds from shares issued | $ | 539,664,202 | $ | 849,969,459 | |||||
Dividends reinvested | 31,168,285 | 57,465,861 | |||||||
Cost of shares redeemed | (411,982,405 | ) | (811,225,710 | ) | |||||
158,850,082 | 96,209,610 | ||||||||
Class IV Shares | |||||||||
Proceeds from shares issued | 16,531,520 | 37,913,703 | |||||||
Dividends reinvested | 1,890,398 | 3,724,652 | |||||||
Cost of shares redeemed | (16,613,623 | ) | (38,780,208 | ) | |||||
1,808,295 | 2,858,147 | ||||||||
Class V Shares | |||||||||
Proceeds from shares issued | 210,178,402 | 453,551,157 | |||||||
Dividends reinvested | 11,280,328 | 17,682,446 | |||||||
Cost of shares redeemed | (192,215,928 | ) | (324,010,539 | ) | |||||
29,242,802 | 147,223,064 | ||||||||
Class ID Shares | |||||||||
Proceeds from shares issued | 1,368,939 | 18,385,037 | (a) | ||||||
Dividends reinvested | 372,995 | 494,684 | (a) | ||||||
Cost of shares redeemed | (1,932,488 | ) | (3,431,416 | )(a) | |||||
(190,554 | ) | 15,448,305 | |||||||
Change in net assets from capital transactions | $ | 189,710,625 | $ | 261,739,126 | |||||
12
Nationwide NVIT Money Market Fund | |||||||||
Six Months Ended | Year Ended | ||||||||
June 30, 2007 | December 31, 2006 | ||||||||
(Unaudited) | |||||||||
SHARE TRANSACTIONS: | |||||||||
Class I Shares | |||||||||
Issued | 539,664,203 | 849,969,458 | |||||||
Reinvested | 31,168,285 | 57,465,861 | |||||||
Redeemed | (411,982,405 | ) | (811,225,710 | ) | |||||
158,850,083 | 96,209,609 | ||||||||
Class IV Shares | |||||||||
Issued | 16,531,520 | 37,913,703 | |||||||
Reinvested | 1,890,398 | 3,724,652 | |||||||
Redeemed | (16,613,623 | ) | (38,780,208 | ) | |||||
1,808,295 | 2,858,147 | ||||||||
Class V Shares | |||||||||
Issued | 210,178,402 | 453,551,157 | |||||||
Reinvested | 11,280,328 | 17,682,446 | |||||||
Redeemed | (192,215,928 | ) | (324,010,539 | ) | |||||
29,242,802 | 147,223,064 | ||||||||
Class ID Shares | |||||||||
Issued | 1,368,939 | 18,385,037 | (a) | ||||||
Reinvested | 372,995 | 494,684 | (a) | ||||||
Redeemed | (1,932,488 | ) | (3,431,416 | )(a) | |||||
(190,554 | ) | 15,448,305 | |||||||
Total change in shares | 189,710,626 | 261,739,125 | |||||||
(a) | For the period from May 1, 2006 (commencement of operations) through December 31, 2006. |
13
Investment Activities | ||||||||||||
Net Asset | Total | |||||||||||
Value, | Net | from | ||||||||||
Beginning | Investment | Investment | ||||||||||
of Period | Income | Activities | ||||||||||
Class I Shares | ||||||||||||
For the year ended December 31, 2002 | $ | 1.00 | 0.01 | 0.01 | ||||||||
For the year ended December 31, 2003 | $ | 1.00 | 0.01 | 0.01 | ||||||||
For the year ended December 31, 2004 | $ | 1.00 | 0.01 | 0.01 | ||||||||
For the year ended December 31, 2005 | $ | 1.00 | 0.03 | 0.03 | ||||||||
For the year ended December 31, 2006 | $ | 1.00 | 0.04 | 0.04 | ||||||||
For the six months ended June 30, 2007 (Unaudited) | $ | 1.00 | 0.02 | 0.02 | ||||||||
Class IV Shares | ||||||||||||
Period ended December 31, 2003(e) | $ | 1.00 | (h | ) | (h | ) | ||||||
For the year ended December 31, 2004 | $ | 1.00 | 0.01 | 0.01 | ||||||||
For the year ended December 31, 2005 | $ | 1.00 | 0.03 | 0.03 | ||||||||
For the year ended December 31, 2006 | $ | 1.00 | 0.05 | 0.05 | ||||||||
For the six months ended June 30, 2007 (Unaudited) | $ | 1.00 | 0.02 | 0.02 | ||||||||
Class V Shares | ||||||||||||
Period ended December 31, 2002(d) | $ | 1.00 | (h | ) | (h | ) | ||||||
For the year ended December 31, 2003 | $ | 1.00 | 0.01 | 0.01 | ||||||||
For the year ended December 31, 2004 | $ | 1.00 | 0.01 | 0.01 | ||||||||
For the year ended December 31, 2005 | $ | 1.00 | 0.03 | 0.03 | ||||||||
For the year ended December 31, 2006 | $ | 1.00 | 0.05 | 0.05 | ||||||||
For the six months ended June 30, 2007 (Unaudited) | $ | 1.00 | 0.02 | 0.02 | ||||||||
Class ID Shares | ||||||||||||
Period ended December 31, 2006 (g) | $ | 1.00 | 0.03 | 0.03 | ||||||||
For the six months ended June 30, 2007 (Unaudited) | $ | 1.00 | 0.02 | 0.02 | ||||||||
[Additional columns below]
[Continued from above table, first column(s) repeated]
Distributions | Ratios/Supplemental Data | |||||||||||||||||||||||
Ratio of | ||||||||||||||||||||||||
Net Assets | Expenses to | |||||||||||||||||||||||
Net | Net Asset | at End of | Average | |||||||||||||||||||||
Investment | Total | Value, End | Total | Period | Net | |||||||||||||||||||
Income | Distributions | of Period | Return (a) | (000s) | Assets (b) | |||||||||||||||||||
Class I Shares | ||||||||||||||||||||||||
For the year ended December 31, 2002 | (0.01 | ) | (0.01 | ) | $ | 1.00 | 1.21% | $ | 2,436,783 | 0.62% | ||||||||||||||
For the year ended December 31, 2003 | (0.01 | ) | (0.01 | ) | $ | 1.00 | 0.63% | $ | 1,573,895 | 0.63% | ||||||||||||||
For the year ended December 31, 2004 | (0.01 | ) | (0.01 | ) | $ | 1.00 | 0.81% | $ | 1,223,530 | 0.62% | ||||||||||||||
For the year ended December 31, 2005 | (0.03 | ) | (0.03 | ) | $ | 1.00 | 2.67% | $ | 1,173,301 | 0.65% | ||||||||||||||
For the year ended December 31, 2006 | (0.04 | ) | (0.04 | ) | $ | 1.00 | 4.53% | $ | 1,269,500 | 0.64% | ||||||||||||||
For the six months ended June 30, 2007 (Unaudited) | (0.02 | ) | (0.02 | ) | $ | 1.00 | 2.38% | $ | 1,428,361 | 0.62% | ||||||||||||||
Class IV Shares | ||||||||||||||||||||||||
Period ended December 31, 2003(e) | (h | ) | (h | ) | $ | 1.00 | 0.46% | $ | 103,515 | 0.50% | ||||||||||||||
For the year ended December 31, 2004 | (0.01 | ) | (0.01 | ) | $ | 1.00 | 0.94% | $ | 84,415 | 0.50% | ||||||||||||||
For the year ended December 31, 2005 | (0.03 | ) | (0.03 | ) | $ | 1.00 | 2.82% | $ | 74,115 | 0.50% | ||||||||||||||
For the year ended December 31, 2006 | (0.05 | ) | (0.05 | ) | $ | 1.00 | 4.67% | $ | 76,973 | 0.50% | ||||||||||||||
For the six months ended June 30, 2007 (Unaudited) | (0.02 | ) | (0.02 | ) | $ | 1.00 | 2.44% | $ | 78,782 | 0.50% | ||||||||||||||
Class V Shares | ||||||||||||||||||||||||
Period ended December 31, 2002(d) | (h | ) | (h | ) | $ | 1.00 | 0.22% | $ | 324,950 | 0.56% | ||||||||||||||
For the year ended December 31, 2003 | (0.01 | ) | (0.01 | ) | $ | 1.00 | 0.71% | $ | 365,299 | 0.55% | ||||||||||||||
For the year ended December 31, 2004 | (0.01 | ) | (0.01 | ) | $ | 1.00 | 0.89% | $ | 479,706 | 0.55% | ||||||||||||||
For the year ended December 31, 2005 | (0.03 | ) | (0.03 | ) | $ | 1.00 | 2.75% | $ | 318,973 | 0.57% | ||||||||||||||
For the year ended December 31, 2006 | (0.05 | ) | (0.05 | ) | $ | 1.00 | 4.61% | $ | 466,192 | 0.56% | ||||||||||||||
For the six months ended June 30, 2007 (Unaudited) | (0.02 | ) | (0.02 | ) | $ | 1.00 | 2.42% | $ | 495,439 | 0.54% | ||||||||||||||
Class ID Shares | ||||||||||||||||||||||||
Period ended December 31, 2006 (g) | (0.03 | ) | (0.03 | ) | $ | 1.00 | 3.26% | $ | 15,448 | 0.48% | ||||||||||||||
For the six months ended June 30, 2007 (Unaudited) | (0.02 | ) | (0.02 | ) | $ | 1.00 | 2.46% | $ | 15,258 | 0.47% | ||||||||||||||
[Additional columns below]
[Continued from above table, first column(s) repeated]
Ratios/Supplemental Data | ||||||||||||||
Ratio of Net | ||||||||||||||
Ratio of | Investment | |||||||||||||
Ratio of Net | Expenses | Income | ||||||||||||
Investment | (Prior to | (Prior to | ||||||||||||
Income | Reimbursements) | Reimbursements) | ||||||||||||
to Average | to Average | to Average | ||||||||||||
Net Assets (b) | Net Assets (b)(c) | Net Assets (b)(c) | ||||||||||||
Class I Shares | ||||||||||||||
For the year ended December 31, 2002 | 1.21% | 0.62% | 1.21% | |||||||||||
For the year ended December 31, 2003 | 0.63% | (f) | (f) | |||||||||||
For the year ended December 31, 2004 | 0.79% | (f) | (f) | |||||||||||
For the year ended December 31, 2005 | 2.63% | (f) | (f) | |||||||||||
For the year ended December 31, 2006 | 4.46% | (f) | (f) | |||||||||||
For the six months ended June 30, 2007 (Unaudited) | 4.76% | 0.62% | 4.76% | |||||||||||
Class IV Shares | ||||||||||||||
Period ended December 31, 2003(e) | 0.67% | 0.63% | 0.55% | |||||||||||
For the year ended December 31, 2004 | 0.91% | 0.62% | 0.79% | |||||||||||
For the year ended December 31, 2005 | 2.76% | 0.65% | 2.62% | |||||||||||
For the year ended December 31, 2006 | 4.58% | 0.64% | 4.44% | |||||||||||
For the six months ended June 30, 2007 (Unaudited) | 4.88% | 0.60% | 4.88% | |||||||||||
Class V Shares | ||||||||||||||
Period ended December 31, 2002(d) | 1.11% | (f) | (f) | |||||||||||
For the year ended December 31, 2003 | 0.70% | (f) | (f) | |||||||||||
For the year ended December 31, 2004 | 0.92% | (f) | (f) | |||||||||||
For the year ended December 31, 2005 | 2.69% | (f) | (f) | |||||||||||
For the year ended December 31, 2006 | 4.56% | (f) | (f) | |||||||||||
For the six months ended June 30, 2007 (Unaudited) | 4.84% | 0.54% | 4.84% | |||||||||||
Class ID Shares | ||||||||||||||
Period ended December 31, 2006 (g) | 4.81% | (f) | (f) | |||||||||||
For the six months ended June 30, 2007 (Unaudited) | 4.91% | 0.47% | 4.91% | |||||||||||
(a) | Not annualized for periods less than one year. | |
(b) | Annualized for periods less than one year. | |
(c) | During the period, certain fees were waived and/or reimbursed. If such waivers/reimbursements had not occurred, the ratios would have been as indicated. | |
(d) | For the period from October 21, 2002 (commencement of operations) through December 31, 2002. | |
(e) | For the period from April 28, 2003 (commencement of operations) through December 31, 2003. | |
(f) | There were no fee waivers/reimbursements during the period. | |
(g) | For the period from May 1, 2006 (commencement of operations) through December 31, 2006. | |
(h) | The amount is less than $0.005 per share. |
See accompanying notes to financial statements.
1. Organization
Nationwide Variable Insurance Trust (“NVIT” or the “Trust”) is an open-end management investment company, organized under the laws of Delaware by an amended and restated Agreement and Declaration of Trust, dated October 28, 2004, as amended to date. Prior to May 1, 2007, the Trust was named “Gartmore Variable Insurance Trust”. The Trust, originally created under the laws of Massachusetts as a Massachusetts business trust pursuant to a Declaration of Trust dated, as of June 30, 1981, and as subsequently amended, redomesticated as a Delaware Statutory Trust after the close of trading on April 29, 2005, and is registered under the Investment Company Act of 1940, as amended (the “1940 Act”). The redomestication was a change in statutory status and did not affect the operations of the Trust. As of June 30, 2007, the Trust had authorized an unlimited number of shares of beneficial interest, without par value (“shares”). The Trust currently offers shares to life insurance company separate accounts to fund the benefits under variable life insurance or annuity policies. To date, only the separate accounts of Nationwide Life Insurance Company and Nationwide Life and Annuity Insurance Company (collectively, “Nationwide”) have purchased shares of the Nationwide NVIT Money Market Fund (the “Fund”), (formerly, “Gartmore GVIT Money Market Fund”). The Trust currently operates forty (40) separate series, or mutual funds, each with its own investment objectives and strategies. This report contains the financial statements and financial highlights of the Fund.
2. Summary of Significant Accounting Policies
The following is a summary of significant accounting policies followed by the Fund in the preparation of its financial statements. The policies are in conformity with accounting principles generally accepted in the United States of America (“GAAP”). The preparation of financial statements requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of income and expenses for the period. Actual results could differ from those estimates.
(a) | Security Valuation |
Investments of the Fund are valued at amortized cost, which approximates market value. Under the amortized cost method, premium or discount, if any, is amortized or accreted, respectively, on a constant (straight-line) basis to the maturity of the security. | |
The Fund values foreign securities at fair value in the circumstances described below. Generally, trading in foreign securities markets is completed each day at various times prior to the Valuation Time. Due to the time differences between the closings of the relevant foreign securities exchanges and the Valuation Time for the Fund, the Fund will fair value its foreign investments when it is determined that the market quotations for the foreign investments either are not readily available or are unreliable and, therefore, do not represent fair value. When the fair value prices are utilized, these prices will attempt to reflect the impact of the U.S. financial markets’ perceptions and trading activities on the Fund’s foreign investments since the last closing prices of the foreign investments were calculated on their primary foreign securities markets or exchanges. For these purposes, the Trust’s Board of Trustees (“Board of Trustees”) has determined that movements in relevant indices or other appropriate market indicators, after the close of the foreign securities exchanges, may demonstrate that market quotations are unreliable, and may trigger fair value pricing for certain securities. Consequently, fair valuation of portfolio securities may occur on a daily basis. |
(b) | Repurchase Agreements |
The Fund may enter into repurchase agreements with an entity which is a member of the Federal Reserve System or which is a “primary dealer” (as designated by the Federal Reserve Bank of New York) in U.S. Government obligations. The repurchase price generally equals the price paid by the Fund plus interest negotiated on the basis of current short-term rates, which may be more or less than the rate on the underlying portfolio securities. The seller under a repurchase agreement is required to maintain the value of the collateral held pursuant to the agreement at a market value equal to or greater than the repurchase price (including accrued interest). Collateral subject to repurchase agreements is held by the Fund’s custodian or another qualified sub-custodian or in the Federal Reserve/ |
Treasury book-entry system. If the counterparty defaults and the fair value of the collateral declines, realization of the collateral by the Fund may be delayed or limited. The Fund may transfer uninvested cash balances into a pooled cash account. These balances are invested in one or more repurchase agreements, with the counterparty of Nomura Securities, which is fully collateralized by U.S. Government Agency Mortgages. |
(c) | Security Transactions and Investment Income |
Security transactions are accounted for on the date the security is purchased or sold (“trade date”). Securities gains and losses are calculated on the identified cost basis. Interest income is recognized on the accrual basis and includes, where applicable, the amortization or accretion of premium or discount. |
(d) | Distributions to Shareholders |
The Fund’s dividends from net investment income, if any, are declared daily and paid monthly. The Fund’s distributions from net realized capital gains, if any, are declared and distributed at least annually. | |
Dividends and distributions to shareholders are determined in accordance with federal income tax regulations, which may differ from GAAP. These “book/tax” differences are considered either permanent or temporary in nature. In accordance with the American Institute of Certified Public Accountants Statement of Position 93-2, permanent differences (i.e., reclassification of market discounts, foreign exchange gain/loss, paydowns, and distributions from real estate investment trusts) are reclassified within the capital accounts based on their nature for federal income tax purposes; temporary differences do not require reclassification. These reclassifications have no effect upon the net asset value of the Fund. To the extent distributions exceed current and accumulated earnings and profits for federal income tax purposes, these distributions are reported as distributions of paid-in-capital. |
(e) | Federal Income Taxes |
It is the policy of the Fund to qualify or to continue to qualify as a “regulated investment company” by complying with the provisions available to certain investment companies, as defined in Subchapter M of the U.S. Internal Revenue Code, and to make distributions of net investment income and net realized capital gains sufficient to relieve the Fund from all, or substantially all, federal income taxes. | |
As of June 30, 2007, the tax cost of securities and the breakdown of unrealized appreciation (depreciation) for the Fund was as follows: |
Net Unrealized | ||||||||||||||||
Tax Cost of | Unrealized | Unrealized | Appreciation | |||||||||||||
Securities | Appreciation | Depreciation | (Depreciation) | |||||||||||||
$ | 2,003,111,936 | $ | — | $ | — | $ | — | |||||||||
(f) | Allocation of Expenses, Income, and Gains and Losses |
Expenses directly attributable to the Fund are charged to the Fund. Expenses not directly attributable to the Fund are allocated proportionately among various or all funds within the Trust. The method used by the Fund for allocating income, fund level expenses, and realized and unrealized gains or losses is based on the fair value of settled shares outstanding. Under this method, earnings are allocated based on the fair value of settled shares. Expenses specific to a class (such as administrative services fees) are charged to that class. |
3. Transactions with Affiliates
Under the terms of the Trust’s Investment Advisory Agreement, Nationwide Fund Advisors (formerly, Gartmore Mutual Fund Capital Trust (“GMF”)) (“NFA” or the “Advisor”) manages the investment of the assets and supervises the daily business affairs of the Fund. NFA is a wholly-owned subsidiary of Nationwide Financial Services (“NFS”).
Under the terms of the Investment Advisory Agreement, the Fund pays NFA an investment advisory fee based on the Fund’s average daily net assets and the following schedule:
Schedule | Fees | |||||
Up to $1 billion | 0.40% | |||||
Next $1 billion | 0.38% | |||||
Next $3 billion | 0.36% | |||||
$5 billion or more | 0.34% | |||||
Effective May 1, 2007, NFA and the Fund have entered into a written contract (“Expense Limitation Agreement”) limiting operating expenses (excluding any taxes, interest, brokerage fees, short-sale dividend expenses, other expenses which are capitalized in accordance with generally accepted accounting principles and may exclude other non-routine expenses not incurred in the ordinary course of the Fund’s business) from exceeding 0.50% for Class IV shares until at least May 1, 2008.
NFA may request and receive reimbursement from the Fund of the advisory fees waived and other expenses reimbursed by NFA, respectively, pursuant to the Expense Limitation Agreement at a later date not to exceed three years from the fiscal year in which the corresponding reimbursement to the Fund was made, depending on the Fund (as described below), if the Fund has reached a sufficient asset size to permit reimbursement to be made without causing the total annual operating expense ratio of the Fund to exceed the limits set forth above. No reimbursement will be made unless: (i) the Fund’s assets exceed $100 million; (ii) the total annual expense ratio of the Class making such reimbursement is less than the limit set forth above; and (iii) the payment of such reimbursement is approved by the Board of Trustees on a quarterly basis. Except as provided for in the Expense Limitation Agreement, reimbursement of amounts previously waived or assumed by NFA is not permitted.
As of June 30, 2007, the cumulative potential reimbursements for the Class IV shares of the Fund, based on reimbursements which expire within three years from the fiscal year in which the corresponding reimbursement to the Fund was made for expenses reimbursed by NFA would be:
Amount | Amount | Amount | Amount | |||||||||||||
Fiscal Year | Fiscal Year | Fiscal Year | Six Months Ended | |||||||||||||
2004 | 2005 | 2006 | June 30, 2007 | |||||||||||||
$ | 116,217 | $ | 119,939 | $ | 112,415 | $ | 40,638 | |||||||||
Under the terms of a Fund Administration and Transfer Agency Agreement, Nationwide Fund Management, LLC ((formerly, Gartmore Investor Services, Inc. (“GISI”)) (“NFM”), a wholly-owned subsidiary of NFS Distributors, Inc. (“NFSDI”), provides the Fund with various administrative and accounting services for the Fund (prior to May 1, 2007, this service was provided by Gartmore SA Capital Trust (“GSA”)), and serves as Transfer and Dividend Disbursing Agent for the Fund (prior to May 1, 2007, this service was provided by GISI, an indirect subsidiary of GSA.) The fees for the services provided under this Agreement are calculated based on the Trust’s average daily net assets according to the fee schedule below. The fees are then allocated proportionately among all funds within the Trust in relation to the average daily net assets of each fund and are paid to NFA. NFA pays NFM from these fees for NFM’s services.
Combined Fee Schedule* | ||||||
Up to $1 billion | 0.15% | |||||
$1 billion up to $3 billion | 0.10% | |||||
$3 billion up to $8 billion | 0.05% | |||||
$8 billion up to $10 billion | 0.04% | |||||
$10 billion up to $12 billion | 0.02% | |||||
$12 billion or more | 0.01% | |||||
* | The assets of the Nationwide NVIT Investor Destinations Aggressive Fund, the Nationwide NVIT Investor Destinations Moderately Aggressive Fund, the Nationwide NVIT Investor Destinations Moderate Fund, the Nationwide NVIT Investor Destinations Moderately Conservative Fund, and the Nationwide NVIT Investor Destinations Conservative Fund (collectively, the “Investor Destinations Funds”) are excluded from the Trust asset level amount in order to calculate this asset-based fee. The Investor Destinations Funds do not pay any part of this fee. |
NFA and NFM have entered into agreements with Citi Fund Services Ohio, Inc. (“Citi”), pursuant to which Citi provides sub-administration and sub-transfer agency services, respectively, to the Fund. Effective August 1, 2007, The BISYS Group Inc. was acquired by and became a wholly owned subsidiary of Citi.
Under the terms of an Administrative Services Plan, the Fund may pay fees to servicing organizations, such as broker-dealers, including NFS, and financial institutions, which agree to provide administrative support services to the shareholders of certain classes. These services include, but are not limited, to the following: establishing and maintaining shareholder accounts; processing purchase and redemption transactions; arranging bank wires; performing shareholder sub-accounting; answering inquires regarding the Fund; and other such services. These fees are based on an annual rate of up to 0.25%, 0.20% and 0.10% of the average daily net assets of Class I, Class IV, and Class V shares, respectively, of the Fund.
For the six months ended June 30, 2007, NFS received $1,204,768 in Administrative Services Fees from the Fund.
Under the terms of a letter agreement dated September 12, 2006, by and among NFA, the Audit Committee of the Trust and the Trust, the Trust has agreed to reimburse NFA certain costs related to the Fund’s portion of ongoing administration, monitoring and annual (audit) testing of the Trust’s Rule 38a-1 Compliance Program subject to the pre-approval of the Trust’s Audit Committee. For the six months ended June 30, 2007, the Fund’s portion of such cost amounted to $12,430.
4. Bank Loans and Earnings Credit
The Trust has a credit agreement with JPMorgan Chase & Co., the Fund’s custodian bank, permitting the Trust to borrow up to $100,000,000. Borrowings under this arrangement bear interest at the Federal Funds rate plus 0.50%. The interest costs, if any, would be included in other fees in the Statement of Operations. No compensating balances were required under the terms of the line of credit. The line of credit is renewed annually, expiring on June 25, 2008, with a commitment fee of 0.07% per year on $100,000,000. There were no borrowings outstanding under this line of credit for the six months ended June 30, 2007.
The Trust’s custodian bank has agreed to reduce the bank’s fees (earnings credit) when the funds of the Trust maintain cash on deposit in non-interest-bearing custody and Demand Deposit Accounts. Earnings credits, if any, are shown as a reduction of total expenses on the Statement of Operations.
5. Portfolio Investment Risks
Risks Associated with Foreign Securities and Currencies. Investments in securities of foreign issuers carry certain risks not ordinarily associated with investments in securities of U.S. issuers. These risks include future political and economic developments, and the possible imposition of exchange controls or other foreign governmental laws and restrictions. In addition, with respect to certain countries, there is the possibility of expropriation of assets, confiscatory taxation, political or social instability, or diplomatic developments, which could adversely affect investments in those countries.
Certain countries also may impose substantial restrictions on investments in their capital markets by foreign entities, including restrictions on investments in issuers of industries deemed sensitive to relevant national interests. These factors may limit the investment opportunities available and result in a lack of liquidity and high price volatility with respect to securities of issuers from developing countries.
6. Indemnifications
Under the Trust’s organizational documents, certain of the Trust’s Officers and Trustees are indemnified against certain liabilities arising out of the performance of their duties to the Trust. In addition, the Trust has entered into Indemnification Agreements with the Trust’s trustees and certain officers covering similar liabilities. Trust Officers receive no compensation from the Trust for serving as the Trust’s Officers. In addition, in the normal course of business, the Trust enters into contracts with its vendors and others that provide for general indemnifications. The Trust’s maximum exposure under these arrangements is unknown, as this would involve future claims that may be made against the Trust. Based on experience, however, the Trust expects that risk of loss to be remote.
7. Recently Issued Accounting Pronouncements
On July 13, 2006, the Financial Accounting Standards Board (“FASB”) released FASB Interpretation No. 48, Accounting for Uncertainty in Income Taxes (“FIN 48”). FIN 48 provides guidance for how uncertain tax positions should be recognized, measured, presented and disclosed in the financial statements. FIN 48 requires the affirmative evaluation of tax positions taken or expected to be taken in the course of preparing the Fund’s tax returns to determine whether it is more-likely-than-not (i.e., greater than 50 percent) that each tax position will be sustained upon examination by a taxing authority based on the technical merits of the position. A tax position that meets the more-likely-than-not recognition threshold is measured to determine the amount of benefit to recognize in the financial statements. Differences between tax positions taken in a tax return and amounts recognized in the financial statements will generally result in an increase in a liability for taxes payable (or a reduction of a tax refund receivable) and an increase in a deferred tax liability (or a reduction in a deferred tax asset). Adoption of FIN 48 was required no later than the last business day of the first financial statement reporting period for fiscal years beginning after December 15, 2006 and is to be applied to all open tax years as of the effective date. Accordingly, the Fund was required to implement FIN 48 in its net asset value per share (NAV) calculation on June 29, 2007. Management has evaluated the implications of FIN 48 and has concluded that there was no impact to the Fund’s financial statements as of June 29, 2007. The adoption of FIN 48 requires ongoing monitoring and analysis, future conclusions reached by management may be different and result in adjustments to the Fund’s NAV and financial statements.
In September 2006, the FASB issued Statement on Financial Accounting Standards (“SFAS”) No. 157, “Fair Value Measurements.” This standard establishes a single authoritative definition of fair value, sets out a framework for measuring fair value and requires additional disclosures about fair value measurements. SFAS No. 157 applies to fair value measurements already required or permitted by existing standards. SFAS No. 157 is effective for financial statements issued for fiscal years beginning after November 15, 2007 and interim periods within those fiscal years. The changes to current accounting principles generally accepted in the United States of America from the application of this Statement relate to the definition of fair value, the methods used to measure fair value, and the expanded disclosures about fair value measurements. As of June 30, 2007, the Fund does not believe the adoption of SFAS No. 157 will impact the financial statement amounts; however, additional disclosures may be required about the inputs used to develop the measurements and the effect of certain of the measurements on changes in net assets for the period.
Trustees who are not Interested Persons (as defined in the 1940 Act) and Officers of the Trust as of
Number of Portfolios | ||||||||||
Position(s) Held | in the | |||||||||
with the Trust | Principal Occupation(s) | Nationwide Fund | Other | |||||||
Name, Address | and Length of | During Past | Complex Overseen | Directorships | ||||||
and Year of Birth | Time Served1 | Five Years | by Trustee | Held by Trustee2 | ||||||
Charles E. Allen c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1948 | Trustee since July 2000 | Mr. Allen is Chairman, Chief Executive Officer and President of Graimark Realty Advisors, Inc. (real estate development, investment and asset management). | 89 | None | ||||||
Paula H.J. Cholmondeley c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1947 | Trustee since July 2000 | Ms. Cholmondeley was Vice President and General Manager of Sappi Fine Paper North America from April 2000 through December 2003. | 89 | Director of Dentsply International, Inc. (dental products), Ultralife Batteries, Inc., Terex Corporation (construction equipment), Minerals Technology, Inc. (specialty chemicals) and Albany International Corp. (paper industry) | ||||||
C. Brent DeVore3 c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1940 | Trustee since 1990 | Dr. DeVore is President of Otterbein College. | 89 | None | ||||||
Phyllis Kay Dryden c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1947 | Trustee since December 2004 | Ms. Dryden was a partner of Mitchell Madison, a management consulting company from January 2006 until December 2006; she is currently a consultant with the company. Ms. Dryden was formerly Managing Partner of march FIRST, a global management consulting firm. | 89 | None | ||||||
Barbara L. Hennigar c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1935 | Trustee since July 2000 | Retired. | 89 | None | ||||||
Number of Portfolios | ||||||||||
Position(s) Held | in the | |||||||||
with the Trust | Principal Occupation(s) | Nationwide Fund | Other | |||||||
Name, Address | and Length of | During Past | Complex Overseen | Directorships | ||||||
and Year of Birth | Time Served1 | Five Years | by Trustee | Held by Trustee2 | ||||||
Barbara I. Jacobs c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1950 | Trustee since December 2004 | Ms. Jacobs served as Chairman of the Board of Directors of KICAP Network Fund, a European (United Kingdom) hedge fund, from January 2001 through January 2006. From 1998-2003, Ms. Jacobs was also a Managing Director and European Portfolio Manager of CREF Investments (Teachers Insurance and Annuity Association-College Retirement Equities Fund). | 89 | None | ||||||
Douglas F. Kridler c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1955 | Trustee since September 1997 | Mr. Kridler has served as the President and Chief Executive Officer of the Columbus Foundation (a Columbus, OH-based foundation which manages over 1,300 individual endowment funds) since February 2002. Prior to January 31, 2002, Mr. Kridler was the President of the Columbus Association for the Performing Arts and Chairman of the Greater Columbus Convention and Visitors Bureau. | 89 | None | ||||||
Michael D. McCarthy c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1947 | Trustee since December 2004 | Retired. Mr. McCarthy was Chairman of VMAC (commodity swaps) from October 2002 until January 2007; and a partner of Pineville Properties LLC (a commercial real estate development firm) from September 2000 until January 2007. | 89 | None | ||||||
David C. Wetmore c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1948 | Trustee since 1995 and Chairman since February 2005 | Retired. | 89 | None | ||||||
1 | Length of time served includes time served with the Trust’s predecessors. | |
2 | Directorships held in (1) any other investment companies registered under the 1940 Act, (2) any company with a class of securities registered pursuant to Section 12 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or (3) any company subject to the requirements of Section 15(d) of the Exchange Act. | |
3 | Mr. DeVore has served as President of Otterbein College since 1984. Mark Thresher, President and Chief Operating Officer of Nationwide Financial Services, Inc. (“NFS”) has served as a member of the Board of Trustees of Otterbein College since 2000, currently serves as one of 30 of its trustees, and is currently one of two Vice Chairmen of the Board. Each of Nationwide Fund Advisors (“NFA”), the Funds’ investment adviser, and Nationwide Fund Distributors LLC (“NFD”), principal underwriter to the Trust, is a wholly-owned subsidiary of NFS. | |
Additional information regarding the Trustees and Officers may be found in the Trust’s Statement of Additional Information, which is available without charge upon request, by calling 800-848-0920. |
Trustees who are Interested Persons (as defined in the 1940 Act) and/or Officers of the Trust as of
Number of Portfolios | ||||||||||
Position(s) Held | in the | |||||||||
with the Trust | Principal Occupation(s) | Nationwide Fund | Other | |||||||
Name, Address | and Length of | During Past | Complex Overseen | Directorships | ||||||
and Year of Birth | Time Served1 | 5 Years | by Trustee | Held by Trustee 2 | ||||||
Arden L. Shisler c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1941 | Trustee since February 2000 | Retired. Mr. Shisler is the former President and Chief Executive Officer of KeB Transport, Inc., a trucking firm (2000 through 2002). He served as a consultant to KeB from January 2003 through December 2004. Since 1992, Mr. Shisler has also been Chairman of the Board for Nationwide Mutual Insurance Company.3 | 89 | Director of Nationwide Financial Services, Inc., Chairman of Nationwide Mutual Insurance Company3 | ||||||
John H. Grady Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1961 | President & Chief Executive Officer since December 2006 | Mr. Grady is President, and Chief Executive Officer of Nationwide Funds Group which includes Nationwide Fund Advisors,3 Nationwide Fund Management LLC,3 Nationwide Fund Distributors LLC 3 and NWD Investments,2 the asset management operations of Nationwide Mutual Insurance Company, which includes Morley Capital Management, Inc.,2 Nationwide Separate Accounts LLC,2 NorthPointe Capital LLC,2 and Nationwide SA Capital Trust2. From March 2004 until March 2006, Mr. Grady was Chief Executive Officer of Constellation Investment Management Co., L.P. (registered investment adviser), and President and Chief Executive Officer of Constellation Funds Group (registered investment companies). He also was President of Constellation Investment Distribution Co., Inc. (registered broker-dealer) from March 2004 until June 2006. From February 2001 until February 2004, Mr. Grady was Chief Operating and Chief Legal Officer; Managing Director, Mutual Funds Group, Turner Investment Partners, Inc. (registered investment adviser); Executive Vice President of Turner Funds and Turner Institutional Portfolios (registered investment companies); and President, Turner Investment Distributors, Inc. (registered broker-dealer). | N/A | None | ||||||
Gerald J. Holland Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1951 | Treasurer since March 2001 | Mr. Holland is Senior Vice President—Operations for Nationwide Funds Group3. | N/A | N/A | ||||||
Number of Portfolios | ||||||||||
Position(s) Held | in the | |||||||||
with the Trust | Principal Occupation(s) | Nationwide Fund | Other | |||||||
Name, Address | and Length of | During Past | Complex Overseen | Directorships | ||||||
and Year of Birth | Time Served1 | 5 Years | by Trustee | Held by Trustee 2 | ||||||
Michael A. Krulikowski Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1959 | Chief Compliance Officer from June 2004 to August 20074 | Mr. Krulikowski is Vice President and Chief Compliance Officer of Nationwide Funds Group3, Morley Capital Management, Inc.3, Nationwide SA Capital Trust (since 1999)3, and Nationwide Separate Accounts LLC (since August 2005).3 Since June 2004, Mr. Krulikowski has also served as Chief Compliance Officer of the Trust. From November 1999 through May 2007, he served as Vice President and Chief Compliance Officer of NorthPointe Capital LLC. 3 | N/A | N/A | ||||||
Eric E. Miller Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1953 | Secretary since December 2002 | Mr. Miller is Senior Vice President, General Counsel, and Assistant Secretary for Nationwide Funds Group3 and NWD Investments.2 From August 2000 to August 2002, Mr. Miller was a Partner with Stradley Ronon Stevens & Young, LLP. | N/A | N/A | ||||||
1 | Length of time served includes time served with the Trust’s predecessors. | |
2 | Directorships held in (1) any other investment companies registered under the 1940 Act, (2) any company with a class of securities registered pursuant to Section 12 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or (3) any company subject to the requirements of Section 15(d) of the Exchange Act. | |
3 | This position is held with an affiliated person or principal underwriter of the Trust. | |
4 | Effective August 3, 2007, the Board of Trustees approved Carol Baldwin Moody as Chief Compliance Officer of the Trust. Since November 2005, Ms. Moody has been Senior Vice President, Chief Compliance Officer of Nationwide Financial Services, Nationwide Life Insurance Company, Nationwide Life and Annuity Insurance Company, and Nationwide Investment Advisors, LLC. From February 2004-November 2005, she was Chief Compliance Officer of TIAA-CREF and from April 2000-February 2004, she was Managing Director and General Counsel, TCW/ Latin America Partners, LLC and Baeza & Co., LLC. | |
Federal law requires the Trust, each of its investment advisers and sub-advisers to adopt procedures for voting proxies (“Proxy Voting Guidelines”) and to provide a summary of those Proxy Voting Guidelines used to vote the securities held by the Funds. The Funds’ proxy voting policies and procedures are available without charge (i) upon request, by calling 800-848-0920, (ii) on the Funds’ website at www.nationwidefunds.com, or (iii) on the Securities and Exchange Commission’s website at www.sec.gov. |
A. Renewal of Investment Advisory Agreement
(i) General Information Regarding the Board’s Review of Investment Advisory Agreements
The Trust’s investment advisory agreements (each an “Advisory Agreement”) with its investment adviser and, as applicable, sub-advisers (together, the “Adviser”) must be approved for an initial term no greater than two years, and renewed at least annually thereafter, (i) by the vote of the Trustees or by a vote of the shareholders of each series or fund of the Trust (individually a “Fund” ), and (ii) by the vote of a majority of the Trustees who are not parties to the Advisory Agreement or “interested persons” of any party thereto (the “Independent Trustees”) cast in person at a meeting called for the purpose of voting on such approval.
The Board meets quarterly and takes into account throughout the year matters bearing on each Fund’s Advisory Agreement. The Board and its standing committees consider at each meeting factors that are relevant to the annual renewal of an Advisory Agreement, including the services and support provided to a Fund and its shareholders.
On December 6, 2006, the Independent Trustees first met in person with their independent legal counsel (“Independent Legal Counsel”) to consider information provided by the Adviser and others to assist the Trustees in considering whether to renew each Fund’s Advisory Agreement for a one year term beginning May 1, 2007. Immediately following such meeting of the Independent Trustees, all Trustees met in person with the Adviser, Trust counsel, Independent Legal Counsel and others to consider such matters, and give preliminary consideration to information bearing on continuation of each Advisory Agreement. The primary purpose of the December 6 and 7, 2006 meeting was to ensure that the Trustees had ample opportunity to consider matters they deemed relevant in considering the continuation of an Advisory Agreement, and to request any additional information they considered reasonably necessary to their deliberations.
In preparation for the December 6 and 7, 2006 meeting the Trustees were provided, at the request of the Trustees, with a wide range of information to assist in their deliberations, including (i) reports from Lipper Inc. describing a Fund’s (a) performance rankings (where “first quintile” denotes the best performance) (over multiple years ended September 30, 2006) compared with performance groups and performance universes created by Lipper (and in some cases, customized peer groups created by the Adviser) of similar or peer group funds, and (b) expense rankings (where “first quintile” denotes the lowest fees and expenses) comparing the Fund’s contractual advisory fee and total expenses with expense groups and expense universes created by Lipper of similar or peer group funds, (ii) information from the Adviser describing the Fund’s performance (over multiple years ended September 30, 2006) compared with its benchmark and Lipper categories, (iii) for Funds under “close review,” copies of letters from the Adviser to the portfolio manager of each such Fund, together with the portfolio manager’s written response describing the reasons for the Fund’s underperformance (iv) information from the Adviser describing performance for the months of October and November, 2006, and annual performance for the year ended November 30, 2006, (v) reports from the Adviser describing the Adviser’s profitability in providing services under an Advisory Agreement, together with an explanation of Adviser’s methodology in calculating its profitability, (vi) information from the Adviser describing any fees paid to the Adviser for managing similar, non-affiliated institutional accounts, including the range of fee levels for such accounts, and (vii) information from the Adviser describing ancillary benefits, in addition to fees for serving as investment adviser, derived by the Adviser as a result of being investment adviser for a Fund, including, where applicable, information on soft-dollar benefits and fees inuring to the Adviser’s affiliates for serving as the Trust’s administrator, fund accountant and transfer agent.
At the December 6 and 7, 2006 meeting, the Trustees reviewed, considered and discussed, among themselves and with the Adviser, Trust counsel and Independent Legal Counsel, among other things, the information described above, and: (i) the nature, extent and quality of services provided by the Adviser under each Advisory Agreement, (ii) the investment performance of each Fund and the Adviser, (iii) the costs of the services provided by the Adviser under the Advisory Agreement and the profits realized by the Adviser thereunder, (iv) the extent to which economies of scale may be present and, if so, whether they are being shared with a Fund’s shareholders, (v) comparisons of the Adviser’s fees under the Advisory Agreement with investment advisory fees paid by peer group funds to their investment advisers and paid by non-affiliated institutional clients to the Adviser for managing similar accounts, and (vi) any ancillary benefits inuring to the Adviser and its affiliates as a result of being investment adviser for the Trust. The Trustees also considered, where
As part of the December 6 and 7, 2006 Board meeting, the Independent Trustees developed a list of follow-up matters and questions and asked that Adviser respond to such matters and questions at the contract approval meeting of the Board of Trustees to be held on January 11, 2007.
At the January 11, 2007 meeting of the Board of Trustees of the Trust, the Board received and considered information provided by the Adviser in follow-up from the December 6 and 7, 2006 Board meeting and, after consulting among themselves, and with the Adviser, Trust counsel and Independent Legal Counsel, concluded unanimously to renew the Advisory Agreement for the reasons set forth in the following section. In determining whether to renew the Advisory Agreement for the Fund, the Board ultimately reached a determination, with the assistance of Trust counsel and Independent Legal Counsel, that the renewal of the Advisory Agreement and the compensation to be received by the Adviser under the Advisory Agreement is consistent with the Board’s fiduciary duty under applicable law.
(ii) Board Conclusions Regarding the Fund’s Advisory Agreement
The Board considered that the Fund had outperformed its benchmark, the iMoney Net First Tier Index, over the one-, three-, and five-year periods. The Board also considered that the performance of the Fund’s Class I shares compared to its Lipper-constructed Performance Group ranked in the second quintile over the one-, two-, three-, four-, and five-year periods. Based on its review, and giving particular weight to the nature and quality of the resources dedicated by the Fund’s adviser to maintain relative performance, the Board concluded that the nature, extent, and quality for the services provided to the Fund will benefit the Fund’s shareholders.
The Board also considered that the Fund’s contractual advisory fee and breakpoints place the Fund in the fourth quintile of its Lipper-constructed Expense Group and the Fund’s total expenses placed the Fund in the second quintile. The Board found that the Fund’s contractual advisory fee compared with its peer group was relatively high, but within the range of fees charged by its peer group. The Board also considered that the Fund’s total expenses were relatively low compared to its peer group. The Board concluded the Fund’s management fee and total expenses were fair and reasonable in light of the services the Fund receives and the other factors discussed.
The Board considered that the Fund’s adviser reported a pre-tax profit margin for investment management services for during the twelve month-periods ended September 30, 2006 and 2005. The Board also considered the costs of the services provided and the amounts of the profits realized by the adviser and determined the amount of profit is a fair entrepreneurial profit for management of the Fund.
Based upon its evaluation of all of the conclusions noted above, and after considering all material factors with respect to the Fund, the Board ultimately concluded that the advisory fee structure is fair and reasonable, and that the Advisory Agreement (and, if applicable, Sub-Advisory Agreement) with respect to the Fund, should be renewed.
B. Approval of New Advisory Agreement
At its January 11, 2007 meeting, the Board also unanimously approved a new investment advisory agreement (the “New Agreement”) for the Fund with Nationwide Fund Advisors, (“NFA”) the then-current adviser to each of the series of the Trust to become effective upon the closing of the acquisition of NFA by Nationwide Financial Services, Inc. (“NFS”) from Nationwide Corporation (“NWC”) which closed on April 30, 2007 (the “Transaction”). In approving the New Agreement, the Board considered NFA’s capacity to continue to provide the services needed to operate a sophisticated investment management business and to support the management of each of the series. The Board also took into account the information provided to them at their regular quarterly meetings with NFA’s senior management with respect to the Fund, including the information provided by management at the Fund’s annual Section 15(c) meetings on December 6-7, 2006 and January 11, 2007. In addition, the Board also considered NFS’ announced intentions, over time, that NFA
C. Submission of Matters to a Vote of Security Holders:
On April 25, 2007, a Special Meeting of Shareholders was held* (the “April 25 Meeting”) at which shareholders of the Funds** set forth below were asked:
Proposal 1:
To approve a new investment advisory agreement, on behalf of their Fund, between Nationwide Fund Advisors (formerly “Gartmore Mutual Fund Capital Trust”) (the “Adviser”) and Nationwide Variable Insurance Trust (formerly “Gartmore Variable Insurance Trust”) (the “Trust”).
Number of Shares | ||||||
Fund | Cast/Not Cast | Percentages | ||||
Federated NVIT High Income Bond Fund (Formerly Federated GVIT High Income Bond Fund) | FOR AGAINST ABSTAIN TOTAL | 30,051,703.188 shares 618,245.021 shares 1,813,550.431 shares 32,483,498.640 shares | 92.514% 1.903% 5.583% | |||
NVIT International Index Fund (Formerly GVIT International Index Fund) | FOR AGAINST ABSTAIN TOTAL | 4,322,203.982 shares 2,758.318 shares 135,636.840 shares 4,460,599.140 shares | 96.897% 0.062% 3.041% | |||
NVIT International Value Fund (Formerly GVIT International Value Fund) | FOR AGAINST ABSTAIN TOTAL | 20,032,843.199 shares 333,588.902 shares 1,093,293.879 shares 21,459,725.980 shares | 93.351% 1.554% 5.095% | |||
NVIT Mid Cap Index Fund (Formerly GVIT Mid Cap Index Fund) | FOR AGAINST ABSTAIN TOTAL | 35,380,179.120 shares 631,117.844 shares 1,565,714.306 shares 37,577,011.270 shares | 94.154% 1.679% 4.167% | |||
NVIT S&P 500 Index Fund (Formerly GVIT S&P 500 Index Fund) | FOR AGAINST ABSTAIN TOTAL | 56,119,814.230 shares 666,195.542 shares 1,944,898.888 shares 58,730,908.660 shares | 95.554% 1.134% 3.312% |
Number of Shares | ||||||
Fund | Cast/Not Cast | Percentages | ||||
Nationwide Multi-Manager NVIT Small Cap Growth Fund (Formerly GVIT Small Cap Growth Fund) | FOR AGAINST ABSTAIN TOTAL | 7,632,918.513 shares 149,458.111 shares 451,583.036 shares 8,233,959.660 shares | 92.700% 1.816% 5.484% | |||
Nationwide Multi-Manager NVIT Small Cap Value Fund (Formerly GVIT Small Cap Value Fund) | FOR AGAINST ABSTAIN TOTAL | 48,649,396.525 shares 979,183.753 shares 2,786,133.102 shares 52,414,713.380 shares | 92.816% 1.868% 5.316% | |||
Nationwide Multi-Manager NVIT Small Company Fund (Formerly GVIT Small Company Fund) | FOR AGAINST ABSTAIN TOTAL | 29,903,181.700 shares 838,774.923 shares 2,006,741.307 shares 32,748,697.930 shares | 91.311% 2.561% 6.128% | |||
Gartmore NVIT Developing Markets Fund (Formerly Gartmore GVIT Developing Markets Fund) | FOR AGAINST ABSTAIN TOTAL | 21,0177,889.443 shares 424,272.958 shares 1,543,850.729 shares 23,046,013.130 shares | 91.460% 1.841% 6.699% | |||
Gartmore NVIT Emerging Markets Fund (Formerly Gartmore GVIT Emerging Markets Fund) | FOR AGAINST ABSTAIN TOTAL | 17,050,534.593 shares 526,574.722 shares 881,608.905 shares 18,458,718.220 shares | 92.371% 2.853% 4.776% | |||
Nationwide NVIT Global Financial Services Fund (Formerly Gartmore GVIT Global Financial Services Fund) | FOR AGAINST ABSTAIN TOTAL | 1,554,847.333 shares 19,539.033 shares 52,206.494 shares 1,626,592.860 shares | 95.589% 1.201% 3.210% | |||
Nationwide NVIT Global Health Sciences Fund (Formerly Gartmore GVIT Global Health Sciences Fund) | FOR AGAINST ABSTAIN TOTAL | 4,722,963.678 shares 157,979.030 shares 207,642.222 shares 5,088,584.930 shares | 92.815% 3.104% 4.081% | |||
Nationwide NVIT Global Technology and Communications Fund (Formerly Gartmore GVIT Global Technology and Communications Fund) | FOR AGAINST ABSTAIN TOTAL | 8,585,472.039 shares 102,267.977 shares 489,577.634 shares 9,177,317.650 shares | 93.551% 1.114% 5.335% | |||
Gartmore NVIT Global Utilities Fund (Formerly Gartmore GVIT Global Utilities Fund) | FOR AGAINST ABSTAIN TOTAL | 4,123,270.549 shares 122,001.533 shares 240,276.088 shares 4,485,548.170 shares | 91.923% 2.720% 5.357% | |||
Nationwide NVIT Government Bond Fund (Formerly Gartmore GVIT Government Bond Fund) | FOR AGAINST ABSTAIN TOTAL | 88,471,567.462 shares 1,825,645.181 shares 5,841,990.727 shares 96,139,203.370 shares | 92.024% 1.899% 6.077% | |||
Nationwide NVIT Growth Fund (Formerly Gartmore GVIT Growth Fund) | FOR AGAINST ABSTAIN TOTAL | 14,931,435.904 shares 409,826.402 shares 1,259,945.064 shares 16,601,207.370 shares | 89.942% 2.469% 7.589% |
Number of Shares | ||||||
Fund | Cast/Not Cast | Percentages | ||||
Gartmore NVIT International Growth Fund (Formerly Gartmore GVIT International Growth Fund) | FOR AGAINST ABSTAIN TOTAL | 6,251,419.070 shares 139,618.548 shares 290,025.592 shares 6,681,063.210 shares | 93.569% 2.090% 4.341% | |||
Nationwide NVIT Investor Destinations Aggressive Fund (Formerly Gartmore GVIT Investor Destinations Aggressive Fund) | FOR AGAINST ABSTAIN TOTAL | 49,489,224.549 shares 1,385,396.474 shares 3,696,272.337 shares 54,570,893.360 shares | 90.688% 2.539% 6.773% | |||
Nationwide NVIT Investor Destinations Conservative Fund (Formerly Gartmore GVIT Investor Destinations Conservative Fund) | FOR AGAINST ABSTAIN TOTAL | 23,091,965.887 shares 314,935,884 shares 2,292,355.179 shares 25,699,256.950 shares | 89.855% 1.225% 8.920% | |||
Nationwide NVIT Investor Destinations Moderate Fund (Formerly Gartmore GVIT Investor Destinations Moderate Fund) | FOR AGAINST ABSTAIN TOTAL | 188,902,093.059 shares 3,018,924.590 shares 16,359,690.401 shares 208,280,708.050 shares | 90.696% 1.449% 7.855% | |||
Nationwide NVIT Investor Destinations Moderately Aggressive Fund (Formerly Gartmore GVIT Investor Destinations Moderately Aggressive Fund) | FOR AGAINST ABSTAIN TOTAL | 134,792,622.920 shares 3,489,207.264 shares 9,304,197.656 shares 147,586,027.840 shares | 91.332% 2.364% 6.304% | |||
Nationwide NVIT Investor Destinations Moderately Conservative Fund (Formerly Gartmore GVIT Investor Destinations Moderately Conservative Fund) | FOR AGAINST ABSTAIN TOTAL | 49,627,123.216 shares 856,088.634 shares 3,507,215.650 shares 53,990,427.500 shares | 91.918% 1.586% 6.496% | |||
Nationwide NVIT Mid Cap Growth Fund (Formerly Gartmore GVIT Mid Cap Growth Fund) | FOR AGAINST ABSTAIN TOTAL | 10,879,584.971 shares 352,594.958 shares 717,792.971 shares 11,949,972.900 shares | 91.043% 2.950% 6.007% | |||
Nationwide NVIT Money Market Fund II (Formerly Gartmore GVIT Money Market Fund II) | FOR AGAINST ABSTAIN TOTAL | 221,774,863.241 shares 12,322,482.494 shares 16,471,740.875 shares 250,569,086.610 shares | 88.508% 4.918% 6.574% | |||
Nationwide NVIT Money Market Fund (Formerly Gartmore GVIT Money Market Fund) | FOR AGAINST ABSTAIN TOTAL | 1,578,331,008.328 shares 32,372,133.671 shares 112,652,123.301 shares 1,723,355,265.300 shares | 91.585% 1.878% 6.537% | |||
NVIT Nationwide Fund (Formerly Gartmore GVIT NationwideFund) | FOR AGAINST ABSTAIN TOTAL | 125,423,274.735 shares 2,767,979.467 shares 8,762,255.828 shares 136,953,510.030 shares | 91.581% 2.021% 6.398% | |||
NVIT Nationwide Leaders Fund (Formerly Gartmore GVIT Nationwide Leaders Fund) | FOR AGAINST ABSTAIN TOTAL | 2,298,504.956 shares 29,630.469 shares 71,637.755 shares 2,399,773.180 shares | 95.780% 1.235% 2.985% |
Number of Shares | ||||||
Fund | Cast/Not Cast | Percentages | ||||
Nationwide NVIT U.S. Growth Leaders Fund (Formerly Gartmore GVIT U.S. Growth Leaders Fund) | FOR AGAINST ABSTAIN TOTAL | 4,972,094.773 shares 122,623.161 shares 174,625.606 shares 5,269,343.540 shares | 94.359% 2.327% 3.314% | |||
Gartmore NVIT Worldwide Leaders Fund (Formerly Gartmore GVIT Worldwide Leaders Fund) | FOR AGAINST ABSTAIN TOTAL | 2,666,862.487 shares 47,702.491 shares 118,719.882 shares 2,833,284.860 shares | 94.126% 1.684% 4.190% | |||
J.P. Morgan NVIT Balanced Fund (Formerly J.P. Morgan GVIT Balanced Fund) | FOR AGAINST ABSTAIN TOTAL | 15,966,867.546 shares 259,004.324 shares 1,339,385.200 shares 17,565,257.070 shares | 90.900% 1.475% 7.625% | |||
Van Kampen NVIT Comstock Value Fund (Formerly Van Kampen GVIT Comstock Value Fund) | FOR AGAINST ABSTAIN TOTAL | 27,737,008.009 shares 502,564.164 shares 1,824,670.107 shares 30,064,242.280 shares | 92.259% 1.672% 6.069% | |||
Van Kampen NVIT Multi Sector Bond Fund (Formerly Van Kampen GVIT Multi Sector Bond Fund) | FOR AGAINST ABSTAIN TOTAL | 21,253,297.665 shares 484,100.920 shares 1,803,963.645 shares 23,541,362.230 shares | 90.281% 2.056% 7.663% | |||
At the April 25 Meeting, shareholders of the Nationwide NVIT Mid Cap Growth Fund were also asked to approve a new investment subadvisory agreement among the Adviser, the Trust and NorthPointe Capital LLC. The voting results with respect to that proposal are set forth below:
Proposal 2
Number of Shares | ||||||
Fund | Cast/Not Cast | Percentages | ||||
Nationwide NVIT Mid Cap Growth Fund (Formerly Gartmore GVIT Mid Cap Growth Fund) | FOR AGAINST ABSTAIN TOTAL | 10,862,827.499 shares 414,574.660 shares 672,570.741 shares 11,949,972.900 shares | 90.903% 3.469% 5.628% | |||
* | This meeting was previously adjourned on April 23, 2007. | |
** | Fund names were changed effective May 1, 2007 to reflect “Nationwide”/ “NVIT” branding to coincide with the sale of Nationwide Fund Advisors, Inc. by Nationwide Corporation to its majority-owned subsidiary, Nationwide Financial Services, Inc. |
June 30, 2007 (Unaudited)
Contents | ||
6 | Statement of Investments | |
8 | Statement of Assets and Liabilities | |
9 | Statement of Operations | |
10 | Statements of Changes in Net Assets | |
11 | Financial Highlights | |
12 | Notes to Financial Statements |
Statement Regarding Availability of Proxy Voting Record.
SAR-MMKT2 (8/07) | ![]() |
Dear Fellow Shareholder:
Since I last wrote to you, our mutual funds have enjoyed another period of solid performance, and the corporate realignment that was in progress is now finished.
On May 1, 2007, Nationwide Financial Services, Inc. (NFS), completed its acquisition of the Philadelphia-based retail mutual fund operations of NWD Investment Management, Inc. (formerly, “Gartmore Global Investments, Inc.”), from Nationwide Corporation, a subsidiary of Nationwide Mutual Insurance Company. Effective that date, the acquired entities were renamed Nationwide Funds Group (NFG), and the Gartmore Funds were renamed the Nationwide Funds to better align with the Nationwide® brand. Although the corporate ownership and fund names have changed, I can assure you that NFG intends to maintain as much continuity as possible with the Funds and key personnel.
Thank you, shareholders, for approving the new investment advisory agreement that was required due to the change in corporate ownership. The new agreement is identical in all material respects to the original agreement that it replaces, with the exception of the section pertaining to the vote by the shareholders of the NVIT Mid Cap Growth Fund to approve NorthPointe Capital®, LLC (NorthPointe) as sub-adviser to that particular Fund.
Market Overview: January 1-June 30, 2007
Share prices in general were buoyed in part by better-than-expected first-quarter 2007 earnings and a flurry of mergers and acquisitions, many of these spurred by readily available funding from private equity firms. In June, investors grew more cautious amid surging crude oil prices, a sudden spike in long-term interest rates, and the meltdown of two hedge funds that had exposure to the subprime mortgage market. Looking abroad, a weak U.S. dollar aided foreign stocks, as reflected in the 11.09% advance of the Morgan Stanley Capital International Europe, Australasia and Far East (MSCI EAFE®) Index. Emerging market performance was particularly robust.
The bond market struggled during the first half of 2007. While short-term interest rates remained stable, reflecting the Federal Reserve Board’s decision in June to leave the target federal funds rate at 5.25%, longer-term rates climbed during the first half of 2007, depressing bond prices and forcing the Lehman Brothers® U.S. Aggregate Index to settle for a modest 0.97% return.
We at NFG thank you for your understanding and cooperation throughout our recent transition period. We emerge from this period energized for the future, and we look forward to serving your investment needs for a long time to come.
Nationwide Funds Group
PAST PERFORMANCE IS NO GUARANTEE OF FUTURE RESULTS.
Nationwide Funds are advised by Nationwide Fund Advisors (NFA). NFA is a wholly-owned subsidiary of Nationwide Financial Services. Nationwide Financial Services is a wholly-owned subsidiary of Nationwide Corporation. All of the common stock of Nationwide Corporation is held by Nationwide Mutual (95.2%) and Nationwide Mutual Fire Insurance Company (4.8%), each of which is a mutual company owned by its policyholders.
Nationwide Funds Group (NFG) is the mutual fund arm of Nationwide Financial Services (NYSE: NFS). Based in Conshohocken, Pa., a suburb of Philadelphia, NFG is comprised of Nationwide Fund Advisors, Nationwide Fund Distributors, LLC, and Nationwide Fund Management, LLC. Together, these provide advisory, distribution, and administration services respectively to the Nationwide Funds, and manage more than $43.5 billion in assets as of June 30, 2007, of which more than $12 billion are in “fund of funds” designed to provide asset allocation across several types of investments and asset classes.
Lehman Brothers (LB) U.S. Aggregate Index: An unmanaged, market value-weighted index of investment-grade, fixed-rate debt issues (including government, corporate, asset-backed, and mortgage-backed securities with maturities of one year or more) that is generally representative of the bond market as a whole.
Morgan Stanley Capital International Europe, Australasia and Far East (MSCI EAFE®) Index: An unmanaged, free float-adjusted, market capitalization-weighted index that is designed to measure the performance of stocks in developed markets outside the United States and Canada.
Standard & Poor’s 500® (S&P 500) Index: An unmanaged, market capitalization-weighted index of 500 widely held stocks of large-cap U.S. companies that gives a broad look at how the stock prices of those companies have performed.
Views expressed within are those of Nationwide Funds Group as of the date noted, are subject to change at any time, and may not come to pass.
This report is for informational purposes only, and is not intended as an offer or recommendation with respect to the purchase or sale of any security, option, future, or other derivatives in such securities.
Investing in mutual funds involves risk, including possible loss of principal.
Investors should carefully consider a fund’s investment objectives, risks, fees, charges, and expenses before investing any money. To obtain this and other fund information, please call 800-848-0920 to request a prospectus, or download a prospectus at www.nationwidefunds.com. Please read the prospectus carefully before investing any money.
Nationwide Funds distributed by Nationwide Fund Distributors LLC (formerly Gartmore Distribution Services, Inc.), Member NASD. 1200 River Road, Suite 1000, Conshohocken, Pa. 19428.
As a shareholder of the Fund, you incur two types of costs: (1) transaction costs, including sales charges (loads) paid on purchase payments and redemption fees; and (2) ongoing costs, including investment advisory fees, administration fees, distribution fees and other Fund expenses. The examples below are 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. Per SEC requirements, the examples assume that you had a $1,000 investment in the Class at the beginning of the reporting period, January 1, 2007, and continued to hold your shares at the end of the reporting period, June 30, 2007.
Actual Expenses
Hypothetical Example for Comparison Purposes
Please note that the expenses shown in the table are meant to highlight your ongoing costs only and do not reflect any transaction costs, such as sales charges (loads) or redemption fees. Therefore, the second line for each Class in 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 transaction costs were included, your costs would have been higher. The examples also assume all dividends and distributions have been reinvested.
Schedule of Shareholder Expenses
Nationwide NVIT Money Market II Fund | ||||||||||||||||||||||
Beginning | Ending | Expenses Paid | Annualized | |||||||||||||||||||
Account Value, | Account | During Period* | Expense Ratio* | |||||||||||||||||||
January 1, 2007 | Value, | |||||||||||||||||||||
June 30, 2007 | ||||||||||||||||||||||
Class I(a) | Actual | $ | 1,000.00 | $ | 1,021.90 | $ | 4.86 | 0.97% | ||||||||||||||
Hypothetical | 1 | $ | 1,000.00 | $ | 1,019.99 | $ | 4.87 | 0.97% | ||||||||||||||
(a) | The Money Market II Fund shares have no class designation. | |
* | Expenses are equal to the Fund’s annualized expense ratio multiplied by the average account value over the period multiplied by 181/365 (to reflect the one-half year period). The expense ratio presented represents a six-month, annualized ratio in accordance with SEC guidelines. The expenses reported above do not include the effect of additional expenses imposed by variable annuity contracts. | |
1 | Represents the hypothetical 5% return before expenses. |
Asset Allocation | ||||
Commercial Paper | 70.2% | |||
Asset-Backed Commercial Paper | 26.2% | |||
Other | 3.6% | |||
100.0% |
Top Holdings | ||||
UBS Finance LLC, 5.35%, 07/02/07 | 3.6% | |||
Stanfield Victoria Funding, 5.36%, 07/02/07 | 3.6% | |||
KBC Financial Products International Ltd., 5.37%, 07/02/07 | 3.6% | |||
Cargill, Inc., 5.37%, 07/02/07 | 3.6% | |||
Variable Funding Capital Corp., 5.37%, 07/02/07 | 3.6% | |||
Harrier Funding LLC, 5.38%, 07/02/07 | 3.6% | |||
Carrera Capital Finance LLC, 5.38%, 07/02/07 | 3.5% | |||
Three Rivers Funding Corp., 5.40%, 07/02/07 | 3.5% | |||
General Electric Capital Corp., 5.25%, 07/03/07 | 3.5% | |||
Abbey National N.A. LLC, 5.27%, 07/03/07 | 3.5% | |||
Other | 64.4% | |||
100.0% |
Top Industries | ||||
Banks—Foreign | 17.0% | |||
Asset-Backed—Trade & Term Receivables | 12.8% | |||
Financial Services | 11.5% | |||
Personal Credit Institutions | 9.8% | |||
Banks—Domestic | 8.7% | |||
Mortgage Bankers & Brokers | 5.2% | |||
Asset-Backed—Yankee | 3.5% | |||
Agricultural Services | 3.5% | |||
Asset-Backed—Domestic | 3.6% | |||
Asset-Backed—Residential Mortgages | 3.5% | |||
Other Assets | 20.9% | |||
100.0% |
Nationwide NVIT Money Market Fund II
Asset-Backed Commercial Paper (26.2%) | |||||||||
Shares or | |||||||||
Principal Amount | Value | ||||||||
Asset-Backed — Domestic (3.6%) | |||||||||
Harrier Funding LLC, 5.38%, 07/02/07 | $ | 10,000,000 | $ | 9,998,506 | |||||
Asset-Backed — Residential Mortgages (3.5%) | |||||||||
Carrera Capital Finance LLC, 5.38%, 07/02/07 | 10,000,000 | 9,998,506 | |||||||
Asset-Backed — Trade & Term Receivables (12.8%) (a) | |||||||||
Kittyhawk Funding Corp., 5.32%, 07/06/07 | 9,000,000 | 8,993,350 | |||||||
Old Line Funding Corp., 5.35%, 07/05/07 | 7,000,000 | 6,995,862 | |||||||
Three Rivers Funding Corp., 5.40%, 07/02/07 | 10,000,000 | 9,998,500 | |||||||
Variable Funding Capital Corp., 5.37%, 07/02/07 | 10,000,000 | 9,998,508 | |||||||
35,986,220 | |||||||||
Asset-Backed — Yankee (3.5%) | |||||||||
Stanfield Victoria Funding, 5.36%, 07/02/07 | 10,000,000 | 9,998,511 | |||||||
Asset-Backed CDO — Trust Preferred (2.8%) (a) | |||||||||
Lockhart Funding LLC | |||||||||
5.37%, 07/06/07 | 1,863,000 | 1,861,611 | |||||||
5.32%, 07/11/07 | 6,000,000 | 5,991,133 | |||||||
7,852,744 | |||||||||
Total Asset-Backed Commercial Paper (Cost $73,834,487) | 73,834,487 | ||||||||
Commercial Paper (70.2%) | |||||||||
Agricultural Services (3.5%) (a) | |||||||||
Cargill, Inc., 5.37%, 07/02/07 | 10,000,000 | 9,998,508 | |||||||
Banks — Domestic (8.7%) | |||||||||
Citicorp, Inc., 5.31%, 07/13/07 | 5,982,000 | 5,971,412 | |||||||
KBC Financial Products International Ltd., 5.37%, 07/02/07 (a) | 10,000,000 | 9,998,508 | |||||||
State Street Corp., 5.25%, 07/09/07 | 8,500,000 | 8,490,084 | |||||||
24,460,004 | |||||||||
Banks — Foreign (17.0%) | |||||||||
Abbey National N.A. LLC, 5.27%, 07/03/07 | 10,000,000 | 9,997,072 | |||||||
Bank Of Ireland (a) | |||||||||
5.38%, 07/10/07 | 690,000 | 689,072 | |||||||
5.33%, 07/13/07 | 7,000,000 | 6,987,563 | |||||||
Dresdner U.S. Finance, 5.30%, 07/03/07 | 7,000,000 | 6,997,939 | |||||||
National Australia Funding, 5.25%, 07/03/07 (a) | 4,286,000 | 4,284,751 | |||||||
Societe Generale, N.A., 5.35%, 07/05/07 | 9,000,000 | 8,994,650 | |||||||
UBS Finance LLC, 5.35%, 07/02/07 | 10,000,000 | 9,998,514 | |||||||
47,949,561 | |||||||||
Financial Services (11.5%) | |||||||||
Caterpillar Financial Svcs., 5.26%, 07/02/07 | 3,815,000 | 3,814,443 | |||||||
Fortis Funding LLC, 5.29%, 07/06/07 (a) | 9,000,000 | 8,993,387 | |||||||
ING U.S. Funding, 5.28%, 07/05/07 | 6,500,000 | 6,496,187 | |||||||
Prudential Funding, 5.26%, 07/03/07 | 7,000,000 | 6,997,954 | |||||||
Rabobank USA Finance Corp., 5.25%, 07/05/07 | 6,000,000 | 5,996,500 | |||||||
32,298,471 | |||||||||
Groceries and Related Products (1.7%) (a) | |||||||||
Sysco Corp., 5.27%, 07/03/07 | 4,700,000 | 4,698,624 | |||||||
Household Products (1.0%) (a) | |||||||||
Colgate-Palmolive Co., 5.24%, 07/10/07 | 2,800,000 | 2,796,332 | |||||||
Malt Beverages (2.6%) (a) | |||||||||
Anheuser Busch, 5.25%, 07/12/07 | 7,450,000 | 7,438,049 | |||||||
Mortgage Bankers & Brokers (5.2%) (a) | |||||||||
Nationwide Building Society | |||||||||
5.38%, 07/05/07 | 1,000,000 | 999,402 | |||||||
5.29%, 07/09/07 | 6,500,000 | 6,492,359 | |||||||
Northern Rock PLC, 5.30%, 07/11/07 | 7,070,000 | 7,059,439 | |||||||
14,551,200 | |||||||||
Commercial Paper (continued) | |||||||||
Shares or | |||||||||
Principal Amount | Value | ||||||||
Personal Credit Institutions (9.8%) | |||||||||
American General Finance Corp. | |||||||||
5.30%, 07/11/07 | $ | 5,000,000 | $ | 4,992,639 | |||||
5.28%, 07/13/07 | 2,800,000 | 2,795,072 | |||||||
General Electric Capital Corp., 5.25%, 07/03/07 | 10,000,000 | 9,997,083 | |||||||
Toyota Motor Credit Corp. | |||||||||
5.27%, 07/06/07 | 3,000,000 | 2,997,804 | |||||||
5.27%, 07/10/07 | 7,000,000 | 6,990,778 | |||||||
27,773,376 | |||||||||
Pharmaceutical Preparations (3.5%) (a) | |||||||||
Abbott Laboratories | |||||||||
5.24%, 07/02/07 | 6,000,000 | 5,999,127 | |||||||
5.30%, 07/10/07 | 1,500,000 | 1,498,012 | |||||||
5.28%, 07/13/07 | 2,500,000 | 2,495,600 | |||||||
9,992,739 | |||||||||
Retail (2.5%) (a) | |||||||||
Pitney-Bowes, Inc., 5.25%, 07/12/07 | 7,000,000 | 6,988,771 | |||||||
Short-Term Business Credit (3.2%) | |||||||||
American Express Credit Corp., 5.23%, 07/02/07 | 9,000,000 | 8,998,692 | |||||||
Total Commercial Paper (Cost $197,944,327) | 197,944,327 | ||||||||
Total Investments (Cost $271,778,814) (b) — 96.4% | 271,778,814 | ||||||||
Other assets in excess of liabilities — 3.6% | 10,247,720 | ||||||||
NET ASSETS — 100.0% | $ | 282,026,534 | |||||||
(a) | Denotes a restricted security that may be resold without restriction to “qualified institutional buyers” as defined by Rule 144A under the Securities Act of 1933 and that the Fund has determined to be liquid under criteria established by the Fund’s Board of Trustees. | |
(b) | See notes to financial statements for tax unrealized appreciation (depreciation) of securities. |
See accompanying notes to financial statements.
Nationwide NVIT | ||||||
Money | ||||||
Market Fund II | ||||||
Assets: | ||||||
Investments, at value (cost $271,778,814) | $ | 271,778,814 | ||||
Cash | 16,826 | |||||
Receivable for capital shares issued | 10,461,632 | |||||
Total Assets | 282,257,272 | |||||
Liabilities: | ||||||
Accrued expenses and other payables: | ||||||
Investment advisory fees | 112,820 | |||||
Fund administration and transfer agent fees | 11,532 | |||||
Distribution fees | 56,410 | |||||
Administrative servicing fees | 16,897 | |||||
Other | 33,079 | |||||
Total Liabilities | 230,738 | |||||
Net Assets | $ | 282,026,534 | ||||
Represented by: | ||||||
Capital | $ | 282,024,246 | ||||
Accumulated net investment income | 2,332 | |||||
Accumulated net realized losses from investment transactions | (44 | ) | ||||
Net Assets | $ | 282,026,534 | ||||
Shares outstanding (unlimited number of shares authorized): | ||||||
Shares outstanding (unlimited number of shares authorized): | 282,024,245 | |||||
Net asset value and offering price per share (Net assets by class divided by shares outstanding by class, respectively.): | $ | 1.00 | ||||
8
Nationwide NVIT | |||||
Money | |||||
Market Fund II | |||||
INVESTMENT INCOME: | |||||
Interest income | $ | 6,860,447 | |||
Dividend income | 167,314 | ||||
Total Income | 7,027,761 | ||||
Expenses: | |||||
Investment advisory fees | 658,392 | ||||
Fund administration and transfer agent fees | 79,006 | ||||
Distribution fees | 329,196 | ||||
Administrative servicing fees | 172,128 | ||||
Compliance program costs (Note 3) | 1,574 | ||||
Other | 37,014 | ||||
Net Expenses | 1,277,310 | ||||
Net Investment Income | 5,750,451 | ||||
CHANGE IN NET ASSETS RESULTING FROM OPERATIONS | $ | 5,750,451 | |||
9
Nationwide NVIT Money Market Fund II | |||||||||
Six Months Ended | Year Ended | ||||||||
June 30, 2007 | December 31, 2006 | ||||||||
(Unaudited) | |||||||||
FROM INVESTMENT ACTIVITIES: | |||||||||
Operations: | |||||||||
Net investment income | $ | 5,750,451 | $ | 12,538,719 | |||||
Net realized gains (losses) on investment transactions | – | (43 | ) | ||||||
Change in net assets resulting from operations | 5,750,451 | 12,538,676 | |||||||
Distributions to shareholders from: | |||||||||
Net investment income: | |||||||||
Fund level | (5,750,451 | ) | (12,538,719 | ) | |||||
Change in net assets from capital transactions | 49,882,459 | (28,412,429 | ) | ||||||
Change in net assets | 49,882,459 | (28,412,472 | ) | ||||||
Net Assets: | |||||||||
Beginning of period | 232,144,075 | 260,556,547 | |||||||
End of period | $ | 282,026,534 | $ | 232,144,075 | |||||
Accumulated net investment income at end of period | $ | 2,332 | $ | 2,332 | |||||
CAPITAL TRANSACTIONS: | |||||||||
Fund level | |||||||||
Proceeds from shares issued | $ | 986,363,110 | $ | 1,404,717,440 | |||||
Dividends reinvested | 5,750,450 | 12,538,356 | |||||||
Cost of shares redeemed | (942,231,101 | ) | (1,445,668,225 | ) | |||||
49,882,459 | (28,412,429 | ) | |||||||
Change in net assets from capital transactions | $ | 49,882,459 | $ | (28,412,429 | ) | ||||
SHARE TRANSACTIONS: | |||||||||
Fund level | |||||||||
Issued | 986,363,110 | 1,404,717,424 | |||||||
Reinvested | 5,750,450 | 12,538,356 | |||||||
Redeemed | (942,231,101 | ) | (1,445,668,211 | ) | |||||
49,882,459 | (28,412,431 | ) | |||||||
Total change in shares | 49,882,459 | (28,412,431 | ) | ||||||
10
Investment Activities | ||||||||||||
Net Asset | Total | |||||||||||
Value, | Net | from | ||||||||||
Beginning | Investment | Investment | ||||||||||
of Period | Income | Activities | ||||||||||
For the year ended December 31, 2002 | $ | 1.00 | 0.01 | 0.01 | ||||||||
For the year ended December 31, 2003 | $ | 1.00 | (e | ) | (e | ) | ||||||
For the year ended December 31, 2004 | $ | 1.00 | (e | ) | (e | ) | ||||||
For the year ended December 31, 2005 | $ | 1.00 | 0.02 | 0.02 | ||||||||
For the year ended December 31, 2006 | $ | 1.00 | 0.04 | 0.04 | ||||||||
For the six months ended June 30, 2007 (Unaudited) | $ | 1.00 | 0.02 | 0.02 | ||||||||
[Additional columns below]
[Continued from above table, first column(s) repeated]
Distributions | ||||||||||||||||||||||||
Ratios/Supplemental Data | ||||||||||||||||||||||||
Ratio of | ||||||||||||||||||||||||
Net Assets | Expenses to | |||||||||||||||||||||||
Net | Net Asset | at End of | Average | |||||||||||||||||||||
Investment | Total | Value, End | Total | Period | Net | |||||||||||||||||||
Income | Distributions | of Period | Return (a) | (000s) | Assets (b) | |||||||||||||||||||
For the year ended December 31, 2002 | (0.01 | ) | (0.01 | ) | $ | 1.00 | 0.70% | $ | 110,041 | 0.99% | ||||||||||||||
For the year ended December 31, 2003 | (e | ) | (e | ) | $ | 1.00 | 0.18% | $ | 147,736 | 0.95% | ||||||||||||||
For the year ended December 31, 2004 | (e | ) | (e | ) | $ | 1.00 | 0.41% | $ | 192,820 | 0.96% | ||||||||||||||
For the year ended December 31, 2005 | (0.02 | ) | (0.02 | ) | $ | 1.00 | 2.26% | $ | 260,557 | 1.01% | ||||||||||||||
For the year ended December 31, 2006 | (0.04 | ) | (0.04 | ) | $ | 1.00 | 4.11% | $ | 232,144 | 1.01% | ||||||||||||||
For the six months ended June 30, 2007 (Unaudited) | (0.02 | ) | (0.02 | ) | $ | 1.00 | 2.19% | $ | 282,027 | 0.97% | ||||||||||||||
[Additional columns below]
[Continued from above table, first column(s) repeated]
Ratios/Supplemental Data | ||||||||||||||
Ratio of Net | ||||||||||||||
Ratio of Net | Ratio of | Investment | ||||||||||||
Investment | Expenses | Income | ||||||||||||
Income | (Prior to | (Prior to | ||||||||||||
to Average | Reimbursements) | Reimbursements) | ||||||||||||
Net | to Average | to Average | ||||||||||||
Assets (b) | Net Assets (b)(c) | Net Assets (b)(c) | ||||||||||||
For the year ended December 31, 2002 | 0.66% | 0.99% | 0.66% | |||||||||||
For the year ended December 31, 2003 | 0.17% | 0.99% | 0.13% | |||||||||||
For the year ended December 31, 2004 | 0.43% | 0.99% | 0.40% | |||||||||||
For the year ended December 31, 2005 | 2.24% | (d) | (d) | |||||||||||
For the year ended December 31, 2006 | 4.06% | (d) | (d) | |||||||||||
For the six months ended June 30, 2007 (Unaudited) | 4.37% | (d) | (d) | |||||||||||
(a) | Not annualized for periods less than one year. | |
(b) | Annualized for periods less than one year. | |
(c) | During the period, certain fees were waived and/or reimbursed. If such waivers/reimbursements had not occurred, the ratios would have been as indicated. | |
(d) | There were no fee reductions during the period. | |
(e) | The amount is less than $0.005 per share. |
See accompanying notes to financial statements.
1. Organization
Nationwide Variable Insurance Trust (“NVIT” or the “Trust”) is an open-end management investment company, organized under the laws of Delaware by an amended and restated Agreement and Declaration of Trust, dated October 28, 2004, as amended to date. Prior to May 1, 2007, the Trust was named “Gartmore Variable Insurance Trust”. The Trust, originally created under the laws of Massachusetts as a Massachusetts business trust pursuant to a Declaration of Trust dated, as of June 30, 1981, and as subsequently amended, redomesticated as a Delaware Statutory Trust after the close of trading on April 29, 2005, and is registered under the Investment Company Act of 1940, as amended (the “1940 Act”). The redomestication was a change in statutory status and did not affect the operations of the Trust. As of June 30, 2007, the Trust had authorized an unlimited number of shares of beneficial interest, without par value (“shares”). The Trust currently offers shares to life insurance company separate accounts to fund the benefits under variable life insurance or annuity policies. To date, only the separate accounts of Nationwide Life Insurance Company and Nationwide Life and Annuity Insurance Company (collectively, “Nationwide”) have purchased shares of the Nationwide NVIT Money Market II Fund (the “Fund”), (formerly, “Gartmore GVIT Money Market II Fund”). The Trust currently operates forty (40) separate series, or mutual funds, each with its own investment objectives and strategies. This report contains the financial statements and financial highlights of the Fund.
2. Summary of Significant Accounting Policies
The following is a summary of significant accounting policies followed by the Fund in the preparation of its financial statements. The policies are in conformity with accounting principles generally accepted in the United States of America (“GAAP”). The preparation of financial statements requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of income and expenses for the period. Actual results could differ from those estimates.
(a) | Security Valuation |
Investments of the Fund are valued at amortized cost, which approximates market value. Under the amortized cost method, premium or discount, if any, is amortized or accreted, respectively, on a constant (straight-line) basis to the maturity of the security. | |
The Fund values foreign securities at fair value in the circumstances described below. Generally, trading in foreign securities markets is completed each day at various times prior to the Valuation Time. Due to the time differences between the closings of the relevant foreign securities exchanges and the Valuation Time for the Fund, the Fund will fair value its foreign investments when it is determined that the market quotations for the foreign investments either are not readily available or are unreliable and, therefore, do not represent fair value. When the fair value prices are utilized, these prices will attempt to reflect the impact of the U.S. financial markets’ perceptions and trading activities on the Fund’s foreign investments since the last closing prices of the foreign investments were calculated on their primary foreign securities markets or exchanges. For these purposes, the Trust’s Board of Trustees (“Board of Trustees”) has determined that movements in relevant indices or other appropriate market indicators, after the close of the foreign securities exchanges, may demonstrate that market quotations are unreliable, and may trigger fair value pricing for certain securities. Consequently, fair valuation of portfolio securities may occur on a daily basis. |
(b) | Repurchase Agreements |
The Fund may enter into repurchase agreements with an entity which is a member of the Federal Reserve System or which is a “primary dealer” (as designated by the Federal Reserve Bank of New York) in U.S. Government obligations. The repurchase price generally equals the price paid by the Fund plus interest negotiated on the basis of current short-term rates, which may be more or less than the rate on the underlying portfolio securities. The seller under a repurchase agreement is required to maintain the value of the collateral held pursuant to the agreement at a market value equal to or greater than the repurchase price (including accrued interest). Collateral subject to repurchase agreements is held by the Fund’s custodian or another qualified sub-custodian or in the Federal Reserve/ |
Treasury book-entry system. If the counterparty defaults and the fair value of the collateral declines, realization of the collateral by the Fund may be delayed or limited. The Fund may transfer uninvested cash balances into a pooled cash account. These balances are invested in one or more repurchase agreements, with the counterparty of Nomura Securities, which is fully collateralized by U.S. Government Agency Mortgages. |
(c) | Security Transactions and Investment Income |
Security transactions are accounted for on the date the security is purchased or sold (“trade date”). Securities gains and losses are calculated on the identified cost basis. Interest income is recognized on the accrual basis and includes, where applicable, the amortization or accretion of premium or discount. |
(d) | Distributions to Shareholders |
The Fund’s dividends from net investment income, if any, are declared daily and paid monthly. The Fund’s distributions from net realized capital gains, if any, are declared and distributed at least annually. | |
Dividends and distributions to shareholders are determined in accordance with federal income tax regulations, which may differ from GAAP. These “book/tax” differences are considered either permanent or temporary in nature. In accordance with the American Institute of Certified Public Accountants Statement of Position 93-2, permanent differences (i.e., reclassification of market discounts, foreign exchange gain/loss, paydowns, and distributions from real estate investment trusts) are reclassified within the capital accounts based on their nature for federal income tax purposes; temporary differences do not require reclassification. These reclassifications have no effect upon the net asset value of the Fund. To the extent distributions exceed current and accumulated earnings and profits for federal income tax purposes, these distributions are reported as distributions of paid-in-capital. |
(e) | Federal Income Taxes |
It is the policy of the Fund to qualify or to continue to qualify as a “regulated investment company” by complying with the provisions available to certain investment companies, as defined in Subchapter M of the U.S. Internal Revenue Code, and to make distributions of net investment income and net realized capital gains sufficient to relieve the Fund from all, or substantially all, federal income taxes. | |
As of June 30, 2007, the tax cost of securities and the breakdown of unrealized appreciation (depreciation) for the Fund was as follows: |
Net Unrealized | ||||||||||||||||
Tax Cost of | Unrealized | Unrealized | Appreciation | |||||||||||||
Securities | Appreciation | Depreciation | (Depreciation) | |||||||||||||
$ | 271,778,814 | $ | – | $ | – | $ | – | |||||||||
(f) | Allocation of Expenses, Income, and Gains and Losses |
Expenses directly attributable to the Fund are charged to the Fund. Expenses not directly attributable to the Fund are allocated proportionately among various or all funds within the Trust. The method used by the Fund for allocating income, fund level expenses, and realized and unrealized gains or losses is based on the fair value of settled shares outstanding. Under this method, earnings are allocated based on the fair value of settled shares. Expenses specific to a class (such as administrative services fees) are charged to that class. |
3. Transactions with Affiliates
Under the terms of the Trust’s Investment Advisory Agreement, Nationwide Fund Advisors (formerly, Gartmore Mutual Fund Capital Trust (“GMF”)) (“NFA” or the “Advisor”) manages the investment of the assets and supervises the daily business affairs of the Fund. NFA is a wholly-owned subsidiary of Nationwide Financial Services (“NFS”).
Under the terms of the Investment Advisory Agreement, the Fund pays NFA an investment advisory fee based on the Fund’s average daily net assets and the following schedule:
Fee Schedule | Fees | |||||
Up to $1 billion | 0.50% | |||||
Next $1 billion | 0.48% | |||||
Next $3 billion | 0.46% | |||||
$5 billion or more | 0.44% | |||||
Under the terms of a Fund Administration and Transfer Agency Agreement, Nationwide Fund Management, LLC ((formerly, Gartmore Investor Services, Inc. (“GISI”)) (“NFM”), a wholly-owned subsidiary of NFS Distributors, Inc. (“NFSDI”), provides the Fund with various administrative and accounting services for the Fund (prior to May 1, 2007, this service was provided by Gartmore SA Capital Trust (“GSA”)), and serves as Transfer and Dividend Disbursing Agent for the Fund (prior to May 1, 2007, this service was provided by GISI, an indirect subsidiary of GSA.) The fees for the services provided under this Agreement are calculated based on the Trust’s average daily net assets according to the fee schedule below. The fees are then allocated proportionately among all funds within the Trust in relation to the average daily net assets of each fund and are paid to NFA. NFA pays NFM from these fees for NFM’s services.
Combined Fee Schedule* | ||||||
Up to $1 billion | 0.15% | |||||
$1 billion up to $3 billion | 0.10% | |||||
$3 billion up to $8 billion | 0.05% | |||||
$8 billion up to $10 billion | 0.04% | |||||
$10 billion up to $12 billion | 0.02% | |||||
$12 billion or more | 0.01% | |||||
* | The assets of the Nationwide NVIT Investor Destinations Aggressive Fund, the Nationwide NVIT Investor Destinations Moderately Aggressive Fund, the Nationwide NVIT Investor Destinations Moderate Fund, the Nationwide NVIT Investor Destinations Moderately Conservative Fund, and the Nationwide NVIT Investor Destinations Conservative Fund (collectively, the “Investor Destinations Funds”) are excluded from the Trust asset level amount in order to calculate this asset-based fee. The Investor Destinations Funds do not pay any part of this fee. |
NFA and NFM have entered into agreements with Citi Fund Services Ohio, Inc. (“Citi”), pursuant to which Citi provides sub-administration and sub-transfer agency services, respectively, to the Fund. Effective August 1, 2007, The BISYS Group Inc. was acquired by and became a wholly owned subsidiary of Citi.
Under the terms of a Distribution Plan under Rule 12b-1 of the 1940 Act, Nationwide Fund Distributors, LLC. (formerly, “Gartmore Distribution Services, Inc.”) (“NFD” or “Distributor”), the Fund’s principal underwriter, is compensated by the Fund for expenses associated with the distribution of the shares of the Fund. NFD is a majority-owned subsidiary of NFSDI. These fees are based on average daily net assets of the Fund at an annual rate not to exceed 0.25%.
Under the terms of an Administrative Services Plan, the Fund may pay fees to servicing organizations, such as broker-dealers, including NFS, and financial institutions, which agree to provide administrative support services to the shareholders of certain classes. These services include, but are not limited, to the following: establishing and maintaining shareholder accounts; processing purchase and redemption transactions; arranging bank wires; performing shareholder sub-accounting; answering inquires regarding the Fund; and other such services. These fees are based on an annual rate of up to 0.25% of the average daily net assets of the Fund.
For the six months ended June 30, 2007, NFS received $198,874 in Administrative Services Fees from the Fund.
Under the terms of a letter agreement dated September 12, 2006, by and among NFA, the Audit Committee of the Trust and the Trust, the Trust has agreed to reimburse NFA certain costs related to the Fund’s portion of ongoing administration, monitoring and annual (audit) testing of the Trust’s Rule 38a-1 Compliance Program subject to the pre-approval of the Trust’s Audit Committee. For the six months ended June 30, 2007, the Fund’s portion as such costs amounted to $1,574.
4. Investment Transactions
For the six months ended June 30, 2007, the Fund had short-term purchases of $58,113,308 of U.S. Government securities.
5. Bank Loans and Earnings Credit
The Trust has a credit agreement with JPMorgan Chase & Co., the Fund’s custodian bank, permitting the Trust to borrow up to $100,000,000. Borrowings under this arrangement bear interest at the Federal Funds rate plus 0.50%. The interest costs, if any, would be included in other fees in the Statement of Operations. No compensating balances were required under the terms of the line of credit. The line of credit is renewed annually, expiring on June 25, 2008, with a commitment fee of 0.07% per year on $100,000,000. There were no borrowings outstanding under this line of credit for the six months ended June 30, 2007.
The Trust’s custodian bank has agreed to reduce the bank’s fees (earnings credit) when the funds of the Trust maintain cash on deposit in non-interest-bearing custody and Demand Deposit Accounts. Earnings credits, if any, are shown as a reduction of total expenses on the Statement of Operations.
6. Portfolio Investment Risks
Risks Associated with Foreign Securities and Currencies. Investments in securities of foreign issuers carry certain risks not ordinarily associated with investments in securities of U.S. issuers. These risks include future political and economic developments, and the possible imposition of exchange controls or other foreign governmental laws and restrictions. In addition, with respect to certain countries, there is the possibility of expropriation of assets, confiscatory taxation, political or social instability, or diplomatic developments, which could adversely affect investments in those countries.
Certain countries also may impose substantial restrictions on investments in their capital markets by foreign entities, including restrictions on investments in issuers of industries deemed sensitive to relevant national interests. These factors may limit the investment opportunities available and result in a lack of liquidity and high price volatility with respect to securities of issuers from developing countries.
7. Indemnifications
Under the Trust’s organizational documents, the Trust’s Officers and Trustees are indemnified against certain liabilities arising out of the performance of their duties to the Trust. In addition, the Trust has entered into Indemnification Agreements with the Trust’s trustees and certain officers covering similar liabilities. Trust Officers receive no compensation from the Trust for serving as the Trust’s Officers. In addition, in the normal course of business, the Trust enters into contracts with its vendors and others that provide for general indemnifications. The Trust’s maximum exposure under these arrangements is unknown, as this would involve future claims that may be made against the Trust. Based on experience, however, the Trust expects that risk of loss to be remote.
8. Recently Issued Accounting Pronouncements
On July 13, 2006, the Financial Accounting Standards Board (“FASB”) released FASB Interpretation No. 48, Accounting for Uncertainty in Income Taxes (“FIN 48”). FIN 48 provides guidance for how uncertain tax positions should be recognized, measured, presented and disclosed in the financial statements. FIN 48 requires the affirmative evaluation of tax positions taken or expected to be taken in the course of preparing the Fund’s tax returns to determine whether it is more-likely-than-not (i.e., greater than 50 percent) that each tax position will be sustained upon examination by a taxing
In September 2006, the FASB issued Statement on Financial Accounting Standards (“SFAS”) No. 157, “Fair Value Measurements.” This standard establishes a single authoritative definition of fair value, sets out a framework for measuring fair value and requires additional disclosures about fair value measurements. SFAS No. 157 applies to fair value measurements already required or permitted by existing standards. SFAS No. 157 is effective for financial statements issued for fiscal years beginning after November 15, 2007 and interim periods within those fiscal years. The changes to current accounting principles generally accepted in the United States of America from the application of this Statement relate to the definition of fair value, the methods used to measure fair value, and the expanded disclosures about fair value measurements. As of June 30, 2007, the Fund does not believe the adoption of SFAS No. 157 will impact the financial statement amounts; however, additional disclosures may be required about the inputs used to develop the measurements and the effect of certain of the measurements on changes in net assets for the period.
Trustees who are not Interested Persons (as defined in the 1940 Act) and Officers of the Trust as of
Number of Portfolios | ||||||||||
Position(s) Held | in the | |||||||||
with the Trust | Principal Occupation(s) | Nationwide Fund | Other | |||||||
Name, Address | and Length of | During Past | Complex Overseen | Directorships | ||||||
and Year of Birth | Time Served1 | Five Years | by Trustee | Held by Trustee2 | ||||||
Charles E. Allen c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1948 | Trustee since July 2000 | Mr. Allen is Chairman, Chief Executive Officer and President of Graimark Realty Advisors, Inc. (real estate development, investment and asset management). | 89 | None | ||||||
Paula H.J. Cholmondeley c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1947 | Trustee since July 2000 | Ms. Cholmondeley was Vice President and General Manager of Sappi Fine Paper North America from April 2000 through December 2003. | 89 | Director of Dentsply International, Inc. (dental products), Ultralife Batteries, Inc., Terex Corporation (construction equipment), Minerals Technology, Inc. (specialty chemicals) and Albany International Corp. (paper industry) | ||||||
C. Brent DeVore3 c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1940 | Trustee since 1990 | Dr. DeVore is President of Otterbein College. | 89 | None | ||||||
Phyllis Kay Dryden c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1947 | Trustee since December 2004 | Ms. Dryden was a partner of Mitchell Madison, a management consulting company from January 2006 until December 2006; she is currently a consultant with the company. Ms. Dryden was formerly Managing Partner of march FIRST, a global management consulting firm. | 89 | None | ||||||
Barbara L. Hennigar c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1935 | Trustee since July 2000 | Retired. | 89 | None | ||||||
Number of Portfolios | ||||||||||
Position(s) Held | in the | |||||||||
with the Trust | Principal Occupation(s) | Nationwide Fund | Other | |||||||
Name, Address | and Length of | During Past | Complex Overseen | Directorships | ||||||
and Year of Birth | Time Served1 | Five Years | by Trustee | Held by Trustee2 | ||||||
Barbara I. Jacobs c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1950 | Trustee since December 2004 | Ms. Jacobs served as Chairman of the Board of Directors of KICAP Network Fund, a European (United Kingdom) hedge fund, from January 2001 through January 2006. From 1998-2003, Ms. Jacobs was also a Managing Director and European Portfolio Manager of CREF Investments (Teachers Insurance and Annuity Association-College Retirement Equities Fund). | 89 | None | ||||||
Douglas F. Kridler c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1955 | Trustee since September 1997 | Mr. Kridler has served as the President and Chief Executive Officer of the Columbus Foundation (a Columbus, OH-based foundation which manages over 1,300 individual endowment funds) since February 2002. Prior to January 31, 2002, Mr. Kridler was the President of the Columbus Association for the Performing Arts and Chairman of the Greater Columbus Convention and Visitors Bureau. | 89 | None | ||||||
Michael D. McCarthy c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1947 | Trustee since December 2004 | Retired. Mr. McCarthy was Chairman of VMAC (commodity swaps) from October 2002 until January 2007; and a partner of Pineville Properties LLC (a commercial real estate development firm) from September 2000 until January 2007. | 89 | None | ||||||
David C. Wetmore c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1948 | Trustee since 1995 and Chairman since February 2005 | Retired. | 89 | None | ||||||
1 | Length of time served includes time served with the Trust’s predecessors. | |
2 | Directorships held in (1) any other investment companies registered under the 1940 Act, (2) any company with a class of securities registered pursuant to Section 12 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or (3) any company subject to the requirements of Section 15(d) of the Exchange Act. | |
3 | Mr. DeVore has served as President of Otterbein College since 1984. Mark Thresher, President and Chief Operating Officer of Nationwide Financial Services, Inc. (“NFS”) has served as a member of the Board of Trustees of Otterbein College since 2000, currently serves as one of 30 of its trustees, and is currently one of two Vice Chairmen of the Board. Each of Nationwide Fund Advisors (“NFA”), the Funds’ investment adviser, and Nationwide Fund Distributors LLC (“NFD”), principal underwriter to the Trust, is a wholly-owned subsidiary of NFS. | |
Additional information regarding the Trustees and Officers may be found in the Trust’s Statement of Additional Information, which is available without charge upon request, by calling 800-848-0920. |
Trustees who are Interested Persons (as defined in the 1940 Act) and/or Officers of the Trust as of
Number of Portfolios | ||||||||||
Position(s) Held | in the | |||||||||
with the Trust | Principal Occupation(s) | Nationwide Fund | Other | |||||||
Name, Address | and Length of | During Past | Complex Overseen | Directorships | ||||||
and Year of Birth | Time Served1 | 5 Years | by Trustee | Held by Trustee 2 | ||||||
Arden L. Shisler c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1941 | Trustee since February 2000 | Retired. Mr. Shisler is the former President and Chief Executive Officer of KeB Transport, Inc., a trucking firm (2000 through 2002). He served as a consultant to KeB from January 2003 through December 2004. Since 1992, Mr. Shisler has also been Chairman of the Board for Nationwide Mutual Insurance Company.3 | 89 | Director of Nationwide Financial Services, Inc., Chairman of Nationwide Mutual Insurance Company3 | ||||||
John H. Grady Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1961 | President & Chief Executive Officer since December 2006 | Mr. Grady is President, and Chief Executive Officer of Nationwide Funds Group which includes Nationwide Fund Advisors,3 Nationwide Fund Management LLC,3 Nationwide Fund Distributors LLC 3 and NWD Investments,2 the asset management operations of Nationwide Mutual Insurance Company, which includes Morley Capital Management, Inc.,2 Nationwide Separate Accounts LLC,2 NorthPointe Capital LLC,2 and Nationwide SA Capital Trust2. From March 2004 until March 2006, Mr. Grady was Chief Executive Officer of Constellation Investment Management Co., L.P. (registered investment adviser), and President and Chief Executive Officer of Constellation Funds Group (registered investment companies). He also was President of Constellation Investment Distribution Co., Inc. (registered broker-dealer) from March 2004 until June 2006. From February 2001 until February 2004, Mr. Grady was Chief Operating and Chief Legal Officer; Managing Director, Mutual Funds Group, Turner Investment Partners, Inc. (registered investment adviser); Executive Vice President of Turner Funds and Turner Institutional Portfolios (registered investment companies); and President, Turner Investment Distributors, Inc. (registered broker-dealer). | N/A | None | ||||||
Gerald J. Holland Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1951 | Treasurer since March 2001 | Mr. Holland is Senior Vice President—Operations for Nationwide Funds Group3. | N/A | N/A | ||||||
Number of Portfolios | ||||||||||
Position(s) Held | in the | |||||||||
with the Trust | Principal Occupation(s) | Nationwide Fund | Other | |||||||
Name, Address | and Length of | During Past | Complex Overseen | Directorships | ||||||
and Year of Birth | Time Served1 | 5 Years | by Trustee | Held by Trustee 2 | ||||||
Michael A. Krulikowski Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1959 | Chief Compliance Officer from June 2004 to August 20074 | Mr. Krulikowski is Vice President and Chief Compliance Officer of Nationwide Funds Group3, Morley Capital Management, Inc.3, Nationwide SA Capital Trust (since 1999)3, and Nationwide Separate Accounts LLC (since August 2005).3 Since June 2004, Mr. Krulikowski has also served as Chief Compliance Officer of the Trust. From November 1999 through May 2007, he served as Vice President and Chief Compliance Officer of NorthPointe Capital LLC. 3 | N/A | N/A | ||||||
Eric E. Miller Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1953 | Secretary since December 2002 | Mr. Miller is Senior Vice President, General Counsel, and Assistant Secretary for Nationwide Funds Group3 and NWD Investments.2 From August 2000 to August 2002, Mr. Miller was a Partner with Stradley Ronon Stevens & Young, LLP. | N/A | N/A | ||||||
1 | Length of time served includes time served with the Trust’s predecessors. | |
2 | Directorships held in (1) any other investment companies registered under the 1940 Act, (2) any company with a class of securities registered pursuant to Section 12 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or (3) any company subject to the requirements of Section 15(d) of the Exchange Act. | |
3 | This position is held with an affiliated person or principal underwriter of the Trust. | |
4 | Effective August 3, 2007, the Board of Trustees approved Carol Baldwin Moody as Chief Compliance Officer of the Trust. Since November 2005, Ms. Moody has been Senior Vice President, Chief Compliance Officer of Nationwide Financial Services, Nationwide Life Insurance Company, Nationwide Life and Annuity Insurance Company, and Nationwide Investment Advisors, LLC. From February 2004-November 2005, she was Chief Compliance Officer of TIAA-CREF and from April 2000-February 2004, she was Managing Director and General Counsel, TCW/ Latin America Partners, LLC and Baeza & Co., LLC. | |
Federal law requires the Trust, each of its investment advisers and sub-advisers to adopt procedures for voting proxies (“Proxy Voting Guidelines”) and to provide a summary of those Proxy Voting Guidelines used to vote the securities held by the Funds. The Funds’ proxy voting policies and procedures are available without charge (i) upon request, by calling 800-848-0920, (ii) on the Funds’ website at www.nationwidefunds.com, or (iii) on the Securities and Exchange Commission’s website at www.sec.gov. |
A. Renewal of Investment Advisory Agreement
(i) General Information Regarding the Board’s Review of Investment Advisory Agreements
The Trust’s investment advisory agreements (each an “Advisory Agreement”) with its investment adviser and, as applicable, sub-advisers (together, the “Adviser”) must be approved for an initial term no greater than two years, and renewed at least annually thereafter, (i) by the vote of the Trustees or by a vote of the shareholders of each series or fund of the Trust (individually a “Fund” ), and (ii) by the vote of a majority of the Trustees who are not parties to the Advisory Agreement or “interested persons” of any party thereto (the “Independent Trustees”) cast in person at a meeting called for the purpose of voting on such approval.
The Board meets quarterly and takes into account throughout the year matters bearing on each Fund’s Advisory Agreement. The Board and its standing committees consider at each meeting factors that are relevant to the annual renewal of an Advisory Agreement, including the services and support provided to a Fund and its shareholders.
On December 6, 2006, the Independent Trustees first met in person with their independent legal counsel (“Independent Legal Counsel”) to consider information provided by the Adviser and others to assist the Trustees in considering whether to renew each Fund’s Advisory Agreement for a one year term beginning May 1, 2007. Immediately following such meeting of the Independent Trustees, all Trustees met in person with the Adviser, Trust counsel, Independent Legal Counsel and others to consider such matters, and give preliminary consideration to information bearing on continuation of each Advisory Agreement. The primary purpose of the December 6 and 7, 2006 meeting was to ensure that the Trustees had ample opportunity to consider matters they deemed relevant in considering the continuation of an Advisory Agreement, and to request any additional information they considered reasonably necessary to their deliberations.
In preparation for the December 6 and 7, 2006 meeting the Trustees were provided, at the request of the Trustees, with a wide range of information to assist in their deliberations, including (i) reports from Lipper Inc. describing a Fund’s (a) performance rankings (where “first quintile” denotes the best performance) (over multiple years ended September 30, 2006) compared with performance groups and performance universes created by Lipper (and in some cases, customized peer groups created by the Adviser) of similar or peer group funds, and (b) expense rankings (where “first quintile” denotes the lowest fees and expenses) comparing the Fund’s contractual advisory fee and total expenses with expense groups and expense universes created by Lipper of similar or peer group funds, (ii) information from the Adviser describing the Fund’s performance (over multiple years ended September 30, 2006) compared with its benchmark and Lipper categories, (iii) for Funds under “close review,” copies of letters from the Adviser to the portfolio manager of each such Fund, together with the portfolio manager’s written response describing the reasons for the Fund’s underperformance (iv) information from the Adviser describing performance for the months of October and November, 2006, and annual performance for the year ended November 30, 2006, (v) reports from the Adviser describing the Adviser’s profitability in providing services under an Advisory Agreement, together with an explanation of Adviser’s methodology in calculating its profitability, (vi) information from the Adviser describing any fees paid to the Adviser for managing similar, non-affiliated institutional accounts, including the range of fee levels for such accounts, and (vii) information from the Adviser describing ancillary benefits, in addition to fees for serving as investment adviser, derived by the Adviser as a result of being investment adviser for a Fund, including, where applicable, information on soft-dollar benefits and fees inuring to the Adviser’s affiliates for serving as the Trust’s administrator, fund accountant and transfer agent.
At the December 6 and 7, 2006 meeting, the Trustees reviewed, considered and discussed, among themselves and with the Adviser, Trust counsel and Independent Legal Counsel, among other things, the information described above, and: (i) the nature, extent and quality of services provided by the Adviser under each Advisory Agreement, (ii) the investment performance of each Fund and the Adviser, (iii) the costs of the services provided by the Adviser under the Advisory Agreement and the profits realized by the Adviser thereunder, (iv) the extent to which economies of scale may be present and, if so, whether they are being shared with a Fund’s shareholders, (v) comparisons of the Adviser’s fees under the Advisory Agreement with investment advisory fees paid by peer group funds to their investment advisers and paid by non-affiliated institutional clients to the Adviser for managing similar accounts, and (vi) any ancillary benefits inuring to the Adviser and its affiliates as a result of being investment adviser for the Trust. The Trustees also considered, where
As part of the December 6 and 7, 2006 Board meeting, the Independent Trustees developed a list of follow-up matters and questions and asked that Adviser respond to such matters and questions at the contract approval meeting of the Board of Trustees to be held on January 11, 2007.
At the January 11, 2007 meeting of the Board of Trustees of the Trust, the Board received and considered information provided by the Adviser in follow-up from the December 6 and 7, 2006 Board meeting and, after consulting among themselves, and with the Adviser, Trust counsel and Independent Legal Counsel, concluded unanimously to renew the Advisory Agreement for the reasons set forth in the following section. In determining whether to renew the Advisory Agreement for the Fund, the Board ultimately reached a determination, with the assistance of Trust counsel and Independent Legal Counsel, that the renewal of the Advisory Agreement and the compensation to be received by the Adviser under the Advisory Agreement is consistent with the Board’s fiduciary duty under applicable law.
(ii) Board Conclusions Regarding the Fund’s Advisory Agreement
The Board considered that the Fund had underperformed its benchmark, the iMoney Net First Tier Index, for the one-and three-year periods. The Board also considered that the performance of the Fund’s Class I shares had ranked in the fifth quintile of the Fund’s Lipper-constructed Performance group over the one-, two-, three-, and four-year periods. The Board found that the Fund had performed in line with expectations. Based on its review, the Board concluded that the nature, extend, and quality of the services provided to the Fund will benefit the Fund’s shareholders.
The Board considered that the Fund’s contractual advisory fee and breakpoints placed the Fund in the fourth quintile of its Lipper-constructed Expense Group and the Fund’s total expenses placed the Fund in the fifth quintile. The Board found that the Fund’s contractual advisory fee compared with its peer group was relatively high, but within the range of the fees charged by its peer group. The Board concluded that the Fund’s management fee and total expenses were fair and reasonable in light of the services the Fund receives and the other factors discussed.
The Board considered that the Fund’s adviser reported a pre-tax profit margin for investment management services for during the twelve month-periods ended September 30, 2006 and 2005. The Board also considered the costs of the services provided and the amounts of the profits realized by the adviser and determined the amount of profit is a fair entrepreneurial profit for management of the Fund.
Based upon its evaluation of all of the conclusions noted above, and after considering all material factors with respect to the Fund, the Board ultimately concluded that the advisory fee structure is fair and reasonable, and that the Advisory Agreement (and, if applicable, Sub-Advisory Agreement) with respect to the Fund, should be renewed.
B. Approval of New Advisory Agreement
At its January 11, 2007 meeting, the Board also unanimously approved a new investment advisory agreement (the “New Agreement”) for the Fund with Nationwide Fund Advisors, (“NFA”) the then-current adviser to each of the series of the Trust to become effective upon the closing of the acquisition of NFA by Nationwide Financial Services, Inc. (“NFS”) from Nationwide Corporation (“NWC”) which closed on April 30, 2007 (the “Transaction”). In approving the New Agreement, the Board considered NFA’s capacity to continue to provide the services needed to operate a sophisticated investment management business and to support the management of each of the series. The Board also took into account the information provided to them at their regular quarterly meetings with NFA’s senior management with respect to the Fund, including the information provided by management at the Fund’s annual Section 15(c) meetings on December 6-7, 2006 and January 11, 2007. In addition, the Board also considered NFS’ announced intentions, over time, that NFA will operate exclusively as “manager of managers” in which NFA, rather than managing a series directly, will instead oversee one or more subadvisers who will provide day-to-day portfolio management to each series. The Board also
C. Submission of Matters to a Vote of Security Holders:
On April 25, 2007, a Special Meeting of Shareholders was held* (the “April 25 Meeting”) at which shareholders of the Funds** set forth below were asked:
Proposal 1:
To approve a new investment advisory agreement, on behalf of their Fund, between Nationwide Fund Advisors (formerly “Gartmore Mutual Fund Capital Trust”) (the “Adviser”) and Nationwide Variable Insurance Trust (formerly “Gartmore Variable Insurance Trust”) (the “Trust”).
Number of Shares | ||||||
Fund | Cast/Not Cast | Percentages | ||||
Federated NVIT High Income Bond Fund (Formerly Federated GVIT High Income Bond Fund) | FOR AGAINST ABSTAIN TOTAL | 30,051,703.188 shares 618,245.021 shares 1,813,550.431 shares 32,483,498.640 shares | 92.514% 1.903% 5.583% | |||
NVIT International Index Fund (Formerly GVIT International Index Fund) | FOR AGAINST ABSTAIN TOTAL | 4,322,203.982 shares 2,758.318 shares 135,636.840 shares 4,460,599.140 shares | 96.897% 0.062% 3.041% | |||
NVIT International Value Fund (Formerly GVIT International Value Fund) | FOR AGAINST ABSTAIN TOTAL | 20,032,843.199 shares 333,588.902 shares 1,093,293.879 shares 21,459,725.980 shares | 93.351% 1.554% 5.095% | |||
NVIT Mid Cap Index Fund (Formerly GVIT Mid Cap Index Fund) | FOR AGAINST ABSTAIN TOTAL | 35,380,179.120 shares 631,117.844 shares 1,565,714.306 shares 37,577,011.270 shares | 94.154% 1.679% 4.167% | |||
NVIT S&P 500 Index Fund (Formerly GVIT S&P 500 Index Fund) | FOR AGAINST ABSTAIN TOTAL | 56,119,814.230 shares 666,195.542 shares 1,944,898.888 shares 58,730,908.660 shares | 95.554% 1.134% 3.312% |
Number of Shares | ||||||
Fund | Cast/Not Cast | Percentages | ||||
Nationwide Multi-Manager NVIT Small Cap Growth Fund (Formerly GVIT Small Cap Growth Fund) | FOR AGAINST ABSTAIN TOTAL | 7,632,918.513 shares 149,458.111 shares 451,583.036 shares 8,233,959.660 shares | 92.700% 1.816% 5.484% | |||
Nationwide Multi-Manager NVIT Small Cap Value Fund (Formerly GVIT Small Cap Value Fund) | FOR AGAINST ABSTAIN TOTAL | 48,649,396.525 shares 979,183.753 shares 2,786,133.102 shares 52,414,713.380 shares | 92.816% 1.868% 5.316% | |||
Nationwide Multi-Manager NVIT Small Company Fund (Formerly GVIT Small Company Fund) | FOR AGAINST ABSTAIN TOTAL | 29,903,181.700 shares 838,774.923 shares 2,006,741.307 shares 32,748,697.930 shares | 91.311% 2.561% 6.128% | |||
Gartmore NVIT Developing Markets Fund (Formerly Gartmore GVIT Developing Markets Fund) | FOR AGAINST ABSTAIN TOTAL | 21,0177,889.443 shares 424,272.958 shares 1,543,850.729 shares 23,046,013.130 shares | 91.460% 1.841% 6.699% | |||
Gartmore NVIT Emerging Markets Fund (Formerly Gartmore GVIT Emerging Markets Fund) | FOR AGAINST ABSTAIN TOTAL | 17,050,534.593 shares 526,574.722 shares 881,608.905 shares 18,458,718.220 shares | 92.371% 2.853% 4.776% | |||
Nationwide NVIT Global Financial Services Fund (Formerly Gartmore GVIT Global Financial Services Fund) | FOR AGAINST ABSTAIN TOTAL | 1,554,847.333 shares 19,539.033 shares 52,206.494 shares 1,626,592.860 shares | 95.589% 1.201% 3.210% | |||
Nationwide NVIT Global Health Sciences Fund (Formerly Gartmore GVIT Global Health Sciences Fund) | FOR AGAINST ABSTAIN TOTAL | 4,722,963.678 shares 157,979.030 shares 207,642.222 shares 5,088,584.930 shares | 92.815% 3.104% 4.081% | |||
Nationwide NVIT Global Technology and Communications Fund (Formerly Gartmore GVIT Global Technology and Communications Fund) | FOR AGAINST ABSTAIN TOTAL | 8,585,472.039 shares 102,267.977 shares 489,577.634 shares 9,177,317.650 shares | 93.551% 1.114% 5.335% | |||
Gartmore NVIT Global Utilities Fund (Formerly Gartmore GVIT Global Utilities Fund) | FOR AGAINST ABSTAIN TOTAL | 4,123,270.549 shares 122,001.533 shares 240,276.088 shares 4,485,548.170 shares | 91.923% 2.720% 5.357% | |||
Nationwide NVIT Government Bond Fund (Formerly Gartmore GVIT Government Bond Fund) | FOR AGAINST ABSTAIN TOTAL | 88,471,567.462 shares 1,825,645.181 shares 5,841,990.727 shares 96,139,203.370 shares | 92.024% 1.899% 6.077% | |||
Nationwide NVIT Growth Fund (Formerly Gartmore GVIT Growth Fund) | FOR AGAINST ABSTAIN TOTAL | 14,931,435.904 shares 409,826.402 shares 1,259,945.064 shares 16,601,207.370 shares | 89.942% 2.469% 7.589% |
Number of Shares | ||||||
Fund | Cast/Not Cast | Percentages | ||||
Gartmore NVIT International Growth Fund (Formerly Gartmore GVIT International Growth Fund) | FOR AGAINST ABSTAIN TOTAL | 6,251,419.070 shares 139,618.548 shares 290,025.592 shares 6,681,063.210 shares | 93.569% 2.090% 4.341% | |||
Nationwide NVIT Investor Destinations Aggressive Fund (Formerly Gartmore GVIT Investor Destinations Aggressive Fund) | FOR AGAINST ABSTAIN TOTAL | 49,489,224.549 shares 1,385,396.474 shares 3,696,272.337 shares 54,570,893.360 shares | 90.688% 2.539% 6.773% | |||
Nationwide NVIT Investor Destinations Conservative Fund (Formerly Gartmore GVIT Investor Destinations Conservative Fund) | FOR AGAINST ABSTAIN TOTAL | 23,091,965.887 shares 314,935,884 shares 2,292,355.179 shares 25,699,256.950 shares | 89.855% 1.225% 8.920% | |||
Nationwide NVIT Investor Destinations Moderate Fund (Formerly Gartmore GVIT Investor Destinations Moderate Fund) | FOR AGAINST ABSTAIN TOTAL | 188,902,093.059 shares 3,018,924.590 shares 16,359,690.401 shares 208,280,708.050 shares | 90.696% 1.449% 7.855% | |||
Nationwide NVIT Investor Destinations Moderately Aggressive Fund (Formerly Gartmore GVIT Investor Destinations Moderately Aggressive Fund) | FOR AGAINST ABSTAIN TOTAL | 134,792,622.920 shares 3,489,207.264 shares 9,304,197.656 shares 147,586,027.840 shares | 91.332% 2.364% 6.304% | |||
Nationwide NVIT Investor Destinations Moderately Conservative Fund (Formerly Gartmore GVIT Investor Destinations Moderately Conservative Fund) | FOR AGAINST ABSTAIN TOTAL | 49,627,123.216 shares 856,088.634 shares 3,507,215.650 shares 53,990,427.500 shares | 91.918% 1.586% 6.496% | |||
Nationwide NVIT Mid Cap Growth Fund (Formerly Gartmore GVIT Mid Cap Growth Fund) | FOR AGAINST ABSTAIN TOTAL | 10,879,584.971 shares 352,594.958 shares 717,792.971 shares 11,949,972.900 shares | 91.043% 2.950% 6.007% | |||
Nationwide NVIT Money Market Fund II (Formerly Gartmore GVIT Money Market Fund II) | FOR AGAINST ABSTAIN TOTAL | 221,774,863.241 shares 12,322,482.494 shares 16,471,740.875 shares 250,569,086.610 shares | 88.508% 4.918% 6.574% | |||
Nationwide NVIT Money Market Fund (Formerly Gartmore GVIT Money Market Fund) | FOR AGAINST ABSTAIN TOTAL | 1,578,331,008.328 shares 32,372,133.671 shares 112,652,123.301 shares 1,723,355,265.300 shares | 91.585% 1.878% 6.537% | |||
NVIT Nationwide Fund (Formerly Gartmore GVIT NationwideFund) | FOR AGAINST ABSTAIN TOTAL | 125,423,274.735 shares 2,767,979.467 shares 8,762,255.828 shares 136,953,510.030 shares | 91.581% 2.021% 6.398% | |||
NVIT Nationwide Leaders Fund (Formerly Gartmore GVIT Nationwide Leaders Fund) | FOR AGAINST ABSTAIN TOTAL | 2,298,504.956 shares 29,630.469 shares 71,637.755 shares 2,399,773.180 shares | 95.780% 1.235% 2.985% |
Number of Shares | ||||||
Fund | Cast/Not Cast | Percentages | ||||
Nationwide NVIT U.S. Growth Leaders Fund (Formerly Gartmore GVIT U.S. Growth Leaders Fund) | FOR AGAINST ABSTAIN TOTAL | 4,972,094.773 shares 122,623.161 shares 174,625.606 shares 5,269,343.540 shares | 94.359% 2.327% 3.314% | |||
Gartmore NVIT Worldwide Leaders Fund (Formerly Gartmore GVIT Worldwide Leaders Fund) | FOR AGAINST ABSTAIN TOTAL | 2,666,862.487 shares 47,702.491 shares 118,719.882 shares 2,833,284.860 shares | 94.126% 1.684% 4.190% | |||
J.P. Morgan NVIT Balanced Fund (Formerly J.P. Morgan GVIT Balanced Fund) | FOR AGAINST ABSTAIN TOTAL | 15,966,867.546 shares 259,004.324 shares 1,339,385.200 shares 17,565,257.070 shares | 90.900% 1.475% 7.625% | |||
Van Kampen NVIT Comstock Value Fund (Formerly Van Kampen GVIT Comstock Value Fund) | FOR AGAINST ABSTAIN TOTAL | 27,737,008.009 shares 502,564.164 shares 1,824,670.107 shares 30,064,242.280 shares | 92.259% 1.672% 6.069% | |||
Van Kampen NVIT Multi Sector Bond Fund (Formerly Van Kampen GVIT Multi Sector Bond Fund) | FOR AGAINST ABSTAIN TOTAL | 21,253,297.665 shares 484,100.920 shares 1,803,963.645 shares 23,541,362.230 shares | 90.281% 2.056% 7.663% | |||
At the April 25 Meeting, shareholders of the Nationwide NVIT Mid Cap Growth Fund were also asked to approve a new investment subadvisory agreement among the Adviser, the Trust and NorthPointe Capital LLC. The voting results with respect to that proposal are set forth below:
Proposal 2
Number of Shares | ||||||
Fund | Cast/Not Cast | Percentages | ||||
Nationwide NVIT Mid Cap Growth Fund (Formerly Gartmore GVIT Mid Cap Growth Fund) | FOR AGAINST ABSTAIN TOTAL | 10,862,827.499 shares 414,574.660 shares 672,570.741 shares 11,949,972.900 shares | 90.903% 3.469% 5.628% | |||
* | This meeting was previously adjourned on April 23, 2007. | |
** | Fund names were changed effective May 1, 2007 to reflect “Nationwide”/ “NVIT” branding to coincide with the sale of Nationwide Fund Advisors, Inc. by Nationwide Corporation to its majority-owned subsidiary, Nationwide Financial Services, Inc. |
June 30, 2007 (Unaudited)
Contents | ||
6 | Statement of Investments | |
24 | Statement of Assets and Liabilities | |
25 | Statement of Operations | |
26 | Statements of Changes in Net Assets | |
28 | Financial Highlights | |
30 | Notes to Financial Statements |
Statement Regarding Availability of Proxy Voting Record.
SAR-SCO (8/07) | ![]() |
Dear Fellow Shareholder:
Since I last wrote to you, our mutual funds have enjoyed another period of solid performance, and the corporate realignment that was in progress is now finished.
On May 1, 2007, Nationwide Financial Services, Inc. (NFS), completed its acquisition of the Philadelphia-based retail mutual fund operations of NWD Investment Management, Inc. (formerly, “Gartmore Global Investments, Inc.”), from Nationwide Corporation, a subsidiary of Nationwide Mutual Insurance Company. Effective that date, the acquired entities were renamed Nationwide Funds Group (NFG), and the Gartmore Funds were renamed the Nationwide Funds to better align with the Nationwide® brand. Although the corporate ownership and fund names have changed, I can assure you that NFG intends to maintain as much continuity as possible with the Funds and key personnel.
Thank you, shareholders, for approving the new investment advisory agreement that was required due to the change in corporate ownership. The new agreement is identical in all material respects to the original agreement that it replaces, with the exception of the section pertaining to the vote by the shareholders of the NVIT Mid Cap Growth Fund to approve NorthPointe Capital®, LLC (NorthPointe) as sub-adviser to that particular Fund.
Market Overview: January 1-June 30, 2007
Share prices in general were buoyed in part by better-than-expected first-quarter 2007 earnings and a flurry of mergers and acquisitions, many of these spurred by readily available funding from private equity firms. In June, investors grew more cautious amid surging crude oil prices, a sudden spike in long-term interest rates, and the meltdown of two hedge funds that had exposure to the subprime mortgage market. Looking abroad, a weak U.S. dollar aided foreign stocks, as reflected in the 11.09% advance of the Morgan Stanley Capital International Europe, Australasia and Far East (MSCI EAFE®) Index. Emerging market performance was particularly robust.
The bond market struggled during the first half of 2007. While short-term interest rates remained stable, reflecting the Federal Reserve Board’s decision in June to leave the target federal funds rate at 5.25%, longer-term rates climbed during the first half of 2007, depressing bond prices and forcing the Lehman Brothers® U.S. Aggregate Index to settle for a modest 0.97% return.
We at NFG thank you for your understanding and cooperation throughout our recent transition period. We emerge from this period energized for the future, and we look forward to serving your investment needs for a long time to come.
Nationwide Funds Group
PAST PERFORMANCE IS NO GUARANTEE OF FUTURE RESULTS.
Nationwide Funds are advised by Nationwide Fund Advisors (NFA). NFA is a wholly-owned subsidiary of Nationwide Financial Services. Nationwide Financial Services is a wholly-owned subsidiary of Nationwide Corporation. All of the common stock of Nationwide Corporation is held by Nationwide Mutual (95.2%) and Nationwide Mutual Fire Insurance Company (4.8%), each of which is a mutual company owned by its policyholders.
Nationwide Funds Group (NFG) is the mutual fund arm of Nationwide Financial Services (NYSE: NFS). Based in Conshohocken, Pa., a suburb of Philadelphia, NFG is comprised of Nationwide Fund Advisors, Nationwide Fund Distributors, LLC, and Nationwide Fund Management, LLC. Together, these provide advisory, distribution, and administration services respectively to the Nationwide Funds, and manage more than $43.5 billion in assets as of June 30, 2007, of which more than $12 billion are in “fund of funds” designed to provide asset allocation across several types of investments and asset classes.
Lehman Brothers (LB) U.S. Aggregate Index: An unmanaged, market value-weighted index of investment-grade, fixed-rate debt issues (including government, corporate, asset-backed, and mortgage-backed securities with maturities of one year or more) that is generally representative of the bond market as a whole.
Morgan Stanley Capital International Europe, Australasia and Far East (MSCI EAFE®) Index: An unmanaged, free float-adjusted, market capitalization-weighted index that is designed to measure the performance of stocks in developed markets outside the United States and Canada.
Standard & Poor’s 500® (S&P 500) Index: An unmanaged, market capitalization-weighted index of 500 widely held stocks of large-cap U.S. companies that gives a broad look at how the stock prices of those companies have performed.
Views expressed within are those of Nationwide Funds Group as of the date noted, are subject to change at any time, and may not come to pass.
This report is for informational purposes only, and is not intended as an offer or recommendation with respect to the purchase or sale of any security, option, future, or other derivatives in such securities.
Investing in mutual funds involves risk, including possible loss of principal.
Investors should carefully consider a fund’s investment objectives, risks, fees, charges, and expenses before investing any money. To obtain this and other fund information, please call 800-848-0920 to request a prospectus, or download a prospectus at www.nationwidefunds.com. Please read the prospectus carefully before investing any money.
Nationwide Funds distributed by Nationwide Fund Distributors LLC (formerly Gartmore Distribution Services, Inc.), Member NASD. 1200 River Road, Suite 1000, Conshohocken, Pa. 19428.
As a shareholder of the Fund, you incur two types of costs: (1) transaction costs, including sales charges (loads) paid on purchase payments and redemption fees; and (2) ongoing costs, including investment advisory fees, administration fees, distribution fees and other Fund expenses. The examples below are 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. Per SEC requirements, the examples assume that you had a $1,000 investment in the Class at the beginning of the reporting period, January 1, 2007, and continued to hold your shares at the end of the reporting period, June 30, 2007.
Actual Expenses
Hypothetical Example for Comparison Purposes
Please note that the expenses shown in the table are meant to highlight your ongoing costs only and do not reflect any transaction costs, such as sales charges (loads) or redemption fees. Therefore, the second line for each Class in 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 transaction costs were included, your costs would have been higher. The examples also assume all dividends and distributions have been reinvested.
Schedule of Shareholder Expenses
Nationwide Multi-Manager NVIT | ||||||||||||||||||||||
Small Company Fund | ||||||||||||||||||||||
Beginning | Ending | Expenses Paid | Annualized | |||||||||||||||||||
Account Value, | Account | During Period* | Expense Ratio* | |||||||||||||||||||
January 1, 2007 | Value, | |||||||||||||||||||||
June 30, 2007 | ||||||||||||||||||||||
Class I | Actual | $ | 1,000.00 | $ | 1,093.40 | $ | 6.07 | 1.17% | ||||||||||||||
Hypothetical | 1 | $ | 1,000.00 | $ | 1,019.00 | $ | 5.87 | 1.17% | ||||||||||||||
Class II | Actual | $ | 1,000.00 | $ | 1,092.20 | $ | 7.31 | 1.41% | ||||||||||||||
Hypothetical | 1 | $ | 1,000.00 | $ | 1,017.81 | $ | 7.08 | 1.41% | ||||||||||||||
Class III | Actual | $ | 1,000.00 | $ | 1,092.90 | $ | 6.28 | 1.21% | ||||||||||||||
Hypothetical | 1 | $ | 1,000.00 | $ | 1,018.80 | $ | 6.07 | 1.21% | ||||||||||||||
Class IV | Actual | $ | 1,000.00 | $ | 1,093.40 | $ | 6.07 | 1.17% | ||||||||||||||
Hypothetical | 1 | $ | 1,000.00 | $ | 1,019.00 | $ | 5.87 | 1.17% | ||||||||||||||
* | Expenses are equal to the Fund’s annualized expense ratio multiplied by the average account value over the period multiplied by 181/365 (to reflect the one-half year period). The expense ratio presented represents a six-month, annualized ratio in accordance with SEC guidelines. The expenses reported above do not include the effect of additional expenses imposed by variable annuity contracts. | |
1 | Represents the hypothetical 5% return before expenses. |
Asset Allocation | ||||
Common Stock | 97.4% | |||
Cash Equivalents | 1.9% | |||
Mutual Funds | 0.3% | |||
Commercial Paper | 0.1% | |||
Exchange Traded Funds | 0.1% | |||
Other assets in excess of liabilities | 0.2% | |||
100.0% |
Top Holdings | ||||
AIM Liquid Assets Portfolio, 5.09%, 04/01/42 | 1.9% | |||
Gaylord Entertainment Co. | 1.0% | |||
Blackboard, Inc. | 0.8% | |||
Bucyrus International, Inc. | 0.7% | |||
Chicago Bridge & Iron Co. | 0.7% | |||
Morningstar, Inc. | 0.7% | |||
Vail Resorts, Inc. | 0.6% | |||
Strayer Education, Inc. | 0.6% | |||
Blue Nile, Inc. | 0.6% | |||
Equinix, Inc. | 0.6% | |||
Other | 91.8% | |||
100.0% |
Top Industries | ||||
Commercial Services & Supplies | 6.1% | |||
Hotels, Restaurants & Leisure | 4.5% | |||
Oil, Gas & Consumable Fuels | 3.8% | |||
Health Care Equipment & Supplies | 3.8% | |||
Software | 3.7% | |||
Real Estate Investment Trusts (REITs) | 3.5% | |||
Metals & Mining | 3.5% | |||
Machinery | 3.5% | |||
Specialty Retail | 2.9% | |||
Insurance | 2.7% | |||
Other | 62.0% | |||
100.0% |
Top Countries | ||||
United States | 75.3% | |||
Japan | 6.1% | |||
United Kingdom | 3.1% | |||
Netherlands | 1.7% | |||
Bermuda | 1.5% | |||
Germany | 1.4% | |||
Australia | 1.2% | |||
Hong Kong | 1.1% | |||
Canada | 0.9% | |||
France | 0.8% | |||
Other | 6.9% | |||
100.0% |
Nationwide Multi-Manager NVIT Small Company Fund
Common Stock (97.4%) | ||||||||
Shares or | ||||||||
Principal Amount | Value | |||||||
AUSTRALIA (1.2%) | ||||||||
Building Products (0.1%) | ||||||||
Crane Group Ltd. | 30,233 | $ | 431,710 | |||||
Commercial Bank (0.1%) | ||||||||
Adelaide Bank Ltd. | 47,688 | 615,455 | ||||||
Commercial Services & Supplies (0.2%) | ||||||||
Cabcharge Australia Ltd. | 88,709 | 931,526 | ||||||
Downer EDI Ltd. | 159,857 | 995,959 | ||||||
1,927,485 | ||||||||
Gas Utility (0.1%) | ||||||||
Australian Pipeline Trust | 124,802 | 442,979 | ||||||
Health Care Providers & Services (0.1%) | ||||||||
Healthscope Ltd. | 166,070 | 734,172 | ||||||
Hotels, Restaurants & Leisure (0.0%) | ||||||||
Flight Centre Ltd. | 18,394 | 298,526 | ||||||
Media (0.0%) | ||||||||
Southern Cross Broadcasting (Australia) Ltd. | 27,787 | 375,800 | ||||||
Metals & Mining (0.1%) | ||||||||
Allegiance Mining Nl* | 622,744 | 417,601 | ||||||
Mincor Resources Nl | 210,268 | 833,732 | ||||||
1,251,333 | ||||||||
Multiline Retail (0.2%) | ||||||||
David Jones Ltd. | 441,633 | 2,079,480 | ||||||
Paper & Forest Products (0.1%) | ||||||||
Great Southern Plantations Ltd. | 153,077 | 388,226 | ||||||
Real Estate Investment Trust (REIT) (0.0%) | ||||||||
Tishman Speyer Office Fund | 82,240 | 164,797 | ||||||
Real Estate Management & Development (0.0%) | ||||||||
Fkp Ltd. | 59,204 | 365,673 | ||||||
Specialty Retail (0.1%) | ||||||||
Just Group Ltd. | 332,326 | 1,236,212 | ||||||
Transportation Infrastructure (0.1%) | ||||||||
Australian Infrastructure Fund | 225,551 | 627,852 | ||||||
10,939,700 | ||||||||
AUSTRIA (0.2%) | ||||||||
Energy Equipment & Services (0.0%) | ||||||||
Schoeller-Blackman Oilfield Equipment AG | 7,466 | 516,894 | ||||||
Machinery (0.1%) | ||||||||
Andritz AG | 13,108 | 863,158 | ||||||
Pharmaceutical (0.1%) | ||||||||
Intercell AG* | 27,690 | 892,108 | ||||||
2,272,160 | ||||||||
BELGIUM (0.4%) | ||||||||
Communications Equipment (0.1%) | ||||||||
Evs Broadcast Equipment SA | 6,171 | 506,541 | ||||||
Diversified Financial Services (0.1%) | ||||||||
GMV NV (b) | 9,630 | 698,458 | ||||||
Metals & Mining (0.1%) | ||||||||
Cumerio | 35,361 | 1,463,575 | ||||||
Transportation (0.1%) | ||||||||
Compagnie Maritime Belge SA | 11,499 | 802,598 | ||||||
3,471,172 | ||||||||
BERMUDA (1.5%) | ||||||||
Capital Markets (0.1%) | ||||||||
Macquarie International Infrastructure Fund Ltd. | 493,000 | 361,151 | ||||||
Construction & Engineering (0.2%) | ||||||||
Foster Wheeler Ltd.* | 18,841 | 2,015,799 | ||||||
Consumer Goods (0.0%) | ||||||||
Helen of Troy Ltd. - BM* | 3,227 | 87,129 | ||||||
Insurance (0.5%) | ||||||||
American Safety Insurance Group* | 4,946 | 117,863 | ||||||
Aspen Insurance Holdings Ltd. - BM | 63,870 | 1,792,831 | ||||||
Endurance Specialty Holdings Ltd. | 42,511 | 1,702,140 | ||||||
IPC Holdings Ltd. - BM | 21,100 | 681,319 | ||||||
4,294,153 | ||||||||
Internet & Catalog Retail (0.3%) | ||||||||
VistaPrint Ltd. - BM* | 72,930 | 2,789,572 | ||||||
Marine (0.2%) | ||||||||
Jinhui Shipping & Transportation Ltd.* | 222,073 | 2,052,676 | ||||||
Metals & Mining (0.2%) | ||||||||
Aquarius Platinum Ltd. | 61,680 | 1,925,151 | ||||||
13,525,631 | ||||||||
BRAZIL (0.3%) | ||||||||
Construction & Engineering (0.3%) | ||||||||
Gafisa SA BR* | 78,751 | 2,457,031 | ||||||
Common Stock (continued) | ||||||||
Shares or | ||||||||
Principal Amount | Value | |||||||
CANADA (0.9%) | ||||||||
Chemicals (0.2%) | ||||||||
Agrium, Inc. | 36,600 | $ | 1,601,250 | |||||
Commercial Services & Supplies (0.2%) | ||||||||
Ritchie Brothers Auctioneers, Inc. | 26,000 | 1,628,120 | ||||||
Electronic Equipment & Instruments (0.2%) | ||||||||
Novatel, Inc.* | 48,000 | 1,742,400 | ||||||
Media (0.1%) | ||||||||
Lions Gate Entertainment Corp.* | 80,926 | 892,614 | ||||||
Metals & Mining (0.1%) | ||||||||
Gammon Gold, Inc.* | 30,400 | 383,648 | ||||||
Novagold Resources, Inc.* | 41,200 | 619,236 | ||||||
1,002,884 | ||||||||
Oil, Gas & Consumable Fuels (0.0%) | ||||||||
Highpine Oil & Gas Ltd.* | 29,900 | 400,062 | ||||||
Pharmaceuticals (0.0%) | ||||||||
Axcan Pharma, Inc.* | 6,509 | 125,819 | ||||||
Biovail Corp. International ADR | 3,350 | 85,157 | ||||||
210,976 | ||||||||
Software (0.1%) | ||||||||
Corel Corp. ADR-CA* | 39,238 | 519,903 | ||||||
7,998,209 | ||||||||
CAYMAN ISLANDS (0.3%) | ||||||||
Internet Software & Services (0.3%) | ||||||||
Ctrip.com International Ltd. ADR | 38,217 | 3,005,003 | ||||||
CHINA (0.1%) | ||||||||
Manufacturing (0.0%) | ||||||||
China Special Steel Holdings Company Ltd. | 886,000 | 353,629 | ||||||
Transportation Infrastructure (0.1%) | ||||||||
Anhui Expressway Co. Ltd. | 524,000 | 441,080 | ||||||
794,709 | ||||||||
DENMARK (0.2%) | ||||||||
Beverages (0.0%) | ||||||||
Royal Unibrew AS | 2,617 | 365,300 | ||||||
Commercial Banks (0.1%) | ||||||||
Amagerbanken AS | 3,301 | 210,537 | ||||||
Roskilde Bank | 1,574 | 183,325 | ||||||
393,862 | ||||||||
Marine (0.0%) | ||||||||
D/ S Norden AS | 3,720 | 239,678 | ||||||
Pharmaceutical (0.1%) | ||||||||
Bavarian Nordic AS* | 5,750 | 542,866 | ||||||
1,541,706 | ||||||||
FINLAND (0.1%) | ||||||||
Communications Equipment (0.0%) | ||||||||
Elcoteq Network Corp. | 28,136 | 238,269 | ||||||
Pharmaceutical (0.1%) | ||||||||
Orion OYJ | 35,400 | 885,829 | ||||||
1,124,098 | ||||||||
FRANCE (0.8%) | ||||||||
Commercial Services & Supplies (0.2%) | ||||||||
CFF Recycling | 18,167 | 1,345,329 | ||||||
Communications Equipment (0.0%) | ||||||||
Wavecom SA* | 11,933 | 420,370 | ||||||
Hotels, Restaurants & Leisure (0.1%) | ||||||||
Pierre & Vacances | 6,377 | 971,270 | ||||||
Household Durables (0.1%) | ||||||||
Kaufman & Broad SA | 13,754 | 1,064,096 | ||||||
Insurance (0.2%) | ||||||||
Scor SA | 52,096 | 1,413,997 | ||||||
IT Services (0.0%) | ||||||||
Groupe Steria SCA | 3,628 | 240,485 | ||||||
Machinery (0.1%) | ||||||||
Haulotte Group | 22,523 | 931,714 | ||||||
Manufacturing (0.1%) | ||||||||
Bacou-Dalloz | 5,225 | 794,152 | ||||||
7,181,413 | ||||||||
GERMANY (1.4%) | ||||||||
Aerospace & Defense (0.2%) | ||||||||
Mtu Aero Engines Holding AG | 32,111 | 2,087,663 | ||||||
Communications Equipment (0.1%) | ||||||||
Drillisch AG* | 38,563 | 439,169 | ||||||
Consumer Finance (0.4%) | ||||||||
Arques Industries AG | 55,872 | 2,398,939 | ||||||
Deutsche Beteiligungs AG | 29,165 | 1,186,444 | ||||||
3,585,383 | ||||||||
IT Services (0.0%) | ||||||||
Bechtle AG | 9,948 | 364,866 | ||||||
Nationwide Multi-Manager NVIT Small Company Fund (Continued)
Common Stock (continued) | ||||||||
Shares or | ||||||||
Principal Amount | Value | |||||||
GERMANY (continued) | ||||||||
Leisure Equipment & Products (0.1%) | ||||||||
Cts Eventim | 14,619 | $ | 713,483 | |||||
Metals & Mining (0.3%) | ||||||||
Norddeutsche Affinerie AG | 54,368 | 2,405,002 | ||||||
Semiconductors & Semiconductor Equipment (0.2%) | ||||||||
Aixtron* | 191,829 | 1,668,624 | ||||||
Kontron AG | 23,970 | 447,840 | ||||||
2,116,464 | ||||||||
Telephones (0.1%) | ||||||||
Freenet AG* | 19,742 | 649,758 | ||||||
12,361,788 | ||||||||
GREECE (0.4%) | ||||||||
Hotels, Restaurants & Leisure (0.2%) | ||||||||
Intralot SA | 50,156 | 1,605,010 | ||||||
Marine (0.2%) | ||||||||
Omega Navigation Enterprises, Inc. | 105,180 | 2,287,665 | ||||||
3,892,675 | ||||||||
HONG KONG (1.1%) | ||||||||
Automobiles (0.0%) | ||||||||
Great Wall Motor Co. Ltd. | 240,000 | 349,305 | ||||||
Communications Equipment (0.3%) | ||||||||
VTech Holdings Ltd. | 276,000 | 2,328,521 | ||||||
Diversified Financial Services (0.1%) | ||||||||
First Pacific Co. Ltd. | 938,000 | 677,197 | ||||||
Hotels, Restaurants & Leisure (0.1%) | ||||||||
Hong Kong & Shanghai Hotels | 117,000 | 206,814 | ||||||
Regal Hotels International Holdings Ltd. | 4,988,000 | 421,241 | ||||||
628,055 | ||||||||
Industrial Conglomerate (0.1%) | ||||||||
Tianjin Development Holdings Ltd. | 1,162,000 | 1,265,061 | ||||||
Internet & Catalog Retail (0.3%) | ||||||||
SINA Corp.* | 60,900 | 2,549,274 | ||||||
Real Estate Management & Development (0.0%) | ||||||||
HKR International | 544,000 | 401,063 | ||||||
Textiles, Apparel & Luxury Goods (0.1%) | ||||||||
Peace Mark Holdings Ltd. | 402,000 | 549,282 | ||||||
Transportation (0.1%) | ||||||||
Integrated Distribution Services Group Ltd. | 196,000 | 618,221 | ||||||
Pacific Basin Shipping Ltd. | 168,000 | 188,894 | ||||||
807,115 | ||||||||
Transportation Infrastructure (0.0%) | ||||||||
Sichuan Expressway Co. Ltd. | 1,136,000 | 341,504 | ||||||
Wireless Telecommunication Services (0.0%) | ||||||||
SmarTone Telecommunications Holdings Ltd. | 107,500 | 124,281 | ||||||
10,020,658 | ||||||||
IRELAND (0.6%) | ||||||||
Commercial Services & Supplies (0.1%) | ||||||||
Cpl Resources PLC | 51,738 | 502,232 | ||||||
Food Products (0.1%) | ||||||||
Fyffes PLC | 529,772 | 630,911 | ||||||
Gaming (0.0%) | ||||||||
Paddy Power PLC | 5,918 | 184,472 | ||||||
Household Durables (0.1%) | ||||||||
Mcinerney Holdings PLC | 176,622 | 575,707 | ||||||
Life Sciences Tools & Services (0.1%) | ||||||||
Icon PLC (Sponsored) ADR - IE* | 29,400 | 1,285,956 | ||||||
Transportation (0.2%) | ||||||||
Genesis Lease Ltd. ADR - IE | 72,100 | 1,975,540 | ||||||
5,154,818 | ||||||||
ITALY (0.7%) | ||||||||
Construction Materials (0.1%) | ||||||||
Cementir | 35,349 | 501,371 | ||||||
Electronic Equipment & Instruments (0.1%) | ||||||||
SAES Getters | 9,007 | 336,884 | ||||||
SAES Getters SPA | 11,606 | 357,992 | ||||||
694,876 | ||||||||
Food & Staples Retailing (0.0%) | ||||||||
Marr SPA | 26,930 | 304,736 | ||||||
Food Products (0.1%) | ||||||||
Cremonini SPA | 248,509 | 825,400 | ||||||
Machinery (0.1%) | ||||||||
Biesse SPA | 45,955 | 1,512,536 | ||||||
Common Stock (continued) | ||||||||
Shares or | ||||||||
Principal Amount | Value | |||||||
ITALY (continued) | ||||||||
Metals & Mining (0.1%) | ||||||||
Smi - Societa Metallurgica Italiana SPA* | 541,456 | $ | 497,372 | |||||
Pharmaceutical (0.0%) | ||||||||
Recordati SPA | 20,362 | 169,736 | ||||||
Textiles, Apparel & Luxury Goods (0.2%) | ||||||||
Benetton Group SPA | 111,006 | 1,929,300 | ||||||
6,435,327 | ||||||||
JAPAN (6.1%) | ||||||||
Air Freight & Logistics (0.1%) | ||||||||
Kintetsu World Express, Inc. | 25,600 | 869,315 | ||||||
Auto Components (0.3%) | ||||||||
Nissin Kogyo Co. Ltd. | 84,700 | 2,356,564 | ||||||
Toyo Tire & Rubber Co. Ltd. | 133,000 | 691,877 | ||||||
3,048,441 | ||||||||
Beverages (0.1%) | ||||||||
Asahi Soft Drinks Co. Ltd. | 11,500 | 170,068 | ||||||
Oenon Holdings, Inc. | 208,000 | 555,954 | ||||||
726,022 | ||||||||
Building Products (0.0%) | ||||||||
Bunka Shutter Co. Ltd. | 11,000 | 62,963 | ||||||
Capital Markets (0.1%) | ||||||||
Japan Asia Investment Co. Ltd. | 69,000 | 431,309 | ||||||
Chemicals (0.1%) | ||||||||
Kanto Denka Kogyo Co. Ltd. | 90,000 | 480,711 | ||||||
Tohcello Co. Ltd. | 38,000 | 424,518 | ||||||
905,229 | ||||||||
Commercial Bank (0.0%) | ||||||||
Nishi-Nippon City Bank Ltd. (The) | 51,000 | 186,646 | ||||||
Commercial Services & Supplies (0.1%) | ||||||||
Pason, Inc. | 537 | 910,723 | ||||||
Construction & Engineering (0.0%) | ||||||||
Maeda Road Construction Co. Ltd. | 44,000 | 390,046 | ||||||
Consumer Goods (0.3%) | ||||||||
Circle K Sunkus Co. Ltd. | 38,600 | 673,728 | ||||||
Mandom Corp. | 14,400 | 330,457 | ||||||
Megane Top Co. Ltd. | 28,800 | 324,554 | ||||||
Sanei International Co. Ltd. | 35,800 | 1,135,840 | ||||||
2,464,579 | ||||||||
Distributor (0.1%) | ||||||||
Fields Corp. NPV | 402 | 498,381 | ||||||
Diversified Financial Services (0.0%) | ||||||||
Ricoh Leasing | 13,000 | 294,408 | ||||||
Electric Utility (0.2%) | ||||||||
Okinawa Electric Power | 24,200 | 1,418,615 | ||||||
Electrical Equipment (0.3%) | ||||||||
Chiyoda Integre Co. Ltd. | 13,300 | 340,062 | ||||||
Daiken Corp. | 74,000 | 458,606 | ||||||
Kuroda Electric Co. Ltd. | 108,400 | 1,634,667 | ||||||
Nippon Signal | 91,000 | 591,205 | ||||||
3,024,540 | ||||||||
Electronic Equipment & Instruments (0.1%) | ||||||||
Daiwabo Information System Co. Ltd. | 18,000 | 243,819 | ||||||
KOA Corp. | 54,000 | 724,135 | ||||||
Osaki Electric Co. Ltd. | 35,000 | 273,592 | ||||||
1,241,546 | ||||||||
Energy Equipment & Services (0.2%) | ||||||||
Shinko Plantech Ltd. | 133,000 | 1,856,144 | ||||||
Food & Staples Retailing (0.1%) | ||||||||
Arcs Co. Ltd. | 21,100 | 333,926 | ||||||
Okuwa Co. Ltd. | 47,000 | 637,927 | ||||||
971,853 | ||||||||
Food Products (0.2%) | ||||||||
Nichirei Corp. | 281,000 | 1,445,983 | ||||||
Gas Utility (0.0%) | ||||||||
Shizuokagas Co. Ltd | 47,500 | 262,193 | ||||||
Health Care Equipment & Supplies (0.4%) | ||||||||
Hogy Medical Co. Ltd. | 4,500 | 201,134 | ||||||
Nihon Kohden Corp. | 85,000 | 1,576,843 | ||||||
Nipro Corp. | 70,000 | 1,441,493 | ||||||
3,219,470 | ||||||||
Health Care Providers & Services (0.1%) | ||||||||
BML, Inc. | 9,600 | 166,769 | ||||||
Toho Pharmaceutical Co. Ltd. | 18,600 | 311,665 | ||||||
478,434 | ||||||||
Hotels, Restaurants & Leisure (0.0%) | ||||||||
Kyoritsu Maintenance Co. Ltd. | 15,300 | 309,371 | ||||||
Household Durables (0.0%) | ||||||||
Kenwood Corp. | 104,000 | 155,806 | ||||||
Household Products (0.0%) | ||||||||
Pigeon Corp. | 15,500 | 251,274 | ||||||
Nationwide Multi-Manager NVIT Small Company Fund (Continued)
Common Stock (continued) | ||||||||
Shares or | ||||||||
Principal Amount | Value | |||||||
JAPAN (continued) | ||||||||
Internet Software & Services (0.0%) | ||||||||
Mitsui Knowledge Industry Co. Ltd. | 944 | $ | 251,593 | |||||
IT Services (0.1%) | ||||||||
Hitachi Systems & Services Ltd. | 13,000 | 279,802 | ||||||
TIS, Inc. | 15,200 | 349,136 | ||||||
628,938 | ||||||||
Leisure Equipment & Products (0.4%) | ||||||||
Aruze Corp. | 70,400 | 2,183,029 | ||||||
Yen Tarmon Co. Ltd. | 57,300 | 1,756,620 | ||||||
3,939,649 | ||||||||
Life Sciences Tools & Services (0.1%) | ||||||||
Eiken Chemical Co. Ltd. | 51,600 | 406,671 | ||||||
Machinery (0.4%) | ||||||||
Enshu Ltd. | 132,000 | 330,929 | ||||||
Harmonic Drive System, Inc. | 154 | 770,462 | ||||||
Kitz Corp. | 79,000 | 687,954 | ||||||
Nippon Filcon Co. Ltd. | 23,100 | 176,291 | ||||||
Nippon Thompson Co. Ltd. | 57,000 | 509,495 | ||||||
Tocalo Co. Ltd. | 25,700 | 625,051 | ||||||
3,100,182 | ||||||||
Media (0.2%) | ||||||||
Foster Electric Co. Ltd. | 69,900 | 992,620 | ||||||
Septeni Holdings Company Ltd. | 421 | 500,811 | ||||||
Toei Animation Co. Ltd. | 7,400 | 204,375 | ||||||
Yoshimoto Kogyo Co. Ltd. | 28,100 | 444,460 | ||||||
2,142,266 | ||||||||
Metals & Mining (0.6%) | ||||||||
Godo Steel Ltd. | 117,000 | 550,504 | ||||||
Osaka Steel Co. Ltd. | 54,500 | 1,031,631 | ||||||
Pacific Metals & Mining Co. Ltd. | 97,000 | 1,619,963 | ||||||
Yamato Kogyo | 49,400 | 1,957,802 | ||||||
5,159,900 | ||||||||
Multiline Retail (0.1%) | ||||||||
Hankyu Department Stores, Inc. | 63,000 | 670,801 | ||||||
Parco Co. Ltd. | 31,400 | 397,854 | ||||||
1,068,655 | ||||||||
Personal Products (0.1%) | ||||||||
Aderans Co. Ltd. | 27,900 | 587,548 | ||||||
Pharmaceuticals (0.2%) | ||||||||
Kaken Pharmaceutical | 44,000 | 320,318 | ||||||
NICHI-IKO Pharmaceutical Co. | 16,100 | 281,044 | ||||||
Santen Pharmaceutical Co. Ltd. | 21,600 | 526,052 | ||||||
Towa Pharmaceutical Co. Ltd. | 26,100 | 1,069,007 | ||||||
2,196,421 | ||||||||
Real Estate Management & Development (0.3%) | ||||||||
Apamanshop Holdings Co. Ltd | 1,195 | 369,574 | ||||||
Daiwasystem Co. Ltd | 19,600 | 548,832 | ||||||
Funai Zaisan Consultants | 54 | 315,524 | ||||||
Hoosiers Corp | 550 | 363,685 | ||||||
Land Co. Ltd. | 143 | 214,281 | ||||||
Pacific Management Corp. | 90 | 166,160 | ||||||
Sun Frontier Fudousan Co. Ltd. | 169 | 342,374 | ||||||
Suncity Co. Ltd. | 846 | 543,014 | ||||||
2,863,444 | ||||||||
Semiconductors & Semiconductor Equipment (0.4%) | ||||||||
Japan Electronic Materials Corp. | 35,100 | 480,615 | ||||||
Mitsui High-Tec, Inc. | 54,900 | 740,145 | ||||||
New Japan Radio Co. Ltd. | 71,000 | 391,206 | ||||||
Shibaura Mechatronics Corp. | 211,000 | 1,276,552 | ||||||
Shinkawa Ltd. | 40,700 | 854,063 | ||||||
3,742,581 | ||||||||
Software (0.3%) | ||||||||
Capcom Co. Ltd. | 108,200 | 2,018,087 | ||||||
Hudson Soft Co. Ltd.* | 25,700 | 307,606 | ||||||
Nippon System Development Co. Ltd. | 40,000 | 587,397 | ||||||
2,913,090 | ||||||||
Textiles, Apparel & Luxury Goods (0.1%) | ||||||||
Sanyo Shokai Ltd. | 50,000 | 430,193 | ||||||
54,854,422 | ||||||||
MEXICO (0.5%) | ||||||||
Transportation Infrastructure (0.5%) | ||||||||
Grupo Aeroportuario Del Pacifico SA de CV ADR | 88,703 | 4,374,832 | ||||||
NETHERLANDS (1.7%) | ||||||||
Construction & Engineering (0.8%) | ||||||||
Arcadis NV | 12,382 | 1,049,232 | ||||||
Chicago Bridge & Iron Co. | 166,353 | 6,278,162 | ||||||
7,327,394 | ||||||||
Energy Equipment & Services (0.1%) | ||||||||
Core Laboratories NV* | 7,500 | 762,675 | ||||||
Health Care Providers & Services (0.3%) | ||||||||
Opg Groep NV | 59,803 | 2,178,275 | ||||||
Office Electronics (0.2%) | ||||||||
OCE NV | 88,335 | 1,722,667 | ||||||
Semiconductors & Semiconductor Equipment (0.2%) | ||||||||
Asm International NV* | 64,158 | 1,715,970 | ||||||
Common Stock (continued) | ||||||||
Shares or | ||||||||
Principal Amount | Value | |||||||
NETHERLANDS (continued) | ||||||||
Software (0.0%) | ||||||||
Unit 4 Agresso NV | 9,005 | $ | 243,505 | |||||
Transportation Infrastructure (0.1%) | ||||||||
Smit International NV | 13,540 | 1,057,240 | ||||||
15,007,726 | ||||||||
NEW ZEALAND (0.0%) | ||||||||
Insurance (0.0%) | ||||||||
Tower Ltd.* | 144,895 | 266,234 | ||||||
NORWAY (0.7%) | ||||||||
Capital Markets (0.2%) | ||||||||
Abg Sundal Collier ASA | 237,970 | 620,215 | ||||||
Acta Holding ASA | 297,683 | 1,554,111 | ||||||
2,174,326 | ||||||||
Commercial Banks (0.1%) | ||||||||
Sparebanken Nord-Norge | 17,640 | 419,144 | ||||||
Sparebanken Rogaland | 15,342 | 426,585 | ||||||
845,729 | ||||||||
Construction & Engineering (0.1%) | ||||||||
Veidekke ASA | 64,000 | 677,579 | ||||||
Food Products (0.1%) | ||||||||
Cermaq ASA | 20,300 | 352,563 | ||||||
Leroy Seafood Group ASA | 29,965 | 623,989 | ||||||
976,552 | ||||||||
Marine (0.2%) | ||||||||
Stolt-Nielsen SA | 38,767 | 1,291,813 | ||||||
5,965,999 | ||||||||
PORTUGAL (0.1%) | ||||||||
Construction & Engineering (0.0%) | ||||||||
Cofina, SGPS SA | 118,958 | 290,980 | ||||||
Construction Materials (0.1%) | ||||||||
Sempa (Sociedade de Investimento e Gestao, SGPS SA | 23,915 | 430,905 | ||||||
Food & Staples Retailing (0.0%) | ||||||||
Jeronimo Martins & Filho | 48,155 | 284,531 | ||||||
1,006,416 | ||||||||
PUERTO RICO (0.0%) | ||||||||
Commercial Bank (0.0%) | ||||||||
First BanCorp. Puerto Rico | 11,900 | 130,781 | ||||||
REPUBLIC OF KOREA (0.1%) | ||||||||
Internet Software & Services (0.1%) | ||||||||
Gmarket, Inc. ADR - KR* | 55,684 | 1,081,940 | ||||||
SINGAPORE (0.5%) | ||||||||
Energy Equipment & Services (0.2%) | ||||||||
Ezra Holdings Ltd. | 259,200 | 983,977 | ||||||
Haip Seng Engineering Ltd. | 865,000 | 610,960 | ||||||
1,594,937 | ||||||||
Machinery (0.2%) | ||||||||
MMI Holding Ltd. | 1,376,000 | 1,476,371 | ||||||
Real Estate Management & Development (0.1%) | ||||||||
Ho Bee Investments Ltd. | 223,000 | 342,732 | ||||||
Wing Tai Holdings Ltd. | 330,000 | 859,696 | ||||||
1,202,428 | ||||||||
Trading Companies & Distributors (0.0%) | ||||||||
KS Energy Services Ltd. | 79,000 | 194,239 | ||||||
4,467,975 | ||||||||
SPAIN (0.1%) | ||||||||
Health Care Providers & Services (0.1%) | ||||||||
Corporacion Dermoestetica* | 22,217 | 348,041 | ||||||
Natraceutical SA* | 304,690 | 602,522 | ||||||
950,563 | ||||||||
Metals & Mining (0.0%) | ||||||||
Tubos Reunidos SA | 6,949 | 175,419 | ||||||
1,125,982 | ||||||||
SWEDEN (0.7%) | ||||||||
Capital Markets (0.1%) | ||||||||
D. Carnegie & Co. AB | 43,834 | 764,310 | ||||||
Construction & Engineering (0.2%) | ||||||||
NCC | 66,355 | 1,788,488 | ||||||
Household Durables (0.2%) | ||||||||
JM AB | 52,888 | 1,600,618 | ||||||
Real Estate Management & Development (0.2%) | ||||||||
Kungsleden AB | 124,327 | 1,547,731 | ||||||
Specialty Retail (0.0%) | ||||||||
Nobia AB | 23,948 | 298,349 | ||||||
5,999,496 | ||||||||
SWITZERLAND (0.7%) | ||||||||
Capital Markets (0.1%) | ||||||||
Vontobel Holding AG | 9,243 | 529,471 | ||||||
Nationwide Multi-Manager NVIT Small Company Fund (Continued)
Common Stock (continued) | ||||||||
Shares or | ||||||||
Principal Amount | Value | |||||||
SWITZERLAND (continued) | ||||||||
Commercial Bank (0.0%) | ||||||||
Banque Cantonale Vaudois | 745 | $ | 383,951 | |||||
Electronic Equipment & Instruments (0.1%) | ||||||||
Inficon Holding AG | 2,612 | 457,807 | ||||||
Household Durables (0.1%) | ||||||||
AFG Arbonia-Forster Holding AG | 983 | 512,131 | ||||||
Insurance (0.1%) | ||||||||
Helvetia Patria Holding | 1,891 | 723,672 | ||||||
Machinery (0.2%) | ||||||||
Georg Fischer AG* | 2,384 | 1,799,570 | ||||||
Specialty Retail (0.1%) | ||||||||
Charles Voegele Holding AG* | 14,013 | 1,549,325 | ||||||
5,955,927 | ||||||||
UNITED KINGDOM (3.1%) | ||||||||
Air Freight & Logistics (0.1%) | ||||||||
Wincanton PLC | 83,122 | 688,506 | ||||||
Commercial Services & Supplies (0.9%) | ||||||||
Babcock International Group PLC | 150,600 | 1,625,856 | ||||||
DE LA Rue PLC | 115,301 | 1,793,548 | ||||||
Infinity Bio-Energy Ltd.* | 94,500 | 484,785 | ||||||
ITE Group PLC | 142,139 | 480,928 | ||||||
Mouchel Parkman PLC | 45,058 | 347,347 | ||||||
Robert Walters PLC | 62,029 | 479,673 | ||||||
RPS Group PLC | 122,711 | 860,952 | ||||||
Shanks Group PLC | 178,754 | 888,957 | ||||||
St. Ives PLC | 196,362 | 955,137 | ||||||
7,917,183 | ||||||||
Construction & Engineering (0.2%) | ||||||||
Keller Group PLC | 24,145 | 521,084 | ||||||
Kier Group PLC | 40,273 | 1,652,975 | ||||||
2,174,059 | ||||||||
Consumer Goods (0.0%) | ||||||||
N Brown Group PLC | 74,103 | 450,948 | ||||||
Diversified Consumer Services (0.0%) | ||||||||
Bpp Holdings PLC | 21,835 | 250,781 | ||||||
Diversified Financial Services (0.1%) | ||||||||
IG Group Holdings PLC | 121,752 | 718,723 | ||||||
Energy Equipment & Services (0.2%) | ||||||||
Petrofac Ltd. | 181,037 | 1,619,519 | ||||||
Food Products (0.2%) | ||||||||
Dairy Crest Group PLC | 159,743 | 2,173,132 | ||||||
Hotels, Restaurants & Leisure (0.1%) | ||||||||
Restaurant Group PLC | 82,023 | 541,023 | ||||||
Household Products (0.1%) | ||||||||
Mcbride PLC | 233,482 | 1,029,307 | ||||||
Insurance (0.4%) | ||||||||
Beazley Group PLC | 251,391 | 738,146 | ||||||
Brit Insurance Holdings PLC | 252,658 | 1,735,581 | ||||||
Chaucer Holdings PLC | 517,846 | 998,197 | ||||||
3,471,924 | ||||||||
IT Services (0.0%) | ||||||||
Computacenter PLC | 76,896 | 346,538 | ||||||
Leisure Equipment & Products (0.1%) | ||||||||
Sportingbet PLC* | 638,447 | 737,720 | ||||||
Media (0.0%) | ||||||||
Euromoney Institutional Investor | 24,820 | 324,928 | ||||||
Oil, Gas & Consumable Fuels (0.2%) | ||||||||
BPS Hunting Ord | 131,238 | 1,920,985 | ||||||
Real Estate Management & Development (0.2%) | ||||||||
Big Yellow Group PLC | 110,865 | 1,164,231 | ||||||
BPS Dtz Holdings PLC | 26,350 | 274,218 | ||||||
1,438,449 | ||||||||
Telephones (0.1%) | ||||||||
Kingston Communications (Hull) PLC | 447,763 | 663,850 | ||||||
Thus Group PLC* | 69,145 | 254,419 | ||||||
918,269 | ||||||||
Thrifts & Mortgage Finance (0.2%) | ||||||||
Paragon Group | 163,551 | 1,602,412 | ||||||
28,324,406 | ||||||||
UNITED STATES (72.9%) | ||||||||
Aerospace & Defense (1.4%) | ||||||||
AAR Corp.* | 16,800 | 554,568 | ||||||
Argon St., Inc.* | 32,800 | 761,288 | ||||||
Ceradyne, Inc.* | 29,554 | 2,185,814 | ||||||
Cubic Corp. | 5,633 | 170,004 | ||||||
Curtiss-Wright Corp. | 46,992 | 2,190,297 | ||||||
DRS Technologies, Inc. | 25,041 | 1,434,098 | ||||||
Ducommun, Inc.* | 1,264 | 32,523 | ||||||
Hexcel Corp.* | 29,400 | 619,458 | ||||||
Moog, Inc., Class A* | 36,050 | 1,590,165 | ||||||
MTC Technologies, Inc.* | 36,900 | 906,264 | ||||||
Orbital Sciences Corp.* | 19,100 | 401,291 |
Common Stock (continued) | ||||||||
Shares or | ||||||||
Principal Amount | Value | |||||||
UNITED STATES (continued) | ||||||||
Aerospace & Defense (continued) | ||||||||
Spirit Aerosystems Holdings, Inc., Class A* | 44,000 | $ | 1,586,200 | |||||
Teledyne Technologies, Inc.* | 2,949 | 135,507 | ||||||
Triumph Group, Inc. | 5,700 | 373,179 | ||||||
United Industrial Corp. | 1,482 | 88,890 | ||||||
13,029,546 | ||||||||
Air Freight & Logistics (0.3%) | ||||||||
EGL, Inc.* | 7,771 | 361,196 | ||||||
Forward Air Corp. | 27,625 | 941,736 | ||||||
HUB Group, Inc., Class A* | 22,606 | 794,827 | ||||||
Pacer International, Inc. | 14,600 | 343,392 | ||||||
2,441,151 | ||||||||
Airlines (0.1%) | ||||||||
Frontier Airlines Holdings, Inc.* | 10,624 | 59,494 | ||||||
Mesa Air Group, Inc.* | 7,689 | 50,824 | ||||||
Republic Airways Holdings, Inc.* | 18,900 | 384,615 | ||||||
SkyWest, Inc. | 17,190 | 409,638 | ||||||
904,571 | ||||||||
Auto Components (0.5%) | ||||||||
Aftermarket Technology Corp.* | 5,448 | 161,697 | ||||||
ArvinMeritor, Inc. | 17,100 | 379,620 | ||||||
Drew Industries, Inc.* | 28,400 | 941,176 | ||||||
GenTek, Inc.* | 1,856 | 65,368 | ||||||
LKQ Corp.* | 116,056 | 2,861,941 | ||||||
Modine Manufacturing Co. | 13,000 | 293,800 | ||||||
Standard Motor Products, Inc. | 1,639 | 24,634 | ||||||
4,728,236 | ||||||||
Automobiles (0.1%) | ||||||||
Travelcenters Of America* | 17,624 | 712,891 | ||||||
Banks (0.1%) | ||||||||
Charter Financial, Inc. | 1,291 | 65,841 | ||||||
Flushing Financial Corp. | 41,000 | 658,460 | ||||||
FNB Corp. | 1,807 | 30,249 | ||||||
Susquehanna Bancshares, Inc. | 20,000 | 447,400 | ||||||
1,201,950 | ||||||||
Beverages (0.0%) | ||||||||
Boston Beer Co., Inc., Class A* | 4,400 | 173,140 | ||||||
Coca-Cola Bottling Co. | 1,103 | 55,481 | ||||||
MGP Ingredients, Inc. | 10,800 | 182,520 | ||||||
411,141 | ||||||||
Biotechnology (0.0%) | ||||||||
Celera Genomics Group* | 11,600 | 143,840 | ||||||
InterMune, Inc.* | 8,600 | 223,084 | ||||||
366,924 | ||||||||
Building Products (0.3%) | ||||||||
Aaon, Inc. | 5,100 | 162,435 | ||||||
American Woodmark Corp. | 23,945 | 828,497 | ||||||
Simpson Manufacturing Co., Inc. | 58,500 | 1,973,790 | ||||||
2,964,722 | ||||||||
Capital Markets (1.0%) | ||||||||
Calamos Asset Management, Inc. | 2,062 | 52,684 | ||||||
FCStone Group, Inc.* | 18,400 | 1,054,504 | ||||||
Greenhill & Co., Inc. | 61,964 | 4,257,546 | ||||||
Knight Capital Group, Inc., Class A* | 28,300 | 469,780 | ||||||
Sanders Morris Harris Group, Inc. | 94,300 | 1,097,652 | ||||||
SWS Group, Inc. | 63,750 | 1,378,275 | ||||||
TradeStation Group, Inc.* | 67,830 | 790,220 | ||||||
9,100,661 | ||||||||
Chemicals (0.8%) | ||||||||
BE Aerospace, Inc.* | 9,000 | 371,700 | ||||||
C.F. Industries Holdings, Inc. | 7,300 | 437,197 | ||||||
Celanese Corp. | 59,310 | 2,300,042 | ||||||
Cytec Industries, Inc. | 7,500 | 478,275 | ||||||
Fuller (H. B.) Co. | 16,639 | 497,340 | ||||||
Hercules, Inc.* | 20,000 | 393,000 | ||||||
Ico, Inc.* | 2,043 | 21,594 | ||||||
Newmarket Corp. | 1,200 | 58,044 | ||||||
Olin Corp. | 30,300 | 636,300 | ||||||
Pioneer Cos., Inc.* | 17,697 | 608,246 | ||||||
PolyOne Corp.* | 17,400 | 125,106 | ||||||
Terra Industries, Inc.* | 33,211 | 844,224 | ||||||
6,771,068 | ||||||||
Commercial Banks (2.2%) | ||||||||
Amcore Financial, Inc. | 11,100 | 321,789 | ||||||
BancFirst Corp. | 5,398 | 231,142 | ||||||
Bank of Hawaii Corp. | 30,099 | 1,554,312 | ||||||
Banner Corp. | 2,290 | 77,997 | ||||||
BOK Financial Corp. | 12,100 | 646,382 | ||||||
Boston Private Financial Holdings, Inc. | 12,600 | 338,562 | ||||||
Center Financial Corp. | 471 | 7,969 | ||||||
Central Pacific Financial Corp. | 16,300 | 538,063 | ||||||
Citizens Banking Corp. | 3,600 | 65,880 | ||||||
City Holding Co. | 7,096 | 271,990 | ||||||
City National Corp. | 14,633 | 1,113,425 | ||||||
Colonial Bancgroup, Inc. | 28,200 | 704,154 |
Nationwide Multi-Manager NVIT Small Company Fund (Continued)
Common Stock (continued) | ||||||||
Shares or | ||||||||
Principal Amount | Value | |||||||
UNITED STATES (continued) | ||||||||
Commercial Banks (continued) | ||||||||
Commerce Bancshares, Inc. | 9,646 | $ | 436,964 | |||||
Community Trust Bancorp, Inc. | 715 | 23,095 | ||||||
East West Bancorp, Inc. | 46,003 | 1,788,597 | ||||||
Financial Institutions, Inc. | 5,365 | 108,319 | ||||||
First Citizens BancShares, Class A | 4,551 | 884,714 | ||||||
First Commonwealth Financial Corp. | 23,200 | 253,344 | ||||||
First Midwest Bancorp, Inc. | 4,900 | 173,999 | ||||||
First Regional Bancorp* | 5,404 | 137,478 | ||||||
First State Bancorp | 2,800 | 59,612 | ||||||
Glacier Bancorp, Inc. | 41,500 | 844,525 | ||||||
Great Southern Bancorp, Inc. | 10,400 | 281,320 | ||||||
Hanmi Financial Corp. | 46,700 | 796,702 | ||||||
Independent Bank Corp. | 3,900 | 115,206 | ||||||
Intervest Bancshares Corp. | 4,408 | 124,129 | ||||||
Mainsource Financial Group, Inc. | 3,885 | 65,229 | ||||||
National Penn Bancshares, Inc. | 46,355 | 773,201 | ||||||
NBT Bancorp, Inc. | 15,830 | 357,125 | ||||||
Old National Bancorp | 24,200 | 401,962 | ||||||
Pacific Capital Bancorp | 24,259 | 654,508 | ||||||
Preferred Bank | 2,584 | 103,360 | ||||||
Prosperity Bancshares, Inc. | 8,198 | 268,566 | ||||||
Provident Bankshares Corp. | 19,900 | 652,322 | ||||||
Republic Bancorp, Inc., Class A | 1,575 | 26,129 | ||||||
Signature Bank* | 21,200 | 722,920 | ||||||
Sterling Financial Corp. | 20,245 | 212,977 | ||||||
Suffolk Bancorp | 1,800 | 57,456 | ||||||
SVB Financial Group* | 5,931 | 314,995 | ||||||
Taylor Capital Group, Inc. | 1,694 | 46,636 | ||||||
Trustmark Corp. | 4,675 | 120,896 | ||||||
UCBH Holdings, Inc. | 21,300 | 389,151 | ||||||
UMB Financial Corp. | 7,300 | 269,151 | ||||||
Union Bankinghares Corp. | 21,268 | 493,418 | ||||||
Vineyard National Bancorp Co. | 2,814 | 64,638 | ||||||
WesBanco, Inc. | 1,074 | 31,683 | ||||||
West America Bankcorp | 38,100 | 1,685,544 | ||||||
West Coast Bancorp | 1,061 | 32,244 | ||||||
Western Alliance Bancorp* | 2,200 | 65,670 | ||||||
Whitney Holding Corp. | 5,646 | 169,945 | ||||||
19,879,395 | ||||||||
Commercial Services & Supplies (4.4%) | ||||||||
Advisory Board Co. (The)* | 73,797 | 4,100,161 | ||||||
Ambassadors International | 47,560 | 1,581,846 | ||||||
Amper Corp. | 11,350 | 539,692 | ||||||
Bowne & Co., Inc. | 4,100 | 79,991 | ||||||
Brady Corp., Class A | 65,300 | 2,425,242 | ||||||
CBIZ, Inc.* | 28,300 | 208,005 | ||||||
Cenveo, Inc.* | 9,000 | 208,710 | ||||||
Comsys IT Partners, Inc.* | 32,530 | 742,009 | ||||||
Consolidated Graphics, Inc.* | 4,250 | 294,440 | ||||||
Corporate Executive Board Co. | 33,602 | 2,181,106 | ||||||
CoStar Group, Inc.* | 86,795 | 4,589,720 | ||||||
Deluxe Corp. | 37,947 | 1,541,028 | ||||||
Dun & Bradstreet Corp. | 944 | 97,213 | ||||||
Endeavor Acquisition Corp.* | 118,176 | 1,394,477 | ||||||
Exponet, Inc.* | 29,200 | 653,204 | ||||||
First Consulting Group, Inc.* | 3,479 | 33,050 | ||||||
FTI Consulting, Inc.* | 11,300 | 429,739 | ||||||
Healthcare Services Group, Inc. | 26,800 | 790,600 | ||||||
IHS, Inc., Class A* | 96,630 | 4,444,980 | ||||||
IKON Office Solutions, Inc. | 5,100 | 79,611 | ||||||
Kelly Services, Inc. | 14,200 | 389,932 | ||||||
Knoll, Inc. | 45,022 | 1,008,493 | ||||||
LECG Corp.* | 27,500 | 415,525 | ||||||
Manhattan Associates, Inc.* | 30,800 | 859,628 | ||||||
Mine Safety Appliances Co. | 15,300 | 669,528 | ||||||
Mobile Mini, Inc.* | 60,600 | 1,769,520 | ||||||
Rollins, Inc. | 38,800 | 883,476 | ||||||
Spherion Corp.* | 42,900 | 402,831 | ||||||
Standard Parking Corp.* | 4,551 | 159,877 | ||||||
Stericycle, Inc.* | 3,618 | 160,856 | ||||||
TeleTech Holdings, Inc.* | 13,900 | 451,472 | ||||||
United Stationers, Inc.* | 26,800 | 1,785,952 | ||||||
Viad Corp. | 56,006 | 2,361,773 | ||||||
Waste Connections, Inc.* | 17,000 | 514,080 | ||||||
Watson Wyatt Worldwide, Inc. | 27,526 | 1,389,512 | ||||||
39,637,279 | ||||||||
Communications Equipment (1.2%) | ||||||||
Anaren, Inc.* | 15,100 | 265,911 | ||||||
C-COR, Inc.* | 31,103 | 437,308 | ||||||
CommScope, Inc.* | 42,425 | 2,475,499 | ||||||
Comtech Group, Inc.* | 88,600 | 1,462,786 | ||||||
Comtech Telecommunications Corp.* | 10,001 | 464,247 | ||||||
EMS Technologies* | 5,200 | 114,712 | ||||||
InterDigital Communications Corp.* | 64,566 | 2,077,088 | ||||||
Netgear, Inc.* | 17,908 | 649,165 | ||||||
Oplink Communications, Inc.* | 21,000 | 315,000 | ||||||
Powerwave Technologies, Inc.* | 226,380 | 1,516,746 | ||||||
Riverbed Technology, Inc.* | 20,900 | 915,838 | ||||||
Sonus Networks, Inc.* | 37,900 | 322,908 | ||||||
U.T. Starcom, Inc.* | 19,300 | 108,273 | ||||||
11,125,481 | ||||||||
Common Stock (continued) | ||||||||
Shares or | ||||||||
Principal Amount | Value | |||||||
UNITED STATES (continued) | ||||||||
Computers & Peripherals (0.1%) | ||||||||
Brocade Communications Systems, Inc.* | 38,850 | $ | 303,807 | |||||
Immersion Corp.* | 11,695 | 175,191 | ||||||
Integral Systems, Inc. | 2,500 | 60,775 | ||||||
Western Digital Corp.* | 17,560 | 339,786 | ||||||
Xyratex, Ltd.* | 6,297 | 139,982 | ||||||
1,019,541 | ||||||||
Construction & Engineering (0.6%) | ||||||||
Emcor Group, Inc.* | 35,267 | 2,570,964 | ||||||
NVR, Inc.* | 1,365 | 927,859 | ||||||
Perini Corp.* | 28,551 | 1,756,743 | ||||||
5,255,566 | ||||||||
Construction Materials (0.4%) | ||||||||
Headwaters, Inc.* | 19,000 | 328,130 | ||||||
Texas Industries, Inc. | 36,584 | 2,868,551 | ||||||
U.S. Concrete, Inc.* | 64,532 | 560,783 | ||||||
3,757,464 | ||||||||
Consumer Finance (0.1%) | ||||||||
Advanta Corp., Class B | 6,621 | 206,178 | ||||||
Rewards Network, Inc.* | 20,090 | 81,766 | ||||||
World Acceptance Corp.* | 3,794 | 162,118 | ||||||
450,062 | ||||||||
Consumer Goods (0.5%) | ||||||||
Central Garden & Pet Co.* | 32,800 | 384,744 | ||||||
Dolby Laboratories, Inc.* | 17,431 | 617,232 | ||||||
Jamba, Inc.* | 209,873 | 1,918,239 | ||||||
Jo-Ann Stores, Inc.* | 47,914 | 1,362,195 | ||||||
Pc Mall, Inc.* | 17,722 | 216,740 | ||||||
Tempur-Pedic International, Inc. | 1,165 | 30,173 | ||||||
4,529,323 | ||||||||
Containers & Packaging (0.7%) | ||||||||
AEP Industries* | 6,782 | 305,258 | ||||||
AptarGroup, Inc. | 111,600 | 3,968,496 | ||||||
Rock-Tenn Co. | 56,111 | 1,779,841 | ||||||
Silgan Holdings, Inc. | 9,930 | 548,930 | ||||||
6,602,525 | ||||||||
Distributors (0.1%) | ||||||||
Core-Mark Holding Co., Inc.* | 2,887 | 103,874 | ||||||
MWI Veterinary Supply, Inc.* | 24,000 | 957,360 | ||||||
Scansource, Inc.* | 1,800 | 57,582 | ||||||
1,118,816 | ||||||||
Diversified Consumer Services (2.3%) | ||||||||
Coinstar, Inc.* | 16,059 | 505,537 | ||||||
CPI Corp. | 13,349 | 927,755 | ||||||
ITT Educational Services, Inc.* | 41,200 | 4,836,056 | ||||||
Matthews International Corp., Class A | 63,000 | 2,747,430 | ||||||
Premier Exhibitions, Inc.* | 82,727 | 1,303,778 | ||||||
Prepaid Depot, Inc.* | 8,826 | 567,600 | ||||||
Regis Corp. | 11,434 | 437,351 | ||||||
Sotheby’s Holdings, Inc. | 71,746 | 3,301,751 | ||||||
Strayer Education, Inc. | 41,529 | 5,469,785 | ||||||
Vertrue, Inc.* | 10,030 | 489,263 | ||||||
20,586,306 | ||||||||
Diversified Financial Services (0.2%) | ||||||||
Financial Federal Corp. | 74,750 | 2,229,045 | ||||||
Diversified Telecommunication Services (0.9%) | ||||||||
Alaska Communications Systems Holdings, Inc. | 6,400 | 101,376 | ||||||
CenturyTel, Inc. | 6,518 | 319,708 | ||||||
Cincinnati Bell, Inc.* | 45,575 | 263,424 | ||||||
Cognet Communications Group, Inc.* | 127,090 | 3,796,178 | ||||||
CT Communications, Inc. | 40,081 | 1,222,871 | ||||||
Fairpoint Communications, Inc. | 40,500 | 718,875 | ||||||
IDT Corp. | 66,255 | 683,752 | ||||||
PAETEC Holding Corp.* | 11,500 | 129,835 | ||||||
Premiere Global Services, Inc.* | 33,602 | 437,498 | ||||||
7,673,517 | ||||||||
Electric Utilities (0.7%) | ||||||||
Allete, Inc. | 19,080 | 897,714 | ||||||
El Paso Electric Co.* | 87,069 | 2,138,415 | ||||||
IDACORP, Inc. | 15,400 | 493,416 | ||||||
Portland General Electric Co. | 15,500 | 425,320 | ||||||
UIL Holdings Corp. | 3,700 | 122,470 | ||||||
UniSource Energy Corp. | 30,300 | 996,567 | ||||||
Westar Energy, Inc. | 35,300 | 857,084 | ||||||
5,930,986 | ||||||||
Electrical Equipment (0.3%) | ||||||||
General Cable Corp.* | 1,360 | 103,020 | ||||||
Genlyte Group, Inc.* | 5,600 | 439,824 | ||||||
Graftech International Ltd.* | 110,753 | 1,865,081 | ||||||
2,407,925 | ||||||||
Electronic Equipment & Instruments (1.3%) | ||||||||
Anixter International, Inc.* | 1,700 | 127,857 | ||||||
Bell Microproducts, Inc.* | 75,175 | 490,141 | ||||||
Checkpoint Systems, Inc.* | 7,456 | 188,264 | ||||||
Cognex Corp. | 14,400 | 324,144 | ||||||
Coherent, Inc.* | 7,200 | 219,672 |
Nationwide Multi-Manager NVIT Small Company Fund (Continued)
Common Stock (continued) | ||||||||
Shares or | ||||||||
Principal Amount | Value | |||||||
UNITED STATES (continued) | ||||||||
Electronic Equipment & Instruments (continued) | ||||||||
CTS Corp. | 29,100 | $ | 368,406 | |||||
DTS, Inc.* | 47,700 | 1,038,429 | ||||||
FLIR Systems, Inc.* | 4,600 | 212,750 | ||||||
Insight Enterprises, Inc.* | 14,100 | 318,237 | ||||||
Littlefuse, Inc.* | 20,944 | 707,279 | ||||||
LoJack Corp.* | 3,925 | 87,488 | ||||||
Merix Corp.* | 6,558 | 51,743 | ||||||
Methode Electronics | 57,215 | 895,415 | ||||||
Mettler Toledo International, Inc.* | 22,285 | 2,128,440 | ||||||
Newport Corp.* | 9,200 | 142,416 | ||||||
Plexus Corp.* | 27,000 | 620,730 | ||||||
Rofin-Sinar Technologies, Inc.* | 21,000 | 1,449,000 | ||||||
Stoneridge, Inc.* | 2,863 | 35,329 | ||||||
Technitrol, Inc. | 67,800 | 1,943,826 | ||||||
11,349,566 | ||||||||
Energy Equipment & Services (1.8%) | ||||||||
Bristow Group, Inc.* | 5,681 | 281,494 | ||||||
Carbo Ceramics, Inc. | 39,950 | 1,750,209 | ||||||
Complete Production Services* | 22,400 | 579,040 | ||||||
Drill-Quip, Inc.* | 11,500 | 516,925 | ||||||
Grey Wolf, Inc.* | 285,453 | 2,352,133 | ||||||
Hanover Compressor Co.* | 10,000 | 238,500 | ||||||
Input/ Output, Inc.* | 43,100 | 672,791 | ||||||
NATCO Group, Inc., Class A* | 22,200 | 1,022,088 | ||||||
National-OilWell, Inc.* | 7,052 | 735,100 | ||||||
Oceaneering International, Inc.* | 65,100 | 3,426,864 | ||||||
Oil States International, Inc.* | 6,200 | 256,308 | ||||||
Parker Drilling Co.* | 8,800 | 92,752 | ||||||
RPC Energy Services, Inc. | 32,300 | 550,392 | ||||||
Superior Well Services, Inc.* | 16,300 | 414,183 | ||||||
Trico Marine Services, Inc.* | 51,954 | 2,123,880 | ||||||
Unit Corp.* | 12,900 | 811,539 | ||||||
W-H Energy Services, Inc.* | 7,800 | 482,898 | ||||||
16,307,096 | ||||||||
Food & Staples Retailing (0.5%) | ||||||||
Andersons, Inc. (The) | 17,500 | 793,275 | ||||||
Nasch-Finch Co. | 4,433 | 219,433 | ||||||
Performance Food Group Co.* | 26,900 | 873,981 | ||||||
Ruddick Corp. | 6,800 | 204,816 | ||||||
Spartan Stores, Inc. | 24,105 | 793,296 | ||||||
United Natural Foods, Inc.* | 44,000 | 1,169,520 | ||||||
4,054,321 | ||||||||
Food Products (0.7%) | ||||||||
Corn Products International, Inc. | 31,206 | 1,418,313 | ||||||
Imperial Sugar Co. | 49,459 | 1,522,842 | ||||||
J.M. Smucker Co. | 4,068 | 258,969 | ||||||
Peet’s Coffee & Tea, Inc.* | 50,803 | 1,251,278 | ||||||
Seaboard Corp. | 691 | 1,620,395 | ||||||
Tootsie Roll Industries, Inc. | 17,473 | 484,177 | ||||||
6,555,974 | ||||||||
Gas Distribution (0.1%) | ||||||||
Piedmont Natural Gas Co., Inc. | 44,400 | 1,094,460 | ||||||
Semco Energy, Inc.* | 18,839 | 146,379 | ||||||
1,240,839 | ||||||||
Gas Utilities (0.8%) | ||||||||
Energen Corp. | 54,301 | 2,983,297 | ||||||
Laclede Group, Inc. (The) | 23,800 | 758,744 | ||||||
New Jersey Resources Corp. | 30,000 | 1,530,600 | ||||||
NICOR, Inc. | 6,059 | 260,052 | ||||||
Northwest Natural Gas Co. | 12,470 | 575,989 | ||||||
Southwest Gas Corp. | 6,800 | 229,908 | ||||||
UGI Corp. | 39,639 | 1,081,352 | ||||||
7,419,942 | ||||||||
Health Care Equipment & Supplies (3.4%) | ||||||||
American Medical Systems Holdings, Inc.* | 99,300 | 1,791,372 | ||||||
Arrow International, Inc. | 33,913 | 1,298,190 | ||||||
Aspect Medical Systems, Inc.* | 7,100 | 106,216 | ||||||
Conceptus, Inc.* | 5,300 | 102,661 | ||||||
CONMED Corp.* | 23,700 | 693,936 | ||||||
Cutera, Inc.* | 25,200 | 627,984 | ||||||
D.J. Orthopedics, Inc.* | 8,500 | 350,795 | ||||||
Dade Behring Holdings, Inc. | 23,758 | 1,262,025 | ||||||
Edwards Lifesciences Corp.* | 7,274 | 358,899 | ||||||
Greatbatch, Inc.* | 4,200 | 136,080 | ||||||
Haemonetics Corp.* | 28,100 | 1,478,341 | ||||||
Healthtronics, Inc.* | 11,203 | 48,733 | ||||||
ICU Medical, Inc.* | 62,200 | 2,670,868 | ||||||
IDEXX Laboratories, Inc.* | 15,752 | 1,490,612 | ||||||
Immucor, Inc.* | 49,000 | 1,370,530 | ||||||
Integra LifeSciences Holdings* | 17,900 | 884,618 | ||||||
Kinetic Concept* | 32,015 | 1,663,819 | ||||||
Kyphon, Inc.* | 59,300 | 2,855,295 | ||||||
LifeCell Corp.* | 36,900 | 1,126,926 | ||||||
Mentor Corp. | 31,000 | 1,261,080 | ||||||
Nutraceutical International Corp.* | 17,170 | 284,507 | ||||||
Orasure Technologies, Inc.* | 27,800 | 227,404 | ||||||
Palomar Medical Technologies, Inc.* | 11,200 | 388,752 | ||||||
Respironics, Inc.* | 53,648 | 2,284,868 |
Common Stock (continued) | ||||||||
Shares or | ||||||||
Principal Amount | Value | |||||||
UNITED STATES (continued) | ||||||||
Health Care Equipment & Supplies (continued) | ||||||||
Surmodics, Inc.* | 20,800 | $ | 1,040,000 | |||||
Symmetry Medical, Inc.* | 16,900 | 270,569 | ||||||
West Pharmaceutical Services, Inc. | 34,479 | 1,625,685 | ||||||
Wright Medical Group, Inc.* | 38,300 | 923,796 | ||||||
Young Innovations, Inc. | 57,800 | 1,686,604 | ||||||
Zoll Medical Corp.* | 4,200 | 93,702 | ||||||
30,404,867 | ||||||||
Health Care Providers & Services (1.4%) | ||||||||
Alliance Imaging, Inc.* | 6,926 | 65,035 | ||||||
American Dental Partners* | 6,584 | 170,986 | ||||||
Amerigroup Corp.* | 14,300 | 340,340 | ||||||
Amsurg Corp.* | 26,134 | 630,875 | ||||||
Apria Healthcare Group, Inc.* | 68,186 | 1,961,711 | ||||||
Five Star Quality Care, Inc.* | 106,100 | 846,678 | ||||||
Healthspring, Inc.* | 19,497 | 371,613 | ||||||
Healthways, Inc.* | 78,400 | 3,713,808 | ||||||
Henry Schein, Inc.* | 23,700 | 1,266,291 | ||||||
Hythiam, Inc.* | 74,060 | 640,619 | ||||||
Lincare Holdings, Inc.* | 3,742 | 149,119 | ||||||
Magellan Health Services, Inc.* | 13,664 | 634,966 | ||||||
Molina Healthcare, Inc.* | 9,407 | 287,102 | ||||||
PSS World Medical, Inc.* | 26,991 | 491,776 | ||||||
Trimeris, Inc.** | 7,123 | 48,721 | ||||||
Universal Health Services, Inc. | 8,900 | 547,350 | ||||||
Visicu, Inc.* | 87,400 | 799,710 | ||||||
12,966,700 | ||||||||
Health Care Technology (1.5%) | ||||||||
Allscripts Healthcare Solutions, Inc.* | 136,500 | 3,478,020 | ||||||
Cerner Corp.* | 67,100 | 3,722,037 | ||||||
Digene Corp.* | 6,500 | 390,325 | ||||||
GTx, Inc.* | 13,900 | 225,041 | ||||||
Omicell, Inc.* | 76,598 | 1,591,707 | ||||||
Vital Images, Inc.* | 47,300 | 1,284,668 | ||||||
Wellcare Health Plans, Inc.* | 32,012 | 2,897,406 | ||||||
13,589,204 | ||||||||
Hotels, Restaurants & Leisure (4.0%) | ||||||||
AFC Enterprises, Inc.* | 140,826 | 2,434,882 | ||||||
Ambassadors Group, Inc. | 81,770 | 2,905,288 | ||||||
BJ’s Restaurants, Inc.* | 83,451 | 1,647,323 | ||||||
Bob Evans Farms, Inc. | 1,800 | 66,330 | ||||||
Buffalo Wild Wings, Inc.* | 9,338 | 388,367 | ||||||
CBRL Group, Inc. | 6,266 | 266,180 | ||||||
Chipotle Mexican Grill, Inc.* | 5,200 | 443,456 | ||||||
Choice Hotels International, Inc. | 6,246 | 246,842 | ||||||
Dover Downs Gaming & Entertainment, Inc. | 5,700 | 85,557 | ||||||
Gaylord Entertainment Co.* | 161,369 | 8,655,833 | ||||||
Great Wolf Resorts, Inc.* | 85,270 | 1,215,098 | ||||||
IHOP Corp. | 23,100 | 1,257,333 | ||||||
Interstate Hotels & Resorts, Inc.* | 105,541 | 550,924 | ||||||
Jack in the Box, Inc.* | 19,879 | 1,410,216 | ||||||
Krispy Kreme Doughnuts, Inc.* | 109,165 | 1,010,868 | ||||||
P.F. Chang’s China Bistro, Inc.* | 91,622 | 3,225,094 | ||||||
Papa John’s International, Inc.* | 26,844 | 772,033 | ||||||
RARE Hospitality International, Inc.* | 12,800 | 342,656 | ||||||
Ruby Tuesday, Inc. | 17,100 | 450,243 | ||||||
Scientific Games Corp.* | 97,700 | 3,414,615 | ||||||
Speedway Motorsports, Inc. | 1,600 | 63,968 | ||||||
Vail Resorts, Inc.* | 90,242 | 5,493,031 | ||||||
36,346,137 | ||||||||
Household Durables (0.5%) | ||||||||
American Greetings Corp., Class A | 5,380 | 152,416 | ||||||
Avatar Holdings* | 11,238 | 864,652 | ||||||
Blyth Industries, Inc. | 5,623 | 149,459 | ||||||
Brookfield Homes Corp. | 42,569 | 1,238,332 | ||||||
Central Garden & Pet Co.* | 16,400 | 201,064 | ||||||
Directed Electronics, Inc.* | 80,480 | 711,443 | ||||||
Kimball International, Inc., Class B | 21,900 | 306,819 | ||||||
M/ I Homes, Inc. | 1,700 | 45,220 | ||||||
Snap-on, Inc. | 10,447 | 527,678 | ||||||
4,197,083 | ||||||||
Household Products (0.4%) | ||||||||
Church & Dwight, Inc. | 75,500 | 3,658,730 | ||||||
Industrial Conglomerates (0.2%) | ||||||||
Raven Industries, Inc. | 1,617 | 57,743 | ||||||
Teleflex, Inc. | 25,156 | 2,057,258 | ||||||
2,115,001 | ||||||||
Insurance (1.5%) | ||||||||
American Financial Group, Inc. | 32,887 | 1,123,091 | ||||||
American Physicians Capital, Inc.* | 6,900 | 279,450 | ||||||
Argonaut Group, Inc. | 8,457 | 263,943 | ||||||
Brown & Brown, Inc. | 43,500 | 1,093,590 | ||||||
CNA Surety Corp.* | 42,790 | 809,159 | ||||||
Commerce Group, Inc. | 32,600 | 1,131,872 | ||||||
First Mercury Financial Corp.* | 31,900 | 668,943 | ||||||
Greenlight Capital Ltd.* | 45,774 | 1,031,288 | ||||||
HCC Insurance Holdings, Inc. | 42,138 | 1,407,830 | ||||||
Hilb, Rogal & Hamilton Co. | 25,100 | 1,075,786 | ||||||
James River Group, Inc. | 1,622 | 53,899 |
Nationwide Multi-Manager NVIT Small Company Fund (Continued)
Common Stock (continued) | ||||||||
Shares or | ||||||||
Principal Amount | Value | |||||||
UNITED STATES (continued) | ||||||||
Insurance (continued) | ||||||||
Nymagic, Inc. | 774 | $ | 31,115 | |||||
Odyssey Re Holdings Corp. | 42,732 | 1,832,775 | ||||||
Ohio Casualty Corp. | 4,900 | 212,219 | ||||||
Philadelphia Consolidated Holding Corp.* | 9,402 | 393,004 | ||||||
Phoenix Co., Inc. | 30,100 | 451,801 | ||||||
Reinsurance Group Of America | 5,899 | 355,356 | ||||||
Security Capital Assurance Ltd. | 30,400 | 938,448 | ||||||
United Fire & Casualty Corp. | 9,760 | 345,309 | ||||||
13,498,878 | ||||||||
Internet & Catalog Retail (1.3%) | ||||||||
Blue Nile, Inc.* | 86,026 | 5,195,971 | ||||||
FTD Group, Inc. | 2,900 | 53,389 | ||||||
Knot, Inc. (The)* | 60,400 | 1,219,476 | ||||||
Netflix, Inc.* | 49,160 | 953,212 | ||||||
Priceline.com, Inc.* | 40,123 | 2,758,055 | ||||||
Stamps.com, Inc.* | 85,400 | 1,176,812 | ||||||
Systemax, Inc. | 17,900 | 372,499 | ||||||
ValueVision International, Inc., Class A* | 9,200 | 104,144 | ||||||
11,833,558 | ||||||||
Internet Software & Services (2.0%) | ||||||||
Ariba, Inc.* | 45,200 | 447,932 | ||||||
Bankrate, Inc.* | 63,943 | 3,064,148 | ||||||
CNET Networks, Inc.* | 145,219 | 1,189,344 | ||||||
Comscore, Inc.* | 34,166 | 790,943 | ||||||
Dealertrack Holdings, Inc.* | 28,500 | 1,049,940 | ||||||
Equinix, Inc.* | 54,158 | 4,953,832 | ||||||
Greenfield Online* | 8,169 | 129,969 | ||||||
Internap Network Services* | 5,900 | 85,078 | ||||||
Interwoven, Inc.* | 30,800 | 432,432 | ||||||
Loopnet, Inc.* | 89,500 | 2,088,035 | ||||||
RealNetworks, Inc. (b) (c)* | 41,400 | 338,238 | ||||||
Savvis, Inc.* | 2,000 | 99,020 | ||||||
SonicWALL, Inc.* | 60,800 | 522,272 | ||||||
Terremark Worldwide, Inc.* | 9,000 | 58,050 | ||||||
United Online, Inc. | 19,900 | 328,151 | ||||||
Vignette Corp.* | 27,300 | 523,068 | ||||||
Vocus, Inc.* | 34,300 | 861,273 | ||||||
Websense, Inc.* | 57,789 | 1,228,016 | ||||||
18,189,741 | ||||||||
IT Services (1.3%) | ||||||||
Acxiom Corp. | 58,732 | 1,553,461 | ||||||
CACI International, Inc., Class A* | 23,300 | 1,138,205 | ||||||
CheckFree Corp.* | 30,285 | 1,217,457 | ||||||
Convergys Corp.* | 51,705 | 1,253,329 | ||||||
Forrester Research, Inc.* | 55,098 | 1,549,907 | ||||||
ManTech International Corp.* | 36,300 | 1,119,129 | ||||||
MPS Group, Inc.* | 25,700 | 343,609 | ||||||
NCI, Inc.* | 47,600 | 798,252 | ||||||
Ness Technologies, Inc.* | 42,680 | 555,267 | ||||||
RightNow Technologies, Inc.* | 17,707 | 290,572 | ||||||
SI International, Inc.* | 20,500 | 676,910 | ||||||
SRA International, Inc.* | 26,100 | 659,286 | ||||||
Sykes Enterprises, Inc.* | 24,700 | 469,053 | ||||||
Tyler Technologies, Inc.* | 22,600 | 280,466 | ||||||
11,904,903 | ||||||||
Leisure Equipment & Products (0.7%) | ||||||||
JAKKS Pacific, Inc.* | 17,603 | 495,348 | ||||||
Marvel Entertainment, Inc.* | 70,254 | 1,790,072 | ||||||
Nautilus Group, Inc. (The) | 15,400 | 185,416 | ||||||
Pool Corp. | 86,794 | 3,387,570 | ||||||
Steinway Musical Instruments, Inc. | 3,247 | 112,314 | ||||||
Sturm Ruger & Co., Inc.* | 29,062 | 451,042 | ||||||
6,421,762 | ||||||||
Life Sciences Tools & Services (1.2%) | ||||||||
Albany Molecular Research* | 9,500 | 141,075 | ||||||
Bruker Bioscience Corp.* | 35,000 | 315,350 | ||||||
Dionex Corp.* | 33,400 | 2,371,066 | ||||||
Illumina, Inc.* | 36,583 | 1,484,904 | ||||||
Invitrogen Corp.* | 14,499 | 1,069,301 | ||||||
PAREXEL International Corp.* | 5,200 | 218,712 | ||||||
Pharmanet Development Group, Inc.* | 6,226 | 198,485 | ||||||
Techne Corp.* | 77,918 | 4,457,689 | ||||||
Varian, Inc.* | 16,647 | 912,755 | ||||||
11,169,337 | ||||||||
Machinery (2.4%) | ||||||||
Accuride Corp.* | 36,455 | 561,771 | ||||||
Actuant Corp. | 1,800 | 113,508 | ||||||
ASV, Inc.* | 47,300 | 817,344 | ||||||
Bucyrus International, Inc., Class A | 93,950 | 6,649,781 | ||||||
Chart Industries, Inc.* | 13,300 | 378,252 | ||||||
Clarcor, Inc. | 78,500 | 2,938,255 | ||||||
Dynamic Materials Corp. | 5,100 | 191,250 | ||||||
Enpro Industries, Inc.* | 18,449 | 789,433 | ||||||
Federal Signal Corp. | 15,800 | 250,588 | ||||||
Graco, Inc. | 8,000 | 322,240 | ||||||
Hardinge, Inc. | 11,000 | 374,330 | ||||||
Harsco Corp. | 7,700 | 400,400 | ||||||
Idex Corp. | 8,700 | 335,298 |
Common Stock (continued) | ||||||||
Shares or | ||||||||
Principal Amount | Value | |||||||
UNITED STATES (continued) | ||||||||
Machinery (continued) | ||||||||
Joy Global, Inc. | 26,850 | $ | 1,566,160 | |||||
Kadant, Inc.* | 4,000 | 124,800 | ||||||
Manitowoc Co. | 7,000 | 562,660 | ||||||
Middleby Corp.* | 21,708 | 1,298,573 | ||||||
Mueller Water Products, Inc., Class A | 61,087 | 1,042,144 | ||||||
Nordson Corp. | 18,741 | 940,049 | ||||||
Robbins & Myers, Inc. | 1,707 | 90,693 | ||||||
Sun Hydraulics Corp. | 17,100 | 842,175 | ||||||
Wabtec Corp. | 29,000 | 1,059,370 | ||||||
21,649,074 | ||||||||
Manufacturing (0.1%) | ||||||||
Blount International, Inc.* | 29,100 | 380,628 | ||||||
Darling International, Inc.* | 9,022 | 82,461 | ||||||
L.B. Foster Co.* | 29,200 | 837,456 | ||||||
1,300,545 | ||||||||
Marine (0.1%) | ||||||||
Kirby Corp.* | 13,368 | 513,198 | ||||||
Media (2.1%) | ||||||||
Arbitron, Inc. | 30,480 | 1,570,634 | ||||||
Belo Corp., Class A | 9,400 | 193,546 | ||||||
Charter Communications, Inc.* | 241,579 | 978,395 | ||||||
CKX, Inc.* | 83,657 | 1,156,140 | ||||||
DreamWorks Animation SKG, Inc., Class A* | 29,300 | 845,012 | ||||||
Emmis Communications Corp. | 30,000 | 276,300 | ||||||
Harte-Hanks, Inc. | 28,500 | 731,880 | ||||||
Interactive Data Corp. | 121,099 | 3,243,031 | ||||||
Lakes Entertainment, Inc.* | 65,738 | 776,366 | ||||||
LodgeNet Entertainment Corp.* | 6,396 | 205,056 | ||||||
Mediacom Communications Corp.* | 14,700 | 142,443 | ||||||
Morningstar, Inc.* | 122,444 | 5,757,929 | ||||||
New Frontier Media Inc. | 6,919 | 60,334 | ||||||
ProQuest Co.* | 6,600 | 62,964 | ||||||
RCN Corp. | 10,900 | 204,811 | ||||||
Regal Entertainment Group, Class A | 38,779 | 850,423 | ||||||
Scholastic Corp.* | 12,500 | 449,250 | ||||||
Sinclair Broadcast Group, Inc. | 86,584 | 1,231,225 | ||||||
Westwood One, Inc. | 23,318 | 167,656 | ||||||
18,903,395 | ||||||||
Metals & Mining (2.0%) | ||||||||
A.M. Castle & Co. | 38,800 | 1,393,308 | ||||||
Century Aluminum Co.* | 13,432 | 733,790 | ||||||
Chaparral Steel | 42,392 | 3,046,713 | ||||||
Cleveland Cliffs, Inc. | 6,500 | 504,855 | ||||||
Commercial Metals Co. | 22,300 | 753,071 | ||||||
Compass Minerals International, Inc. | 82,200 | 2,849,052 | ||||||
Gold Reserve, Inc.* | 131,300 | 732,654 | ||||||
Grupo Simec, SA de C.V. ADR - MX* | 68,800 | 858,624 | ||||||
Hecla Mining Co.* | 72,370 | 618,040 | ||||||
IAMGOLD Corp. | 46,800 | 358,488 | ||||||
Kaiser Aluminum Corp. | 28,817 | 2,100,183 | ||||||
Quanex Corp. | 8,300 | 404,210 | ||||||
Reliance Steel & Aluminum Co. | 5,400 | 303,804 | ||||||
Royal Gold, Inc. | 18,800 | 446,876 | ||||||
Steel Dynamics, Inc. | 30,769 | 1,289,529 | ||||||
Worthington Industries, Inc. | 56,100 | 1,214,565 | ||||||
17,607,762 | ||||||||
Multi-Utilities (0.2%) | ||||||||
Avista Corp. | 2,200 | 47,410 | ||||||
C.H. Energy Group, Inc. | 2,300 | 103,431 | ||||||
PNM, Inc. | 29,300 | 814,247 | ||||||
Vectren Corp. | 31,520 | 848,834 | ||||||
1,813,922 | ||||||||
Multiline Retail (0.4%) | ||||||||
Big Lots, Inc.* | 74,773 | 2,199,822 | ||||||
Dollar Tree Stores, Inc.* | 17,297 | 753,284 | ||||||
Tuesday Morning Corp. | 23,200 | 286,752 | ||||||
3,239,858 | ||||||||
Office Electronics (0.2%) | ||||||||
Zebra Technologies Corp., Class A* | 36,547 | 1,415,831 | ||||||
Oil, Gas & Consumable Fuels (3.6%) | ||||||||
Arena Resources, Inc.* | 17,600 | 1,022,736 | ||||||
Aurora Oil & Gas Corp.* | 66,800 | 142,284 | ||||||
Berry Petroleum Co. | 23,400 | 881,712 | ||||||
Bill Barrett Corp.* | 80,900 | 2,979,547 | ||||||
Cabot Oil & Gas Corp. | 6,300 | 232,344 | ||||||
Carrizo Oil & Gas, Inc.* | 66,700 | 2,766,049 | ||||||
Cimarex Energy Co. | 10,000 | 394,100 | ||||||
Comstock Resources, Inc.* | 8,600 | 257,742 | ||||||
Delta Petroleum Corp.* | 82,442 | 1,655,435 | ||||||
Encore Acquisition Co.* | 49,450 | 1,374,710 | ||||||
Evergreen Energy, Inc.* | 155,760 | 939,233 | ||||||
EXCO Resources, Inc.* | 38,700 | 674,928 | ||||||
Foundation Coal Holdings, Inc. | 34,200 | 1,389,888 | ||||||
GMX Resources, Inc.* | 29,234 | 1,011,496 | ||||||
Gulf Island Fabrication, Inc. | 12,800 | 444,160 | ||||||
Harvest Natural Resources, Inc.* | 15,868 | 188,988 | ||||||
Helix Energy Solutions Group, Inc.* | 28,500 | 1,137,435 |
Nationwide Multi-Manager NVIT Small Company Fund (Continued)
Common Stock (continued) | ||||||||
Shares or | ||||||||
Principal Amount | Value | |||||||
UNITED STATES (continued) | ||||||||
Oil, Gas & Consumable Fuels (continued) | ||||||||
Holly Corp. | 12,411 | $ | 920,772 | |||||
Hugoton Royalty Trust | 16,000 | 403,680 | ||||||
Mariner Energy, Inc.* | 1,200 | 29,100 | ||||||
Markwest Hydrocarbon, Inc. | 11,121 | 638,679 | ||||||
Newfield Exploration Co.* | 38,600 | 1,758,230 | ||||||
Parallel Petroleum Corp.* | 35,000 | 766,500 | ||||||
Petrobank Energy & Resources* | 37,500 | 938,250 | ||||||
Petrohawk Energy Corp.* | 110,990 | 1,760,302 | ||||||
RAM Energy Resources, Inc.* | 241,530 | 1,309,093 | ||||||
Rossetta Resources, Inc.* | 9,200 | 198,168 | ||||||
St. Mary Land & Exploration Co. | 85,600 | 3,134,672 | ||||||
Stone Energy Corp.* | 9,800 | 335,748 | ||||||
Swift Energy Co.* | 4,900 | 209,524 | ||||||
Tesoro Petroleum Corp. | 26,452 | 1,511,732 | ||||||
USEC, Inc.* | 47,932 | 1,053,545 | ||||||
Warren Resources, Inc.* | 20,700 | 241,776 | ||||||
32,702,558 | ||||||||
Paper & Forest Products (0.2%) | ||||||||
Buckeye Technologies, Inc.* | 41,557 | 642,887 | ||||||
Deltic Timber Corp. | 18,449 | 1,011,374 | ||||||
1,654,261 | ||||||||
Personal Products (1.0%) | ||||||||
Alberto-Culver Co. | 48,200 | 1,143,304 | ||||||
Bare Escentuals, Inc.* | 53,500 | 1,827,025 | ||||||
Chattem, Inc.* | 3,543 | 224,555 | ||||||
Elizabeth Arden, Inc.* | 25,100 | 608,926 | ||||||
Mannatech, Inc. | 4,100 | 65,149 | ||||||
NBTY, Inc.* | 63,407 | 2,739,183 | ||||||
Physicians Formula Holdings, Inc.* | 54,730 | 860,629 | ||||||
Prestige Brands Holdings, Inc.* | 108,200 | 1,404,436 | ||||||
USANA Health Sciences, Inc.* | 2,400 | 107,376 | ||||||
8,980,583 | ||||||||
Pharmaceuticals (1.1%) | ||||||||
Adams Respiratory Therapeutics, Inc.* | 42,000 | 1,654,380 | ||||||
Biomarin Pharmaceutical, Inc.* | 25,100 | 450,294 | ||||||
Enzon Pharmaceuticals, Inc.* | 22,600 | 177,410 | ||||||
K-V Pharmaceutical Co.* | 29,756 | 810,553 | ||||||
King Pharmaceuticals, Inc.* | 62,230 | 1,273,226 | ||||||
Medicines Co. (The)* | 9,400 | 165,628 | ||||||
Microbia, Inc.* | 93,487 | 584,294 | ||||||
Noven Pharmaceuticals, Inc.* | 48,159 | 1,129,329 | ||||||
OSI Pharmaceuticals, Inc.* | 47,097 | 1,705,382 | ||||||
Pozen, Inc.* | 26,376 | 476,614 | ||||||
Santarus, Inc.* | 15,100 | 78,067 | ||||||
Savient Pharmaceuticals, Inc.* | 9,600 | 119,232 | ||||||
Sciele Pharma, Inc.* | 17,600 | 414,656 | ||||||
Viropharma, Inc.* | 46,771 | 645,440 | ||||||
9,684,505 | ||||||||
Real Estate Investment Trusts (REITs) (3.5%) | ||||||||
Agree Realty Corp. | 946 | 29,563 | ||||||
American Financial Realty Trust | 48,400 | 499,488 | ||||||
American Home Mortgage Investment Corp. | 44,900 | 825,262 | ||||||
Arbor Realty Trust, Inc. | 4,800 | 123,888 | ||||||
Ashford Hospitality Trust | 307,400 | 3,615,024 | ||||||
Biomed Realty Trust, Inc. | 12,150 | 305,208 | ||||||
Capital Trust, Inc., Class A | 12,585 | 429,652 | ||||||
CBL & Associates Properties, Inc. | 29,100 | 1,049,055 | ||||||
CBRE Realty Finance, Inc. | 123,700 | 1,470,793 | ||||||
Cedarshopping Centers, Inc. | 40,280 | 578,018 | ||||||
Cousins Properties, Inc. | 9,200 | 266,892 | ||||||
Deerfield Triarc Capital Corp. | 66,300 | 969,969 | ||||||
Education Realty Trust, Inc. | 15,200 | 213,256 | ||||||
Entertainment Properties Trust | 6,480 | 348,494 | ||||||
Equity Inns, Inc. | 8,700 | 194,880 | ||||||
Equity Lifestyle Properties, Inc. | 25,149 | 1,312,526 | ||||||
Extra Space Storage, Inc. | 25,600 | 422,400 | ||||||
Felcor Lodging Trust, Inc. | 14,200 | 369,626 | ||||||
First Industrial Realty Trust | 53,730 | 2,082,575 | ||||||
Getty Realty Corp. | 5,900 | 155,052 | ||||||
Glimcher Realty Trust | 17,700 | 442,500 | ||||||
Gramercy Capital Corp. | 29,505 | 812,568 | ||||||
Healthcare Realty Trust, Inc. | 14,800 | 411,144 | ||||||
Hersha Hospitality Trust | 107,200 | 1,267,104 | ||||||
Hospitality Properties Trust | 20,700 | 858,843 | ||||||
Inland Real Estate Corp. | 45,200 | 767,496 | ||||||
Investors Real Estate Trust | 9,800 | 101,234 | ||||||
Lasalle Hotel Properties | 10,200 | 442,884 | ||||||
Lexington Corporate Properties Trust | 74,060 | 1,540,448 | ||||||
LTC Properties, Inc. | 17,400 | 395,850 | ||||||
Mack-Cali Realty Corp. | 23,700 | 1,030,713 | ||||||
National Retail Properties, Inc. | 17,280 | 377,741 | ||||||
Nationwide Health Properties, Inc. | 25,300 | 688,160 | ||||||
Omega Healthcare Investors, Inc. | 52,480 | 830,759 | ||||||
Quadra Realty Trust, Inc.* | 129,330 | 1,617,918 | ||||||
Ramco-Gershenson Properties Trust | 6,900 | 247,917 | ||||||
Saul Centers, Inc. | 2,286 | 103,670 | ||||||
Taubman Centers, Inc. | 38,753 | 1,922,536 | ||||||
Urstadt Biddle Properties | 52,100 | 886,221 |
Common Stock (continued) | ||||||||
Shares or | ||||||||
Principal Amount | Value | |||||||
UNITED STATES (continued) | ||||||||
Real Estate Investment Trusts (REITs) (continued) | ||||||||
Washington Real Estate Investment Trust | 44,800 | $ | 1,523,200 | |||||
Winston Hotels, Inc. | 2,196 | 32,940 | ||||||
31,563,467 | ||||||||
Real Estate Management & Development (0.3%) | ||||||||
Affordable Residential Communities* | 20,173 | 238,445 | ||||||
Consolidated Tomoka Land Co. | 10,316 | 714,796 | ||||||
Grubb & Ellis Co.* | 83,046 | 963,334 | ||||||
Housevalues, Inc.* | 80,378 | 367,327 | ||||||
Jones Lang Lasalle, Inc. | 2,620 | 297,370 | ||||||
SonomaWest Holdings, Inc.* | 4,000 | 106,000 | ||||||
2,687,272 | ||||||||
Road & Rail (1.2%) | ||||||||
Arkansas Best Corp. | 5,901 | 229,962 | ||||||
Heartland Express, Inc. | 58,847 | 959,206 | ||||||
J.B. Hunt Transport Services, Inc. | 127,300 | 3,732,436 | ||||||
Kansas City Southern Industries, Inc.* | 119,512 | 4,486,480 | ||||||
Knight Transportation, Inc. | 13,520 | 262,018 | ||||||
Landstar System, Inc. | 14,255 | 687,804 | ||||||
Old Dominion Freight Line, Inc.* | 6,061 | 182,739 | ||||||
Saia, Inc.* | 3,900 | 106,314 | ||||||
10,646,959 | ||||||||
Semiconductors & Semiconductor Equipment (1.4%) | ||||||||
Advanced Energy Industries, Inc.* | 42,437 | 961,622 | ||||||
Amkor Technology, Inc.* | 133,542 | 2,103,287 | ||||||
Brooks Automation, Inc.* | 4,800 | 87,120 | ||||||
Cymer, Inc.* | 6,400 | 257,280 | ||||||
Intevac* | 78,298 | 1,664,616 | ||||||
Micrel, Inc. | 14,100 | 179,352 | ||||||
Microsemi* | 20,000 | 479,000 | ||||||
MKS Instruments, Inc.* | 39,699 | 1,099,662 | ||||||
On Semiconductor Corp.* | 173,951 | 1,864,755 | ||||||
Photronics, Inc.* | 15,000 | 223,200 | ||||||
Power Integrations, Inc.* | 5,500 | 144,100 | ||||||
Silicon Laboratories, Inc.* | 8,500 | 294,185 | ||||||
Spansion, Inc., Class A* | 16,200 | 179,820 | ||||||
Tessera Technologies, Inc.* | 69,984 | 2,837,851 | ||||||
TriQuint Semiconductor, Inc.* | 100,000 | 506,000 | ||||||
Varian Semiconductor Equipment Associates., Inc.* | 2,986 | 119,619 | ||||||
13,001,469 | ||||||||
Service Company (0.1%) | ||||||||
Heidrick & Struggles International, Inc.* | 20,464 | 1,048,575 | ||||||
Software (3.3%) | ||||||||
Advent Software, Inc.* | 3,400 | 110,670 | ||||||
Ansoft Corp.* | 18,393 | 542,409 | ||||||
Blackbaud, Inc. | 212,700 | 4,696,416 | ||||||
Blackboard, Inc.* | 160,033 | 6,740,590 | ||||||
Chordiant Software, Inc.* | 5,001 | 78,316 | ||||||
Citrix Systems, Inc.* | 35,900 | 1,208,753 | ||||||
Concur Technologies, Inc.* | 30,200 | 690,070 | ||||||
Convera Corp., Class A* | 58,505 | 255,082 | ||||||
EPIQ Systems, Inc.* | 103,989 | 1,680,462 | ||||||
FactSet Research Systems, Inc. | 64,150 | 4,384,652 | ||||||
Fair Issac Corp. | 26,675 | 1,070,201 | ||||||
Henry (Jack) & Associates, Inc. | 8,700 | 224,025 | ||||||
MICROS Systems, Inc.* | 73,420 | 3,994,048 | ||||||
NAVTEQ Corp.* | 7,200 | 304,848 | ||||||
SPSS, Inc.* | 10,277 | 453,627 | ||||||
Sybase, Inc.* | 63,385 | 1,514,268 | ||||||
TeleCommunication Systems, Inc.* | 34,310 | 174,295 | ||||||
THQ, Inc.* | 12,700 | 387,604 | ||||||
Tibco Software, Inc.* | 133,500 | 1,208,175 | ||||||
29,718,511 | ||||||||
Specialty Retail (2.7%) | ||||||||
Aeropostale, Inc.* | 1,600 | 66,688 | ||||||
Asbury Automotive Group, Inc. | 31,492 | 785,725 | ||||||
Big 5 Sporting Goods Corp. | 58,000 | 1,479,000 | ||||||
Buckle (The) | 8,828 | 347,823 | ||||||
Casual Male Retail Group, Inc.* | 17,400 | 175,740 | ||||||
Charlotte Russe Holding, Inc.* | 13,100 | 351,997 | ||||||
Circuit City Stores, Inc. | 126,500 | 1,907,620 | ||||||
Citi Trends, Inc.* | 68,876 | 2,614,533 | ||||||
CSK Auto Corp.* | 5,300 | 97,520 | ||||||
Dress Barn, Inc.* | 75,990 | 1,559,315 | ||||||
DSW Inc., Class A* | 16,400 | 571,048 | ||||||
Finish Line, Inc., Class A (The) | 82,900 | 755,219 | ||||||
Group 1 Automotive, Inc. | 17,100 | 689,814 | ||||||
Guess?, Inc. | 3,300 | 158,532 | ||||||
Gymboree* | 46,913 | 1,848,841 | ||||||
Hibbett Sports, Inc.* | 36,900 | 1,010,322 | ||||||
Lithia Motors, Inc., Class A | 11,400 | 288,876 | ||||||
MarineMax, Inc.* | 23,600 | 472,472 | ||||||
Mothers Work, Inc.* | 14,693 | 459,450 | ||||||
O’Reilly Automotive, Inc.* | 95,080 | 3,475,174 | ||||||
Payless ShoeSource, Inc.* | 18,752 | 591,626 | ||||||
Sally Beauty Holdings, Inc.* | 74,300 | 668,700 |
Nationwide Multi-Manager NVIT Small Company Fund (Continued)
Common Stock (continued) | ||||||||
Shares or | ||||||||
Principal Amount | Value | |||||||
UNITED STATES (continued) | ||||||||
Specialty Retail (continued) | ||||||||
Sonic Automotive, Inc. | 13,000 | $ | 376,610 | |||||
Stein Mart, Inc. | 36,900 | 452,394 | ||||||
Talbots, Inc. | 24,300 | 608,229 | ||||||
Tractor Supply Co.* | 27,700 | 1,441,785 | ||||||
Zumiez, Inc.* | 37,900 | 1,431,862 | ||||||
24,686,915 | ||||||||
Telephones (0.0%) | ||||||||
Rural Cellular Corp.* | 1,066 | 46,701 | ||||||
Textiles, Apparel & Luxury Goods (1.0%) | ||||||||
Deckers Outdoor Corp.* | 15,586 | 1,572,627 | ||||||
Fossil, Inc.* | 15,200 | 448,248 | ||||||
Hartmarx Corp.* | 1,200 | 9,564 | ||||||
Heelys, Inc.* | 55,800 | 1,442,988 | ||||||
Kellwood Co. | 38,730 | 1,089,087 | ||||||
Maidenform Brands, Inc.* | 9,187 | 182,454 | ||||||
Perry Ellis International, Inc.* | 19,739 | 635,004 | ||||||
Phillips-Van Heusen Corp. | 22,900 | 1,387,053 | ||||||
Steven Madden Ltd. | 12,600 | 412,776 | ||||||
UniFirst Corp. | 19,100 | 841,355 | ||||||
Warnaco Group, Inc. (The)* | 855 | 33,636 | ||||||
Wolverine World Wide, Inc. | 22,300 | 617,933 | ||||||
8,672,725 | ||||||||
Thrifts & Mortgage Finance (1.0%) | ||||||||
Bank Mutual Corp. | 6,100 | 70,333 | ||||||
BankUnited Financial Corp., Class A | 17,766 | 356,564 | ||||||
City Bank | 4,281 | 134,894 | ||||||
Corus Bankshares, Inc. | 38,984 | 672,864 | ||||||
Delta Financial Corp. | 11,465 | 140,675 | ||||||
Dime Community Bancshares | 68,250 | 900,217 | ||||||
Downey Financial Corp. | 17,251 | 1,138,221 | ||||||
FirstFed Financial Corp.* | 30,125 | 1,708,991 | ||||||
Franklin Bank Corp.* | 31,900 | 475,310 | ||||||
ITLA Capital Corp. | 4,682 | 244,026 | ||||||
KNBT Bancorp, Inc. | 4,600 | 67,620 | ||||||
MAF Bancorp, Inc. | 2,300 | 124,798 | ||||||
Ocwen Financial Corp.* | 60,478 | 806,172 | ||||||
PFF Bancorp, Inc. | 2,000 | 55,860 | ||||||
Tierone Corp. | 10,800 | 325,080 | ||||||
TrustCo Bank Corp. | 25,400 | 250,952 | ||||||
ViewPoint Financial Group | 36,600 | 629,886 | ||||||
Westfield Financial, Inc. | 70,400 | 701,888 | ||||||
WSFS Financial Corp. | 506 | 33,108 | ||||||
8,837,459 | ||||||||
Tobacco (0.2%) | ||||||||
Alliance One International, Inc.* | 5,400 | 54,270 | ||||||
Loews Corp. (Carolina Group | 27,829 | 2,150,347 | ||||||
2,204,617 | ||||||||
Trading Companies & Distributors (0.3%) | ||||||||
Houston Wire & Cable Co.* | 19,200 | 545,472 | ||||||
Interline Brands, Inc.* | 15,800 | 412,064 | ||||||
Kaman Corp., Class A | 18,000 | 561,420 | ||||||
MSC Industrial Direct Co., Class A | 4,200 | 231,000 | ||||||
Rush Enterprises, Inc., Class A* | 8,800 | 191,136 | ||||||
UAP Holding Corp. | 27,600 | 831,864 | ||||||
2,772,956 | ||||||||
Transportation (0.1%) | ||||||||
GulfMark Offshore Services, Inc.* | 10,252 | 525,107 | ||||||
Horizon Lines, Inc. | 2,300 | 75,348 | ||||||
SEACOR Holdings, Inc.* | 3,300 | 308,088 | ||||||
908,543 | ||||||||
Water Utility (0.1%) | ||||||||
Pico Holdings, Inc.* | 15,758 | 681,691 | ||||||
Wireless Telecommunication Services (0.4%) | ||||||||
Dobson Communications Corp., Class A* | 20,700 | 229,977 | ||||||
Fibertower Corp.* | 66,726 | 288,924 | ||||||
Novatel Wireless, Inc.* | 5,800 | 150,916 | ||||||
SBA Communications Corp.* | 76,827 | 2,580,619 | ||||||
Tessco Technologies, Inc.* | 16,901 | 328,217 | ||||||
3,578,653 | ||||||||
658,581,736 | ||||||||
Total Common Stocks (Cost $711,819,197) | 879,319,970 | |||||||
Commercial Paper (0.1%) | ||||||||
United States (0.1%) | ||||||||
Countrywide Home Loans, 5.40%, 07/02/07 | $ | 1,487,000 | 1,486,554 | |||||
Mutual Funds (0.3%) | ||||||||
Shares or | ||||||||
Principal Amount | Value | |||||||
Macquarie Infrastructure Co. LLC | 59,251 | $ | 2,457,731 | |||||
Exchange Traded Fund (0.1%) | ||||||||
iShares MSCI EAFE Index Fund | $ | 12,000 | 967,560 | |||||
Cash Equivalent (1.9%) (a) | ||||||||
AIM Liquid Assets Portfolio, 5.09%, 04/01/42 | 17,210,131 | 17,210,131 | ||||||
Total Investments (Cost $733,290,069) (b) — 99.8% | 901,441,946 | |||||||
Other assets in excess of liabilities — 0.2% | 1,443,266 | |||||||
NET ASSETS — 100.0% | $ | 902,885,212 | ||||||
* | Denotes a non-income producing security. | |
(a) | Variable Rate Security. The rate reflected in the Statement of Investments is the rate in effect on June 30, 2007. The maturity date represents the actual maturity date. | |
(b) | See notes to financial statements for tax unrealized appreciation (depreciation) of securities. |
ADR | American Depository Receipt | |
BM | Bermuda | |
BR | Brazil | |
CA | Canada | |
IE | Ireland | |
KR | Korea |
See accompanying notes to financial statements.
Nationwide | ||||||
Multi-Manager | ||||||
NVIT | ||||||
Small Company Fund | ||||||
Assets: | ||||||
Investments, at value (cost $733,290,069) | $ | 901,441,946 | ||||
Cash | 10,875 | |||||
Foreign currencies, at value (cost $356,532) | 357,244 | |||||
Interest and dividends receivable | 893,113 | |||||
Receivable for capital shares issued | 206,959 | |||||
Receivable for investments sold | 6,139,503 | |||||
Reclaims receivable | 109,085 | |||||
Prepaid expenses | 9,383 | |||||
Total Assets | 909,168,108 | |||||
Liabilities: | ||||||
Payable for investments purchased | 5,046,202 | |||||
Payable for capital shares redeemed | 317,526 | |||||
Accrued expenses and other payables: | ||||||
Investment advisory fees | 695,974 | |||||
Fund administration and transfer agent fees | 75,244 | |||||
Distribution fees | 22,703 | |||||
Administrative servicing fees | 29,400 | |||||
Compliance program costs | 11,748 | |||||
Other | 84,099 | |||||
Total Liabilities | 6,282,896 | |||||
Net Assets | $ | 902,885,212 | ||||
Represented by: | ||||||
Capital | $ | 666,836,327 | ||||
Accumulated net investment income | 1,840,903 | |||||
Accumulated net realized gains from investment transactions and foreign currency transactions | 66,055,621 | |||||
Net unrealized appreciation on investments and translation of assets and liabilities denominated in foreign currencies | 168,152,361 | |||||
Net Assets | $ | 902,885,212 | ||||
Net Assets: | ||||||
Class I Shares | $ | 743,487,234 | ||||
Class II Shares | 111,432,999 | |||||
Class III Shares | 4,397,780 | |||||
Class IV Shares | 43,567,199 | |||||
Total | $ | 902,885,212 | ||||
Shares outstanding (unlimited number of shares authorized): | ||||||
Class I Shares | 31,240,549 | |||||
Class II Shares | 4,760,365 | |||||
Class III Shares | 184,673 | |||||
Class IV Shares | 1,830,785 | |||||
Total | 38,016,372 | |||||
Net asset value and offering price per share (Net assets by class divided by shares outstanding by class, respectively.): | ||||||
Class I Shares | $ | 23.80 | ||||
Class II Shares | $ | 23.41 | ||||
Class III Shares | $ | 23.81 | ||||
Class IV Shares | $ | 23.80 | ||||
24
Nationwide | |||||
Multi-Manager NVIT | |||||
Small Company Fund | |||||
INVESTMENT INCOME: | |||||
Interest income | $ | 399,571 | |||
Dividend income | 7,005,751 | ||||
Foreign tax withholding | (328,002 | ) | |||
Total Income | 7,077,320 | ||||
Expenses: | |||||
Investment advisory fees | 4,130,806 | ||||
Fund administration and transfer agent fees | 302,584 | ||||
Distribution fees Class II Shares | 124,896 | ||||
Administrative servicing fees Class I Shares | 490,294 | ||||
Administrative servicing fees Class II Shares | 60,649 | ||||
Administrative servicing fees Class III Shares | 3,680 | ||||
Administrative servicing fees Class IV Shares | 28,037 | ||||
Custodian fees | 62,691 | ||||
Trustee fees | 20,788 | ||||
Compliance program costs (Note 3) | 6,162 | ||||
Other | 94,200 | ||||
Total expenses before earnings credit | 5,324,787 | ||||
Earnings credit (Note 6) | (6,118 | ) | |||
Net Expenses | 5,318,669 | ||||
Net Investment Income | 1,758,651 | ||||
REALIZED/ UNREALIZED GAINS (LOSSES) FROM INVESTMENTS: | |||||
Net realized gains on investment transactions | 77,827,119 | ||||
Net realized (losses) on foreign currency transactions | (1,473,959 | ) | |||
Net realized gains on investment transactions and foreign currency transactions | 76,353,160 | ||||
Net change in unrealized appreciation on investments and translation of assets and liabilities denominated in foreign currencies | 1,248,465 | ||||
Net realized/unrealized gains (losses) on investments and translation of assets and liabilities denominated in foreign currencies | 77,601,625 | ||||
CHANGE IN NET ASSETS RESULTING FROM OPERATIONS | $ | 79,360,276 | |||
25
Nationwide Multi-Manager | |||||||||
NVIT Small Company Fund | |||||||||
Six Months Ended | Year Ended | ||||||||
June 30, 2007 | December 31, 2006 | ||||||||
(Unaudited) | |||||||||
FROM INVESTMENT ACTIVITIES: | |||||||||
Operations: | |||||||||
Net investment income | $ | 1,758,651 | $ | 856,635 | |||||
Net realized gains on investment transactions and foreign currency transactions | 76,353,160 | 117,152,412 | |||||||
Net change in unrealized appreciation/depreciation on investments and translation of assets and liabilities denominated in foreign currencies | 1,248,465 | (12,726,165 | ) | ||||||
Change in net assets resulting from operations | 79,360,276 | 105,282,882 | |||||||
Distributions to shareholders from: | |||||||||
Net investment income: | |||||||||
Class I | – | (812,010 | ) | ||||||
Class II | – | (56,733 | ) | ||||||
Class III | – | (6,907 | ) | ||||||
Class IV | – | (47,918 | ) | ||||||
Net realized gains on investments: | |||||||||
Class I | (95,291,801 | ) | (15,390,122 | ) | |||||
Class II | (14,368,708 | ) | (1,643,475 | ) | |||||
Class III | (572,275 | ) | (63,680 | ) | |||||
Class IV | (5,564,619 | ) | (804,451 | ) | |||||
Change in net assets from shareholder distributions | (115,797,403 | ) | (18,825,296 | ) | |||||
Change in net assets from capital transactions | 36,205,025 | (135,037,451 | ) | ||||||
Change in net assets | (232,102 | ) | (48,579,865 | ) | |||||
Net Assets: | |||||||||
Beginning of period | 903,117,314 | 951,697,179 | |||||||
End of period | $ | 902,885,212 | $ | 903,117,314 | |||||
Accumulated net investment income at end of period | $ | 1,840,903 | $ | 82,252 | |||||
CAPITAL TRANSACTIONS: | |||||||||
Class I Shares | |||||||||
Proceeds from shares issued | $ | 19,292,022 | $ | 58,049,219 | |||||
Dividends reinvested | 95,291,784 | 16,205,471 | |||||||
Cost of shares redeemed | (91,510,792 | ) | (230,208,135 | ) | |||||
23,073,014 | (155,953,445 | ) | |||||||
Class II Shares | |||||||||
Proceeds from shares issued | 16,681,917 | 49,421,395 | |||||||
Dividends reinvested | 14,368,705 | 1,700,202 | |||||||
Cost of shares redeemed | (20,574,012 | ) | (27,450,058 | ) | |||||
10,476,610 | 23,671,539 | ||||||||
Class III Shares | |||||||||
Proceeds from shares issued | 948,844 | 4,715,218 | |||||||
Dividends reinvested | 572,275 | 70,587 | |||||||
Cost of shares redeemed | (1,793,205 | ) | (2,685,385 | ) | |||||
(272,086 | ) | 2,100,420 | |||||||
26
Nationwide Multi-Manager | |||||||||
NVIT Small Company Fund | |||||||||
Six Months Ended | Year Ended | ||||||||
June 30, 2007 | December 31, 2006 | ||||||||
(Unaudited) | |||||||||
CAPITAL TRANSACTIONS: (continued) | |||||||||
Class IV Shares | |||||||||
Proceeds from shares issued | $ | 1,103,303 | $ | 1,977,093 | |||||
Dividends reinvested | 5,564,618 | 852,366 | |||||||
Cost of shares redeemed | (3,740,434 | ) | (7,685,424 | ) | |||||
2,927,487 | (4,855,965 | ) | |||||||
Change in net assets from capital transactions | $ | 36,205,025 | $ | (135,037,451 | ) | ||||
SHARE TRANSACTIONS: | |||||||||
Class I Shares | |||||||||
Issued | 738,183 | 2,399,643 | |||||||
Reinvested | 4,042,927 | 712,208 | |||||||
Redeemed | (3,514,515 | ) | (9,654,743 | ) | |||||
1,266,595 | (6,542,892 | ) | |||||||
Class II Shares | |||||||||
Issued | 640,311 | 2,130,983 | |||||||
Reinvested | 619,608 | 75,786 | |||||||
Redeemed | (830,616 | ) | (1,167,578 | ) | |||||
429,303 | 1,039,191 | ||||||||
Class III Shares | |||||||||
Issued | 35,650 | 193,944 | |||||||
Reinvested | 24,259 | 3,085 | |||||||
Redeemed | (70,417 | ) | (113,616 | ) | |||||
(10,508 | ) | 83,413 | |||||||
Class IV Shares | |||||||||
Issued | 42,439 | 83,535 | |||||||
Reinvested | 236,089 | 37,437 | |||||||
Redeemed | (143,560 | ) | (321,992 | ) | |||||
134,968 | (201,020 | ) | |||||||
Total change in shares | 1,820,358 | (5,621,308 | ) | ||||||
27
Distributions | ||||||||||||||||||||
Investment Activities | ||||||||||||||||||||
Net Realized | ||||||||||||||||||||
and | ||||||||||||||||||||
Net Asset | Net | Unrealized | Total | |||||||||||||||||
Value, | Investment | Gains | from | Net | ||||||||||||||||
Beginning | Income | (Losses) on | Investment | Investment | ||||||||||||||||
of Period | (Loss) | Investments | Activities | Income | ||||||||||||||||
Class I Shares | ||||||||||||||||||||
For the year ended December 31, 2002 | $ | 18.64 | (0.07 | ) | (3.16 | ) | (3.23 | ) | – | |||||||||||
For the year ended December 31, 2003 | $ | 15.41 | (0.07 | ) | 6.39 | 6.32 | – | |||||||||||||
For the year ended December 31, 2004 | $ | 21.73 | (0.04 | ) | 4.17 | 4.13 | – | |||||||||||||
For the year ended December 31, 2005 | $ | 22.96 | (0.03 | ) | 2.84 | 2.81 | – | |||||||||||||
For the year ended December 31, 2006 | $ | 22.78 | 0.03 | 2.67 | 2.70 | (0.03 | ) | |||||||||||||
For the six months ended June 30, 2007 (Unaudited) | $ | 24.99 | 0.05 | 2.25 | 2.30 | – | ||||||||||||||
Class II Shares | ||||||||||||||||||||
Period ended December 31, 2002 (e) | $ | 18.70 | (0.03 | ) | (3.28 | ) | (3.31 | ) | – | |||||||||||
For the year ended December 31, 2003 | $ | 15.39 | (0.12 | ) | 6.37 | 6.25 | – | |||||||||||||
For the year ended December 31, 2004 | $ | 21.64 | (0.07 | ) | 4.13 | 4.06 | – | |||||||||||||
For the year ended December 31, 2005 | $ | 22.80 | (0.07 | ) | 2.79 | 2.72 | – | |||||||||||||
For the year ended December 31, 2006 | $ | 22.53 | (0.03 | ) | 2.63 | 2.60 | (0.01 | ) | ||||||||||||
For the six months ended June 30, 2007 (Unaudited) | $ | 24.66 | 0.02 | 2.22 | 2.24 | – |
[Additional columns below]
[Continued from above table, first column(s) repeated]
Distributions | ||||||||||||||||||||||||
Ratio of | ||||||||||||||||||||||||
Net Assets | Expenses to | |||||||||||||||||||||||
Net | Net Asset | at End of | Average | |||||||||||||||||||||
realized | Total | Value, End | Total | Period | Net | |||||||||||||||||||
gains | Distributions | of Period | Return (a) | (000s) | Assets (b) | |||||||||||||||||||
Class I Shares | ||||||||||||||||||||||||
For the year ended December 31, 2002 | – | – | $ | 15.41 | (17.33% | ) | $ | 561,836 | 1.18% | |||||||||||||||
For the year ended December 31, 2003 | – | – | $ | 21.73 | 41.01% | $ | 760,078 | 1.17% | ||||||||||||||||
For the year ended December 31, 2004 | (2.90 | ) | (2.90 | ) | $ | 22.96 | 19.02% | $ | 815,585 | 1.19% | ||||||||||||||
For the year ended December 31, 2005 | (2.99 | ) | (2.99 | ) | $ | 22.78 | 12.32% | $ | 831,778 | 1.20% | ||||||||||||||
For the year ended December 31, 2006 | (0.46 | ) | (0.49 | ) | $ | 24.99 | 12.04% | $ | 749,048 | 1.19% | ||||||||||||||
For the six months ended June 30, 2007 (Unaudited) | (3.49 | ) | (3.49 | ) | $ | 23.80 | 9.34% | $ | 743,487 | 1.17% | ||||||||||||||
Class II Shares | ||||||||||||||||||||||||
Period ended December 31, 2002 (e) | – | – | $ | 15.39 | (17.70% | ) | $ | 2,325 | 1.44% | |||||||||||||||
For the year ended December 31, 2003 | – | – | $ | 21.64 | 40.61% | $ | 18,345 | 1.42% | ||||||||||||||||
For the year ended December 31, 2004 | (2.90 | ) | (2.90 | ) | $ | 22.80 | 18.78% | $ | 46,906 | 1.44% | ||||||||||||||
For the year ended December 31, 2005 | (2.99 | ) | (2.99 | ) | $ | 22.53 | 12.01% | $ | 74,165 | 1.45% | ||||||||||||||
For the year ended December 31, 2006 | (0.46 | ) | (0.47 | ) | $ | 24.66 | 11.75% | $ | 106,813 | 1.45% | ||||||||||||||
For the six months ended June 30, 2007 (Unaudited) | (3.49 | ) | (3.49 | ) | $ | 23.41 | 9.22% | $ | 111,433 | 1.41% |
[Additional columns below]
[Continued from above table, first column(s) repeated]
Ratios/Supplemental Data | ||||||||||||||||||
Ratio of | ||||||||||||||||||
Ratio of | Investment | |||||||||||||||||
Ratio of Net | Expenses | Income (Loss) | ||||||||||||||||
Investment | (Prior to | (Prior to | ||||||||||||||||
Income (Loss) | Reimbursements) | Reimbursements) | ||||||||||||||||
to Average | to Average | to Average | Portfolio | |||||||||||||||
Net Assets (b) | Net Assets (b)(c) | Net Assets (b)(c) | Turnover(d) | |||||||||||||||
Class I Shares | ||||||||||||||||||
For the year ended December 31, 2002 | (0.33% | ) | (g) | (g) | 92.59% | |||||||||||||
For the year ended December 31, 2003 | (0.37% | ) | (g) | (g) | 93.72% | |||||||||||||
For the year ended December 31, 2004 | (0.17% | ) | (g) | (g) | 131.75% | |||||||||||||
For the year ended December 31, 2005 | (0.12% | ) | (g) | (g) | 128.34% | |||||||||||||
For the year ended December 31, 2006 | 0.11% | (g) | (g) | 104.59% | ||||||||||||||
For the six months ended June 30, 2007 (Unaudited) | 0.42% | 1.17% | 0.42% | 54.25% | ||||||||||||||
Class II Shares | ||||||||||||||||||
Period ended December 31, 2002 (e) | (0.54% | ) | (g) | (g) | 92.59% | |||||||||||||
For the year ended December 31, 2003 | (0.63% | ) | (g) | (g) | 93.72% | |||||||||||||
For the year ended December 31, 2004 | (0.42% | ) | (g) | (g) | 131.75% | |||||||||||||
For the year ended December 31, 2005 | (0.37% | ) | (g) | (g) | 128.34% | |||||||||||||
For the year ended December 31, 2006 | (0.12% | ) | (g) | (g) | 104.59% | |||||||||||||
For the six months ended June 30, 2007 (Unaudited) | 0.19% | 1.41% | 0.19% | 54.25% |
[Additional columns below]
[Continued from above table, first column(s) repeated]
(a) | Not annualized for periods less than one year. |
(b) | Annualized for periods less than one year. |
(c) | During the period, certain fees were waived and/or reimbursed. If such waivers/reimbursements had not occurred, the ratios would have been as indicated. |
(d) | Portfolio turnover is calculated on the basis of the Fund as a whole without distinguishing among the classes of shares. |
(e) | For the period from March 5, 2002 (commencement of operations) through December 31, 2002. |
(f) | For the period from July 1, 2002 (commencement of operations) through December 31, 2002. |
(g) | There were no fee reductions during the period. |
(h) | For the period from April 28, 2003 (commencement of operations) through December 31, 2003. |
Distributions | ||||||||||||||||||||
Investment Activities | ||||||||||||||||||||
Net Realized | ||||||||||||||||||||
and | ||||||||||||||||||||
Net Asset | Net | Unrealized | Total | |||||||||||||||||
Value, | Investment | Gains | from | Net | ||||||||||||||||
Beginning | Income | (Losses) on | Investment | Investment | ||||||||||||||||
of Period | (Loss) | Investments | Activities | Income | ||||||||||||||||
Class III Shares | ||||||||||||||||||||
Period ended December 31, 2002 (f) | $ | 17.48 | (0.01 | ) | (2.05 | ) | (2.06 | ) | – | |||||||||||
For the year ended December 31, 2003 | $ | 15.42 | (0.08 | ) | 6.40 | 6.32 | – | |||||||||||||
For the year ended December 31, 2004 | $ | 21.74 | (0.03 | ) | 4.17 | 4.14 | – | |||||||||||||
For the year ended December 31, 2005 | $ | 22.98 | (0.02 | ) | 2.83 | 2.81 | – | |||||||||||||
For the year ended December 31, 2006 | $ | 22.80 | 0.03 | 2.68 | 2.71 | (0.04 | ) | |||||||||||||
For the six months ended June 30, 2007 (Unaudited) | $ | 25.01 | 0.04 | 2.25 | 2.29 | – | ||||||||||||||
Class IV Shares | ||||||||||||||||||||
Period ended December 31, 2003 (h) | $ | 15.61 | (0.05 | ) | 6.17 | 6.12 | – | |||||||||||||
For the year ended December 31, 2004 | $ | 21.73 | (0.04 | ) | 4.17 | 4.13 | – | |||||||||||||
For the year ended December 31, 2005 | $ | 22.96 | (0.03 | ) | 2.84 | 2.81 | – | |||||||||||||
For the year ended December 31, 2006 | $ | 22.78 | 0.03 | 2.67 | 2.70 | (0.03 | ) | |||||||||||||
For the six months ended June 30, 2007 (Unaudited) | $ | 24.99 | 0.05 | 2.25 | 2.30 | – | ||||||||||||||
[Additional columns below]
[Continued from above table, first column(s) repeated]
Distributions | ||||||||||||||||||||||||
Ratio of | ||||||||||||||||||||||||
Net Assets | Expenses to | |||||||||||||||||||||||
Net | Net Asset | at End of | Average | |||||||||||||||||||||
realized | Total | Value, End | Total | Period | Net | |||||||||||||||||||
gains | Distributions | of Period | Return (a) | (000s) | Assets (b) | |||||||||||||||||||
Class III Shares | ||||||||||||||||||||||||
Period ended December 31, 2002 (f) | – | – | $ | 15.42 | (11.78% | ) | $ | 51 | 1.15% | |||||||||||||||
For the year ended December 31, 2003 | – | – | $ | 21.74 | 40.99% | $ | 1,199 | 1.17% | ||||||||||||||||
For the year ended December 31, 2004 | (2.90 | ) | (2.90 | ) | $ | 22.98 | 19.06% | $ | 1,681 | 1.19% | ||||||||||||||
For the year ended December 31, 2005 | (2.99 | ) | (2.99 | ) | $ | 22.80 | 12.31% | $ | 2,548 | 1.22% | ||||||||||||||
For the year ended December 31, 2006 | (0.46 | ) | (0.50 | ) | $ | 25.01 | 12.06% | $ | 4,881 | 1.18% | ||||||||||||||
For the six months ended June 30, 2007 (Unaudited) | (3.49 | ) | (3.49 | ) | $ | 23.81 | 9.29% | $ | 4,398 | 1.21% | ||||||||||||||
Class IV Shares | ||||||||||||||||||||||||
Period ended December 31, 2003 (h) | – | – | $ | 21.73 | 39.21% | $ | 48,252 | 1.16% | ||||||||||||||||
For the year ended December 31, 2004 | (2.90 | ) | (2.90 | ) | $ | 22.96 | 19.02% | $ | 44,819 | 1.19% | ||||||||||||||
For the year ended December 31, 2005 | (2.99 | ) | (2.99 | ) | $ | 22.78 | 12.32% | $ | 43,206 | 1.20% | ||||||||||||||
For the year ended December 31, 2006 | (0.46 | ) | (0.49 | ) | $ | 24.99 | 12.04% | $ | 42,375 | 1.19% | ||||||||||||||
For the six months ended June 30, 2007 (Unaudited) | (3.49 | ) | (3.49 | ) | $ | 23.80 | 9.34% | $ | 43,567 | 1.17% | ||||||||||||||
[Additional columns below]
[Continued from above table, first column(s) repeated]
Ratios/Supplemental Data | ||||||||||||||||||
Ratio of | ||||||||||||||||||
Ratio of | Investment | |||||||||||||||||
Ratio of Net | Expenses | Income (Loss) | ||||||||||||||||
Investment | (Prior to | (Prior to | ||||||||||||||||
Income (Loss) | Reimbursements) | Reimbursements) | ||||||||||||||||
to Average | to Average | to Average | Portfolio | |||||||||||||||
Net Assets (b) | Net Assets (b)(c) | Net Assets (b)(c) | Turnover(d) | |||||||||||||||
Class III Shares | ||||||||||||||||||
Period ended December 31, 2002 (f) | (0.25% | ) | (g) | (g) | 92.59% | |||||||||||||
For the year ended December 31, 2003 | (0.39% | ) | (g) | (g) | 93.72% | |||||||||||||
For the year ended December 31, 2004 | (0.15% | ) | (g) | (g) | 131.75% | |||||||||||||
For the year ended December 31, 2005 | (0.14% | ) | (g) | (g) | 128.34% | |||||||||||||
For the year ended December 31, 2006 | 0.16% | (g) | (g) | 104.59% | ||||||||||||||
For the six months ended June 30, 2007 (Unaudited) | 0.34% | 1.21% | 0.34% | 54.25% | ||||||||||||||
Class IV Shares | ||||||||||||||||||
Period ended December 31, 2003 (h) | (0.36% | ) | (g) | (g) | 93.72% | |||||||||||||
For the year ended December 31, 2004 | (0.18% | ) | (g) | (g) | 131.75% | |||||||||||||
For the year ended December 31, 2005 | (0.12% | ) | (g) | (g) | 128.34% | |||||||||||||
For the year ended December 31, 2006 | 0.12% | (g) | (g) | 104.59% | ||||||||||||||
For the six months ended June 30, 2007 (Unaudited) | 0.43% | 1.17% | 0.43% | 54.25% | ||||||||||||||
(a) | Not annualized for periods less than one year. | |
(b) | Annualized for periods less than one year. | |
(c) | During the period, certain fees were waived and/or reimbursed. If such waivers/reimbursements had not occurred, the ratios would have been as indicated. | |
(d) | Portfolio turnover is calculated on the basis of the Fund as a whole without distinguishing among the classes of shares. | |
(e) | For the period from March 5, 2002 (commencement of operations) through December 31, 2002. | |
(f) | For the period from July 1, 2002 (commencement of operations) through December 31, 2003. | |
(g) | There were no fee reductions during the period. | |
(h) | For the period from April 28, 2003 (commencement of operations) through December 31, 2003. |
See accompanying notes to financial statements.
1. Organization
Nationwide Variable Insurance Trust (“NVIT” or the “Trust”) is an open-end management investment company, organized under the laws of Delaware by an amended and restated Agreement and Declaration of Trust, dated October 28, 2004, as amended to date. Prior to May 1, 2007, the Trust was named “Gartmore Variable Insurance Trust”. The Trust, originally created under the laws of Massachusetts as a Massachusetts business trust pursuant to a Declaration of Trust dated, as of June 30, 1981, and as subsequently amended, redomesticated as a Delaware Statutory Trust after the close of trading on April 29, 2005, and is registered under the Investment Company Act of 1940, as amended (the “1940 Act”). The redomestication was a change in statutory status and did not affect the operations of the Trust. As of June 30, 2007, the Trust had authorized an unlimited number of shares of beneficial interest, without par value (“shares”). The Trust currently offers shares to life insurance company separate accounts to fund the benefits under variable life insurance or annuity policies. To date, only the separate accounts of Nationwide Life Insurance Company and Nationwide Life and Annuity Insurance Company (collectively, “Nationwide”) have purchased shares of the Nationwide Multi-Manager NVIT Small Company Fund (the “Fund”), (formerly, “GVIT Small Company Fund”). The Trust currently operates forty (40) separate series, or mutual funds, each with its own investment objectives and strategies. This report contains the financial statements and financial highlights of the Fund.
2. Summary of Significant Accounting Policies
The following is a summary of significant accounting policies followed by the Fund in the preparation of its financial statements. The policies are in conformity with accounting principles generally accepted in the United States of America (“GAAP”). The preparation of financial statements requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of income and expenses for the period. Actual results could differ from those estimates.
(a) | Security Valuation |
Securities for which market quotations are readily available are valued at current market value as of “Valuation Time.” Valuation Time is as of the close of regular trading on the New York Stock Exchange (usually 4 p.m. Eastern time). Equity securities are valued at the last quoted sale price or, if there is no sale price, the last quoted bid price provided by an independent pricing service approved by the Trust’s Board of Trustees (“Board of Trustees”). Securities traded on NASDAQ are valued at the NASDAQ official closing price. Prices are taken from the primary market or exchange in which each security trades. Investment companies are valued at net asset value as reported by such company. | |
Most securities listed on a foreign exchange are valued either at fair value (see description below) or at the last sale price at the close of the exchange on which the security is principally traded. Foreign securities, currencies, and other assets and liabilities denominated in foreign currencies are translated into U.S. dollars at the exchange rate of said currencies against the U.S. dollar, as of Valuation Time, as provided by an independent pricing service approved by the Board of Trustees. | |
Debt (including defaulted issues) and other fixed income securities (other than short-term obligations) are valued at the last quoted bid price and/or by using a combination of daily quotes and matrix evaluations provided by an independent pricing service, the use of which has been approved by the Board of Trustees. Short-term debt securities, such as commercial paper and U.S. Treasury Bills having a remaining maturity of 60 days or less at the time of purchase, are considered to be “short-term” and are valued at amortized cost, which approximates market value. | |
Securities for which market quotations are not readily available, or for which an independent pricing service does not provide a value or provides a value that does not represent fair value in the judgment of the Fund’s investment adviser or designee, are valued at fair value under procedures approved by the Board of Trustees. The “Fair Value” of these securities is determined in good faith by taking into account relevant factors and surrounding circumstances. Methods utilized to obtain a “Fair Value” may include the following non-exclusive list of acceptable methods: (i) a |
multiple of earnings; (ii) the discount from market value of a similar, freely traded security; (iii) the yield-to-maturity for debt issues; or (iv) a consolidation of the methods. The Trust’s Valuation & Operations Committee considers a non-exclusive list of factors to arrive at the appropriate method of determining “Fair Value.” For example, fair value determinations are required for securities whose value is affected by a “significant” event that materially affects the value of a domestic or foreign security which occurs subsequent to the time of the close of the principal market on which such domestic or foreign security trades and before the Valuation Time (i.e., a “subsequent event”). Typically, this will involve events occurring after the close of a foreign market on which a security trades and before the next Valuation Time. | |
The Fund values foreign securities at fair value in the circumstances described below. Generally, trading in foreign securities markets is completed each day at various times prior to the Valuation Time. Due to the time differences between the closings of the relevant foreign securities exchanges and the Valuation Time for the Fund, the Fund will fair value its foreign investments when it is determined that the market quotations for the foreign investments either are not readily available or are unreliable and, therefore, do not represent fair value. When the fair value prices are utilized, these prices will attempt to reflect the impact of the U.S. financial markets’ perceptions and trading activities on the Fund’s foreign investments since the last closing prices of the foreign investments were calculated on their primary foreign securities markets or exchanges. For these purposes, the Board of Trustees has determined that movements in relevant indices or other appropriate market indicators, after the close of the foreign securities exchanges, may demonstrate that market quotations are unreliable, and may trigger fair value pricing for certain securities. Consequently, fair valuation of portfolio securities may occur on a daily basis. |
(b) | Repurchase Agreements |
The Fund may enter into repurchase agreements with an entity which is a member of the Federal Reserve System or which is a “primary dealer” (as designated by the Federal Reserve Bank of New York) in U.S. Government obligations. The repurchase price generally equals the price paid by the Fund plus interest negotiated on the basis of current short-term rates, which may be more or less than the rate on the underlying portfolio securities. The seller under a repurchase agreement is required to maintain the value of the collateral held pursuant to the agreement at a market value equal to or greater than the repurchase price (including accrued interest). Collateral subject to repurchase agreements is held by the Fund’s custodian or another qualified sub-custodian or in the Federal Reserve/ Treasury book-entry system. If the counterparty defaults and the fair value of the collateral declines, realization of the collateral by the Fund may be delayed or limited. The Fund may transfer uninvested cash balances into a pooled cash account. These balances are invested in one or more repurchase agreements, with the counterparty of Nomura Securities, which is fully collateralized by U.S. Government Agency Mortgages. |
(c) | Foreign Currency Transactions |
The accounting records of the Fund are maintained in U.S. dollars. Foreign currency amounts are translated into U.S. dollars at the current rate of exchange to determine the value of investments, assets and liabilities. The Fund may enter into foreign currency contracts in connection with purchases or sales of securities denominated in a foreign currency. Purchases and sales of securities, and income and expenses, are translated at the prevailing rate of exchange on the respective date of these transactions. The Fund does not isolate that portion of the results of operations resulting from changes in foreign exchange rates on investments from fluctuations arising from changes in market prices of securities held. These fluctuations are included with the net realized and unrealized gain or loss from investments and foreign currencies. |
(d) | Forward Foreign Currency Contracts |
The Fund may enter into forward foreign currency contracts in connection with planned purchases or sales of securities or to hedge the U.S. dollar value of portfolio securities denominated in a particular currency. The Fund could be exposed to risks if the counterparties to the contracts are unable to meet the terms of their contracts and from unanticipated movements in the value of a foreign currency relative to the U.S. dollar. Forward foreign currency |
contracts are valued at the current cost of covering these contracts, as provided by an independent pricing service approved by the Board of Trustees. The forward foreign currency contracts are adjusted by the daily exchange rate of the underlying currency and any gains or losses are recorded for financial statement purposes as unrealized gains or losses until the contract settlement date. |
(e) | Futures Contracts |
The Fund may invest in financial futures contracts (“futures contracts”) for the purpose of hedging its existing portfolio securities or securities that the Fund intends to purchase against fluctuations in value caused by changes in prevailing market interest rates or prices. Futures contracts may also be entered into for non-hedging purposes. | |
Upon entering into a futures contract, the Fund is required to pledge to the broker an amount of cash and/or other assets equal to a certain percentage of the contract amount (initial margin deposit). Subsequent payments, known as “variation margin,” are made each day, depending on the daily fluctuations in the fair value/market value of the underlying assets. A gain or loss equal to the daily variation margin is recognized on a daily basis. Futures contracts are valued daily at their last quoted sale price. | |
A “sale” of a futures contract means the creation of a contractual obligation to deliver the securities or foreign currency called for by the contract at a fixed price at a specified time in the future. A “purchase” of a futures contract means the creation of a contractual obligation to acquire the securities or foreign currency at a fixed price at a specified time in the future. | |
Should market conditions change unexpectedly, the Fund may not achieve the anticipated benefits of the futures contracts and may realize a loss. The use of futures transactions for hedging purposes involves the risk of imperfect correlation in movements in the price of futures contracts, interest rates, and the value of the underlying hedged assets. |
(f) | Written Options Contracts |
The Fund may write options contracts. A written option obligates the Fund to deliver (written call) or to receive (written put) a specified quantity of an underlying asset at the contract amount upon exercise by the holder of the option. When the Fund writes an option, an amount equal to the premium received by the Fund is recorded as a liability and is subsequently adjusted to the current fair value of the option written. Premiums received from writing options that expire unexercised are treated by the Fund on the expiration date as realized gains from investments. The difference between the premium and the amount paid on effecting a closing purchase transaction, as a realized loss. If a call option is exercised, the premium is added to the proceeds from the sale of the underlying security or currency in determining whether the Fund has realized a gain or loss. If a put option is exercised, the premium reduces the cost basis of the securities purchased by the Fund. Options traded on an exchange are valued at the last quoted sale price, or in the absence of a sale, the bid price provided by an independent pricing service approved by the Board of Trustees. Non-exchange traded options are valued using dealer supplied quotes. The Fund as a writer of an option bears the market risk of an unfavorable change in the price of the security underlying the written option. |
(g) | Mortgage Dollar Rolls |
The Fund may enter into mortgage “dollar rolls” in which the Fund sells mortgage-backed securities for delivery in the current month and simultaneously contracts to repurchase substantially similar (same type, coupon, and maturity) securities on a specified future date. Mortgage dollar rolls may be implemented in the “to be announced” (“TBA”) market and are referred to as TBA’s on the Statement of Investments of the Fund. During the roll period, the Fund foregoes principal and interest paid on the mortgage-backed securities. Each mortgage dollar roll is treated as a financing transaction; therefore, any gain or loss is considered unrealized until the roll reaches completion. Risks may arise due to the delayed payment date and the potential inability of counterparties to complete the transaction. Income is generated as consideration for entering into these transactions and is included in interest income on the Statement of Operations. |
(h) | Short Sales |
The Fund is authorized to engage in short-selling of portfolio securities which obligates the Fund to replace any security that the Fund has borrowed by purchasing the security at current market value sometime in the future. The Fund will incur a loss if the price of the security increases between the date of the short sale and the date on which the Fund replaces the borrowed security. The Fund generally will realize a gain if the price of the security declines between these dates. Until the Fund replaces the borrowed security, the Fund will maintain a segregated account with cash, U.S. Government securities and/or securities held long to sufficiently cover the Fund’s short position on a daily basis. Dividends declared on securities sold short are recorded as an expense on the ex-dividend date and paid to the counterparty on the dividend pay date. |
(i) | Security Transactions and Investment Income |
Security transactions are accounted for on the date the security is purchased or sold (“trade date”). Securities gains and losses are calculated on the identified cost basis. Interest income is recognized on the accrual basis and includes, where applicable, the amortization or accretion of premium or discount. Dividend income is recorded on the ex-dividend date. |
(j) | Securities Lending |
To generate additional income, the Fund may lend its portfolio securities, up to 33 1/3% of the Fund, to brokers, dealers and other financial institutions provided that (1) the borrower delivers cash or securities as collateral with respect to each new loan of U.S. securities, equal to at least 102% of the value of the portfolio securities loaned, and with respect to each new loan on non-U.S. securities, collateral of at least 105% of the value of the portfolio securities loaned; and (2) at all times thereafter shall require the borrower to mark-to-market the collateral on a daily basis so that the market value of such collateral does not fall below 100% of the value of securities loaned. The Fund receives payments from borrowers equivalent to the dividends and interest that would have been earned on securities loaned while simultaneously seeking to earn income on the investment of cash collateral. There may be risks of delay in recovery of the securities should the borrower of the securities fail financially. Loans will be made, however, only to borrowers deemed by the Fund’s investment adviser to be of good standing and creditworthy under guidelines established by the Board of Trustees and when, in judgment of the adviser, the consideration which can be earned currently from these securities loans justifies the attendant risks. Loans are subject to termination by the Fund or the borrower at any time, and, therefore, are not considered to be illiquid investments. JPMorgan Chase Bank serves as custodian for the securities lending program of the Fund. JPMorgan Chase Bank receives a fee based on the value of the collateral received from borrowers. As of June 30, 2007, the Fund had no securities on loan. |
(k) | Distributions to Shareholders |
The Fund’s dividends from net investment income, if any, are declared and paid quarterly. The Fund’s distributions from net realized capital gains, if any, are declared and distributed at least annually. | |
Dividends and distributions to shareholders are determined in accordance with federal income tax regulations, which may differ from GAAP. These “book/tax” differences are considered either permanent or temporary in nature. In accordance with the American Institute of Certified Public Accountants Statement of Position 93-2, permanent differences (i.e., reclassification of market discounts, foreign exchange gain/loss, paydowns, and distributions from real estate investment trusts) are reclassified within the capital accounts based on their nature for federal income tax purposes; temporary differences do not require reclassification. These reclassifications have no effect upon the net asset value of the Fund. To the extent distributions exceed current and accumulated earnings and profits for federal income tax purposes, these distributions are reported as distributions of paid-in-capital. |
(l) | Federal Income Taxes |
It is the policy of the Fund to qualify or to continue to qualify as a “regulated investment company” by complying with the provisions available to certain investment companies, as defined in Subchapter M of the U.S. Internal Revenue Code, and to make distributions of net investment income and net realized capital gains sufficient to relieve the Fund from all, or substantially all, federal income taxes. | |
As of June 30, 2007, the tax cost of securities and the breakdown of unrealized appreciation (depreciation) for the Fund was as follows: |
Net Unrealized | ||||||||||||||||
Tax Cost of | Unrealized | Unrealized | Appreciation | |||||||||||||
Securities | Appreciation | Depreciation | (Depreciation) | |||||||||||||
$ | 739,035,254 | $ | 190,793,549 | $ | (28,386,857 | ) | $ | 162,406,692 | ||||||||
(m) | Allocation of Expenses, Income, and Gains and Losses |
Expenses directly attributable to the Fund are charged to the Fund. Expenses not directly attributable to the Fund are allocated proportionately among various or all funds within the Trust. The method used by the Fund for allocating income, fund level expenses, and realized and unrealized gains or losses is based on the fair value of shares outstanding relative to net assets. Under this method, each class of shares participates based on the total net asset value of that class’s shares in proportion to the total net assets of the Fund. Expenses specific to a class (such as Rule 12b-1 and administrative services fees) are charged to that class. |
3. Transactions with Affiliates
Under the terms of the Trust’s Investment Advisory Agreement, Nationwide Fund Advisors (formerly, Gartmore Mutual Fund Capital Trust (“GMF”)) (“NFA” or the “Advisor”) manages the investment of the assets and supervises the daily business affairs of the Fund. NFA is a wholly-owned subsidiary of Nationwide Financial Services (“NFS”). In addition, NFA provides investment management evaluation services in initially selecting and monitoring, on an ongoing basis, the performance of the subadvisers, for the Fund. The subadvisers listed below manage all or a portion of the Fund’s investments and have the responsibility for making all investment decisions for that portion of the Fund unless otherwise indicated. Below is a list of the subadvisers to the Fund:
Subadvisers** | ||||||
– Franklin Portfolio Associates, LLC | ||||||
– Neuberger Berman Management, Inc. | ||||||
– Gartmore Global Partners*** | ||||||
– American Century Investment Management, Inc. | ||||||
– Morgan Stanley Investment Management, Inc. | ||||||
– Waddell & Reed Investment Management Company | ||||||
** | NFA, as investment adviser, directly manages a portion of the Fund. |
*** | Beginning September 29, 2006, Gartmore Global Partners is no longer an affiliate of NFA. |
Under the terms of the Investment Advisory Agreement, the Fund pays NFA an investment advisory fee of 0.93% based on that Fund’s average daily net assets. From such fees, pursuant to the subadvisory agreements, NFA paid the subadvisers $2,665,038 for the six months ended June 30, 2007.
Under the terms of a Fund Administration and Transfer Agency Agreement, Nationwide Fund Management, LLC ((formerly, Gartmore Investor Services, Inc. (“GISI”))(“NFM”), a wholly-owned subsidiary of NFS Distributors, Inc. (“NFSDI”), provides the Fund with various administrative and accounting services for the Fund (prior to May 1, 2007, this service was provided by Gartmore SA Capital Trust (“GSA”)), and serves as Transfer and Dividend Disbursing Agent
Combined Fee Schedule* | ||||||
Up to $1 billion | 0.15% | |||||
$1 billion up to $3 billion | 0.10% | |||||
$3 billion up to $8 billion | 0.05% | |||||
$8 billion up to $10 billion | 0.04% | |||||
$10 billion up to $12 billion | 0.02% | |||||
$12 billion or more | 0.01% | |||||
* | The assets of the Nationwide NVIT Investor Destinations Aggressive Fund, the Nationwide NVIT Investor Destinations Moderately Aggressive Fund, the Nationwide NVIT Investor Destinations Moderate Fund, the Nationwide NVIT Investor Destinations Moderately Conservative Fund, and the Nationwide NVIT Investor Destinations Conservative Fund (collectively, the “Investor Destinations Funds”) are excluded from the Trust asset level amount in order to calculate this asset-based fee. The Investor Destinations Funds do not pay any part of this fee. |
NFA and NFM have entered into agreements with Citi Fund Services Ohio, Inc. (“Citi”), pursuant to which Citi provides sub-administration and sub-transfer agency services, respectively, to the Fund. Effective August 1, 2007, The BISYS Group Inc. was acquired by and became a wholly owned subsidiary of Citi.
Under the terms of a Distribution Plan under Rule 12b-1 of the 1940 Act, Nationwide Fund Distributors, LLC. (formerly, “Gartmore Distribution Services, Inc.”) (“NFD” or “Distributor”), the Fund’s principal underwriter, is compensated by the Fund for expenses associated with the distribution of the Class II shares of the Fund. NFD is a majority-owned subsidiary of NFSDI. These fees are based on average daily net assets of Class II shares of the Fund at an annual rate not to exceed 0.25%.
Under the terms of an Administrative Services Plan, the Fund may pay fees to servicing organizations, such as broker-dealers, including NFS, and financial institutions, which agree to provide administrative support services to the shareholders of certain classes. These services include, but are not limited, to the following: establishing and maintaining shareholder accounts; processing purchase and redemption transactions; arranging bank wires; performing shareholder sub-accounting; answering inquires regarding the Fund; and other such services. These fees are based on an annual rate of up to 0.25% of the average daily net assets of Class I, Class II, and Class III shares of the Fund and 0.20% of Class IV shares of the Fund.
For the six months ended June 30, 2007, NFS received $666,127 in Administrative Services Fees from the Fund.
Under the terms of a letter agreement dated September 12, 2006, by and among NFA, the Audit Committee of the Trust and the Trust, the Trust has agreed to reimburse NFA certain costs related to the Fund’s portion of ongoing administration, monitoring and annual (audit) testing of the Trust’s Rule 38a-1 Compliance Program subject to the pre-approval of the Trust’s Audit Committee. For the six months ended June 30, 2007, the Fund’s portion of such costs amounted to $6,162.
4. Short-Term Trading Fees
The Fund reserves the right to assess a short-term trading fee on certain transactions out of Class III shares that a separate account makes on behalf of a variable insurance contract owner (the “contract owner”). A separate account that redeems Class III shares on behalf of a contract owner may be subject to a 1.00% short-term trading fee if the separate account held the Class III shares on behalf of the contract owner for 60 days or less, unless an exception applies as disclosed in the Fund’s prospectus. The short-term trading fee is paid directly to the Fund and is intended to offset the cost to the Fund of excess brokerage commissions and other costs associated with fluctuations in Fund asset levels and cash flow caused by
For the six months ended June 30, 2007, the Fund had no contributions to capital due to collection of redemption fees.
5. Investment Transactions
For the six months ended June 30, 2007, (excluding short-term securities) the Fund had purchases of $476,288,370 and sales of $550,331,157.
6. Bank Loans and Earnings Credit
The Trust has a credit agreement with JPMorgan Chase & Co., the Fund’s custodian bank, permitting the Trust to borrow up to $100,000,000. Borrowings under this arrangement bear interest at the Federal Funds rate plus 0.50%. The interest costs, if any, would be included in other fees in the Statement of Operations. No compensating balances were required under the terms of the line of credit. The line of credit is renewed annually, expiring on June 25, 2008, with a commitment fee of 0.07% per year on $100,000,000. There were no borrowings outstanding under this line of credit for the six months ended June 30, 2007.
The Trust’s custodian bank has agreed to reduce the bank’s fees (earnings credit) when the funds of the Trust maintain cash on deposit in non-interest-bearing custody and Demand Deposit Accounts. Earnings credits, if any, are shown as a reduction of total expenses on the Statement of Operations.
7. Portfolio Investment Risks
Risks Associated with Foreign Securities and Currencies. Investments in securities of foreign issuers carry certain risks not ordinarily associated with investments in securities of U.S. issuers. These risks include future political and economic developments, and the possible imposition of exchange controls or other foreign governmental laws and restrictions. In addition, with respect to certain countries, there is the possibility of expropriation of assets, confiscatory taxation, political or social instability, or diplomatic developments, which could adversely affect investments in those countries.
Certain countries also may impose substantial restrictions on investments in their capital markets by foreign entities, including restrictions on investments in issuers of industries deemed sensitive to relevant national interests. These factors may limit the investment opportunities available and result in a lack of liquidity and high price volatility with respect to securities of issuers from developing countries.
8. Indemnifications
Under the Trust’s organizational documents, certain of the Trust’s Officers and Trustees are indemnified against certain liabilities arising out of the performance of their duties to the Trust. In addition, the Trust has entered into Indemnification Agreements with the Trust’s trustees and certain officers covering similar liabilities. Trust Officers receive no compensation from the Trust for serving as the Trust’s Officers. In addition, in the normal course of business, the Trust enters into contracts with its vendors and others that provide for general indemnifications. The Trust’s maximum exposure under these arrangements is unknown, as this would involve future claims that may be made against the Trust. Based on experience, however, the Trust expects that risk of loss to be remote.
9. Recently Issued Accounting Pronouncements
On July 13, 2006, the Financial Accounting Standards Board (“FASB”) released FASB Interpretation No. 48, Accounting for Uncertainty in Income Taxes (“FIN 48”). FIN 48 provides guidance for how uncertain tax positions should be recognized, measured, presented and disclosed in the financial statements. FIN 48 requires the affirmative evaluation of tax positions taken or expected to be taken in the course of preparing the Fund’s tax returns to determine whether it is more-likely-than-not (i.e., greater than 50 percent) that each tax position will be sustained upon examination by a taxing authority based on the technical merits of the position. A tax position that meets the more-likely-than-not recognition
In September 2006, the FASB issued Statement on Financial Accounting Standards (“SFAS”) No. 157, “Fair Value Measurements.” This standard establishes a single authoritative definition of fair value, sets out a framework for measuring fair value and requires additional disclosures about fair value measurements. SFAS No. 157 applies to fair value measurements already required or permitted by existing standards. SFAS No. 157 is effective for financial statements issued for fiscal years beginning after November 15, 2007 and interim periods within those fiscal years. The changes to current accounting principles generally accepted in the United States of America from the application of this Statement relate to the definition of fair value, the methods used to measure fair value, and the expanded disclosures about fair value measurements. As of June 30, 2007, the Fund does not believe the adoption of SFAS No. 157 will impact the financial statement amounts; however, additional disclosures may be required about the inputs used to develop the measurements and the effect of certain of the measurements on changes in net assets for the period.
Trustees who are not Interested Persons (as defined in the 1940 Act) and Officers of the Trust as of
Number of Portfolios | ||||||||||
Position(s) Held | in the | |||||||||
with the Trust | Principal Occupation(s) | Nationwide Fund | Other | |||||||
Name, Address | and Length of | During Past | Complex Overseen | Directorships | ||||||
and Year of Birth | Time Served1 | Five Years | by Trustee | Held by Trustee2 | ||||||
Charles E. Allen c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1948 | Trustee since July 2000 | Mr. Allen is Chairman, Chief Executive Officer and President of Graimark Realty Advisors, Inc. (real estate development, investment and asset management). | 89 | None | ||||||
Paula H.J. Cholmondeley c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1947 | Trustee since July 2000 | Ms. Cholmondeley was Vice President and General Manager of Sappi Fine Paper North America from April 2000 through December 2003. | 89 | Director of Dentsply International, Inc. (dental products), Ultralife Batteries, Inc., Terex Corporation (construction equipment), Minerals Technology, Inc. (specialty chemicals) and Albany International Corp. (paper industry) | ||||||
C. Brent DeVore3 c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1940 | Trustee since 1990 | Dr. DeVore is President of Otterbein College. | 89 | None | ||||||
Phyllis Kay Dryden c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1947 | Trustee since December 2004 | Ms. Dryden was a partner of Mitchell Madison, a management consulting company from January 2006 until December 2006; she is currently a consultant with the company. Ms. Dryden was formerly Managing Partner of march FIRST, a global management consulting firm. | 89 | None | ||||||
Barbara L. Hennigar c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1935 | Trustee since July 2000 | Retired. | 89 | None | ||||||
Number of Portfolios | ||||||||||
Position(s) Held | in the | |||||||||
with the Trust | Principal Occupation(s) | Nationwide Fund | Other | |||||||
Name, Address | and Length of | During Past | Complex Overseen | Directorships | ||||||
and Year of Birth | Time Served1 | Five Years | by Trustee | Held by Trustee2 | ||||||
Barbara I. Jacobs c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1950 | Trustee since December 2004 | Ms. Jacobs served as Chairman of the Board of Directors of KICAP Network Fund, a European (United Kingdom) hedge fund, from January 2001 through January 2006. From 1998-2003, Ms. Jacobs was also a Managing Director and European Portfolio Manager of CREF Investments (Teachers Insurance and Annuity Association-College Retirement Equities Fund). | 89 | None | ||||||
Douglas F. Kridler c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1955 | Trustee since September 1997 | Mr. Kridler has served as the President and Chief Executive Officer of the Columbus Foundation (a Columbus, OH-based foundation which manages over 1,300 individual endowment funds) since February 2002. Prior to January 31, 2002, Mr. Kridler was the President of the Columbus Association for the Performing Arts and Chairman of the Greater Columbus Convention and Visitors Bureau. | 89 | None | ||||||
Michael D. McCarthy c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1947 | Trustee since December 2004 | Retired. Mr. McCarthy was Chairman of VMAC (commodity swaps) from October 2002 until January 2007; and a partner of Pineville Properties LLC (a commercial real estate development firm) from September 2000 until January 2007. | 89 | None | ||||||
David C. Wetmore c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1948 | Trustee since 1995 and Chairman since February 2005 | Retired. | 89 | None | ||||||
1 | Length of time served includes time served with the Trust’s predecessors. | |
2 | Directorships held in (1) any other investment companies registered under the 1940 Act, (2) any company with a class of securities registered pursuant to Section 12 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or (3) any company subject to the requirements of Section 15(d) of the Exchange Act. | |
3 | Mr. DeVore has served as President of Otterbein College since 1984. Mark Thresher, President and Chief Operating Officer of Nationwide Financial Services, Inc. (“NFS”) has served as a member of the Board of Trustees of Otterbein College since 2000, currently serves as one of 30 of its trustees, and is currently one of two Vice Chairmen of the Board. Each of Nationwide Fund Advisors (“NFA”), the Funds’ investment adviser, and Nationwide Fund Distributors LLC (“NFD”), principal underwriter to the Trust, is a wholly-owned subsidiary of NFS. | |
Additional information regarding the Trustees and Officers may be found in the Trust’s Statement of Additional Information, which is available without charge upon request, by calling 800-848-0920. |
Trustees who are Interested Persons (as defined in the 1940 Act) and/or Officers of the Trust as of
Number of Portfolios | ||||||||||
Position(s) Held | in the | |||||||||
with the Trust | Principal Occupation(s) | Nationwide Fund | Other | |||||||
Name, Address | and Length of | During Past | Complex Overseen | Directorships | ||||||
and Year of Birth | Time Served1 | 5 Years | by Trustee | Held by Trustee 2 | ||||||
Arden L. Shisler c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1941 | Trustee since February 2000 | Retired. Mr. Shisler is the former President and Chief Executive Officer of KeB Transport, Inc., a trucking firm (2000 through 2002). He served as a consultant to KeB from January 2003 through December 2004. Since 1992, Mr. Shisler has also been Chairman of the Board for Nationwide Mutual Insurance Company.3 | 89 | Director of Nationwide Financial Services, Inc., Chairman of Nationwide Mutual Insurance Company3 | ||||||
John H. Grady Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1961 | President & Chief Executive Officer since December 2006 | Mr. Grady is President, and Chief Executive Officer of Nationwide Funds Group which includes Nationwide Fund Advisors,3 Nationwide Fund Management LLC,3 Nationwide Fund Distributors LLC 3 and NWD Investments,2 the asset management operations of Nationwide Mutual Insurance Company, which includes Morley Capital Management, Inc.,2 Nationwide Separate Accounts LLC,2 NorthPointe Capital LLC,2 and Nationwide SA Capital Trust2. From March 2004 until March 2006, Mr. Grady was Chief Executive Officer of Constellation Investment Management Co., L.P. (registered investment adviser), and President and Chief Executive Officer of Constellation Funds Group (registered investment companies). He also was President of Constellation Investment Distribution Co., Inc. (registered broker-dealer) from March 2004 until June 2006. From February 2001 until February 2004, Mr. Grady was Chief Operating and Chief Legal Officer; Managing Director, Mutual Funds Group, Turner Investment Partners, Inc. (registered investment adviser); Executive Vice President of Turner Funds and Turner Institutional Portfolios (registered investment companies); and President, Turner Investment Distributors, Inc. (registered broker-dealer). | N/A | None | ||||||
Gerald J. Holland Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1951 | Treasurer since March 2001 | Mr. Holland is Senior Vice President—Operations for Nationwide Funds Group3. | N/A | N/A | ||||||
Number of Portfolios | ||||||||||
Position(s) Held | in the | |||||||||
with the Trust | Principal Occupation(s) | Nationwide Fund | Other | |||||||
Name, Address | and Length of | During Past | Complex Overseen | Directorships | ||||||
and Year of Birth | Time Served1 | 5 Years | by Trustee | Held by Trustee 2 | ||||||
Michael A. Krulikowski Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1959 | Chief Compliance Officer from June 2004 to August 20074 | Mr. Krulikowski is Vice President and Chief Compliance Officer of Nationwide Funds Group3, Morley Capital Management, Inc.3, Nationwide SA Capital Trust (since 1999)3, and Nationwide Separate Accounts LLC (since August 2005).3 Since June 2004, Mr. Krulikowski has also served as Chief Compliance Officer of the Trust. From November 1999 through May 2007, he served as Vice President and Chief Compliance Officer of NorthPointe Capital LLC. 3 | N/A | N/A | ||||||
Eric E. Miller Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1953 | Secretary since December 2002 | Mr. Miller is Senior Vice President, General Counsel, and Assistant Secretary for Nationwide Funds Group3 and NWD Investments.2 From August 2000 to August 2002, Mr. Miller was a Partner with Stradley Ronon Stevens & Young, LLP. | N/A | N/A | ||||||
1 | Length of time served includes time served with the Trust’s predecessors. | |
2 | Directorships held in (1) any other investment companies registered under the 1940 Act, (2) any company with a class of securities registered pursuant to Section 12 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or (3) any company subject to the requirements of Section 15(d) of the Exchange Act. | |
3 | This position is held with an affiliated person or principal underwriter of the Trust. | |
4 | Effective August 3, 2007, the Board of Trustees approved Carol Baldwin Moody as Chief Compliance Officer of the Trust. Since November 2005, Ms. Moody has been Senior Vice President, Chief Compliance Officer of Nationwide Financial Services, Nationwide Life Insurance Company, Nationwide Life and Annuity Insurance Company, and Nationwide Investment Advisors, LLC. From February 2004-November 2005, she was Chief Compliance Officer of TIAA-CREF and from April 2000-February 2004, she was Managing Director and General Counsel, TCW/ Latin America Partners, LLC and Baeza & Co., LLC. | |
Federal law requires the Trust, each of its investment advisers and sub-advisers to adopt procedures for voting proxies (“Proxy Voting Guidelines”) and to provide a summary of those Proxy Voting Guidelines used to vote the securities held by the Funds. The Funds’ proxy voting policies and procedures are available without charge (i) upon request, by calling 800-848-0920, (ii) on the Funds’ website at www.nationwidefunds.com, or (iii) on the Securities and Exchange Commission’s website at www.sec.gov. |
A. Renewal of Investment Advisory Agreement
(i) General Information Regarding the Board’s Review of Investment Advisory Agreements
The Trust’s investment advisory agreements (each an “Advisory Agreement”) with its investment adviser and, as applicable, sub-advisers (together, the “Adviser”) must be approved for an initial term no greater than two years, and renewed at least annually thereafter, (i) by the vote of the Trustees or by a vote of the shareholders of each series or fund of the Trust (individually a “Fund” ), and (ii) by the vote of a majority of the Trustees who are not parties to the Advisory Agreement or “interested persons” of any party thereto (the “Independent Trustees”) cast in person at a meeting called for the purpose of voting on such approval.
The Board meets quarterly and takes into account throughout the year matters bearing on each Fund’s Advisory Agreement. The Board and its standing committees consider at each meeting factors that are relevant to the annual renewal of an Advisory Agreement, including the services and support provided to a Fund and its shareholders.
On December 6, 2006, the Independent Trustees first met in person with their independent legal counsel (“Independent Legal Counsel”) to consider information provided by the Adviser and others to assist the Trustees in considering whether to renew each Fund’s Advisory Agreement for a one year term beginning May 1, 2007. Immediately following such meeting of the Independent Trustees, all Trustees met in person with the Adviser, Trust counsel, Independent Legal Counsel and others to consider such matters, and give preliminary consideration to information bearing on continuation of each Advisory Agreement. The primary purpose of the December 6 and 7, 2006 meeting was to ensure that the Trustees had ample opportunity to consider matters they deemed relevant in considering the continuation of an Advisory Agreement, and to request any additional information they considered reasonably necessary to their deliberations.
In preparation for the December 6 and 7, 2006 meeting the Trustees were provided, at the request of the Trustees, with a wide range of information to assist in their deliberations, including (i) reports from Lipper Inc. describing a Fund’s (a) performance rankings (where “first quintile” denotes the best performance) (over multiple years ended September 30, 2006) compared with performance groups and performance universes created by Lipper (and in some cases, customized peer groups created by the Adviser) of similar or peer group funds, and (b) expense rankings (where “first quintile” denotes the lowest fees and expenses) comparing the Fund’s contractual advisory fee and total expenses with expense groups and expense universes created by Lipper of similar or peer group funds, (ii) information from the Adviser describing the Fund’s performance (over multiple years ended September 30, 2006) compared with its benchmark and Lipper categories, (iii) for Funds under “close review,” copies of letters from the Adviser to the portfolio manager of each such Fund, together with the portfolio manager’s written response describing the reasons for the Fund’s underperformance (iv) information from the Adviser describing performance for the months of October and November, 2006, and annual performance for the year ended November 30, 2006, (v) reports from the Adviser describing the Adviser’s profitability in providing services under an Advisory Agreement, together with an explanation of Adviser’s methodology in calculating its profitability, (vi) information from the Adviser describing any fees paid to the Adviser for managing similar, non-affiliated institutional accounts, including the range of fee levels for such accounts, and (vii) information from the Adviser describing ancillary benefits, in addition to fees for serving as investment adviser, derived by the Adviser as a result of being investment adviser for a Fund, including, where applicable, information on soft-dollar benefits and fees inuring to the Adviser’s affiliates for serving as the Trust’s administrator, fund accountant and transfer agent.
At the December 6 and 7, 2006 meeting, the Trustees reviewed, considered and discussed, among themselves and with the Adviser, Trust counsel and Independent Legal Counsel, among other things, the information described above, and: (i) the nature, extent and quality of services provided by the Adviser under each Advisory Agreement, (ii) the investment performance of each Fund and the Adviser, (iii) the costs of the services provided by the Adviser under the Advisory Agreement and the profits realized by the Adviser thereunder, (iv) the extent to which economies of scale may be present and, if so, whether they are being shared with a Fund’s shareholders, (v) comparisons of the Adviser’s fees under the Advisory Agreement with investment advisory fees paid by peer group funds to their investment advisers and paid by non-affiliated institutional clients to the Adviser for managing similar accounts, and (vi) any ancillary benefits inuring to the Adviser and its affiliates as a result of being investment adviser for the Trust. The Trustees also considered, where
As part of the December 6 and 7, 2006 Board meeting, the Independent Trustees developed a list of follow-up matters and questions and asked that Adviser respond to such matters and questions at the contract approval meeting of the Board of Trustees to be held on January 11, 2007.
At the January 11, 2007 meeting of the Board of Trustees of the Trust, the Board received and considered information provided by the Adviser in follow-up from the December 6 and 7, 2006 Board meeting and, after consulting among themselves, and with the Adviser, Trust counsel and Independent Legal Counsel, concluded unanimously to renew the Advisory Agreement for the reasons set forth in the following section. In determining whether to renew the Advisory Agreement for the Fund, the Board ultimately reached a determination, with the assistance of Trust counsel and Independent Legal Counsel, that the renewal of the Advisory Agreement and the compensation to be received by the Adviser under the Advisory Agreement is consistent with the Board’s fiduciary duty under applicable law.
(ii) Board Conclusions Regarding the Fund’s Advisory Agreement
The Board considered that the Fund had underperformed its benchmark, the Russell 2000 Index, for the one- and five-year periods, and outperformed the Fund’s benchmark for the three-year period. The Board also considered that the performance of the Fund’s Class I shares had ranked in the fourth quintile of the Fund’s Lipper-constructed Performance Group over the one-year period, and in the second quintile of two- and four-year periods, and the first quintile over the three- and five-year periods. Although the Fund underperformed for the one-year period, the Board considered that: (i) longer-term performance had been strong; and (ii) management had committed to closely review and monitor the performance of the Fund and each subadviser to determine whether any changes should be proposed to the Board. Based on its review, the Board concluded that the nature, extent and quality of the services provided to the Fund will benefit the Fund’s shareholders.
The Board also considered that the Fund’s contractual advisory fee and breakpoints placed the Fund in the fourth quintile of its Lipper-constructed Expense Group and the Fund’s total expenses placed the Fund in the third quintile. The Board found that although the Fund’s contractual advisory fee compared with its peer group was relatively high, the fees were within the range of those charged by its peer group. Based on its review, the Board concluded that the Fund’s management fee and total expenses were fair and reasonable in light of the services that the Fund receives and the other factors considered.
The Board considered that the Fund’s adviser reported a pre-tax profit margin for investment management services during each of the twelve month-periods ended September 30, 2006 and 2005. The Board considered the costs of the services provided by and the profits realized by the Fund’s adviser in connection with the operation of the Fund and determined that the amount of profit is a fair entrepreneurial profit for the management of the Fund.
Based upon its evaluation of all of the conclusions noted above, and after considering all material factors with respect to the Fund, the Board ultimately concluded that the advisory fee structure is fair and reasonable, and that the Advisory Agreement (and, if applicable, Sub-Advisory Agreement) with respect to the Fund, should be renewed.
B. Approval of New Advisory Agreement
At its January 11, 2007 meeting, the Board also unanimously approved a new investment advisory agreement (the “New Agreement”) for the Fund with Nationwide Fund Advisors, (“NFA”) the then-current adviser to each of the series of the Trust to become effective upon the closing of the acquisition of NFA by Nationwide Financial Services, Inc. (“NFS”) from Nationwide Corporation (“NWC”) which closed on April 30, 2007 (the “Transaction”). In approving the New Agreement, the Board considered NFA’s capacity to continue to provide the services needed to operate a sophisticated investment management business and to support the management of each of the series. The Board also took into account
C. Submission of Matters to a Vote of Security Holders:
On April 25, 2007, a Special Meeting of Shareholders was held* (the “April 25 Meeting”) at which shareholders of the Funds** set forth below were asked:
Proposal 1:
To approve a new investment advisory agreement, on behalf of their Fund, between Nationwide Fund Advisors (formerly “Gartmore Mutual Fund Capital Trust”) (the “Adviser”) and Nationwide Variable Insurance Trust (formerly “Gartmore Variable Insurance Trust”) (the “Trust”).
Number of Shares | ||||||
Fund | Cast/Not Cast | Percentages | ||||
Federated NVIT High Income Bond Fund (Formerly Federated GVIT High Income Bond Fund) | FOR AGAINST ABSTAIN TOTAL | 30,051,703.188 shares 618,245.021 shares 1,813,550.431 shares 32,483,498.640 shares | 92.514% 1.903% 5.583% | |||
NVIT International Index Fund (Formerly GVIT International Index Fund) | FOR AGAINST ABSTAIN TOTAL | 4,322,203.982 shares 2,758.318 shares 135,636.840 shares 4,460,599.140 shares | 96.897% 0.062% 3.041% | |||
NVIT International Value Fund (Formerly GVIT International Value Fund) | FOR AGAINST ABSTAIN TOTAL | 20,032,843.199 shares 333,588.902 shares 1,093,293.879 shares 21,459,725.980 shares | 93.351% 1.554% 5.095% | |||
NVIT Mid Cap Index Fund (Formerly GVIT Mid Cap Index Fund) | FOR AGAINST ABSTAIN TOTAL | 35,380,179.120 shares 631,117.844 shares 1,565,714.306 shares 37,577,011.270 shares | 94.154% 1.679% 4.167% |
Number of Shares | ||||||
Fund | Cast/Not Cast | Percentages | ||||
NVIT S&P 500 Index Fund (Formerly GVIT S&P 500 Index Fund) | FOR AGAINST ABSTAIN TOTAL | 56,119,814.230 shares 666,195.542 shares 1,944,898.888 shares 58,730,908.660 shares | 95.554% 1.134% 3.312% | |||
Nationwide Multi-Manager NVIT Small Cap Growth Fund (Formerly GVIT Small Cap Growth Fund) | FOR AGAINST ABSTAIN TOTAL | 7,632,918.513 shares 149,458.111 shares 451,583.036 shares 8,233,959.660 shares | 92.700% 1.816% 5.484% | |||
Nationwide Multi-Manager NVIT Small Cap Value Fund (Formerly GVIT Small Cap Value Fund) | FOR AGAINST ABSTAIN TOTAL | 48,649,396.525 shares 979,183.753 shares 2,786,133.102 shares 52,414,713.380 shares | 92.816% 1.868% 5.316% | |||
Nationwide Multi-Manager NVIT Small Company Fund (Formerly GVIT Small Company Fund) | FOR AGAINST ABSTAIN TOTAL | 29,903,181.700 shares 838,774.923 shares 2,006,741.307 shares 32,748,697.930 shares | 91.311% 2.561% 6.128% | |||
Gartmore NVIT Developing Markets Fund (Formerly Gartmore GVIT Developing Markets Fund) | FOR AGAINST ABSTAIN TOTAL | 21,0177,889.443 shares 424,272.958 shares 1,543,850.729 shares 23,046,013.130 shares | 91.460% 1.841% 6.699% | |||
Gartmore NVIT Emerging Markets Fund (Formerly Gartmore GVIT Emerging Markets Fund) | FOR AGAINST ABSTAIN TOTAL | 17,050,534.593 shares 526,574.722 shares 881,608.905 shares 18,458,718.220 shares | 92.371% 2.853% 4.776% | |||
Nationwide NVIT Global Financial Services Fund (Formerly Gartmore GVIT Global Financial Services Fund) | FOR AGAINST ABSTAIN TOTAL | 1,554,847.333 shares 19,539.033 shares 52,206.494 shares 1,626,592.860 shares | 95.589% 1.201% 3.210% | |||
Nationwide NVIT Global Health Sciences Fund (Formerly Gartmore GVIT Global Health Sciences Fund) | FOR AGAINST ABSTAIN TOTAL | 4,722,963.678 shares 157,979.030 shares 207,642.222 shares 5,088,584.930 shares | 92.815% 3.104% 4.081% | |||
Nationwide NVIT Global Technology and Communications Fund (Formerly Gartmore GVIT Global Technology and Communications Fund) | FOR AGAINST ABSTAIN TOTAL | 8,585,472.039 shares 102,267.977 shares 489,577.634 shares 9,177,317.650 shares | 93.551% 1.114% 5.335% | |||
Gartmore NVIT Global Utilities Fund (Formerly Gartmore GVIT Global Utilities Fund) | FOR AGAINST ABSTAIN TOTAL | 4,123,270.549 shares 122,001.533 shares 240,276.088 shares 4,485,548.170 shares | 91.923% 2.720% 5.357% | |||
Nationwide NVIT Government Bond Fund (Formerly Gartmore GVIT Government Bond Fund) | FOR AGAINST ABSTAIN TOTAL | 88,471,567.462 shares 1,825,645.181 shares 5,841,990.727 shares 96,139,203.370 shares | 92.024% 1.899% 6.077% |
Number of Shares | ||||||
Fund | Cast/Not Cast | Percentages | ||||
Nationwide NVIT Growth Fund (Formerly Gartmore GVIT Growth Fund) | FOR AGAINST ABSTAIN TOTAL | 14,931,435.904 shares 409,826.402 shares 1,259,945.064 shares 16,601,207.370 shares | 89.942% 2.469% 7.589% | |||
Gartmore NVIT International Growth Fund (Formerly Gartmore GVIT International Growth Fund) | FOR AGAINST ABSTAIN TOTAL | 6,251,419.070 shares 139,618.548 shares 290,025.592 shares 6,681,063.210 shares | 93.569% 2.090% 4.341% | |||
Nationwide NVIT Investor Destinations Aggressive Fund (Formerly Gartmore GVIT Investor Destinations Aggressive Fund) | FOR AGAINST ABSTAIN TOTAL | 49,489,224.549 shares 1,385,396.474 shares 3,696,272.337 shares 54,570,893.360 shares | 90.688% 2.539% 6.773% | |||
Nationwide NVIT Investor Destinations Conservative Fund (Formerly Gartmore GVIT Investor Destinations Conservative Fund) | FOR AGAINST ABSTAIN TOTAL | 23,091,965.887 shares 314,935,884 shares 2,292,355.179 shares 25,699,256.950 shares | 89.855% 1.225% 8.920% | |||
Nationwide NVIT Investor Destinations Moderate Fund (Formerly Gartmore GVIT Investor Destinations Moderate Fund) | FOR AGAINST ABSTAIN TOTAL | 188,902,093.059 shares 3,018,924.590 shares 16,359,690.401 shares 208,280,708.050 shares | 90.696% 1.449% 7.855% | |||
Nationwide NVIT Investor Destinations Moderately Aggressive Fund (Formerly Gartmore GVIT Investor Destinations Moderately Aggressive Fund) | FOR AGAINST ABSTAIN TOTAL | 134,792,622.920 shares 3,489,207.264 shares 9,304,197.656 shares 147,586,027.840 shares | 91.332% 2.364% 6.304% | |||
Nationwide NVIT Investor Destinations Moderately Conservative Fund (Formerly Gartmore GVIT Investor Destinations Moderately Conservative Fund) | FOR AGAINST ABSTAIN TOTAL | 49,627,123.216 shares 856,088.634 shares 3,507,215.650 shares 53,990,427.500 shares | 91.918% 1.586% 6.496% | |||
Nationwide NVIT Mid Cap Growth Fund (Formerly Gartmore GVIT Mid Cap Growth Fund) | FOR AGAINST ABSTAIN TOTAL | 10,879,584.971 shares 352,594.958 shares 717,792.971 shares 11,949,972.900 shares | 91.043% 2.950% 6.007% | |||
Nationwide NVIT Money Market Fund II (Formerly Gartmore GVIT Money Market Fund II) | FOR AGAINST ABSTAIN TOTAL | 221,774,863.241 shares 12,322,482.494 shares 16,471,740.875 shares 250,569,086.610 shares | 88.508% 4.918% 6.574% | |||
Nationwide NVIT Money Market Fund (Formerly Gartmore GVIT Money Market Fund) | FOR AGAINST ABSTAIN TOTAL | 1,578,331,008.328 shares 32,372,133.671 shares 112,652,123.301 shares 1,723,355,265.300 shares | 91.585% 1.878% 6.537% | |||
NVIT Nationwide Fund (Formerly Gartmore GVIT NationwideFund) | FOR AGAINST ABSTAIN TOTAL | 125,423,274.735 shares 2,767,979.467 shares 8,762,255.828 shares 136,953,510.030 shares | 91.581% 2.021% 6.398% |
Number of Shares | ||||||
Fund | Cast/Not Cast | Percentages | ||||
NVIT Nationwide Leaders Fund (Formerly Gartmore GVIT Nationwide Leaders Fund) | FOR AGAINST ABSTAIN TOTAL | 2,298,504.956 shares 29,630.469 shares 71,637.755 shares 2,399,773.180 shares | 95.780% 1.235% 2.985% | |||
Nationwide NVIT U.S. Growth Leaders Fund (Formerly Gartmore GVIT U.S. Growth Leaders Fund) | FOR AGAINST ABSTAIN TOTAL | 4,972,094.773 shares 122,623.161 shares 174,625.606 shares 5,269,343.540 shares | 94.359% 2.327% 3.314% | |||
Gartmore NVIT Worldwide Leaders Fund (Formerly Gartmore GVIT Worldwide Leaders Fund) | FOR AGAINST ABSTAIN TOTAL | 2,666,862.487 shares 47,702.491 shares 118,719.882 shares 2,833,284.860 shares | 94.126% 1.684% 4.190% | |||
J.P. Morgan NVIT Balanced Fund (Formerly J.P. Morgan GVIT Balanced Fund) | FOR AGAINST ABSTAIN TOTAL | 15,966,867.546 shares 259,004.324 shares 1,339,385.200 shares 17,565,257.070 shares | 90.900% 1.475% 7.625% | |||
Van Kampen NVIT Comstock Value Fund (Formerly Van Kampen GVIT Comstock Value Fund) | FOR AGAINST ABSTAIN TOTAL | 27,737,008.009 shares 502,564.164 shares 1,824,670.107 shares 30,064,242.280 shares | 92.259% 1.672% 6.069% | |||
Van Kampen NVIT Multi Sector Bond Fund (Formerly Van Kampen GVIT Multi Sector Bond Fund) | FOR AGAINST ABSTAIN TOTAL | 21,253,297.665 shares 484,100.920 shares 1,803,963.645 shares 23,541,362.230 shares | 90.281% 2.056% 7.663% | |||
At the April 25 Meeting, shareholders of the Nationwide NVIT Mid Cap Growth Fund were also asked to approve a new investment subadvisory agreement among the Adviser, the Trust and NorthPointe Capital LLC. The voting results with respect to that proposal are set forth below:
Proposal 2
Number of Shares | ||||||
Fund | Cast/Not Cast | Percentages | ||||
Nationwide NVIT Mid Cap Growth Fund (Formerly Gartmore GVIT Mid Cap Growth Fund) | FOR AGAINST ABSTAIN TOTAL | 10,862,827.499 shares 414,574.660 shares 672,570.741 shares 11,949,972.900 shares | 90.903% 3.469% 5.628% | |||
* | This meeting was previously adjourned on April 23, 2007. | |
** | Fund names were changed effective May 1, 2007 to reflect “Nationwide”/ “NVIT” branding to coincide with the sale of Nationwide Fund Advisors, Inc. by Nationwide Corporation to its majority-owned subsidiary, Nationwide Financial Services, Inc. |
June 30, 2007 (Unaudited)
Contents | ||
6 | Statement of Investments | |
15 | Statement of Assets and Liabilities | |
16 | Statement of Operations | |
17 | Statements of Changes in Net Assets | |
18 | Financial Highlights | |
19 | Notes to Financial Statements |
Statement Regarding Availability of Proxy Voting Record.
SAR-FHIB (8/07) | ![]() |
Dear Fellow Shareholder:
Since I last wrote to you, our mutual funds have enjoyed another period of solid performance, and the corporate realignment that was in progress is now finished.
On May 1, 2007, Nationwide Financial Services, Inc. (NFS), completed its acquisition of the Philadelphia-based retail mutual fund operations of NWD Investment Management, Inc. (formerly, “Gartmore Global Investments, Inc.”), from Nationwide Corporation, a subsidiary of Nationwide Mutual Insurance Company. Effective that date, the acquired entities were renamed Nationwide Funds Group (NFG), and the Gartmore Funds were renamed the Nationwide Funds to better align with the Nationwide® brand. Although the corporate ownership and fund names have changed, I can assure you that NFG intends to maintain as much continuity as possible with the Funds and key personnel.
Thank you, shareholders, for approving the new investment advisory agreement that was required due to the change in corporate ownership. The new agreement is identical in all material respects to the original agreement that it replaces, with the exception of the section pertaining to the vote by the shareholders of the NVIT Mid Cap Growth Fund to approve NorthPointe Capital®, LLC (NorthPointe) as sub-adviser to that particular Fund.
Market Overview: January 1-June 30, 2007
Share prices in general were buoyed in part by better-than-expected first-quarter 2007 earnings and a flurry of mergers and acquisitions, many of these spurred by readily available funding from private equity firms. In June, investors grew more cautious amid surging crude oil prices, a sudden spike in long-term interest rates, and the meltdown of two hedge funds that had exposure to the subprime mortgage market. Looking abroad, a weak U.S. dollar aided foreign stocks, as reflected in the 11.09% advance of the Morgan Stanley Capital International Europe, Australasia and Far East (MSCI EAFE®) Index. Emerging market performance was particularly robust.
The bond market struggled during the first half of 2007. While short-term interest rates remained stable, reflecting the Federal Reserve Board’s decision in June to leave the target federal funds rate at 5.25%, longer-term rates climbed during the first half of 2007, depressing bond prices and forcing the Lehman Brothers® U.S. Aggregate Index to settle for a modest 0.97% return.
We at NFG thank you for your understanding and cooperation throughout our recent transition period. We emerge from this period energized for the future, and we look forward to serving your investment needs for a long time to come.
Nationwide Funds Group
PAST PERFORMANCE IS NO GUARANTEE OF FUTURE RESULTS.
Nationwide Funds are advised by Nationwide Fund Advisors (NFA). NFA is a wholly-owned subsidiary of Nationwide Financial Services. Nationwide Financial Services is a wholly-owned subsidiary of Nationwide Corporation. All of the common stock of Nationwide Corporation is held by Nationwide Mutual (95.2%) and Nationwide Mutual Fire Insurance Company (4.8%), each of which is a mutual company owned by its policyholders.
Nationwide Funds Group (NFG) is the mutual fund arm of Nationwide Financial Services (NYSE: NFS). Based in Conshohocken, Pa., a suburb of Philadelphia, NFG is comprised of Nationwide Fund Advisors, Nationwide Fund Distributors, LLC, and Nationwide Fund Management, LLC. Together, these provide advisory, distribution, and administration services respectively to the Nationwide Funds, and manage more than $43.5 billion in assets as of June 30, 2007, of which more than $12 billion are in “fund of funds” designed to provide asset allocation across several types of investments and asset classes.
Lehman Brothers (LB) U.S. Aggregate Index: An unmanaged, market value-weighted index of investment-grade, fixed-rate debt issues (including government, corporate, asset-backed, and mortgage-backed securities with maturities of one year or more) that is generally representative of the bond market as a whole.
Morgan Stanley Capital International Europe, Australasia and Far East (MSCI EAFE®) Index: An unmanaged, free float-adjusted, market capitalization-weighted index that is designed to measure the performance of stocks in developed markets outside the United States and Canada.
Standard & Poor’s 500® (S&P 500) Index: An unmanaged, market capitalization-weighted index of 500 widely held stocks of large-cap U.S. companies that gives a broad look at how the stock prices of those companies have performed.
Views expressed within are those of Nationwide Funds Group as of the date noted, are subject to change at any time, and may not come to pass.
This report is for informational purposes only, and is not intended as an offer or recommendation with respect to the purchase or sale of any security, option, future, or other derivatives in such securities.
Investing in mutual funds involves risk, including possible loss of principal.
Investors should carefully consider a fund’s investment objectives, risks, fees, charges, and expenses before investing any money. To obtain this and other fund information, please call 800-848-0920 to request a prospectus, or download a prospectus at www.nationwidefunds.com. Please read the prospectus carefully before investing any money.
Nationwide Funds distributed by Nationwide Fund Distributors LLC (formerly Gartmore Distribution Services, Inc.), Member NASD. 1200 River Road, Suite 1000, Conshohocken, Pa. 19428.
As a shareholder of the Fund, you incur two types of costs: (1) transaction costs, including sales charges (loads) paid on purchase payments and redemption fees; and (2) ongoing costs, including investment advisory fees, administration fees, distribution fees and other Fund expenses. The examples below are 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. Per SEC requirements, the examples assume that you had a $1,000 investment in the Class at the beginning of the reporting period, January 1, 2007, and continued to hold your shares at the end of the reporting period, June 30, 2007.
Actual Expenses
Hypothetical Example for Comparison Purposes
Please note that the expenses shown in the table are meant to highlight your ongoing costs only and do not reflect any transaction costs, such as sales charges (loads) or redemption fees. Therefore, the second line for each Class in 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 transaction costs were included, your costs would have been higher. The examples also assume all dividends and distributions have been reinvested.
Schedule of Shareholder Expenses
Beginning | Ending | Expenses Paid | Annualized | |||||||||||||||||||
Federated NVIT High Income Bond Fund | Account Value | Account Value | During | Expense Ratio* | ||||||||||||||||||
1/1/07 06/30/07 Period* | ||||||||||||||||||||||
Class I | Actual | $ | 1,000.00 | $ | 1,028.40 | $ | 4.93 | 0.98% | ||||||||||||||
Hypothetical | 1 | $ | 1,000.00 | $ | 1,019.94 | $ | 4.92 | 0.98% | ||||||||||||||
Class III | Actual | $ | 1,000.00 | $ | 1,028.60 | $ | 4.73 | 0.94% | ||||||||||||||
Hypothetical | 1 | $ | 1,000.00 | $ | 1,020.14 | $ | 4.72 | 0.94% | ||||||||||||||
* | Expenses are equal to the Fund’s annualized expense ratio multiplied by the average account value over the period multiplied by 181/365 (to reflect the one-half year period). The expense ratio presented represents a six-month, annualized ratio in accordance with SEC guidelines. The expenses reported above do not include the effect of additional expenses imposed by variable annuity contracts. |
1 Represents the hypothetical 5% return before expenses.
Asset Allocation | ||||
Corporate Bonds | 96.7% | |||
Repurchase Agreements | 1.5% | |||
Common Stock | 0.2% | |||
Warrants | 0.1% | |||
Preferred Stocks | 0.0% | |||
Other assets in excess of liabilities | 1.5% | |||
100.0% |
Top Holdings* | ||||
Qwest Corp., 8.88%, 03/15/12 | 1.4% | |||
Intelsat Bermuda Ltd., 11.25%, 06/15/16 | 0.9% | |||
HCA, Inc., 9.63%, 11/15/16 | 0.9% | |||
CDRV Investors, Inc., , 01/01/15 | 0.9% | |||
Jostens, Inc., 7.63%, 10/01/12 | 0.8% | |||
Tennessee Gas Pipeline, Inc., 8.38%, 06/15/32 | 0.8% | |||
HCA, Inc., 9.25%, 11/15/16 | 0.7% | |||
Charter Communications, 10.25%, 09/15/10 | 0.7% | |||
Dex Media West/ Finance Series B, 9.88%, 08/15/13 | 0.7% | |||
General Motors Acceptance Corp., 8.00%, 11/01/31 | 0.6% | |||
Other | 91.6% | |||
100.0% |
Top Industries | ||||
Media | 11.9% | |||
Health Care Providers & Services | 8.2% | |||
Food Products | 6.1% | |||
Industrial Conglomerates | 6.0% | |||
Gas Utilities | 5.5% | |||
Gaming | 5.0% | |||
Chemicals | 4.9% | |||
Technology | 4.6% | |||
Consumer Goods | 4.2% | |||
Automobiles | 4.2% | |||
Other | 39.4% | |||
100.0% |
* | For purpose of listing top holdings, repurchase agreements are included as part of Other. |
Federated NVIT High Income Bond Fund
Common Stock (0.2%) | |||||||||
Shares or | |||||||||
Principal Amount | Value | ||||||||
Chemicals (0.1%) (a) (b) | |||||||||
General Chemical Industrial Products, Inc.* | 143 | $ | 206,043 | ||||||
Consumer Goods (0.0%) (a) (b) (c) | |||||||||
Membership Units | 185 | 2 | |||||||
Containers & Packaging (0.0%) | |||||||||
Pliant Corp. * (b) (c) | 1 | 0 | |||||||
Russell Stanley Holdings, Inc. (a) (b) (c) | 4,000 | 0 | |||||||
Smurfit Kappa PLC* | 1,558 | 39,212 | |||||||
39,212 | |||||||||
Media (0.1%) | |||||||||
Virgin Media, Inc. | 5,650 | 137,690 | |||||||
Total Common Stocks (Cost $790,671) | 382,947 | ||||||||
Corporate Bonds (96.7%) | |||||||||
Aerospace & Defense (2.1%) | |||||||||
Alliant Techsystems, Inc., 6.75%, 04/01/16 | $ | 800,000 | 780,000 | ||||||
DRS Technologies, Inc., 6.63%, 02/01/16 | 725,000 | 703,250 | |||||||
Hawker Beechcraft Acq Co. (c) (d) 8.88%, 04/01/15 | 825,000 | 851,812 | |||||||
9.75%, 04/01/17 | 525,000 | 549,938 | |||||||
L-3 Communications Corp. 6.13%, 01/15/14 | 1,425,000 | 1,350,187 | |||||||
5.88%, 01/15/15 | 300,000 | 279,750 | |||||||
6.38%, 10/15/15 | 375,000 | 356,250 | |||||||
Transdigm Inc., 7.75%, 07/15/14 (c) (d) | 375,000 | 380,625 | |||||||
5,251,812 | |||||||||
Auto Components (0.7%) | |||||||||
Cooper-Standard Automotive, Inc., 8.38%, 12/15/14 | 500,000 | 468,750 | |||||||
Tenneco Automotive, Inc., 8.63%, 11/15/14 | 300,000 | 310,500 | |||||||
United Components, Inc., 9.38%, 06/15/13 | 1,025,000 | 1,063,438 | |||||||
1,842,688 | |||||||||
Automobiles (4.2%) | |||||||||
Ford Motor Co., 7.45%, 07/16/31 | 1,150,000 | 924,312 | |||||||
Ford Motor Credit Co. 9.88%, 08/10/11 | 425,000 | 446,468 | |||||||
7.25%, 10/25/11 | 975,000 | 939,219 | |||||||
Ford Motor Credit Company 8.11%, 01/13/12 (e) | 1,350,000 | 1,347,840 | |||||||
8.00%, 12/15/16 | 1,100,000 | 1,055,337 | |||||||
General Motors Acceptance Corp. 6.88%, 09/15/11 | 1,575,000 | 1,550,644 | |||||||
8.00%, 11/01/31 | 1,625,000 | 1,666,186 | |||||||
General Motors Corp. 7.13%, 07/15/13 | 450,000 | 423,563 | |||||||
7.40%, 09/01/25 | 1,800,000 | 1,525,500 | |||||||
8.38%, 07/15/33 | 725,000 | 665,187 | |||||||
10,544,256 | |||||||||
Building Products (1.3%) | |||||||||
Goodman Global Holdings 8.36%, 06/15/12 (e) | 250,000 | 252,500 | |||||||
7.88%, 12/15/12 | 275,000 | 273,625 | |||||||
Norcraft Cos. LLC, 9.00%, 11/01/11 | 500,000 | 518,750 | |||||||
Norcraft Holdings LP 0.00%, 09/01/12 (f) | 500,000 | 460,000 | |||||||
Nortek Holdings, Inc. 0.00%, 03/01/14 (f) | 300,000 | 219,000 | |||||||
8.50%, 09/01/14 | 350,000 | 335,125 | |||||||
Panolam Industries International, Inc., 10.75%, 10/01/13 (c) (d) | 1,125,000 | 1,181,250 | |||||||
Texas Industries, Inc., 7.25%, 07/15/13 | 150,000 | 151,125 | |||||||
3,391,375 | |||||||||
Chemicals (4.7%) | |||||||||
Compass Minerals Intl. 0.00%, 12/15/12 (f) | 500,000 | 516,250 | |||||||
0.00%, 06/01/13 | 1,050,000 | 1,047,375 | |||||||
Equistar Chemical, 10.13%, 09/01/08 | 62,750 | 65,574 | |||||||
Hexion Specialty Chemicals, 9.75%, 11/15/14 | 1,425,000 | 1,482,000 | |||||||
Invista, 9.25%, 05/01/12 (c) (d) | 950,000 | 1,009,375 |
Corporate Bonds (continued) | |||||||||
Shares or | |||||||||
Principal Amount | Value | ||||||||
Chemicals (continued) | |||||||||
Lyondell Chemical Co. 10.88%, 05/01/09 | $ | 450,000 | $ | 450,000 | |||||
8.25%, 09/15/16 | 1,400,000 | 1,470,000 | |||||||
6.88%, 06/15/17 | 550,000 | 533,500 | |||||||
Mosaic Corp. (c) (d) 7.38%, 12/01/14 | 225,000 | 228,375 | |||||||
7.63%, 12/01/16 | 525,000 | 539,437 | |||||||
Nalco Co. 8.88%, 11/15/13 | 1,100,000 | 1,146,750 | |||||||
0.00%, 02/01/14 (f) | 481,000 | 440,115 | |||||||
Nell AF SARL, 8.38%, 08/15/15 (c) (d) | 800,000 | 770,000 | |||||||
PQ Corp., 7.50%, 02/15/13 | 625,000 | 665,625 | |||||||
Terra Capital, Inc., 7.00%, 02/01/17 | 975,000 | 945,750 | |||||||
Union Carbide Corp. 7.88%, 04/01/23 | 225,000 | 239,529 | |||||||
7.50%, 06/01/25 | 350,000 | 359,246 | |||||||
11,908,901 | |||||||||
Construction & Engineering (0.3%) | |||||||||
Case New Holland, Inc., 9.25%, 08/01/11 | 675,000 | 710,910 | |||||||
Construction Materials (0.0%) (b) (g) (h) | |||||||||
Clark Material Handling, Inc. 0.00%, 11/15/06 | 100,000 | 0 | |||||||
Consumer Goods (5.1%) | |||||||||
AAC Group Holding Corp. 0.00%, 10/01/12 (f) | 1,025,000 | 927,625 | |||||||
AAC Group Holding Corp. PIK, 14.75%, 10/01/12 | 359,758 | 396,633 | |||||||
American Achievement Corp., 8.25%, 04/01/12 | 600,000 | 607,500 | |||||||
American Greetings, 7.38%, 06/01/16 | 725,000 | 735,875 | |||||||
Church & Dwight Co., 6.00%, 12/15/12 | 900,000 | 867,375 | |||||||
Constellation Brands, Inc., 7.25%, 09/01/16 | 375,000 | 367,500 | |||||||
Jarden Corp., 7.50%, 05/01/17 | 1,325,000 | 1,315,063 | |||||||
Jostens Holding Corp. 0.00%, 12/01/13 (f) | 1,675,000 | 1,545,187 | |||||||
Jostens, Inc., 7.63%, 10/01/12 | 2,075,000 | 2,075,000 | |||||||
Leiner Health Products, 11.00%, 06/01/12 | 500,000 | 475,000 | |||||||
Playtex Products, Inc., 9.38%, 06/01/11 | 1,300,000 | 1,342,250 | |||||||
Spectrum Brands, Inc., 7.38%, 02/01/15 | 340,000 | 274,975 | |||||||
True Temper Sports, Inc., 8.38%, 09/15/11 | 1,100,000 | 968,000 | |||||||
Visant Holding Corp., 8.75%, 12/01/13 | 900,000 | 940,500 | |||||||
12,838,483 | |||||||||
Containers & Packaging (2.3%) | |||||||||
Ball Corp., 6.63%, 03/15/18 | 1,025,000 | 986,563 | |||||||
Berry Plastics Corp., 8.88%, 09/15/14 | 1,025,000 | 1,042,937 | |||||||
Crown Americas, 7.75%, 11/15/15 | 1,100,000 | 1,111,000 | |||||||
Graphic Packaging International, 9.50%, 08/15/13 | 1,150,000 | 1,200,312 | |||||||
Owens-Brockway Glass Container, 6.75%, 12/01/14 | 800,000 | 784,000 | |||||||
Owens-Illinois, Inc., 7.35%, 05/15/08 | 300,000 | 302,250 | |||||||
Plastipak Holdings, Inc., 8.50%, 12/15/15 (c) (d) | 350,000 | 364,000 | |||||||
Russell Stanley Holdings, Inc., 9.00%, 11/30/08 (b) (c) (g) | 14,589 | 677 | |||||||
5,791,739 | |||||||||
Electric Power (0.5%) | |||||||||
NRG Energy, Inc., 7.38%, 02/01/16 | 1,375,000 | 1,381,875 | |||||||
Electric Utilities (3.8%) | |||||||||
CMS Energy Corp., 7.50%, 01/15/09 | 600,000 | 618,276 | |||||||
Dynegy Holdings, Inc., 7.75%, 06/01/19 (c) (d) | 1,400,000 | 1,309,000 | |||||||
Edison Mission Energy 7.75%, 06/15/16 | 1,350,000 | 1,350,000 | |||||||
7.00%, 05/15/17 (c) (d) | 1,325,000 | 1,255,438 | |||||||
FPL Energy National Wind, 6.13%, 03/25/19 (c) (d) | 306,649 | 299,432 | |||||||
Nevada Power Co. 6.50%, 04/15/12 | 75,000 | 76,748 | |||||||
5.88%, 01/15/15 | 350,000 | 343,648 |
Federated NVIT High Income Bond Fund (Continued)
Corporate Bonds (continued) | |||||||||
Shares or | |||||||||
Principal Amount | Value | ||||||||
Electric Utilities (continued) | |||||||||
Nevada Power Corp., 6.50%, 05/15/18 | $ | 625,000 | $ | 634,605 | |||||
Northwestern Corp., 5.88%, 11/01/14 | 200,000 | 194,370 | |||||||
NRG Energy Inc., 7.38%, 01/15/17 | 550,000 | 553,438 | |||||||
NRG Energy, Inc., 7.25%, 02/01/14 | 375,000 | 376,875 | |||||||
PSEG Energy Holdings, 10.00%, 10/01/09 | 1,125,000 | 1,215,154 | |||||||
Sierra Pacific Resources, 6.75%, 08/15/17 | 650,000 | 642,239 | |||||||
TECO Energy, Inc., 6.75%, 05/01/15 | 225,000 | 230,622 | |||||||
TXU Corp., 5.55%, 11/15/14 | 650,000 | 555,053 | |||||||
9,654,898 | |||||||||
Energy Companies (3.0%) | |||||||||
Chesapeake Energy Corp. 7.50%, 09/15/13 | 375,000 | 383,437 | |||||||
6.88%, 01/15/16 | 525,000 | 515,812 | |||||||
6.88%, 11/15/20 | 875,000 | 842,187 | |||||||
Cimarex Energy Corp., 7.13%, 05/01/17 | 325,000 | 318,500 | |||||||
Forest Oil Corporation, 7.25%, 06/15/19 (c) (d) | 700,000 | 682,500 | |||||||
Hilcorp Energy (c) (d) 7.75%, 11/01/15 | 550,000 | 536,250 | |||||||
9.00%, 06/01/16 | 475,000 | 494,000 | |||||||
Petroplus Finance Ltd (c) (d) 6.75%, 05/01/14 | 225,000 | 217,688 | |||||||
7.00%, 05/01/17 | 500,000 | 483,750 | |||||||
Pioneer Natural Resources, 6.88%, 05/01/18 | 850,000 | 810,109 | |||||||
Plains Exploration, 7.75%, 06/15/15 | 750,000 | 748,125 | |||||||
Plains Exploration, Inc., 7.00%, 03/15/17 | 375,000 | 357,188 | |||||||
Range Resources Corp. 7.38%, 07/15/13 | 250,000 | 253,750 | |||||||
6.38%, 03/15/15 | 450,000 | 428,625 | |||||||
7.50%, 05/15/16 | 550,000 | 559,625 | |||||||
7,631,546 | |||||||||
Energy Equipment & Services (0.8%) | |||||||||
Basic Energy Services, 7.13%, 04/15/16 | 950,000 | 912,000 | |||||||
Cie General De Geophysique 7.50%, 05/15/15 | 100,000 | 100,500 | |||||||
7.75%, 05/15/17 | 400,000 | 407,000 | |||||||
Complete Production Services, Inc., 8.00%, 12/15/16 (c) (d) | 500,000 | 507,500 | |||||||
Grant Prideco, Inc., 6.13%, 08/15/15 | 200,000 | 190,500 | |||||||
2,117,500 | |||||||||
Entertainment (1.3%) | |||||||||
Cinemark, Inc. 0.00%, 03/15/14 (f) | 1,525,000 | 1,395,375 | |||||||
Hard Rock Park Operation, 10.12%, 04/01/12 (e) (c) (d) | 575,000 | 577,875 | |||||||
Universal City Development, 11.75%, 04/01/10 | 950,000 | 1,009,375 | |||||||
Universal City Florida Holding Co., 10.11%, 05/01/10 (e) | 250,000 | 256,250 | |||||||
3,238,875 | |||||||||
Environmental (1.2%) | |||||||||
Allied Waste Industries, 9.25%, 05/01/21 | 475,000 | 508,250 | |||||||
Allied Waste North America 9.25%, 09/01/12 | 300,000 | 315,375 | |||||||
7.13%, 05/15/16 | 1,650,000 | 1,621,125 | |||||||
6.88%, 06/01/17 | 275,000 | 267,437 | |||||||
Clean Harbors, Inc., 11.25%, 07/15/12 | 341,000 | 378,268 | |||||||
3,090,455 | |||||||||
Food & Staples Retailing (0.0%) (b) (c) (g) | |||||||||
Jitney-Jungle Stores of America, Inc. 0.00%, 09/15/07 | 100,000 | 0 | |||||||
Food Products (6.1%) | |||||||||
ASG Consolidated LLC 0.00%, 11/01/11 (f) | 1,675,000 | 1,566,125 | |||||||
B&G Foods, Inc., 8.00%, 10/01/11 | 1,100,000 | 1,105,500 | |||||||
Constellation Brands, Inc. 8.00%, 02/15/08 | 650,000 | 656,500 | |||||||
7.25%, 05/15/17 (c) (d) | 575,000 | 563,500 | |||||||
Cott Beverages, Inc., 8.00%, 12/15/11 | 900,000 | 913,500 |
Corporate Bonds (continued) | |||||||||
Shares or | |||||||||
Principal Amount | Value | ||||||||
Food Products (continued) | |||||||||
Dean Foods Co., 7.00%, 06/01/16 | $ | 1,175,000 | $ | 1,128,000 | |||||
Del Monte Corp., 6.75%, 02/15/15 | 1,425,000 | 1,364,438 | |||||||
Eurofresh, Inc., 11.50%, 01/15/13 (c) (d) | 775,000 | 775,000 | |||||||
Michael Foods, 8.00%, 11/15/13 | 1,500,000 | 1,522,500 | |||||||
Nutro Products, Inc., 10.75%, 04/15/14 (c) (d) | 600,000 | 700,225 | |||||||
Pierre Foods, Inc., 9.88%, 07/15/12 | 800,000 | 816,000 | |||||||
Pilgrim’s Pride Corp., 8.38%, 05/01/17 | 1,050,000 | 1,044,750 | |||||||
Pinnacle Foods LLC (c) (d) 9.25%, 04/01/15 | 650,000 | 630,500 | |||||||
10.63%, 04/01/17 | 650,000 | 628,875 | |||||||
Reddy Ice Group 0.00%, 11/01/12 | 1,025,000 | 968,625 | |||||||
Smithfield Foods, Inc. 7.75%, 05/15/13 | 200,000 | 204,000 | |||||||
7.75%, 07/01/17 | 900,000 | 904,500 | |||||||
15,492,538 | |||||||||
Gaming (5.0%) | |||||||||
Fontainebleau Las Vegas, 10.25%, 06/15/15 (c) (d) | 375,000 | 371,250 | |||||||
Global Cash Access LLC, 8.75%, 03/15/12 | 503,000 | 524,377 | |||||||
Great Canadian Gaming Co., 7.25%, 02/15/15 (c) (d) | 550,000 | 550,000 | |||||||
Herbst Casinos & Gambling, Inc., 7.00%, 11/15/14 | 850,000 | 801,125 | |||||||
Jacobs Entertainment, Inc., 9.75%, 06/15/14 | 925,000 | 965,469 | |||||||
Mandalay Resort Group 10.25%, 08/01/07 | 1,150,000 | 1,154,312 | |||||||
9.50%, 08/01/08 | 250,000 | 258,750 | |||||||
MGM Grand, Inc., 8.38%, 02/01/11 | 700,000 | 719,250 | |||||||
MGM Mirage, Inc., 5.88%, 02/27/14 | 550,000 | 500,500 | |||||||
Mgm Mirage, Inc., 7.50%, 06/01/16 | 1,400,000 | 1,335,250 | |||||||
MTR Casinos & Gambling Group, Inc., 9.75%, 04/01/10 | 800,000 | 836,000 | |||||||
Mtr Gaming Group, Inc., 9.00%, 06/01/12 | 425,000 | 449,438 | |||||||
Penn National Casinos & Gambling, Inc., 6.75%, 03/01/15 | 925,000 | 952,750 | |||||||
San Pasqual Casino, 8.00%, 09/15/13 (c) (d) | 800,000 | 812,000 | |||||||
Shingle Springs, 9.38%, 06/15/15 (c) (d) | 350,000 | 354,813 | |||||||
Station Casinos, Inc., 7.75%, 08/15/16 | 525,000 | 522,375 | |||||||
Tunica-Biloxi Casinos & Gambling Authority, 9.00%, 11/15/15 (c) (d) | 625,000 | 656,250 | |||||||
Wynn Las Vegas LLC, 6.63%, 12/01/14 | 950,000 | 920,312 | |||||||
12,684,221 | |||||||||
Gas Utilities (5.5%) | |||||||||
Amerigas Partners LP, 7.13%, 05/20/16 | 1,075,000 | 1,061,562 | |||||||
EL Paso Corp., 7.80%, 08/01/31 | 1,450,000 | 1,475,603 | |||||||
Holly Energy Partners LP, 6.25%, 03/01/15 | 1,375,000 | 1,292,500 | |||||||
Inergy LP, 6.88%, 12/15/14 | 1,400,000 | 1,333,500 | |||||||
Pacific Energy Partners 7.13%, 06/15/14 | 700,000 | 724,984 | |||||||
6.25%, 09/15/15 | 150,000 | 147,582 | |||||||
Regency Energy Partners, 8.38%, 12/15/13 (c) (d) | 850,000 | 879,750 | |||||||
Semco Energy, Inc., 7.13%, 05/15/08 | 500,000 | 504,472 | |||||||
Southern Star Central Corp., 6.75%, 03/01/16 | 625,000 | 618,750 | |||||||
Tennessee Gas Pipeline, Inc. 7.50%, 04/01/17 | 200,000 | 216,208 | |||||||
8.38%, 06/15/32 | 1,675,000 | 1,972,477 | |||||||
Transcontinental Gas Pipeline Corp. 8.88%, 07/15/12 | 350,000 | 393,750 | |||||||
6.40%, 04/15/16 | 500,000 | 503,750 | |||||||
Williams Cos., Inc. (The) 7.63%, 07/15/19 | 1,125,000 | 1,192,500 | |||||||
7.88%, 09/01/21 | 1,425,000 | 1,539,000 | |||||||
13,856,388 | |||||||||
Federated NVIT High Income Bond Fund (Continued)
Corporate Bonds (continued) | |||||||||
Shares or | |||||||||
Principal Amount | Value | ||||||||
Health Care Equipment & Supplies (0.8%) | |||||||||
Accellent, Inc., 10.50%, 12/01/13 | $ | 700,000 | $ | 698,250 | |||||
Advanced Medical Optics, 7.50%, 05/01/17 (c) (d) | 650,000 | 617,500 | |||||||
Varietal Distribution, 10.25%, 07/15/15 (c) (d) | 800,000 | 802,000 | |||||||
2,117,750 | |||||||||
Health Care Providers & Services (8.2%) | |||||||||
AmeriPath, Inc. 0.00%, 02/15/14 (e) (c) (d) | 575,000 | 575,000 | |||||||
AMR Holding Co./ Emcare H, 10.00%, 02/15/15 | 600,000 | 651,000 | |||||||
Aramark Corp. (c) (d) 8.50%, 02/01/15 | 550,000 | 562,375 | |||||||
8.86%, 02/01/15 (e) | 750,000 | 765,000 | |||||||
CDRV Investors, Inc. 0.00%, 01/01/15 (f) | 2,425,000 | 2,218,875 | |||||||
Concentra Operating Corp., 9.50%, 08/15/10 | 560,000 | 588,700 | |||||||
CRC Health Corp., 10.75%, 02/01/16 | 875,000 | 966,875 | |||||||
HCA, Inc. 6.38%, 01/15/15 | 1,300,000 | 1,108,250 | |||||||
9.25%, 11/15/16 (c) (d) | 1,650,000 | 1,761,375 | |||||||
9.63%, 11/15/16 (c) (d) | 2,175,000 | 2,343,562 | |||||||
7.50%, 11/06/33 | 900,000 | 767,250 | |||||||
National Mentor Hldgs., 11.25%, 07/01/14 | 1,125,000 | 1,220,625 | |||||||
Omnicare, Inc., 6.88%, 12/15/15 | 1,000,000 | 955,000 | |||||||
Psychiatric Solutions, Inc. 7.75%, 07/15/15 (c) (d) | 75,000 | 74,531 | |||||||
7.75%, 07/15/15 | 875,000 | 869,531 | |||||||
Triad Hospitals, Inc., 7.00%, 11/15/13 | 62,000 | 65,329 | |||||||
United Surgical Partners (c) (d) 8.88%, 05/01/17 | 175,000 | 176,313 | |||||||
9.25%, 05/01/17 | 900,000 | 906,750 | |||||||
Universal Hospital Services (c) (d) 8.50%, 06/01/15 | 175,000 | 174,125 | |||||||
8.76%, 06/01/15 (e) | 200,000 | 201,000 | |||||||
Vanguard Health Holdings, 9.00%, 10/01/14 | 750,000 | 746,250 | |||||||
Ventas Realty LP 6.63%, 10/15/14 | 1,050,000 | 1,040,813 | |||||||
7.13%, 06/01/15 | 325,000 | 329,063 | |||||||
6.75%, 04/01/17 | 500,000 | 496,250 | |||||||
Viant Holdings, Inc., 9.88%, 07/15/17 (c) (d) | 325,000 | 328,250 | |||||||
VWR International, Inc., 8.00%, 04/15/14 | 750,000 | 802,961 | |||||||
20,695,053 | |||||||||
Health Care Technology (0.5%) | |||||||||
Bio Rad Laboratories, Inc., 6.13%, 12/15/14 | 525,000 | 496,125 | |||||||
Fisher Scientific International, Inc., 6.13%, 07/01/15 | 800,000 | 786,750 | |||||||
1,282,875 | |||||||||
Hotels, Restaurants & Leisure (1.8%) | |||||||||
Dave & Buster’s, Inc., 11.25%, 03/15/14 | 675,000 | 695,250 | |||||||
EL Pollo Loco, Inc., 11.75%, 11/15/13 | 400,000 | 424,000 | |||||||
Host Marriott LP 7.13%, 11/01/13 | 450,000 | 451,688 | |||||||
6.88%, 11/01/14 | 400,000 | 397,500 | |||||||
6.38%, 03/15/15 | 450,000 | 434,250 | |||||||
6.75%, 06/01/16 | 375,000 | 369,375 | |||||||
MGM Mirage, Inc., 6.00%, 10/01/09 | 500,000 | 498,125 | |||||||
Royal Caribbean Cruises 7.00%, 06/15/13 | 550,000 | 555,098 | |||||||
7.25%, 06/15/16 | 300,000 | 297,901 | |||||||
Seminole Hard Rock Ent., 7.86%, 03/15/14 (e) (c) (d) | 550,000 | 556,875 | |||||||
4,680,062 | |||||||||
Industrial Conglomerates (5.9%) | |||||||||
ALH Finance LLC/ ALH Finance Corp., 8.50%, 01/15/13 | 1,375,000 | 1,371,562 | |||||||
American Tire Distributor, 10.75%, 04/01/13 | 600,000 | 615,000 | |||||||
Baker & Taylor, Inc., 11.50%, 07/01/13 (c) (d) | 1,000,000 | 1,050,000 | |||||||
Belden Cdt, Inc., 7.00%, 03/15/17 (c) (d) | 375,000 | 371,250 | |||||||
Da-Lite Screen Co., Inc., 9.50%, 05/15/11 | 525,000 | 553,875 | |||||||
Education Management Llc, 10.25%, 06/01/16 | 1,275,000 | 1,348,313 |
Corporate Bonds (continued) | |||||||||
Shares or | |||||||||
Principal Amount | Value | ||||||||
Industrial Conglomerates (continued) | |||||||||
Esco Corp (d) 8.63%, 12/15/13 (c) | $ | 500,000 | $ | 527,500 | |||||
9.24%, 12/15/13 (e) | 250,000 | 256,250 | |||||||
Hawk Corp., 8.75%, 11/01/14 | 625,000 | 646,875 | |||||||
Interline Brands Inc, 8.13%, 06/15/14 | 800,000 | 810,000 | |||||||
Knowledge Learning Corp., 7.75%, 02/01/15 (c) (d) | 1,400,000 | 1,361,500 | |||||||
Mueller Water Products, 7.38%, 06/01/17 (c) (d) | 325,000 | 323,898 | |||||||
Norcross Safety Products, 9.88%, 08/15/11 | 750,000 | 791,250 | |||||||
Rental Services Corp., 9.50%, 12/01/14 (c) (d) | 750,000 | 768,750 | |||||||
Safety Products Holdings, 11.75%, 01/01/12 | 961,897 | 1,014,802 | |||||||
Sensus Metering Systems, 8.63%, 12/15/13 | 575,000 | 586,500 | |||||||
Stanadyne Corp., 10.00%, 08/15/14 | 700,000 | 743,750 | |||||||
Stanadyne Holdings, Inc. 0.00%, 02/15/15 (f) | 450,000 | 375,750 | |||||||
Superior Essex Communications, 9.00%, 04/15/12 | 725,000 | 743,125 | |||||||
Valmont Industries, Inc., 6.88%, 05/01/14 | 650,000 | 641,875 | |||||||
14,901,825 | |||||||||
Machinery (0.3%) | |||||||||
Baldor Electric Co., 8.63%, 02/15/17 | 750,000 | 796,875 | |||||||
Manufacturing (1.2%) | |||||||||
Chemtura Corp., 6.88%, 06/01/16 | 1,100,000 | 1,045,000 | |||||||
K&F Acquisition, Inc., 7.75%, 11/15/14 | 500,000 | 532,500 | |||||||
Koppers, Inc., 9.88%, 10/15/13 | 715,000 | 766,838 | |||||||
Owens-Brockway Glass Container, 8.25%, 05/15/13 | 150,000 | 156,000 | |||||||
Sealy Mattress Co., 8.25%, 06/15/14 | 600,000 | 618,000 | |||||||
3,118,338 | |||||||||
Media (11.7%) | |||||||||
Affinity Group Holding PIK, 10.88%, 02/15/12 | 824,904 | 882,647 | |||||||
Affinity Group, Inc., 9.00%, 02/15/12 | 425,000 | 454,750 | |||||||
Cablevision Systems Corp. 7.88%, 12/15/07 | 375,000 | 378,281 | |||||||
8.13%, 07/15/09 | 250,000 | 255,625 | |||||||
CBD Media Finance, Inc., 8.63%, 06/01/11 | 125,000 | 126,875 | |||||||
CBD Media Holdings, 9.25%, 07/15/12 | 1,175,000 | 1,222,000 | |||||||
CCH II LLC, 10.25%, 10/01/13 | 300,000 | 322,500 | |||||||
Charter Communications, 10.25%, 09/15/10 | 1,675,000 | 1,758,750 | |||||||
CSC Holdings, Inc., 7.25%, 07/15/08 | 325,000 | 328,250 | |||||||
Dex Media East LLC, 12.13%, 11/15/12 | 325,000 | 350,594 | |||||||
Dex Media West/ Finance Series B, 9.88%, 08/15/13 | 1,591,000 | 1,710,325 | |||||||
DIRECTV Holdings LLC 8.38%, 03/15/13 | 844,000 | 887,255 | |||||||
6.38%, 06/15/15 | 400,000 | 377,000 | |||||||
Echostar DBS Corp. 5.75%, 10/01/08 | 1,250,000 | 1,250,000 | |||||||
6.63%, 10/01/14 | 650,000 | 622,375 | |||||||
Idearc, Inc., 8.00%, 11/15/16 | 1,375,000 | 1,395,625 | |||||||
Intelsat Bermuda Ltd. 8.87%, 01/15/15 (e) (c) (d) | 300,000 | 307,875 | |||||||
11.25%, 06/15/16 | 2,125,000 | 2,390,625 | |||||||
Intelsat Intermediate 0.00%, 02/01/15 (f) | 1,925,000 | 1,592,937 | |||||||
Intelsat Sub Holdings Co. Ltd., 8.63%, 01/15/15 | 725,000 | 746,750 | |||||||
Kabel Deutschland GMBH, 10.63%, 07/01/14 | 1,250,000 | 1,375,000 | |||||||
Lamar Media Corp. 7.25%, 01/01/13 | 550,000 | 551,375 | |||||||
6.63%, 08/15/15 | 125,000 | 119,063 | |||||||
6.63%, 08/15/15 | 750,000 | 714,375 | |||||||
Local TV Finance LLC, 9.25%, 06/15/15 (c) (d) | 600,000 | 597,000 | |||||||
Medimedia Usa, Inc., 11.38%, 11/15/14 (c) (d) | 600,000 | 646,500 | |||||||
PanAmSat Corp., 9.00%, 08/15/14 | 453,000 | 474,518 |
Federated NVIT High Income Bond Fund (Continued)
Corporate Bonds (continued) | |||||||||
Shares or | |||||||||
Principal Amount | Value | ||||||||
Media (continued) | |||||||||
Quebecor Media, 7.75%, 03/15/16 | $ | 525,000 | $ | 535,500 | |||||
R.H. Donnelley Corp., 10.88%, 12/15/12 | 575,000 | 614,531 | |||||||
Rainbow National Services LLC, 10.38%, 09/01/14 (c) (d) | 625,000 | 689,063 | |||||||
Reader’s Digest Assoc., 9.00%, 02/15/17 (c) (d) | 700,000 | 658,000 | |||||||
RH Donnelley 6.88%, 01/15/13 | 400,000 | 381,000 | |||||||
6.88%, 01/15/13 | 750,000 | 714,375 | |||||||
8.88%, 01/15/16 | 775,000 | 809,875 | |||||||
SGS International, Inc., 12.00%, 12/15/13 | 1,150,000 | 1,259,250 | |||||||
Umbrella Acquisition, 9.75%, 03/15/15 (c) (d) | 250,000 | 248,125 | |||||||
Videotron Ltee, 6.38%, 12/15/15 | 325,000 | 310,375 | |||||||
WDAC Subsidiary Corp., 8.38%, 12/01/14 (c) (d) | 1,250,000 | 1,318,750 | |||||||
XM Satellite, 9.75%, 05/01/14 | 400,000 | 394,000 | |||||||
29,771,714 | |||||||||
Metals & Mining (1.0%) | |||||||||
Aleris International, Inc. (c) (d) 9.00%, 12/15/14 | 600,000 | 608,250 | |||||||
10.00%, 12/15/16 | 475,000 | 473,813 | |||||||
Freeport-Mcmoran Copper, 8.38%, 04/01/17 | 725,000 | 775,750 | |||||||
Novelis, Inc., 7.25%, 02/15/15 | 712,000 | 734,250 | |||||||
2,592,063 | |||||||||
Other Financial (0.3%) | |||||||||
American Real Estate Partners LP, 7.13%, 02/15/13 | 675,000 | 654,750 | |||||||
Paper & Forest Products (0.7%) | |||||||||
Jefferson Smurfit Corp., 8.25%, 10/01/12 | 490,000 | 488,775 | |||||||
MDP Acquisitions PLC, 9.63%, 10/01/12 | 65,000 | 68,413 | |||||||
NewPage Corp., 12.00%, 05/01/13 | 1,125,000 | 1,234,687 | |||||||
1,791,875 | |||||||||
Semiconductors & Semiconductor Equipment (0.2%) (d) | |||||||||
Freescale Semiconductor, 8.88%, 12/15/14 | 625,000 | 600,000 | |||||||
Service Companies (0.8%) | |||||||||
West Corp, 9.50%, 10/15/14 | 575,000 | 592,250 | |||||||
West Corp., 11.00%, 10/15/16 | 1,275,000 | 1,338,750 | |||||||
1,931,000 | |||||||||
Specialty Retail (3.7%) | |||||||||
Autonation, Inc. 7.36%, 04/15/13 (e) | 675,000 | 676,688 | |||||||
7.00%, 04/15/14 | 250,000 | 248,125 | |||||||
Claire’s Stores, Inc., 10.50%, 06/01/17 (c) (d) | 1,025,000 | 940,438 | |||||||
Couche-Tard Financing Co., 7.50%, 12/15/13 | 1,325,000 | 1,341,562 | |||||||
FTD, Inc., 7.75%, 02/15/14 | 690,000 | 686,550 | |||||||
General Cable Corp. (c) (d) 7.73%, 04/01/15 (e) | 650,000 | 653,250 | |||||||
7.13%, 04/01/17 | 325,000 | 323,375 | |||||||
General Nutrition Center, 9.80%, 03/15/14 (e) | 750,000 | 727,500 | |||||||
NBC Acquisition Corp. 0.00%, 03/15/13 (f) | 1,000,000 | 920,000 | |||||||
Nebraska Book Co., 8.63%, 03/15/12 | 1,125,000 | 1,122,187 | |||||||
U.S. Office Products Co. 0.00%, 06/15/08 (b) (g) (h) | 455,359 | 0 | |||||||
United Auto Group, Inc., 7.75%, 12/15/16 | 650,000 | 650,000 | |||||||
Yankee Acquisition Corp 8.50%, 02/15/15 | 250,000 | 243,750 | |||||||
9.75%, 02/15/17 | 950,000 | 923,875 | |||||||
9,457,300 | |||||||||
Technology (4.6%) | |||||||||
Activant Solutions, 9.50%, 05/01/16 | 1,100,000 | 1,086,250 | |||||||
CHR Intermediate Holding Corp., 12.61%, 06/01/13 (e) (c) (d) | 425,000 | 423,406 | |||||||
Compucom Systems, Inc., 12.00%, 11/01/14 (c) (d) | 650,000 | 702,000 | |||||||
Deluxe Corp. 5.13%, 10/01/14 | 525,000 | 448,875 | |||||||
7.38%, 06/01/15 (c) (d) | 125,000 | 125,000 |
Corporate Bonds (continued) | |||||||||
Shares or | |||||||||
Principal Amount | Value | ||||||||
Technology (continued) | |||||||||
Ipayment, Inc., 9.75%, 05/15/14 | $ | 750,000 | $ | 753,750 | |||||
MagnaChip Semiconductor, 8.00%, 12/15/14 | 350,000 | 257,250 | |||||||
Open Solutions, Inc., 9.75%, 02/01/15 (c) (d) | 1,025,000 | 1,040,375 | |||||||
Seagate Technology, 6.80%, 10/01/16 | 675,000 | 651,375 | |||||||
Serena Software, Inc., 10.38%, 03/15/16 | 875,000 | 947,188 | |||||||
Smart Modular Technologies, Inc., 10.85%, 04/01/12 (e) | 405,000 | 427,275 | |||||||
SS&C Technologies, Inc., 11.75%, 12/01/13 | 900,000 | 1,012,500 | |||||||
SunGard Data Systems, Inc. 9.13%, 08/15/13 | 1,070,000 | 1,100,762 | |||||||
10.25%, 08/15/15 | 1,150,000 | 1,221,875 | |||||||
Xerox Corp. 9.75%, 01/15/09 | 650,000 | 687,832 | |||||||
7.63%, 06/15/13 | 475,000 | 497,783 | |||||||
6.40%, 03/15/16 | 300,000 | 302,349 | |||||||
11,685,845 | |||||||||
Telephones (1.4%) | |||||||||
Qwest Corp., 8.88%, 03/15/12 | 3,300,000 | 3,572,250 | |||||||
Textiles, Apparel & Luxury Goods (0.2%) | |||||||||
Glenoit Corp. 0.00%, 12/31/49 (b) (g) (h) | 125,000 | 0 | |||||||
Warnaco Group, Inc., 8.88%, 06/15/13 | 575,000 | 609,500 | |||||||
609,500 | |||||||||
Tobacco (0.5%) | |||||||||
Reynolds American, Inc., 7.75%, 06/01/18 | 1,225,000 | 1,313,283 | |||||||
Transportation (1.1%) | |||||||||
Hertz Corp. 8.88%, 01/01/14 | 700,000 | 733,250 | |||||||
10.50%, 01/01/16 | 1,075,000 | 1,193,250 | |||||||
Holt Group, Inc. (The) 0.00%, 01/15/06 (b) (g) (h) | 50,000 | 0 | |||||||
Stena AB 7.50%, 11/01/13 | 575,000 | 583,625 | |||||||
7.00%, 12/01/16 | 250,000 | 251,250 | |||||||
2,761,375 | |||||||||
Wireless Telecommunication Services (3.9%) | |||||||||
Centennial Cellular Corp., 11.10%, 01/01/13 (e) | 575,000 | 603,750 | |||||||
Centennial Communication, 10.00%, 01/01/13 | 750,000 | 808,125 | |||||||
Citizens Communications 6.25%, 01/15/13 | 250,000 | 240,938 | |||||||
9.00%, 08/15/31 | 550,000 | 569,250 | |||||||
Digicel Group Ltd. (c) (d) 9.25%, 09/01/12 | 475,000 | 502,906 | |||||||
8.88%, 01/15/15 | 275,000 | 270,188 | |||||||
9.13%, 01/15/15 | 575,000 | 568,531 | |||||||
MetroPCS Wireless, Inc. (c) (d) 9.25%, 11/01/14 | 425,000 | 440,938 | |||||||
9.25%, 11/01/14 | 675,000 | 700,313 | |||||||
Nextel Communications, 7.38%, 08/01/15 | 875,000 | 875,382 | |||||||
Rogers Wireless, Inc. 7.25%, 12/15/12 | 200,000 | 211,409 | |||||||
8.00%, 12/15/12 | 800,000 | 852,173 | |||||||
6.38%, 03/01/14 | 1,125,000 | 1,138,539 | |||||||
U.S. Unwired, Inc., 10.00%, 06/15/12 | 650,000 | 704,016 | |||||||
Valor Telecommunications, 7.75%, 02/15/15 | 650,000 | 684,215 | |||||||
Windstream Corp., 8.63%, 08/01/16 | 600,000 | 637,500 | |||||||
9,808,173 | |||||||||
Total Corporate Bonds (Cost $242,119,560) | 245,570,366 | ||||||||
Preferred Stock (0.0%) | |||||||||
Media (0.0%) | |||||||||
Ziff Davis Media, Inc., Series E-1, PIK | 12 | 240 | |||||||
Repurchase Agreements (1.5%) | |||||||||
Nomura Securities, 5.20% dated 06/29/07, due 07/02/07, repurchase price $3,882,640, collateralized by U.S. Government Agency Mortgages with a market value of $3,958,577 | $ | 3,880,958 | 3,880,958 | ||||||
Federated NVIT High Income Bond Fund (Continued)
Warrants (0.1%)* | ||||||||
Shares or | ||||||||
Principal Amount | Value | |||||||
Chemicals (0.0%) (a) (b) | ||||||||
General Chemical Industrial Products Series A, expiring 06/01/10 (h) | $ | 83 | $ | 103,371 | ||||
General Chemical Industrial Products Series B, expiring 06/01/10 (h) | 61 | 64,955 | ||||||
168,326 | ||||||||
Entertainment (0.0%) (b) (c) | ||||||||
AMF Bowling Worldwide, Inc., Class B, expiring 03/09/09 | 811 | 0 | ||||||
Industrial Conglomerate (0.1%) (c) (d) | ||||||||
ACP Holding Co., expiring 09/13/13 | 96,400 | 168,700 | ||||||
Media (0.0%) | ||||||||
XM Satellite Radio Warrants | 300 | 315 | ||||||
Ziff Davis Media, Inc., expiring 08/12/12 * (b) | 2,200 | 0 | ||||||
315 | ||||||||
Total Warrants (Cost $169,493) | 337,341 | |||||||
Total Investments (Cost $246,960,682) (i) — 98.5% | 250,171,852 | |||||||
Other assets in excess of liabilities — 1.5% | 3,716,606 | |||||||
NET ASSETS — 100.0% | $ | 253,888,458 | ||||||
* | Denotes a non-income producing security. | |
(a) | Fair Valued Security. | |
(b) | Illiquid security. | |
(c) | Denotes a restricted security that either (a) cannot be offered sale without first being registered, or being able to tak advantage of an exemption from registration, under the Securities Act of 1933, or (b) is subject to a contractual restriction on public sales | |
(d) | Denotes a restricted security that may be resold without restriction to “qualified institutional buyers” as defined by Rule 144A under the Securities Act of 1933 and that the Fund has determined to be liquid under criteria established by the Fund’s Board of Trustees. | |
(e) | Variable Rate Security. The rate reflected in the Statement of Investments is the rate in effect on June 30, 2007. The maturity date represents the actual maturity date. | |
(f) | Step Bond: Coupon rate is set for an initial period and then increased to a higher coupon rate at a specified date. The rate shown is the rate in effect at June 30, 2007. | |
(g) | Issuer has filed for bankruptcy protection. | |
(h) | Security in default. | |
(i) | See notes to financial statements for tax unrealized appreciation (depreciation) of securities. |
LP | Limited Partnership | |
PIK | Paid-In-Kind |
Federated | ||||||
NVIT High | ||||||
Income Bond Fund | ||||||
Assets: | ||||||
Investments, at value (cost $243,079,724) | $ | 246,290,894 | ||||
Repurchase agreements, at cost and value | 3,880,958 | |||||
Total Investments | 250,171,852 | |||||
Interest and dividends receivable | 4,661,509 | |||||
Receivable for capital shares issued | 38,853 | |||||
Receivable for investments sold | 449,140 | |||||
Prepaid expenses | 3,108 | |||||
Total Assets | 255,324,462 | |||||
Liabilities: | ||||||
Payable to custodian | 578,722 | |||||
Payable for investments purchased | 431,500 | |||||
Payable for capital shares redeemed | 159,353 | |||||
Accrued expenses and other payables: | ||||||
Investment advisory fees | 151,241 | |||||
Fund administration and transfer agent fees | 21,265 | |||||
Administrative servicing fees | 61,810 | |||||
Compliance program costs | 3,338 | |||||
Other | 28,775 | |||||
Total Liabilities | 1,436,004 | |||||
Net Assets | $ | 253,888,458 | ||||
Represented by: | ||||||
Capital | $ | 262,731,960 | ||||
Accumulated net investment income | 616,946 | |||||
Accumulated net realized losses from investment transactions | (12,671,618 | ) | ||||
Net unrealized appreciation on investments | 3,211,170 | |||||
Net Assets | $ | 253,888,458 | ||||
Net Assets: | ||||||
Class I Shares | $ | 147,187,870 | ||||
Class III Shares | 106,700,588 | |||||
Total | $ | 253,888,458 | ||||
Shares outstanding (unlimited number of shares authorized): | ||||||
Class I Shares | 18,553,095 | |||||
Class III Shares | 13,462,285 | |||||
Total | 32,015,380 | |||||
Net asset value and offering price per share (Net assets by class divided by shares outstanding by class, respectively.): | ||||||
Class I Shares | $ | 7.93 | ||||
Class III Shares | $ | 7.92 | (a) | |||
(a) | The NAV reported above represents the traded NAV at June 30, 2007. Due to the financial statement rounding of class assets and class shares above, the NAV results in a different NAV than the traded NAV. |
2007 Semiannual Report 15
Federated NVIT | |||||
High Income | |||||
Bond Fund | |||||
INVESTMENT INCOME: | |||||
Interest income | $ | 10,727,667 | |||
Dividend income | 283 | ||||
Total Income | 10,727,950 | ||||
Expenses: | |||||
Investment advisory fees | 899,889 | ||||
Fund administration and transfer agent fees | 104,396 | ||||
Administrative servicing fees Class I Shares | 145,202 | ||||
Administrative servicing fees Class III Shares | 87,483 | ||||
Custodian fees | 1,876 | ||||
Trustee fees | 6,100 | ||||
Compliance program costs (Note 3) | 1,786 | ||||
Other | 35,820 | ||||
Total expenses before earnings credit | 1,282,552 | ||||
Earnings credit (Note 6) | (938 | ) | |||
Net Expenses | 1,281,614 | ||||
Net Investment Income | 9,446,336 | ||||
REALIZED/ UNREALIZED GAINS (LOSSES) FROM INVESTMENTS: | |||||
Net realized gains on investment transactions | 1,705,232 | ||||
Net change in unrealized depreciation on investments | (3,592,158 | ) | |||
Net realized/unrealized gains (losses) on investments | (1,886,926 | ) | |||
CHANGE IN NET ASSETS RESULTING FROM OPERATIONS | $ | 7,559,410 | |||
16 Semiannual Report 2007
Federated NVIT High Income Bond Fund | |||||||||
Six Months Ended | Year Ended | ||||||||
June 30,2007 | December 31, 2006 | ||||||||
(Unaudited) | |||||||||
FROM INVESTMENT ACTIVITIES: | |||||||||
Operations: | |||||||||
Net investment income | $ | 9,446,336 | $ | 18,026,824 | |||||
Net realized gains on investment transactions | 1,705,232 | 282,045 | |||||||
Net change in unrealized appreciation/depreciation on investments | (3,592,158 | ) | 6,604,282 | ||||||
Change in net assets resulting from operations | 7,559,410 | 24,913,151 | |||||||
Distributions to Shareholders from: | |||||||||
Net investment income: | |||||||||
Class I | (5,120,810 | ) | (11,799,884 | ) | |||||
Class III | (3,854,868 | ) | (6,080,652 | ) | |||||
Change in net assets from shareholder distributions | (8,975,678 | ) | (17,880,536 | ) | |||||
Change in net assets from capital transactions | (3,576,864 | ) | 6,679,483 | ||||||
Change in net assets | (4,993,132 | ) | 13,712,098 | ||||||
Net Assets: | |||||||||
Beginning of period | 258,881,590 | 245,169,492 | |||||||
End of period | $ | 253,888,458 | $ | 258,881,590 | |||||
Accumulated net investment income at end of period | $ | 616,946 | $ | 146,288 | |||||
CAPITAL TRANSACTIONS: | |||||||||
Class I Shares | |||||||||
Proceeds from shares issued | $ | 7,857,133 | $ | 9,847,813 | |||||
Dividends reinvested | 5,120,810 | 11,799,884 | |||||||
Cost of shares redeemed (a) | (20,157,730 | ) | (53,118,692 | ) | |||||
(7,179,787 | ) | (31,470,995 | ) | ||||||
Class III Shares | |||||||||
Proceeds from shares issued | 30,468,457 | 59,463,380 | |||||||
Dividends reinvested | 3,854,867 | 6,080,652 | |||||||
Cost of shares redeemed (a) | (30,720,401 | ) | (27,393,554 | ) | |||||
3,602,923 | 38,150,478 | ||||||||
Change in net assets from capital transactions | $ | (3,576,864 | ) | $ | 6,679,483 | ||||
SHARE TRANSACTIONS: | |||||||||
Class I Shares | |||||||||
Issued | 965,929 | 1,244,893 | |||||||
Reinvested | 639,532 | 1,510,198 | |||||||
Redeemed | (2,482,538 | ) | (6,747,865 | ) | |||||
(877,077 | ) | (3,992,774 | ) | ||||||
Class III Shares | |||||||||
Issued | 3,749,692 | 7,583,360 | |||||||
Reinvested | 481,685 | 776,959 | |||||||
Redeemed | (3,798,188 | ) | (3,483,429 | ) | |||||
433,189 | 4,876,890 | ||||||||
Total change in shares | (443,888 | ) | 884,116 | ||||||
(a) | Includes redemption fees, if any. |
2007 Semiannual Report 17
Distributions | ||||||||||||||||||||||||||||||||
Investment Activities | ||||||||||||||||||||||||||||||||
Net Realized | ||||||||||||||||||||||||||||||||
and | ||||||||||||||||||||||||||||||||
Net Asset | Unrealized | Total | ||||||||||||||||||||||||||||||
Value, | Net | Gains | from | Net | Net Asset | |||||||||||||||||||||||||||
Beginning | Investment | (Losses) on | Investment | Investment | Total | Value, End | Total | |||||||||||||||||||||||||
of Period | Income | Investments | Activities | Income | Distributions | of Period | Return (a) | |||||||||||||||||||||||||
Class I Shares | ||||||||||||||||||||||||||||||||
For the year ended December 31, 2002 | $ | 7.44 | $ | 0.61 | $ | (0.38 | ) | $ | 0.23 | $ | (0.61 | ) | $ | (0.61 | ) | $ | 7.06 | 3.23% | ||||||||||||||
For the year ended December 31, 2003 | $ | 7.06 | $ | 0.57 | $ | 0.96 | $ | 1.53 | $ | (0.57 | ) | $ | (0.57 | ) | $ | 8.02 | 22.27% | |||||||||||||||
For the year ended December 31, 2004 | $ | 8.02 | $ | 0.60 | $ | 0.18 | $ | 0.78 | $ | (0.60 | ) | $ | (0.60 | ) | $ | 8.20 | 10.10% | |||||||||||||||
For the year ended December 31, 2005 | $ | 8.20 | $ | 0.64 | $ | (0.46 | ) | $ | 0.18 | $ | (0.61 | ) | $ | (0.61 | ) | $ | 7.77 | 2.38% | ||||||||||||||
For the year ended December 31, 2006 | $ | 7.77 | $ | 0.60 | $ | 0.19 | $ | 0.79 | $ | (0.58 | ) | $ | (0.58 | ) | $ | 7.98 | 10.60% | |||||||||||||||
For the six months ended June 30, 2007 (Unaudited) | $ | 7.98 | $ | 0.30 | $ | (0.07 | ) | $ | 0.23 | $ | (0.28 | ) | $ | (0.28 | ) | $ | 7.93 | 2.84% | ||||||||||||||
Class III Shares | ||||||||||||||||||||||||||||||||
For the year ended December 31, 2005 (f) | $ | 7.83 | $ | 0.39 | $ | 0.01 | $ | 0.40 | $ | (0.47 | ) | $ | (0.47 | ) | $ | 7.76 | 5.14% | |||||||||||||||
For the year ended December 31, 2006 | $ | 7.76 | $ | 0.57 | $ | 0.22 | $ | 0.79 | $ | (0.58 | ) | $ | (0.58 | ) | $ | 7.97 | 10.60% | |||||||||||||||
For the six months ended June 30, 2007 (Unaudited) | $ | 7.97 | $ | 0.30 | $ | (0.07 | ) | $ | 0.23 | $ | (0.28 | ) | $ | (0.28 | ) | $ | 7.92 | 2.86% |
[Additional columns below]
[Continued from above table, first column(s) repeated]
Ratios / Supplemental Data | ||||||||||||||||||||||||||
Ratio of Net | ||||||||||||||||||||||||||
Ratio of | Investment | |||||||||||||||||||||||||
Ratio of Net | Expenses | Income | ||||||||||||||||||||||||
Net Assets | Ratio of | Investment | (Prior to | (Prior to | ||||||||||||||||||||||
at End of | Expenses to | Income to | Reimbursements) | Reimbursements) | ||||||||||||||||||||||
Period | Average Net | Average Net | to Average | to Average | Portfolio | |||||||||||||||||||||
(000s) | Assets (b) | Assets (b) | Net Assets (b)(c) | Net Assets (b)(c) | Turnover (d) | |||||||||||||||||||||
Class I Shares | ||||||||||||||||||||||||||
For the year ended December 31, 2002 | $ | 162,733 | 0.97% | 8.82% | 0.97% | 8.82% | 30.59% | |||||||||||||||||||
For the year ended December 31, 2003 | $ | 268,336 | 0.95% | 7.74% | (e) | (e) | 41.30% | |||||||||||||||||||
For the year ended December 31, 2004 | $ | 302,285 | 0.94% | 7.46% | (e) | (e) | 61.24% | |||||||||||||||||||
For the year ended December 31, 2005 | $ | 181,905 | 0.96% | 7.35% | (e) | (e) | 37.06% | |||||||||||||||||||
For the year ended December 31, 2006 | $ | 155,024 | 0.94% | 7.38% | (e) | (e) | 42.91% | |||||||||||||||||||
For the six months ended June 30, 2007 (Unaudited) | $ | 147,188 | 0.98% | 7.07% | 0.98% | 7.07% | 22.89% | |||||||||||||||||||
Class III Shares | ||||||||||||||||||||||||||
For the year ended December 31, 2005 (f) | $ | 63,264 | 0.95% | 7.23% | (e) | (e) | 37.06% | |||||||||||||||||||
For the year ended December 31, 2006 | $ | 103,857 | 0.96% | 7.37% | (e) | (e) | 42.91% | |||||||||||||||||||
For the six months ended June 30, 2007 (Unaudited) | $ | 106,701 | 0.94% | 7.09% | 0.94% | 7.09% | 22.89% |
(a) | Not annualized for periods less than one year. |
(b) | Annualized for periods less than one year. |
(c) | During the period, certain fees were waived and/or reimbursed. If such waivers/reimbursements had not occurred, the ratios would have been as indicated. |
(d) | Portfolio turnover is calculated on the basis of the Fund as a whole without distinguishing among the classes of shares. |
(e) | There were no fee reductions during the period. |
(f) | For the period from April 28, 2005 (commencement of operations) through December 31, 2005. |
[Additional columns below]
[Continued from above table, first column(s) repeated]
1. Organization
Nationwide Variable Insurance Trust (“NVIT” or the “Trust”) is an open-end management investment company, organized under the laws of Delaware by an amended and restated Agreement and Declaration of Trust, dated October 28, 2004, as amended to date. Prior to May 1, 2007, the Trust was named “Gartmore Variable Insurance Trust”. The Trust, originally created under the laws of Massachusetts as a Massachusetts business trust pursuant to a Declaration of Trust dated, as of June 30, 1981, and as subsequently amended, redomesticated as a Delaware Statutory Trust after the close of trading on April 29, 2005, and is registered under the Investment Company Act of 1940, as amended (the “1940 Act”). The redomestication was a change in statutory status and did not affect the operations of the Trust. As of June 30, 2007, the Trust had authorized an unlimited number of shares of beneficial interest, without par value (“shares”). The Trust currently offers shares to life insurance company separate accounts to fund the benefits under variable life insurance or annuity policies. To date, only the separate accounts of Nationwide Life Insurance Company and Nationwide Life and Annuity Insurance Company (collectively, “Nationwide”) have purchased shares of the Federated NVIT High Income Bond Fund (the “Fund”), (formerly, “Federated GVIT High Income Bond Fund”). The Trust currently operates forty (40) separate series, or mutual funds, each with its own investment objectives and strategies. This report contains the financial statements and financial highlights of the Fund.
2. Summary of Significant Accounting Policies
The following is a summary of significant accounting policies followed by the Fund in the preparation of its financial statements. The policies are in conformity with accounting principles generally accepted in the United States of America (“GAAP”). The preparation of financial statements requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of income and expenses for the period. Actual results could differ from those estimates.
(a) | Security Valuation |
Securities for which market quotations are readily available are valued at current market value as of “Valuation Time.” Valuation Time is as of the close of regular trading on the New York Stock Exchange (usually 4 p.m. Eastern time). Equity securities are valued at the last quoted sale price or, if there is no sale price, the last quoted bid price provided by an independent pricing service approved by the Trust’s Board of Trustees (“Board of Trustees”). Securities traded on NASDAQ are valued at the NASDAQ official closing price. Prices are taken from the primary market or exchange in which each security trades. | |
Most securities listed on a foreign exchange are valued either at fair value (see description below) or at the last sale price at the close of the exchange on which the security is principally traded. Foreign securities, currencies, and other assets and liabilities denominated in foreign currencies are translated into U.S. dollars at the exchange rate of said currencies against the U.S. dollar, as of Valuation Time, as provided by an independent pricing service approved by the Board of Trustees. | |
Debt (including defaulted issues) and other fixed income securities (other than short-term obligations) are valued at the last quoted bid price and/or by using a combination of daily quotes and matrix evaluations provided by an independent pricing service, the use of which has been approved by the Board of Trustees. Short-term debt securities, such as commercial paper and U.S. Treasury Bills having a remaining maturity of 60 days or less at the time of purchase, are considered to be “short-term” and are valued at amortized cost which, approximates market value. | |
Securities for which market quotations are not readily available, or for which an independent pricing service does not provide a value or provides a value that does not represent fair value in the judgment of the Fund’s investment adviser or designee, are valued at fair value under procedures approved by the Board of Trustees. The “Fair Value” of these securities is determined in good faith by taking into account relevant factors and surrounding circumstances. Methods utilized to obtain a “Fair Value” may include the following non-exclusive list of acceptable methods: (i) a multiple of earnings; (ii) the discount from market value of a similar, freely traded security; (iii) the yield-to-maturity |
for debt issues; or (iv) a consolidation of the methods. The Trust’s Valuation & Operations Committee considers a non-exclusive list of factors to arrive at the appropriate method of determining “Fair Value.” For example, fair value determinations are required for securities whose value is affected by a “significant” event that materially affects the value of a domestic or foreign security which occurs subsequent to the time of the close of the principal market on which such domestic or foreign security trades and before the Valuation Time (i.e., a “subsequent event”). Typically, this will involve events occurring after the close of a foreign market on which a security trades and before the next Valuation Time. | |
The Fund values foreign securities at fair value in the circumstances described below. Generally, trading in foreign securities markets is completed each day at various times prior to the Valuation Time. Due to the time differences between the closings of the relevant foreign securities exchanges and the Valuation Time for the Fund, the Fund will fair value its foreign investments when it is determined that the market quotations for the foreign investments either are not readily available or are unreliable and, therefore, do not represent fair value. When the fair value prices are utilized, these prices will attempt to reflect the impact of the U.S. financial markets’ perceptions and trading activities on the Fund’s foreign investments since the last closing prices of the foreign investments were calculated on their primary foreign securities markets or exchanges. For these purposes, the Board of Trustees has determined that movements in relevant indices or other appropriate market indicators, after the close of the foreign securities exchanges, may demonstrate that market quotations are unreliable, and may trigger fair value pricing for certain securities. Consequently, fair valuation of portfolio securities may occur on a daily basis. |
(b) | Repurchase Agreements |
The Fund may enter into repurchase agreements with an entity which is a member of the Federal Reserve System or which is a “primary dealer” (as designated by the Federal Reserve Bank of New York) in U.S. Government obligations. The repurchase price generally equals the price paid by the Fund plus interest negotiated on the basis of current short-term rates, which may be more or less than the rate on the underlying portfolio securities. The seller under a repurchase agreement is required to maintain the value of the collateral held pursuant to the agreement at a market value equal to or greater than the repurchase price (including accrued interest). Collateral subject to repurchase agreements is held by the Fund’s custodian or another qualified sub-custodian or in the Federal Reserve/Treasury book-entry system. If the counterparty defaults and the fair value of the collateral declines, realization of the collateral by the Fund may be delayed or limited. The Fund may transfer uninvested cash balances into a pooled cash account. These balances are invested in one or more repurchase agreements, with the counterparty of Nomura Securities, which is fully collateralized by U.S. Government Agency Mortgages. |
(c) | Foreign Currency Transactions |
The accounting records of the Fund are maintained in U.S. dollars. Foreign currency amounts are translated into U.S. dollars at the current rate of exchange to determine the value of investments, assets and liabilities. The Fund may enter into foreign currency contracts in connection with purchases or sales of securities denominated in a foreign currency. Purchases and sales of securities, and income and expenses, are translated at the prevailing rate of exchange on the respective date of these transactions. The Fund does not isolate that portion of the results of operations resulting from changes in foreign exchange rates on investments from fluctuations arising from changes in market prices of securities held. These fluctuations are included with the net realized and unrealized gain or loss from investments and foreign currencies. |
(d) | Forward Foreign Currency Contracts |
The Fund may enter into forward foreign currency contracts in connection with planned purchases or sales of securities or to hedge the U.S. dollar value of portfolio securities denominated in a particular currency. The Fund could be exposed to risks if the counterparties to the contracts are unable to meet the terms of their contracts and from unanticipated movements in the value of a foreign currency relative to the U.S. dollar. Forward foreign currency contracts are valued at the current cost of covering these contracts, as provided by an independent pricing service |
approved by the Board of Trustees. The forward foreign currency contracts are adjusted by the daily exchange rate of the underlying currency and any gains or losses are recorded for financial statement purposes as unrealized gains or losses until the contract settlement date. |
(e) | Futures Contracts |
The Fund may invest in financial futures contracts (“futures contracts”) for the purpose of hedging its existing portfolio securities or securities that the Fund intends to purchase against fluctuations in value caused by changes in prevailing market interest rates or prices. Futures contracts may also be entered into for non-hedging purposes. | |
Upon entering into a futures contract, the Fund is required to pledge to the broker an amount of cash and/or other assets equal to a certain percentage of the contract amount (initial margin deposit). Subsequent payments, known as “variation margin,” are made each day, depending on the daily fluctuations in the fair value/market value of the underlying assets. A gain or loss equal to the daily variation margin is recognized on a daily basis. Futures contracts are valued daily at their last quoted sale price. | |
A “sale” of a futures contract means the creation of a contractual obligation to deliver the securities or foreign currency called for by the contract at a fixed price at a specified time in the future. A “purchase” of a futures contract means the creation of a contractual obligation to acquire the securities or foreign currency at a fixed price at a specified time in the future. | |
Should market conditions change unexpectedly, the Fund may not achieve the anticipated benefits of the futures contracts and may realize a loss. The use of futures transactions for hedging purposes involves the risk of imperfect correlation in movements in the price of futures contracts, interest rates, and the value of the underlying hedged assets. |
(f) | Written Options Contracts |
The Fund may write options contracts. A written option obligates the Fund to deliver (written call) or to receive (written put) a specified quantity of an underlying asset at the contract amount upon exercise by the holder of the option. When the Fund writes an option, an amount equal to the premium received by the Fund is recorded as a liability and is subsequently adjusted to the current fair value of the option written. Premiums received from writing options that expire unexercised are treated by the Fund on the expiration date as realized gains from investments. The difference between the premium and the amount paid on effecting a closing purchase transaction, as a realized loss. If a call option is exercised, the premium is added to the proceeds from the sale of the underlying security or currency in determining whether the Fund has realized a gain or loss. If a put option is exercised, the premium reduces the cost basis of the securities purchased by the Fund. Options traded on an exchange are valued at the last quoted sale price, or in the absence of a sale, the bid price provided by an independent pricing service approved by the Board of Trustees. Non-exchange traded options are valued using dealer supplied quotes. The Fund as a writer of an option bears the market risk of an unfavorable change in the price of the security underlying the written option. |
(g) | Security Transactions and Investment Income |
Security transactions are accounted for on the date the security is purchased or sold (“trade date”). Securities gains and losses are calculated on the identified cost basis. Interest income is recognized on the accrual basis and includes, where applicable, the amortization or accretion of premium or discount. |
(h) | Securities Lending |
To generate additional income, the Fund may lend its portfolio securities, up to 33 1/3% of the Fund, to brokers, dealers and other financial institutions provided that (1) the borrower delivers cash or securities as collateral with respect to each new loan of U.S. securities, equal to at least 102% of the value of the portfolio securities loaned, and with respect to each new loan on non-U.S. securities, collateral of at least 105% of the value of the portfolio securities loaned; and (2) at all times thereafter shall require the borrower to mark-to-market the collateral on a daily |
basis so that the market value of such collateral does not fall below 100% of the value of securities loaned. The Fund receives payments from borrowers equivalent to the dividends and interest that would have been earned on securities loaned while simultaneously seeking to earn income on the investment of cash collateral. There may be risks of delay in recovery of the securities should the borrower of the securities fail financially. Loans will be made, however, only to borrowers deemed by the Fund’s investment adviser to be of good standing and creditworthy under guidelines established by the Board of Trustees and when, in judgment of the adviser, the consideration which can be earned currently from these securities loans justifies the attendant risks. Loans are subject to termination by the Fund or the borrower at any time, and, therefore, are not considered to be illiquid investments. JPMorgan Chase Bank serves as custodian for the securities lending program of the Fund. JPMorgan Chase Bank receives a fee based on the value of the collateral received from borrowers. As of June 30, 2007, the Fund did not have securities on loan. |
(i) | Distributions to Shareholders |
The Fund’s dividends from net investment income, if any, are declared and paid quarterly. The Fund’s distributions from net realized capital gains, if any, are declared and distributed at least annually. | |
Dividends and distributions to shareholders are determined in accordance with federal income tax regulations, which may differ from GAAP. These “book/tax” differences are considered either permanent or temporary in nature. In accordance with the American Institute of Certified Public Accountants Statement of Position 93-2, permanent differences (i.e., reclassification of market discounts, foreign exchange gain/loss, paydowns, and distributions from real estate investment trusts) are reclassified within the capital accounts based on their nature for federal income tax purposes; temporary differences do not require reclassification. These reclassifications have no effect upon the net asset value of the Fund. To the extent distributions exceed current and accumulated earnings and profits for federal income tax purposes, these distributions are reported as distributions of paid-in-capital. |
(j) | Federal Income Taxes |
It is the policy of the Fund to qualify or to continue to qualify as a “regulated investment company” by complying with the provisions available to certain investment companies, as defined in Subchapter M of the U.S. Internal Revenue Code, and to make distributions of net investment income and net realized capital gains sufficient to relieve the Fund from all, or substantially all, federal income taxes. | |
As of June 30, 2007, the tax cost of securities and the breakdown of unrealized appreciation (depreciation) for the Fund was as follows: |
Tax Cost | Net Unrealized | |||||||||||||||||
of | Unrealized | Unrealized | Appreciation | |||||||||||||||
Securities | Appreciation | Depreciation | (Depreciation) | |||||||||||||||
$ | 246,960,682 | $ | 7,351,355 | $ | (4,140,185 | ) | $ | 3,211,170 | ||||||||||
(k) | Allocation of Expenses, Income, and Gains and Losses |
Expenses directly attributable to the Fund are charged to the Fund. Expenses not directly attributable to the Fund are allocated proportionately among various or all funds within the Trust. The method used by the Fund for allocating income, fund level expenses, and realized and unrealized gains or losses is based on the fair value of shares outstanding relative to net assets. Under this method, each class of shares participates based on the total net asset value of that class’s shares in proportion to the total net assets of the Fund. Expenses specific to a class (such as Rule 12b-1 and administrative services fees) are charged to that class. |
3. Transactions with Affiliates
Under the terms of the Trust’s Investment Advisory Agreement, Nationwide Fund Advisors (formerly, Gartmore Mutual Fund Capital Trust (“GMF”)) (“NFA” or the “Advisor”) manages the investment of the assets and supervises the daily
Under the terms of the Investment Advisory Agreement, the Fund pays NFA an investment advisory fee based on that Fund’s average daily net assets. Additional information regarding investment advisory fees and subadvisory fees for NFA and the subadviser is as follows for the six months ended June 30, 2007:
Fee Schedule | Total Fees | |||||
Up to $50 million | 0.80% | |||||
Next $200 million | 0.65% | |||||
Next $250 million | 0.60% | |||||
$500 million or more | 0.55% | |||||
From such fees, pursuant to the subadvisory agreement, NFA paid the subadviser $366,082 for the six months ended June 30, 2007.
Under the terms of a Fund Administration and Transfer Agency Agreement, Nationwide Fund Management, LLC (formerly, Gartmore Investor Services, Inc. (“GISI”)) (“NFM”), a wholly-owned subsidiary of NFS Distributors, Inc. (“NFSDI”), provides the Fund with various administrative and accounting services for the Fund (prior to May 1, 2007, this service was provided by Gartmore SA Capital Trust (“GSA”)), and serves as Transfer and Dividend Disbursing Agent for the Fund (prior to May 1, 2007, this service was provided by GISI, an indirect subsidiary of GSA.) The fees for the services provided under this Agreement are calculated based on the Trust’s average daily net assets according to the fee schedule below. The fees are then allocated proportionately among all funds within the Trust in relation to the average daily net assets of each fund and are paid to NFA. NFA pays NFM from these fees for NFM’s services.
Combined Fee Schedule* | ||||||
Up to $1 billion | 0.15% | |||||
$1 billion up to $3 billion | 0.10% | |||||
$3 billion up to $8 billion | 0.05% | |||||
$8 billion up to $10 billion | 0.04% | |||||
$10 billion up to $12 billion | 0.02% | |||||
$12 billion or more | 0.01% | |||||
* | The assets of the Nationwide NVIT Investor Destinations Aggressive Fund, the Nationwide NVIT Investor Destinations Moderately Aggressive Fund, the Nationwide NVIT Investor Destinations Moderate Fund, the Nationwide NVIT Investor Destinations Moderately Conservative Fund, and the Nationwide NVIT Investor Destinations Conservative Fund (collectively, the “Investor Destinations Funds”) are excluded from the Trust asset level amount in order to calculate this asset-based fee. The Investor Destinations Funds do not pay any part of this fee. |
NFA and NFM have entered into agreements with Citi Fund Services Ohio, Inc. (“Citi”), pursuant to which Citi provides sub-administration and sub-transfer agency services, respectively, to the Fund. Effective August 1, 2007, The BISYS Group Inc. was acquired by and became a wholly owned subsidiary of Citi.
Under the terms of an Administrative Services Plan, the Fund may pay fees to servicing organizations, such as broker-dealers, including NFS, and financial institutions, which agree to provide administrative support services to the shareholders of certain classes. These services include, but are not limited, to the following: establishing and maintaining shareholder accounts; processing purchase and redemption transactions; arranging bank wires; performing shareholder sub-accounting; answering inquires regarding the Fund; and other such services. These fees are based on an annual rate of up to 0.25% of the average daily net assets of each class of shares of the Fund.
For the six months ended June 30, 2007, NFS received $200,056 in Administrative Services Fees from the Fund.
Under the terms of a letter agreement dated September 12, 2006, by and among NFA, the Audit Committee of the Trust and the Trust, the Trust has agreed to reimburse NFA certain costs related to the Fund’s portion of ongoing administration, monitoring and annual (audit) testing of the Trust’s Rule 38a-1 Compliance Program subject to the pre-approval of the Trust’s Audit Committee. For the six months ended June 30, 2007, the Fund’s portion of such costs amounted to $1,786.
4. Short-Term Trading Fees
The Fund reserves the right to assess a short-term trading fee on certain transactions out of Class III shares that a separate account makes on behalf of a variable insurance contract owner (the “contract owner”). A separate account that redeems Class III shares on behalf of a contract owner may be subject to a 1.00% short-term trading fee if the separate account held the Class III shares on behalf of the contract owner for 60 days or less, unless an exception applies as disclosed in the Fund’s prospectus. The short-term trading fee is paid directly to the Fund and is intended to offset the cost to the Fund of excess brokerage commissions and other costs associated with fluctuations in Fund asset levels and cash flow caused by short-term trading. For purposes of determining whether the short-term trading fee applies, the Class III shares that were held on behalf of the contract owner the longest will be treated as being redeemed first.
For the six months ended June 30, 2007, the Fund had contributions to capital due to collection of redemption fees in the amount of $14,376.
5. Investment Transactions
For the six months ended June 30, 2007, (excluding short-term securities) the Fund had purchases of $63,285,252 and sales of $58,019,112.
6. Bank Loans and Earnings Credit
The Trust has a credit agreement with JPMorgan Chase & Co., the Fund’s custodian bank, permitting the Trust to borrow up to $100,000,000. Borrowings under this arrangement bear interest at the Federal Funds rate plus 0.50%. The interest costs, if any, would be included in other fees in the Statement of Operations. No compensating balances were required under the terms of the line of credit. The line of credit is renewed annually, expiring on June 25, 2008, with a commitment fee of 0.07% per year on $100,000,000. There were no borrowings outstanding under this line of credit for the six months ended June 30, 2007.
The Trust’s custodian bank has agreed to reduce the bank’s fees (earnings credit) when the funds of the Trust maintain cash on deposit in non-interest-bearing custody and Demand Deposit Accounts. Earnings credits are shown as a reduction of total expenses on the Statement of Operations.
7. Portfolio Investment Risks
Risks Associated with Foreign Securities and Currencies. Investments in securities of foreign issuers carry certain risks not ordinarily associated with investments in securities of U.S. issuers. These risks include future political and economic developments, and the possible imposition of exchange controls or other foreign governmental laws and restrictions. In addition, with respect to certain countries, there is the possibility of expropriation of assets, confiscatory taxation, political or social instability, or diplomatic developments, which could adversely affect investments in those countries.
Certain countries also may impose substantial restrictions on investments in their capital markets by foreign entities, including restrictions on investments in issuers of industries deemed sensitive to relevant national interests. These factors may limit the investment opportunities available and result in a lack of liquidity and high price volatility with respect to securities of issuers from developing countries.
Credit and Market Risk. The Fund invests in high yield and emerging market instruments that are subject to certain additional credit and market risks. The yields of emerging market debt obligations reflect, among other things, perceived
8. Indemnifications
Under the Trust’s organizational documents, certain of the Trust’s Officers and Trustees are indemnified against certain liabilities arising out of the performance of their duties to the Trust. In addition, the Trust has entered into Indemnification Agreements with the Trust’s trustees and certain officers covering similar liabilities. Trust Officers receive no compensation from the Trust for serving as the Trust’s Officers. In addition, in the normal course of business, the Trust enters into contracts with its vendors and others that provide for general indemnifications. The Trust’s maximum exposure under these arrangements is unknown, as this would involve future claims that may be made against the Trust. Based on experience, however, the Trust expects that risk of loss to be remote.
9. Recently Issued Accounting Pronouncements
On July 13, 2006, the Financial Accounting Standards Board (“FASB”) released FASB Interpretation No. 48, Accounting for Uncertainty in Income Taxes (“FIN 48”). FIN 48 provides guidance for how uncertain tax positions should be recognized, measured, presented and disclosed in the financial statements. FIN 48 requires the affirmative evaluation of tax positions taken or expected to be taken in the course of preparing the Fund’s tax returns to determine whether it is more-likely-than-not (i.e., greater than 50 percent) that each tax position will be sustained upon examination by a taxing authority based on the technical merits of the position. A tax position that meets the more-likely-than-not recognition threshold is measured to determine the amount of benefit to recognize in the financial statements. Differences between tax positions taken in a tax return and amounts recognized in the financial statements will generally result in an increase in a liability for taxes payable (or a reduction of a tax refund receivable) and an increase in a deferred tax liability (or a reduction in a deferred tax asset). Adoption of FIN 48 was required no later than the last business day of the first financial statement reporting period for fiscal years beginning after December 15, 2006 and is to be applied to all open tax years as of the effective date. Accordingly, the Fund was required to implement FIN 48 in its net asset value per share (NAV) calculation on June 29, 2007. Management has evaluated the implications of FIN 48 and has concluded that there was no impact to the Fund’s financial statements as of June 29, 2007. The adoption of FIN 48 requires ongoing monitoring and analysis, future conclusions reached by management may be different and result in adjustments to the Fund’s NAV and financial statements.
In September 2006, the FASB issued Statement on Financial Accounting Standards (“SFAS”) No. 157, “Fair Value Measurements.” This standard establishes a single authoritative definition of fair value, sets out a framework for measuring fair value and requires additional disclosures about fair value measurements. SFAS No. 157 applies to fair value measurements already required or permitted by existing standards. SFAS No. 157 is effective for financial statements issued for fiscal years beginning after November 15, 2007 and interim periods within those fiscal years. The changes to current accounting principles generally accepted in the United States of America from the application of this Statement relate to the definition of fair value, the methods used to measure fair value, and the expanded disclosures about fair value measurements. As of June 30, 2007, the Fund does not believe the adoption of SFAS No. 157 will impact the financial statement amounts; however, additional disclosures may be required about the inputs used to develop the measurements and the effect of certain of the measurements on changes in net assets for the period.
Trustees who are not Interested Persons (as defined in the 1940 Act) and Officers of the Trust as of
Number of Portfolios | ||||||||||
Position(s) Held | in the | |||||||||
with the Trust | Principal Occupation(s) | Nationwide Fund | Other | |||||||
Name, Address | and Length of | During Past | Complex Overseen | Directorships | ||||||
and Year of Birth | Time Served1 | Five Years | by Trustee | Held by Trustee2 | ||||||
Charles E. Allen c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1948 | Trustee since July 2000 | Mr. Allen is Chairman, Chief Executive Officer and President of Graimark Realty Advisors, Inc. (real estate development, investment and asset management). | 89 | None | ||||||
Paula H.J. Cholmondeley c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1947 | Trustee since July 2000 | Ms. Cholmondeley was Vice President and General Manager of Sappi Fine Paper North America from April 2000 through December 2003. | 89 | Director of Dentsply International, Inc. (dental products), Ultralife Batteries, Inc., Terex Corporation (construction equipment), Minerals Technology, Inc. (specialty chemicals) and Albany International Corp. (paper industry) | ||||||
C. Brent DeVore3 c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1940 | Trustee since 1990 | Dr. DeVore is President of Otterbein College. | 89 | None | ||||||
Phyllis Kay Dryden c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1947 | Trustee since December 2004 | Ms. Dryden was a partner of Mitchell Madison, a management consulting company from January 2006 until December 2006; she is currently a consultant with the company. Ms. Dryden was formerly Managing Partner of march FIRST, a global management consulting firm. | 89 | None | ||||||
Barbara L. Hennigar c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1935 | Trustee since July 2000 | Retired. | 89 | None | ||||||
Number of Portfolios | ||||||||||
Position(s) Held | in the | |||||||||
with the Trust | Principal Occupation(s) | Nationwide Fund | Other | |||||||
Name, Address | and Length of | During Past | Complex Overseen | Directorships | ||||||
and Year of Birth | Time Served1 | Five Years | by Trustee | Held by Trustee2 | ||||||
Barbara I. Jacobs c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1950 | Trustee since December 2004 | Ms. Jacobs served as Chairman of the Board of Directors of KICAP Network Fund, a European (United Kingdom) hedge fund, from January 2001 through January 2006. From 1998-2003, Ms. Jacobs was also a Managing Director and European Portfolio Manager of CREF Investments (Teachers Insurance and Annuity Association-College Retirement Equities Fund). | 89 | None | ||||||
Douglas F. Kridler c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1955 | Trustee since September 1997 | Mr. Kridler has served as the President and Chief Executive Officer of the Columbus Foundation (a Columbus, OH-based foundation which manages over 1,300 individual endowment funds) since February 2002. Prior to January 31, 2002, Mr. Kridler was the President of the Columbus Association for the Performing Arts and Chairman of the Greater Columbus Convention and Visitors Bureau. | 89 | None | ||||||
Michael D. McCarthy c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1947 | Trustee since December 2004 | Retired. Mr. McCarthy was Chairman of VMAC (commodity swaps) from October 2002 until January 2007; and a partner of Pineville Properties LLC (a commercial real estate development firm) from September 2000 until January 2007. | 89 | None | ||||||
David C. Wetmore c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1948 | Trustee since 1995 and Chairman since February 2005 | Retired. | 89 | None | ||||||
1 | Length of time served includes time served with the Trust’s predecessors. | |
2 | Directorships held in (1) any other investment companies registered under the 1940 Act, (2) any company with a class of securities registered pursuant to Section 12 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or (3) any company subject to the requirements of Section 15(d) of the Exchange Act. | |
3 | Mr. DeVore has served as President of Otterbein College since 1984. Mark Thresher, President and Chief Operating Officer of Nationwide Financial Services, Inc. (“NFS”) has served as a member of the Board of Trustees of Otterbein College since 2000, currently serves as one of 30 of its trustees, and is currently one of two Vice Chairmen of the Board. Each of Nationwide Fund Advisors (“NFA”), the Funds’ investment adviser, and Nationwide Fund Distributors LLC (“NFD”), principal underwriter to the Trust, is a wholly-owned subsidiary of NFS. | |
Additional information regarding the Trustees and Officers may be found in the Trust’s Statement of Additional Information, which is available without charge upon request, by calling 800-848-0920. |
Trustees who are Interested Persons (as defined in the 1940 Act) and/or Officers of the Trust as of
Number of Portfolios | ||||||||||
Position(s) Held | in the | |||||||||
with the Trust | Principal Occupation(s) | Nationwide Fund | Other | |||||||
Name, Address | and Length of | During Past | Complex Overseen | Directorships | ||||||
and Year of Birth | Time Served1 | 5 Years | by Trustee | Held by Trustee 2 | ||||||
Arden L. Shisler c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1941 | Trustee since February 2000 | Retired. Mr. Shisler is the former President and Chief Executive Officer of KeB Transport, Inc., a trucking firm (2000 through 2002). He served as a consultant to KeB from January 2003 through December 2004. Since 1992, Mr. Shisler has also been Chairman of the Board for Nationwide Mutual Insurance Company.3 | 89 | Director of Nationwide Financial Services, Inc., Chairman of Nationwide Mutual Insurance Company3 | ||||||
John H. Grady Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1961 | President & Chief Executive Officer since December 2006 | Mr. Grady is President, and Chief Executive Officer of Nationwide Funds Group which includes Nationwide Fund Advisors,3 Nationwide Fund Management LLC,3 Nationwide Fund Distributors LLC 3 and NWD Investments,2 the asset management operations of Nationwide Mutual Insurance Company, which includes Morley Capital Management, Inc.,2 Nationwide Separate Accounts LLC,2 NorthPointe Capital LLC,2 and Nationwide SA Capital Trust2. From March 2004 until March 2006, Mr. Grady was Chief Executive Officer of Constellation Investment Management Co., L.P. (registered investment adviser), and President and Chief Executive Officer of Constellation Funds Group (registered investment companies). He also was President of Constellation Investment Distribution Co., Inc. (registered broker-dealer) from March 2004 until June 2006. From February 2001 until February 2004, Mr. Grady was Chief Operating and Chief Legal Officer; Managing Director, Mutual Funds Group, Turner Investment Partners, Inc. (registered investment adviser); Executive Vice President of Turner Funds and Turner Institutional Portfolios (registered investment companies); and President, Turner Investment Distributors, Inc. (registered broker-dealer). | N/A | None | ||||||
Gerald J. Holland Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1951 | Treasurer since March 2001 | Mr. Holland is Senior Vice President—Operations for Nationwide Funds Group3. | N/A | N/A | ||||||
Number of Portfolios | ||||||||||
Position(s) Held | in the | |||||||||
with the Trust | Principal Occupation(s) | Nationwide Fund | Other | |||||||
Name, Address | and Length of | During Past | Complex Overseen | Directorships | ||||||
and Year of Birth | Time Served1 | 5 Years | by Trustee | Held by Trustee 2 | ||||||
Michael A. Krulikowski Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1959 | Chief Compliance Officer from June 2004 to August 20074 | Mr. Krulikowski is Vice President and Chief Compliance Officer of Nationwide Funds Group3, Morley Capital Management, Inc.3, Nationwide SA Capital Trust (since 1999)3, and Nationwide Separate Accounts LLC (since August 2005).3 Since June 2004, Mr. Krulikowski has also served as Chief Compliance Officer of the Trust. From November 1999 through May 2007, he served as Vice President and Chief Compliance Officer of NorthPointe Capital LLC. 3 | N/A | N/A | ||||||
Eric E. Miller Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1953 | Secretary since December 2002 | Mr. Miller is Senior Vice President, General Counsel, and Assistant Secretary for Nationwide Funds Group3 and NWD Investments.2 From August 2000 to August 2002, Mr. Miller was a Partner with Stradley Ronon Stevens & Young, LLP. | N/A | N/A | ||||||
1 | Length of time served includes time served with the Trust’s predecessors. | |
2 | Directorships held in (1) any other investment companies registered under the 1940 Act, (2) any company with a class of securities registered pursuant to Section 12 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or (3) any company subject to the requirements of Section 15(d) of the Exchange Act. | |
3 | This position is held with an affiliated person or principal underwriter of the Trust. | |
4 | Effective August 3, 2007, the Board of Trustees approved Carol Baldwin Moody as Chief Compliance Officer of the Trust. Since November 2005, Ms. Moody has been Senior Vice President, Chief Compliance Officer of Nationwide Financial Services, Nationwide Life Insurance Company, Nationwide Life and Annuity Insurance Company, and Nationwide Investment Advisors, LLC. From February 2004-November 2005, she was Chief Compliance Officer of TIAA-CREF and from April 2000-February 2004, she was Managing Director and General Counsel, TCW/ Latin America Partners, LLC and Baeza & Co., LLC. | |
Federal law requires the Trust, each of its investment advisers and sub-advisers to adopt procedures for voting proxies (“Proxy Voting Guidelines”) and to provide a summary of those Proxy Voting Guidelines used to vote the securities held by the Funds. The Funds’ proxy voting policies and procedures are available without charge (i) upon request, by calling 800-848-0920, (ii) on the Funds’ website at www.nationwidefunds.com, or (iii) on the Securities and Exchange Commission’s website at www.sec.gov. |
A. Renewal of Investment Advisory Agreement
(i) | General Information Regarding the Board’s Review of Investment Advisory Agreements |
The Trust’s investment advisory agreements (each an “Advisory Agreement”) with its investment adviser and, as applicable, sub-advisers (together, the “Adviser”) must be approved for an initial term no greater than two years, and renewed at least annually thereafter, (i) by the vote of the Trustees or by a vote of the shareholders of each series or fund of the Trust (individually a “Fund” ), and (ii) by the vote of a majority of the Trustees who are not parties to the Advisory Agreement or “interested persons” of any party thereto (the “Independent Trustees”) cast in person at a meeting called for the purpose of voting on such approval.
The Board meets quarterly and takes into account throughout the year matters bearing on each Fund’s Advisory Agreement. The Board and its standing committees consider at each meeting factors that are relevant to the annual renewal of an Advisory Agreement, including the services and support provided to a Fund and its shareholders.
On December 6, 2006, the Independent Trustees first met in person with their independent legal counsel (“Independent Legal Counsel”) to consider information provided by the Adviser and others to assist the Trustees in considering whether to renew each Fund’s Advisory Agreement for a one year term beginning May 1, 2007. Immediately following such meeting of the Independent Trustees, all Trustees met in person with the Adviser, Trust counsel, Independent Legal Counsel and others to consider such matters, and give preliminary consideration to information bearing on continuation of each Advisory Agreement. The primary purpose of the December 6 and 7, 2006 meeting was to ensure that the Trustees had ample opportunity to consider matters they deemed relevant in considering the continuation of an Advisory Agreement, and to request any additional information they considered reasonably necessary to their deliberations.
In preparation for the December 6 and 7, 2006 meeting the Trustees were provided, at the request of the Trustees, with a wide range of information to assist in their deliberations, including (i) reports from Lipper Inc. describing a Fund’s (a) performance rankings (where “first quintile” denotes the best performance) (over multiple years ended September 30, 2006) compared with performance groups and performance universes created by Lipper (and in some cases, customized peer groups created by the Adviser) of similar or peer group funds, and (b) expense rankings (where “first quintile” denotes the lowest fees and expenses) comparing the Fund’s contractual advisory fee and total expenses with expense groups and expense universes created by Lipper of similar or peer group funds, (ii) information from the Adviser describing the Fund’s performance (over multiple years ended September 30, 2006) compared with its benchmark and Lipper categories, (iii) for Funds under “close review,” copies of letters from the Adviser to the portfolio manager of each such Fund, together with the portfolio manager’s written response describing the reasons for the Fund’s underperformance (iv) information from the Adviser describing performance for the months of October and November, 2006, and annual performance for the year ended November 30, 2006, (v) reports from the Adviser describing the Adviser’s profitability in providing services under an Advisory Agreement, together with an explanation of Adviser’s methodology in calculating its profitability, (vi) information from the Adviser describing any fees paid to the Adviser for managing similar, non-affiliated institutional accounts, including the range of fee levels for such accounts, and (vii) information from the Adviser describing ancillary benefits, in addition to fees for serving as investment adviser, derived by the Adviser as a result of being investment adviser for a Fund, including, where applicable, information on soft-dollar benefits and fees inuring to the Adviser’s affiliates for serving as the Trust’s administrator, fund accountant and transfer agent.
At the December 6 and 7, 2006 meeting, the Trustees reviewed, considered and discussed, among themselves and with the Adviser, Trust counsel and Independent Legal Counsel, among other things, the information described above, and: (i) the nature, extent and quality of services provided by the Adviser under each Advisory Agreement, (ii) the investment performance of each Fund and the Adviser, (iii) the costs of the services provided by the Adviser under the Advisory Agreement and the profits realized by the Adviser thereunder, (iv) the extent to which economies of scale may be present and, if so, whether they are being shared with a Fund’s shareholders, (v) comparisons of the Adviser’s fees under the Advisory Agreement with investment advisory fees paid by peer group funds to their investment advisers and paid by non-affiliated institutional clients to the Adviser for managing similar accounts, and (vi) any ancillary benefits inuring to the Adviser and its affiliates as a result of being investment adviser for the Trust. The Trustees also considered, where
As part of the December 6 and 7, 2006 Board meeting, the Independent Trustees developed a list of follow-up matters and questions and asked that Adviser respond to such matters and questions at the contract approval meeting of the Board of Trustees to be held on January 11, 2007.
At the January 11, 2007 meeting of the Board of Trustees of the Trust, the Board received and considered information provided by the Adviser in follow-up from the December 6 and 7, 2006 Board meeting and, after consulting among themselves, and with the Adviser, Trust counsel and Independent Legal Counsel, concluded unanimously to renew the Advisory Agreement for the reasons set forth in the following section. In determining whether to renew the Advisory Agreement for the Fund, the Board ultimately reached a determination, with the assistance of Trust counsel and Independent Legal Counsel, that the renewal of the Advisory Agreement and the compensation to be received by the Adviser under the Advisory Agreement is consistent with the Board’s fiduciary duty under applicable law.
(ii) | Board Conclusions Regarding the Fund’s Advisory Agreement |
The Board considered that the Fund had outperformed its benchmark, the Lehman High Yield 2% Cap Index, for the one-year period and noted that the Fund had changed its benchmark during the fourth quarter 2005. The Board also considered that the performance of the Fund’s Class I shares had ranked in the first quintile of its Lipper-constructed Performance Group over the one- and five-year periods, and the third quintile over the two-, three-, and four-year periods. The Board found that recent and longer-term performance had been very good. Based on its review, and giving particular weight to the nature and quality of the resources dedicated by the adviser and subadviser to maintain recent relative performance, the Board concluded that the nature, extent, and quality of the services provided to the Fund will benefit the Fund’s shareholders.
The Board also considered that the Fund’s contractual advisory fee and breakpoints placed the Fund in the third quintile of its Lipper-constructed Expense Group and the Fund’s total expenses placed the Fund in the second quintile. The Board found that the Fund’s contractual advisory fee compared with its peer group was slightly higher than the median of the peer group. Based on its review, the Board concluded that the Fund’s management fee and total expenses were fair and reasonable in light of the services that the Fund receives and the other factors considered.
The Board considered that the Fund’s adviser reported a pre-tax profit margin for investment management services during each of the twelve month-periods ended September 30, 2006 and 2005. The Board considered the costs of the services provided by and the profits realized by the Fund’s adviser in connection with the operation of the Fund and determined that the amount of profit is a fair entrepreneurial profit for the management of the Fund.
Based upon its evaluation of all of the conclusions noted above, and after considering all material factors with respect to the Fund, the Board ultimately concluded that the advisory fee structure is fair and reasonable, and that the Advisory Agreement (and, if applicable, Sub-Advisory Agreement) with respect to the Fund, should be renewed.
B. Approval of New Advisory Agreement
At its January 11, 2007 meeting, the Board also unanimously approved a new investment advisory agreement (the “New Agreement”) for the Fund with Nationwide Fund Advisors, (“NFA”) the then-current adviser to each of the series of the Trust to become effective upon the closing of the acquisition of NFA by Nationwide Financial Services, Inc. (“NFS”) from Nationwide Corporation (“NWC”) which closed on April 30, 2007 (the “Transaction”). In approving the New Agreement, the Board considered NFA’s capacity to continue to provide the services needed to operate a sophisticated investment management business and to support the management of each of the series. The Board also took into account the information provided to them at their regular quarterly meetings with NFA’s senior management with respect to the Fund, including the information provided by management at the Fund’s annual Section 15(c) meetings on
C. Submission of Matters to a Vote of Security Holders:
On April 25, 2007, a Special Meeting of Shareholders was held* (the “April 25 Meeting”) at which shareholders of the Funds** set forth below were asked:
Proposal 1:
To approve a new investment advisory agreement, on behalf of their Fund, between Nationwide Fund Advisors (formerly “Gartmore Mutual Fund Capital Trust”) (the “Adviser”) and Nationwide Variable Insurance Trust (formerly “Gartmore Variable Insurance Trust”) (the “Trust”).
Number of Shares | ||||||||||
Fund | Cast/Not Cast | Percentages | ||||||||
Federated NVIT High Income Bond Fund | FOR | 30,051,703.188 shares | 92.514% | |||||||
(Formerly Federated GVIT | AGAINST | 618,245.021 shares | 1.903% | |||||||
High Income Bond Fund) | ABSTAIN | 1,813,550.431 shares | 5.583% | |||||||
TOTAL | 32,483,498.640 shares | |||||||||
NVIT International Index Fund | FOR | 4,322,203.982 shares | 96.897% | |||||||
(Formerly GVIT International | AGAINST | 2,758.318 shares | 0.062% | |||||||
Index Fund) | ABSTAIN | 135,636.840 shares | 3.041% | |||||||
TOTAL | 4,460,599.140 shares | |||||||||
NVIT International Value Fund | FOR | 20,032,843.199 shares | 93.351% | |||||||
(Formerly GVIT International | AGAINST | 333,588.902 shares | 1.554% | |||||||
Value Fund) | ABSTAIN | 1,093,293.879 shares | 5.095% | |||||||
TOTAL | 21,459,725.980 shares | |||||||||
NVIT Mid Cap Index Fund | FOR | 35,380,179.120 shares | 94.154% | |||||||
(Formerly GVIT Mid Cap Index Fund) | AGAINST | 631,117.844 shares | 1.679% | |||||||
ABSTAIN | 1,565,714.306 shares | 4.167% | ||||||||
TOTAL | 37,577,011.270 shares | |||||||||
NVIT S&P 500 Index Fund | FOR | 56,119,814.230 shares | 95.554% | |||||||
(Formerly GVIT S&P 500 Index Fund) | AGAINST | 666,195.542 shares | 1.134% | |||||||
ABSTAIN | 1,944,898.888 shares | 3.312% | ||||||||
TOTAL | 58,730,908.660 shares |
Number of Shares | ||||||||||
Fund | Cast/Not Cast | Percentages | ||||||||
Nationwide Multi-Manager NVIT | FOR | 7,632,918.513 shares | 92.700% | |||||||
Small Cap Growth Fund | AGAINST | 149,458.111 shares | 1.816% | |||||||
(Formerly GVIT Small Cap | ABSTAIN | 451,583.036 shares | 5.484% | |||||||
Growth Fund) | TOTAL | 8,233,959.660 shares | ||||||||
Nationwide Multi-Manager NVIT | FOR | 48,649,396.525 shares | 92.816% | |||||||
Small Cap Value Fund | AGAINST | 979,183.753 shares | 1.868% | |||||||
(Formerly GVIT Small Cap | ABSTAIN | 2,786,133.102 shares | 5.316% | |||||||
Value Fund) | TOTAL | 52,414,713.380 shares | ||||||||
Nationwide Multi-Manager NVIT | FOR | 29,903,181.700 shares | 91.311% | |||||||
Small Company Fund | AGAINST | 838,774.923 shares | 2.561% | |||||||
(Formerly GVIT Small Company Fund) | ABSTAIN | 2,006,741.307 shares | 6.128% | |||||||
TOTAL | 32,748,697.930 shares | |||||||||
Gartmore NVIT Developing | FOR | 21,0177,889.443 shares | 91.460% | |||||||
Markets Fund | AGAINST | 424,272.958 shares | 1.841% | |||||||
(Formerly Gartmore GVIT | ABSTAIN | 1,543,850.729 shares | 6.699% | |||||||
Developing Markets Fund) | TOTAL | 23,046,013.130 shares | ||||||||
Gartmore NVIT Emerging | FOR | 17,050,534.593 shares | 92.371% | |||||||
Markets Fund | AGAINST | 526,574.722 shares | 2.853% | |||||||
(Formerly Gartmore GVIT | ABSTAIN | 881,608.905 shares | 4.776% | |||||||
Emerging Markets Fund) | TOTAL | 18,458,718.220 shares | ||||||||
Nationwide NVIT Global | FOR | 1,554,847.333 shares | 95.589% | |||||||
Financial Services Fund | AGAINST | 19,539.033 shares | 1.201% | |||||||
(Formerly Gartmore GVIT | ABSTAIN | 52,206.494 shares | 3.210% | |||||||
Global Financial Services Fund) | TOTAL | 1,626,592.860 shares | ||||||||
Nationwide NVIT Global Health | FOR | 4,722,963.678 shares | 92.815% | |||||||
Sciences Fund | AGAINST | 157,979.030 shares | 3.104% | |||||||
(Formerly Gartmore GVIT | ABSTAIN | 207,642.222 shares | 4.081% | |||||||
Global Health Sciences Fund) | TOTAL | 5,088,584.930 shares | ||||||||
Nationwide NVIT Global Technology | FOR | 8,585,472.039 shares | 93.551% | |||||||
and Communications Fund | AGAINST | 102,267.977 shares | 1.114% | |||||||
(Formerly Gartmore GVIT | ABSTAIN | 489,577.634 shares | 5.335% | |||||||
Global Technology and Communications Fund) | TOTAL | 9,177,317.650 shares | ||||||||
Gartmore NVIT Global | FOR | 4,123,270.549 shares | 91.923% | |||||||
Utilities Fund | AGAINST | 122,001.533 shares | 2.720% | |||||||
(Formerly Gartmore GVIT | ABSTAIN | 240,276.088 shares | 5.357% | |||||||
Global Utilities Fund) | TOTAL | 4,485,548.170 shares | ||||||||
Nationwide NVIT Government | FOR | 88,471,567.462 shares | 92.024% | |||||||
Bond Fund | AGAINST | 1,825,645.181 shares | 1.899% | |||||||
(Formerly Gartmore GVIT | ABSTAIN | 5,841,990.727 shares | 6.077% | |||||||
Government Bond Fund) | TOTAL | 96,139,203.370 shares | ||||||||
Nationwide NVIT Growth Fund | FOR | 14,931,435.904 shares | 89.942% | |||||||
(Formerly Gartmore GVIT | AGAINST | 409,826.402 shares | 2.469% | |||||||
Growth Fund) | ABSTAIN | 1,259,945.064 shares | 7.589% | |||||||
TOTAL | 16,601,207.370 shares |
Number of Shares | ||||||||||
Fund | Cast/Not Cast | Percentages | ||||||||
Gartmore NVIT International | FOR | 6,251,419.070 shares | 93.569% | |||||||
Growth Fund | AGAINST | 139,618.548 shares | 2.090% | |||||||
(Formerly Gartmore GVIT | ABSTAIN | 290,025.592 shares | 4.341% | |||||||
International Growth Fund) | TOTAL | 6,681,063.210 shares | ||||||||
Nationwide NVIT Investor | FOR | 49,489,224.549 shares | 90.688% | |||||||
Destinations Aggressive Fund | AGAINST | 1,385,396.474 shares | 2.539% | |||||||
(Formerly Gartmore GVIT | ABSTAIN | 3,696,272.337 shares | 6.773% | |||||||
Investor Destinations Aggressive Fund) | TOTAL | 54,570,893.360 shares | ||||||||
Nationwide NVIT Investor | FOR | 23,091,965.887 shares | 89.855% | |||||||
Destinations Conservative Fund | AGAINST | 314,935,884 shares | 1.225% | |||||||
(Formerly Gartmore GVIT | ABSTAIN | 2,292,355.179 shares | 8.920% | |||||||
Investor Destinations Conservative Fund) | TOTAL | 25,699,256.950 shares | ||||||||
Nationwide NVIT Investor | FOR | 188,902,093.059 shares | 90.696% | |||||||
Destinations Moderate Fund | AGAINST | 3,018,924.590 shares | 1.449% | |||||||
(Formerly Gartmore GVIT | ABSTAIN | 16,359,690.401 shares | 7.855% | |||||||
Investor Destinations Moderate Fund) | TOTAL | 208,280,708.050 shares | ||||||||
Nationwide NVIT Investor | FOR | 134,792,622.920 shares | 91.332% | |||||||
Destinations Moderately Aggressive Fund | AGAINST | 3,489,207.264 shares | 2.364% | |||||||
(Formerly Gartmore GVIT Investor Destinations | ABSTAIN | 9,304,197.656 shares | 6.304% | |||||||
Moderately Aggressive Fund) | TOTAL | 147,586,027.840 shares | ||||||||
Nationwide NVIT Investor | FOR | 49,627,123.216 shares | 91.918% | |||||||
Destinations Moderately Conservative Fund | AGAINST | 856,088.634 shares | 1.586% | |||||||
(Formerly Gartmore GVIT Investor Destinations | ABSTAIN | 3,507,215.650 shares | 6.496% | |||||||
Moderately Conservative Fund) | TOTAL | 53,990,427.500 shares | ||||||||
Nationwide NVIT Mid Cap | FOR | 10,879,584.971 shares | 91.043% | |||||||
Growth Fund | AGAINST | 352,594.958 shares | 2.950% | |||||||
(Formerly Gartmore GVIT Mid | ABSTAIN | 717,792.971 shares | 6.007% | |||||||
Cap Growth Fund) | TOTAL | 11,949,972.900 shares | ||||||||
Nationwide NVIT Money Market | FOR | 221,774,863.241 shares | 88.508% | |||||||
Fund II | AGAINST | 12,322,482.494 shares | 4.918% | |||||||
(Formerly Gartmore GVIT Money | ABSTAIN | 16,471,740.875 shares | 6.574% | |||||||
Market Fund II) | TOTAL | 250,569,086.610 shares | ||||||||
Nationwide NVIT Money Market | FOR | 1,578,331,008.328 shares | 91.585% | |||||||
Fund | AGAINST | 32,372,133.671 shares | 1.878% | |||||||
(Formerly Gartmore GVIT Money | ABSTAIN | 112,652,123.301 shares | 6.537% | |||||||
Market Fund) | TOTAL | 1,723,355,265.300 shares | ||||||||
NVIT Nationwide Fund | FOR | 125,423,274.735 shares | 91.581% | |||||||
(Formerly Gartmore GVIT | AGAINST | 2,767,979.467 shares | 2.021% | |||||||
Nationwide Fund) | ABSTAIN | 8,762,255.828 shares | 6.398% | |||||||
TOTAL | 136,953,510.030 shares | |||||||||
NVIT Nationwide Leaders Fund | FOR | 2,298,504.956 shares | 95.780% | |||||||
(Formerly Gartmore GVIT | AGAINST | 29,630.469 shares | 1.235% | |||||||
Nationwide Leaders Fund) | ABSTAIN | 71,637.755 shares | 2.985% | |||||||
TOTAL | 2,399,773.180 shares |
Number of Shares | ||||||||||
Fund | Cast/Not Cast | Percentages | ||||||||
Nationwide NVIT U.S. Growth | FOR | 4,972,094.773 shares | 94.359% | |||||||
Leaders Fund | AGAINST | 122,623.161 shares | 2.327% | |||||||
(Formerly Gartmore GVIT U.S. | ABSTAIN | 174,625.606 shares | 3.314% | |||||||
Growth Leaders Fund) | TOTAL | 5,269,343.540 shares | ||||||||
Gartmore NVIT Worldwide | FOR | 2,666,862.487 shares | 94.126% | |||||||
Leaders Fund | AGAINST | 47,702.491 shares | 1.684% | |||||||
(Formerly Gartmore GVIT | ABSTAIN | 118,719.882 shares | 4.190% | |||||||
Worldwide Leaders Fund) | TOTAL | 2,833,284.860 shares | ||||||||
J.P. Morgan NVIT Balanced Fund | FOR | 15,966,867.546 shares | 90.900% | |||||||
(Formerly J.P. Morgan GVIT | AGAINST | 259,004.324 shares | 1.475% | |||||||
Balanced Fund) | ABSTAIN | 1,339,385.200 shares | 7.625% | |||||||
TOTAL | 17,565,257.070 shares | |||||||||
Van Kampen NVIT Comstock | FOR | 27,737,008.009 shares | 92.259% | |||||||
Value Fund | AGAINST | 502,564.164 shares | 1.672% | |||||||
(Formerly Van Kampen GVIT | ABSTAIN | 1,824,670.107 shares | 6.069% | |||||||
Comstock Value Fund) | TOTAL | 30,064,242.280 shares | ||||||||
Van Kampen NVIT Multi Sector | FOR | 21,253,297.665 shares | 90.281% | |||||||
Bond Fund | AGAINST | 484,100.920 shares | 2.056% | |||||||
(Formerly Van Kampen GVIT | ABSTAIN | 1,803,963.645 shares | 7.663% | |||||||
Multi Sector Bond Fund) | TOTAL | 23,541,362.230 shares | ||||||||
At the April 25 Meeting, shareholders of the Nationwide NVIT Mid Cap Growth Fund were also asked to approve a new investment subadvisory agreement among the Adviser, the Trust and NorthPointe Capital LLC. The voting results with respect to that proposal are set forth below:
Proposal 2
Number of Shares | ||||||||||
Fund | Cast/Not Cast | Percentages | ||||||||
Nationwide NVIT Mid Cap Growth | FOR | 10,862,827.499 shares | 90.903% | |||||||
Fund | AGAINST | 414,574.660 shares | 3.469% | |||||||
(Formerly Gartmore GVIT Mid | ABSTAIN | 672,570.741 shares | 5.628% | |||||||
Cap Growth Fund) | TOTAL | 11,949,972.900 shares | ||||||||
* | This meeting was previously adjourned on April 23, 2007. | |
** | Fund names were changed effective May 1, 2007 to reflect “Nationwide”/ “NVIT” branding to coincide with the sale of Nationwide Fund Advisors, Inc. by Nationwide Corporation to its majority-owned subsidiary, Nationwide Financial Services, Inc. |
June 30, 2007 (Unaudited)
Contents | ||
6 | Statement of Investments | |
9 | Statement of Assets and Liabilities | |
11 | Statement of Operations | |
12 | Statements of Changes in Net Assets | |
14 | Financial Highlights | |
15 | Notes to Financial Statements |
Statement Regarding Availability of Proxy Voting Record.
SAR-MCG (8/07) | ![]() |
Dear Fellow Shareholder:
Since I last wrote to you, our mutual funds have enjoyed another period of solid performance, and the corporate realignment that was in progress is now finished.
On May 1, 2007, Nationwide Financial Services, Inc. (NFS), completed its acquisition of the Philadelphia-based retail mutual fund operations of NWD Investment Management, Inc. (formerly, “Gartmore Global Investments, Inc.”), from Nationwide Corporation, a subsidiary of Nationwide Mutual Insurance Company. Effective that date, the acquired entities were renamed Nationwide Funds Group (NFG), and the Gartmore Funds were renamed the Nationwide Funds to better align with the Nationwide® brand. Although the corporate ownership and fund names have changed, I can assure you that NFG intends to maintain as much continuity as possible with the Funds and key personnel.
Thank you, shareholders, for approving the new investment advisory agreement that was required due to the change in corporate ownership. The new agreement is identical in all material respects to the original agreement that it replaces, with the exception of the section pertaining to the vote by the shareholders of the NVIT Mid Cap Growth Fund to approve NorthPointe Capital®, LLC (NorthPointe) as sub-adviser to that particular Fund.
Market Overview: January 1-June 30, 2007
Share prices in general were buoyed in part by better-than-expected first-quarter 2007 earnings and a flurry of mergers and acquisitions, many of these spurred by readily available funding from private equity firms. In June, investors grew more cautious amid surging crude oil prices, a sudden spike in long-term interest rates, and the meltdown of two hedge funds that had exposure to the subprime mortgage market. Looking abroad, a weak U.S. dollar aided foreign stocks, as reflected in the 11.09% advance of the Morgan Stanley Capital International Europe, Australasia and Far East (MSCI EAFE®) Index. Emerging market performance was particularly robust.
The bond market struggled during the first half of 2007. While short-term interest rates remained stable, reflecting the Federal Reserve Board’s decision in June to leave the target federal funds rate at 5.25%, longer-term rates climbed during the first half of 2007, depressing bond prices and forcing the Lehman Brothers® U.S. Aggregate Index to settle for a modest 0.97% return.
We at NFG thank you for your understanding and cooperation throughout our recent transition period. We emerge from this period energized for the future, and we look forward to serving your investment needs for a long time to come.
Nationwide Funds Group
PAST PERFORMANCE IS NO GUARANTEE OF FUTURE RESULTS.
Nationwide Funds are advised by Nationwide Fund Advisors (NFA). NFA is a wholly-owned subsidiary of Nationwide Financial Services. Nationwide Financial Services is a wholly-owned subsidiary of Nationwide Corporation. All of the common stock of Nationwide Corporation is held by Nationwide Mutual (95.2%) and Nationwide Mutual Fire Insurance Company (4.8%), each of which is a mutual company owned by its policyholders.
Nationwide Funds Group (NFG) is the mutual fund arm of Nationwide Financial Services (NYSE: NFS). Based in Conshohocken, Pa., a suburb of Philadelphia, NFG is comprised of Nationwide Fund Advisors, Nationwide Fund Distributors, LLC, and Nationwide Fund Management, LLC. Together, these provide advisory, distribution, and administration services respectively to the Nationwide Funds, and manage more than $43.5 billion in assets as of June 30, 2007, of which more than $12 billion are in “fund of funds” designed to provide asset allocation across several types of investments and asset classes.
Lehman Brothers (LB) U.S. Aggregate Index: An unmanaged, market value-weighted index of investment-grade, fixed-rate debt issues (including government, corporate, asset-backed, and mortgage-backed securities with maturities of one year or more) that is generally representative of the bond market as a whole.
Morgan Stanley Capital International Europe, Australasia and Far East (MSCI EAFE®) Index: An unmanaged, free float-adjusted, market capitalization-weighted index that is designed to measure the performance of stocks in developed markets outside the United States and Canada.
Standard & Poor’s 500® (S&P 500) Index: An unmanaged, market capitalization-weighted index of 500 widely held stocks of large-cap U.S. companies that gives a broad look at how the stock prices of those companies have performed.
Views expressed within are those of Nationwide Funds Group as of the date noted, are subject to change at any time, and may not come to pass.
This report is for informational purposes only, and is not intended as an offer or recommendation with respect to the purchase or sale of any security, option, future, or other derivatives in such securities.
Investing in mutual funds involves risk, including possible loss of principal.
Investors should carefully consider a fund’s investment objectives, risks, fees, charges, and expenses before investing any money. To obtain this and other fund information, please call 800-848-0920 to request a prospectus, or download a prospectus at www.nationwidefunds.com. Please read the prospectus carefully before investing any money.
Nationwide Funds distributed by Nationwide Fund Distributors LLC (formerly Gartmore Distribution Services, Inc.), Member NASD. 1200 River Road, Suite 1000, Conshohocken, Pa. 19428.
As a shareholder of the Fund, you incur two types of costs: (1) transaction costs, including sales charges (loads) paid on purchase payments and redemption fees; and (2) ongoing costs, including investment advisory fees, administration fees, distribution fees and other Fund expenses. The examples below are 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. Per SEC requirements, the examples assume that you had a $1,000 investment in the Class at the beginning of the reporting period, January 1, 2007, and continued to hold your shares at the end of the reporting period, June 30, 2007.
Actual Expenses
Hypothetical Example for Comparison Purposes
Please note that the expenses shown in the table are meant to highlight your ongoing costs only and do not reflect any transaction costs, such as sales charges (loads) or redemption fees. Therefore, the second line for each Class in 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 transaction costs were included, your costs would have been higher. The examples also assume all dividends and distributions have been reinvested.
Schedule of Shareholder Expenses
Beginning | Ending | Expenses Paid | Annualized | |||||||||||||||||||
Nationwide NVIT Mid Cap Growth Fund | Account Value | Account Value | During | Expense Ratio* | ||||||||||||||||||
1/1/07 06/30/07 Period* | ||||||||||||||||||||||
Class I | Actual | $ | 1,000.00 | $ | 1,093.20 | $ | 4.98 | 0.96% | ||||||||||||||
Hypothetical | 1 | $ | 1,000.00 | $ | 1,020.04 | $ | 4.82 | 0.96% | ||||||||||||||
Class II | Actual | $ | 1,000.00 | $ | 1,091.70 | $ | 6.38 | 1.23% | ||||||||||||||
Hypothetical | 1 | $ | 1,000.00 | $ | 1,018.70 | $ | 6.18 | 1.23% | ||||||||||||||
Class III | Actual | $ | 1,000.00 | $ | 1,093.00 | $ | 5.03 | 0.97% | ||||||||||||||
Hypothetical | 1 | $ | 1,000.00 | $ | 1,019.99 | $ | 4.87 | 0.97% | ||||||||||||||
Class IV | Actual | $ | 1,000.00 | $ | 1,093.40 | $ | 4.98 | 0.96% | ||||||||||||||
Hypothetical | 1 | $ | 1,000.00 | $ | 1,020.04 | $ | 4.82 | 0.96% | ||||||||||||||
* | Expenses are equal to the Fund’s annualized expense ratio multiplied by the average account value over the period multiplied by 181/365 (to reflect the one-half year period). The expense ratio presented represents a six-month, annualized ratio in accordance with SEC guidelines. The expenses reported above do not include the effect of additional expenses imposed by variable annuity contracts. |
Asset Allocation | ||||
Common Stock | 94.3% | |||
Repurchase Agreements | 5.0% | |||
Other Investments* | 26.9% | |||
Liabilities in excess of other assets** | -26.2% | |||
100.0% |
Top Holdings*** | ||||
Express Scripts, Inc. | 3.0% | |||
XTO Energy, Inc. | 2.3% | |||
Thermo Fisher Scientific, Inc. | 2.1% | |||
Ball Corp. | 2.0% | |||
NII Holdings, Inc. | 2.0% | |||
St. Jude Medical, Inc. | 2.0% | |||
Patterson Cos., Inc. | 1.7% | |||
Crocs, Inc. | 1.6% | |||
Ventana Medical Systems, Inc. | 1.5% | |||
Ecolab, Inc. | 1.5% | |||
Other | 80.3% | |||
100.0% |
Top Industries | ||||
Health Care Equipment & Supplies | 7.1% | |||
Oil, Gas & Consumable Fuels | 6.4% | |||
Specialty Retail | 6.2% | |||
Semiconductors & Semiconductor Equipment | 5.8% | |||
Health Care Providers & Services | 5.7% | |||
Diversified Financial Services | 5.4% | |||
IT Services | 4.2% | |||
Communications Equipment | 4.1% | |||
Machinery | 4.1% | |||
Textiles, Apparel & Luxury Goods | 3.8% | |||
Other | 47.2% | |||
100.0% |
* | Includes value of collateral received from securities lending. |
** | Includes value of collateral owed from securities lending. |
*** | For purpose of listing top holdings, repurchase agreements are included as part of Other. |
Nationwide NVIT Mid Cap Growth Fund
Common Stock (94.3%) | ||||||||
Shares or | ||||||||
Principal Amount | Value | |||||||
Air Freight & Logistics (0.4%) | ||||||||
Expeditors International of Washington, Inc. | 41,300 | $ | 1,705,690 | |||||
Auto Components (1.1%) (a) | ||||||||
Gentex Corp. | 240,400 | 4,733,476 | ||||||
Capital Markets (2.1%) | ||||||||
Affiliated Managers Group, Inc.* (a) | 36,900 | 4,751,244 | ||||||
TD Ameritrade Holding Corp.* | 218,300 | 4,366,000 | ||||||
9,117,244 | ||||||||
Chemicals (1.5%) | ||||||||
Ecolab, Inc. | 154,500 | 6,597,150 | ||||||
Commercial Services & Supplies (3.3%) | ||||||||
American Reprographics Co.* (a) | 158,300 | 4,874,057 | ||||||
Dun & Bradstreet Corp. | 43,700 | 4,500,226 | ||||||
Stericycle, Inc.* | 116,400 | 5,175,144 | ||||||
14,549,427 | ||||||||
Communications Equipment (4.1%) | ||||||||
Comverse Technology, Inc.* | 216,400 | 4,511,940 | ||||||
F5 Networks, Inc.* | 53,500 | 4,312,100 | ||||||
Foundry Networks, Inc.* | 271,200 | 4,518,192 | ||||||
NeuStar, Inc.* (a) | 166,000 | 4,809,020 | ||||||
18,151,252 | ||||||||
Computers & Peripherals (2.4%) | ||||||||
Logitech International S.A. ADR - CH* (a) | 159,300 | 4,203,927 | ||||||
Network Appliance, Inc.* | 212,500 | 6,205,000 | ||||||
10,408,927 | ||||||||
Construction & Engineering (1.2%) | ||||||||
Aecom Technology Corp.* | 219,910 | 5,455,967 | ||||||
Consumer Goods (1.3%) (a) | ||||||||
Jarden Corp.* | 130,150 | 5,597,752 | ||||||
Containers & Packaging (2.0%) | ||||||||
Ball Corp. | 165,800 | 8,815,586 | ||||||
Diversified Financial Services (5.4%) | ||||||||
Chicago Mercantile Exchange Holdings, Inc. | 9,900 | 5,290,164 | ||||||
GFI Group, Inc.* (a) | 86,000 | 6,233,280 | ||||||
Interactive Brokers Group, Inc., Class A* | 213,770 | 5,799,580 | ||||||
IntercontinentalExchange, Inc.* | 44,060 | 6,514,271 | ||||||
23,837,295 | ||||||||
Electronic Equipment & Instruments (1.3%) | ||||||||
CDW Corp.* | 67,000 | 5,692,990 | ||||||
Energy Equipment & Services (1.3%) (a) | ||||||||
TETRA Technologies, Inc.* | 205,900 | 5,806,380 | ||||||
Health Care Equipment & Supplies (7.1%) | ||||||||
Immucor, Inc.* (a) | 161,100 | 4,505,967 | ||||||
Intuitive Surgical, Inc.* (a) | 41,900 | 5,814,463 | ||||||
ResMed, Inc.* (a) | 132,600 | 5,471,076 | ||||||
St. Jude Medical, Inc.* | 205,200 | 8,513,748 | ||||||
Ventana Medical Systems, Inc.* (a) | 86,800 | 6,707,036 | ||||||
31,012,290 | ||||||||
Health Care Providers & Services (5.7%) | ||||||||
Express Scripts, Inc., Class A* | 262,100 | 13,107,621 | ||||||
Patterson Cos., Inc.* | 195,500 | 7,286,285 | ||||||
VCA Antech, Inc.* | 122,000 | 4,598,180 | ||||||
24,992,086 | ||||||||
Hotels, Restaurants & Leisure (1.1%) (a) | ||||||||
Penn National Casinos & Gambling, Inc.* | 77,100 | 4,632,939 | ||||||
Household Durables (0.7%) | ||||||||
Harman International Industries, Inc. | 25,600 | 2,990,080 | ||||||
Insurance (2.1%) | ||||||||
Brown & Brown, Inc. | 201,400 | 5,063,196 | ||||||
W.R. Berkley Corp. | 124,100 | 4,038,214 | ||||||
9,101,410 | ||||||||
Internet Software & Services (2.6%) | ||||||||
Akamai Technologies, Inc.* | 107,900 | 5,248,256 | ||||||
Dealertrack Holdings, Inc.* (a) | 174,000 | 6,410,160 | ||||||
11,658,416 | ||||||||
Common Stock (continued) | ||||||||
Shares or | ||||||||
Principal Amount | Value | |||||||
IT Services (4.2%) | ||||||||
Alliance Data Systems Corp.* | 52,100 | $ | 4,026,288 | |||||
Cognizant Technology Solutions Corp.* | 45,800 | 3,439,122 | ||||||
Fiserv, Inc.* | 100,300 | 5,697,040 | ||||||
VeriFone Holdings, Inc.* | 154,300 | 5,439,075 | ||||||
18,601,525 | ||||||||
Leisure Equipment & Products (0.5%) (a) | ||||||||
Pool Corp. | 55,200 | 2,154,456 | ||||||
Life Sciences Tools & Services (3.5%) | ||||||||
Thermo Fisher Scientific, Inc.* | 178,200 | 9,216,504 | ||||||
Waters Corp.* | 104,500 | 6,203,120 | ||||||
15,419,624 | ||||||||
Machinery (4.1%) | ||||||||
Actuant Corp. (a) | 99,000 | 6,242,940 | ||||||
Graco, Inc. | 42,200 | 1,699,816 | ||||||
Harsco Corp. | 94,300 | 4,903,600 | ||||||
Oshkosh Truck Corp. | 81,600 | 5,134,272 | ||||||
17,980,628 | ||||||||
Oil, Gas & Consumable Fuels (6.4%) | ||||||||
EOG Resources, Inc. | 76,900 | 5,618,314 | ||||||
Patterson-UTI Energy, Inc. | 243,900 | 6,392,619 | ||||||
World Fuel Services Corp. (a) | 141,000 | 5,930,460 | ||||||
XTO Energy, Inc. | 168,730 | 10,140,673 | ||||||
28,082,066 | ||||||||
Personal Products (1.1%) | ||||||||
Bare Escentuals, Inc.* | 146,400 | 4,999,560 | ||||||
Pharmaceuticals (1.4%) | ||||||||
Barr Pharmaceuticals, Inc.* | 122,800 | 6,168,244 | ||||||
Real Estate Management & Development (1.0%) | ||||||||
CB Richard Ellis Group, Inc., Class A* | 115,100 | 4,201,150 | ||||||
Road & Rail (1.1%) (a) | ||||||||
J.B. Hunt Transport Services, Inc. | 169,300 | 4,963,876 | ||||||
Semiconductors & Semiconductor Equipment (5.8%) | ||||||||
Altera Corp. | 231,700 | 5,127,521 | ||||||
Diodes, Inc.* (a) | 103,515 | 4,323,822 | ||||||
MEMC Electronic Materials, Inc.* | 78,400 | 4,791,808 | ||||||
Microchip Technology, Inc. | 171,800 | 6,363,472 | ||||||
Tessera Technologies, Inc.* | 120,101 | 4,870,095 | ||||||
25,476,718 | ||||||||
Software (2.4%) | ||||||||
Intuit, Inc.* | 182,600 | 5,492,608 | ||||||
MICROS Systems, Inc.* (a) | 90,000 | 4,896,000 | ||||||
10,388,608 | ||||||||
Specialty Retail (6.2%) | ||||||||
Abercrombie & Fitch Co. | 51,800 | 3,780,364 | ||||||
Coach, Inc.* | 134,200 | 6,359,738 | ||||||
Gamestop Corp.* | 126,900 | 4,961,790 | ||||||
J Crew Group, Inc.* (a) | 79,990 | 4,326,659 | ||||||
Office Depot, Inc.* | 203,100 | 6,153,930 | ||||||
Williams Sonoma, Inc. | 48,300 | 1,525,314 | ||||||
27,107,795 | ||||||||
Textiles, Apparel & Luxury Goods (3.8%) | ||||||||
Crocs, Inc.* | 166,400 | 7,160,192 | ||||||
Gildan Activewear, Inc. - CA* (a) | 121,800 | 4,176,522 | ||||||
Iconix Brand Group, Inc.* (a) | 250,000 | 5,555,000 | ||||||
16,891,714 | ||||||||
Trading Companies & Distributors (2.9%) | ||||||||
Beacon Roofing Supply, Inc.* (a) | 198,500 | 3,372,515 | ||||||
Fastenal Co. (a) | 116,200 | 4,864,132 | ||||||
MSC Industrial Direct Co., Class A | 80,500 | 4,427,500 | ||||||
12,664,147 | ||||||||
Wireless Telecommunication Services (3.2%) | ||||||||
Millicom International Cellular S.A. - LU* (a) | 58,200 | 5,333,448 | ||||||
NII Holdings, Inc.* | 108,800 | 8,784,512 | ||||||
14,117,960 | ||||||||
Total Common Stocks (Cost $348,747,296) | 414,074,428 | |||||||
Repurchase Agreements (5.0%) | ||||||||
Nomura Securities, 5.20%, dated 06/29/07, due 07/02/07, repurchase price $22,207,226, collateralized by various U.S. Government Agency Mortgages with a market value of $22,641,559 | $ | 22,197,607 | 22,197,607 | |||||
Nationwide NVIT Mid Cap Growth Fund (Continued)
Securities Held as Collateral for Securities on Loan (26.9%) | ||||||||
Shares or | ||||||||
Principal Amount | Value | |||||||
Securities Held as Collateral for Securities on Loan (26.9%) | ||||||||
Morgan Stanley Repurchase Agreement, 5.42%, dated 06/29/07, due 07/02/07, repurchase price $118,000,855, collateralized by U.S. Government Agency Mortgages with a market value of $120,342,754 | $ | 117,983,092 | $ | 117,983,092 | ||||
Total Investments (Cost $488,927,995) (b) — 126.2% | 554,255,127 | |||||||
Liabilities in excess of other assets — (26.2)% | (115,123,251 | ) | ||||||
NET ASSETS — 100.0% | $ | 439,131,876 | ||||||
* | Denotes a non-income producing security. | |
(a) | All or a part of the security was on loan as of June 30, 2007. | |
(b) | See notes to financial statements for tax unrealized appreciation (depreciation) of securities. |
ADR | American Depository Receipt | |
CA | Canada | |
CH | Switzerland | |
LU | Luxembourg |
See accompanying notes to financial statements.
Nationwide | ||||||
NVIT Mid Cap | ||||||
Growth Fund | ||||||
Assets: | ||||||
Investments, at value (cost $348,747,296)* | $ | 414,074,428 | ||||
Repurchase agreements, at cost and value | 140,180,699 | |||||
Total Investments | 554,255,127 | |||||
Interest and dividends receivable | 162,296 | |||||
Receivable for capital shares issued | 655,870 | |||||
Receivable for investments sold | 10,999,880 | |||||
Prepaid expenses | 4,647 | |||||
Total Assets | 566,077,820 | |||||
Liabilities: | ||||||
Payable to custodian | 1,766,255 | |||||
Payable for investments purchased | 6,609,011 | |||||
Payable upon return of securities loaned | 117,983,092 | |||||
Payable for capital shares redeemed | 168,968 | |||||
Accrued expenses and other payables: | ||||||
Investment advisory fees | 287,718 | |||||
Fund administration and transfer agent fees | 25,716 | |||||
Distribution fees | 43,196 | |||||
Administrative servicing fees | 37,707 | |||||
Compliance program costs | 4,570 | |||||
Other | 19,711 | |||||
Total Liabilities | 126,945,944 | |||||
Net Assets | $ | 439,131,876 | ||||
Represented by: | ||||||
Capital | $ | 451,776,762 | ||||
Accumulated net investment loss | (971,700 | ) | ||||
Accumulated net realized losses from investment transactions | (77,000,318 | ) | ||||
Net unrealized appreciation on investments | 65,327,132 | |||||
Net Assets | $ | 439,131,876 | ||||
Net Assets: | ||||||
Class I Shares | $ | 124,650,570 | ||||
Class II Shares | 216,669,466 | |||||
Class III Shares | 1,416,812 | |||||
Class IV Shares | 96,395,028 | |||||
Total | $ | 439,131,876 | ||||
Shares outstanding (unlimited number of shares authorized): | ||||||
Class I Shares | 3,820,919 | |||||
Class II Shares | 6,689,629 | |||||
Class III Shares | 43,381 | |||||
Class IV Shares | 2,950,773 | |||||
Total | 13,504,702 | |||||
9
Nationwide | ||||
NVIT Mid Cap | ||||
Growth Fund | ||||
Net asset value and offering price per share (Net assets by class divided by shares outstanding by class, respectively.): | ||||
Class I Shares | $ | 32.62 | ||
Class II Shares | $ | 32.39 | ||
Class III Shares | $ | 32.66 | ||
Class IV Shares | $ | 32.67 | ||
* | Includes value of securities on loan of $115,825,975. |
10
Nationwide | |||||
NVIT Mid Cap | |||||
Growth Fund | |||||
INVESTMENT INCOME: | |||||
Interest income | $ | 366,906 | |||
Dividend income | 584,390 | ||||
Income from securities lending | 201,068 | ||||
Total Income | 1,152,364 | ||||
Expenses: | |||||
Investment advisory fees | 1,448,287 | ||||
Fund administration and transfer agent fees | 120,128 | ||||
Distribution fees Class II Shares | 216,920 | ||||
Administrative servicing fees Class I Shares | 83,841 | ||||
Administrative servicing fees Class II Shares | 135,952 | ||||
Administrative servicing fees Class III Shares | 996 | ||||
Administrative servicing fees Class IV Shares | 62,287 | ||||
Custodian fees | 4,591 | ||||
Trustee fees | 8,331 | ||||
Compliance program costs (Note 3) | 2,671 | ||||
Other | 41,658 | ||||
Total expenses before earnings credit | 2,125,662 | ||||
Earnings credit (Note 6) | (1,598 | ) | |||
Net Expenses | 2,124,064 | ||||
Net Investment Loss | (971,700 | ) | |||
REALIZED/ UNREALIZED GAINS (LOSSES) FROM INVESTMENTS: | |||||
Net realized gains on investment transactions | 20,002,224 | ||||
Net change in unrealized appreciation on investments | 15,472,939 | ||||
Net realized/unrealized gains (losses) on investments | 35,475,163 | ||||
CHANGE IN NET ASSETS RESULTING FROM OPERATIONS | $ | 34,503,463 | |||
11
Nationwide NVIT Mid Cap Growth Fund | |||||||||
Six Months Ended | Year Ended | ||||||||
June 30, 2007 | December 31, 2006 | ||||||||
(Unaudited) | |||||||||
FROM INVESTMENT ACTIVITIES: | |||||||||
Operations: | |||||||||
Net investment loss | $ | (971,700 | ) | $ | (203,311 | ) | |||
Net realized gains on investment transactions | 20,002,224 | 32,776,759 | |||||||
Net change in unrealized appreciation/depreciation on investments | 15,472,939 | (5,885,274 | ) | ||||||
Change in net assets resulting from operations | 34,503,463 | 26,688,174 | |||||||
Change in net assets from capital transactions | 60,858,385 | 59,514,054 | |||||||
Change in net assets | 95,361,848 | 86,202,228 | |||||||
Net Assets: | |||||||||
Beginning of period | 343,770,028 | 257,567,800 | |||||||
End of period | $ | 439,131,876 | $ | 343,770,028 | |||||
Accumulated net investment income (loss) at end of period | $ | (971,700 | ) | $ | – | ||||
CAPITAL TRANSACTIONS: | |||||||||
Class I Shares | |||||||||
Proceeds from shares issued | $ | 8,163,337 | $ | 21,477,197 | |||||
Cost of shares redeemed (a) | (18,852,949 | ) | (43,213,316 | ) | |||||
(10,689,612 | ) | (21,736,119 | ) | ||||||
Class II Shares | |||||||||
Proceeds from shares issued | 80,298,868 | 97,680,163 | |||||||
Cost of shares redeemed (a) | (3,928,322 | ) | (4,721,957 | ) | |||||
76,370,546 | 92,958,206 | ||||||||
Class III Shares | |||||||||
Proceeds from shares issued | 58,558 | 222,722 | |||||||
Cost of shares redeemed (a) | (89,814 | ) | (412,205 | ) | |||||
(31,256 | ) | (189,483 | ) | ||||||
Class IV Shares | |||||||||
Proceeds from shares issued | 1,805,801 | 3,926,625 | |||||||
Cost of shares redeemed (a) | (6,597,094 | ) | (15,445,175 | ) | |||||
(4,791,293 | ) | (11,518,550 | ) | ||||||
Change in net assets from capital transactions | $ | 60,858,385 | $ | 59,514,054 | |||||
12
Nationwide NVIT Mid Cap Growth Fund | |||||||||
Six Months Ended | Year Ended | ||||||||
June 30, 2007 | December 31, 2006 | ||||||||
(Unaudited) | |||||||||
SHARE TRANSACTIONS: | |||||||||
Class I Shares | |||||||||
Issued | 260,306 | 743,788 | |||||||
Redeemed | (597,667 | ) | (1,524,436 | ) | |||||
(337,361 | ) | (780,648 | ) | ||||||
Class II Shares | |||||||||
Issued | 2,584,294 | 3,410,340 | |||||||
Redeemed | (129,888 | ) | (166,524 | ) | |||||
2,454,406 | 3,243,816 | ||||||||
Class III Shares | |||||||||
Issued | 1,873 | 7,716 | |||||||
Redeemed | (2,845 | ) | (14,563 | ) | |||||
(972 | ) | (6,847 | ) | ||||||
Class IV Shares | |||||||||
Issued | 57,886 | 136,419 | |||||||
Redeemed | (209,390 | ) | (538,803 | ) | |||||
(151,504 | ) | (402,384 | ) | ||||||
Total change in shares | 1,964,569 | 2,053,937 | |||||||
(a) | Includes redemption fees, if any. |
13
Investment Activities | ||||||||||||||||
Net Realized | ||||||||||||||||
and | ||||||||||||||||
Net Asset | Net | Unrealized | Total | |||||||||||||
Value, | Investment | Gains | from | |||||||||||||
Beginning | Income | (Losses) on | Investment | |||||||||||||
of Period | (Loss) | Investments | Activities | |||||||||||||
Class I Shares | ||||||||||||||||
Period ended December 31, 2003 (e) | $ | 16.53 | $ | (0.07 | ) | $ | 4.99 | $ | 4.92 | |||||||
For the year ended December 31, 2004 | $ | 21.45 | $ | (0.11 | ) | $ | 3.40 | $ | 3.29 | |||||||
For the year ended December 31, 2005 | $ | 24.74 | $ | (0.13 | ) | $ | 2.54 | $ | 2.41 | |||||||
For the year ended December 31, 2006 | $ | 27.15 | $ | – | (h) | $ | 2.69 | $ | 2.69 | |||||||
For the six months ended June 30, 2007 (Unaudited) | $ | 29.84 | $ | (0.06 | ) | $ | 2.84 | $ | 2.78 | |||||||
Class II Shares | ||||||||||||||||
Period ended December 31, 2003 (e) | $ | 16.77 | $ | (0.03 | ) | $ | 4.69 | $ | 4.66 | |||||||
For the year ended December 31, 2004 | $ | 21.43 | $ | (0.09 | ) | $ | 3.35 | $ | 3.26 | |||||||
For the year ended December 31, 2005 | $ | 24.69 | $ | (0.11 | ) | $ | 2.48 | $ | 2.37 | |||||||
For the year ended December 31, 2006 | $ | 27.06 | $ | (0.06 | ) | $ | 2.67 | $ | 2.61 | |||||||
For the six months ended June 30, 2007 (Unaudited) | $ | 29.67 | $ | (0.08 | ) | $ | 2.80 | $ | 2.72 | |||||||
Class III Shares | ||||||||||||||||
Period ended December 31, 2003 (e) | $ | 16.53 | $ | (0.03 | ) | $ | 4.98 | $ | 4.95 | |||||||
For the year ended December 31, 2004 | $ | 21.48 | $ | (0.10 | ) | $ | 3.39 | $ | 3.29 | |||||||
For the year ended December 31, 2005 | $ | 24.77 | $ | (0.11 | ) | $ | 2.52 | $ | 2.41 | |||||||
For the year ended December 31, 2006 | $ | 27.18 | $ | – | (h) | $ | 2.70 | $ | 2.70 | |||||||
For the six months ended June 30, 2007 (Unaudited) | $ | 29.88 | $ | (0.06 | ) | $ | 2.84 | $ | 2.78 | |||||||
Class IV Shares | ||||||||||||||||
For the year ended December 31, 2002 | $ | 20.01 | $ | (0.11 | ) | $ | (4.35 | ) | $ | (4.46 | ) | |||||
For the year ended December 31, 2003 (f) | $ | 15.46 | $ | (0.10 | ) | $ | 6.10 | $ | 6.00 | |||||||
For the year ended December 31, 2004 | $ | 21.46 | $ | (0.11 | ) | $ | 3.40 | $ | 3.29 | |||||||
For the year ended December 31, 2005 | $ | 24.75 | $ | (0.11 | ) | $ | 2.54 | $ | 2.43 | |||||||
For the year ended December 31, 2006 | $ | 27.18 | $ | 0.01 | $ | 2.69 | $ | 2.70 | ||||||||
For the six months ended June 30, 2007 (Unaudited) | $ | 29.88 | $ | (0.06 | ) | $ | 2.85 | $ | 2.79 | |||||||
[Additional columns below]
[Continued from above table, first column(s) repeated]
Distributions | ||||||||||||||||
Net | Net Asset | |||||||||||||||
realized | Total | Value, End | Total | |||||||||||||
gains | Distributions | of Period | Return (a) | |||||||||||||
Class I Shares | ||||||||||||||||
Period ended December 31, 2003 (e) | $ | – | $ | – | $ | 21.45 | 29.76% | |||||||||
For the year ended December 31, 2004 | $ | – | $ | – | $ | 24.74 | 15.34% | |||||||||
For the year ended December 31, 2005 | $ | – | $ | – | $ | 27.15 | 9.74% | |||||||||
For the year ended December 31, 2006 | $ | – | $ | – | $ | 29.84 | 9.91% | |||||||||
For the six months ended June 30, 2007 (Unaudited) | $ | – | $ | – | $ | 32.62 | 9.32% | |||||||||
Class II Shares | ||||||||||||||||
Period ended December 31, 2003 (e) | $ | – | $ | – | $ | 21.43 | 27.79% | |||||||||
For the year ended December 31, 2004 | $ | – | $ | – | $ | 24.69 | 15.21% | |||||||||
For the year ended December 31, 2005 | $ | – | $ | – | $ | 27.06 | 9.60% | |||||||||
For the year ended December 31, 2006 | $ | – | $ | – | $ | 29.67 | 9.65% | |||||||||
For the six months ended June 30, 2007 (Unaudited) | $ | – | $ | – | $ | 32.39 | 9.17% | |||||||||
Class III Shares | ||||||||||||||||
Period ended December 31, 2003 (e) | $ | – | $ | – | $ | 21.48 | 29.95% | |||||||||
For the year ended December 31, 2004 | $ | – | $ | – | $ | 24.77 | 15.32% | |||||||||
For the year ended December 31, 2005 | $ | – | $ | – | $ | 27.18 | 9.73% | |||||||||
For the year ended December 31, 2006 | $ | – | $ | – | $ | 29.88 | 9.93% | |||||||||
For the six months ended June 30, 2007 (Unaudited) | $ | – | $ | – | $ | 32.66 | 9.30% | |||||||||
Class IV Shares | ||||||||||||||||
For the year ended December 31, 2002 | $ | (0.09 | ) | $ | (0.09 | ) | $ | 15.46 | (22.38% | ) | ||||||
For the year ended December 31, 2003 (f) | $ | – | $ | – | $ | 21.46 | 38.81% | |||||||||
For the year ended December 31, 2004 | $ | – | $ | – | $ | 24.75 | 15.33% | |||||||||
For the year ended December 31, 2005 | $ | – | $ | – | $ | 27.18 | 9.82% | |||||||||
For the year ended December 31, 2006 | $ | – | $ | – | $ | 29.88 | 9.93% | |||||||||
For the six months ended June 30, 2007 (Unaudited) | $ | – | $ | – | $ | 32.67 | 9.34% | |||||||||
[Additional columns below]
[Continued from above table, first column(s) repeated]
Ratios/Supplemental Data | ||||||||||||||||||||||||||
Ratio of | ||||||||||||||||||||||||||
Ratio of | Investment | |||||||||||||||||||||||||
Ratio of Net | Expenses | Income (Loss) | ||||||||||||||||||||||||
Net Assets | Ratio of | Investment | (Prior to | (Prior to | ||||||||||||||||||||||
at End of | Expenses to | Income (Loss) | Reimbursements) | Reimbursements) | ||||||||||||||||||||||
Period | Average Net | to Average | to Average | to Average | Portfolio | |||||||||||||||||||||
(000s) | Assets (b) | Net Assets (b) | Net Assets (b)(c) | Net Assets (b)(c) | Turnover (d) | |||||||||||||||||||||
Class I Shares | ||||||||||||||||||||||||||
Period ended December 31, 2003 (e) | $ | 137,837 | 0.98% | (0.49% | ) | (g) | (g) | 109.73% | ||||||||||||||||||
For the year ended December 31, 2004 | $ | 149,324 | 0.98% | (0.51% | ) | (g) | (g) | 90.14% | ||||||||||||||||||
For the year ended December 31, 2005 | $ | 134,094 | 1.01% | (0.48% | ) | (g) | (g) | 56.01% | ||||||||||||||||||
For the year ended December 31, 2006 | $ | 124,091 | 0.98% | 0.00% | (g) | (g) | 65.88% | |||||||||||||||||||
For the six months ended June 30, 2007 (Unaudited) | $ | 124,651 | 0.96% | (0.37% | ) | 0.96% | (0.37% | ) | 44.21% | |||||||||||||||||
Class II Shares | ||||||||||||||||||||||||||
Period ended December 31, 2003 (e) | $ | 2,388 | 1.17% | (0.64% | ) | (g) | (g) | 109.73% | ||||||||||||||||||
For the year ended December 31, 2004 | $ | 14,256 | 1.08% | (0.61% | ) | (g) | (g) | 90.14% | ||||||||||||||||||
For the year ended December 31, 2005 | $ | 26,825 | 1.16% | (0.63% | ) | (g) | (g) | 56.01% | ||||||||||||||||||
For the year ended December 31, 2006 | $ | 125,647 | 1.23% | (0.37% | ) | (g) | (g) | 65.88% | ||||||||||||||||||
For the six months ended June 30, 2007 (Unaudited) | $ | 216,669 | 1.23% | (0.64% | ) | 1.23% | (0.64% | ) | 44.21% | |||||||||||||||||
Class III Shares | ||||||||||||||||||||||||||
Period ended December 31, 2003 (e) | $ | 628 | 0.98% | (0.48% | ) | (g) | (g) | 109.73% | ||||||||||||||||||
For the year ended December 31, 2004 | $ | 1,190 | 0.98% | (0.50% | ) | (g) | (g) | 90.14% | ||||||||||||||||||
For the year ended December 31, 2005 | $ | 1,392 | 1.01% | (0.48% | ) | (g) | (g) | 56.01% | ||||||||||||||||||
For the year ended December 31, 2006 | $ | 1,325 | 0.99% | (0.01% | ) | (g) | (g) | 65.88% | ||||||||||||||||||
For the six months ended June 30, 2007 (Unaudited) | $ | 1,417 | 0.97% | (0.38% | ) | 0.97% | (0.38% | ) | 44.21% | |||||||||||||||||
Class IV Shares | ||||||||||||||||||||||||||
For the year ended December 31, 2002 | $ | 70,669 | 0.95% | (0.61% | ) | 1.00% | (0.66% | ) | 64.00% | |||||||||||||||||
For the year ended December 31, 2003 (f) | $ | 89,413 | 0.95% | (0.51% | ) | 1.02% | (0.58% | ) | 109.73% | |||||||||||||||||
For the year ended December 31, 2004 | $ | 95,854 | 0.95% | (0.48% | ) | 0.98% | (0.51% | ) | 90.14% | |||||||||||||||||
For the year ended December 31, 2005 | $ | 95,257 | 0.95% | (0.42% | ) | 1.01% | (0.48% | ) | 56.01% | |||||||||||||||||
For the year ended December 31, 2006 | $ | 92,707 | 0.95% | 0.03% | 0.98% | 0.02% | 65.88% | |||||||||||||||||||
For the six months ended June 30, 2007 (Unaudited) | $ | 96,395 | 0.95% | (0.38% | ) | 0.95% | (0.38% | ) | 44.21% | |||||||||||||||||
(a) | Not annualized for periods less than one year. | |
(b) | Annualized for periods less than one year. | |
(c) | During the period, certain fees were waived and/or reimbursed. If such waivers/reimbursements had not occurred, the ratios would have been as indicated. | |
(d) | Portfolio turnover is calculated on the basis of the Fund as a whole without distinguishing among the classes of shares. | |
(e) | For the period from April 28, 2003 (commencement of operations) through December 31, 2003. | |
(f) | The Nationwide Mid Cap Growth Fund retained the financial history of the Market Street Mid Cap Growth Fund and the existing shares of the Fund were designated Class IV shares. | |
(g) | There were no fee reductions during the period. | |
(h) | The amount is less than $0.005 per share. |
See accompanying notes to financial statements.
1. Organization
Nationwide Variable Insurance Trust (“NVIT” or the “Trust”) is an open-end management investment company, organized under the laws of Delaware by an amended and restated Agreement and Declaration of Trust, dated October 28, 2004, as amended to date. Prior to May 1, 2007, the Trust was named “Gartmore Variable Insurance Trust”. The Trust, originally created under the laws of Massachusetts as a Massachusetts business trust pursuant to a Declaration of Trust dated, as of June 30, 1981, and as subsequently amended, redomesticated as a Delaware Statutory Trust after the close of trading on April 29, 2005, and is registered under the Investment Company Act of 1940, as amended (the “1940 Act”). The redomestication was a change in statutory status and did not affect the operations of the Trust. As of June 30, 2007, the Trust had authorized an unlimited number of shares of beneficial interest, without par value (“shares”). The Trust currently offers shares to life insurance company separate accounts to fund the benefits under variable life insurance or annuity policies. To date, only the separate accounts of Nationwide Life Insurance Company and Nationwide Life and Annuity Insurance Company (collectively, “Nationwide”) have purchased shares of the Nationwide NVIT Mid Cap Growth Fund (the “Fund”), (formerly the “Gartmore GVIT Mid Cap Growth Fund”). The Trust currently operates forty (40) separate series, or mutual funds, each with its own investment objectives and strategies. This report contains the financial statements and financial highlights of the Fund.
2. Summary of Significant Accounting Policies
The following is a summary of significant accounting policies followed by the Fund in the preparation of its financial statements. The policies are in conformity with accounting principles generally accepted in the United States of America (“GAAP”). The preparation of financial statements requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of income and expenses for the period. Actual results could differ from those estimates.
(a) | Security Valuation |
Securities for which market quotations are readily available are valued at current market value as of “Valuation Time.” Valuation Time is as of the close of regular trading on the New York Stock Exchange (usually 4 p.m. Eastern time). Equity securities are valued at the last quoted sale price or, if there is no sale price, the last quoted bid price provided by an independent pricing service approved by the Trust’s Board of Trustees (“Board of Trustees”). Securities traded on NASDAQ are valued at the NASDAQ official closing price. Prices are taken from the primary market or exchange in which each security trades. | |
Most securities listed on a foreign exchange are valued either at fair value (see description below) or at the last sale price at the close of the exchange on which the security is principally traded. Foreign securities, currencies, and other assets and liabilities denominated in foreign currencies are translated into U.S. dollars at the exchange rate of said currencies against the U.S. dollar, as of Valuation Time, as provided by an independent pricing service approved by the Board of Trustees. | |
Securities for which market quotations are not readily available, or for which an independent pricing service does not provide a value or provides a value that does not represent fair value in the judgment of the Fund’s investment adviser or designee, are valued at fair value under procedures approved by the Board of Trustees. The “Fair Value” of these securities is determined in good faith by taking into account relevant factors and surrounding circumstances. Methods utilized to obtain a “Fair Value” may include the following non-exclusive list of acceptable methods: (i) a multiple of earnings; (ii) the discount from market value of a similar, freely traded security; (iii) the yield-to-maturity for debt issues; or (iv) a consolidation of the methods. The Trust’s Valuation & Operations Committee considers a non-exclusive list of factors to arrive at the appropriate method of determining “Fair Value.” For example, fair value determinations are required for securities whose value is affected by a “significant” event that materially affects the value of a domestic or foreign security which occurs subsequent to the time of the close of the principal market on which such domestic or foreign security trades and before the Valuation Time (i.e., a “subsequent event”). Typically, |
this will involve events occurring after the close of a foreign market on which a security trades and before the next Valuation Time. | |
The Fund values foreign securities at fair value in the circumstances described below. Generally, trading in foreign securities markets is completed each day at various times prior to the Valuation Time. Due to the time differences between the closings of the relevant foreign securities exchanges and the Valuation Time for the Fund, the Fund will fair value its foreign investments when it is determined that the market quotations for the foreign investments either are not readily available or are unreliable and, therefore, do not represent fair value. When the fair value prices are utilized, these prices will attempt to reflect the impact of the U.S. financial markets’ perceptions and trading activities on the Fund’s foreign investments since the last closing prices of the foreign investments were calculated on their primary foreign securities markets or exchanges. For these purposes, the Board of Trustees has determined that movements in relevant indices or other appropriate market indicators, after the close of the foreign securities exchanges, may demonstrate that market quotations are unreliable, and may trigger fair value pricing for certain securities. Consequently, fair valuation of portfolio securities may occur on a daily basis. |
(b) | Repurchase Agreements |
The Fund may enter into repurchase agreements with an entity which is a member of the Federal Reserve System or which is a “primary dealer” (as designated by the Federal Reserve Bank of New York) in U.S. Government obligations. The repurchase price generally equals the price paid by the Fund plus interest negotiated on the basis of current short-term rates, which may be more or less than the rate on the underlying portfolio securities. The seller under a repurchase agreement is required to maintain the value of the collateral held pursuant to the agreement at a market value equal to or greater than the repurchase price (including accrued interest). Collateral subject to repurchase agreements is held by the Fund’s custodian or another qualified sub-custodian or in the Federal Reserve/ Treasury book-entry system. If the counterparty defaults and the fair value of the collateral declines, realization of the collateral by the Fund may be delayed or limited. The Fund may transfer uninvested cash balances into a pooled cash account. These balances are invested in one or more repurchase agreements, with the counterparty of Nomura Securities, which is fully collateralized by U.S. Government Agency Mortgages. |
(c) | Foreign Currency Transactions |
The accounting records of the Fund are maintained in U.S. dollars. Foreign currency amounts are translated into U.S. dollars at the current rate of exchange to determine the value of investments, assets and liabilities. The Fund may enter into foreign currency contracts in connection with purchases or sales of securities denominated in a foreign currency. Purchases and sales of securities, and income and expenses, are translated at the prevailing rate of exchange on the respective date of these transactions. The Fund does not isolate that portion of the results of operations resulting from changes in foreign exchange rates on investments from fluctuations arising from changes in market prices of securities held. These fluctuations are included with the net realized and unrealized gain or loss from investments and foreign currencies. |
(d) | Futures Contracts |
The Fund may invest in financial futures contracts (“futures contracts”) for the purpose of hedging its existing portfolio securities or securities that the Fund intends to purchase against fluctuations in value caused by changes in prevailing market interest rates or prices. Futures contracts may also be entered into for non-hedging purposes. | |
Upon entering into a futures contract, the Fund is required to pledge to the broker an amount of cash and/or other assets equal to a certain percentage of the contract amount (initial margin deposit). Subsequent payments, known as “variation margin,” are made each day, depending on the daily fluctuations in the fair value/market value of the underlying assets. A gain or loss equal to the daily variation margin is recognized on a daily basis. Futures contracts are valued daily at their last quoted sale price. |
A “sale” of a futures contract means the creation of a contractual obligation to deliver the securities or foreign currency called for by the contract at a fixed price at a specified time in the future. A “purchase” of a futures contract means the creation of a contractual obligation to acquire the securities or foreign currency at a fixed price at a specified time in the future. | |
Should market conditions change unexpectedly, the Fund may not achieve the anticipated benefits of the futures contracts and may realize a loss. The use of futures transactions for hedging purposes involves the risk of imperfect correlation in movements in the price of futures contracts, interest rates, and the value of the underlying hedged assets. |
(e) | Short Sales |
The Fund is authorized to engage in short-selling of portfolio securities which obligates the Fund to replace any security that the Fund has borrowed by purchasing the security at current market value sometime in the future. The Fund will incur a loss if the price of the security increases between the date of the short sale and the date on which the Fund replaces the borrowed security. The Fund generally will realize a gain if the price of the security declines between these dates. Until the Fund replaces the borrowed security, the Fund will maintain a segregated account with cash, U.S. Government securities and/or securities held long to sufficiently cover the Fund’s short position on a daily basis. Dividends declared on securities sold short are recorded as an expense on the ex-dividend date and paid to the counterparty on the dividend pay date. |
(f) | Written Options Contracts |
The Fund may write options contracts. A written option obligates the Fund to deliver (written call) or to receive (written put) a specified quantity of an underlying asset at the contract amount upon exercise by the holder of the option. When the Fund writes an option, an amount equal to the premium received by the Fund is recorded as a liability and is subsequently adjusted to the current fair value of the option written. Premiums received from writing options that expire unexercised are treated by the Fund on the expiration date as realized gains from investments. The difference between the premium and the amount paid on effecting a closing purchase transaction, as a realized loss. If a call option is exercised, the premium is added to the proceeds from the sale of the underlying security or currency in determining whether the Fund has realized a gain or loss. If a put option is exercised, the premium reduces the cost basis of the securities purchased by the Fund. Options traded on an exchange are valued at the last quoted sale price, or in the absence of a sale, the bid price provided by an independent pricing service approved by the Board of Trustees. Non-exchange traded options are valued using dealer supplied quotes. The Fund as a writer of an option bears the market risk of an unfavorable change in the price of the security underlying the written option. |
(g) | Security Transactions and Investment Income |
Security transactions are accounted for on the date the security is purchased or sold (“trade date”). Securities gains and losses are calculated on the identified cost basis. Interest income is recognized on the accrual basis and includes, where applicable, the amortization or accretion of premium or discount. Dividend income is recorded on the ex-dividend date. |
(h) | Securities Lending |
To generate additional income, the Fund may lend its portfolio securities, up to 33 1/3% of the Fund, to brokers, dealers and other financial institutions provided that (1) the borrower delivers cash or securities as collateral with respect to each new loan of U.S. securities, equal to at least 102% of the value of the portfolio securities loaned, and with respect to each new loan on non-U.S. securities, collateral of at least 105% of the value of the portfolio securities loaned; and (2) at all times thereafter shall require the borrower to mark-to-market the collateral on a daily basis so that the market value of such collateral does not fall below 100% of the value of securities loaned. The Fund receives payments from borrowers equivalent to the dividends and interest that would have been earned on securities loaned while simultaneously seeking to earn income on the investment of cash collateral. There may be risks of delay |
in recovery of the securities should the borrower of the securities fail financially. Loans will be made, however, only to borrowers deemed by the Fund’s investment adviser to be of good standing and creditworthy under guidelines established by the Board of Trustees and when, in judgment of the adviser, the consideration which can be earned currently from these securities loans justifies the attendant risks. Loans are subject to termination by the Fund or the borrower at any time, and, therefore, are not considered to be illiquid investments. JPMorgan Chase Bank serves as custodian for the securities lending program of the Fund. JPMorgan Chase Bank receives a fee based on the value of the collateral received from borrowers. | |
Information on the investment of cash collateral is shown in the Statement of Investments. | |
As of June 30, 2007, the Fund had securities with the following value on loan: |
Value of Loaned Securities | Value of Collateral | |||||
$115,825,975 | $ | 117,983,092 | ||||
(i) | Distributions to Shareholders |
The Fund’s dividends from net investment income, if any, are declared and paid quarterly. The Fund’s distributions from net realized capital gains, if any, are declared and distributed at least annually. | |
Dividends and distributions to shareholders are determined in accordance with federal income tax regulations, which may differ from GAAP. These “book/tax” differences are considered either permanent or temporary in nature. In accordance with the American Institute of Certified Public Accountants Statement of Position 93-2, permanent differences (i.e., reclassification of market discounts, foreign exchange gain/loss, paydowns, and distributions from real estate investment trusts) are reclassified within the capital accounts based on their nature for federal income tax purposes; temporary differences do not require reclassification. These reclassifications have no effect upon the net asset value of the Fund. To the extent distributions exceed current and accumulated earnings and profits for federal income tax purposes, these distributions are reported as distributions of paid-in-capital. |
(j) | Federal Income Taxes |
It is the policy of the Fund to qualify or to continue to qualify as a “regulated investment company” by complying with the provisions available to certain investment companies, as defined in Subchapter M of the U.S. Internal Revenue Code, and to make distributions of net investment income and net realized capital gains sufficient to relieve the Fund from all, or substantially all, federal income taxes. | |
As of June 30, 2007, the tax cost of securities and the breakdown of unrealized appreciation (depreciation) for the Fund was as follows: |
Net Unrealized | ||||||||||||||||||
Tax Cost of | Unrealized | Unrealized | Appreciation | |||||||||||||||
Securities | Appreciation | Depreciation | (Depreciation) | |||||||||||||||
$ | 488,958,776 | $ | 71,341,283 | $ | (6,044,932 | ) | $ | 65,296,351 | ||||||||||
(k) | Allocation of Expenses, Income, and Gains and Losses |
Expenses directly attributable to the Fund are charged to the Fund. Expenses not directly attributable to the Fund are allocated proportionately among various or all funds within the Trust. The method used by the Fund for allocating income, fund level expenses, and realized and unrealized gains or losses is based on the fair value of shares outstanding relative to net assets. Under this method, each class of shares participates based on the total net asset value of that class’s shares in proportion to the total net assets of the Fund. Expenses specific to a class (such as Rule 12b-1 and administrative services fees) are charged to that class. |
3. Transactions with Affiliates
Under the terms of the Trust’s Investment Advisory Agreement, Nationwide Fund Advisors (formerly, Gartmore Mutual Fund Capital Trust (“GMF”)) (“NFA” or the “Advisor”) manages the investment of the assets and supervises the daily business affairs of the Fund. NFA is a wholly-owned subsidiary of Nationwide Financial Services (“NFS”). In addition, NFA provides investment management evaluation services in initially selecting and monitoring, on an ongoing basis, the performance of the subadviser for the Fund. Effective May 1, 2007, North Pointe Capital, LLC (“North Pointe”), an affiliate of NFA, for the Fund. North Pointe manages the Fund’s investments and has responsibility for making all investment decisions for the Fund.
Under the terms of the Investment Advisory Agreement, the Fund pays NFA an investment advisory fee based on the Fund’s average daily net assets and the following schedule:
Fee Schedule | Fees | |||||
Up to $200 million | 0.75% | |||||
$200 million or more | 0.70% | |||||
From such fees, pursuant to the subadvisory agreement, NFA paid the subadviser $316,912 for the period ended June 30, 2007.
Effective May 1, 2007, NFA and the Fund have entered into a written contract (“Expense Limitation Agreement”) limiting operating expenses (excluding any taxes, interest, brokerage fees, short-sale dividend expenses, other expenses which are capitalized in accordance with generally accepted accounting principles and may exclude other non-routine expenses not incurred in the ordinary course of the Fund’s business) from exceeding 0.95% for Class IV Shares until at least May 1, 2008.
NFA may request and receive reimbursement from the Fund of the advisory fees waived and other expenses reimbursed by NFA, respectively, pursuant to the Expense Limitation Agreement at a later date not to exceed three years from the fiscal year in which the corresponding reimbursement to the Fund was made, depending on the fund (as described below), if the Fund has reached a sufficient asset size to permit reimbursement to be made without causing the total annual operating expense ratio of the Fund to exceed the limits set forth above. No reimbursement will be made unless: (i) the Fund’s assets exceed $100 million; (ii) the total annual expense ratio of the Class making such reimbursement is less than the limit set forth above; and (iii) the payment of such reimbursement is approved by the Board of Trustees on a quarterly basis. Except as provided for in the Expense Limitation Agreement, reimbursement of amounts previously waived or assumed by NFA is not permitted.
As of the six months ended June 30, 2007, the cumulative potential reimbursements for the Class IV shares of the Fund, based on reimbursements which expire within three years from the fiscal year in which the corresponding reimbursement to the Fund was made for expenses reimbursed by NFA would be:
Amount Fiscal Year 2004 | Amount Fiscal Year 2005 | Amount Fiscal Year 2006 | ||||||||||||
$ | 26,956 | $ | 54,418 | $ | 27,983 | |||||||||
Under the terms of a Fund Administration and Transfer Agency Agreement, Nationwide Fund Management, LLC (formerly, Gartmore Investor Services, Inc. (“GISI”)) (“NFM”), a wholly-owned subsidiary of NFS Distributors, Inc. (“NFSDI”), provides the Fund with various administrative and accounting services for the Fund (prior to May 1, 2007, this service was provided by Gartmore SA Capital Trust (“GSA”)), and serves as Transfer and Dividend Disbursing Agent for the Fund (prior to May 1, 2007, this service was provided by GISI, an indirect subsidiary of GSA.) The fees for the services provided under this Agreement are calculated based on the Trust’s average daily net assets according to the fee
Combined Fee Schedule* | ||||||
Up to $1 billion | 0.15% | |||||
$1 billion up to $3 billion | 0.10% | |||||
$3 billion up to $8 billion | 0.05% | |||||
$8 billion up to $10 billion | 0.04% | |||||
$10 billion up to $12 billion | 0.02% | |||||
$12 billion or more | 0.01% | |||||
* | The assets of the Nationwide NVIT Investor Destinations Aggressive Fund, the Nationwide NVIT Investor Destinations Moderately Aggressive Fund, the Nationwide NVIT Investor Destinations Moderate Fund, the Nationwide NVIT Investor Destinations Moderately Conservative Fund, and the Nationwide NVIT Investor Destinations Conservative Fund (collectively, the “Investor Destinations Funds”) are excluded from the Trust asset level amount in order to calculate this asset-based fee. The Investor Destinations Funds do not pay any part of this fee. |
NFA and NFM have entered into agreements with Citi Fund Services Ohio, Inc. (“Citi’), pursuant to which Citi provides sub-administration and sub-transfer agency services, respectively, to the Fund. Effective August 1, 2007, The BISYS Group Inc. was acquired by and became a wholly owned subsidiary of Citi.
Under the terms of a Distribution Plan under Rule 12b-1 of the 1940 Act, Nationwide Fund Distributors, LLC. (formerly, “Gartmore Distribution Services, Inc. (“GDSI”)) (“NFD” or “Distributor”), the Fund’s principal underwriter, is compensated by the Fund for expenses associated with the distribution of the Class II shares of the Fund. NFD is a wholly-owned subsidiary of NFSDI. These fees are based on average daily net assets of Class II shares of the Fund at an annual rate not to exceed 0.25%.
Under the terms of an Administrative Services Plan, the Fund may pay fees to servicing organizations, such as broker-dealers, including NFS, and financial institutions, which agree to provide administrative support services to the shareholders of certain classes. These services include, but are not limited, to the following: establishing and maintaining shareholder accounts; processing purchase and redemption transactions; arranging bank wires; performing shareholder sub-accounting; answering inquires regarding the Fund; and other such services. These fees are based on an annual rate of up to 0.25% of the average daily net assets of Class I, Class II, Class III shares of shares of the Fund 0.20% of Class IV shares of the Fund.
For the six months ended June 30, 2007, NFS received $296,403 in Administrative Services Fees from the Fund.
Under the terms of a letter agreement dated September 12, 2006, by and among NFA, the Audit Committee of the Trust and the Trust, the Trust has agreed to reimburse NFA certain costs related to the Fund’s portion of ongoing administration, monitoring and annual (audit) testing of the Trust’s Rule 38a-1 Compliance Program subject to the pre-approval of the Trust’s Audit Committee. For the six months ended June 30, 2007, the Fund’s portion of such costs amounted to $2,671.
4. Short-Term Trading Fees
The Fund reserves the right to assess a short-term trading fee on certain transactions out of Class III shares that a separate account makes on behalf of a variable insurance contract owner (the “contract owner”). A separate account that redeems Class III shares on behalf of a contract owner may be subject to a 1.00% short-term trading fee if the separate account held the Class III shares on behalf of the contract owner for 60 days or less, unless an exception applies as disclosed in the Fund’s prospectus. The short-term trading fee is paid directly to the Fund and is intended to offset the cost to the Fund of excess brokerage commissions and other costs associated with fluctuations in Fund asset levels and cash flow caused by
For the six months ended June 30, 2007, the Fund had no contributions to capital due to collection of redemption fees.
5. Investment Transactions
For the six months ended June 30, 2007, (excluding short-term securities) the Fund had purchases of $207,624,366 and sales of $168,164,997.
6. Bank Loans and Earnings Credit
The Trust has a credit agreement with JPMorgan Chase & Co., the Fund’s custodian bank, permitting the Trust to borrow up to $100,000,000. Borrowings under this arrangement bear interest at the Federal Funds rate plus 0.50%. The interest costs, if any, would be included in other fees in the Statement of Operations. No compensating balances were required under the terms of the line of credit. The line of credit is renewed annually, expiring on June 25, 2008, with a commitment fee of 0.07% per year on $100,000,000. There were no borrowings outstanding under this line of credit for the six months ended June 30, 2007.
The Trust’s custodian bank has agreed to reduce the bank’s fees (earnings credit) when the funds of the Trust maintain cash on deposit in non-interest-bearing custody and Demand Deposit Accounts. Earnings credits are shown as a reduction of total expenses on the Statement of Operations.
7. Portfolio Investment Risks
Risks Associated with Foreign Securities and Currencies. Investments in securities of foreign issuers carry certain risks not ordinarily associated with investments in securities of U.S. issuers. These risks include future political and economic developments, and the possible imposition of exchange controls or other foreign governmental laws and restrictions. In addition, with respect to certain countries, there is the possibility of expropriation of assets, confiscatory taxation, political or social instability, or diplomatic developments, which could adversely affect investments in those countries.
Certain countries also may impose substantial restrictions on investments in their capital markets by foreign entities, including restrictions on investments in issuers of industries deemed sensitive to relevant national interests. These factors may limit the investment opportunities available and result in a lack of liquidity and high price volatility with respect to securities of issuers from developing countries.
8. Indemnifications
Under the Trust’s organizational documents, certain of the Trust’s Officers and Trustees are indemnified against certain liabilities arising out of the performance of their duties to the Trust. In addition, the Trust has entered into Indemnification Agreements with the Trust’s trustees and certain officers covering similar liabilities. Trust Officers receive no compensation from the Trust for serving as the Trust’s Officers. In addition, in the normal course of business, the Trust enters into contracts with its vendors and others that provide for general indemnifications. The Trust’s maximum exposure under these arrangements is unknown, as this would involve future claims that may be made against the Trust. Based on experience, however, the Trust expects that risk of loss to be remote.
9. Recently Issued Accounting Pronouncements
On July 13, 2006, the Financial Accounting Standards Board (“FASB”) released FASB Interpretation No. 48, Accounting for Uncertainty in Income Taxes (“FIN 48”). FIN 48 provides guidance for how uncertain tax positions should be recognized, measured, presented and disclosed in the financial statements. FIN 48 requires the affirmative evaluation of tax positions taken or expected to be taken in the course of preparing the Fund’s tax returns to determine whether it is more-likely-than-not (i.e., greater than 50 percent) that each tax position will be sustained upon examination by a taxing authority based on the technical merits of the position. A tax position that meets the more-likely-than-not recognition
In September 2006, the FASB issued Statement on Financial Accounting Standards (“SFAS”) No. 157, “Fair Value Measurements.” This standard establishes a single authoritative definition of fair value, sets out a framework for measuring fair value and requires additional disclosures about fair value measurements. SFAS No. 157 applies to fair value measurements already required or permitted by existing standards. SFAS No. 157 is effective for financial statements issued for fiscal years beginning after November 15, 2007 and interim periods within those fiscal years. The changes to current accounting principles generally accepted in the United States of America from the application of this Statement relate to the definition of fair value, the methods used to measure fair value, and the expanded disclosures about fair value measurements. As of June 30, 2007, the Fund does not believe the adoption of SFAS No. 157 will impact the financial statement amounts; however, additional disclosures may be required about the inputs used to develop the measurements and the effect of certain of the measurements on changes in net assets for the period.
Trustees who are not Interested Persons (as defined in the 1940 Act) and Officers of the Trust as of
Number of Portfolios | ||||||||||
Position(s) Held | in the | |||||||||
with the Trust | Principal Occupation(s) | Nationwide Fund | Other | |||||||
Name, Address | and Length of | During Past | Complex Overseen | Directorships | ||||||
and Year of Birth | Time Served1 | Five Years | by Trustee | Held by Trustee2 | ||||||
Charles E. Allen c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1948 | Trustee since July 2000 | Mr. Allen is Chairman, Chief Executive Officer and President of Graimark Realty Advisors, Inc. (real estate development, investment and asset management). | 89 | None | ||||||
Paula H.J. Cholmondeley c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1947 | Trustee since July 2000 | Ms. Cholmondeley was Vice President and General Manager of Sappi Fine Paper North America from April 2000 through December 2003. | 89 | Director of Dentsply International, Inc. (dental products), Ultralife Batteries, Inc., Terex Corporation (construction equipment), Minerals Technology, Inc. (specialty chemicals) and Albany International Corp. (paper industry) | ||||||
C. Brent DeVore3 c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1940 | Trustee since 1990 | Dr. DeVore is President of Otterbein College. | 89 | None | ||||||
Phyllis Kay Dryden c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1947 | Trustee since December 2004 | Ms. Dryden was a partner of Mitchell Madison, a management consulting company from January 2006 until December 2006; she is currently a consultant with the company. Ms. Dryden was formerly Managing Partner of march FIRST, a global management consulting firm. | 89 | None | ||||||
Barbara L. Hennigar c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1935 | Trustee since July 2000 | Retired. | 89 | None | ||||||
Number of Portfolios | ||||||||||
Position(s) Held | in the | |||||||||
with the Trust | Principal Occupation(s) | Nationwide Fund | Other | |||||||
Name, Address | and Length of | During Past | Complex Overseen | Directorships | ||||||
and Year of Birth | Time Served1 | Five Years | by Trustee | Held by Trustee2 | ||||||
Barbara I. Jacobs c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1950 | Trustee since December 2004 | Ms. Jacobs served as Chairman of the Board of Directors of KICAP Network Fund, a European (United Kingdom) hedge fund, from January 2001 through January 2006. From 1998-2003, Ms. Jacobs was also a Managing Director and European Portfolio Manager of CREF Investments (Teachers Insurance and Annuity Association-College Retirement Equities Fund). | 89 | None | ||||||
Douglas F. Kridler c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1955 | Trustee since September 1997 | Mr. Kridler has served as the President and Chief Executive Officer of the Columbus Foundation (a Columbus, OH-based foundation which manages over 1,300 individual endowment funds) since February 2002. Prior to January 31, 2002, Mr. Kridler was the President of the Columbus Association for the Performing Arts and Chairman of the Greater Columbus Convention and Visitors Bureau. | 89 | None | ||||||
Michael D. McCarthy c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1947 | Trustee since December 2004 | Retired. Mr. McCarthy was Chairman of VMAC (commodity swaps) from October 2002 until January 2007; and a partner of Pineville Properties LLC (a commercial real estate development firm) from September 2000 until January 2007. | 89 | None | ||||||
David C. Wetmore c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1948 | Trustee since 1995 and Chairman since February 2005 | Retired. | 89 | None | ||||||
1 | Length of time served includes time served with the Trust’s predecessors. | |
2 | Directorships held in (1) any other investment companies registered under the 1940 Act, (2) any company with a class of securities registered pursuant to Section 12 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or (3) any company subject to the requirements of Section 15(d) of the Exchange Act. | |
3 | Mr. DeVore has served as President of Otterbein College since 1984. Mark Thresher, President and Chief Operating Officer of Nationwide Financial Services, Inc. (“NFS”) has served as a member of the Board of Trustees of Otterbein College since 2000, currently serves as one of 30 of its trustees, and is currently one of two Vice Chairmen of the Board. Each of Nationwide Fund Advisors (“NFA”), the Funds’ investment adviser, and Nationwide Fund Distributors LLC (“NFD”), principal underwriter to the Trust, is a wholly-owned subsidiary of NFS. | |
Additional information regarding the Trustees and Officers may be found in the Trust’s Statement of Additional Information, which is available without charge upon request, by calling 800-848-0920. |
Trustees who are Interested Persons (as defined in the 1940 Act) and/or Officers of the Trust as of
Number of Portfolios | ||||||||||
Position(s) Held | in the | |||||||||
with the Trust | Principal Occupation(s) | Nationwide Fund | Other | |||||||
Name, Address | and Length of | During Past | Complex Overseen | Directorships | ||||||
and Year of Birth | Time Served1 | 5 Years | by Trustee | Held by Trustee 2 | ||||||
Arden L. Shisler c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1941 | Trustee since February 2000 | Retired. Mr. Shisler is the former President and Chief Executive Officer of KeB Transport, Inc., a trucking firm (2000 through 2002). He served as a consultant to KeB from January 2003 through December 2004. Since 1992, Mr. Shisler has also been Chairman of the Board for Nationwide Mutual Insurance Company.3 | 89 | Director of Nationwide Financial Services, Inc., Chairman of Nationwide Mutual Insurance Company3 | ||||||
John H. Grady Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1961 | President & Chief Executive Officer since December 2006 | Mr. Grady is President, and Chief Executive Officer of Nationwide Funds Group which includes Nationwide Fund Advisors,3 Nationwide Fund Management LLC,3 Nationwide Fund Distributors LLC 3 and NWD Investments,2 the asset management operations of Nationwide Mutual Insurance Company, which includes Morley Capital Management, Inc.,2 Nationwide Separate Accounts LLC,2 NorthPointe Capital LLC,2 and Nationwide SA Capital Trust2. From March 2004 until March 2006, Mr. Grady was Chief Executive Officer of Constellation Investment Management Co., L.P. (registered investment adviser), and President and Chief Executive Officer of Constellation Funds Group (registered investment companies). He also was President of Constellation Investment Distribution Co., Inc. (registered broker-dealer) from March 2004 until June 2006. From February 2001 until February 2004, Mr. Grady was Chief Operating and Chief Legal Officer; Managing Director, Mutual Funds Group, Turner Investment Partners, Inc. (registered investment adviser); Executive Vice President of Turner Funds and Turner Institutional Portfolios (registered investment companies); and President, Turner Investment Distributors, Inc. (registered broker-dealer). | N/A | None | ||||||
Gerald J. Holland Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1951 | Treasurer since March 2001 | Mr. Holland is Senior Vice President—Operations for Nationwide Funds Group3. | N/A | N/A | ||||||
Number of Portfolios | ||||||||||
Position(s) Held | in the | |||||||||
with the Trust | Principal Occupation(s) | Nationwide Fund | Other | |||||||
Name, Address | and Length of | During Past | Complex Overseen | Directorships | ||||||
and Year of Birth | Time Served1 | 5 Years | by Trustee | Held by Trustee 2 | ||||||
Michael A. Krulikowski Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1959 | Chief Compliance Officer from June 2004 to August 20074 | Mr. Krulikowski is Vice President and Chief Compliance Officer of Nationwide Funds Group3, Morley Capital Management, Inc.3, Nationwide SA Capital Trust (since 1999)3, and Nationwide Separate Accounts LLC (since August 2005).3 Since June 2004, Mr. Krulikowski has also served as Chief Compliance Officer of the Trust. From November 1999 through May 2007, he served as Vice President and Chief Compliance Officer of NorthPointe Capital LLC. 3 | N/A | N/A | ||||||
Eric E. Miller Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1953 | Secretary since December 2002 | Mr. Miller is Senior Vice President, General Counsel, and Assistant Secretary for Nationwide Funds Group3 and NWD Investments.2 From August 2000 to August 2002, Mr. Miller was a Partner with Stradley Ronon Stevens & Young, LLP. | N/A | N/A | ||||||
1 | Length of time served includes time served with the Trust’s predecessors. | |
2 | Directorships held in (1) any other investment companies registered under the 1940 Act, (2) any company with a class of securities registered pursuant to Section 12 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or (3) any company subject to the requirements of Section 15(d) of the Exchange Act. | |
3 | This position is held with an affiliated person or principal underwriter of the Trust. | |
4 | Effective August 3, 2007, the Board of Trustees approved Carol Baldwin Moody as Chief Compliance Officer of the Trust. Since November 2005, Ms. Moody has been Senior Vice President, Chief Compliance Officer of Nationwide Financial Services, Nationwide Life Insurance Company, Nationwide Life and Annuity Insurance Company, and Nationwide Investment Advisors, LLC. From February 2004-November 2005, she was Chief Compliance Officer of TIAA-CREF and from April 2000-February 2004, she was Managing Director and General Counsel, TCW/ Latin America Partners, LLC and Baeza & Co., LLC. | |
Federal law requires the Trust, each of its investment advisers and sub-advisers to adopt procedures for voting proxies (“Proxy Voting Guidelines”) and to provide a summary of those Proxy Voting Guidelines used to vote the securities held by the Funds. The Funds’ proxy voting policies and procedures are available without charge (i) upon request, by calling 800-848-0920, (ii) on the Funds’ website at www.nationwidefunds.com, or (iii) on the Securities and Exchange Commission’s website at www.sec.gov. |
A. Renewal of Investment Advisory Agreement
(i) | General Information Regarding the Board’s Review of Investment Advisory Agreements |
The Trust’s investment advisory agreements (each an “Advisory Agreement”) with its investment adviser and, as applicable, sub-advisers (together, the “Adviser”) must be approved for an initial term no greater than two years, and renewed at least annually thereafter, (i) by the vote of the Trustees or by a vote of the shareholders of each series or fund of the Trust (individually a “Fund” ), and (ii) by the vote of a majority of the Trustees who are not parties to the Advisory Agreement or “interested persons” of any party thereto (the “Independent Trustees”) cast in person at a meeting called for the purpose of voting on such approval.
The Board meets quarterly and takes into account throughout the year matters bearing on each Fund’s Advisory Agreement. The Board and its standing committees consider at each meeting factors that are relevant to the annual renewal of an Advisory Agreement, including the services and support provided to a Fund and its shareholders.
On December 6, 2006, the Independent Trustees first met in person with their independent legal counsel (“Independent Legal Counsel”) to consider information provided by the Adviser and others to assist the Trustees in considering whether to renew each Fund’s Advisory Agreement for a one year term beginning May 1, 2007. Immediately following such meeting of the Independent Trustees, all Trustees met in person with the Adviser, Trust counsel, Independent Legal Counsel and others to consider such matters, and give preliminary consideration to information bearing on continuation of each Advisory Agreement. The primary purpose of the December 6 and 7, 2006 meeting was to ensure that the Trustees had ample opportunity to consider matters they deemed relevant in considering the continuation of an Advisory Agreement, and to request any additional information they considered reasonably necessary to their deliberations.
In preparation for the December 6 and 7, 2006 meeting the Trustees were provided, at the request of the Trustees, with a wide range of information to assist in their deliberations, including (i) reports from Lipper Inc. describing a Fund’s (a) performance rankings (where “first quintile” denotes the best performance) (over multiple years ended September 30, 2006) compared with performance groups and performance universes created by Lipper (and in some cases, customized peer groups created by the Adviser) of similar or peer group funds, and (b) expense rankings (where “first quintile” denotes the lowest fees and expenses) comparing the Fund’s contractual advisory fee and total expenses with expense groups and expense universes created by Lipper of similar or peer group funds, (ii) information from the Adviser describing the Fund’s performance (over multiple years ended September 30, 2006) compared with its benchmark and Lipper categories, (iii) for Funds under “close review,” copies of letters from the Adviser to the portfolio manager of each such Fund, together with the portfolio manager’s written response describing the reasons for the Fund’s underperformance (iv) information from the Adviser describing performance for the months of October and November, 2006, and annual performance for the year ended November 30, 2006, (v) reports from the Adviser describing the Adviser’s profitability in providing services under an Advisory Agreement, together with an explanation of Adviser’s methodology in calculating its profitability, (vi) information from the Adviser describing any fees paid to the Adviser for managing similar, non-affiliated institutional accounts, including the range of fee levels for such accounts, and (vii) information from the Adviser describing ancillary benefits, in addition to fees for serving as investment adviser, derived by the Adviser as a result of being investment adviser for a Fund, including, where applicable, information on soft-dollar benefits and fees inuring to the Adviser’s affiliates for serving as the Trust’s administrator, fund accountant and transfer agent.
At the December 6 and 7, 2006 meeting, the Trustees reviewed, considered and discussed, among themselves and with the Adviser, Trust counsel and Independent Legal Counsel, among other things, the information described above, and: (i) the nature, extent and quality of services provided by the Adviser under each Advisory Agreement, (ii) the investment performance of each Fund and the Adviser, (iii) the costs of the services provided by the Adviser under the Advisory Agreement and the profits realized by the Adviser thereunder, (iv) the extent to which economies of scale may be present and, if so, whether they are being shared with a Fund’s shareholders, (v) comparisons of the Adviser’s fees under the Advisory Agreement with investment advisory fees paid by peer group funds to their investment advisers and paid by non-affiliated institutional clients to the Adviser for managing similar accounts, and (vi) any ancillary benefits inuring to the Adviser and its affiliates as a result of being investment adviser for the Trust. The Trustees also considered, where
As part of the December 6 and 7, 2006 Board meeting, the Independent Trustees developed a list of follow-up matters and questions and asked that Adviser respond to such matters and questions at the contract approval meeting of the Board of Trustees to be held on January 11, 2007.
At the January 11, 2007 meeting of the Board of Trustees of the Trust, the Board received and considered information provided by the Adviser in follow-up from the December 6 and 7, 2006 Board meeting and, after consulting among themselves, and with the Adviser, Trust counsel and Independent Legal Counsel, concluded unanimously to renew the Advisory Agreement for the reasons set forth in the following section. In determining whether to renew the Advisory Agreement for the Fund, the Board ultimately reached a determination, with the assistance of Trust counsel and Independent Legal Counsel, that the renewal of the Advisory Agreement and the compensation to be received by the Adviser under the Advisory Agreement is consistent with the Board’s fiduciary duty under applicable law.
(ii) | Board Conclusions Regarding the Fund’s Advisory Agreement |
The Board considered that the Fund had underperformed its benchmark, the Russell Mid-Cap Growth Index, for the one - and three-year periods and outperformed its benchmark for the five-year period. The Board also considered that performance of the Fund’s Class IV shares ranked in the first quintile over the one-, four- and five-year periods and ranked in the third quintile over the two- and three-year periods compared to that of its Lipper-constructed Performance Group. The Board found that the Fund’s performance has been good for the one-year period and longer-term, and satisfactory for the two- and three-year periods considered. Based on its review, and giving particular weight to the nature and quality of the resources dedicated by the Fund’s adviser to maintain relative performance, the Board concluded that the nature, extent and quality of services provided to the Fund will benefit the Fund’s shareholders.
The Board also considered that the Fund’s contractual advisory fee and breakpoints, and the Fund’s total expenses placed the Fund in the first quintile of its Lipper-constructed Expense Group. Based on its review, the Board concluded that the Fund’s management fee and total expenses were fair and reasonable in light of the services the Fund and its shareholders receive and the other factors considered.
The Board considered that the Fund’s adviser reported a pre-tax profit margin for investment management services for during the twelve month-periods ended September 30, 2006 and 2005. The Board also considered the costs of the services provided and the amounts of the profits realized by the adviser and determined the amount of profit is a fair entrepreneurial profit for management of the Fund.
Based upon its evaluation of all of the conclusions noted above, and after considering all material factors with respect to the Fund, the Board ultimately concluded that the advisory fee structure is fair and reasonable, and that the Advisory Agreement (and, if applicable, Sub-Advisory Agreement) with respect to the Fund, should be renewed.
B. Approval of New Advisory Agreement
At its January 11, 2007 meeting, the Board also unanimously approved a new investment advisory agreement (the “New Agreement”) for the Fund with Nationwide Fund Advisors, (“NFA”) the then-current adviser to each of the series of the Trust to become effective upon the closing of the acquisition of NFA by Nationwide Financial Services, Inc. (“NFS”) from Nationwide Corporation (“NWC”) which closed on April 30, 2007 (the “Transaction”). In approving the New Agreement, the Board considered NFA’s capacity to continue to provide the services needed to operate a sophisticated investment management business and to support the management of each of the series. The Board also took into account the information provided to them at their regular quarterly meetings with NFA’s senior management with respect to the Fund, including the information provided by management at the Fund’s annual Section 15(c) meetings on December 6-7, 2006 and January 11, 2007. In addition, the Board also considered NFS’ announced intentions, over
C. Approval of New Sub-Advisory Agreement
Additionally, the Board also approved at its January 11, 2007 meeting, a subadvisory agreement between the Trust, on behalf of the Fund, NFA and NorthPointe Capital LLC (“NorthPointe”) to take effect upon the closing of the Transaction (“New SubAdvisory Agreement”). The Board considered that the Fund was not previously subject to any subadvisory agreement and that the New Subadvisory Agreement provides for a different management structure. The Board unanimously approved the new management structure and determined that it was in the Fund’s best interest. The Board also considered that it was anticipated that under the New Subadvisory Agreement, day-to-day management of the Fund’s investments would continue to be provided by the same portfolio managers who managed the Fund prior to NorthPointe’s service as the subadviser. Specifically, it was anticipated that the Fund’s portfolio managers would be employees of NorthPointe rather than NFA. The Board approved submission of the New SubAdvisory Agreement to shareholders of record of the Fund as of February 2, 2007. Shareholders of the Fund have approved the New Agreement and New SubAdvisory Agreement and these became effective on April 30, 2007.
The Board also noted Nationwide Mutual’s stated intention to seek unaffiliated potential buyers for NorthPointe, in particular Nationwide Mutual’s goal to seek a buyer that will continue to employ the portfolio managers who would manage the Fund upon shareholder approval and to recommend to the Board, that if acquired by an unaffiliated adviser, then-unaffiliated NorthPointe be retained as an unaffiliated subadviser so that the Fund may continue to be managed by the same portfolio managers who are proposed to manage the Fund, without disruption of service. No assurances were given, however, that the foregoing would materialize. The Board further considered that, under the Manager of Managers Exemptive Order, NFA, with the Board’s approval, is permitted to hire (and fire) unaffiliated subadvisers, such as which NorthPointe would become if it were sold to an unaffiliated party, without seeking shareholder approval. Nationwide Mutual and NFA discussed with the Board that if NorthPointe is sold (and therefore becomes unaffiliated with NFA) and the Board were to approve a change to NorthPointe’s service as a subadviser to the Fund, shareholders of the Fund will receive notification of this within 90 days from the date of effectiveness of the change.
D. Submission of Matters to a Vote of Security Holders:
On April 25, 2007, a Special Meeting of Shareholders was held* (the “April 25 Meeting”) at which shareholders of the Funds** set forth below were asked:
Proposal 1:
To approve a new investment advisory agreement, on behalf of their Fund, between Nationwide Fund Advisors (formerly “Gartmore Mutual Fund Capital Trust”) (the “Adviser”) and Nationwide Variable Insurance Trust (formerly “Gartmore Variable Insurance Trust”) (the “Trust”).
Number of Shares | ||||||||||
Fund | Cast/Not Cast | Percentages | ||||||||
Federated NVIT High Income Bond Fund | FOR | 30,051,703.188 shares | 92.514% | |||||||
(Formerly Federated GVIT | AGAINST | 618,245.021 shares | 1.903% | |||||||
High Income Bond Fund) | ABSTAIN | 1,813,550.431 shares | 5.583% | |||||||
TOTAL | 32,483,498.640 shares | |||||||||
NVIT International Index Fund | FOR | 4,322,203.982 shares | 96.897% | |||||||
(Formerly GVIT | AGAINST | 2,758.318 shares | 0.062% | |||||||
International Index Fund) | ABSTAIN | 135,636.840 shares | 3.041% | |||||||
TOTAL | 4,460,599.140 shares | |||||||||
NVIT International Value Fund | FOR | 20,032,843.199 shares | 93.351% | |||||||
(Formerly GVIT | AGAINST | 333,588.902 shares | 1.554% | |||||||
International Value Fund) | ABSTAIN | 1,093,293.879 shares | 5.095% | |||||||
TOTAL | 21,459,725.980 shares | |||||||||
NVIT Mid Cap Index Fund | FOR | 35,380,179.120 shares | 94.154% | |||||||
(Formerly GVIT Mid Cap Index Fund) | AGAINST | 631,117.844 shares | 1.679% | |||||||
ABSTAIN | 1,565,714.306 shares | 4.167% | ||||||||
TOTAL | 37,577,011.270 shares | |||||||||
NVIT S&P 500 Index Fund | FOR | 56,119,814.230 shares | 95.554% | |||||||
(Formerly GVIT S&P 500 Index Fund) | AGAINST | 666,195.542 shares | 1.134% | |||||||
ABSTAIN | 1,944,898.888 shares | 3.312% | ||||||||
TOTAL | 58,730,908.660 shares | |||||||||
Nationwide Multi-Manager | FOR | 7,632,918.513 shares | 92.700% | |||||||
NVIT Small Cap Growth Fund | AGAINST | 149,458.111 shares | 1.816% | |||||||
(Formerly GVIT Small Cap Growth Fund) | ABSTAIN | 451,583.036 shares | 5.484% | |||||||
TOTAL | 8,233,959.660 shares | |||||||||
Nationwide Multi-Manager | FOR | 48,649,396.525 shares | 92.816% | |||||||
NVIT Small Cap Value Fund | AGAINST | 979,183.753 shares | 1.868% | |||||||
(Formerly GVIT Small Cap Value Fund) | ABSTAIN | 2,786,133.102 shares | 5.316% | |||||||
TOTAL | 52,414,713.380 shares | |||||||||
Nationwide Multi-Manager | FOR | 29,903,181.700 shares | 91.311% | |||||||
NVIT Small Company Fund | AGAINST | 838,774.923 shares | 2.561% | |||||||
(Formerly GVIT Small Company Fund) | ABSTAIN | 2,006,741.307 shares | 6.128% | |||||||
TOTAL | 32,748,697.930 shares | |||||||||
Gartmore NVIT Developing Markets Fund | FOR | 21,0177,889.443 shares | 91.460% | |||||||
(Formerly Gartmore GVIT | AGAINST | 424,272.958 shares | 1.841% | |||||||
Developing Markets Fund) | ABSTAIN | 1,543,850.729 shares | 6.699% | |||||||
TOTAL | 23,046,013.130 shares |
Number of Shares | ||||||||||
Fund | Cast/Not Cast | Percentages | ||||||||
Gartmore NVIT Emerging Markets Fund | FOR | 17,050,534.593 shares | 92.371% | |||||||
(Formerly Gartmore GVIT | AGAINST | 526,574.722 shares | 2.853% | |||||||
Emerging Markets Fund) | ABSTAIN | 881,608.905 shares | 4.776% | |||||||
TOTAL | 18,458,718.220 shares | |||||||||
Nationwide NVIT Global | FOR | 1,554,847.333 shares | 95.589% | |||||||
Financial Services Fund | AGAINST | 19,539.033 shares | 1.201% | |||||||
(Formerly Gartmore GVIT | ABSTAIN | 52,206.494 shares | 3.210% | |||||||
Global Financial Services Fund) | TOTAL | 1,626,592.860 shares | ||||||||
Nationwide NVIT Global | FOR | 4,722,963.678 shares | 92.815% | |||||||
Health Sciences Fund | AGAINST | 157,979.030 shares | 3.104% | |||||||
(Formerly Gartmore GVIT | ABSTAIN | 207,642.222 shares | 4.081% | |||||||
Global Health Sciences Fund) | TOTAL | 5,088,584.930 shares | ||||||||
Nationwide NVIT Global Technology and | FOR | 8,585,472.039 shares | 93.551% | |||||||
Communications Fund | AGAINST | 102,267.977 shares | 1.114% | |||||||
(Formerly Gartmore GVIT | ABSTAIN | 489,577.634 shares | 5.335% | |||||||
Global Technology and Communications Fund) | TOTAL | 9,177,317.650 shares | ||||||||
Gartmore NVIT Global | FOR | 4,123,270.549 shares | 91.923% | |||||||
Utilities Fund | AGAINST | 122,001.533 shares | 2.720% | |||||||
(Formerly Gartmore GVIT | ABSTAIN | 240,276.088 shares | 5.357% | |||||||
Global Utilities Fund) | TOTAL | 4,485,548.170 shares | ||||||||
Nationwide NVIT Government | FOR | 88,471,567.462 shares | 92.024% | |||||||
Bond Fund | AGAINST | 1,825,645.181 shares | 1.899% | |||||||
(Formerly Gartmore GVIT Government | ABSTAIN | 5,841,990.727 shares | 6.077% | |||||||
Bond Fund) | TOTAL | 96,139,203.370 shares | ||||||||
Nationwide NVIT Growth Fund | FOR | 14,931,435.904 shares | 89.942% | |||||||
(Formerly Gartmore GVIT | AGAINST | 409,826.402 shares | 2.469% | |||||||
Growth Fund) | ABSTAIN | 1,259,945.064 shares | 7.589% | |||||||
TOTAL | 16,601,207.370 shares | |||||||||
Gartmore NVIT International | FOR | 6,251,419.070 shares | 93.569% | |||||||
Growth Fund | AGAINST | 139,618.548 shares | 2.090% | |||||||
(Formerly Gartmore GVIT | ABSTAIN | 290,025.592 shares | 4.341% | |||||||
International Growth Fund) | TOTAL | 6,681,063.210 shares | ||||||||
Nationwide NVIT Investor | FOR | 49,489,224.549 shares | 90.688% | |||||||
Destinations Aggressive Fund | AGAINST | 1,385,396.474 shares | 2.539% | |||||||
(Formerly Gartmore GVIT Investor | ABSTAIN | 3,696,272.337 shares | 6.773% | |||||||
Destinations Aggressive Fund) | TOTAL | 54,570,893.360 shares | ||||||||
Nationwide NVIT Investor | FOR | 23,091,965.887 shares | 89.855% | |||||||
Destinations Conservative Fund | AGAINST | 314,935,884 shares | 1.225% | |||||||
(Formerly Gartmore GVIT | ABSTAIN | 2,292,355.179 shares | 8.920% | |||||||
Investor Destinations Conservative Fund) | TOTAL | 25,699,256.950 shares | ||||||||
Nationwide NVIT Investor | FOR | 188,902,093.059 shares | 90.696% | |||||||
Destinations Moderate Fund | AGAINST | 3,018,924.590 shares | 1.449% | |||||||
(Formerly Gartmore GVIT | ABSTAIN | 16,359,690.401 shares | 7.855% | |||||||
Investor Destinations Moderate Fund) | TOTAL | 208,280,708.050 shares |
Number of Shares | ||||||||||
Fund | Cast/Not Cast | Percentages | ||||||||
Nationwide NVIT Investor | FOR | 134,792,622.920 shares | 91.332% | |||||||
Destinations Moderately Aggressive Fund | AGAINST | 3,489,207.264 shares | 2.364% | |||||||
(Formerly Gartmore GVIT Investor Destinations | ABSTAIN | 9,304,197.656 shares | 6.304% | |||||||
Moderately Aggressive Fund) | TOTAL | 147,586,027.840 shares | ||||||||
Nationwide NVIT Investor | FOR | 49,627,123.216 shares | 91.918% | |||||||
Destinations Moderately Conservative Fund | AGAINST | 856,088.634 shares | 1.586% | |||||||
(Formerly Gartmore GVIT Investor Destinations | ABSTAIN | 3,507,215.650 shares | 6.496% | |||||||
Moderately Conservative Fund) | TOTAL | 53,990,427.500 shares | ||||||||
Nationwide NVIT Mid Cap Growth Fund | FOR | 10,879,584.971 shares | 91.043% | |||||||
(Formerly Gartmore GVIT | AGAINST | 352,594.958 shares | 2.950% | |||||||
Mid Cap Growth Fund) | ABSTAIN | 717,792.971 shares | 6.007% | |||||||
TOTAL | 11,949,972.900 shares | |||||||||
Nationwide NVIT Money Market Fund II | FOR | 221,774,863.241 shares | 88.508% | |||||||
(Formerly Gartmore GVIT | AGAINST | 12,322,482.494 shares | 4.918% | |||||||
Money Market Fund II) | ABSTAIN | 16,471,740.875 shares | 6.574% | |||||||
TOTAL | 250,569,086.610 shares | |||||||||
Nationwide NVIT Money Market Fund | FOR | 1,578,331,008.328 shares | 91.585% | |||||||
(Formerly Gartmore GVIT | AGAINST | 32,372,133.671 shares | 1.878% | |||||||
Money Market Fund) | ABSTAIN | 112,652,123.301 shares | 6.537% | |||||||
TOTAL | 1,723,355,265.300 shares | |||||||||
NVIT Nationwide Fund | FOR | 125,423,274.735 shares | 91.581% | |||||||
(Formerly Gartmore GVIT | AGAINST | 2,767,979.467 shares | 2.021% | |||||||
Nationwide Fund) | ABSTAIN | 8,762,255.828 shares | 6.398% | |||||||
TOTAL | 136,953,510.030 shares | |||||||||
NVIT Nationwide Leaders Fund | FOR | 2,298,504.956 shares | 95.780% | |||||||
(Formerly Gartmore GVIT | AGAINST | 29,630.469 shares | 1.235% | |||||||
Nationwide Leaders Fund) | ABSTAIN | 71,637.755 shares | 2.985% | |||||||
TOTAL | 2,399,773.180 shares | |||||||||
Nationwide NVIT U.S. Growth | FOR | 4,972,094.773 shares | 94.359% | |||||||
Leaders Fund | AGAINST | 122,623.161 shares | 2.327% | |||||||
(Formerly Gartmore GVIT | ABSTAIN | 174,625.606 shares | 3.314% | |||||||
U.S. Growth Leaders Fund) | TOTAL | 5,269,343.540 shares | ||||||||
Gartmore NVIT Worldwide | FOR | 2,666,862.487 shares | 94.126% | |||||||
Leaders Fund | AGAINST | 47,702.491 shares | 1.684% | |||||||
(Formerly Gartmore GVIT | ABSTAIN | 118,719.882 shares | 4.190% | |||||||
Worldwide Leaders Fund) | TOTAL | 2,833,284.860 shares | ||||||||
J.P. Morgan NVIT Balanced Fund | FOR | 15,966,867.546 shares | 90.900% | |||||||
(Formerly J.P. Morgan GVIT | AGAINST | 259,004.324 shares | 1.475% | |||||||
Balanced Fund) | ABSTAIN | 1,339,385.200 shares | 7.625% | |||||||
TOTAL | 17,565,257.070 shares | |||||||||
Van Kampen NVIT Comstock | FOR | 27,737,008.009 shares | 92.259% | |||||||
Value Fund | AGAINST | 502,564.164 shares | 1.672% | |||||||
(Formerly Van Kampen GVIT | ABSTAIN | 1,824,670.107 shares | 6.069% | |||||||
Comstock Value Fund) | TOTAL | 30,064,242.280 shares |
Number of Shares | ||||||||||
Fund | Cast/Not Cast | Percentages | ||||||||
Van Kampen NVIT Multi Sector | FOR | 21,253,297.665 shares | 90.281% | |||||||
Bond Fund | AGAINST | 484,100.920 shares | 2.056% | |||||||
(Formerly Van Kampen GVIT | ABSTAIN | 1,803,963.645 shares | 7.663% | |||||||
Multi Sector Bond Fund) | TOTAL | 23,541,362.230 shares | ||||||||
At the April 25 Meeting, shareholders of the Nationwide NVIT Mid Cap Growth Fund were also asked to approve a new investment subadvisory agreement among the Adviser, the Trust and NorthPointe Capital LLC. The voting results with respect to that proposal are set forth below:
Proposal 2
Number of Shares | ||||||||||
Fund | Cast/Not Cast | Percentages | ||||||||
Nationwide NVIT Mid Cap Growth Fund | FOR | 10,862,827.499 shares | 90.903% | |||||||
(Formerly Gartmore GVIT | AGAINST | 414,574.660 shares | 3.469% | |||||||
Mid Cap Growth Fund) | ABSTAIN | 672,570.741 shares | 5.628% | |||||||
TOTAL | 11,949,972.900 shares | |||||||||
* | This meeting was previously adjourned on April 23, 2007. | |
** | Fund names were changed effective May 1, 2007 to reflect “Nationwide”/“NVIT” branding to coincide with the sale of Nationwide Fund Advisors, Inc. by Nationwide Corporation to its majority-owned subsidiary, Nationwide Financial Services, Inc. |
June 30, 2007 (Unaudited)
Contents | ||
6 | Statement of Investments | |
14 | Statement of Assets and Liabilities | |
15 | Statement of Operations | |
16 | Statements of Changes in Net Assets | |
18 | Financial Highlights | |
19 | Notes to Financial Statements |
Statement Regarding Availability of Proxy Voting Record.
SAR-S&P (8/07) | ![]() |
Dear Fellow Shareholder:
Since I last wrote to you, our mutual funds have enjoyed another period of solid performance, and the corporate realignment that was in progress is now finished.
On May 1, 2007, Nationwide Financial Services, Inc. (NFS), completed its acquisition of the Philadelphia-based retail mutual fund operations of NWD Investment Management, Inc. (formerly, “Gartmore Global Investments, Inc.”), from Nationwide Corporation, a subsidiary of Nationwide Mutual Insurance Company. Effective that date, the acquired entities were renamed Nationwide Funds Group (NFG), and the Gartmore Funds were renamed the Nationwide Funds to better align with the Nationwide® brand. Although the corporate ownership and fund names have changed, I can assure you that NFG intends to maintain as much continuity as possible with the Funds and key personnel.
Thank you, shareholders, for approving the new investment advisory agreement that was required due to the change in corporate ownership. The new agreement is identical in all material respects to the original agreement that it replaces, with the exception of the section pertaining to the vote by the shareholders of the NVIT Mid Cap Growth Fund to approve NorthPointe Capital®, LLC (NorthPointe) as sub-adviser to that particular Fund.
Market Overview: January 1-June 30, 2007
Share prices in general were buoyed in part by better-than-expected first-quarter 2007 earnings and a flurry of mergers and acquisitions, many of these spurred by readily available funding from private equity firms. In June, investors grew more cautious amid surging crude oil prices, a sudden spike in long-term interest rates, and the meltdown of two hedge funds that had exposure to the subprime mortgage market. Looking abroad, a weak U.S. dollar aided foreign stocks, as reflected in the 11.09% advance of the Morgan Stanley Capital International Europe, Australasia and Far East (MSCI EAFE®) Index. Emerging market performance was particularly robust.
The bond market struggled during the first half of 2007. While short-term interest rates remained stable, reflecting the Federal Reserve Board’s decision in June to leave the target federal funds rate at 5.25%, longer-term rates climbed during the first half of 2007, depressing bond prices and forcing the Lehman Brothers® U.S. Aggregate Index to settle for a modest 0.97% return.
We at NFG thank you for your understanding and cooperation throughout our recent transition period. We emerge from this period energized for the future, and we look forward to serving your investment needs for a long time to come.
Nationwide Funds Group
PAST PERFORMANCE IS NO GUARANTEE OF FUTURE RESULTS.
Nationwide Funds are advised by Nationwide Fund Advisors (NFA). NFA is a wholly-owned subsidiary of Nationwide Financial Services. Nationwide Financial Services is a wholly-owned subsidiary of Nationwide Corporation. All of the common stock of Nationwide Corporation is held by Nationwide Mutual (95.2%) and Nationwide Mutual Fire Insurance Company (4.8%), each of which is a mutual company owned by its policyholders.
Nationwide Funds Group (NFG) is the mutual fund arm of Nationwide Financial Services (NYSE: NFS). Based in Conshohocken, Pa., a suburb of Philadelphia, NFG is comprised of Nationwide Fund Advisors, Nationwide Fund Distributors, LLC, and Nationwide Fund Management, LLC. Together, these provide advisory, distribution, and administration services respectively to the Nationwide Funds, and manage more than $43.5 billion in assets as of June 30, 2007, of which more than $12 billion are in “fund of funds” designed to provide asset allocation across several types of investments and asset classes.
Lehman Brothers (LB) U.S. Aggregate Index: An unmanaged, market value-weighted index of investment-grade, fixed-rate debt issues (including government, corporate, asset-backed, and mortgage-backed securities with maturities of one year or more) that is generally representative of the bond market as a whole.
Morgan Stanley Capital International Europe, Australasia and Far East (MSCI EAFE®) Index: An unmanaged, free float-adjusted, market capitalization-weighted index that is designed to measure the performance of stocks in developed markets outside the United States and Canada.
Standard & Poor’s 500® (S&P 500) Index: An unmanaged, market capitalization-weighted index of 500 widely held stocks of large-cap U.S. companies that gives a broad look at how the stock prices of those companies have performed.
Views expressed within are those of Nationwide Funds Group as of the date noted, are subject to change at any time, and may not come to pass.
This report is for informational purposes only, and is not intended as an offer or recommendation with respect to the purchase or sale of any security, option, future, or other derivatives in such securities.
Investing in mutual funds involves risk, including possible loss of principal.
Investors should carefully consider a fund’s investment objectives, risks, fees, charges, and expenses before investing any money. To obtain this and other fund information, please call 800-848-0920 to request a prospectus, or download a prospectus at www.nationwidefunds.com. Please read the prospectus carefully before investing any money.
Nationwide Funds distributed by Nationwide Fund Distributors LLC (formerly Gartmore Distribution Services, Inc.), Member NASD. 1200 River Road, Suite 1000, Conshohocken, Pa. 19428.
As a shareholder of the Fund, you incur two types of costs: (1) transaction costs, including sales charges (loads) paid on purchase payments and redemption fees; and (2) ongoing costs, including investment advisory fees, administration fees, distribution fees and other Fund expenses. The examples below are 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. Per SEC requirements, the examples assume that you had a $1,000 investment in the Class at the beginning of the reporting period, January 1, 2007, and continued to hold your shares at the end of the reporting period, June 30, 2007.
Actual Expenses
Hypothetical Example for Comparison Purposes
Please note that the expenses shown in the table are meant to highlight your ongoing costs only and do not reflect any transaction costs, such as sales charges (loads) or redemption fees. Therefore, the second line for each Class in 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 transaction costs were included, your costs would have been higher. The examples also assume all dividends and distributions have been reinvested.
Schedule of Shareholder Expenses
Beginning | Ending | |||||||||||||||||||||
Account Value | Account Value | Expenses Paid | Annualized | |||||||||||||||||||
NVIT S&P 500 Index Fund | 1/1/07 | 06/30/07 | During Period* | Expense Ratio* | ||||||||||||||||||
Class IV | Actual | $ | 1,000.00 | $ | 1,067.90 | $ | 1.64 | 0.32% | ||||||||||||||
Hypothetical | 1 | $ | 1,000.00 | $ | 1,023.21 | $ | 1.61 | 0.32% | ||||||||||||||
Class ID | Actual | $ | 1,000.00 | $ | 1,067.40 | $ | 1.18 | 0.23% | ||||||||||||||
Hypothetical | 1 | $ | 1,000.00 | $ | 1,023.66 | $ | 1.15 | 0.23% | ||||||||||||||
* | Expenses are equal to the Fund’s annualized expense ratio multiplied by the average account value over the period multiplied by 181/365 (to reflect the one-half year period). The expense ratio presented represents a six-month, annualized ratio in accordance with SEC guidelines. The expenses reported above do not include the effect of additional expenses imposed by variable annuity contracts. |
Asset Allocation | ||||
Common Stock | 95.2% | |||
Repurchase Agreements | 4.7% | |||
Other Investments* | 3.6% | |||
Liabilities in excess of other assets** | -3.5% | |||
100.0% |
Top Holdings*** | ||||
Exxon Mobil Corp. | 3.3% | |||
General Electric Co. | 2.8% | |||
AT&T, Inc. | 1.8% | |||
Citigroup, Inc. | 1.8% | |||
Microsoft Corp. | 1.8% | |||
Bank of America Corp. | 1.6% | |||
Procter & Gamble Co. (The) | 1.4% | |||
American International Group, Inc. | 1.3% | |||
ChevronTexaco Corp. | 1.3% | |||
Pfizer, Inc. | 1.3% | |||
Other | 81.6% | |||
100.0% |
Top Industries | ||||
Oil, Gas & Consumable Fuels | 8.2% | |||
Diversified Financial Services | 7.0% | |||
Pharmaceuticals | 6.0% | |||
Insurance | 4.5% | |||
Industrial Conglomerates | 3.8% | |||
Computers & Peripherals | 3.8% | |||
Commercial Banks | 3.6% | |||
Software | 3.1% | |||
Diversified Telecommunication Services | 3.0% | |||
Semiconductors & Semiconductor Equipment | 2.6% | |||
Other | 54.4% | |||
100.0% |
* | Includes value of collateral received from securities lending. |
** | Includes value of collateral owed from securities lending. |
*** | For purpose of listing top holdings, repurchase agreements are included as part of Other. |
NVIT S&P 500 Index Fund
Common Stock (95.2%) | ||||||||
Shares or | ||||||||
Principal Amount | Value | |||||||
Aerospace & Defense (2.5%) | ||||||||
Boeing Co. (The) | 134,262 | $ | 12,910,634 | |||||
General Dynamics Corp. | 65,900 | 5,154,698 | ||||||
Honeywell International, Inc. | 140,000 | 7,879,200 | ||||||
L-3 Communications Holdings, Inc. | 18,700 | 1,821,193 | ||||||
Lockheed Martin Corp. | 63,000 | 5,930,190 | ||||||
Northrop Grumman Corp. | 56,662 | 4,412,270 | ||||||
Precision Castparts Corp. | 24,700 | 2,997,592 | ||||||
Raytheon Co. (a) | 80,300 | 4,327,367 | ||||||
Rockwell Collins, Inc. (a) | 25,014 | 1,766,989 | ||||||
United Technologies Corp. | 169,400 | 12,015,542 | ||||||
59,215,675 | ||||||||
Air Freight & Logistics (0.9%) | ||||||||
C.H. Robinson Worldwide, Inc. (a) | 27,300 | 1,433,796 | ||||||
FedEx Corp. | 54,600 | 6,058,962 | ||||||
United Parcel Service, Inc., Class B | 181,500 | 13,249,500 | ||||||
20,742,258 | ||||||||
Airline (0.1%) | ||||||||
Southwest Airlines | 121,850 | 1,816,784 | ||||||
Auto Components (0.3%) | ||||||||
B.F. Goodrich Co. (The) | 17,800 | 1,060,168 | ||||||
Goodyear Tire & Rubber Co.* (a) | 38,300 | 1,331,308 | ||||||
Johnson Controls, Inc. | 31,200 | 3,612,024 | ||||||
6,003,500 | ||||||||
Automobiles (0.4%) | ||||||||
Ford Motor Co.* (a) | 338,432 | 3,188,029 | ||||||
General Motors Corp. (a) | 100,752 | 3,808,426 | ||||||
Harley-Davidson, Inc. | 40,900 | 2,438,049 | ||||||
9,434,504 | ||||||||
Beverages (1.2%) | ||||||||
Anheuser-Busch Cos., Inc. | 134,543 | 7,017,763 | ||||||
Brown-Forman Corp., Class B (a) | 13,000 | 950,040 | ||||||
Coca-Cola Co. | 342,712 | 17,927,265 | ||||||
Coca-Cola Enterprises, Inc. (a) | 48,000 | 1,152,000 | ||||||
Constellation Brands, Inc.* | 27,500 | 667,700 | ||||||
Molson Coors Brewing Co. (a) | 9,800 | 906,108 | ||||||
Pepsi Bottling Group, Inc. (The) | 23,100 | 778,008 | ||||||
29,398,884 | ||||||||
Biotechnology (1.2%) | ||||||||
Amgen, Inc.* | 198,632 | 10,982,363 | ||||||
Applera Corp. | 28,600 | 873,444 | ||||||
Biogen, Inc.* | 51,439 | 2,751,987 | ||||||
Celgene Corp.* (a) | 63,600 | 3,646,188 | ||||||
Genzyme Corp.* | 47,900 | 3,084,760 | ||||||
Gilead Sciences, Inc.* | 154,400 | 5,986,088 | ||||||
Millipore Corp.* (a) | 7,800 | 585,702 | ||||||
PerkinElmer, Inc. | 15,100 | 393,506 | ||||||
28,304,038 | ||||||||
Building Products (0.2%) | ||||||||
American Standard Cos., Inc. | 33,200 | 1,958,136 | ||||||
Masco Corp. (a) | 73,481 | 2,092,004 | ||||||
4,050,140 | ||||||||
Capital Markets (1.4%) | ||||||||
Ameriprise Financial, Inc. | 37,380 | 2,376,247 | ||||||
Bank of New York Co., Inc. | 122,228 | 5,065,128 | ||||||
Bear Stearns Cos., Inc. (The) | 21,900 | 3,066,000 | ||||||
Charles Schwab Corp. | 184,250 | 3,780,810 | ||||||
E*TRADE Financial Corp.* (a) | 78,900 | 1,742,901 | ||||||
Federated Investors, Inc., Class B | 13,100 | 502,123 | ||||||
Janus Capital Group, Inc. (a) | 31,200 | 868,608 | ||||||
Legg Mason, Inc. | 20,500 | 2,016,790 | ||||||
Lehman Brothers Holding, Inc. | 86,734 | 6,463,418 | ||||||
Mellon Financial Corp. (a) | 76,800 | 3,379,200 | ||||||
Northern Trust Corp. | 29,000 | 1,862,960 | ||||||
T. Rowe Price Group, Inc. | 40,900 | 2,122,301 | ||||||
33,246,486 | ||||||||
Chemicals (1.5%) | ||||||||
Air Products & Chemicals, Inc. | 33,600 | 2,700,432 | ||||||
Ashland, Inc. | 10,000 | 639,500 | ||||||
Dow Chemical Co. (The) | 162,366 | 7,179,824 | ||||||
E.I. du Pont de Nemours & Co. | 162,200 | 8,246,248 | ||||||
Eastman Chemical Co. | 11,600 | 746,228 | ||||||
Ecolab, Inc. | 28,500 | 1,216,950 | ||||||
Hercules, Inc.* | 13,700 | 269,205 | ||||||
International Flavors & Fragrances, Inc. | 11,100 | 578,754 | ||||||
Monsanto Co. | 89,390 | 6,037,401 | ||||||
PPG Industries, Inc. | 24,600 | 1,872,306 | ||||||
Praxair, Inc. | 58,100 | 4,182,619 | ||||||
Rohm & Haas Co. | 23,000 | 1,257,640 | ||||||
Sigma-Aldrich Corp. (a) | 18,700 | 797,929 | ||||||
35,725,036 | ||||||||
Commercial Banks (3.6%) | ||||||||
BB&T Corp. | 86,200 | 3,506,616 | ||||||
Comerica, Inc. | 25,200 | 1,498,644 | ||||||
Commerce Bancorp, Inc. (a) | 31,300 | 1,157,787 | ||||||
Compass Bancshares, Inc. | 18,600 | 1,283,028 |
Common Stock (continued) | ||||||||
Shares or | ||||||||
Principal Amount | Value | |||||||
Commercial Banks (continued) | ||||||||
Fifth Third Bancorp | 100,685 | $ | 4,004,243 | |||||
First Horizon National Corp. (a) | 21,900 | 854,100 | ||||||
Huntington Bancshares, Inc. (a) | 58,310 | 1,325,969 | ||||||
KeyCorp | 74,400 | 2,554,152 | ||||||
M & T Bank Corp. (a) | 12,200 | 1,304,180 | ||||||
Marshall & Ilsley Corp. | 43,900 | 2,090,957 | ||||||
National City Corp. (a) | 108,100 | 3,601,892 | ||||||
PNC Bank Corp. | 58,900 | 4,216,062 | ||||||
Regions Financial Corp. (a) | 117,371 | 3,884,980 | ||||||
SunTrust Banks, Inc. | 63,300 | 5,427,342 | ||||||
Synovus Financial Corp. (a) | 47,800 | 1,467,460 | ||||||
U.S. Bancorp | 308,668 | 10,170,611 | ||||||
Wachovia Corp. | 324,293 | 16,620,016 | ||||||
Wells Fargo & Co. | 574,918 | 20,219,866 | ||||||
Zions Bancorp | 18,200 | 1,399,762 | ||||||
86,587,667 | ||||||||
Commercial Services & Supplies (0.6%) | ||||||||
Allied Waste Industries, Inc.* (a) | 34,900 | 469,754 | ||||||
Avery-Dennison Corp. | 19,400 | 1,289,712 | ||||||
Cintas Corp. | 20,100 | 792,543 | ||||||
Donnelley (R.R.) & Sons Co. (a) | 32,800 | 1,427,128 | ||||||
Equifax, Inc. (a) | 28,600 | 1,270,412 | ||||||
Monster Worldwide, Inc.* (a) | 24,800 | 1,019,280 | ||||||
Pitney Bowes, Inc. | 32,200 | 1,507,604 | ||||||
Robert Half International, Inc. (a) | 24,700 | 901,550 | ||||||
Waste Management, Inc. | 85,900 | 3,354,395 | ||||||
Western Union Co. | 124,716 | 2,597,834 | ||||||
14,630,212 | ||||||||
Communications Equipment (2.5%) | ||||||||
Avaya, Inc.* | 83,166 | 1,400,515 | ||||||
Ciena Corp.* (a) | 18,563 | 670,681 | ||||||
Cisco Systems, Inc.* | 1,027,757 | 28,623,033 | ||||||
Corning, Inc.* | 261,800 | 6,688,990 | ||||||
JDS Uniphase Corp.* (a) | 46,750 | 627,853 | ||||||
Juniper Networks, Inc.* | 102,400 | 2,577,408 | ||||||
Motorola, Inc. | 398,700 | 7,056,990 | ||||||
QUALCOMM, Inc. | 281,900 | 12,231,641 | ||||||
Tellabs, Inc.* | 72,300 | 777,948 | ||||||
60,655,059 | ||||||||
Computers & Peripherals (3.8%) | ||||||||
Apple, Inc.* | 146,700 | 17,903,268 | ||||||
Dell, Inc.* | 386,500 | 11,034,575 | ||||||
EMC Corp.* | 368,000 | 6,660,800 | ||||||
Hewlett-Packard Co. | 455,400 | 20,319,948 | ||||||
International Business Machines Corp. | 232,417 | 24,461,889 | ||||||
Lexmark International Group, Inc.* (a) | 19,000 | 936,890 | ||||||
NCR Corp.* | 27,000 | 1,418,580 | ||||||
Network Appliance, Inc.* | 67,500 | 1,971,000 | ||||||
QLogic Corp.* | 35,500 | 591,075 | ||||||
SanDisk Corp.* | 41,800 | 2,045,692 | ||||||
Sun Microsystems, Inc.* | 639,656 | 3,364,591 | ||||||
90,708,308 | ||||||||
Construction & Engineering (0.1%) | ||||||||
Fluor Corp. | 16,700 | 1,859,879 | ||||||
Construction Materials (0.1%) (a) | ||||||||
Vulcan Materials Co. | 17,592 | 2,014,988 | ||||||
Consumer Finance (0.9%) | ||||||||
American Express Co. | 202,900 | 12,413,422 | ||||||
Capital One Financial Corp. | 72,000 | 5,647,680 | ||||||
SLM Corp. | 67,400 | 3,880,892 | ||||||
21,941,994 | ||||||||
Containers & Packaging (0.2%) | ||||||||
Ball Corp. | 15,100 | 802,867 | ||||||
Bemis Co. | 14,500 | 481,110 | ||||||
Pactiv Corp.* | 23,000 | 733,470 | ||||||
Sealed Air Corp. | 23,000 | 713,460 | ||||||
Temple-Inland, Inc. | 17,000 | 1,046,010 | ||||||
3,776,917 | ||||||||
Distributors (0.2%) | ||||||||
Genuine Parts Co. | 24,000 | 1,190,400 | ||||||
ProLogis Trust | 42,400 | 2,412,560 | ||||||
3,602,960 | ||||||||
Diversified Consumer Services (0.1%) (a) | ||||||||
Apollo Group, Inc.* | 27,100 | 1,583,453 | ||||||
H & R Block, Inc. | 48,000 | 1,121,760 | ||||||
2,705,213 | ||||||||
Diversified Financial Services (7.0%) | ||||||||
Bank of America Corp. | 760,993 | 37,204,948 | ||||||
Chicago Mercantile Exchange Holdings, Inc. | 6,268 | 3,349,368 | ||||||
CIT Group, Inc. | 30,200 | 1,655,866 | ||||||
Citigroup, Inc. | 846,354 | 43,409,497 | ||||||
Franklin Resources, Inc. | 26,700 | 3,536,949 | ||||||
Goldman Sachs Group, Inc. | 70,000 | 15,172,500 |
NVIT S&P 500 Index Fund (Continued)
Common Stock (continued) | ||||||||
Shares or | ||||||||
Principal Amount | Value | |||||||
Diversified Financial Services (continued) | ||||||||
J.P. Morgan Chase & Co. | 591,001 | $ | 28,633,998 | |||||
Merrill Lynch & Co., Inc. | 150,500 | 12,578,790 | ||||||
Moody’s Corp. (a) | 42,308 | 2,631,558 | ||||||
Morgan Stanley | 181,100 | 15,190,668 | ||||||
State Street Corp. (a) | 63,900 | 4,370,760 | ||||||
167,734,902 | ||||||||
Diversified Telecommunication Services (3.0%) | ||||||||
AT&T, Inc. | 1,062,521 | 44,094,622 | ||||||
CenturyTel, Inc. | 19,200 | 941,760 | ||||||
Citizens Communications Co. | 66,600 | 1,016,982 | ||||||
Embarq Corp. | 28,634 | 1,814,537 | ||||||
Qwest Communications International, Inc.* (a) | 273,123 | 2,649,293 | ||||||
Verizon Communications, Inc. | 495,102 | 20,383,349 | ||||||
Windstream Corp. (a) | 69,903 | 1,031,768 | ||||||
71,932,311 | ||||||||
Electric Utilities (1.7%) | ||||||||
Allegheny Energy, Inc.* | 24,600 | 1,272,804 | ||||||
American Electric Power Co., Inc. | 72,960 | 3,286,118 | ||||||
Duke Energy Corp. | 200,876 | 3,676,031 | ||||||
Edison International | 59,800 | 3,355,976 | ||||||
Entergy Corp. | 36,000 | 3,864,600 | ||||||
Exelon Corp. | 116,324 | 8,445,123 | ||||||
FirstEnergy Corp. | 58,086 | 3,759,907 | ||||||
FPL Group, Inc. | 66,900 | 3,795,906 | ||||||
Integrys Energy Group, Inc. (a) | 10,437 | 529,469 | ||||||
Pinnacle West Capital Corp. (a) | 16,500 | 657,525 | ||||||
PPL Corp. | 59,900 | 2,802,721 | ||||||
Progress Energy, Inc. (a) | 38,526 | 1,756,400 | ||||||
Southern Co. | 134,500 | 4,612,005 | ||||||
41,814,585 | ||||||||
Electrical Equipment (0.4%) | ||||||||
Cooper Industries Ltd., Class A ADR - BM | 26,530 | 1,514,598 | ||||||
Emerson Electric Co. | 130,500 | 6,107,400 | ||||||
Rockwell International Corp. (a) | 31,200 | 2,166,528 | ||||||
9,788,526 | ||||||||
Electronic Equipment & Instruments (0.2%) | ||||||||
Agilent Technologies, Inc.* | 64,761 | 2,489,413 | ||||||
Jabil Circuit, Inc. | 25,400 | 560,578 | ||||||
Molex, Inc. | 22,725 | 681,977 | ||||||
Solectron Corp.* | 123,200 | 453,376 | ||||||
Tektronix, Inc. | 11,900 | 401,506 | ||||||
4,586,850 | ||||||||
Energy Equipment & Services (2.0%) | ||||||||
Baker Hughes, Inc. | 52,300 | 4,399,999 | ||||||
BJ Services Co. | 55,600 | 1,581,264 | ||||||
ENSCO International, Inc. (a) | 29,300 | 1,787,593 | ||||||
Halliburton Co. | 150,700 | 5,199,150 | ||||||
Nabors Industries Ltd. - BM* (a) | 53,000 | 1,769,140 | ||||||
National-OilWell, Inc.* | 28,800 | 3,002,112 | ||||||
Noble Corp. ADR - KY (a) | 25,400 | 2,477,008 | ||||||
Rowan Cos., Inc. | 23,600 | 967,128 | ||||||
Schlumberger Ltd. ADR - NL (a) | 200,580 | 17,037,265 | ||||||
Smith International, Inc. | 38,000 | 2,228,320 | ||||||
Transocean, Inc. ADR - KY* | 49,900 | 5,288,402 | ||||||
Weatherford International Ltd. ADR - BM* (a) | 53,700 | 2,966,388 | ||||||
48,703,769 | ||||||||
Entertainment (0.5%) | ||||||||
Walt Disney Co. (The) | 348,600 | 11,901,204 | ||||||
Food & Staples Retailing (2.2%) | ||||||||
Costco Wholesale Corp. | 81,300 | 4,757,676 | ||||||
CVS/Caremark Corp. | 257,511 | 9,386,276 | ||||||
Kroger Co. | 126,900 | 3,569,697 | ||||||
Safeway, Inc. | 70,400 | 2,395,712 | ||||||
SUPERVALU, Inc. | 38,703 | 1,792,723 | ||||||
SYSCO Corp. | 98,700 | 3,256,113 | ||||||
Wal-Mart Stores, Inc. | 418,488 | 20,133,458 | ||||||
Walgreen Co. | 165,700 | 7,214,578 | ||||||
Whole Foods Market, Inc. (a) | 27,400 | 1,049,420 | ||||||
53,555,653 | ||||||||
Food Products (2.2%) | ||||||||
Archer-Daniels Midland Co. | 115,637 | 3,826,428 | ||||||
Campbell Soup Co. | 33,600 | 1,304,016 | ||||||
ConAgra, Inc. | 94,900 | 2,549,014 | ||||||
Dean Foods Co. (a) | 27,700 | 882,799 | ||||||
General Mills, Inc. | 62,900 | 3,674,618 | ||||||
H.J. Heinz Co. (a) | 60,600 | 2,876,682 | ||||||
Hershey Foods Corp. | 27,600 | 1,397,112 | ||||||
Kellogg Co. | 39,000 | 2,019,810 | ||||||
Kraft Foods, Inc. | 286,216 | 10,089,114 | ||||||
McCormick & Co. | 18,200 | 694,876 | ||||||
PepsiCo, Inc. | 278,730 | 18,075,640 | ||||||
Sara Lee Corp. | 136,529 | 2,375,605 | ||||||
Tyson Foods, Inc., Class A (a) | 36,100 | 831,744 | ||||||
Wrigley (Wm.) Jr. Co., Class A (a) | 34,625 | 1,915,109 | ||||||
52,512,567 | ||||||||
Common Stock (continued) | ||||||||
Shares or | ||||||||
Principal Amount | Value | |||||||
Gas Utilities (0.1%) | ||||||||
NICOR, Inc. (a) | 6,400 | $ | 274,688 | |||||
Questar Corp. | 33,800 | 1,786,330 | ||||||
2,061,018 | ||||||||
Health Care Equipment & Supplies (1.5%) | ||||||||
Bard (C.R.), Inc. | 15,600 | 1,289,028 | ||||||
Bausch & Lomb, Inc. | 7,900 | 548,576 | ||||||
Baxter International, Inc. | 114,000 | 6,422,760 | ||||||
Becton, Dickinson & Co. | 38,300 | 2,853,350 | ||||||
Biomet, Inc. | 36,651 | 1,675,684 | ||||||
Boston Scientific Corp.* | 196,667 | 3,016,872 | ||||||
Hospira, Inc.* | 23,736 | 926,653 | ||||||
Medtronic, Inc. | 200,200 | 10,382,372 | ||||||
St. Jude Medical, Inc.* | 60,400 | 2,505,996 | ||||||
Stryker Corp. (a) | 48,000 | 3,028,320 | ||||||
Varian Medical Systems, Inc.* (a) | 20,200 | 858,702 | ||||||
Zimmer Holdings, Inc.* (a) | 42,726 | 3,627,010 | ||||||
37,135,323 | ||||||||
Health Care Providers & Services (2.2%) | ||||||||
Aetna, Inc. | 91,700 | 4,529,980 | ||||||
AmerisourceBergen Corp. | 35,208 | 1,741,740 | ||||||
Cardinal Health, Inc. | 70,853 | 5,005,056 | ||||||
CIGNA Corp. | 53,200 | 2,778,104 | ||||||
Coventry Health Care, Inc.* | 24,400 | 1,406,660 | ||||||
Express Scripts, Inc., Class A* (a) | 49,400 | 2,470,494 | ||||||
Humana, Inc.* | 28,500 | 1,735,935 | ||||||
Laboratory Corp. of America Holdings* (a) | 19,300 | 1,510,418 | ||||||
Manor Care, Inc. (a) | 14,800 | 966,292 | ||||||
McKesson Corp. | 53,200 | 3,172,848 | ||||||
Medco Health Solutions, Inc.* | 50,948 | 3,973,434 | ||||||
Patterson Cos., Inc.* (a) | 20,200 | 752,854 | ||||||
Quest Diagnostics, Inc. (a) | 26,000 | 1,342,900 | ||||||
Tenet Healthcare Corp.* (a) | 65,500 | 426,405 | ||||||
UnitedHealth Group, Inc. | 230,444 | 11,784,906 | ||||||
WellPoint, Inc.* | 107,000 | 8,541,810 | ||||||
52,139,836 | ||||||||
Health Care Technology (0.0%) (a) | ||||||||
IMS Health, Inc. | 28,653 | 920,621 | ||||||
Hotels, Restaurants & Leisure (1.4%) | ||||||||
Carnival Corp. - PA (a) | 71,100 | 3,467,547 | ||||||
Darden Restaurants, Inc. | 22,450 | 987,575 | ||||||
Harrah’s Entertainment, Inc. | 28,800 | 2,455,488 | ||||||
Hilton Hotels Corp. | 62,900 | 2,105,263 | ||||||
International Game Technology | 61,500 | 2,441,550 | ||||||
Marriott International, Inc., Class A | 52,000 | 2,248,480 | ||||||
McDonald’s Corp. | 199,800 | 10,141,848 | ||||||
Starbucks Corp.* | 134,800 | 3,537,152 | ||||||
Starwood Hotels & Resorts Worldwide, Inc. | 39,400 | 2,642,558 | ||||||
Wendy’s International, Inc. | 18,900 | 694,575 | ||||||
Wyndham Worldwide Corp.* | 29,080 | 1,054,441 | ||||||
YUM! Brands, Inc. (a) | 82,400 | 2,696,128 | ||||||
34,472,605 | ||||||||
Household Durables (0.5%) | ||||||||
Black & Decker Corp. | 13,000 | 1,148,030 | ||||||
Centex Corp. (a) | 19,200 | 769,920 | ||||||
D. R. Horton, Inc. (a) | 40,400 | 805,172 | ||||||
Fortune Brands, Inc. | 22,900 | 1,886,273 | ||||||
Harman International Industries, Inc. | 10,000 | 1,168,000 | ||||||
KB Home (a) | 16,100 | 633,857 | ||||||
Leggett & Platt, Inc. | 25,600 | 564,480 | ||||||
Lennar Corp., Class A (a) | 22,500 | 822,600 | ||||||
Newell Rubbermaid, Inc. | 39,900 | 1,174,257 | ||||||
Pulte Corp. (a) | 31,700 | 711,665 | ||||||
Snap-on, Inc. | 8,300 | 419,233 | ||||||
Stanley Works (The) (a) | 10,600 | 643,420 | ||||||
Whirlpool Corp. | 14,751 | 1,640,311 | ||||||
12,387,218 | ||||||||
Household Products (1.8%) | ||||||||
Colgate-Palmolive Co. | 91,161 | 5,911,791 | ||||||
Kimberly-Clark Corp. | 74,100 | 4,956,549 | ||||||
Procter & Gamble Co. (The) | 536,899 | 32,852,850 | ||||||
43,721,190 | ||||||||
Independent Power Producers & Energy Traders (0.5%) | ||||||||
AES Corp.* | 106,100 | 2,321,468 | ||||||
Clorox Co. (The) | 29,599 | 1,838,098 | ||||||
Constellation Energy Group | 33,200 | 2,894,044 | ||||||
Dynegy, Inc.* (a) | 64,701 | 610,777 | ||||||
TXU Corp. | 75,200 | 5,060,960 | ||||||
12,725,347 | ||||||||
Industrial Conglomerates (3.8%) | ||||||||
3M Co. | 127,738 | 11,086,381 | ||||||
General Electric Co. | 1,749,748 | 66,980,354 | ||||||
Textron, Inc. | 19,400 | 2,136,134 | ||||||
Tyco International Ltd. - BM | 336,456 | 11,368,848 | ||||||
91,571,717 | ||||||||
NVIT S&P 500 Index Fund (Continued)
Common Stock (continued) | ||||||||
Shares or | ||||||||
Principal Amount | Value | |||||||
Insurance (4.5%) | ||||||||
ACE Ltd. - KY | 51,512 | $ | 3,220,530 | |||||
AFLAC, Inc. | 84,000 | 4,317,600 | ||||||
Allstate Corp. | 106,500 | 6,550,815 | ||||||
AMBAC Financial Group, Inc. (a) | 20,250 | 1,765,598 | ||||||
American International Group, Inc. | 442,668 | 31,000,040 | ||||||
AON Corp. | 55,900 | 2,381,899 | ||||||
Assurant, Inc. (a) | 15,900 | 936,828 | ||||||
Chubb Corp. (The) | 64,900 | 3,513,686 | ||||||
Cincinnati Financial Corp. | 24,721 | 1,072,891 | ||||||
Genworth Financial, Inc. | 82,100 | 2,824,240 | ||||||
Hartford Financial Services Group, Inc. (The) | 52,000 | 5,122,520 | ||||||
Lincoln National Corp. | 43,577 | 3,091,788 | ||||||
Loews Corp. | 71,901 | 3,665,513 | ||||||
Marsh & McLennan Cos., Inc. | 88,300 | 2,726,704 | ||||||
MBIA, Inc. (a) | 26,350 | 1,639,497 | ||||||
MetLife, Inc. | 124,300 | 8,014,864 | ||||||
Principal Financial Group, Inc. | 41,400 | 2,413,206 | ||||||
Progressive Corp. (The) | 118,200 | 2,828,526 | ||||||
Prudential Financial, Inc. | 82,300 | 8,002,029 | ||||||
Safeco Corp. (a) | 18,700 | 1,164,262 | ||||||
Torchmark Corp. | 14,400 | 964,800 | ||||||
Travelers Cos., Inc. (The) | 110,365 | 5,904,528 | ||||||
UnumProvident Corp. (a) | 51,300 | 1,339,443 | ||||||
XL Capital Ltd., Class A - KY | 33,600 | 2,832,144 | ||||||
107,293,951 | ||||||||
Internet & Catalog Retail (0.2%) (a) | ||||||||
Amazon.com, Inc.* | 51,100 | 3,495,751 | ||||||
InterActiveCorp* | 33,800 | 1,169,818 | ||||||
4,665,569 | ||||||||
Internet Software & Services (1.3%) | ||||||||
eBay, Inc.* | 188,100 | 6,053,058 | ||||||
Google, Inc., Class A* | 37,021 | 19,376,051 | ||||||
Verisign, Inc.* (a) | 46,200 | 1,465,926 | ||||||
Yahoo!, Inc.* (a) | 202,800 | 5,501,964 | ||||||
32,396,999 | ||||||||
IT Services (0.9%) | ||||||||
Affiliated Computer Services, Inc., Class A* | 18,500 | 1,049,320 | ||||||
Automatic Data Processing, Inc. | 88,608 | 4,294,830 | ||||||
Cognizant Technology Solutions Corp.* | 26,200 | 1,967,358 | ||||||
Computer Sciences Corp.* (a) | 33,200 | 1,963,780 | ||||||
Convergys Corp.* | 20,100 | 487,224 | ||||||
Electronic Data Systems Corp. | 83,800 | 2,323,774 | ||||||
Fidelity National Information Services, Inc. (a) | 24,400 | 1,324,432 | ||||||
First Data Corp. | 122,516 | 4,002,597 | ||||||
Fiserv, Inc.* | 33,350 | 1,894,280 | ||||||
Paychex, Inc. | 63,150 | 2,470,428 | ||||||
Unisys Corp.* (a) | 47,200 | 431,408 | ||||||
22,209,431 | ||||||||
Leisure Equipment & Products (0.8%) | ||||||||
Brunswick Corp. | 13,200 | 430,716 | ||||||
Eastman Kodak Co. (a) | 54,900 | 1,527,867 | ||||||
Hasbro, Inc. | 32,700 | 1,027,107 | ||||||
Mattel, Inc. (a) | 60,400 | 1,527,516 | ||||||
Time Warner, Inc. | 649,321 | 13,661,714 | ||||||
18,174,920 | ||||||||
Life Sciences Tools & Services (0.2%) | ||||||||
Thermo Fisher Scientific, Inc.* | 73,300 | 3,791,076 | ||||||
Waters Corp.* | 15,900 | 943,824 | ||||||
4,734,900 | ||||||||
Machinery (1.6%) | ||||||||
Caterpillar, Inc. | 107,200 | 8,393,760 | ||||||
Cummins, Inc. | 19,100 | 1,933,111 | ||||||
Danaher Corp. (a) | 44,000 | 3,322,000 | ||||||
Deere & Co. | 40,100 | 4,841,674 | ||||||
Dover Corp. | 33,700 | 1,723,755 | ||||||
Eaton Corp. | 22,600 | 2,101,800 | ||||||
Illinois Tool Works, Inc. | 65,500 | 3,549,445 | ||||||
Ingersoll Rand Co. Ltd., Class A - BM | 56,500 | 3,097,330 | ||||||
ITT Industries, Inc. | 27,100 | 1,850,388 | ||||||
PACCAR, Inc. | 40,087 | 3,489,172 | ||||||
Pall Corp. (a) | 17,200 | 791,028 | ||||||
Parker Hannifin Corp. | 22,100 | 2,163,811 | ||||||
Terex Corp.* | 15,900 | 1,292,670 | ||||||
38,549,944 | ||||||||
Media (2.2%) | ||||||||
CBS Corp., Class B (a) | 133,164 | 4,437,025 | ||||||
Citadel Broadcasting Co. | 1,401 | 9,039 | ||||||
Clear Channel Communications, Inc. | 78,400 | 2,965,088 | ||||||
Comcast Corp., Class A* | 499,322 | 14,040,935 | ||||||
Comcast Corp., Special Class A* (a) | 29,900 | 836,004 | ||||||
DIRECTV Group, Inc.* | 124,100 | 2,867,951 |
Common Stock (continued) | ||||||||
Shares or | ||||||||
Principal Amount | Value | |||||||
Media (continued) | ||||||||
Dow Jones & Co., Inc. | 10,900 | $ | 626,205 | |||||
E.W. Scripps Co., Class A (a) | 11,400 | 520,866 | ||||||
Gannett Co. | 44,200 | 2,428,790 | ||||||
Interpublic Group Cos., Inc. (The)* (a) | 66,900 | 762,660 | ||||||
McGraw-Hill Cos., Inc. (The) | 63,900 | 4,350,312 | ||||||
Meredith Corp. | 6,000 | 369,600 | ||||||
New York Times Co., Class A (a) | 33,000 | 838,200 | ||||||
News Corp. | 389,000 | 8,250,690 | ||||||
Omnicom Group, Inc. (a) | 61,600 | 3,259,872 | ||||||
Tribune Co. | 13,898 | 408,601 | ||||||
Viacom, Inc., Class B* | 111,964 | 4,661,061 | ||||||
51,632,899 | ||||||||
Metals & Mining (0.9%) | ||||||||
Alcoa, Inc. | 153,040 | 6,202,711 | ||||||
Allegheny Technologies, Inc. (a) | 16,800 | 1,761,984 | ||||||
Freeport-McMoRan Copper & Gold, Inc., Class B | 65,764 | 5,446,575 | ||||||
Newmont Mining Corp. | 81,758 | 3,193,467 | ||||||
Nucor Corp. | 49,100 | 2,879,715 | ||||||
U.S. Steel Corp. | 21,300 | 2,316,375 | ||||||
21,800,827 | ||||||||
Multi-Utilities (1.0%) | ||||||||
Ameren Corp. (a) | 40,100 | 1,965,301 | ||||||
CenterPoint Energy, Inc. | 43,800 | 762,120 | ||||||
CMS Energy Corp. (a) | 32,800 | 564,160 | ||||||
Consolidated Edison, Inc. (a) | 49,100 | 2,215,392 | ||||||
Detroit Edison Co. (a) | 35,000 | 1,687,700 | ||||||
Dominion Resources, Inc. | 62,400 | 5,385,744 | ||||||
KeySpan Corp. | 23,900 | 1,003,322 | ||||||
NiSource, Inc. | 35,964 | 744,814 | ||||||
PG&E Corp. | 54,400 | 2,464,320 | ||||||
Public Service Enterprise Group, Inc. | 45,900 | 4,029,102 | ||||||
Sempra Energy | 42,407 | 2,511,767 | ||||||
TECO Energy, Inc. (a) | 36,500 | 627,070 | ||||||
Xcel Energy, Inc. (a) | 57,980 | 1,186,851 | ||||||
25,147,663 | ||||||||
Multiline Retail (1.1%) | ||||||||
Big Lots, Inc.* (a) | 23,000 | 676,660 | ||||||
Dillard’s, Inc. (a) | 14,300 | 513,799 | ||||||
Dollar General Corp. | 46,875 | 1,027,500 | ||||||
Family Dollar Stores, Inc. | 22,400 | 768,768 | ||||||
J.C. Penney Co., Inc. | 40,600 | 2,938,628 | ||||||
Kohl’s Corp.* | 54,100 | 3,842,723 | ||||||
Macy’s, Inc. | 82,622 | 3,286,703 | ||||||
Nordstrom, Inc. | 41,800 | 2,136,816 | ||||||
Sears Holdings Corp.* (a) | 15,173 | 2,571,823 | ||||||
Target Corp. | 142,616 | 9,070,378 | ||||||
26,833,798 | ||||||||
Office Electronics (0.1%) | ||||||||
Xerox Corp.* | 152,000 | 2,808,960 | ||||||
Oil, Gas & Consumable Fuels (8.2%) | ||||||||
Anadarko Petroleum Corp. | 76,898 | 3,997,927 | ||||||
Apache Corp. | 59,398 | 4,846,283 | ||||||
Chesapeake Energy Corp. | 75,400 | 2,608,840 | ||||||
ChevronTexaco Corp. | 367,146 | 30,928,379 | ||||||
ConocoPhillips | 279,736 | 21,959,276 | ||||||
CONSOL Energy, Inc. | 28,000 | 1,291,080 | ||||||
Devon Energy Corp. | 72,500 | 5,676,025 | ||||||
El Paso Corp. | 109,377 | 1,884,566 | ||||||
EOG Resources, Inc. | 42,400 | 3,097,744 | ||||||
Exxon Mobil Corp. | 963,154 | 80,789,357 | ||||||
Hess Corp. | 49,300 | 2,906,728 | ||||||
Marathon Oil Corp. (a) | 121,202 | 7,267,272 | ||||||
Murphy Oil Corp. | 28,500 | 1,694,040 | ||||||
Occidental Petroleum Corp. | 138,300 | 8,004,804 | ||||||
Peabody Energy Corp. (a) | 42,500 | 2,056,150 | ||||||
Spectra Energy Corp. | 99,588 | 2,585,304 | ||||||
Sunoco, Inc. | 22,800 | 1,816,704 | ||||||
Valero Energy Corp. | 95,500 | 7,053,630 | ||||||
Williams Cos., Inc. (The) | 107,300 | 3,392,826 | ||||||
XTO Energy, Inc. | 66,666 | 4,006,627 | ||||||
197,863,562 | ||||||||
Paper & Forest Products (0.3%) | ||||||||
International Paper Co. | 70,521 | 2,753,845 | ||||||
MeadWestvaco Corp. | 37,407 | 1,321,215 | ||||||
Weyerhaeuser Co. | 38,200 | 3,015,126 | ||||||
7,090,186 | ||||||||
Personal Products (0.2%) | ||||||||
Avon Products, Inc. | 80,200 | 2,947,350 | ||||||
Estee Lauder Co., Inc. (The), Class A | 19,000 | 864,690 | ||||||
3,812,040 | ||||||||
Pharmaceuticals (6.0%) | ||||||||
Abbott Laboratories | 262,567 | 14,060,463 | ||||||
Allergan, Inc. (a) | 55,400 | 3,193,256 | ||||||
Barr Pharmaceuticals, Inc.* | 17,600 | 884,048 |
NVIT S&P 500 Index Fund (Continued)
Common Stock (continued) | ||||||||
Shares or | ||||||||
Principal Amount | Value | |||||||
Pharmaceuticals (continued) | ||||||||
Bristol-Myers Squibb Co. | 350,162 | $ | 11,051,113 | |||||
Eli Lilly & Co. | 163,970 | 9,162,643 | ||||||
Forest Laboratories, Inc., Class A* | 57,300 | 2,615,745 | ||||||
Johnson & Johnson | 492,411 | 30,342,366 | ||||||
King Pharmaceuticals, Inc.* | 35,033 | 716,775 | ||||||
Merck & Co., Inc. | 368,664 | 18,359,467 | ||||||
Mylan Laboratories, Inc. | 50,500 | 918,595 | ||||||
Pfizer, Inc. | 1,205,861 | 30,833,866 | ||||||
Schering-Plough Corp. | 248,600 | 7,567,384 | ||||||
Watson Pharmaceutical, Inc.* | 14,200 | 461,926 | ||||||
Wyeth | 229,100 | 13,136,594 | ||||||
143,304,241 | ||||||||
Real Estate Investment Trusts (REITs) (1.0%) | ||||||||
Apartment Investment & Management Co. (a) | 21,200 | 1,068,904 | ||||||
Archstone-Smith Trust (a) | 38,700 | 2,287,557 | ||||||
AvalonBay Communities, Inc. (a) | 15,500 | 1,842,640 | ||||||
Boston Properties, Inc. (a) | 22,400 | 2,287,712 | ||||||
Developers Diversified Realty Corp. (a) | 22,800 | 1,201,788 | ||||||
Equity Residential Property Trust | 55,000 | 2,509,650 | ||||||
General Growth Properties, Inc. | 44,100 | 2,335,095 | ||||||
Host Hotels & Resorts, Inc. (a) | 82,700 | 1,912,024 | ||||||
Kimco Realty Corp. (a) | 32,900 | 1,252,503 | ||||||
Plum Creek Timber Co., Inc. (a) | 25,124 | 1,046,666 | ||||||
Public Storage, Inc. (a) | 18,000 | 1,382,760 | ||||||
Simon Property Group, Inc. (a) | 35,300 | 3,284,312 | ||||||
Vornado Realty Trust (a) | 24,300 | 2,669,112 | ||||||
25,080,723 | ||||||||
Real Estate Management & Development (0.0%) (a) | ||||||||
CB Richard Ellis Group, Inc., Class A* | 28,100 | 1,025,650 | ||||||
Road & Rail (0.8%) | ||||||||
Burlington Northern Santa Fe Corp. | 58,300 | 4,963,662 | ||||||
CSX Corp. | 78,700 | 3,547,796 | ||||||
Norfolk Southern Corp. | 71,100 | 3,737,727 | ||||||
Ryder System, Inc. | 9,400 | 505,720 | ||||||
Union Pacific Corp. | 47,000 | 5,412,050 | ||||||
18,166,955 | ||||||||
Semiconductors & Semiconductor Equipment (2.6%) | ||||||||
Advanced Micro Devices, Inc.* (a) | 104,400 | 1,492,920 | ||||||
Altera Corp. | 59,300 | 1,312,309 | ||||||
Analog Devices, Inc. | 53,000 | 1,994,920 | ||||||
Applied Materials, Inc. | 249,300 | 4,953,591 | ||||||
Broadcom Corp.* | 75,800 | 2,217,150 | ||||||
Intel Corp. | 981,273 | 23,315,046 | ||||||
KLA-Tencor Corp. | 38,000 | 2,088,100 | ||||||
Linear Technology Corp. (a) | 48,700 | 1,761,966 | ||||||
LSI Logic Corp.* (a) | 115,000 | 863,650 | ||||||
Maxim Integrated Products, Inc. (a) | 61,500 | 2,054,715 | ||||||
MEMC Electronic Materials, Inc.* | 35,900 | 2,194,208 | ||||||
Micron Technology, Inc.* (a) | 139,600 | 1,749,188 | ||||||
National Semiconductor Corp. (a) | 48,800 | 1,379,576 | ||||||
Novellus Systems* (a) | 26,200 | 743,294 | ||||||
NVIDIA Corp.* | 56,800 | 2,346,408 | ||||||
Teradyne, Inc.* (a) | 26,700 | 469,386 | ||||||
Texas Instruments, Inc. | 240,000 | 9,031,200 | ||||||
Xilinx, Inc. | 59,600 | 1,595,492 | ||||||
61,563,119 | ||||||||
Software (3.1%) | ||||||||
Adobe Systems, Inc.* | 103,700 | 4,163,555 | ||||||
Autodesk, Inc.* | 42,830 | 2,016,436 | ||||||
BMC Software, Inc.* | 30,800 | 933,240 | ||||||
CA, Inc. (a) | 67,000 | 1,730,610 | ||||||
Citrix Systems, Inc.* | 34,800 | 1,171,716 | ||||||
Compuware Corp.* | 51,800 | 614,348 | ||||||
Electronic Arts, Inc.* | 56,100 | 2,654,652 | ||||||
Intuit, Inc.* | 63,900 | 1,922,112 | ||||||
Microsoft Corp. | 1,438,640 | 42,396,721 | ||||||
Novell, Inc.* (a) | 48,600 | 378,594 | ||||||
Oracle Corp.* | 679,036 | 13,383,800 | ||||||
Symantec Corp.* (a) | 165,091 | 3,334,838 | ||||||
74,700,622 | ||||||||
Specialty Retail (2.1%) | ||||||||
Abercrombie & Fitch Co. | 16,700 | 1,218,766 | ||||||
AutoNation, Inc.* (a) | 26,883 | 603,254 | ||||||
AutoZone, Inc.* | 10,100 | 1,379,862 | ||||||
Bed Bath & Beyond, Inc.* | 43,800 | 1,576,362 | ||||||
Best Buy Co., Inc. | 72,075 | 3,363,740 | ||||||
Circuit City Stores, Inc. (a) | 32,500 | 490,100 | ||||||
Coach, Inc.* | 64,100 | 3,037,699 | ||||||
Gap, Inc. (The) (a) | 86,100 | 1,644,510 | ||||||
Home Depot, Inc. (The) | 347,282 | 13,665,547 | ||||||
Limited, Inc. (The) | 63,766 | 1,750,377 | ||||||
Lowe’s Cos., Inc. | 253,072 | 7,766,780 | ||||||
Nike, Inc. | 66,500 | 3,876,285 | ||||||
Office Depot, Inc.* | 49,600 | 1,502,880 | ||||||
OfficeMax, Inc. (a) | 16,100 | 632,730 |
Common Stock (continued) | ||||||||
Shares or | ||||||||
Principal Amount | Value | |||||||
Specialty Retail (continued) | ||||||||
RadioShack Corp. (a) | 27,300 | $ | 904,722 | |||||
Sherwin Williams Co. | 22,000 | 1,462,340 | ||||||
Staples, Inc. | 129,150 | 3,064,729 | ||||||
Tiffany & Co. | 24,500 | 1,299,970 | ||||||
TJX Cos., Inc. (a) | 71,300 | 1,960,750 | ||||||
51,201,403 | ||||||||
Textiles, Apparel & Luxury Goods (0.2%) 25,200 711,900 | ||||||||
Jones Apparel Group, Inc. | 23,800 | 887,740 | ||||||
Liz Claiborne, Inc. (a) | 12,300 | 1,206,753 | ||||||
Polo Ralph Lauren Corp. (a) | 13,600 | 1,245,488 | ||||||
V.F. Corp. | ||||||||
4,051,881 | ||||||||
Thrifts & Mortgage Finance (1.3%) 104,100 3,784,035 | ||||||||
Countrywide Credit Industries, Inc. (a) | 164,686 | 10,758,936 | ||||||
Fannie Mae | 116,800 | 7,089,760 | ||||||
Freddie Mac | 77,300 | 944,606 | ||||||
Hudson City Bancorp, Inc. (a) | 17,000 | 966,620 | ||||||
MGIC Investment Corp. (a) | 51,605 | 1,090,930 | ||||||
Sovereign Bancorp (a) | 157,078 | 6,697,806 | ||||||
Washington Mutual, Inc. (a) | ||||||||
31,332,693 | ||||||||
Tobacco (1.2%) 357,100 25,046,994 | ||||||||
Altria Group, Inc. | 27,900 | 1,819,080 | ||||||
Reynolds American, Inc. | 24,600 | 1,321,266 | ||||||
UST, Inc. (a) | ||||||||
28,187,340 | ||||||||
Trading Companies & Distributors (0.0%) 11,500 1,070,075 | ||||||||
Grainger (W.W.), Inc. | ||||||||
Wireless Telecommunication Services (0.6%) 58,400 3,944,920 | ||||||||
ALLTEL Corp. | ||||||||
Wireless Telecommunication Services (continued) 493,899 10,228,648 | ||||||||
Sprint Nextel Corp. | ||||||||
14,173,568 | ||||||||
Total Common Stocks (Cost $2,153,571,545) | 2,284,959,663 | |||||||
Repurchase Agreements (4.7%) | ||||||||
Shares or | ||||||||
Principal Amount | Value | |||||||
Nomura Securities, 5.20%, dated 06/29/07, due 07/02/07, repurchase price $114,239,474, collateralized by U.S. Government Agency Mortgages with a market value of $116,473,792 | $ | 114,189,992 | $ | 114,189,992 | ||||
Securities Held as Collateral for Securities on Loan (3.6%) | ||||||||
Shares or | ||||||||
Principal Amount | Value | |||||||
Morgan Stanley Repurchase Agreement, 5.42%, dated 06/29/07, due 07/02/07, repurchase price $85,531,153, collateralized by U. S. Government Agency Mortgages with a market value of $87,202,390 | 85,492,539 | 85,492,539 | ||||||
Total Investments (Cost $2,353,254,076) (b) — 103.5% | 2,484,642,194 | |||||||
Liabilities in excess of other assets — (3.5)% | (83,791,637 | ) | ||||||
NET ASSETS — 100.0% | $ | 2,400,850,557 | ||||||
* | Denotes a non-income producing security. | |
(a) | All or part of the security was on loan as of June 30, 2007. | |
(b) | See notes to financial statements for tax unrealized appreciation (depreciation) of securities. |
ADR | American Depository Receipt | |
BM | Bermuda | |
KY | Cayman Islands | |
NL | Netherlands | |
PA | Panama |
At June 30, 2007, the Fund’s open futures contracts were as follows:
Market Value | Unrealized | |||||||||||||||
Number of | Long | Covered by | Appreciation | |||||||||||||
Contracts | Contracts | Expiration | Contracts | (Depreciation) | ||||||||||||
316 | S&P Emini Futures | 09/21/07 | $ | 119,716,600 | $ | (1,107,794 | ) | |||||||||
$ | 119,716,600 | $ | (1,107,794 | ) | ||||||||||||
See accompanying notes to financial statements.
NVIT S&P 500 | ||||||
Index Fund | ||||||
Assets: | ||||||
Investments, at value (cost $2,153,571,545)* | $ | 2,284,959,663 | ||||
Repurchase agreements, at cost and value | 199,682,531 | |||||
Total Investments | 2,484,642,194 | |||||
Interest and dividends receivable | 2,969,868 | |||||
Receivable for capital shares issued | 1,827,922 | |||||
Receivable for investments sold | 1,442,967 | |||||
Prepaid expenses | 7,231 | |||||
Total Assets | 2,490,890,182 | |||||
Liabilities: | ||||||
Payable to custodian | 129,477 | |||||
Payable for variation margin on futures contracts | 131,485 | |||||
Payable for investments purchased | 3,602,339 | |||||
Payable upon return of securities loaned | 85,492,539 | |||||
Payable for capital shares redeemed | 109,648 | |||||
Accrued expenses and other payables: | ||||||
Investment advisory fees | 387,775 | |||||
Fund administration and transfer agent fees | 145,582 | |||||
Administrative servicing fees | 18,126 | |||||
Compliance program costs | 8,860 | |||||
Other | 13,794 | |||||
Total Liabilities | 90,039,625 | |||||
Net Assets | $ | 2,400,850,557 | ||||
Represented by: | ||||||
Capital | $ | 2,325,495,506 | ||||
Accumulated net investment income | 625,170 | |||||
Accumulated net realized losses from investment transactions and futures | (55,550,443 | ) | ||||
Net unrealized appreciation on investments and futures | 130,280,324 | |||||
Net Assets | $ | 2,400,850,557 | ||||
Net Assets: | ||||||
Class IV Shares | $ | 274,049,523 | ||||
Class ID Shares | 2,126,801,034 | |||||
Total | $ | 2,400,850,557 | ||||
Shares outstanding (unlimited number of shares authorized): | ||||||
Class IV Shares | 26,164,487 | |||||
Class ID Shares | 203,120,547 | |||||
Total | 229,285,034 | |||||
Net asset value and offering price per share (Net assets by class divided by shares outstanding by class, respectively.): | ||||||
Class IV Shares | $ | 10.47 | ||||
Class ID Shares | $ | 10.47 | ||||
* | Includes value of securities on loan of $83,796,115. |
14
NVIT S&P 500 | |||||
Index Fund | |||||
INVESTMENT INCOME: | |||||
Interest income | $ | 1,915,675 | |||
Dividend income | 11,350,266 | ||||
Income from securities lending | 36,335 | ||||
Total Income | 13,302,276 | ||||
Expenses: | |||||
Investment advisory fees | 953,448 | ||||
Fund administration and transfer agent fees | 390,664 | ||||
Administrative servicing fees Class IV Shares | 125,014 | ||||
Custodian fees | 9,054 | ||||
Trustee fees | 17,772 | ||||
Compliance program costs (Note 3) | 6,122 | ||||
Other | 87,197 | ||||
Total expenses before earnings credit | 1,589,271 | ||||
Earnings credit (Note 6) | (283 | ) | |||
Net Expenses | 1,588,988 | ||||
Net Investment Income | 11,713,288 | ||||
REALIZED/UNREALIZED GAINS (LOSSES) FROM INVESTMENTS: | |||||
Net realized gains on investment transactions | 527,114 | ||||
Net realized gains on futures transactions | 5,764,198 | ||||
Net realized gains on investment transactions and futures | 6,291,312 | ||||
Net change in unrealized appreciation on investments and futures | 78,380,005 | ||||
Net realized/unrealized gains (losses) on investments and futures | 84,671,317 | ||||
CHANGE IN NET ASSETS RESULTING FROM OPERATIONS | $ | 96,384,605 | |||
15
NVIT S&P 500 Index Fund | |||||||||
Six Months Ended | Year Ended | ||||||||
June 30, 2007 | December 31, 2006 | ||||||||
(Unaudited) | |||||||||
FROM INVESTMENT ACTIVITIES: | |||||||||
Operations: | |||||||||
Net investment income | $ | 11,713,288 | $ | 6,791,148 | |||||
Net realized gains (losses) on investment transactions and futures | 6,291,312 | (775,929 | ) | ||||||
Net change in unrealized appreciation on investments and futures | 78,380,005 | 55,012,201 | |||||||
Change in net assets resulting from operations | 96,384,605 | 61,027,420 | |||||||
Distributions to Shareholders from: | |||||||||
Net investment income: | |||||||||
Class IV | (1,963,273 | ) | (4,357,979 | ) | |||||
Class ID | (9,163,663 | ) | (2,414,995 | ) | |||||
Change in net assets from shareholder distributions | (11,126,936 | ) | (6,772,974 | ) | |||||
Change in net assets from capital transactions | 1,762,256,035 | 233,511,386 | |||||||
Change in net assets | 1,847,513,704 | 287,765,832 | |||||||
Net Assets: | |||||||||
Beginning of period | 553,336,853 | 265,571,021 | |||||||
End of period | $ | 2,400,850,557 | $ | 553,336,853 | |||||
Accumulated net investment income at end of period | $ | 625,170 | $ | 38,818 | |||||
CAPITAL TRANSACTIONS: | |||||||||
Class IV Shares | |||||||||
Proceeds from shares issued | $ | 3,737,425 | $ | 9,503,803 | |||||
Dividends reinvested | 1,963,273 | 4,357,979 | |||||||
Cost of shares redeemed | (18,186,553 | ) | (42,352,251 | ) | |||||
(12,485,855 | ) | (28,490,469 | ) | ||||||
Class ID Shares | |||||||||
Proceeds from shares issued | 389,639,125 | 259,586,860 | (a) | ||||||
Proceeds from in-kind transactions | 1,387,369,746 | (a) | |||||||
Dividends reinvested | 9,163,461 | 2,414,995 | (a) | ||||||
Cost of shares redeemed | (11,430,442 | ) | (a) | ||||||
1,774,741,890 | 262,001,855 | ||||||||
Change in net assets from capital transactions | $ | 1,762,256,035 | $ | 233,511,386 | |||||
16
NVIT S&P 500 Index Fund | |||||||||
Six Months Ended | Year Ended | ||||||||
June 30, 2007 | December 31, 2006 | ||||||||
(Unaudited) | |||||||||
CAPITAL TRANSACTIONS: (continued) | |||||||||
SHARE TRANSACTIONS: | |||||||||
Class IV Shares | |||||||||
Issued | 368,075 | 1,041,694 | |||||||
Reinvested | 192,481 | 471,632 | |||||||
Redeemed | (1,786,261 | ) | (4,630,748 | ) | |||||
(1,225,705 | ) | (3,117,422 | ) | ||||||
Class ID Shares | |||||||||
Issued | 37,608,799 | 28,369,561 | (a) | ||||||
Proceeds from in-kind transactions | 137,091,872 | (a) | |||||||
Reinvested | 884,994 | 253,932 | (a) | ||||||
Redeemed | (1,088,611 | ) | (a) | ||||||
174,497,054 | 28,623,493 | ||||||||
Total change in shares | 173,271,349 | 25,506,071 | |||||||
(a) | For the period from May 1, 2006 (commencement of operations) through December 31, 2006. |
17
Distributions | Ratios / Supplemental Data | |||||||||||||||||||||||||||||||||||
Investment Activities | ||||||||||||||||||||||||||||||||||||
Net Realized | ||||||||||||||||||||||||||||||||||||
and | ||||||||||||||||||||||||||||||||||||
Net Asset | Unrealized | Total | Net Assets | |||||||||||||||||||||||||||||||||
Value, | Net | Gains | from | Net | Net Asset | at End of | ||||||||||||||||||||||||||||||
Beginning | Investment | (Losses) on | Investment | Investment | Total | Value, End | Total | Period | ||||||||||||||||||||||||||||
of Period | Income | Investments | Activities | Income | Distributions | of Period | Return (a) | (000s) | ||||||||||||||||||||||||||||
Class IV Shares | ||||||||||||||||||||||||||||||||||||
For the year ended December 31, 2002 | $ | 8.12 | $ | 0.10 | $ | (1.89 | ) | $ | (1.79 | ) | $ | (0.09 | ) | $ | (0.09 | ) | $ | 6.24 | (22.31% | ) | $ | 235,961 | ||||||||||||||
For the year ended December 31, 2003 (e) | $ | 6.24 | $ | 0.11 | $ | 1.63 | $ | 1.74 | $ | (0.13 | ) | $ | (0.13 | ) | $ | 7.85 | 28.33% | $ | 281,115 | |||||||||||||||||
For the year ended December 31, 2004 | $ | 7.85 | $ | 0.14 | $ | 0.68 | $ | 0.82 | $ | (0.22 | ) | $ | (0.22 | ) | $ | 8.45 | 10.59% | $ | 286,933 | |||||||||||||||||
For the year ended December 31, 2005 | $ | 8.45 | $ | 0.14 | $ | 0.26 | $ | 0.40 | $ | (0.14 | ) | $ | (0.14 | ) | $ | 8.71 | 4.75% | $ | 265,571 | |||||||||||||||||
For the year ended December 31, 2006 | $ | 8.71 | $ | 0.17 | $ | 1.15 | $ | 1.32 | $ | (0.15 | ) | $ | (0.15 | ) | $ | 9.88 | 15.32% | $ | 270,585 | |||||||||||||||||
For the six months ended June 30, 2007 (Unaudited) | $ | 9.88 | $ | 0.09 | $ | 0.57 | $ | 0.66 | $ | (0.07 | ) | $ | (0.07 | ) | $ | 10.47 | 6.74% | $ | 274,050 | |||||||||||||||||
Class ID Shares | ||||||||||||||||||||||||||||||||||||
For the year ended December 31, 2006 (f) (g) | $ | 9.15 | $ | 0.13 | $ | 0.72 | $ | 0.85 | $ | (0.12 | ) | $ | (0.12 | ) | $ | 9.88 | 9.42% | $ | 282,751 | |||||||||||||||||
For the six months ended June 30, 2007 (Unaudited) | $ | 9.88 | $ | 0.08 | $ | 0.59 | $ | 0.67 | $ | (0.08 | ) | $ | (0.08 | ) | $ | 10.47 | 6.79% | $ | 2,126,801 | |||||||||||||||||
[Additional columns below]
[Continued from above table, first column(s) repeated]
Ratios / Supplemental Data | ||||||||||||||||||||||
Ratio of Net | ||||||||||||||||||||||
Ratio | Ratio of | Investment | ||||||||||||||||||||
of Net | Expenses | Income | ||||||||||||||||||||
Ratio of | Investment | (Prior to | (Prior to | |||||||||||||||||||
Expenses | Income | Reimbursements) | Reimbursements) | |||||||||||||||||||
to Average | to Average | to Average | to Average | Portfolio | ||||||||||||||||||
Net Assets (b) | Net Assets (b) | Net Assets (b) (c) | Net Assets (b) (c) | Turnover (d) | ||||||||||||||||||
Class IV Shares | ||||||||||||||||||||||
For the year ended December 31, 2002 | 0.28% | 1.32% | 0.50% | 1.10% | 19.00% | |||||||||||||||||
For the year ended December 31, 2003 (e) | 0.28% | 1.51% | 0.47% | 1.32% | 2.41% | |||||||||||||||||
For the year ended December 31, 2004 | 0.28% | 1.74% | 0.43% | 1.59% | 3.10% | |||||||||||||||||
For the year ended December 31, 2005 | 0.28% | 1.58% | 0.47% | 1.40% | 4.29% | |||||||||||||||||
For the year ended December 31, 2006 | 0.31% | 1.80% | 0.38% | 1.73% | 5.40% | |||||||||||||||||
For the six months ended June 30, 2007 (Unaudited) | 0.32% | 1.80% | 0.32% | 1.80% | 1.31% | |||||||||||||||||
Class ID Shares | ||||||||||||||||||||||
For the year ended December 31, 2006 (f) (g) | 0.23% | 1.99% | 0.23% | 1.98% | 5.40% | |||||||||||||||||
For the six months ended June 30, 2007 (Unaudited) | 0.23% | 1.83% | 0.23% | 1.83% | 1.31% | |||||||||||||||||
(a) | Not annualized for periods less than one year. | |
(b) | Annualized for periods less than one year. | |
(c) | During the period, certain fees were waived and/or reimbursed. If such waivers/reimbursements had not occurred, the ratios would have been as indicated. | |
(d) | Portfolio turnover is calculated on the basis of the Fund as a whole without distinguishing among the classes of shares. | |
(e) | The NVIT S&P 500 Index Fund retained the history of Market Street Equity 500 Index Fund and the existing shares of the fund were designated Class IV Shares. | |
(f) | For the period from May 1, 2006 (commencement of operations) through December 31, 2006. | |
(g) | Net investment income (loss) is based on average shares outstanding during the period. |
See accompanying notes to financial statements.
1. Organization
Nationwide Variable Insurance Trust (“NVIT” or the “Trust”) is an open-end management investment company, organized under the laws of Delaware by an amended and restated Agreement and Declaration of Trust, dated October 28, 2004, as amended to date. Prior to May 1, 2007, the Trust was named “Gartmore Variable Insurance Trust”. The Trust, originally created under the laws of Massachusetts as a Massachusetts business trust pursuant to a Declaration of Trust dated, as of June 30, 1981, and as subsequently amended, redomesticated as a Delaware Statutory Trust after the close of trading on April 29, 2005, and is registered under the Investment Company Act of 1940, as amended (the “1940 Act”). The redomestication was a change in statutory status and did not affect the operations of the Trust. As of June 30, 2007, the Trust had authorized an unlimited number of shares of beneficial interest, without par value (“shares”). The Trust currently offers shares to life insurance company separate accounts to fund the benefits under variable life insurance or annuity policies. To date, only the separate accounts of Nationwide Life Insurance Company and Nationwide Life and Annuity Insurance Company (collectively, “Nationwide”) have purchased shares of the NVIT S&P 500 Index Fund (the “Fund”), (formerly, “GVIT S&P 500 Index Fund”). The Trust currently operates forty (40) separate series, or mutual funds, each with its own investment objectives and strategies. This report contains the financial statements and financial highlights of the Fund.
2. Summary of Significant Accounting Policies
The following is a summary of significant accounting policies followed by the Fund in the preparation of its financial statements. The policies are in conformity with accounting principles generally accepted in the United States of America (“GAAP”). The preparation of financial statements requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of income and expenses for the period. Actual results could differ from those estimates.
(a) | Security Valuation |
Securities for which market quotations are readily available are valued at current market value as of “Valuation Time.” Valuation Time is as of the close of regular trading on the New York Stock Exchange (usually 4 p.m. Eastern time). Equity securities are valued at the last quoted sale price or, if there is no sale price, the last quoted bid price provided by an independent pricing service approved by the Trust’s Board of Trustees (“Board of Trustees”). Securities traded on NASDAQ are valued at the NASDAQ official closing price. Prices are taken from the primary market or exchange in which each security trades. | |
Most securities listed on a foreign exchange are valued either at fair value (see description below) or at the last sale price at the close of the exchange on which the security is principally traded. Foreign securities, currencies, and other assets and liabilities denominated in foreign currencies are translated into U.S. dollars at the exchange rate of said currencies against the U.S. dollar, as of Valuation Time, as provided by an independent pricing service approved by the Board of Trustees. | |
Securities for which market quotations are not readily available, or for which an independent pricing service does not provide a value or provides a value that does not represent fair value in the judgment of the Fund’s investment adviser or designee, are valued at fair value under procedures approved by the Board of Trustees. The “Fair Value” of these securities is determined in good faith by taking into account relevant factors and surrounding circumstances. Methods utilized to obtain a “Fair Value” may include the following non-exclusive list of acceptable methods: (i) a multiple of earnings; (ii) the discount from market value of a similar, freely traded security; (iii) the yield-to-maturity for debt issues; or (iv) a consolidation of the methods. The Trust’s Valuation & Operations Committee considers a non-exclusive list of factors to arrive at the appropriate method of determining “Fair Value.” For example, fair value determinations are required for securities whose value is affected by a “significant” event that materially affects the value of a domestic or foreign security which occurs subsequent to the time of the close of the principal market on which such domestic or foreign security trades and before the Valuation Time (i.e., a “subsequent event”). Typically, |
this will involve events occurring after the close of a foreign market on which a security trades and before the next Valuation Time. | |
The Fund values foreign securities at fair value in the circumstances described below. Generally, trading in foreign securities markets is completed each day at various times prior to the Valuation Time. Due to the time differences between the closings of the relevant foreign securities exchanges and the Valuation Time for the Fund, the Fund will fair value its foreign investments when it is determined that the market quotations for the foreign investments either are not readily available or are unreliable and, therefore, do not represent fair value. When the fair value prices are utilized, these prices will attempt to reflect the impact of the U.S. financial markets’ perceptions and trading activities on the Fund’s foreign investments since the last closing prices of the foreign investments were calculated on their primary foreign securities markets or exchanges. For these purposes, the Board of Trustees has determined that movements in relevant indices or other appropriate market indicators, after the close of the foreign securities exchanges, may demonstrate that market quotations are unreliable, and may trigger fair value pricing for certain securities. Consequently, fair valuation of portfolio securities may occur on a daily basis. |
(b) | Repurchase Agreements |
The Fund may enter into repurchase agreements with an entity which is a member of the Federal Reserve System or which is a “primary dealer” (as designated by the Federal Reserve Bank of New York) in U.S. Government obligations. The repurchase price generally equals the price paid by the Fund plus interest negotiated on the basis of current short-term rates, which may be more or less than the rate on the underlying portfolio securities. The seller under a repurchase agreement is required to maintain the value of the collateral held pursuant to the agreement at a market value equal to or greater than the repurchase price (including accrued interest). Collateral subject to repurchase agreements is held by the Fund’s custodian or another qualified sub-custodian or in the Federal Reserve/ Treasury book-entry system. If the counterparty defaults and the fair value of the collateral declines, realization of the collateral by the Fund may be delayed or limited. The Fund may transfer uninvested cash balances into a pooled cash account. These balances are invested in one or more repurchase agreements, with the counterparty of Nomura Securities, which is fully collateralized by U.S. Government Agency Mortgages. |
(c) | Foreign Currency Transactions |
The accounting records of the Fund are maintained in U.S. dollars. Foreign currency amounts are translated into U.S. dollars at the current rate of exchange to determine the value of investments, assets and liabilities. The Fund may enter into foreign currency contracts in connection with purchases or sales of securities denominated in a foreign currency. Purchases and sales of securities, and income and expenses, are translated at the prevailing rate of exchange on the respective date of these transactions. The Fund does not isolate that portion of the results of operations resulting from changes in foreign exchange rates on investments from fluctuations arising from changes in market prices of securities held. These fluctuations are included with the net realized and unrealized gain or loss from investments and foreign currencies. |
(d) | Forward Foreign Currency Contracts |
The Fund may enter into forward foreign currency contracts in connection with planned purchases or sales of securities or to hedge the U.S. dollar value of portfolio securities denominated in a particular currency. The Fund could be exposed to risks if the counterparties to the contracts are unable to meet the terms of their contracts and from unanticipated movements in the value of a foreign currency relative to the U.S. dollar. Forward foreign currency contracts are valued at the current cost of covering these contracts, as provided by an independent pricing service approved by the Board of Trustees. The forward foreign currency contracts are adjusted by the daily exchange rate of the underlying currency and any gains or losses are recorded for financial statement purposes as unrealized gains or losses until the contract settlement date. |
(e) | Futures Contracts |
The Fund may invest in financial futures contracts (“futures contracts”) for the purpose of hedging its existing portfolio securities or securities that the Fund intends to purchase against fluctuations in value caused by changes in prevailing market interest rates or prices. Futures contracts may also be entered into for non-hedging purposes. | |
Upon entering into a futures contract, the Fund is required to pledge to the broker an amount of cash and/or other assets equal to a certain percentage of the contract amount (initial margin deposit). Subsequent payments, known as “variation margin,” are made each day, depending on the daily fluctuations in the fair value/market value of the underlying assets. A gain or loss equal to the daily variation margin is recognized on a daily basis. Futures contracts are valued daily at their last quoted sale price. | |
A “sale” of a futures contract means the creation of a contractual obligation to deliver the securities or foreign currency called for by the contract at a fixed price at a specified time in the future. A “purchase” of a futures contract means the creation of a contractual obligation to acquire the securities or foreign currency at a fixed price at a specified time in the future. | |
Should market conditions change unexpectedly, the Fund may not achieve the anticipated benefits of the futures contracts and may realize a loss. The use of futures transactions for hedging purposes involves the risk of imperfect correlation in movements in the price of futures contracts, interest rates, and the value of the underlying hedged assets. |
(f) | Written Options Contracts |
The Fund may write options contracts. A written option obligates the Fund to deliver (written call) or to receive (written put) a specified quantity of an underlying asset at the contract amount upon exercise by the holder of the option. When the Fund writes an option, an amount equal to the premium received by the Fund is recorded as a liability and is subsequently adjusted to the current fair value of the option written. Premiums received from writing options that expire unexercised are treated by the Fund on the expiration date as realized gains from investments. The difference between the premium and the amount paid on effecting a closing purchase transaction, as a realized loss. If a call option is exercised, the premium is added to the proceeds from the sale of the underlying security or currency in determining whether the Fund has realized a gain or loss. If a put option is exercised, the premium reduces the cost basis of the securities purchased by the Fund. Options traded on an exchange are valued at the last quoted sale price, or in the absence of a sale, the bid price provided by an independent pricing service approved by the Board of Trustees. Non-exchange traded options are valued using dealer supplied quotes. The Fund as a writer of an option bears the market risk of an unfavorable change in the price of the security underlying the written option. |
(g) | Short Sales |
The Fund is authorized to engage in short-selling of portfolio securities which obligates the Fund to replace any security that the Fund has borrowed by purchasing the security at current market value sometime in the future. The Fund will incur a loss if the price of the security increases between the date of the short sale and the date on which the Fund replaces the borrowed security. The Fund generally will realize a gain if the price of the security declines between these dates. Until the Fund replaces the borrowed security, the Fund will maintain a segregated account with cash, U.S. Government securities and/or securities held long to sufficiently cover the Fund’s short position on a daily basis. Dividends declared on securities sold short are recorded as an expense on the ex-dividend date and paid to the counterparty on the dividend pay date. |
(h) | Security Transactions and Investment Income |
Security transactions are accounted for on the date the security is purchased or sold (“trade date”). Securities gains and losses are calculated on the identified cost basis. Interest income is recognized on the accrual basis and includes, where applicable, the amortization or accretion of premium or discount. Dividend income is recorded on the ex-dividend date. |
(i) | Securities Lending |
To generate additional income, the Fund may lend its portfolio securities, up to 33 1/3% of the Fund, to brokers, dealers and other financial institutions provided that (1) the borrower delivers cash or securities as collateral with respect to each new loan of U.S. securities, equal to at least 102% of the value of the portfolio securities loaned, and with respect to each new loan on non-U.S. securities, collateral of at least 105% of the value of the portfolio securities loaned; and (2) at all times thereafter shall require the borrower to mark-to-market the collateral on a daily basis so that the market value of such collateral does not fall below 100% of the value of securities loaned. The Fund receives payments from borrowers equivalent to the dividends and interest that would have been earned on securities loaned while simultaneously seeking to earn income on the investment of cash collateral. There may be risks of delay in recovery of the securities should the borrower of the securities fail financially. Loans will be made, however, only to borrowers deemed by the Fund’s investment adviser to be of good standing and creditworthy under guidelines established by the Board of Trustees and when, in judgment of the adviser, the consideration which can be earned currently from these securities loans justifies the attendant risks. Loans are subject to termination by the Fund or the borrower at any time, and, therefore, are not considered to be illiquid investments. JPMorgan Chase Bank serves as custodian for the securities lending program of the Fund. JPMorgan Chase Bank receives a fee based on the value of the collateral received from borrowers. | |
Information on the investment of cash collateral is shown in the Statement of Investments. | |
As of June 30, 2007, the Fund had securities with the following value on loan: |
Value of | Value of | |||||
Loaned Securities | Collateral | |||||
$ | 83,796,115 | $ | 85,492,539 | |||
(j) | Distributions to Shareholders |
The Fund’s dividends from net investment income, if any, are declared and paid quarterly. The Fund’s distributions from net realized capital gains, if any, are declared and distributed at least annually. | |
Dividends and distributions to shareholders are determined in accordance with federal income tax regulations, which may differ from GAAP. These “book/tax” differences are considered either permanent or temporary in nature. In accordance with the American Institute of Certified Public Accountants Statement of Position 93-2, permanent differences (i.e., reclassification of market discounts, foreign exchange gain/loss, paydowns, and distributions from real estate investment trusts) are reclassified within the capital accounts based on their nature for federal income tax purposes; temporary differences do not require reclassification. These reclassifications have no effect upon the net asset value of the Fund. To the extent distributions exceed current and accumulated earnings and profits for federal income tax purposes, these distributions are reported as distributions of paid-in-capital. |
(k) | Federal Income Taxes |
It is the policy of the Fund to qualify or to continue to qualify as a “regulated investment company” by complying with the provisions available to certain investment companies, as defined in Subchapter M of the U.S. Internal Revenue Code, and to make distributions of net investment income and net realized capital gains sufficient to relieve the Fund from all, or substantially all, federal income taxes. |
As of June 30, 2007, the tax cost of securities and the breakdown of unrealized appreciation (depreciation) for the Fund was as follows: |
Net | ||||||||||||||
Unrealized | ||||||||||||||
Tax Cost of | Unrealized | Unrealized | Appreciation | |||||||||||
Securities | Appreciation | Depreciation | (Depreciation) | |||||||||||
$2,376,908,301 | $141,586,909 | $(33,853,016) | $107,733,893 | |||||||||||
(l) | Allocation of Expenses, Income, and Gains and Losses |
Expenses directly attributable to the Fund are charged to the Fund. Expenses not directly attributable to the Fund are allocated proportionately among various or all funds within the Trust. The method used by the Fund for allocating income, fund level expenses, and realized and unrealized gains or losses is based on the fair value of shares outstanding relative to net assets. Under this method, each class of shares participates based on the total net asset value of that class’s shares in proportion to the total net assets of the Fund. Expenses specific to a class (such as Rule 12b-1 and administrative services fees) are charged to that class. |
3. Transactions with Affiliates
Under the terms of the Trust’s Investment Advisory Agreement, Nationwide Fund Advisors (formerly, Gartmore Mutual Fund Capital Trust (“GMF”)) (“NFA” or the “Advisor”) manages the investment of the assets and supervises the daily business affairs of the Fund. NFA is a wholly-owned subsidiary of Nationwide Financial Services (“NFS”). In addition, NFA provides investment management evaluation services in initially selecting and monitoring, on an ongoing basis, the performance of the subadviser for the Fund. BlackRock Investment Management, LLC (the “subadviser”) manages all of the Fund’s investments and has the responsibility for making all investment decisions for the Fund.
Under the terms of the Investment Advisory Agreement, the Fund pays NFA an investment advisory fee based on that Fund’s average daily net assets. Additional information regarding investment advisory fees and subadvisory fees for NFA and the subadviser is as follows for the six months ended June 30, 2007:
Total | ||||||
Fee Schedule | Fees | |||||
Up to $1.5 billion | 0.13% | |||||
Next $1.5 billion | 0.12% | |||||
$3 billion or more | 0.11% | |||||
From such fees, pursuant to the subadvisory agreement, NFA paid the subadviser $120,906 for the six months ended June 30, 2007.
Effective May 1, 2007 NFA and the Fund have entered into a written contract (“Expense Limitation Agreement”) that limits operating expenses (excluding any taxes, interest, brokerage fees, Rule 12b-1 fees, short-sale dividend expenses, administrative services fees, other expenses which are capitalized in accordance with generally accepted accounting principles and may exclude other non-routine expenses not incurred in the ordinary course of the Fund’s business) from exceeding 0.23% for all classes of shares until at least May 1, 2008.
NFA may request and receive reimbursement from the Fund of the advisory fees waived and other expenses reimbursed by NFA, respectively, pursuant to the Expense Limitation Agreement at a later date not to exceed three years from the fiscal year in which the corresponding reimbursement to the Fund was made, depending on the fund (as described below), if the Fund has reached a sufficient asset size to permit reimbursement to be made without causing the total annual operating expense ratio of the Fund to exceed the limits set forth above. No reimbursement will be made unless: (i) the Fund’s assets exceed $100 million; (ii) the total annual expense ratio of the Class making such reimbursement is less than the limit set forth above; and (iii) the payment of such reimbursement is approved by the Board of Trustees on a
As of June 30, 2007, the cumulative potential reimbursements for the Fund, based on reimbursements which expire within three years from the fiscal year in which the corresponding reimbursement to the Fund was made for expenses reimbursed by NFA would be:
Amount Fiscal Year 2004 | Amount Fiscal Year 2005 | Amount Fiscal Year 2006 | ||||||||||||
$ | 414,515 | $ | 500,657 | $ | 209,099 | |||||||||
Under the terms of a Fund Administration and Transfer Agency Agreement, Nationwide Fund Management, LLC (formerly, Gartmore Investor Services, Inc. (“GISI”)) (“NFM”), a wholly-owned subsidiary of NFS Distributors, Inc. (“NFSDI”), provides the Fund with various administrative and accounting services for the Fund (prior to May 1, 2007, this service was provided by Gartmore SA Capital Trust (“GSA”)), and serves as Transfer and Dividend Disbursing Agent for the Fund (prior to May 1, 2007, this service was provided by GISI, an indirect subsidiary of GSA.) The fees for the services provided under this Agreement are calculated based on the Trust’s average daily net assets according to the fee schedule below. The fees are then allocated proportionately among all funds within the Trust in relation to the average daily net assets of each fund and are paid to NFA. NFA pays NFM from these fees for NFM’s services.
Combined Fee Schedule* | ||||||
Up to $1 billion | 0.15% | |||||
$1 billion up to $3 billion | 0.10% | |||||
$3 billion up to $8 billion | 0.05% | |||||
$8 billion up to $10 billion | 0.04% | |||||
$10 billion up to $12 billion | 0.02% | |||||
$12 billion or more | 0.01% | |||||
* | The assets of the Nationwide NVIT Investor Destinations Aggressive Fund, the Nationwide NVIT Investor Destinations Moderately Aggressive Fund, the Nationwide NVIT Investor Destinations Moderate Fund, the Nationwide NVIT Investor Destinations Moderately Conservative Fund, and the Nationwide NVIT Investor Destinations Conservative Fund (collectively, the “Investor Destinations Funds”) are excluded from the Trust asset level amount in order to calculate this asset-based fee. The Investor Destinations Funds do not pay any part of this fee. |
NFA and NFM have entered into agreements with Citi Fund Services Ohio, Inc. (“Citi”), pursuant to which Citi provides sub-administration and sub-transfer agency services, respectively, to the Fund. Effective August 1, 2007, the BISYS Group Inc. was acquired by and became a wholly owned subsidiary of Citi.
Under the terms of an Administrative Services Plan, the Fund may pay fees to servicing organizations, such as broker-dealers, including NFS, and financial institutions, which agree to provide administrative support services to the shareholders of certain classes. These services include, but are not limited, to the following: establishing and maintaining shareholder accounts; processing purchase and redemption transactions; arranging bank wires; performing shareholder sub-accounting; answering inquires regarding the Fund; and other such services. These fees are based on an annual rate of up to 0.20% of Class IV shares of the Fund.
For the six months ended June 30, 2007, NFS received $150,863 in Administrative Services Fees from the Fund.
Under the terms of a letter agreement dated September 12, 2006, by and among NFA, the Audit Committee of the Trust and the Trust, the Trust has agreed to reimburse NFA certain costs related to the Fund’s portion of ongoing administration, monitoring and annual (audit) testing of the Trust’s Rule 38a-1 Compliance Program subject to the pre-approval of the Trust’s Audit Committee. For the period ended June 30, 2007, the Fund’s portion of such costs amounted to $6,122.
4. Investment Transactions
For the six months ended June 30, 2007, (excluding short-term securities) the Fund had purchases of $425,390,202 and sales of $16,223,061.
5. Bank Loans and Earnings Credit
The Trust has a credit agreement with JPMorgan Chase & Co., the Fund’s custodian bank, permitting the Trust to borrow up to $100,000,000. Borrowings under this arrangement bear interest at the Federal Funds rate plus 0.50%. The interest costs, if any, would be included in other fees in the Statement of Operations. No compensating balances were required under the terms of the line of credit. The line of credit is renewed annually, expiring on June 25, 2008, with a commitment fee of 0.07% per year on $100,000,000. There were no borrowings outstanding under this line of credit for the six months ended June 30, 2007.
The Trust’s custodian bank has agreed to reduce the bank’s fees (earnings credit) when the funds of the Trust maintain cash on deposit in non-interest-bearing custody and Demand Deposit Accounts. Earnings credits are shown as a reduction of total expenses on the Statement of Operations.
6. Portfolio Investment Risks
Risks Associated with Foreign Securities and Currencies. Investments in securities of foreign issuers carry certain risks not ordinarily associated with investments in securities of U.S. issuers. These risks include future political and economic developments, and the possible imposition of exchange controls or other foreign governmental laws and restrictions. In addition, with respect to certain countries, there is the possibility of expropriation of assets, confiscatory taxation, political or social instability, or diplomatic developments, which could adversely affect investments in those countries.
Certain countries also may impose substantial restrictions on investments in their capital markets by foreign entities, including restrictions on investments in issuers of industries deemed sensitive to relevant national interests. These factors may limit the investment opportunities available and result in a lack of liquidity and high price volatility with respect to securities of issuers from developing countries.
7. Indemnifications
Under the Trust’s organizational documents, certain of the Trust’s Officers and Trustees are indemnified against certain liabilities arising out of the performance of their duties to the Trust. In addition, the Trust has entered into Indemnification Agreements with the Trust’s trustees and certain officers covering similar liabilities. Trust Officers receive no compensation from the Trust for serving as the Trust’s Officers. In addition, in the normal course of business, the Trust enters into contracts with its vendors and others that provide for general indemnifications. The Trust’s maximum exposure under these arrangements is unknown, as this would involve future claims that may be made against the Trust. Based on experience, however, the Trust expects that risk of loss to be remote.
8. Recently Issued Accounting Pronouncements
On July 13, 2006, the Financial Accounting Standards Board (“FASB”) released FASB Interpretation No. 48, Accounting for Uncertainty in Income Taxes (“FIN 48”). FIN 48 provides guidance for how uncertain tax positions should be recognized, measured, presented and disclosed in the financial statements. FIN 48 requires the affirmative evaluation of tax positions taken or expected to be taken in the course of preparing the Fund’s tax returns to determine whether it is more-likely-than-not (i.e., greater than 50 percent) that each tax position will be sustained upon examination by a taxing authority based on the technical merits of the position. A tax position that meets the more-likely-than-not recognition threshold is measured to determine the amount of benefit to recognize in the financial statements. Differences between tax positions taken in a tax return and amounts recognized in the financial statements will generally result in an increase in a liability for taxes payable (or a reduction of a tax refund receivable) and an increase in a deferred tax liability (or a reduction in a deferred tax asset). Adoption of FIN 48 was required no later than the last business day of the first financial statement reporting period for fiscal years beginning after December 15, 2006 and is to be applied to all open
In September 2006, the FASB issued Statement on Financial Accounting Standards (“SFAS”) No. 157, “Fair Value Measurements.” This standard establishes a single authoritative definition of fair value, sets out a framework for measuring fair value and requires additional disclosures about fair value measurements. SFAS No. 157 applies to fair value measurements already required or permitted by existing standards. SFAS No. 157 is effective for financial statements issued for fiscal years beginning after November 15, 2007 and interim periods within those fiscal years. The changes to current accounting principles generally accepted in the United States of America from the application of this Statement relate to the definition of fair value, the methods used to measure fair value, and the expanded disclosures about fair value measurements. As of June 30, 2007, the Fund does not believe the adoption of SFAS No. 157 will impact the financial statement amounts; however, additional disclosures may be required about the inputs used to develop the measurements and the effect of certain of the measurements on changes in net assets for the period.
Trustees who are not Interested Persons (as defined in the 1940 Act) and Officers of the Trust as of
Number of Portfolios | ||||||||||
Position(s) Held | in the | |||||||||
with the Trust | Principal Occupation(s) | Nationwide Fund | Other | |||||||
Name, Address | and Length of | During Past | Complex Overseen | Directorships | ||||||
and Year of Birth | Time Served1 | Five Years | by Trustee | Held by Trustee2 | ||||||
Charles E. Allen c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1948 | Trustee since July 2000 | Mr. Allen is Chairman, Chief Executive Officer and President of Graimark Realty Advisors, Inc. (real estate development, investment and asset management). | 89 | None | ||||||
Paula H.J. Cholmondeley c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1947 | Trustee since July 2000 | Ms. Cholmondeley was Vice President and General Manager of Sappi Fine Paper North America from April 2000 through December 2003. | 89 | Director of Dentsply International, Inc. (dental products), Ultralife Batteries, Inc., Terex Corporation (construction equipment), Minerals Technology, Inc. (specialty chemicals) and Albany International Corp. (paper industry) | ||||||
C. Brent DeVore3 c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1940 | Trustee since 1990 | Dr. DeVore is President of Otterbein College. | 89 | None | ||||||
Phyllis Kay Dryden c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1947 | Trustee since December 2004 | Ms. Dryden was a partner of Mitchell Madison, a management consulting company from January 2006 until December 2006; she is currently a consultant with the company. Ms. Dryden was formerly Managing Partner of march FIRST, a global management consulting firm. | 89 | None | ||||||
Barbara L. Hennigar c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1935 | Trustee since July 2000 | Retired. | 89 | None | ||||||
Number of Portfolios | ||||||||||
Position(s) Held | in the | |||||||||
with the Trust | Principal Occupation(s) | Nationwide Fund | Other | |||||||
Name, Address | and Length of | During Past | Complex Overseen | Directorships | ||||||
and Year of Birth | Time Served1 | Five Years | by Trustee | Held by Trustee2 | ||||||
Barbara I. Jacobs c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1950 | Trustee since December 2004 | Ms. Jacobs served as Chairman of the Board of Directors of KICAP Network Fund, a European (United Kingdom) hedge fund, from January 2001 through January 2006. From 1998-2003, Ms. Jacobs was also a Managing Director and European Portfolio Manager of CREF Investments (Teachers Insurance and Annuity Association-College Retirement Equities Fund). | 89 | None | ||||||
Douglas F. Kridler c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1955 | Trustee since September 1997 | Mr. Kridler has served as the President and Chief Executive Officer of the Columbus Foundation (a Columbus, OH-based foundation which manages over 1,300 individual endowment funds) since February 2002. Prior to January 31, 2002, Mr. Kridler was the President of the Columbus Association for the Performing Arts and Chairman of the Greater Columbus Convention and Visitors Bureau. | 89 | None | ||||||
Michael D. McCarthy c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1947 | Trustee since December 2004 | Retired. Mr. McCarthy was Chairman of VMAC (commodity swaps) from October 2002 until January 2007; and a partner of Pineville Properties LLC (a commercial real estate development firm) from September 2000 until January 2007. | 89 | None | ||||||
David C. Wetmore c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1948 | Trustee since 1995 and Chairman since February 2005 | Retired. | 89 | None | ||||||
1 | Length of time served includes time served with the Trust’s predecessors. | |
2 | Directorships held in (1) any other investment companies registered under the 1940 Act, (2) any company with a class of securities registered pursuant to Section 12 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or (3) any company subject to the requirements of Section 15(d) of the Exchange Act. | |
3 | Mr. DeVore has served as President of Otterbein College since 1984. Mark Thresher, President and Chief Operating Officer of Nationwide Financial Services, Inc. (“NFS”) has served as a member of the Board of Trustees of Otterbein College since 2000, currently serves as one of 30 of its trustees, and is currently one of two Vice Chairmen of the Board. Each of Nationwide Fund Advisors (“NFA”), the Funds’ investment adviser, and Nationwide Fund Distributors LLC (“NFD”), principal underwriter to the Trust, is a wholly-owned subsidiary of NFS. | |
Additional information regarding the Trustees and Officers may be found in the Trust’s Statement of Additional Information, which is available without charge upon request, by calling 800-848-0920. |
Trustees who are Interested Persons (as defined in the 1940 Act) and/or Officers of the Trust as of
Number of Portfolios | ||||||||||
Position(s) Held | in the | |||||||||
with the Trust | Principal Occupation(s) | Nationwide Fund | Other | |||||||
Name, Address | and Length of | During Past | Complex Overseen | Directorships | ||||||
and Year of Birth | Time Served1 | 5 Years | by Trustee | Held by Trustee 2 | ||||||
Arden L. Shisler c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1941 | Trustee since February 2000 | Retired. Mr. Shisler is the former President and Chief Executive Officer of KeB Transport, Inc., a trucking firm (2000 through 2002). He served as a consultant to KeB from January 2003 through December 2004. Since 1992, Mr. Shisler has also been Chairman of the Board for Nationwide Mutual Insurance Company.3 | 89 | Director of Nationwide Financial Services, Inc., Chairman of Nationwide Mutual Insurance Company3 | ||||||
John H. Grady Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1961 | President & Chief Executive Officer since December 2006 | Mr. Grady is President, and Chief Executive Officer of Nationwide Funds Group which includes Nationwide Fund Advisors,3 Nationwide Fund Management LLC,3 Nationwide Fund Distributors LLC 3 and NWD Investments,2 the asset management operations of Nationwide Mutual Insurance Company, which includes Morley Capital Management, Inc.,2 Nationwide Separate Accounts LLC,2 NorthPointe Capital LLC,2 and Nationwide SA Capital Trust2. From March 2004 until March 2006, Mr. Grady was Chief Executive Officer of Constellation Investment Management Co., L.P. (registered investment adviser), and President and Chief Executive Officer of Constellation Funds Group (registered investment companies). He also was President of Constellation Investment Distribution Co., Inc. (registered broker-dealer) from March 2004 until June 2006. From February 2001 until February 2004, Mr. Grady was Chief Operating and Chief Legal Officer; Managing Director, Mutual Funds Group, Turner Investment Partners, Inc. (registered investment adviser); Executive Vice President of Turner Funds and Turner Institutional Portfolios (registered investment companies); and President, Turner Investment Distributors, Inc. (registered broker-dealer). | N/A | None | ||||||
Gerald J. Holland Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1951 | Treasurer since March 2001 | Mr. Holland is Senior Vice President—Operations for Nationwide Funds Group3. | N/A | N/A | ||||||
Number of Portfolios | ||||||||||
Position(s) Held | in the | |||||||||
with the Trust | Principal Occupation(s) | Nationwide Fund | Other | |||||||
Name, Address | and Length of | During Past | Complex Overseen | Directorships | ||||||
and Year of Birth | Time Served1 | 5 Years | by Trustee | Held by Trustee 2 | ||||||
Michael A. Krulikowski Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1959 | Chief Compliance Officer from June 2004 to August 20074 | Mr. Krulikowski is Vice President and Chief Compliance Officer of Nationwide Funds Group3, Morley Capital Management, Inc.3, Nationwide SA Capital Trust (since 1999)3, and Nationwide Separate Accounts LLC (since August 2005).3 Since June 2004, Mr. Krulikowski has also served as Chief Compliance Officer of the Trust. From November 1999 through May 2007, he served as Vice President and Chief Compliance Officer of NorthPointe Capital LLC. 3 | N/A | N/A | ||||||
Eric E. Miller Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1953 | Secretary since December 2002 | Mr. Miller is Senior Vice President, General Counsel, and Assistant Secretary for Nationwide Funds Group3 and NWD Investments.2 From August 2000 to August 2002, Mr. Miller was a Partner with Stradley Ronon Stevens & Young, LLP. | N/A | N/A | ||||||
1 | Length of time served includes time served with the Trust’s predecessors. | |
2 | Directorships held in (1) any other investment companies registered under the 1940 Act, (2) any company with a class of securities registered pursuant to Section 12 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or (3) any company subject to the requirements of Section 15(d) of the Exchange Act. | |
3 | This position is held with an affiliated person or principal underwriter of the Trust. | |
4 | Effective August 3, 2007, the Board of Trustees approved Carol Baldwin Moody as Chief Compliance Officer of the Trust. Since November 2005, Ms. Moody has been Senior Vice President, Chief Compliance Officer of Nationwide Financial Services, Nationwide Life Insurance Company, Nationwide Life and Annuity Insurance Company, and Nationwide Investment Advisors, LLC. From February 2004-November 2005, she was Chief Compliance Officer of TIAA-CREF and from April 2000-February 2004, she was Managing Director and General Counsel, TCW/ Latin America Partners, LLC and Baeza & Co., LLC. | |
Federal law requires the Trust, each of its investment advisers and sub-advisers to adopt procedures for voting proxies (“Proxy Voting Guidelines”) and to provide a summary of those Proxy Voting Guidelines used to vote the securities held by the Funds. The Funds’ proxy voting policies and procedures are available without charge (i) upon request, by calling 800-848-0920, (ii) on the Funds’ website at www.nationwidefunds.com, or (iii) on the Securities and Exchange Commission’s website at www.sec.gov. |
A. Renewal of Investment Advisory Agreement
(i) | General Information Regarding the Board’s Review of Investment Advisory Agreements |
The Trust’s investment advisory agreements (each an “Advisory Agreement”) with its investment adviser and, as applicable, sub-advisers (together, the “Adviser”) must be approved for an initial term no greater than two years, and renewed at least annually thereafter, (i) by the vote of the Trustees or by a vote of the shareholders of each series or fund of the Trust (individually a “Fund” ), and (ii) by the vote of a majority of the Trustees who are not parties to the Advisory Agreement or “interested persons” of any party thereto (the “Independent Trustees”) cast in person at a meeting called for the purpose of voting on such approval.
The Board meets quarterly and takes into account throughout the year matters bearing on each Fund’s Advisory Agreement. The Board and its standing committees consider at each meeting factors that are relevant to the annual renewal of an Advisory Agreement, including the services and support provided to a Fund and its shareholders.
On December 6, 2006, the Independent Trustees first met in person with their independent legal counsel (“Independent Legal Counsel”) to consider information provided by the Adviser and others to assist the Trustees in considering whether to renew each Fund’s Advisory Agreement for a one year term beginning May 1, 2007. Immediately following such meeting of the Independent Trustees, all Trustees met in person with the Adviser, Trust counsel, Independent Legal Counsel and others to consider such matters, and give preliminary consideration to information bearing on continuation of each Advisory Agreement. The primary purpose of the December 6 and 7, 2006 meeting was to ensure that the Trustees had ample opportunity to consider matters they deemed relevant in considering the continuation of an Advisory Agreement, and to request any additional information they considered reasonably necessary to their deliberations.
In preparation for the December 6 and 7, 2006 meeting the Trustees were provided, at the request of the Trustees, with a wide range of information to assist in their deliberations, including (i) reports from Lipper Inc. describing a Fund’s (a) performance rankings (where “first quintile” denotes the best performance) (over multiple years ended September 30, 2006) compared with performance groups and performance universes created by Lipper (and in some cases, customized peer groups created by the Adviser) of similar or peer group funds, and (b) expense rankings (where “first quintile” denotes the lowest fees and expenses) comparing the Fund’s contractual advisory fee and total expenses with expense groups and expense universes created by Lipper of similar or peer group funds, (ii) information from the Adviser describing the Fund’s performance (over multiple years ended September 30, 2006) compared with its benchmark and Lipper categories, (iii) for Funds under “close review,” copies of letters from the Adviser to the portfolio manager of each such Fund, together with the portfolio manager’s written response describing the reasons for the Fund’s underperformance (iv) information from the Adviser describing performance for the months of October and November, 2006, and annual performance for the year ended November 30, 2006, (v) reports from the Adviser describing the Adviser’s profitability in providing services under an Advisory Agreement, together with an explanation of Adviser’s methodology in calculating its profitability, (vi) information from the Adviser describing any fees paid to the Adviser for managing similar, non-affiliated institutional accounts, including the range of fee levels for such accounts, and (vii) information from the Adviser describing ancillary benefits, in addition to fees for serving as investment adviser, derived by the Adviser as a result of being investment adviser for a Fund, including, where applicable, information on soft-dollar benefits and fees inuring to the Adviser’s affiliates for serving as the Trust’s administrator, fund accountant and transfer agent.
At the December 6 and 7, 2006 meeting, the Trustees reviewed, considered and discussed, among themselves and with the Adviser, Trust counsel and Independent Legal Counsel, among other things, the information described above, and: (i) the nature, extent and quality of services provided by the Adviser under each Advisory Agreement, (ii) the investment performance of each Fund and the Adviser, (iii) the costs of the services provided by the Adviser under the Advisory Agreement and the profits realized by the Adviser thereunder, (iv) the extent to which economies of scale may be present and, if so, whether they are being shared with a Fund’s shareholders, (v) comparisons of the Adviser’s fees under the Advisory Agreement with investment advisory fees paid by peer group funds to their investment advisers and paid by non-affiliated institutional clients to the Adviser for managing similar accounts, and (vi) any ancillary benefits inuring to the Adviser and its affiliates as a result of being investment adviser for the Trust. The Trustees also considered, where
As part of the December 6 and 7, 2006 Board meeting, the Independent Trustees developed a list of follow-up matters and questions and asked that Adviser respond to such matters and questions at the contract approval meeting of the Board of Trustees to be held on January 11, 2007.
At the January 11, 2007 meeting of the Board of Trustees of the Trust, the Board received and considered information provided by the Adviser in follow-up from the December 6 and 7, 2006 Board meeting and, after consulting among themselves, and with the Adviser, Trust counsel and Independent Legal Counsel, concluded unanimously to renew the Advisory Agreement for the reasons set forth in the following section. In determining whether to renew the Advisory Agreement for the Fund, the Board ultimately reached a determination, with the assistance of Trust counsel and Independent Legal Counsel, that the renewal of the Advisory Agreement and the compensation to be received by the Adviser under the Advisory Agreement is consistent with the Board’s fiduciary duty under applicable law.
(ii) | Board Conclusions Regarding the Fund’s Advisory Agreement |
The Board considered that the Fund had underperformed its benchmark, the S&P 500 Index, for the one-, three-, and five-year periods, but performed in line with the benchmark on a gross basis. The Board also considered that the performance of the Fund’s Class IV shares had ranked in the first quintile of its Lipper-constructed Performance Group over the one-, two-, three-, four-, and five-year periods. The Board found that the Fund’s performance compared to its peer group has been very strong for all periods considered. Based on its review, and giving particular weight to the nature and quality of the resources dedicated by the adviser and subadviser to maintain relative performance, the Board concluded that the nature, extent, and quality of the services provided to the Fund will benefit the Fund’s shareholders.
The Board also considered that the Fund’s contractual advisory fee and breakpoints placed the Fund in the second quintile of its Lipper-constructed Expense Group, and the Fund’s total expenses placed the Fund in the first quintile. The Board considered that effective May 1, 2006, the Fund’s subadviser was changed and a new subadvisory fee schedule (with lower fees) was implemented. The Board concluded that the Fund’s management fee and total expenses were fair and reasonable in light of the services that the Fund receives and the other factors considered.
The Board considered that the Fund’s adviser reported a pre-tax profit margin for investment management services during each of the twelve month-periods ended September 30, 2006 and 2005. The Board considered the costs of the services provided by and the profits realized by the adviser in connection with the operation of the Fund and determined that the amount of profit is a fair entrepreneurial profit for the management of the Fund.
Based upon its evaluation of all of the conclusions noted above, and after considering all material factors with respect to the Fund, the Board ultimately concluded that the advisory fee structure is fair and reasonable, and that the Advisory Agreement (and, if applicable, Sub-Advisory Agreement) with respect to the Fund, should be renewed.
B. Approval of New Advisory Agreement
At its January 11, 2007 meeting, the Board also unanimously approved a new investment advisory agreement (the “New Agreement”) for the Fund with Nationwide Fund Advisors, (“NFA”) the then-current adviser to each of the series of the Trust to become effective upon the closing of the acquisition of NFA by Nationwide Financial Services, Inc. (“NFS”) from Nationwide Corporation (“NWC”) which closed on April 30, 2007 (the “Transaction”). In approving the New Agreement, the Board considered NFA’s capacity to continue to provide the services needed to operate a sophisticated investment management business and to support the management of each of the series. The Board also took into account the information provided to them at their regular quarterly meetings with NFA’s senior management with respect to the Fund, including the information provided by management at the Fund’s annual Section 15(c) meetings on December 6-7, 2006 and January 11, 2007. In addition, the Board also considered NFS’ announced intentions, over
C. Submission of Matters to a Vote of Security Holders:
On April 25, 2007, a Special Meeting of Shareholders was held* (the “April 25 Meeting”) at which shareholders of the Funds** set forth below were asked:
Proposal 1:
To approve a new investment advisory agreement, on behalf of their Fund, between Nationwide Fund Advisors (formerly “Gartmore Mutual Fund Capital Trust”) (the “Adviser”) and Nationwide Variable Insurance Trust (formerly “Gartmore Variable Insurance Trust”) (the “Trust”).
Number of Shares | ||||||||||
Fund | Cast/Not Cast | Percentages | ||||||||
Federated NVIT High Income Bond Fund | FOR | 30,051,703.188 shares | 92.514% | |||||||
(Formerly Federated GVIT | AGAINST | 618,245.021 shares | 1.903% | |||||||
High Income Bond Fund) | ABSTAIN | 1,813,550.431 shares | 5.583% | |||||||
TOTAL | 32,483,498.640 shares | |||||||||
NVIT International Index Fund | FOR | 4,322,203.982 shares | 96.897% | |||||||
(Formerly GVIT International | AGAINST | 2,758.318 shares | 0.062% | |||||||
Index Fund) | ABSTAIN | 135,636.840 shares | 3.041% | |||||||
TOTAL | 4,460,599.140 shares | |||||||||
NVIT International Value Fund | FOR | 20,032,843.199 shares | 93.351% | |||||||
(Formerly GVIT International | AGAINST | 333,588.902 shares | 1.554% | |||||||
Value Fund) | ABSTAIN | 1,093,293.879 shares | 5.095% | |||||||
TOTAL | 21,459,725.980 shares | |||||||||
NVIT Mid Cap Index Fund | FOR | 35,380,179.120 shares | 94.154% | |||||||
(Formerly GVIT Mid Cap Index Fund) | AGAINST | 631,117.844 shares | 1.679% | |||||||
ABSTAIN | 1,565,714.306 shares | 4.167% | ||||||||
TOTAL | 37,577,011.270 shares | |||||||||
NVIT S&P 500 Index Fund | FOR | 56,119,814.230 shares | 95.554% | |||||||
(Formerly GVIT S&P 500 Index Fund) | AGAINST | 666,195.542 shares | 1.134% | |||||||
ABSTAIN | 1,944,898.888 shares | 3.312% | ||||||||
TOTAL | 58,730,908.660 shares |
Number of Shares | ||||||||||
Fund | Cast/Not Cast | Percentages | ||||||||
Nationwide Multi-Manager NVIT | FOR | 7,632,918.513 shares | 92.700% | |||||||
Small Cap Growth Fund | AGAINST | 149,458.111 shares | 1.816% | |||||||
(Formerly GVIT Small Cap | ABSTAIN | 451,583.036 shares | 5.484% | |||||||
Growth Fund) | TOTAL | 8,233,959.660 shares | ||||||||
Nationwide Multi-Manager NVIT | FOR | 48,649,396.525 shares | 92.816% | |||||||
Small Cap Value Fund | AGAINST | 979,183.753 shares | 1.868% | |||||||
(Formerly GVIT Small Cap | ABSTAIN | 2,786,133.102 shares | 5.316% | |||||||
Value Fund) | TOTAL | 52,414,713.380 shares | ||||||||
Nationwide Multi-Manager NVIT | FOR | 29,903,181.700 shares | 91.311% | |||||||
Small Company Fund | AGAINST | 838,774.923 shares | 2.561% | |||||||
(Formerly GVIT Small Company Fund) | ABSTAIN | 2,006,741.307 shares | 6.128% | |||||||
TOTAL | 32,748,697.930 shares | |||||||||
Gartmore NVIT Developing | FOR | 21,0177,889.443 shares | 91.460% | |||||||
Markets Fund | AGAINST | 424,272.958 shares | 1.841% | |||||||
(Formerly Gartmore GVIT | ABSTAIN | 1,543,850.729 shares | 6.699% | |||||||
Developing Markets Fund) | TOTAL | 23,046,013.130 shares | ||||||||
Gartmore NVIT Emerging | FOR | 17,050,534.593 shares | 92.371% | |||||||
Markets Fund | AGAINST | 526,574.722 shares | 2.853% | |||||||
(Formerly Gartmore GVIT | ABSTAIN | 881,608.905 shares | 4.776% | |||||||
Emerging Markets Fund) | TOTAL | 18,458,718.220 shares | ||||||||
Nationwide NVIT Global | FOR | 1,554,847.333 shares | 95.589% | |||||||
Financial Services Fund | AGAINST | 19,539.033 shares | 1.201% | |||||||
(Formerly Gartmore GVIT | ABSTAIN | 52,206.494 shares | 3.210% | |||||||
Global Financial Services Fund) | TOTAL | 1,626,592.860 shares | ||||||||
Nationwide NVIT Global Health | FOR | 4,722,963.678 shares | 92.815% | |||||||
Sciences Fund | AGAINST | 157,979.030 shares | 3.104% | |||||||
(Formerly Gartmore GVIT | ABSTAIN | 207,642.222 shares | 4.081% | |||||||
Global Health Sciences Fund) | TOTAL | 5,088,584.930 shares | ||||||||
Nationwide NVIT Global Technology | FOR | 8,585,472.039 shares | 93.551% | |||||||
and Communications Fund | AGAINST | 102,267.977 shares | 1.114% | |||||||
(Formerly Gartmore GVIT | ABSTAIN | 489,577.634 shares | 5.335% | |||||||
Global Technology and Communications Fund) | TOTAL | 9,177,317.650 shares | ||||||||
Gartmore NVIT Global | FOR | 4,123,270.549 shares | 91.923% | |||||||
Utilities Fund | AGAINST | 122,001.533 shares | 2.720% | |||||||
(Formerly Gartmore GVIT | ABSTAIN | 240,276.088 shares | 5.357% | |||||||
Global Utilities Fund) | TOTAL | 4,485,548.170 shares | ||||||||
Nationwide NVIT Government | FOR | 88,471,567.462 shares | 92.024% | |||||||
Bond Fund | AGAINST | 1,825,645.181 shares | 1.899% | |||||||
(Formerly Gartmore GVIT | ABSTAIN | 5,841,990.727 shares | 6.077% | |||||||
Government Bond Fund) | TOTAL | 96,139,203.370 shares | ||||||||
Nationwide NVIT Growth Fund | FOR | 14,931,435.904 shares | 89.942% | |||||||
(Formerly Gartmore GVIT | AGAINST | 409,826.402 shares | 2.469% | |||||||
Growth Fund) | ABSTAIN | 1,259,945.064 shares | 7.589% | |||||||
TOTAL | 16,601,207.370 shares |
Number of Shares | ||||||||||
Fund | Cast/Not Cast | Percentages | ||||||||
Gartmore NVIT International | FOR | 6,251,419.070 shares | 93.569% | |||||||
Growth Fund | AGAINST | 139,618.548 shares | 2.090% | |||||||
(Formerly Gartmore GVIT | ABSTAIN | 290,025.592 shares | 4.341% | |||||||
International Growth Fund) | TOTAL | 6,681,063.210 shares | ||||||||
Nationwide NVIT Investor | FOR | 49,489,224.549 shares | 90.688% | |||||||
Destinations Aggressive Fund | AGAINST | 1,385,396.474 shares | 2.539% | |||||||
(Formerly Gartmore GVIT | ABSTAIN | 3,696,272.337 shares | 6.773% | |||||||
Investor Destinations Aggressive Fund) | TOTAL | 54,570,893.360 shares | ||||||||
Nationwide NVIT Investor | FOR | 23,091,965.887 shares | 89.855% | |||||||
Destinations Conservative Fund | AGAINST | 314,935,884 shares | 1.225% | |||||||
(Formerly Gartmore GVIT | ABSTAIN | 2,292,355.179 shares | 8.920% | |||||||
Investor Destinations Conservative Fund) | TOTAL | 25,699,256.950 shares | ||||||||
Nationwide NVIT Investor | FOR | 188,902,093.059 shares | 90.696% | |||||||
Destinations Moderate Fund | AGAINST | 3,018,924.590 shares | 1.449% | |||||||
(Formerly Gartmore GVIT | ABSTAIN | 16,359,690.401 shares | 7.855% | |||||||
Investor Destinations Moderate Fund) | TOTAL | 208,280,708.050 shares | ||||||||
Nationwide NVIT Investor | FOR | 134,792,622.920 shares | 91.332% | |||||||
Destinations Moderately Aggressive Fund | AGAINST | 3,489,207.264 shares | 2.364% | |||||||
(Formerly Gartmore GVIT Investor Destinations | ABSTAIN | 9,304,197.656 shares | 6.304% | |||||||
Moderately Aggressive Fund) | TOTAL | 147,586,027.840 shares | ||||||||
Nationwide NVIT Investor | FOR | 49,627,123.216 shares | 91.918% | |||||||
Destinations Moderately Conservative Fund | AGAINST | 856,088.634 shares | 1.586% | |||||||
(Formerly Gartmore GVIT Investor Destinations | ABSTAIN | 3,507,215.650 shares | 6.496% | |||||||
Moderately Conservative Fund) | TOTAL | 53,990,427.500 shares | ||||||||
Nationwide NVIT Mid Cap | FOR | 10,879,584.971 shares | 91.043% | |||||||
Growth Fund | AGAINST | 352,594.958 shares | 2.950% | |||||||
(Formerly Gartmore GVIT Mid | ABSTAIN | 717,792.971 shares | 6.007% | |||||||
Cap Growth Fund) | TOTAL | 11,949,972.900 shares | ||||||||
Nationwide NVIT Money Market | FOR | 221,774,863.241 shares | 88.508% | |||||||
Fund II | AGAINST | 12,322,482.494 shares | 4.918% | |||||||
(Formerly Gartmore GVIT Money | ABSTAIN | 16,471,740.875 shares | 6.574% | |||||||
Market Fund II) | TOTAL | 250,569,086.610 shares | ||||||||
Nationwide NVIT Money Market | FOR | 1,578,331,008.328 shares | 91.585% | |||||||
Fund | AGAINST | 32,372,133.671 shares | 1.878% | |||||||
(Formerly Gartmore GVIT Money | ABSTAIN | 112,652,123.301 shares | 6.537% | |||||||
Market Fund) | TOTAL | 1,723,355,265.300 shares | ||||||||
NVIT Nationwide Fund | FOR | 125,423,274.735 shares | 91.581% | |||||||
(Formerly Gartmore GVIT | AGAINST | 2,767,979.467 shares | 2.021% | |||||||
Nationwide Fund) | ABSTAIN | 8,762,255.828 shares | 6.398% | |||||||
TOTAL | 136,953,510.030 shares | |||||||||
NVIT Nationwide Leaders Fund | FOR | 2,298,504.956 shares | 95.780% | |||||||
(Formerly Gartmore GVIT | AGAINST | 29,630.469 shares | 1.235% | |||||||
Nationwide Leaders Fund) | ABSTAIN | 71,637.755 shares | 2.985% | |||||||
TOTAL | 2,399,773.180 shares |
Number of Shares | ||||||||||
Fund | Cast/Not Cast | Percentages | ||||||||
Nationwide NVIT U.S. Growth | FOR | 4,972,094.773 shares | 94.359% | |||||||
Leaders Fund | AGAINST | 122,623.161 shares | 2.327% | |||||||
(Formerly Gartmore GVIT U.S. | ABSTAIN | 174,625.606 shares | 3.314% | |||||||
Growth Leaders Fund) | TOTAL | 5,269,343.540 shares | ||||||||
Gartmore NVIT Worldwide | FOR | 2,666,862.487 shares | 94.126% | |||||||
Leaders Fund | AGAINST | 47,702.491 shares | 1.684% | |||||||
(Formerly Gartmore GVIT | ABSTAIN | 118,719.882 shares | 4.190% | |||||||
Worldwide Leaders Fund) | TOTAL | 2,833,284.860 shares | ||||||||
J.P. Morgan NVIT Balanced Fund | FOR | 15,966,867.546 shares | 90.900% | |||||||
(Formerly J.P. Morgan GVIT | AGAINST | 259,004.324 shares | 1.475% | |||||||
Balanced Fund) | ABSTAIN | 1,339,385.200 shares | 7.625% | |||||||
TOTAL | 17,565,257.070 shares | |||||||||
Van Kampen NVIT Comstock | FOR | 27,737,008.009 shares | 92.259% | |||||||
Value Fund | AGAINST | 502,564.164 shares | 1.672% | |||||||
(Formerly Van Kampen GVIT | ABSTAIN | 1,824,670.107 shares | 6.069% | |||||||
Comstock Value Fund) | TOTAL | 30,064,242.280 shares | ||||||||
Van Kampen NVIT Multi Sector | FOR | 21,253,297.665 shares | 90.281% | |||||||
Bond Fund | AGAINST | 484,100.920 shares | 2.056% | |||||||
(Formerly Van Kampen GVIT | ABSTAIN | 1,803,963.645 shares | 7.663% | |||||||
Multi Sector Bond Fund) | TOTAL | 23,541,362.230 shares | ||||||||
At the April 25 Meeting, shareholders of the Nationwide NVIT Mid Cap Growth Fund were also asked to approve a new investment subadvisory agreement among the Adviser, the Trust and NorthPointe Capital LLC. The voting results with respect to that proposal are set forth below:
Proposal 2
Number of Shares | ||||||||||
Fund | Cast/Not Cast | Percentages | ||||||||
Nationwide NVIT Mid Cap Growth | FOR | 10,862,827.499 shares | 90.903% | |||||||
Fund | AGAINST | 414,574.660 shares | 3.469% | |||||||
(Formerly Gartmore GVIT Mid | ABSTAIN | 672,570.741 shares | 5.628% | |||||||
Cap Growth Fund) | TOTAL | 11,949,972.900 shares | ||||||||
* | This meeting was previously adjourned on April 23, 2007. | |
** | Fund names were changed effective May 1, 2007 to reflect “Nationwide”/ “NVIT” branding to coincide with the sale of Nationwide Fund Advisors, Inc. by Nationwide Corporation to its majority-owned subsidiary, Nationwide Financial Services, Inc. |
June 30, 2007 (Unaudited)
Contents | ||
7 | Statement of Investments | |
28 | Statement of Assets and Liabilities | |
29 | Statement of Operations | |
30 | Statements of Changes in Net Assets | |
32 | Financial Highlights | |
33 | Notes to Financial Statements |
Statement Regarding Availability of Proxy Voting Record.
SAR-JPMB (8/07) | ![]() |
Dear Fellow Shareholder:
Since I last wrote to you, our mutual funds have enjoyed another period of solid performance, and the corporate realignment that was in progress is now finished.
On May 1, 2007, Nationwide Financial Services, Inc. (NFS), completed its acquisition of the Philadelphia-based retail mutual fund operations of NWD Investment Management, Inc. (formerly, “Gartmore Global Investments, Inc.”), from Nationwide Corporation, a subsidiary of Nationwide Mutual Insurance Company. Effective that date, the acquired entities were renamed Nationwide Funds Group (NFG), and the Gartmore Funds were renamed the Nationwide Funds to better align with the Nationwide® brand. Although the corporate ownership and fund names have changed, I can assure you that NFG intends to maintain as much continuity as possible with the Funds and key personnel.
Thank you, shareholders, for approving the new investment advisory agreement that was required due to the change in corporate ownership. The new agreement is identical in all material respects to the original agreement that it replaces, with the exception of the section pertaining to the vote by the shareholders of the NVIT Mid Cap Growth Fund to approve NorthPointe Capital®, LLC (NorthPointe) as sub-adviser to that particular Fund.
Market Overview: January 1-June 30, 2007
Share prices in general were buoyed in part by better-than-expected first-quarter 2007 earnings and a flurry of mergers and acquisitions, many of these spurred by readily available funding from private equity firms. In June, investors grew more cautious amid surging crude oil prices, a sudden spike in long-term interest rates, and the meltdown of two hedge funds that had exposure to the subprime mortgage market. Looking abroad, a weak U.S. dollar aided foreign stocks, as reflected in the 11.09% advance of the Morgan Stanley Capital International Europe, Australasia and Far East (MSCI EAFE®) Index. Emerging market performance was particularly robust.
The bond market struggled during the first half of 2007. While short-term interest rates remained stable, reflecting the Federal Reserve Board’s decision in June to leave the target federal funds rate at 5.25%, longer-term rates climbed during the first half of 2007, depressing bond prices and forcing the Lehman Brothers® U.S. Aggregate Index to settle for a modest 0.97% return.
We at NFG thank you for your understanding and cooperation throughout our recent transition period. We emerge from this period energized for the future, and we look forward to serving your investment needs for a long time to come.
Nationwide Funds Group
PAST PERFORMANCE IS NO GUARANTEE OF FUTURE RESULTS.
Nationwide Funds are advised by Nationwide Fund Advisors (NFA). NFA is a wholly-owned subsidiary of Nationwide Financial Services. Nationwide Financial Services is a wholly-owned subsidiary of Nationwide Corporation. All of the common stock of Nationwide Corporation is held by Nationwide Mutual (95.2%) and Nationwide Mutual Fire Insurance Company (4.8%), each of which is a mutual company owned by its policyholders.
Nationwide Funds Group (NFG) is the mutual fund arm of Nationwide Financial Services (NYSE: NFS). Based in Conshohocken, Pa., a suburb of Philadelphia, NFG is comprised of Nationwide Fund Advisors, Nationwide Fund Distributors, LLC, and Nationwide Fund Management, LLC. Together, these provide advisory, distribution, and administration services respectively to the Nationwide Funds, and manage more than $43.5 billion in assets as of June 30, 2007, of which more than $12 billion are in “fund of funds” designed to provide asset allocation across several types of investments and asset classes.
Lehman Brothers (LB) U.S. Aggregate Index: An unmanaged, market value-weighted index of investment-grade, fixed-rate debt issues (including government, corporate, asset-backed, and mortgage-backed securities with maturities of one year or more) that is generally representative of the bond market as a whole.
Morgan Stanley Capital International Europe, Australasia and Far East (MSCI EAFE®) Index: An unmanaged, free float-adjusted, market capitalization-weighted index that is designed to measure the performance of stocks in developed markets outside the United States and Canada.
Standard & Poor’s 500® (S&P 500) Index: An unmanaged, market capitalization-weighted index of 500 widely held stocks of large-cap U.S. companies that gives a broad look at how the stock prices of those companies have performed.
Views expressed within are those of Nationwide Funds Group as of the date noted, are subject to change at any time, and may not come to pass.
This report is for informational purposes only, and is not intended as an offer or recommendation with respect to the purchase or sale of any security, option, future, or other derivatives in such securities.
Investing in mutual funds involves risk, including possible loss of principal.
Investors should carefully consider a fund’s investment objectives, risks, fees, charges, and expenses before investing any money. To obtain this and other fund information, please call 800-848-0920 to request a prospectus, or download a prospectus at www.nationwidefunds.com. Please read the prospectus carefully before investing any money.
Nationwide Funds distributed by Nationwide Fund Distributors LLC (formerly Gartmore Distribution Services, Inc.), Member NASD. 1200 River Road, Suite 1000, Conshohocken, Pa. 19428.
As a shareholder of the Fund, you incur two types of costs: (1) transaction costs, including sales charges (loads) paid on purchase payments and redemption fees; and (2) ongoing costs, including investment advisory fees, administration fees, distribution fees and other Fund expenses. The examples below are 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. Per SEC requirements, the examples assume that you had a $1,000 investment in the Class at the beginning of the reporting period, January 1, 2007, and continued to hold your shares at the end of the reporting period, June 30, 2007.
Actual Expenses
Hypothetical Example for Comparison Purposes
Please note that the expenses shown in the table are meant to highlight your ongoing costs only and do not reflect any transaction costs, such as sales charges (loads) or redemption fees. Therefore, the second line for each Class in 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 transaction costs were included, your costs would have been higher. The examples also assume all dividends and distributions have been reinvested.
Schedule of Shareholder Expenses
Beginning | Ending | |||||||||||||||||||||
Account Value | Account Value | Expenses Paid | Annualized | |||||||||||||||||||
J.P. Morgan NVIT Balanced Fund | 1/1/07 | 06/30/07 | During Period* | Expense Ratio* | ||||||||||||||||||
Class I | Actual | $ | 1,000.00 | $ | 1,049.80 | $ | 5.13 | 1.01% | ||||||||||||||
Hypothetical | 1 | $ | 1,000.00 | $ | 1,019.79 | $ | 5.07 | 1.01% | ||||||||||||||
Class IV | Actual | $ | 1,000.00 | $ | 1,049.80 | $ | 5.08 | 1.00% | ||||||||||||||
Hypothetical | 1 | $ | 1,000.00 | $ | 1,019.84 | $ | 5.02 | 1.00% | ||||||||||||||
* | Expenses are equal to the Fund’s annualized expense ratio multiplied by the average account value over the period multiplied by 181/365 (to reflect the one-half year period). The expense ratio presented represents a six-month, annualized ratio in accordance with SEC guidelines. The expenses reported above do not include the effect of additional expenses imposed by variable annuity contracts. |
1 Represents the hypothetical 5% return before expenses.
June 30, 2007 | Long Positions |
Asset Allocation | ||||
Common Stock | 67.0% | |||
Mortgage-Backed Obligations | 15.2% | |||
Corporate Bonds | 7.1% | |||
Asset-Backed Securities | 6.7% | |||
Commercial Paper | 6.0% | |||
Cash Equivalents | 4.7% | |||
U.S. Government Agency Long-Term Obligations | 1.1% | |||
U.S. Government Sponsored & Agency Obligations | 0.8% | |||
Sovereign Bonds | 0.5% | |||
U.S. Treasury Notes | 0.1% | |||
Liabilities in excess of other assets | -9.2% | |||
100.0% |
Top Holdings | ||||
AIM Liquid Assets Portfolio, 5.09%, 04/01/42 | 4.7% | |||
Federal National Mortgage Association TBA, 6.00%, 06/01/22 | 3.3% | |||
Federal National Mortgage Association TBA, 7.00%, 04/01/37 | 1.8% | |||
Exxon Mobil Corp., 0.35% | 1.6% | |||
Federal National Mortgage Association TBA, 5.00%, 08/01/33 | 1.3% | |||
Federal National Mortgage Association TBA, 5.50%, 07/15/37 | 1.1% | |||
Bank of America Corp. | 1.0% | |||
AT&T, Inc. | 1.0% | |||
General Electric Co. | 1.0% | |||
Microsoft Corp. | 0.9% | |||
Other | 82.3% | |||
100.0% |
Top Industries | ||||
Oil, Gas & Consumable Fuels | 5.9% | |||
Money Market Funds | 4.7% | |||
Diversified Financial Services | 4.6% | |||
Pharmaceuticals | 4.4% | |||
Commercial Banks | 4.1% | |||
Other Financial | 3.1% | |||
Insurance | 3.0% | |||
Diversified Telecommunication Services | 2.2% | |||
Computers & Peripherals | 2.2% | |||
Software | 1.9% | |||
Other | 63.9% | |||
100.0% |
Top Countries | ||||
United States | 54.3% | |||
United Kingdom | 3.2% | |||
Japan | 3.0% | |||
France | 1.8% | |||
Germany | 1.4% | |||
Switzerland | 0.8% | |||
Australia | 0.6% | |||
Spain | 0.6% | |||
Netherlands | 0.5% | |||
Hong Kong | 0.4% | |||
Other | 33.4% | |||
100.0% |
June 30, 2007 | Short Positions |
Asset Allocation | ||||
Mortgage-Backed Obligations | 1.4% | |||
Common Stocks | 0.0% | |||
1.4% |
Top Holdings | ||||
Federal National Mortgage Association TBA, 6.50%, 07/15/37 | 1.0% | |||
Federal National Mortgage Association TBA, 7.00%, 07/01/36 | 0.3% | |||
Federal National Mortgage Association TBA, 6.50%, 08/01/30 | 0.1% | |||
Federal National Mortgage Association TBA, 5.50%, 08/01/19 | 0.0% | |||
Discovery Financial Services | 0.0% | |||
1.4% |
J.P. Morgan NVIT Balanced Fund
Common Stocks - Long Positions (67.0%) | ||||||||
Shares or | ||||||||
Principal Amount | Value | |||||||
AUSTRALIA (0.6%) (a) | ||||||||
Capital Markets (0.2%) | ||||||||
Macquarie Bank Ltd. | 3,963 | $ | 284,576 | |||||
Commercial Services & Supplies (0.0%) | ||||||||
Brambles Ltd.* | 3,062 | 31,560 | ||||||
Food & Staples Retailing (0.1%) | ||||||||
Woolworths Ltd. | 8,197 | 187,281 | ||||||
Industrial Conglomerate (0.1%) | ||||||||
Wesfarmers Ltd. | 3,538 | 136,960 | ||||||
Manufacturing (0.0%) | ||||||||
Palfinger AG | 1,056 | 58,254 | ||||||
Metals & Mining (0.0%) | ||||||||
International Ferro Metals Ltd.* | 28,312 | 68,474 | ||||||
Multi-Utility (0.1%) | ||||||||
AGL Energy Ltd. | 14,121 | 181,408 | ||||||
Transportation Infrastructure (0.1%) | ||||||||
Macquarie Infrastructure Group | 82,258 | 250,491 | ||||||
1,199,004 | ||||||||
AUSTRIA (0.2%) (a) | ||||||||
Diversified Telecommunication Services (0.1%) | ||||||||
Telekom Austria AG | 7,166 | 178,434 | ||||||
Machinery (0.1%) | ||||||||
Andritz AG | 1,496 | 98,511 | ||||||
276,945 | ||||||||
BELGIUM (0.3%) (a) | ||||||||
Chemicals (0.1%) | ||||||||
Solvay SA | 1,044 | 164,323 | ||||||
Diversified Financial Services (0.2%) | ||||||||
Fortis | 5,945 | 251,944 | ||||||
Fortis NV | 1,613 | 68,423 | ||||||
320,367 | ||||||||
Health Care Equipment & Supplies (0.0%) | ||||||||
Omega Pharma SA | 307 | 26,574 | ||||||
511,264 | ||||||||
BERMUDA (0.4%) | ||||||||
Consumer Goods (0.0%) | ||||||||
Helen of Troy Ltd.* | 300 | 8,100 | ||||||
Insurance (0.1%) | ||||||||
Aspen Insurance Holdings Ltd. BR | 900 | 25,263 | ||||||
Axis Capital Holdings Limited | 1,100 | 44,715 | ||||||
Platinum Underwriters Holdings Ltd. | 700 | 24,325 | ||||||
Renaissancere Holdings Ltd. | 200 | 12,398 | ||||||
106,701 | ||||||||
IT Services (0.1%) | ||||||||
Accenture Ltd. | 6,750 | 289,507 | ||||||
Machinery (0.2%) | ||||||||
Ingersoll Rand Co. Ltd., Class A ADR | 5,500 | 301,510 | ||||||
Wireless Telecommunication Services (0.0%) | ||||||||
Intelsat Bermuda Ltd. | 10,000 | 10,625 | ||||||
716,443 | ||||||||
BRAZIL (0.0%) (a) | ||||||||
Airline (0.0%) | ||||||||
Air Berlin PLC* | 2,808 | 59,655 | ||||||
CANADA (0.0%) | ||||||||
Pharmaceutical (0.0%) | ||||||||
Cardiome Pharma Corp.* | 825 | 7,598 | ||||||
CAYMAN ISLANDS (0.2%) | ||||||||
Insurance (0.1%) | ||||||||
ACE Ltd. ADR | 3,420 | 213,818 | ||||||
Wireless Telecommunication Services (0.1%) (a) | ||||||||
Hutchison Telecommunications International Ltd. | 70,638 | 90,985 | ||||||
304,803 | ||||||||
FINLAND (0.1%) (a) | ||||||||
Communications Equipment (0.0%) | ||||||||
Nokia OYJ | 3,068 | 86,156 | ||||||
Construction & Engineering (0.1%) | ||||||||
YIT OYJ | 3,801 | 119,277 | ||||||
Industrial Conglomerate (0.0%) | ||||||||
Ruukki Group OYJ | 14,149 | 49,206 | ||||||
254,639 | ||||||||
FRANCE (1.7%) | ||||||||
Automobiles (0.2%) (a) | ||||||||
Renault SA | 1,814 | 290,914 | ||||||
Building Products (0.1%) (a) | ||||||||
Compagnie de Saint-Gobain | 1,245 | 139,453 | ||||||
J.P. Morgan NVIT Balanced Fund (Continued)
Common Stocks - Long Positions (continued) | ||||||||
Shares or | ||||||||
Principal Amount | Value | |||||||
FRANCE (continued) | ||||||||
Chemicals (0.2%) | ||||||||
Arkema* (a) | 2,916 | $ | 190,598 | |||||
Rhodia SA (Euronext)* | 3,031 | 137,823 | ||||||
328,421 | ||||||||
Commercial Banks (0.3%) (a) | ||||||||
BNP Paribas | 3,334 | 395,982 | ||||||
Credit Agricole SA | 1,362 | 55,261 | ||||||
Societe Generale | 676 | 125,235 | ||||||
576,478 | ||||||||
Communications Equipment (0.0%) (a) | ||||||||
Alcatel-Lucent | 3,506 | 49,035 | ||||||
Construction Materials (0.1%) (a) | ||||||||
Lafarge SA | 750 | 136,675 | ||||||
Electrical Equipment (0.1%) (a) | ||||||||
Schneider Electric SA | 1,122 | 157,185 | ||||||
Food Products (0.0%) (a) | ||||||||
Groupe Danone | 944 | 76,235 | ||||||
Insurance (0.1%) (a) | ||||||||
Axa | 6,257 | 268,932 | ||||||
Media (0.2%) (a) | ||||||||
Seloger.com* | 1,527 | 84,770 | ||||||
Vivendi Universal SA | 4,710 | 202,592 | ||||||
287,362 | ||||||||
Multi-Utility (0.1%) (a) | ||||||||
Suez SA | 4,317 | 246,769 | ||||||
Multiline Retail (0.0%) (a) | ||||||||
PPR SA | 111 | 19,360 | ||||||
Oil, Gas & Consumable Fuels (0.2%) (a) | ||||||||
Total SA | 5,341 | 432,992 | ||||||
Pharmaceutical (0.0%) (a) | ||||||||
Sanofi-Aventis | 232 | 18,741 | ||||||
Wireless Telecommunication Services (0.1%) (a) | ||||||||
Bouygues SA | 2,608 | 218,488 | ||||||
3,247,040 | ||||||||
GERMANY (1.4%) (a) | ||||||||
Auto Components (0.1%) | ||||||||
Continental AG | 890 | 125,066 | ||||||
Automobiles (0.2%) | ||||||||
Daimler Chrysler AG | 654 | 60,197 | ||||||
Porsche AG | 68 | 121,353 | ||||||
Volkswagen AG, Preferred Shares | 2,251 | 232,399 | ||||||
413,949 | ||||||||
Capital Markets (0.1%) | ||||||||
Deutsche Bank AG | 2,136 | 309,105 | ||||||
Chemicals (0.2%) | ||||||||
Bayer AG | 1,985 | 149,507 | ||||||
Lanxess | 3,318 | 185,483 | ||||||
334,990 | ||||||||
Electric Utility (0.2%) | ||||||||
E. On AG | 2,000 | 333,889 | ||||||
Industrial Conglomerate (0.1%) | ||||||||
Siemens AG | 1,312 | 187,860 | ||||||
Insurance (0.2%) | ||||||||
Allianz AG | 1,349 | 314,549 | ||||||
Muenchener Rueckversicherungs AG | 1,153 | 211,427 | ||||||
525,976 | ||||||||
Life Sciences Tools & Services (0.0%) | ||||||||
MorphoSys AG* | 335 | 21,825 | ||||||
Media (0.0%) | ||||||||
ProsiebenSAT.1 Media AG | 566 | 22,223 | ||||||
Metals & Mining (0.1%) | ||||||||
Thyssenkrupp AG | 3,143 | 185,992 | ||||||
Pharmaceutical (0.1%) | ||||||||
Merck KGAA | 1,004 | 137,352 | ||||||
Software (0.1%) | ||||||||
SAP AG | 2,339 | 119,574 | ||||||
2,717,801 | ||||||||
GREECE (0.2%) (a) | ||||||||
Commercial Bank (0.0%) | ||||||||
National Bank of Greece SA | 1,257 | 71,565 | ||||||
Hotels, Restaurants & Leisure (0.1%) | ||||||||
OPAP SA | 2,427 | 85,745 | ||||||
Common Stocks - Long Positions (continued) | ||||||||
Shares or | ||||||||
Principal Amount | Value | |||||||
GREECE (continued) | ||||||||
Metals & Mining (0.1%) | ||||||||
Corinth Pipeworks SA* | 5,402 | $ | 45,278 | |||||
Sidenor Steel Production & Manufacturing Co. | 7,205 | 152,999 | ||||||
198,277 | ||||||||
355,587 | ||||||||
HONG KONG (0.4%) (a) | ||||||||
Industrial Conglomerate (0.1%) | ||||||||
Hutchison Whampoa Ltd. | 17,397 | 172,708 | ||||||
Real Estate Management & Development (0.2%) | ||||||||
Cheung Kong Holdings Ltd. | 16,000 | 209,665 | ||||||
Swire Pacific Ltd. | 17,000 | 189,226 | ||||||
398,891 | ||||||||
Specialty Retail (0.1%) | ||||||||
Esprit Holdings Ltd. | 12,035 | 152,916 | ||||||
724,515 | ||||||||
IRELAND (0.1%) (a) | ||||||||
Construction Materials (0.1%) | ||||||||
CRH PLC | 4,040 | 199,632 | ||||||
Food Products (0.0%) | ||||||||
GreenCore Group PLC | 6,325 | 47,869 | ||||||
247,501 | ||||||||
ITALY (0.3%) (a) | ||||||||
Commercial Banks (0.2%) | ||||||||
Banco Popolare di Verona e Novara Scrl | 2,310 | 66,411 | ||||||
UniCredito Italiano SPA | 39,402 | 351,885 | ||||||
418,296 | ||||||||
Oil, Gas & Consumable Fuels (0.1%) | ||||||||
Eni SPA | 4,240 | 153,715 | ||||||
572,011 | ||||||||
JAPAN (3.0%) (a) | ||||||||
Automobiles (0.2%) | ||||||||
Toyota Motor Corp. | 6,400 | 403,674 | ||||||
Building Products (0.1%) | ||||||||
Daikin Industries Ltd. | 3,400 | 123,853 | ||||||
Chemicals (0.3%) | ||||||||
Dainippon Ink & Chemical, Inc. | 20,000 | 77,179 | ||||||
Kaneka Corp. | 9,000 | 75,383 | ||||||
Mitsubishi Chemical Holdings Corp. | 22,500 | 206,573 | ||||||
Showa Denko KK | 1,000 | 3,617 | ||||||
UBE Industries Ltd. | 53,000 | 163,174 | ||||||
525,926 | ||||||||
Commercial Banks (0.2%) | ||||||||
Mitsubishi UFJ Financial Group, Inc. | 32 | 352,705 | ||||||
Sumitomo Mitsui Financial Group, Inc. | 13 | 121,206 | ||||||
473,911 | ||||||||
Commercial Services & Supplies (0.0%) | ||||||||
Toppan Printing Co. Ltd. | 3,000 | 32,241 | ||||||
Computers & Peripherals (0.1%) | ||||||||
Hitachi Information Systems Ltd. | 5,400 | 120,523 | ||||||
Consumer Finance (0.1%) | ||||||||
ORIX Corp. | 630 | 166,080 | ||||||
Diversified Consumer Services (0.0%) | ||||||||
Benesse Corp. | 2,200 | 63,745 | ||||||
Electric Utilities (0.2%) | ||||||||
Kansai Electric Power Co., Inc. | 3,800 | 89,881 | ||||||
Tokyo Electric Power Co., Inc. | 7,200 | 231,630 | ||||||
321,511 | ||||||||
Electrical Equipment (0.1%) | ||||||||
Mitsubishi Electric Corp. | 20,000 | 185,292 | ||||||
Electronic Equipment & Instruments (0.2%) | ||||||||
Kyocera Corp. | 2,000 | 212,500 | ||||||
Taiyo Yuden Co. Ltd. | 2,000 | 46,269 | ||||||
TDK Corp. | 1,000 | 96,795 | ||||||
Yokogawa Electric Corp. | 6,300 | 84,462 | ||||||
440,026 | ||||||||
Food Products (0.1%) | ||||||||
Ajinomoto Co., Inc. | 7,000 | 80,638 | ||||||
Yakult Honsha Co. Ltd. | 3,700 | 93,570 | ||||||
174,208 | ||||||||
Gas Utility (0.1%) | ||||||||
Tokyo Gas Co. Ltd. | 36,000 | 170,727 | ||||||
Health Care Providers & Services (0.0%) | ||||||||
Suzuken Co. Ltd. | 2,300 | 71,855 | ||||||
Household Durables (0.1%) | ||||||||
Matsushita Electric Industrial Co. Ltd. | 10,000 | 198,196 | ||||||
J.P. Morgan NVIT Balanced Fund (Continued)
Common Stocks - Long Positions (continued) | ||||||||
Shares or | ||||||||
Principal Amount | Value | |||||||
JAPAN (continued) | ||||||||
Household Products (0.0%) | ||||||||
Uni-Charm Corp. | 700 | $ | 39,690 | |||||
IT Services (0.0%) | ||||||||
CSK Corp. | 1,500 | 52,830 | ||||||
Leisure Equipment & Products (0.1%) | ||||||||
Fuji Photo Film Co. Ltd. | 2,000 | 89,402 | ||||||
Machinery (0.1%) | ||||||||
Amada Co. Ltd. | 10,000 | 125,078 | ||||||
Metals & Mining (0.0%) | ||||||||
Mitsubishi Materials Corp. | 7,000 | 38,168 | ||||||
Office Electronics (0.1%) | ||||||||
Ricoh Co. Ltd. | 6,000 | 138,835 | ||||||
Oil, Gas & Consumable Fuels (0.0%) | ||||||||
Nippon Metals & Mining Holdings, Inc. | 8,500 | 81,327 | ||||||
Personal Products (0.1%) | ||||||||
Aderans Co. Ltd. | 1,200 | 25,271 | ||||||
Shiseido Co. Ltd. | 10,000 | 213,490 | ||||||
238,761 | ||||||||
Pharmaceutical (0.1%) | ||||||||
Daiichi Sankyo Co. Ltd. | 5,700 | 151,254 | ||||||
Semiconductors & Semiconductor Equipment (0.1%) | ||||||||
Elpida Memory, Inc.* | 2,200 | 96,620 | ||||||
Tokyo Electron Ltd. | 900 | 66,220 | ||||||
162,840 | ||||||||
Specialty Retail (0.1%) | ||||||||
Nitori Co. Ltd. | 2,800 | 139,800 | ||||||
Tobacco (0.1%) | ||||||||
Japan Tobacco, Inc. | 45 | 221,843 | ||||||
Trading Companies & Distributors (0.3%) | ||||||||
Itochu Corp. | 17,000 | 196,874 | ||||||
Marubenii Corp. | 24,000 | 197,450 | ||||||
Mitsui & Co. Ltd. | 11,000 | 219,554 | ||||||
613,878 | ||||||||
Wireless Telecommunication Services (0.1%) | ||||||||
Softbank Corp. | 7,600 | 163,796 | ||||||
5,729,270 | ||||||||
NETHERLANDS (0.5%) (a) | ||||||||
Air Freight & Logistics (0.2%) | ||||||||
TNT NV | 6,832 | 308,444 | ||||||
Commercial Bank (0.1%) | ||||||||
ABN AMRO Holding NV | 3,320 | 152,213 | ||||||
Commercial Services & Supplies (0.0%) | ||||||||
Usg People N.V. | 722 | 33,872 | ||||||
Diversified Telecommunication Services (0.1%) | ||||||||
Koninklijke KPN NV | 15,622 | 259,153 | ||||||
Insurance (0.0%) | ||||||||
Aegon NV | 2,515 | 49,495 | ||||||
Metals & Mining (0.1%) | ||||||||
Mittal Steel Co. NV | 2,991 | 186,924 | ||||||
990,101 | ||||||||
NETHERLANDS ANTILLES (0.3%) | ||||||||
Energy Equipment & Services (0.3%) | ||||||||
Schlumberger Ltd. ADR | 7,400 | 628,556 | ||||||
NORWAY (0.2%) (a) | ||||||||
Industrial Conglomerate (0.2%) | ||||||||
Orkla ASA | 16,380 | 308,977 | ||||||
PANAMA (0.1%) | ||||||||
Airline (0.0%) | ||||||||
Copa Holdings SA | 950 | 63,878 | ||||||
Hotels, Restaurants & Leisure (0.1%) | ||||||||
Carnival Corp. ADR | 3,700 | 180,449 | ||||||
244,327 | ||||||||
PORTUGAL (0.0%) (a) | ||||||||
Commercial Bank (0.0%) | ||||||||
Banco Comercial Portugues SA | 8,307 | 46,419 | ||||||
PUERTO RICO (0.0%) | ||||||||
Commercial Bank (0.0%) | ||||||||
W Holding Co., Inc. | 1,100 | 2,904 | ||||||
REPUBLIC OF KOREA (0.1%) | ||||||||
Bank (0.1%) | ||||||||
Woori Bank | 135,000 | 128,999 | ||||||
SINGAPORE (0.1%) (a) | ||||||||
Diversified Telecommunication Services (0.0%) | ||||||||
Singapore Telecommunications Ltd. | 23,900 | 53,166 | ||||||
Electronic Equipment & Instruments (0.1%) | ||||||||
Venture Corp. Ltd. | 11,000 | 112,790 | ||||||
165,956 | ||||||||
Common Stocks - Long Positions (continued) | ||||||||
Shares or | ||||||||
Principal Amount | Value | |||||||
SPAIN (0.6%) (a) | ||||||||
Commercial Banks (0.3%) | ||||||||
Banco Bilbao Vizcaya Argentaria SA | 17,202 | $ | 420,628 | |||||
Banco Santander Central Hispano SA | 5,783 | 106,291 | ||||||
526,919 | ||||||||
Construction & Engineering (0.1%) | ||||||||
ACS, Actividades de Construccion y Servicios SA | 1,769 | 112,458 | ||||||
Diversified Telecommunication Services (0.2%) | ||||||||
Telefonica SA | 20,291 | 451,508 | ||||||
Metals & Mining (0.0%) | ||||||||
Tubacex, SA | 6,454 | 54,182 | ||||||
1,145,067 | ||||||||
SWEDEN (0.1%) (a) | ||||||||
Commercial Bank (0.0%) | ||||||||
Svenska Handelsbanked AB, A Shares | 834 | 23,329 | ||||||
Communications Equipment (0.1%) | ||||||||
Telefonaktiebolaget LM Ericsson, B Shares | 35,895 | 143,227 | ||||||
166,556 | ||||||||
SWITZERLAND (0.8%) (a) | ||||||||
Capital Markets (0.2%) | ||||||||
Credit Suisse Group | 4,142 | 294,117 | ||||||
UBS AG | 2,453 | 146,736 | ||||||
440,853 | ||||||||
Construction Materials (0.0%) | ||||||||
Holcim Ltd. | 746 | 80,586 | ||||||
Electrical Equipment (0.1%) | ||||||||
ABB Ltd. | 3,874 | 87,372 | ||||||
Food Products (0.0%) | ||||||||
Nestle SA | 112 | 42,567 | ||||||
Insurance (0.1%) | ||||||||
Swiss Reinsurance | 1,867 | 170,313 | ||||||
Zurich Financial Services AG | 243 | 75,137 | ||||||
245,450 | ||||||||
Pharmaceuticals (0.3%) | ||||||||
Novartis AG | 932 | 52,336 | ||||||
Roche Holding AG | 2,400 | 425,352 | ||||||
477,688 | ||||||||
Textiles, Apparel & Luxury Goods (0.1%) | ||||||||
Compagnie Finaciere Richemont AG | 3,040 | 181,749 | ||||||
1,556,265 | ||||||||
UNITED KINGDOM (2.9%) (a) | ||||||||
Airline (0.1%) | ||||||||
British Airways PLC* | 19,556 | 163,547 | ||||||
Capital Markets (0.1%) | ||||||||
Man Group PLC | 8,286 | 100,780 | ||||||
Commercial Banks (0.8%) | ||||||||
Barclays PLC | 30,019 | 417,610 | ||||||
HBOS PLC | 10,197 | 200,548 | ||||||
HSBC Holdings PLC | 28,150 | 515,388 | ||||||
Royal Bank of Scotland Group PLC | 32,550 | 411,830 | ||||||
1,545,376 | ||||||||
Commercial Services & Supplies (0.1%) | ||||||||
Management Consulting Group PLC | 53,986 | 52,903 | ||||||
Michael Page International PLC | 6,777 | 71,192 | ||||||
124,095 | ||||||||
Electric Utility (0.0%) | ||||||||
Scottish & Southern Energy PLC | 1,206 | 34,964 | ||||||
Food & Staples Retailing (0.1%) | ||||||||
Tesco PLC | 32,944 | 275,605 | ||||||
Hotels, Restaurants & Leisure (0.1%) | ||||||||
First Choice Holidays PLC | 9,577 | 60,823 | ||||||
Intercontinental Hotels Group PLC | 5,476 | 136,014 | ||||||
196,837 | ||||||||
Household Durables (0.1%) | ||||||||
Taylor Woodrow PLC | 21,236 | 152,866 | ||||||
Household Products (0.1%) | ||||||||
Reckitt Benckiser PLC | 5,821 | 318,642 | ||||||
Insurance (0.1%) | ||||||||
Aviva PLC | 9,015 | 133,812 | ||||||
Media (0.0%) | ||||||||
Taylor Nelson Sofres PLC | 7,966 | 37,650 | ||||||
Metals & Mining (0.1%) | ||||||||
BHP Billiton PLC | 5,862 | 162,823 | ||||||
Vedanta Resources PLC | 641 | 20,660 | ||||||
183,483 | ||||||||
J.P. Morgan NVIT Balanced Fund (Continued)
Common Stocks - Long Positions (continued) | ||||||||
Shares or | ||||||||
Principal Amount | Value | |||||||
UNITED KINGDOM (continued) | ||||||||
Multi-Utility (0.1%) | ||||||||
National Grid PLC | 11,937 | $ | 176,116 | |||||
Multiline Retail (0.1%) | ||||||||
Next PLC | 3,620 | 145,318 | ||||||
Oil, Gas & Consumable Fuels (0.5%) | ||||||||
BG Group PLC | 2,971 | 48,697 | ||||||
BP PLC | 50,391 | 606,260 | ||||||
Royal Dutch Shell PLC | 866 | 36,097 | ||||||
Royal Dutch Shell PLC | 7,078 | 288,123 | ||||||
979,177 | ||||||||
Pharmaceuticals (0.3%) | ||||||||
AstraZeneca PLC | 4,991 | 267,445 | ||||||
GlaxoSmithKline PLC | 13,553 | 353,020 | ||||||
620,465 | ||||||||
Tobacco (0.1%) | ||||||||
Imperial Tobacco Group PLC | 2,100 | 96,813 | ||||||
Trading Companies & Distributors (0.1%) | ||||||||
Ashtead Group PLC | 11,906 | 36,138 | ||||||
Wolseley PLC | 11,418 | 274,001 | ||||||
310,139 | ||||||||
Wireless Telecommunication Services (0.0%) | ||||||||
Vodafone Group PLC | 13,971 | 46,810 | ||||||
5,642,495 | ||||||||
UNITED STATES (52.4%) | ||||||||
Aerospace & Defense (1.6%) | ||||||||
Boeing Co. (The) | 3,400 | 326,944 | ||||||
General Dynamics Corp. | 4,090 | 319,920 | ||||||
Honeywell International, Inc. | 6,100 | 343,308 | ||||||
Lockheed Martin Corp. | 3,705 | 348,752 | ||||||
Northrop Grumman Corp. | 7,000 | 545,090 | ||||||
Orbital Sciences Corp.* | 3,700 | 77,737 | ||||||
Raytheon Co. | 6,260 | 337,351 | ||||||
United Technologies Corp. | 10,600 | 751,858 | ||||||
3,050,960 | ||||||||
Air Freight & Logistics (0.1%) | ||||||||
EGL, Inc.* | 400 | 18,592 | ||||||
Pacer International, Inc. | 4,200 | 98,784 | ||||||
117,376 | ||||||||
Airlines (0.2%) | ||||||||
AMR Corp.* | 2,600 | 68,510 | ||||||
Continental Airlines, Class B* | 5,285 | 179,003 | ||||||
UAL Corp.* | 2,170 | 88,080 | ||||||
335,593 | ||||||||
Auto Components (0.6%) | ||||||||
Aftermarket Technology Corp.* | 2,500 | 74,200 | ||||||
ArvinMeritor, Inc. | 1,725 | 38,295 | ||||||
B.F. Goodrich Co. (The) | 5,300 | 315,668 | ||||||
Johnson Controls, Inc. | 7,000 | 810,390 | ||||||
1,238,553 | ||||||||
Automobiles (0.1%) | ||||||||
Midas, Inc.* | 3,900 | 88,413 | ||||||
Monaco Coach Corp. | 3,000 | 43,050 | ||||||
131,463 | ||||||||
Bank (0.1%) (b) | ||||||||
BNP Paribas | 100,000 | 101,134 | ||||||
Beverages (0.3%) | ||||||||
Coca-Cola Co. | 11,300 | 591,103 | ||||||
Biotechnology (0.5%) | ||||||||
Alkermes, Inc.* | 825 | 12,045 | ||||||
Amgen, Inc.* | 9,600 | 530,784 | ||||||
Celgene Corp.* | 1,200 | 68,796 | ||||||
Cephalon, Inc.* | 100 | 8,039 | ||||||
Exelixis, Inc.* | 3,000 | 36,300 | ||||||
Genentech, Inc.* | 900 | 68,094 | ||||||
Gilead Sciences, Inc.* | 3,100 | 120,187 | ||||||
Human Genome Sciences, Inc.* | 800 | 7,136 | ||||||
Mannkind Corp.* | 700 | 8,631 | ||||||
Martek Biosciences Corp.* | 175 | 4,545 | ||||||
Medivation, Inc.* | 300 | 6,129 | ||||||
Nektar Therapeutics* | 1,550 | 14,710 | ||||||
PerkinElmer, Inc. | 2,925 | 76,225 | ||||||
Telik, Inc.* | 300 | 1,014 | ||||||
Theravance, Inc.* | 400 | 12,800 | ||||||
United Therapeutics Corp.* | 350 | 22,316 | ||||||
Vertex Pharmaceuticals, Inc.* | 100 | 2,856 | ||||||
1,000,607 | ||||||||
Capital Markets (0.6%) | ||||||||
Affiliated Managers Group, Inc.* | 600 | 77,256 | ||||||
Bank of New York Co., Inc. | 2,200 | 91,168 | ||||||
Bear Stearns Cos., Inc. (The) | 2,310 | 323,400 | ||||||
E*TRADE Financial Corp.* | 1,000 | 22,090 | ||||||
Federated Investors, Inc., Class B | 1,600 | 61,328 | ||||||
Lehman Brothers Holding, Inc. | 5,280 | 393,466 | ||||||
TD Ameritrade Holding Corp.* | 8,900 | 178,000 | ||||||
1,146,708 | ||||||||
Chemicals (0.9%) | ||||||||
Air Products & Chemicals, Inc. | 2,600 | 208,962 | ||||||
C.F. Industries Holdings, Inc. | 700 | 41,923 |
Common Stocks - Long Positions (continued) | ||||||||
Shares or | ||||||||
Principal Amount | Value | |||||||
UNITED STATES (continued) | ||||||||
Chemicals (continued) | ||||||||
Dow Chemical Co. (The) | 2,600 | $ | 114,972 | |||||
Innospec, Inc. | 800 | 47,368 | ||||||
Praxair, Inc. | 8,000 | 575,920 | ||||||
Rohm & Haas Co. | 9,400 | 513,992 | ||||||
Spartech Corp. | 2,800 | 74,340 | ||||||
Terra Industries, Inc.* | 4,300 | 109,306 | ||||||
1,686,783 | ||||||||
Commercial Banks (2.2%) | ||||||||
1st Source Corp. | 220 | 5,482 | ||||||
BancFirst Corp. | 2,525 | 108,121 | ||||||
City Holding Co. | 800 | 30,664 | ||||||
Comerica, Inc. | 2,300 | 136,781 | ||||||
Commerce Bancshares, Inc. | 315 | 14,270 | ||||||
FNB Corp. | 1,400 | 50,260 | ||||||
Great Southern Bancorp, Inc. | 2,400 | 64,920 | ||||||
Horizon Financial Corp. | 975 | 21,245 | ||||||
Lakeland Financial Corp. | 200 | 4,254 | ||||||
PNC Bank Corp. | 4,575 | 327,478 | ||||||
Simmons First National Corp., Class A | 2,725 | 75,183 | ||||||
Suffolk Bancorp | 1,525 | 48,678 | ||||||
SunTrust Banks, Inc. | 4,000 | 342,960 | ||||||
Taylor Capital Group, Inc. | 1,000 | 27,530 | ||||||
TCF Financial Corp. | 11,250 | 312,750 | ||||||
U.S. Bancorp | 16,600 | 546,970 | ||||||
Wachovia Corp. | 20,297 | 1,040,221 | ||||||
Wells Fargo & Co. | 29,500 | 1,037,515 | ||||||
4,195,282 | ||||||||
Commercial Services & Supplies (0.3%) | ||||||||
Administaff, Inc. | 1,500 | 50,235 | ||||||
CompX International, Inc. | 925 | 17,113 | ||||||
Diamond Management & Technology Consultants, Inc. | 6,100 | 80,520 | ||||||
Donnelley (R.R.) & Sons Co. | 2,200 | 95,722 | ||||||
M & F Worldwide Corp.* | 2,125 | 141,482 | ||||||
Manpower, Inc. | 1,050 | 96,852 | ||||||
Standard Parking Corp.* | 200 | 7,026 | ||||||
Standard Register Co. | 6,400 | 72,960 | ||||||
Steelcase, Inc. | 300 | 5,550 | ||||||
567,460 | ||||||||
Communications Equipment (1.6%) | ||||||||
Adtran, Inc. | 800 | 20,776 | ||||||
Avocent Corp.* | 800 | 23,208 | ||||||
Black Box Corp. | 1,725 | 71,381 | ||||||
Cisco Systems, Inc.* | 55,680 | 1,550,688 | ||||||
CommScope, Inc.* | 600 | 35,010 | ||||||
Corning, Inc.* | 23,500 | 600,425 | ||||||
Inter-Tel, Inc. | 2,900 | 69,397 | ||||||
InterDigital Communications Corp.* | 1,525 | 49,059 | ||||||
Juniper Networks, Inc.* | 3,500 | 88,095 | ||||||
Motorola, Inc. | 1,300 | 23,010 | ||||||
QUALCOMM, Inc. | 11,000 | 477,290 | ||||||
Tellabs, Inc.* | 5,000 | 53,800 | ||||||
3,062,139 | ||||||||
Computers & Peripherals (2.1%) | ||||||||
Apple, Inc.* | 3,700 | 451,548 | ||||||
Brocade Communications Systems, Inc.* | 9,580 | 74,916 | ||||||
Dell, Inc.* | 300 | 8,565 | ||||||
EMC Corp.* | 2,500 | 45,250 | ||||||
Emulex Corp.* | 5,375 | 117,390 | ||||||
Hewlett-Packard Co. | 29,125 | 1,299,557 | ||||||
Imation Corp. | 2,025 | 74,642 | ||||||
International Business Machines Corp. | 16,440 | 1,730,310 | ||||||
NCR Corp.* | 1,300 | 68,302 | ||||||
Sun Microsystems, Inc.* | 23,100 | 121,506 | ||||||
3,991,986 | ||||||||
Construction & Engineering (0.0%) | ||||||||
Emcor Group, Inc.* | 1,125 | 82,013 | ||||||
Construction Materials (0.0%) | ||||||||
Headwaters, Inc.* | 200 | 3,454 | ||||||
Consumer Finance (0.4%) | ||||||||
American Express Co. | 2,300 | 140,714 | ||||||
AmeriCredit Corp.* | 4,250 | 112,837 | ||||||
Capital One Financial Corp. | 5,200 | 407,888 | ||||||
Credit Acceptance Corp* | 249 | 6,681 | ||||||
Dollar Financial Corp.* | 1,364 | 38,874 | ||||||
World Acceptance Corp.* | 600 | 25,638 | ||||||
732,632 | ||||||||
Consumer Goods (0.1%) | ||||||||
Jarden Corp.* | 2,000 | 86,020 | ||||||
Tempur-Pedic International, Inc. | 3,100 | 80,290 | ||||||
166,310 | ||||||||
Containers & Packaging (0.1%) | ||||||||
Graphic Packaging Corp.* | 10,875 | 52,635 | ||||||
Smurfit-Stone Container Corp.* | 4,650 | 61,892 | ||||||
114,527 | ||||||||
J.P. Morgan NVIT Balanced Fund (Continued)
Common Stocks - Long Positions (continued) | ||||||||
Shares or | ||||||||
Principal Amount | Value | |||||||
UNITED STATES (continued) | ||||||||
Distributor (0.1%) | ||||||||
ProLogis Trust | 3,110 | $ | 176,959 | |||||
Diversified Consumer Services (0.1%) | ||||||||
Coinstar, Inc.* | 2,300 | 72,404 | ||||||
Sotheby’s Holdings, Inc. | 1,850 | 85,137 | ||||||
157,541 | ||||||||
Diversified Financial Services (4.1%) | ||||||||
Bank of America Corp. | 41,000 | 2,004,490 | ||||||
Chicago Mercantile Exchange Holdings, Inc. | 100 | 53,436 | ||||||
CIT Group, Inc. | 8,300 | 455,089 | ||||||
Citigroup, Inc. | 33,900 | 1,738,731 | ||||||
Franklin Resources, Inc. | 5,900 | 781,573 | ||||||
Goldman Sachs Group, Inc. | 2,410 | 522,367 | ||||||
IntercontinentalExchange, Inc.* | 500 | 73,925 | ||||||
Merrill Lynch & Co., Inc. | 5,070 | 423,751 | ||||||
Morgan Stanley | 16,190 | 1,358,017 | ||||||
Morgan Stanley-W/ I* | 1,500 | 104,265 | ||||||
State Street Corp. | 5,000 | 342,000 | ||||||
Thornburg Mortgage, Inc. | 3,150 | 82,467 | ||||||
7,940,111 | ||||||||
Diversified Telecommunication Services (1.8%) | ||||||||
AT&T, Inc. | 46,510 | 1,930,165 | ||||||
CenturyTel, Inc. | 1,780 | 87,309 | ||||||
Citizens Communications Co. | 1,900 | 29,013 | ||||||
Embarq Corp. | 1,647 | 104,370 | ||||||
Qwest Communications International, Inc.* | 20,700 | 200,790 | ||||||
Verizon Communications, Inc. | 26,600 | 1,095,122 | ||||||
3,446,769 | ||||||||
Electric Utilities (1.4%) | ||||||||
American Electric Power Co., Inc. | 5,700 | 256,728 | ||||||
Edison International | 18,700 | 1,049,444 | ||||||
El Paso Electric Co.* | 1,000 | 24,560 | ||||||
FirstEnergy Corp. | 9,790 | 633,707 | ||||||
FPL Group, Inc. | 4,000 | 226,960 | ||||||
Gilead Sciences, Inc. | 7,400 | 209,864 | ||||||
Mirant Corp.* | 1,950 | 83,167 | ||||||
Pinnacle West Capital Corp. | 100 | 3,985 | ||||||
Sierra Pacific Resources* | 12,900 | 226,524 | ||||||
Westar Energy, Inc. | 700 | 16,996 | ||||||
2,731,935 | ||||||||
Electrical Equipment (0.1%) | ||||||||
Acuity Brands, Inc. | 1,400 | 84,392 | ||||||
General Cable Corp.* | 1,510 | 114,383 | ||||||
Rockwell International Corp. | 800 | 55,552 | ||||||
254,327 | ||||||||
Electronic Equipment & Instruments (0.2%) | ||||||||
Avnet, Inc.* | 2,200 | 87,208 | ||||||
Coherent, Inc.* | 2,925 | 89,242 | ||||||
Methode Electronics | 7,300 | 114,245 | ||||||
Mettler Toledo International, Inc.* | 300 | 28,653 | ||||||
MTS Systems Corp. | 2,825 | 126,193 | ||||||
Sanmina Corp.* | 9,700 | 30,361 | ||||||
Tech Data Corp.* | 100 | 3,846 | ||||||
479,748 | ||||||||
Energy Equipment & Services (0.5%) | ||||||||
Baker Hughes, Inc. | 4,300 | 361,759 | ||||||
BJ Services Co. | 2,300 | 65,412 | ||||||
Grey Wolf, Inc.* | 2,100 | 17,304 | ||||||
Halliburton Co. | 4,600 | 158,700 | ||||||
Input/ Output, Inc.* | 5,100 | 79,611 | ||||||
National-OilWell, Inc.* | 850 | 88,604 | ||||||
Tidewater, Inc. | 1,300 | 92,144 | ||||||
Todco* | 825 | 38,948 | ||||||
902,482 | ||||||||
Entertainment (0.6%) | ||||||||
Walt Disney Co. (The) | 32,910 | 1,123,547 | ||||||
Food & Staples Retailing (0.8%) | ||||||||
CVS/ Caremark Corp. | 2,900 | 105,705 | ||||||
Kroger Co. | 12,060 | 339,248 | ||||||
Nasch-Finch Co. | 1,500 | 74,250 | ||||||
Safeway, Inc. | 7,660 | 260,670 | ||||||
SUPERVALU, Inc. | 7,300 | 338,136 | ||||||
SYSCO Corp. | 7,100 | 234,229 | ||||||
Wal-Mart Stores, Inc. | 3,000 | 144,330 | ||||||
1,496,568 | ||||||||
Food Products (0.5%) | ||||||||
General Mills, Inc. | 2,950 | 172,339 | ||||||
Kellogg Co. | 2,300 | 119,117 | ||||||
Kraft Foods, Inc. | 18,500 | 652,125 | ||||||
Wrigley (Wm.) Jr. Co., Class A | 2,100 | 116,151 | ||||||
1,059,732 | ||||||||
Gas Utilities (0.1%) | ||||||||
Energen Corp. | 1,680 | 92,299 | ||||||
NICOR, Inc. | 2,725 | 116,957 | ||||||
209,256 | ||||||||
Common Stocks - Long Positions (continued) | ||||||||
Shares or | ||||||||
Principal Amount | Value | |||||||
UNITED STATES (continued) | ||||||||
Health Care Equipment & Supplies (0.4%) | ||||||||
Advanced Medical Optics, Inc.* | 700 | $ | 24,416 | |||||
Baxter International, Inc. | 2,200 | 123,948 | ||||||
Datascope Corp. | 825 | 31,581 | ||||||
Hologic, Inc.* | 400 | 22,124 | ||||||
Invacare Corp. | 3,400 | 62,322 | ||||||
Medtronic, Inc. | 2,500 | 129,650 | ||||||
Mentor Corp. | 3,225 | 131,193 | ||||||
Thoratec Corp.* | 1,000 | 18,390 | ||||||
Zimmer Holdings, Inc.* | 3,600 | 305,604 | ||||||
849,228 | ||||||||
Health Care Providers & Services (1.7%) | ||||||||
Aetna, Inc. | 15,540 | 767,676 | ||||||
Apria Healthcare Group, Inc.* | 1,600 | 46,032 | ||||||
CIGNA Corp. | 5,460 | 285,121 | ||||||
Healthways, Inc.* | 300 | 14,211 | ||||||
Humana, Inc.* | 1,360 | 82,838 | ||||||
Laboratory Corp. of America Holdings* | 1,010 | 79,043 | ||||||
Landauer, Inc. | 1,400 | 68,950 | ||||||
LCA-VISION, Inc. | 1,800 | 85,068 | ||||||
Magellan Health Services, Inc.* | 1,525 | 70,867 | ||||||
McKesson Corp. | 6,640 | 396,009 | ||||||
Medcath Corp.* | 1,400 | 44,520 | ||||||
Medco Health Solutions, Inc.* | 3,300 | 257,367 | ||||||
Sunrise Senior Living, Inc.* | 400 | 15,996 | ||||||
UnitedHealth Group, Inc. | 1,500 | 76,710 | ||||||
WellPoint, Inc.* | 13,180 | 1,052,159 | ||||||
3,342,567 | ||||||||
Health Care Technology (0.1%) | ||||||||
TriZetto Group, Inc. (The)* | 4,075 | 78,892 | ||||||
Wellcare Health Plans, Inc.* | 930 | 84,174 | ||||||
163,066 | ||||||||
Hotels, Restaurants & Leisure (0.6%) | ||||||||
AFC Enterprises, Inc.* | 3,300 | 57,057 | ||||||
Domino’s Pizza, Inc. | 2,600 | 47,502 | ||||||
International Game Technology | 1,300 | 51,610 | ||||||
McDonald’s Corp. | 12,020 | 610,135 | ||||||
Monarch Casino & Resort, Inc.* | 2,000 | 53,700 | ||||||
Papa John’s International, Inc.* | 1,400 | 40,264 | ||||||
Starwood Hotels & Resorts Worldwide, Inc. | 3,700 | 248,159 | ||||||
Wyndham Worldwide Corp.* | 2,100 | 76,146 | ||||||
1,184,573 | ||||||||
Household Durables (0.2%) | ||||||||
American Greetings Corp., Class A | 2,925 | 82,865 | ||||||
Beazer Homes U.S.A., Inc. | 500 | 12,335 | ||||||
Blyth Industries, Inc. | 600 | 15,948 | ||||||
Centex Corp. | 2,000 | 80,200 | ||||||
CSS Industries, Inc. | 200 | 7,922 | ||||||
D. R. Horton, Inc. | 1,000 | 19,930 | ||||||
Lennar Corp., Class A | 1,300 | 47,528 | ||||||
Toll Brothers, Inc.* | 4,400 | 109,912 | ||||||
376,640 | ||||||||
Household Products (1.1%) | ||||||||
Colgate-Palmolive Co. | 2,200 | 142,670 | ||||||
Energizer Holdings, Inc.* | 980 | 97,608 | ||||||
Kimberly-Clark Corp. | 4,965 | 332,109 | ||||||
Procter & Gamble Co. (The) | 24,700 | 1,511,393 | ||||||
2,083,780 | ||||||||
Independent Power Producers & Energy Traders (0.0%) | ||||||||
Dynegy, Inc.* | 1,632 | 15,406 | ||||||
Industrial Conglomerates (1.2%) | ||||||||
3M Co. | 2,400 | 208,296 | ||||||
General Electric Co. | 48,500 | 1,856,580 | ||||||
Teleflex, Inc. | 1,625 | 132,892 | ||||||
Textron, Inc. | 500 | 55,055 | ||||||
2,252,823 | ||||||||
Insurance (2.1%) | ||||||||
AFLAC, Inc. | 4,300 | 221,020 | ||||||
Allstate Corp. | 4,640 | 285,406 | ||||||
AMBAC Financial Group, Inc. | 6,100 | 531,859 | ||||||
American Financial Group, Inc. | 2,370 | 80,935 | ||||||
American International Group, Inc. | 3,400 | 238,102 | ||||||
Argonaut Group, Inc. | 700 | 21,847 | ||||||
Assurant, Inc. | 1,400 | 82,488 | ||||||
Chubb Corp. (The) | 7,580 | 410,381 | ||||||
Conseco, Inc.* | 1,750 | 36,558 | ||||||
Genworth Financial, Inc. | 18,200 | 626,080 | ||||||
Great American Financial Resources, Inc. | 2,950 | 71,361 | ||||||
Hartford Financial Services Group, Inc. (The) | 1,800 | 177,318 | ||||||
LandAmerica Financial Group, Inc. | 400 | 38,596 | ||||||
Loews Corp. | 3,500 | 178,430 | ||||||
MBIA, Inc. | 5,900 | 367,098 | ||||||
MetLife, Inc. | 3,000 | 193,440 | ||||||
Navigators Group, Inc. (The)* | 500 | 26,950 | ||||||
Odyssey Re Holdings Corp. | 400 | 17,156 | ||||||
ProAssurance Corp.* | 400 | 22,268 |
J.P. Morgan NVIT Balanced Fund (Continued)
Common Stocks - Long Positions (continued) | ||||||||
Shares or | ||||||||
Principal Amount | Value | |||||||
UNITED STATES (continued) | ||||||||
Insurance (continued) | ||||||||
Protective Life Corp. | 2,600 | $ | 124,306 | |||||
Travelers Cos., Inc. (The) | 6,670 | 356,845 | ||||||
4,108,444 | ||||||||
Internet & Catalog Retail (0.0%) | ||||||||
Priceline.com, Inc.* | 500 | 34,370 | ||||||
Internet Software & Services (0.8%) | ||||||||
Asiainfo Holdings, Inc.* | 700 | 6,790 | ||||||
CMGI, Inc.* | 3,800 | 7,410 | ||||||
eBay, Inc.* | 9,700 | 312,146 | ||||||
Google, Inc., Class A* | 1,600 | 837,408 | ||||||
Infospace, Inc. | 200 | 4,642 | ||||||
SonicWALL, Inc.* | 3,250 | 27,917 | ||||||
ValueClick, Inc.* | 1,900 | 55,974 | ||||||
Yahoo!, Inc.* | 12,700 | 344,551 | ||||||
1,596,838 | ||||||||
IT Services (0.3%) | ||||||||
Acxiom Corp. | 400 | 10,580 | ||||||
Affiliated Computer Services, Inc., Class A* | 1,400 | 79,408 | ||||||
Authorize.Net Holdings, Inc.* | 700 | 12,523 | ||||||
BISYS Group, Inc. (The)* | 1,000 | 11,830 | ||||||
Computer Sciences Corp.* | 1,300 | 76,895 | ||||||
Convergys Corp.* | 2,270 | 55,025 | ||||||
CSG Systems International, Inc.* | 400 | 10,604 | ||||||
Electronic Data Systems Corp. | 3,040 | 84,299 | ||||||
Paychex, Inc. | 2,500 | 97,800 | ||||||
Unisys Corp.* | 5,175 | 47,299 | ||||||
486,263 | ||||||||
Leisure Equipment & Products (0.3%) | ||||||||
Hasbro, Inc. | 5,040 | 158,307 | ||||||
Marvel Entertainment, Inc.* | 7,300 | 186,004 | ||||||
Mattel, Inc. | 3,470 | 87,756 | ||||||
Sturm Ruger & Co., Inc.* | 3,900 | 60,528 | ||||||
492,595 | ||||||||
Life Sciences Tools & Services (0.0%) | ||||||||
Advanced Magnetics, Inc.* | 100 | 5,816 | ||||||
Illumina, Inc.* | 525 | 21,310 | ||||||
27,126 | ||||||||
Machinery (1.3%) | ||||||||
AGCO Corp.* | 400 | 17,364 | ||||||
Caterpillar, Inc. | 8,950 | 700,785 | ||||||
Cummins, Inc. | 1,170 | 118,416 | ||||||
Danaher Corp. | 3,100 | 234,050 | ||||||
Dover Corp. | 5,700 | 291,555 | ||||||
Eaton Corp. | 3,400 | 316,200 | ||||||
Freightcar America, Inc. | 600 | 28,704 | ||||||
Illinois Tool Works, Inc. | 2,100 | 113,799 | ||||||
Manitowoc Co. | 1,390 | 111,728 | ||||||
Nordson Corp. | 1,225 | 61,446 | ||||||
PACCAR, Inc. | 3,800 | 330,752 | ||||||
Parker Hannifin Corp. | 1,000 | 97,910 | ||||||
Terex Corp.* | 1,190 | 96,747 | ||||||
Wabtec Corp. | 1,700 | 62,101 | ||||||
2,581,557 | ||||||||
Media (1.0%) | ||||||||
CBS Corp., Class B | 5,100 | 169,932 | ||||||
Charter Communications, Inc.* | 3,400 | 13,770 | ||||||
Citadel Broadcasting Co. | 898 | 5,792 | ||||||
Comcast Corp., Class A* | 10,450 | 293,854 | ||||||
Cumulus Media, Inc.* | 1,400 | 13,090 | ||||||
DIRECTV Group, Inc.* | 3,300 | 76,263 | ||||||
E.W. Scripps Co., Class A | 900 | 41,121 | ||||||
EchoStar Communications Corp., Class A* | 1,700 | 73,729 | ||||||
Entercom Communications Corp. | 1,600 | 39,824 | ||||||
Liberty Media Holding Corp. - Capital, Series A* | 750 | 88,260 | ||||||
McGraw-Hill Cos., Inc. (The) | 4,895 | 333,252 | ||||||
News Corp. | 23,700 | 502,677 | ||||||
Omnicom Group, Inc. | 2,160 | 114,307 | ||||||
Sinclair Broadcast Group, Inc. | 6,575 | 93,496 | ||||||
Viacom, Inc., Class B* | 400 | 16,652 | ||||||
1,876,019 | ||||||||
Metals & Mining (1.0%) | ||||||||
Alcoa, Inc. | 8,300 | 336,399 | ||||||
Chaparral Steel | 900 | 64,683 | ||||||
Cleveland Cliffs, Inc. | 600 | 46,602 | ||||||
Freeport-McMoRan Copper & Gold, Inc., Class B | 3,768 | 312,066 | ||||||
Nucor Corp. | 4,840 | 283,866 | ||||||
Quanex Corp. | 950 | 46,265 | ||||||
Southern Copper Corp. | 3,760 | 354,417 | ||||||
Steel Dynamics, Inc. | 2,490 | 104,356 | ||||||
U.S. Steel Corp. | 4,140 | 450,225 | ||||||
1,998,879 | ||||||||
Multi-Utilities (0.5%) | ||||||||
CenterPoint Energy, Inc. | 4,660 | 81,084 | ||||||
CMS Energy Corp. | 11,000 | 189,200 | ||||||
Detroit Edison Co. | 200 | 9,644 | ||||||
Dominion Resources, Inc. | 1,000 | 86,310 |
Common Stocks - Long Positions (continued) | ||||||||
Shares or | ||||||||
Principal Amount | Value | |||||||
UNITED STATES (continued) | ||||||||
Multi-Utilities (continued) | ||||||||
Northwestern Corp. | 1,725 | $ | 54,872 | |||||
PG&E Corp. | 2,900 | 131,370 | ||||||
Scana Corp. | 1,600 | 61,264 | ||||||
Sempra Energy | 1,355 | 80,257 | ||||||
Xcel Energy, Inc. | 9,400 | 192,418 | ||||||
886,419 | ||||||||
Multiline Retail (1.2%) | ||||||||
Big Lots, Inc.* | 6,250 | 183,875 | ||||||
Family Dollar Stores, Inc. | 2,400 | 82,368 | ||||||
J.C. Penney Co., Inc. | 8,760 | 634,049 | ||||||
Kohl’s Corp.* | 7,900 | 561,137 | ||||||
Macy’s, Inc. | 6,310 | 251,012 | ||||||
Saks, Inc. | 5,000 | 106,750 | ||||||
Target Corp. | 7,700 | 489,720 | ||||||
2,308,911 | ||||||||
Office Electronics (0.1%) | ||||||||
Xerox Corp.* | 12,010 | 221,945 | ||||||
Oil, Gas & Consumable Fuels (4.7%) | ||||||||
ChevronTexaco Corp. | 15,330 | 1,291,399 | ||||||
Citic Resources Finance (c) | 200,000 | 193,000 | ||||||
ConocoPhillips | 11,900 | 934,150 | ||||||
Devon Energy Corp. | 2,600 | 203,554 | ||||||
EOG Resources, Inc. | 3,000 | 219,180 | ||||||
Exxon Mobil Corp. | 38,180 | 3,202,539 | ||||||
Forest Oil Corp.* | 1,050 | 44,373 | ||||||
Frontier Oil Corp. | 1,300 | 56,901 | ||||||
Global Industries Ltd.* | 2,925 | 78,449 | ||||||
Harvest Natural Resources, Inc.* | 600 | 7,146 | ||||||
Hess Corp. | 4,400 | 259,424 | ||||||
Holly Corp. | 1,520 | 112,769 | ||||||
Marathon Oil Corp. | 5,990 | 359,160 | ||||||
Mariner Energy, Inc.* | 809 | 19,618 | ||||||
Meridian Resource Corp. (The)* | 6,200 | 18,724 | ||||||
Occidental Petroleum Corp. | 8,800 | 509,344 | ||||||
Overseas Shipholding Group, Inc. | 1,280 | 104,192 | ||||||
Plains Exploration & Production Co.* | 2,525 | 120,720 | ||||||
Pride International, Inc.* | 3,100 | 116,126 | ||||||
Swift Energy Co.* | 600 | 25,656 | ||||||
Tesoro Petroleum Corp. | 1,700 | 97,155 | ||||||
USEC, Inc.* | 1,300 | 28,574 | ||||||
Valero Energy Corp. | 5,390 | 398,105 | ||||||
Western Refining, Inc. | 1,700 | 98,260 | ||||||
XTO Energy, Inc. | 8,300 | 498,830 | ||||||
8,997,348 | ||||||||
Paper & Forest Products (0.1%) | ||||||||
Buckeye Technologies, Inc.* | 1,300 | 20,111 | ||||||
Domtar Corp.* | 17,900 | 199,764 | ||||||
219,875 | ||||||||
Personal Products (0.1%) | ||||||||
Avon Products, Inc. | 1,300 | 47,775 | ||||||
NBTY, Inc.* | 2,380 | 102,816 | ||||||
Playtex Products, Inc.* | 4,975 | 73,680 | ||||||
224,271 | ||||||||
Pharmaceuticals (3.6%) | ||||||||
Abbott Laboratories | 17,700 | 947,835 | ||||||
Acadia Pharmaceuticals, Inc.* | 1,100 | 15,037 | ||||||
Adams Respiratory Therapeutics, Inc.* | 500 | 19,695 | ||||||
Alexion Pharmaceuticals, Inc.* | 450 | 20,277 | ||||||
Arena Pharmaceuticals, Inc.* | 700 | 7,693 | ||||||
Auxilium Pharmaceuticals, Inc.* | 600 | 9,564 | ||||||
Bristol-Myers Squibb Co. | 1,000 | 31,560 | ||||||
CombinatoRX Inc* | 500 | 3,085 | ||||||
Cubist Pharmaceuticals, Inc.* | 825 | 16,261 | ||||||
Cypress Bioscience, Inc.* | 825 | 10,939 | ||||||
Eli Lilly & Co. | 200 | 11,176 | ||||||
Forest Laboratories, Inc., Class A* | 3,960 | 180,774 | ||||||
Johnson & Johnson | 3,800 | 234,156 | ||||||
Keryx Biopharmaceuticals, Inc.* | 800 | 7,816 | ||||||
King Pharmaceuticals, Inc.* | 4,720 | 96,571 | ||||||
Merck & Co., Inc. | 32,935 | 1,640,163 | ||||||
MGI Pharma, Inc.* | 600 | 13,422 | ||||||
Mylan Laboratories, Inc. | 3,720 | 67,667 | ||||||
Nastech Pharmaceutical Co., Inc.* | 925 | 10,092 | ||||||
Pfizer, Inc. | 38,240 | 977,797 | ||||||
Pozen, Inc.* | 800 | 14,456 | ||||||
Progenics Pharmaceuticals, Inc.* | 375 | 8,089 | ||||||
Regeneron Pharmaceuticals, Inc.* | 900 | 16,128 | ||||||
Savient Pharmaceuticals, Inc.* | 1,900 | 23,598 | ||||||
Schering-Plough Corp. | 41,100 | 1,251,084 | ||||||
Sepracor, Inc.* | 4,400 | 180,488 | ||||||
Viropharma, Inc.* | 3,325 | 45,885 | ||||||
Watson Pharmaceutical, Inc.* | 2,100 | 68,313 | ||||||
Wyeth | 17,500 | 1,003,450 | ||||||
6,933,071 | ||||||||
Real Estate Investment Trusts (REITs) (0.8%) | ||||||||
Annaly Mortgage Management, Inc. | 6,400 | 92,288 | ||||||
Anthracite Capital, Inc. | 6,475 | 75,757 | ||||||
Apartment Investment & Management Co. | 1,700 | 85,714 |
J.P. Morgan NVIT Balanced Fund (Continued)
Common Stocks - Long Positions (continued) | ||||||||
Shares or | ||||||||
Principal Amount | Value | |||||||
UNITED STATES (continued) | ||||||||
Real Estate Investment Trusts (continued) | ||||||||
Boston Properties, Inc. | 1,700 | $ | 173,621 | |||||
Cousins Properties, Inc. | 3,525 | 102,260 | ||||||
Equity Inns, Inc. | 3,200 | 71,680 | ||||||
Equity Lifestyle Properties, Inc. | 1,100 | 57,409 | ||||||
Home Properties of New York, Inc. | 400 | 20,772 | ||||||
Hospitality Properties Trust | 6,140 | 254,749 | ||||||
Host Hotels & Resorts, Inc. | 4,100 | 94,792 | ||||||
iStar Financial, Inc. | 1,830 | 81,124 | ||||||
Mid-America Apartment Communities, Inc. | 125 | 6,560 | ||||||
Pennsylvania Real Estate Investment Trust | 500 | 22,165 | ||||||
Post Properties, Inc. | 700 | 36,491 | ||||||
Ramco-Gershenson Properties Trust | 2,775 | 99,706 | ||||||
Sunstone Hotel Investors, Inc. | 4,325 | 122,787 | ||||||
UDR, Inc. | 2,800 | 73,640 | ||||||
Winston Hotels, Inc. | 3,325 | 49,875 | ||||||
1,521,390 | ||||||||
Real Estate Management & Development (0.1%) | ||||||||
CB Richard Ellis Group, Inc., Class A* | 2,270 | 82,855 | ||||||
Jones Lang Lasalle, Inc. | 930 | 105,555 | ||||||
188,410 | ||||||||
Road & Rail (0.7%) | ||||||||
Arkansas Best Corp. | 400 | 15,588 | ||||||
Burlington Northern Santa Fe Corp. | 4,800 | 408,672 | ||||||
Con-way, Inc. | 600 | 30,144 | ||||||
Norfolk Southern Corp. | 12,600 | 662,382 | ||||||
Union Pacific Corp. | 1,550 | 178,482 | ||||||
1,295,268 | ||||||||
Semiconductors & Semiconductor Equipment (1.3%) | ||||||||
Altera Corp. | 14,500 | 320,885 | ||||||
Amkor Technology, Inc.* | 6,100 | 96,075 | ||||||
Applied Materials, Inc. | 14,920 | 296,460 | ||||||
Asyst Technologies, Inc.* | 1,000 | 7,230 | ||||||
Broadcom Corp.* | 8,600 | 251,550 | ||||||
Cirrus Logic, Inc.* | 4,625 | 38,387 | ||||||
Credence Systems Corp.* | 2,100 | 7,560 | ||||||
Cymer, Inc.* | 1,725 | 69,345 | ||||||
Intel Corp. | 4,900 | 116,424 | ||||||
KLA-Tencor Corp. | 500 | 27,475 | ||||||
Lam Research Corp.* | 1,810 | 93,034 | ||||||
LSI Logic Corp.* | 17,225 | 129,360 | ||||||
Maxim Integrated Products, Inc. | 200 | 6,682 | ||||||
MEMC Electronic Materials, Inc.* | 1,410 | 86,179 | ||||||
Micrel, Inc. | 4,625 | 58,830 | ||||||
OmniVision Technologies, Inc.* | 1,850 | 33,504 | ||||||
On Semiconductor Corp.* | 8,750 | 93,800 | ||||||
Silicon Storage Technology, Inc.* | 1,900 | 7,087 | ||||||
Texas Instruments, Inc. | 4,400 | 165,572 | ||||||
Varian Semiconductor Equipment Associates., Inc.* | 1,960 | 78,518 | ||||||
Xilinx, Inc. | 19,300 | 516,661 | ||||||
Zoran Corp.* | 400 | 8,016 | ||||||
2,508,634 | ||||||||
Software (1.8%) | ||||||||
Aspen Technology, Inc.* | 5,950 | 83,300 | ||||||
BMC Software, Inc.* | 6,690 | 202,707 | ||||||
Cadence Design Systems, Inc.* | 4,240 | 93,110 | ||||||
Compuware Corp.* | 8,600 | 101,996 | ||||||
EPIQ Systems, Inc.* | 1,725 | 27,876 | ||||||
eSPEED, Inc.* | 700 | 6,048 | ||||||
Fair Issac Corp. | 200 | 8,024 | ||||||
Magma Design Automation, Inc.* | 900 | 12,636 | ||||||
McAfee, Inc.* | 2,900 | 102,080 | ||||||
Microsoft Corp. | 60,050 | 1,769,674 | ||||||
MicroStrategy, Inc.* | 400 | 37,796 | ||||||
Oracle Corp.* | 36,035 | 710,250 | ||||||
Pegasystems, Inc. | 700 | 7,651 | ||||||
Sybase, Inc.* | 1,650 | 39,419 | ||||||
Symantec Corp.* | 6,950 | 140,390 | ||||||
Synopsys, Inc.* | 6,015 | 158,976 | ||||||
3,501,933 | ||||||||
Specialty Retail (1.1%) | ||||||||
Abercrombie & Fitch Co. | 2,400 | 175,152 | ||||||
Advance Auto Parts, Inc. | 1,500 | 60,795 | ||||||
American Eagle Outfitters Ltd. | 3,330 | 85,448 | ||||||
AutoZone, Inc.* | 650 | 88,803 | ||||||
Barnes & Noble, Inc. | 2,125 | 81,749 | ||||||
Best Buy Co., Inc. | 1,000 | 46,670 | ||||||
Blockbuster, Inc.* | 2,100 | 9,051 | ||||||
Books-A-Million, Inc. | 900 | 15,246 | ||||||
Carmax, Inc.* | 6,600 | 168,300 | ||||||
Coach, Inc.* | 5,300 | 251,167 | ||||||
CSK Auto Corp.* | 1,050 | 19,320 | ||||||
Dick’s Sporting Goods, Inc.* | 900 | 52,353 | ||||||
Home Depot, Inc. (The) | 1,700 | 66,895 | ||||||
Nike, Inc. | 6,700 | 390,543 | ||||||
Payless ShoeSource, Inc.* | 4,150 | 130,932 |
Common Stocks - Long Positions (continued) | ||||||||
Shares or | ||||||||
Principal Amount | Value | |||||||
UNITED STATES (continued) | ||||||||
Specialty Retail (continued) | ||||||||
RadioShack Corp. | 2,600 | $ | 86,164 | |||||
Sherwin Williams Co. | 1,305 | 86,743 | ||||||
Staples, Inc. | 14,000 | 332,220 | ||||||
TJX Cos., Inc. | 1,100 | 30,250 | ||||||
2,177,801 | ||||||||
Telephones (0.0%) | ||||||||
Consolidated Communications Holdings, Inc. | 2,300 | 51,980 | ||||||
Rural Cellular Corp.* | 1,000 | 43,810 | ||||||
95,790 | ||||||||
Textiles, Apparel & Luxury Goods (0.1%) | ||||||||
Phillips-Van Heusen Corp. | 1,630 | 98,729 | ||||||
Thrifts & Mortgage Finance (0.6%) | ||||||||
Clayton Holdings, Inc.* | 1,300 | 14,807 | ||||||
Corus Bankshares, Inc. | 1,325 | 22,870 | ||||||
Countrywide Credit Industries, Inc. | 5,600 | 203,560 | ||||||
Fannie Mae | 7,950 | 519,373 | ||||||
Federal Agricultural Mortgage Corp., Class C | 4,175 | 142,868 | ||||||
Freddie Mac | 400 | 24,280 | ||||||
MGIC Investment Corp. | 4,500 | 255,870 | ||||||
Ocwen Financial Corp.* | 700 | 9,331 | ||||||
1,192,959 | ||||||||
Tobacco (1.2%) | ||||||||
Alliance One International, Inc.* | 12,200 | 122,610 | ||||||
Altria Group, Inc. | 25,020 | 1,754,903 | ||||||
Loews Corp. - Carolina Group | 1,275 | 98,519 | ||||||
Reynolds American, Inc. | 4,680 | 305,136 | ||||||
UST, Inc. | 1,670 | 89,696 | ||||||
2,370,864 | ||||||||
Trading Companies & Distributors (0.1%) | ||||||||
BlueLinx Holdings, Inc. | 3,700 | 38,813 | ||||||
Grainger (W.W.), Inc. | 1,700 | 158,185 | ||||||
196,998 | ||||||||
Wireless Telecommunication Services (0.1%) | ||||||||
Dobson Communications Corp., Class A* | 5,575 | 61,938 | ||||||
Sprint Nextel Corp. | 8,300 | 171,894 | ||||||
U.S.A. Mobility, Inc. | 400 | 10,704 | ||||||
244,536 | ||||||||
100,950,384 | ||||||||
Total Common Stocks — Long Positions (Cost $109,541,447) | 128,901,082 | |||||||
Aerospace & Defense (0.0%) | ||||||||
L-3 Communications Corp., 5.88%, 01/15/15 | $ | 15,000 | $ | 13,912 | ||||
Automobiles (0.0%) | ||||||||
Ford Motor Credit Co. LLC, 7.80%, 06/01/12 | 15,000 | 14,633 | ||||||
TRW Automotive, Inc., 7.25%, 03/15/17 (d) | 5,000 | 4,762 | ||||||
19,395 | ||||||||
Banks (1.0%) | ||||||||
Credit Agricole, 6.64%, 05/31/49 | 125,000 | 121,508 | ||||||
Depfa ACS Bank, 5.13%, 03/16/37 (d) | 280,000 | 256,567 | ||||||
Glitner Banki HF, 5.80%, 01/21/11 (b) (d) | 240,000 | 241,327 | ||||||
HBOS PLC, 5.92%, 09/29/49 (d) | 200,000 | 187,573 | ||||||
HBOS Treasury Services NY, 5.25%, 02/21/17 (d) | 275,000 | 269,793 | ||||||
Kaupthing Bank, 5.75%, 10/04/11 (d) | 145,000 | 144,500 | ||||||
Lloyds TSB Group PLC, 6.27%, 12/31/49 (b) (d) | 95,000 | 90,125 | ||||||
Mizuho Capital Investment 1 Ltd., 6.69%, 06/30/46 (d) (e) | 94,000 | 92,946 | ||||||
Societe Generale, 5.92%, 12/31/49 (d) | 155,000 | 150,076 | ||||||
Standard Chartered PLC, 6.41%, 12/01/47 | 200,000 | 190,723 | ||||||
Woori Bank, 5.75%, 03/13/14 (d) | 160,000 | 160,010 | ||||||
1,905,148 | ||||||||
Commercial Services & Supplies (0.0%) (d) | ||||||||
Quebecor World Capital Corp., 8.75%, 03/15/16 | 10,000 | 9,850 | ||||||
Consumer Finance (0.3%) | ||||||||
Core Invest Grade Trust, 4.64%, 11/30/07 | 583,696 | 581,449 | ||||||
J.P. Morgan NVIT Balanced Fund (Continued)
Corporate Bonds (continued) | |||||||||
Shares or | |||||||||
Principal Amount | Value | ||||||||
Consumer Goods (0.0%) | |||||||||
Constellation Brands, Inc., 7.25%, 09/01/16 | $ | 15,000 | $ | 14,625 | |||||
Jostens, Inc., 7.63%, 10/01/12 | 15,000 | 14,925 | |||||||
29,550 | |||||||||
Diversified Financial Services (0.3%) | |||||||||
Countrywide Home Loans, 5.80%, 06/07/12 | 280,000 | 278,029 | |||||||
Residential Capital Corp., 6.38%, 06/30/10 | 360,000 | 355,353 | |||||||
633,382 | |||||||||
Electric Power (0.4%) | |||||||||
Appalachian Power Co., 5.80%, 10/01/35 | 110,000 | 101,376 | |||||||
Dominion Resources, Inc. 5.15%, 07/15/15 | 120,000 | 113,977 | |||||||
7.20%, 09/15/14 | 95,000 | 103,773 | |||||||
8.13%, 06/15/10 | 50,000 | 53,840 | |||||||
ITC Holdings, Corp., 6.38%, 09/30/36 (d) | 50,000 | 48,026 | |||||||
MidAmerican Energy Holdings Co., 6.13%, 04/01/36 | 170,000 | 164,238 | |||||||
NRG Energy, Inc., 7.38%, 02/01/16 | 15,000 | 15,038 | |||||||
Ohio Power Co., 6.00%, 06/01/16 | 80,000 | 80,076 | |||||||
Pacificorp, 4.30%, 09/15/08 | 125,000 | 123,336 | |||||||
803,680 | |||||||||
Energy Companies (0.2%) | |||||||||
Chesapeake Energy Corp., 6.50%, 08/15/17 | 20,000 | 18,950 | |||||||
Kinder Morgan Energy Partners, 6.50%, 02/01/37 | 130,000 | 125,050 | |||||||
Oneok Partners LP 5.90%, 04/01/12 | 115,000 | 115,553 | |||||||
259,553 | |||||||||
Entertainment (0.0%) | |||||||||
WMG Holdings Corp. 0.00%, 12/15/14 | 10,000 | 7,600 | |||||||
Gaming (0.0%) | |||||||||
MGM Mirage, Inc., 5.88%, 02/27/14 | 30,000 | 27,150 | |||||||
Health Care Providers & Services (0.0%) | |||||||||
Fresenius Medical Capital Trust II, 7.88%, 02/01/08 | 45,000 | 45,450 | |||||||
HCA, Inc. (d) 9.25%, 11/15/16 | 10,000 | 10,650 | |||||||
9.63%, 11/15/16 | 10,000 | 10,750 | |||||||
66,850 | |||||||||
Insurance (0.2%) | |||||||||
Stingray Pass Through, 5.90%, 01/12/15 (d) | 180,000 | 166,855 | |||||||
XLCapital Ltd., 6.50%, 12/31/49 | 220,000 | 206,621 | |||||||
373,476 | |||||||||
Manufacturing (0.2%) | |||||||||
Beazer Homes USA, Inc., 6.88%, 07/15/15 | 30,000 | 25,800 | |||||||
Daimler Chrysler NA Holding Corp., 4.75%, 01/15/08 | 125,000 | 124,568 | |||||||
Georgia-Pacific Corp., 7.70%, 06/15/15 | 25,000 | 24,750 | |||||||
Huntsman LLC, 11.50%, 07/15/12 | 30,000 | 33,300 | |||||||
Nalco Co., 7.75%, 11/15/11 | 10,000 | 10,075 | |||||||
Owens Corning, Inc., 7.00%, 12/01/36 (d) | 120,000 | 116,929 | |||||||
Owens-Brockway Glass Container, 8.25%, 05/15/13 | 10,000 | 10,350 | |||||||
Polyone Corp., 10.63%, 05/15/10 | 6,000 | 6,300 | |||||||
Sealy Mattress Co., 8.25%, 06/15/14 | 25,000 | 25,625 | |||||||
WMG Acquisition Corp., 7.38%, 04/15/14 | 15,000 | 13,950 | |||||||
391,647 | |||||||||
Media (0.0%) | |||||||||
DIRECTV Holdings LLC, 6.38%, 06/15/15 | 20,000 | 18,800 | |||||||
Multiline Retail (0.1%) | |||||||||
Wal-Mart Stores Inc., 5.38%, 04/05/17 | 150,000 | 145,682 | |||||||
Corporate Bonds (continued) | |||||||||
Shares or | |||||||||
Principal Amount | Value | ||||||||
Oil, Gas & Consumable Fuels (0.4%) | |||||||||
Canadian Natural Resources, 6.25%, 03/15/38 | $ | 65,000 | $ | 61,502 | |||||
Gazprom Intl SA, 7.20%, 02/01/20 | 175,000 | 180,635 | |||||||
Qatar Petroleum, 5.58%, 05/30/11 (d) | 195,558 | 195,508 | |||||||
Ras Laffan, 5.83%, 09/30/16 (d) | 250,000 | 245,778 | |||||||
Valero Energy Corp., 6.63%, 06/15/37 | 90,000 | 89,585 | |||||||
773,008 | |||||||||
Other Financial (3.1%) | |||||||||
American General Finance Corp., 4.50%, 11/15/07 | 330,000 | 329,090 | |||||||
Arch Western Finance, 6.75%, 07/01/13 | 10,000 | 9,600 | |||||||
Axa SA, 6.47%, 12/31/49 (d) | 110,000 | 99,228 | |||||||
Capital One Finance, 7.69%, 08/15/36 | 50,000 | 51,495 | |||||||
Citigroup/ Deutsche Bank Commercial Mortgage, 5.32%, 12/11/49 | 520,000 | 498,811 | |||||||
Corrections Corp. of America, 6.25%, 03/15/13 | 10,000 | 9,600 | |||||||
Ford Motor Credit Co., 6.93%, 01/15/10 (b) | 15,000 | 14,802 | |||||||
General Motors Acceptance Corp., 6.88%, 08/28/12 | 25,000 | 24,433 | |||||||
Goldman Sachs Group, Inc. 5.63%, 01/15/17 | 105,000 | 100,633 | |||||||
5.79%, 12/29/49 | 150,000 | 146,392 | |||||||
5.95%, 01/15/27 | 150,000 | 140,941 | |||||||
Iirsa Norte Finance Ltd., 8.75%, 05/30/24 | 105,044 | 123,427 | |||||||
K. Hovnanian Enterprises, 8.63%, 01/15/17 | 10,000 | 9,600 | |||||||
Lehman Brothers Holdings, 5.25%, 02/06/12 | 165,000 | 162,183 | |||||||
Lehman Brothers Capital Trust VII, 5.86%, 11/29/49 | 135,000 | 132,240 | |||||||
Lehman Brothers Holdings, 5.75%, 01/03/17 | 135,000 | 131,153 | |||||||
Liberty Mutual Group, 7.50%, 08/15/36 (d) | 105,000 | 106,488 | |||||||
Lincoln National Corp., 7.00%, 05/17/66 | 140,000 | 143,651 | |||||||
Merrill Lynch & Co., 6.22%, 09/15/26 | 110,000 | 107,174 | |||||||
MetLife, Inc., 6.40%, 12/15/36 | 100,000 | 92,635 | |||||||
Mizuho JGB Investment, 9.87%, 12/31/49 (d) (e) | 190,000 | 197,509 | |||||||
Mizuho Preferred Capital, 8.79%, 12/29/49 (d) (e) | 310,000 | 319,085 | |||||||
MUFG Capital Finance 1 Ltd., 6.35%, 07/29/49 (e) | 100,000 | 98,258 | |||||||
Pricoa Global Funding I, 3.90%, 12/15/08 (d) | 400,000 | 390,970 | |||||||
Regions Financing Trust II, 6.63%, 05/15/47 | 150,000 | 143,485 | |||||||
Reinsurance Group of America, Inc., 6.75%, 12/15/65 | 105,000 | 102,333 | |||||||
Residential Capital Corp., 6.13%, 11/21/08 | 315,000 | 312,125 | |||||||
Shinsei Finance, 7.09%, 07/25/16 (b) (d) | 225,000 | 224,227 | |||||||
SMFG Preferred Capital, 6.08%, 12/31/49 (d) | 215,000 | 206,832 | |||||||
SocGen Real Estate LLC, 7.64%, 12/29/49 (d) (e) | 90,000 | 90,437 | |||||||
Suntrust Preferred Capital I, 5.85%, 12/31/49 | 150,000 | 149,095 | |||||||
Swiss RE Capital I LP, 6.85%, 05/25/49 (d) | 300,000 | 301,771 | |||||||
Travellers Companies Inc, 6.25%, 03/15/67 | 135,000 | 129,728 | |||||||
Ukraine Government, 6.88%, 03/04/11 | 170,000 | 173,230 | |||||||
United Mexican States, 8.00%, 09/24/22 | 225,000 | 269,550 | |||||||
Verizon Global Funding Corp., 5.85%, 09/15/35 | 85,000 | 77,962 | |||||||
Washington Mutual, 6.67%, 12/15/16 (d) | 200,000 | 190,927 | |||||||
Washington Mutual PFD FDG, 6.63%, 12/31/49 (d) | 200,000 | 193,024 | |||||||
6,004,124 | |||||||||
Service Companies (0.3%) | |||||||||
Acco Brands Corp., 7.63%, 08/15/15 | 25,000 | 24,563 | |||||||
Charter Communications LLC, 8.00%, 04/30/12 (d) | 20,000 | 20,250 |
J.P. Morgan NVIT Balanced Fund (Continued)
Corporate Bonds (continued) | |||||||||
Shares or | |||||||||
Principal Amount | Value | ||||||||
Service Companies (continued) | |||||||||
CVS Corp., 6.04%, 12/10/28 (d) | $ | 123,670 | $ | 120,025 | |||||
Home Depot, Inc., 5.88%, 12/16/36 | 125,000 | 111,375 | |||||||
Iron Mountain, Inc. 6.63%, 01/01/16 | 35,000 | 32,113 | |||||||
7.75%, 01/15/15 | 10,000 | 9,750 | |||||||
Service Corporation International, 7.38%, 10/01/14 | 30,000 | 30,150 | |||||||
Time Warner, Inc. 5.88%, 11/15/16 (d) | 125,000 | 121,575 | |||||||
6.50%, 11/15/36 | 85,000 | 80,705 | |||||||
6.55%, 05/01/37 (d) | 95,000 | 91,818 | |||||||
642,324 | |||||||||
Telephones (0.5%) | |||||||||
AT&T, Inc., 6.80%, 05/15/36 | 195,000 | 201,961 | |||||||
Consolidated Communications Holdings, 9.75%, 04/01/12 | 15,000 | 15,712 | |||||||
Dobson Cellular Systems, 8.38%, 11/01/11 | 10,000 | 10,450 | |||||||
Echostar DBS Corp., 7.13%, 02/01/16 | 15,000 | 14,662 | |||||||
Qwest Communications International, 8.86%, 02/15/09 (b) | 14,000 | 14,140 | |||||||
Qwest Corp., 8.88%, 03/15/12 | 5,000 | 5,388 | |||||||
Sprint Nextel Corp, 6.00%, 12/01/16 | 300,000 | 284,596 | |||||||
Telefonica Emisiones, 5.86%, 02/04/13 | 260,000 | 259,436 | |||||||
Verizon Communications, Inc., 6.25%, 04/01/37 | 40,000 | 38,569 | |||||||
844,914 | |||||||||
Transportation (0.1%) (d) | |||||||||
Nakilat, Inc., 6.07%, 12/31/33 | 130,000 | 121,818 | |||||||
Total Corporate Bonds (Cost $14,063,018) | 13,673,312 | ||||||||
Commercial Paper (6.0%) | |||||||||
Alpine Securitization, 5.33%, 07/03/07 (f) | 1,000,000 | 999,850 | |||||||
Atlantic Asset Securitization LLC, 5.29%, 07/18/07 | 1,000,000 | 997,610 | |||||||
Barton Capital Corporation, 5.34%, 07/12/07 (f) | 1,000,000 | 998,390 | |||||||
Cafco LLC, 5.33%, 07/17/07 (f) | 1,000,000 | 997,662 | |||||||
Cancara Asset Securitisation LLC, 5.35%, 07/12/07 (f) | 1,000,000 | 998,387 | |||||||
CRC Funding LLC, 5.35%, 07/31/07 (f) | 750,000 | 746,703 | |||||||
Galleon Capital, 5.35%, 07/09/07 (f) | 1,000,000 | 998,950 | |||||||
Lexington Parker Capital Company, 5.32%, 07/09/07 (f) | 1,000,000 | 998,834 | |||||||
Market Street Funding, 5.35%, 07/09/07 (f) | 750,000 | 749,212 | |||||||
Ranger Funding Co, 5.36%, 07/17/07 (f) | 750,000 | 748,237 | |||||||
Scaldis Capital LLC, 5.34%, 07/10/07 (f) | 1,000,000 | 998,800 | |||||||
Ticonderoga Funding LLC, 5.27%, 07/06/07 (f) | 1,250,000 | 1,249,250 | |||||||
Total Commercial Paper (Cost $11,481,137) | 11,481,885 | ||||||||
Mortgage-Backed Obligations (16.6%) | |||||||||
Federal Home Loan Mortgage Corporation | |||||||||
5.00%, 11/15/28 | 552,888 | 546,691 | |||||||
5.85%, 11/01/36 | 699,812 | 701,840 | |||||||
6.00%, 02/01/35 | 189,603 | 188,194 | |||||||
6.50%, 09/25/33 | 349,897 | 353,799 | |||||||
6.50%, 05/15/35 | 242,951 | 247,197 | |||||||
6.75%, 03/15/31 | 375,000 | 429,168 | |||||||
Federal Home Loan Mortgage Corporation TBA | |||||||||
5.00%, 08/15/36 | 157,000 | 147,089 | |||||||
5.50%, 08/15/36 | 720,000 | 694,125 | |||||||
5.50%, 07/15/37 | 685,000 | 660,597 |
Mortgage-Backed Obligations (continued) | |||||||||
Shares or | |||||||||
Principal Amount | Value | ||||||||
Federal National Mortgage Association | |||||||||
5.25%, 09/15/16 | $ | 990,000 | $ | 975,281 | |||||
6.50%, 10/25/33 | 322,011 | 325,581 | |||||||
6.50%, 10/25/33 | 322,011 | 325,581 | |||||||
6.50%, 12/25/33 | 315,001 | 318,566 | |||||||
6.50%, 12/25/33 | 271,128 | 274,231 | |||||||
6.50%, 01/25/34 | 276,066 | 279,250 | |||||||
6.50%, 02/01/35 | 324,742 | 328,226 | |||||||
6.63%, 11/15/30 | 30,000 | 33,809 | |||||||
Federal National Mortgage Association TBA | |||||||||
4.50%, 08/15/21 | 550,000 | 521,812 | |||||||
4.50%, 07/01/35 | 600,000 | 545,437 | |||||||
5.00%, 08/01/33 | 2,690,000 | 2,519,352 | |||||||
5.00%, 07/01/37 | 1,260,000 | 1,180,462 | |||||||
5.50%, 07/15/22 | 586,000 | 577,210 | |||||||
5.50%, 07/01/37 | 1,650,000 | 1,545,844 | |||||||
6.00%, 08/01/17 | 1,135,000 | 1,139,610 | |||||||
6.00%, 06/01/22 | 6,280,000 | 6,307,475 | |||||||
6.00%, 08/15/36 | 570,000 | 563,410 | |||||||
6.50%, 08/15/36 | 1,210,000 | 1,220,210 | |||||||
6.50%, 07/15/37 | 1,550,000 | 1,564,531 | |||||||
7.00%, 04/01/37 | 3,345,015 | 3,434,634 | |||||||
7.00%, 04/01/37 | 527,847 | 541,989 | |||||||
Government National Mortgage Association TBA | |||||||||
5.50%, 07/15/35 | 815,000 | 790,804 | |||||||
6.00%, 07/15/35 | 690,000 | 686,335 | |||||||
6.50%, 07/01/34 | 1,185,000 | 1,203,516 | |||||||
Merrill Lynch/ Countrywide Commercial Mtge 5.49%, 03/12/51 | 245,000 | 237,366 | |||||||
5.81%, 06/12/50 | 595,000 | 589,197 | |||||||
Total Mortgage-Backed Obligations (Cost $32,238,605) | 31,998,419 | ||||||||
Asset-Backed Securities (6.7%) | |||||||||
Americredit Automobile Receivables Trust, Series 04-BM, Class A4, 2.67%, 03/07/11 | 360,505 | 355,995 | |||||||
Bear Stearns Commercial Mortgage Securities, Series 04-PWR6, Class A4, 4.52%, 11/11/41 | 260,000 | 248,668 | |||||||
Bear Stearns Commercial Mortgage Securities, Series 05-PWR7, Class A3, 5.12%, 02/11/41 | 380,000 | 364,585 | |||||||
Capital One Multi-Asset Execution Trust, Series 03-A4, Class A4, Series 03-C4, Class C4, 3.65%, 07/15/11 | 520,000 | 509,872 | |||||||
Citigroup Commercial Mortgage Trust, Series 06-C4, Class A3, 5.72%, 03/15/49 (b) | 265,000 | 263,906 | |||||||
Countrywide Alternative Loan Trust, Series 04-28CB, Class 3A1, 6.00%, 01/25/35 | 551,229 | 541,669 | |||||||
Countrywide Alternative Loan Trust, Series 06-J5, Class 1A1, 6.50%, 09/25/36 | 740,704 | 742,558 | |||||||
Countrywide Asset-Backed Certificates, Series 03-5, Class MF1, 5.41%, 01/25/34 | 180,000 | 177,754 | |||||||
Credit Suisse Mortgage Capital Certificates, Series 06-C3, Class A3, 5.91%, 06/15/38 | 400,000 | 400,983 | |||||||
CS First Boston Mortgage Securities Corp., Series 01-CK1, Class A3, 6.38%, 12/18/35 | 270,000 | 276,022 | |||||||
CS First Boston Mortgage Securities Corp., Series 03-29, Class 7A1, 6.50%, 12/25/33 | 86,332 | 86,785 | |||||||
CS First Boston Mortgage Securities Corp., Series 03-C4, Class A4, 5.14%, 08/15/36 | 480,000 | 465,967 | |||||||
First Horizon Alternative Mortgage Securities, Series 2006-FA4, Class 1A1, 6.00%, 08/25/36 | 457,677 | 455,108 | |||||||
Ford Credit Auto Owner Trust, Series 06-B, Class A3, 5.26%, 10/15/10 | 875,000 | 873,628 | |||||||
Greenwich Capital Commercial Funding Corp., Series 04-GG1, Class A3, 4.34%, 06/10/36 | 1,185,000 | 1,167,834 |
J.P. Morgan NVIT Balanced Fund (Continued)
Asset-Backed Securities (continued) | ||||||||
Shares or | ||||||||
Principal Amount | Value | |||||||
Greenwich Capital Commercial Funding Corp., Series 2007-GG9, Class A4, 5.44%, 03/10/39 | $ | 360,000 | $ | 348,523 | ||||
Greenwich Capital Commercial Funding Corp., Series 05-GG3, Class A4, 4.80%, 08/10/42 | 285,000 | 268,118 | ||||||
Indymac Index Mortgage Loan Trust, Series 04-AR7, Class A1, 5.76%, 09/25/34 (b) | 162,803 | 163,566 | ||||||
LB-UBS Commercial Mortgage Trust, Series 05-C1, Class A4, 4.74%, 02/15/30 | 485,000 | 455,053 | ||||||
LB-UBS Commercial Mortgage Trust, Series 06-C1, Class A4, 5.16%, 02/15/31 | 250,000 | 238,803 | ||||||
LB-UBS Commercial Mortgage Trust, Series 06-C4, Class A4, 5.90%, 06/15/38 (b) | 190,000 | 191,385 | ||||||
MBNA Credit Card Master Note Trust, Series 03-A1, Class A1, 3.30%, 07/15/10 | 485,000 | 479,016 | ||||||
Merrill Lynch Mortgage Trust, Series 06-C1, Class A4, 5.84%, 05/12/39 | 120,000 | 119,145 | ||||||
Morgan Stanley Capital I, Series 07-IQ13, Class A4, 5.36%, 03/15/44 | 350,000 | 336,394 | ||||||
Morgan Stanley Capital I, Series 04-HQ3, Class A2, 4.05%, 01/13/41 | 390,000 | 378,343 | ||||||
Morgan Stanley Capital I, Series 05, Class IQ9, 4.70%, 07/15/56 | 265,000 | 247,667 | ||||||
Morgan Stanley Capital I, Series 2007-HQ11, Class A4, 5.45%, 02/20/44 (b) | 275,000 | 265,886 | ||||||
Morgan Stanley Dean Witter Capital I, Series 03-HQ2, Class A2, 4.92%, 03/12/35 | 250,000 | 240,682 | ||||||
Onyx Acceptance Auto Trust, Series 03-D, Class A4, 3.20%, 03/15/10 | 51,705 | 51,165 | ||||||
Onyx Acceptance Auto Trust, Series 04-C, Class A4, 3.50%, 12/15/11 | 290,849 | 287,485 | ||||||
PSE&G Transition Funding LLC, Series 01-1, Class A6, 6.61%, 06/15/15 | 240,000 | 251,357 | ||||||
Residential Asset Securities Corp., Series 02-KS4, Class AIIB, 5.82%, 07/25/32 (b) | 13,732 | 13,736 | ||||||
Residential Asset Securities Corp., Series 03-KS5, Class AIIB, 5.90%, 07/25/33 (b) | 21,767 | 21,774 | ||||||
Special Underwriting & Residential Finance, Series 06-BC2, Class A2B, 5.57%, 02/25/37 | 750,000 | 745,898 | ||||||
Triad Auto Receivables Owner Trust, Series 03-B, Class A4, 3.20%, 12/13/10 | 119,246 | 117,431 | ||||||
Volkswagen Auto Loan Enhanced Trust, Series 03-2, Class A4, 2.94%, 03/22/10 | 116,869 | 115,767 | ||||||
Wachovia Asset Securitization, Inc., Series 03-HE2, Class A1, 5.58%, 07/25/33 (b) | 56,105 | 54,345 | ||||||
Wachovia Bank Commercial Mortgage Trust, Series 06-C26, Class A3, 6.01%, 06/15/45 | 265,000 | 267,413 | ||||||
Wmalt Mortgage Pass-Through Certificates, Series 06-5, Class 2CB1, 6.00%, 07/25/36 | 308,915 | 306,841 | ||||||
Total Asset-Backed Securities (Cost $13,221,518) | 12,897,127 | |||||||
Cash Equivalent (4.7%) (b) | ||||||||
AIM Liquid Assets Portfolio | 9,098,653 | 9,098,653 | ||||||
Sovereign Bonds (0.5%) | ||||||||
Federal Republic of Brazil, 12.25%, 03/06/30 | 45,000 | 76,050 | ||||||
Republic of Argentina, 5.48%, 08/03/12 (b) | 205,000 | 149,650 | ||||||
Republic of Guatemala, 9.25%, 08/01/13 | 50,000 | 58,313 |
Sovereign Bonds (continued) | |||||||||
Shares or | |||||||||
Principal Amount | Value | ||||||||
Republic of Peru 6.55%, 03/14/37 | $ | 141,600 | $ | 142,308 | |||||
7.35%, 07/21/25 | 75,000 | 83,475 | |||||||
Russian Federation, 12.75%, 06/24/28 | 100,000 | 176,197 | |||||||
Ukraine Government 6.58%, 11/21/16 (d) | 100,000 | 99,125 | |||||||
6.58%, 11/21/16 | 210,000 | 212,205 | |||||||
Total Sovereign Bonds (Cost $990,992) | 997,323 | ||||||||
Options Purchased (0.0%) | |||||||||
Federal Funds Put Option, expiring July 2007 (strike price 94.75) | 25 | 261 | |||||||
Federal Funds Put Option, expiring July 2007 (strike price 94.813) | 18 | 4,500 | |||||||
U.S. Put Note Option, expiring Sep 2007 (strike price 101) | 4 | 125 | |||||||
U.S. Put Note Option, expiring Sep 2007 (strike price 102) | 4 | 875 | |||||||
Total Options Purchased (Cost $6,894) | 5,761 | ||||||||
U.S. Government Sponsored & Agency Obligations (0.8%) | |||||||||
United States (0.8%) | |||||||||
U.S. Treasury Bills, 5.03%, 08/09/07 | $ | 40,000 | 39,810 | ||||||
U.S. Treasury Bonds, 8.88%, 02/15/19 | 200,000 | 264,500 | |||||||
U.S. Treasury Notes 4.63%, 02/29/08 | 1,195,000 | 1,191,733 | |||||||
5.13%, 06/30/08 | 10,000 | 10,009 | |||||||
Total U.S. Government Sponsored & Agency Obligations (Cost $1,479,886) | 1,506,052 | ||||||||
United States (1.1%) | |||||||||
Federal National Mortgage Association TBA | 2,150,000 | 2,073,406 | |||||||
United States (0.1%) | |||||||||
U.S. Treasury Notes 4.13%, 05/15/15 | 175,000 | 164,924 | |||||||
4.25%, 11/30/07 | 25,000 | 24,934 | |||||||
4.50%, 02/15/36 | 55,000 | 49,801 | |||||||
4.75%, 05/31/12 | 45,000 | 44,648 | |||||||
Total U.S. Treasury Notes (Cost $290,706) | 284,307 | ||||||||
Total Investments (Cost $194,480,702) (d) — 110.6% | 212,917,327 | ||||||||
Liabilities in excess of other assets — (10.6)% | (20,404,740 | ||||||||
NET ASSETS — 100.0% | $ | 192,512,587 | |||||||
* | Denotes a non-income producing security. | |
(a) | Fair Valued Security. | |
(b) | Variable Rate Security. The rate reflected in the Statement of Investments is the rate in effect on June 30, 2007. The maturity date represents the actual maturity date. | |
(c) | Illiquid security. | |
(d) | See notes to financial statements for tax unrealized appreciation (depreciation) of securities. | |
(e) | Perpetual bond. This is a bond that has no maturity date, is redeemable and pays a steady stream of interest indefinitely. | |
(f) | The rate reflected in the Statement of Investments is the effective yield as of June 30, 2007. |
ADR | American Depository Receipt | |
AMBAC | Insured by American Municipal Bond Insurance Corp. | |
BM | Bermuda | |
LP | Limited Partnership | |
MBIA | Insured by Municipal Bond Insurance Organization | |
TBA | To Be Announced. |
J.P. Morgan NVIT Balanced Fund (Continued)
At June 30, 2007, the Fund’s open forward foreign currency contracts against the United States Dollar were as follows:
Currency | Unrealized | |||||||||||||||||||
Date | Received/ | Contract | Market | Appreciation/ | ||||||||||||||||
Currency | Delivery | (Delivered) | Value | Value | (Depreciation) | |||||||||||||||
Short Contract: | ||||||||||||||||||||
Australia Dollar | 08/07/07 | (215,580 | ) | $ | (178,878 | ) | $ | (182,534 | ) | $ | (3,656 | ) | ||||||||
Swiss Franc | 08/07/07 | (160,759 | ) | (131,921 | ) | (132,031 | ) | (110 | ) | |||||||||||
Euro | 08/07/07 | (943,306 | ) | (1,281,610 | ) | (1,278,276 | ) | 3,334 | ||||||||||||
British Sterling Pound | 08/07/07 | (72,449 | ) | (143,329 | ) | (145,395 | ) | (2,066 | ) | |||||||||||
Hong Kong Dollar | 08/07/07 | (3,040,065 | ) | (389,647 | ) | (389,198 | ) | 449 | ||||||||||||
Japanese Yen | 08/07/07 | (8,943,844 | ) | (75,241 | ) | (73,023 | ) | 2,218 | ||||||||||||
Norwegian Krone | 08/07/07 | (1,123,554 | ) | (188,014 | ) | (190,758 | ) | (2,744 | ) | |||||||||||
Total Short Contracts | $ | (2,388,640 | ) | $ | (2,391,215 | ) | $ | (2,575 | ) | |||||||||||
Long Contracts: | ||||||||||||||||||||
Australia Dollar | 08/07/07 | 706,385 | $ | 577,137 | $ | 598,106 | $ | 20,969 | ||||||||||||
Swiss Franc | 08/07/07 | 493,679 | 409,203 | 405,459 | (3,744 | ) | ||||||||||||||
Euro | 08/07/07 | 267,000 | 359,019 | 361,812 | 2,793 | |||||||||||||||
British Sterling Pound | 08/07/07 | 132,119 | 262,270 | 265,143 | 2,873 | |||||||||||||||
Norwegian Krone | 08/07/07 | 898,577 | 149,135 | 152,562 | 3,427 | |||||||||||||||
Swedish Krone | 08/07/07 | 3,394,024 | 504,958 | 497,385 | (7,573 | ) | ||||||||||||||
Singapore Dollar | 08/07/07 | 186,527 | 123,606 | 122,279 | (1,327 | ) | ||||||||||||||
Total Long Contracts | $ | 2,385,328 | $ | 2,402,746 | $ | 17,418 | ||||||||||||||
At June 30, 2007, the Fund’s open futures contracts were as follows:
Market Value | Unrealized | |||||||||||||||
Number of | Covered by | Appreciation | ||||||||||||||
Contracts | Long Contracts | Expiration | Contracts | (Depreciation) | ||||||||||||
13 | CAC40 10 Euro | 09/21/07 | $ | 1,075,548 | $ | (1,296 | ) | |||||||||
8 | DAX INDEX | 09/30/07 | 2,186,540 | 37,402 | ||||||||||||
16 | DJ EURO STOXX 50 | 09/30/07 | 977,630 | (12,788 | ) | |||||||||||
9 | LONG GILT | 09/15/07 | 1,874,526 | (35,240 | ) | |||||||||||
15 | HANG SENG IDX | 07/31/07 | 2,098,281 | (5,861 | ) | |||||||||||
3 | JPN 10Y | 09/10/07 | 3,216,879 | 14,265 | ||||||||||||
$ | 11,429,404 | $ | (3,518 | ) | ||||||||||||
Market Value | Unrealized | |||||||||||||||
Number of | Covered by | Appreciation | ||||||||||||||
Contracts | Short Contracts | Expiration | Contracts | (Depreciation) | ||||||||||||
8 | S&P ASX 200 IDX | 09/21/07 | $ | (1,064,079 | ) | $ | 19,903 | |||||||||
6 | S&P/ TSE 60 IX | 09/30/07 | (906,930 | ) | (22,561 | ) | ||||||||||
5 | IBEX 35 INDEX | 07/31/07 | (1,003,072 | ) | 16,718 | |||||||||||
9 | EURO-BUND | 09/06/07 | (1,348,910 | ) | 11,491 | |||||||||||
11 | FTSE 100 | 09/21/07 | (1,466,137 | ) | 15,493 | |||||||||||
17 | TOPIX INDX | 09/30/07 | (2,451,060 | ) | 5,869 | |||||||||||
$ | (8,240,188 | ) | $ | 46,913 | ||||||||||||
The following is a summary of written option activity for the period ended June 30, 2007, by the Fund (Dollar amounts in thousands):
Premiums | ||||||||
Call Options Received | To Contract | Received | ||||||
Balance at beginning of period | 2 | $ | 1 | |||||
Options written | 44 | 5 | ||||||
Options expired | (14 | ) | (2 | ) | ||||
Options outstanding at end of period | 32 | $ | 4 | |||||
At June 30, 2007, the Fund had the following outstanding options:
WRITTEN OPTION CONTRACTS
Unrealized | ||||||||||||||||||||||||||||
Expiration | Exercise | Number of | Premiums | Appreciation | ||||||||||||||||||||||||
Contracts | Type | Date | Price | Contracts | Received | Value | (Depreciation) | |||||||||||||||||||||
Fed Funds Option | Put | August 2007 | 103.00 | 16 | $ | 1,391 | $ | 1,000 | $ | (391 | ) | |||||||||||||||||
Fed Funds Option | Put | August 2007 | 103.50 | 8 | 352 | 1250 | 898 | |||||||||||||||||||||
Fed Funds Option | Put | September 2007 | 102.00 | 4 | 676 | 250 | (426 | ) | ||||||||||||||||||||
Fed Funds Option | Put | September 2007 | 103.00 | 4 | 1,238 | 438 | (800 | ) | ||||||||||||||||||||
NET UNREALIZED APPRECIATION ON WRITTEN OPTION CONTRACTS | $ | (719 | ) | |||||||||||||||||||||||||
J.P. Morgan NVIT Balanced Fund
Common Stocks - Short Positions (0.0%) | ||||||||
Shares or | ||||||||
Principal Amount | Value | |||||||
UNITED STATES (0.0%) | ||||||||
Consumer Finance (0.0%) | ||||||||
Discovery Financial Services* | $ | 100 | $ | 2,850 | ||||
Mortgage-Backed Obligations — Short Positions (1.4%) | ||||||||
Federal National Mortgage Association TBA, 5.50%, 08/01/19 | 30,000 | 29,541 | ||||||
Federal National Mortgage Association TBA, 6.50%, 08/01/30 | 120,000 | 121,013 | ||||||
Federal National Mortgage Association TBA, 6.50%, 07/15/37 | 1,990,000 | 2,008,656 | ||||||
Federal National Mortgage Association TBA, 7.00%, 07/01/36 | 550,000 | 564,609 | ||||||
Total Mortgage-Backed Obligations — Short Positions (Proceeds $2,723,380) | 2,723,819 | |||||||
Total Securities Sold Short (Proceeds $2,726,343) (a) — 1.4% | $ | 2,726,669 | ||||||
* | Denotes a non-income producing security. | |
(a) | See notes to financial statements for tax unrealized appreciation (depreciation) of securities. |
TBA | To Be Announced. |
See accompanying notes to financial statements.
J.P. Morgan | ||||||
NVIT | ||||||
Balanced Fund | ||||||
Assets: | ||||||
Investments, at value (cost $194,480,702) | $ | 212,917,327 | ||||
Deposits with brokers for futures | 5,063 | |||||
Foreign currencies, at value (cost $384,120) | 389,203 | |||||
Interest and dividends receivable | 703,557 | |||||
Receivable for capital shares issued | 40,587 | |||||
Receivable for investments sold | 34,377,301 | |||||
Unrealized appreciation on forward foreign currency contracts | 37,147 | |||||
Reclaims receivable | 47,708 | |||||
Receivable for variation margin on futures contracts | 64,821 | |||||
Prepaid expenses | 2,080 | |||||
Total Assets | 248,584,794 | |||||
Liabilities: | ||||||
Payable to custodian | 274,073 | |||||
Call options written, at value (premiums received $3,657) | 2,938 | |||||
Payable for investments purchased | 52,780,519 | |||||
Unrealized depreciation on forward foreign currency contracts | 22,304 | |||||
Payable for capital shares redeemed | 74,231 | |||||
Securities sold short, at value (Proceeds $2,726,343) | 2,726,669 | |||||
Accrued expenses and other payables: | ||||||
Investment advisory fees | 116,328 | |||||
Fund administration and transfer agent fees | 22,497 | |||||
Administrative servicing fees | 20,212 | |||||
Compliance program costs | 2,694 | |||||
Other | 29,742 | |||||
Total Liabilities | 56,072,207 | |||||
Net Assets | $ | 192,512,587 | ||||
Represented by: | ||||||
Capital | $ | 167,342,881 | ||||
Accumulated net investment loss | (6,385 | ) | ||||
Accumulated net realized gains from investment transactions, futures, options and foreign currency transactions | 6,610,651 | |||||
Net unrealized appreciation on investments, futures, options and translation of assets and liabilities denominated in foreign currencies | 18,565,440 | |||||
Net Assets | $ | 192,512,587 | ||||
Net Assets: | ||||||
Class I Shares | $ | 144,902,727 | ||||
Class IV Shares | 47,609,860 | |||||
Total | $ | 192,512,587 | ||||
Shares outstanding (unlimited number of shares authorized): | ||||||
Class I Shares | 13,068,845 | |||||
Class IV Shares | 4,293,432 | |||||
Total | 17,362,277 | |||||
Net asset value and offering price per share (Net assets by class divided by shares outstanding by class, respectively.): | ||||||
Class I Shares | $ | 11.09 | ||||
Class IV Shares | $ | 11.09 | ||||
28
J.P. Morgan | |||||
NVIT | |||||
Balanced Fund | |||||
INVESTMENT INCOME: | |||||
Interest income | $ | 1,898,920 | |||
Dividend income | 1,485,459 | ||||
Foreign tax withholding | (18,101 | ) | |||
Total Income | 3,366,278 | ||||
Expenses: | |||||
Investment advisory fees | 717,708 | ||||
Fund administration and transfer agent fees | 93,381 | ||||
Administrative servicing fees Class I Shares | 108,089 | ||||
Administrative servicing fees Class IV Shares | 32,233 | ||||
Custodian fees | 374 | ||||
Trustee fees | 4,667 | ||||
Compliance program costs (Note 3) | 1,400 | ||||
Other | 39,358 | ||||
Total expenses before earnings credit | 997,210 | ||||
Earnings credit (Note 6) | (187 | ) | |||
Net Expenses | 997,023 | ||||
Net Investment Income | 2,369,255 | ||||
REALIZED/ UNREALIZED GAINS (LOSSES) FROM INVESTMENTS: | |||||
Net realized gains on investment transactions | 8,043,218 | ||||
Net realized losses on futures transactions | (908,370 | ) | |||
Net realized losses on option transactions | (11,973 | ) | |||
Net realized gains on foreign currency transactions | 89,850 | ||||
Net realized gains on investment transactions, futures, options and foreign currency transactions | 7,212,725 | ||||
Net change in unrealized appreciation on investments, futures, options and translation of assets and liabilities denominated in foreign currencies | 113,742 | ||||
Net realized/unrealized gains (losses) on investments, futures, options and translation of assets and liabilities denominated in foreign currencies | 7,326,467 | ||||
CHANGE IN NET ASSETS RESULTING FROM OPERATIONS | $ | 9,695,722 | |||
29
J.P. Morgan NVIT Balanced Fund | |||||||||
Six Months Ended | Year Ended | ||||||||
June 30, 2007 | December 31, 2006 | ||||||||
(Unaudited) | |||||||||
FROM INVESTMENT ACTIVITIES: | |||||||||
Operations: | |||||||||
Net investment income | $ | 2,369,255 | $ | 4,751,767 | |||||
Net realized gains on investment transactions, futures, options and foreign currency transactions | 7,212,725 | 10,980,152 | |||||||
Net change in unrealized appreciation on investments, futures, options and translation of assets and liabilities denominated in foreign currencies | 113,742 | 8,226,471 | |||||||
Change in net assets resulting from operations | 9,695,722 | 23,958,390 | |||||||
Distributions to shareholders from: | |||||||||
Net investment income: | |||||||||
Class I | (1,840,990 | ) | (3,718,752 | ) | |||||
Class IV | (591,757 | ) | (1,110,742 | ) | |||||
Net realized gains: | |||||||||
Class I | (3,971,841 | ) | – | ||||||
Class IV | (1,304,687 | ) | – | ||||||
Change in net assets from shareholder distributions | (7,709,275 | ) | (4,829,494 | ) | |||||
Change in net assets from capital transactions | (12,212,103 | ) | (42,763,019 | ) | |||||
Change in net assets | (10,225,656 | ) | (23,634,123 | ) | |||||
Net Assets: | |||||||||
Beginning of period | 202,738,243 | 226,372,366 | |||||||
End of period | $ | 192,512,587 | $ | 202,738,243 | |||||
Accumulated net investment income (loss) at end of period | $ | (6,385 | ) | $ | 57,107 | ||||
CAPITAL TRANSACTIONS: | |||||||||
Class I Shares | |||||||||
Proceeds from shares issued | $ | 3,229,346 | $ | 6,957,239 | |||||
Dividends reinvested | 5,812,807 | 3,718,752 | |||||||
Cost of shares redeemed | (20,634,002 | ) | (49,098,573 | ) | |||||
(11,591,849 | ) | (38,422,582 | ) | ||||||
Class IV Shares | |||||||||
Proceeds from shares issued | 1,203,915 | 1,636,045 | |||||||
Dividends reinvested | 1,896,436 | 1,110,742 | |||||||
Cost of shares redeemed | (3,720,605 | ) | (7,087,224 | ) | |||||
(620,254 | ) | (4,340,437 | ) | ||||||
Change in net assets from capital transactions | $ | (12,212,103 | ) | $ | (42,763,019 | ) | |||
30
J.P. Morgan NVIT Balanced Fund | |||||||||
Six Months Ended | Year Ended | ||||||||
June 30, 2007 | December 31, 2006 | ||||||||
(Unaudited) | |||||||||
SHARE TRANSACTIONS: | |||||||||
Class I Shares | |||||||||
Issued | 287,290 | 671,394 | |||||||
Reinvested | 525,237 | 356,176 | |||||||
Redeemed | (1,827,213 | ) | (4,746,078 | ) | |||||
(1,014,686 | ) | (3,718,508 | ) | ||||||
Class IV Shares | |||||||||
Issued | 106,107 | 156,782 | |||||||
Reinvested | 171,383 | 106,328 | |||||||
Redeemed | (329,420 | ) | (682,448 | ) | |||||
(51,930 | ) | (419,338 | ) | ||||||
Total change in shares | (1,066,616 | ) | (4,137,846 | ) | |||||
31
Distributions | ||||||||||||||||||||||||||||||||||||
Investment Activities | ||||||||||||||||||||||||||||||||||||
Net | ||||||||||||||||||||||||||||||||||||
Realized and | ||||||||||||||||||||||||||||||||||||
Net Asset | Unrealized | Total | ||||||||||||||||||||||||||||||||||
Value, | Net | Gains | from | Net | Net | Net Asset | ||||||||||||||||||||||||||||||
Beginning | Investment | (Losses) on | Investment | Investment | Realized | Total | Value, End | Total | ||||||||||||||||||||||||||||
of Period | Income | Investments | Activities | Income | Gains | Distributions | of Period | Return (a) | ||||||||||||||||||||||||||||
Class I Shares | ||||||||||||||||||||||||||||||||||||
For the year ended December 31, 2002 | $ | 9.40 | $ | 0.19 | $ | (1.34 | ) | $ | (1.15 | ) | $ | (0.19 | ) | $ | – | $ | (0.19 | ) | $ | 8.06 | (12.31% | ) | ||||||||||||||
For the year ended December 31, 2003 | $ | 8.06 | $ | 0.15 | $ | 1.32 | $ | 1.47 | $ | (0.15 | ) | $ | – | $ | (0.15 | ) | $ | 9.38 | 18.41% | |||||||||||||||||
For the year ended December 31, 2004 | $ | 9.38 | $ | 0.19 | $ | 0.60 | $ | 0.79 | $ | (0.19 | ) | $ | – | $ | (0.19 | ) | $ | 9.98 | 8.49% | |||||||||||||||||
For the year ended December 31, 2005 | $ | 9.98 | $ | 0.20 | $ | 0.05 | $ | 0.25 | $ | (0.20 | ) | $ | – | $ | (0.20 | ) | $ | 10.03 | 2.54% | |||||||||||||||||
For the year ended December 31, 2006 | $ | 10.03 | $ | 0.24 | $ | 0.97 | $ | 1.21 | $ | (0.24 | ) | $ | – | $ | (0.24 | ) | $ | 11.00 | 12.25% | |||||||||||||||||
For the six months ended June 30, 2007 (Unaudited) | $ | 11.00 | $ | 0.14 | $ | 0.40 | $ | 0.54 | $ | (0.14 | ) | $ | (0.31 | ) | $ | (0.45 | ) | $ | 11.09 | 4.98% | ||||||||||||||||
Class IV Shares | ||||||||||||||||||||||||||||||||||||
For the year ended December 31, 2003 (e) | $ | 8.23 | $ | 0.11 | $ | 1.16 | $ | 1.27 | $ | (0.12 | ) | $ | – | $ | (0.12 | ) | $ | 9.38 | 15.47% | |||||||||||||||||
For the year ended December 31, 2004 | $ | 9.38 | $ | 0.19 | $ | 0.60 | $ | 0.79 | $ | (0.19 | ) | $ | – | $ | (0.19 | ) | $ | 9.98 | 8.54% | |||||||||||||||||
For the year ended December 31, 2005 | $ | 9.98 | $ | 0.21 | $ | 0.05 | $ | 0.26 | $ | (0.21 | ) | $ | – | $ | (0.21 | ) | $ | 10.03 | 2.62% | |||||||||||||||||
For the year ended December 31, 2006 | $ | 10.03 | $ | 0.24 | $ | 0.98 | $ | 1.22 | $ | (0.25 | ) | $ | – | $ | (0.25 | ) | $ | 11.00 | 12.30% | |||||||||||||||||
For the six months ended June 30, 2007 (Unaudited) | $ | 11.00 | $ | 0.14 | $ | 0.40 | $ | 0.54 | $ | (0.14 | ) | $ | (0.31 | ) | $ | (0.45 | ) | $ | 11.09 | 4.98% |
[Additional columns below]
[Continued from above table, first column(s) repeated]
Ratios / Supplemental Data | ||||||||||||||||||||||||||
Ratio of | Ratio of Net | |||||||||||||||||||||||||
Net | Ratio of | Investment | ||||||||||||||||||||||||
Investment | Expenses | Income | ||||||||||||||||||||||||
Net Assets | Ratio of | Income | (Prior to | (Prior to | ||||||||||||||||||||||
at End of | Expenses | to Average | Reimbursements) | Reimbursements) | ||||||||||||||||||||||
Period | to Average | Net | to Average Net | to Average Net | Portfolio | |||||||||||||||||||||
(000s) | Net Assets (b) | Assets (b) | Assets (b) (c) | Assets (b) (c) | Turnover (d) | |||||||||||||||||||||
Class I Shares | ||||||||||||||||||||||||||
For the year ended December 31, 2002 | $ | 147,289 | 0.99% | 2.22% | 1.00% | 2.21% | 297.08% | |||||||||||||||||||
For the year ended December 31, 2003 | $ | 182,056 | 0.98% | 1.80% | (f) | (f) | 310.16% | |||||||||||||||||||
For the year ended December 31, 2004 | $ | 189,232 | 0.98% | 1.96% | (f) | (f) | 293.17% | |||||||||||||||||||
For the year ended December 31, 2005 | $ | 178,569 | 0.99% | 1.97% | (f) | (f) | 328.26% | |||||||||||||||||||
For the year ended December 31, 2006 | $ | 154,931 | 1.01% | 2.22% | (f) | (f) | 312.59% | |||||||||||||||||||
For the six months ended June 30, 2007 (Unaudited) | $ | 144,903 | 1.01% | 2.39% | 1.01% | 2.39% | 116.41% | |||||||||||||||||||
Class IV Shares | ||||||||||||||||||||||||||
For the year ended December 31, 2003 (e) | $ | 50,811 | 0.91% | 1.79% | 0.96% | 1.74% | 310.16% | |||||||||||||||||||
For the year ended December 31, 2004 | $ | 51,061 | 0.91% | 2.02% | 0.98% | 1.95% | 293.17% | |||||||||||||||||||
For the year ended December 31, 2005 | $ | 47,803 | 0.91% | 2.05% | 0.99% | 1.96% | 328.26% | |||||||||||||||||||
For the year ended December 31, 2006 | $ | 47,807 | 0.97% | 2.26% | 1.01% | 2.22% | 312.59% | |||||||||||||||||||
For the six months ended June 30, 2007 (Unaudited) | $ | 47,610 | 1.00% | 2.40% | 1.00% | 2.40% | 116.41% |
(a) | Not annualized for periods less than one year. |
(b) | Annualized for periods less than one year. |
(c) | During the period, certain fees were waived and/or reimbursed. If such waivers/reimbursements had not occurred, the ratios would have been as indicated. |
(d) | Portfolio turnover is calculated on the basis of the Fund as a whole without distinguishing among the classes of shares. |
(e) | For the period from April 28, 2003 (commencement of operations) through December 31, 2003. |
(f) | There were no fee waivers/reimbursements during the period. |
[Additional columns below]
[Continued from above table, first column(s) repeated]
1. Organization
Nationwide Variable Insurance Trust (“NVIT” or the “Trust”) is an open-end management investment company, organized under the laws of Delaware by an amended and restated Agreement and Declaration of Trust, dated October 28, 2004, as amended to date. Prior to May 1, 2007, the Trust was named “Gartmore Variable Insurance Trust”. The Trust, originally created under the laws of Massachusetts as a Massachusetts business trust pursuant to a Declaration of Trust dated, as of June 30, 1981, and as subsequently amended, redomesticated as a Delaware Statutory Trust after the close of trading on April 29, 2005, and is registered under the Investment Company Act of 1940, as amended (the “1940 Act”). The redomestication was a change in statutory status and did not affect the operations of the Trust. As of June 30, 2007, the Trust had authorized an unlimited number of shares of beneficial interest, without par value (“shares”). The Trust currently offers shares to life insurance company separate accounts to fund the benefits under variable life insurance or annuity policies. To date, only the separate accounts of Nationwide Life Insurance Company and Nationwide Life and Annuity Insurance Company (collectively, “Nationwide”) have purchased shares of the J.P. Morgan NVIT Balanced Fund (the “Fund”), (formerly, “J.P. Morgan GVIT Balanced Fund”). The Trust currently operates forty (40) separate series, or mutual funds, each with its own investment objectives and strategies. This report contains the financial statements and financial highlights of the Fund.
2. Summary of Significant Accounting Policies
The following is a summary of significant accounting policies followed by the Fund in the preparation of its financial statements. The policies are in conformity with accounting principles generally accepted in the United States of America (“GAAP”). The preparation of financial statements requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of income and expenses for the period. Actual results could differ from those estimates.
(a) | Security Valuation |
Securities for which market quotations are readily available are valued at current market value as of “Valuation Time.” Valuation Time is as of the close of regular trading on the New York Stock Exchange (usually 4 p.m. Eastern time). Equity securities are valued at the last quoted sale price or, if there is no sale price, the last quoted bid price provided by an independent pricing service approved by the Trust’s Board of Trustees (“Board of Trustees”). Securities traded on NASDAQ are valued at the NASDAQ official closing price. Prices are taken from the primary market or exchange in which each security trades. Investment companies are valued at net asset value by such company. | |
Most securities listed on a foreign exchange are valued either at fair value (see description below) or at the last sale price at the close of the exchange on which the security is principally traded. Foreign securities, currencies, and other assets and liabilities denominated in foreign currencies are translated into U.S. dollars at the exchange rate of said currencies against the U.S. dollar, as of Valuation Time, as provided by an independent pricing service approved by the Board of Trustees. | |
Debt (including defaulted issues) and other fixed income securities (other than short-term obligations) are valued at the last quoted bid price and/or by using a combination of daily quotes and matrix evaluations provided by an independent pricing service, the use of which has been approved by the Board of Trustees. Short-term debt securities, such as commercial paper and U.S. Treasury Bills having a remaining maturity of 60 days or less at the time of purchase, are considered to be “short-term” and are valued at amortized cost, which approximates market value. | |
Securities for which market quotations are not readily available, or for which an independent pricing service does not provide a value or provides a value that does not represent fair value in the judgment of the Fund’s investment adviser or designee, are valued at fair value under procedures approved by the Board of Trustees. The “Fair Value” of these securities is determined in good faith by taking into account relevant factors and surrounding circumstances. Methods utilized to obtain a “Fair Value” may include the following non-exclusive list of acceptable methods: (i) a |
multiple of earnings; (ii) the discount from market value of a similar, freely traded security; (iii) the yield-to-maturity for debt issues; or (iv) a consolidation of the methods. The Trust’s Valuation & Operations Committee considers a non-exclusive list of factors to arrive at the appropriate method of determining “Fair Value.” For example, fair value determinations are required for securities whose value is affected by a “significant” event that materially affects the value of a domestic or foreign security which occurs subsequent to the time of the close of the principal market on which such domestic or foreign security trades and before the Valuation Time (i.e., a “subsequent event”). Typically, this will involve events occurring after the close of a foreign market on which a security trades and before the next Valuation Time. | |
The Fund values foreign securities at fair value in the circumstances described below. Generally, trading in foreign securities markets is completed each day at various times prior to the Valuation Time. Due to the time differences between the closings of the relevant foreign securities exchanges and the Valuation Time for the Fund, the Fund will fair value its foreign investments when it is determined that the market quotations for the foreign investments either are not readily available or are unreliable and, therefore, do not represent fair value. When the fair value prices are utilized, these prices will attempt to reflect the impact of the U.S. financial markets’ perceptions and trading activities on the Fund’s foreign investments since the last closing prices of the foreign investments were calculated on their primary foreign securities markets or exchanges. For these purposes, the Board of Trustees has determined that movements in relevant indices or other appropriate market indicators, after the close of the foreign securities exchanges, may demonstrate that market quotations are unreliable, and may trigger fair value pricing for certain securities. Consequently, fair valuation of portfolio securities may occur on a daily basis. |
(b) | Repurchase Agreements |
The Fund may enter into repurchase agreements with an entity which is a member of the Federal Reserve System or which is a “primary dealer” (as designated by the Federal Reserve Bank of New York) in U.S. Government obligations. The repurchase price generally equals the price paid by the Fund plus interest negotiated on the basis of current short-term rates, which may be more or less than the rate on the underlying portfolio securities. The seller under a repurchase agreement is required to maintain the value of the collateral held pursuant to the agreement at a market value equal to or greater than the repurchase price (including accrued interest). Collateral subject to repurchase agreements is held by the Fund’s custodian or another qualified sub-custodian or in the Federal Reserve/ Treasury book-entry system. If the counterparty defaults and the fair value of the collateral declines, realization of the collateral by the Fund may be delayed or limited. The Fund may transfer uninvested cash balances into a pooled cash account. These balances are invested in one or more repurchase agreements, with the counterparty of Nomura Securities, which is fully collateralized by U.S. Government Agency Mortgages. |
(c) | Futures Contracts |
The Fund may invest in financial futures contracts (“futures contracts”) for the purpose of hedging its existing portfolio securities or securities that the Fund intends to purchase against fluctuations in value caused by changes in prevailing market interest rates or prices. Futures contracts may also be entered into for non-hedging purposes. | |
Upon entering into a futures contract, the Fund is required to pledge to the broker an amount of cash and/or other assets equal to a certain percentage of the contract amount (initial margin deposit). Subsequent payments, known as “variation margin,” are made each day, depending on the daily fluctuations in the fair value/market value of the underlying assets. A gain or loss equal to the daily variation margin is recognized on a daily basis. Futures contracts are valued daily at their last quoted sale price. | |
A “sale” of a futures contract means the creation of a contractual obligation to deliver the securities or foreign currency called for by the contract at a fixed price at a specified time in the future. A “purchase” of a futures contract means the creation of a contractual obligation to acquire the securities or foreign currency at a fixed price at a specified time in the future. |
Should market conditions change unexpectedly, the Fund may not achieve the anticipated benefits of the futures contracts and may realize a loss. The use of futures transactions for hedging purposes involves the risk of imperfect correlation in movements in the price of futures contracts, interest rates, and the value of the underlying hedged assets. |
(d) | Foreign Currency Transactions |
The accounting records of the Fund are maintained in U.S. dollars. Foreign currency amounts are translated into U.S. dollars at the current rate of exchange to determine the value of investments, assets and liabilities. The Fund may enter into foreign currency contracts in connection with purchases or sales of securities denominated in a foreign currency. Purchases and sales of securities, and income and expenses, are translated at the prevailing rate of exchange on the respective date of these transactions. The Fund does not isolate that portion of the results of operations resulting from changes in foreign exchange rates on investments from fluctuations arising from changes in market prices of securities held. These fluctuations are included with the net realized and unrealized gain or loss from investments and foreign currencies. |
(e) | Written Options Contracts |
The Fund may write options contracts. A written option obligates the Fund to deliver (written call) or to receive (written put) a specified quantity of an underlying asset at the contract amount upon exercise by the holder of the option. When the Fund writes an option, an amount equal to the premium received by the Fund is recorded as a liability and is subsequently adjusted to the current fair value of the option written. Premiums received from writing options that expire unexercised are treated by the Fund on the expiration date as realized gains from investments. The difference between the premium and the amount paid on effecting a closing purchase transaction, as a realized loss. If a call option is exercised, the premium is added to the proceeds from the sale of the underlying security or currency in determining whether the Fund has realized a gain or loss. If a put option is exercised, the premium reduces the cost basis of the securities purchased by the Fund. Options traded on an exchange are valued at the last quoted sale price, or in the absence of a sale, the bid price provided by an independent pricing service approved by the Board of Trustees. Non-exchange traded options are valued using dealer supplied quotes. The Fund as a writer of an option bears the market risk of an unfavorable change in the price of the security underlying the written option. |
(f) | Mortgage Dollar Rolls |
The Fund may enter into mortgage “dollar rolls” in which the Fund sells mortgage-backed securities for delivery in the current month and simultaneously contracts to repurchase substantially similar (same type, coupon, and maturity) securities on a specified future date. Mortgage dollar rolls may be implemented in the “to be announced” (“TBA”) market and are referred to as TBAs on the Statement of Investments of the Fund. During the roll period, the Fund foregoes principal and interest paid on the mortgage-backed securities. Each mortgage dollar roll is treated as a financing transaction; therefore, any gain or loss is considered unrealized until the roll reaches completion. Risks may arise due to the delayed payment date and the potential inability of counterparties to complete the transaction. Income is generated as consideration for entering into these transactions and is included in interest income on the Statement of Operations. |
(g) | Security Transactions and Investment Income |
Security transactions are accounted for on the date the security is purchased or sold (“trade date”). Securities gains and losses are calculated on the identified cost basis. Interest income is recognized on the accrual basis and includes, where applicable, the amortization or accretion of premium or discount. Dividend income is recorded on the ex-dividend date. |
(h) | Distributions to Shareholders |
The Fund’s dividends from net investment income, if any, are declared and paid quarterly. The Fund’s distributions from net realized capital gains, if any, are declared and distributed at least annually. | |
Dividends and distributions to shareholders are determined in accordance with federal income tax regulations, which may differ from GAAP. These “book/tax” differences are considered either permanent or temporary in nature. In accordance with the American Institute of Certified Public Accountants Statement of Position 93-2, permanent differences (i.e., reclassification of market discounts, foreign exchange gain/loss, paydowns, and distributions from real estate investment trusts) are reclassified within the capital accounts based on their nature for federal income tax purposes; temporary differences do not require reclassification. These reclassifications have no effect upon the net asset value of the Fund. To the extent distributions exceed current and accumulated earnings and profits for federal income tax purposes, these distributions are reported as distributions of paid-in-capital. |
(i) | Federal Income Taxes |
It is the policy of the Fund to qualify or to continue to qualify as a “regulated investment company” by complying with the provisions available to certain investment companies, as defined in Subchapter M of the U.S. Internal Revenue Code, and to make distributions of net investment income and net realized capital gains sufficient to relieve the Fund from all, or substantially all, federal income taxes. | |
As of June 30, 2007, the tax cost of securities and the breakdown of unrealized appreciation (depreciation) for the Fund was as follows: |
Net Unrealized | ||||||||||||||||
Tax Cost of | Unrealized | Unrealized | Appreciation | |||||||||||||
Securities | Appreciation | Depreciation | (Depreciation) | |||||||||||||
$ | 192,757,111 | $ | 20,011,018 | $ | (2,577,470 | ) | $ | 17,433,547 | ||||||||
(j) | Allocation of Expenses, Income, and Gains and Losses |
Expenses directly attributable to the Fund are charged to the Fund. Expenses not directly attributable to the Fund are allocated proportionately among various or all funds within the Trust. The method used by the Fund for allocating income, fund level expenses, and realized and unrealized gains or losses is based on the fair value of shares outstanding relative to net assets. Under this method, each class of shares participates based on the total net asset value of that class’s shares in proportion to the total net assets of the Fund. Expenses specific to a class (such as Rule 12b-1 and administrative services fees) are charged to that class. |
3. Transactions with Affiliates
Under the terms of the Trust’s Investment Advisory Agreement, Nationwide Fund Advisors (formerly, Gartmore Mutual Fund Capital Trust (“GMF”)) (“NFA” or the “Advisor”) manages the investment of the assets and supervises the daily business affairs of the Fund. NFA is a wholly-owned subsidiary of Nationwide Financial Services (“NFS”). In addition, NFA provides investment management evaluation services in initially selecting and monitoring, on an ongoing basis, the performance of the subadviser for the Fund. JPMorgan Investment Management, Inc. (the “subadviser”) manages all of the Fund’s investments and has the responsibility for making all investment decisions for the Fund.
Under the terms of the Investment Advisory Agreement, the Fund pays NFA an investment advisory fee based on that Fund’s average daily net assets. Additional information regarding investment advisory fees and subadvisory fees for NFA and the subadviser is as follows for the six months ended June 30, 2007:
Total | ||||||
Fee Schedule | Fees | |||||
Up to $100 million | 0.75% | |||||
$100 million or more | 0.70% | |||||
From such fees, pursuant to the subadvisory agreement, NFA paid the subadviser $321,757 for the six months ended June 30, 2007.
As of the six months ended June 30, 2007, the cumulative potential reimbursements for the Class IV shares of the Fund, based on reimbursements which expire within three years from the fiscal year in which the corresponding reimbursement to the Fund was made for expenses reimbursed by NFA would be:
Amount | Amount | Amount | ||||||||||
Fiscal Year | Fiscal Year | Fiscal Year | ||||||||||
2004 | 2005 | 2006 | ||||||||||
$ | 32,438 | $ | 41,390 | $ | 16,988 | |||||||
Under the terms of a Fund Administration and Transfer Agency Agreement, Nationwide Fund Management, LLC (formerly, Gartmore Investor Services, Inc. (“GISI”)) (“NFM”), a wholly-owned subsidiary of NFS Distributors, Inc. (“NFSDI”), provides the Fund with various administrative and accounting services for the Fund (prior to May 1, 2007, this service was provided by Gartmore SA Capital Trust (“GSA”)), and serves as Transfer and Dividend Disbursing Agent for the Fund (prior to May 1, 2007, this service was provided by GISI, an indirect subsidiary of GSA.) The fees for the services provided under this Agreement are calculated based on the Trust’s average daily net assets according to the fee schedule below. The fees are then allocated proportionately among all funds within the Trust in relation to the average daily net assets of each fund and are paid to NFA. NFA pays NFM from these fees for NFM’s services.
Combined Fee Schedule* | ||||||
Up to $1 billion | 0.15% | |||||
$1 billion up to $3 billion | 0.10% | |||||
$3 billion up to $8 billion | 0.05% | |||||
$8 billion up to $10 billion | 0.04% | |||||
$10 billion up to $12 billion | 0.02% | |||||
$12 billion or more | 0.01% | |||||
* | The assets of the Nationwide NVIT Investor Destinations Aggressive Fund, the Nationwide NVIT Investor Destinations Moderately Aggressive Fund, the Nationwide NVIT Investor Destinations Moderate Fund, the Nationwide NVIT Investor Destinations Moderately Conservative Fund, and the Nationwide NVIT Investor Destinations Conservative Fund (collectively, the “Investor Destinations Funds”) are excluded from the Trust asset level amount in order to calculate this asset-based fee. The Investor Destinations Funds do not pay any part of this fee. |
NFA and NFM have entered into agreements with Citi Fund Services Ohio, Inc. (“Citi”), pursuant to which Citi provides sub-administration and sub-transfer agency services, respectively, to the Fund. Effective August 1, 2007, the BISYS Group Inc. was acquired by and became a wholly owned subsidiary of Citi.
Under the terms of an Administrative Services Plan, the Fund may pay fees to servicing organizations, such as broker-dealers, including NFS, and financial institutions, which agree to provide administrative support services to the shareholders of certain classes. These services include, but are not limited, to the following: establishing and maintaining shareholder accounts; processing purchase and redemption transactions; arranging bank wires; performing shareholder
For the six months ended June 30, 2007, NFS received $148,423 in Administrative Services Fees from the Fund.
Under the terms of a letter agreement dated September 12, 2006, by and among NFA, the Audit Committee of the Trust and the Trust, the Trust has agreed to reimburse NFA certain costs related to the Fund’s portion of ongoing administration, monitoring and annual (audit) testing of the Trust’s Rule 38a-1 Compliance Program subject to the pre-approval of the Trust’s Audit Committee. For the six months ended June 30, 2007, the Fund’s portion of such costs amounted to $1,400.
4. Investment Transactions
For the six months ended June 30, 2007, (excluding short-term securities) the Fund had purchases of $229,313,664 and sales of $248,047,186.
For the six months ended June 30, 2007, the Fund had purchases of $184,462,622 and sales of $186,177,654 of U.S. Government securities.
5. Bank Loans and Earnings Credit
The Trust has a credit agreement with JPMorgan Chase & Co., the Fund’s custodian bank, permitting the Trust to borrow up to $100,000,000. Borrowings under this arrangement bear interest at the Federal Funds rate plus 0.50%. The interest costs, if any, would be included in other fees in the Statement of Operations. No compensating balances were required under the terms of the line of credit. The line of credit is renewed annually, expiring on June 25, 2008, with a commitment fee of 0.07% per year on $100,000,000. There were no borrowings outstanding under this line of credit for the six months ended June 30, 2007.
The Trust’s custodian bank has agreed to reduce the bank’s fees (earnings credit) when the funds of the Trust maintain cash on deposit in non-interest-bearing custody and Demand Deposit Accounts. Earnings credits are shown as a reduction of total expenses on the Statement of Operations.
6. Portfolio Investment Risks
Risks Associated with Foreign Securities and Currencies. Investments in securities of foreign issuers carry certain risks not ordinarily associated with investments in securities of U.S. issuers. These risks include future political and economic developments, and the possible imposition of exchange controls or other foreign governmental laws and restrictions. In addition, with respect to certain countries, there is the possibility of expropriation of assets, confiscatory taxation, political or social instability, or diplomatic developments, which could adversely affect investments in those countries.
Certain countries also may impose substantial restrictions on investments in their capital markets by foreign entities, including restrictions on investments in issuers of industries deemed sensitive to relevant national interests. These factors may limit the investment opportunities available and result in a lack of liquidity and high price volatility with respect to securities of issuers from developing countries.
Credit and Market Risk. The Fund invests in emerging market instruments that are subject to certain additional credit and market risks. The yields of emerging market debt obligations reflect, among other things, perceived credit risk. The Fund’s investment in securities rated below investment grade typically involve risks not associated with higher rated securities including, among others, greater risk of not receiving timely and/or ultimate payment of interest and principal, greater market price volatility, and less liquid secondary market trading. The consequences of political, social, economic, or diplomatic changes may have disruptive effects on the market prices of emerging markets investments held by the Fund.
7. Indemnifications
Under the Trust’s organizational documents, certain of the Trust’s Officers and Trustees are indemnified against certain liabilities arising out of the performance of their duties to the Trust. In addition, the Trust has entered into Indemnification Agreements with the Trust’s trustees and certain officers covering similar liabilities. Trust Officers receive no compensation from the Trust for serving as the Trust’s Officers. In addition, in the normal course of business, the Trust enters into contracts with its vendors and others that provide for general indemnifications. The Trust’s maximum exposure under these arrangements is unknown, as this would involve future claims that may be made against the Trust. Based on experience, however, the Trust expects that risk of loss to be remote.
8. Recently Issued Accounting Pronouncements
On July 13, 2006, the Financial Accounting Standards Board (“FASB”) released FASB Interpretation No. 48, Accounting for Uncertainty in Income Taxes (“FIN 48”). FIN 48 provides guidance for how uncertain tax positions should be recognized, measured, presented and disclosed in the financial statements. FIN 48 requires the affirmative evaluation of tax positions taken or expected to be taken in the course of preparing the Fund’s tax returns to determine whether it is more-likely-than-not (i.e., greater than 50 percent) that each tax position will be sustained upon examination by a taxing authority based on the technical merits of the position. A tax position that meets the more-likely-than-not recognition threshold is measured to determine the amount of benefit to recognize in the financial statements. Differences between tax positions taken in a tax return and amounts recognized in the financial statements will generally result in an increase in a liability for taxes payable (or a reduction of a tax refund receivable) and an increase in a deferred tax liability (or a reduction in a deferred tax asset). Adoption of FIN 48 was required no later than the last business day of the first financial statement reporting period for fiscal years beginning after December 15, 2006 and is to be applied to all open tax years as of the effective date. Accordingly, the Fund was required to implement FIN 48 in its net asset value per share (NAV) calculation on June 29, 2007. Management has evaluated the implications of FIN 48 and has concluded that there was no impact to the Fund’s financial statements as of June 29, 2007. The adoption of FIN 48 requires ongoing monitoring and analysis, future conclusions reached by management may be different and result in adjustments to the Fund’s NAV and financial statements.
In September 2006, the FASB issued Statement on Financial Accounting Standards (“SFAS”) No. 157, “Fair Value Measurements.” This standard establishes a single authoritative definition of fair value, sets out a framework for measuring fair value and requires additional disclosures about fair value measurements. SFAS No. 157 applies to fair value measurements already required or permitted by existing standards. SFAS No. 157 is effective for financial statements issued for fiscal years beginning after November 15, 2007 and interim periods within those fiscal years. The changes to current accounting principles generally accepted in the United States of America from the application of this Statement relate to the definition of fair value, the methods used to measure fair value, and the expanded disclosures about fair value measurements. As of June 30, 2007, the Fund does not believe the adoption of SFAS No. 157 will impact the financial statement amounts; however, additional disclosures may be required about the inputs used to develop the measurements and the effect of certain of the measurements on changes in net assets for the period.
Trustees who are not Interested Persons (as defined in the 1940 Act) and Officers of the Trust as of
Number of Portfolios | ||||||||||
Position(s) Held | in the | |||||||||
with the Trust | Principal Occupation(s) | Nationwide Fund | Other | |||||||
Name, Address | and Length of | During Past | Complex Overseen | Directorships | ||||||
and Year of Birth | Time Served1 | Five Years | by Trustee | Held by Trustee2 | ||||||
Charles E. Allen c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1948 | Trustee since July 2000 | Mr. Allen is Chairman, Chief Executive Officer and President of Graimark Realty Advisors, Inc. (real estate development, investment and asset management). | 89 | None | ||||||
Paula H.J. Cholmondeley c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1947 | Trustee since July 2000 | Ms. Cholmondeley was Vice President and General Manager of Sappi Fine Paper North America from April 2000 through December 2003. | 89 | Director of Dentsply International, Inc. (dental products), Ultralife Batteries, Inc., Terex Corporation (construction equipment), Minerals Technology, Inc. (specialty chemicals) and Albany International Corp. (paper industry) | ||||||
C. Brent DeVore3 c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1940 | Trustee since 1990 | Dr. DeVore is President of Otterbein College. | 89 | None | ||||||
Phyllis Kay Dryden c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1947 | Trustee since December 2004 | Ms. Dryden was a partner of Mitchell Madison, a management consulting company from January 2006 until December 2006; she is currently a consultant with the company. Ms. Dryden was formerly Managing Partner of march FIRST, a global management consulting firm. | 89 | None | ||||||
Barbara L. Hennigar c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1935 | Trustee since July 2000 | Retired. | 89 | None | ||||||
Number of Portfolios | ||||||||||
Position(s) Held | in the | |||||||||
with the Trust | Principal Occupation(s) | Nationwide Fund | Other | |||||||
Name, Address | and Length of | During Past | Complex Overseen | Directorships | ||||||
and Year of Birth | Time Served1 | Five Years | by Trustee | Held by Trustee2 | ||||||
Barbara I. Jacobs c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1950 | Trustee since December 2004 | Ms. Jacobs served as Chairman of the Board of Directors of KICAP Network Fund, a European (United Kingdom) hedge fund, from January 2001 through January 2006. From 1998-2003, Ms. Jacobs was also a Managing Director and European Portfolio Manager of CREF Investments (Teachers Insurance and Annuity Association-College Retirement Equities Fund). | 89 | None | ||||||
Douglas F. Kridler c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1955 | Trustee since September 1997 | Mr. Kridler has served as the President and Chief Executive Officer of the Columbus Foundation (a Columbus, OH-based foundation which manages over 1,300 individual endowment funds) since February 2002. Prior to January 31, 2002, Mr. Kridler was the President of the Columbus Association for the Performing Arts and Chairman of the Greater Columbus Convention and Visitors Bureau. | 89 | None | ||||||
Michael D. McCarthy c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1947 | Trustee since December 2004 | Retired. Mr. McCarthy was Chairman of VMAC (commodity swaps) from October 2002 until January 2007; and a partner of Pineville Properties LLC (a commercial real estate development firm) from September 2000 until January 2007. | 89 | None | ||||||
David C. Wetmore c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1948 | Trustee since 1995 and Chairman since February 2005 | Retired. | 89 | None | ||||||
1 | Length of time served includes time served with the Trust’s predecessors. | |
2 | Directorships held in (1) any other investment companies registered under the 1940 Act, (2) any company with a class of securities registered pursuant to Section 12 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or (3) any company subject to the requirements of Section 15(d) of the Exchange Act. | |
3 | Mr. DeVore has served as President of Otterbein College since 1984. Mark Thresher, President and Chief Operating Officer of Nationwide Financial Services, Inc. (“NFS”) has served as a member of the Board of Trustees of Otterbein College since 2000, currently serves as one of 30 of its trustees, and is currently one of two Vice Chairmen of the Board. Each of Nationwide Fund Advisors (“NFA”), the Funds’ investment adviser, and Nationwide Fund Distributors LLC (“NFD”), principal underwriter to the Trust, is a wholly-owned subsidiary of NFS. | |
Additional information regarding the Trustees and Officers may be found in the Trust’s Statement of Additional Information, which is available without charge upon request, by calling 800-848-0920. |
Trustees who are Interested Persons (as defined in the 1940 Act) and/or Officers of the Trust as of
Number of Portfolios | ||||||||||
Position(s) Held | in the | |||||||||
with the Trust | Principal Occupation(s) | Nationwide Fund | Other | |||||||
Name, Address | and Length of | During Past | Complex Overseen | Directorships | ||||||
and Year of Birth | Time Served1 | 5 Years | by Trustee | Held by Trustee 2 | ||||||
Arden L. Shisler c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1941 | Trustee since February 2000 | Retired. Mr. Shisler is the former President and Chief Executive Officer of KeB Transport, Inc., a trucking firm (2000 through 2002). He served as a consultant to KeB from January 2003 through December 2004. Since 1992, Mr. Shisler has also been Chairman of the Board for Nationwide Mutual Insurance Company.3 | 89 | Director of Nationwide Financial Services, Inc., Chairman of Nationwide Mutual Insurance Company3 | ||||||
John H. Grady Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1961 | President & Chief Executive Officer since December 2006 | Mr. Grady is President, and Chief Executive Officer of Nationwide Funds Group which includes Nationwide Fund Advisors,3 Nationwide Fund Management LLC,3 Nationwide Fund Distributors LLC 3 and NWD Investments,2 the asset management operations of Nationwide Mutual Insurance Company, which includes Morley Capital Management, Inc.,2 Nationwide Separate Accounts LLC,2 NorthPointe Capital LLC,2 and Nationwide SA Capital Trust2. From March 2004 until March 2006, Mr. Grady was Chief Executive Officer of Constellation Investment Management Co., L.P. (registered investment adviser), and President and Chief Executive Officer of Constellation Funds Group (registered investment companies). He also was President of Constellation Investment Distribution Co., Inc. (registered broker-dealer) from March 2004 until June 2006. From February 2001 until February 2004, Mr. Grady was Chief Operating and Chief Legal Officer; Managing Director, Mutual Funds Group, Turner Investment Partners, Inc. (registered investment adviser); Executive Vice President of Turner Funds and Turner Institutional Portfolios (registered investment companies); and President, Turner Investment Distributors, Inc. (registered broker-dealer). | N/A | None | ||||||
Gerald J. Holland Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1951 | Treasurer since March 2001 | Mr. Holland is Senior Vice President—Operations for Nationwide Funds Group3. | N/A | N/A | ||||||
Number of Portfolios | ||||||||||
Position(s) Held | in the | |||||||||
with the Trust | Principal Occupation(s) | Nationwide Fund | Other | |||||||
Name, Address | and Length of | During Past | Complex Overseen | Directorships | ||||||
and Year of Birth | Time Served1 | 5 Years | by Trustee | Held by Trustee 2 | ||||||
Michael A. Krulikowski Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1959 | Chief Compliance Officer from June 2004 to August 20074 | Mr. Krulikowski is Vice President and Chief Compliance Officer of Nationwide Funds Group3, Morley Capital Management, Inc.3, Nationwide SA Capital Trust (since 1999)3, and Nationwide Separate Accounts LLC (since August 2005).3 Since June 2004, Mr. Krulikowski has also served as Chief Compliance Officer of the Trust. From November 1999 through May 2007, he served as Vice President and Chief Compliance Officer of NorthPointe Capital LLC. 3 | N/A | N/A | ||||||
Eric E. Miller Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1953 | Secretary since December 2002 | Mr. Miller is Senior Vice President, General Counsel, and Assistant Secretary for Nationwide Funds Group3 and NWD Investments.2 From August 2000 to August 2002, Mr. Miller was a Partner with Stradley Ronon Stevens & Young, LLP. | N/A | N/A | ||||||
1 | Length of time served includes time served with the Trust’s predecessors. | |
2 | Directorships held in (1) any other investment companies registered under the 1940 Act, (2) any company with a class of securities registered pursuant to Section 12 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or (3) any company subject to the requirements of Section 15(d) of the Exchange Act. | |
3 | This position is held with an affiliated person or principal underwriter of the Trust. | |
4 | Effective August 3, 2007, the Board of Trustees approved Carol Baldwin Moody as Chief Compliance Officer of the Trust. Since November 2005, Ms. Moody has been Senior Vice President, Chief Compliance Officer of Nationwide Financial Services, Nationwide Life Insurance Company, Nationwide Life and Annuity Insurance Company, and Nationwide Investment Advisors, LLC. From February 2004-November 2005, she was Chief Compliance Officer of TIAA-CREF and from April 2000-February 2004, she was Managing Director and General Counsel, TCW/ Latin America Partners, LLC and Baeza & Co., LLC. | |
Federal law requires the Trust, each of its investment advisers and sub-advisers to adopt procedures for voting proxies (“Proxy Voting Guidelines”) and to provide a summary of those Proxy Voting Guidelines used to vote the securities held by the Funds. The Funds’ proxy voting policies and procedures are available without charge (i) upon request, by calling 800-848-0920, (ii) on the Funds’ website at www.nationwidefunds.com, or (iii) on the Securities and Exchange Commission’s website at www.sec.gov. |
A. Renewal of Investment Advisory Agreement
(i) | General Information Regarding the Board’s Review of Investment Advisory Agreements |
The Trust’s investment advisory agreements (each an “Advisory Agreement”) with its investment adviser and, as applicable, sub-advisers (together, the “Adviser”) must be approved for an initial term no greater than two years, and renewed at least annually thereafter, (i) by the vote of the Trustees or by a vote of the shareholders of each series or fund of the Trust (individually a “Fund”), and (ii) by the vote of a majority of the Trustees who are not parties to the Advisory Agreement or “interested persons” of any party thereto (the “Independent Trustees”) cast in person at a meeting called for the purpose of voting on such approval.
The Board meets quarterly and takes into account throughout the year matters bearing on each Fund’s Advisory Agreement. The Board and its standing committees consider at each meeting factors that are relevant to the annual renewal of an Advisory Agreement, including the services and support provided to a Fund and its shareholders.
On December 6, 2006, the Independent Trustees first met in person with their independent legal counsel (“Independent Legal Counsel”) to consider information provided by the Adviser and others to assist the Trustees in considering whether to renew each Fund’s Advisory Agreement for a one year term beginning May 1, 2007. Immediately following such meeting of the Independent Trustees, all Trustees met in person with the Adviser, Trust counsel, Independent Legal Counsel and others to consider such matters, and give preliminary consideration to information bearing on continuation of each Advisory Agreement. The primary purpose of the December 6 and 7, 2006 meeting was to ensure that the Trustees had ample opportunity to consider matters they deemed relevant in considering the continuation of an Advisory Agreement, and to request any additional information they considered reasonably necessary to their deliberations.
In preparation for the December 6 and 7, 2006 meeting the Trustees were provided, at the request of the Trustees, with a wide range of information to assist in their deliberations, including (i) reports from Lipper Inc. describing a Fund’s (a) performance rankings (where “first quintile” denotes the best performance) (over multiple years ended September 30, 2006) compared with performance groups and performance universes created by Lipper (and in some cases, customized peer groups created by the Adviser) of similar or peer group funds, and (b) expense rankings (where “first quintile” denotes the lowest fees and expenses) comparing the Fund’s contractual advisory fee and total expenses with expense groups and expense universes created by Lipper of similar or peer group funds, (ii) information from the Adviser describing the Fund’s performance (over multiple years ended September 30, 2006) compared with its benchmark and Lipper categories, (iii) for Funds under “close review,” copies of letters from the Adviser to the portfolio manager of each such Fund, together with the portfolio manager’s written response describing the reasons for the Fund’s underperformance (iv) information from the Adviser describing performance for the months of October and November, 2006, and annual performance for the year ended November 30, 2006, (v) reports from the Adviser describing the Adviser’s profitability in providing services under an Advisory Agreement, together with an explanation of Adviser’s methodology in calculating its profitability, (vi) information from the Adviser describing any fees paid to the Adviser for managing similar, non-affiliated institutional accounts, including the range of fee levels for such accounts, and (vii) information from the Adviser describing ancillary benefits, in addition to fees for serving as investment adviser, derived by the Adviser as a result of being investment adviser for a Fund, including, where applicable, information on soft-dollar benefits and fees inuring to the Adviser’s affiliates for serving as the Trust’s administrator, fund accountant and transfer agent.
At the December 6 and 7, 2006 meeting, the Trustees reviewed, considered and discussed, among themselves and with the Adviser, Trust counsel and Independent Legal Counsel, among other things, the information described above, and: (i) the nature, extent and quality of services provided by the Adviser under each Advisory Agreement, (ii) the investment performance of each Fund and the Adviser, (iii) the costs of the services provided by the Adviser under the Advisory Agreement and the profits realized by the Adviser thereunder, (iv) the extent to which economies of scale may be present and, if so, whether they are being shared with a Fund’s shareholders, (v) comparisons of the Adviser’s fees under the Advisory Agreement with investment advisory fees paid by peer group funds to their investment advisers and paid by non-affiliated institutional clients to the Adviser for managing similar accounts, and (vi) any ancillary benefits inuring to the Adviser and its affiliates as a result of being investment adviser for the Trust. The Trustees also considered, where
As part of the December 6 and 7, 2006 Board meeting, the Independent Trustees developed a list of follow-up matters and questions and asked that Adviser respond to such matters and questions at the contract approval meeting of the Board of Trustees to be held on January 11, 2007.
At the January 11, 2007 meeting of the Board of Trustees of the Trust, the Board received and considered information provided by the Adviser in follow-up from the December 6 and 7, 2006 Board meeting and, after consulting among themselves, and with the Adviser, Trust counsel and Independent Legal Counsel, concluded unanimously to renew the Advisory Agreement for the reasons set forth in the following section. In determining whether to renew the Advisory Agreement for the Fund, the Board ultimately reached a determination, with the assistance of Trust counsel and Independent Legal Counsel, that the renewal of the Advisory Agreement and the compensation to be received by the Adviser under the Advisory Agreement is consistent with the Board’s fiduciary duty under applicable law.
(ii) | Board Conclusions Regarding the Fund’s Advisory Agreement |
The Board considered that the Fund had underperformed its benchmark, the S&P 500 Index (60%) and the Lehman Brothers Aggressive Bond Index (40%), for the one-, three-, and five-year periods. The Board also considered that the performance of the Fund’s Class I shares had ranked in the second quintile of the Fund’s Lipper-constructed Performance Group over the one-year period, the fifth quintile over the two-year period, the third quintile over the three- and four-year periods and the fourth quintile over the five-year period. Although the Fund underperformed compared with its peer group over the two- and five-year periods, the Board found that: (i) one-year performance had been good; (ii) recent performance had been very good; and (iii) during the year, changes were made to the Fund’s mandate to get more exposure to small-cap and international securities to improve the Fund’s performance. Based on its review, and giving particular weight to the nature and quality of the resources dedicated by the adviser and subadviser to improve relative performance, the Board concluded that the nature, extent, and quality of the services provided to the Fund will benefit the Fund’s shareholders.
The Board also considered that the Fund’s contractual advisory fee and breakpoints placed the Fund in the fourth quintile of its Lipper-constructed Expense Group and the Fund’s total expenses place the Fund in the third quintile. The Board found that the Fund’s advisory fee was within the range of fees charged by its peer group. Based on its review, the Board concluded that the Fund’s management fee and total expenses were fair and reasonable in light of the services that the Fund receives and other factors considered.
The Board considered that the Fund’s adviser reported a pre-tax profit margin for investment management services during each of the twelve month-periods ended September 30, 2006 and 2005. The Board considered the costs of the services provided by and the profits realized by the Fund’s adviser in connection with the operation of the Fund and determined that the amount of profit is a fair entrepreneurial profit for the management of the Fund.
Based upon its evaluation of all of the conclusions noted above, and after considering all material factors with respect to the Fund, the Board ultimately concluded that the advisory fee structure is fair and reasonable, and that the Advisory Agreement (and, if applicable, Sub-Advisory Agreement) with respect to the Fund, should be renewed.
B. Approval of New Advisory Agreement
At its January 11, 2007 meeting, the Board also unanimously approved a new investment advisory agreement (the “New Agreement”) for the Fund with Nationwide Fund Advisors, (“NFA”) the then-current adviser to each of the series of the Trust to become effective upon the closing of the acquisition of NFA by Nationwide Financial Services, Inc. (“NFS”) from Nationwide Corporation (“NWC”) which closed on April 30, 2007 (the “Transaction”). In approving the New Agreement, the Board considered NFA’s capacity to continue to provide the services needed to operate a sophisticated
C. Submission of Matters to a Vote of Security Holders:
On April 25, 2007, a Special Meeting of Shareholders was held* (the “April 25 Meeting”) at which shareholders of the Funds** set forth below were asked:
Proposal 1:
To approve a new investment advisory agreement, on behalf of their Fund, between Nationwide Fund Advisors (formerly “Gartmore Mutual Fund Capital Trust”) (the “Adviser”) and Nationwide Variable Insurance Trust (formerly “Gartmore Variable Insurance Trust”) (the “Trust”).
Number of Shares | ||||||||||
Fund | Cast/Not Cast | Percentages | ||||||||
Federated NVIT High Income Bond Fund | FOR | 30,051,703.188 shares | 92.514% | |||||||
(Formerly Federated GVIT | AGAINST | 618,245.021 shares | 1.903% | |||||||
High Income Bond Fund) | ABSTAIN | 1,813,550.431 shares | 5.583% | |||||||
TOTAL | 32,483,498.640 shares | |||||||||
NVIT International Index Fund | FOR | 4,322,203.982 shares | 96.897% | |||||||
(Formerly GVIT International | AGAINST | 2,758.318 shares | 0.062% | |||||||
Index Fund) | ABSTAIN | 135,636.840 shares | 3.041% | |||||||
TOTAL | 4,460,599.140 shares | |||||||||
NVIT International Value Fund | FOR | 20,032,843.199 shares | 93.351% | |||||||
(Formerly GVIT International | AGAINST | 333,588.902 shares | 1.554% | |||||||
Value Fund) | ABSTAIN | 1,093,293.879 shares | 5.095% | |||||||
TOTAL | 21,459,725.980 shares | |||||||||
NVIT Mid Cap Index Fund | FOR | 35,380,179.120 shares | 94.154% | |||||||
(Formerly GVIT Mid Cap Index Fund) | AGAINST | 631,117.844 shares | 1.679% | |||||||
ABSTAIN | 1,565,714.306 shares | 4.167% | ||||||||
TOTAL | 37,577,011.270 shares |
Number of Shares | ||||||||||
Fund | Cast/Not Cast | Percentages | ||||||||
NVIT S&P 500 Index Fund | FOR | 56,119,814.230 shares | 95.554% | |||||||
(Formerly GVIT S&P 500 Index Fund) | AGAINST | 666,195.542 shares | 1.134% | |||||||
ABSTAIN | 1,944,898.888 shares | 3.312% | ||||||||
TOTAL | 58,730,908.660 shares | |||||||||
Nationwide Multi-Manager NVIT | FOR | 7,632,918.513 shares | 92.700% | |||||||
Small Cap Growth Fund | AGAINST | 149,458.111 shares | 1.816% | |||||||
(Formerly GVIT Small Cap | ABSTAIN | 451,583.036 shares | 5.484% | |||||||
Growth Fund) | TOTAL | 8,233,959.660 shares | ||||||||
Nationwide Multi-Manager NVIT | FOR | 48,649,396.525 shares | 92.816% | |||||||
Small Cap Value Fund | AGAINST | 979,183.753 shares | 1.868% | |||||||
(Formerly GVIT Small Cap | ABSTAIN | 2,786,133.102 shares | 5.316% | |||||||
Value Fund) | TOTAL | 52,414,713.380 shares | ||||||||
Nationwide Multi-Manager NVIT | FOR | 29,903,181.700 shares | 91.311% | |||||||
Small Company Fund | AGAINST | 838,774.923 shares | 2.561% | |||||||
(Formerly GVIT Small Company Fund) | ABSTAIN | 2,006,741.307 shares | 6.128% | |||||||
TOTAL | 32,748,697.930 shares | |||||||||
Gartmore NVIT Developing | FOR | 21,0177,889.443 shares | 91.460% | |||||||
Markets Fund | AGAINST | 424,272.958 shares | 1.841% | |||||||
(Formerly Gartmore GVIT | ABSTAIN | 1,543,850.729 shares | 6.699% | |||||||
Developing Markets Fund) | TOTAL | 23,046,013.130 shares | ||||||||
Gartmore NVIT Emerging | FOR | 17,050,534.593 shares | 92.371% | |||||||
Markets Fund | AGAINST | 526,574.722 shares | 2.853% | |||||||
(Formerly Gartmore GVIT | ABSTAIN | 881,608.905 shares | 4.776% | |||||||
Emerging Markets Fund) | TOTAL | 18,458,718.220 shares | ||||||||
Nationwide NVIT Global | FOR | 1,554,847.333 shares | 95.589% | |||||||
Financial Services Fund | AGAINST | 19,539.033 shares | 1.201% | |||||||
(Formerly Gartmore GVIT | ABSTAIN | 52,206.494 shares | 3.210% | |||||||
Global Financial Services Fund) | TOTAL | 1,626,592.860 shares | ||||||||
Nationwide NVIT Global Health | FOR | 4,722,963.678 shares | 92.815% | |||||||
Sciences Fund | AGAINST | 157,979.030 shares | 3.104% | |||||||
(Formerly Gartmore GVIT | ABSTAIN | 207,642.222 shares | 4.081% | |||||||
Global Health Sciences Fund) | TOTAL | 5,088,584.930 shares | ||||||||
Nationwide NVIT Global Technology | FOR | 8,585,472.039 shares | 93.551% | |||||||
and Communications Fund | AGAINST | 102,267.977 shares | 1.114% | |||||||
(Formerly Gartmore GVIT | ABSTAIN | 489,577.634 shares | 5.335% | |||||||
Global Technology and Communications Fund) | TOTAL | 9,177,317.650 shares | ||||||||
Gartmore NVIT Global | FOR | 4,123,270.549 shares | 91.923% | |||||||
Utilities Fund | AGAINST | 122,001.533 shares | 2.720% | |||||||
(Formerly Gartmore GVIT | ABSTAIN | 240,276.088 shares | 5.357% | |||||||
Global Utilities Fund) | TOTAL | 4,485,548.170 shares | ||||||||
Nationwide NVIT Government | FOR | 88,471,567.462 shares | 92.024% | |||||||
Bond Fund | AGAINST | 1,825,645.181 shares | 1.899% | |||||||
(Formerly Gartmore GVIT | ABSTAIN | 5,841,990.727 shares | 6.077% | |||||||
Government Bond Fund) | TOTAL | 96,139,203.370 shares |
Number of Shares | ||||||||||
Fund | Cast/Not Cast | Percentages | ||||||||
Nationwide NVIT Growth Fund | FOR | 14,931,435.904 shares | 89.942% | |||||||
(Formerly Gartmore GVIT | AGAINST | 409,826.402 shares | 2.469% | |||||||
Growth Fund) | ABSTAIN | 1,259,945.064 shares | 7.589% | |||||||
TOTAL | 16,601,207.370 shares | |||||||||
Gartmore NVIT International | FOR | 6,251,419.070 shares | 93.569% | |||||||
Growth Fund | AGAINST | 139,618.548 shares | 2.090% | |||||||
(Formerly Gartmore GVIT | ABSTAIN | 290,025.592 shares | 4.341% | |||||||
International Growth Fund) | TOTAL | 6,681,063.210 shares | ||||||||
Nationwide NVIT Investor | FOR | 49,489,224.549 shares | 90.688% | |||||||
Destinations Aggressive Fund | AGAINST | 1,385,396.474 shares | 2.539% | |||||||
(Formerly Gartmore GVIT | ABSTAIN | 3,696,272.337 shares | 6.773% | |||||||
Investor Destinations Aggressive Fund) | TOTAL | 54,570,893.360 shares | ||||||||
Nationwide NVIT Investor | FOR | 23,091,965.887 shares | 89.855% | |||||||
Destinations Conservative Fund | AGAINST | 314,935,884 shares | 1.225% | |||||||
(Formerly Gartmore GVIT | ABSTAIN | 2,292,355.179 shares | 8.920% | |||||||
Investor Destinations Conservative Fund) | TOTAL | 25,699,256.950 shares | ||||||||
Nationwide NVIT Investor | FOR | 188,902,093.059 shares | 90.696% | |||||||
Destinations Moderate Fund | AGAINST | 3,018,924.590 shares | 1.449% | |||||||
(Formerly Gartmore GVIT | ABSTAIN | 16,359,690.401 shares | 7.855% | |||||||
Investor Destinations Moderate Fund) | TOTAL | 208,280,708.050 shares | ||||||||
Nationwide NVIT Investor | FOR | 134,792,622.920 shares | 91.332% | |||||||
Destinations Moderately Aggressive Fund | AGAINST | 3,489,207.264 shares | 2.364% | |||||||
(Formerly Gartmore GVIT Investor Destinations | ABSTAIN | 9,304,197.656 shares | 6.304% | |||||||
Moderately Aggressive Fund) | TOTAL | 147,586,027.840 shares | ||||||||
Nationwide NVIT Investor | FOR | 49,627,123.216 shares | 91.918% | |||||||
Destinations Moderately Conservative Fund | AGAINST | 856,088.634 shares | 1.586% | |||||||
(Formerly Gartmore GVIT Investor Destinations | ABSTAIN | 3,507,215.650 shares | 6.496% | |||||||
Moderately Conservative Fund) | TOTAL | 53,990,427.500 shares | ||||||||
Nationwide NVIT Mid Cap | FOR | 10,879,584.971 shares | 91.043% | |||||||
Growth Fund | AGAINST | 352,594.958 shares | 2.950% | |||||||
(Formerly Gartmore GVIT Mid | ABSTAIN | 717,792.971 shares | 6.007% | |||||||
Cap Growth Fund) | TOTAL | 11,949,972.900 shares | ||||||||
Nationwide NVIT Money Market | FOR | 221,774,863.241 shares | 88.508% | |||||||
Fund II | AGAINST | 12,322,482.494 shares | 4.918% | |||||||
(Formerly Gartmore GVIT Money | ABSTAIN | 16,471,740.875 shares | 6.574% | |||||||
Market Fund II) | TOTAL | 250,569,086.610 shares | ||||||||
Nationwide NVIT Money Market | FOR | 1,578,331,008.328 shares | 91.585% | |||||||
Fund | AGAINST | 32,372,133.671 shares | 1.878% | |||||||
(Formerly Gartmore GVIT Money | ABSTAIN | 112,652,123.301 shares | 6.537% | |||||||
Market Fund) | TOTAL | 1,723,355,265.300 shares | ||||||||
NVIT Nationwide Fund | FOR | 125,423,274.735 shares | 91.581% | |||||||
(Formerly Gartmore GVIT | AGAINST | 2,767,979.467 shares | 2.021% | |||||||
Nationwide Fund) | ABSTAIN | 8,762,255.828 shares | 6.398% | |||||||
TOTAL | 136,953,510.030 shares |
Number of Shares | ||||||||||
Fund | Cast/Not Cast | Percentages | ||||||||
NVIT Nationwide Leaders Fund | FOR | 2,298,504.956 shares | 95.780% | |||||||
(Formerly Gartmore GVIT | AGAINST | 29,630.469 shares | 1.235% | |||||||
Nationwide Leaders Fund) | ABSTAIN | 71,637.755 shares | 2.985% | |||||||
TOTAL | 2,399,773.180 shares | |||||||||
Nationwide NVIT U.S. Growth | FOR | 4,972,094.773 shares | 94.359% | |||||||
Leaders Fund | AGAINST | 122,623.161 shares | 2.327% | |||||||
(Formerly Gartmore GVIT U.S. | ABSTAIN | 174,625.606 shares | 3.314% | |||||||
Growth Leaders Fund) | TOTAL | 5,269,343.540 shares | ||||||||
Gartmore NVIT Worldwide | FOR | 2,666,862.487 shares | 94.126% | |||||||
Leaders Fund | AGAINST | 47,702.491 shares | 1.684% | |||||||
(Formerly Gartmore GVIT | ABSTAIN | 118,719.882 shares | 4.190% | |||||||
Worldwide Leaders Fund) | TOTAL | 2,833,284.860 shares | ||||||||
J.P. Morgan NVIT Balanced Fund | FOR | 15,966,867.546 shares | 90.900% | |||||||
(Formerly J.P. Morgan GVIT | AGAINST | 259,004.324 shares | 1.475% | |||||||
Balanced Fund) | ABSTAIN | 1,339,385.200 shares | 7.625% | |||||||
TOTAL | 17,565,257.070 shares | |||||||||
Van Kampen NVIT Comstock | FOR | 27,737,008.009 shares | 92.259% | |||||||
Value Fund | AGAINST | 502,564.164 shares | 1.672% | |||||||
(Formerly Van Kampen GVIT | ABSTAIN | 1,824,670.107 shares | 6.069% | |||||||
Comstock Value Fund) | TOTAL | 30,064,242.280 shares | ||||||||
Van Kampen NVIT Multi Sector | FOR | 21,253,297.665 shares | 90.281% | |||||||
Bond Fund | AGAINST | 484,100.920 shares | 2.056% | |||||||
(Formerly Van Kampen GVIT | ABSTAIN | 1,803,963.645 shares | 7.663% | |||||||
Multi Sector Bond Fund) | TOTAL | 23,541,362.230 shares | ||||||||
At the April 25 Meeting, shareholders of the Nationwide NVIT Mid Cap Growth Fund were also asked to approve a new investment subadvisory agreement among the Adviser, the Trust and NorthPointe Capital LLC. The voting results with respect to that proposal are set forth below:
Proposal 2
Number of Shares | ||||||||||
Fund | Cast/Not Cast | Percentages | ||||||||
Nationwide NVIT Mid Cap Growth | FOR | 10,862,827.499 shares | 90.903% | |||||||
Fund | AGAINST | 414,574.660 shares | 3.469% | |||||||
(Formerly Gartmore GVIT Mid | ABSTAIN | 672,570.741 shares | 5.628% | |||||||
Cap Growth Fund) | TOTAL | 11,949,972.900 shares | ||||||||
* | This meeting was previously adjourned on April 23, 2007. | |
** | Fund names were changed effective May 1, 2007 to reflect “Nationwide”/“NVIT” branding to coincide with the sale of Nationwide Fund Advisors, Inc. by Nationwide Corporation to its majority-owned subsidiary, Nationwide Financial Services, Inc. |
June 30, 2007 (Unaudited)
Contents | ||
6 | Statement of Investments | |
9 | Statement of Assets and Liabilities | |
10 | Statement of Operations | |
11 | Statements of Changes in Net Assets | |
13 | Financial Highlights | |
15 | Notes to Financial Statements |
Statement Regarding Availability of Proxy Voting Record.
SAR-VKCV (8/07) | ![]() |
Dear Fellow Shareholder:
Since I last wrote to you, our mutual funds have enjoyed another period of solid performance, and the corporate realignment that was in progress is now finished.
On May 1, 2007, Nationwide Financial Services, Inc. (NFS), completed its acquisition of the Philadelphia-based retail mutual fund operations of NWD Investment Management, Inc. (formerly, “Gartmore Global Investments, Inc.”), from Nationwide Corporation, a subsidiary of Nationwide Mutual Insurance Company. Effective that date, the acquired entities were renamed Nationwide Funds Group (NFG), and the Gartmore Funds were renamed the Nationwide Funds to better align with the Nationwide® brand. Although the corporate ownership and fund names have changed, I can assure you that NFG intends to maintain as much continuity as possible with the Funds and key personnel.
Thank you, shareholders, for approving the new investment advisory agreement that was required due to the change in corporate ownership. The new agreement is identical in all material respects to the original agreement that it replaces, with the exception of the section pertaining to the vote by the shareholders of the NVIT Mid Cap Growth Fund to approve NorthPointe Capital®, LLC (NorthPointe) as sub-adviser to that particular Fund.
Market Overview: January 1-June 30, 2007
Share prices in general were buoyed in part by better-than-expected first-quarter 2007 earnings and a flurry of mergers and acquisitions, many of these spurred by readily available funding from private equity firms. In June, investors grew more cautious amid surging crude oil prices, a sudden spike in long-term interest rates, and the meltdown of two hedge funds that had exposure to the subprime mortgage market. Looking abroad, a weak U.S. dollar aided foreign stocks, as reflected in the 11.09% advance of the Morgan Stanley Capital International Europe, Australasia and Far East (MSCI EAFE®) Index. Emerging market performance was particularly robust.
The bond market struggled during the first half of 2007. While short-term interest rates remained stable, reflecting the Federal Reserve Board’s decision in June to leave the target federal funds rate at 5.25%, longer-term rates climbed during the first half of 2007, depressing bond prices and forcing the Lehman Brothers® U.S. Aggregate Index to settle for a modest 0.97% return.
We at NFG thank you for your understanding and cooperation throughout our recent transition period. We emerge from this period energized for the future, and we look forward to serving your investment needs for a long time to come.
Nationwide Funds Group
PAST PERFORMANCE IS NO GUARANTEE OF FUTURE RESULTS.
Nationwide Funds are advised by Nationwide Fund Advisors (NFA). NFA is a wholly-owned subsidiary of Nationwide Financial Services. Nationwide Financial Services is a wholly-owned subsidiary of Nationwide Corporation. All of the common stock of Nationwide Corporation is held by Nationwide Mutual (95.2%) and Nationwide Mutual Fire Insurance Company (4.8%), each of which is a mutual company owned by its policyholders.
Nationwide Funds Group (NFG) is the mutual fund arm of Nationwide Financial Services (NYSE: NFS). Based in Conshohocken, Pa., a suburb of Philadelphia, NFG is comprised of Nationwide Fund Advisors, Nationwide Fund Distributors, LLC, and Nationwide Fund Management, LLC. Together, these provide advisory, distribution, and administration services respectively to the Nationwide Funds, and manage more than $43.5 billion in assets as of June 30, 2007, of which more than $12 billion are in “fund of funds” designed to provide asset allocation across several types of investments and asset classes.
Lehman Brothers (LB) U.S. Aggregate Index: An unmanaged, market value-weighted index of investment-grade, fixed-rate debt issues (including government, corporate, asset-backed, and mortgage-backed securities with maturities of one year or more) that is generally representative of the bond market as a whole.
Morgan Stanley Capital International Europe, Australasia and Far East (MSCI EAFE®) Index: An unmanaged, free float-adjusted, market capitalization-weighted index that is designed to measure the performance of stocks in developed markets outside the United States and Canada.
Standard & Poor’s 500® (S&P 500) Index: An unmanaged, market capitalization-weighted index of 500 widely held stocks of large-cap U.S. companies that gives a broad look at how the stock prices of those companies have performed.
Views expressed within are those of Nationwide Funds Group as of the date noted, are subject to change at any time, and may not come to pass.
This report is for informational purposes only, and is not intended as an offer or recommendation with respect to the purchase or sale of any security, option, future, or other derivatives in such securities.
Investing in mutual funds involves risk, including possible loss of principal.
Investors should carefully consider a fund’s investment objectives, risks, fees, charges, and expenses before investing any money. To obtain this and other fund information, please call 800-848-0920 to request a prospectus, or download a prospectus at www.nationwidefunds.com. Please read the prospectus carefully before investing any money.
Nationwide Funds distributed by Nationwide Fund Distributors LLC (formerly Gartmore Distribution Services, Inc.), Member NASD. 1200 River Road, Suite 1000, Conshohocken, Pa. 19428.
As a shareholder of the Fund, you incur two types of costs: (1) transaction costs, including sales charges (loads) paid on purchase payments and redemption fees; and (2) ongoing costs, including investment advisory fees, administration fees, distribution fees and other Fund expenses. The examples below are 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. Per SEC requirements, the examples assume that you had a $1,000 investment in the Class at the beginning of the reporting period, January 1, 2007, and continued to hold your shares at the end of the reporting period, June 30, 2007.
Actual Expenses
Hypothetical Example for Comparison Purposes
Please note that the expenses shown in the table are meant to highlight your ongoing costs only and do not reflect any transaction costs, such as sales charges (loads) or redemption fees. Therefore, the second line for each Class in 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 transaction costs were included, your costs would have been higher. The examples also assume all dividends and distributions have been reinvested.
Schedule of Shareholder Expenses
Beginning | Ending | Expenses Paid | Annualized | |||||||||||||||||||
Van Kampen NVIT Comstock Value Fund | Account Value | Account Value | During | Expense Ratio* | ||||||||||||||||||
1/1/07 06/30/07 Period* | ||||||||||||||||||||||
Class I | Actual | $ | 1,000.00 | $ | 1,060.80 | $ | 4.45 | 0.87% | ||||||||||||||
Hypothetical | 1 | $ | 1,000.00 | $ | 1,020.49 | $ | 4.37 | 0.87% | ||||||||||||||
Class II | Actual | $ | 1,000.00 | $ | 1,058.60 | $ | 6.33 | 1.24% | ||||||||||||||
Hypothetical | 1 | $ | 1,000.00 | $ | 1,018.65 | $ | 6.23 | 1.24% | ||||||||||||||
Class IV | Actual | $ | 1,000.00 | $ | 1,060.90 | $ | 4.34 | 0.85% | ||||||||||||||
Hypothetical | 1 | $ | 1,000.00 | $ | 1,020.58 | $ | 4.27 | 0.85% | ||||||||||||||
* | Expenses are equal to the Fund’s annualized expense ratio multiplied by the average account value over the period multiplied by 181/365 (to reflect the one-half year period). The expense ratio presented represents a six-month, annualized ratio in accordance with SEC guidelines. The expenses reported above do not include the effect of additional expenses imposed by variable annuity contracts. |
1 Represents the hypothetical 5% return before expenses.
Asset Allocation | ||||
Common Stock | 92.5% | |||
Repurchase Agreements | 7.2% | |||
Other Investments* | 13.5% | |||
Liabilities in excess of other assets** | -13.2% | |||
100.0% |
Top Holdings*** | ||||
Citigroup, Inc. | 3.9% | |||
Coca-Cola Co. | 3.3% | |||
Wyeth | 3.2% | |||
Comcast Corp. | 3.0% | |||
International Paper Co. | 3.0% | |||
Time Warner, Inc. | 2.9% | |||
Bristol-Myers Squibb Co. | 2.8% | |||
Viacom, Inc. | 2.7% | |||
Bank of America Corp. | 2.7% | |||
Verizon Communications, Inc. | 2.6% | |||
Other | 69.9% | |||
100.0% |
Top Industries | ||||
Pharmaceuticals | 15.9% | |||
Diversified Financial Services | 9.2% | |||
Media | 8.3% | |||
Insurance | 6.6% | |||
Food Products | 5.6% | |||
Commercial Banks | 5.2% | |||
Diversified Telecommunication Services | 4.1% | |||
Beverages | 4.0% | |||
Food & Staples Retailing | 3.9% | |||
Paper & Forest Products | 3.0% | |||
Other | 34.2% | |||
100.0% |
* | Includes value of collateral received from securities lending. |
** | Includes value of collateral owed from securities lending. |
*** | For purpose of listing top holdings, repurchase agreements are included as part of Other. |
Van Kampen NVIT Comstock Value Fund
Common Stock (92.5%) | ||||||||
Shares or | ||||||||
Principal Amount | Value | |||||||
Airline (0.7%) (a) | ||||||||
Southwest Airlines | 208,300 | $ | 3,105,753 | |||||
Beverages (4.0%) | ||||||||
Anheuser-Busch Cos., Inc. | 65,150 | 3,398,224 | ||||||
Coca-Cola Co. | 295,300 | 15,447,143 | ||||||
18,845,367 | ||||||||
Capital Markets (1.7%) | ||||||||
Bank of New York Co., Inc. | 160,400 | 6,646,976 | ||||||
Bear Stearns Cos., Inc. (The) | 11,800 | 1,652,000 | ||||||
8,298,976 | ||||||||
Chemicals (2.9%) (a) | ||||||||
E.I. du Pont de Nemours & Co. | 202,800 | 10,310,352 | ||||||
Rohm & Haas Co. | 59,100 | 3,231,588 | ||||||
13,541,940 | ||||||||
Commercial Banks (5.2%) | ||||||||
Barclays PLC ADR - GB | 12,700 | 708,533 | ||||||
PNC Bank Corp. (a) | 46,500 | 3,328,470 | ||||||
U.S. Bancorp | 64,700 | 2,131,865 | ||||||
Wachovia Corp. (a) | 236,705 | 12,131,131 | ||||||
Wells Fargo & Co. | 181,600 | 6,386,872 | ||||||
24,686,871 | ||||||||
Commercial Services & Supplies (0.3%) | ||||||||
Western Union Co. | 79,000 | 1,645,570 | ||||||
Communications Equipment (0.6%) | ||||||||
Cisco Systems, Inc.* | 42,500 | 1,183,625 | ||||||
Telefonaktiebolaget LM Ericsson ADR - SE (a) | 41,300 | 1,647,457 | ||||||
2,831,082 | ||||||||
Computers & Peripherals (2.7%) | ||||||||
Dell, Inc.* | 224,400 | 6,406,620 | ||||||
Hewlett-Packard Co. | 52,300 | 2,333,626 | ||||||
International Business Machines Corp. | 39,500 | 4,157,375 | ||||||
12,897,621 | ||||||||
Diversified Financial Services (9.2%) | ||||||||
Bank of America Corp. | 264,034 | 12,908,622 | ||||||
Citigroup, Inc. | 363,200 | 18,628,528 | ||||||
JP Morgan Chase & Co. | 138,500 | 6,710,325 | ||||||
Merrill Lynch & Co., Inc. | 65,500 | 5,474,490 | ||||||
43,721,965 | ||||||||
Diversified Telecommunication Services (4.1%) | ||||||||
AT&T, Inc. | 167,800 | 6,963,700 | ||||||
Verizon Communications, Inc. (a) | 298,510 | 12,289,657 | ||||||
19,253,357 | ||||||||
Electronic Equipment & Instruments (0.2%) (a) | ||||||||
ASM Lithography Holding NV ADR - NL* | 12,000 | 329,400 | ||||||
Cognex Corp. | 15,300 | 344,403 | ||||||
Flextronics International Ltd. - SG* | 36,800 | 397,440 | ||||||
1,071,243 | ||||||||
Food & Staples Retailing (3.9%) | ||||||||
CVS/ Caremark Corp. | 184,900 | 6,739,605 | ||||||
Wal-Mart Stores, Inc. | 244,700 | 11,772,517 | ||||||
18,512,122 | ||||||||
Food Products (5.6%) | ||||||||
Cadbury Schweppes PLC ADR - GB | 168,100 | 9,127,830 | ||||||
Kraft Foods, Inc. | 239,211 | 8,432,188 | ||||||
Unilever NV ADR - NL | 290,400 | 9,008,208 | ||||||
26,568,226 | ||||||||
Health Care Equipment & Supplies (0.6%) (a) | ||||||||
Boston Scientific Corp.* | 177,800 | 2,727,452 | ||||||
Health Care Providers & Services (1.4%) (a) | ||||||||
Cardinal Health, Inc. | 92,600 | 6,541,264 | ||||||
Household Products (2.1%) | ||||||||
Kimberly-Clark Corp. | 107,500 | 7,190,675 | ||||||
Procter & Gamble Co. (The) | 49,400 | 3,022,786 | ||||||
10,213,461 | ||||||||
Industrial Conglomerate (1.4%) | ||||||||
General Electric Co. | 172,200 | 6,591,816 | ||||||
Insurance (6.6%) | ||||||||
AFLAC, Inc. | 54,000 | 2,775,600 | ||||||
American International Group, Inc. (a) | 67,300 | 4,713,019 | ||||||
Berkshire Hathaway, Inc., Class B* (a) | 470 | 1,694,350 | ||||||
Chubb Corp. (The) | 178,780 | 9,679,149 | ||||||
Genworth Financial, Inc. (a) | 44,400 | 1,527,360 | ||||||
Hartford Financial Services Group, Inc. (The) | 19,900 | 1,960,349 | ||||||
MBIA, Inc. | 4,400 | 273,768 | ||||||
MetLife, Inc. (a) | 55,700 | 3,591,536 |
Common Stock (continued) | ||||||||
Shares or | ||||||||
Principal Amount | Value | |||||||
Insurance (continued) | ||||||||
Torchmark Corp. (a) | 30,600 | $ | 2,050,200 | |||||
Travelers Cos., Inc. (The) | 53,800 | 2,878,300 | ||||||
31,143,631 | ||||||||
Internet & Catalog Retail (1.0%) | ||||||||
Liberty Media Corp. - Interactive* | 219,774 | 4,907,553 | ||||||
IT Services (0.3%) | ||||||||
First Data Corp. | 46,300 | 1,512,621 | ||||||
Leisure Equipment & Products (2.9%) | ||||||||
Time Warner, Inc. | 648,000 | 13,633,920 | ||||||
Media (8.3%) | ||||||||
Clear Channel Communications, Inc. | 51,499 | 1,947,692 | ||||||
Comcast Corp., Class A* (a) | 504,000 | 14,172,480 | ||||||
Gannett Co. (a) | 25,400 | 1,395,730 | ||||||
Liberty Media Holding Corp. - Capital, Series A* | 40,314 | 4,744,152 | ||||||
News Corp., Class B (a) | 184,300 | 4,227,842 | ||||||
Viacom, Inc., Class B* (a) | 310,600 | 12,930,278 | ||||||
39,418,174 | ||||||||
Metals & Mining (1.7%) (a) | ||||||||
Alcoa, Inc. | 197,300 | 7,996,569 | ||||||
Paper & Forest Products (3.0%) (a) | ||||||||
International Paper Co. | 361,436 | 14,114,076 | ||||||
Pharmaceuticals (15.9%) | ||||||||
Abbott Laboratories (a) | 129,100 | 6,913,305 | ||||||
Bristol-Myers Squibb Co. | 421,100 | 13,289,916 | ||||||
Eli Lilly & Co. (a) | 192,200 | 10,740,136 | ||||||
GlaxoSmithKline PLC ADR - GB (a) | 140,100 | 7,337,037 | ||||||
Pfizer, Inc. (a) | 307,300 | 7,857,661 | ||||||
Roche Holding AG ADR - CH | 46,600 | 4,133,015 | ||||||
Sanofi-Aventis ADR - FR (a) | 65,700 | 2,645,739 | ||||||
Schering-Plough Corp. (a) | 248,700 | 7,570,428 | ||||||
Wyeth | 262,400 | 15,046,016 | ||||||
75,533,253 | ||||||||
Semiconductors & Semiconductor Equipment (1.5%) | ||||||||
Intel Corp. | 147,100 | 3,495,096 | ||||||
KLA-Tencor Corp. (a) | 23,600 | 1,296,820 | ||||||
Texas Instruments, Inc. | 56,200 | 2,114,806 | ||||||
6,906,722 | ||||||||
Software (0.6%) | ||||||||
McAfee, Inc.* (a) | 1,000 | 35,200 | ||||||
Microsoft Corp. | 92,300 | 2,720,081 | ||||||
2,755,281 | ||||||||
Specialty Retail (0.9%) | ||||||||
Home Depot, Inc. (The) | 48,000 | 1,888,800 | ||||||
Lowe’s Cos., Inc. (a) | 73,500 | 2,255,715 | ||||||
4,144,515 | ||||||||
Thrifts & Mortgage Finance (1.8%) (a) | ||||||||
Fannie Mae | 38,150 | 2,492,339 | ||||||
Freddie Mac | 103,280 | 6,269,096 | ||||||
8,761,435 | ||||||||
Tobacco (1.4%) | ||||||||
Altria Group, Inc. | 94,250 | 6,610,696 | ||||||
Total Common Stocks (Cost $386,905,269) | 438,492,532 | |||||||
Repurchase Agreements (7.2%) | ||||||||
Nomura Securities, 5.20%, dated 06/29/07, due 07/02/07, repurchase price $33,824,848, collateralized by U.S. Government Agency Mortgages with a market value of $34,486,401 | $ | 33,810,197 | 33,810,197 | |||||
Securities Held as Collateral for Securities on Loan (13.5%) | ||||||||
Morgan Stanley Repurchase Agreement, 5.42%, dated 06/29/07, due 07/02/07, repurchase price $64,119,106, collateralized by U.S. Government Agency Mortgages with a market value of $65,371,962 | 64,090,159 | 64,090,159 | ||||||
Total Investments (Cost $484,805,625) (b) — 113.2% | 536,392,888 | |||||||
Other assets in excess of liabilities — (13.2)% | (62,407,154 | ) | ||||||
NET ASSETS — 100.0% | $ | 473,985,734 | ||||||
Van Kampen NVIT Comstock Value Fund (Continued)
* | Denotes a non-income producing security. | |
(a) | All or a part of the security was on loan as of June 30, 2007. | |
(b) | See notes to financial statements for tax unrealized appreciation (depreciation) of securities. |
ADR | American Depository Receipt | |
CH | Switzerland | |
FR | France | |
GB | United Kingdom | |
NL | Netherlands | |
SE | Sweden | |
SG | Singapore |
See accompanying notes to financial statements.
Van Kampen | ||||||
NVIT Comstock | ||||||
Value Fund | ||||||
Assets: | ||||||
Investments, at value (cost $386,905,269)* | $ | 438,492,532 | ||||
Repurchase agreements, at cost and value | 97,900,356 | |||||
Total Investments | 536,392,888 | |||||
Interest and dividends receivable | 751,849 | |||||
Receivable for capital shares issued | 584,897 | |||||
Receivable for investments sold | 1,304,218 | |||||
Prepaid expenses | 4,511 | |||||
Total Assets | 539,038,363 | |||||
Liabilities: | ||||||
Payable to custodian | 17,403 | |||||
Payable for investments purchased | 365,215 | |||||
Payable upon return of securities loaned | 64,090,159 | |||||
Payable for capital shares redeemed | 141,147 | |||||
Accrued expenses and other payables: | ||||||
Investment advisory fees | 248,426 | |||||
Fund administration and transfer agent fees | 26,396 | |||||
Distribution fees | 60,427 | |||||
Administrative servicing fees | 77,495 | |||||
Compliance program costs | 4,827 | |||||
Other | 21,134 | |||||
Total Liabilities | 65,052,629 | |||||
Net Assets | $ | 473,985,734 | ||||
Represented by: | ||||||
Capital | $ | 412,963,905 | ||||
Accumulated net investment income | 36,330 | |||||
Accumulated net realized gains from investment transactions | 9,398,236 | |||||
Net unrealized appreciation on investments | 51,587,263 | |||||
Net Assets | $ | 473,985,734 | ||||
Net Assets: | ||||||
Class I Shares | $ | 113,528,972 | ||||
Class II Shares | 300,286,345 | |||||
Class IV Shares | 60,170,417 | |||||
Total | $ | 473,985,734 | ||||
Shares outstanding (unlimited number of shares authorized): | ||||||
Class I Shares | 8,620,367 | |||||
Class II Shares | 22,891,243 | |||||
Class IV Shares | 4,569,036 | |||||
Total | 36,080,646 | |||||
Net asset value and offering price per share (Net assets by class divided by shares outstanding by class, respectively.): | ||||||
Class I Shares | $ | 13.17 | ||||
Class II Shares | $ | 13.12 | ||||
Class IV Shares | $ | 13.17 | ||||
* | Includes value of securities on loan of $63,202,684. |
9
Van Kampen | |||||
NVIT Comstock | |||||
Value Fund | |||||
INVESTMENT INCOME: | |||||
Interest income | $ | 904,685 | |||
Dividend income | 4,711,430 | ||||
Income from securities lending | 25,778 | ||||
Total Income | 5,641,893 | ||||
Expenses: | |||||
Investment advisory fees | 1,363,199 | ||||
Fund administration and transfer agent fees | 128,004 | ||||
Distribution fees Class II Shares | 310,192 | ||||
Administrative servicing fees Class I Shares | 75,233 | ||||
Administrative servicing fees Class II Shares | 322,663 | ||||
Administrative servicing fees Class IV Shares | 34,490 | ||||
Custodian fees | 5,236 | ||||
Trustee fees | 9,011 | ||||
Compliance program costs (Note 3) | 2,819 | ||||
Other | 39,320 | ||||
Total expenses before earnings credit | 2,290,167 | ||||
Earnings credit (Note 6) | (161 | ) | |||
Net Expenses | 2,290,006 | ||||
Net Investment Income | 3,351,887 | ||||
REALIZED/ UNREALIZED GAINS (LOSSES) FROM INVESTMENTS: | |||||
Net realized gains on investment transactions | 10,952,884 | ||||
Net change in unrealized appreciation on investments | 9,797,882 | ||||
Net realized/unrealized gains (losses) on investments | 20,750,766 | ||||
CHANGE IN NET ASSETS RESULTING FROM OPERATIONS | $ | 24,102,653 | |||
10
Van Kampen NVIT | |||||||||
Comstock Value Fund | |||||||||
Six Months Ended | Year Ended | ||||||||
June 30, 2007 | December 31, 2006 | ||||||||
(Unaudited) | |||||||||
FROM INVESTMENT ACTIVITIES: | |||||||||
Operations: | |||||||||
Net investment income | $ | 3,351,887 | $ | 4,740,511 | |||||
Net realized gains on investment transactions | 10,952,884 | 11,140,738 | |||||||
Net change in unrealized appreciation on investments | 9,797,882 | 28,221,129 | |||||||
Change in net assets resulting from operations | 24,102,653 | 44,102,378 | |||||||
Distributions to shareholders from: | |||||||||
Net investment income: | |||||||||
Class I | (954,573 | ) | (1,826,431 | ) | |||||
Class II | (1,853,619 | ) | (2,003,632 | ) | |||||
Class IV | (507,365 | ) | (974,561 | ) | |||||
Net realized gains: | |||||||||
Class I | (177,572 | ) | (4,887,144 | ) | |||||
Class II | (464,395 | ) | (6,955,945 | ) | |||||
Class IV | (94,209 | ) | (2,554,158 | ) | |||||
Change in net assets from shareholder distributions | (4,051,733 | ) | (19,201,871 | ) | |||||
Change in net assets from capital transactions | 79,151,044 | 130,404,112 | |||||||
Change in net assets | 99,201,964 | 155,304,619 | |||||||
Net Assets: | |||||||||
Beginning of period | 374,783,770 | 219,479,151 | |||||||
End of period | $ | 473,985,734 | $ | 374,783,770 | |||||
Accumulated net investment income at end of period | $ | 36,330 | $ | – | |||||
11
Van Kampen NVIT | |||||||||
Comstock Value Fund | |||||||||
Six Months Ended | Year Ended | ||||||||
June 30, 2007 | December 31, 2006 | ||||||||
(Unaudited) | |||||||||
CAPITAL TRANSACTIONS: | |||||||||
Class I Shares | |||||||||
Proceeds from shares issued | $ | 6,402,785 | $ | 19,298,290 | |||||
Dividends reinvested | 1,132,143 | 6,713,570 | |||||||
Cost of shares redeemed | (11,679,297 | ) | (26,786,383 | ) | |||||
(4,144,369 | ) | (774,523 | ) | ||||||
Class II Shares | |||||||||
Proceeds from shares issued | 82,320,708 | 142,785,894 | |||||||
Dividends reinvested | 2,318,010 | 8,959,569 | |||||||
Cost of shares redeemed | (57,600 | ) | (18,984,524 | ) | |||||
84,581,118 | 132,760,939 | ||||||||
Class IV Shares | |||||||||
Proceeds from shares issued | 1,706,562 | 2,840,145 | |||||||
Dividends reinvested | 601,573 | 3,528,716 | |||||||
Cost of shares redeemed | (3,593,840 | ) | (7,951,165 | ) | |||||
(1,285,705 | ) | (1,582,304 | ) | ||||||
Change in net assets from capital transactions | $ | 79,151,044 | $ | 130,404,112 | |||||
SHARE TRANSACTIONS: | |||||||||
Class I Shares | |||||||||
Issued | 499,928 | 1,618,409 | |||||||
Reinvested | 87,498 | 566,876 | |||||||
Redeemed | (899,971 | ) | (2,233,381 | ) | |||||
(312,545 | ) | (48,096 | ) | ||||||
Class II Shares | |||||||||
Issued | 6,372,632 | 11,962,003 | |||||||
Reinvested | 179,632 | 751,926 | |||||||
Redeemed | (4,560 | ) | (1,640,417 | ) | |||||
6,547,704 | 11,073,512 | ||||||||
Class IV Shares | |||||||||
Issued | 132,954 | 239,370 | |||||||
Reinvested | 46,512 | 297,869 | |||||||
Redeemed | (276,845 | ) | (666,183 | ) | |||||
(97,379 | ) | (128,944 | ) | ||||||
Total change in shares | 6,137,780 | 10,896,472 | |||||||
12
Distributions | ||||||||||||||||||||
Investment Activities | ||||||||||||||||||||
Net Realized | ||||||||||||||||||||
and | ||||||||||||||||||||
Net Asset | Unrealized | Total | ||||||||||||||||||
Value, | Net | Gains | from | Net | ||||||||||||||||
Beginning | Investment | (Losses) on | Investment | Investment | ||||||||||||||||
of Period | Income | Investments | Activities | Income | ||||||||||||||||
Class I Shares | ||||||||||||||||||||
For the year ended December 31, 2002 | $ | 10.38 | $ | 0.12 | $ | (2.72 | ) | $ | (2.60 | ) | $ | (0.12 | ) | |||||||
For the year ended December 31, 2003 | $ | 7.66 | $ | 0.11 | $ | 2.28 | $ | 2.39 | $ | (0.11 | ) | |||||||||
For the year ended December 31, 2004 | $ | 9.94 | $ | 0.14 | $ | 1.59 | $ | 1.73 | $ | (0.14 | ) | |||||||||
For the year ended December 31, 2005 | $ | 11.53 | $ | 0.20 | $ | 0.29 | $ | 0.49 | $ | (0.19 | ) | |||||||||
For the year ended December 31, 2006 | $ | 11.53 | $ | 0.23 | $ | 1.55 | $ | 1.78 | $ | (0.21 | ) | |||||||||
For the six months ended June 30, 2007 (Unaudited) | $ | 12.54 | $ | 0.12 | $ | 0.64 | $ | 0.76 | $ | (0.11 | ) | |||||||||
Class II Shares | ||||||||||||||||||||
For the year ended December 31, 2003(e) | $ | 7.47 | $ | 0.08 | $ | 2.47 | $ | 2.55 | $ | (0.09 | ) | |||||||||
For the year ended December 31, 2004 | $ | 9.93 | $ | 0.11 | $ | 1.58 | $ | 1.69 | $ | (0.12 | ) | |||||||||
For the year ended December 31, 2005 | $ | 11.50 | $ | 0.14 | $ | 0.31 | $ | 0.45 | $ | (0.15 | ) | |||||||||
For the year ended December 31, 2006 | $ | 11.50 | $ | 0.16 | $ | 1.58 | $ | 1.74 | $ | (0.18 | ) | |||||||||
For the six months ended June 30, 2007 (Unaudited) | $ | 12.50 | $ | 0.09 | $ | 0.64 | $ | 0.73 | $ | (0.09 | ) |
[Additional columns below]
[Continued from above table, first column(s) repeated]
Distributions | ||||||||||||||||||||||||
Net Assets | ||||||||||||||||||||||||
Net | Net Asset | at End of | ||||||||||||||||||||||
realized | Total | Value, End | Total | Period | ||||||||||||||||||||
gains | Distributions | of Period | Return (a) | (000s) | ||||||||||||||||||||
Class I Shares | ||||||||||||||||||||||||
For the year ended December 31, 2002 | $ | – | $ | (0.12 | ) | $ | 7.66 | (25.14%) | $ | 39,424 | ||||||||||||||
For the year ended December 31, 2003 | $ | – | $ | (0.11 | ) | $ | 9.94 | 31.43% | $ | 62,517 | ||||||||||||||
For the year ended December 31, 2004 | $ | – | $ | (0.14 | ) | $ | 11.53 | 17.50% | $ | 112,202 | ||||||||||||||
For the year ended December 31, 2005 | $ | (0.30 | ) | $ | (0.49 | ) | $ | 11.53 | 4.25% | $ | 103,565 | |||||||||||||
For the year ended December 31, 2006 | $ | (0.56 | ) | $ | (0.77 | ) | $ | 12.54 | 15.91% | $ | 112,029 | |||||||||||||
For the six months ended June 30, 2007 (Unaudited) | $ | (0.02 | ) | $ | (0.13 | ) | $ | 13.17 | 6.08% | $ | 113,529 | |||||||||||||
Class II Shares | ||||||||||||||||||||||||
For the year ended December 31, 2003(e) | $ | – | $ | (0.09 | ) | $ | 9.93 | 34.20% | $ | 6,092 | ||||||||||||||
For the year ended December 31, 2004 | $ | – | $ | (0.12 | ) | $ | 11.50 | 17.08% | $ | 34,312 | ||||||||||||||
For the year ended December 31, 2005 | $ | (0.30 | ) | $ | (0.45 | ) | $ | 11.50 | 3.95% | $ | 60,617 | |||||||||||||
For the year ended December 31, 2006 | $ | (0.56 | ) | $ | (0.74 | ) | $ | 12.50 | 15.56% | $ | 204,233 | |||||||||||||
For the six months ended June 30, 2007 (Unaudited) | $ | (0.02 | ) | $ | (0.11 | ) | $ | 13.12 | 5.86% | $ | 300,286 |
[Additional columns below]
[Continued from above table, first column(s) repeated]
Ratios / Supplemental Data | ||||||||||||||||||||
Ratio of Net | ||||||||||||||||||||
Ratio of | Ratio of | Investment | ||||||||||||||||||
Net | Expenses | Income | ||||||||||||||||||
Ratio of | Investment | (Prior to | (Prior to | |||||||||||||||||
Expenses | Income | Reimbursements) | Reimbursements) | |||||||||||||||||
to Average | to Average | to Average | to Average | Portfolio | ||||||||||||||||
Net Assets (b) | Net Assets (b) | Net Assets (b) (c) | Net Assets (b) (c) | Turnover (d) | ||||||||||||||||
Class I Shares | ||||||||||||||||||||
For the year ended December 31, 2002 | 1.11% | 1.30% | 1.11% | 1.30% | 245.24% | |||||||||||||||
For the year ended December 31, 2003 | 0.99% | 1.37% | (g) | (g) | 71.31% | |||||||||||||||
For the year ended December 31, 2004 | 0.94% | 1.41% | (g) | (g) | 31.95% | |||||||||||||||
For the year ended December 31, 2005 | 0.94% | 1.65% | (g) | (g) | 33.13% | |||||||||||||||
For the year ended December 31, 2006 | 0.93% | 1.84% | (g) | (g) | 25.62% | |||||||||||||||
For the six months ended June 30, 2007 (Unaudited) | 0.87% | 1.82% | 0.87% | 1.82% | 12.08% | |||||||||||||||
Class II Shares | ||||||||||||||||||||
For the year ended December 31, 2003(e) | 1.20% | 1.27% | 1.31% | 1.16% | 71.31% | |||||||||||||||
For the year ended December 31, 2004 | 1.20% | 1.20% | 1.28% | 1.11% | 31.95% | |||||||||||||||
For the year ended December 31, 2005 | 1.28% | 1.31% | 1.31% | 1.29% | 33.13% | |||||||||||||||
For the year ended December 31, 2006 | 1.26% | 1.45% | (g) | (g) | 25.62% | |||||||||||||||
For the six months ended June 30, 2007 (Unaudited) | 1.24% | �� | 1.43% | 1.24% | 1.43% | 12.08% |
(a) | Not annualized for periods less than one year. |
(b) | Annualized for periods less than one year. |
(c) | During the period, certain fees were waived and/or reimbursed. If such waivers/reimbursements had not occurred, the ratios would have been as indicated. |
(d) | Portfolio turnover is calculated on the basis of the Fund as a whole without distinguishing among the classes of shares. |
(e) | For the period from March 28, 2003 (commencement of operations) through December 31, 2003. |
(f) | For the period from April 28, 2003 (commencement of operations) through December 31, 2003. |
(g) | There were no fee reductions during the period. |
[Additional columns below]
[Continued from above table, first column(s) repeated]
Distributions | ||||||||||||||||||||
Investment Activities | ||||||||||||||||||||
Net Realized | ||||||||||||||||||||
and | ||||||||||||||||||||
Net Asset | Unrealized | Total | ||||||||||||||||||
Value, | Net | Gains | from | Net | ||||||||||||||||
Beginning | Investment | (Losses) on | Investment | Investment | ||||||||||||||||
of Period | Income | Investments | Activities | Income | ||||||||||||||||
Class IV Shares | ||||||||||||||||||||
For the year ended December 31, 2003(f) | $ | 7.76 | $ | 0.09 | $ | 2.18 | $ | 2.27 | $ | (0.09 | ) | |||||||||
For the year ended December 31, 2004 | $ | 9.94 | $ | 0.15 | $ | 1.57 | $ | 1.72 | $ | (0.14 | ) | |||||||||
For the year ended December 31, 2005 | $ | 11.52 | $ | 0.19 | $ | 0.31 | $ | 0.50 | $ | (0.19 | ) | |||||||||
For the year ended December 31, 2006 | $ | 11.53 | $ | 0.23 | $ | 1.55 | $ | 1.78 | $ | (0.21 | ) | |||||||||
For the six months ended June 30, 2007 (Unaudited) | $ | 12.54 | $ | 0.12 | $ | 0.64 | $ | 0.76 | $ | (0.11 | ) | |||||||||
[Additional columns below]
[Continued from above table, first column(s) repeated]
Distributions | Ratios / Supplemental Data | ||||||||||||||||||||||||
Net Assets | Ratio of | ||||||||||||||||||||||||
Net | Net Asset | at End of | Expenses | ||||||||||||||||||||||
realized | Total | Value, End | Total | Period | to Average | ||||||||||||||||||||
gains | Distributions | of Period | Return (a) | (000s) | Net Assets (b) | ||||||||||||||||||||
Class IV Shares | �� | ||||||||||||||||||||||||
For the year ended December 31, 2003(f) | $ | – | $ | (0.09 | ) | $ | 9.94 | 29.38% | $ | 48,070 | 0.94% | ||||||||||||||
For the year ended December 31, 2004 | $ | – | $ | (0.14 | ) | $ | 11.52 | 17.42% | $ | 55,683 | 0.91% | ||||||||||||||
For the year ended December 31, 2005 | $ | (0.30 | ) | $ | (0.49 | ) | $ | 11.53 | 4.36% | $ | 55,297 | 0.93% | |||||||||||||
For the year ended December 31, 2006 | $ | (0.56 | ) | $ | (0.77 | ) | $ | 12.54 | 15.94% | $ | 58,521 | 0.90% | |||||||||||||
For the six months ended June 30, 2007 (Unaudited) | $ | (0.02 | ) | $ | (0.13 | ) | $ | 13.17 | 6.09% | $ | 60,170 | 0.85% | |||||||||||||
[Additional columns below]
[Continued from above table, first column(s) repeated]
Ratios / Supplemental Data | ||||||||||||||||||
Ratio of Net | ||||||||||||||||||
Ratio of | Ratio of | Investment | ||||||||||||||||
Net | Expenses | Income | ||||||||||||||||
Investment | (Prior to | (Prior to | ||||||||||||||||
Income | Reimbursements) | Reimbursements) | ||||||||||||||||
to Average | to Average | to Average | Portfolio | |||||||||||||||
Net Assets (b) | Net Assets (b) (c) | Net Assets (b) (c) | Turnover (d) | |||||||||||||||
Class IV Shares | ||||||||||||||||||
For the year ended December 31, 2003(f) | 1.50% | (g) | (g) | 71.31% | ||||||||||||||
For the year ended December 31, 2004 | 1.42% | (g) | (g) | 31.95% | ||||||||||||||
For the year ended December 31, 2005 | 1.67% | (g) | (g) | 33.13% | ||||||||||||||
For the year ended December 31, 2006 | 1.86% | (g) | (g) | 25.62% | ||||||||||||||
For the six months ended June 30, 2007 (Unaudited) | 1.83% | 0.85% | 1.83% | 12.08% | ||||||||||||||
(a) | Not annualized for periods less than one year. | |
(b) | Annualized for periods less than one year. | |
(c) | During the period, certain fees were waived and/or reimbursed. If such waivers/reimbursements had not occurred, the ratios would have been as indicated. | |
(d) | Portfolio turnover is calculated on the basis of the Fund as a whole without distinguishing among the classes of shares. | |
(e) | For the period from March 28, 2003 (commencement of operations) through December 31, 2003. | |
(f) | For the period from April 28, 2003 (commencement of operations) through December 31, 2003. | |
(g) | There were no fee reductions during the period. |
See accompanying notes to financial statements.
1. Organization
Nationwide Variable Insurance Trust (“NVIT” or the “Trust”) is an open-end management investment company, organized under the laws of Delaware by an amended and restated Agreement and Declaration of Trust, dated October 28, 2004, as amended to date. Prior to May 1, 2007, the Trust was named “Gartmore Variable Insurance Trust”. The Trust, originally created under the laws of Massachusetts as a Massachusetts business trust pursuant to a Declaration of Trust dated, as of June 30, 1981, and as subsequently amended, redomesticated as a Delaware Statutory Trust after the close of trading on April 29, 2005, and is registered under the Investment Company Act of 1940, as amended (the “1940 Act”). The redomestication was a change in statutory status and did not affect the operations of the Trust. As of June 30, 2007, the Trust had authorized an unlimited number of shares of beneficial interest, without par value (“shares”). The Trust currently offers shares to life insurance company separate accounts to fund the benefits under variable life insurance or annuity policies. To date, only the separate accounts of Nationwide Life Insurance Company and Nationwide Life and Annuity Insurance Company (collectively, “Nationwide”) have purchased shares of the Van Kampen NVIT Comstock Value Fund (the “Fund”), (formerly, “Van Kampen GVIT Comstock Value Fund”). The Trust currently operates forty (40) separate series, or mutual funds, each with its own investment objectives and strategies. This report contains the financial statements and financial highlights of the Fund.
2. Summary of Significant Accounting Policies
The following is a summary of significant accounting policies followed by the Fund in the preparation of its financial statements. The policies are in conformity with accounting principles generally accepted in the United States of America (“GAAP”). The preparation of financial statements requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of income and expenses for the period. Actual results could differ from those estimates.
(a) | Security Valuation |
Securities for which market quotations are readily available are valued at current market value as of “Valuation Time.” Valuation Time is as of the close of regular trading on the New York Stock Exchange (usually 4 p.m. Eastern time). Equity securities are valued at the last quoted sale price or, if there is no sale price, the last quoted bid price provided by an independent pricing service approved by the Trust’s Board of Trustees (“Board of Trustees”). Securities traded on NASDAQ are valued at the NASDAQ official closing price. Prices are taken from the primary market or exchange in which each security trades. | |
Most securities listed on a foreign exchange are valued either at fair value (see description below) or at the last sale price at the close of the exchange on which the security is principally traded. Foreign securities, currencies, and other assets and liabilities denominated in foreign currencies are translated into U.S. dollars at the exchange rate of said currencies against the U.S. dollar, as of Valuation Time, as provided by an independent pricing service approved by the Board of Trustees. | |
Securities for which market quotations are not readily available, or for which an independent pricing service does not provide a value or provides a value that does not represent fair value in the judgment of the Fund’s investment adviser or designee, are valued at fair value under procedures approved by the Board of Trustees. The “Fair Value” of these securities is determined in good faith by taking into account relevant factors and surrounding circumstances. Methods utilized to obtain a “Fair Value” may include the following non-exclusive list of acceptable methods: (i) a multiple of earnings; (ii) the discount from market value of a similar, freely traded security; (iii) the yield-to-maturity for debt issues; or (iv) a consolidation of the methods. The Trust’s Valuation & Operations Committee considers a non-exclusive list of factors to arrive at the appropriate method of determining “Fair Value.” For example, fair value determinations are required for securities whose value is affected by a “significant” event that materially affects the value of a domestic or foreign security which occurs subsequent to the time of the close of the principal market on which such domestic or foreign security trades and before the Valuation Time (i.e., a “subsequent event”). Typically, |
this will involve events occurring after the close of a foreign market on which a security trades and before the next Valuation Time. | |
The Fund values foreign securities at fair value in the circumstances described below. Generally, trading in foreign securities markets is completed each day at various times prior to the Valuation Time. Due to the time differences between the closings of the relevant foreign securities exchanges and the Valuation Time for the Fund, the Fund will fair value its foreign investments when it is determined that the market quotations for the foreign investments either are not readily available or are unreliable and, therefore, do not represent fair value. When the fair value prices are utilized, these prices will attempt to reflect the impact of the U.S. financial markets’ perceptions and trading activities on the Fund’s foreign investments since the last closing prices of the foreign investments were calculated on their primary foreign securities markets or exchanges. For these purposes, the Board of Trustees has determined that movements in relevant indices or other appropriate market indicators, after the close of the foreign securities exchanges, may demonstrate that market quotations are unreliable, and may trigger fair value pricing for certain securities. Consequently, fair valuation of portfolio securities may occur on a daily basis. |
(b) | Repurchase Agreements |
The Fund may enter into repurchase agreements with an entity which is a member of the Federal Reserve System or which is a “primary dealer” (as designated by the Federal Reserve Bank of New York) in U.S. Government obligations. The repurchase price generally equals the price paid by the Fund plus interest negotiated on the basis of current short-term rates, which may be more or less than the rate on the underlying portfolio securities. The seller under a repurchase agreement is required to maintain the value of the collateral held pursuant to the agreement at a market value equal to or greater than the repurchase price (including accrued interest). Collateral subject to repurchase agreements is held by the Fund’s custodian or another qualified sub-custodian or in the Federal Reserve/ Treasury book-entry system. If the counterparty defaults and the fair value of the collateral declines, realization of the collateral by the Fund may be delayed or limited. The Fund may transfer uninvested cash balances into a pooled cash account. These balances are invested in one or more repurchase agreements, with the counterparty of Nomura Securities, which is fully collateralized by U.S. Government Agency Mortgages. |
(c) | Futures Contracts |
The Fund may invest in financial futures contracts (“futures contracts”) for the purpose of hedging its existing portfolio securities or securities that the Fund intends to purchase against fluctuations in value caused by changes in prevailing market interest rates or prices. Futures contracts may also be entered into for non-hedging purposes. | |
Upon entering into a futures contract, the Fund is required to pledge to the broker an amount of cash and/or other assets equal to a certain percentage of the contract amount (initial margin deposit). Subsequent payments, known as “variation margin,” are made each day, depending on the daily fluctuations in the fair value/market value of the underlying assets. A gain or loss equal to the daily variation margin is recognized on a daily basis. Futures contracts are valued daily at their last quoted sale price. | |
A “sale” of a futures contract means the creation of a contractual obligation to deliver the securities or foreign currency called for by the contract at a fixed price at a specified time in the future. A “purchase” of a futures contract means the creation of a contractual obligation to acquire the securities or foreign currency at a fixed price at a specified time in the future. | |
Should market conditions change unexpectedly, the Fund may not achieve the anticipated benefits of the futures contracts and may realize a loss. The use of futures transactions for hedging purposes involves the risk of imperfect correlation in movements in the price of futures contracts, interest rates, and the value of the underlying hedged assets. |
(d) | Written Options Contracts |
The Fund may write options contracts. A written option obligates the Fund to deliver (written call) or to receive (written put) a specified quantity of an underlying asset at the contract amount upon exercise by the holder of the option. When the Fund writes an option, an amount equal to the premium received by the Fund is recorded as a liability and is subsequently adjusted to the current fair value of the option written. Premiums received from writing options that expire unexercised are treated by the Fund on the expiration date as realized gains from investments. The difference between the premium and the amount paid on effecting a closing purchase transaction, as a realized loss. If a call option is exercised, the premium is added to the proceeds from the sale of the underlying security or currency in determining whether the Fund has realized a gain or loss. If a put option is exercised, the premium reduces the cost basis of the securities purchased by the Fund. Options traded on an exchange are valued at the last quoted sale price, or in the absence of a sale, the bid price provided by an independent pricing service approved by the Board of Trustees. Non-exchange traded options are valued using dealer supplied quotes. The Fund as a writer of an option bears the market risk of an unfavorable change in the price of the security underlying the written option. |
(e) | Security Transactions and Investment Income |
Security transactions are accounted for on the date the security is purchased or sold (“trade date”). Securities gains and losses are calculated on the identified cost basis. Interest income is recognized on the accrual basis and includes, where applicable, the amortization or accretion of premium or discount. Dividend income is recorded on the ex-dividend date. |
(f) | Securities Lending |
To generate additional income, the Fund may lend its portfolio securities, up to 33 1/3% of the Fund, to brokers, dealers and other financial institutions provided that (1) the borrower delivers cash or securities as collateral with respect to each new loan of U.S. securities, equal to at least 102% of the value of the portfolio securities loaned, and with respect to each new loan on non-U.S. securities, collateral of at least 105% of the value of the portfolio securities loaned; and (2) at all times thereafter shall require the borrower to mark-to-market the collateral on a daily basis so that the market value of such collateral does not fall below 100% of the value of securities loaned. The Fund receives payments from borrowers equivalent to the dividends and interest that would have been earned on securities loaned while simultaneously seeking to earn income on the investment of cash collateral. There may be risks of delay in recovery of the securities should the borrower of the securities fail financially. Loans will be made, however, only to borrowers deemed by the Fund’s investment adviser to be of good standing and creditworthy under guidelines established by the Board of Trustees and when, in judgment of the adviser, the consideration which can be earned currently from these securities loans justifies the attendant risks. Loans are subject to termination by the Fund or the borrower at any time, and, therefore, are not considered to be illiquid investments. JP Morgan Chase Bank serves as custodian for the securities lending program of the Fund. JP Morgan Chase Bank receives a fee based on the value of the collateral received from borrowers. | |
Information on the investment of cash collateral is shown in the Statement of Investments. | |
As of June 30, 2007, the Fund had securities with the following value on loan: |
Value of Loaned Securities | Value of Collateral | |||||
$63,202,684 | $ | 64,090,159 | ||||
(g) | Distributions to Shareholders |
The Fund’s dividends from net investment income, if any, are declared and paid quarterly. The Fund’s distributions from net realized capital gains, if any, are declared and distributed at least annually. | |
Dividends and distributions to shareholders are determined in accordance with federal income tax regulations, which may differ from GAAP. These “book/tax” differences are considered either permanent or temporary in nature. In |
accordance with the American Institute of Certified Public Accountants Statement of Position 93-2, permanent differences (i.e., reclassification of market discounts, foreign exchange gain/loss, paydowns, and distributions from real estate investment trusts) are reclassified within the capital accounts based on their nature for federal income tax purposes; temporary differences do not require reclassification. These reclassifications have no effect upon the net asset value of the Fund. To the extent distributions exceed current and accumulated earnings and profits for federal income tax purposes, these distributions are reported as distributions of paid-in-capital. |
(h) | Federal Income Taxes |
It is the policy of the Fund to qualify or to continue to qualify as a “regulated investment company” by complying with the provisions available to certain investment companies, as defined in Subchapter M of the U.S. Internal Revenue Code, and to make distributions of net investment income and net realized capital gains sufficient to relieve the Fund from all, or substantially all, federal income taxes. | |
As of June 30, 2007, the tax cost of securities and the breakdown of unrealized appreciation (depreciation) for the Fund was as follows: |
Net Unrealized | ||||||||||||||||||
Tax Cost of | Unrealized | Unrealized | Appreciation | |||||||||||||||
Securities | Appreciation | Depreciation | (Depreciation) | |||||||||||||||
$ | 485,841,563 | $ | 53,093,878 | $ | (2,542,553 | ) | $ | 50,551,325 | ||||||||||
(i) | Allocation of Expenses, Income, and Gains and Losses |
Expenses directly attributable to the Fund are charged to the Fund. Expenses not directly attributable to the Fund are allocated proportionately among various or all funds within the Trust. The method used by the Fund for allocating income, fund level expenses, and realized and unrealized gains or losses is based on the fair value of shares outstanding relative to net assets. Under this method, each class of shares participates based on the total net asset value of that class’s shares in proportion to the total net assets of the Fund. Expenses specific to a class (such as Rule 12b-1 and administrative services fees) are charged to that class. |
3. Transactions with Affiliates
Under the terms of the Trust’s Investment Advisory Agreement, Nationwide Fund Advisors (formerly, Gartmore Mutual Fund Capital Trust (“GMF”)) (“NFA” or the “Advisor”) manages the investment of the assets and supervises the daily business affairs of the Fund. NFA is a wholly-owned subsidiary of Nationwide Financial Services (“NFS”). In addition, NFA provides investment management evaluation services in initially selecting and monitoring, on an ongoing basis, the performance of the subadviser for the Fund. Van Kampen Asset Management, Inc. (the “subadviser”), manages all of the Fund’s investments and has the responsibility for making all investment decisions for the Fund.
Under the terms of the Investment Advisory Agreement, the Fund pays NFA an investment advisory fee based on that Fund’s average daily net assets. Additional information regarding investment advisory fees and subadvisory fees for NFA and the subadviser is as follows for the six months ended June 30, 2007:
Total | ||||||
Fee Schedule | Fees | |||||
Up to $50 million | 0.80% | |||||
Next $200 million | 0.65% | |||||
Next $250 million | 0.60% | |||||
$500 million or more | 0.55% | |||||
From such fees, pursuant to the subadvisory agreement, NFA paid the subadviser $601,060 for the six months ended June 30, 2007.
As of the six months ended June 30, 2007, the cumulative potential reimbursements for the Class IV shares of the Fund, based on reimbursements which expire within three years from the fiscal year in which the corresponding reimbursement to the Fund was made for expenses reimbursed by NFA would be:
Amount Fiscal Year 2004 | Amount Fiscal Year 2005 | Amount Fiscal Year 2006 | ||||||||||||
$ | 14,072 | $ | 10,247 | $ | 0 | |||||||||
Under the terms of a Fund Administration and Transfer Agency Agreement, Nationwide Fund Management, LLC (formerly, Gartmore Investor Services, Inc. (“GISI”)) (“NFM”), a wholly-owned subsidiary of NFS Distributors, Inc. (“NFSDI”), provides the Fund with various administrative and accounting services for the Fund (prior to May 1, 2007, this service was provided by Gartmore SA Capital Trust (“GSA”)), and serves as Transfer and Dividend Disbursing Agent for the Fund (prior to May 1, 2007, this service was provided by GISI, an indirect subsidiary of GSA.) The fees for the services provided under this Agreement are calculated based on the Trust’s average daily net assets according to the fee schedule below. The fees are then allocated proportionately among all funds within the Trust in relation to the average daily net assets of each fund and are paid to NFA. NFA pays NFM from these fees for NFM’s services.
Combined Fee Schedule* | ||||||
Up to $1 billion | 0.15% | |||||
$1 billion up to $3 billion | 0.10% | |||||
$3 billion up to $8 billion | 0.05% | |||||
$8 billion up to $10 billion | 0.04% | |||||
$10 billion up to $12 billion | 0.02% | |||||
$12 billion or more | 0.01% | |||||
* | The assets of the Nationwide NVIT Investor Destinations Aggressive Fund, the Nationwide NVIT Investor Destinations Moderately Aggressive Fund, the Nationwide NVIT Investor Destinations Moderate Fund, the Nationwide NVIT Investor Destinations Moderately Conservative Fund, and the Nationwide NVIT Investor Destinations Conservative Fund (collectively, the “Investor Destinations Funds”) are excluded from the Trust asset level amount in order to calculate this asset-based fee. The Investor Destinations Funds do not pay any part of this fee. |
NFA and NFM have entered into agreements with Citi Fund Services Ohio, Inc. (“Citi”), pursuant to which Citi provides sub-administration and sub-transfer agency services, respectively, to the Fund. Effective August 1, 2007, The BISYS Group Inc. was acquired by and became a wholly owned subsidiary of Citi.
Under the terms of a Distribution Plan under Rule 12b-1 of the 1940 Act, Nationwide Fund Distributors, LLC. (formerly, “Gartmore Distribution Services, Inc.) (“NFD” or “Distributor”), the Fund’s principal underwriter, is compensated by the Fund for expenses associated with the distribution of the Class II shares of the Fund. NFD is a wholly-owned subsidiary of NFSDI. These fees are based on average daily net assets of Class II shares of the Fund at an annual rate not to exceed 0.25%.
Under the terms of an Administrative Services Plan, the Fund may pay fees to servicing organizations, such as broker-dealers, including NFS and financial institutions, which agree to provide administrative support services to the shareholders of certain classes. These services include, but are not limited, to the following: establishing and maintaining shareholder accounts; processing purchase and redemption transactions; arranging bank wires; performing shareholder sub-accounting; answering inquires regarding the Fund; and other such services. These fees are based on an annual rate of up to 0.25% of the average daily net assets of Class I and Class II shares of the Fund and 0.20% of Class IV shares of the Fund.
For the six months ended June 30, 2007, NFS received $432,131 in Administrative Services Fees from the Fund.
Under the terms of a letter agreement dated September 12, 2006, by and among NFA, the Audit Committee of the Trust and the Trust, the Trust has agreed to reimburse NFA certain costs related to the Fund’s portion of ongoing administration, monitoring and annual (audit) testing of the Trust’s Rule 38a-1 Compliance Program subject to the pre-
For the six months ended June 30, 2007, the advisers or affiliates of the advisers directly held 2.55% of the shares outstanding of the Fund.
4. Investment Transactions
For the six months ended June 30, 2007, (excluding short-term securities) the Fund had purchases of $124,588,511 and sales of $47,001,164.
5. Bank Loans and Earnings Credit
The Trust has a credit agreement with JP Morgan Chase & Co., the Fund’s custodian bank, permitting the Trust to borrow up to $100,000,000. Borrowings under this arrangement bear interest at the Federal Funds rate plus 0.50%. The interest costs, if any, would be included in other fees in the Statement of Operations. No compensating balances were required under the terms of the line of credit. The line of credit is renewed annually, expiring on June 25, 2008, with a commitment fee of 0.07% per year on $100,000,000. There were no borrowings outstanding under this line of credit for the six months ended June 30, 2007.
The Trust’s custodian bank has agreed to reduce the bank’s fees (earnings credit) when the funds of the Trust maintain cash on deposit in non-interest-bearing custody and Demand Deposit Accounts. Earnings credits are shown as a reduction of total expenses on the Statement of Operations.
6. Portfolio Investment Risks
Risks Associated with Foreign Securities and Currencies. Investments in securities of foreign issuers carry certain risks not ordinarily associated with investments in securities of U.S. issuers. These risks include future political and economic developments, and the possible imposition of exchange controls or other foreign governmental laws and restrictions. In addition, with respect to certain countries, there is the possibility of expropriation of assets, confiscatory taxation, political or social instability, or diplomatic developments, which could adversely affect investments in those countries.
Certain countries also may impose substantial restrictions on investments in their capital markets by foreign entities, including restrictions on investments in issuers of industries deemed sensitive to relevant national interests. These factors may limit the investment opportunities available and result in a lack of liquidity and high price volatility with respect to securities of issuers from developing countries.
7. Indemnifications
Under the Trust’s organizational documents, certain of the Trust’s Officers and Trustees are indemnified against certain liabilities arising out of the performance of their duties to the Trust. In addition, the Trust has entered into Indemnification Agreements with the Trust’s trustees and certain officers covering similar liabilities. Trust Officers receive no compensation from the Trust for serving as the Trust’s Officers. In addition, in the normal course of business, the Trust enters into contracts with its vendors and others that provide for general indemnifications. The Trust’s maximum exposure under these arrangements is unknown, as this would involve future claims that may be made against the Trust. Based on experience, however, the Trust expects that risk of loss to be remote.
8. Recently Issued Accounting Pronouncements
On July 13, 2006, the Financial Accounting Standards Board (“FASB”) released FASB Interpretation No. 48, Accounting for Uncertainty in Income Taxes (“FIN 48”). FIN 48 provides guidance for how uncertain tax positions should be recognized, measured, presented and disclosed in the financial statements. FIN 48 requires the affirmative evaluation of tax positions taken or expected to be taken in the course of preparing the Fund’s tax returns to determine whether it is more-likely-than-not (i.e., greater than 50 percent) that each tax position will be sustained upon examination by a taxing
In September 2006, the FASB issued Statement on Financial Accounting Standards (“SFAS”) No. 157, “Fair Value Measurements.” This standard establishes a single authoritative definition of fair value, sets out a framework for measuring fair value and requires additional disclosures about fair value measurements. SFAS No. 157 applies to fair value measurements already required or permitted by existing standards. SFAS No. 157 is effective for financial statements issued for fiscal years beginning after November 15, 2007 and interim periods within those fiscal years. The changes to current accounting principles generally accepted in the United States of America from the application of this Statement relate to the definition of fair value, the methods used to measure fair value, and the expanded disclosures about fair value measurements. As of June 30, 2007, the Fund does not believe the adoption of SFAS No. 157 will impact the financial statement amounts; however, additional disclosures may be required about the inputs used to develop the measurements and the effect of certain of the measurements on changes in net assets for the period.
Trustees who are not Interested Persons (as defined in the 1940 Act) and Officers of the Trust as of
Number of Portfolios | ||||||||||
Position(s) Held | in the | |||||||||
with the Trust | Principal Occupation(s) | Nationwide Fund | Other | |||||||
Name, Address | and Length of | During Past | Complex Overseen | Directorships | ||||||
and Year of Birth | Time Served1 | Five Years | by Trustee | Held by Trustee2 | ||||||
Charles E. Allen c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1948 | Trustee since July 2000 | Mr. Allen is Chairman, Chief Executive Officer and President of Graimark Realty Advisors, Inc. (real estate development, investment and asset management). | 89 | None | ||||||
Paula H.J. Cholmondeley c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1947 | Trustee since July 2000 | Ms. Cholmondeley was Vice President and General Manager of Sappi Fine Paper North America from April 2000 through December 2003. | 89 | Director of Dentsply International, Inc. (dental products), Ultralife Batteries, Inc., Terex Corporation (construction equipment), Minerals Technology, Inc. (specialty chemicals) and Albany International Corp. (paper industry) | ||||||
C. Brent DeVore3 c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1940 | Trustee since 1990 | Dr. DeVore is President of Otterbein College. | 89 | None | ||||||
Phyllis Kay Dryden c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1947 | Trustee since December 2004 | Ms. Dryden was a partner of Mitchell Madison, a management consulting company from January 2006 until December 2006; she is currently a consultant with the company. Ms. Dryden was formerly Managing Partner of march FIRST, a global management consulting firm. | 89 | None | ||||||
Barbara L. Hennigar c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1935 | Trustee since July 2000 | Retired. | 89 | None | ||||||
Number of Portfolios | ||||||||||
Position(s) Held | in the | |||||||||
with the Trust | Principal Occupation(s) | Nationwide Fund | Other | |||||||
Name, Address | and Length of | During Past | Complex Overseen | Directorships | ||||||
and Year of Birth | Time Served1 | Five Years | by Trustee | Held by Trustee2 | ||||||
Barbara I. Jacobs c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1950 | Trustee since December 2004 | Ms. Jacobs served as Chairman of the Board of Directors of KICAP Network Fund, a European (United Kingdom) hedge fund, from January 2001 through January 2006. From 1998-2003, Ms. Jacobs was also a Managing Director and European Portfolio Manager of CREF Investments (Teachers Insurance and Annuity Association-College Retirement Equities Fund). | 89 | None | ||||||
Douglas F. Kridler c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1955 | Trustee since September 1997 | Mr. Kridler has served as the President and Chief Executive Officer of the Columbus Foundation (a Columbus, OH-based foundation which manages over 1,300 individual endowment funds) since February 2002. Prior to January 31, 2002, Mr. Kridler was the President of the Columbus Association for the Performing Arts and Chairman of the Greater Columbus Convention and Visitors Bureau. | 89 | None | ||||||
Michael D. McCarthy c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1947 | Trustee since December 2004 | Retired. Mr. McCarthy was Chairman of VMAC (commodity swaps) from October 2002 until January 2007; and a partner of Pineville Properties LLC (a commercial real estate development firm) from September 2000 until January 2007. | 89 | None | ||||||
David C. Wetmore c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1948 | Trustee since 1995 and Chairman since February 2005 | Retired. | 89 | None | ||||||
1 | Length of time served includes time served with the Trust’s predecessors. | |
2 | Directorships held in (1) any other investment companies registered under the 1940 Act, (2) any company with a class of securities registered pursuant to Section 12 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or (3) any company subject to the requirements of Section 15(d) of the Exchange Act. | |
3 | Mr. DeVore has served as President of Otterbein College since 1984. Mark Thresher, President and Chief Operating Officer of Nationwide Financial Services, Inc. (“NFS”) has served as a member of the Board of Trustees of Otterbein College since 2000, currently serves as one of 30 of its trustees, and is currently one of two Vice Chairmen of the Board. Each of Nationwide Fund Advisors (“NFA”), the Funds’ investment adviser, and Nationwide Fund Distributors LLC (“NFD”), principal underwriter to the Trust, is a wholly-owned subsidiary of NFS. | |
Additional information regarding the Trustees and Officers may be found in the Trust’s Statement of Additional Information, which is available without charge upon request, by calling 800-848-0920. |
Trustees who are Interested Persons (as defined in the 1940 Act) and/or Officers of the Trust as of
Number of Portfolios | ||||||||||
Position(s) Held | in the | |||||||||
with the Trust | Principal Occupation(s) | Nationwide Fund | Other | |||||||
Name, Address | and Length of | During Past | Complex Overseen | Directorships | ||||||
and Year of Birth | Time Served1 | 5 Years | by Trustee | Held by Trustee 2 | ||||||
Arden L. Shisler c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1941 | Trustee since February 2000 | Retired. Mr. Shisler is the former President and Chief Executive Officer of KeB Transport, Inc., a trucking firm (2000 through 2002). He served as a consultant to KeB from January 2003 through December 2004. Since 1992, Mr. Shisler has also been Chairman of the Board for Nationwide Mutual Insurance Company.3 | 89 | Director of Nationwide Financial Services, Inc., Chairman of Nationwide Mutual Insurance Company3 | ||||||
John H. Grady Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1961 | President & Chief Executive Officer since December 2006 | Mr. Grady is President, and Chief Executive Officer of Nationwide Funds Group which includes Nationwide Fund Advisors,3 Nationwide Fund Management LLC,3 Nationwide Fund Distributors LLC 3 and NWD Investments,2 the asset management operations of Nationwide Mutual Insurance Company, which includes Morley Capital Management, Inc.,2 Nationwide Separate Accounts LLC,2 NorthPointe Capital LLC,2 and Nationwide SA Capital Trust2. From March 2004 until March 2006, Mr. Grady was Chief Executive Officer of Constellation Investment Management Co., L.P. (registered investment adviser), and President and Chief Executive Officer of Constellation Funds Group (registered investment companies). He also was President of Constellation Investment Distribution Co., Inc. (registered broker-dealer) from March 2004 until June 2006. From February 2001 until February 2004, Mr. Grady was Chief Operating and Chief Legal Officer; Managing Director, Mutual Funds Group, Turner Investment Partners, Inc. (registered investment adviser); Executive Vice President of Turner Funds and Turner Institutional Portfolios (registered investment companies); and President, Turner Investment Distributors, Inc. (registered broker-dealer). | N/A | None | ||||||
Gerald J. Holland Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1951 | Treasurer since March 2001 | Mr. Holland is Senior Vice President—Operations for Nationwide Funds Group3. | N/A | N/A | ||||||
Number of Portfolios | ||||||||||
Position(s) Held | in the | |||||||||
with the Trust | Principal Occupation(s) | Nationwide Fund | Other | |||||||
Name, Address | and Length of | During Past | Complex Overseen | Directorships | ||||||
and Year of Birth | Time Served1 | 5 Years | by Trustee | Held by Trustee 2 | ||||||
Michael A. Krulikowski Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1959 | Chief Compliance Officer from June 2004 to August 20074 | Mr. Krulikowski is Vice President and Chief Compliance Officer of Nationwide Funds Group3, Morley Capital Management, Inc.3, Nationwide SA Capital Trust (since 1999)3, and Nationwide Separate Accounts LLC (since August 2005).3 Since June 2004, Mr. Krulikowski has also served as Chief Compliance Officer of the Trust. From November 1999 through May 2007, he served as Vice President and Chief Compliance Officer of NorthPointe Capital LLC. 3 | N/A | N/A | ||||||
Eric E. Miller Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1953 | Secretary since December 2002 | Mr. Miller is Senior Vice President, General Counsel, and Assistant Secretary for Nationwide Funds Group3 and NWD Investments.2 From August 2000 to August 2002, Mr. Miller was a Partner with Stradley Ronon Stevens & Young, LLP. | N/A | N/A | ||||||
1 | Length of time served includes time served with the Trust’s predecessors. | |
2 | Directorships held in (1) any other investment companies registered under the 1940 Act, (2) any company with a class of securities registered pursuant to Section 12 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or (3) any company subject to the requirements of Section 15(d) of the Exchange Act. | |
3 | This position is held with an affiliated person or principal underwriter of the Trust. | |
4 | Effective August 3, 2007, the Board of Trustees approved Carol Baldwin Moody as Chief Compliance Officer of the Trust. Since November 2005, Ms. Moody has been Senior Vice President, Chief Compliance Officer of Nationwide Financial Services, Nationwide Life Insurance Company, Nationwide Life and Annuity Insurance Company, and Nationwide Investment Advisors, LLC. From February 2004-November 2005, she was Chief Compliance Officer of TIAA-CREF and from April 2000-February 2004, she was Managing Director and General Counsel, TCW/ Latin America Partners, LLC and Baeza & Co., LLC. | |
Federal law requires the Trust, each of its investment advisers and sub-advisers to adopt procedures for voting proxies (“Proxy Voting Guidelines”) and to provide a summary of those Proxy Voting Guidelines used to vote the securities held by the Funds. The Funds’ proxy voting policies and procedures are available without charge (i) upon request, by calling 800-848-0920, (ii) on the Funds’ website at www.nationwidefunds.com, or (iii) on the Securities and Exchange Commission’s website at www.sec.gov. |
A. Renewal of Investment Advisory Agreement
(i) | General Information Regarding the Board’s Review of Investment Advisory Agreements |
The Trust’s investment advisory agreements (each an “Advisory Agreement”) with its investment adviser and, as applicable, sub-advisers (together, the “Adviser”) must be approved for an initial term no greater than two years, and renewed at least annually thereafter, (i) by the vote of the Trustees or by a vote of the shareholders of each series or fund of the Trust (individually a “Fund” ), and (ii) by the vote of a majority of the Trustees who are not parties to the Advisory Agreement or “interested persons” of any party thereto (the “Independent Trustees”) cast in person at a meeting called for the purpose of voting on such approval.
The Board meets quarterly and takes into account throughout the year matters bearing on each Fund’s Advisory Agreement. The Board and its standing committees consider at each meeting factors that are relevant to the annual renewal of an Advisory Agreement, including the services and support provided to a Fund and its shareholders.
On December 6, 2006, the Independent Trustees first met in person with their independent legal counsel (“Independent Legal Counsel”) to consider information provided by the Adviser and others to assist the Trustees in considering whether to renew each Fund’s Advisory Agreement for a one year term beginning May 1, 2007. Immediately following such meeting of the Independent Trustees, all Trustees met in person with the Adviser, Trust counsel, Independent Legal Counsel and others to consider such matters, and give preliminary consideration to information bearing on continuation of each Advisory Agreement. The primary purpose of the December 6 and 7, 2006 meeting was to ensure that the Trustees had ample opportunity to consider matters they deemed relevant in considering the continuation of an Advisory Agreement, and to request any additional information they considered reasonably necessary to their deliberations.
In preparation for the December 6 and 7, 2006 meeting the Trustees were provided, at the request of the Trustees, with a wide range of information to assist in their deliberations, including (i) reports from Lipper Inc. describing a Fund’s (a) performance rankings (where “first quintile” denotes the best performance) (over multiple years ended September 30, 2006) compared with performance groups and performance universes created by Lipper (and in some cases, customized peer groups created by the Adviser) of similar or peer group funds, and (b) expense rankings (where “first quintile” denotes the lowest fees and expenses) comparing the Fund’s contractual advisory fee and total expenses with expense groups and expense universes created by Lipper of similar or peer group funds, (ii) information from the Adviser describing the Fund’s performance (over multiple years ended September 30, 2006) compared with its benchmark and Lipper categories, (iii) for Funds under “close review,” copies of letters from the Adviser to the portfolio manager of each such Fund, together with the portfolio manager’s written response describing the reasons for the Fund’s underperformance (iv) information from the Adviser describing performance for the months of October and November, 2006, and annual performance for the year ended November 30, 2006, (v) reports from the Adviser describing the Adviser’s profitability in providing services under an Advisory Agreement, together with an explanation of Adviser’s methodology in calculating its profitability, (vi) information from the Adviser describing any fees paid to the Adviser for managing similar, non-affiliated institutional accounts, including the range of fee levels for such accounts, and (vii) information from the Adviser describing ancillary benefits, in addition to fees for serving as investment adviser, derived by the Adviser as a result of being investment adviser for a Fund, including, where applicable, information on soft-dollar benefits and fees inuring to the Adviser’s affiliates for serving as the Trust’s administrator, fund accountant and transfer agent.
At the December 6 and 7, 2006 meeting, the Trustees reviewed, considered and discussed, among themselves and with the Adviser, Trust counsel and Independent Legal Counsel, among other things, the information described above, and: (i) the nature, extent and quality of services provided by the Adviser under each Advisory Agreement, (ii) the investment performance of each Fund and the Adviser, (iii) the costs of the services provided by the Adviser under the Advisory Agreement and the profits realized by the Adviser thereunder, (iv) the extent to which economies of scale may be present and, if so, whether they are being shared with a Fund’s shareholders, (v) comparisons of the Adviser’s fees under the Advisory Agreement with investment advisory fees paid by peer group funds to their investment advisers and paid by non-affiliated institutional clients to the Adviser for managing similar accounts, and (vi) any ancillary benefits inuring to the Adviser and its affiliates as a result of being investment adviser for the Trust. The Trustees also considered, where
As part of the December 6 and 7, 2006 Board meeting, the Independent Trustees developed a list of follow-up matters and questions and asked that Adviser respond to such matters and questions at the contract approval meeting of the Board of Trustees to be held on January 11, 2007.
At the January 11, 2007 meeting of the Board of Trustees of the Trust, the Board received and considered information provided by the Adviser in follow-up from the December 6 and 7, 2006 Board meeting and, after consulting among themselves, and with the Adviser, Trust counsel and Independent Legal Counsel, concluded unanimously to renew the Advisory Agreement for the reasons set forth in the following section. In determining whether to renew the Advisory Agreement for the Fund, the Board ultimately reached a determination, with the assistance of Trust counsel and Independent Legal Counsel, that the renewal of the Advisory Agreement and the compensation to be received by the Adviser under the Advisory Agreement is consistent with the Board’s fiduciary duty under applicable law.
(ii) | Board Conclusions Regarding the Fund’s Advisory Agreement |
The Board considered that the Fund had outperformed its benchmark, the S&P 500 Index, for the one-, three-, and five-year periods. The Board also considered that the performance of the Fund’s Class I shares ranked in the second quintile of the Fund’s Lipper-constructed Performance Group over the one-year period, the fourth quintile over the two- and three-year periods, and the first quintile over the four-year period. The Board also considered that: (i) although the Fund’s two- and three-year performance has been disappointing, longer-term performance has been consistent with the subadviser’s deep value style; (ii) the Fund has performed as a defensive fund, as it is intended to perform; and (iii) the Fund continues to attract assets. Based on its review, the Board concluded that the nature, extent, and quality of the services provided to the Fund will benefit the Fund’s shareholders.
The Board also considered that the Fund’s contractual advisory fee and breakpoints placed the Fund in the third quintile of its Lipper-constructed Expense Group and the Fund’s total expenses placed the Fund in the first quintile. Based on its review, the Board concluded that the Fund’s management fee and total expenses were fair and reasonable in light of the services that the Fund receives and the other factors considered.
The Board considered that the Fund’s adviser reported a pre-tax profit margin for investment management services during each of the twelve month-periods ended September 30, 2006 and 2005. The Board considered the costs of the services provided by and the profits realized by the Fund’s adviser in connection with the operation of the Fund and determined that the amount of profit is a fair entrepreneurial profit for the management of the Fund.
Based upon its evaluation of all of the conclusions noted above, and after considering all material factors with respect to the Fund, the Board ultimately concluded that the advisory fee structure is fair and reasonable, and that the Advisory Agreement (and, if applicable, Sub-Advisory Agreement) with respect to the Fund, should be renewed.
B. Approval of New Advisory Agreement
At its January 11, 2007 meeting, the Board also unanimously approved a new investment advisory agreement (the “New Agreement”) for the Fund with Nationwide Fund Advisors, (“NFA”) the then-current adviser to each of the series of the Trust to become effective upon the closing of the acquisition of NFA by Nationwide Financial Services, Inc. (“NFS”) from Nationwide Corporation (“NWC”) which closed on April 30, 2007 (the “Transaction”). In approving the New Agreement, the Board considered NFA’s capacity to continue to provide the services needed to operate a sophisticated investment management business and to support the management of each of the series. The Board also took into account the information provided to them at their regular quarterly meetings with NFA’s senior management with respect to the Fund, including the information provided by management at the Fund’s annual Section 15(c) meetings on December 6-7, 2006 and January 11, 2007. In addition, the Board also considered NFS’ announced intentions, over
C. Submission of Matters to a Vote of Security Holders:
On April 25, 2007, a Special Meeting of Shareholders was held* (the “April 25 Meeting”) at which shareholders of the Funds** set forth below were asked:
Proposal 1:
To approve a new investment advisory agreement, on behalf of their Fund, between Nationwide Fund Advisors (formerly “Gartmore Mutual Fund Capital Trust”) (the “Adviser”) and Nationwide Variable Insurance Trust (formerly “Gartmore Variable Insurance Trust”) (the “Trust”).
Number of Shares | ||||||||||
Fund | Cast/Not Cast | Percentages | ||||||||
Federated NVIT High Income Bond Fund | FOR | 30,051,703.188 shares | 92.514% | |||||||
(Formerly Federated GVIT | AGAINST | 618,245.021 shares | 1.903% | |||||||
High Income Bond Fund) | ABSTAIN | 1,813,550.431 shares | 5.583% | |||||||
TOTAL | 32,483,498.640 shares | |||||||||
NVIT International Index Fund | FOR | 4,322,203.982 shares | 96.897% | |||||||
(Formerly GVIT International | AGAINST | 2,758.318 shares | 0.062% | |||||||
Index Fund) | ABSTAIN | 135,636.840 shares | 3.041% | |||||||
TOTAL | 4,460,599.140 shares | |||||||||
NVIT International Value Fund | FOR | 20,032,843.199 shares | 93.351% | |||||||
(Formerly GVIT International | AGAINST | 333,588.902 shares | 1.554% | |||||||
Value Fund) | ABSTAIN | 1,093,293.879 shares | 5.095% | |||||||
TOTAL | 21,459,725.980 shares | |||||||||
NVIT Mid Cap Index Fund | FOR | 35,380,179.120 shares | 94.154% | |||||||
(Formerly GVIT Mid Cap Index Fund) | AGAINST | 631,117.844 shares | 1.679% | |||||||
ABSTAIN | 1,565,714.306 shares | 4.167% | ||||||||
TOTAL | 37,577,011.270 shares | |||||||||
NVIT S&P 500 Index Fund | FOR | 56,119,814.230 shares | 95.554% | |||||||
(Formerly GVIT S&P 500 Index Fund) | AGAINST | 666,195.542 shares | 1.134% | |||||||
ABSTAIN | 1,944,898.888 shares | 3.312% | ||||||||
TOTAL | 58,730,908.660 shares |
Number of Shares | ||||||||||
Fund | Cast/Not Cast | Percentages | ||||||||
Nationwide Multi-Manager NVIT | FOR | 7,632,918.513 shares | 92.700% | |||||||
Small Cap Growth Fund | AGAINST | 149,458.111 shares | 1.816% | |||||||
(Formerly GVIT Small Cap | ABSTAIN | 451,583.036 shares | 5.484% | |||||||
Growth Fund) | TOTAL | 8,233,959.660 shares | ||||||||
Nationwide Multi-Manager NVIT | FOR | 48,649,396.525 shares | 92.816% | |||||||
Small Cap Value Fund | AGAINST | 979,183.753 shares | 1.868% | |||||||
(Formerly GVIT Small Cap | ABSTAIN | 2,786,133.102 shares | 5.316% | |||||||
Value Fund) | TOTAL | 52,414,713.380 shares | ||||||||
Nationwide Multi-Manager NVIT | FOR | 29,903,181.700 shares | 91.311% | |||||||
Small Company Fund | AGAINST | 838,774.923 shares | 2.561% | |||||||
(Formerly GVIT Small Company Fund) | ABSTAIN | 2,006,741.307 shares | 6.128% | |||||||
TOTAL | 32,748,697.930 shares | |||||||||
Gartmore NVIT Developing | FOR | 21,0177,889.443 shares | 91.460% | |||||||
Markets Fund | AGAINST | 424,272.958 shares | 1.841% | |||||||
(Formerly Gartmore GVIT | ABSTAIN | 1,543,850.729 shares | 6.699% | |||||||
Developing Markets Fund) | TOTAL | 23,046,013.130 shares | ||||||||
Gartmore NVIT Emerging | FOR | 17,050,534.593 shares | 92.371% | |||||||
Markets Fund | AGAINST | 526,574.722 shares | 2.853% | |||||||
(Formerly Gartmore GVIT | ABSTAIN | 881,608.905 shares | 4.776% | |||||||
Emerging Markets Fund) | TOTAL | 18,458,718.220 shares | ||||||||
Nationwide NVIT Global | FOR | 1,554,847.333 shares | 95.589% | |||||||
Financial Services Fund | AGAINST | 19,539.033 shares | 1.201% | |||||||
(Formerly Gartmore GVIT | ABSTAIN | 52,206.494 shares | 3.210% | |||||||
Global Financial Services Fund) | TOTAL | 1,626,592.860 shares | ||||||||
Nationwide NVIT Global Health | FOR | 4,722,963.678 shares | 92.815% | |||||||
Sciences Fund | AGAINST | 157,979.030 shares | 3.104% | |||||||
(Formerly Gartmore GVIT | ABSTAIN | 207,642.222 shares | 4.081% | |||||||
Global Health Sciences Fund) | TOTAL | 5,088,584.930 shares | ||||||||
Nationwide NVIT Global Technology | FOR | 8,585,472.039 shares | 93.551% | |||||||
and Communications Fund | AGAINST | 102,267.977 shares | 1.114% | |||||||
(Formerly Gartmore GVIT | ABSTAIN | 489,577.634 shares | 5.335% | |||||||
Global Technology and Communications Fund) | TOTAL | 9,177,317.650 shares | ||||||||
Gartmore NVIT Global | FOR | 4,123,270.549 shares | 91.923% | |||||||
Utilities Fund | AGAINST | 122,001.533 shares | 2.720% | |||||||
(Formerly Gartmore GVIT | ABSTAIN | 240,276.088 shares | 5.357% | |||||||
Global Utilities Fund) | TOTAL | 4,485,548.170 shares | ||||||||
Nationwide NVIT Government | FOR | 88,471,567.462 shares | 92.024% | |||||||
Bond Fund | AGAINST | 1,825,645.181 shares | 1.899% | |||||||
(Formerly Gartmore GVIT | ABSTAIN | 5,841,990.727 shares | 6.077% | |||||||
Government Bond Fund) | TOTAL | 96,139,203.370 shares | ||||||||
Nationwide NVIT Growth Fund | FOR | 14,931,435.904 shares | 89.942% | |||||||
(Formerly Gartmore GVIT | AGAINST | 409,826.402 shares | 2.469% | |||||||
Growth Fund) | ABSTAIN | 1,259,945.064 shares | 7.589% | |||||||
TOTAL | 16,601,207.370 shares |
Number of Shares | ||||||||||
Fund | Cast/Not Cast | Percentages | ||||||||
Gartmore NVIT International | FOR | 6,251,419.070 shares | 93.569% | |||||||
Growth Fund | AGAINST | 139,618.548 shares | 2.090% | |||||||
(Formerly Gartmore GVIT | ABSTAIN | 290,025.592 shares | 4.341% | |||||||
International Growth Fund) | TOTAL | 6,681,063.210 shares | ||||||||
Nationwide NVIT Investor | FOR | 49,489,224.549 shares | 90.688% | |||||||
Destinations Aggressive Fund | AGAINST | 1,385,396.474 shares | 2.539% | |||||||
(Formerly Gartmore GVIT | ABSTAIN | 3,696,272.337 shares | 6.773% | |||||||
Investor Destinations Aggressive Fund) | TOTAL | 54,570,893.360 shares | ||||||||
Nationwide NVIT Investor | FOR | 23,091,965.887 shares | 89.855% | |||||||
Destinations Conservative Fund | AGAINST | 314,935,884 shares | 1.225% | |||||||
(Formerly Gartmore GVIT | ABSTAIN | 2,292,355.179 shares | 8.920% | |||||||
Investor Destinations Conservative Fund) | TOTAL | 25,699,256.950 shares | ||||||||
Nationwide NVIT Investor | FOR | 188,902,093.059 shares | 90.696% | |||||||
Destinations Moderate Fund | AGAINST | 3,018,924.590 shares | 1.449% | |||||||
(Formerly Gartmore GVIT | ABSTAIN | 16,359,690.401 shares | 7.855% | |||||||
Investor Destinations Moderate Fund) | TOTAL | 208,280,708.050 shares | ||||||||
Nationwide NVIT Investor | FOR | 134,792,622.920 shares | 91.332% | |||||||
Destinations Moderately Aggressive Fund | AGAINST | 3,489,207.264 shares | 2.364% | |||||||
(Formerly Gartmore GVIT Investor Destinations | ABSTAIN | 9,304,197.656 shares | 6.304% | |||||||
Moderately Aggressive Fund) | TOTAL | 147,586,027.840 shares | ||||||||
Nationwide NVIT Investor | FOR | 49,627,123.216 shares | 91.918% | |||||||
Destinations Moderately Conservative Fund | AGAINST | 856,088.634 shares | 1.586% | |||||||
(Formerly Gartmore GVIT Investor Destinations | ABSTAIN | 3,507,215.650 shares | 6.496% | |||||||
Moderately Conservative Fund) | TOTAL | 53,990,427.500 shares | ||||||||
Nationwide NVIT Mid Cap | FOR | 10,879,584.971 shares | 91.043% | |||||||
Growth Fund | AGAINST | 352,594.958 shares | 2.950% | |||||||
(Formerly Gartmore GVIT Mid | ABSTAIN | 717,792.971 shares | 6.007% | |||||||
Cap Growth Fund) | TOTAL | 11,949,972.900 shares | ||||||||
Nationwide NVIT Money Market | FOR | 221,774,863.241 shares | 88.508% | |||||||
Fund II | AGAINST | 12,322,482.494 shares | 4.918% | |||||||
(Formerly Gartmore GVIT Money | ABSTAIN | 16,471,740.875 shares | 6.574% | |||||||
Market Fund II) | TOTAL | 250,569,086.610 shares | ||||||||
Nationwide NVIT Money Market | FOR | 1,578,331,008.328 shares | 91.585% | |||||||
Fund | AGAINST | 32,372,133.671 shares | 1.878% | |||||||
(Formerly Gartmore GVIT Money | ABSTAIN | 112,652,123.301 shares | 6.537% | |||||||
Market Fund) | TOTAL | 1,723,355,265.300 shares | ||||||||
NVIT Nationwide Fund | FOR | 125,423,274.735 shares | 91.581% | |||||||
(Formerly Gartmore GVIT | AGAINST | 2,767,979.467 shares | 2.021% | |||||||
Nationwide Fund) | ABSTAIN | 8,762,255.828 shares | 6.398% | |||||||
TOTAL | 136,953,510.030 shares | |||||||||
NVIT Nationwide Leaders Fund | FOR | 2,298,504.956 shares | 95.780% | |||||||
(Formerly Gartmore GVIT | AGAINST | 29,630.469 shares | 1.235% | |||||||
Nationwide Leaders Fund) | ABSTAIN | 71,637.755 shares | 2.985% | |||||||
TOTAL | 2,399,773.180 shares |
Number of Shares | ||||||||||
Fund | Cast/Not Cast | Percentages | ||||||||
Nationwide NVIT U.S. Growth | FOR | 4,972,094.773 shares | 94.359% | |||||||
Leaders Fund | AGAINST | 122,623.161 shares | 2.327% | |||||||
(Formerly Gartmore GVIT U.S. | ABSTAIN | 174,625.606 shares | 3.314% | |||||||
Growth Leaders Fund) | TOTAL | 5,269,343.540 shares | ||||||||
Gartmore NVIT Worldwide | FOR | 2,666,862.487 shares | 94.126% | |||||||
Leaders Fund | AGAINST | 47,702.491 shares | 1.684% | |||||||
(Formerly Gartmore GVIT | ABSTAIN | 118,719.882 shares | 4.190% | |||||||
Worldwide Leaders Fund) | TOTAL | 2,833,284.860 shares | ||||||||
J.P. Morgan NVIT Balanced Fund | FOR | 15,966,867.546 shares | 90.900% | |||||||
(Formerly J.P. Morgan GVIT | AGAINST | 259,004.324 shares | 1.475% | |||||||
Balanced Fund) | ABSTAIN | 1,339,385.200 shares | 7.625% | |||||||
TOTAL | 17,565,257.070 shares | |||||||||
Van Kampen NVIT Comstock | FOR | 27,737,008.009 shares | 92.259% | |||||||
Value Fund | AGAINST | 502,564.164 shares | 1.672% | |||||||
(Formerly Van Kampen GVIT | ABSTAIN | 1,824,670.107 shares | 6.069% | |||||||
Comstock Value Fund) | TOTAL | 30,064,242.280 shares | ||||||||
Van Kampen NVIT Multi Sector | FOR | 21,253,297.665 shares | 90.281% | |||||||
Bond Fund | AGAINST | 484,100.920 shares | 2.056% | |||||||
(Formerly Van Kampen GVIT | ABSTAIN | 1,803,963.645 shares | 7.663% | |||||||
Multi Sector Bond Fund) | TOTAL | 23,541,362.230 shares | ||||||||
At the April 25 Meeting, shareholders of the Nationwide NVIT Mid Cap Growth Fund were also asked to approve a new investment subadvisory agreement among the Adviser, the Trust and NorthPointe Capital LLC. The voting results with respect to that proposal are set forth below:
Proposal 2
Number of Shares | ||||||||||
Fund | Cast/Not Cast | Percentages | ||||||||
Nationwide NVIT Mid Cap Growth | FOR | 10,862,827.499 shares | 90.903% | |||||||
Fund | AGAINST | 414,574.660 shares | 3.469% | |||||||
(Formerly Gartmore GVIT Mid | ABSTAIN | 672,570.741 shares | 5.628% | |||||||
Cap Growth Fund) | TOTAL | 11,949,972.900 shares | ||||||||
* | This meeting was previously adjourned on April 23, 2007. | |
** | Fund names were changed effective May 1, 2007 to reflect “Nationwide”/“NVIT” branding to coincide with the sale of Nationwide Fund Advisors, Inc. by Nationwide Corporation to its majority-owned subsidiary, Nationwide Financial Services, Inc. |
June 30, 2007 (Unaudited)
Contents | ||
6 | Statement of Investments | |
8 | Statement of Assets and Liabilities | |
9 | Statement of Operations | |
10 | Statements of Changes in Net Assets | |
12 | Financial Highlights | |
13 | Notes to Financial Statements |
Statement Regarding Availability of Proxy Voting Record.
SAR-WWL (8/07) | ![]() |
Dear Fellow Shareholder:
Since I last wrote to you, our mutual funds have enjoyed another period of solid performance, and the corporate realignment that was in progress is now finished.
On May 1, 2007, Nationwide Financial Services, Inc. (NFS), completed its acquisition of the Philadelphia-based retail mutual fund operations of NWD Investment Management, Inc. (formerly, “Gartmore Global Investments, Inc.”), from Nationwide Corporation, a subsidiary of Nationwide Mutual Insurance Company. Effective that date, the acquired entities were renamed Nationwide Funds Group (NFG), and the Gartmore Funds were renamed the Nationwide Funds to better align with the Nationwide® brand. Although the corporate ownership and fund names have changed, I can assure you that NFG intends to maintain as much continuity as possible with the Funds and key personnel.
Thank you, shareholders, for approving the new investment advisory agreement that was required due to the change in corporate ownership. The new agreement is identical in all material respects to the original agreement that it replaces, with the exception of the section pertaining to the vote by the shareholders of the NVIT Mid Cap Growth Fund to approve NorthPointe Capital®, LLC (NorthPointe) as sub-adviser to that particular Fund.
Market Overview: January 1-June 30, 2007
Share prices in general were buoyed in part by better-than-expected first-quarter 2007 earnings and a flurry of mergers and acquisitions, many of these spurred by readily available funding from private equity firms. In June, investors grew more cautious amid surging crude oil prices, a sudden spike in long-term interest rates, and the meltdown of two hedge funds that had exposure to the subprime mortgage market. Looking abroad, a weak U.S. dollar aided foreign stocks, as reflected in the 11.09% advance of the Morgan Stanley Capital International Europe, Australasia and Far East (MSCI EAFE®) Index. Emerging market performance was particularly robust.
The bond market struggled during the first half of 2007. While short-term interest rates remained stable, reflecting the Federal Reserve Board’s decision in June to leave the target federal funds rate at 5.25%, longer-term rates climbed during the first half of 2007, depressing bond prices and forcing the Lehman Brothers® U.S. Aggregate Index to settle for a modest 0.97% return.
We at NFG thank you for your understanding and cooperation throughout our recent transition period. We emerge from this period energized for the future, and we look forward to serving your investment needs for a long time to come.
Nationwide Funds Group
PAST PERFORMANCE IS NO GUARANTEE OF FUTURE RESULTS.
Nationwide Funds are advised by Nationwide Fund Advisors (NFA). NFA is a wholly-owned subsidiary of Nationwide Financial Services. Nationwide Financial Services is a wholly-owned subsidiary of Nationwide Corporation. All of the common stock of Nationwide Corporation is held by Nationwide Mutual (95.2%) and Nationwide Mutual Fire Insurance Company (4.8%), each of which is a mutual company owned by its policyholders.
Nationwide Funds Group (NFG) is the mutual fund arm of Nationwide Financial Services (NYSE: NFS). Based in Conshohocken, Pa., a suburb of Philadelphia, NFG is comprised of Nationwide Fund Advisors, Nationwide Fund Distributors, LLC, and Nationwide Fund Management, LLC. Together, these provide advisory, distribution, and administration services respectively to the Nationwide Funds, and manage more than $43.5 billion in assets as of June 30, 2007, of which more than $12 billion are in “fund of funds” designed to provide asset allocation across several types of investments and asset classes.
Lehman Brothers (LB) U.S. Aggregate Index: An unmanaged, market value-weighted index of investment-grade, fixed-rate debt issues (including government, corporate, asset-backed, and mortgage-backed securities with maturities of one year or more) that is generally representative of the bond market as a whole.
Morgan Stanley Capital International Europe, Australasia and Far East (MSCI EAFE®) Index: An unmanaged, free float-adjusted, market capitalization-weighted index that is designed to measure the performance of stocks in developed markets outside the United States and Canada.
Standard & Poor’s 500® (S&P 500) Index: An unmanaged, market capitalization-weighted index of 500 widely held stocks of large-cap U.S. companies that gives a broad look at how the stock prices of those companies have performed.
Views expressed within are those of Nationwide Funds Group as of the date noted, are subject to change at any time, and may not come to pass.
This report is for informational purposes only, and is not intended as an offer or recommendation with respect to the purchase or sale of any security, option, future, or other derivatives in such securities.
Investing in mutual funds involves risk, including possible loss of principal.
Investors should carefully consider a fund’s investment objectives, risks, fees, charges, and expenses before investing any money. To obtain this and other fund information, please call 800-848-0920 to request a prospectus, or download a prospectus at www.nationwidefunds.com. Please read the prospectus carefully before investing any money.
Nationwide Funds distributed by Nationwide Fund Distributors LLC (formerly Gartmore Distribution Services, Inc.), Member NASD. 1200 River Road, Suite 1000, Conshohocken, Pa. 19428.
As a shareholder of the Fund, you incur two types of costs: (1) transaction costs, including sales charges (loads) paid on purchase payments and redemption fees; and (2) ongoing costs, including investment advisory fees, administration fees, distribution fees and other Fund expenses. The examples below are 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. Per SEC requirements, the examples assume that you had a $1,000 investment in the Class at the beginning of the reporting period, January 1, 2007, and continued to hold your shares at the end of the reporting period, June 30, 2007.
Actual Expenses
Hypothetical Example for Comparison Purposes
Please note that the expenses shown in the table are meant to highlight your ongoing costs only and do not reflect any transaction costs, such as sales charges (loads) or redemption fees. Therefore, the second line for each Class in 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 transaction costs were included, your costs would have been higher. The examples also assume all dividends and distributions have been reinvested.
Schedule of Shareholder Expenses
Gartmore NVIT Worldwide Leaders Fund | ||||||||||||||||||||||
Ending | ||||||||||||||||||||||
Beginning | Account | |||||||||||||||||||||
Account Value, | Value, | Expenses Paid | Annualized | |||||||||||||||||||
January 1, 2007 | June 30, 2007 | During Period* | Expense Ratio* | |||||||||||||||||||
Class I | Actual | $ | 1,000.00 | $ | 1,123.60 | $ | 6.58 | 1.25% | ||||||||||||||
Hypothetical | 1 | $ | 1,000.00 | $ | 1,018.60 | $ | 6.28 | 1.25% | ||||||||||||||
Class III | Actual | $ | 1,000.00 | $ | 1,123.60 | $ | 6.63 | 1.26% | ||||||||||||||
Hypothetical | 1 | $ | 1,000.00 | $ | 1,018.55 | $ | 6.33 | 1.26% | ||||||||||||||
* | Expenses are equal to the Fund’s annualized expense ratio multiplied by the average account value over the period multiplied by 181/365 (to reflect the one-half year period). The expense ratio presented represents a six-month, annualized ratio in accordance with SEC guidelines. The expenses reported above do not include the effect of additional expenses imposed by variable annuity contracts. | |
1 | Represents the hypothetical 5% return before expenses. |
The SEC adopted a requirement that Funds present their portfolio holdings in a table, chart or graph format in their annual and semiannual reports to shareholders, whether or not a statement of investments is utilized. The following tables, which present portfolio holdings as a percentage of net assets, are provided in compliance with this requirement.
Asset Allocation | ||||
Common Stock | 96.0% | |||
Repurchase Agreements | 1.4% | |||
Other Investments* | 2.3% | |||
Other assets in excess of liabilities** | 0.3% | |||
100.0% |
Top Holdings*** | ||||
BHP Billiton PLC | 4.6% | |||
Apple, Inc. | 4.4% | |||
British Airways | 4.3% | |||
MAN AG | 4.1% | |||
Union Pacific Corp. | 3.9% | |||
Julius Baer Holding Ltd. | 3.7% | |||
FedEx Corp. | 3.5% | |||
Daimler Chrysler AG | 3.5% | |||
McDonald’s Corp. | 3.5% | |||
Societe Generale | 3.4% | |||
Other | 61.1% | |||
100.0% |
Top Industries | ||||
Road & Rail | 6.8% | |||
Computers & Peripherals | 6.9% | |||
Hotels, Restaurants & Leisure | 6.9% | |||
Automobiles | 6.6% | |||
Oil, Gas & Consumable Fuels | 6.6% | |||
Commercial Banks | 6.1% | |||
Diversified Telecommunication Services | 5.3% | |||
Metals & Mining | 4.6% | |||
Airlines | 4.3% | |||
Machinery | 4.1% | |||
Other | 41.8% | |||
100.0% |
Top Countries | ||||
United States | 49.1% | |||
Japan | 12.1% | |||
Germany | 11.6% | |||
United Kingdom | 8.9% | |||
Switzerland | 5.3% | |||
France | 3.4% | |||
China | 2.7% | |||
Australia | 2.0% | |||
Hong Kong | 1.5% | |||
Republic of Korea | 0.8% | |||
Other | 2.6% | |||
100.0% |
* | Includes value of collateral received from securities lending. |
** | Includes value of collateral owed from securities lending. |
*** | For purpose of listing top holdings, repurchase agreements are included as part of Other. |
Gartmore NVIT Worldwide Leaders Fund
Common Stock (96.0%) | ||||||||
Shares or | ||||||||
Principal Amount | Value | |||||||
AUSTRALIA (2.0%) (a) | ||||||||
Diversified Telecommunication Services (2.0%) | ||||||||
Telstra Corp. Ltd. | 469,300 | $ | 1,234,286 | |||||
CHINA (2.7%) (a) | ||||||||
Commercial Bank (2.7%) | ||||||||
China Construction Bank, Class H | 2,479,000 | 1,704,743 | ||||||
FRANCE (3.4%) (a) | ||||||||
Commercial Bank (3.4%) | ||||||||
Societe Generale | 11,600 | 2,148,997 | ||||||
GERMANY (11.6%) (a) | ||||||||
Auto Components (2.4%) | ||||||||
Continental AG | 10,600 | 1,489,554 | ||||||
Automobiles (3.5%) | ||||||||
Daimler Chrysler AG | 23,700 | 2,181,430 | ||||||
Machinery (4.1%) | ||||||||
MAN AG | 17,990 | 2,567,968 | ||||||
Semiconductors & Semiconductor Equipment (1.6%) | ||||||||
Infineon Technologies AG* | 58,100 | 960,224 | ||||||
7,199,176 | ||||||||
HONG KONG (1.5%) (a) | ||||||||
Real Estate Management & Development (1.5%) | ||||||||
New World Development Co. Ltd. | 364,000 | 910,972 | ||||||
JAPAN (12.1%) (a) | ||||||||
Automobiles (3.1%) | ||||||||
Toyota Motor Corp. | 30,800 | 1,942,682 | ||||||
Road & Rail (2.9%) | ||||||||
East Japan Railway Co. | 237 | 1,826,357 | ||||||
Software (2.7%) | ||||||||
Nintendo Co. Ltd. | 4,500 | 1,641,995 | ||||||
Tobacco (3.4%) | ||||||||
Japan Tobacco, Inc. | 432 | 2,129,694 | ||||||
7,540,728 | ||||||||
REPUBLIC OF KOREA (0.8%) (a) | ||||||||
Semiconductors & Semiconductor Equipment (0.8%) | ||||||||
Hynix Semiconductor, Inc.* | 13,700 | 493,081 | ||||||
SWITZERLAND (5.3%) (a) | ||||||||
Capital Markets (3.7%) | ||||||||
Julius Baer Holding Ltd. | 32,100 | 2,297,311 | ||||||
Commercial Services & Supplies (1.6%) | ||||||||
Adecco SA | 12,900 | 998,217 | ||||||
3,295,528 | ||||||||
UNITED KINGDOM (8.9%) (a) | ||||||||
Airline (4.3%) | ||||||||
British Airways PLC* | 321,300 | 2,687,042 | ||||||
Metals & Mining (4.6%) | ||||||||
BHP Billiton PLC | 102,570 | 2,848,990 | ||||||
5,536,032 | ||||||||
UNITED STATES (47.7%) | ||||||||
Aerospace & Defense (3.0%) | ||||||||
Boeing Co. (The) | 19,600 | 1,884,736 | ||||||
Air Freight & Logistics (3.5%) | ||||||||
FedEx Corp. | 19,800 | 2,197,206 | ||||||
Communications Equipment (2.5%) | ||||||||
Cisco Systems, Inc.* | 55,800 | 1,554,030 | ||||||
Computers & Peripherals (6.9%) | ||||||||
Apple, Inc.* | 22,172 | 2,705,871 | ||||||
Hewlett-Packard Co. | 34,800 | 1,552,776 | ||||||
4,258,647 | ||||||||
Diversified Telecommunication Services (3.3%) | ||||||||
AT&T, Inc. | 49,900 | 2,070,850 | ||||||
Energy Equipment & Services (2.4%) | ||||||||
Diamond Offshore Drilling, Inc. | 14,400 | 1,462,464 | ||||||
Food & Staples Retailing (3.1%) | ||||||||
CVS/ Caremark Corp. | 53,300 | 1,942,785 | ||||||
Hotels, Restaurants & Leisure (6.9%) | ||||||||
McDonald’s Corp. | 42,800 | 2,172,528 | ||||||
Starwood Hotels & Resorts Worldwide, Inc. | 31,100 | 2,085,877 | ||||||
4,258,405 | ||||||||
Industrial Conglomerate (3.0%) | ||||||||
General Electric Co. | 48,600 | 1,860,408 | ||||||
Oil, Gas & Consumable Fuels (6.6%) | ||||||||
ConocoPhillips | 26,800 | 2,103,800 | ||||||
Sunoco, Inc. | 25,300 | 2,015,904 | ||||||
4,119,704 | ||||||||
Real Estate Management & Development (2.6%) | ||||||||
CB Richard Ellis Group, Inc., Class A* | 44,900 | 1,638,850 | ||||||
Common Stock (continued) | ||||||||
Shares or | ||||||||
Principal Amount | Value | |||||||
UNITED STATES (continued) | ||||||||
Road & Rail (3.9%) | ||||||||
Union Pacific Corp. | 21,300 | $ | 2,452,695 | |||||
29,700,780 | ||||||||
Total Common Stocks (Cost $55,161,142) | 59,764,323 | |||||||
Repurchase Agreements (1.4%) | ||||||||
Nomura Securities, 5.20% dated 06/29/07, due 07/02/07, repurchase price $854,869, collateralized by U.S. Government Agency Mortgages with a market value of $871,589 | $ | 854,499 | 854,499 | |||||
Securities Held as Collateral for Securities on Loan (2.3%) | ||||||||
Bank of America, 5.42% dated 06/29/07, due 07/02/07, repurchase price $1,416,414, collateralized by U.S. Government Agency Mortgages with a market value of $1,444,095 | 1,415,775 | 1,415,775 | ||||||
Total Investments (Cost $57,431,416) (b) — 99.7% | 62,034,597 | |||||||
Other assets in excess of liabilities — 0.3% | 189,761 | |||||||
NET ASSETS — 100.0% | $ | 62,224,358 | ||||||
* | Denotes a non-income producing security. | |
(a) | Fair Valued Security. | |
(b) | See notes to financial statements for tax unrealized appreciation (depreciation) of securities. |
See accompanying notes to financial statements
Gartmore NVIT | ||||||
Worldwide Leaders | ||||||
Fund | ||||||
Assets: | ||||||
Investments, at value (cost $55,161,142)* | $ | 59,764,323 | ||||
Repurchase agreements, at cost and value | 2,270,274 | |||||
Total Investments | 62,034,597 | |||||
Foreign currencies, at value (cost $33,879) | 33,884 | |||||
Interest and dividends receivable | 120,322 | |||||
Receivable for capital shares issued | 774 | |||||
Receivable for investments sold | 7,537,380 | |||||
Unrealized appreciation on spot contracts | 7,034 | |||||
Reclaims receivable | 1,412 | |||||
Prepaid expenses | 668 | |||||
Total Assets | 69,736,071 | |||||
Liabilities: | ||||||
Payable to custodian | 32,730 | |||||
Payable for investments purchased | 5,806,891 | |||||
Unrealized depreciation on spot contracts | 9,261 | |||||
Payable upon return of securities loaned | 1,415,775 | |||||
Payable for capital shares redeemed | 68,183 | |||||
Accrued expenses and other payables: | ||||||
Investment advisory fees | 154,775 | |||||
Fund administration and transfer agent fees | 4,964 | |||||
Administrative servicing fees | 7,665 | |||||
Compliance program costs | 690 | |||||
Other | 10,779 | |||||
Total Liabilities | 7,511,713 | |||||
Net Assets | $ | 62,224,358 | ||||
Represented by: | ||||||
Capital | $ | 52,659,736 | ||||
Accumulated net investment income | 79,273 | |||||
Accumulated net realized gains from investment transactions and foreign currency transactions | 4,880,758 | |||||
Net unrealized appreciation on investments and translation of assets and liabilities denominated in foreign currencies | 4,604,591 | |||||
Net Assets | $ | 62,224,358 | ||||
Net Assets: | ||||||
Class I Shares | $ | 29,017,471 | ||||
Class III Shares | 33,206,887 | |||||
Total | $ | 62,224,358 | ||||
Shares outstanding (unlimited number of shares authorized): | ||||||
Class I Shares | 1,628,589 | |||||
Class III Shares | 1,864,349 | |||||
Total | 3,492,938 | |||||
Net asset value and offering price per share (Net assets by class divided by shares outstanding by class, respectively.): | ||||||
Class I Shares | $ | 17.82 | ||||
Class III Shares | $ | 17.81 | ||||
* | Includes value of securities on loan of $1,351,680. |
8
Gartmore NVIT | |||||
Worldwide | |||||
Leaders Fund | |||||
INVESTMENT INCOME: | |||||
Interest income | $ | 28,891 | |||
Dividend income | 573,082 | ||||
Income from securities lending | 16,297 | ||||
Total Income | 618,270 | ||||
Expenses: | |||||
Investment advisory fees | 292,407 | ||||
Fund administration and transfer agent fees | 24,896 | ||||
Administrative servicing fees Class I Shares | 19,631 | ||||
Administrative servicing fees Class III Shares | 25,332 | ||||
Custodian fees | 6,090 | ||||
Trustee fees | 1,324 | ||||
Compliance program costs (Note 3) | 403 | ||||
Other | 15,152 | ||||
Total expenses before earnings credit | 385,235 | ||||
Earnings credit (Note 6) | (6 | ) | |||
Net Expenses | 385,229 | ||||
Net Investment Income | 233,041 | ||||
REALIZED/ UNREALIZED GAINS (LOSSES) FROM INVESTMENTS: | |||||
Net realized gains on investment transactions | 9,532,366 | ||||
Net realized losses on foreign currency transactions | (9,169 | ) | |||
Net realized gains on investment transactions and foreign currency transactions | 9,523,197 | ||||
Net change in unrealized depreciation on investments and translation of assets and liabilities denominated in foreign currencies | (2,785,512 | ) | |||
Net realized/unrealized gains (losses) on investments and translation of assets and liabilities denominated in foreign currencies | 6,737,685 | ||||
CHANGE IN NET ASSETS RESULTING FROM OPERATIONS | $ | 6,970,726 | |||
9
Gartmore NVIT | |||||||||
Worldwide Leaders Fund | |||||||||
Six Months Ended | Year Ended | ||||||||
June 30, 2007 | December 31, 2006 | ||||||||
(Unaudited) | |||||||||
FROM INVESTMENT ACTIVITIES: | |||||||||
Operations: | |||||||||
Net investment income | $ | 233,041 | $ | 460,141 | |||||
Net realized gains on investment transactions and foreign currency transactions | 9,523,197 | 7,261,673 | |||||||
Net change in unrealized appreciation/depreciation on investments and translation of assets and liabilities denominated in foreign currencies | (2,785,512 | ) | 3,489,362 | ||||||
Change in net assets resulting from operations | 6,970,726 | 11,211,176 | |||||||
Distributions to shareholders from: | |||||||||
Net investment income: | |||||||||
Class I | (74,277 | ) | (242,111 | ) | |||||
Class III | (84,000 | ) | (177,137 | ) | |||||
Change in net assets from shareholder distributions | (158,277 | ) | (419,248 | ) | |||||
Change in net assets from capital transactions | 2,854,598 | (3,606,433 | ) | ||||||
Change in net assets | 9,667,047 | 7,185,495 | |||||||
Net Assets: | |||||||||
Beginning of period | 52,557,311 | 45,371,816 | |||||||
End of period | $ | 62,224,358 | $ | 52,557,311 | |||||
Accumulated net investment income at end of period | $ | 79,273 | $ | 4,509 | |||||
CAPITAL TRANSACTIONS: | |||||||||
Class I Shares | |||||||||
Proceeds from shares issued | $ | 1,419,278 | $ | 2,329,880 | |||||
Dividends reinvested | 74,275 | 242,111 | |||||||
Cost of shares redeemed (a) | (5,240,042 | ) | (8,715,660 | ) | |||||
(3,746,489 | ) | (6,143,669 | ) | ||||||
Class III Shares | |||||||||
Proceeds from shares issued | 14,543,031 | 9,591,417 | |||||||
Dividends reinvested | 83,998 | 177,137 | |||||||
Cost of shares redeemed (a) | (8,025,942 | ) | (7,231,318 | ) | |||||
6,601,087 | 2,537,236 | ||||||||
Change in net assets from capital transactions | $ | 2,854,598 | $ | (3,606,433 | ) | ||||
10
Gartmore NVIT | |||||||||
Worldwide Leaders Fund | |||||||||
Six Months Ended | Year Ended | ||||||||
June 30, 2007 | December 31, 2006 | ||||||||
(Unaudited) | |||||||||
SHARE TRANSACTIONS: | |||||||||
Class I Shares | |||||||||
Issued | 83,673 | 163,371 | |||||||
Reinvested | 4,212 | 17,224 | |||||||
Redeemed | (308,783 | ) | (622,054 | ) | |||||
(220,898 | ) | (441,459 | ) | ||||||
Class III Shares | |||||||||
Issued | 857,804 | 690,316 | |||||||
Reinvested | 4,778 | 12,550 | |||||||
Redeemed | (455,125 | ) | (518,388 | ) | |||||
407,457 | 184,478 | ||||||||
Total change in shares | 186,559 | (256,981 | ) | ||||||
(a) | Includes redemption fees, if any. |
11
Distributions | ||||||||||||||||||||
Investment Activities | ||||||||||||||||||||
Net Realized | ||||||||||||||||||||
and | ||||||||||||||||||||
Net Asset | Net | Unrealized | Total | |||||||||||||||||
Value, | Investment | Gains | from | Net | ||||||||||||||||
Beginning | Income | (Losses) on | Investment | Investment | ||||||||||||||||
of Period | (Loss) | Investments | Activities | Income | ||||||||||||||||
Class I Shares | ||||||||||||||||||||
For the year ended December 31, 2002 | $ | 9.28 | (0.04 | ) | (2.29 | ) | (2.33 | ) | (0.08 | ) | ||||||||||
For the year ended December 31, 2003 | $ | 6.85 | 0.01 | 2.46 | 2.47 | – | ||||||||||||||
For the year ended December 31, 2004 | $ | 9.32 | 0.09 | 1.37 | 1.46 | – | ||||||||||||||
For the year ended December 31, 2005 | $ | 10.78 | 0.01 | 2.04 | 2.05 | (0.10 | ) | |||||||||||||
For the year ended December 31, 2006 | $ | 12.73 | 0.13 | 3.16 | 3.29 | (0.12 | ) | |||||||||||||
For the six months ended June 30, 2007 (Unaudited) | $ | 15.90 | 0.07 | 1.90 | 1.97 | (0.05 | ) | |||||||||||||
Class III Shares | ||||||||||||||||||||
Period ended December 31, 2003(e) | $ | 6.89 | (0.01 | ) | 2.44 | 2.43 | – | |||||||||||||
For the year ended December 31, 2004 | $ | 9.32 | 0.09 | 1.37 | 1.46 | – | ||||||||||||||
For the year ended December 31, 2005 | $ | 10.78 | 0.01 | 2.04 | 2.05 | (0.10 | ) | |||||||||||||
For the year ended December 31, 2006 | $ | 12.73 | 0.12 | 3.16 | 3.28 | (0.12 | ) | |||||||||||||
For the six months ended June 30, 2007 (Unaudited) | $ | 15.89 | 0.07 | 1.89 | 1.96 | (0.04 | ) | |||||||||||||
[Additional columns below]
[Continued from above table, first column(s) repeated]
Distributions | Ratios/Supplemental Data | |||||||||||||||||||||||
Net Assets | Ratio of | |||||||||||||||||||||||
Tax | Net Asset | at End of | Expenses | |||||||||||||||||||||
Return of | Total | Value, End | Total | Period | to Average | |||||||||||||||||||
Capital | Distributions | of Period | Return (a) | (000s) | Net Assets (b) | |||||||||||||||||||
Class I Shares | ||||||||||||||||||||||||
For the year ended December 31, 2002 | (0.02 | ) | (0.10 | ) | $ | 6.85 | (25.39% | ) | $ | 26,467 | 1.32% | |||||||||||||
For the year ended December 31, 2003 | – | – | $ | 9.32 | 36.06% | $ | 27,624 | 1.32% | ||||||||||||||||
For the year ended December 31, 2004 | – | – | $ | 10.78 | 15.67% | $ | 28,776 | 1.25% | ||||||||||||||||
For the year ended December 31, 2005 | – | (0.10 | ) | $ | 12.73 | 19.34% | $ | 29,173 | 1.29% | |||||||||||||||
For the year ended December 31, 2006 | – | (0.12 | ) | $ | 15.90 | 25.88% | $ | 29,403 | 1.21% | |||||||||||||||
For the six months ended June 30, 2007 (Unaudited) | – | (0.05 | ) | $ | 17.82 | 12.36% | $ | 29,017 | 1.25% | |||||||||||||||
Class III Shares | ||||||||||||||||||||||||
Period ended December 31, 2003(e) | – | – | $ | 9.32 | 35.27% | $ | 5,853 | 1.35% | ||||||||||||||||
For the year ended December 31, 2004 | – | – | $ | 10.78 | 15.67% | $ | 7,376 | 1.25% | ||||||||||||||||
For the year ended December 31, 2005 | – | (0.10 | ) | $ | 12.73 | 19.34% | $ | 16,198 | 1.29% | |||||||||||||||
For the year ended December 31, 2006 | – | (0.12 | ) | $ | 15.89 | 25.81% | $ | 23,155 | 1.20% | |||||||||||||||
For the six months ended June 30, 2007 (Unaudited) | – | (0.04 | ) | $ | 17.81 | 12.36% | $ | 33,207 | 1.26% | |||||||||||||||
[Additional columns below]
[Continued from above table, first column(s) repeated]
Ratios/Supplemental Data | ||||||||||||||||||
Ratio of | ||||||||||||||||||
Ratio of | Ratio of | Net Investment | ||||||||||||||||
Net | Expenses | Income | ||||||||||||||||
Investment | (Prior to | (Prior to | ||||||||||||||||
Income (Loss) | Reimbursements) | Reimbursements) | ||||||||||||||||
to Average | to Average | to Average | Portfolio | |||||||||||||||
Net Assets (b) | Net Assets (b)(c) | Net Assets (b)(c) | Turnover (d) | |||||||||||||||
Class I Shares | ||||||||||||||||||
For the year ended December 31, 2002 | 0.29% | 1.32% | 0.29% | 529.97% | ||||||||||||||
For the year ended December 31, 2003 | 0.30% | (f) | (f) | 603.34% | ||||||||||||||
For the year ended December 31, 2004 | 0.95% | (f) | (f) | 452.01% | ||||||||||||||
For the year ended December 31, 2005 | 0.18% | (f) | (f) | 360.00% | ||||||||||||||
For the year ended December 31, 2006 | 0.96% | (f) | (f) | 269.37% | ||||||||||||||
For the six months ended June 30, 2007 (Unaudited) | 0.70% | 1.25% | 0.70% | 137.48% | ||||||||||||||
Class III Shares | ||||||||||||||||||
Period ended December 31, 2003(e) | (0.31% | ) | (f) | (f) | 603.34% | |||||||||||||
For the year ended December 31, 2004 | 0.94% | (f) | (f) | 452.01% | ||||||||||||||
For the year ended December 31, 2005 | 0.13% | (f) | (f) | 360.00% | ||||||||||||||
For the year ended December 31, 2006 | 0.93% | (f) | (f) | 269.37% | ||||||||||||||
For the six months ended June 30, 2007 (Unaudited) | 0.81% | 1.26% | 0.81% | 137.48% | ||||||||||||||
(a) | Not annualized for periods less than one year. | |
(b) | Annualized for periods less than one year. | |
(c) | During the period, certain fees were waived and/or reimbursed. If such waivers/reimbursements had not occurred, the ratios would have been as indicated. | |
(d) | Portfolio turnover is calculated on the basis of the Fund as a whole without distinguishing among the classes of shares. | |
(e) | For the period from May 2, 2003 (commencement of operations) through December 31, 2003. | |
(f) | There were no fee reductions during the period. |
See accompanying notes to financial statements.
1. Organization
Nationwide Variable Insurance Trust (“NVIT” or the “Trust”) is an open-end management investment company, organized under the laws of Delaware by an amended and restated Agreement and Declaration of Trust, dated October 28, 2004, as amended to date. Prior to May 1, 2007, the Trust was named “Gartmore Variable Insurance Trust”. The Trust, originally created under the laws of Massachusetts as a Massachusetts business trust pursuant to a Declaration of Trust dated, as of June 30, 1981, and as subsequently amended, redomesticated as a Delaware Statutory Trust after the close of trading on April 29, 2005, and is registered under the Investment Company Act of 1940, as amended (the “1940 Act”). The redomestication was a change in statutory status and did not affect the operations of the Trust. As of June 30, 2007, the Trust had authorized an unlimited number of shares of beneficial interest, without par value (“shares”). The Trust currently offers shares to life insurance company separate accounts to fund the benefits under variable life insurance or annuity policies. To date, only the separate accounts of Nationwide Life Insurance Company and Nationwide Life and Annuity Insurance Company (collectively, “Nationwide”) have purchased shares of the Gartmore NVIT Worldwide Leaders Fund (the “Fund”), (formerly, “GVIT Worldwide Leaders Fund”). The Trust currently operates forty (40) separate series, or mutual funds, each with its own investment objectives and strategies. This report contains the financial statements and financial highlights of the Fund.
2. Summary of Significant Accounting Policies
The following is a summary of significant accounting policies followed by the Fund in the preparation of its financial statements. The policies are in conformity with accounting principles generally accepted in the United States of America (“GAAP”). The preparation of financial statements requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of income and expenses for the period. Actual results could differ from those estimates.
(a) | Security Valuation |
Securities for which market quotations are readily available are valued at current market value as of “Valuation Time.” Valuation Time is as of the close of regular trading on the New York Stock Exchange (usually 4 p.m. Eastern time). Equity securities are valued at the last quoted sale price or, if there is no sale price, the last quoted bid price provided by an independent pricing service approved by the Trust’s Board of Trustees (“Board of Trustees”). Securities traded on NASDAQ are valued at the NASDAQ official closing price. Prices are taken from the primary market or exchange in which each security trades. | |
Most securities listed on a foreign exchange are valued either at fair value (see description below) or at the last sale price at the close of the exchange on which the security is principally traded. Foreign securities, currencies, and other assets and liabilities denominated in foreign currencies are translated into U.S. dollars at the exchange rate of said currencies against the U.S. dollar, as of Valuation Time, as provided by an independent pricing service approved by the Board of Trustees. | |
Debt (including defaulted issues) and other fixed income securities (other than short-term obligations) are valued at the last quoted bid price and/or by using a combination of daily quotes and matrix evaluations provided by an independent pricing service, the use of which has been approved by the Board of Trustees. Short-term debt securities, such as commercial paper and U.S. Treasury Bills having a remaining maturity of 60 days or less at the time of purchase, are considered to be “short-term” and are valued at amortized cost, which approximates market value. | |
Securities for which market quotations are not readily available, or for which an independent pricing service does not provide a value or provides a value that does not represent fair value in the judgment of the Fund’s investment adviser or designee, are valued at fair value under procedures approved by the Board of Trustees. The “Fair Value” of these securities is determined in good faith by taking into account relevant factors and surrounding circumstances. Methods utilized to obtain a “Fair Value” may include the following non-exclusive list of acceptable methods: (i) a multiple of earnings; (ii) the discount from market value of a similar, freely traded security; (iii) the yield-to-maturity |
for debt issues; or (iv) a consolidation of the methods. The Trust’s Valuation & Operations Committee considers a non-exclusive list of factors to arrive at the appropriate method of determining “Fair Value.” For example, fair value determinations are required for securities whose value is affected by a “significant” event that materially affects the value of a domestic or foreign security which occurs subsequent to the time of the close of the principal market on which such domestic or foreign security trades and before the Valuation Time (i.e., a “subsequent event”). Typically, this will involve events occurring after the close of a foreign market on which a security trades and before the next Valuation Time. | |
The Fund values foreign securities at fair value in the circumstances described below. Generally, trading in foreign securities markets is completed each day at various times prior to the Valuation Time. Due to the time differences between the closings of the relevant foreign securities exchanges and the Valuation Time for the Fund, the Fund will fair value its foreign investments when it is determined that the market quotations for the foreign investments either are not readily available or are unreliable and, therefore, do not represent fair value. When the fair value prices are utilized, these prices will attempt to reflect the impact of the U.S. financial markets’ perceptions and trading activities on the Fund’s foreign investments since the last closing prices of the foreign investments were calculated on their primary foreign securities markets or exchanges. For these purposes, the Board of Trustees has determined that movements in relevant indices or other appropriate market indicators, after the close of the foreign securities exchanges, may demonstrate that market quotations are unreliable, and may trigger fair value pricing for certain securities. Consequently, fair valuation of portfolio securities may occur on a daily basis. |
(b) | Repurchase Agreements |
The Fund may enter into repurchase agreements with an entity which is a member of the Federal Reserve System or which is a “primary dealer” (as designated by the Federal Reserve Bank of New York) in U.S. Government obligations. The repurchase price generally equals the price paid by the Fund plus interest negotiated on the basis of current short-term rates, which may be more or less than the rate on the underlying portfolio securities. The seller under a repurchase agreement is required to maintain the value of the collateral held pursuant to the agreement at a market value equal to or greater than the repurchase price (including accrued interest). Collateral subject to repurchase agreements is held by the Fund’s custodian or another qualified sub-custodian or in the Federal Reserve/ Treasury book-entry system. If the counterparty defaults and the fair value of the collateral declines, realization of the collateral by the Fund may be delayed or limited. The Fund may transfer uninvested cash balances into a pooled cash account. These balances are invested in one or more repurchase agreements, with the counterparty of Nomura Securities, which is fully collateralized by U.S. Government Agency Mortgages. |
(c) | Foreign Currency Transactions |
The accounting records of the Fund are maintained in U.S. dollars. Foreign currency amounts are translated into U.S. dollars at the current rate of exchange to determine the value of investments, assets and liabilities. The Fund may enter into foreign currency contracts in connection with purchases or sales of securities denominated in a foreign currency. Purchases and sales of securities, and income and expenses, are translated at the prevailing rate of exchange on the respective date of these transactions. The Fund does not isolate that portion of the results of operations resulting from changes in foreign exchange rates on investments from fluctuations arising from changes in market prices of securities held. These fluctuations are included with the net realized and unrealized gain or loss from investments and foreign currencies. |
(d) | Forward Foreign Currency Contracts |
The Fund may enter into forward foreign currency contracts in connection with planned purchases or sales of securities or to hedge the U.S. dollar value of portfolio securities denominated in a particular currency. The Fund could be exposed to risks if the counterparties to the contracts are unable to meet the terms of their contracts and from unanticipated movements in the value of a foreign currency relative to the U.S. dollar. Forward foreign currency contracts are valued at the current cost of covering these contracts, as provided by an independent pricing service |
approved by the Board of Trustees. The forward foreign currency contracts are adjusted by the daily exchange rate of the underlying currency and any gains or losses are recorded for financial statement purposes as unrealized gains or losses until the contract settlement date. |
(e) | Futures Contracts |
The Fund may invest in financial futures contracts (“futures contracts”) for the purpose of hedging its existing portfolio securities or securities that the Fund intends to purchase against fluctuations in value caused by changes in prevailing market interest rates or prices. Futures contracts may also be entered into for non-hedging purposes. | |
Upon entering into a futures contract, the Fund is required to pledge to the broker an amount of cash and/or other assets equal to a certain percentage of the contract amount (initial margin deposit). Subsequent payments, known as “variation margin,” are made each day, depending on the daily fluctuations in the fair value/market value of the underlying assets. A gain or loss equal to the daily variation margin is recognized on a daily basis. Futures contracts are valued daily at their last quoted sale price. | |
A “sale” of a futures contract means the creation of a contractual obligation to deliver the securities or foreign currency called for by the contract at a fixed price at a specified time in the future. A “purchase” of a futures contract means the creation of a contractual obligation to acquire the securities or foreign currency at a fixed price at a specified time in the future. | |
Should market conditions change unexpectedly, the Fund may not achieve the anticipated benefits of the futures contracts and may realize a loss. The use of futures transactions for hedging purposes involves the risk of imperfect correlation in movements in the price of futures contracts, interest rates, and the value of the underlying hedged assets. |
(f) | Written Options Contracts |
The Fund may write options contracts. A written option obligates the Fund to deliver (written call) or to receive (written put) a specified quantity of an underlying asset at the contract amount upon exercise by the holder of the option. When the Fund writes an option, an amount equal to the premium received by the Fund is recorded as a liability and is subsequently adjusted to the current fair value of the option written. Premiums received from writing options that expire unexercised are treated by the Fund on the expiration date as realized gains from investments. The difference between the premium and the amount paid on effecting a closing purchase transaction, as a realized loss. If a call option is exercised, the premium is added to the proceeds from the sale of the underlying security or currency in determining whether the Fund has realized a gain or loss. If a put option is exercised, the premium reduces the cost basis of the securities purchased by the Fund. Options traded on an exchange are valued at the last quoted sale price, or in the absence of a sale, the bid price provided by an independent pricing service approved by the Board of Trustees. Non-exchange traded options are valued using dealer supplied quotes. The Fund as a writer of an option bears the market risk of an unfavorable change in the price of the security underlying the written option. |
(g) | Short Sales |
The Fund is authorized to engage in short-selling of portfolio securities which obligates the Fund to replace any security that the Fund has borrowed by purchasing the security at current market value sometime in the future. The Fund will incur a loss if the price of the security increases between the date of the short sale and the date on which the Fund replaces the borrowed security. The Fund generally will realize a gain if the price of the security declines between these dates. Until the Fund replaces the borrowed security, the Fund will maintain a segregated account with cash, U.S. Government securities and/or securities held long to sufficiently cover the Fund’s short position on a daily basis. Dividends declared on securities sold short are recorded as an expense on the ex-dividend date and paid to the counterparty on the dividend pay date. |
(h) | Security Transactions and Investment Income |
Security transactions are accounted for on the date the security is purchased or sold (“trade date”). Securities gains and losses are calculated on the identified cost basis. Interest income is recognized on the accrual basis and includes, where applicable, the amortization or accretion of premium or discount. Dividend income is recorded on the ex-dividend date. |
(i) | Securities Lending |
To generate additional income, the Fund may lend its portfolio securities, up to 33 1/3% of the Fund, to brokers, dealers and other financial institutions provided that (1) the borrower delivers cash or securities as collateral with respect to each new loan of U.S. securities, equal to at least 102% of the value of the portfolio securities loaned, and with respect to each new loan on non-U.S. securities, collateral of at least 105% of the value of the portfolio securities loaned; and (2) at all times thereafter shall require the borrower to mark-to-market the collateral on a daily basis so that the market value of such collateral does not fall below 100% of the value of securities loaned. The Fund receives payments from borrowers equivalent to the dividends and interest that would have been earned on securities loaned while simultaneously seeking to earn income on the investment of cash collateral. There may be risks of delay in recovery of the securities should the borrower of the securities fail financially. Loans will be made, however, only to borrowers deemed by the Fund’s investment adviser to be of good standing and creditworthy under guidelines established by the Board of Trustees and when, in judgment of the adviser, the consideration which can be earned currently from these securities loans justifies the attendant risks. Loans are subject to termination by the Fund or the borrower at any time, and, therefore, are not considered to be illiquid investments. JPMorgan Chase Bank serves as custodian for the securities lending program of the Fund. JPMorgan Chase Bank receives a fee based on the value of the collateral received from borrowers. | |
Information on the investment of cash collateral is shown in the Statement of Investments. | |
As of June 30, 2007, the Fund had securities with the following value on loan: |
Value of | ||||||
Value of Loaned Securities | Collateral | |||||
$1,351,680 | $ | 1,415,775 | ||||
(j) | Distributions to Shareholders |
The Fund’s dividends from net investment income, if any, are declared and paid quarterly. The Fund’s distributions from net realized capital gains, if any, are declared and distributed at least annually. | |
Dividends and distributions to shareholders are determined in accordance with federal income tax regulations, which may differ from GAAP. These “book/tax” differences are considered either permanent or temporary in nature. In accordance with the American Institute of Certified Public Accountants Statement of Position 93-2, permanent differences (i.e., reclassification of market discounts, foreign exchange gain/loss, paydowns, and distributions from real estate investment trusts) are reclassified within the capital accounts based on their nature for federal income tax purposes; temporary differences do not require reclassification. These reclassifications have no effect upon the net asset value of the Fund. To the extent distributions exceed current and accumulated earnings and profits for federal income tax purposes, these distributions are reported as distributions of paid-in-capital. |
(k) | Federal Income Taxes |
It is the policy of the Fund to qualify or to continue to qualify as a “regulated investment company” by complying with the provisions available to certain investment companies, as defined in Subchapter M of the U.S. Internal Revenue Code, and to make distributions of net investment income and net realized capital gains sufficient to relieve the Fund from all, or substantially all, federal income taxes. |
As of June 30, 2007, the tax cost of securities and the breakdown of unrealized appreciation (depreciation) for the Fund was as follows: |
Net | ||||||||||||||||
Unrealized | ||||||||||||||||
Tax Cost of | Unrealized | Unrealized | Appreciation | |||||||||||||
Securities | Appreciation | Depreciation | (Depreciation) | |||||||||||||
$ | 57,593,701 | $ | 5,168,138 | $ | (727,242 | ) | $ | 4,440,896 | ||||||||
(l) | Allocation of Expenses, Income, and Gains and Losses |
Expenses directly attributable to the Fund are charged to the Fund. Expenses not directly attributable to the Fund are allocated proportionately among various or all funds within the Trust. The method used by the Fund for allocating income, fund level expenses, and realized and unrealized gains or losses is based on the fair value of shares outstanding relative to net assets. Under this method, each class of shares participates based on the total net asset value of that class’s shares in proportion to the total net assets of the Fund. Expenses specific to a class (such as Rule 12b-1 and administrative services fees) are charged to that class. |
3. Transactions with Affiliates
Under the terms of the Trust’s Investment Advisory Agreement, Nationwide Fund Advisors (formerly, Gartmore Mutual Fund Capital Trust (“GMF”)) (“NFA” or the “Advisor”) manages the investment of the assets and supervises the daily business affairs of the Fund. NFA is a wholly-owned subsidiary of Nationwide Financial Services (“NFS”). In addition, NFA provides investment management evaluation services in initially selecting and monitoring, on an ongoing basis, the performance of the subadviser for the Fund. Gartmore Global Partners (the “subadviser”) manages all of the Fund’s investments and has the responsibility for making all investment decisions for the Fund.
Under the terms of the Investment Advisory Agreement, the Fund pays NFA an investment advisory fee based on that Fund’s average daily net assets. Additional information regarding investment advisory fees and subadvisory fees for NFA and the subadviser is as follows for the six months ended June 30, 2007:
Total | ||||||
Base Management Fee | Fees | |||||
Up to $50 million | 0.90% | |||||
$50 million or more | 0.85% | |||||
From such fees, pursuant to the subadvisory agreement, NFA paid the subadviser $185,116 for the six months ended June 30, 2007.
The Fund’s base management fee (as adjusted for any applicable breakpoints) may increase or decrease proportionately depending on how the Fund performs relative to its benchmark, the MSCI World Index. This performance fee is intended to reward or penalize the investment adviser for outperforming or underperforming the Fund’s benchmark.
The calculation of the total management fee is done in two separate steps. First, the Fund calculates a base fee (to be paid at the end of each quarter). The base fee rate results in an annual fee, calculated and accrued daily. The fee rate is applied to the Fund’s average net assets over that quarter. Second, a performance adjustment percentage is applied to the Fund’s average net assets over the 12-month rolling performance period. The performance adjustment amount is then added to (or subtracted from, as applicable) the base fee to arrive at the Fund’s total advisory fee for the most recently completed quarterly sub-period and that total fee is paid at the end of that most recently completed quarter.
The performance fee calculation applies to all of the Fund’s share classes equally, based on the performance of the Class III shares during the performance period. The table below shows the performance adjustment rate applicable to the Fund’s base fee.
Out or Underperformance | Change in Fees | |||||
+/- 1 percentage point | +/- 0.02% | |||||
+/- 2 percentage point | +/- 0.04% | |||||
+/- 3 percentage point | +/- 0.06% | |||||
+/- 4 percentage point | +/- 0.08% | |||||
+/- 5 percentage point | +/- 0.10% | |||||
The performance adjusted advisory fee will be paid quarterly.
Under this performance fee arrangement, the investment adviser can receive a performance fee increase even if the Fund experiences negative performance that still exceeds its benchmark by more than the relevant percentage amount shown above.
Under the terms of a Fund Administration and Transfer Agency Agreement, Nationwide Fund Management, LLC (formerly, Gartmore Investor Services, Inc. (“GISI”)) (“NFM”), a wholly-owned subsidiary of NFS Distributors, Inc. (“NFSDI”), provides the Fund with various administrative and accounting services for the Fund (Prior to May 1, 2007. this service was provided by Gartmore SA Capital Trust (“GSA”)), and serves as Transfer and Dividend Disbursing Agent for the Fund (prior to May 1, 2007, this service was provided by GISI, an indirect subsidiary of GSA.) The fees for the services provided under this Agreement are calculated based on the Trust’s average daily net assets according to the fee schedule below. The fees are then allocated proportionately among all funds within the Trust in relation to the average daily net assets of each fund and are paid to NFA. NFA pays NFM from these fees for NFM’s services.
Combined Fee Schedule* | ||||||
Up to $1 billion | 0.15% | |||||
$1 billion up to $3 billion | 0.10% | |||||
$3 billion up to $8 billion | 0.05% | |||||
$8 billion up to $10 billion | 0.04% | |||||
$10 billion up to $12 billion | 0.02% | |||||
$12 billion or more | 0.01% | |||||
* | The assets of the Nationwide NVIT Investor Destinations Aggressive Fund, the Nationwide NVIT Investor Destinations Moderately Aggressive Fund, the Nationwide NVIT Investor Destinations Moderate Fund, the Nationwide NVIT Investor Destinations Moderately Conservative Fund, and the Nationwide NVIT Investor Destinations Conservative Fund (collectively, the “Investor Destinations Funds”) are excluded from the Trust asset level amount in order to calculate this asset-based fee. The Investor Destinations Funds do not pay any part of this fee. |
NFA and NFM have entered into agreements with Citi Fund Services Ohio, Inc. (“Citi”), pursuant to which Citi provides sub-administration and sub-transfer agency services, respectively, to the Fund. Effective August 1, 2007, The BISYS Group Inc. was acquired by and became a wholly owned subsidiary of Citi.
Under the terms of a Distribution Plan under Rule 12b-1 of the 1940 Act, Nationwide Fund Distributors, LLC. (formerly, “Gartmore Distribution Services, Inc. (“GDSI”)) (“NFD” or “Distributor”), the Fund’s principal underwriter, is compensated by the Fund for expenses associated with the distribution of the Class II shares of the Fund. NFD is a wholly-owned subsidiary of NFSDI. These fees are based on average daily net assets of Class II shares of the Fund at an annual rate not to exceed 0.25%.
Under the terms of an Administrative Services Plan, the Fund may pay fees to servicing organizations, such as broker-dealers, including NFS, and financial institutions, which agree to provide administrative support services to the
For the six months ended June 30, 2007, NFS received $46,019 in Administrative Services Fees from the Fund.
Under the terms of a letter agreement dated September 12, 2006, by and among NFA, the Audit Committee of the Trust and the Trust, the Trust has agreed to reimburse NFA certain costs related to the Fund’s portion of ongoing administration, monitoring and annual (audit) testing of the Trust’s Rule 38a-1 Compliance Program subject to the pre-approval of the Trust’s Audit Committee. For the six months ended June 30, 2007, the Fund’s portion of such costs amounted to $403.
4. Short-Term Trading Fees
The Fund reserves the right to assess a short-term trading fee on certain transactions out of Class III shares that a separate account makes on behalf of a variable insurance contract owner (the “contract owner”). A separate account that redeems Class III shares on behalf of a contract owner may be subject to a 1.00% short-term trading fee if the separate account held the Class III shares on behalf of the contract owner for 60 days or less, unless an exception applies as disclosed in the Fund’s prospectus. The short-term trading fee is paid directly to the Fund and is intended to offset the cost to the Fund of excess brokerage commissions and other costs associated with fluctuations in Fund asset levels and cash flow caused by short-term trading. For purposes of determining whether the short-term trading fee applies, the Class III shares that were held on behalf of the contract owner the longest will be treated as being redeemed first.
For the six months ended June 30, 2007, the Fund had contributions to capital due to collection of redemption fees in the amount of $2,361.
5. Investment Transactions
For the six months ended June 30, 2007, (excluding short-term securities) the Fund had purchases of $82,274,038 and sales of $81,750,298.
6. Bank Loans and Earnings Credit
The Trust has a credit agreement with JPMorgan Chase & Co., the Fund’s custodian bank, permitting the Trust to borrow up to $100,000,000. Borrowings under this arrangement bear interest at the Federal Funds rate plus 0.50%. The interest costs, if any, would be included in other fees in the Statement of Operations. No compensating balances were required under the terms of the line of credit. The line of credit is renewed annually, expiring on June 25, 2008, with a commitment fee of 0.07% per year on $100,000,000. There were no borrowings outstanding under this line of credit for the six months ended June 30, 2007.
The Trust’s custodian bank has agreed to reduce the bank’s fees (earnings credit) when the funds of the Trust maintain cash on deposit in non-interest-bearing custody and Demand Deposit Accounts. Earnings credits, if any, are shown as a reduction of total expenses on the Statement of Operations.
7. Portfolio Investment Risks
Risks Associated with Foreign Securities and Currencies. Investments in securities of foreign issuers carry certain risks not ordinarily associated with investments in securities of U.S. issuers. These risks include future political and economic developments, and the possible imposition of exchange controls or other foreign governmental laws and restrictions. In addition, with respect to certain countries, there is the possibility of expropriation of assets, confiscatory taxation, political or social instability, or diplomatic developments, which could adversely affect investments in those countries.
Certain countries also may impose substantial restrictions on investments in their capital markets by foreign entities, including restrictions on investments in issuers of industries deemed sensitive to relevant national interests. These factors
Credit and Market Risk. The Fund invests in emerging market instruments that are subject to certain additional credit and market risks. The yields of emerging market debt obligations reflect, among other things, perceived credit risk. The Fund’s investment in securities rated below investment grade typically involve risks not associated with higher rated securities including, among others, greater risk of not receiving timely and/or ultimate payment of interest and principal, greater market price volatility, and less liquid secondary market trading. The consequences of political, social, economic, or diplomatic changes may have disruptive effects on the market prices of emerging markets investments held by the Fund.
8. Indemnifications
Under the Trust’s organizational documents, certain of the Trust’s Officers and Trustees are indemnified against certain liabilities arising out of the performance of their duties to the Trust. In addition, the Trust has entered into Indemnification Agreements with the Trust’s trustees and certain officers covering similar liabilities. Trust Officers receive no compensation from the Trust for serving as the Trust’s Officers. In addition, in the normal course of business, the Trust enters into contracts with its vendors and others that provide for general indemnifications. The Trust’s maximum exposure under these arrangements is unknown, as this would involve future claims that may be made against the Trust. Based on experience, however, the Trust expects that risk of loss to be remote.
9. Recently Issued Accounting Pronouncements
On July 13, 2006, the Financial Accounting Standards Board (“FASB”) released FASB Interpretation No. 48, Accounting for Uncertainty in Income Taxes (“FIN 48”). FIN 48 provides guidance for how uncertain tax positions should be recognized, measured, presented and disclosed in the financial statements. FIN 48 requires the affirmative evaluation of tax positions taken or expected to be taken in the course of preparing the Fund’s tax returns to determine whether it is more-likely-than-not (i.e., greater than 50 percent) that each tax position will be sustained upon examination by a taxing authority based on the technical merits of the position. A tax position that meets the more-likely-than-not recognition threshold is measured to determine the amount of benefit to recognize in the financial statements. Differences between tax positions taken in a tax return and amounts recognized in the financial statements will generally result in an increase in a liability for taxes payable (or a reduction of a tax refund receivable) and an increase in a deferred tax liability (or a reduction in a deferred tax asset). Adoption of FIN 48 was required no later than the last business day of the first financial statement reporting period for fiscal years beginning after December 15, 2006 and is to be applied to all open tax years as of the effective date. Accordingly, the Fund was required to implement FIN 48 in its net asset value per share (NAV) calculation on June 29, 2007. Management has evaluated the implications of FIN 48 and has concluded that there was no impact to the Fund’s financial statements as of June 29, 2007. The adoption of FIN 48 requires ongoing monitoring and analysis, future conclusions reached by management may be different and result in adjustments to the Fund’s NAV and financial statements.
In September 2006, the FASB issued Statement on Financial Accounting Standards (“SFAS”) No. 157, “Fair Value Measurements.” This standard establishes a single authoritative definition of fair value, sets out a framework for measuring fair value and requires additional disclosures about fair value measurements. SFAS No. 157 applies to fair value measurements already required or permitted by existing standards. SFAS No. 157 is effective for financial statements issued for fiscal years beginning after November 15, 2007 and interim periods within those fiscal years. The changes to current accounting principles generally accepted in the United States of America from the application of this Statement relate to the definition of fair value, the methods used to measure fair value, and the expanded disclosures about fair value measurements. As of June 30, 2007, the Fund does not believe the adoption of SFAS No. 157 will impact the financial statement amounts; however, additional disclosures may be required about the inputs used to develop the measurements and the effect of certain of the measurements on changes in net assets for the period.
Trustees who are not Interested Persons (as defined in the 1940 Act) and Officers of the Trust as of
Number of Portfolios | ||||||||||
Position(s) Held | in the | |||||||||
with the Trust | Principal Occupation(s) | Nationwide Fund | Other | |||||||
Name, Address | and Length of | During Past | Complex Overseen | Directorships | ||||||
and Year of Birth | Time Served1 | Five Years | by Trustee | Held by Trustee2 | ||||||
Charles E. Allen c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1948 | Trustee since July 2000 | Mr. Allen is Chairman, Chief Executive Officer and President of Graimark Realty Advisors, Inc. (real estate development, investment and asset management). | 89 | None | ||||||
Paula H.J. Cholmondeley c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1947 | Trustee since July 2000 | Ms. Cholmondeley was Vice President and General Manager of Sappi Fine Paper North America from April 2000 through December 2003. | 89 | Director of Dentsply International, Inc. (dental products), Ultralife Batteries, Inc., Terex Corporation (construction equipment), Minerals Technology, Inc. (specialty chemicals) and Albany International Corp. (paper industry) | ||||||
C. Brent DeVore3 c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1940 | Trustee since 1990 | Dr. DeVore is President of Otterbein College. | 89 | None | ||||||
Phyllis Kay Dryden c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1947 | Trustee since December 2004 | Ms. Dryden was a partner of Mitchell Madison, a management consulting company from January 2006 until December 2006; she is currently a consultant with the company. Ms. Dryden was formerly Managing Partner of march FIRST, a global management consulting firm. | 89 | None | ||||||
Barbara L. Hennigar c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1935 | Trustee since July 2000 | Retired. | 89 | None | ||||||
Number of Portfolios | ||||||||||
Position(s) Held | in the | |||||||||
with the Trust | Principal Occupation(s) | Nationwide Fund | Other | |||||||
Name, Address | and Length of | During Past | Complex Overseen | Directorships | ||||||
and Year of Birth | Time Served1 | Five Years | by Trustee | Held by Trustee2 | ||||||
Barbara I. Jacobs c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1950 | Trustee since December 2004 | Ms. Jacobs served as Chairman of the Board of Directors of KICAP Network Fund, a European (United Kingdom) hedge fund, from January 2001 through January 2006. From 1998-2003, Ms. Jacobs was also a Managing Director and European Portfolio Manager of CREF Investments (Teachers Insurance and Annuity Association-College Retirement Equities Fund). | 89 | None | ||||||
Douglas F. Kridler c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1955 | Trustee since September 1997 | Mr. Kridler has served as the President and Chief Executive Officer of the Columbus Foundation (a Columbus, OH-based foundation which manages over 1,300 individual endowment funds) since February 2002. Prior to January 31, 2002, Mr. Kridler was the President of the Columbus Association for the Performing Arts and Chairman of the Greater Columbus Convention and Visitors Bureau. | 89 | None | ||||||
Michael D. McCarthy c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1947 | Trustee since December 2004 | Retired. Mr. McCarthy was Chairman of VMAC (commodity swaps) from October 2002 until January 2007; and a partner of Pineville Properties LLC (a commercial real estate development firm) from September 2000 until January 2007. | 89 | None | ||||||
David C. Wetmore c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1948 | Trustee since 1995 and Chairman since February 2005 | Retired. | 89 | None | ||||||
1 | Length of time served includes time served with the Trust’s predecessors. | |
2 | Directorships held in (1) any other investment companies registered under the 1940 Act, (2) any company with a class of securities registered pursuant to Section 12 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or (3) any company subject to the requirements of Section 15(d) of the Exchange Act. | |
3 | Mr. DeVore has served as President of Otterbein College since 1984. Mark Thresher, President and Chief Operating Officer of Nationwide Financial Services, Inc. (“NFS”) has served as a member of the Board of Trustees of Otterbein College since 2000, currently serves as one of 30 of its trustees, and is currently one of two Vice Chairmen of the Board. Each of Nationwide Fund Advisors (“NFA”), the Funds’ investment adviser, and Nationwide Fund Distributors LLC (“NFD”), principal underwriter to the Trust, is a wholly-owned subsidiary of NFS. | |
Additional information regarding the Trustees and Officers may be found in the Trust’s Statement of Additional Information, which is available without charge upon request, by calling 800-848-0920. |
Trustees who are Interested Persons (as defined in the 1940 Act) and/or Officers of the Trust as of
Number of Portfolios | ||||||||||
Position(s) Held | in the | |||||||||
with the Trust | Principal Occupation(s) | Nationwide Fund | Other | |||||||
Name, Address | and Length of | During Past | Complex Overseen | Directorships | ||||||
and Year of Birth | Time Served1 | 5 Years | by Trustee | Held by Trustee 2 | ||||||
Arden L. Shisler c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1941 | Trustee since February 2000 | Retired. Mr. Shisler is the former President and Chief Executive Officer of KeB Transport, Inc., a trucking firm (2000 through 2002). He served as a consultant to KeB from January 2003 through December 2004. Since 1992, Mr. Shisler has also been Chairman of the Board for Nationwide Mutual Insurance Company.3 | 89 | Director of Nationwide Financial Services, Inc., Chairman of Nationwide Mutual Insurance Company3 | ||||||
John H. Grady Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1961 | President & Chief Executive Officer since December 2006 | Mr. Grady is President, and Chief Executive Officer of Nationwide Funds Group which includes Nationwide Fund Advisors,3 Nationwide Fund Management LLC,3 Nationwide Fund Distributors LLC 3 and NWD Investments,2 the asset management operations of Nationwide Mutual Insurance Company, which includes Morley Capital Management, Inc.,2 Nationwide Separate Accounts LLC,2 NorthPointe Capital LLC,2 and Nationwide SA Capital Trust2. From March 2004 until March 2006, Mr. Grady was Chief Executive Officer of Constellation Investment Management Co., L.P. (registered investment adviser), and President and Chief Executive Officer of Constellation Funds Group (registered investment companies). He also was President of Constellation Investment Distribution Co., Inc. (registered broker-dealer) from March 2004 until June 2006. From February 2001 until February 2004, Mr. Grady was Chief Operating and Chief Legal Officer; Managing Director, Mutual Funds Group, Turner Investment Partners, Inc. (registered investment adviser); Executive Vice President of Turner Funds and Turner Institutional Portfolios (registered investment companies); and President, Turner Investment Distributors, Inc. (registered broker-dealer). | N/A | None | ||||||
Gerald J. Holland Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1951 | Treasurer since March 2001 | Mr. Holland is Senior Vice President—Operations for Nationwide Funds Group3. | N/A | N/A | ||||||
Number of Portfolios | ||||||||||
Position(s) Held | in the | |||||||||
with the Trust | Principal Occupation(s) | Nationwide Fund | Other | |||||||
Name, Address | and Length of | During Past | Complex Overseen | Directorships | ||||||
and Year of Birth | Time Served1 | 5 Years | by Trustee | Held by Trustee 2 | ||||||
Michael A. Krulikowski Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1959 | Chief Compliance Officer from June 2004 to August 20074 | Mr. Krulikowski is Vice President and Chief Compliance Officer of Nationwide Funds Group3, Morley Capital Management, Inc.3, Nationwide SA Capital Trust (since 1999)3, and Nationwide Separate Accounts LLC (since August 2005).3 Since June 2004, Mr. Krulikowski has also served as Chief Compliance Officer of the Trust. From November 1999 through May 2007, he served as Vice President and Chief Compliance Officer of NorthPointe Capital LLC. 3 | N/A | N/A | ||||||
Eric E. Miller Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1953 | Secretary since December 2002 | Mr. Miller is Senior Vice President, General Counsel, and Assistant Secretary for Nationwide Funds Group3 and NWD Investments.2 From August 2000 to August 2002, Mr. Miller was a Partner with Stradley Ronon Stevens & Young, LLP. | N/A | N/A | ||||||
1 | Length of time served includes time served with the Trust’s predecessors. | |
2 | Directorships held in (1) any other investment companies registered under the 1940 Act, (2) any company with a class of securities registered pursuant to Section 12 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or (3) any company subject to the requirements of Section 15(d) of the Exchange Act. | |
3 | This position is held with an affiliated person or principal underwriter of the Trust. | |
4 | Effective August 3, 2007, the Board of Trustees approved Carol Baldwin Moody as Chief Compliance Officer of the Trust. Since November 2005, Ms. Moody has been Senior Vice President, Chief Compliance Officer of Nationwide Financial Services, Nationwide Life Insurance Company, Nationwide Life and Annuity Insurance Company, and Nationwide Investment Advisors, LLC. From February 2004-November 2005, she was Chief Compliance Officer of TIAA-CREF and from April 2000-February 2004, she was Managing Director and General Counsel, TCW/ Latin America Partners, LLC and Baeza & Co., LLC. | |
Federal law requires the Trust, each of its investment advisers and sub-advisers to adopt procedures for voting proxies (“Proxy Voting Guidelines”) and to provide a summary of those Proxy Voting Guidelines used to vote the securities held by the Funds. The Funds’ proxy voting policies and procedures are available without charge (i) upon request, by calling 800-848-0920, (ii) on the Funds’ website at www.nationwidefunds.com, or (iii) on the Securities and Exchange Commission’s website at www.sec.gov. |
A. Renewal of Investment Advisory Agreement
(i) | General Information Regarding the Board’s Review of Investment Advisory Agreements |
The Trust’s investment advisory agreements (each an “Advisory Agreement”) with its investment adviser and, as applicable, sub-advisers (together, the “Adviser”) must be approved for an initial term no greater than two years, and renewed at least annually thereafter, (i) by the vote of the Trustees or by a vote of the shareholders of each series or fund of the Trust (individually a “Fund” ), and (ii) by the vote of a majority of the Trustees who are not parties to the Advisory Agreement or “interested persons” of any party thereto (the “Independent Trustees”) cast in person at a meeting called for the purpose of voting on such approval.
The Board meets quarterly and takes into account throughout the year matters bearing on each Fund’s Advisory Agreement. The Board and its standing committees consider at each meeting factors that are relevant to the annual renewal of an Advisory Agreement, including the services and support provided to a Fund and its shareholders.
On December 6, 2006, the Independent Trustees first met in person with their independent legal counsel (“Independent Legal Counsel”) to consider information provided by the Adviser and others to assist the Trustees in considering whether to renew each Fund’s Advisory Agreement for a one year term beginning May 1, 2007. Immediately following such meeting of the Independent Trustees, all Trustees met in person with the Adviser, Trust counsel, Independent Legal Counsel and others to consider such matters, and give preliminary consideration to information bearing on continuation of each Advisory Agreement. The primary purpose of the December 6 and 7, 2006 meeting was to ensure that the Trustees had ample opportunity to consider matters they deemed relevant in considering the continuation of an Advisory Agreement, and to request any additional information they considered reasonably necessary to their deliberations.
In preparation for the December 6 and 7, 2006 meeting the Trustees were provided, at the request of the Trustees, with a wide range of information to assist in their deliberations, including (i) reports from Lipper Inc. describing a Fund’s (a) performance rankings (where “first quintile” denotes the best performance) (over multiple years ended September 30, 2006) compared with performance groups and performance universes created by Lipper (and in some cases, customized peer groups created by the Adviser) of similar or peer group funds, and (b) expense rankings (where “first quintile” denotes the lowest fees and expenses) comparing the Fund’s contractual advisory fee and total expenses with expense groups and expense universes created by Lipper of similar or peer group funds, (ii) information from the Adviser describing the Fund’s performance (over multiple years ended September 30, 2006) compared with its benchmark and Lipper categories, (iii) for Funds under “close review,” copies of letters from the Adviser to the portfolio manager of each such Fund, together with the portfolio manager’s written response describing the reasons for the Fund’s underperformance (iv) information from the Adviser describing performance for the months of October and November, 2006, and annual performance for the year ended November 30, 2006, (v) reports from the Adviser describing the Adviser’s profitability in providing services under an Advisory Agreement, together with an explanation of Adviser’s methodology in calculating its profitability, (vi) information from the Adviser describing any fees paid to the Adviser for managing similar, non-affiliated institutional accounts, including the range of fee levels for such accounts, and (vii) information from the Adviser describing ancillary benefits, in addition to fees for serving as investment adviser, derived by the Adviser as a result of being investment adviser for a Fund, including, where applicable, information on soft-dollar benefits and fees inuring to the Adviser’s affiliates for serving as the Trust’s administrator, fund accountant and transfer agent.
At the December 6 and 7, 2006 meeting, the Trustees reviewed, considered and discussed, among themselves and with the Adviser, Trust counsel and Independent Legal Counsel, among other things, the information described above, and: (i) the nature, extent and quality of services provided by the Adviser under each Advisory Agreement, (ii) the investment performance of each Fund and the Adviser, (iii) the costs of the services provided by the Adviser under the Advisory Agreement and the profits realized by the Adviser thereunder, (iv) the extent to which economies of scale may be present and, if so, whether they are being shared with a Fund’s shareholders, (v) comparisons of the Adviser’s fees under the Advisory Agreement with investment advisory fees paid by peer group funds to their investment advisers and paid by non-affiliated institutional clients to the Adviser for managing similar accounts, and (vi) any ancillary benefits inuring to the Adviser and its affiliates as a result of being investment adviser for the Trust. The Trustees also considered, where
As part of the December 6 and 7, 2006 Board meeting, the Independent Trustees developed a list of follow-up matters and questions and asked that Adviser respond to such matters and questions at the contract approval meeting of the Board of Trustees to be held on January 11, 2007.
At the January 11, 2007 meeting of the Board of Trustees of the Trust, the Board received and considered information provided by the Adviser in follow-up from the December 6 and 7, 2006 Board meeting and, after consulting among themselves, and with the Adviser, Trust counsel and Independent Legal Counsel, concluded unanimously to renew the Advisory Agreement for the reasons set forth in the following section. In determining whether to renew the Advisory Agreement for the Fund, the Board ultimately reached a determination, with the assistance of Trust counsel and Independent Legal Counsel, that the renewal of the Advisory Agreement and the compensation to be received by the Adviser under the Advisory Agreement is consistent with the Board’s fiduciary duty under applicable law.
(ii) | Board Conclusions Regarding the Fund’s Advisory Agreement |
The Board considered that the Fund had underperformed its benchmark, the MSCI Emerging Markets Index, for the one-, three-, and five-year periods. The Board also considered that the Fund’s Class II shares had ranked in the fifth quintile of the Fund’s Lipper-constructed Performance Group over the one-, two-, three-, four-, and five-year periods. Although the Fund’s performance compared with peer group funds over the periods considered ranked the Fund in the fifth quintile, the Board found that: (i) the portfolio manager for the Fund was changed during the year; (ii) recent performance had shown improvement; and (iii) the flows in and out of the Fund had been more extreme, which made management more difficult, and had affected performance. Based on its review, and giving particular weight to the nature and quality of the resources dedicated by the adviser and subadviser to improve relative performance, the Board concluded that the nature, extent, and quality of the services provided to the Fund will benefit the Fund’s shareholders.
The Board also considered that the Fund’s contractual advisory fee and breakpoints placed the Fund in the first quintile of its Lipper-constructed Expense Group and the Fund’s total expenses placed it in the second quintile. The Board considered that the Fund had implemented a performance fee structure, which is intended to either reward or penalize the adviser for outperforming or underperforming, respectively, the Fund’s benchmark. The Board concluded that the Fund’s management fee and total expenses were fair and reasonable in light of the services that the Fund receives and the other factors considered.
The Board considered that the Fund’s adviser reported a pre-tax profit margin for investment management services during each of the twelve month-periods ended September 30, 2006 and 2005. The Board considered the costs of the services provided by and the profits realized by the adviser in connection with the operation of the Fund and determined that the amount of profit is a fair entrepreneurial profit for the management of the Fund.
Based upon its evaluation of all of the conclusions noted above, and after considering all material factors with respect to the Fund, the Board ultimately concluded that the advisory fee structure is fair and reasonable, and that the Advisory Agreement (and, if applicable, Sub-Advisory Agreement) with respect to the Fund, should be renewed.
B. Approval of New Advisory Agreement
At its January 11, 2007 meeting, the Board also unanimously approved a new investment advisory agreement (the “New Agreement”) for the Fund with Nationwide Fund Advisors, (“NFA”) the then-current adviser to each of the series of the Trust to become effective upon the closing of the acquisition of NFA by Nationwide Financial Services, Inc. (“NFS”) from Nationwide Corporation (“NWC”) which closed on April 30, 2007 (the “Transaction”). In approving the New Agreement, the Board considered NFA’s capacity to continue to provide the services needed to operate a sophisticated investment management business and to support the management of each of the series. The Board also took into account
C. Submission of Matters to a Vote of Security Holders:
On April 25, 2007, a Special Meeting of Shareholders was held* (the “April 25 Meeting”) at which shareholders of the Funds** set forth below were asked:
Proposal 1:
To approve a new investment advisory agreement, on behalf of their Fund, between Nationwide Fund Advisors (formerly “Gartmore Mutual Fund Capital Trust”) (the “Adviser”) and Nationwide Variable Insurance Trust (formerly “Gartmore Variable Insurance Trust”) (the “Trust”).
Number of Shares | ||||||
Fund | Cast/Not Cast | Percentages | ||||
Federated NVIT High Income Bond Fund (Formerly Federated GVIT High Income Bond Fund) | FOR AGAINST ABSTAIN TOTAL | 30,051,703.188 shares 618,245.021 shares 1,813,550.431 shares 32,483,498.640 shares | 92.514% 1.903% 5.583% | |||
NVIT International Index Fund (Formerly GVIT International Index Fund) | FOR AGAINST ABSTAIN TOTAL | 4,322,203.982 shares 2,758.318 shares 135,636.840 shares 4,460,599.140 shares | 96.897% 0.062% 3.041% | |||
NVIT International Value Fund (Formerly GVIT International Value Fund) | FOR AGAINST ABSTAIN TOTAL | 20,032,843.199 shares 333,588.902 shares 1,093,293.879 shares 21,459,725.980 shares | 93.351% 1.554% 5.095% | |||
NVIT Mid Cap Index Fund (Formerly GVIT Mid Cap Index Fund) | FOR AGAINST ABSTAIN TOTAL | 35,380,179.120 shares 631,117.844 shares 1,565,714.306 shares 37,577,011.270 shares | 94.154% 1.679% 4.167% | |||
Number of Shares | ||||||
Fund | Cast/Not Cast | Percentages | ||||
NVIT S&P 500 Index Fund (Formerly GVIT S&P 500 Index Fund) | FOR AGAINST ABSTAIN TOTAL | 56,119,814.230 shares 666,195.542 shares 1,944,898.888 shares 58,730,908.660 shares | 95.554% 1.134% 3.312% | |||
Nationwide Multi-Manager NVIT Small Cap Growth Fund (Formerly GVIT Small Cap Growth Fund) | FOR AGAINST ABSTAIN TOTAL | 7,632,918.513 shares 149,458.111 shares 451,583.036 shares 8,233,959.660 shares | 92.700% 1.816% 5.484% | |||
Nationwide Multi-Manager NVIT Small Cap Value Fund (Formerly GVIT Small Cap Value Fund) | FOR AGAINST ABSTAIN TOTAL | 48,649,396.525 shares 979,183.753 shares 2,786,133.102 shares 52,414,713.380 shares | 92.816% 1.868% 5.316% | |||
Nationwide Multi-Manager NVIT Small Company Fund (Formerly GVIT Small Company Fund) | FOR AGAINST ABSTAIN TOTAL | 29,903,181.700 shares 838,774.923 shares 2,006,741.307 shares 32,748,697.930 shares | 91.311% 2.561% 6.128% | |||
Gartmore NVIT Developing Markets Fund (Formerly Gartmore GVIT Developing Markets Fund) | FOR AGAINST ABSTAIN TOTAL | 21,0177,889.443 shares 424,272.958 shares 1,543,850.729 shares 23,046,013.130 shares | 91.460% 1.841% 6.699% | |||
Gartmore NVIT Emerging Markets Fund (Formerly Gartmore GVIT Emerging Markets Fund) | FOR AGAINST ABSTAIN TOTAL | 17,050,534.593 shares 526,574.722 shares 881,608.905 shares 18,458,718.220 shares | 92.371% 2.853% 4.776% | |||
Nationwide NVIT Global Financial Services Fund (Formerly Gartmore GVIT Global Financial Services Fund) | FOR AGAINST ABSTAIN TOTAL | 1,554,847.333 shares 19,539.033 shares 52,206.494 shares 1,626,592.860 shares | 95.589% 1.201% 3.210% | |||
Nationwide NVIT Global Health Sciences Fund (Formerly Gartmore GVIT Global Health Sciences Fund) | FOR AGAINST ABSTAIN TOTAL | 4,722,963.678 shares 157,979.030 shares 207,642.222 shares 5,088,584.930 shares | 92.815% 3.104% 4.081% | |||
Nationwide NVIT Global Technology and Communications Fund (Formerly Gartmore GVIT Global Technology and Communications Fund) | FOR AGAINST ABSTAIN TOTAL | 8,585,472.039 shares 102,267.977 shares 489,577.634 shares 9,177,317.650 shares | 93.551% 1.114% 5.335% | |||
Gartmore NVIT Global Utilities Fund (Formerly Gartmore GVIT Global Utilities Fund) | FOR AGAINST ABSTAIN TOTAL | 4,123,270.549 shares 122,001.533 shares 240,276.088 shares 4,485,548.170 shares | 91.923% 2.720% 5.357% | |||
Nationwide NVIT Government Bond Fund (Formerly Gartmore GVIT Government Bond Fund) | FOR AGAINST ABSTAIN TOTAL | 88,471,567.462 shares 1,825,645.181 shares 5,841,990.727 shares 96,139,203.370 shares | 92.024% 1.899% 6.077% |
Number of Shares | ||||||
Fund | Cast/Not Cast | Percentages | ||||
Nationwide NVIT Growth Fund (Formerly Gartmore GVIT Growth Fund) | FOR AGAINST ABSTAIN TOTAL | 14,931,435.904 shares 409,826.402 shares 1,259,945.064 shares 16,601,207.370 shares | 89.942% 2.469% 7.589% | |||
Gartmore NVIT International Growth Fund (Formerly Gartmore GVIT International Growth Fund) | FOR AGAINST ABSTAIN TOTAL | 6,251,419.070 shares 139,618.548 shares 290,025.592 shares 6,681,063.210 shares | 93.569% 2.090% 4.341% | |||
Nationwide NVIT Investor Destinations Aggressive Fund (Formerly Gartmore GVIT Investor Destinations Aggressive Fund) | FOR AGAINST ABSTAIN TOTAL | 49,489,224.549 shares 1,385,396.474 shares 3,696,272.337 shares 54,570,893.360 shares | 90.688% 2.539% 6.773% | |||
Nationwide NVIT Investor Destinations Conservative Fund (Formerly Gartmore GVIT Investor Destinations Conservative Fund) | FOR AGAINST ABSTAIN TOTAL | 23,091,965.887 shares 314,935,884 shares 2,292,355.179 shares 25,699,256.950 shares | 89.855% 1.225% 8.920% | |||
Nationwide NVIT Investor Destinations Moderate Fund (Formerly Gartmore GVIT Investor Destinations Moderate Fund) | FOR AGAINST ABSTAIN TOTAL | 188,902,093.059 shares 3,018,924.590 shares 16,359,690.401 shares 208,280,708.050 shares | 90.696% 1.449% 7.855% | |||
Nationwide NVIT Investor Destinations Moderately Aggressive Fund (Formerly Gartmore GVIT Investor Destinations Moderately Aggressive Fund) | FOR AGAINST ABSTAIN TOTAL | 134,792,622.920 shares 3,489,207.264 shares 9,304,197.656 shares 147,586,027.840 shares | 91.332% 2.364% 6.304% | |||
Nationwide NVIT Investor Destinations Moderately Conservative Fund (Formerly Gartmore GVIT Investor Destinations Moderately Conservative Fund) | FOR AGAINST ABSTAIN TOTAL | 49,627,123.216 shares 856,088.634 shares 3,507,215.650 shares 53,990,427.500 shares | 91.918% 1.586% 6.496% | |||
Nationwide NVIT Mid Cap Growth Fund (Formerly Gartmore GVIT Mid Cap Growth Fund) | FOR AGAINST ABSTAIN TOTAL | 10,879,584.971 shares 352,594.958 shares 717,792.971 shares 11,949,972.900 shares | 91.043% 2.950% 6.007% | |||
Nationwide NVIT Money Market Fund II (Formerly Gartmore GVIT Money Market Fund II) | FOR AGAINST ABSTAIN TOTAL | 221,774,863.241 shares 12,322,482.494 shares 16,471,740.875 shares 250,569,086.610 shares | 88.508% 4.918% 6.574% | |||
Nationwide NVIT Money Market Fund (Formerly Gartmore GVIT Money Market Fund) | FOR AGAINST ABSTAIN TOTAL | 1,578,331,008.328 shares 32,372,133.671 shares 112,652,123.301 shares 1,723,355,265.300 shares | 91.585% 1.878% 6.537% | |||
NVIT Nationwide Fund (Formerly Gartmore GVIT Nationwide Fund) | FOR AGAINST ABSTAIN TOTAL | 125,423,274.735 shares 2,767,979.467 shares 8,762,255.828 shares 136,953,510.030 shares | 91.581% 2.021% 6.398% |
Number of Shares | ||||||
Fund | Cast/Not Cast | Percentages | ||||
NVIT Nationwide Leaders Fund (Formerly Gartmore GVIT Nationwide Leaders Fund) | FOR AGAINST ABSTAIN TOTAL | 2,298,504.956 shares 29,630.469 shares 71,637.755 shares 2,399,773.180 shares | 95.780% 1.235% 2.985% | |||
Nationwide NVIT U.S. Growth Leaders Fund (Formerly Gartmore GVIT U.S. Growth Leaders Fund) | FOR AGAINST ABSTAIN TOTAL | 4,972,094.773 shares 122,623.161 shares 174,625.606 shares 5,269,343.540 shares | 94.359% 2.327% 3.314% | |||
Gartmore NVIT Worldwide Leaders Fund (Formerly Gartmore GVIT Worldwide Leaders Fund) | FOR AGAINST ABSTAIN TOTAL | 2,666,862.487 shares 47,702.491 shares 118,719.882 shares 2,833,284.860 shares | 94.126% 1.684% 4.190% | |||
JP Morgan NVIT Balanced Fund (Formerly JP Morgan GVIT Balanced Fund) | FOR AGAINST ABSTAIN TOTAL | 15,966,867.546 shares 259,004.324 shares 1,339,385.200 shares 17,565,257.070 shares | 90.900% 1.475% 7.625% | |||
Van Kampen NVIT Comstock Value Fund (Formerly Van Kampen GVIT Comstock Value Fund) | FOR AGAINST ABSTAIN TOTAL | 27,737,008.009 shares 502,564.164 shares 1,824,670.107 shares 30,064,242.280 shares | 92.259% 1.672% 6.069% | |||
Van Kampen NVIT Multi Sector Bond Fund (Formerly Van Kampen GVIT Multi Sector Bond Fund) | FOR AGAINST ABSTAIN TOTAL | 21,253,297.665 shares 484,100.920 shares 1,803,963.645 shares 23,541,362.230 shares | 90.281% 2.056% 7.663% | |||
At the April 25 Meeting, shareholders of the Nationwide NVIT Mid Cap Growth Fund were also asked to approve a new investment subadvisory agreement among the Adviser, the Trust and NorthPointe Capital LLC. The voting results with respect to that proposal are set forth below:
Proposal 2:
Number of Shares | ||||||
Fund | Cast/Not Cast | Percentages | ||||
Nationwide NVIT Mid Cap Growth Fund (Formerly Gartmore GVIT Mid Cap Growth Fund) | FOR AGAINST ABSTAIN TOTAL | 10,862,827.499 shares 414,574.660 shares 672,570.741 shares 11,949,972.900 shares | 90.903% 3.469% 5.628% | |||
* | This meeting was previously adjourned on April 23, 2007. | |
** | Fund names were changed effective May 1, 2007 to reflect “Nationwide”/“NVIT” branding to coincide with the sale of Nationwide Fund Advisors, Inc. by Nationwide Corporation to its majority-owned subsidiary, Nationwide Financial Services, Inc. |
June 30, 2007 (Unaudited)
Contents | ||
6 | Statement of Investments | |
9 | Statement of Assets and Liabilities | |
10 | Statement of Operations | |
11 | Statements of Changes in Net Assets | |
13 | Financial Highlights | |
14 | Notes to Financial Statements |
Statement Regarding Availability of Proxy Voting Record.
SAR-SCG (8/07) | ![]() |
Dear Fellow Shareholder:
Since I last wrote to you, our mutual funds have enjoyed another period of solid performance, and the corporate realignment that was in progress is now finished.
On May 1, 2007, Nationwide Financial Services, Inc. (NFS), completed its acquisition of the Philadelphia-based retail mutual fund operations of NWD Investment Management, Inc. (formerly, “Gartmore Global Investments, Inc.”), from Nationwide Corporation, a subsidiary of Nationwide Mutual Insurance Company. Effective that date, the acquired entities were renamed Nationwide Funds Group (NFG), and the Gartmore Funds were renamed the Nationwide Funds to better align with the Nationwide® brand. Although the corporate ownership and fund names have changed, I can assure you that NFG intends to maintain as much continuity as possible with the Funds and key personnel.
Thank you, shareholders, for approving the new investment advisory agreement that was required due to the change in corporate ownership. The new agreement is identical in all material respects to the original agreement that it replaces, with the exception of the section pertaining to the vote by the shareholders of the NVIT Mid Cap Growth Fund to approve NorthPointe Capital®, LLC (NorthPointe) as sub-adviser to that particular Fund.
Market Overview: January 1-June 30, 2007
Share prices in general were buoyed in part by better-than-expected first-quarter 2007 earnings and a flurry of mergers and acquisitions, many of these spurred by readily available funding from private equity firms. In June, investors grew more cautious amid surging crude oil prices, a sudden spike in long-term interest rates, and the meltdown of two hedge funds that had exposure to the subprime mortgage market. Looking abroad, a weak U.S. dollar aided foreign stocks, as reflected in the 11.09% advance of the Morgan Stanley Capital International Europe, Australasia and Far East (MSCI EAFE®) Index. Emerging market performance was particularly robust.
The bond market struggled during the first half of 2007. While short-term interest rates remained stable, reflecting the Federal Reserve Board’s decision in June to leave the target federal funds rate at 5.25%, longer-term rates climbed during the first half of 2007, depressing bond prices and forcing the Lehman Brothers® U.S. Aggregate Index to settle for a modest 0.97% return.
We at NFG thank you for your understanding and cooperation throughout our recent transition period. We emerge from this period energized for the future, and we look forward to serving your investment needs for a long time to come.
Nationwide Funds Group
PAST PERFORMANCE IS NO GUARANTEE OF FUTURE RESULTS.
Nationwide Funds are advised by Nationwide Fund Advisors (NFA). NFA is a wholly-owned subsidiary of Nationwide Financial Services. Nationwide Financial Services is a wholly-owned subsidiary of Nationwide Corporation. All of the common stock of Nationwide Corporation is held by Nationwide Mutual (95.2%) and Nationwide Mutual Fire Insurance Company (4.8%), each of which is a mutual company owned by its policyholders.
Nationwide Funds Group (NFG) is the mutual fund arm of Nationwide Financial Services (NYSE: NFS). Based in Conshohocken, Pa., a suburb of Philadelphia, NFG is comprised of Nationwide Fund Advisors, Nationwide Fund Distributors, LLC, and Nationwide Fund Management, LLC. Together, these provide advisory, distribution, and administration services respectively to the Nationwide Funds, and manage more than $43.5 billion in assets as of June 30, 2007, of which more than $12 billion are in “fund of funds” designed to provide asset allocation across several types of investments and asset classes.
Lehman Brothers (LB) U.S. Aggregate Index: An unmanaged, market value-weighted index of investment-grade, fixed-rate debt issues (including government, corporate, asset-backed, and mortgage-backed securities with maturities of one year or more) that is generally representative of the bond market as a whole.
Morgan Stanley Capital International Europe, Australasia and Far East (MSCI EAFE®) Index: An unmanaged, free float-adjusted, market capitalization-weighted index that is designed to measure the performance of stocks in developed markets outside the United States and Canada.
Standard & Poor’s 500® (S&P 500) Index: An unmanaged, market capitalization-weighted index of 500 widely held stocks of large-cap U.S. companies that gives a broad look at how the stock prices of those companies have performed.
Views expressed within are those of Nationwide Funds Group as of the date noted, are subject to change at any time, and may not come to pass.
This report is for informational purposes only, and is not intended as an offer or recommendation with respect to the purchase or sale of any security, option, future, or other derivatives in such securities.
Investing in mutual funds involves risk, including possible loss of principal.
Investors should carefully consider a fund’s investment objectives, risks, fees, charges, and expenses before investing any money. To obtain this and other fund information, please call 800-848-0920 to request a prospectus, or download a prospectus at www.nationwidefunds.com. Please read the prospectus carefully before investing any money.
Nationwide Funds distributed by Nationwide Fund Distributors LLC (formerly Gartmore Distribution Services, Inc.), Member NASD. 1200 River Road, Suite 1000, Conshohocken, Pa. 19428.
As a shareholder of the Fund, you incur two types of costs: (1) transaction costs, including sales charges (loads) paid on purchase payments and redemption fees; and (2) ongoing costs, including investment advisory fees, administration fees, distribution fees and other Fund expenses. The examples below are 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. Per SEC requirements, the examples assume that you had a $1,000 investment in the Class at the beginning of the reporting period, January 1, 2007, and continued to hold your shares at the end of the reporting period, June 30, 2007.
Actual Expenses
Hypothetical Example for Comparison Purposes
Please note that the expenses shown in the table are meant to highlight your ongoing costs only and do not reflect any transaction costs, such as sales charges (loads) or redemption fees. Therefore, the second line for each Class in 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 transaction costs were included, your costs would have been higher. The examples also assume all dividends and distributions have been reinvested.
Schedule of Shareholder Expenses
Nationwide Multi-Manager NVIT Small Cap Growth | ||||||||||||||||||||||
Ending | ||||||||||||||||||||||
Beginning, | Account | |||||||||||||||||||||
Account Value, | Value, | Expenses Paid | Annualized | |||||||||||||||||||
January 1, 2007 | June 30, 2007 | During Period* | Expense Ratio* | |||||||||||||||||||
Class I | Actual | $ | 1,000.00 | $ | 1,093.20 | $ | 6.33 | 1.22% | ||||||||||||||
Hypothetical | 1 | $ | 1,000.00 | $ | 1,018.75 | $ | 6.12 | 1.22% | ||||||||||||||
Class II | Actual | $ | 1,000.00 | $ | 1,091.90 | $ | 7.62 | 1.47% | ||||||||||||||
Hypothetical | 1 | $ | 1,000.00 | $ | 1,017.51 | $ | 7.38 | 1.47% | ||||||||||||||
Class III | Actual | $ | 1,000.00 | $ | 1,093.80 | $ | 6.28 | 1.21% | ||||||||||||||
Hypothetical | 1 | $ | 1,000.00 | $ | 1,018.80 | $ | 6.07 | 1.21% | ||||||||||||||
* | Expenses are equal to the Fund’s annualized expense ratio multiplied by the average account value over the period multiplied by 181/365 (to reflect the one-half year period). The expense ratio presented represents a six-month, annualized ratio in accordance with SEC guidelines. The expenses reported above do not include the effect of additional expenses imposed by variable annuity contracts. | |
1 | Represents the hypothetical 5% return before expenses. |
The SEC adopted a requirement that Funds present their portfolio holdings in a table, chart or graph format in their annual and semiannual reports to shareholders, whether or not a statement of investments is utilized. The following tables, which present portfolio holdings as a percentage of net assets, are provided in compliance with this requirement.
Asset Allocation | ||||
Common Stock | 93.6% | |||
Repurchase Agreements | 6.3% | |||
Other Investments* | 23.9% | |||
Liabilities in excess of other assets** | -23.8% | |||
100.0% |
Top Industries | ||||
Software | 10.9% | |||
Internet Software & Services | 9.8% | |||
Health Care Technology | 6.2% | |||
Health Care Providers & Services | 4.3% | |||
Health Care Equipment & Supplies | 4.2% | |||
Semiconductors & Semiconductor Equipment | 4.2% | |||
Hotels, Restaurants & Leisure | 3.9% | |||
Communications Equipment | 3.6% | |||
Specialty Retail | 3.3% | |||
Oil, Gas & Consumable Fuels | 3.1% | |||
Other | 46.5% | |||
100.0% |
Top Holdings*** | ||||
Allscripts Healthcare Solutions, Inc. | 2.3% | |||
Focus Media Holding Ltd. ADR | 2.2% | |||
Blackboard, Inc. | 2.0% | |||
Kyphon, Inc. | 2.0% | |||
Healthways, Inc. | 1.9% | |||
ITT Educational Services, Inc. | 1.8% | |||
Gaylord Entertainment Co. | 1.7% | |||
Chicago Bridge & Iron Co. | 1.6% | |||
Bucyrus International, Inc. | 1.6% | |||
Novatel Wireless, Inc. | 1.5% | |||
Other | 81.4% | |||
100.0% |
* | Includes value of collateral received from securities lending. |
** | Includes value of collateral owed from securities lending. |
*** | For purpose of listing top holdings, repurchase agreements are included as part of Other. |
Nationwide Multi-Manager NVIT Small Cap Growth Fund
Common Stock (93.6%) | ||||||||
Shares or | ||||||||
Principal Amount | Value | |||||||
Aerospace & Defense (1.4%) | ||||||||
Ceradyne, Inc.* | 12,966 | $ | 958,965 | |||||
EDO Corp. | 32,800 | 1,078,136 | ||||||
2,037,101 | ||||||||
Auto Components (1.6%) | ||||||||
LKQ Corp.* | 64,594 | 1,592,888 | ||||||
Spartan Motors, Inc. | 39,900 | 679,098 | ||||||
2,271,986 | ||||||||
Biotechnology (0.6%) | ||||||||
FEI Co.* | 25,700 | 834,222 | ||||||
834,222 | ||||||||
Capital Markets (0.4%) | ||||||||
FCStone Group, Inc.* | 10,000 | 573,100 | ||||||
573,100 | ||||||||
Chemicals (0.9%) | ||||||||
Zoltek Cos., Inc.* | 31,300 | 1,299,889 | ||||||
1,299,889 | ||||||||
Commercial Services & Supplies (2.2%) | ||||||||
CoStar Group, Inc.* | 16,900 | 893,672 | ||||||
Kenexa Corp.* | 34,200 | 1,289,682 | ||||||
Mobile Mini, Inc.* | 33,000 | 963,600 | ||||||
3,146,954 | ||||||||
Communications Equipment (3.6%) | ||||||||
Acme Packet, Inc.* | 70,419 | 809,114 | ||||||
Bigband Networks, Inc.* | 38,100 | 499,491 | ||||||
Comtech Group, Inc.* | 47,600 | 785,876 | ||||||
Interactive Intelligence, Inc.* | 19,500 | 401,700 | ||||||
Oplink Communications, Inc.* | 60,200 | 903,000 | ||||||
OpNext, Inc.* | 50,300 | 665,972 | ||||||
Optium Corp.* | 33,600 | 425,040 | ||||||
Riverbed Technology, Inc.* | 12,000 | 525,840 | ||||||
5,016,033 | ||||||||
Computers & Peripherals (1.1%) | ||||||||
Synaptics, Inc.* | 42,900 | 1,535,391 | ||||||
1,535,391 | ||||||||
Construction & Engineering (2.3%) | ||||||||
Chicago Bridge & Iron Co. | 59,300 | 2,237,982 | ||||||
Desarrolladora Homex SA de CV ADR — MX* | 15,847 | 960,170 | ||||||
3,198,152 | ||||||||
Diversified Consumer Services (2.4%) | ||||||||
ITT Educational Services, Inc.* | 22,400 | 2,629,312 | ||||||
Sotheby’s Holdings, Inc. | 17,400 | 800,748 | ||||||
3,430,060 | ||||||||
Diversified Financial Services (0.9%) | ||||||||
Financial Federal Corp. | 40,775 | 1,215,911 | ||||||
1,215,911 | ||||||||
Electronic Equipment & Instruments (1.3%) | ||||||||
DTS, Inc.* | 25,900 | 563,843 | ||||||
IPG Photonics Corp.* | 34,600 | 690,270 | ||||||
Mellanox Technologies Ltd.* | 28,600 | 592,592 | ||||||
1,846,705 | ||||||||
Energy Equipment & Services (1.5%) | ||||||||
Allis-Chalmers Energy, Inc.* | 26,900 | 618,431 | ||||||
Drill-Quip, Inc.* | 14,600 | 656,270 | ||||||
Hercules Offshore, Inc.* | 24,100 | 780,358 | ||||||
2,055,059 | ||||||||
Food & Staples Retailing (1.5%) | ||||||||
Central European Distribution Corp.* | 42,250 | 1,462,695 | ||||||
United Natural Foods, Inc.* | 24,100 | 640,578 | ||||||
2,103,273 | ||||||||
Food Products (0.3%) | ||||||||
SunOpta, Inc.* | 31,300 | 348,995 | ||||||
348,995 | ||||||||
Health Care Equipment & Supplies (4.2%) | ||||||||
Accuray, Inc.* | 29,900 | 663,182 | ||||||
Cynosure, Inc.* | 29,500 | 1,074,685 | ||||||
Kyphon, Inc.* | 57,590 | 2,772,958 | ||||||
LifeCell Corp.* | 33,100 | 1,010,874 | ||||||
Natus Medical, Inc.* | 28,700 | 456,904 | ||||||
5,978,603 | ||||||||
Health Care Providers & Services (4.3%) | ||||||||
HealthExtras, Inc.* | 38,600 | 1,141,788 | ||||||
Healthways, Inc.* | 58,123 | 2,753,287 | ||||||
InVentiv Health, Inc.* | 10,171 | 372,360 | ||||||
LHC Group, Inc.* | 26,200 | 686,440 | ||||||
Nighthawk Radiology Holdings, Inc.* | 38,600 | 696,730 | ||||||
Visicu, Inc.* | 50,200 | 459,330 | ||||||
6,109,935 | ||||||||
Common Stocks (continued) | ||||||||
Shares or | ||||||||
Principal Amount | Value | |||||||
Health Care Technology (6.2%) | ||||||||
Allscripts Healthcare Solutions, Inc.* | 128,754 | $ | 3,280,652 | |||||
Cerner Corp.* | 36,900 | 2,046,843 | ||||||
Omicell, Inc.* | 58,300 | 1,211,474 | ||||||
Systems Xcellence, Inc.* | 35,235 | 1,013,711 | ||||||
Vital Images, Inc.* | 43,200 | 1,173,312 | ||||||
8,725,992 | ||||||||
Hotels, Restaurants & Leisure (3.9%) | ||||||||
Chipotle Mexican Grill, Inc.* | 2,800 | 238,784 | ||||||
Gaylord Entertainment Co.* | 43,800 | 2,349,432 | ||||||
Scientific Games Corp.* | 53,800 | 1,880,310 | ||||||
Vail Resorts, Inc.* | 15,700 | 955,659 | ||||||
5,424,185 | ||||||||
Insurance (0.7%) | ||||||||
eHealth, Inc.* | 22,900 | 437,161 | ||||||
Security Capital Assurance Ltd. | 17,100 | 527,877 | ||||||
965,038 | ||||||||
Internet & Catalog Retail (2.8%) | ||||||||
Knot, Inc. (The)* | 63,800 | 1,288,122 | ||||||
SINA Corp.* | 33,000 | 1,381,380 | ||||||
Stamps.com, Inc.* | 46,300 | 638,014 | ||||||
VistaPrint Ltd. — BR* | 16,500 | 631,125 | ||||||
3,938,641 | ||||||||
Internet Software & Services (9.8%) | ||||||||
aQuantive, Inc.* | 23,000 | 1,467,400 | ||||||
Bankrate, Inc.* | 21,200 | 1,015,904 | ||||||
Comscore, Inc.* | 3,700 | 85,655 | ||||||
Dealertrack Holdings, Inc.* | 54,300 | 2,000,412 | ||||||
DivX, Inc.* | 34,700 | 520,500 | ||||||
Gmarket, Inc. ADR — KR* | 42,100 | 818,003 | ||||||
Liquidity Services, Inc.* | 38,700 | 726,786 | ||||||
Loopnet, Inc.* | 84,500 | 1,971,385 | ||||||
Opsware, Inc.* | 77,700 | 738,927 | ||||||
Perficient, Inc.* | 40,400 | 836,280 | ||||||
Smith Micro Software, Inc.* | 46,100 | 694,266 | ||||||
Synchronoss Technologies, Inc.* | 27,100 | 795,114 | ||||||
ValueClick, Inc.* | 57,349 | 1,689,502 | ||||||
Vocus, Inc.* | 19,700 | 494,667 | ||||||
13,854,801 | ||||||||
IT Services (1.1%) | ||||||||
CheckFree Corp.* | 16,506 | 663,541 | ||||||
Exlservice Holdings, Inc.* | 49,800 | 933,252 | ||||||
1,596,793 | ||||||||
Machinery (2.3%) | ||||||||
Bucyrus International, Inc., Class A | 31,100 | 2,201,258 | ||||||
Dynamic Materials Corp. | 20,500 | 768,750 | ||||||
Kadant, Inc.* | 7,400 | 230,880 | ||||||
3,200,888 | ||||||||
Media (2.2%) | ||||||||
Focus Media Holding Ltd. ADR* | 61,954 | 3,128,677 | ||||||
3,128,677 | ||||||||
Metals & Mining (0.3%) | ||||||||
Brush Engineered Materials, Inc.* | 11,300 | 474,487 | ||||||
474,487 | ||||||||
Oil, Gas & Consumable Fuels (3.1%) | ||||||||
Arena Resources, Inc.* | 6,100 | 354,471 | ||||||
Bill Barrett Corp.* | 43,800 | 1,613,154 | ||||||
Carrizo Oil & Gas, Inc.* | 32,334 | 1,340,891 | ||||||
GMX Resources, Inc.* | 4,800 | 166,080 | ||||||
Newfield Exploration Co.* | 21,000 | 956,550 | ||||||
4,431,146 | ||||||||
Other Financial (0.2%) | ||||||||
Pinnacle Financial Partners, Inc.* | 11,300 | 331,768 | ||||||
331,768 | ||||||||
Personal Products (0.7%) | ||||||||
Bare Escentuals, Inc.* | 28,800 | 983,520 | ||||||
983,520 | ||||||||
Pharmaceuticals (3.1%) | ||||||||
Adams Respiratory Therapeutics, Inc.* | 22,800 | 898,092 | ||||||
Obagi Medical Products, Inc.* | 50,600 | 896,632 | ||||||
Omrix Biopharmaceuticals, Inc.* | 34,745 | 1,093,078 | ||||||
Salix Pharmaceuticals, Inc.* | 56,008 | 688,898 | ||||||
Sciele Pharma, Inc.* | 35,248 | 830,443 | ||||||
4,407,143 | ||||||||
Road & Rail (2.9%) | ||||||||
J.B. Hunt Transport Services, Inc. | 67,800 | 1,987,896 | ||||||
Kansas City Southern Industries, Inc.* | 53,950 | 2,025,283 | ||||||
4,013,179 | ||||||||
Nationwide Multi-Manager NVIT Small Cap Growth Fund (Continued)
Common Stocks (continued) | ||||||||
Shares or | ||||||||
Principal Amount | Value | |||||||
Semiconductors & Semiconductor Equipment (4.2%) | ||||||||
Atheros Communications* | 62,900 | $ | 1,939,836 | |||||
Sigma Designs, Inc.* | 54,800 | 1,429,732 | ||||||
Tessera Technologies, Inc.* | 37,844 | 1,534,574 | ||||||
Trident Microsystems, Inc.* | 55,500 | 1,018,425 | ||||||
5,922,567 | ||||||||
Software (10.9%) | ||||||||
Blackbaud, Inc. | 96,800 | 2,137,344 | ||||||
Blackboard, Inc.* | 66,100 | 2,784,132 | ||||||
Concur Technologies, Inc.* | 66,900 | 1,528,665 | ||||||
Double-Take Software, Inc.* | 11,800 | 193,638 | ||||||
EPIQ Systems, Inc.* | 56,115 | 906,819 | ||||||
FactSet Research Systems, Inc. | 29,575 | 2,021,451 | ||||||
Falconstor Software, Inc.* | 88,000 | 928,400 | ||||||
Innerworkings, Inc.* | 79,300 | 1,270,386 | ||||||
MICROS Systems, Inc.* | 23,100 | 1,256,640 | ||||||
Sourcefire, Inc.* | 46,000 | 643,540 | ||||||
Vasco Data Security International, Inc.* | 74,500 | 1,695,620 | ||||||
15,366,635 | ||||||||
Specialty Retail (3.3%) | ||||||||
Citi Trends, Inc.* | 26,900 | 1,021,124 | ||||||
O’Reilly Automotive, Inc.* | 50,600 | 1,849,430 | ||||||
Zumiez, Inc.* | 47,400 | 1,790,772 | ||||||
4,661,326 | ||||||||
Textiles, Apparel & Luxury Goods (2.6%) | ||||||||
Heelys, Inc.* | 55,500 | 1,435,230 | ||||||
Iconix Brand Group, Inc.* | 45,100 | 1,002,122 | ||||||
Volcom, Inc.* | 24,800 | 1,243,224 | ||||||
3,680,576 | ||||||||
Wireless Telecommunication Services (2.8%) | ||||||||
Novatel Wireless, Inc.* | 82,200 | 2,138,844 | ||||||
Sierra Wireless, Inc.* | 74,100 | 1,844,349 | ||||||
3,983,193 | ||||||||
Total Common Stocks (Cost $97,114,910) | 132,091,924 | |||||||
Repurchase Agreements (6.3%) | ||||||||
Nomura Securities, 5.20%, dated 06/29/07, due 07/02/07, repurchase price $8,882,450, collateralized by U.S. Government Agency Mortgages with a market value of $9,056,175 | $ | 8,878,603 | 8,878,603 | |||||
Securities Held as Collateral for Securities on Loan (23.9%) | ||||||||
Morgan Stanley Repurchase Agreement, 5.42%, dated 06/29/07, due 07/02/07, repurchase price $33,733,700, collateralized by U.S. Government Agency Mortgages with a market value of $34,392,839 | 33,718,470 | 33,718,470 | ||||||
Total Investments (Cost $139,711,983) (a) — 123.8% | 174,688,997 | |||||||
Liabilities in excess of other assets — (23.8)% | (33,632,692 | ) | ||||||
NET ASSETS — 100.0% | $ | 141,056,305 | ||||||
* | Denotes a non-income producing security. | |
(a) | See notes to financial statements for tax unrealized appreciation (depreciation) of securities. |
ADR | American Depository Receipt | |
BR | Brazil | |
KR | Korea | |
MX | Mexico |
See accompanying notes to financial statements
Nationwide | ||||||
Multi-Manager | ||||||
NVIT Small Cap | ||||||
Growth Fund | ||||||
Assets: | ||||||
Investments, at value (cost $97,114,910)* | $ | 132,091,924 | ||||
Repurchase agreements, at cost and value | 42,597,073 | |||||
Total Investments | 174,688,997 | |||||
Cash | 356 | |||||
Interest and dividends receivable | 49,495 | |||||
Receivable for capital shares issued | 7,796 | |||||
Receivable for investments sold | 514,415 | |||||
Prepaid expenses | 245 | |||||
Total Assets | 175,261,304 | |||||
Liabilities: | ||||||
Payable for investments purchased | 252,182 | |||||
Payable upon return of securities loaned | 33,718,470 | |||||
Payable for capital shares redeemed | 57,363 | |||||
Accrued expenses and other payables: | ||||||
Investment advisory fees | 110,721 | |||||
Fund administration and transfer agent fees | 8,881 | |||||
Distribution fees | 4,275 | |||||
Administrative servicing fees | 15,398 | |||||
Compliance program costs | 1,855 | |||||
Other | 35,854 | |||||
Total Liabilities | 34,204,999 | |||||
Net Assets | $ | 141,056,305 | ||||
Represented by: | ||||||
Capital | $ | 126,068,955 | ||||
Accumulated net investment loss | (611,340 | ) | ||||
Accumulated net realized losses from investment transactions | (19,378,324 | ) | ||||
Net unrealized appreciation on investments | 34,977,014 | |||||
Net Assets | $ | 141,056,305 | ||||
Net Assets: | ||||||
Class I Shares | $ | 119,628,832 | ||||
Class II Shares | 20,751,328 | |||||
Class III Shares | 676,145 | |||||
Total | $ | 141,056,305 | ||||
Shares outstanding (unlimited number of shares authorized): | ||||||
Class I Shares | 6,667,397 | |||||
Class II Shares | 1,172,149 | |||||
Class III Shares | 37,903 | |||||
Total | 7,877,449 | |||||
Net asset value and offering price per share (Net assets by class divided by shares outstanding by class, respectively.): | ||||||
Class I Shares | $ | 17.94 | ||||
Class II Shares | $ | 17.70 | ||||
Class III Shares | $ | 17.84 | ||||
* | Includes value of securities on loan of $32,992,636. |
9
Nationwide Multi- | |||||
Manager NVIT Small | |||||
Cap Growth Fund | |||||
INVESTMENT INCOME: | |||||
Interest income | $ | 128,695 | |||
Dividend income | 85,432 | ||||
Income from securities lending | 35,890 | ||||
Total Income | 250,017 | ||||
Expenses: | |||||
Investment advisory fees | 650,515 | ||||
Fund administration and transfer agent fees | 43,270 | ||||
Distribution fees Class II Shares | 24,289 | ||||
Administrative servicing fees Class I Shares | 82,054 | ||||
Administrative servicing fees Class II Shares | 13,721 | ||||
Administrative servicing fees Class III Shares | 409 | ||||
Custodian fees | 11,758 | ||||
Trustee fees | 3,953 | ||||
Compliance program costs (Note 3) | 971 | ||||
Other | 31,694 | ||||
Total expenses before earnings credit | 862,634 | ||||
Earnings credit (Note 6) | (1,277 | ) | |||
Net Expenses | 861,357 | ||||
Net Investment Loss | (611,340 | ) | |||
REALIZED/ UNREALIZED GAINS (LOSSES) FROM INVESTMENTS: | |||||
Net realized gains on investment transactions | 10,701,895 | ||||
Net change in unrealized appreciation on investments | 2,392,893 | ||||
Net realized/unrealized gains (losses) on investments | 13,094,788 | ||||
CHANGE IN NET ASSETS RESULTING FROM OPERATIONS | $ | 12,483,448 | |||
10
Nationwide Multi-Manager NVIT | |||||||||
Small Cap Growth Fund | |||||||||
Six Months Ended | Year Ended | ||||||||
June 30, 2007 | December 31, 2006 | ||||||||
(Unaudited) | |||||||||
FROM INVESTMENT ACTIVITIES: | |||||||||
Operations: | |||||||||
Net investment loss | $ | (611,340 | ) | $ | (1,298,323 | ) | |||
Net realized gains on investment transactions | 10,701,895 | 14,376,742 | |||||||
Net change in unrealized appreciation/depreciation on investments | 2,392,893 | (8,951,318 | ) | ||||||
Change in net assets resulting from operations | 12,483,448 | 4,127,101 | |||||||
Change in net assets from capital transactions | (14,912,890 | ) | (22,679,718 | ) | |||||
Change in net assets | (2,429,442 | ) | (18,552,617 | ) | |||||
Net Assets: | |||||||||
Beginning of period | 143,485,747 | 162,038,364 | |||||||
End of period | $ | 141,056,305 | $ | 143,485,747 | |||||
Accumulated net investment income (loss) at end of period | $ | (611,340 | ) | $ | – | ||||
CAPITAL TRANSACTIONS: | |||||||||
Class I Shares | |||||||||
Proceeds from shares issued | $ | 12,652,949 | $ | 33,464,997 | |||||
Cost of shares redeemed(a) | (27,473,474 | ) | (55,081,579 | ) | |||||
(14,820,525 | ) | (21,616,582 | ) | ||||||
Class II Shares | |||||||||
Proceeds from shares issued | 1,951,984 | 6,124,785 | |||||||
Cost of shares redeemed(a) | (1,996,303 | ) | (7,000,356 | ) | |||||
(44,319 | ) | (875,571 | ) | ||||||
Class III Shares | |||||||||
Proceeds from shares issued | 26,447 | 250,844 | |||||||
Cost of shares redeemed(a) | (74,493 | ) | (438,409 | ) | |||||
(48,046 | ) | (187,565 | ) | ||||||
Change in net assets from capital transactions | $ | (14,912,890 | ) | $ | (22,679,718 | ) | |||
11
Nationwide Multi-Manager NVIT | |||||||||
Small Cap Growth Fund | |||||||||
Six Months Ended | Year Ended | ||||||||
June 30, 2007 | December 31, 2006 | ||||||||
(Unaudited) | |||||||||
SHARE TRANSACTIONS: | |||||||||
Class I Shares | |||||||||
Issued | 742,552 | 2,079,218 | |||||||
Redeemed | (1,619,508 | ) | (3,448,232 | ) | |||||
(876,956 | ) | (1,369,014 | ) | ||||||
Class II Shares | |||||||||
Issued | 116,338 | 378,616 | |||||||
Redeemed | (119,425 | ) | (443,345 | ) | |||||
(3,087 | ) | (64,729 | ) | ||||||
Class III Shares | |||||||||
Issued | 1,576 | 15,454 | |||||||
Redeemed | (4,562 | ) | (27,259 | ) | |||||
(2,986 | ) | (11,805 | ) | ||||||
Total change in shares | (883,029 | ) | (1,445,548 | ) | |||||
(a) | Includes redemption fees, if any. |
12
Ratios/Supplemental Data | ||||||||||||||||||||||||||||||||
Investment Activities | ||||||||||||||||||||||||||||||||
Net Realized | ||||||||||||||||||||||||||||||||
and | ||||||||||||||||||||||||||||||||
Net Asset | Net | Unrealized | Total | Net Assets | Ratio of | |||||||||||||||||||||||||||
Value, | Investment | Gains | from | Net Asset | at End of | Expenses | ||||||||||||||||||||||||||
Beginning | Income | (Losses) on | Investment | Value, End | Total | Period | to Average | |||||||||||||||||||||||||
of Period | (Loss) | Investments | Activities | of Period | Return (a) | (000s) | Net Assets (b) | |||||||||||||||||||||||||
Class I Shares | ||||||||||||||||||||||||||||||||
For the year ended December 31, 2002 | $ | 14.48 | (0.11 | ) | (4.71 | ) | (4.82 | ) | $ | 9.66 | (33.29% | ) | $ | 100,308 | 1.35% | |||||||||||||||||
For the year ended December 31, 2003 | $ | 9.66 | (0.11 | ) | 3.42 | 3.31 | $ | 12.97 | 34.27% | $ | 156,978 | 1.34% | ||||||||||||||||||||
For the year ended December 31, 2004 | $ | 12.97 | (0.12 | ) | 1.86 | 1.74 | $ | 14.71 | 13.42% | $ | 156,535 | 1.21% | ||||||||||||||||||||
For the year ended December 31, 2005 | $ | 14.71 | (0.13 | ) | 1.32 | 1.19 | $ | 15.90 | 8.09% | $ | 141,684 | 1.22% | ||||||||||||||||||||
For the year ended December 31, 2006 | $ | 15.90 | (0.14 | ) | 0.65 | 0.51 | $ | 16.41 | 3.21% | $ | 123,771 | 1.25% | ||||||||||||||||||||
For the six months ended June 30, 2007 (Unaudited) | $ | 16.41 | (0.08 | ) | 1.61 | 1.53 | $ | 17.94 | 9.32% | $ | 119,629 | 1.22% | ||||||||||||||||||||
Class II Shares | ||||||||||||||||||||||||||||||||
Period ended December 31, 2002 (e) | $ | 13.59 | (0.04 | ) | (3.92 | ) | (3.96 | ) | $ | 9.63 | (29.14% | ) | $ | 1,652 | 1.63% | |||||||||||||||||
For the year ended December 31, 2003 | $ | 9.63 | (0.09 | ) | 3.37 | 3.28 | $ | 12.91 | 34.06% | $ | 8,842 | 1.59% | ||||||||||||||||||||
For the year ended December 31, 2004 | $ | 12.91 | (0.12 | ) | 1.82 | 1.70 | $ | 14.61 | 13.17% | $ | 15,917 | 1.47% | ||||||||||||||||||||
For the year ended December 31, 2005 | $ | 14.61 | (0.14 | ) | 1.27 | 1.13 | $ | 15.74 | 7.73% | $ | 19,521 | 1.46% | ||||||||||||||||||||
For the year ended December 31, 2006 | $ | 15.74 | (0.18 | ) | 0.65 | 0.47 | $ | 16.21 | 2.99% | $ | 19,047 | 1.51% | ||||||||||||||||||||
For the six months ended June 30, 2007 (Unaudited) | $ | 16.21 | (0.09 | ) | 1.58 | 1.49 | $ | 17.70 | 9.19% | $ | 20,751 | 1.47% | ||||||||||||||||||||
Class III Shares | ||||||||||||||||||||||||||||||||
Period ended December 31, 2002 (f) | $ | 10.95 | (0.04 | ) | (1.29 | ) | (1.33 | ) | $ | 9.62 | (12.15% | ) | $ | 17 | 1.27% | |||||||||||||||||
For the year ended December 31, 2003 | $ | 9.62 | (0.05 | ) | 3.33 | 3.28 | $ | 12.90 | 34.10% | $ | 978 | 1.34% | ||||||||||||||||||||
For the year ended December 31, 2004 | $ | 12.90 | (0.14 | ) | 1.87 | 1.73 | $ | 14.63 | 13.41% | $ | 996 | 1.21% | ||||||||||||||||||||
For the year ended December 31, 2005 | $ | 14.63 | (0.14 | ) | 1.31 | 1.17 | $ | 15.80 | 8.00% | $ | 833 | 1.23% | ||||||||||||||||||||
For the year ended December 31, 2006 | $ | 15.80 | (0.16 | ) | 0.67 | 0.51 | $ | 16.31 | 3.23% | $ | 667 | 1.24% | ||||||||||||||||||||
For the six months ended June 30, 2007 (Unaudited) | $ | 16.31 | (0.07 | ) | 1.60 | 1.53 | $ | 17.84 | 9.38% | $ | 676 | 1.21% | ||||||||||||||||||||
[Additional columns below]
[Continued from above table, first column(s) repeated]
Ratios/Supplemental Data | ||||||||||||||||||
Ratio of | ||||||||||||||||||
Ratio of | Ratio of | Investment | ||||||||||||||||
Net | Expenses | Income (Loss) | ||||||||||||||||
Investment | (Prior to | (Prior to | ||||||||||||||||
Income (Loss) | Reimbursements) | Reimbursements) | ||||||||||||||||
to Average | to Average | to Average | Portfolio | |||||||||||||||
Net Assets (b) | Net Assets (b)(c) | Net Assets (b)(c) | Turnover (d) | |||||||||||||||
Class I Shares | ||||||||||||||||||
For the year ended December 31, 2002 | (1.03% | ) | 1.35% | (1.03% | ) | 165.97% | ||||||||||||
For the year ended December 31, 2003 | (1.03% | ) | (g) | (g) | 121.69% | |||||||||||||
For the year ended December 31, 2004 | (0.90% | ) | (g) | (g) | 112.22% | |||||||||||||
For the year ended December 31, 2005 | (0.83% | ) | (g) | (g) | 58.28% | |||||||||||||
For the year ended December 31, 2006 | (0.81% | ) | (g) | (g) | 58.45% | |||||||||||||
For the six months ended June 30, 2007 (Unaudited) | (0.86% | ) | 1.22% | (0.86% | ) | 35.95% | ||||||||||||
Class II Shares | ||||||||||||||||||
Period ended December 31, 2002 (e) | (1.33% | ) | (g) | (g) | 165.97% | |||||||||||||
For the year ended December 31, 2003 | (1.29% | ) | (g) | (g) | 121.69% | |||||||||||||
For the year ended December 31, 2004 | (1.16% | ) | (g) | (g) | 112.22% | |||||||||||||
For the year ended December 31, 2005 | (1.08% | ) | (g) | (g) | 58.28% | |||||||||||||
For the year ended December 31, 2006 | (1.07% | ) | (g) | (g) | 58.45% | |||||||||||||
For the six months ended June 30, 2007 (Unaudited) | (1.10% | ) | 1.47% | (1.10% | ) | 35.95% | ||||||||||||
Class III Shares | ||||||||||||||||||
Period ended December 31, 2002 (f) | (0.94% | ) | (g) | (g) | 165.97% | |||||||||||||
For the year ended December 31, 2003 | (1.04% | ) | (g) | (g) | 121.69% | |||||||||||||
For the year ended December 31, 2004 | (0.91% | ) | (g) | (g) | 112.22% | |||||||||||||
For the year ended December 31, 2005 | (0.84% | ) | (g) | (g) | 58.28% | |||||||||||||
For the year ended December 31, 2006 | (0.80% | ) | (g) | (g) | 58.45% | |||||||||||||
For the six months ended June 30, 2007 (Unaudited) | (0.84% | ) | 1.21% | (0.84% | ) | 35.95% | ||||||||||||
(a) | Not annualized for periods less than one year. | |
(b) | Annualized for periods less than one year. | |
(c) | During the period, certain fees were waived and/or reimbursed. If such waivers/reimbursements had not occurred, the ratios would have been as indicated. | |
(d) | Portfolio turnover is calculated on the basis of the Fund as a whole without distinguishing among the classes of shares. | |
(e) | For the period from March 7, 2002 (commencement of operations) through December 31, 2002. | |
(f) | For the period from July 5, 2002 (commencement of operations) through December 31, 2002. | |
(g) | There were no fee waivers/reimbursements during the period. |
See accompanying notes to financial statements.
1. Organization
Nationwide Variable Insurance Trust (“NVIT” or the “Trust”) is an open-end management investment company, organized under the laws of Delaware by an amended and restated Agreement and Declaration of Trust, dated October 28, 2004, as amended to date. Prior to May 1, 2007, the Trust was named “Gartmore Variable Insurance Trust”. The Trust, originally created under the laws of Massachusetts as a Massachusetts business trust pursuant to a Declaration of Trust dated, as of June 30, 1981, and as subsequently amended, redomesticated as a Delaware Statutory Trust after the close of trading on April 29, 2005, and is registered under the Investment Company Act of 1940, as amended (the “1940 Act”). The redomestication was a change in statutory status and did not affect the operations of the Trust. As of June 30, 2007, the Trust had authorized an unlimited number of shares of beneficial interest, without par value (“shares”). The Trust currently offers shares to life insurance company separate accounts to fund the benefits under variable life insurance or annuity policies. To date, only the separate accounts of Nationwide Life Insurance Company and Nationwide Life and Annuity Insurance Company (collectively, “Nationwide”) have purchased shares of the Nationwide Multi-Manager NVIT Small Cap Growth Fund (the “Fund”), (formerly, “GVIT Small Cap Growth Fund”). The Trust currently operates forty (40) separate series, or mutual funds, each with its own investment objectives and strategies. This report contains the financial statements and financial highlights of the Fund.
2. Summary of Significant Accounting Policies
The following is a summary of significant accounting policies followed by the Fund in the preparation of its financial statements. The policies are in conformity with accounting principles generally accepted in the United States of America (“GAAP”). The preparation of financial statements requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of income and expenses for the period. Actual results could differ from those estimates.
(a) | Security Valuation |
Securities for which market quotations are readily available are valued at current market value as of “Valuation Time.” Valuation Time is as of the close of regular trading on the New York Stock Exchange (usually 4 p.m. Eastern time). Equity securities are valued at the last quoted sale price or, if there is no sale price, the last quoted bid price provided by an independent pricing service approved by the Trust’s Board of Trustees (“Board of Trustees”). Securities traded on NASDAQ are valued at the NASDAQ official closing price. Prices are taken from the primary market or exchange in which each security trades. | |
Most securities listed on a foreign exchange are valued either at fair value (see description below) or at the last sale price at the close of the exchange on which the security is principally traded. Foreign securities, currencies, and other assets and liabilities denominated in foreign currencies are translated into U.S. dollars at the exchange rate of said currencies against the U.S. dollar, as of Valuation Time, as provided by an independent pricing service approved by the Board of Trustees. | |
Debt (including defaulted issues) and other fixed income securities (other than short-term obligations) are valued at the last quoted bid price and/or by using a combination of daily quotes and matrix evaluations provided by an independent pricing service, the use of which has been approved by the Board of Trustees. Short-term debt securities, such as commercial paper and U.S. Treasury Bills having a remaining maturity of 60 days or less at the time of purchase, are considered to be “short-term” and are valued at amortized cost, which approximates market value. | |
Securities for which market quotations are not readily available, or for which an independent pricing service does not provide a value or provides a value that does not represent fair value in the judgment of the Fund’s investment adviser or designee, are valued at fair value under procedures approved by the Board of Trustees. The “Fair Value” of these securities is determined in good faith by taking into account relevant factors and surrounding circumstances. Methods utilized to obtain a “Fair Value” may include the following non-exclusive list of acceptable methods: (i) a multiple of earnings; (ii) the discount from market value of a similar, freely traded security; (iii) the yield-to-maturity |
for debt issues; or (iv) a consolidation of the methods. The Trust’s Valuation & Operations Committee considers a non-exclusive list of factors to arrive at the appropriate method of determining “Fair Value.” For example, fair value determinations are required for securities whose value is affected by a “significant” event that materially affects the value of a domestic or foreign security which occurs subsequent to the time of the close of the principal market on which such domestic or foreign security trades and before the Valuation Time (i.e., a “subsequent event”). Typically, this will involve events occurring after the close of a foreign market on which a security trades and before the next Valuation Time. | |
The Fund values foreign securities at fair value in the circumstances described below. Generally, trading in foreign securities markets is completed each day at various times prior to the Valuation Time. Due to the time differences between the closings of the relevant foreign securities exchanges and the Valuation Time for the Fund, the Fund will fair value its foreign investments when it is determined that the market quotations for the foreign investments either are not readily available or are unreliable and, therefore, do not represent fair value. When the fair value prices are utilized, these prices will attempt to reflect the impact of the U.S. financial markets’ perceptions and trading activities on the Fund’s foreign investments since the last closing prices of the foreign investments were calculated on their primary foreign securities markets or exchanges. For these purposes, the Board of Trustees has determined that movements in relevant indices or other appropriate market indicators, after the close of the foreign securities exchanges, may demonstrate that market quotations are unreliable, and may trigger fair value pricing for certain securities. Consequently, fair valuation of portfolio securities may occur on a daily basis. |
(b) | Repurchase Agreements |
The Fund may enter into repurchase agreements with an entity which is a member of the Federal Reserve System or which is a “primary dealer” (as designated by the Federal Reserve Bank of New York) in U.S. Government obligations. The repurchase price generally equals the price paid by the Fund plus interest negotiated on the basis of current short-term rates, which may be more or less than the rate on the underlying portfolio securities. The seller under a repurchase agreement is required to maintain the value of the collateral held pursuant to the agreement at a market value equal to or greater than the repurchase price (including accrued interest). Collateral subject to repurchase agreements is held by the Fund’s custodian or another qualified sub-custodian or in the Federal Reserve/Treasury book-entry system. If the counterparty defaults and the fair value of the collateral declines, realization of the collateral by the Fund may be delayed or limited. The Fund may transfer uninvested cash balances into a pooled cash account. These balances are invested in one or more repurchase agreements, with the counterparty of Nomura Securities, which is fully collateralized by U.S. Government Agency Mortgages. |
(c) | Foreign Currency Transactions |
The accounting records of the Fund are maintained in U.S. dollars. Foreign currency amounts are translated into U.S. dollars at the current rate of exchange to determine the value of investments, assets and liabilities. The Fund may enter into foreign currency contracts in connection with purchases or sales of securities denominated in a foreign currency. Purchases and sales of securities, and income and expenses, are translated at the prevailing rate of exchange on the respective date of these transactions. The Fund does not isolate that portion of the results of operations resulting from changes in foreign exchange rates on investments from fluctuations arising from changes in market prices of securities held. These fluctuations are included with the net realized and unrealized gain or loss from investments and foreign currencies. |
(d) | Forward Foreign Currency Contracts |
The Fund may enter into forward foreign currency contracts in connection with planned purchases or sales of securities or to hedge the U.S. dollar value of portfolio securities denominated in a particular currency. The Fund could be exposed to risks if the counterparties to the contracts are unable to meet the terms of their contracts and from unanticipated movements in the value of a foreign currency relative to the U.S. dollar. Forward foreign currency contracts are valued at the current cost of covering these contracts, as provided by an independent pricing service |
approved by the Board of Trustees. The forward foreign currency contracts are adjusted by the daily exchange rate of the underlying currency and any gains or losses are recorded for financial statement purposes as unrealized gains or losses until the contract settlement date. |
(e) | Futures Contracts |
The Fund may invest in financial futures contracts (“futures contracts”) for the purpose of hedging its existing portfolio securities or securities that the Fund intends to purchase against fluctuations in value caused by changes in prevailing market interest rates or prices. Futures contracts may also be entered into for non-hedging purposes. | |
Upon entering into a futures contract, the Fund is required to pledge to the broker an amount of cash and/or other assets equal to a certain percentage of the contract amount (initial margin deposit). Subsequent payments, known as “variation margin,” are made each day, depending on the daily fluctuations in the fair value/market value of the underlying assets. A gain or loss equal to the daily variation margin is recognized on a daily basis. Futures contracts are valued daily at their last quoted sale price. | |
A “sale” of a futures contract means the creation of a contractual obligation to deliver the securities or foreign currency called for by the contract at a fixed price at a specified time in the future. A “purchase” of a futures contract means the creation of a contractual obligation to acquire the securities or foreign currency at a fixed price at a specified time in the future. | |
Should market conditions change unexpectedly, the Fund may not achieve the anticipated benefits of the futures contracts and may realize a loss. The use of futures transactions for hedging purposes involves the risk of imperfect correlation in movements in the price of futures contracts, interest rates, and the value of the underlying hedged assets. |
(f) | Written Options Contracts |
The Fund may write options contracts. A written option obligates the Fund to deliver (written call) or to receive (written put) a specified quantity of an underlying asset at the contract amount upon exercise by the holder of the option. When the Fund writes an option, an amount equal to the premium received by the Fund is recorded as a liability and is subsequently adjusted to the current fair value of the option written. Premiums received from writing options that expire unexercised are treated by the Fund on the expiration date as realized gains from investments. The difference between the premium and the amount paid on effecting a closing purchase transaction, as a realized loss. If a call option is exercised, the premium is added to the proceeds from the sale of the underlying security or currency in determining whether the Fund has realized a gain or loss. If a put option is exercised, the premium reduces the cost basis of the securities purchased by the Fund. Options traded on an exchange are valued at the last quoted sale price, or in the absence of a sale, the bid price provided by an independent pricing service approved by the Board of Trustees. Non-exchange traded options are valued using dealer supplied quotes. The Fund as a writer of an option bears the market risk of an unfavorable change in the price of the security underlying the written option. |
(g) | Security Transactions and Investment Income |
Security transactions are accounted for on the date the security is purchased or sold (“trade date”). Securities gains and losses are calculated on the identified cost basis. Interest income is recognized on the accrual basis and includes, where applicable, the amortization or accretion of premium or discount. Dividend income is recorded on the ex-dividend date. |
(h) | Securities Lending |
To generate additional income, the Fund may lend its portfolio securities, up to 33 1/3% of the Fund, to brokers, dealers and other financial institutions provided that (1) the borrower delivers cash or securities as collateral with respect to each new loan of U.S. securities, equal to at least 102% of the value of the portfolio securities loaned, and with respect to each new loan on non-U.S. securities, collateral of at least 105% of the value of the portfolio securities |
loaned; and (2) at all times thereafter shall require the borrower to mark-to-market the collateral on a daily basis so that the market value of such collateral does not fall below 100% of the value of securities loaned. The Fund receives payments from borrowers equivalent to the dividends and interest that would have been earned on securities loaned while simultaneously seeking to earn income on the investment of cash collateral. There may be risks of delay in recovery of the securities should the borrower of the securities fail financially. Loans will be made, however, only to borrowers deemed by the Fund’s investment adviser to be of good standing and creditworthy under guidelines established by the Board of Trustees and when, in judgment of the adviser, the consideration which can be earned currently from these securities loans justifies the attendant risks. Loans are subject to termination by the Fund or the borrower at any time, and, therefore, are not considered to be illiquid investments. JPMorgan Chase Bank serves as custodian for the securities lending program of the Fund. JPMorgan Chase Bank receives a fee based on the value of the collateral received from borrowers. | |
Information on the investment of cash collateral is shown in the Statement of Investments. | |
As of June 30, 2007, the Fund had securities with the following value on loan: |
Value of | ||||||
Value of Loaned Securities | Collateral | |||||
$32,992,636 | $ | 33,718,470 | ||||
(i) | Distributions to Shareholders |
The Fund’s dividends from net investment income, if any, are declared and paid quarterly. The Fund’s distributions from net realized capital gains, if any, are declared and distributed at least annually. | |
Dividends and distributions to shareholders are determined in accordance with federal income tax regulations, which may differ from GAAP. These “book/tax” differences are considered either permanent or temporary in nature. In accordance with the American Institute of Certified Public Accountants Statement of Position 93-2, permanent differences (i.e., reclassification of market discounts, foreign exchange gain/loss, paydowns, and distributions from real estate investment trusts) are reclassified within the capital accounts based on their nature for federal income tax purposes; temporary differences do not require reclassification. These reclassifications have no effect upon the net asset value of the Fund. To the extent distributions exceed current and accumulated earnings and profits for federal income tax purposes, these distributions are reported as distributions of paid-in-capital. |
(j) | Federal Income Taxes |
It is the policy of the Fund to qualify or to continue to qualify as a “regulated investment company” by complying with the provisions available to certain investment companies, as defined in Subchapter M of the U.S. Internal Revenue Code, and to make distributions of net investment income and net realized capital gains sufficient to relieve the Fund from all, or substantially all, federal income taxes. | |
As of June 30, 2007, the tax cost of securities and the breakdown of unrealized appreciation (depreciation) for the Fund was as follows: |
Net | ||||||||||||||||
Unrealized | ||||||||||||||||
Tax Cost of | Unrealized | Unrealized | Appreciation | |||||||||||||
Securities | Appreciation | Depreciation | (Depreciation) | |||||||||||||
$ | 140,555,756 | $ | 37,983,319 | $ | (3,850,078 | ) | $ | 34,133,241 | ||||||||
(k) | Allocation of Expenses, Income, and Gains and Losses |
Expenses directly attributable to the Fund are charged to the Fund. Expenses not directly attributable to the Fund are allocated proportionately among various or all funds within the Trust. The method used by the Fund for allocating |
income, fund level expenses, and realized and unrealized gains or losses is based on the fair value of shares outstanding relative to net assets. Under this method, each class of shares participates based on the total net asset value of that class’s shares in proportion to the total net assets of the Fund. Expenses specific to a class (such as Rule 12b-1 and administrative services fees) are charged to that class. |
3. Transactions with Affiliates
Under the terms of the Trust’s Investment Advisory Agreement, Nationwide Fund Advisors (formerly, Gartmore Mutual Fund Capital Trust (“GMF”)) (“NFA” or the “Advisor”) manages the investment of the assets and supervises the daily business affairs of the Fund. NFA is a wholly-owned subsidiary of Nationwide Financial Services (“NFS”). In addition, NFA provides investment management evaluation services in initially selecting and monitoring, on an ongoing basis, the performance of the subadvisers for the Fund. The subadvisers listed below manage all or a portion of the Fund’s investments and have the responsibility for making all investment decisions for that portion of the Fund unless otherwise indicated. Below is a list of the subadvisers to the Fund:
Subadvisers | ||||||
— Waddell & Reed Investment Management Company | ||||||
— Oberweis Asset Management, Inc. | ||||||
Under the terms of the Investment Advisory Agreement, the Fund pays NFA an investment advisory fee of 0.95% based on that Fund’s average daily net assets. From such fees, pursuant to the subadvisory agreements, NFA paid the subadvisers $410,852 for the six months ended June 30, 2007.
Under the terms of a Fund Administration and Transfer Agency Agreement, Nationwide Fund Management, LLC (formerly, Gartmore Investor Services, Inc. (“GISI”)) (“NFM”), a wholly-owned subsidiary of NFS Distributors, Inc. (“NFSDI”), provides the Fund with various administrative and accounting services for the Fund (prior to May 1, 2007, this service was provided by Gartmore SA Capital Trust (“GSA”)), and serves as Transfer and Dividend Disbursing Agent for the Fund (prior to May 1, 2007, this service was provided by GISI, an indirect subsidiary of GSA). The fees for the services provided under this Agreement are calculated based on the Trust’s average daily net assets according to the fee schedule below. The fees are then allocated proportionately among all funds within the Trust in relation to the average daily net assets of each fund and are paid to NFA. NFA pays NFM from these fees for NFM’s services.
Combined Fee Schedule* | ||||||
Up to $1 billion | 0.15% | |||||
$1 billion up to $3 billion | 0.10% | |||||
$3 billion up to $8 billion | 0.05% | |||||
$8 billion up to $10 billion | 0.04% | |||||
$10 billion up to $12 billion | 0.02% | |||||
$12 billion or more | 0.01% | |||||
* | The assets of the Nationwide NVIT Investor Destinations Aggressive Fund, the Nationwide NVIT Investor Destinations Moderately Aggressive Fund, the Nationwide NVIT Investor Destinations Moderate Fund, the Nationwide NVIT Investor Destinations Moderately Conservative Fund, and the Nationwide NVIT Investor Destinations Conservative Fund (collectively, the “Investor Destinations Funds”) are excluded from the Trust asset level amount in order to calculate this asset-based fee. The Investor Destinations Funds do not pay any part of this fee. |
NFA and NFM have entered into agreements with Citi Fund Services Ohio, Inc. (“Citi”), pursuant to which Citi provides sub-administration and sub-transfer agency services, respectively, to the Fund. Effective August 1, 2007, The BISYS Group Inc. was acquired by and became a wholly owned subsidiary of Citi.
Under the terms of a Distribution Plan under Rule 12b-1 of the 1940 Act, Nationwide Fund Distributors, LLC. (formerly, “Gartmore Distribution Services, Inc. (“GDSI”)) (“NFD” or “Distributor”), the Fund’s principal underwriter,
Under the terms of an Administrative Services Plan, the Fund may pay fees to servicing organizations, such as broker-dealers, including NFS, and financial institutions, which agree to provide administrative support services to the shareholders of certain classes. These services include, but are not limited, to the following: establishing and maintaining shareholder accounts; processing purchase and redemption transactions; arranging bank wires; performing shareholder sub-accounting; answering inquires regarding the Fund; and other such services. These fees are based on an annual rate of up to 0.25% of the average daily net assets of Class I, Class II and Class III shares of the Fund.
For the six months ended June 30, 2007, NFS received $102,655 in Administrative Services Fees from the Fund.
Under the terms of a letter agreement dated September 12, 2006, by and among NFA, the Audit Committee of the Trust and the Trust, the Trust has agreed to reimburse NFA certain costs related to the Fund’s portion of ongoing administration, monitoring and annual (audit) testing of the Trust’s Rule 38a-1 Compliance Program subject to the pre-approval of the Trust’s Audit Committee. For the six months ended June 30, 2007, the Fund’s portion of such costs amounted to $971.
4. Short-Term Trading Fees
The Fund reserves the right to assess a short-term trading fee on certain transactions out of Class III shares that a separate account makes on behalf of a variable insurance contract owner (the “contract owner”). A separate account that redeems Class III shares on behalf of a contract owner may be subject to a 1.00% short-term trading fee if the separate account held the Class III shares on behalf of the contract owner for 60 days or less, unless an exception applies as disclosed in the Fund’s prospectus. The short-term trading fee is paid directly to the Fund and is intended to offset the cost to the Fund of excess brokerage commissions and other costs associated with fluctuations in Fund asset levels and cash flow caused by short-term trading. For purposes of determining whether the short-term trading fee applies, the Class III shares that were held on behalf of the contract owner the longest will be treated as being redeemed first.
For the six months ended June 30, 2007, the Fund had no contributions to capital due to collection of redemption fees.
5. Investment Transactions
For the six months ended June 30, 2007, (excluding short-term securities) the Fund had purchases of $47,687,182 and sales of $64,783,198.
6. Bank Loans and Earnings Credit
The Trust has a credit agreement with JPMorgan Chase & Co., the Fund’s custodian bank, permitting the Trust to borrow up to $100,000,000. Borrowings under this arrangement bear interest at the Federal Funds rate plus 0.50%. The interest costs, if any, would be included in other fees in the Statement of Operations. No compensating balances were required under the terms of the line of credit. The line of credit is renewed annually, expiring on June 25, 2008, with a commitment fee of 0.07% per year on $100,000,000. There were no borrowings outstanding under this line of credit for the six months ended June 30, 2007.
The Trust’s custodian bank has agreed to reduce the bank’s fees (earnings credit) when the funds of the Trust maintain cash on deposit in non-interest-bearing custody and Demand Deposit Accounts. Earnings credits, if any, are shown as a reduction of total expenses on the Statement of Operations.
7. Portfolio Investment Risks
Risks Associated with Foreign Securities and Currencies. Investments in securities of foreign issuers carry certain risks not ordinarily associated with investments in securities of U.S. issuers. These risks include future political and economic developments, and the possible imposition of exchange controls or other foreign governmental laws and restrictions. In
Certain countries also may impose substantial restrictions on investments in their capital markets by foreign entities, including restrictions on investments in issuers of industries deemed sensitive to relevant national interests. These factors may limit the investment opportunities available and result in a lack of liquidity and high price volatility with respect to securities of issuers from developing countries.
8. Indemnifications
Under the Trust’s organizational documents, certain of the Trust’s Officers and Trustees are indemnified against certain liabilities arising out of the performance of their duties to the Trust. In addition, the Trust has entered into Indemnification Agreements with the Trust’s trustees and certain officers covering similar liabilities. Trust Officers receive no compensation from the Trust for serving as the Trust’s Officers. In addition, in the normal course of business, the Trust enters into contracts with its vendors and others that provide for general indemnifications. The Trust’s maximum exposure under these arrangements is unknown, as this would involve future claims that may be made against the Trust. Based on experience, however, the Trust expects that risk of loss to be remote.
9. Recently Issued Accounting Pronouncements
On July 13, 2006, the Financial Accounting Standards Board (“FASB”) released FASB Interpretation No. 48, Accounting for Uncertainty in Income Taxes (“FIN 48”). FIN 48 provides guidance for how uncertain tax positions should be recognized, measured, presented and disclosed in the financial statements. FIN 48 requires the affirmative evaluation of tax positions taken or expected to be taken in the course of preparing the Fund’s tax returns to determine whether it is more-likely-than-not (i.e., greater than 50 percent) that each tax position will be sustained upon examination by a taxing authority based on the technical merits of the position. A tax position that meets the more-likely-than-not recognition threshold is measured to determine the amount of benefit to recognize in the financial statements. Differences between tax positions taken in a tax return and amounts recognized in the financial statements will generally result in an increase in a liability for taxes payable (or a reduction of a tax refund receivable) and an increase in a deferred tax liability (or a reduction in a deferred tax asset). Adoption of FIN 48 was required no later than the last business day of the first financial statement reporting period for fiscal years beginning after December 15, 2006 and is to be applied to all open tax years as of the effective date. Accordingly, the Fund was required to implement FIN 48 in its net asset value per share (NAV) calculation on June 29, 2007. Management has evaluated the implications of FIN 48 and has concluded that there was no impact to the Fund’s financial statements as of June 29, 2007. The adoption of FIN 48 requires ongoing monitoring and analysis, future conclusions reached by management may be different and result in adjustments to the Fund’s NAV and financial statements.
In September 2006, the FASB issued Statement on Financial Accounting Standards (“SFAS”) No. 157, “Fair Value Measurements.” This standard establishes a single authoritative definition of fair value, sets out a framework for measuring fair value and requires additional disclosures about fair value measurements. SFAS No. 157 applies to fair value measurements already required or permitted by existing standards. SFAS No. 157 is effective for financial statements issued for fiscal years beginning after November 15, 2007 and interim periods within those fiscal years. The changes to current accounting principles generally accepted in the United States of America from the application of this Statement relate to the definition of fair value, the methods used to measure fair value, and the expanded disclosures about fair value measurements. As of June 30, 2007, the Fund does not believe the adoption of SFAS No. 157 will impact the financial statement amounts; however, additional disclosures may be required about the inputs used to develop the measurements and the effect of certain of the measurements on changes in net assets for the period.
Trustees who are not Interested Persons (as defined in the 1940 Act) and Officers of the Trust as of
Number of Portfolios | ||||||||||
Position(s) Held | in the | |||||||||
with the Trust | Principal Occupation(s) | Nationwide Fund | Other | |||||||
Name, Address | and Length of | During Past | Complex Overseen | Directorships | ||||||
and Year of Birth | Time Served1 | Five Years | by Trustee | Held by Trustee2 | ||||||
Charles E. Allen c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1948 | Trustee since July 2000 | Mr. Allen is Chairman, Chief Executive Officer and President of Graimark Realty Advisors, Inc. (real estate development, investment and asset management). | 89 | None | ||||||
Paula H.J. Cholmondeley c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1947 | Trustee since July 2000 | Ms. Cholmondeley was Vice President and General Manager of Sappi Fine Paper North America from April 2000 through December 2003. | 89 | Director of Dentsply International, Inc. (dental products), Ultralife Batteries, Inc., Terex Corporation (construction equipment), Minerals Technology, Inc. (specialty chemicals) and Albany International Corp. (paper industry) | ||||||
C. Brent DeVore3 c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1940 | Trustee since 1990 | Dr. DeVore is President of Otterbein College. | 89 | None | ||||||
Phyllis Kay Dryden c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1947 | Trustee since December 2004 | Ms. Dryden was a partner of Mitchell Madison, a management consulting company from January 2006 until December 2006; she is currently a consultant with the company. Ms. Dryden was formerly Managing Partner of march FIRST, a global management consulting firm. | 89 | None | ||||||
Barbara L. Hennigar c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1935 | Trustee since July 2000 | Retired. | 89 | None | ||||||
Number of Portfolios | ||||||||||
Position(s) Held | in the | |||||||||
with the Trust | Principal Occupation(s) | Nationwide Fund | Other | |||||||
Name, Address | and Length of | During Past | Complex Overseen | Directorships | ||||||
and Year of Birth | Time Served1 | Five Years | by Trustee | Held by Trustee2 | ||||||
Barbara I. Jacobs c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1950 | Trustee since December 2004 | Ms. Jacobs served as Chairman of the Board of Directors of KICAP Network Fund, a European (United Kingdom) hedge fund, from January 2001 through January 2006. From 1998-2003, Ms. Jacobs was also a Managing Director and European Portfolio Manager of CREF Investments (Teachers Insurance and Annuity Association-College Retirement Equities Fund). | 89 | None | ||||||
Douglas F. Kridler c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1955 | Trustee since September 1997 | Mr. Kridler has served as the President and Chief Executive Officer of the Columbus Foundation (a Columbus, OH-based foundation which manages over 1,300 individual endowment funds) since February 2002. Prior to January 31, 2002, Mr. Kridler was the President of the Columbus Association for the Performing Arts and Chairman of the Greater Columbus Convention and Visitors Bureau. | 89 | None | ||||||
Michael D. McCarthy c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1947 | Trustee since December 2004 | Retired. Mr. McCarthy was Chairman of VMAC (commodity swaps) from October 2002 until January 2007; and a partner of Pineville Properties LLC (a commercial real estate development firm) from September 2000 until January 2007. | 89 | None | ||||||
David C. Wetmore c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1948 | Trustee since 1995 and Chairman since February 2005 | Retired. | 89 | None | ||||||
1 | Length of time served includes time served with the Trust’s predecessors. | |
2 | Directorships held in (1) any other investment companies registered under the 1940 Act, (2) any company with a class of securities registered pursuant to Section 12 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or (3) any company subject to the requirements of Section 15(d) of the Exchange Act. | |
3 | Mr. DeVore has served as President of Otterbein College since 1984. Mark Thresher, President and Chief Operating Officer of Nationwide Financial Services, Inc. (“NFS”) has served as a member of the Board of Trustees of Otterbein College since 2000, currently serves as one of 30 of its trustees, and is currently one of two Vice Chairmen of the Board. Each of Nationwide Fund Advisors (“NFA”), the Funds’ investment adviser, and Nationwide Fund Distributors LLC (“NFD”), principal underwriter to the Trust, is a wholly-owned subsidiary of NFS. | |
Additional information regarding the Trustees and Officers may be found in the Trust’s Statement of Additional Information, which is available without charge upon request, by calling 800-848-0920. |
Trustees who are Interested Persons (as defined in the 1940 Act) and/or Officers of the Trust as of
Number of Portfolios | ||||||||||
Position(s) Held | in the | |||||||||
with the Trust | Principal Occupation(s) | Nationwide Fund | Other | |||||||
Name, Address | and Length of | During Past | Complex Overseen | Directorships | ||||||
and Year of Birth | Time Served1 | 5 Years | by Trustee | Held by Trustee 2 | ||||||
Arden L. Shisler c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1941 | Trustee since February 2000 | Retired. Mr. Shisler is the former President and Chief Executive Officer of KeB Transport, Inc., a trucking firm (2000 through 2002). He served as a consultant to KeB from January 2003 through December 2004. Since 1992, Mr. Shisler has also been Chairman of the Board for Nationwide Mutual Insurance Company.3 | 89 | Director of Nationwide Financial Services, Inc., Chairman of Nationwide Mutual Insurance Company3 | ||||||
John H. Grady Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1961 | President & Chief Executive Officer since December 2006 | Mr. Grady is President, and Chief Executive Officer of Nationwide Funds Group which includes Nationwide Fund Advisors,3 Nationwide Fund Management LLC,3 Nationwide Fund Distributors LLC 3 and NWD Investments,2 the asset management operations of Nationwide Mutual Insurance Company, which includes Morley Capital Management, Inc.,2 Nationwide Separate Accounts LLC,2 NorthPointe Capital LLC,2 and Nationwide SA Capital Trust2. From March 2004 until March 2006, Mr. Grady was Chief Executive Officer of Constellation Investment Management Co., L.P. (registered investment adviser), and President and Chief Executive Officer of Constellation Funds Group (registered investment companies). He also was President of Constellation Investment Distribution Co., Inc. (registered broker-dealer) from March 2004 until June 2006. From February 2001 until February 2004, Mr. Grady was Chief Operating and Chief Legal Officer; Managing Director, Mutual Funds Group, Turner Investment Partners, Inc. (registered investment adviser); Executive Vice President of Turner Funds and Turner Institutional Portfolios (registered investment companies); and President, Turner Investment Distributors, Inc. (registered broker-dealer). | N/A | None | ||||||
Gerald J. Holland Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1951 | Treasurer since March 2001 | Mr. Holland is Senior Vice President—Operations for Nationwide Funds Group3. | N/A | N/A | ||||||
Number of Portfolios | ||||||||||
Position(s) Held | in the | |||||||||
with the Trust | Principal Occupation(s) | Nationwide Fund | Other | |||||||
Name, Address | and Length of | During Past | Complex Overseen | Directorships | ||||||
and Year of Birth | Time Served1 | 5 Years | by Trustee | Held by Trustee 2 | ||||||
Michael A. Krulikowski Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1959 | Chief Compliance Officer from June 2004 to August 20074 | Mr. Krulikowski is Vice President and Chief Compliance Officer of Nationwide Funds Group3, Morley Capital Management, Inc.3, Nationwide SA Capital Trust (since 1999)3, and Nationwide Separate Accounts LLC (since August 2005).3 Since June 2004, Mr. Krulikowski has also served as Chief Compliance Officer of the Trust. From November 1999 through May 2007, he served as Vice President and Chief Compliance Officer of NorthPointe Capital LLC. 3 | N/A | N/A | ||||||
Eric E. Miller Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1953 | Secretary since December 2002 | Mr. Miller is Senior Vice President, General Counsel, and Assistant Secretary for Nationwide Funds Group3 and NWD Investments.2 From August 2000 to August 2002, Mr. Miller was a Partner with Stradley Ronon Stevens & Young, LLP. | N/A | N/A | ||||||
1 | Length of time served includes time served with the Trust’s predecessors. | |
2 | Directorships held in (1) any other investment companies registered under the 1940 Act, (2) any company with a class of securities registered pursuant to Section 12 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or (3) any company subject to the requirements of Section 15(d) of the Exchange Act. | |
3 | This position is held with an affiliated person or principal underwriter of the Trust. | |
4 | Effective August 3, 2007, the Board of Trustees approved Carol Baldwin Moody as Chief Compliance Officer of the Trust. Since November 2005, Ms. Moody has been Senior Vice President, Chief Compliance Officer of Nationwide Financial Services, Nationwide Life Insurance Company, Nationwide Life and Annuity Insurance Company, and Nationwide Investment Advisors, LLC. From February 2004-November 2005, she was Chief Compliance Officer of TIAA-CREF and from April 2000-February 2004, she was Managing Director and General Counsel, TCW/ Latin America Partners, LLC and Baeza & Co., LLC. | |
Federal law requires the Trust, each of its investment advisers and sub-advisers to adopt procedures for voting proxies (“Proxy Voting Guidelines”) and to provide a summary of those Proxy Voting Guidelines used to vote the securities held by the Funds. The Funds’ proxy voting policies and procedures are available without charge (i) upon request, by calling 800-848-0920, (ii) on the Funds’ website at www.nationwidefunds.com, or (iii) on the Securities and Exchange Commission’s website at www.sec.gov. |
A. Renewal of Investment Advisory Agreement
(i) | General Information Regarding the Board’s Review of Investment Advisory Agreements |
The Trust’s investment advisory agreements (each an “Advisory Agreement”) with its investment adviser and, as applicable, sub-advisers (together, the “Adviser”) must be approved for an initial term no greater than two years, and renewed at least annually thereafter, (i) by the vote of the Trustees or by a vote of the shareholders of each series or fund of the Trust (individually a “Fund” ), and (ii) by the vote of a majority of the Trustees who are not parties to the Advisory Agreement or “interested persons” of any party thereto (the “Independent Trustees”) cast in person at a meeting called for the purpose of voting on such approval.
The Board meets quarterly and takes into account throughout the year matters bearing on each Fund’s Advisory Agreement. The Board and its standing committees consider at each meeting factors that are relevant to the annual renewal of an Advisory Agreement, including the services and support provided to a Fund and its shareholders.
On December 6, 2006, the Independent Trustees first met in person with their independent legal counsel (“Independent Legal Counsel”) to consider information provided by the Adviser and others to assist the Trustees in considering whether to renew each Fund’s Advisory Agreement for a one year term beginning May 1, 2007. Immediately following such meeting of the Independent Trustees, all Trustees met in person with the Adviser, Trust counsel, Independent Legal Counsel and others to consider such matters, and give preliminary consideration to information bearing on continuation of each Advisory Agreement. The primary purpose of the December 6 and 7, 2006 meeting was to ensure that the Trustees had ample opportunity to consider matters they deemed relevant in considering the continuation of an Advisory Agreement, and to request any additional information they considered reasonably necessary to their deliberations.
In preparation for the December 6 and 7, 2006 meeting the Trustees were provided, at the request of the Trustees, with a wide range of information to assist in their deliberations, including (i) reports from Lipper Inc. describing a Fund’s (a) performance rankings (where “first quintile” denotes the best performance) (over multiple years ended September 30, 2006) compared with performance groups and performance universes created by Lipper (and in some cases, customized peer groups created by the Adviser) of similar or peer group funds, and (b) expense rankings (where “first quintile” denotes the lowest fees and expenses) comparing the Fund’s contractual advisory fee and total expenses with expense groups and expense universes created by Lipper of similar or peer group funds, (ii) information from the Adviser describing the Fund’s performance (over multiple years ended September 30, 2006) compared with its benchmark and Lipper categories, (iii) for Funds under “close review,” copies of letters from the Adviser to the portfolio manager of each such Fund, together with the portfolio manager’s written response describing the reasons for the Fund’s underperformance (iv) information from the Adviser describing performance for the months of October and November, 2006, and annual performance for the year ended November 30, 2006, (v) reports from the Adviser describing the Adviser’s profitability in providing services under an Advisory Agreement, together with an explanation of Adviser’s methodology in calculating its profitability, (vi) information from the Adviser describing any fees paid to the Adviser for managing similar, non-affiliated institutional accounts, including the range of fee levels for such accounts, and (vii) information from the Adviser describing ancillary benefits, in addition to fees for serving as investment adviser, derived by the Adviser as a result of being investment adviser for a Fund, including, where applicable, information on soft-dollar benefits and fees inuring to the Adviser’s affiliates for serving as the Trust’s administrator, fund accountant and transfer agent.
At the December 6 and 7, 2006 meeting, the Trustees reviewed, considered and discussed, among themselves and with the Adviser, Trust counsel and Independent Legal Counsel, among other things, the information described above, and: (i) the nature, extent and quality of services provided by the Adviser under each Advisory Agreement, (ii) the investment performance of each Fund and the Adviser, (iii) the costs of the services provided by the Adviser under the Advisory Agreement and the profits realized by the Adviser thereunder, (iv) the extent to which economies of scale may be present and, if so, whether they are being shared with a Fund’s shareholders, (v) comparisons of the Adviser’s fees under the Advisory Agreement with investment advisory fees paid by peer group funds to their investment advisers and paid by non-affiliated institutional clients to the Adviser for managing similar accounts, and (vi) any ancillary benefits inuring to the Adviser and its affiliates as a result of being investment adviser for the Trust. The Trustees also considered, where
As part of the December 6 and 7, 2006 Board meeting, the Independent Trustees developed a list of follow-up matters and questions and asked that Adviser respond to such matters and questions at the contract approval meeting of the Board of Trustees to be held on January 11, 2007.
At the January 11, 2007 meeting of the Board of Trustees of the Trust, the Board received and considered information provided by the Adviser in follow-up from the December 6 and 7, 2006 Board meeting and, after consulting among themselves, and with the Adviser, Trust counsel and Independent Legal Counsel, concluded unanimously to renew the Advisory Agreement for the reasons set forth in the following section. In determining whether to renew the Advisory Agreement for the Fund, the Board ultimately reached a determination, with the assistance of Trust counsel and Independent Legal Counsel, that the renewal of the Advisory Agreement and the compensation to be received by the Adviser under the Advisory Agreement is consistent with the Board’s fiduciary duty under applicable law.
(ii) | Board Conclusions Regarding the Fund’s Advisory Agreement |
The Board considered that the Fund had underperformed its benchmark, the MSCI Emerging Markets Index, for the one-, three-, and five-year periods. The Board also considered that the Fund’s Class II shares had ranked in the fifth quintile of the Fund’s Lipper-constructed Performance Group over the one-, two-, three-, four-, and five-year periods. Although the Fund’s performance compared with peer group funds over the periods considered ranked the Fund in the fifth quintile, the Board found that: (i) the portfolio manager for the Fund was changed during the year; (ii) recent performance had shown improvement; and (iii) the flows in and out of the Fund had been more extreme, which made management more difficult, and had affected performance. Based on its review, and giving particular weight to the nature and quality of the resources dedicated by the adviser and subadviser to improve relative performance, the Board concluded that the nature, extent, and quality of the services provided to the Fund will benefit the Fund’s shareholders.
The Board also considered that the Fund’s contractual advisory fee and breakpoints placed the Fund in the first quintile of its Lipper-constructed Expense Group and the Fund’s total expenses placed it in the second quintile. The Board considered that the Fund had implemented a performance fee structure, which is intended to either reward or penalize the adviser for outperforming or underperforming, respectively, the Fund’s benchmark. The Board concluded that the Fund’s management fee and total expenses were fair and reasonable in light of the services that the Fund receives and the other factors considered.
The Board considered that the Fund’s adviser reported a pre-tax profit margin for investment management services during each of the twelve month-periods ended September 30, 2006 and 2005. The Board considered the costs of the services provided by and the profits realized by the adviser in connection with the operation of the Fund and determined that the amount of profit is a fair entrepreneurial profit for the management of the Fund.
Based upon its evaluation of all of the conclusions noted above, and after considering all material factors with respect to the Fund, the Board ultimately concluded that the advisory fee structure is fair and reasonable, and that the Advisory Agreement (and, if applicable, Sub-Advisory Agreement) with respect to the Fund, should be renewed.
B. Approval of New Advisory Agreement
At its January 11, 2007 meeting, the Board also unanimously approved a new investment advisory agreement (the “New Agreement”) for the Fund with Nationwide Fund Advisors, (“NFA”) the then-current adviser to each of the series of the Trust to become effective upon the closing of the acquisition of NFA by Nationwide Financial Services, Inc. (“NFS”) from Nationwide Corporation (“NWC”) which closed on April 30, 2007 (the “Transaction”). In approving the New Agreement, the Board considered NFA’s capacity to continue to provide the services needed to operate a sophisticated investment management business and to support the management of each of the series. The Board also took into account
C. Submission of Matters to a Vote of Security Holders:
On April 25, 2007, a Special Meeting of Shareholders was held* (the “April 25 Meeting”) at which shareholders of the Funds** set forth below were asked:
Proposal 1:
To approve a new investment advisory agreement, on behalf of their Fund, between Nationwide Fund Advisors (formerly “Gartmore Mutual Fund Capital Trust”) (the “Adviser”) and Nationwide Variable Insurance Trust (formerly “Gartmore Variable Insurance Trust”) (the “Trust”).
Number of Shares | ||||||
Fund | Cast/Not Cast | Percentages | ||||
Federated NVIT High Income Bond Fund (Formerly Federated GVIT High Income Bond Fund) | FOR AGAINST ABSTAIN TOTAL | 30,051,703.188 shares 618,245.021 shares 1,813,550.431 shares 32,483,498.640 shares | 92.514% 1.903% 5.583% | |||
NVIT International Index Fund (Formerly GVIT International Index Fund) | FOR AGAINST ABSTAIN TOTAL | 4,322,203.982 shares 2,758.318 shares 135,636.840 shares 4,460,599.140 shares | 96.897% 0.062% 3.041% | |||
NVIT International Value Fund (Formerly GVIT International Value Fund) | FOR AGAINST ABSTAIN TOTAL | 20,032,843.199 shares 333,588.902 shares 1,093,293.879 shares 21,459,725.980 shares | 93.351% 1.554% 5.095% | |||
NVIT Mid Cap Index Fund (Formerly GVIT Mid Cap Index Fund) | FOR AGAINST ABSTAIN TOTAL | 35,380,179.120 shares 631,117.844 shares 1,565,714.306 shares 37,577,011.270 shares | 94.154% 1.679% 4.167% |
Number of Shares | ||||||
Fund | Cast/Not Cast | Percentages | ||||
NVIT S&P 500 Index Fund (Formerly GVIT S&P 500 Index Fund) | FOR AGAINST ABSTAIN TOTAL | 56,119,814.230 shares 666,195.542 shares 1,944,898.888 shares 58,730,908.660 shares | 95.554% 1.134% 3.312% | |||
Nationwide Multi-Manager NVIT Small Cap Growth Fund (Formerly GVIT Small Cap Growth Fund) | FOR AGAINST ABSTAIN TOTAL | 7,632,918.513 shares 149,458.111 shares 451,583.036 shares 8,233,959.660 shares | 92.700% 1.816% 5.484% | |||
Nationwide Multi-Manager NVIT Small Cap Value Fund (Formerly GVIT Small Cap Value Fund) | FOR AGAINST ABSTAIN TOTAL | 48,649,396.525 shares 979,183.753 shares 2,786,133.102 shares 52,414,713.380 shares | 92.816% 1.868% 5.316% | |||
Nationwide Multi-Manager NVIT Small Company Fund (Formerly GVIT Small Company Fund) | FOR AGAINST ABSTAIN TOTAL | 29,903,181.700 shares 838,774.923 shares 2,006,741.307 shares 32,748,697.930 shares | 91.311% 2.561% 6.128% | |||
Gartmore NVIT Developing Markets Fund (Formerly Gartmore GVIT Developing Markets Fund) | FOR AGAINST ABSTAIN TOTAL | 21,0177,889.443 shares 424,272.958 shares 1,543,850.729 shares 23,046,013.130 shares | 91.460% 1.841% 6.699% | |||
Gartmore NVIT Emerging Markets Fund (Formerly Gartmore GVIT Emerging Markets Fund) | FOR AGAINST ABSTAIN TOTAL | 17,050,534.593 shares 526,574.722 shares 881,608.905 shares 18,458,718.220 shares | 92.371% 2.853% 4.776% | |||
Nationwide NVIT Global Financial Services Fund (Formerly Gartmore GVIT Global Financial Services Fund) | FOR AGAINST ABSTAIN TOTAL | 1,554,847.333 shares 19,539.033 shares 52,206.494 shares 1,626,592.860 shares | 95.589% 1.201% 3.210% | |||
Nationwide NVIT Global Health Sciences Fund (Formerly Gartmore GVIT Global Health Sciences Fund) | FOR AGAINST ABSTAIN TOTAL | 4,722,963.678 shares 157,979.030 shares 207,642.222 shares 5,088,584.930 shares | 92.815% 3.104% 4.081% | |||
Nationwide NVIT Global Technology and Communications Fund (Formerly Gartmore GVIT Global Technology and Communications Fund) | FOR AGAINST ABSTAIN TOTAL | 8,585,472.039 shares 102,267.977 shares 489,577.634 shares 9,177,317.650 shares | 93.551% 1.114% 5.335% | |||
Gartmore NVIT Global Utilities Fund (Formerly Gartmore GVIT Global Utilities Fund) | FOR AGAINST ABSTAIN TOTAL | 4,123,270.549 shares 122,001.533 shares 240,276.088 shares 4,485,548.170 shares | 91.923% 2.720% 5.357% | |||
Nationwide NVIT Government Bond Fund (Formerly Gartmore GVIT Government Bond Fund) | FOR AGAINST ABSTAIN TOTAL | 88,471,567.462 shares 1,825,645.181 shares 5,841,990.727 shares 96,139,203.370 shares | 92.024% 1.899% 6.077% |
Number of Shares | ||||||
Fund | Cast/Not Cast | Percentages | ||||
Nationwide NVIT Growth Fund (Formerly Gartmore GVIT Growth Fund) | FOR AGAINST ABSTAIN TOTAL | 14,931,435.904 shares 409,826.402 shares 1,259,945.064 shares 16,601,207.370 shares | 89.942% 2.469% 7.589% | |||
Gartmore NVIT International Growth Fund (Formerly Gartmore GVIT International Growth Fund) | FOR AGAINST ABSTAIN TOTAL | 6,251,419.070 shares 139,618.548 shares 290,025.592 shares 6,681,063.210 shares | 93.569% 2.090% 4.341% | |||
Nationwide NVIT Investor Destinations Aggressive Fund (Formerly Gartmore GVIT Investor Destinations Aggressive Fund) | FOR AGAINST ABSTAIN TOTAL | 49,489,224.549 shares 1,385,396.474 shares 3,696,272.337 shares 54,570,893.360 shares | 90.688% 2.539% 6.773% | |||
Nationwide NVIT Investor Destinations Conservative Fund (Formerly Gartmore GVIT Investor Destinations Conservative Fund) | FOR AGAINST ABSTAIN TOTAL | 23,091,965.887 shares 314,935,884 shares 2,292,355.179 shares 25,699,256.950 shares | 89.855% 1.225% 8.920% | |||
Nationwide NVIT Investor Destinations Moderate Fund (Formerly Gartmore GVIT Investor Destinations Moderate Fund) | FOR AGAINST ABSTAIN TOTAL | �� | 188,902,093.059 shares 3,018,924.590 shares 16,359,690.401 shares 208,280,708.050 shares | 90.696% 1.449% 7.855% | ||
Nationwide NVIT Investor Destinations Moderately Aggressive Fund (Formerly Gartmore GVIT Investor Destinations Moderately Aggressive Fund) | FOR AGAINST ABSTAIN TOTAL | 134,792,622.920 shares 3,489,207.264 shares 9,304,197.656 shares 147,586,027.840 shares | 91.332% 2.364% 6.304% | |||
Nationwide NVIT Investor Destinations Moderately Conservative Fund (Formerly Gartmore GVIT Investor Destinations Moderately Conservative Fund) | FOR AGAINST ABSTAIN TOTAL | 49,627,123.216 shares 856,088.634 shares 3,507,215.650 shares 53,990,427.500 shares | 91.918% 1.586% 6.496% | |||
Nationwide NVIT Mid Cap Growth Fund (Formerly Gartmore GVIT Mid Cap Growth Fund) | FOR AGAINST ABSTAIN TOTAL | 10,879,584.971 shares 352,594.958 shares 717,792.971 shares 11,949,972.900 shares | 91.043% 2.950% 6.007% | |||
Nationwide NVIT Money Market Fund II (Formerly Gartmore GVIT Money Market Fund II) | FOR AGAINST ABSTAIN TOTAL | 221,774,863.241 shares 12,322,482.494 shares 16,471,740.875 shares 250,569,086.610 shares | 88.508% 4.918% 6.574% | |||
Nationwide NVIT Money Market Fund (Formerly Gartmore GVIT Money Market Fund) | FOR AGAINST ABSTAIN TOTAL | 1,578,331,008.328 shares 32,372,133.671 shares 112,652,123.301 shares 1,723,355,265.300 shares | 91.585% 1.878% 6.537% | |||
NVIT Nationwide Fund (Formerly Gartmore GVIT Nationwide Fund) | FOR AGAINST ABSTAIN TOTAL | 125,423,274.735 shares 2,767,979.467 shares 8,762,255.828 shares 136,953,510.030 shares | 91.581% 2.021% 6.398% |
Number of Shares | ||||||
Fund | Cast/Not Cast | Percentages | ||||
NVIT Nationwide Leaders Fund (Formerly Gartmore GVIT Nationwide Leaders Fund) | FOR AGAINST ABSTAIN TOTAL | 2,298,504.956 shares 29,630.469 shares 71,637.755 shares 2,399,773.180 shares | 95.780% 1.235% 2.985% | |||
Nationwide NVIT U.S. Growth Leaders Fund (Formerly Gartmore GVIT U.S. Growth Leaders Fund) | FOR AGAINST ABSTAIN TOTAL | 4,972,094.773 shares 122,623.161 shares 174,625.606 shares 5,269,343.540 shares | 94.359% 2.327% 3.314% | |||
Gartmore NVIT Worldwide Leaders Fund (Formerly Gartmore GVIT Worldwide Leaders Fund) | FOR AGAINST ABSTAIN TOTAL | 2,666,862.487 shares 47,702.491 shares 118,719.882 shares 2,833,284.860 shares | 94.126% 1.684% 4.190% | |||
JP Morgan NVIT Balanced Fund (Formerly JP Morgan GVIT Balanced Fund) | FOR AGAINST ABSTAIN TOTAL | 15,966,867.546 shares 259,004.324 shares 1,339,385.200 shares 17,565,257.070 shares | 90.900% 1.475% 7.625% | |||
Van Kampen NVIT Comstock Value Fund (Formerly Van Kampen GVIT Comstock Value Fund) | FOR AGAINST ABSTAIN TOTAL | 27,737,008.009 shares 502,564.164 shares 1,824,670.107 shares 30,064,242.280 shares | 92.259% 1.672% 6.069% | |||
Van Kampen NVIT Multi Sector Bond Fund (Formerly Van Kampen GVIT Multi Sector Bond Fund) | FOR AGAINST ABSTAIN TOTAL | 21,253,297.665 shares 484,100.920 shares 1,803,963.645 shares 23,541,362.230 shares | 90.281% 2.056% 7.663% | |||
At the April 25 Meeting, shareholders of the Nationwide NVIT Mid Cap Growth Fund were also asked to approve a new investment subadvisory agreement among the Adviser, the Trust and NorthPointe Capital LLC. The voting results with respect to that proposal are set forth below:
Proposal 2:
Number of Shares | ||||||
Fund | Cast/Not Cast | Percentages | ||||
Nationwide NVIT Mid Cap Growth Fund (Formerly Gartmore GVIT Mid Cap Growth Fund) | FOR AGAINST ABSTAIN TOTAL | 10,862,827.499 shares 414,574.660 shares 672,570.741 shares 11,949,972.900 shares | 90.903% 3.469% 5.628% | |||
* | This meeting was previously adjourned on April 23, 2007. | |
** | Fund names were changed effective May 1, 2007 to reflect “Nationwide”/“NVIT” branding to coincide with the sale of Nationwide Fund Advisors, Inc. by Nationwide Corporation to its majority-owned subsidiary, Nationwide Financial Services, Inc. |
June 30, 2007 (Unaudited)
Contents | ||
6 | Statement of Investments | |
16 | Statement of Assets and Liabilities | |
17 | Statement of Operations | |
18 | Statements of Changes in Net Assets | |
20 | Financial Highlights | |
22 | Notes to Financial Statements |
Statement Regarding Availability of Proxy Voting Record.
SAR-SCV (8/07) | ![]() |
Dear Fellow Shareholder:
Since I last wrote to you, our mutual funds have enjoyed another period of solid performance, and the corporate realignment that was in progress is now finished.
On May 1, 2007, Nationwide Financial Services, Inc. (NFS), completed its acquisition of the Philadelphia-based retail mutual fund operations of NWD Investment Management, Inc. (formerly, “Gartmore Global Investments, Inc.”), from Nationwide Corporation, a subsidiary of Nationwide Mutual Insurance Company. Effective that date, the acquired entities were renamed Nationwide Funds Group (NFG), and the Gartmore Funds were renamed the Nationwide Funds to better align with the Nationwide® brand. Although the corporate ownership and fund names have changed, I can assure you that NFG intends to maintain as much continuity as possible with the Funds and key personnel.
Thank you, shareholders, for approving the new investment advisory agreement that was required due to the change in corporate ownership. The new agreement is identical in all material respects to the original agreement that it replaces, with the exception of the section pertaining to the vote by the shareholders of the NVIT Mid Cap Growth Fund to approve NorthPointe Capital®, LLC (NorthPointe) as sub-adviser to that particular Fund.
Market Overview: January 1-June 30, 2007
Share prices in general were buoyed in part by better-than-expected first-quarter 2007 earnings and a flurry of mergers and acquisitions, many of these spurred by readily available funding from private equity firms. In June, investors grew more cautious amid surging crude oil prices, a sudden spike in long-term interest rates, and the meltdown of two hedge funds that had exposure to the subprime mortgage market. Looking abroad, a weak U.S. dollar aided foreign stocks, as reflected in the 11.09% advance of the Morgan Stanley Capital International Europe, Australasia and Far East (MSCI EAFE®) Index. Emerging market performance was particularly robust.
The bond market struggled during the first half of 2007. While short-term interest rates remained stable, reflecting the Federal Reserve Board’s decision in June to leave the target federal funds rate at 5.25%, longer-term rates climbed during the first half of 2007, depressing bond prices and forcing the Lehman Brothers® U.S. Aggregate Index to settle for a modest 0.97% return.
We at NFG thank you for your understanding and cooperation throughout our recent transition period. We emerge from this period energized for the future, and we look forward to serving your investment needs for a long time to come.
Nationwide Funds Group
PAST PERFORMANCE IS NO GUARANTEE OF FUTURE RESULTS.
Nationwide Funds are advised by Nationwide Fund Advisors (NFA). NFA is a wholly-owned subsidiary of Nationwide Financial Services. Nationwide Financial Services is a wholly-owned subsidiary of Nationwide Corporation. All of the common stock of Nationwide Corporation is held by Nationwide Mutual (95.2%) and Nationwide Mutual Fire Insurance Company (4.8%), each of which is a mutual company owned by its policyholders.
Nationwide Funds Group (NFG) is the mutual fund arm of Nationwide Financial Services (NYSE: NFS). Based in Conshohocken, Pa., a suburb of Philadelphia, NFG is comprised of Nationwide Fund Advisors, Nationwide Fund Distributors, LLC, and Nationwide Fund Management, LLC. Together, these provide advisory, distribution, and administration services respectively to the Nationwide Funds, and manage more than $43.5 billion in assets as of June 30, 2007, of which more than $12 billion are in “fund of funds” designed to provide asset allocation across several types of investments and asset classes.
Lehman Brothers (LB) U.S. Aggregate Index: An unmanaged, market value-weighted index of investment-grade, fixed-rate debt issues (including government, corporate, asset-backed, and mortgage-backed securities with maturities of one year or more) that is generally representative of the bond market as a whole.
Morgan Stanley Capital International Europe, Australasia and Far East (MSCI EAFE®) Index: An unmanaged, free float-adjusted, market capitalization-weighted index that is designed to measure the performance of stocks in developed markets outside the United States and Canada.
Standard & Poor’s 500® (S&P 500) Index: An unmanaged, market capitalization-weighted index of 500 widely held stocks of large-cap U.S. companies that gives a broad look at how the stock prices of those companies have performed.
Views expressed within are those of Nationwide Funds Group as of the date noted, are subject to change at any time, and may not come to pass.
This report is for informational purposes only, and is not intended as an offer or recommendation with respect to the purchase or sale of any security, option, future, or other derivatives in such securities.
Investing in mutual funds involves risk, including possible loss of principal.
Investors should carefully consider a fund’s investment objectives, risks, fees, charges, and expenses before investing any money. To obtain this and other fund information, please call 800-848-0920 to request a prospectus, or download a prospectus at www.nationwidefunds.com. Please read the prospectus carefully before investing any money.
Nationwide Funds distributed by Nationwide Fund Distributors LLC (formerly Gartmore Distribution Services, Inc.), Member NASD. 1200 River Road, Suite 1000, Conshohocken, Pa. 19428.
As a shareholder of the Fund, you incur two types of costs: (1) transaction costs, including sales charges (loads) paid on purchase payments and redemption fees; and (2) ongoing costs, including investment advisory fees, administration fees, distribution fees and other Fund expenses. The examples below are 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. Per SEC requirements, the examples assume that you had a $1,000 investment in the Class at the beginning of the reporting period, January 1, 2007, and continued to hold your shares at the end of the reporting period, June 30, 2007.
Actual Expenses
Hypothetical Example for Comparison Purposes
Please note that the expenses shown in the table are meant to highlight your ongoing costs only and do not reflect any transaction costs, such as sales charges (loads) or redemption fees. Therefore, the second line for each Class in 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 transaction costs were included, your costs would have been higher. The examples also assume all dividends and distributions have been reinvested.
Schedule of Shareholder Expenses
Nationwide Multi-Manager NVIT Small Cap Value | ||||||||||||||||||||||
Ending | ||||||||||||||||||||||
Beginning | Account | |||||||||||||||||||||
Account Value, | Value, | Expenses Paid | Annualized | |||||||||||||||||||
January 1, 2007 | June 30, 2007 | During Period* | Expense Ratio* | |||||||||||||||||||
Class I | Actual | $ | 1,000.00 | $ | 1,060.70 | $ | 5.67 | 1.11% | ||||||||||||||
Hypothetical | 1 | $ | 1,000.00 | $ | 1,019.30 | $ | 5.57 | 1.11% | ||||||||||||||
Class II | Actual | $ | 1,000.00 | $ | 1,058.90 | $ | 6.94 | 1.36% | ||||||||||||||
Hypothetical | 1 | $ | 1,000.00 | $ | 1,018.06 | $ | 6.83 | 1.36% | ||||||||||||||
Class III | Actual | $ | 1,000.00 | $ | 1,059.90 | $ | 5.62 | 1.10% | ||||||||||||||
Hypothetical | 1 | $ | 1,000.00 | $ | 1,019.35 | $ | 5.52 | 1.10% | ||||||||||||||
Class IV | Actual | $ | 1,000.00 | $ | 1,060.00 | $ | 5.57 | 1.09% | ||||||||||||||
Hypothetical | 1 | $ | 1,000.00 | $ | 1,019.39 | $ | 5.47 | 1.09% | ||||||||||||||
* | Expenses are equal to the Fund’s annualized expense ratio multiplied by the average account value over the period multiplied by 181/365 (to reflect the one-half year period). The expense ratio presented represents a six-month, annualized ratio in accordance with SEC guidelines. The expenses reported above do not include the effect of additional expenses imposed by variable annuity contracts. | |
1 | Represents the hypothetical 5% return before expenses. |
The SEC adopted a requirement that Funds present their portfolio holdings in a table, chart or graph format in their annual and semiannual reports to shareholders, whether or not a statement of investments is utilized. The following tables, which present portfolio holdings as a percentage of net assets, are provided in compliance with this requirement.
Asset Allocation | ||||
Common Stock | 97.0% | |||
Cash Equivalents | 2.2% | |||
U.S. Treasury Notes | 0.1% | |||
Other assets in excess of liabilities | 0.7% | |||
100.0% |
Top Holdings | ||||
AIM Liquid Assets Portfolio, 5.09%, 04/01/42 | 2.2% | |||
Westar Energy, Inc. | 0.8% | |||
Ashford Hospitality Trust | 0.7% | |||
Silgan Holdings, Inc. | 0.7% | |||
Powerwave Technologies, Inc. | 0.7% | |||
Lexington Corporate Properties Trust | 0.7% | |||
Sybase, Inc. | 0.7% | |||
Infocrossing, Inc. | 0.7% | |||
Deluxe Corp. | 0.6% | |||
Moog, Inc. | 0.6% | |||
Other | 91.6% | |||
100% |
Top Industries | ||||
Real Estate Investment Trusts (REITs) | 9.6% | |||
Commercial Banks | 8.8% | |||
Insurance | 4.5% | |||
Commercial Services & Supplies | 3.6% | |||
Aerospace & Defense | 3.5% | |||
Software | 3.4% | |||
Chemicals | 3.3% | |||
Machinery | 3.0% | |||
Specialty Retail | 2.9% | |||
Communications Equipment | 2.6% | |||
Other | 54.8% | |||
100.0% |
Nationwide Multi-Manager NVIT Small Cap Value Fund
COMMON STOCK (97.0%) | ||||||||
Shares or | ||||||||
Principal Amount | Value | |||||||
Aerospace & Defense (3.5%) | ||||||||
AAR Corp.* | 13,300 | $ | 439,033 | |||||
Alliant Techsystems, Inc.* | 28,900 | 2,865,435 | ||||||
Ceradyne, Inc.* | 27,600 | 2,041,296 | ||||||
Curtiss-Wright Corp. | 29,500 | 1,374,995 | ||||||
DRS Technologies, Inc. | 62,100 | 3,556,467 | ||||||
EDO Corp. | 100,870 | 3,315,597 | ||||||
Esterline Technologies Corp.* | 18,500 | 893,735 | ||||||
Hexcel Corp.* | 83,370 | 1,756,606 | ||||||
Moog, Inc., Class A* | 86,135 | 3,799,415 | ||||||
Orbital Sciences Corp.* | 20,200 | 424,402 | ||||||
Spirit Aerosystems Holdings, Inc., Class A* | 54,300 | 1,957,515 | ||||||
Triumph Group, Inc. | 9,400 | 615,418 | ||||||
23,039,914 | ||||||||
Air Freight & Logistics (0.2%) | ||||||||
Atlas Air Worldwide Holdings, Inc.* | 18,600 | 1,096,284 | ||||||
1,096,284 | ||||||||
Airlines (0.5%) | ||||||||
ExpressJet Holdings, Inc.* | 65,300 | 390,494 | ||||||
Republic Airways Holdings, Inc.* | 81,200 | 1,652,420 | ||||||
SkyWest, Inc. | 53,100 | 1,265,373 | ||||||
3,308,287 | ||||||||
Auto Components (1.0%) | ||||||||
Aftermarket Technology Corp.* | 47,100 | 1,397,928 | ||||||
American Axle & Manufacturing Holdings, Inc. | 13,400 | 396,908 | ||||||
ArvinMeritor, Inc. | 64,800 | 1,438,560 | ||||||
Lear Corp.* | 8,100 | 288,441 | ||||||
Modine Manufacturing Co. | 42,800 | 967,280 | ||||||
Standard Motor Products, Inc. | 24,300 | 365,229 | ||||||
Tenneco Automotive, Inc.* | 41,900 | 1,468,176 | ||||||
Visteon Corp.* | 31,200 | 252,720 | ||||||
6,575,242 | ||||||||
Biotechnology (0.8%) | ||||||||
Bio-Rad Laboratories, Inc., Class A* | 12,900 | 974,853 | ||||||
Bio-Reference Laboratories, Inc.* | 52,540 | 1,436,969 | ||||||
Cambrex Corp. | 117,720 | 1,562,144 | ||||||
Celera Genomics Group* | 11,300 | 140,120 | ||||||
Exelixis, Inc.* | 19,600 | 237,160 | ||||||
Martek Biosciences Corp.* | 1,000 | 25,970 | ||||||
Medivation, Inc.* | 5,200 | 106,236 | ||||||
Nektar Therapeutics* | 6,700 | 63,583 | ||||||
United Therapeutics Corp.* | 5,200 | 331,552 | ||||||
4,878,587 | ||||||||
Building Products (0.6%) | ||||||||
Ameron International Corp. | 7,400 | 667,406 | ||||||
Apogee Enterprises, Inc. | 17,400 | 484,068 | ||||||
Goodman Global, Inc.* | 51,820 | 1,151,440 | ||||||
NCI Building Systems, Inc.* | 16,700 | 823,811 | ||||||
Universal Forest Products, Inc. | 20,200 | 853,652 | ||||||
3,980,377 | ||||||||
Capital Markets (0.9%) | ||||||||
Knight Capital Group, Inc., Class A* | 67,700 | 1,123,820 | ||||||
MCG Capital Corp. | 35,800 | 573,516 | ||||||
Piper Jaffray Cos.* | 5,600 | 312,088 | ||||||
Sanders Morris Harris Group, Inc. | 119,250 | 1,388,070 | ||||||
SWS Group, Inc. | 20,400 | 441,048 | ||||||
Technology Investment Capital Corp. | 64,490 | 1,018,297 | ||||||
TradeStation Group, Inc.* | 101,370 | 1,180,961 | ||||||
6,037,800 | ||||||||
Chemicals (3.3%) | ||||||||
Agrium, Inc. | 45,480 | 1,989,750 | ||||||
BE Aerospace, Inc.* | 10,400 | 429,520 | ||||||
C.F. Industries Holdings, Inc. | 44,100 | 2,641,149 | ||||||
Cytec Industries, Inc. | 9,000 | 573,930 | ||||||
Fuller (H. B.) Co. | 69,700 | 2,083,333 | ||||||
Hercules, Inc.* | 137,630 | 2,704,429 | ||||||
Innospec, Inc. | 10,000 | 592,100 | ||||||
Methanex Corp. | 68,100 | 1,712,034 | ||||||
Minerals Technologies, Inc. | 7,200 | 482,040 | ||||||
Nalco Holding Co. | 73,590 | 2,020,046 | ||||||
Newmarket Corp. | 6,700 | 324,079 | ||||||
O.M. Group, Inc.* | 11,000 | 582,120 | ||||||
Olin Corp. | 9,000 | 189,000 | ||||||
Rockwood Holdings, Inc.* | 24,000 | 877,200 | ||||||
Sensient Technologies Corp. | 73,310 | 1,861,341 | ||||||
Spartech Corp. | 30,300 | 804,465 | ||||||
Terra Industries, Inc.* | 44,600 | 1,133,732 | ||||||
W.R. Grace & Co.* | 30,900 | 756,741 | ||||||
21,757,009 | ||||||||
Commercial Banks (8.8%) | ||||||||
1st Source Corp. | 11,700 | 291,564 | ||||||
Amcore Financial, Inc. | 73,550 | 2,132,214 | ||||||
Americanwest Bancorp | 4,300 | 78,389 | ||||||
Ameris Bancorp | 13,480 | 302,896 | ||||||
BancFirst Corp. | 9,600 | 411,072 | ||||||
Banco Latinoamericano de Exportaciones, S.A. - PA | 15,100 | 283,880 | ||||||
Bank of Granite | 12,800 | 213,632 |
COMMON STOCK (continued) | ||||||||
Shares or | ||||||||
Principal Amount | Value | |||||||
Commercial Banks (continued) | ||||||||
Banner Corp. | 4,900 | $ | 166,894 | |||||
BOK Financial Corp. | 27,900 | 1,490,418 | ||||||
Camden National Corp. | 5,500 | 215,270 | ||||||
Capital Corp. of the West | 4,360 | 104,466 | ||||||
Capitol Bancorp Ltd. | 9,400 | 256,902 | ||||||
Cathay General Bancorp, Inc. | 10,600 | 355,524 | ||||||
Central Pacific Financial Corp. | 53,200 | 1,756,132 | ||||||
Chemical Financial Corp. | 14,955 | 386,886 | ||||||
Citizens Banking Corp. | 14,547 | 266,210 | ||||||
City Holding Co. | 29,000 | 1,111,570 | ||||||
Colonial Bancgroup, Inc. | 62,400 | 1,558,128 | ||||||
Columbia Banking System, Inc. | 12,330 | 360,652 | ||||||
Community Bancorp* | 3,500 | 97,930 | ||||||
Community Bank System, Inc. | 15,400 | 308,308 | ||||||
Community Trust Bancorp, Inc. | 28,570 | 922,811 | ||||||
Cullen/ Frost Bankers, Inc. | 20,300 | 1,085,441 | ||||||
Farmers Capital Bank Corp. | 2,900 | 83,897 | ||||||
First BanCorp. Puerto Rico | 52,600 | 578,074 | ||||||
First Citizens BancShares, Class A | 5,440 | 1,057,536 | ||||||
First Commonwealth Financial Corp. | 34,400 | 375,648 | ||||||
First Community Bankshares, Inc. | 10,200 | 318,138 | ||||||
First Merchants Corp. | 11,500 | 276,345 | ||||||
First Regional Bancorp* | 7,200 | 183,168 | ||||||
First Republic Bancorp, Inc. | 41,950 | 2,251,037 | ||||||
First State Bancorp | 79,100 | 1,684,039 | ||||||
FNB Corp. | 7,200 | 258,480 | ||||||
Glacier Bancorp, Inc. | 19,200 | 390,720 | ||||||
Great Southern Bancorp, Inc. | 25,300 | 684,365 | ||||||
Greater Bay Bancorp | 30,400 | 846,336 | ||||||
Greene County Bancshares, Inc. | 4,100 | 128,166 | ||||||
Hanmi Financial Corp. | 171,500 | 2,925,790 | ||||||
Heartland Financial U.S.A., Inc. | 5,900 | 143,370 | ||||||
Heritage Commerce Corp. | 2,900 | 68,672 | ||||||
Horizon Financial Corp. | 9,625 | 209,729 | ||||||
Iberiabank Corp. | 30,900 | 1,528,005 | ||||||
Independent Bank Corp. | 30,900 | 912,786 | ||||||
Independent Bank Corp., Michigan | 32,610 | 561,218 | ||||||
Integra Bank Corp. | 15,800 | 339,226 | ||||||
Intervest Bancshares Corp. | 3,200 | 90,112 | ||||||
Irwin Financial Corp. | 35,100 | 525,447 | ||||||
Lakeland Financial Corp. | 6,800 | 144,636 | ||||||
Mainsource Financial Group, Inc. | 19,810 | 332,610 | ||||||
Mercantile Bank Corp. | 4,260 | 115,446 | ||||||
Nara Bankcorp, Inc. | 23,000 | 366,390 | ||||||
National Penn Bancshares, Inc. | 116,578 | 1,944,521 | ||||||
NBT Bancorp, Inc. | 45,100 | 1,017,456 | ||||||
Old National Bancorp | 47,200 | 783,992 | ||||||
Pacific Capital Bancorp | 31,500 | 849,870 | ||||||
Peoples Bancorp, Inc. | 11,200 | 303,184 | ||||||
Prosperity Bancshares, Inc. | 13,400 | 438,984 | ||||||
Provident Bankshares Corp. | 58,800 | 1,927,464 | ||||||
R & G Financial Corp. ADR - PR* | 34,250 | 126,725 | ||||||
Renasant Corp. | 13,600 | 309,264 | ||||||
Republic Bancorp, Inc., Class A | 5,855 | 97,134 | ||||||
Royal Bancshares of Pennsylvania, Inc., Class A | 6,030 | 118,851 | ||||||
Santander Bancorp — PR | 2,500 | 37,150 | ||||||
SCBT Financial Corp. | 4,614 | 167,950 | ||||||
Security Bank Corp. | 11,200 | 225,120 | ||||||
Sierra Bancorp | 1,200 | 33,840 | ||||||
Signature Bank* | 80,150 | 2,733,115 | ||||||
Simmons First National Corp., Class A | 8,100 | 223,479 | ||||||
Southwest Bancorp | 32,800 | 788,512 | ||||||
Sterling Bancshares, Inc. | 51,700 | 584,727 | ||||||
Sterling Financial Corp. | 36,412 | 383,054 | ||||||
Sterling Financial Corp. (Spokane) | 67,505 | 1,953,595 | ||||||
Suffolk Bancorp | 5,500 | 175,560 | ||||||
Taylor Capital Group, Inc. | 10,400 | 286,312 | ||||||
TCF Financial Corp. | 123,800 | 3,441,640 | ||||||
Trico Bancshares | 11,000 | 245,960 | ||||||
UMB Financial Corp. | 83,600 | 3,082,332 | ||||||
Umpqua Holdings Corp. | 35,096 | 825,107 | ||||||
Union Bankinghares Corp. | 39,200 | 909,440 | ||||||
United Bankinghares, Inc. | 8,700 | 276,660 | ||||||
W Holding Co., Inc. | 79,991 | 211,176 | ||||||
Washington Trust Bancorp | 11,300 | 284,873 | ||||||
West Coast Bancorp | 42,900 | 1,303,731 | ||||||
57,627,353 | ||||||||
Commercial Services & Supplies (3.6%) | ||||||||
American Ecology Corp. | 108,580 | 2,325,784 | ||||||
Comsys IT Partners, Inc.* | 15,200 | 346,712 | ||||||
Consolidated Graphics, Inc.* | 10,400 | 720,512 | ||||||
CRA International, Inc.* | 4,800 | 231,360 | ||||||
Deluxe Corp. | 102,800 | 4,174,708 | ||||||
Ennis, Inc. | 8,600 | 202,272 | ||||||
FTI Consulting, Inc.* | 14,400 | 547,632 | ||||||
Geo Group, Inc. (The)* | 65,800 | 1,914,780 | ||||||
ICT Group, Inc.* | 80,750 | 1,510,832 | ||||||
IHS, Inc., Class A* | 37,540 | 1,726,840 | ||||||
IKON Office Solutions, Inc. | 69,300 | 1,081,773 | ||||||
Infinity Bio-Energy Ltd.* | 155,500 | 797,715 | ||||||
Kelly Services, Inc. | 14,300 | 392,678 | ||||||
Kforce, Inc.* | 24,300 | 388,314 | ||||||
Learning Tree International, Inc.* | 128,630 | 1,685,053 |
Nationwide Multi-Manager NVIT Small Cap Value Fund (Continued)
COMMON STOCK (continued) | ||||||||
Shares or | ||||||||
Principal Amount | Value | |||||||
Commercial Services & Supplies (continued) | ||||||||
LECG Corp.* | 39,100 | $ | 590,801 | |||||
Manhattan Associates, Inc.* | 20,200 | 563,782 | ||||||
Spherion Corp.* | 52,600 | 493,914 | ||||||
TeleTech Holdings, Inc.* | 30,600 | 993,888 | ||||||
United Stationers, Inc.* | 11,300 | 753,032 | ||||||
Viad Corp. | 19,700 | 830,749 | ||||||
Volt Information Sciences, Inc.* | 8,800 | 162,272 | ||||||
Waste Connections, Inc.* | 17,400 | 526,176 | ||||||
Watson Wyatt Worldwide, Inc. | 14,500 | 731,960 | ||||||
23,693,539 | ||||||||
Communications Equipment (2.6%) | ||||||||
ADC Telecommunications, Inc.* | 86,950 | 1,593,793 | ||||||
Arris Group, Inc.* | 169,540 | 2,982,209 | ||||||
Avocent Corp.* | 26,600 | 771,666 | ||||||
Bel Fuse, Inc., Class B | 11,100 | 377,733 | ||||||
Black Box Corp. | 13,300 | 550,354 | ||||||
C-COR, Inc.* | 6,600 | 92,796 | ||||||
Digi International, Inc.* | 18,800 | 277,112 | ||||||
Ditech Networks, Inc.* | 14,800 | 121,212 | ||||||
Dycom Industries, Inc.* | 54,520 | 1,634,510 | ||||||
Finisar Corp.* | 31,500 | 119,070 | ||||||
Foundry Networks, Inc.* | 21,700 | 361,522 | ||||||
Harmonic, Inc.* | 125,650 | 1,114,515 | ||||||
Inter-Tel, Inc. | 24,600 | 588,678 | ||||||
MasTec, Inc.* | 27,400 | 433,468 | ||||||
MRV Communications, Inc.* | 18,200 | 59,150 | ||||||
Ntelos Holding Corp. | 25,950 | 717,258 | ||||||
Polycom, Inc.* | 11,600 | 389,760 | ||||||
Powerwave Technologies, Inc.* | 703,800 | 4,715,460 | ||||||
Sycamore Networks, Inc.* | 34,100 | 137,082 | ||||||
U.T. Starcom, Inc.* | 21,500 | 120,615 | ||||||
17,157,963 | ||||||||
Computers & Peripherals (1.7%) | ||||||||
Adaptec, Inc.* | 25,700 | 97,917 | ||||||
Diebold, Inc. | 58,000 | 3,027,600 | ||||||
Electronics for Imaging, Inc.* | 36,100 | 1,018,742 | ||||||
Emulex Corp.* | 90,500 | 1,976,520 | ||||||
Gateway, Inc.* | 48,000 | 76,320 | ||||||
Hutchinson Technology, Inc.* | 12,100 | 227,601 | ||||||
Hypercom Corp.* | 381,100 | 2,252,301 | ||||||
Imation Corp. | 21,300 | 785,118 | ||||||
Komag, Inc.* | 12,200 | 389,058 | ||||||
Palm, Inc.* | 50,900 | 814,909 | ||||||
Quantum Corp.* | 45,700 | 144,869 | ||||||
10,810,955 | ||||||||
Construction & Engineering (0.5%) | ||||||||
Emcor Group, Inc.* | 9,600 | 699,840 | ||||||
Granite Construction, Inc. | 14,400 | 924,192 | ||||||
Washington Group International, Inc.* | 21,950 | 1,756,220 | ||||||
3,380,252 | ||||||||
Construction Materials (0.1%) | ||||||||
U.S. Concrete, Inc.* | 90,810 | 789,139 | ||||||
789,139 | ||||||||
Consumer Finance (1.0%) | ||||||||
Advance America Cash Advance Centers, Inc. | 9,600 | 170,304 | ||||||
Advanta Corp., Class B | 34,900 | 1,086,786 | ||||||
Cash America International, Inc. | 51,700 | 2,049,905 | ||||||
CompuCredit Corp.* | 9,300 | 325,686 | ||||||
Dollar Financial Corp.* | 50,123 | 1,428,506 | ||||||
World Acceptance Corp.* | 37,800 | 1,615,194 | ||||||
6,676,381 | ||||||||
Consumer Goods (0.3%) | ||||||||
1-800-Flowers.Com, Inc.* | 175,220 | 1,652,325 | ||||||
1,652,325 | ||||||||
Containers & Packaging (1.4%) | ||||||||
AptarGroup, Inc. | 16,000 | 568,960 | ||||||
Greif, Inc. | 23,100 | 1,376,991 | ||||||
Myers Industries, Inc. | 44,600 | 986,106 | ||||||
Rock-Tenn Co. | 41,100 | 1,303,692 | ||||||
Silgan Holdings, Inc. | 86,490 | 4,781,167 | ||||||
9,016,916 | ||||||||
Distributors (0.1%) | ||||||||
Keystone Automotive Industries, Inc.* | 7,700 | 318,549 | ||||||
318,549 | ||||||||
Diversified Consumer Services (0.7%) | ||||||||
Regis Corp. | 14,200 | 543,150 | ||||||
Service Corp. International | 186,630 | 2,385,131 | ||||||
Stewart Enterprises, Inc., Class A | 100,700 | 784,453 | ||||||
Vertrue, Inc.* | 19,000 | 926,820 | ||||||
4,639,554 | ||||||||
Diversified Financial Services (0.1%) | ||||||||
Financial Federal Corp. | 19,200 | 572,544 | ||||||
Marlin Business Services, Inc.* | 2,300 | 49,013 | ||||||
621,557 | ||||||||
COMMON STOCK (continued) | ||||||||
Shares or | ||||||||
Principal Amount | Value | |||||||
Diversified Telecommunication Services (1.3%) | ||||||||
Atlantic Tele-Network, Inc. | 6,500 | $ | 186,160 | |||||
Cincinnati Bell, Inc.* | 437,600 | 2,529,328 | ||||||
CT Communications, Inc. | �� | 45,600 | 1,391,256 | |||||
Fairpoint Communications, Inc. | 48,700 | 864,425 | ||||||
General Communication, Inc.* | 21,400 | 274,134 | ||||||
Iowa Telecommunications Services, Inc. | 24,600 | 559,158 | ||||||
North Pittsburgh Systems, Inc. | 10,400 | 221,000 | ||||||
Premiere Global Services, Inc.* | 149,100 | 1,941,282 | ||||||
SureWest Communications | 6,900 | 187,956 | ||||||
8,154,699 | ||||||||
Electric Utilities (1.9%) | ||||||||
Allete, Inc. | 20,200 | 950,410 | ||||||
Cleco Corp. | 32,900 | 806,050 | ||||||
El Paso Electric Co.* | 52,600 | 1,291,856 | ||||||
IDACORP, Inc. | 52,100 | 1,669,284 | ||||||
UIL Holdings Corp. | 15,833 | 524,072 | ||||||
UniSource Energy Corp. | 62,800 | 2,065,492 | ||||||
Westar Energy, Inc. | 215,450 | 5,231,126 | ||||||
12,538,290 | ||||||||
Electrical Equipment (1.2%) | ||||||||
A.O. Smith Corp. | 12,200 | 486,658 | ||||||
Acuity Brands, Inc. | 20,500 | 1,235,740 | ||||||
Belden CDT, Inc. | 11,300 | 625,455 | ||||||
Encore Wire Corp. | 57,650 | 1,697,216 | ||||||
Genlyte Group, Inc.* | 7,200 | 565,488 | ||||||
Graftech International Ltd.* | 124,000 | 2,088,160 | ||||||
Regal-Beloit Corp. | 25,600 | 1,191,424 | ||||||
7,890,141 | ||||||||
Electronic Equipment & Instruments (2.0%) | ||||||||
Aeroflex, Inc.* | 34,100 | 483,197 | ||||||
Agilysys, Inc. | 36,100 | 812,250 | ||||||
Anixter International, Inc.* | 15,900 | 1,195,839 | ||||||
Bell Microproducts, Inc.* | 99,700 | 650,044 | ||||||
Benchmark Electronics, Inc.* | 35,125 | 794,527 | ||||||
Checkpoint Systems, Inc.* | 15,700 | 396,425 | ||||||
Coherent, Inc.* | 8,700 | 265,437 | ||||||
CTS Corp. | 54,700 | 692,502 | ||||||
DTS, Inc.* | 102,710 | 2,235,997 | ||||||
Electro Scientific Industries, Inc.* | 3,400 | 70,720 | ||||||
Insight Enterprises, Inc.* | 27,000 | 609,390 | ||||||
Kemet Corp.* | 18,500 | 130,425 | ||||||
Newport Corp.* | 30,700 | 475,236 | ||||||
P.C. Connection Incorporated* | 17,700 | 234,348 | ||||||
Park Electrochemical Corp. | 8,900 | 250,802 | ||||||
Plexus Corp.* | 26,800 | 616,132 | ||||||
RadiSys Corp.* | 5,600 | 69,440 | ||||||
Synnex Corp.* | 3,300 | 68,013 | ||||||
Technitrol, Inc. | 94,300 | 2,703,581 | ||||||
TTM Technologies, Inc.* | 21,000 | 273,000 | ||||||
Zygo Corp.* | 11,000 | 157,190 | ||||||
13,184,495 | ||||||||
Energy Equipment & Services (1.8%) | ||||||||
Bristow Group, Inc.* | 10,100 | 500,455 | ||||||
Carbo Ceramics, Inc. | 9,700 | 424,957 | ||||||
Complete Production Services* | 30,500 | 788,425 | ||||||
Core Laboratories NV* | 8,100 | 823,689 | ||||||
Drill-Quip, Inc.* | 15,000 | 674,250 | ||||||
Hanover Compressor Co.* | 27,030 | 644,666 | ||||||
Oceaneering International, Inc.* | 34,810 | 1,832,398 | ||||||
Oil States International, Inc.* | 29,200 | 1,207,128 | ||||||
RPC Energy Services, Inc. | 60,687 | 1,034,106 | ||||||
Superior Well Services, Inc.* | 15,400 | 391,314 | ||||||
Trico Marine Services, Inc.* | 45,100 | 1,843,688 | ||||||
Union Drilling, Inc.* | 18,300 | 300,486 | ||||||
Universal Compression Holdings, Inc.* | 9,100 | 659,477 | ||||||
W-H Energy Services, Inc.* | 6,700 | 414,797 | ||||||
11,539,836 | ||||||||
Food & Staples Retailing (0.9%) | ||||||||
Andersons, Inc. (The) | 17,100 | 775,143 | ||||||
Nasch-Finch Co. | 35,700 | 1,767,150 | ||||||
Pantry, Inc.* | 10,000 | 461,000 | ||||||
Performance Food Group Co.* | 32,200 | 1,046,178 | ||||||
Ruddick Corp. | 6,500 | 195,780 | ||||||
Spartan Stores, Inc. | 49,700 | 1,635,627 | ||||||
5,880,878 | ||||||||
Food Products (0.3%) | ||||||||
Ralcorp Holding, Inc.* | 9,400 | 502,430 | ||||||
Reddy Ice Holdings, Inc. | 14,800 | 422,096 | ||||||
Tootsie Roll Industries, Inc. | 28,784 | 797,605 | ||||||
1,722,131 | ||||||||
Gas Distribution (0.2%) | ||||||||
Piedmont Natural Gas Co., Inc. | 47,500 | 1,170,875 | ||||||
1,170,875 | ||||||||
Gas Utilities (1.3%) | ||||||||
Laclede Group, Inc. (The) | 61,500 | 1,960,620 | ||||||
New Jersey Resources Corp. | 43,200 | 2,204,064 |
Nationwide Multi-Manager NVIT Small Cap Value Fund (Continued)
COMMON STOCK (continued) | ||||||||
Shares or | ||||||||
Principal Amount | Value | |||||||
Gas Utilities (continued) | ||||||||
NICOR, Inc. | 26,000 | $ | 1,115,920 | |||||
Northwest Natural Gas Co. | 100 | 4,619 | ||||||
South Jersey Industries, Inc. | 19,700 | 696,986 | ||||||
Southwest Gas Corp. | 61,500 | 2,079,315 | ||||||
UGI Corp. | 12,600 | 343,728 | ||||||
8,405,252 | ||||||||
Health Care Equipment & Supplies (1.7%) | ||||||||
CONMED Corp.* | 40,100 | 1,174,128 | ||||||
Cutera, Inc.* | 32,400 | 807,408 | ||||||
D.J. Orthopedics, Inc.* | 10,000 | 412,700 | ||||||
Greatbatch, Inc.* | 5,300 | 171,720 | ||||||
ICU Medical, Inc.* | 3,200 | 137,408 | ||||||
Invacare Corp. | 8,600 | 157,638 | ||||||
Inverness Medical Innovations, Inc.* | 60,670 | 3,095,383 | ||||||
IRIS International, Inc.* | 98,150 | 1,652,846 | ||||||
LifeCell Corp.* | 8,300 | 253,482 | ||||||
SonoSite, Inc.* | 74,850 | 2,352,536 | ||||||
Steris Corp. | 12,100 | 370,260 | ||||||
Surmodics, Inc.* | 1,200 | 60,000 | ||||||
Symmetry Medical, Inc.* | 16,000 | 256,160 | ||||||
10,901,669 | ||||||||
Health Care Providers & Services (2.5%) | ||||||||
Alliance Imaging, Inc.* | 59,900 | 562,461 | ||||||
American Dental Partners* | 14,000 | 363,580 | ||||||
Amerigroup Corp.* | 53,800 | 1,280,440 | ||||||
AMN Healthcare Services, Inc.* | 28,500 | 627,000 | ||||||
Apria Healthcare Group, Inc.* | 8,800 | 253,176 | ||||||
Five Star Quality Care, Inc.* | 163,100 | 1,301,538 | ||||||
Genesis HealthCare Corp.* | 600 | 41,052 | ||||||
Gentiva Health Services, Inc.* | 72,200 | 1,448,332 | ||||||
Healthspring, Inc.* | 26,600 | 506,996 | ||||||
Hythiam, Inc.* | 96,860 | 837,839 | ||||||
Kindred Healthcare, Inc.* | 20,900 | 642,048 | ||||||
Magellan Health Services, Inc.* | 17,600 | 817,872 | ||||||
Molina Healthcare, Inc.* | 6,100 | 186,172 | ||||||
Pediatrix Medical Group, Inc.* | 31,980 | 1,763,697 | ||||||
PSS World Medical, Inc.* | 30,900 | 562,998 | ||||||
Psychiatric Solutions, Inc.* | 31,000 | 1,124,060 | ||||||
Res-Care, Inc.* | 7,500 | 158,550 | ||||||
Rural/ Metro Corp.* | 277,206 | 1,582,846 | ||||||
Sunrise Senior Living, Inc.* | 43,840 | 1,753,162 | ||||||
Universal Health Services, Inc. | 5,600 | 344,400 | ||||||
16,158,219 | ||||||||
Hotels, Restaurants & Leisure (1.4%) | ||||||||
Ameristar Casinos, Inc. | 3,300 | 114,642 | ||||||
Bob Evans Farms, Inc. | 2,100 | 77,385 | ||||||
Domino’s Pizza, Inc. | 48,000 | 876,960 | ||||||
Great Wolf Resorts, Inc.* | 104,672 | 1,491,576 | ||||||
Jack in the Box, Inc.* | 30,200 | 2,142,388 | ||||||
Luby’s, Inc.* | 70,540 | 681,417 | ||||||
Multimedia Games, Inc.* | 129,270 | 1,649,485 | ||||||
Papa John’s International, Inc.* | 8,300 | 238,708 | ||||||
RARE Hospitality International, Inc.* | 16,600 | 444,382 | ||||||
Shuffle Master, Inc.* | 84,400 | 1,401,040 | ||||||
9,117,983 | ||||||||
Household Durables (0.9%) | ||||||||
Directed Electronics, Inc.* | 99,250 | 877,370 | ||||||
Ethan Allen Interiors, Inc. | 20,000 | 685,000 | ||||||
Kimball International, Inc., Class B | 24,100 | 337,641 | ||||||
Sealy Corp. | 23,900 | 394,828 | ||||||
Tupperware Corp. | 113,600 | 3,264,864 | ||||||
WCI Communities, Inc.* | 13,000 | 216,840 | ||||||
5,776,543 | ||||||||
Insurance (4.5%) | ||||||||
American Physicians Capital, Inc.* | 10,900 | 441,450 | ||||||
Amerisafe, Inc.* | 19,900 | 390,637 | ||||||
Argonaut Group, Inc. | 27,500 | 858,275 | ||||||
Aspen Insurance Holdings Ltd. - BM | 55,600 | 1,560,692 | ||||||
CNA Surety Corp.* | 56,790 | 1,073,899 | ||||||
Commerce Group, Inc. | 26,000 | 902,720 | ||||||
Delphi Financial Group, Inc., Class A | 56,475 | 2,361,784 | ||||||
First Mercury Financial Corp.* | 40,000 | 838,800 | ||||||
FPIC Insurance Group, Inc.* | 9,400 | 383,238 | ||||||
Harleysville Group, Inc. | 11,900 | 396,984 | ||||||
Infinity Property & Casualty Corp. | 14,900 | 755,877 | ||||||
IPC Holdings Ltd. — BM | 27,200 | 878,288 | ||||||
James River Group, Inc. | 3,400 | 112,982 | ||||||
LandAmerica Financial Group, Inc. | 16,500 | 1,592,085 | ||||||
Max Re Capital Ltd. | 51,600 | 1,460,280 | ||||||
Navigators Group, Inc. (The)* | 13,200 | 711,480 | ||||||
Odyssey Re Holdings Corp. | 83,400 | 3,577,026 | ||||||
Ohio Casualty Corp. | 26,900 | 1,165,039 | ||||||
Phoenix Co., Inc. | 13,300 | 199,633 | ||||||
Platinum Underwriters Holdings Ltd. - BM | 55,000 | 1,911,250 | ||||||
PMA Capital Corp., Class A* | 104,000 | 1,111,760 | ||||||
ProAssurance Corp.* | 2,000 | 111,340 | ||||||
RLI Corp. | 3,700 | 207,015 | ||||||
Safety Insurance Group, Inc. | 28,100 | 1,163,340 | ||||||
Seabright Insurance Holdings* | 17,800 | 311,144 |
COMMON STOCK (continued) | ||||||||
Shares or | ||||||||
Principal Amount | Value | |||||||
Insurance (continued) | ||||||||
Selective Insurance Group, Inc. | 40,900 | $ | 1,099,392 | |||||
Stewart Information Services Corp. | 16,000 | 637,280 | ||||||
United Fire & Casualty Corp. | 17,440 | 617,027 | ||||||
Zenith National Insurance Co. | 48,550 | 2,286,220 | ||||||
29,116,937 | ||||||||
Internet & Catalog Retail (0.4%) | ||||||||
FTD Group, Inc. | 108,600 | 1,999,326 | ||||||
Systemax, Inc. | 22,500 | 468,225 | ||||||
2,467,551 | ||||||||
Internet Software & Services (0.6%) | ||||||||
Ariba, Inc.* | 87,200 | 864,152 | ||||||
Interwoven, Inc.* | 36,300 | 509,652 | ||||||
iPass, Inc.* | 4,100 | 22,222 | ||||||
SonicWALL, Inc.* | 109,100 | 937,169 | ||||||
United Online, Inc. | 80,400 | 1,325,796 | ||||||
3,658,991 | ||||||||
IT Services (1.9%) | ||||||||
Authorize.Net Holdings, Inc.* | 15,300 | 273,717 | ||||||
CACI International, Inc., Class A* | 5,500 | 268,675 | ||||||
Ciber, Inc.* | 42,200 | 345,196 | ||||||
Covansys Corp.* | 24,400 | 827,892 | ||||||
CSG Systems International, Inc.* | 19,300 | 511,643 | ||||||
Forrester Research, Inc.* | 20,000 | 562,600 | ||||||
Gartner, Inc. * | 33,400 | 821,306 | ||||||
Infocrossing, Inc.* | 227,220 | 4,196,753 | ||||||
infoUSA, Inc. | 5,000 | 51,100 | ||||||
ManTech International Corp.* | 10,400 | 320,632 | ||||||
Ness Technologies, Inc.* | 55,370 | 720,364 | ||||||
Perot Systems Corp., Class A* | 45,600 | 777,024 | ||||||
Sapient Corp.* | 232,060 | 1,793,824 | ||||||
SI International, Inc.* | 6,500 | 214,630 | ||||||
Sykes Enterprises, Inc.* | 19,200 | 364,608 | ||||||
12,049,964 | ||||||||
Leisure Equipment & Products (0.8%) | ||||||||
JAKKS Pacific, Inc.* | 69,400 | 1,952,916 | ||||||
K2, Inc.* | 73,100 | 1,110,389 | ||||||
Pool Corp. | 26,050 | 1,016,732 | ||||||
RC2 Corp.* | 16,800 | 672,168 | ||||||
Steinway Musical Instruments, Inc. | 13,700 | 473,883 | ||||||
5,226,088 | ||||||||
Life Sciences Tools & Services (0.1%) | ||||||||
Bruker Bioscience Corp.* | 46,000 | 414,460 | ||||||
PAREXEL International Corp.* | 6,100 | 256,566 | ||||||
671,026 | ||||||||
Machinery (3.0%) | ||||||||
Actuant Corp. | 10,400 | 655,824 | ||||||
Astec Industries, Inc.* | 5,400 | 227,988 | ||||||
Barnes Group, Inc. | 66,300 | 2,100,384 | ||||||
Cascade Corp. | 11,600 | 909,904 | ||||||
Circor International, Inc. | 12,800 | 517,504 | ||||||
Enpro Industries, Inc.* | 46,900 | 2,006,851 | ||||||
Federal Signal Corp. | 20,700 | 328,302 | ||||||
Gehl Co.* | 6,100 | 185,196 | ||||||
Graco, Inc. | 6,900 | 277,932 | ||||||
Hardinge, Inc. | 13,200 | 449,196 | ||||||
Harsco Corp. | 10,100 | 525,200 | ||||||
Idex Corp. | 5,000 | 192,700 | ||||||
Kadant, Inc.* | 5,900 | 184,080 | ||||||
Kennametal, Inc. | 16,350 | 1,341,190 | ||||||
Manitowoc Co. | 8,100 | 651,078 | ||||||
Mueller Industries, Inc. | 9,600 | 330,624 | ||||||
NACCO Industries, Inc., Class A | 4,400 | 684,156 | ||||||
Tennant Co. | 11,900 | 434,350 | ||||||
Toro Co. | 52,500 | 3,091,725 | ||||||
Valmont Industries, Inc. | 22,600 | 1,644,376 | ||||||
Wabash National Corp. | 72,020 | 1,053,653 | ||||||
Wabtec Corp. | 40,800 | 1,490,424 | ||||||
Watts Industries, Inc. | 13,700 | 513,339 | ||||||
19,795,976 | ||||||||
Manufacturing (0.2%) | ||||||||
Blount International, Inc.* | 40,500 | 529,740 | ||||||
L.B. Foster Co.* | 29,100 | 834,588 | ||||||
1,364,328 | ||||||||
Marine (0.8%) | ||||||||
Eagle Bulk Shipping, Inc. | 29,500 | 661,095 | ||||||
Genco Shipping & Trading Ltd. - MH | 18,300 | 755,058 | ||||||
Omega Navigation Enterprises, Inc. | 134,100 | 2,916,675 | ||||||
TBS International Ltd. - BM* | 28,700 | 815,080 | ||||||
5,147,908 | ||||||||
Media (2.0%) | ||||||||
Arbitron, Inc. | 57,250 | 2,950,092 | ||||||
Cox Radio, Inc.* | 49,500 | 704,880 | ||||||
DreamWorks Animation SKG, Inc., Class A* | 25,500 | 735,420 |
Nationwide Multi-Manager NVIT Small Cap Value Fund (Continued)
COMMON STOCK (continued) | ||||||||
Shares or | ||||||||
Principal Amount | Value | |||||||
Media (continued) | ||||||||
Emmis Communications Corp. | 30,400 | $ | 279,984 | |||||
Entercom Communications Corp. | 32,500 | 808,925 | ||||||
Lee Enterprises, Inc. | 77,100 | 1,608,306 | ||||||
Lin TV Corp., Class A* | 17,000 | 319,770 | ||||||
LodgeNet Entertainment Corp.* | 40,500 | 1,298,430 | ||||||
Media General, Inc. | 2,900 | 96,483 | ||||||
Morningstar, Inc.* | 32,100 | 1,509,503 | ||||||
Radio One, Inc.* | 113,100 | 798,486 | ||||||
Scholastic Corp.* | 40,400 | 1,451,976 | ||||||
Sinclair Broadcast Group, Inc. | 6,300 | 89,586 | ||||||
Valassis Communications, Inc.* | 10,700 | 183,933 | ||||||
Westwood One, Inc. | 41,900 | 301,261 | ||||||
13,137,035 | ||||||||
Metals & Mining (2.0%) | ||||||||
A.M. Castle & Co. | 50,000 | 1,795,500 | ||||||
Century Aluminum Co.* | 47,000 | 2,567,610 | ||||||
Commercial Metals Co. | 20,300 | 685,531 | ||||||
Compass Minerals International, Inc. | 15,300 | 530,298 | ||||||
Gold Reserve, Inc.* | 131,800 | 735,444 | ||||||
Grupo Simec, SA de C.V. ADR - MX* | 94,200 | 1,175,616 | ||||||
IAMGOLD Corp. | 48,000 | 367,680 | ||||||
NN, Inc. | 13,100 | 154,580 | ||||||
Quanex Corp. | 35,900 | 1,748,330 | ||||||
Reliance Steel & Aluminum Co. | 8,300 | 466,958 | ||||||
Royal Gold, Inc. | 25,500 | 606,135 | ||||||
Ryerson, Inc. | 7,600 | 286,140 | ||||||
Schnitzer Steel Industries, Inc. | 8,900 | 426,666 | ||||||
Worthington Industries, Inc. | 57,100 | 1,236,215 | ||||||
12,782,703 | ||||||||
Multi-Utilities (1.0%) | ||||||||
Avista Corp. | 82,000 | 1,767,100 | ||||||
Black Hills Corp. | 5,700 | 226,575 | ||||||
C.H. Energy Group, Inc. | 11,600 | 521,652 | ||||||
PNM, Inc. | 56,000 | 1,556,240 | ||||||
Vectren Corp. | 92,250 | 2,484,293 | ||||||
6,555,860 | ||||||||
Multiline Retail (0.2%) | ||||||||
Bon-Ton Stores, Inc. | 12,200 | 488,732 | ||||||
Retail Ventures, Inc.* | 24,500 | 395,185 | ||||||
Tuesday Morning Corp. | 34,800 | 430,128 | ||||||
1,314,045 | ||||||||
Oil, Gas & Consumable Fuels (2.5%) | ||||||||
Alon U.S.A. Energy, Inc. | 43,400 | 1,910,034 | ||||||
Aurora Oil & Gas Corp.* | 24,700 | 52,611 | ||||||
Bois d’Arc Energy, Inc.* | 15,400 | 262,262 | ||||||
Cabot Oil & Gas Corp. | 7,600 | 280,288 | ||||||
Callon Petroleum Corp.* | 8,200 | 116,194 | ||||||
Cimarex Energy Co. | 12,500 | 492,625 | ||||||
Comstock Resources, Inc.* | 29,200 | 875,124 | ||||||
Energy Partners Ltd.* | 15,656 | 261,299 | ||||||
Evergreen Energy, Inc.* | 183,240 | 1,104,937 | ||||||
Foundation Coal Holdings, Inc. | 39,670 | 1,612,189 | ||||||
Gulf Island Fabrication, Inc. | 12,900 | 447,630 | ||||||
Harvest Natural Resources, Inc.* | 31,300 | 372,783 | ||||||
Helix Energy Solutions Group, Inc.* | 10,700 | 427,037 | ||||||
Petrohawk Energy Corp.* | 23,900 | 379,054 | ||||||
RAM Energy Resources, Inc.* | 343,580 | 1,862,203 | ||||||
Rossetta Resources, Inc.* | 14,200 | 305,868 | ||||||
St. Mary Land & Exploration Co. | 30,200 | 1,105,924 | ||||||
Stone Energy Corp.* | 35,500 | 1,216,230 | ||||||
Swift Energy Co.* | 19,300 | 825,268 | ||||||
USEC, Inc.* | 6,000 | 131,880 | ||||||
Warren Resources, Inc.* | 194,840 | 2,275,731 | ||||||
16,317,171 | ||||||||
Paper & Forest Products (0.5%) | ||||||||
Buckeye Technologies, Inc.* | 93,400 | 1,444,898 | ||||||
Schweitzer-Mauduit International, Inc. | 61,000 | 1,891,000 | ||||||
3,335,898 | ||||||||
Personal Products (0.6%) | ||||||||
Elizabeth Arden, Inc.* | 50,800 | 1,232,408 | ||||||
Physicians Formula Holdings, Inc.* | 72,070 | 1,133,301 | ||||||
Prestige Brands Holdings, Inc.* | 136,800 | 1,775,664 | ||||||
4,141,373 | ||||||||
Pharmaceuticals (0.9%) | ||||||||
Acadia Pharmaceuticals, Inc.* | 11,600 | 158,572 | ||||||
Adams Respiratory Therapeutics, Inc.* | 8,500 | 334,815 | ||||||
Alpharma, Inc., Class A | 9,400 | 244,494 | ||||||
Arena Pharmaceuticals, Inc.* | 5,300 | 58,247 | ||||||
Auxilium Pharmaceuticals, Inc.* | 11,500 | 183,310 | ||||||
Bradley Pharmaceutical* | 8,700 | 188,877 | ||||||
Cubist Pharmaceuticals, Inc.* | 9,400 | 185,274 | ||||||
Cypress Bioscience, Inc.* | 26,700 | 354,042 | ||||||
Endo Pharmaceuticals Holdings, Inc.* | 45,150 | 1,545,485 | ||||||
K-V Pharmaceutical Co.* | 880 | 23,971 |
COMMON STOCK (continued) | ||||||||
Shares or | ||||||||
Principal Amount | Value | |||||||
Pharmaceuticals (continued) | ||||||||
Onyx Pharmaceuticals, Inc.* | 24,500 | $ | 659,050 | |||||
Par Pharmaceutical Cos., Inc.* | 6,700 | 189,141 | ||||||
Perrigo Co. | 21,400 | 419,012 | ||||||
Progenics Pharmaceuticals, Inc.* | 11,900 | 256,683 | ||||||
Regeneron Pharmaceuticals, Inc.* | 5,900 | 105,728 | ||||||
Savient Pharmaceuticals, Inc.* | 20,400 | 253,368 | ||||||
Valeant Pharmaceuticals International | 10,700 | 178,583 | ||||||
Viropharma, Inc.* | 37,000 | 510,600 | ||||||
5,849,252 | ||||||||
Real Estate Investment Trusts (REITs) (9.6%) | ||||||||
American Financial Realty Trust | 87,400 | 901,968 | ||||||
American Home Mortgage Investment Corp. | 78,489 | 1,442,628 | ||||||
Anthracite Capital, Inc. | 108,300 | 1,267,110 | ||||||
Arbor Realty Trust, Inc. | 25,700 | 663,317 | ||||||
Ashford Hospitality Trust | 407,480 | 4,791,965 | ||||||
Biomed Realty Trust, Inc. | 32,500 | 816,400 | ||||||
Capital Trust, Inc., Class A | 10,100 | 344,814 | ||||||
CBL & Associates Properties, Inc. | 36,200 | 1,305,010 | ||||||
CBRE Realty Finance, Inc. | 160,100 | 1,903,589 | ||||||
Cedarshopping Centers, Inc. | 73,100 | 1,048,985 | ||||||
Deerfield Triarc Capital Corp. | 74,900 | 1,095,787 | ||||||
Education Realty Trust, Inc. | 86,850 | 1,218,505 | ||||||
Entertainment Properties Trust | 10,720 | 576,522 | ||||||
Equity Inns, Inc. | 91,800 | 2,056,320 | ||||||
Equity Lifestyle Properties, Inc. | 16,700 | 871,573 | ||||||
Extra Space Storage, Inc. | 10,100 | 166,650 | ||||||
Felcor Lodging Trust, Inc. | 117,300 | 3,053,319 | ||||||
First Industrial Realty Trust | 61,920 | 2,400,019 | ||||||
First Potomac Realty Trust | 32,600 | 759,254 | ||||||
Glimcher Realty Trust | 26,000 | 650,000 | ||||||
Gramercy Capital Corp. | 11,600 | 319,464 | ||||||
Healthcare Realty Trust, Inc. | 22,100 | 613,938 | ||||||
Hersha Hospitality Trust | 134,300 | 1,587,426 | ||||||
Highland Hospitality Corp. | 29,400 | 564,480 | ||||||
Home Properties of New York, Inc. | 6,200 | 321,966 | ||||||
Impac Mortgage Holdings | 44,600 | 205,606 | ||||||
Inland Real Estate Corp. | 79,800 | 1,355,004 | ||||||
InnKeepers U.S.A. Trust | 95,400 | 1,691,442 | ||||||
Lasalle Hotel Properties | 11,700 | 508,014 | ||||||
Lexington Corporate Properties Trust | 211,800 | 4,405,440 | ||||||
LTC Properties, Inc. | 40,800 | 928,200 | ||||||
Mack-Cali Realty Corp. | 33,500 | 1,456,915 | ||||||
Maguire Properties, Inc. | 15,500 | 532,115 | ||||||
MFA Mortgage Investments, Inc. | 30,500 | 222,040 | ||||||
National Retail Properties, Inc. | 24,110 | 527,045 | ||||||
Nationwide Health Properties, Inc. | 14,200 | 386,240 | ||||||
Northstar Realty Finance Corp. | 187,610 | 2,347,001 | ||||||
Omega Healthcare Investors, Inc. | 73,080 | 1,156,856 | ||||||
Parkway Properties, Inc. | 31,000 | 1,488,930 | ||||||
Pennsylvania Real Estate Investment Trust | 56,300 | 2,495,779 | ||||||
Post Properties, Inc. | 50,000 | 2,606,500 | ||||||
Quadra Realty Trust, Inc.* | 167,440 | 2,094,674 | ||||||
Saul Centers, Inc. | 25,100 | 1,138,285 | ||||||
Senior Housing Properties Trust | 57,500 | 1,170,125 | ||||||
Spirit Finance Corp. | 129,200 | 1,881,152 | ||||||
Sunstone Hotel Investors, Inc. | 55,500 | 1,575,645 | ||||||
Urstadt Biddle Properties | 34,000 | 578,340 | ||||||
Washington Real Estate Investment Trust | 27,700 | 941,800 | ||||||
Winston Hotels, Inc. | 28,500 | 427,500 | ||||||
62,861,657 | ||||||||
Real Estate Management & Development (0.1%) | ||||||||
SonomaWest Holdings, Inc.* | 2,400 | 63,600 | ||||||
Tejon Ranch Co.* | 19,200 | 848,640 | ||||||
912,240 | ||||||||
Road & Rail (0.5%) | ||||||||
Arkansas Best Corp. | 3,500 | 136,395 | ||||||
Florida East Coast Industries, Inc. | 40,610 | 3,369,818 | ||||||
3,506,213 | ||||||||
Semiconductors & Semiconductor Equipment (2.5%) | ||||||||
Actel Corp.* | 13,200 | 183,612 | ||||||
Advanced Energy Industries, Inc.* | 14,800 | 335,368 | ||||||
Amis Holdings, Inc.* | 27,000 | 338,040 | ||||||
Amkor Technology, Inc.* | 46,800 | 737,100 | ||||||
Applied Micro Circuits Corp.* | 45,000 | 112,500 | ||||||
Asyst Technologies, Inc.* | 52,800 | 381,744 | ||||||
Axcelis Technologies, Inc.* | 45,100 | 292,699 | ||||||
Brooks Automation, Inc.* | 44,800 | 813,120 | ||||||
Cirrus Logic, Inc.* | 32,400 | 268,920 | ||||||
Cohu, Inc. | 14,900 | 331,525 | ||||||
Credence Systems Corp.* | 28,200 | 101,520 | ||||||
Cypress Semiconductor Corp.* | 102,150 | 2,379,074 | ||||||
DSP Group, Inc.* | 13,300 | 272,251 | ||||||
Eagle Test Systems, Inc.* | 8,700 | 139,722 | ||||||
Entegris, Inc.* | 53,338 | 633,655 | ||||||
Genesis Microchip, Inc.* | 8,300 | 77,688 | ||||||
Kulicke & Soffa Industries, Inc.* | 23,600 | 247,092 | ||||||
Lattice Semiconductor Corp.* | 29,800 | 170,456 |
Nationwide Multi-Manager NVIT Small Cap Value Fund (Continued)
COMMON STOCK (continued) | ||||||||
Shares or | ||||||||
Principal Amount | Value | |||||||
Semiconductors & Semiconductor Equipment (continued) | ||||||||
Mattson Technology, Inc.* | 11,700 | $ | 113,490 | |||||
Microsemi* | 10,000 | 239,500 | ||||||
MKS Instruments, Inc.* | 25,400 | 703,580 | ||||||
On Semiconductor Corp.* | 37,200 | 398,784 | ||||||
Pericom Semiconductor Corp.* | 7,400 | 82,584 | ||||||
Photronics, Inc.* | 45,700 | 680,016 | ||||||
RF Micro Devices, Inc.* | 27,200 | 169,728 | ||||||
Silicon Image, Inc.* | 344,050 | 2,951,949 | ||||||
Silicon Laboratories, Inc.* | 11,000 | 380,710 | ||||||
Silicon Storage Technology, Inc.* | 18,100 | 67,513 | ||||||
Skyworks Solutions, Inc.* | 31,200 | 229,320 | ||||||
Spansion, Inc., Class A* | 20,000 | 222,000 | ||||||
Standard Microsystems Corp.* | 14,300 | 491,062 | ||||||
TriQuint Semiconductor, Inc.* | 110,000 | 556,600 | ||||||
Zoran Corp.* | 70,300 | 1,408,812 | ||||||
16,511,734 | ||||||||
Service Companies (0.1%) | ||||||||
Heidrick & Struggles International, Inc.* | 5,760 | 295,142 | ||||||
295,142 | ||||||||
Software (3.4%) | ||||||||
Actuate Corp.* | 252,600 | 1,715,154 | ||||||
Aspen Technology, Inc.* | 39,000 | 546,000 | ||||||
Citrix Systems, Inc.* | 42,300 | 1,424,241 | ||||||
Corel Corp. ADR — CA* | 68,318 | 905,214 | ||||||
Fair Issac Corp. | 75,250 | 3,019,030 | ||||||
Henry (Jack) & Associates, Inc. | 11,500 | 296,125 | ||||||
Lawson Software, Inc.* | 42,700 | 422,303 | ||||||
Macrovision Corp.* | 68,100 | 2,047,086 | ||||||
Magma Design Automation, Inc.* | 21,800 | 306,072 | ||||||
Mentor Graphics Corp.* | 51,200 | 674,304 | ||||||
NAVTEQ Corp.* | 8,900 | 376,826 | ||||||
Parametric Technology Corp.* | 36,520 | 789,197 | ||||||
Progress Software Corp.* | 15,100 | 480,029 | ||||||
QAD, Inc. | 7,400 | 61,420 | ||||||
Quest Software, Inc.* | 15,800 | 255,802 | ||||||
SPSS, Inc.* | 3,100 | 136,834 | ||||||
Sybase, Inc.* | 183,450 | 4,382,620 | ||||||
THQ, Inc.* | 99,250 | 3,029,110 | ||||||
Tibco Software, Inc.* | 175,090 | 1,584,565 | ||||||
22,451,932 | ||||||||
Specialty Retail (2.9%) | ||||||||
Aaron Rents, Inc. | 6,350 | 185,420 | ||||||
Asbury Automotive Group, Inc. | 74,300 | 1,853,785 | ||||||
Charming Shoppes* | 198,400 | 2,148,672 | ||||||
Circuit City Stores, Inc. | 153,900 | 2,320,812 | ||||||
CSK Auto Corp.* | 39,300 | 723,120 | ||||||
Dress Barn, Inc.* | 15,000 | 307,800 | ||||||
DSW Inc., Class A* | 3,000 | 104,460 | ||||||
Finish Line, Inc., Class A (The) | 115,800 | 1,054,938 | ||||||
Group 1 Automotive, Inc. | 39,500 | 1,593,430 | ||||||
Guitar Center, Inc.* | 31,100 | 1,860,091 | ||||||
Hibbett Sports, Inc.* | 14,600 | 399,748 | ||||||
Lithia Motors, Inc., Class A | 7,500 | 190,050 | ||||||
MarineMax, Inc.* | 16,300 | 326,326 | ||||||
Payless ShoeSource, Inc.* | 35,600 | 1,123,180 | ||||||
Rent-A-Center, Inc.* | 50,400 | 1,321,992 | ||||||
Shoe Carnival, Inc.* | 6,900 | 189,681 | ||||||
Sonic Automotive, Inc. | 17,000 | 492,490 | ||||||
Stage Stores, Inc. | 47,125 | 987,740 | ||||||
Stein Mart, Inc. | 28,700 | 351,862 | ||||||
Talbots, Inc. | 30,200 | 755,906 | ||||||
Tractor Supply Co.* | 12,000 | 624,600 | ||||||
Tween Brands, Inc.* | 2,900 | 129,340 | ||||||
19,045,443 | ||||||||
Textiles, Apparel & Luxury Goods (1.9%) | ||||||||
Brown Shoe Co., Inc. | 61,400 | 1,493,248 | ||||||
Deckers Outdoor Corp.* | 5,000 | 504,500 | ||||||
Hartmarx Corp.* | 1,600 | 12,752 | ||||||
Heelys, Inc.* | 18,300 | 473,238 | ||||||
Kellwood Co. | 78,700 | 2,213,044 | ||||||
Maidenform Brands, Inc.* | 32,900 | 653,394 | ||||||
Movado Group, Inc. | 11,400 | 384,636 | ||||||
Oxford Industries, Inc. | 2,500 | 110,850 | ||||||
Perry Ellis International, Inc.* | 36,250 | 1,166,162 | ||||||
Phillips-Van Heusen Corp. | 25,600 | 1,550,592 | ||||||
Skechers U.S.A., Inc.* | 27,100 | 791,320 | ||||||
Stride Rite Corp. | 67,350 | 1,364,511 | ||||||
UniFirst Corp. | 12,900 | 568,245 | ||||||
Warnaco Group, Inc. (The)* | 14,900 | 586,166 | ||||||
Wolverine World Wide, Inc. | 28,900 | 800,819 | ||||||
12,673,477 | ||||||||
Thrifts & Mortgage Finance (1.7%) | ||||||||
BankUnited Financial Corp., Class A | 19,600 | 393,372 | ||||||
Berkshire Hills Bancorp, Inc. | 1,000 | 31,510 | ||||||
Centerline Holding Co. | 20,900 | 376,200 | ||||||
City Bank | 16,500 | 519,915 | ||||||
Corus Bankshares, Inc. | 76,600 | 1,322,116 | ||||||
Dime Community Bancshares | 18,650 | 245,993 | ||||||
Downey Financial Corp. | 13,300 | 877,534 |
COMMON STOCK (continued) | ||||||||
Shares or | ||||||||
Principal Amount | Value | |||||||
Thrifts & Mortgage Finance (continued) | ||||||||
Federal Agricultural Mortgage Corp., Class C | 5,400 | $ | 184,788 | |||||
First Financial Holdings, Inc. | 11,800 | 385,978 | ||||||
First Niagara Financial Group, Inc. | 78,996 | 1,034,848 | ||||||
First Place Financial Corp. | 10,900 | 230,208 | ||||||
FirstFed Financial Corp.* | 12,000 | 680,760 | ||||||
Flagstar Bancorp | 22,900 | 275,945 | ||||||
Franklin Bank Corp.* | 51,600 | 768,840 | ||||||
ITLA Capital Corp. | 5,300 | 276,236 | ||||||
MAF Bancorp, Inc. | 21,043 | 1,141,793 | ||||||
Ocwen Financial Corp.* | 23,300 | 310,589 | ||||||
Partners Trust Financial Group | 21,100 | 221,550 | ||||||
Tierone Corp. | 23,300 | 701,330 | ||||||
TrustCo Bank Corp. | 36,400 | 359,632 | ||||||
United Community Financial Corp. | 30,100 | 300,398 | ||||||
WSFS Financial Corp. | 9,000 | 588,870 | ||||||
11,228,405 | ||||||||
Tobacco (0.6%) | ||||||||
Alliance One International, Inc.* | 266,300 | 2,676,315 | ||||||
Universal Corp. | 16,700 | 1,017,364 | ||||||
3,693,679 | ||||||||
Trading Companies & Distributors (1.1%) | ||||||||
Applied Industrial Technologies, Inc. | 98,950 | 2,919,025 | ||||||
Beacon Roofing Supply, Inc.* | 42,010 | 713,750 | ||||||
Electro Rent Corp. | 4,900 | 71,246 | ||||||
Interline Brands, Inc.* | 20,400 | 532,032 | ||||||
Kaman Corp., Class A | 53,500 | 1,668,665 | ||||||
MSC Industrial Direct Co., Class A | 5,000 | 275,000 | ||||||
UAP Holding Corp. | 22,800 | 687,192 | ||||||
Watsco, Inc. | 7,700 | 418,880 | ||||||
7,285,790 | ||||||||
Transportation (1.3%) | ||||||||
Genesis Lease Ltd. ADR - IE | 92,000 | 2,520,800 | ||||||
GulfMark Offshore Services, Inc.* | 65,200 | 3,339,544 | ||||||
Knightsbridge Tankers Ltd. - BR | 17,800 | 543,078 | ||||||
SEACOR Holdings, Inc.* | 20,850 | 1,946,556 | ||||||
8,349,978 | ||||||||
Water Utilities (0.1%) | ||||||||
American States Water Co. | 7,700 | 273,889 | ||||||
SJW Corp. | 15,600 | 519,480 | ||||||
793,369 | ||||||||
Wireless Telecommunication Services (0.1%) | ||||||||
Centennial Communications* | 21,600 | 204,984 | ||||||
Dobson Communications Corp., Class A* | 56,600 | 628,826 | ||||||
833,810 | ||||||||
Total Common Stocks (Cost $557,815,928) | 632,873,969 | |||||||
U.S. TREASURY NOTE (0.1%) | ||||||||
U.S. Treasury Notes, 4.25%, 11/30/07 | $ | 660,000 | 658,247 | |||||
CASH EQUIVALENT (2.2%)(a) | ||||||||
AIM Liquid Assets Portfolio, 5.09%, 04/01/42 | 14,143,415 | 14,143,415 | ||||||
Total Investments (Cost $572,617,510) (b) — 99.3% | 647,675,631 | |||||||
Other assets in excess of liabilities — 0.7% | 4,398,804 | |||||||
NET ASSETS — 100.0% | $ | 652,074,435 | ||||||
* | Denotes a non-income producing security. |
(a) | Variable Rate Security. The rate reflected in the Statement of Investments is the rate in effect on June 30, 2007. The maturity date represents the actual maturity date. | |
(b) | See notes to financial statements for tax unrealized appreciation (depreciation) of securities. |
ADR | American Depository Receipt | |
BR | Brazil | |
CA | Canada | |
IE | Ireland | |
MH | Marshall Islands | |
MX | Mexico | |
PA | Panama | |
PR | Puerto Rico |
At June 30, 2007, the Fund’s open futures contracts were as follows:
Market Value | Unrealized | |||||||||||||||
Number of | Covered by | Appreciation/ | ||||||||||||||
Contracts | Long Contracts | Expiration | Contracts | Depreciation | ||||||||||||
20 | Rusell 2000 Future | 09/21/07 | $ | 8,421,000 | $ | (166,495 | ) | |||||||||
Nationwide | ||||||
Multi-Manager | ||||||
NVIT Small Cap | ||||||
Value Fund | ||||||
Assets: | ||||||
Investments, at value (cost $572,617,510) | $ | 647,675,631 | ||||
Cash | 4,755,758 | |||||
Interest and dividends receivable | 1,135,023 | |||||
Receivable for capital shares issued | 172,839 | |||||
Receivable for investments sold | 201,294 | |||||
Prepaid expenses | 6,827 | |||||
Total Assets | 653,947,372 | |||||
Liabilities: | ||||||
Payable for variation margin on futures contracts | 32,000 | |||||
Payable for investments purchased | 488,713 | |||||
Payable for capital shares redeemed | 717,006 | |||||
Accrued expenses and other payables: | ||||||
Investment advisory fees | 471,610 | |||||
Fund administration and transfer agent fees | 48,096 | |||||
Distribution fees | 10,058 | |||||
Administrative servicing fees | 64,673 | |||||
Compliance program costs | 9,046 | |||||
Other | 31,735 | |||||
Total Liabilities | 1,872,937 | |||||
Net Assets | $ | 652,074,435 | ||||
Represented by: | ||||||
Capital | $ | 529,827,105 | ||||
Accumulated net investment income | 3,030,520 | |||||
Accumulated net realized gains from investment transactions and futures | 43,963,005 | |||||
Net unrealized appreciation on investments and futures | 75,253,805 | |||||
Net Assets | $ | 652,074,435 | ||||
Net Assets: | ||||||
Class I Shares | $ | 550,178,777 | ||||
Class II Shares | 48,342,359 | |||||
Class III Shares | 1,331,470 | |||||
Class IV Shares | 52,221,829 | |||||
Total | $ | 652,074,435 | ||||
Shares outstanding (unlimited number of shares authorized): | ||||||
Class I Shares | 42,510,029 | |||||
Class II Shares | 3,773,747 | |||||
Class III Shares | 102,708 | |||||
Class IV Shares | 4,035,010 | |||||
Total | 50,421,494 | |||||
Net asset value and offering price per share (Net assets by class divided by shares outstanding by class, respectively.): | ||||||
Class I Shares | $ | 12.94 | ||||
Class II Shares | $ | 12.81 | ||||
Class III Shares | $ | 12.96 | ||||
Class IV Shares | $ | 12.94 | ||||
16
Nationwide | |||||
Multi-Manager | |||||
NVIT Small Cap | |||||
Value Fund | |||||
INVESTMENT INCOME: | |||||
Interest income | $ | 451,364 | |||
Dividend income | 7,515,190 | ||||
Total Income | 7,966,554 | ||||
Expenses: | |||||
Investment advisory fees | 2,891,102 | ||||
Fund administration and transfer agent fees | 217,578 | ||||
Distribution fees Class II Shares | 64,162 | ||||
Administrative servicing fees Class I Shares | 403,597 | ||||
Administrative servicing fees Class II Shares | 38,371 | ||||
Administrative servicing fees Class III Shares | 936 | ||||
Administrative servicing fees Class IV Shares | 33,828 | ||||
Custodian fees | 29,403 | ||||
Trustee fees | 15,835 | ||||
Compliance program costs (Note 3) | 4,737 | ||||
Other | 68,567 | ||||
Total expenses before earnings credit | 3,768,116 | ||||
Earnings credit (Note 6) | (9,071 | ) | |||
Net Expenses | 3,759,045 | ||||
Net Investment Income | 4,207,509 | ||||
REALIZED/ UNREALIZED GAINS (LOSSES) FROM INVESTMENTS: | |||||
Net realized gains on investment transactions | 46,465,532 | ||||
Net realized gains on futures transactions | 316,428 | ||||
Net realized gains on investment transactions and futures | 46,781,960 | ||||
Net change in unrealized depreciation on investments and futures | (11,599,222 | ) | |||
Net realized/unrealized gains (losses) on investments and futures | 35,182,738 | ||||
CHANGE IN NET ASSETS RESULTING FROM OPERATIONS | $ | 39,390,247 | |||
17
Nationwide Multi-Manager NVIT | |||||||||
Small Cap Value Fund | |||||||||
Six Months Ended | Year Ended | ||||||||
June 30, 2007 | December 31, 2006 | ||||||||
(Unaudited) | |||||||||
FROM INVESTMENT ACTIVITIES: | |||||||||
Operations: | |||||||||
Net investment income | $ | 4,207,509 | $ | 3,272,586 | |||||
Net realized gains on investment transactions and futures | 46,781,960 | 58,228,530 | |||||||
Net change in unrealized appreciation/depreciation on investments and futures | (11,599,222 | ) | 51,964,832 | ||||||
Change in net assets resulting from operations | 39,390,247 | 113,465,948 | |||||||
Distributions to shareholders from: | |||||||||
Net investment income: | |||||||||
Class I | (1,571,523 | ) | (2,667,879 | ) | |||||
Class II | (105,548 | ) | (111,406 | ) | |||||
Class III | (3,960 | ) | (6,969 | ) | |||||
Class IV | (156,777 | ) | (239,140 | ) | |||||
Net realized gains: | |||||||||
Class I | (9,476,755 | ) | (45,122,447 | ) | |||||
Class II | (838,835 | ) | (4,149,180 | ) | |||||
Class III | (22,799 | ) | (114,595 | ) | |||||
Class IV | (897,932 | ) | (3,996,332 | ) | |||||
Change in net assets from shareholder distributions | (13,074,129 | ) | (56,407,948 | ) | |||||
Change in net assets from capital transactions | (70,382,011 | ) | (93,293,728 | ) | |||||
Change in net assets | (44,065,893 | ) | (36,235,728 | ) | |||||
Net Assets: | |||||||||
Beginning of period | 696,140,328 | 732,376,056 | |||||||
End of period | $ | 652,074,435 | $ | 696,140,328 | |||||
Accumulated net investment income at end of period | $ | 3,030,520 | $ | 660,819 | |||||
CAPITAL TRANSACTIONS: | |||||||||
Class I Shares | |||||||||
Proceeds from shares issued | $ | 8,475,391 | $ | 52,704,544 | |||||
Dividends reinvested | 11,048,191 | 47,790,278 | |||||||
Cost of shares redeemed (a) | (78,778,740 | ) | (197,256,487 | ) | |||||
(59,255,158 | ) | (96,761,665 | ) | ||||||
Class II Shares | |||||||||
Proceeds from shares issued | 2,305,668 | 15,325,328 | |||||||
Dividends reinvested | 944,375 | 4,260,582 | |||||||
Cost of shares redeemed (a) | (12,009,179 | ) | (11,416,671 | ) | |||||
(8,759,136 | ) | 8,169,239 | |||||||
Class III Shares | |||||||||
Proceeds from shares issued | 31,912 | 399,483 | |||||||
Dividends reinvested | 26,758 | 121,563 | |||||||
Cost of shares redeemed (a) | (266,830 | ) | (590,028 | ) | |||||
(208,160 | ) | (68,982 | ) | ||||||
18
Nationwide Multi-Manager NVIT | |||||||||
Small Cap Value Fund | |||||||||
Six Months Ended | Year Ended | ||||||||
June 30, 2007 | December 31, 2006 | ||||||||
(Unaudited) | |||||||||
CAPITAL TRANSACTIONS: (continued) | |||||||||
Class IV Shares | |||||||||
Proceeds from shares issued | $ | 983,244 | $ | 2,255,881 | |||||
Dividends reinvested | 1,054,705 | 4,235,468 | |||||||
Cost of shares redeemed (a) | (4,197,506 | ) | (11,123,669 | ) | |||||
(2,159,557 | ) | (4,632,320 | ) | ||||||
Change in net assets from capital transactions | $ | (70,382,011 | ) | $ | (93,293,728 | ) | |||
SHARE TRANSACTIONS: | |||||||||
Class I Shares | |||||||||
Issued | 664,107 | 4,191,846 | |||||||
Reinvested | 859,113 | 3,844,135 | |||||||
Redeemed | (6,154,566 | ) | (15,892,924 | ) | |||||
(4,631,346 | ) | (7,856,943 | ) | ||||||
Class II Shares | |||||||||
Issued | 183,401 | 1,206,090 | |||||||
Reinvested | 74,185 | 345,360 | |||||||
Redeemed | (960,920 | ) | (931,854 | ) | |||||
(703,334 | ) | 619,596 | |||||||
Class III Shares | |||||||||
Issued | 2,495 | 31,386 | |||||||
Reinvested | 2,078 | 9,768 | |||||||
Redeemed | (20,929 | ) | (47,229 | ) | |||||
(16,356 | ) | (6,075 | ) | ||||||
Class IV Shares | |||||||||
Issued | 77,103 | 180,181 | |||||||
Reinvested | 82,014 | 340,591 | |||||||
Redeemed | (326,749 | ) | (890,772 | ) | |||||
(167,632 | ) | (370,000 | ) | ||||||
Total change in shares | (5,518,668 | ) | (7,613,422 | ) | |||||
(a) | Includes redemption fees, if any. |
19
Distributions | ||||||||||||||||||||
Investment Activities | ||||||||||||||||||||
Net Realized | ||||||||||||||||||||
and | ||||||||||||||||||||
Net Asset | Net | Unrealized | Total | |||||||||||||||||
Value, | Investment | Gains | from | Net | ||||||||||||||||
Beginning | Income | (Losses) on | Investment | Investment | ||||||||||||||||
of Period | (Loss) | Investments | Activities | Income | ||||||||||||||||
Class I Shares | ||||||||||||||||||||
For the year ended December 31, 2002 | $ | 10.36 | – | (j) | (2.78 | ) | (2.78 | ) | – | |||||||||||
For the year ended December 31, 2003 | $ | 7.37 | (0.02 | ) | 4.21 | 4.19 | – | |||||||||||||
For the year ended December 31, 2004 | $ | 11.56 | (0.01 | ) | 2.01 | 2.00 | –(j | ) | ||||||||||||
For the year ended December 31, 2005 | $ | 12.62 | 0.03 | 0.35 | 0.38 | (0.01 | ) | |||||||||||||
For the year ended December 31, 2006 | $ | 11.53 | 0.07 | 1.91 | 1.98 | (0.06 | ) | |||||||||||||
For the six months ended June 30, 2007 (Unaudited) | $ | 12.45 | 0.09 | 0.67 | 0.76 | (0.04 | ) | |||||||||||||
Class II Shares | ||||||||||||||||||||
Period ended December 31, 2002 (e) | $ | 10.26 | – | (j) | (2.68 | ) | (2.68 | ) | – | |||||||||||
For the year ended December 31, 2003 (h) | $ | 7.37 | (0.04 | ) | 4.20 | 4.16 | – | |||||||||||||
For the year ended December 31, 2004 | $ | 11.53 | (0.03 | ) | 1.99 | 1.96 | – | |||||||||||||
For the year ended December 31, 2005 | $ | 12.55 | (0.02 | ) | 0.36 | 0.34 | –(j | ) | ||||||||||||
For the year ended December 31, 2006 | $ | 11.43 | 0.03 | 1.91 | 1.94 | (0.03 | ) | |||||||||||||
For the six months ended June 30, 2007 (Unaudited) | $ | 12.34 | 0.07 | 0.66 | 0.73 | (0.03 | ) |
[Additional columns below]
[Continued from above table, first column(s) repeated]
Distributions | ||||||||||||||||||||||||
Net | Net Assets | Ratio of | ||||||||||||||||||||||
Realized | Net Asset | at End of | Expenses | |||||||||||||||||||||
Gains | Total | Value, End | Total | Period | to Average | |||||||||||||||||||
(Losses) | Distributions | of Period | Return (a) | (000s) | Net Assets (b) | |||||||||||||||||||
Class I Shares | ||||||||||||||||||||||||
For the year ended December 31, 2002 | (0.21 | ) | (0.21 | ) | $ | 7.37 | (27.16% | ) | $ | 467,165 | 1.11% | |||||||||||||
For the year ended December 31, 2003 | – | – | $ | 11.56 | 56.85% | $ | 715,099 | 1.11% | ||||||||||||||||
For the year ended December 31, 2004 | (0.94 | ) | (0.94 | ) | $ | 12.62 | 17.30% | $ | 754,412 | 1.11% | ||||||||||||||
For the year ended December 31, 2005 | (1.46 | ) | (1.47 | ) | $ | 11.53 | 3.07% | $ | 634,107 | 1.12% | ||||||||||||||
For the year ended December 31, 2006 | (1.00 | ) | (1.06 | ) | $ | 12.45 | 17.29% | $ | 587,084 | 1.13% | ||||||||||||||
For the six months ended June 30, 2007 (Unaudited) | (0.23 | ) | (0.27 | ) | $ | 12.94 | 6.07% | $ | 550,179 | 1.11% | ||||||||||||||
Class II Shares | ||||||||||||||||||||||||
Period ended December 31, 2002 (e) | (0.21 | ) | (0.21 | ) | $ | 7.37 | (26.46% | ) | $ | 1,472 | 1.32% | |||||||||||||
For the year ended December 31, 2003 (h) | – | – | $ | 11.53 | 56.45% | $ | 18,446 | 1.36% | ||||||||||||||||
For the year ended December 31, 2004 | (0.94 | ) | (0.94 | ) | $ | 12.55 | 17.00% | $ | 41,804 | 1.36% | ||||||||||||||
For the year ended December 31, 2005 | (1.46 | ) | (1.46 | ) | $ | 11.43 | 2.78% | $ | 44,096 | 1.38% | ||||||||||||||
For the year ended December 31, 2006 | (1.00 | ) | (1.03 | ) | $ | 12.34 | 17.10% | $ | 55,229 | 1.38% | ||||||||||||||
For the six months ended June 30, 2007 (Unaudited) | (0.23 | ) | (0.26 | ) | $ | 12.81 | 5.89% | $ | 48,342 | 1.36% |
[Additional columns below]
[Continued from above table, first column(s) repeated]
Ratios/Supplemental Data | ||||||||||||||||||
Ratio of Net | ||||||||||||||||||
Ratio of | Ratio of | Investment | ||||||||||||||||
Net | Expenses | Income | ||||||||||||||||
Investment | (Prior to | (Prior to | ||||||||||||||||
Income (Loss) | Reimbursements) | Reimbursements) | ||||||||||||||||
to Average | to Average | to Average | Portfolio | |||||||||||||||
Net Assets (b) | Net Assets (b)(c) | Net Assets (b)(c) | Turnover (d) | |||||||||||||||
Class I Shares | ||||||||||||||||||
For the year ended December 31, 2002 | 0.01% | 1.11% | 0.01% | 127.77% | ||||||||||||||
For the year ended December 31, 2003 | (0.18% | ) | (i) | (i) | 126.29% | |||||||||||||
For the year ended December 31, 2004 | (0.09% | ) | (i) | (i) | 132.11% | |||||||||||||
For the year ended December 31, 2005 | 0.09% | (i) | (i) | 188.69% | ||||||||||||||
For the year ended December 31, 2006 | 0.47% | (i) | (i) | 115.12% | ||||||||||||||
For the six months ended June 30, 2007 (Unaudited) | 1.28% | 1.11% | 1.28% | 54.76% | ||||||||||||||
Class II Shares | ||||||||||||||||||
Period ended December 31, 2002 (e) | 0.13% | (i) | (i) | 127.77% | ||||||||||||||
For the year ended December 31, 2003 (h) | (0.41% | ) | (i) | (i) | 126.29% | |||||||||||||
For the year ended December 31, 2004 | (0.30% | ) | (i) | (i) | 132.11% | |||||||||||||
For the year ended December 31, 2005 | (0.15% | ) | (i) | (i) | 188.69% | |||||||||||||
For the year ended December 31, 2006 | 0.23% | (i) | (i) | 115.12% | ||||||||||||||
For the six months ended June 30, 2007 (Unaudited) | 0.98% | 1.36% | 0.98% | 54.76% |
[Additional columns below]
[Continued from above table, first column(s) repeated]
(a) | Not annualized for periods less than one year. |
(b) | Annualized for periods less than one year. |
(c) | During the period, certain fees were waived and/or reimbursed. If such waivers/reimbursements had not occurred, the ratios would have been as indicated. |
(d) | Portfolio turnover is calculated on the basis of the Fund as a whole without distinguishing among the classes of shares. |
(e) | For the period from May 6, 2002 (commencement of operations) through December 31, 2002. |
(f) | For the period from May 3, 2002 (commencement of operations) through December 31, 2002. |
(g) | For the period from April 28, 2003 (commencement of operations) through December 31, 2003. |
(h) | Net investment income (loss) is based on average shares outstanding during the period. |
(i) | There were no fee waivers/reimbursements during the period. |
(j) | The amount is less than $0.005. |
Distributions | ||||||||||||||||||||
Investment Activities | ||||||||||||||||||||
Net Realized | ||||||||||||||||||||
and | ||||||||||||||||||||
Net Asset | Net | Unrealized | Total | |||||||||||||||||
Value, | Investment | Gains | from | Net | ||||||||||||||||
Beginning | Income | (Losses) on | Investment | Investment | ||||||||||||||||
of Period | (Loss) | Investments | Activities | Income | ||||||||||||||||
Class III Shares | ||||||||||||||||||||
Period ended December 31, 2002 (f) | $ | 10.48 | – | (j) | (2.89 | ) | (2.89 | ) | – | |||||||||||
For the year ended December 31, 2003 (h) | $ | 7.38 | (0.01 | ) | 4.20 | 4.19 | – | |||||||||||||
For the year ended December 31, 2004 | $ | 11.57 | (0.01 | ) | 2.02 | 2.01 | – | (j) | ||||||||||||
For the year ended December 31, 2005 | $ | 12.64 | 0.03 | 0.35 | 0.38 | (0.01 | ) | |||||||||||||
For the year ended December 31, 2006 | $ | 11.55 | 0.07 | 1.92 | 1.99 | (0.06 | ) | |||||||||||||
For the six months ended June 30, 2007 (Unaudited) | $ | 12.48 | 0.09 | 0.66 | 0.75 | (0.04 | ) | |||||||||||||
Class IV Shares | ||||||||||||||||||||
Period ended December 31, 2003 (g) | $ | 7.49 | (0.01 | ) | 4.08 | 4.07 | – | |||||||||||||
For the year ended December 31, 2004 | $ | 11.56 | (0.01 | ) | 2.01 | 2.00 | – | (j) | ||||||||||||
For the year ended December 31, 2005 | $ | 12.62 | 0.03 | 0.35 | 0.38 | (0.01 | ) | |||||||||||||
For the year ended December 31, 2006 | $ | 11.53 | 0.07 | 1.91 | 1.98 | (0.06 | ) | |||||||||||||
For the six months ended June 30, 2007 (Unaudited) | $ | 12.45 | 0.09 | 0.67 | 0.76 | (0.04 | ) | |||||||||||||
[Additional columns below]
[Continued from above table, first column(s) repeated]
Distributions | ||||||||||||||||||||||||
Net | Net Assets | Ratio of | ||||||||||||||||||||||
Realized | Net Asset | at End of | Expenses | |||||||||||||||||||||
Gains | Total | Value, End | Total | Period | to Average | |||||||||||||||||||
(Losses) | Distributions | of Period | Return (a) | (000s) | Net Assets (b) | |||||||||||||||||||
Class III Shares | ||||||||||||||||||||||||
Period ended December 31, 2002 (f) | (0.21 | ) | (0.21 | ) | $ | 7.38 | (27.88% | ) | $ | 63 | 1.07% | |||||||||||||
For the year ended December 31, 2003 (h) | – | – | $ | 11.57 | 56.78% | $ | 2,568 | 1.11% | ||||||||||||||||
For the year ended December 31, 2004 | (0.94 | ) | (0.94 | ) | $ | 12.64 | 17.37% | $ | 2,029 | 1.11% | ||||||||||||||
For the year ended December 31, 2005 | (1.46 | ) | (1.47 | ) | $ | 11.55 | 3.06% | $ | 1,445 | 1.13% | ||||||||||||||
For the year ended December 31, 2006 | (1.00 | ) | (1.06 | ) | $ | 12.48 | 17.37% | $ | 1,485 | 1.12% | ||||||||||||||
For the six months ended June 30, 2007 (Unaudited) | (0.23 | ) | (0.27 | ) | $ | 12.96 | 5.99% | $ | 1,331 | 1.10% | ||||||||||||||
Class IV Shares | ||||||||||||||||||||||||
Period ended December 31, 2003 (g) | – | – | $ | 11.56 | 54.34% | $ | 53,826 | 1.10% | ||||||||||||||||
For the year ended December 31, 2004 | (0.94 | ) | (0.94 | ) | $ | 12.62 | 17.30% | $ | 58,521 | 1.11% | ||||||||||||||
For the year ended December 31, 2005 | (1.46 | ) | (1.47 | ) | $ | 11.53 | 3.07% | $ | 52,727 | 1.12% | ||||||||||||||
For the year ended December 31, 2006 | (1.00 | ) | (1.06 | ) | $ | 12.45 | 17.40% | $ | 52,343 | 1.12% | ||||||||||||||
For the six months ended June 30, 2007 (Unaudited) | (0.23 | ) | (0.27 | ) | $ | 12.94 | 6.00% | $ | 52,222 | 1.09% | ||||||||||||||
[Additional columns below]
[Continued from above table, first column(s) repeated]
Ratios/Supplemental Data | ||||||||||||||||||
Ratio of Net | ||||||||||||||||||
Ratio of | Ratio of | Investment | ||||||||||||||||
Net | Expenses | Income | ||||||||||||||||
Investment | (Prior to | (Prior to | ||||||||||||||||
Income (Loss) | Reimbursements) | Reimbursements) | ||||||||||||||||
to Average | to Average | to Average | Portfolio | |||||||||||||||
Net Assets (b) | Net Assets (b)(c) | Net Assets (b)(c) | Turnover (d) | |||||||||||||||
Class III Shares | ||||||||||||||||||
Period ended December 31, 2002 (f) | 0.60% | (i) | (i) | 127.77% | ||||||||||||||
For the year ended December 31, 2003 (h) | (0.13% | ) | (i) | (i) | 126.29% | |||||||||||||
For the year ended December 31, 2004 | (0.09% | ) | (i) | (i) | 132.11% | |||||||||||||
For the year ended December 31, 2005 | 0.08% | (i) | (i) | 188.69% | ||||||||||||||
For the year ended December 31, 2006 | 0.47% | (i) | (i) | 115.12% | ||||||||||||||
For the six months ended June 30, 2007 (Unaudited) | 1.28% | 1.10% | 1.28% | 54.76% | ||||||||||||||
Class IV Shares | ||||||||||||||||||
Period ended December 31, 2003 (g) | (0.18% | ) | (i) | (i) | 126.29% | |||||||||||||
For the year ended December 31, 2004 | (0.08% | ) | (i) | (i) | 132.11% | |||||||||||||
For the year ended December 31, 2005 | 0.10% | (i) | (i) | 188.69% | ||||||||||||||
For the year ended December 31, 2006 | 0.48% | (i) | (i) | 115.12% | ||||||||||||||
For the six months ended June 30, 2007 (Unaudited) | 1.31% | 1.10% | 1.31% | 54.76% | ||||||||||||||
(a) | Not annualized for periods less than one year. | |
(b) | Annualized for periods less than one year. | |
(c) | During the period, certain fees were waived and/or reimbursed. If such waivers/reimbursements had not occurred, the ratios would have been as indicated. | |
(d) | Portfolio turnover is calculated on the basis of the Fund as a whole without distinguishing among the classes of shares. | |
(e) | For the period from May 6, 2002 (commencement of operations) through December 31, 2002. | |
(f) | For the period from May 3, 2002 (commencement of operations) through December 31, 2002. | |
(g) | For the period from April 28, 2003 (commencement of operations) through December 31, 2003. | |
(h) | Net investment income (loss) is based on average shares outstanding during the period. | |
(i) | There were no fee waivers/reimbursements during the period. | |
(j) | The amount is less than $0.005. |
1. Organization
Nationwide Variable Insurance Trust (“NVIT” or the “Trust”) is an open-end management investment company, organized under the laws of Delaware by an amended and restated Agreement and Declaration of Trust, dated October 28, 2004, as amended to date. Prior to May 1, 2007, the Trust was named “Gartmore Variable Insurance Trust”. The Trust, originally created under the laws of Massachusetts as a Massachusetts business trust pursuant to a Declaration of Trust dated, as of June 30, 1981, and as subsequently amended, redomesticated as a Delaware Statutory Trust after the close of trading on April 29, 2005, and is registered under the Investment Company Act of 1940, as amended (the “1940 Act”). The redomestication was a change in statutory status and did not affect the operations of the Trust. As of June 30, 2007, the Trust had authorized an unlimited number of shares of beneficial interest, without par value (“shares”). The Trust currently offers shares to life insurance company separate accounts to fund the benefits under variable life insurance or annuity policies. To date, only the separate accounts of Nationwide Life Insurance Company and Nationwide Life and Annuity Insurance Company (collectively, “Nationwide”) have purchased shares of the Nationwide Multi-Manager NVIT Small Cap Value Fund (the “Fund”), (formerly, “GVIT Small Cap Value Fund”). The Trust currently operates forty (40) separate series, or mutual funds, each with its own investment objectives and strategies. This report contains the financial statements and financial highlights of the Fund.
2. Summary of Significant Accounting Policies
The following is a summary of significant accounting policies followed by the Fund in the preparation of its financial statements. The policies are in conformity with accounting principles generally accepted in the United States of America (“GAAP”). The preparation of financial statements requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of income and expenses for the period. Actual results could differ from those estimates.
(a) | Security Valuation |
Securities for which market quotations are readily available are valued at current market value as of “Valuation Time.” Valuation Time is as of the close of regular trading on the New York Stock Exchange (usually 4 p.m. Eastern time). Equity securities are valued at the last quoted sale price or, if there is no sale price, the last quoted bid price provided by an independent pricing service approved by the Trust’s Board of Trustees (“Board of Trustees”). Securities traded on NASDAQ are valued at the NASDAQ official closing price. Prices are taken from the primary market or exchange in which each security trades. Investment companies are valued at net asset value as reported by such company. | |
Most securities listed on a foreign exchange are valued either at fair value (see description below) or at the last sale price at the close of the exchange on which the security is principally traded. Foreign securities, currencies, and other assets and liabilities denominated in foreign currencies are translated into U.S. dollars at the exchange rate of said currencies against the U.S. dollar, as of Valuation Time, as provided by an independent pricing service approved by the Board of Trustees. | |
Securities for which market quotations are not readily available, or for which an independent pricing service does not provide a value or provides a value that does not represent fair value in the judgment of the Fund’s investment adviser or designee, are valued at fair value under procedures approved by the Board of Trustees. The “Fair Value” of these securities is determined in good faith by taking into account relevant factors and surrounding circumstances. Methods utilized to obtain a “Fair Value” may include the following non-exclusive list of acceptable methods: (i) a multiple of earnings; (ii) the discount from market value of a similar, freely traded security; (iii) the yield-to-maturity for debt issues; or (iv) a consolidation of the methods. The Trust’s Valuation & Operations Committee considers a non-exclusive list of factors to arrive at the appropriate method of determining “Fair Value.” For example, fair value determinations are required for securities whose value is affected by a “significant” event that materially affects the value of a domestic or foreign security which occurs subsequent to the time of the close of the principal market on which such domestic or foreign security trades and before the Valuation Time (i.e., a “subsequent event”). Typically, |
this will involve events occurring after the close of a foreign market on which a security trades and before the next Valuation Time. | |
The Fund values foreign securities at fair value in the circumstances described below. Generally, trading in foreign securities markets is completed each day at various times prior to the Valuation Time. Due to the time differences between the closings of the relevant foreign securities exchanges and the Valuation Time for the Fund, the Fund will fair value its foreign investments when it is determined that the market quotations for the foreign investments either are not readily available or are unreliable and, therefore, do not represent fair value. When the fair value prices are utilized, these prices will attempt to reflect the impact of the U.S. financial markets’ perceptions and trading activities on the Fund’s foreign investments since the last closing prices of the foreign investments were calculated on their primary foreign securities markets or exchanges. For these purposes, the Board of Trustees has determined that movements in relevant indices or other appropriate market indicators, after the close of the foreign securities exchanges, may demonstrate that market quotations are unreliable, and may trigger fair value pricing for certain securities. Consequently, fair valuation of portfolio securities may occur on a daily basis. |
(b) | Repurchase Agreements |
The Fund may enter into repurchase agreements with an entity which is a member of the Federal Reserve System or which is a “primary dealer” (as designated by the Federal Reserve Bank of New York) in U.S. Government obligations. The repurchase price generally equals the price paid by the Fund plus interest negotiated on the basis of current short-term rates, which may be more or less than the rate on the underlying portfolio securities. The seller under a repurchase agreement is required to maintain the value of the collateral held pursuant to the agreement at a market value equal to or greater than the repurchase price (including accrued interest). Collateral subject to repurchase agreements is held by the Fund’s custodian or another qualified sub-custodian or in the Federal Reserve/ Treasury book-entry system. If the counterparty defaults and the fair value of the collateral declines, realization of the collateral by the Fund may be delayed or limited. The Fund may transfer uninvested cash balances into a pooled cash account. These balances are invested in one or more repurchase agreements, with the counterparty of Nomura Securities, which is fully collateralized by U.S. Government Agency Mortgages. |
(c) | Futures Contracts |
The Fund may invest in financial futures contracts (“futures contracts”) for the purpose of hedging its existing portfolio securities or securities that the Fund intends to purchase against fluctuations in value caused by changes in prevailing market interest rates or prices. Futures contracts may also be entered into for non-hedging purposes. | |
Upon entering into a futures contract, the Fund is required to pledge to the broker an amount of cash and/or other assets equal to a certain percentage of the contract amount (initial margin deposit). Subsequent payments, known as “variation margin,” are made each day, depending on the daily fluctuations in the fair value/market value of the underlying assets. A gain or loss equal to the daily variation margin is recognized on a daily basis. Futures contracts are valued daily at their last quoted sale price. | |
A “sale” of a futures contract means the creation of a contractual obligation to deliver the securities or foreign currency called for by the contract at a fixed price at a specified time in the future. A “purchase” of a futures contract means the creation of a contractual obligation to acquire the securities or foreign currency at a fixed price at a specified time in the future. | |
Should market conditions change unexpectedly, the Fund may not achieve the anticipated benefits of the futures contracts and may realize a loss. The use of futures transactions for hedging purposes involves the risk of imperfect correlation in movements in the price of futures contracts, interest rates, and the value of the underlying hedged assets. |
(d) | Security Transactions and Investment Income |
Security transactions are accounted for on the date the security is purchased or sold (“trade date”). Securities gains and losses are calculated on the identified cost basis. Interest income is recognized on the accrual basis and includes, where applicable, the amortization or accretion of premium or discount. Dividend income is recorded on the ex-dividend date. |
(e) | Securities Lending |
To generate additional income, the Fund may lend its portfolio securities, up to 33 1/3% of the Fund, to brokers, dealers and other financial institutions provided that (1) the borrower delivers cash or securities as collateral with respect to each new loan of U.S. securities, equal to at least 102% of the value of the portfolio securities loaned, and with respect to each new loan on non-U.S. securities, collateral of at least 105% of the value of the portfolio securities loaned; and (2) at all times thereafter shall require the borrower to mark-to-market the collateral on a daily basis so that the market value of such collateral does not fall below 100% of the value of securities loaned. The Fund receives payments from borrowers equivalent to the dividends and interest that would have been earned on securities loaned while simultaneously seeking to earn income on the investment of cash collateral. There may be risks of delay in recovery of the securities should the borrower of the securities fail financially. Loans will be made, however, only to borrowers deemed by the Fund’s investment adviser to be of good standing and creditworthy under guidelines established by the Board of Trustees and when, in judgment of the adviser, the consideration which can be earned currently from these securities loans justifies the attendant risks. Loans are subject to termination by the Fund or the borrower at any time, and, therefore, are not considered to be illiquid investments. JPMorgan Chase Bank serves as custodian for the securities lending program of the Fund. JPMorgan Chase Bank receives a fee based on the value of the collateral received from borrowers. The Fund did not have securities on loan as of June 30, 2007. |
(f) | Distributions to Shareholders |
The Fund’s dividends from net investment income, if any, are declared and paid quarterly. The Fund’s distributions from net realized capital gains, if any, are declared and distributed at least annually. | |
Dividends and distributions to shareholders are determined in accordance with federal income tax regulations, which may differ from GAAP. These “book/tax” differences are considered either permanent or temporary in nature. In accordance with the American Institute of Certified Public Accountants Statement of Position 93-2, permanent differences (i.e., reclassification of market discounts, foreign exchange gain/loss, paydowns, and distributions from real estate investment trusts) are reclassified within the capital accounts based on their nature for federal income tax purposes; temporary differences do not require reclassification. These reclassifications have no effect upon the net asset value of the Fund. To the extent distributions exceed current and accumulated earnings and profits for federal income tax purposes, these distributions are reported as distributions of paid-in-capital. |
(g) | Federal Income Taxes |
It is the policy of the Fund to qualify or to continue to qualify as a “regulated investment company” by complying with the provisions available to certain investment companies, as defined in Subchapter M of the U.S. Internal Revenue Code, and to make distributions of net investment income and net realized capital gains sufficient to relieve the Fund from all, or substantially all, federal income taxes. | |
As of June 30, 2007, the tax cost of securities and the breakdown of unrealized appreciation (depreciation) for the Fund was as follows: |
Net | ||||||||||||||||
Unrealized | ||||||||||||||||
Tax Cost of | Unrealized | Unrealized | Appreciation | |||||||||||||
Securities | Appreciation | Depreciation | (Depreciation) | |||||||||||||
$ | 574,680,692 | $ | 100,466,433 | $ | (27,471,494 | ) | $ | 72,994,939 | ||||||||
(h) | Allocation of Expenses, Income, and Gains and Losses |
Expenses directly attributable to the Fund are charged to the Fund. Expenses not directly attributable to the Fund are allocated proportionately among various or all funds within the Trust. The method used by the Fund for allocating income, fund level expenses, and realized and unrealized gains or losses is based on the fair value of shares outstanding relative to net assets. Under this method, each class of shares participates based on the total net asset value of that class’s shares in proportion to the total net assets of the Fund. Expenses specific to a class (such as Rule 12b-1 and administrative services fees) are charged to that class. |
3. Transactions with Affiliates
Under the terms of the Trust’s Investment Advisory Agreement, Nationwide Fund Advisors (formerly, Gartmore Mutual Fund Capital Trust (“GMF”)) (“NFA” or the “Advisor”) manages the investment of the assets and supervises the daily business affairs of the Fund. NFA is a wholly-owned subsidiary of Nationwide Financial Services (“NFS”). In addition, NFA provides investment management evaluation services in initially selecting and monitoring, on an ongoing basis, the performance of the subadvisers for the Fund. The subadvisers listed below manage all or a portion of the Fund’s investments and have the responsibility for making all investment decisions for that portion of the Fund unless otherwise indicated. Below is a list of the subadvisers to the Fund:
Subadvisers* | ||||||
– J.P. Morgan Investment Management, Inc. | ||||||
– Epoch Investment Partners, Inc. | ||||||
Under the terms of the Investment Advisory Agreement, the Fund pays NFA an investment advisory fee based on that Fund’s average daily net assets. Additional information regarding investment advisory fees and subadvisory fees for NFA and the subadvisers is as follows for the six months ended June 30, 2007:
Total | ||||||
Fee Schedule | Fees | |||||
Up to $200 million | 0.90% | |||||
$200 million or more | 0.85% | |||||
From such fees, pursuant to the subadvisory agreements, NFA paid the subadvisers $1,553,921 for the six months ended June 30, 2007.
Under the terms of a Fund Administration and Transfer Agency Agreement, Nationwide Fund Management, LLC (formerly, Gartmore Investor Services, Inc. (“GISI”)) (“NFM”), a wholly-owned subsidiary of NFS Distributors, Inc. (“NFSDI”), provides the Fund with various administrative and accounting services for the Fund (prior to May 1, 2007,this service was provided by Gartmore SA Capital Trust (“GSA”)), and serves as Transfer and Dividend Disbursing Agent for the Fund (prior to May 1, 2007, this service was provided by GISI, an indirect subsidiary of GSA). The fees for the services provided under this Agreement are calculated based on the Trust’s average daily net assets according to the fee
Combined Fee Schedule* | ||||||
Up to $1 billion | 0.15% | |||||
$1 billion up to $3 billion | 0.10% | |||||
$3 billion up to $8 billion | 0.05% | |||||
$8 billion up to $10 billion | 0.04% | |||||
$10 billion up to $12 billion | 0.02% | |||||
$12 billion or more | 0.01% | |||||
* | The assets of the Nationwide NVIT Investor Destinations Aggressive Fund, the Nationwide NVIT Investor Destinations Moderately Aggressive Fund, the Nationwide NVIT Investor Destinations Moderate Fund, the Nationwide NVIT Investor Destinations Moderately Conservative Fund, and the Nationwide NVIT Investor Destinations Conservative Fund (collectively, the “Investor Destinations Funds”) are excluded from the Trust asset level amount in order to calculate this asset-based fee. The Investor Destinations Funds do not pay any part of this fee. |
NFA and NFM have entered into agreements with Citi Fund Services Ohio, Inc. (“Citi”), pursuant to which Citi provides sub-administration and sub-transfer agency services, respectively, to the Fund. Effective August 1, 2007, The BISYS Group Inc. was acquired by and became a wholly owned subsidiary of Citi.
Under the terms of a Distribution Plan under Rule 12b-1 of the 1940 Act, Nationwide Fund Distributors, LLC. (formerly, “Gartmore Distribution Services, Inc. (“GDSI”)) (“NFD” or “Distributor”), the Fund’s principal underwriter, is compensated by the Fund for expenses associated with the distribution of the Class II shares of the Fund. NFD is a wholly-owned subsidiary of NFSDI. These fees are based on average daily net assets of Class II shares of the Fund at an annual rate not to exceed 0.25%.
Under the terms of an Administrative Services Plan, the Fund may pay fees to servicing organizations, such as broker-dealers, including NFS, and financial institutions, which agree to provide administrative support services to the shareholders of certain classes. These services include, but are not limited, to the following: establishing and maintaining shareholder accounts; processing purchase and redemption transactions; arranging bank wires; performing shareholder sub-accounting; answering inquires regarding the Fund; and other such services. These fees are based on an annual rate of up to 0.25% of the average daily net assets of Class I, Class II, and Class III shares of the Fund and 0.20% of Class IV shares of the Fund.
For the six months ended June 30, 2007, NFS received $499,731 in Administrative Services Fees from the Fund.
Under the terms of a letter agreement dated September 12, 2006, by and among NFA, the Audit Committee of the Trust and the Trust, the Trust has agreed to reimburse NFA certain costs related to the Fund’s portion of ongoing administration, monitoring and annual (audit) testing of the Trust’s Rule 38a-1 Compliance Program subject to the pre-approval of the Trust’s Audit Committee. For the six months ended June 30, 2007, the Fund’s portion of such cost amounted to $4,737.
4. Short-Term Trading Fees
The Fund reserves the right to assess a short-term trading fee on certain transactions out of Class III shares that a separate account makes on behalf of a variable insurance contract owner (the “contract owner”). A separate account that redeems Class III shares on behalf of a contract owner may be subject to a 1.00% short-term trading fee if the separate account held the Class III shares on behalf of the contract owner for 60 days or less, unless an exception applies as disclosed in the Fund’s prospectus. The short-term trading fee is paid directly to the Fund and is intended to offset the cost to the Fund of excess brokerage commissions and other costs associated with fluctuations in Fund asset levels and cash flow caused by short-term trading. For purposes of determining whether the short-term trading fee applies, the Class III shares that were held on behalf of the contract owner the longest will be treated as being redeemed first.
For the six months ended June 30, 2007, the Fund had no contributions to capital due to collection of redemption fees.
5. Investment Transactions
For the six months ended June 30, 2007, (excluding short-term securities) the Fund had purchases of $358,588,906 and sales of $441,290,420.
For the six months ended June 30, 2007, the Fund had purchases of $258,563 of U.S. Government securities.
6. Bank Loans and Earnings Credit
The Trust has a credit agreement with JPMorgan Chase & Co., the Fund’s custodian bank, permitting the Trust to borrow up to $100,000,000. Borrowings under this arrangement bear interest at the Federal Funds rate plus 0.50%. The interest costs, if any, would be included in other fees in the Statement of Operations. No compensating balances were required under the terms of the line of credit. The line of credit is renewed annually, expiring on June 25, 2008, with a commitment fee of 0.07% per year on $100,000,000. There were no borrowings outstanding under this line of credit for the six months ended June 30, 2007.
The Trust’s custodian bank has agreed to reduce the bank’s fees (earnings credit) when the funds of the Trust maintain cash on deposit in non-interest-bearing custody and Demand Deposit Accounts. Earnings credits, if any, are shown as a reduction of total expenses on the Statement of Operations.
7. Portfolio Investment Risks
Risks Associated with Foreign Securities and Currencies. Investments in securities of foreign issuers carry certain risks not ordinarily associated with investments in securities of U.S. issuers. These risks include future political and economic developments, and the possible imposition of exchange controls or other foreign governmental laws and restrictions. In addition, with respect to certain countries, there is the possibility of expropriation of assets, confiscatory taxation, political or social instability, or diplomatic developments, which could adversely affect investments in those countries.
Certain countries also may impose substantial restrictions on investments in their capital markets by foreign entities, including restrictions on investments in issuers of industries deemed sensitive to relevant national interests. These factors may limit the investment opportunities available and result in a lack of liquidity and high price volatility with respect to securities of issuers from developing countries.
8. Indemnifications
Under the Trust’s organizational documents, certain of the Trust’s Officers and Trustees are indemnified against certain liabilities arising out of the performance of their duties to the Trust. In addition, the Trust has entered into Indemnification Agreements with the Trust’s trustees and certain officers covering similar liabilities. Trust Officers receive no compensation from the Trust for serving as the Trust’s Officers. In addition, in the normal course of business, the Trust enters into contracts with its vendors and others that provide for general indemnifications. The Trust’s maximum exposure under these arrangements is unknown, as this would involve future claims that may be made against the Trust. Based on experience, however, the Trust expects that risk of loss to be remote.
9. Recently Issued Accounting Pronouncements
On July 13, 2006, the Financial Accounting Standards Board (“FASB”) released FASB Interpretation No. 48, Accounting for Uncertainty in Income Taxes (“FIN 48”). FIN 48 provides guidance for how uncertain tax positions should be recognized, measured, presented and disclosed in the financial statements. FIN 48 requires the affirmative evaluation of tax positions taken or expected to be taken in the course of preparing the Fund’s tax returns to determine whether it is more-likely-than-not (i.e., greater than 50 percent) that each tax position will be sustained upon examination by a taxing authority based on the technical merits of the position. A tax position that meets the more-likely-than-not recognition threshold is measured to determine the amount of benefit to recognize in the financial statements. Differences between tax
In September 2006, the FASB issued Statement on Financial Accounting Standards (“SFAS”) No. 157, “Fair Value Measurements.” This standard establishes a single authoritative definition of fair value, sets out a framework for measuring fair value and requires additional disclosures about fair value measurements. SFAS No. 157 applies to fair value measurements already required or permitted by existing standards. SFAS No. 157 is effective for financial statements issued for fiscal years beginning after November 15, 2007 and interim periods within those fiscal years. The changes to current accounting principles generally accepted in the United States of America from the application of this Statement relate to the definition of fair value, the methods used to measure fair value, and the expanded disclosures about fair value measurements. As of June 30, 2007, the Fund does not believe the adoption of SFAS No. 157 will impact the financial statement amounts; however, additional disclosures may be required about the inputs used to develop the measurements and the effect of certain of the measurements on changes in net assets for the period.
Trustees who are not Interested Persons (as defined in the 1940 Act) and Officers of the Trust as of
Number of Portfolios | ||||||||||
Position(s) Held | in the | |||||||||
with the Trust | Principal Occupation(s) | Nationwide Fund | Other | |||||||
Name, Address | and Length of | During Past | Complex Overseen | Directorships | ||||||
and Year of Birth | Time Served1 | Five Years | by Trustee | Held by Trustee2 | ||||||
Charles E. Allen c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1948 | Trustee since July 2000 | Mr. Allen is Chairman, Chief Executive Officer and President of Graimark Realty Advisors, Inc. (real estate development, investment and asset management). | 89 | None | ||||||
Paula H.J. Cholmondeley c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1947 | Trustee since July 2000 | Ms. Cholmondeley was Vice President and General Manager of Sappi Fine Paper North America from April 2000 through December 2003. | 89 | Director of Dentsply International, Inc. (dental products), Ultralife Batteries, Inc., Terex Corporation (construction equipment), Minerals Technology, Inc. (specialty chemicals) and Albany International Corp. (paper industry) | ||||||
C. Brent DeVore3 c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1940 | Trustee since 1990 | Dr. DeVore is President of Otterbein College. | 89 | None | ||||||
Phyllis Kay Dryden c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1947 | Trustee since December 2004 | Ms. Dryden was a partner of Mitchell Madison, a management consulting company from January 2006 until December 2006; she is currently a consultant with the company. Ms. Dryden was formerly Managing Partner of march FIRST, a global management consulting firm. | 89 | None | ||||||
Barbara L. Hennigar c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1935 | Trustee since July 2000 | Retired. | 89 | None | ||||||
Number of Portfolios | ||||||||||
Position(s) Held | in the | |||||||||
with the Trust | Principal Occupation(s) | Nationwide Fund | Other | |||||||
Name, Address | and Length of | During Past | Complex Overseen | Directorships | ||||||
and Year of Birth | Time Served1 | Five Years | by Trustee | Held by Trustee2 | ||||||
Barbara I. Jacobs c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1950 | Trustee since December 2004 | Ms. Jacobs served as Chairman of the Board of Directors of KICAP Network Fund, a European (United Kingdom) hedge fund, from January 2001 through January 2006. From 1998-2003, Ms. Jacobs was also a Managing Director and European Portfolio Manager of CREF Investments (Teachers Insurance and Annuity Association-College Retirement Equities Fund). | 89 | None | ||||||
Douglas F. Kridler c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1955 | Trustee since September 1997 | Mr. Kridler has served as the President and Chief Executive Officer of the Columbus Foundation (a Columbus, OH-based foundation which manages over 1,300 individual endowment funds) since February 2002. Prior to January 31, 2002, Mr. Kridler was the President of the Columbus Association for the Performing Arts and Chairman of the Greater Columbus Convention and Visitors Bureau. | 89 | None | ||||||
Michael D. McCarthy c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1947 | Trustee since December 2004 | Retired. Mr. McCarthy was Chairman of VMAC (commodity swaps) from October 2002 until January 2007; and a partner of Pineville Properties LLC (a commercial real estate development firm) from September 2000 until January 2007. | 89 | None | ||||||
David C. Wetmore c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1948 | Trustee since 1995 and Chairman since February 2005 | Retired. | 89 | None | ||||||
1 | Length of time served includes time served with the Trust’s predecessors. | |
2 | Directorships held in (1) any other investment companies registered under the 1940 Act, (2) any company with a class of securities registered pursuant to Section 12 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or (3) any company subject to the requirements of Section 15(d) of the Exchange Act. | |
3 | Mr. DeVore has served as President of Otterbein College since 1984. Mark Thresher, President and Chief Operating Officer of Nationwide Financial Services, Inc. (“NFS”) has served as a member of the Board of Trustees of Otterbein College since 2000, currently serves as one of 30 of its trustees, and is currently one of two Vice Chairmen of the Board. Each of Nationwide Fund Advisors (“NFA”), the Funds’ investment adviser, and Nationwide Fund Distributors LLC (“NFD”), principal underwriter to the Trust, is a wholly-owned subsidiary of NFS. | |
Additional information regarding the Trustees and Officers may be found in the Trust’s Statement of Additional Information, which is available without charge upon request, by calling 800-848-0920. |
Trustees who are Interested Persons (as defined in the 1940 Act) and/or Officers of the Trust as of
Number of Portfolios | ||||||||||
Position(s) Held | in the | |||||||||
with the Trust | Principal Occupation(s) | Nationwide Fund | Other | |||||||
Name, Address | and Length of | During Past | Complex Overseen | Directorships | ||||||
and Year of Birth | Time Served1 | 5 Years | by Trustee | Held by Trustee 2 | ||||||
Arden L. Shisler c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1941 | Trustee since February 2000 | Retired. Mr. Shisler is the former President and Chief Executive Officer of KeB Transport, Inc., a trucking firm (2000 through 2002). He served as a consultant to KeB from January 2003 through December 2004. Since 1992, Mr. Shisler has also been Chairman of the Board for Nationwide Mutual Insurance Company.3 | 89 | Director of Nationwide Financial Services, Inc., Chairman of Nationwide Mutual Insurance Company3 | ||||||
John H. Grady Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1961 | President & Chief Executive Officer since December 2006 | Mr. Grady is President, and Chief Executive Officer of Nationwide Funds Group which includes Nationwide Fund Advisors,3 Nationwide Fund Management LLC,3 Nationwide Fund Distributors LLC 3 and NWD Investments,2 the asset management operations of Nationwide Mutual Insurance Company, which includes Morley Capital Management, Inc.,2 Nationwide Separate Accounts LLC,2 NorthPointe Capital LLC,2 and Nationwide SA Capital Trust2. From March 2004 until March 2006, Mr. Grady was Chief Executive Officer of Constellation Investment Management Co., L.P. (registered investment adviser), and President and Chief Executive Officer of Constellation Funds Group (registered investment companies). He also was President of Constellation Investment Distribution Co., Inc. (registered broker-dealer) from March 2004 until June 2006. From February 2001 until February 2004, Mr. Grady was Chief Operating and Chief Legal Officer; Managing Director, Mutual Funds Group, Turner Investment Partners, Inc. (registered investment adviser); Executive Vice President of Turner Funds and Turner Institutional Portfolios (registered investment companies); and President, Turner Investment Distributors, Inc. (registered broker-dealer). | N/A | None | ||||||
Gerald J. Holland Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1951 | Treasurer since March 2001 | Mr. Holland is Senior Vice President—Operations for Nationwide Funds Group3. | N/A | N/A | ||||||
Number of Portfolios | ||||||||||
Position(s) Held | in the | |||||||||
with the Trust | Principal Occupation(s) | Nationwide Fund | Other | |||||||
Name, Address | and Length of | During Past | Complex Overseen | Directorships | ||||||
and Year of Birth | Time Served1 | 5 Years | by Trustee | Held by Trustee 2 | ||||||
Michael A. Krulikowski Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1959 | Chief Compliance Officer from June 2004 to August 20074 | Mr. Krulikowski is Vice President and Chief Compliance Officer of Nationwide Funds Group3, Morley Capital Management, Inc.3, Nationwide SA Capital Trust (since 1999)3, and Nationwide Separate Accounts LLC (since August 2005).3 Since June 2004, Mr. Krulikowski has also served as Chief Compliance Officer of the Trust. From November 1999 through May 2007, he served as Vice President and Chief Compliance Officer of NorthPointe Capital LLC. 3 | N/A | N/A | ||||||
Eric E. Miller Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1953 | Secretary since December 2002 | Mr. Miller is Senior Vice President, General Counsel, and Assistant Secretary for Nationwide Funds Group3 and NWD Investments.2 From August 2000 to August 2002, Mr. Miller was a Partner with Stradley Ronon Stevens & Young, LLP. | N/A | N/A | ||||||
1 | Length of time served includes time served with the Trust’s predecessors. | |
2 | Directorships held in (1) any other investment companies registered under the 1940 Act, (2) any company with a class of securities registered pursuant to Section 12 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or (3) any company subject to the requirements of Section 15(d) of the Exchange Act. | |
3 | This position is held with an affiliated person or principal underwriter of the Trust. | |
4 | Effective August 3, 2007, the Board of Trustees approved Carol Baldwin Moody as Chief Compliance Officer of the Trust. Since November 2005, Ms. Moody has been Senior Vice President, Chief Compliance Officer of Nationwide Financial Services, Nationwide Life Insurance Company, Nationwide Life and Annuity Insurance Company, and Nationwide Investment Advisors, LLC. From February 2004-November 2005, she was Chief Compliance Officer of TIAA-CREF and from April 2000-February 2004, she was Managing Director and General Counsel, TCW/ Latin America Partners, LLC and Baeza & Co., LLC. | |
Federal law requires the Trust, each of its investment advisers and sub-advisers to adopt procedures for voting proxies (“Proxy Voting Guidelines”) and to provide a summary of those Proxy Voting Guidelines used to vote the securities held by the Funds. The Funds’ proxy voting policies and procedures are available without charge (i) upon request, by calling 800-848-0920, (ii) on the Funds’ website at www.nationwidefunds.com, or (iii) on the Securities and Exchange Commission’s website at www.sec.gov. |
A. Renewal of Investment Advisory Agreement
(i) | General Information Regarding the Board’s Review of Investment Advisory Agreements |
The Trust’s investment advisory agreements (each an “Advisory Agreement”) with its investment adviser and, as applicable, sub-advisers (together, the “Adviser”) must be approved for an initial term no greater than two years, and renewed at least annually thereafter, (i) by the vote of the Trustees or by a vote of the shareholders of each series or fund of the Trust (individually a “Fund” ), and (ii) by the vote of a majority of the Trustees who are not parties to the Advisory Agreement or “interested persons” of any party thereto (the “Independent Trustees”) cast in person at a meeting called for the purpose of voting on such approval.
The Board meets quarterly and takes into account throughout the year matters bearing on each Fund’s Advisory Agreement. The Board and its standing committees consider at each meeting factors that are relevant to the annual renewal of an Advisory Agreement, including the services and support provided to a Fund and its shareholders.
On December 6, 2006, the Independent Trustees first met in person with their independent legal counsel (“Independent Legal Counsel”) to consider information provided by the Adviser and others to assist the Trustees in considering whether to renew each Fund’s Advisory Agreement for a one year term beginning May 1, 2007. Immediately following such meeting of the Independent Trustees, all Trustees met in person with the Adviser, Trust counsel, Independent Legal Counsel and others to consider such matters, and give preliminary consideration to information bearing on continuation of each Advisory Agreement. The primary purpose of the December 6 and 7, 2006 meeting was to ensure that the Trustees had ample opportunity to consider matters they deemed relevant in considering the continuation of an Advisory Agreement, and to request any additional information they considered reasonably necessary to their deliberations.
In preparation for the December 6 and 7, 2006 meeting the Trustees were provided, at the request of the Trustees, with a wide range of information to assist in their deliberations, including (i) reports from Lipper Inc. describing a Fund’s (a) performance rankings (where “first quintile” denotes the best performance) (over multiple years ended September 30, 2006) compared with performance groups and performance universes created by Lipper (and in some cases, customized peer groups created by the Adviser) of similar or peer group funds, and (b) expense rankings (where “first quintile” denotes the lowest fees and expenses) comparing the Fund’s contractual advisory fee and total expenses with expense groups and expense universes created by Lipper of similar or peer group funds, (ii) information from the Adviser describing the Fund’s performance (over multiple years ended September 30, 2006) compared with its benchmark and Lipper categories, (iii) for Funds under “close review,” copies of letters from the Adviser to the portfolio manager of each such Fund, together with the portfolio manager’s written response describing the reasons for the Fund’s underperformance (iv) information from the Adviser describing performance for the months of October and November, 2006, and annual performance for the year ended November 30, 2006, (v) reports from the Adviser describing the Adviser’s profitability in providing services under an Advisory Agreement, together with an explanation of Adviser’s methodology in calculating its profitability, (vi) information from the Adviser describing any fees paid to the Adviser for managing similar, non-affiliated institutional accounts, including the range of fee levels for such accounts, and (vii) information from the Adviser describing ancillary benefits, in addition to fees for serving as investment adviser, derived by the Adviser as a result of being investment adviser for a Fund, including, where applicable, information on soft-dollar benefits and fees inuring to the Adviser’s affiliates for serving as the Trust’s administrator, fund accountant and transfer agent.
At the December 6 and 7, 2006 meeting, the Trustees reviewed, considered and discussed, among themselves and with the Adviser, Trust counsel and Independent Legal Counsel, among other things, the information described above, and: (i) the nature, extent and quality of services provided by the Adviser under each Advisory Agreement, (ii) the investment performance of each Fund and the Adviser, (iii) the costs of the services provided by the Adviser under the Advisory Agreement and the profits realized by the Adviser thereunder, (iv) the extent to which economies of scale may be present and, if so, whether they are being shared with a Fund’s shareholders, (v) comparisons of the Adviser’s fees under the Advisory Agreement with investment advisory fees paid by peer group funds to their investment advisers and paid by non-affiliated institutional clients to the Adviser for managing similar accounts, and (vi) any ancillary benefits inuring to the Adviser and its affiliates as a result of being investment adviser for the Trust. The Trustees also considered, where
As part of the December 6 and 7, 2006 Board meeting, the Independent Trustees developed a list of follow-up matters and questions and asked that Adviser respond to such matters and questions at the contract approval meeting of the Board of Trustees to be held on January 11, 2007.
At the January 11, 2007 meeting of the Board of Trustees of the Trust, the Board received and considered information provided by the Adviser in follow-up from the December 6 and 7, 2006 Board meeting and, after consulting among themselves, and with the Adviser, Trust counsel and Independent Legal Counsel, concluded unanimously to renew the Advisory Agreement for the reasons set forth in the following section. In determining whether to renew the Advisory Agreement for the Fund, the Board ultimately reached a determination, with the assistance of Trust counsel and Independent Legal Counsel, that the renewal of the Advisory Agreement and the compensation to be received by the Adviser under the Advisory Agreement is consistent with the Board’s fiduciary duty under applicable law.
(ii) | Board Conclusions Regarding the Fund’s Advisory Agreement |
The Board considered that the Fund had underperformed its benchmark, the MSCI Emerging Markets Index, for the one-, three-, and five-year periods. The Board also considered that the Fund’s Class II shares had ranked in the fifth quintile of the Fund’s Lipper-constructed Performance Group over the one-, two-, three-, four-, and five-year periods. Although the Fund’s performance compared with peer group funds over the periods considered ranked the Fund in the fifth quintile, the Board found that: (i) the portfolio manager for the Fund was changed during the year; (ii) recent performance had shown improvement; and (iii) the flows in and out of the Fund had been more extreme, which made management more difficult, and had affected performance. Based on its review, and giving particular weight to the nature and quality of the resources dedicated by the adviser and subadviser to improve relative performance, the Board concluded that the nature, extent, and quality of the services provided to the Fund will benefit the Fund’s shareholders.
The Board also considered that the Fund’s contractual advisory fee and breakpoints placed the Fund in the first quintile of its Lipper-constructed Expense Group and the Fund’s total expenses placed it in the second quintile. The Board considered that the Fund had implemented a performance fee structure, which is intended to either reward or penalize the adviser for outperforming or underperforming, respectively, the Fund’s benchmark. The Board concluded that the Fund’s management fee and total expenses were fair and reasonable in light of the services that the Fund receives and the other factors considered.
The Board considered that the Fund’s adviser reported a pre-tax profit margin for investment management services during each of the twelve month-periods ended September 30, 2006 and 2005. The Board considered the costs of the services provided by and the profits realized by the adviser in connection with the operation of the Fund and determined that the amount of profit is a fair entrepreneurial profit for the management of the Fund.
Based upon its evaluation of all of the conclusions noted above, and after considering all material factors with respect to the Fund, the Board ultimately concluded that the advisory fee structure is fair and reasonable, and that the Advisory Agreement (and, if applicable, Sub-Advisory Agreement) with respect to the Fund, should be renewed.
B. Approval of New Advisory Agreement
At its January 11, 2007 meeting, the Board also unanimously approved a new investment advisory agreement (the “New Agreement”) for the Fund with Nationwide Fund Advisors, (“NFA”) the then-current adviser to each of the series of the Trust to become effective upon the closing of the acquisition of NFA by Nationwide Financial Services, Inc. (“NFS”) from Nationwide Corporation (“NWC”) which closed on April 30, 2007 (the “Transaction”). In approving the New Agreement, the Board considered NFA’s capacity to continue to provide the services needed to operate a sophisticated investment management business and to support the management of each of the series. The Board also took into account
C. Submission of Matters to a Vote of Security Holders:
On April 25, 2007, a Special Meeting of Shareholders was held* (the “April 25 Meeting”) at which shareholders of the Funds** set forth below were asked:
Proposal 1:
To approve a new investment advisory agreement, on behalf of their Fund, between Nationwide Fund Advisors (formerly “Gartmore Mutual Fund Capital Trust”) (the “Adviser”) and Nationwide Variable Insurance Trust (formerly “Gartmore Variable Insurance Trust”) (the “Trust”).
Number of Shares | ||||||
Fund | Cast/Not Cast | Percentages | ||||
Federated NVIT High Income Bond Fund (Formerly Federated GVIT High Income Bond Fund) | FOR AGAINST ABSTAIN TOTAL | 30,051,703.188 shares 618,245.021 shares 1,813,550.431 shares 32,483,498.640 shares | 92.514% 1.903% 5.583% | |||
NVIT International Index Fund (Formerly GVIT International Index Fund) | FOR AGAINST ABSTAIN TOTAL | 4,322,203.982 shares 2,758.318 shares 135,636.840 shares 4,460,599.140 shares | 96.897% 0.062% 3.041% | |||
NVIT International Value Fund (Formerly GVIT International Value Fund) | FOR AGAINST ABSTAIN TOTAL | 20,032,843.199 shares 333,588.902 shares 1,093,293.879 shares 21,459,725.980 shares | 93.351% 1.554% 5.095% | |||
NVIT Mid Cap Index Fund (Formerly GVIT Mid Cap Index Fund) | FOR AGAINST ABSTAIN TOTAL | 35,380,179.120 shares 631,117.844 shares 1,565,714.306 shares 37,577,011.270 shares | 94.154% 1.679% 4.167% |
Number of Shares | ||||||
Fund | Cast/Not Cast | Percentages | ||||
NVIT S&P 500 Index Fund (Formerly GVIT S&P 500 Index Fund) | FOR AGAINST ABSTAIN TOTAL | 56,119,814.230 shares 666,195.542 shares 1,944,898.888 shares 58,730,908.660 shares | 95.554% 1.134% 3.312% | |||
Nationwide Multi-Manager NVIT Small Cap Growth Fund (Formerly GVIT Small Cap Growth Fund) | FOR AGAINST ABSTAIN TOTAL | 7,632,918.513 shares 149,458.111 shares 451,583.036 shares 8,233,959.660 shares | 92.700% 1.816% 5.484% | |||
Nationwide Multi-Manager NVIT Small Cap Value Fund (Formerly GVIT Small Cap Value Fund) | FOR AGAINST ABSTAIN TOTAL | 48,649,396.525 shares 979,183.753 shares 2,786,133.102 shares 52,414,713.380 shares | 92.816% 1.868% 5.316% | |||
Nationwide Multi-Manager NVIT Small Company Fund (Formerly GVIT Small Company Fund) | FOR AGAINST ABSTAIN TOTAL | 29,903,181.700 shares 838,774.923 shares 2,006,741.307 shares 32,748,697.930 shares | 91.311% 2.561% 6.128% | |||
Gartmore NVIT Developing Markets Fund (Formerly Gartmore GVIT Developing Markets Fund) | FOR AGAINST ABSTAIN TOTAL | 21,0177,889.443 shares 424,272.958 shares 1,543,850.729 shares 23,046,013.130 shares | 91.460% 1.841% 6.699% | |||
Gartmore NVIT Emerging Markets Fund (Formerly Gartmore GVIT Emerging Markets Fund) | FOR AGAINST ABSTAIN TOTAL | 17,050,534.593 shares 526,574.722 shares 881,608.905 shares 18,458,718.220 shares | 92.371% 2.853% 4.776% | |||
Nationwide NVIT Global Financial Services Fund (Formerly Gartmore GVIT Global Financial Services Fund) | FOR AGAINST ABSTAIN TOTAL | 1,554,847.333 shares 19,539.033 shares 52,206.494 shares 1,626,592.860 shares | 95.589% 1.201% 3.210% | |||
Nationwide NVIT Global Health Sciences Fund (Formerly Gartmore GVIT Global Health Sciences Fund) | FOR AGAINST ABSTAIN TOTAL | 4,722,963.678 shares 157,979.030 shares 207,642.222 shares 5,088,584.930 shares | 92.815% 3.104% 4.081% | |||
Nationwide NVIT Global Technology and Communications Fund (Formerly Gartmore GVIT Global Technology and Communications Fund) | FOR AGAINST ABSTAIN TOTAL | 8,585,472.039 shares 102,267.977 shares 489,577.634 shares 9,177,317.650 shares | 93.551% 1.114% 5.335% | |||
Gartmore NVIT Global Utilities Fund (Formerly Gartmore GVIT Global Utilities Fund) | FOR AGAINST ABSTAIN TOTAL | 4,123,270.549 shares 122,001.533 shares 240,276.088 shares 4,485,548.170 shares | 91.923% 2.720% 5.357% | |||
Nationwide NVIT Government Bond Fund (Formerly Gartmore GVIT Government Bond Fund) | FOR AGAINST ABSTAIN TOTAL | 88,471,567.462 shares 1,825,645.181 shares 5,841,990.727 shares 96,139,203.370 shares | 92.024% 1.899% 6.077% |
Number of Shares | ||||||
Fund | Cast/Not Cast | Percentages | ||||
Nationwide NVIT Growth Fund (Formerly Gartmore GVIT Growth Fund) | FOR AGAINST ABSTAIN TOTAL | 14,931,435.904 shares 409,826.402 shares 1,259,945.064 shares 16,601,207.370 shares | 89.942% 2.469% 7.589% | |||
Gartmore NVIT International Growth Fund (Formerly Gartmore GVIT International Growth Fund) | FOR AGAINST ABSTAIN TOTAL | 6,251,419.070 shares 139,618.548 shares 290,025.592 shares 6,681,063.210 shares | 93.569% 2.090% 4.341% | |||
Nationwide NVIT Investor Destinations Aggressive Fund (Formerly Gartmore GVIT Investor Destinations Aggressive Fund) | FOR AGAINST ABSTAIN TOTAL | 49,489,224.549 shares 1,385,396.474 shares 3,696,272.337 shares 54,570,893.360 shares | 90.688% 2.539% 6.773% | |||
Nationwide NVIT Investor Destinations Conservative Fund (Formerly Gartmore GVIT Investor Destinations Conservative Fund) | FOR AGAINST ABSTAIN TOTAL | 23,091,965.887 shares 314,935,884 shares 2,292,355.179 shares 25,699,256.950 shares | 89.855% 1.225% 8.920% | |||
Nationwide NVIT Investor Destinations Moderate Fund (Formerly Gartmore GVIT Investor Destinations Moderate Fund) | FOR AGAINST ABSTAIN TOTAL | 188,902,093.059 shares 3,018,924.590 shares 16,359,690.401 shares 208,280,708.050 shares | 90.696% 1.449% 7.855% | |||
Nationwide NVIT Investor Destinations Moderately Aggressive Fund (Formerly Gartmore GVIT Investor Destinations Moderately Aggressive Fund) | FOR AGAINST ABSTAIN TOTAL | 134,792,622.920 shares 3,489,207.264 shares 9,304,197.656 shares 147,586,027.840 shares | 91.332% 2.364% 6.304% | |||
Nationwide NVIT Investor Destinations Moderately Conservative Fund (Formerly Gartmore GVIT Investor Destinations Moderately Conservative Fund) | FOR AGAINST ABSTAIN TOTAL | 49,627,123.216 shares 856,088.634 shares 3,507,215.650 shares 53,990,427.500 shares | 91.918% 1.586% 6.496% | |||
Nationwide NVIT Mid Cap Growth Fund (Formerly Gartmore GVIT Mid Cap Growth Fund) | FOR AGAINST ABSTAIN TOTAL | 10,879,584.971 shares 352,594.958 shares 717,792.971 shares 11,949,972.900 shares | 91.043% 2.950% 6.007% | |||
Nationwide NVIT Money Market Fund II (Formerly Gartmore GVIT Money Market Fund II) | FOR AGAINST ABSTAIN TOTAL | 221,774,863.241 shares 12,322,482.494 shares 16,471,740.875 shares 250,569,086.610 shares | 88.508% 4.918% 6.574% | |||
Nationwide NVIT Money Market Fund (Formerly Gartmore GVIT Money Market Fund) | FOR AGAINST ABSTAIN TOTAL | 1,578,331,008.328 shares 32,372,133.671 shares 112,652,123.301 shares 1,723,355,265.300 shares | 91.585% 1.878% 6.537% | |||
NVIT Nationwide Fund (Formerly Gartmore GVIT Nationwide Fund) | FOR AGAINST ABSTAIN TOTAL | 125,423,274.735 shares 2,767,979.467 shares 8,762,255.828 shares 136,953,510.030 shares | 91.581% 2.021% 6.398% |
Number of Shares | ||||||
Fund | Cast/Not Cast | Percentages | ||||
NVIT Nationwide Leaders Fund (Formerly Gartmore GVIT Nationwide Leaders Fund) | FOR AGAINST ABSTAIN TOTAL | 2,298,504.956 shares 29,630.469 shares 71,637.755 shares 2,399,773.180 shares | 95.780% 1.235% 2.985% | |||
Nationwide NVIT U.S. Growth Leaders Fund (Formerly Gartmore GVIT U.S. Growth Leaders Fund) | FOR AGAINST ABSTAIN TOTAL | 4,972,094.773 shares 122,623.161 shares 174,625.606 shares 5,269,343.540 shares | 94.359% 2.327% 3.314% | |||
Gartmore NVIT Worldwide Leaders Fund (Formerly Gartmore GVIT Worldwide Leaders Fund) | FOR AGAINST ABSTAIN TOTAL | 2,666,862.487 shares 47,702.491 shares 118,719.882 shares 2,833,284.860 shares | 94.126% 1.684% 4.190% | |||
JP Morgan NVIT Balanced Fund (Formerly JP Morgan GVIT Balanced Fund) | FOR AGAINST ABSTAIN TOTAL | 15,966,867.546 shares 259,004.324 shares 1,339,385.200 shares 17,565,257.070 shares | 90.900% 1.475% 7.625% | |||
Van Kampen NVIT Comstock Value Fund (Formerly Van Kampen GVIT Comstock Value Fund) | FOR AGAINST ABSTAIN TOTAL | 27,737,008.009 shares 502,564.164 shares 1,824,670.107 shares 30,064,242.280 shares | 92.259% 1.672% 6.069% | |||
Van Kampen NVIT Multi Sector Bond Fund (Formerly Van Kampen GVIT Multi Sector Bond Fund) | FOR AGAINST ABSTAIN TOTAL | 21,253,297.665 shares 484,100.920 shares 1,803,963.645 shares 23,541,362.230 shares | 90.281% 2.056% 7.663% | |||
At the April 25 Meeting, shareholders of the Nationwide NVIT Mid Cap Growth Fund were also asked to approve a new investment subadvisory agreement among the Adviser, the Trust and NorthPointe Capital LLC. The voting results with respect to that proposal are set forth below:
Proposal 2:
Number of Shares | ||||||
Fund | Cast/Not Cast | Percentages | ||||
Nationwide NVIT Mid Cap Growth Fund (Formerly Gartmore GVIT Mid Cap Growth Fund) | FOR AGAINST ABSTAIN TOTAL | 10,862,827.499 shares 414,574.660 shares 672,570.741 shares 11,949,972.900 shares | 90.903% 3.469% 5.628% | |||
* | This meeting was previously adjourned on April 23, 2007. | |
** | Fund names were changed effective May 1, 2007 to reflect “Nationwide”/“NVIT” branding to coincide with the sale of Nationwide Fund Advisors, Inc. by Nationwide Corporation to its majority-owned subsidiary, Nationwide Financial Services, Inc. |
June 30, 2007 (Unaudited)
Contents | ||
6 | Statement of Investments | |
13 | Statement of Assets and Liabilities | |
14 | Statement of Operations | |
15 | Statements of Changes in Net Assets | |
17 | Financial Highlights | |
18 | Notes to Financial Statements |
Statement Regarding Availability of Proxy Voting Record.
SAR-MCX (8/07) | ![]() |
Dear Fellow Shareholder:
Since I last wrote to you, our mutual funds have enjoyed another period of solid performance, and the corporate realignment that was in progress is now finished.
On May 1, 2007, Nationwide Financial Services, Inc. (NFS), completed its acquisition of the Philadelphia-based retail mutual fund operations of NWD Investment Management, Inc. (formerly, “Gartmore Global Investments, Inc.”), from Nationwide Corporation, a subsidiary of Nationwide Mutual Insurance Company. Effective that date, the acquired entities were renamed Nationwide Funds Group (NFG), and the Gartmore Funds were renamed the Nationwide Funds to better align with the Nationwide® brand. Although the corporate ownership and fund names have changed, I can assure you that NFG intends to maintain as much continuity as possible with the Funds and key personnel.
Thank you, shareholders, for approving the new investment advisory agreement that was required due to the change in corporate ownership. The new agreement is identical in all material respects to the original agreement that it replaces, with the exception of the section pertaining to the vote by the shareholders of the NVIT Mid Cap Growth Fund to approve NorthPointe Capital®, LLC (NorthPointe) as sub-adviser to that particular Fund.
Market Overview: January 1-June 30, 2007
Share prices in general were buoyed in part by better-than-expected first-quarter 2007 earnings and a flurry of mergers and acquisitions, many of these spurred by readily available funding from private equity firms. In June, investors grew more cautious amid surging crude oil prices, a sudden spike in long-term interest rates, and the meltdown of two hedge funds that had exposure to the subprime mortgage market. Looking abroad, a weak U.S. dollar aided foreign stocks, as reflected in the 11.09% advance of the Morgan Stanley Capital International Europe, Australasia and Far East (MSCI EAFE®) Index. Emerging market performance was particularly robust.
The bond market struggled during the first half of 2007. While short-term interest rates remained stable, reflecting the Federal Reserve Board’s decision in June to leave the target federal funds rate at 5.25%, longer-term rates climbed during the first half of 2007, depressing bond prices and forcing the Lehman Brothers® U.S. Aggregate Index to settle for a modest 0.97% return.
We at NFG thank you for your understanding and cooperation throughout our recent transition period. We emerge from this period energized for the future, and we look forward to serving your investment needs for a long time to come.
Nationwide Funds Group
PAST PERFORMANCE IS NO GUARANTEE OF FUTURE RESULTS.
Nationwide Funds are advised by Nationwide Fund Advisors (NFA). NFA is a wholly-owned subsidiary of Nationwide Financial Services. Nationwide Financial Services is a wholly-owned subsidiary of Nationwide Corporation. All of the common stock of Nationwide Corporation is held by Nationwide Mutual (95.2%) and Nationwide Mutual Fire Insurance Company (4.8%), each of which is a mutual company owned by its policyholders.
Nationwide Funds Group (NFG) is the mutual fund arm of Nationwide Financial Services (NYSE: NFS). Based in Conshohocken, Pa., a suburb of Philadelphia, NFG is comprised of Nationwide Fund Advisors, Nationwide Fund Distributors, LLC, and Nationwide Fund Management, LLC. Together, these provide advisory, distribution, and administration services respectively to the Nationwide Funds, and manage more than $43.5 billion in assets as of June 30, 2007, of which more than $12 billion are in “fund of funds” designed to provide asset allocation across several types of investments and asset classes.
Lehman Brothers (LB) U.S. Aggregate Index: An unmanaged, market value-weighted index of investment-grade, fixed-rate debt issues (including government, corporate, asset-backed, and mortgage-backed securities with maturities of one year or more) that is generally representative of the bond market as a whole.
Morgan Stanley Capital International Europe, Australasia and Far East (MSCI EAFE®) Index: An unmanaged, free float-adjusted, market capitalization-weighted index that is designed to measure the performance of stocks in developed markets outside the United States and Canada.
Standard & Poor’s 500® (S&P 500) Index: An unmanaged, market capitalization-weighted index of 500 widely held stocks of large-cap U.S. companies that gives a broad look at how the stock prices of those companies have performed.
Views expressed within are those of Nationwide Funds Group as of the date noted, are subject to change at any time, and may not come to pass.
This report is for informational purposes only, and is not intended as an offer or recommendation with respect to the purchase or sale of any security, option, future, or other derivatives in such securities.
Investing in mutual funds involves risk, including possible loss of principal.
Investors should carefully consider a fund’s investment objectives, risks, fees, charges, and expenses before investing any money. To obtain this and other fund information, please call 800-848-0920 to request a prospectus, or download a prospectus at www.nationwidefunds.com. Please read the prospectus carefully before investing any money.
Nationwide Funds distributed by Nationwide Fund Distributors LLC (formerly Gartmore Distribution Services, Inc.), Member NASD. 1200 River Road, Suite 1000, Conshohocken, Pa. 19428.
As a shareholder of the Fund, you incur two types of costs: (1) transaction costs, including sales charges (loads) paid on purchase payments and redemption fees; and (2) ongoing costs, including investment advisory fees, administration fees, distribution fees and other Fund expenses. The examples below are 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. Per SEC requirements, the examples assume that you had a $1,000 investment in the Class at the beginning of the reporting period, January 1, 2007, and continued to hold your shares at the end of the reporting period, June 30, 2007.
Actual Expenses
Hypothetical Example for Comparison Purposes
Please note that the expenses shown in the table are meant to highlight your ongoing costs only and do not reflect any transaction costs, such as sales charges (loads) or redemption fees. Therefore, the second line for each Class in 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 transaction costs were included, your costs would have been higher. The examples also assume all dividends and distributions have been reinvested.
Schedule of Shareholder Expenses
NVIT Mid Cap Index Fund | ||||||||||||||||||||||
Ending | ||||||||||||||||||||||
Beginning | Account | |||||||||||||||||||||
Account Value, | Value, | Expenses Paid | Annualized | |||||||||||||||||||
January 1, 2007 | June 30, 2007 | During Period* | Expense Ratio* | |||||||||||||||||||
Class I | Actual | $ | 1,000.00 | $ | 1,117.60 | $ | 2.36 | 0.45% | ||||||||||||||
Hypothetical | 1 | $ | 1,000.00 | $ | 1,022.57 | $ | 2.26 | 0.45% | ||||||||||||||
Class II | Actual | $ | 1,000.00 | $ | 1,116.20 | $ | 3.57 | 0.68% | ||||||||||||||
Hypothetical | 1 | $ | 1,000.00 | $ | 1,021.43 | $ | 3.41 | 0.68% | ||||||||||||||
Class ID | Actual | $ | 1,000.00 | $ | 1,118.40 | $ | 1.58 | 0.30% | ||||||||||||||
Hypothetical | 1 | $ | 1,000.00 | $ | 1,023.31 | $ | 1.51 | 0.30% | ||||||||||||||
* | Expenses are equal to the Fund’s annualized expense ratio multiplied by the average account value over the period multiplied by 181/365 (to reflect the one-half year period). The expense ratio presented represents a six-month, annualized ratio in accordance with SEC guidelines. The expenses reported above do not include the effect of additional expenses imposed by variable annuity contracts. | |
1 | Represents the hypothetical 5% return before expenses. |
Asset Allocation | ||||
Common Stock | 89.7% | |||
Repurchase Agreements | 11.9% | |||
Other Investments* | 12.8% | |||
Liabilities in excess of other assets** | -14.4% | |||
100.0% |
Top Holdings*** | ||||
Noble Energy, Inc. | 0.8% | |||
Expeditors International of Washington, Inc. | 0.7% | |||
Microchip Technology, Inc. | 0.6% | |||
Lyondell Chemical Co. | 0.6% | |||
Manpower, Inc. | 0.6% | |||
Cameron International Corp. | 0.6% | |||
Southwestern Energy Co. | 0.6% | |||
Harris Corp. | 0.6% | |||
Lam Research Corp. | 0.5% | |||
Martin Marietta Materials, Inc. | 0.5% | |||
Other | 93.9% | |||
100.0% |
Top Industries | ||||
Oil, Gas & Consumable Fuels | 5.8% | |||
Specialty Retail | 4.8% | |||
Insurance | 4.2% | |||
Machinery | 4.1% | |||
Real Estate Investment Trusts (REITs) | 3.4% | |||
Chemicals | 3.3% | |||
Health Care Providers & Services | 3.2% | |||
Commercial Services & Supplies | 3.2% | |||
Semiconductors & Semiconductor Equipment | 3.1% | |||
Health Care Equipment & Supplies | 3.0% | |||
Other | 61.9% | |||
100.0% |
* | Includes value of collateral received from securities lending. |
** | Includes value of collateral owed from securities lending. |
*** | For purpose of listing top holdings, repurchase agreements are included as part of Other. |
NVIT Mid Cap Index Fund
Common Stock (89.7%) | ||||||||
Shares or | ||||||||
Principal Amount | Value | |||||||
Aerospace & Defense (0.4%) (a) | ||||||||
Alliant Techsystems, Inc.* | 36,000 | $ | 3,569,400 | |||||
DRS Technologies, Inc. | 44,500 | 2,548,515 | ||||||
6,117,915 | ||||||||
Air Freight & Logistics (0.7%) | ||||||||
Expeditors International of Washington, Inc. | 222,900 | 9,205,770 | ||||||
Airlines (0.3%) (a) | ||||||||
AirTran Holdings, Inc.* | 86,600 | 945,672 | ||||||
Alaska Air Group, Inc.* | 44,200 | 1,231,412 | ||||||
JetBlue Airways Corp.* | 195,000 | 2,291,250 | ||||||
4,468,334 | ||||||||
Auto Components (0.9%) | ||||||||
ArvinMeritor, Inc. (a) | 74,025 | 1,643,355 | ||||||
BorgWarner Automotive, Inc. | 59,000 | 5,076,360 | ||||||
Gentex Corp. | 154,600 | 3,044,074 | ||||||
Lear Corp.* | 77,540 | 2,761,199 | ||||||
Modine Manufacturing Co. (a) | 30,900 | 698,340 | ||||||
13,223,328 | ||||||||
Automobiles (0.3%) | ||||||||
Avis Budget Group, Inc.* | 102,340 | 2,909,526 | ||||||
Thor Industries, Inc. (a) | 35,300 | 1,593,442 | ||||||
4,502,968 | ||||||||
Beverages (0.3%) | ||||||||
Hansen Natural Corp.* (a) | 65,000 | 2,793,700 | ||||||
PepsiAmericas, Inc. | 57,000 | 1,399,920 | ||||||
4,193,620 | ||||||||
Biotechnology (0.9%) (a) | ||||||||
Cephalon, Inc.* | 70,700 | 5,683,573 | ||||||
PDL Biopharma, Inc.* | 118,600 | 2,763,380 | ||||||
Vertex Pharmaceuticals, Inc.* | 135,790 | 3,878,162 | ||||||
12,325,115 | ||||||||
Building Products (0.5%) (a) | ||||||||
Martin Marietta Materials, Inc. | 45,280 | 7,336,266 | ||||||
Capital Markets (1.7%) | ||||||||
Edwards (A.G.), Inc. | 78,700 | 6,654,085 | ||||||
Jefferies Group, Inc. | 115,000 | 3,102,700 | ||||||
Nuveen Investments, Inc., Class A | 80,750 | 5,018,612 | ||||||
Raymond James Financial, Inc. | 92,525 | 2,859,023 | ||||||
SEI Investments Co. | 130,200 | 3,781,008 | ||||||
Waddell & Reed Financial, Inc. | 89,500 | 2,327,895 | ||||||
23,743,323 | ||||||||
Chemicals (3.3%) | ||||||||
Airgas, Inc. | 79,400 | 3,803,260 | ||||||
Albemarle Corp. | 85,800 | 3,305,874 | ||||||
Cabot Corp. | 64,600 | 3,080,128 | ||||||
Chemtura Corp. | 243,800 | 2,708,618 | ||||||
Cytec Industries, Inc. | 41,900 | 2,671,963 | ||||||
Ferro Corp. (a) | 47,100 | 1,174,203 | ||||||
FMC Corp. | 39,800 | 3,557,722 | ||||||
Lubrizol Corp. | 74,500 | 4,808,975 | ||||||
Lyondell Chemical Co. | 224,800 | 8,344,576 | ||||||
Minerals Technologies, Inc. | 21,800 | 1,459,510 | ||||||
Olin Corp. (a) | 82,300 | 1,728,300 | ||||||
RPM International, Inc. (a) | 120,600 | 2,787,066 | ||||||
Scotts Miracle-Gro Co. (The)(a) | 47,800 | 2,052,532 | ||||||
Sensient Technologies Corp. (a) | 47,200 | 1,198,408 | ||||||
Valspar Corp. | 102,400 | 2,909,184 | ||||||
45,590,319 | ||||||||
Commercial Banks (2.4%) | ||||||||
Associated Banc Corp. (a) | 132,215 | 4,323,430 | ||||||
Bank of Hawaii Corp. | 50,000 | 2,582,000 | ||||||
Cathay General Bancorp, Inc. (a) | 48,700 | 1,633,398 | ||||||
City National Corp. | 44,800 | 3,408,832 | ||||||
Colonial Bancgroup, Inc. | 157,000 | 3,920,290 | ||||||
Cullen/ Frost Bankers, Inc. | 65,560 | 3,505,493 | ||||||
First Community Bancorp | 27,450 | 1,570,415 | ||||||
FirstMerit Corp. (a) | 77,600 | 1,624,168 | ||||||
Greater Bay Bancorp | 52,100 | 1,450,464 | ||||||
SVB Financial Group* (a) | 38,900 | 2,065,979 | ||||||
TCF Financial Corp. | 116,300 | 3,233,140 | ||||||
West America Bankcorp (a) | 33,500 | 1,482,040 | ||||||
Wilmington Trust Corp. | 68,300 | 2,835,133 | ||||||
33,634,782 | ||||||||
Commercial Services & Supplies (3.2%) | ||||||||
Brink’s Co. (The) | 52,500 | 3,249,225 | ||||||
ChoicePoint, Inc.* | 84,933 | 3,605,406 | ||||||
Copart, Inc.* | 70,800 | 2,165,772 | ||||||
Corporate Executive Board Co. | 41,400 | 2,687,274 | ||||||
Deluxe Corp. | 51,900 | 2,107,659 | ||||||
Dun & Bradstreet Corp. | 63,500 | 6,539,230 | ||||||
Herman Miller, Inc. (a) | 64,000 | 2,022,400 | ||||||
Kelly Services, Inc. (a) | 19,600 | 538,216 | ||||||
Korn/ Ferry International* | 47,100 | 1,236,846 | ||||||
Manpower, Inc. | 89,600 | 8,264,704 | ||||||
Mine Safety Appliances Co. (a) | 27,800 | 1,216,528 | ||||||
Navigant Consulting, Inc.*(a) | 45,180 | 838,541 | ||||||
Republic Services, Inc. | 176,350 | 5,403,364 |
Common Stock (continued) | ||||||||
Shares or | ||||||||
Principal Amount | Value | |||||||
Commercial Services & Supplies (continued) | ||||||||
Rollins, Inc. (a) | 27,700 | $ | 630,729 | |||||
Stericycle, Inc.* | 95,000 | 4,223,700 | ||||||
44,729,594 | ||||||||
Communications Equipment (2.4%) | ||||||||
3COM Corp.* | 401,700 | 1,659,021 | ||||||
ADC Telecommunications, Inc.* | 114,630 | 2,101,168 | ||||||
Adtran, Inc. (a) | 68,500 | 1,778,945 | ||||||
Andrew Corp.* (a) | 166,600 | 2,405,704 | ||||||
Avocent Corp.* (a) | 53,400 | 1,549,134 | ||||||
CommScope, Inc.* | 62,600 | 3,652,710 | ||||||
Dycom Industries, Inc.* (a) | 39,100 | 1,172,218 | ||||||
F5 Networks, Inc.* | 42,700 | 3,441,620 | ||||||
Harris Corp. | 142,800 | 7,789,740 | ||||||
NeuStar, Inc.* | 70,560 | 2,044,123 | ||||||
Plantronics, Inc. (a) | 46,600 | 1,221,852 | ||||||
Polycom, Inc.* | 98,600 | 3,312,960 | ||||||
Powerwave Technologies, Inc.* (a) | 129,100 | 864,970 | ||||||
U.T. Starcom, Inc.* (a) | 105,500 | 591,855 | ||||||
33,586,020 | ||||||||
Computers & Peripherals (0.8%) | ||||||||
Diebold, Inc. | 71,600 | 3,737,520 | ||||||
Imation Corp. | 35,800 | 1,319,588 | ||||||
Palm, Inc.* (a) | 113,000 | 1,809,130 | ||||||
Western Digital Corp.* | 236,800 | 4,582,080 | ||||||
11,448,318 | ||||||||
Construction & Engineering (1.5%) | ||||||||
Granite Construction, Inc. | 35,550 | 2,281,599 | ||||||
Jacobs Engineering Group, Inc.* | 123,700 | 7,113,987 | ||||||
KBR, Inc.* | 173,760 | 4,557,725 | ||||||
NVR, Inc.* (a) | 4,900 | 3,330,775 | ||||||
Quanta Services, Inc.* (a) | 122,400 | 3,754,008 | ||||||
21,038,094 | ||||||||
Construction Materials (0.2%) | ||||||||
Florida Rock Industries, Inc. | 50,200 | 3,388,500 | ||||||
Consumer Finance (0.6%) | ||||||||
AmeriCredit Corp.* (a) | 120,290 | 3,193,699 | ||||||
Eaton Vance Corp. | 131,500 | 5,809,670 | ||||||
9,003,369 | ||||||||
Containers & Packaging (0.5%) | ||||||||
Packaging Corp. of America | 81,200 | 2,055,172 | ||||||
Sonoco Products Co. | 101,100 | 4,328,091 | ||||||
6,383,263 | ||||||||
Diversified Consumer Services (1.8%) | ||||||||
Career Education Corp.* | 99,600 | 3,363,492 | ||||||
Corinthian Colleges, Inc.* (a) | 96,700 | 1,575,243 | ||||||
DeVry, Inc. | 59,700 | 2,030,994 | ||||||
Global Payments, Inc. (a) | 70,490 | 2,794,929 | ||||||
ITT Educational Services, Inc.* | 34,300 | 4,026,134 | ||||||
Laureate Education, Inc.* | 51,900 | 3,200,154 | ||||||
Matthews International Corp., Class A (a) | 34,020 | 1,483,612 | ||||||
Regis Corp. | 45,800 | 1,751,850 | ||||||
Sotheby’s Holdings, Inc. | 60,300 | 2,775,006 | ||||||
Strayer Education, Inc. (a) | 15,600 | 2,054,676 | ||||||
25,056,090 | ||||||||
Diversified Financial Services (0.6%) | ||||||||
Broadridge Financial Solutions, Inc. | 146,040 | 2,792,285 | ||||||
Leucadia National Corp. (a) | 169,900 | 5,988,975 | ||||||
8,781,260 | ||||||||
Diversified Telecommunication Services (0.1%) | ||||||||
Cincinnati Bell, Inc.* | 245,900 | 1,421,302 | ||||||
Electric Utilities (1.9%) | ||||||||
DPL, Inc. (a) | 120,900 | 3,426,306 | ||||||
Gilead Sciences, Inc. | 166,600 | 4,724,776 | ||||||
Great Plains Energy, Inc. (a) | 87,100 | 2,536,352 | ||||||
Hawaiian Electric Industries, Inc. (a) | 78,800 | 1,866,772 | ||||||
IDACORP, Inc. (a) | 50,000 | 1,602,000 | ||||||
Pepco Holdings, Inc. | 206,638 | 5,827,191 | ||||||
Sierra Pacific Resources* | 224,310 | 3,938,884 | ||||||
Westar Energy, Inc. | 97,500 | 2,367,300 | ||||||
26,289,581 | ||||||||
Electrical Equipment (1.1%) | ||||||||
Ametek, Inc. | 107,750 | 4,275,520 | ||||||
Hubbell, Inc. | 59,600 | 3,231,512 | ||||||
Roper Industries, Inc. | 89,700 | 5,121,870 | ||||||
Thomas & Betts Corp.* | 52,600 | 3,050,800 | ||||||
15,679,702 | ||||||||
Electronic Equipment & Instruments (2.4%) | ||||||||
Amphenol Corp., Class A | 187,100 | 6,670,115 | ||||||
Arrow Electronics, Inc.* | 125,400 | 4,819,122 | ||||||
Avnet, Inc.* | 136,000 | 5,391,040 | ||||||
CDW Corp.* | 62,200 | 5,285,134 | ||||||
Ingram Micro, Inc.* | 143,500 | 3,115,385 | ||||||
Kemet Corp.* (a) | 89,300 | 629,565 | ||||||
National Instruments Corp. (a) | 56,150 | 1,828,805 |
NVIT Mid Cap Index Fund (Continued)
�� | ||||||||
Common Stock (continued) | ||||||||
Shares or | ||||||||
Principal Amount | Value | |||||||
Electronic Equipment & Instruments (continued) | ||||||||
Tech Data Corp.* | 60,500 | $ | 2,326,830 | |||||
Vishay Intertechnology, Inc.* | 186,750 | 2,954,385 | ||||||
33,020,381 | ||||||||
Energy Equipment & Services (2.3%) | ||||||||
Cameron International Corp.* | 115,300 | 8,240,491 | ||||||
FMC Technologies, Inc.* | 70,321 | 5,570,830 | ||||||
Grant Prideco, Inc.* | 133,300 | 7,175,539 | ||||||
Hanover Compressor Co.* (a) | 103,623 | 2,471,408 | ||||||
Helmerich & Payne, Inc. | 104,300 | 3,694,306 | ||||||
Tidewater, Inc. | 62,000 | 4,394,560 | ||||||
31,547,134 | ||||||||
Food & Staples Retailing (0.3%) | ||||||||
BJ’s Wholesale Club, Inc.* | 70,100 | 2,525,703 | ||||||
Ruddick Corp. (a) | 32,700 | 984,924 | ||||||
3,510,627 | ||||||||
Food Products (0.9%) | ||||||||
Hormel Foods Corp. | 72,400 | 2,704,140 | ||||||
J.M. Smucker Co. | 61,567 | 3,919,355 | ||||||
Lancaster Colony Corp. | 23,300 | 976,037 | ||||||
Smithfield Foods, Inc.* | 128,390 | 3,953,128 | ||||||
Tootsie Roll Industries, Inc. (a) | 24,902 | 690,035 | ||||||
12,242,695 | ||||||||
Gaming (0.2%) | ||||||||
Boyd Gaming Corp. | 47,400 | 2,331,606 | ||||||
Gas Utilities (1.1%) | ||||||||
AGL Resources, Inc. | 77,700 | 3,145,296 | ||||||
National Fuel Gas Co. (a) | 90,800 | 3,932,548 | ||||||
Oneok, Inc. | 116,100 | 5,852,601 | ||||||
WGL Holdings, Inc. (a) | 56,000 | 1,827,840 | ||||||
14,758,285 | ||||||||
Health Care Equipment & Supplies (3.0%) | ||||||||
Advanced Medical Optics, Inc.* (a) | 65,086 | 2,270,200 | ||||||
Beckman Coulter, Inc. | 67,000 | 4,333,560 | ||||||
Cytyc Corp.* | 118,600 | 5,112,846 | ||||||
Dentsply International, Inc. | 162,700 | 6,224,902 | ||||||
Edwards Lifesciences Corp.* (a) | 62,300 | 3,073,882 | ||||||
Gen-Probe, Inc.* | 56,600 | 3,419,772 | ||||||
Hillenbrand Industry, Inc. | 61,900 | 4,023,500 | ||||||
Intuitive Surgical, Inc.* | 39,800 | 5,523,046 | ||||||
ResMed, Inc.* | 78,900 | 3,255,414 | ||||||
Steris Corp. | 71,700 | 2,194,020 | ||||||
Ventana Medical Systems, Inc.* | 35,770 | 2,763,948 | ||||||
42,195,090 | ||||||||
Health Care Providers & Services (3.2%) | ||||||||
Apria Healthcare Group, Inc.* | 42,700 | 1,228,479 | ||||||
Community Health Systems, Inc.* | 102,300 | 4,138,035 | ||||||
Health Management Associates, Inc., Class A | 264,650 | 3,006,424 | ||||||
Health Net, Inc.* | 119,900 | 6,330,720 | ||||||
Henry Schein, Inc.* | 90,200 | 4,819,386 | ||||||
Kindred Healthcare, Inc.* (a) | 34,790 | 1,068,749 | ||||||
LifePoint Hospitals, Inc.* | 63,200 | 2,444,576 | ||||||
Lincare Holdings, Inc.* | 92,930 | 3,703,260 | ||||||
Omnicare, Inc. (a) | 126,900 | 4,576,014 | ||||||
Psychiatric Solutions, Inc.* (a) | 54,000 | 1,958,040 | ||||||
Triad Hospitals, Inc.* | 91,108 | 4,897,966 | ||||||
Universal Health Services, Inc. | 58,700 | 3,610,050 | ||||||
VCA Antech, Inc.* | 85,000 | 3,203,650 | ||||||
44,985,349 | ||||||||
Health Care Technology (0.5%) | ||||||||
Cerner Corp.* | 68,730 | 3,812,453 | ||||||
Wellcare Health Plans, Inc.* | 34,090 | 3,085,486 | ||||||
6,897,939 | ||||||||
Hotels, Restaurants & Leisure (1.1%) | ||||||||
Applebee’s International, Inc. (a) | 81,050 | 1,953,305 | ||||||
Bob Evans Farms, Inc. (a) | 35,500 | 1,308,175 | ||||||
Brinker International, Inc. | 119,180 | 3,488,399 | ||||||
CBRL Group, Inc. (a) | 27,900 | 1,185,192 | ||||||
Cheesecake Factory, Inc. (The)* (a) | 81,950 | 2,009,414 | ||||||
International Speedway Corp. | 34,400 | 1,813,224 | ||||||
Ruby Tuesday, Inc. (a) | 55,900 | 1,471,847 | ||||||
Scientific Games Corp.* | 68,300 | 2,387,085 | ||||||
15,616,641 | ||||||||
Household Durables (1.4%) | ||||||||
American Greetings Corp., Class A (a) | 64,100 | 1,815,953 | ||||||
Beazer Homes U.S.A., Inc. (a) | 41,600 | 1,026,272 | ||||||
Blyth Industries, Inc. | 23,900 | 635,262 | ||||||
Furniture Brands International, Inc. (a) | 55,500 | 788,100 | ||||||
Hovnanian Enterprises, Inc.* (a) | 42,800 | 707,484 | ||||||
M.D.C. Holdings, Inc. (a) | 39,100 | 1,890,876 | ||||||
Mohawk Industries Co.* (a) | 56,300 | 5,674,477 | ||||||
Ryland Group, Inc. (The) (a) | 45,800 | 1,711,546 |
Common Stock (continued) | ||||||||
Shares or | ||||||||
Principal Amount | Value | |||||||
Household Durables (continued) | ||||||||
Toll Brothers, Inc.* | 133,600 | $ | 3,337,328 | |||||
Tupperware Corp. | 68,300 | 1,962,942 | ||||||
19,550,240 | ||||||||
Household Products (0.6%) | ||||||||
Church & Dwight, Inc. (a) | 65,750 | 3,186,245 | ||||||
Energizer Holdings, Inc.* | 59,060 | 5,882,376 | ||||||
9,068,621 | ||||||||
Industrial Conglomerates (0.5%) | ||||||||
Carlisle Cos., Inc. | 61,800 | 2,874,318 | ||||||
Sequa Corp., Class A* (a) | 6,300 | 705,600 | ||||||
Teleflex, Inc. | 40,400 | 3,303,912 | ||||||
6,883,830 | ||||||||
Insurance (4.2%) | ||||||||
American Financial Group, Inc. | 69,450 | 2,371,718 | ||||||
Arthur J. Gallagher & Co. (a) | 99,700 | 2,779,636 | ||||||
Brown & Brown, Inc. | 115,600 | 2,906,184 | ||||||
Commerce Group, Inc. (a) | 50,130 | 1,740,514 | ||||||
Everest Re Group Ltd. — BM | 67,400 | 7,322,336 | ||||||
Fidelity National Title Group, Inc., Class A | 234,465 | 5,556,820 | ||||||
First American Financial Corp. | 103,800 | 5,138,100 | ||||||
Hanover Insurance Group, Inc. | 51,000 | 2,488,290 | ||||||
HCC Insurance Holdings, Inc. | 116,650 | 3,897,276 | ||||||
Horace Mann Educators Corp. (a) | 41,200 | 875,088 | ||||||
Mercury General Corp. | 34,500 | 1,901,295 | ||||||
Ohio Casualty Corp. | 61,700 | 2,672,227 | ||||||
Old Republic International Corp. | 234,737 | 4,990,509 | ||||||
Protective Life Corp. | 69,700 | 3,332,357 | ||||||
Stancorp Financial Group, Inc. | 54,000 | 2,833,920 | ||||||
Unitrin, Inc. | 42,400 | 2,085,232 | ||||||
W.R. Berkley Corp. | 178,650 | 5,813,271 | ||||||
58,704,773 | ||||||||
Internet & Catalog Retail (0.2%) (a) | ||||||||
Coldwater Creek, Inc.* | 61,400 | 1,426,322 | ||||||
Netflix, Inc.* | 67,150 | 1,302,039 | ||||||
2,728,361 | ||||||||
Internet Software & Services (0.4%) | ||||||||
Digital River, Inc.* | 44,030 | 1,992,358 | ||||||
ValueClick, Inc.* | 107,200 | 3,158,112 | ||||||
5,150,470 | ||||||||
IT Services (2.1%) | ||||||||
Acxiom Corp. | 68,500 | 1,811,825 | ||||||
Alliance Data Systems Corp.* | 67,900 | 5,247,312 | ||||||
BISYS Group, Inc. (The)* | 116,900 | 1,382,927 | ||||||
Ceridian Corp.* | 146,900 | 5,141,500 | ||||||
CheckFree Corp.* | 94,100 | 3,782,820 | ||||||
CSG Systems International, Inc.* | 45,200 | 1,198,252 | ||||||
DST Systems, Inc.* (a) | 59,500 | 4,712,995 | ||||||
Gartner, Inc.* | 54,700 | 1,345,073 | ||||||
MoneyGram International, Inc. (a) | 87,600 | 2,448,420 | ||||||
MPS Group, Inc.* (a) | 100,200 | 1,339,674 | ||||||
SRA International, Inc.* (a) | 41,100 | 1,038,186 | ||||||
29,448,984 | ||||||||
Leisure Equipment & Products (0.1%) (a) | ||||||||
Callaway Golf Co. | 65,400 | 1,164,774 | ||||||
Life Sciences Tools & Services (1.5%) | ||||||||
Affymetrix, Inc.* (a) | 75,000 | 1,866,750 | ||||||
Charles River Laboratories International, Inc.* | 69,400 | 3,582,428 | ||||||
Covance, Inc.* | 66,300 | 4,545,528 | ||||||
Invitrogen Corp.* | 50,530 | 3,726,587 | ||||||
Pharmaceutical Product Development, Inc. | 106,000 | 4,056,620 | ||||||
Techne Corp.* | 38,600 | 2,208,306 | ||||||
Varian, Inc.* | 31,100 | 1,705,213 | ||||||
21,691,432 | ||||||||
Machinery (4.1%) | ||||||||
AGCO Corp.* | 93,100 | 4,041,471 | ||||||
Crane Co. | 49,000 | 2,227,050 | ||||||
Donaldson Co., Inc. (a) | 68,000 | 2,417,400 | ||||||
Federal Signal Corp. (a) | 44,600 | 707,356 | ||||||
Flowserve Corp. | 58,000 | 4,152,800 | ||||||
Graco, Inc. (a) | 73,150 | 2,946,482 | ||||||
Harsco Corp. | 85,400 | 4,440,800 | ||||||
Joy Global, Inc. | 113,600 | 6,626,288 | ||||||
Kennametal, Inc. | 42,400 | 3,478,072 | ||||||
Lincoln Electric Holdings, Inc. | 43,500 | 3,229,440 | ||||||
Nordson Corp. (a) | 33,800 | 1,695,408 | ||||||
Oshkosh Truck Corp. | 78,600 | 4,945,512 | ||||||
Pentair, Inc. | 105,800 | 4,080,706 | ||||||
SPX Corp. | 60,910 | 5,348,507 | ||||||
Timken Co. (The) | 94,500 | 3,412,395 | ||||||
Trinity Industries, Inc. (a) | 81,500 | 3,548,510 | ||||||
57,298,197 | ||||||||
NVIT Mid Cap Index Fund (Continued)
Common Stock (continued) | ||||||||
Shares or | ||||||||
Principal Amount | Value | |||||||
Manufacturing (0.6%) | ||||||||
Carpenter Technology Corp. | 27,590 | $ | 3,595,253 | |||||
Hanesbrands, Inc.* | 97,500 | 2,635,425 | ||||||
HNI Corp. (a) | 48,700 | 1,996,700 | ||||||
8,227,378 | ||||||||
Marine (0.2%)(a) | ||||||||
Alexander & Baldwin, Inc. | 41,700 | 2,214,687 | ||||||
Media (1.2%) | ||||||||
Belo Corp., Class A | 98,500 | 2,028,115 | ||||||
Catalina Marketing Corp. | 39,400 | 1,241,100 | ||||||
Entercom Communications Corp. (a) | 35,400 | 881,106 | ||||||
Harte-Hanks, Inc. (a) | 52,250 | 1,341,780 | ||||||
John Wiley & Sons, Inc. | 43,400 | 2,095,786 | ||||||
Lee Enterprises, Inc. | 43,400 | 905,324 | ||||||
Media General, Inc. (a) | 26,800 | 891,636 | ||||||
Scholastic Corp.* (a) | 30,800 | 1,106,952 | ||||||
Valassis Communications, Inc.* (a) | 45,000 | 773,550 | ||||||
Washington Post Co. | 5,670 | 4,400,430 | ||||||
Westwood One, Inc. (a) | 60,500 | 434,995 | ||||||
16,100,774 | ||||||||
Metals & Mining (1.3%) | ||||||||
Arch Coal, Inc. (a) | 145,900 | 5,077,320 | ||||||
Commercial Metals Co. | 120,800 | 4,079,416 | ||||||
Reliance Steel & Aluminum Co. (a) | 66,200 | 3,724,412 | ||||||
Steel Dynamics, Inc. | 92,500 | 3,876,675 | ||||||
Worthington Industries, Inc. | 71,200 | 1,541,480 | ||||||
18,299,303 | ||||||||
Multi-Utilities (3.0%) | ||||||||
Alliant Energy Corp. | 120,300 | 4,673,655 | ||||||
Aquila, Inc.* | 357,400 | 1,461,766 | ||||||
Black Hills Corp. (a) | 43,100 | 1,713,225 | ||||||
Energy East Corp. (a) | 159,590 | 4,163,703 | ||||||
MDU Resources Group, Inc. (a) | 184,950 | 5,185,998 | ||||||
Nstar | 107,200 | 3,478,640 | ||||||
Oklahoma Gas & Electric Co. | 100,300 | 3,675,995 | ||||||
PNM, Inc. | 82,450 | 2,291,286 | ||||||
Puget Energy, Inc. | 115,900 | 2,802,462 | ||||||
Scana Corp. | 120,200 | 4,602,458 | ||||||
Vectren Corp. (a) | 74,500 | 2,006,285 | ||||||
Wisconsin Energy Corp. | 125,600 | 5,555,288 | ||||||
41,610,761 | ||||||||
Multiline Retail (0.6%) | ||||||||
99 Cents Only Stores* | 46,900 | 614,859 | ||||||
Dollar Tree Stores, Inc.* | 109,650 | 4,775,258 | ||||||
Saks, Inc. | 153,200 | 3,270,820 | ||||||
8,660,937 | ||||||||
Office Electronics (0.2%) (a) | ||||||||
Zebra Technologies Corp., Class A* | 70,200 | 2,719,548 | ||||||
Oil, Gas & Consumable Fuels (5.8%) | ||||||||
Cimarex Energy Co. | 86,690 | 3,416,453 | ||||||
Denbury Resources, Inc.* | 122,600 | 4,597,500 | ||||||
Encore Acquisition Co.* (a) | 60,050 | 1,669,390 | ||||||
Equitable Resources, Inc. | 127,200 | 6,304,032 | ||||||
Forest Oil Corp.* (a) | 82,470 | 3,485,182 | ||||||
Frontier Oil Corp. | 117,400 | 5,138,598 | ||||||
Newfield Exploration Co.* | 139,000 | 6,331,450 | ||||||
Noble Energy, Inc. | 178,730 | 11,150,965 | ||||||
Overseas Shipholding Group, Inc. (a) | 27,430 | 2,232,802 | ||||||
Patterson-UTI Energy, Inc. | 165,500 | 4,337,755 | ||||||
Pioneer Natural Resources Co. | 129,100 | 6,288,461 | ||||||
Plains Exploration & Production Co.* | 72,380 | 3,460,488 | ||||||
Pogo Producing Co. (a) | 59,200 | 3,006,768 | ||||||
Pride International, Inc.* | 172,800 | 6,473,088 | ||||||
Quicksilver Resources, Inc.* (a) | 57,100 | 2,545,518 | ||||||
Southwestern Energy Co.* | 176,000 | 7,832,000 | ||||||
Superior Energy Services, Inc.* | 87,470 | 3,491,802 | ||||||
81,762,252 | ||||||||
Paper & Forest Products (0.3%) (a) | ||||||||
Bowater, Inc. | 62,400 | 1,556,880 | ||||||
Louisiana-Pacific Corp. | 115,410 | 2,183,557 | ||||||
3,740,437 | ||||||||
Personal Products (0.3%) | ||||||||
Alberto-Culver Co. | 90,770 | 2,153,064 | ||||||
NBTY, Inc.* | 61,050 | 2,637,360 | ||||||
4,790,424 | ||||||||
Pharmaceuticals (1.4%) | ||||||||
Endo Pharmaceuticals Holdings, Inc.* | 142,560 | 4,879,829 | ||||||
Medicis Pharmaceutical Corp. (a) | 61,100 | 1,865,994 | ||||||
Millennium Pharmaceuticals, Inc.* | 327,087 | 3,457,309 | ||||||
Par Pharmaceutical Cos., Inc.* (a) | 38,200 | 1,078,386 | ||||||
Perrigo Co. (a) | 77,800 | 1,523,324 |
Common Stock (continued) | ||||||||
Shares or | ||||||||
Principal Amount | Value | |||||||
Pharmaceuticals (continued) | ||||||||
Sepracor, Inc.* | 111,200 | $ | 4,561,424 | |||||
Valeant Pharmaceuticals International | 96,800 | 1,615,592 | ||||||
18,981,858 | ||||||||
Real Estate Investment Trusts (REITs) (3.4%) | ||||||||
AMB Property Corp. | 104,170 | 5,543,927 | ||||||
Cousins Properties, Inc. (a) | 45,630 | 1,323,726 | ||||||
Equity One, Inc. (a) | 38,340 | 979,587 | ||||||
Highwood Properties, Inc. | 58,500 | 2,193,750 | ||||||
Hospitality Properties Trust | 99,240 | 4,117,468 | ||||||
Liberty Property Trust (a) | 92,800 | 4,076,704 | ||||||
Macerich Co. (The) | 76,700 | 6,321,614 | ||||||
Mack-Cali Realty Corp. | 70,010 | 3,044,735 | ||||||
Nationwide Health Properties, Inc. | 98,720 | 2,685,184 | ||||||
Potlatch Corp. (a) | 39,898 | 1,717,609 | ||||||
Rayonier, Inc. | 84,377 | 3,808,778 | ||||||
Regency Centers Corp. | 70,500 | 4,970,250 | ||||||
UDR, Inc. (a) | 147,700 | 3,884,510 | ||||||
Weingharten Realty Investors(a) | 81,400 | 3,345,540 | ||||||
48,013,382 | ||||||||
Road & Rail (0.5%) | ||||||||
Con-way, Inc. | 48,700 | 2,446,688 | ||||||
J.B. Hunt Transport Services, Inc. | 109,600 | 3,213,472 | ||||||
Werner Enterprises, Inc. (a) | 51,650 | 1,040,748 | ||||||
6,700,908 | ||||||||
Semiconductors & Semiconductor Equipment (3.1%) | ||||||||
Atmel Corp.* | 432,900 | 2,406,924 | ||||||
Cree, Inc.* (a) | 91,300 | 2,360,105 | ||||||
Cypress Semiconductor Corp.* (a) | 154,180 | 3,590,852 | ||||||
Fairchild Semiconductor International, Inc.* | 124,300 | 2,401,476 | ||||||
Integrated Device Technology, Inc.* | 208,630 | 3,185,780 | ||||||
International Rectifier Corp.* | 74,300 | 2,768,418 | ||||||
Intersil Corp. | 145,300 | 4,571,138 | ||||||
Lam Research Corp.* | 143,260 | 7,363,564 | ||||||
Lattice Semiconductor Corp.* (a) | 106,100 | 606,892 | ||||||
Micrel, Inc. (a) | 60,800 | 773,376 | ||||||
Microchip Technology, Inc. | 229,900 | 8,515,496 | ||||||
RF Micro Devices, Inc.* (a) | 214,100 | 1,335,984 | ||||||
Semtech Corp.* (a) | 80,700 | 1,398,531 | ||||||
Silicon Laboratories, Inc.* | 59,900 | 2,073,139 | ||||||
TriQuint Semiconductor, Inc.* | 129,991 | 657,755 | ||||||
44,009,430 | ||||||||
Software (2.6%) | ||||||||
Activision, Inc.* | 268,500 | 5,012,895 | ||||||
Advent Software, Inc.* (a) | 18,100 | 589,155 | ||||||
Cadence Design Systems, Inc.* | 296,400 | 6,508,944 | ||||||
Fair Issac Corp. (a) | 59,420 | 2,383,930 | ||||||
Henry (Jack) & Associates, Inc. (a) | 77,000 | 1,982,750 | ||||||
Macrovision Corp.* | 55,400 | 1,665,324 | ||||||
McAfee, Inc.* | 167,000 | 5,878,400 | ||||||
Mentor Graphics Corp.* (a) | 81,400 | 1,072,038 | ||||||
Parametric Technology Corp.* | 124,490 | 2,690,229 | ||||||
Sybase, Inc.* | 100,000 | 2,389,000 | ||||||
Synopsys, Inc.* | 146,500 | 3,871,995 | ||||||
Transaction Systems Architects, Inc.* (a) | 41,600 | 1,400,256 | ||||||
Wind River Systems, Inc.* (a) | 74,000 | 814,000 | ||||||
36,258,916 | ||||||||
Specialty Retail (4.8%) | ||||||||
Advance Auto Parts, Inc. | 114,250 | 4,630,553 | ||||||
Aeropostale, Inc.* | 55,900 | 2,329,912 | ||||||
American Eagle Outfitters Ltd. | 202,500 | 5,196,150 | ||||||
AnnTaylor Stores Corp.* | 70,520 | 2,497,818 | ||||||
Barnes & Noble, Inc. | 56,700 | 2,181,249 | ||||||
Borders Group, Inc. (a) | 66,100 | 1,259,866 | ||||||
Carmax, Inc.* | 224,800 | 5,732,400 | ||||||
Charming Shoppes* (a) | 133,700 | 1,447,971 | ||||||
Chico’s FAS, Inc.* | 180,900 | 4,403,106 | ||||||
Dick’s Sporting Goods, Inc.* | 39,720 | 2,310,512 | ||||||
Foot Locker, Inc. | 166,500 | 3,629,700 | ||||||
Gamestop Corp.* | 159,600 | 6,240,360 | ||||||
O’Reilly Automotive, Inc.* (a) | 115,900 | 4,236,145 | ||||||
Pacific Sunwear of California, Inc.* (a) | 77,200 | 1,698,400 | ||||||
Payless ShoeSource, Inc.* | 71,800 | 2,265,290 | ||||||
PETsMART, Inc. | 138,700 | 4,500,815 | ||||||
Rent-A-Center, Inc.* (a) | 75,900 | 1,990,857 | ||||||
Ross Stores, Inc. | 149,900 | 4,616,920 | ||||||
Urban Outfitters, Inc.* | 114,200 | 2,744,226 | ||||||
Williams Sonoma, Inc. (a) | 119,200 | 3,764,336 | ||||||
67,676,586 | ||||||||
Textiles, Apparel & Luxury Goods (0.3%) | ||||||||
Phillips-Van Heusen Corp. | 58,300 | 3,531,231 | ||||||
Timberland Co., Class A* | 51,300 | 1,292,247 | ||||||
4,823,478 | ||||||||
NVIT Mid Cap Index Fund (Continued)
Common Stock (continued) | ||||||||
Shares or | ||||||||
Principal Amount | Value | |||||||
Thrifts & Mortgage Finance (1.7%) | ||||||||
Astoria Financial Corp. | 82,050 | $ | 2,054,532 | |||||
First Niagara Financial Group, Inc. (a) | 115,000 | 1,506,500 | ||||||
IndyMac Bancorp, Inc. (a) | 78,300 | 2,284,011 | ||||||
New York Community Bancorp, Inc. (a) | 297,128 | 5,057,118 | ||||||
PMI Group, Inc. | 94,100 | 4,203,447 | ||||||
Radian Group, Inc. (a) | 81,300 | 4,390,200 | ||||||
Washington Federal, Inc. (a) | 85,189 | 2,070,945 | ||||||
Webster Financial Corp. | 55,800 | 2,380,986 | ||||||
23,947,739 | ||||||||
Tobacco (0.1%) (a) | ||||||||
Universal Corp. | 29,100 | 1,772,772 | ||||||
Trading Companies & Distributors (0.9%) | ||||||||
Fastenal Co. | 131,200 | 5,492,032 | ||||||
GATX Corp. | 53,300 | 2,625,025 | ||||||
MSC Industrial Direct Co., Class A | 53,700 | 2,953,500 | ||||||
United Rentals, Inc.* (a) | 67,200 | 2,186,688 | ||||||
13,257,245 | ||||||||
Transportation (0.2%) (a) | ||||||||
YRC Worldwide, Inc.* | 63,000 | 2,318,400 | ||||||
Water Utility (0.2%) (a) | ||||||||
Aqua America, Inc. | 145,300 | 3,267,797 | ||||||
Wireless Telecommunication Services (0.5%) | ||||||||
Telephone & Data Systems, Inc. | 91,900 | 5,750,183 | ||||||
Telephone & Data Systems, Inc., Special Shares | 17,000 | 978,350 | ||||||
6,728,533 | ||||||||
Total Common Stocks (Cost $1,064,544,211) | 1,255,825,807 | |||||||
Repurchase Agreements (11.9%) | ||||||||
Nomura Securities, 5.20%, dated 06/29/07, due 07/02/07, repurchase price $166,257,916, collateralized by U.S. Government Agency Mortgages with a market value of $169,509,620 | $ | 166,185,902 | 166,185,902 | |||||
Securities held as Collateral for Securities on Loan (12.8%) | ||||||||
Morgan Stanley Repurchase Agreement, 5.42%, dated 06/29/07, due 07/02/07, repurchase price $178,451,288, collateralized by U.S. Government Agency Mortgages with a market value of $181,938,138 | 178,370,724 | 178,370,724 | ||||||
Total Investments (Cost $1,409,100,836) (b) — 114.4% | 1,600,382,433 | |||||||
Liabilities in excess of other assets — (14.4)% | (201,004,324 | ) | ||||||
NET ASSETS — 100.0% | $ | 1,399,378,109 | ||||||
* | Denotes a non-income producing security. | |
(a) | All or a part of the security was on loan as of June 30, 2007. | |
(b) | See notes to financial statements for tax unrealized appreciation (depreciation) of securities. |
At June 30, 2007, the Fund’s open futures contracts were as follows:
Market Value | Unrealized | |||||||||||||||
Number of | Long | Covered by | Appreciation | |||||||||||||
Contracts | Contracts | Expiration | Contracts | (Depreciation) | ||||||||||||
311 | S&P 400 Mid Cap Future | 09/20/07 | $ | 140,603,100 | $ | (1,931,281 | ) | |||||||||
$ | 140,603,100 | $ | (1,931,281 | ) | ||||||||||||
See accompanying notes to financial statements.
NVIT Mid Cap | ||||||
Index Fund | ||||||
Assets: | ||||||
Investments, at value (cost $1,064,544,211)* | $ | 1,255,825,807 | ||||
Repurchase agreements, at cost and value | 344,556,626 | |||||
Total Investments | 1,600,382,433 | |||||
Interest and dividends receivable | 1,416,474 | |||||
Receivable for capital shares issued | 979,361 | |||||
Receivable for investments sold | 4,765,648 | |||||
Receivable for variation margin on futures contracts | 27,575 | |||||
Prepaid expenses | 9,159 | |||||
Total Assets | 1,607,580,650 | |||||
Liabilities: | ||||||
Payable to custodian | 330,336 | |||||
Payable for investments purchased | 28,731,175 | |||||
Payable upon return of securities loaned | 178,370,724 | |||||
Payable for capital shares redeemed | 341,854 | |||||
Accrued expenses and other payables: | ||||||
Investment advisory fees | 255,812 | |||||
Fund administration and transfer agent fees | 87,565 | |||||
Distribution fees | 4,851 | |||||
Administrative servicing fees | 52,285 | |||||
Compliance program costs | 10,240 | |||||
Other | 17,699 | |||||
Total Liabilities | 208,202,541 | |||||
Net Assets | $ | 1,399,378,109 | ||||
Represented by: | ||||||
Capital | $ | 1,182,404,922 | ||||
Accumulated net investment income | 383,320 | |||||
Accumulated net realized gains from investment transactions and futures | 27,239,552 | |||||
Net unrealized appreciation on investments and futures | 189,350,315 | |||||
Net Assets | $ | 1,399,378,109 | ||||
Net Assets: | ||||||
Class I Shares | $ | 550,725,003 | ||||
Class II Shares | 23,338,932 | |||||
Class ID Shares | 825,314,174 | |||||
Total | $ | 1,399,378,109 | ||||
Shares outstanding (unlimited number of shares authorized): | ||||||
Class I Shares | 27,474,608 | |||||
Class II Shares | 1,168,570 | |||||
Class ID Shares | 41,173,726 | |||||
Total | 69,816,904 | |||||
Net asset value and offering price per share (Net assets by class divided by shares outstanding by class, respectively.): | ||||||
Class I Shares | $ | 20.04 | ||||
Class II Shares | $ | 19.97 | ||||
Class ID Shares | $ | 20.04 | ||||
* | Includes value of securities on loan of $174,561,188. |
13
NVIT Mid Cap | |||||
Index Fund | |||||
INVESTMENT INCOME: | |||||
Interest income | $ | 3,246,479 | |||
Dividend income | 6,955,726 | ||||
Income from securities lending | 180,053 | ||||
Total Income | 10,382,258 | ||||
Expenses: | |||||
Investment advisory fees | 1,112,918 | ||||
Fund administration and transfer agent fees | 308,194 | ||||
Distribution fees Class II Shares | 28,085 | ||||
Administrative servicing fees Class I Shares | 401,794 | ||||
Administrative servicing fees Class II Shares | 14,287 | ||||
Custodian fees | 16,119 | ||||
Trustee fees | 18,334 | ||||
Compliance program costs (Note 3) | 5,916 | ||||
Other | 76,868 | ||||
Total expenses before earnings credit | 1,982,515 | ||||
Earnings credit (Note 6) | (863 | ) | |||
Net Expenses | 1,981,652 | ||||
Net Investment Income | 8,400,606 | ||||
REALIZED/ UNREALIZED GAINS (LOSSES) FROM INVESTMENTS: | |||||
Net realized gains on investment transactions | 27,646,404 | ||||
Net realized gains on futures transactions | 10,412,570 | ||||
Net realized gains on investment transactions and futures | 38,058,974 | ||||
Net change in unrealized appreciation on investments and futures | 57,737,542 | ||||
Net realized/unrealized gains (losses) on investments and futures | 95,796,516 | ||||
CHANGE IN NET ASSETS RESULTING FROM OPERATIONS | $ | 104,197,122 | |||
14
NVIT Mid Cap Index Fund | |||||||||
Six Months Ended | Year Ended | ||||||||
June 30, 2007 | December 31, 2006 | ||||||||
(Unaudited) | |||||||||
FROM INVESTMENT ACTIVITIES: | |||||||||
Operations: | |||||||||
Net investment income | $ | 8,400,606 | $ | 7,664,189 | |||||
Net realized gains on investment transactions and futures | 38,058,974 | 40,381,779 | |||||||
Net change in unrealized appreciation on investments and futures | 57,737,542 | 15,570,091 | |||||||
Change in net assets resulting from operations | 104,197,122 | 63,616,059 | |||||||
Distributions to shareholders from: | |||||||||
Net investment income: | |||||||||
Class I | (4,380,511 | ) | (6,407,875 | ) | |||||
Class II | (155,958 | ) | (215,877 | ) | |||||
Class ID | (3,534,131 | ) | (987,123 | )(a) | |||||
Net realized gains: | |||||||||
Class I | (15,211,569 | ) | (7,900,961 | ) | |||||
Class II | (645,494 | ) | (314,967 | ) | |||||
Class ID | (22,577,560 | ) | (431,978 | )(a) | |||||
Change in net assets from shareholder distributions | (46,505,223 | ) | (16,258,781 | ) | |||||
Change in net assets from capital transactions | 618,979,910 | 77,498,024 | |||||||
Change in net assets | 676,671,809 | 124,855,302 | |||||||
Net Assets: | |||||||||
Beginning of period | 722,706,300 | 597,850,998 | |||||||
End of period | $ | 1,399,378,109 | $ | 722,706,300 | |||||
Accumulated net investment income at end of period | $ | 383,320 | $ | 53,314 | |||||
CAPITAL TRANSACTIONS: | |||||||||
Class I Shares | |||||||||
Proceeds from shares issued | $ | 18,275,074 | $ | 60,983,299 | |||||
Dividends reinvested | 19,592,038 | 14,308,811 | |||||||
Cost of shares redeemed(b) | (77,373,594 | ) | (141,961,434 | ) | |||||
(39,506,482 | ) | (66,669,324 | ) | ||||||
Class II Shares | |||||||||
Proceeds from shares issued | 2,228,240 | 7,833,326 | |||||||
Dividends reinvested | 801,450 | 530,844 | |||||||
Cost of shares redeemed(b) | (2,872,633 | ) | (9,757,506 | ) | |||||
157,057 | (1,393,336 | ) | |||||||
15
NVIT Mid Cap Index Fund | |||||||||
Six Months Ended | Year Ended | ||||||||
June 30, 2007 | December 31, 2006 | ||||||||
(Unaudited) | |||||||||
CAPITAL TRANSACTIONS: (continued) | |||||||||
Class ID Shares | |||||||||
Proceeds from shares issued | $ | 28,016,144 | $ | 144,141,583 | (a) | ||||
Proceeds from in-kind transactions | 609,836,722 | – | |||||||
Dividends reinvested | 26,111,629 | 1,419,101 | (a) | ||||||
Cost of shares redeemed(b) | (5,635,160 | ) | – | ||||||
658,329,335 | 145,560,684 | ||||||||
Change in net assets from capital transactions | $ | 618,979,910 | $ | 77,498,024 | |||||
SHARE TRANSACTIONS: | |||||||||
Class I Shares | |||||||||
Issued | 921,648 | 3,343,669 | |||||||
Reinvested | 985,109 | 816,554 | |||||||
Redeemed | (3,907,257 | ) | (7,882,260 | ) | |||||
(2,000,500 | ) | (3,722,037 | ) | ||||||
Class II Shares | |||||||||
Issued | 111,893 | 429,627 | |||||||
Reinvested | 40,432 | 30,439 | |||||||
Redeemed | (145,300 | ) | (541,778 | ) | |||||
7,025 | (81,712 | ) | |||||||
Class ID Shares | |||||||||
Issued | 1,421,069 | 8,160,118 | (a) | ||||||
Proceeds from in-kind transactions | 30,476,598 | – | |||||||
Reinvested | 1,311,354 | 79,724 | (a) | ||||||
Redeemed | (275,137 | ) | – | ||||||
32,933,884 | 8,239,842 | ||||||||
Total change in shares | 30,940,409 | 4,436,093 | |||||||
(a) | For the period from May 1, 2006 (commencement of operations) through December 31, 2006. | |
(b) | Includes redemption fees, if any. |
16
Distributions | ||||||||||||||||||||
Investment Activities | ||||||||||||||||||||
Net Realized | ||||||||||||||||||||
and | ||||||||||||||||||||
Net Asset | Unrealized | Total | ||||||||||||||||||
Value, | Net | Gains | from | Net | ||||||||||||||||
Beginning | Investment | (Losses) on | Investment | Investment | ||||||||||||||||
of Period | Income | Investments | Activities | Income | ||||||||||||||||
Class I Shares | ||||||||||||||||||||
For the year ended December 31, 2002 | $ | 13.17 | 0.04 | (2.05 | ) | (2.01 | ) | (0.04 | ) | |||||||||||
For the year ended December 31, 2003 | $ | 11.02 | 0.06 | 3.75 | 3.81 | (0.06 | ) | |||||||||||||
For the year ended December 31, 2004 | $ | 14.77 | 0.09 | 2.23 | 2.32 | (0.08 | ) | |||||||||||||
For the year ended December 31, 2005 | $ | 16.61 | 0.16 | 1.82 | 1.98 | (0.18 | ) | |||||||||||||
For the year ended December 31, 2006 | $ | 17.36 | 0.21 | 1.48 | 1.69 | (0.21 | ) | |||||||||||||
For the six months ended June 30, 2007 (Unaudited) | $ | 18.59 | 0.17 | 2.01 | 2.18 | (0.16 | ) | |||||||||||||
Class II Shares | ||||||||||||||||||||
Period ended December 31, 2002 (e) | $ | 13.64 | 0.02 | (2.53 | ) | (2.51 | ) | (0.03 | ) | |||||||||||
For the year ended December 31, 2003 | $ | 11.00 | 0.03 | 3.74 | 3.77 | (0.04 | ) | |||||||||||||
For the year ended December 31, 2004 | $ | 14.73 | 0.07 | 2.22 | 2.29 | (0.06 | ) | |||||||||||||
For the year ended December 31, 2005 | $ | 16.56 | 0.13 | 1.81 | 1.94 | (0.15 | ) | |||||||||||||
For the year ended December 31, 2006 | $ | 17.30 | 0.19 | 1.47 | 1.66 | (0.18 | ) | |||||||||||||
For the six months ended June 30, 2007 (Unaudited) | $ | 18.53 | 0.15 | 2.00 | 2.15 | (0.14 | ) | |||||||||||||
Class ID Shares | ||||||||||||||||||||
Period ended December 31, 2006 (h) | $ | 18.88 | 0.16 | (0.01 | ) | 0.15 | (0.19 | ) | ||||||||||||
For the six months ended June 30, 2007 (Unaudited) | $ | 18.59 | 0.17 | 2.02 | 2.19 | (0.17 | ) | |||||||||||||
[Additional columns below]
[Continued from above table, first column(s) repeated]
Distributions | Ratios/Supplemental Data | |||||||||||||||||||||||||||||||||||||||||||
Net | Net Assets | Ratio of | ||||||||||||||||||||||||||||||||||||||||||
Realized | Net Asset | at End of | Expenses | |||||||||||||||||||||||||||||||||||||||||
Gains | Total | Value, End | Total | Period | to Average | |||||||||||||||||||||||||||||||||||||||
(Losses) | Distributions | of Period | Return (a) | (000s) | Net Assets (b) | |||||||||||||||||||||||||||||||||||||||
Class I Shares | ||||||||||||||||||||||||||||||||||||||||||||
For the year ended December 31, 2002 | (0.10 | ) | (0.14 | ) | $ | 11.02 | (15.30% | ) | $ | 285,970 | 0.74% | |||||||||||||||||||||||||||||||||
For the year ended December 31, 2003 | –(f | ) | (0.06 | ) | $ | 14.77 | 34.65% | $ | 432,589 | 0.74% | ||||||||||||||||||||||||||||||||||
For the year ended December 31, 2004 | (0.40 | ) | (0.48 | ) | $ | 16.61 | 15.73% | $ | 532,474 | 0.60% | ||||||||||||||||||||||||||||||||||
For the year ended December 31, 2005 | (1.05 | ) | (1.23 | ) | $ | 17.36 | 12.10% | $ | 576,339 | 0.55% | ||||||||||||||||||||||||||||||||||
For the year ended December 31, 2006 | (0.25 | ) | (0.46 | ) | $ | 18.59 | 9.89% | $ | 548,012 | 0.50% | ||||||||||||||||||||||||||||||||||
For the six months ended June 30, 2007 (Unaudited) | (0.57 | ) | (0.73 | ) | $ | 20.04 | 11.76% | $ | 550,725 | 0.45% | ||||||||||||||||||||||||||||||||||
Class II Shares | ||||||||||||||||||||||||||||||||||||||||||||
Period ended December 31, 2002 (e) | (0.10 | ) | (0.13 | ) | $ | 11.00 | (18.44% | ) | $ | 1,232 | 0.96% | |||||||||||||||||||||||||||||||||
For the year ended December 31, 2003 | –(f | ) | (0.04 | ) | $ | 14.73 | 34.30% | $ | 8,049 | 0.98% | ||||||||||||||||||||||||||||||||||
For the year ended December 31, 2004 | (0.40 | ) | (0.46 | ) | $ | 16.56 | 15.50% | $ | 15,367 | 0.78% | ||||||||||||||||||||||||||||||||||
For the year ended December 31, 2005 | (1.05 | ) | (1.20 | ) | $ | 17.30 | 11.90% | $ | 21,512 | 0.72% | ||||||||||||||||||||||||||||||||||
For the year ended December 31, 2006 | (0.25 | ) | (0.43 | ) | $ | 18.53 | 9.74% | $ | 21,522 | 0.66% | ||||||||||||||||||||||||||||||||||
For the six months ended June 30, 2007 (Unaudited) | (0.57 | ) | (0.71 | ) | $ | 19.97 | 11.62% | $ | 23,339 | 0.68% | ||||||||||||||||||||||||||||||||||
Class ID Shares | ||||||||||||||||||||||||||||||||||||||||||||
Period ended December 31, 2006 (h) | (0.25 | ) | (0.44 | ) | $ | 18.59 | 0.94% | $ | 153,172 | 0.31% | ||||||||||||||||||||||||||||||||||
For the six months ended June 30, 2007 (Unaudited) | (0.57 | ) | (0.74 | ) | $ | 20.04 | 11.84% | $ | 825,314 | 0.30% | ||||||||||||||||||||||||||||||||||
[Additional columns below]
[Continued from above table, first column(s) repeated]
Ratios/Supplemental Data | ||||||||||||||||||
Ratio of Net | ||||||||||||||||||
Ratio of | Ratio of | Investment | ||||||||||||||||
Net | Expenses | Income | ||||||||||||||||
Investment | (Prior to | (Prior to | ||||||||||||||||
Income to | Reimbursements) | Reimbursements) | ||||||||||||||||
Average Net | to Average | to Average | Portfolio | |||||||||||||||
Assets (b) | Net Assets (b)(c) | Net Assets (b)(c) | Turnover (d) | |||||||||||||||
Class I Shares | ||||||||||||||||||
For the year ended December 31, 2002 | 0.37% | 0.75% | 0.36% | 27.32% | ||||||||||||||
For the year ended December 31, 2003 | 0.49% | (g) | (g) | 11.58% | ||||||||||||||
For the year ended December 31, 2004 | 0.62% | (g) | (g) | 15.90% | ||||||||||||||
For the year ended December 31, 2005 | 0.93% | (g) | (g) | 19.32% | ||||||||||||||
For the year ended December 31, 2006 | 1.17% | (g) | (g) | 13.76% | ||||||||||||||
For the six months ended June 30, 2007 (Unaudited) | 1.72% | 0.45% | 1.72% | 9.25% | ||||||||||||||
Class II Shares | ||||||||||||||||||
Period ended December 31, 2002 (e) | 0.25% | (g) | (g) | 27.32% | ||||||||||||||
For the year ended December 31, 2003 | 0.27% | (g) | (g) | 11.58% | ||||||||||||||
For the year ended December 31, 2004 | 0.45% | (g) | (g) | 15.90% | ||||||||||||||
For the year ended December 31, 2005 | 0.76% | (g) | (g) | 19.32% | ||||||||||||||
For the year ended December 31, 2006 | 1.01% | (g) | (g) | 13.76% | ||||||||||||||
For the six months ended June 30, 2007 (Unaudited) | 1.48% | 0.68% | 1.48% | 9.25% | ||||||||||||||
Class ID Shares | ||||||||||||||||||
Period ended December 31, 2006 (h) | 1.38% | (g) | (g) | 13.76% | ||||||||||||||
For the six months ended June 30, 2007 (Unaudited) | 1.60% | 0.30% | 1.60% | 9.25% | ||||||||||||||
(a) | Not annualized for periods less than one year. | |
(b) | Annualized for periods less than one year. | |
(c) | During the period, certain fees were waived and/or reimbursed. If such waivers/reimbursements had not occurred, the ratios would have been as indicated. | |
(d) | Portfolio turnover is calculated on the basis of the Fund as a whole without distinguishing among the classes of shares. | |
(e) | For the period from May 6, 2002 (commencement of operations) through December 31, 2002. | |
(f) | The amount is less than $0.005. | |
(g) | There were no fee waivers/reimbursements during the period. | |
(h) | For the period from May 1, 2006 (commencement of operations) through December 31, 2006. |
See accompanying notes to financial statements.
1. Organization
Nationwide Variable Insurance Trust (“NVIT” or the “Trust”) is an open-end management investment company, organized under the laws of Delaware by an amended and restated Agreement and Declaration of Trust, dated October 28, 2004, as amended to date. Prior to May 1, 2007, the Trust was named “Gartmore Variable Insurance Trust”. The Trust, originally created under the laws of Massachusetts as a Massachusetts business trust pursuant to a Declaration of Trust dated, as of June 30, 1981, and as subsequently amended, redomesticated as a Delaware Statutory Trust after the close of trading on April 29, 2005, and is registered under the Investment Company Act of 1940, as amended (the “1940 Act”). The redomestication was a change in statutory status and did not affect the operations of the Trust. As of June 30, 2007, the Trust had authorized an unlimited number of shares of beneficial interest, without par value (“shares”). The Trust currently offers shares to life insurance company separate accounts to fund the benefits under variable life insurance or annuity policies. To date, only the separate accounts of Nationwide Life Insurance Company and Nationwide Life and Annuity Insurance Company (collectively, “Nationwide”), Great West Life & Annuity Insurance Company and First Great West Life & Annuity Insurance Company have purchased shares of the NVIT Mid Cap Index Fund (the “Fund”), (formerly “GVIT Mid Cap Index Fund”). The Trust currently operates forty (40) separate series, or mutual funds, each with its own investment objectives and strategies. This report contains the financial statements and financial highlights of the Fund.
2. Summary of Significant Accounting Policies
The following is a summary of significant accounting policies followed by the Fund in the preparation of its financial statements. The policies are in conformity with accounting principles generally accepted in the United States of America (“GAAP”). The preparation of financial statements requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of income and expenses for the period. Actual results could differ from those estimates.
(a) | Security Valuation |
Securities for which market quotations are readily available are valued at current market value as of “Valuation Time.” Valuation Time is as of the close of regular trading on the New York Stock Exchange (usually 4 p.m. Eastern time). Equity securities are valued at the last quoted sale price or, if there is no sale price, the last quoted bid price provided by an independent pricing service approved by the Trust’s Board of Trustees (“Board of Trustees”). Securities traded on NASDAQ are valued at the NASDAQ official closing price. Prices are taken from the primary market or exchange in which each security trades. | |
Most securities listed on a foreign exchange are valued either at fair value (see description below) or at the last sale price at the close of the exchange on which the security is principally traded. Foreign securities, currencies, and other assets and liabilities denominated in foreign currencies are translated into U.S. dollars at the exchange rate of said currencies against the U.S. dollar, as of Valuation Time, as provided by an independent pricing service approved by the Board of Trustees. | |
Debt (including defaulted issues) and other fixed income securities (other than short-term obligations) are valued at the last quoted bid price and/or by using a combination of daily quotes and matrix evaluations provided by an independent pricing service, the use of which has been approved by the Board of Trustees. Short-term debt securities, such as commercial paper and U.S. Treasury Bills having a remaining maturity of 60 days or less at the time of purchase, are considered to be “short-term” and are valued at amortized cost, which approximates market value. | |
Securities for which market quotations are not readily available, or for which an independent pricing service does not provide a value or provides a value that does not represent fair value in the judgment of the Fund’s investment adviser or designee, are valued at fair value under procedures approved by the Board of Trustees. The “Fair Value” of these securities is determined in good faith by taking into account relevant factors and surrounding circumstances. Methods utilized to obtain a “Fair Value” may include the following non-exclusive list of acceptable methods: (i) a |
multiple of earnings; (ii) the discount from market value of a similar, freely traded security; (iii) the yield-to-maturity for debt issues; or (iv) a consolidation of the methods. The Trust’s Valuation & Operations Committee considers a non-exclusive list of factors to arrive at the appropriate method of determining “Fair Value.” For example, fair value determinations are required for securities whose value is affected by a “significant” event that materially affects the value of a domestic or foreign security which occurs subsequent to the time of the close of the principal market on which such domestic or foreign security trades and before the Valuation Time (i.e., a “subsequent event”). Typically, this will involve events occurring after the close of a foreign market on which a security trades and before the next Valuation Time. | |
The Fund values foreign securities at fair value in the circumstances described below. Generally, trading in foreign securities markets is completed each day at various times prior to the Valuation Time. Due to the time differences between the closings of the relevant foreign securities exchanges and the Valuation Time for the Fund, the Fund will fair value its foreign investments when it is determined that the market quotations for the foreign investments either are not readily available or are unreliable and, therefore, do not represent fair value. When the fair value prices are utilized, these prices will attempt to reflect the impact of the U.S. financial markets’ perceptions and trading activities on the Fund’s foreign investments since the last closing prices of the foreign investments were calculated on their primary foreign securities markets or exchanges. For these purposes, the Board of Trustees has determined that movements in relevant indices or other appropriate market indicators, after the close of the foreign securities exchanges, may demonstrate that market quotations are unreliable, and may trigger fair value pricing for certain securities. Consequently, fair valuation of portfolio securities may occur on a daily basis. |
(b) | Repurchase Agreements |
The Fund may enter into repurchase agreements with an entity which is a member of the Federal Reserve System or which is a “primary dealer” (as designated by the Federal Reserve Bank of New York) in U.S. Government obligations. The repurchase price generally equals the price paid by the Fund plus interest negotiated on the basis of current short-term rates, which may be more or less than the rate on the underlying portfolio securities. The seller under a repurchase agreement is required to maintain the value of the collateral held pursuant to the agreement at a market value equal to or greater than the repurchase price (including accrued interest). Collateral subject to repurchase agreements is held by the Fund’s custodian or another qualified sub-custodian or in the Federal Reserve/ Treasury book-entry system. If the counterparty defaults and the fair value of the collateral declines, realization of the collateral by the Fund may be delayed or limited. The Fund may transfer uninvested cash balances into a pooled cash account. These balances are invested in one or more repurchase agreements, with the counterparty of Nomura Securities, which is fully collateralized by U.S. Government Agency Mortgages. |
(c) | Foreign Currency Transactions |
The accounting records of the Fund are maintained in U.S. dollars. Foreign currency amounts are translated into U.S. dollars at the current rate of exchange to determine the value of investments, assets and liabilities. The Fund may enter into foreign currency contracts in connection with purchases or sales of securities denominated in a foreign currency. Purchases and sales of securities, and income and expenses, are translated at the prevailing rate of exchange on the respective date of these transactions. The Fund does not isolate that portion of the results of operations resulting from changes in foreign exchange rates on investments from fluctuations arising from changes in market prices of securities held. These fluctuations are included with the net realized and unrealized gain or loss from investments and foreign currencies. |
(d) | Futures Contracts |
The Fund may invest in financial futures contracts (“futures contracts”) for the purpose of hedging its existing portfolio securities or securities that the Fund intends to purchase against fluctuations in value caused by changes in prevailing market interest rates or prices. Futures contracts may also be entered into for non-hedging purposes. |
Upon entering into a futures contract, the Fund is required to pledge to the broker an amount of cash and/or other assets equal to a certain percentage of the contract amount (initial margin deposit). Subsequent payments, known as “variation margin,” are made each day, depending on the daily fluctuations in the fair value/market value of the underlying assets. A gain or loss equal to the daily variation margin is recognized on a daily basis. Futures contracts are valued daily at their last quoted sale price. | |
A “sale” of a futures contract means the creation of a contractual obligation to deliver the securities or foreign currency called for by the contract at a fixed price at a specified time in the future. A “purchase” of a futures contract means the creation of a contractual obligation to acquire the securities or foreign currency at a fixed price at a specified time in the future. | |
Should market conditions change unexpectedly, the Fund may not achieve the anticipated benefits of the futures contracts and may realize a loss. The use of futures transactions for hedging purposes involves the risk of imperfect correlation in movements in the price of futures contracts, interest rates, and the value of the underlying hedged assets. |
(e) | Written Options Contracts |
The Fund may write options contracts. A written option obligates the Fund to deliver (written call) or to receive (written put) a specified quantity of an underlying asset at the contract amount upon exercise by the holder of the option. When the Fund writes an option, an amount equal to the premium received by the Fund is recorded as a liability and is subsequently adjusted to the current fair value of the option written. Premiums received from writing options that expire unexercised are treated by the Fund on the expiration date as realized gains from investments. The difference between the premium and the amount paid on effecting a closing purchase transaction, as a realized loss. If a call option is exercised, the premium is added to the proceeds from the sale of the underlying security or currency in determining whether the Fund has realized a gain or loss. If a put option is exercised, the premium reduces the cost basis of the securities purchased by the Fund. Options traded on an exchange are valued at the last quoted sale price, or in the absence of a sale, the bid price provided by an independent pricing service approved by the Board of Trustees. Non-exchange traded options are valued using dealer supplied quotes. The Fund as a writer of an option bears the market risk of an unfavorable change in the price of the security underlying the written option. |
(f) | Short Sales |
The Fund is authorized to engage in short-selling of portfolio securities which obligates the Fund to replace any security that the Fund has borrowed by purchasing the security at current market value sometime in the future. The Fund will incur a loss if the price of the security increases between the date of the short sale and the date on which the Fund replaces the borrowed security. The Fund generally will realize a gain if the price of the security declines between these dates. Until the Fund replaces the borrowed security, the Fund will maintain a segregated account with cash, U.S. Government securities and/or securities held long to sufficiently cover the Fund’s short position on a daily basis. Dividends declared on securities sold short are recorded as an expense on the ex-dividend date and paid to the counterparty on the dividend pay date. The collateral for securities sold short includes the deposits with brokers and securities held long as shown in the Statement of Investments for the Fund. |
(g) | Security Transactions and Investment Income |
Security transactions are accounted for on the date the security is purchased or sold (“trade date”). Securities gains and losses are calculated on the identified cost basis. Interest income is recognized on the accrual basis and includes, where applicable, the amortization or accretion of premium or discount. Dividend income is recorded on the ex-dividend date. |
(h) | Securities Lending |
To generate additional income, the Fund may lend its portfolio securities, up to 33 1/3% of the Fund, to brokers, dealers and other financial institutions provided that (1) the borrower delivers cash or securities as collateral with respect to each new loan of U.S. securities, equal to at least 102% of the value of the portfolio securities loaned, and with respect to each new loan on non-U.S. securities, collateral of at least 105% of the value of the portfolio securities loaned; and (2) at all times thereafter shall require the borrower to mark-to-market the collateral on a daily basis so that the market value of such collateral does not fall below 100% of the value of securities loaned. The Fund receives payments from borrowers equivalent to the dividends and interest that would have been earned on securities loaned while simultaneously seeking to earn income on the investment of cash collateral. There may be risks of delay in recovery of the securities should the borrower of the securities fail financially. Loans will be made, however, only to borrowers deemed by the Fund’s investment adviser to be of good standing and creditworthy under guidelines established by the Board of Trustees and when, in judgment of the adviser, the consideration which can be earned currently from these securities loans justifies the attendant risks. Loans are subject to termination by the Fund or the borrower at any time, and, therefore, are not considered to be illiquid investments. JPMorgan Chase Bank serves as custodian for the securities lending program of the Fund. JPMorgan Chase Bank receives a fee based on the value of the collateral received from borrowers. | |
Information on the investment of cash collateral is shown in the Statement of Investments. | |
As of June 30, 2007, the Fund had securities with the following value on loan: |
Value of Loaned Securities | Value of Collateral | |||||||
$ | 174,561,188 | $ | 178,370,724 |
(i) | Distributions to Shareholders |
The Fund’s dividends from net investment income, if any, are declared and paid quarterly. The Fund’s distributions from net realized capital gains, if any, are declared and distributed at least annually. | |
Dividends and distributions to shareholders are determined in accordance with federal income tax regulations, which may differ from GAAP. These “book/tax” differences are considered either permanent or temporary in nature. In accordance with the American Institute of Certified Public Accountants Statement of Position 93-2, permanent differences (i.e., reclassification of market discounts, foreign exchange gain/loss, paydowns, and distributions from real estate investment trusts) are reclassified within the capital accounts based on their nature for federal income tax purposes; temporary differences do not require reclassification. These reclassifications have no effect upon the net asset value of the Fund. Dividends and distributions that exceed net investment income and net realized gains for financial reporting purposes, but not for tax purposes, are reported as distributions in excess of net investment income or net realized gains. To the extent distributions exceed current and accumulated earnings and profits for federal income tax purposes, these distributions are reported as distributions of paid-in-capital. |
(j) | Federal Income Taxes |
It is the policy of the Fund to qualify or to continue to qualify as a “regulated investment company” by complying with the provisions available to certain investment companies, as defined in Subchapter M of the U.S. Internal Revenue Code, and to make distributions of net investment income and net realized capital gains sufficient to relieve the Fund from all, or substantially all, federal income taxes. |
As of June 30, 2007, the tax cost of securities and the breakdown of unrealized appreciation (depreciation) for the Fund was as follows: |
Net | ||||||||||||||||
Unrealized | ||||||||||||||||
Tax Cost of | Unrealized | Unrealized | Appreciation | |||||||||||||
Securities | Appreciation | Depreciation | (Depreciation) | |||||||||||||
$ | 1,420,364,359 | $ | 212,513,697 | $ | (32,495,623 | ) | $ | 180,018,074 |
(k) | Allocation of Expenses, Income, and Gains and Losses |
Expenses directly attributable to the Fund are charged to the Fund. Expenses not directly attributable to the Fund are allocated proportionately among various or all funds within the Trust. The method used by the Fund for allocating income, fund level expenses, and realized and unrealized gains or losses is based on the fair value of shares outstanding relative to net assets. Under this method, each class of shares participates based on the total net asset value of that class’s shares in proportion to the total net assets of the Fund. Expenses specific to a class (such as Rule 12b-1 and administrative services fees) are charged to that class. |
3. Transactions with Affiliates
Under the terms of the Trust’s Investment Advisory Agreement, Nationwide Fund Advisors (formerly, Gartmore Mutual Fund Capital Trust (“GMF”)) (“NFA” or the “Advisor”) manages the investment of the assets and supervises the daily business affairs of the Fund. NFA is a wholly-owned subsidiary of Nationwide Financial Services (“NFS”). In addition, NFA provides investment management evaluation services in initially selecting and monitoring, on an ongoing basis, the performance of BlackRock Investment Management, LLC., the Fund’s subadviser (the “subadviser”). The subadviser manages the Fund’s investments and has responsibility for making all investment decisions for the Fund. Under the terms of the Investment Advisory Agreement, the Fund pays NFA an investment advisory fee based on that Fund’s average daily net assets. Additional information regarding investment advisory fees and subadvisory fees for NFA and the subadviser is as follows for the six months ended June 30, 2007:
Fee Schedule | Total Fees | |||||
$0 up to $1.5 billion | 0.22% | |||||
$1.5 billion up to $3 billion | 0.21% | |||||
$3 billion and more | 0.20% | |||||
From such fees, pursuant to the subadvisory agreement, NFA paid the subadviser $379,405 for the six months ended June 30, 2007.
NFA and the Fund have entered into a written contract (“Expense Limitation Agreement”) that limits operating expenses (excluding any taxes, interest, brokerage fees, Rule 12b-1 fees, short-sale dividend expenses, administrative services fees, other expenses which are capitalized in accordance with generally accepted accounting principles and may exclude other non-routine expenses not incurred in the ordinary course of the Fund’s business) from exceeding 0.32% until at least May 1, 2008. NFA may request and receive reimbursement from the Fund of the advisory fees waived and other expenses reimbursed by NFA, respectively, pursuant to the Expense Limitation Agreement at a later date not to exceed three years from the fiscal year in which the corresponding reimbursement to the Fund was made, (as described below), if the Fund has reached a sufficient asset size to permit reimbursement to be made without causing the total annual operating expense ratio of the Fund to exceed the limits set forth above. No reimbursement will be made unless: (i) the Fund’s assets exceed $100 million; (ii) the total annual expense ratio of the Class making such reimbursement is less than the limit set forth above; and (iii) the payment of such reimbursement is approved by the Board of Trustees on a quarterly basis. Except as provided for in the Expense Limitation Agreement, reimbursement of amounts previously waived or assumed by NFA is not permitted.
As of the six months ended June 30, 2007, there were no reimbursements for all share classes of the Fund.
Under the terms of a Fund Administration and Transfer Agency Agreement, Nationwide Fund Management, LLC (formerly, Gartmore Investor Services, Inc. (“GISI”)) (“NFM”), a wholly-owned subsidiary of NFS Distributors, Inc. (“NFSDI”), provides the Fund with various administrative and accounting services for the Fund (prior to May 1, 2007, this service was provided by Gartmore SA Capital Trust (“GSA”)), and serves as Transfer and Dividend Disbursing Agent for the Fund (prior to May 1, 2007, this service was provided by GISI, an indirect subsidiary of GSA). The fees for the services provided under this Agreement are calculated based on the Trust’s average daily net assets according to the fee schedule below. The fees are then allocated proportionately among all funds within the Trust in relation to the average daily net assets of each fund and are paid to NFA. NFA pays NFM from these fees for NFM’s services.
Combined Fee Schedule* | ||||||
Up to $1 billion | 0.15% | |||||
$1 billion up to $3 billion | 0.10% | |||||
$3 billion up to $8 billion | 0.05% | |||||
$8 billion up to $10 billion | 0.04% | |||||
$10 billion up to $12 billion | 0.02% | |||||
$12 billion or more | 0.01% | |||||
* | The assets of the Nationwide NVIT Investor Destinations Aggressive Fund, the Nationwide NVIT Investor Destinations Moderately Aggressive Fund, the Nationwide NVIT Investor Destinations Moderate Fund, the Nationwide NVIT Investor Destinations Moderately Conservative Fund, and the Nationwide NVIT Investor Destinations Conservative Fund (collectively, the “Investor Destinations Funds”) are excluded from the Trust asset level amount in order to calculate this asset-based fee. The Investor Destinations Funds do not pay any part of this fee. |
NFA and NFM have entered into agreements with Citi Fund Services Ohio, Inc. (“Citi”), pursuant to which Citi provides sub-administration and sub-transfer agency services, respectively, to the Fund. Effective August 1, 2007, The BISYS Group Inc. was acquired by and became a wholly owned subsidiary of Citi.
Under the terms of a Distribution Plan under Rule 12b-1 of the 1940 Act, Nationwide Fund Distributors, LLC. (formerly, “Gartmore Distribution Services, Inc. (“GDSI”)) (“NFD” or “Distributor”), the Fund’s principal underwriter, is compensated by the Fund for expenses associated with the distribution of the Class II shares of the Fund. NFD is a wholly-owned subsidiary of NFSDI. These fees are based on average daily net assets of Class II shares of the Fund at an annual rate not to exceed 0.25%.
Under the terms of an Administrative Services Plan, the Fund may pay fees to servicing organizations, such as broker-dealers, including NFS, and financial institutions, which agree to provide administrative support services to the shareholders of certain classes. These services include, but are not limited, to the following: establishing and maintaining shareholder accounts; processing purchase and redemption transactions; arranging bank wires; performing shareholder sub-accounting; answering inquires regarding the Fund; and other such services. These fees are based on an annual rate of up to 0.25% of the average daily net assets of each class of shares of the Fund.
For the six months ended June 30, 2007, NFS received $420,847 in Administrative Services Fees from the Fund.
Under the terms of a letter agreement dated September 12, 2006, by and among NFA, the Audit Committee of the Trust and the Trust, the Trust has agreed to reimburse NFA certain costs related to the Fund’s portion of ongoing administration, monitoring and annual (audit) testing of the Trust’s Rule 38a-1 Compliance Program subject to the pre-approval of the Trust’s Audit Committee. For the six months ended June 30, 2007, the Fund’s portion of such costs amounted to $5,916.
4. Investment Transactions
For the six months ended June 30, 2007, (excluding short-term securities) the Fund had purchases of $104,420,807 and sales of $83,217,840.
5. Bank Loans and Earnings Credit
The Trust has a credit agreement with JPMorgan Chase & Co., the Fund’s custodian bank, permitting the Trust to borrow up to $100,000,000. Borrowings under this arrangement bear interest at the Federal Funds rate plus 0.50%. The interest costs, if any, would be included in other fees in the Statement of Operations. No compensating balances were required under the terms of the line of credit. The line of credit is renewed annually, expiring on June 25, 2008, with a commitment fee of 0.07% per year on $100,000,000. There were no borrowings outstanding under this line of credit for the six months ended June 30, 2007.
The Trust’s custodian bank has agreed to reduce the bank’s fees (earnings credit) when the funds of the Trust maintain cash on deposit in non-interest-bearing custody and Demand Deposit Accounts. Earnings credits, if any, are shown as a reduction of total expenses on the Statement of Operations.
6. Portfolio Investment Risks
Risks Associated with Foreign Securities and Currencies. Investments in securities of foreign issuers carry certain risks not ordinarily associated with investments in securities of U.S. issuers. These risks include future political and economic developments, and the possible imposition of exchange controls or other foreign governmental laws and restrictions. In addition, with respect to certain countries, there is the possibility of expropriation of assets, confiscatory taxation, political or social instability, or diplomatic developments, which could adversely affect investments in those countries.
Certain countries also may impose substantial restrictions on investments in their capital markets by foreign entities, including restrictions on investments in issuers of industries deemed sensitive to relevant national interests. These factors may limit the investment opportunities available and result in a lack of liquidity and high price volatility with respect to securities of issuers from developing countries.
7. Indemnifications
Under the Trust’s organizational documents, certain of the Trust’s Officers and Trustees are indemnified against certain liabilities arising out of the performance of their duties to the Trust. In addition, the Trust has entered into Indemnification Agreements with the Trust’s trustees and certain officers covering similar liabilities. Trust Officers receive no compensation from the Trust for serving as the Trust’s Officers. In addition, in the normal course of business, the Trust enters into contracts with its vendors and others that provide for general indemnifications. The Trust’s maximum exposure under these arrangements is unknown, as this would involve future claims that may be made against the Trust. Based on experience, however, the Trust expects that risk of loss to be remote.
8. Recently Issued Accounting Pronouncements
On July 13, 2006, the Financial Accounting Standards Board (“FASB”) released FASB Interpretation No. 48, Accounting for Uncertainty in Income Taxes (“FIN 48”). FIN 48 provides guidance for how uncertain tax positions should be recognized, measured, presented and disclosed in the financial statements. FIN 48 requires the affirmative evaluation of tax positions taken or expected to be taken in the course of preparing the Fund’s tax returns to determine whether it is more-likely-than-not (i.e., greater than 50 percent) that each tax position will be sustained upon examination by a taxing authority based on the technical merits of the position. A tax position that meets the more-likely-than-not recognition threshold is measured to determine the amount of benefit to recognize in the financial statements. Differences between tax positions taken in a tax return and amounts recognized in the financial statements will generally result in an increase in a liability for taxes payable (or a reduction of a tax refund receivable) and an increase in a deferred tax liability (or a reduction in a deferred tax asset). Adoption of FIN 48 was required no later than the last business day of the first financial statement reporting period for fiscal years beginning after December 15, 2006 and is to be applied to all open tax years as of the effective date. Accordingly, the Fund was required to implement FIN 48 in its net asset value per share (NAV) calculation on June 29, 2007. Management has evaluated the implications of FIN 48 and has concluded that there was no impact to the Fund’s financial statements as of June 29, 2007. The adoption of FIN 48 requires ongoing
In September 2006, the FASB issued Statement on Financial Accounting Standards (“SFAS”) No. 157, “Fair Value Measurements.” This standard establishes a single authoritative definition of fair value, sets out a framework for measuring fair value and requires additional disclosures about fair value measurements. SFAS No. 157 applies to fair value measurements already required or permitted by existing standards. SFAS No. 157 is effective for financial statements issued for fiscal years beginning after November 15, 2007 and interim periods within those fiscal years. The changes to current accounting principles generally accepted in the United States of America from the application of this Statement relate to the definition of fair value, the methods used to measure fair value, and the expanded disclosures about fair value measurements. As of June 30, 2007, the Fund does not believe the adoption of SFAS No. 157 will impact the financial statement amounts; however, additional disclosures may be required about the inputs used to develop the measurements and the effect of certain of the measurements on changes in net assets for the period.
Trustees who are not Interested Persons (as defined in the 1940 Act) and Officers of the Trust as of
Number of Portfolios | ||||||||||
Position(s) Held | in the | |||||||||
with the Trust | Principal Occupation(s) | Nationwide Fund | Other | |||||||
Name, Address | and Length of | During Past | Complex Overseen | Directorships | ||||||
and Year of Birth | Time Served1 | Five Years | by Trustee | Held by Trustee2 | ||||||
Charles E. Allen c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1948 | Trustee since July 2000 | Mr. Allen is Chairman, Chief Executive Officer and President of Graimark Realty Advisors, Inc. (real estate development, investment and asset management). | 89 | None | ||||||
Paula H.J. Cholmondeley c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1947 | Trustee since July 2000 | Ms. Cholmondeley was Vice President and General Manager of Sappi Fine Paper North America from April 2000 through December 2003. | 89 | Director of Dentsply International, Inc. (dental products), Ultralife Batteries, Inc., Terex Corporation (construction equipment), Minerals Technology, Inc. (specialty chemicals) and Albany International Corp. (paper industry) | ||||||
C. Brent DeVore3 c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1940 | Trustee since 1990 | Dr. DeVore is President of Otterbein College. | 89 | None | ||||||
Phyllis Kay Dryden c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1947 | Trustee since December 2004 | Ms. Dryden was a partner of Mitchell Madison, a management consulting company from January 2006 until December 2006; she is currently a consultant with the company. Ms. Dryden was formerly Managing Partner of march FIRST, a global management consulting firm. | 89 | None | ||||||
Barbara L. Hennigar c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1935 | Trustee since July 2000 | Retired. | 89 | None | ||||||
Number of Portfolios | ||||||||||
Position(s) Held | in the | |||||||||
with the Trust | Principal Occupation(s) | Nationwide Fund | Other | |||||||
Name, Address | and Length of | During Past | Complex Overseen | Directorships | ||||||
and Year of Birth | Time Served1 | Five Years | by Trustee | Held by Trustee2 | ||||||
Barbara I. Jacobs c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1950 | Trustee since December 2004 | Ms. Jacobs served as Chairman of the Board of Directors of KICAP Network Fund, a European (United Kingdom) hedge fund, from January 2001 through January 2006. From 1998-2003, Ms. Jacobs was also a Managing Director and European Portfolio Manager of CREF Investments (Teachers Insurance and Annuity Association-College Retirement Equities Fund). | 89 | None | ||||||
Douglas F. Kridler c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1955 | Trustee since September 1997 | Mr. Kridler has served as the President and Chief Executive Officer of the Columbus Foundation (a Columbus, OH-based foundation which manages over 1,300 individual endowment funds) since February 2002. Prior to January 31, 2002, Mr. Kridler was the President of the Columbus Association for the Performing Arts and Chairman of the Greater Columbus Convention and Visitors Bureau. | 89 | None | ||||||
Michael D. McCarthy c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1947 | Trustee since December 2004 | Retired. Mr. McCarthy was Chairman of VMAC (commodity swaps) from October 2002 until January 2007; and a partner of Pineville Properties LLC (a commercial real estate development firm) from September 2000 until January 2007. | 89 | None | ||||||
David C. Wetmore c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1948 | Trustee since 1995 and Chairman since February 2005 | Retired. | 89 | None | ||||||
1 | Length of time served includes time served with the Trust’s predecessors. | |
2 | Directorships held in (1) any other investment companies registered under the 1940 Act, (2) any company with a class of securities registered pursuant to Section 12 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or (3) any company subject to the requirements of Section 15(d) of the Exchange Act. | |
3 | Mr. DeVore has served as President of Otterbein College since 1984. Mark Thresher, President and Chief Operating Officer of Nationwide Financial Services, Inc. (“NFS”) has served as a member of the Board of Trustees of Otterbein College since 2000, currently serves as one of 30 of its trustees, and is currently one of two Vice Chairmen of the Board. Each of Nationwide Fund Advisors (“NFA”), the Funds’ investment adviser, and Nationwide Fund Distributors LLC (“NFD”), principal underwriter to the Trust, is a wholly-owned subsidiary of NFS. | |
Additional information regarding the Trustees and Officers may be found in the Trust’s Statement of Additional Information, which is available without charge upon request, by calling 800-848-0920. |
Trustees who are Interested Persons (as defined in the 1940 Act) and/or Officers of the Trust as of
Number of Portfolios | ||||||||||
Position(s) Held | in the | |||||||||
with the Trust | Principal Occupation(s) | Nationwide Fund | Other | |||||||
Name, Address | and Length of | During Past | Complex Overseen | Directorships | ||||||
and Year of Birth | Time Served1 | 5 Years | by Trustee | Held by Trustee 2 | ||||||
Arden L. Shisler c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1941 | Trustee since February 2000 | Retired. Mr. Shisler is the former President and Chief Executive Officer of KeB Transport, Inc., a trucking firm (2000 through 2002). He served as a consultant to KeB from January 2003 through December 2004. Since 1992, Mr. Shisler has also been Chairman of the Board for Nationwide Mutual Insurance Company.3 | 89 | Director of Nationwide Financial Services, Inc., Chairman of Nationwide Mutual Insurance Company3 | ||||||
John H. Grady Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1961 | President & Chief Executive Officer since December 2006 | Mr. Grady is President, and Chief Executive Officer of Nationwide Funds Group which includes Nationwide Fund Advisors,3 Nationwide Fund Management LLC,3 Nationwide Fund Distributors LLC 3 and NWD Investments,2 the asset management operations of Nationwide Mutual Insurance Company, which includes Morley Capital Management, Inc.,2 Nationwide Separate Accounts LLC,2 NorthPointe Capital LLC,2 and Nationwide SA Capital Trust2. From March 2004 until March 2006, Mr. Grady was Chief Executive Officer of Constellation Investment Management Co., L.P. (registered investment adviser), and President and Chief Executive Officer of Constellation Funds Group (registered investment companies). He also was President of Constellation Investment Distribution Co., Inc. (registered broker-dealer) from March 2004 until June 2006. From February 2001 until February 2004, Mr. Grady was Chief Operating and Chief Legal Officer; Managing Director, Mutual Funds Group, Turner Investment Partners, Inc. (registered investment adviser); Executive Vice President of Turner Funds and Turner Institutional Portfolios (registered investment companies); and President, Turner Investment Distributors, Inc. (registered broker-dealer). | N/A | None | ||||||
Gerald J. Holland Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1951 | �� | Treasurer since March 2001 | Mr. Holland is Senior Vice President—Operations for Nationwide Funds Group3. | N/A | N/A | |||||
Number of Portfolios | ||||||||||
Position(s) Held | in the | |||||||||
with the Trust | Principal Occupation(s) | Nationwide Fund | Other | |||||||
Name, Address | and Length of | During Past | Complex Overseen | Directorships | ||||||
and Year of Birth | Time Served1 | 5 Years | by Trustee | Held by Trustee 2 | ||||||
Michael A. Krulikowski Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1959 | Chief Compliance Officer from June 2004 to August 20074 | Mr. Krulikowski is Vice President and Chief Compliance Officer of Nationwide Funds Group3, Morley Capital Management, Inc.3, Nationwide SA Capital Trust (since 1999)3, and Nationwide Separate Accounts LLC (since August 2005).3 Since June 2004, Mr. Krulikowski has also served as Chief Compliance Officer of the Trust. From November 1999 through May 2007, he served as Vice President and Chief Compliance Officer of NorthPointe Capital LLC. 3 | N/A | N/A | ||||||
Eric E. Miller Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1953 | Secretary since December 2002 | Mr. Miller is Senior Vice President, General Counsel, and Assistant Secretary for Nationwide Funds Group3 and NWD Investments.2 From August 2000 to August 2002, Mr. Miller was a Partner with Stradley Ronon Stevens & Young, LLP. | N/A | N/A | ||||||
1 | Length of time served includes time served with the Trust’s predecessors. | |
2 | Directorships held in (1) any other investment companies registered under the 1940 Act, (2) any company with a class of securities registered pursuant to Section 12 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or (3) any company subject to the requirements of Section 15(d) of the Exchange Act. | |
3 | This position is held with an affiliated person or principal underwriter of the Trust. | |
4 | Effective August 3, 2007, the Board of Trustees approved Carol Baldwin Moody as Chief Compliance Officer of the Trust. Since November 2005, Ms. Moody has been Senior Vice President, Chief Compliance Officer of Nationwide Financial Services, Nationwide Life Insurance Company, Nationwide Life and Annuity Insurance Company, and Nationwide Investment Advisors, LLC. From February 2004-November 2005, she was Chief Compliance Officer of TIAA-CREF and from April 2000-February 2004, she was Managing Director and General Counsel, TCW/ Latin America Partners, LLC and Baeza & Co., LLC. | |
Federal law requires the Trust, each of its investment advisers and sub-advisers to adopt procedures for voting proxies (“Proxy Voting Guidelines”) and to provide a summary of those Proxy Voting Guidelines used to vote the securities held by the Funds. The Funds’ proxy voting policies and procedures are available without charge (i) upon request, by calling 800-848-0920, (ii) on the Funds’ website at www.nationwidefunds.com, or (iii) on the Securities and Exchange Commission’s website at www.sec.gov. |
A. Renewal of Investment Advisory Agreement
(i) | General Information Regarding the Board’s Review of Investment Advisory Agreements |
The Trust’s investment advisory agreements (each an “Advisory Agreement”) with its investment adviser and, as applicable, sub-advisers (together, the “Adviser”) must be approved for an initial term no greater than two years, and renewed at least annually thereafter, (i) by the vote of the Trustees or by a vote of the shareholders of each series or fund of the Trust (individually a “Fund” ), and (ii) by the vote of a majority of the Trustees who are not parties to the Advisory Agreement or “interested persons” of any party thereto (the “Independent Trustees”) cast in person at a meeting called for the purpose of voting on such approval.
The Board meets quarterly and takes into account throughout the year matters bearing on each Fund’s Advisory Agreement. The Board and its standing committees consider at each meeting factors that are relevant to the annual renewal of an Advisory Agreement, including the services and support provided to a Fund and its shareholders.
On December 6, 2006, the Independent Trustees first met in person with their independent legal counsel (“Independent Legal Counsel”) to consider information provided by the Adviser and others to assist the Trustees in considering whether to renew each Fund’s Advisory Agreement for a one year term beginning May 1, 2007. Immediately following such meeting of the Independent Trustees, all Trustees met in person with the Adviser, Trust counsel, Independent Legal Counsel and others to consider such matters, and give preliminary consideration to information bearing on continuation of each Advisory Agreement. The primary purpose of the December 6 and 7, 2006 meeting was to ensure that the Trustees had ample opportunity to consider matters they deemed relevant in considering the continuation of an Advisory Agreement, and to request any additional information they considered reasonably necessary to their deliberations.
In preparation for the December 6 and 7, 2006 meeting the Trustees were provided, at the request of the Trustees, with a wide range of information to assist in their deliberations, including (i) reports from Lipper Inc. describing a Fund’s (a) performance rankings (where “first quintile” denotes the best performance) (over multiple years ended September 30, 2006) compared with performance groups and performance universes created by Lipper (and in some cases, customized peer groups created by the Adviser) of similar or peer group funds, and (b) expense rankings (where “first quintile” denotes the lowest fees and expenses) comparing the Fund’s contractual advisory fee and total expenses with expense groups and expense universes created by Lipper of similar or peer group funds, (ii) information from the Adviser describing the Fund’s performance (over multiple years ended September 30, 2006) compared with its benchmark and Lipper categories, (iii) for Funds under “close review,” copies of letters from the Adviser to the portfolio manager of each such Fund, together with the portfolio manager’s written response describing the reasons for the Fund’s underperformance (iv) information from the Adviser describing performance for the months of October and November, 2006, and annual performance for the year ended November 30, 2006, (v) reports from the Adviser describing the Adviser’s profitability in providing services under an Advisory Agreement, together with an explanation of Adviser’s methodology in calculating its profitability, (vi) information from the Adviser describing any fees paid to the Adviser for managing similar, non-affiliated institutional accounts, including the range of fee levels for such accounts, and (vii) information from the Adviser describing ancillary benefits, in addition to fees for serving as investment adviser, derived by the Adviser as a result of being investment adviser for a Fund, including, where applicable, information on soft-dollar benefits and fees inuring to the Adviser’s affiliates for serving as the Trust’s administrator, fund accountant and transfer agent.
At the December 6 and 7, 2006 meeting, the Trustees reviewed, considered and discussed, among themselves and with the Adviser, Trust counsel and Independent Legal Counsel, among other things, the information described above, and: (i) the nature, extent and quality of services provided by the Adviser under each Advisory Agreement, (ii) the investment performance of each Fund and the Adviser, (iii) the costs of the services provided by the Adviser under the Advisory Agreement and the profits realized by the Adviser thereunder, (iv) the extent to which economies of scale may be present and, if so, whether they are being shared with a Fund’s shareholders, (v) comparisons of the Adviser’s fees under the Advisory Agreement with investment advisory fees paid by peer group funds to their investment advisers and paid by non-affiliated institutional clients to the Adviser for managing similar accounts, and (vi) any ancillary benefits inuring to the Adviser and its affiliates as a result of being investment adviser for the Trust. The Trustees also considered, where
As part of the December 6 and 7, 2006 Board meeting, the Independent Trustees developed a list of follow-up matters and questions and asked that Adviser respond to such matters and questions at the contract approval meeting of the Board of Trustees to be held on January 11, 2007.
At the January 11, 2007 meeting of the Board of Trustees of the Trust, the Board received and considered information provided by the Adviser in follow-up from the December 6 and 7, 2006 Board meeting and, after consulting among themselves, and with the Adviser, Trust counsel and Independent Legal Counsel, concluded unanimously to renew the Advisory Agreement for the reasons set forth in the following section. In determining whether to renew the Advisory Agreement for the Fund, the Board ultimately reached a determination, with the assistance of Trust counsel and Independent Legal Counsel, that the renewal of the Advisory Agreement and the compensation to be received by the Adviser under the Advisory Agreement is consistent with the Board’s fiduciary duty under applicable law.
(ii) | Board Conclusions Regarding the Fund’s Advisory Agreement |
The Board considered that the Fund had underperformed its benchmark, the MSCI Emerging Markets Index, for the one-, three-, and five-year periods. The Board also considered that the Fund’s Class II shares had ranked in the fifth quintile of the Fund’s Lipper-constructed Performance Group over the one-, two-, three-, four-, and five-year periods. Although the Fund’s performance compared with peer group funds over the periods considered ranked the Fund in the fifth quintile, the Board found that: (i) the portfolio manager for the Fund was changed during the year; (ii) recent performance had shown improvement; and (iii) the flows in and out of the Fund had been more extreme, which made management more difficult, and had affected performance. Based on its review, and giving particular weight to the nature and quality of the resources dedicated by the adviser and subadviser to improve relative performance, the Board concluded that the nature, extent, and quality of the services provided to the Fund will benefit the Fund’s shareholders.
The Board also considered that the Fund’s contractual advisory fee and breakpoints placed the Fund in the first quintile of its Lipper-constructed Expense Group and the Fund’s total expenses placed it in the second quintile. The Board considered that the Fund had implemented a performance fee structure, which is intended to either reward or penalize the adviser for outperforming or underperforming, respectively, the Fund’s benchmark. The Board concluded that the Fund’s management fee and total expenses were fair and reasonable in light of the services that the Fund receives and the other factors considered.
The Board considered that the Fund’s adviser reported a pre-tax profit margin for investment management services during each of the twelve month-periods ended September 30, 2006 and 2005. The Board considered the costs of the services provided by and the profits realized by the adviser in connection with the operation of the Fund and determined that the amount of profit is a fair entrepreneurial profit for the management of the Fund.
Based upon its evaluation of all of the conclusions noted above, and after considering all material factors with respect to the Fund, the Board ultimately concluded that the advisory fee structure is fair and reasonable, and that the Advisory Agreement (and, if applicable, Sub-Advisory Agreement) with respect to the Fund, should be renewed.
B. Approval of New Advisory Agreement
At its January 11, 2007 meeting, the Board also unanimously approved a new investment advisory agreement (the “New Agreement”) for the Fund with Nationwide Fund Advisors, (“NFA”) the then-current adviser to each of the series of the Trust to become effective upon the closing of the acquisition of NFA by Nationwide Financial Services, Inc. (“NFS”) from Nationwide Corporation (“NWC”) which closed on April 30, 2007 (the “Transaction”). In approving the New Agreement, the Board considered NFA’s capacity to continue to provide the services needed to operate a sophisticated investment management business and to support the management of each of the series. The Board also took into account
C. Submission of Matters to a Vote of Security Holders:
On April 25, 2007, a Special Meeting of Shareholders was held* (the “April 25 Meeting”) at which shareholders of the Funds** set forth below were asked:
Proposal 1:
To approve a new investment advisory agreement, on behalf of their Fund, between Nationwide Fund Advisors (formerly “Gartmore Mutual Fund Capital Trust”) (the “Adviser”) and Nationwide Variable Insurance Trust (formerly “Gartmore Variable Insurance Trust”) (the “Trust”).
Number of Shares | ||||||
Fund | Cast/Not Cast | Percentages | ||||
Federated NVIT High Income Bond Fund (Formerly Federated GVIT High Income Bond Fund) | FOR AGAINST ABSTAIN TOTAL | 30,051,703.188 shares 618,245.021 shares 1,813,550.431 shares 32,483,498.640 shares | 92.514% 1.903% 5.583% | |||
NVIT International Index Fund (Formerly GVIT International Index Fund) | FOR AGAINST ABSTAIN TOTAL | 4,322,203.982 shares 2,758.318 shares 135,636.840 shares 4,460,599.140 shares | 96.897% 0.062% 3.041% | |||
NVIT International Value Fund (Formerly GVIT International Value Fund) | FOR AGAINST ABSTAIN TOTAL | 20,032,843.199 shares 333,588.902 shares 1,093,293.879 shares 21,459,725.980 shares | 93.351% 1.554% 5.095% | |||
NVIT Mid Cap Index Fund (Formerly GVIT Mid Cap Index Fund) | FOR AGAINST ABSTAIN TOTAL | 35,380,179.120 shares 631,117.844 shares 1,565,714.306 shares 37,577,011.270 shares | 94.154% 1.679% 4.167% |
Number of Shares | ||||||
Fund | Cast/Not Cast | Percentages | ||||
NVIT S&P 500 Index Fund (Formerly GVIT S&P 500 Index Fund) | FOR AGAINST ABSTAIN TOTAL | 56,119,814.230 shares 666,195.542 shares 1,944,898.888 shares 58,730,908.660 shares | 95.554% 1.134% 3.312% | |||
Nationwide Multi-Manager NVIT Small Cap Growth Fund (Formerly GVIT Small Cap Growth Fund) | FOR AGAINST ABSTAIN TOTAL | 7,632,918.513 shares 149,458.111 shares 451,583.036 shares 8,233,959.660 shares | 92.700% 1.816% 5.484% | |||
Nationwide Multi-Manager NVIT Small Cap Value Fund (Formerly GVIT Small Cap Value Fund) | FOR AGAINST ABSTAIN TOTAL | 48,649,396.525 shares 979,183.753 shares 2,786,133.102 shares 52,414,713.380 shares | 92.816% 1.868% 5.316% | |||
Nationwide Multi-Manager NVIT Small Company Fund (Formerly GVIT Small Company Fund) | FOR AGAINST ABSTAIN TOTAL | 29,903,181.700 shares 838,774.923 shares 2,006,741.307 shares 32,748,697.930 shares | 91.311% 2.561% 6.128% | |||
Gartmore NVIT Developing Markets Fund (Formerly Gartmore GVIT Developing Markets Fund) | FOR AGAINST ABSTAIN TOTAL | 21,0177,889.443 shares 424,272.958 shares 1,543,850.729 shares 23,046,013.130 shares | 91.460% 1.841% 6.699% | |||
Gartmore NVIT Emerging Markets Fund (Formerly Gartmore GVIT Emerging Markets Fund) | FOR AGAINST ABSTAIN TOTAL | 17,050,534.593 shares 526,574.722 shares 881,608.905 shares 18,458,718.220 shares | 92.371% 2.853% 4.776% | |||
Nationwide NVIT Global Financial Services Fund (Formerly Gartmore GVIT Global Financial Services Fund) | FOR AGAINST ABSTAIN TOTAL | 1,554,847.333 shares 19,539.033 shares 52,206.494 shares 1,626,592.860 shares | 95.589% 1.201% 3.210% | |||
Nationwide NVIT Global Health Sciences Fund (Formerly Gartmore GVIT Global Health Sciences Fund) | FOR AGAINST ABSTAIN TOTAL | 4,722,963.678 shares 157,979.030 shares 207,642.222 shares 5,088,584.930 shares | 92.815% 3.104% 4.081% | |||
Nationwide NVIT Global Technology and Communications Fund (Formerly Gartmore GVIT Global Technology and Communications Fund) | FOR AGAINST ABSTAIN TOTAL | 8,585,472.039 shares 102,267.977 shares 489,577.634 shares 9,177,317.650 shares | 93.551% 1.114% 5.335% | |||
Gartmore NVIT Global Utilities Fund (Formerly Gartmore GVIT Global Utilities Fund) | FOR AGAINST ABSTAIN TOTAL | 4,123,270.549 shares 122,001.533 shares 240,276.088 shares 4,485,548.170 shares | 91.923% 2.720% 5.357% | |||
Nationwide NVIT Government Bond Fund (Formerly Gartmore GVIT Government Bond Fund) | FOR AGAINST ABSTAIN TOTAL | 88,471,567.462 shares 1,825,645.181 shares 5,841,990.727 shares 96,139,203.370 shares | 92.024% 1.899% 6.077% |
Number of Shares | ||||||
Fund | Cast/Not Cast | Percentages | ||||
Nationwide NVIT Growth Fund (Formerly Gartmore GVIT Growth Fund) | FOR AGAINST ABSTAIN TOTAL | 14,931,435.904 shares 409,826.402 shares 1,259,945.064 shares 16,601,207.370 shares | 89.942% 2.469% 7.589% | |||
Gartmore NVIT International Growth Fund (Formerly Gartmore GVIT International Growth Fund) | FOR AGAINST ABSTAIN TOTAL | 6,251,419.070 shares 139,618.548 shares 290,025.592 shares 6,681,063.210 shares | 93.569% 2.090% 4.341% | |||
Nationwide NVIT Investor Destinations Aggressive Fund (Formerly Gartmore GVIT Investor Destinations Aggressive Fund) | FOR AGAINST ABSTAIN TOTAL | 49,489,224.549 shares 1,385,396.474 shares 3,696,272.337 shares 54,570,893.360 shares | 90.688% 2.539% 6.773% | |||
Nationwide NVIT Investor Destinations Conservative Fund (Formerly Gartmore GVIT Investor Destinations Conservative Fund) | FOR AGAINST ABSTAIN TOTAL | 23,091,965.887 shares 314,935,884 shares 2,292,355.179 shares 25,699,256.950 shares | 89.855% 1.225% 8.920% | |||
Nationwide NVIT Investor Destinations Moderate Fund (Formerly Gartmore GVIT Investor Destinations Moderate Fund) | FOR AGAINST ABSTAIN TOTAL | 188,902,093.059 shares 3,018,924.590 shares 16,359,690.401 shares 208,280,708.050 shares | 90.696% 1.449% 7.855% | |||
Nationwide NVIT Investor Destinations Moderately Aggressive Fund (Formerly Gartmore GVIT Investor Destinations Moderately Aggressive Fund) | FOR AGAINST ABSTAIN TOTAL | 134,792,622.920 shares 3,489,207.264 shares 9,304,197.656 shares 147,586,027.840 shares | 91.332% 2.364% 6.304% | |||
Nationwide NVIT Investor Destinations Moderately Conservative Fund (Formerly Gartmore GVIT Investor Destinations Moderately Conservative Fund) | FOR AGAINST ABSTAIN TOTAL | 49,627,123.216 shares 856,088.634 shares 3,507,215.650 shares 53,990,427.500 shares | 91.918% 1.586% 6.496% | |||
Nationwide NVIT Mid Cap Growth Fund (Formerly Gartmore GVIT Mid Cap Growth Fund) | FOR AGAINST ABSTAIN TOTAL | 10,879,584.971 shares 352,594.958 shares 717,792.971 shares 11,949,972.900 shares | 91.043% 2.950% 6.007% | |||
Nationwide NVIT Money Market Fund II (Formerly Gartmore GVIT Money Market Fund II) | FOR AGAINST ABSTAIN TOTAL | 221,774,863.241 shares 12,322,482.494 shares 16,471,740.875 shares 250,569,086.610 shares | 88.508% 4.918% 6.574% | |||
Nationwide NVIT Money Market Fund (Formerly Gartmore GVIT Money Market Fund) | FOR AGAINST ABSTAIN TOTAL | 1,578,331,008.328 shares 32,372,133.671 shares 112,652,123.301 shares 1,723,355,265.300 shares | 91.585% 1.878% 6.537% | |||
NVIT Nationwide Fund (Formerly Gartmore GVIT Nationwide Fund) | FOR AGAINST ABSTAIN TOTAL | 125,423,274.735 shares 2,767,979.467 shares 8,762,255.828 shares 136,953,510.030 shares | 91.581% 2.021% 6.398% |
Number of Shares | ||||||
Fund | Cast/Not Cast | Percentages | ||||
NVIT Nationwide Leaders Fund (Formerly Gartmore GVIT Nationwide Leaders Fund) | FOR AGAINST ABSTAIN TOTAL | 2,298,504.956 shares 29,630.469 shares 71,637.755 shares 2,399,773.180 shares | 95.780% 1.235% 2.985% | |||
Nationwide NVIT U.S. Growth Leaders Fund (Formerly Gartmore GVIT U.S. Growth Leaders Fund) | FOR AGAINST ABSTAIN TOTAL | 4,972,094.773 shares 122,623.161 shares 174,625.606 shares 5,269,343.540 shares | 94.359% 2.327% 3.314% | |||
Gartmore NVIT Worldwide Leaders Fund (Formerly Gartmore GVIT Worldwide Leaders Fund) | FOR AGAINST ABSTAIN TOTAL | 2,666,862.487 shares 47,702.491 shares 118,719.882 shares 2,833,284.860 shares | 94.126% 1.684% 4.190% | |||
JP Morgan NVIT Balanced Fund (Formerly JP Morgan GVIT Balanced Fund) | FOR AGAINST ABSTAIN TOTAL | 15,966,867.546 shares 259,004.324 shares 1,339,385.200 shares 17,565,257.070 shares | 90.900% 1.475% 7.625% | |||
Van Kampen NVIT Comstock Value Fund (Formerly Van Kampen GVIT Comstock Value Fund) | FOR AGAINST ABSTAIN TOTAL | 27,737,008.009 shares 502,564.164 shares 1,824,670.107 shares 30,064,242.280 shares | 92.259% 1.672% 6.069% | |||
Van Kampen NVIT Multi Sector Bond Fund (Formerly Van Kampen GVIT Multi Sector Bond Fund) | FOR AGAINST ABSTAIN TOTAL | 21,253,297.665 shares 484,100.920 shares 1,803,963.645 shares 23,541,362.230 shares | 90.281% 2.056% 7.663% | |||
At the April 25 Meeting, shareholders of the Nationwide NVIT Mid Cap Growth Fund were also asked to approve a new investment subadvisory agreement among the Adviser, the Trust and NorthPointe Capital LLC. The voting results with respect to that proposal are set forth below:
Proposal 2:
Number of Shares | ||||||
Fund | Cast/Not Cast | Percentages | ||||
Nationwide NVIT Mid Cap Growth Fund (Formerly Gartmore GVIT Mid Cap Growth Fund) | FOR AGAINST ABSTAIN TOTAL | 10,862,827.499 shares 414,574.660 shares 672,570.741 shares 11,949,972.900 shares | 90.903% 3.469% 5.628% | |||
* | This meeting was previously adjourned on April 23, 2007. | |
** | Fund names were changed effective May 1, 2007 to reflect “Nationwide”/“NVIT” branding to coincide with the sale of Nationwide Fund Advisors, Inc. by Nationwide Corporation to its majority-owned subsidiary, Nationwide Financial Services, Inc. |
June 30, 2007 (Unaudited)
Contents | ||
6 | Statement of Investments | |
20 | Statement of Assets and Liabilities | |
21 | Statement of Operations | |
22 | Statements of Changes in Net Assets | |
23 | Financial Highlights | |
24 | Notes to Financial Statements |
Statement Regarding Availability of Proxy Voting Record.
SAR-VKMS (8/07) | ![]() |
Dear Fellow Shareholder:
Since I last wrote to you, our mutual funds have enjoyed another period of solid performance, and the corporate realignment that was in progress is now finished.
On May 1, 2007, Nationwide Financial Services, Inc. (NFS), completed its acquisition of the Philadelphia-based retail mutual fund operations of NWD Investment Management, Inc. (formerly, “Gartmore Global Investments, Inc.”), from Nationwide Corporation, a subsidiary of Nationwide Mutual Insurance Company. Effective that date, the acquired entities were renamed Nationwide Funds Group (NFG), and the Gartmore Funds were renamed the Nationwide Funds to better align with the Nationwide® brand. Although the corporate ownership and fund names have changed, I can assure you that NFG intends to maintain as much continuity as possible with the Funds and key personnel.
Thank you, shareholders, for approving the new investment advisory agreement that was required due to the change in corporate ownership. The new agreement is identical in all material respects to the original agreement that it replaces, with the exception of the section pertaining to the vote by the shareholders of the NVIT Mid Cap Growth Fund to approve NorthPointe Capital®, LLC (NorthPointe) as sub-adviser to that particular Fund.
Market Overview: January 1-June 30, 2007
Share prices in general were buoyed in part by better-than-expected first-quarter 2007 earnings and a flurry of mergers and acquisitions, many of these spurred by readily available funding from private equity firms. In June, investors grew more cautious amid surging crude oil prices, a sudden spike in long-term interest rates, and the meltdown of two hedge funds that had exposure to the subprime mortgage market. Looking abroad, a weak U.S. dollar aided foreign stocks, as reflected in the 11.09% advance of the Morgan Stanley Capital International Europe, Australasia and Far East (MSCI EAFE®) Index. Emerging market performance was particularly robust.
The bond market struggled during the first half of 2007. While short-term interest rates remained stable, reflecting the Federal Reserve Board’s decision in June to leave the target federal funds rate at 5.25%, longer-term rates climbed during the first half of 2007, depressing bond prices and forcing the Lehman Brothers® U.S. Aggregate Index to settle for a modest 0.97% return.
We at NFG thank you for your understanding and cooperation throughout our recent transition period. We emerge from this period energized for the future, and we look forward to serving your investment needs for a long time to come.
Nationwide Funds Group
PAST PERFORMANCE IS NO GUARANTEE OF FUTURE RESULTS.
Nationwide Funds are advised by Nationwide Fund Advisors (NFA). NFA is a wholly-owned subsidiary of Nationwide Financial Services. Nationwide Financial Services is a wholly-owned subsidiary of Nationwide Corporation. All of the common stock of Nationwide Corporation is held by Nationwide Mutual (95.2%) and Nationwide Mutual Fire Insurance Company (4.8%), each of which is a mutual company owned by its policyholders.
Nationwide Funds Group (NFG) is the mutual fund arm of Nationwide Financial Services (NYSE: NFS). Based in Conshohocken, Pa., a suburb of Philadelphia, NFG is comprised of Nationwide Fund Advisors, Nationwide Fund Distributors, LLC, and Nationwide Fund Management, LLC. Together, these provide advisory, distribution, and administration services respectively to the Nationwide Funds, and manage more than $43.5 billion in assets as of June 30, 2007, of which more than $12 billion are in “fund of funds” designed to provide asset allocation across several types of investments and asset classes.
Lehman Brothers (LB) U.S. Aggregate Index: An unmanaged, market value-weighted index of investment-grade, fixed-rate debt issues (including government, corporate, asset-backed, and mortgage-backed securities with maturities of one year or more) that is generally representative of the bond market as a whole.
Morgan Stanley Capital International Europe, Australasia and Far East (MSCI EAFE®) Index: An unmanaged, free float-adjusted, market capitalization-weighted index that is designed to measure the performance of stocks in developed markets outside the United States and Canada.
Standard & Poor’s 500® (S&P 500) Index: An unmanaged, market capitalization-weighted index of 500 widely held stocks of large-cap U.S. companies that gives a broad look at how the stock prices of those companies have performed.
Views expressed within are those of Nationwide Funds Group as of the date noted, are subject to change at any time, and may not come to pass.
This report is for informational purposes only, and is not intended as an offer or recommendation with respect to the purchase or sale of any security, option, future, or other derivatives in such securities.
Investing in mutual funds involves risk, including possible loss of principal.
Investors should carefully consider a fund’s investment objectives, risks, fees, charges, and expenses before investing any money. To obtain this and other fund information, please call 800-848-0920 to request a prospectus, or download a prospectus at www.nationwidefunds.com. Please read the prospectus carefully before investing any money.
Nationwide Funds distributed by Nationwide Fund Distributors LLC (formerly Gartmore Distribution Services, Inc.), Member NASD. 1200 River Road, Suite 1000, Conshohocken, Pa. 19428.
As a shareholder of the Fund, you incur two types of costs: (1) transaction costs, including sales charges (loads) paid on purchase payments and redemption fees; and (2) ongoing costs, including investment advisory fees, administration fees, distribution fees and other Fund expenses. The examples below are 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. Per SEC requirements, the examples assume that you had a $1,000 investment in the Class at the beginning of the reporting period, January 1, 2007, and continued to hold your shares at the end of the reporting period, June 30, 2007.
Actual Expenses
Hypothetical Example for Comparison Purposes
Please note that the expenses shown in the table are meant to highlight your ongoing costs only and do not reflect any transaction costs, such as sales charges (loads) or redemption fees. Therefore, the second line for each Class in 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 transaction costs were included, your costs would have been higher. The examples also assume all dividends and distributions have been reinvested.
Schedule of Shareholder Expenses
Van Kampen NVIT Multi Sector Bond Fund | ||||||||||||||||||||||
Beginning | Ending | Expenses Paid | Annualized | |||||||||||||||||||
Account Value, | Account | During Period* | Expense Ratio* | |||||||||||||||||||
January 1, 2007 | Value, | |||||||||||||||||||||
June 30, 2007 | ||||||||||||||||||||||
Class I | Actual | $ | 1,000.00 | $ | 1,010.30 | $ | 4.98 | 1.00% | ||||||||||||||
Hypothetical | 1 | $ | 1,000.00 | $ | 1,019.84 | $ | 5.02 | 1.00% | ||||||||||||||
* | Expenses are equal to the Fund’s annualized expense ratio multiplied by the average account value over the period multiplied by 181/365 (to reflect the one-half year period). The expense ratio presented represents a six-month, annualized ratio in accordance with SEC guidelines. The expenses reported above do not include the effect of additional expenses imposed by variable annuity contracts. | |
1 | Represents the hypothetical 5% return before expenses. |
Asset Allocation | ||||
Corporate Bonds | 33.5% | |||
Asset-Backed Securities | 17.4% | |||
Sovereign Bonds | 13.4% | |||
Mortgage-Backed Obligations | 12.2% | |||
U.S. Treasury Obligations | 10.0% | |||
Interest Only Bonds | 5.4% | |||
Federal National Mortgage Association | 5.4% | |||
Government Bonds | 3.0% | |||
Yankee Dollars | 0.8% | |||
Repurchase Agreements | 0.5% | |||
Options Purchased | 0.4% | |||
U.S. Treasury Bills | 0.3% | |||
Warrants | 0.1% | |||
U.S. Government Agency Long-Term Obligations | 0.0% | |||
Federal Home Loan Mortgage Corporation | 0.0% | |||
Other Investments* | 5.9% | |||
Liabilities in excess of other assets** | -8.3% | |||
100.0% |
Top Holdings*** | ||||
U.S. Treasury Notes, 6.13%, 08/15/29 | 5.5% | |||
Federal National Mortgage Association, 4.93%, 08/08/07 | 3.1% | |||
Bundes Republic of Deutschland (EUR), 5.63%, 01/04/28 | 2.5% | |||
Federal Home Loan Bank, 4.61%, 07/18/07 | 2.1% | |||
U.S. Treasury Notes, 8.13%, 08/15/19 | 2.0% | |||
Bonos Y Oblig Del Estado (EUR), 5.15%, 07/30/09 | 1.3% | |||
Residential Accredit Loans, Inc., 5.52%, 06/25/37 | 1.1% | |||
United Kingdom Treasury (GBP), 7.25%, 12/07/07 | 1.0% | |||
Federal National Mortgage Association TBA, 6.50%, 07/15/37 | 1.0% | |||
U.S. Treasury Notes, 3.88%, 02/15/13 | 1.0% | |||
Other | 79.4% | |||
100.0% |
Top Industries | ||||
Diversified Financial Services | 9.6% | |||
Real Estate Investment Trusts (REITs) | 4.6% | |||
Banks | 4.1% | |||
Oil, Gas & Consumable Fuels | 2.5% | |||
Media | 2.0% | |||
Automobiles | 1.8% | |||
Telephones | 1.1% | |||
Health Care Providers & Services | 1.1% | |||
Food Products | 1.1% | |||
Electric Utilities | 0.9% | |||
Other | 71.2% | |||
100.0% |
Top Countries | ||||
United States | 86.6% | |||
Germany | 2.5% | |||
Spain | 1.5% | |||
Philippines | 1.3% | |||
Mexico | 1.2% | |||
Brazil | 1.2% | |||
Russian Federation | 1.1% | |||
United Kingdom | 1.0% | |||
Turkey | 0.7% | |||
Venezuela | 0.6% | |||
Other | 2.3% | |||
100.0% |
* | Includes value of collateral received from securities lending. |
** | Includes value of collateral owed from securities lending. |
*** | For purpose of listing top holdings, repurchase agreements are included as part of Other. |
Van Kampen NVIT Multi Sector Bond Fund
Corporate Bonds (33.5%) | |||||||||
Principal Amount | Value | ||||||||
Aerospace & Defense (0.1%) (a) | |||||||||
Systems 2001 Asset Trust, 6.66%, 09/15/13 | $ | 261,573 | $ | 271,150 | |||||
Auto Components (0.1%) (b) | |||||||||
Arvinmeritor, Inc., 8.75%, 03/01/12 | 225,000 | 227,250 | |||||||
Automobiles (1.8%) | |||||||||
DaimlerChrysler AG, 8.50%, 01/18/31 | 180,000 | 227,464 | |||||||
Ford Motor Credit Co., 7.25%, 10/25/11 | 1,470,000 | 1,414,775 | |||||||
General Motors Acceptance Corp., 6.88%, 09/15/11 | 2,235,000 | 2,198,467 | |||||||
Sonic Automotive, Inc., Series B, 8.63%, 08/15/13 (b) | 445,000 | 458,350 | |||||||
4,299,056 | |||||||||
Banks (3.2%) | |||||||||
Banco ABN AMRO Real SA, 15.86%, 12/13/07 (a) | 600,000 | 317,272 | |||||||
Bank One Corp., 6.00%, 02/17/09 | 95,000 | 95,806 | |||||||
Chase Manhattan Corp., 7.00%, 11/15/09 | 240,000 | 247,917 | |||||||
Harborview Mortgage Loan Trust (c) 5.50%, 11/19/36 | 1,546,050 | 1,540,007 | |||||||
5.41%, 01/19/38 | 424,915 | 425,234 | |||||||
5.51%, 01/19/38 | 1,697,859 | 1,699,703 | |||||||
JP Morgan & Chase Co. Note, 1.36%, 01/03/12 (d) | 855,000 | 453,709 | |||||||
KFW International Finance, 2.05%, 09/21/09 | 94,000,000 | 778,470 | |||||||
Kinder Morgan Finance, 5.70%, 01/05/16 | 635,000 | 585,265 | |||||||
Marshall & Ilsley Bank, 3.80%, 02/08/08 | 605,000 | 599,436 | |||||||
RSHB Capital 7.18%, 05/16/13 (a) | 280,000 | 291,620 | |||||||
7.18%, 05/16/13 | 100,000 | 104,200 | |||||||
Unicredito Luxem Finance, 5.41%, 10/24/08 (a) (c) | 440,000 | 440,124 | |||||||
7,578,763 | |||||||||
Beverages (0.1%) (a) | |||||||||
FBG Finance Ltd., 5.13%, 06/15/15 | 250,000 | 234,299 | |||||||
Building Products (0.0%) (b) (c) | |||||||||
Goodman Global Holdings, 8.36%, 06/15/12 | 50,000 | 50,375 | |||||||
Chemicals (0.4%) | |||||||||
Equistar Chemical, 10.13%, 09/01/08 (b) | 189,000 | 196,560 | |||||||
ICI Wilmington, 4.38%, 12/01/08 | 115,000 | 113,062 | |||||||
Innophos, Inc., 8.88%, 08/15/14 | 430,000 | 445,050 | |||||||
JohnsonDiversey, Inc., 9.63%, 05/15/12 (b) | 180,000 | 187,875 | |||||||
942,547 | |||||||||
Communications Equipment (0.1%) (b) | |||||||||
Nortel Networks Corp., 4.25%, 09/01/08 | 190,000 | 187,388 | |||||||
Consumer Goods (0.1%) (c) | |||||||||
Clorox Co., 5.49%, 12/14/07 | 210,000 | 210,106 | |||||||
Containers & Packaging (0.5%) (b) | |||||||||
Berry Plastics Corp., 8.88%, 09/15/14 | 685,000 | 693,562 | |||||||
Graphic Packaging International, 9.50%, 08/15/13 | 165,000 | 171,394 | |||||||
Owens-Illinois, Inc., 7.50%, 05/15/10 | 230,000 | 232,013 | |||||||
1,096,969 | |||||||||
Diversified Financial Services (9.6%) | |||||||||
AIG SunAmerica Global Finance, 6.30%, 05/10/11 (a) | 395,000 | 404,548 | |||||||
American General Finance Corp., 4.63%, 05/15/09 | 95,000 | 93,688 | |||||||
American Home Mortgage Investment Trust, Series 2004-1 Class 1A, 5.67%, 04/25/44 (c) | 198,820 | 199,056 | |||||||
AXA Financial, Inc., 7.75%, 08/01/10 | 460,000 | 489,701 | |||||||
Capmark Financial Group (a) 5.88%, 05/10/12 | 200,000 | 197,379 | |||||||
6.30%, 05/10/17 | 85,000 | 83,644 | |||||||
Carrington Mortgage Loan Trust, 5.47%, 09/25/35 (c) | 73,664 | 73,672 |
Corporate Bonds (continued) | |||||||||
Principal Amount | Value | ||||||||
Diversified Financial Services (continued) | |||||||||
Caterpillar Financial Services Corp. 5.43%, 08/20/07 (c) | $ | 220,000 | $ | 220,026 | |||||
Series MTNF 3.63%, 11/15/07 | 75,000 | 74,512 | |||||||
Countrywide Alternative Loan Trust, 5.51%, 10/25/46 (c) | 1,078,878 | 1,076,479 | |||||||
Countrywide Home Loans, Inc., 3.25%, 05/21/08 | 220,000 | 215,618 | |||||||
Deutsche Telekom International Finance (EUR), 8.13%, 05/29/12 | 160,000 | 244,602 | |||||||
Farmers Exchange Capital, 7.05%, 07/15/28 (a) | 285,000 | 288,713 | |||||||
Fresenius Medical Care Capital Trust Series IV, 7.88%, 06/15/11 | �� | 95,000 | 98,325 | ||||||
General Electric Capital Corp., 4.25%, 12/01/10 | 100,000 | 96,487 | |||||||
Harborview Mortgage Loan Trust 5.70%, 11/19/35 (c) | 610,648 | 613,336 | |||||||
5.57%, 08/21/36 (c) | 1,325,526 | 1,327,044 | |||||||
5.53%, 11/19/36 (c) | 1,539,637 | 1,544,045 | |||||||
0.96%, 03/19/37 (d) | 2,982 | 2,243 | |||||||
5.57%, 10/19/37 (c) | 1,122,350 | 1,124,909 | |||||||
5.61%, 07/19/45 (c) | 333,241 | 334,011 | |||||||
Household Finance Corp. (EUR), 6.50%, 05/05/09 | 140,000 | 195,238 | |||||||
John Hancock Global Funding, Series II, 7.90%, 07/02/10 (a) | 155,000 | 165,438 | |||||||
Luminent Mortgage Trust (c) 5.56%, 04/25/36 | 777,524 | 779,059 | |||||||
5.52%, 10/25/46 | 985,336 | 987,441 | |||||||
Mantis Reef Ltd., 4.69%, 11/14/08 (a) (e) | 425,000 | 420,046 | |||||||
MBNA Corp., 5.79%, 05/05/08 (c) | 460,000 | 461,741 | |||||||
MBNA Credit Card Master Note Trust, 5.44%, 08/16/10 (c) | 1,750,000 | 1,751,737 | |||||||
Merrill Lynch Mortgage Investors, Inc., 5.44%, 08/25/35 (c) | 196,621 | 196,741 | |||||||
Nationstar Home Equity Loan Trust, 6.02%, 09/25/36 (c) | 1,251,817 | 1,251,815 | |||||||
Residential Accredit Loans, Inc. (c) 5.51%, 12/25/36 | 1,279,411 | 1,272,077 | |||||||
5.48%, 01/25/37 | 1,631,606 | 1,628,882 | |||||||
5.52%, 06/25/37 | 2,485,754 | 2,486,143 | |||||||
5.58%, 02/25/46 | 433,180 | 433,510 | |||||||
5.59%, 02/25/46 | 410,958 | 411,711 | |||||||
2.47%, 03/25/47 | 7,450,000 | 409,750 | |||||||
Residential Capital Corp. 6.38%, 06/30/10 | 460,000 | 454,062 | |||||||
6.50%, 04/17/13 (b) | 325,000 | 314,138 | |||||||
22,421,567 | |||||||||
Electric Power (0.1%) | |||||||||
Ohio Power Co., 6.00%, 06/01/16 | 225,000 | 225,215 | |||||||
Wisconsin Electric Power Co., 3.50%, 12/01/07 | 110,000 | 109,102 | |||||||
334,317 | |||||||||
Electric Utilities (0.9%) | |||||||||
AES Corp. 9.38%, 09/15/10 | 53,000 | 56,379 | |||||||
7.75%, 03/01/14 (b) | 95,000 | 95,237 | |||||||
9.00%, 05/15/15 (a) | 305,000 | 322,919 | |||||||
Arizona Public Service Co., 5.80%, 06/30/14 | 250,000 | 246,688 | |||||||
Detroit Edison Co., 6.13%, 10/01/10 | 200,000 | 203,565 | |||||||
Entergy Gulf States 3.60%, 06/01/08 | 65,000 | 63,840 | |||||||
6.11%, 12/08/08 (c) (a) | 270,000 | 270,723 | |||||||
5.76%, 12/01/09 (c) | 105,000 | 104,948 | |||||||
Foundation P.A. Coal Co., 7.25%, 08/01/14 (b) | 50,000 | 49,563 | |||||||
Ipalco Enterprises, Inc., 8.38%, 11/14/08 | 465,000 | 474,300 | |||||||
NiSource Finance Corp., 5.93%, 11/23/09 (c) | 120,000 | 120,187 | |||||||
2,008,349 | |||||||||
Energy Companies (0.4%) | |||||||||
Hilcorp Energy, 7.75%, 11/01/15 (a) (b) | 230,000 | 223,100 | |||||||
National Grid Transco PLC (EUR), 5.00%, 07/02/18 | 110,000 | 144,376 | |||||||
TXU Corp., 4.81%, 11/17/14 | 300,000 | 292,476 | |||||||
TXU Energy Co., 7.00%, 03/15/13 | 225,000 | 232,085 | |||||||
892,037 | |||||||||
Van Kampen NVIT Multi Sector Bond Fund (Continued)
Corporate Bonds (continued) | |||||||||
Principal Amount | Value | ||||||||
Energy Equipment & Services (0.0%) (b) | |||||||||
Cie General De Geophysique, 7.50%, 05/15/15 | $ | 40,000 | $ | 40,000 | |||||
Food Products (1.1%) | |||||||||
Conagra Foods, Inc. 7.00%, 10/01/28 | 150,000 | 156,255 | |||||||
8.25%, 09/15/30 | 100,000 | 118,367 | |||||||
Delhaize America, Inc., 9.00%, 04/15/31 | 356,000 | 430,101 | |||||||
Michael Foods, 8.00%, 11/15/13 | 120,000 | 121,200 | |||||||
Pilgrim’s Pride Corp. 9.63%, 09/15/11 (b) | 270,000 | 280,463 | |||||||
7.63%, 05/01/15 | 1,020,000 | 1,017,450 | |||||||
Sara Lee Corp., 6.13%, 11/01/32 | 265,000 | 237,070 | |||||||
Smithfield Foods, Inc., 8.00%, 10/15/09 | 90,000 | 92,700 | |||||||
2,453,606 | |||||||||
Gas Utilities (0.2%) | |||||||||
Pacific Energy Partners, 7.13%, 06/15/14 | 150,000 | 155,193 | |||||||
Williams Cos., Inc. (The), 7.88%, 09/01/21 | 255,000 | 274,125 | |||||||
429,318 | |||||||||
Health Care Equipment & Supplies (0.0%) (a) | |||||||||
Invacare Corp., 9.75%, 02/15/15 | 80,000 | 80,600 | |||||||
Health Care Providers & Services (1.1%) | |||||||||
Aramark Corp. (a) 8.50%, 02/01/15 | 60,000 | 61,050 | |||||||
8.86%, 02/01/15 (c) (b) | 50,000 | 50,750 | |||||||
Aramark Services, Inc., 5.00%, 06/01/12 (b) | 210,000 | 184,800 | |||||||
Columbia HCA, 7.69%, 06/15/25 | 370,000 | 321,824 | |||||||
Fresenius Medical Capital Trust II, 7.88%, 02/01/08 | 350,000 | 353,500 | |||||||
HCA, Inc. 6.25%, 02/15/13 (b) | 345,000 | 311,362 | |||||||
5.75%, 03/15/14 | 185,000 | 156,556 | |||||||
Hospira, Inc., 5.83%, 03/30/10 (c) | 490,000 | 491,230 | |||||||
Sun Healthcare Group, Inc., 9.13%, 04/15/15 (a) (b) | 265,000 | 275,600 | |||||||
Tenet Healthcare Corp. 7.38%, 02/01/13 (b) | 310,000 | 280,163 | |||||||
9.88%, 07/01/14 | 65,000 | 64,350 | |||||||
2,551,185 | |||||||||
Hotels, Restaurants & Leisure (0.5%) | |||||||||
Isle of Capri Casinos, 7.00%, 03/01/14 | 490,000 | 463,662 | |||||||
MGM Mirage, Inc., 6.00%, 10/01/09 | 300,000 | 297,375 | |||||||
Station Casinos, Inc., 6.00%, 04/01/12 | 340,000 | 319,600 | |||||||
1,080,637 | |||||||||
Insurance (0.3%) | |||||||||
Farmers Insurance Exchange, 8.63%, 05/01/24 (a) | 250,000 | 288,857 | |||||||
Munich Re Finance BV, 6.75%, 06/21/23 | 130,000 | 189,529 | |||||||
St. Paul Travelers, 5.01%, 08/16/07 | 240,000 | 239,897 | |||||||
718,283 | |||||||||
Internet Software & Services (0.0%) (f) (g) | |||||||||
Exodus Communications, Inc. 0.00%, 07/15/10 | 124,552 | 0 | |||||||
Rhythms Netconnections 0.00%, 02/15/10 | 366,692 | 0 | |||||||
0 | |||||||||
Manufacturing (0.7%) | |||||||||
Interface, Inc. 10.38%, 02/01/10 | 60,000 | 64,500 | |||||||
9.50%, 02/01/14 | 225,000 | 242,437 | |||||||
K&F Acquisition, Inc., 7.75%, 11/15/14 (b) | 370,000 | 392,200 | |||||||
Koppers Holdings, Inc., 2.14%, 11/15/14 (d) | 255,000 | 218,025 | |||||||
Koppers, Inc., 9.88%, 10/15/13 | 47,000 | 50,173 |
Corporate Bonds (continued) | |||||||||
Principal Amount | Value | ||||||||
Manufacturing (continued) | |||||||||
Manitowoc Co., Inc., 10.50%, 08/01/12 (b) | $ | 214,000 | $ | 225,770 | |||||
Nalco Co., 7.75%, 11/15/11 (b) | 165,000 | 166,237 | |||||||
Propex Fabrics, Inc., 10.00%, 12/01/12 | 385,000 | 344,575 | |||||||
1,703,917 | |||||||||
Media (2.0%) | |||||||||
Cablevision Systems Corp., 9.82%, 04/01/09 (c) | 290,000 | 303,050 | |||||||
CCH I LLC, 11.00%, 10/01/15 | 210,000 | 219,187 | |||||||
Comcast Cable Communication, Inc., 6.75%, 01/30/11 | 300,000 | 310,517 | |||||||
Dex Media West/ Finance Series B, 9.88%, 08/15/13 | 75,000 | 80,250 | |||||||
Echostar DBS Corp. 6.38%, 10/01/11 | 550,000 | 539,000 | |||||||
6.63%, 10/01/14 | 70,000 | 66,850 | |||||||
Idearc, Inc., 8.00%, 11/15/16 (b) | 535,000 | 540,350 | |||||||
Intelsat Bermuda Ltd., 8.87%, 01/15/15 (c) (a) | 435,000 | 444,244 | |||||||
Interpublic Group Co., Inc., 6.25%, 11/15/14 | 205,000 | 188,088 | |||||||
National Cable PLC (b) 8.75%, 04/15/14 | 75,000 | 77,250 | |||||||
9.13%, 08/15/16 | 100,000 | 104,750 | |||||||
Time Warner, Inc., 5.59%, 11/13/09 (c) | 645,000 | 645,620 | |||||||
Umbrella Acquisition, 9.75%, 03/15/15 (a) (b) | 320,000 | 316,000 | |||||||
Valassis Communication, 8.25%, 03/01/15 (a) (b) | 480,000 | 468,000 | |||||||
Viacom, Inc., 6.88%, 04/30/36 | 380,000 | 367,127 | |||||||
4,670,283 | |||||||||
Metals & Mining (0.0%) (b) (f) (g) | |||||||||
Murrin Murrin Holdings, 9.38%, 08/31/07 | 125,000 | 0 | |||||||
Multiline Retail (0.3%) | |||||||||
May Department Stores Co., 6.70%, 07/15/34 | 360,000 | 334,661 | |||||||
Yum! Brands, Inc., 8.88%, 04/15/11 | 230,000 | 253,050 | |||||||
587,711 | |||||||||
Oil, Gas & Consumable Fuels (2.5%) | |||||||||
Centerpoint Energy, 6.25%, 02/01/37 | 70,000 | 67,416 | |||||||
Chaparral Energy, Inc., 8.88%, 02/01/17 (a) | 210,000 | 207,375 | |||||||
Colorado Interstate Gas, 6.80%, 11/15/15 (b) | 150,000 | 154,262 | |||||||
Consolidated Natural Gas, 6.25%, 11/01/11 | 260,000 | 265,584 | |||||||
Consumers Energy Co., 4.80%, 02/17/09 | 210,000 | 207,457 | |||||||
Cooper Industries, Inc., 5.25%, 11/15/12 | 205,000 | 201,030 | |||||||
Gazprom Capital 6.21%, 11/22/16 | 310,000 | 301,940 | |||||||
8.63%, 04/28/34 | 190,000 | 237,434 | |||||||
Hanover Equipment Trust, Series A, 8.62%, 09/01/08 (b) | 126,000 | 125,370 | |||||||
Husky Oil Ltd., 8.90%, 08/15/28 | 525,000 | 541,209 | |||||||
Pemex Project Funding Master Trust, 6.66%, 06/15/10 (c) (a) | 570,000 | 584,820 | |||||||
Pemex Project Funding Master Trust (EUR), 6.63%, 04/04/10 | 250,000 | 351,793 | |||||||
Petro Shopping Centre, 9.00%, 02/15/12 | 320,000 | 337,600 | |||||||
Petroleos Mexicanos 8.63%, 12/01/23 | 250,000 | 304,625 | |||||||
9.50%, 09/15/27 | 720,000 | 966,960 | |||||||
Plains All American Pipeline, 6.70%, 05/15/36 | 230,000 | 230,267 | |||||||
Pogo Producing Co., 6.88%, 10/01/17 (b) | 210,000 | 208,425 | |||||||
Sandridge Energy, 8.63%, 04/01/15 | 325,000 | 333,125 | |||||||
Texas Eastern Transmission, 7.00%, 07/15/32 | 215,000 | 235,844 | |||||||
5,862,536 | |||||||||
Van Kampen NVIT Multi Sector Bond Fund (Continued)
Corporate Bonds (continued) | |||||||||
Principal Amount | Value | ||||||||
Paper & Forest Products (0.4%) | |||||||||
P.H. Glatfelter, 7.13%, 05/01/16 | $ | 65,000 | $ | 65,487 | |||||
Pindo Deli Finance BV (a) 6.00%, 04/28/15 (c) | 132,046 | 112,239 | |||||||
6.00%, 04/28/18 (c) | 446,898 | 246,911 | |||||||
11.18%, 04/28/25 (d) | 901,231 | 126,172 | |||||||
Tjiwi Kimia Finance BV 6.00%, 04/28/15 (c) | 192,480 | 169,383 | |||||||
6.00%, 04/28/15 (c) (a) | 183,878 | 161,813 | |||||||
6.00%, 04/28/18 (c) (a) | 183,062 | 101,142 | |||||||
10.36%, 04/28/27 (a) (d) | 473,111 | 63,870 | |||||||
1,047,017 | |||||||||
Real Estate Investment Trusts (REITs) (4.6%) | |||||||||
American Home Mortgage Assets 5.55%, 05/25/46 (c) | 1,336,573 | 1,336,154 | |||||||
5.55%, 09/25/46 (c) | 1,493,817 | 1,498,496 | |||||||
5.51%, 10/25/46 (c) | 1,870,831 | 1,873,682 | |||||||
5.45%, 03/25/47 (c) | 1,500,210 | 1,498,726 | |||||||
5.51%, 08/25/47 (c) | 1,875,000 | 1,875,000 | |||||||
5.52%, 08/25/47 | 1,875,000 | 1,875,000 | |||||||
Brascan Corp., 7.13%, 06/15/12 | 250,000 | 262,630 | |||||||
Brookfield Asset Management, 5.80%, 04/25/17 | 95,000 | 92,741 | |||||||
World Financial, 6.91%, 09/01/13 (a) | 478,596 | 493,955 | |||||||
10,806,384 | |||||||||
Semiconductors & Semiconductor Equipment (0.2%) (a) (b) | |||||||||
Freescale Semiconductor, 8.88%, 12/15/14 | 535,000 | 510,925 | |||||||
Service Companies (0.5%) | |||||||||
CVS Corp., 6.04%, 12/10/28 (a) | 425,425 | 412,888 | |||||||
Iron Mountain, Inc. 8.63%, 04/01/13 | 195,000 | 195,487 | |||||||
7.75%, 01/15/15 | 180,000 | 175,500 | |||||||
Waste Management, Inc., 7.13%, 10/01/07 | 450,000 | 451,268 | |||||||
1,235,143 | |||||||||
Specialty Retail (0.3%) | |||||||||
CVS Caremark Corp., 5.75%, 06/01/17 | 205,000 | 197,789 | |||||||
CVS Corp., 5.75%, 08/15/11 | 65,000 | 64,995 | |||||||
Home Depot, Inc., 5.49%, 12/16/09 (c) | 320,000 | 319,502 | |||||||
582,286 | |||||||||
Telephones (1.1%) | |||||||||
American Tower Corp. 7.50%, 05/01/12 | 275,000 | 282,563 | |||||||
7.13%, 10/15/12 (b) | 100,000 | 102,250 | |||||||
AT&T Corp., 8.00%, 11/15/31 (c) | 295,000 | 350,631 | |||||||
Axtel SA, 11.00%, 12/15/13 (b) | 285,000 | 313,500 | |||||||
France Telecom 8.50%, 03/01/31 | 115,000 | 144,497 | |||||||
8.13%, 01/28/33 | 90,000 | 154,895 | |||||||
Nordic Tel Co. Holdings, 8.88%, 05/01/16 (a) (b) | 155,000 | 164,300 | |||||||
Qwest Communications International, 8.86%, 02/15/09 (c) | 150,000 | 151,500 | |||||||
Qwest Corp., 5.63%, 11/15/08 | 45,000 | 44,831 | |||||||
SBC Communications, Inc., 6.15%, 09/15/34 | 140,000 | 134,233 | |||||||
Sprint Capital Corp., 8.75%, 03/15/32 | 40,000 | 44,925 | |||||||
Telecom Italia Capital 4.00%, 11/15/08 | 110,000 | 107,662 | |||||||
4.00%, 01/15/10 | 195,000 | 187,458 | |||||||
Telefonica Europe, 8.25%, 09/15/30 | 220,000 | 255,699 | |||||||
Verizon New England, 6.50%, 09/15/11 | 10,000 | 10,264 | |||||||
Wind Acquisition Financial SA, 10.75%, 12/01/15 (a) | 200,000 | 229,500 | |||||||
2,678,708 | |||||||||
Tobacco (0.1%) | |||||||||
RJ Reynolds Tobacco, 6.50%, 07/15/10 | 150,000 | 152,488 | |||||||
Corporate Bonds (continued) | |||||||||
Principal Amount | Value | ||||||||
Transportation (0.2%) | |||||||||
CHC Helicopter Corp., 7.38%, 05/01/14 | $ | 220,000 | $ | 209,550 | |||||
Union Pacific Corp. 6.79%, 11/09/07 | 100,000 | 100,363 | |||||||
6.63%, 02/01/08 | 180,000 | 181,155 | |||||||
491,068 | |||||||||
Wireless Telecommunication Services (0.0%) (f) (g) | |||||||||
Nextlink Communications, Inc. 0.00%, 06/01/09 | 350,000 | 0 | |||||||
0.00%, 06/01/09 | 500,000 | 0 | |||||||
0 | |||||||||
Total Corporate Bonds (Cost $78,190,272) | 78,436,268 | ||||||||
Asset-Backed Securities (17.4%) | |||||||||
Banc of America Funding Corp., 5.67%, 09/20/35 (c) | 286,896 | 287,930 | |||||||
Bear Stearns, 5.46%, 03/25/37 | 1,411,646 | 1,371,988 | |||||||
Bear Stearns Asset Backed, Inc., 5.54%, 03/25/35 (c) | 256,335 | 256,384 | |||||||
Bear Stearns Mortgage Funding Trust (c) 5.57%, 07/25/36 | 1,275,195 | 1,273,754 | |||||||
5.48%, 12/25/36 | 1,083,588 | 1,084,474 | |||||||
Capital Auto Receivables Asset Trust 5.38%, 07/15/10 | 1,650,000 | 1,649,742 | |||||||
5.38%, 05/15/11 (c) | 1,900,000 | 1,899,729 | |||||||
Countrywide Alternative Loan Trust (c) 5.60%, 10/25/35 | 9,930 | 9,930 | |||||||
5.58%, 11/20/35 | 443,714 | 443,927 | |||||||
5.70%, 11/20/35 | 702,423 | 705,547 | |||||||
6.73%, 02/25/36 | 1,083,733 | 1,090,257 | |||||||
5.59%, 07/25/46 | 841,766 | 843,173 | |||||||
5.37%, 09/25/46 | 320,470 | 320,434 | |||||||
DSLA Mortgage Loan Trust (c) 5.52%, 11/19/37 | 1,434,922 | 1,437,684 | |||||||
5.97%, 04/19/47 | 1,264,072 | 1,264,467 | |||||||
First Franklin Mortgage Loan, 5.37%, 07/25/36 (c) | 1,142,092 | 1,142,028 | |||||||
Fremont Home Loan Trust, 5.37%, 10/25/36 (c) | 1,230,060 | 1,229,457 | |||||||
Greenpoint Mortgage Funding Trust, 5.64%, 03/25/36 (c) | 1,100,207 | 1,102,070 | |||||||
GSAMP Trust, 5.39%, 01/25/37 (c) | 1,290,550 | 1,290,461 | |||||||
GSR Mortgage Loan Trust, 5.51%, 08/25/46 (c) | 1,349,454 | 1,350,707 | |||||||
Harborview Mortgage Loan Trust, 5.55%, 07/19/46 (c) | 1,072,316 | 1,073,196 | |||||||
Indymac Index Mortgage Loan Trust (c) 5.44%, 07/25/46 | 1,725,000 | 1,729,824 | |||||||
5.57%, 06/25/47 | 1,329,861 | 1,334,485 | |||||||
Residential Asset Mortgage, Inc. (c) 5.39%, 08/25/36 | 1,131,704 | 1,131,766 | |||||||
5.40%, 10/25/36 | 1,071,896 | 1,072,003 | |||||||
Securitized Asset Backed Receivables 5.46%, 11/25/36 | 1,299,008 | 1,298,553 | |||||||
5.46%, 08/25/47 | 1,200,000 | 1,200,000 | |||||||
Soundview Home Equity Loan Trust (c) 5.40%, 01/25/37 | 1,172,754 | 1,172,751 | |||||||
5.43%, 02/25/37 | 1,117,618 | 1,117,345 | |||||||
Structured Asset Investment Loan Trust, 5.66%, 11/25/33 (c) | 28,003 | 28,034 | |||||||
Structured Asset Mortgage Investments, Inc. (c) | |||||||||
5.51%, 02/25/36 | 445,755 | 446,222 | |||||||
5.63%, 02/25/36 | 877,919 | 881,371 | |||||||
5.59%, 04/25/36 | 1,396,129 | 1,399,474 | |||||||
5.55%, 07/25/36 | 702,044 | 704,121 | |||||||
5.55%, 07/25/36 | 1,167,060 | 1,170,536 | |||||||
5.55%, 08/25/36 | 1,100,764 | 1,103,787 | |||||||
Structured Asset Securities Corp., 5.52%, 06/25/35 (c) | 134,139 | 134,152 | |||||||
Washington Mutual, Inc. (c) | |||||||||
5.59%, 04/25/45 | 576,819 | 577,860 | |||||||
5.61%, 08/25/45 | 141,477 | 141,548 | |||||||
5.58%, 10/25/45 | 326,805 | 326,971 | |||||||
5.57%, 11/25/45 | 367,375 | 368,016 | |||||||
5.57%, 12/25/45 | 322,388 | 322,687 | |||||||
5.97%, 04/25/46 | 1,062,975 | 1,064,055 | |||||||
5.42%, 05/25/46 | 95,255 | 95,261 |
Van Kampen NVIT Multi Sector Bond Fund (Continued)
Asset-Backed Securities (continued) | |||||||||
Principal Amount | Value | ||||||||
Zuni Mortgage Loan Trust, 5.45%, 08/25/36 (c) | $ | 868,315 | $ | 867,874 | |||||
Total Asset-Backed Securities (Cost $40,826,713) | 40,816,035 | ||||||||
Sovereign Bonds (13.4%) | |||||||||
Argentina (0.4%) | |||||||||
Republic of Argentina 0.00%, 04/10/05 (f) | 390,000 | 182,520 | |||||||
5.83%, 12/31/33 | 1,850,000 | 824,637 | |||||||
8.38%, 12/31/33 | 49,788 | 47,929 | |||||||
1,055,086 | |||||||||
Brazil (1.2%) | |||||||||
Citigroup, Inc. Brazil LTN Note, 6.00%, 05/18/09 | 250,000 | 306,519 | |||||||
Federal Republic of Brazil 14.50%, 10/15/09 | 520,000 | 616,200 | |||||||
10.50%, 07/14/14 | 180,000 | 226,620 | |||||||
8.88%, 10/14/19 | 856,000 | 1,039,184 | |||||||
Series B 8.88%, 04/15/24 | 470,000 | 578,100 | |||||||
2,766,623 | |||||||||
Canada (0.3%) | |||||||||
Canadian Government (CAD), 5.25%, 06/01/12 | 700,000 | 677,120 | |||||||
Colombia (0.4%) | |||||||||
Republic of Columbia 9.75%, 04/09/11 | 108,307 | 116,971 | |||||||
8.25%, 12/22/14 | 155,000 | 173,367 | |||||||
11.75%, 02/25/20 | 100,000 | 147,750 | |||||||
7.38%, 09/18/37 | 410,000 | 455,100 | |||||||
893,188 | |||||||||
Ecuador (0.1%) | |||||||||
Republic of Ecuador 9.38%, 12/15/15 | 100,000 | 88,750 | |||||||
10.00%, 08/15/30 | 290,000 | 237,800 | |||||||
326,550 | |||||||||
Germany (2.5%) | |||||||||
Bundes Republic of Deutschland (EUR), | |||||||||
5.63%, 01/04/28 | 3,820,000 | 5,762,026 | |||||||
Italy (0.1%) | |||||||||
Buoni Poliennali Del Tesson (EUR), 5.25%, 11/01/29 | 120,000 | 167,949 | |||||||
Ivory Coast (0.0%) (f) | |||||||||
Ivory Coast, 2.50%, 03/30/18 | 285,000 | 94,050 | |||||||
Japan (0.2%) | |||||||||
Japanese Government (JPY), 0.80%, 03/20/13 | 50,000,000 | 389,684 | |||||||
Mexico (1.2%) | |||||||||
Mexican Fixed Rate Bonds (MXN) 9.50%, 12/18/14 | 14,250,000 | 1,452,569 | |||||||
8.00%, 12/17/15 | 6,360,000 | 600,029 | |||||||
United Mexican States, 8.38%, 01/14/11 | 710,000 | 770,350 | |||||||
2,822,948 | |||||||||
Peru (0.4%) | |||||||||
Republic of Peru 9.88%, 02/06/15 | 145,000 | 179,945 | |||||||
8.38%, 05/03/16 | 120,000 | 139,500 | |||||||
8.75%, 11/21/33 | 390,000 | 505,050 | |||||||
824,495 | |||||||||
Philippines (1.3%) | |||||||||
Republic of Philippines 9.00%, 02/15/13 | 270,000 | 301,050 | |||||||
8.88%, 03/17/15 | 1,060,000 | 1,215,025 | |||||||
9.50%, 02/02/30 | 1,208,000 | 1,574,870 | |||||||
3,090,945 | |||||||||
Russian Federation (1.1%) | |||||||||
Russian Federation 11.00%, 07/24/18 | 516,000 | 718,066 | |||||||
12.75%, 06/24/28 | 960,000 | 1,691,491 | |||||||
7.50%, 03/31/30 | 239,743 | 264,077 | |||||||
2,673,634 | |||||||||
Spain (1.5%) | |||||||||
Bonos Y Oblig Del Estado (EUR) 5.15%, 07/30/09 | 2,250,000 | 3,083,066 | |||||||
6.15%, 01/31/13 | 330,000 | 480,055 | |||||||
3,563,121 | |||||||||
Sweden (0.3%) (b) | |||||||||
Swedish Government (SEK), 5.00%, 01/28/09 | 4,500,000 | 665,818 | |||||||
Sovereign Bonds (continued) | |||||||||
Principal Amount | Value | ||||||||
Turkey (0.7%) | |||||||||
Citigroup, Inc. Turkey LTN Note, 12.00%, 08/14/08 (a) | $ | 500,000 | $ | 629,075 | |||||
Republic of Turkey 17.96%, 08/13/08 (d) | 865,200 | 543,915 | |||||||
11.88%, 01/15/30 | 156,000 | 239,070 | |||||||
Turkey Government Bond, 18.28%, 02/04/09 (d) | 441,100 | 256,995 | |||||||
1,669,055 | |||||||||
Ukraine (0.1%) (a) (b) | |||||||||
Ukraine Government, 6.58%, 11/21/16 | 230,000 | 227,987 | |||||||
United Kingdom (1.0%) | |||||||||
United Kingdom Treasury (GBP), 7.25%, 12/07/07 | 1,200,000 | 2,422,746 | |||||||
Venezuela (0.6%) | |||||||||
Republic of Venezuela | |||||||||
10.75%, 09/19/13 | 640,000 | 710,720 | |||||||
8.50%, 10/08/14 | 270,000 | 273,375 | |||||||
9.25%, 09/15/27 | 340,000 | 354,450 | |||||||
1,338,545 | |||||||||
Total Sovereign Bonds (Cost $26,059,119) | 31,431,570 | ||||||||
Mortgage-Backed Obligations (12.2%) | |||||||||
American Home Mortgage, 5.51%, 05/25/47 (c) | 1,846,119 | 1,845,301 | |||||||
Bear Stearns Mortgage, 5.49%, 03/25/37 (c) | 1,602,286 | 1,604,042 | |||||||
Countrywide Alternative Loan Trust (c) 6.50%, 10/25/46 | 335,494 | 335,284 | |||||||
5.46%, 04/25/47 | 1,511,167 | 1,511,123 | |||||||
Deutsche Alt-A Securities, Inc. (c) 5.47%, 02/25/47 | 1,729,584 | 1,724,981 | |||||||
6.75%, 02/25/47 | 438,953 | 438,559 | |||||||
Federal Home Loan Mortgage Corp. | |||||||||
Pool # 170271 12.00%, 08/01/15 | 224,708 | 244,951 | |||||||
Gold, Pool # C90381 7.50%, 11/01/20 | 1,304 | 1,365 | |||||||
Gold, Pool # C00712 6.50%, 02/01/29 | 30,709 | 31,372 | |||||||
Gold, Pool # C29808 8.00%, 08/01/29 | 20,462 | 21,560 | |||||||
Gold, Pool # C39060 8.00%, 06/01/30 | 501 | 528 | |||||||
Gold, Pool # C41333 7.50%, 08/01/30 | 20,136 | 21,020 | |||||||
Gold, Pool # C41531 8.00%, 08/01/30 | 8,202 | 8,645 | |||||||
Gold, Pool # C42327 8.00%, 09/01/30 | 2,480 | 2,614 | |||||||
Gold, Pool # C44964 7.50%, 11/01/30 | 40,591 | 42,372 | |||||||
Gold, Pool # C01104 8.00%, 12/01/30 | 35,561 | 37,481 | |||||||
Gold, Pool # C01132 8.00%, 01/01/31 | 31,578 | 33,284 | |||||||
Gold, Pool # C46946 8.00%, 01/01/31 | 12,294 | 12,958 | |||||||
Gold, Pool # C01150 8.00%, 02/01/31 | 28,832 | 30,389 | |||||||
Gold, Pool # C48997 8.00%, 03/01/31 | 88,875 | 93,675 | |||||||
Gold, Pool # C49587 8.00%, 03/01/31 | 19,553 | 20,615 | |||||||
Gold, Pool # C50477 8.00%, 04/01/31 | 34,564 | 36,442 | |||||||
Gold, Pool # C53597 8.00%, 06/01/31 | 151,906 | 160,157 | |||||||
Gold, Pool # C53381 8.00%, 06/01/31 | 4,825 | 5,086 | |||||||
Gold, Pool # C53657 8.00%, 06/01/31 | 10,607 | 11,183 | |||||||
Gold, Pool # C60019 7.50%, 11/01/31 | 8,475 | 8,840 | |||||||
Gold, Pool # C67851 7.50%, 06/01/32 | 152,906 | 159,207 | |||||||
5.66%, 03/01/37 | 1,062,009 | 1,059,651 | |||||||
Federal National Mortgage Association | |||||||||
Pool # 50946 6.50%, 12/01/23 | 24,620 | 24,957 | |||||||
Pool # 346286 6.50%, 05/01/26 | 77,207 | 78,525 |
Van Kampen NVIT Multi Sector Bond Fund (Continued)
Mortgage-Backed Obligations (continued) | |||||||||
Principal Amount | Value | ||||||||
Pool # 370191 6.50%, 01/01/27 | $ | 5,900 | $ | 6,000 | |||||
Pool # 251752 6.50%, 06/01/28 | 120,713 | 123,203 | |||||||
Pool # 252009 6.50%, 07/01/28 | 297,006 | 303,134 | |||||||
Pool # 415967 6.50%, 10/01/28 | 98,534 | 100,567 | |||||||
Pool # 457953 6.50%, 01/01/29 | 95,127 | 97,089 | |||||||
Pool # 482616 6.50%, 02/01/29 | 184,400 | 188,193 | |||||||
Pool # 323591 6.50%, 03/01/29 | 203,477 | 207,675 | |||||||
Pool # 511954 7.50%, 10/01/29 | 8,129 | 8,503 | |||||||
Pool # 519145 7.50%, 10/01/29 | 21,321 | 22,304 | |||||||
Pool # 523284 7.50%, 11/01/29 | 2,178 | 2,279 | |||||||
Pool # 527589 7.50%, 01/01/30 | 9,598 | 10,040 | |||||||
Pool # 517874 7.50%, 02/01/30 | 35,213 | 36,778 | |||||||
Pool # 253113 7.50%, 03/01/30 | 18,661 | 19,526 | |||||||
Pool # 540017 8.00%, 05/01/30 | 6,016 | 6,338 | |||||||
Pool # 540091 7.50%, 06/01/30 | 17,894 | 18,689 | |||||||
Pool # 535399 8.00%, 07/01/30 | 30,517 | 32,149 | |||||||
Pool # 535533 8.00%, 10/01/30 | 104,012 | 109,572 | |||||||
Pool # 563324 7.00%, 12/01/30 | 79,191 | 81,313 | |||||||
Pool # 564363 8.00%, 01/01/31 | 2,322 | 2,447 | |||||||
Pool # 253673 7.50%, 03/01/31 | 28,867 | 30,150 | |||||||
Pool # 564993 7.50%, 03/01/31 | 14,733 | 15,388 | |||||||
Pool # 253674 8.00%, 03/01/31 | 1,812 | 1,909 | |||||||
Pool # 613017 8.00%, 03/01/31 | 1,232 | 1,304 | |||||||
Pool # 576112 7.00%, 05/01/31 | 2,978 | 3,087 | |||||||
Pool # 577407 7.50%, 07/01/31 | 55,439 | 57,863 | |||||||
Pool # 545239 8.00%, 09/01/31 | 41,256 | 43,462 | |||||||
Pool # 545604 8.00%, 09/01/31 | 14,766 | 15,629 | |||||||
Pool # 606566 7.50%, 10/01/31 | 18,994 | 19,824 | |||||||
Pool # 545551 8.00%, 04/01/32 | 23,475 | 24,730 | |||||||
Pool # 630601 7.00%, 05/01/32 | 222,960 | 230,949 | |||||||
Pool # 545759 6.50%, 07/01/32 | 183,849 | 187,105 | |||||||
Pool # 642656 7.00%, 07/01/32 | 57,628 | 59,693 | |||||||
Pool # 254695 6.50%, 04/01/33 | 295,127 | 299,880 | |||||||
Pool # 555533 6.50%, 04/01/33 | 87,703 | 89,408 | |||||||
Pool # 741875 6.50%, 09/01/33 | 31,417 | 31,923 | |||||||
Pool # 836295 7.00%, 10/01/35 | 607,999 | 624,288 | |||||||
Pool # 868995 7.47%, 05/01/36 | 1,968,609 | 2,016,259 | |||||||
Pool # 886574 7.50%, 08/01/36 | 1,163,026 | 1,195,653 | |||||||
Federal National Mortgage Association TBA(h) | |||||||||
6.50%, 08/01/36 | 1,300,000 | 1,310,969 | |||||||
6.50%, 07/15/37 | 2,250,000 | 2,271,094 | |||||||
Government National Mortgage Association | |||||||||
Pool # 780699 9.50%, 12/15/17 | 165,423 | 178,733 | |||||||
Pool # 780378 11.00%, 01/15/19 | 184,684 | 203,235 | |||||||
Pool # 780141 10.00%, 12/15/20 | 154,391 | 170,465 | |||||||
Pool # 780709 11.00%, 01/15/21 | 210,164 | 230,708 | |||||||
Pool # 780349 10.00%, 09/15/21 | 195,568 | 215,595 | |||||||
Greenpoint Mortgage Funding Trust, 5.52%, 03/25/47 (c) | 1,815,421 | 1,819,313 | |||||||
GS Mortgage Securities Corp., 6.25%, 01/25/37 (c) | 462,658 | 460,962 |
Mortgage-Backed Obligations (continued) | |||||||||
Principal Amount | Value | ||||||||
Harborview Mortgage Loan Trust (c) 5.52%, 03/19/38 | $ | 1,628,926 | $ | 1,631,297 | |||||
6.41%, 03/19/38 | 330,968 | 330,554 | |||||||
Harborview Nim Corp., 6.41%, 03/19/37 (c) | 341,368 | 340,941 | |||||||
Lehman Brothers, 5.44%, 09/15/21 (c) (a) | 751,461 | 751,458 | |||||||
Residential Asset Mortgage, Inc., 5.48%, 02/25/37 (c) | 1,161,992 | 1,161,230 | |||||||
SLM Student Loan Trust, 5.35%, 10/27/14 (c) | 1,575,144 | 1,575,316 | |||||||
Total Mortgage-Backed Obligations (Cost $28,735,507) | 28,582,340 | ||||||||
Interest Only Bonds (5.4%) | |||||||||
Bear Stearns Structured Products, Inc. (c) | |||||||||
1.32%, 02/27/36 (a) | 18,627,332 | 493,624 | |||||||
2.08%, 06/26/36 | 21,136,794 | 822,221 | |||||||
1.75%, 01/27/37 | 27,311,910 | 1,007,809 | |||||||
1.84%, 01/27/37 | 19,633,676 | 746,080 | |||||||
2.44%, 01/27/37 | 16,713,022 | 715,535 | |||||||
Countrywide Alternative Loan Trust (c) | |||||||||
1.42%, 09/25/35 | 23,519,074 | 488,756 | |||||||
2.05%, 12/20/35 (a) | 7,038,160 | 180,135 | |||||||
3.16%, 12/20/35 (a) | 8,303,159 | 364,534 | |||||||
5.47%, 05/25/36 | 410,917 | 410,963 | |||||||
2.72%, 02/25/37 | 6,411,451 | 312,558 | |||||||
2.70%, 03/20/46 | 5,819,638 | 245,804 | |||||||
2.46%, 12/20/46 | 21,854,465 | 997,984 | |||||||
2.57%, 02/25/47 | 14,440,341 | 736,165 | |||||||
2.81%, 03/20/47 | 10,556,224 | 562,478 | |||||||
2.70%, 05/25/47 | 6,953,214 | 368,090 | |||||||
Federal Home Loan Mortgage Corp. Series 2129 (c) | |||||||||
1.63%, 06/17/27 | 1,324,605 | 54,656 | |||||||
Series 2557, Class IW 6.00%, 04/15/32 | 986,043 | 164,631 | |||||||
Series 2649, Class IM 7.00%, 07/15/33 | 424,122 | 119,130 | |||||||
Federal National Mortgage Association Series 2003-82, Class IA | |||||||||
6.00%, 08/25/32 | 283,437 | 41,772 | |||||||
Series 03-39, Class IO | |||||||||
6.00%, 05/25/33 | 388,753 | 93,486 | |||||||
6.50%, 05/25/33 (c) | 918,002 | 241,106 | |||||||
6.50%, 05/25/33 (c) | 370,670 | 92,816 | |||||||
Series 2003-44, Class IB | |||||||||
6.00%, 06/25/33 | 428,448 | 103,417 | |||||||
6.50%, 06/25/33 (c) | 369,939 | 96,727 | |||||||
Greenpoint Mortgage Funding Trust (c) | |||||||||
2.21%, 08/25/45 | 3,363,193 | 99,887 | |||||||
2.11%, 10/25/45 | 4,549,949 | 135,134 | |||||||
2.35%, 10/25/45 | 1,939,052 | 46,149 | |||||||
Harborview Mortgage Loan Trust (c) | |||||||||
1.62%, 11/19/34 | 8,936,281 | 164,763 | |||||||
1.97%, 05/19/35 | 6,521,644 | 149,794 | |||||||
1.66%, 06/19/35 | 4,631,228 | 104,926 | |||||||
2.32%, 03/19/37 | 5,574,078 | 239,511 | |||||||
0.00%, 07/19/47 (f) | 41 | 21 | |||||||
2.44%, 07/19/47 | 6,640,119 | 235,517 | |||||||
Indymac Index Mortgage Loan Trust, | |||||||||
1.24%, 07/25/35 (c) | 4,173,613 | 130,425 | |||||||
Residential Accredit, 2.90%, 05/25/47 (c) | 14,950,000 | 864,297 | |||||||
Structured Asset Mortgage, 1.23%, 04/25/37 (c) | 24,075,000 | 1,016,639 | |||||||
Total Interest Only Bonds (Cost $11,351,415) | 12,647,540 | ||||||||
Warrants (0.1%)* | |||||||||
Banks (0.1%) | |||||||||
Central Bank of Nigeria (f) (g) | 500 | 0 | |||||||
Mexican Warrant | 366 | 31,110 | |||||||
Republic of Venezuela (f) | 1,250 | 0 | |||||||
Republic of Argentina 5.83%, 12/15/35 | 4,154,313 | 165,134 | |||||||
8.28%, 12/15/35 | 130,001 | 18,950 | |||||||
215,194 | |||||||||
Van Kampen NVIT Multi Sector Bond Fund (Continued)
Warrants (continued) | |||||||||
Shares or | |||||||||
Principal Amount | Value | ||||||||
Communications Equipment (0.0%) | |||||||||
XO Holdings, Inc. (b) expiring | |||||||||
0.00%, 01/16/10 | 248 | $ | 1,106 | ||||||
0.00%, 01/16/10 | 499 | 369 | |||||||
0.00%, 01/16/10 | 374 | 146 | |||||||
0.00%, 01/16/10 | 374 | 60 | |||||||
1,681 | |||||||||
Total Warrants (Cost $22,326) | 216,875 | ||||||||
Yankee Dollars (0.8%) | |||||||||
Banks (0.8%) | |||||||||
ABN AMRO Real SA, 16.20%, 02/22/10 | $ | 410,000 | $ | 242,604 | |||||
Argentina Securities, Inc., 2006 M3, 5.37%, 10/25/36 (c) | 1,265,085 | 1,265,143 | |||||||
JP Morgan & Chase Co., 7.00%, 06/28/17 | 6,000,000 | 231,257 | |||||||
RSHB Capital, 6.30%, 05/15/17 (a) | 106,000 | 103,753 | |||||||
Total Yankee Dollars (Cost $1,589,966) | 1,842,757 | ||||||||
Government Bonds (3.0%) (d) | |||||||||
Federal Home Loan Bank 4.18%, 07/11/07 | 2,000,000 | 1,997,450 | |||||||
4.61%, 07/18/07 | 5,000,000 | 4,988,665 | |||||||
Total Government Bonds (Cost $6,985,460) | 6,986,115 | ||||||||
Federal National Mortgage Association (5.4%) | |||||||||
Federal National Mortgage Association 4.93%, 08/08/07 (d) | 7,200,000 | 7,162,258 | |||||||
5.13%, 06/01/35 | 1,164,574 | 1,161,887 | |||||||
5.01%, 09/01/35 | 1,029,640 | 1,014,408 | |||||||
5.10%, 11/01/35 | 1,194,006 | 1,172,120 | |||||||
4.74%, 06/01/36 | 1,189,561 | 1,169,632 | |||||||
Federal National Mortgage Association TBA, 7.00%, 07/01/36 (h) | 925,000 | 949,570 | |||||||
Total Federal National Mortgage Association (Cost $12,675,071) | 12,629,875 | ||||||||
Federal Home Loan Mortgage Corporation (0.0%) | |||||||||
IOETTE, Series 1103, Class N, 1,156.50%, 06/15/21 | 11 | 150 | |||||||
U.S. Treasury Bills (0.3%) (d) | |||||||||
U.S. Treasury Bills, 2.81%, 07/12/07 | 700,000 | 699,345 | |||||||
U.S. Treasury Obligations (10.0%) (b) | |||||||||
U.S. Treasury Notes 5.75%, 08/15/10 | 1,000,000 | 1,024,531 | |||||||
3.88%, 02/15/13 | 2,360,000 | 2,241,447 | |||||||
8.13%, 08/15/19 | 3,625,000 | 4,583,925 | |||||||
7.63%, 02/15/25 | 1,000,000 | 1,273,438 | |||||||
6.38%, 08/15/27 | 1,300,000 | 1,486,063 | |||||||
6.13%, 08/15/29 | 11,475,000 | 12,871,725 | |||||||
Total U.S. Treasury Obligations (Cost $23,804,991) | 23,481,129 | ||||||||
U.S. Government Agency Long-Term Obligations (0.0%) | |||||||||
Federal Home Loan Mortgage Corp., Pool #C69951, 6.50%, 08/01/32 | 44,168 | 44,984 | |||||||
Repurchase Agreements (0.5%) (c) | ||||||||
Principal Amount | Value | |||||||
Nomura Securities, 5.20% dated 06/29/07, due 07/02/07, repurchase price $1,034,818, collateralized by U.S. Government Agency Mortgages with a market value of $1,055,057, 5.20%, 04/01/42 | $ | 1,034,370 | $ | 1,034,370 | ||||
90 Day Euro Future Put option (strike price 94.75), expiring December 2007 | 685 | 256,875 | ||||||
90 Day Euro Future Put option (strike price 94.75), expiring March 2008 | 221 | 109,119 | ||||||
90 Day Euro Future Put option (strike price 94.75), expiring September 2007 | 592 | 162,800 | ||||||
90 Day Turkish Lira Put option (strike price 1.356), expiring May 2008 | 1,392,000 | 149,585 | ||||||
Brazilian Real Put option (strike price 2.00), expiring May 2008 | 1,347,000 | 50,453 | ||||||
Swiss Franc Put option (strike price 1.185), expiring March 2008 | 8,725,000 | 290,263 | ||||||
Total Options Purchased (Cost $827,245) | 1,019,095 | |||||||
Securities Held As Collateral For Securities On Loan (5.9%) | ||||||||
Principal Amount | Value | |||||||
Morgan Stanley Repurchase Agreement, 5.42%, dated 06/29/07, due 07/02/07, repurchase price $13,925,399, collateralized by U.S. Government Agency Mortgages with a market value of $14,197,494 | $ | 13,919,112 | $ | 13,919,112 | ||||
Total Investments (Cost $246,766,265) (i) — 108.3% | 253,787,560 | |||||||
Liabilities in excess of other assets — (8.3)% | (19,386,429 | ) | ||||||
NET ASSETS — 100.0% | $ | 234,401,131 | ||||||
* | Denotes a non-income producing security. | |
(a) | Denotes a restricted security that may be resold without restriction to “qualified institutional buyers” as defined by Rule 144A under the Securities Act of 1933 and that the Fund has determined to be liquid under criteria established by the Fund’s Board of Trustees. | |
(b) | All or a part of the security was on loan as of June 30, 2007. | |
(c) | Variable Rate Security. The rate reflected in the Statement of Investments is the rate in effect on June 30, 2007. The maturity date represents the actual maturity date. | |
(d) | The rate reflected in the Statement of Investments is the effective yield as of June 30, 2007. | |
(e) | Illiquid security. | |
(f) | Security in default. | |
(g) | Fair Valued Security. | |
(h) | Mortgage Dollar Rolls | |
(i) | See notes to financial statements for tax unrealized appreciation (depreciation) of securities. |
Van Kampen NVIT Multi Sector Bond Fund (Continued)
CAD | Principal amount denominated in Canadian Dollar. | |
EUR | Principal amount denominated in Euro. | |
GBP | Principal amount denominated in British Pound. | |
IO | Interest Only (IO) bonds represent the “interest only” portion of payments on a pool of underlying mortgages or mortgage- backed securities. IO securities are subject to prepayment risk of the pool of underlying mortgages. | |
JPY | Principal amount denominated in Japanese Yen. | |
MXN | Principal amount denominated in Mexican Peso. | |
SEK | Principal amount denominated in Swedish Krone. | |
TBA | To Be Announced. |
At June 30, 2007, the Fund’s open forward foreign currency contracts against the United States Dollar were as follows:
Currency | Unrealized | |||||||||||||||||||
Date | Received/ | Contract | Market | Appreciation/ | ||||||||||||||||
Currency | Delivery | (Delivered) | Value | Value | (Depreciation) | |||||||||||||||
Short Contract: | ||||||||||||||||||||
Euro | 07/31/07 | (4,556,000 | ) | $ | (6,212,333 | ) | $ | (6,172,321 | ) | $ | 40,012 | |||||||||
Swedish Krone | 08/21/07 | (3,000,000 | ) | (440,938 | ) | (439,958 | ) | 980 | ||||||||||||
Total Short Contracts | $ | (6,653,271 | ) | $ | (6,612,279 | ) | $ | 40,992 | ||||||||||||
Long Contracts: | ||||||||||||||||||||
Japanese Yen | 07/09/07 | 710,000,000 | $ | 5,961,627 | $ | 5,774,207 | $ | (187,420 | ) | |||||||||||
Japanese Yen | 07/09/07 | 1,523,000,000 | 12,791,440 | 12,386,081 | (405,359 | ) | ||||||||||||||
Total Long Contracts | $ | 18,753,067 | $ | 18,160,288 | $ | (592,779 | ) | |||||||||||||
At June 30, 2007, the Fund’s open futures contracts were as follows:
Market Value | Unrealized | |||||||||||||||
Number of | Covered by | Appreciation | ||||||||||||||
Contracts | Long Contracts | Expiration | Contracts | (Depreciation) | ||||||||||||
2 | Japanese Gov’t Bond | 09/10/07 | $ | 2,144,586 | $ | (8,935 | ) | |||||||||
196 | U.S. 2 yr. Note Future | 09/28/07 | 39,941,125 | (66,102 | ) | |||||||||||
475 | U.S. 10 yr. Swap | 09/17/07 | 48,642,970 | (551,446 | ) | |||||||||||
597 | U.S. 10 yr. Note Future | 09/19/07 | 63,104,766 | (1,088,627 | ) | |||||||||||
202 | U.S. Treasury Bond | 08/24/07 | 21,023,781 | (197,190 | ) | |||||||||||
$ | 174,857,228 | $ | (1,912,300 | ) | ||||||||||||
Market Value | Unrealized | |||||||||||||||
Number of | Covered by | Appreciation | ||||||||||||||
Contracts | Long Contracts | Expiration | Contracts | (Depreciation) | ||||||||||||
550 | U.S. Treasury Bond | 09/22/07 | $ | (59,262,500 | ) | $ | 829,907 | |||||||||
$ | (59,262,500 | ) | $ | 827,907 | ||||||||||||
The following is a summary of written option activity for the period ended June 30, 2007, by the Fund (Dollar amount in thousands):
Covered Call Options | Contract | Premiums Received | ||||||||
Balance at beginning of period | 0 | $ | 0 | |||||||
Options written | 5,478 | 181 | ||||||||
Options expired | 0 | 0 | ||||||||
Options outstanding at end of period | 5,478 | 181 | ||||||||
At June 30, 2007, the Fund had the following outstanding written options:
WRITTEN OPTION CONTRACTS
Exercise | Number of | Premiums | ||||||||||||||||||||||
Contracts | Type | Expiration Date | Price | Contracts | Received | Value | ||||||||||||||||||
Brazilian Real | Put | May 2008 | 2.25 | 2,694 | 43,778 | 32,764 | ||||||||||||||||||
Turkish Lira | Put | May 2008 | 1.5215 | 2,784 | 137,390 | 132,675 | ||||||||||||||||||
Net Unrealized Appreciation on Written Option Contracts | ||||||||||||||||||||||||
[Additional columns below]
[Continued from above table, first column(s) repeated]
Unrealized | ||||||
Appreciation | ||||||
Contracts | (Depreciation) | |||||
Brazilian Real | $ | (11,014 | ) | |||
Turkish Lira | (4,715 | ) | ||||
Net Unrealized Appreciation on Written Option Contracts | $ | (15,729 | ) | |||
See accompanying notes to financial statements.
Van Kampen NVIT | ||||||
Multi Sector | ||||||
Bond Fund | ||||||
Assets: | ||||||
Investments, at value (cost $231,812,783)* | $ | 238,834,078 | ||||
Repurchase agreements, at cost and value | 14,953,482 | |||||
Total Investments | 253,787,560 | |||||
Cash | 83,016 | |||||
Deposits with brokers for futures | 322,136 | |||||
Interest and dividends receivable | 2,660,998 | |||||
Receivable for capital shares issued | 51,106 | |||||
Receivable for investments sold | 4,947,094 | |||||
Unrealized appreciation on futures contracts | 119,829 | |||||
Unrealized appreciation on forward foreign currency contracts | 40,992 | |||||
Reclaims receivable | 7,031 | |||||
Receivable for variation margin on futures contracts | 143,346 | |||||
Prepaid expenses | 2,918 | |||||
Total Assets | 262,166,026 | |||||
Liabilities: | ||||||
Call options written, at value (premiums received $181,168) | 165,439 | |||||
Foreign currencies payable to custodian, at value (Cost $120,050) | 119,290 | |||||
Payable for investments purchased | 12,647,218 | |||||
Unrealized depreciation on forward foreign currency contracts | 592,779 | |||||
Payable upon return of securities loaned | 13,919,112 | |||||
Payable for capital shares redeemed | 91,852 | |||||
Accrued expenses and other payables: | ||||||
Investment advisory fees | 143,953 | |||||
Fund administration and transfer agent fees | 24,452 | |||||
Administrative servicing fees | 15,627 | |||||
Compliance program costs | 3,218 | |||||
Other | 41,955 | |||||
Total Liabilities | 27,764,895 | |||||
Net Assets | $ | 234,401,131 | ||||
Represented by: | ||||||
Capital | $ | 228,353,233 | ||||
Accumulated net investment income | 1,041,947 | |||||
Accumulated net realized losses from investment transactions, futures, options and foreign currency transactions | (406,267 | ) | ||||
Net unrealized appreciation on investments, futures, options and translation of assets and liabilities denominated in foreign currencies | 5,412,218 | |||||
Net Assets | $ | 234,401,131 | ||||
Net Assets: | ||||||
Class I Shares | $ | 234,401,131 | ||||
Shares outstanding (unlimited number of shares authorized): | ||||||
Class I Shares | 24,072,574 | |||||
Net asset value and offering price per share (Net assets by class divided by shares outstanding by class, respectively.): | ||||||
Class I Shares | $ | 9.74 | ||||
* | Includes value of securities on loan of $30,997,095. |
20
Van Kampen NVIT | |||||
Multi Sector | |||||
Bond Fund | |||||
INVESTMENT INCOME: | |||||
Interest income | $ | 6,042,271 | |||
Dividend income | 15,862 | ||||
Income from securities lending | 17,801 | ||||
Total Income | 6,075,934 | ||||
Expenses: | |||||
Investment advisory fees | 884,173 | ||||
Fund administration and transfer agent fees | 100,490 | ||||
Administrative servicing fees Class I Shares | 162,679 | ||||
Custodian fees | 696 | ||||
Trustee fees | 5,597 | ||||
Compliance program costs (Note 3) | 1,660 | ||||
Other | 40,697 | ||||
Total expenses before earnings credit | 1,195,992 | ||||
Earnings credit (Note 6) | (348 | ) | |||
Net Expenses | 1,195,644 | ||||
Net Investment Income | 4,880,290 | ||||
REALIZED/ UNREALIZED GAINS (LOSSES) FROM INVESTMENTS: | |||||
Net realized gains on investment transactions | 1,660,051 | ||||
Net realized losses on futures transactions | (806,726 | ) | |||
Net realized losses on option transactions | (61,347 | ) | |||
Net realized losses on foreign currency transactions | (1,307,818 | ) | |||
Net realized losses on investment transactions, futures, options and foreign currency transactions | (515,840 | ) | |||
Net change in unrealized depreciation on investments, futures, options and translation of assets and liabilities denominated in foreign currencies | (1,844,180 | ) | |||
Net realized/unrealized gains (losses) on investments, futures, options and translation of assets and liabilities denominated in foreign currencies | (2,360,020 | ) | |||
CHANGE IN NET ASSETS RESULTING FROM OPERATIONS | $ | 2,520,270 | |||
21
Van Kampen NVIT | |||||||||
Multi Sector Bond Fund | |||||||||
Six Months Ended | Year Ended | ||||||||
June 30, 2007 | December 31, 2006 | ||||||||
(Unaudited) | |||||||||
FROM INVESTMENT ACTIVITIES: | |||||||||
Operations: | |||||||||
Net investment income | $ | 4,880,290 | $ | 10,526,982 | |||||
Net realized losses on investment transactions, futures, options and foreign currency transactions | (515,840 | ) | (261,147 | ) | |||||
Net change in unrealized appreciation/depreciation on investments, futures, options and translation of assets and liabilities denominated in foreign currencies | (1,844,180 | ) | 990,904 | ||||||
Change in net assets resulting from operations | 2,520,270 | 11,256,739 | |||||||
Distributions to shareholders from: | |||||||||
Net investment income: | |||||||||
Class I | (4,140,972 | ) | (9,963,083 | ) | |||||
Net realized gains: | |||||||||
Class I | (11,962 | ) | (554,113 | ) | |||||
Change in net assets from shareholder distributions | (4,152,934 | ) | (10,517,196 | ) | |||||
Change in net assets from capital transactions | (4,993,415 | ) | (18,670,729 | ) | |||||
Change in net assets | (6,626,079 | ) | (17,931,186 | ) | |||||
Net Assets: | |||||||||
Beginning of period | 241,027,210 | 258,958,396 | |||||||
End of period | $ | 234,401,131 | $ | 241,027,210 | |||||
Accumulated net investment income at end of period | $ | 1,041,947 | $ | 302,629 | |||||
CAPITAL TRANSACTIONS: | |||||||||
Class I Shares | |||||||||
Proceeds from shares issued | $ | 19,386,142 | $ | 25,985,872 | |||||
Dividends reinvested | 4,152,889 | 10,517,150 | |||||||
Cost of shares redeemed (a) | (28,532,446 | ) | (55,173,751 | ) | |||||
Change in net assets from capital transactions | $ | (4,993,415 | ) | $ | (18,670,729 | ) | |||
SHARE TRANSACTIONS: | |||||||||
Class I Shares | |||||||||
Issued | 1,960,835 | 2,653,323 | |||||||
Reinvested | 423,191 | 1,080,579 | |||||||
Redeemed | (2,893,027 | ) | (5,639,901 | ) | |||||
Total change in shares | (509,001 | ) | (1,905,999 | ) | |||||
(a) | Includes redemption fees, if any. |
22
Distributions | ||||||||||||||||||||
Investment Activities | ||||||||||||||||||||
Net Realized | ||||||||||||||||||||
and | ||||||||||||||||||||
Net Asset | Unrealized | Total | ||||||||||||||||||
Value, | Net | Gains | from | Net | ||||||||||||||||
Beginning | Investment | (Losses) on | Investment | Investment | ||||||||||||||||
of Period | Income | Investments | Activities | Income | ||||||||||||||||
Class I Shares | ||||||||||||||||||||
For the year ended December 31, 2002 | $ | 9.14 | 0.42 | 0.22 | 0.64 | (0.50 | ) | |||||||||||||
For the year ended December 31, 2003 | $ | 9.28 | 0.36 | 0.74 | 1.10 | (0.52 | ) | |||||||||||||
For the year ended December 31, 2004 | $ | 9.86 | 0.42 | 0.21 | 0.63 | (0.49 | ) | |||||||||||||
For the year ended December 31, 2005 | $ | 10.00 | 0.42 | (0.20 | ) | 0.22 | (0.39 | ) | ||||||||||||
For the year ended December 31, 2006 | $ | 9.78 | 0.43 | 0.02 | 0.45 | (0.40 | ) | |||||||||||||
For the six months ended June 30, 2007 (Unaudited) | $ | 9.81 | 0.20 | (0.10 | ) | 0.10 | (0.17 | ) | ||||||||||||
[Additional columns below]
[Continued from above table, first column(s) repeated]
Distributions | Ratios/Supplemental Data | |||||||||||||||||||||||
Net | Net Assets | Ratio of | ||||||||||||||||||||||
Realized | Net Asset | at End of | Expenses | |||||||||||||||||||||
Gains | Total | Value, End | Total | Period | to Average | |||||||||||||||||||
(Losses) | Distributions | of Period | Return (a) | (000s) | Net Assets (b) | |||||||||||||||||||
Class I Shares | ||||||||||||||||||||||||
For the year ended December 31, 2002 | – | (0.50 | ) | $ | 9.28 | 7.21% | $ | 209,280 | 1.01% | |||||||||||||||
For the year ended December 31, 2003 | – | (0.52 | ) | $ | 9.86 | 12.12% | $ | 226,525 | 1.01% | |||||||||||||||
For the year ended December 31, 2004 | – | (0.49 | ) | $ | 10.00 | 6.53% | $ | 238,502 | 1.01% | |||||||||||||||
For the year ended December 31, 2005 | (0.05 | ) | (0.44 | ) | $ | 9.78 | 2.18% | $ | 258,958 | 1.03% | ||||||||||||||
For the year ended December 31, 2006 | (0.02 | ) | (0.42 | ) | $ | 9.81 | 4.84% | $ | 241,027 | 1.02% | ||||||||||||||
For the six months ended June 30, 2007 (Unaudited) | –(e | ) | (0.17 | ) | $ | 9.74 | 1.03% | $ | 234,401 | 1.00% | ||||||||||||||
[Additional columns below]
[Continued from above table, first column(s) repeated]
Ratios/Supplemental Data | ||||||||||||||||||
Ratio of Net | ||||||||||||||||||
Ratio of Net | Ratio of | Investment | ||||||||||||||||
Investment | Expenses | Income | ||||||||||||||||
Income | (Prior to | (Prior to | ||||||||||||||||
to Average | Reimbursements) | Reimbursements) | ||||||||||||||||
Net | to Average | to Average | Portfolio | |||||||||||||||
Assets (b) | Net Assets (b)(c) | Net Assets (b)(c) | Turnover | |||||||||||||||
Class I Shares | ||||||||||||||||||
For the year ended December 31, 2002 | 4.61% | 1.02% | 4.60% | 385.94% | ||||||||||||||
For the year ended December 31, 2003 | 3.75% | (d) | (d) | 296.62% | ||||||||||||||
For the year ended December 31, 2004 | 4.23% | (d) | (d) | 212.84% | ||||||||||||||
For the year ended December 31, 2005 | 4.26% | (d) | (d) | 157.82% | ||||||||||||||
For the year ended December 31, 2006 | 4.24% | (d) | (d) | 100.56% | ||||||||||||||
For the six months ended June 30, 2007 (Unaudited) | 4.09% | 1.00% | 4.09% | 44.33% | ||||||||||||||
(a) | Not annualized for periods less than one year. | |
(b) | Annualized for periods less than one year. | |
(c) | During the period, certain fees were waived and/or reimbursed. If such waivers/reimbursements had not occurred, the ratios would have been as indicated. | |
(d) | There were no fee reductions during the period. | |
(e) | The amount is less than $0.01. |
See accompanying notes to financial statements.
1. Organization
Nationwide Variable Insurance Trust (“NVIT” or the “Trust”) is an open-end management investment company, organized under the laws of Delaware by an amended and restated Agreement and Declaration of Trust, dated October 28, 2004, as amended to date. Prior to May 1, 2007, the Trust was named “Gartmore Variable Insurance Trust”. The Trust, originally created under the laws of Massachusetts as a Massachusetts business trust pursuant to a Declaration of Trust dated, as of June 30, 1981, and as subsequently amended, redomesticated as a Delaware Statutory Trust after the close of trading on April 29, 2005, and is registered under the Investment Company Act of 1940, as amended (the “1940 Act”). The redomestication was a change in statutory status and did not affect the operations of the Trust. As of June 30, 2007, the Trust had authorized an unlimited number of shares of beneficial interest, without par value (“shares”). The Trust currently offers shares to life insurance company separate accounts to fund the benefits under variable life insurance or annuity policies. To date, only the separate accounts of Nationwide Life Insurance Company and Nationwide Life and Annuity Insurance Company (collectively, “Nationwide”) have purchased shares of the Van Kampen NVIT Multi Sector Bond Fund (the “Fund”), (formerly, “Van Kampen GVIT Multi Sector Bond Fund”). The Trust currently operates forty (40) separate series, or mutual funds, each with its own investment objectives and strategies. This report contains the financial statements and financial highlights of the Fund.
2. Summary of Significant Accounting Policies
The following is a summary of significant accounting policies followed by the Fund in the preparation of its financial statements. The policies are in conformity with accounting principles generally accepted in the United States of America (“GAAP”). The preparation of financial statements requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of income and expenses for the period. Actual results could differ from those estimates.
(a) | Security Valuation |
Securities for which market quotations are readily available are valued at current market value as of “Valuation Time.” Valuation Time is as of the close of regular trading on the New York Stock Exchange (usually 4 p.m. Eastern time). Equity securities are valued at the last quoted sale price or, if there is no sale price, the last quoted bid price provided by an independent pricing service approved by the Trust’s Board of Trustees (“Board of Trustees”). Securities traded on NASDAQ are valued at the NASDAQ official closing price. Prices are taken from the primary market or exchange in which each security trades. | |
Most securities listed on a foreign exchange are valued either at fair value (see description below) or at the last sale price at the close of the exchange on which the security is principally traded. Foreign securities, currencies, and other assets and liabilities denominated in foreign currencies are translated into U.S. dollars at the exchange rate of said currencies against the U.S. dollar, as of Valuation Time, as provided by an independent pricing service approved by the Board of Trustees. | |
Debt (including defaulted issues) and other fixed income securities (other than short-term obligations) are valued at the last quoted bid price and/or by using a combination of daily quotes and matrix evaluations provided by an independent pricing service, the use of which has been approved by the Board of Trustees. Short-term debt securities, such as commercial paper and U.S. Treasury Bills having a remaining maturity of 60 days or less at the time of purchase, are considered to be “short-term” and are valued at amortized cost, which approximates market value. | |
Securities for which market quotations are not readily available, or for which an independent pricing service does not provide a value or provides a value that does not represent fair value in the judgment of the Fund’s investment adviser or designee, are valued at fair value under procedures approved by the Board of Trustees. The “Fair Value” of these securities is determined in good faith by taking into account relevant factors and surrounding circumstances. Methods utilized to obtain a “Fair Value” may include the following non-exclusive list of acceptable methods: (i) a multiple of earnings; (ii) the discount from market value of a similar, freely traded security; (iii) the yield-to-maturity |
for debt issues; or (iv) a consolidation of the methods. The Trust’s Valuation & Operations Committee considers a non-exclusive list of factors to arrive at the appropriate method of determining “Fair Value.” For example, fair value determinations are required for securities whose value is affected by a “significant” event that materially affects the value of a domestic or foreign security which occurs subsequent to the time of the close of the principal market on which such domestic or foreign security trades and before the Valuation Time (i.e., a “subsequent event”). Typically, this will involve events occurring after the close of a foreign market on which a security trades and before the next Valuation Time. | |
The Fund values foreign securities at fair value in the circumstances described below. Generally, trading in foreign securities markets is completed each day at various times prior to the Valuation Time. Due to the time differences between the closings of the relevant foreign securities exchanges and the Valuation Time for the Fund, the Fund will fair value its foreign investments when it is determined that the market quotations for the foreign investments either are not readily available or are unreliable and, therefore, do not represent fair value. When the fair value prices are utilized, these prices will attempt to reflect the impact of the U.S. financial markets’ perceptions and trading activities on the Fund’s foreign investments since the last closing prices of the foreign investments were calculated on their primary foreign securities markets or exchanges. For these purposes, the Board of Trustees has determined that movements in relevant indices or other appropriate market indicators, after the close of the foreign securities exchanges, may demonstrate that market quotations are unreliable, and may trigger fair value pricing for certain securities. Consequently, fair valuation of portfolio securities may occur on a daily basis. |
(b) | Repurchase Agreements |
The Fund may enter into repurchase agreements with an entity which is a member of the Federal Reserve System or which is a “primary dealer” (as designated by the Federal Reserve Bank of New York) in U.S. Government obligations. The repurchase price generally equals the price paid by the Fund plus interest negotiated on the basis of current short-term rates, which may be more or less than the rate on the underlying portfolio securities. The seller under a repurchase agreement is required to maintain the value of the collateral held pursuant to the agreement at a market value equal to or greater than the repurchase price (including accrued interest). Collateral subject to repurchase agreements is held by the Fund’s custodian or another qualified sub-custodian or in the Federal Reserve/ Treasury book-entry system. If the counterparty defaults and the fair value of the collateral declines, realization of the collateral by the Fund may be delayed or limited. The Fund may transfer uninvested cash balances into a pooled cash account. These balances are invested in one or more repurchase agreements, with the counterparty of Nomura Securities, which is fully collateralized by U.S. Government Agency Mortgages. |
(c) | Foreign Currency Transactions |
The accounting records of the Fund are maintained in U.S. dollars. Foreign currency amounts are translated into U.S. dollars at the current rate of exchange to determine the value of investments, assets and liabilities. The Fund may enter into foreign currency contracts in connection with purchases or sales of securities denominated in a foreign currency. Purchases and sales of securities, and income and expenses, are translated at the prevailing rate of exchange on the respective date of these transactions. The Fund does not isolate that portion of the results of operations resulting from changes in foreign exchange rates on investments from fluctuations arising from changes in market prices of securities held. These fluctuations are included with the net realized and unrealized gain or loss from investments and foreign currencies. |
(d) | Forward Foreign Currency Contracts |
The Fund may enter into forward foreign currency contracts in connection with planned purchases or sales of securities or to hedge the U.S. dollar value of portfolio securities denominated in a particular currency. The Fund could be exposed to risks if the counterparties to the contracts are unable to meet the terms of their contracts and from unanticipated movements in the value of a foreign currency relative to the U.S. dollar. Forward foreign currency contracts are valued at the current cost of covering these contracts, as provided by an independent pricing service |
approved by the Board of Trustees. The forward foreign currency contracts are adjusted by the daily exchange rate of the underlying currency and any gains or losses are recorded for financial statement purposes as unrealized gains or losses until the contract settlement date. |
(e) | Futures Contracts |
The Fund may invest in financial futures contracts (“futures contracts”) for the purpose of hedging its existing portfolio securities or securities that the Fund intends to purchase against fluctuations in value caused by changes in prevailing market interest rates or prices. Futures contracts may also be entered into for non-hedging purposes. | |
Upon entering into a futures contract, the Fund is required to pledge to the broker an amount of cash and/or other assets equal to a certain percentage of the contract amount (initial margin deposit). Subsequent payments, known as “variation margin,” are made each day, depending on the daily fluctuations in the fair value/market value of the underlying assets. A gain or loss equal to the daily variation margin is recognized on a daily basis. Futures contracts are valued daily at their last quoted sale price. | |
A “sale” of a futures contract means the creation of a contractual obligation to deliver the securities or foreign currency called for by the contract at a fixed price at a specified time in the future. A “purchase” of a futures contract means the creation of a contractual obligation to acquire the securities or foreign currency at a fixed price at a specified time in the future. | |
Should market conditions change unexpectedly, the Fund may not achieve the anticipated benefits of the futures contracts and may realize a loss. The use of futures transactions for hedging purposes involves the risk of imperfect correlation in movements in the price of futures contracts, interest rates, and the value of the underlying hedged assets. |
(f) | Written Options Contracts |
The Fund may write options contracts. A written option obligates the Fund to deliver (written call) or to receive (written put) a specified quantity of an underlying asset at the contract amount upon exercise by the holder of the option. When the Fund writes an option, an amount equal to the premium received by the Fund is recorded as a liability and is subsequently adjusted to the current fair value of the option written. Premiums received from writing options that expire unexercised are treated by the Fund on the expiration date as realized gains from investments. The difference between the premium and the amount paid on effecting a closing purchase transaction, as a realized loss. If a call option is exercised, the premium is added to the proceeds from the sale of the underlying security or currency in determining whether the Fund has realized a gain or loss. If a put option is exercised, the premium reduces the cost basis of the securities purchased by the Fund. Options traded on an exchange are valued at the last quoted sale price, or in the absence of a sale, the bid price provided by an independent pricing service approved by the Board of Trustees. Non-exchange traded options are valued using dealer supplied quotes. The Fund as a writer of an option bears the market risk of an unfavorable change in the price of the security underlying the written option. |
(g) | Mortgage Dollar Rolls |
The Fund may enter into mortgage “dollar rolls” in which the Fund sells mortgage-backed securities for delivery in the current month and simultaneously contracts to repurchase substantially similar (same type, coupon, and maturity) securities on a specified future date. Mortgage dollar rolls may be implemented in the “to be announced” (“TBA”) market and are referred to as TBAs on the Statement of Investments of the Fund. During the roll period, the Fund foregoes principal and interest paid on the mortgage-backed securities. Each mortgage dollar roll is treated as a financing transaction; therefore, any gain or loss is considered unrealized until the roll reaches completion. Risks may arise due to the delayed payment date and the potential inability of counterparties to complete the transaction. Income is generated as consideration for entering into these transactions and is included in interest income on the Statement of Operations. |
(h) | Security Transactions and Investment Income |
Security transactions are accounted for on the date the security is purchased or sold (“trade date”). Securities gains and losses are calculated on the identified cost basis. Interest income is recognized on the accrual basis and includes, where applicable, the amortization or accretion of premium or discount. Dividend income is recorded on the ex-dividend date. |
(i) | Securities Lending |
To generate additional income, the Fund may lend its portfolio securities, up to 33 1/3% of the Fund, to brokers, dealers and other financial institutions provided that (1) the borrower delivers cash or securities as collateral with respect to each new loan of U.S. securities, equal to at least 102% of the value of the portfolio securities loaned, and with respect to each new loan on non-U.S. securities, collateral of at least 105% of the value of the portfolio securities loaned; and (2) at all times thereafter shall require the borrower to mark-to-market the collateral on a daily basis so that the market value of such collateral does not fall below 100% of the value of securities loaned. The Fund receives payments from borrowers equivalent to the dividends and interest that would have been earned on securities loaned while simultaneously seeking to earn income on the investment of cash collateral. There may be risks of delay in recovery of the securities should the borrower of the securities fail financially. Loans will be made, however, only to borrowers deemed by the Fund’s investment adviser to be of good standing and creditworthy under guidelines established by the Board of Trustees and when, in judgment of the adviser, the consideration which can be earned currently from these securities loans justifies the attendant risks. Loans are subject to termination by the Fund or the borrower at any time, and, therefore, are not considered to be illiquid investments. JPMorgan Chase Bank serves as custodian for the securities lending program of the Fund. JPMorgan Chase Bank receives a fee based on the value of the collateral received from borrowers. | |
Information on the investment of cash collateral is shown in the Statement of Investments. | |
As of June 30, 2007, the Fund had securities with the following value on loan: |
Value of | ||||||
Value of Loaned Securities | Collateral | |||||
$30,997,095 | $ | 31,531,050* | ||||
* | Includes $17,611,938 of collateral in the form of U.S. Government Securities, interest rates ranging from 0.00% to 9.00%, and maturity dates ranging from 09/14/07 to 02/15/36. |
(j) | Distributions to Shareholders |
The Fund’s dividends from net investment income, if any, are declared and paid quarterly. The Fund’s distributions from net realized capital gains, if any, are declared and distributed at least annually. | |
Dividends and distributions to shareholders are determined in accordance with federal income tax regulations, which may differ from GAAP. These “book/tax” differences are considered either permanent or temporary in nature. In accordance with the American Institute of Certified Public Accountants Statement of Position 93-2, permanent differences (i.e., reclassification of market discounts, foreign exchange gain/loss, paydowns, and distributions from real estate investment trusts) are reclassified within the capital accounts based on their nature for federal income tax purposes; temporary differences do not require reclassification. These reclassifications have no effect upon the net asset value of the Fund. To the extent distributions exceed current and accumulated earnings and profits for federal income tax purposes, these distributions are reported as distributions of paid-in-capital. |
(k) | Federal Income Taxes |
It is the policy of the Fund to qualify or to continue to qualify as a “regulated investment company” by complying with the provisions available to certain investment companies, as defined in Subchapter M of the U.S. Internal |
Revenue Code, and to make distributions of net investment income and net realized capital gains sufficient to relieve the Fund from all, or substantially all, federal income taxes. | |
As of June 30, 2007, the tax cost of securities and the breakdown of unrealized appreciation (depreciation) for the Fund was as follows: |
Net | ||||||||||||||||
Unrealized | ||||||||||||||||
Tax Cost of | Unrealized | Unrealized | Appreciation | |||||||||||||
Securities | Appreciation | Depreciation | (Depreciation) | |||||||||||||
$ | 246,915,510 | $ | 9,229,048 | $ | (2,356,998 | ) | $ | 6,872,050 | ||||||||
(l) | Allocation of Expenses, Income, and Gains and Losses |
Expenses directly attributable to the Fund are charged to the Fund. Expenses not directly attributable to the Fund are allocated proportionately among various or all funds within the Trust. The method used by the Fund for allocating income, fund level expenses, and realized and unrealized gains or losses is based on the fair value of shares outstanding relative to net assets. Under this method, each class of shares participates based on the total net asset value of that class’s shares in proportion to the total net assets of the Fund. Expenses specific to a class (such as Rule 12b-1 and administrative services fees) are charged to that class. |
3. Transactions with Affiliates
Under the terms of the Trust’s Investment Advisory Agreement, Nationwide Fund Advisors (formerly, Gartmore Mutual Fund Capital Trust (“GMF”)) (“NFA” or the “Advisor”) manages the investment of the assets and supervises the daily business affairs of the Fund. NFA is a wholly-owned subsidiary of Nationwide Financial Services (“NFS”). In addition, NFA provides investment management evaluation services in initially selecting and monitoring, on an ongoing basis, the performance of the subadviser for the Fund. Morgan Stanley Investment Management, Inc. (the “subadviser”), manages all of the Fund’s investments and has the responsibility for making all investment decisions for the Fund.
Under the terms of the Investment Advisory Agreement, the Fund pays NFA an investment advisory fee based on that Fund’s average daily net assets. Additional information regarding investment advisory fees and subadvisory fees for NFA and the subadviser is as follows for the six months ended June 30, 2007:
Total | ||||||
Fee Schedule | Fees | |||||
Up to $200 million | 0.75% | |||||
$200 million or more | 0.70% | |||||
From such fees, pursuant to the subadvisory agreement, NFA paid the subadviser $347,655 for the six months ended June 30, 2007.
Under the terms of a Fund Administration and Transfer Agency Agreement, Nationwide Fund Management, LLC (formerly, Gartmore Investor Services, Inc. (“GISI”)) (“NFM”), a wholly-owned subsidiary of NFS Distributors, Inc. (“NFSDI”), provides the Fund with various administrative and accounting services for the Fund (prior to May 1, 2007, this service was provided by Gartmore SA Capital Trust (“GSA”)), and serves as Transfer and Dividend Disbursing Agent for the Fund (prior to May 1, 2007, this service was provided by GISI, an indirect subsidiary of GSA). The fees for the services provided under this Agreement are calculated based on the Trust’s average daily net assets according to the fee
Combined Fee Schedule* | ||||||
Up to $1 billion | 0.15% | |||||
$1 billion up to $3 billion | 0.10% | |||||
$3 billion up to $8 billion | 0.05% | |||||
$8 billion up to $10 billion | 0.04% | |||||
$10 billion up to $12 billion | 0.02% | |||||
$12 billion or more | 0.01% | |||||
* | The assets of the Nationwide NVIT Investor Destinations Aggressive Fund, the Nationwide NVIT Investor Destinations Moderately Aggressive Fund, the Nationwide NVIT Investor Destinations Moderate Fund, the Nationwide NVIT Investor Destinations Moderately Conservative Fund, and the Nationwide NVIT Investor Destinations Conservative Fund (collectively, the “Investor Destinations Funds”) are excluded from the Trust asset level amount in order to calculate this asset-based fee. The Investor Destinations Funds do not pay any part of this fee. |
NFA and NFM have entered into agreements with Citi Fund Services Ohio, Inc. (“Citi”), pursuant to which Citi provides sub-administration and sub-transfer agency services, respectively, to the Fund. Effective August 1, 2007, The BISYS Group Inc. was acquired and became a wholly owned subsidiary of Citi.
Under the terms of an Administrative Services Plan, the Fund may pay fees to servicing organizations, such as broker-dealers, including NFS, and financial institutions, which agree to provide administrative support services to the shareholders of certain classes. These services include, but are not limited, to the following: establishing and maintaining shareholder accounts; processing purchase and redemption transactions; arranging bank wires; performing shareholder sub-accounting; answering inquires regarding the Fund; and other such services. These fees are based on an annual rate of up to 0.25% of the average daily net assets of each class of shares of the Fund.
For the six months ended June 30, 2007, NFS received $178,799 in Administrative Services Fees from the Fund.
Under the terms of a letter agreement dated September 12, 2006, by and among NFA, the Audit Committee of the Trust and the Trust, the Trust has agreed to reimburse NFA certain costs related to the Fund’s portion of ongoing administration, monitoring and annual (audit) testing of the Trust’s Rule 38a-1 Compliance Program subject to the pre-approval of the Trust’s Audit Committee. For the six months ended June 30, 2007, the Fund’s portion of such costs amounted to $1,660.
4. Investment Transactions
For the six months ended June 30, 2007, (excluding short-term securities) the Fund had purchases of $110,936,244 and sales of $100,335,431.
For the six months ended June 30, 2007, the Fund had purchases of $159,613,441 and sales of $86,946,194 of U.S. Government securities.
5. Bank Loans and Earnings Credit
The Trust has a credit agreement with JPMorgan Chase & Co., the Fund’s custodian bank, permitting the Trust to borrow up to $100,000,000. Borrowings under this arrangement bear interest at the Federal Funds rate plus 0.50%. The interest costs, if any, would be included in other fees in the Statement of Operations. No compensating balances were required under the terms of the line of credit. The line of credit is renewed annually, expiring on June 25, 2008, with a commitment fee of 0.07% per year on $100,000,000. There were no borrowings outstanding under this line of credit for the six months ended June 30, 2007.
The Trust’s custodian bank has agreed to reduce the bank’s fees (earnings credits) when the funds of the Trust maintain cash on deposit in non-interest-bearing custody and Demand Deposit Accounts. Earnings credits, if any, are shown as a reduction of total expenses on the Statement of Operations.
6. Portfolio Investment Risks
Risks Associated with Foreign Securities and Currencies. Investments in securities of foreign issuers carry certain risk not ordinarily associated with investments in securities of U.S. issuers. These risks include future political and economic developments, and the possible imposition of exchange controls or other foreign governmental laws and restrictions. In addition, with respect to certain countries, there is the possibility of expropriation of assets, confiscatory taxation, political or social instability, or diplomatic developments, which could adversely affect investments in those countries.
Certain countries also may impose substantial restrictions on investments in their capital markets by foreign entities, including restrictions on investments in issuers of industries deemed sensitive to relevant national interests. These factors may limit the investment opportunities available and result in a lack of liquidity and high price volatility with respect to securities of issuers from developing countries.
Credit and Market Risk. The Fund invests in emerging market instruments that are subject to certain additional credit and market risks. The yields of emerging market debt obligations reflect, among other things, perceived credit risk. The Fund’s investment in securities rated below investment grade typically involve risks not associated with higher rated securities including, among others, greater risk of not receiving timely and/or ultimate payment of interest and principal, greater market price volatility, and less liquid secondary market trading. The consequences of political, social, economic, or diplomatic changes may have disruptive effects on the market prices of emerging markets investments held by the Fund.
7. Indemnifications
Under the Trust’s organizational documents, certain of the Trust’s Officers and Trustees are indemnified against certain liabilities arising out of the performance of their duties to the Trust. In addition, the Trust has entered into Indemnification Agreements with the Trust’s trustees and certain officers covering similar liabilities. Trust Officers receive no compensation from the Trust for serving as the Trust’s Officers. In addition, in the normal course of business, the Trust enters into contracts with its vendors and others that provide for general indemnifications. The Trust’s maximum exposure under these arrangements is unknown, as this would involve future claims that may be made against the Trust. Based on experience, however, the Trust expects that risk of loss to be remote.
8. Recently Issued Accounting Pronouncements
On July 13, 2006, the Financial Accounting Standards Board (“FASB”) released FASB Interpretation No. 48, Accounting for Uncertainty in Income Taxes (“FIN 48”). FIN 48 provides guidance for how uncertain tax positions should be recognized, measured, presented and disclosed in the financial statements. FIN 48 requires the affirmative evaluation of tax positions taken or expected to be taken in the course of preparing the Fund’s tax returns to determine whether it is more-likely-than-not (i.e., greater than 50 percent) that each tax position will be sustained upon examination by a taxing authority based on the technical merits of the position. A tax position that meets the more-likely-than-not recognition threshold is measured to determine the amount of benefit to recognize in the financial statements. Differences between tax positions taken in a tax return and amounts recognized in the financial statements will generally result in an increase in a liability for taxes payable (or a reduction of a tax refund receivable) and an increase in a deferred tax liability (or a reduction in a deferred tax asset). Adoption of FIN 48 was required no later than the last business day of the first financial statement reporting period for fiscal years beginning after December 15, 2006 and is to be applied to all open tax years as of the effective date. Accordingly, the Fund was required to implement FIN 48 in its net asset value per share (NAV) calculation on June 29, 2007. Management has evaluated the implications of FIN 48 and has concluded that there was no impact to the Fund’s financial statements as of June 29, 2007. The adoption of FIN 48 requires ongoing monitoring and analysis, future conclusions reached by management may be different and result in adjustments to the Fund’s NAV and financial statements.
In September 2006, the FASB issued Statement on Financial Accounting Standards (“SFAS”) No. 157, “Fair Value Measurements.” This standard establishes a single authoritative definition of fair value, sets out a framework for measuring fair value and requires additional disclosures about fair value measurements. SFAS No. 157 applies to fair value measurements already required or permitted by existing standards. SFAS No. 157 is effective for financial statements issued for fiscal years beginning after November 15, 2007 and interim periods within those fiscal years. The changes to current accounting principles generally accepted in the United States of America from the application of this Statement relate to the definition of fair value, the methods used to measure fair value, and the expanded disclosures about fair value measurements. As of June 30, 2007, the Fund does not believe the adoption of SFAS No. 157 will impact the financial statement amounts; however, additional disclosures may be required about the inputs used to develop the measurements and the effect of certain of the measurements on changes in net assets for the period.
Trustees who are not Interested Persons (as defined in the 1940 Act) and Officers of the Trust as of
Number of Portfolios | ||||||||||
Position(s) Held | in the | |||||||||
with the Trust | Principal Occupation(s) | Nationwide Fund | Other | |||||||
Name, Address | and Length of | During Past | Complex Overseen | Directorships | ||||||
and Year of Birth | Time Served1 | Five Years | by Trustee | Held by Trustee2 | ||||||
Charles E. Allen c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1948 | Trustee since July 2000 | Mr. Allen is Chairman, Chief Executive Officer and President of Graimark Realty Advisors, Inc. (real estate development, investment and asset management). | 89 | None | ||||||
Paula H.J. Cholmondeley c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1947 | Trustee since July 2000 | Ms. Cholmondeley was Vice President and General Manager of Sappi Fine Paper North America from April 2000 through December 2003. | 89 | Director of Dentsply International, Inc. (dental products), Ultralife Batteries, Inc., Terex Corporation (construction equipment), Minerals Technology, Inc. (specialty chemicals) and Albany International Corp. (paper industry) | ||||||
C. Brent DeVore3 c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1940 | Trustee since 1990 | Dr. DeVore is President of Otterbein College. | 89 | None | ||||||
Phyllis Kay Dryden c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1947 | Trustee since December 2004 | Ms. Dryden was a partner of Mitchell Madison, a management consulting company from January 2006 until December 2006; she is currently a consultant with the company. Ms. Dryden was formerly Managing Partner of march FIRST, a global management consulting firm. | 89 | None | ||||||
Barbara L. Hennigar c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1935 | Trustee since July 2000 | Retired. | 89 | None | ||||||
Number of Portfolios | ||||||||||
Position(s) Held | in the | |||||||||
with the Trust | Principal Occupation(s) | Nationwide Fund | Other | |||||||
Name, Address | and Length of | During Past | Complex Overseen | Directorships | ||||||
and Year of Birth | Time Served1 | Five Years | by Trustee | Held by Trustee2 | ||||||
Barbara I. Jacobs c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1950 | Trustee since December 2004 | Ms. Jacobs served as Chairman of the Board of Directors of KICAP Network Fund, a European (United Kingdom) hedge fund, from January 2001 through January 2006. From 1998-2003, Ms. Jacobs was also a Managing Director and European Portfolio Manager of CREF Investments (Teachers Insurance and Annuity Association-College Retirement Equities Fund). | 89 | None | ||||||
Douglas F. Kridler c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1955 | Trustee since September 1997 | Mr. Kridler has served as the President and Chief Executive Officer of the Columbus Foundation (a Columbus, OH-based foundation which manages over 1,300 individual endowment funds) since February 2002. Prior to January 31, 2002, Mr. Kridler was the President of the Columbus Association for the Performing Arts and Chairman of the Greater Columbus Convention and Visitors Bureau. | 89 | None | ||||||
Michael D. McCarthy c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1947 | Trustee since December 2004 | Retired. Mr. McCarthy was Chairman of VMAC (commodity swaps) from October 2002 until January 2007; and a partner of Pineville Properties LLC (a commercial real estate development firm) from September 2000 until January 2007. | 89 | None | ||||||
David C. Wetmore c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1948 | Trustee since 1995 and Chairman since February 2005 | Retired. | 89 | None | ||||||
1 | Length of time served includes time served with the Trust’s predecessors. | |
2 | Directorships held in (1) any other investment companies registered under the 1940 Act, (2) any company with a class of securities registered pursuant to Section 12 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or (3) any company subject to the requirements of Section 15(d) of the Exchange Act. | |
3 | Mr. DeVore has served as President of Otterbein College since 1984. Mark Thresher, President and Chief Operating Officer of Nationwide Financial Services, Inc. (“NFS”) has served as a member of the Board of Trustees of Otterbein College since 2000, currently serves as one of 30 of its trustees, and is currently one of two Vice Chairmen of the Board. Each of Nationwide Fund Advisors (“NFA”), the Funds’ investment adviser, and Nationwide Fund Distributors LLC (“NFD”), principal underwriter to the Trust, is a wholly-owned subsidiary of NFS. | |
Additional information regarding the Trustees and Officers may be found in the Trust’s Statement of Additional Information, which is available without charge upon request, by calling 800-848-0920. |
Trustees who are Interested Persons (as defined in the 1940 Act) and/or Officers of the Trust as of
Number of Portfolios | ||||||||||
Position(s) Held | in the | |||||||||
with the Trust | Principal Occupation(s) | Nationwide Fund | Other | |||||||
Name, Address | and Length of | During Past | Complex Overseen | Directorships | ||||||
and Year of Birth | Time Served1 | 5 Years | by Trustee | Held by Trustee 2 | ||||||
Arden L. Shisler c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1941 | Trustee since February 2000 | Retired. Mr. Shisler is the former President and Chief Executive Officer of KeB Transport, Inc., a trucking firm (2000 through 2002). He served as a consultant to KeB from January 2003 through December 2004. Since 1992, Mr. Shisler has also been Chairman of the Board for Nationwide Mutual Insurance Company.3 | 89 | Director of Nationwide Financial Services, Inc., Chairman of Nationwide Mutual Insurance Company3 | ||||||
John H. Grady Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1961 | President & Chief Executive Officer since December 2006 | Mr. Grady is President, and Chief Executive Officer of Nationwide Funds Group which includes Nationwide Fund Advisors,3 Nationwide Fund Management LLC,3 Nationwide Fund Distributors LLC 3 and NWD Investments,2 the asset management operations of Nationwide Mutual Insurance Company, which includes Morley Capital Management, Inc.,2 Nationwide Separate Accounts LLC,2 NorthPointe Capital LLC,2 and Nationwide SA Capital Trust2. From March 2004 until March 2006, Mr. Grady was Chief Executive Officer of Constellation Investment Management Co., L.P. (registered investment adviser), and President and Chief Executive Officer of Constellation Funds Group (registered investment companies). He also was President of Constellation Investment Distribution Co., Inc. (registered broker-dealer) from March 2004 until June 2006. From February 2001 until February 2004, Mr. Grady was Chief Operating and Chief Legal Officer; Managing Director, Mutual Funds Group, Turner Investment Partners, Inc. (registered investment adviser); Executive Vice President of Turner Funds and Turner Institutional Portfolios (registered investment companies); and President, Turner Investment Distributors, Inc. (registered broker-dealer). | N/A | None | ||||||
Gerald J. Holland Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1951 | Treasurer since March 2001 | Mr. Holland is Senior Vice President—Operations for Nationwide Funds Group3. | N/A | N/A | ||||||
Number of Portfolios | ||||||||||
Position(s) Held | in the | |||||||||
with the Trust | Principal Occupation(s) | Nationwide Fund | Other | |||||||
Name, Address | and Length of | During Past | Complex Overseen | Directorships | ||||||
and Year of Birth | Time Served1 | 5 Years | by Trustee | Held by Trustee 2 | ||||||
Michael A. Krulikowski Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1959 | Chief Compliance Officer from June 2004 to August 20074 | Mr. Krulikowski is Vice President and Chief Compliance Officer of Nationwide Funds Group3, Morley Capital Management, Inc.3, Nationwide SA Capital Trust (since 1999)3, and Nationwide Separate Accounts LLC (since August 2005).3 Since June 2004, Mr. Krulikowski has also served as Chief Compliance Officer of the Trust. From November 1999 through May 2007, he served as Vice President and Chief Compliance Officer of NorthPointe Capital LLC. 3 | N/A | N/A | ||||||
Eric E. Miller Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1953 | Secretary since December 2002 | Mr. Miller is Senior Vice President, General Counsel, and Assistant Secretary for Nationwide Funds Group3 and NWD Investments.2 From August 2000 to August 2002, Mr. Miller was a Partner with Stradley Ronon Stevens & Young, LLP. | N/A | N/A | ||||||
1 | Length of time served includes time served with the Trust’s predecessors. | |
2 | Directorships held in (1) any other investment companies registered under the 1940 Act, (2) any company with a class of securities registered pursuant to Section 12 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or (3) any company subject to the requirements of Section 15(d) of the Exchange Act. | |
3 | This position is held with an affiliated person or principal underwriter of the Trust. | |
4 | Effective August 3, 2007, the Board of Trustees approved Carol Baldwin Moody as Chief Compliance Officer of the Trust. Since November 2005, Ms. Moody has been Senior Vice President, Chief Compliance Officer of Nationwide Financial Services, Nationwide Life Insurance Company, Nationwide Life and Annuity Insurance Company, and Nationwide Investment Advisors, LLC. From February 2004-November 2005, she was Chief Compliance Officer of TIAA-CREF and from April 2000-February 2004, she was Managing Director and General Counsel, TCW/ Latin America Partners, LLC and Baeza & Co., LLC. | |
Federal law requires the Trust, each of its investment advisers and sub-advisers to adopt procedures for voting proxies (“Proxy Voting Guidelines”) and to provide a summary of those Proxy Voting Guidelines used to vote the securities held by the Funds. The Funds’ proxy voting policies and procedures are available without charge (i) upon request, by calling 800-848-0920, (ii) on the Funds’ website at www.nationwidefunds.com, or (iii) on the Securities and Exchange Commission’s website at www.sec.gov. |
A. Renewal of Investment Advisory Agreement
(i) | General Information Regarding the Board’s Review of Investment Advisory Agreements |
The Trust’s investment advisory agreements (each an “Advisory Agreement”) with its investment adviser and, as applicable, sub-advisers (together, the “Adviser”) must be approved for an initial term no greater than two years, and renewed at least annually thereafter, (i) by the vote of the Trustees or by a vote of the shareholders of each series or fund of the Trust (individually a “Fund” ), and (ii) by the vote of a majority of the Trustees who are not parties to the Advisory Agreement or “interested persons” of any party thereto (the “Independent Trustees”) cast in person at a meeting called for the purpose of voting on such approval.
The Board meets quarterly and takes into account throughout the year matters bearing on each Fund’s Advisory Agreement. The Board and its standing committees consider at each meeting factors that are relevant to the annual renewal of an Advisory Agreement, including the services and support provided to a Fund and its shareholders.
On December 6, 2006, the Independent Trustees first met in person with their independent legal counsel (“Independent Legal Counsel”) to consider information provided by the Adviser and others to assist the Trustees in considering whether to renew each Fund’s Advisory Agreement for a one year term beginning May 1, 2007. Immediately following such meeting of the Independent Trustees, all Trustees met in person with the Adviser, Trust counsel, Independent Legal Counsel and others to consider such matters, and give preliminary consideration to information bearing on continuation of each Advisory Agreement. The primary purpose of the December 6 and 7, 2006 meeting was to ensure that the Trustees had ample opportunity to consider matters they deemed relevant in considering the continuation of an Advisory Agreement, and to request any additional information they considered reasonably necessary to their deliberations.
In preparation for the December 6 and 7, 2006 meeting the Trustees were provided, at the request of the Trustees, with a wide range of information to assist in their deliberations, including (i) reports from Lipper Inc. describing a Fund’s (a) performance rankings (where “first quintile” denotes the best performance) (over multiple years ended September 30, 2006) compared with performance groups and performance universes created by Lipper (and in some cases, customized peer groups created by the Adviser) of similar or peer group funds, and (b) expense rankings (where “first quintile” denotes the lowest fees and expenses) comparing the Fund’s contractual advisory fee and total expenses with expense groups and expense universes created by Lipper of similar or peer group funds, (ii) information from the Adviser describing the Fund’s performance (over multiple years ended September 30, 2006) compared with its benchmark and Lipper categories, (iii) for Funds under “close review,” copies of letters from the Adviser to the portfolio manager of each such Fund, together with the portfolio manager’s written response describing the reasons for the Fund’s underperformance (iv) information from the Adviser describing performance for the months of October and November, 2006, and annual performance for the year ended November 30, 2006, (v) reports from the Adviser describing the Adviser’s profitability in providing services under an Advisory Agreement, together with an explanation of Adviser’s methodology in calculating its profitability, (vi) information from the Adviser describing any fees paid to the Adviser for managing similar, non-affiliated institutional accounts, including the range of fee levels for such accounts, and (vii) information from the Adviser describing ancillary benefits, in addition to fees for serving as investment adviser, derived by the Adviser as a result of being investment adviser for a Fund, including, where applicable, information on soft-dollar benefits and fees inuring to the Adviser’s affiliates for serving as the Trust’s administrator, fund accountant and transfer agent.
At the December 6 and 7, 2006 meeting, the Trustees reviewed, considered and discussed, among themselves and with the Adviser, Trust counsel and Independent Legal Counsel, among other things, the information described above, and: (i) the nature, extent and quality of services provided by the Adviser under each Advisory Agreement, (ii) the investment performance of each Fund and the Adviser, (iii) the costs of the services provided by the Adviser under the Advisory Agreement and the profits realized by the Adviser thereunder, (iv) the extent to which economies of scale may be present and, if so, whether they are being shared with a Fund’s shareholders, (v) comparisons of the Adviser’s fees under the Advisory Agreement with investment advisory fees paid by peer group funds to their investment advisers and paid by non-affiliated institutional clients to the Adviser for managing similar accounts, and (vi) any ancillary benefits inuring to the Adviser and its affiliates as a result of being investment adviser for the Trust. The Trustees also considered, where
As part of the December 6 and 7, 2006 Board meeting, the Independent Trustees developed a list of follow-up matters and questions and asked that Adviser respond to such matters and questions at the contract approval meeting of the Board of Trustees to be held on January 11, 2007.
At the January 11, 2007 meeting of the Board of Trustees of the Trust, the Board received and considered information provided by the Adviser in follow-up from the December 6 and 7, 2006 Board meeting and, after consulting among themselves, and with the Adviser, Trust counsel and Independent Legal Counsel, concluded unanimously to renew the Advisory Agreement for the reasons set forth in the following section. In determining whether to renew the Advisory Agreement for the Fund, the Board ultimately reached a determination, with the assistance of Trust counsel and Independent Legal Counsel, that the renewal of the Advisory Agreement and the compensation to be received by the Adviser under the Advisory Agreement is consistent with the Board’s fiduciary duty under applicable law.
(ii) | Board Conclusions Regarding the Fund’s Advisory Agreement |
The Board considered that the Fund had underperformed its benchmark, the MSCI Emerging Markets Index, for the one-, three-, and five-year periods. The Board also considered that the Fund’s Class II shares had ranked in the fifth quintile of the Fund’s Lipper-constructed Performance Group over the one-, two-, three-, four-, and five-year periods. Although the Fund’s performance compared with peer group funds over the periods considered ranked the Fund in the fifth quintile, the Board found that: (i) the portfolio manager for the Fund was changed during the year; (ii) recent performance had shown improvement; and (iii) the flows in and out of the Fund had been more extreme, which made management more difficult, and had affected performance. Based on its review, and giving particular weight to the nature and quality of the resources dedicated by the adviser and subadviser to improve relative performance, the Board concluded that the nature, extent, and quality of the services provided to the Fund will benefit the Fund’s shareholders.
The Board also considered that the Fund’s contractual advisory fee and breakpoints placed the Fund in the first quintile of its Lipper-constructed Expense Group and the Fund’s total expenses placed it in the second quintile. The Board considered that the Fund had implemented a performance fee structure, which is intended to either reward or penalize the adviser for outperforming or underperforming, respectively, the Fund’s benchmark. The Board concluded that the Fund’s management fee and total expenses were fair and reasonable in light of the services that the Fund receives and the other factors considered.
The Board considered that the Fund’s adviser reported a pre-tax profit margin for investment management services during each of the twelve month-periods ended September 30, 2006 and 2005. The Board considered the costs of the services provided by and the profits realized by the adviser in connection with the operation of the Fund and determined that the amount of profit is a fair entrepreneurial profit for the management of the Fund.
Based upon its evaluation of all of the conclusions noted above, and after considering all material factors with respect to the Fund, the Board ultimately concluded that the advisory fee structure is fair and reasonable, and that the Advisory Agreement (and, if applicable, Sub-Advisory Agreement) with respect to the Fund, should be renewed.
B. Approval of New Advisory Agreement
At its January 11, 2007 meeting, the Board also unanimously approved a new investment advisory agreement (the “New Agreement”) for the Fund with Nationwide Fund Advisors, (“NFA”) the then-current adviser to each of the series of the Trust to become effective upon the closing of the acquisition of NFA by Nationwide Financial Services, Inc. (“NFS”) from Nationwide Corporation (“NWC”) which closed on April 30, 2007 (the “Transaction”). In approving the New Agreement, the Board considered NFA’s capacity to continue to provide the services needed to operate a sophisticated investment management business and to support the management of each of the series. The Board also took into account
C. Submission of Matters to a Vote of Security Holders:
On April 25, 2007, a Special Meeting of Shareholders was held* (the “April 25 Meeting”) at which shareholders of the Funds** set forth below were asked:
Proposal 1:
To approve a new investment advisory agreement, on behalf of their Fund, between Nationwide Fund Advisors (formerly “Gartmore Mutual Fund Capital Trust”) (the “Adviser”) and Nationwide Variable Insurance Trust (formerly “Gartmore Variable Insurance Trust”) (the “Trust”).
Number of Shares | ||||||
Fund | Cast/Not Cast | Percentages | ||||
Federated NVIT High Income Bond Fund (Formerly Federated GVIT High Income Bond Fund) | FOR AGAINST ABSTAIN TOTAL | 30,051,703.188 shares 618,245.021 shares 1,813,550.431 shares 32,483,498.640 shares | 92.514% 1.903% 5.583% | |||
NVIT International Index Fund (Formerly GVIT International Index Fund) | FOR AGAINST ABSTAIN TOTAL | 4,322,203.982 shares 2,758.318 shares 135,636.840 shares 4,460,599.140 shares | 96.897% 0.062% 3.041% | |||
NVIT International Value Fund (Formerly GVIT International Value Fund) | FOR AGAINST ABSTAIN TOTAL | 20,032,843.199 shares 333,588.902 shares 1,093,293.879 shares 21,459,725.980 shares | 93.351% 1.554% 5.095% | |||
NVIT Mid Cap Index Fund (Formerly GVIT Mid Cap Index Fund) | FOR AGAINST ABSTAIN TOTAL | 35,380,179.120 shares 631,117.844 shares 1,565,714.306 shares 37,577,011.270 shares | 94.154% 1.679% 4.167% |
Number of Shares | ||||||
Fund | Cast/Not Cast | Percentages | ||||
NVIT S&P 500 Index Fund (Formerly GVIT S&P 500 Index Fund) | FOR AGAINST ABSTAIN TOTAL | 56,119,814.230 shares 666,195.542 shares 1,944,898.888 shares 58,730,908.660 shares | 95.554% 1.134% 3.312% | |||
Nationwide Multi-Manager NVIT Small Cap Growth Fund (Formerly GVIT Small Cap Growth Fund) | FOR AGAINST ABSTAIN TOTAL | 7,632,918.513 shares 149,458.111 shares 451,583.036 shares 8,233,959.660 shares | 92.700% 1.816% 5.484% | |||
Nationwide Multi-Manager NVIT Small Cap Value Fund (Formerly GVIT Small Cap Value Fund) | FOR AGAINST ABSTAIN TOTAL | 48,649,396.525 shares 979,183.753 shares 2,786,133.102 shares 52,414,713.380 shares | 92.816% 1.868% 5.316% | |||
Nationwide Multi-Manager NVIT Small Company Fund (Formerly GVIT Small Company Fund) | FOR AGAINST ABSTAIN TOTAL | 29,903,181.700 shares 838,774.923 shares 2,006,741.307 shares 32,748,697.930 shares | 91.311% 2.561% 6.128% | |||
Gartmore NVIT Developing Markets Fund (Formerly Gartmore GVIT Developing Markets Fund) | FOR AGAINST ABSTAIN TOTAL | 21,0177,889.443 shares 424,272.958 shares 1,543,850.729 shares 23,046,013.130 shares | 91.460% 1.841% 6.699% | |||
Gartmore NVIT Emerging Markets Fund (Formerly Gartmore GVIT Emerging Markets Fund) | FOR AGAINST ABSTAIN TOTAL | 17,050,534.593 shares 526,574.722 shares 881,608.905 shares 18,458,718.220 shares | 92.371% 2.853% 4.776% | |||
Nationwide NVIT Global Financial Services Fund (Formerly Gartmore GVIT Global Financial Services Fund) | FOR AGAINST ABSTAIN TOTAL | 1,554,847.333 shares 19,539.033 shares 52,206.494 shares 1,626,592.860 shares | 95.589% 1.201% 3.210% | |||
Nationwide NVIT Global Health Sciences Fund (Formerly Gartmore GVIT Global Health Sciences Fund) | FOR AGAINST ABSTAIN TOTAL | 4,722,963.678 shares 157,979.030 shares 207,642.222 shares 5,088,584.930 shares | 92.815% 3.104% 4.081% | |||
Nationwide NVIT Global Technology and Communications Fund (Formerly Gartmore GVIT Global Technology and Communications Fund) | FOR AGAINST ABSTAIN TOTAL | 8,585,472.039 shares 102,267.977 shares 489,577.634 shares 9,177,317.650 shares | 93.551% 1.114% 5.335% | |||
Gartmore NVIT Global Utilities Fund (Formerly Gartmore GVIT Global Utilities Fund) | FOR AGAINST ABSTAIN TOTAL | 4,123,270.549 shares 122,001.533 shares 240,276.088 shares 4,485,548.170 shares | 91.923% 2.720% 5.357% | |||
Nationwide NVIT Government Bond Fund (Formerly Gartmore GVIT Government Bond Fund) | FOR AGAINST ABSTAIN TOTAL | 88,471,567.462 shares 1,825,645.181 shares 5,841,990.727 shares 96,139,203.370 shares | 92.024% 1.899% 6.077% | |||
Number of Shares | ||||||
Fund | Cast/Not Cast | Percentages | ||||
Nationwide NVIT Growth Fund (Formerly Gartmore GVIT Growth Fund) | FOR AGAINST ABSTAIN TOTAL | 14,931,435.904 shares 409,826.402 shares 1,259,945.064 shares 16,601,207.370 shares | 89.942% 2.469% 7.589% | |||
Gartmore NVIT International Growth Fund (Formerly Gartmore GVIT International Growth Fund) | FOR AGAINST ABSTAIN TOTAL | 6,251,419.070 shares 139,618.548 shares 290,025.592 shares 6,681,063.210 shares | 93.569% 2.090% 4.341% | |||
Nationwide NVIT Investor Destinations Aggressive Fund (Formerly Gartmore GVIT Investor Destinations Aggressive Fund) | FOR AGAINST ABSTAIN TOTAL | 49,489,224.549 shares 1,385,396.474 shares 3,696,272.337 shares 54,570,893.360 shares | 90.688% 2.539% 6.773% | |||
Nationwide NVIT Investor Destinations Conservative Fund (Formerly Gartmore GVIT Investor Destinations Conservative Fund) | FOR AGAINST ABSTAIN TOTAL | 23,091,965.887 shares 314,935,884 shares 2,292,355.179 shares 25,699,256.950 shares | 89.855% 1.225% 8.920% | |||
Nationwide NVIT Investor Destinations Moderate Fund (Formerly Gartmore GVIT Investor Destinations Moderate Fund) | FOR AGAINST ABSTAIN TOTAL | 188,902,093.059 shares 3,018,924.590 shares 16,359,690.401 shares 208,280,708.050 shares | 90.696% 1.449% 7.855% | |||
Nationwide NVIT Investor Destinations Moderately Aggressive Fund (Formerly Gartmore GVIT Investor Destinations Moderately Aggressive Fund) | FOR AGAINST ABSTAIN TOTAL | 134,792,622.920 shares 3,489,207.264 shares 9,304,197.656 shares 147,586,027.840 shares | 91.332% 2.364% 6.304% | |||
Nationwide NVIT Investor Destinations Moderately Conservative Fund (Formerly Gartmore GVIT Investor Destinations Moderately Conservative Fund) | FOR AGAINST ABSTAIN TOTAL | 49,627,123.216 shares 856,088.634 shares 3,507,215.650 shares 53,990,427.500 shares | 91.918% 1.586% 6.496% | |||
Nationwide NVIT Mid Cap Growth Fund (Formerly Gartmore GVIT Mid Cap Growth Fund) | FOR AGAINST ABSTAIN TOTAL | 10,879,584.971 shares 352,594.958 shares 717,792.971 shares 11,949,972.900 shares | 91.043% 2.950% 6.007% | |||
Nationwide NVIT Money Market Fund II (Formerly Gartmore GVIT Money Market Fund II) | FOR AGAINST ABSTAIN TOTAL | 221,774,863.241 shares 12,322,482.494 shares 16,471,740.875 shares 250,569,086.610 shares | 88.508% 4.918% 6.574% | |||
Nationwide NVIT Money Market Fund (Formerly Gartmore GVIT Money Market Fund) | FOR AGAINST ABSTAIN TOTAL | 1,578,331,008.328 shares 32,372,133.671 shares 112,652,123.301 shares 1,723,355,265.300 shares | 91.585% 1.878% 6.537% | |||
NVIT Nationwide Fund (Formerly Gartmore GVIT Nationwide Fund) | FOR AGAINST ABSTAIN TOTAL | 125,423,274.735 shares 2,767,979.467 shares 8,762,255.828 shares 136,953,510.030 shares | 91.581% 2.021% 6.398% | |||
Number of Shares | ||||||
Fund | Cast/Not Cast | Percentages | ||||
NVIT Nationwide Leaders Fund (Formerly Gartmore GVIT Nationwide Leaders Fund) | FOR AGAINST ABSTAIN TOTAL | 2,298,504.956 shares 29,630.469 shares 71,637.755 shares 2,399,773.180 shares | 95.780% 1.235% 2.985% | |||
Nationwide NVIT U.S. Growth Leaders Fund (Formerly Gartmore GVIT U.S. Growth Leaders Fund) | FOR AGAINST ABSTAIN TOTAL | 4,972,094.773 shares 122,623.161 shares 174,625.606 shares 5,269,343.540 shares | 94.359% 2.327% 3.314% | |||
Gartmore NVIT Worldwide Leaders Fund (Formerly Gartmore GVIT Worldwide Leaders Fund) | FOR AGAINST ABSTAIN TOTAL | 2,666,862.487 shares 47,702.491 shares 118,719.882 shares 2,833,284.860 shares | 94.126% 1.684% 4.190% | |||
JP Morgan NVIT Balanced Fund (Formerly JP Morgan GVIT Balanced Fund) | FOR AGAINST ABSTAIN TOTAL | 15,966,867.546 shares 259,004.324 shares 1,339,385.200 shares 17,565,257.070 shares | 90.900% 1.475% 7.625% | |||
Van Kampen NVIT Comstock Value Fund (Formerly Van Kampen GVIT Comstock Value Fund) | FOR AGAINST ABSTAIN TOTAL | 27,737,008.009 shares 502,564.164 shares 1,824,670.107 shares 30,064,242.280 shares | 92.259% 1.672% 6.069% | |||
Van Kampen NVIT Multi Sector Bond Fund (Formerly Van Kampen GVIT Multi Sector Bond Fund) | FOR AGAINST ABSTAIN TOTAL | 21,253,297.665 shares 484,100.920 shares 1,803,963.645 shares 23,541,362.230 shares | 90.281% 2.056% 7.663% | |||
At the April 25 Meeting, shareholders of the Nationwide NVIT Mid Cap Growth Fund were also asked to approve a new investment subadvisory agreement among the Adviser, the Trust and NorthPointe Capital LLC. The voting results with respect to that proposal are set forth below:
Proposal 2:
Number of Shares | ||||||
Fund | Cast/Not Cast | Percentages | ||||
Nationwide NVIT Mid Cap Growth Fund (Formerly Gartmore GVIT Mid Cap Growth Fund) | FOR AGAINST ABSTAIN TOTAL | 10,862,827.499 shares 414,574.660 shares 672,570.741 shares 11,949,972.900 shares | 90.903% 3.469% 5.628% | |||
* | This meeting was previously adjourned on April 23, 2007. | |
** | Fund names were changed effective May 1, 2007 to reflect “Nationwide”/“NVIT” branding to coincide with the sale of Nationwide Fund Advisors, Inc. by Nationwide Corporation to its majority-owned subsidiary, Nationwide Financial Services, Inc. |
Contents | ||
6 | Statement of Investments | |
10 | Statement of Assets and Liabilities | |
12 | Statement of Operations | |
13 | Statements of Changes in Net Assets | |
15 | Financial Highlights | |
17 | Notes to Financial Statements |
SAR-EM (8/07) | ![]() |
![-s- John H. Grady](https://capedge.com/proxy/N-CSRS/0000893220-07-003038/w37711gradyjh.gif)
Beginning | Ending | |||||||||||||||||||||
Account Value, | Account Value, | Expenses Paid | Annualized | |||||||||||||||||||
Gartmore NVIT Emerging Markets Fund | January 1, 2007 | June 30, 2007 | During Period* | Expense Ratio* | ||||||||||||||||||
Class I | Actual | $ | 1,000.00 | $ | 1,201.40 | $ | 7.15 | 1.31% | ||||||||||||||
Hypothetical | 1 | $ | 1,000.00 | $ | 1,018.30 | $ | 6.58 | 1.31% | ||||||||||||||
Class II | Actual | $ | 1,000.00 | $ | 1,199.90 | $ | 8.56 | 1.57% | ||||||||||||||
Hypothetical | 1 | $ | 1,000.00 | $ | 1,017.01 | $ | 7.88 | 1.57% | ||||||||||||||
Class III | Actual | $ | 1,000.00 | $ | 1,201.50 | $ | 7.15 | 1.31% | ||||||||||||||
Hypothetical | 1 | $ | 1,000.00 | $ | 1,018.30 | $ | 6.58 | 1.31% | ||||||||||||||
Class VI | Actual | $ | 1,000.00 | $ | 1,201.00 | $ | 7.80 | 1.43% | ||||||||||||||
Hypothetical | 1 | $ | 1,000.00 | $ | 1,017.71 | $ | 7.18 | 1.43% | ||||||||||||||
* | Expenses are equal to the Fund’s annualized expense ratio multiplied by the average account value over the period multiplied by 181/365 (to reflect the one-half year period). The expense ratio presented represents a six-month, annualized ratio in accordance with SEC guidelines. The expenses reported above do not include the effect of additional expenses imposed by variable annuity contracts. | |
1 | Represents the hypothetical 5% return before expenses. |
Asset Allocation | ||||
Common Stock | 93.4% | |||
Participation Notes | 4.7% | |||
Repurchase Agreements | 1.3% | |||
Other Investments* | 4.5% | |||
Liabilities in excess of other assets** | -3.9% | |||
100.0% |
Top Holdings*** | ||||
Companhia Vale do Rio Doce, Preferred Shares, Class A | 2.5% | |||
Lojas Renner SA | 2.5% | |||
America Movil SA de CV ADR | 2.5% | |||
Hon Hai Precision Industry Co. Ltd. | 2.3% | |||
Gazprom ADR | 2.3% | |||
Petroleo Brasileiro SA ADR | 2.2% | |||
Sberbank RF | 2.1% | |||
Bharti Tele-Ventures Ltd. | 2.0% | |||
China Mobile Ltd. | 2.0% | |||
China Petroleum & Chemical Corp. | 1.9% | |||
Other | 77.7% | |||
100.0% |
Top Industries | ||||
Commercial Banks | 13.0% | |||
Oil, Gas & Consumable Fuels | 11.2% | |||
Metals & Mining | 10.9% | |||
Wireless Telecommunication Services | 9.6% | |||
Semiconductors & Semiconductor Equipment | 5.9% | |||
Insurance | 4.2% | |||
Electronic Equipment & Instruments | 3.5% | |||
Construction & Engineering | 3.5% | |||
Multiline Retail | 3.2% | |||
Construction Materials | 2.9% | |||
Other | 32.1% | |||
100.0% |
Top Countries | ||||
Republic of Korea | 15.5% | |||
Brazil | 13.9% | |||
Taiwan | 10.5% | |||
Russian Federation | 9.8% | |||
China | 8.4% | |||
Hong Kong | 7.3% | |||
Mexico | 6.6% | |||
South Africa | 6.6% | |||
India | 5.7% | |||
Malaysia | 4.0% | |||
Other | 11.7% | |||
100.0% |
* | Includes value of collateral received from securities lending. |
** | Includes value of collateral owed from securities lending. |
*** | For purpose of listing top holdings, repurchase agreements are included as part of Other. |
Common Stock (93.4%) | ||||||||
Shares or | ||||||||
Principal Amount | Value | |||||||
ARGENTINA (1.0%) | ||||||||
Metals & Mining (1.0%) | ||||||||
Tenaris SA ADR | 80,700 | $ | 3,951,072 | |||||
BRAZIL (13.9%) | ||||||||
Commercial Banks (2.2%) | ||||||||
Banco Bradesco SA, Preferred Shares | 177,618 | 4,286,601 | ||||||
Unibanco GDR | 35,600 | 4,018,172 | ||||||
8,304,773 | ||||||||
Diversified Telecommunication Services (1.1%) | ||||||||
Brasil Telecom Participacoes SA | 69,400 | 4,195,924 | ||||||
Insurance (1.1%) | ||||||||
Porto Seguro SA | 104,600 | 4,014,730 | ||||||
Metals & Mining (2.5%) | ||||||||
Companhia Vale do Rio Doce, Preferred Shares, Class A | 253,272 | 9,477,995 | ||||||
Multiline Retail (2.5%) | ||||||||
Lojas Renner SA | 509,900 | 9,468,060 | ||||||
Oil, Gas & Consumable Fuels (2.5%) | ||||||||
Petroleo Brasileiro SA ADR | 79,119 | 8,440,415 | ||||||
Petroleo Brasileiro SA ADR | 10,300 | 1,249,081 | ||||||
9,689,496 | ||||||||
Paper & Forest Products (0.8%) | ||||||||
Aracruz Celulose SA ADR | 48,250 | 3,196,080 | ||||||
Transportation Infrastructure (1.2%) | ||||||||
Companhia de Consessoes Rodoviarias | 248,739 | 4,622,572 | ||||||
52,969,630 | ||||||||
CHINA (8.4%) | ||||||||
Commercial Bank (0.9%) (a) (b) | ||||||||
China Construction Bank, Class H | 4,833,000 | 3,323,528 | ||||||
Construction Materials (1.9%) (a) (b) | ||||||||
Anhui Conch Cement Co. Ltd. | 1,006,000 | 7,072,984 | ||||||
Insurance (1.0%) (a) (b) | ||||||||
Ping An Insurance (Group) Co. of China Ltd. | 569,500 | 4,023,317 | ||||||
Media (0.8%) | ||||||||
Focus Media Holding Ltd. ADR* | 60,600 | 3,060,300 | ||||||
Oil, Gas & Consumable Fuels (3.8%) (b) | ||||||||
China Petroleum & Chemical Corp. (a) | 6,370,000 | 7,107,051 | ||||||
China Shenhua Energy Co. | 1,047,500 | 3,655,249 | ||||||
PetroChina Co. Ltd. | 2,492,000 | 3,701,620 | ||||||
14,463,920 | ||||||||
31,944,049 | ||||||||
CZECH REPUBLIC (1.5%) (b) | ||||||||
Electric Utility (1.5%) | ||||||||
CEZ AS | 109,900 | 5,655,994 | ||||||
HONG KONG (7.3%) | ||||||||
Multi-Utility (1.4%) (b) | ||||||||
China Resources Power Holdings Co. Ltd. | 2,253,800 | 5,386,037 | ||||||
Personal Products (0.7%) (a) (b) | ||||||||
Hengan International Group Co. Ltd. | 762,000 | 2,709,654 | ||||||
Real Estate Management & Development (1.5%) (a) | ||||||||
Country Garden Holdings Co.* | 927,000 | 782,489 | ||||||
Shimao Property Holdings Ltd. (b) | 2,190,200 | 4,899,742 | ||||||
5,682,231 | ||||||||
Textiles, Apparel & Luxury Goods (0.3%) (b) | ||||||||
Ports Design Ltd. | 416,500 | 1,171,615 | ||||||
Transportation (1.4%) (a) (b) | ||||||||
Pacific Basin Shipping Ltd. | 4,521,000 | 5,083,276 | ||||||
Wireless Telecommunication Services (2.0%) (b) | ||||||||
China Mobile Ltd. | 704,800 | 7,583,251 | ||||||
27,616,064 | ||||||||
HUNGARY (1.0%) (b) | ||||||||
Oil, Gas & Consumable Fuels (1.0%) | ||||||||
MOL Magyar Olaj-es Gazipari | 24,300 | 3,664,083 | ||||||
INDIA (1.2%) | ||||||||
IT Services (1.2%) | ||||||||
Satyam Computer Services Ltd. ADR | 177,800 | 4,402,328 | ||||||
INDONESIA (1.7%) (b) | ||||||||
Automobiles (0.8%) (a) | ||||||||
PT Astra International, Inc. | 1,640,500 | 3,079,991 | ||||||
Diversified Telecommunication Services (0.9%) | ||||||||
PT Telekomunikasi Indonesia | 3,065,543 | 3,327,309 | ||||||
6,407,300 | ||||||||
Common Stock (continued) | ||||||||
Shares or | ||||||||
Principal Amount | Value | |||||||
KAZAKHSTAN (0.7%) (b) | ||||||||
Oil, Gas & Consumable Fuels (0.7%) | ||||||||
Kazmunaigas Exploration Production GDR | 132,100 | $ | 2,805,545 | |||||
MALAYSIA (4.0%) | ||||||||
Commercial Bank (1.4%) (b) | ||||||||
Bumiputra Commerce Holdings Berhad | 1,609,900 | 5,459,019 | ||||||
Food Products (1.2%) (b) | ||||||||
IOI Corporation Berhad | 2,965,300 | 4,478,468 | ||||||
Hotels, Restaurants & Leisure (0.9%) (b) | ||||||||
Genting Berhard | 1,440,000 | 3,448,393 | ||||||
Wireless Telecommunication Services (0.5%) (a) | ||||||||
Maxis Communications Berhad | 444,900 | 2,011,722 | ||||||
15,397,602 | ||||||||
MEXICO (6.6%) | ||||||||
Commercial Bank (1.6%) | ||||||||
Grupo Financiero Banorte SA de CV | 1,308,376 | 5,992,636 | ||||||
Food & Staples Retailing (1.1%) | ||||||||
Wal-Mart de Mexico SA de CV | 1,128,560 | 4,283,158 | ||||||
Industrial Conglomerate (0.5%) (a) | ||||||||
Grupo Carso SA de CV | 518,759 | 2,007,232 | ||||||
Metals & Mining (0.9%) (a) | ||||||||
Industrias CH SA* | 762,300 | 3,521,130 | ||||||
Wireless Telecommunication Services (2.5%) | ||||||||
America Movil SA de CV ADR | 152,751 | 9,459,870 | ||||||
25,264,026 | ||||||||
PAKISTAN (0.1%) | ||||||||
Commercial Bank (0.1%) | ||||||||
MCB Bank Ltd. GDR | 15,784 | 378,829 | ||||||
POLAND (0.7%) (b) | ||||||||
Commercial Bank (0.7%) | ||||||||
Bank Zachodni WBK SA | 24,284 | 2,511,239 | ||||||
REPUBLIC OF KOREA (15.5%) | ||||||||
Airline (0.3%) (b) | ||||||||
Korean Air Lines Co. Ltd. | 21,110 | 1,198,152 | ||||||
Building Products (0.6%) (b) | ||||||||
KCC Corp. | 5,300 | 2,409,239 | ||||||
Chemicals (0.9%) (b) | ||||||||
LG Chem Ltd. | 38,756 | 3,270,043 | ||||||
Commercial Banks (1.8%) (b) | ||||||||
Industrial Bank of Korea | 265,700 | 5,411,845 | ||||||
Korea Exchange Bank | 103,590 | 1,540,878 | ||||||
6,952,723 | ||||||||
Construction & Engineering (3.0%) (b) | ||||||||
Hyundai Development Co. | 61,800 | 4,398,979 | ||||||
Hyundai Heavy Industries | 18,383 | 6,851,867 | ||||||
11,250,846 | ||||||||
Diversified Financial Services (0.7%) (b) | ||||||||
Shinhan Financial Group Ltd. | 46,600 | 2,837,500 | ||||||
Insurance (1.0%) (b) | ||||||||
Samsung Fire & Marine Insurance Co. Ltd. | 18,924 | 3,644,392 | ||||||
Machinery (1.5%) (b) | ||||||||
Hanjin Heavy Industries & Construction Co. Ltd. | 80,120 | 5,683,447 | ||||||
Metals & Mining (2.2%) (b) | ||||||||
Korea Zinc Co. Ltd. | 14,387 | 2,443,227 | ||||||
POSCO ADR | 12,638 | 6,069,601 | ||||||
8,512,828 | ||||||||
Multiline Retail (0.7%) | ||||||||
Lotte Shopping Co. Ltd. GDR | 144,286 | 2,802,034 | ||||||
Semiconductors & Semiconductor Equipment (2.8%) | ||||||||
Samsung Electrical Co. Ltd. (b) | 9,809 | 5,999,030 | ||||||
Samsung Electronics Co. Ltd. GDR | 18,912 | 4,505,784 | ||||||
10,504,814 | ||||||||
59,066,018 | ||||||||
RUSSIAN FEDERATION (9.8%) | ||||||||
Automobiles (0.7%) (b) | ||||||||
JSC Severstal-Avto | 85,406 | 2,882,452 | ||||||
Commercial Bank (2.1%) (b) | ||||||||
Sberbank RF | 2,036 | 7,866,907 | ||||||
Electric Utility (1.0%) | ||||||||
RAO Unified Energy System GDR | 27,270 | 3,688,267 | ||||||
Metals & Mining (1.3%) | ||||||||
Chelyabinsk Zink Plant* | 4,200 | 630,000 | ||||||
Norilsk Nickel ADR | 18,850 | 4,184,700 | ||||||
4,814,700 | ||||||||
Oil, Gas & Consumable Fuels (3.2%) | ||||||||
Gazprom ADR | 208,049 | 8,719,334 | ||||||
Surgutneftegaz ADR | 64,660 | 3,530,436 | ||||||
12,249,770 | ||||||||
Common Stock (continued) | ||||||||
Shares or | ||||||||
Principal Amount | Value | |||||||
RUSSIAN FEDERATION (continued) | ||||||||
Real Estate Investment Trust (REIT) (0.1%) | ||||||||
AFI Development PLC GDR* | 36,668 | $ | 414,348 | |||||
Wireless Telecommunication Services (1.4%) | ||||||||
Mobile Telesystems ADR | 86,401 | 5,233,309 | ||||||
37,149,753 | ||||||||
SOUTH AFRICA (6.6%) (b) | ||||||||
Commercial Bank (1.0%) (a) | ||||||||
ABSA Group Ltd. | 197,065 | 3,654,776 | ||||||
Food & Staples Retailing (0.5%) | ||||||||
Massmart Holdings Ltd. | 145,300 | 1,772,591 | ||||||
Health Care Providers & Services (0.9%) (a) | ||||||||
Network Healthcare Holdings Ltd. | 1,682,700 | 3,430,960 | ||||||
Industrial Conglomerate (1.1%) | ||||||||
Barloworld Ltd. | 154,507 | 4,299,263 | ||||||
Metals & Mining (1.1%) (a) | ||||||||
Anglo Platinum Ltd. | 25,944 | 4,266,646 | ||||||
Specialty Retail (0.8%) | ||||||||
Truworths International Ltd. | 615,200 | 3,169,368 | ||||||
Wireless Telecommunication Services (1.2%) | ||||||||
MTN Group Ltd. | 325,076 | 4,424,985 | ||||||
25,018,589 | ||||||||
TAIWAN (10.5%) | ||||||||
Computers & Peripherals (0.9%) (b) | ||||||||
Asustek Computer, Inc. | 1,213,000 | 3,336,503 | ||||||
Construction Materials (1.0%) (b) | ||||||||
Taiwan Cement Corp. | 3,223,464 | 3,735,152 | ||||||
Electronic Equipment & Instruments (2.3%) (b) | ||||||||
Delta Electronics, Inc. | 200 | 788 | ||||||
Hon Hai Precision Industry Co. Ltd. | 1,032,400 | 8,918,742 | ||||||
8,919,530 | ||||||||
Insurance (1.1%) (b) | ||||||||
Shin Kong Financial Holding Co. Ltd. | 3,667,287 | 4,262,405 | ||||||
Semiconductors & Semiconductor Equipment (4.3%) | ||||||||
Advanced Semiconductor Engineering, Inc.* (b) | 2,729,000 | 3,712,375 | ||||||
MediaTek, Inc. (b) | 259,000 | 4,030,272 | ||||||
Taiwan Semiconductor Manufacturing Co. Ltd. (b) | 2,924,112 | 6,263,359 | ||||||
Taiwan Semiconductor Manufacturing Co. Ltd. ADR | 195,011 | 2,170,476 | ||||||
16,176,482 | ||||||||
Textiles, Apparel & Luxury Goods (0.9%) (b) | ||||||||
Formosa Taffeta Co. Ltd. | 3,129,000 | 3,425,602 | ||||||
39,855,674 | ||||||||
THAILAND (1.2%) | ||||||||
Metals & Mining (1.2%) | ||||||||
Banpu Public Co. Ltd. | 583,167 | 4,527,865 | ||||||
TURKEY (1.0%) (a) (b) | ||||||||
Commercial Bank (1.0%) | ||||||||
Turkiye Vakiflar Bankasi | 1,465,309 | 3,740,030 | ||||||
VENEZUELA (0.7%) | ||||||||
Metals & Mining (0.7%) | ||||||||
Ternium SA | 94,800 | 2,871,492 | ||||||
Total Common Stocks (Cost $250,346,620) | 355,197,182 | |||||||
Participation Notes (4.7%) | ||||||||
INDIA (4.5%) | ||||||||
Chemicals (1.4%) (b) | ||||||||
Reliance Industries Ltd.* 0.00%, 03/09/09 | 133,103 | 5,558,381 | ||||||
Construction & Engineering (0.5%) (a) | ||||||||
Unitech Ltd. 0.00%, 07/08/10 | 148,259 | 1,836,929 | ||||||
Diversified Consumer Services (0.6%) (a) | ||||||||
Max India Ltd. 0.00%, 07/12/10 | 387,454 | 2,305,351 | ||||||
Wireless Telecommunication Services (2.0%) (b) | ||||||||
Bharti Tele-Ventures Ltd. 0.00%, 01/24/17 | 373,184 | 7,661,468 | ||||||
17,362,129 | ||||||||
Participation Notes (continued) | |||||||||
Principal | |||||||||
Amount | Value | ||||||||
PAKISTAN (0.2%) (b) | |||||||||
Commercial Bank (0.2%) | |||||||||
Muslim Commercial Bank Ltd.* 0.00%, 09/22/09 | 111,550 | $ | 673,762 | ||||||
Total Participation Notes (Cost $14,392,584) | 18,035,891 | ||||||||
Repurchase Agreements (1.3%) | |||||||||
Nomura Securities, 5.20%, dated 06/29/07, due 07/02/07, repurchase price $5,098,559 collateralized by U.S. Government Agency Mortgages with a market value of $5,198,278 | $ | 5,096,351 | 5,096,351 | ||||||
Securities held as Collateral for Securities on Loan (4.5%) | |||||||||
Morgan Stanley Repurchase Agreement, | |||||||||
5.42%, dated 06/29/07, due 07/02/07, repurchase price $16,921,722, collateralized by U.S. Government Agency Mortgages with a market value of $17,252,364 | 16,914,082 | 16,914,082 | |||||||
Total Investments (Cost $286,749,637) (c) — 103.9% | 395,243,506 | ||||||||
Liabilities in excess of other assets — (3.9)% | (14,831,153 | ) | |||||||
NET ASSETS — 100.0% | $ | 380,412,353 | |||||||
* | Denotes a non-income producing security. | |
(a) | All or a part of the security was on loan as of June 30, 2007. | |
(b) | Fair Valued Security. | |
(c) | See notes to financial statements for tax unrealized appreciation (depreciation) of securities. |
ADR | American Depository Receipt | |
CH | Switzerland | |
GDR | Global Depository Receipt |
Gartmore NVIT | ||||||
Emerging | ||||||
Markets Fund | ||||||
Assets: | ||||||
Investments, at value (cost $264,739,204)* | $ | 373,233,073 | ||||
Repurchase agreements, at cost and value | 22,010,433 | |||||
Total Investments | 395,243,506 | |||||
Cash | 18,937 | |||||
Foreign currencies, at value (cost $2,536,725) | 2,532,016 | |||||
Interest and dividends receivable | 776,825 | |||||
Receivable for capital shares issued | 681,222 | |||||
Receivable for investments sold | 910,854 | |||||
Unrealized appreciation on spot contracts | 16,929 | |||||
Reclaims receivable | 693 | |||||
Prepaid expenses | 3,322 | |||||
Total Assets | 400,184,304 | |||||
Liabilities: | ||||||
Payable for investments purchased | 1,790,224 | |||||
Payable upon return of securities loaned | 16,914,082 | |||||
Payable for capital shares redeemed | 46,686 | |||||
Accrued expenses and other payables: | ||||||
Investment advisory fees | 943,348 | |||||
Fund administration and transfer agent fees | 23,818 | |||||
Distribution fees | 18,617 | |||||
Administrative servicing fees | 13,381 | |||||
Compliance program costs | 3,711 | |||||
Other | 18,084 | |||||
Total Liabilities | 19,771,951 | |||||
Net Assets | $ | 380,412,353 | ||||
Represented by: | ||||||
Capital | $ | 243,007,393 | ||||
Accumulated net investment income | 585,260 | |||||
Accumulated net realized gains from investment transactions and foreign currency transactions | 28,327,038 | |||||
Net unrealized appreciation on investments and translation of assets and liabilities denominated in foreign currencies | 108,492,662 | |||||
Net Assets | $ | 380,412,353 | ||||
Net Assets: | ||||||
Class I Shares | $ | 55,855,820 | ||||
Class II Shares | 9,162,331 | |||||
Class III Shares | 229,912,140 | |||||
Class VI Shares | 85,482,062 | |||||
Total | $ | 380,412,353 | ||||
Shares outstanding (unlimited number of shares authorized): | ||||||
Class I Shares | 2,981,748 | |||||
Class II Shares | 492,241 | |||||
Class III Shares | 12,282,016 | |||||
Class VI Shares | 4,568,204 | |||||
Total | 20,324,209 | |||||
Gartmore NVIT | ||||
Emerging | ||||
Markets Fund | ||||
Net asset value and offering price per share (Net assets by class divided by shares outstanding by class, respectively.): | ||||
Class I Shares | $ | 18.73 | ||
Class II Shares | $ | 18.61 | ||
Class III Shares | $ | 18.72 | ||
Class VI Shares | $ | 18.71 |
* | Includes value of securities on loan of $16,207,168. |
Gartmore NVIT | |||||
Emerging | |||||
Markets Fund | |||||
INVESTMENT INCOME: | |||||
Interest income | $ | 153,898 | |||
Dividend income | 3,879,442 | ||||
Income from securities lending | 41,009 | ||||
Foreign tax withholding | (334,505 | ) | |||
Total Income | 3,739,844 | ||||
Expenses: | |||||
Investment advisory fees | 1,768,564 | ||||
Fund administration and transfer agent fees | 106,066 | ||||
Distribution fees Class II Shares | 10,687 | ||||
Distribution fees Class VI Shares | 91,135 | ||||
Administrative servicing fees Class I Shares | 31,265 | ||||
Administrative servicing fees Class II Shares | 6,117 | ||||
Administrative servicing fees Class III Shares | 133,106 | ||||
Custodian fees | 12,199 | ||||
Trustee fees | 7,285 | ||||
Compliance program costs (Note 3) | 2,168 | ||||
Other | 45,368 | ||||
Total expenses before earnings credit | 2,213,960 | ||||
Earnings credit (Note 6) | (26 | ) | |||
Net Expenses | 2,213,934 | ||||
Net Investment Income | 1,525,910 | ||||
REALIZED/ UNREALIZED GAINS (LOSSES) FROM INVESTMENTS: | |||||
Net realized gains on investment transactions | 28,643,173 | ||||
Net realized losses on foreign currency transactions | (60,063 | ) | |||
Net realized gains on investment transactions and foreign currency transactions | 28,583,110 | ||||
Net change in unrealized appreciation on investments and translation of assets and liabilities denominated in foreign currencies | 31,114,191 | ||||
Net realized/unrealized gains (losses) on investments and translation of assets and liabilities denominated in foreign currencies | 59,697,301 | ||||
CHANGE IN NET ASSETS RESULTING FROM OPERATIONS | $ | 61,223,211 | |||
Gartmore NVIT | |||||||||
Emerging Markets Fund | |||||||||
Six Months Ended | Year Ended | ||||||||
June 30, 2007 | December 31, 2006 | ||||||||
(Unaudited) | |||||||||
FROM INVESTMENT ACTIVITIES: | |||||||||
Operations: | |||||||||
Net investment income | $ | 1,525,910 | $ | 2,286,127 | |||||
Net realized gains on investment transactions and foreign currency transactions | 28,583,110 | 39,886,741 | |||||||
Net change in unrealized appreciation on investments and translation of assets and liabilities denominated in foreign currencies | 31,114,191 | 38,542,921 | |||||||
Change in net assets resulting from operations | 61,223,211 | 80,715,789 | |||||||
Distributions to shareholders from: | |||||||||
Net investment income: | |||||||||
Class I | (148,864 | ) | (275,675 | ) | |||||
Class II | (14,404 | ) | (43,726 | ) | |||||
Class III | (594,509 | ) | (1,298,960 | ) | |||||
Class VI | (182,873 | ) | (320,989 | ) | |||||
Net realized gains: | |||||||||
Class I | (5,931,932 | ) | (439,001 | ) | |||||
Class II | (979,635 | ) | (94,779 | ) | |||||
Class III | (24,362,174 | ) | (2,057,003 | ) | |||||
Class VI | (9,036,777 | ) | (584,008 | ) | |||||
Change in net assets from shareholder distributions | (41,251,168 | ) | (5,114,141 | ) | |||||
Change in net assets from capital transactions | 37,498,081 | 21,361,870 | |||||||
Change in net assets | 57,470,124 | 96,963,518 | |||||||
Net Assets: | |||||||||
Beginning of period | 322,942,229 | 225,978,711 | |||||||
End of period | $ | 380,412,353 | $ | 322,942,229 | |||||
Accumulated net investment income at end of period | $ | 585,260 | $ | – | |||||
CAPITAL TRANSACTIONS: | |||||||||
Class I Shares | |||||||||
Proceeds from shares issued | $ | 8,149,607 | $ | 22,214,857 | |||||
Dividends reinvested | 6,080,792 | 714,675 | |||||||
Cost of shares redeemed (a) | (7,865,749 | ) | (18,646,183 | ) | |||||
6,364,650 | 4,283,349 | ||||||||
Class II Shares | |||||||||
Proceeds from shares issued | 2,745 | 866 | |||||||
Dividends reinvested | 994,038 | 138,505 | |||||||
Cost of shares redeemed (a) | (1,108,442 | ) | (1,954,044 | ) | |||||
(111,659 | ) | (1,814,673 | ) | ||||||
Class III Shares | |||||||||
Proceeds from shares issued | 27,955,227 | 67,681,656 | |||||||
Dividends reinvested | 24,956,668 | 3,355,956 | |||||||
Cost of shares redeemed (a) | (32,217,355 | ) | (72,974,650 | ) | |||||
20,694,540 | (1,937,038 | ) | |||||||
Gartmore NVIT | |||||||||
Emerging Markets Fund | |||||||||
Six Months Ended | Year Ended | ||||||||
June 30, 2007 | December 31, 2006 | ||||||||
(Unaudited) | |||||||||
Class VI Shares | |||||||||
Proceeds from shares issued | $ | 15,325,034 | $ | 38,630,037 | |||||
Dividends reinvested | 9,219,645 | 904,995 | |||||||
Cost of shares redeemed (a) | (13,994,129 | ) | (18,704,800 | ) | |||||
10,550,550 | 20,830,232 | ||||||||
Change in net assets from capital transactions | $ | 37,498,081 | $ | 21,361,870 | |||||
SHARE TRANSACTIONS: | |||||||||
Class I Shares | |||||||||
Issued | 447,844 | 1,509,696 | |||||||
Reinvested | 328,648 | 53,520 | |||||||
Redeemed | (429,638 | ) | (1,243,463 | ) | |||||
346,854 | 319,753 | ||||||||
Class II Shares | |||||||||
Issued | 50 | 44 | |||||||
Reinvested | 54,063 | 10,466 | |||||||
Redeemed | (60,812 | ) | (136,828 | ) | |||||
(6,699 | ) | (126,318 | ) | ||||||
Class III Shares | |||||||||
Issued | 1,485,643 | 4,531,283 | |||||||
Reinvested | 1,350,219 | 251,415 | |||||||
Redeemed | (1,832,234 | ) | (5,092,979 | ) | |||||
1,003,628 | (310,281 | ) | |||||||
Class VI Shares | |||||||||
Issued | 818,590 | 2,538,913 | |||||||
Reinvested | 498,792 | 67,913 | |||||||
Redeemed | (783,823 | ) | (1,325,799 | ) | |||||
533,559 | 1,281,027 | ||||||||
Total change in shares | 1,877,342 | 1,164,181 | |||||||
(a) | Includes redemption fees, if any. |
Investment Activities | Distributions | |||||||||||||||||||||||||||
Net Realized | ||||||||||||||||||||||||||||
and | ||||||||||||||||||||||||||||
Net Asset | Unrealized | Total | ||||||||||||||||||||||||||
Value, | Net | Gains | from | Net | Net | |||||||||||||||||||||||
Beginning | Investment | (Losses) on | Investment | Investment | Realized | Total | ||||||||||||||||||||||
of Period | Income | Investments | Activities | Income | Gains | Distributions | ||||||||||||||||||||||
Class I Shares | ||||||||||||||||||||||||||||
For the year ended December 31, 2002 | $ | 7.08 | 0.05 | (1.14 | ) | (1.09 | ) | (0.01 | ) | – | (0.01 | ) | ||||||||||||||||
For the year ended December 31, 2003 | $ | 5.99 | 0.09 | 3.80 | 3.89 | (0.05 | ) | – | (0.05 | ) | ||||||||||||||||||
For the year ended December 31, 2004 | $ | 9.84 | 0.13 | 1.89 | 2.02 | (0.11 | ) | (0.93 | ) | (1.04 | ) | |||||||||||||||||
For the year ended December 31, 2005 | $ | 10.83 | 0.10 | 3.38 | 3.48 | (0.07 | ) | (1.16 | ) | (1.23 | ) | |||||||||||||||||
For the year ended December 31, 2006 | $ | 13.08 | 0.12 | 4.58 | 4.70 | (0.10 | ) | (0.17 | ) | (0.27 | ) | |||||||||||||||||
For the six months ended June 30, 2007 (Unaudited) | $ | 17.52 | 0.09 | 3.41 | 3.50 | (0.06 | ) | (2.23 | ) | (2.29 | ) | |||||||||||||||||
Class II Shares | ||||||||||||||||||||||||||||
Period ended December 31, 2002 (e) | $ | 7.71 | 0.01 | (1.73 | ) | (1.72 | ) | (0.01 | ) | – | (0.01 | ) | ||||||||||||||||
For the year ended December 31, 2003 | $ | 5.99 | 0.04 | 3.81 | 3.85 | (0.03 | ) | – | (0.03 | ) | ||||||||||||||||||
For the year ended December 31, 2004 | $ | 9.82 | 0.11 | 1.87 | 1.98 | (0.09 | ) | (0.93 | ) | (1.02 | ) | |||||||||||||||||
For the year ended December 31, 2005 | $ | 10.79 | 0.07 | 3.37 | 3.44 | (0.05 | ) | (1.16 | ) | (1.21 | ) | |||||||||||||||||
For the year ended December 31, 2006 | $ | 13.02 | 0.09 | 4.55 | 4.64 | (0.08 | ) | (0.17 | ) | (0.25 | ) | |||||||||||||||||
For the six months ended June 30, 2007 (Unaudited) | $ | 17.42 | 0.06 | 3.39 | 3.45 | (0.03 | ) | (2.23 | ) | (2.26 | ) |
[Additional columns below]
[Continued from above table, first column(s) repeated]
Ratios/Supplemental Data | ||||||||||||||||||||||||||||||||||||||
Ratio of Net | ||||||||||||||||||||||||||||||||||||||
Ratio of | Investment | |||||||||||||||||||||||||||||||||||||
Expenses | Income | |||||||||||||||||||||||||||||||||||||
Paid-in | Ratio of Net | (Prior to | (Prior to | |||||||||||||||||||||||||||||||||||
capital | Net Assets | Ratio of | Investment | Reimbursements) | Reimbursements) | |||||||||||||||||||||||||||||||||
from | Net Asset | at End of | Expenses to | Income to | to Average | to Average | ||||||||||||||||||||||||||||||||
redemption | Value, End | Total | Period | Average Net | Average Net | Net Assets | Net Assets | Portfolio | ||||||||||||||||||||||||||||||
fees | of Period | Return (a) | (000s) | Assets (b) | Assets (b) | (b)(c) | (b)(c) | Turnover (d) | ||||||||||||||||||||||||||||||
Class I Shares | ||||||||||||||||||||||||||||||||||||||
For the year ended December 31, 2002 | 0.01 | $ | 5.99 | (15.23% | ) | $ | 10,005 | 1.43% | 0.63% | (g) | (g) | 219.84% | ||||||||||||||||||||||||||
For the year ended December 31, 2003 | 0.01 | $ | 9.84 | 65.26% | $ | 16,993 | 1.39% | 1.17% | (g) | (g) | 133.49% | |||||||||||||||||||||||||||
For the year ended December 31, 2004 | 0.01 | $ | 10.83 | 20.74% | $ | 20,280 | 1.47% | 1.08% | (g) | (g) | 151.18% | |||||||||||||||||||||||||||
For the year ended December 31, 2005 | – | $ | 13.08 | 32.64% | $ | 30,292 | 1.46% | 0.89% | (g) | (g) | 132.22% | |||||||||||||||||||||||||||
For the year ended December 31, 2006 | 0.01 | $ | 17.52 | 36.72% | $ | 46,161 | 1.33% | 0.81% | (g) | (g) | 114.19% | |||||||||||||||||||||||||||
For the six months ended June 30, 2007 (Unaudited) | – | $ | 18.73 | 20.14% | $ | 55,856 | 1.31% | 0.97% | 1.31% | 0.97% | 35.32% | |||||||||||||||||||||||||||
Class II Shares | ||||||||||||||||||||||||||||||||||||||
Period ended December 31, 2002 (e) | 0.01 | $ | 5.99 | (22.23% | ) | $ | 454 | 1.71% | 0.44% | (g) | (g) | 219.84% | ||||||||||||||||||||||||||
For the year ended December 31, 2003 | 0.01 | $ | 9.82 | 64.66% | $ | 6,360 | 1.66% | 0.35% | (g) | (g) | 133.49% | |||||||||||||||||||||||||||
For the year ended December 31, 2004 | 0.01 | $ | 10.79 | 20.44% | $ | 8,178 | 1.72% | 0.87% | (g) | (g) | 151.18% | |||||||||||||||||||||||||||
For the year ended December 31, 2005 | – | $ | 13.02 | 32.33% | $ | 8,141 | 1.71% | 0.61% | (g) | (g) | 132.22% | |||||||||||||||||||||||||||
For the year ended December 31, 2006 | 0.01 | $ | 17.42 | 36.31% | $ | 8,692 | 1.58% | 0.61% | (g) | (g) | 114.19% | |||||||||||||||||||||||||||
For the six months ended June 30, 2007 (Unaudited) | – | $ | 18.61 | 19.99% | $ | 9,162 | 1.57% | 0.70% | 1.57% | 0.70% | 35.32% |
(a) | Not annualized for periods less than one year. | |
(b) | Annualized for periods less than one year. | |
(c) | During the period, certain fees were waived and/or reimbursed. If such waivers/reimbursements had not occurred, the ratios would have been as indicated. | |
(d) | Portfolio turnover is calculated on the basis of the Fund as a whole without distinguishing among the classes of shares. | |
(e) | For the period from March 4, 2002 (commencement of operations) through December 31, 2002. | |
(f) | For the period from May 2, 2002 (commencement of operations) through December 31, 2002. | |
(g) | There were no fee waivers/reimbursements during the period. | |
(h) | For the period from April 28, 2004 (commencement of operations) through December 31, 2004. |
Investment Activities | Distributions | |||||||||||||||||||||||||||
Net Realized | ||||||||||||||||||||||||||||
and | ||||||||||||||||||||||||||||
Net Asset | Unrealized | Total | ||||||||||||||||||||||||||
Value, | Net | Gains | from | Net | Net | |||||||||||||||||||||||
Beginning | Investment | (Losses) on | Investment | Investment | Realized | Total | ||||||||||||||||||||||
of Period | Income | Investments | Activities | Income | Gains | Distributions | ||||||||||||||||||||||
Class III Shares | ||||||||||||||||||||||||||||
Period ended December 31, 2002 (f) | $ | 7.90 | 0.01 | (1.91 | ) | (1.90 | ) | (0.02 | ) | – | (0.02 | ) | ||||||||||||||||
For the year ended December 31, 2003 | $ | 5.99 | 0.06 | 3.82 | 3.88 | (0.04 | ) | – | (0.04 | ) | ||||||||||||||||||
For the year ended December 31, 2004 | $ | 9.84 | 0.12 | 1.90 | 2.02 | (0.11 | ) | (0.93 | ) | (1.04 | ) | |||||||||||||||||
For the year ended December 31, 2005 | $ | 10.83 | 0.08 | 3.40 | 3.48 | (0.07 | ) | (1.16 | ) | (1.23 | ) | |||||||||||||||||
For the year ended December 31, 2006 | $ | 13.08 | 0.12 | 4.57 | 4.69 | (0.10 | ) | (0.17 | ) | (0.27 | ) | |||||||||||||||||
For the six months ended June 30, 2007 (Unaudited) | $ | 17.51 | 0.09 | 3.41 | 3.50 | (0.06 | ) | (2.23 | ) | (2.29 | ) | |||||||||||||||||
Class VI Shares | ||||||||||||||||||||||||||||
Period ended December 31, 2004 (h) | $ | 10.11 | 0.05 | 1.62 | 1.67 | (0.10 | ) | (0.86 | ) | (0.96 | ) | |||||||||||||||||
For the year ended December 31, 2005 | $ | 10.83 | 0.07 | 3.40 | 3.47 | (0.07 | ) | (1.16 | ) | (1.23 | ) | |||||||||||||||||
For the year ended December 31, 2006 | $ | 13.07 | 0.10 | 4.58 | 4.68 | (0.09 | ) | (0.17 | ) | (0.26 | ) | |||||||||||||||||
For the six months ended June 30, 2007 (Unaudited) | $ | 17.50 | 0.08 | 3.41 | 3.49 | (0.05 | ) | (2.23 | ) | (2.28 | ) |
[Additional columns below]
[Continued from above table, first column(s) repeated]
Ratios/Supplemental Data | ||||||||||||||||||||||||||||||||||||||
Ratio of Net | ||||||||||||||||||||||||||||||||||||||
Investment | ||||||||||||||||||||||||||||||||||||||
Ratio of | Income | |||||||||||||||||||||||||||||||||||||
Paid-in | Ratio of Net | Expenses | (Prior to | |||||||||||||||||||||||||||||||||||
capital | Net Assets | Ratio of | Investment | (Prior to | Reimbursements) | |||||||||||||||||||||||||||||||||
from | Net Asset | at End of | Expenses to | Income to | Reimbursements) | to Average | ||||||||||||||||||||||||||||||||
redemption | Value, End | Total | Period | Average Net | Average Net | to Average | Net Assets | Portfolio | ||||||||||||||||||||||||||||||
fees | of Period | Return (a) | (000s) | Assets (b) | Assets (b) | Net Assets (b)(c) | (b)(c) | Turnover (d) | ||||||||||||||||||||||||||||||
Class III Shares | ||||||||||||||||||||||||||||||||||||||
Period ended December 31, 2002 (f) | 0.01 | $ | 5.99 | (23.99% | ) | $ | 11,435 | 1.39% | 0.61% | (g) | (g) | 219.84% | ||||||||||||||||||||||||||
For the year ended December 31, 2003 | 0.01 | $ | 9.84 | 65.22% | $ | 46,902 | 1.42% | 0.89% | (g) | (g) | 133.49% | |||||||||||||||||||||||||||
For the year ended December 31, 2004 | 0.01 | $ | 10.83 | 20.76% | $ | 66,844 | 1.48% | 1.08% | (g) | (g) | 151.18% | |||||||||||||||||||||||||||
For the year ended December 31, 2005 | – | $ | 13.08 | 32.65% | $ | 151,546 | 1.45% | 0.75% | (g) | (g) | 132.22% | |||||||||||||||||||||||||||
For the year ended December 31, 2006 | 0.01 | $ | 17.51 | 36.64% | $ | 197,467 | 1.33% | 0.87% | (g) | (g) | 114.19% | |||||||||||||||||||||||||||
For the six months ended June 30, 2007 (Unaudited) | – | $ | 18.72 | 20.15% | $ | 229,912 | 1.31% | 0.96% | 1.31% | 0.96% | 35.32% | |||||||||||||||||||||||||||
Class VI Shares | ||||||||||||||||||||||||||||||||||||||
Period ended December 31, 2004 (h) | 0.01 | $ | 10.83 | 16.70% | $ | 8,862 | 1.68% | 0.97% | (g) | (g) | 151.18% | |||||||||||||||||||||||||||
For the year ended December 31, 2005 | – | $ | 13.07 | 32.49% | $ | 36,000 | 1.55% | 0.59% | (g) | (g) | 132.22% | |||||||||||||||||||||||||||
For the year ended December 31, 2006 | 0.01 | 17.50 | 36.56% | $ | 70,623 | 1.43% | 0.69% | (g) | (g) | 114.19% | ||||||||||||||||||||||||||||
For the six months ended June 30, 2007 (Unaudited) | – | $ | 18.71 | 20.10% | $ | 85,482 | 1.43% | 0.83% | 1.43% | 0.83% | 35.32% |
(a) | Not annualized for periods less than one year. | |
(b) | Annualized for periods less than one year. | |
(c) | During the period, certain fees were waived and/or reimbursed. If such waivers/reimbursements had not occurred, the ratios would have been as indicated. | |
(d) | Portfolio turnover is calculated on the basis of the Fund as a whole without distinguishing among the classes of shares. | |
(e) | For the period from March 4, 2002 (commencement of operations) through December 31, 2002. | |
(f) | For the period from May 2, 2002 (commencement of operations) through December 31, 2002. | |
(g) | There were no fee waivers/reimbursements during the period. | |
(h) | For the period from April 28, 2004 (commencement of operations) through December 31, 2004. |
(a) | Security Valuation |
Securities for which market quotations are readily available are valued at current market value as of “Valuation Time.” Valuation Time is as of the close of regular trading on the New York Stock Exchange (usually 4 p.m. Eastern time). Equity securities are valued at the last quoted sale price or, if there is no sale price, the last quoted bid price provided by an independent pricing service approved by the Trust’s Board of Trustees (“Board of Trustees”). Securities traded on NASDAQ are valued at the NASDAQ official closing price. Prices are taken from the primary market or exchange in which each security trades. | |
Most securities listed on a foreign exchange are valued either at fair value (see description below) or at the last sale price at the close of the exchange on which the security is principally traded. Foreign securities, currencies, and other assets and liabilities denominated in foreign currencies are translated into U.S. dollars at the exchange rate of said currencies against the U.S. dollar, as of Valuation Time, as provided by an independent pricing service approved by the Board of Trustees. | |
Securities for which market quotations are not readily available, or for which an independent pricing service does not provide a value or provides a value that does not represent fair value in the judgment of the Fund’s investment adviser or designee, are valued at fair value under procedures approved by the Board of Trustees. The “Fair Value” of these securities is determined in good faith by taking into account relevant factors and surrounding circumstances. Methods utilized to obtain a “Fair Value” may include the following non-exclusive list of acceptable methods: (i) a multiple of earnings; (ii) the discount from market value of a similar, freely traded security; (iii) the yield-to-maturity for debt issues; or (iv) a consolidation of the methods. The Trust’s Valuation & Operations Committee considers a non-exclusive list of factors to arrive at the appropriate method of determining “Fair Value.” For example, fair value determinations are required for securities whose value is affected by a “significant” event that materially affects the value of a domestic or foreign security which occurs subsequent to the time of the close of the principal market on which such domestic or foreign security trades and before the Valuation Time (i.e., a “subsequent event”). Typically, |
this will involve events occurring after the close of a foreign market on which a security trades and before the next Valuation Time. | |
The Fund values foreign securities at fair value in the circumstances described below. Generally, trading in foreign securities markets is completed each day at various times prior to the Valuation Time. Due to the time differences between the closings of the relevant foreign securities exchanges and the Valuation Time for the Fund, the Fund will fair value its foreign investments when it is determined that the market quotations for the foreign investments either are not readily available or are unreliable and, therefore, do not represent fair value. When the fair value prices are utilized, these prices will attempt to reflect the impact of the U.S. financial markets’ perceptions and trading activities on the Fund’s foreign investments since the last closing prices of the foreign investments were calculated on their primary foreign securities markets or exchanges. For these purposes, the Board of Trustees has determined that movements in relevant indices or other appropriate market indicators, after the close of the foreign securities exchanges, may demonstrate that market quotations are unreliable, and may trigger fair value pricing for certain securities. Consequently, fair valuation of portfolio securities may occur on a daily basis. |
(b) | Repurchase Agreements |
The Fund may enter into repurchase agreements with an entity which is a member of the Federal Reserve System or which is a “primary dealer” (as designated by the Federal Reserve Bank of New York) in U.S. Government obligations. The repurchase price generally equals the price paid by the Fund plus interest negotiated on the basis of current short-term rates, which may be more or less than the rate on the underlying portfolio securities. The seller under a repurchase agreement is required to maintain the value of the collateral held pursuant to the agreement at a market value equal to or greater than the repurchase price (including accrued interest). Collateral subject to repurchase agreements is held by the Fund’s custodian or another qualified sub-custodian or in the Federal Reserve/ Treasury book-entry system. If the counterparty defaults and the fair value of the collateral declines, realization of the collateral by the Fund may be delayed or limited. The Fund may transfer uninvested cash balances into a pooled cash account. These balances are invested in one or more repurchase agreements, with the counterparty of Nomura Securities, which is fully collateralized by U.S. Government Agency Mortgages. |
(c) | Foreign Currency Transactions |
The accounting records of the Fund are maintained in U.S. dollars. Foreign currency amounts are translated into U.S. dollars at the current rate of exchange to determine the value of investments, assets and liabilities. The Fund may enter into foreign currency contracts in connection with purchases or sales of securities denominated in a foreign currency. Purchases and sales of securities, and income and expenses, are translated at the prevailing rate of exchange on the respective date of these transactions. The Fund does not isolate that portion of the results of operations resulting from changes in foreign exchange rates on investments from fluctuations arising from changes in market prices of securities held. These fluctuations are included with the net realized and unrealized gain or loss from investments and foreign currencies. |
(d) | Forward Foreign Currency Contracts |
The Fund may enter into forward foreign currency contracts in connection with planned purchases or sales of securities or to hedge the U.S. dollar value of portfolio securities denominated in a particular currency. The Fund could be exposed to risks if the counterparties to the contracts are unable to meet the terms of their contracts and from unanticipated movements in the value of a foreign currency relative to the U.S. dollar. Forward foreign currency contracts are valued at the current cost of covering these contracts, as provided by an independent pricing service approved by the Board of Trustees. The forward foreign currency contracts are adjusted by the daily exchange rate of the underlying currency and any gains or losses are recorded for financial statement purposes as unrealized gains or losses until the contract settlement date. |
(e) | Futures Contracts |
The Fund may invest in financial futures contracts (“futures contracts”) for the purpose of hedging its existing portfolio securities or securities that the Fund intends to purchase against fluctuations in value caused by changes in prevailing market interest rates or prices. Futures contracts may also be entered into for non-hedging purposes. | |
Upon entering into a futures contract, the Fund is required to pledge to the broker an amount of cash and/or other assets equal to a certain percentage of the contract amount (initial margin deposit). Subsequent payments, known as “variation margin,” are made each day, depending on the daily fluctuations in the fair value/market value of the underlying assets. A gain or loss equal to the daily variation margin is recognized on a daily basis. Futures contracts are valued daily at their last quoted sale price. | |
A “sale” of a futures contract means the creation of a contractual obligation to deliver the securities or foreign currency called for by the contract at a fixed price at a specified time in the future. A “purchase” of a futures contract means the creation of a contractual obligation to acquire the securities or foreign currency at a fixed price at a specified time in the future. | |
Should market conditions change unexpectedly, the Fund may not achieve the anticipated benefits of the futures contracts and may realize a loss. The use of futures transactions for hedging purposes involves the risk of imperfect correlation in movements in the price of futures contracts, interest rates, and the value of the underlying hedged assets. |
(f) | Written Options Contracts |
The Fund may write options contracts. A written option obligates the Fund to deliver (written call) or to receive (written put) a specified quantity of an underlying asset at the contract amount upon exercise by the holder of the option. When the Fund writes an option, an amount equal to the premium received by the Fund is recorded as a liability and is subsequently adjusted to the current fair value of the option written. Premiums received from writing options that expire unexercised are treated by the Fund on the expiration date as realized gains from investments. The difference between the premium and the amount paid on effecting a closing purchase transaction, as a realized loss. If a call option is exercised, the premium is added to the proceeds from the sale of the underlying security or currency in determining whether the Fund has realized a gain or loss. If a put option is exercised, the premium reduces the cost basis of the securities purchased by the Fund. Options traded on an exchange are valued at the last quoted sale price, or in the absence of a sale, the bid price provided by an independent pricing service approved by the Board of Trustees. Non-exchange traded options are valued using dealer supplied quotes. The Fund as a writer of an option bears the market risk of an unfavorable change in the price of the security underlying the written option. |
(g) | Participation Notes |
Participation notes are synthetic equity instruments that allow investors to gain equity exposure to the underlying shares without ownership of the underlying shares. This is a more cost efficient way of gaining exposure to the local Indian market as custody and settlement costs are high. These securities are priced at parity, which is the value of the underlying security and adjusted by the appropriate foreign exchange rate. | |
The level and type of risk involved in the purchase of a participation note by a Fund is similar to the risk involved in the purchase of the underlying security or other emerging market securities. Such notes therefore may be considered to have speculative elements. However, participation notes are also dependent on the individual credit of the issuer of the note, which may be a trust or other special purpose vehicle or finance subsidiary established by a major financial institution for the limited purpose of issuing the note. Like other structured products, participation notes are frequently secured by collateral consisting of a combination of debt or related equity securities to which payments under the notes are linked. If so secured, the Fund would look to this underlying collateral for satisfaction of claims in the event that the issuer of a participation note defaulted under the terms of the note. |
(h) | Security Transactions and Investment Income |
Security transactions are accounted for on the date the security is purchased or sold (“trade date”). Securities gains and losses are calculated on the identified cost basis. Interest income is recognized on the accrual basis and includes, where applicable, the amortization or accretion of premium or discount. Dividend income is recorded on the ex-dividend date. |
(i) | Securities Lending |
To generate additional income, the Fund may lend its portfolio securities, up to 331/3% of the Fund, to brokers, dealers and other financial institutions provided that (1) the borrower delivers cash or securities as collateral with respect to each new loan of U.S. securities, equal to at least 102% of the value of the portfolio securities loaned, and with respect to each new loan on non-U.S. securities, collateral of at least 105% of the value of the portfolio securities loaned; and (2) at all times thereafter shall require the borrower to mark-to-market the collateral on a daily basis so that the market value of such collateral does not fall below 100% of the value of securities loaned. The Fund receives payments from borrowers equivalent to the dividends and interest that would have been earned on securities loaned while simultaneously seeking to earn income on the investment of cash collateral. There may be risks of delay in recovery of the securities should the borrower of the securities fail financially. Loans will be made, however, only to borrowers deemed by the Fund’s investment adviser to be of good standing and creditworthy under guidelines established by the Board of Trustees and when, in judgment of the adviser, the consideration which can be earned currently from these securities loans justifies the attendant risks. Loans are subject to termination by the Fund or the borrower at any time, and, therefore, are not considered to be illiquid investments. JPMorgan Chase Bank serves as custodian for the securities lending program of the Fund. JPMorgan Chase Bank receives a fee based on the value of the collateral received from borrowers. | |
Information on the investment of cash collateral is shown in the Statement of Investments. | |
As of June 30, 2007, the Fund had securities with the following value on loan: |
Value of | ||||||
Value of Loaned Securities | Collateral | |||||
$16,207,168 | $ | 16,914,082 | ||||
(j) | Distributions to Shareholders |
The Fund’s dividends from net investment income, if any, are declared and paid quarterly. The Fund’s distributions from net realized capital gains, if any, are declared and distributed at least annually. | |
Dividends and distributions to shareholders are determined in accordance with federal income tax regulations, which may differ from GAAP. These “book/tax” differences are considered either permanent or temporary in nature. In accordance with the American Institute of Certified Public Accountants Statement of Position 93-2, permanent differences (i.e., reclassification of market discounts, foreign exchange gain/loss, paydowns, and distributions from real estate investment trusts) are reclassified within the capital accounts based on their nature for federal income tax purposes; temporary differences do not require reclassification. These reclassifications have no effect upon the net asset value of the Fund. To the extent distributions exceed current and accumulated earnings and profits for federal income tax purposes, these distributions are reported as distributions of paid-in-capital. |
(k) | Federal Income Taxes |
It is the policy of the Fund to qualify or to continue to qualify as a “regulated investment company” by complying with the provisions available to certain investment companies, as defined in Subchapter M of the U.S. Internal Revenue Code, and to make distributions of net investment income and net realized capital gains sufficient to relieve the Fund from all, or substantially all, federal income taxes. |
As of June 30, 2007, the tax cost of securities and the breakdown of unrealized appreciation (depreciation) for the Fund was as follows: |
Net | ||||||||||||||||
Unrealized | ||||||||||||||||
Tax Cost of | Unrealized | Unrealized | Appreciation | |||||||||||||
Securities | Appreciation | Depreciation | (Depreciation) | |||||||||||||
$ | 287,104,851 | $ | 110,439,785 | $ | (2,301,130 | ) | $ | 108,138,655 | ||||||||
(l) | Allocation of Expenses, Income, and Gains and Losses |
Expenses directly attributable to the Fund are charged to the Fund. Expenses not directly attributable to the Fund are allocated proportionately among various or all funds within the Trust. The method used by the Fund for allocating income, fund level expenses, and realized and unrealized gains or losses is based on the fair value of shares outstanding relative to net assets. Under this method, each class of shares participates based on the total net asset value of that class’s shares in proportion to the total net assets of the Fund. Expenses specific to a class (such as Rule 12b-1 and administrative services fees) are charged to that class. |
Total | ||||||
Base Management Fee | Fees | |||||
Up to $500 million | 1.05% | |||||
Next $1.5 billion | 1.00% | |||||
Next $2 billion or more | 0.95% | |||||
Out or Underperformance | Change in Fees | |||||
+/- 1 percentage point | +/- 0.02% | |||||
+/- 2 percentage point | +/- 0.04% | |||||
+/- 3 percentage point | +/- 0.06% | |||||
+/- 4 percentage point | +/- 0.08% | |||||
+/- 5 percentage point | +/- 0.10% | |||||
Combined Fee Schedule* | ||||||
Up to $1 billion | 0.15% | |||||
$1 billion up to $3 billion | 0.10% | |||||
$3 billion up to $8 billion | 0.05% | |||||
$8 billion up to $10 billion | 0.04% | |||||
$10 billion up to $12 billion | 0.02% | |||||
$12 billion or more | 0.01% | |||||
* | The assets of the Nationwide NVIT Investor Destinations Aggressive Fund, the Nationwide NVIT Investor Destinations Moderately Aggressive Fund, the Nationwide NVIT Investor Destinations Moderate Fund, the Nationwide NVIT Investor Destinations Moderately Conservative Fund, and the Nationwide NVIT Investor Destinations Conservative Fund (collectively, the “Investor Destinations Funds”) are excluded from the Trust asset level amount in order to calculate this asset-based fee. The Investor Destinations Funds do not pay any part of this fee. |
Number of Portfolios | ||||||||||
Position(s) Held | in the | |||||||||
with the Trust | Principal Occupation(s) | Nationwide Fund | Other | |||||||
Name, Address | and Length of | During Past | Complex Overseen | Directorships | ||||||
and Year of Birth | Time Served1 | Five Years | by Trustee | Held by Trustee2 | ||||||
Charles E. Allen c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1948 | Trustee since July 2000 | Mr. Allen is Chairman, Chief Executive Officer and President of Graimark Realty Advisors, Inc. (real estate development, investment and asset management). | 89 | None | ||||||
Paula H.J. Cholmondeley c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1947 | Trustee since July 2000 | Ms. Cholmondeley was Vice President and General Manager of Sappi Fine Paper North America from April 2000 through December 2003. | 89 | Director of Dentsply International, Inc. (dental products), Ultralife Batteries, Inc., Terex Corporation (construction equipment), Minerals Technology, Inc. (specialty chemicals) and Albany International Corp. (paper industry) | ||||||
C. Brent DeVore3 c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1940 | Trustee since 1990 | Dr. DeVore is President of Otterbein College. | 89 | None | ||||||
Phyllis Kay Dryden c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1947 | Trustee since December 2004 | Ms. Dryden was a partner of Mitchell Madison, a management consulting company from January 2006 until December 2006; she is currently a consultant with the company. Ms. Dryden was formerly Managing Partner of march FIRST, a global management consulting firm. | 89 | None | ||||||
Barbara L. Hennigar c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1935 | Trustee since July 2000 | Retired. | 89 | None | ||||||
Number of Portfolios | ||||||||||
Position(s) Held | in the | |||||||||
with the Trust | Principal Occupation(s) | Nationwide Fund | Other | |||||||
Name, Address | and Length of | During Past | Complex Overseen | Directorships | ||||||
and Year of Birth | Time Served1 | Five Years | by Trustee | Held by Trustee2 | ||||||
Barbara I. Jacobs c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1950 | Trustee since December 2004 | Ms. Jacobs served as Chairman of the Board of Directors of KICAP Network Fund, a European (United Kingdom) hedge fund, from January 2001 through January 2006. From 1998-2003, Ms. Jacobs was also a Managing Director and European Portfolio Manager of CREF Investments (Teachers Insurance and Annuity Association-College Retirement Equities Fund). | 89 | None | ||||||
Douglas F. Kridler c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1955 | Trustee since September 1997 | Mr. Kridler has served as the President and Chief Executive Officer of the Columbus Foundation (a Columbus, OH-based foundation which manages over 1,300 individual endowment funds) since February 2002. Prior to January 31, 2002, Mr. Kridler was the President of the Columbus Association for the Performing Arts and Chairman of the Greater Columbus Convention and Visitors Bureau. | 89 | None | ||||||
Michael D. McCarthy c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1947 | Trustee since December 2004 | Retired. Mr. McCarthy was Chairman of VMAC (commodity swaps) from October 2002 until January 2007; and a partner of Pineville Properties LLC (a commercial real estate development firm) from September 2000 until January 2007. | 89 | None | ||||||
David C. Wetmore c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1948 | Trustee since 1995 and Chairman since February 2005 | Retired. | 89 | None | ||||||
1 | Length of time served includes time served with the Trust’s predecessors. | |
2 | Directorships held in (1) any other investment companies registered under the 1940 Act, (2) any company with a class of securities registered pursuant to Section 12 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or (3) any company subject to the requirements of Section 15(d) of the Exchange Act. | |
3 | Mr. DeVore has served as President of Otterbein College since 1984. Mark Thresher, President and Chief Operating Officer of Nationwide Financial Services, Inc. (“NFS”) has served as a member of the Board of Trustees of Otterbein College since 2000, currently serves as one of 30 of its trustees, and is currently one of two Vice Chairmen of the Board. Each of Nationwide Fund Advisors (“NFA”), the Funds’ investment adviser, and Nationwide Fund Distributors LLC (“NFD”), principal underwriter to the Trust, is a wholly-owned subsidiary of NFS. | |
Additional information regarding the Trustees and Officers may be found in the Trust’s Statement of Additional Information, which is available without charge upon request, by calling 800-848-0920. |
Number of Portfolios | ||||||||||
Position(s) Held | in the | |||||||||
with the Trust | Principal Occupation(s) | Nationwide Fund | Other | |||||||
Name, Address | and Length of | During Past | Complex Overseen | Directorships | ||||||
and Year of Birth | Time Served1 | 5 Years | by Trustee | Held by Trustee 2 | ||||||
Arden L. Shisler c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1941 | Trustee since February 2000 | Retired. Mr. Shisler is the former President and Chief Executive Officer of KeB Transport, Inc., a trucking firm (2000 through 2002). He served as a consultant to KeB from January 2003 through December 2004. Since 1992, Mr. Shisler has also been Chairman of the Board for Nationwide Mutual Insurance Company.3 | 89 | Director of Nationwide Financial Services, Inc., Chairman of Nationwide Mutual Insurance Company3 | ||||||
John H. Grady Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1961 | President & Chief Executive Officer since December 2006 | Mr. Grady is President, and Chief Executive Officer of Nationwide Funds Group which includes Nationwide Fund Advisors,3 Nationwide Fund Management LLC,3 Nationwide Fund Distributors LLC 3 and NWD Investments,2 the asset management operations of Nationwide Mutual Insurance Company, which includes Morley Capital Management, Inc.,2 Nationwide Separate Accounts LLC,2 NorthPointe Capital LLC,2 and Nationwide SA Capital Trust2. From March 2004 until March 2006, Mr. Grady was Chief Executive Officer of Constellation Investment Management Co., L.P. (registered investment adviser), and President and Chief Executive Officer of Constellation Funds Group (registered investment companies). He also was President of Constellation Investment Distribution Co., Inc. (registered broker-dealer) from March 2004 until June 2006. From February 2001 until February 2004, Mr. Grady was Chief Operating and Chief Legal Officer; Managing Director, Mutual Funds Group, Turner Investment Partners, Inc. (registered investment adviser); Executive Vice President of Turner Funds and Turner Institutional Portfolios (registered investment companies); and President, Turner Investment Distributors, Inc. (registered broker-dealer). | N/A | None | ||||||
Gerald J. Holland Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1951 | Treasurer since March 2001 | Mr. Holland is Senior Vice President—Operations for Nationwide Funds Group3. | N/A | N/A | ||||||
Number of Portfolios | ||||||||||
Position(s) Held | in the | |||||||||
with the Trust | Principal Occupation(s) | Nationwide Fund | Other | |||||||
Name, Address | and Length of | During Past | Complex Overseen | Directorships | ||||||
and Year of Birth | Time Served1 | 5 Years | by Trustee | Held by Trustee 2 | ||||||
Michael A. Krulikowski Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1959 | Chief Compliance Officer from June 2004 to August 20074 | Mr. Krulikowski is Vice President and Chief Compliance Officer of Nationwide Funds Group3, Morley Capital Management, Inc.3, Nationwide SA Capital Trust (since 1999)3, and Nationwide Separate Accounts LLC (since August 2005).3 Since June 2004, Mr. Krulikowski has also served as Chief Compliance Officer of the Trust. From November 1999 through May 2007, he served as Vice President and Chief Compliance Officer of NorthPointe Capital LLC. 3 | N/A | N/A | ||||||
Eric E. Miller Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1953 | Secretary since December 2002 | Mr. Miller is Senior Vice President, General Counsel, and Assistant Secretary for Nationwide Funds Group3 and NWD Investments.2 From August 2000 to August 2002, Mr. Miller was a Partner with Stradley Ronon Stevens & Young, LLP. | N/A | N/A | ||||||
1 | Length of time served includes time served with the Trust’s predecessors. | |
2 | Directorships held in (1) any other investment companies registered under the 1940 Act, (2) any company with a class of securities registered pursuant to Section 12 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or (3) any company subject to the requirements of Section 15(d) of the Exchange Act. | |
3 | This position is held with an affiliated person or principal underwriter of the Trust. | |
4 | Effective August 3, 2007, the Board of Trustees approved Carol Baldwin Moody as Chief Compliance Officer of the Trust. Since November 2005, Ms. Moody has been Senior Vice President, Chief Compliance Officer of Nationwide Financial Services, Nationwide Life Insurance Company, Nationwide Life and Annuity Insurance Company, and Nationwide Investment Advisors, LLC. From February 2004-November 2005, she was Chief Compliance Officer of TIAA-CREF and from April 2000-February 2004, she was Managing Director and General Counsel, TCW/ Latin America Partners, LLC and Baeza & Co., LLC. | |
Federal law requires the Trust, each of its investment advisers and sub-advisers to adopt procedures for voting proxies (“Proxy Voting Guidelines”) and to provide a summary of those Proxy Voting Guidelines used to vote the securities held by the Funds. The Funds’ proxy voting policies and procedures are available without charge (i) upon request, by calling 800-848-0920, (ii) on the Funds’ website at www.nationwidefunds.com, or (iii) on the Securities and Exchange Commission’s website at www.sec.gov. |
(i) | General Information Regarding the Board’s Review of Investment Advisory Agreements |
(ii) | Board Conclusions Regarding the Fund’s Advisory Agreement |
Number of Shares | ||||||
Fund | Cast/Not Cast | Percentages | ||||
Federated NVIT High Income Bond Fund (Formerly Federated GVIT High Income Bond Fund) | FOR AGAINST ABSTAIN TOTAL | 30,051,703.188 shares 618,245.021 shares 1,813,550.431 shares 32,483,498.640 shares | 92.514% 1.903% 5.583% | |||
NVIT International Index Fund (Formerly GVIT International Index Fund) | FOR AGAINST ABSTAIN TOTAL | 4,322,203.982 shares 2,758.318 shares 135,636.840 shares 4,460,599.140 shares | 96.897% 0.062% 3.041% | |||
NVIT International Value Fund (Formerly GVIT International Value Fund) | FOR AGAINST ABSTAIN TOTAL | 20,032,843.199 shares 333,588.902 shares 1,093,293.879 shares 21,459,725.980 shares | 93.351% 1.554% 5.095% | |||
NVIT Mid Cap Index Fund (Formerly GVIT Mid Cap Index Fund) | FOR AGAINST ABSTAIN TOTAL | 35,380,179.120 shares 631,117.844 shares 1,565,714.306 shares 37,577,011.270 shares | 94.154% 1.679% 4.167% |
Number of Shares | ||||||
Fund | Cast/Not Cast | Percentages | ||||
NVIT S&P 500 Index Fund (Formerly GVIT S&P 500 Index Fund) | FOR AGAINST ABSTAIN TOTAL | 56,119,814.230 shares 666,195.542 shares 1,944,898.888 shares 58,730,908.660 shares | 95.554% 1.134% 3.312% | |||
Nationwide Multi-Manager NVIT Small Cap Growth Fund (Formerly GVIT Small Cap Growth Fund) | FOR AGAINST ABSTAIN TOTAL | 7,632,918.513 shares 149,458.111 shares 451,583.036 shares 8,233,959.660 shares | 92.700% 1.816% 5.484% | |||
Nationwide Multi-Manager NVIT Small Cap Value Fund (Formerly GVIT Small Cap Value Fund) | FOR AGAINST ABSTAIN TOTAL | 48,649,396.525 shares 979,183.753 shares 2,786,133.102 shares 52,414,713.380 shares | 92.816% 1.868% 5.316% | |||
Nationwide Multi-Manager NVIT Small Company Fund (Formerly GVIT Small Company Fund) | FOR AGAINST ABSTAIN TOTAL | 29,903,181.700 shares 838,774.923 shares 2,006,741.307 shares 32,748,697.930 shares | 91.311% 2.561% 6.128% | |||
Gartmore NVIT Developing Markets Fund (Formerly Gartmore GVIT Developing Markets Fund) | FOR AGAINST ABSTAIN TOTAL | 21,0177,889.443 shares 424,272.958 shares 1,543,850.729 shares 23,046,013.130 shares | 91.460% 1.841% 6.699% | |||
Gartmore NVIT Emerging Markets Fund (Formerly Gartmore GVIT Emerging Markets Fund) | FOR AGAINST ABSTAIN TOTAL | 17,050,534.593 shares 526,574.722 shares 881,608.905 shares 18,458,718.220 shares | 92.371% 2.853% 4.776% | |||
Nationwide NVIT Global Financial Services Fund (Formerly Gartmore GVIT Global Financial Services Fund) | FOR AGAINST ABSTAIN TOTAL | 1,554,847.333 shares 19,539.033 shares 52,206.494 shares 1,626,592.860 shares | 95.589% 1.201% 3.210% | |||
Nationwide NVIT Global Health Sciences Fund (Formerly Gartmore GVIT Global Health Sciences Fund) | FOR AGAINST ABSTAIN TOTAL | 4,722,963.678 shares 157,979.030 shares 207,642.222 shares 5,088,584.930 shares | 92.815% 3.104% 4.081% | |||
Nationwide NVIT Global Technology and Communications Fund (Formerly Gartmore GVIT Global Technology and Communications Fund) | FOR AGAINST ABSTAIN TOTAL | 8,585,472.039 shares 102,267.977 shares 489,577.634 shares 9,177,317.650 shares | 93.551% 1.114% 5.335% | |||
Gartmore NVIT Global Utilities Fund (Formerly Gartmore GVIT Global Utilities Fund) | FOR AGAINST ABSTAIN TOTAL | 4,123,270.549 shares 122,001.533 shares 240,276.088 shares 4,485,548.170 shares | 91.923% 2.720% 5.357% | |||
Nationwide NVIT Government Bond Fund (Formerly Gartmore GVIT Government Bond Fund) | FOR AGAINST ABSTAIN TOTAL | 88,471,567.462 shares 1,825,645.181 shares 5,841,990.727 shares 96,139,203.370 shares | 92.024% 1.899% 6.077% |
Number of Shares | ||||||
Fund | Cast/Not Cast | Percentages | ||||
Nationwide NVIT Growth Fund (Formerly Gartmore GVIT Growth Fund) | FOR AGAINST ABSTAIN TOTAL | 14,931,435.904 shares 409,826.402 shares 1,259,945.064 shares 16,601,207.370 shares | 89.942% 2.469% 7.589% | |||
Gartmore NVIT International Growth Fund (Formerly Gartmore GVIT International Growth Fund) | FOR AGAINST ABSTAIN TOTAL | 6,251,419.070 shares 139,618.548 shares 290,025.592 shares 6,681,063.210 shares | 93.569% 2.090% 4.341% | |||
Nationwide NVIT Investor Destinations Aggressive Fund (Formerly Gartmore GVIT Investor Destinations Aggressive Fund) | FOR AGAINST ABSTAIN TOTAL | 49,489,224.549 shares 1,385,396.474 shares 3,696,272.337 shares 54,570,893.360 shares | 90.688% 2.539% 6.773% | |||
Nationwide NVIT Investor Destinations Conservative Fund (Formerly Gartmore GVIT Investor Destinations Conservative Fund) | FOR AGAINST ABSTAIN TOTAL | 23,091,965.887 shares 314,935,884 shares 2,292,355.179 shares 25,699,256.950 shares | 89.855% 1.225% 8.920% | |||
Nationwide NVIT Investor Destinations Moderate Fund (Formerly Gartmore GVIT Investor Destinations Moderate Fund) | FOR AGAINST ABSTAIN TOTAL | 188,902,093.059 shares 3,018,924.590 shares 16,359,690.401 shares 208,280,708.050 shares | 90.696% 1.449% 7.855% | |||
Nationwide NVIT Investor Destinations Moderately Aggressive Fund (Formerly Gartmore GVIT Investor Destinations Moderately Aggressive Fund) | FOR AGAINST ABSTAIN TOTAL | 134,792,622.920 shares 3,489,207.264 shares 9,304,197.656 shares 147,586,027.840 shares | 91.332% 2.364% 6.304% | |||
Nationwide NVIT Investor Destinations Moderately Conservative Fund (Formerly Gartmore GVIT Investor Destinations Moderately Conservative Fund) | FOR AGAINST ABSTAIN TOTAL | 49,627,123.216 shares 856,088.634 shares 3,507,215.650 shares 53,990,427.500 shares | 91.918% 1.586% 6.496% | |||
Nationwide NVIT Mid Cap Growth Fund (Formerly Gartmore GVIT Mid Cap Growth Fund) | FOR AGAINST ABSTAIN TOTAL | 10,879,584.971 shares 352,594.958 shares 717,792.971 shares 11,949,972.900 shares | 91.043% 2.950% 6.007% | |||
Nationwide NVIT Money Market Fund II (Formerly Gartmore GVIT Money Market Fund II) | FOR AGAINST ABSTAIN TOTAL | 221,774,863.241 shares 12,322,482.494 shares 16,471,740.875 shares 250,569,086.610 shares | 88.508% 4.918% 6.574% | |||
Nationwide NVIT Money Market Fund (Formerly Gartmore GVIT Money Market Fund) | FOR AGAINST ABSTAIN TOTAL | 1,578,331,008.328 shares 32,372,133.671 shares 112,652,123.301 shares 1,723,355,265.300 shares | 91.585% 1.878% 6.537% | |||
NVIT Nationwide Fund (Formerly Gartmore GVIT Nationwide Fund) | FOR AGAINST ABSTAIN TOTAL | 125,423,274.735 shares 2,767,979.467 shares 8,762,255.828 shares 136,953,510.030 shares | 91.581% 2.021% 6.398% |
Number of Shares | ||||||
Fund | Cast/Not Cast | Percentages | ||||
NVIT Nationwide Leaders Fund (Formerly Gartmore GVIT Nationwide Leaders Fund) | FOR AGAINST ABSTAIN TOTAL | 2,298,504.956 shares 29,630.469 shares 71,637.755 shares 2,399,773.180 shares | 95.780% 1.235% 2.985% | |||
Nationwide NVIT U.S. Growth Leaders Fund (Formerly Gartmore GVIT U.S. Growth Leaders Fund) | FOR AGAINST ABSTAIN TOTAL | 4,972,094.773 shares 122,623.161 shares 174,625.606 shares 5,269,343.540 shares | 94.359% 2.327% 3.314% | |||
Gartmore NVIT Worldwide Leaders Fund (Formerly Gartmore GVIT Worldwide Leaders Fund) | FOR AGAINST ABSTAIN TOTAL | 2,666,862.487 shares 47,702.491 shares 118,719.882 shares 2,833,284.860 shares | 94.126% 1.684% 4.190% | |||
JP Morgan NVIT Balanced Fund (Formerly JP Morgan GVIT Balanced Fund) | FOR AGAINST ABSTAIN TOTAL | 15,966,867.546 shares 259,004.324 shares 1,339,385.200 shares 17,565,257.070 shares | 90.900% 1.475% 7.625% | |||
Van Kampen NVIT Comstock Value Fund (Formerly Van Kampen GVIT Comstock Value Fund) | FOR AGAINST ABSTAIN TOTAL | 27,737,008.009 shares 502,564.164 shares 1,824,670.107 shares 30,064,242.280 shares | 92.259% 1.672% 6.069% | |||
Van Kampen NVIT Multi Sector Bond Fund (Formerly Van Kampen GVIT Multi Sector Bond Fund) | FOR AGAINST ABSTAIN TOTAL | 21,253,297.665 shares 484,100.920 shares 1,803,963.645 shares 23,541,362.230 shares | 90.281% 2.056% 7.663% | |||
Number of Shares | ||||||
Fund | Cast/Not Cast | Percentages | ||||
Nationwide NVIT Mid Cap Growth Fund (Formerly Gartmore GVIT Mid Cap Growth Fund) | FOR AGAINST ABSTAIN TOTAL | 10,862,827.499 shares 414,574.660 shares 672,570.741 shares 11,949,972.900 shares | 90.903% 3.469% 5.628% | |||
* | This meeting was previously adjourned on April 23, 2007. | |
** | Fund names were changed effective May 1, 2007 to reflect “Nationwide”/“NVIT” branding to coincide with the sale of Nationwide Fund Advisors, Inc. by Nationwide Corporation to its majority-owned subsidiary, Nationwide Financial Services, Inc. |
Contents | ||
6 | Statement of Investments | |
9 | Statement of Assets and Liabilities | |
10 | Statement of Operations | |
11 | Statements of Changes in Net Assets | |
13 | Financial Highlights | |
14 | Notes to Financial Statements |
SAR-IGR (8/07) | ![]() |
![-s- John H. Grady](https://capedge.com/proxy/N-CSRS/0000893220-07-003038/w37711gradyjh.gif)
Ending | ||||||||||||||||||||||
Beginning | Account | |||||||||||||||||||||
Account Value, | Value, | Expenses Paid | Annualized | |||||||||||||||||||
Gartmore NVIT International Growth Fund | January 1, 2007 | June 30, 2007 | During Period* | Expense Ratio* | ||||||||||||||||||
Class I | Actual | $ | 1,000.00 | $ | 1,144.90 | $ | 6.75 | 1.27% | ||||||||||||||
Hypothetical | 1 | $ | 1,000.00 | $ | 1,018.50 | $ | 6.38 | 1.27% | ||||||||||||||
Class III | Actual | $ | 1,000.00 | $ | 1,145.00 | $ | 6.54 | 1.23% | ||||||||||||||
Hypothetical | 1 | $ | 1,000.00 | $ | 1,018.70 | $ | 6.18 | 1.23% | ||||||||||||||
* | Expenses are equal to the Fund’s annualized expense ratio multiplied by the average account value over the period multiplied by 181/365 (to reflect the one-half year period). The expense ratio presented represents a six-month, annualized ratio in accordance with SEC guidelines. The expenses reported above do not include the effect of additional expenses imposed by variable annuity contracts. | |
1 | Represents the hypothetical 5% return before expenses. |
Asset Allocation | ||||
Common Stock | 99.1% | |||
Repurchase Agreements | 1.1% | |||
Liabilities in excess of other assets | -0.2% | |||
100.0% |
Top Holdings* | ||||
Total SA | 2.5% | |||
Komatsu Ltd. | 2.2% | |||
Royal Dutch Shell PLC | 2.2% | |||
Computershare Ltd. | 2.1% | |||
Nintendo Co. Ltd. | 2.0% | |||
MAN AG | 2.0% | |||
BG Group PLC | 2.0% | |||
Mittal Steel Co. NV | 2.0% | |||
Compagnie Generale des Etablissements Michelin | 2.0% | |||
New World Development Co. Ltd. | 1.9% | |||
Other | 79.1% | |||
100.0% |
Top Industries | ||||
Metals & Mining | 11.6% | |||
Oil, Gas & Consumable Fuels | 10.3% | |||
Automobiles | 7.7% | |||
Machinery | 5.9% | |||
Real Estate Management & Development | 5.3% | |||
Insurance | 5.1% | |||
Commercial Banks | 4.9% | |||
Auto Components | 3.3% | |||
Tobacco | 3.2% | |||
Capital Markets | 3.2% | |||
Other | 39.5% | |||
100.0% |
Top Countries | ||||
United Kingdom | 23.4% | |||
Japan | 12.4% | |||
Germany | 11.1% | |||
Switzerland | 10.5% | |||
France | 8.3% | |||
Australia | 4.0% | |||
Netherlands | 3.7% | |||
Sweden | 3.5% | |||
Italy | 3.5% | |||
United States | 3.4% | |||
Other | 16.2% | |||
100.0% |
* | For purpose of listing top holdings, repurchase agreements are included as part of Other. |
Common Stock (99.1%) | ||||||||
Shares or | ||||||||
Principal Amount | Value | |||||||
AUSTRALIA (4.0%) (a) | ||||||||
Biotechnology (1.9%) | ||||||||
CSL Ltd. | 29,680 | $ | 2,208,783 | |||||
IT Services (2.1%) | ||||||||
Computershare Ltd. | 249,200 | 2,377,240 | ||||||
4,586,023 | ||||||||
AUSTRIA (1.5%) (a) | ||||||||
Oil, Gas & Consumable Fuels (1.5%) | ||||||||
OMV AG | 26,000 | 1,734,153 | ||||||
BRAZIL (1.8%) | ||||||||
Metals & Mining (1.8%) | ||||||||
Cia Vale Do Rio Sponsored ADR | 55,490 | 2,091,973 | ||||||
CANADA (1.4%) | ||||||||
Metals & Mining (1.4%) | ||||||||
Hudbay Minerals, Inc. | 76,800 | 1,605,228 | ||||||
CAYMAN ISLANDS (1.0%) | ||||||||
Oil, Gas & Consumable Fuels (1.0%) | ||||||||
Global Santa Fe Corp. | 16,700 | 1,206,575 | ||||||
FINLAND (1.8%) (a) | ||||||||
Communications Equipment (1.8%) | ||||||||
Nokia OYJ | 74,600 | 2,094,935 | ||||||
FRANCE (8.3%) | ||||||||
Auto Components (2.0%) (a) | ||||||||
Compagnie Generale des Etablissements Michelin | 16,300 | 2,277,582 | ||||||
Chemicals (1.0%) | ||||||||
Rhodia SA (Euronext)* | 26,676 | 1,212,981 | ||||||
Electrical Equipment (1.4%) (a) | ||||||||
Alstom RGPT | 9,410 | 1,568,973 | ||||||
Oil, Gas & Consumable Fuels (2.5%) (a) | ||||||||
Total SA | 35,800 | 2,902,286 | ||||||
Textiles, Apparel & Luxury Goods (1.4%) (a) | ||||||||
LVMH Moet Hennessy Louis Vuitton SA | 14,293 | 1,644,443 | ||||||
9,606,265 | ||||||||
GERMANY (11.1%) (a) | ||||||||
Auto Components (1.3%) | ||||||||
Continental AG | 11,000 | 1,545,763 | ||||||
Automobiles (3.4%) | ||||||||
Daimler Chrysler AG | 19,400 | 1,785,643 | ||||||
Volkswagen AG | 13,570 | 2,157,830 | ||||||
3,943,473 | ||||||||
Food & Staples Retailing (1.4%) | ||||||||
Metro AG | 19,700 | 1,628,058 | ||||||
Insurance (1.5%) | ||||||||
Allianz AG | 7,500 | 1,748,791 | ||||||
Machinery (2.0%) | ||||||||
MAN AG | 16,200 | 2,312,456 | ||||||
Pharmaceutical (1.5%) | ||||||||
Merck KGAA | 12,165 | 1,664,233 | ||||||
12,842,774 | ||||||||
HONG KONG (1.9%) (a) | ||||||||
Real Estate Management & Development (1.9%) | ||||||||
New World Development Co. Ltd. | 899,000 | 2,249,900 | ||||||
ITALY (3.5%) (a) | ||||||||
Automobiles (1.9%) | ||||||||
Fiat SpA | 73,300 | 2,176,986 | ||||||
Commercial Bank (1.6%) | ||||||||
UniCredito Italiano SPA | 204,950 | 1,830,334 | ||||||
4,007,320 | ||||||||
JAPAN (12.4%) (a) | ||||||||
Automobiles (2.4%) | ||||||||
Suzuki Motor Corp. | 50,000 | 1,420,074 | ||||||
Toyota Motor Corp. | 22,300 | 1,406,552 | ||||||
2,826,626 | ||||||||
Machinery (2.2%) | ||||||||
Komatsu Ltd. | 88,000 | 2,550,823 | ||||||
Office Electronics (1.5%) | ||||||||
Canon, Inc. | 29,700 | 1,741,910 | ||||||
Real Estate Management & Development (1.7%) | ||||||||
Mitsui Fudosan Co. Ltd. | 69,000 | 1,934,190 | ||||||
Road & Rail (1.1%) | ||||||||
East Japan Railway Co. | 157 | 1,209,866 | ||||||
Software (2.0%) | ||||||||
Nintendo Co. Ltd. | 6,400 | 2,335,282 | ||||||
Tobacco (1.5%) | ||||||||
Japan Tobacco, Inc. | 360 | 1,774,745 | ||||||
14,373,442 | ||||||||
Common Stock (continued) | ||||||||
Shares or | ||||||||
Principal Amount | Value | |||||||
MALAYSIA (1.0%) (a) | ||||||||
Hotels, Restaurants & Leisure (1.0%) | ||||||||
Genting Berhard | 496,500 | $ | 1,188,977 | |||||
MEXICO (1.5%) | ||||||||
Commercial Bank (1.5%) | ||||||||
Grupo Financiero Banorte SA de CV | 391,000 | 1,790,862 | ||||||
NETHERLANDS (3.7%) (a) | ||||||||
Household Durables (1.7%) | ||||||||
Koninklijke Philips Electronics NV | 46,600 | 1,974,552 | ||||||
Metals & Mining (2.0%) | ||||||||
Mittal Steel Co. NV | 36,800 | 2,298,011 | ||||||
4,272,563 | ||||||||
REPUBLIC OF KOREA (1.3%) | ||||||||
Metals & Mining (1.3%) | ||||||||
Posco ADR | 13,000 | 1,560,000 | ||||||
RUSSIAN FEDERATION (0.5%) | ||||||||
Pharmaceutical (0.5%) | ||||||||
Pharmstandard GDR* | 31,800 | 533,604 | ||||||
SINGAPORE (2.7%) (a) | ||||||||
Airline (1.0%) | ||||||||
Singapore Airlines Ltd. | 93,000 | 1,143,142 | ||||||
Real Estate Management & Development (1.7%) | ||||||||
City Developments Ltd. | 180,000 | 2,035,284 | ||||||
3,178,426 | ||||||||
SWEDEN (3.5%) (a) | ||||||||
Commercial Bank (1.8%) | ||||||||
Skandinaviska Enskilda Banken AB | 63,600 | 2,048,366 | ||||||
Machinery (1.7%) | ||||||||
Atlas Copco AB, B Shares | 121,800 | 2,029,385 | ||||||
4,077,751 | ||||||||
SWITZERLAND (10.5%) (a) | ||||||||
Capital Markets (3.2%) | ||||||||
Credit Suisse Group | 27,110 | 1,925,041 | ||||||
Julius Baer Holding Ltd. | 24,600 | 1,760,556 | ||||||
3,685,597 | ||||||||
Commercial Services & Supplies (1.0%) | ||||||||
Adecco SA | 14,900 | 1,152,979 | ||||||
Construction Materials (1.2%) | ||||||||
Holcim Ltd. | 13,400 | 1,447,523 | ||||||
Electrical Equipment (1.7%) | ||||||||
ABB Ltd. | 85,400 | 1,926,053 | ||||||
Food Products (1.5%) | ||||||||
Nestle SA | 4,600 | 1,748,308 | ||||||
Insurance (1.9%) | ||||||||
Zurich Financial Services AG | 7,100 | 2,195,365 | ||||||
12,155,825 | ||||||||
UNITED KINGDOM (23.4%) (a) | ||||||||
Aerospace & Defense (1.2%) | ||||||||
Rolls-Royce Group PLC | 129,970 | 1,399,312 | ||||||
Airline (1.5%) | ||||||||
British Airways PLC* | 210,330 | 1,758,996 | ||||||
Chemicals (1.6%) | ||||||||
Imperial Chemical Industries PLC | 149,200 | 1,855,781 | ||||||
Independent Power Producers & Energy Traders (1.6%) | ||||||||
International Power PLC | 218,200 | 1,875,391 | ||||||
Insurance (1.7%) | ||||||||
Prudential PLC | 135,900 | 1,934,247 | ||||||
Metals & Mining (5.1%) | ||||||||
Anglo American PLC | 30,800 | 1,808,142 | ||||||
BHP Billiton PLC | 67,700 | 1,880,439 | ||||||
Xstrata PLC | 37,200 | 2,214,404 | ||||||
5,902,985 | ||||||||
Multiline Retail (2.2%) | ||||||||
Marks & Spencer Group PLC | 91,500 | 1,149,044 | ||||||
Whitbread PLC | 38,900 | 1,375,619 | ||||||
2,524,663 | ||||||||
Oil, Gas & Consumable Fuels (4.2%) | ||||||||
BG Group PLC | 140,700 | 2,306,203 | ||||||
Royal Dutch Shell PLC, A Shares | 62,100 | 2,527,089 | ||||||
4,833,292 | ||||||||
Tobacco (1.7%) | ||||||||
Imperial Tobacco Group PLC | 42,500 | 1,959,307 | ||||||
Trading Companies & Distributors (0.9%) | ||||||||
SIG PLC | 41,400 | 1,099,076 | ||||||
Water Utility (1.7%) | ||||||||
Pennon Group PLC | 162,317 | 1,995,417 | ||||||
27,138,467 | ||||||||
Common Stock (continued) | ||||||||
Principal | ||||||||
Amount | Value | |||||||
UNITED STATES (2.3%) | ||||||||
Energy Equipment & Services (1.2%) | ||||||||
Diamond Offshore Drilling, Inc. | 13,650 | $ | 1,386,294 | |||||
Oil, Gas & Consumable Fuels (1.1%) | ||||||||
Sunoco, Inc. | 16,400 | 1,306,752 | ||||||
2,693,046 | ||||||||
Total Common Stocks (Cost $95,570,916) | 114,988,109 | |||||||
Repurchase Agreements (1.1%) | ||||||||
Nomura Securities, 5.20% dated 06/29/07, due 07/02/07, repurchase price $1,302,139, collateralized by U.S. Government Agency Mortgages with a market value of $1,327,607 | $ | 1,301,575 | $ | 1,301,575 | ||||
Total Investments (Cost $96,872,491) (b) — 100.2% | 116,289,684 | |||||||
Liabilities in excess of other assets — (0.2)% | (245,465 | ) | ||||||
NET ASSETS — 100.0% | $ | 116,044,219 | ||||||
* | Denotes a non-income producing security. | |
(a) | Fair Valued Security. | |
(b) | See notes to financial statements for tax unrealized appreciation (depreciation) of securities. |
ADR | American Depository Receipt | |
GDR | Global Depository Receipt |
Currency | Unrealized | |||||||||||||||||||||
Date | Received/ | Contract | Market | Appreciation/ | ||||||||||||||||||
Currency | Delivery | (Delivered) | Value | Value | (Depreciation) | |||||||||||||||||
Short Contract: | ||||||||||||||||||||||
British Sterling Pound | 07/03/07 | (1,448,006 | ) | $ | (2,898,921 | ) | $ | (2,907,351 | ) | $ | (8,430 | ) | ||||||||||
Japanese Yen | 07/03/07 | (13,432,127 | ) | (109,325 | ) | (109,151 | ) | 174 | ||||||||||||||
Total Short Contracts | $ | (3,008,246 | ) | $ | (3,016,502 | ) | $ | (8,256 | ) | |||||||||||||
Long Contracts: | ||||||||||||||||||||||
Swiss Franc | 07/03/07 | 1,410,225 | 1,145,221 | 1,155,056 | 9,835 | |||||||||||||||||
Euro | 05/08/08 | 1,602,322 | 2,170,666 | 2,184,857 | 14,191 | |||||||||||||||||
Euro | 07/02/07 | 430,179 | 579,322 | 582,165 | 2,843 | |||||||||||||||||
Euro | 07/03/07 | 36,939 | 49,743 | 49,994 | 251 | |||||||||||||||||
British Sterling Pound | 07/03/07 | 38,059 | 76,196 | 76,415 | 219 | |||||||||||||||||
British Sterling Pound | 07/02/07 | 65,655 | 131,455 | 131,830 | 375 | |||||||||||||||||
Swedish Krone | 07/03/07 | 4,159,319 | 606,168 | 608,448 | 2,280 | |||||||||||||||||
Total Long Contracts | $ | 4,758,771 | $ | 4,788,765 | $ | 29,994 | ||||||||||||||||
Gartmore NVIT | ||||||
International | ||||||
Growth Fund | ||||||
Assets: | ||||||
Investments, at value (cost $95,570,916) | $ | 114,988,109 | ||||
Repurchase agreements, at cost and value | 1,301,575 | |||||
Total Investments | 116,289,684 | |||||
Foreign currencies, at value (cost $50,506) | 50,506 | |||||
Interest and dividends receivable | 115,875 | |||||
Receivable for capital shares issued | 30,154 | |||||
Receivable for investments sold | 4,516,539 | |||||
Unrealized appreciation on forward foreign currency contracts | 30,168 | |||||
Reclaims receivable | 66,940 | |||||
Prepaid expenses | 1,575 | |||||
Total Assets | 121,101,441 | |||||
Liabilities: | ||||||
Payable to custodian | 49,711 | |||||
Payable for investments purchased | 4,705,118 | |||||
Unrealized depreciation on forward foreign currency contracts | 8,430 | |||||
Payable for capital shares redeemed | 8,031 | |||||
Accrued expenses and other payables: | ||||||
Investment advisory fees | 256,964 | |||||
Fund administration and transfer agent fees | 8,707 | |||||
Administrative servicing fees | 1,989 | |||||
Compliance program costs | 1,129 | |||||
Other | 17,143 | |||||
Total Liabilities | 5,057,222 | |||||
Net Assets | $ | 116,044,219 | ||||
Represented by: | ||||||
Capital | $ | 87,079,805 | ||||
Accumulated net investment loss | (14,089 | ) | ||||
Accumulated net realized gains from investment transactions and foreign currency transactions | 9,539,018 | |||||
Net unrealized appreciation on investments and translation of assets and liabilities denominated in foreign currencies | 19,439,485 | |||||
Net Assets | $ | 116,044,219 | ||||
Net Assets: | ||||||
Class I Shares | $ | 18,644,951 | ||||
Class III Shares | 97,399,268 | |||||
Total | $ | 116,044,219 | ||||
Shares outstanding (unlimited number of shares authorized): | ||||||
Class I Shares | 1,472,863 | |||||
Class III Shares | 7,687,845 | |||||
Total | 9,160,708 | |||||
Net asset value and offering price per share (Net assets by class divided by shares outstanding by class, respectively.): | ||||||
Class I Shares | $ | 12.66 | ||||
Class III Shares | $ | 12.67 |
Gartmore NVIT | |||||
International | |||||
Growth Fund | |||||
INVESTMENT INCOME: | |||||
Interest income | $ | 18,377 | |||
Dividend income | 1,168,827 | ||||
Foreign tax withholding | (108,723 | ) | |||
Total Income | 1,078,481 | ||||
Expenses: | |||||
Investment advisory fees | 486,013 | ||||
Fund administration and transfer agent fees | 39,127 | ||||
Administrative servicing fees Class I Shares | 12,832 | ||||
Administrative servicing fees Class III Shares | 50,789 | ||||
Custodian fees | 12,120 | ||||
Trustee fees | 2,209 | ||||
Compliance program costs (Note 3) | 663 | ||||
Other | 23,814 | ||||
Total expenses before earnings credit | 627,567 | ||||
Earnings credit (Note 6) | (69 | ) | |||
Net Expenses | 627,498 | ||||
Net Investment Income | 450,983 | ||||
REALIZED/ UNREALIZED GAINS (LOSSES) FROM INVESTMENTS: | |||||
Net realized gains on investment transactions | 9,662,726 | ||||
Net realized losses on foreign currency transactions | (2,091 | ) | |||
Net realized gains on investment transactions and foreign currency transactions | 9,660,635 | ||||
Net change in unrealized appreciation on investments and translation of assets and liabilities denominated in foreign currencies | 3,288,968 | ||||
Net realized/unrealized gains (losses) on investments and translation of assets and liabilities denominated in foreign currencies | 12,949,603 | ||||
CHANGE IN NET ASSETS RESULTING FROM OPERATIONS | $ | 13,400,586 | |||
Gartmore NVIT | |||||||||
International Growth Fund | |||||||||
Six Months Ended | Year Ended | ||||||||
June 30, 2007 | December 31, 2006 | ||||||||
From Investment Activities: | |||||||||
Operations: | |||||||||
Net investment income | $ | 450,983 | $ | 394,337 | |||||
Net realized gains on investment transactions and foreign currency transactions | 9,660,635 | 9,444,282 | |||||||
Net change in unrealized appreciation on investments and translation of assets and liabilities denominated in foreign currencies | 3,288,968 | 9,362,360 | |||||||
Change in net assets resulting from operations | 13,400,586 | 19,200,979 | |||||||
Distributions to shareholders from: | |||||||||
Net investment income: | |||||||||
Class I | (72,351 | ) | (95,995 | ) | |||||
Class III | (392,721 | ) | (663,102 | ) | |||||
Net realized gains: | |||||||||
Class I | (1,473,604 | ) | (20,316 | ) | |||||
Class III | (7,597,748 | ) | (139,839 | ) | |||||
Change in net assets from shareholder distributions | (9,536,424 | ) | (919,252 | ) | |||||
Change in net assets from capital transactions | 21,083,168 | 28,866,534 | |||||||
Change in net assets | 24,947,330 | 47,148,261 | |||||||
Net Assets: | |||||||||
Beginning of period | 91,096,889 | 43,948,628 | |||||||
End of period | $ | 116,044,219 | $ | 91,096,889 | |||||
Accumulated net investment loss at end of period | $ | (14,089 | ) | $ | (1,252 | ) | |||
CAPITAL TRANSACTIONS: | |||||||||
Class I Shares | |||||||||
Proceeds from shares issued | $ | 7,250,242 | $ | 10,963,811 | |||||
Dividends reinvested | 1,545,953 | 116,310 | |||||||
Cost of shares redeemed (a) | (6,743,994 | ) | (4,525,152 | ) | |||||
2,052,201 | 6,554,969 | ||||||||
Class III Shares | |||||||||
Proceeds from shares issued | 17,460,877 | 39,604,056 | |||||||
Dividends reinvested | 7,990,455 | 802,936 | |||||||
Cost of shares redeemed (a) | (6,420,365 | ) | (18,095,427 | ) | |||||
19,030,967 | 22,311,565 | ||||||||
Change in net assets from capital transactions | $ | 21,083,168 | $ | 28,866,534 | |||||
Gartmore NVIT | |||||||||
International Growth Fund | |||||||||
Six Months Ended | Year Ended | ||||||||
June 30, 2007 | December 31, 2006 | ||||||||
SHARE TRANSACTIONS: | |||||||||
Class I Shares | |||||||||
Issued | 558,645 | 1,077,817 | |||||||
Reinvested | 123,086 | 11,875 | |||||||
Redeemed | (541,128 | ) | (441,805 | ) | |||||
140,603 | 647,887 | ||||||||
Class III Shares | |||||||||
Issued | 1,344,843 | 3,849,101 | |||||||
Reinvested | 635,677 | 81,924 | |||||||
Redeemed | (501,809 | ) | (1,806,122 | ) | |||||
1,478,711 | 2,124,903 | ||||||||
Total change in shares | 1,619,314 | 2,772,790 | |||||||
(a) | Includes redemption fees, if any. |
Investment Activities | Distributions | |||||||||||||||||||||||||||
Net Realized | ||||||||||||||||||||||||||||
and | ||||||||||||||||||||||||||||
Net Asset | Net | Unrealized | Total | |||||||||||||||||||||||||
Value, | Investment | Gains | from | Net | Net | |||||||||||||||||||||||
Beginning | Income | (Losses) on | Investment | Investment | realized | Total | ||||||||||||||||||||||
of Period | (Loss) | Investments | Activities | Income | gains | Distributions | ||||||||||||||||||||||
Class I Shares | ||||||||||||||||||||||||||||
For the year ended December 31, 2002 | $ | 6.14 | 0.01 | (1.50 | ) | (1.49 | ) | – | – | – | ||||||||||||||||||
For the year ended December 31, 2003 | $ | 4.66 | 0.07 | 1.59 | 1.66 | – | – | – | ||||||||||||||||||||
For the year ended December 31, 2004 | $ | 6.32 | 0.07 | 0.83 | 0.90 | (0.06 | ) | – | (0.06 | ) | ||||||||||||||||||
For the year ended December 31, 2005 | $ | 7.16 | 0.07 | 2.08 | 2.15 | (0.08 | ) | (0.02 | ) | (0.10 | ) | |||||||||||||||||
For the year ended December 31, 2006 | $ | 9.21 | 0.08 | 2.92 | 3.00 | (0.12 | ) | (0.02 | ) | (0.14 | ) | |||||||||||||||||
For the six months ended June 30, 2007 (Unaudited) | $ | 12.07 | 0.05 | 1.69 | 1.74 | (0.05 | ) | (1.10 | ) | (1.15 | ) | |||||||||||||||||
Class III Shares | ||||||||||||||||||||||||||||
Period ended December 31, 2002 (e) | $ | 5.95 | (0.01 | ) | (1.28 | ) | (1.29 | ) | – | – | – | |||||||||||||||||
For the year ended December 31, 2003 | $ | 4.67 | 0.02 | 1.63 | 1.65 | – | – | – | ||||||||||||||||||||
For the year ended December 31, 2004 | $ | 6.32 | 0.05 | 0.86 | 0.91 | (0.06 | ) | – | (0.06 | ) | ||||||||||||||||||
For the year ended December 31, 2005 | $ | 7.17 | 0.06 | 2.09 | 2.15 | (0.08 | ) | (0.02 | ) | (0.10 | ) | |||||||||||||||||
For the year ended December 31, 2006 | $ | 9.22 | 0.07 | 2.93 | 3.00 | (0.12 | ) | (0.02 | ) | (0.14 | ) | |||||||||||||||||
For the six months ended June 30, 2007 (Unaudited) | $ | 12.08 | 0.06 | 1.69 | 1.75 | (0.06 | ) | (1.10 | ) | (1.16 | ) |
[Additional columns below]
[Continued from above table, first column(s) repeated]
Ratios/Supplemental Data | ||||||||||||||||||||||||||||||||||||||
Ratio of Net | ||||||||||||||||||||||||||||||||||||||
Ratio of | Ratio of | Investment | ||||||||||||||||||||||||||||||||||||
Paid-in | Net | Expenses | Income | |||||||||||||||||||||||||||||||||||
capital | Net Assets | Ratio of | Investment | (Prior to | (Prior to | |||||||||||||||||||||||||||||||||
from | Net Asset | at End of | Expenses to | Income to | Reimbursements) | Reimbursements) | ||||||||||||||||||||||||||||||||
redemption | End Value, | Total | Period | Average Net | Average Net | to Average | to Average | Portfolio | ||||||||||||||||||||||||||||||
fees | of Period | Return (a) | (000s) | Assets (b) | Assets (b) | Net Assets (b)(c) | Net Assets (b)(c) | Turnover (d) | ||||||||||||||||||||||||||||||
Class I Shares | ||||||||||||||||||||||||||||||||||||||
For the year ended December 31, 2002 | 0.01 | $ | 4.66 | (24.10% | ) | $ | 6,859 | 1.29% | 0.53% | 1.33% | 0.49% | 257.38% | ||||||||||||||||||||||||||
For the year ended December 31, 2003 | – | $ | 6.32 | 35.62% | $ | 3,678 | 1.25% | 0.83% | (f) | (f) | 331.02% | |||||||||||||||||||||||||||
For the year ended December 31, 2004 | – | $ | 7.16 | 14.19% | $ | 3,647 | 1.33% | 0.98% | (f) | (f) | 262.03% | |||||||||||||||||||||||||||
For the year ended December 31, 2005 | – | $ | 9.21 | 30.21% | $ | 6,302 | 1.34% | 0.94% | (f) | (f) | 215.52% | |||||||||||||||||||||||||||
For the year ended December 31, 2006 | – | $ | 12.07 | 32.96% | $ | 16,082 | 1.24% | 0.41% | (f) | (f) | 169.26% | |||||||||||||||||||||||||||
For the six months ended June 30, 2007 (Unaudited) | – | $ | 12.66 | 14.49% | $ | 18,645 | 1.27% | 0.79% | 1.27% | 0.79% | 98.66% | |||||||||||||||||||||||||||
Class III Shares | ||||||||||||||||||||||||||||||||||||||
Period ended December 31, 2002 (e) | 0.01 | $ | 4.67 | (21.51% | ) | $ | 2,232 | 1.32% | 0.08% | (f) | (f) | 257.38% | ||||||||||||||||||||||||||
For the year ended December 31, 2003 | – | $ | 6.32 | 35.33% | $ | 6,912 | 1.33% | 0.24% | (f) | (f) | 331.02% | |||||||||||||||||||||||||||
For the year ended December 31, 2004 | – | $ | 7.17 | 14.35% | $ | 12,023 | 1.35% | 0.98% | (f) | (f) | 262.03% | |||||||||||||||||||||||||||
For the year ended December 31, 2005 | – | $ | 9.22 | 30.17% | $ | 37,647 | 1.33% | 0.54% | (f) | (f) | 215.52% | |||||||||||||||||||||||||||
For the year ended December 31, 2006 | – | $ | 12.08 | 32.95% | $ | 75,015 | 1.22% | 0.59% | (f) | (f) | 169.26% | |||||||||||||||||||||||||||
For the six months ended June 30, 2007 (Unaudited) | – | $ | 12.67 | 14.50% | $ | 97,399 | 1.23% | 0.91% | 1.23% | 0.91% | 98.66% |
(a) | Not annualized for periods less than one year. | |
(b) | Annualized for periods less than one year. | |
(c) | During the period, certain fees were waived and/or reimbursed. If such waivers/reimbursements had not occurred, the ratios would have been as indicated. | |
(d) | Portfolio turnover is calculated on the basis of the Fund as a whole without distinguishing among the classes of shares. | |
(e) | For the period from May 2, 2002 (commencement of operations) through December 31, 2002. | |
(f) | There were no fee reductions during the period. |
(a) | Security Valuation |
Securities for which market quotations are readily available are valued at current market value as of “Valuation Time.” Valuation Time is as of the close of regular trading on the New York Stock Exchange (usually 4 p.m. Eastern time). Equity securities are valued at the last quoted sale price or, if there is no sale price, the last quoted bid price provided by an independent pricing service approved by the Trust’s Board of Trustees (“Board of Trustees”). Securities traded on NASDAQ are valued at the NASDAQ official closing price. Prices are taken from the primary market or exchange in which each security trades. | |
Most securities listed on a foreign exchange are valued either at fair value (see description below) or at the last sale price at the close of the exchange on which the security is principally traded. Foreign securities, currencies, and other assets and liabilities denominated in foreign currencies are translated into U.S. dollars at the exchange rate of said currencies against the U.S. dollar, as of Valuation Time, as provided by an independent pricing service approved by the Board of Trustees. | |
Securities for which market quotations are not readily available, or for which an independent pricing service does not provide a value or provides a value that does not represent fair value in the judgment of the Fund’s investment adviser or designee, are valued at fair value under procedures approved by the Board of Trustees. The “Fair Value” of these securities is determined in good faith by taking into account relevant factors and surrounding circumstances. Methods utilized to obtain a “Fair Value” may include the following non-exclusive list of acceptable methods: (i) a multiple of earnings; (ii) the discount from market value of a similar, freely traded security; (iii) the yield-to-maturity for debt issues; or (iv) a consolidation of the methods. The Trust’s Valuation & Operations Committee considers a non-exclusive list of factors to arrive at the appropriate method of determining “Fair Value.” For example, fair value determinations are required for securities whose value is affected by a “significant” event that materially affects the value of a domestic or foreign security which occurs subsequent to the time of the close of the principal market on which such domestic or foreign security trades and before the Valuation Time (i.e., a “subsequent event”). Typically, |
this will involve events occurring after the close of a foreign market on which a security trades and before the next Valuation Time. | |
The Fund values foreign securities at fair value in the circumstances described below. Generally, trading in foreign securities markets is completed each day at various times prior to the Valuation Time. Due to the time differences between the closings of the relevant foreign securities exchanges and the Valuation Time for the Fund, the Fund will fair value its foreign investments when it is determined that the market quotations for the foreign investments either are not readily available or are unreliable and, therefore, do not represent fair value. When the fair value prices are utilized, these prices will attempt to reflect the impact of the U.S. financial markets’ perceptions and trading activities on the Fund’s foreign investments since the last closing prices of the foreign investments were calculated on their primary foreign securities markets or exchanges. For these purposes, the Board of Trustees has determined that movements in relevant indices or other appropriate market indicators, after the close of the foreign securities exchanges, may demonstrate that market quotations are unreliable, and may trigger fair value pricing for certain securities. Consequently, fair valuation of portfolio securities may occur on a daily basis. |
(b) | Repurchase Agreements |
The Fund may enter into repurchase agreements with an entity which is a member of the Federal Reserve System or which is a “primary dealer” (as designated by the Federal Reserve Bank of New York) in U.S. Government obligations. The repurchase price generally equals the price paid by the Fund plus interest negotiated on the basis of current short-term rates, which may be more or less than the rate on the underlying portfolio securities. The seller under a repurchase agreement is required to maintain the value of the collateral held pursuant to the agreement at a market value equal to or greater than the repurchase price (including accrued interest). Collateral subject to repurchase agreements is held by the Fund’s custodian or another qualified sub-custodian or in the Federal Reserve/ Treasury book-entry system. If the counterparty defaults and the fair value of the collateral declines, realization of the collateral by the Fund may be delayed or limited. The Fund may transfer uninvested cash balances into a pooled cash account. These balances are invested in one or more repurchase agreements, with the counterparty of Nomura Securities, which is fully collateralized by U.S. Government Agency Mortgages. |
(c) | Foreign Currency Transactions |
The accounting records of the Fund are maintained in U.S. dollars. Foreign currency amounts are translated into U.S. dollars at the current rate of exchange to determine the value of investments, assets and liabilities. The Fund may enter into foreign currency contracts in connection with purchases or sales of securities denominated in a foreign currency. Purchases and sales of securities, and income and expenses, are translated at the prevailing rate of exchange on the respective date of these transactions. The Fund does not isolate that portion of the results of operations resulting from changes in foreign exchange rates on investments from fluctuations arising from changes in market prices of securities held. These fluctuations are included with the net realized and unrealized gain or loss from investments and foreign currencies. |
(d) | Forward Foreign Currency Contracts |
The Fund may enter into forward foreign currency contracts in connection with planned purchases or sales of securities or to hedge the U.S. dollar value of portfolio securities denominated in a particular currency. The Fund could be exposed to risks if the counterparties to the contracts are unable to meet the terms of their contracts and from unanticipated movements in the value of a foreign currency relative to the U.S. dollar. Forward foreign currency contracts are valued at the current cost of covering these contracts, as provided by an independent pricing service approved by the Board of Trustees. The forward foreign currency contracts are adjusted by the daily exchange rate of the underlying currency and any gains or losses are recorded for financial statement purposes as unrealized gains or losses until the contract settlement date. |
(e) | Futures Contracts |
The Fund may invest in financial futures contracts (“futures contracts”) for the purpose of hedging its existing portfolio securities or securities that the Fund intends to purchase against fluctuations in value caused by changes in prevailing market interest rates or prices. Futures contracts may also be entered into for non-hedging purposes. | |
Upon entering into a futures contract, the Fund is required to pledge to the broker an amount of cash and/or other assets equal to a certain percentage of the contract amount (initial margin deposit). Subsequent payments, known as “variation margin,” are made each day, depending on the daily fluctuations in the fair value/market value of the underlying assets. A gain or loss equal to the daily variation margin is recognized on a daily basis. Futures contracts are valued daily at their last quoted sale price. | |
A “sale” of a futures contract means the creation of a contractual obligation to deliver the securities or foreign currency called for by the contract at a fixed price at a specified time in the future. A “purchase” of a futures contract means the creation of a contractual obligation to acquire the securities or foreign currency at a fixed price at a specified time in the future. | |
Should market conditions change unexpectedly, the Fund may not achieve the anticipated benefits of the futures contracts and may realize a loss. The use of futures transactions for hedging purposes involves the risk of imperfect correlation in movements in the price of futures contracts, interest rates, and the value of the underlying hedged assets. |
(f) | Written Options Contracts |
The Fund may write options contracts. A written option obligates the Fund to deliver (written call) or to receive (written put) a specified quantity of an underlying asset at the contract amount upon exercise by the holder of the option. When the Fund writes an option, an amount equal to the premium received by the Fund is recorded as a liability and is subsequently adjusted to the current fair value of the option written. Premiums received from writing options that expire unexercised are treated by the Fund on the expiration date as realized gains from investments. The difference between the premium and the amount paid on effecting a closing purchase transaction, as a realized loss. If a call option is exercised, the premium is added to the proceeds from the sale of the underlying security or currency in determining whether the Fund has realized a gain or loss. If a put option is exercised, the premium reduces the cost basis of the securities purchased by the Fund. Options traded on an exchange are valued at the last quoted sale price, or in the absence of a sale, the bid price provided by an independent pricing service approved by the Board of Trustees. Non-exchange traded options are valued using dealer supplied quotes. The Fund as a writer of an option bears the market risk of an unfavorable change in the price of the security underlying the written option. |
(g) | Short Sales |
The Fund is authorized to engage in short-selling of portfolio securities which obligates the Fund to replace any security that the Fund has borrowed by purchasing the security at current market value sometime in the future. The Fund will incur a loss if the price of the security increases between the date of the short sale and the date on which the Fund replaces the borrowed security. The Fund generally will realize a gain if the price of the security declines between these dates. Until the Fund replaces the borrowed security, the Fund will maintain a segregated account with cash, U.S. Government securities and/or securities held long to sufficiently cover the Fund’s short position on a daily basis. Dividends declared on securities sold short are recorded as an expense on the ex-dividend date and paid to the counterparty on the dividend pay date. |
(h) | Security Transactions and Investment Income |
Security transactions are accounted for on the date the security is purchased or sold (“trade date”). Securities gains and losses are calculated on the identified cost basis. Interest income is recognized on the accrual basis and includes, where applicable, the amortization or accretion of premium or discount. Dividend income is recorded on the ex-dividend date. |
(i) | Securities Lending |
To generate additional income, the Fund may lend its portfolio securities, up to 331/3% of the Fund, to brokers, dealers and other financial institutions provided that (1) the borrower delivers cash or securities as collateral with respect to each new loan of U.S. securities, equal to at least 102% of the value of the portfolio securities loaned, and with respect to each new loan on non-U.S. securities, collateral of at least 105% of the value of the portfolio securities loaned; and (2) at all times thereafter shall require the borrower to mark-to-market the collateral on a daily basis so that the market value of such collateral does not fall below 100% of the value of securities loaned. The Fund receives payments from borrowers equivalent to the dividends and interest that would have been earned on securities loaned while simultaneously seeking to earn income on the investment of cash collateral. There may be risks of delay in recovery of the securities should the borrower of the securities fail financially. Loans will be made, however, only to borrowers deemed by the Fund’s investment adviser to be of good standing and creditworthy under guidelines established by the Board of Trustees and when, in judgment of the adviser, the consideration which can be earned currently from these securities loans justifies the attendant risks. Loans are subject to termination by the Fund or the borrower at any time, and, therefore, are not considered to be illiquid investments. JPMorgan Chase Bank serves as custodian for the securities lending program of the Fund. JPMorgan Chase Bank receives a fee based on the value of the collateral received from borrowers. The Fund did not have securities on loan as of June 30, 2007. |
(j) | Distributions to Shareholders |
The Fund’s dividends from net investment income, if any, are declared and paid quarterly. The Fund’s distributions from net realized capital gains, if any, are declared and distributed at least annually. | |
Dividends and distributions to shareholders are determined in accordance with federal income tax regulations, which may differ from GAAP. These “book/tax” differences are considered either permanent or temporary in nature. In accordance with the American Institute of Certified Public Accountants Statement of Position 93-2, permanent differences (i.e., reclassification of market discounts, foreign exchange gain/loss, paydowns, and distributions from real estate investment trusts) are reclassified within the capital accounts based on their nature for federal income tax purposes; temporary differences do not require reclassification. These reclassifications have no effect upon the net asset value of the Fund. To the extent distributions exceed current and accumulated earnings and profits for federal income tax purposes, these distributions are reported as distributions of paid-in-capital. |
(k) | Federal Income Taxes |
It is the policy of the Fund to qualify or to continue to qualify as a “regulated investment company” by complying with the provisions available to certain investment companies, as defined in Subchapter M of the U.S. Internal Revenue Code, and to make distributions of net investment income and net realized capital gains sufficient to relieve the Fund from all, or substantially all, federal income taxes. | |
As of June 30, 2007, the tax cost of securities and the breakdown of unrealized appreciation (depreciation) for the Fund was as follows: |
Net | ||||||||||||||||
Unrealized | ||||||||||||||||
Tax Cost of | Unrealized | Unrealized | Appreciation | |||||||||||||
Securities | Appreciation | Depreciation | (Depreciation) | |||||||||||||
$ | 97,208,563 | $ | 19,403,516 | $ | (322,395 | ) | $ | 19,081,121 | ||||||||
(l) | Allocation of Expenses, Income, and Gains and Losses |
Expenses directly attributable to the Fund are charged to the Fund. Expenses not directly attributable to the Fund are allocated proportionately among various or all funds within the Trust. The method used by the Fund for allocating income, fund level expenses, and realized and unrealized gains or losses is based on the fair value of shares |
outstanding relative to net assets. Under this method, each class of shares participates based on the total net asset value of that class’s shares in proportion to the total net assets of the Fund. Expenses specific to a class (such as Rule 12b-1 and administrative services fees) are charged to that class. |
Total | ||||||
Base Management Fee | Fees | |||||
Up to $500 million | 0.90% | |||||
$500 million up to $2 billion | 0.85% | |||||
$2 billion or more | 0.80% | |||||
Out or Underperformance | Change in Fees | |||||
+/- 1 percentage point | +/- 0.02% | |||||
+/- 2 percentage point | +/- 0.04% | |||||
+/- 3 percentage point | +/- 0.06% | |||||
+/- 4 percentage point | +/- 0.08% | |||||
+/- 5 percentage point | +/- 0.10% | |||||
Combined Fee Schedule* | ||||||
Up to $1 billion | 0.15% | |||||
$1 billion up to $3 billion | 0.10% | |||||
$3 billion up to $8 billion | 0.05% | |||||
$8 billion up to $10 billion | 0.04% | |||||
$10 billion up to $12 billion | 0.02% | |||||
$12 billion or more | 0.01% | |||||
* | The assets of the Nationwide NVIT Investor Destinations Aggressive Fund, the Nationwide NVIT Investor Destinations Moderately Aggressive Fund, the Nationwide NVIT Investor Destinations Moderate Fund, the Nationwide NVIT Investor Destinations Moderately Conservative Fund, and the Nationwide NVIT Investor Destinations Conservative Fund (collectively, the “Investor Destinations Funds”) are excluded from the Trust asset level amount in order to calculate this asset-based fee. The Investor Destinations Funds do not pay any part of this fee. |
Number of Portfolios | ||||||||||
Position(s) Held | in the | |||||||||
with the Trust | Principal Occupation(s) | Nationwide Fund | Other | |||||||
Name, Address | and Length of | During Past | Complex Overseen | Directorships | ||||||
and Year of Birth | Time Served1 | Five Years | by Trustee | Held by Trustee2 | ||||||
Charles E. Allen c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1948 | Trustee since July 2000 | Mr. Allen is Chairman, Chief Executive Officer and President of Graimark Realty Advisors, Inc. (real estate development, investment and asset management). | 89 | None | ||||||
Paula H.J. Cholmondeley c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1947 | Trustee since July 2000 | Ms. Cholmondeley was Vice President and General Manager of Sappi Fine Paper North America from April 2000 through December 2003. | 89 | Director of Dentsply International, Inc. (dental products), Ultralife Batteries, Inc., Terex Corporation (construction equipment), Minerals Technology, Inc. (specialty chemicals) and Albany International Corp. (paper industry) | ||||||
C. Brent DeVore3 c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1940 | Trustee since 1990 | Dr. DeVore is President of Otterbein College. | 89 | None | ||||||
Phyllis Kay Dryden c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1947 | Trustee since December 2004 | Ms. Dryden was a partner of Mitchell Madison, a management consulting company from January 2006 until December 2006; she is currently a consultant with the company. Ms. Dryden was formerly Managing Partner of march FIRST, a global management consulting firm. | 89 | None | ||||||
Barbara L. Hennigar c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1935 | Trustee since July 2000 | Retired. | 89 | None | ||||||
Number of Portfolios | ||||||||||
Position(s) Held | in the | |||||||||
with the Trust | Principal Occupation(s) | Nationwide Fund | Other | |||||||
Name, Address | and Length of | During Past | Complex Overseen | Directorships | ||||||
and Year of Birth | Time Served1 | Five Years | by Trustee | Held by Trustee2 | ||||||
Barbara I. Jacobs c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1950 | Trustee since December 2004 | Ms. Jacobs served as Chairman of the Board of Directors of KICAP Network Fund, a European (United Kingdom) hedge fund, from January 2001 through January 2006. From 1998-2003, Ms. Jacobs was also a Managing Director and European Portfolio Manager of CREF Investments (Teachers Insurance and Annuity Association-College Retirement Equities Fund). | 89 | None | ||||||
Douglas F. Kridler c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1955 | Trustee since September 1997 | Mr. Kridler has served as the President and Chief Executive Officer of the Columbus Foundation (a Columbus, OH-based foundation which manages over 1,300 individual endowment funds) since February 2002. Prior to January 31, 2002, Mr. Kridler was the President of the Columbus Association for the Performing Arts and Chairman of the Greater Columbus Convention and Visitors Bureau. | 89 | None | ||||||
Michael D. McCarthy c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1947 | Trustee since December 2004 | Retired. Mr. McCarthy was Chairman of VMAC (commodity swaps) from October 2002 until January 2007; and a partner of Pineville Properties LLC (a commercial real estate development firm) from September 2000 until January 2007. | 89 | None | ||||||
David C. Wetmore c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1948 | Trustee since 1995 and Chairman since February 2005 | Retired. | 89 | None | ||||||
1 | Length of time served includes time served with the Trust’s predecessors. | |
2 | Directorships held in (1) any other investment companies registered under the 1940 Act, (2) any company with a class of securities registered pursuant to Section 12 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or (3) any company subject to the requirements of Section 15(d) of the Exchange Act. | |
3 | Mr. DeVore has served as President of Otterbein College since 1984. Mark Thresher, President and Chief Operating Officer of Nationwide Financial Services, Inc. (“NFS”) has served as a member of the Board of Trustees of Otterbein College since 2000, currently serves as one of 30 of its trustees, and is currently one of two Vice Chairmen of the Board. Each of Nationwide Fund Advisors (“NFA”), the Funds’ investment adviser, and Nationwide Fund Distributors LLC (“NFD”), principal underwriter to the Trust, is a wholly-owned subsidiary of NFS. | |
Additional information regarding the Trustees and Officers may be found in the Trust’s Statement of Additional Information, which is available without charge upon request, by calling 800-848-0920. |
Number of Portfolios | ||||||||||
Position(s) Held | in the | |||||||||
with the Trust | Principal Occupation(s) | Nationwide Fund | Other | |||||||
Name, Address | and Length of | During Past | Complex Overseen | Directorships | ||||||
and Year of Birth | Time Served1 | 5 Years | by Trustee | Held by Trustee 2 | ||||||
Arden L. Shisler c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1941 | Trustee since February 2000 | Retired. Mr. Shisler is the former President and Chief Executive Officer of KeB Transport, Inc., a trucking firm (2000 through 2002). He served as a consultant to KeB from January 2003 through December 2004. Since 1992, Mr. Shisler has also been Chairman of the Board for Nationwide Mutual Insurance Company.3 | 89 | Director of Nationwide Financial Services, Inc., Chairman of Nationwide Mutual Insurance Company3 | ||||||
John H. Grady Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1961 | President & Chief Executive Officer since December 2006 | Mr. Grady is President, and Chief Executive Officer of Nationwide Funds Group which includes Nationwide Fund Advisors,3 Nationwide Fund Management LLC,3 Nationwide Fund Distributors LLC 3 and NWD Investments,2 the asset management operations of Nationwide Mutual Insurance Company, which includes Morley Capital Management, Inc.,2 Nationwide Separate Accounts LLC,2 NorthPointe Capital LLC,2 and Nationwide SA Capital Trust2. From March 2004 until March 2006, Mr. Grady was Chief Executive Officer of Constellation Investment Management Co., L.P. (registered investment adviser), and President and Chief Executive Officer of Constellation Funds Group (registered investment companies). He also was President of Constellation Investment Distribution Co., Inc. (registered broker-dealer) from March 2004 until June 2006. From February 2001 until February 2004, Mr. Grady was Chief Operating and Chief Legal Officer; Managing Director, Mutual Funds Group, Turner Investment Partners, Inc. (registered investment adviser); Executive Vice President of Turner Funds and Turner Institutional Portfolios (registered investment companies); and President, Turner Investment Distributors, Inc. (registered broker-dealer). | N/A | None | ||||||
Gerald J. Holland Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1951 | Treasurer since March 2001 | Mr. Holland is Senior Vice President—Operations for Nationwide Funds Group3. | N/A | N/A | ||||||
Number of Portfolios | ||||||||||
Position(s) Held | in the | |||||||||
with the Trust | Principal Occupation(s) | Nationwide Fund | Other | |||||||
Name, Address | and Length of | During Past | Complex Overseen | Directorships | ||||||
and Year of Birth | Time Served1 | 5 Years | by Trustee | Held by Trustee 2 | ||||||
Michael A. Krulikowski Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1959 | Chief Compliance Officer from June 2004 to August 20074 | Mr. Krulikowski is Vice President and Chief Compliance Officer of Nationwide Funds Group3, Morley Capital Management, Inc.3, Nationwide SA Capital Trust (since 1999)3, and Nationwide Separate Accounts LLC (since August 2005).3 Since June 2004, Mr. Krulikowski has also served as Chief Compliance Officer of the Trust. From November 1999 through May 2007, he served as Vice President and Chief Compliance Officer of NorthPointe Capital LLC. 3 | N/A | N/A | ||||||
Eric E. Miller Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1953 | Secretary since December 2002 | Mr. Miller is Senior Vice President, General Counsel, and Assistant Secretary for Nationwide Funds Group3 and NWD Investments.2 From August 2000 to August 2002, Mr. Miller was a Partner with Stradley Ronon Stevens & Young, LLP. | N/A | N/A | ||||||
1 | Length of time served includes time served with the Trust’s predecessors. | |
2 | Directorships held in (1) any other investment companies registered under the 1940 Act, (2) any company with a class of securities registered pursuant to Section 12 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or (3) any company subject to the requirements of Section 15(d) of the Exchange Act. | |
3 | This position is held with an affiliated person or principal underwriter of the Trust. | |
4 | Effective August 3, 2007, the Board of Trustees approved Carol Baldwin Moody as Chief Compliance Officer of the Trust. Since November 2005, Ms. Moody has been Senior Vice President, Chief Compliance Officer of Nationwide Financial Services, Nationwide Life Insurance Company, Nationwide Life and Annuity Insurance Company, and Nationwide Investment Advisors, LLC. From February 2004-November 2005, she was Chief Compliance Officer of TIAA-CREF and from April 2000-February 2004, she was Managing Director and General Counsel, TCW/ Latin America Partners, LLC and Baeza & Co., LLC. | |
Federal law requires the Trust, each of its investment advisers and sub-advisers to adopt procedures for voting proxies (“Proxy Voting Guidelines”) and to provide a summary of those Proxy Voting Guidelines used to vote the securities held by the Funds. The Funds’ proxy voting policies and procedures are available without charge (i) upon request, by calling 800-848-0920, (ii) on the Funds’ website at www.nationwidefunds.com, or (iii) on the Securities and Exchange Commission’s website at www.sec.gov. |
(i) | General Information Regarding the Board’s Review of Investment Advisory Agreements |
(ii) | Board Conclusions Regarding the Fund’s Advisory Agreement |
Number of Shares | ||||||
Fund | Cast/Not Cast | Percentages | ||||
Federated NVIT High Income Bond Fund (Formerly Federated GVIT High Income Bond Fund) | FOR AGAINST ABSTAIN TOTAL | 30,051,703.188 shares 618,245.021 shares 1,813,550.431 shares 32,483,498.640 shares | 92.514% 1.903% 5.583% | |||
NVIT International Index Fund (Formerly GVIT International Index Fund) | FOR AGAINST ABSTAIN TOTAL | 4,322,203.982 shares 2,758.318 shares 135,636.840 shares 4,460,599.140 shares | 96.897% 0.062% 3.041% | |||
NVIT International Value Fund (Formerly GVIT International Value Fund) | FOR AGAINST ABSTAIN TOTAL | 20,032,843.199 shares 333,588.902 shares 1,093,293.879 shares 21,459,725.980 shares | 93.351% 1.554% 5.095% | |||
NVIT Mid Cap Index Fund (Formerly GVIT Mid Cap Index Fund) | FOR AGAINST ABSTAIN TOTAL | 35,380,179.120 shares 631,117.844 shares 1,565,714.306 shares 37,577,011.270 shares | 94.154% 1.679% 4.167% |
Number of Shares | ||||||
Fund | Cast/Not Cast | Percentages | ||||
NVIT S&P 500 Index Fund (Formerly GVIT S&P 500 Index Fund) | FOR AGAINST ABSTAIN TOTAL | 56,119,814.230 shares 666,195.542 shares 1,944,898.888 shares 58,730,908.660 shares | 95.554% 1.134% 3.312% | |||
Nationwide Multi-Manager NVIT Small Cap Growth Fund (Formerly GVIT Small Cap Growth Fund) | FOR AGAINST ABSTAIN TOTAL | 7,632,918.513 shares 149,458.111 shares 451,583.036 shares 8,233,959.660 shares | 92.700% 1.816% 5.484% | |||
Nationwide Multi-Manager NVIT Small Cap Value Fund (Formerly GVIT Small Cap Value Fund) | FOR AGAINST ABSTAIN TOTAL | 48,649,396.525 shares 979,183.753 shares 2,786,133.102 shares 52,414,713.380 shares | 92.816% 1.868% 5.316% | |||
Nationwide Multi-Manager NVIT Small Company Fund (Formerly GVIT Small Company Fund) | FOR AGAINST ABSTAIN TOTAL | 29,903,181.700 shares 838,774.923 shares 2,006,741.307 shares 32,748,697.930 shares | 91.311% 2.561% 6.128% | |||
Gartmore NVIT Developing Markets Fund (Formerly Gartmore GVIT Developing Markets Fund) | FOR AGAINST ABSTAIN TOTAL | 21,0177,889.443 shares 424,272.958 shares 1,543,850.729 shares 23,046,013.130 shares | 91.460% 1.841% 6.699% | |||
Gartmore NVIT Emerging Markets Fund (Formerly Gartmore GVIT Emerging Markets Fund) | FOR AGAINST ABSTAIN TOTAL | 17,050,534.593 shares 526,574.722 shares 881,608.905 shares 18,458,718.220 shares | 92.371% 2.853% 4.776% | |||
Nationwide NVIT Global Financial Services Fund (Formerly Gartmore GVIT Global Financial Services Fund) | FOR AGAINST ABSTAIN TOTAL | 1,554,847.333 shares 19,539.033 shares 52,206.494 shares 1,626,592.860 shares | 95.589% 1.201% 3.210% | |||
Nationwide NVIT Global Health Sciences Fund (Formerly Gartmore GVIT Global Health Sciences Fund) | FOR AGAINST ABSTAIN TOTAL | 4,722,963.678 shares 157,979.030 shares 207,642.222 shares 5,088,584.930 shares | 92.815% 3.104% 4.081% | |||
Nationwide NVIT Global Technology and Communications Fund (Formerly Gartmore GVIT Global Technology and Communications Fund) | FOR AGAINST ABSTAIN TOTAL | 8,585,472.039 shares 102,267.977 shares 489,577.634 shares 9,177,317.650 shares | 93.551% 1.114% 5.335% | |||
Gartmore NVIT Global Utilities Fund (Formerly Gartmore GVIT Global Utilities Fund) | FOR AGAINST ABSTAIN TOTAL | 4,123,270.549 shares 122,001.533 shares 240,276.088 shares 4,485,548.170 shares | 91.923% 2.720% 5.357% | |||
Nationwide NVIT Government Bond Fund (Formerly Gartmore GVIT Government Bond Fund) | FOR AGAINST ABSTAIN TOTAL | 88,471,567.462 shares 1,825,645.181 shares 5,841,990.727 shares 96,139,203.370 shares | 92.024% 1.899% 6.077% |
Number of Shares | ||||||
Fund | Cast/Not Cast | Percentages | ||||
Nationwide NVIT Growth Fund (Formerly Gartmore GVIT Growth Fund) | FOR AGAINST ABSTAIN TOTAL | 14,931,435.904 shares 409,826.402 shares 1,259,945.064 shares 16,601,207.370 shares | 89.942% 2.469% 7.589% | |||
Gartmore NVIT International Growth Fund (Formerly Gartmore GVIT International Growth Fund) | FOR AGAINST ABSTAIN TOTAL | 6,251,419.070 shares 139,618.548 shares 290,025.592 shares 6,681,063.210 shares | 93.569% 2.090% 4.341% | |||
Nationwide NVIT Investor Destinations Aggressive Fund (Formerly Gartmore GVIT Investor Destinations Aggressive Fund) | FOR AGAINST ABSTAIN TOTAL | 49,489,224.549 shares 1,385,396.474 shares 3,696,272.337 shares 54,570,893.360 shares | 90.688% 2.539% 6.773% | |||
Nationwide NVIT Investor Destinations Conservative Fund (Formerly Gartmore GVIT Investor Destinations Conservative Fund) | FOR AGAINST ABSTAIN TOTAL | 23,091,965.887 shares 314,935,884 shares 2,292,355.179 shares 25,699,256.950 shares | 89.855% 1.225% 8.920% | |||
Nationwide NVIT Investor Destinations Moderate Fund (Formerly Gartmore GVIT Investor Destinations Moderate Fund) | FOR AGAINST ABSTAIN TOTAL | 188,902,093.059 shares 3,018,924.590 shares 16,359,690.401 shares 208,280,708.050 shares | 90.696% 1.449% 7.855% | |||
Nationwide NVIT Investor Destinations Moderately Aggressive Fund (Formerly Gartmore GVIT Investor Destinations Moderately Aggressive Fund) | FOR AGAINST ABSTAIN TOTAL | 134,792,622.920 shares 3,489,207.264 shares 9,304,197.656 shares 147,586,027.840 shares | 91.332% 2.364% 6.304% | |||
Nationwide NVIT Investor Destinations Moderately Conservative Fund (Formerly Gartmore GVIT Investor Destinations Moderately Conservative Fund) | FOR AGAINST ABSTAIN TOTAL | 49,627,123.216 shares 856,088.634 shares 3,507,215.650 shares 53,990,427.500 shares | 91.918% 1.586% 6.496% | |||
Nationwide NVIT Mid Cap Growth Fund (Formerly Gartmore GVIT Mid Cap Growth Fund) | FOR AGAINST ABSTAIN TOTAL | 10,879,584.971 shares 352,594.958 shares 717,792.971 shares 11,949,972.900 shares | 91.043% 2.950% 6.007% | |||
Nationwide NVIT Money Market Fund II (Formerly Gartmore GVIT Money Market Fund II) | FOR AGAINST ABSTAIN TOTAL | 221,774,863.241 shares 12,322,482.494 shares 16,471,740.875 shares 250,569,086.610 shares | 88.508% 4.918% 6.574% | |||
Nationwide NVIT Money Market Fund (Formerly Gartmore GVIT Money Market Fund) | FOR AGAINST ABSTAIN TOTAL | 1,578,331,008.328 shares 32,372,133.671 shares 112,652,123.301 shares 1,723,355,265.300 shares | 91.585% 1.878% 6.537% | |||
NVIT Nationwide Fund (Formerly Gartmore GVIT Nationwide Fund) | FOR AGAINST ABSTAIN TOTAL | 125,423,274.735 shares 2,767,979.467 shares 8,762,255.828 shares 136,953,510.030 shares | 91.581% 2.021% 6.398% |
Number of Shares | ||||||
Fund | Cast/Not Cast | Percentages | ||||
NVIT Nationwide Leaders Fund (Formerly Gartmore GVIT Nationwide Leaders Fund) | FOR AGAINST ABSTAIN TOTAL | 2,298,504.956 shares 29,630.469 shares 71,637.755 shares 2,399,773.180 shares | 95.780% 1.235% 2.985% | |||
Nationwide NVIT U.S. Growth Leaders Fund (Formerly Gartmore GVIT U.S. Growth Leaders Fund) | FOR AGAINST ABSTAIN TOTAL | 4,972,094.773 shares 122,623.161 shares 174,625.606 shares 5,269,343.540 shares | 94.359% 2.327% 3.314% | |||
Gartmore NVIT Worldwide Leaders Fund (Formerly Gartmore GVIT Worldwide Leaders Fund) | FOR AGAINST ABSTAIN TOTAL | 2,666,862.487 shares 47,702.491 shares 118,719.882 shares 2,833,284.860 shares | 94.126% 1.684% 4.190% | |||
JP Morgan NVIT Balanced Fund (Formerly JP Morgan GVIT Balanced Fund) | FOR AGAINST ABSTAIN TOTAL | 15,966,867.546 shares 259,004.324 shares 1,339,385.200 shares 17,565,257.070 shares | 90.900% 1.475% 7.625% | |||
Van Kampen NVIT Comstock Value Fund (Formerly Van Kampen GVIT Comstock Value Fund) | FOR AGAINST ABSTAIN TOTAL | 27,737,008.009 shares 502,564.164 shares 1,824,670.107 shares 30,064,242.280 shares | 92.259% 1.672% 6.069% | |||
Van Kampen NVIT Multi Sector Bond Fund (Formerly Van Kampen GVIT Multi Sector Bond Fund) | FOR AGAINST ABSTAIN TOTAL | 21,253,297.665 shares 484,100.920 shares 1,803,963.645 shares 23,541,362.230 shares | 90.281% 2.056% 7.663% | |||
Number of Shares | ||||||
Fund | Cast/Not Cast | Percentages | ||||
Nationwide NVIT Mid Cap Growth Fund (Formerly Gartmore GVIT Mid Cap Growth Fund) | FOR AGAINST ABSTAIN TOTAL | 10,862,827.499 shares 414,574.660 shares 672,570.741 shares 11,949,972.900 shares | 90.903% 3.469% 5.628% | |||
* | This meeting was previously adjourned on April 23, 2007. | |
** | Fund names were changed effective May 1, 2007 to reflect “Nationwide”/“NVIT” branding to coincide with the sale of Nationwide Fund Advisors, Inc. by Nationwide Corporation to its majority-owned subsidiary, Nationwide Financial Services, Inc. |
Contents | ||
6 | Statement of Investments | |
8 | Statement of Assets and Liabilities | |
9 | Statement of Operations | |
10 | Statements of Changes in Net Assets | |
12 | Financial Highlights | |
14 | Notes to Financial Statements |
SAR-GHS (8/07) | ![]() |
![-s- John H. Grady](https://capedge.com/proxy/N-CSRS/0000893220-07-003038/w37711gradyjh.gif)
Beginning | Ending | |||||||||||||||||||||
Account Value, | Account Value | Expenses Paid | Annualized | |||||||||||||||||||
Nationwide NVIT Global Health Sciences Fund | January 1, 2007 | June 30, 2007 | During Period* | Expense Ratio* | ||||||||||||||||||
Class I | Actual | $ | 1,000.00 | $ | 1,071.20 | $ | 5.85 | 1.14% | ||||||||||||||
Hypothetical | 1 | $ | 1,000.00 | $ | 1,019.15 | $ | 5.72 | 1.14% | ||||||||||||||
Class II | Actual | $ | 1,000.00 | $ | 1,070.90 | $ | 7.24 | 1.41% | ||||||||||||||
Hypothetical | 1 | $ | 1,000.00 | $ | 1,017.81 | $ | 7.08 | 1.41% | ||||||||||||||
Class III | Actual | $ | 1,000.00 | $ | 1,072.00 | $ | 5.96 | 1.16% | ||||||||||||||
Hypothetical | 1 | $ | 1,000.00 | $ | 1,019.05 | $ | 5.82 | 1.16% | ||||||||||||||
Class VI | Actual | $ | 1,000.00 | $ | 1,070.40 | $ | 7.24 | 1.41% | ||||||||||||||
Hypothetical | 1 | $ | 1,000.00 | $ | 1,017.81 | $ | 7.08 | 1.41% | ||||||||||||||
* | Expenses are equal to the Fund’s annualized expense ratio multiplied by the average account value over the period multiplied by 181/365 (to reflect the one-half year period). The expense ratio presented represents a six-month, annualized ratio in accordance with SEC guidelines. The expenses reported above do not include the effect of additional expenses imposed by variable annuity contracts. | |
1 | Represents the hypothetical 5% return before expenses. |
Asset Allocation | ||||
Common Stock | 100.1% | |||
Repurchase Agreements | 0.2% | |||
Other Investments* | 8.9% | |||
Liabilities in excess of other assets** | -9.2% | |||
100.0% |
Top Holdings*** | ||||
Merck & Co., Inc. | 6.3% | |||
Pfizer, Inc. | 5.9% | |||
Johnson & Johnson | 5.6% | |||
Wyeth | 4.6% | |||
Gilead Sciences, Inc. | 4.3% | |||
Bristol-Myers Squibb Co. | 4.1% | |||
UnitedHealth Group, Inc. | 3.8% | |||
Baxter International, Inc. | 3.8% | |||
Amgen, Inc. | 3.5% | |||
Schering-Plough Corp. | 3.2% | |||
Other | 54.9% | |||
100.0% |
Top Industries | ||||
Pharmaceuticals | 38.7% | |||
Biotechnology | 19.1% | |||
Health Care Providers & Services | 17.0% | |||
Health Care Equipment & Supplies | 16.8% | |||
Life Sciences Tools & Services | 5.3% | |||
Food & Staples Retailing | 1.3% | |||
Chemicals | 0.7% | |||
Commercial Services & Supplies | 0.7% | |||
Health Care Technology | 0.5% | |||
Other | -0.1% | |||
100.0% |
* | Includes value of collateral received from securities lending. |
** | Includes value of collateral owed from securities lending. |
*** | For purpose of listing top holdings, repurchase agreements are included as part of Other. |
Common Stock (100.1%) | ||||||||
Shares or | ||||||||
Principal Amount | Value | |||||||
Biotechnology (19.1%) | ||||||||
Amgen, Inc.* | 37,900 | $ | 2,095,491 | |||||
Applera Corp. | 17,700 | 540,558 | ||||||
Array BioPharma, Inc.* (a) | 19,390 | 226,281 | ||||||
Biogen, Inc.* | 16,450 | 880,075 | ||||||
Celgene Corp.* | 17,340 | 994,102 | ||||||
Cephalon, Inc.* | 3,120 | 250,817 | ||||||
Genentech, Inc.* | 17,540 | 1,327,077 | ||||||
Genzyme Corp.* | 21,750 | 1,400,700 | ||||||
Gilead Sciences, Inc.* | 66,816 | 2,590,456 | ||||||
PerkinElmer, Inc. | 23,840 | 621,270 | ||||||
Pharmion Corp.* | 18,760 | 543,102 | ||||||
11,469,929 | ||||||||
Chemicals (0.7%) | ||||||||
Sigma-Aldrich Corp. | 10,200 | 435,234 | ||||||
Commercial Services & Supplies (0.7%) | ||||||||
Stericycle, Inc.* | 9,070 | 403,252 | ||||||
Food & Staples Retailing (1.3%) | ||||||||
CVS/ Caremark Corp. | 20,638 | 752,255 | ||||||
Health Care Equipment & Supplies (16.8%) | ||||||||
Advanced Medical Optics, Inc.* | 8,000 | 279,040 | ||||||
Alcon, Inc. — CH | 2,300 | 310,293 | ||||||
Bard (C.R.), Inc. | 2,958 | 244,420 | ||||||
Baxter International, Inc. | 40,500 | 2,281,770 | ||||||
Becton, Dickinson & Co. | 3,280 | 244,360 | ||||||
Boston Scientific Corp.* | 23,020 | 353,127 | ||||||
Cerus Corp.* (a) | 25,120 | 169,811 | ||||||
Cytyc Corp.* | 6,600 | 284,526 | ||||||
Dentsply International, Inc. | 8,620 | 329,801 | ||||||
Gen-Probe, Inc.* (a) | 6,670 | 403,001 | ||||||
Hologic, Inc.* | 7,440 | 411,506 | ||||||
Hospira, Inc.* | 11,880 | 463,795 | ||||||
IDEXX Laboratories, Inc.* | 3,500 | 331,205 | ||||||
Insulet Corp.* | 4,300 | 61,060 | ||||||
Intuitive Surgical, Inc.* | 1,440 | 199,829 | ||||||
Inverness Medical Innovations, Inc.* (a) | 11,240 | 573,465 | ||||||
Matria Healthcare, Inc.* (a) | 3,970 | 120,212 | ||||||
Medtronic, Inc. | 33,340 | 1,729,012 | ||||||
St. Jude Medical, Inc.* | 7,200 | 298,728 | ||||||
Steris Corp. (a) | 9,630 | 294,678 | ||||||
Tomotherapy, Inc.* | 5,700 | 124,944 | ||||||
Xtent, Inc.* (a) | 19,870 | 198,700 | ||||||
Zimmer Holdings, Inc.* | 4,250 | 360,783 | ||||||
10,068,066 | ||||||||
Health Care Providers & Services (17.0%) | ||||||||
Aetna, Inc. | 22,580 | 1,115,452 | ||||||
Amedisys, Inc.* | 6,630 | 240,868 | ||||||
Cardinal Health, Inc. | 12,816 | 905,322 | ||||||
Coventry Health Care, Inc.* | 6,740 | 388,561 | ||||||
Manor Care, Inc. | 13,840 | 903,614 | ||||||
McKesson Corp. | 8,730 | 520,657 | ||||||
Medco Health Solutions, Inc.* | 8,500 | 662,915 | ||||||
Psychiatric Solutions, Inc.* | 11,720 | 424,967 | ||||||
Quest Diagnostics, Inc. | 8,220 | 424,563 | ||||||
Skilled Healthcare Group, Inc.* (a) | 6,010 | 93,215 | ||||||
Sun Healthcare Group, Inc.* | 21,667 | 313,955 | ||||||
UnitedHealth Group, Inc. | 44,800 | 2,291,072 | ||||||
WellPoint, Inc.* | 23,990 | 1,915,122 | ||||||
10,200,283 | ||||||||
Health Care Technology (0.5%) (a) | ||||||||
TriZetto Group, Inc. (The)* | 16,330 | 316,149 | ||||||
�� | ||||||||
Life Sciences Tools & Services (5.3%) | ||||||||
Bruker Bioscience Corp.* (a) | 34,200 | 308,142 | ||||||
Charles River Laboratories International, Inc.* | 5,160 | 266,359 | ||||||
Covance, Inc.* | 11,649 | 798,655 | ||||||
Illumina, Inc.* (a) | 5,550 | 225,275 | ||||||
Pharmaceutical Product Development, Inc. | 16,540 | 632,986 | ||||||
Thermo Fisher Scientific, Inc.* | 18,510 | 957,337 | ||||||
3,188,754 | ||||||||
Pharmaceuticals (38.7%) | ||||||||
Abbott Laboratories | 27,300 | 1,461,915 | ||||||
Allergan, Inc. | 15,580 | 898,031 | ||||||
Astellas Pharma, Inc. | 8,600 | 374,123 | ||||||
Barr Pharmaceuticals, Inc.* | 5,220 | 262,201 | ||||||
Bristol-Myers Squibb Co. | 77,510 | 2,446,216 | ||||||
Dyax Corp.* (a) | 29,080 | 121,845 | ||||||
Eli Lilly & Co. | 10,720 | 599,034 | ||||||
Johnson & Johnson | 53,998 | 3,327,357 | ||||||
Merck & Co., Inc. | 75,936 | 3,781,613 | ||||||
Pfizer, Inc. | 139,272 | 3,561,185 | ||||||
Sanofi-Aventis | 2,050 | 165,596 | ||||||
Schering-Plough Corp. | 63,498 | 1,932,879 | ||||||
Shire PLC | 13,600 | 335,670 | ||||||
Shire PLC ADR — GB | 2,200 | 163,086 | ||||||
Teva Pharmaceutical Industries Ltd. ADR — IL | 18,990 | 783,337 |
Common Stock (continued) | ||||||||
Principal | ||||||||
Amount | Value | |||||||
Pharmaceuticals (continued) | ||||||||
Valeant Pharmaceuticals International (a) | 14,300 | $ | 238,667 | |||||
Wyeth | 48,395 | 2,774,969 | ||||||
23,227,724 | ||||||||
Total Common Stocks (Cost $56,253,163) | 60,061,646 | |||||||
Repurchase Agreements (0.2%) | ||||||||
Nomura Securities, 5.20%, dated 06/29/07, due 07/02/07, repurchase price $128,822, collateralized by U.S. Government Agency Mortgages with a market value of $131,341 | $ | 128,766 | 128,766 | |||||
Securities Held As Collateral for Securities on Loan (8.9%) | ||||||||
Morgan Stanley Repurchase Agreement, 5.42%, dated 06/29/07, due 07/02/07, repurchase price $5,335,309, collateralized by U.S. Government Agency Mortgages with a market value of $5,439,558 | 5,332,900 | 5,332,900 | ||||||
Total Investments (Cost $61,714,829) (b) — 109.2% | 65,523,312 | |||||||
Liabilities in excess of other assets — (9.2)% | (5,493,942 | ) | ||||||
NET ASSETS — 100.0% | $ | 60,029,370 | ||||||
* | Denotes a non-income producing security. | |
(a) | All or a part of the security was on loan as of June 30, 2007. | |
(b) | See notes to financial statements for tax unrealized appreciation (depreciation) of securities. |
ADR | American Depository Receipt | |
CH | Switzerland | |
GB | United Kingdom | |
IL | Israel |
Nationwide | ||||||
NVIT Global | ||||||
Health Sciences Fund | ||||||
Assets: | ||||||
Investments, at value (cost $56,253,163)* | $ | 60,061,646 | ||||
Repurchase agreements, at cost and value | 5,461,666 | |||||
Total Investments | 65,523,312 | |||||
Foreign currencies, at value (cost $230) | 230 | |||||
Interest and dividends receivable | 40,252 | |||||
Receivable for capital shares issued | 4,693 | |||||
Receivable for investments sold | 556,809 | |||||
Prepaid expenses | 623 | |||||
Total Assets | 66,125,919 | |||||
Liabilities: | ||||||
Payable for investments purchased | 535,386 | |||||
Payable upon return of securities loaned | 5,332,900 | |||||
Payable for capital shares redeemed | 66,086 | |||||
Accrued expenses and other payables: | ||||||
Investment advisory fees | 136,768 | |||||
Fund administration and transfer agent fees | 2,876 | |||||
Distribution fees | 3,349 | |||||
Administrative servicing fees | 5,450 | |||||
Compliance program costs | 801 | |||||
Other | 12,933 | |||||
Total Liabilities | 6,096,549 | |||||
Net Assets | $ | 60,029,370 | ||||
Represented by: | ||||||
Capital | $ | 53,558,558 | ||||
Accumulated net investment income | 49,869 | |||||
Accumulated net realized gains from investment transactions and foreign currency transactions | 2,612,460 | |||||
Net unrealized appreciation on investments and translation of assets and liabilities denominated in foreign currencies | 3,808,483 | |||||
Net Assets | $ | 60,029,370 | ||||
Net Assets: | ||||||
Class I Shares | $ | 6,293,237 | ||||
Class II Shares | 2,209,932 | |||||
Class III Shares | 37,475,661 | |||||
Class VI Shares | 14,050,540 | |||||
Total | $ | 60,029,370 | ||||
Shares outstanding (unlimited number of shares authorized): | ||||||
Class I Shares | 564,199 | |||||
Class II Shares | 200,260 | |||||
Class III Shares | 3,352,533 | |||||
Class VI Shares | 1,264,335 | |||||
Total | 5,381,327 | |||||
Net asset value and offering price per share (Net assets by class divided by shares outstanding by class, respectively.): | ||||||
Class I Shares | $ | 11.15 | ||||
Class II Shares | $ | 11.04 | ||||
Class III Shares | $ | 11.18 | ||||
Class VI Shares | $ | 11.11 |
* | Includes value of securities on loan of $5,189,242. |
Nationwide NVIT | |||||
Global Health | |||||
Sciences Fund | |||||
INVESTMENT INCOME: | |||||
Interest income | $ | 7,875 | |||
Dividend income | 400,955 | ||||
Income from securities lending | 6,990 | ||||
Foreign tax withholding | (1,410 | ) | |||
Total Income | 414,410 | ||||
Expenses: | |||||
Investment advisory fees | 253,547 | ||||
Fund administration and transfer agent fees | 19,161 | ||||
Distribution fees Class II Shares | 2,794 | ||||
Distribution fees Class VI Shares | 16,288 | ||||
Administrative servicing fees Class I Shares | 4,470 | ||||
Administrative servicing fees Class II Shares | 1,598 | ||||
Administrative servicing fees Class III Shares | 26,706 | ||||
Administrative servicing fees Class VI Shares | 9,855 | ||||
Custodian fees | 11,753 | ||||
Trustee fees | 1,413 | ||||
Compliance program costs (Note 3) | 400 | ||||
Other | 16,435 | ||||
Total expenses before earnings credit | 364,420 | ||||
Earnings credit (Note 6) | (46 | ) | |||
Net Expenses | 364,374 | ||||
Net Investment Income | 50,036 | ||||
REALIZED/ UNREALIZED GAINS (LOSSES) FROM INVESTMENTS: | |||||
Net realized gains on investment transactions | 3,001,248 | ||||
Net realized losses on foreign currency transactions | (12,649 | ) | |||
Net realized gains on investment transactions and foreign currency transactions | 2,988,599 | ||||
Net change in unrealized appreciation on investments and translation of assets and liabilities denominated in foreign currencies | 975,333 | ||||
Net realized/unrealized gains (losses) on investments and translation of assets and liabilities denominated in foreign currencies | 3,963,932 | ||||
CHANGE IN NET ASSETS RESULTING FROM OPERATIONS | $ | 4,013,968 | |||
Nationwide NVIT | |||||||||
Global Health Sciences Fund | |||||||||
Six Months Ended | Year Ended | ||||||||
June 30, 2007 | December 31, 2006 | ||||||||
From Investment Activities: | |||||||||
Operations: | |||||||||
Net investment income | $ | 50,036 | $ | 90,702 | |||||
Net realized gains on investment transactions and foreign currency transactions | 2,988,599 | 1,897,224 | |||||||
Net change in unrealized appreciation/depreciation on investments and translation of assets and liabilities denominated in foreign currencies | 975,333 | (544,398 | ) | ||||||
Change in net assets resulting from operations | 4,013,968 | 1,443,528 | |||||||
Distributions to shareholders from: | |||||||||
Net realized gains: | |||||||||
Class I | (123,391 | ) | – | ||||||
Class II | (43,771 | ) | – | ||||||
Class III | (735,324 | ) | – | ||||||
Class VI | (276,421 | ) | – | ||||||
Change in net assets from shareholder distributions | (1,178,907 | ) | – | ||||||
Change in net assets from capital transactions | (1,831,947 | ) | (8,192,346 | ) | |||||
Change in net assets | 1,003,114 | (6,748,818 | ) | ||||||
Net Assets: | |||||||||
Beginning of period | 59,026,256 | 65,775,074 | |||||||
End of period | $ | 60,029,370 | $ | 59,026,256 | |||||
Accumulated net investment income (loss) at end of period | $ | 49,869 | $ | (167 | ) | ||||
CAPITAL TRANSACTIONS: | |||||||||
Class I Shares | |||||||||
Proceeds from shares issued | $ | 715,850 | $ | 5,163,982 | |||||
Dividends reinvested | 123,390 | – | |||||||
Cost of shares redeemed (a) | (1,513,258 | ) | (6,533,200 | ) | |||||
(674,018 | ) | (1,369,218 | ) | ||||||
Class II Shares | |||||||||
Proceeds from shares issued | 364 | 815 | |||||||
Dividends reinvested | 43,771 | – | |||||||
Cost of shares redeemed (a) | (241,435 | ) | (325,807 | ) | |||||
(197,300 | ) | (324,992 | ) | ||||||
Class III Shares | |||||||||
Proceeds from shares issued | 4,258,150 | 9,541,825 | |||||||
Dividends reinvested | 735,321 | – | |||||||
Cost of shares redeemed (a) | (7,251,184 | ) | (17,700,833 | ) | |||||
(2,257,713 | ) | (8,159,008 | ) | ||||||
Class VI Shares | |||||||||
Proceeds from shares issued | 2,035,871 | 4,874,986 | |||||||
Dividends reinvested | 276,420 | – | |||||||
Cost of shares redeemed (a) | (1,015,207 | ) | (3,214,114 | ) | |||||
1,297,084 | 1,660,872 | ||||||||
Change in net assets from capital transactions | $ | (1,831,947 | ) | $ | (8,192,346 | ) | |||
Nationwide NVIT | |||||||||
Global Health Sciences Fund | |||||||||
Six Months Ended | Year Ended | ||||||||
June 30, 2007 | December 31, 2006 | ||||||||
SHARE TRANSACTIONS: | |||||||||
Class I Shares | |||||||||
Issued | 64,599 | 497,062 | |||||||
Reinvested | 11,207 | – | |||||||
Redeemed | (135,691 | ) | (622,036 | ) | |||||
(59,885 | ) | (124,974 | ) | ||||||
Class II Shares | |||||||||
Reinvested | 4,019 | – | |||||||
Redeemed | (22,013 | ) | (31,669 | ) | |||||
(17,994 | ) | (31,669 | ) | ||||||
Class III Shares | |||||||||
Issued | 375,006 | 902,993 | |||||||
Reinvested | 66,666 | – | |||||||
Redeemed | (652,934 | ) | (1,698,205 | ) | |||||
(211,262 | ) | (795,212 | ) | ||||||
Class VI Shares | |||||||||
Issued | 181,927 | 465,167 | |||||||
Reinvested | 25,198 | – | |||||||
Redeemed | (92,816 | ) | (311,088 | ) | |||||
114,309 | 154,079 | ||||||||
Total change in shares | (174,832 | ) | (797,776 | ) | |||||
(a) | Includes redemption fees, if any. |
Investment Activities | Distributions | |||||||||||||||||||||||||||
Net Realized | ||||||||||||||||||||||||||||
and | Paid-in | |||||||||||||||||||||||||||
Net Asset | Net | Unrealized | Total | Capital | ||||||||||||||||||||||||
Value, | Investment | Gains | from | Net | from | |||||||||||||||||||||||
Beginning | Income | (Losses) on | Investment | Realized | Total | Redemption | ||||||||||||||||||||||
of Period | (Loss) | Investments | Activities | Gains | Distributions | Fees | ||||||||||||||||||||||
Class I Shares | ||||||||||||||||||||||||||||
Period ended December 31, 2002 (e) | $ | 9.51 | (0.02 | ) | (1.31 | ) | (1.33 | ) | – | – | 0.01 | |||||||||||||||||
For the year ended December 31, 2003 | $ | 8.19 | (0.02 | ) | 3.01 | 2.99 | (1.23 | ) | (1.23 | ) | 0.01 | |||||||||||||||||
For the year ended December 31, 2004 | $ | 9.96 | (0.03 | ) | 0.80 | 0.77 | (0.05 | ) | (0.05 | ) | 0.01 | |||||||||||||||||
For the year ended December 31, 2005 | $ | 10.69 | (0.03 | ) | 0.92 | 0.89 | (1.24 | ) | (1.24 | ) | – | |||||||||||||||||
For the year ended December 31, 2006 | $ | 10.34 | 0.03 | 0.25 | 0.28 | – | – | – | ||||||||||||||||||||
For the six months ended June 30, 2007 (Unaudited) | $ | 10.62 | 0.01 | 0.74 | 0.75 | (0.22 | ) | (0.22 | ) | – | ||||||||||||||||||
Class II Shares | ||||||||||||||||||||||||||||
Period ended December 31, 2003 (g) | $ | 8.72 | (0.01 | ) | 2.46 | 2.45 | (1.23 | ) | (1.23 | ) | 0.01 | |||||||||||||||||
For the year ended December 31, 2004 | $ | 9.95 | (0.06 | ) | 0.80 | 0.74 | (0.05 | ) | (0.05 | ) | 0.01 | |||||||||||||||||
For the year ended December 31, 2005 | $ | 10.65 | (0.05 | ) | 0.91 | 0.86 | (1.24 | ) | (1.24 | ) | – | |||||||||||||||||
For the year ended December 31, 2006 | $ | 10.27 | (0.01 | ) | 0.26 | 0.25 | – | – | – | |||||||||||||||||||
For the six months ended June 30, 2007 (Unaudited) | $ | 10.52 | – | 0.74 | 0.74 | (0.22 | ) | (0.22 | ) | – |
[Additional columns below]
[Continued from above table, first column(s) repeated]
Ratios/Supplemental Data | ||||||||||||||||||||||||||||||||||
Ratio of | ||||||||||||||||||||||||||||||||||
Ratio of | Investment | |||||||||||||||||||||||||||||||||
Ratio of Net | Expenses | Income (Loss) | ||||||||||||||||||||||||||||||||
Investment | (Prior to | (Prior to | ||||||||||||||||||||||||||||||||
Net Assets | Ratio of | Income | Reimbursements) | Reimbursements) | ||||||||||||||||||||||||||||||
Net Asset | at End of | Expenses to | (Loss) to | to Average | to Average | |||||||||||||||||||||||||||||
Value, End | Total | Period | Average Net | Average Net | Net Assets | Net Assets | Portfolio | |||||||||||||||||||||||||||
of Period | Return (a) | (000s) | Assets (b) | Assets (b) | (b)(c) | (b)(c) | Turnover (d) | |||||||||||||||||||||||||||
Class I Shares | ||||||||||||||||||||||||||||||||||
Period ended December 31, 2002 (e) | $ | 8.19 | (13.88% | ) | $ | 370 | 1.22% | (0.25%) | (f) | (f) | 764.93% | |||||||||||||||||||||||
For the year ended December 31, 2003 | $ | 9.96 | 36.69% | $ | 4,434 | 1.24% | (0.36%) | (f) | (f) | 542.89% | ||||||||||||||||||||||||
For the year ended December 31, 2004 | $ | 10.69 | 7.86% | $ | 7,910 | 1.26% | (0.28%) | (f) | (f) | 424.94% | ||||||||||||||||||||||||
For the year ended December 31, 2005 | $ | 10.34 | 8.44% | $ | 7,747 | 1.26% | (0.22%) | (f) | (f) | 366.90% | ||||||||||||||||||||||||
For the year ended December 31, 2006 | $ | 10.62 | 2.71% | $ | 6,626 | 1.19% | 0.24% | (f) | (f) | 243.33% | ||||||||||||||||||||||||
For the six months ended June 30, 2007 (Unaudited) | $ | 11.15 | 7.12% | $ | 6,293 | 1.14% | 0.25% | 1.14% | 0.25% | 63.77% | ||||||||||||||||||||||||
Class II Shares | ||||||||||||||||||||||||||||||||||
Period ended December 31, 2003 (g) | $ | 9.95 | 28.27% | $ | 2,232 | 1.49% | (0.59%) | (f) | (f) | 542.89% | ||||||||||||||||||||||||
For the year ended December 31, 2004 | $ | 10.65 | 7.56% | $ | 3,208 | 1.50% | (0.54%) | (f) | (f) | 424.94% | ||||||||||||||||||||||||
For the year ended December 31, 2005 | $ | 10.27 | 8.19% | $ | 2,567 | 1.51% | (0.47%) | (f) | (f) | 366.90% | ||||||||||||||||||||||||
For the year ended December 31, 2006 | $ | 10.52 | 2.43% | $ | 2,296 | 1.44% | (0.05%) | (f) | 243.33% | |||||||||||||||||||||||||
For the six months ended June 30, 2007 (Unaudited) | $ | 11.04 | 7.09% | $ | 2,210 | 1.41% | (0.02%) | 1.41% | (0.02% | ) | 63.77% |
(a) | Not annualized for periods less than one year. | |
(b) | Annualized for periods less than one year. | |
(c) | During the period, certain fees were waived and/or reimbursed. If such waivers/reimbursements had not occurred, the ratios would have been as indicated. | |
(d) | Portfolio turnover is calculated on the basis of the Fund as a whole without distinguishing among the classes of shares. | |
(e) | For the period from May 6, 2002 (recommencement of sales to the public) through December 31, 2002. | |
(f) | There were no fee reductions during the period. | |
(g) | For the period from March 28, 2003 (commencement of operations) through December 31, 2003. | |
(h) | For the period from April 28, 2004 (commencement of operations) through December 31, 2004. |
Investment Activities | Distributions | |||||||||||||||||||||||||||
Net Realized | ||||||||||||||||||||||||||||
and | Paid-in | |||||||||||||||||||||||||||
Net Asset | Net | Unrealized | Total | Capital | ||||||||||||||||||||||||
Value, | Investment | Gains | from | Net | from | |||||||||||||||||||||||
Beginning | Income | (Losses) on | Investment | Realized | Total | Redemption | ||||||||||||||||||||||
of Period | (Loss) | Investments | Activities | Gains | Distributions | Fees | ||||||||||||||||||||||
Class III Shares | ||||||||||||||||||||||||||||
For the year ended December 31, 2002 | $ | 10.14 | (0.03 | ) | (1.92 | ) | (1.95 | ) | – | – | 0.01 | |||||||||||||||||
For the year ended December 31, 2003 | $ | 8.20 | (0.03 | ) | 3.03 | 3.00 | (1.23 | ) | (1.23 | ) | 0.01 | |||||||||||||||||
For the year ended December 31, 2004 | $ | 9.98 | (0.03 | ) | 0.80 | 0.77 | (0.05 | ) | (0.05 | ) | 0.01 | |||||||||||||||||
For the year ended December 31, 2005 | $ | 10.71 | (0.02 | ) | 0.91 | 0.89 | (1.24 | ) | (1.24 | ) | – | |||||||||||||||||
For the year ended December 31, 2006 | $ | 10.36 | 0.02 | 0.26 | 0.28 | – | – | – | ||||||||||||||||||||
For the six months ended June 30, 2007 (Unaudited) | $ | 10.64 | 0.01 | 0.75 | 0.76 | (0.22 | ) | (0.22 | ) | – | ||||||||||||||||||
Class VI Shares | ||||||||||||||||||||||||||||
Period ended December 31, 2004 (h) | $ | 10.70 | (0.02 | ) | 0.02 | – | – | – | 0.01 | |||||||||||||||||||
For the year ended December 31, 2005 | $ | 10.71 | (0.03 | ) | 0.90 | 0.87 | (1.24 | ) | (1.24 | ) | – | |||||||||||||||||
For the year ended December 31, 2006 | $ | 10.34 | – | 0.25 | 0.25 | – | – | – | ||||||||||||||||||||
For the six months ended June 30, 2007 (Unaudited) | $ | 10.59 | – | 0.74 | 0.74 | (0.22 | ) | (0.22 | ) | – |
[Additional columns below]
[Continued from above table, first column(s) repeated]
Ratios/Supplemental Data | ||||||||||||||||||||||||||||||||||
Ratio of | ||||||||||||||||||||||||||||||||||
Ratio of Net | Ratio of | Investment | ||||||||||||||||||||||||||||||||
Investment | Expenses | Income (Loss) | ||||||||||||||||||||||||||||||||
Net Assets | Ratio of | Income | (Prior to | (Prior to | ||||||||||||||||||||||||||||||
Net Asset | at End of | Expenses to | (Loss) to | Reimbursements) | Reimbursements) | |||||||||||||||||||||||||||||
Value, End | Total | Period | Average Net | Average Net | to Average | to Average | Portfolio | |||||||||||||||||||||||||||
of Period | Return (a) | (000s) | Assets (b) | Assets (b) | Net Assets (b)(c) | Net Assets (b)(c) | Turnover (d) | |||||||||||||||||||||||||||
Class III Shares | ||||||||||||||||||||||||||||||||||
For the year ended December 31, 2002 | $ | 8.20 | (19.13% | ) | $ | 11,652 | 1.23% | (0.37%) | 1.24% | (0.38% | ) | 764.93% | ||||||||||||||||||||||
For the year ended December 31, 2003 | $ | 9.98 | 36.77% | $ | 27,026 | 1.22% | (0.39%) | (f) | (f) | 542.89% | ||||||||||||||||||||||||
For the year ended December 31, 2004 | $ | 10.71 | 7.84% | $ | 39,723 | 1.26% | (0.29%) | (f) | (f) | 424.94% | ||||||||||||||||||||||||
For the year ended December 31, 2005 | $ | 10.36 | 8.42% | $ | 45,169 | 1.25% | (0.24%) | (f) | (f) | 366.90% | ||||||||||||||||||||||||
For the year ended December 31, 2006 | $ | 10.64 | 2.70% | $ | 37,921 | 1.19% | 0.19% | (f) | (f) | 243.33% | ||||||||||||||||||||||||
For the six months ended June 30, 2007 (Unaudited) | $ | 11.18 | 7.20% | $ | 37,476 | 1.16% | 0.23% | 1.16% | 0.23% | 63.77% | ||||||||||||||||||||||||
Class VI Shares | ||||||||||||||||||||||||||||||||||
Period ended December 31, 2004 (h) | $ | 10.71 | 0.09% | $ | 4,981 | 1.35% | (0.36%) | (f) | (f) | 424.94% | ||||||||||||||||||||||||
For the year ended December 31, 2005 | $ | 10.34 | 8.23% | $ | 10,292 | 1.42% | (0.43%) | (f) | (f) | 366.90% | ||||||||||||||||||||||||
For the year ended December 31, 2006 | $ | 10.59 | 2.42% | $ | 12,183 | 1.43% | (0.04%) | (f) | (f) | 243.33% | ||||||||||||||||||||||||
For the six months ended June 30, 2007 (Unaudited) | $ | 11.11 | 7.04% | $ | 14,051 | 1.41% | (0.03%) | 1.41% | (0.03% | ) | 63.77% |
(a) | Not annualized for periods less than one year. | |
(b) | Annualized for periods less than one year. | |
(c) | During the period, certain fees were waived and/or reimbursed. If such waivers/reimbursements had not occurred, the ratios would have been as indicated. | |
(d) | Portfolio turnover is calculated on the basis of the Fund as a whole without distinguishing among the classes of shares. | |
(e) | For the period from May 6, 2002 (recommencement of sales to the public) through December 31, 2002. | |
(f) | There were no fee reductions during the period. | |
(g) | For the period from March 28, 2003 (commencement of operations) through December 31, 2003. | |
(h) | For the period from April 28, 2004 (commencement of operations) through December 31, 2004. |
(a) | Security Valuation |
Securities for which market quotations are readily available are valued at current market value as of “Valuation Time.” Valuation Time is as of the close of regular trading on the New York Stock Exchange (usually 4 p.m. Eastern time). Equity securities are valued at the last quoted sale price or, if there is no sale price, the last quoted bid price provided by an independent pricing service approved by the Trust’s Board of Trustees (“Board of Trustees”). Securities traded on NASDAQ are valued at the NASDAQ official closing price. Prices are taken from the primary market or exchange in which each security trades. | |
Most securities listed on a foreign exchange are valued either at fair value (see description below) or at the last sale price at the close of the exchange on which the security is principally traded. Foreign securities, currencies, and other assets and liabilities denominated in foreign currencies are translated into U.S. dollars at the exchange rate of said currencies against the U.S. dollar, as of Valuation Time, as provided by an independent pricing service approved by the Board of Trustees. | |
Securities for which market quotations are not readily available, or for which an independent pricing service does not provide a value or provides a value that does not represent fair value in the judgment of the Fund’s investment adviser or designee, are valued at fair value under procedures approved by the Board of Trustees. The “Fair Value” of these securities is determined in good faith by taking into account relevant factors and surrounding circumstances. Methods utilized to obtain a “Fair Value” may include the following non-exclusive list of acceptable methods: (i) a multiple of earnings; (ii) the discount from market value of a similar, freely traded security; (iii) the yield-to-maturity for debt issues; or (iv) a consolidation of the methods. The Trust’s Valuation & Operations Committee considers a non-exclusive list of factors to arrive at the appropriate method of determining “Fair Value.” For example, fair value determinations are required for securities whose value is affected by a “significant” event that materially affects the value of a domestic or foreign security which occurs subsequent to the time of the close of the principal market on which such domestic or foreign security trades and before the Valuation Time (i.e., a “subsequent event”). Typically, |
this will involve events occurring after the close of a foreign market on which a security trades and before the next Valuation Time. | |
The Fund values foreign securities at fair value in the circumstances described below. Generally, trading in foreign securities markets is completed each day at various times prior to the Valuation Time. Due to the time differences between the closings of the relevant foreign securities exchanges and the Valuation Time for the Fund, the Fund will fair value its foreign investments when it is determined that the market quotations for the foreign investments either are not readily available or are unreliable and, therefore, do not represent fair value. When the fair value prices are utilized, these prices will attempt to reflect the impact of the U.S. financial markets’ perceptions and trading activities on the Fund’s foreign investments since the last closing prices of the foreign investments were calculated on their primary foreign securities markets or exchanges. For these purposes, the Board of Trustees has determined that movements in relevant indices or other appropriate market indicators, after the close of the foreign securities exchanges, may demonstrate that market quotations are unreliable, and may trigger fair value pricing for certain securities. Consequently, fair valuation of portfolio securities may occur on a daily basis. |
(b) | Repurchase Agreements |
The Fund may enter into repurchase agreements with an entity which is a member of the Federal Reserve System or which is a “primary dealer” (as designated by the Federal Reserve Bank of New York) in U.S. Government obligations. The repurchase price generally equals the price paid by the Fund plus interest negotiated on the basis of current short-term rates, which may be more or less than the rate on the underlying portfolio securities. The seller under a repurchase agreement is required to maintain the value of the collateral held pursuant to the agreement at a market value equal to or greater than the repurchase price (including accrued interest). Collateral subject to repurchase agreements is held by the Fund’s custodian or another qualified sub-custodian or in the Federal Reserve/ Treasury book-entry system. If the counterparty defaults and the fair value of the collateral declines, realization of the collateral by the Fund may be delayed or limited. The Fund may transfer uninvested cash balances into a pooled cash account. These balances are invested in one or more repurchase agreements, with the counterparty of Nomura Securities, which is fully collateralized by U.S. Government Agency Mortgages. |
(c) | Foreign Currency Transactions |
The accounting records of the Fund are maintained in U.S. dollars. Foreign currency amounts are translated into U.S. dollars at the current rate of exchange to determine the value of investments, assets and liabilities. The Fund may enter into foreign currency contracts in connection with purchases or sales of securities denominated in a foreign currency. Purchases and sales of securities, and income and expenses, are translated at the prevailing rate of exchange on the respective date of these transactions. The Fund does not isolate that portion of the results of operations resulting from changes in foreign exchange rates on investments from fluctuations arising from changes in market prices of securities held. These fluctuations are included with the net realized and unrealized gain or loss from investments and foreign currencies. |
(d) | Forward Foreign Currency Contracts |
The Fund may enter into forward foreign currency contracts in connection with planned purchases or sales of securities or to hedge the U.S. dollar value of portfolio securities denominated in a particular currency. The Fund could be exposed to risks if the counterparties to the contracts are unable to meet the terms of their contracts and from unanticipated movements in the value of a foreign currency relative to the U.S. dollar. Forward foreign currency contracts are valued at the current cost of covering these contracts, as provided by an independent pricing service approved by the Board of Trustees. The forward foreign currency contracts are adjusted by the daily exchange rate of the underlying currency and any gains or losses are recorded for financial statement purposes as unrealized gains or losses until the contract settlement date. |
(e) | Futures Contracts |
The Fund may invest in financial futures contracts (“futures contracts”) for the purpose of hedging its existing portfolio securities or securities that the Fund intends to purchase against fluctuations in value caused by changes in prevailing market interest rates or prices. Futures contracts may also be entered into for non-hedging purposes. | |
Upon entering into a futures contract, the Fund is required to pledge to the broker an amount of cash and/or other assets equal to a certain percentage of the contract amount (initial margin deposit). Subsequent payments, known as “variation margin,” are made each day, depending on the daily fluctuations in the fair value/ market value of the underlying assets. A gain or loss equal to the daily variation margin is recognized on a daily basis. Futures contracts are valued daily at their last quoted sale price. | |
A “sale” of a futures contract means the creation of a contractual obligation to deliver the securities or foreign currency called for by the contract at a fixed price at a specified time in the future. A “purchase” of a futures contract means the creation of a contractual obligation to acquire the securities or foreign currency at a fixed price at a specified time in the future. | |
Should market conditions change unexpectedly, the Fund may not achieve the anticipated benefits of the futures contracts and may realize a loss. The use of futures transactions for hedging purposes involves the risk of imperfect correlation in movements in the price of futures contracts, interest rates, and the value of the underlying hedged assets. |
(f) | Short Sales |
The Fund is authorized to engage in short-selling of portfolio securities which obligates the Fund to replace any security that the Fund has borrowed by purchasing the security at current market value sometime in the future. The Fund will incur a loss if the price of the security increases between the date of the short sale and the date on which the Fund replaces the borrowed security. The Fund generally will realize a gain if the price of the security declines between these dates. Until the Fund replaces the borrowed security, the Fund will maintain a segregated account with cash, U.S. Government securities and/or securities held long to sufficiently cover the Fund’s short position on a daily basis. Dividends declared on securities sold short are recorded as an expense on the ex-dividend date and paid to the counterparty on the dividend pay date. |
(g) | Security Transactions and Investment Income |
Security transactions are accounted for on the date the security is purchased or sold (“trade date”). Securities gains and losses are calculated on the identified cost basis. Interest income is recognized on the accrual basis and includes, where applicable, the amortization or accretion of premium or discount. Dividend income is recorded on the ex-dividend date. |
(h) | Securities Lending |
To generate additional income, the Fund may lend its portfolio securities, up to 331/3% of the Fund, to brokers, dealers and other financial institutions provided that (1) the borrower delivers cash or securities as collateral with respect to each new loan of U.S. securities, equal to at least 102% of the value of the portfolio securities loaned, and with respect to each new loan on non-U.S. securities, collateral of at least 105% of the value of the portfolio securities loaned; and (2) at all times thereafter shall require the borrower to mark-to-market the collateral on a daily basis so that the market value of such collateral does not fall below 100% of the value of securities loaned. The Fund receives payments from borrowers equivalent to the dividends and interest that would have been earned on securities loaned while simultaneously seeking to earn income on the investment of cash collateral. There may be risks of delay in recovery of the securities should the borrower of the securities fail financially. Loans will be made, however, only to borrowers deemed by the Fund’s investment adviser to be of good standing and creditworthy under guidelines established by the Board of Trustees and when, in judgment of the adviser, the consideration which can be earned currently from these securities loans justifies the attendant risks. Loans are subject to termination by the Fund or the |
borrower at any time, and, therefore, are not considered to be illiquid investments. JPMorgan Chase Bank serves as custodian for the securities lending program of the Fund. JPMorgan Chase Bank receives a fee based on the value of the collateral received from borrowers. | |
Information on the investment of cash collateral is shown in the Statement of Investments. | |
As of June 30, 2007, the Fund had securities with the following value on loan: |
Value of | ||||||
Value of Loaned Securities | Collateral | |||||
$5,189,242 | $ | 5,332,900 | ||||
(i) | Distributions to Shareholders |
The Fund’s dividends from net investment income, if any, are declared and paid quarterly. The Fund’s distributions from net realized capital gains, if any, are declared and distributed at least annually. | |
Dividends and distributions to shareholders are determined in accordance with federal income tax regulations, which may differ from GAAP. These “book/tax” differences are considered either permanent or temporary in nature. In accordance with the American Institute of Certified Public Accountants Statement of Position 93-2, permanent differences (i.e., reclassification of market discounts, foreign exchange gain/loss, paydowns, and distributions from real estate investment trusts) are reclassified within the capital accounts based on their nature for federal income tax purposes; temporary differences do not require reclassification. These reclassifications have no effect upon the net asset value of the Fund. To the extent distributions exceed current and accumulated earnings and profits for federal income tax purposes, these distributions are reported as distributions of paid-in-capital. |
(j) | Federal Income Taxes |
It is the policy of the Fund to qualify or to continue to qualify as a “regulated investment company” by complying with the provisions available to certain investment companies, as defined in Subchapter M of the U.S. Internal Revenue Code, and to make distributions of net investment income and net realized capital gains sufficient to relieve the Fund from all, or substantially all, federal income taxes. | |
As of June 30, 2007, the tax cost of securities and the breakdown of unrealized appreciation (depreciation) for the Fund was as follows: |
Net | ||||||||||||||||
Unrealized | ||||||||||||||||
Tax Cost of | Unrealized | Unrealized | Appreciation | |||||||||||||
Securities | Appreciation | Depreciation | (Depreciation) | |||||||||||||
$ | 62,074,200 | $ | 4,557,965 | $ | (1,108,853 | ) | $ | 3,449,112 | ||||||||
(k) | Allocation of Expenses, Income, and Gains and Losses |
Expenses directly attributable to the Fund are charged to the Fund. Expenses not directly attributable to the Fund are allocated proportionately among various or all funds within the Trust. The method used by the Fund for allocating income, fund level expenses, and realized and unrealized gains or losses is based on the fair value of shares outstanding relative to net assets. Under this method, each class of shares participates based on the total net asset value of that class’s shares in proportion to the total net assets of the Fund. Expenses specific to a class (such as Rule 12b-1 and administrative services fees) are charged to that class. |
Base Management Fee | Fees | |||||
$0 up to $500 million | 0.90% | |||||
$500 million up to $2 billion | 0.85% | |||||
$2 billion and more | 0.80% | |||||
Out or Underperformance | Change in Fees | |||||
+/- 1 percentage point | +/- 0.02% | |||||
+/- 2 percentage point | +/- 0.04% | |||||
+/- 3 percentage point | +/- 0.06% | |||||
+/- 4 percentage point | +/- 0.08% | |||||
+/- 5 percentage point | +/- 0.10% | |||||
Combined Fee Schedule* | ||||||
Up to $1 billion | 0.15% | |||||
$1 billion up to $3 billion | 0.10% | |||||
$3 billion up to $8 billion | 0.05% | |||||
$8 billion up to $10 billion | 0.04% | |||||
$10 billion up to $12 billion | 0.02% | |||||
$12 billion or more | 0.01% | |||||
* | The assets of the Nationwide NVIT Investor Destinations Aggressive Fund, the Nationwide NVIT Investor Destinations Moderately Aggressive Fund, the Nationwide NVIT Investor Destinations Moderate Fund, the Nationwide NVIT Investor Destinations Moderately Conservative Fund, and the Nationwide NVIT Investor Destinations Conservative Fund (collectively, the “Investor Destinations Funds”) are excluded from the Trust asset level amount in order to calculate this asset-based fee. The Investor Destinations Funds do not pay any part of this fee. |
Number of Portfolios | ||||||||||
Position(s) Held | in the | |||||||||
with the Trust | Principal Occupation(s) | Nationwide Fund | Other | |||||||
Name, Address | and Length of | During Past | Complex Overseen | Directorships | ||||||
and Year of Birth | Time Served1 | Five Years | by Trustee | Held by Trustee2 | ||||||
Charles E. Allen c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1948 | Trustee since July 2000 | Mr. Allen is Chairman, Chief Executive Officer and President of Graimark Realty Advisors, Inc. (real estate development, investment and asset management). | 89 | None | ||||||
Paula H.J. Cholmondeley c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1947 | Trustee since July 2000 | Ms. Cholmondeley was Vice President and General Manager of Sappi Fine Paper North America from April 2000 through December 2003. | 89 | Director of Dentsply International, Inc. (dental products), Ultralife Batteries, Inc., Terex Corporation (construction equipment), Minerals Technology, Inc. (specialty chemicals) and Albany International Corp. (paper industry) | ||||||
C. Brent DeVore3 c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1940 | Trustee since 1990 | Dr. DeVore is President of Otterbein College. | 89 | None | ||||||
Phyllis Kay Dryden c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1947 | Trustee since December 2004 | Ms. Dryden was a partner of Mitchell Madison, a management consulting company from January 2006 until December 2006; she is currently a consultant with the company. Ms. Dryden was formerly Managing Partner of march FIRST, a global management consulting firm. | 89 | None | ||||||
Barbara L. Hennigar c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1935 | Trustee since July 2000 | Retired. | 89 | None | ||||||
Number of Portfolios | ||||||||||
Position(s) Held | in the | |||||||||
with the Trust | Principal Occupation(s) | Nationwide Fund | Other | |||||||
Name, Address | and Length of | During Past | Complex Overseen | Directorships | ||||||
and Year of Birth | Time Served1 | Five Years | by Trustee | Held by Trustee2 | ||||||
Barbara I. Jacobs c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1950 | Trustee since December 2004 | Ms. Jacobs served as Chairman of the Board of Directors of KICAP Network Fund, a European (United Kingdom) hedge fund, from January 2001 through January 2006. From 1998-2003, Ms. Jacobs was also a Managing Director and European Portfolio Manager of CREF Investments (Teachers Insurance and Annuity Association-College Retirement Equities Fund). | 89 | None | ||||||
Douglas F. Kridler c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1955 | Trustee since September 1997 | Mr. Kridler has served as the President and Chief Executive Officer of the Columbus Foundation (a Columbus, OH-based foundation which manages over 1,300 individual endowment funds) since February 2002. Prior to January 31, 2002, Mr. Kridler was the President of the Columbus Association for the Performing Arts and Chairman of the Greater Columbus Convention and Visitors Bureau. | 89 | None | ||||||
Michael D. McCarthy c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1947 | Trustee since December 2004 | Retired. Mr. McCarthy was Chairman of VMAC (commodity swaps) from October 2002 until January 2007; and a partner of Pineville Properties LLC (a commercial real estate development firm) from September 2000 until January 2007. | 89 | None | ||||||
David C. Wetmore c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1948 | Trustee since 1995 and Chairman since February 2005 | Retired. | 89 | None | ||||||
1 | Length of time served includes time served with the Trust’s predecessors. | |
2 | Directorships held in (1) any other investment companies registered under the 1940 Act, (2) any company with a class of securities registered pursuant to Section 12 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or (3) any company subject to the requirements of Section 15(d) of the Exchange Act. | |
3 | Mr. DeVore has served as President of Otterbein College since 1984. Mark Thresher, President and Chief Operating Officer of Nationwide Financial Services, Inc. (“NFS”) has served as a member of the Board of Trustees of Otterbein College since 2000, currently serves as one of 30 of its trustees, and is currently one of two Vice Chairmen of the Board. Each of Nationwide Fund Advisors (“NFA”), the Funds’ investment adviser, and Nationwide Fund Distributors LLC (“NFD”), principal underwriter to the Trust, is a wholly-owned subsidiary of NFS. | |
Additional information regarding the Trustees and Officers may be found in the Trust’s Statement of Additional Information, which is available without charge upon request, by calling 800-848-0920. |
Number of Portfolios | ||||||||||
Position(s) Held | in the | |||||||||
with the Trust | Principal Occupation(s) | Nationwide Fund | Other | |||||||
Name, Address | and Length of | During Past | Complex Overseen | Directorships | ||||||
and Year of Birth | Time Served1 | 5 Years | by Trustee | Held by Trustee 2 | ||||||
Arden L. Shisler c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1941 | Trustee since February 2000 | Retired. Mr. Shisler is the former President and Chief Executive Officer of KeB Transport, Inc., a trucking firm (2000 through 2002). He served as a consultant to KeB from January 2003 through December 2004. Since 1992, Mr. Shisler has also been Chairman of the Board for Nationwide Mutual Insurance Company.3 | 89 | Director of Nationwide Financial Services, Inc., Chairman of Nationwide Mutual Insurance Company3 | ||||||
John H. Grady Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1961 | President & Chief Executive Officer since December 2006 | Mr. Grady is President, and Chief Executive Officer of Nationwide Funds Group which includes Nationwide Fund Advisors,3 Nationwide Fund Management LLC,3 Nationwide Fund Distributors LLC 3 and NWD Investments,2 the asset management operations of Nationwide Mutual Insurance Company, which includes Morley Capital Management, Inc.,2 Nationwide Separate Accounts LLC,2 NorthPointe Capital LLC,2 and Nationwide SA Capital Trust2. From March 2004 until March 2006, Mr. Grady was Chief Executive Officer of Constellation Investment Management Co., L.P. (registered investment adviser), and President and Chief Executive Officer of Constellation Funds Group (registered investment companies). He also was President of Constellation Investment Distribution Co., Inc. (registered broker-dealer) from March 2004 until June 2006. From February 2001 until February 2004, Mr. Grady was Chief Operating and Chief Legal Officer; Managing Director, Mutual Funds Group, Turner Investment Partners, Inc. (registered investment adviser); Executive Vice President of Turner Funds and Turner Institutional Portfolios (registered investment companies); and President, Turner Investment Distributors, Inc. (registered broker-dealer). | N/A | None | ||||||
Gerald J. Holland Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1951 | Treasurer since March 2001 | Mr. Holland is Senior Vice President—Operations for Nationwide Funds Group3. | N/A | N/A | ||||||
Number of Portfolios | ||||||||||
Position(s) Held | in the | |||||||||
with the Trust | Principal Occupation(s) | Nationwide Fund | Other | |||||||
Name, Address | and Length of | During Past | Complex Overseen | Directorships | ||||||
and Year of Birth | Time Served1 | 5 Years | by Trustee | Held by Trustee 2 | ||||||
Michael A. Krulikowski Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1959 | Chief Compliance Officer from June 2004 to August 20074 | Mr. Krulikowski is Vice President and Chief Compliance Officer of Nationwide Funds Group3, Morley Capital Management, Inc.3, Nationwide SA Capital Trust (since 1999)3, and Nationwide Separate Accounts LLC (since August 2005).3 Since June 2004, Mr. Krulikowski has also served as Chief Compliance Officer of the Trust. From November 1999 through May 2007, he served as Vice President and Chief Compliance Officer of NorthPointe Capital LLC. 3 | N/A | N/A | ||||||
Eric E. Miller Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1953 | Secretary since December 2002 | Mr. Miller is Senior Vice President, General Counsel, and Assistant Secretary for Nationwide Funds Group3 and NWD Investments.2 From August 2000 to August 2002, Mr. Miller was a Partner with Stradley Ronon Stevens & Young, LLP. | N/A | N/A | ||||||
1 | Length of time served includes time served with the Trust’s predecessors. | |
2 | Directorships held in (1) any other investment companies registered under the 1940 Act, (2) any company with a class of securities registered pursuant to Section 12 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or (3) any company subject to the requirements of Section 15(d) of the Exchange Act. | |
3 | This position is held with an affiliated person or principal underwriter of the Trust. | |
4 | Effective August 3, 2007, the Board of Trustees approved Carol Baldwin Moody as Chief Compliance Officer of the Trust. Since November 2005, Ms. Moody has been Senior Vice President, Chief Compliance Officer of Nationwide Financial Services, Nationwide Life Insurance Company, Nationwide Life and Annuity Insurance Company, and Nationwide Investment Advisors, LLC. From February 2004-November 2005, she was Chief Compliance Officer of TIAA-CREF and from April 2000-February 2004, she was Managing Director and General Counsel, TCW/ Latin America Partners, LLC and Baeza & Co., LLC. | |
Federal law requires the Trust, each of its investment advisers and sub-advisers to adopt procedures for voting proxies (“Proxy Voting Guidelines”) and to provide a summary of those Proxy Voting Guidelines used to vote the securities held by the Funds. The Funds’ proxy voting policies and procedures are available without charge (i) upon request, by calling 800-848-0920, (ii) on the Funds’ website at www.nationwidefunds.com, or (iii) on the Securities and Exchange Commission’s website at www.sec.gov. |
(i) | General Information Regarding the Board’s Review of Investment Advisory Agreements |
(ii) | Board Conclusions Regarding the Fund’s Advisory Agreement |
Number of Shares | ||||||
Fund | Cast/Not Cast | Percentages | ||||
Federated NVIT High Income Bond Fund (Formerly Federated GVIT High Income Bond Fund) | FOR AGAINST ABSTAIN TOTAL | 30,051,703.188 shares 618,245.021 shares 1,813,550.431 shares 32,483,498.640 shares | 92.514% 1.903% 5.583% | |||
NVIT International Index Fund (Formerly GVIT International Index Fund) | FOR AGAINST ABSTAIN TOTAL | 4,322,203.982 shares 2,758.318 shares 135,636.840 shares 4,460,599.140 shares | 96.897% 0.062% 3.041% | |||
NVIT International Value Fund (Formerly GVIT International Value Fund) | FOR AGAINST ABSTAIN TOTAL | 20,032,843.199 shares 333,588.902 shares 1,093,293.879 shares 21,459,725.980 shares | 93.351% 1.554% 5.095% | |||
NVIT Mid Cap Index Fund (Formerly GVIT Mid Cap Index Fund) | FOR AGAINST ABSTAIN TOTAL | 35,380,179.120 shares 631,117.844 shares 1,565,714.306 shares 37,577,011.270 shares | 94.154% 1.679% 4.167% |
Number of Shares | ||||||
Fund | Cast/Not Cast | Percentages | ||||
NVIT S&P 500 Index Fund (Formerly GVIT S&P 500 Index Fund) | FOR AGAINST ABSTAIN TOTAL | 56,119,814.230 shares 666,195.542 shares 1,944,898.888 shares 58,730,908.660 shares | 95.554% 1.134% 3.312% | |||
Nationwide Multi-Manager NVIT Small Cap Growth Fund (Formerly GVIT Small Cap Growth Fund) | FOR AGAINST ABSTAIN TOTAL | 7,632,918.513 shares 149,458.111 shares 451,583.036 shares 8,233,959.660 shares | 92.700% 1.816% 5.484% | |||
Nationwide Multi-Manager NVIT Small Cap Value Fund (Formerly GVIT Small Cap Value Fund) | FOR AGAINST ABSTAIN TOTAL | 48,649,396.525 shares 979,183.753 shares 2,786,133.102 shares 52,414,713.380 shares | 92.816% 1.868% 5.316% | |||
Nationwide Multi-Manager NVIT Small Company Fund (Formerly GVIT Small Company Fund) | FOR AGAINST ABSTAIN TOTAL | 29,903,181.700 shares 838,774.923 shares 2,006,741.307 shares 32,748,697.930 shares | 91.311% 2.561% 6.128% | |||
Gartmore NVIT Developing Markets Fund (Formerly Gartmore GVIT Developing Markets Fund) | FOR AGAINST ABSTAIN TOTAL | 21,0177,889.443 shares 424,272.958 shares 1,543,850.729 shares 23,046,013.130 shares | 91.460% 1.841% 6.699% | |||
Gartmore NVIT Emerging Markets Fund (Formerly Gartmore GVIT Emerging Markets Fund) | FOR AGAINST ABSTAIN TOTAL | 17,050,534.593 shares 526,574.722 shares 881,608.905 shares 18,458,718.220 shares | 92.371% 2.853% 4.776% | |||
Nationwide NVIT Global Financial Services Fund (Formerly Gartmore GVIT Global Financial Services Fund) | FOR AGAINST ABSTAIN TOTAL | 1,554,847.333 shares 19,539.033 shares 52,206.494 shares 1,626,592.860 shares | 95.589% 1.201% 3.210% | |||
Nationwide NVIT Global Health Sciences Fund (Formerly Gartmore GVIT Global Health Sciences Fund) | FOR AGAINST ABSTAIN TOTAL | 4,722,963.678 shares 157,979.030 shares 207,642.222 shares 5,088,584.930 shares | 92.815% 3.104% 4.081% | |||
Nationwide NVIT Global Technology and Communications Fund (Formerly Gartmore GVIT Global Technology and Communications Fund) | FOR AGAINST ABSTAIN TOTAL | 8,585,472.039 shares 102,267.977 shares 489,577.634 shares 9,177,317.650 shares | 93.551% 1.114% 5.335% | |||
Gartmore NVIT Global Utilities Fund (Formerly Gartmore GVIT Global Utilities Fund) | FOR AGAINST ABSTAIN TOTAL | 4,123,270.549 shares 122,001.533 shares 240,276.088 shares 4,485,548.170 shares | 91.923% 2.720% 5.357% | |||
Nationwide NVIT Government Bond Fund (Formerly Gartmore GVIT Government Bond Fund) | FOR AGAINST ABSTAIN TOTAL | 88,471,567.462 shares 1,825,645.181 shares 5,841,990.727 shares 96,139,203.370 shares | 92.024% 1.899% 6.077% |
Number of Shares | ||||||
Fund | Cast/Not Cast | Percentages | ||||
Nationwide NVIT Growth Fund (Formerly Gartmore GVIT Growth Fund) | FOR AGAINST ABSTAIN TOTAL | 14,931,435.904 shares 409,826.402 shares 1,259,945.064 shares 16,601,207.370 shares | 89.942% 2.469% 7.589% | |||
Gartmore NVIT International Growth Fund (Formerly Gartmore GVIT International Growth Fund) | FOR AGAINST ABSTAIN TOTAL | 6,251,419.070 shares 139,618.548 shares 290,025.592 shares 6,681,063.210 shares | 93.569% 2.090% 4.341% | |||
Nationwide NVIT Investor Destinations Aggressive Fund (Formerly Gartmore GVIT Investor Destinations Aggressive Fund) | FOR AGAINST ABSTAIN TOTAL | 49,489,224.549 shares 1,385,396.474 shares 3,696,272.337 shares 54,570,893.360 shares | 90.688% 2.539% 6.773% | |||
Nationwide NVIT Investor Destinations Conservative Fund (Formerly Gartmore GVIT Investor Destinations Conservative Fund) | FOR AGAINST ABSTAIN TOTAL | 23,091,965.887 shares 314,935,884 shares 2,292,355.179 shares 25,699,256.950 shares | 89.855% 1.225% 8.920% | |||
Nationwide NVIT Investor Destinations Moderate Fund (Formerly Gartmore GVIT Investor Destinations Moderate Fund) | FOR AGAINST ABSTAIN TOTAL | 188,902,093.059 shares 3,018,924.590 shares 16,359,690.401 shares 208,280,708.050 shares | 90.696% 1.449% 7.855% | |||
Nationwide NVIT Investor Destinations Moderately Aggressive Fund (Formerly Gartmore GVIT Investor Destinations Moderately Aggressive Fund) | FOR AGAINST ABSTAIN TOTAL | 134,792,622.920 shares 3,489,207.264 shares 9,304,197.656 shares 147,586,027.840 shares | 91.332% 2.364% 6.304% | |||
Nationwide NVIT Investor Destinations Moderately Conservative Fund (Formerly Gartmore GVIT Investor Destinations Moderately Conservative Fund) | FOR AGAINST ABSTAIN TOTAL | 49,627,123.216 shares 856,088.634 shares 3,507,215.650 shares 53,990,427.500 shares | 91.918% 1.586% 6.496% | |||
Nationwide NVIT Mid Cap Growth Fund (Formerly Gartmore GVIT Mid Cap Growth Fund) | FOR AGAINST ABSTAIN TOTAL | 10,879,584.971 shares 352,594.958 shares 717,792.971 shares 11,949,972.900 shares | 91.043% 2.950% 6.007% | |||
Nationwide NVIT Money Market Fund II (Formerly Gartmore GVIT Money Market Fund II) | FOR AGAINST ABSTAIN TOTAL | 221,774,863.241 shares 12,322,482.494 shares 16,471,740.875 shares 250,569,086.610 shares | 88.508% 4.918% 6.574% | |||
Nationwide NVIT Money Market Fund (Formerly Gartmore GVIT Money Market Fund) | FOR AGAINST ABSTAIN TOTAL | 1,578,331,008.328 shares 32,372,133.671 shares 112,652,123.301 shares 1,723,355,265.300 shares | 91.585% 1.878% 6.537% | |||
NVIT Nationwide Fund (Formerly Gartmore GVIT Nationwide Fund) | FOR AGAINST ABSTAIN TOTAL | 125,423,274.735 shares 2,767,979.467 shares 8,762,255.828 shares 136,953,510.030 shares | 91.581% 2.021% 6.398% |
Number of Shares | ||||||
Fund | Cast/Not Cast | Percentages | ||||
NVIT Nationwide Leaders Fund (Formerly Gartmore GVIT Nationwide Leaders Fund) | FOR AGAINST ABSTAIN TOTAL | 2,298,504.956 shares 29,630.469 shares 71,637.755 shares 2,399,773.180 shares | 95.780% 1.235% 2.985% | |||
Nationwide NVIT U.S. Growth Leaders Fund (Formerly Gartmore GVIT U.S. Growth Leaders Fund) | FOR AGAINST ABSTAIN TOTAL | 4,972,094.773 shares 122,623.161 shares 174,625.606 shares 5,269,343.540 shares | 94.359% 2.327% 3.314% | |||
Gartmore NVIT Worldwide Leaders Fund (Formerly Gartmore GVIT Worldwide Leaders Fund) | FOR AGAINST ABSTAIN TOTAL | 2,666,862.487 shares 47,702.491 shares 118,719.882 shares 2,833,284.860 shares | 94.126% 1.684% 4.190% | |||
JP Morgan NVIT Balanced Fund (Formerly JP Morgan GVIT Balanced Fund) | FOR AGAINST ABSTAIN TOTAL | 15,966,867.546 shares 259,004.324 shares 1,339,385.200 shares 17,565,257.070 shares | 90.900% 1.475% 7.625% | |||
Van Kampen NVIT Comstock Value Fund (Formerly Van Kampen GVIT Comstock Value Fund) | FOR AGAINST ABSTAIN TOTAL | 27,737,008.009 shares 502,564.164 shares 1,824,670.107 shares 30,064,242.280 shares | 92.259% 1.672% 6.069% | |||
Van Kampen NVIT Multi Sector Bond Fund (Formerly Van Kampen GVIT Multi Sector Bond Fund) | FOR AGAINST ABSTAIN TOTAL | 21,253,297.665 shares 484,100.920 shares 1,803,963.645 shares 23,541,362.230 shares | 90.281% 2.056% 7.663% | |||
Number of Shares | ||||||
Fund | Cast/Not Cast | Percentages | ||||
Nationwide NVIT Mid Cap Growth Fund (Formerly Gartmore GVIT Mid Cap Growth Fund) | FOR AGAINST ABSTAIN TOTAL | 10,862,827.499 shares 414,574.660 shares 672,570.741 shares 11,949,972.900 shares | 90.903% 3.469% 5.628% | |||
* | This meeting was previously adjourned on April 23, 2007. | |
** | Fund names were changed effective May 1, 2007 to reflect “Nationwide”/“NVIT” branding to coincide with the sale of Nationwide Fund Advisors, Inc. by Nationwide Corporation to its majority-owned subsidiary, Nationwide Financial Services, Inc. |
Contents | ||
6 | Statement of Investments | |
8 | Statement of Assets and Liabilities | |
10 | Statement of Operations | |
11 | Statements of Changes in Net Assets | |
13 | Financial Highlights | |
14 | Notes to Financial Statements |
SAR-GTC (8/07) | ![]() |
![-s- John H. Grady](https://capedge.com/proxy/N-CSRS/0000893220-07-003038/w37711gradyjh.gif)
Beginning | Ending | |||||||||||||||||||||
Nationwide NVIT Global Technology and | Account Value, | Account Value | Expenses Paid | Annualized | ||||||||||||||||||
Communications Fund | January 1, 2007 | June 30, 2007 | During Period* | Expense Ratio* | ||||||||||||||||||
Class I | Actual | $ | 1,000.00 | $ | 1,135.50 | $ | 6.46 | 1.22% | ||||||||||||||
Hypothetical | 1 | $ | 1,000.00 | $ | 1,018.75 | $ | 6.12 | 1.22% | ||||||||||||||
Class II | Actual | $ | 1,000.00 | $ | 1,136.50 | $ | 7.79 | 1.47% | ||||||||||||||
Hypothetical | 1 | $ | 1,000.00 | $ | 1,017.51 | $ | 7.38 | 1.47% | ||||||||||||||
Class III | Actual | $ | 1,000.00 | $ | 1,136.90 | $ | 6.57 | 1.24% | ||||||||||||||
Hypothetical | 1 | $ | 1,000.00 | $ | 1,018.65 | $ | 6.23 | 1.24% | ||||||||||||||
Class VI | Actual | $ | 1,000.00 | $ | 1,135.80 | $ | 6.99 | 1.32% | ||||||||||||||
Hypothetical | 1 | $ | 1,000.00 | $ | 1,018.25 | $ | 6.63 | 1.32% | ||||||||||||||
* | Expenses are equal to the Fund’s annualized expense ratio multiplied by the average account value over the period multiplied by 181/365 (to reflect the one-half year period). The expense ratio presented represents a six-month, annualized ratio in accordance with SEC guidelines. The expenses reported above do not include the effect of additional expenses imposed by variable annuity contracts. | |
1 | Represents the hypothetical 5% return before expenses. |
Asset Allocation | ||||
Common Stock | 94.5% | |||
Repurchase Agreements | 1.4% | |||
Other Investments* | 16.6% | |||
Liabilities in excess of other assets** | -12.5% | |||
�� | ||||
100.0% |
Top Holdings*** | ||||
Cisco Systems, Inc. | 4.7% | |||
Google, Inc. | 4.3% | |||
Microsoft Corp. | 4.0% | |||
Intel Corp. | 3.9% | |||
International Business Machines Corp. | 3.6% | |||
QUALCOMM, Inc. | 2.7% | |||
Oracle Corp. | 2.7% | |||
Foundry Networks, Inc. | 2.7% | |||
Texas Instruments, Inc. | 2.5% | |||
Dell, Inc. | 2.0% | |||
Other | 66.9% | |||
100.0% |
Top Industries | ||||
Communications Equipment | 22.3% | |||
Software | 20.3% | |||
Semiconductors & Semiconductor Equipment | 17.7% | |||
Computers & Peripherals | 13.0% | |||
Internet Software & Services | 10.4% | |||
IT Services | 8.5% | |||
Wireless Telecommunication Services | 1.0% | |||
Electronic Equipment & Instruments | 0.8% | |||
Household Durables | 0.5% | |||
Other | 5.5% | |||
100.0% |
* | Includes value of collateral received from securities lending. |
** | Includes value of collateral owed from securities lending. |
*** | For purpose of listing top holdings, repurchase agreements are included as part of Other. |
Common Stock (94.5%) | ||||||||
Shares or | ||||||||
Principal Amount | Value | |||||||
Communications Equipment (20.9%) | ||||||||
Alcatel-Lucent ADR - FR | 27,750 | $ | 388,500 | |||||
Cisco Systems, Inc.* | 78,218 | 2,178,371 | ||||||
Comverse Technology, Inc.* | 33,600 | 700,560 | ||||||
Corning, Inc.* | 30,325 | 774,804 | ||||||
Foundry Networks, Inc.* | 73,503 | 1,224,560 | ||||||
Harmonic, Inc.* (a) | 44,220 | 392,231 | ||||||
Juniper Networks, Inc.* | 17,805 | 448,152 | ||||||
Motorola, Inc. | 24,820 | 439,314 | ||||||
Nokia Corp. ADR - FI | 16,095 | 452,430 | ||||||
Nortel Networks Corp.* (a) | 8,845 | 212,722 | ||||||
OpNext, Inc.* (a) | 25,290 | 334,840 | ||||||
Powerwave Technologies, Inc.* | 67,554 | 452,612 | ||||||
QUALCOMM, Inc. | 29,055 | 1,260,697 | ||||||
Sonus Networks, Inc.* (a) | 37,410 | 318,733 | ||||||
9,578,526 | ||||||||
Computers & Peripherals (13.0%) | ||||||||
Apple, Inc.* | 7,029 | 857,819 | ||||||
Dell, Inc.* | 32,924 | 939,980 | ||||||
Gateway, Inc.* (a) | 271,970 | 432,432 | ||||||
Hewlett-Packard Co. | 12,164 | 542,758 | ||||||
International Business Machines Corp. | 15,565 | 1,638,216 | ||||||
Network Appliance, Inc.* | 17,950 | 524,140 | ||||||
Seagate Technology | 15,661 | 340,940 | ||||||
Sun Microsystems, Inc.* | 132,013 | 694,389 | ||||||
5,970,674 | ||||||||
Diversified Telecommunication Services (1.4%) | ||||||||
American Tower Corp.* | 15,075 | 633,150 | ||||||
Electronic Equipment & Instruments (0.8%) | ||||||||
Authentec, Inc.* | 37,800 | 391,230 | ||||||
Household Durables (0.5%) | ||||||||
Syntax-Brillian Corp.* | 42,630 | 209,740 | ||||||
Internet Software & Services (10.4%) | ||||||||
Digital River, Inc.* | 8,860 | 400,915 | ||||||
eBay, Inc.* | 28,945 | 931,450 | ||||||
Google, Inc., Class A* | 3,765 | 1,970,526 | ||||||
Opsware, Inc.* (a) | 36,320 | 345,403 | ||||||
Verisign, Inc.* | 11,590 | 367,751 | ||||||
Vocus, Inc.* | 21,850 | 548,653 | ||||||
Yahoo!, Inc.* | 7,105 | 192,759 | ||||||
4,757,457 | ||||||||
IT Services (8.5%) | ||||||||
Accenture Ltd. | 17,490 | 750,146 | ||||||
Business & Decision* (b) | 22,575 | 716,296 | ||||||
Capgemini SA (b) | 7,800 | 570,186 | ||||||
Cognizant Technology Solutions Corp.* | 11,530 | 865,788 | ||||||
Gartner, Inc.* | 14,708 | 361,670 | ||||||
WNS Holdings Ltd. ADR - IN* (a) | 12,869 | 366,252 | ||||||
Wright Express Corp.* (a) | 7,820 | 267,991 | ||||||
3,898,329 | ||||||||
Semiconductors & Semiconductor Equipment (17.7%) | ||||||||
Anadigics, Inc.* (a) | 26,670 | 367,779 | ||||||
Analog Devices, Inc. | 13,815 | 519,997 | ||||||
Brooks Automation, Inc.* | 23,892 | 433,640 | ||||||
Cirrus Logic, Inc.* | 40,580 | 336,814 | ||||||
Eagle Test Systems, Inc.* (a) | 18,800 | 301,928 | ||||||
Intel Corp. | 75,856 | 1,802,339 | ||||||
Marvell Technology Group Ltd. - BM* | 32,391 | 589,840 | ||||||
MEMC Electronic Materials, Inc.* | 13,640 | 833,677 | ||||||
Microchip Technology, Inc. | 8,110 | 300,394 | ||||||
Qimonda AG ADR - DE* (a) | 48,811 | 754,130 | ||||||
RF Micro Devices, Inc.* | 47,689 | 297,579 | ||||||
SiRF Technology Holdings, Inc.* (a) | 19,557 | 405,612 | ||||||
Texas Instruments, Inc. | 30,776 | 1,158,101 | ||||||
8,101,830 | ||||||||
Software (20.3%) | ||||||||
Adobe Systems, Inc.* | 14,609 | 586,551 | ||||||
Amdocs Ltd. - GG* | 8,506 | 338,709 | ||||||
Autodesk, Inc.* | 12,161 | 572,540 | ||||||
Autonomy Corp. PLC* (b) | 33,600 | 481,914 | ||||||
BEA Systems, Inc.* | 51,340 | 702,844 | ||||||
Borland Software Corp.* (a) | 55,530 | 329,848 | ||||||
Business Objects SA Sponsored ADR - FR* (a) | 5,686 | 220,844 | ||||||
Double-Take Software, Inc.* (a) | 23,215 | 380,958 | ||||||
Glu Mobile, Inc.* (a) | 39,503 | 549,092 | ||||||
Informatica Corp.* (a) | 15,884 | 234,607 | ||||||
McAfee, Inc.* | 13,725 | 483,120 | ||||||
Microsoft Corp. | 61,750 | 1,819,772 | ||||||
Nuance Communications, Inc.* | 20,720 | 346,646 | ||||||
Oracle Corp.* | 62,325 | 1,228,426 | ||||||
Parametric Technology Corp.* (a) | 16,347 | 353,259 | ||||||
UbiSoft Entertainment SA* (b) | 13,214 | 697,160 | ||||||
9,326,290 | ||||||||
Common Stock (continued) | ||||||||
Principal | ||||||||
Amount | Value | |||||||
Wireless Telecommunication Services (1.0%) | ||||||||
SBA Communications Corp.* | 13,864 | $ | 465,692 | |||||
Total Common Stocks (Cost $40,107,127) | 43,332,918 | |||||||
Repurchase Agreements (1.4%) | ||||||||
Nomura Securities, 5.20% dated 06/29/07, due 07/02/07. Repurchase price $637,845, collateralized by U.S. Government Agency Mortgages with a market value of $650,320 | $ | 637,568 | 637,568 | |||||
Securities Held As Collateral for Securities on Loan (16.6%) | ||||||||
Morgan Stanley Repurchase Agreement, 5.42%, dated 06/29/07, due 07/02/07, Repurchase price $7,633,073, collateralized by U.S. Government Agency Mortgages with a market value of $7,782,220, | 7,629,628 | 7,629,628 | ||||||
Total Investments (Cost $48,374,323) (c) — 112.5% | 51,600,114 | |||||||
Liabilities in excess of other assets — (12.5)% | (5,734,654 | ) | ||||||
NET ASSETS — 100.0% | $ | 45,865,460 | ||||||
* | Denotes a non-income producing security. | |
(a) | All or a part of the security was on loan as of June 30, 2007. | |
(b) | Fair Valued Security. | |
(c) | See notes to financial statements for tax unrealized appreciation (depreciation) of securities. |
ADR | American Depository Receipt | |
BM | Bermuda | |
DE | Germany | |
FI | Finland | |
FR | France | |
GG | Guernsey | |
IN | India |
Nationwide NVIT | ||||||
Global Technology and | ||||||
Communications Fund | ||||||
Assets: | ||||||
Investments, at value (cost $40,107,127)* | $ | 43,332,918 | ||||
Repurchase agreements, at cost and value | 8,267,196 | |||||
Total Investments | 51,600,114 | |||||
Foreign currencies, at value (cost $1,058,816) | 1,040,361 | |||||
Interest and dividends receivable | 7,277 | |||||
Receivable for capital shares issued | 15,890 | |||||
Receivable for investments sold | 2,754,648 | |||||
Prepaid expenses | 558 | |||||
Total Assets | 55,418,848 | |||||
Liabilities: | ||||||
Payable to custodian | 3,783 | |||||
Payable for investments purchased | 1,793,620 | |||||
Payable upon return of securities loaned | 7,629,627 | |||||
Payable for capital shares redeemed | 1,262 | |||||
Accrued expenses and other payables: | ||||||
Investment advisory fees | 104,457 | |||||
Fund administration and transfer agent fees | 1,901 | |||||
Distribution fees | 1,902 | |||||
Administrative servicing fees | 5,765 | |||||
Compliance program costs | 627 | |||||
Other | 10,444 | |||||
Total Liabilities | 9,553,388 | |||||
Net Assets | $ | 45,865,460 | ||||
Represented by: | ||||||
Capital | $ | 45,835,326 | ||||
Accumulated net investment loss | (134,286 | ) | ||||
Accumulated net realized losses from investment transactions and foreign currency transactions | (3,042,914 | ) | ||||
Net unrealized appreciation on investments and translation of assets and liabilities denominated in foreign currencies | 3,207,334 | |||||
Net Assets | $ | 45,865,460 | ||||
Net Assets: | ||||||
Class I Shares | $ | 14,852,005 | ||||
Class II Shares | 1,491,908 | |||||
Class III Shares | 21,604,215 | |||||
Class VI Shares | 7,917,332 | |||||
Total | $ | 45,865,460 | ||||
Shares outstanding (unlimited number of shares authorized): | ||||||
Class I Shares | 3,057,033 | |||||
Class II Shares | 309,142 | |||||
Class III Shares | 4,410,127 | |||||
Class VI Shares | 1,633,686 | |||||
Total | 9,409,988 | |||||
Nationwide NVIT | ||||
Global Technology and | ||||
Communications Fund | ||||
Net asset value and offering price per share (Net assets by class divided by shares outstanding by class, respectively.): | ||||
Class I Shares | $ | 4.86 | ||
Class II Shares | $ | 4.83 | ||
Class III Shares | $ | 4.90 | ||
Class VI Shares | $ | 4.85 |
* | Includes value of securities on loan of $7,359,644. |
Nationwide NVIT Global | |||||
Technology and | |||||
Communications Fund | |||||
INVESTMENT INCOME: | |||||
Interest income | $ | 32,658 | |||
Dividend income | 105,396 | ||||
Income from securities lending | 11,439 | ||||
Foreign tax withholding | (1,118 | ) | |||
Total Income | 148,375 | ||||
Expenses: | |||||
Investment advisory fees | 209,233 | ||||
Fund administration and transfer agent fees | 15,098 | ||||
Distribution fees Class II Shares | 1,798 | ||||
Distribution fees Class VI Shares | 8,934 | ||||
Administrative servicing fees Class I Shares | 10,545 | ||||
Administrative servicing fees Class II Shares | 1,047 | ||||
Administrative servicing fees Class III Shares | 18,229 | ||||
Custodian fees | 1,294 | ||||
Trustee fees | 1,054 | ||||
Compliance program costs (Note 3) | 361 | ||||
Other | 15,465 | ||||
Total expenses before earnings credit | 283,058 | ||||
Earnings credit (Note 6) | (397 | ) | |||
Net Expenses | 282,661 | ||||
Net Investment Loss | (134,286 | ) | |||
REALIZED/ UNREALIZED GAINS (LOSSES) FROM INVESTMENTS: | |||||
Net realized gains on investment transactions | 4,883,876 | ||||
Net realized losses on foreign currency transactions | (11,838 | ) | |||
Net realized gains on investment transactions and foreign currency transactions | 4,872,038 | ||||
Net change in unrealized appreciation on investments and translation of assets and liabilities denominated in foreign currencies | 944,748 | ||||
Net realized/unrealized gains (losses) on investments and translation of assets and liabilities denominated in foreign currencies | 5,816,786 | ||||
CHANGE IN NET ASSETS RESULTING FROM OPERATIONS | $ | 5,682,500 | |||
Nationwide NVIT Global Technology | ||||||||||
and Communications Fund | ||||||||||
Six Months | Year Ended | |||||||||
Ended | December 31, | |||||||||
June 30, 2007 | 2006 | |||||||||
(Unaudited) | ||||||||||
From Investment Activities: | ||||||||||
Operations: | ||||||||||
Net investment loss | $ | (134,286 | ) | $ | (218,887 | ) | ||||
Net realized gains on investment transactions and foreign currency transactions | 4,872,038 | 3,339,802 | ||||||||
Net change in unrealized appreciation on investments and translation of assets and liabilities denominated in foreign currencies | 944,748 | 1,150,137 | ||||||||
Change in net assets resulting from operations | 5,682,500 | 4,271,052 | ||||||||
Change in net assets from capital transactions | (9,165,292 | ) | 6,957,378 | |||||||
Change in net assets | (3,482,792 | ) | 11,228,430 | |||||||
Net Assets: | ||||||||||
Beginning of period | 49,348,252 | 38,119,822 | ||||||||
End of period | $ | 45,865,460 | $ | 49,348,252 | ||||||
Accumulated net investment income (loss) at end of period | $ | (134,286 | ) | $ | – | |||||
CAPITAL TRANSACTIONS: | ||||||||||
Class I Shares | ||||||||||
Proceeds from shares issued | $ | 3,095,073 | $ | 9,165,165 | ||||||
Cost of shares redeemed(a) | (7,694,517 | ) | (7,978,266 | ) | ||||||
(4,599,444 | ) | 1,186,899 | ||||||||
Class II Shares | ||||||||||
Proceeds from shares issued | 537 | 6,473 | ||||||||
Cost of shares redeemed(a) | (134,644 | ) | (279,498 | ) | ||||||
(134,107 | ) | (273,025 | ) | |||||||
Class III Shares | ||||||||||
Proceeds from shares issued | 4,121,259 | 13,887,206 | ||||||||
Cost of shares redeemed(a) | (8,577,579 | ) | (10,758,480 | ) | ||||||
(4,456,320 | ) | 3,128,726 | ||||||||
Class VI Shares | ||||||||||
Proceeds from shares issued | 2,694,396 | 5,689,971 | ||||||||
Cost of shares redeemed(a) | (2,669,817 | ) | (2,775,193 | ) | ||||||
24,579 | 2,914,778 | |||||||||
Change in net assets from capital transactions | $ | (9,165,292 | ) | $ | 6,957,378 | |||||
SHARE TRANSACTIONS: | ||||||||||
Class I Shares | ||||||||||
Issued | 696,772 | 2,211,282 | ||||||||
Redeemed | (1,761,634 | ) | (1,989,020 | ) | ||||||
(1,064,862 | ) | 222,262 | ||||||||
Class II Shares | ||||||||||
Issued | 28 | 1,340 | ||||||||
Redeemed | (30,156 | ) | (72,674 | ) | ||||||
(30,128 | ) | (71,334 | ) | |||||||
Nationwide NVIT Global Technology | |||||||||
and Communications Fund | |||||||||
Six Months | Year Ended | ||||||||
Ended | December 31, | ||||||||
June 30, 2007 | 2006 | ||||||||
(Unaudited) | |||||||||
Class III Shares | |||||||||
Issued | 903,688 | 3,453,364 | |||||||
Redeemed | (1,886,990 | ) | (2,694,465 | ) | |||||
(983,302 | ) | 758,899 | |||||||
Class VI Shares | |||||||||
Issued | 595,103 | 1,408,404 | |||||||
Redeemed | (605,570 | ) | (690,571 | ) | |||||
(10,467 | ) | 717,833 | |||||||
Total change in shares | (2,088,759 | ) | 1,627,660 | ||||||
(a) | Includes redemption fees, if any. |
Investment Activities | ||||||||||||||||
Net Realized | ||||||||||||||||
and | ||||||||||||||||
Net Asset | Net | Unrealized | Total | |||||||||||||
Value, | Investment | Gains | from | |||||||||||||
Beginning | Income | (Losses) on | Investment | |||||||||||||
of Period | (Loss) | Investments | Activities | |||||||||||||
Class I Shares | ||||||||||||||||
For the year ended December 31, 2002 | $ | 4.21 | (0.03 | ) | (1.77 | ) | (1.80 | ) | ||||||||
For the year ended December 31, 2003 | $ | 2.39 | (0.03 | ) | 1.35 | 1.32 | ||||||||||
For the year ended December 31, 2004 | $ | 3.71 | (0.02 | ) | 0.18 | 0.16 | ||||||||||
For the year ended December 31, 2005 | $ | 3.87 | (0.02 | ) | – | (0.02 | ) | |||||||||
For the year ended December 31, 2006 | $ | 3.85 | (0.02 | ) | 0.45 | 0.43 | ||||||||||
For the six months ended June 30, 2007 (Unaudited) | $ | 4.28 | (0.01 | ) | 0.59 | 0.58 | ||||||||||
Class II Shares | ||||||||||||||||
Period ended December 31, 2003 (f) | $ | 2.45 | (0.01 | ) | 1.28 | 1.27 | ||||||||||
For the year ended December 31, 2004 | $ | 3.72 | (0.05 | ) | 0.20 | 0.15 | ||||||||||
For the year ended December 31, 2005 | $ | 3.87 | (0.04 | ) | 0.01 | (0.03 | ) | |||||||||
For the year ended December 31, 2006 | $ | 3.84 | (0.03 | ) | 0.44 | 0.41 | ||||||||||
For the six months ended June 30, 2007 (Unaudited) | $ | 4.25 | (0.02 | ) | 0.60 | 0.58 | ||||||||||
Class III Shares | ||||||||||||||||
Period ended December 31, 2002 (e) | $ | 3.29 | (0.01 | ) | (0.85 | ) | (0.86 | ) | ||||||||
For the year ended December 31, 2003 | $ | 2.41 | (0.02 | ) | 1.35 | 1.33 | ||||||||||
For the year ended December 31, 2004 | $ | 3.74 | (0.04 | ) | 0.20 | 0.16 | ||||||||||
For the year ended December 31, 2005 | $ | 3.90 | (0.02 | ) | – | (0.02 | ) | |||||||||
For the year ended December 31, 2006 | $ | 3.88 | (0.02 | ) | 0.45 | 0.43 | ||||||||||
For the six months ended June 30, 2007 (Unaudited) | $ | 4.31 | (0.01 | ) | 0.60 | 0.59 | ||||||||||
Class VI Shares | ||||||||||||||||
Period ended December 31, 2004 (h) | $ | 3.59 | (0.01 | ) | 0.29 | 0.28 | ||||||||||
For the year ended December 31, 2005 | $ | 3.87 | (0.02 | ) | (0.01 | ) | (0.03 | ) | ||||||||
For the year ended December 31, 2006 | $ | 3.84 | (0.02 | ) | 0.45 | 0.43 | ||||||||||
For the six months ended June 30, 2007 (Unaudited) | $ | 4.27 | (0.01 | ) | 0.59 | 0.58 |
[Additional columns below]
[Continued from above table, first column(s) repeated]
Distributions | Ratios/Supplemental Data | |||||||||||||||||||||||
Net Assets | Ratio of | |||||||||||||||||||||||
Net Asset | at End of | Expenses to | ||||||||||||||||||||||
Return of | Total | Value, End | Total | Period | Average Net | |||||||||||||||||||
Capital | Distributions | of Period | Return (a) | (000s) | Assets (b) | |||||||||||||||||||
Class I Shares | ||||||||||||||||||||||||
For the year ended December 31, 2002 | (0.02 | ) | (0.02 | ) | $ | 2.39 | (42.78% | ) | $ | 7,791 | 1.34% | |||||||||||||
For the year ended December 31, 2003 | – | – | $ | 3.71 | 55.23% | $ | 15,960 | 1.24% | ||||||||||||||||
For the year ended December 31, 2004 | – | – | $ | 3.87 | 4.31% | $ | 20,144 | 1.30% | ||||||||||||||||
For the year ended December 31, 2005 | – | – | $ | 3.85 | (0.52% | ) | $ | 15,010 | 1.28% | |||||||||||||||
For the year ended December 31, 2006 | – | – | $ | 4.28 | 11.17% | $ | 17,631 | 1.15% | ||||||||||||||||
For the six months ended June 30, 2007 (Unaudited) | – | – | $ | 4.86 | 13.55% | $ | 14,852 | 1.22% | ||||||||||||||||
Class II Shares | ||||||||||||||||||||||||
Period ended December 31, 2003 (f) | – | – | $ | 3.72 | 51.84% | $ | 2,128 | 1.49% | ||||||||||||||||
For the year ended December 31, 2004 | – | – | $ | 3.87 | 4.03% | $ | 2,409 | 1.53% | ||||||||||||||||
For the year ended December 31, 2005 | – | – | $ | 3.84 | (0.78% | ) | $ | 1,575 | 1.53% | |||||||||||||||
For the year ended December 31, 2006 | – | – | $ | 4.25 | 10.68% | $ | 1,443 | 1.39% | ||||||||||||||||
For the six months ended June 30, 2007 (Unaudited) | – | – | $ | 4.83 | 13.65% | $ | 1,492 | 1.47% | ||||||||||||||||
Class III Shares | ||||||||||||||||||||||||
Period ended December 31, 2002 (e) | (0.02 | ) | (0.02 | ) | $ | 2.41 | (26.14% | ) | $ | 5,822 | 1.37% | |||||||||||||
For the year ended December 31, 2003 | – | – | $ | 3.74 | 55.19% | $ | 33,398 | 1.25% | ||||||||||||||||
For the year ended December 31, 2004 | – | – | $ | 3.90 | 4.28% | $ | 22,656 | 1.28% | ||||||||||||||||
For the year ended December 31, 2005 | – | – | $ | 3.88 | (0.51% | ) | $ | 17,975 | 1.29% | |||||||||||||||
For the year ended December 31, 2006 | – | – | $ | 4.31 | 11.08% | $ | 23,256 | 1.14% | ||||||||||||||||
For the six months ended June 30, 2007 (Unaudited) | – | – | $ | 4.90 | 13.69% | $ | 21,604 | 1.24% | ||||||||||||||||
Class VI Shares | ||||||||||||||||||||||||
Period ended December 31, 2004 (h) | – | – | $ | 3.87 | 7.80% | $ | 2,693 | 1.46% | ||||||||||||||||
For the year ended December 31, 2005 | – | – | $ | 3.84 | (0.78% | ) | $ | 3,559 | 1.39% | |||||||||||||||
For the year ended December 31, 2006 | – | – | $ | 4.27 | 11.20% | $ | 7,018 | 1.24% | ||||||||||||||||
For the six months ended June 30, 2007 (Unaudited) | – | – | $ | 4.85 | 13.58% | $ | 7,917 | 1.32% |
[Additional columns below]
[Continued from above table, first column(s) repeated]
Ratios/Supplemental Data | ||||||||||||||||||
Ratio of | Ratio of | Investment | ||||||||||||||||
Net | Expenses | Income (Loss) | ||||||||||||||||
Investment | (Prior to | (Prior to | ||||||||||||||||
Income | Reimbursements) | Reimbursements) | ||||||||||||||||
(Loss) to | to Average | to Average | ||||||||||||||||
Average Net | Net | Net | Portfolio | |||||||||||||||
Assets (b) | Assets (b)(c) | Assets (b)(c) | Turnover (d) | |||||||||||||||
Class I Shares | ||||||||||||||||||
For the year ended December 31, 2002 | (0.65% | ) | 1.39% | (0.70% | ) | 879.28% | ||||||||||||
For the year ended December 31, 2003 | (0.94% | ) | (g) | (g) | 1,045.37% | |||||||||||||
For the year ended December 31, 2004 | (0.69% | ) | (g) | (g) | 728.29% | |||||||||||||
For the year ended December 31, 2005 | (0.63% | ) | (g) | (g) | 571.34% | |||||||||||||
For the year ended December 31, 2006 | (0.55% | ) | (g) | (g) | 352.39% | |||||||||||||
For the six months ended June 30, 2007 (Unaudited) | (0.56% | ) | 1.23% | (0.56% | ) | 117.24% | ||||||||||||
Class II Shares | ||||||||||||||||||
Period ended December 31, 2003 (f) | (1.27% | ) | (g) | (g) | 1,045.37% | |||||||||||||
For the year ended December 31, 2004 | (0.98% | ) | (g) | (g) | 728.29% | |||||||||||||
For the year ended December 31, 2005 | (0.89% | ) | (g) | (g) | 571.34% | |||||||||||||
For the year ended December 31, 2006 | (0.79% | ) | (g) | (g) | 352.39% | |||||||||||||
For the six months ended June 30, 2007 (Unaudited) | (0.81% | ) | 1.47% | (0.81% | ) | 117.24% | ||||||||||||
Class III Shares | ||||||||||||||||||
Period ended December 31, 2002 (e) | (3.49% | ) | 1.79% | (3.91% | ) | 879.28% | ||||||||||||
For the year ended December 31, 2003 | (1.00% | ) | (g) | (g) | 1,045.37% | |||||||||||||
For the year ended December 31, 2004 | (0.73% | ) | (g) | (g) | 728.29% | |||||||||||||
For the year ended December 31, 2005 | (0.64% | ) | (g) | (g) | 571.34% | |||||||||||||
For the year ended December 31, 2006 | (0.55% | ) | (g) | (g) | 352.39% | |||||||||||||
For the six months ended June 30, 2007 (Unaudited) | (0.59% | ) | 1.24% | (0.59% | ) | 117.24% | ||||||||||||
Class VI Shares | ||||||||||||||||||
Period ended December 31, 2004 (h) | (0.44% | ) | (g) | (g) | 728.29% | |||||||||||||
For the year ended December 31, 2005 | (0.73% | ) | (g) | (g) | 571.34% | |||||||||||||
For the year ended December 31, 2006 | (0.65% | ) | (g) | (g) | 352.39% | |||||||||||||
For the six months ended June 30, 2007 (Unaudited) | (0.65% | ) | 1.33% | (0.65% | ) | 117.24% |
(a) | Not annualized for periods less than one year. | |
(b) | Annualized for periods less than one year. | |
(c) | During the period, certain fees were waived and/or reimbursed. If such waivers/reimbursements had not occurred, the ratios would have been as indicated. | |
(d) | Portfolio turnover is calculated on the basis of the Fund as a whole without distinguishing among the classes of shares. | |
(e) | For the period from May 2, 2002 (commencement of operations) through December 31, 2002. | |
(f) | For the period from March 28, 2003 (commencement of operations) through December 31, 2003. | |
(g) | There were no fee waivers/reimbursements during the period. | |
(h) | For the period from April 28, 2004 (commencement of operations) through December 31, 2004. |
(a) | Security Valuation |
Securities for which market quotations are readily available are valued at current market value as of “Valuation Time.” Valuation Time is as of the close of regular trading on the New York Stock Exchange (usually 4 p.m. Eastern time). Equity securities are valued at the last quoted sale price or, if there is no sale price, the last quoted bid price provided by an independent pricing service approved by the Trust’s Board of Trustees (“Board of Trustees”). Securities traded on NASDAQ are valued at the NASDAQ official closing price. Prices are taken from the primary market or exchange in which each security trades. | |
Most securities listed on a foreign exchange are valued either at fair value (see description below) or at the last sale price at the close of the exchange on which the security is principally traded. Foreign securities, currencies, and other assets and liabilities denominated in foreign currencies are translated into U.S. dollars at the exchange rate of said currencies against the U.S. dollar, as of Valuation Time, as provided by an independent pricing service approved by the Board of Trustees. | |
Securities for which market quotations are not readily available, or for which an independent pricing service does not provide a value or provides a value that does not represent fair value in the judgment of the Fund’s investment adviser or designee, are valued at fair value under procedures approved by the Board of Trustees. The “Fair Value” of these securities is determined in good faith by taking into account relevant factors and surrounding circumstances. Methods utilized to obtain a “Fair Value” may include the following non-exclusive list of acceptable methods: (i) a multiple of earnings; (ii) the discount from market value of a similar, freely traded security; (iii) the yield-to-maturity for debt issues; or (iv) a consolidation of the methods. The Trust’s Valuation & Operations Committee considers a non-exclusive list of factors to arrive at the appropriate method of determining “Fair Value.” For example, fair value determinations are required for securities whose value is affected by a “significant” event that materially affects the value of a domestic or foreign security which occurs subsequent to the time of the close of the principal market on which such domestic or foreign security trades and before the Valuation Time (i.e., a “subsequent event”). Typically, |
this will involve events occurring after the close of a foreign market on which a security trades and before the next Valuation Time. | |
The Fund values foreign securities at fair value in the circumstances described below. Generally, trading in foreign securities markets is completed each day at various times prior to the Valuation Time. Due to the time differences between the closings of the relevant foreign securities exchanges and the Valuation Time for the Fund, the Fund will fair value its foreign investments when it is determined that the market quotations for the foreign investments either are not readily available or are unreliable and, therefore, do not represent fair value. When the fair value prices are utilized, these prices will attempt to reflect the impact of the U.S. financial markets’ perceptions and trading activities on the Fund’s foreign investments since the last closing prices of the foreign investments were calculated on their primary foreign securities markets or exchanges. For these purposes, the Board of Trustees has determined that movements in relevant indices or other appropriate market indicators, after the close of the foreign securities exchanges, may demonstrate that market quotations are unreliable, and may trigger fair value pricing for certain securities. Consequently, fair valuation of portfolio securities may occur on a daily basis. |
(b) | Repurchase Agreements |
The Fund may enter into repurchase agreements with an entity which is a member of the Federal Reserve System or which is a “primary dealer” (as designated by the Federal Reserve Bank of New York) in U.S. Government obligations. The repurchase price generally equals the price paid by the Fund plus interest negotiated on the basis of current short-term rates, which may be more or less than the rate on the underlying portfolio securities. The seller under a repurchase agreement is required to maintain the value of the collateral held pursuant to the agreement at a market value equal to or greater than the repurchase price (including accrued interest). Collateral subject to repurchase agreements is held by the Fund’s custodian or another qualified sub-custodian or in the Federal Reserve/ Treasury book-entry system. If the counterparty defaults and the fair value of the collateral declines, realization of the collateral by the Fund may be delayed or limited. The Fund may transfer uninvested cash balances into a pooled cash account. These balances are invested in one or more repurchase agreements, with the counterparty of Nomura Securities, which is fully collateralized by U.S. Government Agency Mortgages. |
(c) | Foreign Currency Transactions |
The accounting records of the Fund are maintained in U.S. dollars. Foreign currency amounts are translated into U.S. dollars at the current rate of exchange to determine the value of investments, assets and liabilities. The Fund may enter into foreign currency contracts in connection with purchases or sales of securities denominated in a foreign currency. Purchases and sales of securities, and income and expenses, are translated at the prevailing rate of exchange on the respective date of these transactions. The Fund does not isolate that portion of the results of operations resulting from changes in foreign exchange rates on investments from fluctuations arising from changes in market prices of securities held. These fluctuations are included with the net realized and unrealized gain or loss from investments and foreign currencies. |
(d) | Forward Foreign Currency Contracts |
The Fund may enter into forward foreign currency contracts in connection with planned purchases or sales of securities or to hedge the U.S. dollar value of portfolio securities denominated in a particular currency. The Fund could be exposed to risks if the counterparties to the contracts are unable to meet the terms of their contracts and from unanticipated movements in the value of a foreign currency relative to the U.S. dollar. Forward foreign currency contracts are valued at the current cost of covering these contracts, as provided by an independent pricing service approved by the Board of Trustees. The forward foreign currency contracts are adjusted by the daily exchange rate of the underlying currency and any gains or losses are recorded for financial statement purposes as unrealized gains or losses until the contract settlement date. |
(e) | Futures Contracts |
The Fund may invest in financial futures contracts (“futures contracts”) for the purpose of hedging its existing portfolio securities or securities that the Fund intends to purchase against fluctuations in value caused by changes in prevailing market interest rates or prices. Futures contracts may also be entered into for non-hedging purposes. | |
Upon entering into a futures contract, the Fund is required to pledge to the broker an amount of cash and/or other assets equal to a certain percentage of the contract amount (initial margin deposit). Subsequent payments, known as “variation margin,” are made each day, depending on the daily fluctuations in the fair value/ market value of the underlying assets. A gain or loss equal to the daily variation margin is recognized on a daily basis. Futures contracts are valued daily at their last quoted sale price. | |
A “sale” of a futures contract means the creation of a contractual obligation to deliver the securities or foreign currency called for by the contract at a fixed price at a specified time in the future. A “purchase” of a futures contract means the creation of a contractual obligation to acquire the securities or foreign currency at a fixed price at a specified time in the future. | |
Should market conditions change unexpectedly, the Fund may not achieve the anticipated benefits of the futures contracts and may realize a loss. The use of futures transactions for hedging purposes involves the risk of imperfect correlation in movements in the price of futures contracts, interest rates, and the value of the underlying hedged assets. |
(f) | Written Options Contracts |
The Fund may write options contracts. A written option obligates the Fund to deliver (written call) or to receive (written put) a specified quantity of an underlying asset at the contract amount upon exercise by the holder of the option. When the Fund writes an option, an amount equal to the premium received by the Fund is recorded as a liability and is subsequently adjusted to the current fair value of the option written. Premiums received from writing options that expire unexercised are treated by the Fund on the expiration date as realized gains from investments. The difference between the premium and the amount paid on effecting a closing purchase transaction, as a realized loss. If a call option is exercised, the premium is added to the proceeds from the sale of the underlying security or currency in determining whether the Fund has realized a gain or loss. If a put option is exercised, the premium reduces the cost basis of the securities purchased by the Fund. Options traded on an exchange are valued at the last quoted sale price, or in the absence of a sale, the bid price provided by an independent pricing service approved by the Board of Trustees. Non-exchange traded options are valued using dealer supplied quotes. The Fund as a writer of an option bears the market risk of an unfavorable change in the price of the security underlying the written option. |
(g) | Short Sales |
The Fund is authorized to engage in short-selling of portfolio securities which obligates the Fund to replace any security that the Fund has borrowed by purchasing the security at current market value sometime in the future. The Fund will incur a loss if the price of the security increases between the date of the short sale and the date on which the Fund replaces the borrowed security. The Fund generally will realize a gain if the price of the security declines between these dates. Until the Fund replaces the borrowed security, the Fund will maintain a segregated account with cash, U.S. Government securities and/or securities held long to sufficiently cover the Fund’s short position on a daily basis. Dividends declared on securities sold short are recorded as an expense on the ex-dividend date and paid to the counterparty on the dividend pay date. |
(h) | Security Transactions and Investment Income |
Security transactions are accounted for on the date the security is purchased or sold (“trade date”). Securities gains and losses are calculated on the identified cost basis. Interest income is recognized on the accrual basis and includes, where applicable, the amortization or accretion of premium or discount. Dividend income is recorded on the ex-dividend date. |
(i) | Securities Lending |
To generate additional income, the Fund may lend its portfolio securities, up to 331/3% of the Fund, to brokers, dealers and other financial institutions provided that (1) the borrower delivers cash or securities as collateral with respect to each new loan of U.S. securities, equal to at least 102% of the value of the portfolio securities loaned, and with respect to each new loan on non-U.S. securities, collateral of at least 105% of the value of the portfolio securities loaned; and (2) at all times thereafter shall require the borrower to mark-to-market the collateral on a daily basis so that the market value of such collateral does not fall below 100% of the value of securities loaned. The Fund receives payments from borrowers equivalent to the dividends and interest that would have been earned on securities loaned while simultaneously seeking to earn income on the investment of cash collateral. There may be risks of delay in recovery of the securities should the borrower of the securities fail financially. Loans will be made, however, only to borrowers deemed by the Fund’s investment adviser to be of good standing and creditworthy under guidelines established by the Board of Trustees and when, in judgment of the adviser, the consideration which can be earned currently from these securities loans justifies the attendant risks. Loans are subject to termination by the Fund or the borrower at any time, and, therefore, are not considered to be illiquid investments. JPMorgan Chase Bank serves as custodian for the securities lending program of the Fund. JPMorgan Chase Bank receives a fee based on the value of the collateral received from borrowers. | |
Information on the investment of cash collateral is shown in the Statement of Investments. | |
As of June 30, 2007, the Fund had securities with the following value on loan: |
Value of | ||||||
Value of Loaned Securities | Collateral | |||||
$7,359,644 | $ | 7,629,627 | ||||
(j) | Distributions to Shareholders |
The Fund’s dividends from net investment income, if any, are declared and paid quarterly. The Fund’s distributions from net realized capital gains, if any, are declared and distributed at least annually. | |
Dividends and distributions to shareholders are determined in accordance with federal income tax regulations, which may differ from GAAP. These “book/tax” differences are considered either permanent or temporary in nature. In accordance with the American Institute of Certified Public Accountants Statement of Position 93-2, permanent differences (i.e., reclassification of market discounts, foreign exchange gain/loss, paydowns, and distributions from real estate investment trusts) are reclassified within the capital accounts based on their nature for federal income tax purposes; temporary differences do not require reclassification. These reclassifications have no effect upon the net asset value of the Fund. To the extent distributions exceed current and accumulated earnings and profits for federal income tax purposes, these distributions are reported as distributions of paid-in-capital. |
(k) | Federal Income Taxes |
It is the policy of the Fund to qualify or to continue to qualify as a “regulated investment company” by complying with the provisions available to certain investment companies, as defined in Subchapter M of the U.S. Internal Revenue Code, and to make distributions of net investment income and net realized capital gains sufficient to relieve the Fund from all, or substantially all, federal income taxes. |
As of June 30, 2007, the tax cost of securities and the breakdown of unrealized appreciation (depreciation) for the Fund was as follows: |
Net | ||||||||||||||||
Unrealized | ||||||||||||||||
Tax Cost of | Unrealized | Unrealized | Appreciation | |||||||||||||
Securities | Appreciation | Depreciation | (Depreciation) | |||||||||||||
$ | 49,063,704 | $ | 3,031,467 | $ | (495,057 | ) | $ | 2,536,410 | ||||||||
(l) | Allocation of Expenses, Income, and Gains and Losses |
Expenses directly attributable to the Fund are charged to the Fund. Expenses not directly attributable to the Fund are allocated proportionately among various or all funds within the Trust. The method used by the Fund for allocating income, fund level expenses, and realized and unrealized gains or losses is based on the fair value of shares outstanding relative to net assets. Under this method, each class of shares participates based on the total net asset value of that class’s shares in proportion to the total net assets of the Fund. Expenses specific to a class (such as Rule 12b-1 and administrative services fees) are charged to that class. |
Base Management Fee | Fees | |||||
$0 up to $500 million | 0.88% | |||||
$500 million up to $2 billion | 0.83% | |||||
$2 billion and more | 0.78% | |||||
Out or Underperformance | Change in Fees | |||||
+/- 1 percentage point | +/- 0.02% | |||||
+/- 2 percentage point | +/- 0.04% | |||||
+/- 3 percentage point | +/- 0.06% | |||||
+/- 4 percentage point | +/- 0.08% | |||||
+/- 5 percentage point | +/- 0.10% | |||||
Combined Fee Schedule* | ||||||
Up to $1 billion | 0.15% | |||||
$1 billion up to $3 billion | 0.10% | |||||
$3 billion up to $8 billion | 0.05% | |||||
$8 billion up to $10 billion | 0.04% | |||||
$10 billion up to $12 billion | 0.02% | |||||
$12 billion or more | 0.01% | |||||
* | The assets of the Nationwide NVIT Investor Destinations Aggressive Fund, the Nationwide NVIT Investor Destinations Moderately Aggressive Fund, the Nationwide NVIT Investor Destinations Moderate Fund, the Nationwide NVIT Investor Destinations Moderately Conservative Fund, and the Nationwide NVIT Investor Destinations Conservative Fund (collectively, the “Investor Destinations Funds”) are excluded from the Trust asset level amount in order to calculate this asset-based fee. The Investor Destinations Funds do not pay any part of this fee. |
Number of Portfolios | ||||||||||
Position(s) Held | in the | |||||||||
with the Trust | Principal Occupation(s) | Nationwide Fund | Other | |||||||
Name, Address | and Length of | During Past | Complex Overseen | Directorships | ||||||
and Year of Birth | Time Served1 | Five Years | by Trustee | Held by Trustee2 | ||||||
Charles E. Allen c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1948 | Trustee since July 2000 | Mr. Allen is Chairman, Chief Executive Officer and President of Graimark Realty Advisors, Inc. (real estate development, investment and asset management). | 89 | None | ||||||
Paula H.J. Cholmondeley c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1947 | Trustee since July 2000 | Ms. Cholmondeley was Vice President and General Manager of Sappi Fine Paper North America from April 2000 through December 2003. | 89 | Director of Dentsply International, Inc. (dental products), Ultralife Batteries, Inc., Terex Corporation (construction equipment), Minerals Technology, Inc. (specialty chemicals) and Albany International Corp. (paper industry) | ||||||
C. Brent DeVore3 c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1940 | Trustee since 1990 | Dr. DeVore is President of Otterbein College. | 89 | None | ||||||
Phyllis Kay Dryden c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1947 | Trustee since December 2004 | Ms. Dryden was a partner of Mitchell Madison, a management consulting company from January 2006 until December 2006; she is currently a consultant with the company. Ms. Dryden was formerly Managing Partner of march FIRST, a global management consulting firm. | 89 | None | ||||||
Barbara L. Hennigar c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1935 | Trustee since July 2000 | Retired. | 89 | None | ||||||
Number of Portfolios | ||||||||||
Position(s) Held | in the | |||||||||
with the Trust | Principal Occupation(s) | Nationwide Fund | Other | |||||||
Name, Address | and Length of | During Past | Complex Overseen | Directorships | ||||||
and Year of Birth | Time Served1 | Five Years | by Trustee | Held by Trustee2 | ||||||
Barbara I. Jacobs c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1950 | Trustee since December 2004 | Ms. Jacobs served as Chairman of the Board of Directors of KICAP Network Fund, a European (United Kingdom) hedge fund, from January 2001 through January 2006. From 1998-2003, Ms. Jacobs was also a Managing Director and European Portfolio Manager of CREF Investments (Teachers Insurance and Annuity Association-College Retirement Equities Fund). | 89 | None | ||||||
Douglas F. Kridler c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1955 | Trustee since September 1997 | Mr. Kridler has served as the President and Chief Executive Officer of the Columbus Foundation (a Columbus, OH-based foundation which manages over 1,300 individual endowment funds) since February 2002. Prior to January 31, 2002, Mr. Kridler was the President of the Columbus Association for the Performing Arts and Chairman of the Greater Columbus Convention and Visitors Bureau. | 89 | None | ||||||
Michael D. McCarthy c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1947 | Trustee since December 2004 | Retired. Mr. McCarthy was Chairman of VMAC (commodity swaps) from October 2002 until January 2007; and a partner of Pineville Properties LLC (a commercial real estate development firm) from September 2000 until January 2007. | 89 | None | ||||||
David C. Wetmore c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1948 | Trustee since 1995 and Chairman since February 2005 | Retired. | 89 | None | ||||||
1 | Length of time served includes time served with the Trust’s predecessors. | |
2 | Directorships held in (1) any other investment companies registered under the 1940 Act, (2) any company with a class of securities registered pursuant to Section 12 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or (3) any company subject to the requirements of Section 15(d) of the Exchange Act. | |
3 | Mr. DeVore has served as President of Otterbein College since 1984. Mark Thresher, President and Chief Operating Officer of Nationwide Financial Services, Inc. (“NFS”) has served as a member of the Board of Trustees of Otterbein College since 2000, currently serves as one of 30 of its trustees, and is currently one of two Vice Chairmen of the Board. Each of Nationwide Fund Advisors (“NFA”), the Funds’ investment adviser, and Nationwide Fund Distributors LLC (“NFD”), principal underwriter to the Trust, is a wholly-owned subsidiary of NFS. | |
Additional information regarding the Trustees and Officers may be found in the Trust’s Statement of Additional Information, which is available without charge upon request, by calling 800-848-0920. |
Number of Portfolios | ||||||||||
Position(s) Held | in the | |||||||||
with the Trust | Principal Occupation(s) | Nationwide Fund | Other | |||||||
Name, Address | and Length of | During Past | Complex Overseen | Directorships | ||||||
and Year of Birth | Time Served1 | 5 Years | by Trustee | Held by Trustee 2 | ||||||
Arden L. Shisler c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1941 | Trustee since February 2000 | Retired. Mr. Shisler is the former President and Chief Executive Officer of KeB Transport, Inc., a trucking firm (2000 through 2002). He served as a consultant to KeB from January 2003 through December 2004. Since 1992, Mr. Shisler has also been Chairman of the Board for Nationwide Mutual Insurance Company.3 | 89 | Director of Nationwide Financial Services, Inc., Chairman of Nationwide Mutual Insurance Company3 | ||||||
John H. Grady Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1961 | President & Chief Executive Officer since December 2006 | Mr. Grady is President, and Chief Executive Officer of Nationwide Funds Group which includes Nationwide Fund Advisors,3 Nationwide Fund Management LLC,3 Nationwide Fund Distributors LLC 3 and NWD Investments,2 the asset management operations of Nationwide Mutual Insurance Company, which includes Morley Capital Management, Inc.,2 Nationwide Separate Accounts LLC,2 NorthPointe Capital LLC,2 and Nationwide SA Capital Trust2. From March 2004 until March 2006, Mr. Grady was Chief Executive Officer of Constellation Investment Management Co., L.P. (registered investment adviser), and President and Chief Executive Officer of Constellation Funds Group (registered investment companies). He also was President of Constellation Investment Distribution Co., Inc. (registered broker-dealer) from March 2004 until June 2006. From February 2001 until February 2004, Mr. Grady was Chief Operating and Chief Legal Officer; Managing Director, Mutual Funds Group, Turner Investment Partners, Inc. (registered investment adviser); Executive Vice President of Turner Funds and Turner Institutional Portfolios (registered investment companies); and President, Turner Investment Distributors, Inc. (registered broker-dealer). | N/A | None | ||||||
Gerald J. Holland Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1951 | Treasurer since March 2001 | Mr. Holland is Senior Vice President—Operations for Nationwide Funds Group3. | N/A | N/A | ||||||
Number of Portfolios | ||||||||||
Position(s) Held | in the | |||||||||
with the Trust | Principal Occupation(s) | Nationwide Fund | Other | |||||||
Name, Address | and Length of | During Past | Complex Overseen | Directorships | ||||||
and Year of Birth | Time Served1 | 5 Years | by Trustee | Held by Trustee 2 | ||||||
Michael A. Krulikowski Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1959 | Chief Compliance Officer from June 2004 to August 20074 | Mr. Krulikowski is Vice President and Chief Compliance Officer of Nationwide Funds Group3, Morley Capital Management, Inc.3, Nationwide SA Capital Trust (since 1999)3, and Nationwide Separate Accounts LLC (since August 2005).3 Since June 2004, Mr. Krulikowski has also served as Chief Compliance Officer of the Trust. From November 1999 through May 2007, he served as Vice President and Chief Compliance Officer of NorthPointe Capital LLC. 3 | N/A | N/A | ||||||
Eric E. Miller Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1953 | Secretary since December 2002 | Mr. Miller is Senior Vice President, General Counsel, and Assistant Secretary for Nationwide Funds Group3 and NWD Investments.2 From August 2000 to August 2002, Mr. Miller was a Partner with Stradley Ronon Stevens & Young, LLP. | N/A | N/A | ||||||
1 | Length of time served includes time served with the Trust’s predecessors. | |
2 | Directorships held in (1) any other investment companies registered under the 1940 Act, (2) any company with a class of securities registered pursuant to Section 12 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or (3) any company subject to the requirements of Section 15(d) of the Exchange Act. | |
3 | This position is held with an affiliated person or principal underwriter of the Trust. | |
4 | Effective August 3, 2007, the Board of Trustees approved Carol Baldwin Moody as Chief Compliance Officer of the Trust. Since November 2005, Ms. Moody has been Senior Vice President, Chief Compliance Officer of Nationwide Financial Services, Nationwide Life Insurance Company, Nationwide Life and Annuity Insurance Company, and Nationwide Investment Advisors, LLC. From February 2004-November 2005, she was Chief Compliance Officer of TIAA-CREF and from April 2000-February 2004, she was Managing Director and General Counsel, TCW/ Latin America Partners, LLC and Baeza & Co., LLC. | |
Federal law requires the Trust, each of its investment advisers and sub-advisers to adopt procedures for voting proxies (“Proxy Voting Guidelines”) and to provide a summary of those Proxy Voting Guidelines used to vote the securities held by the Funds. The Funds’ proxy voting policies and procedures are available without charge (i) upon request, by calling 800-848-0920, (ii) on the Funds’ website at www.nationwidefunds.com, or (iii) on the Securities and Exchange Commission’s website at www.sec.gov. |
(i) | General Information Regarding the Board’s Review of Investment Advisory Agreements |
(ii) | Board Conclusions Regarding the Fund’s Advisory Agreement |
Number of Shares | ||||||
Fund | Cast/Not Cast | Percentages | ||||
Federated NVIT High Income Bond Fund (Formerly Federated GVIT High Income Bond Fund) | FOR AGAINST ABSTAIN TOTAL | 30,051,703.188 shares 618,245.021 shares 1,813,550.431 shares 32,483,498.640 shares | 92.514% 1.903% 5.583% | |||
NVIT International Index Fund (Formerly GVIT International Index Fund) | FOR AGAINST ABSTAIN TOTAL | 4,322,203.982 shares 2,758.318 shares 135,636.840 shares 4,460,599.140 shares | 96.897% 0.062% 3.041% | |||
NVIT International Value Fund (Formerly GVIT International Value Fund) | FOR AGAINST ABSTAIN TOTAL | 20,032,843.199 shares 333,588.902 shares 1,093,293.879 shares 21,459,725.980 shares | 93.351% 1.554% 5.095% | |||
NVIT Mid Cap Index Fund (Formerly GVIT Mid Cap Index Fund) | FOR AGAINST ABSTAIN TOTAL | 35,380,179.120 shares 631,117.844 shares 1,565,714.306 shares 37,577,011.270 shares | 94.154% 1.679% 4.167% |
Number of Shares | ||||||
Fund | Cast/Not Cast | Percentages | ||||
NVIT S&P 500 Index Fund (Formerly GVIT S&P 500 Index Fund) | FOR AGAINST ABSTAIN TOTAL | 56,119,814.230 shares 666,195.542 shares 1,944,898.888 shares 58,730,908.660 shares | 95.554% 1.134% 3.312% | |||
Nationwide Multi-Manager NVIT Small Cap Growth Fund (Formerly GVIT Small Cap Growth Fund) | FOR AGAINST ABSTAIN TOTAL | 7,632,918.513 shares 149,458.111 shares 451,583.036 shares 8,233,959.660 shares | 92.700% 1.816% 5.484% | |||
Nationwide Multi-Manager NVIT Small Cap Value Fund (Formerly GVIT Small Cap Value Fund) | FOR AGAINST ABSTAIN TOTAL | 48,649,396.525 shares 979,183.753 shares 2,786,133.102 shares 52,414,713.380 shares | 92.816% 1.868% 5.316% | |||
Nationwide Multi-Manager NVIT Small Company Fund (Formerly GVIT Small Company Fund) | FOR AGAINST ABSTAIN TOTAL | 29,903,181.700 shares 838,774.923 shares 2,006,741.307 shares 32,748,697.930 shares | 91.311% 2.561% 6.128% | |||
Gartmore NVIT Developing Markets Fund (Formerly Gartmore GVIT Developing Markets Fund) | FOR AGAINST ABSTAIN TOTAL | 21,0177,889.443 shares 424,272.958 shares 1,543,850.729 shares 23,046,013.130 shares | 91.460% 1.841% 6.699% | |||
Gartmore NVIT Emerging Markets Fund (Formerly Gartmore GVIT Emerging Markets Fund) | FOR AGAINST ABSTAIN TOTAL | 17,050,534.593 shares 526,574.722 shares 881,608.905 shares 18,458,718.220 shares | 92.371% 2.853% 4.776% | |||
Nationwide NVIT Global Financial Services Fund (Formerly Gartmore GVIT Global Financial Services Fund) | FOR AGAINST ABSTAIN TOTAL | 1,554,847.333 shares 19,539.033 shares 52,206.494 shares 1,626,592.860 shares | 95.589% 1.201% 3.210% | |||
Nationwide NVIT Global Health Sciences Fund (Formerly Gartmore GVIT Global Health Sciences Fund) | FOR AGAINST ABSTAIN TOTAL | 4,722,963.678 shares 157,979.030 shares 207,642.222 shares 5,088,584.930 shares | 92.815% 3.104% 4.081% | |||
Nationwide NVIT Global Technology and Communications Fund (Formerly Gartmore GVIT Global Technology and Communications Fund) | FOR AGAINST ABSTAIN TOTAL | 8,585,472.039 shares 102,267.977 shares 489,577.634 shares 9,177,317.650 shares | 93.551% 1.114% 5.335% | |||
Gartmore NVIT Global Utilities Fund (Formerly Gartmore GVIT Global Utilities Fund) | FOR AGAINST ABSTAIN TOTAL | 4,123,270.549 shares 122,001.533 shares 240,276.088 shares 4,485,548.170 shares | 91.923% 2.720% 5.357% | |||
Nationwide NVIT Government Bond Fund (Formerly Gartmore GVIT Government Bond Fund) | FOR AGAINST ABSTAIN TOTAL | 88,471,567.462 shares 1,825,645.181 shares 5,841,990.727 shares 96,139,203.370 shares | 92.024% 1.899% 6.077% |
Number of Shares | ||||||
Fund | Cast/Not Cast | Percentages | ||||
Nationwide NVIT Growth Fund (Formerly Gartmore GVIT Growth Fund) | FOR AGAINST ABSTAIN TOTAL | 14,931,435.904 shares 409,826.402 shares 1,259,945.064 shares 16,601,207.370 shares | 89.942% 2.469% 7.589% | |||
Gartmore NVIT International Growth Fund (Formerly Gartmore GVIT International Growth Fund) | FOR AGAINST ABSTAIN TOTAL | 6,251,419.070 shares 139,618.548 shares 290,025.592 shares 6,681,063.210 shares | 93.569% 2.090% 4.341% | |||
Nationwide NVIT Investor Destinations Aggressive Fund (Formerly Gartmore GVIT Investor Destinations Aggressive Fund) | FOR AGAINST ABSTAIN TOTAL | 49,489,224.549 shares 1,385,396.474 shares 3,696,272.337 shares 54,570,893.360 shares | 90.688% 2.539% 6.773% | |||
Nationwide NVIT Investor Destinations Conservative Fund (Formerly Gartmore GVIT Investor Destinations Conservative Fund) | FOR AGAINST ABSTAIN TOTAL | 23,091,965.887 shares 314,935,884 shares 2,292,355.179 shares 25,699,256.950 shares | 89.855% 1.225% 8.920% | |||
Nationwide NVIT Investor Destinations Moderate Fund (Formerly Gartmore GVIT Investor Destinations Moderate Fund) | FOR AGAINST ABSTAIN TOTAL | 188,902,093.059 shares 3,018,924.590 shares 16,359,690.401 shares 208,280,708.050 shares | 90.696% 1.449% 7.855% | |||
Nationwide NVIT Investor Destinations Moderately Aggressive Fund (Formerly Gartmore GVIT Investor Destinations Moderately Aggressive Fund) | FOR AGAINST ABSTAIN TOTAL | 134,792,622.920 shares 3,489,207.264 shares 9,304,197.656 shares 147,586,027.840 shares | 91.332% 2.364% 6.304% | |||
Nationwide NVIT Investor Destinations Moderately Conservative Fund (Formerly Gartmore GVIT Investor Destinations Moderately Conservative Fund) | FOR AGAINST ABSTAIN TOTAL | 49,627,123.216 shares 856,088.634 shares 3,507,215.650 shares 53,990,427.500 shares | 91.918% 1.586% 6.496% | |||
Nationwide NVIT Mid Cap Growth Fund (Formerly Gartmore GVIT Mid Cap Growth Fund) | FOR AGAINST ABSTAIN TOTAL | 10,879,584.971 shares 352,594.958 shares 717,792.971 shares 11,949,972.900 shares | 91.043% 2.950% 6.007% | |||
Nationwide NVIT Money Market Fund II (Formerly Gartmore GVIT Money Market Fund II) | FOR AGAINST ABSTAIN TOTAL | 221,774,863.241 shares 12,322,482.494 shares 16,471,740.875 shares 250,569,086.610 shares | 88.508% 4.918% 6.574% | |||
Nationwide NVIT Money Market Fund (Formerly Gartmore GVIT Money Market Fund) | FOR AGAINST ABSTAIN TOTAL | 1,578,331,008.328 shares 32,372,133.671 shares 112,652,123.301 shares 1,723,355,265.300 shares | 91.585% 1.878% 6.537% | |||
NVIT Nationwide Fund (Formerly Gartmore GVIT Nationwide Fund) | FOR AGAINST ABSTAIN TOTAL | 125,423,274.735 shares 2,767,979.467 shares 8,762,255.828 shares 136,953,510.030 shares | 91.581% 2.021% 6.398% |
Number of Shares | ||||||
Fund | Cast/Not Cast | Percentages | ||||
NVIT Nationwide Leaders Fund (Formerly Gartmore GVIT Nationwide Leaders Fund) | FOR AGAINST ABSTAIN TOTAL | 2,298,504.956 shares 29,630.469 shares 71,637.755 shares 2,399,773.180 shares | 95.780% 1.235% 2.985% | |||
Nationwide NVIT U.S. Growth Leaders Fund (Formerly Gartmore GVIT U.S. Growth Leaders Fund) | FOR AGAINST ABSTAIN TOTAL | 4,972,094.773 shares 122,623.161 shares 174,625.606 shares 5,269,343.540 shares | 94.359% 2.327% 3.314% | |||
Gartmore NVIT Worldwide Leaders Fund (Formerly Gartmore GVIT Worldwide Leaders Fund) | FOR AGAINST ABSTAIN TOTAL | 2,666,862.487 shares 47,702.491 shares 118,719.882 shares 2,833,284.860 shares | 94.126% 1.684% 4.190% | |||
JP Morgan NVIT Balanced Fund (Formerly JP Morgan GVIT Balanced Fund) | FOR AGAINST ABSTAIN TOTAL | 15,966,867.546 shares 259,004.324 shares 1,339,385.200 shares 17,565,257.070 shares | 90.900% 1.475% 7.625% | |||
Van Kampen NVIT Comstock Value Fund (Formerly Van Kampen GVIT Comstock Value Fund) | FOR AGAINST ABSTAIN TOTAL | 27,737,008.009 shares 502,564.164 shares 1,824,670.107 shares 30,064,242.280 shares | 92.259% 1.672% 6.069% | |||
Van Kampen NVIT Multi Sector Bond Fund (Formerly Van Kampen GVIT Multi Sector Bond Fund) | FOR AGAINST ABSTAIN TOTAL | 21,253,297.665 shares 484,100.920 shares 1,803,963.645 shares 23,541,362.230 shares | 90.281% 2.056% 7.663% | |||
Number of Shares | ||||||
Fund | Cast/Not Cast | Percentages | ||||
Nationwide NVIT Mid Cap Growth Fund (Formerly Gartmore GVIT Mid Cap Growth Fund) | FOR AGAINST ABSTAIN TOTAL | 10,862,827.499 shares 414,574.660 shares 672,570.741 shares 11,949,972.900 shares | 90.903% 3.469% 5.628% | |||
* | This meeting was previously adjourned on April 23, 2007. | |
** | Fund names were changed effective May 1, 2007 to reflect “Nationwide”/“NVIT” branding to coincide with the sale of Nationwide Fund Advisors, Inc. by Nationwide Corporation to its majority-owned subsidiary, Nationwide Financial Services, Inc. |
Contents | ||
6 | Statement of Investments | |
11 | Statement of Assets and Liabilities | |
13 | Statement of Operations | |
14 | Statements of Changes in Net Assets | |
16 | Financial Highlights | |
18 | Notes to Financial Statements |
SAR-IV (8/07) | ![]() |
![-s- John H. Grady](https://capedge.com/proxy/N-CSRS/0000893220-07-003038/w37711gradyjh.gif)
Beginning | Ending | |||||||||||||||||||||
Account Value, | Account Value | Expenses Paid | Annualized | |||||||||||||||||||
NVIT International Value Fund | January 1, 2007 | June 30, 2007 | During Period* | Expense Ratio* | ||||||||||||||||||
Class I | Actual | $ | 1,000.00 | $ | 1,077.50 | $ | 5.20 | 1.01% | ||||||||||||||
Hypothetical | 1 | $ | 1,000.00 | $ | 1,019.79 | $ | 5.07 | 1.01% | ||||||||||||||
Class II | Actual | $ | 1,000.00 | $ | 1,076.60 | $ | 6.49 | 1.26% | ||||||||||||||
Hypothetical | 1 | $ | 1,000.00 | $ | 1,018.55 | $ | 6.33 | 1.26% | ||||||||||||||
Class III | Actual | $ | 1,000.00 | $ | 1,077.20 | $ | 5.20 | 1.01% | ||||||||||||||
Hypothetical | 1 | $ | 1,000.00 | $ | 1,019.79 | $ | 5.07 | 1.01% | ||||||||||||||
Class IV | Actual | $ | 1,000.00 | $ | 1,077.60 | $ | 5.10 | 0.99% | ||||||||||||||
Hypothetical | 1 | $ | 1,000.00 | $ | 1,019.89 | $ | 4.97 | 0.99% | ||||||||||||||
Class VI | Actual | $ | 1,000.00 | $ | 1,075.90 | $ | 6.49 | 1.26% | ||||||||||||||
Hypothetical | 1 | $ | 1,000.00 | $ | 1,018.55 | $ | 6.33 | 1.26% | ||||||||||||||
* | Expenses are equal to the Fund’s annualized expense ratio multiplied by the average account value over the period multiplied by 181/365 (to reflect the one-half year period). The expense ratio presented represents a six-month, annualized ratio in accordance with SEC guidelines. The expenses reported above do not include the effect of additional expenses imposed by variable annuity contracts. | |
1 | Represents the hypothetical 5% return before expenses. |
Asset Allocation | ||||
Common Stock | 95.6% | |||
Repurchase Agreements | 3.4% | |||
Rights | 0.0% | |||
Other Investments* | 16.8% | |||
Liabilities in excess of other assets** | -15.8% | |||
100.0% |
Top Holdings*** | ||||
Unilever PLC | 2.4% | |||
BP PLC | 2.3% | |||
Novartis AG | 2.3% | |||
Sanofi-Aventis | 2.2% | |||
HSBC Holdings PLC | 2.1% | |||
Royal Bank of Scotland Group PLC | 2.0% | |||
Total SA | 1.8% | |||
Sumitomo Mitsui Financial Group, Inc. | 1.7% | |||
GlaxoSmithKline PLC | 1.7% | |||
Deutsche Post AG | 1.7% | |||
Other | 79.8% | |||
100.0% |
Top Industries | ||||
Commercial Banks | 16.4% | |||
Oil, Gas & Consumable Fuels | 8.4% | |||
Pharmaceuticals | 7.6% | |||
Insurance | 5.9% | |||
Diversified Telecommunication Services | 3.9% | |||
Media | 3.7% | |||
Food Products | 3.6% | |||
Automobiles | 3.2% | |||
Household Durables | 3.0% | |||
Food & Staples Retailing | 2.9% | |||
Other | 41.4% | |||
100.0% |
Top Countries | ||||
United Kingdom | 23.2% | |||
Japan | 22.9% | |||
Germany | 9.4% | |||
France | 8.9% | |||
Switzerland | 6.6% | |||
Italy | 4.8% | |||
United States | 3.4% | |||
Australia | 3.4% | |||
Republic of Korea | 2.4% | |||
Hong Kong | 1.9% | |||
Other | 13.1% | |||
100.0% |
* | Includes value of collateral received from securities lending. |
** | Includes value of collateral owed from securities lending. |
*** | For purpose of listing top holdings, repurchase agreements are included as part of Other. |
Common Stock (95.6%) | ||||||||
Shares or | ||||||||
Principal Amount | Value | |||||||
AUSTRALIA (3.4%) (a) | ||||||||
Commercial Bank (0.8%) (b) | ||||||||
National Australia Bank Ltd. | 113,096 | $ | 3,929,450 | |||||
Containers & Packaging (0.9%) | ||||||||
AmCor Ltd. | 659,895 | 4,177,736 | ||||||
Diversified Financial Services (0.6%) (b) | ||||||||
SunCorp-Metway Ltd. | 156,075 | 2,665,010 | ||||||
Diversified Telecommunication Services (0.2%) | ||||||||
Telstra Corp. Ltd. | 284,730 | 1,107,516 | ||||||
Hotels, Restaurants & Leisure (0.7%) (b) | ||||||||
Tabcorp Holdings Ltd. | 228,575 | 3,320,347 | ||||||
Insurance (0.2%) (b) | ||||||||
Insurance Australia Group Ltd. | 233,409 | 1,125,594 | ||||||
16,325,653 | ||||||||
BELGIUM (0.9%) (a) (b) | ||||||||
Diversified Financial Services (0.9%) | ||||||||
Fortis NV | 98,390 | 4,173,663 | ||||||
BRAZIL (0.9%) | ||||||||
Oil, Gas & Consumable Fuels (0.4%) | ||||||||
Petroleo Brasileiro SA ADR | 15,060 | 1,826,326 | ||||||
Telephones (0.5%) | ||||||||
Tele Norte Leste Participacoes SA | 139,000 | 2,636,830 | ||||||
4,463,156 | ||||||||
FINLAND (1.6%) (a) | ||||||||
Communications Equipment (0.7%) | ||||||||
Nokia OYJ | 116,180 | 3,262,595 | ||||||
Paper & Forest Products (0.9%) | ||||||||
M-Real OYJ, B Shares | 34,600 | 225,738 | ||||||
UPM-Kymmene OYJ | 160,579 | 3,951,459 | ||||||
4,177,197 | ||||||||
7,439,792 | ||||||||
FRANCE (8.9%) | ||||||||
Automobiles (0.5%) (a) (b) | ||||||||
Peugeot SA | 28,280 | 2,278,010 | ||||||
Commercial Banks (2.1%) (a) (b) | ||||||||
BNP Paribas | 30,070 | 3,571,437 | ||||||
Credit Agricole SA | 155,970 | 6,328,269 | ||||||
9,899,706 | ||||||||
Diversified Telecommunication Services (0.7%) (a) | ||||||||
France Telecom SA | 130,480 | 3,578,213 | ||||||
Household Durables (0.7%) | ||||||||
Thomson | 168,610 | 3,224,201 | ||||||
Media (0.6%) (a) (b) | ||||||||
Lagardere SA | 32,560 | 2,823,579 | ||||||
Oil, Gas & Consumable Fuels (2.1%) | ||||||||
Total SA (a) | 107,960 | 8,752,258 | ||||||
Total SA ADR - FR | 15,392 | 1,246,444 | ||||||
9,998,702 | ||||||||
Pharmaceutical (2.2%) (a) (b) | ||||||||
Sanofi-Aventis | 131,220 | 10,599,762 | ||||||
42,402,173 | ||||||||
GERMANY (9.4%) (a) | ||||||||
Air Freight & Logistics (1.7%) | ||||||||
Deutsche Post AG | 245,630 | 7,950,435 | ||||||
Automobiles (0.7%) | ||||||||
Bayerische Motoren Werke AG | 53,710 | 3,456,292 | ||||||
Diversified Telecommunication Services (1.1%) (b) | ||||||||
Deutsche Telekom AG | 293,470 | 5,404,400 | ||||||
Electric Utility (1.1%) | ||||||||
E. On AG | 29,837 | 4,981,125 | ||||||
Household Products (0.5%) (b) | ||||||||
Henkel KGaA | 47,190 | 2,486,444 | ||||||
Industrial Conglomerate (1.2%) | ||||||||
Siemens AG | 38,490 | 5,511,236 | ||||||
Insurance (1.9%) | ||||||||
Allianz AG | 17,140 | 3,996,570 | ||||||
Hannover Rueckversicherung AG (b) | 21,730 | 1,052,110 | ||||||
Muenchener Rueckversicherungs AG | 22,190 | 4,069,008 | ||||||
9,117,688 | ||||||||
Machinery (0.4%) (b) | ||||||||
Heidelberger Druckmaschinen | 41,410 | 1,997,370 | ||||||
Textiles, Apparel & Luxury Goods (0.8%) (b) | ||||||||
Adidas AG | 59,890 | 3,818,890 | ||||||
44,723,880 | ||||||||
GREECE (0.9%) (a) | ||||||||
Electric Utility (0.9%) | ||||||||
Public Power Corp. | 155,760 | 4,389,312 | ||||||
Common Stock (continued) | ||||||||
Shares or | ||||||||
Principal Amount | Value | |||||||
HONG KONG (1.9%) (a) | ||||||||
Commercial Bank (0.6%) (b) | ||||||||
BOC Hong Kong Holdings Ltd. | 1,280,400 | $ | 3,048,598 | |||||
Electric Utility (0.1%) | ||||||||
Hong Kong Electric Holdings | 74,000 | 373,295 | ||||||
Electrical Equipment (0.3%) (b) | ||||||||
Johnson Electric Holdings Ltd. | 2,419,000 | 1,343,419 | ||||||
Industrial Conglomerate (0.9%) | ||||||||
Hutchison Whampoa Ltd. | 437,600 | 4,344,242 | ||||||
9,109,554 | ||||||||
IRELAND (0.3%) (a) | ||||||||
Commercial Bank (0.3%) | ||||||||
Bank of Ireland | 78,255 | 1,576,421 | ||||||
ISRAEL (0.6%) | ||||||||
Pharmaceutical (0.6%) | ||||||||
Teva Pharmaceutical Industries Ltd. ADR - IL | 72,330 | 2,983,613 | ||||||
ITALY (4.8%) (a) | ||||||||
Commercial Bank (0.9%) | ||||||||
UniCredito Italiano SPA | 494,520 | 4,416,379 | ||||||
Diversified Telecommunication Services (1.0%) | ||||||||
Telecom Italia SPA | 1,685,700 | 4,614,608 | ||||||
Insurance (0.7%) | ||||||||
Unipol SPA | 921,390 | 3,316,131 | ||||||
Media (0.9%) (b) | ||||||||
Mediaset SPA | 430,190 | 4,443,336 | ||||||
Oil, Gas & Consumable Fuels (1.3%) (b) | ||||||||
Eni SPA | 97,980 | 3,552,117 | ||||||
Saras SPA | 411,610 | 2,623,515 | ||||||
6,175,632 | ||||||||
22,966,086 | ||||||||
JAPAN (22.9%) (a) | ||||||||
Auto Components (0.8%) | ||||||||
NGK Spark Plug Co. Ltd. | 37,000 | 642,774 | ||||||
NOK Corp. (b) | 154,400 | 3,259,243 | ||||||
3,902,017 | ||||||||
Automobiles (1.5%) | ||||||||
Nissan Motor Co. Ltd. | 495,700 | 5,307,559 | ||||||
Toyota Motor Corp. | 29,700 | 1,873,300 | ||||||
7,180,859 | ||||||||
Building Products (0.6%) | ||||||||
JS Group Corp. | 133,100 | 2,698,802 | ||||||
Capital Markets (0.9%) (b) | ||||||||
Nomura Holdings, Inc. | 227,800 | 4,425,181 | ||||||
Chemicals (1.3%) | ||||||||
Kuraray Co. Ltd. (b) | 148,700 | 1,743,264 | ||||||
Sumitomo Chemical Co. Ltd. | 246,100 | 1,651,633 | ||||||
Teijin Ltd. | 491,200 | 2,686,928 | ||||||
6,081,825 | ||||||||
Commercial Banks (4.3%) | ||||||||
77 Bank Ltd. (The) (b) | 360,200 | 2,337,991 | ||||||
Mitsubishi UFJ Financial Group, Inc. | 592 | 6,525,042 | ||||||
Mitsui Trust Holdings, Inc. | 181,400 | 1,578,463 | ||||||
Shinsei Bank Ltd. | 499,300 | 2,018,182 | ||||||
Sumitomo Mitsui Financial Group, Inc. | 882 | 8,223,365 | ||||||
20,683,043 | ||||||||
Consumer Finance (0.8%) (b) | ||||||||
Credit Saison Co. Ltd. | 104,900 | 2,730,621 | ||||||
Shohkoh Fund & Co. Ltd. | 6,816 | 1,142,101 | ||||||
3,872,722 | ||||||||
Food & Staples Retailing (2.9%) | ||||||||
AEON Mall Co. Ltd. | 322,900 | 5,994,318 | ||||||
Lawson, Inc. (b) | 32,500 | 1,124,267 | ||||||
Matsumotokiyoshi Co. Ltd. (b) | 92,437 | 2,029,784 | ||||||
Seven & I Holdings Co. Ltd. | 169,500 | 4,845,812 | ||||||
13,994,181 | ||||||||
Household Durables (1.8%) | ||||||||
Funai Electric Co. Ltd. (b) | 9,900 | 577,067 | ||||||
Sekisui Chemical Co. Ltd. | 491,200 | 3,796,733 | ||||||
Sekisui House Ltd. | 315,300 | 4,203,315 | ||||||
8,577,115 | ||||||||
Household Products (0.1%) | ||||||||
Kao Corp. | 13,000 | 336,629 | ||||||
Machinery (1.7%) | ||||||||
Hino Motors Ltd. (b) | 590,400 | 3,529,997 | ||||||
Kubota Corp. | 296,500 | 2,397,015 | ||||||
THK Co. Ltd. | 81,600 | 2,043,761 | ||||||
7,970,773 | ||||||||
Media (0.9%) (b) | ||||||||
Dentsu, Inc. | 1,542 | 4,371,996 | ||||||
Common Stock (continued) | ||||||||
Shares or | ||||||||
Principal Amount | Value | |||||||
JAPAN (continued) | ||||||||
Office Electronics (1.2%) | ||||||||
Canon, Inc. (b) | 47,908 | $ | 2,809,813 | |||||
Ricoh Co. Ltd. | 118,900 | 2,751,249 | ||||||
5,561,062 | ||||||||
Paper & Forest Products (0.6%) | ||||||||
Nippon Paper Group, Inc. | 791 | 2,634,155 | ||||||
Pharmaceuticals (0.8%) | ||||||||
Astellas Pharma, Inc. | 34,000 | 1,479,091 | ||||||
Takeda Pharmaceutical Co. Ltd. | 38,400 | 2,480,998 | ||||||
3,960,089 | ||||||||
Road & Rail (1.0%) | ||||||||
Central Japan Railway Co. | 8 | 84,415 | ||||||
Nippon Express Co. Ltd. | 827,600 | 4,705,127 | ||||||
4,789,542 | ||||||||
Semiconductors & Semiconductor Equipment (1.2%) | ||||||||
Rohm Co. Ltd. | 66,600 | 5,911,172 | ||||||
Trading Companies & Distributors (0.5%) | ||||||||
Mitsubishi Corp. | 98,900 | 2,591,697 | ||||||
109,542,860 | ||||||||
MALAYSIA (0.5%) (a) | ||||||||
Commercial Bank (0.5%) | ||||||||
Malayan Banking Berhad | 746,200 | 2,595,004 | ||||||
MEXICO (0.4%) | ||||||||
Beverages (0.4%) | ||||||||
Coca-Cola Femsa SA de CV ADR - MX | 44,710 | 1,979,759 | ||||||
NETHERLANDS (1.3%) (a) | ||||||||
Household Durables (0.5%) | ||||||||
Koninklijke Philips Electronics NV | 58,530 | 2,480,055 | ||||||
Insurance (0.8%) | ||||||||
Aegon NV | 186,558 | 3,671,440 | ||||||
6,151,495 | ||||||||
REPUBLIC OF KOREA (2.4%) | ||||||||
Automobiles (0.5%) (a) | ||||||||
Hyundai Motor Co. Ltd. | 30,960 | 2,443,860 | ||||||
Diversified Telecommunication Services (0.9%) | ||||||||
KT Corp. Sponsored ADR - KR | 98,810 | 2,318,083 | ||||||
SK Telecom Co. Ltd. ADR - KR | 81,790 | 2,236,956 | ||||||
4,555,039 | ||||||||
Electric Utility (0.4%) | ||||||||
Korea Electric Power Corp. ADR - KR | 81,780 | 1,790,982 | ||||||
Semiconductors & Semiconductor Equipment (0.6%) (a) | ||||||||
Samsung Electrical Co. Ltd. | 4,654 | 2,846,313 | ||||||
11,636,194 | ||||||||
SINGAPORE (1.1%) (a) | ||||||||
Commercial Banks (1.1%) | ||||||||
DBS Group Holdings Ltd. | 334,240 | 4,981,163 | ||||||
United Overseas Bank Ltd. | 8,800 | 126,534 | ||||||
5,107,697 | ||||||||
SOUTH AFRICA (0.4%) (a) | ||||||||
Commercial Bank (0.4%) | ||||||||
Nedcor Ltd. | 109,207 | 2,036,027 | ||||||
SPAIN (1.1%) | ||||||||
Commercial Bank (0.6%) (a) | ||||||||
Banco Santander Central Hispano SA | 169,662 | 3,118,387 | ||||||
Oil, Gas & Consumable Fuels (0.5%) (b) | ||||||||
Repsol YPF SA | 56,020 | 2,217,510 | ||||||
5,335,897 | ||||||||
SWEDEN (1.0%) | ||||||||
Communications Equipment (0.9%) | ||||||||
Telefonaktiebolaget LM Ericsson, B Shares (a) | 904,500 | 3,609,115 | ||||||
Telefonaktiebolaget LM Ericsson ADR - SE | 10,790 | 430,413 | ||||||
4,039,528 | ||||||||
Paper & Forest Products (0.1%) (a) | ||||||||
Svenska Cellusoa AB, B Shares | 29,550 | 494,322 | ||||||
4,533,850 | ||||||||
SWITZERLAND (6.6%) (a) | ||||||||
Capital Markets (1.1%) | ||||||||
UBS AG | 89,400 | 5,347,819 | ||||||
Chemicals (1.6%) | ||||||||
Ciba Specialty Chemicals AG | 95,148 | 6,183,791 | ||||||
Clariant AG | 95,210 | 1,541,536 | ||||||
7,725,327 | ||||||||
Food Products (1.2%) | ||||||||
Nestle SA | 14,273 | 5,424,695 | ||||||
Common Stock (continued) | ||||||||
Shares or | ||||||||
Principal Amount | Value | |||||||
SWITZERLAND (continued) | ||||||||
Insurance (0.4%) (b) | ||||||||
Swiss Reinsurance | 22,217 | $ | 2,026,691 | |||||
Pharmaceutical (2.3%) | ||||||||
Novartis AG | 192,780 | 10,825,441 | ||||||
31,349,973 | ||||||||
TAIWAN (1.1%) | ||||||||
Computers & Peripherals (0.5%) (a) | ||||||||
Compal Electronics, Inc. | 2,415,000 | 2,606,704 | ||||||
Semiconductors & Semiconductor Equipment (0.6%) | ||||||||
United MicroElectrical Components & Equipment Corp. ADR - TW | 786,371 | 2,689,389 | ||||||
5,296,093 | ||||||||
UNITED KINGDOM (23.2%) (a) | ||||||||
Beverages (0.8%) | ||||||||
SABMiller PLC | 149,600 | 3,787,236 | ||||||
Commercial Banks (4.8%) | ||||||||
HBOS PLC | 172,174 | 3,386,205 | ||||||
HSBC Holdings PLC | 548,483 | 10,041,985 | ||||||
Royal Bank of Scotland Group PLC | 765,988 | 9,691,445 | ||||||
23,119,635 | ||||||||
Commercial Services & Supplies (1.0%) | ||||||||
Rentokil Initial PLC | 1,500,610 | 4,815,860 | ||||||
Containers & Packaging (0.7%) | ||||||||
Rexam PLC | 319,615 | 3,182,875 | ||||||
Electric Power (0.6%) | ||||||||
British Energy PLC | 248,645 | 2,682,083 | ||||||
Food Products (2.4%) | ||||||||
Unilever PLC | 346,969 | 11,202,454 | ||||||
Industrial Conglomerate (0.4%) | ||||||||
Smiths Group PLC | 82,600 | 1,958,722 | ||||||
Insurance (1.9%) | ||||||||
Friends Provident PLC | 1,194,402 | 4,275,061 | ||||||
Old Mutual PLC | 1,476,410 | 4,974,609 | ||||||
9,249,670 | ||||||||
Media (1.3%) | ||||||||
Reed Elsevier PLC | 272,900 | 3,526,588 | ||||||
Trinity Mirror PLC | 190,960 | 2,012,888 | ||||||
WPP Group PLC | 32,500 | 486,037 | ||||||
6,025,513 | ||||||||
Metals & Mining (0.9%) | ||||||||
BHP Billiton PLC | 162,240 | 4,506,388 | ||||||
Multi-Utility (0.5%) | ||||||||
Centrica PLC | 289,820 | 2,251,467 | ||||||
Multiline Retail (0.5%) | ||||||||
Debenhams PLC | 988,080 | 2,561,324 | ||||||
Oil, Gas & Consumable Fuels (4.1%) | ||||||||
BP PLC | 927,293 | 11,156,361 | ||||||
Royal Dutch Shell PLC | 46,344 | 1,886,518 | ||||||
Royal Dutch Shell PLC, A Shares (b) | 158,848 | 6,464,140 | ||||||
19,507,019 | ||||||||
Pharmaceutical (1.7%) | ||||||||
GlaxoSmithKline PLC | 307,378 | 8,006,393 | ||||||
Wireless Telecommunication Services (1.6%) | ||||||||
Vodafone Group PLC | 2,341,987 | 7,846,769 | ||||||
110,703,408 | ||||||||
Total Common Stocks (Cost $409,476,786) | 456,821,560 | |||||||
Repurchase Agreements (3.4%) | ||||||||
Nomura Securities, 5.20%, dated 06/29/07, due 07/02/07, repurchase price $16,381,470, collateralized by various U.S. Government Agency Mortgages with a market value of $16,701,862 | $ | 16,374,375 | 16,374,375 | |||||
Rights (0.0%) | ||||||||
ITALY (0.0%) | ||||||||
Unipol SPA Rights | 878,490 | 0 | ||||||
Common Stock (continued) | ||||||||
Shares or | ||||||||
Principal Amount | Value | |||||||
UNITED KINGDOM (continued) | ||||||||
Wireless Telecommunication Services (continued) |
Securities Held As Collateral for Securities on Loan (16.8%) | |||||||||
Shares or | |||||||||
Principal Amount | Value | ||||||||
Morgan Stanley Repurchase Agreement, | |||||||||
5.42%, dated 06/29/07, due 07/02/07, repurchase price $80,370,407, collateralized by U.S. Government Agency Mortgages with a market value of $81,940,805 | $ | 80,334,123 | $ | 80,334,123 | |||||
Total Investments (Cost $506,185,284) (c) — 115.8% | 553,530,058 | ||||||||
Liabilities in excess of other assets — (15.8)% | (75,629,706 | ) | |||||||
NET ASSETS — 100.0% | $ | 477,900,352 | |||||||
(a) | Fair Valued Security. | |
(b) | All or a part of the security was on loan as of June 30, 2007. | |
(c) | See notes to financial statements for tax unrealized appreciation (depreciation) of securities. |
ADR | American Depository Receipt | |
FR | France | |
IL | Israel | |
KR | Korea | |
MX | Mexico | |
SE | Sweden | |
TW | Taiwan |
Unrealized | ||||||||||||||||||
Delivery | Contract | Market | Appreciation/ | |||||||||||||||
Currency | Date | Value | Value | (Depreciation) | ||||||||||||||
Short Contracts: | ||||||||||||||||||
Euro | 07/03/07 | 514,467 | 515,286 | (819 | ) | |||||||||||||
Total Short Contracts | $ | 514,467 | $ | 515,286 | $ | (819 | ) | |||||||||||
Unrealized | ||||||||||||||||||
Delivery | Contract | Market | Appreciation/ | |||||||||||||||
Currency | Date | Value | Value | (Depreciation) | ||||||||||||||
Long Contracts: | ||||||||||||||||||
British Pound | 07/02/07 | 378,877 | 379,995 | 1,118 | ||||||||||||||
Japanese Yen | 07/02/07 | 465,618 | 465,278 | (340 | ) | |||||||||||||
Japanese Yen | 07/03/07 | 160,765 | 161,327 | 562 | ||||||||||||||
Total Long Contracts | $ | 1,005,260 | $ | 1,006,600 | $ | 1,340 | ||||||||||||
NVIT Nationwide | ||||||
Value Fund | ||||||
Assets: | ||||||
Investments, at value (cost $409,476,786)* | $ | 456,821,560 | ||||
Repurchase agreements, at cost and value | 96,708,498 | |||||
Total Investments | 553,530,058 | |||||
Foreign currencies, at value (cost $4,007,477) | 4,032,036 | |||||
Interest and dividends receivable | 805,816 | |||||
Receivable for capital shares issued | 497,129 | |||||
Receivable for investments sold | 1,717,027 | |||||
Unrealized appreciation on forward foreign currency contracts | 1,680 | |||||
Reclaims receivable | 188,884 | |||||
Prepaid expenses | 4,616 | |||||
Total Assets | 560,777,246 | |||||
Liabilities: | ||||||
Payable to custodian | 211,316 | |||||
Payable for investments purchased | 1,734,019 | |||||
Unrealized depreciation on forward foreign currency contracts | 1,159 | |||||
Payable upon return of securities loaned | 80,334,123 | |||||
Payable for capital shares redeemed | 132,787 | |||||
Accrued expenses and other payables: | ||||||
Investment advisory fees | 291,087 | |||||
Fund administration and transfer agent fees | 32,014 | |||||
Distribution fees | 46,149 | |||||
Administrative servicing fees | 56,275 | |||||
Compliance program costs | 4,907 | |||||
Other | 33,058 | |||||
Total Liabilities | 82,876,894 | |||||
Net Assets | $ | 477,900,352 | ||||
Represented by: | ||||||
Capital | $ | 408,443,395 | ||||
Accumulated net investment income | 2,887,087 | |||||
Accumulated net realized gains from investment transactions and foreign currency transactions | 19,185,209 | |||||
Net unrealized appreciation on investments and translation of assets and liabilities denominated in foreign currencies | 47,384,661 | |||||
Net Assets | $ | 477,900,352 | ||||
Net Assets: | ||||||
Class I Shares | $ | 3,602,606 | ||||
Class II Shares | 2,891,610 | |||||
Class III Shares | 175,782,150 | |||||
Class IV Shares | 66,785,910 | |||||
Class VI Shares | 228,838,076 | |||||
Total | $ | 477,900,352 | ||||
NVIT Nationwide | ||||
Value Fund | ||||
Shares outstanding (unlimited number of shares authorized): | ||||
Class I Shares | 194,654 | |||
Class II Shares | 156,931 | |||
Class III Shares | 9,526,804 | |||
Class IV Shares | 3,609,071 | |||
Class VI Shares | 12,440,483 | |||
Total | 25,927,943 | |||
Net asset value and offering price per share (Net assets by class divided by shares outstanding by class, respectively.): | ||||
Class I Shares | $ | 18.51 | ||
Class II Shares | $ | 18.43 | ||
Class III Shares | $ | 18.45 | ||
Class IV Shares | $ | 18.51 | ||
Class VI Shares | $ | 18.39 |
* | Includes value of securities on loan of $76,697,581. |
NVIT International | |||||
Value Fund | |||||
INVESTMENT INCOME: | |||||
Interest income | $ | 410,927 | |||
Dividend income | 8,556,687 | ||||
Income from securities lending | 240,059 | ||||
Total Income | 9,207,673 | ||||
Expenses: | |||||
Investment advisory fees | 1,624,286 | ||||
Fund administration and transfer agent fees | 146,390 | ||||
Distribution fees Class II Shares | 3,643 | ||||
Distribution fees Class VI Shares | 232,050 | ||||
Administrative servicing fees Class I Shares | 2,812 | ||||
Administrative servicing fees Class II Shares | 2,296 | ||||
Administrative servicing fees Class III Shares | 133,724 | ||||
Administrative servicing fees Class IV Shares | 44,289 | ||||
Administrative servicing fees Class VI Shares | 143,736 | ||||
Custodian fees | 8,758 | ||||
Trustee fees | 9,388 | ||||
Compliance program costs (Note 3) | 2,857 | ||||
Other | 51,960 | ||||
Total expenses before earnings credit | 2,406,189 | ||||
Earnings credit (Note 6) | (118 | ) | |||
Net Expenses | 2,406,071 | ||||
Net Investment Income | 6,801,602 | ||||
REALIZED/ UNREALIZED GAINS (LOSSES) FROM INVESTMENTS: | |||||
Net realized gains on investment transactions | 25,100,224 | ||||
Net realized gains on foreign currency transactions | 176,777 | ||||
Net realized gains on investment transactions and foreign currency transactions | 25,277,001 | ||||
Net change in unrealized appreciation on investments and translation of assets and liabilities denominated in foreign currencies | 346,460 | ||||
Net realized/unrealized gains (losses) on investments and translation of assets and liabilities denominated in foreign currencies | 25,623,461 | ||||
CHANGE IN NET ASSETS RESULTING FROM OPERATIONS | $ | 32,425,063 | |||
NVIT International | |||||||||
Value Fund | |||||||||
Six Months Ended | Year Ended | ||||||||
June 30, 2007 | December 31, 2006 | ||||||||
From Investment Activities: | |||||||||
Operations: | |||||||||
Net investment income | $ | 6,801,602 | $ | 5,228,316 | |||||
Net realized gains on investment transactions and foreign currency transactions | 25,277,001 | 33,825,686 | |||||||
Net change in unrealized appreciation on investments and translation of assets and liabilities denominated in foreign currencies | 346,460 | 21,481,221 | |||||||
Change in net assets resulting from operations | 32,425,063 | 60,535,223 | |||||||
Distributions to shareholders from: | |||||||||
Net investment income: | |||||||||
Class I | (35,098 | ) | (85,866 | ) | |||||
Class II | (24,760 | ) | (51,959 | ) | |||||
Class III | (1,711,758 | ) | (2,882,315 | ) | |||||
Class IV | (653,036 | ) | (1,399,739 | ) | |||||
Class VI | (1,973,127 | ) | (1,546,737 | ) | |||||
Net realized gains: | |||||||||
Class I | (236,344 | ) | (266,274 | ) | |||||
Class II | (189,984 | ) | (183,372 | ) | |||||
Class III | (11,553,312 | ) | (8,950,355 | ) | |||||
Class IV | (4,387,787 | ) | (4,384,367 | ) | |||||
Class VI | (14,829,379 | ) | (5,073,827 | ) | |||||
Change in net assets from shareholder distributions | (35,594,585 | ) | (24,824,811 | ) | |||||
Change in net assets from capital transactions | 98,688,156 | 113,805,438 | |||||||
Change in net assets | 95,518,634 | 149,515,850 | |||||||
Net Assets: | |||||||||
Beginning of period | 382,381,718 | 232,865,868 | |||||||
End of period | $ | 477,900,352 | $ | 382,381,718 | |||||
Accumulated net investment income at end of period | $ | 2,887,087 | $ | 483,264 | |||||
CAPITAL TRANSACTIONS: | |||||||||
Class I Shares | |||||||||
Proceeds from shares issued | $ | 30,213 | $ | 2,999 | |||||
Dividends reinvested | 271,442 | 352,140 | |||||||
Cost of shares redeemed (a) | (692,580 | ) | (1,219,298 | ) | |||||
(390,925 | ) | (864,159 | ) | ||||||
Class II Shares | |||||||||
Proceeds from shares issued | 134 | 10 | |||||||
Dividends reinvested | 214,744 | 235,331 | |||||||
Cost of shares redeemed (a) | (294,704 | ) | (451,731 | ) | |||||
(79,826 | ) | (216,390 | ) | ||||||
Class III Shares | |||||||||
Proceeds from shares issued | 12,471,206 | 50,239,173 | |||||||
Dividends reinvested | 13,265,057 | 11,832,664 | |||||||
Cost of shares redeemed (a) | (19,129,105 | ) | (25,715,267 | ) | |||||
6,607,158 | 36,356,570 | ||||||||
NVIT International | |||||||||
Value Fund | |||||||||
Six Months Ended | Year Ended | ||||||||
June 30, 2007 | December 31, 2006 | ||||||||
Class IV Shares | |||||||||
Proceeds from shares issued | $ | 533,739 | $ | 996,727 | |||||
Dividends reinvested | 5,040,896 | 5,784,106 | |||||||
Cost of shares redeemed (a) | (5,942,575 | ) | (14,128,707 | ) | |||||
(367,940 | ) | (7,347,874 | ) | ||||||
Class VI Shares | |||||||||
Proceeds from shares issued | 77,496,958 | 85,048,295 | |||||||
Dividends reinvested | 16,802,488 | 6,620,561 | |||||||
Cost of shares redeemed (a) | (1,379,757 | ) | (5,791,565 | ) | |||||
92,919,689 | 85,877,291 | ||||||||
Change in net assets from capital transactions | $ | 98,688,156 | $ | 113,805,438 | |||||
SHARE TRANSACTIONS: | |||||||||
Class I Shares | |||||||||
Issued | 1,595 | 117 | |||||||
Reinvested | 14,778 | 21,668 | |||||||
Redeemed | (36,247 | ) | (69,240 | ) | |||||
(19,874 | ) | (47,455 | ) | ||||||
Class II Shares | |||||||||
Issued | – | 1 | |||||||
Reinvested | 11,744 | 14,561 | |||||||
Redeemed | (15,456 | ) | (26,369 | ) | |||||
(3,712 | ) | (11,807 | ) | ||||||
Class III Shares | |||||||||
Issued | 659,181 | 2,868,523 | |||||||
Reinvested | 724,534 | 729,902 | |||||||
Redeemed | (994,176 | ) | (1,474,980 | ) | |||||
389,539 | 2,123,445 | ||||||||
Class IV Shares | |||||||||
Issued | 27,967 | 55,499 | |||||||
Reinvested | 274,450 | 356,063 | |||||||
Redeemed | (311,126 | ) | (805,890 | ) | |||||
(8,709 | ) | (394,328 | ) | ||||||
Class VI Shares | |||||||||
Issued | 4,077,965 | 4,846,861 | |||||||
Reinvested | 920,558 | 409,211 | |||||||
Redeemed | (72,979 | ) | (332,891 | ) | |||||
4,925,544 | 4,923,181 | ||||||||
Total change in shares | 5,282,788 | 6,593,036 | |||||||
(a) | Includes redemption fees, if any. |
Investment Activities | Distributions | |||||||||||||||||||||||||||
Net Realized | ||||||||||||||||||||||||||||
and | ||||||||||||||||||||||||||||
Net Asset | Unrealized | Total | ||||||||||||||||||||||||||
Value, | Net | Gains | from | Net | Net | |||||||||||||||||||||||
Beginning | Investment | (Losses) on | Investment | Investment | Realized | Total | ||||||||||||||||||||||
of Period | Income | Investments | Activities | Income | Gains | Distributions | ||||||||||||||||||||||
Class I Shares | ||||||||||||||||||||||||||||
Period ended December 31, 2003 (f) | $ | 9.25 | 0.02 | 3.90 | 3.92 | – | – | – | ||||||||||||||||||||
For the year ended December 31, 2004 | $ | 13.26 | 0.18 | 2.46 | 2.64 | (0.33 | ) | – | (0.33 | ) | ||||||||||||||||||
For the year ended December 31, 2005 | $ | 15.58 | 0.35 | 1.43 | 1.78 | (0.21 | ) | (0.55 | ) | (0.76 | ) | |||||||||||||||||
For the year ended December 31, 2006 | $ | 16.60 | 0.35 | 3.18 | 3.53 | (0.37 | ) | (1.18 | ) | (1.55 | ) | |||||||||||||||||
For the six months ended June 30, 2007 (Unaudited) | $ | 18.58 | 0.31 | 1.11 | 1.42 | (0.19 | ) | (1.30 | ) | (1.49 | ) | |||||||||||||||||
Class II Shares | ||||||||||||||||||||||||||||
Period ended December 31, 2003 (f) | $ | 9.25 | 0.01 | 3.87 | 3.88 | – | – | – | ||||||||||||||||||||
For the year ended December 31, 2004 | $ | 13.22 | 0.14 | 2.46 | 2.60 | (0.30 | ) | – | (0.30 | ) | ||||||||||||||||||
For the year ended December 31, 2005 | $ | 15.53 | 0.23 | 1.51 | 1.74 | (0.18 | ) | (0.55 | ) | (0.73 | ) | |||||||||||||||||
For the year ended December 31, 2006 | $ | 16.54 | 0.30 | 3.17 | 3.47 | (0.33 | ) | (1.18 | ) | (1.51 | ) | |||||||||||||||||
For the six months ended June 30, 2007 (Unaudited) | $ | 18.50 | 0.28 | 1.12 | 1.40 | (0.17 | ) | (1.30 | ) | (1.47 | ) |
[Additional columns below]
[Continued from above table, first column(s) repeated]
Ratios/Supplemental Data | ||||||||||||||||||||||||||||||||||||||
Ratio of Net | ||||||||||||||||||||||||||||||||||||||
Ratio of | Investment | |||||||||||||||||||||||||||||||||||||
Ratio of | Expenses | Income | ||||||||||||||||||||||||||||||||||||
Paid-in | Net | (Prior to | (Prior to | |||||||||||||||||||||||||||||||||||
Capital | Net Assets | Ratio of | Investment | Reimbursements) | Reimbursements) | |||||||||||||||||||||||||||||||||
from | Net Asset | at End of | Expenses to | Income to | to Average | to Average | ||||||||||||||||||||||||||||||||
Redemption | Value, End | Total | Period | Average Net | Average Net | Net Assets | Net Assets | Portfolio | ||||||||||||||||||||||||||||||
Fees | of Period | Return (a) | (000s) | Assets (b) | Assets (b) | (b)(c) | (b)(c) | Turnover (d) | ||||||||||||||||||||||||||||||
Class I Shares | ||||||||||||||||||||||||||||||||||||||
Period ended December 31, 2003 (f) | 0.09 | $ | 13.26 | 45.08% | $ | 542 | 1.20% | 0.56% | (e) | (e) | 91.20% | |||||||||||||||||||||||||||
For the year ended December 31, 2004 | 0.01 | $ | 15.58 | 20.29% | $ | 6,247 | 0.86% | 1.33% | (e) | (e) | 42.68% | |||||||||||||||||||||||||||
For the year ended December 31, 2005 | – | $ | 16.60 | 12.09% | $ | 4,349 | 0.91% | 1.92% | (e) | (e) | 48.94% | |||||||||||||||||||||||||||
For the year ended December 31, 2006 | – | $ | 18.58 | 22.67% | $ | 3,985 | 1.01% | 1.95% | (e) | (e) | 48.61% | |||||||||||||||||||||||||||
For the six months ended June 30, 2007 (Unaudited) | – | $ | 18.51 | 7.75% | $ | 3,603 | 1.01% | 3.08% | 1.01% | 3.08% | 31.06% | |||||||||||||||||||||||||||
Class II Shares | ||||||||||||||||||||||||||||||||||||||
Period ended December 31, 2003 (f) | 0.09 | $ | 13.22 | 44.64% | $ | 1,523 | 1.45% | 0.20% | (e) | (e) | 91.20% | |||||||||||||||||||||||||||
For the year ended December 31, 2004 | 0.01 | $ | 15.53 | 20.00% | $ | 3,368 | 1.10% | 1.69% | (e) | (e) | 42.68% | |||||||||||||||||||||||||||
For the year ended December 31, 2005 | – | $ | 16.54 | 11.79% | $ | 2,852 | 1.17% | 1.40% | (e) | (e) | 48.94% | |||||||||||||||||||||||||||
For the year ended December 31, 2006 | – | $ | 18.50 | 22.40% | $ | 2,972 | 1.26% | 1.68% | (e) | (e) | 48.61% | |||||||||||||||||||||||||||
For the six months ended June 30, 2007 (Unaudited) | – | $ | 18.43 | 7.66% | $ | 2,892 | 1.26% | 2.86% | 1.26% | 2.86% | 31.06% |
(a) | Not annualized for periods less than one year. | |
(b) | Annualized for periods less than one year. | |
(c) | During the period, certain fees were waived and/or reimbursed. If such waivers/reimbursements had not occurred, the ratios would have been as indicated. | |
(d) | Portfolio turnover is calculated on the basis of the Fund as a whole without distinguishing among the classes of shares. | |
(e) | There were no fee reductions during the period. | |
(f) | For the period from April 28, 2003 (commencement of operations) through December 31, 2003. | |
(g) | The NVIT International Value Fund retained the history of the Market Street International Fund and the existing shares of the Fund were designated Class IV shares. | |
(h) | For the period from April 28, 2004 (commencement of operations) through December 31, 2004. |
Investment Activities | Distributions | |||||||||||||||||||||||||||
Net Realized | ||||||||||||||||||||||||||||
and | ||||||||||||||||||||||||||||
Net Asset | Unrealized | Total | ||||||||||||||||||||||||||
Value, | Net | Gains | from | Net | Net | |||||||||||||||||||||||
Beginning | Investment | (Losses) on | Investment | Investment | Realized | Total | ||||||||||||||||||||||
of Period | Income | Investments | Activities | Income | Gains | Distributions | ||||||||||||||||||||||
Class III Shares | ||||||||||||||||||||||||||||
Period ended December 31, 2003 (f) | $ | 9.25 | 0.05 | 3.84 | 3.89 | – | – | – | ||||||||||||||||||||
For the year ended December 31, 2004 | $ | 13.23 | 0.18 | 2.45 | 2.63 | (0.33 | ) | – | (0.33 | ) | ||||||||||||||||||
For the year ended December 31, 2005 | $ | 15.54 | 0.24 | 1.54 | 1.78 | (0.21 | ) | (0.55 | ) | (0.76 | ) | |||||||||||||||||
For the year ended December 31, 2006 | $ | 16.56 | 0.34 | 3.18 | 3.52 | (0.37 | ) | (1.18 | ) | (1.55 | ) | |||||||||||||||||
For the six months ended June 30, 2007 (Unaudited) | $ | 18.53 | 0.30 | 1.11 | 1.41 | (0.19 | ) | (1.30 | ) | (1.49 | ) | |||||||||||||||||
Class IV Shares | ||||||||||||||||||||||||||||
For the year ended December 31, 2002 | $ | 11.20 | 0.18 | (1.41 | ) | (1.23 | ) | (0.12 | ) | – | (0.12 | ) | ||||||||||||||||
For the year ended December 31, 2003 (g) | $ | 9.85 | 0.18 | 3.41 | 3.59 | (0.27 | ) | – | (0.27 | ) | ||||||||||||||||||
For the year ended December 31, 2004 | $ | 13.26 | 0.22 | 2.39 | 2.61 | (0.31 | ) | – | (0.31 | ) | ||||||||||||||||||
For the year ended December 31, 2005 | $ | 15.57 | 0.25 | 1.52 | 1.77 | (0.19 | ) | (0.55 | ) | (0.74 | ) | |||||||||||||||||
For the year ended December 31, 2006 | $ | 16.60 | 0.34 | 3.18 | 3.52 | (0.37 | ) | (1.18 | ) | (1.55 | ) | |||||||||||||||||
For the six months ended June 30, 2007 (Unaudited) | $ | 18.57 | 0.30 | 1.13 | 1.43 | (0.19 | ) | (1.30 | ) | (1.49 | ) | |||||||||||||||||
Class VI Shares | ||||||||||||||||||||||||||||
Period ended December 31, 2004 (h) | $ | 13.63 | 0.13 | 1.95 | 2.08 | (0.17 | ) | – | (0.17 | ) | ||||||||||||||||||
For the year ended December 31, 2005 | $ | 15.55 | 0.20 | 1.55 | 1.75 | (0.19 | ) | (0.55 | ) | (0.74 | ) | |||||||||||||||||
For the year ended December 31, 2006 | $ | 16.56 | 0.30 | 3.17 | 3.47 | (0.36 | ) | (1.18 | ) | (1.54 | ) | |||||||||||||||||
For the six months ended June 30, 2007 (Unaudited) | $ | 18.49 | 0.25 | 1.13 | 1.38 | (0.18 | ) | (1.30 | ) | (1.48 | ) |
[Additional columns below]
[Continued from above table, first column(s) repeated]
Ratios/Supplemental Data | ||||||||||||||||||||||||||||||||||||||
Ratio of Net | ||||||||||||||||||||||||||||||||||||||
Ratio of | Investment | |||||||||||||||||||||||||||||||||||||
Ratio of | Expenses | Income | ||||||||||||||||||||||||||||||||||||
Paid-in | Net | (Prior to | (Prior to | |||||||||||||||||||||||||||||||||||
Capital | Net Assets | Ratio of | Investment | Reimbursements) | Reimbursements) | |||||||||||||||||||||||||||||||||
from | Net Asset | at End of | Expenses to | Income to | to Average | to Average | ||||||||||||||||||||||||||||||||
Redemption | Value, End | Total | Period | Average Net | Average Net | Net Assets | Net Assets | Portfolio | ||||||||||||||||||||||||||||||
Fees | of Period | Return (a) | (000s) | Assets (b) | Assets (b) | (b)(c) | (b)(c) | Turnover (d) | ||||||||||||||||||||||||||||||
Class III Shares | ||||||||||||||||||||||||||||||||||||||
Period ended December 31, 2003 (f) | 0.09 | $ | 13.23 | 44.75% | $ | 9,620 | 1.13% | 1.30% | (e) | (e) | 91.20% | |||||||||||||||||||||||||||
For the year ended December 31, 2004 | 0.01 | $ | 15.54 | 20.26% | $ | 69,043 | 0.86% | 1.42% | (e) | (e) | 42.68% | |||||||||||||||||||||||||||
For the year ended December 31, 2005 | – | $ | 16.56 | 12.05% | $ | 116,151 | 0.93% | 1.64% | (e) | (e) | 48.94% | |||||||||||||||||||||||||||
For the year ended December 31, 2006 | – | $ | 18.53 | 22.75% | $ | 169,278 | 1.01% | 1.87% | (e) | (e) | 48.61% | |||||||||||||||||||||||||||
For the six months ended June 30, 2007 (Unaudited) | – | $ | 18.45 | 7.72% | $ | 175,782 | 1.01% | 3.16% | 1.01% | 3.16% | 31.06% | |||||||||||||||||||||||||||
Class IV Shares | ||||||||||||||||||||||||||||||||||||||
For the year ended December 31, 2002 | – | $ | 9.85 | (11.10% | ) | $ | 59,335 | 1.00% | 1.63% | (e) | (e) | 35.00% | ||||||||||||||||||||||||||
For the year ended December 31, 2003 (g) | 0.09 | $ | 13.26 | 38.52% | $ | 77,347 | 1.12% | 1.62% | (e) | (e) | 91.20% | |||||||||||||||||||||||||||
For the year ended December 31, 2004 | 0.01 | $ | 15.57 | 20.04% | $ | 73,953 | 1.00% | 1.56% | (e) | (e) | 42.68% | |||||||||||||||||||||||||||
For the year ended December 31, 2005 | – | $ | 16.60 | 11.97% | $ | 66,597 | 1.03% | 1.56% | (e) | (e) | 48.94% | |||||||||||||||||||||||||||
For the year ended December 31, 2006 | – | $ | 18.57 | 22.74% | $ | 67,200 | 1.02% | 1.93% | (e) | (e) | 48.61% | |||||||||||||||||||||||||||
For the six months ended June 30, 2007 (Unaudited) | – | $ | 18.51 | 7.76% | $ | 66,786 | 0.99% | 3.16% | 0.99% | 3.16% | 31.06% | |||||||||||||||||||||||||||
Class VI Shares | ||||||||||||||||||||||||||||||||||||||
Period ended December 31, 2004 (h) | 0.01 | $ | 15.55 | 15.45% | $ | 13,117 | 1.11% | 0.63% | (e) | (e) | 42.68% | |||||||||||||||||||||||||||
For the year ended December 31, 2005 | – | $ | 16.56 | 11.80% | $ | 42,916 | 1.19% | 1.41% | (e) | (e) | 48.94% | |||||||||||||||||||||||||||
For the year ended December 31, 2006 | – | $ | 18.49 | 22.41% | $ | 138,946 | 1.26% | 1.40% | (e) | (e) | 48.61% | |||||||||||||||||||||||||||
For the six months ended June 30, 2007 (Unaudited) | – | $ | 18.39 | 7.59% | $ | 228,838 | 1.26% | 3.12% | 1.26% | 3.12% | 31.06% |
(a) | Not annualized for periods less than one year. | |
(b) | Annualized for periods less than one year. | |
(c) | During the period, certain fees were waived and/or reimbursed. If such waivers/reimbursements had not occurred, the ratios would have been as indicated. | |
(d) | Portfolio turnover is calculated on the basis of the Fund as a whole without distinguishing among the classes of shares. | |
(e) | There were no fee reductions during the period. | |
(f) | For the period from April 28, 2003 (commencement of operations) through December 31, 2003. | |
(g) | The NVIT International Value Fund retained the history of the Market Street International Fund and the existing shares of the Fund were designated Class IV shares. | |
(h) | For the period from April 28, 2004 (commencement of operations) through December 31, 2004. |
(a) | Security Valuation |
Securities for which market quotations are readily available are valued at current market value as of “Valuation Time.” Valuation Time is as of the close of regular trading on the New York Stock Exchange (usually 4 p.m. Eastern time). Equity securities are valued at the last quoted sale price or, if there is no sale price, the last quoted bid price provided by an independent pricing service approved by the Trust’s Board of Trustees (“Board of Trustees”). Securities traded on NASDAQ are valued at the NASDAQ official closing price. Prices are taken from the primary market or exchange in which each security trades. | |
Most securities listed on a foreign exchange are valued either at fair value (see description below) or at the last sale price at the close of the exchange on which the security is principally traded. Foreign securities, currencies, and other assets and liabilities denominated in foreign currencies are translated into U.S. dollars at the exchange rate of said currencies against the U.S. dollar, as of Valuation Time, as provided by an independent pricing service approved by the Board of Trustees. | |
Securities for which market quotations are not readily available, or for which an independent pricing service does not provide a value or provides a value that does not represent fair value in the judgment of the Fund’s investment adviser or designee, are valued at fair value under procedures approved by the Board of Trustees. The “Fair Value” of these securities is determined in good faith by taking into account relevant factors and surrounding circumstances. Methods utilized to obtain a “Fair Value” may include the following non-exclusive list of acceptable methods: (i) a multiple of earnings; (ii) the discount from market value of a similar, freely traded security; (iii) the yield-to-maturity for debt issues; or (iv) a consolidation of the methods. The Trust’s Valuation & Operations Committee considers a non-exclusive list of factors to arrive at the appropriate method of determining “Fair Value.” For example, fair value determinations are required for securities whose value is affected by a “significant” event that materially affects the value of a domestic or foreign security which occurs subsequent to the time of the close of the principal market on which such domestic or foreign security trades and before the Valuation Time (i.e., a “subsequent event”). Typically, |
this will involve events occurring after the close of a foreign market on which a security trades and before the next Valuation Time. | |
The Fund values foreign securities at fair value in the circumstances described below. Generally, trading in foreign securities markets is completed each day at various times prior to the Valuation Time. Due to the time differences between the closings of the relevant foreign securities exchanges and the Valuation Time for the Fund, the Fund will fair value its foreign investments when it is determined that the market quotations for the foreign investments either are not readily available or are unreliable and, therefore, do not represent fair value. When the fair value prices are utilized, these prices will attempt to reflect the impact of the U.S. financial markets’ perceptions and trading activities on the Fund’s foreign investments since the last closing prices of the foreign investments were calculated on their primary foreign securities markets or exchanges. For these purposes, the Board of Trustees has determined that movements in relevant indices or other appropriate market indicators, after the close of the foreign securities exchanges, may demonstrate that market quotations are unreliable, and may trigger fair value pricing for certain securities. Consequently, fair valuation of portfolio securities may occur on a daily basis. |
(b) | Repurchase Agreements |
The Fund may enter into repurchase agreements with an entity which is a member of the Federal Reserve System or which is a “primary dealer” (as designated by the Federal Reserve Bank of New York) in U.S. Government obligations. The repurchase price generally equals the price paid by the Fund plus interest negotiated on the basis of current short-term rates, which may be more or less than the rate on the underlying portfolio securities. The seller under a repurchase agreement is required to maintain the value of the collateral held pursuant to the agreement at a market value equal to or greater than the repurchase price (including accrued interest). Collateral subject to repurchase agreements is held by the Fund’s custodian or another qualified sub-custodian or in the Federal Reserve/ Treasury book-entry system. If the counterparty defaults and the fair value of the collateral declines, realization of the collateral by the Fund may be delayed or limited. The Fund may transfer uninvested cash balances into a pooled cash account. These balances are invested in one or more repurchase agreements, with the counterparty of Nomura Securities, which is fully collateralized by U.S. Government Agency Mortgages. |
(c) | Foreign Currency Transactions |
The accounting records of the Fund are maintained in U.S. dollars. Foreign currency amounts are translated into U.S. dollars at the current rate of exchange to determine the value of investments, assets and liabilities. The Fund may enter into foreign currency contracts in connection with purchases or sales of securities denominated in a foreign currency. Purchases and sales of securities, and income and expenses, are translated at the prevailing rate of exchange on the respective date of these transactions. The Fund does not isolate that portion of the results of operations resulting from changes in foreign exchange rates on investments from fluctuations arising from changes in market prices of securities held. These fluctuations are included with the net realized and unrealized gain or loss from investments and foreign currencies. |
(d) | Forward Foreign Currency Contracts |
The Fund may enter into forward foreign currency contracts in connection with planned purchases or sales of securities or to hedge the U.S. dollar value of portfolio securities denominated in a particular currency. The Fund could be exposed to risks if the counterparties to the contracts are unable to meet the terms of their contracts and from unanticipated movements in the value of a foreign currency relative to the U.S. dollar. Forward foreign currency contracts are valued at the current cost of covering these contracts, as provided by an independent pricing service approved by the Board of Trustees. The forward foreign currency contracts are adjusted by the daily exchange rate of the underlying currency and any gains or losses are recorded for financial statement purposes as unrealized gains or losses until the contract settlement date. |
(e) | Futures Contracts |
The Fund may invest in financial futures contracts (“futures contracts”) for the purpose of hedging its existing portfolio securities or securities that the Fund intends to purchase against fluctuations in value caused by changes in prevailing market interest rates or prices. Futures contracts may also be entered into for non-hedging purposes. | |
Upon entering into a futures contract, the Fund is required to pledge to the broker an amount of cash and/or other assets equal to a certain percentage of the contract amount (initial margin deposit). Subsequent payments, known as “variation margin,” are made each day, depending on the daily fluctuations in the fair value/market value of the underlying assets. A gain or loss equal to the daily variation margin is recognized on a daily basis. Futures contracts are valued daily at their last quoted sale price. | |
A “sale” of a futures contract means the creation of a contractual obligation to deliver the securities or foreign currency called for by the contract at a fixed price at a specified time in the future. A “purchase” of a futures contract means the creation of a contractual obligation to acquire the securities or foreign currency at a fixed price at a specified time in the future. | |
Should market conditions change unexpectedly, the Fund may not achieve the anticipated benefits of the futures contracts and may realize a loss. The use of futures transactions for hedging purposes involves the risk of imperfect correlation in movements in the price of futures contracts, interest rates, and the value of the underlying hedged assets. |
(f) | Written Options Contracts |
The Fund may write options contracts. A written option obligates the Fund to deliver (written call) or to receive (written put) a specified quantity of an underlying asset at the contract amount upon exercise by the holder of the option. When the Fund writes an option, an amount equal to the premium received by the Fund is recorded as a liability and is subsequently adjusted to the current fair value of the option written. Premiums received from writing options that expire unexercised are treated by the Fund on the expiration date as realized gains from investments. The difference between the premium and the amount paid on effecting a closing purchase transaction, as a realized loss. If a call option is exercised, the premium is added to the proceeds from the sale of the underlying security or currency in determining whether the Fund has realized a gain or loss. If a put option is exercised, the premium reduces the cost basis of the securities purchased by the Fund. Options traded on an exchange are valued at the last quoted sale price, or in the absence of a sale, the bid price provided by an independent pricing service approved by the Board of Trustees. Non-exchange traded options are valued using dealer supplied quotes. The Fund as a writer of an option bears the market risk of an unfavorable change in the price of the security underlying the written option. |
(g) | Short Sales |
The Fund is authorized to engage in short-selling of portfolio securities which obligates the Fund to replace any security that the Fund has borrowed by purchasing the security at current market value sometime in the future. The Fund will incur a loss if the price of the security increases between the date of the short sale and the date on which the Fund replaces the borrowed security. The Fund generally will realize a gain if the price of the security declines between these dates. Until the Fund replaces the borrowed security, the Fund will maintain a segregated account with cash, U.S. Government securities and/or securities held long to sufficiently cover the Fund’s short position on a daily basis. Dividends declared on securities sold short are recorded as an expense on the ex-dividend date and paid to the counterparty on the dividend pay date. |
(h) | Security Transactions and Investment Income |
Security transactions are accounted for on the date the security is purchased or sold (“trade date”). Securities gains and losses are calculated on the identified cost basis. Interest income is recognized on the accrual basis and includes, where applicable, the amortization or accretion of premium or discount. Dividend income is recorded on the ex-dividend date. |
(i) | Securities Lending |
To generate additional income, the Fund may lend its portfolio securities, up to 331/3% of the Fund, to brokers, dealers and other financial institutions provided that (1) the borrower delivers cash or securities as collateral with respect to each new loan of U.S. securities, equal to at least 102% of the value of the portfolio securities loaned, and with respect to each new loan on non-U.S. securities, collateral of at least 105% of the value of the portfolio securities loaned; and (2) at all times thereafter shall require the borrower to mark-to-market the collateral on a daily basis so that the market value of such collateral does not fall below 100% of the value of securities loaned. The Fund receives payments from borrowers equivalent to the dividends and interest that would have been earned on securities loaned while simultaneously seeking to earn income on the investment of cash collateral. There may be risks of delay in recovery of the securities should the borrower of the securities fail financially. Loans will be made, however, only to borrowers deemed by the Fund’s investment adviser to be of good standing and creditworthy under guidelines established by the Board of Trustees and when, in judgment of the adviser, the consideration which can be earned currently from these securities loans justifies the attendant risks. Loans are subject to termination by the Fund or the borrower at any time, and, therefore, are not considered to be illiquid investments. JPMorgan Chase Bank serves as custodian for the securities lending program of the Fund. JPMorgan Chase Bank receives a fee based on the value of the collateral received from borrowers. | |
Information on the investment of cash collateral is shown in the Statement of Investments. | |
As of June 30, 2007, the Fund had securities with the following value on loan: |
Value of | ||||||
Value of Loaned Securities | Collateral | |||||
$76,697,581 | $ | 80,334,123 | ||||
(j) | Distributions to Shareholders |
The Fund’s dividends from net investment income, if any, are declared and paid quarterly. The Fund’s distributions from net realized capital gains, if any, are declared and distributed at least annually. | |
Dividends and distributions to shareholders are determined in accordance with federal income tax regulations, which may differ from GAAP. These “book/tax” differences are considered either permanent or temporary in nature. In accordance with the American Institute of Certified Public Accountants Statement of Position 93-2, permanent differences (i.e., reclassification of market discounts, foreign exchange gain/loss, paydowns, and distributions from real estate investment trusts) are reclassified within the capital accounts based on their nature for federal income tax purposes; temporary differences do not require reclassification. These reclassifications have no effect upon the net asset value of the Fund. To the extent distributions exceed current and accumulated earnings and profits for federal income tax purposes, these distributions are reported as distributions of paid-in-capital. |
(k) | Federal Income Taxes |
It is the policy of the Fund to qualify or to continue to qualify as a “regulated investment company” by complying with the provisions available to certain investment companies, as defined in Subchapter M of the U.S. Internal Revenue Code, and to make distributions of net investment income and net realized capital gains sufficient to relieve the Fund from all, or substantially all, federal income taxes. |
As of June 30, 2007, the tax cost of securities and the breakdown of unrealized appreciation (depreciation) for the Fund was as follows: |
Net | ||||||||||||||||
Unrealized | ||||||||||||||||
Tax Cost of | Unrealized | Unrealized | Appreciation | |||||||||||||
Securities | Appreciation | Depreciation | (Depreciation) | |||||||||||||
$ | 507,249,114 | $ | 53,975,034 | $ | (7,694,090 | ) | $ | 46,280,944 | ||||||||
(l) | Allocation of Expenses, Income, and Gains and Losses |
Expenses directly attributable to the Fund are charged to the Fund. Expenses not directly attributable to the Fund are allocated proportionately among various or all funds within the Trust. The method used by the Fund for allocating income, fund level expenses, and realized and unrealized gains or losses is based on the fair value of shares outstanding relative to net assets. Under this method, each class of shares participates based on the total net asset value of that class’s shares in proportion to the total net assets of the Fund. Expenses specific to a class (such as Rule 12b-1 and administrative services fees) are charged to that class. |
Total | ||||||
Fee Schedule | Fees | |||||
Up to $500 million | 0.75% | |||||
$500 million up to $2 billion | 0.70% | |||||
$2 billion or more | 0.65% | |||||
Combined Fee Schedule* | ||||||
Up to $1 billion | 0.15% | |||||
$1 billion up to $3 billion | 0.10% | |||||
$3 billion up to $8 billion | 0.05% | |||||
$8 billion up to $10 billion | 0.04% | |||||
$10 billion up to $12 billion | 0.02% | |||||
$12 billion or more | 0.01% | |||||
* | The assets of the Nationwide NVIT Investor Destinations Aggressive Fund, the Nationwide NVIT Investor Destinations Moderately Aggressive Fund, the Nationwide NVIT Investor Destinations Moderate Fund, the Nationwide NVIT Investor Destinations Moderately Conservative Fund, and the Nationwide NVIT Investor Destinations Conservative Fund (collectively, the “Investor Destinations Funds”) are excluded from the Trust asset level amount in order to calculate this asset-based fee. The Investor Destinations Funds do not pay any part of this fee. |
Number of Portfolios | ||||||||||
Position(s) Held | in the | |||||||||
with the Trust | Principal Occupation(s) | Nationwide Fund | Other | |||||||
Name, Address | and Length of | During Past | Complex Overseen | Directorships | ||||||
and Year of Birth | Time Served1 | Five Years | by Trustee | Held by Trustee2 | ||||||
Charles E. Allen c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1948 | Trustee since July 2000 | Mr. Allen is Chairman, Chief Executive Officer and President of Graimark Realty Advisors, Inc. (real estate development, investment and asset management). | 89 | None | ||||||
Paula H.J. Cholmondeley c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1947 | Trustee since July 2000 | Ms. Cholmondeley was Vice President and General Manager of Sappi Fine Paper North America from April 2000 through December 2003. | 89 | Director of Dentsply International, Inc. (dental products), Ultralife Batteries, Inc., Terex Corporation (construction equipment), Minerals Technology, Inc. (specialty chemicals) and Albany International Corp. (paper industry) | ||||||
C. Brent DeVore3 c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1940 | Trustee since 1990 | Dr. DeVore is President of Otterbein College. | 89 | None | ||||||
Phyllis Kay Dryden c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1947 | Trustee since December 2004 | Ms. Dryden was a partner of Mitchell Madison, a management consulting company from January 2006 until December 2006; she is currently a consultant with the company. Ms. Dryden was formerly Managing Partner of march FIRST, a global management consulting firm. | 89 | None | ||||||
Barbara L. Hennigar c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1935 | Trustee since July 2000 | Retired. | 89 | None | ||||||
Number of Portfolios | ||||||||||
Position(s) Held | in the | |||||||||
with the Trust | Principal Occupation(s) | Nationwide Fund | Other | |||||||
Name, Address | and Length of | During Past | Complex Overseen | Directorships | ||||||
and Year of Birth | Time Served1 | Five Years | by Trustee | Held by Trustee2 | ||||||
Barbara I. Jacobs c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1950 | Trustee since December 2004 | Ms. Jacobs served as Chairman of the Board of Directors of KICAP Network Fund, a European (United Kingdom) hedge fund, from January 2001 through January 2006. From 1998-2003, Ms. Jacobs was also a Managing Director and European Portfolio Manager of CREF Investments (Teachers Insurance and Annuity Association-College Retirement Equities Fund). | 89 | None | ||||||
Douglas F. Kridler c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1955 | Trustee since September 1997 | Mr. Kridler has served as the President and Chief Executive Officer of the Columbus Foundation (a Columbus, OH-based foundation which manages over 1,300 individual endowment funds) since February 2002. Prior to January 31, 2002, Mr. Kridler was the President of the Columbus Association for the Performing Arts and Chairman of the Greater Columbus Convention and Visitors Bureau. | 89 | None | ||||||
Michael D. McCarthy c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1947 | Trustee since December 2004 | Retired. Mr. McCarthy was Chairman of VMAC (commodity swaps) from October 2002 until January 2007; and a partner of Pineville Properties LLC (a commercial real estate development firm) from September 2000 until January 2007. | 89 | None | ||||||
David C. Wetmore c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1948 | Trustee since 1995 and Chairman since February 2005 | Retired. | 89 | None | ||||||
1 | Length of time served includes time served with the Trust’s predecessors. | |
2 | Directorships held in (1) any other investment companies registered under the 1940 Act, (2) any company with a class of securities registered pursuant to Section 12 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or (3) any company subject to the requirements of Section 15(d) of the Exchange Act. | |
3 | Mr. DeVore has served as President of Otterbein College since 1984. Mark Thresher, President and Chief Operating Officer of Nationwide Financial Services, Inc. (“NFS”) has served as a member of the Board of Trustees of Otterbein College since 2000, currently serves as one of 30 of its trustees, and is currently one of two Vice Chairmen of the Board. Each of Nationwide Fund Advisors (“NFA”), the Funds’ investment adviser, and Nationwide Fund Distributors LLC (“NFD”), principal underwriter to the Trust, is a wholly-owned subsidiary of NFS. | |
Additional information regarding the Trustees and Officers may be found in the Trust’s Statement of Additional Information, which is available without charge upon request, by calling 800-848-0920. |
Number of Portfolios | ||||||||||
Position(s) Held | in the | |||||||||
with the Trust | Principal Occupation(s) | Nationwide Fund | Other | |||||||
Name, Address | and Length of | During Past | Complex Overseen | Directorships | ||||||
and Year of Birth | Time Served1 | 5 Years | by Trustee | Held by Trustee 2 | ||||||
Arden L. Shisler c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1941 | Trustee since February 2000 | Retired. Mr. Shisler is the former President and Chief Executive Officer of KeB Transport, Inc., a trucking firm (2000 through 2002). He served as a consultant to KeB from January 2003 through December 2004. Since 1992, Mr. Shisler has also been Chairman of the Board for Nationwide Mutual Insurance Company.3 | 89 | Director of Nationwide Financial Services, Inc., Chairman of Nationwide Mutual Insurance Company3 | ||||||
John H. Grady Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1961 | President & Chief Executive Officer since December 2006 | Mr. Grady is President, and Chief Executive Officer of Nationwide Funds Group which includes Nationwide Fund Advisors,3 Nationwide Fund Management LLC,3 Nationwide Fund Distributors LLC 3 and NWD Investments,2 the asset management operations of Nationwide Mutual Insurance Company, which includes Morley Capital Management, Inc.,2 Nationwide Separate Accounts LLC,2 NorthPointe Capital LLC,2 and Nationwide SA Capital Trust2. From March 2004 until March 2006, Mr. Grady was Chief Executive Officer of Constellation Investment Management Co., L.P. (registered investment adviser), and President and Chief Executive Officer of Constellation Funds Group (registered investment companies). He also was President of Constellation Investment Distribution Co., Inc. (registered broker-dealer) from March 2004 until June 2006. From February 2001 until February 2004, Mr. Grady was Chief Operating and Chief Legal Officer; Managing Director, Mutual Funds Group, Turner Investment Partners, Inc. (registered investment adviser); Executive Vice President of Turner Funds and Turner Institutional Portfolios (registered investment companies); and President, Turner Investment Distributors, Inc. (registered broker-dealer). | N/A | None | ||||||
Gerald J. Holland Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1951 | Treasurer since March 2001 | Mr. Holland is Senior Vice President—Operations for Nationwide Funds Group3. | N/A | N/A | ||||||
Number of Portfolios | ||||||||||
Position(s) Held | in the | |||||||||
with the Trust | Principal Occupation(s) | Nationwide Fund | Other | |||||||
Name, Address | and Length of | During Past | Complex Overseen | Directorships | ||||||
and Year of Birth | Time Served1 | 5 Years | by Trustee | Held by Trustee 2 | ||||||
Michael A. Krulikowski Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1959 | Chief Compliance Officer from June 2004 to August 20074 | Mr. Krulikowski is Vice President and Chief Compliance Officer of Nationwide Funds Group3, Morley Capital Management, Inc.3, Nationwide SA Capital Trust (since 1999)3, and Nationwide Separate Accounts LLC (since August 2005).3 Since June 2004, Mr. Krulikowski has also served as Chief Compliance Officer of the Trust. From November 1999 through May 2007, he served as Vice President and Chief Compliance Officer of NorthPointe Capital LLC. 3 | N/A | N/A | ||||||
Eric E. Miller Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1953 | Secretary since December 2002 | Mr. Miller is Senior Vice President, General Counsel, and Assistant Secretary for Nationwide Funds Group3 and NWD Investments.2 From August 2000 to August 2002, Mr. Miller was a Partner with Stradley Ronon Stevens & Young, LLP. | N/A | N/A | ||||||
1 | Length of time served includes time served with the Trust’s predecessors. | |
2 | Directorships held in (1) any other investment companies registered under the 1940 Act, (2) any company with a class of securities registered pursuant to Section 12 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or (3) any company subject to the requirements of Section 15(d) of the Exchange Act. | |
3 | This position is held with an affiliated person or principal underwriter of the Trust. | |
4 | Effective August 3, 2007, the Board of Trustees approved Carol Baldwin Moody as Chief Compliance Officer of the Trust. Since November 2005, Ms. Moody has been Senior Vice President, Chief Compliance Officer of Nationwide Financial Services, Nationwide Life Insurance Company, Nationwide Life and Annuity Insurance Company, and Nationwide Investment Advisors, LLC. From February 2004-November 2005, she was Chief Compliance Officer of TIAA-CREF and from April 2000-February 2004, she was Managing Director and General Counsel, TCW/ Latin America Partners, LLC and Baeza & Co., LLC. | |
Federal law requires the Trust, each of its investment advisers and sub-advisers to adopt procedures for voting proxies (“Proxy Voting Guidelines”) and to provide a summary of those Proxy Voting Guidelines used to vote the securities held by the Funds. The Funds’ proxy voting policies and procedures are available without charge (i) upon request, by calling 800-848-0920, (ii) on the Funds’ website at www.nationwidefunds.com, or (iii) on the Securities and Exchange Commission’s website at www.sec.gov. |
(i) | General Information Regarding the Board’s Review of Investment Advisory Agreements |
(ii) | Board Conclusions Regarding the Fund’s Advisory Agreement |
Number of Shares | ||||||
Fund | Cast/Not Cast | Percentages | ||||
Federated NVIT High Income Bond Fund (Formerly Federated GVIT High Income Bond Fund) | FOR AGAINST ABSTAIN TOTAL | 30,051,703.188 shares 618,245.021 shares 1,813,550.431 shares 32,483,498.640 shares | 92.514% 1.903% 5.583% | |||
NVIT International Index Fund (Formerly GVIT International Index Fund) | FOR AGAINST ABSTAIN TOTAL | 4,322,203.982 shares 2,758.318 shares 135,636.840 shares 4,460,599.140 shares | 96.897% 0.062% 3.041% | |||
NVIT International Value Fund (Formerly GVIT International Value Fund) | FOR AGAINST ABSTAIN TOTAL | 20,032,843.199 shares 333,588.902 shares 1,093,293.879 shares 21,459,725.980 shares | 93.351% 1.554% 5.095% | |||
NVIT Mid Cap Index Fund (Formerly GVIT Mid Cap Index Fund) | FOR AGAINST ABSTAIN TOTAL | 35,380,179.120 shares 631,117.844 shares 1,565,714.306 shares 37,577,011.270 shares | 94.154% 1.679% 4.167% |
Number of Shares | ||||||
Fund | Cast/Not Cast | Percentages | ||||
NVIT S&P 500 Index Fund (Formerly GVIT S&P 500 Index Fund) | FOR AGAINST ABSTAIN TOTAL | 56,119,814.230 shares 666,195.542 shares 1,944,898.888 shares 58,730,908.660 shares | 95.554% 1.134% 3.312% | |||
Nationwide Multi-Manager NVIT Small Cap Growth Fund (Formerly GVIT Small Cap Growth Fund) | FOR AGAINST ABSTAIN TOTAL | 7,632,918.513 shares 149,458.111 shares 451,583.036 shares 8,233,959.660 shares | 92.700% 1.816% 5.484% | |||
Nationwide Multi-Manager NVIT Small Cap Value Fund (Formerly GVIT Small Cap Value Fund) | FOR AGAINST ABSTAIN TOTAL | 48,649,396.525 shares 979,183.753 shares 2,786,133.102 shares 52,414,713.380 shares | 92.816% 1.868% 5.316% | |||
Nationwide Multi-Manager NVIT Small Company Fund (Formerly GVIT Small Company Fund) | FOR AGAINST ABSTAIN TOTAL | 29,903,181.700 shares 838,774.923 shares 2,006,741.307 shares 32,748,697.930 shares | 91.311% 2.561% 6.128% | |||
Gartmore NVIT Developing Markets Fund (Formerly Gartmore GVIT Developing Markets Fund) | FOR AGAINST ABSTAIN TOTAL | 21,0177,889.443 shares 424,272.958 shares 1,543,850.729 shares 23,046,013.130 shares | 91.460% 1.841% 6.699% | |||
Gartmore NVIT Emerging Markets Fund (Formerly Gartmore GVIT Emerging Markets Fund) | FOR AGAINST ABSTAIN TOTAL | 17,050,534.593 shares 526,574.722 shares 881,608.905 shares 18,458,718.220 shares | 92.371% 2.853% 4.776% | |||
Nationwide NVIT Global Financial Services Fund (Formerly Gartmore GVIT Global Financial Services Fund) | FOR AGAINST ABSTAIN TOTAL | 1,554,847.333 shares 19,539.033 shares 52,206.494 shares 1,626,592.860 shares | 95.589% 1.201% 3.210% | |||
Nationwide NVIT Global Health Sciences Fund (Formerly Gartmore GVIT Global Health Sciences Fund) | FOR AGAINST ABSTAIN TOTAL | 4,722,963.678 shares 157,979.030 shares 207,642.222 shares 5,088,584.930 shares | 92.815% 3.104% 4.081% | |||
Nationwide NVIT Global Technology and Communications Fund (Formerly Gartmore GVIT Global Technology and Communications Fund) | FOR AGAINST ABSTAIN TOTAL | 8,585,472.039 shares 102,267.977 shares 489,577.634 shares 9,177,317.650 shares | 93.551% 1.114% 5.335% | |||
Gartmore NVIT Global Utilities Fund (Formerly Gartmore GVIT Global Utilities Fund) | FOR AGAINST ABSTAIN TOTAL | 4,123,270.549 shares 122,001.533 shares 240,276.088 shares 4,485,548.170 shares | 91.923% 2.720% 5.357% | |||
Nationwide NVIT Government Bond Fund (Formerly Gartmore GVIT Government Bond Fund) | FOR AGAINST ABSTAIN TOTAL | 88,471,567.462 shares 1,825,645.181 shares 5,841,990.727 shares 96,139,203.370 shares | 92.024% 1.899% 6.077% |
Number of Shares | ||||||
Fund | Cast/Not Cast | Percentages | ||||
Nationwide NVIT Growth Fund (Formerly Gartmore GVIT Growth Fund) | FOR AGAINST ABSTAIN TOTAL | 14,931,435.904 shares 409,826.402 shares 1,259,945.064 shares 16,601,207.370 shares | 89.942% 2.469% 7.589% | |||
Gartmore NVIT International Growth Fund (Formerly Gartmore GVIT International Growth Fund) | FOR AGAINST ABSTAIN TOTAL | 6,251,419.070 shares 139,618.548 shares 290,025.592 shares 6,681,063.210 shares | 93.569% 2.090% 4.341% | |||
Nationwide NVIT Investor Destinations Aggressive Fund (Formerly Gartmore GVIT Investor Destinations Aggressive Fund) | FOR AGAINST ABSTAIN TOTAL | 49,489,224.549 shares 1,385,396.474 shares 3,696,272.337 shares 54,570,893.360 shares | 90.688% 2.539% 6.773% | |||
Nationwide NVIT Investor Destinations Conservative Fund (Formerly Gartmore GVIT Investor Destinations Conservative Fund) | FOR AGAINST ABSTAIN TOTAL | 23,091,965.887 shares 314,935,884 shares 2,292,355.179 shares 25,699,256.950 shares | 89.855% 1.225% 8.920% | |||
Nationwide NVIT Investor Destinations Moderate Fund (Formerly Gartmore GVIT Investor Destinations Moderate Fund) | FOR AGAINST ABSTAIN TOTAL | 188,902,093.059 shares 3,018,924.590 shares 16,359,690.401 shares 208,280,708.050 shares | 90.696% 1.449% 7.855% | |||
Nationwide NVIT Investor Destinations Moderately Aggressive Fund (Formerly Gartmore GVIT Investor Destinations Moderately Aggressive Fund) | FOR AGAINST ABSTAIN TOTAL | 134,792,622.920 shares 3,489,207.264 shares 9,304,197.656 shares 147,586,027.840 shares | 91.332% 2.364% 6.304% | |||
Nationwide NVIT Investor Destinations Moderately Conservative Fund (Formerly Gartmore GVIT Investor Destinations Moderately Conservative Fund) | FOR AGAINST ABSTAIN TOTAL | 49,627,123.216 shares 856,088.634 shares 3,507,215.650 shares 53,990,427.500 shares | 91.918% 1.586% 6.496% | |||
Nationwide NVIT Mid Cap Growth Fund (Formerly Gartmore GVIT Mid Cap Growth Fund) | FOR AGAINST ABSTAIN TOTAL | 10,879,584.971 shares 352,594.958 shares 717,792.971 shares 11,949,972.900 shares | 91.043% 2.950% 6.007% | |||
Nationwide NVIT Money Market Fund II (Formerly Gartmore GVIT Money Market Fund II) | FOR AGAINST ABSTAIN TOTAL | 221,774,863.241 shares 12,322,482.494 shares 16,471,740.875 shares 250,569,086.610 shares | 88.508% 4.918% 6.574% | |||
Nationwide NVIT Money Market Fund (Formerly Gartmore GVIT Money Market Fund) | FOR AGAINST ABSTAIN TOTAL | 1,578,331,008.328 shares 32,372,133.671 shares 112,652,123.301 shares 1,723,355,265.300 shares | 91.585% 1.878% 6.537% | |||
NVIT Nationwide Fund (Formerly Gartmore GVIT Nationwide Fund) | FOR AGAINST ABSTAIN TOTAL | 125,423,274.735 shares 2,767,979.467 shares 8,762,255.828 shares 136,953,510.030 shares | 91.581% 2.021% 6.398% |
Number of Shares | ||||||
Fund | Cast/Not Cast | Percentages | ||||
NVIT Nationwide Leaders Fund (Formerly Gartmore GVIT Nationwide Leaders Fund) | FOR AGAINST ABSTAIN TOTAL | 2,298,504.956 shares 29,630.469 shares 71,637.755 shares 2,399,773.180 shares | 95.780% 1.235% 2.985% | |||
Nationwide NVIT U.S. Growth Leaders Fund (Formerly Gartmore GVIT U.S. Growth Leaders Fund) | FOR AGAINST ABSTAIN TOTAL | 4,972,094.773 shares 122,623.161 shares 174,625.606 shares 5,269,343.540 shares | 94.359% 2.327% 3.314% | |||
Gartmore NVIT Worldwide Leaders Fund (Formerly Gartmore GVIT Worldwide Leaders Fund) | FOR AGAINST ABSTAIN TOTAL | 2,666,862.487 shares 47,702.491 shares 118,719.882 shares 2,833,284.860 shares | 94.126% 1.684% 4.190% | |||
JP Morgan NVIT Balanced Fund (Formerly JP Morgan GVIT Balanced Fund) | FOR AGAINST ABSTAIN TOTAL | 15,966,867.546 shares 259,004.324 shares 1,339,385.200 shares 17,565,257.070 shares | 90.900% 1.475% 7.625% | |||
Van Kampen NVIT Comstock Value Fund (Formerly Van Kampen GVIT Comstock Value Fund) | FOR AGAINST ABSTAIN TOTAL | 27,737,008.009 shares 502,564.164 shares 1,824,670.107 shares 30,064,242.280 shares | 92.259% 1.672% 6.069% | |||
Van Kampen NVIT Multi Sector Bond Fund (Formerly Van Kampen GVIT Multi Sector Bond Fund) | FOR AGAINST ABSTAIN TOTAL | 21,253,297.665 shares 484,100.920 shares 1,803,963.645 shares 23,541,362.230 shares | 90.281% 2.056% 7.663% | |||
Number of Shares | ||||||
Fund | Cast/Not Cast | Percentages | ||||
Nationwide NVIT Mid Cap Growth Fund (Formerly Gartmore GVIT Mid Cap Growth Fund) | FOR AGAINST ABSTAIN TOTAL | 10,862,827.499 shares 414,574.660 shares 672,570.741 shares 11,949,972.900 shares | 90.903% 3.469% 5.628% | |||
* | This meeting was previously adjourned on April 23, 2007. | |
** | Fund names were changed effective May 1, 2007 to reflect “Nationwide”/“NVIT” branding to coincide with the sale of Nationwide Fund Advisors, Inc. by Nationwide Corporation to its majority-owned subsidiary, Nationwide Financial Services, Inc. |
Contents | ||
6 | Statement of Investments | |
7 | Statement of Assets and Liabilities | |
8 | Statement of Operations | |
9 | Statements of Changes in Net Assets | |
11 | Financial Highlights | |
12 | Notes to Financial Statements |
SAR-NL (8/07) | ![]() |
![-s- John H. Grady](https://capedge.com/proxy/N-CSRS/0000893220-07-003038/w37711gradyjh.gif)
Beginning | Ending | |||||||||||||||||||||
Account Value, | Account Value, | Expenses Paid | Annualized | |||||||||||||||||||
NVIT Nationwide Leaders Fund | January 1, 2007 | June 30, 2007 | During Period* | Expense Ratio* | ||||||||||||||||||
Class I | Actual | $ | 1,000.00 | $ | 1,054.80 | $ | 5.45 | 1.07% | ||||||||||||||
Hypothetical | 1 | $ | 1,000.00 | $ | 1,019.49 | $ | 5.37 | 1.07% | ||||||||||||||
Class III | Actual | $ | 1,000.00 | $ | 1,054.00 | $ | 5.35 | 1.05% | ||||||||||||||
Hypothetical | 1 | $ | 1,000.00 | $ | 1,019.59 | $ | 5.27 | 1.05% | ||||||||||||||
* | Expenses are equal to the Fund’s annualized expense ratio multiplied by the average account value over the period multiplied by 181/365 (to reflect the one-half year period). The expense ratio presented represents a six-month, annualized ratio in accordance with SEC guidelines. The expenses reported above do not include the effect of additional expenses imposed by variable annuity contracts. | |
1 | Represents the hypothetical 5% return before expenses. |
Asset Allocation | ||||
Common Stock | 92.7% | |||
Repurchase Agreements | 8.4% | |||
Liabilities in excess of other assets | -1.1% | |||
100.0% |
Top Holdings* | ||||
Procter & Gamble Co. (The) | 8.3% | |||
Intel Corp. | 7.8% | |||
Microsoft Corp. | 7.0% | |||
3M Co. | 5.1% | |||
ConocoPhillips | 4.9% | |||
Johnson & Johnson | 4.7% | |||
Bank of America Corp. | 4.7% | |||
Pfizer, Inc. | 4.6% | |||
Colgate-Palmolive Co. | 4.6% | |||
Archer-Daniels Midland Co. | 4.5% | |||
Other | 43.8% | |||
100.0% |
Top Industries | ||||
Household Products | 12.9% | |||
Pharmaceuticals | 12.4% | |||
Semiconductors & Semiconductor Equipment | 10.1% | |||
Oil, Gas & Consumable Fuels | 8.9% | |||
Software | 7.0% | |||
Industrial Conglomerates | 5.0% | |||
Diversified Financial Services | 4.7% | |||
Food Products | 4.5% | |||
Multi-Utilities | 4.4% | |||
Multiline Retail | 4.2% | |||
Other | 25.9% | |||
100.0% |
* | For purpose of listing top holdings, repurchase agreements are included as part of Other. |
Common Stock (92.7%) | ||||||||
Shares or | ||||||||
Principal Amount | Value | |||||||
Beverages (3.1%) | ||||||||
Constellation Brands, Inc.* | 42,000 | $ | 1,019,760 | |||||
Chemicals (4.2%) | ||||||||
Syngenta AG ADR — CH | 35,000 | 1,362,550 | ||||||
Communications Equipment (2.1%) | ||||||||
Cisco Systems, Inc.* | 24,100 | 671,185 | ||||||
Diversified Financial Services (4.7%) | ||||||||
Bank of America Corp. | 31,300 | 1,530,257 | ||||||
Food Products (4.5%) | ||||||||
Archer-Daniels Midland Co. | 44,100 | 1,459,269 | ||||||
Household Products (12.9%) | ||||||||
Colgate-Palmolive Co. | 22,900 | 1,485,065 | ||||||
Procter & Gamble Co. (The) | 44,200 | 2,704,598 | ||||||
4,189,663 | ||||||||
Independent Power Producers & Energy Traders (3.7%) | ||||||||
Dynegy, Inc.* | 127,100 | 1,199,824 | ||||||
Industrial Conglomerate (5.0%) | ||||||||
3M Co. | 18,900 | 1,640,331 | ||||||
Multi-Utilities (4.4%) | ||||||||
Sempra Energy | 23,900 | 1,415,597 | ||||||
Multiline Retail (4.2%) | ||||||||
Macy’s, Inc. | 34,300 | 1,364,454 | ||||||
Oil, Gas & Consumable Fuels (8.9%) | ||||||||
ConocoPhillips | 20,200 | 1,585,700 | ||||||
Occidental Petroleum Corp. | 22,400 | 1,296,512 | ||||||
2,882,212 | ||||||||
Pharmaceuticals (12.4%) | ||||||||
Johnson & Johnson | 24,900 | 1,534,338 | ||||||
Pfizer, Inc. | 58,500 | 1,495,845 | ||||||
Wyeth | 17,140 | 982,808 | ||||||
4,012,991 | ||||||||
Semiconductors & Semiconductor Equipment (10.1%) | ||||||||
Intel Corp. | 106,900 | 2,539,944 | ||||||
MEMC Electronic Materials, Inc.* | 12,100 | 739,552 | ||||||
3,279,496 | ||||||||
Software (7.0%) | ||||||||
Microsoft Corp. | 76,700 | 2,260,349 | ||||||
Specialty Retail (2.2%) | ||||||||
TJX Cos., Inc. | 25,600 | 704,000 | ||||||
Wireless Telecommunication Services (3.3%) | ||||||||
Vodafone Group PLC ADR — GB | 32,170 | 1,081,877 | ||||||
Total Common Stocks (Cost $29,639,441) | 30,073,815 | |||||||
Repurchase Agreements (8.4%) | ||||||||
Nomura Securities, 5.20% dated 06/29/07, due 07/02/07, repurchase price $2,717,061, collateralized by U.S. Government Agency Mortgages with a market value of $2,770,202 | $ | 2,715,884 | 2,715,884 | |||||
Total Investments (Cost $32,355,325) (a) — 101.1% | 32,789,699 | |||||||
Liabilities in excess of other assets — (1.1)% | (345,644 | ) | ||||||
NET ASSETS — 100.0% | $ | 32,444,055 | ||||||
* | Denotes a non-income producing security. | |
(a) | See notes to financial statements for tax unrealized appreciation (depreciation) of securities. |
ADR | American Depository Receipt | |
CH | Switzerland | |
GB | United Kingdom |
NVIT Nationwide | ||||||
Leaders Fund | ||||||
Assets: | ||||||
Investments, at value (cost $29,639,441) | $ | 30,073,815 | ||||
Repurchase agreements, at cost and value | 2,715,884 | |||||
Total Investments | 32,789,699 | |||||
Interest and dividends receivable | 73,022 | |||||
Receivable for capital shares issued | 4,618 | |||||
Prepaid expenses | 361 | |||||
Total Assets | 32,867,700 | |||||
Liabilities: | ||||||
Payable for investments purchased | 327,151 | |||||
Payable for capital shares redeemed | 13,945 | |||||
Accrued expenses and other payables: | ||||||
Investment advisory fees | 68,017 | |||||
Fund administration and transfer agent fees | 1,077 | |||||
Administrative servicing fees | 1,992 | |||||
Compliance program costs | 415 | |||||
Other | 11,048 | |||||
Total Liabilities | 423,645 | |||||
Net Assets | $ | 32,444,055 | ||||
Represented by: | ||||||
Capital | $ | 30,820,615 | ||||
Accumulated net investment income | 78,829 | |||||
Accumulated net realized gains from investment transactions | 1,110,237 | |||||
Net unrealized appreciation on investments | 434,374 | |||||
Net Assets | $ | 32,444,055 | ||||
Net Assets: | ||||||
Class I Shares | $ | 3,006,729 | ||||
Class III Shares | 29,437,326 | |||||
Total | $ | 32,444,055 | ||||
Shares outstanding (unlimited number of shares authorized): | ||||||
Class I Shares | 219,547 | |||||
Class III Shares | 2,145,273 | |||||
Total | 2,364,820 | |||||
Net asset value and offering price per share (Net assets by class divided by shares outstanding by class, respectively.): | ||||||
Class I Shares | $ | 13.70 | ||||
Class III Shares | $ | 13.72 |
NVIT Nationwide | |||||
Leaders Fund | |||||
INVESTMENT INCOME: | |||||
Interest income | $ | 33,662 | |||
Dividend income | 311,203 | ||||
Total Income | 344,865 | ||||
Expenses: | |||||
Investment advisory fees | 134,251 | ||||
Fund administration and transfer agent fees | 11,346 | ||||
Administrative servicing fees Class I Shares | 2,093 | ||||
Administrative servicing fees Class III Shares | 20,915 | ||||
Custodian fees | 651 | ||||
Trustee fees | 805 | ||||
Compliance program costs (Note 3) | 256 | ||||
Printing fees | 10,820 | ||||
Other | 2,107 | ||||
Total expenses before earnings credit | 183,244 | ||||
Earnings credit (Note 6) | (301 | ) | |||
Net Expenses | 182,943 | ||||
Net Investment Income | 161,922 | ||||
REALIZED/ UNREALIZED GAINS (LOSSES) FROM INVESTMENTS: | |||||
Net realized gains on investment transactions | 1,146,311 | ||||
Net change in unrealized appreciation on investments | 513,334 | ||||
Net realized/unrealized gains (losses) on investments | 1,659,645 | ||||
CHANGE IN NET ASSETS RESULTING FROM OPERATIONS | $ | 1,821,567 | |||
NVIT Nationwide | |||||||||
Leaders Fund | |||||||||
Six Months Ended | Year Ended | ||||||||
June 30, 2007 | December 31, 2006 | ||||||||
(Unaudited) | |||||||||
From Investment Activities: | |||||||||
Operations: | |||||||||
Net investment income | $ | 161,922 | $ | 156,776 | |||||
Net realized gains on investment transactions | 1,146,311 | 4,291,531 | |||||||
Net change in unrealized appreciation/depreciation on investments | 513,334 | (505,637 | ) | ||||||
Change in net assets resulting from operations | 1,821,567 | 3,942,670 | |||||||
Distributions to shareholders from: | |||||||||
Net investment income: | |||||||||
Class I | (7,632 | ) | (14,150 | ) | |||||
Class III | (75,461 | ) | (186,218 | ) | |||||
Net realized gains: | |||||||||
Class I | (162,897 | ) | (178,468 | ) | |||||
Class III | (1,545,917 | ) | (2,368,591 | ) | |||||
Change in net assets from shareholder distributions | (1,791,907 | ) | (2,747,427 | ) | |||||
Change in net assets from capital transactions | (2,292,997 | ) | 11,744,477 | ||||||
Change in net assets | (2,263,337 | ) | 12,939,720 | ||||||
Net Assets: | |||||||||
Beginning of period | 34,707,392 | 21,767,672 | |||||||
End of period | $ | 32,444,055 | $ | 34,707,392 | |||||
Accumulated net investment income at end of period | $ | 78,829 | $ | – | |||||
CAPITAL TRANSACTIONS: | |||||||||
Class I Shares | |||||||||
Proceeds from shares issued | $ | 1,122,850 | $ | 1,716,707 | |||||
Dividends reinvested | 170,529 | 192,618 | |||||||
Cost of shares redeemed (a) | (676,427 | ) | (1,100,195 | ) | |||||
616,952 | 809,130 | ||||||||
Class III Shares | |||||||||
Proceeds from shares issued | 6,449,063 | 13,944,033 | |||||||
Dividends reinvested | 1,621,373 | 2,554,807 | |||||||
Cost of shares redeemed (a) | (10,980,385 | ) | (5,563,493 | ) | |||||
(2,909,949 | ) | 10,935,347 | |||||||
Change in net assets from capital transactions | $ | (2,292,997 | ) | $ | 11,744,477 | ||||
NVIT Nationwide | |||||||||
Leaders Fund | |||||||||
Six Months Ended | Year Ended | ||||||||
June 30, 2007 | December 31, 2006 | ||||||||
(Unaudited) | |||||||||
SHARE TRANSACTIONS: | |||||||||
Class I Shares | |||||||||
Issued | 79,545 | 128,119 | |||||||
Reinvested | 12,548 | 13,989 | |||||||
Redeemed | (48,725 | ) | (82,023 | ) | |||||
43,368 | 60,085 | ||||||||
Class III Shares | |||||||||
Issued | 455,466 | 999,718 | |||||||
Reinvested | 119,131 | 185,065 | |||||||
Redeemed | (774,412 | ) | (410,234 | ) | |||||
(199,815 | ) | 774,549 | |||||||
Total change in shares | (156,447 | ) | 834,634 | ||||||
(a) | Includes redemption fees, if any. |
Investment Activities | Distributions | |||||||||||||||||||||||||||
Net | ||||||||||||||||||||||||||||
Realized | ||||||||||||||||||||||||||||
and | ||||||||||||||||||||||||||||
Net Asset | Unrealized | Total | ||||||||||||||||||||||||||
Value, | Net | Gains | from | Net | Net | |||||||||||||||||||||||
Beginning | Investment | (Losses) on | Investment | Investment | Realized | Total | ||||||||||||||||||||||
of Period | Income | Investments | Activities | Income | Gains | Distributions | ||||||||||||||||||||||
Class I Shares | ||||||||||||||||||||||||||||
Period ended December 31, 2002 (e) | $ | 11.20 | 0.03 | (1.75 | ) | (1.72 | ) | (0.06 | ) | – | (0.06 | ) | ||||||||||||||||
For the year ended December 31, 2003 | $ | 9.44 | 0.01 | 2.37 | 2.38 | (0.02 | ) | – | (0.02 | ) | ||||||||||||||||||
For the year ended December 31, 2004 | $ | 11.81 | 0.06 | 2.15 | 2.21 | (0.05 | ) | (0.20 | ) | (0.25 | ) | |||||||||||||||||
For the year ended December 31, 2005 | $ | 13.78 | 0.15 | 1.21 | 1.36 | (0.17 | ) | (2.08 | ) | (2.25 | ) | |||||||||||||||||
For the year ended December 31, 2006 | $ | 12.89 | 0.10 | 1.96 | 2.06 | (0.12 | ) | (1.09 | ) | (1.21 | ) | |||||||||||||||||
For the six months ended June 30, 2007 (Unaudited) | $ | 13.74 | 0.07 | 0.68 | 0.75 | (0.04 | ) | (0.75 | ) | (0.79 | ) | |||||||||||||||||
Class III Shares | ||||||||||||||||||||||||||||
For the year ended December 31, 2002 | $ | 10.08 | 0.04 | (0.64 | ) | (0.60 | ) | (0.06 | ) | – | (0.06 | ) | ||||||||||||||||
For the year ended December 31, 2003 | $ | 9.44 | 0.01 | 2.39 | 2.40 | (0.02 | ) | – | (0.02 | ) | ||||||||||||||||||
For the year ended December 31, 2004 | $ | 11.83 | 0.06 | 2.15 | 2.21 | (0.05 | ) | (0.20 | ) | (0.25 | ) | |||||||||||||||||
For the year ended December 31, 2005 | $ | 13.80 | 0.16 | 1.20 | 1.36 | (0.17 | ) | (2.08 | ) | (2.25 | ) | |||||||||||||||||
For the year ended December 31, 2006 | $ | 12.91 | 0.10 | 1.97 | 2.07 | (0.12 | ) | (1.09 | ) | (1.21 | ) | |||||||||||||||||
For the six months ended June 30, 2007 (Unaudited) | $ | 13.77 | 0.07 | 0.67 | 0.74 | (0.04 | ) | (0.75 | ) | (0.79 | ) |
[Additional columns below]
[Continued from above table, first column(s) repeated]
Ratios/Supplemental Data | ||||||||||||||||||||||||||||||||||||||
Ratio of Net | ||||||||||||||||||||||||||||||||||||||
Ratio of | Investment | |||||||||||||||||||||||||||||||||||||
Ratio of | Expenses | Income | ||||||||||||||||||||||||||||||||||||
Paid-in | Net | (Prior to | (Prior to | |||||||||||||||||||||||||||||||||||
Capital | Net Assets | Ratio of | Investment | Reimbursements) | Reimbursements) | |||||||||||||||||||||||||||||||||
from | Net Asset | at End of | Expenses to | Income to | to Average | to Average | ||||||||||||||||||||||||||||||||
Redemption | Value, End | Total | Period | Average Net | Average Net | Net Assets | Net Assets | Portfolio | ||||||||||||||||||||||||||||||
Fees | of Period | Return (a) | (000s) | Assets (b) | Assets (b) | (b)(c) | (b)(c) | Turnover (d) | ||||||||||||||||||||||||||||||
Class I Shares | ||||||||||||||||||||||||||||||||||||||
Period ended December 31, 2002 (e) | 0.02 | $ | 9.44 | (15.17% | ) | $ | 247 | 1.12% | 1.03% | (f) | (f) | 105.28% | ||||||||||||||||||||||||||
For the year ended December 31, 2003 | 0.01 | $ | 11.81 | 25.38% | $ | 530 | 1.14% | 0.05% | (f) | (f) | 244.94% | |||||||||||||||||||||||||||
For the year ended December 31, 2004 | 0.01 | $ | 13.78 | 18.79% | $ | 927 | 1.19% | 0.55% | (f) | (f) | 259.37% | |||||||||||||||||||||||||||
For the year ended December 31, 2005 | – | $ | 12.89 | 10.31% | $ | 1,496 | 1.16% | 1.18% | (f) | (f) | 483.17% | |||||||||||||||||||||||||||
For the year ended December 31, 2006 | – | $ | 13.74 | 16.05% | $ | 2,421 | 1.12% | 0.55% | (f) | (f) | 671.16% | |||||||||||||||||||||||||||
For the six months ended June 30, 2007 (Unaudited) | – | $ | 13.70 | 5.48% | $ | 3,007 | 1.07% | 0.96% | 1.07% | 0.96% | 404.98% | |||||||||||||||||||||||||||
Class III Shares | ||||||||||||||||||||||||||||||||||||||
For the year ended December 31, 2002 | 0.02 | $ | 9.44 | (5.78% | ) | $ | 8,463 | 1.15% | 0.80% | 1.16% | 0.79% | 105.28% | ||||||||||||||||||||||||||
For the year ended December 31, 2003 | 0.01 | $ | 11.83 | 25.59% | $ | 8,801 | 1.13% | 0.16% | (f) | (f) | 244.94% | |||||||||||||||||||||||||||
For the year ended December 31, 2004 | 0.01 | $ | 13.80 | 18.77% | $ | 9,617 | 1.17% | 0.48% | (f) | (f) | 259.37% | |||||||||||||||||||||||||||
For the year ended December 31, 2005 | – | $ | 12.91 | 10.30% | $ | 20,271 | 1.16% | 1.26% | (f) | (f) | 483.17% | |||||||||||||||||||||||||||
For the year ended December 31, 2006 | – | $ | 13.77 | 16.12% | $ | 32,286 | 1.10% | 0.63% | (f) | (f) | 671.16% | |||||||||||||||||||||||||||
For the six months ended June 30, 2007 (Unaudited) | – | $ | 13.72 | 5.40% | $ | 29,437 | 1.05% | 0.93% | 1.06% | 0.93% | 404.98% |
(a) | Not annualized for periods less than one year. | |
(b) | Annualized for periods less than one year. | |
(c) | During the period, certain fees were waived and/or reimbursed. If such waivers/reimbursements had not occurred, the ratios would have been as indicated. | |
(d) | Portfolio turnover is calculated on the basis of the Fund as a whole without distinguishing among the classes of shares. | |
(e) | For the period from May 9, 2002 (recommencement of operations) through December 31, 2002. | |
(f) | There were no fee reductions during the period. |
(a) | Security Valuation |
Securities for which market quotations are readily available are valued at current market value as of “Valuation Time.” Valuation Time is as of the close of regular trading on the New York Stock Exchange (usually 4 p.m. Eastern time). Equity securities are valued at the last quoted sale price or, if there is no sale price, the last quoted bid price provided by an independent pricing service approved by the Trust’s Board of Trustees (“Board of Trustees”). Securities traded on NASDAQ are valued at the NASDAQ official closing price. Prices are taken from the primary market or exchange in which each security trades. | |
Most securities listed on a foreign exchange are valued either at fair value (see description below) or at the last sale price at the close of the exchange on which the security is principally traded. Foreign securities, currencies, and other assets and liabilities denominated in foreign currencies are translated into U.S. dollars at the exchange rate of said currencies against the U.S. dollar, as of Valuation Time, as provided by an independent pricing service approved by the Board of Trustees. | |
Securities for which market quotations are not readily available, or for which an independent pricing service does not provide a value or provides a value that does not represent fair value in the judgment of the Fund’s investment adviser or designee, are valued at fair value under procedures approved by the Board of Trustees. The “Fair Value” of these securities is determined in good faith by taking into account relevant factors and surrounding circumstances. Methods utilized to obtain a “Fair Value” may include the following non-exclusive list of acceptable methods: (i) a multiple of earnings; (ii) the discount from market value of a similar, freely traded security; (iii) the yield-to-maturity for debt issues; or (iv) a consolidation of the methods. The Trust’s Valuation & Operations Committee considers a non-exclusive list of factors to arrive at the appropriate method of determining “Fair Value.” For example, fair value determinations are required for securities whose value is affected by a “significant” event that materially affects the value of a domestic or foreign security which occurs subsequent to the time of the close of the principal market on which such domestic or foreign security trades and before the Valuation Time (i.e., a “subsequent event”). Typically, |
this will involve events occurring after the close of a foreign market on which a security trades and before the next Valuation Time. | |
The Fund values foreign securities at fair value in the circumstances described below. Generally, trading in foreign securities markets is completed each day at various times prior to the Valuation Time. Due to the time differences between the closings of the relevant foreign securities exchanges and the Valuation Time for the Fund, the Fund will fair value its foreign investments when it is determined that the market quotations for the foreign investments either are not readily available or are unreliable and, therefore, do not represent fair value. When the fair value prices are utilized, these prices will attempt to reflect the impact of the U.S. financial markets’ perceptions and trading activities on the Fund’s foreign investments since the last closing prices of the foreign investments were calculated on their primary foreign securities markets or exchanges. For these purposes, the Board of Trustees has determined that movements in relevant indices or other appropriate market indicators, after the close of the foreign securities exchanges, may demonstrate that market quotations are unreliable, and may trigger fair value pricing for certain securities. Consequently, fair valuation of portfolio securities may occur on a daily basis. |
(b) | Repurchase Agreements |
The Fund may enter into repurchase agreements with an entity which is a member of the Federal Reserve System or which is a “primary dealer” (as designated by the Federal Reserve Bank of New York) in U.S. Government obligations. The repurchase price generally equals the price paid by the Fund plus interest negotiated on the basis of current short-term rates, which may be more or less than the rate on the underlying portfolio securities. The seller under a repurchase agreement is required to maintain the value of the collateral held pursuant to the agreement at a market value equal to or greater than the repurchase price (including accrued interest). Collateral subject to repurchase agreements is held by the Fund’s custodian or another qualified sub-custodian or in the Federal Reserve/ Treasury book-entry system. If the counterparty defaults and the fair value of the collateral declines, realization of the collateral by the Fund may be delayed or limited. The Fund may transfer uninvested cash balances into a pooled cash account. These balances are invested in one or more repurchase agreements, with the counterparty of Nomura Securities, which is fully collateralized by U.S. Government Agency Mortgages. |
(c) | Futures Contracts |
The Fund may invest in financial futures contracts (“futures contracts”) for the purpose of hedging its existing portfolio securities or securities that the Fund intends to purchase against fluctuations in value caused by changes in prevailing market interest rates or prices. Futures contracts may also be entered into for non-hedging purposes. | |
Upon entering into a futures contract, the Fund is required to pledge to the broker an amount of cash and/or other assets equal to a certain percentage of the contract amount (initial margin deposit). Subsequent payments, known as “variation margin,” are made each day, depending on the daily fluctuations in the fair value/ market value of the underlying assets. A gain or loss equal to the daily variation margin is recognized on a daily basis. Futures contracts are valued daily at their last quoted sale price. | |
A “sale” of a futures contract means the creation of a contractual obligation to deliver the securities or foreign currency called for by the contract at a fixed price at a specified time in the future. A “purchase” of a futures contract means the creation of a contractual obligation to acquire the securities or foreign currency at a fixed price at a specified time in the future. | |
Should market conditions change unexpectedly, the Fund may not achieve the anticipated benefits of the futures contracts and may realize a loss. The use of futures transactions for hedging purposes involves the risk of imperfect correlation in movements in the price of futures contracts, interest rates, and the value of the underlying hedged assets. |
(d) | Written Options Contracts |
The Fund may write options contracts. A written option obligates the Fund to deliver (written call) or to receive (written put) a specified quantity of an underlying asset at the contract amount upon exercise by the holder of the option. When the Fund writes an option, an amount equal to the premium received by the Fund is recorded as a liability and is subsequently adjusted to the current fair value of the option written. Premiums received from writing options that expire unexercised are treated by the Fund on the expiration date as realized gains from investments. The difference between the premium and the amount paid on effecting a closing purchase transaction, as a realized loss. If a call option is exercised, the premium is added to the proceeds from the sale of the underlying security or currency in determining whether the Fund has realized a gain or loss. If a put option is exercised, the premium reduces the cost basis of the securities purchased by the Fund. Options traded on an exchange are valued at the last quoted sale price, or in the absence of a sale, the bid price provided by an independent pricing service approved by the Board of Trustees. Non-exchange traded options are valued using dealer supplied quotes. The Fund as a writer of an option bears the market risk of an unfavorable change in the price of the security underlying the written option. |
(e) | Short Sales |
The Fund is authorized to engage in short-selling of portfolio securities which obligates the Fund to replace any security that the Fund has borrowed by purchasing the security at current market value sometime in the future. The Fund will incur a loss if the price of the security increases between the date of the short sale and the date on which the Fund replaces the borrowed security. The Fund generally will realize a gain if the price of the security declines between these dates. Until the Fund replaces the borrowed security, the Fund will maintain a segregated account with cash, U.S. Government securities and/or securities held long to sufficiently cover the Fund’s short position on a daily basis. Dividends declared on securities sold short are recorded as an expense on the ex-dividend date and paid to the counterparty on the dividend pay date. |
(f) | Security Transactions and Investment Income |
Security transactions are accounted for on the date the security is purchased or sold (“trade date”). Securities gains and losses are calculated on the identified cost basis. Interest income is recognized on the accrual basis and includes, where applicable, the amortization or accretion of premium or discount. Dividend income is recorded on the ex-dividend date. |
(g) | Securities Lending |
To generate additional income, the Fund may lend its portfolio securities, up to 331/3% of the Fund, to brokers, dealers and other financial institutions provided that (1) the borrower delivers cash or securities as collateral with respect to each new loan of U.S. securities, equal to at least 102% of the value of the portfolio securities loaned, and with respect to each new loan on non-U.S. securities, collateral of at least 105% of the value of the portfolio securities loaned; and (2) at all times thereafter shall require the borrower to mark-to-market the collateral on a daily basis so that the market value of such collateral does not fall below 100% of the value of securities loaned. The Fund receives payments from borrowers equivalent to the dividends and interest that would have been earned on securities loaned while simultaneously seeking to earn income on the investment of cash collateral. There may be risks of delay in recovery of the securities should the borrower of the securities fail financially. Loans will be made, however, only to borrowers deemed by the Fund’s investment adviser to be of good standing and creditworthy under guidelines established by the Board of Trustees and when, in judgment of the adviser, the consideration which can be earned currently from these securities loans justifies the attendant risks. Loans are subject to termination by the Fund or the borrower at any time, and, therefore, are not considered to be illiquid investments. JPMorgan Chase Bank serves as custodian for the securities lending program of the Fund. JPMorgan Chase Bank receives a fee based on the value of the collateral received from borrowers. The Fund did not have securities on loan as of June 30, 2007. |
(h) | Distributions to Shareholders |
The Fund’s dividends from net investment income, if any, are declared and paid quarterly. The Fund’s distributions from net realized capital gains, if any, are declared and distributed at least annually. | |
Dividends and distributions to shareholders are determined in accordance with federal income tax regulations, which may differ from GAAP. These “book/tax” differences are considered either permanent or temporary in nature. In accordance with the American Institute of Certified Public Accountants Statement of Position 93-2, permanent differences (i.e., reclassification of market discounts, foreign exchange gain/loss, paydowns, and distributions from real estate investment trusts) are reclassified within the capital accounts based on their nature for federal income tax purposes; temporary differences do not require reclassification. These reclassifications have no effect upon the net asset value of the Fund. To the extent distributions exceed current and accumulated earnings and profits for federal income tax purposes, these distributions are reported as distributions of paid-in-capital. |
(i) | Federal Income Taxes |
It is the policy of the Fund to qualify or to continue to qualify as a “regulated investment company” by complying with the provisions available to certain investment companies, as defined in Subchapter M of the U.S. Internal Revenue Code, and to make distributions of net investment income and net realized capital gains sufficient to relieve the Fund from all, or substantially all, federal income taxes. | |
As of June 30, 2007, the tax cost of securities and the breakdown of unrealized appreciation (depreciation) for the Fund was as follows: |
Net | ||||||||||||||||
Unrealized | ||||||||||||||||
Tax Cost of | Unrealized | Unrealized | Appreciation | |||||||||||||
Securities | Appreciation | Depreciation | (Depreciation) | |||||||||||||
$ | 33,246,198 | $ | 99,916 | $ | (556,415 | ) | $ | (456,499 | ) | |||||||
(j) | Allocation of Expenses, Income, and Gains and Losses |
Expenses directly attributable to the Fund are charged to the Fund. Expenses not directly attributable to the Fund are allocated proportionately among various or all funds within the Trust. The method used by the Fund for allocating income, fund level expenses, and realized and unrealized gains or losses is based on the fair value of shares outstanding relative to net assets. Under this method, each class of shares participates based on the total net asset value of that class’s shares in proportion to the total net assets of the Fund. Expenses specific to a class (such as Rule 12b-1 and administrative services fees) are charged to that class. |
Base Management Fee | Fees | |||||
Up to $500 million | 0.80% | |||||
$500 million up to $2 billion | 0.70% | |||||
$2 billion or more | 0.65% | |||||
Out or Underperformance | Change in Fees | |||||
+/- 1 percentage point | +/- 0.02% | |||||
+/- 2 percentage point | +/- 0.04% | |||||
+/- 3 percentage point | +/- 0.06% | |||||
+/- 4 percentage point | +/- 0.08% | |||||
+/- 5 percentage point | +/- 0.10% | |||||
Combined Fee Schedule* | ||||||
Up to $1 billion | 0.15% | |||||
$1 billion up to $3 billion | 0.10% | |||||
$3 billion up to $8 billion | 0.05% | |||||
$8 billion up to $10 billion | 0.04% | |||||
$10 billion up to $12 billion | 0.02% | |||||
$12 billion or more | 0.01% | |||||
* | The assets of the Nationwide NVIT Investor Destinations Aggressive Fund, the Nationwide NVIT Investor Destinations Moderately Aggressive Fund, the Nationwide NVIT Investor Destinations Moderate Fund, the Nationwide NVIT Investor Destinations Moderately Conservative Fund, and the Nationwide NVIT Investor Destinations Conservative Fund (collectively, the “Investor Destinations Funds”) are excluded from the Trust asset level amount in order to calculate this asset-based fee. The Investor Destinations Funds do not pay any part of this fee. |
Number of Portfolios | ||||||||||
Position(s) Held | in the | |||||||||
with the Trust | Principal Occupation(s) | Nationwide Fund | Other | |||||||
Name, Address | and Length of | During Past | Complex Overseen | Directorships | ||||||
and Year of Birth | Time Served1 | Five Years | by Trustee | Held by Trustee2 | ||||||
Charles E. Allen c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1948 | Trustee since July 2000 | Mr. Allen is Chairman, Chief Executive Officer and President of Graimark Realty Advisors, Inc. (real estate development, investment and asset management). | 89 | None | ||||||
Paula H.J. Cholmondeley c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1947 | Trustee since July 2000 | Ms. Cholmondeley was Vice President and General Manager of Sappi Fine Paper North America from April 2000 through December 2003. | 89 | Director of Dentsply International, Inc. (dental products), Ultralife Batteries, Inc., Terex Corporation (construction equipment), Minerals Technology, Inc. (specialty chemicals) and Albany International Corp. (paper industry) | ||||||
C. Brent DeVore3 c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1940 | Trustee since 1990 | Dr. DeVore is President of Otterbein College. | 89 | None | ||||||
Phyllis Kay Dryden c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1947 | Trustee since December 2004 | Ms. Dryden was a partner of Mitchell Madison, a management consulting company from January 2006 until December 2006; she is currently a consultant with the company. Ms. Dryden was formerly Managing Partner of march FIRST, a global management consulting firm. | 89 | None | ||||||
Barbara L. Hennigar c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1935 | Trustee since July 2000 | Retired. | 89 | None | ||||||
Number of Portfolios | ||||||||||
Position(s) Held | in the | |||||||||
with the Trust | Principal Occupation(s) | Nationwide Fund | Other | |||||||
Name, Address | and Length of | During Past | Complex Overseen | Directorships | ||||||
and Year of Birth | Time Served1 | Five Years | by Trustee | Held by Trustee2 | ||||||
Barbara I. Jacobs c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1950 | Trustee since December 2004 | Ms. Jacobs served as Chairman of the Board of Directors of KICAP Network Fund, a European (United Kingdom) hedge fund, from January 2001 through January 2006. From 1998-2003, Ms. Jacobs was also a Managing Director and European Portfolio Manager of CREF Investments (Teachers Insurance and Annuity Association-College Retirement Equities Fund). | 89 | None | ||||||
Douglas F. Kridler c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1955 | Trustee since September 1997 | Mr. Kridler has served as the President and Chief Executive Officer of the Columbus Foundation (a Columbus, OH-based foundation which manages over 1,300 individual endowment funds) since February 2002. Prior to January 31, 2002, Mr. Kridler was the President of the Columbus Association for the Performing Arts and Chairman of the Greater Columbus Convention and Visitors Bureau. | 89 | None | ||||||
Michael D. McCarthy c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1947 | Trustee since December 2004 | Retired. Mr. McCarthy was Chairman of VMAC (commodity swaps) from October 2002 until January 2007; and a partner of Pineville Properties LLC (a commercial real estate development firm) from September 2000 until January 2007. | 89 | None | ||||||
David C. Wetmore c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1948 | Trustee since 1995 and Chairman since February 2005 | Retired. | 89 | None | ||||||
1 | Length of time served includes time served with the Trust’s predecessors. | |
2 | Directorships held in (1) any other investment companies registered under the 1940 Act, (2) any company with a class of securities registered pursuant to Section 12 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or (3) any company subject to the requirements of Section 15(d) of the Exchange Act. | |
3 | Mr. DeVore has served as President of Otterbein College since 1984. Mark Thresher, President and Chief Operating Officer of Nationwide Financial Services, Inc. (“NFS”) has served as a member of the Board of Trustees of Otterbein College since 2000, currently serves as one of 30 of its trustees, and is currently one of two Vice Chairmen of the Board. Each of Nationwide Fund Advisors (“NFA”), the Funds’ investment adviser, and Nationwide Fund Distributors LLC (“NFD”), principal underwriter to the Trust, is a wholly-owned subsidiary of NFS. | |
Additional information regarding the Trustees and Officers may be found in the Trust’s Statement of Additional Information, which is available without charge upon request, by calling 800-848-0920. |
Number of Portfolios | ||||||||||
Position(s) Held | in the | |||||||||
with the Trust | Principal Occupation(s) | Nationwide Fund | Other | |||||||
Name, Address | and Length of | During Past | Complex Overseen | Directorships | ||||||
and Year of Birth | Time Served1 | 5 Years | by Trustee | Held by Trustee 2 | ||||||
Arden L. Shisler c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1941 | Trustee since February 2000 | Retired. Mr. Shisler is the former President and Chief Executive Officer of KeB Transport, Inc., a trucking firm (2000 through 2002). He served as a consultant to KeB from January 2003 through December 2004. Since 1992, Mr. Shisler has also been Chairman of the Board for Nationwide Mutual Insurance Company.3 | 89 | Director of Nationwide Financial Services, Inc., Chairman of Nationwide Mutual Insurance Company3 | ||||||
John H. Grady Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1961 | President & Chief Executive Officer since December 2006 | Mr. Grady is President, and Chief Executive Officer of Nationwide Funds Group which includes Nationwide Fund Advisors,3 Nationwide Fund Management LLC,3 Nationwide Fund Distributors LLC 3 and NWD Investments,2 the asset management operations of Nationwide Mutual Insurance Company, which includes Morley Capital Management, Inc.,2 Nationwide Separate Accounts LLC,2 NorthPointe Capital LLC,2 and Nationwide SA Capital Trust2. From March 2004 until March 2006, Mr. Grady was Chief Executive Officer of Constellation Investment Management Co., L.P. (registered investment adviser), and President and Chief Executive Officer of Constellation Funds Group (registered investment companies). He also was President of Constellation Investment Distribution Co., Inc. (registered broker-dealer) from March 2004 until June 2006. From February 2001 until February 2004, Mr. Grady was Chief Operating and Chief Legal Officer; Managing Director, Mutual Funds Group, Turner Investment Partners, Inc. (registered investment adviser); Executive Vice President of Turner Funds and Turner Institutional Portfolios (registered investment companies); and President, Turner Investment Distributors, Inc. (registered broker-dealer). | N/A | None | ||||||
Gerald J. Holland Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1951 | Treasurer since March 2001 | Mr. Holland is Senior Vice President—Operations for Nationwide Funds Group3. | N/A | N/A | ||||||
Number of Portfolios | ||||||||||
Position(s) Held | in the | |||||||||
with the Trust | Principal Occupation(s) | Nationwide Fund | Other | |||||||
Name, Address | and Length of | During Past | Complex Overseen | Directorships | ||||||
and Year of Birth | Time Served1 | 5 Years | by Trustee | Held by Trustee 2 | ||||||
Michael A. Krulikowski Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1959 | Chief Compliance Officer from June 2004 to August 20074 | Mr. Krulikowski is Vice President and Chief Compliance Officer of Nationwide Funds Group3, Morley Capital Management, Inc.3, Nationwide SA Capital Trust (since 1999)3, and Nationwide Separate Accounts LLC (since August 2005).3 Since June 2004, Mr. Krulikowski has also served as Chief Compliance Officer of the Trust. From November 1999 through May 2007, he served as Vice President and Chief Compliance Officer of NorthPointe Capital LLC. 3 | N/A | N/A | ||||||
Eric E. Miller Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1953 | Secretary since December 2002 | Mr. Miller is Senior Vice President, General Counsel, and Assistant Secretary for Nationwide Funds Group3 and NWD Investments.2 From August 2000 to August 2002, Mr. Miller was a Partner with Stradley Ronon Stevens & Young, LLP. | N/A | N/A | ||||||
1 | Length of time served includes time served with the Trust’s predecessors. | |
2 | Directorships held in (1) any other investment companies registered under the 1940 Act, (2) any company with a class of securities registered pursuant to Section 12 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or (3) any company subject to the requirements of Section 15(d) of the Exchange Act. | |
3 | This position is held with an affiliated person or principal underwriter of the Trust. | |
4 | Effective August 3, 2007, the Board of Trustees approved Carol Baldwin Moody as Chief Compliance Officer of the Trust. Since November 2005, Ms. Moody has been Senior Vice President, Chief Compliance Officer of Nationwide Financial Services, Nationwide Life Insurance Company, Nationwide Life and Annuity Insurance Company, and Nationwide Investment Advisors, LLC. From February 2004-November 2005, she was Chief Compliance Officer of TIAA-CREF and from April 2000-February 2004, she was Managing Director and General Counsel, TCW/ Latin America Partners, LLC and Baeza & Co., LLC. | |
Federal law requires the Trust, each of its investment advisers and sub-advisers to adopt procedures for voting proxies (“Proxy Voting Guidelines”) and to provide a summary of those Proxy Voting Guidelines used to vote the securities held by the Funds. The Funds’ proxy voting policies and procedures are available without charge (i) upon request, by calling 800-848-0920, (ii) on the Funds’ website at www.nationwidefunds.com, or (iii) on the Securities and Exchange Commission’s website at www.sec.gov. |
(i) | General Information Regarding the Board’s Review of Investment Advisory Agreements |
(ii) | Board Conclusions Regarding the Fund’s Advisory Agreement |
Number of Shares | ||||||
Fund | Cast/Not Cast | Percentages | ||||
Federated NVIT High Income Bond Fund (Formerly Federated GVIT High Income Bond Fund) | FOR AGAINST ABSTAIN TOTAL | 30,051,703.188 shares 618,245.021 shares 1,813,550.431 shares 32,483,498.640 shares | 92.514% 1.903% 5.583% | |||
NVIT International Index Fund (Formerly GVIT International Index Fund) | FOR AGAINST ABSTAIN TOTAL | 4,322,203.982 shares 2,758.318 shares 135,636.840 shares 4,460,599.140 shares | 96.897% 0.062% 3.041% | |||
NVIT International Value Fund (Formerly GVIT International Value Fund) | FOR AGAINST ABSTAIN TOTAL | 20,032,843.199 shares 333,588.902 shares 1,093,293.879 shares 21,459,725.980 shares | 93.351% 1.554% 5.095% | |||
NVIT Mid Cap Index Fund (Formerly GVIT Mid Cap Index Fund) | FOR AGAINST ABSTAIN TOTAL | 35,380,179.120 shares 631,117.844 shares 1,565,714.306 shares 37,577,011.270 shares | 94.154% 1.679% 4.167% |
Number of Shares | ||||||
Fund | Cast/Not Cast | Percentages | ||||
NVIT S&P 500 Index Fund (Formerly GVIT S&P 500 Index Fund) | FOR AGAINST ABSTAIN TOTAL | 56,119,814.230 shares 666,195.542 shares 1,944,898.888 shares 58,730,908.660 shares | 95.554% 1.134% 3.312% | |||
Nationwide Multi-Manager NVIT Small Cap Growth Fund (Formerly GVIT Small Cap Growth Fund) | FOR AGAINST ABSTAIN TOTAL | 7,632,918.513 shares 149,458.111 shares 451,583.036 shares 8,233,959.660 shares | 92.700% 1.816% 5.484% | |||
Nationwide Multi-Manager NVIT Small Cap Value Fund (Formerly GVIT Small Cap Value Fund) | FOR AGAINST ABSTAIN TOTAL | 48,649,396.525 shares 979,183.753 shares 2,786,133.102 shares 52,414,713.380 shares | 92.816% 1.868% 5.316% | |||
Nationwide Multi-Manager NVIT Small Company Fund (Formerly GVIT Small Company Fund) | FOR AGAINST ABSTAIN TOTAL | 29,903,181.700 shares 838,774.923 shares 2,006,741.307 shares 32,748,697.930 shares | 91.311% 2.561% 6.128% | |||
Gartmore NVIT Developing Markets Fund (Formerly Gartmore GVIT Developing Markets Fund) | FOR AGAINST ABSTAIN TOTAL | 21,0177,889.443 shares 424,272.958 shares 1,543,850.729 shares 23,046,013.130 shares | 91.460% 1.841% 6.699% | |||
Gartmore NVIT Emerging Markets Fund (Formerly Gartmore GVIT Emerging Markets Fund) | FOR AGAINST ABSTAIN TOTAL | 17,050,534.593 shares 526,574.722 shares 881,608.905 shares 18,458,718.220 shares | 92.371% 2.853% 4.776% | |||
Nationwide NVIT Global Financial Services Fund (Formerly Gartmore GVIT Global Financial Services Fund) | FOR AGAINST ABSTAIN TOTAL | 1,554,847.333 shares 19,539.033 shares 52,206.494 shares 1,626,592.860 shares | 95.589% 1.201% 3.210% | |||
Nationwide NVIT Global Health Sciences Fund (Formerly Gartmore GVIT Global Health Sciences Fund) | FOR AGAINST ABSTAIN TOTAL | 4,722,963.678 shares 157,979.030 shares 207,642.222 shares 5,088,584.930 shares | 92.815% 3.104% 4.081% | |||
Nationwide NVIT Global Technology and Communications Fund (Formerly Gartmore GVIT Global Technology and Communications Fund) | FOR AGAINST ABSTAIN TOTAL | 8,585,472.039 shares 102,267.977 shares 489,577.634 shares 9,177,317.650 shares | 93.551% 1.114% 5.335% | |||
Gartmore NVIT Global Utilities Fund (Formerly Gartmore GVIT Global Utilities Fund) | FOR AGAINST ABSTAIN TOTAL | 4,123,270.549 shares 122,001.533 shares 240,276.088 shares 4,485,548.170 shares | 91.923% 2.720% 5.357% | |||
Nationwide NVIT Government Bond Fund (Formerly Gartmore GVIT Government Bond Fund) | FOR AGAINST ABSTAIN TOTAL | 88,471,567.462 shares 1,825,645.181 shares 5,841,990.727 shares 96,139,203.370 shares | 92.024% 1.899% 6.077% |
Number of Shares | ||||||
Fund | Cast/Not Cast | Percentages | ||||
Nationwide NVIT Growth Fund (Formerly Gartmore GVIT Growth Fund) | FOR AGAINST ABSTAIN TOTAL | 14,931,435.904 shares 409,826.402 shares 1,259,945.064 shares 16,601,207.370 shares | 89.942% 2.469% 7.589% | |||
Gartmore NVIT International Growth Fund (Formerly Gartmore GVIT International Growth Fund) | FOR AGAINST ABSTAIN TOTAL | 6,251,419.070 shares 139,618.548 shares 290,025.592 shares 6,681,063.210 shares | 93.569% 2.090% 4.341% | |||
Nationwide NVIT Investor Destinations Aggressive Fund (Formerly Gartmore GVIT Investor Destinations Aggressive Fund) | FOR AGAINST ABSTAIN TOTAL | 49,489,224.549 shares 1,385,396.474 shares 3,696,272.337 shares 54,570,893.360 shares | 90.688% 2.539% 6.773% | |||
Nationwide NVIT Investor Destinations Conservative Fund (Formerly Gartmore GVIT Investor Destinations Conservative Fund) | FOR AGAINST ABSTAIN TOTAL | 23,091,965.887 shares 314,935,884 shares 2,292,355.179 shares 25,699,256.950 shares | 89.855% 1.225% 8.920% | |||
Nationwide NVIT Investor Destinations Moderate Fund (Formerly Gartmore GVIT Investor Destinations Moderate Fund) | FOR AGAINST ABSTAIN TOTAL | 188,902,093.059 shares 3,018,924.590 shares 16,359,690.401 shares 208,280,708.050 shares | 90.696% 1.449% 7.855% | |||
Nationwide NVIT Investor Destinations Moderately Aggressive Fund (Formerly Gartmore GVIT Investor Destinations Moderately Aggressive Fund) | FOR AGAINST ABSTAIN TOTAL | 134,792,622.920 shares 3,489,207.264 shares 9,304,197.656 shares 147,586,027.840 shares | 91.332% 2.364% 6.304% | |||
Nationwide NVIT Investor Destinations Moderately Conservative Fund (Formerly Gartmore GVIT Investor Destinations Moderately Conservative Fund) | FOR AGAINST ABSTAIN TOTAL | 49,627,123.216 shares 856,088.634 shares 3,507,215.650 shares 53,990,427.500 shares | 91.918% 1.586% 6.496% | |||
Nationwide NVIT Mid Cap Growth Fund (Formerly Gartmore GVIT Mid Cap Growth Fund) | FOR AGAINST ABSTAIN TOTAL | 10,879,584.971 shares 352,594.958 shares 717,792.971 shares 11,949,972.900 shares | 91.043% 2.950% 6.007% | |||
Nationwide NVIT Money Market Fund II (Formerly Gartmore GVIT Money Market Fund II) | FOR AGAINST ABSTAIN TOTAL | 221,774,863.241 shares 12,322,482.494 shares 16,471,740.875 shares 250,569,086.610 shares | 88.508% 4.918% 6.574% | |||
Nationwide NVIT Money Market Fund (Formerly Gartmore GVIT Money Market Fund) | FOR AGAINST ABSTAIN TOTAL | 1,578,331,008.328 shares 32,372,133.671 shares 112,652,123.301 shares 1,723,355,265.300 shares | 91.585% 1.878% 6.537% | |||
NVIT Nationwide Fund (Formerly Gartmore GVIT Nationwide Fund) | FOR AGAINST ABSTAIN TOTAL | 125,423,274.735 shares 2,767,979.467 shares 8,762,255.828 shares 136,953,510.030 shares | 91.581% 2.021% 6.398% |
Number of Shares | ||||||
Fund | Cast/Not Cast | Percentages | ||||
NVIT Nationwide Leaders Fund (Formerly Gartmore GVIT Nationwide Leaders Fund) | FOR AGAINST ABSTAIN TOTAL | 2,298,504.956 shares 29,630.469 shares 71,637.755 shares 2,399,773.180 shares | 95.780% 1.235% 2.985% | |||
Nationwide NVIT U.S. Growth Leaders Fund (Formerly Gartmore GVIT U.S. Growth Leaders Fund) | FOR AGAINST ABSTAIN TOTAL | 4,972,094.773 shares 122,623.161 shares 174,625.606 shares 5,269,343.540 shares | 94.359% 2.327% 3.314% | |||
Gartmore NVIT Worldwide Leaders Fund (Formerly Gartmore GVIT Worldwide Leaders Fund) | FOR AGAINST ABSTAIN TOTAL | 2,666,862.487 shares 47,702.491 shares 118,719.882 shares 2,833,284.860 shares | 94.126% 1.684% 4.190% | |||
JP Morgan NVIT Balanced Fund (Formerly JP Morgan GVIT Balanced Fund) | FOR AGAINST ABSTAIN TOTAL | 15,966,867.546 shares 259,004.324 shares 1,339,385.200 shares 17,565,257.070 shares | 90.900% 1.475% 7.625% | |||
Van Kampen NVIT Comstock Value Fund (Formerly Van Kampen GVIT Comstock Value Fund) | FOR AGAINST ABSTAIN TOTAL | 27,737,008.009 shares 502,564.164 shares 1,824,670.107 shares 30,064,242.280 shares | 92.259% 1.672% 6.069% | |||
Van Kampen NVIT Multi Sector Bond Fund (Formerly Van Kampen GVIT Multi Sector Bond Fund) | FOR AGAINST ABSTAIN TOTAL | 21,253,297.665 shares 484,100.920 shares 1,803,963.645 shares 23,541,362.230 shares | 90.281% 2.056% 7.663% | |||
Number of Shares | ||||||
Fund | Cast/Not Cast | Percentages | ||||
Nationwide NVIT Mid Cap Growth Fund (Formerly Gartmore GVIT Mid Cap Growth Fund) | FOR AGAINST ABSTAIN TOTAL | 10,862,827.499 shares 414,574.660 shares 672,570.741 shares 11,949,972.900 shares | 90.903% 3.469% 5.628% | |||
* | This meeting was previously adjourned on April 23, 2007. | |
** | Fund names were changed effective May 1, 2007 to reflect “Nationwide”/“NVIT” branding to coincide with the sale of Nationwide Fund Advisors, Inc. by Nationwide Corporation to its majority-owned subsidiary, Nationwide Financial Services, Inc. |
June 30, 2007 (Unaudited)
Contents | ||
6 | Statement of Investments | |
7 | Statement of Assets and Liabilities | |
8 | Statement of Operations | |
9 | Statements of Changes in Net Assets | |
11 | Financial Highlights | |
12 | Notes to Financial Statements |
Statement Regarding Availability of Proxy Voting Record.
SAR-IDA (8/07) | ![]() |
Dear Fellow Shareholder:
Since I last wrote to you, our mutual funds have enjoyed another period of solid performance, and the corporate realignment that was in progress is now finished.
On May 1, 2007, Nationwide Financial Services, Inc. (NFS), completed its acquisition of the Philadelphia-based retail mutual fund operations of NWD Investment Management, Inc. (formerly, “Gartmore Global Investments, Inc.”), from Nationwide Corporation, a subsidiary of Nationwide Mutual Insurance Company. Effective that date, the acquired entities were renamed Nationwide Funds Group (NFG), and the Gartmore Funds were renamed the Nationwide Funds to better align with the Nationwide® brand. Although the corporate ownership and fund names have changed, I can assure you that NFG intends to maintain as much continuity as possible with the Funds and key personnel.
Thank you, shareholders, for approving the new investment advisory agreement that was required due to the change in corporate ownership. The new agreement is identical in all material respects to the original agreement that it replaces, with the exception of the section pertaining to the vote by the shareholders of the NVIT Mid Cap Growth Fund to approve NorthPointe Capital®, LLC (NorthPointe) as sub-adviser to that particular Fund.
Market Overview: January 1-June 30, 2007
Share prices in general were buoyed in part by better-than-expected first-quarter 2007 earnings and a flurry of mergers and acquisitions, many of these spurred by readily available funding from private equity firms. In June, investors grew more cautious amid surging crude oil prices, a sudden spike in long-term interest rates, and the meltdown of two hedge funds that had exposure to the subprime mortgage market. Looking abroad, a weak U.S. dollar aided foreign stocks, as reflected in the 11.09% advance of the Morgan Stanley Capital International Europe, Australasia and Far East (MSCI EAFE®) Index. Emerging market performance was particularly robust.
The bond market struggled during the first half of 2007. While short-term interest rates remained stable, reflecting the Federal Reserve Board’s decision in June to leave the target federal funds rate at 5.25%, longer-term rates climbed during the first half of 2007, depressing bond prices and forcing the Lehman Brothers® U.S. Aggregate Index to settle for a modest 0.97% return.
We at NFG thank you for your understanding and cooperation throughout our recent transition period. We emerge from this period energized for the future, and we look forward to serving your investment needs for a long time to come.
Nationwide Funds Group
PAST PERFORMANCE IS NO GUARANTEE OF FUTURE RESULTS.
Nationwide Funds are advised by Nationwide Fund Advisors (NFA). NFA is a wholly-owned subsidiary of Nationwide Financial Services. Nationwide Financial Services is a wholly-owned subsidiary of Nationwide Corporation. All of the common stock of Nationwide Corporation is held by Nationwide Mutual (95.2%) and Nationwide Mutual Fire Insurance Company (4.8%), each of which is a mutual company owned by its policyholders.
Nationwide Funds Group (NFG) is the mutual fund arm of Nationwide Financial Services (NYSE: NFS). Based in Conshohocken, Pa., a suburb of Philadelphia, NFG is comprised of Nationwide Fund Advisors, Nationwide Fund Distributors, LLC, and Nationwide Fund Management, LLC. Together, these provide advisory, distribution, and administration services respectively to the Nationwide Funds, and manage more than $43.5 billion in assets as of June 30, 2007, of which more than $12 billion are in “fund of funds” designed to provide asset allocation across several types of investments and asset classes.
Lehman Brothers (LB) U.S. Aggregate Index: An unmanaged, market value-weighted index of investment-grade, fixed-rate debt issues (including government, corporate, asset-backed, and mortgage-backed securities with maturities of one year or more) that is generally representative of the bond market as a whole.
Morgan Stanley Capital International Europe, Australasia and Far East (MSCI EAFE®) Index: An unmanaged, free float-adjusted, market capitalization-weighted index that is designed to measure the performance of stocks in developed markets outside the United States and Canada.
Standard & Poor’s 500® (S&P 500) Index: An unmanaged, market capitalization-weighted index of 500 widely held stocks of large-cap U.S. companies that gives a broad look at how the stock prices of those companies have performed.
Views expressed within are those of Nationwide Funds Group as of the date noted, are subject to change at any time, and may not come to pass.
This report is for informational purposes only, and is not intended as an offer or recommendation with respect to the purchase or sale of any security, option, future, or other derivatives in such securities.
Investing in mutual funds involves risk, including possible loss of principal.
Investors should carefully consider a fund’s investment objectives, risks, fees, charges, and expenses before investing any money. To obtain this and other fund information, please call 800-848-0920 to request a prospectus, or download a prospectus at www.nationwidefunds.com. Please read the prospectus carefully before investing any money.
Nationwide Funds distributed by Nationwide Fund Distributors LLC (formerly Gartmore Distribution Services, Inc.), Member NASD. 1200 River Road, Suite 1000, Conshohocken, Pa. 19428.
Shareholder | Nationwide NVIT Investor Destinations |
As a shareholder of the Fund, you incur two types of costs: (1) transaction costs, including sales charges (loads) paid on purchase payments and redemption fees; and (2) ongoing costs, including investment advisory fees, administration fees, distribution fees and other Fund expenses. The examples below are 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. Per SEC requirements, the examples assume that you had a $1,000 investment in the Class at the beginning of the reporting period, January 1, 2007, and continued to hold your shares at the end of the reporting period, June 30, 2007.
Actual Expenses
Hypothetical Example for Comparison Purposes
Please note that the expenses shown in the table are meant to highlight your ongoing costs only and do not reflect any transaction costs, such as sales charges (loads) or redemption fees. Therefore, the second line for each Class in 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 transaction costs were included, your costs would have been higher. The examples also assume all dividends and distributions have been reinvested.
Schedule of Shareholder Expenses
Nationwide NVIT Investor Destinations | ||||||||||||||||||||||
Aggressive Fund | ||||||||||||||||||||||
Beginning | Ending | Expenses Paid | Annualized | |||||||||||||||||||
Account Value, | Account | During | Expense | |||||||||||||||||||
January 1, 2007 | Value, | Period*2 | Ratio*2 | |||||||||||||||||||
June 30, 2007 | ||||||||||||||||||||||
Class II | Actual | $ | 1,000.00 | $ | 1,080.60 | $ | 2.79 | 0.54% | ||||||||||||||
Hypothetical | 1 | $ | 1,000.00 | $ | 1,022.12 | $ | 2.71 | 0.54% | ||||||||||||||
Class VI | Actual | $ | 1,000.00 | $ | 1,080.80 | $ | 2.94 | 0.57% | ||||||||||||||
Hypothetical | 1 | $ | 1,000.00 | $ | 1,021.97 | $ | 2.86 | 0.57% | ||||||||||||||
* | Expenses are equal to the Fund’s annualized expense ratio multiplied by the average account value over the period multiplied by 181/365 (to reflect the one-half year period). The expense ratio presented represents a six-month, annualized ratio in accordance with SEC guidelines. The expenses reported above do not include the effect of additional expenses imposed by variable annuity contracts. | |
1 | Represents the hypothetical 5% return before expenses. | |
2 | Expenses are based on the direct expenses of the Fund and do not include the effect of the underlying Funds’ expenses, which are disclosed in the Fee and Expense table and described more fully in a footnote to that table in your Fund prospectus. |
Portfolio Summary | Nationwide NVIT Investor Destinations Aggressive Fund |
Asset Allocation | ||||
Mutual Funds | 100.0% | |||
100.0% |
Asset Allocation Detail | ||||
Equity Funds | 95.0% | |||
Fixed Income Funds | 5.0% | |||
100.0% |
Top Holdings | ||||
NVIT S&P 500 Index Fund, ID Class | 39.9% | |||
Nationwide International Index Fund, Institutional Class | 28.9% | |||
NVIT Mid Cap Index Fund, ID Class | 15.0% | |||
NVIT Small Cap Index Fund, ID Class | 9.9% | |||
Nationwide NVIT Bond Index Fund, ID Class | 5.0% | |||
NVIT International Index Fund, ID Class | 1.3% | |||
100.0% |
Nationwide NVIT Investor Destinations Aggressive Fund
MUTUAL FUNDS (100.0%)(a) | ||||||||
Shares | Value | |||||||
Equity Funds (95.0%) | ||||||||
NVIT Small Cap Index Fund, ID Class | 7,745,976 | $ | 78,621,659 | |||||
Nationwide International Index Fund, Institutional Class | 19,258,631 | 228,792,539 | ||||||
NVIT International Index Fund, ID Class | 870,306 | 10,269,615 | ||||||
NVIT Mid Cap Index Fund, ID Class | 5,904,909 | 118,334,381 | ||||||
NVIT S&P 500 Index Fund, ID Class | 30,156,880 | 315,742,533 | ||||||
Fixed Income Funds (5.0%) | ||||||||
Nationwide NVIT Bond Index Fund, ID Class | 4,039,143 | 39,704,775 | ||||||
Total Investments (Cost $714,390,914) (b) — 100.0% | 791,465,502 | |||||||
Other assets in excess of liabilities — 0.0% | 40,649 | |||||||
NET ASSETS — 100.0% | $ | 791,506,151 | ||||||
(a) | Investment in affiliate | |
(b) | See notes to financial statements for tax unrealized appreciation (depreciation) of securities. |
See accompanying notes to financial statements.
Nationwide NVIT | ||||||
Investor | ||||||
Destinations | ||||||
Aggressive Fund | ||||||
Assets: | ||||||
Investments in affiliates, at value (cost $714,390,914) | $ | 791,465,502 | ||||
Cash | 42 | |||||
Receivable for capital shares issued | 406,276 | |||||
Prepaid expenses | 7,831 | |||||
Total Assets | 791,879,651 | |||||
Liabilities: | ||||||
Payable for capital shares redeemed | 45,167 | |||||
Accrued expenses and other payables: | ||||||
Investment advisory fees | 84,880 | |||||
Distribution fees | 163,232 | |||||
Administrative servicing fees | 25,939 | |||||
Compliance program costs | 9,470 | |||||
Other | 44,812 | |||||
Total Liabilities | 373,500 | |||||
Net Assets | $ | 791,506,151 | ||||
Represented by: | ||||||
Capital | $ | 626,967,720 | ||||
Accumulated net investment loss | (1,323,719 | ) | ||||
Accumulated net realized gains from investment transactions | 88,787,562 | |||||
Net unrealized appreciation on investments | 77,074,588 | |||||
Net Assets | $ | 791,506,151 | ||||
Net Assets: | ||||||
Class II Shares | 779,626,900 | |||||
Class VI Shares | 11,879,251 | |||||
Total | $ | 791,506,151 | ||||
Shares outstanding (unlimited number of shares authorized): | ||||||
Class II Shares | 55,690,318 | |||||
Class VI Shares | 851,759 | |||||
Total | 56,542,077 | |||||
Net asset value and offering price per share (Net assets by class divided by shares outstanding by class, respectively.):* | ||||||
Class II Shares | $ | 14.00 | ||||
Class VI Shares | $ | 13.95 | ||||
* | Not subject to a front-end sales charge. |
7
Nationwide NVIT | |||||
Investor Destinations | |||||
Aggressive Fund | |||||
INVESTMENT INCOME: | |||||
Dividend income | $ | 306,764 | |||
Dividend income from affiliates | 7,113,542 | ||||
Total Income | 7,420,306 | ||||
Expenses: | |||||
Investment advisory fees | 496,080 | ||||
Distribution fees Class II Shares | 939,359 | ||||
Distribution fees Class VI Shares | 14,651 | ||||
Administrative servicing fees Class II Shares | 493,915 | ||||
Administrative servicing fees Class VI Shares | 9,355 | ||||
Trustee fees | 17,486 | ||||
Compliance program costs (Note 3) | 5,195 | ||||
Other | 77,635 | ||||
Total expenses before earnings credit | 2,053,676 | ||||
Earnings credit (Note 6) | (73 | ) | |||
Net Expenses | 2,053,603 | ||||
Net Investment Income | 5,366,703 | ||||
REALIZED/ UNREALIZED GAINS (LOSSES) FROM INVESTMENTS: | |||||
Realized gains on investment transactions with affiliates | 80,558,357 | ||||
Realized gain distributions from underlying funds | 8,342,550 | ||||
Net realized gains on investment transactions | 88,900,907 | ||||
Net change in unrealized depreciation on investments | (35,208,122 | ) | |||
Net realized/unrealized gains (losses) on investments | 53,692,785 | ||||
CHANGE IN NET ASSETS RESULTING FROM OPERATIONS | $ | 59,059,488 | |||
8
Nationwide NVIT Investor | |||||||||
Destinations Aggressive Fund | |||||||||
Six Months Ended | Year Ended | ||||||||
June 30, 2007 | December 31, 2006 | ||||||||
(Unaudited) | |||||||||
FROM INVESTMENT ACTIVITIES: | |||||||||
Operations: | |||||||||
Net investment income | $ | 5,366,703 | $ | 10,281,100 | |||||
Net realized gains on investment transactions | 88,900,907 | 28,548,029 | |||||||
Net change in unrealized appreciation/depreciation on investment transactions | (35,208,122 | ) | 64,406,969 | ||||||
Change in net assets resulting from operations | 59,059,488 | 103,236,098 | |||||||
Distributions to shareholders from: | |||||||||
Net investment income: | |||||||||
Class II | (7,625,191 | ) | (13,328,298 | ) | |||||
Class VI | (127,628 | ) | (202,117 | ) | |||||
Net realized gains on investments: | |||||||||
Class II | (24,266,362 | ) | (9,376,448 | ) | |||||
Class VI | (371,136 | ) | (110,753 | ) | |||||
Change in net assets from shareholder distributions | (32,390,317 | ) | (23,017,616 | ) | |||||
Change in net assets from capital transactions | 25,848,979 | 73,623,124 | |||||||
Change in net assets | 52,518,150 | 153,841,606 | |||||||
Net Assets: | |||||||||
Beginning of period | 738,988,001 | 585,146,395 | |||||||
End of period | $ | 791,506,151 | $ | 738,988,001 | |||||
Accumulated net investment income (loss) at end of period | $ | (1,323,719 | ) | $ | 1,062,397 | ||||
CAPITAL TRANSACTIONS: | |||||||||
Class II Shares | |||||||||
Proceeds from shares issued | $ | 34,696,554 | $ | 84,347,700 | |||||
Dividends reinvested | 31,891,512 | 22,704,733 | |||||||
Cost of shares redeemed (a) | (40,831,480 | ) | (36,462,630 | ) | |||||
25,756,586 | 70,589,803 | ||||||||
Class VI Shares | |||||||||
Proceeds from shares issued | 1,960,219 | 8,533,521 | |||||||
Dividends reinvested | 498,763 | 312,870 | |||||||
Cost of shares redeemed (a) | (2,366,589 | ) | (5,813,070 | ) | |||||
92,393 | 3,033,321 | ||||||||
Change in net assets from capital transactions | $ | 25,848,979 | $ | 73,623,124 | |||||
SHARE TRANSACTIONS: | |||||||||
Class II Shares | |||||||||
Issued | 2,472,512 | 6,662,995 | |||||||
Reinvested | 2,285,780 | 1,809,129 | |||||||
Redeemed | (2,925,483 | ) | (2,887,780 | ) | |||||
1,832,809 | 5,584,344 | ||||||||
9
Nationwide NVIT Investor | |||||||||
Destinations Aggressive Fund | |||||||||
Six Months Ended | Year Ended | ||||||||
June 30, 2007 | December 31, 2006 | ||||||||
(Unaudited) | |||||||||
SHARE TRANSACTIONS: (continued) | |||||||||
Class VI Shares | |||||||||
Issued | 140,457 | 667,757 | |||||||
Reinvested | 35,884 | 24,781 | |||||||
Redeemed | (170,014 | ) | (457,870 | ) | |||||
6,327 | 234,668 | ||||||||
Total change in shares | 1,839,136 | 5,819,012 | |||||||
(a) | Includes redemption fees, if any. |
10
Distributions | ||||||||||||||||||||
Investment Activities | ||||||||||||||||||||
Net Realized | ||||||||||||||||||||
and | ||||||||||||||||||||
Net Asset | Unrealized | Total | ||||||||||||||||||
Value, | Net | Gains | from | Net | ||||||||||||||||
Beginning | Investment | (Losses) on | Investment | Investment | ||||||||||||||||
of Period | Income | Investments | Activities | Income | ||||||||||||||||
Class II Shares | ||||||||||||||||||||
For the year ended December 31, 2002 | $ | 10.11 | 0.09 | (1.96 | ) | (1.87 | ) | (0.09 | ) | |||||||||||
For the year ended December 31, 2003 | $ | 8.15 | 0.12 | 2.46 | 2.58 | (0.12 | ) | |||||||||||||
For the year ended December 31, 2004 (e) | $ | 10.49 | 0.17 | 1.28 | 1.45 | (0.17 | ) | |||||||||||||
For the year ended December 31, 2005 | $ | 11.52 | 0.22 | 0.68 | 0.90 | (0.22 | ) | |||||||||||||
For the year ended December 31, 2006 | $ | 11.97 | 0.20 | 1.78 | 1.98 | (0.26 | ) | |||||||||||||
For the six months ended June 30, 2007 (Unaudited) | $ | 13.51 | 0.10 | 0.98 | 1.08 | (0.14 | ) | |||||||||||||
Class VI Shares | ||||||||||||||||||||
Period ended December 31, 2004 (f) | $ | 10.52 | 0.17 | 1.15 | 1.32 | (0.17 | ) | |||||||||||||
For the year ended December 31, 2005 | $ | 11.52 | 0.23 | 0.68 | 0.91 | (0.24 | ) | |||||||||||||
For the year ended December 31, 2006 | $ | 11.96 | 0.20 | 1.77 | 1.97 | (0.28 | ) | |||||||||||||
For the six months ended June 30, 2007 (Unaudited) | $ | 13.47 | 0.10 | 0.98 | 1.08 | (0.15 | ) | |||||||||||||
[Additional columns below]
[Continued from above table, first column(s) repeated]
Distributions | ||||||||||||||||||||||||
Net Assets | Ratio of | |||||||||||||||||||||||
Net | Net Asset | at End of | Expenses | |||||||||||||||||||||
realized | Total | Value, End | Total | Period | to Average | |||||||||||||||||||
gains | Distributions | of Period | Return (a) | (000s) | Net Assets (b) | |||||||||||||||||||
Class II Shares | ||||||||||||||||||||||||
For the year ended December 31, 2002 | – | (0.09 | ) | 8.15 | (18.50% | ) | $ | 19,493 | 0.56% | |||||||||||||||
For the year ended December 31, 2003 | �� | (0.12 | ) | (0.24 | ) | 10.49 | 31.87% | $ | 94,500 | 0.55% | ||||||||||||||
For the year ended December 31, 2004 (e) | (0.25 | ) | (0.42 | ) | 11.52 | 14.03% | $ | 332,097 | 0.56% | |||||||||||||||
For the year ended December 31, 2005 | (0.23 | ) | (0.45 | ) | 11.97 | 7.93% | $ | 577,843 | 0.56% | |||||||||||||||
For the year ended December 31, 2006 | (0.18 | ) | (0.44 | ) | 13.51 | 16.87% | $ | 727,599 | 0.57% | |||||||||||||||
For the six months ended June 30, 2007 (Unaudited) | (0.45 | ) | (0.59 | ) | 14.00 | 8.06% | $ | 779,627 | 0.54% | |||||||||||||||
Class VI Shares | ||||||||||||||||||||||||
Period ended December 31, 2004 (f) | (0.15 | ) | (0.32 | ) | 11.52 | 12.58% | $ | 440 | 0.41% | |||||||||||||||
For the year ended December 31, 2005 | (0.23 | ) | (0.47 | ) | 11.96 | 7.95% | $ | 7,303 | 0.51% | |||||||||||||||
For the year ended December 31, 2006 | (0.18 | ) | (0.46 | ) | 13.47 | 16.92% | $ | 11,389 | 0.56% | |||||||||||||||
For the six months ended June 30, 2007 (Unaudited) | (0.45 | ) | (0.60 | ) | 13.95 | 8.08% | $ | 11,879 | 0.57% | |||||||||||||||
[Additional columns below]
[Continued from above table, first column(s) repeated]
Ratios/Supplemental Data | ||||||||||||||||||
Ratio of Net | ||||||||||||||||||
Ratio of | Investment | |||||||||||||||||
Ratio of Net | Expenses | Income | ||||||||||||||||
Investment | (Prior to | (Prior to | ||||||||||||||||
Income | Reimbursements) | Reimbursements) | ||||||||||||||||
to Average | to Average | to Average | Portfolio | |||||||||||||||
Net Assets (b) | Net Assets (b)(c) | Net Assets (b)(c) | Turnover (d) | |||||||||||||||
Class II Shares | ||||||||||||||||||
For the year ended December 31, 2002 | 1.41% | (g) | (g) | 111.74% | ||||||||||||||
For the year ended December 31, 2003 | 1.60% | (g) | (g) | 49.13% | ||||||||||||||
For the year ended December 31, 2004 (e) | 2.13% | (g) | (g) | 18.26% | ||||||||||||||
For the year ended December 31, 2005 | 2.04% | (g) | (g) | 9.12% | ||||||||||||||
For the year ended December 31, 2006 | 1.56% | (g) | (g) | 7.82% | ||||||||||||||
For the six months ended June 30, 2007 (Unaudited) | 1.41% | 0.54% | 1.41% | 70.36% | ||||||||||||||
Class VI Shares | ||||||||||||||||||
Period ended December 31, 2004 (f) | 3.59% | (g) | (g) | 18.26% | ||||||||||||||
For the year ended December 31, 2005 | 3.82% | (g) | (g) | 9.12% | ||||||||||||||
For the year ended December 31, 2006 | 1.72% | (g) | (g) | 7.82% | ||||||||||||||
For the six months ended June 30, 2007 (Unaudited) | 1.39% | 0.57% | 1.39% | 70.36% | ||||||||||||||
(a) | Not annualized for periods less than one year. | |
(b) | Annualized for periods less than one year. | |
(c) | During the period, certain fees were waived and/or reimbursed. If such waivers/reimbursements had not occurred, the ratios would have been as indicated. | |
(d) | Portfolio turnover is calculated on the basis of the Fund as a whole without distinguishing among the classes of shares. | |
(e) | On April 30, 2004, the existing share Class of the Fund was renamed Class II Shares. | |
(f) | For the period from April 30, 2004 (commencement of operations) through December 31, 2004. | |
(g) | There were no fee reductions during the period. |
See accompanying notes to financial statements.
1. | Organization |
Nationwide Variable Insurance Trust (“NVIT” or the “Trust”) is an open-end management investment company, organized under the laws of Delaware by an amended and restated Agreement and Declaration of Trust, dated October 28, 2004, as amended to date. Prior to May 1, 2007, the Trust was named “Gartmore Variable Insurance Trust”. The Trust, originally created under the laws of Massachusetts as a Massachusetts business trust pursuant to a Declaration of Trust dated, as of June 30, 1981, and as subsequently amended, redomesticated as a Delaware Statutory Trust after the close of trading on April 29, 2005, and is registered under the Investment Company Act of 1940, as amended (the “1940 Act”). The redomestication was a change in statutory status and did not affect the operations of the Trust. As of June 30, 2007, the Trust had authorized an unlimited number of shares of beneficial interest, without par value (“shares”). The Trust currently offers shares to life insurance company separate accounts to fund the benefits under variable life insurance or annuity policies. To date, only the separate accounts of Nationwide Life Insurance Company and Nationwide Life and Annuity Insurance Company (collectively, “Nationwide”) have purchased shares of the Nationwide NVIT Investor Destinations Aggressive Fund (the “Fund”) (formerly, “Gartmore GVIT Investor Destinations Aggressive Fund”). The Trust currently operates forty (40) separate series, or mutual funds, each with its own investment objectives and strategies. This report contains the financial statements and financial highlights of the Fund.
The Fund is constructed as a “fund of funds,” which means that the Fund pursues its investment objective by allocating the Fund’s investments primarily among other mutual funds (the “Underlying Funds”). The Underlying Funds typically invest, either directly or indirectly, in stocks, bonds, and other securities.
2. | Summary of Significant Accounting Policies |
The following is a summary of significant accounting policies followed by the Fund in the preparation of its financial statements. The policies are in conformity with accounting principles generally accepted in the United States of America (“GAAP”). The preparation of financial statements requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of income and expenses for the period. Actual results could differ from those estimates.
(a) | Security Valuation |
Shares of the Underlying Funds in which the Fund invests are valued at their respective net asset values as reported by the Underlying Funds. The securities in the Underlying Funds generally are valued as of the close of business of the regular session of trading on the New York Stock Exchange (usually at 4 p.m. Eastern time). The Underlying Funds generally value securities and assets at current market value. | |
The following policies, (b) through (h), represent the accounting policies applicable to the Underlying Funds. |
(b) | Repurchase Agreements |
The Fund may enter into repurchase agreements with an entity which is a member of the Federal Reserve System or which is a “primary dealer” (as designated by the Federal Reserve Bank of New York) in U.S. Government obligations. The repurchase price generally equals the price paid by the Fund plus interest negotiated on the basis of current short-term rates, which may be more or less than the rate on the underlying portfolio securities. The seller under a repurchase agreement is required to maintain the value of the collateral held pursuant to the agreement at a market value equal to or greater than the repurchase price (including accrued interest). Collateral subject to repurchase agreements is held by the Fund’s custodian or another qualified sub-custodian or in the Federal Reserve/ Treasury book-entry system. If the counterparty defaults and the fair value of the collateral declines, realization of the collateral by the Fund may be delayed or limited. The Fund may transfer uninvested cash balances into a pooled cash account. These balances are invested in one or more repurchase agreements, with the counterparty of Nomura Securities, which is fully collateralized by U.S. Government Agency Mortgages. |
(c) | Foreign Currency Transactions |
The accounting records of the Fund are maintained in U.S. dollars. Foreign currency amounts are translated into U.S. dollars at the current rate of exchange to determine the value of investments, assets and liabilities. The Fund may enter into foreign currency contracts in connection with purchases or sales of securities denominated in a foreign currency. Purchases and sales of securities, and income and expenses, are translated at the prevailing rate of exchange on the respective date of these transactions. The Fund does not isolate that portion of the results of operations resulting from changes in foreign exchange rates on investments from fluctuations arising from changes in market prices of securities held. These fluctuations are included with the net realized and unrealized gain or loss from investments and foreign currencies. |
(d) | Forward Foreign Currency Contracts |
The Fund may enter into forward foreign currency contracts in connection with planned purchases or sales of securities or to hedge the U.S. dollar value of portfolio securities denominated in a particular currency. The Fund could be exposed to risks if the counterparties to the contracts are unable to meet the terms of their contracts and from unanticipated movements in the value of a foreign currency relative to the U.S. dollar. Forward foreign currency contracts are valued at the current cost of covering these contracts, as provided by an independent pricing service approved by the Trust’s Board of Trustees (“Board of Trustees”). The forward foreign currency contracts are adjusted by the daily exchange rate of the underlying currency and any gains or losses are recorded for financial statement purposes as unrealized gains or losses until the contract settlement date. |
(e) | Futures Contracts |
The Fund may invest in financial futures contracts (“futures contracts”) for the purpose of hedging its existing portfolio securities or securities that the Fund intends to purchase against fluctuations in value caused by changes in prevailing market interest rates or prices. Futures contracts may also be entered into for non-hedging purposes. | |
Upon entering into a futures contract, the Fund is required to pledge to the broker an amount of cash and/or other assets equal to a certain percentage of the contract amount (initial margin deposit). Subsequent payments, known as “variation margin,” are made each day, depending on the daily fluctuations in the fair value/market value of the underlying assets. A gain or loss equal to the daily variation margin is recognized on a daily basis. Futures contracts are valued daily at their last quoted sale price. | |
A “sale” of a futures contract means the creation of a contractual obligation to deliver the securities or foreign currency called for by the contract at a fixed price at a specified time in the future. A “purchase” of a futures contract means the creation of a contractual obligation to acquire the securities or foreign currency at a fixed price at a specified time in the future. | |
Should market conditions change unexpectedly, the Fund may not achieve the anticipated benefits of the futures contracts and may realize a loss. The use of futures transactions for hedging purposes involves the risk of imperfect correlation in movements in the price of futures contracts, interest rates, and the value of the underlying hedged assets. |
(f) | Written Options Contracts |
The Fund may write options contracts. A written option obligates the Fund to deliver (written call) or to receive (written put) a specified quantity of an underlying asset at the contract amount upon exercise by the holder of the option. When the Fund writes an option, an amount equal to the premium received by the Fund is recorded as a liability and is subsequently adjusted to the current fair value of the option written. Premiums received from writing options that expire unexercised are treated by the Fund on the expiration date as realized gains from investments. The difference between the premium and the amount paid on effecting a closing purchase transaction, as a realized loss. If a call option is exercised, the premium is added to the proceeds from the sale of the underlying security or currency in determining whether the Fund has realized a gain or loss. If a put option is exercised, the premium reduces the |
cost basis of the securities purchased by the Fund. Options traded on an exchange are valued at the last quoted sale price, or in the absence of a sale, the bid price provided by an independent pricing service approved by the Board of Trustees. Non-exchange traded options are valued using dealer supplied quotes. The Fund as a writer of an option bears the market risk of an unfavorable change in the price of the security underlying the written option. |
(g) | Mortgage Dollar Rolls |
The Fund may enter into mortgage “dollar rolls” in which the Fund sells mortgage-backed securities for delivery in the current month and simultaneously contracts to repurchase substantially similar (same type, coupon, and maturity) securities on a specified future date. Mortgage dollar rolls may be implemented in the “to be announced” (“TBA”) market and are referred to as TBAs on the Statement of Investments of the Fund. During the roll period, the Fund foregoes principal and interest paid on the mortgage-backed securities. Each mortgage dollar roll is treated as a financing transaction; therefore, any gain or loss is considered unrealized until the roll reaches completion. Risks may arise due to the delayed payment date and the potential inability of counterparties to complete the transaction. Income is generated as consideration for entering into these transactions and is included in interest income on the Statement of Operations. |
(h) | Short Sales |
The Fund is authorized to engage in short-selling of portfolio securities which obligates the Fund to replace any security that the Fund has borrowed by purchasing the security at current market value sometime in the future. The Fund will incur a loss if the price of the security increases between the date of the short sale and the date on which the Fund replaces the borrowed security. The Fund generally will realize a gain if the price of the security declines between these dates. Until the Fund replaces the borrowed security, the Fund will maintain a segregated account with cash, U.S. Government securities and/or securities held long to sufficiently cover the Fund’s short position on a daily basis. Dividends declared on securities sold short are recorded as an expense on the ex-dividend date and paid to the counterparty on the dividend pay date. |
(i) | Security Transactions and Investment Income |
Security transactions are accounted for on the date the security is purchased or sold (“trade date”). Securities gains and losses are calculated on the identified cost basis. Interest income is recognized on the accrual basis and includes, where applicable, the amortization or accretion of premium or discount. |
(j) | Distributions to Shareholders |
The Fund’s dividends from net investment income, if any, are declared and paid quarterly. The Fund’s distributions from net realized capital gains, if any, are declared and distributed at least annually. | |
Dividends and distributions to shareholders are determined in accordance with federal income tax regulations, which may differ from GAAP. These “book/ tax” differences are considered either permanent or temporary in nature. In accordance with the American Institute of Certified Public Accountants Statement of Position 93-2, permanent differences (i.e., reclassification of market discounts, foreign exchange gain/loss, paydowns, and distributions from real estate investment trusts) are reclassified within the capital accounts based on their nature for federal income tax purposes; temporary differences do not require reclassification. These reclassifications have no effect upon the net asset value of the Fund. To the extent distributions exceed current and accumulated earnings and profits for federal income tax purposes, these distributions are reported as distributions of paid-in-capital. |
(k) | Federal Income Taxes |
It is the policy of the Fund to qualify or to continue to qualify as a “regulated investment company” by complying with the provisions available to certain investment companies, as defined in Subchapter M of the U.S. Internal |
Revenue Code, and to make distributions of net investment income and net realized capital gains sufficient to relieve the Fund from all, or substantially all, federal income taxes. | |
As of June 30, 2007, the tax cost of securities and the breakdown of unrealized appreciation (depreciation) for the Fund was as follows: |
Net | ||||||||||||||||
Unrealized | ||||||||||||||||
Tax Cost of | Unrealized | Unrealized | Appreciation | |||||||||||||
Securities | Appreciation | Depreciation | (Depreciation) | |||||||||||||
$ | 714,395,529 | $ | 77,734,544 | $ | (664,571 | ) | $ | 77,069,973 | ||||||||
(l) | Allocation of Expenses, Income, and Gains and Losses |
Expenses directly attributable to the Fund are charged to the Fund. Expenses not directly attributable to the Fund are allocated proportionately among various or all funds within the Trust. The method used by the Fund for allocating income, fund level expenses, and realized and unrealized gains or losses is based on the fair value of shares outstanding relative to net assets. Under this method, each class of shares participates based on the total net asset value of that class’s shares in proportion to the total net assets of the Fund. Expenses specific to a class (such as Rule 12b-1 and administrative services fees) are charged to that class. |
3. | Transactions with Affiliates |
Under the terms of the Trust’s Investment Advisory Agreement, Nationwide Fund Advisors (formerly, Gartmore Mutual Fund Capital Trust (“GMF”)) (“NFA” or the “Advisor”) manages the investment of the assets and supervises the daily business affairs of the Fund. NFA is a wholly-owned subsidiary of Nationwide Financial Services (“NFS”).
Under the terms of the Investment Advisory Agreement, the Fund pays NFA an investment advisory fee of 0.13% based on the Fund’s average daily net assets.
Under the terms of a Fund Administration and Transfer Agency Agreement, Nationwide Fund Management, LLC (formerly, Gartmore Investor Services, Inc. (“GISI”)) (“NFM”), a wholly-owned subsidiary of NFS Distributors, Inc. (“NFSDI”), provides various administrative and accounting services for the Funds (prior to May 1, 2007, this service was provided by Gartmore SA Capital Trust (“GSA”)), and, serves as Transfer Agent and Dividend Disbursing Agent for each of the Funds (prior to May 1, 2007, this service was provided by GISI, an indirect subsidiary of GSA). The Funds do not pay a fee for these.
NFA and NFM have entered into agreements with Citi Fund Services Ohio, Inc. (“Citi”), pursuant to which Citi provides sub-administration and sub-transfer agency services, respectively, to the Fund. Effective August 1, 2007, The BISYS Group Inc. was acquired by and became a wholly owned subsidiary of Citi.
Under the terms of a Distribution Plan under Rule 12b-1 of the 1940 Act, Nationwide Fund Distributors, LLC. (formerly, “Gartmore Distribution Services, Inc. (“GDSI”)) (“NFD” or “Distributor”), the Fund’s principal underwriter, is compensated by the Fund for expenses associated with the distribution of the Class II and Class VI shares of the Fund. NFD is a wholly-owned subsidiary of NFS Distributors, Inc. (“NFSDI”). These fees are based on average daily net assets of each class of shares of the Fund at an annual rate not to exceed 0.25%.
Under the terms of an Administrative Services Plan, the Fund may pay fees to servicing organizations, such as broker-dealers, including NFS, and financial institutions, which agree to provide administrative support services to the shareholders of certain classes. These services include, but are not limited, to the following: establishing and maintaining shareholder accounts; processing purchase and redemption transactions; arranging bank wires; performing shareholder sub-accounting; answering inquires regarding the Fund; and other such services. These fees are based on an annual rate of up to 0.25% of the average daily net assets of each class of shares of the Fund.
For the six months ended June 30, 2007, NFS received $572,602 in Administrative Services Fees from the Fund.
Under the terms of a letter agreement dated September 12, 2006, by and among NFA, the Audit Committee of the Trust and the Trust, the Trust has agreed to reimburse NFA certain costs related to the Fund’s portion of ongoing administration, monitoring and annual (audit) testing of the Trust’s Rule 38a-1 Compliance Program subject to the pre-approval of the Trust’s Audit Committee. For the six months ended June 30, 2007, the Fund’s portion of such costs amounted to $5,195.
Because the Fund invests primarily in other affiliated funds, the Fund is a shareholder of those Underlying Funds. The Underlying Funds do not charge the Fund any sales charge for buying or selling shares. However, the Fund indirectly pays a portion of the operating expenses, including management fees of the Underlying Funds and short-term investments the Fund holds. These expenses are deducted from the Underlying Funds before their share prices are calculated and are in addition to the fees and expenses of the Fund. Actual indirect expenses vary depending on how the Fund’s assets are spread among the underlying investments.
4. | Short-Term Trading Fees |
The Fund reserves the right to assess a short-term trading fee on certain transactions out of Class VI shares that a separate account makes on behalf of a variable insurance contract owner (the “contract owner”). A separate account that redeems Class VI shares on behalf of a contract owner may be subject to a 1.00% short-term trading fee if the separate account held the Class VI shares on behalf of the contract owner for 60 days or less, unless an exception applies as disclosed in the Fund’s prospectus. The short-term trading fee is paid directly to the Fund and is intended to offset the cost to the Fund of excess brokerage commissions and other costs associated with fluctuations in Fund asset levels and cash flow caused by short-term trading. For purposes of determining whether the short-term trading fee applies, the Class VI shares that were held on behalf of the contract owner the longest will be treated as being redeemed first.
For the six months ended June 30, 2007, the Fund had contributions to capital due to collection of redemption fees in the amount of $1,019.
5. | Investment Transactions |
For the six months ended June 30, 2007, (excluding short-term securities) the Fund had purchases of $547,663,125 and sales of $540,759,911.
6. | Bank Loans and Earnings Credit |
The Trust has a credit agreement with JPMorgan Chase & Co., the Fund’s custodian bank, permitting the Trust to borrow up to $100,000,000. Borrowings under this arrangement bear interest at the Federal Funds rate plus 0.50%. The interest costs, if any, would be included in other fees in the Statement of Operations. No compensating balances were required under the terms of the line of credit. The line of credit is renewed annually, expiring on June 25, 2008, with a commitment fee of 0.07% per year on $100,000,000. There were no borrowings outstanding under this line of credit for the six months ended June 30, 2007.
The Trust’s custodian bank has agreed to reduce the bank’s fees (earnings credit) when the funds of the Trust maintain cash on deposit in non-interest-bearing custody and Demand Deposit Accounts. Earnings credits, if any, are shown as a reduction of total expenses on the Statement of Operations.
7. | Portfolio Investment Risks |
Risks Associated with Foreign Securities and Currencies. Investments in securities of foreign issuers carry certain risks not ordinarily associated with investments in securities of U.S. issuers. These risks include future political and economic developments, and the possible imposition of exchange controls or other foreign governmental laws and restrictions. In addition, with respect to certain countries, there is the possibility of expropriation of assets, confiscatory taxation, political or social instability, or diplomatic developments, which could adversely affect investments in those countries.
Certain countries also may impose substantial restrictions on investments in their capital markets by foreign entities, including restrictions on investments in issuers of industries deemed sensitive to relevant national interests. These factors may limit the investment opportunities available and result in a lack of liquidity and high price volatility with respect to securities of issuers from developing countries.
8. Indemnifications
Under the Trust’s organizational documents, certain of the Trust’s Officers and Trustees are indemnified against certain liabilities arising out of the performance of their duties to the Trust. In addition, the Trust has entered into Indemnification Agreements with the Trust’s trustees and certain officers covering similar liabilities. Trust Officers receive no compensation from the Trust for serving as the Trust’s Officers. In addition, in the normal course of business, the Trust enters into contracts with its vendors and others that provide for general indemnifications. The Trust’s maximum exposure under these arrangements is unknown, as this would involve future claims that may be made against the Trust. Based on experience, however, the Trust expects that risk of loss to be remote.
9. | Recently Issued Accounting Pronouncements |
On July 13, 2006, the Financial Accounting Standards Board (“FASB”) released FASB Interpretation No. 48, Accounting for Uncertainty in Income Taxes (“FIN 48”). FIN 48 provides guidance for how uncertain tax positions should be recognized, measured, presented and disclosed in the financial statements. FIN 48 requires the affirmative evaluation of tax positions taken or expected to be taken in the course of preparing the Fund’s tax returns to determine whether it is more-likely-than-not (i.e., greater than 50 percent) that each tax position will be sustained upon examination by a taxing authority based on the technical merits of the position. A tax position that meets the more-likely-than-not recognition threshold is measured to determine the amount of benefit to recognize in the financial statements. Differences between tax positions taken in a tax return and amounts recognized in the financial statements will generally result in an increase in a liability for taxes payable (or a reduction of a tax refund receivable) and an increase in a deferred tax liability (or a reduction in a deferred tax asset). Adoption of FIN 48 was required no later than the last business day of the first financial statement reporting period for fiscal years beginning after December 15, 2006 and is to be applied to all open tax years as of the effective date. Accordingly, the Fund was required to implement FIN 48 in its net asset value per share (NAV) calculation on June 29, 2007. Management has evaluated the implications of FIN 48 and has concluded that there was no impact to the Fund’s financial statements as of June 29, 2007. The adoption of FIN 48 requires ongoing monitoring and analysis, future conclusions reached by management may be different and result in adjustments to the Fund’s NAV and financial statements.
In September 2006, the FASB issued Statement on Financial Accounting Standards (“SFAS”) No. 157, “Fair Value Measurements.” This standard establishes a single authoritative definition of fair value, sets out a framework for measuring fair value and requires additional disclosures about fair value measurements. SFAS No. 157 applies to fair value measurements already required or permitted by existing standards. SFAS No. 157 is effective for financial statements issued for fiscal years beginning after November 15, 2007 and interim periods within those fiscal years. The changes to current accounting principles generally accepted in the United States of America from the application of this Statement relate to the definition of fair value, the methods used to measure fair value, and the expanded disclosures about fair value measurements. As of June 30, 2007, the Fund does not believe the adoption of SFAS No. 157 will impact the financial statement amounts; however, additional disclosures may be required about the inputs used to develop the measurements and the effect of certain of the measurements on changes in net assets for the period.
Trustees who are not Interested Persons (as defined in the 1940 Act) and Officers of the Trust as of
Number of Portfolios | ||||||||||
Position(s) Held | in the | |||||||||
with the Trust | Principal Occupation(s) | Nationwide Fund | Other | |||||||
Name, Address | and Length of | During Past | Complex Overseen | Directorships | ||||||
and Year of Birth | Time Served1 | Five Years | by Trustee | Held by Trustee2 | ||||||
Charles E. Allen c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1948 | Trustee since July 2000 | Mr. Allen is Chairman, Chief Executive Officer and President of Graimark Realty Advisors, Inc. (real estate development, investment and asset management). | 89 | None | ||||||
Paula H.J. Cholmondeley c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1947 | Trustee since July 2000 | Ms. Cholmondeley was Vice President and General Manager of Sappi Fine Paper North America from April 2000 through December 2003. | 89 | Director of Dentsply International, Inc. (dental products), Ultralife Batteries, Inc., Terex Corporation (construction equipment), Minerals Technology, Inc. (specialty chemicals) and Albany International Corp. (paper industry) | ||||||
C. Brent DeVore3 c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1940 | Trustee since 1990 | Dr. DeVore is President of Otterbein College. | 89 | None | ||||||
Phyllis Kay Dryden c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1947 | Trustee since December 2004 | Ms. Dryden was a partner of Mitchell Madison, a management consulting company from January 2006 until December 2006; she is currently a consultant with the company. Ms. Dryden was formerly Managing Partner of march FIRST, a global management consulting firm. | 89 | None | ||||||
Barbara L. Hennigar c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1935 | Trustee since July 2000 | Retired. | 89 | None | ||||||
Number of Portfolios | ||||||||||
Position(s) Held | in the | |||||||||
with the Trust | Principal Occupation(s) | Nationwide Fund | Other | |||||||
Name, Address | and Length of | During Past | Complex Overseen | Directorships | ||||||
and Year of Birth | Time Served1 | Five Years | by Trustee | Held by Trustee2 | ||||||
Barbara I. Jacobs c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1950 | Trustee since December 2004 | Ms. Jacobs served as Chairman of the Board of Directors of KICAP Network Fund, a European (United Kingdom) hedge fund, from January 2001 through January 2006. From 1998-2003, Ms. Jacobs was also a Managing Director and European Portfolio Manager of CREF Investments (Teachers Insurance and Annuity Association-College Retirement Equities Fund). | 89 | None | ||||||
Douglas F. Kridler c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1955 | Trustee since September 1997 | Mr. Kridler has served as the President and Chief Executive Officer of the Columbus Foundation (a Columbus, OH-based foundation which manages over 1,300 individual endowment funds) since February 2002. Prior to January 31, 2002, Mr. Kridler was the President of the Columbus Association for the Performing Arts and Chairman of the Greater Columbus Convention and Visitors Bureau. | 89 | None | ||||||
Michael D. McCarthy c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1947 | Trustee since December 2004 | Retired. Mr. McCarthy was Chairman of VMAC (commodity swaps) from October 2002 until January 2007; and a partner of Pineville Properties LLC (a commercial real estate development firm) from September 2000 until January 2007. | 89 | None | ||||||
David C. Wetmore c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1948 | Trustee since 1995 and Chairman since February 2005 | Retired. | 89 | None | ||||||
1 | Length of time served includes time served with the Trust’s predecessors. | |
2 | Directorships held in (1) any other investment companies registered under the 1940 Act, (2) any company with a class of securities registered pursuant to Section 12 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or (3) any company subject to the requirements of Section 15(d) of the Exchange Act. | |
3 | Mr. DeVore has served as President of Otterbein College since 1984. Mark Thresher, President and Chief Operating Officer of Nationwide Financial Services, Inc. (“NFS”) has served as a member of the Board of Trustees of Otterbein College since 2000, currently serves as one of 30 of its trustees, and is currently one of two Vice Chairmen of the Board. Each of Nationwide Fund Advisors (“NFA”), the Funds’ investment adviser, and Nationwide Fund Distributors LLC (“NFD”), principal underwriter to the Trust, is a wholly-owned subsidiary of NFS. | |
Additional information regarding the Trustees and Officers may be found in the Trust’s Statement of Additional Information, which is available without charge upon request, by calling 800-848-0920. |
Trustees who are Interested Persons (as defined in the 1940 Act) and/or Officers of the Trust as of
Number of Portfolios | ||||||||||
Position(s) Held | in the | |||||||||
with the Trust | Principal Occupation(s) | Nationwide Fund | Other | |||||||
Name, Address | and Length of | During Past | Complex Overseen | Directorships | ||||||
and Year of Birth | Time Served1 | 5 Years | by Trustee | Held by Trustee 2 | ||||||
Arden L. Shisler c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1941 | Trustee since February 2000 | Retired. Mr. Shisler is the former President and Chief Executive Officer of KeB Transport, Inc., a trucking firm (2000 through 2002). He served as a consultant to KeB from January 2003 through December 2004. Since 1992, Mr. Shisler has also been Chairman of the Board for Nationwide Mutual Insurance Company.3 | 89 | Director of Nationwide Financial Services, Inc., Chairman of Nationwide Mutual Insurance Company3 | ||||||
John H. Grady Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1961 | President & Chief Executive Officer since December 2006 | Mr. Grady is President, and Chief Executive Officer of Nationwide Funds Group which includes Nationwide Fund Advisors,3 Nationwide Fund Management LLC,3 Nationwide Fund Distributors LLC 3 and NWD Investments,2 the asset management operations of Nationwide Mutual Insurance Company, which includes Morley Capital Management, Inc.,2 Nationwide Separate Accounts LLC,2 NorthPointe Capital LLC,2 and Nationwide SA Capital Trust2. From March 2004 until March 2006, Mr. Grady was Chief Executive Officer of Constellation Investment Management Co., L.P. (registered investment adviser), and President and Chief Executive Officer of Constellation Funds Group (registered investment companies). He also was President of Constellation Investment Distribution Co., Inc. (registered broker-dealer) from March 2004 until June 2006. From February 2001 until February 2004, Mr. Grady was Chief Operating and Chief Legal Officer; Managing Director, Mutual Funds Group, Turner Investment Partners, Inc. (registered investment adviser); Executive Vice President of Turner Funds and Turner Institutional Portfolios (registered investment companies); and President, Turner Investment Distributors, Inc. (registered broker-dealer). | N/A | None | ||||||
Gerald J. Holland Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1951 | Treasurer since March 2001 | Mr. Holland is Senior Vice President—Operations for Nationwide Funds Group3. | N/A | N/A | ||||||
Number of Portfolios | ||||||||||
Position(s) Held | in the | |||||||||
with the Trust | Principal Occupation(s) | Nationwide Fund | Other | |||||||
Name, Address | and Length of | During Past | Complex Overseen | Directorships | ||||||
and Year of Birth | Time Served1 | 5 Years | by Trustee | Held by Trustee 2 | ||||||
Michael A. Krulikowski Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1959 | Chief Compliance Officer from June 2004 to August 20074 | Mr. Krulikowski is Vice President and Chief Compliance Officer of Nationwide Funds Group3, Morley Capital Management, Inc.3, Nationwide SA Capital Trust (since 1999)3, and Nationwide Separate Accounts LLC (since August 2005).3 Since June 2004, Mr. Krulikowski has also served as Chief Compliance Officer of the Trust. From November 1999 through May 2007, he served as Vice President and Chief Compliance Officer of NorthPointe Capital LLC. 3 | N/A | N/A | ||||||
Eric E. Miller Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1953 | Secretary since December 2002 | Mr. Miller is Senior Vice President, General Counsel, and Assistant Secretary for Nationwide Funds Group3 and NWD Investments.2 From August 2000 to August 2002, Mr. Miller was a Partner with Stradley Ronon Stevens & Young, LLP. | N/A | N/A | ||||||
1 | Length of time served includes time served with the Trust’s predecessors. | |
2 | Directorships held in (1) any other investment companies registered under the 1940 Act, (2) any company with a class of securities registered pursuant to Section 12 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or (3) any company subject to the requirements of Section 15(d) of the Exchange Act. | |
3 | This position is held with an affiliated person or principal underwriter of the Trust. | |
4 | Effective August 3, 2007, the Board of Trustees approved Carol Baldwin Moody as Chief Compliance Officer of the Trust. Since November 2005, Ms. Moody has been Senior Vice President, Chief Compliance Officer of Nationwide Financial Services, Nationwide Life Insurance Company, Nationwide Life and Annuity Insurance Company, and Nationwide Investment Advisors, LLC. From February 2004-November 2005, she was Chief Compliance Officer of TIAA-CREF and from April 2000-February 2004, she was Managing Director and General Counsel, TCW/ Latin America Partners, LLC and Baeza & Co., LLC. | |
Federal law requires the Trust, each of its investment advisers and sub-advisers to adopt procedures for voting proxies (“Proxy Voting Guidelines”) and to provide a summary of those Proxy Voting Guidelines used to vote the securities held by the Funds. The Funds’ proxy voting policies and procedures are available without charge (i) upon request, by calling 800-848-0920, (ii) on the Funds’ website at www.nationwidefunds.com, or (iii) on the Securities and Exchange Commission’s website at www.sec.gov. |
A. Renewal of Investment Advisory Agreement
(i) | General Information Regarding the Board’s Review of Investment Advisory Agreements |
The Trust’s investment advisory agreements (each an “Advisory Agreement”) with its investment adviser and, as applicable, sub-advisers (together, the “Adviser”) must be approved for an initial term no greater than two years, and renewed at least annually thereafter, (i) by the vote of the Trustees or by a vote of the shareholders of each series or fund of the Trust (individually a “Fund”), and (ii) by the vote of a majority of the Trustees who are not parties to the Advisory Agreement or “interested persons” of any party thereto (the “Independent Trustees”) cast in person at a meeting called for the purpose of voting on such approval.
The Board meets quarterly and takes into account throughout the year matters bearing on each Fund’s Advisory Agreement. The Board and its standing committees consider at each meeting factors that are relevant to the annual renewal of an Advisory Agreement, including the services and support provided to a Fund and its shareholders.
On December 6, 2006, the Independent Trustees first met in person with their independent legal counsel (“Independent Legal Counsel”) to consider information provided by the Adviser and others to assist the Trustees in considering whether to renew each Fund’s Advisory Agreement for a one year term beginning May 1, 2007. Immediately following such meeting of the Independent Trustees, all Trustees met in person with the Adviser, Trust counsel, Independent Legal Counsel and others to consider such matters, and give preliminary consideration to information bearing on continuation of each Advisory Agreement. The primary purpose of the December 6 and 7, 2006 meeting was to ensure that the Trustees had ample opportunity to consider matters they deemed relevant in considering the continuation of an Advisory Agreement, and to request any additional information they considered reasonably necessary to their deliberations.
In preparation for the December 6 and 7, 2006 meeting the Trustees were provided, at the request of the Trustees, with a wide range of information to assist in their deliberations, including (i) reports from Lipper Inc. describing a Fund’s (a) performance rankings (where “first quintile” denotes the best performance) (over multiple years ended September 30, 2006) compared with performance groups and performance universes created by Lipper (and in some cases, customized peer groups created by the Adviser) of similar or peer group funds, and (b) expense rankings (where “first quintile” denotes the lowest fees and expenses) comparing the Fund’s contractual advisory fee and total expenses with expense groups and expense universes created by Lipper of similar or peer group funds, (ii) information from the Adviser describing the Fund’s performance (over multiple years ended September 30, 2006) compared with its benchmark and Lipper categories, (iii) for Funds under “close review,” copies of letters from the Adviser to the portfolio manager of each such Fund, together with the portfolio manager’s written response describing the reasons for the Fund’s underperformance (iv) information from the Adviser describing performance for the months of October and November, 2006, and annual performance for the year ended November 30, 2006, (v) reports from the Adviser describing the Adviser’s profitability in providing services under an Advisory Agreement, together with an explanation of Adviser’s methodology in calculating its profitability, (vi) information from the Adviser describing any fees paid to the Adviser for managing similar, non-affiliated institutional accounts, including the range of fee levels for such accounts, and (vii) information from the Adviser describing ancillary benefits, in addition to fees for serving as investment adviser, derived by the Adviser as a result of being investment adviser for a Fund, including, where applicable, information on soft-dollar benefits and fees inuring to the Adviser’s affiliates for serving as the Trust’s administrator, fund accountant and transfer agent.
At the December 6 and 7, 2006 meeting, the Trustees reviewed, considered and discussed, among themselves and with the Adviser, Trust counsel and Independent Legal Counsel, among other things, the information described above, and: (i) the nature, extent and quality of services provided by the Adviser under each Advisory Agreement, (ii) the investment performance of each Fund and the Adviser, (iii) the costs of the services provided by the Adviser under the Advisory Agreement and the profits realized by the Adviser thereunder, (iv) the extent to which economies of scale may be present and, if so, whether they are being shared with a Fund’s shareholders, (v) comparisons of the Adviser’s fees under the Advisory Agreement with investment advisory fees paid by peer group funds to their investment advisers and paid by non-affiliated institutional clients to the Adviser for managing similar accounts, and (vi) any ancillary benefits inuring to the Adviser and its affiliates as a result of being investment adviser for the Trust. The Trustees also considered, where
As part of the December 6 and 7, 2006 Board meeting, the Independent Trustees developed a list of follow-up matters and questions and asked that Adviser respond to such matters and questions at the contract approval meeting of the Board of Trustees to be held on January 11, 2007.
At the January 11, 2007 meeting of the Board of Trustees of the Trust, the Board received and considered information provided by the Adviser in follow-up from the December 6 and 7, 2006 Board meeting and, after consulting among themselves, and with the Adviser, Trust counsel and Independent Legal Counsel, concluded unanimously to renew the Advisory Agreement for the reasons set forth in the following section. In determining whether to renew the Advisory Agreement for the Fund, the Board ultimately reached a determination, with the assistance of Trust counsel and Independent Legal Counsel, that the renewal of the Advisory Agreement and the compensation to be received by the Adviser under the Advisory Agreement is consistent with the Board’s fiduciary duty under applicable law.
(ii) Board Conclusions Regarding the Fund’s Advisory Agreement
The Board considered that the Fund had outperformed its secondary benchmark (which is a more appropriate indicator of performance than the Fund’s primary benchmark) for the one- and three-year periods. The Board also considered that the performance of the Fund’s Class II shares had ranked in the fourth quintile of the Fund’s Lipper-constructed Performance Group over the one-, three- and four-year periods, and in the fifth quintile over the two-year period. The Board also considered that the Fund’s portfolio manager had changed during 2006 and considered the services provided by the adviser to the Fund that are in addition to the advisory services that are provided to the underlying funds. Based on its review, and giving particular weight to the nature and quality of the resources dedicated by the adviser to maintain relative performance, the Board concluded that the nature, extent, and quality of the services provided to the Fund will benefit the Fund’s shareholders.
The Board also considered that the Fund’s contractual advisory fee and breakpoints placed the Fund in the fifth quintile of its Lipper-constructed Expense Group and the Fund’s total expenses placed the Fund in the first quintile. The Board also considered that the Fund’s contractual advisory fee compared with its peer group was relatively high, but within the range of fees charged by the peer group, total expenses were relatively low, and the advisory fee should be consistent among all of the Investor Destination Funds offered by the Trust. The Board concluded that the Fund’s management fee and total expenses were fair and reasonable in light of the services that the Fund receives and the other factors considered.
The Board considered that the Fund’s adviser reported a pre-tax profit margin for investment management services during each of the twelve month-periods ended September 30, 2005 and 2006. The Board considered the costs of the services provided by and the profits realized by the adviser in connection with the operation of the Fund and determined that the amount of profit is a fair entrepreneurial profit for the management of the Fund.
Based upon its evaluation of all of the conclusions noted above, and after considering all material factors with respect to the Fund, the Board ultimately concluded that the advisory fee structure is fair and reasonable, and that the Advisory Agreement (and, if applicable, Sub-Advisory Agreement) with respect to the Fund, should be renewed.
B. Approval of New Advisory Agreement
At its January 11, 2007 meeting, the Board also unanimously approved a new investment advisory agreement (the “New Agreement”) for the Fund with Nationwide Fund Advisors, (“NFA”) the then-current adviser to each of the series of the Trust to become effective upon the closing of the acquisition of NFA by Nationwide Financial Services, Inc. (“NFS”) from Nationwide Corporation (“NWC”) which closed on April 30, 2007 (the “Transaction”). In approving the New Agreement, the Board considered NFA’s capacity to continue to provide the services needed to operate a sophisticated investment management business and to support the management of each of the series. The Board also took into account
C. Submission of Matters to a Vote of Security Holders:
On April 25, 2007, a Special Meeting of Shareholders was held* (the “April 25 Meeting”) at which shareholders of the Funds** set forth below were asked:
Proposal 1:
To approve a new investment advisory agreement, on behalf of their Fund, between Nationwide Fund Advisors (formerly “Gartmore Mutual Fund Capital Trust”) (the “Adviser”) and Nationwide Variable Insurance Trust (formerly “Gartmore Variable Insurance Trust”) (the “Trust”).
Number of Shares | ||||
Fund | Cast/Not Cast | Percentages | ||
Federated NVIT High Income Bond Fund (Formerly Federated GVIT High Income Bond Fund) | FOR 30,051,703.188 shares AGAINST 618,245.021 shares ABSTAIN 1,813,550.431 shares TOTAL 32,483,498.640 shares | 92.514% 1.903% 5.583% | ||
NVIT International Index Fund (Formerly GVIT International Index Fund) | FOR 4,322,203.982 shares AGAINST 2,758.318 shares ABSTAIN 135,636.840 shares TOTAL 4,460,599.140 shares | 96.897% 0.062% 3.041% | ||
NVIT International Value Fund (Formerly GVIT International Value Fund) | FOR 20,032,843.199 shares AGAINST 333,588.902 shares ABSTAIN 1,093,293.879 shares TOTAL 21,459,725.980 shares | 93.351% 1.554% 5.095% | ||
NVIT Mid Cap Index Fund (Formerly GVIT Mid Cap Index Fund) | FOR 35,380,179.120 shares AGAINST 631,117.844 shares ABSTAIN 1,565,714.306 shares TOTAL 37,577,011.270 shares | 94.154% 1.679% 4.167% | ||
Number of Shares | ||||
Fund | Cast/Not Cast | Percentages | ||
NVIT S&P 500 Index Fund (Formerly GVIT S&P 500 Index Fund) | FOR 56,119,814.230 shares AGAINST 666,195.542 shares ABSTAIN 1,944,898.888 shares TOTAL 58,730,908.660 shares | 95.554% 1.134% 3.312% | ||
Nationwide Multi-Manager NVIT Small Cap Growth Fund (Formerly GVIT Small Cap Growth Fund) | FOR 7,632,918.513 shares AGAINST 149,458.111 shares ABSTAIN 451,583.036 shares TOTAL 8,233,959.660 shares | 92.700% 1.816% 5.484% | ||
Nationwide Multi-Manager NVIT Small Cap Value Fund (Formerly GVIT Small Cap Value Fund) | FOR 48,649,396.525 shares AGAINST 979,183.753 shares ABSTAIN 2,786,133.102 shares TOTAL 52,414,713.380 shares | 92.816% 1.868% 5.316% | ||
Nationwide Multi-Manager NVIT Small Company Fund (Formerly GVIT Small Company Fund) | FOR 29,903,181.700 shares AGAINST 838,774.923 shares ABSTAIN 2,006,741.307 shares TOTAL 32,748,697.930 shares | 91.311% 2.561% 6.128% | ||
Gartmore NVIT Developing Markets Fund (Formerly Gartmore GVIT Developing Markets Fund) | FOR 21,0177,889.443 shares AGAINST 424,272.958 shares ABSTAIN 1,543,850.729 shares TOTAL 23,046,013.130 shares | 91.460% 1.841% 6.699% | ||
Gartmore NVIT Emerging Markets Fund (Formerly Gartmore GVIT Emerging Markets Fund) | FOR 17,050,534.593 shares AGAINST 526,574.722 shares ABSTAIN 881,608.905 shares TOTAL 18,458,718.220 shares | 92.371% 2.853% 4.776% | ||
Nationwide NVIT Global Financial Services Fund (Formerly Gartmore GVIT Global Financial Services Fund) | FOR 1,554,847.333 shares AGAINST 19,539.033 shares ABSTAIN 52,206.494 shares TOTAL 1,626,592.860 shares | 95.589% 1.201% 3.210% | ||
Nationwide NVIT Global Health Sciences Fund (Formerly Gartmore GVIT Global Health Sciences Fund) | FOR 4,722,963.678 shares AGAINST 157,979.030 shares ABSTAIN 207,642.222 shares TOTAL 5,088,584.930 shares | 92.815% 3.104% 4.081% | ||
Nationwide NVIT Global Technology and Communications Fund (Formerly Gartmore GVIT Global Technology and Communications Fund) | FOR 8,585,472.039 shares AGAINST 102,267.977 shares ABSTAIN 489,577.634 shares TOTAL 9,177,317.650 shares | 93.551% 1.114% 5.335% | ||
Gartmore NVIT Global Utilities Fund (Formerly Gartmore GVIT Global Utilities Fund) | FOR 4,123,270.549 shares AGAINST 122,001.533 shares ABSTAIN 240,276.088 shares TOTAL 4,485,548.170 shares | 91.923% 2.720% 5.357% |
Number of Shares | ||||
Fund | Cast/Not Cast | Percentages | ||
Nationwide NVIT Government Bond Fund (Formerly Gartmore GVIT Government Bond Fund) | FOR 88,471,567.462 shares AGAINST 1,825,645.181 shares ABSTAIN 5,841,990.727 shares TOTAL 96,139,203.370 shares | 92.024% 1.899% 6.077% | ||
Nationwide NVIT Growth Fund (Formerly Gartmore GVIT Growth Fund) | FOR 14,931,435.904 shares AGAINST 409,826.402 shares ABSTAIN 1,259,945.064 shares TOTAL 16,601,207.370 shares | 89.942% 2.469% 7.589% | ||
Gartmore NVIT International Growth Fund (Formerly Gartmore GVIT International Growth Fund) | FOR 6,251,419.070 shares AGAINST 139,618.548 shares ABSTAIN 290,025.592 shares TOTAL 6,681,063.210 shares | 93.569% 2.090% 4.341% | ||
Nationwide NVIT Investor Destinations Aggressive Fund (Formerly Gartmore GVIT Investor Destinations Aggressive Fund) | FOR 49,489,224.549 shares AGAINST 1,385,396.474 shares ABSTAIN 3,696,272.337 shares TOTAL 54,570,893.360 shares | 90.688% 2.539% 6.773% | ||
Nationwide NVIT Investor Destinations Conservative Fund (Formerly Gartmore GVIT Investor Destinations Conservative Fund) | FOR 23,091,965.887 shares AGAINST 314,935,884 shares ABSTAIN 2,292,355.179 shares TOTAL 25,699,256.950 shares | 89.855% 1.225% 8.920% | ||
Nationwide NVIT Investor Destinations Moderate Fund (Formerly Gartmore GVIT Investor Destinations Moderate Fund) | FOR 188,902,093.059 shares AGAINST 3,018,924.590 shares ABSTAIN 16,359,690.401 shares TOTAL 208,280,708.050 shares | 90.696% 1.449% 7.855% | ||
Nationwide NVIT Investor Destinations Moderately Aggressive Fund (Formerly Gartmore GVIT Investor Destinations Moderately Aggressive Fund) | FOR 134,792,622.920 shares AGAINST 3,489,207.264 shares ABSTAIN 9,304,197.656 shares TOTAL 147,586,027.840 shares | 91.332% 2.364% 6.304% | ||
Nationwide NVIT Investor Destinations Moderately Conservative Fund (Formerly Gartmore GVIT Investor Destinations Moderately Conservative Fund) | FOR 49,627,123.216 shares AGAINST 856,088.634 shares ABSTAIN 3,507,215.650 shares TOTAL 53,990,427.500 shares | 91.918% 1.586% 6.496% | ||
Nationwide NVIT Mid Cap Growth Fund (Formerly Gartmore GVIT Mid Cap Growth Fund) | FOR 10,879,584.971 shares AGAINST 352,594.958 shares ABSTAIN 717,792.971 shares TOTAL 11,949,972.900 shares | 91.043% 2.950% 6.007% |
Number of Shares | ||||
Fund | Cast/Not Cast | Percentages | ||
Nationwide NVIT Money Market Fund II (Formerly Gartmore GVIT Money Market Fund II) | FOR 221,774,863.241 shares AGAINST 12,322,482.494 shares ABSTAIN 16,471,740.875 shares TOTAL 250,569,086.610 shares | 88.508% 4.918% 6.574% | ||
Nationwide NVIT Money Market Fund (Formerly Gartmore GVIT Money Market Fund) | FOR 1,578,331,008.328 shares AGAINST 32,372,133.671 shares ABSTAIN 112,652,123.301 shares TOTAL 1,723,355,265.300 shares | 91.585% 1.878% 6.537% | ||
NVIT Nationwide Fund (Formerly Gartmore GVIT Nationwide Fund) | FOR 125,423,274.735 shares AGAINST 2,767,979.467 shares ABSTAIN 8,762,255.828 shares TOTAL 136,953,510.030 shares | 91.581% 2.021% 6.398% | ||
NVIT Nationwide Leaders Fund (Formerly Gartmore GVIT Nationwide Leaders Fund) | FOR 2,298,504.956 shares AGAINST 29,630.469 shares ABSTAIN 71,637.755 shares TOTAL 2,399,773.180 shares | 95.780% 1.235% 2.985% | ||
Nationwide NVIT U.S. Growth Leaders Fund (Formerly Gartmore GVIT U.S. Growth Leaders Fund) | FOR 4,972,094.773 shares AGAINST 122,623.161 shares ABSTAIN 174,625.606 shares TOTAL 5,269,343.540 shares | 94.359% 2.327% 3.314% | ||
Gartmore NVIT Worldwide Leaders Fund (Formerly Gartmore GVIT Worldwide Leaders Fund) | FOR 2,666,862.487 shares AGAINST 47,702.491 shares ABSTAIN 118,719.882 shares TOTAL 2,833,284.860 shares | 94.126% 1.684% 4.190% | ||
J.P. Morgan NVIT Balanced Fund (Formerly J.P. Morgan GVIT Balanced Fund) | FOR 15,966,867.546 shares AGAINST 259,004.324 shares ABSTAIN 1,339,385.200 shares TOTAL 17,565,257.070 shares | 90.900% 1.475% 7.625% | ||
Van Kampen NVIT Comstock Value Fund (Formerly Van Kampen GVIT Comstock Value Fund) | FOR 27,737,008.009 shares AGAINST 502,564.164 shares ABSTAIN 1,824,670.107 shares TOTAL 30,064,242.280 shares | 92.259% 1.672% 6.069% | ||
Van Kampen NVIT Multi Sector Bond Fund (Formerly Van Kampen GVIT Multi Sector Bond Fund) | FOR 21,253,297.665 shares AGAINST 484,100.920 shares ABSTAIN 1,803,963.645 shares TOTAL 23,541,362.230 shares | 90.281% 2.056% 7.663% | ||
At the April 25 Meeting, shareholders of the Nationwide NVIT Mid Cap Growth Fund were also asked to approve a new investment subadvisory agreement among the Adviser, the Trust and NorthPointe Capital LLC. The voting results with respect to that proposal are set forth below:
Proposal 2
Number of Shares | ||||
Fund | Cast/Not Cast | Percentages | ||
Nationwide NVIT Mid Cap Growth Fund (Formerly Gartmore GVIT Mid Cap Growth Fund) | FOR 10,862,827.499 shares AGAINST 414,574.660 shares ABSTAIN 672,570.741 shares TOTAL 11,949,972.900 shares | 90.903% 3.469% 5.628% | ||
* | This meeting was previously adjourned on April 23, 2007. | |
** | Fund names were changed effective May 1, 2007 to reflect “Nationwide”/ “NVIT” branding to coincide with the sale of Nationwide Fund Advisors, Inc. by Nationwide Corporation to its majority-owned subsidiary, Nationwide Financial Services, Inc. |
June 30, 2007 (Unaudited)
Contents | ||
6 | Statement of Investments | |
7 | Statement of Assets and Liabilities | |
8 | Statement of Operations | |
9 | Statements of Changes in Net Assets | |
11 | Financial Highlights | |
12 | Notes to Financial Statements |
Statement Regarding Availability of Proxy Voting Record.
SAR-IDMA (8/07) | ![]() |
Dear Fellow Shareholder:
Since I last wrote to you, our mutual funds have enjoyed another period of solid performance, and the corporate realignment that was in progress is now finished.
On May 1, 2007, Nationwide Financial Services, Inc. (NFS), completed its acquisition of the Philadelphia-based retail mutual fund operations of NWD Investment Management, Inc. (formerly, “Gartmore Global Investments, Inc.”), from Nationwide Corporation, a subsidiary of Nationwide Mutual Insurance Company. Effective that date, the acquired entities were renamed Nationwide Funds Group (NFG), and the Gartmore Funds were renamed the Nationwide Funds to better align with the Nationwide® brand. Although the corporate ownership and fund names have changed, I can assure you that NFG intends to maintain as much continuity as possible with the Funds and key personnel.
Thank you, shareholders, for approving the new investment advisory agreement that was required due to the change in corporate ownership. The new agreement is identical in all material respects to the original agreement that it replaces, with the exception of the section pertaining to the vote by the shareholders of the NVIT Mid Cap Growth Fund to approve NorthPointe Capital®, LLC (NorthPointe) as sub-adviser to that particular Fund.
Market Overview: January 1-June 30, 2007
Share prices in general were buoyed in part by better-than-expected first-quarter 2007 earnings and a flurry of mergers and acquisitions, many of these spurred by readily available funding from private equity firms. In June, investors grew more cautious amid surging crude oil prices, a sudden spike in long-term interest rates, and the meltdown of two hedge funds that had exposure to the subprime mortgage market. Looking abroad, a weak U.S. dollar aided foreign stocks, as reflected in the 11.09% advance of the Morgan Stanley Capital International Europe, Australasia and Far East (MSCI EAFE®) Index. Emerging market performance was particularly robust.
The bond market struggled during the first half of 2007. While short-term interest rates remained stable, reflecting the Federal Reserve Board’s decision in June to leave the target federal funds rate at 5.25%, longer-term rates climbed during the first half of 2007, depressing bond prices and forcing the Lehman Brothers® U.S. Aggregate Index to settle for a modest 0.97% return.
We at NFG thank you for your understanding and cooperation throughout our recent transition period. We emerge from this period energized for the future, and we look forward to serving your investment needs for a long time to come.
Nationwide Funds Group
PAST PERFORMANCE IS NO GUARANTEE OF FUTURE RESULTS.
Nationwide Funds are advised by Nationwide Fund Advisors (NFA). NFA is a wholly-owned subsidiary of Nationwide Financial Services. Nationwide Financial Services is a wholly-owned subsidiary of Nationwide Corporation. All of the common stock of Nationwide Corporation is held by Nationwide Mutual (95.2%) and Nationwide Mutual Fire Insurance Company (4.8%), each of which is a mutual company owned by its policyholders.
Nationwide Funds Group (NFG) is the mutual fund arm of Nationwide Financial Services (NYSE: NFS). Based in Conshohocken, Pa., a suburb of Philadelphia, NFG is comprised of Nationwide Fund Advisors, Nationwide Fund Distributors, LLC, and Nationwide Fund Management, LLC. Together, these provide advisory, distribution, and administration services respectively to the Nationwide Funds, and manage more than $43.5 billion in assets as of June 30, 2007, of which more than $12 billion are in “fund of funds” designed to provide asset allocation across several types of investments and asset classes.
Lehman Brothers (LB) U.S. Aggregate Index: An unmanaged, market value-weighted index of investment-grade, fixed-rate debt issues (including government, corporate, asset-backed, and mortgage-backed securities with maturities of one year or more) that is generally representative of the bond market as a whole.
Morgan Stanley Capital International Europe, Australasia and Far East (MSCI EAFE®) Index: An unmanaged, free float-adjusted, market capitalization-weighted index that is designed to measure the performance of stocks in developed markets outside the United States and Canada.
Standard & Poor’s 500® (S&P 500) Index: An unmanaged, market capitalization-weighted index of 500 widely held stocks of large-cap U.S. companies that gives a broad look at how the stock prices of those companies have performed.
Views expressed within are those of Nationwide Funds Group as of the date noted, are subject to change at any time, and may not come to pass.
This report is for informational purposes only, and is not intended as an offer or recommendation with respect to the purchase or sale of any security, option, future, or other derivatives in such securities.
Investing in mutual funds involves risk, including possible loss of principal.
Investors should carefully consider a fund’s investment objectives, risks, fees, charges, and expenses before investing any money. To obtain this and other fund information, please call 800-848-0920 to request a prospectus, or download a prospectus at www.nationwidefunds.com. Please read the prospectus carefully before investing any money.
Nationwide Funds distributed by Nationwide Fund Distributors LLC (formerly Gartmore Distribution Services, Inc.), Member NASD. 1200 River Road, Suite 1000, Conshohocken, Pa. 19428.
Shareholder | Nationwide NVIT Investor Destinations |
As a shareholder of the Fund, you incur two types of costs: (1) transaction costs, including sales charges (loads) paid on purchase payments and redemption fees; and (2) ongoing costs, including investment advisory fees, administration fees, distribution fees and other Fund expenses. The examples below are 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. Per SEC requirements, the examples assume that you had a $1,000 investment in the Class at the beginning of the reporting period, January 1, 2007, and continued to hold your shares at the end of the reporting period, June 30, 2007.
Actual Expenses
Hypothetical Example for Comparison Purposes
Please note that the expenses shown in the table are meant to highlight your ongoing costs only and do not reflect any transaction costs, such as sales charges (loads) or redemption fees. Therefore, the second line for each Class in 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 transaction costs were included, your costs would have been higher. The examples also assume all dividends and distributions have been reinvested.
Schedule of Shareholder Expenses
Nationwide NVIT Investor Destinations | ||||||||||||||||||||||
Moderately Aggressive Fund | ||||||||||||||||||||||
Beginning | Ending | Expenses Paid | Annualized | |||||||||||||||||||
Account Value, | Account | During | Expense | |||||||||||||||||||
January 1, 2007 | Value, | Period*2 | Ratio*2 | |||||||||||||||||||
June 30, 2007 | ||||||||||||||||||||||
Class II | Actual | $ | 1,000.00 | $ | 1,070.30 | $ | 2.77 | 0.54% | ||||||||||||||
Hypothetical | 1 | $ | 1,000.00 | $ | 1,022.12 | $ | 2.71 | 0.54% | ||||||||||||||
Class VI | Actual | $ | 1,000.00 | $ | 1,070.40 | $ | 2.82 | 0.55% | ||||||||||||||
Hypothetical | 1 | $ | 1,000.00 | $ | 1,022.07 | $ | 2.76 | 0.55% | ||||||||||||||
* | Expenses are equal to the Fund’s annualized expense ratio multiplied by the average account value over the period multiplied by 181/365 (to reflect the one-half year period). The expense ratio presented represents a six-month, annualized ratio in accordance with SEC guidelines. The expenses reported above do not include the effect of additional expenses imposed by variable annuity contracts. | |
1 | Represents the hypothetical 5% return before expenses. | |
2 | Expenses are based on the direct expenses of the Fund and do not include the effect of the underlying Funds’ expenses, which are disclosed in the Fee and Expense table and described more fully in a footnote to that table in your Fund prospectus. |
Portfolio Summary | Nationwide NVIT Investor Destinations Moderately Aggressive Fund |
Asset Allocation | ||||
Mutual Funds | 95.1% | |||
Fixed Contract | 4.9% | |||
100.0% |
Asset Allocation Detail | ||||
Equity Funds | 79.9% | |||
Fixed Income Funds | 15.2% | |||
Fixed Contract | 4.9% | |||
100.0% |
Top Holdings | ||||
NVIT S&P 500 Index Fund, ID Class | 34.9% | |||
Nationwide International Index Fund, Institutional Class | 24.7% | |||
Nationwide NVIT Bond Index Fund, ID Class | 15.0% | |||
NVIT Mid Cap Index Fund, ID Class | 14.9% | |||
NVIT Small Cap Index Fund, ID Class | 5.0% | |||
Nationwide Fixed Contract, 3.95% | 4.9% | |||
NVIT International Index Fund, ID Class | 0.4% | |||
Nationwide NVIT Enhanced Income Fund, ID Class | 0.2% | |||
100.0% |
Nationwide NVIT Investor Destinations Moderately Aggressive Fund
Mutual Funds (95.1%) (a) | ||||||||
Shares or | ||||||||
Principal Amount | Value | |||||||
Equity Funds (79.9%) | ||||||||
NVIT Small Cap Index Fund, ID Class | 10,801,027 | $ | 109,630,423 | |||||
Nationwide International Index Fund, Institutional Class | 45,951,140 | 545,899,546 | ||||||
NVIT International Index Fund, ID Class | 821,543 | 9,694,204 | ||||||
NVIT Mid Cap Index Fund, ID Class | 16,467,668 | 330,012,071 | ||||||
NVIT S&P 500 Index Fund, ID Class | 73,589,075 | 770,477,612 | ||||||
Fixed Income Funds (15.2%) | ||||||||
Nationwide NVIT Bond Index Fund, ID Class | 33,793,203 | 332,187,182 | ||||||
Nationwide NVIT Enhanced Income Fund, ID Class | 334,940 | 3,349,404 | ||||||
Total Mutual Funds (Cost $1,920,644,637) | 2,101,250,442 | |||||||
Fixed Contract (4.9%) (a) (b) | ||||||||
Shares or | ||||||||
Principal Amount | Value | |||||||
Nationwide Fixed Contract, 3.95% | $ | 106,940,767 | $ | 106,940,767 | ||||
Total Investments (Cost $2,027,585,404) (c) — 100.0% | 2,208,191,209 | |||||||
Other assets in excess of liabilities — 0.0% | 679,520 | |||||||
NET ASSETS — 100.0% | $ | 2,208,870,729 | ||||||
(a) | Investment in affiliate. | |
(b) | The Nationwide Fixed Contract rate changes quarterly. The security is restricted and as the affiliated counterparty is required by contract to redeem within five days upon request, it has been deemed liquid pursuant to procedures approved by the Board of Trustees. | |
(c) | See notes to financial statements for tax unrealized appreciation (depreciation) of securities. |
See accompanying notes to financial statements.
Nationwide NVIT | ||||||
Investor | ||||||
Destinations Moderately | ||||||
Aggressive Fund | ||||||
Assets: | ||||||
Investments in affiliates, at value (cost $2,027,585,404) | $ | 2,208,191,209 | ||||
Cash | 92 | |||||
Interest and dividends receivable | 23,146 | |||||
Receivable for capital shares issued | 2,251,771 | |||||
Prepaid expenses | 22,098 | |||||
Total Assets | 2,210,488,316 | |||||
Liabilities: | ||||||
Payable for capital shares redeemed | 649,667 | |||||
Accrued expenses and other payables: | ||||||
Investment advisory fees | 235,962 | |||||
Distribution fees | 453,778 | |||||
Administrative servicing fees | 175,701 | |||||
Compliance program costs | 24,086 | |||||
Other | 78,393 | |||||
Total Liabilities | 1,617,587 | |||||
Net Assets | $ | 2,208,870,729 | ||||
Represented by: | ||||||
Capital | $ | 1,860,133,783 | ||||
Accumulated net investment loss | (2,457,129 | ) | ||||
Accumulated net realized gains from investment transactions | 170,588,270 | |||||
Net unrealized appreciation on investments | 180,605,805 | |||||
Net Assets | $ | 2,208,870,729 | ||||
Net Assets: | ||||||
Class II Shares | 2,191,602,254 | |||||
Class VI Shares | 17,268,475 | |||||
Total | $ | 2,208,870,729 | ||||
Shares outstanding (unlimited number of shares authorized): | ||||||
Class II Shares | 161,137,164 | |||||
Class VI Shares | 1,274,795 | |||||
Total | 162,411,959 | |||||
Net asset value and offering price per share (Net assets by class divided by shares outstanding by class, respectively.):* | ||||||
Class II Shares | $ | 13.60 | ||||
Class VI Shares | $ | 13.55 | ||||
* | Not subject to a front-end sales charge. |
7
Nationwide NVIT | |||||
Investor Destinations | |||||
Moderately | |||||
Aggressive Fund | |||||
INVESTMENT INCOME: | |||||
Dividend income | $ | 651,141 | |||
Interest income from affiliates | 2,042,979 | ||||
Dividend income from affiliates | 21,896,970 | ||||
Total Income | 24,591,090 | ||||
Expenses: | |||||
Investment advisory fees | 1,334,175 | ||||
Distribution fees Class II Shares | 2,545,018 | ||||
Distribution fees Class VI Shares | 20,729 | ||||
Administrative servicing fees Class II Shares | 1,412,690 | ||||
Administrative servicing fees Class VI Shares | 12,441 | ||||
Trustee fees | 45,526 | ||||
Compliance program costs (Note 3) | 13,694 | ||||
Other | 177,552 | ||||
Total expenses before earnings credit | 5,561,825 | ||||
Earnings credit (Note 6) | (107 | ) | |||
Net Expenses | 5,561,718 | ||||
Net Investment Income | 19,029,372 | ||||
REALIZED/ UNREALIZED GAINS (LOSSES) FROM INVESTMENTS: | |||||
Realized gains on investment transactions with affiliates | 151,997,438 | ||||
Realized gain distributions from underlying funds | 19,295,422 | ||||
Net realized gains on investment transactions | 171,292,860 | ||||
Net change in unrealized depreciation on investments | (50,200,240 | ) | |||
Net realized/unrealized gains (losses) on investments | 121,092,620 | ||||
CHANGE IN NET ASSETS RESULTING FROM OPERATIONS | $ | 140,121,992 | |||
8
Nationwide NVIT Investor | |||||||||
Destinations Moderately Aggressive Fund | |||||||||
Six Months Ended | Year Ended | ||||||||
June 30, 2007 | December 31, 2006 | ||||||||
(Unaudited) | |||||||||
FROM INVESTMENT ACTIVITIES: | |||||||||
Operations: | |||||||||
Net investment income | $ | 19,029,372 | $ | 29,797,318 | |||||
Net realized gains on investment transactions | 171,292,860 | 49,012,199 | |||||||
Net change in unrealized appreciation/depreciation on investment transactions | (50,200,240 | ) | 132,025,065 | ||||||
Change in net assets resulting from operations | 140,121,992 | 210,834,582 | |||||||
Distributions to shareholders from: | |||||||||
Net investment income: | |||||||||
Class II | (24,058,965 | ) | (35,276,724 | ) | |||||
Class VI | (204,011 | ) | (229,357 | ) | |||||
Net realized gains on investments: | |||||||||
Class II | (41,053,058 | ) | (18,562,857 | ) | |||||
Class VI | (320,408 | ) | (101,698 | ) | |||||
Change in net assets from shareholder distributions | (65,636,442 | ) | (54,170,636 | ) | |||||
Change in net assets from capital transactions | 241,522,754 | 526,525,287 | |||||||
Change in net assets | 316,008,304 | 683,189,233 | |||||||
Net Assets: | |||||||||
Beginning of period | 1,892,862,425 | 1,209,673,192 | |||||||
End of period | $ | 2,208,870,729 | $ | 1,892,862,425 | |||||
Accumulated net investment income (loss) at end of period | $ | (2,457,129 | ) | $ | 2,776,475 | ||||
CAPITAL TRANSACTIONS: | |||||||||
Class II Shares | |||||||||
Proceeds from shares issued | $ | 213,944,086 | $ | 522,869,063 | |||||
Dividends reinvested | 65,111,933 | 53,839,471 | |||||||
Cost of shares redeemed (a) | (42,082,514 | ) | (53,814,683 | ) | |||||
236,973,505 | 522,893,851 | ||||||||
Class VI Shares | |||||||||
Proceeds from shares issued | 7,770,460 | 6,561,532 | |||||||
Dividends reinvested | 524,418 | 331,055 | |||||||
Cost of shares redeemed (a) | (3,745,629 | ) | (3,261,151 | ) | |||||
4,549,249 | 3,631,436 | ||||||||
Change in net assets from capital transactions | $ | 241,522,754 | $ | 526,525,287 | |||||
SHARE TRANSACTIONS: | |||||||||
Class II Shares | |||||||||
Issued | 15,828,522 | 42,081,999 | |||||||
Reinvested | 4,813,029 | 4,367,597 | |||||||
Redeemed | (3,095,391 | ) | (4,336,564 | ) | |||||
17,546,160 | 42,113,032 | ||||||||
9
Nationwide NVIT Investor | |||||||||
Destinations Moderately Aggressive Fund | |||||||||
Six Months Ended | Year Ended | ||||||||
June 30, 2007 | December 31, 2006 | ||||||||
(Unaudited) | |||||||||
SHARE TRANSACTIONS: (continued) | |||||||||
Class VI Shares | |||||||||
Issued | 585,368 | 522,334 | |||||||
Reinvested | 38,923 | 26,815 | |||||||
Redeemed | (277,067 | ) | (262,144 | ) | |||||
347,224 | 287,005 | ||||||||
Total change in shares | 17,893,384 | 42,400,037 | |||||||
(a) | Includes redemption fees, if any. |
10
Distributions | ||||||||||||||||||||
Investment Activities | ||||||||||||||||||||
Net Realized | ||||||||||||||||||||
and | ||||||||||||||||||||
Net Asset | Unrealized | Total | ||||||||||||||||||
Value, | Net | Gains | from | Net | ||||||||||||||||
Beginning | Investment | (Losses) on | Investment | Investment | ||||||||||||||||
of Period | Income | Investments | Activities | Income | ||||||||||||||||
Class II Shares | ||||||||||||||||||||
For the year ended December 31, 2002 | $ | 10.09 | 0.12 | (1.59 | ) | (1.47 | ) | (0.12 | ) | |||||||||||
For the year ended December 31, 2003 | $ | 8.49 | 0.14 | 2.10 | 2.24 | (0.13 | ) | |||||||||||||
For the year ended December 31, 2004 (e) | $ | 10.60 | 0.19 | 1.08 | 1.27 | (0.19 | ) | |||||||||||||
For the year ended December 31, 2005 | $ | 11.52 | 0.24 | 0.57 | 0.81 | (0.24 | ) | |||||||||||||
For the year ended December 31, 2006 | $ | 11.85 | 0.23 | 1.45 | 1.68 | (0.27 | ) | |||||||||||||
For the six months ended June 30, 2007 (Unaudited) | $ | 13.10 | 0.12 | 0.80 | 0.92 | (0.16 | ) | |||||||||||||
Class VI Shares | ||||||||||||||||||||
Period ended December 31, 2004 (f) | $ | 10.63 | 0.17 | 0.98 | 1.15 | (0.17 | ) | |||||||||||||
For the year ended December 31, 2005 | $ | 11.51 | 0.25 | 0.57 | 0.82 | (0.26 | ) | |||||||||||||
For the year ended December 31, 2006 | $ | 11.83 | 0.24 | 1.44 | 1.68 | (0.29 | ) | |||||||||||||
For the six months ended June 30, 2007 (Unaudited) | $ | 13.06 | 0.11 | 0.80 | 0.91 | (0.16 | ) | |||||||||||||
[Additional columns below]
[Continued from above table, first column(s) repeated]
Distributions | ||||||||||||||||||||||||
Net Assets | Ratio of | |||||||||||||||||||||||
Net | Net Asset | at End of | Expenses | |||||||||||||||||||||
realized | Total | Value, End | Total | Period | to Average | |||||||||||||||||||
gains | Distributions | of Period | Return (a) | (000s) | Net Assets (b) | |||||||||||||||||||
Class II Shares | ||||||||||||||||||||||||
For the year ended December 31, 2002 | (0.01 | ) | (0.13 | ) | $ | 8.49 | (14.59% | ) | $ | 71,962 | 0.56% | |||||||||||||
For the year ended December 31, 2003 | – | (0.13 | ) | $ | 10.60 | 26.64% | $ | 290,666 | 0.56% | |||||||||||||||
For the year ended December 31, 2004 (e) | (0.16 | ) | (0.35 | ) | $ | 11.52 | 12.09% | $ | 734,244 | 0.55% | ||||||||||||||
For the year ended December 31, 2005 | (0.24 | ) | (0.48 | ) | $ | 11.85 | 7.07% | $ | 1,202,098 | 0.57% | ||||||||||||||
For the year ended December 31, 2006 | (0.16 | ) | (0.43 | ) | $ | 13.10 | 14.54% | $ | 1,880,752 | 0.57% | ||||||||||||||
For the six months ended June 30, 2007 (Unaudited) | (0.26 | ) | (0.42 | ) | $ | 13.60 | 7.03% | $ | 2,191,602 | 0.54% | ||||||||||||||
Class VI Shares | ||||||||||||||||||||||||
Period ended December 31, 2004 (f) | (0.10 | ) | (0.27 | ) | $ | 11.51 | 10.92% | $ | 2,751 | 0.41% | ||||||||||||||
For the year ended December 31, 2005 | (0.24 | ) | (0.50 | ) | $ | 11.83 | 7.16% | $ | 7,575 | 0.48% | ||||||||||||||
For the year ended December 31, 2006 | (0.16 | ) | (0.45 | ) | $ | 13.06 | 14.56% | $ | 12,112 | 0.56% | ||||||||||||||
For the six months ended June 30, 2007 (Unaudited) | (0.26 | ) | (0.42 | ) | $ | 13.55 | 7.04% | $ | 17,268 | 0.55% | ||||||||||||||
[Additional columns below]
[Continued from above table, first column(s) repeated]
Ratios/Supplemental Data | ||||||||||||||||||
Ratio of Net | ||||||||||||||||||
Ratio of | Investment | |||||||||||||||||
Ratio of Net | Expenses | Income | ||||||||||||||||
Investment | (Prior to | (Prior to | ||||||||||||||||
Income | Reimbursements) | Reimbursements) | ||||||||||||||||
to Average | to Average | to Average | Portfolio | |||||||||||||||
Net Assets (b) | Net Assets (b)(c) | Net Assets (b)(c) | Turnover (d) | |||||||||||||||
Class II Shares | ||||||||||||||||||
For the year ended December 31, 2002 | 1.89% | (g) | (g) | 43.38% | ||||||||||||||
For the year ended December 31, 2003 | 1.73% | (g) | (g) | 22.22% | ||||||||||||||
For the year ended December 31, 2004 (e) | 2.11% | (g) | (g) | 11.44% | ||||||||||||||
For the year ended December 31, 2005 | 2.23% | (g) | (g) | 7.53% | ||||||||||||||
For the year ended December 31, 2006 | 1.97% | (g) | (g) | 5.40% | ||||||||||||||
For the six months ended June 30, 2007 (Unaudited) | 1.84% | 0.54% | 1.84% | 64.52% | ||||||||||||||
Class VI Shares | ||||||||||||||||||
Period ended December 31, 2004 (f) | 4.26% | (g) | (g) | 11.44% | ||||||||||||||
For the year ended December 31, 2005 | 2.59% | (g) | (g) | 7.53% | ||||||||||||||
For the year ended December 31, 2006 | 1.99% | (g) | (g) | 5.40% | ||||||||||||||
For the six months ended June 30, 2007 (Unaudited) | 1.85% | 0.55% | 1.85% | 64.52% | ||||||||||||||
(a) | Not annualized for periods less than one year. | |
(b) | Annualized for periods less than one year. | |
(c) | During the period, certain fees were waived and/or reimbursed. If such waivers/reimbursements had not occurred, the ratios would have been as indicated. | |
(d) | Portfolio turnover is calculated on the basis of the Fund as a whole without distinguishing among the classes of shares. | |
(e) | On April 30, 2004, the existing share Class of the Fund was renamed Class II Shares. | |
(f) | For the period from April 30, 2004 (commencement of operations) through December 31, 2004. | |
(g) | There were no fee reductions during the period. |
See accompanying notes to financial statements.
1. | Organization |
Nationwide Variable Insurance Trust (“NVIT” or the “Trust”) is an open-end management investment company, organized under the laws of Delaware by an amended and restated Agreement and Declaration of Trust, dated October 28, 2004, as amended to date. Prior to May 1, 2007, the Trust was named “Gartmore Variable Insurance Trust”. The Trust, originally created under the laws of Massachusetts as a Massachusetts business trust pursuant to a Declaration of Trust dated, as of June 30, 1981, and as subsequently amended, redomesticated as a Delaware Statutory Trust after the close of trading on April 29, 2005, and is registered under the Investment Company Act of 1940, as amended (the “1940 Act”). The redomestication was a change in statutory status and did not affect the operations of the Trust. As of June 30, 2007, the Trust had authorized an unlimited number of shares of beneficial interest, without par value (“shares”). The Trust currently offers shares to life insurance company separate accounts to fund the benefits under variable life insurance or annuity policies. To date, only the separate accounts of Nationwide Life Insurance Company and Nationwide Life and Annuity Insurance Company (collectively, “Nationwide”) have purchased shares of the Nationwide NVIT Investor Destinations Moderately Aggressive Fund (the “Fund”) (formerly, “Gartmore GVIT Investor Destinations Moderately Aggressive Fund”). The Trust currently operates forty (40) separate series, or mutual funds, each with its own investment objectives and strategies. This report contains the financial statements and financial highlights of the Fund.
The Fund is constructed as a “fund of funds,” which means that the Fund pursues its investment objective by allocating the Fund’s investments primarily among other mutual funds (the “Underlying Funds”). The Underlying Funds typically invest, either directly or indirectly, in stocks, bonds, and other securities, including the Nationwide Contract. The Nationwide Contract is a fixed interest contract issued and guaranteed by Nationwide Life Insurance Company (“Nationwide”). This contract has a stable principal value and will pay the Fund a fixed rate of interest. The fixed interest rate must be at least 3.50% (on an annual basis), but may be higher and is currently adjusted on a quarterly basis. Nationwide will calculate the interest rate in the same way that it calculates guaranteed interest rates for similar contracts. Because the contract is guaranteed by Nationwide, assuming no default, the Fund receives no more or less than the guaranteed amount and will not directly participate in the actual experience of the assets underlying the contract. Although under certain market conditions the Fund’s performance may be hurt by its investment in the Nationwide Contract, the portfolio management team believes that the relatively stable nature of the Nationwide Contract should reduce the Fund’s volatility and overall risk, especially when the bond and stock markets decline simultaneously. The Fund’s target allocation range is 0-10%.
2. | Summary of Significant Accounting Policies |
The following is a summary of significant accounting policies followed by the Fund in the preparation of its financial statements. The policies are in conformity with accounting principles generally accepted in the United States of America (“GAAP”). The preparation of financial statements requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of income and expenses for the period. Actual results could differ from those estimates.
(a) | Security Valuation |
Shares of the Underlying Funds in which the Fund invests are valued at their respective net asset values as reported by the Underlying Funds. The securities in the Underlying Funds generally are valued as of the close of business of the regular session of trading on the New York Stock Exchange (usually at 4 p.m. Eastern time). The Underlying Funds generally value securities and assets at current market value. Under most circumstances, the fixed interest contract is valued at par value each day, which is deemed to be fair value. The par value is calculated each day by the summation of the following factors: prior day’s par value; prior day’s interest accrued (par multiplied by guaranteed fixed rate); and current day net purchase or redemption. | |
The following policies, (b) through (h), represent the accounting policies applicable to the Underlying Funds. |
(b) | Repurchase Agreements |
The Fund may enter into repurchase agreements with an entity which is a member of the Federal Reserve System or which is a “primary dealer” (as designated by the Federal Reserve Bank of New York) in U.S. Government obligations. The repurchase price generally equals the price paid by the Fund plus interest negotiated on the basis of current short-term rates, which may be more or less than the rate on the underlying portfolio securities. The seller under a repurchase agreement is required to maintain the value of the collateral held pursuant to the agreement at a market value equal to or greater than the repurchase price (including accrued interest). Collateral subject to repurchase agreements is held by the Fund’s custodian or another qualified sub-custodian or in the Federal Reserve/ Treasury book-entry system. If the counterparty defaults and the fair value of the collateral declines, realization of the collateral by the Fund may be delayed or limited. The Fund may transfer uninvested cash balances into a pooled cash account. These balances are invested in one or more repurchase agreements, with the counterparty of Nomura Securities, which is fully collateralized by U.S. Government Agency Mortgages. |
(c) | Foreign Currency Transactions |
The accounting records of the Fund are maintained in U.S. dollars. Foreign currency amounts are translated into U.S. dollars at the current rate of exchange to determine the value of investments, assets and liabilities. The Fund may enter into foreign currency contracts in connection with purchases or sales of securities denominated in a foreign currency. Purchases and sales of securities, and income and expenses, are translated at the prevailing rate of exchange on the respective date of these transactions. The Fund does not isolate that portion of the results of operations resulting from changes in foreign exchange rates on investments from fluctuations arising from changes in market prices of securities held. These fluctuations are included with the net realized and unrealized gain or loss from investments and foreign currencies. |
(d) | Forward Foreign Currency Contracts |
The Fund may enter into forward foreign currency contracts in connection with planned purchases or sales of securities or to hedge the U.S. dollar value of portfolio securities denominated in a particular currency. The Fund could be exposed to risks if the counterparties to the contracts are unable to meet the terms of their contracts and from unanticipated movements in the value of a foreign currency relative to the U.S. dollar. Forward foreign currency contracts are valued at the current cost of covering these contracts, as provided by an independent pricing service approved by the Trust’s Board of Trustees (“Board of Trustees”). The forward foreign currency contracts are adjusted by the daily exchange rate of the underlying currency and any gains or losses are recorded for financial statement purposes as unrealized gains or losses until the contract settlement date. |
(e) | Futures Contracts |
The Fund may invest in financial futures contracts (“futures contracts”) for the purpose of hedging its existing portfolio securities or securities that the Fund intends to purchase against fluctuations in value caused by changes in prevailing market interest rates or prices. Futures contracts may also be entered into for non-hedging purposes. | |
Upon entering into a futures contract, the Fund is required to pledge to the broker an amount of cash and/or other assets equal to a certain percentage of the contract amount (initial margin deposit). Subsequent payments, known as “variation margin,” are made each day, depending on the daily fluctuations in the fair value/ market value of the underlying assets. A gain or loss equal to the daily variation margin is recognized on a daily basis. Futures contracts are valued daily at their last quoted sale price. | |
A “sale” of a futures contract means the creation of a contractual obligation to deliver the securities or foreign currency called for by the contract at a fixed price at a specified time in the future. A “purchase” of a futures contract means the creation of a contractual obligation to acquire the securities or foreign currency at a fixed price at a specified time in the future. |
Should market conditions change unexpectedly, the Fund may not achieve the anticipated benefits of the futures contracts and may realize a loss. The use of futures transactions for hedging purposes involves the risk of imperfect correlation in movements in the price of futures contracts, interest rates, and the value of the underlying hedged assets. |
(f) | Written Options Contracts |
The Fund may write options contracts. A written option obligates the Fund to deliver (written call) or to receive (written put) a specified quantity of an underlying asset at the contract amount upon exercise by the holder of the option. When the Fund writes an option, an amount equal to the premium received by the Fund is recorded as a liability and is subsequently adjusted to the current fair value of the option written. Premiums received from writing options that expire unexercised are treated by the Fund on the expiration date as realized gains from investments. The difference between the premium and the amount paid on effecting a closing purchase transaction, as a realized loss. If a call option is exercised, the premium is added to the proceeds from the sale of the underlying security or currency in determining whether the Fund has realized a gain or loss. If a put option is exercised, the premium reduces the cost basis of the securities purchased by the Fund. Options traded on an exchange are valued at the last quoted sale price, or in the absence of a sale, the bid price provided by an independent pricing service approved by the Board of Trustees. Non-exchange traded options are valued using dealer supplied quotes. The Fund as a writer of an option bears the market risk of an unfavorable change in the price of the security underlying the written option. |
(g) | Mortgage Dollar Rolls |
The Fund may enter into mortgage “dollar rolls” in which the Fund sells mortgage-backed securities for delivery in the current month and simultaneously contracts to repurchase substantially similar (same type, coupon, and maturity) securities on a specified future date. Mortgage dollar rolls may be implemented in the “to be announced” (“TBA”) market and are referred to as TBAs on the Statement of Investments of the Fund. During the roll period, the Fund foregoes principal and interest paid on the mortgage-backed securities. Each mortgage dollar roll is treated as a financing transaction; therefore, any gain or loss is considered unrealized until the roll reaches completion. Risks may arise due to the delayed payment date and the potential inability of counterparties to complete the transaction. Income is generated as consideration for entering into these transactions and is included in interest income on the Statement of Operations. |
(h) | Short Sales |
The Fund is authorized to engage in short-selling of portfolio securities which obligates the Fund to replace any security that the Fund has borrowed by purchasing the security at current market value sometime in the future. The Fund will incur a loss if the price of the security increases between the date of the short sale and the date on which the Fund replaces the borrowed security. The Fund generally will realize a gain if the price of the security declines between these dates. Until the Fund replaces the borrowed security, the Fund will maintain a segregated account with cash, U.S. Government securities and/or securities held long to sufficiently cover the Fund’s short position on a daily basis. Dividends declared on securities sold short are recorded as an expense on the ex-dividend date and paid to the counterparty on the dividend pay date. |
(i) | Security Transactions and Investment Income |
Security transactions are accounted for on the date the security is purchased or sold (“trade date”). Securities gains and losses are calculated on the identified cost basis. Interest income is recognized on the accrual basis and includes, where applicable, the amortization or accretion of premium or discount. |
(j) | Distributions to Shareholders |
The Fund’s dividends from net investment income, if any, are declared and paid quarterly. The Fund’s distributions from net realized capital gains, if any, are declared and distributed at least annually. |
Dividends and distributions to shareholders are determined in accordance with federal income tax regulations, which may differ from GAAP. These “book/tax” differences are considered either permanent or temporary in nature. In accordance with the American Institute of Certified Public Accountants Statement of Position 93-2, permanent differences (i.e., reclassification of market discounts, foreign exchange gain/ loss, paydowns, and distributions from real estate investment trusts) are reclassified within the capital accounts based on their nature for federal income tax purposes; temporary differences do not require reclassification. These reclassifications have no effect upon the net asset value of the Fund. To the extent distributions exceed current and accumulated earnings and profits for federal income tax purposes, these distributions are reported as distributions of paid-in-capital. |
(k) | Federal Income Taxes |
It is the policy of the Fund to qualify or to continue to qualify as a “regulated investment company” by complying with the provisions available to certain investment companies, as defined in Subchapter M of the U.S. Internal Revenue Code, and to make distributions of net investment income and net realized capital gains sufficient to relieve the Fund from all, or substantially all, federal income taxes. | |
As of June 30, 2007, the tax cost of securities and the breakdown of unrealized appreciation (depreciation) for the Fund was as follows: |
Net | ||||||||||||||||
Unrealized | ||||||||||||||||
Tax Cost of | Unrealized | Unrealized | Appreciation | |||||||||||||
Securities | Appreciation | Depreciation | (Depreciation) | |||||||||||||
$ | 2,027,636,244 | $ | 186,152,211 | $ | (5,597,246 | ) | $ | 180,554,965 | ||||||||
(l) | Allocation of Expenses, Income, and Gains and Losses |
Expenses directly attributable to the Fund are charged to the Fund. Expenses not directly attributable to the Fund are allocated proportionately among various or all funds within the Trust. The method used by the Fund for allocating income, fund level expenses, and realized and unrealized gains or losses is based on the fair value of shares outstanding relative to net assets. Under this method, each class of shares participates based on the total net asset value of that class’s shares in proportion to the total net assets of the Fund. Expenses specific to a class (such as Rule 12b-1 and administrative services fees) are charged to that class. |
3. Transactions with Affiliates
Under the terms of the Trust’s Investment Advisory Agreement, Nationwide Fund Advisors (formerly, Gartmore Mutual Fund Capital Trust (“GMF”)) (“NFA” or the “Advisor”) manages the investment of the assets and supervises the daily business affairs of the Fund. NFA is a wholly-owned subsidiary of Nationwide Financial Services (“NFS”).
Under the terms of the Investment Advisory Agreement, the Fund pays NFA an investment advisory fee of 0.13% based on the Fund’s average daily net assets.
Under the terms of a Fund Administration and Transfer Agency Agreement, Nationwide Fund Management, LLC (formerly, Gartmore Investor Services, Inc. (“GISI”)) (“NFM”), a wholly-owned subsidiary of NFS Distributors, Inc. (“NFSDI”), provides various administrative and accounting services for the Funds (prior to May 1, 2007, this service was provided by Gartmore SA Capital Trust (“GSA”)), and, serves as Transfer Agent and Dividend Disbursing Agent for each of the Funds (prior to May 1, 2007, this service was provided by GISI, an indirect subsidiary of GSA). The Funds do not pay a fee for these.
NFA and NFM have entered into agreements with Citi Fund Services Ohio, Inc. (“Citi”), pursuant to which Citi provides sub-administration and sub-transfer agency services, respectively, to the Fund. Effective August 1, (2007), The BISYS Group Inc. was acquired by and became a wholly owned subsidiary of Citi.
Under the terms of a Distribution Plan under Rule 12b-1 of the 1940 Act, Nationwide Fund Distributors, LLC. (formerly, “Gartmore Distribution Services, Inc. (“GDSI”)) (“NFD” or “Distributor”), the Fund’s principal underwriter, is compensated by the Fund for expenses associated with the distribution of the Class II and Class VI shares of the Fund. NFD is a wholly-owned subsidiary of NFSDI. These fees are based on average daily net assets of each class of shares of the Fund at an annual rate not to exceed 0.25%.
Under the terms of an Administrative Services Plan, the Fund may pay fees to servicing organizations, such as broker-dealers, including NFS, and financial institutions, which agree to provide administrative support services to the shareholders of certain classes. These services include, but are not limited, to the following: establishing and maintaining shareholder accounts; processing purchase and redemption transactions; arranging bank wires; performing shareholder sub-accounting; answering inquires regarding the Fund; and other such services. These fees are based on an annual rate of up to 0.25% of the average daily net assets of each class of shares of the Fund.
For the six months ended June 30, 2007, NFS received $1,540,900 in Administrative Services Fees from the Fund.
Under the terms of a letter agreement dated September 12, 2006, by and among NFA, the Audit Committee of the Trust and the Trust, the Trust has agreed to reimburse NFA certain costs related to the Fund’s portion of ongoing administration, monitoring and annual (audit) testing of the Trust’s Rule 38a-1 Compliance Program subject to the pre-approval of the Trust’s Audit Committee. For the six months ended June 30, 2007, the Fund’s portion of such costs amounted to $13,694.
Because the Fund invests primarily in other affiliated funds, the Fund is a shareholder of those Underlying Funds. The Underlying Funds do not charge the Fund any sales charge for buying or selling shares. However, the Fund indirectly pays a portion of the operating expenses, including management fees of the Underlying Funds and short-term investments the Fund holds. These expenses are deducted from the Underlying Funds before their share prices are calculated and are in addition to the fees and expenses of the Fund. Actual indirect expenses vary depending on how the Fund’s assets are spread among the underlying investments.
4. Short-Term Trading Fees
The Fund reserves the right to assess a short-term trading fee on certain transactions out of Class VI shares that a separate account makes on behalf of a variable insurance contract owner (the “contract owner”). A separate account that redeems Class VI shares on behalf of a contract owner may be subject to a 1.00% short-term trading fee if the separate account held the Class VI shares on behalf of the contract owner for 60 days or less, unless an exception applies as disclosed in the Fund’s prospectus. The short-term trading fee is paid directly to the Fund and is intended to offset the cost to the Fund of excess brokerage commissions and other costs associated with fluctuations in Fund asset levels and cash flow caused by short-term trading. For purposes of determining whether the short-term trading fee applies, the Class VI shares that were held on behalf of the contract owner the longest will be treated as being redeemed first.
For the six months ended June 30, 2007, the Fund had contributions to capital due to collection of redemption fees in the amount of $12,627.
5. Investment Transactions
For the six months ended June 30, 2007, (excluding short-term securities) the Fund had purchases of $1,437,630,314 and sales of $1,269,500,216.
6. Bank Loans and Earnings Credit
The Trust has a credit agreement with JPMorgan Chase & Co., the Fund’s custodian bank, permitting the Trust to borrow up to $100,000,000. Borrowings under this arrangement bear interest at the Federal Funds rate plus 0.50%. The interest costs, if any, would be included in other fees in the Statement of Operations. No compensating balances were required under the terms of the line of credit. The line of credit is renewed annually, expiring on June 25, 2008, with a
The Trust’s custodian bank has agreed to reduce the bank’s fees (earnings credit) when the funds of the Trust maintain cash on deposit in non-interest-bearing custody and Demand Deposit Accounts. Earnings credits, if any, are shown as a reduction of total expenses on the Statement of Operations.
7. Portfolio Investment Risks
Risks Associated with Foreign Securities and Currencies. Investments in securities of foreign issuers carry certain risks not ordinarily associated with investments in securities of U.S. issuers. These risks include future political and economic developments, and the possible imposition of exchange controls or other foreign governmental laws and restrictions. In addition, with respect to certain countries, there is the possibility of expropriation of assets, confiscatory taxation, political or social instability, or diplomatic developments, which could adversely affect investments in those countries.
Certain countries also may impose substantial restrictions on investments in their capital markets by foreign entities, including restrictions on investments in issuers of industries deemed sensitive to relevant national interests. These factors may limit the investment opportunities available and result in a lack of liquidity and high price volatility with respect to securities of issuers from developing countries.
8. Indemnifications
Under the Trust’s organizational documents, certain of the Trust’s Officers and Trustees are indemnified against certain liabilities arising out of the performance of their duties to the Trust. In addition, the Trust has entered into Indemnification Agreements with the Trust’s trustees and certain officers covering similar liabilities. Trust Officers receive no compensation from the Trust for serving as the Trust’s Officers. In addition, in the normal course of business, the Trust enters into contracts with its vendors and others that provide for general indemnifications. The Trust’s maximum exposure under these arrangements is unknown, as this would involve future claims that may be made against the Trust. Based on experience, however, the Trust expects that risk of loss to be remote.
9. Recently Issued Accounting Pronouncements
On July 13, 2006, the Financial Accounting Standards Board (“FASB”) released FASB Interpretation No. 48, Accounting for Uncertainty in Income Taxes (“FIN 48”). FIN 48 provides guidance for how uncertain tax positions should be recognized, measured, presented and disclosed in the financial statements. FIN 48 requires the affirmative evaluation of tax positions taken or expected to be taken in the course of preparing the Fund’s tax returns to determine whether it is more-likely-than-not (i.e., greater than 50 percent) that each tax position will be sustained upon examination by a taxing authority based on the technical merits of the position. A tax position that meets the more-likely-than-not recognition threshold is measured to determine the amount of benefit to recognize in the financial statements. Differences between tax positions taken in a tax return and amounts recognized in the financial statements will generally result in an increase in a liability for taxes payable (or a reduction of a tax refund receivable) and an increase in a deferred tax liability (or a reduction in a deferred tax asset). Adoption of FIN 48 was required no later than the last business day of the first financial statement reporting period for fiscal years beginning after December 15, 2006 and is to be applied to all open tax years as of the effective date. Accordingly, the Fund was required to implement FIN 48 in its net asset value per share (NAV) calculation on June 29, 2007. Management has evaluated the implications of FIN 48 and has concluded that there was no impact to the Fund’s financial statements as of June 29, 2007. The adoption of FIN 48 requires ongoing monitoring and analysis, future conclusions reached by management may be different and result in adjustments to the Fund’s NAV and financial statements.
In September 2006, the FASB issued Statement on Financial Accounting Standards (“SFAS”) No. 157, “Fair Value Measurements.” This standard establishes a single authoritative definition of fair value, sets out a framework for measuring fair value and requires additional disclosures about fair value measurements. SFAS No. 157 applies to fair value measurements already required or permitted by existing standards. SFAS No. 157 is effective for financial statements
Trustees who are not Interested Persons (as defined in the 1940 Act) and Officers of the Trust as of
Number of Portfolios | ||||||||||
Position(s) Held | in the | |||||||||
with the Trust | Principal Occupation(s) | Nationwide Fund | Other | |||||||
Name, Address | and Length of | During Past | Complex Overseen | Directorships | ||||||
and Year of Birth | Time Served1 | Five Years | by Trustee | Held by Trustee2 | ||||||
Charles E. Allen c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1948 | Trustee since July 2000 | Mr. Allen is Chairman, Chief Executive Officer and President of Graimark Realty Advisors, Inc. (real estate development, investment and asset management). | 89 | None | ||||||
Paula H.J. Cholmondeley c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1947 | Trustee since July 2000 | Ms. Cholmondeley was Vice President and General Manager of Sappi Fine Paper North America from April 2000 through December 2003. | 89 | Director of Dentsply International, Inc. (dental products), Ultralife Batteries, Inc., Terex Corporation (construction equipment), Minerals Technology, Inc. (specialty chemicals) and Albany International Corp. (paper industry) | ||||||
C. Brent DeVore3 c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1940 | Trustee since 1990 | Dr. DeVore is President of Otterbein College. | 89 | None | ||||||
Phyllis Kay Dryden c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1947 | Trustee since December 2004 | Ms. Dryden was a partner of Mitchell Madison, a management consulting company from January 2006 until December 2006; she is currently a consultant with the company. Ms. Dryden was formerly Managing Partner of march FIRST, a global management consulting firm. | 89 | None | ||||||
Barbara L. Hennigar c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1935 | Trustee since July 2000 | Retired. | 89 | None |
Number of Portfolios | ||||||||||
Position(s) Held | in the | |||||||||
with the Trust | Principal Occupation(s) | Nationwide Fund | Other | |||||||
Name, Address | and Length of | During Past | Complex Overseen | Directorships | ||||||
and Year of Birth | Time Served1 | Five Years | by Trustee | Held by Trustee2 | ||||||
Barbara I. Jacobs c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1950 | Trustee since December 2004 | Ms. Jacobs served as Chairman of the Board of Directors of KICAP Network Fund, a European (United Kingdom) hedge fund, from January 2001 through January 2006. From 1998-2003, Ms. Jacobs was also a Managing Director and European Portfolio Manager of CREF Investments (Teachers Insurance and Annuity Association-College Retirement Equities Fund). | 89 | None | ||||||
Douglas F. Kridler c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1955 | Trustee since September 1997 | Mr. Kridler has served as the President and Chief Executive Officer of the Columbus Foundation (a Columbus, OH-based foundation which manages over 1,300 individual endowment funds) since February 2002. Prior to January 31, 2002, Mr. Kridler was the President of the Columbus Association for the Performing Arts and Chairman of the Greater Columbus Convention and Visitors Bureau. | 89 | None | ||||||
Michael D. McCarthy c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1947 | Trustee since December 2004 | Retired. Mr. McCarthy was Chairman of VMAC (commodity swaps) from October 2002 until January 2007; and a partner of Pineville Properties LLC (a commercial real estate development firm) from September 2000 until January 2007. | 89 | None | ||||||
David C. Wetmore c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1948 | Trustee since 1995 and Chairman since February 2005 | Retired. | 89 | None | ||||||
1 | Length of time served includes time served with the Trust’s predecessors. | |
2 | Directorships held in (1) any other investment companies registered under the 1940 Act, (2) any company with a class of securities registered pursuant to Section 12 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or (3) any company subject to the requirements of Section 15(d) of the Exchange Act. | |
3 | Mr. DeVore has served as President of Otterbein College since 1984. Mark Thresher, President and Chief Operating Officer of Nationwide Financial Services, Inc. (“NFS”) has served as a member of the Board of Trustees of Otterbein College since 2000, currently serves as one of 30 of its trustees, and is currently one of two Vice Chairmen of the Board. Each of Nationwide Fund Advisors (“NFA”), the Funds’ investment adviser, and Nationwide Fund Distributors LLC (“NFD”), principal underwriter to the Trust, is a wholly-owned subsidiary of NFS. | |
Additional information regarding the Trustees and Officers may be found in the Trust’s Statement of Additional Information, which is available without charge upon request, by calling 800-848-0920. |
Trustees who are Interested Persons (as defined in the 1940 Act) and/or Officers of the Trust as of
Number of Portfolios | ||||||||||
Position(s) Held | in the | |||||||||
with the Trust | Principal Occupation(s) | Nationwide Fund | Other | |||||||
Name, Address | and Length of | During Past | Complex Overseen | Directorships | ||||||
and Year of Birth | Time Served1 | 5 Years | by Trustee | Held by Trustee 2 | ||||||
Arden L. Shisler c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1941 | Trustee since February 2000 | Retired. Mr. Shisler is the former President and Chief Executive Officer of KeB Transport, Inc., a trucking firm (2000 through 2002). He served as a consultant to KeB from January 2003 through December 2004. Since 1992, Mr. Shisler has also been Chairman of the Board for Nationwide Mutual Insurance Company.3 | 89 | Director of Nationwide Financial Services, Inc., Chairman of Nationwide Mutual Insurance Company3 | ||||||
John H. Grady Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1961 | President & Chief Executive Officer since December 2006 | Mr. Grady is President, and Chief Executive Officer of Nationwide Funds Group which includes Nationwide Fund Advisors,3 Nationwide Fund Management LLC,3 Nationwide Fund Distributors LLC 3 and NWD Investments,2 the asset management operations of Nationwide Mutual Insurance Company, which includes Morley Capital Management, Inc.,2 Nationwide Separate Accounts LLC,2 NorthPointe Capital LLC,2 and Nationwide SA Capital Trust2. From March 2004 until March 2006, Mr. Grady was Chief Executive Officer of Constellation Investment Management Co., L.P. (registered investment adviser), and President and Chief Executive Officer of Constellation Funds Group (registered investment companies). He also was President of Constellation Investment Distribution Co., Inc. (registered broker-dealer) from March 2004 until June 2006. From February 2001 until February 2004, Mr. Grady was Chief Operating and Chief Legal Officer; Managing Director, Mutual Funds Group, Turner Investment Partners, Inc. (registered investment adviser); Executive Vice President of Turner Funds and Turner Institutional Portfolios (registered investment companies); and President, Turner Investment Distributors, Inc. (registered broker-dealer). | N/A | None | ||||||
Gerald J. Holland Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1951 | Treasurer since March 2001 | Mr. Holland is Senior Vice President—Operations for Nationwide Funds Group3. | N/A | N/A | ||||||
Number of Portfolios | ||||||||||
Position(s) Held | in the | |||||||||
with the Trust | Principal Occupation(s) | Nationwide Fund | Other | |||||||
Name, Address | and Length of | During Past | Complex Overseen | Directorships | ||||||
and Year of Birth | Time Served1 | 5 Years | by Trustee | Held by Trustee 2 | ||||||
Michael A. Krulikowski Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1959 | Chief Compliance Officer from June 2004 to August 20074 | Mr. Krulikowski is Vice President and Chief Compliance Officer of Nationwide Funds Group3, Morley Capital Management, Inc.3, Nationwide SA Capital Trust (since 1999)3, and Nationwide Separate Accounts LLC (since August 2005).3 Since June 2004, Mr. Krulikowski has also served as Chief Compliance Officer of the Trust. From November 1999 through May 2007, he served as Vice President and Chief Compliance Officer of NorthPointe Capital LLC. 3 | N/A | N/A | ||||||
Eric E. Miller Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1953 | Secretary since December 2002 | Mr. Miller is Senior Vice President, General Counsel, and Assistant Secretary for Nationwide Funds Group3 and NWD Investments.2 From August 2000 to August 2002, Mr. Miller was a Partner with Stradley Ronon Stevens & Young, LLP. | N/A | N/A | ||||||
1 | Length of time served includes time served with the Trust’s predecessors. | |
2 | Directorships held in (1) any other investment companies registered under the 1940 Act, (2) any company with a class of securities registered pursuant to Section 12 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or (3) any company subject to the requirements of Section 15(d) of the Exchange Act. | |
3 | This position is held with an affiliated person or principal underwriter of the Trust. | |
4 | Effective August 3, 2007, the Board of Trustees approved Carol Baldwin Moody as Chief Compliance Officer of the Trust. Since November 2005, Ms. Moody has been Senior Vice President, Chief Compliance Officer of Nationwide Financial Services, Nationwide Life Insurance Company, Nationwide Life and Annuity Insurance Company, and Nationwide Investment Advisors, LLC. From February 2004-November 2005, she was Chief Compliance Officer of TIAA-CREF and from April 2000-February 2004, she was Managing Director and General Counsel, TCW/ Latin America Partners, LLC and Baeza & Co., LLC. | |
Federal law requires the Trust, each of its investment advisers and sub-advisers to adopt procedures for voting proxies (“Proxy Voting Guidelines”) and to provide a summary of those Proxy Voting Guidelines used to vote the securities held by the Funds. The Funds’ proxy voting policies and procedures are available without charge (i) upon request, by calling 800-848-0920, (ii) on the Funds’ website at www.nationwidefunds.com, or (iii) on the Securities and Exchange Commission’s website at www.sec.gov. |
A. Renewal of Investment Advisory Agreement
(i) | General Information Regarding the Board’s Review of Investment Advisory Agreements |
The Trust’s investment advisory agreements (each an “Advisory Agreement”) with its investment adviser and, as applicable, sub-advisers (together, the “Adviser”) must be approved for an initial term no greater than two years, and renewed at least annually thereafter, (i) by the vote of the Trustees or by a vote of the shareholders of each series or fund of the Trust (individually a “Fund”), and (ii) by the vote of a majority of the Trustees who are not parties to the Advisory Agreement or “interested persons” of any party thereto (the “Independent Trustees”) cast in person at a meeting called for the purpose of voting on such approval.
The Board meets quarterly and takes into account throughout the year matters bearing on each Fund’s Advisory Agreement. The Board and its standing committees consider at each meeting factors that are relevant to the annual renewal of an Advisory Agreement, including the services and support provided to a Fund and its shareholders.
On December 6, 2006, the Independent Trustees first met in person with their independent legal counsel (“Independent Legal Counsel”) to consider information provided by the Adviser and others to assist the Trustees in considering whether to renew each Fund’s Advisory Agreement for a one year term beginning May 1, 2007. Immediately following such meeting of the Independent Trustees, all Trustees met in person with the Adviser, Trust counsel, Independent Legal Counsel and others to consider such matters, and give preliminary consideration to information bearing on continuation of each Advisory Agreement. The primary purpose of the December 6 and 7, 2006 meeting was to ensure that the Trustees had ample opportunity to consider matters they deemed relevant in considering the continuation of an Advisory Agreement, and to request any additional information they considered reasonably necessary to their deliberations.
In preparation for the December 6 and 7, 2006 meeting the Trustees were provided, at the request of the Trustees, with a wide range of information to assist in their deliberations, including (i) reports from Lipper Inc. describing a Fund’s (a) performance rankings (where “first quintile” denotes the best performance) (over multiple years ended September 30, 2006) compared with performance groups and performance universes created by Lipper (and in some cases, customized peer groups created by the Adviser) of similar or peer group funds, and (b) expense rankings (where “first quintile” denotes the lowest fees and expenses) comparing the Fund’s contractual advisory fee and total expenses with expense groups and expense universes created by Lipper of similar or peer group funds, (ii) information from the Adviser describing the Fund’s performance (over multiple years ended September 30, 2006) compared with its benchmark and Lipper categories, (iii) for Funds under “close review,” copies of letters from the Adviser to the portfolio manager of each such Fund, together with the portfolio manager’s written response describing the reasons for the Fund’s underperformance (iv) information from the Adviser describing performance for the months of October and November, 2006, and annual performance for the year ended November 30, 2006, (v) reports from the Adviser describing the Adviser’s profitability in providing services under an Advisory Agreement, together with an explanation of Adviser’s methodology in calculating its profitability, (vi) information from the Adviser describing any fees paid to the Adviser for managing similar, non-affiliated institutional accounts, including the range of fee levels for such accounts, and (vii) information from the Adviser describing ancillary benefits, in addition to fees for serving as investment adviser, derived by the Adviser as a result of being investment adviser for a Fund, including, where applicable, information on soft-dollar benefits and fees inuring to the Adviser’s affiliates for serving as the Trust’s administrator, fund accountant and transfer agent.
At the December 6 and 7, 2006 meeting, the Trustees reviewed, considered and discussed, among themselves and with the Adviser, Trust counsel and Independent Legal Counsel, among other things, the information described above, and: (i) the nature, extent and quality of services provided by the Adviser under each Advisory Agreement, (ii) the investment performance of each Fund and the Adviser, (iii) the costs of the services provided by the Adviser under the Advisory Agreement and the profits realized by the Adviser thereunder, (iv) the extent to which economies of scale may be present and, if so, whether they are being shared with a Fund’s shareholders, (v) comparisons of the Adviser’s fees under the Advisory Agreement with investment advisory fees paid by peer group funds to their investment advisers and paid by non-affiliated institutional clients to the Adviser for managing similar accounts, and (vi) any ancillary benefits inuring to the Adviser and its affiliates as a result of being investment adviser for the Trust. The Trustees also considered, where
As part of the December 6 and 7, 2006 Board meeting, the Independent Trustees developed a list of follow-up matters and questions and asked that Adviser respond to such matters and questions at the contract approval meeting of the Board of Trustees to be held on January 11, 2007.
At the January 11, 2007 meeting of the Board of Trustees of the Trust, the Board received and considered information provided by the Adviser in follow-up from the December 6 and 7, 2006 Board meeting and, after consulting among themselves, and with the Adviser, Trust counsel and Independent Legal Counsel, concluded unanimously to renew the Advisory Agreement for the reasons set forth in the following section. In determining whether to renew the Advisory Agreement for the Fund, the Board ultimately reached a determination, with the assistance of Trust counsel and Independent Legal Counsel, that the renewal of the Advisory Agreement and the compensation to be received by the Adviser under the Advisory Agreement is consistent with the Board’s fiduciary duty under applicable law.
(ii) | Board Conclusions Regarding the Fund’s Advisory Agreement |
The Board considered that the Fund had outperformed its secondary benchmark (which is a more appropriate indicator of performance than the Fund’s primary benchmark) for the one- and three-year periods. The Board also considered that the performance of the Fund’s Class II had ranked in the first quintile of its Lipper-constructed Performance Group over the one- and two-year periods. The Board also considered that the Fund’s portfolio manager had changed during 2006 and considered the services provided by the adviser to the Fund that are in addition to the advisory services that are provided to the underlying funds. Based on its review, and giving particular weight to the nature and quality of the resources dedicated by the adviser to maintain relative performance, the Board concluded that the nature, extent, and quality of the services provided to the Fund will benefit the Fund’s shareholders.
The Board also considered that the Fund’s contractual advisory fee and breakpoints placed the Fund in the fourth quintile of its Lipper-constructed Expense Group and the Fund’s total expenses placed the Fund in the first quintile. The Board considered that total expenses were relatively low, and the advisory fee should be consistent among all of the Investor Destination Funds offered by the Trust. The Board concluded that the Fund’s management fee and total expenses were fair and reasonable in light of the services that the Fund receives and the other factors considered.
The Board considered that the Fund’s adviser reported a pre-tax profit margin for investment management services during each of the twelve month-periods ended September 30, 2006 and 2005. The Board considered the costs of the services provided by and the profits realized by the adviser in connection with the operation of the Fund and determined that the amount of profit is a fair entrepreneurial profit for the management of the Fund.
Based upon its evaluation of all of the conclusions noted above, and after considering all material factors with respect to the Fund, the Board ultimately concluded that the advisory fee structure is fair and reasonable, and that the Advisory Agreement (and, if applicable, Sub-Advisory Agreement) with respect to the Fund, should be renewed.
B. Approval of New Advisory Agreement
At its January 11, 2007 meeting, the Board also unanimously approved a new investment advisory agreement (the “New Agreement”) for the Fund with Nationwide Fund Advisors, (“NFA”) the then-current adviser to each of the series of the Trust to become effective upon the closing of the acquisition of NFA by Nationwide Financial Services, Inc. (“NFS”) from Nationwide Corporation (“NWC”) which closed on April 30, 2007 (the “Transaction”). In approving the New Agreement, the Board considered NFA’s capacity to continue to provide the services needed to operate a sophisticated investment management business and to support the management of each of the series. The Board also took into account the information provided to them at their regular quarterly meetings with NFA’s senior management with respect to the Fund, including the information provided by management at the Fund’s annual Section 15(c) meetings on
C. Submission of Matters to a Vote of Security Holders:
On April 25, 2007, a Special Meeting of Shareholders was held* (the “April 25 Meeting”) at which shareholders of the Funds** set forth below were asked:
Proposal 1:
To approve a new investment advisory agreement, on behalf of their Fund, between Nationwide Fund Advisors (formerly “Gartmore Mutual Fund Capital Trust”) (the “Adviser”) and Nationwide Variable Insurance Trust (formerly “Gartmore Variable Insurance Trust”) (the “Trust”).
Number of Shares | ||||
Fund | Cast/Not Cast | Percentages | ||
Federated NVIT High Income Bond Fund (Formerly Federated GVIT High Income Bond Fund) | FOR 30,051,703.188 shares AGAINST 618,245.021 shares ABSTAIN 1,813,550.431 shares TOTAL 32,483,498.640 shares | 92.514% 1.903% 5.583% | ||
NVIT International Index Fund (Formerly GVIT International Index Fund) | FOR 4,322,203.982 shares AGAINST 2,758.318 shares ABSTAIN 135,636.840 shares TOTAL 4,460,599.140 shares | 96.897% 0.062% 3.041% | ||
NVIT International Value Fund (Formerly GVIT International Value Fund) | FOR 20,032,843.199 shares AGAINST 333,588.902 shares ABSTAIN 1,093,293.879 shares TOTAL 21,459,725.980 shares | 93.351% 1.554% 5.095% | ||
NVIT Mid Cap Index Fund (Formerly GVIT Mid Cap Index Fund) | FOR 35,380,179.120 shares AGAINST 631,117.844 shares ABSTAIN 1,565,714.306 shares TOTAL 37,577,011.270 shares | 94.154% 1.679% 4.167% | ||
NVIT S&P 500 Index Fund (Formerly GVIT S&P 500 Index Fund) | FOR 56,119,814.230 shares AGAINST 666,195.542 shares ABSTAIN 1,944,898.888 shares TOTAL 58,730,908.660 shares | 95.554% 1.134% 3.312% |
Number of Shares | ||||
Fund | Cast/Not Cast | Percentages | ||
Nationwide Multi-Manager NVIT Small Cap Growth Fund (Formerly GVIT Small Cap Growth Fund) | FOR 7,632,918.513 shares AGAINST 149,458.111 shares ABSTAIN 451,583.036 shares TOTAL 8,233,959.660 shares | 92.700% 1.816% 5.484% | ||
Nationwide Multi-Manager NVIT Small Cap Value Fund (Formerly GVIT Small Cap Value Fund) | FOR 48,649,396.525 shares AGAINST 979,183.753 shares ABSTAIN 2,786,133.102 shares TOTAL 52,414,713.380 shares | 92.816% 1.868% 5.316% | ||
Nationwide Multi-Manager NVIT Small Company Fund (Formerly GVIT Small Company Fund) | FOR 29,903,181.700 shares AGAINST 838,774.923 shares ABSTAIN 2,006,741.307 shares TOTAL 32,748,697.930 shares | 91.311% 2.561% 6.128% | ||
Gartmore NVIT Developing Markets Fund (Formerly Gartmore GVIT Developing Markets Fund) | FOR 21,0177,889.443 shares AGAINST 424,272.958 shares ABSTAIN 1,543,850.729 shares TOTAL 23,046,013.130 shares | 91.460% 1.841% 6.699% | ||
Gartmore NVIT Emerging Markets Fund (Formerly Gartmore GVIT Emerging Markets Fund) | FOR 17,050,534.593 shares AGAINST 526,574.722 shares ABSTAIN 881,608.905 shares TOTAL 18,458,718.220 shares | 92.371% 2.853% 4.776% | ||
Nationwide NVIT Global Financial Services Fund (Formerly Gartmore GVIT Global Financial Services Fund) | FOR 1,554,847.333 shares AGAINST 19,539.033 shares ABSTAIN 52,206.494 shares TOTAL 1,626,592.860 shares | 95.589% 1.201% 3.210% | ||
Nationwide NVIT Global Health Sciences Fund (Formerly Gartmore GVIT Global Health Sciences Fund) | FOR 4,722,963.678 shares AGAINST 157,979.030 shares ABSTAIN 207,642.222 shares TOTAL 5,088,584.930 shares | 92.815% 3.104% 4.081% | ||
Nationwide NVIT Global Technology and Communications Fund (Formerly Gartmore GVIT Global Technology and Communications Fund) | FOR 8,585,472.039 shares AGAINST 102,267.977 shares ABSTAIN 489,577.634 shares TOTAL 9,177,317.650 shares | 93.551% 1.114% 5.335% | ||
Gartmore NVIT Global Utilities Fund (Formerly Gartmore GVIT Global Utilities Fund) | FOR 4,123,270.549 shares AGAINST 122,001.533 shares ABSTAIN 240,276.088 shares TOTAL 4,485,548.170 shares | 91.923% 2.720% 5.357% | ||
Nationwide NVIT Government Bond Fund (Formerly Gartmore GVIT Government Bond Fund) | FOR 88,471,567.462 shares AGAINST 1,825,645.181 shares ABSTAIN 5,841,990.727 shares TOTAL 96,139,203.370 shares | 92.024% 1.899% 6.077% |
Number of Shares | ||||
Fund | Cast/Not Cast | Percentages | ||
Nationwide NVIT Growth Fund (Formerly Gartmore GVIT Growth Fund) | FOR 14,931,435.904 shares AGAINST 409,826.402 shares ABSTAIN 1,259,945.064 shares TOTAL 16,601,207.370 shares | 89.942% 2.469% 7.589% | ||
Gartmore NVIT International Growth Fund (Formerly Gartmore GVIT International Growth Fund) | FOR 6,251,419.070 shares AGAINST 139,618.548 shares ABSTAIN 290,025.592 shares TOTAL 6,681,063.210 shares | 93.569% 2.090% 4.341% | ||
Nationwide NVIT Investor Destinations Aggressive Fund (Formerly Gartmore GVIT Investor Destinations Aggressive Fund) | FOR 49,489,224.549 shares AGAINST 1,385,396.474 shares ABSTAIN 3,696,272.337 shares TOTAL 54,570,893.360 shares | 90.688% 2.539% 6.773% | ||
Nationwide NVIT Investor Destinations Conservative Fund (Formerly Gartmore GVIT Investor Destinations Conservative Fund) | FOR 23,091,965.887 shares AGAINST 314,935,884 shares ABSTAIN 2,292,355.179 shares TOTAL 25,699,256.950 shares | 89.855% 1.225% 8.920% | ||
Nationwide NVIT Investor Destinations Moderate Fund (Formerly Gartmore GVIT Investor Destinations Moderate Fund) | FOR 188,902,093.059 shares AGAINST 3,018,924.590 shares ABSTAIN 16,359,690.401 shares TOTAL 208,280,708.050 shares | 90.696% 1.449% 7.855% | ||
Nationwide NVIT Investor Destinations Moderately Aggressive Fund (Formerly Gartmore GVIT Investor Destinations Moderately Aggressive Fund) | FOR 134,792,622.920 shares AGAINST 3,489,207.264 shares ABSTAIN 9,304,197.656 shares TOTAL 147,586,027.840 shares | 91.332% 2.364% 6.304% | ||
Nationwide NVIT Investor Destinations Moderately Conservative Fund (Formerly Gartmore GVIT Investor Destinations Moderately Conservative Fund) | FOR 49,627,123.216 shares AGAINST 856,088.634 shares ABSTAIN 3,507,215.650 shares TOTAL 53,990,427.500 shares | 91.918% 1.586% 6.496% | ||
Nationwide NVIT Mid Cap Growth Fund (Formerly Gartmore GVIT Mid Cap Growth Fund) | FOR 10,879,584.971 shares AGAINST 352,594.958 shares ABSTAIN 717,792.971 shares TOTAL 11,949,972.900 shares | 91.043% 2.950% 6.007% | ||
Nationwide NVIT Money Market Fund II (Formerly Gartmore GVIT Money Market Fund II) | FOR 221,774,863.241 shares AGAINST 12,322,482.494 shares ABSTAIN 16,471,740.875 shares TOTAL 250,569,086.610 shares | 88.508% 4.918% 6.574% |
Number of Shares | ||||
Fund | Cast/Not Cast | Percentages | ||
Nationwide NVIT Money Market Fund (Formerly Gartmore GVIT Money Market Fund) | FOR 1,578,331,008.328 shares AGAINST 32,372,133.671 shares ABSTAIN 112,652,123.301 shares TOTAL 1,723,355,265.300 shares | 91.585% 1.878% 6.537% | ||
NVIT Nationwide Fund (Formerly Gartmore GVIT Nationwide Fund) | FOR 125,423,274.735 shares AGAINST 2,767,979.467 shares ABSTAIN 8,762,255.828 shares TOTAL 136,953,510.030 shares | 91.581% 2.021% 6.398% | ||
NVIT Nationwide Leaders Fund (Formerly Gartmore GVIT Nationwide Leaders Fund) | FOR 2,298,504.956 shares AGAINST 29,630.469 shares ABSTAIN 71,637.755 shares TOTAL 2,399,773.180 shares | 95.780% 1.235% 2.985% | ||
Nationwide NVIT U.S. Growth Leaders Fund (Formerly Gartmore GVIT U.S. Growth Leaders Fund) | FOR 4,972,094.773 shares AGAINST 122,623.161 shares ABSTAIN 174,625.606 shares TOTAL 5,269,343.540 shares | 94.359% 2.327% 3.314% | ||
Gartmore NVIT Worldwide Leaders Fund (Formerly Gartmore GVIT Worldwide Leaders Fund) | FOR 2,666,862.487 shares AGAINST 47,702.491 shares ABSTAIN 118,719.882 shares TOTAL 2,833,284.860 shares | 94.126% 1.684% 4.190% | ||
J.P. Morgan NVIT Balanced Fund (Formerly J.P. Morgan GVIT Balanced Fund) | FOR 15,966,867.546 shares AGAINST 259,004.324 shares ABSTAIN 1,339,385.200 shares TOTAL 17,565,257.070 shares | 90.900% 1.475% 7.625% | ||
Van Kampen NVIT Comstock Value Fund (Formerly Van Kampen GVIT Comstock Value Fund) | FOR 27,737,008.009 shares AGAINST 502,564.164 shares ABSTAIN 1,824,670.107 shares TOTAL 30,064,242.280 shares | 92.259% 1.672% 6.069% | ||
Van Kampen NVIT Multi Sector Bond Fund (Formerly Van Kampen GVIT Multi Sector Bond Fund) | FOR 21,253,297.665 shares AGAINST 484,100.920 shares ABSTAIN 1,803,963.645 shares TOTAL 23,541,362.230 shares | 90.281% 2.056% 7.663% | ||
At the April 25 Meeting, shareholders of the Nationwide NVIT Mid Cap Growth Fund were also asked to approve a new investment subadvisory agreement among the Adviser, the Trust and NorthPointe Capital LLC. The voting results with respect to that proposal are set forth below:
Proposal 2
Number of Shares | ||||
Fund | Cast/Not Cast | Percentages | ||
Nationwide NVIT Mid Cap Growth Fund (Formerly Gartmore GVIT Mid Cap Growth Fund) | FOR 10,862,827.499 shares AGAINST 414,574.660 shares ABSTAIN 672,570.741 shares TOTAL 11,949,972.900 shares | 90.903% 3.469% 5.628% | ||
* | This meeting was previously adjourned on April 23, 2007. | |
** | Fund names were changed effective May 1, 2007 to reflect “Nationwide”/ “NVIT” branding to coincide with the sale of Nationwide Fund Advisors, Inc. by Nationwide Corporation to its majority-owned subsidiary, Nationwide Financial Services, Inc. |
June 30, 2007 (Unaudited)
Contents | ||
6 | Statement of Investments | |
7 | Statement of Assets and Liabilities | |
8 | Statement of Operations | |
9 | Statements of Changes in Net Assets | |
11 | Financial Highlights | |
12 | Notes to Financial Statements |
Statement Regarding Availability of Proxy Voting Record.
SAR-IDM (8/07) | ![]() |
Dear Fellow Shareholder:
Since I last wrote to you, our mutual funds have enjoyed another period of solid performance, and the corporate realignment that was in progress is now finished.
On May 1, 2007, Nationwide Financial Services, Inc. (NFS), completed its acquisition of the Philadelphia-based retail mutual fund operations of NWD Investment Management, Inc. (formerly, “Gartmore Global Investments, Inc.”), from Nationwide Corporation, a subsidiary of Nationwide Mutual Insurance Company. Effective that date, the acquired entities were renamed Nationwide Funds Group (NFG), and the Gartmore Funds were renamed the Nationwide Funds to better align with the Nationwide® brand. Although the corporate ownership and fund names have changed, I can assure you that NFG intends to maintain as much continuity as possible with the Funds and key personnel.
Thank you, shareholders, for approving the new investment advisory agreement that was required due to the change in corporate ownership. The new agreement is identical in all material respects to the original agreement that it replaces, with the exception of the section pertaining to the vote by the shareholders of the NVIT Mid Cap Growth Fund to approve NorthPointe Capital®, LLC (NorthPointe) as sub-adviser to that particular Fund.
Market Overview: January 1-June 30, 2007
Share prices in general were buoyed in part by better-than-expected first-quarter 2007 earnings and a flurry of mergers and acquisitions, many of these spurred by readily available funding from private equity firms. In June, investors grew more cautious amid surging crude oil prices, a sudden spike in long-term interest rates, and the meltdown of two hedge funds that had exposure to the subprime mortgage market. Looking abroad, a weak U.S. dollar aided foreign stocks, as reflected in the 11.09% advance of the Morgan Stanley Capital International Europe, Australasia and Far East (MSCI EAFE®) Index. Emerging market performance was particularly robust.
The bond market struggled during the first half of 2007. While short-term interest rates remained stable, reflecting the Federal Reserve Board’s decision in June to leave the target federal funds rate at 5.25%, longer-term rates climbed during the first half of 2007, depressing bond prices and forcing the Lehman Brothers® U.S. Aggregate Index to settle for a modest 0.97% return.
We at NFG thank you for your understanding and cooperation throughout our recent transition period. We emerge from this period energized for the future, and we look forward to serving your investment needs for a long time to come.
Nationwide Funds Group
PAST PERFORMANCE IS NO GUARANTEE OF FUTURE RESULTS.
Nationwide Funds are advised by Nationwide Fund Advisors (NFA). NFA is a wholly-owned subsidiary of Nationwide Financial Services. Nationwide Financial Services is a wholly-owned subsidiary of Nationwide Corporation. All of the common stock of Nationwide Corporation is held by Nationwide Mutual (95.2%) and Nationwide Mutual Fire Insurance Company (4.8%), each of which is a mutual company owned by its policyholders.
Nationwide Funds Group (NFG) is the mutual fund arm of Nationwide Financial Services (NYSE: NFS). Based in Conshohocken, Pa., a suburb of Philadelphia, NFG is comprised of Nationwide Fund Advisors, Nationwide Fund Distributors, LLC, and Nationwide Fund Management, LLC. Together, these provide advisory, distribution, and administration services respectively to the Nationwide Funds, and manage more than $43.5 billion in assets as of June 30, 2007, of which more than $12 billion are in “fund of funds” designed to provide asset allocation across several types of investments and asset classes.
Lehman Brothers (LB) U.S. Aggregate Index: An unmanaged, market value-weighted index of investment-grade, fixed-rate debt issues (including government, corporate, asset-backed, and mortgage-backed securities with maturities of one year or more) that is generally representative of the bond market as a whole.
Morgan Stanley Capital International Europe, Australasia and Far East (MSCI EAFE®) Index: An unmanaged, free float-adjusted, market capitalization-weighted index that is designed to measure the performance of stocks in developed markets outside the United States and Canada.
Standard & Poor’s 500® (S&P 500) Index: An unmanaged, market capitalization-weighted index of 500 widely held stocks of large-cap U.S. companies that gives a broad look at how the stock prices of those companies have performed.
Views expressed within are those of Nationwide Funds Group as of the date noted, are subject to change at any time, and may not come to pass.
This report is for informational purposes only, and is not intended as an offer or recommendation with respect to the purchase or sale of any security, option, future, or other derivatives in such securities.
Investing in mutual funds involves risk, including possible loss of principal.
Investors should carefully consider a fund’s investment objectives, risks, fees, charges, and expenses before investing any money. To obtain this and other fund information, please call 800-848-0920 to request a prospectus, or download a prospectus at www.nationwidefunds.com. Please read the prospectus carefully before investing any money.
Nationwide Funds distributed by Nationwide Fund Distributors LLC (formerly Gartmore Distribution Services, Inc.), Member NASD. 1200 River Road, Suite 1000, Conshohocken, Pa. 19428.
Shareholder Expense Example | Nationwide NVIT Investor Destinations Moderate Fund |
As a shareholder of the Fund, you incur two types of costs: (1) transaction costs, including sales charges (loads) paid on purchase payments and redemption fees; and (2) ongoing costs, including investment advisory fees, administration fees, distribution fees and other Fund expenses. The examples below are 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. Per SEC requirements, the examples assume that you had a $1,000 investment in the Class at the beginning of the reporting period, January 1, 2007, and continued to hold your shares at the end of the reporting period, June 30, 2007.
Actual Expenses
Hypothetical Example for Comparison Purposes
Please note that the expenses shown in the table are meant to highlight your ongoing costs only and do not reflect any transaction costs, such as sales charges (loads) or redemption fees. Therefore, the second line for each Class in 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 transaction costs were included, your costs would have been higher. The examples also assume all dividends and distributions have been reinvested.
Schedule of Shareholder Expenses
Ending | |||||||||||||||||||||||
Beginning | Account | Expenses Paid | Annualized | ||||||||||||||||||||
Nationwide NVIT Investor Destinations | Account Value, | Value, | During | Expense | |||||||||||||||||||
Moderate Fund | January 1, 2007 | June 30, 2007 | Period*2 | Ratio*2 | |||||||||||||||||||
Class II | Actual | $ | 1,000.00 | $ | 1,054.40 | $ | 2.70 | 0.53% | |||||||||||||||
Hypothetical | 1 | $ | 1,000.00 | $ | 1,022.17 | $ | 2.66 | 0.53% | |||||||||||||||
Class VI | Actual | $ | 1,000.00 | $ | 1,053.50 | $ | 2.85 | 0.56% | |||||||||||||||
Hypothetical | 1 | $ | 1,000.00 | $ | 1,022.02 | $ | 2.81 | 0.56% | |||||||||||||||
* | Expenses are equal to the Fund’s annualized expense ratio multiplied by the average account value over the period multiplied by 181/365 (to reflect the one-half year period). The expense ratio presented represents a six-month, annualized ratio in accordance with SEC guidelines. The expenses reported above do not include the effect of additional expenses imposed by variable annuity contracts. | |
1 | Represents the hypothetical 5% return before expenses. | |
2 | Expenses are based on the direct expenses of the Fund and do not include the effect of the underlying Funds’ expenses, which are disclosed in the Fee and Expense table and described more fully in a footnote to that table in your Fund prospectus. |
Portfolio Summary | Nationwide NVIT Investor Destinations Moderate Fund |
Asset Allocation | ||||
Mutual Funds | 88.2% | |||
Fixed Contract | 11.8% | |||
100.0% |
Asset Allocation Detail | ||||
Equity Funds | 59.9% | |||
Fixed Income Funds | 28.3% | |||
Fixed Contract | 11.8% | |||
100.0% |
Top Holdings | ||||
NVIT S&P 500 Index Fund, ID Class | 29.9% | |||
Nationwide NVIT Bond Index Fund, ID Class | 25.1% | |||
Nationwide International Index Fund, Institutional Class | 14.7% | |||
Nationwide Fixed Contract, 3.95% | 11.8% | |||
NVIT Mid Cap Index Fund, ID Class | 10.0% | |||
NVIT Small Cap Index Fund, ID Class | 5.0% | |||
Nationwide NVIT Enhanced Income Fund, ID Class | 3.2% | |||
NVIT International Index Fund, ID Class | 0.3% | |||
100.0% |
Nationwide NVIT Investor Destinations Moderate Fund
Mutual Funds (88.2%)(a) | ||||||||
Shares or | ||||||||
Principal Amount | Value | |||||||
Equity Funds (59.9%) | ||||||||
NVIT Small Cap Index Fund, ID Class | 14,048,999 | $ | 142,597,342 | |||||
Nationwide International Index Fund, Institutional Class | 35,682,134 | 423,903,758 | ||||||
NVIT International Index Fund, ID Class | 821,543 | 9,694,204 | ||||||
NVIT Mid Cap Index Fund, ID Class | 14,279,769 | 286,166,575 | ||||||
NVIT S&P 500 Index Fund, ID Class | 82,044,013 | 859,000,811 | ||||||
Fixed Income Funds (28.3%) | ||||||||
Nationwide NVIT Bond Index Fund, ID Class | 73,258,571 | 720,131,752 | ||||||
Nationwide NVIT Enhanced Income Fund, ID Class | 9,246,405 | 92,464,052 | ||||||
Total Mutual Funds (Cost $2,374,024,072) | 2,533,958,494 | |||||||
Fixed Contract (11.8%)(a) (b) | ||||||||
Shares or | ||||||||
Principal Amount | Value | |||||||
Nationwide Fixed Contract, 3.95% | $ | 337,893,311 | $ | 337,893,311 | ||||
Total Investments (Cost $2,711,917,384) (c) — 100.0% | 2,871,851,805 | |||||||
Liabilities in excess of other assets — 0.0% | (76,196 | ) | ||||||
NET ASSETS — 100.0% | $ | 2,871,775,609 | ||||||
(a) | Investment in affiliate. | |
(b) | The Nationwide Fixed Contract rate changes quarterly. The security is restricted and as the affiliated counterparty is required by contract to redeem within five days upon request, it has been deemed liquid pursuant to procedures approved by the Board of Trustees. | |
(c) | See notes to financial statements for tax unrealized appreciation (depreciation) of securities. |
See accompanying notes to financial statements.
Nationwide NVIT | ||||||
Investor | ||||||
Destinations | ||||||
Moderate Fund | ||||||
Assets: | ||||||
Investments in affiliates, at value (cost $2,711,917,384) | $ | 2,871,851,805 | ||||
Cash | 60 | |||||
Interest and dividends receivable | 73,133 | |||||
Receivable for capital shares issued | 1,076,734 | |||||
Prepaid expenses | 29,407 | |||||
Total Assets | 2,873,031,139 | |||||
Liabilities: | ||||||
Payable for capital shares redeemed | 190,149 | |||||
Accrued expenses and other payables: | ||||||
Investment advisory fees | 305,831 | |||||
Distribution fees | 588,143 | |||||
Administrative servicing fees | 36,364 | |||||
Compliance program costs | 32,230 | |||||
Other | 102,813 | |||||
Total Liabilities | 1,255,530 | |||||
Net Assets | $ | 2,871,775,609 | ||||
Represented by: | ||||||
Capital | $ | 2,512,750,654 | ||||
Accumulated net investment loss | (1,831,852 | ) | ||||
Accumulated net realized gains from investment transactions | 200,922,386 | |||||
Net unrealized appreciation on investments | 159,934,421 | |||||
Net Assets | $ | 2,871,775,609 | ||||
Net Assets: | ||||||
Class II Shares | $ | 2,848,400,698 | ||||
Class VI Shares | 23,374,911 | |||||
Total | $ | 2,871,775,609 | ||||
Shares outstanding (unlimited number of shares authorized): | ||||||
Class II Shares | 226,497,597 | |||||
Class VI Shares | 1,865,144 | |||||
Total | 228,362,741 | |||||
Net asset value and offering price per share (Net assets by class divided by shares outstanding by class, respectively.):* | ||||||
Class II Shares | $ | 12.58 | ||||
Class VI Shares | $ | 12.53 | ||||
* | Not subject to a front-end sales charge. |
7
Nationwide NVIT | |||||
Investor Destinations | |||||
Moderate Fund | |||||
INVESTMENT INCOME: | |||||
Interest income | $ | 6,375,286 | |||
Dividend income from affiliates | 33,047,396 | ||||
Total Income | 39,422,682 | ||||
Expenses: | |||||
Investment advisory fees | 1,746,229 | ||||
Distribution fees Class II Shares | 3,329,678 | ||||
Distribution fees Class VI Shares | 28,488 | ||||
Administrative servicing fees Class II Shares | 1,684,918 | ||||
Administrative servicing fees Class VI Shares | 17,634 | ||||
Trustee fees | 60,320 | ||||
Compliance program costs (Note 3) | 17,996 | ||||
Other | 235,430 | ||||
Total expenses before earnings credit | 7,120,693 | ||||
Earnings credit (Note 6) | (101 | ) | |||
Net Expenses | 7,120,592 | ||||
Net Investment Income | 32,302,090 | ||||
REALIZED/ UNREALIZED GAINS (LOSSES) FROM INVESTMENTS: | |||||
Realized gains on investment transactions with affiliates | 185,702,785 | ||||
Realized gain distributions from underlying funds | 17,689,112 | ||||
Net realized gains on investment transactions | 203,391,897 | ||||
Net change in unrealized depreciation on investments | (94,618,444 | ) | |||
Net realized/unrealized gains (losses) on investments | 108,773,453 | ||||
CHANGE IN NET ASSETS RESULTING FROM OPERATIONS | $ | 141,075,543 | |||
8
Nationwide NVIT Investor | |||||||||
Destinations Moderate Fund | |||||||||
Six Months Ended | Year Ended | ||||||||
June 30, 2007 | December 31, 2006 | ||||||||
(Unaudited) | |||||||||
FROM INVESTMENT ACTIVITIES: | |||||||||
Operations: | |||||||||
Net investment income | $ | 32,302,090 | $ | 47,432,705 | |||||
Net realized gains on investment transactions | 203,391,897 | 50,919,554 | |||||||
Net change in unrealized appreciation/depreciation on investment transactions | (94,618,444 | ) | 129,388,515 | ||||||
Change in net assets resulting from operations | 141,075,543 | 227,740,774 | |||||||
Distributions to shareholders from: | |||||||||
Net investment income: | |||||||||
Class II | (36,344,928 | ) | (51,810,785 | ) | |||||
Class VI | (324,492 | ) | (477,558 | ) | |||||
Net realized gains on investments: | |||||||||
Class II | (43,372,304 | ) | (18,140,929 | ) | |||||
Class VI | (357,115 | ) | (162,221 | ) | |||||
Change in net assets from shareholder distributions | (80,398,839 | ) | (70,591,493 | ) | |||||
Change in net assets from capital transactions | 286,703,293 | 755,371,878 | |||||||
Change in net assets | 347,379,997 | 912,521,159 | |||||||
Net Assets: | |||||||||
Beginning of period | 2,524,395,612 | 1,611,874,453 | |||||||
End of period | $ | 2,871,775,609 | $ | 2,524,395,612 | |||||
Accumulated net investment income (loss) at end of period | $ | (1,831,852 | ) | $ | 2,535,478 | ||||
CAPITAL TRANSACTIONS: | |||||||||
Class II Shares | |||||||||
Proceeds from shares issued | $ | 264,214,938 | $ | 760,256,687 | |||||
Dividends reinvested | 79,717,041 | 69,951,702 | |||||||
Cost of shares redeemed (a) | (59,023,871 | ) | (78,686,222 | ) | |||||
284,908,108 | 751,522,167 | ||||||||
Class VI Shares | |||||||||
Proceeds from shares issued | 4,526,692 | 8,528,933 | |||||||
Dividends reinvested | 681,605 | 639,779 | |||||||
Cost of shares redeemed (a) | (3,413,112 | ) | (5,319,001 | ) | |||||
1,795,185 | 3,849,711 | ||||||||
Change in net assets from capital transactions | $ | 286,703,293 | $ | 755,371,878 | |||||
SHARE TRANSACTIONS: | |||||||||
Class II Shares | |||||||||
Issued | 21,001,020 | 64,533,522 | |||||||
Reinvested | 6,365,190 | 5,957,371 | |||||||
Redeemed | (4,693,425 | ) | (6,664,139 | ) | |||||
22,672,785 | 63,826,754 | ||||||||
9
Nationwide NVIT Investor | |||||||||
Destinations Moderate Fund | |||||||||
Six Months Ended | Year Ended | ||||||||
June 30, 2007 | December 31, 2006 | ||||||||
(Unaudited) | |||||||||
SHARE TRANSACTIONS: (continued) | |||||||||
Class VI Shares | |||||||||
Issued | 363,209 | 722,303 | |||||||
Reinvested | 54,604 | 54,630 | |||||||
Redeemed | (270,342 | ) | (449,155 | ) | |||||
147,471 | 327,778 | ||||||||
Total change in shares | 22,820,256 | 64,154,532 | |||||||
(a) | Includes redemption fees, if any. |
10
Distributions | ||||||||||||||||||||
Investment Activities | ||||||||||||||||||||
Net Realized | ||||||||||||||||||||
and | ||||||||||||||||||||
Net Asset | Unrealized | Total | ||||||||||||||||||
Value, | Net | Gains | from | Net | ||||||||||||||||
Beginning | Investment | (Losses) on | Investment | Investment | ||||||||||||||||
of Period | Income | Investments | Activities | Income | ||||||||||||||||
Class II Shares | ||||||||||||||||||||
For the year ended December 31, 2002 | $ | 10.06 | 0.15 | (1.11 | ) | (0.96 | ) | (0.15 | ) | |||||||||||
For the year ended December 31, 2003 | $ | 8.94 | 0.17 | 1.60 | 1.77 | (0.17 | ) | |||||||||||||
For the year ended December 31, 2004 (e) | $ | 10.54 | 0.21 | 0.78 | 0.99 | (0.21 | ) | |||||||||||||
For the year ended December 31, 2005 | $ | 11.26 | 0.26 | 0.33 | 0.59 | (0.26 | ) | |||||||||||||
For the year ended December 31, 2006 | $ | 11.40 | 0.26 | 1.01 | 1.27 | (0.28 | ) | |||||||||||||
For the six months ended June 30, 2007 (Unaudited) | $ | 12.28 | 0.15 | 0.52 | 0.67 | (0.17 | ) | |||||||||||||
Class VI Shares | ||||||||||||||||||||
Period ended December 31, 2004 (g) | $ | 10.54 | 0.19 | 0.72 | 0.91 | (0.19 | ) | |||||||||||||
For the year ended December 31, 2005 | $ | 11.24 | 0.27 | 0.33 | 0.60 | (0.27 | ) | |||||||||||||
For the year ended December 31, 2006 | $ | 11.38 | 0.26 | 1.02 | 1.28 | (0.30 | ) | |||||||||||||
For the six months ended June 30, 2007 (Unaudited) | $ | 12.25 | 0.15 | 0.51 | 0.66 | (0.18 | ) | |||||||||||||
[Additional columns below]
[Continued from above table, first column(s) repeated]
Distributions | ||||||||||||||||||||||||
Net Assets | Ratio of | |||||||||||||||||||||||
Net | Net Asset | at End of | Expenses | |||||||||||||||||||||
realized | Total | Value, End | Total | Period | to Average | |||||||||||||||||||
gains | Distributions | of Period | Return (a) | (000s) | Net Assets (b) | |||||||||||||||||||
Class II Shares | ||||||||||||||||||||||||
For the year ended December 31, 2002 | (0.01 | ) | (0.16 | ) | $ | 8.94 | (9.60% | ) | $ | 165,555 | 0.56% | |||||||||||||
For the year ended December 31, 2003 | – | (0.17 | ) | $ | 10.54 | 20.05% | $ | 566,916 | 0.56% | |||||||||||||||
For the year ended December 31, 2004 (e) | (0.06 | ) | (0.27 | ) | $ | 11.26 | 9.54% | $ | 1,118,116 | 0.56% | ||||||||||||||
For the year ended December 31, 2005 | (0.19 | ) | (0.45 | ) | $ | 11.40 | 5.34% | $ | 1,596,055 | 0.56% | ||||||||||||||
For the year ended December 31, 2006 | (0.11 | ) | (0.39 | ) | $ | 12.28 | 11.35% | $ | 2,503,358 | 0.57% | ||||||||||||||
For the six months ended June 30, 2007 (Unaudited) | (0.20 | ) | (0.37 | ) | $ | 12.58 | 5.44% | $ | 2,848,401 | 0.53% | ||||||||||||||
Class VI Shares | ||||||||||||||||||||||||
Period ended December 31, 2004 (g) | (0.02 | ) | (0.21 | ) | $ | 11.24 | 8.72% | $ | 9,384 | 0.41% | ||||||||||||||
For the year ended December 31, 2005 | (0.19 | ) | (0.46 | ) | $ | 11.38 | 5.50% | $ | 15,820 | 0.47% | ||||||||||||||
For the year ended December 31, 2006 | (0.11 | ) | (0.41 | ) | $ | 12.25 | 11.44% | $ | 21,038 | 0.56% | ||||||||||||||
For the six months ended June 30, 2007 (Unaudited) | (0.20 | ) | (0.38 | ) | $ | 12.53 | 5.35% | $ | 23,375 | 0.56% | ||||||||||||||
[Additional columns below]
[Continued from above table, first column(s) repeated]
Ratios/Supplemental Data | ||||||||||||||||||
Ratio of Net | ||||||||||||||||||
Ratio of | Investment | |||||||||||||||||
Ratio of Net | Expenses | Income | ||||||||||||||||
Investment | (Prior to | (Prior to | ||||||||||||||||
Income | Reimbursements) | Reimbursements) | ||||||||||||||||
to Average | to Average | to Average | Portfolio | |||||||||||||||
Net Assets (b) | Net Assets (b)(c) | Net Assets (b)(c) | Turnover (d) | |||||||||||||||
Class II Shares | ||||||||||||||||||
For the year ended December 31, 2002 | 2.41% | (f) | (f) | 21.58% | ||||||||||||||
For the year ended December 31, 2003 | 2.01% | (f) | (f) | 9.90% | ||||||||||||||
For the year ended December 31, 2004 (e) | 2.19% | (f) | (f) | 5.54% | ||||||||||||||
For the year ended December 31, 2005 | 2.41% | (f) | (f) | 4.20% | ||||||||||||||
For the year ended December 31, 2006 | 2.32% | (f) | (f) | 5.69% | ||||||||||||||
For the six months ended June 30, 2007 (Unaudited) | 2.36% | 0.53% | 2.36% | 75.09% | ||||||||||||||
Class VI Shares | ||||||||||||||||||
Period ended December 31, 2004 (g) | 3.84% | (f) | (f) | 5.54% | ||||||||||||||
For the year ended December 31, 2005 | 2.56% | (f) | (f) | 4.20% | ||||||||||||||
For the year ended December 31, 2006 | 2.30% | (f) | (f) | 5.69% | ||||||||||||||
For the six months ended June 30, 2007 (Unaudited) | 2.32% | 0.56% | 2.32% | 75.09% | ||||||||||||||
(a) | Not annualized for periods less than one year. | |
(b) | Annualized for periods less than one year. | |
(c) | During the period, certain fees were waived and/or reimbursed. If such waivers/reimbursements had not occurred, the ratios would have been as indicated. | |
(d) | Portfolio turnover is calculated on the basis of the Fund as a whole without distinguishing among the classes of shares. | |
(e) | On April 30, 2004, the existing share Class of the Fund was renamed Class II Shares. | |
(f) | There were no fee reductions during the period. | |
(g) | For the period from April 30, 2004 (commencement of operations) through December 31, 2004. |
See accompanying notes to financial statements.
1. Organization
Nationwide Variable Insurance Trust (“NVIT” or the “Trust”) is an open-end management investment company, organized under the laws of Delaware by an amended and restated Agreement and Declaration of Trust, dated October 28, 2004, as amended to date. Prior to May 1, 2007, the Trust was named “Gartmore Variable Insurance Trust”. The Trust, originally created under the laws of Massachusetts as a Massachusetts business trust pursuant to a Declaration of Trust dated, as of June 30, 1981, and as subsequently amended, redomesticated as a Delaware Statutory Trust after the close of trading on April 29, 2005, and is registered under the Investment Company Act of 1940, as amended (the “1940 Act”). The redomestication was a change in statutory status and did not affect the operations of the Trust. As of June 30, 2007, the Trust had authorized an unlimited number of shares of beneficial interest, without par value (“shares”). The Trust currently offers shares to life insurance company separate accounts to fund the benefits under variable life insurance or annuity policies. To date, only the separate accounts of Nationwide Life Insurance Company and Nationwide Life and Annuity Insurance Company (collectively, “Nationwide”) have purchased shares of the Nationwide NVIT Investor Destinations Moderate Fund (the “Fund”) (formerly, “Gartmore GVIT Investor Destinations Moderate Fund”). The Trust currently operates forty (40) separate series, or mutual funds, each with its own investment objectives and strategies. This report contains the financial statements and financial highlights of the Fund.
The Fund is constructed as a “fund of funds,” which means that the Fund pursues its investment objective by allocating the Fund’s investments primarily among other mutual funds (the “Underlying Funds”). The Underlying Funds typically invest, either directly or indirectly, in stocks, bonds, and other securities, including the Nationwide Contract. The Nationwide Contract is a fixed interest contract issued and guaranteed by Nationwide Life Insurance Company (“Nationwide”). This contract has a stable principal value and will pay the Fund a fixed rate of interest. The fixed interest rate must be at least 3.50% (on an annual basis), but may be higher and is currently adjusted on a quarterly basis. Nationwide will calculate the interest rate in the same way that it calculates guaranteed interest rates for similar contracts. Because the contract is guaranteed by Nationwide, assuming no default, the Fund receives no more or less than the guaranteed amount and will not directly participate in the actual experience of the assets underlying the contract. Although under certain market conditions the Fund’s performance may be hurt by its investment in the Nationwide Contract, the portfolio management team believes that the relatively stable nature of the Nationwide Contract should reduce the Fund’s volatility and overall risk, especially when the bond and stock markets decline simultaneously. The Fund’s target allocation range is 5-15%.
2. Summary of Significant Accounting Policies
The following is a summary of significant accounting policies followed by the Fund in the preparation of its financial statements. The policies are in conformity with accounting principles generally accepted in the United States of America (“GAAP”). The preparation of financial statements requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of income and expenses for the period. Actual results could differ from those estimates.
(a) | Security Valuation |
Shares of the Underlying Funds in which the Fund invests are valued at their respective net asset values as reported by the Underlying Funds. The securities in the Underlying Funds generally are valued as of the close of business of the regular session of trading on the New York Stock Exchange (usually at 4 p.m. Eastern time). The Underlying Funds generally value securities and assets at current market value. Under most circumstances, the fixed interest contract is valued at par value each day, which is deemed to be fair value. The par value is calculated each day by the summation of the following factors: prior day’s par value; prior day’s interest accrued (par multiplied by guaranteed fixed rate); and current day net purchase or redemption. | |
The following policies, (b) through (h), represent the accounting policies applicable to the Underlying Funds. |
(b) | Repurchase Agreements |
The Fund may enter into repurchase agreements with an entity which is a member of the Federal Reserve System or which is a “primary dealer” (as designated by the Federal Reserve Bank of New York) in U.S. Government obligations. The repurchase price generally equals the price paid by the Fund plus interest negotiated on the basis of current short-term rates, which may be more or less than the rate on the underlying portfolio securities. The seller under a repurchase agreement is required to maintain the value of the collateral held pursuant to the agreement at a market value equal to or greater than the repurchase price (including accrued interest). Collateral subject to repurchase agreements is held by the Fund’s custodian or another qualified sub-custodian or in the Federal Reserve/ Treasury book-entry system. If the counterparty defaults and the fair value of the collateral declines, realization of the collateral by the Fund may be delayed or limited. The Fund may transfer uninvested cash balances into a pooled cash account. These balances are invested in one or more repurchase agreements, with the counterparty of Nomura Securities, which is fully collateralized by U.S. Government Agency Mortgages. |
(c) | Foreign Currency Transactions |
The accounting records of the Fund are maintained in U.S. dollars. Foreign currency amounts are translated into U.S. dollars at the current rate of exchange to determine the value of investments, assets and liabilities. The Fund may enter into foreign currency contracts in connection with purchases or sales of securities denominated in a foreign currency. Purchases and sales of securities, and income and expenses, are translated at the prevailing rate of exchange on the respective date of these transactions. The Fund does not isolate that portion of the results of operations resulting from changes in foreign exchange rates on investments from fluctuations arising from changes in market prices of securities held. These fluctuations are included with the net realized and unrealized gain or loss from investments and foreign currencies. |
(d) | Forward Foreign Currency Contracts |
The Fund may enter into forward foreign currency contracts in connection with planned purchases or sales of securities or to hedge the U.S. dollar value of portfolio securities denominated in a particular currency. The Fund could be exposed to risks if the counterparties to the contracts are unable to meet the terms of their contracts and from unanticipated movements in the value of a foreign currency relative to the U.S. dollar. Forward foreign currency contracts are valued at the current cost of covering these contracts, as provided by an independent pricing service approved by the Trust’s Board of Trustees (“Board of Trustees”). The forward foreign currency contracts are adjusted by the daily exchange rate of the underlying currency and any gains or losses are recorded for financial statement purposes as unrealized gains or losses until the contract settlement date. |
(e) | Futures Contracts |
The Fund may invest in financial futures contracts (“futures contracts”) for the purpose of hedging its existing portfolio securities or securities that the Fund intends to purchase against fluctuations in value caused by changes in prevailing market interest rates or prices. Futures contracts may also be entered into for non-hedging purposes. | |
Upon entering into a futures contract, the Fund is required to pledge to the broker an amount of cash and/or other assets equal to a certain percentage of the contract amount (initial margin deposit). Subsequent payments, known as “variation margin,” are made each day, depending on the daily fluctuations in the fair value/ market value of the underlying assets. A gain or loss equal to the daily variation margin is recognized on a daily basis. Futures contracts are valued daily at their last quoted sale price. | |
A “sale” of a futures contract means the creation of a contractual obligation to deliver the securities or foreign currency called for by the contract at a fixed price at a specified time in the future. A “purchase” of a futures contract means the creation of a contractual obligation to acquire the securities or foreign currency at a fixed price at a specified time in the future. |
Should market conditions change unexpectedly, the Fund may not achieve the anticipated benefits of the futures contracts and may realize a loss. The use of futures transactions for hedging purposes involves the risk of imperfect correlation in movements in the price of futures contracts, interest rates, and the value of the underlying hedged assets. |
(f) | Written Options Contracts |
The Fund may write options contracts. A written option obligates the Fund to deliver (written call) or to receive (written put) a specified quantity of an underlying asset at the contract amount upon exercise by the holder of the option. When the Fund writes an option, an amount equal to the premium received by the Fund is recorded as a liability and is subsequently adjusted to the current fair value of the option written. Premiums received from writing options that expire unexercised are treated by the Fund on the expiration date as realized gains from investments. The difference between the premium and the amount paid on effecting a closing purchase transaction, as a realized loss. If a call option is exercised, the premium is added to the proceeds from the sale of the underlying security or currency in determining whether the Fund has realized a gain or loss. If a put option is exercised, the premium reduces the cost basis of the securities purchased by the Fund. Options traded on an exchange are valued at the last quoted sale price, or in the absence of a sale, the bid price provided by an independent pricing service approved by the Board of Trustees. Non-exchange traded options are valued using dealer supplied quotes. The Fund as a writer of an option bears the market risk of an unfavorable change in the price of the security underlying the written option. |
(g) | Mortgage Dollar Rolls |
The Fund may enter into mortgage “dollar rolls” in which the Fund sells mortgage-backed securities for delivery in the current month and simultaneously contracts to repurchase substantially similar (same type, coupon, and maturity) securities on a specified future date. Mortgage dollar rolls may be implemented in the “to be announced” (“TBA”) market and are referred to as TBAs on the Statement of Investments of the Fund. During the roll period, the Fund foregoes principal and interest paid on the mortgage-backed securities. Each mortgage dollar roll is treated as a financing transaction; therefore, any gain or loss is considered unrealized until the roll reaches completion. Risks may arise due to the delayed payment date and the potential inability of counterparties to complete the transaction. Income is generated as consideration for entering into these transactions and is included in interest income on the Statement of Operations. |
(h) | Short Sales |
The Fund is authorized to engage in short-selling of portfolio securities which obligates the Fund to replace any security that the Fund has borrowed by purchasing the security at current market value sometime in the future. The Fund will incur a loss if the price of the security increases between the date of the short sale and the date on which the Fund replaces the borrowed security. The Fund generally will realize a gain if the price of the security declines between these dates. Until the Fund replaces the borrowed security, the Fund will maintain a segregated account with cash, U.S. Government securities and/or securities held long to sufficiently cover the Fund’s short position on a daily basis. Dividends declared on securities sold short are recorded as an expense on the ex-dividend date and paid to the counterparty on the dividend pay date. |
(i) | Security Transactions and Investment Income |
Security transactions are accounted for on the date the security is purchased or sold (“trade date”). Securities gains and losses are calculated on the identified cost basis. Interest income is recognized on the accrual basis and includes, where applicable, the amortization or accretion of premium or discount. Dividend income is recorded on the ex-dividend date. |
(j) | Distributions to Shareholders |
The Fund’s dividends from net investment income, if any, are declared and paid quarterly. The Fund’s distributions from net realized capital gains, if any, are declared and distributed at least annually. | |
Dividends and distributions to shareholders are determined in accordance with federal income tax regulations, which may differ from GAAP. These “book/tax” differences are considered either permanent or temporary in nature. In accordance with the American Institute of Certified Public Accountants Statement of Position 93-2, permanent differences (i.e., reclassification of market discounts, foreign exchange gain/ loss, paydowns, and distributions from real estate investment trusts) are reclassified within the capital accounts based on their nature for federal income tax purposes; temporary differences do not require reclassification. These reclassifications have no effect upon the net asset value of the Fund. To the extent distributions exceed current and accumulated earnings and profits for federal income tax purposes, these distributions are reported as distributions of paid-in-capital. |
(k) | Federal Income Taxes |
It is the policy of the Fund to qualify or to continue to qualify as a “regulated investment company” by complying with the provisions available to certain investment companies, as defined in Subchapter M of the U.S. Internal Revenue Code, and to make distributions of net investment income and net realized capital gains sufficient to relieve the Fund from all, or substantially all, federal income taxes. | |
As of June 30, 2007, the tax cost of securities and the breakdown of unrealized appreciation (depreciation) for the Fund was as follows: |
Net | ||||||||||||||||
Unrealized | ||||||||||||||||
Tax Cost of | Unrealized | Unrealized | Appreciation | |||||||||||||
Securities | Appreciation | Depreciation | (Depreciation) | |||||||||||||
$ | 2,711,953,028 | $ | 171,995,837 | $ | (12,097,060 | ) | $ | 159,898,777 | ||||||||
(l) | Allocation of Expenses, Income, and Gains and Losses |
Expenses directly attributable to the Fund are charged to the Fund. Expenses not directly attributable to the Fund are allocated proportionately among various or all funds within the Trust. The method used by the Fund for allocating income, fund level expenses, and realized and unrealized gains or losses is based on the fair value of shares outstanding relative to net assets. Under this method, each class of shares participates based on the total net asset value of that class’s shares in proportion to the total net assets of the Fund. Expenses specific to a class (such as Rule 12b-1 and administrative services fees) are charged to that class. |
3. Transactions with Affiliates
Under the terms of the Trust’s Investment Advisory Agreement, Nationwide Fund Advisors (formerly, Gartmore Mutual Fund Capital Trust (“GMF”)) (“NFA” or the “Advisor”) manages the investment of the assets and supervises the daily business affairs of the Fund. NFA is a wholly-owned subsidiary of Nationwide Financial Services (“NFS”).
Under the terms of the Investment Advisory Agreement, the Fund pays NFA an investment advisory fee of 0.13% based on the Fund’s average daily net assets.
Under the terms of a Fund Administration and Transfer Agency Agreement, Nationwide Fund Management, LLC (formerly, Gartmore Investor Services, Inc. (“GISI”)) (“NFM”), a wholly-owned subsidiary of NFS Distributors, Inc. (“NFSDI”), provides various administrative and accounting services for the Funds (prior to May 1, 2007, this service was provided by Gartmore SA Capital Trust (“GSA”)), and, serves as Transfer Agent and Dividend Disbursing Agent for each of the Funds (prior to May 1, 2007, this service was provided by GISI, an indirect subsidiary of GSA). The Funds do not pay a fee for these.
NFA and NFM have entered into agreements with Citi Fund Services Ohio, Inc. (“Citi”), pursuant to which Citi provides sub-administration and sub-transfer agency services, respectively, to the Fund. Effective August 1, 2007, The BISYS Group Inc. was acquired by and became a wholly owned subsidiary of Citi.
Under the terms of a Distribution Plan under Rule 12b-1 of the 1940 Act, Nationwide Fund Distributors, LLC. (formerly, “Gartmore Distribution Services, Inc. (“GDSI”)) (“NFD” or “Distributor”), the Fund’s principal underwriter, is compensated by the Fund for expenses associated with the distribution of the Class II and Class VI shares of the Fund. NFD is a wholly-owned subsidiary of NFSDI. These fees are based on average daily net assets of each class of shares of the Fund at an annual rate not to exceed 0.25%.
Under the terms of an Administrative Services Plan, the Fund may pay fees to servicing organizations, such as broker-dealers, including NFS, and financial institutions, which agree to provide administrative support services to the shareholders of certain classes. These services include, but are not limited, to the following: establishing and maintaining shareholder accounts; processing purchase and redemption transactions; arranging bank wires; performing shareholder sub-accounting; answering inquires regarding the Fund; and other such services. These fees are based on an annual rate of up to 0.25% of the average daily net assets of each class of shares of the Fund.
For the six months ended June 30, 2007, NFS received $2,016,438 in Administrative Services Fees from the Fund.
Under the terms of a letter agreement dated September 12, 2006, by and among NFA, the Audit Committee of the Trust and the Trust, the Trust has agreed to reimburse NFA certain costs related to the Fund’s portion of ongoing administration, monitoring and annual (audit) testing of the Trust’s Rule 38a-1 Compliance Program subject to the pre-approval of the Trust’s Audit Committee. For the six months ended June 30, 2007, the Fund’s portion of such costs amounted to $17,996.
Because the Fund invests primarily in other affiliated funds, the Fund is a shareholder of those Underlying Funds. The Underlying Funds do not charge the Fund any sales charge for buying or selling shares. However, the Fund indirectly pays a portion of the operating expenses, including management fees of the Underlying Funds and short-term investments the Fund holds. These expenses are deducted from the Underlying Funds before their share prices are calculated and are in addition to the fees and expenses of the Fund. Actual indirect expenses vary depending on how the Fund’s assets are spread among the underlying investments.
4. Short-Term Trading Fees
The Fund reserves the right to assess a short-term trading fee on certain transactions out of Class VI shares that a separate account makes on behalf of a variable insurance contract owner (the “contract owner”). A separate account that redeems Class VI shares on behalf of a contract owner may be subject to a 1.00% short-term trading fee if the separate account held the Class VI shares on behalf of the contract owner for 60 days or less, unless an exception applies as disclosed in the Fund’s prospectus. The short-term trading fee is paid directly to the Fund and is intended to offset the cost to the Fund of excess brokerage commissions and other costs associated with fluctuations in Fund asset levels and cash flow caused by short-term trading. For purposes of determining whether the short-term trading fee applies, the Class VI shares that were held on behalf of the contract owner the longest will be treated as being redeemed first.
For the six months ended June 30, 2007, the Fund had contributions to capital due to collection of redemption fees in the amount of $3,847.
5. Investment Transactions
For the six months ended June 30, 2007, (excluding short-term securities) the Fund had purchases of $1,987,033,357 and sales of $1,799,659,505.
6. Bank Loans and Earnings Credit
The Trust has a credit agreement with JPMorgan Chase & Co., the Fund’s custodian bank, permitting the Trust to borrow up to $100,000,000. Borrowings under this arrangement bear interest at the Federal Funds rate plus 0.50%. The
The Trust’s custodian bank has agreed to reduce the bank’s fees (earnings credit) when the funds of the Trust maintain cash on deposit in non-interest-bearing custody and Demand Deposit Accounts. Earnings credits, if any, are shown as a reduction of total expenses on the Statement of Operations.
7. Portfolio Investment Risks
Risks Associated with Foreign Securities and Currencies. Investments in securities of foreign issuers carry certain risks not ordinarily associated with investments in securities of U.S. issuers. These risks include future political and economic developments, and the possible imposition of exchange controls or other foreign governmental laws and restrictions. In addition, with respect to certain countries, there is the possibility of expropriation of assets, confiscatory taxation, political or social instability, or diplomatic developments, which could adversely affect investments in those countries.
Certain countries also may impose substantial restrictions on investments in their capital markets by foreign entities, including restrictions on investments in issuers of industries deemed sensitive to relevant national interests. These factors may limit the investment opportunities available and result in a lack of liquidity and high price volatility with respect to securities of issuers from developing countries.
8. Indemnifications
Under the Trust’s organizational documents, certain of the Trust’s Officers and Trustees are indemnified against certain liabilities arising out of the performance of their duties to the Trust. In addition, the Trust has entered into Indemnification Agreements with the Trust’s trustees and certain officers covering similar liabilities. Trust Officers receive no compensation from the Trust for serving as the Trust’s Officers. In addition, in the normal course of business, the Trust enters into contracts with its vendors and others that provide for general indemnifications. The Trust’s maximum exposure under these arrangements is unknown, as this would involve future claims that may be made against the Trust. Based on experience, however, the Trust expects that risk of loss to be remote.
9. Recently Issued Accounting Pronouncements
On July 13, 2006, the Financial Accounting Standards Board (“FASB”) released FASB Interpretation No. 48, Accounting for Uncertainty in Income Taxes (“FIN 48”). FIN 48 provides guidance for how uncertain tax positions should be recognized, measured, presented and disclosed in the financial statements. FIN 48 requires the affirmative evaluation of tax positions taken or expected to be taken in the course of preparing the Fund’s tax returns to determine whether it is more-likely-than-not (i.e., greater than 50 percent) that each tax position will be sustained upon examination by a taxing authority based on the technical merits of the position. A tax position that meets the more-likely-than-not recognition threshold is measured to determine the amount of benefit to recognize in the financial statements. Differences between tax positions taken in a tax return and amounts recognized in the financial statements will generally result in an increase in a liability for taxes payable (or a reduction of a tax refund receivable) and an increase in a deferred tax liability (or a reduction in a deferred tax asset). Adoption of FIN 48 was required no later than the last business day of the first financial statement reporting period for fiscal years beginning after December 15, 2006 and is to be applied to all open tax years as of the effective date. Accordingly, the Fund was required to implement FIN 48 in its net asset value per share (NAV) calculation on June 29, 2007. Management has evaluated the implications of FIN 48 and has concluded that there was no impact to the Fund’s financial statements as of June 29, 2007. The adoption of FIN 48 requires ongoing monitoring and analysis, future conclusions reached by management may be different and result in adjustments to the Fund’s NAV and financial statements.
In September 2006, the FASB issued Statement on Financial Accounting Standards (“SFAS”) No. 157, “Fair Value Measurements.” This standard establishes a single authoritative definition of fair value, sets out a framework for
Trustees who are not Interested Persons (as defined in the 1940 Act) and Officers of the Trust as of
Number of Portfolios | ||||||||||
Position(s) Held | in the | |||||||||
with the Trust | Principal Occupation(s) | Nationwide Fund | Other | |||||||
Name, Address | and Length of | During Past | Complex Overseen | Directorships | ||||||
and Year of Birth | Time Served1 | Five Years | by Trustee | Held by Trustee2 | ||||||
Charles E. Allen c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1948 | Trustee since July 2000 | Mr. Allen is Chairman, Chief Executive Officer and President of Graimark Realty Advisors, Inc. (real estate development, investment and asset management). | 89 | None | ||||||
Paula H.J. Cholmondeley c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1947 | Trustee since July 2000 | Ms. Cholmondeley was Vice President and General Manager of Sappi Fine Paper North America from April 2000 through December 2003. | 89 | Director of Dentsply International, Inc. (dental products), Ultralife Batteries, Inc., Terex Corporation (construction equipment), Minerals Technology, Inc. (specialty chemicals) and Albany International Corp. (paper industry) | ||||||
C. Brent DeVore3 c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1940 | Trustee since 1990 | Dr. DeVore is President of Otterbein College. | 89 | None | ||||||
Phyllis Kay Dryden c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1947 | Trustee since December 2004 | Ms. Dryden was a partner of Mitchell Madison, a management consulting company from January 2006 until December 2006; she is currently a consultant with the company. Ms. Dryden was formerly Managing Partner of march FIRST, a global management consulting firm. | 89 | None | ||||||
Barbara L. Hennigar c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1935 | Trustee since July 2000 | Retired. | 89 | None |
Number of Portfolios | ||||||||||
Position(s) Held | in the | |||||||||
with the Trust | Principal Occupation(s) | Nationwide Fund | Other | |||||||
Name, Address | and Length of | During Past | Complex Overseen | Directorships | ||||||
and Year of Birth | Time Served1 | Five Years | by Trustee | Held by Trustee2 | ||||||
Barbara I. Jacobs c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1950 | Trustee since December 2004 | Ms. Jacobs served as Chairman of the Board of Directors of KICAP Network Fund, a European (United Kingdom) hedge fund, from January 2001 through January 2006. From 1998-2003, Ms. Jacobs was also a Managing Director and European Portfolio Manager of CREF Investments (Teachers Insurance and Annuity Association-College Retirement Equities Fund). | 89 | None | ||||||
Douglas F. Kridler c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1955 | Trustee since September 1997 | Mr. Kridler has served as the President and Chief Executive Officer of the Columbus Foundation (a Columbus, OH-based foundation which manages over 1,300 individual endowment funds) since February 2002. Prior to January 31, 2002, Mr. Kridler was the President of the Columbus Association for the Performing Arts and Chairman of the Greater Columbus Convention and Visitors Bureau. | 89 | None | ||||||
Michael D. McCarthy c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1947 | Trustee since December 2004 | Retired. Mr. McCarthy was Chairman of VMAC (commodity swaps) from October 2002 until January 2007; and a partner of Pineville Properties LLC (a commercial real estate development firm) from September 2000 until January 2007. | 89 | None | ||||||
David C. Wetmore c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1948 | Trustee since 1995 and Chairman since February 2005 | Retired. | 89 | None | ||||||
1 | Length of time served includes time served with the Trust’s predecessors. | |
2 | Directorships held in (1) any other investment companies registered under the 1940 Act, (2) any company with a class of securities registered pursuant to Section 12 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or (3) any company subject to the requirements of Section 15(d) of the Exchange Act. | |
3 | Mr. DeVore has served as President of Otterbein College since 1984. Mark Thresher, President and Chief Operating Officer of Nationwide Financial Services, Inc. (“NFS”) has served as a member of the Board of Trustees of Otterbein College since 2000, currently serves as one of 30 of its trustees, and is currently one of two Vice Chairmen of the Board. Each of Nationwide Fund Advisors (“NFA”), the Funds’ investment adviser, and Nationwide Fund Distributors LLC (“NFD”), principal underwriter to the Trust, is a wholly-owned subsidiary of NFS. | |
Additional information regarding the Trustees and Officers may be found in the Trust’s Statement of Additional Information, which is available without charge upon request, by calling 800-848-0920. |
Trustees who are Interested Persons (as defined in the 1940 Act) and/or Officers of the Trust as of
Number of Portfolios | ||||||||||
Position(s) Held | in the | |||||||||
with the Trust | Principal Occupation(s) | Nationwide Fund | Other | |||||||
Name, Address | and Length of | During Past | Complex Overseen | Directorships | ||||||
and Year of Birth | Time Served1 | 5 Years | by Trustee | Held by Trustee 2 | ||||||
Arden L. Shisler c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1941 | Trustee since February 2000 | Retired. Mr. Shisler is the former President and Chief Executive Officer of KeB Transport, Inc., a trucking firm (2000 through 2002). He served as a consultant to KeB from January 2003 through December 2004. Since 1992, Mr. Shisler has also been Chairman of the Board for Nationwide Mutual Insurance Company.3 | 89 | Director of Nationwide Financial Services, Inc., Chairman of Nationwide Mutual Insurance Company3 | ||||||
John H. Grady Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1961 | President & Chief Executive Officer since December 2006 | Mr. Grady is President, and Chief Executive Officer of Nationwide Funds Group which includes Nationwide Fund Advisors,3 Nationwide Fund Management LLC,3 Nationwide Fund Distributors LLC 3 and NWD Investments,2 the asset management operations of Nationwide Mutual Insurance Company, which includes Morley Capital Management, Inc.,2 Nationwide Separate Accounts LLC,2 NorthPointe Capital LLC,2 and Nationwide SA Capital Trust2. From March 2004 until March 2006, Mr. Grady was Chief Executive Officer of Constellation Investment Management Co., L.P. (registered investment adviser), and President and Chief Executive Officer of Constellation Funds Group (registered investment companies). He also was President of Constellation Investment Distribution Co., Inc. (registered broker-dealer) from March 2004 until June 2006. From February 2001 until February 2004, Mr. Grady was Chief Operating and Chief Legal Officer; Managing Director, Mutual Funds Group, Turner Investment Partners, Inc. (registered investment adviser); Executive Vice President of Turner Funds and Turner Institutional Portfolios (registered investment companies); and President, Turner Investment Distributors, Inc. (registered broker-dealer). | N/A | None | ||||||
Gerald J. Holland Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1951 | Treasurer since March 2001 | Mr. Holland is Senior Vice President—Operations for Nationwide Funds Group3. | N/A | N/A | ||||||
Number of Portfolios | ||||||||||
Position(s) Held | in the | |||||||||
with the Trust | Principal Occupation(s) | Nationwide Fund | Other | |||||||
Name, Address | and Length of | During Past | Complex Overseen | Directorships | ||||||
and Year of Birth | Time Served1 | 5 Years | by Trustee | Held by Trustee 2 | ||||||
Michael A. Krulikowski Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1959 | Chief Compliance Officer from June 2004 to August 20074 | Mr. Krulikowski is Vice President and Chief Compliance Officer of Nationwide Funds Group3, Morley Capital Management, Inc.3, Nationwide SA Capital Trust (since 1999)3, and Nationwide Separate Accounts LLC (since August 2005).3 Since June 2004, Mr. Krulikowski has also served as Chief Compliance Officer of the Trust. From November 1999 through May 2007, he served as Vice President and Chief Compliance Officer of NorthPointe Capital LLC. 3 | N/A | N/A | ||||||
Eric E. Miller Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1953 | Secretary since December 2002 | Mr. Miller is Senior Vice President, General Counsel, and Assistant Secretary for Nationwide Funds Group3 and NWD Investments.2 From August 2000 to August 2002, Mr. Miller was a Partner with Stradley Ronon Stevens & Young, LLP. | N/A | N/A | ||||||
1 | Length of time served includes time served with the Trust’s predecessors. | |
2 | Directorships held in (1) any other investment companies registered under the 1940 Act, (2) any company with a class of securities registered pursuant to Section 12 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or (3) any company subject to the requirements of Section 15(d) of the Exchange Act. | |
3 | This position is held with an affiliated person or principal underwriter of the Trust. | |
4 | Effective August 3, 2007, the Board of Trustees approved Carol Baldwin Moody as Chief Compliance Officer of the Trust. Since November 2005, Ms. Moody has been Senior Vice President, Chief Compliance Officer of Nationwide Financial Services, Nationwide Life Insurance Company, Nationwide Life and Annuity Insurance Company, and Nationwide Investment Advisors, LLC. From February 2004-November 2005, she was Chief Compliance Officer of TIAA-CREF and from April 2000-February 2004, she was Managing Director and General Counsel, TCW/ Latin America Partners, LLC and Baeza & Co., LLC. | |
Federal law requires the Trust, each of its investment advisers and sub-advisers to adopt procedures for voting proxies (“Proxy Voting Guidelines”) and to provide a summary of those Proxy Voting Guidelines used to vote the securities held by the Funds. The Funds’ proxy voting policies and procedures are available without charge (i) upon request, by calling 800-848-0920, (ii) on the Funds’ website at www.nationwidefunds.com, or (iii) on the Securities and Exchange Commission’s website at www.sec.gov. |
A. Renewal of Investment Advisory Agreement
(i) | General Information Regarding the Board’s Review of Investment Advisory Agreements |
The Trust’s investment advisory agreements (each an “Advisory Agreement”) with its investment adviser and, as applicable, sub-advisers (together, the “Adviser”) must be approved for an initial term no greater than two years, and renewed at least annually thereafter, (i) by the vote of the Trustees or by a vote of the shareholders of each series or fund of the Trust (individually a “Fund”), and (ii) by the vote of a majority of the Trustees who are not parties to the Advisory Agreement or “interested persons” of any party thereto (the “Independent Trustees”) cast in person at a meeting called for the purpose of voting on such approval.
The Board meets quarterly and takes into account throughout the year matters bearing on each Fund’s Advisory Agreement. The Board and its standing committees consider at each meeting factors that are relevant to the annual renewal of an Advisory Agreement, including the services and support provided to a Fund and its shareholders.
On December 6, 2006, the Independent Trustees first met in person with their independent legal counsel (“Independent Legal Counsel”) to consider information provided by the Adviser and others to assist the Trustees in considering whether to renew each Fund’s Advisory Agreement for a one year term beginning May 1, 2007. Immediately following such meeting of the Independent Trustees, all Trustees met in person with the Adviser, Trust counsel, Independent Legal Counsel and others to consider such matters, and give preliminary consideration to information bearing on continuation of each Advisory Agreement. The primary purpose of the December 6 and 7, 2006 meeting was to ensure that the Trustees had ample opportunity to consider matters they deemed relevant in considering the continuation of an Advisory Agreement, and to request any additional information they considered reasonably necessary to their deliberations.
In preparation for the December 6 and 7, 2006 meeting the Trustees were provided, at the request of the Trustees, with a wide range of information to assist in their deliberations, including (i) reports from Lipper Inc. describing a Fund’s (a) performance rankings (where “first quintile” denotes the best performance) (over multiple years ended September 30, 2006) compared with performance groups and performance universes created by Lipper (and in some cases, customized peer groups created by the Adviser) of similar or peer group funds, and (b) expense rankings (where “first quintile” denotes the lowest fees and expenses) comparing the Fund’s contractual advisory fee and total expenses with expense groups and expense universes created by Lipper of similar or peer group funds, (ii) information from the Adviser describing the Fund’s performance (over multiple years ended September 30, 2006) compared with its benchmark and Lipper categories, (iii) for Funds under “close review,” copies of letters from the Adviser to the portfolio manager of each such Fund, together with the portfolio manager’s written response describing the reasons for the Fund’s underperformance (iv) information from the Adviser describing performance for the months of October and November, 2006, and annual performance for the year ended November 30, 2006, (v) reports from the Adviser describing the Adviser’s profitability in providing services under an Advisory Agreement, together with an explanation of Adviser’s methodology in calculating its profitability, (vi) information from the Adviser describing any fees paid to the Adviser for managing similar, non-affiliated institutional accounts, including the range of fee levels for such accounts, and (vii) information from the Adviser describing ancillary benefits, in addition to fees for serving as investment adviser, derived by the Adviser as a result of being investment adviser for a Fund, including, where applicable, information on soft-dollar benefits and fees inuring to the Adviser’s affiliates for serving as the Trust’s administrator, fund accountant and transfer agent.
At the December 6 and 7, 2006 meeting, the Trustees reviewed, considered and discussed, among themselves and with the Adviser, Trust counsel and Independent Legal Counsel, among other things, the information described above, and: (i) the nature, extent and quality of services provided by the Adviser under each Advisory Agreement, (ii) the investment performance of each Fund and the Adviser, (iii) the costs of the services provided by the Adviser under the Advisory Agreement and the profits realized by the Adviser thereunder, (iv) the extent to which economies of scale may be present and, if so, whether they are being shared with a Fund’s shareholders, (v) comparisons of the Adviser’s fees under the Advisory Agreement with investment advisory fees paid by peer group funds to their investment advisers and paid by non-affiliated institutional clients to the Adviser for managing similar accounts, and (vi) any ancillary benefits inuring to the Adviser and its affiliates as a result of being investment adviser for the Trust. The Trustees also considered, where
As part of the December 6 and 7, 2006 Board meeting, the Independent Trustees developed a list of follow-up matters and questions and asked that Adviser respond to such matters and questions at the contract approval meeting of the Board of Trustees to be held on January 11, 2007.
At the January 11, 2007 meeting of the Board of Trustees of the Trust, the Board received and considered information provided by the Adviser in follow-up from the December 6 and 7, 2006 Board meeting and, after consulting among themselves, and with the Adviser, Trust counsel and Independent Legal Counsel, concluded unanimously to renew the Advisory Agreement for the reasons set forth in the following section. In determining whether to renew the Advisory Agreement for the Fund, the Board ultimately reached a determination, with the assistance of Trust counsel and Independent Legal Counsel, that the renewal of the Advisory Agreement and the compensation to be received by the Adviser under the Advisory Agreement is consistent with the Board’s fiduciary duty under applicable law.
(ii) | Board Conclusions Regarding the Fund’s Advisory Agreement |
The Board considered that the Fund had underperformed its secondary benchmark (which is a more appropriate indicator of performance than the Fund’s primary benchmark) for the one-year period and outperformed its secondary benchmark for the three-year period. The Board also considered that the performance of the Fund’s Class II shares had ranked in the first quintile of the Fund’s Lipper-constructed Performance Group over the one-year period. The Board also considered that the Fund’s portfolio manager had changed during 2006 and considered the services provided by the adviser to the Fund that are in addition to the advisory services that are provided to the underlying funds. Based on its review, and giving particular weight to the nature and quality of the resources dedicated by the adviser to maintain relative performance, the Board concluded that the nature, extent, and quality of the services provided to the Fund will benefit the Fund’s shareholders.
The Board also considered that the Fund’s contractual advisory fee and breakpoints placed the Fund in the fourth quintile of its Lipper-constructed Expense Group and the Fund’s total expenses placed the Fund in the second quintile. The Board considered that total expenses were relatively low, and the advisory fee should be consistent among all of the Investor Destination Funds offered by the Trust. The Board concluded that the Fund’s management fee and total expenses were fair and reasonable in light of the services that the Fund receives and the other factors considered.
The Board considered that the Fund’s adviser reported a pre-tax profit margin for investment management services during each of the twelve month-periods ended September 30, 2006 and 2005. The Board considered the costs of the services provided by and the profits realized by the adviser in connection with the operation of the Fund and determined that the amount of profit is a fair entrepreneurial profit for the management of the Fund.
Based upon its evaluation of all of the conclusions noted above, and after considering all material factors with respect to the Fund, the Board ultimately concluded that the advisory fee structure is fair and reasonable, and that the Advisory Agreement (and, if applicable, Sub-Advisory Agreement) with respect to the Fund, should be renewed.
B. Approval of New Advisory Agreement
At its January 11, 2007 meeting, the Board also unanimously approved a new investment advisory agreement (the “New Agreement”) for the Fund with Nationwide Fund Advisors, (“NFA”) the then-current adviser to each of the series of the Trust to become effective upon the closing of the acquisition of NFA by Nationwide Financial Services, Inc. (“NFS”) from Nationwide Corporation (“NWC”) which closed on April 30, 2007 (the “Transaction”). In approving the New Agreement, the Board considered NFA’s capacity to continue to provide the services needed to operate a sophisticated investment management business and to support the management of each of the series. The Board also took into account the information provided to them at their regular quarterly meetings with NFA’s senior management with respect to the
C. Submission of Matters to a Vote of Security Holders:
On April 25, 2007, a Special Meeting of Shareholders was held* (the “April 25 Meeting”) at which shareholders of the Funds** set forth below were asked:
Proposal 1:
To approve a new investment advisory agreement, on behalf of their Fund, between Nationwide Fund Advisors (formerly “Gartmore Mutual Fund Capital Trust”) (the “Adviser”) and Nationwide Variable Insurance Trust (formerly “Gartmore Variable Insurance Trust”) (the “Trust”).
Number of Shares | ||||
Fund | Cast/Not Cast | Percentages | ||
Federated NVIT High Income Bond Fund (Formerly Federated GVIT High Income Bond Fund) | FOR 30,051,703.188 shares AGAINST 618,245.021 shares ABSTAIN 1,813,550.431 shares TOTAL 32,483,498.640 shares | 92.514% 1.903% 5.583% | ||
NVIT International Index Fund (Formerly GVIT International Index Fund) | FOR 4,322,203.982 shares AGAINST 2,758.318 shares ABSTAIN 135,636.840 shares TOTAL 4,460,599.140 shares | 96.897% 0.062% 3.041% | ||
NVIT International Value Fund (Formerly GVIT International Value Fund) | FOR 20,032,843.199 shares AGAINST 333,588.902 shares ABSTAIN 1,093,293.879 shares TOTAL 21,459,725.980 shares | 93.351% 1.554% 5.095% | ||
NVIT Mid Cap Index Fund (Formerly GVIT Mid Cap Index Fund) | FOR 35,380,179.120 shares AGAINST 631,117.844 shares ABSTAIN 1,565,714.306 shares TOTAL 37,577,011.270 shares | 94.154% 1.679% 4.167% |
Number of Shares | ||||
Fund | Cast/Not Cast | Percentages | ||
NVIT S&P 500 Index Fund (Formerly GVIT S&P 500 Index Fund) | FOR 56,119,814.230 shares AGAINST 666,195.542 shares ABSTAIN 1,944,898.888 shares TOTAL 58,730,908.660 shares | 95.554% 1.134% 3.312% | ||
Nationwide Multi-Manager NVIT Small Cap Growth Fund (Formerly GVIT Small Cap Growth Fund) | FOR 7,632,918.513 shares AGAINST 149,458.111 shares ABSTAIN 451,583.036 shares TOTAL 8,233,959.660 shares | 92.700% 1.816% 5.484% | ||
Nationwide Multi-Manager NVIT Small Cap Value Fund (Formerly GVIT Small Cap Value Fund) | FOR 48,649,396.525 shares AGAINST 979,183.753 shares ABSTAIN 2,786,133.102 shares TOTAL 52,414,713.380 shares | 92.816% 1.868% 5.316% | ||
Nationwide Multi-Manager NVIT Small Company Fund (Formerly GVIT Small Company Fund) | FOR 29,903,181.700 shares AGAINST 838,774.923 shares ABSTAIN 2,006,741.307 shares TOTAL 32,748,697.930 shares | 91.311% 2.561% 6.128% | ||
Gartmore NVIT Developing Markets Fund (Formerly Gartmore GVIT Developing Markets Fund) | FOR 21,0177,889.443 shares AGAINST 424,272.958 shares ABSTAIN 1,543,850.729 shares TOTAL 23,046,013.130 shares | 91.460% 1.841% 6.699% | ||
Gartmore NVIT Emerging Markets Fund (Formerly Gartmore GVIT Emerging Markets Fund) | FOR 17,050,534.593 shares AGAINST 526,574.722 shares ABSTAIN 881,608.905 shares TOTAL 18,458,718.220 shares | 92.371% 2.853% 4.776% | ||
Nationwide NVIT Global Financial Services Fund (Formerly Gartmore GVIT Global Financial Services Fund) | FOR 1,554,847.333 shares AGAINST 19,539.033 shares ABSTAIN 52,206.494 shares TOTAL 1,626,592.860 shares | 95.589% 1.201% 3.210% | ||
Nationwide NVIT Global Health Sciences Fund (Formerly Gartmore GVIT Global Health Sciences Fund) | FOR 4,722,963.678 shares AGAINST 157,979.030 shares ABSTAIN 207,642.222 shares TOTAL 5,088,584.930 shares | 92.815% 3.104% 4.081% | ||
Nationwide NVIT Global Technology and Communications Fund (Formerly Gartmore GVIT Global Technology and Communications Fund) | FOR 8,585,472.039 shares AGAINST 102,267.977 shares ABSTAIN 489,577.634 shares TOTAL 9,177,317.650 shares | 93.551% 1.114% 5.335% | ||
Gartmore NVIT Global Utilities Fund (Formerly Gartmore GVIT Global Utilities Fund) | FOR 4,123,270.549 shares AGAINST 122,001.533 shares ABSTAIN 240,276.088 shares TOTAL 4,485,548.170 shares | 91.923% 2.720% 5.357% |
Number of Shares | ||||
Fund | Cast/Not Cast | Percentages | ||
Nationwide NVIT Government Bond Fund (Formerly Gartmore GVIT Government Bond Fund) | FOR 88,471,567.462 shares AGAINST 1,825,645.181 shares ABSTAIN 5,841,990.727 shares TOTAL 96,139,203.370 shares | 92.024% 1.899% 6.077% | ||
Nationwide NVIT Growth Fund (Formerly Gartmore GVIT Growth Fund) | FOR 14,931,435.904 shares AGAINST 409,826.402 shares ABSTAIN 1,259,945.064 shares TOTAL 16,601,207.370 shares | 89.942% 2.469% 7.589% | ||
Gartmore NVIT International Growth Fund (Formerly Gartmore GVIT International Growth Fund) | FOR 6,251,419.070 shares AGAINST 139,618.548 shares ABSTAIN 290,025.592 shares TOTAL 6,681,063.210 shares | 93.569% 2.090% 4.341% | ||
Nationwide NVIT Investor Destinations Aggressive Fund (Formerly Gartmore GVIT Investor Destinations Aggressive Fund) | FOR 49,489,224.549 shares AGAINST 1,385,396.474 shares ABSTAIN 3,696,272.337 shares TOTAL 54,570,893.360 shares | 90.688% 2.539% 6.773% | ||
Nationwide NVIT Investor Destinations Conservative Fund (Formerly Gartmore GVIT Investor Destinations Conservative Fund) | FOR 23,091,965.887 shares AGAINST 314,935,884 shares ABSTAIN 2,292,355.179 shares TOTAL 25,699,256.950 shares | 89.855% 1.225% 8.920% | ||
Nationwide NVIT Investor Destinations Moderate Fund (Formerly Gartmore GVIT Investor Destinations Moderate Fund) | FOR 188,902,093.059 shares AGAINST 3,018,924.590 shares ABSTAIN 16,359,690.401 shares TOTAL 208,280,708.050 shares | 90.696% 1.449% 7.855% | ||
Nationwide NVIT Investor Destinations Moderately Aggressive Fund (Formerly Gartmore GVIT Investor Destinations Moderately Aggressive Fund) | FOR 134,792,622.920 shares AGAINST 3,489,207.264 shares ABSTAIN 9,304,197.656 shares TOTAL 147,586,027.840 shares | 91.332% 2.364% 6.304% | ||
Nationwide NVIT Investor Destinations Moderately Conservative Fund (Formerly Gartmore GVIT Investor Destinations Moderately Conservative Fund) | FOR 49,627,123.216 shares AGAINST 856,088.634 shares ABSTAIN 3,507,215.650 shares TOTAL 53,990,427.500 shares | 91.918% 1.586% 6.496% | ||
Nationwide NVIT Mid Cap Growth Fund (Formerly Gartmore GVIT Mid Cap Growth Fund) | FOR 10,879,584.971 shares AGAINST 352,594.958 shares ABSTAIN 717,792.971 shares TOTAL 11,949,972.900 shares | 91.043% 2.950% 6.007% |
Number of Shares | ||||
Fund | Cast/Not Cast | Percentages | ||
Nationwide NVIT Money Market Fund II (Formerly Gartmore GVIT Money Market Fund II) | FOR 221,774,863.241 shares AGAINST 12,322,482.494 shares ABSTAIN 16,471,740.875 shares TOTAL 250,569,086.610 shares | 88.508% 4.918% 6.574% | ||
Nationwide NVIT Money Market Fund (Formerly Gartmore GVIT Money Market Fund) | FOR 1,578,331,008.328 shares AGAINST 32,372,133.671 shares ABSTAIN 112,652,123.301 shares TOTAL 1,723,355,265.300 shares | 91.585% 1.878% 6.537% | ||
NVIT Nationwide Fund (Formerly Gartmore GVIT Nationwide Fund) | FOR 125,423,274.735 shares AGAINST 2,767,979.467 shares ABSTAIN 8,762,255.828 shares TOTAL 136,953,510.030 shares | 91.581% 2.021% 6.398% | ||
NVIT Nationwide Leaders Fund (Formerly Gartmore GVIT Nationwide Leaders Fund) | FOR 2,298,504.956 shares AGAINST 29,630.469 shares ABSTAIN 71,637.755 shares TOTAL 2,399,773.180 shares | 95.780% 1.235% 2.985% | ||
Nationwide NVIT U.S. Growth Leaders Fund (Formerly Gartmore GVIT U.S. Growth Leaders Fund) | FOR 4,972,094.773 shares AGAINST 122,623.161 shares ABSTAIN 174,625.606 shares TOTAL 5,269,343.540 shares | 94.359% 2.327% 3.314% | ||
Gartmore NVIT Worldwide Leaders Fund (Formerly Gartmore GVIT Worldwide Leaders Fund) | FOR 2,666,862.487 shares AGAINST 47,702.491 shares ABSTAIN 118,719.882 shares TOTAL 2,833,284.860 shares | 94.126% 1.684% 4.190% | ||
J.P. Morgan NVIT Balanced Fund (Formerly J.P. Morgan GVIT Balanced Fund) | FOR 15,966,867.546 shares AGAINST 259,004.324 shares ABSTAIN 1,339,385.200 shares TOTAL 17,565,257.070 shares | 90.900% 1.475% 7.625% | ||
Van Kampen NVIT Comstock Value Fund (Formerly Van Kampen GVIT Comstock Value Fund) | FOR 27,737,008.009 shares AGAINST 502,564.164 shares ABSTAIN 1,824,670.107 shares TOTAL 30,064,242.280 shares | 92.259% 1.672% 6.069% | ||
Van Kampen NVIT Multi Sector Bond Fund (Formerly Van Kampen GVIT Multi Sector Bond Fund) | FOR 21,253,297.665 shares AGAINST 484,100.920 shares ABSTAIN 1,803,963.645 shares TOTAL 23,541,362.230 shares | 90.281% 2.056% 7.663% | ||
At the April 25 Meeting, shareholders of the Nationwide NVIT Mid Cap Growth Fund were also asked to approve a new investment subadvisory agreement among the Adviser, the Trust and NorthPointe Capital LLC. The voting results with respect to that proposal are set forth below:
Proposal 2
Number of Shares | ||||
Fund | Cast/Not Cast | Percentages | ||
Nationwide NVIT Mid Cap Growth Fund (Formerly Gartmore GVIT Mid Cap Growth Fund) | FOR 10,862,827.499 shares AGAINST 414,574.660 shares ABSTAIN 672,570.741 shares TOTAL 11,949,972.900 shares | 90.903% 3.469% 5.628% | ||
* | This meeting was previously adjourned on April 23, 2007. | |
** | Fund names were changed effective May 1, 2007 to reflect “Nationwide”/ “NVIT” branding to coincide with the sale of Nationwide Fund Advisors, Inc. by Nationwide Corporation to its majority-owned subsidiary, Nationwide Financial Services, Inc. |
June 30, 2007 (Unaudited)
Contents | ||
6 | Statement of Investments | |
7 | Statement of Assets and Liabilities | |
8 | Statement of Operations | |
9 | Statements of Changes in Net Assets | |
11 | Financial Highlights | |
12 | Notes to Financial Statements |
Statement Regarding Availability of Proxy Voting Record.
SAR-IDMC (8/07) | ![]() |
Dear Fellow Shareholder:
Since I last wrote to you, our mutual funds have enjoyed another period of solid performance, and the corporate realignment that was in progress is now finished.
On May 1, 2007, Nationwide Financial Services, Inc. (NFS), completed its acquisition of the Philadelphia-based retail mutual fund operations of NWD Investment Management, Inc. (formerly, “Gartmore Global Investments, Inc.”), from Nationwide Corporation, a subsidiary of Nationwide Mutual Insurance Company. Effective that date, the acquired entities were renamed Nationwide Funds Group (NFG), and the Gartmore Funds were renamed the Nationwide Funds to better align with the Nationwide® brand. Although the corporate ownership and fund names have changed, I can assure you that NFG intends to maintain as much continuity as possible with the Funds and key personnel.
Thank you, shareholders, for approving the new investment advisory agreement that was required due to the change in corporate ownership. The new agreement is identical in all material respects to the original agreement that it replaces, with the exception of the section pertaining to the vote by the shareholders of the NVIT Mid Cap Growth Fund to approve NorthPointe Capital®, LLC (NorthPointe) as sub-adviser to that particular Fund.
Market Overview: January 1-June 30, 2007
Share prices in general were buoyed in part by better-than-expected first-quarter 2007 earnings and a flurry of mergers and acquisitions, many of these spurred by readily available funding from private equity firms. In June, investors grew more cautious amid surging crude oil prices, a sudden spike in long-term interest rates, and the meltdown of two hedge funds that had exposure to the subprime mortgage market. Looking abroad, a weak U.S. dollar aided foreign stocks, as reflected in the 11.09% advance of the Morgan Stanley Capital International Europe, Australasia and Far East (MSCI EAFE®) Index. Emerging market performance was particularly robust.
The bond market struggled during the first half of 2007. While short-term interest rates remained stable, reflecting the Federal Reserve Board’s decision in June to leave the target federal funds rate at 5.25%, longer-term rates climbed during the first half of 2007, depressing bond prices and forcing the Lehman Brothers® U.S. Aggregate Index to settle for a modest 0.97% return.
We at NFG thank you for your understanding and cooperation throughout our recent transition period. We emerge from this period energized for the future, and we look forward to serving your investment needs for a long time to come.
Nationwide Funds Group
PAST PERFORMANCE IS NO GUARANTEE OF FUTURE RESULTS.
Nationwide Funds are advised by Nationwide Fund Advisors (NFA). NFA is a wholly-owned subsidiary of Nationwide Financial Services. Nationwide Financial Services is a wholly-owned subsidiary of Nationwide Corporation. All of the common stock of Nationwide Corporation is held by Nationwide Mutual (95.2%) and Nationwide Mutual Fire Insurance Company (4.8%), each of which is a mutual company owned by its policyholders.
Nationwide Funds Group (NFG) is the mutual fund arm of Nationwide Financial Services (NYSE: NFS). Based in Conshohocken, Pa., a suburb of Philadelphia, NFG is comprised of Nationwide Fund Advisors, Nationwide Fund Distributors, LLC, and Nationwide Fund Management, LLC. Together, these provide advisory, distribution, and administration services respectively to the Nationwide Funds, and manage more than $43.5 billion in assets as of June 30, 2007, of which more than $12 billion are in “fund of funds” designed to provide asset allocation across several types of investments and asset classes.
Lehman Brothers (LB) U.S. Aggregate Index: An unmanaged, market value-weighted index of investment-grade, fixed-rate debt issues (including government, corporate, asset-backed, and mortgage-backed securities with maturities of one year or more) that is generally representative of the bond market as a whole.
Morgan Stanley Capital International Europe, Australasia and Far East (MSCI EAFE®) Index: An unmanaged, free float-adjusted, market capitalization-weighted index that is designed to measure the performance of stocks in developed markets outside the United States and Canada.
Standard & Poor’s 500® (S&P 500) Index: An unmanaged, market capitalization-weighted index of 500 widely held stocks of large-cap U.S. companies that gives a broad look at how the stock prices of those companies have performed.
Views expressed within are those of Nationwide Funds Group as of the date noted, are subject to change at any time, and may not come to pass.
This report is for informational purposes only, and is not intended as an offer or recommendation with respect to the purchase or sale of any security, option, future, or other derivatives in such securities.
Investing in mutual funds involves risk, including possible loss of principal.
Investors should carefully consider a fund’s investment objectives, risks, fees, charges, and expenses before investing any money. To obtain this and other fund information, please call 800-848-0920 to request a prospectus, or download a prospectus at www.nationwidefunds.com. Please read the prospectus carefully before investing any money.
Nationwide Funds distributed by Nationwide Fund Distributors LLC (formerly Gartmore Distribution Services, Inc.), Member NASD. 1200 River Road, Suite 1000, Conshohocken, Pa. 19428.
Shareholder | Nationwide NVIT Investor Destinations |
As a shareholder of the Fund, you incur two types of costs: (1) transaction costs, including sales charges (loads) paid on purchase payments and redemption fees; and (2) ongoing costs, including investment advisory fees, administration fees, distribution fees and other Fund expenses. The examples below are 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. Per SEC requirements, the examples assume that you had a $1,000 investment in the Class at the beginning of the reporting period, January 1, 2007, and continued to hold your shares at the end of the reporting period, June 30, 2007.
Actual Expenses
Hypothetical Example for Comparison Purposes
Please note that the expenses shown in the table are meant to highlight your ongoing costs only and do not reflect any transaction costs, such as sales charges (loads) or redemption fees. Therefore, the second line for each Class in 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 transaction costs were included, your costs would have been higher. The examples also assume all dividends and distributions have been reinvested.
Schedule of Shareholder Expenses
Nationwide NVIT Investor Destinations | ||||||||||||||||||||||
Moderately Conservative Fund | ||||||||||||||||||||||
Beginning | Ending | Expenses Paid | Annualized | |||||||||||||||||||
Account Value, | Account | During | Expense | |||||||||||||||||||
January 1, 2007 | Value, | Period*2 | Ratio*2 | |||||||||||||||||||
June 30, 2007 | ||||||||||||||||||||||
Class II | Actual | $ | 1,000.00 | $ | 1,041.40 | $ | 2.68 | 0.53% | ||||||||||||||
Hypothetical | 1 | $ | 1,000.00 | $ | 1,022.17 | $ | 2.66 | 0.53% | ||||||||||||||
Class VI | Actual | $ | 1,000.00 | $ | 1,041.30 | $ | 2.83 | 0.56% | ||||||||||||||
Hypothetical | 1 | $ | 1,000.00 | $ | 1,022.02 | $ | 2.81 | 0.56% | ||||||||||||||
* | Expenses are equal to the Fund’s annualized expense ratio multiplied by the average account value over the period multiplied by 181/365 (to reflect the one-half year period). The expense ratio presented represents a six-month, annualized ratio in accordance with SEC guidelines. The expenses reported above do not include the effect of additional expenses imposed by variable annuity contracts. | |
1 | Represents the hypothetical 5% return before expenses. | |
2 | Expenses are based on the direct expenses of the Fund and do not include the effect of the underlying Funds’ expenses, which are disclosed in the Fee and Expense table and described more fully in a footnote to that table in your Fund prospectus. |
Portfolio Summary | Nationwide NVIT Investor Destinations Moderately Conservative Fund |
Asset Allocation | ||||
Mutual Funds | 82.9% | |||
Fixed Contract | 17.0% | |||
Other assets in excess of liabilities | 0.1% | |||
100.0% |
Asset Allocation Detail | ||||
Fixed Income Funds | 43.0% | |||
Equity Funds | 39.9% | |||
Fixed Contract | 17.0% | |||
Other | 0.1% | |||
100.0% |
Top Holdings | ||||
Nationwide NVIT Bond Index Fund, ID Class | 35.1% | |||
NVIT S&P 500 Index Fund, ID Class | 19.9% | |||
Nationwide Fixed Contract, 3.95% | 17.0% | |||
NVIT Mid Cap Index Fund, ID Class | 9.9% | |||
Nationwide International Index Fund, Institutional Class | 8.8% | |||
Nationwide NVIT Enhanced Income Fund, ID Class | 7.9% | |||
NVIT International Index Fund, ID Class | 1.3% | |||
Other | 0.1% | |||
100.0% |
Nationwide NVIT Investor Destinations Moderately Conservative Fund
MUTUAL FUNDS (82.9%)(a) | ||||||||
Shares or | ||||||||
Principal Amount | Value | |||||||
Equity Funds (39.9%) | ||||||||
NVIT S&P 500 Index Fund, ID Class | 14,253,605 | $ | 149,235,242 | |||||
NVIT Mid Cap Index Fund, ID Class | 3,721,262 | 74,574,094 | ||||||
NVIT International Index Fund, ID Class | 821,543 | 9,694,204 | ||||||
Nationwide International Index Fund, Institutional Class | 5,524,315 | 65,628,865 | ||||||
Fixed Income Funds (43.0%) | ||||||||
Nationwide NVIT Enhanced Income Fund, ID Class | 5,908,200 | 59,081,997 | ||||||
Nationwide NVIT Bond Index Fund, ID Class | 26,727,329 | 262,729,643 | ||||||
Total Mutual Funds (Cost $597,982,435) | 620,944,045 | |||||||
FIXED CONTRACT (17.0%)(a) (b) | ||||||||
Shares or | ||||||||
Principal Amount | Value | |||||||
Nationwide Fixed Contract, 3.95% | $ | 127,832,194 | $ | 127,832,194 | ||||
Total Investments (Cost $725,814,629) (c) — 99.9% | 748,776,239 | |||||||
Other assets in excess of liabilities — 0.1% | 422,829 | |||||||
NET ASSETS — 100.0% | $ | 749,199,068 | ||||||
(a) | Investment in affiliate. | |
(b) | The Nationwide Fixed Contract rate changes quarterly. The security is restricted and as the affiliated counterparty is required by contract to redeem within five days upon request, it has been deemed liquid pursuant to procedures approved by the Board of Trustees. | |
(c) | See notes to financial statements for tax unrealized appreciation (depreciation) of securities. |
See accompanying notes to financial statements.
Nationwide NVIT | ||||||
Investor | ||||||
Destinations Moderately | ||||||
Conservative Fund | ||||||
Assets: | ||||||
Investments in affiliates, at value (cost $725,814,629) | $ | 748,776,239 | ||||
Cash | 63 | |||||
Interest and dividends receivable | 27,668 | |||||
Receivable for capital shares issued | 868,148 | |||||
Prepaid expenses | 7,332 | |||||
Total Assets | 749,679,450 | |||||
Liabilities: | ||||||
Payable for capital shares redeemed | 190,341 | |||||
Accrued expenses and other payables: | ||||||
Investment advisory fees | 78,962 | |||||
Distribution fees | 151,851 | |||||
Administrative servicing fees | 5,842 | |||||
Compliance program costs | 8,238 | |||||
Other | 45,148 | |||||
Total Liabilities | 480,382 | |||||
Net Assets | $ | 749,199,068 | ||||
Represented by: | ||||||
Capital | $ | 692,574,081 | ||||
Accumulated net investment loss | (172,956 | ) | ||||
Accumulated net realized gains from investment transactions | 33,836,333 | |||||
Net unrealized appreciation on investments | 22,961,610 | |||||
Net Assets | $ | 749,199,068 | ||||
Net Assets: | ||||||
Class II Shares | $ | 743,148,363 | ||||
Class VI Shares | 6,050,705 | |||||
Total | $ | 749,199,068 | ||||
Shares outstanding (unlimited number of shares authorized): | ||||||
Class II Shares | 65,506,048 | |||||
Class VI Shares | 535,240 | |||||
Total | 66,041,288 | |||||
Net asset value and offering price per share (Net assets by class divided by shares outstanding by class, respectively.):* | ||||||
Class II Shares | $ | 11.34 | ||||
Class VI Shares | $ | 11.30 | ||||
* | Not subject to a front-end sales charge. |
7
Nationwide NVIT | |||||
Investor Destinations | |||||
Moderately | |||||
Conservative Fund | |||||
INVESTMENT INCOME: | |||||
Interest income from affiliates | $ | 2,255,315 | |||
Dividend income from affiliates | 9,575,401 | ||||
Total Income | 11,830,716 | ||||
Expenses: | |||||
Investment advisory fees | 439,887 | ||||
Distribution fees Class II Shares | 840,132 | ||||
Distribution fees Class VI Shares | 5,813 | ||||
Administrative servicing fees Class II Shares | 421,057 | ||||
Administrative servicing fees Class VI Shares | 3,526 | ||||
Trustee fees | 15,583 | ||||
Compliance program costs (Note 3) | 4,445 | ||||
Other | 71,478 | ||||
Total expenses before earnings credit | 1,801,921 | ||||
Earnings credit (Note 6) | (23 | ) | |||
Net Expenses | 1,801,898 | ||||
Net Investment Income | 10,028,818 | ||||
REALIZED/ UNREALIZED GAINS (LOSSES) FROM INVESTMENTS: | |||||
Realized gains on investment transactions with affiliates | 31,453,564 | ||||
Realized gain distributions from underlying funds | 3,974,841 | ||||
Net realized gains on investment transactions | 35,428,405 | ||||
Net change in unrealized depreciation on investments | (18,077,552 | ) | |||
Net realized/unrealized gains (losses) on investments | 17,350,853 | ||||
CHANGE IN NET ASSETS RESULTING FROM OPERATIONS | $ | 27,379,671 | |||
8
Nationwide NVIT Investor Destinations | |||||||||
Moderately Conservative Fund | |||||||||
Six Months Ended | Year Ended | ||||||||
June 30, 2007 | December 31, 2006 | ||||||||
(Unaudited) | |||||||||
FROM INVESTMENT ACTIVITIES: | |||||||||
Operations: | |||||||||
Net investment income | $ | 10,028,818 | $ | 15,557,112 | |||||
Net realized gains on investment transactions | 35,428,405 | 19,456,603 | |||||||
Net change in unrealized appreciation/depreciation on investment transactions | (18,077,552 | ) | 12,268,968 | ||||||
Change in net assets resulting from operations | 27,379,671 | 47,282,683 | |||||||
Distributions to shareholders from: | |||||||||
Net investment income: | |||||||||
Class II | (10,499,545 | ) | (16,134,868 | ) | |||||
Class VI | (81,492 | ) | (112,038 | ) | |||||
Net realized gains on investments: | |||||||||
Class II | (19,126,179 | ) | (7,615,982 | ) | |||||
Class VI | (146,726 | ) | (54,581 | ) | |||||
Change in net assets from shareholder distributions | (29,853,942 | ) | (23,917,469 | ) | |||||
Change in net assets from capital transactions | 114,259,469 | 84,357,639 | |||||||
Change in net assets | 111,785,198 | 107,722,853 | |||||||
Net Assets: | |||||||||
Beginning of period | 637,413,870 | 529,691,017 | |||||||
End of period | $ | 749,199,068 | $ | 637,413,870 | |||||
Accumulated net investment income (loss) at end of period | $ | (172,956 | ) | $ | 379,263 | ||||
CAPITAL TRANSACTIONS: | |||||||||
Class II Shares | |||||||||
Proceeds from shares issued | $ | 112,391,318 | $ | 150,330,307 | |||||
Dividends reinvested | 29,625,664 | 23,750,847 | |||||||
Cost of shares redeemed (a) | (30,221,585 | ) | (88,939,907 | ) | |||||
111,795,397 | 85,141,247 | ||||||||
Class VI Shares | |||||||||
Proceeds from shares issued | 2,972,038 | 2,826,367 | |||||||
Dividends reinvested | 228,218 | 166,619 | |||||||
Cost of shares redeemed (a) | (736,184 | ) | (3,776,594 | ) | |||||
2,464,072 | (783,608 | ) | |||||||
Change in net assets from capital transactions | $ | 114,259,469 | $ | 84,357,639 | |||||
SHARE TRANSACTIONS: | |||||||||
Class II Shares | |||||||||
Issued | 9,675,686 | 13,566,353 | |||||||
Reinvested | 2,609,818 | 2,166,399 | |||||||
Redeemed | (2,616,451 | ) | (8,046,126 | ) | |||||
9,669,053 | 7,686,626 | ||||||||
9
Nationwide NVIT Investor Destinations | |||||||||
Moderately Conservative Fund | |||||||||
Six Months Ended | Year Ended | ||||||||
June 30, 2007 | December 31, 2006 | ||||||||
(Unaudited) | |||||||||
SHARE TRANSACTIONS: (continued) | |||||||||
Class VI Shares | |||||||||
Issued | 258,306 | 254,900 | |||||||
Reinvested | 20,176 | 15,249 | |||||||
Redeemed | (64,085 | ) | (340,660 | ) | |||||
214,397 | (70,511 | ) | |||||||
Total change in shares | 9,883,450 | 7,616,115 | |||||||
(a) | Includes redemption fees, if any. |
10
Distributions | ||||||||||||||||||||
Investment Activities | ||||||||||||||||||||
Net Realized | ||||||||||||||||||||
and | ||||||||||||||||||||
Net Asset | Unrealized | Total | ||||||||||||||||||
Value, | Net | Gains | from | Net | ||||||||||||||||
Beginning | Investment | (Losses) on | Investment | Investment | ||||||||||||||||
of Period | Income | Investments | Activities | Income | ||||||||||||||||
Class II Shares | ||||||||||||||||||||
For the year ended December 31, 2002 | $ | 10.04 | 0.18 | (0.60 | ) | (0.42 | ) | (0.18 | ) | |||||||||||
For the year ended December 31, 2003 | $ | 9.43 | 0.21 | 1.07 | 1.28 | (0.21 | ) | |||||||||||||
For the year ended December 31, 2004 (e) | $ | 10.48 | 0.23 | 0.50 | 0.73 | (0.23 | ) | |||||||||||||
For the year ended December 31, 2005 | $ | 10.91 | 0.28 | 0.20 | 0.48 | (0.28 | ) | |||||||||||||
For the year ended December 31, 2006 | $ | 10.91 | 0.30 | 0.60 | 0.90 | (0.31 | ) | |||||||||||||
For the six months ended June 30, 2007 (Unaudited) | $ | 11.35 | 0.15 | 0.31 | 0.46 | (0.17 | ) | |||||||||||||
Class VI Shares | ||||||||||||||||||||
Period ended December 31, 2004 (f) | $ | 10.44 | 0.20 | 0.49 | 0.69 | (0.20 | ) | |||||||||||||
For the year ended December 31, 2005 | $ | 10.90 | 0.30 | 0.20 | 0.50 | (0.30 | ) | |||||||||||||
For the year ended December 31, 2006 | $ | 10.90 | 0.30 | 0.59 | 0.89 | (0.32 | ) | |||||||||||||
For the six months ended June 30, 2007 (Unaudited) | $ | 11.32 | 0.15 | 0.31 | 0.46 | (0.18 | ) | |||||||||||||
[Additional columns below]
[Continued from above table, first column(s) repeated]
Distributions | ||||||||||||||||||||||||
Net Assets | Ratio of | |||||||||||||||||||||||
Net | Net Asset | at End of | Expenses | |||||||||||||||||||||
realized | Total | Value, End | Total | Period | to Average | |||||||||||||||||||
gains | Distributions | of Period | Return (a) | (000s) | Net Assets (b) | |||||||||||||||||||
Class II Shares | ||||||||||||||||||||||||
For the year ended December 31, 2002 | (0.01 | ) | (0.19 | ) | $ | 9.43 | (4.15% | ) | $ | 95,669 | 0.56% | |||||||||||||
For the year ended December 31, 2003 | (0.02 | ) | (0.23 | ) | $ | 10.48 | 13.70% | $ | 258,529 | 0.56% | ||||||||||||||
For the year ended December 31, 2004 (e) | (0.07 | ) | (0.30 | ) | $ | 10.91 | 7.16% | $ | 425,066 | 0.56% | ||||||||||||||
For the year ended December 31, 2005 | (0.20 | ) | (0.48 | ) | $ | 10.91 | 4.49% | $ | 525,426 | 0.56% | ||||||||||||||
For the year ended December 31, 2006 | (0.15 | ) | (0.46 | ) | $ | 11.35 | 8.42% | $ | 633,782 | 0.57% | ||||||||||||||
For the six months ended June 30, 2007 (Unaudited) | (0.30 | ) | (0.47 | ) | $ | 11.34 | 4.14% | $ | 743,148 | 0.53% | ||||||||||||||
Class VI Shares | ||||||||||||||||||||||||
Period ended December 31, 2004 (f) | (0.03 | ) | (0.23 | ) | $ | 10.90 | 6.67% | $ | 719 | 0.41% | ||||||||||||||
For the year ended December 31, 2005 | (0.20 | ) | (0.50 | ) | $ | 10.90 | 4.65% | $ | 4,265 | 0.48% | ||||||||||||||
For the year ended December 31, 2006 | (0.15 | ) | (0.47 | ) | $ | 11.32 | 8.39% | $ | 3,632 | 0.57% | ||||||||||||||
For the six months ended June 30, 2007 (Unaudited) | (0.30 | ) | (0.48 | ) | $ | 11.30 | 4.13% | $ | 6,051 | 0.56% | ||||||||||||||
[Additional columns below]
[Continued from above table, first column(s) repeated]
Ratios/Supplemental Data | ||||||||||||||||||
Ratio of Net | ||||||||||||||||||
Ratio of | Investment | |||||||||||||||||
Ratio of Net | Expenses | Income | ||||||||||||||||
Investment | (Prior to | (Prior to | ||||||||||||||||
Income | Reimbursements) | Reimbursements) | ||||||||||||||||
to Average | to Average | to Average | Portfolio | |||||||||||||||
Net Assets (b) | Net Assets (b)(c) | Net Assets (b)(c) | Turnover (d) | |||||||||||||||
Class II Shares | ||||||||||||||||||
For the year ended December 31, 2002 | 2.96% | (g) | (g) | 35.19% | ||||||||||||||
For the year ended December 31, 2003 | 2.32% | (g) | (g) | 12.61% | ||||||||||||||
For the year ended December 31, 2004 (e) | 2.35% | (g) | (g) | 7.18% | ||||||||||||||
For the year ended December 31, 2005 | 2.66% | (g) | (g) | 11.32% | ||||||||||||||
For the year ended December 31, 2006 | 2.69% | (g) | (g) | 17.68% | ||||||||||||||
For the six months ended June 30, 2007 (Unaudited) | 2.89% | 0.53% | 2.89% | 83.62% | ||||||||||||||
Class VI Shares | ||||||||||||||||||
Period ended December 31, 2004 (f) | 3.37% | (g) | (g) | 7.18% | ||||||||||||||
For the year ended December 31, 2005 | 2.65% | (g) | (g) | 11.32% | ||||||||||||||
For the year ended December 31, 2006 | 2.65% | (g) | (g) | 17.68% | ||||||||||||||
For the six months ended June 30, 2007 (Unaudited) | 2.98% | 0.56% | 2.98% | 83.62% | ||||||||||||||
(a) | Not annualized for periods less than one year. | |
(b) | Annualized for periods less than one year. | |
(c) | During the period, certain fees were waived and/or reimbursed. If such waivers/reimbursements had not occurred, the ratios would have been as indicated. | |
(d) | Portfolio turnover is calculated on the basis of the Fund as a whole without distinguishing among the classes of shares. | |
(e) | On April 30, 2004, the existing share Class of the Fund was renamed Class II Shares. | |
(f) | For the period from April 30, 2004 (commencement of operations) through December 31, 2004. | |
(g) | There were no fee reductions during the period. |
See accompanying notes to financial statements.
1. Organization
Nationwide Variable Insurance Trust (“NVIT” or the “Trust”) is an open-end management investment company, organized under the laws of Delaware by an amended and restated Agreement and Declaration of Trust, dated October 28, 2004, as amended to date. Prior to May 1, 2007, the Trust was named “Gartmore Variable Insurance Trust”. The Trust, originally created under the laws of Massachusetts as a Massachusetts business trust pursuant to a Declaration of Trust dated, as of June 30, 1981, and as subsequently amended, redomesticated as a Delaware Statutory Trust after the close of trading on April 29, 2005, and is registered under the Investment Company Act of 1940, as amended (the “1940 Act”). The redomestication was a change in statutory status and did not affect the operations of the Trust. As of June 30, 2007, the Trust had authorized an unlimited number of shares of beneficial interest, without par value (“shares”). The Trust currently offers shares to life insurance company separate accounts to fund the benefits under variable life insurance or annuity policies. To date, only the separate accounts of Nationwide Life Insurance Company and Nationwide Life and Annuity Insurance Company (collectively, “Nationwide”) have purchased shares of the Nationwide NVIT Investor Destinations Moderately Conservative Fund (the “Fund”) (formerly, “Gartmore GVIT Investor Destinations Moderately Conservative Fund”). The Trust currently operates forty (40) separate series, or mutual funds, each with its own investment objectives and strategies. This report contains the financial statements and financial highlights of the Fund.
The Fund is constructed as a “fund of funds,” which means that the Fund pursues its investment objective by allocating the Fund’s investments primarily among other mutual funds (the “Underlying Funds”). The Underlying Funds typically invest, either directly or indirectly, in stocks, bonds, and other securities, including the Nationwide Contract. The Nationwide Contract is a fixed interest contract issued and guaranteed by Nationwide Life Insurance Company (“Nationwide”). This contract has a stable principal value and will pay the Fund a fixed rate of interest. The fixed interest rate must be at least 3.50% (on an annual basis), but may be higher and is currently adjusted on a quarterly basis. Nationwide will calculate the interest rate in the same way that it calculates guaranteed interest rates for similar contracts. Because the contract is guaranteed by Nationwide, assuming no default, the Fund receives no more or less than the guaranteed amount and will not directly participate in the actual experience of the assets underlying the contract. Although under certain market conditions the Fund’s performance may be hurt by its investment in the Nationwide Contract, the portfolio management team believes that the relatively stable nature of the Nationwide Contract should reduce the Fund’s volatility and overall risk, especially when the bond and stock markets decline simultaneously. The Fund’s target allocation range is 10-20%.
2. Summary of Significant Accounting Policies
The following is a summary of significant accounting policies followed by the Fund in the preparation of its financial statements. The policies are in conformity with accounting principles generally accepted in the United States of America (“GAAP”). The preparation of financial statements requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of income and expenses for the period. Actual results could differ from those estimates.
(a) | Security Valuation |
Shares of the Underlying Funds in which the Fund invests are valued at their respective net asset values as reported by the Underlying Funds. The securities in the Underlying Funds generally are valued as of the close of business of the regular session of trading on the New York Stock Exchange (usually at 4 p.m. Eastern time). The Underlying Funds generally value securities and assets at current market value. Under most circumstances, the fixed interest contract is valued at par value each day, which is deemed to be fair value. The par value is calculated each day by the summation of the following factors: prior day’s par value; prior day’s interest accrued (par multiplied by guaranteed fixed rate); and current day net purchase or redemption. | |
The following policies, (b) through (h), represent the accounting policies applicable to the Underlying Funds. |
(b) | Repurchase Agreements |
The Fund may enter into repurchase agreements with an entity which is a member of the Federal Reserve System or which is a “primary dealer” (as designated by the Federal Reserve Bank of New York) in U.S. Government obligations. The repurchase price generally equals the price paid by the Fund plus interest negotiated on the basis of current short-term rates, which may be more or less than the rate on the underlying portfolio securities. The seller under a repurchase agreement is required to maintain the value of the collateral held pursuant to the agreement at a market value equal to or greater than the repurchase price (including accrued interest). Collateral subject to repurchase agreements is held by the Fund’s custodian or another qualified sub-custodian or in the Federal Reserve/ Treasury book-entry system. If the counterparty defaults and the fair value of the collateral declines, realization of the collateral by the Fund may be delayed or limited. The Fund may transfer uninvested cash balances into a pooled cash account. These balances are invested in one or more repurchase agreements, with the counterparty of Nomura Securities, which is fully collateralized by U.S. Government Agency Mortgages. |
(c) | Foreign Currency Transactions |
The accounting records of the Fund are maintained in U.S. dollars. Foreign currency amounts are translated into U.S. dollars at the current rate of exchange to determine the value of investments, assets and liabilities. The Fund may enter into foreign currency contracts in connection with purchases or sales of securities denominated in a foreign currency. Purchases and sales of securities, and income and expenses, are translated at the prevailing rate of exchange on the respective date of these transactions. The Fund does not isolate that portion of the results of operations resulting from changes in foreign exchange rates on investments from fluctuations arising from changes in market prices of securities held. These fluctuations are included with the net realized and unrealized gain or loss from investments and foreign currencies. |
(d) | Forward Foreign Currency Contracts |
The Fund may enter into forward foreign currency contracts in connection with planned purchases or sales of securities or to hedge the U.S. dollar value of portfolio securities denominated in a particular currency. The Fund could be exposed to risks if the counterparties to the contracts are unable to meet the terms of their contracts and from unanticipated movements in the value of a foreign currency relative to the U.S. dollar. Forward foreign currency contracts are valued at the current cost of covering these contracts, as provided by an independent pricing service approved by the Trust’s Board of Trustees (“Board of Trustees”). The forward foreign currency contracts are adjusted by the daily exchange rate of the underlying currency and any gains or losses are recorded for financial statement purposes as unrealized gains or losses until the contract settlement date. |
(e) | Futures Contracts |
The Fund may invest in financial futures contracts (“futures contracts”) for the purpose of hedging its existing portfolio securities or securities that the Fund intends to purchase against fluctuations in value caused by changes in prevailing market interest rates or prices. Futures contracts may also be entered into for non-hedging purposes. | |
Upon entering into a futures contract, the Fund is required to pledge to the broker an amount of cash and/or other assets equal to a certain percentage of the contract amount (initial margin deposit). Subsequent payments, known as “variation margin,” are made each day, depending on the daily fluctuations in the fair value/market value of the underlying assets. A gain or loss equal to the daily variation margin is recognized on a daily basis. Futures contracts are valued daily at their last quoted sale price. | |
A “sale” of a futures contract means the creation of a contractual obligation to deliver the securities or foreign currency called for by the contract at a fixed price at a specified time in the future. A “purchase” of a futures contract means the creation of a contractual obligation to acquire the securities or foreign currency at a fixed price at a specified time in the future. |
Should market conditions change unexpectedly, the Fund may not achieve the anticipated benefits of the futures contracts and may realize a loss. The use of futures transactions for hedging purposes involves the risk of imperfect correlation in movements in the price of futures contracts, interest rates, and the value of the underlying hedged assets. |
(f) | Written Options Contracts |
The Fund may write options contracts. A written option obligates the Fund to deliver (written call) or to receive (written put) a specified quantity of an underlying asset at the contract amount upon exercise by the holder of the option. When the Fund writes an option, an amount equal to the premium received by the Fund is recorded as a liability and is subsequently adjusted to the current fair value of the option written. Premiums received from writing options that expire unexercised are treated by the Fund on the expiration date as realized gains from investments. The difference between the premium and the amount paid on effecting a closing purchase transaction, as a realized loss. If a call option is exercised, the premium is added to the proceeds from the sale of the underlying security or currency in determining whether the Fund has realized a gain or loss. If a put option is exercised, the premium reduces the cost basis of the securities purchased by the Fund. Options traded on an exchange are valued at the last quoted sale price, or in the absence of a sale, the bid price provided by an independent pricing service approved by the Board of Trustees. Non-exchange traded options are valued using dealer supplied quotes. The Fund as a writer of an option bears the market risk of an unfavorable change in the price of the security underlying the written option. |
(g) | Mortgage Dollar Rolls |
The Fund may enter into mortgage “dollar rolls” in which the Fund sells mortgage-backed securities for delivery in the current month and simultaneously contracts to repurchase substantially similar (same type, coupon, and maturity) securities on a specified future date. Mortgage dollar rolls may be implemented in the “to be announced” (“TBA”) market and are referred to as TBAs on the Statement of Investments of the Fund. During the roll period, the Fund foregoes principal and interest paid on the mortgage-backed securities. Each mortgage dollar roll is treated as a financing transaction; therefore, any gain or loss is considered unrealized until the roll reaches completion. Risks may arise due to the delayed payment date and the potential inability of counterparties to complete the transaction. Income is generated as consideration for entering into these transactions and is included in interest income on the Statement of Operations. |
(h) | Short Sales |
The Fund is authorized to engage in short-selling of portfolio securities which obligates the Fund to replace any security that the Fund has borrowed by purchasing the security at current market value sometime in the future. The Fund will incur a loss if the price of the security increases between the date of the short sale and the date on which the Fund replaces the borrowed security. The Fund generally will realize a gain if the price of the security declines between these dates. Until the Fund replaces the borrowed security, the Fund will maintain a segregated account with cash, U.S. Government securities and/or securities held long to sufficiently cover the Fund’s short position on a daily basis. Dividends declared on securities sold short are recorded as an expense on the ex-dividend date and paid to the counterparty on the dividend pay date. |
(i) | Security Transactions and Investment Income |
Security transactions are accounted for on the date the security is purchased or sold (“trade date”). Securities gains and losses are calculated on the identified cost basis. Interest income is recognized on the accrual basis and includes, where applicable, the amortization or accretion of premium or discount. Dividend income is recorded on the ex-dividend date. |
(j) | Distributions to Shareholders |
The Fund’s dividends from net investment income, if any, are declared and paid quarterly. The Fund’s distributions from net realized capital gains, if any, are declared and distributed at least annually. | |
Dividends and distributions to shareholders are determined in accordance with federal income tax regulations, which may differ from GAAP. These “book/tax” differences are considered either permanent or temporary in nature. In accordance with the American Institute of Certified Public Accountants Statement of Position 93-2, permanent differences (i.e., reclassification of market discounts, foreign exchange gain/loss, paydowns, and distributions from real estate investment trusts) are reclassified within the capital accounts based on their nature for federal income tax purposes; temporary differences do not require reclassification. These reclassifications have no effect upon the net asset value of the Fund. To the extent distributions exceed current and accumulated earnings and profits for federal income tax purposes, these distributions are reported as distributions of paid-in-capital. |
(k) | Federal Income Taxes |
It is the policy of the Fund to qualify or to continue to qualify as a “regulated investment company” by complying with the provisions available to certain investment companies, as defined in Subchapter M of the U.S. Internal Revenue Code, and to make distributions of net investment income and net realized capital gains sufficient to relieve the Fund from all, or substantially all, federal income taxes. | |
As of June 30, 2007, the tax cost of securities and the breakdown of unrealized appreciation (depreciation) for the Fund was as follows: |
Net | ||||||||||||||||
Unrealized | ||||||||||||||||
Tax Cost of | Unrealized | Unrealized | Appreciation | |||||||||||||
Securities | Appreciation | Depreciation | (Depreciation) | |||||||||||||
$ | 725,820,140 | $ | 27,323,000 | $ | (4,366,901 | ) | $ | 22,956,099 | ||||||||
Expenses directly attributable to the Fund are charged to the Fund. Expenses not directly attributable to the Fund are allocated proportionately among various or all funds within the Trust. The method used by the Fund for allocating income, fund level expenses, and realized and unrealized gains or losses is based on the fair value of shares outstanding relative to net assets. Under this method, each class of shares participates based on the total net asset value of that class’s shares in proportion to the total net assets of the Fund. Expenses specific to a class (such as Rule 12b-1 and administrative services fees) are charged to that class. |
3. Transactions with Affiliates
Under the terms of the Trust’s Investment Advisory Agreement, Nationwide Fund Advisors (formerly, Gartmore Mutual Fund Capital Trust (“GMF”)) (“NFA” or the “Advisor”) manages the investment of the assets and supervises the daily business affairs of the Fund. NFA is a wholly-owned subsidiary of Nationwide Financial Services (“NFS”).
Under the terms of the Investment Advisory Agreement, the Fund pays NFA an investment advisory fee of 0.13% based on the Fund’s average daily net assets.
Under the terms of a Fund Administration and Transfer Agency Agreement, Nationwide Fund Management, LLC (formerly, Gartmore Investor Services, Inc. (“GISI”)) (“NFM”), a wholly-owned subsidiary of NFS Distributors, Inc. (“NFSDI”), provides various administrative and accounting services for the Funds (prior to May 1, 2007, this service was provided by Gartmore SA Capital Trust (“GSA”)), and, serves as Transfer Agent and Dividend Disbursing Agent for each of the Funds (prior to May 1, 2007, this service was provided by GISI, an indirect subsidiary of GSA). The Funds do not pay a fee for these.
NFA and NFM have entered into agreements with Citi Fund Services Ohio, Inc. (“Citi”), pursuant to which Citi provides sub-administration and sub-transfer agency services, respectively, to the Fund. Effective August 1, 2007, The BISYS Group Inc. was acquired by and became a wholly owned subsidiary of Citi.
Under the terms of a Distribution Plan under Rule 12b-1 of the 1940 Act, Nationwide Fund Distributors, LLC. (formerly, “Gartmore Distribution Services, Inc. (“GDSI”)) (“NFD” or “Distributor”), the Fund’s principal underwriter, is compensated by the Fund for expenses associated with the distribution of the Class II and Class VI shares of the Fund. NFD is a wholly-owned subsidiary of NFSDI. These fees are based on average daily net assets of each class of shares of the Fund at an annual rate not to exceed 0.25%.
Under the terms of an Administrative Services Plan, the Fund may pay fees to servicing organizations, such as broker-dealers, including NFS, Inc, and financial institutions, which agree to provide administrative support services to the shareholders of certain classes. These services include, but are not limited, to the following: establishing and maintaining shareholder accounts; processing purchase and redemption transactions; arranging bank wires; performing shareholder sub-accounting; answering inquires regarding the Fund; and other such services. These fees are based on an annual rate of up to 0.25% of the average daily net assets of each class of shares of the Fund.
For the six months ended June 30, 2007, NFS received $508,087 in Administrative Services Fees from the Fund.
Under the terms of a letter agreement dated September 12, 2006, by and among NFA, the Audit Committee of the Trust and the Trust, the Trust has agreed to reimburse NFA certain costs related to the Fund’s portion of ongoing administration, monitoring and annual (audit) testing of the Trust’s Rule 38a-1 Compliance Program subject to the pre-approval of the Trust’s Audit Committee. For the six months ended June 30, 2007, the Fund’s portion of such costs amounted to $4,445.
Because the Fund invests primarily in other affiliated funds, the Fund is a shareholder of those Underlying Funds. The Underlying Funds do not charge the Fund any sales charge for buying or selling shares. However, the Fund indirectly pays a portion of the operating expenses, including management fees of the Underlying Funds and short-term investments the Fund holds. These expenses are deducted from the Underlying Funds before their share prices are calculated and are in addition to the fees and expenses of the Fund. Actual indirect expenses vary depending on how the Fund’s assets are spread among the underlying investments.
4. Short-Term Trading Fees
The Fund reserves the right to assess a short-term trading fee on certain transactions out of Class VI shares that a separate account makes on behalf of a variable insurance contract owner (the “contract owner”). A separate account that redeems Class VI shares on behalf of a contract owner may be subject to a 1.00% short-term trading fee if the separate account held the Class VI shares on behalf of the contract owner for 60 days or less, unless an exception applies as disclosed in the Fund’s prospectus. The short-term trading fee is paid directly to the Fund and is intended to offset the cost to the Fund of excess brokerage commissions and other costs associated with fluctuations in Fund asset levels and cash flow caused by short-term trading. For purposes of determining whether the short-term trading fee applies, the Class VI shares that were held on behalf of the contract owner the longest will be treated as being redeemed first.
For the six months ended June 30, 2007, the Fund had contributions to capital due to collection of redemption fees in the amount of $1,547.
5. Investment Transactions
For the six months ended June 30, 2007, (excluding short-term securities) the Fund had purchases of $549,069,250 and sales of $477,384,139.
6. Bank Loans and Earnings Credit
The Trust has a credit agreement with JPMorgan Chase & Co., the Fund’s custodian bank, permitting the Trust to borrow up to $100,000,000. Borrowings under this arrangement bear interest at the Federal Funds rate plus 0.50%. The
The Trust’s custodian bank has agreed to reduce the bank’s fees (earnings credit) when the funds of the Trust maintain cash on deposit in non-interest-bearing custody and Demand Deposit Accounts. Earnings credits, if any, are shown as a reduction of total expenses on the Statement of Operations.
7. Portfolio Investment Risks
Risks Associated with Foreign Securities and Currencies. Investments in securities of foreign issuers carry certain risks not ordinarily associated with investments in securities of U.S. issuers. These risks include future political and economic developments, and the possible imposition of exchange controls or other foreign governmental laws and restrictions. In addition, with respect to certain countries, there is the possibility of expropriation of assets, confiscatory taxation, political or social instability, or diplomatic developments, which could adversely affect investments in those countries.
Certain countries also may impose substantial restrictions on investments in their capital markets by foreign entities, including restrictions on investments in issuers of industries deemed sensitive to relevant national interests. These factors may limit the investment opportunities available and result in a lack of liquidity and high price volatility with respect to securities of issuers from developing countries.
8. Indemnifications
Under the Trust’s organizational documents, certain of the Trust’s Officers and Trustees are indemnified against certain liabilities arising out of the performance of their duties to the Trust. In addition, the Trust has entered into Indemnification Agreements with the Trust’s trustees and certain officers covering similar liabilities. Trust Officers receive no compensation from the Trust for serving as the Trust’s Officers. In addition, in the normal course of business, the Trust enters into contracts with its vendors and others that provide for general indemnifications. The Trust’s maximum exposure under these arrangements is unknown, as this would involve future claims that may be made against the Trust. Based on experience, however, the Trust expects that risk of loss to be remote.
9. Recently Issued Accounting Pronouncements
On July 13, 2006, the Financial Accounting Standards Board (“FASB”) released FASB Interpretation No. 48, Accounting for Uncertainty in Income Taxes (“FIN 48”). FIN 48 provides guidance for how uncertain tax positions should be recognized, measured, presented and disclosed in the financial statements. FIN 48 requires the affirmative evaluation of tax positions taken or expected to be taken in the course of preparing the Fund’s tax returns to determine whether it is more-likely-than-not (i.e., greater than 50 percent) that each tax position will be sustained upon examination by a taxing authority based on the technical merits of the position. A tax position that meets the more-likely-than-not recognition threshold is measured to determine the amount of benefit to recognize in the financial statements. Differences between tax positions taken in a tax return and amounts recognized in the financial statements will generally result in an increase in a liability for taxes payable (or a reduction of a tax refund receivable) and an increase in a deferred tax liability (or a reduction in a deferred tax asset). Adoption of FIN 48 was required no later than the last business day of the first financial statement reporting period for fiscal years beginning after December 15, 2006 and is to be applied to all open tax years as of the effective date. Accordingly, the Fund was required to implement FIN 48 in its net asset value per share (NAV) calculation on June 29, 2007. Management has evaluated the implications of FIN 48 and has concluded that there was no impact to the Fund’s financial statements as of June 29, 2007. The adoption of FIN 48 requires ongoing monitoring and analysis, future conclusions reached by management may be different and result in adjustments to the Fund’s NAV and financial statements.
In September 2006, the FASB issued Statement on Financial Accounting Standards (“SFAS”) No. 157, “Fair Value Measurements.” This standard establishes a single authoritative definition of fair value, sets out a framework for
Trustees who are not Interested Persons (as defined in the 1940 Act) and Officers of the Trust as of
Number of Portfolios | ||||||||||
Position(s) Held | in the | |||||||||
with the Trust | Principal Occupation(s) | Nationwide Fund | Other | |||||||
Name, Address | and Length of | During Past | Complex Overseen | Directorships | ||||||
and Year of Birth | Time Served1 | Five Years | by Trustee | Held by Trustee2 | ||||||
Charles E. Allen c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1948 | Trustee since July 2000 | Mr. Allen is Chairman, Chief Executive Officer and President of Graimark Realty Advisors, Inc. (real estate development, investment and asset management). | 89 | None | ||||||
Paula H.J. Cholmondeley c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1947 | Trustee since July 2000 | Ms. Cholmondeley was Vice President and General Manager of Sappi Fine Paper North America from April 2000 through December 2003. | 89 | Director of Dentsply International, Inc. (dental products), Ultralife Batteries, Inc., Terex Corporation (construction equipment), Minerals Technology, Inc. (specialty chemicals) and Albany International Corp. (paper industry) | ||||||
C. Brent DeVore3 c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1940 | Trustee since 1990 | Dr. DeVore is President of Otterbein College. | 89 | None | ||||||
Phyllis Kay Dryden c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1947 | Trustee since December 2004 | Ms. Dryden was a partner of Mitchell Madison, a management consulting company from January 2006 until December 2006; she is currently a consultant with the company. Ms. Dryden was formerly Managing Partner of march FIRST, a global management consulting firm. | 89 | None | ||||||
Barbara L. Hennigar c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1935 | Trustee since July 2000 | Retired. | 89 | None |
Number of Portfolios | ||||||||||
Position(s) Held | in the | |||||||||
with the Trust | Principal Occupation(s) | Nationwide Fund | Other | |||||||
Name, Address | and Length of | During Past | Complex Overseen | Directorships | ||||||
and Year of Birth | Time Served1 | Five Years | by Trustee | Held by Trustee2 | ||||||
Barbara I. Jacobs c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1950 | Trustee since December 2004 | Ms. Jacobs served as Chairman of the Board of Directors of KICAP Network Fund, a European (United Kingdom) hedge fund, from January 2001 through January 2006. From 1998-2003, Ms. Jacobs was also a Managing Director and European Portfolio Manager of CREF Investments (Teachers Insurance and Annuity Association-College Retirement Equities Fund). | 89 | None | ||||||
Douglas F. Kridler c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1955 | Trustee since September 1997 | Mr. Kridler has served as the President and Chief Executive Officer of the Columbus Foundation (a Columbus, OH-based foundation which manages over 1,300 individual endowment funds) since February 2002. Prior to January 31, 2002, Mr. Kridler was the President of the Columbus Association for the Performing Arts and Chairman of the Greater Columbus Convention and Visitors Bureau. | 89 | None | ||||||
Michael D. McCarthy c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1947 | Trustee since December 2004 | Retired. Mr. McCarthy was Chairman of VMAC (commodity swaps) from October 2002 until January 2007; and a partner of Pineville Properties LLC (a commercial real estate development firm) from September 2000 until January 2007. | 89 | None | ||||||
David C. Wetmore c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1948 | Trustee since 1995 and Chairman since February 2005 | Retired. | 89 | None | ||||||
1 | Length of time served includes time served with the Trust’s predecessors. | |
2 | Directorships held in (1) any other investment companies registered under the 1940 Act, (2) any company with a class of securities registered pursuant to Section 12 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or (3) any company subject to the requirements of Section 15(d) of the Exchange Act. | |
3 | Mr. DeVore has served as President of Otterbein College since 1984. Mark Thresher, President and Chief Operating Officer of Nationwide Financial Services, Inc. (“NFS”) has served as a member of the Board of Trustees of Otterbein College since 2000, currently serves as one of 30 of its trustees, and is currently one of two Vice Chairmen of the Board. Each of Nationwide Fund Advisors (“NFA”), the Funds’ investment adviser, and Nationwide Fund Distributors LLC (“NFD”), principal underwriter to the Trust, is a wholly-owned subsidiary of NFS. | |
Additional information regarding the Trustees and Officers may be found in the Trust’s Statement of Additional Information, which is available without charge upon request, by calling 800-848-0920. |
Trustees who are Interested Persons (as defined in the 1940 Act) and/or Officers of the Trust as of
Number of Portfolios | ||||||||||
Position(s) Held | in the | |||||||||
with the Trust | Principal Occupation(s) | Nationwide Fund | Other | |||||||
Name, Address | and Length of | During Past | Complex Overseen | Directorships | ||||||
and Year of Birth | Time Served1 | 5 Years | by Trustee | Held by Trustee 2 | ||||||
Arden L. Shisler c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1941 | Trustee since February 2000 | Retired. Mr. Shisler is the former President and Chief Executive Officer of KeB Transport, Inc., a trucking firm (2000 through 2002). He served as a consultant to KeB from January 2003 through December 2004. Since 1992, Mr. Shisler has also been Chairman of the Board for Nationwide Mutual Insurance Company.3 | 89 | Director of Nationwide Financial Services, Inc., Chairman of Nationwide Mutual Insurance Company3 | ||||||
John H. Grady Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1961 | President & Chief Executive Officer since December 2006 | Mr. Grady is President, and Chief Executive Officer of Nationwide Funds Group which includes Nationwide Fund Advisors,3 Nationwide Fund Management LLC,3 Nationwide Fund Distributors LLC 3 and NWD Investments,2 the asset management operations of Nationwide Mutual Insurance Company, which includes Morley Capital Management, Inc.,2 Nationwide Separate Accounts LLC,2 NorthPointe Capital LLC,2 and Nationwide SA Capital Trust2. From March 2004 until March 2006, Mr. Grady was Chief Executive Officer of Constellation Investment Management Co., L.P. (registered investment adviser), and President and Chief Executive Officer of Constellation Funds Group (registered investment companies). He also was President of Constellation Investment Distribution Co., Inc. (registered broker-dealer) from March 2004 until June 2006. From February 2001 until February 2004, Mr. Grady was Chief Operating and Chief Legal Officer; Managing Director, Mutual Funds Group, Turner Investment Partners, Inc. (registered investment adviser); Executive Vice President of Turner Funds and Turner Institutional Portfolios (registered investment companies); and President, Turner Investment Distributors, Inc. (registered broker-dealer). | N/A | None | ||||||
Gerald J. Holland Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1951 | Treasurer since March 2001 | Mr. Holland is Senior Vice President—Operations for Nationwide Funds Group3. | N/A | N/A | ||||||
Number of Portfolios | ||||||||||
Position(s) Held | in the | |||||||||
with the Trust | Principal Occupation(s) | Nationwide Fund | Other | |||||||
Name, Address | and Length of | During Past | Complex Overseen | Directorships | ||||||
and Year of Birth | Time Served1 | 5 Years | by Trustee | Held by Trustee 2 | ||||||
Michael A. Krulikowski Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1959 | Chief Compliance Officer from June 2004 to August 20074 | Mr. Krulikowski is Vice President and Chief Compliance Officer of Nationwide Funds Group3, Morley Capital Management, Inc.3, Nationwide SA Capital Trust (since 1999)3, and Nationwide Separate Accounts LLC (since August 2005).3 Since June 2004, Mr. Krulikowski has also served as Chief Compliance Officer of the Trust. From November 1999 through May 2007, he served as Vice President and Chief Compliance Officer of NorthPointe Capital LLC. 3 | N/A | N/A | ||||||
Eric E. Miller Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1953 | Secretary since December 2002 | Mr. Miller is Senior Vice President, General Counsel, and Assistant Secretary for Nationwide Funds Group3 and NWD Investments.2 From August 2000 to August 2002, Mr. Miller was a Partner with Stradley Ronon Stevens & Young, LLP. | N/A | N/A | ||||||
1 | Length of time served includes time served with the Trust’s predecessors. | |
2 | Directorships held in (1) any other investment companies registered under the 1940 Act, (2) any company with a class of securities registered pursuant to Section 12 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or (3) any company subject to the requirements of Section 15(d) of the Exchange Act. | |
3 | This position is held with an affiliated person or principal underwriter of the Trust. | |
4 | Effective August 3, 2007, the Board of Trustees approved Carol Baldwin Moody as Chief Compliance Officer of the Trust. Since November 2005, Ms. Moody has been Senior Vice President, Chief Compliance Officer of Nationwide Financial Services, Nationwide Life Insurance Company, Nationwide Life and Annuity Insurance Company, and Nationwide Investment Advisors, LLC. From February 2004-November 2005, she was Chief Compliance Officer of TIAA-CREF and from April 2000-February 2004, she was Managing Director and General Counsel, TCW/ Latin America Partners, LLC and Baeza & Co., LLC. | |
Federal law requires the Trust, each of its investment advisers and sub-advisers to adopt procedures for voting proxies (“Proxy Voting Guidelines”) and to provide a summary of those Proxy Voting Guidelines used to vote the securities held by the Funds. The Funds’ proxy voting policies and procedures are available without charge (i) upon request, by calling 800-848-0920, (ii) on the Funds’ website at www.nationwidefunds.com, or (iii) on the Securities and Exchange Commission’s website at www.sec.gov. |
A. Renewal of Investment Advisory Agreement
(i) | General Information Regarding the Board’s Review of Investment Advisory Agreements |
The Trust’s investment advisory agreements (each an “Advisory Agreement”) with its investment adviser and, as applicable, sub-advisers (together, the “Adviser”) must be approved for an initial term no greater than two years, and renewed at least annually thereafter, (i) by the vote of the Trustees or by a vote of the shareholders of each series or fund of the Trust (individually a “Fund”), and (ii) by the vote of a majority of the Trustees who are not parties to the Advisory Agreement or “interested persons” of any party thereto (the “Independent Trustees”) cast in person at a meeting called for the purpose of voting on such approval.
The Board meets quarterly and takes into account throughout the year matters bearing on each Fund’s Advisory Agreement. The Board and its standing committees consider at each meeting factors that are relevant to the annual renewal of an Advisory Agreement, including the services and support provided to a Fund and its shareholders.
On December 6, 2006, the Independent Trustees first met in person with their independent legal counsel (“Independent Legal Counsel”) to consider information provided by the Adviser and others to assist the Trustees in considering whether to renew each Fund’s Advisory Agreement for a one year term beginning May 1, 2007. Immediately following such meeting of the Independent Trustees, all Trustees met in person with the Adviser, Trust counsel, Independent Legal Counsel and others to consider such matters, and give preliminary consideration to information bearing on continuation of each Advisory Agreement. The primary purpose of the December 6 and 7, 2006 meeting was to ensure that the Trustees had ample opportunity to consider matters they deemed relevant in considering the continuation of an Advisory Agreement, and to request any additional information they considered reasonably necessary to their deliberations.
In preparation for the December 6 and 7, 2006 meeting the Trustees were provided, at the request of the Trustees, with a wide range of information to assist in their deliberations, including (i) reports from Lipper Inc. describing a Fund’s (a) performance rankings (where “first quintile” denotes the best performance) (over multiple years ended September 30, 2006) compared with performance groups and performance universes created by Lipper (and in some cases, customized peer groups created by the Adviser) of similar or peer group funds, and (b) expense rankings (where “first quintile” denotes the lowest fees and expenses) comparing the Fund’s contractual advisory fee and total expenses with expense groups and expense universes created by Lipper of similar or peer group funds, (ii) information from the Adviser describing the Fund’s performance (over multiple years ended September 30, 2006) compared with its benchmark and Lipper categories, (iii) for Funds under “close review,” copies of letters from the Adviser to the portfolio manager of each such Fund, together with the portfolio manager’s written response describing the reasons for the Fund’s underperformance (iv) information from the Adviser describing performance for the months of October and November, 2006, and annual performance for the year ended November 30, 2006, (v) reports from the Adviser describing the Adviser’s profitability in providing services under an Advisory Agreement, together with an explanation of Adviser’s methodology in calculating its profitability, (vi) information from the Adviser describing any fees paid to the Adviser for managing similar, non-affiliated institutional accounts, including the range of fee levels for such accounts, and (vii) information from the Adviser describing ancillary benefits, in addition to fees for serving as investment adviser, derived by the Adviser as a result of being investment adviser for a Fund, including, where applicable, information on soft-dollar benefits and fees inuring to the Adviser’s affiliates for serving as the Trust’s administrator, fund accountant and transfer agent.
At the December 6 and 7, 2006 meeting, the Trustees reviewed, considered and discussed, among themselves and with the Adviser, Trust counsel and Independent Legal Counsel, among other things, the information described above, and: (i) the nature, extent and quality of services provided by the Adviser under each Advisory Agreement, (ii) the investment performance of each Fund and the Adviser, (iii) the costs of the services provided by the Adviser under the Advisory Agreement and the profits realized by the Adviser thereunder, (iv) the extent to which economies of scale may be present and, if so, whether they are being shared with a Fund’s shareholders, (v) comparisons of the Adviser’s fees under the Advisory Agreement with investment advisory fees paid by peer group funds to their investment advisers and paid by non-affiliated institutional clients to the Adviser for managing similar accounts, and (vi) any ancillary benefits inuring to the Adviser and its affiliates as a result of being investment adviser for the Trust. The Trustees also considered, where
As part of the December 6 and 7, 2006 Board meeting, the Independent Trustees developed a list of follow-up matters and questions and asked that Adviser respond to such matters and questions at the contract approval meeting of the Board of Trustees to be held on January 11, 2007.
At the January 11, 2007 meeting of the Board of Trustees of the Trust, the Board received and considered information provided by the Adviser in follow-up from the December 6 and 7, 2006 Board meeting and, after consulting among themselves, and with the Adviser, Trust counsel and Independent Legal Counsel, concluded unanimously to renew the Advisory Agreement for the reasons set forth in the following section. In determining whether to renew the Advisory Agreement for the Fund, the Board ultimately reached a determination, with the assistance of Trust counsel and Independent Legal Counsel, that the renewal of the Advisory Agreement and the compensation to be received by the Adviser under the Advisory Agreement is consistent with the Board’s fiduciary duty under applicable law.
(ii) | Board Conclusions Regarding the Fund’s Advisory Agreement |
The Board considered that the Fund had underperformed its secondary benchmark (which is a more appropriate indicator of performance than the Fund’s primary benchmark) for the one-year period and outperformed its secondary benchmark for the three- year period. The Board also considered that the Fund’s portfolio manager had changed during 2006 and considered the services provided by the adviser to the Fund that are in addition to the advisory services that are provided to the underlying funds. Based on its review, and giving particular weight to the nature and quality of the resources dedicated by the adviser to maintain relative performance, the Board concluded that the nature, extent, and quality of the services provided to the Fund will benefit the Fund’s shareholders.
The Board also considered that the Fund’s contractual advisory fee and breakpoints placed the Fund in the fourth quintile of its Lipper-constructed Expense Group and the Fund’s total expenses placed the Fund in the second quintile. The Board considered that total expenses were relatively low, and the advisory fee should be consistent among all of the Investor Destination Funds offered by the Trust. The Board concluded that the Fund’s management fee and total expenses were fair and reasonable in light of the services that the Fund receives and the other factors considered.
The Board considered that the Fund’s adviser reported a pre-tax profit margin for investment management services during each of the twelve month-periods ended September 30, 2006 and 2005. The Board considered the costs of the services provided by and the profits realized by the adviser in connection with the operation of the Fund and determined that the amount of profit is a fair entrepreneurial profit for the management of the Fund.
Based upon its evaluation of all of the conclusions noted above, and after considering all material factors with respect to the Fund, the Board ultimately concluded that the advisory fee structure is fair and reasonable, and that the Advisory Agreement (and, if applicable, Sub-Advisory Agreement) with respect to the Fund, should be renewed.
B. Approval of New Advisory Agreement
At its January 11, 2007 meeting, the Board also unanimously approved a new investment advisory agreement (the “New Agreement”) for the Fund with Nationwide Fund Advisors, (“NFA”) the then-current adviser to each of the series of the Trust to become effective upon the closing of the acquisition of NFA by Nationwide Financial Services, Inc. (“NFS”) from Nationwide Corporation (“NWC”) which closed on April 30, 2007 (the “Transaction”). In approving the New Agreement, the Board considered NFA’s capacity to continue to provide the services needed to operate a sophisticated investment management business and to support the management of each of the series. The Board also took into account the information provided to them at their regular quarterly meetings with NFA’s senior management with respect to the Fund, including the information provided by management at the Fund’s annual Section 15(c) meetings on December 6-7, 2006 and January 11, 2007. In addition, the Board also considered NFS’ announced intentions, over time, that NFA
C. Submission of Matters to a Vote of Security Holders:
On April 25, 2007, a Special Meeting of Shareholders was held* (the “April 25 Meeting”) at which shareholders of the Funds** set forth below were asked:
Proposal 1:
To approve a new investment advisory agreement, on behalf of their Fund, between Nationwide Fund Advisors (formerly “Gartmore Mutual Fund Capital Trust”) (the “Adviser”) and Nationwide Variable Insurance Trust (formerly “Gartmore Variable Insurance Trust”) (the “Trust”).
Number of Shares | ||||
Fund | Cast/Not Cast | Percentages | ||
Federated NVIT High Income Bond Fund (Formerly Federated GVIT High Income Bond Fund) | FOR 30,051,703.188 shares AGAINST 618,245.021 shares ABSTAIN 1,813,550.431 shares TOTAL 32,483,498.640 shares | 92.514% 1.903% 5.583% | ||
NVIT International Index Fund (Formerly GVIT International Index Fund) | FOR 4,322,203.982 shares AGAINST 2,758.318 shares ABSTAIN 135,636.840 shares TOTAL 4,460,599.140 shares | 96.897% 0.062% 3.041% | ||
NVIT International Value Fund (Formerly GVIT International Value Fund) | FOR 20,032,843.199 shares AGAINST 333,588.902 shares ABSTAIN 1,093,293.879 shares TOTAL 21,459,725.980 shares | 93.351% 1.554% 5.095% | ||
NVIT Mid Cap Index Fund (Formerly GVIT Mid Cap Index Fund) | FOR 35,380,179.120 shares AGAINST 631,117.844 shares ABSTAIN 1,565,714.306 shares TOTAL 37,577,011.270 shares | 94.154% 1.679% 4.167% | ||
NVIT S&P 500 Index Fund (Formerly GVIT S&P 500 Index Fund) | FOR 56,119,814.230 shares AGAINST 666,195.542 shares ABSTAIN 1,944,898.888 shares TOTAL 58,730,908.660 shares | 95.554% 1.134% 3.312% |
Number of Shares | ||||
Fund | Cast/Not Cast | Percentages | ||
Nationwide Multi-Manager NVIT Small Cap Growth Fund (Formerly GVIT Small Cap Growth Fund) | FOR 7,632,918.513 shares AGAINST 149,458.111 shares ABSTAIN 451,583.036 shares TOTAL 8,233,959.660 shares | 92.700% 1.816% 5.484% | ||
Nationwide Multi-Manager NVIT Small Cap Value Fund (Formerly GVIT Small Cap Value Fund) | FOR 48,649,396.525 shares AGAINST 979,183.753 shares ABSTAIN 2,786,133.102 shares TOTAL 52,414,713.380 shares | 92.816% 1.868% 5.316% | ||
Nationwide Multi-Manager NVIT Small Company Fund (Formerly GVIT Small Company Fund) | FOR 29,903,181.700 shares AGAINST 838,774.923 shares ABSTAIN 2,006,741.307 shares TOTAL 32,748,697.930 shares | 91.311% 2.561% 6.128% | ||
Gartmore NVIT Developing Markets Fund (Formerly Gartmore GVIT Developing Markets Fund) | FOR 21,0177,889.443 shares AGAINST 424,272.958 shares ABSTAIN 1,543,850.729 shares TOTAL 23,046,013.130 shares | 91.460% 1.841% 6.699% | ||
Gartmore NVIT Emerging Markets Fund (Formerly Gartmore GVIT Emerging Markets Fund) | FOR 17,050,534.593 shares AGAINST 526,574.722 shares ABSTAIN 881,608.905 shares TOTAL 18,458,718.220 shares | 92.371% 2.853% 4.776% | ||
Nationwide NVIT Global Financial Services Fund (Formerly Gartmore GVIT Global Financial Services Fund) | FOR 1,554,847.333 shares AGAINST 19,539.033 shares ABSTAIN 52,206.494 shares TOTAL 1,626,592.860 shares | 95.589% 1.201% 3.210% | ||
Nationwide NVIT Global Health Sciences Fund (Formerly Gartmore GVIT Global Health Sciences Fund) | FOR 4,722,963.678 shares AGAINST 157,979.030 shares ABSTAIN 207,642.222 shares TOTAL 5,088,584.930 shares | 92.815% 3.104% 4.081% | ||
Nationwide NVIT Global Technology and Communications Fund (Formerly Gartmore GVIT Global Technology and Communications Fund) | FOR 8,585,472.039 shares AGAINST 102,267.977 shares ABSTAIN 489,577.634 shares TOTAL 9,177,317.650 shares | 93.551% 1.114% 5.335% | ||
Gartmore NVIT Global Utilities Fund (Formerly Gartmore GVIT Global Utilities Fund) | FOR 4,123,270.549 shares AGAINST 122,001.533 shares ABSTAIN 240,276.088 shares TOTAL ��4,485,548.170 shares | 91.923% 2.720% 5.357% | ||
Nationwide NVIT Government Bond Fund (Formerly Gartmore GVIT Government Bond Fund) | FOR 88,471,567.462 shares AGAINST 1,825,645.181 shares ABSTAIN 5,841,990.727 shares TOTAL 96,139,203.370 shares | 92.024% 1.899% 6.077% |
Number of Shares | ||||
Fund | Cast/Not Cast | Percentages | ||
Nationwide NVIT Growth Fund (Formerly Gartmore GVIT Growth Fund) | FOR 14,931,435.904 shares AGAINST 409,826.402 shares ABSTAIN 1,259,945.064 shares TOTAL 16,601,207.370 shares | 89.942% 2.469% 7.589% | ||
Gartmore NVIT International Growth Fund (Formerly Gartmore GVIT International Growth Fund) | FOR 6,251,419.070 shares AGAINST 139,618.548 shares ABSTAIN 290,025.592 shares TOTAL 6,681,063.210 shares | 93.569% 2.090% 4.341% | ||
Nationwide NVIT Investor Destinations Aggressive Fund (Formerly Gartmore GVIT Investor Destinations Aggressive Fund) | FOR 49,489,224.549 shares AGAINST 1,385,396.474 shares ABSTAIN 3,696,272.337 shares TOTAL 54,570,893.360 shares | 90.688% 2.539% 6.773% | ||
Nationwide NVIT Investor Destinations Conservative Fund (Formerly Gartmore GVIT Investor Destinations Conservative Fund) | FOR 23,091,965.887 shares AGAINST 314,935,884 shares ABSTAIN 2,292,355.179 shares TOTAL 25,699,256.950 shares | 89.855% 1.225% 8.920% | ||
Nationwide NVIT Investor Destinations Moderate Fund (Formerly Gartmore GVIT Investor Destinations Moderate Fund) | FOR 188,902,093.059 shares AGAINST 3,018,924.590 shares ABSTAIN 16,359,690.401 shares TOTAL 208,280,708.050 shares | 90.696% 1.449% 7.855% | ||
Nationwide NVIT Investor Destinations Moderately Aggressive Fund (Formerly Gartmore GVIT Investor Destinations Moderately Aggressive Fund) | FOR 134,792,622.920 shares AGAINST 3,489,207.264 shares ABSTAIN 9,304,197.656 shares TOTAL 147,586,027.840 shares | 91.332% 2.364% 6.304% | ||
Nationwide NVIT Investor Destinations Moderately Conservative Fund (Formerly Gartmore GVIT Investor Destinations Moderately Conservative Fund) | FOR 49,627,123.216 shares AGAINST 856,088.634 shares ABSTAIN 3,507,215.650 shares TOTAL 53,990,427.500 shares | 91.918% 1.586% 6.496% | ||
Nationwide NVIT Mid Cap Growth Fund (Formerly Gartmore GVIT Mid Cap Growth Fund) | FOR 10,879,584.971 shares AGAINST 352,594.958 shares ABSTAIN 717,792.971 shares TOTAL 11,949,972.900 shares | 91.043% 2.950% 6.007% | ||
Nationwide NVIT Money Market Fund II (Formerly Gartmore GVIT Money Market Fund II) | FOR 221,774,863.241 shares AGAINST 12,322,482.494 shares ABSTAIN 16,471,740.875 shares TOTAL 250,569,086.610 shares | 88.508% 4.918% 6.574% |
Number of Shares | ||||
Fund | Cast/Not Cast | Percentages | ||
Nationwide NVIT Money Market Fund (Formerly Gartmore GVIT Money Market Fund) | FOR 1,578,331,008.328 shares AGAINST 32,372,133.671 shares ABSTAIN 112,652,123.301 shares TOTAL 1,723,355,265.300 shares | 91.585% 1.878% 6.537% | ||
NVIT Nationwide Fund (Formerly Gartmore GVIT Nationwide Fund) | FOR 125,423,274.735 shares AGAINST 2,767,979.467 shares ABSTAIN 8,762,255.828 shares TOTAL 136,953,510.030 shares | 91.581% 2.021% 6.398% | ||
NVIT Nationwide Leaders Fund (Formerly Gartmore GVIT Nationwide Leaders Fund) | FOR 2,298,504.956 shares AGAINST 29,630.469 shares ABSTAIN 71,637.755 shares TOTAL 2,399,773.180 shares | 95.780% 1.235% 2.985% | ||
Nationwide NVIT U.S. Growth Leaders Fund (Formerly Gartmore GVIT U.S. Growth Leaders Fund) | FOR 4,972,094.773 shares AGAINST 122,623.161 shares ABSTAIN 174,625.606 shares TOTAL 5,269,343.540 shares | 94.359% 2.327% 3.314% | ||
Gartmore NVIT Worldwide Leaders Fund (Formerly Gartmore GVIT Worldwide Leaders Fund) | FOR 2,666,862.487 shares AGAINST 47,702.491 shares ABSTAIN 118,719.882 shares TOTAL 2,833,284.860 shares | 94.126% 1.684% 4.190% | ||
J.P. Morgan NVIT Balanced Fund (Formerly J.P. Morgan GVIT Balanced Fund) | FOR 15,966,867.546 shares AGAINST 259,004.324 shares ABSTAIN 1,339,385.200 shares TOTAL 17,565,257.070 shares | 90.900% 1.475% 7.625% | ||
Van Kampen NVIT Comstock Value Fund (Formerly Van Kampen GVIT Comstock Value Fund) | FOR 27,737,008.009 shares AGAINST 502,564.164 shares ABSTAIN 1,824,670.107 shares TOTAL 30,064,242.280 shares | 92.259% 1.672% 6.069% | ||
Van Kampen NVIT Multi Sector Bond Fund (Formerly Van Kampen GVIT Multi Sector Bond Fund) | FOR 21,253,297.665 shares AGAINST 484,100.920 shares ABSTAIN 1,803,963.645 shares TOTAL 23,541,362.230 shares | 90.281% 2.056% 7.663% | ||
At the April 25 Meeting, shareholders of the Nationwide NVIT Mid Cap Growth Fund were also asked to approve a new investment subadvisory agreement among the Adviser, the Trust and NorthPointe Capital LLC. The voting results with respect to that proposal are set forth below:
Proposal 2
Number of Shares | ||||
Fund | Cast/Not Cast | Percentages | ||
Nationwide NVIT Mid Cap Growth Fund (Formerly Gartmore GVIT Mid Cap Growth Fund) | FOR 10,862,827.499 shares AGAINST 414,574.660 shares ABSTAIN 672,570.741 shares TOTAL 11,949,972.900 shares | 90.903% 3.469% 5.628% | ||
* | This meeting was previously adjourned on April 23, 2007. | |
** | Fund names were changed effective May 1, 2007 to reflect “Nationwide”/ “NVIT” branding to coincide with the sale of Nationwide Fund Advisors, Inc. by Nationwide Corporation to its majority-owned subsidiary, Nationwide Financial Services, Inc. |
June 30, 2007 (Unaudited)
Contents | ||
6 | Statement of Investments | |
7 | Statement of Assets and Liabilities | |
8 | Statement of Operations | |
9 | Statements of Changes in Net Assets | |
11 | Financial Highlights | |
12 | Notes to Financial Statements |
Statement Regarding Availability of Proxy Voting Record.
SAR-IDC (8/07) | ![]() |
Dear Fellow Shareholder:
Since I last wrote to you, our mutual funds have enjoyed another period of solid performance, and the corporate realignment that was in progress is now finished.
On May 1, 2007, Nationwide Financial Services, Inc. (NFS), completed its acquisition of the Philadelphia-based retail mutual fund operations of NWD Investment Management, Inc. (formerly, “Gartmore Global Investments, Inc.”), from Nationwide Corporation, a subsidiary of Nationwide Mutual Insurance Company. Effective that date, the acquired entities were renamed Nationwide Funds Group (NFG), and the Gartmore Funds were renamed the Nationwide Funds to better align with the Nationwide® brand. Although the corporate ownership and fund names have changed, I can assure you that NFG intends to maintain as much continuity as possible with the Funds and key personnel.
Thank you, shareholders, for approving the new investment advisory agreement that was required due to the change in corporate ownership. The new agreement is identical in all material respects to the original agreement that it replaces, with the exception of the section pertaining to the vote by the shareholders of the NVIT Mid Cap Growth Fund to approve NorthPointe Capital®, LLC (NorthPointe) as sub-adviser to that particular Fund.
Market Overview: January 1-June 30, 2007
Share prices in general were buoyed in part by better-than-expected first-quarter 2007 earnings and a flurry of mergers and acquisitions, many of these spurred by readily available funding from private equity firms. In June, investors grew more cautious amid surging crude oil prices, a sudden spike in long-term interest rates, and the meltdown of two hedge funds that had exposure to the subprime mortgage market. Looking abroad, a weak U.S. dollar aided foreign stocks, as reflected in the 11.09% advance of the Morgan Stanley Capital International Europe, Australasia and Far East (MSCI EAFE®) Index. Emerging market performance was particularly robust.
The bond market struggled during the first half of 2007. While short-term interest rates remained stable, reflecting the Federal Reserve Board’s decision in June to leave the target federal funds rate at 5.25%, longer-term rates climbed during the first half of 2007, depressing bond prices and forcing the Lehman Brothers® U.S. Aggregate Index to settle for a modest 0.97% return.
We at NFG thank you for your understanding and cooperation throughout our recent transition period. We emerge from this period energized for the future, and we look forward to serving your investment needs for a long time to come.
Nationwide Funds Group
PAST PERFORMANCE IS NO GUARANTEE OF FUTURE RESULTS.
Nationwide Funds are advised by Nationwide Fund Advisors (NFA). NFA is a wholly-owned subsidiary of Nationwide Financial Services. Nationwide Financial Services is a wholly-owned subsidiary of Nationwide Corporation. All of the common stock of Nationwide Corporation is held by Nationwide Mutual (95.2%) and Nationwide Mutual Fire Insurance Company (4.8%), each of which is a mutual company owned by its policyholders.
Nationwide Funds Group (NFG) is the mutual fund arm of Nationwide Financial Services (NYSE: NFS). Based in Conshohocken, Pa., a suburb of Philadelphia, NFG is comprised of Nationwide Fund Advisors, Nationwide Fund Distributors, LLC, and Nationwide Fund Management, LLC. Together, these provide advisory, distribution, and administration services respectively to the Nationwide Funds, and manage more than $43.5 billion in assets as of June 30, 2007, of which more than $12 billion are in “fund of funds” designed to provide asset allocation across several types of investments and asset classes.
Lehman Brothers (LB) U.S. Aggregate Index: An unmanaged, market value-weighted index of investment-grade, fixed-rate debt issues (including government, corporate, asset-backed, and mortgage-backed securities with maturities of one year or more) that is generally representative of the bond market as a whole.
Morgan Stanley Capital International Europe, Australasia and Far East (MSCI EAFE®) Index: An unmanaged, free float-adjusted, market capitalization-weighted index that is designed to measure the performance of stocks in developed markets outside the United States and Canada.
Standard & Poor’s 500® (S&P 500) Index: An unmanaged, market capitalization-weighted index of 500 widely held stocks of large-cap U.S. companies that gives a broad look at how the stock prices of those companies have performed.
Views expressed within are those of Nationwide Funds Group as of the date noted, are subject to change at any time, and may not come to pass.
This report is for informational purposes only, and is not intended as an offer or recommendation with respect to the purchase or sale of any security, option, future, or other derivatives in such securities.
Investing in mutual funds involves risk, including possible loss of principal.
Investors should carefully consider a fund’s investment objectives, risks, fees, charges, and expenses before investing any money. To obtain this and other fund information, please call 800-848-0920 to request a prospectus, or download a prospectus at www.nationwidefunds.com. Please read the prospectus carefully before investing any money.
Nationwide Funds distributed by Nationwide Fund Distributors LLC (formerly Gartmore Distribution Services, Inc.), Member NASD. 1200 River Road, Suite 1000, Conshohocken, Pa. 19428.
Shareholder | Nationwide NVIT Investor Destinations |
As a shareholder of the Fund, you incur two types of costs: (1) transaction costs, including sales charges (loads) paid on purchase payments and redemption fees; and (2) ongoing costs, including investment advisory fees, administration fees, distribution fees and other Fund expenses. The examples below are 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. Per SEC requirements, the examples assume that you had a $1,000 investment in the Class at the beginning of the reporting period, January 1, 2007, and continued to hold your shares at the end of the reporting period, June 30, 2007.
Actual Expenses
Hypothetical Example for Comparison Purposes
Please note that the expenses shown in the table are meant to highlight your ongoing costs only and do not reflect any transaction costs, such as sales charges (loads) or redemption fees. Therefore, the second line for each Class in 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 transaction costs were included, your costs would have been higher. The examples also assume all dividends and distributions have been reinvested.
Schedule of Shareholder Expenses
Nationwide NVIT Investor Destinations | ||||||||||||||||||||||
Conservative Fund | ||||||||||||||||||||||
Beginning | Ending | Expenses Paid | Annualized | |||||||||||||||||||
Account Value, | Account | During | Expense | |||||||||||||||||||
January 1, 2007 | Value, | Period*2 | Ratio*2 | |||||||||||||||||||
June 30, 2007 | ||||||||||||||||||||||
Class II | Actual | $ | 1,000.00 | $ | 1,027.20 | $ | 2.76 | 0.55% | ||||||||||||||
Hypothetical | 1 | $ | 1,000.00 | $ | 1,022.07 | $ | 2.76 | 0.55% | ||||||||||||||
Class VI | Actual | $ | 1,000.00 | $ | 1,027.10 | $ | 2.81 | 0.56% | ||||||||||||||
Hypothetical | 1 | $ | 1,000.00 | $ | 1,022.02 | $ | 2.81 | 0.56% | ||||||||||||||
* | Expenses are equal to the Fund’s annualized expense ratio multiplied by the average account value over the period multiplied by 181/365 (to reflect the one-half year period). The expense ratio presented represents a six-month, annualized ratio in accordance with SEC guidelines. The expenses reported above do not include the effect of additional expenses imposed by variable annuity contracts. | |
1 | Represents the hypothetical 5% return before expenses. | |
2 | Expenses are based on the direct expenses of the Fund and do not include the effect of the underlying Funds’ expenses, which are disclosed in the Fee and Expense table and described more fully in a footnote to that table in your Fund prospectus. |
Portfolio Summary | Nationwide NVIT Investor Destinations Conservative Fund |
Asset Allocation | ||||
Mutual Funds | 79.7% | |||
Fixed Contract | 20.4% | |||
Liabilities in excess of other assets | -0.1% | |||
100.0% |
Asset Allocation Detail | ||||
Fixed Income Funds | 54.7% | |||
Equity Funds | 20.0% | |||
Money Market Funds | 5.0% | |||
Fixed Contract | 20.4% | |||
Other | -0.1% | |||
100.0% |
Top Holdings | ||||
Nationwide NVIT Bond Index Fund, ID Class | 40.1% | |||
Nationwide Fixed Contract, 3.95% | 20.4% | |||
Nationwide NVIT Enhanced Income Fund, ID Class | 14.6% | |||
NVIT S&P 500 Index Fund, ID Class | 10.0% | |||
NVIT Money Market Fund, ID Class | 5.0% | |||
NVIT Mid Cap Index Fund, ID Class | 5.0% | |||
NVIT International Index Fund, ID Class | 3.2% | |||
Nationwide International Index Fund, Institutional Class | 1.8% | |||
Other | -0.1% | |||
100.0% |
Nationwide NVIT Investor Destinations Conservative Fund
MUTUAL FUNDS (79.7%)(a) | ||||||||
Shares or | ||||||||
Principal Amount | Value | |||||||
Equity Funds (20.0%) | ||||||||
Nationwide International Index Fund, Institutional Class | 472,187 | $ | 5,609,576 | |||||
NVIT International Index Fund, ID Class | 821,543 | 9,694,204 | ||||||
NVIT Mid Cap Index Fund, ID Class | 756,374 | 15,157,741 | ||||||
NVIT S&P 500 Index Fund, ID Class | 2,897,152 | 30,333,177 | ||||||
Fixed Income Funds (54.7%) | ||||||||
Nationwide NVIT Bond Index Fund, ID Class | 12,417,209 | 122,061,167 | ||||||
Nationwide NVIT Enhanced Income Fund, ID Class | 4,440,349 | 44,403,489 | ||||||
Money Market Funds (5.0%) | ||||||||
NVIT Money Market Fund, ID Class | 15,195,560 | 15,195,560 | ||||||
Total Mutual Funds (Cost $240,588,243) | 242,454,914 | |||||||
FIXED CONTRACT (20.4%)(a) (b) | ||||||||
Shares or | ||||||||
Principal Amount | Value | |||||||
Nationwide Fixed Contract, 3.95% | $ | 61,972,062 | $ | 61,972,062 | ||||
Total Investments (Cost $302,560,305) (c) — 100.1% | 304,426,976 | |||||||
Liabilities in excess of other assets — (0.1)% | (155,228 | ) | ||||||
NET ASSETS — 100.0% | $ | 304,271,748 | ||||||
(a) | Investment in affiliate. | |
(b) | The Nationwide Fixed Contract rate changes quarterly. The security is restricted and as the affiliated counterparty is required by contract to redeem within five days upon request, it has been deemed liquid pursuant to procedures approved by the Board of Trustees. | |
(c) | See notes to financial statements for tax unrealized appreciation (depreciation) of securities. |
See accompanying notes to financial statements.
Nationwide NVIT | ||||||
Investor Destinations | ||||||
Conservative Fund | ||||||
Assets: | ||||||
Investments in affiliates, at value (cost $302,560,305) | $ | 304,426,976 | ||||
Cash | 193 | |||||
Interest and dividends receivable | 63,343 | |||||
Receivable for capital shares issued | 27,863 | |||||
Prepaid expenses | 3,852 | |||||
Total Assets | 304,522,227 | |||||
Liabilities: | ||||||
Payable for capital shares redeemed | 101,881 | |||||
Accrued expenses and other payables: | ||||||
Investment advisory fees | 32,446 | |||||
Distribution fees | 62,398 | |||||
Administrative servicing fees | 17,471 | |||||
Compliance program costs | 4,123 | |||||
Other | 32,160 | |||||
Total Liabilities | 250,479 | |||||
Net Assets | $ | 304,271,748 | ||||
Represented by: | ||||||
Capital | $ | 296,873,005 | ||||
Accumulated net investment income | 60,075 | |||||
Accumulated net realized gains from investment transactions | 5,471,997 | |||||
Net unrealized appreciation on investments | 1,866,671 | |||||
Net Assets | $ | 304,271,748 | ||||
Net Assets: | ||||||
Class II Shares | $ | 299,111,741 | ||||
Class VI Shares | 5,160,007 | |||||
Total | $ | 304,271,748 | ||||
Shares outstanding (unlimited number of shares authorized): | ||||||
Class II Shares | 28,992,722 | |||||
Class VI Shares | 502,040 | |||||
Total | 29,494,762 | |||||
Net asset value and offering price per share (Net assets by class divided by shares outstanding by class, respectively.):* | ||||||
Class II Shares | $ | 10.32 | ||||
Class VI Shares | $ | 10.28 | ||||
* | Not subject to a front-end sales charge. |
7
Nationwide NVIT | |||||
Investor Destinations | |||||
Conservative Fund | |||||
INVESTMENT INCOME: | |||||
Interest income from affiliates | $ | 1,287,222 | |||
Dividend income from affiliates | 4,849,932 | ||||
Total Income | 6,137,154 | ||||
Expenses: | |||||
Investment advisory fees | 198,885 | ||||
Distribution fees Class II Shares | 376,585 | ||||
Distribution fees Class VI Shares | 5,890 | ||||
Administrative servicing fees Class II Shares | 204,421 | ||||
Administrative servicing fees Class VI Shares | 3,482 | ||||
Trustee fees | 7,074 | ||||
Compliance program costs (Note 3) | 2,167 | ||||
Other | 42,454 | ||||
Total expenses before earnings credit | 840,958 | ||||
Earnings credit (Note 6) | (101 | ) | |||
Net Expenses | 840,857 | ||||
Net Investment Income | 5,296,297 | ||||
REALIZED/ UNREALIZED GAINS (LOSSES) FROM INVESTMENTS: | |||||
Realized gains on investment transactions with affiliates | 7,253,128 | ||||
Realized gain distributions from underlying funds | 893,264 | ||||
Net realized gains on investment transactions | 8,146,392 | ||||
Net change in unrealized depreciation on investments | (4,979,877 | ) | |||
Net realized/unrealized gains (losses) on investments | 3,166,515 | ||||
CHANGE IN NET ASSETS RESULTING FROM OPERATIONS | $ | 8,462,812 | |||
8
Nationwide NVIT Investor | |||||||||
Destinations Conservative Fund | |||||||||
Six Months Ended | Year Ended | ||||||||
June 30, 2007 | December 31, 2006 | ||||||||
(Unaudited) | |||||||||
FROM INVESTMENT ACTIVITIES: | |||||||||
Operations: | |||||||||
Net investment income | $ | 5,296,297 | $ | 9,414,168 | |||||
Net realized gains on investment transactions | 8,146,392 | 5,936,728 | |||||||
Net change in unrealized appreciation/depreciation on investment transactions | (4,979,877 | ) | 2,833,228 | ||||||
Change in net assets resulting from operations | 8,462,812 | 18,184,124 | |||||||
Distributions to shareholders from: | |||||||||
Net investment income: | |||||||||
Class II | (5,223,572 | ) | (9,362,448 | ) | |||||
Class VI | (88,144 | ) | (183,662 | ) | |||||
Net realized gains on investments: | |||||||||
Class II | (7,040,572 | ) | (3,126,505 | ) | |||||
Class VI | (122,000 | ) | (56,609 | ) | |||||
Change in net assets from shareholder distributions | (12,474,288 | ) | (12,729,224 | ) | |||||
Change in net assets from capital transactions | (2,268,770 | ) | 20,121,133 | ||||||
Change in net assets | (6,280,246 | ) | 25,576,033 | ||||||
Net Assets: | |||||||||
Beginning of period | 310,551,994 | 284,975,961 | |||||||
End of period | $ | 304,271,748 | $ | 310,551,994 | |||||
Accumulated net investment income at end of period | $ | 60,075 | $ | 75,494 | |||||
CAPITAL TRANSACTIONS: | |||||||||
Class II Shares | |||||||||
Proceeds from shares issued | $ | 33,294,548 | $ | 103,068,728 | |||||
Dividends reinvested | 12,264,082 | 12,488,923 | |||||||
Cost of shares redeemed (a) | (47,129,300 | ) | (96,645,803 | ) | |||||
(1,570,670 | ) | 18,911,848 | |||||||
Class VI Shares | |||||||||
Proceeds from shares issued | 1,238,082 | 5,171,391 | |||||||
Dividends reinvested | 210,142 | 240,271 | |||||||
Cost of shares redeemed (a) | (2,146,324 | ) | (4,202,377 | ) | |||||
(698,100 | ) | 1,209,285 | |||||||
Change in net assets from capital transactions | $ | (2,268,770 | ) | $ | 20,121,133 | ||||
SHARE TRANSACTIONS: | |||||||||
Class II Shares | |||||||||
Issued | 3,147,025 | 9,975,165 | |||||||
Reinvested | 1,184,293 | 1,217,177 | |||||||
Redeemed | (4,447,543 | ) | (9,378,104 | ) | |||||
(116,225 | ) | 1,814,238 | |||||||
9
Nationwide NVIT Investor | |||||||||
Destinations Conservative Fund | |||||||||
Six Months Ended | Year Ended | ||||||||
June 30, 2007 | December 31, 2006 | ||||||||
(Unaudited) | |||||||||
SHARE TRANSACTIONS: (continued) | |||||||||
Class VI Shares | |||||||||
Issued | 117,294 | 499,380 | |||||||
Reinvested | 20,378 | 23,454 | |||||||
Redeemed | (205,073 | ) | (406,223 | ) | |||||
(67,401 | ) | 116,611 | |||||||
Total change in shares | (183,626 | ) | 1,930,849 | ||||||
(a) | Includes redemption fees, if any. |
10
Distributions | ||||||||||||||||||||
Investment Activities | ||||||||||||||||||||
Net Realized | ||||||||||||||||||||
and | ||||||||||||||||||||
Net Asset | Unrealized | Total | ||||||||||||||||||
Value, | Net | Gains | from | Net | ||||||||||||||||
Beginning | Investment | (Losses) on | Investment | Investment | ||||||||||||||||
of Period | Income | Investments | Activities | Income | ||||||||||||||||
Class II Shares | ||||||||||||||||||||
For the year ended December 31, 2002 | $ | 10.01 | 0.21 | (0.18 | ) | 0.03 | (0.21 | ) | ||||||||||||
For the year ended December 31, 2003 | $ | 9.83 | 0.24 | 0.53 | 0.77 | (0.24 | ) | |||||||||||||
For the year ended December 31, 2004 (f) | $ | 10.32 | 0.24 | 0.23 | 0.47 | (0.24 | ) | |||||||||||||
For the year ended December 31, 2005 | $ | 10.45 | 0.29 | 0.05 | 0.34 | (0.29 | ) | |||||||||||||
For the year ended December 31, 2006 | $ | 10.27 | 0.32 | 0.29 | 0.61 | (0.32 | ) | |||||||||||||
For the six months ended June 30, 2007 (Unaudited) | $ | 10.46 | 0.18 | 0.11 | 0.29 | (0.18 | ) | |||||||||||||
Class VI Shares | ||||||||||||||||||||
For the year ended December 31, 2004 (e) | $ | 10.26 | 0.21 | 0.25 | 0.46 | (0.21 | ) | |||||||||||||
For the year ended December 31, 2005 | $ | 10.45 | 0.31 | 0.04 | 0.35 | (0.31 | ) | |||||||||||||
For the year ended December 31, 2006 | $ | 10.26 | 0.31 | 0.29 | 0.60 | (0.33 | ) | |||||||||||||
For the six months ended June 30, 2007 (Unaudited) | $ | 10.43 | 0.18 | 0.11 | 0.29 | (0.19 | ) | |||||||||||||
[Additional columns below]
[Continued from above table, first column(s) repeated]
Distributions | ||||||||||||||||||||||||
Net Assets | Ratio of | |||||||||||||||||||||||
Net | Net Asset | at End of | Expenses | |||||||||||||||||||||
realized | Total | Value, End | Total | Period | to Average | |||||||||||||||||||
gains | Distributions | of Period | Return (a) | (000s) | Net Assets (b) | |||||||||||||||||||
Class II Shares | ||||||||||||||||||||||||
For the year ended December 31, 2002 | – | (0.21 | ) | $ | 9.83 | 0.40% | $ | 90,358 | 0.56% | |||||||||||||||
For the year ended December 31, 2003 | (0.04 | ) | (0.28 | ) | $ | 10.32 | 7.91% | $ | 90,624 | 0.56% | ||||||||||||||
For the year ended December 31, 2004 (f) | (0.10 | ) | (0.34 | ) | $ | 10.45 | 4.65% | $ | 256,277 | 0.56% | ||||||||||||||
For the year ended December 31, 2005 | (0.23 | ) | (0.52 | ) | $ | 10.27 | 3.31% | $ | 280,331 | 0.57% | ||||||||||||||
For the year ended December 31, 2006 | (0.10 | ) | (0.42 | ) | $ | 10.46 | 6.16% | $ | 304,610 | 0.57% | ||||||||||||||
For the six months ended June 30, 2007 (Unaudited) | (0.25 | ) | (0.43 | ) | $ | 10.32 | 2.72% | $ | 299,112 | 0.55% | ||||||||||||||
Class VI Shares | ||||||||||||||||||||||||
For the year ended December 31, 2004 (e) | (0.06 | ) | (0.27 | ) | $ | 10.45 | 4.48% | $ | 1,454 | 0.41% | ||||||||||||||
For the year ended December 31, 2005 | (0.23 | ) | (0.54 | ) | $ | 10.26 | 3.39% | $ | 4,645 | 0.47% | ||||||||||||||
For the year ended December 31, 2006 | (0.10 | ) | (0.43 | ) | $ | 10.43 | 6.13% | $ | 5,942 | 0.57% | ||||||||||||||
For the six months ended June 30, 2007 (Unaudited) | (0.25 | ) | (0.44 | ) | $ | 10.28 | 2.71% | $ | 5,160 | 0.56% | ||||||||||||||
[Additional columns below]
[Continued from above table, first column(s) repeated]
Ratios/Supplemental Data | ||||||||||||||||||
Ratio of Net | ||||||||||||||||||
Ratio of | Investment | |||||||||||||||||
Ratio of Net | Expenses | Income | ||||||||||||||||
Investment | (Prior to | (Prior to | ||||||||||||||||
Income | Reimbursements) | Reimbursements) | ||||||||||||||||
to Average | to Average | to Average | Portfolio | |||||||||||||||
Net Assets (b) | Net Assets (b)(c) | Net Assets (b)(c) | Turnover (d) | |||||||||||||||
Class II Shares | ||||||||||||||||||
For the year ended December 31, 2002 | 3.30% | (g) | (g) | 28.70% | ||||||||||||||
For the year ended December 31, 2003 | 2.55% | (g) | (g) | 24.84% | ||||||||||||||
For the year ended December 31, 2004 (f) | 2.39% | (g) | (g) | 15.34% | ||||||||||||||
For the year ended December 31, 2005 | 2.79% | (g) | (g) | 30.49% | ||||||||||||||
For the year ended December 31, 2006 | 3.10% | (g) | (g) | 45.93% | ||||||||||||||
For the six months ended June 30, 2007 (Unaudited) | 3.36% | 0.55% | 3.36% | 94.15% | ||||||||||||||
Class VI Shares | ||||||||||||||||||
For the year ended December 31, 2004 (e) | 3.00% | (g) | (g) | 15.34% | ||||||||||||||
For the year ended December 31, 2005 | 2.95% | (g) | (g) | 30.49% | ||||||||||||||
For the year ended December 31, 2006 | 3.13% | (g) | (g) | 45.93% | ||||||||||||||
For the six months ended June 30, 2007 (Unaudited) | 3.38% | 0.56% | 3.38% | 94.15% | ||||||||||||||
(a) | Not annualized for periods less than one year. | |
(b) | Annualized for periods less than one year. | |
(c) | During the period, certain fees were waived and/or reimbursed. If such waivers/reimbursements had not occurred, the ratios would have been as indicated. | |
(d) | Portfolio turnover is calculated on the basis of the Fund as a whole without distinguishing among the classes of shares. | |
(e) | For the period from April 30, 2004 (commencement of operations) through December 31, 2004. | |
(f) | On April 30, 2004, the existing share Class of the Fund was renamed Class II Shares. | |
(g) | There were no fee reductions during the period. |
See accompanying notes to financial statements.
1. Organization
Nationwide Variable Insurance Trust (“NVIT” or the “Trust”) is an open-end management investment company, organized under the laws of Delaware by an amended and restated Agreement and Declaration of Trust, dated October 28, 2004, as amended to date. Prior to May 1, 2007, the Trust was named “Gartmore Variable Insurance Trust”. The Trust, originally created under the laws of Massachusetts as a Massachusetts business trust pursuant to a Declaration of Trust dated, as of June 30, 1981, and as subsequently amended, redomesticated as a Delaware Statutory Trust after the close of trading on April 29, 2005, and is registered under the Investment Company Act of 1940, as amended (the “1940 Act”). The redomestication was a change in statutory status and did not affect the operations of the Trust. As of June 30, 2007, the Trust had authorized an unlimited number of shares of beneficial interest, without par value (“shares”). The Trust currently offers shares to life insurance company separate accounts to fund the benefits under variable life insurance or annuity policies. To date, only the separate accounts of Nationwide Life Insurance Company and Nationwide Life and Annuity Insurance Company (collectively, “Nationwide”) have purchased shares of the Nationwide NVIT Investor Destinations Conservative Fund (the “Fund”) (formerly, “Gartmore GVIT Investor Destinations Conservative Fund”). The Trust currently operates forty (40) separate series, or mutual funds, each with its own investment objectives and strategies. This report contains the financial statements and financial highlights of the Fund.
The Fund is constructed as a “fund of funds,” which means that the Fund pursues its investment objective by allocating the Fund’s investments primarily among other mutual funds (the “Underlying Funds”). The Underlying Funds typically invest, either directly or indirectly, in stocks, bonds, and other securities, including the Nationwide Contract. The Nationwide Contract is a fixed interest contract issued and guaranteed by Nationwide Life Insurance Company (“Nationwide”). This contract has a stable principal value and will pay the Fund a fixed rate of interest. The fixed interest rate must be at least 3.50% (on an annual basis), but may be higher and is currently adjusted on a quarterly basis. Nationwide will calculate the interest rate in the same way that it calculates guaranteed interest rates for similar contracts. Because the contract is guaranteed by Nationwide, assuming no default, the Fund receives no more or less than the guaranteed amount and will not directly participate in the actual experience of the assets underlying the contract. Although under certain market conditions the Fund’s performance may be hurt by its investment in the Nationwide Contract, the portfolio management team believes that the relatively stable nature of the Nationwide Contract should reduce the Fund’s volatility and overall risk, especially when the bond and stock markets decline simultaneously. The Fund’s target allocation range is 20-30%.
2. Summary of Significant Accounting Policies
The following is a summary of significant accounting policies followed by the Fund in the preparation of its financial statements. The policies are in conformity with accounting principles generally accepted in the United States of America (“GAAP”). The preparation of financial statements requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of income and expenses for the period. Actual results could differ from those estimates.
(a) | Security Valuation |
Shares of the Underlying Funds in which the Fund invests are valued at their respective net asset values as reported by the Underlying Funds. The securities in the Underlying Funds generally are valued as of the close of business of the regular session of trading on the New York Stock Exchange (usually at 4 p.m. Eastern time). The Underlying Funds generally value securities and assets at current market value. Under most circumstances, the fixed interest contract is valued at par value each day, which is deemed to be fair value. The par value is calculated each day by the summation of the following factors: prior day’s par value; prior day’s interest accrued (par multiplied by guaranteed fixed rate); and current day net purchase or redemption. | |
The following policies, (b) through (h), represent the accounting policies applicable to the Underlying Funds. |
(b) | Repurchase Agreements |
The Fund may enter into repurchase agreements with an entity which is a member of the Federal Reserve System or which is a “primary dealer” (as designated by the Federal Reserve Bank of New York) in U.S. Government obligations. The repurchase price generally equals the price paid by the Fund plus interest negotiated on the basis of current short-term rates, which may be more or less than the rate on the underlying portfolio securities. The seller under a repurchase agreement is required to maintain the value of the collateral held pursuant to the agreement at a market value equal to or greater than the repurchase price (including accrued interest). Collateral subject to repurchase agreements is held by the Fund’s custodian or another qualified sub-custodian or in the Federal Reserve/ Treasury book-entry system. If the counterparty defaults and the fair value of the collateral declines, realization of the collateral by the Fund may be delayed or limited. The Fund may transfer uninvested cash balances into a pooled cash account. These balances are invested in one or more repurchase agreements, with the counterparty of Nomura Securities, which is fully collateralized by U.S. Government Agency Mortgages. |
(c) | Foreign Currency Transactions |
The accounting records of the Fund are maintained in U.S. dollars. Foreign currency amounts are translated into U.S. dollars at the current rate of exchange to determine the value of investments, assets and liabilities. The Fund may enter into foreign currency contracts in connection with purchases or sales of securities denominated in a foreign currency. Purchases and sales of securities, and income and expenses, are translated at the prevailing rate of exchange on the respective date of these transactions. The Fund does not isolate that portion of the results of operations resulting from changes in foreign exchange rates on investments from fluctuations arising from changes in market prices of securities held. These fluctuations are included with the net realized and unrealized gain or loss from investments and foreign currencies. |
(d) | Forward Foreign Currency Contracts |
The Fund may enter into forward foreign currency contracts in connection with planned purchases or sales of securities or to hedge the U.S. dollar value of portfolio securities denominated in a particular currency. The Fund could be exposed to risks if the counterparties to the contracts are unable to meet the terms of their contracts and from unanticipated movements in the value of a foreign currency relative to the U.S. dollar. Forward foreign currency contracts are valued at the current cost of covering these contracts, as provided by an independent pricing service approved by the Trust’s Board of Trustees (“Board of Trustees”). The forward foreign currency contracts are adjusted by the daily exchange rate of the underlying currency and any gains or losses are recorded for financial statement purposes as unrealized gains or losses until the contract settlement date. |
(e) | Futures Contracts |
The Fund may invest in financial futures contracts (“futures contracts”) for the purpose of hedging its existing portfolio securities or securities that the Fund intends to purchase against fluctuations in value caused by changes in prevailing market interest rates or prices. Futures contracts may also be entered into for non-hedging purposes. | |
Upon entering into a futures contract, the Fund is required to pledge to the broker an amount of cash and/or other assets equal to a certain percentage of the contract amount (initial margin deposit). Subsequent payments, known as “variation margin,” are made each day, depending on the daily fluctuations in the fair value/market value of the underlying assets. A gain or loss equal to the daily variation margin is recognized on a daily basis. Futures contracts are valued daily at their last quoted sale price. | |
A “sale” of a futures contract means the creation of a contractual obligation to deliver the securities or foreign currency called for by the contract at a fixed price at a specified time in the future. A “purchase” of a futures contract means the creation of a contractual obligation to acquire the securities or foreign currency at a fixed price at a specified time in the future. |
Should market conditions change unexpectedly, the Fund may not achieve the anticipated benefits of the futures contracts and may realize a loss. The use of futures transactions for hedging purposes involves the risk of imperfect correlation in movements in the price of futures contracts, interest rates, and the value of the underlying hedged assets. |
(f) | Written Options Contracts |
The Fund may write options contracts. A written option obligates the Fund to deliver (written call) or to receive (written put) a specified quantity of an underlying asset at the contract amount upon exercise by the holder of the option. When the Fund writes an option, an amount equal to the premium received by the Fund is recorded as a liability and is subsequently adjusted to the current fair value of the option written. Premiums received from writing options that expire unexercised are treated by the Fund on the expiration date as realized gains from investments. The difference between the premium and the amount paid on effecting a closing purchase transaction, as a realized loss. If a call option is exercised, the premium is added to the proceeds from the sale of the underlying security or currency in determining whether the Fund has realized a gain or loss. If a put option is exercised, the premium reduces the cost basis of the securities purchased by the Fund. Options traded on an exchange are valued at the last quoted sale price, or in the absence of a sale, the bid price provided by an independent pricing service approved by the Board of Trustees. Non-exchange traded options are valued using dealer supplied quotes. The Fund as a writer of an option bears the market risk of an unfavorable change in the price of the security underlying the written option. |
(g) | Mortgage Dollar Rolls |
The Fund may enter into mortgage “dollar rolls” in which the Fund sells mortgage-backed securities for delivery in the current month and simultaneously contracts to repurchase substantially similar (same type, coupon, and maturity) securities on a specified future date. Mortgage dollar rolls may be implemented in the “to be announced” (“TBA”) market and are referred to as TBAs on the Statement of Investments of the Fund. During the roll period, the Fund foregoes principal and interest paid on the mortgage-backed securities. Each mortgage dollar roll is treated as a financing transaction; therefore, any gain or loss is considered unrealized until the roll reaches completion. Risks may arise due to the delayed payment date and the potential inability of counterparties to complete the transaction. Income is generated as consideration for entering into these transactions and is included in interest income on the Statement of Operations. |
(h) | Short Sales |
The Fund is authorized to engage in short-selling of portfolio securities which obligates the Fund to replace any security that the Fund has borrowed by purchasing the security at current market value sometime in the future. The Fund will incur a loss if the price of the security increases between the date of the short sale and the date on which the Fund replaces the borrowed security. The Fund generally will realize a gain if the price of the security declines between these dates. Until the Fund replaces the borrowed security, the Fund will maintain a segregated account with cash, U.S. Government securities and/or securities held long to sufficiently cover the Fund’s short position on a daily basis. Dividends declared on securities sold short are recorded as an expense on the ex-dividend date and paid to the counterparty on the dividend pay date. |
(i) | Security Transactions and Investment Income |
Security transactions are accounted for on the date the security is purchased or sold (“trade date”). Securities gains and losses are calculated on the identified cost basis. Interest income is recognized on the accrual basis and includes, where applicable, the amortization or accretion of premium or discount. Dividend income is recorded on the ex-dividend date. |
(j) | Distributions to Shareholders |
The Fund’s dividends from net investment income, if any, are declared and paid quarterly. The Fund’s distributions from net realized capital gains, if any, are declared and distributed at least annually. | |
Dividends and distributions to shareholders are determined in accordance with federal income tax regulations, which may differ from GAAP. These “book/tax” differences are considered either permanent or temporary in nature. In accordance with the American Institute of Certified Public Accountants Statement of Position 93-2, permanent differences (i.e., reclassification of market discounts, foreign exchange gain/loss, paydowns, and distributions from real estate investment trusts) are reclassified within the capital accounts based on their nature for federal income tax purposes; temporary differences do not require reclassification. These reclassifications have no effect upon the net asset value of the Fund. To the extent distributions exceed current and accumulated earnings and profits for federal income tax purposes, these distributions are reported as distributions of paid-in-capital. |
(k) | Federal Income Taxes |
It is the policy of the Fund to qualify or to continue to qualify as a “regulated investment company” by complying with the provisions available to certain investment companies, as defined in Subchapter M of the U.S. Internal Revenue Code, and to make distributions of net investment income and net realized capital gains sufficient to relieve the Fund from all, or substantially all, federal income taxes. | |
As of June 30, 2007, the tax cost of securities and the breakdown of unrealized appreciation (depreciation) for the Fund was as follows: |
Net | ||||||||||||||||
Unrealized | ||||||||||||||||
Tax Cost of | Unrealized | Unrealized | Appreciation | |||||||||||||
Securities | Appreciation | Depreciation | (Depreciation) | |||||||||||||
$ | 302,594,293 | $ | 3,859,368 | $ | (2,026,685 | ) | $ | 1,832,683 | ||||||||
(l) | Allocation of Expenses, Income, and Gains and Losses |
Expenses directly attributable to the Fund are charged to the Fund. Expenses not directly attributable to the Fund are allocated proportionately among various or all funds within the Trust. The method used by the Fund for allocating income, fund level expenses, and realized and unrealized gains or losses is based on the fair value of shares outstanding relative to net assets. Under this method, each class of shares participates based on the total net asset value of that class’s shares in proportion to the total net assets of the Fund. Expenses specific to a class (such as Rule 12b-1 and administrative services fees) are charged to that class.
3. Transactions with Affiliates
Under the terms of the Trust’s Investment Advisory Agreement, Nationwide Fund Advisors (formerly, Gartmore Mutual Fund Capital Trust (“GMF”)) (“NFA” or the “Advisor”) manages the investment of the assets and supervises the daily business affairs of the Fund. NFA is a wholly-owned subsidiary of Nationwide Financial Services (“NFS”).
Under the terms of the Investment Advisory Agreement, the Fund pays NFA an investment advisory fee of 0.13% based on the Fund’s average daily net assets.
Under the terms of a Fund Administration and Transfer Agency Agreement, Nationwide Fund Management, LLC (formerly, Gartmore Investor Services, Inc. (“GISI”)) (“NFM”), a wholly-owned subsidiary of NFS Distributors, Inc. (“NFSDI”), provides various administrative and accounting services for the Funds (prior to May 1, 2007, this service was provided by Gartmore SA Capital Trust (“GSA”)), and, serves as Transfer Agent and Dividend Disbursing Agent for each of the Funds (prior to May 1, 2007, this service was provided by GISI, an indirect subsidiary of GSA). The Funds do not pay a fee for these.
NFA and NFM have entered into agreements with Citi Fund Services Ohio, Inc. (“Citi”), pursuant to which Citi provides sub-administration and sub-transfer agency services, respectively, to the Fund. Effective August 1, 2007, The BISYS Group Inc. was acquired by and became a wholly owned subsidiary of Citi.
Under the terms of a Distribution Plan under Rule 12b-1 of the 1940 Act, Nationwide Fund Distributors, LLC. (formerly, “Gartmore Distribution Services, Inc. (“GDSI”)) (“NFD” or “Distributor”), the Fund’s principal underwriter, is compensated by the Fund for expenses associated with the distribution of the Class II and Class VI shares of the Fund. NFD is a wholly-owned subsidiary of NFSDI. These fees are based on average daily net assets of each class of shares of the Fund at an annual rate not to exceed 0.25%.
Under the terms of an Administrative Services Plan, the Fund may pay fees to servicing organizations, such as broker-dealers, including NFS, and financial institutions, which agree to provide administrative support services to the shareholders of certain classes. These services include, but are not limited, to the following: establishing and maintaining shareholder accounts; processing purchase and redemption transactions; arranging bank wires; performing shareholder sub-accounting; answering inquires regarding the Fund; and other such services. These fees are based on an annual rate of up to 0.25% of the average daily net assets of each class of shares of the Fund.
For the six months ended June 30, 2007, NFS received $229,431 in Administrative Services Fees from the Fund.
Under the terms of a letter agreement dated September 12, 2006, by and among NFA, the Audit Committee of the Trust and the Trust, the Trust has agreed to reimburse NFA certain costs related to the Fund’s portion of ongoing administration, monitoring and annual (audit) testing of the Trust’s Rule 38a-1 Compliance Program subject to the pre-approval of the Trust’s Audit Committee. For the six months ended June 30, 2007, the Fund’s portion of such costs amounted to $2,167.
Because the Fund invests primarily in other affiliated funds, the Fund is a shareholder of those Underlying Funds. The Underlying Funds do not charge the Fund any sales charge for buying or selling shares. However, the Fund indirectly pays a portion of the operating expenses, including management fees of the Underlying Funds and short-term investments the Fund holds. These expenses are deducted from the Underlying Funds before their share prices are calculated and are in addition to the fees and expenses of the Fund. Actual indirect expenses vary depending on how the Fund’s assets are spread among the underlying investments.
4. Short-Term Trading Fees
The Fund reserves the right to assess a short-term trading fee on certain transactions out of Class VI shares that a separate account makes on behalf of a variable insurance contract owner (the “contract owner”). A separate account that redeems Class VI shares on behalf of a contract owner may be subject to a 1.00% short-term trading fee if the separate account held the Class VI shares on behalf of the contract owner for 60 days or less, unless an exception applies as disclosed in the Fund’s prospectus. The short-term trading fee is paid directly to the Fund and is intended to offset the cost to the Fund of excess brokerage commissions and other costs associated with fluctuations in Fund asset levels and cash flow caused by short-term trading. For purposes of determining whether the short-term trading fee applies, the Class VI shares that were held on behalf of the contract owner the longest will be treated as being redeemed first.
For the six months ended June 30, 2007, the Fund had contributions to capital due to collection of redemption fees in the amount of $2,229.
5. Investment Transactions
For the six months ended June 30, 2007, (excluding short-term securities) the Fund had purchases of $230,822,102 and sales of $235,921,395.
6. Bank Loans and Earnings Credit
The Trust has a credit agreement with JPMorgan Chase & Co., the Fund’s custodian bank, permitting the Trust to borrow up to $100,000,000. Borrowings under this arrangement bear interest at the Federal Funds rate plus 0.50%. The
The Trust’s custodian bank has agreed to reduce the bank’s fees (earnings credit) when the funds of the Trust maintain cash on deposit in non-interest-bearing custody and Demand Deposit Accounts. Earnings credits, if any, are shown as a reduction of total expenses on the Statement of Operations.
7. Portfolio Investment Risks
Risks Associated with Foreign Securities and Currencies. Investments in securities of foreign issuers carry certain risks not ordinarily associated with investments in securities of U.S. issuers. These risks include future political and economic developments, and the possible imposition of exchange controls or other foreign governmental laws and restrictions. In addition, with respect to certain countries, there is the possibility of expropriation of assets, confiscatory taxation, political or social instability, or diplomatic developments, which could adversely affect investments in those countries.
Certain countries also may impose substantial restrictions on investments in their capital markets by foreign entities, including restrictions on investments in issuers of industries deemed sensitive to relevant national interests. These factors may limit the investment opportunities available and result in a lack of liquidity and high price volatility with respect to securities of issuers from developing countries.
8. Indemnifications
Under the Trust’s organizational documents, certain of the Trust’s Officers and Trustees are indemnified against certain liabilities arising out of the performance of their duties to the Trust. In addition, the Trust has entered into Indemnification Agreements with the Trust’s trustees and certain officers covering similar liabilities. Trust Officers receive no compensation from the Trust for serving as the Trust’s Officers. In addition, in the normal course of business, the Trust enters into contracts with its vendors and others that provide for general indemnifications. The Trust’s maximum exposure under these arrangements is unknown, as this would involve future claims that may be made against the Trust. Based on experience, however, the Trust expects that risk of loss to be remote.
9. Recently Issued Accounting Pronouncements
On July 13, 2006, the Financial Accounting Standards Board (“FASB”) released FASB Interpretation No. 48, Accounting for Uncertainty in Income Taxes (“FIN 48”). FIN 48 provides guidance for how uncertain tax positions should be recognized, measured, presented and disclosed in the financial statements. FIN 48 requires the affirmative evaluation of tax positions taken or expected to be taken in the course of preparing the Fund’s tax returns to determine whether it is more-likely-than-not (i.e., greater than 50 percent) that each tax position will be sustained upon examination by a taxing authority based on the technical merits of the position. A tax position that meets the more-likely-than-not recognition threshold is measured to determine the amount of benefit to recognize in the financial statements. Differences between tax positions taken in a tax return and amounts recognized in the financial statements will generally result in an increase in a liability for taxes payable (or a reduction of a tax refund receivable) and an increase in a deferred tax liability (or a reduction in a deferred tax asset). Adoption of FIN 48 was required no later than the last business day of the first financial statement reporting period for fiscal years beginning after December 15, 2006 and is to be applied to all open tax years as of the effective date. Accordingly, the Fund was required to implement FIN 48 in its net asset value per share (NAV) calculation on June 29, 2007. Management has evaluated the implications of FIN 48 and has concluded that there was no impact to the Fund’s financial statements as of June 29, 2007. The adoption of FIN 48 requires ongoing monitoring and analysis, future conclusions reached by management may be different and result in adjustments to the Fund’s NAV and financial statements.
In September 2006, the FASB issued Statement on Financial Accounting Standards (“SFAS”) No. 157, “Fair Value Measurements.” This standard establishes a single authoritative definition of fair value, sets out a framework for
Trustees who are not Interested Persons (as defined in the 1940 Act) and Officers of the Trust as of
Number of Portfolios | ||||||||||
Position(s) Held | in the | |||||||||
with the Trust | Principal Occupation(s) | Nationwide Fund | Other | |||||||
Name, Address | and Length of | During Past | Complex Overseen | Directorships | ||||||
and Year of Birth | Time Served1 | Five Years | by Trustee | Held by Trustee2 | ||||||
Charles E. Allen c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1948 | Trustee since July 2000 | Mr. Allen is Chairman, Chief Executive Officer and President of Graimark Realty Advisors, Inc. (real estate development, investment and asset management). | 89 | None | ||||||
Paula H.J. Cholmondeley c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1947 | Trustee since July 2000 | Ms. Cholmondeley was Vice President and General Manager of Sappi Fine Paper North America from April 2000 through December 2003. | 89 | Director of Dentsply International, Inc. (dental products), Ultralife Batteries, Inc., Terex Corporation (construction equipment), Minerals Technology, Inc. (specialty chemicals) and Albany International Corp. (paper industry) | ||||||
C. Brent DeVore3 c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1940 | Trustee since 1990 | Dr. DeVore is President of Otterbein College. | 89 | None | ||||||
Phyllis Kay Dryden c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1947 | Trustee since December 2004 | Ms. Dryden was a partner of Mitchell Madison, a management consulting company from January 2006 until December 2006; she is currently a consultant with the company. Ms. Dryden was formerly Managing Partner of march FIRST, a global management consulting firm. | 89 | None | ||||||
Barbara L. Hennigar c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1935 | Trustee since July 2000 | Retired. | 89 | None |
Number of Portfolios | ||||||||||
Position(s) Held | in the | |||||||||
with the Trust | Principal Occupation(s) | Nationwide Fund | Other | |||||||
Name, Address | and Length of | During Past | Complex Overseen | Directorships | ||||||
and Year of Birth | Time Served1 | Five Years | by Trustee | Held by Trustee2 | ||||||
Barbara I. Jacobs c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1950 | Trustee since December 2004 | Ms. Jacobs served as Chairman of the Board of Directors of KICAP Network Fund, a European (United Kingdom) hedge fund, from January 2001 through January 2006. From 1998-2003, Ms. Jacobs was also a Managing Director and European Portfolio Manager of CREF Investments (Teachers Insurance and Annuity Association-College Retirement Equities Fund). | 89 | None | ||||||
Douglas F. Kridler c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1955 | Trustee since September 1997 | Mr. Kridler has served as the President and Chief Executive Officer of the Columbus Foundation (a Columbus, OH-based foundation which manages over 1,300 individual endowment funds) since February 2002. Prior to January 31, 2002, Mr. Kridler was the President of the Columbus Association for the Performing Arts and Chairman of the Greater Columbus Convention and Visitors Bureau. | 89 | None | ||||||
Michael D. McCarthy c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1947 | Trustee since December 2004 | Retired. Mr. McCarthy was Chairman of VMAC (commodity swaps) from October 2002 until January 2007; and a partner of Pineville Properties LLC (a commercial real estate development firm) from September 2000 until January 2007. | 89 | None | ||||||
David C. Wetmore c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1948 | Trustee since 1995 and Chairman since February 2005 | Retired. | 89 | None | ||||||
1 | Length of time served includes time served with the Trust’s predecessors. | |
2 | Directorships held in (1) any other investment companies registered under the 1940 Act, (2) any company with a class of securities registered pursuant to Section 12 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or (3) any company subject to the requirements of Section 15(d) of the Exchange Act. | |
3 | Mr. DeVore has served as President of Otterbein College since 1984. Mark Thresher, President and Chief Operating Officer of Nationwide Financial Services, Inc. (“NFS”) has served as a member of the Board of Trustees of Otterbein College since 2000, currently serves as one of 30 of its trustees, and is currently one of two Vice Chairmen of the Board. Each of Nationwide Fund Advisors (“NFA”), the Funds’ investment adviser, and Nationwide Fund Distributors LLC (“NFD”), principal underwriter to the Trust, is a wholly-owned subsidiary of NFS. | |
Additional information regarding the Trustees and Officers may be found in the Trust’s Statement of Additional Information, which is available without charge upon request, by calling 800-848-0920. |
Trustees who are Interested Persons (as defined in the 1940 Act) and/or Officers of the Trust as of
Number of Portfolios | ||||||||||
Position(s) Held | in the | |||||||||
with the Trust | Principal Occupation(s) | Nationwide Fund | Other | |||||||
Name, Address | and Length of | During Past | Complex Overseen | Directorships | ||||||
and Year of Birth | Time Served1 | 5 Years | by Trustee | Held by Trustee 2 | ||||||
Arden L. Shisler c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1941 | Trustee since February 2000 | Retired. Mr. Shisler is the former President and Chief Executive Officer of KeB Transport, Inc., a trucking firm (2000 through 2002). He served as a consultant to KeB from January 2003 through December 2004. Since 1992, Mr. Shisler has also been Chairman of the Board for Nationwide Mutual Insurance Company.3 | 89 | Director of Nationwide Financial Services, Inc., Chairman of Nationwide Mutual Insurance Company3 | ||||||
John H. Grady Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1961 | President & Chief Executive Officer since December 2006 | Mr. Grady is President, and Chief Executive Officer of Nationwide Funds Group which includes Nationwide Fund Advisors,3 Nationwide Fund Management LLC,3 Nationwide Fund Distributors LLC 3 and NWD Investments,2 the asset management operations of Nationwide Mutual Insurance Company, which includes Morley Capital Management, Inc.,2 Nationwide Separate Accounts LLC,2 NorthPointe Capital LLC,2 and Nationwide SA Capital Trust2. From March 2004 until March 2006, Mr. Grady was Chief Executive Officer of Constellation Investment Management Co., L.P. (registered investment adviser), and President and Chief Executive Officer of Constellation Funds Group (registered investment companies). He also was President of Constellation Investment Distribution Co., Inc. (registered broker-dealer) from March 2004 until June 2006. From February 2001 until February 2004, Mr. Grady was Chief Operating and Chief Legal Officer; Managing Director, Mutual Funds Group, Turner Investment Partners, Inc. (registered investment adviser); Executive Vice President of Turner Funds and Turner Institutional Portfolios (registered investment companies); and President, Turner Investment Distributors, Inc. (registered broker-dealer). | N/A | None | ||||||
Gerald J. Holland Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1951 | Treasurer since March 2001 | Mr. Holland is Senior Vice President—Operations for Nationwide Funds Group3. | N/A | N/A | ||||||
Number of Portfolios | ||||||||||
Position(s) Held | in the | |||||||||
with the Trust | Principal Occupation(s) | Nationwide Fund | Other | |||||||
Name, Address | and Length of | During Past | Complex Overseen | Directorships | ||||||
and Year of Birth | Time Served1 | 5 Years | by Trustee | Held by Trustee 2 | ||||||
Michael A. Krulikowski Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1959 | Chief Compliance Officer from June 2004 to August 20074 | Mr. Krulikowski is Vice President and Chief Compliance Officer of Nationwide Funds Group3, Morley Capital Management, Inc.3, Nationwide SA Capital Trust (since 1999)3, and Nationwide Separate Accounts LLC (since August 2005).3 Since June 2004, Mr. Krulikowski has also served as Chief Compliance Officer of the Trust. From November 1999 through May 2007, he served as Vice President and Chief Compliance Officer of NorthPointe Capital LLC. 3 | N/A | N/A | ||||||
Eric E. Miller Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1953 | Secretary since December 2002 | Mr. Miller is Senior Vice President, General Counsel, and Assistant Secretary for Nationwide Funds Group3 and NWD Investments.2 From August 2000 to August 2002, Mr. Miller was a Partner with Stradley Ronon Stevens & Young, LLP. | N/A | N/A | ||||||
1 | Length of time served includes time served with the Trust’s predecessors. | |
2 | Directorships held in (1) any other investment companies registered under the 1940 Act, (2) any company with a class of securities registered pursuant to Section 12 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or (3) any company subject to the requirements of Section 15(d) of the Exchange Act. | |
3 | This position is held with an affiliated person or principal underwriter of the Trust. | |
4 | Effective August 3, 2007, the Board of Trustees approved Carol Baldwin Moody as Chief Compliance Officer of the Trust. Since November 2005, Ms. Moody has been Senior Vice President, Chief Compliance Officer of Nationwide Financial Services, Nationwide Life Insurance Company, Nationwide Life and Annuity Insurance Company, and Nationwide Investment Advisors, LLC. From February 2004-November 2005, she was Chief Compliance Officer of TIAA-CREF and from April 2000-February 2004, she was Managing Director and General Counsel, TCW/ Latin America Partners, LLC and Baeza & Co., LLC. | |
Federal law requires the Trust, each of its investment advisers and sub-advisers to adopt procedures for voting proxies (“Proxy Voting Guidelines”) and to provide a summary of those Proxy Voting Guidelines used to vote the securities held by the Funds. The Funds’ proxy voting policies and procedures are available without charge (i) upon request, by calling 800-848-0920, (ii) on the Funds’ website at www.nationwidefunds.com, or (iii) on the Securities and Exchange Commission’s website at www.sec.gov. |
A. Renewal of Investment Advisory Agreement
(i) | General Information Regarding the Board’s Review of Investment Advisory Agreements |
The Trust’s investment advisory agreements (each an “Advisory Agreement”) with its investment adviser and, as applicable, sub-advisers (together, the “Adviser”) must be approved for an initial term no greater than two years, and renewed at least annually thereafter, (i) by the vote of the Trustees or by a vote of the shareholders of each series or fund of the Trust (individually a “Fund”), and (ii) by the vote of a majority of the Trustees who are not parties to the Advisory Agreement or “interested persons” of any party thereto (the “Independent Trustees”) cast in person at a meeting called for the purpose of voting on such approval.
The Board meets quarterly and takes into account throughout the year matters bearing on each Fund’s Advisory Agreement. The Board and its standing committees consider at each meeting factors that are relevant to the annual renewal of an Advisory Agreement, including the services and support provided to a Fund and its shareholders.
On December 6, 2006, the Independent Trustees first met in person with their independent legal counsel (“Independent Legal Counsel”) to consider information provided by the Adviser and others to assist the Trustees in considering whether to renew each Fund’s Advisory Agreement for a one year term beginning May 1, 2007. Immediately following such meeting of the Independent Trustees, all Trustees met in person with the Adviser, Trust counsel, Independent Legal Counsel and others to consider such matters, and give preliminary consideration to information bearing on continuation of each Advisory Agreement. The primary purpose of the December 6 and 7, 2006 meeting was to ensure that the Trustees had ample opportunity to consider matters they deemed relevant in considering the continuation of an Advisory Agreement, and to request any additional information they considered reasonably necessary to their deliberations.
In preparation for the December 6 and 7, 2006 meeting the Trustees were provided, at the request of the Trustees, with a wide range of information to assist in their deliberations, including (i) reports from Lipper Inc. describing a Fund’s (a) performance rankings (where “first quintile” denotes the best performance) (over multiple years ended September 30, 2006) compared with performance groups and performance universes created by Lipper (and in some cases, customized peer groups created by the Adviser) of similar or peer group funds, and (b) expense rankings (where “first quintile” denotes the lowest fees and expenses) comparing the Fund’s contractual advisory fee and total expenses with expense groups and expense universes created by Lipper of similar or peer group funds, (ii) information from the Adviser describing the Fund’s performance (over multiple years ended September 30, 2006) compared with its benchmark and Lipper categories, (iii) for Funds under “close review,” copies of letters from the Adviser to the portfolio manager of each such Fund, together with the portfolio manager’s written response describing the reasons for the Fund’s underperformance (iv) information from the Adviser describing performance for the months of October and November, 2006, and annual performance for the year ended November 30, 2006, (v) reports from the Adviser describing the Adviser’s profitability in providing services under an Advisory Agreement, together with an explanation of Adviser’s methodology in calculating its profitability, (vi) information from the Adviser describing any fees paid to the Adviser for managing similar, non-affiliated institutional accounts, including the range of fee levels for such accounts, and (vii) information from the Adviser describing ancillary benefits, in addition to fees for serving as investment adviser, derived by the Adviser as a result of being investment adviser for a Fund, including, where applicable, information on soft-dollar benefits and fees inuring to the Adviser’s affiliates for serving as the Trust’s administrator, fund accountant and transfer agent.
At the December 6 and 7, 2006 meeting, the Trustees reviewed, considered and discussed, among themselves and with the Adviser, Trust counsel and Independent Legal Counsel, among other things, the information described above, and: (i) the nature, extent and quality of services provided by the Adviser under each Advisory Agreement, (ii) the investment performance of each Fund and the Adviser, (iii) the costs of the services provided by the Adviser under the Advisory Agreement and the profits realized by the Adviser thereunder, (iv) the extent to which economies of scale may be present and, if so, whether they are being shared with a Fund’s shareholders, (v) comparisons of the Adviser’s fees under the Advisory Agreement with investment advisory fees paid by peer group funds to their investment advisers and paid by non-affiliated institutional clients to the Adviser for managing similar accounts, and (vi) any ancillary benefits inuring to the Adviser and its affiliates as a result of being investment adviser for the Trust. The Trustees also considered, where
As part of the December 6 and 7, 2006 Board meeting, the Independent Trustees developed a list of follow-up matters and questions and asked that Adviser respond to such matters and questions at the contract approval meeting of the Board of Trustees to be held on January 11, 2007.
At the January 11, 2007 meeting of the Board of Trustees of the Trust, the Board received and considered information provided by the Adviser in follow-up from the December 6 and 7, 2006 Board meeting and, after consulting among themselves, and with the Adviser, Trust counsel and Independent Legal Counsel, concluded unanimously to renew the Advisory Agreement for the reasons set forth in the following section. In determining whether to renew the Advisory Agreement for the Fund, the Board ultimately reached a determination, with the assistance of Trust counsel and Independent Legal Counsel, that the renewal of the Advisory Agreement and the compensation to be received by the Adviser under the Advisory Agreement is consistent with the Board’s fiduciary duty under applicable law.
(ii) | Board Conclusions Regarding the Fund’s Advisory Agreement |
The Board considered that the Fund had underperformed its secondary benchmark (which is a more appropriate indicator of performance than the Fund’s primary benchmark) for the one-year period and had outperformed its secondary benchmark for the three-year period. The Board also considered that the Fund’s portfolio manager had changed during 2006 and considered the services provided by the adviser to the Fund that are in addition to the advisory services that are provided to the underlying funds. Based on its review, and giving particular weight to the nature and quality of the resources dedicated by the adviser to maintain relative performance, the Board concluded that the nature, extent, and quality of the services provided to the Fund will benefit the Fund’s shareholders.
The Board also considered that the Fund’s contractual advisory fee and breakpoints placed the Fund in the third quintile of its Lipper-constructed Expense Group and the Fund’s total expenses placed the Fund in the second quintile. The Board considered that total expenses were relatively low, and the advisory fee should be consistent among all of the Investor Destination Funds offered by the Trust. The Board concluded that the Fund’s management fee and total expenses were fair and reasonable in light of the services that the Fund receives and the other factors considered.
The Board considered that the Fund’s adviser reported a pre-tax profit margin for investment management services during each of the twelve month-periods ended September 30, 2005 and 2006. The Board considered the costs of the services provided by and the profits realized by the adviser in connection with the operation of the Fund and determined that the amount of profit is a fair entrepreneurial profit for the management of the Fund.
Based upon its evaluation of all of the conclusions noted above, and after considering all material factors with respect to the Fund, the Board ultimately concluded that the advisory fee structure is fair and reasonable, and that the Advisory Agreement (and, if applicable, Sub-Advisory Agreement) with respect to the Fund, should be renewed.
B. Approval of New Advisory Agreement
At its January 11, 2007 meeting, the Board also unanimously approved a new investment advisory agreement (the “New Agreement”) for the Fund with Nationwide Fund Advisors, (“NFA”) the then-current adviser to each of the series of the Trust to become effective upon the closing of the acquisition of NFA by Nationwide Financial Services, Inc. (“NFS”) from Nationwide Corporation (“NWC”) which closed on April 30, 2007 (the “Transaction”). In approving the New Agreement, the Board considered NFA’s capacity to continue to provide the services needed to operate a sophisticated investment management business and to support the management of each of the series. The Board also took into account the information provided to them at their regular quarterly meetings with NFA’s senior management with respect to the Fund, including the information provided by management at the Fund’s annual Section 15(c) meetings on December 6-7, 2006 and January 11, 2007. In addition, the Board also considered NFS’ announced intentions, over time, that NFA
C. Submission of Matters to a Vote of Security Holders:
On April 25, 2007, a Special Meeting of Shareholders was held* (the “April 25 Meeting”) at which shareholders of the Funds** set forth below were asked:
Proposal 1:
To approve a new investment advisory agreement, on behalf of their Fund, between Nationwide Fund Advisors (formerly “Gartmore Mutual Fund Capital Trust”) (the “Adviser”) and Nationwide Variable Insurance Trust (formerly “Gartmore Variable Insurance Trust”) (the “Trust”).
Number of Shares | ||||
Fund | Cast/Not Cast | Percentages | ||
Federated NVIT High Income Bond Fund (Formerly Federated GVIT High Income Bond Fund) | FOR 30,051,703.188 shares AGAINST 618,245.021 shares ABSTAIN 1,813,550.431 shares TOTAL 32,483,498.640 shares | 92.514% 1.903% 5.583% | ||
NVIT International Index Fund (Formerly GVIT International Index Fund) | FOR 4,322,203.982 shares AGAINST 2,758.318 shares ABSTAIN 135,636.840 shares TOTAL 4,460,599.140 shares | 96.897% 0.062% 3.041% | ||
NVIT International Value Fund (Formerly GVIT International Value Fund) | FOR 20,032,843.199 shares AGAINST 333,588.902 shares ABSTAIN 1,093,293.879 shares TOTAL 21,459,725.980 shares | 93.351% 1.554% 5.095% | ||
NVIT Mid Cap Index Fund (Formerly GVIT Mid Cap Index Fund) | FOR 35,380,179.120 shares AGAINST 631,117.844 shares ABSTAIN 1,565,714.306 shares TOTAL 37,577,011.270 shares | 94.154% 1.679% 4.167% | ||
NVIT S&P 500 Index Fund (Formerly GVIT S&P 500 Index Fund) | FOR 56,119,814.230 shares AGAINST 666,195.542 shares ABSTAIN 1,944,898.888 shares TOTAL 58,730,908.660 shares | 95.554% 1.134% 3.312% |
Number of Shares | ||||
Fund | Cast/Not Cast | Percentages | ||
Nationwide Multi-Manager NVIT Small Cap Growth Fund (Formerly GVIT Small Cap Growth Fund) | FOR 7,632,918.513 shares AGAINST 149,458.111 shares ABSTAIN 451,583.036 shares TOTAL 8,233,959.660 shares | 92.700% 1.816% 5.484% | ||
Nationwide Multi-Manager NVIT Small Cap Value Fund (Formerly GVIT Small Cap Value Fund) | FOR 48,649,396.525 shares AGAINST 979,183.753 shares ABSTAIN 2,786,133.102 shares TOTAL 52,414,713.380 shares | 92.816% 1.868% 5.316% | ||
Nationwide Multi-Manager NVIT Small Company Fund (Formerly GVIT Small Company Fund) | FOR 29,903,181.700 shares AGAINST 838,774.923 shares ABSTAIN 2,006,741.307 shares TOTAL 32,748,697.930 shares | 91.311% 2.561% 6.128% | ||
Gartmore NVIT Developing Markets Fund (Formerly Gartmore GVIT Developing Markets Fund) | FOR 21,0177,889.443 shares AGAINST 424,272.958 shares ABSTAIN 1,543,850.729 shares TOTAL 23,046,013.130 shares | 91.460% 1.841% 6.699% | ||
Gartmore NVIT Emerging Markets Fund (Formerly Gartmore GVIT Emerging Markets Fund) | FOR 17,050,534.593 shares AGAINST 526,574.722 shares ABSTAIN 881,608.905 shares TOTAL 18,458,718.220 shares | 92.371% 2.853% 4.776% | ||
Nationwide NVIT Global Financial Services Fund (Formerly Gartmore GVIT Global Financial Services Fund) | FOR 1,554,847.333 shares AGAINST 19,539.033 shares ABSTAIN 52,206.494 shares TOTAL 1,626,592.860 shares | 95.589% 1.201% 3.210% | ||
Nationwide NVIT Global Health Sciences Fund (Formerly Gartmore GVIT Global Health Sciences Fund) | FOR 4,722,963.678 shares AGAINST 157,979.030 shares ABSTAIN 207,642.222 shares TOTAL 5,088,584.930 shares | 92.815% 3.104% 4.081% | ||
Nationwide NVIT Global Technology and Communications Fund (Formerly Gartmore GVIT Global Technology and Communications Fund) | FOR 8,585,472.039 shares AGAINST 102,267.977 shares ABSTAIN 489,577.634 shares TOTAL 9,177,317.650 shares | 93.551% 1.114% 5.335% | ||
Gartmore NVIT Global Utilities Fund (Formerly Gartmore GVIT Global Utilities Fund) | FOR 4,123,270.549 shares AGAINST 122,001.533 shares ABSTAIN 240,276.088 shares TOTAL 4,485,548.170 shares | 91.923% 2.720% 5.357% | ||
Nationwide NVIT Government Bond Fund (Formerly Gartmore GVIT Government Bond Fund) | FOR 88,471,567.462 shares AGAINST 1,825,645.181 shares ABSTAIN 5,841,990.727 shares TOTAL 96,139,203.370 shares | 92.024% 1.899% 6.077% |
Number of Shares | ||||
Fund | Cast/Not Cast | Percentages | ||
Nationwide NVIT Growth Fund (Formerly Gartmore GVIT Growth Fund) | FOR 14,931,435.904 shares AGAINST 409,826.402 shares ABSTAIN 1,259,945.064 shares TOTAL 16,601,207.370 shares | 89.942% 2.469% 7.589% | ||
Gartmore NVIT International Growth Fund (Formerly Gartmore GVIT International Growth Fund) | FOR 6,251,419.070 shares AGAINST 139,618.548 shares ABSTAIN 290,025.592 shares TOTAL 6,681,063.210 shares | 93.569% 2.090% 4.341% | ||
Nationwide NVIT Investor Destinations Aggressive Fund (Formerly Gartmore GVIT Investor Destinations Aggressive Fund) | FOR 49,489,224.549 shares AGAINST 1,385,396.474 shares ABSTAIN 3,696,272.337 shares TOTAL 54,570,893.360 shares | 90.688% 2.539% 6.773% | ||
Nationwide NVIT Investor Destinations Conservative Fund (Formerly Gartmore GVIT Investor Destinations Conservative Fund) | FOR 23,091,965.887 shares AGAINST 314,935,884 shares ABSTAIN 2,292,355.179 shares TOTAL 25,699,256.950 shares | 89.855% 1.225% 8.920% | ||
Nationwide NVIT Investor Destinations Moderate Fund (Formerly Gartmore GVIT Investor Destinations Moderate Fund) | FOR 188,902,093.059 shares AGAINST 3,018,924.590 shares ABSTAIN 16,359,690.401 shares TOTAL 208,280,708.050 shares | 90.696% 1.449% 7.855% | ||
Nationwide NVIT Investor Destinations Moderately Aggressive Fund (Formerly Gartmore GVIT Investor Destinations Moderately Aggressive Fund) | FOR 134,792,622.920 shares AGAINST 3,489,207.264 shares ABSTAIN 9,304,197.656 shares TOTAL 147,586,027.840 shares | 91.332% 2.364% 6.304% | ||
Nationwide NVIT Investor Destinations Moderately Conservative Fund (Formerly Gartmore GVIT Investor Destinations Moderately Conservative Fund) | FOR 49,627,123.216 shares AGAINST 856,088.634 shares ABSTAIN 3,507,215.650 shares TOTAL 53,990,427.500 shares | 91.918% 1.586% 6.496% | ||
Nationwide NVIT Mid Cap Growth Fund (Formerly Gartmore GVIT Mid Cap Growth Fund) | FOR 10,879,584.971 shares AGAINST 352,594.958 shares ABSTAIN 717,792.971 shares TOTAL 11,949,972.900 shares | 91.043% 2.950% 6.007% | ||
Nationwide NVIT Money Market Fund II (Formerly Gartmore GVIT Money Market Fund II) | FOR 221,774,863.241 shares AGAINST 12,322,482.494 shares ABSTAIN 16,471,740.875 shares TOTAL 250,569,086.610 shares | 88.508% 4.918% 6.574% |
Number of Shares | ||||
Fund | Cast/Not Cast | Percentages | ||
Nationwide NVIT Money Market Fund (Formerly Gartmore GVIT Money Market Fund) | FOR 1,578,331,008.328 shares AGAINST 32,372,133.671 shares ABSTAIN 112,652,123.301 shares TOTAL 1,723,355,265.300 shares | 91.585% 1.878% 6.537% | ||
NVIT Nationwide Fund (Formerly Gartmore GVIT Nationwide Fund) | FOR 125,423,274.735 shares AGAINST 2,767,979.467 shares ABSTAIN 8,762,255.828 shares TOTAL 136,953,510.030 shares | 91.581% 2.021% 6.398% | ||
NVIT Nationwide Leaders Fund (Formerly Gartmore GVIT Nationwide Leaders Fund) | FOR 2,298,504.956 shares AGAINST 29,630.469 shares ABSTAIN 71,637.755 shares TOTAL 2,399,773.180 shares | 95.780% 1.235% 2.985% | ||
Nationwide NVIT U.S. Growth Leaders Fund (Formerly Gartmore GVIT U.S. Growth Leaders Fund) | FOR 4,972,094.773 shares AGAINST 122,623.161 shares ABSTAIN 174,625.606 shares TOTAL 5,269,343.540 shares | 94.359% 2.327% 3.314% | ||
Gartmore NVIT Worldwide Leaders Fund (Formerly Gartmore GVIT Worldwide Leaders Fund) | FOR 2,666,862.487 shares AGAINST 47,702.491 shares ABSTAIN 118,719.882 shares TOTAL 2,833,284.860 shares | 94.126% 1.684% 4.190% | ||
J.P. Morgan NVIT Balanced Fund (Formerly J.P. Morgan GVIT Balanced Fund) | FOR 15,966,867.546 shares AGAINST 259,004.324 shares ABSTAIN 1,339,385.200 shares TOTAL 17,565,257.070 shares | 90.900% 1.475% 7.625% | ||
Van Kampen NVIT Comstock Value Fund (Formerly Van Kampen GVIT Comstock Value Fund) | FOR 27,737,008.009 shares AGAINST 502,564.164 shares ABSTAIN 1,824,670.107 shares TOTAL 30,064,242.280 shares | 92.259% 1.672% 6.069% | ||
Van Kampen NVIT Multi Sector Bond Fund (Formerly Van Kampen GVIT Multi Sector Bond Fund) | FOR 21,253,297.665 shares AGAINST 484,100.920 shares ABSTAIN 1,803,963.645 shares TOTAL 23,541,362.230 shares | 90.281% 2.056% 7.663% | ||
At the April 25 Meeting, shareholders of the Nationwide NVIT Mid Cap Growth Fund were also asked to approve a new investment subadvisory agreement among the Adviser, the Trust and NorthPointe Capital LLC. The voting results with respect to that proposal are set forth below:
Proposal 2
Number of Shares | ||||
Fund | Cast/Not Cast | Percentages | ||
Nationwide NVIT Mid Cap Growth Fund (Formerly Gartmore GVIT Mid Cap Growth Fund) | FOR 10,862,827.499 shares AGAINST 414,574.660 shares ABSTAIN 672,570.741 shares TOTAL 11,949,972.900 shares | 90.903% 3.469% 5.628% | ||
* | This meeting was previously adjourned on April 23, 2007. | |
** | Fund names were changed effective May 1, 2007 to reflect “Nationwide”/ “NVIT” branding to coincide with the sale of Nationwide Fund Advisors, Inc. by Nationwide Corporation to its majority-owned subsidiary, Nationwide Financial Services, Inc. |
June 30, 2007 (Unaudited)
Contents | ||
6 | Statement of Investments | |
10 | Statement of Assets and Liabilities | |
11 | Statement of Operations | |
12 | Statements of Changes in Net Assets | |
13 | Financial Highlights | |
14 | Notes to Financial Statements |
Statement Regarding Availability of Proxy Voting Record.
SAR-DMKT (8/07) | ![]() |
Dear Fellow Shareholder:
Since I last wrote to you, our mutual funds have enjoyed another period of solid performance, and the corporate realignment that was in progress is now finished.
On May 1, 2007, Nationwide Financial Services, Inc. (NFS), completed its acquisition of the Philadelphia-based retail mutual fund operations of NWD Investment Management, Inc. (formerly, “Gartmore Global Investments, Inc.”), from Nationwide Corporation, a subsidiary of Nationwide Mutual Insurance Company. Effective that date, the acquired entities were renamed Nationwide Funds Group (NFG), and the Gartmore Funds were renamed the Nationwide Funds to better align with the Nationwide® brand. Although the corporate ownership and fund names have changed, I can assure you that NFG intends to maintain as much continuity as possible with the Funds and key personnel.
Thank you, shareholders, for approving the new investment advisory agreement that was required due to the change in corporate ownership. The new agreement is identical in all material respects to the original agreement that it replaces, with the exception of the section pertaining to the vote by the shareholders of the NVIT Mid Cap Growth Fund to approve NorthPointe Capital®, LLC (NorthPointe) as sub-adviser to that particular Fund.
Market Overview: January 1-June 30, 2007
Share prices in general were buoyed in part by better-than-expected first-quarter 2007 earnings and a flurry of mergers and acquisitions, many of these spurred by readily available funding from private equity firms. In June, investors grew more cautious amid surging crude oil prices, a sudden spike in long-term interest rates, and the meltdown of two hedge funds that had exposure to the subprime mortgage market. Looking abroad, a weak U.S. dollar aided foreign stocks, as reflected in the 11.09% advance of the Morgan Stanley Capital International Europe, Australasia and Far East (MSCI EAFE®) Index. Emerging market performance was particularly robust.
The bond market struggled during the first half of 2007. While short-term interest rates remained stable, reflecting the Federal Reserve Board’s decision in June to leave the target federal funds rate at 5.25%, longer-term rates climbed during the first half of 2007, depressing bond prices and forcing the Lehman Brothers® U.S. Aggregate Index to settle for a modest 0.97% return.
We at NFG thank you for your understanding and cooperation throughout our recent transition period. We emerge from this period energized for the future, and we look forward to serving your investment needs for a long time to come.
Nationwide Funds Group
PAST PERFORMANCE IS NO GUARANTEE OF FUTURE RESULTS.
Nationwide Funds are advised by Nationwide Fund Advisors (NFA). NFA is a wholly-owned subsidiary of Nationwide Financial Services. Nationwide Financial Services is a wholly-owned subsidiary of Nationwide Corporation. All of the common stock of Nationwide Corporation is held by Nationwide Mutual (95.2%) and Nationwide Mutual Fire Insurance Company (4.8%), each of which is a mutual company owned by its policyholders.
Nationwide Funds Group (NFG) is the mutual fund arm of Nationwide Financial Services (NYSE: NFS). Based in Conshohocken, Pa., a suburb of Philadelphia, NFG is comprised of Nationwide Fund Advisors, Nationwide Fund Distributors, LLC, and Nationwide Fund Management, LLC. Together, these provide advisory, distribution, and administration services respectively to the Nationwide Funds, and manage more than $43.5 billion in assets as of June 30, 2007, of which more than $12 billion are in “fund of funds” designed to provide asset allocation across several types of investments and asset classes.
Lehman Brothers (LB) U.S. Aggregate Index: An unmanaged, market value-weighted index of investment-grade, fixed-rate debt issues (including government, corporate, asset-backed, and mortgage-backed securities with maturities of one year or more) that is generally representative of the bond market as a whole.
Morgan Stanley Capital International Europe, Australasia and Far East (MSCI EAFE®) Index: An unmanaged, free float-adjusted, market capitalization-weighted index that is designed to measure the performance of stocks in developed markets outside the United States and Canada.
Standard & Poor’s 500® (S&P 500) Index: An unmanaged, market capitalization-weighted index of 500 widely held stocks of large-cap U.S. companies that gives a broad look at how the stock prices of those companies have performed.
Views expressed within are those of Nationwide Funds Group as of the date noted, are subject to change at any time, and may not come to pass.
This report is for informational purposes only, and is not intended as an offer or recommendation with respect to the purchase or sale of any security, option, future, or other derivatives in such securities.
Investing in mutual funds involves risk, including possible loss of principal.
Investors should carefully consider a fund’s investment objectives, risks, fees, charges, and expenses before investing any money. To obtain this and other fund information, please call 800-848-0920 to request a prospectus, or download a prospectus at www.nationwidefunds.com. Please read the prospectus carefully before investing any money.
Nationwide Funds distributed by Nationwide Fund Distributors LLC (formerly Gartmore Distribution Services, Inc.), Member NASD. 1200 River Road, Suite 1000, Conshohocken, Pa. 19428.
As a shareholder of the Fund, you incur two types of costs: (1) transaction costs, including sales charges (loads) paid on purchase payments and redemption fees; and (2) ongoing costs, including investment advisory fees, administration fees, distribution fees and other Fund expenses. The examples below are 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. Per SEC requirements, the examples assume that you had a $1,000 investment in the Class at the beginning of the reporting period, January 1, 2007, and continued to hold your shares at the end of the reporting period, June 30, 2007.
Actual Expenses
Hypothetical Example for Comparison Purposes
Please note that the expenses shown in the table are meant to highlight your ongoing costs only and do not reflect any transaction costs, such as sales charges (loads) or redemption fees. Therefore, the second line for each Class in 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 transaction costs were included, your costs would have been higher. The examples also assume all dividends and distributions have been reinvested.
Schedule of Shareholder Expenses
Beginning | Ending | |||||||||||||||||||||
Gartmore NVIT Developing | Account Value, | Account Value, | Expenses Paid | Annualized | ||||||||||||||||||
Markets Fund | January 1, 2007 | June 30, 2007 | During Period* | Expense Ratio* | ||||||||||||||||||
Class II | Actual | $ | 1,000.00 | $ | 1,195.20 | $ | 8.27 | 1.52% | ||||||||||||||
Hypothetical | 1 | $ | 1,000.00 | $ | 1,017.26 | $ | 7.63 | 1.52% | ||||||||||||||
* | Expenses are equal to the Fund’s annualized expense ratio multiplied by the average account value over the period multiplied by 181/365 (to reflect the one-half year period). The expense ratio presented represents a six-month, annualized ratio in accordance with SEC guidelines. The expenses reported above do not include the effect of additional expenses imposed by variable annuity contracts. | |
1 | Represents the hypothetical 5% return before expenses. |
Portfolio Summary June 30, 2007 | Gartmore NVIT Developing Markets Fund |
Asset Allocation | ||||
Common Stock | 92.9% | |||
Participation Notes | 4.7% | |||
Repurchase Agreements | 1.9% | |||
Foreign Bonds | 0.0% | |||
Other assets in excess of liabilities | 0.5% | |||
100.0% |
Top Holdings* | ||||
Samsung Electrical Co. Ltd. | 2.7% | |||
Companhia Vale do Rio Doce, Class A | 2.5% | |||
America Movil SA de CV ADR | 2.4% | |||
Hon Hai Precision Industry Co. Ltd. | 2.3% | |||
Gazprom ADR | 2.3% | |||
Lojas Renner SA | 2.2% | |||
Petroleo Brasileiro SA ADR | 2.2% | |||
Sberbank RF | 2.1% | |||
Bharti Tele-Ventures Ltd. | 2.1% | |||
China Mobile Ltd. | 2.0% | |||
Other | 77.2% | |||
100.0% |
Top Industries | ||||
Commercial Banks | 13.0% | |||
Oil, Gas & Consumable Fuels | 11.0% | |||
Metals & Mining | 10.9% | |||
Wireless Telecommunication Services | 9.2% | |||
Semiconductors & Semiconductor Equipment | 7.1% | |||
Insurance | 4.3% | |||
Construction & Engineering | 3.5% | |||
Multiline Retail | 2.9% | |||
Construction Materials | 2.8% | |||
Electric Utilities | 2.5% | |||
Other | 32.8% | |||
100.0% |
Top Countries | ||||
Republic of Korea | 15.7% | |||
Brazil | 13.7% | |||
Taiwan | 10.5% | |||
Russian Federation | 9.8% | |||
China | 8.5% | |||
Hong Kong | 7.3% | |||
South Africa | 6.6% | |||
Mexico | 6.6% | |||
India | 5.7% | |||
Malaysia | 3.7% | |||
Other | 11.9% | |||
100.0% |
* | For purpose of listing top holdings, repurchase agreements are included as part of Other. |
Gartmore NVIT Developing Markets Fund
Common Stock (92.9%) | ||||||||
Shares or | ||||||||
Principal Amount | Value | |||||||
ARGENTINA (1.0%) | ||||||||
Metals & Mining 1.0% | ||||||||
Tenaris SA ADR | 91,700 | $ | 4,489,632 | |||||
BRAZIL (13.7%) | ||||||||
Commercial Banks (2.3%) | ||||||||
Banco Bradesco SA, Preferred Shares | 190,792 | 4,604,539 | ||||||
Unibanco GDR | 46,300 | 5,225,881 | ||||||
9,830,420 | ||||||||
Insurance (1.1%) | ||||||||
Porto Seguro SA | 127,900 | 4,909,025 | ||||||
Metals & Mining (2.5%) | ||||||||
Companhia Vale do Rio Doce, Preferred Shares, Class A | 283,834 | 10,621,692 | ||||||
Multiline Retail (2.2%) | ||||||||
Lojas Renner SA | 510,200 | 9,473,631 | ||||||
Oil, Gas & Consumable Fuels (2.4%) | ||||||||
Petroleo Brasileiro SA | 30,600 | 930,062 | ||||||
Petroleo Brasileiro SA ADR | 77,634 | 9,414,675 | ||||||
10,344,737 | ||||||||
Paper & Forest Products (0.9%) | ||||||||
Aracruz Celulose SA ADR | 54,778 | 3,628,495 | ||||||
Telephones (1.1%) | ||||||||
Brasil Telecom Participacoes SA | 78,825 | 4,765,760 | ||||||
Transportation Infrastructure (1.2%) | ||||||||
Companhia de Consessoes Rodoviarias | 281,404 | 5,229,619 | ||||||
58,803,379 | ||||||||
CHINA (8.5%) | ||||||||
Commercial (Bank 0.9%) (a) | ||||||||
China Construction Bank, Class H | 5,446,000 | 3,745,072 | ||||||
Construction Materials (1.8%) (a) | ||||||||
Anhui Conch Cement Co. Ltd. | 1,122,200 | 7,889,963 | ||||||
Insurance (1.1%)(a) | ||||||||
Ping An Insurance (Group) Co. of China Ltd. | 646,000 | 4,563,762 | ||||||
Media (0.9%) | ||||||||
Focus Media Holding Ltd. ADR* | 76,100 | 3,843,050 | ||||||
Oil, Gas & Consumable Fuels (3.8%) (a) | ||||||||
China Petroleum & Chemical Corp. | 7,312,000 | 8,158,047 | ||||||
China Shenhua Energy Co. | 1,175,500 | 4,101,905 | ||||||
PetroChina Co. Ltd. | 2,865,000 | 4,255,675 | ||||||
16,515,627 | ||||||||
36,557,474 | ||||||||
CZECH REPUBLIC (1.5%) (a) | ||||||||
Electric Utility (1.5%) | ||||||||
CEZ AS | 123,700 | 6,366,210 | ||||||
HONG KONG (7.3%) | ||||||||
Multi-Utility (1.4%) (a) | ||||||||
China Resources Power Holdings Co. Ltd. | 2,551,800 | 6,098,185 | ||||||
Personal Products (0.7%) (a) | ||||||||
Hengan International Group Co. Ltd. | 862,000 | 3,065,252 | ||||||
Real Estate Management & Development (1.4%) | ||||||||
Country Garden Holdings Co.* | 971,000 | 819,629 | ||||||
Shimao Property Holdings Ltd.(a) | 2,378,900 | 5,321,887 | ||||||
6,141,516 | ||||||||
Textiles, Apparel & Luxury Goods (0.4%) (a) | ||||||||
Ports Design Ltd. | 533,500 | 1,500,736 | ||||||
Transportation (1.4%) (a) | ||||||||
Pacific Basin Shipping Ltd. | 5,099,000 | 5,733,162 | ||||||
Wireless Telecommunication Services (2.0%) (a) | ||||||||
China Mobile Ltd. | 806,300 | 8,675,334 | ||||||
31,214,185 | ||||||||
HUNGARY (0.9%) (a) | ||||||||
Oil, Gas & Consumable Fuels (0.9%) | ||||||||
MOL Magyar Olaj-es Gazipari | 26,500 | 3,995,811 | ||||||
INDIA (1.1%) | ||||||||
IT Services (1.1%) | ||||||||
Satyam Computer Services Ltd. ADR | 200,500 | 4,964,380 | ||||||
INDONESIA (1.7%) (a) | ||||||||
Automobiles (0.8%) | ||||||||
PT Astra International, Inc. | 1,863,000 | 3,497,729 | ||||||
Diversified Telecommunication Services (0.9%) | ||||||||
PT Telekomunikasi Indonesia | 3,471,456 | 3,767,882 | ||||||
7,265,611 | ||||||||
Common Stock (continued) | ||||||||
Shares or | ||||||||
Principal Amount | Value | |||||||
KAZAKHSTAN (0.7%) (a) | ||||||||
Oil, Gas & Consumable Fuels (0.7%) | ||||||||
Kazmunaigas Exploration Production GDR* | 148,200 | $ | 3,147,393 | |||||
MALAYSIA (3.7%) | ||||||||
Commercial Bank (1.4%) (a) | ||||||||
Bumiputra Commerce Holdings Berhad | 1,703,500 | 5,776,407 | ||||||
Food Products (1.2%) (a) | ||||||||
IOI Corporation Berhad | 3,360,300 | 5,075,034 | ||||||
Hotels, Restaurants & Leisure (0.9%) (a) | ||||||||
Genting Berhard | 1,669,600 | 3,998,220 | ||||||
Wireless Telecommunication Services (0.2%) | ||||||||
Maxis Communications Berhad | 218,100 | 986,191 | ||||||
15,835,852 | ||||||||
MEXICO (6.6%) | ||||||||
Commercial Bank (1.6%) | ||||||||
Grupo Financiero Banorte SA de CV | 1,493,434 | 6,840,240 | ||||||
Food & Staples Retailing (1.2%) | ||||||||
Wal-Mart de Mexico SA de CV | 1,300,800 | 4,936,851 | ||||||
Industrial Conglomerate (0.5%) | ||||||||
Grupo Carso SA de CV | 578,327 | 2,237,718 | ||||||
Metals & Mining (0.9%) | ||||||||
Industrias CH SA* | 797,900 | 3,685,570 | ||||||
Wireless Telecommunication Services (2.4%) | ||||||||
America Movil SA de CV ADR | 169,100 | 10,472,363 | ||||||
28,172,742 | ||||||||
POLAND (0.7%) (a) | ||||||||
Commercial Bank (0.7%) | ||||||||
Bank Zachodni WBK SA | 27,889 | 2,884,036 | ||||||
REPUBLIC OF KOREA (15.7%) | ||||||||
Airline (0.3%)(a) | ||||||||
Korean Air Lines Co. Ltd. | 23,700 | 1,345,154 | ||||||
Building Products (0.7%)(a) | ||||||||
KCC Corp. | 6,200 | 2,818,355 | ||||||
Chemicals (0.9%) (a) | ||||||||
LG Chem Ltd. | 43,495 | 3,669,897 | ||||||
Commercial Banks (1.9%) (a) | ||||||||
Industrial Bank of Korea | 305,600 | 6,224,539 | ||||||
Korea Exchange Bank | 116,490 | 1,732,762 | ||||||
7,957,301 | ||||||||
Construction & Engineering (3.0%) (a) | ||||||||
Hyundai Development Co. | 72,700 | 5,174,851 | ||||||
Hyundai Heavy Industries | 20,925 | 7,799,343 | ||||||
12,974,194 | ||||||||
Diversified Financial Services (0.7%) (a) | ||||||||
Shinhan Financial Group Ltd. | 51,484 | 3,134,890 | ||||||
Electronic Equipment & Instruments (0.0%) | ||||||||
Samsung Electronics Co. Ltd. GDR | 2 | 476 | ||||||
Insurance (1.0%) (a) | ||||||||
Samsung Fire & Marine Insurance Co. Ltd. | 21,267 | 4,095,608 | ||||||
Machinery (1.5%) (a) | ||||||||
Hanjin Heavy Industries & Construction Co. Ltd. | 90,810 | 6,441,760 | ||||||
Metals & Mining (2.3%) (a) | ||||||||
Korea Zinc Co. Ltd. | 16,451 | 2,793,739 | ||||||
POSCO | 14,990 | 7,199,186 | ||||||
9,992,925 | ||||||||
Multiline Retail (0.7%) | ||||||||
Lotte Shopping Co. Ltd. GDR | 163,551 | 3,176,160 | ||||||
Semiconductors & Semiconductor Equipment (2.7%) (a) | ||||||||
Samsung Electrical Co. Ltd. | 19,103 | 11,683,094 | ||||||
67,289,814 | ||||||||
RUSSIAN FEDERATION (9.8%) | ||||||||
Automobiles (0.9%) (a) | ||||||||
JSC Severstal-Avto | 115,180 | 3,887,325 | ||||||
Commercial Bank (2.1%) (a) | ||||||||
Sberbank RF | 2,307 | 8,914,025 | ||||||
Electric Utility (1.0%) | ||||||||
RAO Unified Energy System GDR* | 30,596 | 4,138,109 | ||||||
Metals & Mining (1.2%) | ||||||||
Chelyabinsk Zink Plant* | 4,300 | 645,000 | ||||||
Norilsk Nickel ADR | 21,000 | 4,662,000 | ||||||
5,307,000 | ||||||||
Gartmore NVIT Developing Markets Fund (Continued)
Common Stock (continued) | ||||||||
Shares or | ||||||||
Principal Amount | Value | |||||||
RUSSIAN FEDERATION (continued) | ||||||||
Oil, Gas & Consumable Fuels (3.2%) | ||||||||
Gazprom ADR | 235,700 | $ | 9,878,187 | |||||
Surgutneftegaz ADR | 72,574 | 3,962,540 | ||||||
13,840,727 | ||||||||
Real Estate Investment Trust (REIT) (0.1%) | ||||||||
AFI Development PLC GDR* | 40,081 | 452,915 | ||||||
Wireless Telecommunication Services (1.3%) | ||||||||
Mobile Telesystems ADR | 91,565 | 5,546,092 | ||||||
42,086,193 | ||||||||
SOUTH AFRICA (6.6%) (a) | ||||||||
Commercial Bank (1.0%) | ||||||||
ABSA Group Ltd. | 223,798 | 4,150,568 | ||||||
Food & Staples Retailing (0.5%) | ||||||||
Massmart Holdings Ltd. | 162,700 | 1,984,862 | ||||||
Health Care Providers & Services (0.9%) | ||||||||
Network Healthcare Holdings Ltd. | 1,912,600 | 3,899,717 | ||||||
Industrial Conglomerate (1.1%) | ||||||||
Barloworld Ltd. | 175,164 | 4,874,058 | ||||||
Metals & Mining (1.1%) | ||||||||
Anglo Platinum Ltd. | 29,003 | 4,769,717 | ||||||
Specialty Retail (0.8%) | ||||||||
Truworths International Ltd. | 685,600 | 3,532,052 | ||||||
Wireless Telecommunication Services (1.2%) | ||||||||
MTN Group Ltd. | 369,363 | 5,027,827 | ||||||
28,238,801 | ||||||||
TAIWAN (10.5%) | ||||||||
Computers & Peripherals (0.8%) (a) | ||||||||
Asustek Computer, Inc. | 1,245,500 | 3,425,898 | ||||||
Construction Materials (1.0%) (a) | ||||||||
Taiwan Cement Corp. | 3,667,835 | 4,250,062 | ||||||
Electronic Equipment & Instruments (2.3%) (a) | ||||||||
Hon Hai Precision Industry Co. Ltd. | 1,158,200 | 10,005,508 | ||||||
Insurance (1.1%)(a) | ||||||||
Shin Kong Financial Holding Co. Ltd. | 4,129,112 | 4,799,174 | ||||||
Semiconductors & Semiconductor Equipment (4.4%) | ||||||||
Advanced Semiconductor Engineering, Inc.*(a) | 3,101,000 | 4,218,423 | ||||||
MediaTek, Inc.(a) | 318,900 | 4,962,369 | ||||||
Taiwan Semiconductor Manufacturing Co. Ltd.(a) | 3,311,937 | 7,094,068 | ||||||
Taiwan Semiconductor Manufacturing Co. Ltd. ADR | 220,311 | 2,452,064 | ||||||
18,726,924 | ||||||||
Textiles, Apparel & Luxury Goods (0.9%) (a) | ||||||||
Formosa Taffeta Co. Ltd. | 3,627,000 | 3,970,808 | ||||||
45,178,374 | ||||||||
THAILAND (1.2%) | ||||||||
Metals & Mining (1.2%) | ||||||||
Banpu Public Co. Ltd. | 670,728 | 5,207,712 | ||||||
TURKEY (1.0%) (a) | ||||||||
Commercial Bank (1.0%) | ||||||||
Turkiye Vakiflar Bankasi | 1,658,975 | 4,234,341 | ||||||
VENEZUELA (0.7%) | ||||||||
Metals & Mining (0.7%) | ||||||||
Ternium SA | 106,300 | 3,219,828 | ||||||
Total Common Stocks (Cost $302,693,572) | 399,151,768 | |||||||
Foreign Bond (0.0%) (b) | ||||||||
Brazil (0.0%) | ||||||||
Metals & Mining (0.0%) | ||||||||
Comp Vale DO Rio Doce, 0.00%, 09/29/49 | $ | 20,000 | 0 | |||||
Participation Notes (4.7%) | ||||||||
INDIA (4.6%) | ||||||||
Chemicals (1.4%) | ||||||||
Reliance Industries Ltd., 0.00% 03/09/09* | 148,466 | $ | 6,199,940 | |||||
Construction & Engineering (0.5%) | ||||||||
Unitech Ltd., 0.00%, 07/08/10 | 166,164 | 2,058,772 | ||||||
Participation Notes (continued) | ||||||||
Shares or | ||||||||
Principal Amount | Value | |||||||
INDIA (continued) | ||||||||
Diversified Consumer Services (0.6%) | ||||||||
Max India Ltd., 0.00%, 07/12/10* | 434,745 | $ | 2,586,733 | |||||
Wireless Telecommunication Services (2.1%)(a) | ||||||||
Bharti Tele-Ventures Ltd., 0.00%, 01/24/07* | 427,682 | 8,780,311 | ||||||
19,625,756 | ||||||||
PAKISTAN (0.1%) | ||||||||
Commercial Bank (0.1%) | ||||||||
Muslim Commercial Bank Ltd. 0.00%, 09/22/09* | 103,700 | 626,348 | ||||||
Total Participation Notes (Cost $16,957,193) | 20,252,104 | |||||||
Repurchase Agreements (1.9%) | ||||||||
Nomura Securities, 5.20% dated 06/29/07, due 07/02/07, Repurchase price $8,126,867, collateralized by U.S. Government Agency Mortgages with a market value of $8,285,813 | $ | 8,123,346 | 8,123,346 | |||||
Total Investments (Cost $327,774,110) (c) — 99.5% | 427,527,218 | |||||||
Other assets in excess of liabilities — 0.5% | 2,065,569 | |||||||
NET ASSETS — 100.0% | $ | 429,592,787 | ||||||
* | Denotes a non-income producing security. | |
(a) | Fair Valued Security. | |
(b) | Variable Rate Security. The rate reflected in the Statement of Investments is the rate in effect on June 30, 2007. The maturity date represents the actual maturity date. | |
(c) | See notes to financial statements for tax unrealized appreciation (depreciation) of securities. |
ADR | American Depository Receipt | |
CH | Switzerland | |
GDR | Global Depository Receipt | |
MTN | Medium Term Note |
Gartmore NVIT | ||||||
Developing | ||||||
Markets Fund | ||||||
Assets: | ||||||
Investments, at value (cost $319,650,778) | $ | 419,403,872 | ||||
Repurchase agreements, at cost and value | 8,123,346 | |||||
Total Investments | 427,527,218 | |||||
Cash | 277,457 | |||||
Foreign currencies, at value (cost $1,644,041) | 1,642,109 | |||||
Interest and dividends receivable | 957,318 | |||||
Receivable for capital shares issued | 1,243,172 | |||||
Receivable for investments sold | 1,234,953 | |||||
Unrealized appreciation on spot contracts | 20,684 | |||||
Reclaims receivable | 7,939 | |||||
Prepaid expenses | 226,300 | |||||
Total Assets | 433,137,150 | |||||
Liabilities: | ||||||
Payable for investments purchased | 2,356,986 | |||||
Payable for capital shares redeemed | 2,161 | |||||
Accrued expenses and other payables: | ||||||
Investment advisory fees | 1,034,326 | |||||
Fund administration and transfer agent fees | 28,269 | |||||
Distribution fees | 84,510 | |||||
Compliance program costs | 4,004 | |||||
Other | 34,107 | |||||
Total Liabilities | 3,544,363 | |||||
Net Assets | $ | 429,592,787 | ||||
Represented by: | ||||||
Capital | $ | 305,354,922 | ||||
Accumulated net investment income | 479,857 | |||||
Accumulated net realized gains from investment transactions and foreign currency transactions | 23,993,668 | |||||
Net unrealized appreciation on investments and translation of assets and liabilities denominated in foreign currencies | 99,764,340 | |||||
Net Assets | $ | 429,592,787 | ||||
Net Assets: | ||||||
Class II Shares | $ | 429,592,787 | ||||
Shares outstanding (unlimited number of shares authorized): | ||||||
Class II Shares | $ | 26,618,252 | ||||
Net asset value and offering price per share (Net assets by class divided by shares outstanding by class, respectively.): | ||||||
Class II Shares | $ | 16.14 | ||||
10
Gartmore NVIT | |||||
Developing | |||||
Markets Fund | |||||
INVESTMENT INCOME: | |||||
Interest income | $ | 194,766 | |||
Dividend income | 4,232,556 | ||||
Foreign tax withholding | (326,009 | ) | |||
Total Income | 4,101,313 | ||||
Expenses: | |||||
Investment advisory fees | 1,897,597 | ||||
Fund administration and transfer agent fees | 114,350 | ||||
Distribution fees Class II Shares | 445,778 | ||||
Administrative servicing fees Class II Shares | 158,545 | ||||
Custodian fees | 27,009 | ||||
Trustee fees | 8,022 | ||||
Compliance program costs (Note 3) | 2,352 | ||||
Other | 51,556 | ||||
Total expenses before earnings credit | 2,705,209 | ||||
Earnings credit (Note 6) | (40 | ) | |||
Net Expenses | 2,705,169 | ||||
Net Investment Income | 1,396,144 | ||||
REALIZED/ UNREALIZED GAINS (LOSSES) FROM INVESTMENTS: | |||||
Net realized gains on investment transactions | 39,263,904 | ||||
Net realized losses on foreign currency transactions | (72,570 | ) | |||
Net realized gains on investment transactions and foreign currency transactions | 39,191,334 | ||||
Net change in unrealized appreciation on investments and translation of assets and liabilities denominated in foreign currencies | 20,992,287 | ||||
Net realized/unrealized gains (losses) on investments and translation of assets and liabilities denominated in foreign currencies | 60,183,621 | ||||
CHANGE IN NET ASSETS RESULTING FROM OPERATIONS | $ | 61,579,765 | |||
11
Gartmore NVIT Developing | |||||||||
Markets Fund | |||||||||
Six Months Ended | Year Ended | ||||||||
June 30, 2007 | December 31, 2006 | ||||||||
(Unaudited) | |||||||||
FROM INVESTMENT ACTIVITIES: | |||||||||
Operations: | |||||||||
Net investment income | $ | 1,396,144 | $ | 1,902,269 | |||||
Net realized gains on investment transactions and foreign currency transactions | 39,191,334 | 59,782,113 | |||||||
Net change in unrealized appreciation on investments and translation of assets and liabilities denominated in foreign currencies | 20,992,287 | 26,140,026 | |||||||
Change in net assets resulting from operations | 61,579,765 | 87,824,408 | |||||||
Distributions to shareholders from: | |||||||||
Net investment income: | |||||||||
Class II | (916,287 | ) | (1,897,486 | ) | |||||
Net realized gains: | |||||||||
Class II | (57,603,336 | ) | (27,353,923 | ) | |||||
Change in net assets from shareholder distributions | (58,519,623 | ) | (29,251,409 | ) | |||||
Change in net assets from capital transactions | 62,299,255 | (7,391,212 | ) | ||||||
Change in net assets | 65,359,397 | 51,181,787 | |||||||
Net Assets: | |||||||||
Beginning of period | 364,233,390 | 313,051,603 | |||||||
End of period | $ | 429,592,787 | $ | 364,233,390 | |||||
Accumulated net investment income at end of period | $ | 479,857 | $ | – | |||||
CAPITAL TRANSACTIONS: | |||||||||
Class II Shares | |||||||||
Proceeds from shares issued | $ | 97,848,307 | $ | 186,785,562 | |||||
Dividends reinvested | 58,519,612 | 29,251,395 | |||||||
Cost of shares redeemed | (94,068,664 | ) | (223,428,169 | ) | |||||
Change in net assets from capital transactions | $ | 62,299,255 | $ | (7,391,212 | ) | ||||
SHARE TRANSACTIONS: | |||||||||
Class II Shares | |||||||||
Issued | 5,852,676 | 12,880,559 | |||||||
Reinvested | 3,669,125 | 2,483,481 | |||||||
Redeemed | (6,131,937 | ) | (16,135,650 | ) | |||||
Total change in shares | 3,389,864 | (771,610 | ) | ||||||
12
Distributions | ||||||||||||||||||||
Investment Activities | ||||||||||||||||||||
Net Realized | ||||||||||||||||||||
and | ||||||||||||||||||||
Net Asset | Unrealized | Total | ||||||||||||||||||
Value, | Net | Gains | from | Net | ||||||||||||||||
Beginning | Investment | (Losses) on | Investment | Investment | ||||||||||||||||
of Period | Income | Investments | Activities | Income | ||||||||||||||||
Class II Shares | ||||||||||||||||||||
For the year ended December 31, 2002 | $ | 7.22 | 0.03 | (0.73 | ) | (0.70 | ) | (0.01 | ) | |||||||||||
For the year ended December 31, 2003 (e) | $ | 6.51 | 0.06 | 3.83 | 3.89 | (0.01 | ) | |||||||||||||
For the year ended December 31, 2004 | $ | 10.39 | 0.07 | 1.90 | 1.97 | (0.06 | ) | |||||||||||||
For the year ended December 31, 2005 | $ | 11.83 | 0.07 | 3.17 | 3.24 | (0.07 | ) | |||||||||||||
For the year ended December 31, 2006 | $ | 13.04 | 0.08 | 3.96 | 4.04 | (0.08 | ) | |||||||||||||
For the six months ended June 30, 2007 (Unaudited) | $ | 15.68 | 0.06 | 2.96 | 3.02 | (0.04 | ) | |||||||||||||
[Additional columns below]
[Continued from above table, first column(s) repeated]
Distributions | ||||||||||||||||||||||||
Ratio of | ||||||||||||||||||||||||
Net Assets | Expenses | |||||||||||||||||||||||
Net | Net Asset | at End of | to Average | |||||||||||||||||||||
realized | Total | Value, End | Total | Period | Net | |||||||||||||||||||
gains | Distributions | of Period | Return(a) | (000s) | Assets(b) | |||||||||||||||||||
Class II Shares | ||||||||||||||||||||||||
For the year ended December 31, 2002 | – | (0.01 | ) | $ | 6.51 | (9.68)% | $ | 75,321 | 1.60% | |||||||||||||||
For the year ended December 31, 2003 (e) | – | (0.01 | ) | $ | 10.39 | 59.70% | $ | 165,601 | 1.64% | |||||||||||||||
For the year ended December 31, 2004 | (0.47 | ) | (0.53 | ) | $ | 11.83 | 19.78% | $ | 194,898 | 1.78% | ||||||||||||||
For the year ended December 31, 2005 | (1.96 | ) | (2.03 | ) | $ | 13.04 | 31.52% | $ | 313,052 | 1.77% | ||||||||||||||
For the year ended December 31, 2006 | (1.32 | ) | (1.40 | ) | $ | 15.68 | 34.57% | $ | 364,233 | 1.65% | ||||||||||||||
For the six months ended June 30, 2007 (Unaudited) | (2.52 | ) | (2.56 | ) | $ | 16.14 | 19.52% | $ | 429,593 | 1.52% | ||||||||||||||
[Additional columns below]
[Continued from above table, first column(s) repeated]
Ratios/Supplemental Data | ||||||||||||||||||
Ratio of Net | ||||||||||||||||||
Ratio of | Investment | |||||||||||||||||
Ratio of Net | Expenses | Income | ||||||||||||||||
Investment | (Prior to | (Prior to | ||||||||||||||||
Income | Reimbursements) | Reimbursements) | ||||||||||||||||
to Average | to Average | to Average | Portfolio | |||||||||||||||
Net Assets(b) | Net Assets(b)(c) | Net Assets(b)(c) | Turnover(d) | |||||||||||||||
Class II Shares | ||||||||||||||||||
For the year ended December 31, 2002 | 0.44% | 1.68% | 0.36% | 97.00% | ||||||||||||||
For the year ended December 31, 2003 (e) | 0.75% | 1.80% | 0.60% | 167.45% | ||||||||||||||
For the year ended December 31, 2004 | 0.69% | (f) | (f) | 167.98% | ||||||||||||||
For the year ended December 31, 2005 | 0.49% | (f) | (f) | 157.77% | ||||||||||||||
For the year ended December 31, 2006 | 0.57% | (f) | (f) | 133.28% | ||||||||||||||
For the six months ended June 30, 2007 (Unaudited) | 0.78% | 1.52% | 0.78% | 48.47% | ||||||||||||||
(a) | Not annualized for periods less than one year. | |
(b) | Annualized for periods less than one year. | |
(c) | During the period, certain fees were waived and/or reimbursed. If such waivers/reimbursements had not occurred, the ratios would have been as indicated. | |
(d) | Portfolio turnover is calculated on the basis of the Fund as a whole without distinguishing among the classes of shares. | |
(e) | Upon reorganization on June 23, 2003, the existing shares of the Fund were designated Class II shares. | |
(f) | There were no fee reductions during the period. |
See accompanying notes to financial statements.
1. Organization
Nationwide Variable Insurance Trust (“NVIT” or the “Trust”) is an open-end management investment company, organized under the laws of Delaware by an amended and restated Agreement and Declaration of Trust, dated October 28, 2004, as amended to date. Prior to May 1, 2007, the Trust was named “Gartmore Variable Insurance Trust”. The Trust, originally created under the laws of Massachusetts as a Massachusetts business trust pursuant to a Declaration of Trust dated, as of June 30, 1981, and as subsequently amended, redomesticated as a Delaware Statutory Trust after the close of trading on April 29, 2005, and is registered under the Investment Company Act of 1940, as amended (the “1940 Act”). The redomestication was a change in statutory status and did not affect the operations of the Trust. As of June 30, 2007, the Trust had authorized an unlimited number of shares of beneficial interest, without par value (“shares”). The Trust currently offers shares to life insurance company separate accounts to fund the benefits under variable life insurance or annuity policies. To date, the separate accounts of American Skandia Life Insurance Corporation, Peoples Benefit Life Insurance Company, a subsidiary of Aegon, Canada Life Assurance Company, Transamerica Financial Life Insurance Company, Fortis Benefits, and First Great West Life & Annuity Insurance Company have purchased shares of the Gartmore NVIT Developing Markets Fund (the “Fund”), (formerly, “Gartmore GVIT Developing Markets Fund”). The Trust currently operates forty (40) separate series, or mutual funds, each with its own investment objectives and strategies. This report contains the financial statements and financial highlights of the Fund.
2. Summary of Significant Accounting Policies
The following is a summary of significant accounting policies followed by the Fund in the preparation of its financial statements. The policies are in conformity with accounting principles generally accepted in the United States of America (“GAAP”). The preparation of financial statements requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of income and expenses for the period. Actual results could differ from those estimates.
(a) | Security Valuation |
Securities for which market quotations are readily available are valued at current market value as of “Valuation Time.” Valuation Time is as of the close of regular trading on the New York Stock Exchange (usually 4 p.m. Eastern time). Equity securities are valued at the last quoted sale price or, if there is no sale price, the last quoted bid price provided by an independent pricing service approved by the Trust’s Board of Trustees (“Board of Trustees”). Securities traded on NASDAQ are valued at the NASDAQ official closing price. Prices are taken from the primary market or exchange in which each security trades. | |
Most securities listed on a foreign exchange are valued either at fair value (see description below) or at the last sale price at the close of the exchange on which the security is principally traded. Foreign securities, currencies, and other assets and liabilities denominated in foreign currencies are translated into U.S. dollars at the exchange rate of said currencies against the U.S. dollar, as of Valuation Time, as provided by an independent pricing service approved by the Board of Trustees. | |
Debt (including defaulted issues) and other fixed income securities (other than short-term obligations) are valued at the last quoted bid price and/or by using a combination of daily quotes and matrix evaluations provided by an independent pricing service, the use of which has been approved by the Board of Trustees. Short-term debt securities, such as commercial paper and U.S. Treasury Bills having a remaining maturity of 60 days or less at the time of purchase, are considered to be “short-term” and are valued at amortized cost, which approximates market value. | |
Securities for which market quotations are not readily available, or for which an independent pricing service does not provide a value or provides a value that does not represent fair value in the judgment of the Fund’s investment adviser or designee, are valued at fair value under procedures approved by the Board of Trustees. The “Fair Value” of these securities is determined in good faith by taking into account relevant factors and surrounding circumstances. Methods utilized to obtain a “Fair Value” may include the following non-exclusive list of acceptable methods: (i) a |
multiple of earnings; (ii) the discount from market value of a similar, freely traded security; (iii) the yield-to-maturity for debt issues; or (iv) a consolidation of the methods. The Trust’s Valuation & Operations Committee considers a non-exclusive list of factors to arrive at the appropriate method of determining “Fair Value.” For example, fair value determinations are required for securities whose value is affected by a “significant” event that materially affects the value of a domestic or foreign security which occurs subsequent to the time of the close of the principal market on which such domestic or foreign security trades and before the Valuation Time (i.e., a “subsequent event”). Typically, this will involve events occurring after the close of a foreign market on which a security trades and before the next Valuation Time. | |
The Fund values foreign securities at fair value in the circumstances described below. Generally, trading in foreign securities markets is completed each day at various times prior to the Valuation Time. Due to the time differences between the closings of the relevant foreign securities exchanges and the Valuation Time for the Fund, the Fund will fair value its foreign investments when it is determined that the market quotations for the foreign investments either are not readily available or are unreliable and, therefore, do not represent fair value. When the fair value prices are utilized, these prices will attempt to reflect the impact of the U.S. financial markets’ perceptions and trading activities on the Fund’s foreign investments since the last closing prices of the foreign investments were calculated on their primary foreign securities markets or exchanges. For these purposes, the Board of Trustees has determined that movements in relevant indices or other appropriate market indicators, after the close of the foreign securities exchanges, may demonstrate that market quotations are unreliable, and may trigger fair value pricing for certain securities. Consequently, fair valuation of portfolio securities may occur on a daily basis. |
(b) | Repurchase Agreements |
The Fund may enter into repurchase agreements with an entity which is a member of the Federal Reserve System or which is a “primary dealer” (as designated by the Federal Reserve Bank of New York) in U.S. Government obligations. The repurchase price generally equals the price paid by the Fund plus interest negotiated on the basis of current short-term rates, which may be more or less than the rate on the underlying portfolio securities. The seller under a repurchase agreement is required to maintain the value of the collateral held pursuant to the agreement at a market value equal to or greater than the repurchase price (including accrued interest). Collateral subject to repurchase agreements is held by the Fund’s custodian or another qualified sub-custodian or in the Federal Reserve/ Treasury book-entry system. If the counterparty defaults and the fair value of the collateral declines, realization of the collateral by the Fund may be delayed or limited. The Fund may transfer uninvested cash balances into a pooled cash account. These balances are invested in one or more repurchase agreements, with the counterparty of Nomura Securities, which is fully collateralized by U.S. Government Agency Mortgages. |
(c) | Forward Foreign Currency Contracts |
The Fund may enter into forward foreign currency contracts in connection with planned purchases or sales of securities or to hedge the U.S. dollar value of portfolio securities denominated in a particular currency. The Fund could be exposed to risks if the counterparties to the contracts are unable to meet the terms of their contracts and from unanticipated movements in the value of a foreign currency relative to the U.S. dollar. Forward foreign currency contracts are valued at the current cost of covering these contracts, as provided by an independent pricing service approved by the Board of Trustees. The forward foreign currency contracts are adjusted by the daily exchange rate of the underlying currency and any gains or losses are recorded for financial statement purposes as unrealized gains or losses until the contract settlement date. |
(d) | Foreign Currency Transactions |
The accounting records of the Fund are maintained in U.S. dollars. Foreign currency amounts are translated into U.S. dollars at the current rate of exchange to determine the value of investments, assets and liabilities. The Fund may enter into foreign currency contracts in connection with purchases or sales of securities denominated in a foreign currency. Purchases and sales of securities, and income and expenses, are translated at the prevailing rate of exchange |
on the respective date of these transactions. The Fund does not isolate that portion of the results of operations resulting from changes in foreign exchange rates on investments from fluctuations arising from changes in market prices of securities held. These fluctuations are included with the net realized and unrealized gain or loss from investments and foreign currencies. |
(e) | Futures Contracts |
The Fund may invest in financial futures contracts (“futures contracts”) for the purpose of hedging its existing portfolio securities or securities that the Fund intends to purchase against fluctuations in value caused by changes in prevailing market interest rates or prices. Futures contracts may also be entered into for non-hedging purposes. | |
Upon entering into a futures contract, the Fund is required to pledge to the broker an amount of cash and/or other assets equal to a certain percentage of the contract amount (initial margin deposit). Subsequent payments, known as “variation margin,” are made each day, depending on the daily fluctuations in the fair value/market value of the underlying assets. A gain or loss equal to the daily variation margin is recognized on a daily basis. Futures contracts are valued daily at their last quoted sale price. | |
A “sale” of a futures contract means the creation of a contractual obligation to deliver the securities or foreign currency called for by the contract at a fixed price at a specified time in the future. A “purchase” of a futures contract means the creation of a contractual obligation to acquire the securities or foreign currency at a fixed price at a specified time in the future. | |
Should market conditions change unexpectedly, the Fund may not achieve the anticipated benefits of the futures contracts and may realize a loss. The use of futures transactions for hedging purposes involves the risk of imperfect correlation in movements in the price of futures contracts, interest rates, and the value of the underlying hedged assets. |
(f) | Written Options Contracts |
The Fund may write options contracts. A written option obligates the Fund to deliver (written call) or to receive (written put) a specified quantity of an underlying asset at the contract amount upon exercise by the holder of the option. When the Fund writes an option, an amount equal to the premium received by the Fund is recorded as a liability and is subsequently adjusted to the current fair value of the option written. Premiums received from writing options that expire unexercised are treated by the Fund on the expiration date as realized gains from investments. The difference between the premium and the amount paid on effecting a closing purchase transaction, as a realized loss. If a call option is exercised, the premium is added to the proceeds from the sale of the underlying security or currency in determining whether the Fund has realized a gain or loss. If a put option is exercised, the premium reduces the cost basis of the securities purchased by the Fund. Options traded on an exchange are valued at the last quoted sale price, or in the absence of a sale, the bid price provided by an independent pricing service approved by the Board of Trustees. Non-exchange traded options are valued using dealer supplied quotes. The Fund as a writer of an option bears the market risk of an unfavorable change in the price of the security underlying the written option. |
(g) | Security Transactions and Investment Income |
Security transactions are accounted for on the date the security is purchased or sold (“trade date”). Securities gains and losses are calculated on the identified cost basis. Interest income is recognized on the accrual basis and includes, where applicable, the amortization or accretion of premium or discount. Dividend income is recorded on the ex-dividend date. |
(h) | Securities Lending |
To generate additional income, the Fund may lend its portfolio securities, up to 33 1/3% of the Fund, to brokers, dealers and other financial institutions provided that (1) the borrower delivers cash or securities as collateral with respect to each new loan of U.S. securities, equal to at least 102% of the value of the portfolio securities loaned, and |
with respect to each new loan on non-U.S. securities, collateral of at least 105% of the value of the portfolio securities loaned; and (2) at all times thereafter shall require the borrower to mark-to-market the collateral on a daily basis so that the market value of such collateral does not fall below 100% of the value of securities loaned. The Fund receives payments from borrowers equivalent to the dividends and interest that would have been earned on securities loaned while simultaneously seeking to earn income on the investment of cash collateral. There may be risks of delay in recovery of the securities should the borrower of the securities fail financially. Loans will be made, however, only to borrowers deemed by the Fund’s investment adviser to be of good standing and creditworthy under guidelines established by the Board of Trustees and when, in judgment of the adviser, the consideration which can be earned currently from these securities loans justifies the attendant risks. Loans are subject to termination by the Fund or the borrower at any time, and, therefore, are not considered to be illiquid investments. JPMorgan Chase Bank serves as custodian for the securities lending program of the Fund. JPMorgan Chase Bank receives a fee based on the value of the collateral received from borrowers. As of June 30, 2007, the Fund did not have securities on loan. |
(i) | Distributions to Shareholders |
The Fund’s dividends from net investment income, if any, are declared and paid quarterly. The Fund’s distributions from net realized capital gains, if any, are declared and distributed at least annually. | |
Dividends and distributions to shareholders are determined in accordance with federal income tax regulations, which may differ from GAAP. These “book/tax” differences are considered either permanent or temporary in nature. In accordance with the American Institute of Certified Public Accountants Statement of Position 93-2, permanent differences (i.e., reclassification of market discounts, foreign exchange gain/loss, paydowns, and distributions from real estate investment trusts) are reclassified within the capital accounts based on their nature for federal income tax purposes; temporary differences do not require reclassification. These reclassifications have no effect upon the net asset value of the Fund. To the extent distributions exceed current and accumulated earnings and profits for federal income tax purposes, these distributions are reported as distributions of paid-in-capital. |
(j) | Federal Income Taxes |
It is the policy of the Fund to qualify or to continue to qualify as a “regulated investment company” by complying with the provisions available to certain investment companies, as defined in Subchapter M of the U.S. Internal Revenue Code, and to make distributions of net investment income and net realized capital gains sufficient to relieve the Fund from all, or substantially all, federal income taxes. | |
As of June 30, 2007, the tax cost of securities and the breakdown of unrealized appreciation (depreciation) for the Fund was as follows: |
Net Unrealized | ||||||||||||||||
Tax Cost of | Unrealized | Unrealized | Appreciation | |||||||||||||
Securities | Appreciation | Depreciation | (Depreciation) | |||||||||||||
$ | 329,854,397 | $ | 100,420,009 | $ | (2,747,171 | ) | $ | 97,672,838 | ||||||||
(k) | Allocation of Expenses, Income, and Gains and Losses |
Expenses directly attributable to the Fund are charged to the Fund. Expenses not directly attributable to the Fund are allocated proportionately among various or all funds within the Trust. The method used by the Fund for allocating income, fund level expenses, and realized and unrealized gains or losses is based on the fair value of shares outstanding relative to net assets. Under this method, each class of shares participates based on the total net asset value of that class’s shares in proportion to the total net assets of the Fund. Expenses specific to a class (such as Rule 12b-1 and administrative services fees) are charged to that class. |
3. Transactions with Affiliates
Under the terms of the Trust’s Investment Advisory Agreement, Nationwide Fund Advisors (formerly, Gartmore Mutual Fund Capital Trust (“GMF”)) (“NFA” or the “Advisor”) manages the investment of the assets and supervises the daily business affairs of the Fund. NFA is a wholly-owned subsidiary of Nationwide Financial Services (“NFS”). In addition, NFA provides investment management evaluation services in initially selecting and monitoring, on an ongoing basis, the performance of the subadviser for the Fund. Gartmore Global Partners (the “subadviser”) manages all of the Fund’s investments and has the responsibility for making all investment decisions for the Fund.
Under the terms of the Investment Advisory Agreement, the Fund pays the Fund’s adviser an investment advisory fee based on the Fund’s average daily net assets. Additional information regarding investment advisory fees and subadvisory fees for NFA and the subadviser is as follows for the six months ended June 30, 2007:
Base Management Fee | Total Fees | |||||
Up to $500 million | 1.05 | % | ||||
$500 million up to $2 billion | 1.00 | % | ||||
$2 billion or more | 0.95 | % | ||||
From such fees, pursuant to the subadvisory agreement, NFA paid the subadviser $961,458 for the six months ended June 30, 2007.
The Fund’s base management fee (as adjusted for any applicable breakpoints) may increase or decrease proportionately depending on how the Fund performs relative to its benchmark, the MSCI Emerging Markets Free Index. This performance fee is intended to reward or penalize the investment adviser for outperforming or underperforming the Fund’s benchmark.
The calculation of the total management fee is done in two separate steps. First, the Fund calculates a base fee (to be paid at the end of each quarter). The base fee rate results in an annual fee, calculated and accrued daily. The fee rate is applied to the Fund’s average net assets over that quarter. Second, a performance adjustment percentage is applied to the Fund’s average net assets over the 12-month rolling performance period. The performance adjustment amount is then added to (or subtracted from, as applicable) the base fee to arrive at the Fund’s total advisory fee for the most recently completed quarterly sub-period and that total fee is paid at the end of that most recently completed quarter.
The performance fee calculation applies to all of the Fund’s share classes equally, based on the performance of the Class II shares during the performance period. The table below shows the performance adjustment rate applicable to the Fund’s base fee.
Out or Underperformance | Change in Fees | |||||
+/- 1 percentage point | +/-0.02% | |||||
+/- 2 percentage point | +/-0.04% | |||||
+/- 3 percentage point | +/-0.06% | |||||
+/- 4 percentage point | +/-0.08% | |||||
+/- 5 percentage point | +/-0.10% | |||||
The performance adjusted advisory fee will be paid quarterly.
Under this performance fee arrangement, the investment adviser can receive a performance fee increase even if the Fund experiences negative performance that still exceeds its benchmark by more than the relevant percentage amount shown above.
NFA and the Fund have entered into a written contract (“Expense Limitation Agreement”) that limits operating expenses (excluding any taxes, interest, brokerage fees, Rule 12b-1 fees, short-sale dividend expenses, administrative services fees, other expenses which are capitalized in accordance with generally accepted accounting principles and may exclude other
NFA may request and receive reimbursement from the Fund of the advisory fees waived and other expenses reimbursed by NFA, respectively, pursuant to the Expense Limitation Agreement at a later date not to exceed three years from the fiscal year in which the corresponding reimbursement to the Fund was made, (as described below), if the Fund has reached a sufficient asset size to permit reimbursement to be made without causing the total annual operating expense ratio of the Fund to exceed the limits set forth above. No reimbursement will be made unless: (i) the Fund’s assets exceed $100 million; (ii) the total annual expense ratio of the Class making such reimbursement is less than the limit set forth above; and (iii) the payment of such reimbursement is approved by the Board of Trustees on a quarterly basis. Except as provided for in the Expense Limitation Agreement, reimbursement of amounts previously waived or assumed by NFA is not permitted.
As of the six months ended June 30, 2007, there were no reimbursements for the Fund.
Under the terms of a Fund Administration and Transfer Agency Agreement, Nationwide Fund Management, LLC (formerly, Gartmore Investor Services, Inc. (“GISI”)) (“NFM”), a wholly-owned subsidiary of NFS Distributors, Inc. (“NFSDI”), provides the Fund with various administrative and accounting services for the Fund (prior to May 1, 2007, this service was provided by Gartmore SA Capital Trust (“GSA”)), and serves as Transfer and Dividend Disbursing Agent for the Fund (prior to May 1, 2007, this service was provided by GISI, an indirect subsidiary of GSA). The fees for the services provided under this Agreement are calculated based on the Trust’s average daily net assets according to the fee schedule below. The fees are then allocated proportionately among all funds within the Trust in relation to the average daily net assets of each fund and are paid to NFA. NFA pays NFM from these fees for NFM’s services.
Combined Fee Schedule* | ||||||
Up to $1 billion | 0.15% | |||||
$1 billion up to $3 billion | 0.10% | |||||
$3 billion up to $8 billion | 0.05% | |||||
$8 billion up to $10 billion | 0.04% | |||||
$10 billion up to $12 billion | 0.02% | |||||
$12 billion or more | 0.01% | |||||
* | The assets of the Nationwide NVIT Investor Destinations Aggressive Fund, the Nationwide NVIT Investor Destinations Moderately Aggressive Fund, the Nationwide NVIT Investor Destinations Moderate Fund, the Nationwide NVIT Investor Destinations Moderately Conservative Fund, and the Nationwide NVIT Investor Destinations Conservative Fund (collectively, the “Investor Destinations Funds”) are excluded from the Trust asset level amount in order to calculate this asset-based fee. The Investor Destinations Funds do not pay any part of this fee. |
NFA and NFM have entered into agreements with Citi Fund Services Ohio, Inc. (“Citi”), pursuant to which Citi provides sub-administration and sub-transfer agency services, respectively, to the Fund. Effective August 1, 2007, The BISYS Group Inc. was acquired by and became a wholly owned subsidiary of Citi.
Under the terms of a Distribution Plan under Rule 12b-1 of the 1940 Act, Nationwide Fund Distributors, LLC. (formerly, “Gartmore Distribution Services, Inc. (“GDSI”)) (“NFD” or “Distributor”), the Fund’s principal underwriter, is compensated by the Fund for expenses associated with the distribution of the Class II shares of the Fund. NFD is a wholly-owned subsidiary of NFSDI. These fees are based on average daily net assets of Class II shares of the Fund at an annual rate not to exceed 0.25%.
Under the terms of an Administrative Services Plan, the Fund may pay fees to servicing organizations, such as broker-dealers, including NFS, and financial institutions, which agree to provide administrative support services to the shareholders of certain classes. These services include, but are not limited, to the following: establishing and maintaining shareholder accounts; processing purchase and redemption transactions; arranging bank wires; performing shareholder
For the six months ended June 30, 2007, there were no Administrative Services Fees paid to Nationwide from the Fund.
Under the terms of a letter agreement dated September 12, 2006, by and among NFA, the Audit Committee of the Trust and the Trust, the Trust has agreed to reimburse NFA certain costs related to the Fund’s portion of ongoing administration, monitoring and annual (audit) testing of the Trust’s Rule 38a-1 Compliance Program subject to the pre-approval of the Trust’s Audit Committee. For the six months ended June 30, 2007, the Fund’s portion of such costs amounted to $2,352.
4. Investment Transactions
For the six months ended June 30, 2007, (excluding short-term securities) the Fund had purchases of $173,790,650 and sales of $173,934,024.
5. Bank Loans and Earnings Credit
The Trust has a credit agreement with JPMorgan Chase & Co., the Fund’s custodian bank, permitting the Trust to borrow up to $100,000,000. Borrowings under this arrangement bear interest at the Federal Funds rate plus 0.50%. The interest costs, if any, would be included in other fees in the Statement of Operations. No compensating balances were required under the terms of the line of credit. The line of credit is renewed annually, expiring on June 25, 2008, with a commitment fee of 0.07% per year on $100,000,000. There were no borrowings outstanding under this line of credit for the six months ended June 30, 2007.
The Trust’s custodian bank has agreed to reduce the bank’s fees (earnings credit) when the funds of the Trust maintain cash on deposit in non-interest-bearing custody and Demand Deposit Accounts. Earnings credits, if any, are shown as a reduction of total expenses on the Statement of Operations.
6. Portfolio Investment Risks
Risks Associated with Foreign Securities and Currencies. Investments in securities of foreign issuers carry certain risks not ordinarily associated with investments in securities of U.S. issuers. These risks include future political and economic developments, and the possible imposition of exchange controls or other foreign governmental laws and restrictions. In addition, with respect to certain countries, there is the possibility of expropriation of assets, confiscatory taxation, political or social instability, or diplomatic developments, which could adversely affect investments in those countries.
Certain countries also may impose substantial restrictions on investments in their capital markets by foreign entities, including restrictions on investments in issuers of industries deemed sensitive to relevant national interests. These factors may limit the investment opportunities available and result in a lack of liquidity and high price volatility with respect to securities of issuers from developing countries.
Credit and Market Risk. The Fund invests in emerging market instruments that are subject to certain additional credit and market risks. The yields of emerging market debt obligations reflect, among other things, perceived credit risk. The Fund’s investment in securities rated below investment grade typically involve risks not associated with higher rated securities including, among others, greater risk of not receiving timely and/or ultimate payment of interest and principal, greater market price volatility, and less liquid secondary market trading. The consequences of political, social, economic, or diplomatic changes may have disruptive effects on the market prices of emerging markets investments held by the Fund.
7. Indemnifications
Under the Trust’s organizational documents, certain of the Trust’s Officers and Trustees are indemnified against certain liabilities arising out of the performance of their duties to the Trust. In addition, the Trust has entered into Indemnification Agreements with the Trust’s trustees and certain officers covering similar liabilities. Trust Officers receive
8. Recently Issued Accounting Pronouncements
On July 13, 2006, the Financial Accounting Standards Board (“FASB”) released FASB Interpretation No. 48, Accounting for Uncertainty in Income Taxes (“FIN 48”). FIN 48 provides guidance for how uncertain tax positions should be recognized, measured, presented and disclosed in the financial statements. FIN 48 requires the affirmative evaluation of tax positions taken or expected to be taken in the course of preparing the Fund’s tax returns to determine whether it is more-likely-than-not (i.e., greater than 50 percent) that each tax position will be sustained upon examination by a taxing authority based on the technical merits of the position. A tax position that meets the more-likely-than-not recognition threshold is measured to determine the amount of benefit to recognize in the financial statements. Differences between tax positions taken in a tax return and amounts recognized in the financial statements will generally result in an increase in a liability for taxes payable (or a reduction of a tax refund receivable) and an increase in a deferred tax liability (or a reduction in a deferred tax asset). Adoption of FIN 48 was required no later than the last business day of the first financial statement reporting period for fiscal years beginning after December 15, 2006 and is to be applied to all open tax years as of the effective date. Accordingly, the Fund was required to implement FIN 48 in its net asset value per share (NAV) calculation on June 29, 2007. Management has evaluated the implications of FIN 48 and has concluded that there was no impact to the Fund’s financial statements as of June 29, 2007. The adoption of FIN 48 requires ongoing monitoring and analysis, future conclusions reached by management may be different and result in adjustments to the Fund’s NAV and financial statements.
In September 2006, the FASB issued Statement on Financial Accounting Standards (“SFAS”) No. 157, “Fair Value Measurements.” This standard establishes a single authoritative definition of fair value, sets out a framework for measuring fair value and requires additional disclosures about fair value measurements. SFAS No. 157 applies to fair value measurements already required or permitted by existing standards. SFAS No. 157 is effective for financial statements issued for fiscal years beginning after November 15, 2007 and interim periods within those fiscal years. The changes to current accounting principles generally accepted in the United States of America from the application of this Statement relate to the definition of fair value, the methods used to measure fair value, and the expanded disclosures about fair value measurements. As of June 30, 2007, the Fund does not believe the adoption of SFAS No. 157 will impact the financial statement amounts; however, additional disclosures may be required about the inputs used to develop the measurements and the effect of certain of the measurements on changes in net assets for the period.
Trustees who are not Interested Persons (as defined in the 1940 Act) and Officers of the Trust as of
Number of Portfolios | ||||||||||
Position(s) Held | in the | |||||||||
with the Trust | Principal Occupation(s) | Nationwide Fund | Other | |||||||
Name, Address | and Length of | During Past | Complex Overseen | Directorships | ||||||
and Year of Birth | Time Served1 | Five Years | by Trustee | Held by Trustee2 | ||||||
Charles E. Allen c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1948 | Trustee since July 2000 | Mr. Allen is Chairman, Chief Executive Officer and President of Graimark Realty Advisors, Inc. (real estate development, investment and asset management). | 89 | None | ||||||
Paula H.J. Cholmondeley c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1947 | Trustee since July 2000 | Ms. Cholmondeley was Vice President and General Manager of Sappi Fine Paper North America from April 2000 through December 2003. | 89 | Director of Dentsply International, Inc. (dental products), Ultralife Batteries, Inc., Terex Corporation (construction equipment), Minerals Technology, Inc. (specialty chemicals) and Albany International Corp. (paper industry) | ||||||
C. Brent DeVore3 c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1940 | Trustee since 1990 | Dr. DeVore is President of Otterbein College. | 89 | None | ||||||
Phyllis Kay Dryden c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1947 | Trustee since December 2004 | Ms. Dryden was a partner of Mitchell Madison, a management consulting company from January 2006 until December 2006; she is currently a consultant with the company. Ms. Dryden was formerly Managing Partner of march FIRST, a global management consulting firm. | 89 | None | ||||||
Barbara L. Hennigar c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1935 | Trustee since July 2000 | Retired. | 89 | None | ||||||
Number of Portfolios | ||||||||||
Position(s) Held | in the | |||||||||
with the Trust | Principal Occupation(s) | Nationwide Fund | Other | |||||||
Name, Address | and Length of | During Past | Complex Overseen | Directorships | ||||||
and Year of Birth | Time Served1 | Five Years | by Trustee | Held by Trustee2 | ||||||
Barbara I. Jacobs c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1950 | Trustee since December 2004 | Ms. Jacobs served as Chairman of the Board of Directors of KICAP Network Fund, a European (United Kingdom) hedge fund, from January 2001 through January 2006. From 1998-2003, Ms. Jacobs was also a Managing Director and European Portfolio Manager of CREF Investments (Teachers Insurance and Annuity Association-College Retirement Equities Fund). | 89 | None | ||||||
Douglas F. Kridler c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1955 | Trustee since September 1997 | Mr. Kridler has served as the President and Chief Executive Officer of the Columbus Foundation (a Columbus, OH-based foundation which manages over 1,300 individual endowment funds) since February 2002. Prior to January 31, 2002, Mr. Kridler was the President of the Columbus Association for the Performing Arts and Chairman of the Greater Columbus Convention and Visitors Bureau. | 89 | None | ||||||
Michael D. McCarthy c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1947 | Trustee since December 2004 | Retired. Mr. McCarthy was Chairman of VMAC (commodity swaps) from October 2002 until January 2007; and a partner of Pineville Properties LLC (a commercial real estate development firm) from September 2000 until January 2007. | 89 | None | ||||||
David C. Wetmore c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1948 | Trustee since 1995 and Chairman since February 2005 | Retired. | 89 | None | ||||||
1 | Length of time served includes time served with the Trust’s predecessors. | |
2 | Directorships held in (1) any other investment companies registered under the 1940 Act, (2) any company with a class of securities registered pursuant to Section 12 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or (3) any company subject to the requirements of Section 15(d) of the Exchange Act. | |
3 | Mr. DeVore has served as President of Otterbein College since 1984. Mark Thresher, President and Chief Operating Officer of Nationwide Financial Services, Inc. (“NFS”) has served as a member of the Board of Trustees of Otterbein College since 2000, currently serves as one of 30 of its trustees, and is currently one of two Vice Chairmen of the Board. Each of Nationwide Fund Advisors (“NFA”), the Funds’ investment adviser, and Nationwide Fund Distributors LLC (“NFD”), principal underwriter to the Trust, is a wholly-owned subsidiary of NFS. | |
Additional information regarding the Trustees and Officers may be found in the Trust’s Statement of Additional Information, which is available without charge upon request, by calling 800-848-0920. |
Trustees who are Interested Persons (as defined in the 1940 Act) and/or Officers of the Trust as of
Number of Portfolios | ||||||||||
Position(s) Held | in the | |||||||||
with the Trust | Principal Occupation(s) | Nationwide Fund | Other | |||||||
Name, Address | and Length of | During Past | Complex Overseen | Directorships | ||||||
and Year of Birth | Time Served1 | 5 Years | by Trustee | Held by Trustee 2 | ||||||
Arden L. Shisler c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1941 | Trustee since February 2000 | Retired. Mr. Shisler is the former President and Chief Executive Officer of KeB Transport, Inc., a trucking firm (2000 through 2002). He served as a consultant to KeB from January 2003 through December 2004. Since 1992, Mr. Shisler has also been Chairman of the Board for Nationwide Mutual Insurance Company.3 | 89 | Director of Nationwide Financial Services, Inc., Chairman of Nationwide Mutual Insurance Company3 | ||||||
John H. Grady Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1961 | President & Chief Executive Officer since December 2006 | Mr. Grady is President, and Chief Executive Officer of Nationwide Funds Group which includes Nationwide Fund Advisors,3 Nationwide Fund Management LLC,3 Nationwide Fund Distributors LLC 3 and NWD Investments,2 the asset management operations of Nationwide Mutual Insurance Company, which includes Morley Capital Management, Inc.,2 Nationwide Separate Accounts LLC,2 NorthPointe Capital LLC,2 and Nationwide SA Capital Trust2. From March 2004 until March 2006, Mr. Grady was Chief Executive Officer of Constellation Investment Management Co., L.P. (registered investment adviser), and President and Chief Executive Officer of Constellation Funds Group (registered investment companies). He also was President of Constellation Investment Distribution Co., Inc. (registered broker-dealer) from March 2004 until June 2006. From February 2001 until February 2004, Mr. Grady was Chief Operating and Chief Legal Officer; Managing Director, Mutual Funds Group, Turner Investment Partners, Inc. (registered investment adviser); Executive Vice President of Turner Funds and Turner Institutional Portfolios (registered investment companies); and President, Turner Investment Distributors, Inc. (registered broker-dealer). | N/A | None | ||||||
Gerald J. Holland Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1951 | Treasurer since March 2001 | Mr. Holland is Senior Vice President—Operations for Nationwide Funds Group3. | N/A | N/A | ||||||
Number of Portfolios | ||||||||||
Position(s) Held | in the | |||||||||
with the Trust | Principal Occupation(s) | Nationwide Fund | Other | |||||||
Name, Address | and Length of | During Past | Complex Overseen | Directorships | ||||||
and Year of Birth | Time Served1 | 5 Years | by Trustee | Held by Trustee 2 | ||||||
Michael A. Krulikowski Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1959 | Chief Compliance Officer from June 2004 to August 20074 | Mr. Krulikowski is Vice President and Chief Compliance Officer of Nationwide Funds Group3, Morley Capital Management, Inc.3, Nationwide SA Capital Trust (since 1999)3, and Nationwide Separate Accounts LLC (since August 2005).3 Since June 2004, Mr. Krulikowski has also served as Chief Compliance Officer of the Trust. From November 1999 through May 2007, he served as Vice President and Chief Compliance Officer of NorthPointe Capital LLC. 3 | N/A | N/A | ||||||
Eric E. Miller Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1953 | Secretary since December 2002 | Mr. Miller is Senior Vice President, General Counsel, and Assistant Secretary for Nationwide Funds Group3 and NWD Investments.2 From August 2000 to August 2002, Mr. Miller was a Partner with Stradley Ronon Stevens & Young, LLP. | N/A | N/A | ||||||
1 | Length of time served includes time served with the Trust’s predecessors. | |
2 | Directorships held in (1) any other investment companies registered under the 1940 Act, (2) any company with a class of securities registered pursuant to Section 12 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or (3) any company subject to the requirements of Section 15(d) of the Exchange Act. | |
3 | This position is held with an affiliated person or principal underwriter of the Trust. | |
4 | Effective August 3, 2007, the Board of Trustees approved Carol Baldwin Moody as Chief Compliance Officer of the Trust. Since November 2005, Ms. Moody has been Senior Vice President, Chief Compliance Officer of Nationwide Financial Services, Nationwide Life Insurance Company, Nationwide Life and Annuity Insurance Company, and Nationwide Investment Advisors, LLC. From February 2004-November 2005, she was Chief Compliance Officer of TIAA-CREF and from April 2000-February 2004, she was Managing Director and General Counsel, TCW/ Latin America Partners, LLC and Baeza & Co., LLC. | |
Federal law requires the Trust, each of its investment advisers and sub-advisers to adopt procedures for voting proxies (“Proxy Voting Guidelines”) and to provide a summary of those Proxy Voting Guidelines used to vote the securities held by the Funds. The Funds’ proxy voting policies and procedures are available without charge (i) upon request, by calling 800-848-0920, (ii) on the Funds’ website at www.nationwidefunds.com, or (iii) on the Securities and Exchange Commission’s website at www.sec.gov. |
A. Renewal of Investment Advisory Agreement
(i) | General Information Regarding the Board’s Review of Investment Advisory Agreements |
The Trust’s investment advisory agreements (each an “Advisory Agreement”) with its investment adviser and, as applicable, sub-advisers (together, the “Adviser”) must be approved for an initial term no greater than two years, and renewed at least annually thereafter, (i) by the vote of the Trustees or by a vote of the shareholders of each series or fund of the Trust (individually a “Fund” ), and (ii) by the vote of a majority of the Trustees who are not parties to the Advisory Agreement or “interested persons” of any party thereto (the “Independent Trustees”) cast in person at a meeting called for the purpose of voting on such approval.
The Board meets quarterly and takes into account throughout the year matters bearing on each Fund’s Advisory Agreement. The Board and its standing committees consider at each meeting factors that are relevant to the annual renewal of an Advisory Agreement, including the services and support provided to a Fund and its shareholders.
On December 6, 2006, the Independent Trustees first met in person with their independent legal counsel (“Independent Legal Counsel”) to consider information provided by the Adviser and others to assist the Trustees in considering whether to renew each Fund’s Advisory Agreement for a one year term beginning May 1, 2007. Immediately following such meeting of the Independent Trustees, all Trustees met in person with the Adviser, Trust counsel, Independent Legal Counsel and others to consider such matters, and give preliminary consideration to information bearing on continuation of each Advisory Agreement. The primary purpose of the December 6 and 7, 2006 meeting was to ensure that the Trustees had ample opportunity to consider matters they deemed relevant in considering the continuation of an Advisory Agreement, and to request any additional information they considered reasonably necessary to their deliberations.
In preparation for the December 6 and 7, 2006 meeting the Trustees were provided, at the request of the Trustees, with a wide range of information to assist in their deliberations, including (i) reports from Lipper Inc. describing a Fund’s (a) performance rankings (where “first quintile” denotes the best performance) (over multiple years ended September 30, 2006) compared with performance groups and performance universes created by Lipper (and in some cases, customized peer groups created by the Adviser) of similar or peer group funds, and (b) expense rankings (where “first quintile” denotes the lowest fees and expenses) comparing the Fund’s contractual advisory fee and total expenses with expense groups and expense universes created by Lipper of similar or peer group funds, (ii) information from the Adviser describing the Fund’s performance (over multiple years ended September 30, 2006) compared with its benchmark and Lipper categories, (iii) for Funds under “close review,” copies of letters from the Adviser to the portfolio manager of each such Fund, together with the portfolio manager’s written response describing the reasons for the Fund’s underperformance (iv) information from the Adviser describing performance for the months of October and November, 2006, and annual performance for the year ended November 30, 2006, (v) reports from the Adviser describing the Adviser’s profitability in providing services under an Advisory Agreement, together with an explanation of Adviser’s methodology in calculating its profitability, (vi) information from the Adviser describing any fees paid to the Adviser for managing similar, non-affiliated institutional accounts, including the range of fee levels for such accounts, and (vii) information from the Adviser describing ancillary benefits, in addition to fees for serving as investment adviser, derived by the Adviser as a result of being investment adviser for a Fund, including, where applicable, information on soft-dollar benefits and fees inuring to the Adviser’s affiliates for serving as the Trust’s administrator, fund accountant and transfer agent.
At the December 6 and 7, 2006 meeting, the Trustees reviewed, considered and discussed, among themselves and with the Adviser, Trust counsel and Independent Legal Counsel, among other things, the information described above, and: (i) the nature, extent and quality of services provided by the Adviser under each Advisory Agreement, (ii) the investment performance of each Fund and the Adviser, (iii) the costs of the services provided by the Adviser under the Advisory Agreement and the profits realized by the Adviser thereunder, (iv) the extent to which economies of scale may be present and, if so, whether they are being shared with a Fund’s shareholders, (v) comparisons of the Adviser’s fees under the Advisory Agreement with investment advisory fees paid by peer group funds to their investment advisers and paid by non-affiliated institutional clients to the Adviser for managing similar accounts, and (vi) any ancillary benefits inuring to the Adviser and its affiliates as a result of being investment adviser for the Trust. The Trustees also considered, where
As part of the December 6 and 7, 2006 Board meeting, the Independent Trustees developed a list of follow-up matters and questions and asked that Adviser respond to such matters and questions at the contract approval meeting of the Board of Trustees to be held on January 11, 2007.
At the January 11, 2007 meeting of the Board of Trustees of the Trust, the Board received and considered information provided by the Adviser in follow-up from the December 6 and 7, 2006 Board meeting and, after consulting among themselves, and with the Adviser, Trust counsel and Independent Legal Counsel, concluded unanimously to renew the Advisory Agreement for the reasons set forth in the following section. In determining whether to renew the Advisory Agreement for the Fund, the Board ultimately reached a determination, with the assistance of Trust counsel and Independent Legal Counsel, that the renewal of the Advisory Agreement and the compensation to be received by the Adviser under the Advisory Agreement is consistent with the Board’s fiduciary duty under applicable law.
(ii) | Board Conclusions Regarding the Fund’s Advisory Agreement |
The Board considered that the Fund had underperformed its benchmark, the MSCI Emerging Markets Index, for the one-, three-, and five-year periods. The Board also considered that the Fund’s Class II shares had ranked in the fifth quintile of the Fund’s Lipper-constructed Performance Group over the one-, two-, three-, four-, and five-year periods. Although the Fund’s performance compared with peer group funds over the periods considered ranked the Fund in the fifth quintile, the Board found that: (i) the portfolio manager for the Fund was changed during the year; (ii) recent performance had shown improvement; and (iii) the flows in and out of the Fund had been more extreme, which made management more difficult, and had affected performance. Based on its review, and giving particular weight to the nature and quality of the resources dedicated by the adviser and subadviser to improve relative performance, the Board concluded that the nature, extent, and quality of the services provided to the Fund will benefit the Fund’s shareholders.
The Board also considered that the Fund’s contractual advisory fee and breakpoints placed the Fund in the first quintile of its Lipper-constructed Expense Group and the Fund’s total expenses placed it in the second quintile. The Board considered that the Fund had implemented a performance fee structure, which is intended to either reward or penalize the adviser for outperforming or underperforming, respectively, the Fund’s benchmark. The Board concluded that the Fund’s management fee and total expenses were fair and reasonable in light of the services that the Fund receives and the other factors considered.
The Board considered that the Fund’s adviser reported a pre-tax profit margin for investment management services during each of the twelve month-periods ended September 30, 2006 and 2005. The Board considered the costs of the services provided by and the profits realized by the adviser in connection with the operation of the Fund and determined that the amount of profit is a fair entrepreneurial profit for the management of the Fund.
Based upon its evaluation of all of the conclusions noted above, and after considering all material factors with respect to the Fund, the Board ultimately concluded that the advisory fee structure is fair and reasonable, and that the Advisory Agreement (and, if applicable, Sub-Advisory Agreement) with respect to the Fund, should be renewed.
B. Approval of New Advisory Agreement
At its January 11, 2007 meeting, the Board also unanimously approved a new investment advisory agreement (the “New Agreement”) for the Fund with Nationwide Fund Advisors, (“NFA”) the then-current adviser to each of the series of the Trust to become effective upon the closing of the acquisition of NFA by Nationwide Financial Services, Inc. (“NFS”) from Nationwide Corporation (“NWC”) which closed on April 30, 2007 (the “Transaction”). In approving the New Agreement, the Board considered NFA’s capacity to continue to provide the services needed to operate a sophisticated investment management business and to support the management of each of the series. The Board also took into account
C. Submission of Matters to a Vote of Security Holders:
On April 25, 2007, a Special Meeting of Shareholders was held* (the “April 25 Meeting”) at which shareholders of the Funds** set forth below were asked:
Proposal 1:
To approve a new investment advisory agreement, on behalf of their Fund, between Nationwide Fund Advisors (formerly “Gartmore Mutual Fund Capital Trust”) (the “Adviser”) and Nationwide Variable Insurance Trust (formerly “Gartmore Variable Insurance Trust”) (the “Trust”).
Number of Shares | ||||||
Fund | Cast/Not Cast | Percentages | ||||
Federated NVIT High Income Bond Fund (Formerly Federated GVIT High Income Bond Fund) | FOR AGAINST ABSTAIN TOTAL | 30,051,703.188 shares 618,245.021 shares 1,813,550.431 shares 32,483,498.640 shares | 92.514% 1.903% 5.583% | |||
NVIT International Index Fund (Formerly GVIT International Index Fund) | FOR AGAINST ABSTAIN TOTAL | 4,322,203.982 shares 2,758.318 shares 135,636.840 shares 4,460,599.140 shares | 96.897% 0.062% 3.041% | |||
NVIT International Value Fund (Formerly GVIT International Value Fund) | FOR AGAINST ABSTAIN TOTAL | 20,032,843.199 shares 333,588.902 shares 1,093,293.879 shares 21,459,725.980 shares | 93.351% 1.554% 5.095% | |||
NVIT Mid Cap Index Fund (Formerly GVIT Mid Cap Index Fund) | FOR AGAINST ABSTAIN TOTAL | 35,380,179.120 shares 631,117.844 shares 1,565,714.306 shares 37,577,011.270 shares | 94.154% 1.679% 4.167% |
Number of Shares | ||||||
Fund | Cast/Not Cast | Percentages | ||||
NVIT S&P 500 Index Fund (Formerly GVIT S&P 500 Index Fund) | FOR AGAINST ABSTAIN TOTAL | 56,119,814.230 shares 666,195.542 shares 1,944,898.888 shares 58,730,908.660 shares | 95.554% 1.134% 3.312% | |||
Nationwide Multi-Manager NVIT Small Cap Growth Fund (Formerly GVIT Small Cap Growth Fund) | FOR AGAINST ABSTAIN TOTAL | 7,632,918.513 shares 149,458.111 shares 451,583.036 shares 8,233,959.660 shares | 92.700% 1.816% 5.484% | |||
Nationwide Multi-Manager NVIT Small Cap Value Fund (Formerly GVIT Small Cap Value Fund) | FOR AGAINST ABSTAIN TOTAL | 48,649,396.525 shares 979,183.753 shares 2,786,133.102 shares 52,414,713.380 shares | 92.816% 1.868% 5.316% | |||
Nationwide Multi-Manager NVIT Small Company Fund (Formerly GVIT Small Company Fund) | FOR AGAINST ABSTAIN TOTAL | 29,903,181.700 shares 838,774.923 shares 2,006,741.307 shares 32,748,697.930 shares | 91.311% 2.561% 6.128% | |||
Gartmore NVIT Developing Markets Fund (Formerly Gartmore GVIT Developing Markets Fund) | FOR AGAINST ABSTAIN TOTAL | 21,0177,889.443 shares 424,272.958 shares 1,543,850.729 shares 23,046,013.130 shares | 91.460% 1.841% 6.699% | |||
Gartmore NVIT Emerging Markets Fund (Formerly Gartmore GVIT Emerging Markets Fund) | FOR AGAINST ABSTAIN TOTAL | 17,050,534.593 shares 526,574.722 shares 881,608.905 shares 18,458,718.220 shares | 92.371% 2.853% 4.776% | |||
Nationwide NVIT Global Financial Services Fund (Formerly Gartmore GVIT Global Financial Services Fund) | FOR AGAINST ABSTAIN TOTAL | 1,554,847.333 shares 19,539.033 shares 52,206.494 shares 1,626,592.860 shares | 95.589% 1.201% 3.210% | |||
Nationwide NVIT Global Health Sciences Fund (Formerly Gartmore GVIT Global Health Sciences Fund) | FOR AGAINST ABSTAIN TOTAL | 4,722,963.678 shares 157,979.030 shares 207,642.222 shares 5,088,584.930 shares | 92.815% 3.104% 4.081% | |||
Nationwide NVIT Global Technology and Communications Fund (Formerly Gartmore GVIT Global Technology and Communications Fund) | FOR AGAINST ABSTAIN TOTAL | 8,585,472.039 shares 102,267.977 shares 489,577.634 shares 9,177,317.650 shares | 93.551% 1.114% 5.335% | |||
Gartmore NVIT Global Utilities Fund (Formerly Gartmore GVIT Global Utilities Fund) | FOR AGAINST ABSTAIN TOTAL | 4,123,270.549 shares 122,001.533 shares 240,276.088 shares 4,485,548.170 shares | 91.923% 2.720% 5.357% | |||
Nationwide NVIT Government Bond Fund (Formerly Gartmore GVIT Government Bond Fund) | FOR AGAINST ABSTAIN TOTAL | 88,471,567.462 shares 1,825,645.181 shares 5,841,990.727 shares 96,139,203.370 shares | 92.024% 1.899% 6.077% |
Number of Shares | ||||||
Fund | Cast/Not Cast | Percentages | ||||
Nationwide NVIT Growth Fund (Formerly Gartmore GVIT Growth Fund) | FOR AGAINST ABSTAIN TOTAL | 14,931,435.904 shares 409,826.402 shares 1,259,945.064 shares 16,601,207.370 shares | 89.942% 2.469% 7.589% | |||
Gartmore NVIT International Growth Fund (Formerly Gartmore GVIT International Growth Fund) | FOR AGAINST ABSTAIN TOTAL | 6,251,419.070 shares 139,618.548 shares 290,025.592 shares 6,681,063.210 shares | 93.569% 2.090% 4.341% | |||
Nationwide NVIT Investor Destinations Aggressive Fund (Formerly Gartmore GVIT Investor Destinations Aggressive Fund) | FOR AGAINST ABSTAIN TOTAL | 49,489,224.549 shares 1,385,396.474 shares 3,696,272.337 shares 54,570,893.360 shares | 90.688% 2.539% 6.773% | |||
Nationwide NVIT Investor Destinations Conservative Fund (Formerly Gartmore GVIT Investor Destinations Conservative Fund) | FOR AGAINST ABSTAIN TOTAL | 23,091,965.887 shares 314,935,884 shares 2,292,355.179 shares 25,699,256.950 shares | 89.855% 1.225% 8.920% | |||
Nationwide NVIT Investor Destinations Moderate Fund (Formerly Gartmore GVIT Investor Destinations Moderate Fund) | FOR AGAINST ABSTAIN TOTAL | 188,902,093.059 shares 3,018,924.590 shares 16,359,690.401 shares 208,280,708.050 shares | 90.696% 1.449% 7.855% | |||
Nationwide NVIT Investor Destinations Moderately Aggressive Fund (Formerly Gartmore GVIT Investor Destinations Moderately Aggressive Fund) | FOR AGAINST ABSTAIN TOTAL | 134,792,622.920 shares 3,489,207.264 shares 9,304,197.656 shares 147,586,027.840 shares | 91.332% 2.364% 6.304% | |||
Nationwide NVIT Investor Destinations Moderately Conservative Fund (Formerly Gartmore GVIT Investor Destinations Moderately Conservative Fund) | FOR AGAINST ABSTAIN TOTAL | 49,627,123.216 shares 856,088.634 shares 3,507,215.650 shares 53,990,427.500 shares | 91.918% 1.586% 6.496% | |||
Nationwide NVIT Mid Cap Growth Fund (Formerly Gartmore GVIT Mid Cap Growth Fund) | FOR AGAINST ABSTAIN TOTAL | 10,879,584.971 shares 352,594.958 shares 717,792.971 shares 11,949,972.900 shares | 91.043% 2.950% 6.007% | |||
Nationwide NVIT Money Market Fund II (Formerly Gartmore GVIT Money Market Fund II) | FOR AGAINST ABSTAIN TOTAL | 221,774,863.241 shares 12,322,482.494 shares 16,471,740.875 shares 250,569,086.610 shares | 88.508% 4.918% 6.574% | |||
Nationwide NVIT Money Market Fund (Formerly Gartmore GVIT Money Market Fund) | FOR AGAINST ABSTAIN TOTAL | 1,578,331,008.328 shares 32,372,133.671 shares 112,652,123.301 shares 1,723,355,265.300 shares | 91.585% 1.878% 6.537% | |||
NVIT Nationwide Fund (Formerly Gartmore GVIT Nationwide Fund) | FOR AGAINST ABSTAIN TOTAL | 125,423,274.735 shares 2,767,979.467 shares 8,762,255.828 shares 136,953,510.030 shares | 91.581% 2.021% 6.398% |
Number of Shares | ||||||
Fund | Cast/Not Cast | Percentages | ||||
NVIT Nationwide Leaders Fund (Formerly Gartmore GVIT Nationwide Leaders Fund) | FOR AGAINST ABSTAIN TOTAL | 2,298,504.956 shares 29,630.469 shares 71,637.755 shares 2,399,773.180 shares | 95.780% 1.235% 2.985% | |||
Nationwide NVIT U.S. Growth Leaders Fund (Formerly Gartmore GVIT U.S. Growth Leaders Fund) | FOR AGAINST ABSTAIN TOTAL | 4,972,094.773 shares 122,623.161 shares 174,625.606 shares 5,269,343.540 shares | 94.359% 2.327% 3.314% | |||
Gartmore NVIT Worldwide Leaders Fund (Formerly Gartmore GVIT Worldwide Leaders Fund) | FOR AGAINST ABSTAIN TOTAL | 2,666,862.487 shares 47,702.491 shares 118,719.882 shares 2,833,284.860 shares | 94.126% 1.684% 4.190% | |||
JP Morgan NVIT Balanced Fund (Formerly JP Morgan GVIT Balanced Fund) | FOR AGAINST ABSTAIN TOTAL | 15,966,867.546 shares 259,004.324 shares 1,339,385.200 shares 17,565,257.070 shares | 90.900% 1.475% 7.625% | |||
Van Kampen NVIT Comstock Value Fund (Formerly Van Kampen GVIT Comstock Value Fund) | FOR AGAINST ABSTAIN TOTAL | 27,737,008.009 shares 502,564.164 shares 1,824,670.107 shares 30,064,242.280 shares | 92.259% 1.672% 6.069% | |||
Van Kampen NVIT Multi Sector Bond Fund (Formerly Van Kampen GVIT Multi Sector Bond Fund) | FOR AGAINST ABSTAIN TOTAL | 21,253,297.665 shares 484,100.920 shares 1,803,963.645 shares 23,541,362.230 shares | 90.281% 2.056% 7.663% | |||
At the April 25 Meeting, shareholders of the Nationwide NVIT Mid Cap Growth Fund were also asked to approve a new investment subadvisory agreement among the Adviser, the Trust and NorthPointe Capital LLC. The voting results with respect to that proposal are set forth below:
Proposal 2:
Number of Shares | ||||||
Fund | Cast/Not Cast | Percentages | ||||
Nationwide NVIT Mid Cap Growth Fund (Formerly Gartmore GVIT Mid Cap Growth Fund) | FOR AGAINST ABSTAIN TOTAL | 10,862,827.499 shares 414,574.660 shares 672,570.741 shares 11,949,972.900 shares | 90.903% 3.469% 5.628% | |||
* | This meeting was previously adjourned on April 23, 2007. | |
** | Fund names were changed effective May 1, 2007 to reflect “Nationwide”/“NVIT” branding to coincide with the sale of Nationwide Fund Advisors, Inc. by Nationwide Corporation to its majority-owned subsidiary, Nationwide Financial Services, Inc. |
June 30, 2007 (Unaudited)
Contents | ||
6 | Statement of Investments | |
9 | Statement of Assets and Liabilities | |
10 | Statement of Operations | |
11 | Statements of Changes in Net Assets | |
13 | Financial Highlights | |
14 | Notes to Financial Statements |
Statement Regarding Availability of Proxy Voting Record.
SAR-GU (8/07) | ![]() |
Dear Fellow Shareholder:
Since I last wrote to you, our mutual funds have enjoyed another period of solid performance, and the corporate realignment that was in progress is now finished.
On May 1, 2007, Nationwide Financial Services, Inc. (NFS), completed its acquisition of the Philadelphia-based retail mutual fund operations of NWD Investment Management, Inc. (formerly, “Gartmore Global Investments, Inc.”), from Nationwide Corporation, a subsidiary of Nationwide Mutual Insurance Company. Effective that date, the acquired entities were renamed Nationwide Funds Group (NFG), and the Gartmore Funds were renamed the Nationwide Funds to better align with the Nationwide® brand. Although the corporate ownership and fund names have changed, I can assure you that NFG intends to maintain as much continuity as possible with the Funds and key personnel.
Thank you, shareholders, for approving the new investment advisory agreement that was required due to the change in corporate ownership. The new agreement is identical in all material respects to the original agreement that it replaces, with the exception of the section pertaining to the vote by the shareholders of the NVIT Mid Cap Growth Fund to approve NorthPointe Capital®, LLC (NorthPointe) as sub-adviser to that particular Fund.
Market Overview: January 1-June 30, 2007
Share prices in general were buoyed in part by better-than-expected first-quarter 2007 earnings and a flurry of mergers and acquisitions, many of these spurred by readily available funding from private equity firms. In June, investors grew more cautious amid surging crude oil prices, a sudden spike in long-term interest rates, and the meltdown of two hedge funds that had exposure to the subprime mortgage market. Looking abroad, a weak U.S. dollar aided foreign stocks, as reflected in the 11.09% advance of the Morgan Stanley Capital International Europe, Australasia and Far East (MSCI EAFE®) Index. Emerging market performance was particularly robust.
The bond market struggled during the first half of 2007. While short-term interest rates remained stable, reflecting the Federal Reserve Board’s decision in June to leave the target federal funds rate at 5.25%, longer-term rates climbed during the first half of 2007, depressing bond prices and forcing the Lehman Brothers® U.S. Aggregate Index to settle for a modest 0.97% return.
We at NFG thank you for your understanding and cooperation throughout our recent transition period. We emerge from this period energized for the future, and we look forward to serving your investment needs for a long time to come.
Nationwide Funds Group
PAST PERFORMANCE IS NO GUARANTEE OF FUTURE RESULTS.
Nationwide Funds are advised by Nationwide Fund Advisors (NFA). NFA is a wholly-owned subsidiary of Nationwide Financial Services. Nationwide Financial Services is a wholly-owned subsidiary of Nationwide Corporation. All of the common stock of Nationwide Corporation is held by Nationwide Mutual (95.2%) and Nationwide Mutual Fire Insurance Company (4.8%), each of which is a mutual company owned by its policyholders.
Nationwide Funds Group (NFG) is the mutual fund arm of Nationwide Financial Services (NYSE: NFS). Based in Conshohocken, Pa., a suburb of Philadelphia, NFG is comprised of Nationwide Fund Advisors, Nationwide Fund Distributors, LLC, and Nationwide Fund Management, LLC. Together, these provide advisory, distribution, and administration services respectively to the Nationwide Funds, and manage more than $43.5 billion in assets as of June 30, 2007, of which more than $12 billion are in “fund of funds” designed to provide asset allocation across several types of investments and asset classes.
Lehman Brothers (LB) U.S. Aggregate Index: An unmanaged, market value-weighted index of investment-grade, fixed-rate debt issues (including government, corporate, asset-backed, and mortgage-backed securities with maturities of one year or more) that is generally representative of the bond market as a whole.
Morgan Stanley Capital International Europe, Australasia and Far East (MSCI EAFE®) Index: An unmanaged, free float-adjusted, market capitalization-weighted index that is designed to measure the performance of stocks in developed markets outside the United States and Canada.
Standard & Poor’s 500® (S&P 500) Index: An unmanaged, market capitalization-weighted index of 500 widely held stocks of large-cap U.S. companies that gives a broad look at how the stock prices of those companies have performed.
Views expressed within are those of Nationwide Funds Group as of the date noted, are subject to change at any time, and may not come to pass.
This report is for informational purposes only, and is not intended as an offer or recommendation with respect to the purchase or sale of any security, option, future, or other derivatives in such securities.
Investing in mutual funds involves risk, including possible loss of principal.
Investors should carefully consider a fund’s investment objectives, risks, fees, charges, and expenses before investing any money. To obtain this and other fund information, please call 800-848-0920 to request a prospectus, or download a prospectus at www.nationwidefunds.com. Please read the prospectus carefully before investing any money.
Nationwide Funds distributed by Nationwide Fund Distributors LLC (formerly Gartmore Distribution Services, Inc.), Member NASD. 1200 River Road, Suite 1000, Conshohocken, Pa. 19428.
As a shareholder of the Fund, you incur two types of costs: (1) transaction costs, including sales charges (loads) paid on purchase payments and redemption fees; and (2) ongoing costs, including investment advisory fees, administration fees, distribution fees and other Fund expenses. The examples below are 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. Per SEC requirements, the examples assume that you had a $1,000 investment in the Class at the beginning of the reporting period, January 1, 2007, and continued to hold your shares at the end of the reporting period, June 30, 2007.
Actual Expenses
Hypothetical Example for Comparison Purposes
Please note that the expenses shown in the table are meant to highlight your ongoing costs only and do not reflect any transaction costs, such as sales charges (loads) or redemption fees. Therefore, the second line for each Class in 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 transaction costs were included, your costs would have been higher. The examples also assume all dividends and distributions have been reinvested.
Schedule of Shareholder Expenses
Beginning | Ending | |||||||||||||||||||||
Account Value, | Account Value, | Expenses Paid | Annualized | |||||||||||||||||||
Gartmore NVIT Global Utilities Fund | January 1, 2007 | June 30, 2007 | During Period* | Expense Ratio* | ||||||||||||||||||
Class I | Actual | $ | 1,000.00 | $ | 1,089.30 | $ | 4.97 | 0.96% | ||||||||||||||
Hypothetical | 1 | $ | 1,000.00 | $ | 1,020.04 | $ | 4.82 | 0.96% | ||||||||||||||
Class II | Actual | $ | 1,000.00 | $ | 1,087.60 | $ | 6.37 | 1.23% | ||||||||||||||
Hypothetical | 1 | $ | 1,000.00 | $ | 1,018.70 | $ | 6.18 | 1.23% | ||||||||||||||
Class III | Actual | $ | 1,000.00 | $ | 1,089.80 | $ | 4.97 | 0.96% | ||||||||||||||
Hypothetical | 1 | $ | 1,000.00 | $ | 1,020.04 | $ | 4.82 | 0.96% | ||||||||||||||
* | Expenses are equal to the Fund’s annualized expense ratio multiplied by the average account value over the period multiplied by 181/365 (to reflect the one-half year period). The expense ratio presented represents a six-month, annualized ratio in accordance with SEC guidelines. The expenses reported above do not include the effect of additional expenses imposed by variable annuity contracts. | |
1 | Represents the hypothetical 5% return before expenses. |
Asset Allocation | ||||
Common Stock | 100.4% | |||
Repurchase Agreements | 0.2% | |||
Liabilities in excess of other assets | -0.6% | |||
100.0% |
Top Holdings* | ||||
AT&T, Inc. | 12.2% | |||
Vodafone Group PLC | 8.2% | |||
Verizon Communications, Inc. | 5.9% | |||
Telefonica SA | 4.3% | |||
E. On AG | 4.2% | |||
RWE AG | 3.2% | |||
PPL Corp. | 2.5% | |||
Koninklijke KPN NV | 2.4% | |||
Exelon Corp. | 2.4% | |||
Iberdrola SA | 2.4% | |||
Other | 52.3% | |||
100.0% |
Top Industries | ||||
Diversified Telecommunication Services | 33.6% | |||
Electric Utilities | 26.2% | |||
Wireless Telecommunication Services | 15.8% | |||
Multi-Utilities | 12.7% | |||
Oil, Gas & Consumable Fuels | 4.4% | |||
Independent Power Producers & Energy Traders | 3.8% | |||
Gas Utilities | 2.4% | |||
Water Utilities | 1.5% | |||
Other | -0.4% | |||
100.0% |
Top Countries | ||||
United States | 48.5% | |||
United Kingdom | 17.9% | |||
Spain | 7.9% | |||
Germany | 7.4% | |||
Japan | 5.4% | |||
France | 4.1% | |||
Netherlands | 2.4% | |||
Italy | 1.8% | |||
Greece | 1.5% | |||
Mexico | 1.1% | |||
Other | 2.0% | |||
100.0% |
* | For purpose of listing top holdings, repurchase agreements are included as part of Other. |
Gartmore NVIT Global Utilities Fund
Common Stock (100.4%) | ||||||||
Shares or | ||||||||
Principal Amount | Value | |||||||
AUSTRIA (0.4%)(a) | ||||||||
Diversified Telecommunication Services (0.4%) | ||||||||
Telekom Austria AG | 14,730 | $ | 366,779 | |||||
BELGIUM (0.4%)(a) | ||||||||
Electric Utility (0.2%) | ||||||||
Elia System Operator SA | 3,310 | 134,506 | ||||||
Wireless Telecommunication Services (0.2%) | ||||||||
Mobistar SA | 2,150 | 183,121 | ||||||
317,627 | ||||||||
FRANCE (4.1%)(a) | ||||||||
Diversified Telecommunication Services (1.7%) | ||||||||
France Telecom SA | 52,000 | 1,426,020 | ||||||
Multi-Utility (1.9%) | ||||||||
Suez SA | 27,150 | 1,551,955 | ||||||
Wireless Telecommunication Services (0.5%) | ||||||||
Bouygues SA | 5,200 | 435,636 | ||||||
3,413,611 | ||||||||
GERMANY (7.4%)(a) | ||||||||
Electric Utility (4.2%) | ||||||||
E. On AG | 21,000 | 3,505,836 | ||||||
Multi-Utility (3.2%) | ||||||||
RWE AG | 25,500 | 2,704,753 | ||||||
6,210,589 | ||||||||
GREECE (1.5%) | ||||||||
Diversified Telecommunication Services (0.5%) | ||||||||
Hellenic Telecommunications Organization SA | 12,181 | 377,498 | ||||||
Wireless Telecommunication Services (1.0%)(a) | ||||||||
Cosmote Mobile Telecommunications SA | 28,140 | 868,052 | ||||||
1,245,550 | ||||||||
HONG KONG (0.1%)(a) | ||||||||
Electric Utility (0.1%) | ||||||||
CLP Holdings Ltd. | 14,000 | 93,982 | ||||||
ITALY (1.8%)(a) | ||||||||
Diversified Telecommunication Services (1.7%) | ||||||||
Telecom Italia SPA | 270,000 | 739,126 | ||||||
Telecom Italia SPA RNC | 289,310 | 641,112 | ||||||
1,380,238 | ||||||||
Gas Utility (0.1%) | ||||||||
Snam Rete Gas SPA | 18,005 | 106,454 | ||||||
1,486,692 | ||||||||
JAPAN (5.4%)(a) | ||||||||
Diversified Telecommunication Services (0.9)% | ||||||||
Nippon TeleGraph & Telephone Corp. | 163 | 721,414 | ||||||
Electric Utilities (1.5%) | ||||||||
Chubu Electric Power Co., Inc. | 9,800 | 260,056 | ||||||
Kansai Electric Power Co., Inc. | 9,200 | 217,606 | ||||||
Kyushu Electric Power Co., Inc. | 7,300 | 191,352 | ||||||
Tohoku Electric Power Co., Inc. | 6,700 | 150,310 | ||||||
Tokyo Electric Power Co., Inc. | 13,200 | 424,655 | ||||||
1,243,979 | ||||||||
Gas Utilities (0.3%) | ||||||||
Osaka Gas Co. Ltd. | 40,000 | 148,648 | ||||||
Tokyo Gas Co. Ltd. | 32,000 | 151,757 | ||||||
300,405 | ||||||||
Wireless Telecommunication Services (2.7%) | ||||||||
KDDI Corp. | 170 | 1,259,520 | ||||||
NTT DoCoMo, Inc. | 638 | 1,009,183 | ||||||
2,268,703 | ||||||||
4,534,501 | ||||||||
MEXICO (1.1%) | ||||||||
Wireless Telecommunication Services (1.1%) | ||||||||
America Movil SA de CV ADR | 14,580 | 902,939 | ||||||
NETHERLANDS (2.4%)(a) | ||||||||
Diversified Telecommunication Services (2.4%) | ||||||||
Koninklijke KPN NV | 124,500 | 2,065,330 | ||||||
PORTUGAL (0.4%)(a) | ||||||||
Electric Utility (0.4%) | ||||||||
EDP — Energias de Portugal SA | 54,960 | 303,876 | ||||||
SINGAPORE (0.7%)(a) | ||||||||
Diversified Telecommunication Services (0.7%) | ||||||||
Singapore Telecommunications Ltd. | 279,000 | 620,644 | ||||||
SPAIN (7.9%)(a) | ||||||||
Diversified Telecommunication Services (4.3%) | ||||||||
Telefonica SA | 163,900 | 3,647,048 | ||||||
Common Stock (continued) | ||||||||
Shares or | ||||||||
Principal Amount | Value | |||||||
SPAIN (continued) | ||||||||
Electric Utilities (3.6%) | ||||||||
Iberdrola SA | 35,500 | $ | 1,981,982 | |||||
Union Fenosa SA | 19,500 | 1,040,959 | ||||||
3,022,941 | ||||||||
6,669,989 | ||||||||
SWEDEN (0.6%)(a) | ||||||||
Diversified Telecommunication Services (0.6%) | ||||||||
TeliaSonera AB | 73,870 | 542,095 | ||||||
UNITED KINGDOM (17.9%)(a) | ||||||||
Diversified Telecommunication Services (2.3%) | ||||||||
BT Group PLC | 246,800 | 1,642,424 | ||||||
Cable & Wireless PLC | 70,000 | 271,868 | ||||||
1,914,292 | ||||||||
Electric Utility (2.1%) | ||||||||
Scottish & Southern Energy PLC | 60,000 | 1,739,481 | ||||||
Independent Power Producers & Energy Traders (1.4%) | ||||||||
International Power PLC | 140,100 | 1,204,135 | ||||||
Multi-Utilities (2.4%) | ||||||||
Centrica PLC | 190,000 | 1,476,015 | ||||||
United Utilities PLC | 41,000 | 582,378 | ||||||
2,058,393 | ||||||||
Water Utilities (1.5%) | ||||||||
Kelda Group PLC | 16,930 | 319,042 | ||||||
Pennon Group PLC | 76,900 | 945,357 | ||||||
1,264,399 | ||||||||
Wireless Telecommunication Services (8.2%) | ||||||||
Vodafone Group PLC | 2,047,700 | 6,860,767 | ||||||
15,041,467 | ||||||||
UNITED STATES (48.3%) | ||||||||
Diversified Telecommunication Services (18.1%) | ||||||||
AT&T, Inc. | 246,100 | 10,213,150 | ||||||
Verizon Communications, Inc. | 120,700 | 4,969,219 | ||||||
15,182,369 | ||||||||
Electric Utilities (14.1%) | ||||||||
DPL, Inc. | 30,360 | 860,402 | ||||||
Duke Energy Corp. | 22,560 | 412,848 | ||||||
Edison International | 30,800 | 1,728,496 | ||||||
Entergy Corp. | 14,600 | 1,567,310 | ||||||
Exelon Corp. | 27,900 | 2,025,540 | ||||||
FirstEnergy Corp. | 14,610 | 945,705 | ||||||
FPL Group, Inc. | 16,796 | 953,005 | ||||||
PPL Corp. | 44,900 | 2,100,871 | ||||||
Progress Energy, Inc. | 9,330 | 425,355 | ||||||
Reliant Energy, Inc.* | 31,700 | 854,315 | ||||||
11,873,847 | ||||||||
Gas Utility (2.0%) | ||||||||
Questar Corp. | 31,600 | 1,670,060 | ||||||
Independent Power Producers & Energy Traders (2.4%) | ||||||||
AES Corp.* | 17,100 | 374,148 | ||||||
Constellation Energy Group | 9,300 | 810,681 | ||||||
NRG Energy, Inc.* | 19,900 | 827,243 | ||||||
2,012,072 | ||||||||
Multi-Utilities (5.2%) | ||||||||
Alliant Energy Corp. | 30,000 | 1,165,500 | ||||||
CenterPoint Energy, Inc. | 59,900 | 1,042,260 | ||||||
Nstar | 7,580 | 245,971 | ||||||
PG&E Corp. | 9,630 | 436,239 | ||||||
Sempra Energy | 25,100 | 1,486,673 | ||||||
4,376,643 | ||||||||
Oil, Gas & Consumable Fuels (4.4%) | ||||||||
El Paso Corp. | 74,300 | 1,280,189 | ||||||
Southwestern Energy Co.* | 18,300 | 814,350 | ||||||
Sunoco, Inc. | 7,690 | 612,739 | ||||||
Williams Cos., Inc. (The) | 31,620 | 999,825 | ||||||
3,707,103 | ||||||||
Wireless Telecommunication Services (2.1%) | ||||||||
Sprint Nextel Corp. | 86,000 | 1,781,060 | ||||||
40,603,154 | ||||||||
Total Common Stocks (Cost $73,013,082) | 84,418,825 | |||||||
Repurchase Agreements (0.2%) | ||||||||
Nomura Securities, 5.20% dated 06/29/07, due 07/02/07, Repurchase price $193,213, collateralized by U.S. Government Agency Mortgages with a market value of $196,992 | $ | 193,129 | 193,129 | |||||
Gartmore NVIT Global Utilities Fund (Continued)
Repurchase Agreements (continued) | ||||||||
Shares or | ||||||||
Principal Amount | Value | |||||||
Total Investments — 100.6% (Cost $73,206,211) (b) | $ | 84,611,954 | ||||||
Liabilities in excess of other assets — (0.6)% | (534,836 | ) | ||||||
NET ASSETS — 100.0% | $ | 84,077,118 | ||||||
* | Denotes a non-income producing security. | |
(a) | Fair Valued Security. | |
(b) | See notes to financial statements for tax unrealized appreciation (depreciation) of securities. |
ADR | American Depository Receipt |
See accompanying notes to financial statements.
Gartmore NVIT | ||||||
Global Utilities Fund | ||||||
Assets: | ||||||
Investments, at value (cost $73,013,082) | $ | 84,418,825 | ||||
Repurchase agreements, at cost and value | 193,129 | |||||
Total Investments | 84,611,954 | |||||
Foreign currencies, at value (cost $13,436) | 13,441 | |||||
Interest and dividends receivable | 511,847 | |||||
Receivable for capital shares issued | 2,373 | |||||
Receivable for investments sold | 5,246,452 | |||||
Unrealized appreciation on spot contracts | 1,185 | |||||
Reclaims receivable | 40,146 | |||||
Prepaid expenses | 904 | |||||
Total Assets | 90,428,302 | |||||
Liabilities: | ||||||
Payable to custodian | 15,250 | |||||
Payable for investments purchased | 5,929,665 | |||||
Unrealized depreciation on spot contracts | 9,712 | |||||
Payable for capital shares redeemed | 220,757 | |||||
Accrued expenses and other payables: | ||||||
Investment advisory fees | 150,800 | |||||
Fund administration and transfer agent fees | 6,731 | |||||
Distribution fees | 205 | |||||
Administrative servicing fees | 10,021 | |||||
Compliance program costs | 885 | |||||
Other | 7,158 | |||||
Total Liabilities | 6,351,184 | |||||
Net Assets | $ | 84,077,118 | ||||
Represented by: | ||||||
Capital | $ | 66,246,249 | ||||
Accumulated net investment income | 689,896 | |||||
Accumulated net realized gains from investment transactions and foreign currency transactions | 5,730,803 | |||||
Net unrealized appreciation on investments and translation of assets and liabilities denominated in foreign currencies | 11,410,170 | |||||
Net Assets | $ | 84,077,118 | ||||
Net Assets: | ||||||
Class I Shares | $ | 24,879,302 | ||||
Class II Shares | 994,835 | |||||
Class III Shares | 58,202,981 | |||||
Total | $ | 84,077,118 | ||||
Shares outstanding (unlimited number of shares authorized): | ||||||
Class I Shares | 1,815,551 | |||||
Class II Shares | 72,357 | |||||
Class III Shares | 4,234,264 | |||||
Total | 6,122,172 | |||||
Net asset value and offering price per share (Net assets by class divided by shares outstanding by class, respectively.): | ||||||
Class I Shares | $ | 13.70 | ||||
Class II Shares | $ | 13.75 | ||||
Class III Shares | $ | 13.75 | ||||
9
Gartmore NVIT | |||||
Global Utilities Fund | |||||
INVESTMENT INCOME: | |||||
Interest income | $ | 16,940 | |||
Dividend income | 1,848,775 | ||||
Foreign tax withholding | (116,878 | ) | |||
Total Income | 1,748,837 | ||||
Expenses: | |||||
Investment advisory fees | 274,037 | ||||
Fund administration and transfer agent fees | 32,219 | ||||
Distribution fees Class II Shares | 1,297 | ||||
Administrative servicing fees Class I Shares | 13,637 | ||||
Administrative servicing fees Class II Shares | 758 | ||||
Administrative servicing fees Class III Shares | 40,096 | ||||
Custodian fees | 2,653 | ||||
Trustee fees | 1,722 | ||||
Compliance program costs (Note 3) | 533 | ||||
Other | 16,682 | ||||
Total expenses before earnings credit | 383,634 | ||||
Earnings credit (Note 6) | (96 | ) | |||
Net Expenses | 383,538 | ||||
Net Investment Income | 1,365,299 | ||||
REALIZED/ UNREALIZED GAINS (LOSSES) FROM INVESTMENTS: | |||||
Net realized gains on investment transactions | 5,936,737 | ||||
Net realized losses on foreign currency transactions | (31,116 | ) | |||
Net realized gains on investment transactions and foreign currency transactions | 5,905,621 | ||||
Net change in unrealized depreciation on investments and translation of assets and liabilities denominated in foreign currencies | (539,609 | ) | |||
Net realized/unrealized gains (losses) on investments and translation of assets and liabilities denominated in foreign currencies | 5,366,012 | ||||
CHANGE IN NET ASSETS RESULTING FROM OPERATIONS | $ | 6,731,311 | |||
10
Gartmore NVIT Global Utilities Fund | |||||||||
Six Months Ended | Year Ended | ||||||||
June 30, 2007 | December 31, 2006 | ||||||||
(Unaudited) | |||||||||
FROM INVESTMENT ACTIVITIES: | |||||||||
Operations: | |||||||||
Net investment income | $ | 1,365,299 | $ | 1,345,086 | |||||
Net realized gains on investment transactions and foreign currency transactions | 5,905,621 | 4,526,006 | |||||||
Net change in unrealized appreciation/depreciation on investments and translation of assets and liabilities denominated in foreign currencies | (539,609 | ) | 10,852,034 | ||||||
Change in net assets resulting from operations | 6,731,311 | 16,723,126 | |||||||
Distributions to shareholders from: | |||||||||
Net investment income: | |||||||||
Class I | (191,526 | ) | (158,945 | ) | |||||
Class II | (6,642 | ) | (21,607 | ) | |||||
Class III | (479,387 | ) | (1,161,213 | ) | |||||
Net realized gains: | |||||||||
Class I | (285,589 | ) | (455,111 | ) | |||||
Class II | (11,361 | ) | (59,551 | ) | |||||
Class III | (692,746 | ) | (3,210,811 | ) | |||||
Change in net assets from shareholder distributions | (1,667,251 | ) | (5,067,238 | ) | |||||
Change in net assets from capital transactions | 9,906,157 | 18,035,902 | |||||||
Change in net assets | 14,970,217 | 29,691,790 | |||||||
Net Assets: | |||||||||
Beginning of period | 69,106,901 | 39,415,111 | |||||||
End of period | $ | 84,077,118 | $ | 69,106,901 | |||||
Accumulated net investment income at end of period | $ | 689,896 | $ | 2,152 | |||||
CAPITAL TRANSACTIONS: | |||||||||
Class I Shares | |||||||||
Proceeds from shares issued | $ | 16,755,058 | $ | 9,637,169 | |||||
Dividends reinvested | 477,113 | 614,055 | |||||||
Cost of shares redeemed (a) | (2,021,048 | ) | (7,927,049 | ) | |||||
15,211,123 | 2,324,175 | ||||||||
Class II Shares | |||||||||
Proceeds from shares issued | 105 | – | |||||||
Dividends reinvested | 18,003 | 81,158 | |||||||
Cost of shares redeemed (a) | (147,717 | ) | (155,233 | ) | |||||
(129,609 | ) | (74,075 | ) | ||||||
Class III Shares | |||||||||
Proceeds from shares issued | 8,889,127 | 21,209,217 | |||||||
Dividends reinvested | 1,172,123 | 4,372,018 | |||||||
Cost of shares redeemed (a) | (15,236,607 | ) | (9,795,433 | ) | |||||
(5,175,357 | ) | 15,785,802 | |||||||
Change in net assets from capital transactions | $ | 9,906,157 | $ | 18,035,902 | |||||
11
Gartmore NVIT Global Utilities Fund | |||||||||
Six Months Ended | Year Ended | ||||||||
June 30, 2007 | December 31, 2006 | ||||||||
(Unaudited) | |||||||||
SHARE TRANSACTIONS: | |||||||||
Class I Shares | |||||||||
Issued | 1,271,923 | 782,111 | |||||||
Reinvested | 35,481 | 49,060 | |||||||
Redeemed | (153,371 | ) | (623,869 | ) | |||||
1,154,033 | 207,302 | ||||||||
Class II Shares | |||||||||
Reinvested | 1,335 | 6,542 | |||||||
Redeemed | (10,763 | ) | (13,516 | ) | |||||
(9,428 | ) | (6,974 | ) | ||||||
Class III Shares | |||||||||
Issued | 643,290 | 1,815,201 | |||||||
Reinvested | 86,916 | 349,318 | |||||||
Redeemed | (1,123,983 | ) | (874,332 | ) | |||||
(393,777 | ) | 1,290,187 | |||||||
Total change in shares | 750,828 | 1,490,515 | |||||||
(a) | Includes redemption fees, if any. |
12
Distributions | ||||||||||||||||||||
Investment Activities | ||||||||||||||||||||
Net Realized | ||||||||||||||||||||
and | ||||||||||||||||||||
Net Asset | Unrealized | Total | ||||||||||||||||||
Value, | Net | Gains | from | Net | ||||||||||||||||
Beginning | Investment | (Losses) on | Investment | Investment | ||||||||||||||||
of Period | Income | Investments | Activities | Income | ||||||||||||||||
Class I Shares | ||||||||||||||||||||
Period ended December 31, 2002 (e) | $ | 8.38 | 0.08 | (0.96 | ) | (0.88 | ) | (0.09 | ) | |||||||||||
For the year ended December 31, 2003 | $ | 7.42 | 0.06 | 1.71 | 1.77 | (0.04 | ) | |||||||||||||
For the year ended December 31, 2004 | $ | 9.16 | 0.13 | 2.60 | 2.73 | (0.13 | ) | |||||||||||||
For the year ended December 31, 2005 | $ | 11.26 | 0.22 | 0.48 | 0.70 | (0.24 | ) | |||||||||||||
For the year ended December 31, 2006 | $ | 10.13 | 0.32 | 3.44 | 3.76 | (0.30 | ) | |||||||||||||
For the six months ended June 30, 2007 (Unaudited) | $ | 12.83 | 0.20 | 0.94 | 1.14 | (0.11 | ) | |||||||||||||
Class II Shares | ||||||||||||||||||||
Period ended December 31, 2003 (g) | $ | 7.08 | 0.03 | 2.09 | 2.12 | (0.03 | ) | |||||||||||||
For the year ended December 31, 2004 | $ | 9.18 | 0.18 | 2.53 | 2.71 | (0.11 | ) | |||||||||||||
For the year ended December 31, 2005 | $ | 11.28 | 0.20 | 0.48 | 0.68 | (0.21 | ) | |||||||||||||
For the year ended December 31, 2006 | $ | 10.16 | 0.32 | 3.42 | 3.74 | (0.27 | ) | |||||||||||||
For the six months ended June 30, 2007 (Unaudited) | $ | 12.87 | 0.21 | 0.92 | 1.13 | (0.09 | ) | |||||||||||||
Class III Shares | ||||||||||||||||||||
For the year ended December 31, 2002 | $ | 10.01 | 0.12 | (2.62 | ) | (2.50 | ) | (0.09 | ) | |||||||||||
For the year ended December 31, 2003 | $ | 7.43 | 0.10 | 1.68 | 1.78 | (0.04 | ) | |||||||||||||
For the year ended December 31, 2004 | $ | 9.18 | 0.14 | 2.60 | 2.74 | (0.14 | ) | |||||||||||||
For the year ended December 31, 2005 | $ | 11.28 | 0.22 | 0.49 | 0.71 | (0.24 | ) | |||||||||||||
For the year ended December 31, 2006 | $ | 10.16 | 0.30 | 3.47 | 3.77 | (0.30 | ) | |||||||||||||
For the six months ended June 30, 2007 (Unaudited) | $ | 12.87 | 0.23 | 0.92 | 1.15 | (0.11 | ) | |||||||||||||
[Additional columns below]
[Continued from above table, first column(s) repeated]
Distributions | ||||||||||||||||||||||||||||
Paid-in | ||||||||||||||||||||||||||||
Capital | Ratio of | |||||||||||||||||||||||||||
Net | from | Net Asset | Net Assets | Expenses | ||||||||||||||||||||||||
Realized | Total | Redemption | Value, End | Total | at End of | to Average | ||||||||||||||||||||||
Gains | Distributions | Fees | of Period | Return (a) | Period (000s) | Net Assets (b) | ||||||||||||||||||||||
Class I Shares | ||||||||||||||||||||||||||||
Period ended December 31, 2002 (e) | – | (0.09 | ) | 0.01 | $ | 7.42 | (10.36%) | $ | 169 | 1.20% | ||||||||||||||||||
For the year ended December 31, 2003 | – | (0.04 | ) | 0.01 | $ | 9.16 | 24.05% | $ | 1,104 | 1.11% | ||||||||||||||||||
For the year ended December 31, 2004 | (0.50 | ) | (0.63 | ) | – | $ | 11.26 | 29.97% | $ | 4,679 | 1.08% | |||||||||||||||||
For the year ended December 31, 2005 | (1.59 | ) | (1.83 | ) | – | $ | 10.13 | 6.39% | $ | 4,602 | 1.12% | |||||||||||||||||
For the year ended December 31, 2006 | (0.76 | ) | (1.06 | ) | – | $ | 12.83 | 37.56% | $ | 8,489 | 1.03% | |||||||||||||||||
For the six months ended June 30, 2007 (Unaudited) | (0.16 | ) | (0.27 | ) | – | $ | 13.70 | 8.93% | $ | 24,879 | 0.96% | |||||||||||||||||
Class II Shares | ||||||||||||||||||||||||||||
Period ended December 31, 2003 (g) | – | (0.03 | ) | 0.01 | $ | 9.18 | 30.16% | $ | 1,092 | 1.36% | ||||||||||||||||||
For the year ended December 31, 2004 | (0.50 | ) | (0.61 | ) | – | $ | 11.28 | 29.56% | $ | 1,069 | 1.33% | |||||||||||||||||
For the year ended December 31, 2005 | (1.59 | ) | (1.80 | ) | – | $ | 10.16 | 6.19% | $ | 902 | 1.37% | |||||||||||||||||
For the year ended December 31, 2006 | (0.76 | ) | (1.03 | ) | – | $ | 12.87 | 37.33% | $ | 1,053 | 1.28% | |||||||||||||||||
For the six months ended June 30, 2007 (Unaudited) | (0.16 | ) | (0.25 | ) | – | $ | 13.75 | 8.76% | $ | 995 | 1.23% | |||||||||||||||||
Class III Shares | ||||||||||||||||||||||||||||
For the year ended December 31, 2002 | – | (0.09 | ) | 0.01 | $ | 7.43 | (24.85%) | $ | 3,571 | 1.10% | ||||||||||||||||||
For the year ended December 31, 2003 | – | (0.04 | ) | 0.01 | $ | 9.18 | 24.17% | $ | 7,054 | 1.04% | ||||||||||||||||||
For the year ended December 31, 2004 | (0.50 | ) | (0.64 | ) | – | $ | 11.28 | 29.95% | $ | 31,478 | 1.05% | |||||||||||||||||
For the year ended December 31, 2005 | (1.59 | ) | (1.83 | ) | – | $ | 10.16 | 6.48% | $ | 33,911 | 1.10% | |||||||||||||||||
For the year ended December 31, 2006 | (0.76 | ) | (1.06 | ) | – | $ | 12.87 | 37.59% | $ | 59,565 | 1.01% | |||||||||||||||||
For the six months ended June 30, 2007 (Unaudited) | (0.16 | ) | (0.27 | ) | – | $ | 13.75 | 8.98% | $ | 58,203 | 0.96% | |||||||||||||||||
[Additional columns below]
[Continued from above table, first column(s) repeated]
Ratios/Supplemental Data | ||||||||||||||||||
Ratio of Net | ||||||||||||||||||
Ratio of | Investment | |||||||||||||||||
Ratio of Net | Expenses | Income | ||||||||||||||||
Investment | (Prior to | (Prior to | ||||||||||||||||
Income | Reimbursements) | Reimbursements) | ||||||||||||||||
to Average | to Average | to Average | Portfolio | |||||||||||||||
Net Assets (b) | Net Assets (b)(c) | Net Assets (b)(c) | Turnover (d) | |||||||||||||||
Class I Shares | ||||||||||||||||||
Period ended December 31, 2002 (e) | 1.83% | (f) | (f) | 153.83% | ||||||||||||||
For the year ended December 31, 2003 | 1.28% | (f) | (f) | 116.62% | ||||||||||||||
For the year ended December 31, 2004 | 1.78% | (f) | (f) | 358.63% | ||||||||||||||
For the year ended December 31, 2005 | 1.92% | (f) | (f) | 234.81% | ||||||||||||||
For the year ended December 31, 2006 | 2.87% | (f) | (f) | 83.69% | ||||||||||||||
For the six months ended June 30, 2007 (Unaudited) | 4.10% | 0.97% | 4.10% | 53.47% | ||||||||||||||
Class II Shares | ||||||||||||||||||
Period ended December 31, 2003 (g) | 0.76% | (f) | (f) | 116.62% | ||||||||||||||
For the year ended December 31, 2004 | 1.58% | (f) | (f) | 358.63% | ||||||||||||||
For the year ended December 31, 2005 | 1.68% | (f) | (f) | 234.81% | ||||||||||||||
For the year ended December 31, 2006 | 2.70% | (f) | (f) | 83.69% | ||||||||||||||
For the six months ended June 30, 2007 (Unaudited) | 2.88% | 1.23% | 2.88% | 53.47% | ||||||||||||||
Class III Shares | ||||||||||||||||||
For the year ended December 31, 2002 | 1.79% | 1.11% | 1.78% | 153.83% | ||||||||||||||
For the year ended December 31, 2003 | 1.39% | (f) | (f) | 116.62% | ||||||||||||||
For the year ended December 31, 2004 | 1.73% | (f) | (f) | 358.63% | ||||||||||||||
For the year ended December 31, 2005 | 1.96% | (f) | (f) | 234.81% | ||||||||||||||
For the year ended December 31, 2006 | 2.80% | (f) | (f) | 83.69% | ||||||||||||||
For the six months ended June 30, 2007 (Unaudited) | 3.26% | 0.96% | 3.26% | 53.47% | ||||||||||||||
(a) | Not annualized for periods less than one year. | |
(b) | Annualized for periods less than one year. | |
(c) | During the period, certain fees were waived and/or reimbursed. If such waivers/reimbursements had not occurred, the ratios would have been as indicated. | |
(d) | Portfolio turnover is calculated on the basis of the Fund as a whole without distinguishing among the classes of shares. | |
(e) | For the period from May 10, 2002 (commencement of operations) through December 31, 2002. | |
(f) | There were no fee reductions during the period. | |
(g) | For the period from March 28, 2003 (commencement of operations) through December 31, 2003. |
See accompanying notes to financial statements.
1. Organization
Nationwide Variable Insurance Trust (“NVIT” or the “Trust”) is an open-end management investment company, organized under the laws of Delaware by an amended and restated Agreement and Declaration of Trust, dated October 28, 2004, as amended to date. Prior to May 1, 2007, the Trust was named “Gartmore Variable Insurance Trust”. The Trust, originally created under the laws of Massachusetts as a Massachusetts business trust pursuant to a Declaration of Trust dated, as of June 30, 1981, and as subsequently amended, redomesticated as a Delaware Statutory Trust after the close of trading on April 29, 2005, and is registered under the Investment Company Act of 1940, as amended (the “1940 Act”). The redomestication was a change in statutory status and did not affect the operations of the Trust. As of June 30, 2007, the Trust had authorized an unlimited number of shares of beneficial interest, without par value (“shares”). The Trust currently offers shares to life insurance company separate accounts to fund the benefits under variable life insurance or annuity policies. To date, only the separate accounts of Nationwide Life Insurance Company and Nationwide Life and Annuity Insurance Company (collectively, “Nationwide”) have purchased shares of the Gartmore NVIT Global Utilities Fund (the “Fund”) (formerly, “Gartmore GVIT Global Utilities Fund”). The Trust currently operates forty (40) separate series, or mutual funds, each with its own investment objectives and strategies. This report contains the financial statements and financial highlights of the Fund.
2. Summary of Significant Accounting Policies
The following is a summary of significant accounting policies followed by the Fund in the preparation of its financial statements. The policies are in conformity with accounting principles generally accepted in the United States of America (“GAAP”). The preparation of financial statements requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of income and expenses for the period. Actual results could differ from those estimates.
(a) | Security Valuation |
Securities for which market quotations are readily available are valued at current market value as of “Valuation Time.” Valuation Time is as of the close of regular trading on the New York Stock Exchange (usually 4 p.m. Eastern time). Equity securities are valued at the last quoted sale price or, if there is no sale price, the last quoted bid price provided by an independent pricing service approved by the Trust’s Board of Trustees (“Board of Trustees”). Securities traded on NASDAQ are valued at the NASDAQ official closing price. Prices are taken from the primary market or exchange in which each security trades. | |
Most securities listed on a foreign exchange are valued either at fair value (see description below) or at the last sale price at the close of the exchange on which the security is principally traded. Foreign securities, currencies, and other assets and liabilities denominated in foreign currencies are translated into U.S. dollars at the exchange rate of said currencies against the U.S. dollar, as of Valuation Time, as provided by an independent pricing service approved by the Board of Trustees. | |
Securities for which market quotations are not readily available, or for which an independent pricing service does not provide a value or provides a value that does not represent fair value in the judgment of the Fund’s investment adviser or designee, are valued at fair value under procedures approved by the Board of Trustees. The “Fair Value” of these securities is determined in good faith by taking into account relevant factors and surrounding circumstances. Methods utilized to obtain a “Fair Value” may include the following non-exclusive list of acceptable methods: (i) a multiple of earnings; (ii) the discount from market value of a similar, freely traded security; (iii) the yield-to-maturity for debt issues; or (iv) a consolidation of the methods. The Trust’s Valuation & Operations Committee considers a non-exclusive list of factors to arrive at the appropriate method of determining “Fair Value.” For example, fair value determinations are required for securities whose value is affected by a “significant” event that materially affects the value of a domestic or foreign security which occurs subsequent to the time of the close of the principal market on which such domestic or foreign security trades and before the Valuation Time (i.e., a “subsequent event”). Typically, |
this will involve events occurring after the close of a foreign market on which a security trades and before the next Valuation Time. | |
The Fund values foreign securities at fair value in the circumstances described below. Generally, trading in foreign securities markets is completed each day at various times prior to the Valuation Time. Due to the time differences between the closings of the relevant foreign securities exchanges and the Valuation Time for the Fund, the Fund will fair value its foreign investments when it is determined that the market quotations for the foreign investments either are not readily available or are unreliable and, therefore, do not represent fair value. When the fair value prices are utilized, these prices will attempt to reflect the impact of the U.S. financial markets’ perceptions and trading activities on the Fund’s foreign investments since the last closing prices of the foreign investments were calculated on their primary foreign securities markets or exchanges. For these purposes, the Board of Trustees has determined that movements in relevant indices or other appropriate market indicators, after the close of the foreign securities exchanges, may demonstrate that market quotations are unreliable, and may trigger fair value pricing for certain securities. Consequently, fair valuation of portfolio securities may occur on a daily basis. |
(b) | Repurchase Agreements |
The Fund may enter into repurchase agreements with an entity which is a member of the Federal Reserve System or which is a “primary dealer” (as designated by the Federal Reserve Bank of New York) in U.S. Government obligations. The repurchase price generally equals the price paid by the Fund plus interest negotiated on the basis of current short-term rates, which may be more or less than the rate on the underlying portfolio securities. The seller under a repurchase agreement is required to maintain the value of the collateral held pursuant to the agreement at a market value equal to or greater than the repurchase price (including accrued interest). Collateral subject to repurchase agreements is held by the Fund’s custodian or another qualified sub-custodian or in the Federal Reserve/ Treasury book-entry system. If the counterparty defaults and the fair value of the collateral declines, realization of the collateral by the Fund may be delayed or limited. The Fund may transfer uninvested cash balances into a pooled cash account. These balances are invested in one or more repurchase agreements, with the counterparty of Nomura Securities, which is fully collateralized by U.S. Government Agency Mortgages. |
(c) | Foreign Currency Transactions |
The accounting records of the Fund are maintained in U.S. dollars. Foreign currency amounts are translated into U.S. dollars at the current rate of exchange to determine the value of investments, assets and liabilities. The Fund may enter into foreign currency contracts in connection with purchases or sales of securities denominated in a foreign currency. Purchases and sales of securities, and income and expenses, are translated at the prevailing rate of exchange on the respective date of these transactions. The Fund does not isolate that portion of the results of operations resulting from changes in foreign exchange rates on investments from fluctuations arising from changes in market prices of securities held. These fluctuations are included with the net realized and unrealized gain or loss from investments and foreign currencies. |
(d) | Forward Foreign Currency Contracts |
The Fund may enter into forward foreign currency contracts in connection with planned purchases or sales of securities or to hedge the U.S. dollar value of portfolio securities denominated in a particular currency. The Fund could be exposed to risks if the counterparties to the contracts are unable to meet the terms of their contracts and from unanticipated movements in the value of a foreign currency relative to the U.S. dollar. Forward foreign currency contracts are valued at the current cost of covering these contracts, as provided by an independent pricing service approved by the Board of Trustees. The forward foreign currency contracts are adjusted by the daily exchange rate of the underlying currency and any gains or losses are recorded for financial statement purposes as unrealized gains or losses until the contract settlement date. |
(e) | Futures Contracts |
The Fund may invest in financial futures contracts (“futures contracts”) for the purpose of hedging its existing portfolio securities or securities that the Fund intends to purchase against fluctuations in value caused by changes in prevailing market interest rates or prices. Futures contracts may also be entered into for non-hedging purposes. | |
Upon entering into a futures contract, the Fund is required to pledge to the broker an amount of cash and/or other assets equal to a certain percentage of the contract amount (initial margin deposit). Subsequent payments, known as “variation margin,” are made each day, depending on the daily fluctuations in the fair value/market value of the underlying assets. A gain or loss equal to the daily variation margin is recognized on a daily basis. Futures contracts are valued daily at their last quoted sale price. | |
A “sale” of a futures contract means the creation of a contractual obligation to deliver the securities or foreign currency called for by the contract at a fixed price at a specified time in the future. A “purchase” of a futures contract means the creation of a contractual obligation to acquire the securities or foreign currency at a fixed price at a specified time in the future. | |
Should market conditions change unexpectedly, the Fund may not achieve the anticipated benefits of the futures contracts and may realize a loss. The use of futures transactions for hedging purposes involves the risk of imperfect correlation in movements in the price of futures contracts, interest rates, and the value of the underlying hedged assets. |
(f) | Written Options Contracts |
The Fund may write options contracts. A written option obligates the Fund to deliver (written call) or to receive (written put) a specified quantity of an underlying asset at the contract amount upon exercise by the holder of the option. When the Fund writes an option, an amount equal to the premium received by the Fund is recorded as a liability and is subsequently adjusted to the current fair value of the option written. Premiums received from writing options that expire unexercised are treated by the Fund on the expiration date as realized gains from investments. The difference between the premium and the amount paid on effecting a closing purchase transaction, as a realized loss. If a call option is exercised, the premium is added to the proceeds from the sale of the underlying security or currency in determining whether the Fund has realized a gain or loss. If a put option is exercised, the premium reduces the cost basis of the securities purchased by the Fund. Options traded on an exchange are valued at the last quoted sale price, or in the absence of a sale, the bid price provided by an independent pricing service approved by the Board of Trustees. Non-exchange traded options are valued using dealer supplied quotes. The Fund as a writer of an option bears the market risk of an unfavorable change in the price of the security underlying the written option. |
(g) | Short Sales |
The Fund is authorized to engage in short-selling of portfolio securities which obligates the Fund to replace any security that the Fund has borrowed by purchasing the security at current market value sometime in the future. The Fund will incur a loss if the price of the security increases between the date of the short sale and the date on which the Fund replaces the borrowed security. The Fund generally will realize a gain if the price of the security declines between these dates. Until the Fund replaces the borrowed security, the Fund will maintain a segregated account with cash, U.S. Government securities and/or securities held long to sufficiently cover the Fund’s short position on a daily basis. Dividends declared on securities sold short are recorded as an expense on the ex-dividend date and paid to the counterparty on the dividend pay date. |
(h) | Security Transactions and Investment Income |
Security transactions are accounted for on the date the security is purchased or sold (“trade date”). Securities gains and losses are calculated on the identified cost basis. Interest income is recognized on the accrual basis and includes, where applicable, the amortization or accretion of premium or discount. |
(i) | Securities Lending |
To generate additional income, the Fund may lend its portfolio securities, up to 33 1/3% of the Fund, to brokers, dealers and other financial institutions provided that (1) the borrower delivers cash or securities as collateral with respect to each new loan of U.S. securities, equal to at least 102% of the value of the portfolio securities loaned, and with respect to each new loan on non-U.S. securities, collateral of at least 105% of the value of the portfolio securities loaned; and (2) at all times thereafter shall require the borrower to mark-to-market the collateral on a daily basis so that the market value of such collateral does not fall below 100% of the value of securities loaned. The Fund receives payments from borrowers equivalent to the dividends and interest that would have been earned on securities loaned while simultaneously seeking to earn income on the investment of cash collateral. There may be risks of delay in recovery of the securities should the borrower of the securities fail financially. Loans will be made, however, only to borrowers deemed by the Fund’s investment adviser to be of good standing and creditworthy under guidelines established by the Board of Trustees and when, in judgment of the adviser, the consideration which can be earned currently from these securities loans justifies the attendant risks. Loans are subject to termination by the Fund or the borrower at any time, and, therefore, are not considered to be illiquid investments. JPMorgan Chase Bank serves as custodian for the securities lending program of the Fund. JPMorgan Chase Bank receives a fee based on the value of the collateral received from borrowers. The Fund did not have securities on loan as of June 30, 2007. |
(j) | Distributions to Shareholders |
The Fund’s dividends from net investment income, if any, are declared and paid quarterly. The Fund’s distributions from net realized capital gains, if any, are declared and distributed at least annually. | |
Dividends and distributions to shareholders are determined in accordance with federal income tax regulations, which may differ from GAAP. These “book/tax” differences are considered either permanent or temporary in nature. In accordance with the American Institute of Certified Public Accountants Statement of Position 93-2, permanent differences (i.e., reclassification of market discounts, foreign exchange gain/loss, paydowns, and distributions from real estate investment trusts) are reclassified within the capital accounts based on their nature for federal income tax purposes; temporary differences do not require reclassification. These reclassifications have no effect upon the net asset value of the Fund. To the extent distributions exceed current and accumulated earnings and profits for federal income tax purposes, these distributions are reported as distributions of paid-in-capital. |
(k) | Federal Income Taxes |
It is the policy of the Fund to qualify or to continue to qualify as a “regulated investment company” by complying with the provisions available to certain investment companies, as defined in Subchapter M of the U.S. Internal Revenue Code, and to make distributions of net investment income and net realized capital gains sufficient to relieve the Fund from all, or substantially all, federal income taxes. | |
As of June 30, 2007, the tax cost of securities and the breakdown of unrealized appreciation (depreciation) for the Fund was as follows: |
Net | ||||||||||||||||
Unrealized | ||||||||||||||||
Tax Cost of | Unrealized | Unrealized | Appreciation | |||||||||||||
Securities | Appreciation | Depreciation | (Depreciation) | |||||||||||||
$ | 73,463,046 | $ | 11,921,955 | $ | (773,047 | ) | $ | 11,148,908 | ||||||||
(l) | Allocation of Expenses, Income, and Gains and Losses |
Expenses directly attributable to the Fund are charged to the Fund. Expenses not directly attributable to the Fund are allocated proportionately among various or all funds within the Trust. The method used by the Fund for allocating income, fund level expenses, and realized and unrealized gains or losses is based on the fair value of shares |
outstanding relative to net assets. Under this method, each class of shares participates based on the total net asset value of that class’s shares in proportion to the total net assets of the Fund. Expenses specific to a class (such as Rule 12b-1 and administrative services fees) are charged to that class. |
3. Transactions with Affiliates
Under the terms of the Trust’s Investment Advisory Agreement, Nationwide Fund Advisors (formerly, Gartmore Global Asset Management Trust (“GGAMT”)) (“NFA” or the “Advisor”) manages the investment of the assets and supervises the daily business affairs of the Fund. NFA is a wholly-owned subsidiary of Nationwide Financial Services (“NFS”). In addition, NFA provides investment management evaluation services in initially selecting and monitoring, on an ongoing basis, the performance of the subadviser for the Fund. Gartmore Global Partners (the “subadviser”) manages all of the Fund’s investments and has the responsibility for making all investment decisions for the Fund.
Under the terms of the Investment Advisory Agreement, the Fund pays NFA an investment advisory fee based on that Fund’s average daily net assets. Additional information regarding investment advisory fees and subadvisory fees for NFA and the subadviser is as follows for the six months ended June 30, 2007:
Total | ||||||
Base Management Fee | Fees | |||||
Up to $500 million | 0.70% | |||||
$500 million up to $2 billion | 0.65% | |||||
Over $2 billion | 0.60% | |||||
From such fees, pursuant to the subadvisory agreement, NFA paid the subadviser $135,298 for the six months ended June 30, 2007.
The Fund’s base management fee (as adjusted for any applicable breakpoints) may increase or decrease proportionately depending on how the Fund performs relative to its benchmark, the Global Utilities Composite Index, which is comprised of 60% MSCI World Telecommunication Services Index and 40% MSCI World Index. This performance fee is intended to reward or penalize the investment adviser for outperforming or underperforming the Fund’s benchmark.
The calculation of the total management fee is done in two separate steps. First, the Fund calculates a base fee (to be paid at the end of each quarter). The base fee rate results in an annual fee, calculated and accrued daily. The fee rate is applied to the Fund’s average net assets over that quarter. Second, a performance adjustment percentage is applied to the Fund’s average net assets over the 12-month rolling performance period. The performance adjustment amount is then added to (or subtracted from, as applicable) the base fee to arrive at the Fund’s total advisory fee for the most recently completed quarterly sub-period and that total fee is paid at the end of that most recently completed quarter.
The performance fee calculation applies to all of the Fund’s share classes equally, based on the performance of the Class III shares during the performance period. The table below shows the performance adjustment rate applicable to the Fund’s base fee.
Out or Underperformance | Change in Fees | |||||
+/- 1 percentage point | +/- 0.02% | |||||
+/- 2 percentage point | +/- 0.04% | |||||
+/- 3 percentage point | +/- 0.06% | |||||
+/- 4 percentage point | +/- 0.08% | |||||
+/- 5 percentage point | +/- 0.10% | |||||
The performance adjusted advisory fee will be paid quarterly.
Under this performance fee arrangement, the investment adviser can receive a performance fee increase even if the Fund experiences negative performance that still exceeds its benchmark by more than the relevant percentage amount shown above.
Under the terms of a Fund Administration and Transfer Agency Agreement, Nationwide Fund Management, LLC (formerly, Gartmore Investor Services, Inc. (“GISI”)) (“NFM”), a wholly-owned subsidiary of NFS Distributors, Inc. (“NFSDI”), provides the Fund with various administrative and accounting services for the Fund (prior to May 1, 2007, this service was provided by Gartmore SA Capital Trust (“GSA”)), and serves as Transfer and Dividend Disbursing Agent for the Fund (prior to May 1, 2007, this service was provided by GISI, an indirect subsidiary of GSA). The fees for the services provided under this Agreement are calculated based on the Trust’s average daily net assets according to the fee schedule below. The fees are then allocated proportionately among all funds within the Trust in relation to the average daily net assets of each fund and are paid to NFA. NFA pays NFM from these fees for NFM’s services.
Combined Fee Schedule* | ||||||
Up to $1 billion | 0.15% | |||||
$1 billion up to $3 billion | 0.10% | |||||
$3 billion up to $8 billion | 0.05% | |||||
$8 billion up to $10 billion | 0.04% | |||||
$10 billion up to $12 billion | 0.02% | |||||
$12 billion or more | 0.01% | |||||
* | The assets of the Nationwide NVIT Investor Destinations Aggressive Fund, the Nationwide NVIT Investor Destinations Moderately Aggressive Fund, the Nationwide NVIT Investor Destinations Moderate Fund, the Nationwide NVIT Investor Destinations Moderately Conservative Fund, and the Nationwide NVIT Investor Destinations Conservative Fund (collectively, the “Investor Destinations Funds”) are excluded from the Trust asset level amount in order to calculate this asset-based fee. The Investor Destinations Funds do not pay any part of this fee. |
NFA and NFM have entered into agreements with Citi Fund Services Ohio, Inc. (“Citi”), pursuant to which Citi provides sub-administration and sub-transfer agency services, respectively, to the Fund. Effective August 1, 2007, The BISYS Group Inc. was acquired by and became a wholly owned subsidiary of Citi.
Under the terms of a Distribution Plan under Rule 12b-1 of the 1940 Act, Nationwide Fund Distributors, LLC. (formerly, “Gartmore Distribution Services, Inc. (“GDSI”)) (“NFD” or “Distributor”), the Fund’s principal underwriter, is compensated by the Fund for expenses associated with the distribution of the Class II shares of the Fund. NFD is a wholly-owned subsidiary of NFSDI. These fees are based on average daily net assets of Class II shares of the Fund at an annual rate not to exceed 0.25%.
Under the terms of an Administrative Services Plan, the Fund may pay fees to servicing organizations, such as broker-dealers, including NFS, and financial institutions, which agree to provide administrative support services to the shareholders of certain classes. These services include, but are not limited, to the following: establishing and maintaining shareholder accounts; processing purchase and redemption transactions; arranging bank wires; performing shareholder sub-accounting; answering inquires regarding the Fund; and other such services. These fees are based on an annual rate of up to 0.25% of the average daily net assets of each class of shares of the Fund.
For the six months ended June 30, 2007, NFS received $55,436 in Administrative Services Fees from the Fund.
Under the terms of a letter agreement dated September 12, 2006, by and among NFA, the Audit Committee of the Trust and the Trust, the Trust has agreed to reimburse NFA certain costs related to the Fund’s portion of ongoing administration, monitoring and annual (audit) testing of the Trust’s Rule 38a-1 Compliance Program subject to the pre-approval of the Trust’s Audit Committee. For the six months ended June 30, 2007, the Fund’s portion of such costs amounted to $533.
For the six months ended June 30, 2007, the advisers or affiliates of the advisers directly held 6.91% of the shares outstanding of the Fund.
4. Short-Term Trading Fees
The Fund reserves the right to assess a short-term trading fee on certain transactions out of Class III shares that a separate account makes on behalf of a variable insurance contract owner (the “contract owner”). A separate account that redeems Class III shares on behalf of a contract owner may be subject to a 1.00% short-term trading fee if the separate account held the Class III shares on behalf of the contract owner for 60 days or less, unless an exception applies as disclosed in the Fund’s prospectus. The short-term trading fee is paid directly to the Fund and is intended to offset the cost to the Fund of excess brokerage commissions and other costs associated with fluctuations in Fund asset levels and cash flow caused by short-term trading. For purposes of determining whether the short-term trading fee applies, the Class III shares that were held on behalf of the contract owner the longest will be treated as being redeemed first.
For the six months ended June 30, 2007, the Fund had contributions to capital due to collection of redemption fees in the amount of $8,869.
5. Investment Transactions
For the six months ended June 30, 2007, (excluding short-term securities) the Fund had purchases of $51,543,759 and sales of $41,301,023.
6. Bank Loans and Earnings Credit
The Trust has a credit agreement with JPMorgan Chase & Co., the Fund’s custodian bank, permitting the Trust to borrow up to $100,000,000. Borrowings under this arrangement bear interest at the Federal Funds rate plus 0.50%. The interest costs, if any, would be included in other fees in the Statement of Operations. No compensating balances were required under the terms of the line of credit. The line of credit is renewed annually, expiring on June 25, 2008, with a commitment fee of 0.07% per year on $100,000,000. There were no borrowings outstanding under this line of credit for the six months ended June 30, 2007.
The Trust’s custodian bank has agreed to reduce the bank’s fees (earnings credit) when the funds of the Trust maintain cash on deposit in non-interest-bearing custody and Demand Deposit Accounts. Earnings credits, if any, are shown as a reduction of total expenses on the Statement of Operations.
7. Portfolio Investment Risks
Risks Associated with Foreign Securities and Currencies. Investments in securities of foreign issuers carry certain risks not ordinarily associated with investments in securities of U.S. issuers. These risks include future political and economic developments, and the possible imposition of exchange controls or other foreign governmental laws and restrictions. In addition, with respect to certain countries, there is the possibility of expropriation of assets, confiscatory taxation, political or social instability, or diplomatic developments, which could adversely affect investments in those countries.
Certain countries also may impose substantial restrictions on investments in their capital markets by foreign entities, including restrictions on investments in issuers of industries deemed sensitive to relevant national interests. These factors may limit the investment opportunities available and result in a lack of liquidity and high price volatility with respect to securities of issuers from developing countries.
8. Indemnifications
Under the Trust’s organizational documents, the Trust’s Officers and Trustees are indemnified against certain liabilities arising out of the performance of their duties to the Trust. In addition, the Trust has entered into Indemnification Agreements with the Trust’s trustees and certain officers covering similar liabilities. Trust Officers receive no compensation from the Trust for serving as the Trust’s Officers. In addition, in the normal course of business, the Trust enters into
9. Recently Issued Accounting Pronouncements
On July 13, 2006, the Financial Accounting Standards Board (“FASB”) released FASB Interpretation No. 48, Accounting for Uncertainty in Income Taxes (“FIN 48”). FIN 48 provides guidance for how uncertain tax positions should be recognized, measured, presented and disclosed in the financial statements. FIN 48 requires the affirmative evaluation of tax positions taken or expected to be taken in the course of preparing the Fund’s tax returns to determine whether it is more-likely-than-not (i.e., greater than 50 percent) that each tax position will be sustained upon examination by a taxing authority based on the technical merits of the position. A tax position that meets the more-likely-than-not recognition threshold is measured to determine the amount of benefit to recognize in the financial statements. Differences between tax positions taken in a tax return and amounts recognized in the financial statements will generally result in an increase in a liability for taxes payable (or a reduction of a tax refund receivable) and an increase in a deferred tax liability (or a reduction in a deferred tax asset). Adoption of FIN 48 was required no later than the last business day of the first financial statement reporting period for fiscal years beginning after December 15, 2006 and is to be applied to all open tax years as of the effective date. Accordingly, the Fund was required to implement FIN 48 in its net asset value per share (NAV) calculation on June 29, 2007. Management has evaluated the implications of FIN 48 and has concluded that there was no impact to the Fund’s financial statements as of June 29, 2007. The adoption of FIN 48 requires ongoing monitoring and analysis, future conclusions reached by management may be different and result in adjustments to the Fund’s NAV and financial statements.
In September 2006, the FASB issued Statement on Financial Accounting Standards (“SFAS”) No. 157, “Fair Value Measurements.” This standard establishes a single authoritative definition of fair value, sets out a framework for measuring fair value and requires additional disclosures about fair value measurements. SFAS No. 157 applies to fair value measurements already required or permitted by existing standards. SFAS No. 157 is effective for financial statements issued for fiscal years beginning after November 15, 2007 and interim periods within those fiscal years. The changes to current accounting principles generally accepted in the United States of America from the application of this Statement relate to the definition of fair value, the methods used to measure fair value, and the expanded disclosures about fair value measurements. As of June 30, 2007, the Fund does not believe the adoption of SFAS No. 157 will impact the financial statement amounts; however, additional disclosures may be required about the inputs used to develop the measurements and the effect of certain of the measurements on changes in net assets for the period.
Trustees who are not Interested Persons (as defined in the 1940 Act) and Officers of the Trust as of
Number of Portfolios | ||||||||||
Position(s) Held | in the | |||||||||
with the Trust | Principal Occupation(s) | Nationwide Fund | Other | |||||||
Name, Address | and Length of | During Past | Complex Overseen | Directorships | ||||||
and Year of Birth | Time Served1 | Five Years | by Trustee | Held by Trustee2 | ||||||
Charles E. Allen c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1948 | Trustee since July 2000 | Mr. Allen is Chairman, Chief Executive Officer and President of Graimark Realty Advisors, Inc. (real estate development, investment and asset management). | 89 | None | ||||||
Paula H.J. Cholmondeley c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1947 | Trustee since July 2000 | Ms. Cholmondeley was Vice President and General Manager of Sappi Fine Paper North America from April 2000 through December 2003. | 89 | Director of Dentsply International, Inc. (dental products), Ultralife Batteries, Inc., Terex Corporation (construction equipment), Minerals Technology, Inc. (specialty chemicals) and Albany International Corp. (paper industry) | ||||||
C. Brent DeVore3 c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1940 | Trustee since 1990 | Dr. DeVore is President of Otterbein College. | 89 | None | ||||||
Phyllis Kay Dryden c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1947 | Trustee since December 2004 | Ms. Dryden was a partner of Mitchell Madison, a management consulting company from January 2006 until December 2006; she is currently a consultant with the company. Ms. Dryden was formerly Managing Partner of march FIRST, a global management consulting firm. | 89 | None | ||||||
Barbara L. Hennigar c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1935 | Trustee since July 2000 | Retired. | 89 | None | ||||||
Number of Portfolios | ||||||||||
Position(s) Held | in the | |||||||||
with the Trust | Principal Occupation(s) | Nationwide Fund | Other | |||||||
Name, Address | and Length of | During Past | Complex Overseen | Directorships | ||||||
and Year of Birth | Time Served1 | Five Years | by Trustee | Held by Trustee2 | ||||||
Barbara I. Jacobs c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1950 | Trustee since December 2004 | Ms. Jacobs served as Chairman of the Board of Directors of KICAP Network Fund, a European (United Kingdom) hedge fund, from January 2001 through January 2006. From 1998-2003, Ms. Jacobs was also a Managing Director and European Portfolio Manager of CREF Investments (Teachers Insurance and Annuity Association-College Retirement Equities Fund). | 89 | None | ||||||
Douglas F. Kridler c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1955 | Trustee since September 1997 | Mr. Kridler has served as the President and Chief Executive Officer of the Columbus Foundation (a Columbus, OH-based foundation which manages over 1,300 individual endowment funds) since February 2002. Prior to January 31, 2002, Mr. Kridler was the President of the Columbus Association for the Performing Arts and Chairman of the Greater Columbus Convention and Visitors Bureau. | 89 | None | ||||||
Michael D. McCarthy c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1947 | Trustee since December 2004 | Retired. Mr. McCarthy was Chairman of VMAC (commodity swaps) from October 2002 until January 2007; and a partner of Pineville Properties LLC (a commercial real estate development firm) from September 2000 until January 2007. | 89 | None | ||||||
David C. Wetmore c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1948 | Trustee since 1995 and Chairman since February 2005 | Retired. | 89 | None | ||||||
1 | Length of time served includes time served with the Trust’s predecessors. | |
2 | Directorships held in (1) any other investment companies registered under the 1940 Act, (2) any company with a class of securities registered pursuant to Section 12 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or (3) any company subject to the requirements of Section 15(d) of the Exchange Act. | |
3 | Mr. DeVore has served as President of Otterbein College since 1984. Mark Thresher, President and Chief Operating Officer of Nationwide Financial Services, Inc. (“NFS”) has served as a member of the Board of Trustees of Otterbein College since 2000, currently serves as one of 30 of its trustees, and is currently one of two Vice Chairmen of the Board. Each of Nationwide Fund Advisors (“NFA”), the Funds’ investment adviser, and Nationwide Fund Distributors LLC (“NFD”), principal underwriter to the Trust, is a wholly-owned subsidiary of NFS. | |
Additional information regarding the Trustees and Officers may be found in the Trust’s Statement of Additional Information, which is available without charge upon request, by calling 800-848-0920. |
Trustees who are Interested Persons (as defined in the 1940 Act) and/or Officers of the Trust as of
Number of Portfolios | ||||||||||
Position(s) Held | in the | |||||||||
with the Trust | Principal Occupation(s) | Nationwide Fund | Other | |||||||
Name, Address | and Length of | During Past | Complex Overseen | Directorships | ||||||
and Year of Birth | Time Served1 | 5 Years | by Trustee | Held by Trustee 2 | ||||||
Arden L. Shisler c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1941 | Trustee since February 2000 | Retired. Mr. Shisler is the former President and Chief Executive Officer of KeB Transport, Inc., a trucking firm (2000 through 2002). He served as a consultant to KeB from January 2003 through December 2004. Since 1992, Mr. Shisler has also been Chairman of the Board for Nationwide Mutual Insurance Company.3 | 89 | Director of Nationwide Financial Services, Inc., Chairman of Nationwide Mutual Insurance Company3 | ||||||
John H. Grady Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1961 | President & Chief Executive Officer since December 2006 | Mr. Grady is President, and Chief Executive Officer of Nationwide Funds Group which includes Nationwide Fund Advisors,3 Nationwide Fund Management LLC,3 Nationwide Fund Distributors LLC 3 and NWD Investments,2 the asset management operations of Nationwide Mutual Insurance Company, which includes Morley Capital Management, Inc.,2 Nationwide Separate Accounts LLC,2 NorthPointe Capital LLC,2 and Nationwide SA Capital Trust2. From March 2004 until March 2006, Mr. Grady was Chief Executive Officer of Constellation Investment Management Co., L.P. (registered investment adviser), and President and Chief Executive Officer of Constellation Funds Group (registered investment companies). He also was President of Constellation Investment Distribution Co., Inc. (registered broker-dealer) from March 2004 until June 2006. From February 2001 until February 2004, Mr. Grady was Chief Operating and Chief Legal Officer; Managing Director, Mutual Funds Group, Turner Investment Partners, Inc. (registered investment adviser); Executive Vice President of Turner Funds and Turner Institutional Portfolios (registered investment companies); and President, Turner Investment Distributors, Inc. (registered broker-dealer). | N/A | None | ||||||
Gerald J. Holland Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1951 | Treasurer since March 2001 | Mr. Holland is Senior Vice President—Operations for Nationwide Funds Group3. | N/A | N/A | ||||||
Number of Portfolios | ||||||||||
Position(s) Held | in the | |||||||||
with the Trust | Principal Occupation(s) | Nationwide Fund | Other | |||||||
Name, Address | and Length of | During Past | Complex Overseen | Directorships | ||||||
and Year of Birth | Time Served1 | 5 Years | by Trustee | Held by Trustee 2 | ||||||
Michael A. Krulikowski Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1959 | Chief Compliance Officer from June 2004 to August 20074 | Mr. Krulikowski is Vice President and Chief Compliance Officer of Nationwide Funds Group3, Morley Capital Management, Inc.3, Nationwide SA Capital Trust (since 1999)3, and Nationwide Separate Accounts LLC (since August 2005).3 Since June 2004, Mr. Krulikowski has also served as Chief Compliance Officer of the Trust. From November 1999 through May 2007, he served as Vice President and Chief Compliance Officer of NorthPointe Capital LLC. 3 | N/A | N/A | ||||||
Eric E. Miller Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1953 | Secretary since December 2002 | Mr. Miller is Senior Vice President, General Counsel, and Assistant Secretary for Nationwide Funds Group3 and NWD Investments.2 From August 2000 to August 2002, Mr. Miller was a Partner with Stradley Ronon Stevens & Young, LLP. | N/A | N/A | ||||||
1 | Length of time served includes time served with the Trust’s predecessors. | |
2 | Directorships held in (1) any other investment companies registered under the 1940 Act, (2) any company with a class of securities registered pursuant to Section 12 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or (3) any company subject to the requirements of Section 15(d) of the Exchange Act. | |
3 | This position is held with an affiliated person or principal underwriter of the Trust. | |
4 | Effective August 3, 2007, the Board of Trustees approved Carol Baldwin Moody as Chief Compliance Officer of the Trust. Since November 2005, Ms. Moody has been Senior Vice President, Chief Compliance Officer of Nationwide Financial Services, Nationwide Life Insurance Company, Nationwide Life and Annuity Insurance Company, and Nationwide Investment Advisors, LLC. From February 2004-November 2005, she was Chief Compliance Officer of TIAA-CREF and from April 2000-February 2004, she was Managing Director and General Counsel, TCW/ Latin America Partners, LLC and Baeza & Co., LLC. | |
Federal law requires the Trust, each of its investment advisers and sub-advisers to adopt procedures for voting proxies (“Proxy Voting Guidelines”) and to provide a summary of those Proxy Voting Guidelines used to vote the securities held by the Funds. The Funds’ proxy voting policies and procedures are available without charge (i) upon request, by calling 800-848-0920, (ii) on the Funds’ website at www.nationwidefunds.com, or (iii) on the Securities and Exchange Commission’s website at www.sec.gov. |
A. Renewal of Investment Advisory Agreement
(i) | General Information Regarding the Board’s Review of Investment Advisory Agreements |
The Trust’s investment advisory agreements (each an “Advisory Agreement”) with its investment adviser and, as applicable, sub-advisers (together, the “Adviser”) must be approved for an initial term no greater than two years, and renewed at least annually thereafter, (i) by the vote of the Trustees or by a vote of the shareholders of each series or fund of the Trust (individually a “Fund” ), and (ii) by the vote of a majority of the Trustees who are not parties to the Advisory Agreement or “interested persons” of any party thereto (the “Independent Trustees”) cast in person at a meeting called for the purpose of voting on such approval.
The Board meets quarterly and takes into account throughout the year matters bearing on each Fund’s Advisory Agreement. The Board and its standing committees consider at each meeting factors that are relevant to the annual renewal of an Advisory Agreement, including the services and support provided to a Fund and its shareholders.
On December 6, 2006, the Independent Trustees first met in person with their independent legal counsel (“Independent Legal Counsel”) to consider information provided by the Adviser and others to assist the Trustees in considering whether to renew each Fund’s Advisory Agreement for a one year term beginning May 1, 2007. Immediately following such meeting of the Independent Trustees, all Trustees met in person with the Adviser, Trust counsel, Independent Legal Counsel and others to consider such matters, and give preliminary consideration to information bearing on continuation of each Advisory Agreement. The primary purpose of the December 6 and 7, 2006 meeting was to ensure that the Trustees had ample opportunity to consider matters they deemed relevant in considering the continuation of an Advisory Agreement, and to request any additional information they considered reasonably necessary to their deliberations.
In preparation for the December 6 and 7, 2006 meeting the Trustees were provided, at the request of the Trustees, with a wide range of information to assist in their deliberations, including (i) reports from Lipper Inc. describing a Fund’s (a) performance rankings (where “first quintile” denotes the best performance) (over multiple years ended September 30, 2006) compared with performance groups and performance universes created by Lipper (and in some cases, customized peer groups created by the Adviser) of similar or peer group funds, and (b) expense rankings (where “first quintile” denotes the lowest fees and expenses) comparing the Fund’s contractual advisory fee and total expenses with expense groups and expense universes created by Lipper of similar or peer group funds, (ii) information from the Adviser describing the Fund’s performance (over multiple years ended September 30, 2006) compared with its benchmark and Lipper categories, (iii) for Funds under “close review,” copies of letters from the Adviser to the portfolio manager of each such Fund, together with the portfolio manager’s written response describing the reasons for the Fund’s underperformance (iv) information from the Adviser describing performance for the months of October and November, 2006, and annual performance for the year ended November 30, 2006, (v) reports from the Adviser describing the Adviser’s profitability in providing services under an Advisory Agreement, together with an explanation of Adviser’s methodology in calculating its profitability, (vi) information from the Adviser describing any fees paid to the Adviser for managing similar, non-affiliated institutional accounts, including the range of fee levels for such accounts, and (vii) information from the Adviser describing ancillary benefits, in addition to fees for serving as investment adviser, derived by the Adviser as a result of being investment adviser for a Fund, including, where applicable, information on soft-dollar benefits and fees inuring to the Adviser’s affiliates for serving as the Trust’s administrator, fund accountant and transfer agent.
At the December 6 and 7, 2006 meeting, the Trustees reviewed, considered and discussed, among themselves and with the Adviser, Trust counsel and Independent Legal Counsel, among other things, the information described above, and: (i) the nature, extent and quality of services provided by the Adviser under each Advisory Agreement, (ii) the investment performance of each Fund and the Adviser, (iii) the costs of the services provided by the Adviser under the Advisory Agreement and the profits realized by the Adviser thereunder, (iv) the extent to which economies of scale may be present and, if so, whether they are being shared with a Fund’s shareholders, (v) comparisons of the Adviser’s fees under the Advisory Agreement with investment advisory fees paid by peer group funds to their investment advisers and paid by non-affiliated institutional clients to the Adviser for managing similar accounts, and (vi) any ancillary benefits inuring to the Adviser and its affiliates as a result of being investment adviser for the Trust. The Trustees also considered, where
As part of the December 6 and 7, 2006 Board meeting, the Independent Trustees developed a list of follow-up matters and questions and asked that Adviser respond to such matters and questions at the contract approval meeting of the Board of Trustees to be held on January 11, 2007.
At the January 11, 2007 meeting of the Board of Trustees of the Trust, the Board received and considered information provided by the Adviser in follow-up from the December 6 and 7, 2006 Board meeting and, after consulting among themselves, and with the Adviser, Trust counsel and Independent Legal Counsel, concluded unanimously to renew the Advisory Agreement for the reasons set forth in the following section. In determining whether to renew the Advisory Agreement for the Fund, the Board ultimately reached a determination, with the assistance of Trust counsel and Independent Legal Counsel, that the renewal of the Advisory Agreement and the compensation to be received by the Adviser under the Advisory Agreement is consistent with the Board’s fiduciary duty under applicable law.
(ii) | Board Conclusions Regarding the Fund’s Advisory Agreement |
The Board considered that the Fund had outperformed its benchmark, the MSCI World Utilities Index (40%)/ MSCI World Telecom Index (60%), for the one- and three-year periods. The Board also considered that the performance of the Fund’s Class III shares had ranked in the first quintile of the Fund’s Lipper-constructed Performance Group over the one-and three-year periods and in the second-quintile over the two- and four-year periods. The Board considered that the performance has been very good over the periods considered. Based on its review, and giving particular weight to the nature and quality of the resources dedicated by the adviser and subadviser to maintain relative performance, the Board concluded that the nature, extent, and quality of the services provided to the Fund will benefit the Fund’s shareholders.
The Board also considered that the Fund’s contractual advisory fee and breakpoints placed the Fund in the third quintile of its Lipper-constructed Expense Group, and the Fund’s total expenses placed the Fund in the second quintile. The Board also considered that the Fund had implemented a performance fee structure, which is intended to either reward or penalize the adviser for outperforming or underperforming, respectively, the Fund’s benchmark. The Board concluded that the Fund’s management fee and total expenses were reasonable in light of the services that the Fund receives and the other factors considered.
The Board considered that the Fund’s adviser reported a pre-tax profit margin for investment management services during each of the twelve month-periods ended September 30, 2006 and 2005. The Board considered the costs of the services provided by and the profits realized by the Fund’s adviser in connection with the operation of the Fund and determined that the amount of profit is a fair entrepreneurial profit for the management of the Fund.
Based upon its evaluation of all of the conclusions noted above, and after considering all material factors with respect to the Fund, the Board ultimately concluded that the advisory fee structure is fair and reasonable, and that the Advisory Agreement (and, if applicable, Sub-Advisory Agreement) with respect to the Fund, should be renewed.
B. Approval of New Advisory Agreement
At its January 11, 2007 meeting, the Board also unanimously approved a new investment advisory agreement (the “New Agreement”) for the Fund with Nationwide Fund Advisors, (“NFA”) the then-current adviser to each of the series of the Trust to become effective upon the closing of the acquisition of NFA by Nationwide Financial Services, Inc. (“NFS”) from Nationwide Corporation (“NWC”) which closed on April 30, 2007 (the “Transaction”). In approving the New Agreement, the Board considered NFA’s capacity to continue to provide the services needed to operate a sophisticated investment management business and to support the management of each of the series. The Board also took into account the information provided to them at their regular quarterly meetings with NFA’s senior management with respect to the Fund, including the information provided by management at the Fund’s annual Section 15(c) meetings on
C. Submission of Matters to a Vote of Security Holders:
On April 25, 2007, a Special Meeting of Shareholders was held* (the “April 25 Meeting”) at which shareholders of the Funds** set forth below were asked:
Proposal 1:
To approve a new investment advisory agreement, on behalf of their Fund, between Nationwide Fund Advisors (formerly “Gartmore Mutual Fund Capital Trust”) (the “Adviser”) and Nationwide Variable Insurance Trust (formerly “Gartmore Variable Insurance Trust”) (the “Trust”).
Number of Shares | ||||||
Fund | Cast/Not Cast | Percentages | ||||
Federated NVIT High Income Bond Fund (Formerly Federated GVIT High Income Bond Fund) | FOR AGAINST ABSTAIN TOTAL | 30,051,703.188 shares 618,245.021 shares 1,813,550.431 shares 32,483,498.640 shares | 92.514% 1.903% 5.583% | |||
NVIT International Index Fund (Formerly GVIT International Index Fund) | FOR AGAINST ABSTAIN TOTAL | 4,322,203.982 shares 2,758.318 shares 135,636.840 shares 4,460,599.140 shares | 96.897% 0.062% 3.041% | |||
NVIT International Value Fund (Formerly GVIT International Value Fund) | FOR AGAINST ABSTAIN TOTAL | 20,032,843.199 shares 333,588.902 shares 1,093,293.879 shares 21,459,725.980 shares | 93.351% 1.554% 5.095% | |||
NVIT Mid Cap Index Fund (Formerly GVIT Mid Cap Index Fund) | FOR AGAINST ABSTAIN TOTAL | 35,380,179.120 shares 631,117.844 shares 1,565,714.306 shares 37,577,011.270 shares | 94.154% 1.679% 4.167% | |||
NVIT S&P 500 Index Fund (Formerly GVIT S&P 500 Index Fund) | FOR AGAINST ABSTAIN TOTAL | 56,119,814.230 shares 666,195.542 shares 1,944,898.888 shares 58,730,908.660 shares | 95.554% 1.134% 3.312% |
Number of Shares | ||||||
Fund | Cast/Not Cast | Percentages | ||||
Nationwide Multi-Manager NVIT Small Cap Growth Fund (Formerly GVIT Small Cap Growth Fund) | FOR AGAINST ABSTAIN TOTAL | 7,632,918.513 shares 149,458.111 shares 451,583.036 shares 8,233,959.660 shares | 92.700% 1.816% 5.484% | |||
Nationwide Multi-Manager NVIT Small Cap Value Fund (Formerly GVIT Small Cap Value Fund) | FOR AGAINST ABSTAIN TOTAL | 48,649,396.525 shares 979,183.753 shares 2,786,133.102 shares 52,414,713.380 shares | 92.816% 1.868% 5.316% | |||
Nationwide Multi-Manager NVIT Small Company Fund (Formerly GVIT Small Company Fund) | FOR AGAINST ABSTAIN TOTAL | 29,903,181.700 shares 838,774.923 shares 2,006,741.307 shares 32,748,697.930 shares | 91.311% 2.561% 6.128% | |||
Gartmore NVIT Developing Markets Fund (Formerly Gartmore GVIT Developing Markets Fund) | FOR AGAINST ABSTAIN TOTAL | 21,0177,889.443 shares 424,272.958 shares 1,543,850.729 shares 23,046,013.130 shares | 91.460% 1.841% 6.699% | |||
Gartmore NVIT Emerging Markets Fund (Formerly Gartmore GVIT Emerging Markets Fund) | FOR AGAINST ABSTAIN TOTAL | 17,050,534.593 shares 526,574.722 shares 881,608.905 shares 18,458,718.220 shares | 92.371% 2.853% 4.776% | |||
Nationwide NVIT Global Financial Services Fund (Formerly Gartmore GVIT Global Financial Services Fund) | FOR AGAINST ABSTAIN TOTAL | 1,554,847.333 shares 19,539.033 shares 52,206.494 shares 1,626,592.860 shares | 95.589% 1.201% 3.210% | |||
Nationwide NVIT Global Health Sciences Fund (Formerly Gartmore GVIT Global Health Sciences Fund) | FOR AGAINST ABSTAIN TOTAL | 4,722,963.678 shares 157,979.030 shares 207,642.222 shares 5,088,584.930 shares | 92.815% 3.104% 4.081% | |||
Nationwide NVIT Global Technology and Communications Fund (Formerly Gartmore GVIT Global Technology and Communications Fund) | FOR AGAINST ABSTAIN TOTAL | 8,585,472.039 shares 102,267.977 shares 489,577.634 shares 9,177,317.650 shares | 93.551% 1.114% 5.335% | |||
Gartmore NVIT Global Utilities Fund (Formerly Gartmore GVIT Global Utilities Fund) | FOR AGAINST ABSTAIN TOTAL | 4,123,270.549 shares 122,001.533 shares 240,276.088 shares 4,485,548.170 shares | 91.923% 2.720% 5.357% | |||
Nationwide NVIT Government Bond Fund (Formerly Gartmore GVIT Government Bond Fund) | FOR AGAINST ABSTAIN TOTAL | 88,471,567.462 shares 1,825,645.181 shares 5,841,990.727 shares 96,139,203.370 shares | 92.024% 1.899% 6.077% | |||
Nationwide NVIT Growth Fund (Formerly Gartmore GVIT Growth Fund) | FOR AGAINST ABSTAIN TOTAL | 14,931,435.904 shares 409,826.402 shares 1,259,945.064 shares 16,601,207.370 shares | 89.942% 2.469% 7.589% |
Number of Shares | ||||||
Fund | Cast/Not Cast | Percentages | ||||
Gartmore NVIT International Growth Fund (Formerly Gartmore GVIT International Growth Fund) | FOR AGAINST ABSTAIN TOTAL | 6,251,419.070 shares 139,618.548 shares 290,025.592 shares 6,681,063.210 shares | 93.569% 2.090% 4.341% | |||
Nationwide NVIT Investor Destinations Aggressive Fund (Formerly Gartmore GVIT Investor Destinations Aggressive Fund) | FOR AGAINST ABSTAIN TOTAL | 49,489,224.549 shares 1,385,396.474 shares 3,696,272.337 shares 54,570,893.360 shares | 90.688% 2.539% 6.773% | |||
Nationwide NVIT Investor Destinations Conservative Fund (Formerly Gartmore GVIT Investor Destinations Conservative Fund) | FOR AGAINST ABSTAIN TOTAL | 23,091,965.887 shares 314,935,884 shares 2,292,355.179 shares 25,699,256.950 shares | 89.855% 1.225% 8.920% | |||
Nationwide NVIT Investor Destinations Moderate Fund (Formerly Gartmore GVIT Investor Destinations Moderate Fund) | FOR AGAINST ABSTAIN TOTAL | 188,902,093.059 shares 3,018,924.590 shares 16,359,690.401 shares 208,280,708.050 shares | 90.696% 1.449% 7.855% | |||
Nationwide NVIT Investor Destinations Moderately Aggressive Fund (Formerly Gartmore GVIT Investor Destinations Moderately Aggressive Fund) | FOR AGAINST ABSTAIN TOTAL | 134,792,622.920 shares 3,489,207.264 shares 9,304,197.656 shares 147,586,027.840 shares | 91.332% 2.364% 6.304% | |||
Nationwide NVIT Investor Destinations Moderately Conservative Fund (Formerly Gartmore GVIT Investor Destinations Moderately Conservative Fund) | FOR AGAINST ABSTAIN TOTAL | 49,627,123.216 shares 856,088.634 shares 3,507,215.650 shares 53,990,427.500 shares | 91.918% 1.586% 6.496% | |||
Nationwide NVIT Mid Cap Growth Fund (Formerly Gartmore GVIT Mid Cap Growth Fund) | FOR AGAINST ABSTAIN TOTAL | 10,879,584.971 shares 352,594.958 shares 717,792.971 shares 11,949,972.900 shares | 91.043% 2.950% 6.007% | |||
Nationwide NVIT Money Market Fund II (Formerly Gartmore GVIT Money Market Fund II) | FOR AGAINST ABSTAIN TOTAL | 221,774,863.241 shares 12,322,482.494 shares 16,471,740.875 shares 250,569,086.610 shares | 88.508% 4.918% 6.574% | |||
Nationwide NVIT Money Market Fund (Formerly Gartmore GVIT Money Market Fund) | FOR AGAINST ABSTAIN TOTAL | 1,578,331,008.328 shares 32,372,133.671 shares 112,652,123.301 shares 1,723,355,265.300 shares | 91.585% 1.878% 6.537% | |||
NVIT Nationwide Fund (Formerly Gartmore GVIT Nationwide Fund) | FOR AGAINST ABSTAIN TOTAL | 125,423,274.735 shares 2,767,979.467 shares 8,762,255.828 shares 136,953,510.030 shares | 91.581% 2.021% 6.398% | |||
NVIT Nationwide Leaders Fund (Formerly Gartmore GVIT Nationwide Leaders Fund) | FOR AGAINST ABSTAIN TOTAL | 2,298,504.956 shares 29,630.469 shares 71,637.755 shares 2,399,773.180 shares | 95.780% 1.235% 2.985% |
Number of Shares | ||||||
Fund | Cast/Not Cast | Percentages | ||||
Nationwide NVIT U.S. Growth Leaders Fund (Formerly Gartmore GVIT U.S. Growth Leaders Fund) | FOR AGAINST ABSTAIN TOTAL | 4,972,094.773 shares 122,623.161 shares 174,625.606 shares 5,269,343.540 shares | 94.359% 2.327% 3.314% | |||
Gartmore NVIT Worldwide Leaders Fund (Formerly Gartmore GVIT Worldwide Leaders Fund) | FOR AGAINST ABSTAIN TOTAL | 2,666,862.487 shares 47,702.491 shares 118,719.882 shares 2,833,284.860 shares | 94.126% 1.684% 4.190% | |||
JP Morgan NVIT Balanced Fund (Formerly JP Morgan GVIT Balanced Fund) | FOR AGAINST ABSTAIN TOTAL | 15,966,867.546 shares 259,004.324 shares 1,339,385.200 shares 17,565,257.070 shares | 90.900% 1.475% 7.625% | |||
Van Kampen NVIT Comstock Value Fund (Formerly Van Kampen GVIT Comstock Value Fund) | FOR AGAINST ABSTAIN TOTAL | 27,737,008.009 shares 502,564.164 shares 1,824,670.107 shares 30,064,242.280 shares | 92.259% 1.672% 6.069% | |||
Van Kampen NVIT Multi Sector Bond Fund (Formerly Van Kampen GVIT Multi Sector Bond Fund) | FOR AGAINST ABSTAIN TOTAL | 21,253,297.665 shares 484,100.920 shares 1,803,963.645 shares 23,541,362.230 shares | 90.281% 2.056% 7.663% | |||
At the April 25 Meeting, shareholders of the Nationwide NVIT Mid Cap Growth Fund were also asked to approve a new investment subadvisory agreement among the Adviser, the Trust and NorthPointe Capital LLC. The voting results with respect to that proposal are set forth below:
Proposal 2:
Number of Shares | ||||||
Fund | Cast/Not Cast | Percentages | ||||
Nationwide NVIT Mid Cap Growth Fund (Formerly Gartmore GVIT Mid Cap Growth Fund) | FOR AGAINST ABSTAIN TOTAL | 10,862,827.499 shares 414,574.660 shares 672,570.741 shares 11,949,972.900 shares | 90.903% 3.469% 5.628% | |||
* | This meeting was previously adjourned on April 23, 2007. | |
** | Fund names were changed effective May 1, 2007 to reflect “Nationwide”/“NVIT” branding to coincide with the sale of Nationwide Fund Advisors, Inc. by Nationwide Corporation to its majority-owned subsidiary, Nationwide Financial Services, Inc. |
June 30, 2007 (Unaudited)
Contents | ||
6 | Statement of Investments | |
9 | Statement of Assets and Liabilities | |
10 | Statement of Operations | |
11 | Statements of Changes in Net Assets | |
13 | Financial Highlights | |
14 | Notes to Financial Statements |
Statement Regarding Availability of Proxy Voting Record.
SAR-GFS (8/07) | ![]() |
Dear Fellow Shareholder:
Since I last wrote to you, our mutual funds have enjoyed another period of solid performance, and the corporate realignment that was in progress is now finished.
On May 1, 2007, Nationwide Financial Services, Inc. (NFS), completed its acquisition of the Philadelphia-based retail mutual fund operations of NWD Investment Management, Inc. (formerly, “Gartmore Global Investments, Inc.”), from Nationwide Corporation, a subsidiary of Nationwide Mutual Insurance Company. Effective that date, the acquired entities were renamed Nationwide Funds Group (NFG), and the Gartmore Funds were renamed the Nationwide Funds to better align with the Nationwide® brand. Although the corporate ownership and fund names have changed, I can assure you that NFG intends to maintain as much continuity as possible with the Funds and key personnel.
Thank you, shareholders, for approving the new investment advisory agreement that was required due to the change in corporate ownership. The new agreement is identical in all material respects to the original agreement that it replaces, with the exception of the section pertaining to the vote by the shareholders of the NVIT Mid Cap Growth Fund to approve NorthPointe Capital®, LLC (NorthPointe) as sub-adviser to that particular Fund.
Market Overview: January 1-June 30, 2007
Share prices in general were buoyed in part by better-than-expected first-quarter 2007 earnings and a flurry of mergers and acquisitions, many of these spurred by readily available funding from private equity firms. In June, investors grew more cautious amid surging crude oil prices, a sudden spike in long-term interest rates, and the meltdown of two hedge funds that had exposure to the subprime mortgage market. Looking abroad, a weak U.S. dollar aided foreign stocks, as reflected in the 11.09% advance of the Morgan Stanley Capital International Europe, Australasia and Far East (MSCI EAFE®) Index. Emerging market performance was particularly robust.
The bond market struggled during the first half of 2007. While short-term interest rates remained stable, reflecting the Federal Reserve Board’s decision in June to leave the target federal funds rate at 5.25%, longer-term rates climbed during the first half of 2007, depressing bond prices and forcing the Lehman Brothers® U.S. Aggregate Index to settle for a modest 0.97% return.
We at NFG thank you for your understanding and cooperation throughout our recent transition period. We emerge from this period energized for the future, and we look forward to serving your investment needs for a long time to come.
Nationwide Funds Group
PAST PERFORMANCE IS NO GUARANTEE OF FUTURE RESULTS.
Nationwide Funds are advised by Nationwide Fund Advisors (NFA). NFA is a wholly-owned subsidiary of Nationwide Financial Services. Nationwide Financial Services is a wholly-owned subsidiary of Nationwide Corporation. All of the common stock of Nationwide Corporation is held by Nationwide Mutual (95.2%) and Nationwide Mutual Fire Insurance Company (4.8%), each of which is a mutual company owned by its policyholders.
Nationwide Funds Group (NFG) is the mutual fund arm of Nationwide Financial Services (NYSE: NFS). Based in Conshohocken, Pa., a suburb of Philadelphia, NFG is comprised of Nationwide Fund Advisors, Nationwide Fund Distributors, LLC, and Nationwide Fund Management, LLC. Together, these provide advisory, distribution, and administration services respectively to the Nationwide Funds, and manage more than $43.5 billion in assets as of June 30, 2007, of which more than $12 billion are in “fund of funds” designed to provide asset allocation across several types of investments and asset classes.
Lehman Brothers (LB) U.S. Aggregate Index: An unmanaged, market value-weighted index of investment-grade, fixed-rate debt issues (including government, corporate, asset-backed, and mortgage-backed securities with maturities of one year or more) that is generally representative of the bond market as a whole.
Morgan Stanley Capital International Europe, Australasia and Far East (MSCI EAFE®) Index: An unmanaged, free float-adjusted, market capitalization-weighted index that is designed to measure the performance of stocks in developed markets outside the United States and Canada.
Standard & Poor’s 500® (S&P 500) Index: An unmanaged, market capitalization-weighted index of 500 widely held stocks of large-cap U.S. companies that gives a broad look at how the stock prices of those companies have performed.
Views expressed within are those of Nationwide Funds Group as of the date noted, are subject to change at any time, and may not come to pass.
This report is for informational purposes only, and is not intended as an offer or recommendation with respect to the purchase or sale of any security, option, future, or other derivatives in such securities.
Investing in mutual funds involves risk, including possible loss of principal.
Investors should carefully consider a fund’s investment objectives, risks, fees, charges, and expenses before investing any money. To obtain this and other fund information, please call 800-848-0920 to request a prospectus, or download a prospectus at www.nationwidefunds.com. Please read the prospectus carefully before investing any money.
Nationwide Funds distributed by Nationwide Fund Distributors LLC (formerly Gartmore Distribution Services, Inc.), Member NASD. 1200 River Road, Suite 1000, Conshohocken, Pa. 19428.
As a shareholder of the Fund, you incur two types of costs: (1) transaction costs, including sales charges (loads) paid on purchase payments and redemption fees; and (2) ongoing costs, including investment advisory fees, administration fees, distribution fees and other Fund expenses. The examples below are 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. Per SEC requirements, the examples assume that you had a $1,000 investment in the Class at the beginning of the reporting period, January 1, 2007, and continued to hold your shares at the end of the reporting period, June 30, 2007.
Actual Expenses
Hypothetical Example for Comparison Purposes
Please note that the expenses shown in the table are meant to highlight your ongoing costs only and do not reflect any transaction costs, such as sales charges (loads) or redemption fees. Therefore, the second line for each Class in 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 transaction costs were included, your costs would have been higher. The examples also assume all dividends and distributions have been reinvested.
Schedule of Shareholder Expenses
Nationwide NVIT Global Financial Services Fund | ||||||||||||||||||||||
Beginning | Ending | Expenses Paid | Annualized | |||||||||||||||||||
Account Value, | Account | During Period* | Expense Ratio* | |||||||||||||||||||
January 1, 2007 | Value, | |||||||||||||||||||||
June 30, 2007 | ||||||||||||||||||||||
Class I | Actual | $ | 1,000.00 | $ | 1,041.30 | $ | 6.17 | 1.22% | ||||||||||||||
Hypothetical | 1 | $ | 1,000.00 | $ | 1,018.75 | $ | 6.12 | 1.22% | ||||||||||||||
Class II | Actual | $ | 1,000.00 | $ | 1,040.10 | $ | 7.44 | 1.47% | ||||||||||||||
Hypothetical | 1 | $ | 1,000.00 | $ | 1,017.51 | $ | 7.38 | 1.47% | ||||||||||||||
Class III | Actual | $ | 1,000.00 | $ | 1,041.40 | $ | 6.02 | 1.19% | ||||||||||||||
Hypothetical | 1 | $ | 1,000.00 | $ | 1,018.90 | $ | 5.97 | 1.19% | ||||||||||||||
* | Expenses are equal to the Fund’s annualized expense ratio multiplied by the average account value over the period multiplied by 181/365 (to reflect the one-half year period). The expense ratio presented represents a six-month, annualized ratio in accordance with SEC guidelines. The expenses reported above do not include the effect of additional expenses imposed by variable annuity contracts. | |
1 | Represents the hypothetical 5% return before expenses. |
Asset Allocation | ||||
Common Stock | 99.2% | |||
Repurchase Agreements | 1.1% | |||
Rights | 0.0% | |||
Liabilities in excess of other assets | -0.3% | |||
100.0% |
Top Holdings* | ||||
American International Group, Inc. | 2.9% | |||
National Bank of Greece SA | 2.9% | |||
UniCredito Italiano SPA | 2.5% | |||
BNP Paribas | 2.4% | |||
Royal Bank of Canada | 2.4% | |||
Commonwealth Bank of Australia | 2.3% | |||
ING Groep NV | 2.3% | |||
HSBC Holdings PLC | 2.2% | |||
Banco Bilbao Vizcaya Argentaria SA | 2.2% | |||
Axa | 2.1% | |||
Other | 75.8% | |||
100.0% |
Top Industries | ||||
Commercial Banks | 41.2% | |||
Diversified Financial Services | 18.0% | |||
Insurance | 12.9% | |||
Capital Markets | 12.0% | |||
Banks | 3.5% | |||
Real Estate Investment Trusts (REITs) | 3.1% | |||
Consumer Finance | 2.8% | |||
Real Estate Management & Development | 2.0% | |||
Thrifts & Mortgage Finance | 1.2% | |||
Distributor | 0.7% | |||
Other | 2.6% | |||
100.0% |
Top Countries | ||||
United States | 42.8% | |||
United Kingdom | 8.5% | |||
Japan | 7.4% | |||
Australia | 6.0% | |||
Greece | 4.7% | |||
France | 4.5% | |||
Germany | 4.2% | |||
Netherlands | 4.1% | |||
Canada | 3.5% | |||
Switzerland | 3.5% | |||
Other | 10.8% | |||
100.0% |
* | For purpose of listing top holdings, repurchase agreements are included as part of Other. |
Nationwide NVIT Global Financial Services Fund
Common Stock (99.2%) | ||||||||
Shares or | ||||||||
Principal Amount | Value | |||||||
AUSTRALIA (6.0%) (a) | ||||||||
Capital Markets (0.8% | ||||||||
Macquarie Bank Ltd. | 3,700 | $ | 265,690 | |||||
Commercial Banks (4.4%) | ||||||||
Australia & New Zealand Banking Group Ltd. | 27,400 | 672,817 | ||||||
Commonwealth Bank of Australia | 15,510 | 725,427 | ||||||
1,398,244 | ||||||||
Real Estate Investment Trust (REIT) (0.8%) | ||||||||
Westfield Group | 15,800 | 266,534 | ||||||
1,930,468 | ||||||||
BELGIUM (0.8%) (a) | ||||||||
Diversified Financial Services (0.8%) | ||||||||
Fortis NV | 5,810 | 246,458 | ||||||
BERMUDA (1.4%) | ||||||||
Consumer Finance (0.9%) | ||||||||
Lazard Ltd. | 6,340 | 285,490 | ||||||
Insurance (0.5%) | ||||||||
Arch Capital Group Ltd.* | 2,340 | 169,744 | ||||||
455,234 | ||||||||
CANADA (3.5%) | ||||||||
Banks (3.5%) | ||||||||
Royal Bank of Canada | 14,210 | 755,465 | ||||||
Toronto-Dominion Bank | 5,290 | 361,906 | ||||||
1,117,371 | ||||||||
CHILE (1.2%) | ||||||||
Commercial Bank (1.2%) | ||||||||
Banco Santander Chile SA ADR - CL | 8,030 | 397,806 | ||||||
CHINA (1.3%) (a) | ||||||||
Commercial Bank (1.3%) | ||||||||
China Construction Bank, Class H | 630,020 | 433,248 | ||||||
FRANCE (4.5%) (a) | ||||||||
Commercial Bank (2.4%) | ||||||||
BNP Paribas | 6,450 | 766,072 | ||||||
Insurance (2.1%) | ||||||||
Axa | 15,730 | 676,091 | ||||||
1,442,163 | ||||||||
GERMANY (4.2%) (a) | ||||||||
Capital Markets (1.2%) | ||||||||
Deutsche Bank AG | 2,720 | 393,617 | ||||||
Commercial Bank (1.0%) | ||||||||
Commerzbank AG | 6,790 | 323,819 | ||||||
Diversified Financial Services (2.0%) | ||||||||
Deutsche Boerse AG | 5,680 | 637,681 | ||||||
1,355,117 | ||||||||
GREECE (4.7%) (a) | ||||||||
Commercial Banks (4.7%) | ||||||||
Alpha Bank AE | 18,950 | 594,021 | ||||||
National Bank of Greece SA | 16,390 | 933,137 | ||||||
1,527,158 | ||||||||
HONG KONG (1.1%) (a) | ||||||||
Real Estate Management & Development (1.1%) | ||||||||
Hang Lung Group Ltd. | 79,550 | 359,286 | ||||||
IRELAND (0.6%) | ||||||||
Transportation (0.6%) | ||||||||
Genesis Lease Ltd. ADR - IE | 6,870 | 188,238 | ||||||
ITALY (2.5%) (a) | ||||||||
Commercial Bank (2.5%) | ||||||||
UniCredito Italiano SPA | 90,104 | 804,686 | ||||||
JAPAN (7.4%) (a) | ||||||||
Commercial Banks (4.4%) | ||||||||
Mitsubishi UFJ Financial Group, Inc. | 48 | 529,057 | ||||||
Mizuho Financial Group, Inc. | 50 | 345,469 | ||||||
Sumitomo Mitsui Financial Group, Inc. | 40 | 372,942 | ||||||
Suruga Bank Ltd. | 13,800 | 173,936 | ||||||
1,421,404 | ||||||||
Consumer Finance (1.3%) | ||||||||
ORIX Corp. | 1,580 | 416,519 | ||||||
Insurance (0.8%) | ||||||||
Millea Holdings, Inc. | 6,500 | 267,262 | ||||||
Real Estate Management & Development (0.9%) | ||||||||
Mitsubishi Estate Co. Ltd. | 4,000 | 108,536 | ||||||
Sumitomo Realty & Development Co. Ltd. | 5,200 | 169,366 | ||||||
277,902 | ||||||||
2,383,087 | ||||||||
NETHERLANDS (4.1%) | ||||||||
Aerospace & Defense (0.6%) | ||||||||
AerCap Holdings NV ADR - NL* | 5,770 | 184,640 | ||||||
Common Stock (continued) | ||||||||
Shares or | ||||||||
Principal Amount | Value | |||||||
NETHERLANDS (continued) | ||||||||
Commercial Bank (1.2%) (a) | ||||||||
ABN AMRO Holding NV | 8,590 | $ | 393,829 | |||||
Diversified Financial Services (2.3%) (a) | ||||||||
ING Groep NV | 16,460 | 724,389 | ||||||
1,302,858 | ||||||||
SPAIN (2.2%) (a) | ||||||||
Commercial Bank (2.2%) | ||||||||
Banco Bilbao Vizcaya Argentaria SA | 28,760 | 703,247 | ||||||
SWITZERLAND (3.5%) (a) | ||||||||
Capital Markets (3.5%) | ||||||||
Credit Suisse Group | 6,710 | 476,467 | ||||||
UBS AG | 10,700 | 640,064 | ||||||
1,116,531 | ||||||||
UNITED KINGDOM (8.5%) (a) | ||||||||
Capital Markets (1.1%) | ||||||||
Amvescap PLC | 27,450 | 353,660 | ||||||
Commercial Banks (6.9%) | ||||||||
Barclays PLC | 29,320 | 407,885 | ||||||
HBOS PLC | 24,530 | 482,440 | ||||||
HSBC Holdings PLC | 39,500 | 723,192 | ||||||
Lloyds TSB Group PLC | 54,340 | 604,002 | ||||||
2,217,519 | ||||||||
Real Estate Investment Trust (REIT) (0.5%) | ||||||||
British Land Co. PLC | 6,610 | 176,861 | ||||||
2,748,040 | ||||||||
UNITED STATES (41.7%) | ||||||||
Capital Markets (5.4%) | ||||||||
Charles Schwab Corp. | 12,850 | 263,682 | ||||||
Highland Distressed Opportunities, Inc. | 9,110 | 129,817 | ||||||
Lehman Brothers Holding, Inc. | 6,410 | 477,673 | ||||||
Northern Trust Corp. | 5,870 | 377,089 | ||||||
T. Rowe Price Group, Inc. | 9,600 | 498,144 | ||||||
1,746,405 | ||||||||
Commercial Banks (9.0%) | ||||||||
Bank of the Ozarks, Inc. | 5,170 | 144,088 | ||||||
BB&T Corp. | 7,180 | 292,082 | ||||||
PNC Bank Corp. | 5,590 | 400,132 | ||||||
SunTrust Banks, Inc. | 2,690 | 230,641 | ||||||
U.S. Bancorp | 9,340 | 307,753 | ||||||
Wachovia Corp. | 11,740 | 601,675 | ||||||
Wells Fargo & Co. | 16,190 | 569,402 | ||||||
Wintrust Financial Corp. | 3,650 | 160,053 | ||||||
Zions Bancorp | 2,270 | 174,586 | ||||||
2,880,412 | ||||||||
Consumer Finance (0.6%) | ||||||||
SLM Corp. | 3,270 | 188,287 | ||||||
Distributor (0.7%) | ||||||||
ProLogis Trust | 3,780 | 215,082 | ||||||
Diversified Financial Services (12.9%) | ||||||||
Blackrock, Inc. | 1,750 | 274,033 | ||||||
Chicago Mercantile Exchange Holdings, Inc. | 880 | 470,237 | ||||||
Citigroup, Inc. | 11,060 | 567,267 | ||||||
Goldman Sachs Group, Inc. | 2,950 | 639,412 | ||||||
Interactive Brokers Group, Inc., Class A* | 7,060 | 191,538 | ||||||
IntercontinentalExchange, Inc.* | 3,010 | 445,028 | ||||||
International Securities Exchange Holdings, Inc. | 2,360 | 154,226 | ||||||
J.P. Morgan Chase & Co. | 11,900 | 576,555 | ||||||
Merrill Lynch & Co., Inc. | 2,300 | 192,234 | ||||||
Morgan Stanley | 4,600 | 385,848 | ||||||
State Street Corp. | 3,690 | 252,396 | ||||||
4,148,774 | ||||||||
Insurance (9.5%) | ||||||||
AFLAC, Inc. | 4,980 | 255,972 | ||||||
American International Group, Inc. | 13,330 | 933,500 | ||||||
Assurant, Inc. | 2,950 | 173,814 | ||||||
First Mercury Financial Corp.* | 10,300 | 215,991 | ||||||
HCC Insurance Holdings, Inc. | 12,220 | 408,270 | ||||||
Marsh & McLennan Cos., Inc. | 7,610 | 234,997 | ||||||
Principal Financial Group, Inc. | 5,290 | 308,354 | ||||||
Progressive Corp. (The) | 6,300 | 150,759 | ||||||
Prudential Financial, Inc. | 4,000 | 388,920 | ||||||
3,070,577 | ||||||||
IT Services (0.6%) | ||||||||
Wright Express Corp.* | 5,360 | 183,687 | ||||||
Real Estate Investment Trusts (REITs) (1.8%) | ||||||||
CBRE Realty Finance, Inc. | 9,080 | 107,961 | ||||||
Health Care REIT, Inc. | 3,380 | 136,417 | ||||||
iStar Financial, Inc. | 4,250 | 188,402 | ||||||
SL Green Realty Corp. | 1,200 | 148,668 | ||||||
581,448 | ||||||||
Nationwide NVIT Global Financial Services Fund (Continued)
Common Stock (continued) | ||||||||
Shares or | ||||||||
Principal Amount | Value | |||||||
UNITED STATES (continued) | ||||||||
Thrifts & Mortgage Finance (1.2%) | ||||||||
Countrywide Credit Industries, Inc. | 5,400 | $ | 196,290 | |||||
PMI Group, Inc. | 4,380 | 195,656 | ||||||
391,946 | ||||||||
13,406,618 | ||||||||
Total Common Stocks (Cost $30,574,734) | 31,917,614 | |||||||
Repurchase Agreements (1.1%) | ||||||||
Nomura Securities, 5.20%, dated 06/29/07, due 07/02/06, repurchase price $356,149, collateralized by U.S. Government Agency mortgages with a market value of $363,114 | $ | 355,994 | 355,994 | |||||
Rights (0.0%) | ||||||||
AUSTRALIA (0.0%) | ||||||||
Real Estate Investment Trust (REIT) (0.0%) | ||||||||
Westfield Group Rights | 15,800 | 582 | ||||||
Total Investments (Cost $30,930,728) (b) — 100.3% | 32,274,190 | |||||||
Liabilities in excess of other assets — (0.3)% | (111,184 | ) | ||||||
NET ASSETS — 100.0% | $ | 32,163,006 | ||||||
* | Denotes a non-income producing security. | |
(a) | Fair Valued Security. | |
(b) | See notes to financial statements for tax unrealized appreciation (depreciation) of securities. |
ADR | American Depository Receipt | |
CL | Chile | |
IE | Ireland | |
NL | Netherlands | |
REIT | Real Estate Investment Trust |
At June 30, 2007, the Fund’s open forward foreign currency contracts were as follows:
Unrealized | ||||||||||||||||||
Delivery | Contract | Market | Appreciation/ | |||||||||||||||
Currency | Date | Value | Value | (Depreciation) | ||||||||||||||
Short Contracts: | ||||||||||||||||||
Swiss Franc | 07/02/07 | (125,255 | ) | (126,219 | ) | (964 | ) | |||||||||||
Total Short Contracts | $ | (125,255 | ) | $ | (126,219 | ) | $ | (964 | ) | |||||||||
See accompanying notes to financial statements.
Nationwide NVIT | ||||||
Global Financial | ||||||
Services Fund | ||||||
Assets: | ||||||
Investments, at value (cost $30,574,734) | $ | 31,918,196 | ||||
Repurchase agreements, at cost and value | 355,994 | |||||
Total Investments | 32,274,190 | |||||
Foreign currencies, at value (cost $4,368) | 4,370 | |||||
Interest and dividends receivable | 53,120 | |||||
Receivable for capital shares issued | 559 | |||||
Receivable for investments sold | 126,219 | |||||
Reclaims receivable | 26,055 | |||||
Prepaid expenses | 427 | |||||
Total Assets | 32,484,940 | |||||
Liabilities: | ||||||
Payable to custodian | 4,298 | |||||
Payable for investments purchased | 177,435 | |||||
Unrealized depreciation on forward foreign currency contracts | 964 | |||||
Payable for capital shares redeemed | 50,654 | |||||
Accrued expenses and other payables: | ||||||
Investment advisory fees | 73,601 | |||||
Fund administration and transfer agent fees | 2,454 | |||||
Distribution fees | 377 | |||||
Administrative servicing fees | 2,531 | |||||
Compliance program costs | 471 | |||||
Other | 9,149 | |||||
Total Liabilities | 321,934 | |||||
Net Assets | $ | 32,163,006 | ||||
Represented by: | ||||||
Capital | $ | 27,754,701 | ||||
Accumulated net investment income | 129,303 | |||||
Accumulated net realized gains from investment transactions and foreign currency transactions | 2,934,801 | |||||
Net unrealized appreciation on investments and translation of assets and liabilities denominated in foreign currencies | 1,344,201 | |||||
Net Assets | $ | 32,163,006 | ||||
Net Assets: | ||||||
Class I Shares | $ | 8,187,997 | ||||
Class II Shares | 1,800,070 | |||||
Class III Shares | 22,174,939 | |||||
Total | $ | 32,163,006 | ||||
Shares outstanding (unlimited number of shares authorized): | ||||||
Class I Shares | 617,956 | |||||
Class II Shares | 136,311 | |||||
Class III Shares | 1,672,555 | |||||
Total | 2,426,822 | |||||
Net asset value and offering price per share (Net assets by class divided by shares outstanding by class, respectively.): | ||||||
Class I Shares | $ | 13.25 | ||||
Class II Shares | $ | 13.21 | ||||
Class III Shares | $ | 13.26 | ||||
9
Nationwide NVIT | |||||
Global Financial | |||||
Services Fund | |||||
INVESTMENT INCOME: | |||||
Interest income | $ | 8,286 | |||
Dividend income | 570,399 | ||||
Foreign tax withholding | (42,358 | ) | |||
Total Income | 536,327 | ||||
Expenses: | |||||
Investment advisory fees | 145,397 | ||||
Fund administration and transfer agent fees | 18,153 | ||||
Distribution fees Class II Shares | 2,315 | ||||
Administrative servicing fees Class I Shares | 5,582 | ||||
Administrative servicing fees Class II Shares | 1,303 | ||||
Administrative servicing fees Class III Shares | 12,670 | ||||
Custodian fees | 6,887 | ||||
Trustee fees | 834 | ||||
Compliance program costs (Note 3) | 249 | ||||
Printing fees | 11,448 | ||||
Other | 2,185 | ||||
Total expenses before earnings credit | 207,023 | ||||
Earnings credit (Note 6) | (56 | ) | |||
Net Expenses | 206,967 | ||||
Net Investment Income | 329,360 | ||||
REALIZED/ UNREALIZED GAINS (LOSSES) FROM INVESTMENTS: | |||||
Net realized gains on investment transactions | 3,009,962 | ||||
Net realized losses on foreign currency transactions | (29,125 | ) | |||
Net realized gains on investment transactions and foreign currency transactions | 2,980,837 | ||||
Net change in unrealized depreciation on investments and translation of assets and liabilities denominated in foreign currencies | (1,975,904 | ) | |||
Net realized/unrealized gains (losses) on investments and translation of assets and liabilities denominated in foreign currencies | 1,004,933 | ||||
CHANGE IN NET ASSETS RESULTING FROM OPERATIONS | $ | 1,334,293 | |||
10
Nationwide NVIT Global | |||||||||
Financial Services Fund | |||||||||
Six Months Ended | Year Ended | ||||||||
June 30, 2007 | December 31, 2006 | ||||||||
(Unaudited) | |||||||||
FROM INVESTMENT ACTIVITIES: | |||||||||
Operations: | |||||||||
Net investment income | $ | 329,360 | $ | 445,804 | |||||
Net realized gains on investment transactions and foreign currency transactions | 2,980,837 | 5,064,350 | |||||||
Net change in unrealized appreciation/ depreciation on investments and translation of assets and liabilities denominated in foreign currencies | (1,975,904 | ) | 518,206 | ||||||
Change in net assets resulting from operations | 1,334,293 | 6,028,360 | |||||||
Distributions to shareholders from: | |||||||||
Net investment income: | |||||||||
Class I | (44,029 | ) | (134,195 | ) | |||||
Class II | (7,542 | ) | (28,911 | ) | |||||
Class III | (128,114 | ) | (462,900 | ) | |||||
Net realized gains: | |||||||||
Class I | (283,167 | ) | (908,968 | ) | |||||
Class II | (62,037 | ) | (213,065 | ) | |||||
Class III | (765,163 | ) | (2,771,293 | ) | |||||
Change in net assets from shareholder distributions | (1,290,052 | ) | (4,519,332 | ) | |||||
Change in net assets from capital transactions | (1,880,098 | ) | 3,647,235 | ||||||
Change in net assets | (1,835,857 | ) | 5,156,263 | ||||||
Net Assets: | |||||||||
Beginning of period | 33,998,863 | 28,842,600 | |||||||
End of period | $ | 32,163,006 | $ | 33,998,863 | |||||
Accumulated net investment income (loss) at end of period | $ | 129,303 | $ | (20,372 | ) | ||||
CAPITAL TRANSACTIONS: | |||||||||
Class I Shares | |||||||||
Proceeds from shares issued | $ | 2,467,889 | $ | 2,894,000 | |||||
Dividends reinvested | 327,196 | 1,043,161 | |||||||
Cost of shares redeemed (a) | (2,628,795 | ) | (1,917,754 | ) | |||||
166,290 | 2,019,407 | ||||||||
Class II Shares | |||||||||
Proceeds from shares issued | 658 | – | |||||||
Dividends reinvested | 69,579 | 241,976 | |||||||
Cost of shares redeemed (a) | (137,407 | ) | (143,311 | ) | |||||
(67,170 | ) | 98,665 | |||||||
Class III Shares | |||||||||
Proceeds from shares issued | 2,808,858 | 13,305,459 | |||||||
Dividends reinvested | 893,273 | 3,234,190 | |||||||
Cost of shares redeemed (a) | (5,681,349 | ) | (15,010,486 | ) | |||||
(1,979,218 | ) | 1,529,163 | |||||||
Change in net assets from capital transactions | $ | (1,880,098 | ) | $ | 3,647,235 | ||||
11
Nationwide NVIT Global | |||||||||
Financial Services Fund | |||||||||
Six Months Ended | Year Ended | ||||||||
June 30, 2007 | December 31, 2006 | ||||||||
(Unaudited) | |||||||||
SHARE TRANSACTIONS: | |||||||||
Class I Shares | |||||||||
Issued | 179,492 | 209,879 | |||||||
Reinvested | 24,678 | 78,524 | |||||||
Redeemed | (191,681 | ) | (140,963 | ) | |||||
12,489 | 147,440 | ||||||||
Class II Shares | |||||||||
Reinvested | 5,269 | 18,268 | |||||||
Redeemed | (9,951 | ) | (10,703 | ) | |||||
(4,682 | ) | 7,565 | |||||||
Class III Shares | |||||||||
Issued | 204,167 | 982,604 | |||||||
Reinvested | 67,313 | 243,265 | |||||||
Redeemed | (417,246 | ) | (1,093,848 | ) | |||||
(145,766 | ) | 132,021 | |||||||
Total change in shares | (137,959 | ) | 287,026 | ||||||
(a) | Includes redemption fees, if any. |
12
Distributions | ||||||||||||||||||||
Investment Activities | ||||||||||||||||||||
Net Realized | ||||||||||||||||||||
and | ||||||||||||||||||||
Net Asset | Unrealized | Total | ||||||||||||||||||
Value, | Net | Gains | from | Net | ||||||||||||||||
Beginning | Investment | (Losses) on | Investment | Investment | ||||||||||||||||
of Period | Income | Investments | Activities | Income | ||||||||||||||||
Class I Shares | ||||||||||||||||||||
Period Ended December 31, 2002 (e) | $ | 10.23 | – | (1.27 | ) | (1.27 | ) | (0.01 | ) | |||||||||||
For the Year Ended December 31, 2003 | $ | 8.96 | 0.10 | 3.58 | 3.68 | (0.05 | ) | |||||||||||||
For the Year Ended December 31, 2004 | $ | 11.39 | 0.17 | 2.19 | 2.36 | (0.17 | ) | |||||||||||||
For the Year Ended December 31, 2005 | $ | 12.82 | 0.19 | 1.18 | 1.37 | (0.25 | ) | |||||||||||||
For the Year Ended December 31, 2006 | $ | 12.66 | 0.20 | 2.34 | 2.54 | (0.26 | ) | |||||||||||||
For the Six Months Ended June 30, 2007 (Unaudited) | $ | 13.25 | 0.13 | 0.41 | 0.54 | (0.07 | ) | |||||||||||||
Class II Shares | ||||||||||||||||||||
Period Ended December 31, 2003 (g) | $ | 8.46 | 0.04 | 4.11 | 4.15 | (0.04 | ) | |||||||||||||
For the Year Ended December 31, 2004 | $ | 11.37 | 0.11 | 2.22 | 2.33 | (0.14 | ) | |||||||||||||
For the Year Ended December 31, 2005 | $ | 12.80 | 0.14 | 1.18 | 1.32 | (0.22 | ) | |||||||||||||
For the Year Ended December 31, 2006 | $ | 12.62 | 0.15 | 2.35 | 2.50 | (0.22 | ) | |||||||||||||
For the Six Months Ended June 30, 2007 (Unaudited) | $ | 13.21 | 0.12 | 0.41 | 0.53 | (0.06 | ) | |||||||||||||
Class III Shares | ||||||||||||||||||||
For the Year Ended December 31, 2002 | $ | 10.13 | 0.04 | (1.21 | ) | (1.17 | ) | (0.01 | ) | |||||||||||
For the Year Ended December 31, 2003 | $ | 8.96 | 0.13 | 3.55 | 3.68 | (0.05 | ) | |||||||||||||
For the Year Ended December 31, 2004 | $ | 11.39 | 0.14 | 2.23 | 2.37 | (0.17 | ) | |||||||||||||
For the Year Ended December 31, 2005 | $ | 12.83 | 0.20 | 1.17 | 1.37 | (0.25 | ) | |||||||||||||
For the Year Ended December 31, 2006 | $ | 12.67 | 0.19 | 2.35 | 2.54 | (0.26 | ) | |||||||||||||
For the Six Months Ended June 30, 2007 (Unaudited) | $ | 13.26 | 0.14 | 0.41 | 0.55 | (0.08 | ) | |||||||||||||
[Additional columns below]
[Continued from above table, first column(s) repeated]
Distributions | ||||||||||||||||||||||||||||
Ratio of | ||||||||||||||||||||||||||||
Paid-in | Net Assets | Expenses | ||||||||||||||||||||||||||
Net | Capital from | Net Asset | at End of | to Average | ||||||||||||||||||||||||
Realized | Total | Redemption | Value, End | Total | Period | Net Assets | ||||||||||||||||||||||
Gains | Distributions | Fees | of Period | Return (a) | (000s) | (b) | ||||||||||||||||||||||
Class I Shares | ||||||||||||||||||||||||||||
Period Ended December 31, 2002 (e) | – | (0.01 | ) | 0.01 | $ | 8.96 | (12.26% | ) | $ | 218 | 1.37% | |||||||||||||||||
For the Year Ended December 31, 2003 | (1.21 | ) | (1.26 | ) | 0.01 | $ | 11.39 | 41.45% | $ | 3,121 | 1.27% | |||||||||||||||||
For the Year Ended December 31, 2004 | (0.77 | ) | (0.94 | ) | 0.01 | $ | 12.82 | 20.99% | $ | 4,011 | 1.27% | |||||||||||||||||
For the Year Ended December 31, 2005 | (1.28 | ) | (1.53 | ) | – | $ | 12.66 | 11.15% | $ | 5,799 | 1.34% | |||||||||||||||||
For the Year Ended December 31, 2006 | (1.69 | ) | (1.95 | ) | – | $ | 13.25 | 20.32% | $ | 8,024 | 1.24% | |||||||||||||||||
For the Six Months Ended June 30, 2007 (Unaudited) | (0.47 | ) | (0.54 | ) | – | $ | 13.25 | 4.13% | $ | 8,188 | 1.22% | |||||||||||||||||
Class II Shares | ||||||||||||||||||||||||||||
Period Ended December 31, 2003 (g) | (1.21 | ) | (1.25 | ) | 0.01 | $ | 11.37 | 49.51% | $ | 913 | 1.51% | |||||||||||||||||
For the Year Ended December 31, 2004 | (0.77 | ) | (0.91 | ) | 0.01 | $ | 12.80 | 20.76% | $ | 1,879 | 1.52% | |||||||||||||||||
For the Year Ended December 31, 2005 | (1.28 | ) | (1.50 | ) | – | $ | 12.62 | 10.79% | $ | 1,685 | 1.59% | |||||||||||||||||
For the Year Ended December 31, 2006 | (1.69 | ) | (1.91 | ) | – | $ | 13.21 | 20.08% | $ | 1,863 | 1.49% | |||||||||||||||||
For the Six Months Ended June 30, 2007 (Unaudited) | (0.47 | ) | (0.53 | ) | – | $ | 13.21 | 4.01% | $ | 1,800 | 1.47% | |||||||||||||||||
Class III Shares | ||||||||||||||||||||||||||||
For the Year Ended December 31, 2002 | – | (0.01 | ) | 0.01 | $ | 8.96 | (11.41% | ) | $ | 6,009 | 1.31% | |||||||||||||||||
For the Year Ended December 31, 2003 | (1.21 | ) | (1.26 | ) | 0.01 | $ | 11.39 | 41.46% | $ | 11,634 | 1.22% | |||||||||||||||||
For the Year Ended December 31, 2004 | (0.77 | ) | (0.94 | ) | 0.01 | $ | 12.83 | 21.13% | $ | 19,634 | 1.24% | |||||||||||||||||
For the Year Ended December 31, 2005 | (1.28 | ) | (1.53 | ) | – | $ | 12.67 | 11.17% | $ | 21,359 | 1.29% | |||||||||||||||||
For the Year Ended December 31, 2006 | (1.69 | ) | (1.95 | ) | – | $ | 13.26 | 20.34% | $ | 24,112 | 1.20% | |||||||||||||||||
For the Six Months Ended June 30, 2007 (Unaudited) | (0.47 | ) | (0.55 | ) | – | $ | 13.26 | 4.14% | $ | 22,175 | 1.19% | |||||||||||||||||
[Additional columns below]
[Continued from above table, first column(s) repeated]
Ratios/Supplemental Data | ||||||||||||||||||
Ratio of | ||||||||||||||||||
Ratio of | Net Investment | |||||||||||||||||
Ratio of Net | Expenses | Income | ||||||||||||||||
Investment | (Prior to | (Prior to | ||||||||||||||||
Income | Reimbursements) | Reimbursements) | ||||||||||||||||
to Average | to Average | to Average | Portfolio | |||||||||||||||
Net Assets (b) | Net Assets (b)(c) | Net Assets (b)(c) | Turnover (d) | |||||||||||||||
Class I Shares | ||||||||||||||||||
Period Ended December 31, 2002 (e) | 0.30% | (f) | (f) | 211.21% | ||||||||||||||
For the Year Ended December 31, 2003 | 1.47% | (f) | (f) | 261.68% | ||||||||||||||
For the Year Ended December 31, 2004 | 1.19% | (f) | (f) | 127.69% | ||||||||||||||
For the Year Ended December 31, 2005 | 1.24% | (f) | (f) | 217.57% | ||||||||||||||
For the Year Ended December 31, 2006 | 1.32% | (f) | (f) | 236.59% | ||||||||||||||
For the Six Months Ended June 30, 2007 (Unaudited) | 1.94% | 1.22% | 1.94% | 70.91% | ||||||||||||||
Class II Shares | ||||||||||||||||||
Period Ended December 31, 2003 (g) | 1.20% | (f) | (f) | 261.68% | ||||||||||||||
For the Year Ended December 31, 2004 | 1.00% | (f) | (f) | 127.69% | ||||||||||||||
For the Year Ended December 31, 2005 | 1.08% | (f) | (f) | 217.57% | ||||||||||||||
For the Year Ended December 31, 2006 | 1.08% | (f) | (f) | 236.59% | ||||||||||||||
For the Six Months Ended June 30, 2007 (Unaudited) | 1.67% | 1.47% | 1.67% | 70.91% | ||||||||||||||
Class III Shares | ||||||||||||||||||
For the Year Ended December 31, 2002 | 0.66% | (f) | (f) | 211.21% | ||||||||||||||
For the Year Ended December 31, 2003 | 1.57% | (f) | (f) | 261.68% | ||||||||||||||
For the Year Ended December 31, 2004 | 1.28% | (f) | (f) | 127.69% | ||||||||||||||
For the Year Ended December 31, 2005 | 1.36% | (f) | (f) | 217.57% | ||||||||||||||
For the Year Ended December 31, 2006 | 1.36% | (f) | (f) | 236.59% | ||||||||||||||
For the Six Months Ended June 30, 2007 (Unaudited) | 1.94% | 1.19% | 1.94% | 70.91% | ||||||||||||||
(a) | Not annualized for periods less than one year. | |
(b) | Annualized for periods less than one year. | |
(c) | During the period, certain fees were waived and/or reimbursed. If such waivers/reimbursements had not occurred, the ratios would have been as indicated. | |
(d) | Portfolio turnover is calculated on the basis of the Fund as a whole without distinguishing among the classes of shares. | |
(e) | For the period from May 10, 2002 (commencement of operations) through December 31, 2002. | |
(f) | There were no fee reductions during the period. | |
(g) | For the period from March 28, 2003 (commencement of operations) through December 31, 2003. |
See accompanying notes to financial statements.
1. Organization
Nationwide Variable Insurance Trust (“NVIT” or the “Trust”) is an open-end management investment company, organized under the laws of Delaware by an amended and restated Agreement and Declaration of Trust, dated October 28, 2004, as amended to date. Prior to May 1, 2007, the Trust was named “Gartmore Variable Insurance Trust”. The Trust, originally created under the laws of Massachusetts as a Massachusetts business trust pursuant to a Declaration of Trust dated, as of June 30, 1981, and as subsequently amended, redomesticated as a Delaware Statutory Trust after the close of trading on April 29, 2005, and is registered under the Investment Company Act of 1940, as amended (the “1940 Act”). The redomestication was a change in statutory status and did not affect the operations of the Trust. As of June 30, 2007, the Trust had authorized an unlimited number of shares of beneficial interest, without par value (“shares”). The Trust currently offers shares to life insurance company separate accounts to fund the benefits under variable life insurance or annuity policies. To date, only the separate accounts of Nationwide Life Insurance Company and Nationwide Life and Annuity Insurance Company (collectively, “Nationwide”) have purchased shares of the Nationwide NVIT Global Financial Services Fund (the “Fund”), (formerly, “Gartmore GVIT Global Financial Services Fund”). The Trust currently operates forty (40) separate series, or mutual funds, each with its own investment objectives and strategies. This report contains the financial statements and financial highlights of the Fund.
2. Summary of Significant Accounting Policies
The following is a summary of significant accounting policies followed by the Fund in the preparation of its financial statements. The policies are in conformity with accounting principles generally accepted in the United States of America (“GAAP”). The preparation of financial statements requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of income and expenses for the period. Actual results could differ from those estimates.
(a) | Security Valuation |
Securities for which market quotations are readily available are valued at current market value as of “Valuation Time.” Valuation Time is as of the close of regular trading on the New York Stock Exchange (usually 4 p.m. Eastern time). Equity securities are valued at the last quoted sale price or, if there is no sale price, the last quoted bid price provided by an independent pricing service approved by the Trust’s Board of Trustees (“Board of Trustees”). Securities traded on NASDAQ are valued at the NASDAQ official closing price. Prices are taken from the primary market or exchange in which each security trades. | |
Most securities listed on a foreign exchange are valued either at fair value (see description below) or at the last sale price at the close of the exchange on which the security is principally traded. Foreign securities, currencies, and other assets and liabilities denominated in foreign currencies are translated into U.S. dollars at the exchange rate of said currencies against the U.S. dollar, as of Valuation Time, as provided by an independent pricing service approved by the Board of Trustees. | |
Debt (including defaulted issues) and other fixed income securities (other than short-term obligations) are valued at the last quoted bid price and/or by using a combination of daily quotes and matrix evaluations provided by an independent pricing service, the use of which has been approved by the Board of Trustees. Short-term debt securities, such as commercial paper and U.S. Treasury Bills having a remaining maturity of 60 days or less at the time of purchase, are considered to be “short-term” and are valued at amortized cost, which approximates market value. | |
Securities for which market quotations are not readily available, or for which an independent pricing service does not provide a value or provides a value that does not represent fair value in the judgment of the Fund’s investment adviser or designee, are valued at fair value under procedures approved by the Board of Trustees. The “Fair Value” of these securities is determined in good faith by taking into account relevant factors and surrounding circumstances. Methods utilized to obtain a “Fair Value” may include the following non-exclusive list of acceptable methods: (i) a multiple of earnings; (ii) the discount from market value of a similar, freely traded security; (iii) the yield-to-maturity |
for debt issues; or (iv) a consolidation of the methods. The Trust’s Valuation & Operations Committee considers a non-exclusive list of factors to arrive at the appropriate method of determining “Fair Value.” For example, fair value determinations are required for securities whose value is affected by a “significant” event that materially affects the value of a domestic or foreign security which occurs subsequent to the time of the close of the principal market on which such domestic or foreign security trades and before the Valuation Time (i.e., a “subsequent event”). Typically, this will involve events occurring after the close of a foreign market on which a security trades and before the next Valuation Time. | |
The Fund values foreign securities at fair value in the circumstances described below. Generally, trading in foreign securities markets is completed each day at various times prior to the Valuation Time. Due to the time differences between the closings of the relevant foreign securities exchanges and the Valuation Time for the Fund, the Fund will fair value its foreign investments when it is determined that the market quotations for the foreign investments either are not readily available or are unreliable and, therefore, do not represent fair value. When the fair value prices are utilized, these prices will attempt to reflect the impact of the U.S. financial markets’ perceptions and trading activities on the Fund’s foreign investments since the last closing prices of the foreign investments were calculated on their primary foreign securities markets or exchanges. For these purposes, the Board of Trustees has determined that movements in relevant indices or other appropriate market indicators, after the close of the foreign securities exchanges, may demonstrate that market quotations are unreliable, and may trigger fair value pricing for certain securities. Consequently, fair valuation of portfolio securities may occur on a daily basis. |
(b) | Repurchase Agreements |
The Fund may enter into repurchase agreements with an entity which is a member of the Federal Reserve System or which is a “primary dealer” (as designated by the Federal Reserve Bank of New York) in U.S. Government obligations. The repurchase price generally equals the price paid by the Fund plus interest negotiated on the basis of current short-term rates, which may be more or less than the rate on the underlying portfolio securities. The seller under a repurchase agreement is required to maintain the value of the collateral held pursuant to the agreement at a market value equal to or greater than the repurchase price (including accrued interest). Collateral subject to repurchase agreements is held by the Fund’s custodian or another qualified sub-custodian or in the Federal Reserve/ Treasury book-entry system. If the counterparty defaults and the fair value of the collateral declines, realization of the collateral by the Fund may be delayed or limited. The Fund may transfer uninvested cash balances into a pooled cash account. These balances are invested in one or more repurchase agreements, with the counterparty of Nomura Securities, which is fully collateralized by U.S. Government Agency Mortgages. |
(c) | Foreign Currency Transactions |
The accounting records of the Fund are maintained in U.S. dollars. Foreign currency amounts are translated into U.S. dollars at the current rate of exchange to determine the value of investments, assets and liabilities. The Fund may enter into foreign currency contracts in connection with purchases or sales of securities denominated in a foreign currency. Purchases and sales of securities, and income and expenses, are translated at the prevailing rate of exchange on the respective date of these transactions. The Fund does not isolate that portion of the results of operations resulting from changes in foreign exchange rates on investments from fluctuations arising from changes in market prices of securities held. These fluctuations are included with the net realized and unrealized gain or loss from investments and foreign currencies. |
(d) | Forward Foreign Currency Contracts |
The Fund may enter into forward foreign currency contracts in connection with planned purchases or sales of securities or to hedge the U.S. dollar value of portfolio securities denominated in a particular currency. The Fund could be exposed to risks if the counterparties to the contracts are unable to meet the terms of their contracts and from unanticipated movements in the value of a foreign currency relative to the U.S. dollar. Forward foreign currency contracts are valued at the current cost of covering these contracts, as provided by an independent pricing service |
approved by the Board of Trustees. The forward foreign currency contracts are adjusted by the daily exchange rate of the underlying currency and any gains or losses are recorded for financial statement purposes as unrealized gains or losses until the contract settlement date. |
(e) | Futures Contracts |
The Fund may invest in financial futures contracts (“futures contracts”) for the purpose of hedging its existing portfolio securities or securities that the Fund intends to purchase against fluctuations in value caused by changes in prevailing market interest rates or prices. Futures contracts may also be entered into for non-hedging purposes. | |
Upon entering into a futures contract, the Fund is required to pledge to the broker an amount of cash and/or other assets equal to a certain percentage of the contract amount (initial margin deposit). Subsequent payments, known as “variation margin,” are made each day, depending on the daily fluctuations in the fair value/market value of the underlying assets. A gain or loss equal to the daily variation margin is recognized on a daily basis. Futures contracts are valued daily at their last quoted sale price. | |
A “sale” of a futures contract means the creation of a contractual obligation to deliver the securities or foreign currency called for by the contract at a fixed price at a specified time in the future. A “purchase” of a futures contract means the creation of a contractual obligation to acquire the securities or foreign currency at a fixed price at a specified time in the future. | |
Should market conditions change unexpectedly, the Fund may not achieve the anticipated benefits of the futures contracts and may realize a loss. The use of futures transactions for hedging purposes involves the risk of imperfect correlation in movements in the price of futures contracts, interest rates, and the value of the underlying hedged assets. |
(f) | Written Options Contracts |
The Fund may write options contracts. A written option obligates the Fund to deliver (written call) or to receive (written put) a specified quantity of an underlying asset at the contract amount upon exercise by the holder of the option. When the Fund writes an option, an amount equal to the premium received by the Fund is recorded as a liability and is subsequently adjusted to the current fair value of the option written. Premiums received from writing options that expire unexercised are treated by the Fund on the expiration date as realized gains from investments. The difference between the premium and the amount paid on effecting a closing purchase transaction, as a realized loss. If a call option is exercised, the premium is added to the proceeds from the sale of the underlying security or currency in determining whether the Fund has realized a gain or loss. If a put option is exercised, the premium reduces the cost basis of the securities purchased by the Fund. Options traded on an exchange are valued at the last quoted sale price, or in the absence of a sale, the bid price provided by an independent pricing service approved by the Board of Trustees. Non-exchange traded options are valued using dealer supplied quotes. The Fund as a writer of an option bears the market risk of an unfavorable change in the price of the security underlying the written option. |
(g) | Short Sales |
The Fund is authorized to engage in short-selling of portfolio securities which obligates the Fund to replace any security that the Fund has borrowed by purchasing the security at current market value sometime in the future. The Fund will incur a loss if the price of the security increases between the date of the short sale and the date on which the Fund replaces the borrowed security. The Fund generally will realize a gain if the price of the security declines between these dates. Until the Fund replaces the borrowed security, the Fund will maintain a segregated account with cash, U.S. Government securities and/or securities held long to sufficiently cover the Fund’s short position on a daily basis. Dividends declared on securities sold short are recorded as an expense on the ex-dividend date and paid to the counterparty on the dividend pay date. |
(h) | Security Transactions and Investment Income |
Security transactions are accounted for on the date the security is purchased or sold (“trade date”). Securities gains and losses are calculated on the identified cost basis. Interest income is recognized on the accrual basis and includes, where applicable, the amortization or accretion of premium or discount. Dividend income is recorded on the ex-dividend date. |
(i) | Securities Lending |
To generate additional income, the Fund may lend its portfolio securities, up to 33 1/3% of the Fund, to brokers, dealers and other financial institutions provided that (1) the borrower delivers cash or securities as collateral with respect to each new loan of U.S. securities, equal to at least 102% of the value of the portfolio securities loaned, and with respect to each new loan on non-U.S. securities, collateral of at least 105% of the value of the portfolio securities loaned; and (2) at all times thereafter shall require the borrower to mark-to-market the collateral on a daily basis so that the market value of such collateral does not fall below 100% of the value of securities loaned. The Fund receives payments from borrowers equivalent to the dividends and interest that would have been earned on securities loaned while simultaneously seeking to earn income on the investment of cash collateral. There may be risks of delay in recovery of the securities should the borrower of the securities fail financially. Loans will be made, however, only to borrowers deemed by the Fund’s investment adviser to be of good standing and creditworthy under guidelines established by the Board of Trustees and when, in judgment of the adviser, the consideration which can be earned currently from these securities loans justifies the attendant risks. Loans are subject to termination by the Fund or the borrower at any time, and, therefore, are not considered to be illiquid investments. JPMorgan Chase Bank serves as custodian for the securities lending program of the Fund. JPMorgan Chase Bank receives a fee based on the value of the collateral received from borrowers. The Fund did not have securities on loan as of June 30, 2007. |
(j) | Distributions to Shareholders |
The Fund’s dividends from net investment income, if any, are declared and paid quarterly. The Fund’s distributions from net realized capital gains, if any, are declared and distributed at least annually. | |
Dividends and distributions to shareholders are determined in accordance with federal income tax regulations, which may differ from GAAP. These “book/tax” differences are considered either permanent or temporary in nature. In accordance with the American Institute of Certified Public Accountants Statement of Position 93-2, permanent differences (i.e., reclassification of market discounts, foreign exchange gain/loss, paydowns, and distributions from real estate investment trusts) are reclassified within the capital accounts based on their nature for federal income tax purposes; temporary differences do not require reclassification. These reclassifications have no effect upon the net asset value of the Fund. To the extent distributions exceed current and accumulated earnings and profits for federal income tax purposes, these distributions are reported as distributions of paid-in-capital. |
(k) | Federal Income Taxes |
It is the policy of the Fund to qualify or to continue to qualify as a “regulated investment company” by complying with the provisions available to certain investment companies, as defined in Subchapter M of the U.S. Internal Revenue Code, and to make distributions of net investment income and net realized capital gains sufficient to relieve the Fund from all, or substantially all, federal income taxes. |
As of June 30, 2007, the tax cost of securities and the breakdown of unrealized appreciation (depreciation) for the Fund was as follows: |
Net | ||||||||||||||||
Unrealized | ||||||||||||||||
Tax Cost of | Unrealized | Unrealized | Appreciation | |||||||||||||
Securities | Appreciation | Depreciation | (Depreciation) | |||||||||||||
$ | 30,999,673 | $ | 2,014,202 | $ | (739,685 | ) | $ | 1,274,517 | ||||||||
(l) | Allocation of Expenses, Income, and Gains and Losses |
Expenses directly attributable to the Fund are charged to the Fund. Expenses not directly attributable to the Fund are allocated proportionately among various or all funds within the Trust. The method used by the Fund for allocating income, fund level expenses, and realized and unrealized gains or losses is based on the fair value of shares outstanding relative to net assets. Under this method, each class of shares participates based on the total net asset value of that class’s shares in proportion to the total net assets of the Fund. Expenses specific to a class (such as Rule 12b-1 and administrative services fees) are charged to that class. |
3. Transactions with Affiliates
Under the terms of the Trust’s Investment Advisory Agreement, Nationwide Fund Advisors (formerly, Gartmore Global Asset Management Trust (“GGAMT”)) (“NFA” or the “Advisor”) manages the investment of the assets and supervises the daily business affairs of the Fund. NFA is a wholly-owned subsidiary of Nationwide Financial Services (“NFS”).
Under the terms of the Investment Advisory Agreement, the Fund pays NFA an investment advisory fee based on the Fund’s average daily net assets and the following schedule:
Total | ||||||
Base Management Fee | Fees | |||||
Up to $500 million | 0.90% | |||||
$500 million up to $2 billion | 0.85% | |||||
$2 billion and more | 0.80% | |||||
The Fund’s base management fee (as adjusted for any applicable breakpoints) may increase or decrease proportionately depending on how the Fund performs relative to its benchmark, the MSCI World Financials Index. This performance fee is intended to reward or penalize the investment adviser for outperforming or underperforming the Fund’s benchmark.
The calculation of the total management fee is done in two separate steps. First, the Fund calculates a base fee (to be paid at the end of each quarter). The base fee rate results in an annual fee, calculated and accrued daily. The fee rate is applied to the Fund’s average net assets over that quarter. Second, a performance adjustment percentage is applied to the Fund’s average net assets over the 12-month rolling performance period. The performance adjustment amount is then added to (or subtracted from, as applicable) the base fee to arrive at the Fund’s total advisory fee for the most recently completed quarterly sub-period and that total fee is paid at the end of that most recently completed quarter.
The performance fee calculation applies to all of the Fund’s share classes equally, based on the performance of the Class III shares during the performance period. The table below shows the performance adjustment rate applicable to the Fund’s base fee.
Out or Underperformance | Change in Fees | |||||
+/- 1 percentage point | +/- 0.02% | |||||
+/- 2 percentage point | +/- 0.04% | |||||
+/- 3 percentage point | +/- 0.06% | |||||
+/- 4 percentage point | +/- 0.08% | |||||
+/- 5 percentage point | +/- 0.10% | |||||
The performance adjusted advisory fee will be paid quarterly.
Under this performance fee arrangement, the investment adviser can receive a performance fee increase even if the Fund experiences negative performance that still exceeds its benchmark by more than the relevant percentage amount shown above.
Under the terms of a Fund Administration and Transfer Agency Agreement, Nationwide Fund Management, LLC (formerly, Gartmore Investor Services, Inc. (“GISI”)) (“NFM”), a wholly-owned subsidiary of NFS Distributors, Inc. (“NFSDI”), provides the Fund with various administrative and accounting services for the Fund (prior to May 1, 2007, this service was provided by Gartmore SA Capital Trust (“GSA”)), and serves as Transfer and Dividend Disbursing Agent for the Fund (prior to May 1, 2007, this service was provided by GISI, an indirect subsidiary of GSA). The fees for the services provided under this Agreement are calculated based on the Trust’s average daily net assets according to the fee schedule below. The fees are then allocated proportionately among all funds within the Trust in relation to the average daily net assets of each fund and are paid to NFA. NFA pays NFM from these fees for NFM’s services.
Combined Fee Schedule* | ||||||
Up to $1 billion | 0.15% | |||||
$1 billion up to $3 billion | 0.10% | |||||
$3 billion up to $8 billion | 0.05% | |||||
$8 billion up to $10 billion | 0.04% | |||||
$10 billion up to $12 billion | 0.02% | |||||
$12 billion or more | 0.01% | |||||
* | The assets of the Nationwide NVIT Investor Destinations Aggressive Fund, the Nationwide NVIT Investor Destinations Moderately Aggressive Fund, the Nationwide NVIT Investor Destinations Moderate Fund, the Nationwide NVIT Investor Destinations Moderately Conservative Fund, and the Nationwide NVIT Investor Destinations Conservative Fund (collectively, the “Investor Destinations Funds”) are excluded from the Trust asset level amount in order to calculate this asset-based fee. The Investor Destinations Funds do not pay any part of this fee. |
NFA and NFM have entered into agreements with Citi Fund Services Ohio, Inc. (“Citi”), pursuant to which Citi provides sub-administration and sub-transfer agency services, respectively, to the Fund. Effective August 1, 2007, The BISYS Group Inc. was acquired by and became a wholly owned subsidiary of Citi.
Under the terms of a Distribution Plan under Rule 12b-1 of the 1940 Act, Nationwide Fund Distributors, LLC. (formerly, “Gartmore Distribution Services, Inc. (“GDSI”)) (“NFD” or “Distributor”), the Fund’s principal underwriter, is compensated by the Fund for expenses associated with the distribution of the Class II shares of the Fund. NFD is a wholly-owned subsidiary of NFSDI. These fees are based on average daily net assets of Class II shares of the Fund at an annual rate not to exceed 0.25%.
Under the terms of an Administrative Services Plan, the Fund may pay fees to servicing organizations, such as broker-dealers, including NFS, and financial institutions, which agree to provide administrative support services to the
For the six months ended June 30, 2007, NFS received $20,880 in Administrative Services Fees from the Fund.
Under the terms of a letter agreement dated September 12, 2006, by and among NFA, the Audit Committee of the Trust and the Trust, the Trust has agreed to reimburse NFA certain costs related to the Fund’s portion of ongoing administration, monitoring and annual (audit) testing of the Trust’s Rule 38a-1 Compliance Program subject to the pre-approval of the Trust’s Audit Committee. For the six months ended June 30, 2007, the Fund’s portion of such cost amounted to $249.
For the six months ended June 30, 2007, the advisers or affiliates of the advisers directly held 19.97% of the shares outstanding of the Fund.
4. Short-Term Trading Fees
The Fund reserves the right to assess a short-term trading fee on certain transactions out of Class III shares that a separate account makes on behalf of a variable insurance contract owner (the “contract owner”). A separate account that redeems Class III shares on behalf of a contract owner may be subject to a 1.00% short-term trading fee if the separate account held the Class III shares on behalf of the contract owner for 60 days or less, unless an exception applies as disclosed in the Fund’s prospectus. The short-term trading fee is paid directly to the Fund and is intended to offset the cost to the Fund of excess brokerage commissions and other costs associated with fluctuations in Fund asset levels and cash flow caused by short-term trading. For purposes of determining whether the short-term trading fee applies, the Class III shares that were held on behalf of the contract owner the longest will be treated as being redeemed first.
For the six months ended June 30, 2007, the Fund had contributions to capital due to collection of redemption fees in the amount of $12,076.
5. Investment Transactions
For the six months ended June 30, 2007, (excluding short-term securities) the Fund had purchases of $23,929,694 and sales of $27,049,757.
6. Bank Loans and Earnings Credit
The Trust has a credit agreement with JPMorgan Chase & Co., the Fund’s custodian bank, permitting the Trust to borrow up to $100,000,000. Borrowings under this arrangement bear interest at the Federal Funds rate plus 0.50%. The interest costs, if any, would be included in other fees in the Statement of Operations. No compensating balances were required under the terms of the line of credit. The line of credit is renewed annually, expiring on June 25, 2008, with a commitment fee of 0.07% per year on $100,000,000. There were no borrowings outstanding under this line of credit for the six months ended June 30, 2007.
The Trust’s custodian bank has agreed to reduce the bank’s fees (earnings credit) when the funds of the Trust maintain cash on deposit in non-interest-bearing custody and Demand Deposit Accounts. Earnings credits, if any, are shown as a reduction of total expenses on the Statement of Operations.
7. Portfolio Investment Risks
Risks Associated with Foreign Securities and Currencies. Investments in securities of foreign issuers carry certain risks not ordinarily associated with investments in securities of U.S. issuers. These risks include future political and economic developments, and the possible imposition of exchange controls or other foreign governmental laws and restrictions. In addition, with respect to certain countries, there is the possibility of expropriation of assets, confiscatory taxation, political or social instability, or diplomatic developments, which could adversely affect investments in those countries.
Certain countries also may impose substantial restrictions on investments in their capital markets by foreign entities, including restrictions on investments in issuers of industries deemed sensitive to relevant national interests. These factors may limit the investment opportunities available and result in a lack of liquidity and high price volatility with respect to securities of issuers from developing countries.
8. Indemnifications
Under the Trust’s organizational documents, certain of the Trust’s Officers and Trustees are indemnified against certain liabilities arising out of the performance of their duties to the Trust. In addition, the Trust has entered into Indemnification Agreements with the Trust’s trustees and certain officers covering similar liabilities. Trust Officers receive no compensation from the Trust for serving as the Trust’s Officers. In addition, in the normal course of business, the Trust enters into contracts with its vendors and others that provide for general indemnifications. The Trust’s maximum exposure under these arrangements is unknown, as this would involve future claims that may be made against the Trust. Based on experience, however, the Trust expects that risk of loss to be remote.
9. Recently Issued Accounting Pronouncements
On July 13, 2006, the Financial Accounting Standards Board (“FASB”) released FASB Interpretation No. 48, Accounting for Uncertainty in Income Taxes (“FIN 48”). FIN 48 provides guidance for how uncertain tax positions should be recognized, measured, presented and disclosed in the financial statements. FIN 48 requires the affirmative evaluation of tax positions taken or expected to be taken in the course of preparing the Fund’s tax returns to determine whether it is more-likely-than-not (i.e., greater than 50 percent) that each tax position will be sustained upon examination by a taxing authority based on the technical merits of the position. A tax position that meets the more-likely-than-not recognition threshold is measured to determine the amount of benefit to recognize in the financial statements. Differences between tax positions taken in a tax return and amounts recognized in the financial statements will generally result in an increase in a liability for taxes payable (or a reduction of a tax refund receivable) and an increase in a deferred tax liability (or a reduction in a deferred tax asset). Adoption of FIN 48 was required no later than the last business day of the first financial statement reporting period for fiscal years beginning after December 15, 2006 and is to be applied to all open tax years as of the effective date. Accordingly, the Fund was required to implement FIN 48 in its net asset value per share (NAV) calculation on June 29, 2007. Management has evaluated the implications of FIN 48 and has concluded that there was no impact to the Fund’s financial statements as of June 29, 2007. The adoption of FIN 48 requires ongoing monitoring and analysis, future conclusions reached by management may be different and result in adjustments to the Fund’s NAV and financial statements.
In September 2006, the FASB issued Statement on Financial Accounting Standards (“SFAS”) No. 157, “Fair Value Measurements.” This standard establishes a single authoritative definition of fair value, sets out a framework for measuring fair value and requires additional disclosures about fair value measurements. SFAS No. 157 applies to fair value measurements already required or permitted by existing standards. SFAS No. 157 is effective for financial statements issued for fiscal years beginning after November 15, 2007 and interim periods within those fiscal years. The changes to current accounting principles generally accepted in the United States of America from the application of this Statement relate to the definition of fair value, the methods used to measure fair value, and the expanded disclosures about fair value measurements. As of June 30, 2007, the Fund does not believe the adoption of SFAS No. 157 will impact the financial statement amounts; however, additional disclosures may be required about the inputs used to develop the measurements and the effect of certain of the measurements on changes in net assets for the period.
Trustees who are not Interested Persons (as defined in the 1940 Act) and Officers of the Trust as of
Number of Portfolios | ||||||||||
Position(s) Held | in the | |||||||||
with the Trust | Principal Occupation(s) | Nationwide Fund | Other | |||||||
Name, Address | and Length of | During Past | Complex Overseen | Directorships | ||||||
and Year of Birth | Time Served1 | Five Years | by Trustee | Held by Trustee2 | ||||||
Charles E. Allen c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1948 | Trustee since July 2000 | Mr. Allen is Chairman, Chief Executive Officer and President of Graimark Realty Advisors, Inc. (real estate development, investment and asset management). | 89 | None | ||||||
Paula H.J. Cholmondeley c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1947 | Trustee since July 2000 | Ms. Cholmondeley was Vice President and General Manager of Sappi Fine Paper North America from April 2000 through December 2003. | 89 | Director of Dentsply International, Inc. (dental products), Ultralife Batteries, Inc., Terex Corporation (construction equipment), Minerals Technology, Inc. (specialty chemicals) and Albany International Corp. (paper industry) | ||||||
C. Brent DeVore3 c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1940 | Trustee since 1990 | Dr. DeVore is President of Otterbein College. | 89 | None | ||||||
Phyllis Kay Dryden c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1947 | Trustee since December 2004 | Ms. Dryden was a partner of Mitchell Madison, a management consulting company from January 2006 until December 2006; she is currently a consultant with the company. Ms. Dryden was formerly Managing Partner of marchFIRST, a global management consulting firm. | 89 | None | ||||||
Barbara L. Hennigar c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1935 | Trustee since July 2000 | Retired. | 89 | None | ||||||
Number of Portfolios | ||||||||||
Position(s) Held | in the | |||||||||
with the Trust | Principal Occupation(s) | Nationwide Fund | Other | |||||||
Name, Address | and Length of | During Past | Complex Overseen | Directorships | ||||||
and Year of Birth | Time Served1 | Five Years | by Trustee | Held by Trustee2 | ||||||
Barbara I. Jacobs c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1950 | Trustee since December 2004 | Ms. Jacobs served as Chairman of the Board of Directors of KICAP Network Fund, a European (United Kingdom) hedge fund, from January 2001 through January 2006. From 1998-2003, Ms. Jacobs was also a Managing Director and European Portfolio Manager of CREF Investments (Teachers Insurance and Annuity Association-College Retirement Equities Fund). | 89 | None | ||||||
Douglas F. Kridler c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1955 | Trustee since September 1997 | Mr. Kridler has served as the President and Chief Executive Officer of the Columbus Foundation (a Columbus, OH-based foundation which manages over 1,300 individual endowment funds) since February 2002. Prior to January 31, 2002, Mr. Kridler was the President of the Columbus Association for the Performing Arts and Chairman of the Greater Columbus Convention and Visitors Bureau. | 89 | None | ||||||
Michael D. McCarthy c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1947 | Trustee since December 2004 | Retired. Mr. McCarthy was Chairman of VMAC (commodity swaps) from October 2002 until January 2007; and a partner of Pineville Properties LLC (a commercial real estate development firm) from September 2000 until January 2007. | 89 | None | ||||||
David C. Wetmore c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1948 | Trustee since 1995 and Chairman since February 2005 | Retired. | 89 | None | ||||||
1 | Length of time served includes time served with the Trust’s predecessors. | |
2 | Directorships held in (1) any other investment companies registered under the 1940 Act, (2) any company with a class of securities registered pursuant to Section 12 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or (3) any company subject to the requirements of Section 15(d) of the Exchange Act. | |
3 | Mr. DeVore has served as President of Otterbein College since 1984. Mark Thresher, President and Chief Operating Officer of Nationwide Financial Services, Inc. (“NFS”) has served as a member of the Board of Trustees of Otterbein College since 2000, currently serves as one of 30 of its trustees, and is currently one of two Vice Chairmen of the Board. Each of Nationwide Fund Advisors (“NFA”), the Funds’ investment adviser, and Nationwide Fund Distributors LLC (“NFD”), principal underwriter to the Trust, is a wholly-owned subsidiary of NFS. | |
Additional information regarding the Trustees and Officers may be found in the Trust’s Statement of Additional Information, which is available without charge upon request, by calling 800-848-0920. |
Trustees who are Interested Persons (as defined in the 1940 Act) and/or Officers of the Trust as of
Number of Portfolios | ||||||||||
Position(s) Held | in the | |||||||||
with the Trust | Principal Occupation(s) | Nationwide Fund | Other | |||||||
Name, Address | and Length of | During Past | Complex Overseen | Directorships | ||||||
and Year of Birth | Time Served1 | 5 Years | by Trustee | Held by Trustee 2 | ||||||
Arden L. Shisler c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1941 | Trustee since February 2000 | Retired. Mr. Shisler is the former President and Chief Executive Officer of KeB Transport, Inc., a trucking firm (2000 through 2002). He served as a consultant to KeB from January 2003 through December 2004. Since 1992, Mr. Shisler has also been Chairman of the Board for Nationwide Mutual Insurance Company.3 | 89 | Director of Nationwide Financial Services, Inc., Chairman of Nationwide Mutual Insurance Company3 | ||||||
John H. Grady Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1961 | President & Chief Executive Officer since December 2006 | Mr. Grady is President, and Chief Executive Officer of Nationwide Funds Group which includes Nationwide Fund Advisors,3 Nationwide Fund Management LLC,3 Nationwide Fund Distributors LLC 3 and NWD Investments,2 the asset management operations of Nationwide Mutual Insurance Company, which includes Morley Capital Management, Inc.,2 Nationwide Separate Accounts LLC,2 NorthPointe Capital LLC,2 and Nationwide SA Capital Trust2. From March 2004 until March 2006, Mr. Grady was Chief Executive Officer of Constellation Investment Management Co., L.P. (registered investment adviser), and President and Chief Executive Officer of Constellation Funds Group (registered investment companies). He also was President of Constellation Investment Distribution Co., Inc. (registered broker-dealer) from March 2004 until June 2006. From February 2001 until February 2004, Mr. Grady was Chief Operating and Chief Legal Officer; Managing Director, Mutual Funds Group, Turner Investment Partners, Inc. (registered investment adviser); Executive Vice President of Turner Funds and Turner Institutional Portfolios (registered investment companies); and President, Turner Investment Distributors, Inc. (registered broker-dealer). | N/A | None | ||||||
Gerald J. Holland Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1951 | Treasurer since March 2001 | Mr. Holland is Senior Vice President—Operations for Nationwide Funds Group3. | N/A | N/A | ||||||
Number of Portfolios | ||||||||||
Position(s) Held | in the | |||||||||
with the Trust | Principal Occupation(s) | Nationwide Fund | Other | |||||||
Name, Address | and Length of | During Past | Complex Overseen | Directorships | ||||||
and Year of Birth | Time Served1 | 5 Years | by Trustee | Held by Trustee 2 | ||||||
Michael A. Krulikowski Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1959 | Chief Compliance Officer from June 2004 to August 20074 | Mr. Krulikowski is Vice President and Chief Compliance Officer of Nationwide Funds Group3, Morley Capital Management, Inc.3, Nationwide SA Capital Trust (since 1999)3, and Nationwide Separate Accounts LLC (since August 2005).3 Since June 2004, Mr. Krulikowski has also served as Chief Compliance Officer of the Trust. From November 1999 through May 2007, he served as Vice President and Chief Compliance Officer of NorthPointe Capital LLC. 3 | N/A | N/A | ||||||
Eric E. Miller Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1953 | Secretary since December 2002 | Mr. Miller is Senior Vice President, General Counsel, and Assistant Secretary for Nationwide Funds Group3 and NWD Investments.2 From August 2000 to August 2002, Mr. Miller was a Partner with Stradley Ronon Stevens & Young, LLP. | N/A | N/A | ||||||
1 | Length of time served includes time served with the Trust’s predecessors. | |
2 | Directorships held in (1) any other investment companies registered under the 1940 Act, (2) any company with a class of securities registered pursuant to Section 12 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or (3) any company subject to the requirements of Section 15(d) of the Exchange Act. | |
3 | This position is held with an affiliated person or principal underwriter of the Trust. | |
4 | Effective August 3, 2007, the Board of Trustees approved Carol Baldwin Moody as Chief Compliance Officer of the Trust. Since November 2005, Ms. Moody has been Senior Vice President, Chief Compliance Officer of Nationwide Financial Services, Nationwide Life Insurance Company, Nationwide Life and Annuity Insurance Company, and Nationwide Investment Advisors, LLC. From February 2004-November 2005, she was Chief Compliance Officer of TIAA-CREF and from April 2000-February 2004, she was Managing Director and General Counsel, TCW/ Latin America Partners, LLC and Baeza & Co., LLC. | |
Federal law requires the Trust, each of its investment advisers and sub-advisers to adopt procedures for voting proxies (“Proxy Voting Guidelines”) and to provide a summary of those Proxy Voting Guidelines used to vote the securities held by the Funds. The Funds’ proxy voting policies and procedures are available without charge (i) upon request, by calling 800-848-0920, (ii) on the Funds’ website at www.nationwidefunds.com, or (iii) on the Securities and Exchange Commission’s website at www.sec.gov. |
A. Renewal of Investment Advisory Agreement
(i) | General Information Regarding the Board’s Review of Investment Advisory Agreements |
The Trust���s investment advisory agreements (each an “Advisory Agreement”) with its investment adviser and, as applicable, sub-advisers (together, the “Adviser”) must be approved for an initial term no greater than two years, and renewed at least annually thereafter, (i) by the vote of the Trustees or by a vote of the shareholders of each series or fund of the Trust (individually a “Fund”), and (ii) by the vote of a majority of the Trustees who are not parties to the Advisory Agreement or “interested persons” of any party thereto (the “Independent Trustees”) cast in person at a meeting called for the purpose of voting on such approval.
The Board meets quarterly and takes into account throughout the year matters bearing on each Fund’s Advisory Agreement. The Board and its standing committees consider at each meeting factors that are relevant to the annual renewal of an Advisory Agreement, including the services and support provided to a Fund and its shareholders.
On December 6, 2006, the Independent Trustees first met in person with their independent legal counsel (“Independent Legal Counsel”) to consider information provided by the Adviser and others to assist the Trustees in considering whether to renew each Fund’s Advisory Agreement for a one year term beginning May 1, 2007. Immediately following such meeting of the Independent Trustees, all Trustees met in person with the Adviser, Trust counsel, Independent Legal Counsel and others to consider such matters, and give preliminary consideration to information bearing on continuation of each Advisory Agreement. The primary purpose of the December 6 and 7, 2006 meeting was to ensure that the Trustees had ample opportunity to consider matters they deemed relevant in considering the continuation of an Advisory Agreement, and to request any additional information they considered reasonably necessary to their deliberations.
In preparation for the December 6 and 7, 2006 meeting the Trustees were provided, at the request of the Trustees, with a wide range of information to assist in their deliberations, including (i) reports from Lipper Inc. describing a Fund’s (a) performance rankings (where “first quintile” denotes the best performance) (over multiple years ended September 30, 2006) compared with performance groups and performance universes created by Lipper (and in some cases, customized peer groups created by the Adviser) of similar or peer group funds, and (b) expense rankings (where “first quintile” denotes the lowest fees and expenses) comparing the Fund’s contractual advisory fee and total expenses with expense groups and expense universes created by Lipper of similar or peer group funds, (ii) information from the Adviser describing the Fund’s performance (over multiple years ended September 30, 2006) compared with its benchmark and Lipper categories, (iii) for Funds under “close review,” copies of letters from the Adviser to the portfolio manager of each such Fund, together with the portfolio manager’s written response describing the reasons for the Fund’s underperformance (iv) information from the Adviser describing performance for the months of October and November, 2006, and annual performance for the year ended November 30, 2006, (v) reports from the Adviser describing the Adviser’s profitability in providing services under an Advisory Agreement, together with an explanation of Adviser’s methodology in calculating its profitability, (vi) information from the Adviser describing any fees paid to the Adviser for managing similar, non-affiliated institutional accounts, including the range of fee levels for such accounts, and (vii) information from the Adviser describing ancillary benefits, in addition to fees for serving as investment adviser, derived by the Adviser as a result of being investment adviser for a Fund, including, where applicable, information on soft-dollar benefits and fees inuring to the Adviser’s affiliates for serving as the Trust’s administrator, fund accountant and transfer agent.
At the December 6 and 7, 2006 meeting, the Trustees reviewed, considered and discussed, among themselves and with the Adviser, Trust counsel and Independent Legal Counsel, among other things, the information described above, and: (i) the nature, extent and quality of services provided by the Adviser under each Advisory Agreement, (ii) the investment performance of each Fund and the Adviser, (iii) the costs of the services provided by the Adviser under the Advisory Agreement and the profits realized by the Adviser thereunder, (iv) the extent to which economies of scale may be present and, if so, whether they are being shared with a Fund’s shareholders, (v) comparisons of the Adviser’s fees under the Advisory Agreement with investment advisory fees paid by peer group funds to their investment advisers and paid by non-affiliated institutional clients to the Adviser for managing similar accounts, and (vi) any ancillary benefits inuring to the Adviser and its affiliates as a result of being investment adviser for the Trust. The Trustees also considered, where
As part of the December 6 and 7, 2006 Board meeting, the Independent Trustees developed a list of follow-up matters and questions and asked that Adviser respond to such matters and questions at the contract approval meeting of the Board of Trustees to be held on January 11, 2007.
At the January 11, 2007 meeting of the Board of Trustees of the Trust, the Board received and considered information provided by the Adviser in follow-up from the December 6 and 7, 2006 Board meeting and, after consulting among themselves, and with the Adviser, Trust counsel and Independent Legal Counsel, concluded unanimously to renew the Advisory Agreement for the reasons set forth in the following section. In determining whether to renew the Advisory Agreement for the Fund, the Board ultimately reached a determination, with the assistance of Trust counsel and Independent Legal Counsel, that the renewal of the Advisory Agreement and the compensation to be received by the Adviser under the Advisory Agreement is consistent with the Board’s fiduciary duty under applicable law.
(ii) | Board Conclusions Regarding the Fund’s Advisory Agreement |
The Board considered that the Fund had underperformed its benchmark, the MSCI World/Financials Index, for the one-and three-year periods. The Board also considered that performance of the Fund’s Class III shares had ranked in the first quintile of the Fund’s Lipper-constructed Performance Group over the one-, two-, three-, and four-year periods. Based on its review, and giving particular weight to the nature and quality of the resources dedicated by the adviser to maintain relative performance, the Board concluded the nature, extent, and quality of the services provided to the Fund will benefit the Fund’s shareholders.
The Board also considered that the Fund’s contractual advisory fee and breakpoints, and the Fund’s total fees placed the Fund in the fifth quintile of its Lipper-constructed Expense Group. Although the Fund’s contractual advisory fee compared with peer group funds was relatively high, the Board also considered that the Fund had implemented a performance fee structure, which is intended to either reward or penalize the adviser for outperforming or underperforming, respectively, the Fund’s benchmark. The Board concluded that the Fund’s management fee and total expenses were fair and reasonable in light of the services that the Fund receives and the other factors considered.
The Board considered that the Fund’s adviser reported a pre-tax profit margin for investment management services during each of the twelve month-periods ended September 30, 2006 and 2005. The Board considered the costs of the services provided by and the profits realized by the Fund’s adviser in connection with the operation of the Fund and determined that the amount of profit is a fair entrepreneurial profit for the management of the Fund.
Based upon its evaluation of all of the conclusions noted above, and after considering all material factors with respect to the Fund, the Board ultimately concluded that the advisory fee structure is fair and reasonable, and that the Advisory Agreement (and, if applicable, Sub-Advisory Agreement) with respect to Fund, should be renewed.
B. Approval of New Advisory Agreement
At its January 11, 2007 meeting, the Board also unanimously approved a new investment advisory agreement (the “New Agreement”) for the Fund with Nationwide Fund Advisors, (“NFA”) the then-current adviser to each of the series of the Trust to become effective upon the closing of the acquisition of NFA by Nationwide Financial Services, Inc. (“NFS”) from Nationwide Corporation (“NWC”) which closed on April 30, 2007 (the “Transaction”). In approving the New Agreement, the Board considered NFA’s capacity to continue to provide the services needed to operate a sophisticated investment management business and to support the management of each of the series. The Board also took into account the information provided to them at their regular quarterly meetings with NFA’s senior management with respect to the Fund, including the information provided by management at the Fund’s annual Section 15(c) meetings on December 6-7, 2006 and January 11, 2007. In addition, the Board also considered NFS’ announced intentions, over
C. Submission of Matters to a Vote of Security Holders:
On April 25, 2007, a Special Meeting of Shareholders was held* (the “April 25 Meeting”) at which shareholders of the Funds** set forth below were asked:
Proposal 1:
To approve a new investment advisory agreement, on behalf of their Fund, between Nationwide Fund Advisors (formerly “Gartmore Mutual Fund Capital Trust”) (the “Adviser”) and Nationwide Variable Insurance Trust (formerly “Gartmore Variable Insurance Trust”) (the “Trust”).
Number of Shares | ||||||
Fund | Cast/Not Cast | Percentages | ||||
Federated NVIT High Income Bond Fund (Formerly Federated GVIT High Income Bond Fund) | FOR AGAINST ABSTAIN TOTAL | 30,051,703.188 shares 618,245.021 shares 1,813,550.431 shares 32,483,498.640 shares | 92.514% 1.903% 5.583% | |||
NVIT International Index Fund (Formerly GVIT International Index Fund) | FOR AGAINST ABSTAIN TOTAL | 4,322,203.982 shares 2,758.318 shares 135,636.840 shares 4,460,599.140 shares | 96.897% 0.062% 3.041% | |||
NVIT International Value Fund (Formerly GVIT International Value Fund) | FOR AGAINST ABSTAIN TOTAL | 20,032,843.199 shares 333,588.902 shares 1,093,293.879 shares 21,459,725.980 shares | 93.351% 1.554% 5.095% | |||
NVIT Mid Cap Index Fund (Formerly GVIT Mid Cap Index Fund) | FOR AGAINST ABSTAIN TOTAL | 35,380,179.120 shares 631,117.844 shares 1,565,714.306 shares 37,577,011.270 shares | 94.154% 1.679% 4.167% | |||
NVIT S&P 500 Index Fund (Formerly GVIT S&P 500 Index Fund) | FOR AGAINST ABSTAIN TOTAL | 56,119,814.230 shares 666,195.542 shares 1,944,898.888 shares 58,730,908.660 shares | 95.554% 1.134% 3.312% |
Number of Shares | ||||||
Fund | Cast/Not Cast | Percentages | ||||
Nationwide Multi-Manager NVIT Small Cap Growth Fund (Formerly GVIT Small Cap Growth Fund) | FOR AGAINST ABSTAIN TOTAL | 7,632,918.513 shares 149,458.111 shares 451,583.036 shares 8,233,959.660 shares | 92.700% 1.816% 5.484% | |||
Nationwide Multi-Manager NVIT Small Cap Value Fund (Formerly GVIT Small Cap Value Fund) | FOR AGAINST ABSTAIN TOTAL | 48,649,396.525 shares 979,183.753 shares 2,786,133.102 shares 52,414,713.380 shares | 92.816% 1.868% 5.316% | |||
Nationwide Multi-Manager NVIT Small Company Fund (Formerly GVIT Small Company Fund) | FOR AGAINST ABSTAIN TOTAL | 29,903,181.700 shares 838,774.923 shares 2,006,741.307 shares 32,748,697.930 shares | 91.311% 2.561% 6.128% | |||
Gartmore NVIT Developing Markets Fund (Formerly Gartmore GVIT Developing Markets Fund) | FOR AGAINST ABSTAIN TOTAL | 21,0177,889.443 shares 424,272.958 shares 1,543,850.729 shares 23,046,013.130 shares | 91.460% 1.841% 6.699% | |||
Gartmore NVIT Emerging Markets Fund (Formerly Gartmore GVIT Emerging Markets Fund) | FOR AGAINST ABSTAIN TOTAL | 17,050,534.593 shares 526,574.722 shares 881,608.905 shares 18,458,718.220 shares | 92.371% 2.853% 4.776% | |||
Nationwide NVIT Global Financial Services Fund (Formerly Gartmore GVIT Global Financial Services Fund) | FOR AGAINST ABSTAIN TOTAL | 1,554,847.333 shares 19,539.033 shares 52,206.494 shares 1,626,592.860 shares | 95.589% 1.201% 3.210% | |||
Nationwide NVIT Global Health Sciences Fund (Formerly Gartmore GVIT Global Health Sciences Fund) | FOR AGAINST ABSTAIN TOTAL | 4,722,963.678 shares 157,979.030 shares 207,642.222 shares 5,088,584.930 shares | 92.815% 3.104% 4.081% | |||
Nationwide NVIT Global Technology and Communications Fund (Formerly Gartmore GVIT Global Technology and Communications Fund) | FOR AGAINST ABSTAIN TOTAL | 8,585,472.039 shares 102,267.977 shares 489,577.634 shares 9,177,317.650 shares | 93.551% 1.114% 5.335% | |||
Gartmore NVIT Global Utilities Fund (Formerly Gartmore GVIT Global Utilities Fund) | FOR AGAINST ABSTAIN TOTAL | 4,123,270.549 shares 122,001.533 shares 240,276.088 shares 4,485,548.170 shares | 91.923% 2.720% 5.357% | |||
Nationwide NVIT Government Bond Fund (Formerly Gartmore GVIT Government Bond Fund) | FOR AGAINST ABSTAIN TOTAL | 88,471,567.462 shares 1,825,645.181 shares 5,841,990.727 shares 96,139,203.370 shares | 92.024% 1.899% 6.077% | |||
Nationwide NVIT Growth Fund (Formerly Gartmore GVIT Growth Fund) | FOR AGAINST ABSTAIN TOTAL | 14,931,435.904 shares 409,826.402 shares 1,259,945.064 shares 16,601,207.370 shares | 89.942% 2.469% 7.589% |
Number of Shares | ||||||
Fund | Cast/Not Cast | Percentages | ||||
Gartmore NVIT International Growth Fund (Formerly Gartmore GVIT International Growth Fund) | FOR AGAINST ABSTAIN TOTAL | 6,251,419.070 shares 139,618.548 shares 290,025.592 shares 6,681,063.210 shares | 93.569% 2.090% 4.341% | |||
Nationwide NVIT Investor Destinations Aggressive Fund (Formerly Gartmore GVIT Investor Destinations Aggressive Fund) | FOR AGAINST ABSTAIN TOTAL | 49,489,224.549 shares 1,385,396.474 shares 3,696,272.337 shares 54,570,893.360 shares | 90.688% 2.539% 6.773% | |||
Nationwide NVIT Investor Destinations Conservative Fund (Formerly Gartmore GVIT Investor Destinations Conservative Fund) | FOR AGAINST ABSTAIN TOTAL | 23,091,965.887 shares 314,935,884 shares 2,292,355.179 shares 25,699,256.950 shares | 89.855% 1.225% 8.920% | |||
Nationwide NVIT Investor Destinations Moderate Fund (Formerly Gartmore GVIT Investor Destinations Moderate Fund) | FOR AGAINST ABSTAIN TOTAL | 188,902,093.059 shares 3,018,924.590 shares 16,359,690.401 shares 208,280,708.050 shares | 90.696% 1.449% 7.855% | |||
Nationwide NVIT Investor Destinations Moderately Aggressive Fund (Formerly Gartmore GVIT Investor Destinations Moderately Aggressive Fund) | FOR AGAINST ABSTAIN TOTAL | 134,792,622.920 shares 3,489,207.264 shares 9,304,197.656 shares 147,586,027.840 shares | 91.332% 2.364% 6.304% | |||
Nationwide NVIT Investor Destinations Moderately Conservative Fund (Formerly Gartmore GVIT Investor Destinations Moderately Conservative Fund) | FOR AGAINST ABSTAIN TOTAL | 49,627,123.216 shares 856,088.634 shares 3,507,215.650 shares 53,990,427.500 shares | 91.918% 1.586% 6.496% | |||
Nationwide NVIT Mid Cap Growth Fund (Formerly Gartmore GVIT Mid Cap Growth Fund) | FOR AGAINST ABSTAIN TOTAL | 10,879,584.971 shares 352,594.958 shares 717,792.971 shares 11,949,972.900 shares | 91.043% 2.950% 6.007% | |||
Nationwide NVIT Money Market Fund II (Formerly Gartmore GVIT Money Market Fund II) | FOR AGAINST ABSTAIN TOTAL | 221,774,863.241 shares 12,322,482.494 shares 16,471,740.875 shares 250,569,086.610 shares | 88.508% 4.918% 6.574% | |||
Nationwide NVIT Money Market Fund (Formerly Gartmore GVIT Money Market Fund) | FOR AGAINST ABSTAIN TOTAL | 1,578,331,008.328 shares 32,372,133.671 shares 112,652,123.301 shares 1,723,355,265.300 shares | 91.585% 1.878% 6.537% | |||
NVIT Nationwide Fund (Formerly Gartmore GVIT Nationwide Fund) | FOR AGAINST ABSTAIN TOTAL | 125,423,274.735 shares 2,767,979.467 shares 8,762,255.828 shares 136,953,510.030 shares | 91.581% 2.021% 6.398% | |||
NVIT Nationwide Leaders Fund (Formerly Gartmore GVIT Nationwide Leaders Fund) | FOR AGAINST ABSTAIN TOTAL | 2,298,504.956 shares 29,630.469 shares 71,637.755 shares 2,399,773.180 shares | 95.780% 1.235% 2.985% |
Number of Shares | ||||||
Fund | Cast/Not Cast | Percentages | ||||
Nationwide NVIT U.S. Growth Leaders Fund (Formerly Gartmore GVIT U.S. Growth Leaders Fund) | FOR AGAINST ABSTAIN TOTAL | 4,972,094.773 shares 122,623.161 shares 174,625.606 shares 5,269,343.540 shares | 94.359% 2.327% 3.314% | |||
Gartmore NVIT Worldwide Leaders Fund (Formerly Gartmore GVIT Worldwide Leaders Fund) | FOR AGAINST ABSTAIN TOTAL | 2,666,862.487 shares 47,702.491 shares 118,719.882 shares 2,833,284.860 shares | 94.126% 1.684% 4.190% | |||
JP Morgan NVIT Balanced Fund (Formerly JP Morgan GVIT Balanced Fund) | FOR AGAINST ABSTAIN TOTAL | 15,966,867.546 shares 259,004.324 shares 1,339,385.200 shares 17,565,257.070 shares | 90.900% 1.475% 7.625% | |||
Van Kampen NVIT Comstock Value Fund (Formerly Van Kampen GVIT Comstock Value Fund) | FOR AGAINST ABSTAIN TOTAL | 27,737,008.009 shares 502,564.164 shares 1,824,670.107 shares 30,064,242.280 shares | 92.259% 1.672% 6.069% | |||
Van Kampen NVIT Multi Sector Bond Fund (Formerly Van Kampen GVIT Multi Sector Bond Fund) | FOR AGAINST ABSTAIN TOTAL | 21,253,297.665 shares 484,100.920 shares 1,803,963.645 shares 23,541,362.230 shares | 90.281% 2.056% 7.663% | |||
At the April 25 Meeting, shareholders of the Nationwide NVIT Mid Cap Growth Fund were also asked to approve a new investment subadvisory agreement among the Adviser, the Trust and NorthPointe Capital LLC. The voting results with respect to that proposal are set forth below:
Proposal 2:
Number of Shares | ||||||
Fund | Cast/Not Cast | Percentages | ||||
Nationwide NVIT Mid Cap Growth Fund (Formerly Gartmore GVIT Mid Cap Growth Fund) | FOR AGAINST ABSTAIN TOTAL | 10,862,827.499 shares 414,574.660 shares 672,570.741 shares 11,949,972.900 shares | 90.903% 3.469% 5.628% | |||
* | This meeting was previously adjourned on April 23, 2007. | |
** | Fund names were changed effective May 1, 2007 to reflect “Nationwide”/“NVIT” branding to coincide with the sale of Nationwide Fund Advisors, Inc. by Nationwide Corporation to its majority-owned subsidiary, Nationwide Financial Services, Inc. |
June 30, 2007 (Unaudited)
Contents | ||
6 | Statement of Investments | |
8 | Statement of Assets and Liabilities | |
9 | Statement of Operations | |
10 | Statements of Changes in Net Assets | |
12 | Financial Highlights | |
13 | Notes to Financial Statements |
Statement Regarding Availability of Proxy Voting Record.
SAR-USGL (8/07) | ![]() |
Dear Fellow Shareholder:
Since I last wrote to you, our mutual funds have enjoyed another period of solid performance, and the corporate realignment that was in progress is now finished.
On May 1, 2007, Nationwide Financial Services, Inc. (NFS), completed its acquisition of the Philadelphia-based retail mutual fund operations of NWD Investment Management, Inc. (formerly, “Gartmore Global Investments, Inc.”), from Nationwide Corporation, a subsidiary of Nationwide Mutual Insurance Company. Effective that date, the acquired entities were renamed Nationwide Funds Group (NFG), and the Gartmore Funds were renamed the Nationwide Funds to better align with the Nationwide® brand. Although the corporate ownership and fund names have changed, I can assure you that NFG intends to maintain as much continuity as possible with the Funds and key personnel.
Thank you, shareholders, for approving the new investment advisory agreement that was required due to the change in corporate ownership. The new agreement is identical in all material respects to the original agreement that it replaces, with the exception of the section pertaining to the vote by the shareholders of the NVIT Mid Cap Growth Fund to approve NorthPointe Capital®, LLC (NorthPointe) as sub-adviser to that particular Fund.
Market Overview: January 1-June 30, 2007
Share prices in general were buoyed in part by better-than-expected first-quarter 2007 earnings and a flurry of mergers and acquisitions, many of these spurred by readily available funding from private equity firms. In June, investors grew more cautious amid surging crude oil prices, a sudden spike in long-term interest rates, and the meltdown of two hedge funds that had exposure to the subprime mortgage market. Looking abroad, a weak U.S. dollar aided foreign stocks, as reflected in the 11.09% advance of the Morgan Stanley Capital International Europe, Australasia and Far East (MSCI EAFE®) Index. Emerging market performance was particularly robust.
The bond market struggled during the first half of 2007. While short-term interest rates remained stable, reflecting the Federal Reserve Board’s decision in June to leave the target federal funds rate at 5.25%, longer-term rates climbed during the first half of 2007, depressing bond prices and forcing the Lehman Brothers® U.S. Aggregate Index to settle for a modest 0.97% return.
We at NFG thank you for your understanding and cooperation throughout our recent transition period. We emerge from this period energized for the future, and we look forward to serving your investment needs for a long time to come.
Nationwide Funds Group
PAST PERFORMANCE IS NO GUARANTEE OF FUTURE RESULTS.
Nationwide Funds are advised by Nationwide Fund Advisors (NFA). NFA is a wholly-owned subsidiary of Nationwide Financial Services. Nationwide Financial Services is a wholly-owned subsidiary of Nationwide Corporation. All of the common stock of Nationwide Corporation is held by Nationwide Mutual (95.2%) and Nationwide Mutual Fire Insurance Company (4.8%), each of which is a mutual company owned by its policyholders.
Nationwide Funds Group (NFG) is the mutual fund arm of Nationwide Financial Services (NYSE: NFS). Based in Conshohocken, Pa., a suburb of Philadelphia, NFG is comprised of Nationwide Fund Advisors, Nationwide Fund Distributors, LLC, and Nationwide Fund Management, LLC. Together, these provide advisory, distribution, and administration services respectively to the Nationwide Funds, and manage more than $43.5 billion in assets as of June 30, 2007, of which more than $12 billion are in “fund of funds” designed to provide asset allocation across several types of investments and asset classes.
Lehman Brothers (LB) U.S. Aggregate Index: An unmanaged, market value-weighted index of investment-grade, fixed-rate debt issues (including government, corporate, asset-backed, and mortgage-backed securities with maturities of one year or more) that is generally representative of the bond market as a whole.
Morgan Stanley Capital International Europe, Australasia and Far East (MSCI EAFE®) Index: An unmanaged, free float-adjusted, market capitalization-weighted index that is designed to measure the performance of stocks in developed markets outside the United States and Canada.
Standard & Poor’s 500® (S&P 500) Index: An unmanaged, market capitalization-weighted index of 500 widely held stocks of large-cap U.S. companies that gives a broad look at how the stock prices of those companies have performed.
Views expressed within are those of Nationwide Funds Group as of the date noted, are subject to change at any time, and may not come to pass.
This report is for informational purposes only, and is not intended as an offer or recommendation with respect to the purchase or sale of any security, option, future, or other derivatives in such securities.
Investing in mutual funds involves risk, including possible loss of principal.
Investors should carefully consider a fund’s investment objectives, risks, fees, charges, and expenses before investing any money. To obtain this and other fund information, please call 800-848-0920 to request a prospectus, or download a prospectus at www.nationwidefunds.com. Please read the prospectus carefully before investing any money.
Nationwide Funds distributed by Nationwide Fund Distributors LLC (formerly Gartmore Distribution Services, Inc.), Member NASD. 1200 River Road, Suite 1000, Conshohocken, Pa. 19428.
As a shareholder of the Fund, you incur two types of costs: (1) transaction costs, including sales charges (loads) paid on purchase payments and redemption fees; and (2) ongoing costs, including investment advisory fees, administration fees, distribution fees and other Fund expenses. The examples below are 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. Per SEC requirements, the examples assume that you had a $1,000 investment in the Class at the beginning of the reporting period, January 1, 2007, and continued to hold your shares at the end of the reporting period, June 30, 2007.
Actual Expenses
Hypothetical Example for Comparison Purposes
Please note that the expenses shown in the table are meant to highlight your ongoing costs only and do not reflect any transaction costs, such as sales charges (loads) or redemption fees. Therefore, the second line for each Class in 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 transaction costs were included, your costs would have been higher. The examples also assume all dividends and distributions have been reinvested.
Schedule of Shareholder Expenses
Nationwide NVIT U.S. Growth Leaders Fund | ||||||||||||||||||||||
Beginning | Ending | Expenses Paid | Annualized | |||||||||||||||||||
Account Value, | Account | During Period* | Expense Ratio* | |||||||||||||||||||
January 1, 2007 | Value, | |||||||||||||||||||||
June 30, 2007 | ||||||||||||||||||||||
Class I | Actual | $ | 1,000.00 | $ | 1,129.00 | $ | 6.23 | 1.18% | ||||||||||||||
Hypothetical | 1 | $ | 1,000.00 | $ | 1,018.95 | $ | 5.92 | 1.18% | ||||||||||||||
Class II | Actual | $ | 1,000.00 | $ | 1,127.70 | $ | 7.54 | 1.43% | ||||||||||||||
Hypothetical | 1 | $ | 1,000.00 | $ | 1,017.71 | $ | 7.18 | 1.43% | ||||||||||||||
Class III | Actual | $ | 1,000.00 | $ | 1,128.20 | $ | 6.28 | 1.19% | ||||||||||||||
Hypothetical | 1 | $ | 1,000.00 | $ | 1,018.90 | $ | 5.97 | 1.19% | ||||||||||||||
* | Expenses are equal to the Fund’s annualized expense ratio multiplied by the average account value over the period multiplied by 181/365 (to reflect the one-half year period). The expense ratio presented represents a six-month, annualized ratio in accordance with SEC guidelines. The expenses reported above do not include the effect of additional expenses imposed by variable annuity contracts. | |
1 | Represents the hypothetical 5% return before expenses. |
Nationwide NVIT U.S. Growth Leaders Fund
Asset Allocation | ||||
Common Stock | 96.6% | |||
Repurchase Agreements | 5.5% | |||
Other Investments* | 6.8% | |||
Liabilities in excess of other assets** | -8.9% | |||
100.0% |
Top Industries | ||||
Communications Equipment | 13.2% | |||
Semiconductors & Semiconductor Equipment | 8.9% | |||
Aerospace & Defense | 7.0% | |||
Capital Markets | 6.7% | |||
Pharmaceuticals | 6.1% | |||
Internet Software & Services | 5.2% | |||
Hotels, Restaurants & Leisure | 4.9% | |||
Software | 4.8% | |||
Oil, Gas & Consumable Fuels | 4.0% | |||
Biotechnology | 3.8% | |||
Other | 35.4% | |||
100.0% |
Top Holdings*** | ||||
Cisco Systems, Inc. | 6.5% | |||
XTO Energy, Inc. | 4.0% | |||
Rockwell Collins, Inc. | 3.9% | |||
Gilead Sciences, Inc. | 3.8% | |||
Google, Inc., Class A | 3.7% | |||
Northern Trust Corp. | 3.5% | |||
Wyeth | 3.5% | |||
Comcast Corp., Class A | 3.5% | |||
Cooper Industries Ltd., Class A ADR—BM | 3.5% | |||
Monsanto Co. | 3.4% | |||
Other | 60.7% | |||
100.0% |
* | Includes value of collateral received from securities lending. |
** | Includes value of collateral owed from securities lending. |
*** | For purpose of listing top holdings, repurchase agreements are included as part of Other. |
Nationwide NVIT U.S. Growth Leaders Fund
Common Stock (96.6%) | ||||||||
Shares or | ||||||||
Principal Amount | Value | |||||||
Aerospace & Defense (7.0%) | ||||||||
Precision Castparts Corp. | 15,340 | $ | 1,861,663 | |||||
Rockwell Collins, Inc. | 33,530 | 2,368,559 | ||||||
4,230,222 | ||||||||
Air Freight & Logistics (2.2%) | ||||||||
C.H. Robinson Worldwide, Inc. | 25,830 | 1,356,592 | ||||||
1,356,592 | ||||||||
Biotechnology (3.8%) | ||||||||
Gilead Sciences, Inc.* | 59,660 | 2,313,018 | ||||||
2,313,018 | ||||||||
Capital Markets (6.7%) | ||||||||
Lehman Brothers Holding, Inc. | 25,770 | 1,920,380 | ||||||
Northern Trust Corp. | 33,440 | 2,148,186 | ||||||
4,068,566 | ||||||||
Chemicals (3.4%) | ||||||||
Monsanto Co. | 30,760 | 2,077,530 | ||||||
2,077,530 | ||||||||
Commercial Banks (1.0%) | ||||||||
PNC Bank Corp. | 8,640 | 618,451 | ||||||
618,451 | ||||||||
Communications Equipment (13.2%) | ||||||||
Cisco Systems, Inc.* | 141,500 | 3,940,775 | ||||||
Corning, Inc.* | 46,840 | 1,196,762 | ||||||
Foundry Networks, Inc.* | 80,860 | 1,347,128 | ||||||
QUALCOMM, Inc. | 35,490 | 1,539,911 | ||||||
8,024,576 | ||||||||
Diversified Financial Services (2.2%) (a) | ||||||||
IntercontinentalExchange, Inc.* | 8,890 | 1,314,387 | ||||||
1,314,387 | ||||||||
Diversified Telecommunication Services (2.0%) | ||||||||
American Tower Corp.* | 28,590 | 1,200,780 | ||||||
1,200,780 | ||||||||
Electrical Equipment (3.5%) | ||||||||
Cooper Industries Ltd., Class A ADR — BM | 37,220 | 2,124,890 | ||||||
2,124,890 | ||||||||
Energy Equipment & Services (2.5%) | ||||||||
Transocean, Inc. ADR — KY* | 14,550 | 1,542,009 | ||||||
1,542,009 | ||||||||
Food & Staples Retailing (3.2%) | ||||||||
CVS/ Caremark Corp. | 53,780 | 1,960,281 | ||||||
1,960,281 | ||||||||
Health Care Equipment & Supplies (2.0%) | ||||||||
Baxter International, Inc. | 21,660 | 1,220,324 | ||||||
1,220,324 | ||||||||
Hotels, Restaurants & Leisure (4.9%) | ||||||||
MGM Grand, Inc.* | 14,360 | 1,184,413 | ||||||
Starwood Hotels & Resorts Worldwide, Inc. | 26,450 | 1,774,001 | ||||||
2,958,414 | ||||||||
Internet Software & Services (5.2%) | ||||||||
Akamai Technologies, Inc.* | 19,160 | 931,942 | ||||||
Google, Inc., Class A* | 4,280 | 2,240,067 | ||||||
3,172,009 | ||||||||
Life Sciences Tools & Services (2.0%) | ||||||||
Thermo Fisher Scientific, Inc.* | 23,220 | 1,200,938 | ||||||
1,200,938 | ||||||||
Media (3.5%) | ||||||||
Comcast Corp., Class A* | 75,875 | 2,133,605 | ||||||
2,133,605 | ||||||||
Metals & Mining (2.2%) | ||||||||
Allegheny Technologies, Inc. | 12,620 | 1,323,586 | ||||||
1,323,586 | ||||||||
Multiline Retail (2.3%) | ||||||||
Kohl’s Corp.* | 19,200 | 1,363,776 | ||||||
1,363,776 | ||||||||
Oil, Gas & Consumable Fuels (4.0%) | ||||||||
XTO Energy, Inc. | 40,380 | 2,426,838 | ||||||
2,426,838 | ||||||||
Pharmaceuticals (6.1%) | ||||||||
Shire PLC ADR — GB | 20,810 | 1,542,645 | ||||||
Wyeth | 37,460 | 2,147,957 | ||||||
3,690,602 | ||||||||
Semiconductors & Semiconductor Equipment (8.9%) | ||||||||
MEMC Electronic Materials, Inc.* | 27,430 | 1,676,522 | ||||||
Microchip Technology, Inc. | 50,770 | 1,880,521 | ||||||
NVIDIA Corp.* | 45,150 | 1,865,146 | ||||||
5,422,189 | ||||||||
Common Stock (continued) | ||||||||
Shares or | ||||||||
Principal Amount | Value | |||||||
Software (4.8%) | ||||||||
Adobe Systems, Inc.* | 42,310 | $ | 1,698,746 | |||||
Macrovision Corp.*(a) | 40,000 | 1,202,401 | ||||||
2,901,147 | ||||||||
Total Common Stocks (Cost $54,720,665) | 58,644,730 | |||||||
Repurchase Agreements (5.5%) | ||||||||
Nomura Securities, 5.20%, dated 06/29/07, due 07/02/07, repurchase price $3,328,858, collateralized by U.S. Government Agency Mortgages with a market value of $3,393,965 | $ | 3,327,415 | 3,327,415 | |||||
Securities Held as Collateral for Securities on Loan (6.8%) | ||||||||
Morgan Stanley Repurchase Agreement, 5.42%, dated 06/29/07, due 07/02/07, repurchase price $4,137,826, collateralized by U.S. Government Agency Mortgages with a market value of $4,218,677 | 4,135,958 | 4,135,958 | ||||||
Total Investments (Cost $62,184,040) (b) — 108.9% | 66,108,103 | |||||||
Liabilities in excess of other assets — (8.9)% | (5,427,677 | ) | ||||||
NET ASSETS — 100.0% | $ | 60,680,426 | ||||||
* | Denotes a non-income producing security. | |
(a) | All or a part of the security was on loan as of June 30, 2007. | |
(b) | See notes to financial statements for tax unrealized appreciation (depreciation) of securities. |
ADR | American Depository Receipt | |
BM | Bermuda | |
GB | United Kingdom | |
KY | Cayman Islands |
See accompanying notes to financial statements.
Nationwide NVIT | ||||||
U.S. Growth | ||||||
Leaders Fund | ||||||
Assets: | ||||||
Investments, at value (cost $54,720,665)* | $ | 58,644,730 | ||||
Repurchase agreements, at cost and value | 7,463,373 | |||||
Total Investments | 66,108,103 | |||||
Interest and dividends receivable | 38,324 | |||||
Receivable for capital shares issued | 5,047 | |||||
Receivable for investments sold | 1,741,573 | |||||
Prepaid expenses | 15 | |||||
Total Assets | 67,893,062 | |||||
Liabilities: | ||||||
Payable for investments purchased | 2,878,348 | |||||
Payable upon return of securities loaned | 4,135,958 | |||||
Payable for capital shares redeemed | 13,835 | |||||
Accrued expenses and other payables: | ||||||
Investment advisory fees | 155,317 | |||||
Fund administration and transfer agent fees | 3,153 | |||||
Distribution fees | 4,295 | |||||
Administrative servicing fees | 4,862 | |||||
Compliance program costs | 823 | |||||
Other | 16,045 | |||||
Total Liabilities | 7,212,636 | |||||
Net Assets | $ | 60,680,426 | ||||
Represented by: | ||||||
Capital | $ | 51,052,303 | ||||
Accumulated net investment loss | (164,531 | ) | ||||
Accumulated net realized gains from investment transactions | 5,868,591 | |||||
Net unrealized appreciation on investments | 3,924,063 | |||||
Net Assets | $ | 60,680,426 | ||||
Net Assets: | ||||||
Class I Shares | $ | 12,226,896 | ||||
Class II Shares | 21,090,988 | |||||
Class III Shares | 27,362,542 | |||||
Total | $ | 60,680,426 | ||||
Shares outstanding (unlimited number of shares authorized): | ||||||
Class I Shares | 1,027,164 | |||||
Class II Shares | 1,783,237 | |||||
Class III Shares | 2,285,222 | |||||
Total | 5,095,623 | |||||
Net asset value and offering price per share (Net assets by class divided by shares outstanding by class, respectively.): | ||||||
Class I Shares | $ | 11.90 | ||||
Class II Shares | $ | 11.83 | ||||
Class III Shares | $ | 11.97 | ||||
* | Includes value of securities on loan of $4,034,588. |
8
Nationwide NVIT | |||||
U.S. Growth | |||||
Leaders Fund | |||||
INVESTMENT INCOME: | |||||
Interest income | $ | 31,748 | |||
Dividend income | 174,321 | ||||
Income from securities lending | 3,279 | ||||
Total Income | 209,348 | ||||
Expenses: | |||||
Investment advisory fees | 264,643 | ||||
Fund administration and transfer agent fees | 18,766 | ||||
Distribution fees Class II Shares | 25,274 | ||||
Administrative servicing fees Class I Shares | 7,996 | ||||
Administrative servicing fees Class II Shares | 14,215 | ||||
Administrative servicing fees Class III Shares | 19,071 | ||||
Custodian fees | 5,787 | ||||
Trustee fees | 1,386 | ||||
Compliance program costs (Note 3) | 422 | ||||
Other | 16,398 | ||||
Total expenses before earnings credit | 373,958 | ||||
Earnings credit (Note 6) | (79 | ) | |||
Net Expenses | 373,879 | ||||
Net Investment Loss | (164,531 | ) | |||
REALIZED/ UNREALIZED GAINS (LOSSES) FROM INVESTMENTS: | |||||
Net realized gains on investment transactions | 6,340,907 | ||||
Net change in unrealized appreciation on investments | 989,375 | ||||
Net realized/unrealized gains (losses) on investments | 7,330,282 | ||||
CHANGE IN NET ASSETS RESULTING FROM OPERATIONS | $ | 7,165,751 | |||
9
Nationwide NVIT | |||||||||
U.S. Growth Leaders Fund | |||||||||
Six Months Ended | Year Ended | ||||||||
June 30, 2007 | December 31, 2006 | ||||||||
(Unaudited) | |||||||||
FROM INVESTMENT ACTIVITIES: | |||||||||
Operations: | |||||||||
Net investment income (loss) | $ | (164,531 | ) | $ | 121,302 | ||||
Net realized gains on investment transactions | 6,340,907 | 107,878 | |||||||
Net change in unrealized appreciation/depreciation on investments | 989,375 | (1,126,069 | ) | ||||||
Change in net assets resulting from operations | 7,165,751 | (896,889 | ) | ||||||
Distributions to shareholders from: | |||||||||
Net investment income: | |||||||||
Class I | – | (26,243 | ) | ||||||
Class II | – | (26,750 | ) | ||||||
Class III | – | (68,309 | ) | ||||||
Net realized gains: | |||||||||
Class I | – | (205,376 | ) | ||||||
Class II | – | (373,444 | ) | ||||||
Class III | – | (590,833 | ) | ||||||
Tax return of capital: | |||||||||
Class I | – | (5,876 | ) | ||||||
Class II | – | (5,989 | ) | ||||||
Class III | – | (15,294 | ) | ||||||
Change in net assets from shareholder distributions | – | (1,318,114 | ) | ||||||
Change in net assets from capital transactions | (6,985,531 | ) | (4,690,434 | ) | |||||
Change in net assets | 180,220 | (6,905,437 | ) | ||||||
Net Assets: | |||||||||
Beginning of period | 60,500,206 | 67,405,643 | |||||||
End of period | $ | 60,680,426 | $ | 60,500,206 | |||||
Accumulated net investment income (loss) at end of period | $ | (164,531 | ) | $ | – | ||||
10
Nationwide NVIT | |||||||||
U.S. Growth Leaders Fund | |||||||||
Six Months Ended | Year Ended | ||||||||
June 30, 2007 | December 31, 2006 | ||||||||
(Unaudited) | |||||||||
CAPITAL TRANSACTIONS: | |||||||||
Class I Shares | |||||||||
Proceeds from shares issued | $ | 1,287,314 | $ | 4,801,363 | |||||
Dividends reinvested | – | 237,494 | |||||||
Cost of shares redeemed (a) | (2,044,408 | ) | (3,923,615 | ) | |||||
(757,094 | ) | 1,115,242 | |||||||
Class II Shares | |||||||||
Proceeds from shares issued | 1,245,510 | 5,806,714 | |||||||
Dividends reinvested | – | 406,181 | |||||||
Cost of shares redeemed (a) | (2,370,814 | ) | (4,812,555 | ) | |||||
(1,125,304 | ) | 1,400,340 | |||||||
Class III Shares | |||||||||
Proceeds from shares issued | 3,076,252 | 8,365,161 | |||||||
Dividends reinvested | – | 674,433 | |||||||
Cost of shares redeemed (a) | (8,179,385 | ) | (16,245,610 | ) | |||||
(5,103,133 | ) | (7,206,016 | ) | ||||||
Change in net assets from capital transactions | $ | (6,985,531 | ) | $ | (4,690,434 | ) | |||
SHARE TRANSACTIONS: | |||||||||
Class I Shares | |||||||||
Issued | 115,441 | 447,301 | |||||||
Reinvested | – | 23,415 | |||||||
Redeemed | (181,796 | ) | (375,985 | ) | |||||
(66,355 | ) | 94,731 | |||||||
Class II Shares | |||||||||
Issued | 110,735 | 538,982 | |||||||
Reinvested | – | 40,354 | |||||||
Redeemed | (212,975 | ) | (466,666 | ) | |||||
(102,240 | ) | 112,670 | |||||||
Class III Shares | |||||||||
Issued | 265,774 | 764,926 | |||||||
Reinvested | – | 66,190 | |||||||
Redeemed | (733,121 | ) | (1,537,239 | ) | |||||
(467,347 | ) | (706,123 | ) | ||||||
Total change in shares | (635,942 | ) | (498,722 | ) | |||||
(a) | Includes redemption fees, if any. |
11
Investment Activities | Distributions | |||||||||||||||||||||||||||
Net Realized | ||||||||||||||||||||||||||||
and | ||||||||||||||||||||||||||||
Net Asset | Net | Unrealized | Total | |||||||||||||||||||||||||
Value, | Investment | Gains | from | Net | Net | |||||||||||||||||||||||
Beginning | Income | (Losses) on | Investment | Investment | Realized | Return | ||||||||||||||||||||||
of Period | (Loss) | Investments | Activities | Income | Gains | of Capital | ||||||||||||||||||||||
Class I Shares | ||||||||||||||||||||||||||||
Period Ended December 31, 2002 (e) | $ | 8.64 | (0.02) | (1.07 | ) | (1.09 | ) | – | – | – | ||||||||||||||||||
For the Year Ended December 31, 2003 | $ | 7.56 | (0.02) | 3.95 | 3.93 | – | (0.76 | ) | – | |||||||||||||||||||
For the Year Ended December 31, 2004 | $ | 10.74 | (0.08) | 1.36 | 1.28 | – | (0.46 | ) | – | |||||||||||||||||||
For the Year Ended December 31, 2005 | $ | 11.56 | (0.02) | 1.32 | 1.30 | – | (2.06 | ) | – | |||||||||||||||||||
For the Year Ended December 31, 2006 | $ | 10.80 | 0.02 | (0.08 | ) | (0.06 | ) | (0.02 | ) | (0.18 | ) | (0.01 | ) | |||||||||||||||
For the Six Months Ended June 30, 2007 (Unaudited) | $ | 10.53 | (0.03) | 1.40 | 1.37 | – | – | – | ||||||||||||||||||||
Class II Shares | ||||||||||||||||||||||||||||
Period Ended December 31, 2003 (g) | $ | 8.17 | (0.02) | 3.36 | 3.34 | – | (0.76 | ) | – | |||||||||||||||||||
For the Year Ended December 31, 2004 | $ | 10.76 | (0.08) | 1.33 | 1.25 | – | (0.46 | ) | – | |||||||||||||||||||
For the Year Ended December 31, 2005 | $ | 11.55 | (0.04) | 1.31 | 1.27 | – | (2.06 | ) | – | |||||||||||||||||||
For the Year Ended December 31, 2006 | $ | 10.76 | – | (j) | (0.07 | ) | (0.07 | ) | (0.01 | ) | (0.18 | ) | (0.01 | ) | ||||||||||||||
For the Six Months Ended June 30, 2007 (Unaudited) | $ | 10.49 | (0.04) | 1.38 | 1.34 | – | – | – | ||||||||||||||||||||
Class III Shares | ||||||||||||||||||||||||||||
For the Year Ended December 31, 2002 | $ | 9.92 | (0.05) | (2.30 | ) | (2.35 | ) | – | – | – | ||||||||||||||||||
For the Year Ended December 31, 2003 | $ | 7.58 | (0.03) | 3.99 | 3.96 | – | (0.76 | ) | – | |||||||||||||||||||
For the Year Ended December 31, 2004 | $ | 10.79 | (0.11) | 1.40 | 1.29 | – | (0.46 | ) | – | |||||||||||||||||||
For the Year Ended December 31, 2005 | $ | 11.62 | (0.03) | 1.33 | 1.30 | – | (2.06 | ) | – | |||||||||||||||||||
For the Year Ended December 31, 2006 | $ | 10.86 | 0.04 | (0.08 | ) | (0.04 | ) | (0.02 | ) | (0.18 | ) | (0.01 | ) | |||||||||||||||
For the Six Months Ended June 30, 2007 (Unaudited) | $ | 10.61 | (0.03) | 1.39 | 1.36 | – | – | – | ||||||||||||||||||||
[Additional columns below]
[Continued from above table, first column(s) repeated]
Distributions | Ratios/Supplemental Data | |||||||||||||||||||||||
Paid-in | Ratio of | |||||||||||||||||||||||
Capital | Net Assets | Expenses | ||||||||||||||||||||||
from | Net Asset | at End of | to Average | |||||||||||||||||||||
Total | Redemption | Value, End | Total | Period | Net Assets | |||||||||||||||||||
Distributions | Fees | of Period | Return (a) | (000s) | (b) | |||||||||||||||||||
Class I Shares | ||||||||||||||||||||||||
Period Ended December 31, 2002 (e) | – | 0.01 | $ | 7.56 | (12.50% | ) | $ | 476 | 1.16% | |||||||||||||||
For the Year Ended December 31, 2003 | (0.76 | ) | 0.01 | $ | 10.74 | 52.14% | $ | 6,199 | 1.19% | |||||||||||||||
For the Year Ended December 31, 2004 | (0.46 | ) | – | $ | 11.56 | 12.41% | $ | 6,369 | 1.29% | |||||||||||||||
For the Year Ended December 31, 2005 | (2.06 | ) | – | $ | 10.80 | 11.96% | $ | 10,783 | 1.17% | |||||||||||||||
For the Year Ended December 31, 2006 | (0.21 | ) | – | $ | 10.53 | (0.29% | )(h) | $ | 11,510 | 1.21% | (i) | |||||||||||||
For the Six Months Ended June 30, 2007 (Unaudited) | – | – | $ | 11.90 | 12.90% | $ | 12,227 | 1.18% | ||||||||||||||||
Class II Shares | ||||||||||||||||||||||||
Period Ended December 31, 2003 (g) | (0.76 | ) | 0.01 | $ | 10.76 | 41.02% | $ | 4,101 | 1.43% | |||||||||||||||
For the Year Ended December 31, 2004 | (0.46 | ) | – | $ | 11.55 | 12.10% | $ | 10,593 | 1.53% | |||||||||||||||
For the Year Ended December 31, 2005 | (2.06 | ) | – | $ | 10.76 | 11.70% | $ | 19,067 | 1.41% | |||||||||||||||
For the Year Ended December 31, 2006 | (0.20 | ) | – | $ | 10.49 | (0.50% | )(h) | $ | 19,777 | 1.46% | (i) | |||||||||||||
For the Six Months Ended June 30, 2007 (Unaudited) | – | – | $ | 11.83 | 12.77% | $ | 21,091 | 1.43% | ||||||||||||||||
Class III Shares | ||||||||||||||||||||||||
For the Year Ended December 31, 2002 | – | 0.01 | $ | 7.58 | (23.59% | ) | $ | 6,501 | 1.10% | |||||||||||||||
For the Year Ended December 31, 2003 | (0.76 | ) | 0.01 | $ | 10.79 | 52.39% | $ | 54,959 | 1.19% | |||||||||||||||
For the Year Ended December 31, 2004 | (0.46 | ) | – | $ | 11.62 | 12.45% | $ | 33,158 | 1.29% | |||||||||||||||
For the Year Ended December 31, 2005 | (2.06 | ) | – | $ | 10.86 | 11.99% | $ | 37,556 | 1.17% | |||||||||||||||
For the Year Ended December 31, 2006 | (0.21 | ) | – | $ | 10.61 | (0.29% | )(h) | $ | 29,194 | 1.20% | (i) | |||||||||||||
For the Six Months Ended June 30, 2007 (Unaudited) | – | – | $ | 11.97 | 12.82% | $ | 27,363 | 1.19% | ||||||||||||||||
[Additional columns below]
[Continued from above table, first column(s) repeated]
Ratios/Supplemental Data | ||||||||||||||||||
Ratio of | ||||||||||||||||||
Ratio of | Investment | |||||||||||||||||
Ratio of Net | Expenses | Income (Loss) | ||||||||||||||||
Investment | (Prior to | (Prior to | ||||||||||||||||
Income (Loss) | Reimbursements) | Reimbursements) | ||||||||||||||||
to Average | to Average | to Average | Portfolio | |||||||||||||||
Net Assets (b) | Net Assets (b)(c) | Net Assets (b)(c) | Turnover (d) | |||||||||||||||
Class I Shares | ||||||||||||||||||
Period Ended December 31, 2002 (e) | (0.56% | ) | (f) | (f) | 754.41% | |||||||||||||
For the Year Ended December 31, 2003 | (0.50% | ) | (f) | (f) | 580.71% | |||||||||||||
For the Year Ended December 31, 2004 | (0.77% | ) | (f) | (f) | 520.00% | |||||||||||||
For the Year Ended December 31, 2005 | (0.39% | ) | (f) | (f) | 447.55% | |||||||||||||
For the Year Ended December 31, 2006 | 0.26% | (i) | (f) | (f) | 382.64% | |||||||||||||
For the Six Months Ended June 30, 2007 (Unaudited) | (0.46% | ) | 1.18% | (0.46% | ) | 161.85% | ||||||||||||
Class II Shares | ||||||||||||||||||
Period Ended December 31, 2003 (g) | (0.66% | ) | (f) | (f) | 580.71% | |||||||||||||
For the Year Ended December 31, 2004 | (1.03% | ) | (f) | (f) | 520.00% | |||||||||||||
For the Year Ended December 31, 2005 | (0.63% | ) | (f) | (f) | 447.55% | |||||||||||||
For the Year Ended December 31, 2006 | 0.02% | (i) | (f) | (f) | 382.64% | |||||||||||||
For the Six Months Ended June 30, 2007 (Unaudited) | (0.72% | ) | 1.43% | (0.72% | ) | 161.85% | ||||||||||||
Class III Shares | ||||||||||||||||||
For the Year Ended December 31, 2002 | (0.64% | ) | (f) | (f) | 754.41% | |||||||||||||
For the Year Ended December 31, 2003 | (0.50% | ) | (f) | (f) | 580.71% | |||||||||||||
For the Year Ended December 31, 2004 | (0.77% | ) | (f) | (f) | 520.00% | |||||||||||||
For the Year Ended December 31, 2005 | (0.38% | ) | (f) | (f) | 447.55% | |||||||||||||
For the Year Ended December 31, 2006 | 0.31% | (i) | (f) | (f) | 382.64% | |||||||||||||
For the Six Months Ended June 30, 2007 (Unaudited) | (0.48% | ) | 1.19% | (0.48% | ) | 161.85% | ||||||||||||
(a) | Not annualized for periods less than one year. | |
(b) | Annualized for periods less than one year. | |
(c) | During the period, certain fees were waived and/or reimbursed. If such waivers/reimbursements had not occurred, the ratios would have been as indicated. | |
(d) | Portfolio turnover is calculated on the basis of the Fund as a whole without distinguishing among the classes of shares. | |
(e) | For the period from June 3, 2002 (commencement of operations) through December 31, 2002. | |
(f) | There were no fee reductions during the period. | |
(g) | For the period from March 21, 2003 (commencement of operations) through December 31, 2003. | |
(h) | Includes reimbursement from the Investment Adviser which increased the total return by 0.66% | |
(i) | Excludes reimbursement from the Investment Adviser. | |
(j) | The amount is less than $0.005 per share. |
See accompanying notes to financial statements.
1. Organization
Nationwide Variable Insurance Trust (“NVIT” or the “Trust”) is an open-end management investment company, organized under the laws of Delaware by an amended and restated Agreement and Declaration of Trust, dated October 28, 2004, as amended to date. Prior to May 1, 2007, the Trust was named “Gartmore Variable Insurance Trust”. The Trust, originally created under the laws of Massachusetts as a Massachusetts business trust pursuant to a Declaration of Trust dated, as of June 30, 1981, and as subsequently amended, redomesticated as a Delaware Statutory Trust after the close of trading on April 29, 2005, and is registered under the Investment Company Act of 1940, as amended (the “1940 Act”). The redomestication was a change in statutory status and did not affect the operations of the Trust. As of June 30, 2007, the Trust had authorized an unlimited number of shares of beneficial interest, without par value (“shares”). The Trust currently offers shares to life insurance company separate accounts to fund the benefits under variable life insurance or annuity policies. To date, only the separate accounts of Nationwide Life Insurance Company and Nationwide Life and Annuity Insurance Company (collectively, “Nationwide”) have purchased shares of the Nationwide NVIT U.S. Growth Leaders Fund (the “Fund”), (formerly, “Gartmore GVIT U.S. Growth Leaders Fund”). The Trust currently operates forty (40) separate series, or mutual funds, each with its own investment objectives and strategies. This report contains the financial statements and financial highlights of the Fund.
2. Summary of Significant Accounting Policies
The following is a summary of significant accounting policies followed by the Fund in the preparation of its financial statements. The policies are in conformity with accounting principles generally accepted in the United States of America (“GAAP”). The preparation of financial statements requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of income and expenses for the period. Actual results could differ from those estimates.
(a) | Security Valuation |
Securities for which market quotations are readily available are valued at current market value as of “Valuation Time.” Valuation Time is as of the close of regular trading on the New York Stock Exchange (usually 4 p.m. Eastern time). Equity securities are valued at the last quoted sale price or, if there is no sale price, the last quoted bid price provided by an independent pricing service approved by the Trust’s Board of Trustees (“Board of Trustees”). Securities traded on NASDAQ are valued at the NASDAQ official closing price. Prices are taken from the primary market or exchange in which each security trades. | |
Most securities listed on a foreign exchange are valued either at fair value (see description below) or at the last sale price at the close of the exchange on which the security is principally traded. Foreign securities, currencies, and other assets and liabilities denominated in foreign currencies are translated into U.S. dollars at the exchange rate of said currencies against the U.S. dollar, as of Valuation Time, as provided by an independent pricing service approved by the Board of Trustees. | |
Debt (including defaulted issues) and other fixed income securities (other than short-term obligations) are valued at the last quoted bid price and/or by using a combination of daily quotes and matrix evaluations provided by an independent pricing service, the use of which has been approved by the Board of Trustees. Short-term debt securities, such as commercial paper and U.S. Treasury Bills having a remaining maturity of 60 days or less at the time of purchase, are considered to be “short-term” and are valued at amortized cost, which approximates market value. | |
Securities for which market quotations are not readily available, or for which an independent pricing service does not provide a value or provides a value that does not represent fair value in the judgment of the Fund’s investment adviser or designee, are valued at fair value under procedures approved by the Board of Trustees. The “Fair Value” of these securities is determined in good faith by taking into account relevant factors and surrounding circumstances. Methods utilized to obtain a “Fair Value” may include the following non-exclusive list of acceptable methods: (i) a multiple of earnings; (ii) the discount from market value of a similar, freely traded security; (iii) the yield-to-maturity |
for debt issues; or (iv) a consolidation of the methods. The Trust’s Valuation & Operations Committee considers a non-exclusive list of factors to arrive at the appropriate method of determining “Fair Value.” For example, fair value determinations are required for securities whose value is affected by a “significant” event that materially affects the value of a domestic or foreign security which occurs subsequent to the time of the close of the principal market on which such domestic or foreign security trades and before the Valuation Time (i.e., a “subsequent event”). Typically, this will involve events occurring after the close of a foreign market on which a security trades and before the next Valuation Time. | |
The Fund values foreign securities at fair value in the circumstances described below. Generally, trading in foreign securities markets is completed each day at various times prior to the Valuation Time. Due to the time differences between the closings of the relevant foreign securities exchanges and the Valuation Time for the Fund, the Fund will fair value its foreign investments when it is determined that the market quotations for the foreign investments either are not readily available or are unreliable and, therefore, do not represent fair value. When the fair value prices are utilized, these prices will attempt to reflect the impact of the U.S. financial markets’ perceptions and trading activities on the Fund’s foreign investments since the last closing prices of the foreign investments were calculated on their primary foreign securities markets or exchanges. For these purposes, the Board of Trustees has determined that movements in relevant indices or other appropriate market indicators, after the close of the foreign securities exchanges, may demonstrate that market quotations are unreliable, and may trigger fair value pricing for certain securities. Consequently, fair valuation of portfolio securities may occur on a daily basis. |
(b) | Repurchase Agreements |
The Fund may enter into repurchase agreements with an entity which is a member of the Federal Reserve System or which is a “primary dealer” (as designated by the Federal Reserve Bank of New York) in U.S. Government obligations. The repurchase price generally equals the price paid by the Fund plus interest negotiated on the basis of current short-term rates, which may be more or less than the rate on the underlying portfolio securities. The seller under a repurchase agreement is required to maintain the value of the collateral held pursuant to the agreement at a market value equal to or greater than the repurchase price (including accrued interest). Collateral subject to repurchase agreements is held by the Fund’s custodian or another qualified sub-custodian or in the Federal Reserve/ Treasury book-entry system. If the counterparty defaults and the fair value of the collateral declines, realization of the collateral by the Fund may be delayed or limited. The Fund may transfer uninvested cash balances into a pooled cash account. These balances are invested in one or more repurchase agreements, with the counterparty of Nomura Securities, which is fully collateralized by U.S. Government Agency Mortgages. |
(c) | Foreign Currency Transactions |
The accounting records of the Fund are maintained in U.S. dollars. Foreign currency amounts are translated into U.S. dollars at the current rate of exchange to determine the value of investments, assets and liabilities. The Fund may enter into foreign currency contracts in connection with purchases or sales of securities denominated in a foreign currency. Purchases and sales of securities, and income and expenses, are translated at the prevailing rate of exchange on the respective date of these transactions. The Fund does not isolate that portion of the results of operations resulting from changes in foreign exchange rates on investments from fluctuations arising from changes in market prices of securities held. These fluctuations are included with the net realized and unrealized gain or loss from investments and foreign currencies. |
(d) | Forward Foreign Currency Contracts |
The Fund may enter into forward foreign currency contracts in connection with planned purchases or sales of securities or to hedge the U.S. dollar value of portfolio securities denominated in a particular currency. The Fund could be exposed to risks if the counterparties to the contracts are unable to meet the terms of their contracts and from unanticipated movements in the value of a foreign currency relative to the U.S. dollar. Forward foreign currency contracts are valued at the current cost of covering these contracts, as provided by an independent pricing service |
approved by the Board of Trustees. The forward foreign currency contracts are adjusted by the daily exchange rate of the underlying currency and any gains or losses are recorded for financial statement purposes as unrealized gains or losses until the contract settlement date. |
(e) | Futures Contracts |
The Fund may invest in financial futures contracts (“futures contracts”) for the purpose of hedging its existing portfolio securities or securities that the Fund intends to purchase against fluctuations in value caused by changes in prevailing market interest rates or prices. Futures contracts may also be entered into for non-hedging purposes. | |
Upon entering into a futures contract, the Fund is required to pledge to the broker an amount of cash and/or other assets equal to a certain percentage of the contract amount (initial margin deposit). Subsequent payments, known as “variation margin,” are made each day, depending on the daily fluctuations in the fair value/market value of the underlying assets. A gain or loss equal to the daily variation margin is recognized on a daily basis. Futures contracts are valued daily at their last quoted sale price. | |
A “sale” of a futures contract means the creation of a contractual obligation to deliver the securities or foreign currency called for by the contract at a fixed price at a specified time in the future. A “purchase” of a futures contract means the creation of a contractual obligation to acquire the securities or foreign currency at a fixed price at a specified time in the future. | |
Should market conditions change unexpectedly, the Fund may not achieve the anticipated benefits of the futures contracts and may realize a loss. The use of futures transactions for hedging purposes involves the risk of imperfect correlation in movements in the price of futures contracts, interest rates, and the value of the underlying hedged assets. |
(f) | Written Options Contracts |
The Fund may write options contracts. A written option obligates the Fund to deliver (written call) or to receive (written put) a specified quantity of an underlying asset at the contract amount upon exercise by the holder of the option. When the Fund writes an option, an amount equal to the premium received by the Fund is recorded as a liability and is subsequently adjusted to the current fair value of the option written. Premiums received from writing options that expire unexercised are treated by the Fund on the expiration date as realized gains from investments. The difference between the premium and the amount paid on effecting a closing purchase transaction, as a realized loss. If a call option is exercised, the premium is added to the proceeds from the sale of the underlying security or currency in determining whether the Fund has realized a gain or loss. If a put option is exercised, the premium reduces the cost basis of the securities purchased by the Fund. Options traded on an exchange are valued at the last quoted sale price, or in the absence of a sale, the bid price provided by an independent pricing service approved by the Board of Trustees. Non-exchange traded options are valued using dealer supplied quotes. The Fund as a writer of an option bears the market risk of an unfavorable change in the price of the security underlying the written option. |
(g) | Short Sales |
The Fund is authorized to engage in short-selling of portfolio securities which obligates the Fund to replace any security that the Fund has borrowed by purchasing the security at current market value sometime in the future. The Fund will incur a loss if the price of the security increases between the date of the short sale and the date on which the Fund replaces the borrowed security. The Fund generally will realize a gain if the price of the security declines between these dates. Until the Fund replaces the borrowed security, the Fund will maintain a segregated account with cash, U.S. Government securities and/or securities held long to sufficiently cover the Fund’s short position on a daily basis. Dividends declared on securities sold short are recorded as an expense on the ex-dividend date and paid to the counterparty on the dividend pay date. |
(h) | Security Transactions and Investment Income |
Security transactions are accounted for on the date the security is purchased or sold (“trade date”). Securities gains and losses are calculated on the identified cost basis. Interest income is recognized on the accrual basis and includes, where applicable, the amortization or accretion of premium or discount. Dividend income is recorded on the ex-dividend date. |
(i) | Securities Lending |
To generate additional income, the Fund may lend its portfolio securities, up to 33 1/3% of the Fund, to brokers, dealers and other financial institutions provided that (1) the borrower delivers cash or securities as collateral with respect to each new loan of U.S. securities, equal to at least 102% of the value of the portfolio securities loaned, and with respect to each new loan on non-U.S. securities, collateral of at least 105% of the value of the portfolio securities loaned; and (2) at all times thereafter shall require the borrower to mark-to-market the collateral on a daily basis so that the market value of such collateral does not fall below 100% of the value of securities loaned. The Fund receives payments from borrowers equivalent to the dividends and interest that would have been earned on securities loaned while simultaneously seeking to earn income on the investment of cash collateral. There may be risks of delay in recovery of the securities should the borrower of the securities fail financially. Loans will be made, however, only to borrowers deemed by the Fund’s investment adviser to be of good standing and creditworthy under guidelines established by the Board of Trustees and when, in judgment of the adviser, the consideration which can be earned currently from these securities loans justifies the attendant risks. Loans are subject to termination by the Fund or the borrower at any time, and, therefore, are not considered to be illiquid investments. JPMorgan Chase Bank serves as custodian for the securities lending program of the Fund. JPMorgan Chase Bank receives a fee based on the value of the collateral received from borrowers. | |
Information on the investment of cash collateral is shown in the Statement of Investments. | |
As of June 30, 2007, the Fund had securities with the following value on loan: |
Value of Loaned Securities | Value of Collateral | |||||
$4,034,588 | $ | 4,135,958 | ||||
(j) | Distributions to Shareholders |
The Fund’s dividends from net investment income, if any, are declared and paid quarterly. The Fund’s distributions from net realized capital gains, if any, are declared and distributed at least annually. | |
Dividends and distributions to shareholders are determined in accordance with federal income tax regulations, which may differ from GAAP. These “book/tax” differences are considered either permanent or temporary in nature. In accordance with the American Institute of Certified Public Accountants Statement of Position 93-2, permanent differences (i.e., reclassification of market discounts, foreign exchange gain/loss, paydowns, and distributions from real estate investment trusts) are reclassified within the capital accounts based on their nature for federal income tax purposes; temporary differences do not require reclassification. These reclassifications have no effect upon the net asset value of the Fund. To the extent distributions exceed current and accumulated earnings and profits for federal income tax purposes, these distributions are reported as distributions of paid-in-capital. |
(k) | Federal Income Taxes |
It is the policy of the Fund to qualify or to continue to qualify as a “regulated investment company” by complying with the provisions available to certain investment companies, as defined in Subchapter M of the U.S. Internal Revenue Code, and to make distributions of net investment income and net realized capital gains sufficient to relieve the Fund from all, or substantially all, federal income taxes. |
As of June 30, 2007, the tax cost of securities and the breakdown of unrealized appreciation (depreciation) for the Fund was as follows: |
Net | ||||||||||||||||
Unrealized | ||||||||||||||||
Tax Cost of | Unrealized | Unrealized | Appreciation | |||||||||||||
Securities | Appreciation | Depreciation | (Depreciation) | |||||||||||||
$ | 62,501,737 | $ | 3,874,425 | $ | (268,059 | ) | $ | 3,606,366 | ||||||||
(l) | Allocation of Expenses, Income, and Gains and Losses |
Expenses directly attributable to the Fund are charged to the Fund. Expenses not directly attributable to the Fund are allocated proportionately among various or all funds within the Trust. The method used by the Fund for allocating income, fund level expenses, and realized and unrealized gains or losses is based on the fair value of shares outstanding relative to net assets. Under this method, each class of shares participates based on the total net asset value of that class’s shares in proportion to the total net assets of the Fund. Expenses specific to a class (such as Rule 12b-1 and administrative services fees) are charged to that class. |
3. Transactions with Affiliates
Under the terms of the Trust’s Investment Advisory Agreement, Nationwide Fund Advisors (formerly, Gartmore Mutual Fund Capital Trust (“GMF”)) (“NFA” or the “Advisor”) manages the investment of the assets and supervises the daily business affairs of the Fund. NFA is a wholly-owned subsidiary of Nationwide Financial Services (“NFS”).
Under the terms of the Investment Advisory Agreement, the Fund pays NFA a base investment advisory fee that can vary depending on the Fund’s performance relative to the Fund’s benchmark, the S&P 500 Index, as follows:
Base Management Fee* | Fees | |||||
Up to $500 million | 0.90% | |||||
$500 million up to $2 billion | 0.80% | |||||
$2 billion or more | 0.75% | |||||
* | The Fund pays NFA a base management fee (as shown above) which may be adjusted upward or downward depending on the Fund’s performance relative to the Fund’s benchmark, the S&P 500 Index. Thus, if the Fund outperforms the Fund’s benchmark by 12% or more over a 36-month period, the Fund will pay higher management fees. Conversely, if the Fund underperforms the Fund’s benchmark by 12% or more over a 36 month period, the Fund will pay lower management fees. No adjustment will take place if the under or overperformance is less than 12% and NFA will receive the applicable base fee. The base rate and the performance rate are applied separately. The base rate (as may be reduced by any applicable base advisory fee breakpoints) is applied to the Fund’s average net assets over the current quarter, while the performance adjustment percentage is applied to the Fund’s average net assets over the rolling 36-month performance period. The corresponding dollar values then are added to arrive at the overall NFA advisory fee for the current period. The base fee is either increased or decreased by the following amounts at each breakpoint: |
Fee Schedule | Fee Adjustment | |||||
Up to $500 million | +/-0.22% | |||||
$500 million up to $2 billion | +/-0.18% | |||||
$2 billion or more | +/-0.16% | |||||
Under the terms of a Fund Administration and Transfer Agency Agreement, Nationwide Fund Management, LLC (formerly, Gartmore Investor Services, Inc. (“GISI”)) (“NFM”), a wholly-owned subsidiary of NFS Distributors, Inc. (“NFSDI”), provides the Fund with various administrative and accounting services for the Fund (prior to May 1, 2007, this service was provided by Gartmore SA Capital Trust (“GSA”)), and serves as Transfer and Dividend Disbursing Agent for the Fund (prior to May 1, 2007, this service was provided by GISI, an indirect subsidiary of GSA). The fees for the services provided under this Agreement are calculated based on the Trust’s average daily net assets according to the fee
Combined Fee Schedule* | ||||||
Up to $1 billion | 0.15% | |||||
$1 billion up to $3 billion | 0.10% | |||||
$3 billion up to $8 billion | 0.05% | |||||
$8 billion up to $10 billion | 0.04% | |||||
$10 billion up to $12 billion | 0.02% | |||||
$12 billion or more | 0.01% | |||||
* | The assets of the Nationwide NVIT Investor Destinations Aggressive Fund, the Nationwide NVIT Investor Destinations Moderately Aggressive Fund, the Nationwide NVIT Investor Destinations Moderate Fund, the Nationwide NVIT Investor Destinations Moderately Conservative Fund, and the Nationwide NVIT Investor Destinations Conservative Fund (collectively, the “Investor Destinations Funds”) are excluded from the Trust asset level amount in order to calculate this asset-based fee. The Investor Destinations Funds do not pay any part of this fee. |
NFA and NFM have entered into agreements with Citi Fund Services Ohio, Inc. (“Citi”), pursuant to which Citi provides sub-administration and sub-transfer agency services, respectively, to the Fund. Effective August 1, 2007, The BISYS Group Inc. was acquired by and became a wholly owned subsidiary of Citi.
Under the terms of a Distribution Plan under Rule 12b-1 of the 1940 Act, Nationwide Fund Distributors, LLC. (formerly, “Gartmore Distribution Services, Inc. (“GDSI”)) (“NFD” or “Distributor”), the Fund’s principal underwriter, is compensated by the Fund for expenses associated with the distribution of the Class II shares of the Fund. NFD is a wholly-owned subsidiary of NFSDI. These fees are based on average daily net assets of Class II shares of the Fund at an annual rate not to exceed 0.25%.
Under the terms of an Administrative Services Plan, the Fund may pay fees to servicing organizations, such as broker-dealers, including NFS, and financial institutions, which agree to provide administrative support services to the shareholders of certain classes. These services include, but are not limited, to the following: establishing and maintaining shareholder accounts; processing purchase and redemption transactions; arranging bank wires; performing shareholder sub-accounting; answering inquires regarding the Fund; and other such services. These fees are based on an annual rate of up to 0.25% of the average daily net assets of each class of shares of the Fund.
For the six months ended June 30, 2007, NFS received $44,092 in Administrative Services Fees from the Fund.
Under the terms of a letter agreement dated September 12, 2006, by and among NFA, the Audit Committee of the Trust and the Trust, the Trust has agreed to reimburse NFA certain costs related to the Fund’s portion of ongoing administration, monitoring and annual (audit) testing of the Trust’s Rule 38a-1 Compliance Program subject to the pre-approval of the Trust’s Audit Committee. For the six months ended June 30, 2007, the Fund’s portion of such cost amounted to $422.
4. Short-Term Trading Fees
The Fund reserves the right to assess a short-term trading fee on certain transactions out of Class III shares that a separate account makes on behalf of a variable insurance contract owner (the “contract owner”). A separate account that redeems Class III shares on behalf of a contract owner may be subject to a 1.00% short-term trading fee if the separate account held the Class III shares on behalf of the contract owner for 60 days or less, unless an exception applies as disclosed in the Fund’s prospectus. The short-term trading fee is paid directly to the Fund and is intended to offset the cost to the Fund of excess brokerage commissions and other costs associated with fluctuations in Fund asset levels and cash flow caused by short-term trading. For purposes of determining whether the short-term trading fee applies, the Class III shares that were held on behalf of the contract owner the longest will be treated as being redeemed first.
For the six months ended June 30, 2007, the Fund had contributions to capital due to collection of redemption fees in the amount of $968.
5. Investment Transactions
For the six months ended June 30, 2007, (excluding short-term securities) the Fund had purchases of $94,248,264 and sales of $101,923,557.
6. Bank Loans and Earnings Credit
The Trust has a credit agreement with JPMorgan Chase & Co., the Fund’s custodian bank, permitting the Trust to borrow up to $100,000,000. Borrowings under this arrangement bear interest at the Federal Funds rate plus 0.50%. The interest costs, if any, would be included in other fees in the Statement of Operations. No compensating balances were required under the terms of the line of credit. The line of credit is renewed annually, expiring on June 25, 2008, with a commitment fee of 0.07% per year on $100,000,000. There were no borrowings outstanding under this line of credit for the six months ended June 30, 2007.
The Trust’s custodian bank has agreed to reduce the bank’s fees (earnings credit) when the funds of the Trust maintain cash on deposit in non-interest-bearing custody and Demand Deposit Accounts. Earnings credits, if any, are shown as a reduction of total expenses on the Statement of Operations.
7. Portfolio Investment Risks
Risks Associated with Foreign Securities and Currencies. Investments in securities of foreign issuers carry certain risks not ordinarily associated with investments in securities of U.S. issuers. These risks include future political and economic developments, and the possible imposition of exchange controls or other foreign governmental laws and restrictions. In addition, with respect to certain countries, there is the possibility of expropriation of assets, confiscatory taxation, political or social instability, or diplomatic developments, which could adversely affect investments in those countries.
Certain countries also may impose substantial restrictions on investments in their capital markets by foreign entities, including restrictions on investments in issuers of industries deemed sensitive to relevant national interests. These factors may limit the investment opportunities available and result in a lack of liquidity and high price volatility with respect to securities of issuers from developing countries.
8. Indemnifications
Under the Trust’s organizational documents, certain of the Trust’s Officers and Trustees are indemnified against certain liabilities arising out of the performance of their duties to the Trust. In addition, the Trust has entered into Indemnification Agreements with the Trust’s trustees and certain officers covering similar liabilities. Trust Officers receive no compensation from the Trust for serving as the Trust’s Officers. In addition, in the normal course of business, the Trust enters into contracts with its vendors and others that provide for general indemnifications. The Trust’s maximum exposure under these arrangements is unknown, as this would involve future claims that may be made against the Trust. Based on experience, however, the Trust expects that risk of loss to be remote.
9. Recently Issued Accounting Pronouncements
On July 13, 2006, the Financial Accounting Standards Board (“FASB”) released FASB Interpretation No. 48, Accounting for Uncertainty in Income Taxes (“FIN 48”). FIN 48 provides guidance for how uncertain tax positions should be recognized, measured, presented and disclosed in the financial statements. FIN 48 requires the affirmative evaluation of tax positions taken or expected to be taken in the course of preparing the Fund’s tax returns to determine whether it is more-likely-than-not (i.e., greater than 50 percent) that each tax position will be sustained upon examination by a taxing authority based on the technical merits of the position. A tax position that meets the more-likely-than-not recognition threshold is measured to determine the amount of benefit to recognize in the financial statements. Differences between tax positions taken in a tax return and amounts recognized in the financial statements will generally result in an increase in a
In September 2006, the FASB issued Statement on Financial Accounting Standards (“SFAS”) No. 157, “Fair Value Measurements.” This standard establishes a single authoritative definition of fair value, sets out a framework for measuring fair value and requires additional disclosures about fair value measurements. SFAS No. 157 applies to fair value measurements already required or permitted by existing standards. SFAS No. 157 is effective for financial statements issued for fiscal years beginning after November 15, 2007 and interim periods within those fiscal years. The changes to current accounting principles generally accepted in the United States of America from the application of this Statement relate to the definition of fair value, the methods used to measure fair value, and the expanded disclosures about fair value measurements. As of June 30, 2007, the Fund does not believe the adoption of SFAS No. 157 will impact the financial statement amounts; however, additional disclosures may be required about the inputs used to develop the measurements and the effect of certain of the measurements on changes in net assets for the period.
Trustees who are not Interested Persons (as defined in the 1940 Act) and Officers of the Trust as of
Number of Portfolios | ||||||||||
Position(s) Held | in the | |||||||||
with the Trust | Principal Occupation(s) | Nationwide Fund | Other | |||||||
Name, Address | and Length of | During Past | Complex Overseen | Directorships | ||||||
and Year of Birth | Time Served1 | Five Years | by Trustee | Held by Trustee2 | ||||||
Charles E. Allen c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1948 | Trustee since July 2000 | Mr. Allen is Chairman, Chief Executive Officer and President of Graimark Realty Advisors, Inc. (real estate development, investment and asset management). | 89 | None | ||||||
Paula H.J. Cholmondeley c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1947 | Trustee since July 2000 | Ms. Cholmondeley was Vice President and General Manager of Sappi Fine Paper North America from April 2000 through December 2003. | 89 | Director of Dentsply International, Inc. (dental products), Ultralife Batteries, Inc., Terex Corporation (construction equipment), Minerals Technology, Inc. (specialty chemicals) and Albany International Corp. (paper industry) | ||||||
C. Brent DeVore3 c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1940 | Trustee since 1990 | Dr. DeVore is President of Otterbein College. | 89 | None | ||||||
Phyllis Kay Dryden c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1947 | Trustee since December 2004 | Ms. Dryden was a partner of Mitchell Madison, a management consulting company from January 2006 until December 2006; she is currently a consultant with the company. Ms. Dryden was formerly Managing Partner of march FIRST, a global management consulting firm. | 89 | None | ||||||
Barbara L. Hennigar c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1935 | Trustee since July 2000 | Retired. | 89 | None | ||||||
Number of Portfolios | ||||||||||
Position(s) Held | in the | |||||||||
with the Trust | Principal Occupation(s) | Nationwide Fund | Other | |||||||
Name, Address | and Length of | During Past | Complex Overseen | Directorships | ||||||
and Year of Birth | Time Served1 | Five Years | by Trustee | Held by Trustee2 | ||||||
Barbara I. Jacobs c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1950 | Trustee since December 2004 | Ms. Jacobs served as Chairman of the Board of Directors of KICAP Network Fund, a European (United Kingdom) hedge fund, from January 2001 through January 2006. From 1998-2003, Ms. Jacobs was also a Managing Director and European Portfolio Manager of CREF Investments (Teachers Insurance and Annuity Association-College Retirement Equities Fund). | 89 | None | ||||||
Douglas F. Kridler c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1955 | Trustee since September 1997 | Mr. Kridler has served as the President and Chief Executive Officer of the Columbus Foundation (a Columbus, OH-based foundation which manages over 1,300 individual endowment funds) since February 2002. Prior to January 31, 2002, Mr. Kridler was the President of the Columbus Association for the Performing Arts and Chairman of the Greater Columbus Convention and Visitors Bureau. | 89 | None | ||||||
Michael D. McCarthy c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1947 | Trustee since December 2004 | Retired. Mr. McCarthy was Chairman of VMAC (commodity swaps) from October 2002 until January 2007; and a partner of Pineville Properties LLC (a commercial real estate development firm) from September 2000 until January 2007. | 89 | None | ||||||
David C. Wetmore c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1948 | Trustee since 1995 and Chairman since February 2005 | Retired. | 89 | None | ||||||
1 | Length of time served includes time served with the Trust’s predecessors. | |
2 | Directorships held in (1) any other investment companies registered under the 1940 Act, (2) any company with a class of securities registered pursuant to Section 12 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or (3) any company subject to the requirements of Section 15(d) of the Exchange Act. | |
3 | Mr. DeVore has served as President of Otterbein College since 1984. Mark Thresher, President and Chief Operating Officer of Nationwide Financial Services, Inc. (“NFS”) has served as a member of the Board of Trustees of Otterbein College since 2000, currently serves as one of 30 of its trustees, and is currently one of two Vice Chairmen of the Board. Each of Nationwide Fund Advisors (“NFA”), the Funds’ investment adviser, and Nationwide Fund Distributors LLC (“NFD”), principal underwriter to the Trust, is a wholly-owned subsidiary of NFS. | |
Additional information regarding the Trustees and Officers may be found in the Trust’s Statement of Additional Information, which is available without charge upon request, by calling 800-848-0920. |
Trustees who are Interested Persons (as defined in the 1940 Act) and/or Officers of the Trust as of
Number of Portfolios | ||||||||||
Position(s) Held | in the | |||||||||
with the Trust | Principal Occupation(s) | Nationwide Fund | Other | |||||||
Name, Address | and Length of | During Past | Complex Overseen | Directorships | ||||||
and Year of Birth | Time Served1 | 5 Years | by Trustee | Held by Trustee 2 | ||||||
Arden L. Shisler c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1941 | Trustee since February 2000 | Retired. Mr. Shisler is the former President and Chief Executive Officer of KeB Transport, Inc., a trucking firm (2000 through 2002). He served as a consultant to KeB from January 2003 through December 2004. Since 1992, Mr. Shisler has also been Chairman of the Board for Nationwide Mutual Insurance Company.3 | 89 | Director of Nationwide Financial Services, Inc., Chairman of Nationwide Mutual Insurance Company3 | ||||||
John H. Grady Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1961 | President & Chief Executive Officer since December 2006 | Mr. Grady is President, and Chief Executive Officer of Nationwide Funds Group which includes Nationwide Fund Advisors,3 Nationwide Fund Management LLC,3 Nationwide Fund Distributors LLC 3 and NWD Investments,2 the asset management operations of Nationwide Mutual Insurance Company, which includes Morley Capital Management, Inc.,2 Nationwide Separate Accounts LLC,2 NorthPointe Capital LLC,2 and Nationwide SA Capital Trust2. From March 2004 until March 2006, Mr. Grady was Chief Executive Officer of Constellation Investment Management Co., L.P. (registered investment adviser), and President and Chief Executive Officer of Constellation Funds Group (registered investment companies). He also was President of Constellation Investment Distribution Co., Inc. (registered broker-dealer) from March 2004 until June 2006. From February 2001 until February 2004, Mr. Grady was Chief Operating and Chief Legal Officer; Managing Director, Mutual Funds Group, Turner Investment Partners, Inc. (registered investment adviser); Executive Vice President of Turner Funds and Turner Institutional Portfolios (registered investment companies); and President, Turner Investment Distributors, Inc. (registered broker-dealer). | N/A | None | ||||||
Gerald J. Holland Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1951 | Treasurer since March 2001 | Mr. Holland is Senior Vice President—Operations for Nationwide Funds Group3. | N/A | N/A | ||||||
Number of Portfolios | ||||||||||
Position(s) Held | in the | |||||||||
with the Trust | Principal Occupation(s) | Nationwide Fund | Other | |||||||
Name, Address | and Length of | During Past | Complex Overseen | Directorships | ||||||
and Year of Birth | Time Served1 | 5 Years | by Trustee | Held by Trustee 2 | ||||||
Michael A. Krulikowski Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1959 | Chief Compliance Officer from June 2004 to August 20074 | Mr. Krulikowski is Vice President and Chief Compliance Officer of Nationwide Funds Group3, Morley Capital Management, Inc.3, Nationwide SA Capital Trust (since 1999)3, and Nationwide Separate Accounts LLC (since August 2005).3 Since June 2004, Mr. Krulikowski has also served as Chief Compliance Officer of the Trust. From November 1999 through May 2007, he served as Vice President and Chief Compliance Officer of NorthPointe Capital LLC. 3 | N/A | N/A | ||||||
Eric E. Miller Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1953 | Secretary since December 2002 | Mr. Miller is Senior Vice President, General Counsel, and Assistant Secretary for Nationwide Funds Group3 and NWD Investments.2 From August 2000 to August 2002, Mr. Miller was a Partner with Stradley Ronon Stevens & Young, LLP. | N/A | N/A | ||||||
1 | Length of time served includes time served with the Trust’s predecessors. | |
2 | Directorships held in (1) any other investment companies registered under the 1940 Act, (2) any company with a class of securities registered pursuant to Section 12 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or (3) any company subject to the requirements of Section 15(d) of the Exchange Act. | |
3 | This position is held with an affiliated person or principal underwriter of the Trust. | |
4 | Effective August 3, 2007, the Board of Trustees approved Carol Baldwin Moody as Chief Compliance Officer of the Trust. Since November 2005, Ms. Moody has been Senior Vice President, Chief Compliance Officer of Nationwide Financial Services, Nationwide Life Insurance Company, Nationwide Life and Annuity Insurance Company, and Nationwide Investment Advisors, LLC. From February 2004-November 2005, she was Chief Compliance Officer of TIAA-CREF and from April 2000-February 2004, she was Managing Director and General Counsel, TCW/ Latin America Partners, LLC and Baeza & Co., LLC. | |
Federal law requires the Trust, each of its investment advisers and sub-advisers to adopt procedures for voting proxies (“Proxy Voting Guidelines”) and to provide a summary of those Proxy Voting Guidelines used to vote the securities held by the Funds. The Funds’ proxy voting policies and procedures are available without charge (i) upon request, by calling 800-848-0920, (ii) on the Funds’ website at www.nationwidefunds.com, or (iii) on the Securities and Exchange Commission’s website at www.sec.gov. |
A. Renewal of Investment Advisory Agreement
(i) General Information Regarding the Board’s Review of Investment Advisory Agreements |
The Trust’s investment advisory agreements (each an “Advisory Agreement”) with its investment adviser and, as applicable, sub-advisers (together, the “Adviser”) must be approved for an initial term no greater than two years, and renewed at least annually thereafter, (i) by the vote of the Trustees or by a vote of the shareholders of each series or fund of the Trust (individually a “Fund” ), and (ii) by the vote of a majority of the Trustees who are not parties to the Advisory Agreement or “interested persons” of any party thereto (the “Independent Trustees”) cast in person at a meeting called for the purpose of voting on such approval.
The Board meets quarterly and takes into account throughout the year matters bearing on each Fund’s Advisory Agreement. The Board and its standing committees consider at each meeting factors that are relevant to the annual renewal of an Advisory Agreement, including the services and support provided to a Fund and its shareholders.
On December 6, 2006, the Independent Trustees first met in person with their independent legal counsel (“Independent Legal Counsel”) to consider information provided by the Adviser and others to assist the Trustees in considering whether to renew each Fund’s Advisory Agreement for a one year term beginning May 1, 2007. Immediately following such meeting of the Independent Trustees, all Trustees met in person with the Adviser, Trust counsel, Independent Legal Counsel and others to consider such matters, and give preliminary consideration to information bearing on continuation of each Advisory Agreement. The primary purpose of the December 6 and 7, 2006 meeting was to ensure that the Trustees had ample opportunity to consider matters they deemed relevant in considering the continuation of an Advisory Agreement, and to request any additional information they considered reasonably necessary to their deliberations.
In preparation for the December 6 and 7, 2006 meeting the Trustees were provided, at the request of the Trustees, with a wide range of information to assist in their deliberations, including (i) reports from Lipper Inc. describing a Fund’s (a) performance rankings (where “first quintile” denotes the best performance) (over multiple years ended September 30, 2006) compared with performance groups and performance universes created by Lipper (and in some cases, customized peer groups created by the Adviser) of similar or peer group funds, and (b) expense rankings (where “first quintile” denotes the lowest fees and expenses) comparing the Fund’s contractual advisory fee and total expenses with expense groups and expense universes created by Lipper of similar or peer group funds, (ii) information from the Adviser describing the Fund’s performance (over multiple years ended September 30, 2006) compared with its benchmark and Lipper categories, (iii) for Funds under “close review,” copies of letters from the Adviser to the portfolio manager of each such Fund, together with the portfolio manager’s written response describing the reasons for the Fund’s underperformance (iv) information from the Adviser describing performance for the months of October and November, 2006, and annual performance for the year ended November 30, 2006, (v) reports from the Adviser describing the Adviser’s profitability in providing services under an Advisory Agreement, together with an explanation of Adviser’s methodology in calculating its profitability, (vi) information from the Adviser describing any fees paid to the Adviser for managing similar, non-affiliated institutional accounts, including the range of fee levels for such accounts, and (vii) information from the Adviser describing ancillary benefits, in addition to fees for serving as investment adviser, derived by the Adviser as a result of being investment adviser for a Fund, including, where applicable, information on soft-dollar benefits and fees inuring to the Adviser’s affiliates for serving as the Trust’s administrator, fund accountant and transfer agent.
At the December 6 and 7, 2006 meeting, the Trustees reviewed, considered and discussed, among themselves and with the Adviser, Trust counsel and Independent Legal Counsel, among other things, the information described above, and: (i) the nature, extent and quality of services provided by the Adviser under each Advisory Agreement, (ii) the investment performance of each Fund and the Adviser, (iii) the costs of the services provided by the Adviser under the Advisory Agreement and the profits realized by the Adviser thereunder, (iv) the extent to which economies of scale may be present and, if so, whether they are being shared with a Fund’s shareholders, (v) comparisons of the Adviser’s fees under the Advisory Agreement with investment advisory fees paid by peer group funds to their investment advisers and paid by non-affiliated institutional clients to the Adviser for managing similar accounts, and (vi) any ancillary benefits inuring to the Adviser and its affiliates as a result of being investment adviser for the Trust. The Trustees also considered, where
As part of the December 6 and 7, 2006 Board meeting, the Independent Trustees developed a list of follow-up matters and questions and asked that Adviser respond to such matters and questions at the contract approval meeting of the Board of Trustees to be held on January 11, 2007.
At the January 11, 2007 meeting of the Board of Trustees of the Trust, the Board received and considered information provided by the Adviser in follow-up from the December 6 and 7, 2006 Board meeting and, after consulting among themselves, and with the Adviser, Trust counsel and Independent Legal Counsel, concluded unanimously to renew the Advisory Agreement for the reasons set forth in the following section. In determining whether to renew the Advisory Agreement for the Fund, the Board ultimately reached a determination, with the assistance of Trust counsel and Independent Legal Counsel, that the renewal of the Advisory Agreement and the compensation to be received by the Adviser under the Advisory Agreement is consistent with the Board’s fiduciary duty under applicable law.
(ii) Board Conclusions Regarding the Fund’s Advisory Agreement |
The Board considered that the Fund had underperformed its benchmark, the S&P 500 Index, for the one- and three-year periods. The Board also considered that performance of the Fund’s Class I shares of the Fund ranked in the fifth quintile of the Fund’s Lipper-constructed Performance Group over the one-year period, the fourth quintile over the two- and three-year periods, and in the second quintile over the four-year period. Although the Fund’s performance compared with its peer group over the one- and three-year periods ranked the Fund in the fifth and fourth quintile, respectively, the Board considered among other things that: (i) longer-term relative performance had been good; (ii) the Fund’s adviser had represented that the new chief investment officer would analyze and monitor Fund performance and report quarterly to the Performance Committee; and (iii) the Fund is very concentrated and highly volatile. Based on its review, and giving particular weight to the representations made by management with respect to the actions that will be taken by the Fund’s adviser to improve relative performance, the Board concluded that the nature, extent, and quality of the services provided to the Fund will benefit the Fund’s shareholders.
The Board also considered that the Fund’s contractual advisory fee and breakpoints, and the Fund’s total expenses placed the Fund in the fifth quintile of its Lipper-constructed Expense Group. The Board found that the Fund’s contractual advisory fee is high compared to its Expense Group but noted that the Fund has implemented a performance fee structure (although waived during the year), which is intended to either reward or penalize the adviser for outperforming or underperforming, respectively, the Fund’s benchmark. The Board concluded that the Fund’s management fee and total expenses are fair and reasonable in light of the services the Fund receives and the other factors considered.
The Board also noted that the Fund’s adviser has reported a pre-tax profit margin for the twelve month-periods ended September 30, 2006 and 2005. The Board considered the costs of the services provided by and the profit realized by the Fund’s adviser in connection with the operation of the Fund and determined that the amount of profit is a fair entrepreneurial profit for the management of the Fund.
Based upon its evaluation of all of the conclusions noted above, and after considering all material factors with respect to the Fund, the Board ultimately concluded that the advisory fee structure is fair and reasonable, and that the Advisory Agreement (and, if applicable, Sub-Advisory Agreement) with respect to the Fund, should be renewed.
B. Approval of New Advisory Agreement
At its January 11, 2007 meeting, the Board also unanimously approved a new investment advisory agreement (the “New Agreement”) for the Fund with Nationwide Fund Advisors, (“NFA”) the then-current adviser to each of the series of the Trust to become effective upon the closing of the acquisition of NFA by Nationwide Financial Services, Inc. (“NFS”) from Nationwide Corporation (“NWC”) which closed on April 30, 2007 (the “Transaction”). In approving the New
C. Submission of Matters to a Vote of Security Holders:
On April 25, 2007, a Special Meeting of Shareholders was held* (the “April 25 Meeting”) at which shareholders of the Funds** set forth below were asked:
Proposal 1:
To approve a new investment advisory agreement, on behalf of their Fund, between Nationwide Fund Advisors (formerly “Gartmore Mutual Fund Capital Trust”) (the “Adviser”) and Nationwide Variable Insurance Trust (formerly “Gartmore Variable Insurance Trust”) (the “Trust”).
Number of Shares | ||||||
Fund | Cast/Not Cast | Percentages | ||||
Federated NVIT High Income Bond Fund (Formerly Federated GVIT High Income Bond Fund) | FOR AGAINST ABSTAIN TOTAL | 30,051,703.188 shares 618,245.021 shares 1,813,550.431 shares 32,483,498.640 shares | 92.514% 1.903% 5.583% | |||
NVIT International Index Fund (Formerly GVIT International Index Fund) | FOR AGAINST ABSTAIN TOTAL | 4,322,203.982 shares 2,758.318 shares 135,636.840 shares 4,460,599.140 shares | 96.897% 0.062% 3.041% | |||
NVIT International Value Fund (Formerly GVIT International Value Fund) | FOR AGAINST ABSTAIN TOTAL | 20,032,843.199 shares 333,588.902 shares 1,093,293.879 shares 21,459,725.980 shares | 93.351% 1.554% 5.095% | |||
NVIT Mid Cap Index Fund (Formerly GVIT Mid Cap Index Fund) | FOR AGAINST ABSTAIN TOTAL | 35,380,179.120 shares 631,117.844 shares 1,565,714.306 shares 37,577,011.270 shares | 94.154% 1.679% 4.167% |
Number of Shares | ||||||
Fund | Cast/Not Cast | Percentages | ||||
NVIT S&P 500 Index Fund (Formerly GVIT S&P 500 Index Fund) | FOR AGAINST ABSTAIN TOTAL | 56,119,814.230 shares 666,195.542 shares 1,944,898.888 shares 58,730,908.660 shares | 95.554% 1.134% 3.312% | |||
Nationwide Multi-Manager NVIT Small Cap Growth Fund (Formerly GVIT Small Cap Growth Fund) | FOR AGAINST ABSTAIN TOTAL | 7,632,918.513 shares 149,458.111 shares 451,583.036 shares 8,233,959.660 shares | 92.700% 1.816% 5.484% | |||
Nationwide Multi-Manager NVIT Small Cap Value Fund (Formerly GVIT Small Cap Value Fund) | FOR AGAINST ABSTAIN TOTAL | 48,649,396.525 shares 979,183.753 shares 2,786,133.102 shares 52,414,713.380 shares | 92.816% 1.868% 5.316% | |||
Nationwide Multi-Manager NVIT Small Company Fund (Formerly GVIT Small Company Fund) | FOR AGAINST ABSTAIN TOTAL | 29,903,181.700 shares 838,774.923 shares 2,006,741.307 shares 32,748,697.930 shares | 91.311% 2.561% 6.128% | |||
Gartmore NVIT Developing Markets Fund (Formerly Gartmore GVIT Developing Markets Fund) | FOR AGAINST ABSTAIN TOTAL | 21,0177,889.443 shares 424,272.958 shares 1,543,850.729 shares 23,046,013.130 shares | 91.460% 1.841% 6.699% | |||
Gartmore NVIT Emerging Markets Fund (Formerly Gartmore GVIT Emerging Markets Fund) | FOR AGAINST ABSTAIN TOTAL | 17,050,534.593 shares 526,574.722 shares 881,608.905 shares 18,458,718.220 shares | 92.371% 2.853% 4.776% | |||
Nationwide NVIT Global Financial Services Fund (Formerly Gartmore GVIT Global Financial Services Fund) | FOR AGAINST ABSTAIN TOTAL | 1,554,847.333 shares 19,539.033 shares 52,206.494 shares 1,626,592.860 shares | 95.589% 1.201% 3.210% | |||
Nationwide NVIT Global Health Sciences Fund (Formerly Gartmore GVIT Global Health Sciences Fund) | FOR AGAINST ABSTAIN TOTAL | 4,722,963.678 shares 157,979.030 shares 207,642.222 shares 5,088,584.930 shares | 92.815% 3.104% 4.081% | |||
Nationwide NVIT Global Technology and Communications Fund (Formerly Gartmore GVIT Global Technology and Communications Fund) | FOR AGAINST ABSTAIN TOTAL | 8,585,472.039 shares 102,267.977 shares 489,577.634 shares 9,177,317.650 shares | 93.551% 1.114% 5.335% | |||
Gartmore NVIT Global Utilities Fund (Formerly Gartmore GVIT Global Utilities Fund) | FOR AGAINST ABSTAIN TOTAL | 4,123,270.549 shares 122,001.533 shares 240,276.088 shares 4,485,548.170 shares | 91.923% 2.720% 5.357% | |||
Nationwide NVIT Government Bond Fund (Formerly Gartmore GVIT Government Bond Fund) | FOR AGAINST ABSTAIN TOTAL | 88,471,567.462 shares 1,825,645.181 shares 5,841,990.727 shares 96,139,203.370 shares | 92.024% 1.899% 6.077% |
Number of Shares | ||||||
Fund | Cast/Not Cast | Percentages | ||||
Nationwide NVIT Growth Fund (Formerly Gartmore GVIT Growth Fund) | FOR AGAINST ABSTAIN TOTAL | 14,931,435.904 shares 409,826.402 shares 1,259,945.064 shares 16,601,207.370 shares | 89.942% 2.469% 7.589% | |||
Gartmore NVIT International Growth Fund (Formerly Gartmore GVIT International Growth Fund) | FOR AGAINST ABSTAIN TOTAL | 6,251,419.070 shares 139,618.548 shares 290,025.592 shares 6,681,063.210 shares | 93.569% 2.090% 4.341% | |||
Nationwide NVIT Investor Destinations Aggressive Fund (Formerly Gartmore GVIT Investor Destinations Aggressive Fund) | FOR AGAINST ABSTAIN TOTAL | 49,489,224.549 shares 1,385,396.474 shares 3,696,272.337 shares 54,570,893.360 shares | 90.688% 2.539% 6.773% | |||
Nationwide NVIT Investor Destinations Conservative Fund (Formerly Gartmore GVIT Investor Destinations Conservative Fund) | FOR AGAINST ABSTAIN TOTAL | 23,091,965.887 shares 314,935,884 shares 2,292,355.179 shares 25,699,256.950 shares | 89.855% 1.225% 8.920% | |||
Nationwide NVIT Investor Destinations Moderate Fund (Formerly Gartmore GVIT Investor Destinations Moderate Fund) | FOR AGAINST ABSTAIN TOTAL | 188,902,093.059 shares 3,018,924.590 shares 16,359,690.401 shares 208,280,708.050 shares | 90.696% 1.449% 7.855% | |||
Nationwide NVIT Investor Destinations Moderately Aggressive Fund (Formerly Gartmore GVIT Investor Destinations Moderately Aggressive Fund) | FOR AGAINST ABSTAIN TOTAL | 134,792,622.920 shares 3,489,207.264 shares 9,304,197.656 shares 147,586,027.840 shares | 91.332% 2.364% 6.304% | |||
Nationwide NVIT Investor Destinations Moderately Conservative Fund (Formerly Gartmore GVIT Investor Destinations Moderately Conservative Fund) | FOR AGAINST ABSTAIN TOTAL | 49,627,123.216 shares 856,088.634 shares 3,507,215.650 shares 53,990,427.500 shares | 91.918% 1.586% 6.496% | |||
Nationwide NVIT Mid Cap Growth Fund (Formerly Gartmore GVIT Mid Cap Growth Fund) | FOR AGAINST ABSTAIN TOTAL | 10,879,584.971 shares 352,594.958 shares 717,792.971 shares 11,949,972.900 shares | 91.043% 2.950% 6.007% | |||
Nationwide NVIT Money Market Fund II (Formerly Gartmore GVIT Money Market Fund II) | FOR AGAINST ABSTAIN TOTAL | 221,774,863.241 shares 12,322,482.494 shares 16,471,740.875 shares 250,569,086.610 shares | 88.508% 4.918% 6.574% | |||
Nationwide NVIT Money Market Fund (Formerly Gartmore GVIT Money Market Fund) | FOR AGAINST ABSTAIN TOTAL | 1,578,331,008.328 shares 32,372,133.671 shares 112,652,123.301 shares 1,723,355,265.300 shares | 91.585% 1.878% 6.537% | |||
NVIT Nationwide Fund (Formerly Gartmore GVIT Nationwide Fund) | FOR AGAINST ABSTAIN TOTAL | 125,423,274.735 shares 2,767,979.467 shares 8,762,255.828 shares 136,953,510.030 shares | 91.581% 2.021% 6.398% |
Number of Shares | ||||||
Fund | Cast/Not Cast | Percentages | ||||
NVIT Nationwide Leaders Fund (Formerly Gartmore GVIT Nationwide Leaders Fund) | FOR AGAINST ABSTAIN TOTAL | 2,298,504.956 shares 29,630.469 shares 71,637.755 shares 2,399,773.180 shares | 95.780% 1.235% 2.985% | |||
Nationwide NVIT U.S. Growth Leaders Fund (Formerly Gartmore GVIT U.S. Growth Leaders Fund) | FOR AGAINST ABSTAIN TOTAL | 4,972,094.773 shares 122,623.161 shares 174,625.606 shares 5,269,343.540 shares | 94.359% 2.327% 3.314% | |||
Gartmore NVIT Worldwide Leaders Fund (Formerly Gartmore GVIT Worldwide Leaders Fund) | FOR AGAINST ABSTAIN TOTAL | 2,666,862.487 shares 47,702.491 shares 118,719.882 shares 2,833,284.860 shares | 94.126% 1.684% 4.190% | |||
JP Morgan NVIT Balanced Fund (Formerly JP Morgan GVIT Balanced Fund) | FOR AGAINST ABSTAIN TOTAL | 15,966,867.546 shares 259,004.324 shares 1,339,385.200 shares 17,565,257.070 shares | 90.900% 1.475% 7.625% | |||
Van Kampen NVIT Comstock Value Fund (Formerly Van Kampen GVIT Comstock Value Fund) | FOR AGAINST ABSTAIN TOTAL | 27,737,008.009 shares 502,564.164 shares 1,824,670.107 shares 30,064,242.280 shares | 92.259% 1.672% 6.069% | |||
Van Kampen NVIT Multi Sector Bond Fund (Formerly Van Kampen GVIT Multi Sector Bond Fund) | FOR AGAINST ABSTAIN TOTAL | 21,253,297.665 shares 484,100.920 shares 1,803,963.645 shares 23,541,362.230 shares | 90.281% 2.056% 7.663% | |||
At the April 25 Meeting, shareholders of the Nationwide NVIT Mid Cap Growth Fund were also asked to approve a new investment subadvisory agreement among the Adviser, the Trust and NorthPointe Capital LLC. The voting results with respect to that proposal are set forth below:
Proposal 2:
Number of Shares | ||||||
Fund | Cast/Not Cast | Percentages | ||||
Nationwide NVIT Mid Cap Growth Fund (Formerly Gartmore GVIT Mid Cap Growth Fund) | FOR AGAINST ABSTAIN TOTAL | 10,862,827.499 shares 414,574.660 shares 672,570.741 shares 11,949,972.900 shares | 90.903% 3.469% 5.628% | |||
* | This meeting was previously adjourned on April 23, 2007. | |
** | Fund names were changed effective May 1, 2007 to reflect “Nationwide”/“NVIT” branding to coincide with the sale of Nationwide Fund Advisors, Inc. by Nationwide Corporation to its majority-owned subsidiary, Nationwide Financial Services, Inc. |
June 30, 2007
www.nationwidefunds.com
SAR-AMF (8/07) | ![]() |
June 30, 2007 (Unaudited)
Contents | ||
4 | American Funds NVIT Asset Allocation Fund | |
13 | American Funds NVIT Bond Fund | |
22 | American Funds NVIT Global Growth Fund | |
31 | American Funds NVIT Growth Fund | |
40 | American Funds NVIT Growth-Income Fund |
Statement Regarding Availability of Proxy Voting Record.
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Dear Fellow Shareholder:
Since I last wrote to you, our mutual funds have enjoyed another period of solid performance, and the corporate realignment that was in progress is now finished.
On May 1, 2007, Nationwide Financial Services, Inc. (NFS), completed its acquisition of the Philadelphia-based retail mutual fund operations of NWD Investment Management, Inc. (formerly, “Gartmore Global Investments, Inc.”), from Nationwide Corporation, a subsidiary of Nationwide Mutual Insurance Company. Effective that date, the acquired entities were renamed Nationwide Funds Group (NFG), and the Gartmore Funds were renamed the Nationwide Funds to better align with the Nationwide® brand. Although the corporate ownership and fund names have changed, I can assure you that NFG intends to maintain as much continuity as possible with the Funds and key personnel.
Thank you, shareholders, for approving the new investment advisory agreement that was required due to the change in corporate ownership. The new agreement is identical in all material respects to the original agreement that it replaces, with the exception of the section pertaining to the vote by the shareholders of the NVIT Mid Cap Growth Fund to approve NorthPointe Capital®, LLC (NorthPointe) as sub-adviser to that particular Fund.
Market Overview: January 1-June 30, 2007
Share prices in general were buoyed in part by better-than-expected first-quarter 2007 earnings and a flurry of mergers and acquisitions, many of these spurred by readily available funding from private equity firms. In June, investors grew more cautious amid surging crude oil prices, a sudden spike in long-term interest rates, and the meltdown of two hedge funds that had exposure to the subprime mortgage market. Looking abroad, a weak U.S. dollar aided foreign stocks, as reflected in the 11.09% advance of the Morgan Stanley Capital International Europe, Australasia and Far East (MSCI EAFE®) Index. Emerging market performance was particularly robust.
The bond market struggled during the first half of 2007. While short-term interest rates remained stable, reflecting the Federal Reserve Board’s decision in June to leave the target federal funds rate at 5.25%, longer-term rates climbed during the first half of 2007, depressing bond prices and forcing the Lehman Brothers® U.S. Aggregate Index to settle for a modest 0.97% return.
We at NFG thank you for your understanding and cooperation throughout our recent transition period. We emerge from this period energized for the future, and we look forward to serving your investment needs for a long time to come.
Nationwide Funds Group
PAST PERFORMANCE IS NO GUARANTEE OF FUTURE RESULTS.
Nationwide Funds are advised by Nationwide Fund Advisors (NFA). NFA is a wholly-owned subsidiary of Nationwide Financial Services. Nationwide Financial Services is a wholly-owned subsidiary of Nationwide Corporation. All of the common stock of Nationwide Corporation is held by Nationwide Mutual (95.2%) and Nationwide Mutual Fire Insurance Company (4.8%), each of which is a mutual company owned by its policyholders.
Nationwide Funds Group (NFG) is the mutual fund arm of Nationwide Financial Services (NYSE: NFS). Based in Conshohocken, Pa., a suburb of Philadelphia, NFG is comprised of Nationwide Fund Advisors, Nationwide Fund Distributors, LLC, and Nationwide Fund Management, LLC. Together, these provide advisory, distribution, and administration services respectively to the Nationwide Funds, and manage more than $43.5 billion in assets as of June 30, 2007, of which more than $12 billion are in “fund of funds” designed to provide asset allocation across several types of investments and asset classes.
Lehman Brothers (LB) U.S. Aggregate Index: An unmanaged, market value-weighted index of investment-grade, fixed-rate debt issues (including government, corporate, asset-backed, and mortgage-backed securities with maturities of one year or more) that is generally representative of the bond market as a whole.
Morgan Stanley Capital International Europe, Australasia and Far East (MSCI EAFE®) Index: An unmanaged, free float-adjusted, market capitalization-weighted index that is designed to measure the performance of stocks in developed markets outside the United States and Canada.
Standard & Poor’s 500® (S&P 500) Index: An unmanaged, market capitalization-weighted index of 500 widely held stocks of large-cap U.S. companies that gives a broad look at how the stock prices of those companies have performed.
Views expressed within are those of Nationwide Funds Group as of the date noted, are subject to change at any time, and may not come to pass.
This report is for informational purposes only, and is not intended as an offer or recommendation with respect to the purchase or sale of any security, option, future, or other derivatives in such securities.
Investing in mutual funds involves risk, including possible loss of principal.
Investors should carefully consider a fund’s investment objectives, risks, fees, charges, and expenses before investing any money. To obtain this and other fund information, please call 800-848-0920 to request a prospectus, or download a prospectus at www.nationwidefunds.com. Please read the prospectus carefully before investing any money.
Nationwide Funds distributed by Nationwide Fund Distributors LLC (formerly Gartmore Distribution Services, Inc.), Member NASD. 1200 River Road, Suite 1000, Conshohocken, Pa. 19428.
As a shareholder of the Fund, you incur two types of costs: (1) transaction costs, including sales charges (loads) paid on purchase payments and redemption fees; and (2) ongoing costs, including investment advisory fees, administration fees, distribution fees and other Fund expenses. The examples below are 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. Per SEC requirements, the examples assume that you had a $1,000 investment in the Class at the beginning of the reporting period, January 1, 2007, and continued to hold your shares at the end of the reporting period, June 30, 2007.
Actual Expenses
Hypothetical Example for Comparison Purposes
Please note that the expenses shown in the table are meant to highlight your ongoing costs only and do not reflect any transaction costs, such as sales charges (loads) or redemption fees. Therefore, the second line for each Class in 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 transaction costs were included, your costs would have been higher. The examples also assume all dividends and distributions have been reinvested.
Schedule of Shareholder Expenses
Beginning | Ending | |||||||||||||||||||||
American Funds NVIT Asset | Account Value | Account Value | Expenses Paid | Annualized | ||||||||||||||||||
Allocation Fund | 1/1/07 | 06/30/07 | During Period* | Expense Ratio* | ||||||||||||||||||
Class II | Actual | $ | 1,000.00 | $ | 1,075.70 | $ | 3.71 | 0.72% | ||||||||||||||
Hypothetical | 1 | $ | 1,000.00 | $ | 1,021.23 | $ | 3.61 | 0.72% | ||||||||||||||
Class VII | Actual | $ | 1,000.00 | $ | 1,077.50 | $ | 1.70 | 0.33% | ||||||||||||||
Hypothetical | 1 | $ | 1,000.00 | $ | 1,023.16 | $ | 1.66 | 0.33% | ||||||||||||||
* | Expenses are equal to the Fund’s annualized expense ratio multiplied by the average account value over the period multiplied by 181/365 (to reflect the one-half year period). The expense ratio presented represents a six-month, annualized ratio in accordance with SEC guidelines. The expenses reported above do not include the effect of additional expenses imposed by variable annuity contracts. | |
1 | Represents the hypothetical 5% return before expenses. |
American Funds | ||||||
NVIT Asset | ||||||
Allocation Fund | ||||||
Assets: | ||||||
Investments in Master Fund (cost $293,111,718) | $ | 304,582,882 | ||||
Receivable for capital shares issued | 848,449 | |||||
Prepaid expenses | 2,622 | |||||
Total Assets | 305,433,953 | |||||
Liabilities: | ||||||
Payable for capital shares redeemed | 565 | |||||
Accrued expenses and other payables: | ||||||
Fund administration and transfer agent fees | 16,591 | |||||
Master feeder service provider fee | 24,174 | |||||
Distribution fees | 60,437 | |||||
Administrative servicing fees | 83,917 | |||||
Compliance program costs | 1,922 | |||||
Other | 460 | |||||
Total Liabilities | 188,066 | |||||
Net Assets | $ | 305,245,887 | ||||
Represented by: | ||||||
Capital | $ | 284,323,616 | ||||
Accumulated net investment loss | (58,209 | ) | ||||
Accumulated net realized gains from investment transactions and distributions from Master Fund | 9,509,316 | |||||
Net unrealized appreciation on investments | 11,471,164 | |||||
Net Assets | $ | 305,245,887 | ||||
Net Assets: | ||||||
Class II Shares | $ | 305,244,749 | ||||
Class VII Shares | 1,138 | |||||
Total | $ | 305,245,887 | ||||
Shares outstanding (unlimited number of shares authorized): | ||||||
Class II Shares | 15,301,198 | |||||
Class VII Shares | 57 | |||||
Total | 15,301,255 | |||||
Net asset value and offering price per share (Net assets by class divided by shares outstanding by class, respectively): | ||||||
Class II Shares | $ | 19.95 | ||||
Class VII Shares | $ | 20.03 | (a) | |||
(a) | The NAV reported above represents the traded NAV at June 30, 2007. Due to the financial statement rounding of class assets and class shares above, the NAV results in a different NAV than the traded NAV. |
5
American Funds | |||||
NVIT Asset | |||||
Allocation Fund | |||||
INVESTMENT INCOME: | |||||
Dividend income | $ | 1,132,843 | |||
Total Income | 1,132,843 | ||||
Expenses: | |||||
Fund administration and transfer agent fees | 67,873 | ||||
Master feeder service provider fee | 283,287 | ||||
Distribution fees Class II Shares | 283,288 | ||||
Distribution fees Class VII Shares | 2 | ||||
Administrative servicing fees Class II Shares | 315,342 | ||||
Custodian fees | 1,379 | ||||
Trustee fees | 4,184 | ||||
Compliance program costs (Note 3) | 1,458 | ||||
Other | 24,111 | ||||
Total expenses before earnings credit | 980,924 | ||||
Expenses waived for Master feeder service provider fee | (169,973 | ) | |||
Earnings credit (Note 4) | (421 | ) | |||
Net Expenses | 810,530 | ||||
Net Investment Income | 322,313 | ||||
REALIZED/UNREALIZED GAINS (LOSSES) FROM INVESTMENTS: | |||||
Net realized gains on investment transactions | 16,147 | ||||
Net realized gain distributions from Master Fund | 9,494,837 | ||||
Net realized gains on investment transactions and distributions from Master Fund | 9,510,984 | ||||
Net change in unrealized appreciation on investments | 6,878,753 | ||||
Net realized/unrealized gains (losses) on investments | 16,389,737 | ||||
CHANGE IN NET ASSETS RESULTING FROM OPERATIONS | $ | 16,712,050 | |||
6
American Funds NVIT | |||||||||
Asset Allocation Fund | |||||||||
Six Months Ended | Year Ended | ||||||||
June 30, 2007 | December 31, 2006 (a) | ||||||||
(Unaudited) | |||||||||
From Investment Activities: | |||||||||
Operations: | |||||||||
Net investment income | $ | 322,313 | $ | 2,673,314 | |||||
Net realized gains on investment transactions and distributions from Master Fund | 9,510,984 | 169,123 | |||||||
Net change in unrealized appreciation on investments | 6,878,753 | 4,592,411 | |||||||
Change in net assets resulting from operations | 16,712,050 | 7,434,848 | |||||||
Distributions to shareholders from: | |||||||||
Net investment income: | |||||||||
Class II | (383,817 | ) | (2,685,081 | ) | |||||
Class VII | (2 | ) | (17 | ) | |||||
Net realized gains: | |||||||||
Class II | (170,790 | ) | – | ||||||
Class VII | (1 | ) | – | ||||||
Change in net assets from shareholder distributions | (554,610 | ) | (2,685,098 | ) | |||||
Change in net assets from capital transactions | 126,338,657 | 158,000,040 | |||||||
Change in net assets | 142,496,097 | 162,749,790 | |||||||
Net Assets: | |||||||||
Beginning of period | 162,749,790 | – | |||||||
End of period | $ | 305,245,887 | $ | 162,749,790 | |||||
Accumulated net investment income (loss) at end of period | $ | (58,209 | ) | $ | 3,297 | ||||
CAPITAL TRANSACTIONS: | |||||||||
Class II Shares | |||||||||
Proceeds from shares issued | $ | 128,977,960 | $ | 155,792,024 | |||||
Dividends reinvested | 554,587 | 2,685,081 | |||||||
Cost of shares redeemed | (3,193,893 | ) | (478,082 | ) | |||||
126,338,654 | 157,999,023 | ||||||||
Class VII Shares | |||||||||
Proceeds from shares issued | – | 1,000 | |||||||
Dividends reinvested | 3 | 17 | |||||||
3 | 1,017 | ||||||||
Change in net assets from capital transactions | $ | 126,338,657 | $ | 158,000,040 | |||||
SHARE TRANSACTIONS: | |||||||||
Class II Shares | |||||||||
Issued | 6,680,887 | 8,640,005 | |||||||
Reinvested | 27,883 | 144,250 | |||||||
Redeemed | (165,183 | ) | (26,644 | ) | |||||
6,543,587 | 8,757,611 | ||||||||
Class VII Shares | |||||||||
Issued | – | 56 | |||||||
Reinvested | – | (b) | 1 | ||||||
– | 57 | ||||||||
Total change in shares | 6,543,587 | 8,757,668 | |||||||
(a) | For the period from May 1, 2006 (commencement of operations) through December 31, 2006. | |
(b) | Amount is less than 1 share. |
7
Investment Activities | Distributions | |||||||||||||||||||||||||||||||||||
Net Realized | ||||||||||||||||||||||||||||||||||||
Net Asset | and | Total | Net Asset | |||||||||||||||||||||||||||||||||
Value, | Net | Unrealized | from | Net | Net | Value, | ||||||||||||||||||||||||||||||
Beginning | Investment | Gains on | Investment | Investment | Realized | Total | End | Total | ||||||||||||||||||||||||||||
of Period | Income | Investments | Activities | Income | Gains | Distributions | of Period | Return (a) | ||||||||||||||||||||||||||||
Class II Shares | ||||||||||||||||||||||||||||||||||||
Period ended December 31, 2006 (e) | $ | 17.92 | 0.36 | 0.66 | 1.02 | (0.36 | ) | – | (0.36 | ) | $ | 18.58 | 5.69% | |||||||||||||||||||||||
For the six months ended June 30, 2007 (Unaudited) | $ | 18.58 | 0.03 | 1.38 | 1.41 | (0.03 | ) | (0.01 | ) | (0.04 | ) | $ | 19.95 | 7.57% | ||||||||||||||||||||||
Class VII Shares | ||||||||||||||||||||||||||||||||||||
Period ended December 31, 2006 (e) | $ | 17.92 | 0.55 | 0.46 | 1.01 | (0.30 | ) | – | (0.30 | ) | $ | 18.63 | 5.64% | |||||||||||||||||||||||
For the six months ended June 30, 2007 (Unaudited) | $ | 18.63 | 0.04 | 1.40 | 1.44 | (0.03 | ) | (0.01 | ) | (0.04 | ) | $ | 20.03 | 7.75% | ||||||||||||||||||||||
[Additional columns below]
[Continued from above table, first column(s) repeated]
Ratios / Supplemental Data | ||||||||||||||||||||||||||
Ratio of | Ratio of Net | |||||||||||||||||||||||||
Net | Ratio of | Investment | ||||||||||||||||||||||||
Ratio of | Investment | Expenses | Income | |||||||||||||||||||||||
Net Assets | Expenses | Income | (Prior to | (Prior to | ||||||||||||||||||||||
at End of | to Average | to Average | Reimbursements) | Reimbursements) | ||||||||||||||||||||||
Period | Net | Net | to Average | to Average | Portfolio | |||||||||||||||||||||
(000s) | Assets (b) | Assets(b) | Net Assets (b)(c) | Net Assets (b)(c) | Turnover (d) | |||||||||||||||||||||
Class II Shares | ||||||||||||||||||||||||||
Period ended December 31, 2006 (e) | $ | 162,749 | 0.69% | 6.18% | 0.86% | 6.00% | 38.00% | |||||||||||||||||||
For the six months ended June 30, 2007 (Unaudited) | $ | 305,245 | 0.72% | 0.28% | 0.87% | 0.13% | 18.00% | |||||||||||||||||||
Class VII Shares | ||||||||||||||||||||||||||
Period ended December 31, 2006 (e) | $ | 1 | 0.80% | 4.51% | 0.87% | 4.43% | 38.00% | |||||||||||||||||||
For the six months ended June 30, 2007 (Unaudited) | $ | 1 | 0.33% | 0.48% | 0.48% | 0.33% | 18.00% | |||||||||||||||||||
(a) | Not annualized for periods less than one year. | |
(b) | Annualized for periods less than one year. | |
(c) | During the period, certain fees were waived and/or reimbursed. If such waivers/reimbursements had not occurred, the ratios would have been as indicated. | |
(d) | Portfolio turnover is calculated on the basis of the respective Portfolio in which the Fund invests all of its investable assets. | |
(e) | For the period from May 1, 2006 (commencement of operations) through December 31, 2006. |
See accompanying notes to financial statements.
1. Organization
Nationwide Variable Insurance Trust (“NVIT” or the “Trust”) is an open-end management investment company, organized under the laws of Delaware by an amended and restated Agreement and Declaration of Trust, dated October 28, 2004, as amended to date. The Trust, originally created under the laws of Massachusetts as a Massachusetts business trust pursuant to a Declaration of Trust dated, as of June 30, 1981, and as subsequently amended, redomesticated as a Delaware Statutory Trust after the close of trading on April 29, 2005, and is registered under the Investment Company Act of 1940, as amended (the “1940 Act”). The redomestication was a change in statutory status and did not affect the operations of the Trust. As of June 30, 2007, the Trust had authorized an unlimited number of shares of beneficial interest, without par value (“shares”). The Trust currently offers shares to life insurance company separate accounts to fund the benefits under variable life insurance or annuity policies. To date, only the separate accounts of Nationwide Life Insurance Company and Nationwide Life and Annuity Insurance Company (collectively, “Nationwide”) have purchased shares of the American Funds NVIT Asset Allocation Fund (the “Fund”), (formerly, “American Funds GVIT Asset Allocation Fund”). The Trust currently operates forty (40) separate series, or mutual funds, each with its own investment objectives and strategies. This report contains the financial statements and financial highlights of the Fund.
The Fund operates as a “feeder fund” which means that the Fund does not buy individual securities directly. Instead, the Fund invests all of its assets in another mutual fund, the American Asset Allocation Fund (the “Master Fund”), a series of the American Funds Insurance Series® (“American Funds”), which invests directly in individual securities. The Fund, therefore, has the same investment objective and limitations as the Master Fund in which the Fund invests and the same gross investment returns as the Master Fund. The financial statements of the Master Fund’s portfolio, including the Statement of Investments, are included elsewhere in this report and should be read with the Fund’s financial statements. The percentage of the Master Fund’s portfolio owned by the Fund at June 30, 2007, was 3.55%.
2. Summary of Significant Accounting Policies
The following is a summary of significant accounting policies followed by the Fund in the preparation of its financial statements. The policies are in conformity with accounting principles generally accepted in the United States of America (“GAAP”). The preparation of financial statements requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of income and expenses for the period. Actual results could differ from those estimates.
(a) | Security Valuation |
The net asset value (“NAV”) per share of each class of the Fund is calculated by taking the market value of the Master Fund and other assets owned by the Fund, allocated to the class, subtracting the Fund’s liabilities attributable to that class, and dividing by the number of shares of that class that are outstanding. The Fund’s NAV is determined at the close of regular trading on the New York Stock Exchange (the “Exchange”) (usually 4 p.m. Eastern Time) (“Close of Trading”) on each day the Exchange is open for trading (“Business Day”). | |
The Master Fund calculates its NAV at the Close of Trading on each Business Day. Assets held by the Master Fund are valued primarily on the basis of market quotations. The Master Fund, however, has adopted procedures for making “fair value” determinations if market quotations are not readily available. For example, if events occur between the close of markets outside the United States and the close of regular trading on the New York Stock Exchange that, in the opinion of Capital Research and Management Company (“Capital Research”), the Master Fund’s investment adviser, materially affect the value of the portfolio securities of the Master Fund, the securities will be valued in accordance with the Master Fund’s fair value procedures. Use of these procedures is intended to result in more appropriate NAVs. In addition, such use will reduce, if not eliminate, potential arbitrage opportunities otherwise available to short-term investors in the Master Fund. |
(b) | Security Transactions and Investment Income |
Security transactions are accounted for on the date the security is purchased or sold (“trade date”). Securities gains and losses are calculated on the identified cost basis. Interest income is recognized on the accrual basis and includes, where applicable, the amortization or accretion of premium or discount. Dividend income is recorded on the ex-dividend date. |
(c) | Distributions to Shareholders |
The Fund’s dividends from net investment income, if any, are declared and paid quarterly. The Fund’s distributions from net realized capital gains, if any, are declared and distributed at least annually. | |
Dividends and distributions to shareholders are determined in accordance with federal income tax regulations, which may differ from GAAP. These “book/tax” differences are considered either permanent or temporary in nature. In accordance with the American Institute of Certified Public Accountants Statement of Position 93-2, permanent differences (i.e., reclassification of market discounts, foreign exchange gain/loss, paydowns, and distributions from real estate investment trusts) are reclassified within the capital accounts based on their nature for federal income tax purposes; temporary differences do not require reclassification. These reclassifications have no effect upon the net asset value of the Fund. To the extent distributions exceed current and accumulated earnings and profits for federal income tax purposes, these distributions are reported as distributions of paid-in-capital. |
(d) | Federal Income Taxes |
It is the policy of the Fund to qualify or to continue to qualify as a “regulated investment company” by complying with the provisions available to certain investment companies, as defined in Subchapter M of the U.S. Internal Revenue Code, and to make distributions of net investment income and net realized capital gains sufficient to relieve the Fund from all, or substantially all, federal income taxes. | |
As of June 30, 2007, the tax cost of securities and the breakdown of unrealized appreciation (depreciation) for the Fund was as follows: |
Net Unrealized | ||||||||||||||
Tax Cost of | Unrealized | Unrealized | Appreciation | |||||||||||
Securities | Appreciation | Depreciation | (Depreciation) | |||||||||||
$ | 293,113,386 | $ | 11,469,496 | $ | — | $ | 11,469,496 | |||||||
(e) | Allocation of Expenses, Income, and Gains and Losses |
Expenses directly attributable to the Fund are charged to the Fund. Expenses not directly attributable to the Fund are allocated proportionately among various or all funds within the Trust. The method used by the Fund for allocating income, fund level expenses, and realized and unrealized gains or losses is based on the fair value of shares outstanding relative to net assets. Under this method, each class of shares participates based on the total net asset value of that class’s shares in proportion to the total net assets of the Fund. Expenses specific to a class (such as Rule 12b-1 and administrative services fees) are charged to that class. |
3. Transactions with Affiliates
Under the terms of the Master Fund’s Investment Advisory Agreement, Capital Research manages the investment of the assets and supervises the daily business affairs of the Master Fund. Nationwide Fund Management, LLC (prior to May 1, 2007, this service was provided by Gartmore SA Capital Trust (“GSA”)) (“NFM”), a wholly-owned subsidiary of NFS Distributors, Inc. (“NFSDI”), provides non-investment master-feeder operational support services to the Fund. Under the terms of the Trust’s Master-Feeder Services Agreement with NFM on behalf of the Fund, the Fund pays NFM a fee of 0.25% based on the Fund’s average daily net assets. NFM has entered into a contractual agreement with the Trust under
Under the terms of a Fund Administration and Transfer Agency Agreement, NFM provides the Fund with various administrative and accounting services for the Fund (prior to May 1, 2007, this service was provided by GSA), and serves as Transfer and Dividend Disbursing Agent for the Fund (prior to May 1, 2007, this service was provided by Gartmore Investor Services, Inc. (“GISI”), an indirect subsidiary of GSA). The fees for the services provided under this Agreement are calculated based on the Trust’s average daily net assets according to the fee schedule below. The fees are then allocated proportionately among all funds within the Trust in relation to the average daily net assets of each fund and are paid to NFA. NFA pays NFM from these fees for NFM’s services.
Combined Fee Schedule* | ||||||
Up to $1 billion | 0.15% | |||||
$1 billion up to $3 billion | 0.10% | |||||
$3 billion up to $8 billion | 0.05% | |||||
$8 billion up to $10 billion | 0.04% | |||||
$10 billion up to $12 billion | 0.02% | |||||
$12 billion or more | 0.01% | |||||
* | The assets of the Nationwide NVIT Investor Destinations Aggressive Fund, the Nationwide NVIT Investor Destinations Moderately Aggressive Fund, the Nationwide NVIT Investor Destinations Moderate Fund, the Nationwide NVIT Investor Destinations Moderately Conservative Fund, and the Nationwide NVIT Investor Destinations Conservative Fund (collectively, the “Investor Destinations Funds”) are excluded from the Trust asset level amount in order to calculate this asset-based fee. The Investor Destinations Funds do not pay any part of this fee. |
NFM has entered into agreements with Citi Fund Services Ohio, Inc. (“Citi”), pursuant to which Citi provides sub-administration and sub-transfer agency services, respectively, to the Fund. Effective August 1, 2007, The BISYS Group Inc. was acquired by and became a wholly owned subsidiary of Citi.
Under the terms of a Distribution Plan under Rule 12b-1 of the 1940 Act, Nationwide Fund Distributors, LLC. (formerly, “Gartmore Distribution Services, Inc. (“GDSI”)) (“NFD” or “Distributor”), the Fund’s principal underwriter, is compensated by the Fund for expenses associated with the distribution of the Class II and Class VII shares of the Fund. NFD is a wholly-owned subsidiary of NFSDI. These fees are based on average daily net assets of Class II and Class VII shares of the Fund at an annual rate not to exceed 0.25% of Class II shares and 0.40% of Class VII shares.
Under the terms of an Administrative Services Plan, the Fund may pay fees to servicing organizations, such as broker-dealers, including Nationwide Financial Services, Inc. (“NFS”), and financial institutions, which agree to provide administrative support services to the shareholders of certain classes. NFM is a wholly-owned subsidiary of NFS. These services include, but are not limited, to the following: establishing and maintaining shareholder accounts; processing purchase and redemption transactions; arranging bank wires; performing shareholder sub-accounting; answering inquires regarding the Fund; and other such services. These fees are based on an annual rate of up to 0.25% of the average daily net assets of each class of shares of the Fund.
For the six months ended June 30, 2007, NFS received $284,555 in Administrative Services Fees from the Fund.
Under the terms of a letter agreement dated September 12, 2006, by and among NFM, the Audit Committee of the Trust and the Trust, the Trust has agreed to reimburse NFM certain costs related to the Fund’s portion of ongoing administration, monitoring and annual (audit) testing of the Trust’s Rule 38a-1 Compliance Program subject to the pre-approval of the Trust’s Audit Committee. For the six months ended June 30, 2007, the Fund’s portion of such costs amounted to $1,458.
4. Bank Loans and Earnings Credit
The Trust has a credit agreement with JPMorgan Chase & Co., the Fund’s custodian bank, permitting the Trust to borrow up to $100,000,000. Borrowings under this arrangement bear interest at the Federal Funds rate plus 0.50%. The interest costs, if any, would be included in other fees in the Statement of Operations. No compensating balances were required under the terms of the line of credit. The line of credit is renewed annually, expiring on June 25, 2008, with a commitment fee of 0.07% per year on $100,000,000. There were no borrowings outstanding under this line of credit for the six months ended June 30, 2007.
The Trust’s custodian bank has agreed to reduce the bank’s fees (earnings credit) when the funds of the Trust maintain cash on deposit in non-interest-bearing custody and Demand Deposit Accounts. Earnings credits, if any, are shown as a reduction of total expenses on the Statement of Operations.
5. Indemnifications
Under the Trust’s organizational documents, certain of the Trust’s Officers and Trustees are indemnified against certain liabilities arising out of the performance of their duties to the Trust. In addition, the Trust has entered into Indemnification Agreements with the Trust’s trustees and certain officers covering similar liabilities. Trust Officers receive no compensation from the Trust for serving as the Trust’s Officers. In addition, in the normal course of business, the Trust enters into contracts with its vendors and others that provide for general indemnifications. The Trust’s maximum exposure under these arrangements is unknown, as this would involve future claims that may be made against the Trust. Based on experience, however, the Trust expects that risk of loss to be remote.
6. Recently Issued Accounting Pronouncements
On July 13, 2006, the Financial Accounting Standards Board (“FASB”) released FASB Interpretation No. 48, Accounting for Uncertainty in Income Taxes (“FIN 48”). FIN 48 provides guidance for how uncertain tax positions should be recognized, measured, presented and disclosed in the financial statements. FIN 48 requires the affirmative evaluation of tax positions taken or expected to be taken in the course of preparing the Fund’s tax returns to determine whether it is more-likely-than-not (i.e., greater than 50 percent) that each tax position will be sustained upon examination by a taxing authority based on the technical merits of the position. A tax position that meets the more-likely-than-not recognition threshold is measured to determine the amount of benefit to recognize in the financial statements. Differences between tax positions taken in a tax return and amounts recognized in the financial statements will generally result in an increase in a liability for taxes payable (or a reduction of a tax refund receivable) and an increase in a deferred tax liability (or a reduction in a deferred tax asset). Adoption of FIN 48 was required no later than the last business day of the first financial statement reporting period for fiscal years beginning after December 15, 2006 and is to be applied to all open tax years as of the effective date. Accordingly, the Fund was required to implement FIN 48 in its net asset value per share (NAV) calculation on June 29, 2007. Management has evaluated the implications of FIN 48 and has concluded that there was no impact to the Fund’s financial statements as of June 29, 2007. The adoption of FIN 48 requires ongoing monitoring and analysis, future conclusions reached by management may be different and result in adjustments to the Fund’s NAV and financial statements.
In September 2006, the FASB issued Statement on Financial Accounting Standards (“SFAS”) No. 157, “Fair Value Measurements.” This standard establishes a single authoritative definition of fair value, sets out a framework for measuring fair value and requires additional disclosures about fair value measurements. SFAS No. 157 applies to fair value measurements already required or permitted by existing standards. SFAS No. 157 is effective for financial statements issued for fiscal years beginning after November 15, 2007 and interim periods within those fiscal years. The changes to current accounting principles generally accepted in the United States of America from the application of this Statement relate to the definition of fair value, the methods used to measure fair value, and the expanded disclosures about fair value measurements. As of June 30, 2007, the Fund does not believe the adoption of SFAS No. 157 will impact the financial statement amounts; however, additional disclosures may be required about the inputs used to develop the measurements and the effect of certain of the measurements on changes in net assets for the period.
As a shareholder of the Fund, you incur two types of costs: (1) transaction costs, including sales charges (loads) paid on purchase payments and redemption fees; and (2) ongoing costs, including investment advisory fees, administration fees, distribution fees and other Fund expenses. The examples below are 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. Per SEC requirements, the examples assume that you had a $1,000 investment in the Class at the beginning of the reporting period, January 1, 2007, and continued to hold your shares at the end of the reporting period, June 30, 2007.
Actual Expenses
Hypothetical Example for Comparison Purposes
Please note that the expenses shown in the table are meant to highlight your ongoing costs only and do not reflect any transaction costs, such as sales charges (loads) or redemption fees. Therefore, the second line for each Class in 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 transaction costs were included, your costs would have been higher. The examples also assume all dividends and distributions have been reinvested.
Schedule of Shareholder Expenses
Beginning | Ending | |||||||||||||||||||||
Account Value | Account Value | Expenses Paid | Annualized | |||||||||||||||||||
American Funds NVIT Bond Fund | 1/1/07 | 06/30/07 | During Period* | Expense Ratio* | ||||||||||||||||||
Class II | Actual | $ | 1,000.00 | $ | 1,012.90 | $ | 3.64 | 0.73% | ||||||||||||||
Hypothetical | 1 | $ | 1,000.00 | $ | 1,021.18 | $ | 3.66 | 0.73% | ||||||||||||||
Class VII | Actual | $ | 1,000.00 | $ | 1,014.90 | $ | 1.70 | 0.34% | ||||||||||||||
Hypothetical | 1 | $ | 1,000.00 | $ | 1,023.11 | $ | 1.71 | 0.34% | ||||||||||||||
* | Expenses are equal to the Fund’s annualized expense ratio multiplied by the average account value over the period multiplied by 181/365 (to reflect the one-half year period). The expense ratio presented represents a six-month, annualized ratio in accordance with SEC guidelines. The expenses reported above do not include the effect of additional expenses imposed by variable annuity contracts. | |
1 | Represents the hypothetical 5% return before expenses. |
American Funds | ||||||
NVIT Bond Fund | ||||||
Assets: | ||||||
Investments in Master Fund (cost $76,895,431) | $ | 75,682,689 | ||||
Receivable for capital shares issued | 121,966 | |||||
Prepaid expenses | 622 | |||||
Total Assets | 75,805,277 | |||||
Liabilities: | ||||||
Payable to custodian | 72 | |||||
Payable for capital shares redeemed | 371 | |||||
Accrued expenses and other payables: | ||||||
Fund administration and transfer agent fees | 3,532 | |||||
Master feeder service provider fee | 5,771 | |||||
Distribution fees | 14,427 | |||||
Administrative servicing fees | 20,520 | |||||
Compliance program costs | 423 | |||||
Other | 4,706 | |||||
Total Liabilities | 49,822 | |||||
Net Assets | $ | 75,755,455 | ||||
Represented by: | ||||||
Capital | $ | 76,980,507 | ||||
Accumulated net investment loss | (14,484 | ) | ||||
Accumulated net realized gains from investment transactions | 2,174 | |||||
Net unrealized depreciation on investments | (1,212,742 | ) | ||||
Net Assets | $ | 75,755,455 | ||||
Net Assets: | ||||||
Class II Shares | $ | 75,754,387 | ||||
Class VII Shares | 1,068 | |||||
Total | $ | 75,755,455 | ||||
Shares outstanding (unlimited number of shares authorized): | ||||||
Class II Shares | 6,609,391 | |||||
Class VII Shares | 93 | |||||
Total | 6,609,484 | |||||
Net asset value and offering price per share (Net assets by class divided by shares outstanding by class, respectively.): | ||||||
Class II Shares | $ | 11.46 | ||||
Class VII Shares | $ | 11.48 | ||||
14
American Funds | |||||
NVIT Bond Fund | |||||
INVESTMENT INCOME: | |||||
Dividend income | $ | 2,656,020 | |||
Total Income | 2,656,020 | ||||
Expenses: | |||||
Fund administration and transfer agent fees | 15,532 | ||||
Master feeder service provider fee | 65,195 | ||||
Distribution fees Class II Shares | 65,195 | ||||
Distribution fees Class VII Shares | 2 | ||||
Administrative servicing fees Class II Shares | 73,175 | ||||
Custodian fees | 74 | ||||
Trustee fees | 830 | ||||
Compliance program costs (Note 3) | 325 | ||||
Other | 9,951 | ||||
Total expenses before earnings credit | 230,279 | ||||
Expenses waived for Master feeder service provider fee | (39,117 | ) | |||
Earnings credit (Note 4) | (37 | ) | |||
Net Expenses | 191,125 | ||||
Net Investment Income | 2,464,895 | ||||
REALIZED/UNREALIZED GAINS (LOSSES) FROM INVESTMENTS: | |||||
Net realized gains on investment transactions | 7,683 | ||||
Net change in unrealized depreciation on investments | (2,045,070 | ) | |||
Net realized/unrealized gains (losses) on investments | (2,037,387 | ) | |||
CHANGE IN NET ASSETS RESULTING FROM OPERATIONS | $ | 427,508 | |||
15
American Funds NVIT | |||||||||
Bond Fund | |||||||||
Six Months Ended | Year Ended | ||||||||
June 30, 2007 | December 31, 2006(a) | ||||||||
(Unaudited) | |||||||||
From Investment Activities: | |||||||||
Operations: | |||||||||
Net investment income | $ | 2,464,895 | $ | 44,623 | |||||
Net realized gains (losses) on investment transactions | 7,683 | (4,556 | ) | ||||||
Net change in unrealized appreciation/depreciation on investments | (2,045,070 | ) | 832,328 | ||||||
Change in net assets resulting from operations | 427,508 | 872,395 | |||||||
Distributions to shareholders from: | |||||||||
Net investment income: | |||||||||
Class II | (2,479,342 | ) | (49,730 | ) | |||||
Class VII | (37 | ) | (12 | ) | |||||
Tax return of capital: | |||||||||
Class II | – | (64,936 | ) | ||||||
Class VII | – | (15 | ) | ||||||
Change in net assets from shareholder distributions | (2,479,379 | ) | (114,693 | ) | |||||
�� | |||||||||
Change in net assets from capital transactions | 44,133,762 | 32,915,862 | |||||||
Change in net assets | 42,081,891 | 33,673,564 | |||||||
Net Assets: | |||||||||
Beginning of period | 33,673,564 | – | |||||||
End of period | $ | 75,755,455 | $ | 33,673,564 | |||||
Accumulated net investment income (loss) at end of period | $ | (14,484 | ) | $ | – | ||||
CAPITAL TRANSACTIONS: | |||||||||
Class II Shares | |||||||||
Proceeds from shares issued | $ | 43,285,749 | $ | 34,636,189 | |||||
Dividends reinvested | 2,479,342 | 114,666 | |||||||
Cost of shares redeemed | (1,631,366 | ) | (1,836,020 | ) | |||||
44,133,725 | 32,914,835 | ||||||||
Class VII Shares | |||||||||
Proceeds from shares issued | – | 1,000 | |||||||
Dividends reinvested | 37 | 27 | |||||||
37 | 1,027 | ||||||||
Change in net assets from capital transactions | $ | 44,133,762 | $ | 32,915,862 | |||||
SHARE TRANSACTIONS: | |||||||||
Class II Shares | |||||||||
Issued | 3,655,769 | 3,023,496 | |||||||
Reinvested | 216,536 | 10,377 | |||||||
Redeemed | (136,894 | ) | (159,893 | ) | |||||
3,735,411 | 2,873,980 | ||||||||
Class VII Shares | |||||||||
Issued | – | 88 | |||||||
Reinvested | 3 | 2 | |||||||
3 | 90 | ||||||||
Total change in shares | 3,735,414 | 2,874,070 | |||||||
(a) | For the period from May 1, 2006 (commencement of operations) through December 31, 2006. |
16
Distributions | ||||||||||||||||||||
Investment Activities | ||||||||||||||||||||
Net Realized | ||||||||||||||||||||
and | ||||||||||||||||||||
Net Asset | Unrealized | Total | ||||||||||||||||||
Value, | Net | Gains | from | Net | ||||||||||||||||
Beginning | Investment | (Losses) on | Investment | Investment | ||||||||||||||||
of Period | Income | Investments | Activities | Income | ||||||||||||||||
Class II Shares | ||||||||||||||||||||
Period ended December 31, 2006 (e) | $ | 11.45 | 0.38 | 0.21 | 0.59 | (0.14 | ) | |||||||||||||
For the six months ended June 30, 2007 (Unaudited) | $ | 11.72 | 0.41 | (0.26 | ) | 0.15 | (0.41 | ) | ||||||||||||
Class VII Shares | ||||||||||||||||||||
Period ended December 31, 2006 (e) | $ | 11.45 | 0.38 | 0.20 | 0.58 | (0.14 | ) | |||||||||||||
For the six months ended June 30, 2007 (Unaudited) | $ | 11.72 | 0.42 | (0.25 | ) | 0.17 | (0.41 | ) | ||||||||||||
[Additional columns below]
[Continued from above table, first column(s) repeated]
Distributions | ||||||||||||||||||||||||
Ratio of | ||||||||||||||||||||||||
Net Asset | Net Assets | Expenses | ||||||||||||||||||||||
Return of | Total | Value, End | Total | at End of | to Average | |||||||||||||||||||
capital | Distributions | of Period | Return (a) | Period (000s) | Net Assets (b) | |||||||||||||||||||
Class II Shares | ||||||||||||||||||||||||
Period ended December 31, 2006 (e) | (0.18 | ) | (0.32 | ) | $ | 11.72 | 5.30% | $ | 33,673 | 0.79% | ||||||||||||||
For the six months ended June 30, 2007 (Unaudited) | – | (0.41 | ) | $ | 11.46 | 1.29% | $ | 75,754 | 0.73% | |||||||||||||||
Class VII Shares | ||||||||||||||||||||||||
Period ended December 31, 2006 (e) | (0.17 | ) | (0.31 | ) | $ | 11.72 | 5.21% | $ | 1 | 1.13% | ||||||||||||||
For the six months ended June 30, 2007 (Unaudited) | – | (0.41 | ) | $ | 11.48 | 1.49% | $ | 1 | 0.34% | |||||||||||||||
[Additional columns below]
[Continued from above table, first column(s) repeated]
Ratios / Supplemental Data | ||||||||||||||||||
Ratio of Net | ||||||||||||||||||
Ratio of | Investment | |||||||||||||||||
Ratio of Net | Expenses | Income | ||||||||||||||||
Investment | (Prior to | (Prior to | ||||||||||||||||
Income | Reimbursements) | Reimbursements) | ||||||||||||||||
to Average | to Average | to Average | Portfolio | |||||||||||||||
Net Assets (b) | Net Assets (b)(c) | Net Assets (b)(c) | Turnover (d) | |||||||||||||||
Class II Shares | ||||||||||||||||||
Period ended December 31, 2006 (e) | 0.47% | 0.97% | 0.29% | 57.00% | ||||||||||||||
For the six months ended June 30, 2007 (Unaudited) | 9.45% | 0.88% | 8.80% | 23.00% | ||||||||||||||
Class VII Shares | ||||||||||||||||||
Period ended December 31, 2006 (e) | 4.83% | 1.38% | 4.57% | 57.00% | ||||||||||||||
For the six months ended June 30, 2007 (Unaudited) | 7.29% | 0.49% | 6.63% | 23.00% | ||||||||||||||
(a) | Not annualized for periods less than one year. | |
(b) | Annualized for periods less than one year. | |
(c) | During the period, certain fees were waived and/or reimbursed. If such waivers/reimbursements had not occurred, the ratios would have been as indicated. | |
(d) | Portfolio turnover is calculated on the basis of the respective Portfolio in which the Fund invests all of its investable assets. | |
(e) | For the period from May 1, 2006 (commencement of operations) through December 31, 2006. |
See accompanying notes to financial statements.
1. Organization
Nationwide Variable Insurance Trust (“NVIT” or the “Trust”) is an open-end management investment company, organized under the laws of Delaware by an amended and restated Agreement and Declaration of Trust, dated October 28, 2004, as amended to date. Prior to May 1, 2007, the Trust was named “Gartmore Variable Insurance Trust”. The Trust, originally created under the laws of Massachusetts as a Massachusetts business trust pursuant to a Declaration of Trust dated, as of June 30, 1981, and as subsequently amended, redomesticated as a Delaware Statutory Trust after the close of trading on April 29, 2005, and is registered under the Investment Company Act of 1940, as amended (the “1940 Act”). The redomestication was a change in statutory status and did not affect the operations of the Trust. As of June 30, 2007, the Trust had authorized an unlimited number of shares of beneficial interest, without par value (“shares”). The Trust currently offers shares to life insurance company separate accounts to fund the benefits under variable life insurance or annuity policies. To date, only the separate accounts of Nationwide Life Insurance Company and Nationwide Life and Annuity Insurance Company (collectively, “Nationwide”) have purchased shares of the American Funds NVIT Bond Fund (the “Fund”), (formerly, “American Funds GVIT Bond Fund”). The Trust currently operates forty (40) separate series, or mutual funds, each with its own investment objectives and strategies. This report contains the financial statements and financial highlights of the Fund.
The Fund operates as a “feeder fund” which means that the Fund does not buy individual securities directly. Instead, the Fund invests all of its assets in another mutual fund, the American Bond Fund (the “Master Fund”), a series of the American Funds Insurance Series® (“American Funds”), which invests directly in individual securities. The Fund, therefore, has the same investment objective and limitations as the Master Fund in which the Fund invests and the same gross investment returns as the Master Fund. The financial statements of the Master Fund’s portfolio, including the Statement of Investments, are included elsewhere in this report and should be read with the Fund’s financial statements. The percentage of the Master Fund’s portfolio owned by the Fund at June 30, 2007, was 1.74%.
2. Summary of Significant Accounting Policies
The following is a summary of significant accounting policies followed by the Fund in the preparation of its financial statements. The policies are in conformity with accounting principles generally accepted in the United States of America (“GAAP”). The preparation of financial statements requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of income and expenses for the period. Actual results could differ from those estimates.
(a) | Security Valuation |
The net asset value (“NAV”) per share of each class of the Fund is calculated by taking the market value of the Master Fund and other assets owned by the Fund, allocated to the class, subtracting the Fund’s liabilities attributable to that class, and dividing by the number of shares of that class that are outstanding. The Fund’s NAV is determined at the close of regular trading on the New York Stock Exchange (the “Exchange”) (usually 4 p.m. Eastern Time) (“Close of Trading”) on each day the Exchange is open for trading (“Business Day”). | |
The Master Fund calculates its NAV at the Close of Trading on each Business Day. Assets held by the Master Fund are valued primarily on the basis of market quotations. The Master Fund, however, has adopted procedures for making “fair value” determinations if market quotations are not readily available. For example, if events occur between the close of markets outside the United States and the close of regular trading on the New York Stock Exchange that, in the opinion of Capital Research and Management Company (“Capital Research”), the Master Fund’s investment adviser, materially affect the value of the portfolio securities of the Master Fund, the securities will be valued in accordance with the Master Fund’s fair value procedures. Use of these procedures is intended to result in more appropriate NAVs. In addition, such use will reduce, if not eliminate, potential arbitrage opportunities otherwise available to short-term investors in the Master Fund. |
(b) | Security Transactions and Investment Income |
Security transactions are accounted for on the date the security is purchased or sold (“trade date”). Securities gains and losses are calculated on the identified cost basis. Interest income is recognized on the accrual basis and includes, where applicable, the amortization or accretion of premium or discount. Dividend income is recorded on the ex-dividend date. |
(c) | Distributions to Shareholders |
The Fund’s dividends from net investment income, if any, are declared and paid quarterly. The Fund’s distributions from net realized capital gains, if any, are declared and distributed at least annually. | |
Dividends and distributions to shareholders are determined in accordance with federal income tax regulations, which may differ from GAAP. These “book/tax” differences are considered either permanent or temporary in nature. In accordance with the American Institute of Certified Public Accountants Statement of Position 93-2, permanent differences (i.e., reclassification of market discounts, foreign exchange gain/loss, paydowns, and distributions from real estate investment trusts) are reclassified within the capital accounts based on their nature for federal income tax purposes; temporary differences do not require reclassification. These reclassifications have no effect upon the net asset value of the Fund. To the extent distributions exceed current and accumulated earnings and profits for federal income tax purposes, these distributions are reported as distributions of paid-in-capital. |
(d) | Federal Income Taxes |
It is the policy of the Fund to qualify or to continue to qualify as a “regulated investment company” by complying with the provisions available to certain investment companies, as defined in Subchapter M of the U.S. Internal Revenue Code, and to make distributions of net investment income and net realized capital gains sufficient to relieve the Fund from all, or substantially all, federal income taxes. | |
As of June 30, 2007, the tax cost of securities and the breakdown of unrealized appreciation (depreciation) for the Fund was as follows: |
Tax Cost | Net Unrealized | |||||||||||||
of | Unrealized | Unrealized | Appreciation | |||||||||||
Securities | Appreciation | Depreciation | (Depreciation) | |||||||||||
$ | 76,900,940 | $ | — | $ | (1,218,251 | ) | $ | (1,218,251 | ) | |||||
(e) | Allocation of Expenses, Income, and Gains and Losses |
Expenses directly attributable to the Fund are charged to the Fund. Expenses not directly attributable to the Fund are allocated proportionately among various or all funds within the Trust. The method used by the Fund for allocating income, fund level expenses, and realized and unrealized gains or losses is based on the fair value of shares outstanding relative to net assets. Under this method, each class of shares participates based on the total net asset value of that class’s shares in proportion to the total net assets of the Fund. Expenses specific to a class (such as Rule 12b-1 and administrative services fees) are charged to that class. |
3. Transactions with Affiliates
Under the terms of the Master Fund’s Investment Advisory Agreement, Capital Research manages the investment of the assets and supervises the daily business affairs of the Master Fund. Nationwide Fund Management, LLC (prior to May 1, 2007, this service was provided by Gartmore SA Capital Trust (“GSA”)) (“NFM”), a wholly-owned subsidiary of NFS Distributors, Inc. (“NFSDI”), provides non-investment master-feeder operational support services to the Fund. Under the terms of the Trust’s Master-Feeder Services Agreement with NFM on behalf of the Fund, the Fund pays NFM a fee of 0.25% based on the Fund’s average daily net assets. NFM has entered into a contractual agreement with the Trust under
Under the terms of a Fund Administration and Transfer Agency Agreement, NFM provides the Fund with various administrative and accounting services for the Fund (prior to May 1, 2007, this service was provided by GSA), and serves as Transfer and Dividend Disbursing Agent for the Fund (prior to May 1, 2007, this service was provided by Gartmore Investor Services, Inc. (“GISI”), an indirect subsidiary of GSA). The fees for the services provided under this Agreement are calculated based on the Trust’s average daily net assets according to the fee schedule below. The fees are then allocated proportionately among all funds within the Trust in relation to the average daily net assets of each fund and are paid to NFA. NFA pays NFM from these fees for NFM’s services.
Combined Fee Schedule* | ||||||
Up to $1 billion | 0.15% | |||||
$1 billion up to $3 billion | 0.10% | |||||
$3 billion up to $8 billion | 0.05% | |||||
$8 billion up to $10 billion | 0.04% | |||||
$10 billion up to $12 billion | 0.02% | |||||
$12 billion or more | 0.01% | |||||
* | The assets of the Nationwide NVIT Investor Destinations Aggressive Fund, the Nationwide NVIT Investor Destinations Moderately Aggressive Fund, the Nationwide NVIT Investor Destinations Moderate Fund, the Nationwide NVIT Investor Destinations Moderately Conservative Fund, and the Nationwide NVIT Investor Destinations Conservative Fund (collectively, the “Investor Destinations Funds”) are excluded from the Trust asset level amount in order to calculate this asset-based fee. The Investor Destinations Funds do not pay any part of this fee. |
NFM has entered into agreements with Citi Fund Services Ohio, Inc. (“Citi”), pursuant to which Citi provides sub-administration and sub-transfer agency services, respectively, to the Fund. Effective August 1, 2007, The BISYS Group Inc. was acquired by and became a wholly owned subsidiary of Citi.
Under the terms of a Distribution Plan under Rule 12b-1 of the 1940 Act, Nationwide Fund Distributors, LLC. (formerly, “Gartmore Distribution Services, Inc. (“GDSI”)) (“NFD” or “Distributor”), the Fund’s principal underwriter, is compensated by the Fund for expenses associated with the distribution of the Class II and Class VII shares of the Fund. NFD is a wholly-owned subsidiary of NFSDI. These fees are based on average daily net assets of Class II and Class VII shares of the Fund at an annual rate not to exceed 0.25% of Class II shares and 0.40% of Class VII shares.
Under the terms of an Administrative Services Plan, the Fund may pay fees to servicing organizations, such as broker-dealers, including Nationwide Financial Services, Inc. (“NFS”), and financial institutions, which agree to provide administrative support services to the shareholders of certain classes. NFM is a wholly-owned subsidiary of NFS. These services include, but are not limited, to the following: establishing and maintaining shareholder accounts; processing purchase and redemption transactions; arranging bank wires; performing shareholder sub-accounting; answering inquires regarding the Fund; and other such services. These fees are based on an annual rate of up to 0.25% of the average daily net assets of each class of shares of the Fund.
For the six months ended June 30, 2007, NFS received $65,587 in Administrative Services Fees from the Fund.
Under the terms of a letter agreement dated September 12, 2006, by and among NFM, the Audit Committee of the Trust and the Trust, the Trust has agreed to reimburse NFM certain costs related to the Fund’s portion of ongoing administration, monitoring and annual (audit) testing of the Trust’s Rule 38a-1 Compliance Program subject to the pre-approval of the Trust’s Audit Committee. For the six months ended June 30, 2007, the Fund’s portion of such costs amounted to $325.
4. Bank Loans and Earnings Credit
The Trust has a credit agreement with JPMorgan Chase & Co., the Fund’s custodian bank, permitting the Trust to borrow up to $100,000,000. Borrowings under this arrangement bear interest at the Federal Funds rate plus 0.50%. The interest costs, if any, would be included in other fees in the Statement of Operations. No compensating balances were required under the terms of the line of credit. The line of credit is renewed annually, expiring on June 25, 2008, with a commitment fee of 0.07% per year on $100,000,000. There were no borrowings outstanding under this line of credit for the six months ended June 30, 2007.
The Trust’s custodian bank has agreed to reduce the bank’s fees (earnings credit) when the funds of the Trust maintain cash on deposit in non-interest-bearing custody and Demand Deposit Accounts. Earnings credits, if any, are shown as a reduction of total expenses on the Statement of Operations.
5. Indemnifications
Under the Trust’s organizational documents, certain of the Trust’s Officers and Trustees are indemnified against certain liabilities arising out of the performance of their duties to the Trust. In addition, the Trust has entered into Indemnification Agreements with the Trust’s trustees and certain officers covering similar liabilities. Trust Officers receive no compensation from the Trust for serving as the Trust’s Officers. In addition, in the normal course of business, the Trust enters into contracts with its vendors and others that provide for general indemnifications. The Trust’s maximum exposure under these arrangements is unknown, as this would involve future claims that may be made against the Trust. Based on experience, however, the Trust expects that risk of loss to be remote.
6. Recently Issued Accounting Pronouncements
On July 13, 2006, the Financial Accounting Standards Board (“FASB”) released FASB Interpretation No. 48, Accounting for Uncertainty in Income Taxes (“FIN 48”). FIN 48 provides guidance for how uncertain tax positions should be recognized, measured, presented and disclosed in the financial statements. FIN 48 requires the affirmative evaluation of tax positions taken or expected to be taken in the course of preparing the Fund’s tax returns to determine whether it is more-likely-than-not (i.e., greater than 50 percent) that each tax position will be sustained upon examination by a taxing authority based on the technical merits of the position. A tax position that meets the more-likely-than-not recognition threshold is measured to determine the amount of benefit to recognize in the financial statements. Differences between tax positions taken in a tax return and amounts recognized in the financial statements will generally result in an increase in a liability for taxes payable (or a reduction of a tax refund receivable) and an increase in a deferred tax liability (or a reduction in a deferred tax asset). Adoption of FIN 48 was required no later than the last business day of the first financial statement reporting period for fiscal years beginning after December 15, 2006 and is to be applied to all open tax years as of the effective date. Accordingly, the Fund was required to implement FIN 48 in its net asset value per share (NAV) calculation on June 29, 2007. Management has evaluated the implications of FIN 48 and has concluded that there was no impact to the Fund’s financial statements as of June 29, 2007. The adoption of FIN 48 requires ongoing monitoring and analysis, future conclusions reached by management may be different and result in adjustments to the Fund’s NAV and financial statements.
In September 2006, the FASB issued Statement on Financial Accounting Standards (“SFAS”) No. 157, “Fair Value Measurements.” This standard establishes a single authoritative definition of fair value, sets out a framework for measuring fair value and requires additional disclosures about fair value measurements. SFAS No. 157 applies to fair value measurements already required or permitted by existing standards. SFAS No. 157 is effective for financial statements issued for fiscal years beginning after November 15, 2007 and interim periods within those fiscal years. The changes to current accounting principles generally accepted in the United States of America from the application of this Statement relate to the definition of fair value, the methods used to measure fair value, and the expanded disclosures about fair value measurements. As of June 30, 2007, the Fund does not believe the adoption of SFAS No. 157 will impact the financial statement amounts; however, additional disclosures may be required about the inputs used to develop the measurements and the effect of certain of the measurements on changes in net assets for the period.
As a shareholder of the Fund, you incur two types of costs: (1) transaction costs, including sales charges (loads) paid on purchase payments and redemption fees; and (2) ongoing costs, including investment advisory fees, administration fees, distribution fees and other Fund expenses. The examples below are 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. Per SEC requirements, the examples assume that you had a $1,000 investment in the Class at the beginning of the reporting period, January 1, 2007, and continued to hold your shares at the end of the reporting period, June 30, 2007.
Actual Expenses
Hypothetical Example for Comparison Purposes
Please note that the expenses shown in the table are meant to highlight your ongoing costs only and do not reflect any transaction costs, such as sales charges (loads) or redemption fees. Therefore, the second line for each Class in 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 transaction costs were included, your costs would have been higher. The examples also assume all dividends and distributions have been reinvested.
Schedule of Shareholder Expenses
Beginning | Ending | |||||||||||||||||||||
Account Value | Account Value | Expenses Paid | Annualized | |||||||||||||||||||
American Funds NVIT Global Growth Fund | 1/1/07 | 06/30/07 | During Period* | Expense Ratio* | ||||||||||||||||||
Class II | Actual | $ | 1,000.00 | $ | 1,097.50 | $ | 4.32 | 0.83% | ||||||||||||||
Hypothetical | 1 | $ | 1,000.00 | $ | 1,020.68 | $ | 4.17 | 0.83% | ||||||||||||||
Class VII | Actual | $ | 1,000.00 | $ | 1,098.90 | $ | 2.91 | 0.56% | ||||||||||||||
Hypothetical | 1 | $ | 1,000.00 | $ | 1,021.28 | $ | 2.81 | 0.56% | ||||||||||||||
* | Expenses are equal to the Fund’s annualized expense ratio multiplied by the average account value over the period multiplied by 181/365 (to reflect the one-half year period). The expense ratio presented represents a six-month, annualized ratio in accordance with SEC guidelines. The expenses reported above do not include the effect of additional expenses imposed by variable annuity contracts. | |
1 | Represents the hypothetical 5% return before expenses. |
American Funds | ||||||
NVIT Global | ||||||
Growth Fund | ||||||
Assets: | ||||||
Investments in Master Fund (cost $66,319,169) | $ | 71,042,828 | ||||
Receivable for capital shares issued | 140,674 | |||||
Prepaid expenses | 678 | |||||
Total Assets | 71,184,180 | |||||
Liabilities: | ||||||
Payable for capital shares redeemed | 3,208 | |||||
Accrued expenses and other payables: | ||||||
Fund administration and transfer agent fees | 3,442 | |||||
Master feeder service provider fee | 5,675 | |||||
Distribution fees | 14,188 | |||||
Administrative servicing fees | 22,298 | |||||
Compliance program costs | 550 | |||||
Other | 38,533 | |||||
Total Liabilities | 87,894 | |||||
Net Assets | $ | 71,096,286 | ||||
Represented by: | ||||||
Capital | $ | 62,891,393 | ||||
Accumulated net investment loss | (14,357 | ) | ||||
Accumulated net realized gains from investment transactions and distributions from Master Fund | 3,495,591 | |||||
Net unrealized appreciation on investments | 4,723,659 | |||||
Net Assets | $ | 71,096,286 | ||||
Net Assets: | ||||||
Class II Shares | $ | 71,095,094 | ||||
Class VII Shares | 1,192 | |||||
Total | $ | 71,096,286 | ||||
Shares outstanding (unlimited number of shares authorized): | ||||||
Class II Shares | 2,803,509 | |||||
Class VII Shares | 47 | |||||
Total | 2,803,556 | |||||
Net asset value and offering price per share (Net assets by class divided by shares outstanding by class, respectively.): | ||||||
Class II Shares | $ | 25.36 | ||||
Class VII Shares | $ | 25.39 | (a) | |||
(a) | The NAV reported above represents the traded NAV at June 30, 2007. Due to the financial statement rounding of class assets and class shares above, the NAV results in a different NAV than the traded NAV. |
23
American Funds | |||||
NVIT Global | |||||
Growth Fund | |||||
INVESTMENT INCOME: | |||||
Dividend income | $ | 944,550 | |||
Total Income | 944,550 | ||||
Expenses: | |||||
Fund administration and transfer agent fees | 17,157 | ||||
Master feeder service provider fee | 71,970 | ||||
Distribution fees Class II Shares | 71,970 | ||||
Distribution fees Class VII Shares | 2 | ||||
Administrative servicing fees Class II Shares | 83,467 | ||||
Trustee fees | 1,038 | ||||
Compliance program costs (Note 3) | 407 | ||||
Printing fees | 33,322 | ||||
Other | 1,499 | ||||
Total expenses before reimbursements | 280,832 | ||||
Expenses waived for Master feeder service provider fee | (43,182 | ) | |||
Net Expenses | 237,650 | ||||
Net Investment Income | 706,900 | ||||
REALIZED/ UNREALIZED GAINS (LOSSES) FROM INVESTMENTS: | |||||
Net realized gains on investment transactions | 743,656 | ||||
Net realized gain distributions from Master Fund | 2,755,601 | ||||
Net realized gains on investment transactions and distributions from Master Fund | 3,499,257 | ||||
Net change in unrealized appreciation on investments | 1,239,222 | ||||
Net realized/unrealized gains (losses) on investments | 4,738,479 | ||||
CHANGE IN NET ASSETS RESULTING FROM OPERATIONS | $ | 5,445,379 | |||
24
American Funds NVIT | |||||||||
Global Growth Fund | |||||||||
Six Months Ended | Year Ended | ||||||||
June 30, | December 31, | ||||||||
2007 | 2006(a) | ||||||||
(Unaudited) | |||||||||
From Investment Activities: | |||||||||
Operations: | |||||||||
Net investment income (loss) | $ | 706,900 | $ | (78,346 | ) | ||||
Net realized gains on investment transactions and distributions from Master Fund | 3,499,257 | 346 | |||||||
Net change in unrealized appreciation on investments | 1,239,222 | 3,484,437 | |||||||
Change in net assets resulting from operations | 5,445,379 | 3,406,437 | |||||||
Distributions to shareholders from: | |||||||||
Net investment income: | |||||||||
Class II | (721,244 | ) | – | ||||||
Class VII | (13 | ) | – | ||||||
Tax return of capital: | |||||||||
Class II | – | (30,000 | ) | ||||||
Class VII | – | (7 | ) | ||||||
Change in net assets from shareholder distributions | (721,257 | ) | (30,007 | ) | |||||
Change in net assets from capital transactions | 20,379,251 | 42,616,483 | |||||||
Change in net assets | 25,103,373 | 45,992,913 | |||||||
Net Assets: | |||||||||
Beginning of period | 45,992,913 | – | |||||||
End of period | $ | 71,096,286 | $ | 45,992,913 | |||||
Accumulated net investment income (loss) at end of period | $ | (14,357 | ) | $ | – | ||||
CAPITAL TRANSACTIONS: | |||||||||
Class II Shares | |||||||||
Proceeds from shares issued | $ | 26,557,207 | $ | 43,418,062 | |||||
Dividends reinvested | 721,241 | 30,000 | |||||||
Cost of shares redeemed | (6,899,210 | ) | (832,586 | ) | |||||
20,379,238 | 42,615,476 | ||||||||
Class VII Shares | |||||||||
Proceeds from shares issued | – | 1,000 | |||||||
Dividends reinvested | 13 | 7 | |||||||
13 | 1,007 | ||||||||
Change in net assets from capital transactions | $ | 20,379,251 | $ | 42,616,483 | |||||
SHARE TRANSACTIONS: | |||||||||
Class II Shares | |||||||||
Issued | 1,090,776 | 2,006,586 | |||||||
Reinvested | 28,621 | 1,493 | |||||||
Redeemed | (285,824 | ) | (38,143 | ) | |||||
833,573 | 1,969,936 | ||||||||
Class VII Shares | |||||||||
Issued | – | 46 | |||||||
Reinvested | 1 | – | (b) | ||||||
1 | 46 | ||||||||
Total change in shares | 833,574 | 1,969,982 | |||||||
(a) | For the period from May 1, 2006 (commencement of operations) through December 31, 2006. | |
(b) | Amount is less than 1 share. |
25
Investment Activities | Distributions | |||||||||||||||||||
Net Realized | ||||||||||||||||||||
Net Asset | and | Total | ||||||||||||||||||
Value, | Net | Unrealized | from | Net | ||||||||||||||||
Beginning | Investment | Gains on | Investment | Investment | ||||||||||||||||
of Period | Income | Investments | Activities | Income | ||||||||||||||||
Class II Shares | ||||||||||||||||||||
Period ended December 31, 2006 (e) | $ | 21.69 | 0.10 | 1.72 | 1.82 | – | ||||||||||||||
For the six months ended June 30, 2007 (Unaudited) | $ | 23.35 | 0.25 | 2.02 | 2.27 | (0.26 | ) | |||||||||||||
Class VII Shares | ||||||||||||||||||||
Period ended December 31, 2006 (e) | $ | 21.69 | 0.06 | 1.75 | 1.81 | – | ||||||||||||||
For the six months ended June 30, 2007 (Unaudited) | $ | 23.35 | 0.28 | 2.04 | 2.32 | (0.28 | ) | |||||||||||||
[Additional columns below]
[Continued from above table, first column(s) repeated]
Distributions | ||||||||||||||||||||
Net Asset | Net Assets | |||||||||||||||||||
Return | Value, | at End of | ||||||||||||||||||
of | Total | End | Total | Period | ||||||||||||||||
capital | Distributions | of Period | Return (a) | (000s) | ||||||||||||||||
Class II Shares | ||||||||||||||||||||
Period ended December 31, 2006 (e) | (0.16 | ) | (0.16 | ) | $ | 23.35 | 8.52% | $ | 45,992 | |||||||||||
For the six months ended June 30, 2007 (Unaudited) | – | (0.26 | ) | $ | 25.36 | 9.75% | $ | 71,095 | ||||||||||||
Class VII Shares | ||||||||||||||||||||
Period ended December 31, 2006 (e) | (0.15 | ) | (0.15 | ) | $ | 23.35 | 8.48% | $ | 1 | |||||||||||
For the six months ended June 30, 2007 (Unaudited) | – | (0.28 | ) | $ | 25.39 | 9.89% | $ | 1 | ||||||||||||
[Additional columns below]
[Continued from above table, first column(s) repeated]
Ratios / Supplemental Data | ||||||||||||||||||||||
Ratio of Net | Ratio of | |||||||||||||||||||||
Investment | Ratio of | Investment | ||||||||||||||||||||
Ratio of | Income | Expenses | Income (Loss) | |||||||||||||||||||
Expenses | (Loss) to | (Prior to | (Prior to | |||||||||||||||||||
to Average | Average | Reimbursements) | Reimbursements) | |||||||||||||||||||
Net | Net | to Average | to Average | Portfolio | ||||||||||||||||||
Assets (b) | Assets (b) | Net Assets (b)(c) | Net Assets (b)(c) | Turnover (d) | ||||||||||||||||||
Class II Shares | ||||||||||||||||||||||
Period ended December 31, 2006 (e) | 0.91% | (0.63%) | 1.16% | (0.87%) | 31.00% | |||||||||||||||||
For the six months ended June 30, 2007 (Unaudited) | 0.83% | 2.45% | 0.98% | 2.30% | 18.00% | |||||||||||||||||
Class VII Shares | ||||||||||||||||||||||
Period ended December 31, 2006 (e) | 1.11% | 0.40% | 1.21% | 0.29% | 31.00% | |||||||||||||||||
For the six months ended June 30, 2007 (Unaudited) | 0.56% | 2.33% | 0.71% | 2.18% | 18.00% | |||||||||||||||||
(a) | Not annualized for periods less than one year. | |
(b) | Annualized for periods less than one year. | |
(c) | During the period, certain fees were waived and/or reimbursed. If such waivers/reimbursements had not occurred, the ratios would have been as indicated. | |
(d) | Portfolio turnover is calculated on the basis of the respective Portfolio in which the Fund invests all of its investable assets. | |
(e) | For the period from May 1, 2006 (commencement of operations) through December 31, 2006. |
See accompanying notes to financial statements.
1. Organization
Nationwide Variable Insurance Trust (“NVIT” or the “Trust”) is an open-end management investment company, organized under the laws of Delaware by an amended and restated Agreement and Declaration of Trust, dated October 28, 2004, as amended to date. Prior to May 1, 2007, the Trust was named “Gartmore Variable Insurance Trust”. The Trust, originally created under the laws of Massachusetts as a Massachusetts business trust pursuant to a Declaration of Trust dated, as of June 30, 1981, and as subsequently amended, redomesticated as a Delaware Statutory Trust after the close of trading on April 29, 2005, and is registered under the Investment Company Act of 1940, as amended (the “1940 Act”). The redomestication was a change in statutory status and did not affect the operations of the Trust. As of June 30, 2007, the Trust had authorized an unlimited number of shares of beneficial interest, without par value (“shares”). The Trust currently offers shares to life insurance company separate accounts to fund the benefits under variable life insurance or annuity policies. To date, only the separate accounts of Nationwide Life Insurance Company and Nationwide Life and Annuity Insurance Company (collectively, “Nationwide”) have purchased shares of the American Funds NVIT Global Growth Fund (the “Fund”), (formerly, “American Funds GVIT Global Growth Fund”). The Trust currently operates forty (40) separate series, or mutual funds, each with its own investment objectives and strategies. This report contains the financial statements and financial highlights of the Fund.
The Fund operates as a “feeder fund” which means that the Fund does not buy individual securities directly. Instead, the Fund invests all of its assets in another mutual fund, the American Global Growth Fund (the “Master Fund”), a series of the American Funds Insurance Series® (“American Funds”), which invests directly in individual securities. The Fund, therefore, has the same investment objective and limitations as the Master Fund in which the Fund invests and the same gross investment returns as the Master Fund. The financial statements of the Master Fund’s portfolio, including the Statement of Investments, are included elsewhere in this report and should be read with the Fund’s financial statements. The percentage of the Master Fund’s portfolio owned by the Fund at June 30, 2007, was 1.40%.
2. Summary of Significant Accounting Policies
The following is a summary of significant accounting policies followed by the Fund in the preparation of its financial statements. The policies are in conformity with accounting principles generally accepted in the United States of America (“GAAP”). The preparation of financial statements requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of income and expenses for the period. Actual results could differ from those estimates.
(a) | Security Valuation |
The net asset value (“NAV”) per share of each class of the Fund is calculated by taking the market value of the Master Fund and other assets owned by the Fund, allocated to the class, subtracting the Fund’s liabilities attributable to that class, and dividing by the number of shares of that class that are outstanding. The Fund’s NAV is determined at the close of regular trading on the New York Stock Exchange (the “Exchange”) (usually 4 p.m. Eastern Time) (“Close of Trading”) on each day the Exchange is open for trading (“Business Day”). | |
The Master Fund calculates its NAV at the Close of Trading on each Business Day. Assets held by the Master Fund are valued primarily on the basis of market quotations. The Master Fund, however, has adopted procedures for making “fair value” determinations if market quotations are not readily available. For example, if events occur between the close of markets outside the United States and the close of regular trading on the New York Stock Exchange that, in the opinion of Capital Research and Management Company (“Capital Research”), the Master Fund’s investment adviser, materially affect the value of the portfolio securities of the Master Fund, the securities will be valued in accordance with the Master Fund’s fair value procedures. Use of these procedures is intended to result in more appropriate NAVs. In addition, such use will reduce, if not eliminate, potential arbitrage opportunities otherwise available to short-term investors in the Master Fund. |
(b) | Security Transactions and Investment Income |
Security transactions are accounted for on the date the security is purchased or sold (“trade date”). Securities gains and losses are calculated on the identified cost basis. Interest income is recognized on the accrual basis and includes, where applicable, the amortization or accretion of premium or discount. Dividend income is recorded on the ex-dividend date. |
(c) | Distributions to Shareholders |
The Fund’s dividends from net investment income, if any, are declared and paid quarterly. The Fund’s distributions from net realized capital gains, if any, are declared and distributed at least annually. | |
Dividends and distributions to shareholders are determined in accordance with federal income tax regulations, which may differ from GAAP. These “book/tax” differences are considered either permanent or temporary in nature. In accordance with the American Institute of Certified Public Accountants Statement of Position 93-2, permanent differences (i.e., reclassification of market discounts, foreign exchange gain/loss, paydowns, and distributions from real estate investment trusts) are reclassified within the capital accounts based on their nature for federal income tax purposes; temporary differences do not require reclassification. These reclassifications have no effect upon the net asset value of the Fund. To the extent distributions exceed current and accumulated earnings and profits for federal income tax purposes, these distributions are reported as distributions of paid-in-capital. |
(d) | Federal Income Taxes |
It is the policy of the Fund to qualify or to continue to qualify as a “regulated investment company” by complying with the provisions available to certain investment companies, as defined in Subchapter M of the U.S. Internal Revenue Code, and to make distributions of net investment income and net realized capital gains sufficient to relieve the Fund from all, or substantially all, federal income taxes. | |
As of June 30, 2007, the tax cost of securities and the breakdown of unrealized appreciation (depreciation) for the Fund was as follows: |
Net Unrealized | ||||||||||||||
Tax Cost of | Unrealized | Unrealized | Appreciation | |||||||||||
Securities | Appreciation | Depreciation | (Depreciation) | |||||||||||
$ | 66,322,835 | $ | 4,719,993 | $ | — | $ | 4,719,993 | |||||||
(e) | Allocation of Expenses, Income, and Gains and Losses |
Expenses directly attributable to the Fund are charged to the Fund. Expenses not directly attributable to the Fund are allocated proportionately among various or all funds within the Trust. The method used by the Fund for allocating income, fund level expenses, and realized and unrealized gains or losses is based on the fair value of shares outstanding relative to net assets. Under this method, each class of shares participates based on the total net asset value of that class’s shares in proportion to the total net assets of the Fund. Expenses specific to a class (such as Rule 12b-1 and administrative services fees) are charged to that class. |
3. Transactions with Affiliates
Under the terms of the Master Fund’s Investment Advisory Agreement, Capital Research manages the investment of the assets and supervises the daily business affairs of the Master Fund. Nationwide Fund Management, LLC (prior to May 1, 2007, this service was provided by Gartmore SA Capital Trust (“GSA”)) (“NFM”), a wholly-owned subsidiary of NFS Distributors, Inc. (“NFSDI”), provides non-investment master-feeder operational support services to the Fund. Under the terms of the Trust’s Master-Feeder Services Agreement with NFM on behalf of the Fund, the Fund pays NFM a fee of 0.25% based on the Fund’s average daily net assets. NFM has entered into a contractual agreement with the Trust under
Under the terms of a Fund Administration and Transfer Agency Agreement, NFM provides the Fund with various administrative and accounting services for the Fund (prior to May 1, 2007, this service was provided by GSA), and serves as Transfer and Dividend Disbursing Agent for the Fund (prior to May 1, 2007, this service was provided by Gartmore Investor Services, Inc. (“GISI”), an indirect subsidiary of GSA). The fees for the services provided under this Agreement are calculated based on the Trust’s average daily net assets according to the fee schedule below. The fees are then allocated proportionately among all funds within the Trust in relation to the average daily net assets of each fund and are paid to NFA. NFA pays NFM from these fees for NFM’s services.
Combined Fee Schedule* | ||||||
Up to $1 billion | 0.15% | |||||
$1 billion up to $3 billion | 0.10% | |||||
$3 billion up to $8 billion | 0.05% | |||||
$8 billion up to $10 billion | 0.04% | |||||
$10 billion up to $12 billion | 0.02% | |||||
$12 billion or more | 0.01% | |||||
* | The assets of the Nationwide NVIT Investor Destinations Aggressive Fund, the Nationwide NVIT Investor Destinations Moderately Aggressive Fund, the Nationwide NVIT Investor Destinations Moderate Fund, the Nationwide NVIT Investor Destinations Moderately Conservative Fund, and the Nationwide NVIT Investor Destinations Conservative Fund (collectively, the “Investor Destinations Funds”) are excluded from the Trust asset level amount in order to calculate this asset-based fee. The Investor Destinations Funds do not pay any part of this fee. |
NFM has entered into agreements with Citi Fund Services Ohio, Inc. (“Citi”), pursuant to which Citi provides sub-administration and sub-transfer agency services, respectively, to the Fund. Effective August 1, 2007, The BISYS Group Inc. was acquired by and became a wholly owned subsidiary of Citi.
Under the terms of a Distribution Plan under Rule 12b-1 of the 1940 Act, Nationwide Fund Distributors, LLC. (formerly, “Gartmore Distribution Services, Inc. (“GDSI”)) (“NFD” or “Distributor”), the Fund’s principal underwriter, is compensated by the Fund for expenses associated with the distribution of the Class II and Class VII shares of the Fund. NFD is a wholly-owned subsidiary of NFSDI. These fees are based on average daily net assets of Class II and Class VII shares of the Fund at an annual rate not to exceed 0.25% of Class II shares and 0.40% of Class VII shares.
Under the terms of an Administrative Services Plan, the Fund may pay fees to servicing organizations, such as broker-dealers, including Nationwide Financial Services, Inc. (“NFS”), and financial institutions, which agree to provide administrative support services to the shareholders of certain classes. NFM is a wholly-owned subsidiary of NFS. These services include, but are not limited, to the following: establishing and maintaining shareholder accounts; processing purchase and redemption transactions; arranging bank wires; performing shareholder sub-accounting; answering inquires regarding the Fund; and other such services. These fees are based on an annual rate of up to 0.25% of the average daily net assets of each class of shares of the Fund.
For the six months ended June 30, 2007, NFS received $72,181 in Administrative Services Fees from the Fund.
Under the terms of a letter agreement dated September 12, 2006, by and among NFM, the Audit Committee of the Trust and the Trust, the Trust has agreed to reimburse NFM certain costs related to the Fund’s portion of ongoing administration, monitoring and annual (audit) testing of the Trust’s Rule 38a-1 Compliance Program subject to the pre-approval of the Trust’s Audit Committee. For the six months ended June 30, 2007, the Fund’s portion of such costs amounted to $407.
4. Bank Loans and Earnings Credit
The Trust has a credit agreement with JPMorgan Chase & Co., the Fund’s custodian bank, permitting the Trust to borrow up to $100,000,000. Borrowings under this arrangement bear interest at the Federal Funds rate plus 0.50%. The interest costs, if any, would be included in other fees in the Statement of Operations. No compensating balances were required under the terms of the line of credit. The line of credit is renewed annually, expiring on June 25, 2008, with a commitment fee of 0.07% per year on $100,000,000. There were no borrowings outstanding under this line of credit for the six months ended June 30, 2007.
The Trust’s custodian bank has agreed to reduce the bank’s fees (earnings credit) when the funds of the Trust maintain cash on deposit in non-interest-bearing custody and Demand Deposit Accounts. Earnings credits, if any, are shown as a reduction of total expenses on the Statement of Operations.
5. Indemnifications
Under the Trust’s organizational documents, certain of the Trust’s Officers and Trustees are indemnified against certain liabilities arising out of the performance of their duties to the Trust. In addition, the Trust has entered into Indemnification Agreements with the Trust’s trustees and certain officers covering similar liabilities. Trust Officers receive no compensation from the Trust for serving as the Trust’s Officers. In addition, in the normal course of business, the Trust enters into contracts with its vendors and others that provide for general indemnifications. The Trust’s maximum exposure under these arrangements is unknown, as this would involve future claims that may be made against the Trust. Based on experience, however, the Trust expects that risk of loss to be remote.
6. Recently Issued Accounting Pronouncements
On July 13, 2006, the Financial Accounting Standards Board (“FASB”) released FASB Interpretation No. 48, Accounting for Uncertainty in Income Taxes (“FIN 48”). FIN 48 provides guidance for how uncertain tax positions should be recognized, measured, presented and disclosed in the financial statements. FIN 48 requires the affirmative evaluation of tax positions taken or expected to be taken in the course of preparing the Fund’s tax returns to determine whether it is more-likely-than-not (i.e., greater than 50 percent) that each tax position will be sustained upon examination by a taxing authority based on the technical merits of the position. A tax position that meets the more-likely-than-not recognition threshold is measured to determine the amount of benefit to recognize in the financial statements. Differences between tax positions taken in a tax return and amounts recognized in the financial statements will generally result in an increase in a liability for taxes payable (or a reduction of a tax refund receivable) and an increase in a deferred tax liability (or a reduction in a deferred tax asset). Adoption of FIN 48 was required no later than the last business day of the first financial statement reporting period for fiscal years beginning after December 15, 2006 and is to be applied to all open tax years as of the effective date. Accordingly, the Fund was required to implement FIN 48 in its net asset value per share (NAV) calculation on June 29, 2007. Management has evaluated the implications of FIN 48 and has concluded that there was no impact to the Fund’s financial statements as of June 29, 2007. The adoption of FIN 48 requires ongoing monitoring and analysis, future conclusions reached by management may be different and result in adjustments to the Fund’s NAV and financial statements.
In September 2006, the FASB issued Statement on Financial Accounting Standards (“SFAS”) No. 157, “Fair Value Measurements.” This standard establishes a single authoritative definition of fair value, sets out a framework for measuring fair value and requires additional disclosures about fair value measurements. SFAS No. 157 applies to fair value measurements already required or permitted by existing standards. SFAS No. 157 is effective for financial statements issued for fiscal years beginning after November 15, 2007 and interim periods within those fiscal years. The changes to current accounting principles generally accepted in the United States of America from the application of this Statement relate to the definition of fair value, the methods used to measure fair value, and the expanded disclosures about fair value measurements. As of June 30, 2007, the Fund does not believe the adoption of SFAS No. 157 will impact the financial statement amounts; however, additional disclosures may be required about the inputs used to develop the measurements and the effect of certain of the measurements on changes in net assets for the period.
As a shareholder of the Fund, you incur two types of costs: (1) transaction costs, including sales charges (loads) paid on purchase payments and redemption fees; and (2) ongoing costs, including investment advisory fees, administration fees, distribution fees and other Fund expenses. The examples below are 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. Per SEC requirements, the examples assume that you had a $1,000 investment in the Class at the beginning of the reporting period, January 1, 2007, and continued to hold your shares at the end of the reporting period, June 30, 2007.
Actual Expenses
Hypothetical Example for Comparison Purposes
Please note that the expenses shown in the table are meant to highlight your ongoing costs only and do not reflect any transaction costs, such as sales charges (loads) or redemption fees. Therefore, the second line for each Class in 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 transaction costs were included, your costs would have been higher. The examples also assume all dividends and distributions have been reinvested.
Schedule of Shareholder Expenses
Beginning | Ending | |||||||||||||||||||||
Account Value | Account Value | Expenses Paid | Annualized | |||||||||||||||||||
American Funds NVIT Growth Fund | 1/1/07 | 06/30/07 | During Period* | Expense Ratio* | ||||||||||||||||||
Class II | Actual | $ | 1,000.00 | $ | 1,103.40 | $ | 3.81 | 0.73% | ||||||||||||||
Hypothetical | 1 | $ | 1,000.00 | $ | 1,021.18 | $ | 3.66 | 0.73% | ||||||||||||||
Class VII | Actual | $ | 1,000.00 | $ | 1,105.20 | $ | 1.98 | 0.38% | ||||||||||||||
Hypothetical | 1 | $ | 1,000.00 | $ | 1,023.11 | $ | 1.91 | 0.38% | ||||||||||||||
* | Expenses are equal to the Fund’s annualized expense ratio multiplied by the average account value over the period multiplied by 181/365 (to reflect the one-half year period). The expense ratio presented represents a six-month, annualized ratio in accordance with SEC guidelines. The expenses reported above do not include the effect of additional expenses imposed by variable annuity contracts. | |
1 | Represents the hypothetical 5% return before expenses. |
American Funds | ||||||
NVIT | ||||||
Growth Fund | ||||||
Assets: | ||||||
Investments in Master Fund (cost $125,131,860) | $ | 130,708,795 | ||||
Receivable for capital shares issued | 139,946 | |||||
Prepaid expenses | 1,164 | |||||
Total Assets | 130,849,905 | |||||
Liabilities: | ||||||
Payable for capital shares redeemed | 7,483 | |||||
Accrued expenses and other payables: | ||||||
Fund administration and transfer agent fees | 6,765 | |||||
Master feeder service provider fee | 10,479 | |||||
Distribution fees | 26,199 | |||||
Administrative servicing fees | 35,441 | |||||
Compliance program costs | 920 | |||||
Other | 9,722 | |||||
Total Liabilities | 97,009 | |||||
Net Assets | $ | 130,752,896 | ||||
Represented by: | ||||||
Capital | $ | 116,822,275 | ||||
Accumulated net investment loss | (112,396 | ) | ||||
Accumulated net realized gains from investment transactions and distributions from Master Fund | 8,466,082 | |||||
Net unrealized appreciation on investments | 5,576,935 | |||||
Net Assets | $ | 130,752,896 | ||||
Net Assets: | ||||||
Class II Shares | $ | 130,751,751 | ||||
Class VII Shares | 1,145 | |||||
Total | $ | 130,752,896 | ||||
Shares outstanding (unlimited number of shares authorized): | ||||||
Class II Shares | 1,828,744 | |||||
Class VII Shares | 16 | |||||
Total | 1,828,760 | |||||
Net asset value and offering price per share (Net assets by class divided by shares outstanding by class, respectively.): | ||||||
Class II Shares | $ | 71.50 | ||||
Class VII Shares | $ | 71.76 | (a) | |||
(a) | The NAV reported above represents the traded NAV at June 30, 2007. Due to the financial statement rounding of class assets and class shares above, the NAV results in a different NAV than the traded NAV. |
32
American Funds | ||||||
NVIT Growth | ||||||
Fund | ||||||
INVESTMENT INCOME: | ||||||
Dividend income | $ | 254,116 | ||||
Total Income | 254,116 | |||||
Expenses: | ||||||
Fund administration and transfer agent fees | 30,258 | |||||
Master feeder service provider fee | 126,558 | |||||
Distribution fees Class II Shares | 126,558 | |||||
Distribution fees Class VII Shares | 2 | |||||
Administrative servicing fees Class II Shares | 139,423 | |||||
Custodian fees | 178 | |||||
Trustee fees | 1,911 | |||||
Compliance program costs (Note 3) | 660 | |||||
Other | 20,430 | |||||
Total expenses before earnings credit | 445,978 | |||||
Expenses waived for Master feeder service provider fee | (75,935 | ) | ||||
Earnings credit (Note 4) | (89 | ) | ||||
Net Expenses | 369,954 | |||||
Net Investment Loss | (115,838 | ) | ||||
REALIZED/ UNREALIZED GAINS (LOSSES) FROM INVESTMENTS: | ||||||
Net realized gains on investment transactions | 47,360 | |||||
Net realized gain distributions from Master Fund | 8,469,900 | |||||
Net realized gains on investment transactions and distributions from Master Fund | 8,517,260 | |||||
Net change in unrealized appreciation on investments | 2,022,378 | |||||
Net realized/unrealized gains (losses) on investments | 10,539,638 | |||||
CHANGE IN NET ASSETS RESULTING FROM OPERATIONS | $ | 10,423,800 | ||||
33
American Funds NVIT Growth Fund | |||||||||
Six Months Ended | Year Ended | ||||||||
June 30, | December 31, | ||||||||
2007 | 2006(a) | ||||||||
(Unaudited) | |||||||||
FROM INVESTMENT ACTIVITIES: | |||||||||
Operations: | |||||||||
Net investment income (loss) | $ | (115,838 | ) | $ | 429,262 | ||||
Net realized gains (losses) on investment transactions and distributions from Master Fund | 8,517,260 | (13,161 | ) | ||||||
Net change in unrealized appreciation on investments | 2,022,378 | 3,554,557 | |||||||
Change in net assets resulting from operations | 10,423,800 | 3,970,658 | |||||||
Distributions to shareholders from: | |||||||||
Net investment income: | |||||||||
Class II | – | (435,217 | ) | ||||||
Class VII | – | (4 | ) | ||||||
Net realized gains: | |||||||||
Class II | (38,017 | ) | – | ||||||
Change in net assets from shareholder distributions | (38,017 | ) | (435,221 | ) | |||||
Change in net assets from capital transactions | 45,561,650 | 71,270,026 | |||||||
Change in net assets | 55,947,433 | 74,805,463 | |||||||
Net Assets: | |||||||||
Beginning of period | 74,805,463 | – | |||||||
End of period | $ | 130,752,896 | $ | 74,805,463 | |||||
Accumulated net investment income (loss) at end of period | $ | (112,396 | ) | $ | 3,442 | ||||
CAPITAL TRANSACTIONS: | |||||||||
Class II Shares | |||||||||
Proceeds from shares issued | $ | 48,175,557 | $ | 72,386,539 | |||||
Dividends reinvested | 38,015 | 435,217 | |||||||
Cost of shares redeemed | (2,651,922 | ) | (1,552,734 | ) | |||||
45,561,650 | 71,269,022 | ||||||||
Class VII Shares | |||||||||
Proceeds from shares issued | – | 1,000 | |||||||
Dividends reinvested | – | 4 | |||||||
– | 1,004 | ||||||||
Change in net assets from capital transactions | $ | 45,561,650 | $ | 71,270,026 | |||||
SHARE TRANSACTIONS: | |||||||||
Class II Shares | |||||||||
Issued | 712,851 | 1,172,886 | |||||||
Reinvested | 533 | 6,687 | |||||||
Redeemed | (38,656 | ) | (25,557 | ) | |||||
674,728 | 1,154,016 | ||||||||
Class VII Shares | |||||||||
Issued | – | 16 | |||||||
Reinvested | – | – | (b) | ||||||
– | 16 | ||||||||
Total change in shares | 674,728 | 1,154,032 | |||||||
(a) | For the period from May 1, 2006 (commencement of operations) through December 31, 2006. | |
(b) | Amount is less than 1 share. |
34
Investment Activities | ||||||||||||||||
Net Realized | ||||||||||||||||
Net Asset | Net | and | Total | |||||||||||||
Value, | Investment | Unrealized | from | |||||||||||||
Beginning | Income | Gains on | Investment | |||||||||||||
of Period | (Loss) | Investments | Activities | |||||||||||||
Class II Shares | ||||||||||||||||
Period ended December 31, 2006 (e) | $ | 62.91 | 0.39 | 1.92 | 2.31 | |||||||||||
For the six months ended June 30, 2007 (Unaudited) | $ | 64.82 | (0.06 | ) | 6.76 | 6.70 | ||||||||||
Class VII Shares | ||||||||||||||||
Period ended December 31, 2006 (e) | $ | 62.91 | 0.60 | 1.66 | 2.26 | |||||||||||
For the six months ended June 30, 2007 (Unaudited) | $ | 64.93 | 0.03 | 6.82 | 6.85 | |||||||||||
[Additional columns below]
[Continued from above table, first column(s) repeated]
Distributions | ||||||||||||||||||||
Net | Net | Net Asset | ||||||||||||||||||
Investment | Realized | Total | Value, End | Total | ||||||||||||||||
Income | Gains | Distributions | of Period | Return (a) | ||||||||||||||||
Class II Shares | ||||||||||||||||||||
Period ended December 31, 2006 (e) | (0.40 | ) | – | (0.40 | ) | $ | 64.82 | 3.68% | ||||||||||||
For the six months ended June 30, 2007 (Unaudited) | – | (0.02 | ) | (0.02 | ) | $ | 71.50 | 10.34% | ||||||||||||
Class VII Shares | ||||||||||||||||||||
Period ended December 31, 2006 (e) | (0.24 | ) | – | (0.24 | ) | $ | 64.93 | 3.63% | ||||||||||||
For the six months ended June 30, 2007 (Unaudited) | – | (0.02 | ) | (0.02 | ) | $ | 71.76 | 10.52% | ||||||||||||
[Additional columns below]
[Continued from above table, first column(s) repeated]
Ratios / Supplemental Data | ||||||||||||||||||||||||||
Ratio of | ||||||||||||||||||||||||||
Ratio of | Ratio of | Investment | ||||||||||||||||||||||||
Net | Expenses | Income (Loss) | ||||||||||||||||||||||||
Net Assets | Ratio of | Investment | (Prior to | (Prior to | ||||||||||||||||||||||
at End of | Expenses | Income (Loss) | Reimbursements) | Reimbursements) | ||||||||||||||||||||||
Period | to Average | to Average | to Average | to Average | Portfolio | |||||||||||||||||||||
(000s) | Net Assets (b) | Net Assets (b) | Net Assets (b)(c) | Net Assets (b)(c) | Turnover (d) | |||||||||||||||||||||
Class II Shares | ||||||||||||||||||||||||||
Period ended December 31, 2006 (e) | $ | 74,804 | 0.74% | 1.90% | 0.91% | 1.72% | 35.00% | |||||||||||||||||||
For the six months ended June 30, 2007 (Unaudited) | $ | 130,752 | 0.73% | (0.23%) | 0.88% | (0.38%) | 21.00% | |||||||||||||||||||
Class VII Shares | ||||||||||||||||||||||||||
Period ended December 31, 2006 (e) | $ | 1 | 0.87% | 1.42% | 0.95% | 1.34% | 35.00% | |||||||||||||||||||
For the six months ended June 30, 2007 (Unaudited) | $ | 1 | 0.38% | 0.09% | 0.53% | 0.06% | 21.00% | |||||||||||||||||||
(a) | Not annualized for periods less than one year. | |
(b) | Annualized for periods less than one year. | |
(c) | During the period, certain fees were waived and/or reimbursed. If such waivers/reimbursements had not occurred, the ratios would have been as indicated. | |
(d) | Portfolio turnover is calculated on the basis of the respective Portfolio in which the Fund invests all of its investable assets. | |
(e) | For the period from May 1, 2006 (commencement of operations) through December 31, 2006. |
See accompanying notes to financial statements.
1. Organization
Nationwide Variable Insurance Trust (“NVIT” or the “Trust”) is an open-end management investment company, organized under the laws of Delaware by an amended and restated Agreement and Declaration of Trust, dated October 28, 2004, as amended to date. Prior to May 1, 2007, the Trust was named “Gartmore Variable Insurance Trust”. The Trust, originally created under the laws of Massachusetts as a Massachusetts business trust pursuant to a Declaration of Trust dated, as of June 30, 1981, and as subsequently amended, redomesticated as a Delaware Statutory Trust after the close of trading on April 29, 2005, and is registered under the Investment Company Act of 1940, as amended (the “1940 Act”). The redomestication was a change in statutory status and did not affect the operations of the Trust. As of June 30, 2007, the Trust had authorized an unlimited number of shares of beneficial interest, without par value (“shares”). The Trust currently offers shares to life insurance company separate accounts to fund the benefits under variable life insurance or annuity policies. To date, only the separate accounts of Nationwide Life Insurance Company and Nationwide Life and Annuity Insurance Company (collectively, “Nationwide”) have purchased shares of the American Funds NVIT Growth Fund (the “Fund”), (formerly, “American Funds GVIT Growth Fund”). The Trust currently operates forty (40) separate series, or mutual funds, each with its own investment objectives and strategies. This report contains the financial statements and financial highlights of the Fund.
The Fund operates as a “feeder fund” which means that the Fund does not buy individual securities directly. Instead, the Fund invests all of its assets in another mutual fund, the American Growth Fund (the “Master Fund”), a series of the American Funds Insurance Series® (“American Funds”), which invests directly in individual securities. The Fund, therefore, has the same investment objective and limitations as the Master Fund in which the Fund invests and the same gross investment returns as the Master Fund. The financial statements of the Master Fund’s portfolio, including the Statement of Investments, are included elsewhere in this report and should be read with the Fund’s financial statements. The percentage of the Master Fund’s portfolio owned by the Fund at June 30, 2007, was 0.44%.
2. Summary of Significant Accounting Policies
The following is a summary of significant accounting policies followed by the Fund in the preparation of its financial statements. The policies are in conformity with accounting principles generally accepted in the United States of America (“GAAP”). The preparation of financial statements requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of income and expenses for the period. Actual results could differ from those estimates.
(a) | Security Valuation |
The net asset value (“NAV”) per share of each class of the Fund is calculated by taking the market value of the Master Fund and other assets owned by the Fund, allocated to the class, subtracting the Fund’s liabilities attributable to that class, and dividing by the number of shares of that class that are outstanding. The Fund’s NAV is determined at the close of regular trading on the New York Stock Exchange (the “Exchange”) (usually 4 p.m. Eastern Time) (“Close of Trading”) on each day the Exchange is open for trading (“Business Day”). | |
The Master Fund calculates its NAV at the Close of Trading on each Business Day. Assets held by the Master Fund are valued primarily on the basis of market quotations. The Master Fund, however, has adopted procedures for making “fair value” determinations if market quotations are not readily available. For example, if events occur between the close of markets outside the United States and the close of regular trading on the New York Stock Exchange that, in the opinion of Capital Research and Management Company (“Capital Research”), the Master Fund’s investment adviser, materially affect the value of the portfolio securities of the Master Fund, the securities will be valued in accordance with the Master Fund’s fair value procedures. Use of these procedures is intended to result in more appropriate NAVs. In addition, such use will reduce, if not eliminate, potential arbitrage opportunities otherwise available to short-term investors in the Master Fund. |
(b) | Security Transactions and Investment Income |
Security transactions are accounted for on the date the security is purchased or sold (“trade date”). Securities gains and losses are calculated on the identified cost basis. Dividend income is recorded on the ex-dividend date. |
(c) | Distributions to Shareholders |
The Fund’s dividends from net investment income, if any, are declared and paid quarterly. The Fund’s distributions from net realized capital gains, if any, are declared and distributed at least annually. | |
Dividends and distributions to shareholders are determined in accordance with federal income tax regulations, which may differ from GAAP. These “book/tax” differences are considered either permanent or temporary in nature. In accordance with the American Institute of Certified Public Accountants Statement of Position 93-2, permanent differences (i.e., reclassification of market discounts, foreign exchange gain/loss, paydowns, and distributions from real estate investment trusts) are reclassified within the capital accounts based on their nature for federal income tax purposes; temporary differences do not require reclassification. These reclassifications have no effect upon the net asset value of the Fund. To the extent distributions exceed current and accumulated earnings and profits for federal income tax purposes, these distributions are reported as distributions of paid-in-capital. |
(d) | Federal Income Taxes |
It is the policy of the Fund to qualify or to continue to qualify as a “regulated investment company” by complying with the provisions available to certain investment companies, as defined in Subchapter M of the U.S. Internal Revenue Code, and to make distributions of net investment income and net realized capital gains sufficient to relieve the Fund from all, or substantially all, federal income taxes. | |
As of June 30, 2007, the tax cost of securities and the breakdown of unrealized appreciation (depreciation) for the Fund was as follows: |
Net Unrealized | ||||||||||||||
Tax Cost of | Unrealized | Unrealized | Appreciation | |||||||||||
Securities | Appreciation | Depreciation | (Depreciation) | |||||||||||
$ | 125,187,755 | $ | 5,521,040 | $ | — | $ | 5,521,040 | |||||||
(e) | Allocation of Expenses, Income, and Gains and Losses |
Expenses directly attributable to the Fund are charged to the Fund. Expenses not directly attributable to the Fund are allocated proportionately among various or all funds within the Trust. The method used by the Fund for allocating income, fund level expenses, and realized and unrealized gains or losses is based on the fair value of shares outstanding relative to net assets. Under this method, each class of shares participates based on the total net asset value of that class’s shares in proportion to the total net assets of the Fund. Expenses specific to a class (such as Rule 12b-1 and administrative services fees) are charged to that class. |
3. Transactions with Affiliates
Under the terms of the Master Fund’s Investment Advisory Agreement, Capital Research manages the investment of the assets and supervises the daily business affairs of the Master Fund. Nationwide Fund Management, LLC (prior to May 1, 2007, this service was provided by Gartmore SA Capital Trust (“GSA”)) (“NFM”), a wholly-owned subsidiary of NFS Distributors, Inc. (“NFSDI”), provides non-investment master-feeder operational support services to the Fund. Under the terms of the Trust’s Master-Feeder Services Agreement with NFM on behalf of the Fund, the Fund pays NFM a fee of 0.25% based on the Fund’s average daily net assets. NFM has entered into a contractual agreement with the Trust under which NFM will waive 0.15% of the fees NFM receives for providing the Fund with non-investment master-feeder operational support services until May 1, 2008.
Under the terms of a Fund Administration and Transfer Agency Agreement, NFM provides the Fund with various administrative and accounting services for the Fund (prior to May 1, 2007, this service was provided by GSA), and serves as Transfer and Dividend Disbursing Agent for the Fund (prior to May 1, 2007, this service was provided by Gartmore Investor Services, Inc. (“GISI”), an indirect subsidiary of GSA). The fees for the services provided under this Agreement are calculated based on the Trust’s average daily net assets according to the fee schedule below. The fees are then allocated proportionately among all funds within the Trust in relation to the average daily net assets of each fund and are paid to NFM. NFM pays NFM from these fees for NFM’s services.
Combined Fee Schedule* | ||||||
Up to $1 billion | 0.15% | |||||
$1 billion up to $3 billion | 0.10% | |||||
$3 billion up to $8 billion | 0.05% | |||||
$8 billion up to $10 billion | 0.04% | |||||
$10 billion up to $12 billion | 0.02% | |||||
$12 billion or more | 0.01% | |||||
* | The assets of the Nationwide NVIT Investor Destinations Aggressive Fund, the Nationwide NVIT Investor Destinations Moderately Aggressive Fund, the Nationwide NVIT Investor Destinations Moderate Fund, the Nationwide NVIT Investor Destinations Moderately Conservative Fund, and the Nationwide NVIT Investor Destinations Conservative Fund (collectively, the “Investor Destinations Funds”) are excluded from the Trust asset level amount in order to calculate this asset-based fee. The Investor Destinations Funds do not pay any part of this fee. |
NFM has entered into agreements with Citi Fund Services Ohio, Inc. (“Citi”), pursuant to which Citi provides sub-administration and sub-transfer agency services, respectively, to the Fund. Effective August 1, 2007, The BISYS Group Inc. was acquired by and became a wholly owned subsidiary of Citi.
Under the terms of a Distribution Plan under Rule 12b-1 of the 1940 Act, Nationwide Fund Distributors, LLC. (formerly, “Gartmore Distribution Services, Inc. (“GDSI”)) (“NFD” or “Distributor”), the Fund’s principal underwriter, is compensated by the Fund for expenses associated with the distribution of the Class II and Class VII shares of the Fund. NFD is a wholly-owned subsidiary of NFSDI. These fees are based on average daily net assets of Class II and Class VII shares of the Fund at an annual rate not to exceed 0.25% of Class II shares and 0.40% of Class VII shares.
Under the terms of an Administrative Services Plan, the Fund may pay fees to servicing organizations, such as broker-dealers, including Nationwide Financial Services, Inc. (“NFS”), and financial institutions, which agree to provide administrative support services to the shareholders of certain classes. NFM is a wholly-owned subsidiary of NFS. These services include, but are not limited, to the following: establishing and maintaining shareholder accounts; processing purchase and redemption transactions; arranging bank wires; performing shareholder sub-accounting; answering inquires regarding the Fund; and other such services. These fees are based on an annual rate of up to 0.25% of the average daily net assets of each class of shares of the Fund.
For the six months ended June 30, 2007, NFS received $127,046 in Administrative Services Fees from the Fund.
Under the terms of a letter agreement dated September 12, 2006, by and among NFM, the Audit Committee of the Trust and the Trust, the Trust has agreed to reimburse NFM certain costs related to the Fund’s portion of ongoing administration, monitoring and annual (audit) testing of the Trust’s Rule 38a-1 Compliance Program subject to the pre-approval of the Trust’s Audit Committee. For the six months ended June 30, 2007, the Fund’s portion of such costs amounted to $660.
4. Bank Loans and Earnings Credit
The Trust has a credit agreement with JPMorgan Chase & Co., the Fund’s custodian bank, permitting the Trust to borrow up to $100,000,000. Borrowings under this arrangement bear interest at the Federal Funds rate plus 0.50%. The interest costs, if any, would be included in other fees in the Statement of Operations. No compensating balances were
The Trust’s custodian bank has agreed to reduce the bank’s fees (earnings credit) when the funds of the Trust maintain cash on deposit in non-interest-bearing custody and Demand Deposit Accounts. Earnings credits, if any, are shown as a reduction of total expenses on the Statement of Operations.
5. Indemnifications
Under the Trust’s organizational documents, certain of the Trust’s Officers and Trustees are indemnified against certain liabilities arising out of the performance of their duties to the Trust. In addition, the Trust has entered into Indemnification Agreements with the Trust’s trustees and certain officers covering similar liabilities. Trust Officers receive no compensation from the Trust for serving as the Trust’s Officers. In addition, in the normal course of business, the Trust enters into contracts with its vendors and others that provide for general indemnifications. The Trust’s maximum exposure under these arrangements is unknown, as this would involve future claims that may be made against the Trust. Based on experience, however, the Trust expects that risk of loss to be remote.
6. Recently Issued Accounting Pronouncements
On July 13, 2006, the Financial Accounting Standards Board (“FASB”) released FASB Interpretation No. 48, Accounting for Uncertainty in Income Taxes (“FIN 48”). FIN 48 provides guidance for how uncertain tax positions should be recognized, measured, presented and disclosed in the financial statements. FIN 48 requires the affirmative evaluation of tax positions taken or expected to be taken in the course of preparing the Fund’s tax returns to determine whether it is more-likely-than-not (i.e., greater than 50 percent) that each tax position will be sustained upon examination by a taxing authority based on the technical merits of the position. A tax position that meets the more-likely-than-not recognition threshold is measured to determine the amount of benefit to recognize in the financial statements. Differences between tax positions taken in a tax return and amounts recognized in the financial statements will generally result in an increase in a liability for taxes payable (or a reduction of a tax refund receivable) and an increase in a deferred tax liability (or a reduction in a deferred tax asset). Adoption of FIN 48 was required no later than the last business day of the first financial statement reporting period for fiscal years beginning after December 15, 2006 and is to be applied to all open tax years as of the effective date. Accordingly, the Fund was required to implement FIN 48 in its net asset value per share (NAV) calculation on June 29, 2007. Management has evaluated the implications of FIN 48 and has concluded that there was no impact to the Fund’s financial statements as of June 29, 2007. The adoption of FIN 48 requires ongoing monitoring and analysis, future conclusions reached by management may be different and result in adjustments to the Fund’s NAV and financial statements.
In September 2006, the FASB issued Statement on Financial Accounting Standards (“SFAS”) No. 157, “Fair Value Measurements.” This standard establishes a single authoritative definition of fair value, sets out a framework for measuring fair value and requires additional disclosures about fair value measurements. SFAS No. 157 applies to fair value measurements already required or permitted by existing standards. SFAS No. 157 is effective for financial statements issued for fiscal years beginning after November 15, 2007 and interim periods within those fiscal years. The changes to current accounting principles generally accepted in the United States of America from the application of this Statement relate to the definition of fair value, the methods used to measure fair value, and the expanded disclosures about fair value measurements. As of June 30, 2007, the Fund does not believe the adoption of SFAS No. 157 will impact the financial statement amounts; however, additional disclosures may be required about the inputs used to develop the measurements and the effect of certain of the measurements on changes in net assets for the period.
As a shareholder of the Fund, you incur two types of costs: (1) transaction costs, including sales charges (loads) paid on purchase payments and redemption fees; and (2) ongoing costs, including investment advisory fees, administration fees, distribution fees and other Fund expenses. The examples below are 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. Per SEC requirements, the examples assume that you had a $1,000 investment in the Class at the beginning of the reporting period, April 27, 2007, and continued to hold your shares at the end of the reporting period, June 30, 2007.
Actual Expenses
Hypothetical Example for Comparison Purposes
Please note that the expenses shown in the table are meant to highlight your ongoing costs only and do not reflect any transaction costs, such as sales charges (loads) or redemption fees. Therefore, the second line for each Class in 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 transaction costs were included, your costs would have been higher. The examples also assume all dividends and distributions have been reinvested.
Schedule of Shareholder Expenses
Beginning | Ending | Expenses | Annualized | |||||||||||||||||||
American Funds NVIT Growth- | Account Value | Account Value | Paid | Expense | ||||||||||||||||||
Income Fund | 4/27/07 | 06/30/07 | During Period* | Ratio** | ||||||||||||||||||
Class II | Actual | $ | 1,000.00 | $ | 1,015.20 | $ | 0.54 | 0.30% | ||||||||||||||
Hypothetical | 1 | $ | 1,000.00 | $ | 1,008.37 | $ | 0.54 | 0.30% | ||||||||||||||
Class VII | Actual | $ | 1,000.00 | $ | 1,015.20 | $ | 0.56 | 0.31% | ||||||||||||||
Hypothetical | 1 | $ | 1,000.00 | $ | 1,008.35 | $ | 0.55 | 0.31% | ||||||||||||||
* | Expenses are equal to the Fund’s annualized expense ratio multiplied by the average account value over the period multiplied by 65/365 (to reflect the period of operations). The expenses reported above do not include the effect of additional expenses imposed by variable annuity contracts. | |
** | Information shown reflects values using the expense ratios from April 27, 2007 (commencement of operations) to June 30, 2007 and has been annualized to reflect for the period from April 27, 2007 to June 30, 2007, in accordance with SEC guidelines. | |
1 | Represents the hypothetical 5% return before expenses. |
American Funds | ||||||
NVIT Growth- | ||||||
Income Fund | ||||||
Assets: | ||||||
Investments in Master Fund (cost $3,391,023) | $ | 3,324,209 | ||||
Cash | 72 | |||||
Receivable for capital shares issued | 28,020 | |||||
Prepaid expenses | 13,795 | |||||
Total Assets | 3,366,096 | |||||
Liabilities: | ||||||
Payable for capital shares redeemed | 673 | |||||
Accrued expenses and other payables: | ||||||
Fund administration and transfer agent fees | 72 | |||||
Master feeder service provider fee | 194 | |||||
Distribution fees | 486 | |||||
Administrative servicing fees | 474 | |||||
Compliance program costs | 10 | |||||
Other | 66 | |||||
Total Liabilities | 1,975 | |||||
Net Assets | $ | 3,364,121 | ||||
Represented by: | ||||||
Capital | $ | 3,349,850 | ||||
Accumulated net investment loss | (628 | ) | ||||
Accumulated net realized gains from investment transactions and distributions from Master Fund | 81,713 | |||||
Net unrealized depreciation on investments | (66,814 | ) | ||||
Net Assets | $ | 3,364,121 | ||||
Net Assets: | ||||||
Class II Shares | $ | 3,363,106 | ||||
Class VII Shares | 1,015 | |||||
Total | $ | 3,364,121 | ||||
Shares outstanding (unlimited number of shares authorized): | ||||||
Class II Shares | 73,991 | |||||
Class VII Shares | 22 | |||||
Total | 74,013 | |||||
Net asset value and offering price per share (Net assets by class divided by shares outstanding by class, respectively.): | ||||||
Class II Shares | $ | 45.45 | ||||
Class VII Shares | $ | 45.48 | (a) | |||
(a) | The NAV reported above represents the traded NAV at June 30, 2007. Due to the financial statement rounding of class assets and class shares above, the NAV results in a different NAV than the traded NAV. |
41
American Funds | |||||
NVIT | |||||
Growth-Income | |||||
Fund(a) | |||||
INVESTMENT INCOME: | |||||
Dividend income | $ | 7,550 | |||
Total Income | 7,550 | ||||
Expenses: | |||||
Fund administration and transfer agent fees | 250 | ||||
Master feeder service provider fee | 697 | ||||
Distribution fees Class II Shares | 697 | ||||
Distribution fees Class VII Shares | 1 | ||||
Administrative servicing fees Class II Shares | 696 | ||||
Administrative services fees Class VII Shares | 1 | ||||
Custodian fees | 16 | ||||
Trustee fees | 17 | ||||
Compliance program costs (Note 3) | 10 | ||||
Printing fees | 252 | ||||
Other | 148 | ||||
Total expenses before reimbursements | 2,785 | ||||
Expenses waived for Master feeder service provider fee | (419 | ) | |||
Net Expenses | 2,366 | ||||
Net Investment Income | 5,184 | ||||
REALIZED/ UNREALIZED GAINS (LOSSES) FROM INVESTMENTS: | |||||
Net realized gains on investment transactions | 2,025 | ||||
Net realized gain distributions from Master Fund | 79,688 | ||||
Net realized gains on investment transactions and distributions from Master Fund | 81,713 | ||||
Net change in unrealized depreciation on investments | (66,814 | ) | |||
Net realized/unrealized gains (losses) on investments | 14,899 | ||||
CHANGE IN NET ASSETS RESULTING FROM OPERATIONS | $ | 20,083 | |||
(a) | For the period from April 27, 2007 (commencement of operations) through June 30, 2007. |
42
American Funds | |||||
NVIT Growth- | |||||
Income Fund | |||||
Six Months Ended | |||||
June 30, 2007 (a) | |||||
(Unaudited) | |||||
From Investment Activities: | |||||
Operations: | |||||
Net investment income | $ | 5,184 | |||
Net realized gains on investment transactions and distributions from Master Fund | 81,713 | ||||
Net change in unrealized depreciation on investments | (66,814 | ) | |||
Change in net assets resulting from operations | 20,083 | ||||
Distributions to Shareholders from: | |||||
Net investment income: | |||||
Class II | (5,811 | ) | |||
Class VII | (1 | ) | |||
Change in net assets from shareholder distributions | (5,812 | ) | |||
Change in net assets from capital transactions | 3,349,850 | ||||
Change in net assets | 3,364,121 | ||||
Net Assets: | |||||
Beginning of period | — | ||||
End of period | $ | 3,364,121 | |||
Accumulated net investment loss at end of period | $ | (628 | ) | ||
CAPITAL TRANSACTIONS: | |||||
Class II Shares | |||||
Proceeds from shares issued | $ | 3,432,501 | |||
Dividends reinvested | 5,811 | ||||
Cost of shares redeemed | (89,463 | ) | |||
3,348,849 | |||||
Class VII Shares | |||||
Proceeds from shares issued | 1,000 | ||||
Dividends reinvested | 1 | ||||
1,001 | |||||
Change in net assets from capital transactions | $ | 3,349,850 | |||
SHARE TRANSACTIONS: | |||||
Class II Shares | |||||
Issued | 75,821 | ||||
Reinvested | 128 | ||||
Redeemed | (1,958 | ) | |||
73,991 | |||||
Class VII Shares | |||||
Issued | 22 | ||||
Reinvested | — | (b) | |||
22 | |||||
Total change in shares | 74,013 | ||||
(a) | For the period from April 27, 2007 (commencement of operations) through June 30, 2007. | |
(b) | Amount is less than 1 share. |
43
Investment Activities | ||||||||||||||||
Net Realized | ||||||||||||||||
Net Asset | and | Total | ||||||||||||||
Value, | Net | Unrealized | from | |||||||||||||
Beginning | Investment | Gains on | Investment | |||||||||||||
of Period | Income | Investments | Activities | |||||||||||||
Class II Shares | ||||||||||||||||
For the six months ended June 30, 2007 (Unaudited) (d) | $ | 44.86 | 0.08 | 0.60 | 0.68 | |||||||||||
Class VII Shares | ||||||||||||||||
For the six months ended June 30, 2007 (Unaudited) (d) | $ | 44.86 | 0.06 | 0.62 | 0.68 | |||||||||||
[Additional columns below]
[Continued from above table, first column(s) repeated]
Distributions | Ratios / Supplemental Data | |||||||||||||||||||||||
Net Assets | Ratio of | |||||||||||||||||||||||
Net | Net Asset | at End | Expenses | |||||||||||||||||||||
Investment | Total | Value, End | Total | of Period | to Average | |||||||||||||||||||
Income | Distributions | of Period | Return (a) | (000s) | Net Assets (b) | |||||||||||||||||||
Class II Shares | ||||||||||||||||||||||||
For the six months ended June 30, 2007 (Unaudited) (d) | (0.09 | ) | (0.09 | ) | $ | 45.45 | 1.52% | $ | 3,363 | 0.30% | ||||||||||||||
Class VII Shares | ||||||||||||||||||||||||
For the six months ended June 30, 2007 (Unaudited) (d) | (0.06 | ) | (0.06 | ) | $ | 45.48 | 1.52% | $ | 1 | 0.31% | ||||||||||||||
[Additional columns below]
[Continued from above table, first column(s) repeated]
Ratios / Supplemental Data | ||||||||||||||||||
Ratio of Net | ||||||||||||||||||
Ratio of | Ratio of | Investment | ||||||||||||||||
Net | Expenses | Income | ||||||||||||||||
Investment | (Prior to | (Prior to | ||||||||||||||||
Income | Reimbursements) | Reimbursements) | ||||||||||||||||
to Average | to Average | to Average | Portfolio | |||||||||||||||
Net Assets (b) | Net Assets (b) (c) | Net Assets (b) (c) | Turnover(e) | |||||||||||||||
Class II Shares | ||||||||||||||||||
For the six months ended June 30, 2007 (Unaudited) (d) | 0.67% | 0.36% | 1.71% | 10.00% | ||||||||||||||
Class VII Shares | ||||||||||||||||||
For the six months ended June 30, 2007 (Unaudited) (d) | 0.29% | 0.36% | 0.64% | 10.00% | ||||||||||||||
(a) | Not annualized for periods less than one year. | |
(b) | Annualized for periods less than one year. | |
(c) | During the period, certain fees were waived and/or reimbursed. If such waivers/reimbursements had not occurred, the ratios would have been as indicated. | |
(d) | For the period from April 27, 2007 (commencement of operations) through June 30, 2007. | |
(e) | Portfolio turnover is calculated on the basis of the respective Portfolio in which the Fund invests all of its investable assets. |
See notes to financial statements.
1. Organization
Nationwide Variable Insurance Trust (“NVIT” or the “Trust”) is an open-end management investment company, organized under the laws of Delaware by an amended and restated Agreement and Declaration of Trust, dated October 28, 2004, as amended to date. Prior to May 1, 2007, the Trust was named “Gartmore Variable Insurance Trust”. The Trust, originally created under the laws of Massachusetts as a Massachusetts business trust pursuant to a Declaration of Trust dated, as of June 30, 1981, and as subsequently amended, redomesticated as a Delaware Statutory Trust after the close of trading on April 29, 2005, and is registered under the Investment Company Act of 1940, as amended (the “1940 Act”). The redomestication was a change in statutory status and did not affect the operations of the Trust. As of June 30, 2007, the Trust had authorized an unlimited number of shares of beneficial interest, without par value (“shares”). The Trust currently offers shares to life insurance company separate accounts to fund the benefits under variable life insurance or annuity policies. To date, only the separate accounts of Nationwide Life Insurance Company and Nationwide Life and Annuity Insurance Company (collectively, “Nationwide”) have purchased shares of the American Funds NVIT Growth-Income Fund (the “Fund”). The Trust currently operates forty (40) separate series, or mutual funds, each with its own investment objectives and strategies. This report contains the financial statements and financial highlights of the Fund.
The Fund operates as a “feeder fund” which means that the Fund does not buy individual securities directly. Instead, the Fund invests all of its assets in another mutual fund, the American Bond Fund (the “Master Fund”), a series of the American Funds Insurance Series® (“American Funds”), which invests directly in individual securities. The Fund, therefore, has the same investment objective and limitations as the Master Fund in which the Fund invests and the same gross investment returns as the Master Fund. The financial statements of the Master Fund’s portfolio, including the Statement of Investments, are included elsewhere in this report and should be read with the Fund’s financial statements. The percentage of the Master Fund’s portfolio owned by the Fund at June 30, 2007, was 0.01%.
2. Summary of Significant Accounting Policies
The following is a summary of significant accounting policies followed by the Fund in the preparation of its financial statements. The policies are in conformity with accounting principles generally accepted in the United States of America (“GAAP”). The preparation of financial statements requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of income and expenses for the period. Actual results could differ from those estimates.
(a) | Security Valuation |
The net asset value (“NAV”) per share of each class of the Fund is calculated by taking the market value of the Master Fund and other assets owned by the Fund, allocated to the class, subtracting the Fund’s liabilities attributable to that class, and dividing by the number of shares of that class that are outstanding. The Fund’s NAV is determined at the close of regular trading on the New York Stock Exchange (the “Exchange”) (usually 4 p.m. Eastern Time) (“Close of Trading”) on each day the Exchange is open for trading (“Business Day”). | |
The Master Fund calculates its NAV at the Close of Trading on each Business Day. Assets held by the Master Fund are valued primarily on the basis of market quotations. The Master Fund, however, has adopted procedures for making “fair value” determinations if market quotations are not readily available. For example, if events occur between the close of markets outside the United States and the close of regular trading on the New York Stock Exchange that, in the opinion of Capital Research and Management Company (“Capital Research”), the Master Fund’s investment adviser, materially affect the value of the portfolio securities of the Master Fund, the securities will be valued in accordance with the Master Fund’s fair value procedures. Use of these procedures is intended to result in more appropriate NAVs. In addition, such use will reduce, if not eliminate, potential arbitrage opportunities otherwise available to short-term investors in the Master Fund. |
(b) | Security Transactions and Investment Income |
Security transactions are accounted for on the date the security is purchased or sold (“trade date”). Securities gains and losses are calculated on the identified cost basis. Interest income is recognized on the accrual basis and includes, where applicable, the amortization or accretion of premium or discount. Dividend income is recorded on the ex-dividend date. |
(c) | Distributions to Shareholders |
The Fund’s dividends from net investment income, if any, are declared and paid quarterly. The Fund’s distributions from net realized capital gains, if any, are declared and distributed at least annually. | |
Dividends and distributions to shareholders are determined in accordance with federal income tax regulations, which may differ from GAAP. These “book/tax” differences are considered either permanent or temporary in nature. In accordance with the American Institute of Certified Public Accountants Statement of Position 93-2, permanent differences (i.e., reclassification of market discounts, foreign exchange gain/loss, paydowns, and distributions from real estate investment trusts) are reclassified within the capital accounts based on their nature for federal income tax purposes; temporary differences do not require reclassification. These reclassifications have no effect upon the net asset value of the Fund. To the extent distributions exceed current and accumulated earnings and profits for federal income tax purposes, these distributions are reported as distributions of paid-in-capital. |
(d) | Federal Income Taxes |
It is the policy of the Fund to qualify or to continue to qualify as a “regulated investment company” by complying with the provisions available to certain investment companies, as defined in Subchapter M of the U.S. Internal Revenue Code, and to make distributions of net investment income and net realized capital gains sufficient to relieve the Fund from all, or substantially all, federal income taxes. | |
As of June 30, 2007, the tax cost of securities and the breakdown of unrealized appreciation (depreciation) for the Fund was as follows: |
Net Unrealized | ||||||||||||||
Tax Cost of | Unrealized | Unrealized | Appreciation | |||||||||||
Securities | Appreciation | Depreciation | (Depreciation) | |||||||||||
$ | 3,391,023 | $ | — | $ | (66,814 | ) | $ | (66,814 | ) | |||||
(e) | Allocation of Expenses, Income, and Gains and Losses |
Expenses directly attributable to the Fund are charged to the Fund. Expenses not directly attributable to the Fund are allocated proportionately among various or all funds within the Trust. The method used by the Fund for allocating income, fund level expenses, and realized and unrealized gains or losses is based on the fair value of shares outstanding relative to net assets. Under this method, each class of shares participates based on the total net asset value of that class’s shares in proportion to the total net assets of the Fund. Expenses specific to a class (such as Rule 12b-1 and administrative services fees) are charged to that class. |
3. Transactions with Affiliates
Under the terms of the Master Fund’s Investment Advisory Agreement, Capital Research manages the investment of the assets and supervises the daily business affairs of the Master Fund. Nationwide Fund Management, LLC (prior to May 1, 2007, this service was provided by Gartmore SA Capital Trust (“GSA”)) (“NFM”), a wholly-owned subsidiary of NFS Distributors, Inc. (“NFSDI”), provides non-investment master-feeder operational support services to the Fund. Under the terms of the Trust’s Master-Feeder Services Agreement with NFM on behalf of the Fund, the Fund pays NFM a fee of 0.25% based on the Fund’s average daily net assets. NFM has entered into a contractual agreement with the Trust under
Under the terms of a Fund Administration and Transfer Agency Agreement, NFM provides the Fund with various administrative and accounting services for the Fund (prior to May 1, 2007, this service was provided by GSA), and serves as Transfer and Dividend Disbursing Agent for the Fund (prior to May 1, 2007, this service was provided by Gartmore Investor Services, Inc. (“GISI”), an indirect subsidiary of GSA). The fees for the services provided under this Agreement are calculated based on the Trust’s average daily net assets according to the fee schedule below. The fees are then allocated proportionately among all funds within the Trust in relation to the average daily net assets of each fund and are paid to NFA. NFA pays NFM from these fees for NFM’s services.
Combined Fee Schedule* | ||||||
Up to $1 billion | 0.15% | |||||
$1 billion up to $3 billion | 0.10% | |||||
$3 billion up to $8 billion | 0.05% | |||||
$8 billion up to $10 billion | 0.04% | |||||
$10 billion up to $12 billion | 0.02% | |||||
$12 billion or more | 0.01% | |||||
* | The assets of the Nationwide NVIT Investor Destinations Aggressive Fund, the Nationwide NVIT Investor Destinations Moderately Aggressive Fund, the Nationwide NVIT Investor Destinations Moderate Fund, the Nationwide NVIT Investor Destinations Moderately Conservative Fund, and the Nationwide NVIT Investor Destinations Conservative Fund (collectively, the “Investor Destinations Funds”) are excluded from the Trust asset level amount in order to calculate this asset-based fee. The Investor Destinations Funds do not pay any part of this fee. |
NFM has entered into agreements with Citi Fund Services Ohio, Inc. (“Citi”), pursuant to which Citi provides sub-administration and sub-transfer agency services, respectively, to the Fund. Effective August 1, 2007, The BISYS Group Inc. was acquired by and became a wholly owned subsidiary of Citi.
Under the terms of a Distribution Plan under Rule 12b-1 of the 1940 Act, Nationwide Fund Distributors, LLC. (formerly, “Gartmore Distribution Services, Inc. (“GDSI”)) (“NFD” or “Distributor”), the Fund’s principal underwriter, is compensated by the Fund for expenses associated with the distribution of the Class II and Class VII shares of the Fund. NFD is a wholly-owned subsidiary of NFSDI. These fees are based on average daily net assets of Class II and Class VII shares of the Fund at an annual rate not to exceed 0.25% of Class II shares and 0.40% of Class VII shares.
Under the terms of an Administrative Services Plan, the Fund may pay fees to servicing organizations, such as broker-dealers, including Nationwide Financial Services, Inc. (“NFS”), and financial institutions, which agree to provide administrative support services to the shareholders of certain classes. NFM is a wholly-owned subsidiary of NFS. These services include, but are not limited, to the following: establishing and maintaining shareholder accounts; processing purchase and redemption transactions; arranging bank wires; performing shareholder sub-accounting; answering inquires regarding the Fund; and other such services. These fees are based on an annual rate of up to 0.25% of the average daily net assets of each class of shares of the Fund.
For the period ended June 30, 2007, NFS received $223 in Administrative Services Fees from the Fund.
Under the terms of a letter agreement dated September 12, 2006, by and among NFM, the Audit Committee of the Trust and the Trust, the Trust has agreed to reimburse NFM certain costs related to the Fund’s portion of ongoing administration, monitoring and annual (audit) testing of the Trust’s Rule 38a-1 Compliance Program subject to the pre-approval of the Trust’s Audit Committee. For the period ended June 30, 2007, the Fund’s portion of such costs amounted to $10.
4. Bank Loans and Earnings Credit
The Trust has a credit agreement with JPMorgan Chase & Co., the Fund’s custodian bank, permitting the Trust to borrow up to $100,000,000. Borrowings under this arrangement bear interest at the Federal Funds rate plus 0.50%. The interest costs, if any, would be included in other fees in the Statement of Operations. No compensating balances were required under the terms of the line of credit. The line of credit is renewed annually, expiring on June 25, 2008, with a commitment fee of 0.07% per year on $100,000,000. There were no borrowings outstanding under this line of credit for the period ended June 30, 2007.
The Trust’s custodian bank has agreed to reduce the bank’s fees (earnings credit) when the funds of the Trust maintain cash on deposit in non-interest-bearing custody and Demand Deposit Accounts. Earnings credits, if any, are shown as a reduction of total expenses on the Statement of Operations.
5. Indemnifications
Under the Trust’s organizational documents, certain of the Trust’s Officers and Trustees are indemnified against certain liabilities arising out of the performance of their duties to the Trust. In addition, the Trust has entered into Indemnification Agreements with the Trust’s trustees and certain officers covering similar liabilities. Trust Officers receive no compensation from the Trust for serving as the Trust’s Officers. In addition, in the normal course of business, the Trust enters into contracts with its vendors and others that provide for general indemnifications. The Trust’s maximum exposure under these arrangements is unknown, as this would involve future claims that may be made against the Trust. Based on experience, however, the Trust expects that risk of loss to be remote.
6. Recently Issued Accounting Pronouncements
On July 13, 2006, the Financial Accounting Standards Board (“FASB”) released FASB Interpretation No. 48, Accounting for Uncertainty in Income Taxes (“FIN 48”). FIN 48 provides guidance for how uncertain tax positions should be recognized, measured, presented and disclosed in the financial statements. FIN 48 requires the affirmative evaluation of tax positions taken or expected to be taken in the course of preparing the Fund’s tax returns to determine whether it is more-likely-than-not (i.e., greater than 50 percent) that each tax position will be sustained upon examination by a taxing authority based on the technical merits of the position. A tax position that meets the more-likely-than-not recognition threshold is measured to determine the amount of benefit to recognize in the financial statements. Differences between tax positions taken in a tax return and amounts recognized in the financial statements will generally result in an increase in a liability for taxes payable (or a reduction of a tax refund receivable) and an increase in a deferred tax liability (or a reduction in a deferred tax asset). Adoption of FIN 48 was required no later than the last business day of the first financial statement reporting period for fiscal years beginning after December 15, 2006 and is to be applied to all open tax years as of the effective date. Accordingly, the Fund was required to implement FIN 48 in its net asset value per share (NAV) calculation on June 29, 2007. Management has evaluated the implications of FIN 48 and has concluded that there was no impact to the Fund’s financial statements as of June 29, 2007. The adoption of FIN 48 requires ongoing monitoring and analysis, future conclusions reached by management may be different and result in adjustments to the Fund’s NAV and financial statements.
In September 2006, the FASB issued Statement on Financial Accounting Standards (“SFAS”) No. 157, “Fair Value Measurements.” This standard establishes a single authoritative definition of fair value, sets out a framework for measuring fair value and requires additional disclosures about fair value measurements. SFAS No. 157 applies to fair value measurements already required or permitted by existing standards. SFAS No. 157 is effective for financial statements issued for fiscal years beginning after November 15, 2007 and interim periods within those fiscal years. The changes to current accounting principles generally accepted in the United States of America from the application of this Statement relate to the definition of fair value, the methods used to measure fair value, and the expanded disclosures about fair value measurements. As of June 30, 2007, the Fund does not believe the adoption of SFAS No. 157 will impact the financial statement amounts; however, additional disclosures may be required about the inputs used to develop the measurements and the effect of certain of the measurements on changes in net assets for the period.
Trustees who are not Interested Persons (as defined in the 1940 Act) and Officers of the Trust as of
Number of Portfolios | ||||||||||
Position(s) Held | in the | |||||||||
with the Trust | Principal Occupation(s) | Nationwide Fund | Other | |||||||
Name, Address | and Length of | During Past | Complex Overseen | Directorships | ||||||
and Year of Birth | Time Served1 | Five Years | by Trustee | Held by Trustee2 | ||||||
Charles E. Allen c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1948 | Trustee since July 2000 | Mr. Allen is Chairman, Chief Executive Officer and President of Graimark Realty Advisors, Inc. (real estate development, investment and asset management). | 89 | None | ||||||
Paula H.J. Cholmondeley c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1947 | Trustee since July 2000 | Ms. Cholmondeley was Vice President and General Manager of Sappi Fine Paper North America from April 2000 through December 2003. | 89 | Director of Dentsply International, Inc. (dental products), Ultralife Batteries, Inc., Terex Corporation (construction equipment), Minerals Technology, Inc. (specialty chemicals) and Albany International Corp. (paper industry) | ||||||
C. Brent DeVore3 c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1940 | Trustee since 1990 | Dr. DeVore is President of Otterbein College. | 89 | None | ||||||
Phyllis Kay Dryden c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1947 | Trustee since December 2004 | Ms. Dryden was a partner of Mitchell Madison, a management consulting company from January 2006 until December 2006; she is currently a consultant with the company. Ms. Dryden was formerly Managing Partner of march FIRST, a global management consulting firm. | 89 | None | ||||||
Barbara L. Hennigar c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1935 | Trustee since July 2000 | Retired. | 89 | None | ||||||
Number of Portfolios | ||||||||||
Position(s) Held | in the | |||||||||
with the Trust | Principal Occupation(s) | Nationwide Fund | Other | |||||||
Name, Address | and Length of | During Past | Complex Overseen | Directorships | ||||||
and Year of Birth | Time Served1 | Five Years | by Trustee | Held by Trustee2 | ||||||
Barbara I. Jacobs c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1950 | Trustee since December 2004 | Ms. Jacobs served as Chairman of the Board of Directors of KICAP Network Fund, a European (United Kingdom) hedge fund, from January 2001 through January 2006. From 1998-2003, Ms. Jacobs was also a Managing Director and European Portfolio Manager of CREF Investments (Teachers Insurance and Annuity Association-College Retirement Equities Fund). | 89 | None | ||||||
Douglas F. Kridler c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1955 | Trustee since September 1997 | Mr. Kridler has served as the President and Chief Executive Officer of the Columbus Foundation (a Columbus, OH-based foundation which manages over 1,300 individual endowment funds) since February 2002. Prior to January 31, 2002, Mr. Kridler was the President of the Columbus Association for the Performing Arts and Chairman of the Greater Columbus Convention and Visitors Bureau. | 89 | None | ||||||
Michael D. McCarthy c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1947 | Trustee since December 2004 | Retired. Mr. McCarthy was Chairman of VMAC (commodity swaps) from October 2002 until January 2007; and a partner of Pineville Properties LLC (a commercial real estate development firm) from September 2000 until January 2007. | 89 | None | ||||||
David C. Wetmore c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1948 | Trustee since 1995 and Chairman since February 2005 | Retired. | 89 | None | ||||||
1 | Length of time served includes time served with the Trust’s predecessors. | |
2 | Directorships held in (1) any other investment companies registered under the 1940 Act, (2) any company with a class of securities registered pursuant to Section 12 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or (3) any company subject to the requirements of Section 15(d) of the Exchange Act. | |
3 | Mr. DeVore has served as President of Otterbein College since 1984. Mark Thresher, President and Chief Operating Officer of Nationwide Financial Services, Inc. (“NFS”) has served as a member of the Board of Trustees of Otterbein College since 2000, currently serves as one of 30 of its trustees, and is currently one of two Vice Chairmen of the Board. Each of Nationwide Fund Advisors (“NFA”), the Funds’ investment adviser, and Nationwide Fund Distributors LLC (“NFD”), principal underwriter to the Trust, is a wholly-owned subsidiary of NFS. | |
Additional information regarding the Trustees and Officers may be found in the Trust’s Statement of Additional Information, which is available without charge upon request, by calling 800-848-0920. |
Trustees who are Interested Persons (as defined in the 1940 Act) and/or Officers of the Trust as of
Number of Portfolios | ||||||||||
Position(s) Held | in the | |||||||||
with the Trust | Principal Occupation(s) | Nationwide Fund | Other | |||||||
Name, Address | and Length of | During Past | Complex Overseen | Directorships | ||||||
and Year of Birth | Time Served1 | 5 Years | by Trustee | Held by Trustee 2 | ||||||
Arden L. Shisler c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1941 | Trustee since February 2000 | Retired. Mr. Shisler is the former President and Chief Executive Officer of KeB Transport, Inc., a trucking firm (2000 through 2002). He served as a consultant to KeB from January 2003 through December 2004. Since 1992, Mr. Shisler has also been Chairman of the Board for Nationwide Mutual Insurance Company.3 | 89 | Director of Nationwide Financial Services, Inc., Chairman of Nationwide Mutual Insurance Company3 | ||||||
John H. Grady Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1961 | President & Chief Executive Officer since December 2006 | Mr. Grady is President, and Chief Executive Officer of Nationwide Funds Group which includes Nationwide Fund Advisors,3 Nationwide Fund Management LLC,3 Nationwide Fund Distributors LLC 3 and NWD Investments,2 the asset management operations of Nationwide Mutual Insurance Company, which includes Morley Capital Management, Inc.,2 Nationwide Separate Accounts LLC,2 NorthPointe Capital LLC,2 and Nationwide SA Capital Trust2. From March 2004 until March 2006, Mr. Grady was Chief Executive Officer of Constellation Investment Management Co., L.P. (registered investment adviser), and President and Chief Executive Officer of Constellation Funds Group (registered investment companies). He also was President of Constellation Investment Distribution Co., Inc. (registered broker-dealer) from March 2004 until June 2006. From February 2001 until February 2004, Mr. Grady was Chief Operating and Chief Legal Officer; Managing Director, Mutual Funds Group, Turner Investment Partners, Inc. (registered investment adviser); Executive Vice President of Turner Funds and Turner Institutional Portfolios (registered investment companies); and President, Turner Investment Distributors, Inc. (registered broker-dealer). | N/A | None | ||||||
Gerald J. Holland Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1951 | Treasurer since March 2001 | Mr. Holland is Senior Vice President—Operations for Nationwide Funds Group3. | N/A | N/A | ||||||
Number of Portfolios | ||||||||||
Position(s) Held | in the | |||||||||
with the Trust | Principal Occupation(s) | Nationwide Fund | Other | |||||||
Name, Address | and Length of | During Past | Complex Overseen | Directorships | ||||||
and Year of Birth | Time Served1 | 5 Years | by Trustee | Held by Trustee 2 | ||||||
Michael A. Krulikowski Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1959 | Chief Compliance Officer from June 2004 to August 20074 | Mr. Krulikowski is Vice President and Chief Compliance Officer of Nationwide Funds Group3, Morley Capital Management, Inc.3, Nationwide SA Capital Trust (since 1999)3, and Nationwide Separate Accounts LLC (since August 2005).3 Since June 2004, Mr. Krulikowski has also served as Chief Compliance Officer of the Trust. From November 1999 through May 2007, he served as Vice President and Chief Compliance Officer of NorthPointe Capital LLC. 3 | N/A | N/A | ||||||
Eric E. Miller Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1953 | Secretary since December 2002 | Mr. Miller is Senior Vice President, General Counsel, and Assistant Secretary for Nationwide Funds Group3 and NWD Investments.2 From August 2000 to August 2002, Mr. Miller was a Partner with Stradley Ronon Stevens & Young, LLP. | N/A | N/A | ||||||
1 | Length of time served includes time served with the Trust’s predecessors. | |
2 | Directorships held in (1) any other investment companies registered under the 1940 Act, (2) any company with a class of securities registered pursuant to Section 12 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or (3) any company subject to the requirements of Section 15(d) of the Exchange Act. | |
3 | This position is held with an affiliated person or principal underwriter of the Trust. | |
4 | Effective August 3, 2007, the Board of Trustees approved Carol Baldwin Moody as Chief Compliance Officer of the Trust. Since November 2005, Ms. Moody has been Senior Vice President, Chief Compliance Officer of Nationwide Financial Services, Nationwide Life Insurance Company, Nationwide Life and Annuity Insurance Company, and Nationwide Investment Advisors, LLC. From February 2004-November 2005, she was Chief Compliance Officer of TIAA-CREF and from April 2000-February 2004, she was Managing Director and General Counsel, TCW/ Latin America Partners, LLC and Baeza & Co., LLC. | |
Federal law requires the Trust, each of its investment advisers and sub-advisers to adopt procedures for voting proxies (“Proxy Voting Guidelines”) and to provide a summary of those Proxy Voting Guidelines used to vote the securities held by the Funds. The Funds’ proxy voting policies and procedures are available without charge (i) upon request, by calling 800-848-0920, (ii) on the Funds’ website at www.nationwidefunds.com, or (iii) on the Securities and Exchange Commission’s website at www.sec.gov. |
A. Submission of Matters to a Vote of Security Holders:
On April 25, 2007, a Special Meeting of Shareholders was held* (the “April 25 Meeting”) at which shareholders of the Funds** set forth below were asked:
Proposal 1:
To approve a new investment advisory agreement, on behalf of their Fund, between Nationwide Fund Advisors (formerly “Gartmore Mutual Fund Capital Trust”) (the “Adviser”) and Nationwide Variable Insurance Trust (formerly “Gartmore Variable Insurance Trust”) (the “Trust”).
Number of Shares | ||||||
Fund | Cast/Not Cast | Percentages | ||||
Federated NVIT High Income Bond Fund (Formerly Federated GVIT High Income Bond Fund) | FOR AGAINST ABSTAIN TOTAL | 30,051,703.188 shares 618,245.021 shares 1,813,550.431 shares 32,483,498.640 shares | 92.514% 1.903% 5.583% | |||
NVIT International Index Fund (Formerly GVIT International Index Fund) | FOR AGAINST ABSTAIN TOTAL | 4,322,203.982 shares 2,758.318 shares 135,636.840 shares 4,460,599.140 shares | 96.897% 0.062% 3.041% | |||
NVIT International Value Fund (Formerly GVIT International Value Fund) | FOR AGAINST ABSTAIN TOTAL | 20,032,843.199 shares 333,588.902 shares 1,093,293.879 shares 21,459,725.980 shares | 93.351% 1.554% 5.095% | |||
NVIT Mid Cap Index Fund (Formerly GVIT Mid Cap Index Fund) | FOR AGAINST ABSTAIN TOTAL | 35,380,179.120 shares 631,117.844 shares 1,565,714.306 shares 37,577,011.270 shares | 94.154% 1.679% 4.167% | |||
NVIT S&P 500 Index Fund (Formerly GVIT S&P 500 Index Fund) | FOR AGAINST ABSTAIN TOTAL | 56,119,814.230 shares 666,195.542 shares 1,944,898.888 shares 58,730,908,660 shares | 95.554% 1.134% 3.312% | |||
Nationwide Multi-Manager NVIT Small Cap Growth Fund (Formerly GVIT Small Cap Growth Fund) | FOR AGAINST ABSTAIN TOTAL | 7,632,918.513 shares 149,458.111 shares 451,583.036 shares 8,233,959.660 shares | 92.700% 1.816% 5.484% | |||
Nationwide Multi-Manager NVIT Small Cap Value Fund (Formerly GVIT Small Cap Value Fund) | FOR AGAINST ABSTAIN TOTAL | 48,649,396.525 shares 979,183.753 shares 2,786,133.102 shares 52,414,713.380 shares | 92.816% 1.868% 5.316% | |||
Nationwide Multi-Manager NVIT Small Company Fund (Formerly GVIT Small Company Fund) | FOR AGAINST ABSTAIN TOTAL | 29,903,181.700 shares 838,774.923 shares 2,006,741.307 shares 32,748,697.930 shares | 91.311% 2.561% 6.128% | |||
Gartmore NVIT Developing Markets Fund (Formerly Gartmore GVIT Developing Markets Fund) | FOR AGAINST ABSTAIN TOTAL | 21,0177,889.443 shares 424,272.958 shares 1,543,850.729 shares 23,046,013.130 shares | 91.460% 1.841% 6.699% | |||
Number of Shares | ||||||
Fund | Cast/Not Cast | Percentages | ||||
Gartmore NVIT Emerging Markets Fund (Formerly Gartmore GVIT Emerging Markets Fund) | FOR AGAINST ABSTAIN TOTAL | 17,050,534.593 shares 526,574.722 shares 881,608.905 shares 18,458,718.220 shares | 92.371% 2.853% 4.776% | |||
Nationwide NVIT Global Financial Services Fund (Formerly Gartmore GVIT Global Financial Services Fund) | FOR AGAINST ABSTAIN TOTAL | 1,554,847.333 shares 19,539.033 shares 52,206.494 shares 1,626,592.860 shares | 95.589% 1.201% 3.210% | |||
Nationwide NVIT Global Health Sciences Fund (Formerly Gartmore GVIT Global Health Sciences Fund) | FOR AGAINST ABSTAIN TOTAL | 4,722,963.678 shares 157,979.030 shares 207,642.222 shares 5,088,584.930 shares | 92.815% 3.104% 4.081% | |||
Nationwide NVIT Global Technology and Communications Fund (Formerly Gartmore GVIT Global Technology and Communications Fund) | FOR AGAINST ABSTAIN TOTAL | 8,585,472.039 shares 102,267.977 shares 489,577.634 shares 9,177,317.650 shares | 93.551% 1.114% 5.335% | |||
Gartmore NVIT Global Utilities Fund (Formerly Gartmore GVIT Global Utilities Fund) | FOR AGAINST ABSTAIN TOTAL | 4,123,270.549 shares 122,001.533 shares 240,276.088 shares 4,485,548.170 shares | 91.923% 2.720% 5.357% | |||
Nationwide NVIT Government Bond Fund (Formerly Gartmore GVIT Government Bond Fund) | FOR AGAINST ABSTAIN TOTAL | 88,471,567.462 shares 1,825,645.181 shares 5,841,990.727 shares 96,139,203.370 shares | 92.024% 1.899% 6.077% | |||
Nationwide NVIT Growth Fund (Formerly Gartmore GVIT Growth Fund) | FOR AGAINST ABSTAIN TOTAL | 14,931,435.904 shares 409,826.402 shares 1,259,945.064 shares 16,601,207.370 shares | 89.942% 2.469% 7.589% | |||
Gartmore NVIT International Growth Fund (Formerly Gartmore GVIT International Growth Fund) | FOR AGAINST ABSTAIN TOTAL | 6,251,419.070 shares 139,618.548 shares 290,025.592 shares 6,681,063.210 shares | 93.569% 2.090% 4.341% | |||
Nationwide NVIT Investor Destinations Aggressive Fund (Formerly Gartmore GVIT Investor Destinations Aggressive Fund) | FOR AGAINST ABSTAIN TOTAL | 49,489,224.549 shares 1,385,396.474 shares 3,696,272.337 shares 54,570,893.360 shares | 90.688% 2.539% 6.773% | |||
Nationwide NVIT Investor Destinations Conservative Fund (Formerly Gartmore GVIT Investor Destinations Conservative Fund) | FOR AGAINST ABSTAIN TOTAL | 23,091,965.887 shares 314,935,884 shares 2,292,355.179 shares 25,699,256.950 shares | 89.855% 1.225% 8.920% | |||
Nationwide NVIT Investor Destinations Moderate Fund (Formerly Gartmore GVIT Investor Destinations Moderate Fund) | FOR AGAINST ABSTAIN TOTAL | 188,902,093.059 shares 3,018,924.590 shares 16,359,690.401 shares 208,280,708.050 shares | 90.696% 1.449% 7.855% | |||
Number of Shares | ||||||
Fund | Cast/Not Cast | Percentages | ||||
Nationwide NVIT Investor Destinations Moderately Aggressive Fund (Formerly Gartmore GVIT Investor Destinations Moderately Aggressive Fund) | FOR AGAINST ABSTAIN TOTAL | 134,792,622.920 shares 3,489,207.264 shares 9,304,197.656 shares 147,586,027.840 shares | 91.332% 2.364% 6.304% | |||
Nationwide NVIT Investor Destinations Moderately Conservative Fund (Formerly Gartmore GVIT Investor Destinations Moderately Conservative Fund) | FOR AGAINST ABSTAIN TOTAL | 49,627,123.216 shares 856,088.634 shares 3,507,215.650 shares 53,990,427.500 shares | 91.918% 1.586% 6.496% | |||
Nationwide NVIT Mid Cap Growth Fund (Formerly Gartmore GVIT Mid Cap Growth Fund) | FOR AGAINST ABSTAIN TOTAL | 10,879,584.971 shares 352,594.958 shares 717,792.971 shares 11,949,972.900 shares | 91.043% 2.950% 6.007% | |||
Nationwide NVIT Money Market Fund II (Formerly Gartmore GVIT Money Market Fund II) | FOR AGAINST ABSTAIN TOTAL | 221,774,863.241 shares 12,322,482.494 shares 16,471,740.875 shares 250,569,086.610 shares | 88.508% 4.918% 6.574% | |||
Nationwide NVIT Money Market Fund (Formerly Gartmore GVIT Money Market Fund) | FOR AGAINST ABSTAIN TOTAL | 1,578,331,008.328 shares 32,372,133.671 shares 112,652,123.301 shares 1,723,355,265.300 shares | 91.585% 1.878% 6.537% | |||
NVIT Nationwide Fund (Formerly Gartmore GVIT Nationwide Fund) | FOR AGAINST ABSTAIN TOTAL | 125,423,274.735 shares 2,767,979.467 shares 8,762,255.828 shares 136,953,510.030 shares | 91.581% 2.021% 6.398% | |||
NVIT Nationwide Leaders Fund (Formerly Gartmore GVIT Nationwide Leaders Fund) | FOR AGAINST ABSTAIN TOTAL | 2,298,504.956 shares 29,630.469 shares 71,637.755 shares 2,399,773.180 shares | 95.780 1.235% 2.985% | |||
Nationwide NVIT U.S. Growth Leaders Fund (Formerly Gartmore GVIT U.S. Growth Leaders Fund) | FOR AGAINST ABSTAIN TOTAL | 4,972,094.773 shares 122,623.161 shares 174,625.606 shares 5,269,343.540 shares | 94.359 2.327% 3.314% | |||
Gartmore NVIT Worldwide Leaders Fund (Formerly Gartmore GVIT Worldwide Leaders Fund) | FOR AGAINST ABSTAIN TOTAL | 2,666,862.487 shares 47,702.491 shares 2,833,284.860 shares 118,719.882 shares | 94.126% 1.684% 4.190% | |||
J.P. Morgan NVIT Balanced Fund (Formerly J.P. Morgan GVIT Balanced Fund) | FOR AGAINST ABSTAIN TOTAL | 15,966,867.546 shares 259,004.324 shares 1,339,385.200 shares 17,565,257.070 shares | 90.900% 1.475% 7.625% | |||
Number of Shares | ||||||
Fund | Cast/Not Cast | Percentages | ||||
Van Kampen NVIT Comstock Value Fund (Formerly Van Kampen GVIT Comstock Value Fund) | FOR AGAINST ABSTAIN TOTAL | 27,737,008.009 shares 502,564.164 shares 1,824,670.107 shares 30,064,242.280 shares | 92.259% 1.672% 6.069% | |||
Van Kampen NVIT Multi Sector Bond Fund (Formerly Van Kampen GVIT Multi Sector Bond Fund) | FOR AGAINST ABSTAIN TOTAL | 21,253,297.665 shares 484,100.920 shares 1,803,963.645 shares 23,541,362.230 shares | 90.281% 2.056% 7.663% | |||
At the April 25 Meeting, shareholders of the Nationwide NVIT Mid Cap Growth Fund were also asked to approve a new investment subadvisory agreement among the Adviser, the Trust and NorthPointe Capital LLC. The voting results with respect to that proposal are set forth below:
Proposal 2
Number of Shares | ||||||
Fund | Cast/Not Cast | Percentages | ||||
Nationwide NVIT Mid Cap Growth Fund (Formerly Gartmore GVIT Mid Cap Growth Fund) | FOR AGAINST ABSTAIN TOTAL | 10,862,827.499 shares 414,574.660 shares 672,570.741 shares 11,949,972.900 shares | 90.903% 3.469% 5.628% | |||
* | This meeting was previously adjourned on April 23, 2007. | |
** | Fund names were changed effective May 1, 2007 to reflect “Nationwide”/ “NVIT” branding to coincide with the sale of Nationwide Fund Advisors, Inc. by Nationwide Corporation to its majority-owned subsidiary, Nationwide Financial Services, Inc. |
June 30, 2007 (Unaudited)
Contents | ||
6 | Statement of Investments | |
10 | Statement of Assets and Liabilities | |
11 | Statement of Operations | |
12 | Statements of Changes in Net Assets | |
13 | Financial Highlights | |
14 | Notes to Financial Statements |
Statement Regarding Availability of Proxy Voting Record.
SAR-ENH (8/07) | ![]() |
Dear Fellow Shareholder:
Since I last wrote to you, our mutual funds have enjoyed another period of solid performance, and the corporate realignment that was in progress is now finished.
On May 1, 2007, Nationwide Financial Services, Inc. (NFS), completed its acquisition of the Philadelphia-based retail mutual fund operations of NWD Investment Management, Inc. (formerly, “Gartmore Global Investments, Inc.”), from Nationwide Corporation, a subsidiary of Nationwide Mutual Insurance Company. Effective that date, the acquired entities were renamed Nationwide Funds Group (NFG), and the Gartmore Funds were renamed the Nationwide Funds to better align with the Nationwide® brand. Although the corporate ownership and fund names have changed, I can assure you that NFG intends to maintain as much continuity as possible with the Funds and key personnel.
Thank you, shareholders, for approving the new investment advisory agreement that was required due to the change in corporate ownership. The new agreement is identical in all material respects to the original agreement that it replaces, with the exception of the section pertaining to the vote by the shareholders of the NVIT Mid Cap Growth Fund to approve NorthPointe Capital®, LLC (NorthPointe) as sub-adviser to that particular Fund.
Market Overview: January 1-June 30, 2007
Share prices in general were buoyed in part by better-than-expected first-quarter 2007 earnings and a flurry of mergers and acquisitions, many of these spurred by readily available funding from private equity firms. In June, investors grew more cautious amid surging crude oil prices, a sudden spike in long-term interest rates, and the meltdown of two hedge funds that had exposure to the subprime mortgage market. Looking abroad, a weak U.S. dollar aided foreign stocks, as reflected in the 11.09% advance of the Morgan Stanley Capital International Europe, Australasia and Far East (MSCI EAFE®) Index. Emerging market performance was particularly robust.
The bond market struggled during the first half of 2007. While short-term interest rates remained stable, reflecting the Federal Reserve Board’s decision in June to leave the target federal funds rate at 5.25%, longer-term rates climbed during the first half of 2007, depressing bond prices and forcing the Lehman Brothers® U.S. Aggregate Index to settle for a modest 0.97% return.
We at NFG thank you for your understanding and cooperation throughout our recent transition period. We emerge from this period energized for the future, and we look forward to serving your investment needs for a long time to come.
Market index performance is provided by a third-party source Nationwide Funds Group deems to be reliable. Indexes are unmanaged and have been provided for illustrative purposes only. No fees or expenses are reflected. Individuals cannot invest directly in an index.
PAST PERFORMANCE IS NO GUARANTEE OF FUTURE RESULTS
Nationwide Funds are advised by Nationwide Fund Advisors (NFA). NFA is a wholly-owned subsidiary of Nationwide Financial Services. Nationwide Financial Services is a wholly-owned subsidiary of Nationwide Corporation. All of the common stock of Nationwide Corporation is held by Nationwide Mutual (95.2%) and Nationwide Mutual Fire Insurance Company (4.8%), each of which is a mutual company owned by its policyholders.
Nationwide Funds Group (NFG) is the mutual fund arm of Nationwide Financial Services (NYSE: NFS). Based in Conshohocken Pa., a suburb of Philadelphia, NFG is comprised of Nationwide Fund Advisors, Nationwide Fund Distributors, LLC, and Nationwide Fund Management, LLC. Together, these provide advisory, distribution, and administration services respectively to the Nationwide Funds, and manage more than $43.5 billion in assets as of June 30, 2007, of which more than $12 billion are in “fund of funds” designed to provide asset allocation across several types of investments and asset classes.
Lehman Brothers (LB) U.S. Aggregate Index: An unmanaged, market value-weighted index of investment-grade, fixed-rate debt issues (including government, corporate, asset-backed, and mortgage-backed securities with maturities of one year or more) that is generally representative of the bond market as a whole.
Morgan Stanley Capital International Europe, Australasia and Far East (MSCI EAFE®) Index: An unmanaged, free float-adjusted, market capitalization-weighted index that is designed to measure the performance of stocks in developed markets outside the United States and Canada.
Standard & Poor’s 500® (S&P 500) Index: An unmanaged, market capitalization-weighted index of 500 widely held stocks of large-cap U.S. companies that gives a broad look at how the stock prices of those companies have performed.
Views expressed within are those of Nationwide Funds Group as of the date noted, are subject to change at any time, and may not come to pass.
This report is for informational purposes only, and is not intended as an offer or recommendation with respect to the purchase or sale of any security, option, future, or other derivatives in such securities.
Investing in mutual funds involves risk, including possible loss of principal.
Investors should carefully consider a fund’s investment objectives, risks, fees, charges, and expenses before investing any money. To obtain this and other fund information, please call 800-848-0920 to request a prospectus, or download a prospectus at www.nationwidefunds.com. Please read the prospectus carefully before investing any money.
Nationwide Funds distributed by Nationwide Fund Distributors LLC (formerly Gartmore Distribution Services, Inc.), Member NASD. 1200 River Road, Suite 1000, Conshohocken, Pa. 19428.
As a shareholder of the Fund, you incur two types of costs: (1) transaction costs, including sales charges (loads) paid on purchase payments and redemption fees; and (2) ongoing costs, including investment advisory fees, administration fees, distribution fees and other Fund expenses. The examples below are 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. Per SEC requirements, the examples assume that you had a $1,000 investment in the Class at the beginning of the reporting period, April 20, 2007, and continued to hold your shares at the end of the reporting period, June 30, 2007.
Actual Expenses
Hypothetical Example for Comparison Purposes
Please note that the expenses shown in the table are meant to highlight your ongoing costs only and do not reflect any transaction costs, such as sales charges (loads) or redemption fees. Therefore, the second line for each Class in 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 transaction costs were included, your costs would have been higher. The examples also assume all dividends and distributions have been reinvested.
Schedule of Shareholder Expenses
Beginning | Ending | |||||||||||||||||||||
Account Value, | Account Value, | Expenses Paid | Annualized | |||||||||||||||||||
NVIT Enhanced Income Fund | 04/20/07 | 06/30/07 | During Period* | Expense Ratio** | ||||||||||||||||||
Class ID | Actual | $ | 1,000.00 | $ | 1,007.90 | $ | 0.90 | 0.45% | ||||||||||||||
Hypothetical | 1 | $ | 1,000.00 | $ | 1,009.10 | $ | 0.90 | 0.45% | ||||||||||||||
* | Expenses are equal to the Fund’s annualized expense ratio multiplied by the average account value over the period multiplied by 73/365 (to reflect the period of operations). The expenses reported above do not include the effect of additional expenses imposed by variable annuity contracts. | |
** | Information shown reflects values using the expense ratios from April 20, 2007 (commencement of operations) to June 30, 2007 and has been annualized to reflect for the period from April 20, 2007 to June 30, 2007, in accordance with SEC guidelines. | |
1 | Represents the hypothetical 5% return before expenses. |
Asset Allocation | ||||
Asset-Backed Securities | 46.7% | |||
Corporate Bonds | 17.0% | |||
Commercial Mortgage Backed Securities | 16.1% | |||
U.S. Government Sponsored & Agency Obligations | 13.1% | |||
Repurchase Agreements | 3.8% | |||
U.S. Treasury Notes | 2.8% | |||
Other assets in excess of liabilities | 0.5% | |||
100.0% |
Top Industries | ||||
Auto Loans | 18.1% | |||
Credit Card Loans | 15.5% | |||
Diversified Financial Services | 13.4% | |||
Electric Utilities | 6.1% | |||
Mortgage-Backed | 4.7% | |||
Equipment Loans | 2.3% | |||
Consumer Finance | 1.3% | |||
Manufacturing | 1.2% | |||
Electric Power | 1.1% | |||
Other | 36.3% | |||
100.0% |
Top Holdings* | ||||
MBNA Corp., 5.63%, 11/30/07 | 2.3% | |||
Citibank Credit Card Issuance Trust, Series 04-A4, Class A4, 3.20%, 08/24/09 | 2.2% | |||
Goldman Sachs Group, Inc., 4.13%, 01/15/08 | 2.2% | |||
Citibank Credit Card Issuance Trust, Series 2000-A3, Class A3, 6.88%, 11/16/09 | 1.9% | |||
Peco Energy Transition Trust, Series 1999-A, Class A7, 6.13%, 03/01/09 | 1.9% | |||
Chase Issuance Trust, Series 2004-A9, Class A9, 3.22%, 06/15/10 | 1.9% | |||
Nomura Asset Securities Corp., Series 1998-D6, Class A1B, 6.59%, 03/15/30 | 1.8% | |||
MBNA Credit Card Master Note Trust, Series 2005-A1 Class A1, 4.20%, 09/15/10 | 1.8% | |||
Household Automotive Trust, Series 2005-3, Class A3, 4.80%, 10/18/10 | 1.7% | |||
Capital Auto Receivables Asset Trust, Series 2003-3, Class A4A, 3.40%, 08/15/08 | 1.7% | |||
Other | 80.6% | |||
100.0% |
* | For purpose of listing top holdings, repurchase agreements are included as part of Other. |
NVIT Enhanced Income
Asset-Backed Securities (46.7%) | |||||||||
Principal | |||||||||
Amount | Value | ||||||||
Auto Loans (18.1%) | |||||||||
Americredit Automobile Receivables Trust, Series 2005-CF, Class A3, 4.47%, 05/06/10 | $ | 2,417,408 | $ | 2,410,418 | |||||
BMW Vehicle Owner Trust, Series 2005-A, Class A3, 4.04%, 02/25/09 | 842,734 | 840,623 | |||||||
Capital Auto Receivables Asset Trust, Series 2003-3, Class A4A, 3.40%, 08/15/08 | 3,457,285 | 3,455,105 | |||||||
Capital One Auto Finance Trust Series 2005-D, Class A3 4.81%, 03/15/10 | 3,200,000 | 3,194,058 | |||||||
Series 2006-C, Class A3A 5.07%, 07/15/11 | 2,759,000 | 2,749,317 | |||||||
Daimler Chrysler Auto Trust, Series 2005-B, Class A3, 4.04%, 09/08/09 | 2,341,005 | 2,330,306 | |||||||
DaimlerChrysler Auto Trust, Series 2004-A, Class A4, 2.58%, 04/08/09 | 2,143,449 | 2,131,318 | |||||||
Ford Credit Auto Owner Trust, Series 2005-A, Class A3, 3.48%, 11/15/08 | 493,607 | 492,275 | |||||||
Honda Auto Receivables Owner Trust, Series 2004-3, Class A3, 2.91%, 10/20/08 | 565,080 | 562,489 | |||||||
Honda Auto Receivables Owner Trust, 5.41%, 11/23/09 | 2,000,000 | 2,000,313 | |||||||
Household Automotive Trust, Series 2005-3, Class A3, 4.80%, 10/18/10 | 3,478,374 | 3,466,927 | |||||||
Nissan Auto Receivables Owner Trust Series 2004-B, Class A3 3.35%, 05/15/08 | 245,891 | 245,615 | |||||||
Series 2006-B, Class A2 5.18%, 08/15/08 | 938,248 | 938,493 | |||||||
4.74%, 09/15/09 | 2,500,000 | 2,489,807 | |||||||
Onyx Acceptance Auto Trust, Series 2004-A, Class A4, 2.94%, 12/15/10 | 1,425,469 | 1,408,887 | |||||||
USAA Auto Owner Trust Series 2004-3, Class A3 3.16%, 02/17/09 | 513,154 | 512,139 | |||||||
Series 2006-2, Class A2 5.31%, 03/16/09 | 1,588,912 | 1,589,583 | |||||||
Wachovia Auto Owner Trust, 5.35%, 02/22/11 | 2,500,000 | 2,500,561 | |||||||
WFS Financial Owner Trust, Series 2005-2, Class A4, 4.39%, 11/19/12 | 2,738,001 | 2,714,779 | |||||||
36,033,013 | |||||||||
Credit Card Loans (15.5%) | |||||||||
Bank One Issuance Trust, Series 2002-A3, Class A3, Series 2002-A3, Class A3, 3.59%, 05/17/10 | 3,338,000 | 3,326,135 | |||||||
Bank One Issuance Trust, Series 2003-A7, Class A7, Series 2003-A7, Class A7, 3.35%, 03/15/11 | 2,759,000 | 2,706,719 | |||||||
Capital One Master Trust, 6.31%, 06/15/11 | 2,500,000 | 2,518,919 | |||||||
Capital One Multi-Asset Execution Trust, Series 03-A4, Class A4, Series 03-C4, Class C4, 3.65%, 07/15/11 | 2,830,001 | 2,774,880 | |||||||
Chase Issuance Trust, Series 2004-A9, Class A9, 3.22%, 06/15/10 | 3,765,000 | 3,742,844 | |||||||
Citibank Credit Card Issuance Trust Series 04-A4, Class A4 3.20%, 08/24/09 | 4,413,999 | 4,401,807 | |||||||
Series 2000-A3, Class A3 6.88%, 11/16/09 | 3,861,999 | 3,884,131 | |||||||
MBNA Credit Card Master Note Trust Series 2005-A1 Class A1 | |||||||||
4.20%, 09/15/10 | 3,633,001 | 3,602,098 | |||||||
2.75%, 10/15/10 | 2,500,000 | 2,445,334 | |||||||
MBNA Credit Card Master Note Trust, Series 03-A1, Class A1, 3.30%, 07/15/10 | 1,500,000 | 1,481,494 | |||||||
30,884,361 | |||||||||
Asset-Backed Securities (continued) | |||||||||
Principal | |||||||||
Amount | Value | ||||||||
Electric Utilities (6.1%) | |||||||||
Massachusetts RRB Special Purpose Trust, Series 1999-1, Class A4, 6.91%, 09/15/09 | $ | 984,299 | $ | 987,320 | |||||
Peco Energy Transition Trust, Series 1999-A, Class A7, 6.13%, 03/01/09 | 3,861,999 | 3,877,351 | |||||||
PP&L Transition Bond Company LLC, 7.15%, 06/25/09 | 2,463,117 | 2,500,611 | |||||||
Public Service New Hampshire Funding LLC, Series 2001-1 Class A2, 5.73%, 11/01/10 | 1,853,749 | 1,858,702 | |||||||
Texas Electric Delivery Transition Bond Co. LLC, Series 2004-1, Class A1, 3.52%, 11/15/11 | 3,065,276 | 3,001,122 | |||||||
12,225,106 | |||||||||
Equipment Loans (2.3%) | |||||||||
CIT Equipment Collateral, Series 2006-VT1, Class A2, 5.13%, 03/20/08 | 690,102 | 690,175 | |||||||
John Deere Owner Trust, Series 2005-A, Class A3, 3.98%, 06/15/09 | 1,125,724 | 1,119,601 | |||||||
MBNA Practice Solutions Owner Trust (a) | |||||||||
Series 2005-2, Class A2 | |||||||||
4.10%, 05/15/09 | 1,303,560 | 1,299,552 | |||||||
4.34%, 06/15/11 (a) | 1,500,000 | 1,476,642 | |||||||
4,585,970 | |||||||||
Mortgage-Backed (4.7%) | |||||||||
Chase Funding Mortgage Loan | |||||||||
Series 2003-6, Class 1A3 3.34%, 05/25/26 | 992,979 | 981,818 | |||||||
Series 2004-2, Class 1A3 4.21%, 09/25/26 | 303,766 | 301,703 | |||||||
Series 2003-3, Class 1A4 3.30%, 11/25/29 | 996,166 | 981,347 | |||||||
Citigroup Residential Mortgage Securities, Series 2006-A1, Class A3-A4, 5.96%, 07/25/36 | 1,754,554 | 1,751,383 | |||||||
Countrywide Asset-Backed Certificates, Series 2005-7, Class AF2, 4.37%, 11/25/35 | 2,193,716 | 2,178,072 | |||||||
Popular ABS Mortgage Pass-Through Trust | |||||||||
Series 2005-4, Class AF1 (b) 5.46%, 09/25/35 | 313,532 | 313,662 | |||||||
Series 2005-5, Class AV2A (b) 5.45%, 11/25/35 | 724,849 | 724,977 | |||||||
Series 2005-D, Class AF1 5.36%, 01/25/36 | 918,970 | 914,885 | |||||||
Residential Asset Mortgage Products, Inc., Series 2003-RS11, Class AI5, 5.00%, 03/25/31 | 167,862 | 167,108 | |||||||
Residential Funding Mortgage Securities I, Series 2004-HS1, Class AI3, 2.68%, 01/25/19 | 453,204 | 448,402 | |||||||
Residential Funding Mortgage Securities I, Class A1, Series 2003-S11, Class A1, 2.50%, 06/25/18 | 620,695 | 597,737 | |||||||
9,361,094 | |||||||||
Total Asset-Backed Securities (Cost $93,143,317) | 93,089,544 | ||||||||
Corporate Bonds (17.0%) | |||||||||
Consumer Finance (1.3%) | |||||||||
HSBC Finance Corp., 6.40%, 06/17/08 | 2,500,000 | 2,521,800 | |||||||
Diversified Financial Services (13.4%) | |||||||||
AIG SunAmerica Global Finance, 5.85%, 08/01/08 (a) | 2,225,000 | 2,234,285 | |||||||
Associates Corp. Of North America, 6.25%, 11/01/08 | 2,500,000 | 2,527,377 | |||||||
Bear Stearns Commercial Mortgage Securities, Inc., 2.88%, 07/02/08 | 2,500,000 | 2,434,813 | |||||||
General Electric Capital Corp., 3.45%, 07/16/07 | 3,310,001 | 3,308,190 | |||||||
Goldman Sachs Group, Inc., 4.13%, 01/15/08 | 4,413,999 | 4,386,354 |
NVIT Enhanced Income (Continued)
Corporate Bonds (continued) | |||||||||
Principal | |||||||||
Amount | Value | ||||||||
Diversified Financial Services (continued) | |||||||||
Lehman Brothers Holdings, Inc., 3.50%, 08/07/08 | $ | 2,500,000 | $ | 2,447,908 | |||||
MBNA Corp., 5.63%, 11/30/07 | 4,469,000 | 4,474,904 | |||||||
Wachovia Corporation, 3.50%, 08/15/08 | 2,500,000 | 2,448,110 | |||||||
Wells Fargo & Co., 3.50%, 04/04/08 | 2,500,000 | 2,463,910 | |||||||
24,291,038 | |||||||||
Electric Power (1.1%) | |||||||||
Alabama Power Company, 3.50%, 11/15/07 | 2,300,999 | 2,283,919 | |||||||
Manufacturing (1.2%) | |||||||||
Hewlett Packard Co., 3.63%, 03/15/08 | 2,500,000 | 2,468,415 | |||||||
Total Corporate Bonds (Cost $34,037,626) | 33,999,984 | ||||||||
Commercial Mortgage Backed Securities (16.1%) | |||||||||
Asset Securitization Corp. | 380,546 | 389,572 | |||||||
Banc of America Commercial Mortgage, Inc. | 1,484,708 | 1,476,501 | |||||||
Bear Stearns Commercial Mortgage Securities, Inc. | |||||||||
Series 2001-TOP2, Class A1 6.08%, 02/15/35 | 405,693 | 408,554 | |||||||
Citigroup Commercial Mortgage Trust | 2,734,374 | 2,685,868 | |||||||
Commercial Mortgage Pass-Through Certification | 2,586,443 | 2,602,941 | |||||||
CS First Boston Mortgage Securities Corp. | 1,698,785 | 1,672,548 | |||||||
GE Capital Commercial Mortgage Corp. | 2,519,167 | 2,489,191 | |||||||
JP Morgan Chase Commercial Mortgage Securities Corp. | 2,095,143 | 2,052,302 | |||||||
LB-UBS Commercial Mortgage Trust | |||||||||
Series: 2000-C5, Class A1 6.41%, 12/15/19 | 1,474,492 | 1,478,545 | |||||||
Series: 2001-C7, Class A2 5.53%, 12/15/25 | 1,219,426 | 1,218,979 | |||||||
Series 2002-C1, Class A2 5.97%, 03/15/26 | 1,266,036 | 1,269,474 | |||||||
Series 2002-C2, Class A2 4.90%, 06/15/26 | 2,450,827 | 2,439,594 | |||||||
Series: 2002-C7, Class A1 3.17%, 12/15/26 | 121,725 | 121,240 | |||||||
Series 2002-C7, Class A2 3.90%, 12/15/26 | 2,226,000 | 2,211,261 | |||||||
Series 2003-C1, Class A1 2.72%, 03/15/27 | 1,572,418 | 1,551,560 | |||||||
Series 2003-C5, Class A2 3.48%, 07/15/27 | 2,759,000 | 2,704,654 | |||||||
Morgan Stanley Dean Witter Capital I | |||||||||
Series 2001-TOP1, Class A3 6.46%, 02/15/33 | 230,813 | 230,985 | |||||||
Series: 2001-TOP5, Class A2 5.90%, 10/15/35 | 313,808 | 313,405 | |||||||
Series 2003-T11, Class A1 3.26%, 06/13/41 | 441,786 | 435,360 | |||||||
Nomura Asset Securities Corp. | 3,652,511 | 3,674,093 | |||||||
Wachovia Bank Commercial Mortgage Trust | |||||||||
Series 2002-C2 Class A1 | |||||||||
3.00%, 11/15/34 | 134,147 | 133,872 | |||||||
4.43%, 03/15/42 | 526,297 | 523,625 | |||||||
Total Commercial Mortgage Backed Securities (Cost $32,087,455) | 32,084,124 | ||||||||
U.S. Government Sponsored & Agency Obligations (13.1%) | |||||||||
Agency Wrapped, Series: T-50, Class A7, 3.55%, 10/27/31 | 1,103,000 | 1,058,426 | |||||||
Federal Home Loan Mortgage Corp. | |||||||||
0.00%, 08/31/07 - 10/15/07 | 6,620,002 | 6,542,727 | |||||||
Pool #E00678 6.50%, 06/01/14 | 85,683 | 87,644 | |||||||
Pool #E00991 6.00%, 07/01/16 | 108,666 | 109,284 | |||||||
Series 2611, Class KC 3.50%, 01/15/17 | 682,997 | 655,713 | |||||||
Series 2664, Class GA 4.50%, 01/15/18 | 731,270 | 716,044 | |||||||
Series 2613, Class PA 3.25%, 05/15/18 | 756,407 | 700,468 | |||||||
Series 2630, Class JA 3.00%, 06/15/18 | 710,280 | 677,628 | |||||||
Series 2928, Class NA 5.00%, 11/15/19 | 1,571,994 | 1,566,342 | |||||||
Series 2682, Class XK 3.00%, 01/15/21 | 849,207 | 842,865 |
U.S. Government Sponsored & Agency Obligations (continued) | |||||||||
Principal | |||||||||
Amount | Value | ||||||||
Series 2726, Class AC 3.75%, 09/15/22 | $ | 379,586 | $ | 377,359 | |||||
Federal National Mortgage Association | |||||||||
0.00%, 09/28/07 | 3,310,001 | 3,268,735 | |||||||
6.50%, 02/01/09 | 31,000 | 31,133 | |||||||
5.50%, 04/01/09 - 02/01/17 | 464,328 | 459,663 | |||||||
Series 2004-34, Class PL 3.50%, 05/25/14 | 1,189,360 | 1,167,994 | |||||||
Pool #253845 | |||||||||
6.00%, 06/01/16 | 136,455 | 137,269 | |||||||
Pool #254089 | |||||||||
6.00%, 12/01/16 | 207,881 | 209,120 | |||||||
Pool #545415 | |||||||||
6.00%, 01/01/17 | 181,664 | 182,747 | |||||||
Pool #625178 | |||||||||
5.50%, 02/01/17 | 390,557 | 386,301 | |||||||
Series 2003-57, Class NB | |||||||||
3.00%, 06/25/18 | 623,000 | 578,347 | |||||||
Series 2003-75, Class NB | |||||||||
3.25%, 08/25/18 | 497,157 | 475,062 | |||||||
Series: 2003-14, Class AN | |||||||||
3.50%, 03/25/33 | 441,261 | 402,980 | |||||||
Government National Mortgage Association | |||||||||
2.21%, 10/16/17 | 2,921,082 | 2,800,904 | |||||||
Series 2004-103, Class A | |||||||||
3.88%, 12/16/19 | 2,714,741 | 2,658,266 | |||||||
Total U.S. Government Sponsored & Agency Obligations (Cost $26,200,361) | 26,093,021 | ||||||||
U.S. Treasury Notes (2.8%) | |||||||||
US Treasuries | |||||||||
4.88%, 08/31/08 | 2,759,000 | 2,754,691 | |||||||
4.63%, 09/30/08 | 2,759,000 | 2,746,714 | |||||||
Total U.S. Treasury Notes (Cost $5,513,383) | 5,501,405 | ||||||||
Repurchase Agreements (3.8%) | |||||||||
Nomura Securities, 5.20% dated 06/29/07, due 07/02/07, repurchase price $7,656,570.41, collateralized by U.S. Government Agency Mortgages with a market value of $7,806,319.08 | 7,653,254 | 7,653,254 | |||||||
Total Investments (Cost $198,635,396) (c) — 99.5% | 198,421,333 | ||||||||
Other assets in excess of liabilities — 0.5% | 958,823 | ||||||||
NET ASSETS — 100.0% | $ | 199,380,156 | |||||||
(a) | Denotes a restricted security that may be resold without restriction to “qualified institutional buyers” as defined by Rule 144A under the Securities Act of 1933 and that the Fund has determined to be liquid under criteria established by the Fund’s Board of Trustees. | |
(b) | Variable Rate Security. The rate reflected in the Statement of Investments is the rate in effect on June 30, 2007. The maturity date represents the actual maturity date. | |
(c) | See notes to financial statements for tax unrealized appreciation (depreciation) of securities. |
NVIT Enhanced | ||||||
Income | ||||||
Assets: | ||||||
Investments, at value (cost $190,982,142) | $ | 190,768,079 | ||||
Repurchase agreements, at cost and value | 7,653,254 | |||||
Total Investments | 198,421,333 | |||||
Interest income | 1,046,096 | |||||
Total Assets | 199,467,429 | |||||
Liabilities: | ||||||
Payable for capital shares redeemed | 11,074 | |||||
Accrued expenses and other payables: | ||||||
Investment advisory fees | 45,969 | |||||
Fund administration and transfer agent fees | 13,731 | |||||
Compliance program costs | 848 | |||||
Other | 15,651 | |||||
Total Liabilities | 87,273 | |||||
Net Assets | $ | 199,380,156 | ||||
Represented by: | ||||||
Capital | $ | 199,287,867 | ||||
Accumulated net investment income | 239,348 | |||||
Accumulated net realized gains from investment transactions | 67,004 | |||||
Net unrealized depreciation on investments | (214,063 | ) | ||||
Net Assets | $ | 199,380,156 | ||||
Net Assets: | ||||||
Class ID Shares | $ | 199,380,156 | ||||
Shares outstanding (unlimited number of shares authorized): | ||||||
Class ID Shares | 19,928,787 | |||||
Net asset value and offering price per share (Net assets by class divided by shares outstanding by class, respectively.): | ||||||
Class ID Shares | $ | 10.00 | ||||
10
NVIT Enhanced | |||||
Income | |||||
INVESTMENT INCOME: | |||||
Interest income | $ | 1,973,739 | |||
Total Income | 1,973,739 | ||||
Expenses: | |||||
Investment advisory fees | 131,321 | ||||
Fund administration and transfer agent fees | 27,857 | ||||
Custodian fees | 6,040 | ||||
Trustee fees | 2,330 | ||||
Compliance program costs (Note 3) | 848 | ||||
Other | 11,056 | ||||
Total expenses before reimbursements and earnings credit | 179,452 | ||||
Expenses reimbursed | (11,248 | ) | |||
Earnings credit (Note 6) | (87 | ) | |||
Net Expenses | 168,117 | ||||
Net Investment Income | 1,805,622 | ||||
REALIZED/ UNREALIZED GAINS (LOSSES) FROM INVESTMENTS: | |||||
Net realized gains on investment transactions | 67,004 | ||||
Net change in unrealized depreciation on investments | (214,063 | ) | |||
Net realized/unrealized gains (losses) on investments | (147,059 | ) | |||
CHANGE IN NET ASSETS RESULTING FROM OPERATIONS | $ | 1,658,563 | |||
(a) | For the period from April 20, 2007 (commencement of operations) through June 30, 2007. |
11
NVIT Enhanced | |||||
Income | |||||
FROM INVESTMENT ACTIVITIES: | |||||
Operations: | |||||
Net investment income | $ | 1,805,622 | |||
Net realized gains on investment transactions | 67,004 | ||||
Net change in unrealized depreciation on investments | (214,063 | ) | |||
Change in net assets resulting from operations | 1,658,563 | ||||
Distributions to shareholders from: | |||||
Net investment income: | |||||
Class ID | (1,566,274 | ) | |||
Change in net assets from shareholder distributions | (1,566,274 | ) | |||
Change in net assets from capital transactions | 199,287,867 | ||||
Change in net assets | 199,380,156 | ||||
Net Assets: | |||||
Beginning of period | – | ||||
End of period | $ | 199,380,156 | |||
Accumulated net investment income at end of period | $ | 239,348 | |||
CAPITAL TRANSACTIONS: | |||||
Class ID Shares | |||||
Proceeds from shares issued | $ | 1,000 | |||
Proceeds from in-kind transactions | 197,732,681 | ||||
Dividends reinvested | 1,566,260 | ||||
Cost of shares redeemed(b) | (12,074 | ) | |||
199,287,867 | |||||
Change in net assets from capital transactions | $ | 199,287,867 | |||
SHARE TRANSACTIONS: | |||||
Class ID Shares | |||||
Issued | 100 | ||||
Proceeds from in-kind transactions | 19,773,268 | ||||
Reinvested | 156,626 | ||||
Redeemed | (1,207 | ) | |||
19,928,787 | |||||
Total change in shares | 19,928,787 | ||||
(a) | For the period from April 20, 2007 (commencement of operations) through June 30, 2007. | |
(b) | Includes redemption fees, if any. |
12
Investment Activities | ||||||||||||||||
Net Realized | ||||||||||||||||
and | ||||||||||||||||
Net Asset | Unrealized | Total | ||||||||||||||
Value, | Net | Gains | from | |||||||||||||
Beginning | Investment | (Losses) on | Investment | |||||||||||||
of Period | Income | Investments | Activities | |||||||||||||
Class ID Shares | ||||||||||||||||
For the six months ended June 30, 2007 (Unaudited) (e) | $ | 10.00 | 0.09 | (0.01 | ) | 0.08 | ||||||||||
[Additional columns below]
[Continued from above table, first column(s) repeated]
Distributions | Ratios / Supplemental Data | |||||||||||||||||||||||
Net Assets | Ratio of | |||||||||||||||||||||||
Net | Net Asset | at End of | Expenses to | |||||||||||||||||||||
Investment | Total | Value, End | Total | Period | Average Net | |||||||||||||||||||
Income | Distributions | of Period | Return (a) | (000s) | Assets (b) | |||||||||||||||||||
Class ID Shares | ||||||||||||||||||||||||
For the six months ended June 30, 2007 (Unaudited) (e) | (0.08 | ) | (0.08 | ) | $ | 10.00 | 0.79% | $ | 199,380 | 0.45% | ||||||||||||||
[Additional columns below]
[Continued from above table, first column(s) repeated]
Ratios / Supplemental Data | ||||||||||||||||||
Ratio of Net | ||||||||||||||||||
Ratio of | Investment | |||||||||||||||||
Ratio of Net | Expenses | Income | ||||||||||||||||
Investment | (Prior to | (Prior to | ||||||||||||||||
Income | Reimbursements) | Reimbursements) | ||||||||||||||||
to Average | to Average | to Average | Portfolio | |||||||||||||||
Net Assets (b) | Net Assets (b)(c) | Net Assets (b)(c) | Turnover (d) | |||||||||||||||
Class ID Shares | ||||||||||||||||||
For the six months ended June 30, 2007 (Unaudited) (e) | 0.45% | 0.45% | 0.45% | 17.22% | ||||||||||||||
(a) | Not annualized for periods less than one year. | |
(b) | Annualized for periods less than one year. | |
(c) | During the period, certain fees were waived and/or reimbursed. If such waivers/reimbursements had not occurred, the ratios would have been as indicated. | |
(d) | Portfolio turnover is calculated on the basis of the Fund as a whole without distinguishing among the classes of shares. | |
(e) | For the period from April 20, 2007 (commencement of operations) through June 30, 2007. |
See accompanying notes to financial statements.
1. Organization
Nationwide Variable Insurance Trust (“NVIT” or the “Trust”) is an open-end management investment company, organized under the laws of Delaware by an amended and restated Agreement and Declaration of Trust, dated October 28, 2004, as amended to date. Prior to May 1, 2007, the Trust was named “Gartmore Variable Insurance Trust”. The Trust, originally created under the laws of Massachusetts as a Massachusetts business trust pursuant to a Declaration of Trust dated, as of June 30, 1981, and as subsequently amended, redomesticated as a Delaware Statutory Trust after the close of trading on April 29, 2005, and is registered under the Investment Company Act of 1940, as amended (the “1940 Act”). The redomestication was a change in statutory status and did not affect the operations of the Trust. As of June 30, 2007, the Trust had authorized an unlimited number of shares of beneficial interest, without par value (“shares”). The Trust currently offers shares to life insurance company separate accounts to fund the benefits under variable life insurance or annuity policies. To date, only the separate accounts of Nationwide Life Insurance Company and Nationwide Life and Annuity Insurance Company (collectively, “Nationwide”) have purchased shares of the NVIT Enhanced Income Fund (the “Fund”), (formerly, “GVIT Enhanced Income Fund”). The Trust currently operates forty (40) separate series, or mutual funds, each with its own investment objectives and strategies. This report contains the financial statements and financial highlights of the Fund.
2. Summary of Significant Accounting Policies
The following is a summary of significant accounting policies followed by the Fund in the preparation of its financial statements. The policies are in conformity with accounting principles generally accepted in the United States of America (“GAAP”). The preparation of financial statements requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of income and expenses for the period. Actual results could differ from those estimates.
(a) | Security Valuation |
Securities for which market quotations are readily available are valued at current market value as of “Valuation Time.” Valuation Time is as of the close of regular trading on the New York Stock Exchange (usually 4 p.m. Eastern time). Equity securities are valued at the last quoted sale price or, if there is no sale price, the last quoted bid price provided by an independent pricing service approved by the Trust’s Board of Trustees (“Board of Trustees”). Securities traded on NASDAQ are valued at the NASDAQ official closing price. Prices are taken from the primary market or exchange in which each security trades. Investment companies are valued at net asset value as reported by such company. | |
Most securities listed on a foreign exchange are valued either at fair value (see description below) or at the last sale price at the close of the exchange on which the security is principally traded. Foreign securities, currencies, and other assets and liabilities denominated in foreign currencies are translated into U.S. dollars at the exchange rate of said currencies against the U.S. dollar, as of Valuation Time, as provided by an independent pricing service approved by the Board of Trustees. | |
Debt (including defaulted issues) and other fixed income securities (other than short-term obligations) are valued at the last quoted bid price and/or by using a combination of daily quotes and matrix evaluations provided by an independent pricing service, the use of which has been approved by the Board of Trustees. Short-term debt securities, such as commercial paper and U.S. Treasury Bills having a remaining maturity of 60 days or less at the time of purchase, are considered to be “short-term” and are valued at amortized cost, which approximates market value. | |
Securities for which market quotations are not readily available, or for which an independent pricing service does not provide a value or provides a value that does not represent fair value in the judgment of the Fund’s investment adviser or designee, are valued at fair value under procedures approved by the Board of Trustees. The “Fair Value” of these securities is determined in good faith by taking into account relevant factors and surrounding circumstances. Methods utilized to obtain a “Fair Value” may include the following non-exclusive list of acceptable methods: (i) a |
multiple of earnings; (ii) the discount from market value of a similar, freely traded security; (iii) the yield-to-maturity for debt issues; or (iv) a consolidation of the methods. The Trust’s Valuation & Operations Committee considers a non-exclusive list of factors to arrive at the appropriate method of determining “Fair Value.” For example, fair value determinations are required for securities whose value is affected by a “significant” event that materially affects the value of a domestic or foreign security which occurs subsequent to the time of the close of the principal market on which such domestic or foreign security trades and before the Valuation Time | |
(i.e., a “subsequent event”). Typically, this will involve events occurring after the close of a foreign market on which a security trades and before the next Valuation Time. | |
The Fund values foreign securities at fair value in the circumstances described below. Generally, trading in foreign securities markets is completed each day at various times prior to the Valuation Time. Due to the time differences between the closings of the relevant foreign securities exchanges and the Valuation Time for the Fund, the Fund will fair value its foreign investments when it is determined that the market quotations for the foreign investments either are not readily available or are unreliable and, therefore, do not represent fair value. When the fair value prices are utilized, these prices will attempt to reflect the impact of the U.S. financial markets’ perceptions and trading activities on the Fund’s foreign investments since the last closing prices of the foreign investments were calculated on their primary foreign securities markets or exchanges. For these purposes, the Board of Trustees has determined that movements in relevant indices or other appropriate market indicators, after the close of the foreign securities exchanges, may demonstrate that market quotations are unreliable, and may trigger fair value pricing for certain securities. Consequently, fair valuation of portfolio securities may occur on a daily basis. |
(b) | Repurchase Agreements |
The Fund may enter into repurchase agreements with an entity which is a member of the Federal Reserve System or which is a “primary dealer” (as designated by the Federal Reserve Bank of New York) in U.S. Government obligations. The repurchase price generally equals the price paid by the Fund plus interest negotiated on the basis of current short-term rates, which may be more or less than the rate on the underlying portfolio securities. The seller under a repurchase agreement is required to maintain the value of the collateral held pursuant to the agreement at a market value equal to or greater than the repurchase price (including accrued interest). Collateral subject to repurchase agreements is held by the Fund’s custodian or another qualified sub-custodian or in the Federal Reserve/Treasury book-entry system. If the counterparty defaults and the fair value of the collateral declines, realization of the collateral by the Fund may be delayed or limited. The Fund may transfer uninvested cash balances into a pooled cash account. These balances are invested in one or more repurchase agreements, with the counterparty of Nomura Securities, which is fully collateralized by U.S. Government Agency Mortgages. |
(c) | Futures Contracts |
The Fund may invest in financial futures contracts (“futures contracts”) for the purpose of hedging its existing portfolio securities or securities that the Fund intends to purchase against fluctuations in value caused by changes in prevailing market interest rates or prices. Futures contracts may also be entered into for non-hedging purposes. | |
Upon entering into a futures contract, the Fund is required to pledge to the broker an amount of cash and/or other assets equal to a certain percentage of the contract amount (initial margin deposit). Subsequent payments, known as “variation margin,” are made each day, depending on the daily fluctuations in the fair value/market value of the underlying assets. A gain or loss equal to the daily variation margin is recognized on a daily basis. Futures contracts are valued daily at their last quoted sale price. | |
A “sale” of a futures contract means the creation of a contractual obligation to deliver the securities or foreign currency called for by the contract at a fixed price at a specified time in the future. A “purchase” of a futures contract means the creation of a contractual obligation to acquire the securities or foreign currency at a fixed price at a specified time in the future. |
Should market conditions change unexpectedly, the Fund may not achieve the anticipated benefits of the futures contracts and may realize a loss. The use of futures transactions for hedging purposes involves the risk of imperfect correlation in movements in the price of futures contracts, interest rates, and the value of the underlying hedged assets. |
(d) | Written Options Contracts |
The Fund may write options contracts. A written option obligates the Fund to deliver (written call) or to receive (written put) a specified quantity of an underlying asset at the contract amount upon exercise by the holder of the option. When the Fund writes an option, an amount equal to the premium received by the Fund is recorded as a liability and is subsequently adjusted to the current fair value of the option written. Premiums received from writing options that expire unexercised are treated by the Fund on the expiration date as realized gains from investments. The difference between the premium and the amount paid on effecting a closing purchase transaction, as a realized loss. If a call option is exercised, the premium is added to the proceeds from the sale of the underlying security or currency in determining whether the Fund has realized a gain or loss. If a put option is exercised, the premium reduces the cost basis of the securities purchased by the Fund. Options traded on an exchange are valued at the last quoted sale price, or in the absence of a sale, the bid price provided by an independent pricing service approved by the Board of Trustees. Non-exchange traded options are valued using dealer supplied | |
quotes. The Fund as a writer of an option bears the market risk of an unfavorable change in the price of the security underlying the written option. |
(e) | Mortgage Dollar Rolls |
The Fund may enter into mortgage “dollar rolls” in which the Fund sells mortgage-backed securities for delivery in the current month and simultaneously contracts to repurchase substantially similar (same type, coupon, and maturity) securities on a specified future date. Mortgage dollar rolls may be implemented in the “to be announced” (“TBA”) market and are referred to as TBAs on the Statement of Investments of the Fund. During the roll period, the Fund foregoes principal and interest paid on the mortgage-backed securities. Each mortgage dollar roll is treated as a financing transaction; therefore, any gain or loss is considered unrealized until the roll reaches completion. Risks may arise due to the delayed payment date and the potential inability of counterparties to complete the transaction. Income is generated as consideration for entering into these transactions and is included in interest income on the Statement of Operations. |
(f) | Security Transactions and Investment Income |
Security transactions are accounted for on the date the security is purchased or sold (“trade date”). Securities gains and losses are calculated on the identified cost basis. Interest income is recognized on the accrual basis and includes, where applicable, the amortization or accretion of premium or discount. Dividend income is recorded on the ex-dividend date. |
(g) | Securities Lending |
To generate additional income, the Fund may lend its portfolio securities, up to 33 1/3% of the Fund, to brokers, dealers and other financial institutions provided that (1) the borrower delivers cash or securities as collateral with respect to each new loan of U.S. securities, equal to at least 102% of the value of the portfolio securities loaned, and with respect to each new loan on non-U.S. securities, collateral of at least 105% of the value of the portfolio securities loaned; and (2) at all times thereafter shall require the borrower to mark-to-market the collateral on a daily basis so that the market value of such collateral does not fall below 100% of the value of securities loaned. The Fund receives payments from borrowers equivalent to the dividends and interest that would have been earned on securities loaned while simultaneously seeking to earn income on the investment of cash collateral. There may be risks of delay in recovery of the securities should the borrower of the securities fail financially. Loans will be made, however, only to borrowers deemed by the Fund’s investment adviser to be of good standing and creditworthy under guidelines |
established by the Board of Trustees and when, in judgment of the adviser, the consideration which can be earned currently from these securities loans justifies the attendant risks. Loans are subject to termination by the Fund or the borrower at any time, and, therefore, are not considered to be illiquid investments. JPMorgan Chase Bank serves as custodian for the securities lending program of the Fund. JPMorgan Chase Bank receives a fee based on the value of the collateral received from borrowers. As of June 30, 2007, the Fund did not have securities on loan. |
(h) | Distributions to Shareholders |
The Fund’s dividends from net investment income, if any, are declared and paid quarterly. The Fund’s distributions from net realized capital gains, if any, are declared and distributed at least annually. | |
Dividends and distributions to shareholders are determined in accordance with federal income tax regulations, which may differ from GAAP. These “book/tax” differences are considered either permanent or temporary in nature. In accordance with the American Institute of Certified Public Accountants Statement of Position 93-2, permanent differences (i.e., reclassification of market discounts, foreign exchange gain/loss, paydowns, and distributions from real estate investment trusts) are reclassified within the capital accounts based on their nature for federal income tax purposes; temporary differences do not require reclassification. These reclassifications have no effect upon the net asset value of the Fund. To the extent distributions exceed current and accumulated earnings and profits for federal income tax purposes, these distributions are reported as distributions of paid-in-capital. |
(i) | Federal Income Taxes |
It is the policy of the Fund to qualify or to continue to qualify as a “regulated investment company” by complying with the provisions available to certain investment companies, as defined in Subchapter M of the U.S. Internal Revenue Code, and to make distributions of net investment income and net realized capital gains sufficient to relieve the Fund from all, or substantially all, federal income taxes. | |
As of June 30, 2007, the tax cost of securities and the breakdown of unrealized appreciation (depreciation) for the Fund was as follows: |
Net Unrealized | ||||||||||||||
Tax Cost of | Unrealized | Unrealized | Appreciation | |||||||||||
Securities | Appreciation | Depreciation | (Depreciation) | |||||||||||
$ | 198,635,406 | $ | 75,999 | $ | (290,072 | ) | $ | (214,073 | ) |
(j) | Allocation of Expenses, Income, and Gains and Losses |
Expenses directly attributable to the Fund are charged to the Fund. Expenses not directly attributable to the Fund are allocated proportionately among various or all funds within the Trust. The method used by the Fund for allocating income, fund level expenses, and realized and unrealized gains or losses is based on the fair value of shares outstanding relative to net assets. Under this method, each class of shares participates based on the total net asset value of that class’s shares in proportion to the total net assets of the Fund. Expenses specific to a class (such as Rule 12b-1 and administrative services fees) are charged to that class. |
3. Transactions with Affiliates
Under the terms of the Trust’s Investment Advisory Agreement, Nationwide Fund Advisors (formerly, Gartmore Mutual Fund Capital Trust (“GMF”)) (“NFA” or the “Advisor”) manages the investment of the assets and supervises the daily business affairs of the Fund. NFA is a wholly-owned subsidiary of Nationwide Financial Services (“NFS”). In addition, NFA provides investment management evaluation services in initially selecting and monitoring, on an ongoing basis, the performance of the subadviser. Morley Capital Management, Inc., (“Morley” or the “subadviser”), manages all of the Fund’s investments and has the responsibility for making all investment decisions for the Fund. Morley is an affiliate of NFA.
Under the terms of the Investment Advisory Agreement, the Fund pays the Fund’s adviser an investment advisory fee based on the Fund’s average daily net assets. Additional information regarding investment advisory fees and subadvisory fees for NFA and the subadviser is as follows for the period ended June 30, 2007:
Fee Schedule | Total Fees | |||||
$0 up to $500 million | 0.35% | |||||
$500 million up to $1 billion | 0.34% | |||||
$1 billion up to $3 billion | 0.325% | |||||
$3 billion up to $5 billion | 0.30% | |||||
$5 billion up to $10 billion | 0.285% | |||||
$10 billion and more | 0.275% | |||||
From such fees, pursuant to the subadvisory agreement, NFA paid the subadviser $16,348 for the period ended June 30, 2007.
NFA and the Fund have entered into a written contract (“Expense Limitation Agreement”) that limits operating expenses (excluding any taxes, interest, brokerage fees, Rule 12b-1 fees, short-sale dividend expenses, administrative services fees, other expenses which are capitalized in accordance with generally accepted accounting principles and may exclude other non-routine expenses not incurred in the ordinary course of the Fund’s business) from exceeding 0.45% until at least May 1, 2008.
NFA may request and receive reimbursement from the Fund of the advisory fees waived and other expenses reimbursed by NFA, respectively, pursuant to the Expense Limitation Agreement at a later date not to exceed three years from the fiscal year in which the corresponding reimbursement to the Fund was made, (as described below), if the Fund has reached a sufficient asset size to permit reimbursement to be made without causing the total annual operating expense ratio of the Fund to exceed the limits set forth above. No reimbursement will be made unless: (i) the Fund’s assets exceed $100 million; (ii) the total annual expense ratio of the Class making such reimbursement is less than the limit set forth above; and (iii) the payment of such reimbursement is approved by the Board of Trustees on a quarterly basis. Except as provided for in the Expense Limitation Agreement, reimbursement of amounts previously waived or assumed by NFA is not permitted.
For the period ended June 30, 2007, the cumulative potential reimbursements for all classes of the Fund, based on reimbursements which expire within three years from the fiscal year in which the corresponding reimbursement to the Fund was made for expenses reimbursed by NFA, would be:
Period ended | |
June 30, 2007 | |
$ | 11,248 |
Under the terms of a Fund Administration and Transfer Agency Agreement, Nationwide Fund Management, LLC (formerly, Gartmore Investor Services, Inc. (“GISI”)) (“NFM”), a wholly-owned subsidiary of NFS Distributors, Inc. (“NFSDI”), provides the Fund with various administrative and accounting services for the Fund (prior to May 1, 2007, this service was provided by Gartmore SA Capital Trust (“GSA”)), and serves as Transfer and Dividend Disbursing Agent for the Fund (prior to May 1, 2007, this service was provided by GISI, an indirect subsidiary of GSA). The fees for the services provided under this Agreement are calculated based on the Trust’s average daily net assets according to the fee
Combined Fee Schedule* | ||||||
Up to $1 billion | 0.15 | % | ||||
$1 billion up to $3 billion | 0.10 | % | ||||
$3 billion up to $8 billion | 0.05 | % | ||||
$8 billion up to $10 billion | 0.04 | % | ||||
$10 billion up to $12 billion | 0.02 | % | ||||
$12 billion or more | 0.01 | % | ||||
* | The assets of the Nationwide NVIT Investor Destinations Aggressive Fund, the Nationwide NVIT Investor Destinations Moderately Aggressive Fund, the Nationwide NVIT Investor Destinations Moderate Fund, the Nationwide NVIT Investor Destinations Moderately Conservative Fund, and the Nationwide NVIT Investor Destinations Conservative Fund (collectively, the “Investor Destinations Funds”) are excluded from the Trust asset level amount in order to calculate this asset-based fee. The Investor Destinations Funds do not pay any part of this fee. |
NFA and NFM have entered into agreements with Citi Fund Services Ohio, Inc. (“Citi”), pursuant to which Citi provides sub-administration and sub-transfer agency services, respectively, to the Fund. Effective August 1, 2007, The BISYS Group Inc. was acquired by and became a wholly owned subsidiary of Citi.
Under the terms of a Distribution Plan under Rule 12b-1 of the 1940 Act, Nationwide Fund Distributors, LLC. (formerly, “Gartmore Distribution Services, Inc. (“GDSI”)) (“NFD” or “Distributor”), the Fund’s principal underwriter, is compensated by the Fund for expenses associated with the distribution of the Class II and Class VII shares of the Fund. NFD is a wholly-owned subsidiary of NFSDI. These fees are based on average daily net assets of Class II and Class VII shares of the Fund at an annual rate not to exceed 0.25% for Class II shares and 0.40% for Class VII shares.
Under the terms of an Administrative Services Plan, the Fund may pay fees to servicing organizations, such as broker-dealers, including NFS, and financial institutions, which agree to provide administrative support services to the shareholders of certain classes. These services include, but are not limited, to the following: establishing and maintaining shareholder accounts; processing purchase and redemption transactions; arranging bank wires; performing shareholder sub-accounting; answering inquires regarding the Fund; and other such services. These fees are based on an annual rate of up to 0.25% of the average daily net assets of Class II and Class VII shares of the Fund.
Under the terms of a letter agreement dated September 12, 2006, by and among NFA, the Audit Committee of the Trust and the Trust, the Trust has agreed to reimburse NFA certain costs related to the Fund’s portion of ongoing administration, monitoring and annual (audit) testing of the Trust’s Rule 38a-1 Compliance Program subject to the pre-approval of the Trust’s Audit Committee. For the period ended June 30, 2007, the Fund’s portion of such costs amounted to $848.
4. Investment Transactions
For the period ended June 30, 2007, (excluding short-term securities) the Fund had purchases of $45,121,084 and sales of $32,147,205.
For the period ended June 30, 2007, the Fund had purchases of $2,813,474 of U.S. Government securities.
5. Bank Loans and Earnings Credit
The Trust has a credit agreement with JPMorgan Chase & Co., the Fund’s custodian bank, permitting the Trust to borrow up to $100,000,000. Borrowings under this arrangement bear interest at the Federal Funds rate plus 0.50%. The interest costs, if any, would be included in other fees in the Statement of Operations. No compensating balances were required under the terms of the line of credit. The line of credit is renewed annually, expiring on June 25, 2008, with a
The Trust’s custodian bank has agreed to reduce the bank’s fees (earnings credit) when the Funds of the Trust maintain cash on deposit in non-interest-bearing custody and Demand Deposit Accounts. Earnings credits, if any, are shown as a reduction of total expenses on the Statement of Operations.
6. Indemnifications
Under the Trust’s organizational documents, certain of the Trust’s Officers and Trustees are indemnified against certain liabilities arising out of the performance of their duties to the Trust. In addition, the Trust has entered into Indemnification Agreements with the Trust’s trustees and certain officers covering similar liabilities. Trust Officers receive no compensation from the Trust for serving as the Trust’s Officers. In addition, in the normal course of business, the Trust enters into contracts with its vendors and others that provide for general indemnifications. The Trust’s maximum exposure under these arrangements is unknown, as this would involve future claims that may be made against the Trust. Based on experience, however, the Trust expects that risk of loss to be remote.
7. Recently Issued Accounting Pronouncements
On July 13, 2006, the Financial Accounting Standards Board (“FASB”) released FASB Interpretation No. 48, Accounting for Uncertainty in Income Taxes (“FIN 48”). FIN 48 provides guidance for how uncertain tax positions should be recognized, measured, presented and disclosed in the financial statements. FIN 48 requires the affirmative evaluation of tax positions taken or expected to be taken in the course of preparing the Fund’s tax returns to determine whether it is more-likely-than-not (i.e., greater than 50 percent) that each tax position will be sustained upon examination by a taxing authority based on the technical merits of the position. A tax position that meets the more-likely-than-not recognition threshold is measured to determine the amount of benefit to recognize in the financial statements. Differences between tax positions taken in a tax return and amounts recognized in the financial statements will generally result in an increase in a liability for taxes payable (or a reduction of a tax refund receivable) and an increase in a deferred tax liability (or a reduction in a deferred tax asset). Adoption of FIN 48 was required no later than the last business day of the first financial statement reporting period for fiscal years beginning after December 15, 2006 and is to be applied to all open tax years as of the effective date. Accordingly, the Fund was required to implement FIN 48 in its net asset value per share (NAV) calculation on June 29, 2007. Management has evaluated the implications of FIN 48 and has concluded that there was no impact to the Fund’s financial statements as of June 29, 2007. The adoption of FIN 48 requires ongoing monitoring and analysis, future conclusions reached by management may be different and result in adjustments to the Fund’s NAV and financial statements.
In September 2006, the FASB issued Statement on Financial Accounting Standards (“SFAS”) No. 157, “Fair Value Measurements.” This standard establishes a single authoritative definition of fair value, sets out a framework for measuring fair value and requires additional disclosures about fair value measurements. SFAS No. 157 applies to fair value measurements already required or permitted by existing standards. SFAS No. 157 is effective for financial statements issued for fiscal years beginning after November 15, 2007 and interim periods within those fiscal years. The changes to current accounting principles generally accepted in the United States of America from the application of this Statement relate to the definition of fair value, the methods used to measure fair value, and the expanded disclosures about fair value measurements. As of June 30, 2007, the Fund does not believe the adoption of SFAS No. 157 will impact the financial statement amounts; however, additional disclosures may be required about the inputs used to develop the measurements and the effect of certain of the measurements on changes in net assets for the period.
Trustees who are not Interested Persons (as defined in the 1940 Act) and Officers of the Trust as of June 30, 2007
Number of | ||||||||||
Position(s) Held | Portfolios in the | |||||||||
with the Trust | Principal Occupation(s) | Nationwide Fund | Other | |||||||
Name, Address | and Length of | During Past | Complex Overseen | Directorships | ||||||
and Year of Birth | Time Served1 | Five Years | by Trustee | Held by Trustee2 | ||||||
Charles E. Allen c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1948 | Trustee since July 2000 | Mr. Allen is Chairman, Chief Executive Officer and President of Graimark Realty Advisors, Inc. (real estate development, investment and asset management). | 89 | None | ||||||
Paula H.J. Cholmondeley c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1947 | Trustee since July 2000 | Ms. Cholmondeley was Vice President and General Manager of Sappi Fine Paper North America from April 2000 through December 2003. | 89 | Director of Dentsply International, Inc.(dental products), Ultralife Batteries, Inc., Terex Corporation (construction equipment), Minerals Technology, Inc. (specialty chemicals) and Albany International Corp. (paper industry) | ||||||
C. Brent DeVore3 c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1940 | Trustee since 1990 | Dr. DeVore is President of Otterbein College. | 89 | None | ||||||
Phyllis Kay Dryden c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1947 | Trustee since December 2004 | Ms. Dryden was a partner of Mitchell Madison, a management consulting company from January 2006 until December 2006; she is currently a consultant with the company. Ms. Dryden was formerly Managing Partner of marchFIRST, a global management consulting firm. | 89 | None | ||||||
Barbara L. Hennigar c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1935 | Trustee since July 2000 | Retired. | 89 | None |
Number of | ||||||||||
Position(s) Held | Portfolios in the | |||||||||
with the Trust | Principal Occupation(s) | Nationwide Fund | Other | |||||||
Name, Address | and Length of | During Past | Complex Overseen | Directorships | ||||||
and Year of Birth | Time Served1 | Five Years | by Trustee | Held by Trustee2 | ||||||
Barbara I. Jacobs c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1950 | Trustee since December 2004 | Ms. Jacobs served as Chairman of the Board of Directors of KICAP Network Fund, a European (United Kingdom) hedge fund, from January 2001 through January 2006. From 1998-2003, Ms. Jacobs was also a Managing Director and European Portfolio Manager of CREF Investments (Teachers Insurance and Annuity Association — College Retirement Equities Fund). | 89 | None | ||||||
Douglas F. Kridler c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1955 | Trustee since September 1997 | Mr. Kridler has served as the President and Chief Executive Officer of the Columbus Foundation (a Columbus, OH-based foundation which manages over 1,300 individual endowment funds) since February 2002. Prior to January 31, 2002, Mr. Kridler was the President of the Columbus Association for the Performing Arts and Chairman of the Greater Columbus Convention and Visitors Bureau. | 89 | None | ||||||
Michael D. McCarthy c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1947 | Trustee since December 2004 | Retired. Mr. McCarthy was Chairman of VMAC (commodity swaps) from October 2002 until January 2007; and a partner of Pineville Properties LLC (a commercial real estate development firm) from September 2000 until January 2007. | 89 | None | ||||||
David C. Wetmore c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1948 | Trustee since 1995 and Chairman since February 2005 | Retired. | 89 | None | ||||||
1 | Length of time served includes time served with the Trust’s predecessors. | |
2 | Directorships held in (1) any other investment companies registered under the 1940 Act, (2) any company with a class of securities registered pursuant to Section 12 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or (3) any company subject to the requirements of Section 15(d) of the Exchange Act. | |
3 | Mr. DeVore has served as President of Otterbein College since 1984. Mark Thresher, President and Chief Operating Officer of Nationwide Financial Services, Inc. (“NFS”) has served as a member of the Board of Trustees of Otterbein College since 2000, currently serves as one of 30 of its trustees, and is currently one of two Vice Chairmen of the Board. Each of Nationwide Fund Advisors (“NFA”), the Funds’ investment adviser, and Nationwide Fund Distributors LLC (“NFD”), principal underwriter to the Trust, is a wholly-owned subsidiary of NFS. | |
Additional information regarding the Trustees and Officers may be found in the Trust’s Statement of Additional Information, which is available without charge upon request, by calling 800-848-0920. |
Trustees who are Interested Persons (as defined in the 1940 Act) and/or Officers of the Trust as of June 30, 2007
Number of | ||||||||||
Position(s) Held | Portfolios in the | |||||||||
with the Trust | Principal Occupation(s) | Nationwide Fund | Other | |||||||
Name, Address | and Length of | During Past | Complex Overseen | Directorships | ||||||
and Year of Birth | Time Served1 | Five Years | by Trustee | Held by Trustee2 | ||||||
Arden L. Shisler c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1941 | Trustee since February 2000 | Retired. Mr. Shisler is the former President and Chief Executive Officer of KeB Transport, Inc., a trucking firm (2000 through 2002). He served as a consultant to KeB from January 2003 through December 2004. Since 1992, Mr. Shisler has also been Chairman of the Board for Nationwide Mutual Insurance Company.3 | 89 | Director of Nationwide Financial Services, Inc., Chairman of Nationwide Mutual Insurance Company3 | ||||||
John H. Grady Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1961 | President & Chief Executive Officer since December 2006 | Mr. Grady is President, and Chief Executive Officer of Nationwide Funds Group which includes Nationwide Fund Advisors,3 Nationwide Fund Management LLC,3 Nationwide Fund Distributors LLC 3 and NWD Investments,2 the asset management operations of Nationwide Mutual Insurance Company, which includes Morley Capital Management, Inc.,2 Nationwide Separate Accounts LLC,2 NorthPointe Capital LLC,2 and Nationwide SA Capital Trust2. From March 2004 until March 2006, Mr. Grady was Chief Executive Officer of Constellation Investment Management Co., L.P. (registered investment adviser), and President and Chief Executive Officer of Constellation Funds Group (registered investment companies). He also was President of Constellation Investment Distribution Co., Inc. (registered broker-dealer) from March 2004 until June 2006. From February 2001 until February 2004, Mr. Grady was Chief Operating and Chief Legal Officer; Managing Director, Mutual Funds Group, Turner Investment Partners, Inc. (registered investment adviser); Executive Vice President of Turner Funds and Turner Institutional Portfolios (registered investment companies); and President, Turner Investment Distributors, Inc. (registered broker-dealer). | N/A | None | ||||||
Gerald J. Holland Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken,PA 19428 1951 | Treasurer since March 2001 | Mr. Holland is Senior Vice President — Operations for Nationwide Funds Group3. | N/A | N/A |
Number of | ||||||||||
Position(s) Held | Portfolios in the | |||||||||
with the Trust | Principal Occupation(s) | Nationwide Fund | Other | |||||||
Name, Address | and Length of | During Past | Complex Overseen | Directorships | ||||||
and Year of Birth | Time Served1 | Five Years | by Trustee | Held by Trustee2 | ||||||
Michael A. Krulikowski Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1959 | Chief Compliance Officer from June 2004 to August 20074 | Mr. Krulikowski is Vice President and Chief Compliance Officer of Nationwide Funds Group3, Morley Capital Management, Inc.3 , Nationwide SA Capital Trust (since 1999)3, and Nationwide Separate Accounts LLC (since August 2005).3 Since June 2004, Mr. Krulikowski has also served as Chief Compliance Officer of the Trust. From November 1999 through May 2007, he served as Vice President and Chief Compliance Officer of NorthPointe Capital LLC. 3 | N/A | N/A | ||||||
Eric E. Miller Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1953 | Secretary since December 2002 | Mr. Miller is Senior Vice President, General Counsel, and Assistant Secretary for Nationwide Funds Group3 and NWD Investments.2 From August 2000 to August 2002, Mr. Miller was a Partner with Stradley Ronon Stevens & Young, LLP. | N/A | N/A | ||||||
1 | Length of time served includes time served with the Trust’s predecessors. | |
2 | Directorships held in (1) any other investment companies registered under the 1940 Act, (2) any company with a class of securities registered pursuant to Section 12 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or (3) any company subject to the requirements of Section 15(d) of the Exchange Act. | |
3 | This position is held with an affiliated person or principal underwriter of the Trust. | |
4 | Effective August 3, 2007, the Board of Trustees approved Carol Baldwin Moody as Chief Compliance Officer of the Trust. Since November 2005, Ms. Moody has been Senior Vice President, Chief Compliance Officer of Nationwide Financial Services, Nationwide Life Insurance Company, Nationwide Life and Annuity Insurance Company, and Nationwide Investment Advisors, LLC. From February 2004-November 2005, she was Chief Compliance Officer of TIAA-CREF and from April 2000-February 2004, she was Managing Director and General Counsel, TCW/ Latin America Partners, LLC and Baeza & Co., LLC. | |
Federal law requires the Trust, each of its investment advisers and sub-advisers to adopt procedures for voting proxies (“Proxy Voting Guidelines”) and to provide a summary of those Proxy Voting Guidelines used to vote the securities held by the Funds. The Funds’ proxy voting policies and procedures are available without charge (i) upon request, by calling 800-848-0920, (ii) on the Funds’ website at www.nationwidefunds.com, or (iii) on the Securities and Exchange Commission’s website at www.sec.gov. |
June 30, 2007 (Unaudited)
Contents | ||
7 | Statement of Investments | |
37 | Statement of Assets and Liabilities | |
38 | Statement of Operations | |
39 | Statements of Changes in Net Assets | |
40 | Financial Highlights | |
41 | Notes to Financial Statements |
Statement Regarding Availability of Proxy Voting Record.
SAR-BDX (8/07) | ![]() |
Dear Fellow Shareholder:
Since I last wrote to you, our mutual funds have enjoyed another period of solid performance, and the corporate realignment that was in progress is now finished.
On May 1, 2007, Nationwide Financial Services, Inc. (NFS), completed its acquisition of the Philadelphia-based retail mutual fund operations of NWD Investment Management, Inc. (formerly, “Gartmore Global Investments, Inc.”), from Nationwide Corporation, a subsidiary of Nationwide Mutual Insurance Company. Effective that date, the acquired entities were renamed Nationwide Funds Group (NFG), and the Gartmore Funds were renamed the Nationwide Funds to better align with the Nationwide® brand. Although the corporate ownership and fund names have changed, I can assure you that NFG intends to maintain as much continuity as possible with the Funds and key personnel.
Thank you, shareholders, for approving the new investment advisory agreement that was required due to the change in corporate ownership. The new agreement is identical in all material respects to the original agreement that it replaces, with the exception of the section pertaining to the vote by the shareholders of the NVIT Mid Cap Growth Fund to approve NorthPointe Capital®, LLC (NorthPointe) as sub-adviser to that particular Fund.
Market Overview: January 1-June 30, 2007
Share prices in general were buoyed in part by better-than-expected first-quarter 2007 earnings and a flurry of mergers and acquisitions, many of these spurred by readily available funding from private equity firms. In June, investors grew more cautious amid surging crude oil prices, a sudden spike in long-term interest rates, and the meltdown of two hedge funds that had exposure to the subprime mortgage market. Looking abroad, a weak U.S. dollar aided foreign stocks, as reflected in the 11.09% advance of the Morgan Stanley Capital International Europe, Australasia and Far East (MSCI EAFE®) Index. Emerging market performance was particularly robust.
The bond market struggled during the first half of 2007. While short-term interest rates remained stable, reflecting the Federal Reserve Board’s decision in June to leave the target federal funds rate at 5.25%, longer-term rates climbed during the first half of 2007, depressing bond prices and forcing the Lehman Brothers® U.S. Aggregate Index to settle for a modest 0.97% return.
We at NFG thank you for your understanding and cooperation throughout our recent transition period. We emerge from this period energized for the future, and we look forward to serving your investment needs for a long time to come.
Market index performance is provided by a third-party source Nationwide Funds Group deems to be reliable. Indexes are unmanaged and have been provided for illustrative purposes only. No fees or expenses are reflected. Individuals cannot invest directly in an index.
PAST PERFORMANCE IS NO GUARANTEE OF FUTURE RESULTS
Nationwide Funds are advised by Nationwide Fund Advisors (NFA). NFA is a wholly-owned subsidiary of Nationwide Financial Services. Nationwide Financial Services is a wholly-owned subsidiary of Nationwide Corporation. All of the common stock of Nationwide Corporation is held by Nationwide Mutual (95.2%) and Nationwide Mutual Fire Insurance Company (4.8%), each of which is a mutual company owned by its policyholders.
Nationwide Funds Group (NFG) is the mutual fund arm of Nationwide Financial Services (NYSE: NFS). Based in Conshohocken Pa., a suburb of Philadelphia, NFG is comprised of Nationwide Fund Advisors, Nationwide Fund Distributors, LLC, and Nationwide Fund Management, LLC. Together, these provide advisory, distribution, and administration services respectively to the Nationwide Funds, and manage more than $43.5 billion in assets as of June 30, 2007, of which more than $12 billion are in “fund of funds” designed to provide asset allocation across several types of investments and asset classes.
Lehman Brothers (LB) U.S. Aggregate Index: An unmanaged, market value-weighted index of investment-grade, fixed-rate debt issues (including government, corporate, asset-backed, and mortgage-backed securities with maturities of one year or more) that is generally representative of the bond market as a whole.
Morgan Stanley Capital International Europe, Australasia and Far East (MSCI EAFE®) Index: An unmanaged, free float-adjusted, market capitalization-weighted index that is designed to measure the performance of stocks in developed markets outside the United States and Canada.
Standard & Poor’s 500® (S&P 500) Index: An unmanaged, market capitalization-weighted index of 500 widely held stocks of large-cap U.S. companies that gives a broad look at how the stock prices of those companies have performed.
Views expressed within are those of Nationwide Funds Group as of the date noted, are subject to change at any time, and may not come to pass.
This report is for informational purposes only, and is not intended as an offer or recommendation with respect to the purchase or sale of any security, option, future, or other derivatives in such securities.
Investing in mutual funds involves risk, including possible loss of principal.
Investors should carefully consider a fund’s investment objectives, risks, fees, charges, and expenses before investing any money. To obtain this and other fund information, please call 800-848-0920 to request a prospectus, or download a prospectus at www.nationwidefunds.com. Please read the prospectus carefully before investing any money.
Nationwide Funds distributed by Nationwide Fund Distributors LLC (formerly Gartmore Distribution Services, Inc.), Member NASD. 1200 River Road, Suite 1000, Conshohocken, Pa. 19428.
As a shareholder of the Fund, you incur two types of costs: (1) transaction costs, including sales charges (loads) paid on purchase payments and redemption fees; and (2) ongoing costs, including investment advisory fees, administration fees, distribution fees and other Fund expenses. The examples below are 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. Per SEC requirements, the examples assume that you had a $1,000 investment in the Class at the beginning of the reporting period, April 20, 2007, and continued to hold your shares at the end of the reporting period, June 30, 2007.
Actual Expenses
Hypothetical Example for Comparison Purposes
Please note that the expenses shown in the table are meant to highlight your ongoing costs only and do not reflect any transaction costs, such as sales charges (loads) or redemption fees. Therefore, the second line for each Class in 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 transaction costs were included, your costs would have been higher. The examples also assume all dividends and distributions have been reinvested.
Schedule of Shareholder Expenses
Beginning | Ending | Expenses | ||||||||||||||||||||
Account Value | Account Value | Paid | Annualized | |||||||||||||||||||
NVIT Bond Index Fund | 04/20/07 | 06/30/07 | During Period* | Expense Ratio** | ||||||||||||||||||
Class ID | Actual | $ | 1,000.00 | $ | 991.00 | $ | 0.64 | 0.32% | ||||||||||||||
Hypothetical | 1 | $ | 1,000.00 | $ | 1,009.36 | $ | 0.64 | 0.32% | ||||||||||||||
* | Expenses are equal to the Fund’s annualized expense ratio multiplied by the average account value over the period multiplied by 73/365 (to reflect the period of operations). The expenses reported above do not include the effect of additional expenses imposed by variable annuity contracts. | |
** | Information shown reflects values using the expense ratios from April 20, 2007 (commencement of operations) to June 30, 2007 and has been annualized to reflect for the period from April 20, 2007 to June 30, 2007, in accordance with SEC guidelines. | |
1 | Represents the hypothetical 5% return before expenses. |
Portfolio Summary | NVIT Bond Index Fund |
June 30, 2007 | Long Positions |
Asset Allocation | ||||
U.S. Government Agency Long-Term Obligations | 55.3% | |||
Corporate Bonds | 25.8% | |||
U.S. Treasury Notes | 15.6% | |||
Sovereign Bonds | 3.1% | |||
Yankee Dollars | 2.2% | |||
Asset-Backed Securities | 2.2% | |||
Repurchase Agreements | 1.0% | |||
Mortgage-Backed Obligations | 0.8% | |||
Municipal Bonds | 0.1% | |||
Liabilities in excess of other assets | -6.1% | |||
100.0% |
Top Industries | ||||
Banks | 7.7% | |||
Diversified Financial Services | 5.4% | |||
Other Financial | 4.7% | |||
Service Companies | 2.1% | |||
Manufacturing | 1.8% | |||
Automobiles | 1.7% | |||
Electric Power | 1.4% | |||
Telephones | 1.0% | |||
Energy Companies | 0.9% | |||
Consumer Goods | 0.8% | |||
Other | 72.5% | |||
100% |
Top Holdings* | ||||
U.S. Treasury Notes, 4.75%, 02/15/10 | 4.6% | |||
Federal National Mortgage Association, 5.00%, 11/01/35 | 4.0% | |||
U.S. Treasury Bonds, 6.25%, 08/15/23 | 2.2% | |||
Federal Home Loan Mortgage Corp., Pool #A53632, 6.00%, 10/01/36 | 2.1% | |||
U.S. Treasury Notes, 4.50%, 09/30/11 | 2.0% | |||
Federal Home Loan Mortgage Corp., Pool #A49653, 5.50%, 06/01/36 | 1.8% | |||
Federal Home Loan Mortgage Corp., Pool #G02186, 5.00%, 05/01/36 | 1.3% | |||
Federal National Mortgage Association, 6.63%, 09/15/09 | 1.3% | |||
Federal Home Loan Mortgage Corp., 5.25%, 05/21/09 | 1.2% | |||
U.S. Treasury Notes, 6.38%, 08/15/27 | 1.1% | |||
Other | 78.4% | |||
100.0% |
* | For purpose of listing top holdings, repurchase agreements are included as part of Other. |
Portfolio Summary | NVIT Bond Index Fund |
June 30, 2007 | Short Positions |
The SEC adopted a requirement that Funds present their portfolio holdings in a table, chart or graph format in their annual and semiannual reports to shareholders, whether or not a statement of investments is utilized. The following tables, which present portfolio holdings as a percentage of net assets, are provided in compliance with this requirement.
Asset Allocation | ||||
U.S. Government Agency Long-Term Obligations | 4.3% | |||
4.3% |
Top Holdings | ||||
Federal National Mortgage Association TBA, 5.00%, 07/01/37 | 4.1% | |||
Federal National Mortgage Association TBA, 5.00%, 06/15/37 | 0.2% | |||
4.3% |
NVIT Bond Index
Asset-Backed Securities (2.2%) | |||||||||
Principal | |||||||||
Amount | Value | ||||||||
Auto Loan (0.8%) | |||||||||
Nissan Auto Receivables Owner Trust, 4.74%, 09/15/09 | $ | 11,046,000 | $ | 11,000,961 | |||||
Diversified Financial Services (1.4%) (a) | |||||||||
Aegis Asset Backed Securities Trust, 5.40%, 01/25/37 | 6,690,407 | 6,690,389 | |||||||
Fremont Home Loan Trust, 5.49%, 01/25/36 | 5,680,328 | 5,681,438 | |||||||
Residential Accredit Loans, Inc., 5.50%, 11/25/36 | 8,487,451 | 8,475,789 | |||||||
20,847,616 | |||||||||
Total Asset-Backed Securities (Cost $31,848,803) | 31,848,577 | ||||||||
Corporate Bonds (25.8%) | |||||||||
Aerospace & Defense (0.0%) | |||||||||
General Dynamics Corp., 4.25%, 05/15/13 | 250,000 | 234,122 | |||||||
Airlines (0.0%) | |||||||||
Continental Airlines, Inc. | |||||||||
7.92%, 05/01/10 | 350,000 | 363,563 | |||||||
6.56%, 08/15/13 | 233,000 | 240,281 | |||||||
603,844 | |||||||||
Automobiles (1.7%) | |||||||||
DaimlerChrysler AG | |||||||||
4.05%, 06/04/08 | 649,000 | 639,895 | |||||||
5.88%, 03/15/11 | 2,737,000 | 2,750,970 | |||||||
7.30%, 01/15/12 | 389,000 | 412,569 | |||||||
6.50%, 11/15/13 | 487,000 | 502,971 | |||||||
8.50%, 01/18/31 | 369,000 | 466,301 | |||||||
Ford Credit Auto Owner Trust, 5.42%, 07/15/09 | 11,267,498 | 11,270,408 | |||||||
Honda Auto Receivables Owner Trust, 5.12%, 10/15/10 | 9,424,000 | 9,392,531 | |||||||
25,435,645 | |||||||||
Banks (6.4%) | |||||||||
Bank of America Corp. | |||||||||
3.25%, 08/15/08 | 319,000 | 311,541 | |||||||
4.50%, 08/01/10 | 206,000 | 201,169 | |||||||
4.38%, 12/01/10 | 590,000 | 572,163 | |||||||
5.38%, 08/15/11 | 383,000 | 381,326 | |||||||
4.88%, 09/15/12 | 289,000 | 279,274 | |||||||
4.88%, 01/15/13 | 649,000 | 627,496 | |||||||
4.75%, 08/01/15 | 619,000 | 578,308 | |||||||
5.25%, 12/01/15 | 737,000 | 709,026 | |||||||
6.00%, 06/15/16 | 295,000 | 298,322 | |||||||
5.63%, 10/14/16 | 2,655,000 | 2,613,627 | |||||||
4.84%, 07/10/45 | 2,784,000 | 2,625,708 | |||||||
5.36%, 10/10/45 | 4,070,000 | 3,926,103 | |||||||
Bank of New York Corp., 5.05%, 03/03/09 | 531,000 | 526,804 | |||||||
BB&T Corp. | |||||||||
6.50%, 08/01/11 | 2,242,000 | 2,314,242 | |||||||
4.75%, 10/01/12 | 236,000 | 226,269 | |||||||
Capital One Bank Corp. | |||||||||
5.75%, 09/15/10 | 236,000 | 237,117 | |||||||
5.13%, 02/15/14 | 765,000 | 734,291 | |||||||
Capital One Financial | |||||||||
5.50%, 06/01/15 | 442,000 | 426,647 | |||||||
5.25%, 02/21/17 | 304,000 | 281,753 | |||||||
Citigroup, Inc. | |||||||||
6.38%, 11/15/08 | 162,000 | 164,124 | |||||||
3.63%, 02/09/09 | 838,000 | 816,168 | |||||||
4.13%, 02/22/10 | 531,000 | 515,111 | |||||||
4.63%, 08/03/10 | 324,000 | 317,150 | |||||||
6.50%, 01/18/11 | 133,000 | 137,160 | |||||||
5.13%, 02/14/11 | 88,000 | 86,906 | |||||||
6.00%, 02/21/12 | 147,000 | 149,742 | |||||||
5.25%, 02/27/12 | 1,750,000 | 1,727,252 | |||||||
5.63%, 08/27/12 | 295,000 | 295,063 | |||||||
5.30%, 01/07/16 | 354,000 | 342,152 | |||||||
5.85%, 08/02/16 | 413,000 | 412,992 | |||||||
6.63%, 06/15/32 | 333,000 | 346,935 | |||||||
5.88%, 02/22/33 | 118,000 | 112,083 | |||||||
5.85%, 12/11/34 | 900,000 | 859,803 | |||||||
Comerica, Inc., 4.80%, 05/01/15 | 177,000 | 164,124 | |||||||
Deutsche Bank Financial LLC., 7.50%, 04/25/09 | 100,000 | 103,776 | |||||||
European Investment Bank, 5.13%, 09/13/16 | 350,000 | 344,438 | |||||||
Fifth Third Bank | |||||||||
3.38%, 08/15/08 | 280,000 | 273,649 | |||||||
4.20%, 02/23/10 | 1,018,000 | 989,984 | |||||||
First Union National Bank, 6.14%, 03/15/33 | 3,137,101 | 3,187,540 | |||||||
Golden West Financial Corp., 4.75%, 10/01/12 | 156,000 | 150,576 | |||||||
HSBC Bank USA | |||||||||
3.88%, 09/15/09 | 1,047,000 | 1,014,488 |
NVIT Bond Index (Continued)
Corporate Bonds (continued) | |||||||||
Principal | |||||||||
Amount | Value | ||||||||
Banks (continued) | |||||||||
4.63%, 04/01/14 | $ | 590,000 | $ | 551,175 | |||||
5.88%, 11/01/34 | 717,000 | 682,811 | |||||||
Huntington National Bank, 5.50%, 02/15/16 | 300,000 | 289,408 | |||||||
Inter-American Development Bank | |||||||||
5.00%, 04/05/11 | 350,000 | 348,010 | |||||||
5.13%, 09/13/16 | 585,000 | 572,735 | |||||||
JP Morgan Chase & Co. | |||||||||
6.25%, 01/15/09 | 59,000 | 59,604 | |||||||
3.50%, 03/15/09 | 1,445,000 | 1,401,706 | |||||||
7.88%, 08/01/10 | 59,000 | 63,000 | |||||||
4.50%, 11/15/10 | 1,622,000 | 1,577,830 | |||||||
4.60%, 01/17/11 | 590,000 | 573,579 | |||||||
5.60%, 06/01/11 | 2,065,000 | 2,069,838 | |||||||
6.63%, 03/15/12 | 643,000 | 668,544 | |||||||
5.25%, 01/30/13 | 147,000 | 143,940 | |||||||
4.75%, 03/01/15 | 254,000 | 237,179 | |||||||
5.15%, 10/01/15 | 501,000 | 476,398 | |||||||
5.88%, 06/13/16 | 442,000 | 442,741 | |||||||
5.50%, 02/15/19 (a) (b) | 14,375,000 | 14,375,855 | |||||||
8.00%, 04/29/27 | 290,000 | 346,432 | |||||||
6.45%, 03/15/33 | 3,746,000 | 3,844,921 | |||||||
6.47%, 11/15/35 | 3,256,000 | 3,352,312 | |||||||
5.00%, 10/15/42 (a) | 2,224,000 | 2,101,166 | |||||||
5.88%, 04/15/45 (a) | 3,339,000 | 3,359,196 | |||||||
5.44%, 06/12/47 | 3,539,000 | 3,419,909 | |||||||
JP Morgan Commercial Mortgage Securities Corp., 6.84%, 11/15/35 (a) (b) | 1,858,000 | 1,949,349 | |||||||
Key Bank NA | |||||||||
5.70%, 08/15/12 | 265,000 | 265,688 | |||||||
5.80%, 07/01/14 | 147,000 | 146,172 | |||||||
6.95%, 02/01/28 | 225,000 | 238,447 | |||||||
Marshall & Ilsley Bank, 5.25%, 09/04/12 | 162,000 | 159,833 | |||||||
MBNA America Bank Corp. | |||||||||
4.63%, 08/03/09 | 1,256,000 | 1,237,165 | |||||||
5.00%, 05/04/10 | 324,000 | 319,928 | |||||||
National City Bank, 4.25%, 01/29/10 | 150,000 | 145,907 | |||||||
National City Corp. | |||||||||
6.20%, 12/15/11 | 300,000 | 306,774 | |||||||
4.90%, 01/15/15 | 354,000 | 333,764 | |||||||
Nationsbank Corp., 6.60%, 05/15/10 | 118,000 | 121,524 | |||||||
PNC Funding Corp., 5.25%, 11/15/15 | 354,000 | 340,085 | |||||||
Popular North America, Inc., 4.70%, 06/30/09 | 324,000 | 319,121 | |||||||
Regions Financial Corp., 6.38%, 05/15/12 | 88,000 | 90,548 | |||||||
Sanwa Bank Ltd., 7.40%, 06/15/11 | 354,000 | 377,424 | |||||||
SunTrust Banks, Inc. | |||||||||
5.20%, 01/17/17 | 177,000 | 167,567 | |||||||
5.45%, 12/01/17 | 183,000 | 176,088 | |||||||
Synovus Financial Corp., 4.88%, 02/15/13 | 88,000 | 84,545 | |||||||
U.S. Bancorp, 4.50%, 07/29/10 | 295,000 | 287,335 | |||||||
U.S. Bank NA | |||||||||
4.95%, 10/30/14 | 265,000 | 253,061 | |||||||
4.80%, 04/15/15 | 133,000 | 124,507 | |||||||
U.S. Bank NA Minnesota, 6.38%, 08/01/11 | 501,000 | 516,106 | |||||||
Union Planters Corp., 4.38%, 12/01/10 | 88,000 | 85,269 | |||||||
Unionbancal Corp., 5.25%, 12/16/13 | 206,000 | 200,365 | |||||||
Wachovia Bank Commercial Mortgage Trust, Series 06-C29, | |||||||||
Class A4, 5.31%, 11/15/48 | 2,950,000 | 2,825,125 | |||||||
Wachovia Corp. | |||||||||
3.63%, 02/17/09 | 1,755,000 | 1,708,893 | |||||||
5.30%, 10/15/11 | 2,065,000 | 2,043,621 | |||||||
4.88%, 02/15/14 | 183,000 | 174,594 | |||||||
5.60%, 03/15/16 | 708,000 | 695,058 | |||||||
7.12%, 04/15/34 | 1,711,000 | 1,771,777 | |||||||
5.50%, 08/01/35 | 487,000 | 436,560 | |||||||
Washington Mutual Bank, 5.13%, 01/15/15 | 1,032,000 | 972,977 | |||||||
Washington Mutual, Inc. | |||||||||
4.00%, 01/15/09 | 295,000 | 288,608 | |||||||
5.50%, 01/15/13 | 263,000 | 257,017 | |||||||
Wells Fargo & Co. | |||||||||
3.13%, 04/01/09 | 1,268,000 | 1,222,095 | |||||||
4.20%, 01/15/10 | 472,000 | 460,047 | |||||||
4.63%, 08/09/10 | 370,000 | 361,811 | |||||||
6.45%, 02/01/11 | 849,000 | 875,399 | |||||||
5.13%, 09/15/16 | 206,000 | 196,249 | |||||||
5.38%, 02/07/35 | 457,000 | 415,140 | |||||||
94,292,234 | |||||||||
Corporate Bonds (continued) | |||||||||
Principal | |||||||||
Amount | Value | ||||||||
Building Products (0.1%) | |||||||||
CRH America, Inc., 6.00%, 09/30/16 | $ | 885,000 | $ | 875,038 | |||||
Masco Corp., 6.13%, 10/03/16 | 585,000 | 575,432 | |||||||
1,450,470 | |||||||||
Computers & Peripherals (0.0%) | |||||||||
Cisco Systems, Inc., 5.25%, 02/22/11 | 295,000 | 293,231 | |||||||
Consumer Goods (0.8%) | |||||||||
Altria Group, Inc., 7.00%, 11/04/13 | 590,000 | 625,782 | |||||||
Anheuser-Busch Co., Inc. | |||||||||
4.38%, 01/15/13 | 29,000 | 27,122 | |||||||
5.00%, 03/01/19 | 236,000 | 216,396 | |||||||
5.75%, 04/01/36 | 324,000 | 297,630 | |||||||
6.00%, 11/01/41 | 147,000 | 134,504 | |||||||
Archer-Daniels-Midland | |||||||||
5.94%, 10/01/32 | 345,000 | 329,988 | |||||||
5.38%, 09/15/35 | 147,000 | 129,157 | |||||||
Bottling Group LLC, 4.63%, 11/15/12 | 413,000 | 395,239 | |||||||
Cadbury Schweppes PLC, 5.13%, 10/01/13 (b) | 177,000 | 170,039 | |||||||
Campbell Soup Co., 4.88%, 10/01/13 | 236,000 | 226,169 | |||||||
Coca-Cola Bottling Co., 5.00%, 11/15/12 | 88,000 | 84,545 | |||||||
Coca-Cola Enterprises, Inc. | |||||||||
8.50%, 02/01/12 | 354,000 | 395,640 | |||||||
6.95%, 11/15/26 | 147,000 | 158,793 | |||||||
6.75%, 09/15/28 | 351,000 | 370,991 | |||||||
Conagra Foods, Inc., 6.75%, 09/15/11 | 88,000 | 91,395 | |||||||
Fortune Brands, Inc. | |||||||||
5.13%, 01/15/11 | 413,000 | 403,010 | |||||||
5.38%, 01/15/16 | 265,000 | 246,038 | |||||||
General Mills, Inc., 6.00%, 02/15/12 | 267,000 | 269,866 | |||||||
Hershey Co., 5.45%, 09/01/16 | 383,000 | 373,814 | |||||||
JC Penney Corp, Inc., 5.75%, 02/15/18 | 900,000 | 868,852 | |||||||
Kellogg Co. | |||||||||
2.88%, 06/01/08 | 605,000 | 590,407 | |||||||
7.45%, 04/01/31 | 147,000 | 166,670 | |||||||
Kraft Foods, Inc. | |||||||||
4.13%, 11/12/09 | 590,000 | 571,564 | |||||||
5.63%, 11/01/11 | 468,000 | 464,337 | |||||||
6.50%, 11/01/31 | 189,000 | 182,713 | |||||||
Miller Brewing Co., 5.50%, 08/15/13 (b) | 147,000 | 144,542 | |||||||
Pepsi Bottling Group, Inc., 7.00%, 03/01/29 | 206,000 | 226,255 | |||||||
PepsiAmericas, Inc., 4.88%, 01/15/15 | 442,000 | 415,864 | |||||||
Procter & Gamble Co. | |||||||||
6.88%, 09/15/09 | 189,000 | 195,076 | |||||||
4.95%, 08/15/14 | 295,000 | 284,222 | |||||||
4.85%, 12/15/15 | 177,000 | 168,220 | |||||||
5.80%, 08/15/34 | 295,000 | 287,125 | |||||||
Sara Lee Corp., 6.25%, 09/15/11 | 251,000 | 255,379 | |||||||
Sysco Corp., 5.38%, 09/21/35 | 106,000 | 94,921 | |||||||
Unilever Capital Corp. | |||||||||
7.13%, 11/01/10 | 324,000 | 339,624 | |||||||
5.90%, 11/15/32 | 206,000 | 194,794 | |||||||
Wal-Mart Stores, Inc., 5.00%, 04/05/12 | 1,800,000 | 1,762,389 | |||||||
WM Wrigley Jr Co., 4.65%, 07/15/15 | 215,000 | 199,566 | |||||||
12,358,638 | |||||||||
Diversified Financial Services (3.9%) | |||||||||
AXA Financial, Inc., 7.75%, 08/01/10 | 265,000 | 282,110 | |||||||
Bear Stearns Co., Inc. | |||||||||
4.55%, 06/23/10 | 3,657,000 | 3,556,487 | |||||||
4.66%, 06/11/41 | 1,991,000 | 1,848,722 | |||||||
Credit Suisse First Boston Mortgage Corp. | |||||||||
5.72%, 11/15/19 (a) (b) | 14,343,097 | 14,340,646 | |||||||
6.73%, 12/18/35 | 2,988,000 | 3,090,987 | |||||||
5.18%, 11/15/36 | 2,950,000 | 2,885,412 | |||||||
CW Capital Cobalt, 5.22%, 08/15/48 | 3,539,000 | 3,367,287 | |||||||
Financing Corp., 9.80%, 11/30/17 | 18,000 | 24,099 | |||||||
Goldman Sachs Mortgage Securities Corp., 5.28%, 08/10/38 (a) | 3,067,000 | 3,000,019 | |||||||
Household Finance Corp., 5.88%, 02/01/09 | 956,000 | 962,519 |
NVIT Bond Index (Continued)
Corporate Bonds (continued) | |||||||||
Principal | |||||||||
Amount | Value | ||||||||
Diversified Financial Services (continued) | |||||||||
Lehman Brothers Holdings, Inc. | |||||||||
3.50%, 08/07/08 | $ | 708,000 | $ | 693,247 | |||||
5.50%, 04/04/16 | 1,475,000 | 1,432,080 | |||||||
Lehman Brothers-UBS Commercial Mortgage Trust, 5.12%, 11/15/32 | 3,109,000 | 3,012,135 | |||||||
Lincoln National Corp., 6.15%, 04/07/36 | 590,000 | 578,242 | |||||||
Morgan Stanley | |||||||||
6.20%, 11/15/31 | 6,488,000 | 6,540,296 | |||||||
6.71%, 12/15/31 | 2,102,354 | 2,125,177 | |||||||
4.73%, 06/12/47 | 3,097,000 | 3,032,639 | |||||||
Residential Capital Corp. | |||||||||
6.38%, 06/30/10 | 295,000 | 291,192 | |||||||
5.65%, 08/25/35 (a) | 5,552,018 | 5,547,636 | |||||||
SLM Corp., 5.13%, 08/27/12 | 1,475,000 | 1,305,669 | |||||||
57,916,601 | |||||||||
Electric Power (1.4%) | |||||||||
Alabama Power Co., 5.70%, 02/15/33 | 324,000 | 305,970 | |||||||
Amerenenergy Generating Co., 7.95%, 06/01/32 | 105,000 | 119,624 | |||||||
American Electric Power Co., 5.25%, 06/01/15 | 192,000 | 184,135 | |||||||
Appalachian Power Co., 5.80%, 10/01/35 | 206,000 | 189,849 | |||||||
Arizona Public Service Co., 5.50%, 09/01/35 | 215,000 | 186,301 | |||||||
Baltimore Gas & Electric, 5.90%, 10/01/16 (b) | 885,000 | 873,461 | |||||||
Centerpoint Energy Resources, 7.88%, 04/01/13 | 354,000 | 386,403 | |||||||
Cincinnati Gas & Electric Co., 5.40%, 06/15/33 | 74,000 | 64,918 | |||||||
Cincinnati Gas & Electric Corp., 5.70%, 09/15/12 | 41,000 | 40,978 | |||||||
Commonwealth Edison Corp., 6.15%, 03/15/12 | 118,000 | 118,559 | |||||||
Consolidated Edison, Inc. | |||||||||
4.70%, 06/15/09 | 147,000 | 145,147 | |||||||
7.15%, 12/01/09 | 35,000 | 36,370 | |||||||
4.88%, 02/01/13 | 124,000 | 119,570 | |||||||
5.38%, 12/15/15 | 177,000 | 171,625 | |||||||
5.88%, 04/01/33 | 118,000 | 112,897 | |||||||
Consolidated Natural Gas, Inc., 5.00%, 12/01/14 | 569,000 | 537,458 | |||||||
Constellation Energy Group, Inc., 6.13%, 09/01/09 | 313,000 | 316,328 | |||||||
Consumers Energy - ITC, 4.00%, 05/15/10 | 238,000 | 228,272 | |||||||
Dominion Resources, Inc. | |||||||||
5.70%, 09/17/12 | 162,000 | 162,129 | |||||||
6.30%, 03/15/33 | 442,000 | 437,344 | |||||||
5.95%, 06/15/35 | 251,000 | 235,355 | |||||||
DTE Energy Co., 6.35%, 06/01/16 | 413,000 | 416,739 | |||||||
Entergy Gulf States, Inc., 5.25%, 08/01/15 | 177,000 | 164,860 | |||||||
Entergy Mississippi, Inc., 5.15%, 02/01/13 | 289,000 | 277,126 | |||||||
FirstEnergy Corp., 7.38%, 11/15/31 | 413,000 | 447,093 | |||||||
Florida Power & Light Co. | |||||||||
4.85%, 02/01/13 | 147,000 | 141,201 | |||||||
5.85%, 02/01/33 | 100,000 | 96,866 | |||||||
5.90%, 03/01/33 | 68,000 | 65,365 | |||||||
5.95%, 10/01/33 | 77,000 | 75,558 | |||||||
5.40%, 09/01/35 | 130,000 | 117,770 | |||||||
General Electric Capital Corp., 4.35%, 06/10/48 | 3,539,000 | 3,445,981 | |||||||
Georgia Power Corp., 5.13%, 11/15/12 | 106,000 | 103,736 | |||||||
Metropolitan Edison, 4.88%, 04/01/14 | 236,000 | 220,879 | |||||||
MidAmerican Energy Holdings Co. | |||||||||
5.88%, 10/01/12 | 634,000 | 639,470 | |||||||
6.13%, 04/01/36 | 845,000 | 816,357 | |||||||
New York State Electric & Gas Corp., 5.75%, 05/01/23 | 59,000 | 54,754 | |||||||
Ohio Power Co. | |||||||||
6.00%, 06/01/16 | 501,000 | 501,479 | |||||||
6.60%, 02/15/33 | 236,000 | 244,218 | |||||||
Oncor Electric Deliver | |||||||||
6.38%, 05/01/12 | 552,000 | 563,271 | |||||||
6.38%, 01/15/15 | 442,000 | 448,308 | |||||||
Pacific Gas & Electric Co. | |||||||||
3.60%, 03/01/09 | 649,000 | 629,805 | |||||||
4.20%, 03/01/11 | 708,000 | 676,497 | |||||||
4.80%, 03/01/14 | 472,000 | 446,084 | |||||||
5.80%, 03/01/37 | 600,000 | 559,662 | |||||||
Pacificorp, 5.25%, 06/15/35 | 177,000 | 155,580 |
Corporate Bonds (continued) | |||||||||
Principal | |||||||||
Amount | Value | ||||||||
Electric Power (continued) | |||||||||
Pepco Holdings, Inc. | |||||||||
6.45%, 08/15/12 | $ | 106,000 | $ | 108,766 | |||||
7.45%, 08/15/32 | 118,000 | 129,237 | |||||||
Progress Energy, Inc. | |||||||||
7.10%, 03/01/11 | 122,000 | 127,839 | |||||||
7.75%, 03/01/31 | 236,000 | 272,844 | |||||||
PSEG Power Corp. | |||||||||
6.95%, 06/01/12 | 74,000 | 77,455 | |||||||
5.50%, 12/01/15 | 413,000 | 397,259 | |||||||
Public Service Co. of Colorado, 5.50%, 04/01/14 | 251,000 | 247,030 | |||||||
Public Service Electric & Gas, 5.13%, 09/01/12 | 195,000 | 190,631 | |||||||
Public Service New Mexico Corp., 4.40%, 09/15/08 | 103,000 | 101,386 | |||||||
Puget Energy, Inc., 5.48%, 06/01/35 | 147,000 | 129,853 | |||||||
Scana Corp. | |||||||||
6.88%, 05/15/11 | 516,000 | 537,062 | |||||||
6.25%, 02/01/12 | 147,000 | 150,206 | |||||||
South Carolina Electric & Gas Co., 4.80%, 10/01/12 | 383,000 | 369,558 | |||||||
Southern California Edison Co. | |||||||||
6.00%, 01/15/34 | 177,000 | 174,386 | |||||||
5.55%, 01/15/36 | 236,000 | 218,160 | |||||||
Southern Power Co., 6.25%, 07/15/12 | 251,000 | 256,626 | |||||||
Virginia Electric Power, 5.40%, 01/15/16 | 147,000 | 141,793 | |||||||
Westar Energy, Inc., 6.00%, 07/01/14 | 265,000 | 266,121 | |||||||
Wisconsin Electric Power, 5.63%, 05/15/33 | 59,000 | 55,133 | |||||||
Wisconsin Energy Corp., 5.50%, 12/01/08 | 177,000 | 177,037 | |||||||
Xcel Energy, Inc. | |||||||||
5.61%, 04/01/17 | 248,000 | 240,174 | |||||||
6.50%, 07/01/36 | 177,000 | 179,014 | |||||||
20,828,922 | |||||||||
Energy Companies (0.7%) | |||||||||
AGL Capital Corp., 4.45%, 04/15/13 | 177,000 | 163,769 | |||||||
Amerada Hess Corp., 7.30%, 08/15/31 | 354,000 | 379,636 | |||||||
Apache Corp. | |||||||||
6.25%, 04/15/12 | 230,000 | 235,780 | |||||||
7.63%, 07/01/19 | 59,000 | 65,404 | |||||||
Atmos Energy Corp. | |||||||||
4.00%, 10/15/09 | 413,000 | 399,108 | |||||||
5.13%, 01/15/13 | 133,000 | 127,410 | |||||||
4.95%, 10/15/14 | 265,000 | 246,762 | |||||||
BP Amoco PLC, 5.90%, 04/15/09 | 118,000 | 119,250 | |||||||
Colonial Pipeline, 7.63%, 04/15/32 | 215,000 | 257,260 | |||||||
Conoco Funding Co., 4.75%, 10/15/12 | 675,000 | 654,005 | |||||||
Conoco, Inc., 6.95%, 04/15/29 | 218,000 | 237,917 | |||||||
Conocophillips, 5.90%, 10/15/32 | 177,000 | 172,226 | |||||||
Duke Energy Corp., 6.25%, 01/15/12 | 1,400,000 | 1,437,045 | |||||||
Enterprise Products, 5.60%, 10/15/14 | 944,000 | 917,691 | |||||||
Halliburton Co., 5.50%, 10/15/10 | 472,000 | 471,542 | |||||||
Kinder Morgan Energy Partners LP | |||||||||
7.50%, 11/01/10 | 207,000 | 218,722 | |||||||
6.75%, 03/15/11 | 91,000 | 94,173 | |||||||
5.80%, 03/15/35 | 206,000 | 183,001 | |||||||
Marathon Oil Corp., 6.80%, 03/15/32 | 118,000 | 126,098 | |||||||
Motiva Enterprises Corp., 5.20%, 09/15/12 (b) | 74,000 | 72,408 | |||||||
Murphy Oil Corp., 6.38%, 05/01/12 | 59,000 | 59,785 | |||||||
Nabors, Inc., 5.38%, 08/15/12 | 41,000 | 39,906 | |||||||
Occidental Petroleum, 6.75%, 01/15/12 | 265,000 | 278,782 | |||||||
Ocean Energy, Inc., 7.25%, 10/01/11 | 578,000 | 608,361 | |||||||
Phillips Petroleum Co. | |||||||||
8.75%, 05/25/10 | 354,000 | 385,381 | |||||||
6.65%, 07/15/18 | 118,000 | 125,491 | |||||||
Plains All American Pipeline, 5.63%, 12/15/13 | 330,000 | 323,662 | |||||||
Texas Gas Transmission Corp., 4.60%, 06/01/15 | 177,000 | 161,828 | |||||||
TGT Pipelines LLC, 5.20%, 06/01/18 | 88,000 | 80,247 | |||||||
Valero Energy Corp. | |||||||||
6.88%, 04/15/12 | 590,000 | 617,866 | |||||||
7.50%, 04/15/32 | 118,000 | 128,864 |
NVIT Bond Index (Continued)
Corporate Bonds (continued) | |||||||||
Principal | |||||||||
Amount | Value | ||||||||
Energy Companies (continued) | |||||||||
Weatherford International, Inc., 5.50%, 02/15/16 | $ | 74,000 | $ | 70,721 | |||||
XTO Energy, Inc. | |||||||||
4.90%, 02/01/14 | 147,000 | 139,113 | |||||||
5.30%, 06/30/15 | 280,000 | 267,192 | |||||||
5.65%, 04/01/16 | 118,000 | 114,587 | |||||||
9,980,993 | |||||||||
Food Products (0.0%) | |||||||||
Conagra Foods, Inc., 7.00%, 10/01/28 | 221,000 | 230,215 | |||||||
Hotels, Restaurants & Leisure (0.7%) (a) (b) | |||||||||
TW Hotel Funding, 5.57%, 01/15/21 | 9,567,310 | 9,578,751 | |||||||
Independent Finance (0.1%) | |||||||||
Credit Suisse First Boston USA, Inc. | |||||||||
4.13%, 01/15/10 | 398,000 | 386,144 | |||||||
6.13%, 11/15/11 | 265,000 | 270,785 | |||||||
6.50%, 01/15/12 | 354,000 | 366,665 | |||||||
5.13%, 01/15/14 | 171,000 | 165,830 | |||||||
7.13%, 07/15/32 | 855,000 | 970,253 | |||||||
2,159,677 | |||||||||
Insurance (0.3%) | |||||||||
Aetna, Inc., 6.00%, 06/15/16 | 1,100,000 | 1,102,406 | |||||||
American International Group, 5.60%, 10/18/16 | 585,000 | 576,424 | |||||||
Chubb Corp., 6.00%, 05/11/37 | 750,000 | 714,023 | |||||||
Farmers Insurance Exchange, 8.63%, 05/01/24 (b) | 400,000 | 462,171 | |||||||
North Front Pass, 5.81%, 12/15/24 (b) | 295,000 | 285,059 | |||||||
Prudential Financial, Inc., 5.10%, 12/14/11 | 740,000 | 725,668 | |||||||
Travelers Cos., Inc., 5.75%, 12/15/17 | 585,000 | 571,257 | |||||||
4,437,008 | |||||||||
Machinery (0.0%) | |||||||||
Deere & Co., 8.10%, 05/15/30 | 500,000 | 618,066 | |||||||
Manufacturing (1.6%) | |||||||||
Albemarle Corp., 5.10%, 02/01/15 | 118,000 | 110,612 | |||||||
Barrick Gold Finance, Inc., 4.88%, 11/15/14 | 230,000 | 216,026 | |||||||
Black & Decker Corp., 4.75%, 11/01/14 | 230,000 | 210,328 | |||||||
Boeing Co., 6.13%, 02/15/33 | 295,000 | 303,690 | |||||||
Caterpillar, Inc., 7.30%, 05/01/31 | 100,000 | 113,179 | |||||||
Caterpillar Financial Services Corp., 6.05%, 08/15/36 | 177,000 | 174,130 | |||||||
Centex Corp. | |||||||||
7.88%, 02/01/11 | 147,000 | 154,257 | |||||||
7.50%, 01/15/12 | 59,000 | 61,094 | |||||||
6.50%, 05/01/16 | 354,000 | 340,428 | |||||||
Cisco Systems, Inc., 5.50%, 02/22/16 | 767,000 | 748,445 | |||||||
Clorox Co., 4.20%, 01/15/10 | 313,000 | 303,269 | |||||||
Cooper Industries, Inc., 5.50%, 11/01/09 | 103,000 | 103,065 | |||||||
Cytec Industries, Inc., 6.00%, 10/01/15 | 162,000 | 158,083 | |||||||
D.R. Horton, Inc., 6.00%, 04/15/11 | 649,000 | 632,640 | |||||||
Dell Computer Corp., 7.10%, 04/15/28 | 206,000 | 216,808 | |||||||
Dover, Corp., 4.88%, 10/15/15 | 224,000 | 210,231 | |||||||
Dow Chemical, 6.00%, 10/01/12 | 590,000 | 596,135 | |||||||
Du Pont, 5.25%, 12/15/16 | 885,000 | 840,082 | |||||||
Emerson Electric Co. | |||||||||
4.50%, 05/01/13 | 1,250,000 | 1,182,796 | |||||||
6.00%, 08/15/32 | 83,000 | 83,208 | |||||||
Exelon Corp. | |||||||||
4.90%, 06/15/15 | 413,000 | 380,067 | |||||||
5.63%, 06/15/35 | 236,000 | 210,841 | |||||||
General Electric Capital Corp., 5.00%, 02/01/13 | 929,000 | 900,701 | |||||||
Goodrich Corp. | |||||||||
6.29%, 07/01/16 | 354,000 | 361,542 | |||||||
6.80%, 07/01/36 | 185,000 | 191,460 | |||||||
Harris Corp., 6.35%, 02/01/28 | 147,000 | 147,407 |
Corporate Bonds (continued) | |||||||||
Principal | |||||||||
Amount | Value | ||||||||
Manufacturing (continued) | |||||||||
Hewlett Packard Co., 6.50%, 07/01/12 | $ | 292,000 | $ | 304,331 | |||||
Honeywell International, Inc. | |||||||||
6.13%, 11/01/11 | 147,000 | 150,421 | |||||||
5.40%, 03/15/16 | 705,000 | 685,890 | |||||||
IBM Corp. | |||||||||
5.50%, 01/15/09 | 118,000 | 118,475 | |||||||
4.75%, 11/29/12 | 516,000 | 498,767 | |||||||
5.88%, 11/29/32 | 983,000 | 972,067 | |||||||
International Paper Co. | |||||||||
4.00%, 04/01/10 | 501,000 | 480,881 | |||||||
5.93%, 10/30/12 | 43,000 | 42,893 | |||||||
5.30%, 04/01/15 | 206,000 | 194,532 | |||||||
John Deere Capital Corp., 6.95%, 04/25/14 | 159,000 | 170,440 | |||||||
Johnson Controls, Inc. | |||||||||
5.25%, 01/15/11 | 177,000 | 175,184 | |||||||
4.88%, 09/15/13 | 177,000 | 168,364 | |||||||
Jones Apparel Group Inc., 6.13%, 11/15/34 | 94,000 | 78,771 | |||||||
Kimberly-Clark Corp., 5.63%, 02/15/12 | 295,000 | 295,513 | |||||||
Lennar Corp. | |||||||||
5.95%, 03/01/13 | 53,000 | 51,670 | |||||||
5.50%, 09/01/14 | 295,000 | 276,939 | |||||||
Lockheed Martin Corp. | |||||||||
7.65%, 05/01/16 | 177,000 | 199,316 | |||||||
6.15%, 09/01/36 | 354,000 | 353,012 | |||||||
Lubrizol Corp. | |||||||||
5.50%, 10/01/14 | 354,000 | 339,178 | |||||||
6.50%, 10/01/34 | 147,000 | 141,897 | |||||||
Masco Corp. | |||||||||
5.88%, 07/15/12 | 212,000 | 210,263 | |||||||
4.80%, 06/15/15 | 354,000 | 319,360 | |||||||
MDC Holdings, Inc., 5.50%, 05/15/13 | 147,000 | 140,243 | |||||||
Motorola, Inc. | |||||||||
7.63%, 11/15/10 | 159,000 | 167,581 | |||||||
7.50%, 05/15/25 | 206,000 | 216,749 | |||||||
Newell Rubbermaid, Inc., 4.00%, 05/01/10 | 88,000 | 84,432 | |||||||
Newmont Mining Corp., 5.88%, 04/01/35 | 236,000 | 208,885 | |||||||
Norsk Hydro A.S.A., 6.80%, 01/15/28 | 650,000 | 701,809 | |||||||
Northrop Grumman Corp. | |||||||||
7.13%, 02/15/11 | 611,000 | 640,884 | |||||||
7.75%, 02/15/31 | 118,000 | 140,345 | |||||||
Pitney Bowes, Inc. | |||||||||
4.75%, 01/15/16 | 295,000 | 271,029 | |||||||
4.75%, 05/15/18 | 88,000 | 78,982 | |||||||
Praxair, Inc., 3.95%, 06/01/13 | 177,000 | 162,535 | |||||||
Procter & Gamble Co., 6.45%, 01/15/26 | 700,000 | 738,512 | |||||||
Pulte Homes, Inc. | |||||||||
4.88%, 07/15/09 | 339,000 | 333,541 | |||||||
7.88%, 08/01/11 | 24,000 | 24,906 | |||||||
6.25%, 02/15/13 | 62,000 | 59,991 | |||||||
6.00%, 02/15/35 | 147,000 | 125,261 | |||||||
Raytheon Co. | |||||||||
5.50%, 11/15/12 | 88,000 | 87,662 | |||||||
6.40%, 12/15/18 | 206,000 | 214,674 | |||||||
7.00%, 11/01/28 | 133,000 | 146,703 | |||||||
Rockwell Collins Corp., 4.75%, 12/01/13 | 295,000 | 278,825 | |||||||
Rohm & Haas Co., 7.85%, 07/15/29 | 118,000 | 134,848 | |||||||
Ryland Group, 5.38%, 01/15/15 | 236,000 | 214,040 | |||||||
Sealed Air Corp., 6.95%, 05/15/09 (b) | 152,000 | 155,653 | |||||||
Stanley Works, 4.90%, 11/01/12 | 133,000 | 128,027 | |||||||
Vale Overseas Ltd., 6.88%, 11/21/36 | 944,000 | 948,896 | |||||||
Westvaco Corp., 7.95%, 02/15/31 | 118,000 | 122,799 | |||||||
Weyerhaeuser Co. | |||||||||
5.95%, 11/01/08 | 182,000 | 183,336 | |||||||
6.75%, 03/15/12 | 782,000 | 809,101 | |||||||
7.38%, 03/15/32 | 221,000 | 224,193 | |||||||
22,923,130 | |||||||||
Media (0.0%) | |||||||||
Embarq Corp., 7.08%, 06/01/16 | 133,000 | 133,745 | |||||||
Viacom, Inc., 6.88%, 04/30/36 | 324,000 | 313,024 | |||||||
446,769 | |||||||||
Metals & Mining (0.0%) | |||||||||
Alcoa, Inc., 5.87%, 02/23/22 | 625,000 | 593,206 | |||||||
NVIT Bond Index (Continued)
Corporate Bonds (continued) | |||||||||
Principal | |||||||||
Amount | Value | ||||||||
Multiline Retail (0.1%) | |||||||||
Costco Wholesale Corp, 5.50%, 03/15/17 | $ | 850,000 | $ | 828,719 | |||||
Yum! Brands, Inc., 8.88%, 04/15/11 | 118,000 | 129,826 | |||||||
958,545 | |||||||||
Oil, Gas & Consumable Fuels (0.3%) | |||||||||
Anadarko Petroleum Corp., 6.45%, 09/15/36 | 531,000 | 510,730 | |||||||
Canadian Natural Resources, 6.25%, 03/15/38 | 590,000 | 558,248 | |||||||
Consolidated Natural Gas, 6.25%, 11/01/11 | 451,000 | 460,686 | |||||||
Texas East Transmission Corp., 7.30%, 12/01/10 | 2,275,000 | 2,393,059 | |||||||
3,922,723 | |||||||||
Other Financial (4.0%) | |||||||||
Ace Ina Holdings, 5.88%, 06/15/14 | 560,000 | 556,816 | |||||||
AIG, 6.90%, 03/15/32 (b) | 413,000 | 450,916 | |||||||
Allstate Corp. | |||||||||
6.13%, 02/15/12 | 254,000 | 260,515 | |||||||
5.00%, 08/15/14 | 295,000 | 282,115 | |||||||
6.13%, 12/15/32 | 118,000 | 115,482 | |||||||
5.55%, 05/09/35 | 88,000 | 79,529 | |||||||
5.95%, 04/01/36 | 118,000 | 112,606 | |||||||
American Express Centurion Bank, 4.38%, 07/30/09 | 400,000 | 393,260 | |||||||
American Express Co., 4.88%, 07/15/13 | 1,348,000 | 1,300,897 | |||||||
American General Corp., 7.50%, 07/15/25 | 147,000 | 167,732 | |||||||
American General Finance, 5.38%, 10/01/12 | 1,003,000 | 989,656 | |||||||
American International Group, Inc. | |||||||||
5.05%, 10/01/15 | 147,000 | 139,936 | |||||||
6.25%, 05/01/36 | 236,000 | 238,185 | |||||||
Ameritech Capital Funding, 6.45%, 01/15/18 | 88,000 | 89,091 | |||||||
Associates Corp. of North America, 6.95%, 11/01/18 | 339,000 | 367,474 | |||||||
Axa Financial, Inc., 7.00%, 04/01/28 | 133,000 | 143,716 | |||||||
Bae Systems Holdings, Inc., 4.75%, 08/15/10 (b) | 236,000 | 230,772 | |||||||
Bear Stearns Co., Inc. | |||||||||
5.70%, 11/15/14 | 369,000 | 361,846 | |||||||
5.30%, 10/30/15 | 177,000 | 167,739 | |||||||
4.65%, 07/02/18 | 354,000 | 311,733 | |||||||
Berkley Corp., 5.13%, 09/30/10 | 103,000 | 101,611 | |||||||
Berkshire Hathaway, Inc. | |||||||||
4.13%, 01/15/10 | 826,000 | 803,065 | |||||||
4.85%, 01/15/15 | 354,000 | 336,306 | |||||||
Boeing Capital Corp., 6.10%, 03/01/11 | 50,000 | 51,086 | |||||||
BP Capital Markets America, 4.20%, 06/15/18 | 147,000 | 127,713 | |||||||
Bunge International Ltd., 5.10%, 07/15/15 | 88,000 | 81,308 | |||||||
Caterpillar Financial Services Corp. | |||||||||
2.70%, 07/15/08 | 413,000 | 401,742 | |||||||
4.50%, 06/15/09 | 206,000 | 202,828 | |||||||
5.05%, 12/01/10 | 590,000 | 584,544 | |||||||
5.50%, 03/15/16 | 295,000 | 289,456 | |||||||
CIT Group, Inc. | |||||||||
3.88%, 11/03/08 | 460,000 | 450,422 | |||||||
4.75%, 12/15/10 | 201,000 | 194,944 | |||||||
5.13%, 09/30/14 | 251,000 | 237,137 | |||||||
5.40%, 01/30/16 | 177,000 | 166,926 | |||||||
5.85%, 09/15/16 | 1,150,000 | 1,108,332 | |||||||
6.00%, 04/01/36 | 206,000 | 191,201 | |||||||
CitiFinancial Credit Co., 10.00%, 05/15/09 | 59,000 | 63,748 | |||||||
Conocophillips, 5.50%, 04/15/13 | 324,000 | 323,589 | |||||||
Countrywide Financial Corp., 5.63%, 07/15/09 | 560,000 | 560,282 | |||||||
Countrywide Home Loan, 4.00%, 03/22/11 | 706,000 | 661,765 | |||||||
Devon Financing Corp., 6.88%, 09/30/11 | 643,000 | 671,250 | |||||||
Duke Capital LLC, 6.75%, 02/15/32 | 177,000 | 174,216 | |||||||
ERP Operating LP | |||||||||
5.25%, 09/15/14 | 472,000 | 454,735 | |||||||
5.38%, 08/01/16 | 295,000 | 282,894 | |||||||
First Data Corp. | |||||||||
3.38%, 08/01/08 | 354,000 | 349,702 | |||||||
4.95%, 06/15/15 | 147,000 | 141,594 | |||||||
General Electric Capital Corp. | |||||||||
4.63%, 09/15/09 | 634,000 | 625,161 | |||||||
3.75%, 12/15/09 | 826,000 | 795,835 |
Corporate Bonds (continued) | |||||||||
Principal | |||||||||
Amount | Value | ||||||||
Other Financial (continued) | |||||||||
5.50%, 04/28/11 | $ | 413,000 | $ | 412,911 | |||||
5.88%, 02/15/12 | 59,000 | 59,691 | |||||||
6.00%, 06/15/12 | 263,000 | 267,691 | |||||||
4.88%, 03/04/15 | 619,000 | 585,921 | |||||||
5.00%, 01/08/16 | 295,000 | 279,449 | |||||||
5.40%, 02/15/17 | 585,000 | 564,037 | |||||||
6.75%, 03/15/32 | 1,678,000 | 1,820,576 | |||||||
Genworth Financial, Inc. | |||||||||
5.75%, 06/15/14 | 88,000 | 87,616 | |||||||
6.50%, 06/15/34 | 206,000 | 211,320 | |||||||
GlaxoSmithKline PLC, 5.38%, 04/15/34 | 201,000 | 185,345 | |||||||
Goldman Sachs Group, Inc. | |||||||||
3.88%, 01/15/09 | 590,000 | 577,976 | |||||||
6.65%, 05/15/09 | 413,000 | 422,282 | |||||||
6.60%, 01/15/12 | 103,000 | 106,658 | |||||||
5.25%, 04/01/13 | 664,000 | 646,717 | |||||||
5.25%, 10/15/13 | 870,000 | 843,408 | |||||||
5.13%, 01/15/15 | 664,000 | 630,959 | |||||||
5.35%, 01/15/16 | 442,000 | 421,842 | |||||||
5.75%, 10/01/16 | 1,000,000 | 976,595 | |||||||
6.13%, 02/15/33 | 1,150,000 | 1,096,952 | |||||||
Harley Davidson Funding, 3.63%, 12/15/08 (b) | 354,000 | 345,105 | |||||||
Hartford Financial Services Group | |||||||||
4.75%, 03/01/14 | 118,000 | 111,557 | |||||||
6.10%, 10/01/41 | 59,000 | 57,183 | |||||||
Heinz (H.J.) Finance Co., 6.00%, 03/15/12 | 350,000 | 351,239 | |||||||
HJ Heinz Finance, 6.75%, 03/15/32 | 88,000 | 85,722 | |||||||
Household Finance Corp. | |||||||||
4.75%, 05/15/09 | 767,000 | 758,463 | |||||||
7.00%, 05/15/12 | 811,000 | 853,883 | |||||||
HSBC Finance Corp. | |||||||||
4.75%, 04/15/10 | 354,000 | 347,454 | |||||||
5.25%, 04/15/15 | 265,000 | 253,162 | |||||||
5.00%, 06/30/15 | 501,000 | 469,255 | |||||||
Infinity Property & Casualty, 5.50%, 02/18/14 | 118,000 | 112,893 | |||||||
ING Sec Life Institutional Fund, 4.25%, 01/15/10 (b) | 1,180,000 | 1,146,660 | |||||||
International Lease Finance Corp. | |||||||||
3.50%, 04/01/09 | 295,000 | 285,755 | |||||||
5.00%, 04/15/10 | 590,000 | 583,043 | |||||||
Istar Financial, Inc., 5.65%, 09/15/11 | 254,000 | 250,293 | |||||||
Jefferies Group, Inc., 6.25%, 01/15/36 | 177,000 | 165,857 | |||||||
John Deere Capital Corp. | |||||||||
4.88%, 03/16/09 | 354,000 | 350,949 | |||||||
4.40%, 07/15/09 | 383,000 | 375,554 | |||||||
John Hancock Financial Services, Inc., 5.63%, 12/01/08 | 59,000 | 59,187 | |||||||
Kern River Funding Corp., 4.89%, 04/30/18 | 81,000 | 77,412 | |||||||
Lehman Brothers Holdings, Inc. | |||||||||
4.25%, 01/27/10 | 457,000 | 445,518 | |||||||
7.88%, 08/15/10 | 57,000 | 60,780 | |||||||
6.63%, 01/18/12 | 525,000 | 544,555 | |||||||
4.80%, 03/13/14 | 737,000 | 695,553 | |||||||
Marsh & McLennan Cos., Inc. | |||||||||
6.25%, 03/15/12 | 103,000 | 103,694 | |||||||
5.75%, 09/15/15 | 543,000 | 513,100 | |||||||
Mellon Financial Corp. | |||||||||
6.40%, 05/14/11 | 265,000 | 272,821 | |||||||
5.00%, 12/01/14 | 265,000 | 254,628 | |||||||
MetLife, Inc. | |||||||||
6.13%, 12/01/11 | 640,000 | 653,583 | |||||||
5.50%, 06/15/14 | 265,000 | 260,271 | |||||||
5.70%, 06/15/35 | 324,000 | 299,424 | |||||||
Monumental Global Funding II, 4.38%, 07/30/09 (b) | 295,000 | 288,714 | |||||||
Morgan Stanley | |||||||||
5.05%, 01/21/11 | 1,030,000 | 1,008,706 | |||||||
6.60%, 04/01/12 | 501,000 | 519,570 | |||||||
5.30%, 03/01/13 | 664,000 | 650,835 | |||||||
4.75%, 04/01/14 | 590,000 | 550,965 | |||||||
5.45%, 01/09/17 | 2,655,000 | 2,513,863 | |||||||
7.25%, 04/01/32 | 324,000 | 359,450 | |||||||
National Rural Utilities | |||||||||
4.75%, 03/01/14 | 324,000 | 306,353 | |||||||
8.00%, 03/01/32 | 159,000 | 195,761 | |||||||
New York Life Insurance, 5.88%, 05/15/33 (b) | 200,000 | 192,906 | |||||||
Nisource Finance Corp., 5.25%, 09/15/17 | 260,000 | 240,231 | |||||||
Nissan Motor Acceptance, 4.63%, 03/08/10 (b) | 307,000 | 298,395 | |||||||
NLV Financial Corp., 7.50%, 08/15/33 (b) | 74,000 | 79,969 | |||||||
Pemex Project Funding Master | |||||||||
9.13%, 10/13/10 | 628,000 | 690,800 | |||||||
7.38%, 12/15/14 | 369,000 | 401,046 |
NVIT Bond Index (Continued)
Corporate Bonds (continued) | |||||||||
Principal | |||||||||
Amount | Value | ||||||||
Other Financial (continued) | |||||||||
5.75%, 12/15/15 | $ | 767,000 | $ | 752,427 | |||||
6.63%, 06/15/35 | 324,000 | 328,860 | |||||||
Progressive Corp., 6.25%, 12/01/32 | 162,000 | 163,018 | |||||||
Prudential Financial, Inc. | |||||||||
5.10%, 09/20/14 | 295,000 | 282,643 | |||||||
5.75%, 07/15/33 | 147,000 | 136,364 | |||||||
Residential Capital Corp. | |||||||||
6.13%, 11/21/08 | 590,000 | 584,615 | |||||||
6.88%, 06/30/15 | 531,000 | 515,025 | |||||||
RLI Corp., 5.95%, 01/15/14 | 118,000 | 114,960 | |||||||
SLM Corp., 5.38%, 05/15/14 | 1,091,000 | 934,912 | |||||||
Sprint Capital Corp. | |||||||||
6.13%, 11/15/08 | 501,000 | 503,838 | |||||||
6.38%, 05/01/09 | 221,000 | 223,715 | |||||||
8.38%, 03/15/12 | 1,215,000 | 1,323,613 | |||||||
Textron Financial Corp., 4.60%, 05/03/10 | 355,000 | 347,359 | |||||||
Toll Brothers, Inc., 6.88%, 11/15/12 | 88,000 | 89,694 | |||||||
Toyota Motor Credit Corp., 4.25%, 03/15/10 | 336,000 | 328,083 | |||||||
Travelers Property Casualty Corp., 6.38%, 03/15/33 | 192,000 | 190,488 | |||||||
UnitedHealth Group | |||||||||
5.38%, 03/15/16 | 295,000 | 284,168 | |||||||
5.80%, 03/15/36 | 708,000 | 651,568 | |||||||
Verizon Global Funding Corp. | |||||||||
7.25%, 12/01/10 | 537,000 | 566,075 | |||||||
6.88%, 06/15/12 | 295,000 | 310,647 | |||||||
7.38%, 09/01/12 | 522,000 | 562,216 | |||||||
4.38%, 06/01/13 | 369,000 | 343,615 | |||||||
4.90%, 09/15/15 | 590,000 | 552,249 | |||||||
7.75%, 12/01/30 | 1,190,000 | 1,332,994 | |||||||
5.85%, 09/15/35 | 118,000 | 108,230 | |||||||
WellPoint, Inc. | |||||||||
5.00%, 12/15/14 | 236,000 | 222,829 | |||||||
5.25%, 01/15/16 | 324,000 | 307,335 | |||||||
5.95%, 12/15/34 | 118,000 | 109,310 | |||||||
Western & Southern Finance, 5.75%, 07/15/33 (b) | 147,000 | 136,364 | |||||||
Willis Group North America, Inc., 5.63%, 07/15/15 | 177,000 | 164,809 | |||||||
59,305,494 | |||||||||
Pharmaceuticals (0.3%) | |||||||||
Bristol-Myers Squibb Co., 5.25%, 08/15/13 | 1,425,000 | 1,401,723 | |||||||
Eli Lilly & Co., 5.20%, 03/15/17 | 1,000,000 | 956,606 | |||||||
Schering-Plough Corp., 5.30%, 12/01/13 | 1,400,000 | 1,405,155 | |||||||
Teva Pharmaceutical Finance LLC, 6.15%, 02/01/36 | 142,000 | 132,738 | |||||||
3,896,222 | |||||||||
Real Estate Investment Trusts (REITs) (0.3%) | |||||||||
Avalonbay Communities, Inc., 6.63%, 09/15/11 | 88,000 | 91,355 | |||||||
Boston Properties, Inc., 5.00%, 06/01/15 | 590,000 | 558,201 | |||||||
Brandywine Operating Partners, 5.63%, 12/15/10 | 180,000 | 179,819 | |||||||
Camden Property Trust, 5.00%, 06/15/15 | 147,000 | 138,071 | |||||||
Developers Diversified Realty Corp., 5.38%, 10/15/12 | 295,000 | 289,082 | |||||||
Duke Realty Corp., 5.25%, 01/15/10 | 177,000 | 175,548 | |||||||
Health Care Property Investors, 6.00%, 01/30/17 | 472,000 | 462,121 | |||||||
Health Care Property Investors, Inc. | |||||||||
6.45%, 06/25/12 | 56,000 | 56,997 | |||||||
6.00%, 11/15/13 | 177,000 | 175,497 | |||||||
HRPT Properties Trust Corp., 5.75%, 02/15/14 | 177,000 | 174,140 | |||||||
Liberty Property LP, 7.25%, 03/15/11 | 38,000 | 39,865 | |||||||
Prologis, 5.25%, 11/15/10 | 472,000 | 466,884 | |||||||
Simon Property Group LP | |||||||||
4.60%, 06/15/10 | 236,000 | 229,797 | |||||||
5.10%, 06/15/15 | 531,000 | 504,742 | |||||||
6.10%, 05/01/16 | 413,000 | 418,010 | |||||||
Vordano Realty LP, 5.60%, 02/15/11 | 206,000 | 204,885 | |||||||
Washington Real Estate Investment Trust Corp., 5.25%, 01/15/14 | 118,000 | 114,245 | |||||||
Westfield Capital Corp., 5.13%, 11/15/14 (b) | 153,000 | 146,475 | |||||||
4,425,734 | |||||||||
Corporate Bonds (continued) | |||||||||
Principal | |||||||||
Amount | Value | ||||||||
Service Companies (2.0%) | |||||||||
Abbott Laboratories | |||||||||
5.40%, 09/15/08 | $ | 147,000 | $ | 146,920 | |||||
3.50%, 02/17/09 | 118,000 | 114,689 | |||||||
5.88%, 05/15/16 | 481,000 | 481,124 | |||||||
Amgen, Inc., 4.00%, 11/18/09 | 280,000 | 270,967 | |||||||
AOL Time Warner, Inc. | |||||||||
6.88%, 05/01/12 | 911,000 | 950,419 | |||||||
6.88%, 06/15/18 | 176,000 | 182,428 | |||||||
7.63%, 04/15/31 | 777,000 | 832,455 | |||||||
7.70%, 05/01/32 | 932,000 | 1,007,818 | |||||||
Baxter International, Inc., 4.63%, 03/15/15 | 77,000 | 71,250 | |||||||
Belo Corp., 8.00%, 11/01/08 | 86,000 | 88,310 | |||||||
Boston Scientific, 5.45%, 06/15/14 | 354,000 | 333,140 | |||||||
Comcast Corp. | |||||||||
6.20%, 11/15/08 | 280,000 | 282,221 | |||||||
6.88%, 06/15/09 | 472,000 | 483,269 | |||||||
5.85%, 01/15/10 | 864,000 | 869,754 | |||||||
8.38%, 03/15/13 | 236,000 | 263,449 | |||||||
5.90%, 03/15/16 | 413,000 | 405,675 | |||||||
6.50%, 01/15/17 | 413,000 | 421,655 | |||||||
9.46%, 11/15/22 | 118,000 | 149,760 | |||||||
7.05%, 03/15/33 | 295,000 | 304,479 | |||||||
5.65%, 06/15/35 | 236,000 | 205,321 | |||||||
6.50%, 11/15/35 | 100,000 | 96,935 | |||||||
6.45%, 03/15/37 | 342,000 | 329,594 | |||||||
Cox Communications, Inc. | |||||||||
7.75%, 11/01/10 | 145,000 | 154,205 | |||||||
7.13%, 10/01/12 | 295,000 | 311,660 | |||||||
5.45%, 12/15/14 | 354,000 | 342,478 | |||||||
5.50%, 10/01/15 | 383,000 | 368,011 | |||||||
CVS Corp., 4.00%, 09/15/09 | 118,000 | 114,205 | |||||||
Donnelley (R.R.) & Sons Co., 4.95%, 04/01/14 | 118,000 | 107,801 | |||||||
Donnelley (R.R.) & Sons Co., 6.13%, 01/15/17 | 700,000 | 681,551 | |||||||
Eli Lilly & Co. | |||||||||
6.00%, 03/15/12 | 295,000 | 303,122 | |||||||
7.13%, 06/01/25 | 118,000 | 130,889 | |||||||
Federated Department Stores | |||||||||
6.63%, 04/01/11 | 631,000 | 641,628 | |||||||
6.90%, 04/01/29 | 147,000 | 140,157 | |||||||
Gannett Co., 6.38%, 04/01/12 | 236,000 | 240,256 | |||||||
Genentech, Inc. | |||||||||
4.40%, 07/15/10 | 165,000 | 160,490 | |||||||
5.25%, 07/15/35 | 88,000 | 77,691 | |||||||
Home Depot, Inc. | |||||||||
5.25%, 12/16/13 | 1,180,000 | 1,138,214 | |||||||
5.40%, 03/01/16 | 590,000 | 553,061 | |||||||
J Paul Getty Trust Corp., 5.88%, 10/01/33 | 295,000 | 282,524 | |||||||
JC Penney Corp., Inc., 8.00%, 03/01/10 | 749,000 | 790,877 | |||||||
Johnson & Johnson, 4.95%, 05/15/33 | 413,000 | 369,794 | |||||||
Kohl’s Corp., 6.30%, 03/01/11 | 50,000 | 51,198 | |||||||
Kroger Co. | |||||||||
6.80%, 04/01/11 | 201,000 | 207,778 | |||||||
6.20%, 06/15/12 | 236,000 | 238,184 | |||||||
7.50%, 04/01/31 | 257,000 | 269,890 | |||||||
Limited Brands, Inc., 6.13%, 12/01/12 | 147,000 | 146,680 | |||||||
Lowe’s Cos., Inc., 6.50%, 03/15/29 | 236,000 | 236,596 | |||||||
May Department Stores Co., 5.75%, 07/15/14 | 442,000 | 423,699 | |||||||
Medtronic, Inc., 4.38%, 09/15/10 | 186,000 | 180,567 | |||||||
Merck & Co., Inc. | |||||||||
4.75%, 03/01/15 | 354,000 | 333,054 | |||||||
6.40%, 03/01/28 | 74,000 | 75,498 | |||||||
5.95%, 12/01/28 | 162,000 | 158,538 | |||||||
News America Holdings, Inc. | |||||||||
9.25%, 02/01/13 | 118,000 | 136,544 | |||||||
5.30%, 12/15/14 | 767,000 | 740,930 | |||||||
8.00%, 10/17/16 | 118,000 | 132,829 | |||||||
7.28%, 06/30/28 | 77,000 | 80,646 | |||||||
6.20%, 12/15/34 | 245,000 | 228,387 | |||||||
6.40%, 12/15/35 | 177,000 | 168,559 | |||||||
Omnicom Group, Inc., 5.90%, 04/15/16 | 177,000 | 174,838 | |||||||
Oracle Corp., 5.25%, 01/15/16 | 572,000 | 548,460 | |||||||
Pfizer, Inc., 4.65%, 03/01/18 | 265,000 | 242,193 | |||||||
Pharmacia Corp., 6.60%, 12/01/28 | 177,000 | 189,916 | |||||||
Quest Diagnostic, Inc., 5.45%, 11/01/15 | 324,000 | 305,142 |
NVIT Bond Index (Continued)
Corporate Bonds (continued) | |||||||||
Principal | |||||||||
Amount | Value | ||||||||
Service Companies (continued) | |||||||||
Safeway, Inc. | |||||||||
6.50%, 03/01/11 | $ | 236,000 | $ | 242,012 | |||||
5.80%, 08/15/12 | 206,000 | 206,044 | |||||||
5.63%, 08/15/14 | 177,000 | 172,500 | |||||||
Science Applications International, 5.50%, 07/01/33 | 177,000 | 151,977 | |||||||
Target Corp. | |||||||||
10.00%, 01/01/11 | 66,000 | 74,580 | |||||||
6.35%, 01/15/11 | 124,000 | 127,334 | |||||||
7.00%, 07/15/31 | 174,000 | 189,647 | |||||||
6.35%, 11/01/32 | 313,000 | 317,043 | |||||||
Tele-Communications, Inc., 9.80%, 02/01/12 | 307,000 | 354,356 | |||||||
Time Warner, Inc., 5.88%, 11/15/16 (b) | 700,000 | 680,821 | |||||||
Viacom, Inc. | |||||||||
5.63%, 08/15/12 | 590,000 | 580,076 | |||||||
6.25%, 04/30/16 | 649,000 | 639,229 | |||||||
7.88%, 07/30/30 | 80,000 | 82,725 | |||||||
5.50%, 05/15/33 | 118,000 | 97,577 | |||||||
Wal-Mart Stores, Inc. | |||||||||
6.88%, 08/10/09 | 820,000 | 845,639 | |||||||
4.13%, 07/01/10 | 413,000 | 399,729 | |||||||
4.13%, 02/15/11 | 383,000 | 367,744 | |||||||
7.55%, 02/15/30 | 118,000 | 137,094 | |||||||
5.25%, 09/01/35 | 708,000 | 618,897 | |||||||
Walt Disney Co. | |||||||||
6.38%, 03/01/12 | 139,000 | 143,981 | |||||||
6.20%, 06/20/14 | 413,000 | 427,140 | |||||||
Waste Management, Inc. | |||||||||
7.38%, 08/01/10 | 147,000 | 154,013 | |||||||
6.38%, 11/15/12 | 206,000 | 210,685 | |||||||
7.00%, 07/15/28 | 162,000 | 163,779 | |||||||
Wyeth | |||||||||
5.50%, 02/01/14 | 678,000 | 668,227 | |||||||
5.50%, 02/15/16 | 634,000 | 617,442 | |||||||
6.50%, 02/01/34 | 206,000 | 211,808 | |||||||
29,352,471 | |||||||||
Telephones (0.7%) | |||||||||
Alltel Corp., 7.00%, 07/01/12 | 731,000 | 691,953 | |||||||
AT&T Wireless Services, Inc. | |||||||||
8.13%, 05/01/12 | 44,000 | 48,380 | |||||||
8.75%, 03/01/31 | 321,000 | 400,165 | |||||||
BellSouth Corp. | |||||||||
4.20%, 09/15/09 | 354,000 | 344,776 | |||||||
6.00%, 10/15/11 | 838,000 | 848,605 | |||||||
5.20%, 09/15/14 | 501,000 | 480,777 | |||||||
6.55%, 06/15/34 | 177,000 | 176,702 | |||||||
6.00%, 11/15/34 | 501,000 | 468,928 | |||||||
Cingular Wireless LLC, 7.13%, 12/15/31 | 413,000 | 439,999 | |||||||
Embarq Corp., 6.74%, 06/01/13 | 767,000 | 781,632 | |||||||
France Telecom, 3,376.25%, 03/01/31 | 407,000 | 511,394 | |||||||
GTE Corp. | |||||||||
6.84%, 04/15/18 | 206,000 | 216,474 | |||||||
6.94%, 04/15/28 | 147,000 | 151,190 | |||||||
SBC Communications, Inc. | |||||||||
4.13%, 09/15/09 | 737,000 | 716,668 | |||||||
5.30%, 11/15/10 | 383,000 | 381,195 | |||||||
6.25%, 03/15/11 | 475,000 | 485,286 | |||||||
5.88%, 08/15/12 | 425,000 | 428,227 | |||||||
5.10%, 09/15/14 | 1,003,000 | 956,702 | |||||||
5.63%, 06/15/16 | 295,000 | 288,312 | |||||||
6.15%, 09/15/34 | 811,000 | 777,594 | |||||||
Vodafone Group PLC, 6.15%, 02/27/37 | 590,000 | 548,871 | |||||||
10,143,830 | |||||||||
Transportation (0.4%) | |||||||||
Burlington Northern Santa Fe Corp. | |||||||||
6.75%, 07/15/11 | 215,000 | 223,566 | |||||||
7.95%, 08/15/30 | 206,000 | 240,353 | |||||||
CSX Corp. | |||||||||
6.25%, 10/15/08 | 619,000 | 624,010 | |||||||
6.75%, 03/15/11 | 133,000 | 137,459 | |||||||
5.50%, 08/01/13 | 507,000 | 497,116 | |||||||
Norfolk Southern Corp. | |||||||||
6.75%, 02/15/11 | 964,000 | 999,315 | |||||||
5.59%, 05/17/25 | 84,000 | 76,395 | |||||||
7.25%, 02/15/31 | 270,000 | 291,628 | |||||||
Southwest Airlines Corp., 5.13%, 03/01/17 | 147,000 | 133,346 | |||||||
TTX Co., 4.90%, 03/01/15 (b) | 221,000 | 206,571 | |||||||
Union Pacific Corp. | |||||||||
3.63%, 06/01/10 | 242,000 | 229,690 | |||||||
5.38%, 06/01/33 | 62,000 | 54,057 | |||||||
6.25%, 05/01/34 | 236,000 | 229,837 | |||||||
United Parcel Service, Inc. | |||||||||
8.38%, 04/01/20 | 118,000 | 144,987 | |||||||
8.38%, 04/01/30 | 177,000 | 225,890 |
Corporate Bonds (continued) | |||||||||
Principal | |||||||||
Amount | Value | ||||||||
Transportation (continued) | |||||||||
United Technologies Corp. | |||||||||
6.35%, 03/01/11 | $ | 398,000 | $ | 409,548 | |||||
5.40%, 05/01/35 | 442,000 | 403,054 | |||||||
5,126,822 | |||||||||
Total Corporate Bonds (Cost $388,352,122) | 381,513,363 | ||||||||
Mortgage-Backed Obligations (0.8%) | |||||||||
Banks (0.8%) | |||||||||
First Union National Bank Commercial Mortgage Trust, 7.20%, 10/15/32 | 4,500,000 | 4,697,564 | |||||||
Wachovia Bank Commercial Mortgage Trust, 5.74%, 06/15/49 (a) | 7,500,000 | 7,418,700 | |||||||
Total Mortgage-Backed Obligations (Cost $12,120,833) | 12,116,264 | ||||||||
Municipal Bonds (0.1%) | |||||||||
Diversified Financial Services (0.1%) | |||||||||
City of Dallas, 5.25%, 02/15/24 | 708,000 | 700,899 | |||||||
Illinois State Taxable Pension, 5.10%, 06/01/33 | 1,005,000 | 910,701 | |||||||
Total Municipal Bonds (Cost $1,663,548) | 1,611,600 | ||||||||
Sovereign Bonds (3.1%) | |||||||||
Canada (0.7%) | |||||||||
Government of Canada, 5.25%, 11/05/08 | 962,000 | 964,013 | |||||||
Ontario Province | |||||||||
5.50%, 10/01/08 | 206,000 | 206,489 | |||||||
4.38%, 02/15/13 | 428,000 | 407,680 | |||||||
Providence of Manitoba, 7.50%, 02/22/10 | 295,000 | 311,084 | |||||||
Province of British Columbia, 4.30%, 05/30/13 | 159,000 | 150,908 | |||||||
Province of Manitoba, 5.00%, 02/15/12 | 1,475,000 | 1,459,394 | |||||||
Province of Nova Scotia, 5.13%, 01/26/17 | 885,000 | 862,795 | |||||||
Province of Ontario | |||||||||
4.50%, 02/03/15 | 667,000 | 632,629 | |||||||
4.75%, 01/19/16 | 295,000 | 281,916 | |||||||
Province of Quebec, 5.00%, 07/17/09 | 3,185,000 | 3,173,703 | |||||||
Quebec Province | |||||||||
4.60%, 05/26/15 | 354,000 | 333,913 | |||||||
7.50%, 09/15/29 | 578,000 | 699,467 | |||||||
9,483,991 | |||||||||
Chile (0.0%) | |||||||||
Republic of Chile, 5.50%, 01/15/13 | 177,000 | 175,248 | |||||||
China (0.0%) | |||||||||
People’s Republic of China, 4.75%, 10/29/13 | 295,000 | 285,136 | |||||||
Germany (0.2%) | |||||||||
KFW International Finance | |||||||||
3.25%, 03/30/09 | 531,000 | 513,738 | |||||||
4.13%, 10/15/14 | 708,000 | 661,764 | |||||||
4.38%, 07/21/15 | 1,445,000 | 1,355,187 | |||||||
Landwirtsch. Rentenbank, 4.88%, 02/14/11 | 885,000 | 873,658 | |||||||
3,404,347 | |||||||||
Iceland (0.0%) (b) | |||||||||
Kaupthing Bank, 7.13%, 05/19/16 | 354,000 | 373,952 | |||||||
Italy (0.3%) | |||||||||
Republic of Italy | |||||||||
4.00%, 06/16/08 | 826,000 | 816,134 | |||||||
3.25%, 05/15/09 | 1,003,000 | 969,891 | |||||||
4.38%, 06/15/13 | 560,000 | 530,990 | |||||||
4.50%, 01/21/15 | 938,000 | 885,394 | |||||||
4.75%, 01/25/16 | 413,000 | 393,563 |
NVIT Bond Index (Continued)
Sovereign Bonds (continued) | |||||||||
Principal | |||||||||
Amount | Value | ||||||||
Italy (continued) | |||||||||
6.88%, 09/27/23 | $ | 251,000 | $ | 279,574 | |||||
5.38%, 06/15/33 | 841,000 | 794,076 | |||||||
4,669,622 | |||||||||
Luxembourg (0.1%) | |||||||||
European Investment Bank | |||||||||
3.38%, 03/16/09 | 944,000 | 917,273 | |||||||
4.63%, 05/15/14 | 895,000 | 860,821 | |||||||
1,778,094 | |||||||||
Mexico (0.2%) | |||||||||
Banco Nacional de Comercio Exterior, 3.88%, 01/21/09 (b) | 59,000 | 56,935 | |||||||
United Mexican States | |||||||||
6.38%, 01/16/13 | 1,143,000 | 1,181,862 | |||||||
6.75%, 09/27/34 | 2,046,000 | 2,182,059 | |||||||
3,420,856 | |||||||||
Norway (0.1%) | |||||||||
Eksportsfinans | |||||||||
4.75%, 12/15/08 | 413,000 | 410,529 | |||||||
5.50%, 05/25/16 | 383,000 | 384,981 | |||||||
795,510 | |||||||||
Poland (0.0%) | |||||||||
Republic of Poland, 5.00%, 10/19/15 | 224,000 | 214,178 | |||||||
Republic of Korea (0.2%) | |||||||||
Bank of Korea Corp. | |||||||||
4.63%, 03/16/10 | 413,000 | 404,125 | |||||||
5.13%, 02/14/11 | 354,000 | 348,667 | |||||||
Korea Development Bank, 4.75%, 07/20/09 | 885,000 | 872,323 | |||||||
Korea Developmental Bank, 5.75%, 09/10/13 | 118,000 | 117,928 | |||||||
Republic of Korea, 4.25%, 06/01/13 | 708,000 | 660,466 | |||||||
2,403,509 | |||||||||
Senegal (0.1%) | |||||||||
Inter-American Development Bank, 6.80%, 10/15/25 | 413,000 | 469,217 | |||||||
South Africa (0.0%) | |||||||||
Republic of South Africa, 6.50%, 06/02/14 | 206,000 | 212,180 | |||||||
Spain (0.1%) | |||||||||
Telefonica Emisiones Sau, 6.42%, 06/20/16 | 1,770,000 | 1,794,695 | |||||||
Sweden (0.4%) | |||||||||
Swedish Export Credit Corp., 4.88%, 09/29/11 | 5,899,000 | 5,802,380 | |||||||
United States (0.7%) | |||||||||
European Investment Bank, 5.00%, 02/08/10 | 8,849,000 | 8,829,683 | |||||||
International Bank for Reconstruction & Development, 7.63%, 01/19/23 | 973,000 | 1,186,389 | |||||||
Province of British Columbia, 5.38%, 10/29/08 | 236,000 | 236,679 | |||||||
10,252,751 | |||||||||
Venezuela (0.0%) | |||||||||
Andina de Fomento Corp., 6.88%, 03/15/12 | 236,000 | 247,156 | |||||||
Total Sovereign Bonds (Cost $46,511,138) | 45,782,822 | ||||||||
U.S. Government Agency Long-Term Obligations (55.3%) | |||||||||
Federal Home Loan Bank, 5.25%, 06/05/17 | 10,000,000 | 9,833,730 | |||||||
Federal Home Loan Mortgage Corp. | |||||||||
4.88%, 02/17/09 - 11/15/13 | 12,205,000 | 11,932,104 | |||||||
5.75%, 03/15/09 | 14,886,000 | 15,010,507 | |||||||
5.25%, 05/21/09 | 16,933,000 | 16,946,225 | |||||||
4.25%, 07/15/09 | 1,363,000 | 1,338,496 | |||||||
6.63%, 09/15/09 | 634,000 | 652,588 | |||||||
5.13%, 07/15/12 | 6,091,000 | 6,056,574 | |||||||
5.00%, 07/15/14 - 12/14/18 | 7,019,000 | 6,742,937 | |||||||
4.38%, 07/17/15 | 7,214,000 | 6,731,268 | |||||||
4.75%, 11/17/15 | 9,002,000 | 8,596,550 | |||||||
4.00%, 03/01/20 - 04/01/20 | 92,004 | 85,481 | |||||||
4.50%, 08/01/20 | 2,456,618 | 2,337,742 | |||||||
6.75%, 09/15/29 | 557,000 | 638,372 | |||||||
6.25%, 07/15/32 | 1,245,000 | 1,349,683 | |||||||
6.00%, 12/01/36 - 04/01/37 | 9,317,179 | 9,232,869 | |||||||
5.73%, 05/01/37 | 11,021,099 | 11,000,060 | |||||||
Pool #1G2652, 5.74%, 04/01/37 (a) | 5,175,152 | 5,119,822 | |||||||
Pool #1J1593, 5.74%, 04/01/37 (a) | 10,843,183 | 10,857,557 |
U.S. Government Agency Long-Term Obligations (continued) | ||||||||
Principal | ||||||||
Amount | Value | |||||||
Pool #1J1594, 5.89%, 04/01/37 (a) | $ | 11,339,084 | $ | 11,330,832 | ||||
Pool #A10212, 6.50%, 06/01/33 | 39,556 | 40,226 | ||||||
Pool #A14012, 6.50%, 11/01/32 | 101,666 | 103,542 | �� | |||||
Pool #A16201, 7.00%, 08/01/29 | 27,573 | 28,507 | ||||||
Pool #A16419, 6.50%, 11/01/33 | 66,922 | 68,057 | ||||||
Pool #A16522, 6.50%, 12/01/33 | 421,075 | 428,212 | ||||||
Pool #A17177, 6.50%, 12/01/33 | 38,542 | 39,195 | ||||||
Pool #A17262, 6.50%, 12/01/33 | 174,523 | 177,481 | ||||||
Pool #A18212, 7.00%, 11/01/29 | 261,553 | 270,418 | ||||||
Pool #A21356, 6.50%, 04/01/34 | 272,626 | 276,800 | ||||||
Pool #A22067, 6.50%, 05/01/34 | 352,352 | 357,746 | ||||||
Pool #A24301, 6.50%, 05/01/34 | 241,688 | 245,388 | ||||||
Pool #A24988, 6.50%, 07/01/34 | 156,636 | 159,034 | ||||||
Pool #A31989, 6.50%, 04/01/35 | 94,381 | 95,486 | ||||||
Pool #A33015, 5.00%, 08/01/35 | 2,421,213 | 2,275,486 | ||||||
Pool #A33137, 6.50%, 01/01/35 | 98,857 | 100,370 | ||||||
Pool #A36407, 5.00%, 08/01/35 | 318,628 | 299,450 | ||||||
Pool #A36609, 5.00%, 08/01/35 | 5,818,892 | 5,468,668 | ||||||
Pool #A36646, 5.00%, 08/01/35 | 15,853,894 | 14,899,688 | ||||||
Pool #A36973, 5.00%, 08/01/35 | 420,713 | 395,391 | ||||||
Pool #A37135, 5.50%, 09/01/35 | 4,547,830 | 4,396,526 | ||||||
Pool #A37533, 4.50%, 09/01/35 | 304,728 | 277,339 | ||||||
Pool #A37534, 5.00%, 09/01/35 | 4,487,923 | 4,217,807 | ||||||
Pool #A37567, 5.00%, 09/01/35 | 355,884 | 334,465 | ||||||
Pool #A38074, 5.00%, 10/01/35 | 802,055 | 753,782 | ||||||
Pool #A38255, 5.50%, 10/01/35 | 3,879,917 | 3,750,835 | ||||||
Pool #A38531, 5.50%, 10/01/35 | 4,662,330 | 4,507,217 | ||||||
Pool #A38667, 5.50%, 10/01/35 | 3,469,388 | 3,353,964 | ||||||
Pool #A38817, 6.50%, 05/01/35 | 41,217 | 41,647 | ||||||
Pool #A39258, 5.00%, 11/01/35 | 211,606 | 198,870 | ||||||
Pool #A39490, 5.00%, 11/01/35 | 381,510 | 358,548 | ||||||
Pool #A39759, 5.50%, 11/01/35 | 260,088 | 251,435 | ||||||
Pool #A39892, 5.00%, 11/01/35 | 280,515 | 263,631 | ||||||
Pool #A40141, 6.50%, 11/01/35 | 187,903 | 190,102 | ||||||
Pool #A40182, 5.00%, 12/01/35 | 401,839 | 377,654 | ||||||
Pool #A40268, 5.00%, 12/01/35 | 316,719 | 297,656 | ||||||
Pool #A40376, 5.50%, 12/01/35 | 248,869 | 240,589 | ||||||
Pool #A41041, 5.00%, 12/01/35 | 683,477 | 642,340 | ||||||
Pool #A41326, 5.50%, 01/01/36 | 1,303,499 | 1,260,132 | ||||||
Pool #A41354, 5.50%, 01/01/36 | 8,554,528 | 8,269,924 | ||||||
Pool #A41548, 7.00%, 01/01/36 | 417,203 | 428,490 | ||||||
Pool #A41864, 5.00%, 01/01/36 | 326,165 | 306,534 | ||||||
Pool #A42298, 4.50%, 01/01/36 | 433,463 | 394,503 | ||||||
Pool #A42305, 5.50%, 01/01/36 | 2,030,277 | 1,959,155 | ||||||
Pool #A42332, 5.50%, 01/01/36 | 438,369 | 423,785 | ||||||
Pool #A43030, 6.00%, 02/01/36 | 1,096,200 | 1,086,892 | ||||||
Pool #A43452, 5.50%, 03/01/36 | 204,158 | 197,006 | ||||||
Pool #A43644, 6.50%, 03/01/36 | 183,538 | 185,512 |
NVIT Bond Index (Continued)
U.S. Government Agency Long-Term Obligations (continued) | ||||||||
Principal | ||||||||
Amount | Value | |||||||
Pool #A43672, 6.50%, 02/01/36 | $ | 116,995 | $ | 118,253 | ||||
Pool #A43757, 5.50%, 03/01/36 | 2,395,682 | 2,311,760 | ||||||
Pool #A43861, 5.50%, 03/01/36 | 5,398,654 | 5,209,536 | ||||||
Pool #A44534, 5.00%, 04/01/36 | 268,890 | 252,258 | ||||||
Pool #A44743, 5.00%, 04/01/36 | 225,478 | 211,907 | ||||||
Pool #A46279, 5.00%, 07/01/35 | 791,291 | 743,665 | ||||||
Pool #A46671, 5.00%, 08/01/35 | 272,804 | 256,385 | ||||||
Pool #A46718, 4.50%, 08/01/35 | 1,195,358 | 1,087,918 | ||||||
Pool #A46935, 6.50%, 09/01/35 | 174,613 | 176,657 | ||||||
Pool #A47036, 4.50%, 09/01/35 | 379,058 | 344,988 | ||||||
Pool #A47039, 5.00%, 09/01/35 | 3,886,283 | 3,652,378 | ||||||
Pool #A47055, 4.50%, 09/01/35 | 4,700,884 | 4,278,365 | ||||||
Pool #A47682, 6.50%, 11/01/35 | 951,552 | 962,686 | ||||||
Pool #A47750, 5.00%, 11/01/35 | 2,787,697 | 2,619,912 | ||||||
Pool #A47753, 5.00%, 11/01/35 | 3,403,799 | 3,198,933 | ||||||
Pool #A48303, 7.00%, 02/01/36 | 205,026 | 210,420 | ||||||
Pool #A48700, 4.50%, 05/01/36 | 174,412 | 158,616 | ||||||
Pool #A48735, 5.50%, 05/01/36 | 547,694 | 528,508 | ||||||
Pool #A48911, 5.50%, 05/01/36 | 777,331 | 750,101 | ||||||
Pool #A48976, 5.50%, 05/01/36 | 7,082,953 | 6,834,833 | ||||||
Pool #A49637, 5.00%, 06/01/36 | 1,071,209 | 1,004,951 | ||||||
Pool #A49653, 5.50%, 06/01/36 | 27,798,516 | 26,824,718 | ||||||
Pool #A49960, 7.00%, 06/01/36 | 62,863 | 64,517 | ||||||
Pool #A50139, 6.50%, 06/01/36 | 308,167 | 311,480 | ||||||
Pool #A50313, 5.50%, 07/01/36 | 679,273 | 655,478 | ||||||
Pool #A50714, 5.50%, 07/01/36 | 333,999 | 322,299 | ||||||
Pool #A50832, 5.50%, 07/01/36 | 978,591 | 944,311 | ||||||
Pool #A51069, 5.00%, 08/01/36 | 267,828 | 251,262 | ||||||
Pool #A51078, 5.50%, 08/01/36 | 350,807 | 338,518 | ||||||
Pool #A51250, 6.50%, 08/01/36 | 951,289 | 961,518 | ||||||
Pool #A51337, 6.50%, 08/01/36 | 301,583 | 304,826 | ||||||
Pool #A52253, 6.50%, 09/01/36 | 286,884 | 289,969 | ||||||
Pool #A52967, 6.00%, 10/01/36 | 3,415,765 | 3,386,760 | ||||||
Pool #A53039, 6.50%, 10/01/36 | 484,780 | 489,993 | ||||||
Pool #A53040, 5.50%, 10/01/36 | 1,262,115 | 1,217,902 | ||||||
Pool #A53219, 6.50%, 10/01/36 | 572,965 | 579,127 | ||||||
Pool #A53286, 5.50%, 10/01/36 | 1,637,893 | 1,580,517 | ||||||
Pool #A53603, 6.00%, 11/01/36 | 2,284,547 | 2,265,148 | ||||||
Pool #A53632, 6.00%, 10/01/36 | 31,143,499 | 30,879,045 | ||||||
Pool #A54580, 5.00%, 04/01/36 | 515,423 | 484,401 | ||||||
Pool #A55587, 5.50%, 12/01/36 | 457,690 | 441,657 | ||||||
Pool #A61025, 6.00%, 07/01/36 | 10,314,076 | 10,226,495 | ||||||
Pool #B10210, 5.50%, 10/01/18 | 448,057 | 441,273 | ||||||
Pool #B10650, 5.00%, 11/01/18 | 246,788 | 239,412 | ||||||
Pool #B10653, 5.50%, 11/01/18 | 338,545 | 334,573 | ||||||
Pool #B11186, 4.50%, 12/01/18 | 5,857,330 | 5,582,976 | ||||||
Pool #B11548, 5.50%, 12/01/18 | 120,116 | 118,297 | ||||||
Pool #B12214, 5.00%, 02/01/19 | 373,484 | 361,875 |
U.S. Government Agency Long-Term Obligations (continued) | ||||||||
Principal | ||||||||
Amount | Value | |||||||
Pool #B12737, 4.50%, 03/01/19 | $ | 516,770 | $ | 491,764 | ||||
Pool #B12908, 5.50%, 03/01/19 | 209,288 | 206,604 | ||||||
Pool #B13147, 5.00%, 01/01/19 | 635,627 | 616,631 | ||||||
Pool #B13430, 5.50%, 04/01/19 | 161,361 | 159,291 | ||||||
Pool #B13600, 5.50%, 04/01/19 | 118,370 | 116,852 | ||||||
Pool #B13671, 5.00%, 04/01/19 | 144,415 | 139,926 | ||||||
Pool #B14236, 5.00%, 05/01/19 | 441,139 | 427,427 | ||||||
Pool #B14288, 5.50%, 12/01/19 | 200,485 | 197,914 | ||||||
Pool #B14668, 5.00%, 01/01/20 | 634,641 | 613,804 | ||||||
Pool #B15013, 5.00%, 06/01/19 | 260,441 | 252,346 | ||||||
Pool #B15071, 6.00%, 06/01/17 | 349,041 | 350,999 | ||||||
Pool #B15172, 4.50%, 06/01/19 | 356,006 | 338,779 | ||||||
Pool #B15396, 5.50%, 06/01/19 | 173,769 | 171,540 | ||||||
Pool #B15503, 5.00%, 07/01/19 | 242,071 | 234,547 | ||||||
Pool #B15717, 5.00%, 07/01/19 | 367,296 | 355,879 | ||||||
Pool #B15759, 4.50%, 07/01/19 | 520,435 | 495,251 | ||||||
Pool #B15872, 5.00%, 07/01/19 | 163,844 | 158,751 | ||||||
Pool #B16087, 6.00%, 08/01/19 | 245,192 | 246,329 | ||||||
Pool #B16626, 5.00%, 09/01/19 | 1,058,463 | 1,025,563 | ||||||
Pool #B16648, 5.00%, 09/01/19 | 198,278 | 192,114 | ||||||
Pool #B16657, 5.00%, 09/01/19 | 242,832 | 235,284 | ||||||
Pool #B16826, 5.00%, 10/01/19 | 331,119 | 320,827 | ||||||
Pool #B16985, 5.00%, 10/01/19 | 146,528 | 141,974 | ||||||
Pool #B17371, 5.00%, 12/01/19 | 350,878 | 339,972 | ||||||
Pool #B17624, 5.00%, 01/01/20 | 449,579 | 435,605 | ||||||
Pool #B17982, 4.00%, 03/01/20 | 226,715 | 210,034 | ||||||
Pool #B18170, 5.00%, 04/01/20 | 214,029 | 207,002 | ||||||
Pool #B18276, 4.50%, 04/01/20 | 5,560,494 | 5,279,929 | ||||||
Pool #B18437, 5.50%, 05/01/20 | 170,293 | 167,714 | ||||||
Pool #B18939, 4.50%, 03/01/20 | 261,130 | 247,955 | ||||||
Pool #B19226, 4.00%, 04/01/20 | 66,362 | 61,479 | ||||||
Pool #B19414, 5.00%, 06/01/20 | 405,577 | 392,261 | ||||||
Pool #B19624, 4.50%, 07/01/20 | 250,530 | 237,889 | ||||||
Pool #B19642, 4.50%, 08/01/20 | 1,086,430 | 1,031,612 | ||||||
Pool #B19834, 4.50%, 08/01/20 | 382,054 | 362,777 | ||||||
Pool #C00351, 8.00%, 07/01/24 | 3,057 | 3,236 | ||||||
Pool #C00566, 7.50%, 12/01/27 | 12,472 | 13,051 | ||||||
Pool #C00676, 6.50%, 11/01/28 | 69,254 | 70,749 | ||||||
Pool #C00678, 7.00%, 11/01/28 | 16,936 | 17,508 | ||||||
Pool #C00836, 7.00%, 07/01/29 | 7,097 | 7,338 | ||||||
Pool #C00921, 7.50%, 02/01/30 | 9,059 | 9,457 | ||||||
Pool #C01051, 8.00%, 09/01/30 | 17,987 | 18,959 | ||||||
Pool #C01103, 7.50%, 12/01/30 | 7,849 | 8,112 | ||||||
Pool #C01106, 7.00%, 12/01/30 | 94,449 | 97,646 | ||||||
Pool #C01116, 7.50%, 01/01/31 | 7,526 | 7,856 | ||||||
Pool #C01172, 6.50%, 05/01/31 | 42,099 | 42,953 | ||||||
Pool #C01209, 8.00%, 06/01/31 | 4,477 | 4,719 | ||||||
Pool #C01220, 6.50%, 09/01/31 | 11,097 | 11,322 |
NVIT Bond Index (Continued)
U.S. Government Agency Long-Term Obligations (continued) | ||||||||
Principal | ||||||||
Amount | Value | |||||||
Pool #C01222, 7.00%, 09/01/31 | $ | 15,146 | $ | 15,634 | ||||
Pool #C01244, 6.50%, 10/01/31 | 63,722 | 65,014 | ||||||
Pool #C01271, 6.50%, 12/01/31 | 19,932 | 20,337 | ||||||
Pool #C01305, 7.50%, 12/01/31 | 8,959 | 9,345 | ||||||
Pool #C01310, 6.50%, 03/01/32 | 109,065 | 111,078 | ||||||
Pool #C01343, 6.50%, 04/01/32 | 96,004 | 97,776 | ||||||
Pool #C01345, 7.00%, 04/01/32 | 64,980 | 66,977 | ||||||
Pool #C01351, 6.50%, 05/01/32 | 62,273 | 63,422 | ||||||
Pool #C01364, 6.50%, 06/01/32 | 64,245 | 65,431 | ||||||
Pool #C01370, 8.00%, 04/01/32 | 13,954 | 14,715 | ||||||
Pool #C01381, 8.00%, 05/01/32 | 69,784 | 73,574 | ||||||
Pool #C01385, 6.50%, 08/01/32 | 90,281 | 91,948 | ||||||
Pool #C01396, 6.50%, 09/01/32 | 146,735 | 149,444 | ||||||
Pool #C01404, 6.50%, 10/01/32 | 355,657 | 362,222 | ||||||
Pool #C01806, 7.00%, 01/01/34 | 123,709 | 126,946 | ||||||
Pool #C01851, 6.50%, 04/01/34 | 271,763 | 275,923 | ||||||
Pool #C18271, 7.00%, 11/01/28 | 12,343 | 12,759 | ||||||
Pool #C30265, 6.50%, 08/01/29 | 13,755 | 14,052 | ||||||
Pool #C31282, 7.00%, 09/01/29 | 1,338 | 1,383 | ||||||
Pool #C31285, 7.00%, 09/01/29 | 16,480 | 17,038 | ||||||
Pool #C32914, 8.00%, 11/01/29 | 6,141 | 6,471 | ||||||
Pool #C36306, 7.00%, 02/01/30 | 7,494 | 7,748 | ||||||
Pool #C36429, 7.00%, 02/01/30 | 11,548 | 11,939 | ||||||
Pool #C37436, 8.00%, 01/01/30 | 9,967 | 10,502 | ||||||
Pool #C37703, 7.50%, 04/01/30 | 8,515 | 8,888 | ||||||
Pool #C41561, 8.00%, 08/01/30 | 4,569 | 4,816 | ||||||
Pool #C43550, 7.00%, 10/01/30 | 15,808 | 16,343 | ||||||
Pool #C43967, 8.00%, 10/01/30 | 52,980 | 55,842 | ||||||
Pool #C44017, 7.50%, 10/01/30 | 1,712 | 1,787 | ||||||
Pool #C44535, 7.50%, 11/01/30 | 8,770 | 9,154 | ||||||
Pool #C44957, 8.00%, 11/01/30 | 10,540 | 11,110 | ||||||
Pool #C44978, 7.00%, 11/01/30 | 2,272 | 2,349 | ||||||
Pool #C46932, 7.50%, 01/01/31 | 14,988 | 15,645 | ||||||
Pool #C47143, 8.00%, 01/01/31 | 50,997 | 53,752 | ||||||
Pool #C47287, 7.50%, 02/01/31 | 8,055 | 8,408 | ||||||
Pool #C48206, 7.50%, 03/01/31 | 16,281 | 16,995 | ||||||
Pool #C48851, 7.00%, 03/01/31 | 10,083 | 10,407 | ||||||
Pool #C52136, 7.00%, 05/01/31 | 21,605 | 22,300 | ||||||
Pool #C52685, 6.50%, 05/01/31 | 34,292 | 34,987 | ||||||
Pool #C53324, 7.00%, 06/01/31 | 18,609 | 19,208 | ||||||
Pool #C53589, 6.50%, 06/01/31 | 101,680 | 103,742 | ||||||
Pool #C54792, 7.00%, 07/01/31 | 84,767 | 87,493 | ||||||
Pool #C54897, 6.50%, 07/01/31 | 63,656 | 64,947 | ||||||
Pool #C55071, 7.50%, 07/01/31 | 897 | 935 | ||||||
Pool #C56769, 8.00%, 08/01/31 | 11,265 | 11,877 | ||||||
Pool #C58215, 6.50%, 09/01/31 | 3,164 | 3,228 | ||||||
Pool #C58362, 6.50%, 09/01/31 | 31,637 | 32,278 | ||||||
Pool #C58647, 7.00%, 10/01/31 | 3,470 | 3,581 |
U.S. Government Agency Long-Term Obligations (continued) | ||||||||
Principal | ||||||||
Amount | Value | |||||||
Pool #C58694, 7.00%, 10/01/31 | $ | 27,659 | $ | 28,548 | ||||
Pool #C58961, 6.50%, 10/01/31 | 545,905 | 556,977 | ||||||
Pool #C60012, 7.00%, 11/01/31 | 10,832 | 11,180 | ||||||
Pool #C60991, 6.50%, 11/01/31 | 12,660 | 12,917 | ||||||
Pool #C61105, 7.00%, 12/01/31 | 11,360 | 11,725 | ||||||
Pool #C61298, 8.00%, 11/01/31 | 16,823 | 17,737 | ||||||
Pool #C62218, 7.00%, 01/01/32 | 25,812 | 26,643 | ||||||
Pool #C63171, 7.00%, 01/01/32 | 40,633 | 41,940 | ||||||
Pool #C64121, 7.50%, 02/01/32 | 19,858 | 20,714 | ||||||
Pool #C64668, 6.50%, 03/01/32 | 22,278 | 22,689 | ||||||
Pool #C65466, 6.50%, 03/01/32 | 136,980 | 139,508 | ||||||
Pool #C65717, 7.50%, 04/01/32 | 11,386 | 11,855 | ||||||
Pool #C66088, 6.50%, 04/01/32 | 17,420 | 17,741 | ||||||
Pool #C66191, 6.50%, 04/01/32 | 34,864 | 35,507 | ||||||
Pool #C66192, 6.50%, 04/01/32 | 18,594 | 18,938 | ||||||
Pool #C66744, 7.00%, 04/01/32 | 6,026 | 6,212 | ||||||
Pool #C66758, 6.50%, 05/01/32 | 446,216 | 454,452 | ||||||
Pool #C66916, 7.00%, 05/01/32 | 38,295 | 39,472 | ||||||
Pool #C66919, 6.50%, 05/01/32 | 5,744 | 5,850 | ||||||
Pool #C67097, 6.50%, 05/01/32 | 11,007 | 11,210 | ||||||
Pool #C67235, 7.00%, 05/01/32 | 109,856 | 113,232 | ||||||
Pool #C67259, 7.00%, 05/01/32 | 4,319 | 4,451 | ||||||
Pool #C67313, 6.50%, 05/01/32 | 2,427 | 2,472 | ||||||
Pool #C67996, 6.50%, 06/01/32 | 14,215 | 14,478 | ||||||
Pool #C68290, 7.00%, 06/01/32 | 20,674 | 21,309 | ||||||
Pool #C68300, 7.00%, 06/01/32 | 86,871 | 89,541 | ||||||
Pool #C68307, 8.00%, 06/01/32 | 3,960 | 4,176 | ||||||
Pool #C68988, 7.50%, 07/01/32 | 4,740 | 4,935 | ||||||
Pool #C69908, 7.00%, 08/01/32 | 102,626 | 105,779 | ||||||
Pool #C69951, 6.50%, 08/01/32 | 38,480 | 39,190 | ||||||
Pool #C70211, 7.00%, 08/01/32 | 61,917 | 63,820 | ||||||
Pool #C71089, 7.50%, 09/01/32 | 23,793 | 24,773 | ||||||
Pool #C71403, 6.50%, 07/01/32 | 86,047 | 87,792 | ||||||
Pool #C72160, 7.50%, 10/01/32 | 12,143 | 12,643 | ||||||
Pool #C72361, 6.50%, 06/01/32 | 33,626 | 34,307 | ||||||
Pool #C72497, 6.50%, 06/01/32 | 21,770 | 22,212 | ||||||
Pool #C73984, 6.50%, 12/01/32 | 13,521 | 13,771 | ||||||
Pool #C74006, 6.50%, 08/01/32 | 16,235 | 16,534 | ||||||
Pool #C77531, 6.50%, 02/01/33 | 107,861 | 109,851 | ||||||
Pool #C90559, 7.00%, 05/01/22 | 120,806 | 124,992 | ||||||
Pool #D60780, 8.00%, 06/01/25 | 6,032 | 6,353 | ||||||
Pool #D64617, 8.00%, 10/01/25 | 39,778 | 42,072 | ||||||
Pool #D82854, 7.00%, 10/01/27 | 8,076 | 8,347 | ||||||
Pool #E00282, 6.50%, 03/01/09 | 43,397 | 44,185 | ||||||
Pool #E00394, 7.50%, 09/01/10 | 40,842 | 41,662 | ||||||
Pool #E00507, 7.50%, 09/01/12 | 3,685 | 3,790 | ||||||
Pool #E00677, 6.00%, 06/01/14 | 119,757 | 120,721 | ||||||
Pool #E00802, 7.50%, 02/01/15 | 57,494 | 59,520 |
NVIT Bond Index (Continued)
U.S. Government Agency Long-Term Obligations (continued) | ||||||||
Principal | ||||||||
Amount | Value | |||||||
Pool #E00938, 7.00%, 01/01/16 | $ | 25,247 | $ | 26,051 | ||||
Pool #E00975, 6.00%, 05/01/16 | 80,946 | 81,408 | ||||||
Pool #E00985, 6.00%, 06/01/16 | 45,074 | 45,331 | ||||||
Pool #E00987, 6.50%, 06/01/16 | 38,746 | 39,595 | ||||||
Pool #E00996, 6.50%, 07/01/16 | 4,872 | 4,979 | ||||||
Pool #E01083, 7.00%, 11/01/16 | 8,450 | 8,716 | ||||||
Pool #E01095, 6.00%, 01/01/17 | 17,815 | 17,915 | ||||||
Pool #E01127, 6.50%, 02/01/17 | 28,596 | 29,216 | ||||||
Pool #E01137, 6.00%, 03/01/17 | 27,039 | 27,190 | ||||||
Pool #E01138, 6.50%, 03/01/17 | 14,820 | 15,140 | ||||||
Pool #E01139, 6.00%, 04/01/17 | 120,665 | 121,341 | ||||||
Pool #E01140, 6.00%, 05/01/17 | 105,682 | 106,274 | ||||||
Pool #E01156, 6.50%, 05/01/17 | 40,793 | 41,664 | ||||||
Pool #E01157, 6.00%, 06/01/17 | 74,516 | 74,933 | ||||||
Pool #E01186, 5.50%, 08/01/17 | 236,338 | 233,657 | ||||||
Pool #E01205, 6.50%, 08/01/17 | 30,317 | 30,962 | ||||||
Pool #E01311, 5.50%, 02/01/18 | 2,443,411 | 2,415,346 | ||||||
Pool #E01344, 4.50%, 04/01/18 | 146,378 | 139,534 | ||||||
Pool #E01488, 5.00%, 10/01/18 | 157,327 | 152,619 | ||||||
Pool #E01538, 5.00%, 12/01/18 | 1,027,863 | 997,129 | ||||||
Pool #E01604, 5.50%, 03/01/19 | 181,212 | 178,468 | ||||||
Pool #E69050, 6.00%, 02/01/13 | 41,815 | 42,181 | ||||||
Pool #E72896, 7.00%, 10/01/13 | 21,131 | 21,758 | ||||||
Pool #E81394, 7.50%, 10/01/15 | 16,604 | 17,204 | ||||||
Pool #E81396, 7.00%, 10/01/15 | 1,724 | 1,779 | ||||||
Pool #E82132, 7.00%, 01/01/16 | 4,802 | 4,956 | ||||||
Pool #E82815, 6.00%, 03/01/16 | 20,556 | 20,673 | ||||||
Pool #E83046, 7.00%, 04/01/16 | 3,086 | 3,185 | ||||||
Pool #E83231, 6.00%, 04/01/16 | 5,926 | 5,959 | ||||||
Pool #E83233, 6.00%, 04/01/16 | 16,073 | 16,164 | ||||||
Pool #E83355, 6.00%, 05/01/16 | 22,134 | 22,258 | ||||||
Pool #E83636, 6.00%, 05/01/16 | 36,975 | 37,182 | ||||||
Pool #E83933, 6.50%, 05/01/16 | 1,297 | 1,325 | ||||||
Pool #E84097, 6.50%, 12/01/15 | 5,301 | 5,417 | ||||||
Pool #E84236, 6.50%, 06/01/16 | 9,917 | 10,131 | ||||||
Pool #E84912, 6.50%, 08/01/16 | 20,897 | 21,347 | ||||||
Pool #E85117, 6.50%, 08/01/16 | 14,103 | 14,407 | ||||||
Pool #E85387, 6.00%, 09/01/16 | 41,600 | 41,833 | ||||||
Pool #E85800, 6.50%, 10/01/16 | 8,696 | 8,883 | ||||||
Pool #E86183, 6.00%, 11/01/16 | 6,795 | 6,833 | ||||||
Pool #E86533, 6.00%, 12/01/16 | 13,594 | 13,670 | ||||||
Pool #E86746, 5.50%, 12/01/16 | 106,559 | 104,945 | ||||||
Pool #E86995, 6.50%, 01/01/17 | 37,630 | 38,441 | ||||||
Pool #E87291, 6.50%, 01/01/17 | 45,222 | 46,196 | ||||||
Pool #E87446, 6.50%, 01/01/17 | 9,977 | 10,183 | ||||||
Pool #E87584, 6.00%, 01/01/17 | 15,559 | 15,646 | ||||||
Pool #E88055, 6.50%, 02/01/17 | 73,809 | 75,333 | ||||||
Pool #E88076, 6.00%, 02/01/17 | 12,360 | 12,429 |
U.S. Government Agency Long-Term Obligations (continued) | ||||||||
Principal | ||||||||
Amount | Value | |||||||
Pool #E88106, 6.50%, 02/01/17 | $ | 49,749 | $ | 50,776 | ||||
Pool #E88134, 6.00%, 03/01/17 | 3,681 | 3,701 | ||||||
Pool #E88474, 6.00%, 03/01/17 | 26,344 | 26,490 | ||||||
Pool #E88729, 6.00%, 04/01/17 | 18,018 | 18,118 | ||||||
Pool #E88768, 6.00%, 03/01/17 | 68,013 | 68,394 | ||||||
Pool #E89149, 6.00%, 04/01/17 | 31,161 | 31,334 | ||||||
Pool #E89151, 6.00%, 04/01/17 | 26,612 | 26,760 | ||||||
Pool #E89203, 6.50%, 04/01/17 | 12,313 | 12,567 | ||||||
Pool #E89217, 6.00%, 04/01/17 | 17,037 | 17,131 | ||||||
Pool #E89222, 6.00%, 04/01/17 | 120,872 | 121,541 | ||||||
Pool #E89347, 6.00%, 04/01/17 | 6,153 | 6,187 | ||||||
Pool #E89496, 6.00%, 04/01/17 | 28,360 | 28,517 | ||||||
Pool #E89530, 6.00%, 05/01/17 | 71,721 | 72,118 | ||||||
Pool #E89746, 6.00%, 05/01/17 | 182,210 | 183,218 | ||||||
Pool #E89788, 6.00%, 05/01/17 | 16,731 | 16,824 | ||||||
Pool #E89909, 6.00%, 05/01/17 | 28,206 | 28,362 | ||||||
Pool #E89924, 6.50%, 05/01/17 | 79,977 | 81,628 | ||||||
Pool #E90194, 6.00%, 06/01/17 | 20,872 | 20,987 | ||||||
Pool #E90227, 6.00%, 06/01/17 | 16,736 | 16,829 | ||||||
Pool #E90313, 6.00%, 06/01/17 | 9,441 | 9,493 | ||||||
Pool #E90591, 5.50%, 07/01/17 | 103,945 | 102,750 | ||||||
Pool #E90594, 6.00%, 07/01/17 | 65,282 | 65,644 | ||||||
Pool #E90645, 6.00%, 07/01/17 | 120,102 | 120,767 | ||||||
Pool #E90667, 6.00%, 07/01/17 | 16,940 | 17,033 | ||||||
Pool #E93476, 5.00%, 01/01/18 | 197,831 | 191,904 | ||||||
Pool #E96459, 5.00%, 05/01/18 | 83,362 | 80,871 | ||||||
Pool #E97335, 5.00%, 07/01/18 | 1,591,855 | 1,544,282 | ||||||
Pool #E97366, 5.00%, 07/01/18 | 456,389 | 442,750 | ||||||
Pool #E97702, 5.00%, 07/01/18 | 605,751 | 587,648 | ||||||
Pool #E98207, 5.00%, 04/01/18 | 61,455 | 59,618 | ||||||
Pool #E98258, 5.00%, 07/01/18 | 276,334 | 268,075 | ||||||
Pool #E99426, 5.00%, 09/01/18 | 173,403 | 168,221 | ||||||
Pool #E99498, 5.00%, 09/01/18 | 180,562 | 175,166 | ||||||
Pool #E99579, 5.00%, 09/01/18 | 140,072 | 135,886 | ||||||
Pool #E99673, 5.00%, 10/01/18 | 80,768 | 78,354 | ||||||
Pool #E99675, 5.00%, 10/01/18 | 867,132 | 841,217 | ||||||
Pool #E99869, 5.00%, 06/01/18 | 102,552 | 99,479 | ||||||
Pool #G01108, 7.00%, 04/01/30 | 6,130 | 6,337 | ||||||
Pool #G01133, 6.50%, 07/01/30 | 47,820 | 48,852 | ||||||
Pool #G01217, 7.00%, 03/01/31 | 77,099 | 79,709 | ||||||
Pool #G01309, 7.00%, 08/01/31 | 20,694 | 21,360 | ||||||
Pool #G01311, 7.00%, 09/01/31 | 125,988 | 130,252 | ||||||
Pool #G01315, 7.00%, 09/01/31 | 4,865 | 5,030 | ||||||
Pool #G01355, 6.50%, 02/01/32 | 582,073 | 593,878 | ||||||
Pool #G01391, 7.00%, 04/01/32 | 202,769 | 209,632 | ||||||
Pool #G01433, 6.50%, 07/01/32 | 33,235 | 33,848 | ||||||
Pool #G01443, 6.50%, 08/01/32 | 226,590 | 230,772 | ||||||
Pool #G01444, 6.50%, 08/01/32 | 230,030 | 234,696 |
NVIT Bond Index (Continued)
U.S. Government Agency Long-Term Obligations (continued) | ||||||||
Principal | ||||||||
Amount | Value | |||||||
Pool #G01449, 7.00%, 07/01/32 | $ | 145,330 | $ | 150,249 | ||||
Pool #G01536, 7.00%, 03/01/33 | 101,739 | 104,402 | ||||||
Pool #G01741, 6.50%, 10/01/34 | 197,632 | 201,280 | ||||||
Pool #G01867, 5.00%, 08/01/35 | 6,148,491 | 5,778,429 | ||||||
Pool #G01890, 4.50%, 10/01/35 | 765,340 | 696,551 | ||||||
Pool #G01947, 7.00%, 05/01/35 | 171,590 | 176,863 | ||||||
Pool #G01959, 5.00%, 12/01/35 | 3,624,714 | 3,406,552 | ||||||
Pool #G02045, 4.50%, 10/01/35 | 275,164 | 250,432 | ||||||
Pool #G02186, 5.00%, 05/01/36 | 19,904,350 | 18,706,358 | ||||||
Pool #G02220, 4.50%, 01/01/36 | 232,562 | 211,659 | ||||||
Pool #G02267, 6.50%, 08/01/36 | 2,068,223 | 2,090,462 | ||||||
Pool #G02342, 5.00%, 10/01/36 | 1,574,139 | 1,476,772 | ||||||
Pool #G02375, 6.50%, 09/01/36 | 1,095,602 | 1,107,383 | ||||||
Pool #G08023, 6.50%, 11/01/34 | 310,053 | 314,799 | ||||||
Pool #G08064, 6.50%, 04/01/35 | 196,567 | 198,867 | ||||||
Pool #G08072, 5.00%, 08/01/35 | 4,430,600 | 4,163,934 | ||||||
Pool #G08073, 5.50%, 08/01/35 | 2,602,792 | 2,516,199 | ||||||
Pool #G08088, 6.50%, 10/01/35 | 1,037,515 | 1,049,656 | ||||||
Pool #G08095, 5.50%, 11/01/35 | 780,278 | 754,318 | ||||||
Pool #G08105, 5.50%, 01/01/36 | 9,485,457 | 9,169,882 | ||||||
Pool #G08109, 4.50%, 11/01/35 | 387,417 | 352,596 | ||||||
Pool #G08111, 5.50%, 02/01/36 | 6,953,829 | 6,710,232 | ||||||
Pool #G08116, 5.50%, 03/01/36 | 1,347,011 | 1,299,824 | ||||||
Pool #G08130, 6.50%, 05/01/36 | 346,480 | 350,205 | ||||||
Pool #G08134, 5.50%, 06/01/36 | 772,705 | 745,636 | ||||||
Pool #G08139, 5.50%, 07/01/36 | 1,580,690 | 1,525,317 | ||||||
Pool #G08141, 6.50%, 07/01/36 | 1,346,845 | 1,361,328 | ||||||
Pool #G08156, 6.00%, 10/01/36 | 5,209,697 | 5,165,459 | ||||||
Pool #G10399, 6.50%, 07/01/09 | 15,916 | 16,013 | ||||||
Pool #G10749, 6.00%, 10/01/12 | 86,588 | 87,478 | ||||||
Pool #G10940, 6.50%, 11/01/11 | 16,380 | 16,654 | ||||||
Pool #G11001, 6.50%, 03/01/15 | 44,069 | 45,074 | ||||||
Pool #G11003, 7.50%, 04/01/15 | 3,105 | 3,212 | ||||||
Pool #G11130, 6.00%, 12/01/11 | 154,037 | 155,269 | ||||||
Pool #G11164, 7.00%, 05/01/15 | 10,848 | 11,187 | ||||||
Pool #G11207, 7.00%, 11/01/16 | 25,057 | 25,864 | ||||||
Pool #G11295, 5.50%, 09/01/17 | 156,989 | 155,185 | ||||||
Pool #G11399, 5.50%, 04/01/18 | 231,199 | 228,604 | ||||||
Pool #G11409, 6.00%, 05/01/17 | 165,177 | 166,103 | ||||||
Pool #G11434, 6.50%, 01/01/18 | 46,849 | 47,858 | ||||||
Pool #G11458, 6.00%, 09/01/17 | 58,392 | 58,722 | ||||||
Pool #G11480, 5.00%, 11/01/18 | 820,836 | 796,305 | ||||||
Pool #G11531, 5.50%, 02/01/19 | 96,643 | 95,509 | ||||||
Pool #G11612, 6.00%, 04/01/14 | 96,681 | 97,322 | ||||||
Pool #G11742, 5.00%, 07/01/20 | 1,103,624 | 1,069,320 | ||||||
Pool #G11827, 4.50%, 11/01/20 | 2,792,213 | 2,651,326 | ||||||
Pool #G11880, 5.00%, 12/01/20 | 962,359 | 930,761 | ||||||
Pool #G11972, 6.00%, 04/01/16 | 350,830 | 352,832 |
U.S. Government Agency Long-Term Obligations (continued) | ||||||||
Principal | ||||||||
Amount | Value | |||||||
Pool #G11998, 4.50%, 04/01/21 | $ | 1,263,473 | $ | 1,199,722 | ||||
Pool #G12205, 4.50%, 06/01/21 | 476,905 | 452,842 | ||||||
Pool #G12245, 6.00%, 07/01/21 | 199,167 | 200,059 | ||||||
Pool #G12310, 5.50%, 08/01/21 | 157,633 | 155,295 | ||||||
Pool #G12348, 6.00%, 08/01/21 | 409,665 | 411,500 | ||||||
Pool #G12378, 4.50%, 09/01/21 | 275,043 | 261,165 | ||||||
Pool #G12412, 5.50%, 11/01/21 | 212,837 | 209,679 | ||||||
Pool #G18002, 5.00%, 07/01/19 | 185,730 | 179,957 | ||||||
Pool #G18005, 5.00%, 08/01/19 | 504,896 | 489,203 | ||||||
Pool #G18006, 5.50%, 08/01/19 | 169,823 | 167,645 | ||||||
Pool #G18007, 6.00%, 07/01/19 | 89,952 | 90,370 | ||||||
Pool #G18009, 5.00%, 09/01/19 | 889,689 | 862,035 | ||||||
Pool #G18022, 5.50%, 11/01/19 | 357,349 | 352,766 | ||||||
Pool #G18025, 4.50%, 12/01/19 | 921,299 | 876,717 | ||||||
Pool #G18050, 4.00%, 04/01/20 | 244,571 | 226,576 | ||||||
Pool #G18062, 6.00%, 06/01/20 | 173,674 | 174,389 | ||||||
Pool #G18072, 4.50%, 09/01/20 | 987,081 | 937,276 | ||||||
Pool #G18096, 5.50%, 01/01/21 | 152,122 | 149,819 | ||||||
Pool #G18116, 4.50%, 02/01/21 | 201,925 | 191,736 | ||||||
Pool #G18122, 5.00%, 06/01/21 | 273,172 | 264,045 | ||||||
Pool #G18123, 5.50%, 06/01/21 | 562,787 | 554,437 | ||||||
Pool #J00183, 4.50%, 10/01/20 | 297,562 | 282,548 | ||||||
Pool #J00219, 4.50%, 10/01/20 | 870,816 | 826,878 | ||||||
Pool #J00629, 4.50%, 12/01/20 | 276,187 | 262,252 | ||||||
Pool #J00637, 4.50%, 12/01/20 | 2,320,591 | 2,203,501 | ||||||
Pool #J00718, 5.00%, 12/01/20 | 1,631,270 | 1,577,710 | ||||||
Pool #J00854, 5.00%, 01/01/21 | 744,151 | 719,718 | ||||||
Pool #J00855, 5.50%, 01/01/21 | 352,135 | 347,100 | ||||||
Pool #J00871, 5.00%, 01/01/21 | 367,313 | 355,252 | ||||||
Pool #J00935, 5.00%, 12/01/20 | 137,921 | 133,392 | ||||||
Pool #J01006, 4.50%, 01/01/21 | 194,238 | 184,437 | ||||||
Pool #J01049, 5.00%, 01/01/21 | 3,704,755 | 3,583,115 | ||||||
Pool #J01189, 5.00%, 02/01/21 | 220,235 | 212,876 | ||||||
Pool #J01256, 5.00%, 03/01/21 | 195,468 | 188,937 | ||||||
Pool #J01279, 5.50%, 02/01/21 | 352,063 | 346,840 | ||||||
Pool #J01414, 5.00%, 03/01/21 | 149,337 | 144,347 | ||||||
Pool #J01570, 5.50%, 04/01/21 | 216,279 | 213,004 | ||||||
Pool #J01576, 5.00%, 04/01/21 | 986,336 | 953,380 | ||||||
Pool #J01633, 5.50%, 04/01/21 | 995,881 | 981,106 | ||||||
Pool #J01757, 5.00%, 05/01/21 | 355,202 | 343,334 | ||||||
Pool #J01771, 5.00%, 05/01/21 | 278,264 | 268,966 | ||||||
Pool #J01833, 5.00%, 05/01/21 | 160,480 | 155,118 | ||||||
Pool #J01879, 5.00%, 05/01/21 | 326,979 | 316,054 | ||||||
Pool #J01980, 6.00%, 06/01/21 | 428,077 | 429,994 | ||||||
Pool #J02235, 4.50%, 07/01/20 | 227,434 | 215,958 | ||||||
Pool #J02325, 5.50%, 07/01/20 | 496,133 | 489,038 | ||||||
Pool #J02428, 4.00%, 08/01/20 | 5,936,306 | 5,499,532 | ||||||
Pool #J02438, 4.50%, 08/01/20 | 208,153 | 197,651 |
NVIT Bond Index (Continued)
U.S. Government Agency Long-Term Obligations (continued) | |||||||||
Principal | |||||||||
Amount | Value | ||||||||
Pool #J02508, 4.50%, 09/01/20 | $ | 296,882 | $ | 281,902 | |||||
Pool #J02527, 4.50%, 09/01/20 | 1,125,219 | 1,068,444 | |||||||
Pool #J02551, 4.50%, 09/01/20 | 150,658 | 143,056 | |||||||
Pool #J02664, 4.50%, 10/01/20 | 200,314 | 190,207 | |||||||
Pool #J03028, 5.50%, 07/01/21 | 337,811 | 332,800 | |||||||
Pool #J03074, 5.00%, 07/01/21 | 265,150 | 256,291 | |||||||
Pool #J05831, 4.50%, 11/01/20 | 190,705 | 181,082 | |||||||
Pool #J05986, 5.00%, 02/01/21 | 169,148 | 163,594 | |||||||
Pool #J06015, 5.00%, 05/01/21 | 335,188 | 323,988 | |||||||
Pool #M80898, 4.50%, 02/01/11 | 478,225 | 465,280 | |||||||
Pool #M80904, 4.50%, 03/01/11 | 307,369 | 297,125 | |||||||
Pool #M80917, 4.50%, 05/01/11 | 73,051 | 71,074 | |||||||
Pool #M80926, 4.50%, 07/01/11 | 306,044 | 297,759 | |||||||
Pool #M80934, 4.50%, 08/01/11 | 371,958 | 359,562 | |||||||
Pool #M80981, 4.50%, 07/01/12 | 148,782 | 144,246 | |||||||
Pool #M81009, 4.50%, 02/01/13 | 163,712 | 158,256 | |||||||
Federal National Mortgage Association | |||||||||
2.50%, 06/15/08 | 9,934,000 | 9,678,825 | |||||||
4.50%, 10/15/08 | 239,000 | 236,822 | |||||||
4.88%, 04/15/09 | 14,231,000 | 14,149,940 | |||||||
5.38%, 08/15/09 - 11/15/11 | 14,703,000 | 14,762,087 | |||||||
6.63%, 09/15/09 | 18,104,000 | 18,636,927 | |||||||
5.13%, 04/15/11 | 4,796,000 | 4,778,605 | |||||||
4.38%, 03/15/13 - 10/15/15 | 11,736,000 | 11,179,512 | |||||||
4.63%, 10/15/14 | 1,779,000 | 1,697,863 | |||||||
5.00%, 04/15/15 - 06/01/36 | 70,031,183 | 65,847,766 | |||||||
5.50%, 07/01/20 - 06/01/37 | 32,770,901 | 31,944,911 | |||||||
6.00%, 04/01/36 - 06/01/37 | 10,155,361 | 10,049,539 | |||||||
6.50%, 08/01/36 - 06/01/37 | 12,844,261 | 12,967,527 | |||||||
Pool #255315, 4.00%, 07/01/19 | 247,353 | 229,527 | |||||||
Pool #256023, 6.00%, 12/01/35 | 7,797,120 | 7,713,628 | |||||||
Pool #560868, 7.50%, 02/01/31 | 6,206 | 6,477 | |||||||
Pool #607212, 7.50%, 10/01/31 | 114,813 | 119,832 | |||||||
Pool #607559, 6.50%, 11/01/31 | 5,088 | 5,187 | |||||||
Pool #607632, 6.50%, 11/01/31 | 1,384 | 1,411 | |||||||
Pool #656559, 6.50%, 02/01/33 | 322,312 | 328,021 | |||||||
Pool #661664, 7.50%, 09/01/32 | 111,917 | 116,592 | |||||||
Pool #694846, 6.50%, 04/01/33 | 46,450 | 46,891 | |||||||
Pool #709921, 5.00%, 06/01/18 | 89,265 | 86,597 | |||||||
Pool #735141, 5.50%, 01/01/35 | 10,100,038 | 9,741,386 | |||||||
Pool #750229, 6.50%, 10/01/33 | 357,427 | 360,819 | |||||||
Pool #788027, 6.50%, 09/01/34 | 221,208 | 224,408 | |||||||
Pool #804847, 4.50%, 01/01/35 | 358,531 | 326,619 | |||||||
Pool #811970, 4.50%, 02/01/20 | 112,970 | 107,200 | |||||||
Pool #888077, 5.00%, 08/01/36 | 3,038,780 | 2,847,306 | |||||||
Pool #894441, 5.85%, 08/01/36 (a) | 10,343,351 | 10,392,537 | |||||||
Pool #908698, 6.50%, 10/01/36 | 1,847,968 | 1,865,505 | |||||||
Federal National Mortgage Association TBA | |||||||||
5.00%, 06/12/37 - 07/17/37 | 11,000,000 | 10,541,081 | |||||||
5.50%, 07/15/37 | 4,000,000 | 3,857,500 | |||||||
6.00%, 07/15/37 | 4,000,000 | 3,956,248 | |||||||
Government National Mortgage Association | |||||||||
6.00%, 06/15/35 | 97,906 | 97,553 | |||||||
Pool #279461, 9.00%, 11/15/19 | 3,804 | 4,086 | |||||||
Pool #376510, 7.00%, 05/15/24 | 10,194 | 10,623 | |||||||
Pool #416538, 7.00%, 10/15/29 | 6,074 | 6,332 |
U.S. Government Agency Long-Term Obligations (continued) | ||||||||
Principal | ||||||||
Amount | Value | |||||||
Pool #434505, 7.50%, 08/15/29 | $ | 2,456 | $ | 2,573 | ||||
Pool #457801, 7.00%, 08/15/28 | 16,594 | 17,299 | ||||||
Pool #470643, 7.00%, 07/15/29 | 19,805 | 20,646 | ||||||
Pool #485879, 7.00%, 08/15/31 | 32,155 | 33,503 | ||||||
Pool #486019, 7.50%, 01/15/31 | 5,782 | 6,054 | ||||||
Pool #486921, 5.50%, 02/15/35 | 213,824 | 207,517 | ||||||
Pool #486936, 6.50%, 02/15/29 | 11,681 | 11,934 | ||||||
Pool #487053, 7.00%, 03/15/29 | 14,835 | 15,465 | ||||||
Pool #490258, 6.50%, 02/15/29 | 2,298 | 2,348 | ||||||
Pool #502969, 6.00%, 03/15/29 | 32,598 | 32,548 | ||||||
Pool #507396, 7.50%, 09/15/30 | 106,703 | 111,746 | ||||||
Pool #508473, 7.50%, 04/15/31 | 23,317 | 24,415 | ||||||
Pool #509099, 7.00%, 06/15/29 | 7,501 | 7,820 | ||||||
Pool #524269, 8.00%, 11/15/29 | 10,984 | 11,658 | ||||||
Pool #525561, 8.00%, 01/15/30 | 4,345 | 4,613 | ||||||
Pool #528589, 6.50%, 03/15/31 | 94,515 | 96,493 | ||||||
Pool #531352, 7.50%, 09/15/30 | 14,240 | 14,913 | ||||||
Pool #535388, 7.50%, 01/15/31 | 5,454 | 5,711 | ||||||
Pool #536334, 7.50%, 10/15/30 | 1,617 | 1,694 | ||||||
Pool #537406, 7.50%, 02/15/31 | 6,194 | 6,486 | ||||||
Pool #540659, 7.00%, 01/15/31 | 1,208 | 1,259 | ||||||
Pool #544470, 8.00%, 04/15/31 | 4,578 | 4,862 | ||||||
Pool #547948, 6.50%, 11/15/31 | 10,129 | 10,341 | ||||||
Pool #549742, 7.00%, 07/15/31 | 15,440 | 16,088 | ||||||
Pool #550991, 6.50%, 10/15/31 | 16,823 | 17,175 | ||||||
Pool #552474, 7.00%, 03/15/32 | 19,043 | 19,846 | ||||||
Pool #552616, 7.00%, 06/15/32 | 111,404 | 116,099 | ||||||
Pool #552903, 6.50%, 11/15/32 | 572,228 | 583,696 | ||||||
Pool #552952, 6.00%, 12/15/32 | 103,951 | 103,725 | ||||||
Pool #553144, 5.50%, 04/15/33 | 356,866 | 347,058 | ||||||
Pool #553320, 6.00%, 06/15/33 | 226,996 | 226,372 | ||||||
Pool #555125, 7.00%, 09/15/31 | 5,346 | 5,571 | ||||||
Pool #555171, 6.50%, 12/15/31 | 4,973 | 5,077 | ||||||
Pool #564799, 6.00%, 03/15/34 | 862,091 | 859,060 | ||||||
Pool #568715, 7.00%, 05/15/32 | 85,590 | 89,197 | ||||||
Pool #570022, 7.00%, 07/15/32 | 174,865 | 182,234 | ||||||
Pool #571267, 7.00%, 10/15/31 | 4,905 | 5,111 | ||||||
Pool #572554, 6.50%, 09/15/31 | 258,582 | 263,993 | ||||||
Pool #572733, 6.00%, 07/15/33 | 62,177 | 62,006 | ||||||
Pool #573916, 6.00%, 11/15/33 | 208,472 | 207,899 | ||||||
Pool #574837, 7.50%, 11/15/31 | 6,787 | 7,106 | ||||||
Pool #580972, 6.50%, 02/15/32 | 9,124 | 9,307 | ||||||
Pool #583645, 8.00%, 07/15/32 | 16,199 | 17,208 | ||||||
Pool #588192, 6.00%, 02/15/33 | 54,195 | 54,046 | ||||||
Pool #595077, 6.00%, 10/15/32 | 102,244 | 102,021 | ||||||
Pool #596657, 7.00%, 10/15/32 | 7,393 | 7,705 | ||||||
Pool #602102, 6.00%, 02/15/33 | 132,526 | 132,161 | ||||||
Pool #602461, 5.00%, 12/15/35 | 209,551 | 198,444 |
NVIT Bond Index (Continued)
U.S. Government Agency Long-Term Obligations (continued) | |||||||||
Principal | |||||||||
Amount | Value | ||||||||
Pool #603520, 6.00%, 03/15/33 | $ | 122,802 | $ | 122,464 | |||||
Pool #604243, 6.00%, 04/15/33 | 217,542 | 216,945 | |||||||
Pool #604788, 6.50%, 11/15/33 | 378,779 | 386,063 | |||||||
Pool #604875, 6.00%, 12/15/33 | 439,228 | 438,022 | |||||||
Pool #606308, 5.50%, 05/15/36 | 656,562 | 637,331 | |||||||
Pool #606314, 5.50%, 05/15/36 | 267,455 | 259,622 | |||||||
Pool #611526, 6.00%, 05/15/33 | 88,548 | 88,304 | |||||||
Pool #621856, 6.00%, 01/15/34 | 196,052 | 195,363 | |||||||
Pool #630038, 6.50%, 08/15/34 | 412,058 | 419,645 | |||||||
Pool #631924, 6.00%, 05/15/33 | 151,382 | 150,967 | |||||||
Pool #635306, 6.00%, 06/15/36 | 1,653,388 | 1,644,924 | |||||||
Pool #641734, 4.50%, 09/15/35 | 1,436,735 | 1,318,766 | |||||||
Pool #641779, 5.00%, 09/15/35 | 5,119,333 | 4,847,972 | |||||||
Pool #645035, 5.00%, 07/15/35 | 255,977 | 242,408 | |||||||
Pool #646799, 4.50%, 07/15/35 | 246,769 | 226,507 | |||||||
Pool #648439, 5.00%, 01/15/36 | 423,711 | 400,946 | |||||||
Pool #649454, 5.50%, 09/15/35 | 1,946,848 | 1,891,631 | |||||||
Pool #649510, 5.50%, 10/15/35 | 3,031,912 | 2,945,920 | |||||||
Pool #649513, 5.50%, 10/15/35 | 3,841,283 | 3,732,336 | |||||||
Pool #650712, 5.00%, 01/15/36 | 588,934 | 557,292 | |||||||
Pool #652207, 5.50%, 03/15/36 | 3,598,249 | 3,492,859 | |||||||
Pool #652539, 5.00%, 05/15/36 | 276,712 | 261,845 | |||||||
Pool #653598, 5.50%, 05/15/36 | 939,408 | 911,893 | |||||||
Pool #655457, 6.00%, 05/15/36 | 291,801 | 290,398 | |||||||
Pool #655519, 5.00%, 05/15/36 | 523,260 | 495,147 | |||||||
Pool #656666, 6.00%, 06/15/36 | 1,572,036 | 1,563,989 | |||||||
Pool #657912, 6.50%, 08/15/36 | 498,547 | 506,688 | |||||||
Pool #781014, 6.00%, 04/15/29 | 32,607 | 32,561 | |||||||
Pool #781124, 7.00%, 12/15/29 | 60,327 | 62,890 | |||||||
Pool #781287, 7.00%, 05/15/31 | 35,669 | 37,180 | |||||||
Pool #781319, 7.00%, 07/15/31 | 11,569 | 12,056 | |||||||
Pool #781328, 7.00%, 09/15/31 | 33,236 | 34,644 | |||||||
Pool #781380, 7.50%, 12/15/31 | 10,547 | 10,970 | |||||||
Pool #781401, 7.50%, 02/15/32 | 28,955 | 30,321 | |||||||
Pool #781429, 8.00%, 03/15/32 | 26,946 | 28,612 | |||||||
Pool #781431, 7.00%, 04/15/32 | 128,758 | 134,159 | |||||||
Pool #781478, 7.50%, 03/15/32 | 18,114 | 18,971 | |||||||
Pool #781481, 7.50%, 01/15/32 | 57,163 | 59,868 | |||||||
Pool #781688, 6.00%, 12/15/33 | 396,084 | 395,108 | |||||||
Pool #781690, 6.00%, 12/15/33 | 169,200 | 168,808 | |||||||
Pool #781699, 7.00%, 12/15/33 | 63,723 | 66,399 | |||||||
Pool #781804, 6.00%, 09/15/34 | 592,255 | 590,162 | |||||||
Pool #781847, 6.00%, 12/15/34 | 537,192 | 535,280 | |||||||
Pool #781902, 6.00%, 02/15/35 | 553,982 | 552,002 | |||||||
Pool #781905, 5.00%, 04/15/35 | 1,267,408 | 1,200,462 | |||||||
Pool #781916, 6.50%, 03/15/32 | 641,863 | 654,913 | |||||||
Tennessee Valley Authority, 6.25%, 12/15/17 | 50,000 | 53,009 | |||||||
U.S. Treasury Bonds | |||||||||
8.75%, 05/15/17 | 6,524,000 | 8,358,875 | |||||||
8.50%, 02/15/20 | 4,238,000 | 5,531,251 |
U.S. Government Agency Long-Term Obligations (continued) | |||||||||
Principal | |||||||||
Amount | Value | ||||||||
6.25%, 08/15/23 | $ | 28,926,000 | $ | 32,119,170 | |||||
6.88%, 08/15/25 | 4,713,000 | 5,614,729 | |||||||
5.38%, 02/15/31 | 6,607,000 | 6,784,563 | |||||||
Total U.S. Government Agency Long-Term Obligations (Cost $830,585,554) | 816,088,237 | ||||||||
U.S. Treasury Notes (15.6%) | |||||||||
U.S. Treasury Notes | |||||||||
3.13%, 10/15/08 | 782,000 | 764,222 | |||||||
4.88%, 10/31/08 - 08/15/16 | 39,124,000 | 38,949,464 | |||||||
4.75%, 02/15/10 - 02/15/37 | 79,265,000 | 78,680,256 | |||||||
4.50%, 09/30/11 - 02/15/36 | 56,847,000 | 55,067,504 | |||||||
4.63%, 02/29/12 - 02/15/17 | 22,662,000 | 22,233,561 | |||||||
4.00%, 11/15/12 - 02/15/15 | 10,646,000 | 9,983,362 | |||||||
4.13%, 05/15/15 | 9,348,000 | 8,809,761 | |||||||
6.38%, 08/15/27 | 14,592,000 | 16,680,480 | |||||||
Total U.S. Treasury Notes (Cost $232,561,643) | 231,168,610 | ||||||||
Yankee Dollars (2.2%) | |||||||||
Banks (0.5%) | |||||||||
BSCH Issuances Ltd. | |||||||||
7.63%, 11/03/09 | 2,714,000 | 2,844,454 | |||||||
7.63%, 09/14/10 | 59,000 | 62,782 | |||||||
HBOS PLC, 5.46%, 11/29/49 (b) | 354,000 | 342,788 | |||||||
HSBC Bank USA, 7.50%, 07/15/09 | 563,000 | 585,428 | |||||||
Landwirtsch Rentenbank, 5.25%, 07/15/11 | 350,000 | 350,245 | |||||||
National Bank of Australia, 8.60%, 05/19/10 | 177,000 | 191,899 | |||||||
Oesterreichische Kontrollbank AG, 4.88%, 02/16/16 | 350,000 | 337,105 | |||||||
Royal Bank of Scotland Group | |||||||||
5.00%, 11/12/13 | 236,000 | 228,949 | |||||||
5.05%, 01/08/15 | 316,000 | 303,363 | |||||||
4.70%, 07/03/18 | 472,000 | 428,758 | |||||||
St. George Bank Ltd., 5.30%, 10/15/15 (b) | 236,000 | 228,307 | |||||||
UBS AG Stamford CT, 5.88%, 07/15/16 | 1,121,000 | 1,135,533 | |||||||
Westpac Banking Corp., 4.63%, 06/01/18 | 147,000 | 132,514 | |||||||
7,172,125 | |||||||||
Consumer Goods (0.0%) | |||||||||
Diageo Capital PLC, 7.25%, 11/01/09 | 350,000 | 363,386 | |||||||
Electric Power (0.0%) | |||||||||
Hydro Quebec Corp. | |||||||||
8.40%, 01/15/22 | 220,000 | 278,575 | |||||||
8.88%, 03/01/26 | 156,000 | 211,691 | |||||||
Scottish Power, 5.81%, 03/15/25 | 118,000 | 113,907 | |||||||
604,173 | |||||||||
Energy Companies (0.2%) | |||||||||
Canadian Natural Resources, 4.90%, 12/01/14 | 280,000 | 262,023 | |||||||
EnCana Corp., 4.75%, 10/15/13 | 339,000 | 320,037 | |||||||
Nexen, Inc. | |||||||||
5.05%, 11/20/13 | 295,000 | 280,838 | |||||||
5.20%, 03/10/15 | 350,000 | 331,392 | |||||||
5.88%, 03/10/35 | 133,000 | 119,358 | |||||||
Norsk Hydro AS, 6.36%, 01/15/09 | 271,000 | 274,404 | |||||||
Petro-Canada, 5.95%, 05/15/35 | 271,000 | 249,526 | |||||||
Ptt Public Co. Ltd., 5.88%, 08/03/35 (b) | 177,000 | 159,379 | |||||||
Talisman Energy, Inc. | |||||||||
7.25%, 10/15/27 | 133,000 | 137,977 | |||||||
5.75%, 05/15/35 | 350,000 | 303,803 | |||||||
Transocean Sedco Forex, Inc., 7.50%, 04/15/31 | 177,000 | 195,729 | |||||||
2,634,466 | |||||||||
Manufacturing (0.2%) | |||||||||
Alcan, Inc. | |||||||||
6.45%, 03/15/11 | 44,000 | 44,953 | |||||||
4.50%, 05/15/13 | 372,000 | 346,266 | |||||||
5.00%, 06/01/15 | 295,000 | 274,423 | |||||||
5.75%, 06/01/35 | 206,000 | 182,598 | |||||||
AstraZeneca PLC, 5.40%, 06/01/14 | 295,000 | 289,742 | |||||||
Celulosa Arauco Constitucion SA, 5.13%, 07/09/13 | 177,000 | 169,021 |
NVIT Bond Index (Continued)
Yankee Dollars (continued) | |||||||||
Principal | |||||||||
Amount | Value | ||||||||
Manufacturing (continued) | |||||||||
Codelco, Inc., 6.38%, 11/30/12 | $ | 120,000 | $ | 124,276 | |||||
Inco Ltd., 7.75%, 05/15/12 | 177,000 | 190,800 | |||||||
Lafarge SA, 6.50%, 07/15/16 | 265,000 | 271,254 | |||||||
Noranda, Inc., 6.20%, 06/15/35 | 177,000 | 169,248 | |||||||
Placer Dome, Inc., 6.38%, 03/01/33 | 139,000 | 133,929 | |||||||
Potash Corp. of Saskatchewan, Inc. | |||||||||
7.75%, 05/31/11 | 41,000 | 43,960 | |||||||
4.88%, 03/01/13 | 165,000 | 156,460 | |||||||
Teck Cominco Ltd., 6.13%, 10/01/35 | 147,000 | 135,927 | |||||||
Yara International Asa, 5.25%, 12/15/14 (b) | 147,000 | 138,892 | |||||||
2,671,749 | |||||||||
Oil, Gas & Consumable Fuels (0.1%) | |||||||||
Conocophillips Canada Corp., 5.63%, 10/15/16 | 365,000 | 359,147 | |||||||
Enbridge, Inc., 5.60%, 04/01/17 | 1,000,000 | 961,810 | |||||||
1,320,957 | |||||||||
Other Financial (0.7%) | |||||||||
Anadarko Finance Co., 6.75%, 05/01/11 | 118,000 | 121,834 | |||||||
Anadarko Petroleum Corp., 7.50%, 05/01/31 | 298,000 | 320,184 | |||||||
Apache Finance Canada, 4.38%, 05/15/15 | 487,000 | 446,175 | |||||||
BHP Billiton Ltd., 4.80%, 04/15/13 | 236,000 | 225,295 | |||||||
BHP Finance Corp., 6.42%, 03/01/26 | 80,000 | 81,628 | |||||||
Brascan Corp., 5.75%, 03/01/10 | 180,000 | 180,893 | |||||||
Bskyb Finance UK Ltd., 5.63%, 10/15/15 (b) | 147,000 | 141,713 | |||||||
Burlington Resources Finance Co., 6.40%, 08/15/11 | 124,000 | 128,001 | |||||||
Burlington Resources, Inc., 6.50%, 12/01/11 | 206,000 | 213,705 | |||||||
CIT Group, Inc., 5.20%, 06/01/15 | 177,000 | 164,579 | |||||||
Conoco Funding Co., 6.35%, 10/15/11 | 767,000 | 790,882 | |||||||
Deutsche Bank Financial LLC., 5.38%, 03/02/15 | 177,000 | 172,639 | |||||||
Deutsche Telekom International Finance | |||||||||
3.88%, 07/22/08 | 413,000 | 406,128 | |||||||
5.25%, 07/22/13 | 737,000 | 712,724 | |||||||
5.75%, 03/23/16 | 1,177,000 | 1,148,179 | |||||||
8.25%, 06/15/30 | 369,000 | 442,270 | |||||||
Diageo Capital PLC, 5.30%, 10/28/15 | 649,000 | 622,685 | |||||||
Encana Holdings Finance Corp., 5.80%, 05/01/14 | 634,000 | 630,947 | |||||||
Hanson Australia Funding, 5.25%, 03/15/13 | 265,000 | 259,058 | |||||||
Inversiones CMPC SA, 4.88%, 06/18/13 (b) | 177,000 | 167,743 | |||||||
Montpelier RE Holdings, 6.13%, 08/15/13 | 74,000 | 71,831 | |||||||
Oester Kontroll Bank, 4.50%, 03/09/15 | 236,000 | 223,417 | |||||||
Telecom Italia Capital | |||||||||
6.20%, 07/18/11 | 206,000 | 208,553 | |||||||
5.25%, 11/15/13 | 590,000 | 562,195 | |||||||
4.95%, 09/30/14 | 295,000 | 273,325 | |||||||
5.25%, 10/01/15 | 295,000 | 274,310 | |||||||
6.00%, 09/30/34 | 230,000 | 207,212 | |||||||
UFJ Finance Aruba AEC, 6.75%, 07/15/13 | 354,000 | 373,786 | |||||||
XL Capital Ltd., 5.25%, 09/15/14 | 779,000 | 743,569 | |||||||
10,315,460 | |||||||||
Service Companies (0.1%) | |||||||||
British Sky Broadcasting Group PLC, 8.20%, 07/15/09 | 221,000 | 231,779 | |||||||
Thomson Corp., 4.25%, 08/15/09 | 251,000 | 244,619 | |||||||
TXU Energy Co., 6.15%, 11/15/13 (b) | 189,000 | 191,110 | |||||||
667,508 | |||||||||
Telephones (0.3%) | |||||||||
America Movil SA de CV | |||||||||
5.75%, 01/15/15 | 295,000 | 291,016 | |||||||
6.38%, 03/01/35 | 177,000 | 173,868 |
Yankee Dollars (continued) | |||||||||
Principal | |||||||||
Amount | Value | ||||||||
Telephones (continued) | |||||||||
British Telecom PLC | |||||||||
8.35%, 12/15/10 | $ | 1,280,000 | $ | 1,398,744 | |||||
9.15%, 12/15/30 | 559,000 | 731,611 | |||||||
France Telecom, 3,111.00%, 03/01/11 | 383,000 | 409,188 | |||||||
Koninklijke KPN NV, 8.00%, 10/01/10 | 310,000 | 331,785 | |||||||
Telefonos de Mexico SA, 5.50%, 01/27/15 | 236,000 | 229,389 | |||||||
Vodafone Group PLC | |||||||||
7.75%, 02/15/10 | 383,000 | 402,304 | |||||||
5.00%, 12/16/13 | 664,000 | 630,435 | |||||||
7.88%, 02/15/30 | 206,000 | 230,514 | |||||||
4,828,854 | |||||||||
Transportation (0.1%) | |||||||||
Canadian National Railway Co. | |||||||||
4.40%, 03/15/13 | 1,035,000 | 968,599 | |||||||
6.90%, 07/15/28 | 242,000 | 258,992 | |||||||
6.20%, 06/01/36 | 236,000 | 230,317 | |||||||
Qantas Airways, 6.05%, 04/15/16 (b) | 177,000 | 171,829 | |||||||
1,629,737 | |||||||||
Total Yankee Dollars (Cost $32,822,724) | 32,208,415 | ||||||||
Nomura Securities, 5.20% dated 06/29/07, due 07/02/07, repurchase price $14,591,271, collateralized by U.S. Government Agency Mortgages with a market value of $14,876,650 | $ | 14,584,951 | $ | 14,584,951 | |||||
Total Investments (Cost $1,591,051,316) (c) — 106.1% | 1,566,922,839 | ||||||||
Liabilities in excess of other assets — (6.1)% | (89,861,691 | ) | |||||||
NET ASSETS — 100.0% | $ | 1,477,061,148 | |||||||
(a) | Variable Rate Security. The rate reflected in the Statement of Investments is the rate in effect on June 30, 2007. The maturity date represents the actual maturity date. | |
(b) | Illiquid security. | |
(c) | See notes to financial statements for tax unrealized appreciation (depreciation) of securities. |
NVIT Bond Index
U.S. Government Agency Long-Term Obligations — Short Positions (4.3%) | |||||||||
Principal | |||||||||
Amount | Value | ||||||||
Federal National Mortgage Association TBA, | |||||||||
5.00%, 06/15/37 | $ | 3,000,000 | $ | 2,811,081 | |||||
Federal National Mortgage Association TBA, | |||||||||
5.00%, 07/01/37 | 64,700,000 | 60,615,813 | |||||||
Total U.S. Government Agency Long-Term Obligations — Short Positions (Proceeds $63,141,672) | 63,426,894 | ||||||||
Total Securities Sold Short (Proceeds $63,141,672) (a) — 4.3% | $ | 63,426,894 | |||||||
(a) | See notes to financial statements for tax unrealized appreciation (depreciation) of securities. |
TBA | To Be Announced. |
NVIT | ||||||
Bond Index | ||||||
Assets: | ||||||
Investments, at value (cost $1,576,466,365) | $ | 1,552,337,888 | ||||
Repurchase agreements, at cost and value | 14,584,951 | |||||
Total Investments | 1,566,922,839 | |||||
Cash | 58,348 | |||||
Interest and dividends receivable | 13,768,925 | |||||
Receivable for investments sold | 101,487,326 | |||||
Total Assets | 1,682,237,438 | |||||
Liabilities: | ||||||
Payable for investments purchased | 141,141,754 | |||||
Payable for capital shares redeemed | 191,785 | |||||
Securities sold short, at value (proceeds $63,141,672) | 63,426,894 | |||||
Accrued expenses and other payables: | ||||||
Investment advisory fees | 263,515 | |||||
Fund administration and transfer agent fees | 97,574 | |||||
Compliance program costs | 5,638 | |||||
Other | 49,130 | |||||
Total Liabilities | 205,176,290 | |||||
Net Assets | $ | 1,477,061,148 | ||||
Represented by: | ||||||
Capital | $ | 1,501,454,399 | ||||
Accumulated net investment income | 1,872,817 | |||||
Accumulated net realized losses from investment transactions and futures | (1,852,369 | ) | ||||
Net unrealized depreciation on investments | (24,413,699 | ) | ||||
Net Assets | $ | 1,477,061,148 | ||||
Net Assets: | ||||||
Class ID Shares | $ | 1,477,061,148 | ||||
Shares outstanding (unlimited number of shares authorized): | ||||||
Class ID Shares | 150,232,448 | |||||
Net asset value and offering price per share (Net assets by class divided by shares outstanding by class, respectively): | ||||||
Class ID Shares | $ | 9.83 | ||||
37
NVIT Bond Index | ||||||
INVESTMENT INCOME: | ||||||
Interest income | $ | 14,564,063 | ||||
Total Income | 14,564,063 | |||||
Expenses: | ||||||
Investment advisory fees | 600,795 | |||||
Fund administration and transfer agent fees | 199,623 | |||||
Custodian fees | 14,876 | |||||
Trustee fees | 15,640 | |||||
Compliance program costs (Note 3) | 5,638 | |||||
Other | 51,062 | |||||
Total expenses before earnings credit | 887,634 | |||||
Earnings credit (Note 6) | (590 | ) | ||||
Net Expenses | 887,044 | |||||
Net Investment Income | 13,677,019 | |||||
REALIZED/ UNREALIZED GAINS (LOSSES) FROM INVESTMENTS: | ||||||
Net realized losses on investment transactions | (1,843,443 | ) | ||||
Net realized losses on futures transactions | (8,926 | ) | ||||
Net realized losses on investment transactions and futures | (1,852,369 | ) | ||||
Net change in unrealized depreciation on investments | (24,413,699 | ) | ||||
Net realized/unrealized gains (losses) on investments | (26,266,068 | ) | ||||
CHANGE IN NET ASSETS RESULTING FROM OPERATIONS | $ | (12,589,049 | ) | |||
(a) | For the period from April 20, 2007 (commencement of operations) through June 30, 2007. |
38
NVIT Bond | |||||
Index | |||||
FROM INVESTMENT ACTIVITIES: | |||||
Operations: | |||||
Net investment income | $ | 13,677,019 | |||
Net realized losses on investment transactions and futures | (1,852,369 | ) | |||
Net change in unrealized depreciation on investments and futures | (24,413,699 | ) | |||
Change in net assets resulting from operations | (12,589,049 | ) | |||
Distributions to Shareholders from: | |||||
Net investment income: | |||||
Class ID | (11,804,202 | ) | |||
Change in net assets from shareholder distributions | (11,804,202 | ) | |||
Change in net assets from capital transactions | 1,501,454,399 | ||||
Change in net assets | 1,477,061,148 | ||||
Net Assets: | |||||
Beginning of period | — | ||||
End of period | $ | 1,477,061,148 | |||
Accumulated net investment income at end of period | $ | 1,872,817 | |||
CAPITAL TRANSACTIONS: | |||||
Class ID Shares | |||||
Proceeds from shares issued | $ | 84,630,085 | |||
Proceeds from in-kind transactions | 1,416,739,253 | ||||
Dividends reinvested | 11,804,077 | ||||
Cost of shares redeemed (b) | (11,719,016 | ) | |||
Change in net assets from capital transactions | $ | 1,501,454,399 | |||
SHARE TRANSACTIONS: | |||||
Class ID Shares | |||||
Issued | 8,535,444 | ||||
Proceeds from in-kind transactions | 141,673,925 | ||||
Reinvested | 1,203,270 | ||||
Redeemed | (1,180,191 | ) | |||
Total change in shares | 150,232,448 | ||||
(a) | For the period from April 20, 2007 (commencement of operations) through June 30, 2007. | |
(b) | Includes redemption fees, if any. |
39
Distributions | ||||||||||||||||||||||||||||||||
Investment Activities | ||||||||||||||||||||||||||||||||
Net Realized | ||||||||||||||||||||||||||||||||
and | ||||||||||||||||||||||||||||||||
Net Asset | Unrealized | Total | ||||||||||||||||||||||||||||||
Value, | Net | Gains | from | Net | Net Asset | |||||||||||||||||||||||||||
Beginning | Investment | (Losses) on | Investment | Investment | Total | Value, End | Total | |||||||||||||||||||||||||
of Period | Income | Investments | Activities | Income | Distributions | of Period | Return (a) | |||||||||||||||||||||||||
Class ID Shares | ||||||||||||||||||||||||||||||||
For the six months ended June 30, 2007 (Unaudited) (e) | $10.00 | 0.09 | (0.18 | ) | (0.09 | ) | (0.08 | ) | (0.08 | ) | $9.83 | (0.90%) |
[Additional columns below]
[Continued from above table, first column(s) repeated]
Ratios / Supplemental Data | ||||||||||||||||||||||||||
Ratio of | Ratio of Net | |||||||||||||||||||||||||
Ratio of Net | Expenses | Investment | ||||||||||||||||||||||||
Ratio of | Investment | (Prior to | Income | |||||||||||||||||||||||
Net Assets | Expenses | Income to | Reimbursements) | (Prior to | ||||||||||||||||||||||
at End of | to Average | Average | to Average | Reimbursements) | ||||||||||||||||||||||
Period | Net | Net | Net | to Average | Portfolio | |||||||||||||||||||||
(000s) | Assets (b) | Assets (b) | Assets (b)(c) | Net Assets (b)(c) | Turnover (d) | |||||||||||||||||||||
Class ID Shares | ||||||||||||||||||||||||||
For the six months ended June 30, 2007 (Unaudited) (e) | $1,477,061 | 0.32% | 0.32% | 0.32% | 0.32% | 36.74% |
(a) | Not annualized for periods less than one year. |
(b) | Annualized for periods less than one year. |
(c) | During the period, certain fees were waived and/or reimbursed. If such waivers/reimbursements had not occurred, the ratios would have been as indicated. |
(d) | Portfolio turnover is calculated on the basis of the Fund as a whole without distinguishing among the classes of shares. |
(e) | For the period from April 20, 2007 (commencement of operations) through June 30, 2007. |
1. Organization
Nationwide Variable Insurance Trust (“NVIT” or the “Trust”) is an open-end management investment company, organized under the laws of Delaware by an amended and restated Agreement and Declaration of Trust, dated October 28, 2004, as amended to date. Prior to May 1, 2007, the Trust was named “Gartmore Variable Insurance Trust”. The Trust, originally created under the laws of Massachusetts as a Massachusetts business trust pursuant to a Declaration of Trust dated, as of June 30, 1981, and as subsequently amended, redomesticated as a Delaware Statutory Trust after the close of trading on April 29, 2005, and is registered under the Investment Company Act of 1940, as amended (the “1940 Act”). The redomestication was a change in statutory status and did not affect the operations of the Trust. As of June 30, 2007, the Trust had authorized an unlimited number of shares of beneficial interest, without par value (“shares”). The Trust currently offers shares to life insurance company separate accounts to fund the benefits under variable life insurance or annuity policies. To date, only the separate accounts of Nationwide Life Insurance Company and Nationwide Life and Annuity Insurance Company (collectively, “Nationwide”) have purchased shares of the NVIT Bond Index Fund (the “Fund”), (formerly, “GVIT Bond Index Fund”). The Trust currently operates forty (40) separate series, or mutual funds, each with its own investment objectives and strategies. This report contains the financial statements and financial highlights of the Fund.
2. Summary of Significant Accounting Policies
The following is a summary of significant accounting policies followed by the Fund in the preparation of its financial statements. The policies are in conformity with accounting principles generally accepted in the United States of America (“GAAP”). The preparation of financial statements requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of income and expenses for the period. Actual results could differ from those estimates.
(a) | Security Valuation |
Securities for which market quotations are readily available are valued at current market value as of “Valuation Time.” Valuation Time is as of the close of regular trading on the New York Stock Exchange (usually 4 p.m. Eastern time). Equity securities are valued at the last quoted sale price or, if there is no sale price, the last quoted bid price provided by an independent pricing service approved by the Trust’s Board of Trustees (“Board of Trustees”). Securities traded on NASDAQ are valued at the NASDAQ official closing price. Prices are taken from the primary market or exchange in which each security trades. Investment companies are valued at net asset value as reported by such company. | |
Most securities listed on a foreign exchange are valued either at fair value (see description below) or at the last sale price at the close of the exchange on which the security is principally traded. Foreign securities, currencies, and other assets and liabilities denominated in foreign currencies are translated into U.S. dollars at the exchange rate of said currencies against the U.S. dollar, as of Valuation Time, as provided by an independent pricing service approved by the Board of Trustees. | |
Debt (including defaulted issues) and other fixed income securities (other than short-term obligations) are valued at the last quoted bid price and/or by using a combination of daily quotes and matrix evaluations provided by an independent pricing service, the use of which has been approved by the Board of Trustees. Short-term debt securities, such as commercial paper and U.S. Treasury Bills having a remaining maturity of 60 days or less at the time of purchase, are considered to be “short-term” and are valued at amortized cost, which approximates market value. | |
Securities for which market quotations are not readily available, or for which an independent pricing service does not provide a value or provides a value that does not represent fair value in the judgment of the Fund’s investment adviser or designee, are valued at fair value under procedures approved by the Board of Trustees. The “Fair Value” of these securities is determined in good faith by taking into account relevant factors and surrounding circumstances. Methods utilized to obtain a “Fair Value” may include the following non-exclusive list of acceptable methods: (i) a |
multiple of earnings; (ii) the discount from market value of a similar, freely traded security; (iii) the yield-to-maturity for debt issues; or (iv) a consolidation of the methods. The Trust’s Valuation & Operations Committee considers a non-exclusive list of factors to arrive at the appropriate method of determining “Fair Value.” For example, fair value determinations are required for securities whose value is affected by a “significant” event that materially affects the value of a domestic or foreign security which occurs subsequent to the time of the close of the principal market on which such domestic or foreign security trades and before the Valuation Time (i.e., a “subsequent event”). Typically, this will involve events occurring after the close of a foreign market on which a security trades and before the next Valuation Time. | |
The Fund values foreign securities at fair value in the circumstances described below. Generally, trading in foreign securities markets is completed each day at various times prior to the Valuation Time. Due to the time differences between the closings of the relevant foreign securities exchanges and the Valuation Time for the Fund, the Fund will fair value its foreign investments when it is determined that the market quotations for the foreign investments either are not readily available or are unreliable and, therefore, do not represent fair value. When the fair value prices are utilized, these prices will attempt to reflect the impact of the U.S. financial markets’ perceptions and trading activities on the Fund’s foreign investments since the last closing prices of the foreign investments were calculated on their primary foreign securities markets or exchanges. For these purposes, the Board of Trustees has determined that movements in relevant indices or other appropriate market indicators, after the close of the foreign securities exchanges, may demonstrate that market quotations are unreliable, and may trigger fair value pricing for certain securities. Consequently, fair valuation of portfolio securities may occur on a daily basis. |
(b) | Repurchase Agreements |
The Fund may enter into repurchase agreements with an entity which is a member of the Federal Reserve System or which is a “primary dealer” (as designated by the Federal Reserve Bank of New York) in U.S. Government obligations. The repurchase price generally equals the price paid by the Fund plus interest negotiated on the basis of current short-term rates, which may be more or less than the rate on the underlying portfolio securities. The seller under a repurchase agreement is required to maintain the value of the collateral held pursuant to the agreement at a market value equal to or greater than the repurchase price (including accrued interest). Collateral subject to repurchase agreements is held by the Fund’s custodian or another qualified sub-custodian or in the Federal Reserve/Treasury book-entry system. If the counterparty defaults and the fair value of the collateral declines, realization of the collateral by the Fund may be delayed or limited. The Fund may transfer uninvested cash balances into a pooled cash account. These balances are invested in one or more repurchase agreements, with the counterparty of Nomura Securities, which is fully collateralized by U.S. Government Agency Mortgages. |
(c) | Futures Contracts |
The Fund may invest in financial futures contracts (“futures contracts”) for the purpose of hedging its existing portfolio securities or securities that the Fund intends to purchase against fluctuations in value caused by changes in prevailing market interest rates or prices. Futures contracts may also be entered into for non-hedging purposes. | |
Upon entering into a futures contract, the Fund is required to pledge to the broker an amount of cash and/or other assets equal to a certain percentage of the contract amount (initial margin deposit). Subsequent payments, known as “variation margin,” are made each day, depending on the daily fluctuations in the fair value/market value of the underlying assets. A gain or loss equal to the daily variation margin is recognized on a daily basis. Futures contracts are valued daily at their last quoted sale price. | |
A “sale” of a futures contract means the creation of a contractual obligation to deliver the securities or foreign currency called for by the contract at a fixed price at a specified time in the future. A “purchase” of a futures contract means the creation of a contractual obligation to acquire the securities or foreign currency at a fixed price at a specified time in the future. |
Should market conditions change unexpectedly, the Fund may not achieve the anticipated benefits of the futures contracts and may realize a loss. The use of futures transactions for hedging purposes involves the risk of imperfect correlation in movements in the price of futures contracts, interest rates, and the value of the underlying hedged assets. |
(d) | Written Options Contracts |
The Fund may write options contracts. A written option obligates the Fund to deliver (written call) or to receive (written put) a specified quantity of an underlying asset at the contract amount upon exercise by the holder of the option. When the Fund writes an option, an amount equal to the premium received by the Fund is recorded as a liability and is subsequently adjusted to the current fair value of the option written. Premiums received from writing options that expire unexercised are treated by the Fund on the expiration date as realized gains from investments. The difference between the premium and the amount paid on effecting a closing purchase transaction, as a realized loss. If a call option is exercised, the premium is added to the proceeds from the sale of the underlying security or currency in determining whether the Fund has realized a gain or loss. If a put option is exercised, the premium reduces the cost basis of the securities purchased by the Fund. Options traded on an exchange are valued at the last quoted sale price, or in the absence of a sale, the bid price provided by an independent pricing service approved by the Board of Trustees. Non-exchange traded options are valued using dealer supplied quotes. The Fund as a writer of an option bears the market risk of an unfavorable change in the price of the security underlying the written option. |
(e) | Mortgage Dollar Rolls |
The Fund may enter into mortgage “dollar rolls” in which the Fund sells mortgage-backed securities for delivery in the current month and simultaneously contracts to repurchase substantially similar (same type, coupon, and maturity) securities on a specified future date. Mortgage dollar rolls may be implemented in the “to be announced” (“TBA”) market and are referred to as TBAs on the Statement of Investments of the Fund. During the roll period, the Fund foregoes principal and interest paid on the mortgage-backed securities. Each mortgage dollar roll is treated as a financing transaction; therefore, any gain or loss is considered unrealized until the roll reaches completion. Risks may arise due to the delayed payment date and the potential inability of counterparties to complete the transaction. Income is generated as consideration for entering into these transactions and is included in interest income on the Statement of Operations. |
(f) | Security Transactions and Investment Income |
Security transactions are accounted for on the date the security is purchased or sold (“trade date”). Securities gains and losses are calculated on the identified cost basis. Interest income is recognized on the accrual basis and includes, where applicable, the amortization or accretion of premium or discount. Dividend income is recorded on the ex-dividend date. |
(g) | Securities Lending |
To generate additional income, the Fund may lend its portfolio securities, up to 33 1/3% of the Fund, to brokers, dealers and other financial institutions provided that (1) the borrower delivers cash or securities as collateral with respect to each new loan of U.S. securities, equal to at least 102% of the value of the portfolio securities loaned, and with respect to each new loan on non-U.S. securities, collateral of at least 105% of the value of the portfolio securities loaned; and (2) at all times thereafter shall require the borrower to mark-to-market the collateral on a daily basis so that the market value of such collateral does not fall below 100% of the value of securities loaned. The Fund receives payments from borrowers equivalent to the dividends and interest that would have been earned on securities loaned while simultaneously seeking to earn income on the investment of cash collateral. There may be risks of delay in recovery of the securities should the borrower of the securities fail financially. Loans will be made, however, only to borrowers deemed by the Fund’s investment adviser to be of good standing and creditworthy under guidelines established by the Board of Trustees and when, in judgment of the adviser, the consideration which can be earned |
currently from these securities loans justifies the attendant risks. Loans are subject to termination by the Fund or the borrower at any time, and, therefore, are not considered to be illiquid investments. JPMorgan Chase Bank serves as custodian for the securities lending program of the Fund. JPMorgan Chase Bank receives a fee based on the value of the collateral received from borrowers. As of June 30, 2007, the Fund did not have securities on loan. |
(h) | Distributions to Shareholders |
The Fund’s dividends from net investment income, if any, are declared and paid quarterly. The Fund’s distributions from net realized capital gains, if any, are declared and distributed at least annually. | |
Dividends and distributions to shareholders are determined in accordance with federal income tax regulations, which may differ from GAAP. These “book/tax” differences are considered either permanent or temporary in nature. In accordance with the American Institute of Certified Public Accountants Statement of Position 93-2, permanent differences (i.e., reclassification of market discounts, foreign exchange gain/loss, paydowns, and distributions from real estate investment trusts) are reclassified within the capital accounts based on their nature for federal income tax purposes; temporary differences do not require reclassification. These reclassifications have no effect upon the net asset value of the Fund. To the extent distributions exceed current and accumulated earnings and profits for federal income tax purposes, these distributions are reported as distributions of paid-in-capital. |
(i) | Federal Income Taxes |
It is the policy of the Fund to qualify or to continue to qualify as a “regulated investment company” by complying with the provisions available to certain investment companies, as defined in Subchapter M of the U.S. Internal Revenue Code, and to make distributions of net investment income and net realized capital gains sufficient to relieve the Fund from all, or substantially all, federal income taxes. | |
As of June 30, 2007, the tax cost of securities and the breakdown of unrealized appreciation (depreciation) for the Fund was as follows: |
Net Unrealized | ||||||||||||||
Tax Cost of | Unrealized | Unrealized | Appreciation | |||||||||||
Securities | Appreciation | Depreciation | (Depreciation) | |||||||||||
$ | 1,531,708,086 | $ | 1,090,280 | $ | (29,302,421 | ) | $ | (28,212,141 | ) |
(j) | Allocation of Expenses, Income, and Gains and Losses |
Expenses directly attributable to the Fund are charged to the Fund. Expenses not directly attributable to the Fund are allocated proportionately among various or all funds within the Trust. The method used by the Fund for allocating income, fund level expenses, and realized and unrealized gains or losses is based on the fair value of shares outstanding relative to net assets. Under this method, each class of shares participates based on the total net asset value of that class’s shares in proportion to the total net assets of the Fund. Expenses specific to a class (such as Rule 12b-1 and administrative services fees) are charged to that class. |
3. Transactions with Affiliates
Under the terms of the Trust’s Investment Advisory Agreement, Nationwide Fund Advisors (formerly, Gartmore Mutual Fund Capital Trust (“GMF”)) (“NFA” or the “Advisor”) manages the investment of the assets and supervises the daily business affairs of the Fund. NFA is a wholly-owned subsidiary of Nationwide Financial Services (“NFS”). In addition, NFA provides investment management evaluation services in initially selecting and monitoring, on an ongoing basis, the performance of the subadviser. BlackRock Investment Management, LLC (the “subadviser”), manages all of the Fund’s investments and has the responsibility for making all investment decisions for the Fund.
Under the terms of the Investment Advisory Agreement, the Fund pays the Fund’s adviser an investment advisory fee based on the Fund’s average daily net assets. Additional information regarding investment advisory fees and subadvisory fees for NFA and the subadviser is as follows for the period ended June 30, 2007:
Total | ||||||
Fee Schedule | Fees | |||||
$0 up to $1.5 billion | 0.22% | |||||
$1.5 billion up to $3 billion | 0.21% | |||||
$3 billion or more | 0.20% | |||||
From such fees, pursuant to the subadvisory agreement, NFA paid the subadviser $218,473 for the period ended June 30, 2007.
NFA and the Fund have entered into a written contract (“Expense Limitation Agreement”) that limits operating expenses (excluding any taxes, interest, brokerage fees, Rule 12b-1 fees, short-sale dividend expenses, administrative services fees, other expenses which are capitalized in accordance with generally accepted accounting principles and may exclude other non-routine expenses not incurred in the ordinary course of the Fund’s business) from exceeding 0.32% until at least May 1, 2008.
NFA may request and receive reimbursement from the Fund of the advisory fees waived and other expenses reimbursed by NFA, respectively, pursuant to the Expense Limitation Agreement at a later date not to exceed three years from the fiscal year in which the corresponding reimbursement to the Fund was made, (as described below), if the Fund has reached a sufficient asset size to permit reimbursement to be made without causing the total annual operating expense ratio of the Fund to exceed the limits set forth above. No reimbursement will be made unless: (i) the Fund’s assets exceed $100 million; (ii) the total annual expense ratio of the Class making such reimbursement is less than the limit set forth above; and (iii) the payment of such reimbursement is approved by the Board of Trustees on a quarterly basis. Except as provided for in the Expense Limitation Agreement, reimbursement of amounts previously waived or assumed by NFA is not permitted.
Under the terms of a Fund Administration and Transfer Agency Agreement, Nationwide Fund Management, LLC (formerly, Gartmore Investor Services, Inc. (“GISI”)) (“NFM”), a wholly-owned subsidiary of NFS Distributors, Inc. (“NFSDI”), provides the Fund with various administrative and accounting services for the Fund (prior to May 1, 2007, this service was provided by Gartmore SA Capital Trust (“GSA”)), and serves as Transfer and Dividend Disbursing Agent for the Fund (prior to May 1, 2007, this service was provided by GISI, an indirect subsidiary of GSA). The fees for the services provided under this Agreement are calculated based on the Trust’s average daily net assets according to the fee schedule below. The fees are then allocated proportionately among all funds within the Trust in relation to the average daily net assets of each fund and are paid to NFA. NFA pays NFM from these fees for NFM’s services.
Combined Fee Schedule* | ||||||
Up to $1 billion | 0.15% | |||||
$1 billion up to $3 billion | 0.10% | |||||
$3 billion up to $8 billion | 0.05% | |||||
$8 billion up to $10 billion | 0.04% | |||||
$10 billion up to $12 billion | 0.02% | |||||
$12 billion or more | 0.01% | |||||
* | The assets of the Nationwide NVIT Investor Destinations Aggressive Fund, the Nationwide NVIT Investor Destinations Moderately Aggressive Fund, the Nationwide NVIT Investor Destinations Moderate Fund, the Nationwide NVIT Investor Destinations Moderately Conservative Fund, and the Nationwide NVIT Investor Destinations Conservative Fund (collectively, the “Investor Destinations Funds”) are excluded from the Trust asset level amount in order to calculate this asset-based fee. The Investor Destinations Funds do not pay any part of this fee. |
NFA and NFM have entered into agreements with Citi Fund Services Ohio, Inc. (“Citi”), pursuant to which Citi provides sub-administration and sub-transfer agency services, respectively, to the Fund. Effective August 1, 2007, The BISYS Group Inc. was acquired by and became a wholly owned subsidiary of Citi.
Under the terms of a Distribution Plan under Rule 12b-1 of the 1940 Act, Nationwide Fund Distributors, LLC. (formerly, “Gartmore Distribution Services, Inc. (“GDSI”)) (“NFD” or “Distributor”), the Fund’s principal underwriter, is compensated by the Fund for expenses associated with the distribution of the Class II and Class VII shares of the Fund. NFD is a wholly-owned subsidiary of NFSDI. These fees are based on average daily net assets of Class II and Class VII shares of the Fund at an annual rate not to exceed 0.25% for Class II shares and 0.40% for Class VII shares.
Under the terms of an Administrative Services Plan, the Fund may pay fees to servicing organizations, such as broker-dealers, including NFS, and financial institutions, which agree to provide administrative support services to the shareholders of certain classes. These services include, but are not limited, to the following: establishing and maintaining shareholder accounts; processing purchase and redemption transactions; arranging bank wires; performing shareholder sub-accounting; answering inquires regarding the Fund; and other such services. These fees are based on an annual rate of up to 0.25% of the average daily net assets of Class II and Class VII shares of the Fund.
Under the terms of a letter agreement dated September 12, 2006, by and among NFA, the Audit Committee of the Trust and the Trust, the Trust has agreed to reimburse NFA certain costs related to the Fund’s portion of ongoing administration, monitoring and annual (audit) testing of the Trust’s Rule 38a-1 Compliance Program subject to the pre-approval of the Trust’s Audit Committee. For the period ended June 30, 2007, the Fund’s portion of such costs amounted to $5,638.
4. Investment Transactions
For the period ended June 30, 2007, (excluding short-term securities) the Fund had purchases of $628,417,913 and sales of $530,185,016.
For the period ended June 30, 2007, the Fund had purchases of $955,519,568 and sales of $599,931,394 of U.S. Government securities.
5. Bank Loans and Earnings Credit
The Trust has a credit agreement with JPMorgan Chase & Co., the Fund’s custodian bank, permitting the Trust to borrow up to $100,000,000. Borrowings under this arrangement bear interest at the Federal Funds rate plus 0.50%. The interest costs, if any, would be included in other fees in the Statement of Operations. No compensating balances were required under the terms of the line of credit. The line of credit is renewed annually, expiring on June 25, 2008, with a commitment fee of 0.07% per year on $100,000,000. There were no borrowings outstanding under this line of credit for the period ended June 30, 2007.
The Trust’s custodian bank has agreed to reduce the bank’s fees (earnings credit) when the Funds of the Trust maintain cash on deposit in non-interest-bearing custody and Demand Deposit Accounts. Earnings credits, if any, are shown as a reduction of total expenses on the Statement of Operations.
6. Indemnifications
Under the Trust’s organizational documents, certain of the Trust’s Officers and Trustees are indemnified against certain liabilities arising out of the performance of their duties to the Trust. In addition, the Trust has entered into Indemnification Agreements with the Trust’s trustees and certain officers covering similar liabilities. Trust Officers receive no compensation from the Trust for serving as the Trust’s Officers. In addition, in the normal course of business, the Trust enters into contracts with its vendors and others that provide for general indemnifications. The Trust’s maximum exposure under these arrangements is unknown, as this would involve future claims that may be made against the Trust. Based on experience, however, the Trust expects that risk of loss to be remote.
7. Recently Issued Accounting Pronouncements
On July 13, 2006, the Financial Accounting Standards Board (“FASB”) released FASB Interpretation No. 48, Accounting for Uncertainty in Income Taxes (“FIN 48”). FIN 48 provides guidance for how uncertain tax positions should be recognized, measured, presented and disclosed in the financial statements. FIN 48 requires the affirmative evaluation of tax positions taken or expected to be taken in the course of preparing the Fund’s tax returns to determine whether it is more-likely-than-not (i.e., greater than 50 percent) that each tax position will be sustained upon examination by a taxing authority based on the technical merits of the position. A tax position that meets the more-likely-than-not recognition threshold is measured to determine the amount of benefit to recognize in the financial statements. Differences between tax positions taken in a tax return and amounts recognized in the financial statements will generally result in an increase in a liability for taxes payable (or a reduction of a tax refund receivable) and an increase in a deferred tax liability (or a reduction in a deferred tax asset). Adoption of FIN 48 was required no later than the last business day of the first financial statement reporting period for fiscal years beginning after December 15, 2006 and is to be applied to all open tax years as of the effective date. Accordingly, the Fund was required to implement FIN 48 in its net asset value per share (NAV) calculation on June 29, 2007. Management has evaluated the implications of FIN 48 and has concluded that there was no impact to the Fund’s financial statements as of June 29, 2007. The adoption of FIN 48 requires ongoing monitoring and analysis, future conclusions reached by management may be different and result in adjustments to the Fund’s NAV and financial statements.
In September 2006, the FASB issued Statement on Financial Accounting Standards (“SFAS”) No. 157, “Fair Value Measurements.” This standard establishes a single authoritative definition of fair value, sets out a framework for measuring fair value and requires additional disclosures about fair value measurements. SFAS No. 157 applies to fair value measurements already required or permitted by existing standards. SFAS No. 157 is effective for financial statements issued for fiscal years beginning after November 15, 2007 and interim periods within those fiscal years. The changes to current accounting principles generally accepted in the United States of America from the application of this Statement relate to the definition of fair value, the methods used to measure fair value, and the expanded disclosures about fair value measurements. As of June 30, 2007, the Fund does not believe the adoption of SFAS No. 157 will impact the financial statement amounts; however, additional disclosures may be required about the inputs used to develop the measurements and the effect of certain of the measurements on changes in net assets for the period.
Trustees who are not Interested Persons (as defined in the 1940 Act) and Officers of the Trust as of June 30, 2007
Number of | ||||||||||
Position(s) Held | Portfolios in the | |||||||||
with the Trust | Principal Occupation(s) | Nationwide Fund | Other | |||||||
Name, Address | and Length of | During Past | Complex Overseen | Directorships | ||||||
and Year of Birth | Time Served1 | Five Years | by Trustee | Held by Trustee2 | ||||||
Charles E. Allen c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1948 | Trustee since July 2000 | Mr. Allen is Chairman, Chief Executive Officer and President of Graimark Realty Advisors, Inc. (real estate development, investment and asset management). | 89 | None | ||||||
Paula H.J. Cholmondeley c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1947 | Trustee since July 2000 | Ms. Cholmondeley was Vice President and General Manager of Sappi Fine Paper North America from April 2000 through December 2003. | 89 | Director of Dentsply International, Inc.(dental products), Ultralife Batteries, Inc., Terex Corporation (construction equipment), Minerals Technology, Inc. (specialty chemicals) and Albany International Corp. (paper industry) | ||||||
C. Brent DeVore3 c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1940 | Trustee since 1990 | Dr. DeVore is President of Otterbein College. | 89 | None | ||||||
Phyllis Kay Dryden c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1947 | Trustee since December 2004 | Ms. Dryden was a partner of Mitchell Madison, a management consulting company from January 2006 until December 2006; she is currently a consultant with the company. Ms. Dryden was formerly Managing Partner of marchFIRST, a global management consulting firm. | 89 | None | ||||||
Barbara L. Hennigar c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1935 | Trustee since July 2000 | Retired. | 89 | None |
Number of | ||||||||||
Position(s) Held | Portfolios in the | |||||||||
with the Trust | Principal Occupation(s) | Nationwide Fund | Other | |||||||
Name, Address | and Length of | During Past | Complex Overseen | Directorships | ||||||
and Year of Birth | Time Served1 | Five Years | by Trustee | Held by Trustee2 | ||||||
Barbara I. Jacobs c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1950 | Trustee since December 2004 | Ms. Jacobs served as Chairman of the Board of Directors of KICAP Network Fund, a European (United Kingdom) hedge fund, from January 2001 through January 2006. From 1998-2003, Ms. Jacobs was also a Managing Director and European Portfolio Manager of CREF Investments (Teachers Insurance and Annuity Association — College Retirement Equities Fund). | 89 | None | ||||||
Douglas F. Kridler c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1955 | Trustee since September 1997 | Mr. Kridler has served as the President and Chief Executive Officer of the Columbus Foundation (a Columbus, OH-based foundation which manages over 1,300 individual endowment funds) since February 2002. Prior to January 31, 2002, Mr. Kridler was the President of the Columbus Association for the Performing Arts and Chairman of the Greater Columbus Convention and Visitors Bureau. | 89 | None | ||||||
Michael D. McCarthy c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1947 | Trustee since December 2004 | Retired. Mr. McCarthy was Chairman of VMAC (commodity swaps) from October 2002 until January 2007; and a partner of Pineville Properties LLC (a commercial real estate development firm) from September 2000 until January 2007. | 89 | None | ||||||
David C. Wetmore c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1948 | Trustee since 1995 and Chairman since February 2005 | Retired. | 89 | None | ||||||
1 | Length of time served includes time served with the Trust’s predecessors. | |
2 | Directorships held in (1) any other investment companies registered under the 1940 Act, (2) any company with a class of securities registered pursuant to Section 12 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or (3) any company subject to the requirements of Section 15(d) of the Exchange Act. | |
3 | Mr. DeVore has served as President of Otterbein College since 1984. Mark Thresher, President and Chief Operating Officer of Nationwide Financial Services, Inc. (“NFS”) has served as a member of the Board of Trustees of Otterbein College since 2000, currently serves as one of 30 of its trustees, and is currently one of two Vice Chairmen of the Board. Each of Nationwide Fund Advisors (“NFA”), the Funds’ investment adviser, and Nationwide Fund Distributors LLC (“NFD”), principal underwriter to the Trust, is a wholly-owned subsidiary of NFS. | |
Additional information regarding the Trustees and Officers may be found in the Trust’s Statement of Additional Information, which is available without charge upon request, by calling 800-848-0920. |
Trustees who are Interested Persons (as defined in the 1940 Act) and/or Officers of the Trust as of June 30, 2007
Number of | ||||||||||
Position(s) Held | Portfolios in the | |||||||||
with the Trust | Principal Occupation(s) | Nationwide Fund | Other | |||||||
Name, Address | and Length of | During Past | Complex Overseen | Directorships | ||||||
and Year of Birth | Time Served1 | Five Years | by Trustee | Held by Trustee2 | ||||||
Arden L. Shisler c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1941 | Trustee since February 2000 | Retired. Mr. Shisler is the former President and Chief Executive Officer of KeB Transport, Inc., a trucking firm (2000 through 2002). He served as a consultant to KeB from January 2003 through December 2004. Since 1992, Mr. Shisler has also been Chairman of the Board for Nationwide Mutual Insurance Company.3 | 89 | Director of Nationwide Financial Services, Inc., Chairman of Nationwide Mutual Insurance Company3 | ||||||
John H. Grady Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1961 | President & Chief Executive Officer since December 2006 | Mr. Grady is President, and Chief Executive Officer of Nationwide Funds Group which includes Nationwide Fund Advisors,3 Nationwide Fund Management LLC,3 Nationwide Fund Distributors LLC 3 and NWD Investments,2 the asset management operations of Nationwide Mutual Insurance Company, which includes Morley Capital Management, Inc.,2 Nationwide Separate Accounts LLC,2 NorthPointe Capital LLC,2 and Nationwide SA Capital Trust2. From March 2004 until March 2006, Mr. Grady was Chief Executive Officer of Constellation Investment Management Co., L.P. (registered investment adviser), and President and Chief Executive Officer of Constellation Funds Group (registered investment companies). He also was President of Constellation Investment Distribution Co., Inc. (registered broker-dealer) from March 2004 until June 2006. From February 2001 until February 2004, Mr. Grady was Chief Operating and Chief Legal Officer; Managing Director, Mutual Funds Group, Turner Investment Partners, Inc. (registered investment adviser); Executive Vice President of Turner Funds and Turner Institutional Portfolios (registered investment companies); and President, Turner Investment Distributors, Inc. (registered broker-dealer). | N/A | None | ||||||
Gerald J. Holland Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken,PA 19428 1951 | Treasurer since March 2001 | Mr. Holland is Senior Vice President — Operations for Nationwide Funds Group3. | N/A | N/A |
Number of | ||||||||||
Position(s) Held | Portfolios in the | |||||||||
with the Trust | Principal Occupation(s) | Nationwide Fund | Other | |||||||
Name, Address | and Length of | During Past | Complex Overseen | Directorships | ||||||
and Year of Birth | Time Served1 | Five Years | by Trustee | Held by Trustee2 | ||||||
Michael A. Krulikowski Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1959 | Chief Compliance Officer from June 2004 to August 20074 | Mr. Krulikowski is Vice President and Chief Compliance Officer of Nationwide Funds Group3, Morley Capital Management, Inc.3 , Nationwide SA Capital Trust (since 1999)3, and Nationwide Separate Accounts LLC (since August 2005).3 Since June 2004, Mr. Krulikowski has also served as Chief Compliance Officer of the Trust. From November 1999 through May 2007, he served as Vice President and Chief Compliance Officer of NorthPointe Capital LLC. 3 | N/A | N/A | ||||||
Eric E. Miller Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1953 | Secretary since December 2002 | Mr. Miller is Senior Vice President, General Counsel, and Assistant Secretary for Nationwide Funds Group3 and NWD Investments.2 From August 2000 to August 2002, Mr. Miller was a Partner with Stradley Ronon Stevens & Young, LLP. | N/A | N/A | ||||||
1 | Length of time served includes time served with the Trust’s predecessors. | |
2 | Directorships held in (1) any other investment companies registered under the 1940 Act, (2) any company with a class of securities registered pursuant to Section 12 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or (3) any company subject to the requirements of Section 15(d) of the Exchange Act. | |
3 | This position is held with an affiliated person or principal underwriter of the Trust. | |
4 | Effective August 3, 2007, the Board of Trustees approved Carol Baldwin Moody as Chief Compliance Officer of the Trust. Since November 2005, Ms. Moody has been Senior Vice President, Chief Compliance Officer of Nationwide Financial Services, Nationwide Life Insurance Company, Nationwide Life and Annuity Insurance Company, and Nationwide Investment Advisors, LLC. From February 2004-November 2005, she was Chief Compliance Officer of TIAA-CREF and from April 2000-February 2004, she was Managing Director and General Counsel, TCW/ Latin America Partners, LLC and Baeza & Co., LLC. | |
Federal law requires the Trust, each of its investment advisers and sub-advisers to adopt procedures for voting proxies (“Proxy Voting Guidelines”) and to provide a summary of those Proxy Voting Guidelines used to vote the securities held by the Funds. The Funds’ proxy voting policies and procedures are available without charge (i) upon request, by calling 800-848-0920, (ii) on the Funds’ website at www.nationwidefunds.com, or (iii) on the Securities and Exchange Commission’s website at www.sec.gov. |
A. Submission of Matters to a Vote of Security Holders:
On April 25, 2007, a Special Meeting of Shareholders was held* (the “April 25 Meeting”) at which shareholders of the Funds** set forth below were asked:
Proposal 1:
To approve a new investment advisory agreement, on behalf of their Fund, between Nationwide Fund Advisors (formerly “Gartmore Mutual Fund Capital Trust”) (the “Adviser”) and Nationwide Variable Insurance Trust (formerly “Gartmore Variable Insurance Trust”) (the “Trust”).
Number of Shares | ||||||||||
Fund | Cast/Not Cast | Percentages | ||||||||
Federated NVIT High Income Bond Fund | FOR | 30,051,703.188 shares | 92.514% | |||||||
(Formerly Federated GVIT High Income Bond Fund) | AGAINST | 618,245.021 shares | 1.903% | |||||||
ABSTAIN | 1,813,550.431 shares | 5.583% | ||||||||
TOTAL | 32,483,498.640 shares | |||||||||
NVIT International Index | FOR | 4,322,203.982 shares | 96.897% | |||||||
(Formerly GVIT International Index Fund) | AGAINST | 2,758.318 shares | 0.062% | |||||||
ABSTAIN | 135,636.840 shares | 3.041% | ||||||||
TOTAL | 4,460,599.140 shares | |||||||||
NVIT International Value Fund | FOR | 20,032,843.199 shares | 93.351% | |||||||
(Formerly GVIT International Value Fund) | AGAINST | 333,588.902 shares | 1.554% | |||||||
ABSTAIN | 1,093,293.879 shares | 5.095% | ||||||||
TOTAL | 21,459,725.980 shares | |||||||||
NVIT Mid Cap Index Fund | FOR | 35,380,179.120 shares | 94.154% | |||||||
(Formerly GVIT Mid Cap Index Fund) | AGAINST | 631,117.844 shares | 1.679% | |||||||
ABSTAIN | 1,565,714.306 shares | 4.167% | ||||||||
TOTAL | 37,577,011.270 shares | |||||||||
NVIT S&P 500 Index Fund | FOR | 56,119,814.230 shares | 95.554% | |||||||
(Formerly GVIT S&P 500 Index Fund) | AGAINST | 666,195.542 shares | 1.134% | |||||||
ABSTAIN | 1,944,898.888 shares | 3.312% | ||||||||
TOTAL | 58,730,908.660 shares | |||||||||
Nationwide Multi-Manager NVIT Small Cap Growth Fund | FOR | 7,632,918.513 shares | 92.700% | |||||||
(Formerly GVIT Small Cap Growth Fund) | AGAINST | 149,458.111 shares | 1.816% | |||||||
ABSTAIN | 451,583.036 shares | 5.484% | ||||||||
TOTAL | 8,233,959.660 shares | |||||||||
Nationwide Multi-Manager NVIT Small Cap Value Fund | FOR | 48,649,396.525 shares | 92.816% | |||||||
(Formerly GVIT Small Cap Value Fund) | AGAINST | 979,183.753 shares | 1.868% | |||||||
ABSTAIN | 2,786,133.102 shares | 5.316% | ||||||||
TOTAL | 52,414,713.380 shares | |||||||||
Nationwide Multi-Manager NVIT Small Company Fund | FOR | 29,903,181.700 shares | 91.311% | |||||||
(Formerly GVIT Small Company Fund) | AGAINST | 838,774.923 shares | 2.561% | |||||||
ABSTAIN | 2,006,741.307 shares | 6.128% | ||||||||
TOTAL | 32,748,697.930 shares | |||||||||
Gartmore NVIT Developing Markets Fund | FOR | 21,0177,889.443 shares | 91.460% | |||||||
(Formerly Gartmore GVIT Developing Markets Fund) | AGAINST | 424,272.958 shares | 1.841% | |||||||
ABSTAIN | 1,543,850.729 shares | 6.699% | ||||||||
TOTAL | 23,046,013.130 shares |
Number of Shares | ||||||||||
Fund | Cast/Not Cast | Percentages | ||||||||
Gartmore NVIT Emerging Markets Fund | FOR | 17,050,534.593 shares | 92.371% | |||||||
(Formerly Gartmore GVIT Emerging Markets Fund) | AGAINST | 526,574.722 shares | 2.853% | |||||||
ABSTAIN | 881,608.905 shares | 4.776% | ||||||||
TOTAL | 18,458,718.220 shares | |||||||||
Nationwide NVIT Global Financial Services Fund | FOR | 1,554,847.333 shares | 95.589% | |||||||
(Formerly Gartmore GVIT Global Financial Services Fund) | AGAINST | 19,539.033 shares | 1.201% | |||||||
ABSTAIN | 52,206.494 shares | 3.210% | ||||||||
TOTAL | 1,626,592.860 shares | |||||||||
Nationwide NVIT Global Health Sciences Fund | FOR | 4,722,963.678 shares | 92.815% | |||||||
(Formerly Gartmore GVIT Global Health Sciences Fund) | AGAINST | 157,979.030 shares | 3.104% | |||||||
ABSTAIN | 207,642.222 shares | 4.081% | ||||||||
TOTAL | 5,088,584.930 shares | |||||||||
Nationwide NVIT Global Technology and Communications Fund | FOR | 8,585,472.039 shares | 93.551% | |||||||
(Formerly Gartmore GVIT Global Technology | AGAINST | 102,267.977 shares | 1.114% | |||||||
and Communications Fund) | ABSTAIN | 489,577.634 shares | 5.335% | |||||||
TOTAL | 9,177,317.650 shares | |||||||||
Gartmore NVIT Global Utilities Fund | FOR | 4,123,270.549 shares | 91.923% | |||||||
(Formerly Gartmore GVIT Global Utilities Fund) | AGAINST | 122,001.533 shares | 2.720% | |||||||
ABSTAIN | 240,276.088 shares | 5.357% | ||||||||
TOTAL | 4,485,548.170 shares | |||||||||
Nationwide NVIT Government Bond Fund | FOR | 88,471,567.462 shares | 92.024% | |||||||
(Formerly Gartmore GVIT Government Bond Fund) | AGAINST | 1,825,645.181 shares | 1.899% | |||||||
ABSTAIN | 5,841,990.727 shares | 6.077% | ||||||||
TOTAL | 96,139,203.370 shares | |||||||||
Nationwide NVIT Growth Fund | FOR | 14,931,435.904 shares | 89.942% | |||||||
(Formerly Gartmore GVIT Growth Fund) | AGAINST | 409,826.402 shares | 2.469% | |||||||
ABSTAIN | 1,259,945.064 shares | 7.589% | ||||||||
TOTAL | 16,601,207.370 shares | |||||||||
Gartmore NVIT International Growth Fund | FOR | 6,251,419.070 shares | 93.569% | |||||||
(Formerly Gartmore GVIT International Growth Fund) | AGAINST | 139,618.548 shares | 2.090% | |||||||
ABSTAIN | 290,025.592 shares | 4.341% | ||||||||
TOTAL | 6,681,063.210 shares | |||||||||
Nationwide NVIT Investor Destinations Aggressive Fund | FOR | 49,489,224.549 shares | 90.688% | |||||||
(Formerly Gartmore GVIT Investor Destinations Aggressive Fund) | AGAINST | 1,385,396.474 shares | 2.539% | |||||||
ABSTAIN | 3,696,272.337 shares | 6.773% | ||||||||
TOTAL | 54,570,893.360 shares | |||||||||
Nationwide NVIT Investor Destinations Conservative Fund | FOR | 23,091,965.887 shares | 89.855% | |||||||
(Formerly Gartmore GVIT Investor Destinations Conservative Fund) | AGAINST | 314,935,884 shares | 1.225% | |||||||
ABSTAIN | 2,292,355.179 shares | 8.920% | ||||||||
TOTAL | 25,699,256.950 shares | |||||||||
Nationwide NVIT Investor Destinations Moderate Fund | FOR | 188,902,093.059 shares | 90.696% | |||||||
(Formerly Gartmore GVIT Investor Destinations Moderate Fund) | AGAINST | 3,018,924.590 shares | 1.449% | |||||||
ABSTAIN | 16,359,690.401 shares | 7.855% | ||||||||
TOTAL | 208,280,708.050 shares |
Number of Shares | ||||||||||
Fund | Cast/Not Cast | Percentages | ||||||||
Nationwide NVIT Investor Destinations Moderately Aggressive Fund | FOR | 134,792,622.920 shares | 91.332% | |||||||
(Formerly Gartmore GVIT Investor Destinations | AGAINST | 3,489,207.264 shares | 2.364% | |||||||
Moderately Aggressive Fund) | ABSTAIN | 9,304,197.656 shares | 6.304% | |||||||
TOTAL | 147,586,027.840 shares | |||||||||
Nationwide NVIT Investor Destinations Moderately Conservative Fund | FOR | 49,627,123.216 shares | 91.918% | |||||||
(Formerly Gartmore GVIT Investor Destinations | AGAINST | 856,088.634 shares | 1.586% | |||||||
Moderately Conservative Fund) | ABSTAIN | 3,507,215.650 shares | 6.496% | |||||||
TOTAL | 53,990,427.500 shares | |||||||||
Nationwide NVIT Mid Cap Growth Fund | FOR | 10,879,584.971 shares | 91.043% | |||||||
(Formerly Gartmore GVIT Mid Cap Growth Fund) | AGAINST | 352,594.958 shares | 2.950% | |||||||
ABSTAIN | 717,792.971 shares | 6.007% | ||||||||
TOTAL | 11,949,972.900 shares | |||||||||
Nationwide NVIT Money Market Fund II | FOR | 221,774,863.241 shares | 88.508% | |||||||
(Formerly Gartmore GVIT Money Market Fund II) | AGAINST | 12,322,482.494 shares | 4.918% | |||||||
ABSTAIN | 16,471,740.875 shares | 6.574% | ||||||||
TOTAL | 250,569,086.610 shares | |||||||||
Nationwide NVIT Money Market Fund | FOR | 1,578,331,008.328 shares | 91.585% | |||||||
(Formerly Gartmore GVIT Money Market Fund) | AGAINST | 32,372,133.671 shares | 1.878% | |||||||
ABSTAIN | 112,652,123.301 shares | 6.537% | ||||||||
TOTAL | 1,723,355,265.300 shares | |||||||||
NVIT Nationwide Fund | FOR | 125,423,274.735 shares | 91.581% | |||||||
(Formerly Gartmore GVIT Nationwide Fund) | AGAINST | 2,767,979.467 shares | 2.021% | |||||||
ABSTAIN | 8,762,255.828 shares | 6.398% | ||||||||
TOTAL | 136,953,510.030 shares | |||||||||
NVIT Nationwide Leaders Fund | FOR | 2,298,504.956 shares | 95.780% | |||||||
(Formerly Gartmore GVIT Nationwide Leaders Fund) | AGAINST | 29,630.469 shares | 1.235% | |||||||
ABSTAIN | 71,637.755 shares | 2.985% | ||||||||
TOTAL | 2,399,773.180 shares | |||||||||
Nationwide NVIT U.S. Growth Leaders Fund | FOR | 4,972,094.773 shares | 94.359% | |||||||
(Formerly Gartmore GVIT U.S. Growth Leaders Fund) | AGAINST | 122,623.161 shares | 2.327% | |||||||
ABSTAIN | 174,625.606 shares | 3.314% | ||||||||
TOTAL | 5,269,343.540 shares | |||||||||
Gartmore NVIT Worldwide Leaders Fund | FOR | 2,666,862.487 shares | 94.126% | |||||||
(Formerly Gartmore GVIT Worldwide Leaders Fund) | AGAINST | 47,702.491 shares | 1.684% | |||||||
ABSTAIN | 118,719.882 shares | 4.190% | ||||||||
TOTAL | 2,833,284.860 shares | |||||||||
J.P. Morgan NVIT Balanced Fund | FOR | 15,966,867.546 shares | 90.900% | |||||||
(Formerly J.P. Morgan GVIT Balanced Fund) | AGAINST | 259,004.324 shares | 1.475% | |||||||
ABSTAIN | 1,339,385.200 shares | 7.625% | ||||||||
TOTAL | 17,565,257.070 shares | |||||||||
Van Kampen NVIT Comstock Value Fund | FOR | 27,737,008.009 shares | 92.259% | |||||||
(Formerly Van Kampen GVIT Comstock Value Fund) | AGAINST | 502,564.164 shares | 1.672% | |||||||
ABSTAIN | 1,824,670.107 shares | 6.069% | ||||||||
TOTAL | 30,064,242.280 shares |
Number of Shares | ||||||||||
Fund | Cast/Not Cast | Percentages | ||||||||
Van Kampen NVIT Multi Sector Bond Fund | FOR | 21,253,297.665 shares | 90.281% | |||||||
(Formerly Van Kampen GVIT Multi Sector Bond Fund) | AGAINST | 484,100.920 shares | 2.056% | |||||||
ABSTAIN | 1,803,963.645 shares | 7.663% | ||||||||
TOTAL | 23,541,362.230 shares | |||||||||
At the April 25 Meeting, shareholders of the Nationwide NVIT Mid Cap Growth Fund were also asked to approve a new investment subadvisory agreement among the Adviser, the Trust and NorthPointe Capital LLC. The voting results with respect to that proposal are set forth below:
Proposal 2
Number of Shares | ||||||||||
Fund | Cast/Not Cast | Percentages | ||||||||
Nationwide NVIT Mid Cap Growth Fund | FOR | 10,862,827.499 shares | 90.903% | |||||||
(Formerly Gartmore GVIT Mid Cap Growth Fund) | AGAINST | 414,574.660 shares | 3.469% | |||||||
ABSTAIN | 672,570.741 shares | 5.628% | ||||||||
TOTAL | 11,949,972.900 shares | |||||||||
* | This meeting was previously adjourned on April 23, 2007. | |
** | Fund names were changed effective May 1, 2007 to reflect “Nationwide”/“NVIT” branding to coincide with the sale of Nationwide Fund Advisors, Inc. by Nationwide Corporation to its majority-owned subsidiary, Nationwide Financial Services, Inc. |
June 30, 2007 (Unaudited)
Contents | ||
6 | Statement of Investments | |
30 | Statement of Assets and Liabilities | |
32 | Statement of Operations | |
33 | Statements of Changes in Net Assets | |
35 | Financial Highlights | |
36 | Notes to Financial Statements |
Statement Regarding Availability of Proxy Voting Record.
SAR-INTX (8/07) | ![]() |
Dear Fellow Shareholder:
Since I last wrote to you, our mutual funds have enjoyed another period of solid performance, and the corporate realignment that was in progress is now finished.
On May 1, 2007, Nationwide Financial Services, Inc. (NFS), completed its acquisition of the Philadelphia-based retail mutual fund operations of NWD Investment Management, Inc. (formerly, “Gartmore Global Investments, Inc.”), from Nationwide Corporation, a subsidiary of Nationwide Mutual Insurance Company. Effective that date, the acquired entities were renamed Nationwide Funds Group (NFG), and the Gartmore Funds were renamed the Nationwide Funds to better align with the Nationwide® brand. Although the corporate ownership and fund names have changed, I can assure you that NFG intends to maintain as much continuity as possible with the Funds and key personnel.
Thank you, shareholders, for approving the new investment advisory agreement that was required due to the change in corporate ownership. The new agreement is identical in all material respects to the original agreement that it replaces, with the exception of the section pertaining to the vote by the shareholders of the NVIT Mid Cap Growth Fund to approve NorthPointe Capital®, LLC (NorthPointe) as sub-adviser to that particular Fund.
Market Overview: January 1-June 30, 2007
Share prices in general were buoyed in part by better-than-expected first-quarter 2007 earnings and a flurry of mergers and acquisitions, many of these spurred by readily available funding from private equity firms. In June, investors grew more cautious amid surging crude oil prices, a sudden spike in long-term interest rates, and the meltdown of two hedge funds that had exposure to the subprime mortgage market. Looking abroad, a weak U.S. dollar aided foreign stocks, as reflected in the 11.09% advance of the Morgan Stanley Capital International Europe, Australasia and Far East (MSCI EAFE®) Index. Emerging market performance was particularly robust.
The bond market struggled during the first half of 2007. While short-term interest rates remained stable, reflecting the Federal Reserve Board’s decision in June to leave the target federal funds rate at 5.25%, longer-term rates climbed during the first half of 2007, depressing bond prices and forcing the Lehman Brothers® U.S. Aggregate Index to settle for a modest 0.97% return.
We at NFG thank you for your understanding and cooperation throughout our recent transition period. We emerge from this period energized for the future, and we look forward to serving your investment needs for a long time to come.
Market index performance is provided by a third-party source Nationwide Funds Group deems to be reliable. Indexes are unmanaged and have been provided for illustrative purposes only. No fees or expenses are reflected. Individuals cannot invest directly in an index.
PAST PERFORMANCE IS NO GUARANTEE OF FUTURE RESULTS
Nationwide Funds are advised by Nationwide Fund Advisors (NFA). NFA is a wholly-owned subsidiary of Nationwide Financial Services. Nationwide Financial Services is a wholly-owned subsidiary of Nationwide Corporation. All of the common stock of Nationwide Corporation is held by Nationwide Mutual (95.2%) and Nationwide Mutual Fire Insurance Company (4.8%), each of which is a mutual company owned by its policyholders.
Nationwide Funds Group (NFG) is the mutual fund arm of Nationwide Financial Services (NYSE: NFS). Based in Conshohocken Pa., a suburb of Philadelphia, NFG is comprised of Nationwide Fund Advisors, Nationwide Fund Distributors, LLC, and Nationwide Fund Management, LLC. Together, these provide advisory, distribution, and administration services respectively to the Nationwide Funds, and manage more than $43.5 billion in assets as of June 30, 2007, of which more than $12 billion are in “fund of funds” designed to provide asset allocation across several types of investments and asset classes.
Lehman Brothers (LB) U.S. Aggregate Index: An unmanaged, market value-weighted index of investment-grade, fixed-rate debt issues (including government, corporate, asset-backed, and mortgage-backed securities with maturities of one year or more) that is generally representative of the bond market as a whole.
Morgan Stanley Capital International Europe, Australasia and Far East (MSCI EAFE®) Index: An unmanaged, free float-adjusted, market capitalization-weighted index that is designed to measure the performance of stocks in developed markets outside the United States and Canada.
Standard & Poor’s 500® (S&P 500) Index: An unmanaged, market capitalization-weighted index of 500 widely held stocks of large-cap U.S. companies that gives a broad look at how the stock prices of those companies have performed.
Views expressed within are those of Nationwide Funds Group as of the date noted, are subject to change at any time, and may not come to pass.
This report is for informational purposes only, and is not intended as an offer or recommendation with respect to the purchase or sale of any security, option, future, or other derivatives in such securities.
Investing in mutual funds involves risk, including possible loss of principal.
Investors should carefully consider a fund’s investment objectives, risks, fees, charges, and expenses before investing any money. To obtain this and other fund information, please call 800-848-0920 to request a prospectus, or download a prospectus at www.nationwidefunds.com. Please read the prospectus carefully before investing any money.
Nationwide Funds distributed by Nationwide Fund Distributors LLC (formerly Gartmore Distribution Services, Inc.), Member NASD. 1200 River Road, Suite 1000, Conshohocken, Pa. 19428.
As a shareholder of the Fund, you incur two types of costs: (1) transaction costs, including sales charges (loads) paid on purchase payments and redemption fees; and (2) ongoing costs, including investment advisory fees, administration fees, distribution fees and other Fund expenses. The examples below are 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. Per SEC requirements, the examples assume that you had a $1,000 investment in the Class at the beginning of the reporting period, January 1, 2007, and continued to hold your shares at the end of the reporting period, June 30, 2007.
Actual Expenses
Hypothetical Example for Comparison Purposes
Please note that the expenses shown in the table are meant to highlight your ongoing costs only and do not reflect any transaction costs, such as sales charges (loads) or redemption fees. Therefore, the second line for each Class in 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 transaction costs were included, your costs would have been higher. The examples also assume all dividends and distributions have been reinvested.
Schedule of Shareholder Expenses
Beginning | Ending | |||||||||||||||||||||
Account Value | Account Value | Expenses Paid | Annualized | |||||||||||||||||||
NVIT International Index Fund | 1/1/07 | 06/30/07 | During Period* | Expense Ratio * | ||||||||||||||||||
Class II | Actual | $ | 1,000.00 | $ | 1,100.50 | $ | 3.96 | 0.76% | ||||||||||||||
Hypothetical | 1 | $ | 1,000.00 | $ | 1,021.03 | $ | 3.82 | 0.76% | ||||||||||||||
Class VI | Actual | $ | 1,000.00 | $ | 1,102.30 | $ | 3.96 | 0.76% | ||||||||||||||
Hypothetical | 1 | $ | 1,000.00 | $ | 1,021.03 | $ | 3.82 | 0.76% | ||||||||||||||
Class VII | Actual | $ | 1,000.00 | $ | 1,102.20 | $ | 3.91 | 0.75% | ||||||||||||||
Hypothetical | 1 | $ | 1,000.00 | $ | 1,021.08 | $ | 3.77 | 0.75% | ||||||||||||||
Class VIII | Actual | $ | 1,000.00 | $ | 1,101.60 | $ | 4.27 | 0.82% | ||||||||||||||
Hypothetical | 1 | $ | 1,000.00 | $ | 1,020.73 | $ | 4.12 | 0.82% | ||||||||||||||
Class ID | Actual | $ | 1,000.00 | $ | 1,103.40 | $ | 1.93 | 0.37% | ||||||||||||||
Hypothetical | 1 | $ | 1,000.00 | $ | 1,022.97 | $ | 1.86 | 0.37% |
* | Expenses are equal to the Fund’s annualized expense ratio multiplied by the average account value over the period multiplied by 181/365 (to reflect the one-half year period). The expense ratio presented represents a six-month, annualized ratio in accordance with SEC guidelines. The expenses reported above do not include the effect of additional expenses imposed by variable annuity contracts. | |
1 | Represents the hypothetical 5% return before expenses. |
Asset Allocation | ||||
Common Stock | 95.8% | |||
Repurchase Agreements | 1.6% | |||
Exchange Traded Funds | 1.6% | |||
Rights | 0.0% | |||
Warrants | 0.0% | |||
Other assets in excess of liabilities | 1.0% | |||
100.0% |
Top Holdings* | ||||
iShares MSCI EAFE Index Fund | 1.6% | |||
BP PLC | 1.6% | |||
HSBC Holdings PLC | 1.4% | |||
Vodafone Group PLC | 1.2% | |||
Total SA | 1.2% | |||
Toyota Motor Corp. | 1.1% | |||
Nestle SA | 1.1% | |||
GlaxoSmithKline PLC | 1.0% | |||
Royal Dutch Shell PLC | 1.0% | |||
Novartis AG | 0.9% | |||
Other | 87.9% | |||
100.0% |
Top Industries | ||||
Commercial Banks | 14.8% | |||
Oil, Gas & Consumable Fuels | 7.0% | |||
Pharmaceuticals | 5.3% | |||
Metals & Mining | 4.8% | |||
Insurance | 4.8% | |||
Capital Markets | 4.6% | |||
Diversified Telecommunication Services | 3.6% | |||
Automobiles | 3.2% | |||
Electric Utilities | 3.0% | |||
Chemicals | 2.9% | |||
Other | 46.0% | |||
100.0% |
Top Countries | ||||
United Kingdom | 21.9% | |||
Japan | 20.3% | |||
France | 9.3% | |||
Germany | 8.0% | |||
Switzerland | 6.4% | |||
Australia | 5.9% | |||
Netherlands | 4.0% | |||
Spain | 3.8% | |||
Italy | 3.7% | |||
United States | 3.2% | |||
Other | 13.5% | |||
100.0% |
* | For purpose of listing top holdings, repurchase agreements are included as part of Other. |
NVIT International Index Fund
Common Stocks (95.8%) | ||||||||
Shares or | ||||||||
Principal Amount | Value | |||||||
AUSTRALIA (5.9%) | ||||||||
Airline (0.1%) (a) | ||||||||
Qantas Airways Ltd. | 6,545 | $ | 31,046 | |||||
Beverages (0.1%) (a) | ||||||||
Coca-Cola Amatil Ltd. | 2,629 | 21,221 | ||||||
Foster’s Group Ltd. | 11,770 | 63,500 | ||||||
Lion Nathan Ltd. | 302 | 2,369 | ||||||
87,090 | ||||||||
Biotechnology (0.1%) (a) | ||||||||
CSL Ltd. | 867 | 64,522 | ||||||
Capital Markets (0.1%) (a) | ||||||||
Macquarie Bank Ltd. | 1,391 | 99,885 | ||||||
Perpetual Ltd. | 68 | 4,519 | ||||||
104,404 | ||||||||
Chemicals (0.1%) (a) | ||||||||
Orica Ltd. | 1,632 | 41,113 | ||||||
Commercial Banks (1.4%) (a) | ||||||||
Australia & New Zealand Banking Group Ltd. | 9,612 | 236,026 | ||||||
Commonwealth Bank of Australia | 6,281 | 293,772 | ||||||
National Australia Bank Ltd. | 7,904 | 274,619 | ||||||
Westpac Banking Corp. | 9,692 | 210,410 | ||||||
1,014,827 | ||||||||
Commercial Services & Supplies (0.1%) (a) | ||||||||
Brambles Ltd.* | 5,020 | 51,741 | ||||||
Downer EDI Ltd. | 499 | 3,109 | ||||||
54,850 | ||||||||
Construction & Engineering (0.0%) (a) | ||||||||
Leighton Holdings Ltd. | 686 | 23,906 | ||||||
Construction Materials (0.1%) (a) | ||||||||
Boral Ltd. | 1,823 | 13,529 | ||||||
James Hardie Industries NV | 2,310 | 17,042 | ||||||
Rinker Group Ltd. | 4,356 | 69,399 | ||||||
99,970 | ||||||||
Containers & Packaging (0.0%) (a) | ||||||||
AmCor Ltd. | 3,079 | 19,493 | ||||||
Distributor (0.0%) (a) | ||||||||
Pacific Brands Ltd. | 3,277 | 9,567 | ||||||
Diversified Consumer Services (0.0%) (a) | ||||||||
ABC Learning Centres Ltd. | 3,039 | 17,778 | ||||||
Diversified Financial Services (0.2%) (a) | ||||||||
Australian Stock Exchange Ltd. | 774 | 31,867 | ||||||
Challenger Financial Services Group Ltd. | 2,902 | 14,293 | ||||||
SunCorp-Metway Ltd. | 5,027 | 85,837 | ||||||
131,997 | ||||||||
Diversified Telecommunication Services (0.1%) (a) | ||||||||
Telstra Corp. Ltd. | 15,756 | 61,286 | ||||||
Telstra Corp. Ltd. | 4,399 | 11,570 | ||||||
72,856 | ||||||||
Energy Equipment & Services (0.1%) (a) | ||||||||
Babcock & Brown Ltd. | 998 | 27,048 | ||||||
WorleyParsons Ltd. | 464 | 13,344 | ||||||
40,392 | ||||||||
Food & Staples Retailing (0.3%) (a) | ||||||||
Coles Myer Ltd. | 6,319 | 86,255 | ||||||
Woolworths Ltd. | 5,663 | 129,386 | ||||||
215,641 | ||||||||
Food Products (0.0%) (a) | ||||||||
Goodman Fielder Ltd. | 7,241 | 14,898 | ||||||
Health Care Equipment & Supplies (0.0%) (a) | ||||||||
Ansell Ltd. | 5 | 51 | ||||||
Cochlear Ltd. | 136 | 7,021 | ||||||
7,072 | ||||||||
Health Care Providers & Services (0.1%) (a) | ||||||||
Sonic Health Care Products & Services Ltd. | 2,127 | 27,103 | ||||||
Symbion Health Ltd. | 5,358 | 18,514 | ||||||
45,617 | ||||||||
Hotels, Restaurants & Leisure (0.1%) (a) | ||||||||
Aristocrat Leisure Ltd. | 1,816 | 22,076 | ||||||
Tabcorp Holdings Ltd. | 2,405 | 34,936 | ||||||
Tattersall’s Ltd. | 5,381 | 21,396 | ||||||
78,408 | ||||||||
Industrial Conglomerates (0.1%) (a) | ||||||||
CSR Ltd. | 7,353 | 21,636 | ||||||
Wesfarmers Ltd. | 1,656 | 64,106 | ||||||
85,742 | ||||||||
Insurance (0.4%) (a) | ||||||||
AMP Ltd. | 8,724 | 74,676 | ||||||
AXA Asia Pacific Holdings Ltd. | 3,052 | 19,185 | ||||||
Insurance Australia Group Ltd. | 8,501 | 40,995 | ||||||
BE Insurance Group Ltd. | 4,503 | 118,784 | ||||||
253,640 | ||||||||
Common Stocks (continued) | ||||||||
Shares or | ||||||||
Principal Amount | Value | |||||||
AUSTRALIA (continued) | ||||||||
IT Services (0.0%) (a) | ||||||||
Computershare Ltd. | 1,934 | $ | 18,449 | |||||
Media (0.1%) (a) | ||||||||
John Fairfax Holdings Ltd. | 8,198 | 32,607 | ||||||
Macquarie Communications Infrastructure Group | 1,976 | 10,572 | ||||||
Publishing & Broadcasting Ltd. | 2,786 | 46,158 | ||||||
89,337 | ||||||||
Metals & Mining (1.1%) (a) | ||||||||
Alumina Ltd. | 6,062 | 40,138 | ||||||
BHP Billiton Ltd. | 17,233 | 514,813 | ||||||
BlueScope Steel Ltd. | 3,107 | 27,187 | ||||||
Fortescue Metals Group Ltd.* | 795 | 22,706 | ||||||
Iluka Resources Ltd. | 790 | 4,117 | ||||||
Newcrest Metals & Mining Ltd. | 1,598 | 30,834 | ||||||
OneSteel Ltd. | 2,549 | 13,862 | ||||||
Rio Tinto Ltd. | 1,541 | 128,516 | ||||||
Zinifex Ltd. | 2,815 | 44,631 | ||||||
826,804 | ||||||||
Multi-Utilities (0.1%) (a) | ||||||||
AGL Energy Ltd. | 1,497 | 19,232 | ||||||
Alinta Ltd. | 3,161 | 40,759 | ||||||
59,991 | ||||||||
Multiline Retail (0.0%) (a) | ||||||||
Harvey Norman Holdings Ltd. | 942 | 4,213 | ||||||
Oil, Gas & Consumable Fuels (0.3%) (a) | ||||||||
Caltex Australia Ltd. | 657 | 13,153 | ||||||
Origin Energy Ltd. | 3,239 | 27,229 | ||||||
Paladin Resources Ltd.* | 2,908 | 20,202 | ||||||
Santos Ltd. | 3,750 | 44,268 | ||||||
Woodside Petroleum Ltd. | 2,575 | 99,520 | ||||||
204,372 | ||||||||
Paper & Forest Products (0.0%) (a) | ||||||||
PaperlinX Ltd. | 342 | 1,076 | ||||||
Real Estate Investment Trusts (REITs) (0.6%) (a) | ||||||||
Centro Properties Group | 5,423 | 38,987 | ||||||
CFS Retail Property Trust | 2,242 | 4,072 | ||||||
Commonwealth Property Office Fund | 1,046 | 1,484 | ||||||
DB RREEF Trust | 8,913 | 14,793 | ||||||
GPT Group | 10,194 | 40,172 | ||||||
ING Industrial Fund | 5,840 | 11,562 | ||||||
Investa Property Group | 11,116 | 27,437 | ||||||
Macquarie Goodman Group | 5,865 | 33,278 | ||||||
Macquarie Office Trust | 3,586 | 5,070 | ||||||
Mirvac Group | 6,870 | 33,130 | ||||||
Multiplex Group | 4,532 | 18,862 | ||||||
Stockland | 8,422 | 58,006 | ||||||
Westfield Group | 8,564 | 144,468 | ||||||
431,321 | ||||||||
Real Estate Management & Development (0.0%) (a) | ||||||||
Lend Lease Corp. Ltd. | 1,256 | 19,711 | ||||||
Road & Rail (0.1%) | ||||||||
Asciano Group* | 3,375 | 28,978 | ||||||
Toll Holdings Ltd.(a) | 3,353 | 41,079 | ||||||
70,057 | ||||||||
Textiles, Apparel & Luxury Goods (0.0%) (a) | ||||||||
Billabong International Ltd. | 240 | 3,643 | ||||||
Transportation Infrastructure (0.1%) (a) | ||||||||
Macquarie Airports | 3,560 | 12,162 | ||||||
Macquarie Infrastructure Group | 10,691 | 32,556 | ||||||
Transurban Group | 4,122 | 27,941 | ||||||
72,659 | ||||||||
4,316,462 | ||||||||
AUSTRIA (0.6%) (a) | ||||||||
Building Products (0.0%) | ||||||||
Wienerberger AG | 419 | 30,806 | ||||||
Commercial Banks (0.1%) | ||||||||
Erste Bank der Oesterreichischen Sparkassen AG | 1,057 | 82,375 | ||||||
Raiffeisen International Bank Holding AG | 139 | 21,952 | ||||||
104,327 | ||||||||
Construction Materials (0.0%) | ||||||||
RHI AG* | 247 | 13,481 | ||||||
Diversified Telecommunication Services (0.1%) | ||||||||
Telekom Austria AG | 1,730 | 43,077 | ||||||
Electric Utility (0.0%) | ||||||||
Verbund-Oesterreichische Elektrizitaetswirtschafts AG | 226 | 11,555 | ||||||
Hotels, Restaurants & Leisure (0.0%) | ||||||||
BetandWin.com Interactive Entertainment AG* | 174 | 5,732 | ||||||
Insurance (0.0%) | ||||||||
Wiener Staedtische Versicherung AG | 42 | 2,993 | ||||||
Machinery (0.0%) | ||||||||
Andritz AG | 216 | 14,224 | ||||||
NVIT International Index Fund (Continued)
Common Stocks (continued) | ||||||||
Shares or | ||||||||
Principal Amount | Value | |||||||
AUSTRIA (continued) | ||||||||
Metals & Mining (0.1%) | ||||||||
Boehler-Uddeholm AG | 260 | $ | 25,959 | |||||
Voestalpine AG | 592 | 49,758 | ||||||
75,717 | ||||||||
Oil, Gas & Consumable Fuels (0.1%) | ||||||||
OMV AG | 848 | 56,560 | ||||||
Real Estate Management & Development (0.2%) | ||||||||
Immoeast Immobilien Anlagen* | 1,524 | 21,504 | ||||||
IMMOFINANZ Immobilien Anlagen AG* | 2,474 | 36,026 | ||||||
Meinl European Land Ltd.* | 1,776 | 50,900 | ||||||
108,430 | ||||||||
466,902 | ||||||||
BELGIUM (1.2%) (a) | ||||||||
Beverages (0.1%) | ||||||||
InBev NV | 943 | 74,683 | ||||||
Chemicals (0.1%) | ||||||||
Solvay SA | 270 | 42,497 | ||||||
Umicore | 167 | 36,205 | ||||||
78,702 | ||||||||
Commercial Banks (0.3%) | ||||||||
Dexia | 2,423 | 75,677 | ||||||
KBC Groep NV | 998 | 134,484 | ||||||
210,161 | ||||||||
Diversified Financial Services (0.4%) | ||||||||
Fortis | 6,157 | 260,929 | ||||||
Groupe Bruxelles Lambert SA | 487 | 60,527 | ||||||
321,456 | ||||||||
Diversified Telecommunication Services (0.1%) | ||||||||
Belgacom SA | 1,029 | 45,537 | ||||||
Electrical Equipment (0.0%) | ||||||||
Bekaert SA | 6 | 880 | ||||||
Electronic Equipment & Instruments (0.0%) | ||||||||
BarCo NV | 28 | 2,599 | ||||||
Food & Staples Retailing (0.1%) | ||||||||
Colruyt SA | 46 | 9,600 | ||||||
Delhaize Group | 458 | 44,981 | ||||||
54,581 | ||||||||
Health Care Equipment & Supplies (0.0%) | ||||||||
Omega Pharma SA | 26 | 2,251 | ||||||
Leisure Equipment & Products (0.0%) | ||||||||
AGFA-Gevaert NV | 979 | 25,251 | ||||||
Pharmaceutical (0.1%) | ||||||||
UCB SA | 677 | 40,037 | ||||||
Transportation (0.0%) | ||||||||
Compagnie Maritime Belge SA | 62 | 4,327 | ||||||
Wireless Telecommunication Services (0.0%) | ||||||||
Mobistar SA | 136 | 11,584 | ||||||
872,049 | ||||||||
BERMUDA (0.0%) (a) | ||||||||
Oil, Gas & Consumable Fuels (0.0%) | ||||||||
Frontline Ltd. | 350 | 16,095 | ||||||
CAYMAN ISLANDS (0.1%) (a) | ||||||||
Communications Equipment (0.1%) | ||||||||
FoxConn International Holdings Ltd.* | 8,730 | 25,013 | ||||||
Wireless Telecommunication Services (0.0%) | ||||||||
Hutchison Telecommunications International Ltd. | 6,000 | 7,728 | ||||||
32,741 | ||||||||
DENMARK (0.8%) (a) | ||||||||
Beverages (0.0%) | ||||||||
Carlsberg | 150 | 18,134 | ||||||
Chemicals (0.0%) | ||||||||
Novozymes | 200 | 23,184 | ||||||
Commercial Banks (0.2%) | ||||||||
Danske Bank | 2,600 | 106,335 | ||||||
Jyske Bank* | 200 | 14,414 | ||||||
Sydbank | 147 | 7,030 | ||||||
127,779 | ||||||||
Construction & Engineering (0.0%) | ||||||||
FLSmidth & Co. | 200 | 15,664 | ||||||
Food Products (0.1%) | ||||||||
Danisco AS | 400 | 29,827 | ||||||
East Asiatic Co. Ltd. | 225 | 12,376 | ||||||
42,203 | ||||||||
Health Care Equipment & Supplies (0.1%) | ||||||||
Coloplast | 150 | 12,154 | ||||||
GN Store Nord* | 1,600 | 18,888 | ||||||
William Demant Holding* | 50 | 4,953 | ||||||
35,995 | ||||||||
Household Durables (0.0%) | ||||||||
Bang & Olufsen | 60 | 7,176 | ||||||
Common Stocks (continued) | ||||||||
Shares or | ||||||||
Principal Amount | Value | |||||||
DENMARK (continued) | ||||||||
Insurance (0.0%) | ||||||||
Topdanmark* | 50 | $ | 8,527 | |||||
TrygVesta AS | 153 | 12,024 | ||||||
20,551 | ||||||||
Machinery (0.0%) | ||||||||
NKT Holding AS | 100 | 9,928 | ||||||
Marine (0.1%) | ||||||||
AP Moller — Maersk AS | 5 | 60,149 | ||||||
Oil, Gas & Consumable Fuels (0.1%) | ||||||||
Vestas Wind Systems* | 1,000 | 65,632 | ||||||
Pharmaceuticals (0.2%) | ||||||||
H. Lunbeck AS | 400 | 10,136 | ||||||
Novo-Nordisk | 1,150 | 125,109 | ||||||
135,245 | ||||||||
Road & Rail (0.0%) | ||||||||
DSV A/ S | 1,455 | 28,503 | ||||||
590,143 | ||||||||
FINLAND (1.6%) (a) | ||||||||
Auto Components (0.0%) | ||||||||
Nokian Renkaat OYJ | 650 | 22,769 | ||||||
Building Products (0.0%) | ||||||||
Uponor OYJ | 100 | 3,887 | ||||||
Communications Equipment (0.8%) | ||||||||
Nokia OYJ | 20,150 | 565,857 | ||||||
Construction & Engineering (0.0%) | ||||||||
YIT OYJ | 653 | 20,491 | ||||||
Diversified Financial Services (0.0%) | ||||||||
OKO Bank PLC | 48 | 889 | ||||||
Diversified Telecommunication Services (0.0%) | ||||||||
Elisa OYJ, Class A | 1,100 | 29,982 | ||||||
Electric Utility (0.1%) | ||||||||
Fortum OYJ | 2,200 | 68,737 | ||||||
Food & Staples Retailing (0.0%) | ||||||||
Kesko OYJ | 400 | 26,535 | ||||||
Insurance (0.1%) | ||||||||
Sampo OYJ | 2,500 | 71,975 | ||||||
IT Services (0.0%) | ||||||||
Tietoenator OYJ | 580 | 18,634 | ||||||
Leisure Equipment & Products (0.0%) | ||||||||
Amer Sports OYJ | 400 | 9,872 | ||||||
Machinery (0.2%) | ||||||||
Cargotec Corp. | 80 | 4,919 | ||||||
KCI Konecranes OYJ | 480 | 20,057 | ||||||
Kone OYJ | 340 | 21,369 | ||||||
Metso OYJ | 800 | 47,076 | ||||||
Wartsila OYJ | 200 | 13,151 | ||||||
106,572 | ||||||||
Media (0.0%) | ||||||||
Sanoma-WSOY OYJ | 140 | 4,424 | ||||||
Metals & Mining (0.1%) | ||||||||
Outokumpu OYJ | 800 | 26,904 | ||||||
Rautaruukki OYJ | 350 | 22,356 | ||||||
49,260 | ||||||||
Oil, Gas & Consumable Fuels (0.1%) | ||||||||
Neste Oil OYJ | 850 | 33,305 | ||||||
Paper & Forest Products (0.2%) | ||||||||
Stora Enso OYJ | 3,400 | 63,965 | ||||||
UPM-Kymmene OYJ | 3,000 | 73,823 | ||||||
137,788 | ||||||||
Pharmaceutical (0.0%) | ||||||||
Orion OYJ | 207 | 5,180 | ||||||
1,176,157 | ||||||||
FRANCE (9.3%) | ||||||||
Aerospace & Defense (0.1%) (a) | ||||||||
Safran SA | 524 | 13,399 | ||||||
Thales SA | 368 | 22,485 | ||||||
Zodiac SA | 196 | 15,056 | ||||||
50,940 | ||||||||
Airline (0.1%) (a) | ||||||||
Air France-KLM | 801 | 37,266 | ||||||
Auto Components (0.2%) (a) | ||||||||
Compagnie Generale des Etablissements Michelin | 802 | 112,063 | ||||||
Valeo SA | 502 | 26,932 | ||||||
138,995 | ||||||||
Automobiles (0.3%) (a) | ||||||||
Peugeot SA | 893 | 71,933 | ||||||
Renault SA | 975 | 156,362 | ||||||
228,295 | ||||||||
Beverages (0.2%) (a) | ||||||||
Pernod-Ricard SA | 505 | 111,486 | ||||||
NVIT International Index Fund (Continued)
Common Stocks (continued) | ||||||||
Shares or | ||||||||
Principal Amount | Value | |||||||
FRANCE (continued) | ||||||||
Building Products (0.3%) (a) | ||||||||
Compagnie de Saint-Gobain | 1,668 | $ | 186,834 | |||||
Chemicals (0.2%) (a) | ||||||||
AIir Liquide SA | 1,275 | 167,291 | ||||||
Commercial Banks (1.3%) (a) | ||||||||
BNP Paribas | 4,097 | 486,604 | ||||||
Credit Agricole SA | 3,261 | 132,310 | ||||||
Societe Generale | 1,865 | 345,507 | ||||||
964,421 | ||||||||
Commercial Services & Supplies (0.0%) (a) | ||||||||
Societe BIC SA | 35 | 2,577 | ||||||
Communications Equipment (0.2%) (a) | ||||||||
Alcatel-Lucent | 11,054 | 154,603 | ||||||
Construction & Engineering (0.2%) (a) | ||||||||
Vinci SA | 2,164 | 161,497 | ||||||
Construction Materials (0.2%) (a) | ||||||||
Imerys SA | 76 | 7,693 | ||||||
Lafarge SA | 795 | 144,875 | ||||||
152,568 | ||||||||
Diversified Telecommunication Services (0.3%) (a) | ||||||||
France Telecom SA | 8,198 | 224,818 | ||||||
Electrical Equipment (0.3%) (a) | ||||||||
Alstom RGPT | 497 | 82,867 | ||||||
Schneider Electric SA | 1,175 | 164,610 | ||||||
247,477 | ||||||||
Energy Equipment & Services (0.1%) (a) | ||||||||
Technip SA | 613 | 50,661 | ||||||
Food & Staples Retailing (0.3%) (a) | ||||||||
Carrefour SA | 3,111 | 218,474 | ||||||
Casino Guichard Perrachon SA | 191 | 19,311 | ||||||
237,785 | ||||||||
Food Products (0.3%) (a) | ||||||||
Groupe Danone | 2,308 | 186,388 | ||||||
Gas Utility (0.1%) (a) | ||||||||
Gaz de France | 831 | 41,915 | ||||||
Health Care Equipment & Supplies (0.1%) (a) | ||||||||
Cie Generale d’Optique Essilor Int’l SA | 580 | 69,074 | ||||||
Hotels, Restaurants & Leisure (0.2%) (a) | ||||||||
Accor SA | 1,024 | 90,512 | ||||||
Sodexho Alliance SA | 374 | 26,741 | ||||||
117,253 | ||||||||
Household Durables (0.0%) | ||||||||
Thomson | 1,644 | 31,437 | ||||||
Insurance (0.5%) (a) | ||||||||
Axa | 7,659 | 329,191 | ||||||
CNP Assurances | 162 | 20,698 | ||||||
Scor SA | 391 | 10,613 | ||||||
360,502 | ||||||||
IT Services (0.1%) (a) | ||||||||
Atos Origin SA* | 449 | 28,059 | ||||||
Capgemini SA | 786 | 57,457 | ||||||
85,516 | ||||||||
Machinery (0.1%) (a) | ||||||||
Vallourec SA | 267 | 85,358 | ||||||
Media (0.5%) | ||||||||
Lagardere SA (a) | 725 | 62,872 | ||||||
M6-Metropole Television (a) | 120 | 3,900 | ||||||
PagesJaunes Groupe SA (a) | 320 | 6,735 | ||||||
Publicis Groupe | 910 | 40,209 | ||||||
Societe Television Francaise 1 (a) | 851 | 29,411 | ||||||
Vivendi Universal SA (a) | 5,676 | 244,142 | ||||||
387,269 | ||||||||
Multi-Utilities (0.6%) | ||||||||
Suez SA (a) | 4,905 | 280,381 | ||||||
Veolia Environnement | 1,816 | 142,595 | ||||||
422,976 | ||||||||
Multiline Retail (0.1%) (a) | ||||||||
PPR SA | 366 | 63,836 | ||||||
Office Electronics (0.0%) (a) | ||||||||
Neopost SA | 108 | 15,801 | ||||||
Oil, Gas & Consumable Fuels (1.2%) (a) | ||||||||
Total SA | 10,578 | 857,553 | ||||||
Personal Products (0.2%) (a) | ||||||||
L’Oreal SA | 1,171 | 138,398 | ||||||
Pharmaceutical (0.5%) (a) | ||||||||
Sanofi-Aventis | 4,962 | 400,823 | ||||||
Common Stocks (continued) | ||||||||
Shares or | ||||||||
Principal Amount | Value | |||||||
FRANCE (continued) | ||||||||
Real Estate Investment Trusts (REITs) (0.1%) (a) | ||||||||
Gecina SA | 15 | $ | 2,507 | |||||
Klepierre | 74 | 12,529 | ||||||
Unibail | 269 | 68,785 | ||||||
83,821 | ||||||||
Real Estate Management & Development (0.0%) (a) | ||||||||
Icade | 64 | 4,929 | ||||||
Software (0.1%) (a) | ||||||||
Business Objects SA* | 643 | 25,114 | ||||||
Dassault Systemes SA | 190 | 11,977 | ||||||
37,091 | ||||||||
Textiles, Apparel & Luxury Goods (0.2%) (a) | ||||||||
Hermes Int’l | 284 | 32,102 | ||||||
LVMH Moet Hennessy Louis Vuitton SA | 1,230 | 141,514 | ||||||
173,616 | ||||||||
Transportation Infrastructure (0.0%) (a) | ||||||||
Aeroports De Paris | 126 | 14,620 | ||||||
Societe Des Autoroutes Paris-Rhin-Rhone | 133 | 13,514 | ||||||
28,134 | ||||||||
Wireless Telecommunication Services (0.1%) (a) | ||||||||
Bouygues SA | 1,220 | 102,207 | ||||||
6,811,411 | ||||||||
GERMANY (8.0%) (a) | ||||||||
Air Freight & Logistics (0.2%) | ||||||||
Deutsche Post AG | 4,254 | 137,691 | ||||||
Airline (0.1%) | ||||||||
Deutsche Lufthansa AG | 1,423 | 39,686 | ||||||
Auto Components (0.1%) | ||||||||
Continental AG | 737 | 103,566 | ||||||
Automobiles (0.9%) | ||||||||
Daimler Chrysler AG | 4,586 | 422,112 | ||||||
Porsche AG | 50 | 89,230 | ||||||
Volkswagen AG | 827 | 131,505 | ||||||
Volkswagen AG, Preferred Shares | 467 | 48,214 | ||||||
691,061 | ||||||||
Capital Markets (0.5%) | ||||||||
Deutsche Bank AG | 2,550 | 369,015 | ||||||
MLP AG | 88 | 1,691 | ||||||
370,706 | ||||||||
Chemicals (0.9%) | ||||||||
BASF AG | 2,421 | 316,675 | ||||||
Bayer AG | 3,488 | 262,710 | ||||||
Linde AG | 685 | 82,406 | ||||||
661,791 | ||||||||
Commercial Banks (0.3%) | ||||||||
Commerzbank AG | 3,213 | 153,230 | ||||||
Deutsche Postbank AG | 521 | 45,676 | ||||||
198,906 | ||||||||
Construction & Engineering (0.1%) | ||||||||
Bilfinger Berger AG | 107 | 9,484 | ||||||
Hochtief AG | 283 | 30,814 | ||||||
40,298 | ||||||||
Diversified Financial Services (0.2%) | ||||||||
Deutsche Boerse AG | 1,123 | 126,077 | ||||||
Diversified Telecommunication Services (0.3%) | ||||||||
Deutsche Telekom AG | 13,635 | 251,096 | ||||||
Electric Utility (0.7%) | ||||||||
E. On AG | 3,085 | 515,024 | ||||||
Electronic Equipment & Instruments (0.0%) | ||||||||
Wincor Nixdorf AG | 70 | 6,382 | ||||||
Food & Staples Retailing (0.1%) | ||||||||
Metro AG | 939 | 77,601 | ||||||
Food Products (0.0%) | ||||||||
Suedzucker AG | 51 | 1,131 | ||||||
Health Care Providers & Services (0.1%) | ||||||||
Celesio AG | 304 | 19,761 | ||||||
Fresenius Medical Care AG & Co. | 917 | 42,143 | ||||||
61,904 | ||||||||
Hotels, Restaurants & Leisure (0.1%) | ||||||||
TUI AG* | 1,382 | 38,054 | ||||||
Household Products (0.1%) | ||||||||
Henkel KGaA | 959 | 50,530 | ||||||
Industrial Conglomerates (0.9%) | ||||||||
Rheinmetall AG | 223 | 20,679 | ||||||
Siemens AG | 4,174 | 597,659 | ||||||
618,338 | ||||||||
Insurance (1.0%) | ||||||||
Allianz AG | 2,216 | 516,709 | ||||||
Muenchener Rueckversicherungs AG | 1,123 | 205,926 | ||||||
722,635 | ||||||||
NVIT International Index Fund (Continued)
Common Stocks (continued) | ||||||||
Shares or | ||||||||
Principal Amount | Value | |||||||
GERMANY (continued) | ||||||||
Machinery (0.1%) | ||||||||
Heidelberger Druckmaschinen | 449 | $ | 21,657 | |||||
MAN AG | 552 | 78,795 | ||||||
100,452 | ||||||||
Media (0.0%) | ||||||||
Premiere AG* | 583 | 13,946 | ||||||
ProsiebenSAT.1 Media AG | 265 | 10,405 | ||||||
24,351 | ||||||||
Metals & Mining (0.2%) | ||||||||
Salzgitter AG | 246 | 47,141 | ||||||
Thyssenkrupp AG | 1,739 | 102,908 | ||||||
150,049 | ||||||||
Multi-Utilities (0.4%) | ||||||||
RWE AG | 2,288 | 242,685 | ||||||
RWE AG, Non-Voting Preferred Shares | 116 | 11,514 | ||||||
254,199 | ||||||||
Multiline Retail (0.0%) | ||||||||
KarstadtQuelle AG* | 320 | 10,778 | ||||||
Oil, Gas & Consumable Fuels (0.0%) | ||||||||
Solarworld AG | 432 | 19,882 | ||||||
Personal Products (0.0%) | ||||||||
Beiersdorf AG | 334 | 23,771 | ||||||
Pharmaceuticals (0.1%) | ||||||||
Altana AG | 654 | 15,804 | ||||||
Merck KGAA | 380 | 51,986 | ||||||
67,790 | ||||||||
Real Estate Management & Development (0.0%) | ||||||||
IVG Immobilien AG | 441 | 17,311 | ||||||
Semiconductors & Semiconductor Equipment (0.1%) | ||||||||
Infineon Technologies AG* | 4,207 | 69,529 | ||||||
Software (0.3%) | ||||||||
SAP AG | 4,408 | 225,344 | ||||||
Specialty Retail (0.0%) | ||||||||
Douglas Holding AG | 28 | 1,826 | ||||||
Textiles, Apparel & Luxury Goods (0.1%) | ||||||||
Adidas AG | 1,190 | 75,880 | ||||||
Puma AG Rudolf Dassler Sport | 63 | 28,081 | ||||||
103,961 | ||||||||
Thrifts & Mortgage Finance (0.1%) | ||||||||
Hypo Real Estate Holding AG | 819 | 52,927 | ||||||
5,834,647 | ||||||||
GREECE (0.7%) | ||||||||
Beverages (0.0%) | ||||||||
Coca Cola Hellenic Bottling Co. SA | 365 | 16,795 | ||||||
Commercial Banks (0.4%) (a) | ||||||||
Alpha Bank AE | 2,272 | 71,220 | ||||||
EFG Eurobank Ergasias SA | 1,170 | 38,113 | ||||||
National Bank of Greece SA | 2,235 | 127,246 | ||||||
Piraeus Bank SA | 1,496 | 54,509 | ||||||
291,088 | ||||||||
Construction & Engineering (0.0%) (a) | ||||||||
Hellenic Technodomiki Tev SA | 560 | 7,323 | ||||||
Construction Materials (0.0%) (a) | ||||||||
Titan Cement Co. | 165 | 9,511 | ||||||
Diversified Financial Services (0.0%) (a) | ||||||||
Hellenic Exchanges Holding SA | 478 | 12,473 | ||||||
Diversified Telecommunication Services (0.1%) | ||||||||
Hellenic Telecommunications Organization SA | 1,751 | 54,265 | ||||||
Electric Utility (0.1%) (a) | ||||||||
Public Power Corp. | 666 | 18,768 | ||||||
Hotels, Restaurants & Leisure (0.1%) (a) | ||||||||
OPAP SA | 910 | 32,150 | ||||||
Metals & Mining (0.0%) (a) | ||||||||
Viohal Co. | 106 | 1,641 | ||||||
Oil, Gas & Consumable Fuels (0.0%) (a) | ||||||||
Hellenic Petroleum SA | 122 | 1,962 | ||||||
Motor Oil Hellas Corinth Refineries SA | 187 | 4,899 | ||||||
6,861 | ||||||||
Textiles, Apparel & Luxury Goods (0.0%) (a) | ||||||||
Folli-Follie SA | 58 | 2,347 | ||||||
Wireless Telecommunication Services (0.0%) (a) | ||||||||
Cosmote Mobile Telecommunications SA | 489 | 15,084 | ||||||
468,306 | ||||||||
HONG KONG (1.6%) | ||||||||
Airline (0.0%) (a) | ||||||||
Cathay Pacific Airways Ltd. | 4,000 | 9,948 | ||||||
Commercial Banks (0.2%) (a) | ||||||||
Bank of East Asia Ltd. | 9,000 | 50,616 | ||||||
BOC Hong Kong Holdings Ltd. | 23,000 | 54,762 | ||||||
Hang Seng Bank Ltd. | 3,400 | 46,009 |
Common Stocks (continued) | ||||||||
Shares or | ||||||||
Principal Amount | Value | |||||||
HONG KONG (continued) | ||||||||
Commercial Banks (continued) | ||||||||
Hkd Wing Hang Bank Ltd. | 500 | $ | 5,521 | |||||
156,908 | ||||||||
Communications Equipment (0.0%) (a) | ||||||||
Tencent Holdings Ltd. | 3,725 | 14,975 | ||||||
Distributor (0.1%) (a) | ||||||||
Li & Fung Ltd. | 14,800 | 53,274 | ||||||
Diversified Financial Services (0.1%) (a) | ||||||||
Hong Kong Exchanges & Clearing Ltd. | 6,000 | 84,705 | ||||||
Diversified Telecommunication Services (0.0%) (a) | ||||||||
PCCW Ltd. | 28,000 | 17,238 | ||||||
Electric Utilities (0.1%) (a) | ||||||||
Cheung Kong Infrastructure Holdings Ltd. | 1,000 | 3,690 | ||||||
CLP Holdings Ltd. | 8,000 | 53,704 | ||||||
Hong Kong Electric Holdings | 5,500 | 27,745 | ||||||
85,139 | ||||||||
Electrical Equipment (0.0%) (a) | ||||||||
Johnson Electric Holdings Ltd. | 8,000 | 4,443 | ||||||
Electronic Equipment & Instruments (0.0%) (a) | ||||||||
Kingboard Chemical Holdings Ltd. | 1,500 | 6,904 | ||||||
Food Products (0.0%) (a) | ||||||||
Tingyi (Cayman Islands) Holdings Co. | 4,000 | 4,654 | ||||||
Gas Utility (0.1%) (a) | ||||||||
Hong Kong & China Gas | 20,800 | 43,832 | ||||||
Hotels, Restaurants & Leisure (0.0%) | ||||||||
ShanGri-La Asia Ltd. | 4,000 | 9,669 | ||||||
Household Durables (0.0%) (a) | ||||||||
Techtronic Industries Co. | 8,500 | 11,350 | ||||||
Industrial Conglomerates (0.2%) (a) | ||||||||
Hutchison Whampoa Ltd. | 12,000 | 119,129 | ||||||
MelCo International Development | 8,000 | 11,895 | ||||||
131,024 | ||||||||
Marine (0.0%) (a) | ||||||||
Orient Overseas International Ltd. | 1,000 | 9,777 | ||||||
Real Estate Investment Trust (REIT) (0.1%) (a) | ||||||||
Link REIT (The) | 10,500 | 23,242 | ||||||
Real Estate Management & Development (0.6%) (a) | ||||||||
Cheung Kong Holdings Ltd. | 8,000 | 104,833 | ||||||
Hang Lung Properties Ltd. | 13,000 | 44,890 | ||||||
Henderson Land Development Co. | 5,000 | 34,086 | ||||||
Hopewell Holdings Ltd. | 1,000 | 4,081 | ||||||
Hysan Development Co. Ltd. | 1,000 | 2,663 | ||||||
Kerry Properties Ltd. | 1,500 | 9,421 | ||||||
New World Development Co. Ltd. | 10,000 | 25,027 | ||||||
Shui on Land Ltd. | 15,000 | 13,459 | ||||||
Shun Tak Holdings Ltd. | 2,000 | 2,944 | ||||||
Sino Land Co. | 8,000 | 16,656 | ||||||
Sun Hung Kai Properties Ltd. | 8,000 | 96,265 | ||||||
Swire Pacific Ltd. | 4,000 | 44,524 | ||||||
Wharf Holdings Ltd. | 4,000 | 15,976 | ||||||
414,825 | ||||||||
Road & Rail (0.0%) (a) | ||||||||
MTR Corp. | 6,500 | 15,401 | ||||||
Specialty Retail (0.1%) | ||||||||
Belle International Holdings Ltd.* | 17,000 | 18,763 | ||||||
Esprit Holdings Ltd.(a) | 4,500 | 57,177 | ||||||
Giordano International Ltd.(a) | 26,000 | 12,820 | ||||||
88,760 | ||||||||
Textiles, Apparel & Luxury Goods (0.0%) (a) | ||||||||
Yue Yuen Industrial Holdings | 1,500 | 4,650 | ||||||
1,190,718 | ||||||||
IRELAND (0.8%) | ||||||||
Airline (0.0%) (a) | ||||||||
Ryanair Holdings PLC* | 1,986 | 13,248 | ||||||
Beverages (0.1%) (a) | ||||||||
C&C Group PLC | 2,125 | 28,603 | ||||||
Building Products (0.0%) (a) | ||||||||
Kingspan Group PLC | 419 | 11,751 | ||||||
Commercial Banks (0.3%) | ||||||||
Allied Irish Banking PLC (a) | 4,650 | 127,010 | ||||||
Bank of Ireland | 4,663 | 93,935 | ||||||
Depfa Bank PLC (a) | 1,407 | 24,780 | ||||||
245,725 | ||||||||
Construction Materials (0.2%) (a) | ||||||||
CRH PLC | 2,969 | 146,710 | ||||||
Food Products (0.0%) (a) | ||||||||
GreenCore Group PLC | 1,424 | 10,777 | ||||||
Iaws Group PLC | 265 | 5,556 | ||||||
Kerry Group PLC | 395 | 11,054 | ||||||
27,387 | ||||||||
NVIT International Index Fund (Continued)
Common Stocks (continued) | ||||||||
Shares or | ||||||||
Principal Amount | Value | |||||||
IRELAND (continued) | ||||||||
Gaming (0.0%) (a) | ||||||||
Paddy Power PLC | 13 | $ | 405 | |||||
Industrial Conglomerate (0.0%) (a) | ||||||||
DCC PLC | 144 | 4,858 | ||||||
Insurance (0.1%) (a) | ||||||||
Irish Life & Permanent PLC | 1,415 | 35,718 | ||||||
Media (0.0%) (a) | ||||||||
Independent News & Media PLC | 3,172 | 16,076 | ||||||
Pharmaceutical (0.1%) (a) | ||||||||
Elan Corp. PLC* | 2,131 | 46,380 | ||||||
Trading Companies & Distributors (0.0%) (a) | ||||||||
Grafton Group PLC* | 1,479 | 21,104 | ||||||
597,965 | ||||||||
ITALY (3.7%) | ||||||||
Aerospace & Defense (0.1%) (a) | ||||||||
Finmeccanica SpA | 1,805 | 55,450 | ||||||
Automobiles (0.2%) (a) | ||||||||
Fiat SpA | 3,704 | 110,008 | ||||||
Capital Markets (0.1%) (a) | ||||||||
Mediobanca SpA | 2,523 | 57,303 | ||||||
Commercial Banks (1.3%) (a) | ||||||||
Banca Monte dei Paschi di Siena SpA | 6,959 | 47,060 | ||||||
Banca Popolare di Milano Scarl | 2,734 | 41,694 | ||||||
Banche Popolari Unite Scpa | 3,435 | 87,300 | ||||||
Banco Popolare di Verona e Novara Scrl | 3,408 | 97,978 | ||||||
Capitalia SpA | 8,080 | 80,145 | ||||||
Intesa Sanpaolo SpA | 36,949 | 275,452 | ||||||
Intesa Sanpaolo SpA RNC | 3,588 | 25,127 | ||||||
UniCredito Italiano SpA | 37,470 | 334,631 | ||||||
989,387 | ||||||||
Construction Materials (0.0%) (a) | ||||||||
Italcementi SpA | 87 | 2,686 | ||||||
Diversified Telecommunication Services (0.3%) (a) | ||||||||
Telecom Italia SpA | 56,244 | 153,968 | ||||||
Telecom Italia SpA RNC | 27,165 | 60,198 | ||||||
214,166 | ||||||||
Electric Utilities (0.4%) (a) | ||||||||
Enel SpA | 22,162 | 238,194 | ||||||
Terna SpA | 8,614 | 29,704 | ||||||
267,898 | ||||||||
Food Products (0.1%) | ||||||||
Parmalat SpA | 9,678 | 40,901 | ||||||
Gas Utility (0.1%) (a) | ||||||||
Snam Rete Gas SpA | 5,995 | 35,445 | ||||||
Hotels, Restaurants & Leisure (0.0%) (a) | ||||||||
Autogrill SpA | 224 | 4,739 | ||||||
Lottomatica SpA | 558 | 22,136 | ||||||
26,875 | ||||||||
Industrial Conglomerate (0.0%) (a) | ||||||||
Pirelli & C SpA* | 18,383 | 21,862 | ||||||
Insurance (0.4%) (a) | ||||||||
Alleanza Assicurazioni SpA | 2,828 | 36,963 | ||||||
Assicurazioni Generali SpA | 5,087 | 203,940 | ||||||
Fondiaria-Sai SpA | 477 | 23,059 | ||||||
Mediolanum SpA | 1,681 | 13,991 | ||||||
Unipol SpA | 2,061 | 7,062 | ||||||
285,015 | ||||||||
Media (0.1%) (a) | ||||||||
Mediaset SpA | 4,771 | 49,279 | ||||||
Seat Pagine Gialle SpA | 26,221 | 15,715 | ||||||
64,994 | ||||||||
Oil, Gas & Consumable Fuels (0.6%) (a) | ||||||||
Eni SpA | 12,742 | 461,942 | ||||||
Textiles, Apparel & Luxury Goods (0.0%) (a) | ||||||||
Bulgari SpA | 846 | 13,567 | ||||||
Luxottica Group SpA | 467 | 18,140 | ||||||
31,707 | ||||||||
Transportation Infrastructure (0.0%) (a) | ||||||||
Autostrade SpA | 1,067 | 35,432 | ||||||
2,701,071 | ||||||||
JAPAN (20.3%) | ||||||||
Air Freight & Logistics (0.1%) (a) | ||||||||
Yamato Holdings Co. Ltd. | 3,000 | 42,414 | ||||||
Airlines (0.0%) (a) | ||||||||
All Nippon Airways Co. Ltd. | 3,000 | 11,415 | ||||||
Japan Airlines Corp.* | 5,000 | 9,406 | ||||||
20,821 | ||||||||
Auto Components (0.4%) (a) | ||||||||
Aisin Seiki Co. Ltd. | 1,100 | 40,364 | ||||||
Bridgestone Corp. | 3,000 | 64,319 | ||||||
Denso Corp. | 2,700 | 105,612 | ||||||
NGK Spark Plug Co. Ltd. | 1,000 | 17,372 |
Common Stocks (continued) | ||||||||
Shares or | ||||||||
Principal Amount | Value | |||||||
JAPAN (continued) | ||||||||
Auto Components (continued) | ||||||||
NHK Spring Co. Ltd. | 2,000 | $ | 19,252 | |||||
NOK Corp. | 700 | 14,776 | ||||||
Stanley Electric Co. Ltd. | 400 | 8,683 | ||||||
Sumitomo Rubber Industries, Inc. | 1,100 | 13,131 | ||||||
Toyoda Gosei Co. Ltd. | 100 | 2,820 | ||||||
Toyota Boshoku Corp. | 100 | 2,528 | ||||||
Toyota Industries Corp. | 700 | 32,528 | ||||||
321,385 | ||||||||
Automobiles (1.8%) (a) | ||||||||
Honda Motor Co. Ltd. | 7,700 | 279,638 | ||||||
Nissan Motor Co. Ltd. | 12,200 | 130,628 | ||||||
Toyota Motor Corp. | 13,600 | 857,808 | ||||||
Yamaha Motor Co. Ltd. | 1,300 | 37,724 | ||||||
1,305,798 | ||||||||
Beverages (0.2%) (a) | ||||||||
Asahi Breweries Ltd. | 1,900 | 29,469 | ||||||
Ito En Ltd. | 300 | 9,858 | ||||||
Kirin Brewery Co. Ltd. | 4,000 | 59,841 | ||||||
Takara Shuzo Co. Ltd. | 2,000 | 13,339 | ||||||
112,507 | ||||||||
Building Products (0.2%) (a) | ||||||||
Asahi Glass Co. Ltd. | 4,000 | 53,940 | ||||||
Central Glass Co. Ltd. | 1,000 | 5,589 | ||||||
Daikin Industries Ltd. | 1,400 | 50,998 | ||||||
JS Group Corp. | 900 | 18,249 | ||||||
Nippon Sheet Glass Co. Ltd. | 5,000 | 22,828 | ||||||
Sanwa Shutter Corp. | 1,000 | 5,801 | ||||||
TOTO Ltd. | 1,000 | 8,658 | ||||||
166,063 | ||||||||
Capital Markets (0.5%) (a) | ||||||||
Daiwa Securities Group, Inc. | 8,000 | 85,063 | ||||||
Jafco Co. Ltd. | 100 | 4,598 | ||||||
Matsui Securities Co. Ltd. | 500 | 4,460 | ||||||
Mitsubishi UFJ Securities Co. | 1,000 | 11,206 | ||||||
Nikko Cordial Corp. | 1,500 | 19,566 | ||||||
Nomura Holdings, Inc. | 9,000 | 174,832 | ||||||
SBI E*trade Securities Co. Ltd. | 10 | 10,608 | ||||||
SBI Holdings, Inc. | 64 | 20,305 | ||||||
Shinko Securities Co. Ltd. | 1,000 | 5,165 | ||||||
335,803 | ||||||||
Chemicals (0.9%) (a) | ||||||||
Asahi Kasei Corp. | 5,000 | 32,854 | ||||||
Dainippon Ink & Chemical, Inc. | 3,000 | 11,577 | ||||||
Denki Kagaku Kogyo KK | 1,000 | 4,501 | ||||||
Hitachi Chemical Co. Ltd. | 200 | 4,523 | ||||||
JSR Corp. | 1,100 | 26,546 | ||||||
Kaneka Corp. | 1,000 | 8,376 | ||||||
Kuraray Co. Ltd. | 1,500 | 17,585 | ||||||
Mitsubishi Chemical Holdings Corp. | 5,000 | 45,905 | ||||||
Mitsubishi Gas Chemical Co., Inc. | 1,000 | 9,130 | ||||||
Mitsubishi Rayon Co. Ltd. | 4,000 | 28,495 | ||||||
Mitsui Chemicals, Inc. | 3,000 | 22,788 | ||||||
Nippon Kayaku Co. Ltd. | 1,000 | 7,921 | ||||||
Nippon Shokubai Co. Ltd. | 1,000 | 8,884 | ||||||
Nissan Chemical Industries Ltd. | 1,000 | 11,768 | ||||||
Nitto Denko Corp. | 1,000 | 50,410 | ||||||
Shin-Etsu Chemical Co. Ltd. | 2,100 | 149,953 | ||||||
Showa Denko KK | 7,000 | 25,318 | ||||||
Sumitomo Chemical Co. Ltd. | 7,000 | 46,979 | ||||||
Teijin Ltd. | 6,000 | 32,821 | ||||||
Tokuyama Corp. | 2,000 | 26,002 | ||||||
Toray Industries, Inc. | 8,000 | 59,122 | ||||||
Tosoh Corp. | 3,000 | 16,643 | ||||||
UBE Industries Ltd. | 4,000 | 12,315 | ||||||
Zeon Corp. | 1,000 | 10,632 | ||||||
671,048 | ||||||||
Commercial Banks (2.0%) | ||||||||
77 Bank Ltd. (The) (a) | 1,000 | 6,491 | ||||||
Bank of Kyoto Ltd. (a) | 1,000 | 11,981 | ||||||
Bank of Yokohama Ltd. (The) (a) | 7,000 | 49,032 | ||||||
Chiba Bank Ltd. (The) (a) | 3,000 | 26,595 | ||||||
Fukuoka Fin. Group, Inc.* | 4,000 | 26,448 | ||||||
Gunma Bank Ltd. (The) (a) | 1,000 | 6,723 | ||||||
Hachijuni Bank Ltd. (The) (a) | 1,000 | 7,044 | ||||||
Hiroshima Bank Ltd. (a) | 1,000 | 5,538 | ||||||
Hokuhoku Financial Group, Inc. (a) | 4,000 | 12,932 | ||||||
Joyo Bank Ltd. (The) (a) | 2,000 | 12,429 | ||||||
Mitsubishi UFJ Financial Group, Inc. (a) | 40 | 440,881 | ||||||
Mitsui Trust Holdings, Inc. (a) | 3,000 | 26,105 | ||||||
Mizuho Financial Group, Inc. (a) | 47 | 324,741 | ||||||
Nishi-Nippon City Bank Ltd. (The) (a) | 2,000 | 7,319 | ||||||
Resona Holdings, Inc. (a) | 26 | 62,117 | ||||||
Sapporo Hokuyo Holdings, Inc. (a) | 1 | 11,024 | ||||||
Shinsei Bank Ltd. (a) | 9,000 | 36,378 | ||||||
Shizuoka Bank Ltd. (The) (a) | 2,000 | 20,296 | ||||||
Sumitomo Mitsui Financial Group, Inc. (a) | 33 | 307,677 | ||||||
Sumitomo Trust & Banking Co. Ltd. (The) (a) | 7,000 | 66,680 |
NVIT International Index Fund (Continued)
Common Stocks (continued) | ||||||||
Shares or | ||||||||
Principal Amount | Value | |||||||
JAPAN (continued) | ||||||||
Commercial Banks (continued) | ||||||||
Suruga Bank Ltd.(a) | 1,000 | $ | 12,604 | |||||
1,481,035 | ||||||||
Commercial Services & Supplies (0.3%) (a) | ||||||||
Dai Nippon Printing Co. Ltd. | 4,000 | 59,700 | ||||||
Goodwill Group, Inc.(The) | 19 | 6,543 | ||||||
Meitec Corp. | 300 | 8,595 | ||||||
Park24 Co. Ltd. | 600 | 6,024 | ||||||
Secom Co. Ltd. | 1,500 | 70,774 | ||||||
Toppan Printing Co. Ltd. | 4,000 | 42,988 | ||||||
194,624 | ||||||||
Computers & Peripherals (0.4%) (a) | ||||||||
Fujitsu Ltd. | 10,000 | 73,671 | ||||||
Mitsumi Electric Co. Ltd. | 600 | 21,504 | ||||||
NEC Corp. | 9,000 | 46,339 | ||||||
Toshiba Corp. | 17,000 | 148,135 | ||||||
289,649 | ||||||||
Construction & Engineering (0.2%) (a) | ||||||||
Chiyoda Corp. | 1,000 | 19,057 | ||||||
JGC Corp. | 1,000 | 18,741 | ||||||
Kajima Corp. | 6,000 | 25,080 | ||||||
Nishimatsu Construction Co. Ltd. | 2,000 | 7,063 | ||||||
Obayashi Corp. | 4,000 | 21,793 | ||||||
Shimizu Corp. | 2,000 | 11,589 | ||||||
Taisei Corp. | 7,000 | 23,665 | ||||||
126,988 | ||||||||
Construction Materials (0.0%) (a) | ||||||||
Sumitomo Osaka Cement Co. Ltd. | 4,000 | 10,597 | ||||||
Taiheiyo Cement Corp. | 5,000 | 22,119 | ||||||
32,716 | ||||||||
Consumer Finance (0.3%) (a) | ||||||||
Acom Co. Ltd. | 180 | 6,458 | ||||||
Aeon Credit Service Co. Ltd. | 500 | 7,935 | ||||||
Aiful Corp. | 550 | 15,794 | ||||||
Credit Saison Co. Ltd. | 1,200 | 31,237 | ||||||
ORIX Corp. | 430 | 113,356 | ||||||
Promise Co. Ltd. | 300 | 9,257 | ||||||
Takefuji Corp. | 720 | 24,215 | ||||||
208,252 | ||||||||
Containers & Packaging (0.0%) (a) | ||||||||
Toyo Seikan Kaisha Ltd. | 400 | 7,733 | ||||||
Diversified Consumer Services (0.0%) (a) | ||||||||
Benesse Corp. | 200 | 5,795 | ||||||
Diversified Financial Services (0.0%) (a) | ||||||||
Mitsubishi Ufj Lease & Finance Co. Ltd.* | 100 | 4,492 | ||||||
Diversified Telecommunication Services (0.2%) (a) | ||||||||
Nippon TeleGraph & Telephone Corp. | 28 | 123,924 | ||||||
Electric Utilities (0.7%) (a) | ||||||||
Chubu Electric Power Co., Inc. | 3,700 | 98,184 | ||||||
Hokkaido Electric Power Co., Inc. | 600 | 13,027 | ||||||
Kansai Electric Power Co., Inc. | 4,300 | 101,707 | ||||||
Kyushu Electric Power Co., Inc. | 1,600 | 41,940 | ||||||
Tohoku Electric Power Co., Inc. | 1,800 | 40,382 | ||||||
Tokyo Electric Power Co., Inc. | 6,400 | 205,893 | ||||||
501,133 | ||||||||
Electrical Equipment (0.2%) (a) | ||||||||
Fuji Electric Holdings Co. Ltd. | 2,000 | 10,146 | ||||||
Fujikura Ltd. | 1,000 | 7,428 | ||||||
Furukawa Electric Co. Ltd. | 3,000 | 16,570 | ||||||
Matsushita Electric Works Ltd. | 1,000 | 12,787 | ||||||
Mitsubishi Electric Corp. | 9,000 | 83,382 | ||||||
Sumitomo Electric Industries Ltd. | 3,000 | 44,672 | ||||||
Ushio, Inc. | 200 | 4,437 | ||||||
179,422 | ||||||||
Electronic Equipment & Instruments (1.0%) (a) | ||||||||
Alps Electric Co. Ltd. | 1,300 | 12,990 | ||||||
Citizen Watch Co. Ltd. | 1,500 | 13,529 | ||||||
Dainippon Screen Manufacturing Co. Ltd. | 1,000 | 7,548 | ||||||
Hirose Electric Co. Ltd. | 100 | 13,152 | ||||||
Hitachi Ltd. | 16,000 | 113,238 | ||||||
Hoya Corp. | 2,400 | 79,625 | ||||||
Ibiden Co. Ltd. | 700 | 45,172 | ||||||
Keyence Corp. | 200 | 43,698 | ||||||
Kyocera Corp. | 900 | 95,625 | ||||||
Mabuchi Motor Co. Ltd. | 100 | 6,125 | ||||||
Murata Manufacturing Co. Ltd. | 1,000 | 75,250 | ||||||
Nidec Corp. | 400 | 23,470 | ||||||
Nippon Electric Glass Co. Ltd. | 2,500 | 44,082 | ||||||
Oki Electric Industry Co. Ltd. | 5,000 | 9,281 | ||||||
Omron Corp. | 800 | 21,002 | ||||||
Taiyo Yuden Co. Ltd. | 1,000 | 23,134 | ||||||
TDK Corp. | 700 | 67,756 | ||||||
Yaskawa Electric Corp. | 1,000 | 11,368 | ||||||
Yokogawa Electric Corp. | 1,600 | 21,451 | ||||||
727,496 | ||||||||
Food & Staples Retailing (0.3%) (a) | ||||||||
AEON Mall Co. Ltd. | 3,000 | 55,692 |
Common Stocks (continued) | ||||||||
Shares or | ||||||||
Principal Amount | Value | |||||||
JAPAN (continued) | ||||||||
Food & Staples Retailing (continued) | ||||||||
FamilyMart Co. Ltd. | 300 | $ | 7,907 | |||||
Lawson, Inc. | 300 | 10,378 | ||||||
Seven & I Holdings Co. Ltd. | 3,900 | 111,497 | ||||||
UNY Co. Ltd. | 2,000 | 23,710 | ||||||
209,184 | ||||||||
Food Products (0.2%) (a) | ||||||||
Ajinomoto Co., Inc. | 4,000 | 46,078 | ||||||
Kikkoman Corp. | 1,000 | 14,856 | ||||||
Meiji Dairies Corp. | 3,000 | 19,113 | ||||||
Meiji Seika Kaisha Ltd. | 1,000 | 4,575 | ||||||
Nichirei Corp. | 2,000 | 10,292 | ||||||
Nippon Meat Packers, Inc. | 1,000 | 12,097 | ||||||
Nisshin Seifun Group, Inc. | 1,000 | 9,893 | ||||||
Nissin Food Products Co. Ltd. | 200 | 6,705 | ||||||
Toyo Suisan Kaisha Ltd. | 1,000 | 18,039 | ||||||
Yakult Honsha Co. Ltd. | 300 | 7,587 | ||||||
149,235 | ||||||||
Gas Utilities (0.1%) (a) | ||||||||
Osaka Gas Co. Ltd. | 8,000 | 29,730 | ||||||
Tokyo Gas Co. Ltd. | 13,000 | 61,651 | ||||||
91,381 | ||||||||
Health Care Equipment & Supplies (0.1%) (a) | ||||||||
Olympus Corp. | 1,000 | 39,019 | ||||||
Terumo Corp. | 900 | 34,778 | ||||||
73,797 | ||||||||
Health Care Providers & Services (0.0%) (a) | ||||||||
Mediceo Paltac Holdings Co. Ltd. | 500 | 7,658 | ||||||
Suzuken Co. Ltd. | 200 | 6,248 | ||||||
13,906 | ||||||||
Hotels, Restaurants & Leisure (0.0%) (a) | ||||||||
Oriental Land Co. Ltd. | 100 | 5,223 | ||||||
Round One Corp. | 4 | 7,263 | ||||||
12,486 | ||||||||
Household Durables (1.0%) (a) | ||||||||
Casio Computer Co. Ltd. | 1,500 | 23,391 | ||||||
Daito Trust Construction Co. Ltd. | 600 | 28,574 | ||||||
Daiwa House Industry Co. Ltd. | 2,000 | 28,589 | ||||||
Haseko Corp.* | 3,000 | 8,873 | ||||||
Makita Corp. | 800 | 35,644 | ||||||
Matsushita Electric Industrial Co. Ltd. | 10,000 | 198,196 | ||||||
Pioneer Corp. | 1,300 | 17,683 | ||||||
Sanyo Electric Co. Ltd.* | 10,000 | 16,376 | ||||||
Sekisui Chemical Co. Ltd. | 1,000 | 7,729 | ||||||
Sekisui House Ltd. | 3,000 | 39,993 | ||||||
Sharp Corp. | 5,000 | 94,799 | ||||||
Sony Corp. | 5,200 | 266,958 | ||||||
766,805 | ||||||||
Household Products (0.1%) (a) | ||||||||
Kao Corp. | 2,000 | 51,789 | ||||||
Uni-Charm Corp. | 200 | 11,340 | ||||||
63,129 | ||||||||
Independent Power Producers & Energy Traders (0.0%) (a) | ||||||||
Electric Power Development Co. | 800 | 31,794 | ||||||
Industrial Conglomerate— 0.0%(a) Hankyu Hanshin Holdings, Inc. | 5,000 | 26,406 | ||||||
Insurance— 0.5%(a) Millea Holdings, Inc. | 4,100 | 168,581 | ||||||
Mitsui Sumitomo Insurance Co. Ltd. | 6,000 | 76,988 | ||||||
Sompo Japan Insurance, Inc. | 4,000 | 48,929 | ||||||
T&D Holdings, Inc. | 1,100 | 74,296 | ||||||
368,794 | ||||||||
Internet & Catalog Retail (0.0%) (a) | ||||||||
Rakuten, Inc. | 49 | 16,475 | ||||||
Internet Software & Services (0.1%) (a) | ||||||||
Access Company Ltd.* | 3 | 9,049 | ||||||
eAccess Ltd. | 13 | 7,758 | ||||||
Yahoo! Japan Corp. | 59 | 20,005 | ||||||
36,812 | ||||||||
IT Services (0.1%) (a) | ||||||||
CSK Corp. | 500 | 17,610 | ||||||
Itochu Techno-Science Corp. | 100 | 3,922 | ||||||
Nomura Research Institute Ltd. | 500 | 14,709 | ||||||
NTT Data Corp. | 5 | 23,726 | ||||||
Obic Co. Ltd. | 10 | 1,975 | ||||||
TIS, Inc. | 300 | 6,891 | ||||||
68,833 | ||||||||
Leisure Equipment & Products (0.3%) (a) | ||||||||
Fuji Photo Film Co. Ltd. | 2,700 | 120,693 | ||||||
Namco Bandai Holdings, Inc. | 800 | 12,639 | ||||||
Nikon Corp. | 2,000 | 55,705 | ||||||
Sankyo Co. Ltd. | 200 | 8,423 | ||||||
Sega Sammy Holdings, Inc. | 1,200 | 19,420 | ||||||
Shimano, Inc. | 100 | 3,430 | ||||||
Yamaha Corp. | 500 | 10,392 | ||||||
230,702 | ||||||||
Machinery (1.1%) (a) | ||||||||
Amada Co. Ltd. | 1,000 | 12,508 | ||||||
Daifuku Co. Ltd. | 500 | 6,893 |
NVIT International Index Fund (Continued)
Common Stocks (continued) | ||||||||
Shares or | ||||||||
Principal Amount | Value | |||||||
JAPAN (continued) | ||||||||
Machinery (continued) | ||||||||
Ebara Corp. | 4,000 | $ | 18,351 | |||||
Fanuc Ltd. | 900 | 92,903 | ||||||
Hino Motors Ltd. | 1,000 | 5,979 | ||||||
Hitachi Construction Machinery Co. Ltd. | 700 | 24,325 | ||||||
Ishikawajima-Harima Heavy Industries Co. Ltd. | 9,000 | 32,828 | ||||||
Japan Steel Works Ltd.(The) | 2,000 | 30,436 | ||||||
JTEKT Corp. | 500 | 9,031 | ||||||
Kawasaki Heavy Industries Ltd. | 9,000 | 36,721 | ||||||
Komatsu Ltd. | 5,000 | 144,933 | ||||||
Komori Corp. | 1,000 | 23,441 | ||||||
Kubota Corp. | 5,000 | 40,422 | ||||||
Kurita Water Industries Ltd. | 800 | 25,120 | ||||||
Minebea Co. Ltd. | 2,000 | 11,306 | ||||||
Mitsubishi Heavy Industries Ltd. | 18,000 | 115,296 | ||||||
Mitsui Engineering & Shipbuilding Co. Ltd. | 5,000 | 26,664 | ||||||
NGK Insulators Ltd. | 2,000 | 49,124 | ||||||
NSK Ltd. | 2,000 | 20,679 | ||||||
NTN Corp. | 2,000 | 17,246 | ||||||
Okuma Corp. | 1,000 | 15,800 | ||||||
OSG Corp. | 100 | 1,378 | ||||||
SMC Corp. | 200 | 26,588 | ||||||
Sumitomo Heavy Industries Ltd. | 2,000 | 22,614 | ||||||
THK Co. Ltd. | 300 | 7,514 | ||||||
818,100 | ||||||||
Marine (0.3%) (a) | ||||||||
Kawasaki Kisen Kaisha Ltd. | 3,000 | 36,592 | ||||||
Mitsui OSK Lines Ltd. | 6,000 | 81,363 | ||||||
Nippon Yusen KK | 7,000 | 64,208 | ||||||
182,163 | ||||||||
Media (0.0%) (a) | ||||||||
Dentsu, Inc. | 7 | 19,847 | ||||||
Fuji Television Network, Inc. | 1 | 2,013 | ||||||
Toho Co. Ltd. | 400 | 7,244 | ||||||
Tokyo Broadcasting System, Inc. | 100 | 3,060 | ||||||
32,164 | ||||||||
Metals & Mining (1.0%) (a) | ||||||||
Daido Steel Co. Ltd. | 3,000 | 20,424 | ||||||
Dowa Holdings Co. Ltd. | 2,000 | 21,310 | ||||||
JFE Holdings, Inc. | 2,700 | 167,842 | ||||||
Kobe Steel Ltd. | 15,000 | 56,898 | ||||||
Mitsubishi Materials Corp. | 7,000 | 38,168 | ||||||
Mitsui Metals & Mining & Mining & Smelting Co. Ltd. | 2,000 | 9,333 | ||||||
Nippon Light Metal Co. Ltd. | 1,000 | 2,610 | ||||||
Nippon Steel Corp. | 28,000 | 196,990 | ||||||
Nisshin Steel Co. Ltd. | 3,000 | 13,692 | ||||||
Sumitomo Metal Industries Ltd. | 21,000 | 123,477 | ||||||
Sumitomo Metal Metals & Mining & Mining Co. Ltd. | 3,000 | 65,044 | ||||||
Sumitomo Titanium Corp. | 100 | 9,338 | ||||||
Toho Titanium Co. Ltd. | 141 | 5,716 | ||||||
Tokyo Steel Manufacturing Co. Ltd. | 800 | 12,530 | ||||||
743,372 | ||||||||
Multiline Retail (0.2%) (a) | ||||||||
Daimaru, Inc. | 1,000 | 11,945 | ||||||
Hankyu Department Stores, Inc. | 1,000 | 10,648 | ||||||
Isetan Co. Ltd. | 1,400 | 23,004 | ||||||
Marui Co. Ltd. | 2,100 | 26,536 | ||||||
Mitsukoshi Ltd. | 4,000 | 20,021 | ||||||
Ryohin Keikaku Co. Ltd. | 200 | 12,381 | ||||||
Takashimaya Co. Ltd. | 1,000 | 12,636 | ||||||
117,171 | ||||||||
Office Electronics (0.6%) (a) | ||||||||
Canon, Inc. | 5,200 | 304,981 | ||||||
Konica Minolta Holdings, Inc. | 3,000 | 44,221 | ||||||
Ricoh Co. Ltd. | 3,000 | 69,418 | ||||||
Seiko Epson Corp. | 500 | 14,475 | ||||||
433,095 | ||||||||
Oil, Gas & Consumable Fuels (0.3%) (a) | ||||||||
Idemitsu Kosan Co Ltd | 200 | 22,384 | ||||||
Inpex Holdings, Inc. | 3 | 28,037 | ||||||
Japan Petroleum Exploration Co. Ltd. | 200 | 14,123 | ||||||
Nippon Metals & Mining Holdings, Inc. | 4,000 | 38,272 | ||||||
Nippon Oil Corp. | 7,000 | 65,022 | ||||||
Showa Shell Sekiyu KK | 1,200 | 14,882 | ||||||
TonenGeneral Sekiyu KK | 1,000 | 9,755 | ||||||
192,475 | ||||||||
Paper & Forest Products (0.0%) (a) | ||||||||
Nippon Paper Group, Inc. | 4 | 13,321 | ||||||
OJI Paper Co. Ltd. | 3,000 | 14,586 | ||||||
27,907 | ||||||||
Common Stocks (continued) | ||||||||
Shares or | ||||||||
Principal Amount | Value | |||||||
JAPAN (continued) | ||||||||
Personal Products (0.0%) (a) | ||||||||
Aderans Co. Ltd. | 400 | $ | 8,424 | |||||
KOSE Corp. | 100 | 2,831 | ||||||
Shiseido Co. Ltd. | 1,000 | 21,349 | ||||||
32,604 | ||||||||
Pharmaceuticals (0.9%) (a) | ||||||||
Astellas Pharma, Inc. | 2,900 | 126,158 | ||||||
Chugai Pharmaceutical Ltd. | 1,700 | 30,551 | ||||||
Daiichi Sankyo Co. Ltd. | 3,900 | 103,490 | ||||||
Eisai Co. Ltd. | 1,500 | 65,509 | ||||||
Kyowa Hakko Kogyo Co. Ltd. | 3,000 | 28,314 | ||||||
Santen Pharmaceutical Co. Ltd. | 100 | 2,435 | ||||||
Shionogi & Co. Ltd. | 2,000 | 32,604 | ||||||
Takeda Pharmaceutical Co. Ltd. | 4,400 | 284,281 | ||||||
673,342 | ||||||||
Real Estate Investment Trusts (REITs) (0.2%) (a) | ||||||||
Japan Prime Realty Investment Corp. | 2 | 7,802 | ||||||
Japan Real Estate Investment Corp. | 3 | 35,261 | ||||||
Japan Retail Fund Investment Corp. | 3 | 26,005 | ||||||
Nippon Building Fund, Inc. | 3 | 41,621 | ||||||
110,689 | ||||||||
Real Estate Management & Development (0.6%) (a) | ||||||||
Aeon Mall Co. Ltd. | 100 | 3,075 | ||||||
K.K. DaVinci Advisors* | 8 | 6,985 | ||||||
Leopalace21 Corp. | 500 | 17,088 | ||||||
Mitsubishi Estate Co. Ltd. | 6,000 | 162,804 | ||||||
Mitsui Fudosan Co. Ltd. | 5,000 | 140,159 | ||||||
NTT Urban Development Corp | 2 | 3,873 | ||||||
Sumitomo Realty & Development Co. Ltd. | 2,000 | 65,141 | ||||||
Tokyo Tatemono Co. Ltd. | 1,000 | 12,451 | ||||||
Tokyu Land Corp. | 2,000 | 21,269 | ||||||
432,845 | ||||||||
Road & Rail (0.6%) (a) | ||||||||
Central Japan Railway Co. | 9 | 94,966 | ||||||
East Japan Railway Co. | 18 | 138,711 | ||||||
Keihin Electric Express Railway Co. Ltd. | 1,000 | 6,603 | ||||||
Keio Corp. | 2,000 | 13,318 | ||||||
Kintetsu Corp. | 5,000 | 15,062 | ||||||
Nippon Express Co. Ltd. | 2,000 | 11,370 | ||||||
Odakyu Electric Railway Co. Ltd. | 4,000 | 24,669 | ||||||
Tobu Railway Co. Ltd. | 4,000 | 18,084 | ||||||
Tokyu Corp. | 7,000 | 46,790 | ||||||
West Japan Railway Co. | 11 | 51,225 | ||||||
420,798 | ||||||||
Semiconductors & Semiconductor Equipment (0.3%) (a) | ||||||||
Advantest Corp. | 800 | 34,836 | ||||||
Elpida Memory, Inc.* | 600 | 26,351 | ||||||
NEC Electrical Components & Equipment Corp.* | 100 | 2,627 | ||||||
Rohm Co. Ltd. | 400 | 35,502 | ||||||
Sanken Electric Co. Ltd. | 1,000 | 9,675 | ||||||
Shinko Electric Industries | 500 | 10,762 | ||||||
Sumco Corp. | 400 | 20,045 | ||||||
Tokyo Electron Ltd. | 1,000 | 73,578 | ||||||
Tokyo Seimitsu Co. Ltd. | 300 | 11,595 | ||||||
224,971 | ||||||||
Software (0.3%) (a) | ||||||||
FUJI SOFT, Inc. | 300 | 7,057 | ||||||
Konami Corp. | 400 | 9,188 | ||||||
Nintendo Co. Ltd. | 500 | 182,444 | ||||||
Oracle Corp. | 100 | 4,414 | ||||||
Trend Micro, Inc. | 500 | 16,145 | ||||||
219,248 | ||||||||
Specialty Retail (0.1%) (a) | ||||||||
Aoyama Trading Co. Ltd. | 100 | 3,076 | ||||||
EDION Corp. | 100 | 1,299 | ||||||
Fast Retailing Co. Ltd. | 200 | 14,237 | ||||||
Hikari Tsushin, Inc. | 100 | 4,201 | ||||||
Nitori Co. Ltd. | 150 | 7,489 | ||||||
Shimachu Co. Ltd. | 400 | 10,757 | ||||||
Shimamura Co. Ltd. | 100 | 10,685 | ||||||
USS Co. Ltd. | 130 | 8,278 | ||||||
Yamada Denki Co. Ltd. | 300 | 31,335 | ||||||
91,357 | ||||||||
Textiles, Apparel & Luxury Goods (0.1%) (a) | ||||||||
Asics Corp. | 1,000 | 12,357 | ||||||
Nisshinbo Industries, Inc. | 1,000 | 13,969 | ||||||
Onward Kashiyama Co. Ltd. | 1,000 | 12,766 | ||||||
Toyobo Co. Ltd. | 6,000 | 17,172 | ||||||
56,264 | ||||||||
Tobacco (0.2%) (a) | ||||||||
Japan Tobacco, Inc. | 24 | 118,316 | ||||||
Trading Companies & Distributors (0.9%) (a) | ||||||||
Hitachi High-Technologies Corp. | 100 | 2,595 | ||||||
Itochu Corp. | 8,000 | 92,646 | ||||||
Marubenii Corp. | 9,000 | 74,044 | ||||||
Mitsubishi Corp. | 7,200 | 188,678 | ||||||
Mitsui & Co. Ltd. | 7,000 | 139,716 | ||||||
Sojitz Corp. | 6,100 | 27,268 | ||||||
Sumitomo Corp. | 6,000 | 109,402 |
NVIT International Index Fund (Continued)
Common Stocks (continued) | ||||||||
Shares or | ||||||||
Principal Amount | Value | |||||||
JAPAN (continued) | ||||||||
Trading Companies & Distributors (continued) | ||||||||
Toyota Tsusho Corp. | 1,000 | $ | 23,133 | |||||
657,482 | ||||||||
Transportation Infrastructure (0.0%) (a) | ||||||||
Mitsubishi Logistics Corp. | 1,000 | 16,463 | ||||||
Wireless Telecommunication Services (0.4%) (a) | ||||||||
KDDI Corp. | 13 | 96,316 | ||||||
NTT DoCoMo, Inc. | 76 | 120,216 | ||||||
Softbank Corp. | 3,500 | 75,433 | ||||||
291,965 | ||||||||
14,911,628 | ||||||||
JERSEY (0.1%) (a) | ||||||||
Commercial Services & Supplies 0.1% | ||||||||
Experian Group Ltd. | 5,717 | 71,939 | ||||||
LUXEMBOURG (0.0%) (a) | ||||||||
Energy Equipment & Services (0.0%) | ||||||||
Acergy SA | 700 | 15,766 | ||||||
NETHERLANDS (4.0%) (a) | ||||||||
Aerospace & Defense (0.1%) | ||||||||
European Aeronautic Defense and Space Co. NV | 1,879 | 60,974 | ||||||
Air Freight & Logistics (0.2%) | ||||||||
TNT NV | 2,444 | 110,339 | ||||||
Beverages (0.1%) | ||||||||
Heineken NV | 1,113 | 65,239 | ||||||
Chemicals (0.2%) | ||||||||
Akzo Nobel NV | 1,292 | 111,513 | ||||||
Koninklijke DSM NV | 931 | 45,847 | ||||||
157,360 | ||||||||
Commercial Bank (0.6%) | ||||||||
ABN AMRO Holding NV | 8,823 | 404,511 | ||||||
Commercial Services & Supplies (0.1%) | ||||||||
Buhrmann NV | 1,042 | 15,977 | ||||||
Randstad Holdings NV | 177 | 14,008 | ||||||
Vedior NV | 1,080 | 32,271 | ||||||
62,256 | ||||||||
Diversified Financial Services (0.5%) | ||||||||
ING Groep NV | 9,086 | 399,866 | ||||||
Diversified Telecommunication Services (0.2%) | ||||||||
Koninklijke KPN NV | 10,437 | 173,139 | ||||||
Energy Equipment & Services (0.1%) | ||||||||
FuGro NV | 170 | 10,769 | ||||||
SBM Offshore NV | 931 | 35,504 | ||||||
46,273 | ||||||||
Food & Staples Retailing (0.1%) | ||||||||
Koninklijke Ahold NV* | 7,918 | 99,304 | ||||||
Food Products (0.4%) | ||||||||
Royal NumiCo NV | 999 | 51,908 | ||||||
Unilever NV | 8,238 | 255,629 | ||||||
307,537 | ||||||||
Household Durables (0.3%) | ||||||||
Koninklijke Philips Electronics NV | 5,683 | 240,802 | ||||||
Insurance (0.2%) | ||||||||
Aegon NV | 7,265 | 142,974 | ||||||
Life Sciences Tools & Services (0.0%) | ||||||||
Qiagen NV* | 447 | 7,976 | ||||||
Media (0.2%) | ||||||||
Reed Elsevier NV | 4,111 | 78,124 | ||||||
Wolters Kluwer NV | 1,725 | 52,598 | ||||||
130,722 | ||||||||
Metals & Mining (0.4%) | ||||||||
Mittal Steel Co. NV | 4,143 | 258,919 | ||||||
Mittal Steel Co. NV | 400 | 24,978 | ||||||
283,897 | ||||||||
Office Electronics (0.0%) | ||||||||
OCE NV | 62 | 1,209 | ||||||
Real Estate Investment Trusts (REITs) (0.1%) | ||||||||
Corio NV | 103 | 8,067 | ||||||
RodamCo Europe NV | 290 | 38,560 | ||||||
Wereldhave NV | 118 | 16,436 | ||||||
63,063 | ||||||||
Semiconductors & Semiconductor Equipment (0.2%) | ||||||||
ASML Holding NV* | 2,614 | 71,813 | ||||||
STMicroElectrical Components & Equipment NV | 3,917 | 75,481 | ||||||
147,294 | ||||||||
Trading Companies & Distributors (0.0%) | ||||||||
Hagemeyer NV | 2,624 | 13,520 | ||||||
2,918,255 | ||||||||
NEW ZEALAND (0.1%) (a) | ||||||||
Construction Materials (0.0%) | ||||||||
Fletcher Building Ltd. | 2,203 | 20,977 | ||||||
Common Stocks (continued) | ||||||||
Shares or | ||||||||
Principal Amount | Value | |||||||
NEW ZEALAND (continued) | ||||||||
Diversified Telecommunication Services (0.1%) | ||||||||
TeleCom Corp. of New Zealand Ltd. | 12,769 | $ | 44,777 | |||||
Electric Utility (0.0%) | ||||||||
Contact Energy Ltd. | 170 | 1,180 | ||||||
Health Care Equipment & Supplies (0.0%) | ||||||||
Fisher & Paykel Health Care Corp. | 1,770 | 4,595 | ||||||
Hotels, Restaurants & Leisure (0.0%) | ||||||||
Sky City Entertainment Group Ltd. | 1,197 | 4,687 | ||||||
Household Durables (0.0%) | ||||||||
Fisher & Paykel Appliances Holdings Ltd. | 2,348 | 6,295 | ||||||
Real Estate Investment Trust (REIT) (0.0%) | ||||||||
Kiwi Income Property Trust | 7,834 | 9,964 | ||||||
Transportation Infrastructure (0.0%) | ||||||||
Auckland International Airport Ltd. | 920 | 2,324 | ||||||
94,799 | ||||||||
NORWAY (1.0%) | ||||||||
Chemicals (0.1%) (a) | ||||||||
Yara International ASA | 1,200 | 35,999 | ||||||
Commercial Bank (0.1%) (a) | ||||||||
DNB NOR ASA | 4,000 | 51,473 | ||||||
Commercial Services & Supplies (0.0%) (a) | ||||||||
Tomra Systems ASA | 800 | 6,985 | ||||||
Communications Equipment (0.0%) (a) | ||||||||
Tandberg ASA | 700 | 15,624 | ||||||
Diversified Telecommunication Services (0.1%) (a) | ||||||||
Telenor ASA | 4,200 | 82,132 | ||||||
Electrical Equipment (0.1%) (a) | ||||||||
Renewable Energy Corp. AS* | 891 | 34,522 | ||||||
Energy Equipment & Services (0.2%) | ||||||||
Aker Kvaerner ASA (a) | 1,047 | 26,513 | ||||||
Ocean RIG ASA* (a) | 1,068 | 7,932 | ||||||
Petoleum Geo-Services ASA | 1,097 | 27,405 | ||||||
Prosafe ASA (a) | 1,258 | 20,124 | ||||||
SeaDrill Ltd.* (a) | 1,554 | 33,352 | ||||||
TGS Nopec Geophysical Co ASA* (a) | 304 | 6,223 | ||||||
121,549 | ||||||||
Food Products (0.0%) (a) | ||||||||
Pan Fish ASA* | 12,579 | 13,589 | ||||||
Industrial Conglomerate (0.1%) (a) | ||||||||
Orkla ASA | 4,287 | 80,866 | ||||||
Insurance (0.0%) (a) | ||||||||
Storebrand ASA | 1,200 | 18,596 | ||||||
Marine (0.0%) (a) | ||||||||
Stolt-Nielsen SA | 50 | 1,666 | ||||||
Media (0.0%) (a) | ||||||||
Nok Schibsted ASA | 50 | 2,286 | ||||||
Oil, Gas & Consumable Fuels (0.3%) (a) | ||||||||
DET Norske Oljeselskap* | 5,942 | 12,429 | ||||||
Norsk Hydro ASA | 3,406 | 130,695 | ||||||
Statoil ASA | 3,550 | 110,189 | ||||||
253,313 | ||||||||
Paper & Forest Products (0.0%) (a) | ||||||||
Norske Skogindustrier ASA | 800 | 11,518 | ||||||
730,118 | ||||||||
PORTUGAL (0.4%) (a) | ||||||||
Commercial Banks (0.2%) | ||||||||
Banco BPI SA | 1,680 | 14,941 | ||||||
Banco Comercial Portugues SA | 12,922 | 72,207 | ||||||
Banco Espirito Santo SA | 766 | 17,076 | ||||||
104,224 | ||||||||
Construction Materials (0.0%) | ||||||||
Cimpor Cimentos de Portugal SA | 689 | 6,507 | ||||||
Diversified Telecommunication Services (0.1%) | ||||||||
Portugal TeleCom SGPS SA | 3,436 | 47,505 | ||||||
Electric Utility (0.1%) | ||||||||
EDP - Energias de Portugal SA | 11,097 | 61,356 | ||||||
Industrial Conglomerate (0.0%) | ||||||||
Sonae SGPS SA | 7,096 | 20,143 | ||||||
Media (0.0%) | ||||||||
PT Multimedia Servicos SA | 44 | 708 | ||||||
Paper & Forest Products (0.0%) | ||||||||
Sonae Industria SGPS SA* | 236 | 3,430 | ||||||
Transportation Infrastructure (0.0%) | ||||||||
Brisa-Auto Estradas de Portugal SA | 904 | 12,150 | ||||||
256,023 | ||||||||
NVIT International Index Fund (Continued)
Common Stocks (continued) | ||||||||
Shares or | ||||||||
Principal Amount | Value | |||||||
SINGAPORE (1.0%) (a) | ||||||||
Aerospace & Defense (0.0%) | ||||||||
Singapore Technologies Engineering Ltd. | 4,000 | $ | 9,423 | |||||
Airline (0.0%) | ||||||||
Singapore Airlines Ltd. | 2,000 | 24,584 | ||||||
Commercial Banks (0.4%) | ||||||||
DBS Group Holdings Ltd. | 6,000 | 89,418 | ||||||
Oversea-Chinese Banking Corp. | 12,000 | 71,752 | ||||||
United Overseas Bank Ltd. | 7,000 | 100,652 | ||||||
261,822 | ||||||||
Diversified Financial Services (0.1%) | ||||||||
Singapore Exchange Ltd. | 5,000 | 32,086 | ||||||
Diversified Telecommunication Services (0.1%) | ||||||||
Singapore Telecommunications Ltd. | 37,850 | 84,198 | ||||||
Electronic Equipment & Instruments (0.0%) | ||||||||
Venture Corp. Ltd. | 1,000 | 10,254 | ||||||
Food & Staples Retailing (0.0%) | ||||||||
Olam International Ltd. | 5,000 | 10,089 | ||||||
Health Care Providers & Services (0.0%) | ||||||||
Parkway Holdings Ltd. | 2,000 | 5,237 | ||||||
Industrial Conglomerates (0.1%) | ||||||||
Fraser & Neave Ltd. | 1,745 | 6,222 | ||||||
Keppel Corp. Ltd. | 6,000 | 49,095 | ||||||
Sembcorp Industries Ltd. | 2,000 | 7,456 | ||||||
62,773 | ||||||||
Machinery (0.0%) | ||||||||
Sembcorp Marine Ltd. | 7,000 | 22,454 | ||||||
Marine (0.0%) | ||||||||
CosCo Corp. Singapore Ltd. | 8,000 | 19,543 | ||||||
Neptune Orient Lines Ltd. | 1,000 | 3,467 | ||||||
23,010 | ||||||||
Media (0.0%) | ||||||||
Singapore Press Holdings Ltd. | 7,000 | 21,232 | ||||||
Oil, Gas & Consumable Fuels (0.0%) | ||||||||
Singapore Petroleum Co. Ltd. | 3,000 | 11,286 | ||||||
Real Estate Investment Trusts (REITs) (0.1%) | ||||||||
Ascendas Real Estate Investment Trust | 1,000 | 1,924 | ||||||
Capitacommerical Trust | 2,000 | 3,831 | ||||||
CapitaMall Trust | 4,000 | 11,047 | ||||||
Suntec Real Estate Investment Trust | 9,000 | 11,431 | ||||||
28,233 | ||||||||
Real Estate Management & Development (0.2%) | ||||||||
Allgreen Properties Ltd. | 8,000 | 10,951 | ||||||
CapitaLand Ltd. | 10,000 | 52,993 | ||||||
City Developments Ltd. | 3,000 | 33,921 | ||||||
Keppel Land Ltd. | 2,000 | 11,465 | ||||||
UOL Group Ltd. | 4,000 | 15,212 | ||||||
Wing Tai Holdings Ltd. | 4,000 | 10,421 | ||||||
134,963 | ||||||||
Road & Rail (0.0%) | ||||||||
ComfortDelGro Corp. Ltd. | 5,000 | 7,130 | ||||||
Semiconductors & Semiconductor Equipment (0.0%) | ||||||||
Chartered SemiConductor Manufacturing Ltd.* | 8,000 | 7,038 | ||||||
755,812 | ||||||||
SPAIN (3.8%) | ||||||||
Airline (0.0%) (a) | ||||||||
Iberia Lineas Aereas de Espana SA | 3,394 | 16,891 | ||||||
Biotechnology (0.0%) (a) | ||||||||
Zeltia SA | 1,355 | 12,716 | ||||||
Commercial Banks (1.5%) (a) | ||||||||
Banco Bilbao Vizcaya Argentaria SA | 17,662 | 431,876 | ||||||
Banco Popular Espanol SA | 4,831 | 89,896 | ||||||
Banco Santander Central Hispano SA | 30,632 | 563,016 | ||||||
1,084,788 | ||||||||
Construction & Engineering (0.2%) (a) | ||||||||
Acciona SA | 120 | 32,642 | ||||||
ACS, Actividades de Construccion y Servicios SA | 1,223 | 77,748 | ||||||
Fomento de Construcciones y Contratas SA | 304 | 27,348 | ||||||
Grupo Ferrovial SA | 353 | 34,698 | ||||||
Sacyr Vallehermoso SA | 318 | 15,254 | ||||||
187,690 | ||||||||
Diversified Telecommunication Services (0.7%) (a) | ||||||||
Telefonica SA | 21,814 | 485,398 | ||||||
Electric Utilities (0.6%) | ||||||||
Endesa SA | 3,324 | 180,880 | ||||||
Iberdrola SA | 897 | 49,453 | ||||||
Iberdrola SA (a) | 3,223 | 179,942 | ||||||
Union Fenosa SA (a) | 681 | 36,353 | ||||||
446,628 | ||||||||
Electrical Equipment (0.1%) (a) | ||||||||
Gamesa Corp. Tecnologica SA | 1,102 | 39,862 | ||||||
Common Stocks (continued) | ||||||||
Shares or | ||||||||
Principal Amount | Value | |||||||
SPAIN (continued) | ||||||||
Food Products (0.0%) (a) | ||||||||
Ebro Puleva SA | 519 | $ | 11,156 | |||||
Gas Utility (0.1%) (a) | ||||||||
Gas Natural SDG SA | 828 | 50,300 | ||||||
Insurance (0.0%) (a) | ||||||||
Corporacion Mapfre SA | 1,137 | 5,625 | ||||||
IT Services (0.0%) (a) | ||||||||
Indra Sistemas SA | 651 | 16,232 | ||||||
Machinery (0.0%) (a) | ||||||||
Zardoya Otis SA | 344 | 13,476 | ||||||
Media (0.1%) (a) | ||||||||
Antena 3 Television SA | 421 | 8,749 | ||||||
Gestevision Telecinco SA | 810 | 22,914 | ||||||
Promotora de Informaciones SA | 113 | 2,479 | ||||||
Sogecable SA* | 219 | 9,151 | ||||||
43,293 | ||||||||
Metals & Mining (0.0%) (a) | ||||||||
Acerinox SA | 1,149 | 28,024 | ||||||
Oil, Gas & Consumable Fuels (0.2%) | ||||||||
Repsol YPF SA | 4,163 | 164,789 | ||||||
Specialty Retail (0.1%) (a) | ||||||||
Inditex SA* | 980 | 57,676 | ||||||
Tobacco (0.1%) (a) | ||||||||
Altadis SA | 1,449 | 95,753 | ||||||
Transportation Infrastructure (0.1%) (a) | ||||||||
Abertis Infraestructuras SA | 902 | 27,971 | ||||||
Cintra Concesiones de Infraestructuras de Transporte SA | 1,603 | 25,465 | ||||||
53,436 | ||||||||
Water Utility (0.0%) (a) | ||||||||
Sociedad General de Aguas de Barcelona SA | 68 | 2,493 | ||||||
2,816,226 | ||||||||
SWEDEN (2.5%) (a) | ||||||||
Airline (0.0%) | ||||||||
Sek Sas AB* | 200 | 4,601 | ||||||
Building Products (0.1%) | ||||||||
AB SKF, B Shares | 2,455 | 51,383 | ||||||
Assa Abloy AB | 1,600 | 35,219 | ||||||
86,602 | ||||||||
Capital Markets (0.0%) | ||||||||
D. Carnegie & Co. AB | 700 | 12,206 | ||||||
Commercial Banks (0.4%) | ||||||||
Nordea Bank AB | 10,000 | 156,239 | ||||||
Skandinaviska Enskilda Banken AB | 2,600 | 83,738 | ||||||
Svenska Handelsbanked AB, A Shares | 2,800 | 78,323 | ||||||
318,300 | ||||||||
Commercial Services & Supplies (0.1%) | ||||||||
Securitas AB | 2,200 | 34,834 | ||||||
Securitas Systems AB | 1,200 | 4,077 | ||||||
38,911 | ||||||||
Communications Equipment (0.4%) | ||||||||
Telefonakitiebolaget LM Ericsson, B Shares | 73,000 | 291,283 | ||||||
Construction & Engineering (0.1%) | ||||||||
Skanska AB | 1,800 | 38,557 | ||||||
Diversified Consumer Services (0.0%) | ||||||||
Securitas Direct AB* | 1,200 | 3,238 | ||||||
Diversified Financial Services (0.0%) | ||||||||
OMX AB | 600 | 17,875 | ||||||
Diversified Telecommunication Services (0.2%) | ||||||||
Tele2 AB | 2,000 | 32,634 | ||||||
TeliaSonera AB | 12,000 | 88,062 | ||||||
120,696 | ||||||||
Health Care Equipment & Supplies (0.0%) | ||||||||
Elekta AB | 200 | 3,462 | ||||||
Getinge AB | 400 | 8,620 | ||||||
12,082 | ||||||||
Household Durables (0.0%) | ||||||||
Husqvarna AB | 1,100 | 15,576 | ||||||
Household Products (0.1%) | ||||||||
Electroloux AB, B Shares | 1,635 | 38,724 | ||||||
Machinery (0.6%) | ||||||||
Alfa Laval AB | 400 | 24,108 | ||||||
Atlas Copco Ab B | 1,600 | 25,037 | ||||||
Atlas Copco AB, B Shares | 3,873 | 64,531 | ||||||
Sandvik AB | 5,185 | 104,530 | ||||||
Scania AB, B Shares | 1,863 | 45,454 | ||||||
Trelleborg AB, Class B | 200 | 5,505 | ||||||
Volvo AB | 2,022 | 41,427 | ||||||
Volvo AB, Class B | 5,520 | 109,787 | ||||||
420,379 | ||||||||
NVIT International Index Fund (Continued)
Common Stocks (continued) | ||||||||
Shares or | ||||||||
Principal Amount | Value | |||||||
SWEDEN (continued) | ||||||||
Media (0.0%) | ||||||||
Eniro AB | 1,200 | $ | 15,224 | |||||
Modern Times Group AB | 169 | 10,896 | ||||||
26,120 | ||||||||
Metals & Mining (0.1%) | ||||||||
Boliden AB | 1,735 | 35,981 | ||||||
Ssab Svenskt Stal AB | 1,018 | 41,614 | ||||||
Ssab Svenskt Stal AB, Series B | 82 | 3,108 | ||||||
80,703 | ||||||||
Oil, Gas & Consumable Fuels (0.0%) | ||||||||
Lundin Petroleum AB* | 800 | 7,972 | ||||||
Paper & Forest Products (0.1%) | ||||||||
Holmen AB | 100 | 4,226 | ||||||
Svenska Cellusoa AB, B Shares | 3,342 | 55,906 | ||||||
60,132 | ||||||||
Personal Products (0.0%) | ||||||||
Oriflame Cosmetics SA | 100 | 4,696 | ||||||
Real Estate Management & Development (0.0%) | ||||||||
Castellum AB | 191 | 2,297 | ||||||
Fabege AB | 1,000 | 10,960 | ||||||
Kungsleden AB | 190 | 2,365 | ||||||
Wihlborgs Fastigheter AB | 317 | 5,593 | ||||||
21,215 | ||||||||
Specialty Retail (0.2%) | ||||||||
Hennes & Mauritz AB | 2,500 | 147,863 | ||||||
Nobia AB | 195 | 2,429 | ||||||
150,292 | ||||||||
Tobacco (0.1%) | ||||||||
Swedish Match AB | 1,800 | 34,733 | ||||||
1,804,893 | ||||||||
SWITZERLAND (6.4%) (a) | ||||||||
Auto Components (0.0%) | ||||||||
Rieter Holding AG | 6 | 3,137 | ||||||
Building Products (0.0%) | ||||||||
Geberit AG | 151 | 25,735 | ||||||
Capital Markets (1.4%) | ||||||||
Credit Suisse Group | 5,503 | 390,760 | ||||||
UBS AG | 10,428 | 623,792 | ||||||
1,014,552 | ||||||||
Chemicals (0.3%) | ||||||||
Ciba Specialty Chemicals AG | 340 | 22,097 | ||||||
Clariant AG | 1,547 | 25,047 | ||||||
Givaudan | 42 | 41,427 | ||||||
Lonza Group AG | 212 | 19,456 | ||||||
Syngenta AG | 581 | 113,294 | ||||||
221,321 | ||||||||
Commercial Services & Supplies (0.1%) | ||||||||
Adecco SA | 770 | 59,584 | ||||||
SGS SA | 19 | 22,472 | ||||||
82,056 | ||||||||
Computers & Peripherals (0.0%) | ||||||||
Logitech International SA* | 933 | 24,821 | ||||||
Construction Materials (0.2%) | ||||||||
Holcim Ltd. | 1,114 | 120,339 | ||||||
Diversified Telecommunication Services (0.1%) | ||||||||
SwissCom AG | 142 | 48,559 | ||||||
Electrical Equipment (0.3%) | ||||||||
ABB Ltd. | 10,431 | 235,254 | ||||||
Electronic Equipment & Instruments (0.0%) | ||||||||
Kudelski SA | 30 | 1,049 | ||||||
Food Products (1.1%) | ||||||||
Nestle SA | 2,085 | 792,439 | ||||||
Health Care Equipment & Supplies (0.1%) | ||||||||
Nobel Biocare Holding AG | 147 | 47,997 | ||||||
Phonak Holding AG | 171 | 15,332 | ||||||
Straumann Holding AG | 13 | 3,646 | ||||||
66,975 | ||||||||
Hotels, Restaurants & Leisure (0.0%) | ||||||||
Kuoni Reisen Holding | 4 | 2,406 | ||||||
Insurance (0.6%) | ||||||||
Swiss Life Holding | 156 | 41,139 | ||||||
Swiss Reinsurance | 1,923 | 175,421 | ||||||
Zurich Financial Services AG | 768 | 237,471 | ||||||
454,031 | ||||||||
Machinery (0.1%) | ||||||||
Schindler Holding AG | 130 | 8,638 | ||||||
Sulzer AG | 17 | 21,978 | ||||||
30,616 | ||||||||
Marine (0.0%) | ||||||||
Kuehne & Nagel International AG | 183 | 16,859 | ||||||
Common Stocks (continued) | ||||||||
Shares or | ||||||||
Principal Amount | Value | |||||||
SWITZERLAND (continued) | ||||||||
Pharmaceuticals (1.8%) | ||||||||
Novartis AG | 12,089 | $ | 678,850 | |||||
Roche Holding AG | 3,663 | 649,194 | ||||||
1,328,044 | ||||||||
Real Estate Management & Development (0.0%) | ||||||||
PSP Swiss Property AG* | 84 | 4,708 | ||||||
Semiconductors & Semiconductor Equipment (0.0%) | ||||||||
Unaxis Holding AG* | 39 | 20,673 | ||||||
Textiles, Apparel & Luxury Goods (0.3%) | ||||||||
Compagnie Finaciere Richemont AG | 2,783 | 166,384 | ||||||
Swatch Group AG | 118 | 6,676 | ||||||
Swatch Group AG, B Shares | 197 | 55,975 | ||||||
229,035 | ||||||||
4,722,609 | ||||||||
UNITED KINGDOM (21.9%) | ||||||||
Aerospace & Defense (0.4%) (a) | ||||||||
BAE Systems PLC | 16,531 | 133,384 | ||||||
Cobham PLC | 3,833 | 15,591 | ||||||
Meggitt PLC | 4,137 | 25,418 | ||||||
Rolls-Royce Group PLC | 9,717 | 104,617 | ||||||
279,010 | ||||||||
Airline (0.0%) (a) | ||||||||
British Airways PLC* | 3,545 | 29,647 | ||||||
Auto Components (0.0%) (a) | ||||||||
GKN PLC | 3,161 | 25,160 | ||||||
Beverages (0.6%) (a) | ||||||||
Diageo PLC | 13,540 | 281,400 | ||||||
SABMiller PLC | 4,146 | 104,959 | ||||||
Scottish & Newcastle PLC | 4,697 | 60,204 | ||||||
446,563 | ||||||||
Capital Markets (0.4%) (a) | ||||||||
3I Group PLC | 2,682 | 62,424 | ||||||
Amvescap PLC | 4,560 | 58,750 | ||||||
Close Brothers Group PLC | 212 | 3,642 | ||||||
ICAP PLC | 2,606 | 25,682 | ||||||
Investec PLC | 1,209 | 15,524 | ||||||
Man Group PLC | 9,663 | 117,528 | ||||||
Schroders PLC | 253 | 6,463 | ||||||
Tullett Prebon PLC | 453 | 4,047 | ||||||
294,060 | ||||||||
Chemicals (0.1%) (a) | ||||||||
Imperial Chemical Industries PLC | 5,183 | 64,467 | ||||||
Johnson Matthey PLC | 1,351 | 45,671 | ||||||
110,138 | ||||||||
Commercial Banks (3.8% ((a) | ||||||||
Barclays PLC | 33,416 | 464,867 | ||||||
HBOS PLC | 18,472 | 363,295 | ||||||
HSBC Holdings PLC | 57,667 | 1,055,805 | ||||||
Lloyds TSB Group PLC | 29,068 | 323,098 | ||||||
Royal Bank of Scotland Group PLC | 46,788 | 591,972 | ||||||
2,799,037 | ||||||||
Commercial Services & Supplies (0.3%) (a) | ||||||||
Aggreko PLC | 532 | 6,092 | ||||||
Biffa PLC | 1,945 | 10,540 | ||||||
Brambles Industries Ltd.* | 2,893 | 29,736 | ||||||
Capita Group PLC | 3,705 | 53,779 | ||||||
Davis Service Group PLC | 1,028 | 12,795 | ||||||
DE LA Rue PLC | 286 | 4,449 | ||||||
Group 4 Securicor PLC | 6,532 | 27,541 | ||||||
Hays PLC | 6,209 | 21,209 | ||||||
Intertek Group PLC | 349 | 6,848 | ||||||
Michael Page International PLC | 928 | 9,749 | ||||||
Rentokil Initial PLC | 10,285 | 33,007 | ||||||
Serco Group PLC | 1,504 | 13,557 | ||||||
229,302 | ||||||||
Construction & Engineering (0.1%) (a) | ||||||||
Amec PLC | 2,282 | 26,737 | ||||||
Balfour Beatty PLC | 1,233 | 10,873 | ||||||
37,610 | ||||||||
Construction Materials (0.1%) (a) | ||||||||
Hanson PLC | 3,443 | 74,273 | ||||||
Consumer Finance (0.0%) (a) | ||||||||
Cattles PLC | 1,790 | 14,018 | ||||||
Provident Financial PLC | 739 | 10,342 | ||||||
24,360 | ||||||||
Containers & Packaging (0.1%) (a) | ||||||||
Rexam PLC | 4,095 | 40,780 | ||||||
Distributor (0.0%) (a) | ||||||||
Inchcape PLC | 1,548 | 15,435 | ||||||
Diversified Financial Services (0.0%) (a) | ||||||||
London Stock Exchange Group PLC | 1,065 | 28,791 | ||||||
NVIT International Index Fund (Continued)
Common Stocks (continued) | ||||||||
Shares or | ||||||||
Principal Amount | Value | |||||||
UNITED KINGDOM (continued) | ||||||||
Diversified Telecommunication Services (0.5%) (a) | ||||||||
BT Group PLC | 42,062 | $ | 279,918 | |||||
Cable & Wireless PLC | 13,445 | 52,218 | ||||||
332,136 | ||||||||
Electric Power (0.1%) (a) | ||||||||
British Energy PLC | 5,821 | 62,790 | ||||||
Electric Utility (0.2%) (a) | ||||||||
Scottish & Southern Energy PLC | 4,030 | 116,835 | ||||||
Electronic Equipment & Instruments (0.0%) (a) | ||||||||
ElectroComponents PLC | 753 | 3,952 | ||||||
Food & Staples Retailing (0.6%) (a) | ||||||||
J Sainsbury PLC | 8,524 | 99,633 | ||||||
Tesco PLC | 38,916 | 325,566 | ||||||
425,199 | ||||||||
Food Products (0.5%) (a) | ||||||||
Cadbury Schweppes PLC | 11,147 | 151,277 | ||||||
Tate & Lyle PLC | 3,112 | 35,312 | ||||||
Unilever PLC | 6,308 | 203,664 | ||||||
390,253 | ||||||||
Health Care Equipment & Supplies (0.1%) (a) | ||||||||
Smith & Nephew PLC | 5,440 | 67,395 | ||||||
Hotels, Restaurants & Leisure (0.4%) | ||||||||
Carnival PLC (a) | 896 | 42,817 | ||||||
Compass Group PLC (a) | 8,959 | 61,856 | ||||||
First Choice Holidays PLC (a) | 3,656 | 23,219 | ||||||
Intercontinental Hotels Group PLC (a) | 1,778 | 44,165 | ||||||
Ladbrokes PLC (a) | 4,195 | 36,263 | ||||||
Mitchells & Butlers PLC (a) | 2,525 | 44,332 | ||||||
PartyCasinos & Gambling PLC (a) | 1,672 | 1,029 | ||||||
Punch Taverns PLC (a) | 1,580 | 38,759 | ||||||
Rank Group PLC | 3,141 | 11,747 | ||||||
William Hill PLC (a) | 1,669 | 20,481 | ||||||
324,668 | ||||||||
Household Durables (0.2%) (a) | ||||||||
Barratt Developments PLC | 1,876 | 37,183 | ||||||
Bellway PLC | 265 | 6,671 | ||||||
Berkeley Group Holdings PLC* | 204 | 7,241 | ||||||
Bovis Homes Group PLC | 747 | 13,329 | ||||||
George Wimpey PLC | 2,049 | 20,508 | ||||||
Persimmon PLC | 1,264 | 29,226 | ||||||
Taylor Woodrow PLC | 4,005 | 28,830 | ||||||
142,988 | ||||||||
Household Products (0.2%) (a) | ||||||||
Reckitt Benckiser PLC | 2,890 | 158,199 | ||||||
Independent Power Producers & Energy Traders (0.1%) (a) | ||||||||
International Power PLC | 7,043 | 60,533 | ||||||
Industrial Conglomerates (0.1%) (a) | ||||||||
Cookson Group PLC | 965 | 13,666 | ||||||
Smiths Group PLC | 2,313 | 54,849 | ||||||
Tomkins PLC | 5,164 | 26,821 | ||||||
95,336 | ||||||||
Insurance (1.0%) (a) | ||||||||
Aviva PLC | 12,321 | 182,884 | ||||||
Friends Provident PLC | 11,351 | 40,628 | ||||||
Legal & General Group PLC | 35,551 | 106,644 | ||||||
Old Mutual PLC | 24,046 | 81,021 | ||||||
Prudential PLC | 12,854 | 182,949 | ||||||
Resolution PLC | 4,033 | 50,465 | ||||||
Royal & Sun Alliance Insurance Group PLC | 13,173 | 38,320 | ||||||
Standard Life PLC | 9,305 | 61,410 | ||||||
744,321 | ||||||||
Internet & Catalog Retail (0.1%) (a) | ||||||||
Home Retail Group | 5,199 | 47,666 | ||||||
IT Services (0.0%) (a) | ||||||||
LogicaCMG PLC | 9,755 | 29,559 | ||||||
Machinery (0.1%) (a) | ||||||||
Charter PLC* | 418 | 9,223 | ||||||
FKI PLC | 5,500 | 13,856 | ||||||
IMI PLC | 1,017 | 12,045 | ||||||
Invensys PULC* | 2,918 | 22,223 | ||||||
57,347 | ||||||||
Media (0.8%) (a) | ||||||||
Aegis Group PLC | 1,273 | 3,489 | ||||||
British Sky Broadcasting PLC | 5,018 | 64,330 | ||||||
Daily Mail & General Trust | 954 | 14,587 | ||||||
Emap PLC | 1,614 | 26,484 | ||||||
EMI Group PLC | 5,195 | 27,830 | ||||||
ITV PLC | 19,459 | 44,406 | ||||||
Pearson PLC | 4,008 | 67,509 | ||||||
Reed Elsevier PLC | 7,053 | 91,143 | ||||||
Reuters Group PLC | 6,875 | 85,695 | ||||||
Trinity Mirror PLC | 1,456 | 15,348 | ||||||
United Business Media PLC | 813 | 12,866 | ||||||
WPP Group PLC | 6,500 | 97,207 | ||||||
Yell Group PLC | 4,816 | 44,482 | ||||||
595,376 | ||||||||
Metals & Mining (1.8%) (a) | ||||||||
Anglo American PLC | 7,319 | 429,669 |
Common Stocks (continued) | ||||||||
Shares or | ||||||||
Principal Amount | Value | |||||||
UNITED KINGDOM (continued) | ||||||||
Metals & Mining (continued) | ||||||||
BHP Billiton PLC | 12,082 | $ | 335,590 | |||||
Rio Tinto PLC | 4,969 | 380,109 | ||||||
Xstrata PLC | 2,935 | 174,712 | ||||||
1,320,080 | ||||||||
Multi-Utilities (0.5%) (a) | ||||||||
Centrica PLC | 17,236 | 133,898 | ||||||
National Grid PLC | 12,999 | 191,785 | ||||||
United Utilities PLC | 4,979 | 70,723 | ||||||
396,406 | ||||||||
Multiline Retail (0.4%) (a) | ||||||||
Enterprise Inns PLC | 3,387 | 46,664 | ||||||
Marks & Spencer Group PLC | 9,160 | 115,030 | ||||||
Next PLC | 1,342 | 53,872 | ||||||
Signet Group PLC | 4,801 | 10,015 | ||||||
Whitbread PLC | 932 | 32,958 | ||||||
258,539 | ||||||||
Oil, Gas & Consumable Fuels (3.8%) (a) | ||||||||
BG Group PLC | 17,657 | 289,415 | ||||||
BP PLC | 96,450 | 1,160,400 | ||||||
Royal Dutch Shell PLC | 13,633 | 568,248 | ||||||
Royal Dutch Shell PLC | 18,259 | 743,267 | ||||||
2,761,330 | ||||||||
Pharmaceuticals (1.6%) (a) | ||||||||
AstraZeneca PLC | 7,739 | 414,698 | ||||||
GlaxoSmithKline PLC | 28,536 | 743,288 | ||||||
1,157,986 | ||||||||
Real Estate Investment Trusts (REITs) (0.4%) (a) | ||||||||
British Land Co. PLC | 2,930 | 78,397 | ||||||
Brixton PLC | 464 | 4,062 | ||||||
Great Portland Estates PLC | 219 | 2,905 | ||||||
Hammerson PLC | 1,724 | 49,365 | ||||||
Land Securities Group PLC | 2,598 | 90,468 | ||||||
Liberty International PLC | 926 | 21,180 | ||||||
Slough Estates PLC | 3,020 | 37,665 | ||||||
284,042 | ||||||||
Road & Rail (0.1%) (a) | ||||||||
Arriva PLC | 1,139 | 15,641 | ||||||
FirstGroup PLC | 2,481 | 32,953 | ||||||
National Express Group PLC | 887 | 18,880 | ||||||
Stagecoach Group PLC | 2,216 | 8,069 | ||||||
75,543 | ||||||||
Semiconductors & Semiconductor Equipment (0.0%) (a) | ||||||||
ARM Holdings PLC | 5,645 | 16,512 | ||||||
CSR PLC* | 1,062 | 16,635 | ||||||
33,147 | ||||||||
Software (0.1%) (a) | ||||||||
Misys PLC | 2,787 | 13,051 | ||||||
Sage Group PLC | 8,295 | 38,859 | ||||||
51,910 | ||||||||
Specialty Retail (0.2%) (a) | ||||||||
Carphone Warehouse Group PLC | 2,644 | 17,378 | ||||||
DSG International PLC | 10,046 | 31,838 | ||||||
Kesa Electricals PLC | 2,899 | 18,189 | ||||||
Kingfisher PLC | 13,559 | 61,409 | ||||||
MFI Furniture Group PLC* | 342 | 931 | ||||||
129,745 | ||||||||
Textiles, Apparel & Luxury Goods (0.0%) (a) | ||||||||
Burberry Group PLC | 2,162 | 29,612 | ||||||
Tobacco (0.6%) (a) | ||||||||
British American Tobacco PLC | 7,501 | 255,799 | ||||||
Imperial Tobacco Group PLC | 3,599 | 165,919 | ||||||
421,718 | ||||||||
Trading Companies & Distributors (0.2%) (a) | ||||||||
Bunzl PLC | 1,414 | 19,573 | ||||||
Travis Perkins PLC | 378 | 14,346 | ||||||
Wolseley PLC | 3,642 | 87,398 | ||||||
121,317 | ||||||||
Transportation Infrastructure (0.0%) (a) | ||||||||
BBA Aviation PLC | 2,055 | 11,153 | ||||||
Water Utilities (0.1%) (a) | ||||||||
Kelda Group PLC | 1,881 | 35,447 | ||||||
Severn Trent Water PLC | 1,465 | 40,455 | ||||||
75,902 | ||||||||
Wireless Telecommunication Services (1.2%) (a) | ||||||||
Vodafone Group PLC | 262,511 | 879,537 | ||||||
16,096,686 | ||||||||
UNITED STATES (0.0%) (a) | ||||||||
Health Care Equipment & Supplies 0.0% | ||||||||
Synthes, Inc. | 233 | 27,941 | ||||||
Total Common Stocks (Cost $62,966,354) | 70,297,362 | |||||||
NVIT International Index Fund (Continued)
Repurchase Agreements (1.6%) | ||||||||
Shares or | ||||||||
Principal Amount | Value | |||||||
Nomura Securities, 5.20%, dated 06/29/07, due 07/02/07, repurchase price $1,203,483, collateralized by U.S. Government Agency Mortgages with a market value of $1,227,021 | $ | 1,202,962 | $ | 1,202,962 | ||||
Exchange Traded Fund (1.6%) | ||||||||
UNITED STATES (1.6%) | ||||||||
iShares MSCI EAFE Index Fund | 14,514 | 1,170,264 | ||||||
Rights (0.0%) | ||||||||
AUSTRALIA (0.0%) | ||||||||
Real Estate Investment Trust (REIT) (0.0%) | ||||||||
Westfield Group Rights | 6,972 | 257 | ||||||
SPAIN (0.0%) | ||||||||
Machinery (0.0%) | ||||||||
Zardoya Otis SA Bonus Rights | 302 | 1,156 | ||||||
Total Rights (Cost $0) | 1,413 | |||||||
JAPAN (0.0%) | ||||||||
Metals & Mining (0.0%) | ||||||||
Dowa Holdings Co. Ltd., expiring 01/29/10* | $ | 1,000 | 0 | |||||
Total Investments (Cost $65,329,195) (b) — 99.0% | 72,672,001 | |||||||
Other assets in excess of liabilities — (1.0%) | 723,392 | |||||||
NET ASSETS — 100.0% | $ | 73,395,393 | ||||||
* | Denotes a non-income producing security. | |
(a) | Fair Valued Security. | |
(b) | See notes to financial statements for tax unrealized appreciation (depreciation) of securities. |
At June 30, 2007, the Fund’s open forward foreign currency contracts against the United States Dollar were as follows:
Currency | Unrealized | |||||||||||||||||||
Delivery | Received/ | Contract | Market | Appreciation/ | ||||||||||||||||
Currency | Date | (Delivered) | Value | Value | (Depreciation) | |||||||||||||||
Short Contract: | ||||||||||||||||||||
British Sterling Pound | 08/10/07 | (41,000 | ) | $ | (81,883 | ) | $ | (82,277 | ) | $ | (394 | ) | ||||||||
Japanese Yen | 08/10/07 | (299,000 | ) | (2,438 | ) | (2,442 | ) | (4 | ) | |||||||||||
Total Short Contracts | $ | (84,321 | ) | $ | (84,719 | ) | $ | (398 | ) | |||||||||||
Long Contracts: | ||||||||||||||||||||
Australian Dollar | 08/10/07 | 13,300 | $ | 11,174 | $ | 11,260 | $ | 86 | ||||||||||||
Swiss Franc | 08/10/07 | 20,600 | 16,854 | 16,923 | 69 | |||||||||||||||
Euro | 08/10/07 | 207,200 | 281,063 | 280,805 | (258 | ) | ||||||||||||||
British Sterling Pound | 08/10/07 | 83,300 | 165,862 | 167,164 | 1,302 | |||||||||||||||
Japanese Yen | 08/10/07 | 18,382,700 | 153,999 | 150,149 | (3,850 | ) | ||||||||||||||
Swedish Krone | 08/10/07 | 26,200 | 3,872 | 3,840 | (32 | ) | ||||||||||||||
Total Long Contracts | $ | 632,824 | $ | 630,141 | $ | (2,683 | ) | |||||||||||||
At June 30, 2007, the Fund’s open futures contracts were as follows:
Market Value | Unrealized | |||||||||||||||
Number of | Long | Covered by | Appreciation | |||||||||||||
Contracts | Contracts | Expiration | Contracts | (Depreciation) | ||||||||||||
1 | S&P ASX 200 IDX | 09/21/07 | $ | 133,009 | $ | 116 | ||||||||||
9 | DJ Euro STOXX 50 | 09/30/07 | 549,917 | 9,093 | ||||||||||||
3 | FTSE 100 | 09/21/07 | 399,855 | 2,192 | ||||||||||||
2 | TOPIX INDX | 09/30/07 | 288,360 | (356 | ) | |||||||||||
3 | OMSX30 INDX | 07/27/07 | 55,079 | (1,716 | ) | |||||||||||
$ | 1,426,220 | $ | 9,329 | |||||||||||||
NVIT International | ||||||
Index Fund | ||||||
Assets: | ||||||
Investments, at value (cost $64,126,233) | $ | 71,469,039 | ||||
Repurchase agreements, at cost and value | 1,202,962 | |||||
Total Investments | 72,672,001 | |||||
Cash | 28,686 | |||||
Deposits with brokers for futures | 117,396 | |||||
Foreign currencies, at value (cost $679,717) | 684,188 | |||||
Interest and dividends receivable | 114,301 | |||||
Receivable for capital shares issued | 14,614 | |||||
Receivable for investments sold | 837 | |||||
Unrealized appreciation on futures contracts | 9,329 | |||||
Unrealized appreciation on forward foreign currency contracts | 1,964 | |||||
Reclaims receivable | 42,160 | |||||
Prepaid expenses | 635 | |||||
Total Assets | 73,686,111 | |||||
Liabilities: | ||||||
Payable for investments purchased | 213,423 | |||||
Unrealized depreciation on forward foreign currency contracts | 5,045 | |||||
Payable for capital shares redeemed | 91 | |||||
Accrued expenses and other payables: | ||||||
Investment advisory fees | 10,497 | |||||
Fund administration and transfer agent fees | 37,645 | |||||
Distribution fees | 4,989 | |||||
Administrative servicing fees | 4,720 | |||||
Compliance program costs | 630 | |||||
Other | 13,678 | |||||
Total Liabilities | 290,718 | |||||
Net Assets | $ | 73,395,393 | ||||
Represented by: | ||||||
Capital | $ | 65,156,198 | ||||
Accumulated net investment income | 337,408 | |||||
Accumulated net realized gains from investment transactions, futures and foreign currency transactions | 544,345 | |||||
Net unrealized appreciation on investments, futures and translation of assets and liabilities denominated in foreign currencies | 7,357,442 | |||||
Net Assets | $ | 73,395,393 | ||||
Net Assets: | ||||||
Class II Shares | $ | 14,558,694 | ||||
Class VI Shares | 941,338 | |||||
Class VII Shares | 1,204 | |||||
Class VIII Shares | 8,785,742 | |||||
Class ID Shares | 49,108,415 | |||||
Total | $ | 73,395,393 | ||||
30
NVIT International | |||||
Index Fund | |||||
Shares outstanding (unlimited number of shares authorized): | |||||
Class II Shares | 1,235,443 | ||||
Class VI Shares | 79,924 | ||||
Class VII Shares | 102 | ||||
Class VIII Shares | 746,426 | ||||
Class ID Shares | 4,161,224 | ||||
Total | 6,223,119 | ||||
Net asset value and offering price per share (Net assets by class divided by shares outstanding by class, respectively.): | |||||
Class II Shares | $ | 11.78 | |||
Class VI Shares | $ | 11.78 | |||
Class VII Shares | $ | 11.80 | |||
Class VIII Shares | $ | 11.77 | |||
Class ID Shares | $ | 11.80 | |||
31
NVIT International | ||||||
Index Fund | ||||||
INVESTMENT INCOME: | ||||||
Interest income | $ | 17,057 | ||||
Dividend income | 1,074,516 | |||||
Foreign tax withholding | (92,645 | ) | ||||
Total Income | 998,928 | |||||
Expenses: | ||||||
Investment advisory fees | 74,713 | |||||
Fund administration and transfer agent fees | 81,941 | |||||
Distribution fees Class II Shares | 2,722 | |||||
Distribution fees Class VI Shares | 832 | |||||
Distribution fees Class VII Shares | 2 | |||||
Distribution fees Class VIII Shares | 13,226 | |||||
Administrative servicing fees Class II Shares | 1,523 | |||||
Administrative servicing fees Class VI Shares | 452 | |||||
Administrative services fees Class VII Shares | 1 | |||||
Administrative services fees Class VIII Shares | 1,601 | |||||
Custodian fees | 1,811 | |||||
Trustee fees | 1,239 | |||||
Compliance program costs (Note 3) | 358 | |||||
Printing fees | 17,867 | |||||
Other | 2,186 | |||||
Total expenses before reimbursements and earnings credit | 200,474 | |||||
Earnings credit (Note 6) | (91 | ) | ||||
Expense reimbursements | (77,626 | ) | ||||
Net Expenses | 122,757 | |||||
Net Investment Income | 876,171 | |||||
REALIZED/ UNREALIZED GAINS (LOSSES) FROM INVESTMENTS: | ||||||
Net realized gains on investment transactions | 391,827 | |||||
Net realized gains on futures transactions | 121,577 | |||||
Net realized gains on foreign currency transactions | 33,307 | |||||
Net realized gains on investment transactions, futures and foreign currency transactions | 546,711 | |||||
Net change in unrealized appreciation on investments, futures and translation of assets and liabilities denominated in foreign currencies | 3,845,440 | |||||
Net realized/unrealized gains (losses) on investments, futures and translation of assets and liabilities denominated in foreign currencies | 4,392,151 | |||||
CHANGE IN NET ASSETS RESULTING FROM OPERATIONS | $ | 5,268,322 | ||||
32
NVIT International | |||||||||
Index Fund | |||||||||
Six Months Ended | Year Ended | ||||||||
June 30, | December 31, | ||||||||
2007 | 2006 (a) | ||||||||
(Unaudited) | |||||||||
FROM INVESTMENT ACTIVITIES: | |||||||||
Operations: | |||||||||
Net investment income | $ | 876,171 | $ | 605,869 | |||||
Net realized gains on investment transactions, futures and foreign currency transactions | 546,711 | 252,169 | |||||||
Net change in unrealized appreciation on investments, futures and translation of assets and liabilities denominated in foreign currencies | 3,845,440 | 3,512,002 | |||||||
Change in net assets resulting from operations | 5,268,322 | 4,370,040 | |||||||
Distributions to shareholders from: | |||||||||
Net investment income: | |||||||||
Class II | (69,475 | ) | (12 | ) | |||||
Class VI | (7,003 | ) | (2,922 | ) | |||||
Class VII | (10 | ) | (10 | ) | |||||
Class VIII | (60,745 | ) | (37,620 | ) | |||||
Class ID | (475,272 | ) | (572,439 | ) | |||||
Net realized gains: | |||||||||
Class II | (34,935 | ) | – | ||||||
Class VI | (2,261 | ) | – | ||||||
Class VII | (3 | ) | – | ||||||
Class VIII | (20,711 | ) | – | ||||||
Class ID | (116,261 | ) | – | ||||||
Change in net assets from shareholder distributions | (786,676 | ) | (613,003 | ) | |||||
Change in net assets from capital transactions | 19,618,136 | 45,538,574 | |||||||
Change in net assets | 24,099,782 | 49,295,611 | |||||||
Net Assets: | |||||||||
Beginning of period | 49,295,611 | – | |||||||
End of period | $ | 73,395,393 | $ | 49,295,611 | |||||
Accumulated net investment income at end of period | $ | 337,408 | $ | 73,742 | |||||
CAPITAL TRANSACTIONS: | |||||||||
Class II Shares | |||||||||
Proceeds from shares issued | $ | 14,546,163 | $ | 1,000 | |||||
Dividends reinvested | 104,410 | 12 | |||||||
Cost of shares redeemed (b) | (6,702 | ) | – | ||||||
14,643,871 | 1,012 | ||||||||
Class VI Shares | |||||||||
Proceeds from shares issued | 549,472 | 344,604 | |||||||
Dividends reinvested | 9,263 | 2,922 | |||||||
Cost of shares redeemed (b) | (22,550 | ) | (17,874 | ) | |||||
536,185 | 329,652 | ||||||||
33
NVIT International | |||||||||
Index Fund | |||||||||
Six Months Ended | Year Ended | ||||||||
June 30, | December 31, | ||||||||
2007 | 2006 (a) | ||||||||
(Unaudited) | |||||||||
CAPITAL TRANSACTIONS: (continued) | |||||||||
Class VII Shares | |||||||||
Proceeds from shares issued | $ | – | $ | 1,000 | |||||
Dividends reinvested | 12 | 10 | |||||||
12 | 1,010 | ||||||||
Class VIII Shares | |||||||||
Proceeds from shares issued | 4,396,948 | 4,931,805 | |||||||
Dividends reinvested | 81,456 | 37,620 | |||||||
Cost of shares redeemed (b) | (1,260,534 | ) | (337,365 | ) | |||||
3,217,870 | 4,632,060 | ||||||||
Class ID Shares | |||||||||
Proceeds from shares issued | 628,668 | 40,002,401 | |||||||
Dividends reinvested | 591,533 | 572,439 | |||||||
Cost of shares redeemed (b) | (3 | ) | – | ||||||
1,220,198 | 40,574,840 | ||||||||
Change in net assets from capital transactions | $ | 19,618,136 | $ | 45,538,574 | |||||
SHARE TRANSACTIONS: | |||||||||
Class II Shares | |||||||||
Issued | 1,226,957 | 100 | |||||||
Reinvested | 8,947 | 1 | |||||||
Redeemed | (562 | ) | – | ||||||
1,235,342 | 101 | ||||||||
Class VI Shares | |||||||||
Issued | 48,715 | 33,926 | |||||||
Reinvested | 804 | 279 | |||||||
Redeemed | (2,009 | ) | (1,791 | ) | |||||
47,510 | 32,414 | ||||||||
Class VII Shares | |||||||||
Issued | – | 100 | |||||||
Reinvested | 1 | 1 | |||||||
1 | 101 | ||||||||
Class VIII Shares | |||||||||
Issued | 385,677 | 496,578 | |||||||
Reinvested | 7,073 | 3,562 | |||||||
Redeemed | (112,085 | ) | (34,379 | ) | |||||
280,665 | 465,761 | ||||||||
Class ID Shares | |||||||||
Issued | 53,373 | 4,000,100 | |||||||
Reinvested | 51,357 | 56,394 | |||||||
Redeemed | — | (c) | — | ||||||
104,730 | 4,056,494 | ||||||||
Total change in shares | 1,668,248 | 4,554,871 | |||||||
(a) | For the period from May 1, 2006 (commencement of operations) through December 31, 2006. | |
(b) | Includes redemption fees, if any. | |
(c) | Amount is less than 1 share. |
34
Investment Activities | ||||||||||||||||
Net Realized | ||||||||||||||||
Net Asset | and | Total | ||||||||||||||
Value, | Net | Unrealized | from | |||||||||||||
Beginning | Investment | Gains on | Investment | |||||||||||||
of Period | Income | Investments | Activities | |||||||||||||
Class II Shares | ||||||||||||||||
Period ended December 31, 2006 (e) | $ | 10.00 | 0.12 | 0.82 | 0.94 | |||||||||||
For the six months ended June 30, 2007 (Unaudited) (f) | $ | 10.82 | 0.18 | 0.92 | 1.10 | |||||||||||
Class VI Shares | ||||||||||||||||
Period ended December 31, 2006 (e) | $ | 10.00 | 0.07 | 0.86 | 0.93 | |||||||||||
For the six months ended June 30, 2007 (Unaudited) (f) | $ | 10.81 | 0.18 | 0.92 | 1.10 | |||||||||||
Class VII Shares | ||||||||||||||||
Period ended December 31, 2006 (e) | $ | 10.00 | 0.10 | 0.82 | 0.92 | |||||||||||
For the six months ended June 30, 2007 (Unaudited) (f) | $ | 10.82 | 0.16 | 0.94 | 1.10 | |||||||||||
Class VIII Shares | ||||||||||||||||
Period ended December 31, 2006 (e) | $ | 10.00 | 0.07 | 0.85 | 0.92 | |||||||||||
For the six months ended June 30, 2007 (Unaudited) (f) | $ | 10.80 | 0.16 | 0.94 | 1.10 | |||||||||||
Class ID Shares | ||||||||||||||||
Period ended December 31, 2006 (e) | $ | 10.00 | 0.14 | 0.83 | 0.97 | |||||||||||
For the six months ended June 30, 2007 (Unaudited) (f) | $ | 10.83 | 0.18 | 0.94 | 1.12 | |||||||||||
[Additional columns below]
[Continued from above table, first column(s) repeated]
Distributions | ||||||||||||||||||||
Net | Net Asset | |||||||||||||||||||
Investment | Net realized | Total | Value, End | Total | ||||||||||||||||
Income | gains | Distributions | of Period | Return (a) | ||||||||||||||||
Class II Shares | ||||||||||||||||||||
Period ended December 31, 2006 (e) | (0.12 | ) | – | (0.12 | ) | $ | 10.82 | 9.57% | ||||||||||||
For the six months ended June 30, 2007 (Unaudited) (f) | (0.11 | ) | (0.03 | ) | (0.14 | ) | $ | 11.78 | 10.05% | |||||||||||
Class VI Shares | ||||||||||||||||||||
Period ended December 31, 2006 (e) | (0.12 | ) | – | (0.12 | ) | $ | 10.81 | 9.42% | ||||||||||||
For the six months ended June 30, 2007 (Unaudited) (f) | (0.10 | ) | (0.03 | ) | (0.13 | ) | $ | 11.78 | 10.23% | |||||||||||
Class VII Shares | ||||||||||||||||||||
Period ended December 31, 2006 (e) | (0.10 | ) | – | (0.10 | ) | $ | 10.82 | 9.26% | ||||||||||||
For the six months ended June 30, 2007 (Unaudited) (f) | (0.09 | ) | (0.03 | ) | (0.12 | ) | $ | 11.80 | 10.22% | |||||||||||
Class VIII Shares | ||||||||||||||||||||
Period ended December 31, 2006 (e) | (0.12 | ) | – | (0.12 | ) | $ | 10.80 | 9.30% | ||||||||||||
For the six months ended June 30, 2007 (Unaudited) (f) | (0.10 | ) | (0.03 | ) | (0.13 | ) | $ | 11.77 | 10.16% | |||||||||||
Class ID Shares | ||||||||||||||||||||
Period ended December 31, 2006 (e) | (0.14 | ) | – | (0.14 | ) | $ | 10.83 | 9.83% | ||||||||||||
For the six months ended June 30, 2007 (Unaudited) (f) | (0.12 | ) | (0.03 | ) | (0.15 | ) | $ | 11.80 | 10.34% | |||||||||||
[Additional columns below]
[Continued from above table, first column(s) repeated]
Ratios / Supplemental Data | ||||||||||||||||||||||||||
Ratio of | Ratio of Net | |||||||||||||||||||||||||
Ratio of Net | Expenses | Investment | ||||||||||||||||||||||||
Net Assets | Ratio of | Investment | (Prior to | Income (Prior to | ||||||||||||||||||||||
at End of | Expenses | Income | Reimbursements) | Reimbursements) | ||||||||||||||||||||||
Period | to Average | to Average | to Average | to Average | Portfolio | |||||||||||||||||||||
(000s) | Net Assets (b) | Net Assets (b) | Net Assets (b) (c) | Net Assets (b) (c) | Turnover (d) | |||||||||||||||||||||
Class II Shares | ||||||||||||||||||||||||||
Period ended December 31, 2006 (e) | $ | 1 | 0.76% | 1.83% | 1.29% | 1.30% | 10.94% | |||||||||||||||||||
For the six months ended June 30, 2007 (Unaudited) (f) | $ | 14,559 | 0.76% | 3.10% | 0.84% | 3.10% | 13.34% | |||||||||||||||||||
Class VI Shares | ||||||||||||||||||||||||||
Period ended December 31, 2006 (e) | $ | 350 | 0.76% | 1.25% | 1.13% | 0.88% | 10.94% | |||||||||||||||||||
For the six months ended June 30, 2007 (Unaudited) (f) | $ | 941 | 0.76% | 3.20% | 0.98% | 3.20% | 13.34% | |||||||||||||||||||
Class VII Shares | ||||||||||||||||||||||||||
Period ended December 31, 2006 (e) | $ | 1 | 0.97% | 1.57% | 1.50% | 1.04% | 10.94% | |||||||||||||||||||
For the six months ended June 30, 2007 (Unaudited) (f) | $ | 1 | 0.75% | 2.81% | 1.02% | 2.81% | 13.34% | |||||||||||||||||||
Class VIII Shares | ||||||||||||||||||||||||||
Period ended December 31, 2006 (e) | $ | 5,031 | 0.88% | 0.98% | 1.35% | 0.51% | 10.94% | |||||||||||||||||||
For the six months ended June 30, 2007 (Unaudited) (f) | $ | 8,786 | 0.82% | 2.90% | 1.10% | 2.90% | 13.34% | |||||||||||||||||||
Class ID Shares | ||||||||||||||||||||||||||
Period ended December 31, 2006 (e) | $ | 43,912 | 0.37% | 2.21% | 0.62% | 1.96% | 10.94% | |||||||||||||||||||
For the six months ended June 30, 2007 (Unaudited) (f) | $ | 49,108 | 0.37% | 3.21% | 0.66% | 3.21% | 13.34% | |||||||||||||||||||
(a) | Not annualized for periods less than one year. | |
(b) | Annualized for periods less than one year. | |
(c) | During the period, certain fees were waived and/or reimbursed. If such waivers/reimbursements had not occurred, the ratios would have been as indicated. | |
(d) | Portfolio turnover is calculated on the basis of the Fund as a whole without distinguishing among the classes of shares. | |
(e) | For the period from May 1, 2006 (commencement of operations) through December 31, 2006. | |
(f) | Net investment income (loss) is based on average shares outstanding during the period. |
See notes to financial statements.
35
1. Organization
Nationwide Variable Insurance Trust (“NVIT” or the “Trust”) is an open-end management investment company, organized under the laws of Delaware by an amended and restated Agreement and Declaration of Trust, dated October 28, 2004, as amended to date. Prior to May 1, 2007, the Trust was named “Gartmore Variable Insurance Trust”. The Trust, originally created under the laws of Massachusetts as a Massachusetts business trust pursuant to a Declaration of Trust dated, as of June 30, 1981, and as subsequently amended, redomesticated as a Delaware Statutory Trust after the close of trading on April 29, 2005, and is registered under the Investment Company Act of 1940, as amended (the “1940 Act”). The redomestication was a change in statutory status and did not affect the operations of the Trust. As of June 30, 2007, the Trust had authorized an unlimited number of shares of beneficial interest, without par value (“shares”). The Trust currently offers shares to life insurance company separate accounts to fund the benefits under variable life insurance or annuity policies. To date, only the separate accounts of Nationwide Life Insurance Company and Nationwide Life and Annuity Insurance Company (collectively, “Nationwide”) have purchased shares of the NVIT International Index Fund (the “Fund”), (formerly, “GVIT International Index Fund”). The Trust currently operates forty (40) separate series, or mutual funds, each with its own investment objectives and strategies. This report contains the financial statements and financial highlights of the Fund.
2. Summary of Significant Accounting Policies
The following is a summary of significant accounting policies followed by the Fund in the preparation of its financial statements. The policies are in conformity with accounting principles generally accepted in the United States of America (“GAAP”). The preparation of financial statements requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of income and expenses for the period. Actual results could differ from those estimates.
(a) | Security Valuation |
Securities for which market quotations are readily available are valued at current market value as of “Valuation Time.” Valuation Time is as of the close of regular trading on the New York Stock Exchange (usually 4 p.m. Eastern time). Equity securities are valued at the last quoted sale price or, if there is no sale price, the last quoted bid price provided by an independent pricing service approved by the Trust’s Board of Trustees (“Board of Trustees”). Securities traded on NASDAQ are valued at the NASDAQ official closing price. Prices are taken from the primary market or exchange in which each security trades. Investment companies are valued at net asset value as reported by such company. | |
Most securities listed on a foreign exchange are valued either at fair value (see description below) or at the last sale price at the close of the exchange on which the security is principally traded. Foreign securities, currencies, and other assets and liabilities denominated in foreign currencies are translated into U.S. dollars at the exchange rate of said currencies against the U.S. dollar, as of Valuation Time, as provided by an independent pricing service approved by the Board of Trustees. | |
Securities for which market quotations are not readily available, or for which an independent pricing service does not provide a value or provides a value that does not represent fair value in the judgment of the Fund’s investment adviser or designee, are valued at fair value under procedures approved by the Board of Trustees. The “Fair Value” of these securities is determined in good faith by taking into account relevant factors and surrounding circumstances. Methods utilized to obtain a “Fair Value” may include the following non-exclusive list of acceptable methods: (i) a multiple of earnings; (ii) the discount from market value of a similar, freely traded security; (iii) the yield-to-maturity for debt issues; or (iv) a consolidation of the methods. The Trust’s Valuation & Operations Committee considers a non-exclusive list of factors to arrive at the appropriate method of determining “Fair Value.” For example, fair value determinations are required for securities whose value is affected by a “significant” event that materially affects the value of a domestic or foreign security which occurs subsequent to the time of the close of the principal market on which such domestic or foreign security trades and before the Valuation Time (i.e., a “subsequent event”). Typically, |
this will involve events occurring after the close of a foreign market on which a security trades and before the next Valuation Time. | |
The Fund values foreign securities at fair value in the circumstances described below. Generally, trading in foreign securities markets is completed each day at various times prior to the Valuation Time. Due to the time differences between the closings of the relevant foreign securities exchanges and the Valuation Time for the Fund, the Fund will fair value its foreign investments when it is determined that the market quotations for the foreign investments either are not readily available or are unreliable and, therefore, do not represent fair value. When the fair value prices are utilized, these prices will attempt to reflect the impact of the U.S. financial markets’ perceptions and trading activities on the Fund’s foreign investments since the last closing prices of the foreign investments were calculated on their primary foreign securities markets or exchanges. For these purposes, the Board of Trustees has determined that movements in relevant indices or other appropriate market indicators, after the close of the foreign securities exchanges, may demonstrate that market quotations are unreliable, and may trigger fair value pricing for certain securities. Consequently, fair valuation of portfolio securities may occur on a daily basis. |
(b) | Repurchase Agreements |
The Fund may enter into repurchase agreements with an entity which is a member of the Federal Reserve System or which is a “primary dealer” (as designated by the Federal Reserve Bank of New York) in U.S. Government obligations. The repurchase price generally equals the price paid by the Fund plus interest negotiated on the basis of current short-term rates, which may be more or less than the rate on the underlying portfolio securities. The seller under a repurchase agreement is required to maintain the value of the collateral held pursuant to the agreement at a market value equal to or greater than the repurchase price (including accrued interest). Collateral subject to repurchase agreements is held by the Fund’s custodian or another qualified sub-custodian or in the Federal Reserve/ Treasury book-entry system. If the counterparty defaults and the fair value of the collateral declines, realization of the collateral by the Fund may be delayed or limited. The Fund may transfer uninvested cash balances into a pooled cash account. These balances are invested in one or more repurchase agreements, with the counterparty of Nomura Securities, which is fully collateralized by U.S. Government Agency Mortgages. |
(c) | Foreign Currency Transactions |
The accounting records of the Fund are maintained in U.S. dollars. Foreign currency amounts are translated into U.S. dollars at the current rate of exchange to determine the value of investments, assets and liabilities. The Fund may enter into foreign currency contracts in connection with purchases or sales of securities denominated in a foreign currency. Purchases and sales of securities, and income and expenses, are translated at the prevailing rate of exchange on the respective date of these transactions. The Fund does not isolate that portion of the results of operations resulting from changes in foreign exchange rates on investments from fluctuations arising from changes in market prices of securities held. These fluctuations are included with the net realized and unrealized gain or loss from investments and foreign currencies. |
(d) | Forward Foreign Currency Contracts |
The Fund may enter into forward foreign currency contracts in connection with planned purchases or sales of securities or to hedge the U.S. dollar value of portfolio securities denominated in a particular currency. The Fund could be exposed to risks if the counterparties to the contracts are unable to meet the terms of their contracts and from unanticipated movements in the value of a foreign currency relative to the U.S. dollar. Forward foreign currency contracts are valued at the current cost of covering these contracts, as provided by an independent pricing service approved by the Board of Trustees. The forward foreign currency contracts are adjusted by the daily exchange rate of the underlying currency and any gains or losses are recorded for financial statement purposes as unrealized gains or losses until the contract settlement date. |
(e) | Futures Contracts |
The Fund may invest in financial futures contracts (“futures contracts”) for the purpose of hedging its existing portfolio securities or securities that the Fund intends to purchase against fluctuations in value caused by changes in prevailing market interest rates or prices. Futures contracts may also be entered into for non-hedging purposes. | |
Upon entering into a futures contract, the Fund is required to pledge to the broker an amount of cash and/or other assets equal to a certain percentage of the contract amount (initial margin deposit). Subsequent payments, known as “variation margin,” are made each day, depending on the daily fluctuations in the fair value/market value of the underlying assets. A gain or loss equal to the daily variation margin is recognized on a daily basis. Futures contracts are valued daily at their last quoted sale price. | |
A “sale” of a futures contract means the creation of a contractual obligation to deliver the securities or foreign currency called for by the contract at a fixed price at a specified time in the future. A “purchase” of a futures contract means the creation of a contractual obligation to acquire the securities or foreign currency at a fixed price at a specified time in the future. | |
Should market conditions change unexpectedly, the Fund may not achieve the anticipated benefits of the futures contracts and may realize a loss. The use of futures transactions for hedging purposes involves the risk of imperfect correlation in movements in the price of futures contracts, interest rates, and the value of the underlying hedged assets. |
(f) | Written Options Contracts |
The Fund may write options contracts. A written option obligates the Fund to deliver (written call) or to receive (written put) a specified quantity of an underlying asset at the contract amount upon exercise by the holder of the option. When the Fund writes an option, an amount equal to the premium received by the Fund is recorded as a liability and is subsequently adjusted to the current fair value of the option written. Premiums received from writing options that expire unexercised are treated by the Fund on the expiration date as realized gains from investments. The difference between the premium and the amount paid on effecting a closing purchase transaction, as a realized loss. If a call option is exercised, the premium is added to the proceeds from the sale of the underlying security or currency in determining whether the Fund has realized a gain or loss. If a put option is exercised, the premium reduces the cost basis of the securities purchased by the Fund. Options traded on an exchange are valued at the last quoted sale price, or in the absence of a sale, the bid price provided by an independent pricing service approved by the Board of Trustees. Non-exchange traded options are valued using dealer supplied quotes. The Fund as a writer of an option bears the market risk of an unfavorable change in the price of the security underlying the written option. |
(g) | Security Transactions and Investment Income |
Security transactions are accounted for on the date the security is purchased or sold (“trade date”). Securities gains and losses are calculated on the identified cost basis. Interest income is recognized on the accrual basis and includes, where applicable, the amortization or accretion of premium or discount. Dividend income is recorded on the ex-dividend date. |
(h) | Securities Lending |
To generate additional income, the Fund may lend its portfolio securities, up to 33 1/3% of the Fund, to brokers, dealers and other financial institutions provided that (1) the borrower delivers cash or securities as collateral with respect to each new loan of U.S. securities, equal to at least 102% of the value of the portfolio securities loaned, and with respect to each new loan on non-U.S. securities, collateral of at least 105% of the value of the portfolio securities loaned; and (2) at all times thereafter shall require the borrower to mark-to-market the collateral on a daily basis so that the market value of such collateral does not fall below 100% of the value of securities loaned. The Fund receives payments from borrowers equivalent to the dividends and interest that would have been earned on securities loaned while simultaneously seeking to earn income on the investment of cash collateral. There may be risks of delay |
in recovery of the securities should the borrower of the securities fail financially. Loans will be made, however, only to borrowers deemed by the Fund’s investment adviser to be of good standing and creditworthy under guidelines established by the Board of Trustees and when, in judgment of the adviser, the consideration which can be earned currently from these securities loans justifies the attendant risks. Loans are subject to termination by the Fund or the borrower at any time, and, therefore, are not considered to be illiquid investments. JP Morgan Chase Bank serves as custodian for the securities lending program of the Fund. JP Morgan Chase Bank receives a fee based on the value of the collateral received from borrowers. As of June 30, 2007, the Fund did not have securities on loan. |
(i) | Distributions to Shareholders |
The Fund’s dividends from net investment income, if any, are declared and paid quarterly. The Fund’s distributions from net realized capital gains, if any, are declared and distributed at least annually. | |
Dividends and distributions to shareholders are determined in accordance with federal income tax regulations, which may differ from GAAP. These “book/tax” differences are considered either permanent or temporary in nature. In accordance with the American Institute of Certified Public Accountants Statement of Position 93-2, permanent differences (i.e., reclassification of market discounts, foreign exchange gain/loss, paydowns, and distributions from real estate investment trusts) are reclassified within the capital accounts based on their nature for federal income tax purposes; temporary differences do not require reclassification. These reclassifications have no effect upon the net asset value of the Fund. To the extent distributions exceed current and accumulated earnings and profits for federal income tax purposes, these distributions are reported as distributions of paid-in-capital. |
(j) | Federal Income Taxes |
It is the policy of the Fund to qualify or to continue to qualify as a “regulated investment company” by complying with the provisions available to certain investment companies, as defined in Subchapter M of the U.S. Internal Revenue Code, and to make distributions of net investment income and net realized capital gains sufficient to relieve the Fund from all, or substantially all, federal income taxes. | |
As of June 30, 2007, the tax cost of securities and the breakdown of unrealized appreciation (depreciation) for the Fund was as follows: |
Net | ||||||||||||||
Unrealized | ||||||||||||||
Tax Cost of | Unrealized | Unrealized | Appreciation | |||||||||||
Securities | Appreciation | Depreciation | (Depreciation) | |||||||||||
$ | 65,394,762 | $ | 8,683,805 | $ | (1,406,566 | ) | $ | 7,277,239 | ||||||
(k) | Allocation of Expenses, Income, and Gains and Losses |
Expenses directly attributable to the Fund are charged to the Fund. Expenses not directly attributable to the Fund are allocated proportionately among various or all funds within the Trust. The method used by the Fund for allocating income, fund level expenses, and realized and unrealized gains or losses is based on the fair value of shares outstanding relative to net assets. Under this method, each class of shares participates based on the total net asset value of that class’s shares in proportion to the total net assets of the Fund. Expenses specific to a class (such as Rule 12b-1 and administrative services fees) are charged to that class. |
3. Transactions with Affiliates
Under the terms of the Trust’s Investment Advisory Agreement, Nationwide Fund Advisors (formerly, Gartmore Mutual Fund Capital Trust (“GMF”)) (“NFA” or the “Advisor”) manages the investment of the assets and supervises the daily business affairs of the Fund. NFA is a wholly-owned subsidiary of Nationwide Financial Services (“NFS”). In addition, NFA provides investment management evaluation services in initially selecting and monitoring, on an ongoing basis, the
Under the terms of the Investment Advisory Agreement, the Fund pays the Fund’s adviser an investment advisory fee based on the Fund’s average daily net assets. Additional information regarding investment advisory fees and subadvisory fees for NFA and the subadviser is as follows for the six months ended June 30, 2007:
Total | ||||||
Fee Schedule | Fees | |||||
$0 up to $1.5 billion | 0.27% | |||||
$1.5 billion up to $3 billion | 0.26% | |||||
$3 billion or more | 0.25% | |||||
From such fees, pursuant to the subadvisory agreement, NFA paid the subadviser $30,438 for the six months ended June 30, 2007.
NFA and the Fund have entered into a written contract (“Expense Limitation Agreement”) that limits operating expenses (excluding any taxes, interest, brokerage fees, Rule 12b-1 fees, short sale dividend expenses, administrative services fees, other expenses which are capitalized in accordance with generally accepted accounting principles and may exclude other non-routine expenses not incurred in the ordinary course of the Fund’s business) from exceeding 0.37% until at least May 1, 2008.
NFA may request and receive reimbursement from the Fund of the advisory fees waived and other expenses reimbursed by NFA, respectively, pursuant to the Expense Limitation Agreement at a later date not to exceed three years from the fiscal year in which the corresponding reimbursement to the Fund was made, (as described below), if the Fund has reached a sufficient asset size to permit reimbursement to be made without causing the total annual operating expense ratio of the Fund to exceed the limits set forth above. No reimbursement will be made unless: (i) the Fund’s assets exceed $100 million; (ii) the total annual expense ratio of the Class making such reimbursement is less than the limit set forth above; and (iii) the payment of such reimbursement is approved by the Board of Trustees on a quarterly basis. Except as provided for in the Expense Limitation Agreement, reimbursement of amounts previously waived or assumed by NFA is not permitted.
For the six months ended June 30, 2007, the cumulative potential reimbursements for all classes of the Fund, based on reimbursements which expire within three years from the fiscal year in which the corresponding reimbursement to the Fund was made for expenses reimbursed by NFA, would be:
Six months ended | Six months ended | |||||||||
December 31, 2006 | June 30, 2007 | |||||||||
$ | 73,132 | $ | 77,626 |
Under the terms of a Fund Administration and Transfer Agency Agreement, Nationwide Fund Management, LLC (formerly, Gartmore Investor Services, Inc. (“GISI”)) (“NFM”), a wholly-owned subsidiary of NFS Distributors, Inc. (“NFSDI”), provides the Fund with various administrative and accounting services for the Fund (prior to May 1, 2007, this service was provided by Gartmore SA Capital Trust (“GSA”)), and serves as Transfer and Dividend Disbursing Agent for the Fund (prior to May 1, 2007, this service was provided by GISI, an indirect subsidiary of GSA). The fees for the services provided under this Agreement are calculated based on the Trust’s average daily net assets according to the fee
Combined Fee Schedule* | ||||||
Up to $1 billion | 0.15% | |||||
$1 billion up to $3 billion | 0.10% | |||||
$3 billion up to $8 billion | 0.05% | |||||
$8 billion up to $10 billion | 0.04% | |||||
$10 billion up to $12 billion | 0.02% | |||||
$12 billion or more | 0.01% | |||||
* | The assets of the Nationwide NVIT Investor Destinations Aggressive Fund, the Nationwide NVIT Investor Destinations Moderately Aggressive Fund, the Nationwide NVIT Investor Destinations Moderate Fund, the Nationwide NVIT Investor Destinations Moderately Conservative Fund, and the Nationwide NVIT Investor Destinations Conservative Fund (collectively, the “Investor Destinations Funds”) are excluded from the Trust asset level amount in order to calculate this asset-based fee. The Investor Destinations Funds do not pay any part of this fee. |
NFA and NFM have entered into agreements with Citi Fund Services Ohio, Inc. (“Citi”), pursuant to which Citi provides sub-administration and sub-transfer agency services, respectively, to the Fund. Effective August 1, 2007, The BISYS Group Inc. was acquired by and became a wholly owned subsidiary of Citi.
Under the terms of a Distribution Plan under Rule 12b-1 of the 1940 Act, Nationwide Fund Distributors, LLC. (formerly, “Gartmore Distribution Services, Inc. (“GDSI”)) (“NFD” or “Distributor”), the Fund’s principal underwriter, is compensated by the Fund for expenses associated with the distribution of the Class II, Class VI, Class VII and Class VIII shares of the Fund. NFD is a wholly-owned subsidiary of NFSDI. These fees are based on average daily net assets of Class II, Class VI, Class VII, and Class VIII shares of the Fund at an annual rate not to exceed 0.25% for Class II and Class VI shares and 0.40% for Class VII and Class VIII shares.
Under the terms of an Administrative Services Plan, the Fund may pay fees to servicing organizations, such as broker-dealers, including NFS, and financial institutions, which agree to provide administrative support services to the shareholders of certain classes. These services include, but are not limited, to the following: establishing and maintaining shareholder accounts; processing purchase and redemption transactions; arranging bank wires; performing shareholder sub-accounting; answering inquires regarding the Fund; and other such services. These fees are based on an annual rate of up to 0.25% of the average daily net assets of Class II, Class VI, Class VII and Class VIII shares of the Fund.
For the six months ended June 30, 2007, NFS received $1,854 in Administrative Services Fees from the Fund.
Under the terms of a letter agreement dated September 12, 2006, by and among NFA, the Audit Committee of the Trust and the Trust, the Trust has agreed to reimburse NFA certain costs related to the Fund’s portion of ongoing administration, monitoring and annual (audit) testing of the Trust’s Rule 38a-1 Compliance Program subject to the pre-approval of the Trust’s Audit Committee. For the six months ended June 30, 2007, the Fund’s portion of such costs amounted to $358.
4. Short-Term Trading Fees
The Fund reserves the right to assess a short-term trading fee on certain transactions out of Class VI and Class VIII shares that a separate account makes on behalf of a variable insurance contract owner (the “contract owner”). A separate account that redeems Class VI and Class VIII shares on behalf of a contract owner may be subject to a 1.00% short-term trading fee if the separate account held the Class VI and Class VIII shares on behalf of the contract owner for 60 days or less, unless an exception applies as disclosed in the Fund’s prospectus. The short-term trading fee is paid directly to the Fund and is intended to offset the cost to the Fund of excess brokerage commissions and other costs associated with fluctuations in Fund asset levels and cash flow caused by short-term trading. For purposes of determining whether the
For the six months ended June 30, 2007, the Fund had contributions to capital due to collection of redemption fees in the amount of $2,463.
5. Investment Transactions
For the six months ended June 30, 2007, (excluding short-term securities) the Fund had purchases of $28,274,370 and sales of $9,002,610.
6. Bank Loans and Earnings Credit
The Trust has a credit agreement with JPMorgan Chase & Co., the Fund’s custodian bank, permitting the Trust to borrow up to $100,000,000. Borrowings under this arrangement bear interest at the Federal Funds rate plus 0.50%. The interest costs, if any, would be included in other fees in the Statement of Operations. No compensating balances were required under the terms of the line of credit. The line of credit is renewed annually, expiring on June 25, 2008, with a commitment fee of 0.07% per year on $100,000,000. There were no borrowings outstanding under this line of credit for the six months ended June 30, 2007.
The Trust’s custodian bank has agreed to reduce the bank’s fees (earnings credit) when the Funds of the Trust maintain cash on deposit in non-interest-bearing custody and Demand Deposit Accounts. Earnings credits, if any, are shown as a reduction of total expenses on the Statement of Operations.
7. Portfolio Investment Risks
Risks Associated with Foreign Securities and Currencies. Investments in securities of foreign issuers carry certain risks not ordinarily associated with investments in securities of U.S. issuers. These risks include future political and economic developments, and the possible imposition of exchange controls or other foreign governmental laws and restrictions. In addition, with respect to certain countries, there is the possibility of expropriation of assets, confiscatory taxation, political or social instability, or diplomatic developments, which could adversely affect investments in those countries.
Certain countries also may impose substantial restrictions on investments in their capital markets by foreign entities, including restrictions on investments in issuers of industries deemed sensitive to relevant national interests. These factors may limit the investment opportunities available and result in a lack of liquidity and high price volatility with respect to securities of issuers from developing countries.
8. Indemnifications
Under the Trust’s organizational documents, certain of the Trust’s Officers and Trustees are indemnified against certain liabilities arising out of the performance of their duties to the Trust. In addition, the Trust has entered into Indemnification Agreements with the Trust’s trustees and certain officers covering similar liabilities. Trust Officers receive no compensation from the Trust for serving as the Trust’s Officers. In addition, in the normal course of business, the Trust enters into contracts with its vendors and others that provide for general indemnifications. The Trust’s maximum exposure under these arrangements is unknown, as this would involve future claims that may be made against the Trust. Based on experience, however, the Trust expects that risk of loss to be remote.
9. Recently Issued Accounting Pronouncements
On July 13, 2006, the Financial Accounting Standards Board (“FASB”) released FASB Interpretation No. 48, Accounting for Uncertainty in Income Taxes (“FIN 48”). FIN 48 provides guidance for how uncertain tax positions should be recognized, measured, presented and disclosed in the financial statements. FIN 48 requires the affirmative evaluation of tax positions taken or expected to be taken in the course of preparing the Fund’s tax returns to determine whether it is more-likely-than-not (i.e., greater than 50 percent) that each tax position will be sustained upon examination by a taxing
In September 2006, the FASB issued Statement on Financial Accounting Standards (“SFAS”) No. 157, “Fair Value Measurements.” This standard establishes a single authoritative definition of fair value, sets out a framework for measuring fair value and requires additional disclosures about fair value measurements. SFAS No. 157 applies to fair value measurements already required or permitted by existing standards. SFAS No. 157 is effective for financial statements issued for fiscal years beginning after November 15, 2007 and interim periods within those fiscal years. The changes to current accounting principles generally accepted in the United States of America from the application of this Statement relate to the definition of fair value, the methods used to measure fair value, and the expanded disclosures about fair value measurements. As of June 30, 2007, the Fund does not believe the adoption of SFAS No. 157 will impact the financial statement amounts; however, additional disclosures may be required about the inputs used to develop the measurements and the effect of certain of the measurements on changes in net assets for the period.
Trustees who are not Interested Persons (as defined in the 1940 Act) and Officers of the Trust as of June 30, 2007
Number of | ||||||||||
Position(s) Held | Portfolios in the | |||||||||
with the Trust | Principal Occupation(s) | Nationwide Fund | Other | |||||||
Name, Address | and Length of | During Past | Complex Overseen | Directorships | ||||||
and Year of Birth | Time Served1 | Five Years | by Trustee | Held by Trustee2 | ||||||
Charles E. Allen c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1948 | Trustee since July 2000 | Mr. Allen is Chairman, Chief Executive Officer and President of Graimark Realty Advisors, Inc. (real estate development, investment and asset management). | 89 | None | ||||||
Paula H.J. Cholmondeley c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1947 | Trustee since July 2000 | Ms. Cholmondeley was Vice President and General Manager of Sappi Fine Paper North America from April 2000 through December 2003. | 89 | Director of Dentsply International, Inc.(dental products), Ultralife Batteries, Inc., Terex Corporation (construction equipment), Minerals Technology, Inc. (specialty chemicals) and Albany International Corp. (paper industry) | ||||||
C. Brent DeVore3 c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1940 | Trustee since 1990 | Dr. DeVore is President of Otterbein College. | 89 | None | ||||||
Phyllis Kay Dryden c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1947 | Trustee since December 2004 | Ms. Dryden was a partner of Mitchell Madison, a management consulting company from January 2006 until December 2006; she is currently a consultant with the company. Ms. Dryden was formerly Managing Partner of marchFIRST, a global management consulting firm. | 89 | None | ||||||
Barbara L. Hennigar c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1935 | Trustee since July 2000 | Retired. | 89 | None |
Number of | ||||||||||
Position(s) Held | Portfolios in the | |||||||||
with the Trust | Principal Occupation(s) | Nationwide Fund | Other | |||||||
Name, Address | and Length of | During Past | Complex Overseen | Directorships | ||||||
and Year of Birth | Time Served1 | Five Years | by Trustee | Held by Trustee2 | ||||||
Barbara I. Jacobs c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1950 | Trustee since December 2004 | Ms. Jacobs served as Chairman of the Board of Directors of KICAP Network Fund, a European (United Kingdom) hedge fund, from January 2001 through January 2006. From 1998-2003, Ms. Jacobs was also a Managing Director and European Portfolio Manager of CREF Investments (Teachers Insurance and Annuity Association — College Retirement Equities Fund). | 89 | None | ||||||
Douglas F. Kridler c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1955 | Trustee since September 1997 | Mr. Kridler has served as the President and Chief Executive Officer of the Columbus Foundation (a Columbus, OH-based foundation which manages over 1,300 individual endowment funds) since February 2002. Prior to January 31, 2002, Mr. Kridler was the President of the Columbus Association for the Performing Arts and Chairman of the Greater Columbus Convention and Visitors Bureau. | 89 | None | ||||||
Michael D. McCarthy c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1947 | Trustee since December 2004 | Retired. Mr. McCarthy was Chairman of VMAC (commodity swaps) from October 2002 until January 2007; and a partner of Pineville Properties LLC (a commercial real estate development firm) from September 2000 until January 2007. | 89 | None | ||||||
David C. Wetmore c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1948 | Trustee since 1995 and Chairman since February 2005 | Retired. | 89 | None | ||||||
1 | Length of time served includes time served with the Trust’s predecessors. | |
2 | Directorships held in (1) any other investment companies registered under the 1940 Act, (2) any company with a class of securities registered pursuant to Section 12 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or (3) any company subject to the requirements of Section 15(d) of the Exchange Act. | |
3 | Mr. DeVore has served as President of Otterbein College since 1984. Mark Thresher, President and Chief Operating Officer of Nationwide Financial Services, Inc. (“NFS”) has served as a member of the Board of Trustees of Otterbein College since 2000, currently serves as one of 30 of its trustees, and is currently one of two Vice Chairmen of the Board. Each of Nationwide Fund Advisors (“NFA”), the Funds’ investment adviser, and Nationwide Fund Distributors LLC (“NFD”), principal underwriter to the Trust, is a wholly-owned subsidiary of NFS. | |
Additional information regarding the Trustees and Officers may be found in the Trust’s Statement of Additional Information, which is available without charge upon request, by calling 800-848-0920. |
Trustees who are Interested Persons (as defined in the 1940 Act) and/or Officers of the Trust as of June 30, 2007
Number of | ||||||||||
Position(s) Held | Portfolios in the | |||||||||
with the Trust | Principal Occupation(s) | Nationwide Fund | Other | |||||||
Name, Address | and Length of | During Past | Complex Overseen | Directorships | ||||||
and Year of Birth | Time Served1 | Five Years | by Trustee | Held by Trustee2 | ||||||
Arden L. Shisler c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1941 | Trustee since February 2000 | Retired. Mr. Shisler is the former President and Chief Executive Officer of KeB Transport, Inc., a trucking firm (2000 through 2002). He served as a consultant to KeB from January 2003 through December 2004. Since 1992, Mr. Shisler has also been Chairman of the Board for Nationwide Mutual Insurance Company.3 | 89 | Director of Nationwide Financial Services, Inc., Chairman of Nationwide Mutual Insurance Company3 | ||||||
John H. Grady Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1961 | President & Chief Executive Officer since December 2006 | Mr. Grady is President, and Chief Executive Officer of Nationwide Funds Group which includes Nationwide Fund Advisors,3 Nationwide Fund Management LLC,3 Nationwide Fund Distributors LLC 3 and NWD Investments,2 the asset management operations of Nationwide Mutual Insurance Company, which includes Morley Capital Management, Inc.,2 Nationwide Separate Accounts LLC,2 NorthPointe Capital LLC,2 and Nationwide SA Capital Trust2. From March 2004 until March 2006, Mr. Grady was Chief Executive Officer of Constellation Investment Management Co., L.P. (registered investment adviser), and President and Chief Executive Officer of Constellation Funds Group (registered investment companies). He also was President of Constellation Investment Distribution Co., Inc. (registered broker-dealer) from March 2004 until June 2006. From February 2001 until February 2004, Mr. Grady was Chief Operating and Chief Legal Officer; Managing Director, Mutual Funds Group, Turner Investment Partners, Inc. (registered investment adviser); Executive Vice President of Turner Funds and Turner Institutional Portfolios (registered investment companies); and President, Turner Investment Distributors, Inc. (registered broker-dealer). | N/A | None | ||||||
Gerald J. Holland Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken,PA 19428 1951 | Treasurer since March 2001 | Mr. Holland is Senior Vice President — Operations for Nationwide Funds Group3. | N/A | N/A |
Number of | ||||||||||
Position(s) Held | Portfolios in the | |||||||||
with the Trust | Principal Occupation(s) | Nationwide Fund | Other | |||||||
Name, Address | and Length of | During Past | Complex Overseen | Directorships | ||||||
and Year of Birth | Time Served1 | Five Years | by Trustee | Held by Trustee2 | ||||||
Michael A. Krulikowski Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1959 | Chief Compliance Officer from June 2004 to August 20074 | Mr. Krulikowski is Vice President and Chief Compliance Officer of Nationwide Funds Group3, Morley Capital Management, Inc.3 , Nationwide SA Capital Trust (since 1999)3, and Nationwide Separate Accounts LLC (since August 2005).3 Since June 2004, Mr. Krulikowski has also served as Chief Compliance Officer of the Trust. From November 1999 through May 2007, he served as Vice President and Chief Compliance Officer of NorthPointe Capital LLC. 3 | N/A | N/A | ||||||
Eric E. Miller Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1953 | Secretary since December 2002 | Mr. Miller is Senior Vice President, General Counsel, and Assistant Secretary for Nationwide Funds Group3 and NWD Investments.2 From August 2000 to August 2002, Mr. Miller was a Partner with Stradley Ronon Stevens & Young, LLP. | N/A | N/A | ||||||
1 | Length of time served includes time served with the Trust’s predecessors. | |
2 | Directorships held in (1) any other investment companies registered under the 1940 Act, (2) any company with a class of securities registered pursuant to Section 12 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or (3) any company subject to the requirements of Section 15(d) of the Exchange Act. | |
3 | This position is held with an affiliated person or principal underwriter of the Trust. | |
4 | Effective August 3, 2007, the Board of Trustees approved Carol Baldwin Moody as Chief Compliance Officer of the Trust. Since November 2005, Ms. Moody has been Senior Vice President, Chief Compliance Officer of Nationwide Financial Services, Nationwide Life Insurance Company, Nationwide Life and Annuity Insurance Company, and Nationwide Investment Advisors, LLC. From February 2004-November 2005, she was Chief Compliance Officer of TIAA-CREF and from April 2000-February 2004, she was Managing Director and General Counsel, TCW/ Latin America Partners, LLC and Baeza & Co., LLC. | |
Federal law requires the Trust, each of its investment advisers and sub-advisers to adopt procedures for voting proxies (“Proxy Voting Guidelines”) and to provide a summary of those Proxy Voting Guidelines used to vote the securities held by the Funds. The Funds’ proxy voting policies and procedures are available without charge (i) upon request, by calling 800-848-0920, (ii) on the Funds’ website at www.nationwidefunds.com, or (iii) on the Securities and Exchange Commission’s website at www.sec.gov. |
June 30, 2007 (Unaudited)
Contents | ||
6 | Statement of Investments | |
30 | Statement of Assets and Liabilities | |
31 | Statement of Operations | |
32 | Statements of Changes in Net Assets | |
33 | Financial Highlights | |
34 | Notes to Financial Statements |
Statement Regarding Availability of Proxy Voting Record.
SAR-SCX (8/07) | ![]() |
Dear Fellow Shareholder:
Since I last wrote to you, our mutual funds have enjoyed another period of solid performance, and the corporate realignment that was in progress is now finished.
On May 1, 2007, Nationwide Financial Services, Inc. (NFS), completed its acquisition of the Philadelphia-based retail mutual fund operations of NWD Investment Management, Inc. (formerly, “Gartmore Global Investments, Inc.”), from Nationwide Corporation, a subsidiary of Nationwide Mutual Insurance Company. Effective that date, the acquired entities were renamed Nationwide Funds Group (NFG), and the Gartmore Funds were renamed the Nationwide Funds to better align with the Nationwide® brand. Although the corporate ownership and fund names have changed, I can assure you that NFG intends to maintain as much continuity as possible with the Funds and key personnel.
Thank you, shareholders, for approving the new investment advisory agreement that was required due to the change in corporate ownership. The new agreement is identical in all material respects to the original agreement that it replaces, with the exception of the section pertaining to the vote by the shareholders of the NVIT Mid Cap Growth Fund to approve NorthPointe Capital®, LLC (NorthPointe) as sub-adviser to that particular Fund.
Market Overview: January 1-June 30, 2007
Share prices in general were buoyed in part by better-than-expected first-quarter 2007 earnings and a flurry of mergers and acquisitions, many of these spurred by readily available funding from private equity firms. In June, investors grew more cautious amid surging crude oil prices, a sudden spike in long-term interest rates, and the meltdown of two hedge funds that had exposure to the subprime mortgage market. Looking abroad, a weak U.S. dollar aided foreign stocks, as reflected in the 11.09% advance of the Morgan Stanley Capital International Europe, Australasia and Far East (MSCI EAFE®) Index. Emerging market performance was particularly robust.
The bond market struggled during the first half of 2007. While short-term interest rates remained stable, reflecting the Federal Reserve Board’s decision in June to leave the target federal funds rate at 5.25%, longer-term rates climbed during the first half of 2007, depressing bond prices and forcing the Lehman Brothers® U.S. Aggregate Index to settle for a modest 0.97% return.
We at NFG thank you for your understanding and cooperation throughout our recent transition period. We emerge from this period energized for the future, and we look forward to serving your investment needs for a long time to come.
Market index performance is provided by a third-party source Nationwide Funds Group deems to be reliable. Indexes are unmanaged and have been provided for illustrative purposes only. No fees or expenses are reflected. Individuals cannot invest directly in an index.
PAST PERFORMANCE IS NO GUARANTEE OF FUTURE RESULTS
Nationwide Funds are advised by Nationwide Fund Advisors (NFA). NFA is a wholly-owned subsidiary of Nationwide Financial Services. Nationwide Financial Services is a wholly-owned subsidiary of Nationwide Corporation. All of the common stock of Nationwide Corporation is held by Nationwide Mutual (95.2%) and Nationwide Mutual Fire Insurance Company (4.8%), each of which is a mutual company owned by its policyholders.
Nationwide Funds Group (NFG) is the mutual fund arm of Nationwide Financial Services (NYSE: NFS). Based in Conshohocken Pa., a suburb of Philadelphia, NFG is comprised of Nationwide Fund Advisors, Nationwide Fund Distributors, LLC, and Nationwide Fund Management, LLC. Together, these provide advisory, distribution, and administration services respectively to the Nationwide Funds, and manage more than $43.5 billion in assets as of June 30, 2007, of which more than $12 billion are in “fund of funds” designed to provide asset allocation across several types of investments and asset classes.
Lehman Brothers (LB) U.S. Aggregate Index: An unmanaged, market value-weighted index of investment-grade, fixed-rate debt issues (including government, corporate, asset-backed, and mortgage-backed securities with maturities of one year or more) that is generally representative of the bond market as a whole.
Morgan Stanley Capital International Europe, Australasia and Far East (MSCI EAFE®) Index: An unmanaged, free float-adjusted, market capitalization-weighted index that is designed to measure the performance of stocks in developed markets outside the United States and Canada.
Standard & Poor’s 500® (S&P 500) Index: An unmanaged, market capitalization-weighted index of 500 widely held stocks of large-cap U.S. companies that gives a broad look at how the stock prices of those companies have performed.
Views expressed within are those of Nationwide Funds Group as of the date noted, are subject to change at any time, and may not come to pass.
This report is for informational purposes only, and is not intended as an offer or recommendation with respect to the purchase or sale of any security, option, future, or other derivatives in such securities.
Investing in mutual funds involves risk, including possible loss of principal.
Investors should carefully consider a fund’s investment objectives, risks, fees, charges, and expenses before investing any money. To obtain this and other fund information, please call 800-848-0920 to request a prospectus, or download a prospectus at www.nationwidefunds.com. Please read the prospectus carefully before investing any money.
Nationwide Funds distributed by Nationwide Fund Distributors LLC (formerly Gartmore Distribution Services, Inc.), Member NASD. 1200 River Road, Suite 1000, Conshohocken, Pa. 19428.
As a shareholder of the Fund, you incur two types of costs: (1) transaction costs, including sales charges (loads) paid on purchase payments and redemption fees; and (2) ongoing costs, including investment advisory fees, administration fees, distribution fees and other Fund expenses. The examples below are 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. Per SEC requirements, the examples assume that you had a $1,000 investment in the Class at the beginning of the reporting period, April 13, 2007, and continued to hold your shares at the end of the reporting period, June 30, 2007.
Actual Expenses
Hypothetical Example for Comparison Purposes
Please note that the expenses shown in the table are meant to highlight your ongoing costs only and do not reflect any transaction costs, such as sales charges (loads) or redemption fees. Therefore, the second line for each Class in 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 transaction costs were included, your costs would have been higher. The examples also assume all dividends and distributions have been reinvested.
Schedule of Shareholder Expenses
Beginning | Ending | Expenses | ||||||||||||||||||||
Account Value | Account Value | Paid | Annualized | |||||||||||||||||||
NVIT Small Cap Index Fund | 04/13/07 | 06/30/07 | During Period* | Expense Ratio** | ||||||||||||||||||
Class ID | Actual | $ | 1,000.00 | $ | 1,018.70 | $ | 0.66 | 0.30% | ||||||||||||||
Hypothetical | 1 | $ | 1,000.00 | $ | 1,010.15 | $ | 0.65 | 0.30% | ||||||||||||||
* | Expenses are equal to the Fund’s annualized expense ratio multiplied by the average account value over the period multiplied by 79/365 (to reflect the period of operations). The expenses reported above do not include the effect of additional expenses imposed by variable annuity contracts. | |
** | Information shown reflects values using the expense ratios from April 13, 2007 (commencement of operations) to June 30, 2007 and has been annualized to reflect for the period from April 13, 2007 to June 30, 2007, in accordance with SEC guidelines. | |
1 | Represents the hypothetical 5% return before expenses. |
Asset Allocation | ||||
Common Stock | 88.3% | |||
Repurchase Agreements | 11.8% | |||
Liabilities in excess of other assets | -0.1% | |||
100.0% |
Top Holdings* | ||||
C.F. Industries Holdings, Inc. | 0.2% | |||
FLIR Systems, Inc. | 0.2% | |||
Florida East Coast Industries, Inc. | 0.2% | |||
Polycom, Inc. | 0.2% | |||
Sotheby’s Holdings, Inc. | 0.2% | |||
Time Warner Telecom, Inc. | 0.2% | |||
Hologic, Inc. | 0.2% | |||
ValueClick, Inc. | 0.2% | |||
Equinix, Inc. | 0.2% | |||
Alexandria Real Estate Equities, Inc. | 0.2% | |||
Other | 98.0% | |||
100.0% |
Top Industries | ||||
Real Estate Investment Trusts (REITs) | 5.8% | |||
Commercial Banks | 5.0% | |||
Commercial Services & Supplies | 4.0% | |||
Insurance | 3.3% | |||
Semiconductors & Semiconductor Equipment | 3.2% | |||
Health Care Equipment & Supplies | 3.0% | |||
Software | 3.0% | |||
Specialty Retail | 3.0% | |||
Oil, Gas & Consumable Fuels | 2.8% | |||
Hotels, Restaurants & Leisure | 2.6% | |||
Other | 64.3% | |||
100.0% |
* | For purpose of listing top holdings, repurchase agreements are included as part of Other. |
NVIT Small Cap Index
Common Stock (88.3%) | ||||||||
Shares or | ||||||||
Principal Amount | Value | |||||||
Aerospace & Defense (1.3%) | ||||||||
AAR Corp.* | 8,400 | $ | 277,284 | |||||
Aerovironment, Inc.* | 500 | 10,305 | ||||||
Argon St., Inc.* | 3,900 | 90,519 | ||||||
Ceradyne, Inc.* | 5,900 | 436,364 | ||||||
Cubic Corp. | 2,200 | 66,396 | ||||||
Curtiss-Wright Corp. | 8,400 | 391,524 | ||||||
Dyncorp International, Inc.* | 6,200 | 136,338 | ||||||
EDO Corp. | 4,400 | 144,628 | ||||||
Esterline Technologies Corp.* | 4,700 | 227,057 | ||||||
Gencorp, Inc.* | 10,600 | 138,542 | ||||||
Geoeye, Inc.* | 2,400 | 52,152 | ||||||
HEICO Corp. | 5,200 | 218,816 | ||||||
Hexcel Corp.* | 17,900 | 377,153 | ||||||
Innovative Solutions and Support, Inc.* | 3,500 | 81,270 | ||||||
Ionatron, Inc.* | 9,800 | 38,220 | ||||||
Ladish Co., Inc.* | 3,600 | 154,800 | ||||||
Moog, Inc., Class A* | 7,700 | 339,647 | ||||||
MTC Technologies, Inc.* | 1,600 | 39,296 | ||||||
Orbital Sciences Corp.* | 12,000 | 252,120 | ||||||
Stanley, Inc.* | 300 | 5,286 | ||||||
Taser International, Inc.* | 14,300 | 199,628 | ||||||
Teledyne Technologies, Inc.* | 7,100 | 326,245 | ||||||
Triumph Group, Inc. | 3,500 | 229,145 | ||||||
United Industrial Corp. | 2,200 | 131,956 | ||||||
4,364,691 | ||||||||
Air Freight & Logistics (0.4%) | ||||||||
ABX Air, Inc.* | 10,723 | 86,427 | ||||||
Atlas Air Worldwide Holdings, Inc.* | 3,300 | 194,502 | ||||||
Dynamex, Inc.* | 1,800 | 45,954 | ||||||
EGL, Inc.* | 6,500 | 302,120 | ||||||
Forward Air Corp. | 6,300 | 214,767 | ||||||
HUB Group, Inc., Class A* | 7,400 | 260,184 | ||||||
Pacer International, Inc. | 7,400 | 174,048 | ||||||
1,278,002 | ||||||||
Airlines (0.5%) | ||||||||
AirTran Holdings, Inc.* | 18,100 | 197,652 | ||||||
Alaska Air Group, Inc.* | 7,900 | 220,094 | ||||||
Allegiant Travel Co.* | 300 | 9,222 | ||||||
ExpressJet Holdings, Inc.* | 7,000 | 41,860 | ||||||
JetBlue Airways Corp.* | 36,100 | 424,175 | ||||||
Midwest Air Group, Inc.* | 3,500 | 52,570 | ||||||
Pinnacle Airlines Corp.* | 4,700 | 88,125 | ||||||
Republic Airways Holdings, Inc.* | 6,100 | 124,135 | ||||||
SkyWest, Inc. | 14,200 | 338,386 | ||||||
1,496,219 | ||||||||
Auto Components (1.0%) | ||||||||
Aftermarket Technology Corp.* | 4,400 | 130,592 | ||||||
American Axle & Manufacturing Holdings, Inc. | 9,000 | 266,580 | ||||||
Amerigon, Inc.* | 5,700 | 102,543 | ||||||
ArvinMeritor, Inc. | 14,500 | 321,900 | ||||||
Cooper Tire & Rubber Co. | 12,500 | 345,250 | ||||||
Drew Industries, Inc.* | 3,100 | 102,734 | ||||||
GenTek, Inc.* | 1,700 | 59,874 | ||||||
Hayes Lemmerz International, Inc.* | 23,300 | 124,655 | ||||||
Lear Corp.* | 14,700 | 523,467 | ||||||
LKQ Corp.* | 9,200 | 226,872 | ||||||
Modine Manufacturing Co. | 6,200 | 140,120 | ||||||
Noble International Ltd. | 2,900 | 59,276 | ||||||
Raser Technologies, Inc.* | 3,200 | 23,648 | ||||||
RSC Holdings, Inc.* | 2,600 | 52,000 | ||||||
Sauer-Danfoss, Inc. | 1,300 | 38,688 | ||||||
Spartan Motors, Inc. | 7,050 | 119,991 | ||||||
Standard Motor Products, Inc. | 1,700 | 25,551 | ||||||
Superior Industries International, Inc. | 5,500 | 119,680 | ||||||
Tenneco Automotive, Inc.* | 9,300 | 325,872 | ||||||
Visteon Corp.* | 26,200 | 212,220 | ||||||
3,321,513 | ||||||||
Automobiles (0.1%) | ||||||||
Fleetwood Enterprises, Inc.* | 12,900 | 116,745 | ||||||
Midas, Inc.* | 3,000 | 68,010 | ||||||
Monaco Coach Corp. | 6,300 | 90,405 | ||||||
Winnebago Industries, Inc. | 6,400 | 188,928 | ||||||
464,088 | ||||||||
Banks (0.3%) | ||||||||
Flushing Financial Corp. | 4,500 | 72,270 | ||||||
FNB Corp. | 10,300 | 172,422 | ||||||
Hancock Holding Co. | 5,400 | 202,770 | ||||||
Oritani Financial Corp.* | 200 | 2,858 | ||||||
Park National Corp. | 2,200 | 186,538 | ||||||
Susquehanna Bancshares, Inc. | 11,000 | 246,070 | ||||||
882,928 | ||||||||
Beverages (0.1%) | ||||||||
Boston Beer Co., Inc., Class A* | 2,600 | 102,310 | ||||||
Coca-Cola Bottling Co. | 600 | 30,180 | ||||||
Jones Soda Co.* | 6,600 | 92,532 | ||||||
MGP Ingredients, Inc. | 2,000 | 33,800 | ||||||
National Beverage Corp. | 1,440 | 16,574 | ||||||
275,396 | ||||||||
Common Stock (continued) | ||||||||
Shares or | ||||||||
Principal Amount | Value | |||||||
Biotechnology (1.9%) | ||||||||
Acorda Therapeutics, Inc.* | 3,100 | $ | 52,886 | |||||
Affymax, Inc.* | 100 | 2,696 | ||||||
Alkermes, Inc.* | 19,400 | 283,240 | ||||||
ARIAD, Inc.* | 18,000 | 98,820 | ||||||
Arqule, Inc.* | 9,400 | 66,270 | ||||||
Array BioPharma, Inc.* | 7,400 | 86,358 | ||||||
Bio-Rad Laboratories, Inc., Class A* | 3,600 | 272,052 | ||||||
Bio-Reference Laboratories, Inc.* | 2,500 | 68,375 | ||||||
Bioenvision, Inc. | 7,300 | 42,194 | ||||||
Biomimetic Therapeutics, Inc.* | 3,400 | 53,142 | ||||||
C.V. Therapeutics, Inc.* | 13,700 | 180,977 | ||||||
Cambrex Corp. | 5,800 | 76,966 | ||||||
Celera Genomics Group* | 14,200 | 176,080 | ||||||
Cell Genesys, Inc.* | 18,300 | 61,305 | ||||||
Cepheid, Inc.* | 12,800 | 186,880 | ||||||
Cytokinetics, Inc.* | 4,600 | 25,990 | ||||||
Cytrx Corp.* | 13,500 | 42,120 | ||||||
Dendreon Corp.* | 19,800 | 140,184 | ||||||
Exelixis, Inc.* | 18,600 | 225,060 | ||||||
FEI Co.* | 6,400 | 207,744 | ||||||
Genomic Health, Inc.* | 1,600 | 30,080 | ||||||
GenVec, Inc.* | 21,300 | 50,055 | ||||||
Geron Corp.* | 17,600 | 123,904 | ||||||
Halozyme Therapeutics, Inc.* | 10,800 | 99,684 | ||||||
Human Genome Sciences, Inc.* | 29,600 | 264,032 | ||||||
Immunomedics, Inc.* | 16,400 | 68,060 | ||||||
Incyte Genomics, Inc.* | 18,200 | 109,200 | ||||||
InterMune, Inc.* | 5,500 | 142,670 | ||||||
Kosan Biosciences, Inc.* | 5,200 | 27,144 | ||||||
Mannkind Corp.* | 6,800 | 83,844 | ||||||
Martek Biosciences Corp.* | 6,500 | 168,805 | ||||||
Maxygen, Inc.* | 4,300 | 36,851 | ||||||
Medarex, Inc.* | 26,900 | 384,401 | ||||||
Medivation, Inc.* | 5,500 | 112,365 | ||||||
Metabolix, Inc.* | 2,600 | 65,078 | ||||||
Myriad Genetics, Inc.* | 8,700 | 323,553 | ||||||
Nektar Therapeutics* | 20,600 | 195,494 | ||||||
Neurocrine Biosciences, Inc.* | 8,400 | 94,332 | ||||||
Neurogen Corp.* | 3,600 | 23,904 | ||||||
Novacea, Inc.* | 3,400 | 32,130 | ||||||
Orexigen Therapeutics, Inc.* | 100 | 1,502 | ||||||
Orthofix International N.V.* | 2,700 | 121,419 | ||||||
Osiris Therapeutics, Inc.* | 900 | 12,159 | ||||||
Pharmion Corp.* | 5,300 | 153,435 | ||||||
Protalix Biotherapeutics, Inc.* | 5,400 | 145,746 | ||||||
Regeneration Technologies, Inc.* | 8,000 | 90,000 | ||||||
Seattle Genetics, Inc.* | 6,200 | 60,822 | ||||||
Senomyx, Inc.* | 7,700 | 103,950 | ||||||
Sonic Innovations, Inc.* | 7,800 | 68,250 | ||||||
Tanox, Inc.* | 5,000 | 97,050 | ||||||
Telik, Inc.* | 15,600 | 52,728 | ||||||
Tercica, Inc.* | 3,100 | 15,810 | ||||||
United Therapeutics Corp.* | 4,200 | 267,792 | ||||||
Vivus, Inc.* | 7,600 | 39,748 | ||||||
XOMA Ltd.* | 20,200 | 61,408 | ||||||
Zymogenetics, Inc.* | 6,300 | 92,043 | ||||||
6,168,787 | ||||||||
Building Products (0.5%) | ||||||||
Aaon, Inc. | 900 | 28,665 | ||||||
American Woodmark Corp. | 3,000 | 103,800 | ||||||
Ameron International Corp. | 2,200 | 198,418 | ||||||
Apogee Enterprises, Inc. | 6,900 | 191,958 | ||||||
Builders FirstSource, Inc.* | 2,400 | 38,544 | ||||||
Goodman Global, Inc.* | 6,300 | 139,986 | ||||||
Griffon Corp.* | 6,300 | 137,214 | ||||||
Insteel Industries, Inc. | 3,700 | 66,600 | ||||||
NCI Building Systems, Inc.* | 4,600 | 226,918 | ||||||
PGT, Inc.* | 700 | 7,651 | ||||||
Simpson Manufacturing Co., Inc. | 6,900 | 232,806 | ||||||
Trex Co., Inc.* | 2,400 | 47,112 | ||||||
Universal Forest Products, Inc. | 4,100 | 173,266 | ||||||
1,592,938 | ||||||||
Capital Markets (1.3%) | ||||||||
ACA Capital Holdings, Inc.* | 300 | 3,570 | ||||||
Apollo Investment Corp. | 21,700 | 466,984 | ||||||
Ares Capital Corp. | 13,990 | 235,732 | ||||||
Calamos Asset Management, Inc. | 5,900 | 150,745 | ||||||
Capital Southwest Corp. | 600 | 93,474 | ||||||
Cohen & Steers, Inc. | 3,000 | 130,350 | ||||||
Cowen Group, Inc.* | 1,900 | 34,029 | ||||||
Evercore Partners, Inc. | 800 | 23,816 | ||||||
FCStone Group, Inc.* | 1,600 | 91,696 | ||||||
Freedom Acquisition Holdings, Inc.* | 10,700 | 117,807 | ||||||
GAMCO, Investors, Inc., Class A | 1,200 | 67,260 | ||||||
Gladstone Capital Corp. | 2,400 | 51,504 | ||||||
Greenhill & Co., Inc. | 3,600 | 247,356 | ||||||
Hercules Technology Growth Capital, Inc. | 7,000 | 94,570 | ||||||
KBW, Inc.* | 5,000 | 146,900 | ||||||
Knight Capital Group, Inc., Class A* | 22,800 | 378,480 | ||||||
Kohlberg Capital Corp. | 2,700 | 50,085 | ||||||
Labranche & Co., Inc.* | 9,200 | 67,896 | ||||||
Marketaxess Holdings, Inc.* | 6,300 | 113,337 | ||||||
MCG Capital Corp. | 12,600 | 201,852 |
NVIT Small Cap Index (Continued)
Common Stock (continued) | ||||||||
Shares or | ||||||||
Principal Amount | Value | |||||||
Capital Markets (continued) | ||||||||
MVC Capital, Inc. | 6,400 | $ | 120,384 | |||||
optionsXpress Holdings, Inc. | 7,800 | 200,148 | ||||||
Penson Worldwide, Inc.* | 2,100 | 51,513 | ||||||
Piper Jaffray Cos.* | 3,800 | 211,774 | ||||||
Sanders Morris Harris Group, Inc. | 1,800 | 20,952 | ||||||
Stifel Financial Corp.* | 2,600 | 153,114 | ||||||
SWS Group, Inc. | 5,400 | 116,748 | ||||||
Technology Investment Capital Corp. | 2,800 | 44,212 | ||||||
Thomas Weisel Partners Group, Inc.* | 3,100 | 51,615 | ||||||
TradeStation Group, Inc.* | 7,800 | 90,870 | ||||||
Waddell & Reed Financial, Inc. | 16,900 | 439,569 | ||||||
�� | 4,268,342 | |||||||
Chemicals (1.9%) | ||||||||
A. Schulman, Inc. | 7,000 | 170,310 | ||||||
American Vanguard Corp. | 2,200 | 31,504 | ||||||
Arch Chemicals, Inc. | 4,200 | 147,588 | ||||||
Balchem Corp. | 2,700 | 49,059 | ||||||
C.F. Industries Holdings, Inc. | 11,200 | 670,768 | ||||||
Calgon Carbon Corp.* | 9,600 | 111,360 | ||||||
Ferro Corp. | 8,800 | 219,384 | ||||||
Flotek Industries, Inc.* | 2,200 | 131,890 | ||||||
Fuller (H. B.) Co. | 12,200 | 364,658 | ||||||
Georgia Gulf Corp. | 8,200 | 148,502 | ||||||
Hercules, Inc.* | 23,500 | 461,775 | ||||||
Innophos Holdings, Inc. | 2,500 | 35,750 | ||||||
Innospec, Inc. | 2,400 | 142,104 | ||||||
Koppers Holdings, Inc. | 3,500 | 117,880 | ||||||
Kronos Worldwide, Inc. | 500 | 12,625 | ||||||
Landec Corp.* | 2,400 | 32,160 | ||||||
LSB Industries, Inc.* | 3,900 | 83,382 | ||||||
Minerals Technologies, Inc. | 4,400 | 294,580 | ||||||
N.L. Industries, Inc. | 1,400 | 14,028 | ||||||
Newmarket Corp. | 3,100 | 149,947 | ||||||
O.M. Group, Inc.* | 6,300 | 333,396 | ||||||
Olin Corp. | 14,900 | 312,900 | ||||||
Pioneer Cos., Inc.* | 2,900 | 99,673 | ||||||
PolyOne Corp.* | 18,100 | 130,139 | ||||||
Rockwood Holdings, Inc.* | 6,300 | 230,265 | ||||||
Sensient Technologies Corp. | 9,500 | 241,205 | ||||||
Shengdatech, Inc.* | 1,700 | 9,044 | ||||||
Spartech Corp. | 6,100 | 161,955 | ||||||
Stepan Co. | 1,300 | 39,364 | ||||||
Symyx Technologies, Inc.* | 8,700 | 100,137 | ||||||
Terra Industries, Inc.* | 18,700 | 475,354 | ||||||
Tronox, Inc. | 1,200 | 17,256 | ||||||
Tronox, Inc., Class B | 5,700 | 80,085 | ||||||
W.R. Grace & Co.* | 14,200 | 347,758 | ||||||
Zoltek Cos., Inc.* | 4,400 | 182,732 | ||||||
6,150,517 | ||||||||
Commercial Banks (5.0%) | ||||||||
1st Source Corp. | 1,600 | 39,872 | ||||||
Alabama National Bancorp | 3,400 | 210,256 | ||||||
Amcore Financial, Inc. | 4,700 | 136,253 | ||||||
Americanwest Bancorp | 3,500 | 63,805 | ||||||
Ameris Bancorp | 2,700 | 60,669 | ||||||
BancFirst Corp. | 1,000 | 42,820 | ||||||
Banco Latinoamericano de Exportaciones, S.A. — PA | 3,900 | 73,320 | ||||||
Bancorp, Inc. (The)* | 3,500 | 78,260 | ||||||
Bank of the Ozarks, Inc. | 2,400 | 66,888 | ||||||
BankFinancial Corp. | 4,600 | 71,070 | ||||||
Banner Corp. | 3,000 | 102,180 | ||||||
Boston Private Financial Holdings, Inc. | 8,100 | 217,647 | ||||||
Capital City Bank Group, Inc. | 1,700 | 53,278 | ||||||
Capital Corp. of the West | 1,900 | 45,524 | ||||||
Capitol Bancorp Ltd. | 2,900 | 79,257 | ||||||
Cascade Bancorp | 6,000 | 138,840 | ||||||
Cathay General Bancorp, Inc. | 10,300 | 345,462 | ||||||
Centennial Bank Holdings, Inc.* | 11,100 | 94,017 | ||||||
Center Financial Corp. | 2,800 | 47,376 | ||||||
Central Pacific Financial Corp. | 5,700 | 188,157 | ||||||
Chemical Financial Corp. | 5,000 | 129,350 | ||||||
Chittenden Corp. | 9,000 | 314,550 | ||||||
Citizens Banking Corp. | 16,900 | 309,270 | ||||||
City Holding Co. | 3,500 | 134,155 | ||||||
Cobiz, Inc. | 3,700 | 67,044 | ||||||
Columbia Banking System, Inc. | 3,300 | 96,525 | ||||||
Community Bancorp* | 2,200 | 61,556 | ||||||
Community Bank System, Inc. | 5,800 | 116,116 | ||||||
Community Banks, Inc. | 4,000 | 128,880 | ||||||
Community Trust Bancorp, Inc. | 3,100 | 100,130 | ||||||
CVB Financial Corp. | 12,200 | 135,664 | ||||||
Enterprise Financial Services Corp. | 900 | 22,374 | ||||||
First Bancorp | 2,400 | 44,952 | ||||||
First BanCorp. Puerto Rico | 15,600 | 171,444 | ||||||
First Charter Corp. | 7,100 | 138,237 | ||||||
First Commonwealth Financial Corp. | 12,900 | 140,868 | ||||||
First Community Bancorp | 5,200 | 297,492 | ||||||
First Community Bankshares, Inc. | 1,500 | 46,785 | ||||||
First Financial Bancorp | 6,700 | 100,433 | ||||||
First Financial Bankshares, Inc. | 3,500 | 135,835 | ||||||
First Financial Corp. | 2,700 | 79,272 |
Common Stock (continued) | ||||||||
Shares or | ||||||||
Principal Amount | Value | |||||||
Commercial Banks (continued) | ||||||||
First Indiana Corp. | 3,900 | $ | 86,268 | |||||
First Merchants Corp. | 2,700 | 64,881 | ||||||
First Midwest Bancorp, Inc. | 10,900 | 387,059 | ||||||
First Regional Bancorp* | 2,600 | 66,144 | ||||||
First Republic Bancorp, Inc. | 5,700 | 305,862 | ||||||
First South Bancorp, Inc. | 700 | 18,830 | ||||||
First State Bancorp | 5,100 | 108,579 | ||||||
FirstMerit Corp. | 17,800 | 372,554 | ||||||
Frontier Financial Corp. | 7,900 | 177,987 | ||||||
Glacier Bancorp, Inc. | 9,700 | 197,395 | ||||||
Great Southern Bancorp, Inc. | 1,400 | 37,870 | ||||||
Greater Bay Bancorp | 11,500 | 320,160 | ||||||
Greene County Bancshares, Inc. | 1,300 | 40,638 | ||||||
Hanmi Financial Corp. | 8,200 | 139,892 | ||||||
Harleysville National Corp. | 5,800 | 93,496 | ||||||
Heartland Financial U.S.A., Inc. | 1,800 | 43,740 | ||||||
Heritage Commerce Corp. | 2,300 | 54,464 | ||||||
Home Bancshares, Inc. | 900 | 20,295 | ||||||
Horizon Financial Corp. | 2,700 | 58,833 | ||||||
Iberiabank Corp. | 2,300 | 113,735 | ||||||
Independent Bank Corp. | 3,700 | 109,298 | ||||||
Independent Bank Corp., Michigan | 6,500 | 111,865 | ||||||
Integra Bank Corp. | 5,300 | 113,791 | ||||||
International Bancshares Corp. | 9,850 | 252,357 | ||||||
Investors Bancorp, Inc.* | 9,343 | 125,477 | ||||||
Irwin Financial Corp. | 3,800 | 56,886 | ||||||
Lakeland Bancorp, Inc. | 1,700 | 22,610 | ||||||
Lakeland Financial Corp. | 1,900 | 40,413 | ||||||
M.B. Financial, Inc. | 6,400 | 222,336 | ||||||
Macatawa Bank Corp. | 5,190 | 82,573 | ||||||
Mainsource Financial Group, Inc. | 3,600 | 60,444 | ||||||
Midwest Banc Holding, Inc. | 3,300 | 47,850 | ||||||
Nara Bankcorp, Inc. | 5,000 | 79,650 | ||||||
National Penn Bancshares, Inc. | 8,400 | 140,112 | ||||||
NBT Bancorp, Inc. | 6,000 | 135,360 | ||||||
Old National Bancorp | 13,400 | 222,574 | ||||||
Old Second Bancorp, Inc. | 3,379 | 98,532 | ||||||
Omega Financial Corp. | 1,600 | 43,024 | ||||||
Oriental Financial Group — PR | 6,000 | 65,460 | ||||||
Pacific Capital Bancorp | 9,799 | 264,377 | ||||||
Peoples Bancorp, Inc. | 1,900 | 51,433 | ||||||
Preferred Bank | 1,900 | 76,000 | ||||||
PrivateBancorp, Inc. | 4,800 | 138,240 | ||||||
Prosperity Bancshares, Inc. | 7,200 | 235,872 | ||||||
Provident Bankshares Corp. | 7,500 | 245,850 | ||||||
Renasant Corp. | 5,000 | 113,700 | ||||||
Republic Bancorp, Inc., Class A | 1,300 | 21,567 | ||||||
Royal Bancshares of Pennsylvania, Inc., Class A | 400 | 7,884 | ||||||
S&T Bancorp, Inc. | 4,700 | 154,630 | ||||||
S.Y. Bancorp, Inc. | 1,428 | 33,929 | ||||||
Sandy Spring Bancorp, Inc. | 3,200 | 100,608 | ||||||
Santander Bancorp — PR | 100 | 1,486 | ||||||
SCBT Financial Corp. | 1,000 | 36,400 | ||||||
Seacoast Banking Corp. of Florida | 4,200 | 91,350 | ||||||
Security Bank Corp. | 3,100 | 62,310 | ||||||
Sierra Bancorp | 400 | 11,280 | ||||||
Signature Bank* | 6,900 | 235,290 | ||||||
Simmons First National Corp., Class A | 2,200 | 60,698 | ||||||
South Financial Group, Inc. | 13,600 | 307,904 | ||||||
Southside Bancshares, Inc. | 2,225 | 48,327 | ||||||
Southwest Bancorp | 3,100 | 74,524 | ||||||
Sterling Bancorp | 5,400 | 86,562 | ||||||
Sterling Bancshares, Inc. | 17,900 | 202,449 | ||||||
Sterling Financial Corp. | 7,500 | 78,900 | ||||||
Sterling Financial Corp. (Spokane) | 10,400 | 300,976 | ||||||
Suffolk Bancorp | 3,000 | 95,760 | ||||||
Sun Bancorp, Inc.* | 2,505 | 42,259 | ||||||
Superior Bancorp.* | 7,000 | 71,610 | ||||||
SVB Financial Group* | 7,500 | 398,325 | ||||||
Taylor Capital Group, Inc. | 1,200 | 33,036 | ||||||
Texas Capital Bancshares, Inc.* | 5,800 | 129,630 | ||||||
Tompkins Trustco, Inc. | 1,300 | 48,620 | ||||||
Trico Bancshares | 1,800 | 40,248 | ||||||
Trustmark Corp. | 10,300 | 266,358 | ||||||
UCBH Holdings, Inc. | 21,900 | 400,113 | ||||||
UMB Financial Corp. | 6,300 | 232,281 | ||||||
Umpqua Holdings Corp. | 13,700 | 322,087 | ||||||
Union Bankshares Corp. | 2,100 | 48,720 | ||||||
United Bankshares, Inc. | 8,200 | 260,760 | ||||||
United Community Banks, Inc. | 7,400 | 191,586 | ||||||
United Security Bancshares | 3,100 | 63,178 | ||||||
Univest Corp. of Pennsylvania | 1,200 | 27,024 | ||||||
USB Holding Co., Inc. | 1,800 | 34,308 | ||||||
Virginia Commerce Bancorp, Inc.* | 4,900 | 82,859 | ||||||
W Holding Co., Inc. | 17,200 | 45,408 | ||||||
Washington Trust Bancorp | 2,300 | 57,983 | ||||||
WesBanco, Inc. | 5,100 | 150,450 | ||||||
West America Bankcorp | 6,800 | 300,832 | ||||||
West Coast Bancorp | 2,100 | 63,819 | ||||||
Western Alliance Bancorp* | 2,300 | 68,655 | ||||||
Wilshire Bankcorp, Inc. | 3,400 | 41,412 |
NVIT Small Cap Index (Continued)
Common Stock (continued) | ||||||||
Shares or | ||||||||
Principal Amount | Value | |||||||
Commercial Banks (continued) | ||||||||
Wintrust Financial Corp. | 5,600 | $ | 245,560 | |||||
Yardville National Bancorp | 1,567 | 53,513 | ||||||
16,524,117 | ||||||||
Commercial Services & Supplies (4.0%) | ||||||||
ABM Industries, Inc. | 9,400 | 242,614 | ||||||
Acco Brands Corp.* | 9,600 | 221,280 | ||||||
Administaff, Inc. | 4,700 | 157,403 | ||||||
Advisory Board Co. (The)* | 4,300 | 238,908 | ||||||
Ambassadors International | 2,500 | 83,150 | ||||||
American Ecology Corp. | 3,300 | 70,686 | ||||||
American Reprographics Co.* | 6,000 | 184,740 | ||||||
Amper Corp. | 300 | 14,265 | ||||||
Barrett Business Services, Inc. | 2,600 | 67,158 | ||||||
Bowne & Co., Inc. | 7,200 | 140,472 | ||||||
Brady Corp., Class A | 9,313 | 345,885 | ||||||
Casella Waste Systems, Inc., Class A* | 4,600 | 49,588 | ||||||
CBIZ, Inc.* | 9,600 | 70,560 | ||||||
CDI Corp. | 2,800 | 90,160 | ||||||
Cenveo, Inc.* | 10,800 | 250,452 | ||||||
Clean Harbors, Inc.* | 3,600 | 177,912 | ||||||
CompX International, Inc. | 200 | 3,700 | ||||||
Comsys IT Partners, Inc.* | 4,600 | 104,926 | ||||||
Consolidated Graphics, Inc.* | 2,100 | 145,488 | ||||||
Cornell Cos., Inc.* | 2,400 | 58,944 | ||||||
CoStar Group, Inc.* | 3,900 | 206,232 | ||||||
CRA International, Inc.* | 3,100 | 149,420 | ||||||
Deluxe Corp. | 10,500 | 426,405 | ||||||
Diamond Management & Technology Consultants, Inc. | 5,700 | 75,240 | ||||||
Ennis, Inc. | 4,500 | 105,840 | ||||||
Exponet, Inc.* | 3,700 | 82,769 | ||||||
First Advantage Corp., Class A* | 2,000 | 46,020 | ||||||
FTI Consulting, Inc.* | 8,200 | 311,846 | ||||||
Fuel Tech, Inc.* | 2,700 | 92,475 | ||||||
G & K Services, Inc., Class A | 4,300 | 169,893 | ||||||
Geo Group, Inc. (The)* | 10,200 | 296,820 | ||||||
Healthcare Services Group, Inc. | 6,100 | 179,950 | ||||||
Herman Miller, Inc. | 13,800 | 436,080 | ||||||
Hudson Highland Group, Inc.* | 6,100 | 130,479 | ||||||
Huron Consulting Group, Inc.* | 3,800 | 277,438 | ||||||
ICT Group, Inc.* | 1,600 | 29,936 | ||||||
IHS, Inc., Class A* | 5,600 | 257,600 | ||||||
IKON Office Solutions, Inc. | 21,500 | 335,615 | ||||||
Interface, Inc. | 11,000 | 207,460 | ||||||
Kelly Services, Inc. | 5,100 | 140,046 | ||||||
Kenexa Corp.* | 5,700 | 214,947 | ||||||
Kforce, Inc.* | 7,200 | 115,056 | ||||||
Knoll, Inc. | 8,700 | 194,880 | ||||||
Korn/ Ferry International* | 8,600 | 225,836 | ||||||
Labor Ready, Inc.* | 9,400 | 217,234 | ||||||
Layne Christensen Co.* | 3,400 | 139,230 | ||||||
LECG Corp.* | 6,300 | 95,193 | ||||||
M & F Worldwide Corp.* | 2,400 | 159,792 | ||||||
Manhattan Associates, Inc.* | 5,400 | 150,714 | ||||||
McGrath Rentcorp | 4,000 | 134,760 | ||||||
Mine Safety Appliances Co. | 5,400 | 236,304 | ||||||
Mobile Mini, Inc.* | 8,300 | 242,360 | ||||||
Multi-Color Corp. | 1,300 | 51,103 | ||||||
Navigant Consulting, Inc.* | 11,600 | 215,296 | ||||||
Odyssey Marine Exploration, Inc.* | 11,800 | 70,918 | ||||||
On Assignment, Inc.* | 9,100 | 97,552 | ||||||
PeopleSupport, Inc.* | 4,800 | 54,480 | ||||||
PHH Corp.* | 10,400 | 324,584 | ||||||
Pike Electric Corp.* | 3,600 | 80,568 | ||||||
Resources Connection, Inc.* | 10,900 | 361,662 | ||||||
Rollins, Inc. | 5,700 | 129,789 | ||||||
SAIC, Inc.* | 20,000 | 361,400 | ||||||
Schawk, Inc., Class A | 3,000 | 60,060 | ||||||
School Specialty, Inc.* | 4,600 | 163,024 | ||||||
Spherion Corp.* | 11,400 | 107,046 | ||||||
Standard Parking Corp.* | 500 | 17,565 | ||||||
Standard Register Co. | 2,900 | 33,060 | ||||||
Steiner Leisure Ltd. — BS* | 2,800 | 137,536 | ||||||
Taleo Corp., Class A* | 4,400 | 99,132 | ||||||
Team, Inc.* | 1,500 | 67,455 | ||||||
TeleTech Holdings, Inc.* | 7,800 | 253,344 | ||||||
Tetra Technology, Inc.* | 13,200 | 284,460 | ||||||
United Stationers, Inc.* | 6,100 | 406,504 | ||||||
Viad Corp. | 4,100 | 172,897 | ||||||
Volt Information Sciences, Inc.* | 2,800 | 51,632 | ||||||
Waste Connections, Inc.* | 14,600 | 441,504 | ||||||
Waste Industries U.S.A., Inc. | 600 | 20,484 | ||||||
Waste Services, Inc.* | 3,900 | 47,385 | ||||||
Watson Wyatt Worldwide, Inc. | 8,200 | 413,936 | ||||||
13,326,537 | ||||||||
Communications Equipment (2.4%) | ||||||||
3COM Corp.* | 85,100 | 351,463 | ||||||
Acme Packet, Inc.* | 2,700 | 31,023 | ||||||
Adtran, Inc. | 13,200 | 342,804 | ||||||
Anaren, Inc.* | 4,200 | 73,962 | ||||||
Andrew Corp.* | 33,700 | 486,628 | ||||||
Arris Group, Inc.* | 22,000 | 386,980 | ||||||
Avanex Corp.* | 26,800 | 48,240 |
Common Stock (continued) | ||||||||
Shares or | ||||||||
Principal Amount | Value | |||||||
Communications Equipment (continued) | ||||||||
Avocent Corp.* | 11,200 | $ | 324,912 | |||||
Bel Fuse, Inc., Class B | 2,400 | 81,672 | ||||||
Bigband Networks, Inc.* | 1,100 | 14,421 | ||||||
Black Box Corp. | 3,500 | 144,830 | ||||||
C-COR, Inc.* | 10,400 | 146,224 | ||||||
Comtech Group, Inc.* | 3,500 | 57,785 | ||||||
Comtech Telecommunications Corp.* | 5,300 | 246,026 | ||||||
Digi International, Inc.* | 3,700 | 54,538 | ||||||
Ditech Networks, Inc.* | 6,300 | 51,597 | ||||||
Dycom Industries, Inc.* | 8,200 | 245,836 | ||||||
EMS Technologies* | 3,100 | 68,386 | ||||||
Extreme Networks, Inc.* | 25,600 | 103,680 | ||||||
Finisar Corp.* | 48,600 | 183,708 | ||||||
Foundry Networks, Inc.* | 29,200 | 486,472 | ||||||
Harmonic, Inc.* | 16,000 | 141,920 | ||||||
Harris Stratex Networks, Inc., Class A* | 4,300 | 77,314 | ||||||
Inter-Tel, Inc. | 4,500 | 107,685 | ||||||
Interactive Intelligence, Inc.* | 1,500 | 30,900 | ||||||
InterDigital Communications Corp.* | 10,300 | 331,351 | ||||||
Ixia* | 7,100 | 65,746 | ||||||
Loral Space & Communications, Inc.* | 1,900 | 93,632 | ||||||
MasTec, Inc.* | 6,900 | 109,158 | ||||||
MRV Communications, Inc.* | 25,600 | 83,200 | ||||||
Netgear, Inc.* | 7,600 | 275,500 | ||||||
Network Equipment Technologies, Inc.* | 3,100 | 29,574 | ||||||
Ntelos Holding Corp. | 5,200 | 143,728 | ||||||
Oplink Communications, Inc.* | 4,500 | 67,500 | ||||||
OpNext, Inc.* | 2,100 | 27,804 | ||||||
Optium Corp.* | 1,300 | 16,445 | ||||||
Orbcomm, Inc.* | 3,900 | 63,999 | ||||||
Packeteer, Inc.* | 9,500 | 74,195 | ||||||
Plantronics, Inc. | 9,700 | 254,334 | ||||||
Polycom, Inc.* | 18,500 | 621,600 | ||||||
Powerwave Technologies, Inc.* | 26,300 | 176,210 | ||||||
Seachange International, Inc.* | 3,100 | 24,056 | ||||||
Sirenza Microdevices, Inc.* | 7,900 | 93,773 | ||||||
Sonus Networks, Inc.* | 49,600 | 422,592 | ||||||
Sycamore Networks, Inc.* | 29,400 | 118,188 | ||||||
Symmetricom, Inc.* | 9,400 | 78,960 | ||||||
Tekelec* | 12,800 | 184,576 | ||||||
U.T. Starcom, Inc.* | 21,900 | 122,859 | ||||||
ViaSat, Inc.* | 4,900 | 157,290 | ||||||
7,925,276 | ||||||||
Computers & Peripherals (1.0%) | ||||||||
Adaptec, Inc.* | 24,200 | 92,202 | ||||||
Avid Technology, Inc.* | 8,900 | 314,615 | ||||||
Cray, Inc.* | 9,400 | 71,722 | ||||||
Electronics for Imaging, Inc.* | 12,600 | 355,572 | ||||||
Emulex Corp.* | 15,900 | 347,256 | ||||||
Gateway, Inc.* | 61,900 | 98,421 | ||||||
Hurco Co., Inc.* | 700 | 34,986 | ||||||
Hutchinson Technology, Inc.* | 6,400 | 120,384 | ||||||
Hypercom Corp.* | 14,100 | 83,331 | ||||||
Imation Corp. | 7,100 | 261,706 | ||||||
Immersion Corp.* | 6,900 | 103,362 | ||||||
Integral Systems, Inc. | 1,400 | 34,034 | ||||||
Intermec, Inc.* | 11,000 | 278,410 | ||||||
Komag, Inc.* | 6,500 | 207,285 | ||||||
LivePerson, Inc.* | 4,200 | 22,470 | ||||||
Palm, Inc.* | 20,900 | 334,609 | ||||||
Quantum Corp.* | 32,400 | 102,708 | ||||||
Rackable Systems, Inc.* | 7,500 | 92,700 | ||||||
Rimage Corp.* | 1,400 | 44,226 | ||||||
Silicon Graphics, Inc.* | 500 | 13,270 | ||||||
Smart Modular Technologies — KY* | 8,600 | 118,336 | ||||||
STEC, Inc.* | 3,300 | 21,219 | ||||||
Stratasys, Inc.* | 2,400 | 112,752 | ||||||
Synaptics, Inc.* | 5,700 | 204,003 | ||||||
3,469,579 | ||||||||
Construction & Engineering (0.9%) | ||||||||
Aecom Technology Corp.* | 7,000 | 173,670 | ||||||
Comfort Systems U.S.A., Inc. | 8,300 | 117,694 | ||||||
Emcor Group, Inc.* | 6,400 | 466,560 | ||||||
Granite Construction, Inc. | 7,300 | 468,514 | ||||||
Infrasource Services, Inc.* | 7,500 | 278,250 | ||||||
Insituform Technologies, Inc.* | 6,800 | 148,308 | ||||||
Integrated Electrical Services, Inc.* | 3,400 | 112,098 | ||||||
Perini Corp.* | 5,200 | 319,956 | ||||||
Walter Industries, Inc. | 9,600 | 278,016 | ||||||
Washington Group International, Inc.* | 5,900 | 472,059 | ||||||
2,835,125 | ||||||||
Construction Materials (0.2%) | ||||||||
Headwaters, Inc.* | 9,000 | 155,430 | ||||||
Michael Baker Corp.* | 2,100 | 78,015 | ||||||
Texas Industries, Inc. | 5,460 | 428,119 | ||||||
U.S. Concrete, Inc.* | 6,900 | 59,961 | ||||||
721,525 | ||||||||
NVIT Small Cap Index (Continued)
Common Stock (continued) | ||||||||
Shares or | ||||||||
Principal Amount | Value | |||||||
Consumer Finance (0.4%) | ||||||||
Advance America Cash Advance Centers, Inc. | 12,600 | $ | 223,524 | |||||
Advanta Corp., Class B | 7,350 | 228,879 | ||||||
Cash America International, Inc. | 6,200 | 245,830 | ||||||
CompuCredit Corp.* | 4,100 | 143,582 | ||||||
Credit Acceptance Corp* | 1,000 | 26,830 | ||||||
Dollar Financial Corp.* | 3,900 | 111,150 | ||||||
EZCORP, Inc., Class A* | 7,500 | 99,300 | ||||||
First Cash Financial Services, Inc.* | 6,100 | 142,984 | ||||||
Nelnet, Inc. | 2,500 | 61,100 | ||||||
Q.C. Holdings, Inc. | 200 | 3,000 | ||||||
World Acceptance Corp.* | 4,000 | 170,920 | ||||||
1,457,099 | ||||||||
Consumer Goods (0.4%) | ||||||||
1-800-Flowers.Com, Inc.* | 7,000 | 66,010 | ||||||
American Dairy, Inc.* | 200 | 3,732 | ||||||
CEC Entertainment, Inc.* | 5,800 | 204,160 | ||||||
Central Garden & Pet Co.* | 14,100 | 165,393 | ||||||
Helen of Troy Ltd. — BR* | 7,100 | 191,700 | ||||||
Jamba, Inc.* | 13,200 | 120,648 | ||||||
Jo-Ann Stores, Inc.* | 5,200 | 147,836 | ||||||
Nexcen Brands, Inc.* | 6,700 | 74,638 | ||||||
Tempur-Pedic International, Inc. | 15,600 | 404,040 | ||||||
1,378,157 | ||||||||
Containers & Packaging (0.5%) | ||||||||
AEP Industries* | 1,300 | 58,513 | ||||||
AptarGroup, Inc. | 14,300 | 508,508 | ||||||
Chesapeake Corp. | 4,000 | 50,280 | ||||||
Graphic Packaging Corp.* | 11,700 | 56,628 | ||||||
Greif, Inc. | 6,300 | 375,543 | ||||||
Myers Industries, Inc. | 5,700 | 126,027 | ||||||
Rock-Tenn Co. | 6,700 | 212,524 | ||||||
Silgan Holdings, Inc. | 5,000 | 276,400 | ||||||
1,664,423 | ||||||||
Distributors (0.2%) | ||||||||
Audiovox Corp.* | 3,400 | 44,098 | ||||||
Beijing Med-Pharm Corp.* | 7,400 | 78,958 | ||||||
Building Materials Holding Corp. | 5,900 | 83,721 | ||||||
Core-Mark Holding Co., Inc.* | 1,900 | 68,362 | ||||||
Keystone Automotive Industries, Inc.* | 3,300 | 136,521 | ||||||
MWI Veterinary Supply, Inc.* | 1,700 | 67,813 | ||||||
Scansource, Inc.* | 5,200 | 166,348 | ||||||
Source Interlink Cos., Inc.* | 11,300 | 56,274 | ||||||
702,095 | ||||||||
Diversified Consumer Services (1.2%) | ||||||||
Bright Horizons Family Solutions, Inc.* | 5,300 | 206,223 | ||||||
Capella Education Co.* | 1,600 | 73,648 | ||||||
Coinmach Service Corp. | 3,400 | 44,982 | ||||||
Coinstar, Inc.* | 5,800 | 182,584 | ||||||
Corinthian Colleges, Inc.* | 19,700 | 320,913 | ||||||
CPI Corp. | 700 | 48,650 | ||||||
DeVry, Inc. | 12,200 | 415,044 | ||||||
Home Solutions of America, Inc.* | 8,200 | 49,036 | ||||||
INVESTools, Inc.* | 12,700 | 126,492 | ||||||
Jackson Hewitt Tax Service, Inc. | 6,500 | 182,715 | ||||||
Matthews International Corp., Class A | 6,400 | 279,104 | ||||||
Premier Exhibitions, Inc.* | 7,200 | 113,472 | ||||||
Prepaid Depot, Inc.* | 2,200 | 141,482 | ||||||
Regis Corp. | 9,800 | 374,850 | ||||||
Sotheby’s Holdings, Inc. | 13,300 | 612,066 | ||||||
Stewart Enterprises, Inc., Class A | 22,900 | 178,391 | ||||||
Strayer Education, Inc. | 3,200 | 421,472 | ||||||
Universal Technical Institute, Inc.* | 4,500 | 114,255 | ||||||
Vertrue, Inc.* | 1,500 | 73,170 | ||||||
3,958,549 | ||||||||
Diversified Financial Services (0.7%) | ||||||||
Asset Acceptance Capital Corp. | 2,500 | 44,250 | ||||||
Assured Guaranty Ltd. — BR | 12,600 | 372,456 | ||||||
ASTA Funding, Inc. | 2,800 | 107,604 | ||||||
Compass Diversified Trust | 5,500 | 98,065 | ||||||
Encore Capital Group, Inc.* | 5,100 | 63,648 | ||||||
Epoch Holding Corp.* | 3,400 | 45,526 | ||||||
Financial Federal Corp. | 5,400 | 161,028 | ||||||
GFI Group, Inc.* | 3,200 | 231,936 | ||||||
Interactive Brokers Group, Inc., Class A* | 9,100 | 246,883 | ||||||
International Securities Exchange Holdings, Inc. | 7,500 | 490,125 | ||||||
Ladenburg Thalmann Financial* | 11,500 | 26,450 | ||||||
Newstar Financial, Inc.* | 1,200 | 17,076 | ||||||
Portfolio Recovery Associates, Inc. | 3,700 | 222,074 | ||||||
Primus Guaranty Ltd. — BR* | 6,700 | 71,824 | ||||||
Prospect Energy Corp. | 4,500 | 78,615 | ||||||
Resource America, Inc., Class A | 2,400 | 49,464 | ||||||
U.S. Global Investors, Inc, Class A | 3,200 | 72,544 | ||||||
W.P. Stewart & Co. Ltd. — BR | 1,600 | 17,424 | ||||||
2,416,992 | ||||||||
Common Stock (continued) | ||||||||
Shares or | ||||||||
Principal Amount | Value | |||||||
Diversified Telecommunication Services (0.9%) | ||||||||
Alaska Communications Systems Holdings, Inc. | 10,000 | $ | 158,400 | |||||
Aruba Networks, Inc.* | 400 | 8,040 | ||||||
Atlantic Tele-Network, Inc. | 2,300 | 65,872 | ||||||
Cbeyond, Inc.* | 3,700 | 142,487 | ||||||
Cincinnati Bell, Inc.* | 50,000 | 289,000 | ||||||
Cognet Communications Group, Inc.* | 9,300 | 277,791 | ||||||
CT Communications, Inc. | 4,100 | 125,091 | ||||||
Eschelon Telecom, Inc.* | 2,200 | 65,120 | ||||||
Fairpoint Communications, Inc. | 6,700 | 118,925 | ||||||
General Communication, Inc.* | 10,800 | 138,348 | ||||||
Globalstar, Inc.* | 3,400 | 35,190 | ||||||
Golden Telecom, Inc. | 3,200 | 176,032 | ||||||
IDT Corp. | 9,500 | 98,040 | ||||||
Iowa Telecommunications Services, Inc. | 7,400 | 168,202 | ||||||
North Pittsburgh Systems, Inc. | 4,400 | 93,500 | ||||||
PAETEC Holding Corp.* | 14,200 | 160,318 | ||||||
Premiere Global Services, Inc.* | 13,700 | 178,374 | ||||||
Shenandoah Telecommunications Co. | 900 | 45,747 | ||||||
SureWest Communications | 2,300 | 62,652 | ||||||
Time Warner Telecom, Inc.* | 30,400 | 611,040 | ||||||
Vonage Holdings Corp.* | 12,800 | 39,808 | ||||||
3,057,977 | ||||||||
Electric Utilities (0.9%) | ||||||||
Allete, Inc. | 5,200 | 244,660 | ||||||
Central Vermont Public Service | 1,800 | 67,824 | ||||||
Cleco Corp. | 12,900 | 316,050 | ||||||
El Paso Electric Co.* | 10,500 | 257,880 | ||||||
Empire District Electric Co. | 6,300 | 140,931 | ||||||
IDACORP, Inc. | 9,900 | 317,196 | ||||||
ITC Holdings Corp. | 7,800 | 316,914 | ||||||
MGE Energy, Inc. | 3,300 | 107,811 | ||||||
Otter Tail Co. | 5,300 | 169,971 | ||||||
Portland General Electric Co. | 6,200 | 170,128 | ||||||
UIL Holdings Corp. | 5,400 | 178,740 | ||||||
UniSource Energy Corp. | 7,400 | 243,386 | ||||||
Westar Energy, Inc. | 19,200 | 466,176 | ||||||
2,997,667 | ||||||||
Electrical Equipment (1.3%) | ||||||||
A.O. Smith Corp. | 4,200 | 167,538 | ||||||
Acuity Brands, Inc. | 9,100 | 548,548 | ||||||
American Superconductor Corp.* | 7,000 | 135,170 | ||||||
Baldor Electric Co. | 9,200 | 453,376 | ||||||
Belden CDT, Inc. | 9,100 | 503,685 | ||||||
Encore Wire Corp. | 5,600 | 164,864 | ||||||
Energy Conversion Devices, Inc.* | 8,000 | 246,560 | ||||||
EnerSys* | 6,000 | 109,800 | ||||||
Evergreen Solar, Inc.* | 17,800 | 165,540 | ||||||
Franklin Electric Co., Inc. | 3,900 | 184,002 | ||||||
FuelCell Energy, Inc.* | 14,400 | 114,048 | ||||||
Genlyte Group, Inc.* | 5,700 | 447,678 | ||||||
Graftech International Ltd.* | 20,100 | 338,484 | ||||||
Lamson & Sessions Co.* | 2,900 | 77,053 | ||||||
LSI Industries, Inc. | 4,900 | 87,710 | ||||||
Medis Technologies, Inc.* | 4,300 | 63,167 | ||||||
Powell Industries, Inc.* | 1,600 | 50,816 | ||||||
Power-One, Inc.* | 14,200 | 56,516 | ||||||
Preformed Line Products Co. | 1,000 | 48,010 | ||||||
Regal-Beloit Corp. | 6,500 | 302,510 | ||||||
Superior Essex, Inc.* | 4,100 | 153,135 | ||||||
Vicor Corp. | 2,800 | 37,044 | ||||||
4,455,254 | ||||||||
Electronic Equipment & Instruments (2.2%) | ||||||||
Acacia Research — Acacia Technologies* | 7,400 | 119,584 | ||||||
Aeroflex, Inc.* | 14,527 | 205,847 | ||||||
Agilysys, Inc. | 7,300 | 164,250 | ||||||
Anixter International, Inc.* | 6,400 | 481,344 | ||||||
Benchmark Electronics, Inc.* | 13,300 | 300,846 | ||||||
Brightpoint, Inc.* | 11,100 | 153,069 | ||||||
Checkpoint Systems, Inc.* | 8,000 | 202,000 | ||||||
Cogent Communications Group, Inc.* | 7,800 | 114,582 | ||||||
Cognex Corp. | 8,900 | 200,339 | ||||||
Coherent, Inc.* | 6,300 | 192,213 | ||||||
Color Kinetics, Inc.* | 3,600 | 120,276 | ||||||
CPI International, Inc.* | 200 | 3,966 | ||||||
CTS Corp. | 6,600 | 83,556 | ||||||
Daktronics, Inc. | 7,600 | 163,248 | ||||||
DTS, Inc.* | 3,700 | 80,549 | ||||||
Echelon Corp.* | 6,000 | 93,780 | ||||||
Electro Scientific Industries, Inc.* | 7,200 | 149,760 | ||||||
Excel Technology, Inc.* | 3,000 | 83,820 | ||||||
Faro Technologies, Inc.* | 2,200 | 70,092 | ||||||
FLIR Systems, Inc.* | 14,100 | 652,125 | ||||||
Insight Enterprises, Inc.* | 9,800 | 221,186 | ||||||
IPG Photonics Corp.* | 1,000 | 19,950 | ||||||
Itron, Inc.* | 6,470 | 504,272 | ||||||
Kemet Corp.* | 15,700 | 110,685 | ||||||
L-1 Identity Solutions, Inc.* | 12,000 | 245,400 |
NVIT Small Cap Index (Continued)
Common Stock (continued) | ||||||||
Shares or | ||||||||
Principal Amount | Value | |||||||
Electronic Equipment & Instruments (continued) | ||||||||
Littlefuse, Inc.* | 4,600 | $ | 155,342 | |||||
LoJack Corp.* | 3,900 | 86,931 | ||||||
Measurement Specialties, Inc.* | 2,200 | 52,096 | ||||||
Mercury Computer Systems, Inc.* | 4,500 | 54,900 | ||||||
Methode Electronics | 9,000 | 140,850 | ||||||
MTS Systems Corp. | 4,200 | 187,614 | ||||||
Multi-Fineline Electronix, Inc.* | 1,000 | 17,160 | ||||||
Newport Corp.* | 8,900 | 137,772 | ||||||
On2 Technologies, Inc.* | 30,100 | 90,300 | ||||||
OSI Systems, Inc.* | 3,200 | 87,520 | ||||||
Oyo Geospace Corp.* | 1,100 | 81,609 | ||||||
P.C. Connection, Inc.* | 100 | 1,324 | ||||||
Park Electrochemical Corp. | 4,200 | 118,356 | ||||||
Plexus Corp.* | 9,400 | 216,106 | ||||||
RadiSys Corp.* | 4,400 | 54,560 | ||||||
Rofin-Sinar Technologies, Inc.* | 3,100 | 213,900 | ||||||
Rogers Corp.* | 3,600 | 133,200 | ||||||
Stoneridge, Inc.* | 1,100 | 13,574 | ||||||
Synnex Corp.* | 2,000 | 41,220 | ||||||
Technitrol, Inc. | 7,300 | 209,291 | ||||||
TTM Technologies, Inc.* | 9,200 | 119,600 | ||||||
Universal Display Corp.* | 6,300 | 98,973 | ||||||
X-Rite, Inc. | 5,900 | 87,143 | ||||||
Zygo Corp.* | 2,800 | 40,012 | ||||||
7,176,092 | ||||||||
Energy Equipment & Services (1.8%) | ||||||||
Allis-Chalmers Energy, Inc.* | 4,600 | 105,754 | ||||||
Atwood Oceanics, Inc.* | 5,500 | 377,410 | ||||||
Basic Energy Services, Inc.* | 7,100 | 181,547 | ||||||
Bristow Group, Inc.* | 4,100 | 203,155 | ||||||
Bronco Drilling Co., Inc.* | 5,200 | 85,332 | ||||||
Cal Dive International, Inc.* | 2,600 | 43,238 | ||||||
Carbo Ceramics, Inc. | 4,100 | 179,621 | ||||||
Complete Production Services* | 7,400 | 191,290 | ||||||
Dawson Geophysical Co.* | 2,000 | 122,920 | ||||||
Drill-Quip, Inc.* | 4,700 | 211,265 | ||||||
ENGlobal Corp.* | 3,600 | 43,740 | ||||||
Exide Technologies* | 9,800 | 91,140 | ||||||
Grey Wolf, Inc.* | 41,200 | 339,488 | ||||||
Hanover Compressor Co.* | 18,700 | 445,995 | ||||||
Hercules Offshore, Inc.* | 5,300 | 171,614 | ||||||
Horizon Offshore, Inc.* | 5,500 | 105,600 | ||||||
Input/ Output, Inc.* | 14,000 | 218,540 | ||||||
Lufkin Industries | 3,000 | 193,650 | ||||||
Matrix Service Corp.* | 5,700 | 141,645 | ||||||
NATCO Group, Inc., Class A* | 3,500 | 161,140 | ||||||
Newpark Resources, Inc.* | 18,200 | 141,050 | ||||||
Oil States International, Inc.* | 9,500 | 392,730 | ||||||
Parker Drilling Co.* | 22,500 | 237,150 | ||||||
PHI, Inc.* | 3,800 | 113,202 | ||||||
Pioneer Drilling Co.* | 10,000 | 149,100 | ||||||
RPC Energy Services, Inc. | 6,500 | 110,760 | ||||||
Sulphco, Inc.* | 5,000 | 18,050 | ||||||
Superior Offshore International, Inc.* | 800 | 14,560 | ||||||
Superior Well Services, Inc.* | 3,200 | 81,312 | ||||||
T-3 Energy Services, Inc.* | 1,100 | 36,795 | ||||||
Trico Marine Services, Inc.* | 2,400 | 98,112 | ||||||
Union Drilling, Inc.* | 1,700 | 27,914 | ||||||
Universal Compression Holdings, Inc.* | 6,100 | 442,067 | ||||||
W-H Energy Services, Inc.* | 6,600 | 408,606 | ||||||
Willbros Group, Inc. — PA* | 4,500 | 133,560 | ||||||
6,019,052 | ||||||||
Food & Staples Retailing (1.0%) | ||||||||
Andersons, Inc. (The) | 3,800 | 172,254 | ||||||
Benihana, Inc.* | 1,200 | 24,000 | ||||||
Cal-Maine Foods, Inc. | 3,900 | 63,882 | ||||||
Carrols Restaurant Group, Inc.* | 800 | 12,200 | ||||||
Casey’s General Stores, Inc. | 10,300 | 280,778 | ||||||
Central European Distribution Corp.* | 7,200 | 249,264 | ||||||
Great Atlantic & Pacific Tea Co., Inc.* | 4,500 | 150,930 | ||||||
Ingles Markets, Inc., Class A | 2,900 | 99,905 | ||||||
Longs Drug Stores Corp. | 6,700 | 351,884 | ||||||
Nasch-Finch Co. | 3,200 | 158,400 | ||||||
Pantry, Inc.* | 4,600 | 212,060 | ||||||
Pathmark Stores, Inc.* | 8,800 | 114,048 | ||||||
Performance Food Group Co.* | 7,100 | 230,679 | ||||||
PriceSmart, Inc. | 1,700 | 42,041 | ||||||
Ruddick Corp. | 8,300 | 249,996 | ||||||
Spartan Stores, Inc. | 5,200 | 171,132 | ||||||
Topps Co., Inc. | 8,800 | 92,488 | ||||||
United Natural Foods, Inc.* | 9,700 | 257,826 | ||||||
Village Super Market, Inc., Class A | 600 | 28,686 | ||||||
Weis Markets, Inc. | 2,500 | 101,275 | ||||||
Wild Oats Markets, Inc.* | 6,700 | 112,292 | ||||||
Winn-Dixie Stores, Inc.* | 6,200 | 181,660 | ||||||
3,357,680 | ||||||||
Food Products (0.9%) | ||||||||
Alico, Inc. | 600 | 36,594 | ||||||
Chiquita Brands International, Inc.* | 9,400 | 178,224 |
Common Stock (continued) | ||||||||
Shares or | ||||||||
Principal Amount | Value | |||||||
Food Products (continued) | ||||||||
Farmer Brothers Co. | 500 | $ | 11,315 | |||||
Flowers Foods, Inc. | 10,300 | 343,608 | ||||||
Fresh Del Monte Produce, Inc. — KY | 4,500 | 112,725 | ||||||
Green Mountain Coffee, Inc.* | 1,500 | 118,110 | ||||||
Hain Celestial Group, Inc.* | 6,900 | 187,266 | ||||||
Imperial Sugar Co. | 2,400 | 73,896 | ||||||
J & J Snack Foods Corp. | 2,000 | 75,480 | ||||||
Lancaster Colony Corp. | 4,600 | 192,694 | ||||||
Lance, Inc. | 6,300 | 148,428 | ||||||
Maui Land & Pineapple Co., Inc.* | 900 | 33,057 | ||||||
Peet’s Coffee & Tea, Inc.* | 4,000 | 98,520 | ||||||
Pilgrim’s Pride Corp. | 7,900 | 301,543 | ||||||
Ralcorp Holding, Inc.* | 6,000 | 320,700 | ||||||
Reddy Ice Holdings, Inc. | 4,000 | 114,080 | ||||||
Sanderson Farms, Inc. | 4,000 | 180,080 | ||||||
Seaboard Corp. | 44 | 103,180 | ||||||
Tootsie Roll Industries, Inc. | 7,100 | 196,741 | ||||||
Treehouse Foods, Inc.* | 5,700 | 151,677 | ||||||
2,977,918 | ||||||||
Gas Distribution (0.1%) | ||||||||
Piedmont Natural Gas Co., Inc. | 15,100 | 372,215 | ||||||
Semco Energy, Inc.* | 2,900 | 22,533 | ||||||
394,748 | ||||||||
Gas Utilities (0.6%) | ||||||||
Cascade Natural Gas Corp. | 2,800 | 73,948 | ||||||
EnergySouth, Inc. | 1,700 | 86,700 | ||||||
Laclede Group, Inc. (The) | 4,000 | 127,520 | ||||||
New Jersey Resources Corp. | 6,100 | 311,222 | ||||||
NICOR, Inc. | 9,800 | 420,616 | ||||||
Northwest Natural Gas Co. | 6,100 | 281,759 | ||||||
South Jersey Industries, Inc. | 6,700 | 237,046 | ||||||
Southwest Gas Corp. | 7,600 | 256,956 | ||||||
WGL Holdings, Inc. | 9,800 | 319,872 | ||||||
2,115,639 | ||||||||
Health Care Equipment & Supplies (3.0%) | ||||||||
Abaxis, Inc.* | 4,600 | 95,956 | ||||||
ABIOMED, Inc.* | 5,500 | 59,290 | ||||||
Accuray, Inc.* | 2,200 | 48,796 | ||||||
Align Technology, Inc.* | 12,000 | 289,920 | ||||||
American Medical Systems Holdings, Inc.* | 15,900 | 286,836 | ||||||
Analogic Corp. | 3,200 | 235,232 | ||||||
Angiodynamics, Inc.* | 4,200 | 75,642 | ||||||
Arrow International, Inc. | 5,100 | 195,228 | ||||||
Arthrocare Corp.* | 6,300 | 276,633 | ||||||
Aspect Medical Systems, Inc.* | 4,900 | 73,304 | ||||||
Cantel Medical Corp.* | 900 | 15,309 | ||||||
Conceptus, Inc.* | 7,200 | 139,464 | ||||||
CONMED Corp.* | 6,800 | 199,104 | ||||||
Cutera, Inc.* | 1,900 | 47,348 | ||||||
Cyberonics, Inc.* | 4,500 | 75,690 | ||||||
Cynosure, Inc.* | 2,200 | 80,146 | ||||||
D.J. Orthopedics, Inc.* | 4,800 | 198,096 | ||||||
Datascope Corp. | 2,800 | 107,184 | ||||||
ev3, Inc.* | 2,100 | 35,448 | ||||||
Foxhollow Technologies* | 4,000 | 84,960 | ||||||
Greatbatch, Inc.* | 3,500 | 113,400 | ||||||
Haemonetics Corp.* | 5,900 | 310,399 | ||||||
Hansen Medical, Inc.* | 1,900 | 35,891 | ||||||
Hologic, Inc.* | 10,900 | 602,879 | ||||||
I-Flow Corp.* | 4,100 | 68,634 | ||||||
ICU Medical, Inc.* | 3,400 | 145,996 | ||||||
Immucor, Inc.* | 13,800 | 385,986 | ||||||
Integra LifeSciences Holdings* | 4,300 | 212,506 | ||||||
Invacare Corp. | 5,800 | 106,314 | ||||||
Inverness Medical Innovations, Inc.* | 8,900 | 454,078 | ||||||
Kensey Nash Corp.* | 2,400 | 64,344 | ||||||
Kyphon, Inc.* | 9,800 | 471,870 | ||||||
LifeCell Corp.* | 6,800 | 207,672 | ||||||
Matria Healthcare, Inc.* | 4,300 | 130,204 | ||||||
Medical Action Industries, Inc.* | 2,800 | 50,568 | ||||||
Mentor Corp. | 8,300 | 337,644 | ||||||
Meridian Bioscience, Inc. | 7,350 | 159,201 | ||||||
Merit Medical Systems, Inc.* | 5,300 | 63,388 | ||||||
Micrus Endovascular Corp.* | 4,000 | 98,400 | ||||||
Natus Medical, Inc.* | 5,800 | 92,336 | ||||||
Northstar Neuroscience, Inc.* | 2,200 | 25,586 | ||||||
Nuvasive, Inc.* | 7,000 | 189,070 | ||||||
NxStage Medical, Inc.* | 5,900 | 76,287 | ||||||
Orasure Technologies, Inc.* | 9,300 | 76,074 | ||||||
Palomar Medical Technologies, Inc.* | 3,700 | 128,427 | ||||||
PolyMedica Corp. | 5,200 | 212,420 | ||||||
Quidel Corp.* | 5,800 | 101,848 | ||||||
Sirona Dental Systems, Inc.* | 3,400 | 128,622 | ||||||
SonoSite, Inc.* | 3,700 | 116,291 | ||||||
Spectranetics Corp.* | 8,700 | 100,224 | ||||||
Stereotaxis, Inc.* | 4,600 | 60,076 | ||||||
Steris Corp. | 12,300 | 376,380 | ||||||
Surmodics, Inc.* | 3,800 | 190,000 | ||||||
Symmetry Medical, Inc.* | 6,700 | 107,267 | ||||||
Thoratec Corp.* | 12,100 | 222,519 | ||||||
Tomotherapy, Inc.* | 1,000 | 21,920 | ||||||
Ventana Medical Systems, Inc.* | 6,400 | 494,528 |
NVIT Small Cap Index (Continued)
Common Stock (continued) | ||||||||
Shares or | ||||||||
Principal Amount | Value | |||||||
Health Care Equipment & Supplies (continued) | ||||||||
Vital Signs, Inc. | 1,600 | $ | 88,880 | |||||
Volcano Corp.* | 3,700 | 74,777 | ||||||
West Pharmaceutical Services, Inc. | 6,600 | 311,190 | ||||||
Wright Medical Group, Inc.* | 7,000 | 168,840 | ||||||
Zoll Medical Corp.* | 4,200 | 93,702 | ||||||
10,096,224 | ||||||||
Health Care Providers & Services (2.2%) | ||||||||
Air Methods Corp.* | 2,700 | 99,009 | ||||||
Alliance Imaging, Inc.* | 2,500 | 23,475 | ||||||
Amedisys, Inc.* | 6,100 | 221,613 | ||||||
American Dental Partners* | 3,600 | 93,492 | ||||||
Amerigroup Corp.* | 10,700 | 254,660 | ||||||
AMN Healthcare Services, Inc.* | 7,000 | 154,000 | ||||||
Amsurg Corp.* | 6,200 | 149,668 | ||||||
Animal Health International, Inc.* | 800 | 11,592 | ||||||
Apria Healthcare Group, Inc.* | 8,800 | 253,176 | ||||||
Assisted Living Concepts, Inc.* | 9,600 | 102,240 | ||||||
Capital Senior Living Corp.* | 2,100 | 19,782 | ||||||
Centene Corp.* | 8,800 | 188,496 | ||||||
Chemed Corp. | 5,100 | 338,079 | ||||||
CorVel Corp.* | 1,900 | 49,666 | ||||||
Cross Country Healthcare, Inc.* | 6,700 | 111,756 | ||||||
CryoLife, Inc.* | 3,000 | 39,030 | ||||||
Emergency Medical Services* | 1,300 | 50,869 | ||||||
Emeritus Co.* | 500 | 15,490 | ||||||
Genesis HealthCare Corp.* | 4,000 | 273,680 | ||||||
Gentiva Health Services, Inc.* | 6,200 | 124,372 | ||||||
HealthExtras, Inc.* | 6,000 | 177,480 | ||||||
Healthsouth Corp.* | 17,000 | 307,870 | ||||||
Healthspring, Inc.* | 7,900 | 150,574 | ||||||
Healthways, Inc.* | 7,700 | 364,749 | ||||||
HMS Holdings Corp.* | 3,100 | 59,334 | ||||||
Hythiam, Inc.* | 8,800 | 76,120 | ||||||
InVentiv Health, Inc.* | 6,300 | 230,643 | ||||||
Kindred Healthcare, Inc.* | 6,100 | 187,392 | ||||||
Landauer, Inc. | 1,700 | 83,725 | ||||||
LCA-VISION, Inc. | 4,200 | 198,492 | ||||||
LHC Group, Inc.* | 2,900 | 75,980 | ||||||
Magellan Health Services, Inc.* | 7,900 | 367,113 | ||||||
Medcath Corp.* | 2,800 | 89,040 | ||||||
Molina Healthcare, Inc.* | 2,000 | 61,040 | ||||||
National Healthcare Corp. | 900 | 46,440 | ||||||
Nighthawk Radiology Holdings, Inc.* | 3,100 | 55,955 | ||||||
Odyssey Healthcare, Inc.* | 7,700 | 91,322 | ||||||
Option Care, Inc. | 6,500 | 100,100 | ||||||
Owens & Minor, Inc. | 8,600 | 300,484 | ||||||
Providence Service Corp.* | 2,600 | 69,472 | ||||||
PSS World Medical, Inc.* | 14,000 | 255,080 | ||||||
Psychiatric Solutions, Inc.* | 11,000 | 398,860 | ||||||
Radiation Therapy Services, Inc.* | 3,700 | 97,458 | ||||||
RehabCare Group, Inc.* | 3,500 | 49,840 | ||||||
Res-Care, Inc.* | 5,300 | 112,042 | ||||||
Skilled Healthcare Group, Inc.* | 6,200 | 96,162 | ||||||
Sun Healthcare Group, Inc.* | 10,200 | 147,798 | ||||||
Sunrise Senior Living, Inc.* | 9,000 | 359,910 | ||||||
Symbion, Inc.* | 3,100 | 67,301 | ||||||
Visicu, Inc.* | 4,000 | 36,600 | ||||||
7,288,521 | ||||||||
Health Care Technology (0.4%) | ||||||||
Allscripts Healthcare Solutions, Inc.* | 11,200 | 285,376 | ||||||
Computer Programs & Systems, Inc. | 2,300 | 71,254 | ||||||
Digene Corp.* | 3,900 | 234,195 | ||||||
Eclipsys Corp.* | 8,600 | 170,280 | ||||||
GTx, Inc.* | 2,200 | 35,618 | ||||||
Omicell, Inc.* | 6,100 | 126,758 | ||||||
Phase Forward* | 6,800 | 114,444 | ||||||
TriZetto Group, Inc. (The)* | 9,100 | 176,176 | ||||||
Vital Images, Inc.* | 3,200 | 86,912 | ||||||
1,301,013 | ||||||||
Hotels, Restaurants & Leisure (2.6%) | ||||||||
AFC Enterprises, Inc.* | 6,400 | 110,656 | ||||||
Ambassadors Group, Inc. | 4,100 | 145,673 | ||||||
Ameristar Casinos, Inc. | 6,000 | 208,440 | ||||||
Applebee’s International, Inc. | 16,400 | 395,240 | ||||||
Bally Technologies, Inc.* | 10,300 | 272,126 | ||||||
BJ’s Restaurants, Inc.* | 2,100 | 41,454 | ||||||
Bluegreen Corp.* | 2,500 | 29,225 | ||||||
Bob Evans Farms, Inc. | 7,300 | 269,005 | ||||||
Buffalo Wild Wings, Inc.* | 3,600 | 149,724 | ||||||
California Pizza Kitchen, Inc.* | 7,300 | 156,804 | ||||||
CBRL Group, Inc. | 5,700 | 242,136 | ||||||
Chipotle Mexican Grill, Inc.* | 6,200 | 487,506 | ||||||
Churchill Downs, Inc. | 1,300 | 68,094 | ||||||
CKE Restaurants, Inc. | 12,100 | 242,847 | ||||||
Denny’s Corp.* | 23,800 | 105,910 | ||||||
Domino’s Pizza, Inc. | 7,100 | 129,717 | ||||||
Dover Downs Gaming & Entertainment, Inc. | 3,200 | 48,032 | ||||||
Gaylord Entertainment Co.* | 8,100 | 434,484 | ||||||
Great Wolf Resorts, Inc.* | 4,200 | 59,850 | ||||||
IHOP Corp. | 3,300 | 179,619 | ||||||
Isle of Capri Casinos, Inc.* | 3,200 | 76,672 |
Common Stock (continued) | ||||||||
Shares or | ||||||||
Principal Amount | Value | |||||||
Hotels, Restaurants & Leisure (continued) | ||||||||
Jack in the Box, Inc.* | 6,320 | $ | 448,341 | |||||
Krispy Kreme Doughnuts, Inc.* | 13,100 | 121,306 | ||||||
Landry’s Restaurants, Inc. | 3,400 | 102,884 | ||||||
LIFE TIME FITNESS, Inc.* | 6,400 | 340,672 | ||||||
Lodgian, Inc.* | 3,000 | 45,090 | ||||||
Magna Entertainment Corp., Class A* | 8,100 | 23,652 | ||||||
Marcus Corp. | 3,100 | 73,656 | ||||||
McCormick & Schmick’s Seafood Restaurants, Inc.* | 1,700 | 44,098 | ||||||
Monarch Casino & Resort, Inc.* | 1,600 | 42,960 | ||||||
Morgans Hotel Group Co.* | 4,100 | 99,958 | ||||||
Morton’s Restaurant Group, Inc.* | 1,400 | 25,354 | ||||||
MTR Gaming Group, Inc.* | 4,100 | 63,140 | ||||||
Multimedia Games, Inc.* | 6,700 | 85,492 | ||||||
O’Charley’s, Inc. | 5,300 | 106,848 | ||||||
P.F. Chang’s China Bistro, Inc.* | 5,500 | 193,600 | ||||||
Papa John’s International, Inc.* | 5,500 | 158,180 | ||||||
Pinnacle Entertainment, Inc.* | 12,300 | 346,245 | ||||||
RARE Hospitality International, Inc.* | 7,400 | 198,098 | ||||||
Red Robin Gourmet Burgers* | 3,400 | 137,258 | ||||||
Riviera Holdings Corp.* | 1,500 | 54,525 | ||||||
Ruby Tuesday, Inc. | 11,000 | 289,630 | ||||||
Ruth’s Chris Steak House, Inc.* | 3,800 | 64,562 | ||||||
Shuffle Master, Inc.* | 8,400 | 139,440 | ||||||
Six Flags, Inc.* | 16,100 | 98,049 | ||||||
Sonic Corp.* | 14,900 | 329,588 | ||||||
Speedway Motorsports, Inc. | 2,500 | 99,950 | ||||||
Steak n Shake Co. (The)* | 4,500 | 75,105 | ||||||
Texas Roadhouse, Inc., Class A* | 10,600 | 135,574 | ||||||
Town Sports International Holdings, Inc.* | 2,600 | 50,232 | ||||||
Triarc Cos., Inc. | 12,000 | 188,400 | ||||||
Trump Entertainment Resorts, Inc.* | 7,700 | 96,635 | ||||||
Vail Resorts, Inc.* | 6,000 | 365,220 | ||||||
WMS Industries, Inc.* | 7,750 | 223,665 | ||||||
8,720,621 | ||||||||
Household Durables (1.0%) | ||||||||
American Greetings Corp., Class A | 11,200 | 317,296 | ||||||
Avatar Holdings* | 1,200 | 92,328 | ||||||
Beazer Homes U.S.A., Inc. | 7,100 | 175,157 | ||||||
Blyth Industries, Inc. | 5,400 | 143,532 | ||||||
Brookfield Homes Corp. | 2,500 | 72,725 | ||||||
Champion Enterprises, Inc.* | 15,500 | 152,365 | ||||||
CSS Industries, Inc. | 1,600 | 63,376 | ||||||
Ethan Allen Interiors, Inc. | 6,000 | 205,500 | ||||||
Furniture Brands International, Inc. | 9,800 | 139,160 | ||||||
Hooker Furniture Corp. | 2,200 | 49,368 | ||||||
Hovnanian Enterprises, Inc.* | 7,600 | 125,628 | ||||||
iRobot Corp.* | 1,900 | 37,715 | ||||||
Kimball International, Inc., Class B | 5,100 | 71,451 | ||||||
La-Z-Boy, Inc. | 9,300 | 106,578 | ||||||
Libbey, Inc. | 2,000 | 43,140 | ||||||
Lifetime Brands, Inc. | 3,300 | 67,485 | ||||||
M/I Homes, Inc. | 3,200 | 85,120 | ||||||
Meritage Corp.* | 5,300 | 141,775 | ||||||
National Presto Industries, Inc. | 900 | 56,106 | ||||||
Palm Harbor Homes, Inc.* | 2,000 | 28,300 | ||||||
Russ Berrie & Co., Inc.* | 3,100 | 57,753 | ||||||
Sealy Corp. | 7,000 | 115,640 | ||||||
Skyline Corp. | 1,800 | 54,018 | ||||||
Standard Pacific Corp. | 11,600 | 203,348 | ||||||
Syntax-Brillian Corp.* | 7,500 | 36,900 | ||||||
Tarragon Realty Investors, Inc.* | 1,200 | 10,152 | ||||||
Tupperware Corp. | 12,400 | 356,376 | ||||||
Universal Electronics, Inc.* | 2,900 | 105,328 | ||||||
WCI Communities, Inc.* | 7,000 | 116,760 | ||||||
3,230,380 | ||||||||
Household Products (0.1%) | ||||||||
Spectrum Brands, Inc.* | 9,900 | 67,023 | ||||||
WD-40 Co. | 3,600 | 118,332 | ||||||
185,355 | ||||||||
Independent Power Producers & Energy Traders (0.0%) | ||||||||
Ormat Technologies, Inc. | 1,900 | 71,592 | ||||||
71,592 | ||||||||
Industrial Conglomerates (0.1%) | ||||||||
Raven Industries, Inc. | 3,200 | 114,272 | ||||||
Sequa Corp., Class A* | 1,200 | 134,400 | ||||||
Standex International Corp. | 2,500 | 71,100 | ||||||
Tredegar Industries, Inc. | 5,800 | 123,540 | ||||||
443,312 | ||||||||
Insurance (3.3%) | ||||||||
21st Century Insurance Group | 7,000 | 153,020 | ||||||
Alfa Corp. | 5,000 | 77,850 | ||||||
American Equity Investment Life Holding Co. | 11,900 | 143,752 | ||||||
American Physicians Capital, Inc.* | 2,700 | 109,350 | ||||||
Amerisafe, Inc.* | 5,100 | 100,113 | ||||||
AmTrust Financial Services, Inc. | 6,700 | 125,893 | ||||||
Argonaut Group, Inc. | 6,800 | 212,228 | ||||||
Aspen Insurance Holdings Ltd. — BR | 18,000 | 505,260 |
NVIT Small Cap Index (Continued)
Common Stock (continued) | ||||||||
Shares or | ||||||||
Principal Amount | Value | |||||||
Insurance (continued) | ||||||||
Baldwin & Lyons, Inc., Class B | 1,600 | $ | 41,568 | |||||
Bristol West Holdings, Inc. | 2,100 | 46,977 | ||||||
Citizens, Inc.* | 11,400 | 80,256 | ||||||
CNA Surety Corp.* | 1,700 | 32,147 | ||||||
Commerce Group, Inc. | 11,700 | 406,224 | ||||||
Crawford & Co., Class B | 5,100 | 34,476 | ||||||
Darwin Professional Underwriters, Inc.* | 1,600 | 40,272 | ||||||
Delphi Financial Group, Inc., Class A | 8,800 | 368,016 | ||||||
Donegal Group, Inc., Class A | 1,200 | 17,880 | ||||||
eHealth, Inc.* | 3,800 | 72,542 | ||||||
EMC Insurance Group, Inc. | 1,200 | 29,784 | ||||||
Employers Holdings, Inc. | 10,800 | 229,392 | ||||||
Enstar Group Ltd.* | 1,100 | 132,781 | ||||||
FBL Financial Group, Inc., Class A | 2,100 | 82,572 | ||||||
First Acceptance Corp.* | 1,800 | 18,288 | ||||||
First Mercury Financial Corp.* | 4,000 | 83,880 | ||||||
Flagstone Reinsurance Holdings Ltd. — BR | 300 | 3,996 | ||||||
FPIC Insurance Group, Inc.* | 2,700 | 110,079 | ||||||
Great American Financial Resources, Inc. | 1,800 | 43,542 | ||||||
Greenlight Capital Ltd.* | 3,300 | 74,349 | ||||||
Harleysville Group, Inc. | 2,200 | 73,392 | ||||||
Hilb, Rogal & Hamilton Co. | 7,100 | 304,306 | ||||||
Horace Mann Educators Corp. | 9,500 | 201,780 | ||||||
Independence Holding Co. | 400 | 8,172 | ||||||
Infinity Property & Casualty Corp. | 3,900 | 197,847 | ||||||
IPC Holdings Ltd. — BR | 13,900 | 448,831 | ||||||
James River Group, Inc. | 2,100 | 69,783 | ||||||
Kansas City Life Insurance Co. | 200 | 9,304 | ||||||
LandAmerica Financial Group, Inc. | 3,500 | 337,715 | ||||||
Max Re Capital Ltd. | 13,300 | 376,390 | ||||||
Meadowbrook Insurance Group, Inc.* | 5,300 | 58,088 | ||||||
Midland Co. (The) | 2,000 | 93,880 | ||||||
Montpelier Re Holdings Ltd. — BR | 20,800 | 385,632 | ||||||
National Financial Partners Corp. | 7,600 | 351,956 | ||||||
National Interstate Corp. | 2,200 | 57,376 | ||||||
National Western Life Insurance Co., Class A | 300 | 75,876 | ||||||
Navigators Group, Inc. (The)* | 3,300 | 177,870 | ||||||
Nymagic, Inc. | 1,200 | 48,240 | ||||||
Odyssey Re Holdings Corp. | 5,000 | 214,450 | ||||||
Ohio Casualty Corp. | 12,900 | 558,699 | ||||||
Phoenix Co., Inc. | 23,000 | 345,230 | ||||||
Platinum Underwriters Holdings Ltd. — BR | 11,200 | 389,200 | ||||||
PMA Capital Corp., Class A* | 6,600 | 70,554 | ||||||
Presidential Life Corp. | 6,000 | 117,960 | ||||||
ProAssurance Corp.* | 6,700 | 372,989 | ||||||
PXRE Corp. — BR* | 6,000 | 27,840 | ||||||
Ram Holdings Ltd. — BR* | 1,800 | 28,350 | ||||||
RLI Corp. | 4,300 | 240,585 | ||||||
Safety Insurance Group, Inc. | 3,300 | 136,620 | ||||||
Scottish Re Group Ltd.* | 9,600 | 46,944 | ||||||
Seabright Insurance Holdings* | 6,000 | 104,880 | ||||||
Security Capital Assurance Ltd. | 3,700 | 114,219 | ||||||
Selective Insurance Group, Inc. | 12,300 | 330,624 | ||||||
State Auto Financial Corp. | 2,000 | 61,300 | ||||||
Stewart Information Services Corp. | 3,500 | 139,405 | ||||||
Tower Group, Inc. | 5,000 | 159,500 | ||||||
United America Indemnity Ltd.* | 3,700 | 92,019 | ||||||
United Fire & Casualty Corp. | 3,700 | 130,906 | ||||||
Universal American Financial Corp.* | 7,900 | 168,112 | ||||||
Zenith National Insurance Co. | 7,300 | 343,757 | ||||||
10,847,068 | ||||||||
Internet & Catalog Retail (0.6%) | ||||||||
1-800 Contacts, Inc.* | 400 | 9,384 | ||||||
Blue Nile, Inc.* | 3,100 | 187,240 | ||||||
FTD Group, Inc. | 2,100 | 38,661 | ||||||
Gaiam, Inc.* | 3,500 | 63,805 | ||||||
GSI Commerce, Inc.* | 5,000 | 113,550 | ||||||
Knot, Inc. (The)* | 6,600 | 133,254 | ||||||
Netflix, Inc.* | 9,500 | 184,205 | ||||||
Overstock.com, Inc.* | 3,300 | 60,291 | ||||||
PetMed Express, Inc.* | 5,700 | 73,188 | ||||||
Priceline.com, Inc.* | 7,300 | 501,802 | ||||||
Shutterfly, Inc.* | 2,000 | 43,100 | ||||||
Stamps.com, Inc.* | 5,100 | 70,278 | ||||||
Systemax, Inc. | 2,100 | 43,701 | ||||||
ValueVision International, Inc., Class A* | 6,200 | 70,184 | ||||||
VistaPrint Ltd. — BR* | 8,100 | 309,825 | ||||||
1,902,468 | ||||||||
Internet Software & Services (2.2%) | ||||||||
Ariba, Inc.* | 16,100 | 159,551 | ||||||
Art Technology Group, Inc.* | 19,900 | 52,934 | ||||||
Asiainfo Holdings, Inc.* | 4,100 | 39,770 | ||||||
Bankrate, Inc.* | 2,300 | 110,216 | ||||||
Blue Coat Systems, Inc.* | 2,800 | 138,656 | ||||||
CMGI, Inc.* | 99,900 | 194,805 | ||||||
CNET Networks, Inc.* | 33,500 | 274,365 | ||||||
Cybersource Corp.* | 4,700 | 56,682 |
Common Stock (continued) | ||||||||
Shares or | ||||||||
Principal Amount | Value | |||||||
Internet Software & Services (continued) | ||||||||
Dealertrack Holdings, Inc.* | 6,000 | $ | 221,040 | |||||
Digital River, Inc.* | 8,100 | 366,525 | ||||||
DivX, Inc.* | 3,800 | 57,000 | ||||||
EarthLink, Inc.* | 28,600 | 213,642 | ||||||
eCollege.com, Inc.* | 3,400 | 75,650 | ||||||
Equinix, Inc.* | 6,400 | 585,408 | ||||||
Global Crossing Ltd. — BR* | 5,900 | 111,392 | ||||||
Greenfield Online* | 6,000 | 95,460 | ||||||
Ibasis, Inc.* | 4,500 | 45,225 | ||||||
Imergent, Inc. | 1,600 | 39,136 | ||||||
Infospace, Inc. | 7,000 | 162,470 | ||||||
Internap Network Services* | 8,300 | 119,686 | ||||||
Internet Capital Group, Inc.* | 6,400 | 79,360 | ||||||
Interwoven, Inc.* | 8,900 | 124,956 | ||||||
iPass, Inc.* | 9,300 | 50,406 | ||||||
J2 Global Communications, Inc.* | 10,000 | 349,000 | ||||||
Keynote Systems, Inc.* | 1,300 | 21,320 | ||||||
Liquidity Services, Inc.* | 2,100 | 39,438 | ||||||
Loopnet, Inc.* | 4,400 | 102,652 | ||||||
Marchex, Inc., Class B | 4,100 | 66,912 | ||||||
NIC, Inc. | 4,600 | 31,464 | ||||||
Omniture, Inc.* | 6,700 | 153,564 | ||||||
Online Resources & Communications Corp.* | 7,500 | 82,350 | ||||||
Openwave Systems, Inc. | 17,300 | 108,298 | ||||||
Opsware, Inc.* | 20,000 | 190,200 | ||||||
Perficient, Inc.* | 5,900 | 122,130 | ||||||
RealNetworks, Inc. (b) (c)* | 20,600 | 168,302 | ||||||
S1 Corp.* | 13,800 | 110,262 | ||||||
Savvis, Inc.* | 5,500 | 272,305 | ||||||
Smith Micro Software, Inc.* | 6,000 | 90,360 | ||||||
Sohu.com, Inc.* | 5,500 | 175,945 | ||||||
SonicWALL, Inc.* | 11,600 | 99,644 | ||||||
Switch & Data, Inc.* | 2,000 | 38,380 | ||||||
Synchronoss Technologies, Inc.* | 3,000 | 88,020 | ||||||
Techtarget* | 100 | 1,285 | ||||||
Terremark Worldwide, Inc.* | 12,900 | 83,205 | ||||||
TheStreet.com, Inc. | 4,200 | 45,696 | ||||||
Travelzoo, Inc.* | 900 | 23,931 | ||||||
United Online, Inc. | 13,500 | 222,615 | ||||||
ValueClick, Inc.* | 20,200 | 595,092 | ||||||
Vignette Corp.* | 7,400 | 141,784 | ||||||
Visual Sciences, Inc.* | 4,100 | 63,427 | ||||||
Vocus, Inc.* | 3,500 | 87,885 | ||||||
Websense, Inc.* | 9,100 | 193,375 | ||||||
7,143,176 | ||||||||
IT Services (1.6%) | ||||||||
Authorize.Net Holdings, Inc.* | 7,100 | 127,019 | ||||||
Bearingpoint, Inc.* | 38,800 | 283,628 | ||||||
BISYS Group, Inc. (The)* | 24,500 | 289,835 | ||||||
CACI International, Inc., Class A* | 6,200 | 302,870 | ||||||
Cass Information Systems, Inc. | 400 | 14,504 | ||||||
Ciber, Inc.* | 11,000 | 89,980 | ||||||
Covansys Corp.* | 5,600 | 190,008 | ||||||
CSG Systems International, Inc.* | 10,000 | 265,100 | ||||||
eFunds Corp.* | 10,100 | 356,429 | ||||||
Enernoc, Inc.* | 200 | 7,626 | ||||||
Euronet Worldwide, Inc.* | 9,250 | 269,730 | ||||||
Exlservice Holdings, Inc.* | 3,500 | 65,590 | ||||||
Forrester Research, Inc.* | 3,000 | 84,390 | ||||||
Gartner, Inc. * | 13,900 | 341,801 | ||||||
Gevity HR, Inc. | 6,200 | 119,846 | ||||||
Global Cash Access, Inc.* | 6,900 | 110,538 | ||||||
Heartland Payment Systems, Inc. | 2,000 | 58,660 | ||||||
iGATE Corp.* | 1,800 | 14,436 | ||||||
Infocrossing, Inc.* | 6,000 | 110,820 | ||||||
infoUSA, Inc. | 5,600 | 57,232 | ||||||
Isilon Systems, Inc.* | 200 | 3,084 | ||||||
Lionbridge Technologies, Inc.* | 12,200 | 71,858 | ||||||
ManTech International Corp.* | 3,100 | 95,573 | ||||||
Maximus, Inc. | 4,400 | 190,872 | ||||||
MPS Group, Inc.* | 20,700 | 276,759 | ||||||
Ness Technologies, Inc.* | 6,500 | 84,565 | ||||||
Perot Systems Corp., Class A* | 16,400 | 279,456 | ||||||
RightNow Technologies, Inc.* | 3,600 | 59,076 | ||||||
Safeguard Scientifics, Inc.* | 18,800 | 52,828 | ||||||
Sapient Corp.* | 16,500 | 127,545 | ||||||
SI International, Inc.* | 3,500 | 115,570 | ||||||
SRA International, Inc.* | 7,400 | 186,924 | ||||||
Sykes Enterprises, Inc.* | 6,500 | 123,435 | ||||||
Syntel, Inc. | 2,400 | 72,936 | ||||||
TNS, Inc. | 5,500 | 79,255 | ||||||
Tyler Technologies, Inc.* | 7,900 | 98,039 | ||||||
Wright Express Corp.* | 7,500 | 257,025 | ||||||
5,334,842 | ||||||||
Leisure Equipment & Products (0.6%) | ||||||||
Arctic Cat, Inc. | 3,600 | 71,280 | ||||||
Callaway Golf Co. | 16,100 | 286,741 | ||||||
Gander Mountain Co.* | 2,700 | 30,645 | ||||||
JAKKS Pacific, Inc.* | 5,700 | 160,398 | ||||||
K2, Inc.* | 10,000 | 151,900 | ||||||
Leapfrog Enterprises, Inc.* | 5,800 | 59,450 | ||||||
Marine Products Corp. | 900 | 7,407 | ||||||
Marvel Entertainment, Inc.* | 9,800 | 249,704 |
NVIT Small Cap Index (Continued)
Common Stock (continued) | ||||||||
Shares or | ||||||||
Principal Amount | Value | |||||||
Leisure Equipment & Products (continued) | ||||||||
Nautilus Group, Inc. (The) | 8,200 | $ | 98,728 | |||||
Oakley, Inc. | 4,200 | 119,280 | ||||||
Polaris Industries, Inc. | 7,800 | 422,448 | ||||||
RC2 Corp.* | 4,200 | 168,042 | ||||||
Smith & Wesson Holding Corp.* | 6,600 | 110,550 | ||||||
Steinway Musical Instruments, Inc. | 1,600 | 55,344 | ||||||
Sturm Ruger & Co., Inc.* | 3,000 | 46,560 | ||||||
2,038,477 | ||||||||
Life Sciences Tools & Services (0.8%) | ||||||||
Advanced Magnetics, Inc.* | 2,500 | 145,400 | ||||||
Affymetrix, Inc.* | 14,000 | 348,460 | ||||||
Albany Molecular Research* | 6,400 | 95,040 | ||||||
Bruker Bioscience Corp.* | 10,700 | 96,407 | ||||||
Dionex Corp.* | 3,800 | 269,762 | ||||||
Enzo Biochem, Inc.* | 5,300 | 79,235 | ||||||
Eresearch Technology, Inc.* | 8,400 | 79,884 | ||||||
Illumina, Inc.* | 10,800 | 438,372 | ||||||
Kendle International, Inc.* | 2,800 | 102,956 | ||||||
Luminex Corp.* | 5,400 | 66,474 | ||||||
PAREXEL International Corp.* | 6,400 | 269,184 | ||||||
Pharmanet Development Group, Inc.* | 3,800 | 121,144 | ||||||
PRA International* | 4,000 | 101,200 | ||||||
Valhi, Inc. | 1,400 | 22,820 | ||||||
Varian, Inc.* | 6,800 | 372,844 | ||||||
Verenium Corp.* | 6,900 | 34,983 | ||||||
2,644,165 | ||||||||
Machinery (2.6%) | ||||||||
3D Systems Corp.* | 4,000 | 99,480 | ||||||
Accuride Corp.* | 3,500 | 53,935 | ||||||
Actuant Corp. | 5,500 | 346,830 | ||||||
Albany International Corp., Class A | 5,600 | 226,464 | ||||||
Altra Holdings, Inc.* | 600 | 10,368 | ||||||
American Railcar Industries, Inc. | 1,300 | 50,700 | ||||||
American Science & Engineering, Inc.* | 1,800 | 102,330 | ||||||
Ampco-Pittsburgh Corp. | 1,500 | 60,135 | ||||||
Astec Industries, Inc.* | 3,800 | 160,436 | ||||||
ASV, Inc.* | 4,100 | 70,848 | ||||||
Badger Meter, Inc. | 2,600 | 73,476 | ||||||
Barnes Group, Inc. | 9,300 | 294,624 | ||||||
Briggs & Stratton Corp. | 10,300 | 325,068 | ||||||
Bucyrus International, Inc., Class A | 7,200 | 509,616 | ||||||
Cascade Corp. | 2,400 | 188,256 | ||||||
Chart Industries, Inc.* | 3,600 | 102,384 | ||||||
Circor International, Inc. | 2,500 | 101,075 | ||||||
Clarcor, Inc. | 11,300 | 422,959 | ||||||
Columbus McKinnon Corp.* | 4,100 | 132,020 | ||||||
Commercial Vehicle Group, Inc.* | 3,000 | 55,890 | ||||||
Dynamic Materials Corp. | 2,400 | 90,000 | ||||||
Enpro Industries, Inc.* | 3,900 | 166,881 | ||||||
ESCO Technologies, Inc.* | 5,500 | 199,430 | ||||||
Federal Signal Corp. | 9,700 | 153,842 | ||||||
Flow International Corp.* | 5,500 | 69,300 | ||||||
Force Protection, Inc.* | 12,900 | 266,256 | ||||||
Freightcar America, Inc. | 2,700 | 129,168 | ||||||
Gehl Co.* | 2,600 | 78,936 | ||||||
Gorman-Rupp | 2,300 | 73,278 | ||||||
Greenbrier Cos., Inc. | 3,600 | 108,792 | ||||||
Hardinge, Inc. | 1,600 | 54,448 | ||||||
Kadant, Inc.* | 3,100 | 96,720 | ||||||
Kaydon Corp. | 6,300 | 328,356 | ||||||
Lindsay Manufacturing Co. | 3,000 | 132,870 | ||||||
Middleby Corp.* | 2,800 | 167,496 | ||||||
Miller Industries, Inc.* | 1,900 | 47,690 | ||||||
Mueller Industries, Inc. | 7,900 | 272,076 | ||||||
Mueller Water Products, Inc., Class A | 25,000 | 426,500 | ||||||
NACCO Industries, Inc., Class A | 1,000 | 155,490 | ||||||
Nordson Corp. | 6,800 | 341,088 | ||||||
RBC Bearings, Inc.* | 4,300 | 177,375 | ||||||
Robbins & Myers, Inc. | 2,800 | 148,764 | ||||||
Sun Hydraulics Corp. | 2,000 | 98,500 | ||||||
Tecumseh Products Co.* | 4,500 | 70,695 | ||||||
Tennant Co. | 3,400 | 124,100 | ||||||
Titan International, Inc. | 4,100 | 129,601 | ||||||
Trimas Corp.* | 200 | 2,416 | ||||||
TurboChef Technologies, Inc.* | 5,700 | 79,344 | ||||||
Twin Disc, Inc. | 700 | 50,337 | ||||||
Valmont Industries, Inc. | 3,400 | 247,384 | ||||||
Wabash National Corp. | 6,200 | 90,706 | ||||||
Wabtec Corp. | 9,200 | 336,076 | ||||||
Watts Industries, Inc. | 6,300 | 236,061 | ||||||
8,536,870 | ||||||||
Manufacturing (0.3%) | ||||||||
AZZ, Inc.* | 1,600 | 53,840 | ||||||
Blount International, Inc.* | 9,500 | 124,260 | ||||||
Coleman Cable, Inc.* | 2,500 | 64,650 | ||||||
Darling International, Inc.* | 17,900 | 163,606 | ||||||
Gerber Scientific, Inc.* | 4,700 | 54,614 | ||||||
II-VI, Inc* | 4,800 | 130,416 | ||||||
L.B. Foster Co.* | 2,900 | 83,172 |
Common Stock (continued) | ||||||||
Shares or | ||||||||
Principal Amount | Value | |||||||
Manufacturing (continued) | ||||||||
Park-Ohio Holdings Corp.* | 2,600 | $ | 70,980 | |||||
Woodward Governor Co. | 5,500 | 295,185 | ||||||
1,040,723 | ||||||||
Marine (0.4%) | ||||||||
American Commercial Lines, Inc.* | 12,600 | 328,230 | ||||||
Arlington Tankers Ltd. | 1,500 | 43,020 | ||||||
Double Hull Tankers, Inc. — MH | 4,900 | 76,391 | ||||||
Eagle Bulk Shipping, Inc. | 9,900 | 221,859 | ||||||
Genco Shipping & Trading Ltd. — MH | 2,800 | 115,528 | ||||||
General Maritime Corp. — MH | 4,600 | 123,188 | ||||||
Nordic American Tanker Shipping Ltd. — BR | 4,600 | 187,864 | ||||||
Ship Finance International — BR | 5,300 | 157,304 | ||||||
TBS International Ltd. — BR* | 1,900 | 53,960 | ||||||
Ultrapetrol Bahamas Ltd. — BS* | 2,100 | 49,770 | ||||||
1,357,114 | ||||||||
Media (1.9%) | ||||||||
Arbitron, Inc. | 6,000 | 309,180 | ||||||
Belo Corp., Class A | 17,100 | 352,089 | ||||||
Carmike Cinemas, Inc. | 3,200 | 70,272 | ||||||
Catalina Marketing Corp. | 8,400 | 264,600 | ||||||
Charter Communications, Inc.* | 82,500 | 334,125 | ||||||
Cinemark Holdings, Inc.* | 3,900 | 69,771 | ||||||
Citadel Broadcasting Co. | 48,370 | 311,986 | ||||||
CKX, Inc.* | 8,300 | 114,706 | ||||||
Courier Corp. | 1,900 | 76,000 | ||||||
Cox Radio, Inc.* | 6,700 | 95,408 | ||||||
Crown Media Holdings, Inc.* | 3,300 | 23,760 | ||||||
Cumulus Media, Inc.* | 9,200 | 86,020 | ||||||
D.G. Fastchannel, Inc.* | 3,700 | 75,406 | ||||||
Emmis Communications Corp. | 9,300 | 85,653 | ||||||
Entercom Communications Corp. | 6,600 | 164,274 | ||||||
Entravision Communications Corp.* | 13,000 | 135,590 | ||||||
Fisher Cos., Inc.* | 1,100 | 55,869 | ||||||
GateHouse Media, Inc. | 3,000 | 55,650 | ||||||
Gemstar-TV Guide International, Inc.* | 50,600 | 248,952 | ||||||
Gray Television, Inc. | 8,500 | 78,795 | ||||||
Harris Interactive, Inc.* | 11,000 | 58,850 | ||||||
Interactive Data Corp. | 6,100 | 163,358 | ||||||
Journal Communications, Inc. | 8,800 | 114,488 | ||||||
Knology, Inc.* | 4,000 | 69,480 | ||||||
Lakes Entertainment, Inc.* | 5,400 | 63,774 | ||||||
Lee Enterprises, Inc. | 10,400 | 216,944 | ||||||
Lin TV Corp., Class A* | 5,500 | 103,455 | ||||||
Live Nation, Inc.* | 13,200 | 295,416 | ||||||
LodgeNet Entertainment Corp.* | 4,600 | 147,476 | ||||||
Martha Stewart Living Omnimedia, Inc. | 5,400 | 92,880 | ||||||
Media General, Inc. | 4,500 | 149,715 | ||||||
Mediacom Communications Corp.* | 12,900 | 125,001 | ||||||
Morningstar, Inc.* | 2,300 | 108,158 | ||||||
National Cinemedia, Inc.* | 8,400 | 235,284 | ||||||
Nexstar Broadcasting Group, Inc.* | 600 | 7,884 | ||||||
Playboy Enterprises, Inc.* | 5,200 | 58,916 | ||||||
PRIMEDIA, Inc.* | 46,100 | 131,385 | ||||||
Radio One, Inc.* | 15,400 | 108,724 | ||||||
RCN Corp. | 5,900 | 110,861 | ||||||
Salem Communications Corp., Class A* | 1,600 | 17,744 | ||||||
Scholastic Corp.* | 7,900 | 283,926 | ||||||
Sinclair Broadcast Group, Inc. | 9,900 | 140,778 | ||||||
Spanish Broadcasting System, Inc.* | 9,300 | 39,990 | ||||||
Sun-Times Media Group, Inc. | 16,500 | 86,625 | ||||||
TiVo, Inc.* | 19,700 | 114,063 | ||||||
Valassis Communications, Inc.* | 9,700 | 166,743 | ||||||
Westwood One, Inc. | 14,100 | 101,379 | ||||||
World Wrestling Federation Entertainment, Inc. | 4,600 | 73,554 | ||||||
6,394,957 | ||||||||
Metals & Mining (1.4%) | ||||||||
A.M. Castle & Co. | 1,600 | 57,456 | ||||||
AMCOL International Corp. | 4,500 | 122,895 | ||||||
Apex Silver Mines Ltd.* | 10,800 | 217,944 | ||||||
Brush Engineered Materials, Inc.* | 3,900 | 163,761 | ||||||
Century Aluminum Co.* | 5,000 | 273,150 | ||||||
Claymont Steel Holdings, Inc.* | 600 | 12,834 | ||||||
Coeur d’Alene Mines Corp.* | 62,000 | 222,580 | ||||||
Compass Minerals International, Inc. | 6,500 | 225,290 | ||||||
Gibraltar Industries, Inc. | 5,100 | 112,965 | ||||||
Haynes International, Inc.* | 2,100 | 177,303 | ||||||
Hecla Mining Co.* | 25,200 | 215,208 | ||||||
Idaho General Mines, Inc.* | 13,000 | 82,420 | ||||||
Kaiser Aluminum Corp. | 2,800 | 204,064 | ||||||
Metal Management, Inc. | 5,200 | 229,164 | ||||||
Northwest Pipe Co.* | 2,700 | 96,039 | ||||||
Oilsands Quest, Inc.* | 14,000 | 34,580 | ||||||
Olympic Steel, Inc. | 1,800 | 51,588 | ||||||
Quanex Corp. | 7,500 | 365,250 | ||||||
Royal Gold, Inc. | 6,200 | 147,374 | ||||||
RTI International Metals, Inc.* | 4,700 | 354,239 |
NVIT Small Cap Index (Continued)
Common Stock (continued) | ||||||||
Shares or | ||||||||
Principal Amount | Value | |||||||
Metals & Mining (continued) | ||||||||
Ryerson, Inc. | 5,500 | $ | 207,075 | |||||
Schnitzer Steel Industries, Inc. | 5,000 | 239,700 | ||||||
Stillwater Metals & Mining Co.* | 8,000 | 88,080 | ||||||
U.S. Gold Corp.* | 8,300 | 45,650 | ||||||
Universal Stainless & Alloy Products, Inc.* | 1,900 | 66,937 | ||||||
Uranium Resources, Inc.* | 12,500 | 137,875 | ||||||
Wheeling-Pittsburgh Corp.* | 2,600 | 49,478 | ||||||
Worthington Industries, Inc. | 14,500 | 313,925 | ||||||
4,514,824 | ||||||||
Multi-Utilities (0.5%) | ||||||||
Aquila, Inc.* | 71,300 | 291,617 | ||||||
Avista Corp. | 10,700 | 230,585 | ||||||
Black Hills Corp. | 7,600 | 302,100 | ||||||
C.H. Energy Group, Inc. | 3,200 | 143,904 | ||||||
Northwestern Corp. | 6,700 | 213,127 | ||||||
PNM, Inc. | 15,900 | 441,861 | ||||||
1,623,194 | ||||||||
Multiline Retail (0.2%) | ||||||||
99 Cents Only Stores* | 9,500 | 124,545 | ||||||
Bon-Ton Stores, Inc. | 1,600 | 64,096 | ||||||
Conn’s, Inc.* | 1,700 | 48,552 | ||||||
Fred’s, Inc. | 8,700 | 116,406 | ||||||
Retail Ventures, Inc.* | 4,000 | 64,520 | ||||||
Tuesday Morning Corp. | 6,100 | 75,396 | ||||||
493,515 | ||||||||
Oil, Gas & Consumable Fuels (2.8%) | ||||||||
Alon U.S.A. Energy, Inc. | 2,600 | 114,426 | ||||||
Alpha Natural Resources, Inc.* | 11,900 | 247,401 | ||||||
Apco Argentina, Inc. — KY | 100 | 8,491 | ||||||
Arena Resources, Inc.* | 2,700 | 156,897 | ||||||
Atlas America, Inc. | 4,600 | 247,158 | ||||||
ATP Oil & Gas Corp.* | 5,000 | 243,200 | ||||||
Aventine Renewable Energy Holdings, Inc.* | 6,100 | 103,517 | ||||||
Berry Petroleum Co. | 8,000 | 301,440 | ||||||
Bill Barrett Corp.* | 5,400 | 198,882 | ||||||
Bois d’Arc Energy, Inc.* | 1,800 | 30,654 | ||||||
BPZ Energy, Inc.* | 13,000 | 72,540 | ||||||
Brigham Exploration Co.* | 9,200 | 54,004 | ||||||
Callon Petroleum Corp.* | 4,200 | 59,514 | ||||||
Carrizo Oil & Gas, Inc.* | 5,300 | 219,791 | ||||||
Clayton Williams Energy, Inc.* | 1,100 | 29,117 | ||||||
Clean Energy Fuel Corp.* | 4,200 | 52,752 | ||||||
Comstock Resources, Inc.* | 8,800 | 263,736 | ||||||
Contango Oil & Gas Co.* | 3,200 | 116,128 | ||||||
Crosstex Energy, Inc. | 7,400 | 212,602 | ||||||
Delek U.S. Holdings, Inc. | 1,400 | 37,310 | ||||||
Delta Petroleum Corp.* | 13,900 | 279,112 | ||||||
Edge Petroleum Corp.* | 6,700 | 93,867 | ||||||
Encore Acquisition Co.* | 10,700 | 297,460 | ||||||
Energy Infrastructure Acquisition Corp.* | 5,200 | 50,752 | ||||||
Energy Partners Ltd.* | 7,282 | 121,537 | ||||||
Evergreen Energy, Inc.* | 14,600 | 88,038 | ||||||
EXCO Resources, Inc.* | 10,800 | 188,352 | ||||||
F.X. Energy, Inc.* | 9,400 | 86,010 | ||||||
Geoglobal Resources, Inc.* | 5,300 | 26,977 | ||||||
Geokinetics, Inc.* | 2,100 | 65,163 | ||||||
Geomet, Inc.* | 600 | 4,596 | ||||||
GMX Resources, Inc.* | 2,100 | 72,660 | ||||||
Goodrich Petroleum Corp.* | 3,100 | 107,353 | ||||||
Gulf Island Fabrication, Inc. | 3,000 | 104,100 | ||||||
Gulfport Energy Corp.* | 5,300 | 105,894 | ||||||
Harvest Natural Resources, Inc.* | 7,900 | 94,089 | ||||||
Hornbeck Offshore Services, Inc.* | 5,300 | 205,428 | ||||||
International Coal Group, Inc* | 22,300 | 133,354 | ||||||
Mariner Energy, Inc.* | 16,300 | 395,275 | ||||||
Markwest Hydrocarbon, Inc. | 1,800 | 103,374 | ||||||
McMoRan Exploration Co.* | 5,700 | 79,800 | ||||||
Meridian Resource Corp. (The)* | 18,000 | 54,360 | ||||||
NGP Capital Resources Co. | 5,400 | 90,288 | ||||||
Nova Biosource Fuels, Inc.* | 1,100 | 2,805 | ||||||
Pacific Ethanol, Inc.* | 7,000 | 92,400 | ||||||
Parallel Petroleum Corp.* | 7,700 | 168,630 | ||||||
Penn Virginia Corp. | 7,600 | 305,520 | ||||||
Petrohawk Energy Corp.* | 32,400 | 513,864 | ||||||
Petroleum Development Corp.* | 3,600 | 170,928 | ||||||
Petroquest Energy, Inc.* | 8,400 | 122,136 | ||||||
Rentech, Inc.* | 41,400 | 107,226 | ||||||
Rossetta Resources, Inc.* | 10,300 | 221,862 | ||||||
Star Maritime Acquisition Corp.* | 4,900 | 60,074 | ||||||
Stone Energy Corp.* | 4,900 | 167,874 | ||||||
Swift Energy Co.* | 6,000 | 256,560 | ||||||
Toreador Resources Corp.* | 4,400 | 66,000 | ||||||
TXCO Resources, Inc.* | 8,300 | 85,324 | ||||||
U.S. Bioenergy Corp.* | 4,300 | 48,848 | ||||||
USEC, Inc.* | 16,900 | 371,462 | ||||||
Vaalco Energy, Inc.* | 11,900 | 57,477 | ||||||
Venoco, Inc.* | 1,000 | 18,670 | ||||||
Verasun Energy Corp.* | 5,100 | 73,848 | ||||||
Warren Resources, Inc.* | 12,000 | 140,160 |
Common Stock (continued) | ||||||||
Shares or | ||||||||
Principal Amount | Value | |||||||
Oil, Gas & Consumable Fuels (continued) | ||||||||
Whiting Petroleum Corp.* | 6,900 | $ | 279,588 | |||||
World Fuel Services Corp. | 5,500 | 231,330 | ||||||
9,179,985 | ||||||||
Other Financial (0.1%) | ||||||||
Information Services Group, Inc.* | 2,800 | 21,420 | ||||||
Kayne Anderson Energy Development | 1,200 | 30,216 | ||||||
Marathon Acquisition Corp.* | 7,200 | 56,736 | ||||||
NTR Acquisition Co.* | 1,800 | 17,046 | ||||||
Patriot Capitol Funding, Inc. | 5,900 | 87,615 | ||||||
Pennantpark Investment Corp. | 5,900 | 82,836 | ||||||
Pinnacle Financial Partners, Inc.* | 3,100 | 91,016 | ||||||
386,885 | ||||||||
Paper & Forest Products (0.3%) | ||||||||
Bowater, Inc. | 11,400 | 284,430 | ||||||
Buckeye Technologies, Inc.* | 5,800 | 89,726 | ||||||
Deltic Timber Corp. | 2,100 | 115,122 | ||||||
Glatfelter Co. | 9,100 | 123,669 | ||||||
Mercer International, Inc.* | 6,400 | 65,280 | ||||||
Neenah Paper, Inc. | 3,700 | 152,662 | ||||||
Schweitzer-Mauduit International, Inc. | 3,200 | 99,200 | ||||||
Wausau-Mosinee Paper Corp. | 9,000 | 120,600 | ||||||
1,050,689 | ||||||||
Personal Products (0.3%) | ||||||||
American Oriental Bioengineering, Inc.* | 9,400 | 83,660 | ||||||
Chattem, Inc.* | 3,900 | 247,182 | ||||||
Elizabeth Arden, Inc.* | 5,700 | 138,282 | ||||||
Inter Parfums, Inc. | 1,700 | 45,254 | ||||||
Mannatech, Inc. | 4,600 | 73,094 | ||||||
Nu Skin Enterprises, Inc. | 10,200 | 168,300 | ||||||
Playtex Products, Inc.* | 9,700 | 143,657 | ||||||
Prestige Brands Holdings, Inc.* | 4,900 | 63,602 | ||||||
Revlon Co., Inc.* | 45,000 | 61,650 | ||||||
USANA Health Sciences, Inc.* | 2,200 | 98,428 | ||||||
1,123,109 | ||||||||
Pharmaceuticals (2.4%) | ||||||||
Acadia Pharmaceuticals, Inc.* | 7,700 | 105,259 | ||||||
Adams Respiratory Therapeutics, Inc.* | 6,700 | 263,913 | ||||||
Akorn, Inc.* | 14,400 | 100,656 | ||||||
Alexion Pharmaceuticals, Inc.* | 7,900 | 355,974 | ||||||
Alexza Pharmaceuticals, Inc.* | 1,800 | 14,886 | ||||||
Allos Therapeutics, Inc.* | 12,400 | 54,808 | ||||||
Alnylam Pharmaceuticals, Inc.* | 6,500 | 98,735 | ||||||
Alpharma, Inc., Class A | 8,800 | 228,888 | ||||||
Altus Pharmaceuticals, Inc.* | 2,500 | 28,850 | ||||||
Arena Pharmaceuticals, Inc.* | 14,300 | 157,157 | ||||||
Auxilium Pharmaceuticals, Inc.* | 5,300 | 84,482 | ||||||
Bentley Pharmaceuticals, Inc.* | 2,800 | 33,992 | ||||||
Biomarin Pharmaceutical, Inc.* | 20,800 | 373,152 | ||||||
Bionovo, Inc.* | 4,000 | 15,440 | ||||||
Bradley Pharmaceutical* | 2,600 | 56,446 | ||||||
Cadence Pharmaceuticals, Inc.* | 1,600 | 19,408 | ||||||
Caraco Pharmaceutical Laboratories Ltd.* | 700 | 10,626 | ||||||
Cubist Pharmaceuticals, Inc.* | 12,300 | 242,433 | ||||||
Cypress Bioscience, Inc.* | 8,000 | 106,080 | ||||||
Discovery Laboratories, Inc.* | 10,900 | 30,847 | ||||||
Durect Corp.* | 10,700 | 41,195 | ||||||
Encysive Pharmaceuticals, Inc.* | 15,200 | 27,056 | ||||||
Enzon Pharmaceuticals, Inc.* | 12,600 | 98,910 | ||||||
Idenix Pharmaceuticals, Inc.* | 3,000 | 17,700 | ||||||
Indevus Pharmaceuticals, Inc.* | 15,400 | 103,642 | ||||||
Isis Pharmaceuticals, Inc.* | 19,100 | 184,888 | ||||||
Javelin Pharmaceuticals, Inc.* | 5,300 | 32,807 | ||||||
K-V Pharmaceutical Co.* | 7,100 | 193,404 | ||||||
Keryx Biopharmaceuticals, Inc.* | 8,300 | 81,091 | ||||||
Ligand Pharmaceutical, Class B | 15,200 | 104,576 | ||||||
Medicines Co. (The)* | 10,300 | 181,486 | ||||||
Medicis Pharmaceutical Corp. | 11,300 | 345,102 | ||||||
MGI Pharma, Inc.* | 15,800 | 353,446 | ||||||
Minrad International, Inc.* | 13,800 | 81,834 | ||||||
Momenta Pharmaceuticals, Inc.* | 4,800 | 48,384 | ||||||
Nabi Biopharmaceuticals* | 12,200 | 56,120 | ||||||
Nastech Pharmaceutical Co., Inc.* | 5,100 | 55,641 | ||||||
Noven Pharmaceuticals, Inc.* | 5,500 | 128,975 | ||||||
Obagi Medical Products, Inc.* | 2,300 | 40,756 | ||||||
Omrix Biopharmaceuticals, Inc.* | 2,200 | 69,212 | ||||||
Onyx Pharmaceuticals, Inc.* | 9,700 | 260,930 | ||||||
OSI Pharmaceuticals, Inc.* | 12,500 | 452,625 | ||||||
Pain Therapeutics, Inc.* | 8,100 | 70,551 | ||||||
Par Pharmaceutical Cos., Inc.* | 7,300 | 206,079 | ||||||
Penwest Pharmaceuticals Co.* | 6,400 | 79,808 | ||||||
Perrigo Co. | 17,200 | 336,776 | ||||||
Poniard Pharmaceuticals, Inc.* | 7,800 | 53,040 | ||||||
Pozen, Inc.* | 5,400 | 97,578 | ||||||
Progenics Pharmaceuticals, Inc.* | 5,600 | 120,792 | ||||||
Regeneron Pharmaceuticals, Inc.* | 11,700 | 209,664 | ||||||
Rigel Pharmaceuticals, Inc.* | 3,800 | 33,858 | ||||||
Salix Pharmaceuticals, Inc.* | 11,200 | 137,760 |
NVIT Small Cap Index (Continued)
Common Stock (continued) | ||||||||
Shares or | ||||||||
Principal Amount | Value | |||||||
Pharmaceuticals (continued) | ||||||||
Santarus, Inc.* | 9,800 | $ | 50,666 | |||||
Savient Pharmaceuticals, Inc.* | 10,700 | 132,894 | ||||||
Sciele Pharma, Inc.* | 7,500 | 176,700 | ||||||
Somaxon Pharmaceuticals, Inc.* | 3,700 | 44,992 | ||||||
SuperGen, Inc.* | 12,500 | 69,500 | ||||||
Trubion Pharmaceuticals, Inc.* | 700 | 14,616 | ||||||
Valeant Pharmaceuticals International | 18,800 | 313,772 | ||||||
Vanda Pharmaceuticals, Inc.* | 6,400 | 129,664 | ||||||
Viropharma, Inc.* | 13,800 | 190,440 | ||||||
Xenport, Inc.* | 4,000 | 177,680 | ||||||
7,988,642 | ||||||||
Real Estate Investment Trusts (REITs) (5.8%) | ||||||||
Acadia Realty Trust | 7,000 | 181,650 | ||||||
Agree Realty Corp. | 1,600 | 50,000 | ||||||
Alesco Financial, Inc. | 7,900 | 64,227 | ||||||
Alexander’s, Inc.* | 400 | 161,700 | ||||||
Alexandria Real Estate Equities, Inc. | 6,000 | 580,920 | ||||||
American Campus Communities, Inc. | 5,100 | 144,279 | ||||||
American Financial Realty Trust | 26,300 | 271,416 | ||||||
American Home Mortgage Investment Corp. | 11,000 | 202,180 | ||||||
Anthracite Capital, Inc. | 11,800 | 138,060 | ||||||
Anworth Mortgage Asset Corp. | 9,200 | 83,260 | ||||||
Arbor Realty Trust, Inc. | 3,500 | 90,335 | ||||||
Ashford Hospitality Trust | 21,350 | 251,076 | ||||||
Associated Estates Realty Corp. | 5,300 | 82,627 | ||||||
Biomed Realty Trust, Inc. | 13,200 | 331,584 | ||||||
BRT Realty Trust | 2,500 | 65,025 | ||||||
Capital Lease Funding, Inc. | 7,500 | 80,625 | ||||||
Capital Trust, Inc., Class A | 2,500 | 85,350 | ||||||
CBRE Realty Finance, Inc. | 3,700 | 43,993 | ||||||
Cedarshopping Centers, Inc. | 9,500 | 136,325 | ||||||
Corporate Office Properties Trust | 7,900 | 323,979 | ||||||
Cousins Properties, Inc. | 8,200 | 237,882 | ||||||
Crescent Real Estate Equities Co. | 16,700 | 374,748 | ||||||
Crystal River Capital, Inc. | 3,900 | 94,692 | ||||||
DCT Industrial Trust, Inc. | 34,000 | 365,840 | ||||||
Deerfield Triarc Capital Corp. | 10,400 | 152,152 | ||||||
Diamondrock Hospitality Co. | 18,200 | 347,256 | ||||||
Digital Reality Trust, Inc. | 9,900 | 373,032 | ||||||
EastGroup Properties, Inc. | 4,600 | 201,572 | ||||||
Education Realty Trust, Inc. | 8,000 | 112,240 | ||||||
Entertainment Properties Trust | 5,400 | 290,412 | ||||||
Equity Inns, Inc. | 12,800 | 286,720 | ||||||
Equity Lifestyle Properties, Inc. | 4,100 | 213,979 | ||||||
Equity One, Inc. | 6,800 | 173,740 | ||||||
Extra Space Storage, Inc. | 13,000 | 214,500 | ||||||
Felcor Lodging Trust, Inc. | 11,200 | 291,536 | ||||||
First Industrial Realty Trust | 9,700 | 375,972 | ||||||
First Potomac Realty Trust | 5,800 | 135,082 | ||||||
Franklin Street Properties Corp. | 10,200 | 168,708 | ||||||
Friedman, Billings, Ramsey Group, Inc. | 29,000 | 158,340 | ||||||
Getty Realty Corp. | 2,800 | 73,584 | ||||||
Glimcher Realty Trust | 8,200 | 205,000 | ||||||
GMH Communities Trust | 7,500 | 72,675 | ||||||
Gramercy Capital Corp. | 2,800 | 77,112 | ||||||
Healthcare Realty Trust, Inc. | 10,800 | 300,024 | ||||||
Hersha Hospitality Trust | 7,200 | 85,104 | ||||||
HFF, Inc., Class A* | 3,000 | 46,530 | ||||||
Highland Hospitality Corp. | 13,200 | 253,440 | ||||||
Highwood Properties, Inc. | 11,500 | 431,250 | ||||||
Home Properties of New York, Inc. | 7,300 | 379,089 | ||||||
Impac Mortgage Holdings | 18,800 | 86,668 | ||||||
Inland Real Estate Corp. | 11,700 | 198,666 | ||||||
InnKeepers U.S.A. Trust | 8,300 | 147,159 | ||||||
Investors Real Estate Trust | 9,700 | 100,201 | ||||||
JER Investors Trust, Inc. | 4,300 | 64,500 | ||||||
Kite Realty Group Trust | 5,200 | 98,904 | ||||||
Lasalle Hotel Properties | 8,600 | 373,412 | ||||||
Lexington Corporate Properties Trust | 13,400 | 278,720 | ||||||
LTC Properties, Inc. | 3,500 | 79,625 | ||||||
Luminent Mortgage Capital, Inc. | 12,200 | 123,098 | ||||||
Maguire Properties, Inc. | 7,600 | 260,908 | ||||||
Medical Properties Trust, Inc. | 10,000 | 132,300 | ||||||
MFA Mortgage Investments, Inc. | 16,400 | 119,392 | ||||||
Mid-America Apartment Communities, Inc. | 4,900 | 257,152 | ||||||
National Health Investors, Inc. | 3,900 | 123,708 | ||||||
National Retail Properties, Inc. | 13,500 | 295,110 | ||||||
Nationwide Health Properties, Inc. | 18,000 | 489,600 | ||||||
Newcastle Investment Corp. | 9,500 | 238,165 | ||||||
Northstar Realty Finance Corp. | 10,900 | 136,359 | ||||||
Novastar Financial, Inc. | 9,800 | 68,404 | ||||||
Omega Healthcare Investors, Inc. | 13,600 | 215,288 | ||||||
Parkway Properties, Inc. | 3,200 | 153,696 | ||||||
Pennsylvania Real Estate Investment Trust | 6,600 | 292,578 | ||||||
Post Properties, Inc. | 9,500 | 495,235 | ||||||
Potlatch Corp. | 7,400 | 318,570 | ||||||
PS Business Parks, Inc. | 3,000 | 190,110 | ||||||
Quadra Realty Trust, Inc.* | 800 | 10,008 |
Common Stock (continued) | ||||||||
Shares or | ||||||||
Principal Amount | Value | |||||||
Real Estate Investment Trusts (continued) | ||||||||
RAIT Financial Trust | 13,300 | $ | 346,066 | |||||
Ramco-Gershenson Properties Trust | 3,800 | 136,534 | ||||||
Realty Income | 20,400 | 513,876 | ||||||
Redwood Trust, Inc. | 4,300 | 208,034 | ||||||
Republic Property Trust | 7,900 | 96,775 | ||||||
Resource Capital Corp. | 2,500 | 34,950 | ||||||
Saul Centers, Inc. | 2,900 | 131,515 | ||||||
Senior Housing Properties Trust | 15,400 | 313,390 | ||||||
Sovran Self Storage, Inc. | 4,200 | 202,272 | ||||||
Spirit Finance Corp. | 20,800 | 302,848 | ||||||
Strategic Hotel Capital, Inc. | 14,500 | 326,105 | ||||||
Sun Communities, Inc. | 4,300 | 128,011 | ||||||
Sunstone Hotel Investors, Inc. | 12,600 | 357,714 | ||||||
Tanger Factory Outlet Centers, Inc. | 7,100 | 265,895 | ||||||
U-Store-It Trust | 8,500 | 139,315 | ||||||
Universal Health Realty Income Trust | 2,100 | 69,930 | ||||||
Urstadt Biddle Properties | 3,700 | 62,937 | ||||||
Washington Real Estate Investment Trust | 9,100 | 309,400 | ||||||
Winston Hotels, Inc. | 4,000 | 60,000 | ||||||
Winthrop Realty Trust | 5,300 | 36,623 | ||||||
19,250,548 | ||||||||
Real Estate Management & Development (0.2%) | ||||||||
Affordable Residential Communities* | 9,000 | 106,380 | ||||||
Consolidated Tomoka Land Co. | 1,200 | 83,148 | ||||||
Grubb & Ellis Co.* | 5,100 | 59,160 | ||||||
Meruelo Maddux Properties, Inc.* | 8,900 | 72,624 | ||||||
Mission West Properties, Inc. | 1,600 | 22,304 | ||||||
Move, Inc.* | 21,100 | 94,528 | ||||||
Tejon Ranch Co.* | 1,800 | 79,560 | ||||||
Thomas Properties Group, Inc. | 6,600 | 105,468 | ||||||
623,172 | ||||||||
Road & Rail (0.8%) | ||||||||
AMERCO* | 2,000 | 151,000 | ||||||
Arkansas Best Corp. | 5,400 | 210,438 | ||||||
Celadon Group, Inc.* | 6,700 | 106,530 | ||||||
Dollar Thrifty Automotive Group, Inc.* | 5,600 | 228,704 | ||||||
Florida East Coast Industries, Inc. | 7,500 | 622,350 | ||||||
Genesee & Wyoming, Inc.* | 6,900 | 205,896 | ||||||
Heartland Express, Inc. | 11,700 | 190,710 | ||||||
Knight Transportation, Inc. | 10,600 | 205,428 | ||||||
Marten Transport Ltd.* | 2,141 | 38,559 | ||||||
Old Dominion Freight Line, Inc.* | 6,000 | 180,900 | ||||||
Saia, Inc.* | 3,500 | 95,410 | ||||||
Universal Truckload Services, Inc.* | 900 | 17,883 | ||||||
Werner Enterprises, Inc. | 11,000 | 221,650 | ||||||
2,475,458 | ||||||||
Semiconductors & Semiconductor Equipment (3.2%) | ||||||||
Actel Corp.* | 5,300 | 73,723 | ||||||
Advanced Analogic Technologies, Inc.* | 7,700 | 74,690 | ||||||
Advanced Energy Industries, Inc.* | 7,100 | 160,886 | ||||||
Amis Holdings, Inc.* | 10,900 | 136,468 | ||||||
Amkor Technology, Inc.* | 20,700 | 326,025 | ||||||
Anadigics, Inc.* | 11,900 | 164,101 | ||||||
Applied Micro Circuits Corp.* | 59,900 | 149,750 | ||||||
Asyst Technologies, Inc.* | 9,900 | 71,577 | ||||||
Atheros Communications* | 11,200 | 345,408 | ||||||
ATMI, Inc.* | 7,000 | 210,000 | ||||||
Axcelis Technologies, Inc.* | 20,500 | 133,045 | ||||||
Brooks Automation, Inc.* | 15,300 | 277,695 | ||||||
Cabot Microelectronics Corp.* | 4,800 | 170,352 | ||||||
Cavium Networks, Inc.* | 400 | 9,048 | ||||||
Cirrus Logic, Inc.* | 17,800 | 147,740 | ||||||
Cohu, Inc. | 4,600 | 102,350 | ||||||
Conexant Systems, Inc.* | 97,500 | 134,550 | ||||||
Credence Systems Corp.* | 20,400 | 73,440 | ||||||
Cymer, Inc.* | 8,100 | 325,620 | ||||||
Diodes, Inc.* | 4,000 | 167,080 | ||||||
DSP Group, Inc.* | 7,200 | 147,384 | ||||||
Eagle Test Systems, Inc.* | 1,900 | 30,514 | ||||||
Entegris, Inc.* | 27,300 | 324,324 | ||||||
Exar Corp.* | 8,100 | 108,540 | ||||||
FormFactor, Inc.* | 9,200 | 352,360 | ||||||
Genesis Microchip, Inc.* | 8,700 | 81,432 | ||||||
Hittite Microwave Corp.* | 2,500 | 106,825 | ||||||
Intevac* | 4,400 | 93,544 | ||||||
IXYS Corp.* | 4,200 | 35,070 | ||||||
Kulicke & Soffa Industries, Inc.* | 12,400 | 129,828 | ||||||
Lattice Semiconductor Corp.* | 27,800 | 159,016 | ||||||
LTX Corp.* | 12,500 | 69,500 | ||||||
Mattson Technology, Inc.* | 10,600 | 102,820 | ||||||
Micrel, Inc. | 11,400 | 145,008 | ||||||
Microsemi* | 16,800 | 402,360 | ||||||
Microtune, Inc.* | 10,000 | 52,300 | ||||||
MIPS Technologies, Inc.* | 8,800 | 77,352 | ||||||
MKS Instruments, Inc.* | 9,100 | 252,070 | ||||||
Monolithic Power System, Inc.* | 3,400 | 59,330 | ||||||
Netlogic Microsystems, Inc.* | 4,100 | 130,544 | ||||||
OmniVision Technologies, Inc.* | 11,100 | 201,021 |
NVIT Small Cap Index (Continued)
Common Stock (continued) | ||||||||
Shares or | ||||||||
Principal Amount | Value | |||||||
Semiconductors & Semiconductor Equipment (continued) | ||||||||
On Semiconductor Corp.* | 47,000 | $ | 503,840 | |||||
PDF Solutions, Inc.* | 3,100 | 36,673 | ||||||
Pericom Semiconductor Corp.* | 5,200 | 58,032 | ||||||
Photronics, Inc.* | 8,100 | 120,528 | ||||||
PLX Technology, Inc.* | 3,800 | 42,408 | ||||||
PMC-Sierra, Inc.* | 39,900 | 308,427 | ||||||
RF Micro Devices, Inc.* | 42,000 | 262,080 | ||||||
Rudolph Technologies, Inc.* | 4,900 | 81,389 | ||||||
Semitool, Inc.* | 4,500 | 43,245 | ||||||
Semtech Corp.* | 16,400 | 284,212 | ||||||
Sigma Designs, Inc.* | 4,600 | 120,014 | ||||||
Silicon Image, Inc.* | 17,700 | 151,866 | ||||||
Silicon Storage Technology, Inc.* | 19,100 | 71,243 | ||||||
SiRF Technology Holdings, Inc.* | 10,700 | 221,918 | ||||||
Skyworks Solutions, Inc.* | 32,300 | 237,405 | ||||||
Spansion, Inc., Class A* | 16,100 | 178,710 | ||||||
Standard Microsystems Corp.* | 5,400 | 185,436 | ||||||
Supertex, Inc.* | 3,200 | 100,288 | ||||||
Techwell, Inc.* | 1,600 | 20,960 | ||||||
Tessera Technologies, Inc.* | 9,100 | 369,005 | ||||||
Trident Microsystems, Inc.* | 12,900 | 236,715 | ||||||
TriQuint Semiconductor, Inc.* | 29,000 | 146,740 | ||||||
Ultra Clean Holdings, Inc.* | 2,300 | 32,154 | ||||||
Ultratech Stepper, Inc.* | 5,700 | 75,981 | ||||||
Veeco Instruments, Inc.* | 6,300 | 130,662 | ||||||
Volterra Semiconductor Corp.* | 3,900 | 55,380 | ||||||
Zoran Corp.* | 10,000 | 200,400 | ||||||
10,590,401 | ||||||||
Service Companies (0.1%) | ||||||||
24/7 Real Media, Inc.* | 9,800 | 114,954 | ||||||
Heidrick & Struggles International, Inc.* | 4,300 | 220,332 | ||||||
335,286 | ||||||||
Software (3.0%) | ||||||||
Actuate Corp.* | 8,900 | 60,431 | ||||||
Advent Software, Inc.* | 3,700 | 120,435 | ||||||
Agile Software* | 14,500 | 116,870 | ||||||
Ansoft Corp.* | 2,900 | 85,521 | ||||||
Ansys, Inc.* | 15,700 | 416,050 | ||||||
Aspen Technology, Inc.* | 17,800 | 249,200 | ||||||
Blackbaud, Inc. | 8,900 | 196,512 | ||||||
Blackboard, Inc.* | 6,500 | 273,780 | ||||||
Borland Software Corp.* | 19,100 | 113,454 | ||||||
Bottomline Technologies, Inc.* | 4,400 | 54,340 | ||||||
Chordiant Software, Inc.* | 8,100 | 126,846 | ||||||
Commvault Systems, Inc.* | 8,600 | 148,522 | ||||||
Comverge, Inc.* | 400 | 12,404 | ||||||
Concur Technologies, Inc.* | 8,700 | 198,795 | ||||||
Double-Take Software, Inc.* | 1,500 | 24,615 | ||||||
Epicor Software Corp.* | 12,700 | 188,849 | ||||||
EPIQ Systems, Inc.* | 6,900 | 111,504 | ||||||
eSPEED, Inc.* | 6,500 | 56,160 | ||||||
Falconstor Software, Inc.* | 8,700 | 91,785 | ||||||
Henry (Jack) & Associates, Inc. | 15,400 | 396,550 | ||||||
I2 Technologies, Inc.* | 3,100 | 57,784 | ||||||
Informatica Corp.* | 19,300 | 285,061 | ||||||
Innerworkings, Inc.* | 3,700 | 59,274 | ||||||
InterVoice-Brite, Inc.* | 10,500 | 87,465 | ||||||
JDA Software Group, Inc.* | 5,200 | 102,076 | ||||||
Lawson Software, Inc.* | 26,300 | 260,107 | ||||||
Macrovision Corp.* | 11,200 | 336,672 | ||||||
Magma Design Automation, Inc.* | 9,300 | 130,572 | ||||||
Mentor Graphics Corp.* | 15,600 | 205,452 | ||||||
MICROS Systems, Inc.* | 8,200 | 446,080 | ||||||
MicroStrategy, Inc.* | 2,200 | 207,878 | ||||||
Midway Games, Inc.* | 5,400 | 34,344 | ||||||
MSC Software Corp.* | 6,700 | 90,718 | ||||||
Net 1 UEPS Technologies, Inc.* | 9,300 | 224,595 | ||||||
Nuance Communications, Inc.* | 26,600 | 445,018 | ||||||
Opentv Corp.* | 9,100 | 19,292 | ||||||
Parametric Technology Corp.* | 24,500 | 529,445 | ||||||
Pegasystems, Inc. | 700 | 7,651 | ||||||
Progress Software Corp.* | 9,000 | 286,110 | ||||||
QAD, Inc. | 900 | 7,470 | ||||||
Quality Systems, Inc. | 3,400 | 129,098 | ||||||
Quest Software, Inc.* | 13,800 | 223,422 | ||||||
Radiant Systems, Inc.* | 5,300 | 70,172 | ||||||
Renaissance Learning, Inc. | 600 | 7,890 | ||||||
Secure Computing Corp.* | 11,500 | 87,285 | ||||||
Solera Holdings, Inc.* | 3,800 | 73,644 | ||||||
Sonic Solutions* | 4,500 | 56,745 | ||||||
Sourceforge, Inc.* | 10,800 | 45,576 | ||||||
SPSS, Inc.* | 3,700 | 163,318 | ||||||
Sybase, Inc.* | 18,400 | 439,576 | ||||||
Take-Two Interactive Software, Inc.* | 14,900 | 297,553 | ||||||
THQ, Inc.* | 13,500 | 412,020 | ||||||
Tibco Software, Inc.* | 45,400 | 410,870 | ||||||
Transaction Systems Architects, Inc.* | 8,400 | 282,744 | ||||||
Ultimate Software Group, Inc. (The)* | 5,700 | 164,901 | ||||||
Unica Corp.* | 700 | 11,550 |
Common Stock (continued) | ||||||||
Shares or | ||||||||
Principal Amount | Value | |||||||
Software (continued) | ||||||||
Vasco Data Security International, Inc.* | 6,200 | $ | 141,112 | |||||
Wind River Systems, Inc.* | 15,100 | 166,100 | ||||||
10,049,263 | ||||||||
Specialty Retail (3.0%) | ||||||||
A.C. Moore Arts & Crafts, Inc.* | 4,100 | 80,401 | ||||||
Aaron Rents, Inc. | 8,500 | 248,200 | ||||||
Aeropostale, Inc.* | 10,400 | 433,472 | ||||||
Asbury Automotive Group, Inc. | 4,200 | 104,790 | ||||||
Bebe Stores, Inc. | 4,900 | 78,449 | ||||||
Big 5 Sporting Goods Corp. | 4,600 | 117,300 | ||||||
Blockbuster, Inc.* | 40,400 | 174,124 | ||||||
Books-A-Million, Inc. | 4,300 | 72,842 | ||||||
Borders Group, Inc. | 13,500 | 257,310 | ||||||
Buckle (The) | 2,200 | 86,680 | ||||||
Build-A-Bear-Workshop, Inc.* | 2,900 | 75,806 | ||||||
Cabela’s, Inc.* | 6,300 | 139,419 | ||||||
Cache, Inc.* | 3,900 | 51,753 | ||||||
Casual Male Retail Group, Inc.* | 9,500 | 95,950 | ||||||
Cato Corp. | 6,000 | 131,640 | ||||||
Charlotte Russe Holding, Inc.* | 5,100 | 137,037 | ||||||
Charming Shoppes* | 27,700 | 299,991 | ||||||
Children’s Place Retail Store, Inc. (The)* | 4,500 | 232,380 | ||||||
Christopher & Banking Corp. | 7,400 | 126,910 | ||||||
Citi Trends, Inc.* | 3,400 | 129,064 | ||||||
CSK Auto Corp.* | 8,300 | 152,720 | ||||||
Dress Barn, Inc.* | 10,900 | 223,668 | ||||||
DSW Inc., Class A* | 3,400 | 118,388 | ||||||
Eddie Bauer Holdings, Inc.* | 4,600 | 59,110 | ||||||
Finish Line, Inc., Class A (The) | 8,600 | 78,346 | ||||||
G-III Apparel Group* | 3,900 | 61,581 | ||||||
Genesco, Inc.* | 5,000 | 261,550 | ||||||
Group 1 Automotive, Inc. | 4,900 | 197,666 | ||||||
Guitar Center, Inc.* | 6,600 | 394,746 | ||||||
Gymboree* | 6,600 | 260,106 | ||||||
Haverty Furniture Co., Inc. | 4,200 | 49,014 | ||||||
Hibbett Sports, Inc.* | 6,700 | 183,446 | ||||||
Hot Topic, Inc.* | 10,600 | 115,222 | ||||||
J Crew Group, Inc.* | 7,400 | 400,266 | ||||||
Jos. A. Bank Clothiers, Inc.* | 4,200 | 174,174 | ||||||
Lithia Motors, Inc., Class A | 3,200 | 81,088 | ||||||
MarineMax, Inc.* | 3,300 | 66,066 | ||||||
Men’s Wearhouse, Inc. | 10,400 | 531,128 | ||||||
Monro Muffler, Inc. | 2,500 | 93,625 | ||||||
New York & Co., Inc.* | 2,900 | 31,784 | ||||||
Pacific Sunwear of California, Inc.* | 15,400 | 338,800 | ||||||
Payless ShoeSource, Inc.* | 12,600 | 397,530 | ||||||
Pep Boys — Manny, Moe & Jack (The) | 9,700 | 195,552 | ||||||
Pier 1 Imports, Inc.* | 17,800 | 151,122 | ||||||
Rent-A-Center, Inc.* | 15,400 | 403,942 | ||||||
Sally Beauty Holdings, Inc.* | 16,200 | 145,800 | ||||||
Select Comfort Corp.* | 11,700 | 189,774 | ||||||
Shoe Carnival, Inc.* | 2,800 | 76,972 | ||||||
Sonic Automotive, Inc. | 5,200 | 150,644 | ||||||
Stage Stores, Inc. | 7,400 | 155,104 | ||||||
Stein Mart, Inc. | 6,400 | 78,464 | ||||||
Syms Corp. | 100 | 1,973 | ||||||
Talbots, Inc. | 4,200 | 105,126 | ||||||
Tween Brands, Inc.* | 6,100 | 272,060 | ||||||
West Marine, Inc.* | 3,900 | 53,664 | ||||||
Wet Seal, Inc. (The), Class A* | 15,600 | 93,756 | ||||||
Zale Corp.* | 10,000 | 238,100 | ||||||
Zumiez, Inc.* | 3,200 | 120,896 | ||||||
9,776,491 | ||||||||
Technology (0.0%) | ||||||||
Arrowhead Research Corp.* | 10,300 | 51,809 | ||||||
Telephones (0.1%) | ||||||||
Consolidated Communications Holdings, Inc. | 3,400 | 76,840 | ||||||
Rural Cellular Corp.* | 1,900 | 83,239 | ||||||
160,079 | ||||||||
Textiles, Apparel & Luxury Goods (1.4%) | ||||||||
Brown Shoe Co., Inc. | 8,900 | 216,448 | ||||||
Carter’s, Inc.* | 10,600 | 274,964 | ||||||
Cherokee, Inc. | 2,300 | 84,042 | ||||||
Cole (Kenneth) Productions, Inc. | 2,300 | 56,810 | ||||||
Columbia Sportswear Co. | 2,800 | 192,304 | ||||||
Deckers Outdoor Corp.* | 2,600 | 262,340 | ||||||
Fossil, Inc.* | 9,400 | 277,206 | ||||||
Heelys, Inc.* | 1,300 | 33,618 | ||||||
Iconix Brand Group, Inc.* | 10,200 | 226,644 | ||||||
K-Swiss, Inc., Class A | 5,200 | 147,316 | ||||||
Kellwood Co. | 5,200 | 146,224 | ||||||
Maidenform Brands, Inc.* | 3,700 | 73,482 | ||||||
Movado Group, Inc. | 3,400 | 114,716 | ||||||
Oxford Industries, Inc. | 3,100 | 137,454 | ||||||
Perry Ellis International, Inc.* | 3,100 | 99,727 | ||||||
Quiksilver, Inc.* | 25,100 | 354,663 | ||||||
Skechers U.S.A., Inc.* | 3,900 | 113,880 | ||||||
Steven Madden Ltd. | 5,100 | 167,076 |
NVIT Small Cap Index (Continued)
Common Stock (continued) | ||||||||
Shares or | ||||||||
Principal Amount | Value | |||||||
Textiles, Apparel & Luxury Goods (continued) | ||||||||
Stride Rite Corp. | 7,400 | $ | 149,924 | |||||
Timberland Co., Class A* | 9,500 | 239,305 | ||||||
True Religion Apparel, Inc.* | 3,900 | 79,287 | ||||||
Under Armour, Inc.* | 5,000 | 228,250 | ||||||
UniFirst Corp. | 2,400 | 105,720 | ||||||
Volcom, Inc.* | 2,800 | 140,364 | ||||||
Warnaco Group, Inc. (The)* | 9,300 | 365,862 | ||||||
Weyco Group, Inc. | 200 | 5,386 | ||||||
Wolverine World Wide, Inc. | 11,000 | 304,810 | ||||||
Xerium Technologies, Inc. | 1,300 | 9,906 | ||||||
4,607,728 | ||||||||
Thrifts & Mortgage Finance (1.5%) | ||||||||
Accredited Home Lenders Holding Co.* | 5,800 | 79,286 | ||||||
Anchor BanCorp Wisconsin, Inc. | 4,000 | 104,760 | ||||||
Bank Mutual Corp. | 12,400 | 142,972 | ||||||
BankAtlantic Bancorp, Inc., Class A | 10,100 | 86,961 | ||||||
BankUnited Financial Corp., Class A | 7,900 | 158,553 | ||||||
Berkshire Hills Bancorp, Inc. | 1,800 | 56,718 | ||||||
Brookline Bancorp, Inc. | 14,900 | 171,499 | ||||||
Centerline Holding Co. | 10,300 | 185,400 | ||||||
City Bank | 2,200 | 69,322 | ||||||
Clayton Holdings, Inc.* | 1,500 | 17,085 | ||||||
Clifton Savings Bancorp, Inc. | 400 | 4,336 | ||||||
Corus Bankshares, Inc. | 7,900 | 136,354 | ||||||
Delta Financial Corp. | 5,100 | 62,577 | ||||||
Dime Community Bancshares | 5,500 | 72,545 | ||||||
Downey Financial Corp. | 4,700 | 310,106 | ||||||
Federal Agricultural Mortgage Corp., Class C | 2,200 | 75,284 | ||||||
First Busey Corp. | 2,100 | 41,979 | ||||||
First Financial Holdings, Inc. | 2,400 | 78,504 | ||||||
First Niagara Financial Group, Inc. | 24,200 | 317,020 | ||||||
First Place Financial Corp. | 2,100 | 44,352 | ||||||
FirstFed Financial Corp.* | 3,900 | 221,247 | ||||||
Flagstar Bancorp | 8,500 | 102,425 | ||||||
Franklin Bank Corp.* | 6,900 | 102,810 | ||||||
Fremont General Corp. | 15,500 | 166,780 | ||||||
ITLA Capital Corp. | 1,700 | 88,604 | ||||||
Kearny Financial Corp. | 2,900 | 39,092 | ||||||
KNBT Bancorp, Inc. | 4,400 | 64,680 | ||||||
MAF Bancorp, Inc. | 7,300 | 396,098 | ||||||
NASB Financial, Inc. | 200 | 6,730 | ||||||
NewAlliance Bancshares, Inc. | 22,900 | 337,088 | ||||||
Northwest Bancorp, Inc. | 2,900 | 75,806 | ||||||
Ocwen Financial Corp.* | 6,600 | 87,978 | ||||||
Partners Trust Financial Group | 7,000 | 73,500 | ||||||
PFF Bancorp, Inc. | 4,800 | 134,064 | ||||||
Provident Financial Services, Inc. | 12,500 | 197,000 | ||||||
Provident New York Bancorp | 6,900 | 93,219 | ||||||
Rockville Financial, Inc. | 1,600 | 24,160 | ||||||
Roma Financial Corp. | 300 | 4,971 | ||||||
Tierone Corp. | 4,600 | 138,460 | ||||||
Triad Guaranty, Inc.* | 2,300 | 91,839 | ||||||
TrustCo Bank Corp. | 18,300 | 180,804 | ||||||
United Community Financial Corp. | 4,200 | 41,916 | ||||||
ViewPoint Financial Group | 700 | 12,047 | ||||||
Wauwatosa Holdings, Inc.* | 400 | 6,616 | ||||||
Westfield Financial, Inc. | 2,100 | 20,937 | ||||||
WSFS Financial Corp. | 1,800 | 117,774 | ||||||
5,042,258 | ||||||||
Tobacco (0.2%) | ||||||||
Alliance One International, Inc.* | 19,500 | 195,975 | ||||||
Universal Corp. | 5,500 | 335,060 | ||||||
Vector Group Ltd. | 7,600 | 171,228 | ||||||
702,263 | ||||||||
Trading Companies & Distributors (0.6%) | ||||||||
Applied Industrial Technologies, Inc. | 8,700 | 256,650 | ||||||
Beacon Roofing Supply, Inc.* | 9,500 | 161,405 | ||||||
BlueLinx Holdings, Inc. | 1,600 | 16,784 | ||||||
Electro Rent Corp. | 2,300 | 33,442 | ||||||
Global Sources Ltd. — BR* | 4,200 | 95,340 | ||||||
H&E Equipment Services, Inc.* | 3,600 | 99,864 | ||||||
Houston Wire & Cable Co.* | 2,900 | 82,389 | ||||||
Interline Brands, Inc.* | 5,000 | 130,400 | ||||||
Kaman Corp., Class A | 6,000 | 187,140 | ||||||
Lawson Products, Inc. | 800 | 30,960 | ||||||
NuCo2, Inc.* | 3,100 | 79,577 | ||||||
Rush Enterprises, Inc., Class A* | 4,200 | 91,224 | ||||||
TAL International Group, Inc. | 2,200 | 65,362 | ||||||
Transdigm Group, Inc.* | 1,600 | 64,736 | ||||||
UAP Holding Corp. | 10,400 | 313,456 | ||||||
Watsco, Inc. | 5,000 | 272,000 | ||||||
Williams Scotsman International, Inc.* | 6,100 | 145,241 | ||||||
2,125,970 | ||||||||
Transportation (0.2%) | ||||||||
Golar LNG Ltd. | 8,600 | 143,276 | ||||||
GulfMark Offshore Services, Inc.* | 5,200 | 266,344 | ||||||
Horizon Lines, Inc. | 5,800 | 190,008 | ||||||
Knightsbridge Tankers Ltd. — BR | 4,500 | 137,295 | ||||||
736,923 | ||||||||
Common Stocks (continued) | ||||||||
Shares or | ||||||||
Principal Amount | Value | |||||||
Transportation Infrastructure (0.0%) | ||||||||
Interpool, Inc. | 1,200 | $ | 32,280 | |||||
Water Utilities (0.2%) | ||||||||
American States Water Co. | 3,400 | 120,938 | ||||||
Cadiz, Inc.* | 1,300 | 29,211 | ||||||
California Water Service Group | 4,000 | 149,960 | ||||||
Consolidated Water Co. Ltd. | 1,700 | 49,827 | ||||||
Pico Holdings, Inc.* | 2,800 | 121,128 | ||||||
SJW Corp. | 2,500 | 83,250 | ||||||
Southwest Water Co. | 6,700 | 85,559 | ||||||
639,873 | ||||||||
Wireless Telecommunication Services (0.4%) | ||||||||
Centennial Communications* | 3,900 | 37,011 | ||||||
Dobson Communications Corp., Class A* | 31,600 | 351,076 | ||||||
Fibertower Corp.* | 26,100 | 113,013 | ||||||
Hughes Communications, Inc.* | 700 | 36,526 | ||||||
ICO Global Communications (Holdings) Ltd.* | 26,200 | 91,176 | ||||||
InPhonic, Inc.* | 5,700 | 26,562 | ||||||
iPCS, Inc. | 3,700 | 125,319 | ||||||
Nextwave Wireless, Inc.* | 3,000 | 25,050 | ||||||
Novatel Wireless, Inc.* | 7,000 | 182,140 | ||||||
Syniverse Holdings, Inc.* | 3,969 | 51,041 | ||||||
U..S.A. Mobility, Inc. | 5,100 | 136,476 | ||||||
1,175,390 | ||||||||
Total Common Stocks (Cost $289,983,958) | 292,507,835 | |||||||
Nomura Securities, 5.20% dated 06/29/07, due 07/02/07, repurchase price $39,137,241, collateralized by U.S. Government Agency Mortgages with a market value of $39,902,695 | $ | 39,120,289 | 39,120,289 | |||||
Total Investments (Cost $329,104,247) (a) — 100.1% | 331,628,124 | |||||||
Liabilities in excess of other assets — (0.1)% | (187,954 | ) | ||||||
NET ASSETS — 100.0% | $ | 331,440,170 | ||||||
* | Denotes a non-income producing security. | |
(a) | See notes to financial statements for tax unrealized appreciation (depreciation) of securities. |
BR | Brazil | |
KY | Cayman Islands | |
PA | Panama | |
PR | Puerto Rico | |
MH | Marshall Islands | |
BS | Bahamas |
At June 30, 2007, the Fund’s open futures contracts were as follows:
Market Value | Unrealized | |||||||||||||||
Number of | Long | Covered by | Appreciation | |||||||||||||
Contracts | Contracts | Expiration | Contracts | (Depreciation) | ||||||||||||
89 | Russell 2000 | 09/21/07 | $ | 37,473,450 | $ | (258,852 | ) | |||||||||
$ | 37,473,450 | $ | (258,852 | ) | ||||||||||||
See accompanying notes to financial statements.
NVIT Small Cap | ||||||
Index | ||||||
Assets: | ||||||
Investments, at value (cost $289,983,958) | $ | 292,507,835 | ||||
Repurchase agreements, at cost and value | 39,120,289 | |||||
Total Investments | 331,628,124 | |||||
Interest and dividends receivable | 500,695 | |||||
Receivable for capital shares issued | 321,713 | |||||
Total Assets | 332,450,532 | |||||
Liabilities: | ||||||
Payable to custodian | 784,851 | |||||
Payable for variation margin on futures contracts | 126,945 | |||||
Accrued expenses and other payables: | ||||||
Investment advisory fees | 54,993 | |||||
Fund administration and transfer agent fees | 24,592 | |||||
Compliance program costs | 1,450 | |||||
Other | 17,531 | |||||
Total Liabilities | 1,010,362 | |||||
Net Assets | $ | 331,440,170 | ||||
Represented by: | ||||||
Capital | $ | 326,250,230 | ||||
Accumulated net investment income | 235,739 | |||||
Accumulated net realized gains from investment transactions and futures | 2,689,176 | |||||
Net unrealized appreciation on investments and futures | 2,265,025 | |||||
Net Assets | $ | 331,440,170 | ||||
Net Assets: | ||||||
Class ID Shares | $ | 331,440,170 | ||||
Shares outstanding (unlimited number of shares authorized): | ||||||
Class ID Shares | 32,651,339 | |||||
Net asset value and offering price per share (Net assets by class divided by shares outstanding by class, respectively.): | ||||||
Class ID Shares | $ | 10.15 | ||||
30
NVIT Small Cap | |||||
Index | |||||
INVESTMENT INCOME: | |||||
Interest income | $ | 492,279 | |||
Dividend income | 1,168,087 | ||||
Total Income | 1,660,366 | ||||
Expenses: | |||||
Investment advisory fees | 137,445 | ||||
Fund administration and transfer agent fees | 49,364 | ||||
Custodian fees | 4,595 | ||||
Trustee fees | 3,968 | ||||
Compliance program costs (Note 3) | 1,450 | ||||
Other | 16,259 | ||||
Total expenses before earnings credit | 213,081 | ||||
Earnings credit (Note 6) | (730 | ) | |||
Net Expenses | 212,351 | ||||
Net Investment Income | 1,448,015 | ||||
REALIZED/ UNREALIZED GAINS (LOSSES) FROM INVESTMENTS: | |||||
Net realized gains on investment transactions | 2,061,876 | ||||
Net realized gains on futures transactions | 627,300 | ||||
Net realized gains on investment transactions and futures | 2,689,176 | ||||
Net change in unrealized appreciation on investments and futures | 2,265,025 | ||||
Net realized/unrealized gains (losses) on investments and futures | 4,954,201 | ||||
CHANGE IN NET ASSETS RESULTING FROM OPERATIONS | $ | 6,402,216 | |||
(a) | For the period from April 13, 2007 (commencement of operations) through June 30, 2007 |
31
NVIT Small Cap | |||||
Index | |||||
Six Months Ended | |||||
June 30, 2007 (a) | |||||
(Unaudited) | |||||
FROM INVESTMENT ACTIVITIES: | |||||
Operations: | |||||
Net investment income | $ | 1,448,015 | |||
Net realized gains on investment transactions and futures | 2,689,176 | ||||
Net change in unrealized appreciation on investments and futures | 2,265,025 | ||||
Change in net assets resulting from operations | 6,402,216 | ||||
Distributions to Shareholders from: | |||||
Net investment income: | |||||
Class ID | (1,212,276 | ) | |||
Change in net assets from shareholder distributions | (1,212,276 | ) | |||
Change in net assets from capital transactions | 326,250,230 | ||||
Change in net assets | 331,440,170 | ||||
Net Assets: | |||||
Beginning of period | — | ||||
End of period | $ | 331,440,170 | |||
Accumulated net investment income at end of period | $ | 235,739 | |||
CAPITAL TRANSACTIONS: | |||||
Class ID Shares | |||||
Proceeds from shares issued | $ | 8,247,792 | |||
Proceeds from in-kind transactions | 320,652,408 | ||||
Dividends reinvested | 1,212,265 | ||||
Cost of shares redeemed (b) | (3,862,235 | ) | |||
Change in net assets from capital transactions | $ | 326,250,230 | |||
SHARE TRANSACTIONS: | |||||
Class ID Shares | |||||
Issued | 844,769 | ||||
Proceeds from in-kind transactions | 32,065,241 | ||||
Reinvested | 120,384 | ||||
Redeemed | (379,055 | ) | |||
Total change in shares | 32,651,339 | ||||
(a) | For the period from April 13, 2007 (commencement of operations) through June 30, 2007. | |
(b) | Includes redemption fees, if any. |
32
Investment Activities | Distributions | Ratios / Supplemental Data | ||||||||||||||||||||||||||||||||||
Net Realized | ||||||||||||||||||||||||||||||||||||
Net Asset | and | Total | Net Assets | |||||||||||||||||||||||||||||||||
Value, | Net | Unrealized | from | Net | Net Asset | at End of | ||||||||||||||||||||||||||||||
Beginning | Investment | Gains on | Investment | Investment | Total | Value, End | Total | Period | ||||||||||||||||||||||||||||
of Period | Income | Investments | Activities | Income | Distributions | of Period | Return (a) | (000s) | ||||||||||||||||||||||||||||
Class ID Shares | ||||||||||||||||||||||||||||||||||||
For the six months ended June 30, 2007 (Unaudited) (e) | $ | 10.00 | 0.05 | 0.14 | 0.19 | (0.04 | ) | (0.04 | ) | $ | 10.15 | 1.87% | $ | 331,440 |
[Additional columns below]
[Continued from above table, first column(s) repeated]
Ratios / Supplemental Data | ||||||||||||||||||||||
Ratio of Net | ||||||||||||||||||||||
Ratio of | Ratio of | Investment | ||||||||||||||||||||
Net | Expenses | Income | ||||||||||||||||||||
Ratio of | Investment | (Prior to | (Prior to | |||||||||||||||||||
Expenses | Income to | Reimbursements) | Reimbursements) | |||||||||||||||||||
to Average | Average Net | to Average | to Average | Portfolio | ||||||||||||||||||
Net Assets (b) | Assets (b) | Net Assets (b) (c) | Net Assets (b) (c) | Turnover (d) | ||||||||||||||||||
Class ID Shares | ||||||||||||||||||||||
For the six months ended June 30, 2007 (Unaudited) (e) | 0.30% | 0.30% | 0.30% | 0.30% | 13.41% |
(a) | Not annualized for periods less than one year. |
(b) | Annualized for periods less than one year. |
(c) | During the period, certain fees were waived and/or reimbursed. If such waivers/reimbursements had not occurred, the ratios would have been as indicated. |
(d) | Portfolio turnover is calculated on the basis of the Fund as a whole without distinguishing among the classes of shares. |
(e) | For the period from April 13, 2007 (commencement of operations) through June 30, 2007. |
[Additional columns below]
[Continued from above table, first column(s) repeated]
33
1. Organization
Nationwide Variable Insurance Trust (“NVIT” or the “Trust”) is an open-end management investment company, organized under the laws of Delaware by an amended and restated Agreement and Declaration of Trust, dated October 28, 2004, as amended to date. Prior to May 1, 2007, the Trust was named “Gartmore Variable Insurance Trust”. The Trust, originally created under the laws of Massachusetts as a Massachusetts business trust pursuant to a Declaration of Trust dated, as of June 30, 1981, and as subsequently amended, redomesticated as a Delaware Statutory Trust after the close of trading on April 29, 2005, and is registered under the Investment Company Act of 1940, as amended (the “1940 Act”). The redomestication was a change in statutory status and did not affect the operations of the Trust. As of June 30, 2007, the Trust had authorized an unlimited number of shares of beneficial interest, without par value (“shares”). The Trust currently offers shares to life insurance company separate accounts to fund the benefits under variable life insurance or annuity policies. To date, only the separate accounts of Nationwide Life Insurance Company and Nationwide Life and Annuity Insurance Company (collectively, “Nationwide”) have purchased shares of the NVIT Small Cap Index Fund (the “Fund”), (formerly, “GVIT Small Cap Index Fund”). The Trust currently operates forty (40) separate series, or mutual funds, each with its own investment objectives and strategies. This report contains the financial statements and financial highlights of the Fund.
2. Summary of Significant Accounting Policies
The following is a summary of significant accounting policies followed by the Fund in the preparation of its financial statements. The policies are in conformity with accounting principles generally accepted in the United States of America (“GAAP”). The preparation of financial statements requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of income and expenses for the period. Actual results could differ from those estimates.
(a) | Security Valuation |
Securities for which market quotations are readily available are valued at current market value as of “Valuation Time.” Valuation Time is as of the close of regular trading on the New York Stock Exchange (usually 4 p.m. Eastern time). Equity securities are valued at the last quoted sale price or, if there is no sale price, the last quoted bid price provided by an independent pricing service approved by the Trust’s Board of Trustees (“Board of Trustees”). Securities traded on NASDAQ are valued at the NASDAQ official closing price. Prices are taken from the primary market or exchange in which each security trades. Investment companies are valued at net asset value as reported by such company. | |
Most securities listed on a foreign exchange are valued either at fair value (see description below) or at the last sale price at the close of the exchange on which the security is principally traded. Foreign securities, currencies, and other assets and liabilities denominated in foreign currencies are translated into U.S. dollars at the exchange rate of said currencies against the U.S. dollar, as of Valuation Time, as provided by an independent pricing service approved by the Board of Trustees. | |
Securities for which market quotations are not readily available, or for which an independent pricing service does not provide a value or provides a value that does not represent fair value in the judgment of the Fund’s investment adviser or designee, are valued at fair value under procedures approved by the Board of Trustees. The “Fair Value” of these securities is determined in good faith by taking into account relevant factors and surrounding circumstances. Methods utilized to obtain a “Fair Value” may include the following non-exclusive list of acceptable methods: (i) a multiple of earnings; (ii) the discount from market value of a similar, freely traded security; (iii) the yield-to-maturity for debt issues; or (iv) a consolidation of the methods. The Trust’s Valuation & Operations Committee considers a non-exclusive list of factors to arrive at the appropriate method of determining “Fair Value.” For example, fair value determinations are required for securities whose value is affected by a “significant” event that materially affects the value of a domestic or foreign security which occurs subsequent to the time of the close of the principal market on which such domestic or foreign security trades and before the Valuation Time (i.e., a “subsequent event”). Typically, |
this will involve events occurring after the close of a foreign market on which a security trades and before the next Valuation Time. | |
The Fund values foreign securities at fair value in the circumstances described below. Generally, trading in foreign securities markets is completed each day at various times prior to the Valuation Time. Due to the time differences between the closings of the relevant foreign securities exchanges and the Valuation Time for the Fund, the Fund will fair value its foreign investments when it is determined that the market quotations for the foreign investments either are not readily available or are unreliable and, therefore, do not represent fair value. When the fair value prices are utilized, these prices will attempt to reflect the impact of the U.S. financial markets’ perceptions and trading activities on the Fund’s foreign investments since the last closing prices of the foreign investments were calculated on their primary foreign securities markets or exchanges. For these purposes, the Board of Trustees has determined that movements in relevant indices or other appropriate market indicators, after the close of the foreign securities exchanges, may demonstrate that market quotations are unreliable, and may trigger fair value pricing for certain securities. Consequently, fair valuation of portfolio securities may occur on a daily basis. |
(b) | Repurchase Agreements |
The Fund may enter into repurchase agreements with an entity which is a member of the Federal Reserve System or which is a “primary dealer” (as designated by the Federal Reserve Bank of New York) in U.S. Government obligations. The repurchase price generally equals the price paid by the Fund plus interest negotiated on the basis of current short-term rates, which may be more or less than the rate on the underlying portfolio securities. The seller under a repurchase agreement is required to maintain the value of the collateral held pursuant to the agreement at a market value equal to or greater than the repurchase price (including accrued interest). Collateral subject to repurchase agreements is held by the Fund’s custodian or another qualified sub-custodian or in the Federal Reserve/ Treasury book-entry system. If the counterparty defaults and the fair value of the collateral declines, realization of the collateral by the Fund may be delayed or limited. The Fund may transfer uninvested cash balances into a pooled cash account. These balances are invested in one or more repurchase agreements, with the counterparty of Nomura Securities, which is fully collateralized by U.S. Government Agency Mortgages. |
(c) | Futures Contracts |
The Fund may invest in financial futures contracts (“futures contracts”) for the purpose of hedging its existing portfolio securities or securities that the Fund intends to purchase against fluctuations in value caused by changes in prevailing market interest rates or prices. Futures contracts may also be entered into for non-hedging purposes. | |
Upon entering into a futures contract, the Fund is required to pledge to the broker an amount of cash and/or other assets equal to a certain percentage of the contract amount (initial margin deposit). Subsequent payments, known as “variation margin,” are made each day, depending on the daily fluctuations in the fair value/market value of the underlying assets. A gain or loss equal to the daily variation margin is recognized on a daily basis. Futures contracts are valued daily at their last quoted sale price. | |
A “sale” of a futures contract means the creation of a contractual obligation to deliver the securities or foreign currency called for by the contract at a fixed price at a specified time in the future. A “purchase” of a futures contract means the creation of a contractual obligation to acquire the securities or foreign currency at a fixed price at a specified time in the future. | |
Should market conditions change unexpectedly, the Fund may not achieve the anticipated benefits of the futures contracts and may realize a loss. The use of futures transactions for hedging purposes involves the risk of imperfect correlation in movements in the price of futures contracts, interest rates, and the value of the underlying hedged assets. |
(d) | Written Options Contracts |
The Fund may write options contracts. A written option obligates the Fund to deliver (written call) or to receive (written put) a specified quantity of an underlying asset at the contract amount upon exercise by the holder of the option. When the Fund writes an option, an amount equal to the premium received by the Fund is recorded as a liability and is subsequently adjusted to the current fair value of the option written. Premiums received from writing options that expire unexercised are treated by the Fund on the expiration date as realized gains from investments. The difference between the premium and the amount paid on effecting a closing purchase transaction, as a realized loss. If a call option is exercised, the premium is added to the proceeds from the sale of the underlying security or currency in determining whether the Fund has realized a gain or loss. If a put option is exercised, the premium reduces the cost basis of the securities purchased by the Fund. Options traded on an exchange are valued at the last quoted sale price, or in the absence of a sale, the bid price provided by an independent pricing service approved by the Board of Trustees. Non-exchange traded options are valued using dealer supplied quotes. The Fund as a writer of an option bears the market risk of an unfavorable change in the price of the security underlying the written option. |
(e) | Security Transactions and Investment Income |
Security transactions are accounted for on the date the security is purchased or sold (“trade date”). Securities gains and losses are calculated on the identified cost basis. Interest income is recognized on the accrual basis and includes, where applicable, the amortization or accretion of premium or discount. Dividend income is recorded on the ex-dividend date. |
(f) | Securities Lending |
To generate additional income, the Fund may lend its portfolio securities, up to 33 1/3% of the Fund, to brokers, dealers and other financial institutions provided that (1) the borrower delivers cash or securities as collateral with respect to each new loan of U.S. securities, equal to at least 102% of the value of the portfolio securities loaned, and with respect to each new loan on non-U.S. securities, collateral of at least 105% of the value of the portfolio securities loaned; and (2) at all times thereafter shall require the borrower to mark-to-market the collateral on a daily basis so that the market value of such collateral does not fall below 100% of the value of securities loaned. The Fund receives payments from borrowers equivalent to the dividends and interest that would have been earned on securities loaned while simultaneously seeking to earn income on the investment of cash collateral. There may be risks of delay in recovery of the securities should the borrower of the securities fail financially. Loans will be made, however, only to borrowers deemed by the Fund’s investment adviser to be of good standing and creditworthy under guidelines established by the Board of Trustees and when, in judgment of the adviser, the consideration which can be earned currently from these securities loans justifies the attendant risks. Loans are subject to termination by the Fund or the borrower at any time, and, therefore, are not considered to be illiquid investments. JPMorgan Chase Bank serves as custodian for the securities lending program of the Fund. JPMorgan Chase Bank receives a fee based on the value of the collateral received from borrowers. As of June 30, 2007, the Fund did not have securities on loan. |
(g) | Distributions to Shareholders |
The Fund’s dividends from net investment income, if any, are declared and paid quarterly. The Fund’s distributions from net realized capital gains, if any, are declared and distributed at least annually. | |
Dividends and distributions to shareholders are determined in accordance with federal income tax regulations, which may differ from GAAP. These “book/tax” differences are considered either permanent or temporary in nature. In accordance with the American Institute of Certified Public Accountants Statement of Position 93-2, permanent differences (i.e., reclassification of market discounts, foreign exchange gain/loss, paydowns, and distributions from real estate investment trusts) are reclassified within the capital accounts based on their nature for federal income tax purposes; temporary differences do not require reclassification. These reclassifications have no effect upon the net asset value of the Fund. To the extent distributions exceed current and accumulated earnings and profits for federal income tax purposes, these distributions are reported as distributions of paid-in-capital. |
(h) | Federal Income Taxes |
It is the policy of the Fund to qualify or to continue to qualify as a “regulated investment company” by complying with the provisions available to certain investment companies, as defined in Subchapter M of the U.S. Internal Revenue Code, and to make distributions of net investment income and net realized capital gains sufficient to relieve the Fund from all, or substantially all, federal income taxes. | |
As of June 30, 2007, the tax cost of securities and the breakdown of unrealized appreciation (depreciation) for the Fund was as follows: |
Net Unrealized | ||||||||||||||||
Tax Cost of | Unrealized | Unrealized | Appreciation | |||||||||||||
Securities | Appreciation | Depreciation | (Depreciation) | |||||||||||||
$ | 329,267,992 | $ | 15,035,835 | $ | (12,675,703 | ) | $ | 2,360,132 | ||||||||
(i) | Allocation of Expenses, Income, and Gains and Losses |
Expenses directly attributable to the Fund are charged to the Fund. Expenses not directly attributable to the Fund are allocated proportionately among various or all funds within the Trust. The method used by the Fund for allocating income, fund level expenses, and realized and unrealized gains or losses is based on the fair value of shares outstanding relative to net assets. Under this method, each class of shares participates based on the total net asset value of that class’s shares in proportion to the total net assets of the Fund. Expenses specific to a class (such as Rule 12b-1 and administrative services fees) are charged to that class. |
3. Transactions with Affiliates
Under the terms of the Trust’s Investment Advisory Agreement, Nationwide Fund Advisors (formerly, Gartmore Mutual Fund Capital Trust (“GMF”)) (“NFA” or the “Advisor”) manages the investment of the assets and supervises the daily business affairs of the Fund. NFA is a wholly-owned subsidiary of Nationwide Financial Services (“NFS”). In addition, NFA provides investment management evaluation services in initially selecting and monitoring, on an ongoing basis, the performance of the subadviser. BlackRock Investment Management, LLC (the “subadviser”), manages all of the Fund’s investments and has the responsibility for making all investment decisions for the Fund.
Under the terms of the Investment Advisory Agreement, the Fund pays the Fund’s adviser an investment advisory fee based on the Fund’s average daily net assets. Additional information regarding investment advisory fees and subadvisory fees for NFA and the subadviser is as follows for the period ended June 30, 2007:
Total | ||||||
Fee Schedule | Fees | |||||
$0 up to $1.5 billion | 0.20% | |||||
$1.5 billion up to $3 billion | 0.19% | |||||
$3 billion or more | 0.18% | |||||
From such fees, pursuant to the subadvisory agreement, NFA paid the subadviser $48,106 for the period ended June 30, 2007.
NFA and the Fund have entered into a written contract (“Expense Limitation Agreement”) that limits operating expenses (excluding any taxes, interest, brokerage fees, Rule 12b-1 fees, short-sale dividend expenses, administrative services fees, other expenses which are capitalized in accordance with generally accepted accounting principles and may exclude other non-routine expenses not incurred in the ordinary course of the Fund’s business) from exceeding 0.30% until at least May 1, 2008.
NFA may request and receive reimbursement from the Fund of the advisory fees waived and other expenses reimbursed by NFA, respectively, pursuant to the Expense Limitation Agreement at a later date not to exceed three years from the
Under the terms of a Fund Administration and Transfer Agency Agreement, Nationwide Fund Management, LLC (formerly, Gartmore Investor Services, Inc. (“GISI”)) (“NFM”), a wholly-owned subsidiary of NFS Distributors, Inc. (“NFSDI”), provides the Fund with various administrative and accounting services for the Fund (prior to May 1, 2007, this service was provided by Gartmore SA Capital Trust (“GSA”)), and serves as Transfer and Dividend Disbursing Agent for the Fund (prior to May 1, 2007, this service was provided by GISI, an indirect subsidiary of GSA). The fees for the services provided under this Agreement are calculated based on the Trust’s average daily net assets according to the fee schedule below. The fees are then allocated proportionately among all funds within the Trust in relation to the average daily net assets of each fund and are paid to NFA. NFA pays NFM from these fees for NFM’s services.
Combined Fee Schedule* | ||||||
Up to $1 billion | 0.15% | |||||
$1 billion up to $3 billion | 0.10% | |||||
$3 billion up to $8 billion | 0.05% | |||||
$8 billion up to $10 billion | 0.04% | |||||
$10 billion up to $12 billion | 0.02% | |||||
$12 billion or more | 0.01% | |||||
* | The assets of the Nationwide NVIT Investor Destinations Aggressive Fund, the Nationwide NVIT Investor Destinations Moderately Aggressive Fund, the Nationwide NVIT Investor Destinations Moderate Fund, the Nationwide NVIT Investor Destinations Moderately Conservative Fund, and the Nationwide NVIT Investor Destinations Conservative Fund (collectively, the “Investor Destinations Funds”) are excluded from the Trust asset level amount in order to calculate this asset-based fee. The Investor Destinations Funds do not pay any part of this fee. |
NFA and NFM have entered into agreements with Citi Fund Services Ohio, Inc. (“Citi”), pursuant to which Citi provides sub-administration and sub-transfer agency services, respectively, to the Fund. Effective August 1, 2007, The BISYS Group Inc. was acquired by and became a wholly owned subsidiary of Citi.
Under the terms of a Distribution Plan under Rule 12b-1 of the 1940 Act, Nationwide Fund Distributors, LLC. (formerly, “Gartmore Distribution Services, Inc. (“GDSI”)) (“NFD” or “Distributor”), the Fund’s principal underwriter, is compensated by the Fund for expenses associated with the distribution of the Class II and Class VII shares of the Fund. NFD is a wholly-owned subsidiary of NFSDI. These fees are based on average daily net assets of Class II and Class VII shares of the Fund at an annual rate not to exceed 0.25% for Class II shares and 0.40% for Class VII shares.
Under the terms of an Administrative Services Plan, the Fund may pay fees to servicing organizations, such as broker-dealers, including NFS, and financial institutions, which agree to provide administrative support services to the shareholders of certain classes. These services include, but are not limited, to the following: establishing and maintaining shareholder accounts; processing purchase and redemption transactions; arranging bank wires; performing shareholder sub-accounting; answering inquires regarding the Fund; and other such services. These fees are based on an annual rate of up to 0.25% of the average daily net assets of Class II and Class VII shares of the Fund.
Under the terms of a letter agreement dated September 12, 2006, by and among NFA, the Audit Committee of the Trust and the Trust, the Trust has agreed to reimburse NFA certain costs related to the Fund’s portion of ongoing administration, monitoring and annual (audit) testing of the Trust’s Rule 38a-1 Compliance Program subject to the
4. Investment Transactions
For the period ended June 30, 2007, (excluding short-term securities) the Fund had purchases of $55,803,578 and sales of $37,944,653.
5. Bank Loans and Earnings Credit
The Trust has a credit agreement with JPMorgan Chase & Co., the Fund’s custodian bank, permitting the Trust to borrow up to $100,000,000. Borrowings under this arrangement bear interest at the Federal Funds rate plus 0.50%. The interest costs, if any, would be included in other fees in the Statement of Operations. No compensating balances were required under the terms of the line of credit. The line of credit is renewed annually, expiring on June 25, 2008, with a commitment fee of 0.07% per year on $100,000,000. There were no borrowings outstanding under this line of credit for the period ended June 30, 2007.
The Trust’s custodian bank has agreed to reduce the bank’s fees (earnings credit) when the Funds of the Trust maintain cash on deposit in non-interest-bearing custody and Demand Deposit Accounts. Earnings credits, if any, are shown as a reduction of total expenses on the Statement of Operations.
6. Indemnifications
Under the Trust’s organizational documents, certain of the Trust’s Officers and Trustees are indemnified against certain liabilities arising out of the performance of their duties to the Trust. In addition, the Trust has entered into Indemnification Agreements with the Trust’s trustees and certain officers covering similar liabilities. Trust Officers receive no compensation from the Trust for serving as the Trust’s Officers. In addition, in the normal course of business, the Trust enters into contracts with its vendors and others that provide for general indemnifications. The Trust’s maximum exposure under these arrangements is unknown, as this would involve future claims that may be made against the Trust. Based on experience, however, the Trust expects that risk of loss to be remote.
7. Recently Issued Accounting Pronouncements
On July 13, 2006, the Financial Accounting Standards Board (“FASB”) released FASB Interpretation No. 48, Accounting for Uncertainty in Income Taxes (“FIN 48”). FIN 48 provides guidance for how uncertain tax positions should be recognized, measured, presented and disclosed in the financial statements. FIN 48 requires the affirmative evaluation of tax positions taken or expected to be taken in the course of preparing the Fund’s tax returns to determine whether it is more-likely-than-not (i.e., greater than 50 percent) that each tax position will be sustained upon examination by a taxing authority based on the technical merits of the position. A tax position that meets the more-likely-than-not recognition threshold is measured to determine the amount of benefit to recognize in the financial statements. Differences between tax positions taken in a tax return and amounts recognized in the financial statements will generally result in an increase in a liability for taxes payable (or a reduction of a tax refund receivable) and an increase in a deferred tax liability (or a reduction in a deferred tax asset). Adoption of FIN 48 was required no later than the last business day of the first financial statement reporting period for fiscal years beginning after December 15, 2006 and is to be applied to all open tax years as of the effective date. Accordingly, the Fund was required to implement FIN 48 in its net asset value per share (NAV) calculation on June 29, 2007. Management has evaluated the implications of FIN 48 and has concluded that there was no impact to the Fund’s financial statements as of June 29, 2007. The adoption of FIN 48 requires ongoing monitoring and analysis, future conclusions reached by management may be different and result in adjustments to the Fund’s NAV and financial statements.
In September 2006, the FASB issued Statement on Financial Accounting Standards (“SFAS”) No. 157, “Fair Value Measurements.” This standard establishes a single authoritative definition of fair value, sets out a framework for measuring fair value and requires additional disclosures about fair value measurements. SFAS No. 157 applies to fair value
Trustees who are not Interested Persons (as defined in the 1940 Act) and Officers of the Trust as of June 30, 2007
Number of | ||||||||||
Position(s) Held | Portfolios in the | |||||||||
with the Trust | Principal Occupation(s) | Nationwide Fund | Other | |||||||
Name, Address | and Length of | During Past | Complex Overseen | Directorships | ||||||
and Year of Birth | Time Served1 | Five Years | by Trustee | Held by Trustee2 | ||||||
Charles E. Allen c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1948 | Trustee since July 2000 | Mr. Allen is Chairman, Chief Executive Officer and President of Graimark Realty Advisors, Inc. (real estate development, investment and asset management). | 89 | None | ||||||
Paula H.J. Cholmondeley c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1947 | Trustee since July 2000 | Ms. Cholmondeley was Vice President and General Manager of Sappi Fine Paper North America from April 2000 through December 2003. | 89 | Director of Dentsply International, Inc.(dental products), Ultralife Batteries, Inc., Terex Corporation (construction equipment), Minerals Technology, Inc. (specialty chemicals) and Albany International Corp. (paper industry) | ||||||
C. Brent DeVore3 c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1940 | Trustee since 1990 | Dr. DeVore is President of Otterbein College. | 89 | None | ||||||
Phyllis Kay Dryden c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1947 | Trustee since December 2004 | Ms. Dryden was a partner of Mitchell Madison, a management consulting company from January 2006 until December 2006; she is currently a consultant with the company. Ms. Dryden was formerly Managing Partner of marchFIRST, a global management consulting firm. | 89 | None | ||||||
Barbara L. Hennigar c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1935 | Trustee since July 2000 | Retired. | 89 | None |
Number of | ||||||||||
Position(s) Held | Portfolios in the | |||||||||
with the Trust | Principal Occupation(s) | Nationwide Fund | Other | |||||||
Name, Address | and Length of | During Past | Complex Overseen | Directorships | ||||||
and Year of Birth | Time Served1 | Five Years | by Trustee | Held by Trustee2 | ||||||
Barbara I. Jacobs c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1950 | Trustee since December 2004 | Ms. Jacobs served as Chairman of the Board of Directors of KICAP Network Fund, a European (United Kingdom) hedge fund, from January 2001 through January 2006. From 1998-2003, Ms. Jacobs was also a Managing Director and European Portfolio Manager of CREF Investments (Teachers Insurance and Annuity Association — College Retirement Equities Fund). | 89 | None | ||||||
Douglas F. Kridler c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1955 | Trustee since September 1997 | Mr. Kridler has served as the President and Chief Executive Officer of the Columbus Foundation (a Columbus, OH-based foundation which manages over 1,300 individual endowment funds) since February 2002. Prior to January 31, 2002, Mr. Kridler was the President of the Columbus Association for the Performing Arts and Chairman of the Greater Columbus Convention and Visitors Bureau. | 89 | None | ||||||
Michael D. McCarthy c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1947 | Trustee since December 2004 | Retired. Mr. McCarthy was Chairman of VMAC (commodity swaps) from October 2002 until January 2007; and a partner of Pineville Properties LLC (a commercial real estate development firm) from September 2000 until January 2007. | 89 | None | ||||||
David C. Wetmore c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1948 | Trustee since 1995 and Chairman since February 2005 | Retired. | 89 | None | ||||||
1 | Length of time served includes time served with the Trust’s predecessors. | |
2 | Directorships held in (1) any other investment companies registered under the 1940 Act, (2) any company with a class of securities registered pursuant to Section 12 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or (3) any company subject to the requirements of Section 15(d) of the Exchange Act. | |
3 | Mr. DeVore has served as President of Otterbein College since 1984. Mark Thresher, President and Chief Operating Officer of Nationwide Financial Services, Inc. (“NFS”) has served as a member of the Board of Trustees of Otterbein College since 2000, currently serves as one of 30 of its trustees, and is currently one of two Vice Chairmen of the Board. Each of Nationwide Fund Advisors (“NFA”), the Funds’ investment adviser, and Nationwide Fund Distributors LLC (“NFD”), principal underwriter to the Trust, is a wholly-owned subsidiary of NFS. | |
Additional information regarding the Trustees and Officers may be found in the Trust’s Statement of Additional Information, which is available without charge upon request, by calling 800-848-0920. |
Trustees who are Interested Persons (as defined in the 1940 Act) and/or Officers of the Trust as of June 30, 2007
Number of | ||||||||||
Position(s) Held | Portfolios in the | |||||||||
with the Trust | Principal Occupation(s) | Nationwide Fund | Other | |||||||
Name, Address | and Length of | During Past | Complex Overseen | Directorships | ||||||
and Year of Birth | Time Served1 | Five Years | by Trustee | Held by Trustee2 | ||||||
Arden L. Shisler c/o Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1941 | Trustee since February 2000 | Retired. Mr. Shisler is the former President and Chief Executive Officer of KeB Transport, Inc., a trucking firm (2000 through 2002). He served as a consultant to KeB from January 2003 through December 2004. Since 1992, Mr. Shisler has also been Chairman of the Board for Nationwide Mutual Insurance Company.3 | 89 | Director of Nationwide Financial Services, Inc., Chairman of Nationwide Mutual Insurance Company3 | ||||||
John H. Grady Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1961 | President & Chief Executive Officer since December 2006 | Mr. Grady is President, and Chief Executive Officer of Nationwide Funds Group which includes Nationwide Fund Advisors,3 Nationwide Fund Management LLC,3 Nationwide Fund Distributors LLC 3 and NWD Investments,2 the asset management operations of Nationwide Mutual Insurance Company, which includes Morley Capital Management, Inc.,2 Nationwide Separate Accounts LLC,2 NorthPointe Capital LLC,2 and Nationwide SA Capital Trust2. From March 2004 until March 2006, Mr. Grady was Chief Executive Officer of Constellation Investment Management Co., L.P. (registered investment adviser), and President and Chief Executive Officer of Constellation Funds Group (registered investment companies). He also was President of Constellation Investment Distribution Co., Inc. (registered broker-dealer) from March 2004 until June 2006. From February 2001 until February 2004, Mr. Grady was Chief Operating and Chief Legal Officer; Managing Director, Mutual Funds Group, Turner Investment Partners, Inc. (registered investment adviser); Executive Vice President of Turner Funds and Turner Institutional Portfolios (registered investment companies); and President, Turner Investment Distributors, Inc. (registered broker-dealer). | N/A | None | ||||||
Gerald J. Holland Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken,PA 19428 1951 | Treasurer since March 2001 | Mr. Holland is Senior Vice President — Operations for Nationwide Funds Group3. | N/A | N/A |
Number of | ||||||||||
Position(s) Held | Portfolios in the | |||||||||
with the Trust | Principal Occupation(s) | Nationwide Fund | Other | |||||||
Name, Address | and Length of | During Past | Complex Overseen | Directorships | ||||||
and Year of Birth | Time Served1 | Five Years | by Trustee | Held by Trustee2 | ||||||
Michael A. Krulikowski Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1959 | Chief Compliance Officer from June 2004 to August 20074 | Mr. Krulikowski is Vice President and Chief Compliance Officer of Nationwide Funds Group3, Morley Capital Management, Inc.3 , Nationwide SA Capital Trust (since 1999)3, and Nationwide Separate Accounts LLC (since August 2005).3 Since June 2004, Mr. Krulikowski has also served as Chief Compliance Officer of the Trust. From November 1999 through May 2007, he served as Vice President and Chief Compliance Officer of NorthPointe Capital LLC. 3 | N/A | N/A | ||||||
Eric E. Miller Nationwide Funds Group 1200 River Road, Suite 1000 Conshohocken, PA 19428 1953 | Secretary since December 2002 | Mr. Miller is Senior Vice President, General Counsel, and Assistant Secretary for Nationwide Funds Group3 and NWD Investments.2 From August 2000 to August 2002, Mr. Miller was a Partner with Stradley Ronon Stevens & Young, LLP. | N/A | N/A | ||||||
1 | Length of time served includes time served with the Trust’s predecessors. | |
2 | Directorships held in (1) any other investment companies registered under the 1940 Act, (2) any company with a class of securities registered pursuant to Section 12 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or (3) any company subject to the requirements of Section 15(d) of the Exchange Act. | |
3 | This position is held with an affiliated person or principal underwriter of the Trust. | |
4 | Effective August 3, 2007, the Board of Trustees approved Carol Baldwin Moody as Chief Compliance Officer of the Trust. Since November 2005, Ms. Moody has been Senior Vice President, Chief Compliance Officer of Nationwide Financial Services, Nationwide Life Insurance Company, Nationwide Life and Annuity Insurance Company, and Nationwide Investment Advisors, LLC. From February 2004-November 2005, she was Chief Compliance Officer of TIAA-CREF and from April 2000-February 2004, she was Managing Director and General Counsel, TCW/ Latin America Partners, LLC and Baeza & Co., LLC. | |
Federal law requires the Trust, each of its investment advisers and sub-advisers to adopt procedures for voting proxies (“Proxy Voting Guidelines”) and to provide a summary of those Proxy Voting Guidelines used to vote the securities held by the Funds. The Funds’ proxy voting policies and procedures are available without charge (i) upon request, by calling 800-848-0920, (ii) on the Funds’ website at www.nationwidefunds.com, or (iii) on the Securities and Exchange Commission’s website at www.sec.gov. |
Item 2. | Code of Ethics. |
Item 3. | Audit Committee Financial Expert. |
(a)(1) | Disclose that the registrant’s board of directors has determined that the registrant either: |
(i) | Has at least one audit committee financial expert serving on its audit committee; or | ||
(ii) | Does not have an audit committee financial expert serving on its audit committee. |
(2) | If the registrant provides the disclosure required by paragraph (a)(1)(i) of this Item, it must disclose the name of the audit committee financial expert and whether that person is “independent.” In order to be considered “independent” for purposes of this Item, a member of an audit committee may not, other than in his or her capacity as a member of the audit committee, the board of directors, or any other board committee: |
(i) | Accept directly or indirectly any consulting, advisory, or other compensatory fee from the issuer; or | ||
(ii) | Be an “interested person” of the investment company as defined in Section 2(a)(19) of the Act (15 U.S.C. § 80a-2(a)(19)). |
(3) | If the registrant provides the disclosure required by paragraph (a)(1)(ii) of this Item, the registrant must explain why the registrant does not have an audit committee financial expert. |
Item 4. | Principal Accountant Fees and Services. |
Item 5. | Audit Committee of Listed Registrants. |
Item 6. | Schedule of Investments. |
Item 7. | Disclosure of Proxy Voting Policies and Procedures for Closed-End Management Investment Companies. |
Item 8. | Portfolio Managers of Closed-End Management Investment Company. |
Item 9. | Purchases of Equity Securities by Closed-End Management Investment Company and Affiliated Purchasers. |
Item 10. | Submission of Matters to a Vote of Security Holders. |
Item 11. | Controls and Procedures. |
Item 12. | Exhibits. |
(Registrant) | NATIONWIDE VARIABLE INSURANCE TRUST | |||
By (Signature and Title) | /s/ GERALD J. HOLLAND | |||
Name: | Gerald J. Holland | |||
Title: | Treasurer | |||
Date: | September 6, 2007 |
By (Signature and Title) | /s/ JOHN H. GRADY | |||
Name: | John H. Grady | |||
Title: | President & Principal Executive Officer | |||
Date: | September 6, 2007 | |||
By (Signature and Title) | /s/ GERALD J. HOLLAND | |||
Name: | Gerald J. Holland | |||
Title: | Treasurer | |||
Date: | September 6, 2007 |