UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM N-CSR
CERTIFIED SHAREHOLDER REPORT OF REGISTERED MANAGEMENT INVESTMENT COMPANIES
Investment Company Act file number 811-03651
Touchstone Strategic Trust - June Funds
(Exact name of registrant as specified in charter)
303 Broadway, Suite 1100
Cincinnati, Ohio 45202-4203
(Address of principal executive offices) (Zip code)
Jill T. McGruder
303 Broadway, Suite 1100
Cincinnati, Ohio 45202-4203
(Name and address of agent for service)
Registrant's telephone number, including area code: 800-638-8194
Date of fiscal year end: June 30
Date of reporting period: December 31, 2012
Form N-CSR is to be used by management investment companies to file reports with the Commission not later than 10 days after the transmission to stockholders of any report that is required to be transmitted to stockholders under Rule 30e-1 under the Investment Company Act of 1940 (17 CFR 270.30e-1). The Commission may use the information provided on Form N-CSR in its regulatory, disclosure review, inspection, and policymaking roles.
A registrant is required to disclose the information specified by Form N-CSR, and the Commission will make this information public. A registrant is not required to respond to the collection of information contained in Form N-CSR unless the Form displays a currently valid Office of Management and Budget ("OMB") control number. Please direct comments concerning the accuracy of the information collection burden estimate and any suggestions for reducing the burden to Secretary, Securities and Exchange Commission, 100 F Street, NE, Washington, DC 20549. The OMB has reviewed this collection of information under the clearance requirements of 44 U.S.C. § 3507.
Item 1. Reports to Stockholders.
The Report to Shareholders is attached herewith.
December 31, 2012
(Unaudited)
Semi-Annual Report
Touchstone Strategic Trust
Touchstone Capital Growth Fund
Touchstone International Small Cap Fund
Touchstone Mid Cap Value Opportunities Fund
Touchstone Small Cap Value Opportunities Fund
Touchstone U.S. Long/Short Fund
Touchstone Value Fund
Table of Contents
Page | |
Tabular Presentation of Portfolios of Investments | 3 - 4 |
Portfolio of Investments: | |
Touchstone Capital Growth Fund | 5 |
Touchstone International Small Cap Fund | 7 |
Touchstone Mid Cap Value Opportunities Fund | 10 |
Touchstone Small Cap Value Opportunities Fund | 12 |
Touchstone U.S. Long/Short Fund | 14 |
Touchstone Value Fund | 16 |
Statements of Assets and Liabilities | 18 - 21 |
Statements of Operations | 22 - 23 |
Statements of Changes in Net Assets | 24 - 27 |
Statements of Changes in Net Assets - Capital Stock Activity | 28 - 33 |
Statement of Cash Flows | 34 |
Financial Highlights | 35 - 50 |
Notes to Financial Statements | 51 - 65 |
Other Items | 66 - 68 |
Privacy Protection Policy | 69 |
2 |
Tabular Presentation of Portfolios of Investments (Unaudited)
December 31, 2012
The tables below provide each Fund’s sector allocation. We hope it will be useful to shareholders as it summarizes key information about each Fund’s investments.
Touchstone Capital Growth Fund | ||||
Sector Allocation* | (% of Net Assets) | |||
Information Technology | 33.0 | % | ||
Consumer Discretionary | 18.8 | |||
Industrials | 14.0 | |||
Health Care | 10.8 | |||
Consumer Staples | 8.6 | |||
Energy | 8.1 | |||
Financials | 2.9 | |||
Materials | 2.1 | |||
Investment Fund | 1.9 | |||
Other Assets/Liabilities (Net) | (0.2 | ) | ||
Total | 100.0 | % |
Touchstone International Small Cap Fund | ||||
Sector Allocation* | (% of Net Assets) | |||
Industrials | 17.1 | % | ||
Financials | 16.7 | |||
Consumer Discretionary | 15.8 | |||
Information Technology | 12.2 | |||
Materials | 10.7 | |||
Consumer Staples | 8.5 | |||
Health Care | 6.3 | |||
Energy | 6.0 | |||
Utilities | 3.4 | |||
Telecommunication Services | 1.1 | |||
Exchange Traded Funds | 2.0 | |||
Investment Funds | 2.0 | |||
Other Assets/Liabilities (Net) | (1.8 | ) | ||
Total | 100.0 | % |
Touchstone Mid Cap Value Opportunities Fund | ||||
Sector Allocation* | (% of Net Assets) | |||
Financials | 18.1 | % | ||
Information Technology | 17.5 | |||
Utilities | 13.0 | |||
Health Care | 12.3 | |||
Consumer Discretionary | 12.2 | |||
Industrials | 7.9 | |||
Materials | 6.2 | |||
Energy | 5.0 | |||
Consumer Staples | 2.0 | |||
Telecommunication Services | 1.7 | |||
Investment Funds | 9.2 | |||
Other Assets/Liabilities (Net) | (5.1 | ) | ||
Total | 100.0 | % |
Touchstone Small Cap Value Opportunities Fund | ||||
Sector Allocation* | (% of Net Assets) | |||
Financials | 23.2 | % | ||
Industrials | 18.3 | |||
Consumer Discretionary | 17.6 | |||
Information Technology | 12.6 | |||
Health Care | 6.4 | |||
Materials | 4.9 | |||
Energy | 4.9 | |||
Utilities | 4.1 | |||
Consumer Staples | 3.3 | |||
Telecommunication Services | 1.4 | |||
Exchange Traded Fund | 1.3 | |||
Investment Funds | 11.3 | |||
Other Assets/Liabilities (Net) | (9.3 | ) | ||
Total | 100.0 | % |
* Sector classifications are based upon the Global Industry Classification Standard (GICS®).
3 |
Tabular Presentation of Portfolios of Investments (Unaudited) (Continued)
Touchstone U.S. Long/Short Fund | ||||
Sector Allocation* | (% of Net Assets) | |||
Long Positions | ||||
Information Technology | 25.1 | % | ||
Consumer Discretionary | 20.4 | |||
Energy | 15.8 | |||
Financials | 14.5 | |||
Health Care | 13.9 | |||
Consumer Staples | 8.8 | |||
Industrials | 8.4 | |||
Materials | 7.1 | |||
Utilities | 2.4 | |||
Telecommunication Services | 1.9 | |||
Exchange Traded Fund | 1.7 | |||
Investment Fund | 0.0 | |||
Other Assets/Liabilities (Net) | 0.7 | |||
120.7 | % | |||
Short Positions | ||||
Consumer Discretionary | (5.5 | ) | ||
Energy | (4.6 | ) | ||
Information Technology | (4.2 | ) | ||
Health Care | (3.9 | ) | ||
Materials | (2.5 | ) | ||
(20.7 | ) | |||
Total | 100.0 | % |
Touchstone Value Fund | ||||
Sector Allocation* | (% of Net Assets) | |||
Financials | 22.4 | % | ||
Health Care | 14.8 | |||
Energy | 13.7 | |||
Industrials | 13.2 | |||
Consumer Staples | 11.5 | |||
Utilities | 7.3 | |||
Telecommunication Services | 5.8 | |||
Information Technology | 5.4 | |||
Consumer Discretionary | 3.7 | |||
Materials | 0.8 | |||
Investment Fund | 1.3 | |||
Other Assets/Liabilities (Net) | 0.1 | |||
Total | 100.0 | % |
* Sector classifications are based upon the Global Industry Classification Standard (GICS®).
4 |
Portfolio of Investments
Touchstone Capital Growth Fund – December 31, 2012 (Unaudited)
Market | ||||||||
Shares | Value | |||||||
Common Stocks — 98.3% | ||||||||
Information Technology — 33.0% | ||||||||
Accenture PLC (Ireland) - Class A | 35,325 | $ | 2,349,112 | |||||
Analog Devices, Inc. | 62,385 | 2,623,913 | ||||||
Apple, Inc. | 21,375 | 11,393,516 | ||||||
ARM Holdings PLC (United Kingdom), ADR | 61,175 | 2,314,250 | ||||||
Broadcom Corp. - Class A | 74,660 | 2,479,459 | ||||||
Cognizant Technology Solutions Corp.* | 34,260 | 2,536,953 | ||||||
eBay, Inc.* | 82,425 | 4,205,324 | ||||||
EMC Corp.* | 149,006 | 3,769,852 | ||||||
Equinix, Inc.* | 22,485 | 4,636,407 | ||||||
Google, Inc. - Class A* | 7,394 | 5,245,082 | ||||||
International Business Machines Corp. | 24,562 | 4,704,851 | ||||||
Qualcomm, Inc. | 81,690 | 5,066,414 | ||||||
Trimble Navigation Ltd.* | 30,375 | 1,815,818 | ||||||
VMware, Inc. - Class A* | 22,795 | 2,145,921 | ||||||
55,286,872 | ||||||||
Consumer Discretionary — 18.8% | ||||||||
Amazon.com, Inc.* | 8,785 | 2,206,265 | ||||||
BorgWarner, Inc.* | 45,830 | 3,282,345 | ||||||
DIRECTV* | 40,569 | 2,034,941 | ||||||
Dollar General Corp.* | 50,370 | 2,220,813 | ||||||
Gap, Inc. (The) | 97,125 | 3,014,760 | ||||||
Lululemon Athletica, Inc. (Canada)* | 22,045 | 1,680,490 | ||||||
Michael Kors Holdings Ltd. (Hong Kong) | 66,520 | 3,394,516 | ||||||
priceline.com, Inc.* | 3,605 | 2,239,426 | ||||||
Ralph Lauren Corp. | 14,335 | 2,149,103 | ||||||
Urban Outfitters, Inc.* | 45,930 | 1,807,805 | ||||||
VF Corp. | 10,930 | 1,650,102 | ||||||
Walt Disney Co. (The) | 36,090 | 1,796,921 | ||||||
Williams-Sonoma, Inc. | 42,270 | 1,850,158 | ||||||
Yum! Brands, Inc. | 31,395 | 2,084,628 | ||||||
31,412,273 | ||||||||
Industrials — 14.0% | ||||||||
Danaher Corp. | 51,260 | 2,865,434 | ||||||
Deere & Co. | 38,325 | 3,312,046 | ||||||
Flowserve Corp. | 16,640 | 2,442,752 | ||||||
Fluor Corp. | 41,010 | 2,408,927 | ||||||
Precision Castparts Corp. | 10,540 | 1,996,487 | ||||||
Rockwell Automation, Inc. | 41,675 | 3,500,283 | ||||||
Union Pacific Corp. | 27,570 | 3,466,100 | ||||||
United Technologies Corp. | 41,975 | 3,442,370 | ||||||
23,434,399 |
Health Care — 10.8% | ||||||||
Allergan, Inc. | 31,104 | 2,853,170 | ||||||
Celgene Corp.* | 31,171 | 2,453,781 | ||||||
Cerner Corp.* | 24,994 | 1,940,534 | ||||||
Express Scripts Holding Co.* | 40,131 | 2,167,074 | ||||||
Henry Schein, Inc.* | 48,631 | 3,912,850 | ||||||
Thermo Fisher Scientific, Inc. | 38,285 | 2,441,817 | ||||||
Varian Medical Systems, Inc.* | 34,296 | 2,408,951 | ||||||
18,178,177 |
Consumer Staples — 8.6% | ||||||||
Anheuser-Busch InBev N.V. (Belgium), ADR | 39,845 | 3,482,851 | ||||||
Diageo PLC (United Kingdom), ADR | 38,145 | 4,446,944 | ||||||
Estee Lauder Cos., Inc. (The) - Class A | 63,610 | 3,807,695 | ||||||
Walgreen Co. | 71,065 | 2,630,116 | ||||||
14,367,606 | ||||||||
Energy — 8.1% | ||||||||
Anadarko Petroleum Corp. | 31,780 | 2,361,572 | ||||||
Cameron International Corp.* | 57,460 | 3,244,192 | ||||||
Chevron Corp. | 19,065 | 2,061,689 | ||||||
Pioneer Natural Resources Co. | 24,603 | 2,622,434 | ||||||
Schlumberger Ltd. | 47,576 | 3,296,541 | ||||||
13,586,428 | ||||||||
Financials — 2.9% | ||||||||
Ameriprise Financial, Inc. | 28,752 | 1,800,738 | ||||||
US Bancorp | 94,415 | 3,015,615 | ||||||
4,816,353 | ||||||||
Materials — 2.1% | ||||||||
Monsanto Co. | 36,930 | 3,495,424 | ||||||
Total Common Stocks | $ | 164,577,532 | ||||||
Investment Fund — 1.9% | ||||||||
Touchstone Institutional Money Market Fund^ | 3,192,789 | 3,192,789 | ||||||
Total Investment Securities —100.2% | ||||||||
(Cost $118,595,520) | $ | 167,770,321 | ||||||
Liabilities in Excess of Other Assets — (0.2%) | (417,942 | ) | ||||||
Net Assets — 100.0% | $ | 167,352,379 |
* | Non-income producing security. |
^ | Affiliated Fund. See Note 4 in Notes to Financial Statements. |
Portfolio Abbreviations:
ADR - American Depositary Receipt
PLC - Public Limited Company
Other Information:
The inputs or methodology used for valuing securities may not be an indication of the risk associated with investing in those securities. For more information on valuation inputs, and their aggregation into the levels used in the table below, please refer to the security valuation section in the accompanying Notes to Financial Statements.
5 |
Touchstone Capital Growth Fund (Continued)
Valuation inputs at Reporting Date:
Description | Level 1 | Level 2 | Level 3 | Total | ||||||||||||
Common Stocks | $ | 164,577,532 | $ | — | $ | — | $ | 164,577,532 | ||||||||
Investment Fund | 3,192,789 | — | — | 3,192,789 | ||||||||||||
$ | 167,770,321 |
See accompanying Notes to Financial Statements.
6 |
Portfolio of Investments
Touchstone International Small Cap Fund – December 31, 2012 (Unaudited)
Market | ||||||||
Shares | Value | |||||||
Common Stocks — 97.8% | ||||||||
Japan — 19.5% | ||||||||
Alpen Co. Ltd. | 37,700 | $ | 662,565 | |||||
Anritsu Corp. | 71,000 | 843,478 | ||||||
Avex Group Holdings, Inc. | 47,900 | 966,513 | ||||||
Chiyoda Co. Ltd. | 23,000 | 575,685 | ||||||
COMSYS Holdings Corp. | 49,000 | 629,336 | ||||||
Credit Saison Co. Ltd. | 40,000 | 1,000,507 | ||||||
Daiichikosho Co. Ltd. | 25,000 | 579,731 | ||||||
Dena Co. Ltd. | 25,500 | 841,216 | ||||||
FP Corp. | 14,100 | 938,013 | ||||||
Fuji Media Holdings, Inc. | 851 | 1,286,256 | ||||||
Hoshizaki Electric Co. Ltd. | 49,400 | 1,313,516 | ||||||
Itochu Techno-Solutions Corp. | 20,300 | 835,921 | ||||||
Iwatani Corp. | 187,000 | 695,692 | ||||||
Japan Petroleum Exploration Co. | 18,200 | 642,779 | ||||||
Megane TOP Co. Ltd. | 105,100 | 1,242,450 | ||||||
Sawai Pharmaceutical Co. Ltd. | 6,500 | 652,480 | ||||||
Seria Co. Ltd. | 33,158 | 527,306 | ||||||
Ship Healthcare Holdings, Inc. | 29,500 | 784,057 | ||||||
Suzuken Co. Ltd. | 24,600 | 693,057 | ||||||
Tokyo Ohka Kogyo Co. Ltd. | 41,300 | 816,817 | ||||||
Toshiba Machine Co. Ltd. | 308,000 | 1,528,047 | ||||||
Toyo Engineering Corp. | 225,000 | 1,065,974 | ||||||
Weathernews, Inc.† | 34,700 | 955,456 | ||||||
20,076,852 | ||||||||
United Kingdom — 14.9% | ||||||||
Ashtead Group PLC | 167,848 | 1,180,553 | ||||||
Babcock International Group PLC | 49,241 | 777,274 | ||||||
Dialight PLC | 40,912 | 706,468 | ||||||
Elementis PLC | 242,339 | 925,314 | ||||||
Hargreaves Lansdown PLC | 103,554 | 1,158,198 | ||||||
ITV PLC | 617,507 | 1,071,236 | ||||||
Majestic Wine PLC | 115,090 | 884,914 | ||||||
Micro Focus International PLC | 137,438 | 1,312,396 | ||||||
Moneysupermarket.com Group PLC | 410,175 | 1,046,110 | ||||||
Paragon Group of Cos. PLC | 235,649 | 984,967 | ||||||
RPC Group PLC | 158,843 | 1,029,270 | ||||||
Savills PLC | 202,814 | 1,561,082 | ||||||
Spectris PLC | 25,149 | 848,700 | ||||||
Travis Perkins PLC | 40,717 | 729,571 | ||||||
TUI Travel PLC | 165,287 | 766,978 | ||||||
WS Atkins PLC | 31,666 | 394,603 | ||||||
15,377,634 | ||||||||
Australia — 6.7% | ||||||||
Ausdrill Ltd. | 295,718 | 883,021 | ||||||
DuluxGroup Ltd. | 307,327 | 1,218,724 | ||||||
FlexiGroup Ltd. | 292,834 | 1,131,232 | ||||||
GrainCorp Ltd., Class A | 71,400 | 925,901 | ||||||
Lend Lease Group | 123,441 | 1,205,503 | ||||||
Spark Infrastructure Group | 893,651 | 1,562,356 | ||||||
6,926,737 | ||||||||
Canada — 6.7% | ||||||||
Canyon Services Group, Inc.† | 81,604 | 931,140 | ||||||
Dollarama, Inc. | 12,382 | 734,057 |
Element Financial Corp.* | 126,530 | 903,150 | ||||||
Horizon North Logistics, Inc. | 197,200 | 1,361,982 | ||||||
Onex Corp. | 27,346 | 1,151,078 | ||||||
Westjet Airlines Ltd. | 89,941 | 1,791,225 | ||||||
6,872,632 | ||||||||
Germany — 6.0% | ||||||||
ADVA Optical Networking SE* | 103,732 | 547,602 | ||||||
Dialog Semiconductor PLC* | 56,423 | 999,487 | ||||||
Freenet AG | 60,472 | 1,120,764 | ||||||
Gerresheimer AG* | 28,011 | 1,488,372 | ||||||
Gerry Weber International AG | 15,419 | 746,836 | ||||||
KUKA AG* | 35,297 | 1,296,632 | ||||||
6,199,693 | ||||||||
Finland — 4.1% | ||||||||
Huhtamaki OYJ | 70,072 | 1,136,830 | ||||||
Kemira OYJ | 85,376 | 1,340,789 | ||||||
Outotec OYJ | 14,112 | 797,277 | ||||||
Pohjola Bank PLC, Class A | 60,320 | 903,213 | ||||||
4,178,109 | ||||||||
Denmark — 3.8% | ||||||||
GN Store Nord A/S | 81,973 | 1,191,313 | ||||||
Royal UNIBREW A/S | 13,055 | 1,139,396 | ||||||
Topdanmark A/S* | 7,539 | 1,619,805 | ||||||
3,950,514 | ||||||||
Austria — 3.6% | ||||||||
AMS AG | 14,596 | 1,571,910 | ||||||
Oesterreichische Post AG | 35,650 | 1,469,954 | ||||||
RHI AG | 20,000 | 658,594 | ||||||
3,700,458 | ||||||||
Bermuda — 3.5% | ||||||||
Biosensors International Group Ltd.* | 827,000 | 825,601 | ||||||
Catlin Group Ltd. | 132,624 | 1,091,191 | ||||||
Golar LNG Ltd. | 18,886 | 694,627 | ||||||
Lancashire Holdings Ltd. | 75,400 | 960,020 | ||||||
3,571,439 | ||||||||
Norway — 3.4% | ||||||||
Det Norske Oljeselskap ASA* | 57,474 | 862,720 | ||||||
Marine Harvest ASA* | 1,148,589 | 1,069,983 | ||||||
TGS Nopec Geophysical Co. ASA | 47,400 | 1,565,418 | ||||||
3,498,121 | ||||||||
Cayman Islands — 3.2% | ||||||||
MIE Holdings Corp. | 2,490,000 | 800,128 | ||||||
NagaCorp Ltd. | 1,334,000 | 815,002 | ||||||
Prince Frog International Holdings Ltd. | 1,526,712 | 650,400 | ||||||
Towngas China Co. Ltd. | 1,295,000 | 1,073,627 | ||||||
3,339,157 | ||||||||
Ireland — 2.7% | ||||||||
Glanbia PLC* | 73,265 | 807,501 | ||||||
Paddy Power PLC | 14,779 | 1,217,558 |
7 |
Touchstone International Small Cap Fund (Continued)
Market | ||||||||
Shares | Value | |||||||
Common Stocks — 97.8% (Continued) | ||||||||
Ireland — (Continued) | ||||||||
Smurfit Kappa Group PLC* | 64,000 | $ | 764,536 | |||||
2,789,595 | ||||||||
Luxembourg — 2.4% | ||||||||
AZ Electronic Materials SA | 205,085 | 1,179,968 | ||||||
Samsonite International SA | 608,100 | 1,276,151 | ||||||
2,456,119 | ||||||||
Thailand — 2.4% | ||||||||
Sansiri PCL | 7,043,082 | 813,449 | ||||||
Thai Tap Water Supply PCL | 2,769,602 | 837,017 | ||||||
Tisco Financial Group PCL | 470,000 | 804,175 | ||||||
2,454,641 | ||||||||
France — 2.4% | ||||||||
Plastic Omnium SA | 39,147 | 1,190,541 | ||||||
UBISOFT Entertainment* | 119,986 | 1,263,629 | ||||||
2,454,170 | ||||||||
Sweden — 2.0% | ||||||||
Boliden AB | 52,277 | 993,316 | ||||||
Fastighets AB Balder, Class B* | 179,858 | 1,037,566 | ||||||
2,030,882 | ||||||||
Switzerland — 1.9% | ||||||||
Aryzta AG | 20,105 | 1,034,511 | ||||||
Banque Cantonale Vaudoise | 1,698 | 904,305 | ||||||
1,938,816 | ||||||||
Belgium — 1.7% | ||||||||
Barco NV | 24,572 | 1,778,990 | ||||||
Korea — 1.7% | ||||||||
Hansae Co. Ltd. | 58,190 | 903,222 | ||||||
Paradise Co. Ltd. | 52,234 | 845,061 | ||||||
1,748,283 | ||||||||
Spain — 1.2% | ||||||||
Viscofan SA | 21,221 | 1,202,016 | ||||||
Netherlands — 1.1% | ||||||||
Nutreco NV | 12,839 | 1,091,485 | ||||||
Turkey — 0.8% | ||||||||
Dogus Otomotiv Servis ve Ticaret AS | 179,000 | 863,637 | ||||||
Italy — 0.8% | ||||||||
Recordati SpA | 88,000 | 804,651 | ||||||
Singapore — 0.7% | ||||||||
SATS Ltd. | 300,000 | 716,398 | ||||||
Cyprus — 0.6% | ||||||||
ProSafe SE | 77,010 | 660,767 | ||||||
Total Common Stocks | $ | 100,681,796 | ||||||
Exchange Traded Fund — 2.0% | ||||||||
iShares MSCI EAFE Small Cap Index Fund | 50,853 | 2,070,226 | ||||||
Investment Funds — 2.0% | ||||||||
Invesco Government & Agency Portfolio** | 1,601,443 | 1,601,443 | ||||||
Touchstone Institutional Money Market Fund^ | 474,812 | 474,812 | ||||||
Total Investment Funds | $ | 2,076,255 | ||||||
Total Investment Securities —101.8% | ||||||||
(Cost $92,432,029) | 104,828,277 | |||||||
Liabilities in Excess of Other Assets — (1.8%) | (1,881,215 | ) | ||||||
Net Assets — 100.0% | $ | 102,947,062 |
† | All or a portion of the security is on loan. The total value of the securities on loan as of December 31, 2012 was $1,542,936. |
* | Non-income producing security. |
** | Represents collateral for securities loaned. |
^ | Affiliated Fund. See Note 4 in Notes to Financial Statements. |
Portfolio Abbreviations:
PCL - Public Company Limited
PLC - Public Limited Company
Other Information:
The inputs or methodology used for valuing securities may not be an indication of the risk associated with investing in those securities. For more information on valuation inputs, and their aggregation into the levels used in the table below, please refer to the security valuation section in the accompanying Notes to Financial Statements.
8 |
Touchstone International Small Cap Fund (Continued)
Valuation inputs at Reporting Date:
Level 1 | Level 2 | Level 3 | Total | |||||||||||||
Common Stocks | ||||||||||||||||
Australia | $ | 1,131,232 | $ | 5,795,505 | $ | — | $ | 6,926,737 | ||||||||
Austria | — | 3,700,458 | — | 3,700,458 | ||||||||||||
Belgium | — | 1,778,990 | — | 1,778,990 | ||||||||||||
Bermuda | 694,627 | 2,876,812 | — | 3,571,439 | ||||||||||||
Canada | 6,872,632 | — | — | 6,872,632 | ||||||||||||
Cayman Islands | — | 3,339,157 | — | 3,339,157 | ||||||||||||
Cyprus | — | 660,767 | — | 660,767 | ||||||||||||
Denmark | — | 3,950,514 | — | 3,950,514 | ||||||||||||
Finland | — | 4,178,109 | — | 4,178,109 | ||||||||||||
France | — | 2,454,170 | — | 2,454,170 | ||||||||||||
Germany | — | 6,199,693 | — | 6,199,693 | ||||||||||||
Ireland | 807,501 | 1,982,094 | — | 2,789,595 | ||||||||||||
Italy | — | 804,651 | — | 804,651 | ||||||||||||
Japan | 579,731 | 19,497,121 | — | 20,076,852 | ||||||||||||
Korea | — | 1,748,283 | — | 1,748,283 | ||||||||||||
Luxembourg | — | 2,456,119 | — | 2,456,119 | ||||||||||||
Netherlands | — | 1,091,485 | — | 1,091,485 | ||||||||||||
Norway | — | 3,498,121 | — | 3,498,121 | ||||||||||||
Singapore | — | 716,398 | — | 716,398 | ||||||||||||
Spain | — | 1,202,016 | — | 1,202,016 | ||||||||||||
Sweden | — | 2,030,882 | — | 2,030,882 | ||||||||||||
Switzerland | — | 1,938,816 | — | 1,938,816 | ||||||||||||
Thailand | — | 2,454,641 | — | 2,454,641 | ||||||||||||
Turkey | — | 863,637 | — | 863,637 | ||||||||||||
United Kingdom | 1,752,578 | 13,625,056 | — | 15,377,634 | ||||||||||||
Exchanged Traded Fund | 2,070,226 | — | — | 2,070,226 | ||||||||||||
Investment Funds | 2,076,255 | — | — | 2,076,255 | ||||||||||||
$ | 104,828,277 |
At December 31, 2012 securities valued at $2,883,810 were transferred from Level 2 to Level 1 pursuant to Fund's fair valuation policy.
See accompanying Notes to Financial Statements
9 |
Portfolio of Investments
Touchstone Mid Cap Value Opportunities Fund – December 31, 2012 (Unaudited)
Market | ||||||||
Shares | Value | |||||||
Common Stocks — 95.9% | ||||||||
Financials — 18.1% | ||||||||
Allstate Corp. (The) | 46,500 | $ | 1,867,905 | |||||
Annaly Capital Management, Inc. REIT | 194,700 | 2,733,588 | ||||||
Aon PLC (Great Britain) | 26,409 | 1,468,340 | ||||||
Everest Re Group Ltd. (Bermuda) | 19,400 | 2,133,030 | ||||||
First Republic Bank | 75,000 | 2,458,500 | ||||||
HCC Insurance Holdings, Inc. | 38,600 | 1,436,306 | ||||||
Loews Corp. | 47,800 | 1,947,850 | ||||||
Progressive Corp. (The) | 78,000 | 1,645,800 | ||||||
Willis Group Holdings PLC | 38,020 | 1,274,811 | ||||||
16,966,130 | ||||||||
Information Technology — 17.5% | ||||||||
Activision Blizzard, Inc. | 110,700 | 1,175,634 | ||||||
Amdocs Ltd. (Guernsey)* | 56,300 | 1,913,637 | ||||||
Applied Materials, Inc. | 63,700 | 728,728 | ||||||
CA, Inc. | 74,800 | 1,644,104 | ||||||
Dolby Laboratories, Inc. - Class A† | 45,000 | 1,319,850 | ||||||
FleetCor Technologies, Inc.* | 9,500 | 509,675 | ||||||
Global Payments, Inc. | 42,400 | 1,920,720 | ||||||
KLA-Tencor Corp. | 30,700 | 1,466,232 | ||||||
Lam Research Corp.* | 39,200 | 1,416,296 | ||||||
Micron Technology, Inc.* | 112,900 | 716,915 | ||||||
Symantec Corp.* | 73,900 | 1,390,059 | ||||||
Western Digital Corp. | 28,600 | 1,215,214 | ||||||
Western Union Co. (The) | 69,000 | 939,090 | ||||||
16,356,154 | ||||||||
Utilities — 13.0% | ||||||||
Alliant Energy Corp. | 52,700 | 2,314,057 | ||||||
American Water Works Co., Inc. | 37,400 | 1,388,662 | ||||||
CenterPoint Energy, Inc. | 99,450 | 1,914,412 | ||||||
CMS Energy Corp. | 116,100 | 2,830,518 | ||||||
Westar Energy, Inc. | 17,300 | 495,126 | ||||||
Wisconsin Energy Corp. | 43,800 | 1,614,030 | ||||||
Xcel Energy, Inc. | 61,500 | 1,642,665 | ||||||
12,199,470 | ||||||||
Health Care — 12.3% | ||||||||
AmerisourceBergen Corp. | 43,400 | 1,874,012 | ||||||
CIGNA Corp. | 19,000 | 1,015,740 | ||||||
Endo Health Solutions, Inc.* | 82,456 | 2,166,119 | ||||||
Forest Laboratories, Inc.* | 33,100 | 1,169,092 | ||||||
Humana, Inc. | 17,100 | 1,173,573 | ||||||
MEDNAX, Inc.* | 17,800 | 1,415,456 | ||||||
Questcor Pharmaceuticals, Inc.† | 30,600 | 817,632 | ||||||
United Therapeutics Corp.* | 13,700 | 731,854 | ||||||
Zimmer Holdings, Inc. | 17,700 | 1,179,882 | ||||||
11,543,360 | ||||||||
Consumer Discretionary — 12.2% | ||||||||
Best Buy Co., Inc. | 87,100 | 1,032,135 | ||||||
Cablevision Systems Corp. - Class A | 98,500 | 1,471,590 | ||||||
GameStop Corp. - Class A† | 42,032 | 1,054,584 | ||||||
H&R Block, Inc. | 95,934 | 1,781,494 | ||||||
Interpublic Group of Cos, Inc. (The) | 62,900 | 693,158 | ||||||
Lear Corp. | 31,100 | 1,456,724 |
Liberty Interactive Corp. - Class A* | 36,300 | 714,384 | ||||||
Liberty Media Corp. - Liberty Capital - Class A* | 15,300 | 1,774,953 | ||||||
Staples, Inc. | 124,700 | 1,421,580 | ||||||
11,400,602 | ||||||||
Industrials — 7.9% | ||||||||
Dun & Bradstreet Corp. (The) | 17,400 | 1,368,510 | ||||||
Northrop Grumman Corp. | 14,000 | 946,120 | ||||||
Pitney Bowes, Inc.† | 100,900 | 1,073,576 | ||||||
Southwest Airlines Co. | 113,700 | 1,164,288 | ||||||
Towers Watson & Co. - Class A | 29,200 | 1,641,332 | ||||||
URS Corp. | 30,800 | 1,209,208 | ||||||
7,403,034 | ||||||||
Materials — 6.2% | ||||||||
Bemis Co., Inc. | 56,600 | 1,893,836 | ||||||
CF Industries Holdings, Inc. | 4,500 | 914,220 | ||||||
Crown Holdings, Inc.* | 37,900 | 1,395,099 | ||||||
MeadWestvaco Corp. | 29,900 | 952,913 | ||||||
Sealed Air Corp. | 40,400 | 707,404 | ||||||
5,863,472 | ||||||||
Energy — 5.0% | ||||||||
Energy XXI Bermuda Ltd. (Bermuda) | 22,200 | 714,618 | ||||||
HollyFrontier Corp. | 16,100 | 749,455 | ||||||
Murphy Oil Corp. | 8,400 | 500,220 | ||||||
Valero Energy Corp. | 26,900 | 917,828 | ||||||
Williams Cos., Inc. (The) | 53,900 | 1,764,686 | ||||||
4,646,807 | ||||||||
Consumer Staples — 2.0% | ||||||||
Dr Pepper Snapple Group, Inc. | 42,300 | 1,868,814 | ||||||
Telecommunication Services — 1.7% | ||||||||
Windstream Corp.† | 188,900 | 1,564,092 | ||||||
Total Common Stocks | $ | 89,811,935 | ||||||
Investment Funds — 9.2% | ||||||||
Invesco Government & Agency Portfolio** | 6,249,304 | 6,249,304 | ||||||
Touchstone Institutional Money Market Fund^ | 2,364,744 | 2,364,744 | ||||||
Total Investment Funds | $ | 8,614,048 | ||||||
Total Investment Securities —105.1% | ||||||||
(Cost $86,956,686) | $ | 98,425,983 | ||||||
Liabilities in Excess of Other Assets — (5.1%) | (4,813,958 | ) | ||||||
Net Assets — 100.0% | $ | 93,612,025 |
† | All or a portion of the security is on loan. The total value of the securities on loan as of December 31, 2012 was $5,742,445. |
10 |
Touchstone Mid Cap Value Opportunities Fund (Continued)
* | Non-income producing security. |
** | Represents collateral for securities loaned. |
^ | Affiliated Fund. See Note 4 in Notes to Financial Statements. |
Portfolio Abbreviations:
PLC - Public Liability Company
REIT - Real Estate Investment Trust
Other Information:
The inputs or methodology used for valuing securities may not be an indication of the risk associated with investing in those securities. For more information on valuation inputs, and their aggregation into the levels used in the table below, please refer to the security valuation section in the accompanying Notes to Financial Statements.
Valuation inputs at Reporting Date:
Description | Level 1 | Level 2 | Level 3 | Total | ||||||||||||
Common Stocks | $ | 89,811,935 | $ | — | $ | — | $ | 89,811,935 | ||||||||
Investment Funds | 8,614,048 | — | — | 8,614,048 | ||||||||||||
$ | 98,425,983 |
See accompanying Notes to Financial Statements.
11 |
Portfolio of Investments
Touchstone Small Cap Value Opportunities Fund – December 31, 2012 (Unaudited)
Market | ||||||||
Shares | Value | |||||||
Common Stocks — 96.7% | ||||||||
Financials — 23.2% | ||||||||
American Equity Investment Life Holding Co. | 130,900 | $ | 1,598,289 | |||||
Aspen Insurance Holdings Ltd. | 27,200 | 872,576 | ||||||
Astoria Financial Corp. | 68,400 | 640,224 | ||||||
Brandywine Realty Trust REIT | 65,600 | 799,664 | ||||||
Capstead Mortgage Corp. REIT | 93,200 | 1,069,004 | ||||||
Cash America International, Inc. | 25,250 | 1,001,668 | ||||||
City Holding Co. | 16,200 | 564,570 | ||||||
Columbia Banking System, Inc. | 60,100 | 1,078,194 | ||||||
DFC Global Corp.* | 61,500 | 1,138,365 | ||||||
First Cash Financial Services, Inc.* | 28,000 | 1,389,360 | ||||||
First Commonwealth Financial Corp. | 114,600 | 781,572 | ||||||
Horace Mann Educators Corp. | 40,700 | 812,372 | ||||||
Iberiabank Corp. | 33,600 | 1,650,432 | ||||||
LaSalle Hotel Properties REIT | 35,700 | 906,423 | ||||||
Netspend Holdings, Inc.* | 93,200 | 1,101,624 | ||||||
Omega Healthcare Investors, Inc. REIT | 29,800 | 710,730 | ||||||
PS Business Parks, Inc. REIT | 13,700 | 890,226 | ||||||
SVB Financial Group* | 22,200 | 1,242,534 | ||||||
Texas Capital Bancshares, Inc.* | 24,600 | 1,102,572 | ||||||
Tower Group, Inc. | 50,300 | 893,831 | ||||||
Wintrust Financial Corp. | 44,700 | 1,640,490 | ||||||
21,884,720 | ||||||||
Industrials — 18.3% | ||||||||
Acacia Research Corp.* | 47,500 | 1,218,375 | ||||||
ACCO Brands Corp.* | 124,100 | 910,894 | ||||||
Actuant Corp. - Class A | 39,850 | 1,112,214 | ||||||
Atlas Air Worldwide Holdings, Inc.* | 17,300 | 766,563 | ||||||
Avis Budget Group, Inc.* | 49,500 | 981,090 | ||||||
Brink's Co. (The) | 43,600 | 1,243,908 | ||||||
Con-way, Inc. | 34,600 | 962,572 | ||||||
DigitalGlobe, Inc.†* | 42,500 | 1,038,700 | ||||||
DXP Enterprises, Inc.* | 20,950 | 1,028,016 | ||||||
Encore Capital Group, Inc.* | 57,400 | 1,757,588 | ||||||
Generac Holdings, Inc. | 42,000 | 1,441,020 | ||||||
Hawaiian Holdings, Inc.* | 132,500 | 870,525 | ||||||
Hexcel Corp.* | 50,500 | 1,361,480 | ||||||
Kelly Services, Inc. - Class A | 66,200 | 1,041,988 | ||||||
Sykes Enterprises, Inc.* | 23,850 | 362,997 | ||||||
Tennant Co. | 27,900 | 1,226,205 | ||||||
17,324,135 | ||||||||
Consumer Discretionary — 17.6% | ||||||||
Barnes & Noble, Inc.†* | 85,100 | 1,284,159 | ||||||
Coinstar, Inc.†* | 29,700 | 1,544,697 | ||||||
Cooper Tire & Rubber Co. | 71,100 | 1,803,096 | ||||||
Finish Line, Inc. (The) - Class A | 56,000 | 1,060,080 | ||||||
Gentherm, Inc.* | 74,000 | 984,200 | ||||||
G-III Apparel Group Ltd.* | 20,600 | 705,138 | ||||||
Jack in Box, Inc.* | 47,600 | 1,361,360 | ||||||
Krispy Kreme Doughnuts, Inc.* | 103,300 | 968,954 | ||||||
Men's Wearhouse, Inc. (The) | 50,600 | 1,576,696 | ||||||
Multimedia Games Holding Co., Inc.* | 75,200 | 1,106,192 | ||||||
Rent-A-Center, Inc. TX | 42,300 | 1,453,428 | ||||||
SHFL Entertainment, Inc.* | 66,700 | 967,150 | ||||||
Shutterfly, Inc.* | 47,000 | 1,403,890 | ||||||
VOXX International Corp.* | 59,600 | 401,108 | ||||||
16,620,148 | ||||||||
Information Technology — 12.6% | ||||||||
Cardtronics, Inc.* | 55,800 | 1,324,692 | ||||||
Dealertrack Technologies, Inc.* | 43,000 | 1,234,960 | ||||||
Ebix, Inc.† | 38,400 | 617,088 | ||||||
Emulex Corp.* | 127,800 | 932,940 | ||||||
GT Advanced Technologies, Inc.†* | 116,300 | 351,225 | ||||||
Kulicke & Soffa Industries, Inc.* | 102,550 | 1,229,574 | ||||||
Logitech International-Reg†* | 130,000 | 980,200 | ||||||
MoneyGram International, Inc.* | 61,600 | 818,664 | ||||||
Netscout Systems, Inc.* | 43,900 | 1,140,961 | ||||||
Silicon Image, Inc.* | 222,000 | 1,101,120 | ||||||
TiVo, Inc.* | 100,200 | 1,234,464 | ||||||
Tyler Technologies, Inc.* | 18,900 | 915,516 | ||||||
11,881,404 | ||||||||
Health Care — 6.4% | ||||||||
Acadia Healthcare Co., Inc.* | 57,600 | 1,343,808 | ||||||
Air Methods Corp. | 32,700 | 1,206,303 | ||||||
Amsurg Corp.* | 28,000 | 840,280 | ||||||
Questcor Pharmaceuticals, Inc.† | 36,400 | 972,608 | ||||||
Santarus, Inc.* | 94,600 | 1,038,708 | ||||||
Universal American Corp. NY | 77,600 | 666,584 | ||||||
6,068,291 | ||||||||
Materials — 4.9% | ||||||||
American Vanguard Corp. | 30,600 | 950,742 | ||||||
Noranda Aluminum Holding Corp. | 142,800 | 872,508 | ||||||
PH Glatfelter Co. | 52,400 | 915,952 | ||||||
PolyOne Corp. | 35,500 | 724,910 | ||||||
Schweitzer-Mauduit International, Inc. | 30,328 | 1,183,702 | ||||||
4,647,814 | ||||||||
Energy — 4.9% | ||||||||
Energy XXI Bermuda Ltd. | 34,800 | 1,120,212 | ||||||
Helix Energy Solutions Group, Inc.* | 80,700 | 1,665,648 | ||||||
Newpark Resources, Inc.* | 109,500 | 859,575 | ||||||
Western Refining, Inc.† | 33,500 | 944,365 | ||||||
4,589,800 | ||||||||
Utilities — 4.1% | ||||||||
NorthWestern Corp. | 51,100 | 1,774,703 | ||||||
PNM Resources, Inc. | 46,500 | 953,715 | ||||||
UNS Energy Corp. | 27,600 | 1,170,792 | ||||||
3,899,210 | ||||||||
Consumer Staples — 3.3% | ||||||||
Andersons, Inc. (The) | 26,500 | 1,136,850 | ||||||
Medifast, Inc.* | 40,100 | 1,058,239 | ||||||
Universal Corp. | 19,000 | 948,290 | ||||||
3,143,379 |
12 |
Touchstone Small Cap Value Opportunities Fund (Continued)
Market | ||||||||
Shares | Value | |||||||
Common Stocks — 96.7% (Continued) | ||||||||
Telecommunication Services — 1.4% | ||||||||
magicJack VocalTec Ltd.†* | 72,200 | $ | 1,314,762 | |||||
Total Common Stocks | $ | 91,373,663 | ||||||
Exchange Traded Fund — 1.3% | ||||||||
iShares Russell 2000 Value Index Fund | 16,000 | 1,208,160 | ||||||
Investment Funds — 11.3% | ||||||||
Invesco Government & Agency Portfolio** | 8,660,912 | 8,660,912 | ||||||
Touchstone Institutional Money Market Fund^ | 2,071,425 | 2,071,425 | ||||||
Total Investment Funds | $ | 10,732,337 | ||||||
Total Investment Securities —109.3% | ||||||||
(Cost $94,444,689) | $ | 103,314,160 | ||||||
Liabilities in Excess of Other Assets — (9.3%) | (8,783,248 | ) | ||||||
Net Assets — 100.0% | $ | 94,530,912 |
† | All or a portion of the security is on loan. The total value of the securities on loan as of December 31, 2012 was $8,566,841. |
* | Non-income producing security. |
** | Represents collateral for securities loaned. |
^ | Affiliated Fund. See Note 4 in Notes to Financial Statements. |
Portfolio Abbreviations:
REIT - Real Estate Investment Trust
Other Information:
The inputs or methodology used for valuing securities may not be an indication of the risk associated with investing in those securities. For more information on valuation inputs, and their aggregation into the levels used in the table below, please refer to the security valuation section in the accompanying Notes to Financial Statements.
Valuation inputs at Reporting Date:
Description | Level 1 | Level 2 | Level 3 | Total | ||||||||||||
Common Stocks | $ | 91,373,663 | $ | — | $ | — | $ | 91,373,663 | ||||||||
Exchanged Traded Fund | 1,208,160 | — | — | 1,208,160 | ||||||||||||
Investment Funds | 10,732,337 | — | — | 10,732,337 | ||||||||||||
$ | 103,314,160 |
See accompanying Notes to Financial Statements.
13 |
Portfolio of Investments
Touchstone U.S. Long/Short Fund – December 31, 2012 (Unaudited)
Market | ||||||||
Shares | Value | |||||||
Common Stocks† — 118.3% | ||||||||
Information Technology — 25.1% | ||||||||
AOL, Inc. | 3,850 | $ | 113,998 | |||||
Apple, Inc. | 985 | 525,035 | ||||||
CA, Inc. | 4,075 | 89,568 | ||||||
Cadence Design Systems, Inc.* | 3,025 | 40,868 | ||||||
Harris Corp. | 9,723 | 476,038 | ||||||
Intel Corp. | 925 | 19,083 | ||||||
International Business Machines Corp. | 3,756 | 719,462 | ||||||
KLA-Tencor Corp. | 1,147 | 54,781 | ||||||
Microsoft Corp. | 13,880 | 371,012 | ||||||
Seagate Technology PLC | 12,607 | 384,261 | ||||||
Symantec Corp.* | 13,972 | 262,813 | ||||||
3,056,919 | ||||||||
Consumer Discretionary — 20.4% | ||||||||
American Eagle Outfitters, Inc. | 1,265 | 25,945 | ||||||
Brinker International, Inc. | 1,096 | 33,965 | ||||||
Comcast Corp. - Class A | 5,823 | 217,664 | ||||||
Delphi Automotive PLC* | 14,153 | 541,352 | ||||||
Gap, Inc. (The) | 6,625 | 205,640 | ||||||
General Motors Co.* | 7,833 | 225,825 | ||||||
Goodyear Tire & Rubber Co. (The)* | 4,892 | 67,559 | ||||||
Home Depot, Inc. (The) | 3,212 | 198,662 | ||||||
Jarden Corp. | 3,293 | 170,248 | ||||||
Liberty Interactive Corp. - Class A* | 4,946 | 97,337 | ||||||
Macy's, Inc. | 3,726 | 145,389 | ||||||
Marriott International, Inc. - Class A | 6,126 | 228,316 | ||||||
Viacom, Inc. - Class B | 596 | 31,433 | ||||||
Virgin Media, Inc. | 7,890 | 289,958 | ||||||
2,479,293 | ||||||||
Energy — 15.8% | ||||||||
Chevron Corp. | 6,845 | 740,218 | ||||||
Exxon Mobil Corp. | 9,044 | 782,758 | ||||||
Marathon Oil Corp. | 7,600 | 233,016 | ||||||
Tesoro Corp. | 3,946 | 173,821 | ||||||
1,929,813 | ||||||||
Financials — 14.5% | ||||||||
American International Group, Inc.* | 16,726 | 590,429 | ||||||
Bank of America Corp. | 28,661 | 332,468 | ||||||
Citigroup, Inc. | 4,867 | 192,539 | ||||||
KeyCorp | 11,434 | 96,274 | ||||||
Popular, Inc.* | 1,279 | 26,590 | ||||||
Regions Financial Corp. | 3,652 | 26,002 | ||||||
Weyerhaeuser Co. REIT | 18,004 | 500,871 | ||||||
1,765,173 | ||||||||
Health Care — 13.9% | ||||||||
AmerisourceBergen Corp. | 3,029 | 130,792 | ||||||
Amgen, Inc. | 6,618 | 571,266 | ||||||
Cardinal Health, Inc. | 11,881 | 489,260 | ||||||
Charles River Laboratories International, Inc.* | 637 | 23,868 | ||||||
HCA Holdings, Inc. | 11,220 | 338,507 | ||||||
Mylan, Inc.* | 4,999 | 137,373 | ||||||
1,691,066 | ||||||||
Consumer Staples — 8.8% | ||||||||
Bunge Ltd. | 2,839 | 206,368 | ||||||
Dean Foods Co.* | 10,008 | 165,232 | ||||||
Herbalife Ltd. | 2,369 | 78,036 | ||||||
Nu Skin Enterprises, Inc. - Class A | 4,747 | 175,876 | ||||||
Philip Morris International, Inc. | 1,316 | 110,070 | ||||||
Safeway, Inc. | 18,272 | 330,541 | ||||||
1,066,123 | ||||||||
Industrials — 8.4% | ||||||||
Con-way, Inc. | 175 | 4,868 | ||||||
Crane Co. | 705 | 32,627 | ||||||
Delta Air Lines, Inc.* | 8,193 | 97,252 | ||||||
General Cable Corp.* | 1,145 | 34,819 | ||||||
General Electric Co. | 26,394 | 554,010 | ||||||
Pitney Bowes, Inc. | 2,195 | 23,355 | ||||||
Textron, Inc. | 10,426 | 258,461 | ||||||
United Parcel Service, Inc. - Class B | 277 | 20,423 | ||||||
1,025,815 | ||||||||
Materials — 7.1% | ||||||||
Ball Corp. | 11,326 | 506,838 | ||||||
Commercial Metals Co. | 9,248 | 137,425 | ||||||
Crown Holdings, Inc.* | 275 | 10,123 | ||||||
Freeport-McMoRan Copper & Gold, Inc. | 5,832 | 199,454 | ||||||
Huntsman Corp. | 748 | 11,893 | ||||||
865,733 | ||||||||
Utilities — 2.4% | ||||||||
AES Corp. | 25,695 | 274,936 | ||||||
Pinnacle West Capital Corp. | 325 | 16,568 | ||||||
291,504 | ||||||||
Telecommunication Services — 1.9% | ||||||||
MetroPCS Communications, Inc.* | 4,908 | 48,786 | ||||||
Sprint Nextel Corp.* | 19,099 | 108,291 | ||||||
Verizon Communications, Inc. | 1,606 | 69,492 | ||||||
226,569 | ||||||||
Total Common Stocks | $ | 14,398,008 | ||||||
Exchange Traded Fund — 1.7% | ||||||||
SPDR S&P 500 ETF Trust† | 1,472 | 209,789 | ||||||
Total Exchange Traded Funds | $ | 209,789 | ||||||
Investment Fund — 0.0% | ||||||||
Touchstone Institutional Money Market Fund^ | 7 | 7 | ||||||
Total Long Positions | ||||||||
(Cost $13,084,283) | $ | 14,607,804 | ||||||
Securities Sold Short — (20.7%) | ||||||||
Common Stocks — (20.7%) | ||||||||
Consumer Discretionary — (5.5%) | ||||||||
Abercrombie & Fitch Co. - Class A | (2,396 | ) | (114,936 | ) | ||||
Gentex Corp. | (12,712 | ) | (239,239 | ) | ||||
Pandora Media, Inc.* | (7,070 | ) | (64,903 | ) |
14 |
Touchstone U.S. Long/Short Fund (Continued)
Market | ||||||||
Shares | Value | |||||||
Common Stocks — (20.7%) (Continued) | ||||||||
Consumer Discretionary — (Continued) | ||||||||
Visteon Corp.* | (4,546 | ) | $ | (244,666 | ) | |||
(663,744 | ) | |||||||
Energy — (4.6%) | ||||||||
Alpha Natural Resources, Inc.* | (17,982 | ) | (175,145 | ) | ||||
Cheniere Energy, Inc.* | (10,408 | ) | (195,462 | ) | ||||
Ultra Petroleum Corp.* | (10,749 | ) | (194,879 | ) | ||||
(565,486 | ) | |||||||
Information Technology — (4.2%) | ||||||||
Acme Packet, Inc.* | (10,060 | ) | (222,527 | ) | ||||
Informatica Corp.* | (8,719 | ) | (264,360 | ) | ||||
Zynga, Inc. - Class A* | (8,375 | ) | (19,849 | ) | ||||
(506,736 | ) | |||||||
Health Care — (3.9%) | ||||||||
Allscripts Healthcare Solutions, Inc.* | (13,140 | ) | (123,779 | ) | ||||
Ariad Pharmaceuticals, Inc.* | (4,487 | ) | (86,061 | ) | ||||
Incyte Corp. Ltd.* | (12,890 | ) | (214,102 | ) | ||||
Warner Chilcott PLC - Class A | (4,141 | ) | (49,858 | ) | ||||
(473,800 | ) | |||||||
Materials — (2.5%) | ||||||||
Cliffs Natural Resources, Inc. | (1,102 | ) | (42,493 | ) | ||||
Walter Energy, Inc. | (7,260 | ) | (260,489 | ) | ||||
(302,982 | ) | |||||||
Total Common Stocks | $ | (2,512,748 | ) | |||||
Total Securities Sold Short | ||||||||
(Proceeds $(2,541,098)) | $ | (2,512,748 | ) | |||||
Total Investment Securities —99.3% | ||||||||
(Cost $10,543,185) | $ | 12,095,056 | ||||||
Other Assets in Excess of Liabilities — 0.7% | 79,379 | |||||||
Net Assets — 100.0% | $ | 12,174,435 |
† | All or a portion of these securities are held as collateral for securities sold short. The total value of the securities held as collateral as of December 31, 2012 was $14,607,797. |
* | Non-income producing security. |
^ | Affiliated Fund. See Note 4 in Notes to Financial Statements. |
Portfolio Abbreviations:
ADR - American Depositary Receipt
PLC - Public Limited Company
REIT - Real Estate Investment Trust
Other Information:
The inputs or methodology used for valuing securities may not be an indication of the risk associated with investing in those securities. For more information on valuation inputs, and their aggregation into the levels used in the table below, please refer to the security valuation section in the accompanying Notes to Financial Statements.
Valuation inputs at Reporting Date:
Description | Level 1 | Level 2 | Level 3 | Total | ||||||||||||
Assets: | ||||||||||||||||
Common Stocks | $ | 14,398,008 | $ | — | $ | — | $ | 14,398,008 | ||||||||
Exchanged Traded Fund | 209,789 | — | — | 209,789 | ||||||||||||
Investment Fund | 7 | — | — | 7 | ||||||||||||
$ | 14,607,804 | |||||||||||||||
Liabilities: | ||||||||||||||||
Securities Sold Short | ||||||||||||||||
Common Stocks | $ | (2,512,748 | ) | $ | — | $ | — | $ | (2,512,748 | ) |
See accompanying Notes to Financial Statements.
15 |
Portfolio of Investments
Touchstone Value Fund – December 31, 2012 (Unaudited)
Market | ||||||||
Shares | Value | |||||||
Common Stocks — 98.6% | ||||||||
Financials — 22.4% | ||||||||
American Express Co. | 169,842 | $ | 9,762,518 | |||||
Bank of America Corp. | 380,153 | 4,409,775 | ||||||
Capital One Financial Corp. | 114,020 | 6,605,179 | ||||||
Citigroup, Inc. | 166,240 | 6,576,454 | ||||||
JPMorgan Chase & Co. | 227,457 | 10,001,284 | ||||||
PNC Financial Services Group, Inc. | 139,286 | 8,121,767 | ||||||
SLM Corp. | 388,668 | 6,657,883 | ||||||
Wells Fargo & Co. | 293,785 | 10,041,571 | ||||||
XL Group PLC | 254,971 | 6,389,573 | ||||||
68,566,004 | ||||||||
Health Care — 14.8% | ||||||||
Baxter International, Inc. | 145,838 | 9,721,561 | ||||||
Johnson & Johnson | 121,240 | 8,498,924 | ||||||
Medtronic, Inc. | 217,310 | 8,914,056 | ||||||
Pfizer, Inc. | 443,224 | 11,116,059 | ||||||
WellPoint, Inc. | 119,432 | 7,275,797 | ||||||
45,526,397 | ||||||||
Energy — 13.7% | ||||||||
BP PLC ADR | 55,300 | 2,302,692 | ||||||
ConocoPhillips | 137,585 | 7,978,554 | ||||||
Marathon Petroleum Corp. | 79,210 | 4,990,230 | ||||||
Occidental Petroleum Corp. | 96,522 | 7,394,550 | ||||||
Phillips 66 | 147,847 | 7,850,676 | ||||||
Seadrill Ltd. | 90,490 | 3,330,032 | ||||||
Spectra Energy Corp. | 295,482 | 8,090,297 | ||||||
41,937,031 | ||||||||
Industrials — 13.2% | ||||||||
Emerson Electric Co. | 107,450 | 5,690,552 | ||||||
Exelis, Inc. | 100,000 | 1,127,000 | ||||||
General Electric Co. | 383,220 | 8,043,788 | ||||||
Honeywell International, Inc. | 119,158 | 7,562,958 | ||||||
Illinois Tool Works, Inc. | 84,135 | 5,116,249 | ||||||
ITT Corp. | 58,300 | 1,367,718 | ||||||
Raytheon Co. | 136,250 | 7,842,550 | ||||||
Xylem, Inc. | 136,230 | 3,691,833 | ||||||
40,442,648 | ||||||||
Consumer Staples — 11.5% | ||||||||
Altria Group, Inc. | 154,042 | 4,840,000 | ||||||
Diageo PLC ADR | 70,392 | 8,206,299 | ||||||
Imperial Tobacco Group PLC ADR | 115,637 | 8,960,711 | ||||||
Philip Morris International, Inc. | 158,650 | 13,269,486 | ||||||
35,276,496 | ||||||||
Utilities — 7.3% | ||||||||
CenterPoint Energy, Inc. | 334,390 | 6,437,008 | ||||||
Dominion Resources, Inc. VA | 37,354 | 1,934,937 | ||||||
Entergy Corp. | 112,510 | 7,172,512 | ||||||
Public Service Enterprise Group, Inc. | 225,890 | 6,912,234 | ||||||
22,456,691 | ||||||||
Telecommunication Services — 5.8% | ||||||||
AT&T, Inc. | 246,524 | 8,310,324 | ||||||
Verizon Communications, Inc. | 127,538 | 5,518,569 | ||||||
Vodafone Group PLC ADR | 159,940 | 4,028,889 | ||||||
17,857,782 | ||||||||
Information Technology — 5.4% | ||||||||
Intel Corp. | 136,790 | 2,821,978 | ||||||
International Business Machines Corp. | 31,320 | 5,999,346 | ||||||
Microsoft Corp. | 290,430 | 7,763,194 | ||||||
16,584,518 | ||||||||
Consumer Discretionary — 3.7% | ||||||||
Carnival Corp. | 135,368 | 4,977,481 | ||||||
Service Corp. International | 242,211 | 3,344,935 | ||||||
Target Corp. | 51,520 | 3,048,438 | ||||||
11,370,854 | ||||||||
Materials — 0.8% | ||||||||
EI du Pont de Nemours & Co. | 55,750 | 2,507,078 | ||||||
Total Common Stocks | $ | 302,525,499 | ||||||
Investment Fund — 1.3% | ||||||||
Touchstone Institutional Money Market Fund^ | 3,970,461 | 3,970,461 | ||||||
Total Investment Securities —99.9% | ||||||||
(Cost $273,858,086) | $ | 306,495,960 | ||||||
Other Assets in Excess of Liabilities — 0.1% | 358,141 | |||||||
Net Assets — 100.0% | $ | 306,854,101 |
^ | Affiliated Fund. See Note 4 in Notes to Financial Statements. |
Portfolio Abbreviations:
ADR - American Depositary Receipt
PLC - Public Limited Company
Other Information:
The inputs or methodology used for valuing securities may not be an indication of the risk associated with investing in those securities. For more information on valuation inputs, and their aggregation into the levels used in the table below, please refer to the security valuation section in the accompanying Notes to Financial Statements.
16 |
Touchstone Value Fund (Continued)
Valuation inputs at Reporting Date:
Description | Level 1 | Level 2 | Level 3 | Total | ||||||||||||
Common Stocks | $ | 302,525,499 | $ | — | $ | — | $ | 302,525,499 | ||||||||
Investment Fund | 3,970,461 | — | — | 3,970,461 | ||||||||||||
$ | 306,495,960 |
See accompanying Notes to Financial Statements.
17 |
Statements of Assets and Liabilities
December 31, 2012 (Unaudited)
Touchstone | Touchstone | |||||||
Capital | International | |||||||
Growth | Small Cap | |||||||
Fund | Fund | |||||||
Assets | ||||||||
Investments, at cost | $ | 118,595,520 | $ | 92,432,029 | ||||
Affiliated securities, at market value | $ | 3,192,789 | $ | 474,812 | ||||
Non-affiliated securities, at market value | 164,577,532 | 104,353,465 | ||||||
Investments, at value (A) | $ | 167,770,321 | $ | 104,828,277 | ||||
Cash | — | — | ||||||
Cash deposits held at prime broker | — | — | ||||||
Dividends and interest receivable | 93,093 | 74,735 | ||||||
Receivable for capital shares sold | 144,607 | 12,194 | ||||||
Receivable for investments sold | — | 135,881 | ||||||
Receivable for securities lending income | 13 | 3,279 | ||||||
Receivable from Investment Advisor | — | — | ||||||
Tax reclaim receivable | — | 71,649 | ||||||
Other assets | 23,024 | 22,229 | ||||||
Total Assets | 168,031,058 | 105,148,244 | ||||||
Liabilities | ||||||||
Securities sold short (B) | — | — | ||||||
Dividends and stock loan expense on securities sold short payable | — | — | ||||||
Bank overdrafts(B) | — | — | ||||||
Dividends payable | — | 771 | ||||||
Payable to Transfer Agent | 145,350 | 62,977 | ||||||
Payable for return of collateral for securities on loan | — | 1,601,443 | ||||||
Payable for capital shares redeemed | 419,717 | 204,640 | ||||||
Payable for investments purchased | 249 | 223,381 | ||||||
Payable to Investment Advisor | 80,732 | 69,928 | ||||||
Payable to other affiliates | 4,448 | 418 | ||||||
Payable to Trustees | 1,494 | 1,474 | ||||||
Payable for professional services | 9,478 | 8,780 | ||||||
Other accrued expenses and liabilities | 17,211 | 27,370 | ||||||
Total Liabilities | 678,679 | 2,201,182 | ||||||
Net Assets | $ | 167,352,379 | $ | 102,947,062 | ||||
Net assets consist of: | ||||||||
Paid-in capital | $ | 150,464,763 | $ | 119,852,556 | ||||
Accumulated net investment loss | (3,705 | ) | (418,502 | ) | ||||
Accumulated net realized gains (losses) on investments, warrants, foreign currency transactions, securities sold short and futures transactions | (32,283,480 | ) | (28,883,337 | ) | ||||
Net unrealized appreciation on investments, warrants, foreign currency transactions and securities sold short | 49,174,801 | 12,396,345 | ||||||
Net Assets | $ | 167,352,379 | $ | 102,947,062 | ||||
(A) Includes market value of securities on loan of: | $ | — | $ | 1,542,936 | ||||
(B) Proceeds received for securities sold short: | $ | — | $ | — |
See accompanying Notes to Financial Statements.
18 |
Statements of Assets and Liabilities (Continued)
Touchstone | Touchstone | |||||||||||||
Mid Cap | Small Cap | |||||||||||||
Value | Value | Touchstone | Touchstone | |||||||||||
Opportunities | Opportunities | U.S. Long/Short | Value | |||||||||||
Fund | Fund | Fund | Fund | |||||||||||
$ | 86,956,686 | $ | 94,444,689 | $ | 13,084,283 | $ | 273,858,086 | |||||||
$ | 2,364,744 | $ | 2,071,425 | $ | 7 | $ | 3,970,461 | |||||||
96,061,239 | 101,242,735 | 14,607,797 | 302,525,499 | |||||||||||
$ | 98,425,983 | $ | 103,314,160 | $ | 14,607,804 | $ | 306,495,960 | |||||||
— | 2,125 | — | — | |||||||||||
— | — | 4,574 | — | |||||||||||
220,932 | 85,794 | 15,525 | 519,892 | |||||||||||
2,290,353 | 7,976 | 4,822 | 251,506 | |||||||||||
1,981,057 | 327,333 | 123,780 | 42,540 | |||||||||||
9,002 | 20,920 | — | 57 | |||||||||||
— | — | 1,919 | — | |||||||||||
— | — | — | — | |||||||||||
24,071 | 16,689 | 14,817 | 25,910 | |||||||||||
102,951,398 | 103,774,997 | 14,773,241 | 307,335,865 | |||||||||||
— | — | 2,512,748 | — | |||||||||||
— | — | 711 | — | |||||||||||
— | — | 45,660 | — | |||||||||||
— | 18 | — | 22 | |||||||||||
36,030 | 10,524 | 8,942 | 44,093 | |||||||||||
6,249,304 | 8,660,912 | — | — | |||||||||||
2,378,242 | 264,011 | 9,230 | 295,139 | |||||||||||
603,728 | 210,625 | — | — | |||||||||||
52,571 | 70,216 | — | 117,227 | |||||||||||
652 | 5,250 | 614 | 18,128 | |||||||||||
1,486 | 1,476 | 1,458 | 1,479 | |||||||||||
9,029 | 9,729 | 9,409 | — | |||||||||||
8,331 | 11,324 | 10,034 | 5,676 | |||||||||||
9,339,373 | 9,244,085 | 2,598,806 | 481,764 | |||||||||||
$ | 93,612,025 | $ | 94,530,912 | $ | 12,174,435 | $ | 306,854,101 | |||||||
$ | 91,728,319 | $ | 82,050,816 | $ | 72,284,940 | $ | 279,866,676 | |||||||
(2,499 | ) | (46,055 | ) | (2,396 | ) | (16,945 | ) | |||||||
(9,583,092 | ) | 3,656,680 | (61,659,980 | ) | (5,633,504 | ) | ||||||||
11,469,297 | 8,869,471 | 1,551,871 | 32,637,874 | |||||||||||
$ | 93,612,025 | $ | 94,530,912 | $ | 12,174,435 | $ | 306,854,101 | |||||||
$ | 5,742,445 | $ | 8,566,841 | $ | — | $ | — | |||||||
$ | — | $ | — | $ | 2,541,098 | $ | — |
19 |
Statements of Assets and Liabilities (Continued)
Touchstone | Touchstone | |||||||
Capital | International | |||||||
Growth | Small Cap | |||||||
Fund | Fund | |||||||
Pricing of Class A Shares | ||||||||
Net assets applicable to Class A shares | $ | 1,044,714 | $ | 359,743 | ||||
Shares of beneficial interest outstanding | ||||||||
(unlimited number of shares authorized, no par value) | 51,286 | 30,888 | ||||||
Net asset value price per share* | $ | 20.37 | $ | 11.65 | ||||
Maximum offering price per share | $ | 21.61 | $ | 12.36 | ||||
Pricing of Class C Shares | ||||||||
Net assets applicable to Class C shares | $ | 11,885 | $ | 2,714 | ||||
Shares of beneficial interest outstanding | ||||||||
(unlimited number of shares authorized, no par value) | 587 | 233 | ||||||
Net asset value, offering price per share** | $ | 20.26 | $ | 11.65 | ||||
Pricing of Class Y Shares | ||||||||
Net assets applicable to Class Y shares | $ | 166,232,494 | $ | 87,239,883 | ||||
Shares of beneficial interest outstanding | ||||||||
(unlimited number of shares authorized, no par value) | 8,025,062 | 7,348,089 | ||||||
Net asset value, offering price and redemption price per share | $ | 20.71 | $ | 11.87 | ||||
Pricing of Institutional Class Shares | ||||||||
Net assets applicable to Institutional Class shares | $ | 63,286 | $ | 15,344,722 | ||||
Shares of beneficial interest outstanding | ||||||||
(unlimited number of shares authorized, no par value) | 3,038 | 1,287,242 | ||||||
Net asset value, offering price and redemption price per share | $ | 20.83 | $ | 11.92 |
* There is no sales load on subscriptions of $1 million or more. Redemptions that were part of a $1 million or more subscription may be subject to a contingent deferred sales load.
** Redemption price per share varies by length of time shares are held.
See accompanying Notes to Financial Statements.
20 |
Statements of Assets and Liabilities (Continued)
Touchstone | Touchstone | |||||||||||||
Mid Cap Value | Small Cap Value | Touchstone | Touchstone | |||||||||||
Opportunities | Opportunities | U.S. Long/Short | Value | |||||||||||
Fund | Fund | Fund | Fund | |||||||||||
$ | 1,348,013 | $ | 3,927,612 | $ | 1,288,898 | $ | 40,568,807 | |||||||
178,751 | 243,940 | 100,458 | 5,777,883 | |||||||||||
$ | 7.54 | $ | 16.10 | $ | 12.83 | $ | 7.02 | |||||||
$ | 8.00 | $ | 17.08 | $ | 13.61 | $ | 7.45 | |||||||
$ | 2,690 | $ | 2,647 | $ | 2,591 | $ | 2,564,285 | |||||||
358 | 164 | 202 | 365,255 | |||||||||||
$ | 7.52 | $ | 16.10 | $ | 12.82 | $ | 7.02 | |||||||
$ | 65,009,524 | $ | 85,152,241 | $ | 10,823,515 | $ | 95,998,996 | |||||||
8,587,307 | 5,105,726 | 834,827 | 13,633,485 | |||||||||||
$ | 7.57 | $ | 16.68 | $ | 12.96 | $ | 7.04 | |||||||
$ | 27,251,798 | $ | 5,448,412 | $ | 59,431 | $ | 167,722,013 | |||||||
3,603,676 | 324,023 | 4,597 | 23,865,773 | |||||||||||
$ | 7.56 | $ | 16.81 | $ | 12.93 | $ | 7.03 |
21 |
Statements of Operations
For the Six Months Ended December 31, 2012 (Unaudited)
Touchstone | Touchstone | |||||||
Capital | International | |||||||
Growth | Small Cap | |||||||
Fund | Fund | |||||||
Investment Income | ||||||||
Dividends from affiliated securities | $ | 1,441 | $ | 1,197 | ||||
Dividends from non-affiliated securities(A) | 954,414 | 1,081,836 | ||||||
Income from securities loaned | 840 | 18,670 | ||||||
Total Investment Income | 956,695 | 1,101,703 | ||||||
Expenses | ||||||||
Investment advisory fees | 597,533 | 458,376 | ||||||
Administration fees | 153,560 | 86,611 | ||||||
Compliance fees and expenses | 665 | 665 | ||||||
Custody fees | 4,752 | 28,560 | ||||||
Professional fees | 14,490 | 14,707 | ||||||
Transfer Agent fees, Class A | 498 | 329 | ||||||
Transfer Agent fees, Class C | 7 | 7 | ||||||
Transfer Agent fees, Class Y | 199,750 | 103,112 | ||||||
Transfer Agent fees, Institutional Class | 119 | 281 | ||||||
Registration Fees, Class A | 3,425 | 5,951 | ||||||
Registration Fees, Class C | 505 | 500 | ||||||
Registration Fees, Class Y | 6,279 | 7,118 | ||||||
Registration Fees, Institutional Class | 3,905 | 4,555 | ||||||
Dividend expense and stock loan expense on securities sold short | — | — | ||||||
Reports to Shareholders, Class A | 4,703 | 4,447 | ||||||
Reports to Shareholders, Class C | 2,409 | 2,386 | ||||||
Reports to Shareholders, Class Y | 5,077 | 431 | ||||||
Reports to Shareholders, Institutional Class | 3,171 | 3,203 | ||||||
Distribution expenses, Class A | 912 | 355 | ||||||
Distribution expenses, Class C | 17 | 13 | ||||||
Trustee fees | 3,250 | 3,232 | ||||||
Other expenses | 52,637 | 41,637 | ||||||
Total Expenses | 1,057,664 | 766,476 | ||||||
Fees waived and/or reimbursed by the Advisor and/or Affiliates (B) | (203,296 | ) | (152,248 | ) | ||||
Net Expenses | 854,368 | 614,228 | ||||||
Net Investment Income | 102,327 | 487,475 | ||||||
Realized and Unrealized Gain (Loss) on Investments | ||||||||
Net realized gain on investments | 11,358,796 | 399,851 | ||||||
Net realized gain on warrants | — | 6,346 | ||||||
Net realized loss on foreign currency | — | (38,219 | ) | |||||
Net realized loss on securities sold short | — | — | ||||||
Net change in unrealized appreciation (depreciation) on investments(C) | 841,976 | 12,638,853 | ||||||
Net change in unrealized appreciation (depreciation) on foreign currency transactions | — | 6,321 | ||||||
Net change in unrealized appreciation on securities sold short | — | — | ||||||
Net Realized and Unrealized Gain on Investments | 12,200,772 | 13,013,152 | ||||||
Change in Net Assets Resulting from Operations | $ | 12,303,099 | $ | 13,500,627 | ||||
(A)Net of foreign tax withholding of: | $ | — | $ | 26,578 |
(B)See note 4 in Notes to Financial Statements
(C)Change in unrealized appreciation/(depreciation) does not include net unrealized depreciation of $(20,792,699) for the Value Fund in connection with the Fund's merger. See Note 7 in the Notes to Financial Statements.
See accompanying Notes to Financial Statements.
22 |
Statements of Operations (Continued)
Touchstone | Touchstone | |||||||||||||
Mid Cap Value | Small Cap Value | Touchstone | Touchstone | |||||||||||
Opportunities | Opportunities | U.S. Long/Short | Value | |||||||||||
Fund | Fund | Fund | Fund | |||||||||||
$ | 2,719 | $ | 2,019 | $ | 38 | $ | 2,175 | |||||||
1,451,602 | 867,509 | 216,275 | 3,778,183 | |||||||||||
37,193 | 215,009 | — | 753 | |||||||||||
1,491,514 | 1,084,537 | 216,313 | 3,781,111 | |||||||||||
427,482 | 448,790 | 51,986 | 894,953 | |||||||||||
90,510 | 84,984 | 11,702 | 212,667 | |||||||||||
665 | 665 | 665 | 665 | |||||||||||
1,928 | 1,472 | 1,720 | 5,983 | |||||||||||
15,812 | 11,109 | 9,933 | 26,779 | |||||||||||
1,192 | 2,458 | 1,095 | 11,306 | |||||||||||
7 | 7 | 7 | 984 | |||||||||||
47,541 | 30,457 | 10,110 | 51,434 | |||||||||||
1,922 | 1,291 | 213 | 473 | |||||||||||
4,018 | 6,016 | 4,915 | 5,942 | |||||||||||
500 | 500 | 500 | 500 | |||||||||||
6,350 | 6,989 | 5,666 | 7,306 | |||||||||||
4,612 | 6,338 | �� | 2,890 | 4,826 | ||||||||||
— | — | 22,516 | — | |||||||||||
4,147 | 4,121 | 4,123 | 7,807 | |||||||||||
2,378 | 2,395 | 2,385 | 2,386 | |||||||||||
4,417 | 3,434 | 3,524 | 11,669 | |||||||||||
3,558 | 3,316 | 3,163 | 6,793 | |||||||||||
1,792 | 3,228 | 1,838 | 30,348 | |||||||||||
13 | 13 | 13 | 8,097 | |||||||||||
3,238 | 3,233 | 3,215 | 3,243 | |||||||||||
16,056 | 12,750 | 6,811 | 11,786 | |||||||||||
638,138 | 633,566 | 148,990 | 1,305,947 | |||||||||||
(138,415 | ) | (67,893 | ) | (56,436 | ) | (344,056 | ) | |||||||
499,723 | 565,673 | 92,554 | 961,891 | |||||||||||
991,791 | 518,864 | 123,759 | 2,819,220 | |||||||||||
5,377,699 | 11,854,008 | 831,630 | 20,870,276 | |||||||||||
— | — | — | — | |||||||||||
— | — | — | — | |||||||||||
— | — | 438,954 | — | |||||||||||
998,573 | (6,098,829 | ) | (65,391 | ) | (14,288,732 | ) | ||||||||
— | — | — | — | |||||||||||
— | — | (812,702 | ) | — | ||||||||||
6,376,272 | 5,755,179 | 392,491 | 6,581,544 | |||||||||||
$ | 7,368,063 | $ | 6,274,043 | $ | 516,250 | $ | 9,400,764 | |||||||
$ | — | $ | 229 | $ | — | $ | — |
23 |
Statements of Changes in Net Assets
Touchstone Capital | ||||||||||||
Growth Fund | ||||||||||||
For the | ||||||||||||
Six Months | ||||||||||||
Ended | For the | |||||||||||
December 31, | Three Months | For the | ||||||||||
2012 | Ended | Year Ended | ||||||||||
(Unaudited) | June 30, 2012 | March 31, 2012 | ||||||||||
From Operations | ||||||||||||
Net investment income (loss) | $ | 102,327 | $ | 112,772 | $ | 247,154 | ||||||
Net realized gain (loss) on investments, warrants and foreign currency transactions | 11,358,796 | 6,540,076 | 11,638,448 | |||||||||
Net change in unrealized appreciation (depreciation) on investments and foreign currency transactions | 841,976 | (20,410,114 | ) | 3,017,037 | ||||||||
Change in Net Assets from Operations | 12,303,099 | (13,757,266 | ) | 14,902,639 | ||||||||
Distributions to Shareholders from: | ||||||||||||
Net investment income, Class A | — | — | — | |||||||||
Net investment income, Class C | — | (A) | (1 | ) | — | |||||||
Net investment income, Class Y | (218,562 | ) | (31,764 | ) | — | |||||||
Net investment income, Class Z | — | — | (186,919 | ) | ||||||||
Net investment income, Institutional Class | (68 | ) | (84 | ) | (28,443 | ) | ||||||
Net realized gains, Class A | — | — | — | |||||||||
Net realized gains, Class C | — | — | — | |||||||||
Net realized gains, Class Y | — | — | — | |||||||||
Net realized gains, Class Z | — | — | — | |||||||||
Net realized gains, Institutional Class | — | — | — | |||||||||
Total Distributions | (218,630 | ) | (31,849 | ) | (215,362 | ) | ||||||
Net Increase (Decrease) from Share Transactions(B) | (10,034,413 | ) | (19,077,394 | ) | (25,723,783 | ) | ||||||
Total Increase (Decrease) in Net Assets | 2,050,056 | (32,866,509 | ) | (11,036,506 | ) | |||||||
Net Assets | ||||||||||||
Beginning of period | 165,302,323 | 198,168,832 | 209,205,338 | |||||||||
End of period | $ | 167,352,379 | $ | 165,302,323 | $ | 198,168,832 | ||||||
Accumulated Net Investment Income (Loss) | $ | (3,705 | ) | $ | 112,598 | $ | 31,675 |
(A)Amount rounds to less than $0.50
(B)For details on share transactions by class, see Statements of Changes in Net Assets - Capital Stock Activity on pages 28-33
See accompanying Notes to Financial Statements.
24 |
Statements of Changes in Net Assets (Continued)
Touchstone International | Touchstone Mid Cap | |||||||||||||||||||||
Small Cap Fund | Value Opportunities Fund | |||||||||||||||||||||
For the | For the | |||||||||||||||||||||
Six Months | Six Months | |||||||||||||||||||||
Ended | For the | Ended | For the | |||||||||||||||||||
December 31, | Three Months | For the | December 31, | Three Months | For the | |||||||||||||||||
2012 | Ended | Year Ended | 2012 | Ended | Year Ended | |||||||||||||||||
(Unaudited) | June 30, 2012 | March 31, 2012 | (Unaudited) | June 30, 2012 | March 31, 2012 | |||||||||||||||||
$ | 487,475 | $ | 795,817 | $ | 635,227 | $ | 991,791 | $ | 258,018 | $ | 1,780,201 | |||||||||||
367,978 | (2,705,536 | ) | 16,798,403 | 5,377,699 | 12,269,428 | 30,556,486 | ||||||||||||||||
12,645,174 | (4,812,758 | ) | (25,628,709 | ) | 998,573 | (15,845,639 | ) | (31,885,780 | ) | |||||||||||||
13,500,627 | (6,722,477 | ) | (8,195,079 | ) | 7,368,063 | (3,318,193 | ) | 450,907 | ||||||||||||||
(5,381 | ) | (1,870 | ) | (2,138 | ) | (14,855 | ) | (7,739 | ) | (5,292 | ) | |||||||||||
(22 | ) | (24 | ) | — | (17 | ) | (16 | ) | — | |||||||||||||
(1,270,129 | ) | (761,702 | ) | — | (845,879 | ) | (390,339 | ) | — | |||||||||||||
— | — | (1,710,699 | ) | — | — | (733,074 | ) | |||||||||||||||
(249,359 | ) | (38,728 | ) | (129,464 | ) | (390,985 | ) | (229,480 | ) | (1,432,706 | ) | |||||||||||
— | — | — | (252,628 | ) | (48,352 | ) | (85,531 | ) | ||||||||||||||
— | — | — | (435 | ) | (85 | ) | — | |||||||||||||||
— | — | — | (10,540,601 | ) | (2,162,086 | ) | — | |||||||||||||||
— | — | — | — | — | (4,048,591 | ) | ||||||||||||||||
— | — | — | (5,173,566 | ) | (1,208,407 | ) | (7,091,468 | ) | ||||||||||||||
(1,524,891 | ) | (802,324 | ) | (1,842,301 | ) | (17,218,966 | ) | (4,046,504 | ) | (13,396,662 | ) | |||||||||||
6,147,223 | (4,110,935 | ) | (13,562,188 | ) | 2,882,298 | (64,948,800 | ) | (100,560,408 | ) | |||||||||||||
18,122,959 | (11,635,736 | ) | (23,599,568 | ) | (6,968,605 | ) | (72,313,497 | ) | (113,506,163 | ) | ||||||||||||
84,824,103 | 96,459,839 | 120,059,407 | 100,580,630 | 172,894,127 | 286,400,290 | |||||||||||||||||
$ | 102,947,062 | $ | 84,824,103 | $ | 96,459,839 | $ | 93,612,025 | $ | 100,580,630 | $ | 172,894,127 | |||||||||||
$ | (418,502 | ) | $ | 618,914 | $ | 654,028 | $ | (2,499 | ) | $ | 257,446 | $ | 627,003 |
25 |
Statements of Changes in Net Assets (Continued)
Touchstone Small Cap | ||||||||||||
Value Opportunities Fund | ||||||||||||
For the | ||||||||||||
Six Months | ||||||||||||
Ended | For the | |||||||||||
December 31, | Three Months | For the | ||||||||||
2012 | Ended | Year Ended | ||||||||||
(Unaudited) | June 30, 2012 | March 31, 2012 | ||||||||||
From Operations | ||||||||||||
Net investment income (loss) | $ | 518,864 | $ | 29,097 | $ | (78,001 | ) | |||||
Net realized gain (loss) on investments, warrants, foreign currency transactions, securities sold short and futures transactions | 11,854,008 | 5,243,556 | 4,981,033 | |||||||||
Net change in unrealized appreciation (depreciation) on investments, warrants, foreign currency transactions, securities sold short and futures transactions | (6,098,829 | ) | (8,565,429 | ) | (4,671,365 | ) | ||||||
Change in Net Assets from Operations | 6,274,043 | (3,292,776 | ) | 231,667 | ||||||||
Distributions to Shareholders from: | ||||||||||||
Net investment income, Class A | (21,532 | ) | — | — | ||||||||
Net investment income, Class C | — | — | — | |||||||||
Net investment income, Class Y | (534,437 | ) | — | — | ||||||||
Net investment income, Class Z | — | — | — | |||||||||
Net investment income, Institutional Class | (38,047 | ) | — | — | ||||||||
Net realized gains, Class A | (411,110 | ) | (61,018 | ) | (128,052 | ) | ||||||
Net realized gains, Class C | (276 | ) | (75 | ) | — | |||||||
Net realized gains, Class Y | (8,672,644 | ) | (2,424,199 | ) | — | |||||||
Net realized gains, Class Z | — | — | (4,410,675 | ) | ||||||||
Net realized gains, Institutional Class | (738,391 | ) | (206,182 | ) | (957,098 | ) | ||||||
Total Distributions | (10,416,437 | ) | (2,691,474 | ) | (5,495,825 | ) | ||||||
Net Increase (Decrease) from Share Transactions(A) | 6,764,162 | (11,407,982 | ) | (6,890,909 | ) | |||||||
Total Increase (Decrease) in Net Assets | 2,621,768 | (17,392,232 | ) | (12,155,067 | ) | |||||||
Net Assets | ||||||||||||
Beginning of period | 91,909,144 | 109,301,376 | 121,456,443 | |||||||||
End of period | $ | 94,530,912 | $ | 91,909,144 | $ | 109,301,376 | ||||||
Accumulated Net Investment Income (Loss) | $ | (46,055 | ) | $ | 29,097 | $ | — |
(A)For details on share transactions by class, see Statements of Changes in Net Assets - Capital Stock Activity on pages 28-33 See accompanying Notes to Financial Statements.
26 |
Statements of Changes in Net Assets (Continued)
Touchstone U.S. | Touchstone | |||||||||||||||||||||
Long/Short Fund | Value Fund | |||||||||||||||||||||
For the | For the | |||||||||||||||||||||
Six Months | Six Months | |||||||||||||||||||||
Ended | For the | Ended | For the | |||||||||||||||||||
December 31, | Three Months | For the | December 31, | Three Months | For the | |||||||||||||||||
2012 | Ended | Year Ended | 2012 | Ended | Year Ended | |||||||||||||||||
(Unaudited) | June 30, 2012 | March 31, 2012 | (Unaudited) | June 30, 2012 | March 31, 2012 | |||||||||||||||||
$ | 123,759 | $ | 30,451 | $ | 149,386 | $ | 2,819,220 | $ | 566,642 | $ | 2,393,351 | |||||||||||
1,270,584 | 1,466,730 | 2,260,238 | 20,870,276 | 3,049,444 | 3,679,428 | |||||||||||||||||
(878,093 | ) | (2,193,967 | ) | (601,307 | ) | (14,288,732 | ) | (5,520,709 | ) | 5,418,074 | ||||||||||||
516,250 | (696,786 | ) | 1,808,317 | 9,400,764 | (1,904,623 | ) | 11,490,853 | |||||||||||||||
(13,828 | ) | — | (5,962 | ) | (271,723 | ) | (13,015 | ) | (35,067 | ) | ||||||||||||
(17 | ) | — | — | (10,418 | ) | (20 | ) | — | ||||||||||||||
(142,131 | ) | — | — | (929,087 | ) | (495,472 | ) | — | ||||||||||||||
— | — | (83,770 | ) | — | — | (1,506,155 | ) | |||||||||||||||
(835 | ) | — | (84,271 | ) | (1,649,898 | ) | (719,710 | ) | (746,586 | ) | ||||||||||||
— | — | — | (1,261,426 | ) | — | — | ||||||||||||||||
— | — | — | (80,161 | ) | — | — | ||||||||||||||||
— | — | — | (3,086,060 | ) | — | — | ||||||||||||||||
— | — | — | — | — | — | |||||||||||||||||
— | — | — | (5,131,975 | ) | — | — | ||||||||||||||||
(156,811 | ) | — | (174,003 | ) | (12,420,748 | ) | (1,228,217 | ) | (2,287,808 | ) | ||||||||||||
(1,662,302 | ) | (8,346,710 | ) | (27,364,223 | ) | 223,001,817 | 2,836,068 | (17,414,538 | ) | |||||||||||||
(1,302,863 | ) | (9,043,496 | ) | (25,729,909 | ) | 219,981,833 | (296,772 | ) | (8,211,493 | ) | ||||||||||||
13,477,298 | 22,520,794 | 48,250,703 | 122,581,850 | 122,878,622 | 131,090,115 | |||||||||||||||||
$ | 12,174,435 | $ | 13,477,298 | $ | 22,520,794 | $ | 342,563,683 | $ | 122,581,850 | $ | 122,878,622 | |||||||||||
$ | (2,396 | ) | $ | 30,656 | $ | — | $ | (16,945 | ) | $ | 24,961 | $ | 686,536 |
27 |
Statements of Changes in Net Assets - Capital Stock Activity
Touchstone Capital | ||||||||||||||||||||||||
Growth Fund | ||||||||||||||||||||||||
For the Six Months | ||||||||||||||||||||||||
Ended | For the Three Months | For the | ||||||||||||||||||||||
December 31, 2012 | Ended | Year Ended | ||||||||||||||||||||||
(Unaudited) | June 30, 2012 | March 31, 2012 | ||||||||||||||||||||||
Shares | Dollars | Shares | Dollars | Shares | Dollars | |||||||||||||||||||
Class A | ||||||||||||||||||||||||
Proceeds from Shares sold | 25,836 | $ | 523,060 | 1,530 | $ | 29,519 | 3,459 | $ | 66,930 | |||||||||||||||
Reinvestment of distributions | — | — | — | — | — | — | ||||||||||||||||||
Redemption fees | — | — | — | — | — | — | ||||||||||||||||||
Capital contribution | — | — | — | — | — | — | ||||||||||||||||||
Cost of Shares redeemed | (4,032 | ) | (81,814 | ) | (6,429 | ) | (120,348 | ) | (27,739 | ) | (501,671 | ) | ||||||||||||
Change in Net Assets from Class A Share Transactions | 21,804 | 441,246 | (4,899 | ) | (90,829 | ) | (24,280 | ) | (434,741 | ) | ||||||||||||||
Class C(A) | ||||||||||||||||||||||||
Proceeds from Shares sold | 462 | 9,250 | 125 | 2,500 | — | — | ||||||||||||||||||
Reinvestment of distributions | — | — | — | — | — | — | ||||||||||||||||||
Cost of Shares redeemed | — | — | — | — | — | — | ||||||||||||||||||
Change in Net Assets from Class C Share Transactions | 462 | 9,250 | 125 | 2,500 | — | — | ||||||||||||||||||
Class Y | ||||||||||||||||||||||||
Proceeds from Shares sold | 64,956 | 1,314,754 | 35,435 | 708,926 | — | — | ||||||||||||||||||
Proceeds from Shares issued in connection with merger(B) | — | — | 8,733,626 | 176,870,346 | — | — | ||||||||||||||||||
Reinvestment of distributions | 10,235 | 209,920 | 1,636 | 30,619 | — | — | ||||||||||||||||||
Cost of Shares redeemed | (584,106 | ) | (11,913,100 | ) | (236,720 | ) | (4,678,976 | ) | — | — | ||||||||||||||
Change in Net Assets from Class Y Share Transactions | (508,915 | ) | (10,388,426 | ) | 8,533,977 | 172,930,915 | — | — | ||||||||||||||||
Class Z | ||||||||||||||||||||||||
Proceeds from Shares sold | — | — | 10,516 | 217,602 | 250,864 | 4,663,886 | ||||||||||||||||||
Reinvestment of distributions | — | — | — | — | 10,082 | 180,476 | ||||||||||||||||||
Redemption fees | — | — | — | — | — | 60 | ||||||||||||||||||
Capital contribution | — | — | — | — | — | — | ||||||||||||||||||
Cost of Shares redeemed | — | — | (52,391 | ) | (1,084,808 | ) | (1,292,604 | ) | (24,178,763 | ) | ||||||||||||||
Cost of Shares redeemed in connection with merger(B) | — | — | (8,733,626 | ) | (176,870,346 | ) | — | — | ||||||||||||||||
Change in Net Assets from Class Z Share Transactions | — | — | (8,775,501 | ) | (177,737,552 | ) | (1,031,658 | ) | (19,334,341 | ) | ||||||||||||||
Institutional Class | ||||||||||||||||||||||||
Proceeds from Shares sold | 934 | 18,816 | 7,466 | 153,843 | 173,498 | 3,067,390 | ||||||||||||||||||
Reinvestment of distributions | 4 | 68 | 4 | 84 | 1,581 | 28,442 | ||||||||||||||||||
Capital contribution | — | — | — | — | — | — | ||||||||||||||||||
Cost of Shares redeemed | (5,731 | ) | (115,367 | ) | (698,268 | ) | (14,336,355 | ) | (480,349 | ) | (9,050,533 | ) | ||||||||||||
Change in Net Assets from Institutional Class Share Transactions | (4,793 | ) | (96,483 | ) | (690,798 | ) | (14,182,428 | ) | (305,270 | ) | (5,954,701 | ) | ||||||||||||
Net Increase (Decrease) from Share Transactions | (491,442 | ) | $ | (10,034,413 | ) | (937,096 | ) | $ | (19,077,394 | ) | (1,361,208 | ) | $ | (25,723,783 | ) |
(A)The Fund began issuing Class C shares on April 12, 2012.
(B)See Note 7 in the Notes to Financial Statements.
(C)During the year ended March 31, 2011, the Touchstone International Small Cap Fund received a one time distribution of settlement funds from Bank of America Fair Fund and Zurich Financial Services Ltd, respectively.
See accompanying Notes to Financial Statements.
28 |
Statements of Changes in Net Assets - Capital Stock Activity (Continued)
Touchstone International | ||||||||||||||||||||||
Small Cap Fund | ||||||||||||||||||||||
For the Six Months | ||||||||||||||||||||||
Ended | For the Three Months | For the | ||||||||||||||||||||
December 31, 2012 | Ended | Year Ended | ||||||||||||||||||||
(Unaudited) | June 30, 2012 | March 31, 2012 | ||||||||||||||||||||
Shares | Dollars | Shares | Dollars | Shares | Dollars | |||||||||||||||||
14,183 | $ | 158,989 | 6,837 | $ | 74,411 | 8,346 | $ | 94,756 | ||||||||||||||
357 | 4,132 | 171 | 1,686 | 189 | 1,850 | |||||||||||||||||
— | — | — | — | — | 49 | |||||||||||||||||
— | — | — | — | — | 2,779 | (C) | ||||||||||||||||
(3,143 | ) | (36,069 | ) | (381 | ) | (3,852 | ) | (13,135 | ) | (149,178 | ) | |||||||||||
11,397 | 127,052 | 6,627 | 72,245 | (4,600 | ) | (49,744 | ) | |||||||||||||||
275 | 3,147 | 229 | 2,500 | — | — | |||||||||||||||||
2 | 22 | 2 | 24 | — | — | |||||||||||||||||
(275 | ) | (3,147 | ) | — | — | — | — | |||||||||||||||
2 | 22 | 231 | 2,524 | — | — | |||||||||||||||||
34,396 | 391,108 | 34,312 | 375,239 | — | — | |||||||||||||||||
— | — | 7,920,316 | 108,468,743 | — | — | |||||||||||||||||
103,816 | 1,224,323 | 73,475 | 736,947 | — | — | |||||||||||||||||
(554,429 | ) | (6,278,647 | ) | (263,797 | ) | (2,859,596 | ) | — | — | |||||||||||||
(416,217 | ) | (4,663,216 | ) | 7,764,306 | 106,721,333 | — | — | |||||||||||||||
— | — | 4,918 | 55,160 | 297,008 | 3,274,383 | |||||||||||||||||
— | — | — | — | 166,235 | 1,659,021 | |||||||||||||||||
— | — | — | — | — | 143 | |||||||||||||||||
— | — | — | — | — | 1,690,684 | (C) | ||||||||||||||||
— | — | (36,040 | ) | (400,660 | ) | (2,288,637 | ) | (25,808,164 | ) | |||||||||||||
— | — | (7,920,316 | ) | (108,468,743 | ) | — | — | |||||||||||||||
— | — | (7,951,438 | ) | (108,814,243 | ) | (1,825,394 | ) | (19,183,933 | ) | |||||||||||||
1,080,044 | 12,567,647 | 17,760 | 199,592 | 469,209 | 5,699,848 | |||||||||||||||||
20,975 | 248,348 | 3,788 | 38,182 | 12,933 | 129,464 | |||||||||||||||||
— | — | — | — | — | 109,786 | (C) | ||||||||||||||||
(184,030 | ) | (2,132,630 | ) | (204,182 | ) | (2,330,568 | ) | (25,444 | ) | (267,609 | ) | |||||||||||
916,989 | 10,683,365 | (182,634 | ) | (2,092,794 | ) | 456,698 | 5,671,489 | |||||||||||||||
512,171 | $ | 6,147,223 | (362,908 | ) | $ | (4,110,935 | ) | (1,373,296 | ) | $ | (13,562,188 | ) |
29 |
Statements of Changes in Net Assets - Capital Stock Activity (Continued)
Touchstone Mid Cap | ||||||||||||||||||||||||
Value Opportunities Fund | ||||||||||||||||||||||||
For the Six Months | ||||||||||||||||||||||||
Ended | For the Three Months | For the | ||||||||||||||||||||||
December 31, 2012 | Ended | Year Ended | ||||||||||||||||||||||
(Unaudited) | June 30, 2012 | March 31, 2012 | ||||||||||||||||||||||
Shares | Dollars | Shares | Dollars | Shares | Dollars | |||||||||||||||||||
Class A | ||||||||||||||||||||||||
Proceeds from Shares sold | 21,422 | $ | 187,804 | 996 | $ | 8,613 | 34,843 | $ | 320,329 | |||||||||||||||
Reinvestment of distributions | 27,709 | 209,648 | 5,030 | 41,752 | 8,236 | 66,381 | ||||||||||||||||||
Redemption fees | — | — | — | — | — | 37 | ||||||||||||||||||
Cost of Shares redeemed | (37,255 | ) | (300,026 | ) | (7,099 | ) | (60,859 | ) | (324,638 | ) | (2,983,666 | ) | ||||||||||||
Change in Net Assets from Class A Share Transactions | 11,876 | 97,426 | (1,073 | ) | (10,494 | ) | (281,559 | ) | (2,596,919 | ) | ||||||||||||||
Class C(A) | ||||||||||||||||||||||||
Proceeds from Shares sold | — | — | 286 | 2,500 | — | — | ||||||||||||||||||
Reinvestment of distributions | 60 | 452 | 12 | 101 | — | — | ||||||||||||||||||
Change in Net Assets from Class C Share Transactions | 60 | 452 | 298 | 2,601 | — | — | ||||||||||||||||||
Class Y | ||||||||||||||||||||||||
Proceeds from Shares sold | 126,919 | 1,085,117 | 47,328 | 408,654 | — | — | ||||||||||||||||||
Proceeds from Shares issued in connection with merger(B) | — | — | 7,523,299 | 82,084,306 | — | — | ||||||||||||||||||
Reinvestment of distributions | 1,463,395 | 11,127,632 | 300,246 | 2,501,049 | — | — | ||||||||||||||||||
Cost of Shares redeemed | (579,244 | ) | (4,972,589 | ) | (294,636 | ) | (2,568,229 | ) | — | — | ||||||||||||||
Change in Net Assets from Class Y Share Transactions | 1,011,070 | 7,240,160 | 7,576,237 | 82,425,780 | — | — | ||||||||||||||||||
Class Z | ||||||||||||||||||||||||
Proceeds from Shares sold | — | — | 4,778 | 43,126 | 261,278 | 2,339,714 | ||||||||||||||||||
Reinvestment of distributions | — | — | — | — | 579,040 | 4,678,646 | ||||||||||||||||||
Redemption fees | — | — | — | — | — | 178 | ||||||||||||||||||
Cost of Shares redeemed | — | — | (45,504 | ) | (407,047 | ) | (1,359,346 | ) | (12,097,655 | ) | ||||||||||||||
Cost of Shares redeemed in connection with merger(B) | — | — | (7,523,299 | ) | (82,084,306 | ) | — | — | ||||||||||||||||
Change in Net Assets from Class Z Share Transactions | — | — | (7,564,025 | ) | (82,448,227 | ) | (519,028 | ) | (5,079,117 | ) | ||||||||||||||
Institutional Class | ||||||||||||||||||||||||
Proceeds from Shares sold | 478,607 | 3,797,817 | 65,074 | 567,568 | 1,685,177 | 15,296,264 | ||||||||||||||||||
Reinvestment of distributions | 141,150 | 1,073,105 | 26,841 | 223,314 | 233,931 | 1,887,820 | ||||||||||||||||||
Redemption fees | — | — | — | — | — | 805 | ||||||||||||||||||
Cost of Shares redeemed | (1,113,953 | ) | (9,326,662 | ) | (7,398,449 | ) | (65,709,342 | ) | (12,153,913 | ) | (110,069,261 | ) | ||||||||||||
Change in Net Assets from Institutional Class Share Transactions | (494,196 | ) | (4,455,740 | ) | (7,306,534 | ) | (64,918,460 | ) | (10,234,805 | ) | (92,884,372 | ) | ||||||||||||
Net Increase (Decrease) from Share Transactions | 528,810 | $ | 2,882,298 | (7,295,097 | ) | $ | (64,948,800 | ) | (11,035,392 | ) | $ | (100,560,408 | ) |
(A)The Fund began issuing Class C shares on April 12, 2012.
(B)See Note 7 in the Notes to Financial Statements.
See accompanying Notes to Financial Statements.
30 |
Statements of Changes in Net Assets - Capital Stock Activity (Continued)
Touchstone Small Cap | ||||||||||||||||||||||
Value Opportunities Fund | ||||||||||||||||||||||
For the Six Months | ||||||||||||||||||||||
Ended | For the Three Months | For the | ||||||||||||||||||||
December 31, 2012 | Ended | Year Ended | ||||||||||||||||||||
(Unaudited) | June 30, 2012 | March 31, 2012 | ||||||||||||||||||||
Shares | Dollars | Shares | Dollars | Shares | Dollars | |||||||||||||||||
121,786 | $ | 2,115,059 | 267 | $ | 4,630 | 8,333 | $ | 148,894 | ||||||||||||||
26,279 | 413,524 | 3,355 | 55,414 | 7,338 | 116,008 | |||||||||||||||||
— | — | — | — | — | 40 | |||||||||||||||||
(23,287 | ) | (394,142 | ) | (8,917 | ) | (153,524 | ) | (52,141 | ) | (903,971 | ) | |||||||||||
124,778 | 2,134,441 | (5,295 | ) | (93,480 | ) | (36,470 | ) | (639,029 | ) | |||||||||||||
— | — | 142 | 2,500 | — | — | |||||||||||||||||
17 | 276 | 5 | 75 | — | — | |||||||||||||||||
17 | 276 | 147 | 2,575 | — | — | |||||||||||||||||
161,777 | 2,868,884 | 99,840 | 1,789,027 | — | — | |||||||||||||||||
— | — | 4,703,562 | 71,625,574 | — | — | |||||||||||||||||
555,084 | 9,051,664 | 140,421 | 2,392,767 | — | — | |||||||||||||||||
(344,589 | ) | (6,038,502 | ) | (210,369 | ) | (3,739,581 | ) | — | — | |||||||||||||
372,272 | 5,882,046 | 4,733,454 | 72,067,787 | — | — | |||||||||||||||||
— | — | 28,256 | 520,312 | 877,947 | 15,758,310 | |||||||||||||||||
— | — | — | — | 263,593 | 4,286,016 | |||||||||||||||||
— | — | — | — | — | 5,729 | |||||||||||||||||
— | — | (50,553 | ) | (941,857 | ) | (1,442,108 | ) | (26,119,117 | ) | |||||||||||||
— | — | (4,703,562 | ) | (71,625,574 | ) | — | — | |||||||||||||||
— | — | (4,725,859 | ) | (72,047,119 | ) | (300,568 | ) | (6,069,062 | ) | |||||||||||||
21,291 | 383,405 | 63,682 | 1,120,571 | 55,531 | 1,007,117 | |||||||||||||||||
37,918 | 623,558 | 9,660 | 165,858 | 53,990 | 883,809 | |||||||||||||||||
— | — | — | — | — | 37 | |||||||||||||||||
(133,428 | ) | (2,259,564 | ) | (691,859 | ) | (12,624,174 | ) | (116,381 | ) | (2,073,781 | ) | |||||||||||
(74,219 | ) | (1,252,601 | ) | (618,517 | ) | (11,337,745 | ) | (6,860 | ) | (182,818 | ) | |||||||||||
422,848 | $ | 6,764,162 | (616,070 | ) | $ | (11,407,982 | ) | (343,898 | ) | $ | (6,890,909 | ) |
31 |
Statements of Changes in Net Assets - Capital Stock Activity (Continued)
Touchstone U.S. | ||||||||||||||||||||||||
Long/Short Fund | ||||||||||||||||||||||||
For the Six Months | ||||||||||||||||||||||||
Ended | For the Three Months | For the | ||||||||||||||||||||||
December 31, 2012 | Ended | Year Ended | ||||||||||||||||||||||
(Unaudited) | June 30, 2012 | March 31, 2012 | ||||||||||||||||||||||
Shares | Dollars | Shares | Dollars | Shares | Dollars | |||||||||||||||||||
Class A | ||||||||||||||||||||||||
Proceeds from Shares sold | 3,511 | $ | 45,386 | 4,175 | $ | 51,173 | 17,988 | $ | 201,924 | |||||||||||||||
Proceeds from Shares issued in connection with merger(B) | — | — | — | — | — | — | ||||||||||||||||||
Reinvestment of distributions | 812 | 10,363 | — | — | 342 | 3,777 | ||||||||||||||||||
Cost of Shares redeemed | (32,777 | ) | (422,673 | ) | (35,974 | ) | (432,202 | ) | (83,628 | ) | (979,054 | ) | ||||||||||||
Change in Net Assets from Class A Share Transactions | (28,454 | ) | (366,924 | ) | (31,799 | ) | (381,029 | ) | (65,298 | ) | (773,353 | ) | ||||||||||||
Class C(A) | ||||||||||||||||||||||||
Proceeds from Shares issued | — | — | 201 | 2,500 | — | — | ||||||||||||||||||
Proceeds from Shares issued in connection with merger(B) | — | — | — | — | — | — | ||||||||||||||||||
Reinvestment of distributions | 1 | 17 | — | — | — | — | ||||||||||||||||||
Cost of Shares redeemed | — | — | — | — | — | — | ||||||||||||||||||
Change in Net Assets from Class C Share Transactions | 1 | 17 | 201 | 2,500 | — | — | ||||||||||||||||||
Class Y | ||||||||||||||||||||||||
Proceeds from Shares sold | 7,233 | 92,645 | 5,137 | 64,376 | — | — | ||||||||||||||||||
Proceeds from Shares issued in connection with merger(B) | — | — | 977,090 | 56,262,298 | — | — | ||||||||||||||||||
Reinvestment of distributions | 10,252 | 132,247 | — | — | — | — | ||||||||||||||||||
Cost of Shares redeemed | (117,463 | ) | (1,520,989 | ) | (47,422 | ) | (595,087 | ) | — | — | ||||||||||||||
Change in Net Assets from Class Y Share Transactions | (99,978 | ) | (1,296,097 | ) | 934,805 | 55,731,587 | — | — | ||||||||||||||||
Class Z | ||||||||||||||||||||||||
Proceeds from Shares sold | — | — | 1,196 | 15,441 | 160,906 | 1,951,968 | ||||||||||||||||||
Reinvestment of distributions | — | — | — | — | 7,191 | 80,177 | ||||||||||||||||||
Redemption fees | — | — | — | — | — | — | ||||||||||||||||||
Cost of Shares redeemed | — | — | (8,811 | ) | (114,032 | ) | (2,159,360 | ) | (25,308,685 | ) | ||||||||||||||
Cost of Shares redeemed in connection with merger(B) | — | — | (977,090 | ) | (56,262,298 | ) | — | — | ||||||||||||||||
Change in Net Assets from Class Z Share Transactions | — | — | (984,705 | ) | (56,360,889 | ) | (1,991,263 | ) | (23,276,540 | ) | ||||||||||||||
Institutional Class | ||||||||||||||||||||||||
Proceeds from Shares sold | — | — | 8 | 601 | 135,280 | 1,563,565 | ||||||||||||||||||
Reinvestment of distributions | 65 | 835 | — | — | 7,404 | 82,262 | ||||||||||||||||||
Cost of Shares redeemed | (11 | ) | (133 | ) | (592,071 | ) | (7,339,480 | ) | (412,853 | ) | (4,960,157 | ) | ||||||||||||
Change in Net Assets from Institutional Class Share Transactions | 54 | 702 | (592,063 | ) | (7,338,879 | ) | (270,169 | ) | (3,314,330 | ) | ||||||||||||||
Net Increase (Decrease) from Share Transactions | (128,377 | ) | $ | (1,662,302 | ) | (673,561 | ) | $ | (8,346,710 | ) | (2,326,730 | ) | $ | (27,364,223 | ) |
(A)The Fund began issuing Class C shares on April 12, 2012.
(B)See Note 7 in the Notes to Financial Statements.
See accompanying Notes to Financial Statements.
32 |
Statements of Changes in Net Assets - Capital Stock Activity (Continued)
Touchstone | ||||||||||||||||||||||
Value Fund | ||||||||||||||||||||||
For the Six Months | ||||||||||||||||||||||
Ended | For the Three Months | For the | ||||||||||||||||||||
December 31, 2012 | Ended | Year Ended | ||||||||||||||||||||
(Unaudited) | June 30, 2012 | March 31, 2012 | ||||||||||||||||||||
Shares | Dollars | Shares | Dollars | Shares | Dollars | |||||||||||||||||
1,029,880 | $ | 7,233,230 | 17,290 | $ | 116,995 | 93,237 | $ | 618,049 | ||||||||||||||
4,934,586 | 35,709,582 | — | — | — | — | |||||||||||||||||
175,493 | 1,229,674 | 1,686 | 11,468 | 5,515 | 34,944 | |||||||||||||||||
(589,820 | ) | (4,256,959 | ) | (16,190 | ) | (109,738 | ) | (222,483 | ) | (1,508,451 | ) | |||||||||||
5,550,139 | 39,915,527 | 2,786 | 18,725 | (123,731 | ) | (855,458 | ) | |||||||||||||||
15,183 | 106,852 | 362 | 2,500 | — | — | |||||||||||||||||
380,586 | 2,753,770 | — | — | — | — | |||||||||||||||||
7,479 | 52,280 | 3 | 20 | — | — | |||||||||||||||||
(38,358 | ) | (277,340 | ) | — | — | — | — | |||||||||||||||
364,890 | 2,635,562 | 365 | 2,520 | — | — | |||||||||||||||||
785,308 | 5,622,405 | 72,824 | 503,826 | — | — | |||||||||||||||||
25,947,803 | 188,290,146 | 12,199,491 | 61,217,913 | — | — | |||||||||||||||||
512,094 | 3,600,980 | 71,221 | 485,728 | — | — | |||||||||||||||||
(20,994,278 | ) | (152,240,529 | ) | (4,960,978 | ) | (34,377,298 | ) | — | — | |||||||||||||
6,250,927 | 45,273,002 | 7,382,558 | 27,830,169 | — | — | |||||||||||||||||
— | — | 147,280 | 1,057,827 | �� | 3,259,081 | 20,953,779 | ||||||||||||||||
— | — | — | — | 191,652 | 1,217,319 | |||||||||||||||||
— | — | — | — | — | 82 | |||||||||||||||||
— | — | (170,728 | ) | (1,202,700 | ) | (4,181,411 | ) | (28,151,691 | ) | |||||||||||||
— | — | (12,199,491 | ) | (61,217,913 | ) | — | — | |||||||||||||||
— | — | (12,222,939 | ) | (61,362,786 | ) | (730,678 | ) | (5,980,511 | ) | |||||||||||||
21,482,062 | 155,723,748 | 6,249,356 | 43,073,243 | 565,867 | 3,618,510 | |||||||||||||||||
768,449 | 5,393,711 | 58,289 | 396,950 | 117,670 | 746,586 | |||||||||||||||||
(8,381,658 | ) | (61,649,315 | ) | (1,025,855 | ) | (7,122,753 | ) | (2,271,367 | ) | (14,943,665 | ) | |||||||||||
13,868,853 | 99,468,144 | 5,281,790 | 36,347,440 | (1,587,830 | ) | (10,578,569 | ) | |||||||||||||||
26,034,809 | $ | 187,292,235 | 444,560 | $ | 2,836,068 | (2,442,239 | ) | $ | (17,414,538 | ) |
33 |
Statement of Cash Flows
For the Year Ended December 31, 2012 (Unaudited)
Touchstone | ||||
U.S. Long/Short | ||||
Fund | ||||
Cash Flows Provided by (Used in) Operating Activities | ||||
Change in net assets resulting from operations | $ | 516,250 | ||
Adjustments to reconcile net increase (decrease) in net assets derived from operations to net cash provided by operating activities: | ||||
Purchases of investments | (16,414,225 | ) | ||
Proceeds from disposition of investments | 18,359,400 | |||
Proceeds from securities sold short | 4,441,957 | |||
Covers of securities sold short | (4,694,898 | ) | ||
Net sales of short term securities | 159,823 | |||
Increase in segregated cash | (4,574 | ) | ||
Increase in receivable for investments sold | (123,780 | ) | ||
Increase in dividends and interest receivable | (1,883 | ) | ||
Decrease in dividends for securities sold short payable | (614 | ) | ||
Decrease in receivable from Investment Advisor | 18,257 | |||
Decrease in other assets | 2,169 | |||
Decrease in payable to Trustees | (221 | ) | ||
Decrease in other accrued expenses and liabilities | (20,957 | ) | ||
Net realized gain from investments | (831,630 | ) | ||
Net realized gain from securities sold short | (438,954 | ) | ||
Net change in unrealized appreciation (depreciation) on investments | 65,391 | |||
Net change in unrealized appreciation (depreciation) on securities sold short | 812,702 | |||
Net cash provided by operating activities | 1,844,213 | |||
Cash Flows from Financing Activities | ||||
Increase in bank overdrafts | (36,696 | ) | ||
Proceeds from shares sold | 287,912 | |||
Payment of dividends | (156,811 | ) | ||
Payment of shares redeemed | (1,938,618 | ) | ||
Net cash used in financing activities | (1,844,213 | ) | ||
Net change in cash | — | |||
Cash - beginning of the period | — | |||
Cash - end of period | $ | — | ||
Supplemental disclosure of cash flow information: | ||||
Reinvestments of dividends and distributions | $ | 143,462 |
See accompanying Notes to Financial Statements.
34 |
Financial Highlights
Touchstone Capital Growth Fund—Class A
Selected Data for a Share Outstanding Throughout Each Period
Six Months | ||||||||||||||||||||||||||||
Ended | Three Months | |||||||||||||||||||||||||||
December 31, | Ended | |||||||||||||||||||||||||||
2012 | June 30, | Year Ended March 31, | ||||||||||||||||||||||||||
(Unaudited) | 2012 | 2012 | 2011 | 2010 | 2009 | 2008 | ||||||||||||||||||||||
Net asset value at beginning of period | $ | 18.96 | $ | 20.49 | $ | 18.95 | $ | 15.98 | $ | 11.01 | $ | 18.69 | $ | 18.11 | ||||||||||||||
Income (loss) from investment operations: | ||||||||||||||||||||||||||||
Net investment income (loss)(A) | (0.01 | ) | — | (B) | (0.03 | ) | (0.01 | ) | — | (0.01 | ) | (0.10 | ) | |||||||||||||||
Net realized and unrealized gains (losses) on investments | 1.42 | (1.53 | ) | 1.57 | 2.98 | 4.98 | (7.67 | ) | 0.68 | |||||||||||||||||||
Total from investment operations | 1.41 | (1.53 | ) | 1.54 | 2.97 | 4.98 | (7.68 | ) | 0.58 | |||||||||||||||||||
Distributions from: | ||||||||||||||||||||||||||||
Net investment income | — | — | — | — | (0.01 | ) | — | — | ||||||||||||||||||||
Net asset value at end of period | $ | 20.37 | $ | 18.96 | $ | 20.49 | $ | 18.95 | $ | 15.98 | $ | 11.01 | $ | 18.69 | ||||||||||||||
Total return(C) | 7.44 | %(D) | (7.47 | )%(D) | 8.13 | % | 18.59 | % | 45.22 | % | (41.09 | )% | 3.20 | % | ||||||||||||||
Ratios and supplemental data: | ||||||||||||||||||||||||||||
Net assets at end of period (000's) | $ | 1,045 | $ | 559 | $ | 705 | $ | 1,111 | $ | 1,066 | $ | 1,700 | $ | 2,002 | ||||||||||||||
Ratio to average net assets: | ||||||||||||||||||||||||||||
Net expenses | 1.25 | %(E) | 1.23 | %(E) | 1.14 | % | 1.23 | % | 1.36 | % | 1.50 | % | 1.50 | % | ||||||||||||||
Gross expenses | 3.58 | %(E) | 7.09 | %(E) | 2.93 | %(F) | 2.70 | %(F) | 0.36 | %(F) | 2.44 | %(F) | 3.31 | %(F) | ||||||||||||||
Net investment income (loss) | (0.13 | )%(E) | 0.01 | %(E) | (0.15 | )% | (0.07 | )% | 0.01 | % | (0.06 | )% | (0.51 | )% | ||||||||||||||
Portfolio turnover rate | 24 | %(D) | 6 | %(D) | 27 | % | 33 | % | 99 | % | 161 | % | 113 | % |
Touchstone Capital Growth Fund—Class C |
Selected Data for a Share Outstanding Throughout Each Period |
Six Months | ||||||||
Ended | Period | |||||||
December 31, | Ended | |||||||
2012 | June 30, | |||||||
(Unaudited) | 2012(G) | |||||||
Net asset value at beginning of period | $ | 18.93 | $ | 20.06 | ||||
Loss from investment operations: | ||||||||
Net investment loss(A) | (0.09 | ) | (0.03 | ) | ||||
Net realized and unrealized gains (losses) on investments | 1.42 | (1.09 | ) | |||||
Total from investment operations | 1.33 | (1.12 | ) | |||||
Distributions from: | ||||||||
Net investment income | — | (B) | (0.01 | ) | ||||
Net asset value at end of period | $ | 20.26 | $ | 18.93 | ||||
Total return(C) | 7.03 | %(D) | (5.59 | )%(D) | ||||
Ratios and supplemental data: | ||||||||
Net assets at end of period (000's) | $ | 12 | $ | 2 | ||||
Ratio to average net assets: | ||||||||
Net expenses | 2.00 | %(E) | 2.00 | %(E) | ||||
Gross expenses | 172.81 | %(E) | 962.52 | %(E) | ||||
Net investment loss | (0.88 | )%(E) | (0.76 | )%(E) | ||||
Portfolio turnover rate | 24 | %(D) | 6 | %(D) |
(A) | The net investment income per share is based on average shares outstanding for the period or year. |
(B) | Less than $0.005 per share. |
(C) | Total returns shown exclude the effect of applicable sales loads. If these charges were included, the returns would be lower. |
(D) | Not annualized. |
(E) | Annualized. |
(F) | Legal, printing and/or compliance audit expenses relating to civil litigation and certain regulatory actions in connection with market timing allegations were incurred, and the Former Adviser paid these expenses on behalf of the Funds. Had the Former Adviser not paid these expenses, the expenses for the Funds would have been higher than what is reflected in the financial highlights for the years ended March 31, 2012, 2011, 2010, 2009 and 2008. |
(G) | The Fund began issuing Class C shares on April 12, 2012. |
See accompanying Notes to Financial Statements.
35 |
Financial Highlights (Continued)
Touchstone Capital Growth Fund—Class Y
Selected Data for a Share Outstanding Throughout Each Period
Six Months | ||||||||||||||||||||||||||||
Ended | Three Months | |||||||||||||||||||||||||||
December 31, | Ended | |||||||||||||||||||||||||||
2012 | June 30, | Year Ended March 31, | ||||||||||||||||||||||||||
(Unaudited) | 2012 | 2012 | 2011 | 2010 | 2009 | 2008 | ||||||||||||||||||||||
Net asset value at beginning of period | $ | 19.29 | $ | 20.83 | $ | 19.24 | $ | 16.21 | $ | 11.18 | $ | 18.91 | $ | 18.28 | ||||||||||||||
Income (loss) from investment operations: | ||||||||||||||||||||||||||||
Net investment income (loss)(A) | 0.01 | 0.01 | 0.02 | 0.03 | 0.04 | 0.02 | (0.06 | ) | ||||||||||||||||||||
Net realized and unrealized gains (losses) on investments | 1.44 | (1.55 | ) | 1.59 | 3.04 | 5.05 | (7.75 | ) | 0.69 | |||||||||||||||||||
Total from investment operations | 1.45 | (1.54 | ) | 1.61 | 3.07 | 5.09 | (7.73 | ) | 0.63 | |||||||||||||||||||
Distributions from: | ||||||||||||||||||||||||||||
Net investment income | (0.03 | ) | — | (B) | (0.02 | ) | (0.04 | ) | (0.05 | ) | — | — | ||||||||||||||||
Return of capital | — | — | — | — | (0.01 | ) | — | — | ||||||||||||||||||||
Total distributions | (0.03 | ) | — | (0.02 | ) | (0.04 | ) | (0.06 | ) | — | — | |||||||||||||||||
Net asset value at end of period | $ | 20.71 | $ | 19.29 | $ | 20.83 | $ | 19.24 | $ | 16.21 | $ | 11.18 | $ | 18.91 | ||||||||||||||
Total return | 7.56 | %(C) | (7.42 | )%(C) | 8.39 | % | 18.93 | % | 45.52 | % | (40.88 | )% | 3.45 | % | ||||||||||||||
Ratios and supplemental data: | ||||||||||||||||||||||||||||
Net assets at end of period (000's) | $ | 166,232 | $ | 164,589 | $ | 182,828 | $ | 188,671 | $ | 178,941 | $ | 136,809 | $ | 94,245 | ||||||||||||||
Ratio to average net assets: | ||||||||||||||||||||||||||||
Net expenses | 1.00 | %(D) | 0.98 | %(D) | 0.89 | % | 0.98 | % | 1.08 | % | 1.25 | % | 1.25 | % | ||||||||||||||
Gross expenses | 1.22 | %(D) | 1.27 | %(D) | 1.30 | %(E) | 1.32 | %(E) | 1.44 | %(E) | 1.61 | %(E) | 1.68 | %(E) | ||||||||||||||
Net investment income (loss) | 0.12 | %(D) | 0.26 | %(D) | 0.13 | % | 0.18 | % | 0.27 | % | 0.14 | % | (0.31 | )% | ||||||||||||||
Portfolio turnover rate | 24 | %(C) | 6 | %(C) | 27 | % | 33 | % | 99 | % | 161 | % | 113 | % |
Touchstone Capital Growth Fund—Institutional Class |
Selected Data for a Share Outstanding Throughout Each Period |
Six Months | ||||||||||||||||||||||||||||
Ended | Three Months | |||||||||||||||||||||||||||
December 31, | Ended | |||||||||||||||||||||||||||
2012 | June 30, | Year Ended March 31, | ||||||||||||||||||||||||||
(Unaudited) | 2012 | 2012 | 2011 | 2010 | 2009 | 2008 | ||||||||||||||||||||||
Net asset value at beginning of period | $ | 19.38 | $ | 20.95 | $ | 19.35 | $ | 16.31 | $ | 11.25 | $ | 18.96 | $ | 18.29 | ||||||||||||||
Income (loss) from investment operations: | ||||||||||||||||||||||||||||
Net investment income (loss)(A) | 0.02 | 0.02 | 0.04 | 0.05 | 0.06 | 0.19 | (0.01 | ) | ||||||||||||||||||||
Net realized and unrealized gains (losses) on investments | 1.45 | (1.58 | ) | 1.60 | 3.04 | 5.07 | (7.90 | ) | 0.68 | |||||||||||||||||||
Total from investment operations | 1.47 | (1.56 | ) | 1.64 | 3.09 | 5.13 | (7.71 | ) | 0.67 | |||||||||||||||||||
Distributions from: | ||||||||||||||||||||||||||||
Net investment income | (0.02 | ) | (0.01 | ) | (0.04 | ) | (0.05 | ) | (0.05 | ) | — | — | ||||||||||||||||
Return of capital | — | — | — | — | (0.02 | ) | — | — | ||||||||||||||||||||
Total distributions | (0.02 | ) | (0.01 | ) | (0.04 | ) | (0.05 | ) | (0.07 | ) | — | — | ||||||||||||||||
Net asset value at end of period | $ | 20.83 | $ | 19.38 | $ | 20.95 | $ | 19.35 | $ | 16.31 | $ | 11.25 | $ | 18.96 | ||||||||||||||
Total return | 7.60 | %(C) | (7.44 | )%(C) | 8.51 | % | 18.99 | % | 45.69 | % | (40.66 | )% | 3.66 | % | ||||||||||||||
Ratios and supplemental data: | ||||||||||||||||||||||||||||
Net assets at end of period (000's) | $ | 63 | $ | 152 | $ | 14,636 | $ | 19,423 | $ | 26,977 | $ | 1,610 | $ | — | ||||||||||||||
Ratio to average net assets: | ||||||||||||||||||||||||||||
Net expenses | 0.90 | %(D) | 0.88 | %(D) | 0.79 | % | 0.88 | % | 0.90 | % | 0.95 | % | 0.95 | % | ||||||||||||||
Gross expenses | 18.58 | %(D) | 1.83 | %(D) | 0.90 | %(E) | 0.85 | %(E) | 0.79 | %(E) | 8.98 | %(E) | 3758.64 | %(E) | ||||||||||||||
Net investment income (loss) | 0.22 | %(D) | 0.36 | %(D) | 0.20 | % | 0.28 | % | 0.41 | % | 1.74 | % | (0.05 | )% | ||||||||||||||
Portfolio turnover rate | 24 | %(C) | 6 | %(C) | 27 | % | 33 | % | 99 | % | 161 | % | 113 | % |
(A) | The net investment income per share is based on average shares outstanding for the period or year. |
(B) | Less than $0.005 per share. |
(C) | Not annualized. |
(D) | Annualized. |
(E) | Legal, printing and/or compliance audit expenses relating to civil litigation and certain regulatory actions in connection with market timing allegations were incurred, and the Former Adviser paid these expenses on behalf of the Funds. Had the Former Adviser not paid these expenses, the expenses for the Funds would have been higher than what is reflected in the financial highlights for the years ended March 31, 2012, 2011, 2010, 2009 and 2008. |
See accompanying Notes to Financial Statements.
36 |
Financial Highlights (Continued)
Touchstone International Small Cap Fund—Class A
Selected Data for a Share Outstanding Throughout Each Period
Six Months | ||||||||||||||||||||||||||||
Ended | Three Months | |||||||||||||||||||||||||||
December 31, | Ended | |||||||||||||||||||||||||||
2012 | June 30, | Year Ended March 31, | ||||||||||||||||||||||||||
(Unaudited) | 2012 | 2012 | 2011 | 2010 | 2009 | 2008 | ||||||||||||||||||||||
Net asset value at beginning of period | $ | 10.21 | $ | 11.12 | $ | 11.88 | $ | 9.25 | $ | 6.25 | $ | 9.61 | $ | 13.31 | ||||||||||||||
Income (loss) from investment operations: | ||||||||||||||||||||||||||||
Net investment income (loss)(A) | 0.04 | 0.09 | 0.03 | (0.10 | ) | (0.08 | ) | (0.03 | ) | (0.06 | ) | |||||||||||||||||
Net realized and unrealized gains (losses) on investments | 1.57 | (0.90 | ) | (0.84 | ) | 2.73 | 3.09 | (B) | (3.33 | )(B) | (0.94 | ) | ||||||||||||||||
Total from investment operations | 1.61 | (0.81 | ) | (0.81 | ) | 2.63 | 3.01 | (3.36 | ) | (1.00 | ) | |||||||||||||||||
Distributions from: | ||||||||||||||||||||||||||||
Net investment income | (0.17 | ) | (0.10 | ) | (0.15 | ) | — | (0.01 | ) | — | — | |||||||||||||||||
Realized capital gains | — | — | — | — | — | — | (2.70 | ) | ||||||||||||||||||||
Total distributions | (0.17 | ) | (0.10 | ) | (0.15 | ) | — | (0.01 | ) | — | (2.70 | ) | ||||||||||||||||
Capital contribution | — | — | 0.20 | (C) | — | — | — | — | ||||||||||||||||||||
Net asset value at end of period | $ | 11.65 | $ | 10.21 | $ | 11.12 | $ | 11.88 | $ | 9.25 | $ | 6.25 | $ | 9.61 | ||||||||||||||
Total return(D) | 15.75 | %(E) | (7.28 | )%(E) | (4.96 | )%(C) | 28.43 | % | 48.12 | %(B) | (34.96 | )%(B) | (11.22 | )% | ||||||||||||||
Ratios and supplemental data: | ||||||||||||||||||||||||||||
Net assets at end of period (000's) | $ | 360 | $ | 199 | $ | 143 | $ | 207 | $ | 918 | $ | 720 | $ | 1,261 | ||||||||||||||
Ratio to average net assets: | ||||||||||||||||||||||||||||
Net expenses | 1.55 | %(F) | 1.55 | %(F) | 1.55 | % | 1.55 | % | 1.55 | % | 1.36 | % | 1.60 | % | ||||||||||||||
Gross expenses | 9.11 | %(F) | 19.37 | %(F) | 10.50 | %(G) | 3.23 | %(G) | 0.44 | %(G) | 4.20 | %(G) | 3.03 | %(G) | ||||||||||||||
Net investment income (loss) | 0.73 | %(F) | 3.36 | %(F) | 0.26 | % | (1.02 | )% | (0.97 | )% | (0.32 | )% | (0.49 | )% | ||||||||||||||
Portfolio turnover rate | 41 | %(E) | 21 | %(E) | 207 | % | 152 | % | 172 | % | 290 | % | 143 | % |
(A) | The net investment income per share is based on average shares outstanding for the period or year. |
(B) | Impact of payment from affiliate was less then $0.01 per share and 0.01%, respectively. |
(C) | Impact of one time distribution of settlement funds from the Bank of America Fair Fund. If the distribution had not occurred the total return would have been lower. |
(D) | Total returns shown exclude the effect of applicable sales loads. If these charges were included, the returns would be lower. |
(E) | Not annualized. |
(F) | Annualized. |
(G) | Legal, printing and/or compliance audit expenses relating to civil litigation and certain regulatory actions in connection with market timing allegations were incurred, and the Former Adviser paid these expenses on behalf of the Funds. Had the Former Adviser not paid these expenses, the expenses for the Funds would have been higher than what is reflected in the financial highlights for the years ended March 31, 2012, 2011, 2010, 2009 and 2008. |
See accompanying Notes to Financial Statements.
37 |
Financial Highlights (Continued)
Touchstone International Small Cap Fund—Class C |
Selected Data for a Share Outstanding Throughout Each Period |
Six Months | Three | |||||||
Ended | Months | |||||||
December 31, | Ended | |||||||
2012 | June 30, | |||||||
(Unaudited) | 2012(A) | |||||||
Net asset value at beginning of period | $ | 10.19 | $ | 10.94 | ||||
Income (loss) from investment operations: | ||||||||
Net investment income (loss)(B) | (— | )(C) | 0.05 | |||||
Net realized and unrealized gains (losses) on investments | 1.56 | (0.69 | ) | |||||
Total from investment operations | 1.56 | (0.64 | ) | |||||
Distributions from: | ||||||||
Net investment income (loss) | (0.10 | ) | (0.11 | ) | ||||
Net asset value at end of period | $ | 11.65 | $ | 10.19 | ||||
Total return(D) | 15.27 | %(E) | (5.84 | )%(E) | ||||
Ratios and supplemental data: | ||||||||
Net assets at end of period (000's) | $ | 3 | $ | 2 | ||||
Ratio to average net assets: | ||||||||
Net expenses | 2.30 | %(F) | 2.30 | %(F) | ||||
Gross expenses | 219.45 | %(F) | 968.58 | %(F) | ||||
Net investment income (loss) | (0.02 | )%(F) | 2.12 | %(F) | ||||
Portfolio turnover rate | 41 | %(E) | 21 | %(E) |
(A) | The Fund began issuing Class C shares on April 12, 2012. |
(B) | The net investment income per share is based on average shares outstanding for the period or year. |
(C) | Amount rounds to less than $0.005. |
(D) | Total returns shown exclude the effect of applicable sales loads. If these charges were included, the returns would be lower. |
(E) | Not annualized. |
(F) | Annualized. |
See accompanying Notes to Financial Statements.
38 |
Financial Highlights (Continued)
Touchstone International Small Cap Fund—Class Y
Selected Data for a Share Outstanding Throughout Each Period
Six Months | ||||||||||||||||||||||||||||
Ended | Three Months | |||||||||||||||||||||||||||
December 31, | Ended | |||||||||||||||||||||||||||
2012 | June 30, | Year Ended March 31, | ||||||||||||||||||||||||||
(Unaudited) | 2012 | 2012 | 2011 | 2010 | 2009 | 2008 | ||||||||||||||||||||||
Net asset value at beginning of period | $ | 10.40 | $ | 11.32 | $ | 12.14 | $ | 9.44 | $ | 6.37 | $ | 9.78 | $ | 13.47 | ||||||||||||||
Income (loss) from investment operations: | ||||||||||||||||||||||||||||
Net investment income (loss)(A) | 0.06 | 0.10 | 0.07 | (0.08 | ) | (0.05 | ) | — | (0.03 | ) | ||||||||||||||||||
Net realized and unrealized gains (losses) on investments | 1.58 | (0.92 | ) | (0.88 | ) | 2.80 | 3.14 | (B) | (3.41 | )(B) | (0.96 | ) | ||||||||||||||||
Total from investment operations | 1.64 | (0.82 | ) | (0.81 | ) | 2.72 | 3.09 | (3.41 | ) | (0.99 | ) | |||||||||||||||||
Distributions from: | ||||||||||||||||||||||||||||
Net investment income | (0.17 | ) | (0.10 | ) | (0.21 | ) | (0.02 | ) | (0.02 | ) | — | — | ||||||||||||||||
Realized capital gains | — | — | — | — | — | — | (2.70 | ) | ||||||||||||||||||||
Total distributions | (0.17 | ) | (0.10 | ) | (0.21 | ) | (0.02 | ) | (0.02 | ) | — | (2.70 | ) | |||||||||||||||
Capital contribution | — | — | 0.20 | (C) | — | — | — | — | ||||||||||||||||||||
Net asset value at end of period | $ | 11.87 | $ | 10.40 | $ | 11.32 | $ | 12.14 | $ | 9.44 | $ | 6.37 | $ | 9.78 | ||||||||||||||
Total return | 15.82 | %(D) | (7.22 | )%(D) | (4.81 | )%(C) | 28.82 | % | 48.56 | %(B) | (34.87 | )%(B) | (11.00 | )% | ||||||||||||||
Ratios and supplemental data: | ||||||||||||||||||||||||||||
Net assets at end of period (000's) | $ | 87,240 | $ | 80,754 | $ | 90,029 | $ | 118,679 | $ | 107,478 | $ | 79,518 | $ | 24,156 | ||||||||||||||
Ratio to average net assets: | ||||||||||||||||||||||||||||
Net expenses | 1.30 | %(E) | 1.30 | %(E) | 1.30 | % | 1.30 | % | 1.30 | % | 1.10 | % | 1.35 | % | ||||||||||||||
Gross expenses | 1.57 | %(E) | 1.74 | %(E) | 1.69 | %(F) | 1.59 | %(F) | 1.74 | %(F) | 1.75 | %(F) | 1.74 | %(F) | ||||||||||||||
Net investment income (loss) | 0.98 | %(E) | 3.61 | %(E) | 0.60 | % | (0.80 | )% | (0.65 | )% | (0.01 | )% | (0.19 | )% | ||||||||||||||
Portfolio turnover rate | 41 | %(D) | 21 | %(D) | 207 | % | 152 | % | 172 | % | 290 | % | 143 | % |
(A) | The net investment income per share is based on average shares outstanding for the period or year. |
(B) | Impact of payment from affiliate was less then $0.01 per share and 0.01%, respectively. |
(C) | Impact of one time distribution of settlement funds from the Bank of America Fair Fund. If the distribution had not occurred the total return would have been lower. |
(D) | Not annualized. |
(E) | Annualized. |
(F) | Legal, printing and/or compliance audit expenses relating to civil litigation and certain regulatory actions in connection with market timing allegations were incurred, and the Former Adviser paid these expenses on behalf of the Funds. Had the Former Adviser not paid these expenses, the expenses for the Funds would have been higher than what is reflected in the financial highlights for the years ended March 31, 2012, 2011, 2010, 2009 and 2008. |
See accompanying Notes to Financial Statements.
39 |
Financial Highlights (Continued)
Touchstone International Small Cap Fund—Institutional Class
Selected Data for a Share Outstanding Throughout Each Period
Six Months | ||||||||||||||||||||||||||||
Ended | Three Months | |||||||||||||||||||||||||||
December 31, | Ended | |||||||||||||||||||||||||||
2012 | June 30, | Year Ended March 31, | ||||||||||||||||||||||||||
(Unaudited) | 2012 | 2012 | 2011 | 2010 | 2009 | 2008 | ||||||||||||||||||||||
Net asset value at beginning of period | $ | 10.45 | $ | 11.37 | $ | 12.20 | $ | 9.49 | $ | 6.39 | $ | 9.80 | $ | 13.48 | ||||||||||||||
Income (loss) from investment operations: | ||||||||||||||||||||||||||||
Net investment income (loss)(A) | 0.07 | 0.10 | 0.13 | (0.06 | ) | (0.03 | ) | (0.02 | ) | — | ||||||||||||||||||
Net realized and unrealized gains (losses) on investments | 1.60 | (0.91 | ) | (0.93 | ) | 2.81 | 3.16 | (B) | (3.39 | )(B) | (0.98 | ) | ||||||||||||||||
Total from investment operations | 1.67 | (0.81 | ) | (0.80 | ) | 2.75 | 3.13 | (3.41 | ) | (0.98 | ) | |||||||||||||||||
Distributions from: | ||||||||||||||||||||||||||||
Net investment income | (0.20 | ) | (0.11 | ) | (0.24 | ) | (0.04 | ) | (0.03 | ) | — | — | ||||||||||||||||
Realized capital gains | — | — | — | — | — | — | (2.70 | ) | ||||||||||||||||||||
Total distributions | (0.20 | ) | (0.11 | ) | (0.24 | ) | (0.04 | ) | (0.03 | ) | — | (2.70 | ) | |||||||||||||||
Capital contribution | — | — | 0.21 | (C) | — | — | — | — | ||||||||||||||||||||
Net asset value at end of period | $ | 11.92 | $ | 10.45 | $ | 11.37 | $ | 12.20 | $ | 9.49 | $ | 6.39 | $ | 9.80 | ||||||||||||||
Total return | 15.95 | %(D) | (7.13 | )%(D) | (4.55 | )%(C) | 29.00 | % | 49.05 | %(B) | (34.80 | )%(B) | (10.92 | )% | ||||||||||||||
Ratios and supplemental data: | ||||||||||||||||||||||||||||
Net assets at end of period (000's) | $ | 15,345 | $ | 3,869 | $ | 6,288 | $ | 1,173 | $ | 3,168 | $ | 11,923 | $ | — | ||||||||||||||
Ratio to average net assets: | ||||||||||||||||||||||||||||
Net expenses | 1.05 | %(E) | 1.05 | %(E) | 1.05 | % | 1.05 | % | 1.05 | % | 1.06 | % | 1.10 | % | ||||||||||||||
Gross expenses | 1.46 | %(E) | 2.05 | %(E) | 1.46 | %(F) | 2.22 | %(F) | 1.14 | %(F) | 18.23 | %(F) | 3,635.24 | %(F) | ||||||||||||||
Net investment income (loss) | 1.23 | %(E) | 3.86 | %(E) | 1.15 | % | (0.61 | )% | (0.35 | )% | (0.32 | )% | (0.02 | )% | ||||||||||||||
Portfolio turnover rate | 41 | %(D) | 21 | %(D) | 207 | % | 152 | % | 172 | % | 290 | % | 143 | % |
(A) | The net investment income per share is based on average shares outstanding for the period or year. |
(B) | Impact of payment from affiliate was less then $0.01 per share and 0.01%, respectively. |
(C) | Impact of one time distribution of settlement funds from the Bank of America Fair Fund. If the distribution had not occurred the total return would have been lower. |
(D) | Not annualized. |
(E) | Annualized. |
(F) | Legal, printing and/or compliance audit expenses relating to civil litigation and certain regulatory actions in connection with market timing allegations were incurred, and the Former Adviser paid these expenses on behalf of the Funds. Had the Former Adviser not paid these expenses, the expenses for the Funds would have been higher than what is reflected in the financial highlights for the years ended March 31, 2012, 2011, 2010, 2009 and 2008. |
See accompanying Notes to Financial Statements.
40 |
Financial Highlights (Continued)
Touchstone Mid Cap Value Opportunities Fund—Class A
Selected Data for a Share Outstanding Throughout Each Period
Six Months | ||||||||||||||||||||||||||||
Ended | Three Months | |||||||||||||||||||||||||||
December 31, | Ended | |||||||||||||||||||||||||||
2012 | June 30, | Year Ended March 31, | ||||||||||||||||||||||||||
(Unaudited) | 2012 | 2012 | 2011 | 2010 | 2009 | 2008 | ||||||||||||||||||||||
Net asset value at beginning of period | $ | 8.46 | $ | 9.01 | $ | 9.42 | $ | 7.86 | $ | 5.61 | $ | 8.69 | $ | 10.00 | ||||||||||||||
Income (loss) from investment operations: | ||||||||||||||||||||||||||||
Net investment income(A) | 0.07 | 0.01 | 0.03 | 0.04 | 0.03 | 0.02 | 0.01 | |||||||||||||||||||||
Net realized and unrealized gains (losses) on investments | 0.55 | (0.21 | )(B) | 0.14 | 1.54 | 2.24 | (3.07 | ) | (1.32 | ) | ||||||||||||||||||
Total from investment operations | 0.62 | (0.20 | ) | 0.17 | 1.58 | 2.27 | (3.05 | ) | (1.31 | ) | ||||||||||||||||||
Distributions from: | ||||||||||||||||||||||||||||
Net investment income | (0.08 | ) | (0.05 | ) | (0.03 | ) | (0.02 | ) | (0.02 | ) | (0.03 | ) | — | |||||||||||||||
Realized capital gains | (1.46 | ) | (0.30 | ) | (0.55 | ) | — | — | — | — | ||||||||||||||||||
Total distributions | (1.54 | ) | (0.35 | ) | (0.58 | ) | (0.02 | ) | (0.02 | ) | (0.03 | ) | — | |||||||||||||||
Net asset value at end of period | $ | 7.54 | $ | 8.46 | $ | 9.01 | $ | 9.42 | $ | 7.86 | $ | 5.61 | $ | 8.69 | ||||||||||||||
Total return(C) | 7.54 | %(D) | (2.21 | )%(D) | 2.54 | % | 20.14 | % | 40.41 | % | (35.07 | )% | (13.10 | )% | ||||||||||||||
Ratios and supplemental data: | ||||||||||||||||||||||||||||
Net assets at end of period (000's) | $ | 1,348 | $ | 1,412 | $ | 1,512 | $ | 4,234 | $ | 5,408 | $ | 5,304 | $ | 2,340 | ||||||||||||||
Ratio to average net assets: | 1.29 | %(E) | 1.31 | %(E) | 1.40 | % | 1.40 | % | 1.40 | % | 1.40 | % | 1.40 | % | ||||||||||||||
Net expenses | ||||||||||||||||||||||||||||
Gross expenses | 2.66 | %(E) | 3.93 | %(E) | 2.34 | %(F) | 2.10 | %(F) | 1.94 | %(F) | 2.53 | %(F) | 3.69 | %(F) | ||||||||||||||
Net investment income | 1.68 | %(E) | 0.55 | %(E) | 0.32 | % | 0.53 | % | 0.36 | % | 0.29 | % | 0.17 | % | ||||||||||||||
Portfolio turnover rate | 46 | %(D) | 20 | %(D) | 101 | % | 89 | % | 125 | % | 163 | % | 67 | % |
Touchstone Mid Cap Value Opportunities Fund—Class C
Selected Data for a Share Outstanding Throughout Each Period
Six Months | ||||||||
Ended | Period | |||||||
December 31, | Ended | |||||||
2012 | June 30, | |||||||
(Unaudited) | 2012(G) | |||||||
Net asset value at beginning of period | $ | 8.44 | $ | 8.76 | ||||
Income (loss) from investment operations: | ||||||||
Net investment income (loss)(A) | 0.04 | (— | )(H) | |||||
Net realized and unrealized gains on investments | 0.55 | 0.04 | (B) | |||||
Total from investment operations | 0.59 | 0.04 | ||||||
Distributions from: | ||||||||
Net investment income | (0.05 | ) | (0.06 | ) | ||||
Realized capital gains | (1.46 | ) | (0.30 | ) | ||||
Total distributions | (1.51 | ) | (0.36 | ) | ||||
Net asset value at end of period | $ | 7.52 | $ | 8.44 | ||||
Total return(C) | 7.15 | %(D) | 0.46 | %(D) | ||||
Ratios and supplemental data: | ||||||||
Net assets at end of period (000's) | $ | 3 | $ | 3 | ||||
Ratio to average net assets: | ||||||||
Net expenses | 2.04 | %(E) | 2.04 | %(E) | ||||
Gross expenses | 221.81 | %(E) | 931.83 | %(E) | ||||
Net investment income (loss) | 0.93 | %(E) | (0.21 | )%(E) | ||||
Portfolio turnover rate | 46 | %(D) | 20 | %(D) |
(A) | The net investment income per share is based on average shares outstanding for the period or year. |
(B) | For the period ended June 30, 2012, the Fund received a corporate action payment that resulted in a one-time increase to realized gains. If the corporate action event had not occurred, the net realized and unrealized gains (losses) per share would have been lower by approximately $0.05 per share. |
(C) | Total returns shown exclude the effect of applicable sales loads. If these charges were included, the returns would be lower. |
(D) | Not annualized. |
(E) | Annualized. |
(F) | Legal, printing and/or compliance audit expenses relating to civil litigation and certain regulatory actions in connection with market timing allegations were incurred, and the Former Adviser paid these expenses on behalf of the Funds. Had the Former Adviser not paid these expenses, the expenses for the Funds would have been higher than what is reflected in the financial highlights for the years ended March 31, 2012, 2011, 2010, 2009 and 2008. |
(G) | The Fund began issuing Class C shares on April 12, 2012. |
(H) | Less than $0.005 per share. |
41 |
Financial Highlights (Continued)
Touchstone Mid Cap Value Opportunities Fund—Class Y
Selected Data for a Share Outstanding Throughout Each Period
Six Months | ||||||||||||||||||||||||
Ended | Three Months | |||||||||||||||||||||||
December 31, | Ended | |||||||||||||||||||||||
2012 | June 30, | Year Ended March 31, | ||||||||||||||||||||||
(Unaudited) | 2012 | 2012 | 2011 | 2010 | 2009(A) | |||||||||||||||||||
Net asset value at beginning of period | $ | 8.50 | $ | 9.04 | $ | 9.50 | $ | 7.92 | $ | 5.65 | $ | 6.02 | ||||||||||||
Income (loss) from investment operations: | ||||||||||||||||||||||||
Net investment income(B) | 0.08 | 0.02 | 0.07 | 0.07 | 0.05 | 0.07 | ||||||||||||||||||
Net realized and unrealized gains (losses) on investments | 0.55 | (0.21 | )(C) | 0.12 | 1.56 | 2.26 | (0.41 | ) | ||||||||||||||||
Total from investment operations | 0.63 | (0.19 | ) | 0.19 | 1.63 | 2.31 | (0.34 | ) | ||||||||||||||||
Distributions from: | ||||||||||||||||||||||||
Net investment income | (0.10 | ) | (0.05 | ) | (0.10 | ) | (0.05 | ) | (0.04 | ) | (0.03 | ) | ||||||||||||
Realized capital gains | (1.46 | ) | (0.30 | ) | (0.55 | ) | — | — | — | |||||||||||||||
Total distributions | (1.56 | ) | (0.35 | ) | (0.65 | ) | (0.05 | ) | (0.04 | ) | (0.03 | ) | ||||||||||||
Net asset value at end of period | $ | 7.57 | $ | 8.50 | $ | 9.04 | $ | 9.50 | $ | 7.92 | $ | 5.65 | ||||||||||||
Total return | 7.59 | %(D) | (2.02 | )%(D) | 2.77 | % | 20.59 | % | 40.90 | % | (5.60 | )% | ||||||||||||
Ratios and supplemental data: | ||||||||||||||||||||||||
Net assets at end of period (000's) | $ | 65,009 | $ | 64,371 | $ | 68,366 | $ | 76,756 | $ | 76,965 | $ | 60,618 | ||||||||||||
Ratio to average net assets: | ||||||||||||||||||||||||
Net expenses | 1.04 | %(E) | 1.05 | %(E) | 1.12 | % | 1.12 | % | 1.12 | % | 1.12 | % | ||||||||||||
Gross expenses | 1.28 | %(E) | 1.38 | %(E) | 1.36 | %(F) | 1.37 | %(F) | 1.38 | %(F) | 3.20 | %(F) | ||||||||||||
Net investment income | 1.93 | %(E) | 0.81 | %(E) | 0.83 | % | 0.80 | % | 0.64 | % | 1.29 | % | ||||||||||||
Portfolio turnover rate | 46 | %(D) | 20 | %(D) | 101 | % | 89 | % | 125 | % | 163 | % |
Touchstone Mid Cap Value Opportunities Fund—Institutional Class
Selected Data for a Share Outstanding Throughout Each Period
Six Months | ||||||||||||||||||||||||||||
Ended | Three Months | |||||||||||||||||||||||||||
December 31, | Ended | |||||||||||||||||||||||||||
2012 | June 30, | Year Ended March 31, | ||||||||||||||||||||||||||
(Unaudited) | 2012 | 2012 | 2011 | 2010 | 2009 | 2008 | ||||||||||||||||||||||
Net asset value at beginning of period | $ | 8.49 | $ | 9.03 | $ | 9.49 | $ | 7.92 | $ | 5.65 | $ | 8.72 | $ | 10.00 | ||||||||||||||
Income (loss) from investment operations: | ||||||||||||||||||||||||||||
Net investment income(B) | 0.09 | 0.02 | 0.08 | 0.08 | 0.06 | 0.05 | 0.04 | |||||||||||||||||||||
Net realized and unrealized gains (losses) on investments | 0.55 | (0.20 | )(C) | 0.12 | 1.55 | 2.25 | (3.08 | ) | (1.31 | ) | ||||||||||||||||||
Total from investment operations | 0.64 | (0.18 | ) | 0.20 | 1.63 | 2.31 | (3.03 | ) | (1.27 | ) | ||||||||||||||||||
Distributions from: | ||||||||||||||||||||||||||||
Net investment income | (0.11 | ) | (0.06 | ) | (0.11 | ) | (0.06 | ) | (0.04 | ) | (0.04 | ) | (0.01 | ) | ||||||||||||||
Realized capital gains | (1.46 | ) | (0.30 | ) | (0.55 | ) | — | — | — | — | ||||||||||||||||||
Total distributions | (1.57 | ) | (0.36 | ) | (0.66 | ) | (0.06 | ) | (0.04 | ) | (0.04 | ) | (0.01 | ) | ||||||||||||||
Net asset value at end of period | $ | 7.56 | $ | 8.49 | $ | 9.03 | $ | 9.49 | $ | 7.92 | $ | 5.65 | $ | 8.72 | ||||||||||||||
Total return | 7.69 | %(D) | (1.99 | )%(D) | 2.91 | % | 20.61 | % | 41.01 | % | (34.81 | )% | (12.75 | )% | ||||||||||||||
Ratios and supplemental data: | ||||||||||||||||||||||||||||
Net assets at end of period (000's) | $ | 27,252 | $ | 34,795 | $ | 103,016 | $ | 205,410 | $ | 171,807 | $ | 57,430 | $ | 56,426 | ||||||||||||||
Ratio to average net assets: | ||||||||||||||||||||||||||||
Net expenses | 0.89 | %(E) | 0.91 | %(E) | 1.00 | % | 1.00 | % | 1.00 | % | 1.00 | % | 1.00 | % | ||||||||||||||
Gross expenses | 1.17 | %(E) | 1.22 | %(E) | 1.08 | %(F) | 1.06 | %(F) | 1.06 | %(F) | 1.18 | %(F) | 1.10 | %(F) | ||||||||||||||
Net investment income | 2.07 | %(E) | 0.96 | %(E) | 0.85 | % | 0.91 | % | 0.82 | % | 0.58 | % | 0.57 | % | ||||||||||||||
Portfolio turnover rate | 46 | %(D) | 20 | %(D) | 101 | % | 89 | % | 125 | % | 163 | % | 67 | % |
(A) | Class commenced operations on December 9, 2008. |
(B) | The net investment income per share is based on average shares outstanding for the period or year. |
(C) | For the period ended June 30, 2012, the Fund received a corporate action payment that resulted in a one-time increase to realized gains. If the corporate action event had not occurred, the net realized and unrealized gains (losses) per share would have been lower by approximately $0.05 per share. |
(D) | Not annualized. |
(E) | Annualized. |
(F) | Legal, printing and/or compliance audit expenses relating to civil litigation and certain regulatory actions in connection with market timing allegations were incurred, and the Former Adviser paid these expenses on behalf of the Funds. Had the Former Adviser not paid these expenses, the expenses for the Funds would have been higher than what is reflected in the financial highlights for the years ended March 31, 2012, 2011, 2010, 2009 and 2008. |
See accompanying Notes to Financial Statements.
42 |
Financial Highlights (Continued)
Touchstone Small Cap Value Opportunities Fund—Class A
Selected Data for a Share Outstanding Throughout Each Period
Six Months | ||||||||||||||||||||||||||||
Ended | Three Months | |||||||||||||||||||||||||||
December 31, | Ended | |||||||||||||||||||||||||||
2012 | June 30, | Year Ended March 31, | ||||||||||||||||||||||||||
(Unaudited) | 2012 | 2012 | 2011 | 2010 | 2009 | 2008 | ||||||||||||||||||||||
Net asset value at beginning of period | $ | 16.97 | $ | 18.08 | $ | 19.06 | $ | 16.43 | $ | 11.05 | $ | 19.43 | $ | 25.99 | ||||||||||||||
Income (loss) from investment operations: | ||||||||||||||||||||||||||||
Net investment income (loss) | 0.05 | (0.01 | ) | (0.06 | )(A) | (0.08 | )(A) | (0.01 | )(A) | (— | )(A)(B) | (0.16 | )(A) | |||||||||||||||
Net realized and unrealized gains (losses) on investments | 1.05 | (0.57 | ) | 0.04 | 2.71 | 5.39 | (6.66 | )(C) | (2.51 | ) | ||||||||||||||||||
Total from investment operations | 1.10 | (0.58 | ) | (0.02 | ) | 2.63 | 5.38 | (6.66 | ) | (2.67 | ) | |||||||||||||||||
Distributions from: | ||||||||||||||||||||||||||||
Net investment income | (0.09 | ) | — | — | — | — | (0.02 | ) | — | |||||||||||||||||||
Realized capital gains | (1.88 | ) | (0.53 | ) | (0.96 | ) | — | — | (1.70 | ) | (3.89 | ) | ||||||||||||||||
Total distributions | (1.97 | ) | (0.53 | ) | (0.96 | ) | — | — | (1.72 | ) | (3.89 | ) | ||||||||||||||||
Net asset value at end of period | $ | 16.10 | $ | 16.97 | $ | 18.08 | $ | 19.06 | $ | 16.43 | $ | 11.05 | $ | 19.43 | ||||||||||||||
Total return(D) | 6.74 | %(E) | (3.09 | )%(E) | 0.60 | % | 16.01 | % | 48.71 | % | (34.71 | )%(C) | (11.75 | )% | ||||||||||||||
Ratios and supplemental data: | ||||||||||||||||||||||||||||
Net assets at end of period (000's) | $ | 3,928 | $ | 2,023 | $ | 2,251 | $ | 3,068 | $ | 4,815 | $ | 2,160 | $ | 1,137 | ||||||||||||||
Ratio to average net assets: | ||||||||||||||||||||||||||||
Net expenses | 1.50 | %(F) | 1.50 | %(F) | 1.50 | % | 1.50 | % | 1.50 | % | 1.53 | % | 1.55 | % | ||||||||||||||
Gross expenses | 2.42 | %(F) | 3.31 | %(F) | 2.27 | %(G) | 2.10 | %(G) | 1.47 | %(G) | 3.25 | %(G) | 4.57 | %(G) | ||||||||||||||
Net investment income (loss) | 0.80 | %(F) | (0.16 | )%(F) | (0.34 | )% | (0.46 | )% | (0.08 | )% | (0.01 | )% | (0.71 | )% | ||||||||||||||
Portfolio turnover rate | 58 | %(E) | 18 | %(E) | 49 | % | 55 | % | 83 | % | 140 | % | 40 | % |
Touchstone Small Cap Value Opportunities Fund—Class C
Selected Data for a Share Outstanding Throughout Each Period
Six Months | ||||||||
Ended | Period | |||||||
December 31, | Ended | |||||||
2012 | June 30, | |||||||
(Unaudited) | 2012(H) | |||||||
Net asset value at beginning of period | $ | 16.95 | $ | 17.58 | ||||
Loss from investment operations: | ||||||||
Net investment income (loss) | 0.01 | (0.03 | ) | |||||
Net realized and unrealized gains (losses) on investments | 1.02 | (0.07 | ) | |||||
Total from investment operations | 1.03 | (0.10 | ) | |||||
Distributions from: | ||||||||
Realized capital gains | (1.88 | ) | (0.53 | ) | ||||
Net asset value at end of period | $ | 16.10 | $ | 16.95 | ||||
Total return(D) | 6.39 | %(E) | (0.51 | )%(E) | ||||
Ratios and supplemental data: | ||||||||
Net assets at end of period (000's) | $ | 3 | $ | 2 | ||||
Ratio to average net assets: | ||||||||
Net expenses | 2.25 | %(F) | 2.25 | %(F) | ||||
Gross expenses | 228.38 | %(F) | 942.58 | %(F) | ||||
Net investment income (loss) | 0.05 | %(F) | (0.95 | )%(F) | ||||
Portfolio turnover rate | 58 | %(E) | 18 | %(E) |
(A) | The net investment income per share is based on average shares outstanding for the period or year. |
(B) | Less than $0.005 per share. |
(C) | Impact of payment from affiliate was less then $0.01 per share and 0.01%, respectively. |
(D) | Total returns shown exclude the effect of applicable sales loads. If these charges were included, the returns would be lower. |
(E) | Not annualized. |
(F) | Annualized. |
(G) | Legal, printing and/or compliance audit expenses relating to civil litigation and certain regulatory actions in connection with market timing allegations were incurred, and the Former Adviser paid these expenses on behalf of the Funds. Had the Former Adviser not paid these expenses, the expenses for the Funds would have been higher than what is reflected in the financial highlights for the years ended March 31, 2012, 2011, 2010, 2009 and 2008. |
(H) | The Fund began issuing Class C shares on April 12, 2012. |
See accompanying Notes to Financial Statements.
43 |
Financial Highlights (Continued)
Touchstone Small Cap Value Opportunities Fund— Class Y
Selected Data for a Share Outstanding Throughout Each Period
Six Months | ||||||||||||||||||||||||||||
Ended | Three Months | |||||||||||||||||||||||||||
December 31, | Ended | |||||||||||||||||||||||||||
2012 | June 30, | Year Ended March 31, | ||||||||||||||||||||||||||
(Unaudited) | 2012 | 2012 | 2011 | 2010 | 2009 | 2008 | ||||||||||||||||||||||
Net asset value at beginning of period | $ | 17.51 | $ | 18.62 | $ | 19.55 | $ | 16.80 | $ | 11.29 | $ | 19.76 | $ | 26.30 | ||||||||||||||
Income (loss) from investment operations: | ||||||||||||||||||||||||||||
Net investment income (loss) | 0.09 | 0.01 | (0.02 | )(A) | (0.04 | )(A) | 0.03 | (A) | 0.02 | (A) | (0.13 | )(A) | ||||||||||||||||
Net realized and unrealized gains (losses) on investments | 1.06 | (0.59 | ) | 0.05 | 2.79 | 5.51 | (6.77 | )(B) | (2.52 | ) | ||||||||||||||||||
Total from investment operations | 1.15 | (0.58 | ) | 0.03 | 2.75 | 5.54 | (6.75 | ) | (2.65 | ) | ||||||||||||||||||
Distributions from: | ||||||||||||||||||||||||||||
Net investment income | (0.10 | ) | — | — | — | (0.03 | ) | (0.02 | ) | — | ||||||||||||||||||
Realized capital gains | (1.88 | ) | (0.53 | ) | (0.96 | ) | — | — | (1.70 | ) | (3.89 | ) | ||||||||||||||||
Total distributions | (1.98 | ) | (0.53 | ) | (0.96 | ) | — | (0.03 | ) | (1.72 | ) | (3.89 | ) | |||||||||||||||
Net asset value at end of period | $ | 16.68 | $ | 17.51 | $ | 18.62 | $ | 19.55 | $ | 16.80 | $ | 11.29 | $ | 19.76 | ||||||||||||||
Total return | 6.92 | %(C) | (3.05 | )%(C) | 0.85 | % | 16.37 | % | 49.10 | % | (34.57 | )%(B) | (11.53 | )% | ||||||||||||||
Ratios and supplemental data: | ||||||||||||||||||||||||||||
Net assets at end of period (000's) | $ | 85,152 | $ | 82,861 | $ | 87,984 | $ | 98,269 | $ | 86,737 | $ | 55,976 | $ | 45,862 | ||||||||||||||
Ratio to average net assets: | ||||||||||||||||||||||||||||
Net expenses | 1.20 | %(D) | 1.22 | %(D) | 1.25 | % | 1.25 | % | 1.25 | % | 1.23 | % | 1.30 | % | ||||||||||||||
Gross expenses | 1.29 | %(D) | 1.40 | %(D) | 1.27 | %(E) | 1.26 | %(E) | 1.30 | %(E) | 1.37 | %(E) | 1.49 | %(E) | ||||||||||||||
Net investment income (loss) | 1.10 | %(D) | 0.12 | %(D) | (0.09 | )% | (0.23 | )% | 0.18 | % | 0.15 | % | (0.51 | )% | ||||||||||||||
Portfolio turnover rate | 58 | %(C) | 18 | %(C) | 49 | % | 55 | % | 83 | % | 140 | % | 40 | % |
Touchstone Small Cap Value Opportunities Fund—Institutional Class |
Selected Data for a Share Outstanding Throughout Each Period |
Six Months | ||||||||||||||||||||||||
Ended | Three Months | |||||||||||||||||||||||
December 31, | Ended | |||||||||||||||||||||||
2012 | June 30, | Year Ended March 31, | ||||||||||||||||||||||
(Unaudited) | 2012 | 2012 | 2011 | 2010 | 2009(F) | |||||||||||||||||||
Net asset value at beginning of period | $ | 17.63 | $ | 18.75 | $ | 19.65 | $ | 16.87 | $ | 11.32 | $ | 14.28 | ||||||||||||
Income (loss) from investment operations: | ||||||||||||||||||||||||
Net investment income (loss) | 0.13 | 0.01 | 0.01 | (A) | (0.01 | )(A) | 0.05 | (A) | 0.02 | (A) | ||||||||||||||
Net realized and unrealized gains (losses) on investments | 1.05 | (0.60 | ) | 0.05 | 2.79 | 5.54 | (1.26 | )(B) | ||||||||||||||||
Total from investment operations | 1.18 | (0.59 | ) | 0.06 | 2.78 | 5.59 | (1.24 | ) | ||||||||||||||||
Distributions from: | ||||||||||||||||||||||||
Net investment income | (0.12 | ) | — | — | — | (0.04 | ) | (0.02 | ) | |||||||||||||||
Realized capital gains | (1.88 | ) | (0.53 | ) | (0.96 | ) | — | — | (1.70 | ) | ||||||||||||||
Total distributions | (2.00 | ) | (0.53 | ) | (0.96 | ) | — | (0.04 | ) | (1.72 | ) | |||||||||||||
Net asset value at end of period | $ | 16.81 | $ | 17.63 | $ | 18.75 | $ | 19.65 | $ | 16.87 | $ | 11.32 | ||||||||||||
Total return | 6.94 | %(C) | (3.04 | )%(C) | 1.00 | % | 16.48 | % | 49.46 | % | (9.52 | )%(B) | ||||||||||||
Ratios and supplemental data: | ||||||||||||||||||||||||
Net assets at end of period (000's) | $ | 5,448 | $ | 7,023 | $ | 19,066 | $ | 20,119 | $ | 26,915 | $ | — | ||||||||||||
Ratio to average net assets: | ||||||||||||||||||||||||
Net expenses | 1.10 | %(D) | 1.10 | %(D) | 1.10 | % | 1.10 | % | 1.10 | % | 1.09 | % | ||||||||||||
Gross expenses | 1.50 | %(D) | 1.60 | %(D) | 1.18 | %(E) | 1.18 | %(E) | 1.16 | %(E) | 24873.11 | %(E) | ||||||||||||
Net investment income (loss) | 1.20 | %(D) | 0.24 | %(D) | 0.06 | % | (0.08 | )% | 0.34 | % | 0.15 | % | ||||||||||||
Portfolio turnover rate | 58 | %(C) | 18 | %(C) | 49 | % | 55 | % | 83 | % | 140 | % |
(A) | The net investment income per share is based on average shares outstanding for the period or year. |
(B) | Impact of payment from affiliate was less then $0.01 per share and 0.01%, respectively. |
(C) | Not annualized. |
(D) | Annualized. |
(E) | Legal, printing and/or compliance audit expenses relating to civil litigation and certain regulatory actions in connection with market timing allegations were incurred, and the Former Adviser paid these expenses on behalf of the Funds. Had the Former Adviser not paid these expenses, the expenses for the Funds would have been higher than what is reflected in the financial highlights for the years ended March 31, 2012, 2011, 2010, 2009 and 2008. |
(F) | Class commenced operations on December 9, 2008. |
See accompanying Notes to Financial Statements.
44 |
Financial Highlights (Continued)
Touchstone U.S. Long/Short Fund—Class A
Selected Data for a Share Outstanding Throughout Each Period
Six Months | ||||||||||||||||||||||||||||
Ended | Three Months | |||||||||||||||||||||||||||
December 31, | Ended | |||||||||||||||||||||||||||
2012 | June 30, | Year Ended March 31, | ||||||||||||||||||||||||||
(Unaudited) | 2012 | 2012 | 2011 | 2010 | 2009 | 2008 | ||||||||||||||||||||||
Net asset value at beginning of period | $ | 12.49 | $ | 12.81 | $ | 11.74 | $ | 10.67 | $ | 7.77 | $ | 13.02 | $ | 14.15 | ||||||||||||||
Income (loss) from investment operations: | ||||||||||||||||||||||||||||
Net investment income (loss)(A) | 0.11 | 0.02 | 0.02 | 0.09 | 0.07 | 0.01 | (0.03 | ) | ||||||||||||||||||||
Net realized and unrealized gains (losses) on investments | 0.37 | (0.34 | ) | 1.08 | 1.30 | 2.89 | (5.23 | ) | (1.05 | ) | ||||||||||||||||||
Total from investment operations | 0.48 | (0.32 | ) | 1.10 | 1.39 | 2.96 | (5.22 | ) | (1.08 | ) | ||||||||||||||||||
Distributions from: | ||||||||||||||||||||||||||||
Net investment income | (0.14 | ) | — | (0.03 | ) | (0.32 | ) | (0.06 | ) | (0.03 | ) | (0.05 | ) | |||||||||||||||
Net asset value at end of period | $ | 12.83 | $ | 12.49 | $ | 12.81 | $ | 11.74 | $ | 10.67 | $ | 7.77 | $ | 13.02 | ||||||||||||||
Total return(B) | 3.84 | %(C) | (2.50 | )%(C) | 9.44 | % | 13.29 | % | 38.09 | % | (40.12 | )% | (7.66 | )% | ||||||||||||||
Ratios and supplemental data: | ||||||||||||||||||||||||||||
Net assets at end of period (000's) | $ | 1,289 | $ | 1,610 | $ | 2,059 | $ | 2,654 | $ | 4,616 | $ | 5,222 | $ | 14,468 | ||||||||||||||
Ratio to average net assets: | ||||||||||||||||||||||||||||
Net expenses (including dividend expense on securities sold short)(D) | 1.65 | %(E) | 1.67 | %(E) | 1.71 | % | 1.47 | % | 1.53 | % | 2.03 | % | 1.87 | % | ||||||||||||||
Gross expenses (including dividend expense on securities sold short)(F) | 3.30 | %(E) | 4.54 | %(E) | 2.59 | %(G) | 2.20 | %(G) | 1.97 | %(G) | 2.59 | %(G) | 2.75 | %(G) | ||||||||||||||
Net investment income (loss) | 1.68 | %(E) | 0.54 | %(E) | 0.17 | % | 0.91 | % | 0.76 | % | 0.07 | % | (0.19 | )% | ||||||||||||||
Portfolio turnover rate | 107 | %(C) | 69 | %(C) | 231 | % | 218 | % | 200 | % | 184 | % | 236 | % |
(A) | The net investment income per share is based on average shares outstanding for the period or year. |
(B) | Total returns shown exclude the effect of applicable sales loads. If these charges were included, the returns would be lower. |
(C) | Not annualized. |
(D) | The ratio of net expenses to average net assets excluding dividend expense on securities sold short is 1.30%, 1.31%, 1.53%, 1.45%, 1.45%, 1.49% and 1.60% for the periods ended December 31, 2012, June 30, 2012 and years ended March 2012, 2011, 2010, 2009 and 2008, respectively. |
(E) | Annualized. |
(F) | The ratio of gross expenses to average net assets excluding dividend expense on securities sold short is 2.95%, 4.18%, 2.41%, 2.18%, 1.89%, 2.05% and 2.48% for the periods ended December 31, 2012, June 30, 2012 and years ended March 2012, 2011, 2010, 2009 and 2008, respectively. |
(G) | Legal, printing and/or compliance audit expenses relating to civil litigation and certain regulatory actions in connection with market timing allegations were incurred, and the Former Adviser paid these expenses on behalf of the Funds. Had the Former Adviser not paid these expenses, the expenses for the Funds would have been higher than what is reflected in the financial highlights for the years ended March 31, 2012, 2011, 2010, 2009 and 2008. |
See accompanying Notes to Financial Statements.
45 |
Financial Highlights (Continued)
Touchstone U.S. Long/Short Fund—Class C
Selected Data for a Share Outstanding Throughout Each Period
Six Months | ||||||||
Ended | Period | |||||||
December 31, | Ended | |||||||
2012 | June 30, | |||||||
(Unaudited) | 2012(A) | |||||||
Net asset value at beginning of period | $ | 12.47 | $ | 12.45 | ||||
Income (loss) from investment operations: | ||||||||
Net investment income (loss)(B) | 0.06 | (0.01 | ) | |||||
Net realized and unrealized gains on investments | 0.37 | 0.03 | ||||||
Total from investment operations | 0.43 | 0.02 | ||||||
Distributions from: | ||||||||
Net investment income | (0.08 | ) | — | |||||
Net asset value at end of period | $ | 12.82 | $ | 12.47 | ||||
Total return(C) | 3.48 | %(D) | 0.16 | %(D) | ||||
Ratios and supplemental data: | ||||||||
Net assets at end of period (000's) | $ | 3 | $ | 3 | ||||
Ratio to average net assets: | ||||||||
Net expenses (including dividend expense on securities sold short)(E) | 2.40 | %(F) | 2.41 | %(F) | ||||
Gross expenses (including dividend expense on securities sold short)(G) | 226.68 | %(F) | 944.77 | %(F) | ||||
Net investment income (loss) | 0.93 | %(F) | (0.21 | )%(F) | ||||
Portfolio turnover rate | 107 | %(D) | 69 | %(D) |
(A) | The Fund began issuing Class C shares on April 12, 2012. |
(B) | The net investment income per share is based on average shares outstanding for the period or year. |
(C) | Total returns shown exclude the effect of applicable sales loads. If these charges were included, the returns would be lower. |
(D) | Not annualized. |
(E) | The ratio of net expenses to average net assets excluding dividend expense on securities sold short is 2.05% and 2.05% for the periods ended December 31, 2012 and June 30, 2012, respectively. |
(F) | Annualized. |
(G) | The ratio of gross expenses to average net assets excluding dividend expense on securities sold short is 226.33% and 944.41% for the periods ended December 31, 2012 and June 30, 2012, respectively. |
See accompanying Notes to Financial Statements.
46 |
Financial Highlights (Continued)
Touchstone U.S. Long/Short Fund—Class Y
Selected Data for a Share Outstanding Throughout Each Period
Six Months | ||||||||||||||||||||||||||||
Ended | Three Months | |||||||||||||||||||||||||||
December 31, | Ended | |||||||||||||||||||||||||||
2012 | June 30, | Year Ended March 31, | ||||||||||||||||||||||||||
(Unaudited) | 2012 | 2012 | 2011 | 2010 | 2009 | 2008 | ||||||||||||||||||||||
Net asset value at beginning of period | $ | 12.63 | $ | 12.95 | $ | 11.87 | $ | 10.76 | $ | 7.85 | $ | 13.11 | $ | 14.20 | ||||||||||||||
Income (loss) from investment operations: | ||||||||||||||||||||||||||||
Net investment income(A) | 0.13 | 0.02 | 0.05 | 0.12 | 0.10 | 0.06 | 0.03 | |||||||||||||||||||||
Net realized and unrealized gains (losses) on investments | 0.37 | (0.34 | ) | 1.09 | 1.32 | 2.90 | (5.29 | ) | (1.09 | ) | ||||||||||||||||||
Total from investment operations | 0.50 | (0.32 | ) | 1.14 | 1.44 | 3.00 | (5.23 | ) | (1.06 | ) | ||||||||||||||||||
Distributions from: | ||||||||||||||||||||||||||||
Net investment income | (0.17 | ) | — | (0.06 | ) | (0.33 | ) | (0.09 | ) | (0.03 | ) | (0.03 | ) | |||||||||||||||
Net asset value at end of period | $ | 12.96 | $ | 12.63 | $ | 12.95 | $ | 11.87 | $ | 10.76 | $ | 7.85 | $ | 13.11 | ||||||||||||||
Total return | 4.06 | %(B) | (2.47 | )%(B) | 9.64 | % | 13.66 | % | 38.30 | % | (39.91 | )% | (7.47 | )% | ||||||||||||||
Ratios and supplemental data: | ||||||||||||||||||||||||||||
Net assets at end of period (000's) | $ | 10,824 | $ | 11,808 | $ | 12,755 | $ | 35,321 | $ | 125,337 | $ | 149,755 | $ | 46,374 | ||||||||||||||
Ratio to average net assets: | ||||||||||||||||||||||||||||
Net expenses (including dividend expense on securities sold short)(C) | 1.40 | %(D) | 1.41 | %(D) | 1.45 | % | 1.22 | % | 1.28 | % | 1.83 | % | 1.45 | % | ||||||||||||||
Gross expenses (including dividend expense on securities sold short)(E) | 2.01 | %(D) | 2.63 | %(D) | 1.59 | %(F) | 1.24 | %(F) | 1.23 | %(F) | 1.69 | %(F) | 1.83 | %(F) | ||||||||||||||
Net investment income | 1.93 | %(D) | 0.79 | %(D) | 0.41 | % | 1.14 | % | 1.01 | % | 0.57 | % | 0.18 | % | ||||||||||||||
Portfolio turnover rate | 107 | %(B) | 69 | %(B) | 231 | % | 218 | % | 200 | % | 184 | % | 236 | % |
(A) | The net investment income per share is based on average shares outstanding for the period or year. |
(B) | Not annualized. |
(C) | The ratio of net expenses to average net assets excluding dividend expense on securities sold short is 1.05%, 1.06%, 1.27%, 1.20%, 1.20%, 1.25% and 1.19% for the periods ended December 31, 2012, June 30, 2012 and years ended March 2012, 2011, 2010, 2009 and 2008, respectively. |
(D) | Annualized. |
(E) | The ratio of gross expenses to average net assets excluding dividend expense on securities sold short is 1.66%, 2.28%, 1.41%, 1.22%, 1.15%, 1.11% and 1.57% for the periods ended December 31, 2012, June 30, 2012 and years ended March 2012, 2011, 2010, 2009 and 2008, respectively. |
(F) | Legal, printing and/or compliance audit expenses relating to civil litigation and certain regulatory actions in connection with market timing allegations were incurred, and the Former Adviser paid these expenses on behalf of the Funds. Had the Former Adviser not paid these expenses, the expenses for the Funds would have been higher than what is reflected in the financial highlights for the years ended March 31, 2012, 2011, 2010, 2009 and 2008. |
See accompanying Notes to Financial Statements.
47 |
Financial Highlights (Continued)
Touchstone U.S. Long/Short Fund—Institutional Class
Selected Data for a Share Outstanding Throughout Each Period
Six Months | ||||||||||||||||||||||||||||
Ended | Three Months | |||||||||||||||||||||||||||
December 31, | Ended | |||||||||||||||||||||||||||
2012 | June 30, | Year Ended March 31, | ||||||||||||||||||||||||||
(Unaudited) | 2012 | 2012 | 2011 | 2010 | 2009 | 2008 | ||||||||||||||||||||||
Net asset value at beginning of period | $ | 12.60 | $ | 12.92 | $ | 11.86 | $ | 10.77 | $ | 7.86 | $ | 13.09 | $ | 14.20 | ||||||||||||||
Income (loss) from investment operations: | ||||||||||||||||||||||||||||
Net investment income(A) | 0.14 | 0.03 | 0.07 | 0.14 | 0.11 | 0.05 | 0.02 | |||||||||||||||||||||
Net realized and unrealized gains (losses) on investments | 0.37 | (0.35 | ) | 1.09 | 1.34 | 2.92 | (5.25 | ) | (1.05 | ) | ||||||||||||||||||
Total from investment operations | 0.51 | (0.32 | ) | 1.16 | 1.48 | 3.03 | (5.20 | ) | (1.03 | ) | ||||||||||||||||||
Distributions from: | ||||||||||||||||||||||||||||
Net investment income | (0.18 | ) | — | (0.10 | ) | (0.39 | ) | (0.12 | ) | (0.03 | ) | (0.08 | ) | |||||||||||||||
Net asset value at end of period | $ | 12.93 | $ | 12.60 | $ | 12.92 | $ | 11.86 | $ | 10.77 | $ | 7.86 | $ | 13.09 | ||||||||||||||
Total return | 4.09 | %(B) | (2.48 | )%(B) | 9.88 | % | 14.07 | % | 38.60 | % | (39.73 | )% | (7.32 | )% | ||||||||||||||
Ratios and supplemental data: | ||||||||||||||||||||||||||||
Net assets at end of period (000's) | $ | 59 | $ | 57 | $ | 7,707 | $ | 10,276 | $ | 15,735 | $ | 24,956 | $ | 44,322 | ||||||||||||||
Ratio to average net assets: | ||||||||||||||||||||||||||||
Net expenses (including dividend expense on securities sold short)(C) | 1.25 | %(D) | 1.26 | %(D) | 1.27 | % | 1.02 | % | 1.09 | % | 1.60 | % | 1.47 | % | ||||||||||||||
Gross expenses (including dividend expense on securities sold short)(E) | 22.85 | %(D) | 3.80 | %(D) | 1.45 | %(F) | 1.24 | %(F) | 1.18 | %(F) | 1.71 | %(F) | 1.63 | %(F) | ||||||||||||||
Net investment income | 2.08 | %(D) | 0.94 | %(D) | 0.64 | % | 1.33 | % | 1.16 | % | 0.50 | % | 0.18 | % | ||||||||||||||
Portfolio turnover rate | 107 | %(B) | 69 | %(B) | 231 | % | 218 | % | 200 | % | 184 | % | 236 | % |
(A) | The net investment income per share is based on average shares outstanding for the period or year. |
(B) | Not annualized. |
(C) | The ratio of net expenses to average net assets excluding dividend expense on securities sold short is 0.90%, 0.90%, 1.09%, 1.00%, 1.01%, 1.05% and 1.21% for the periods ended December 31, 2012, June 30, 2012 and years ended March 2012, 2011, 2010, 2009 and 2008, respectively. |
(D) | Annualized. |
(E) | The ratio of gross expenses to average net assets excluding dividend expense on securities sold short is 22.50%, 3.44%, 1.27%, 1.22%, 1.10%, 1.16% and 1.37% for the periods ended December 31, 2012, June 30, 2012 and years ended March 2012, 2011, 2010, 2009 and 2008, respectively. |
(F) | Legal, printing and/or compliance audit expenses relating to civil litigation and certain regulatory actions in connection with market timing allegations were incurred, and the Former Adviser paid these expenses on behalf of the Funds. Had the Former Adviser not paid these expenses, the expenses for the Funds would have been higher than what is reflected in the financial highlights for the years ended March 31, 2012, 2011, 2010, 2009 and 2008. |
See accompanying Notes to Financial Statements.
48 |
Financial Highlights (Continued)
Touchstone Value Fund—Class A
Selected Data for a Share Outstanding Throughout Each Period
Six Months | ||||||||||||||||||||||||||||
Ended | Three Months | |||||||||||||||||||||||||||
December 31, | Ended | |||||||||||||||||||||||||||
2012 | June 30, | Year Ended March 31, | ||||||||||||||||||||||||||
(Unaudited) | 2012 | 2012 | 2011 | 2010 | 2009 | 2008 | ||||||||||||||||||||||
Net asset value at beginning of period | $ | 6.95 | $ | 7.14 | $ | 6.67 | $ | 6.17 | $ | 4.00 | $ | 6.64 | $ | 8.80 | ||||||||||||||
Income (loss) from investment operations: | ||||||||||||||||||||||||||||
Net investment income(A) | 0.08 | 0.03 | 0.12 | 0.08 | 0.09 | 0.14 | 0.12 | |||||||||||||||||||||
Net realized and unrealized gains | ||||||||||||||||||||||||||||
(losses) on investments | 0.30 | (0.16 | ) | 0.45 | 0.50 | 2.17 | (2.66 | ) | (0.97 | ) | ||||||||||||||||||
Total from investment operations | 0.38 | (0.13 | ) | 0.57 | 0.58 | 2.26 | (2.52 | ) | (0.85 | ) | ||||||||||||||||||
Distributions from: | ||||||||||||||||||||||||||||
Net investment income | (0.08 | ) | (0.06 | ) | (0.10 | ) | (0.08 | ) | (0.09 | ) | (0.12 | ) | (0.17 | ) | ||||||||||||||
Realized capital gains | (0.23 | ) | — | — | — | — | — | (1.14 | ) | |||||||||||||||||||
Total distributions | (0.31 | ) | (0.06 | ) | (0.10 | ) | (0.08 | ) | (0.09 | ) | (0.12 | ) | (1.31 | ) | ||||||||||||||
Net asset value at end of period | $ | 7.02 | $ | 6.95 | $ | 7.14 | $ | 6.67 | $ | 6.17 | $ | 4.00 | $ | 6.64 | ||||||||||||||
Total return(B) | 5.47 | %(C) | (1.83 | )%(C) | 8.77 | % | 9.59 | % | 57.05 | % | (38.39 | )% | (11.68 | )% | ||||||||||||||
Ratios and supplemental data: | ||||||||||||||||||||||||||||
Net assets at end of period (000's) | $ | 40,569 | $ | 1,583 | $ | 1,606 | $ | 2,325 | $ | 2,514 | $ | 2,530 | $ | 2,379 | ||||||||||||||
Ratio to average net assets: | ||||||||||||||||||||||||||||
Net expenses | 1.08 | %(D) | 1.20 | %(D) | 1.20 | % | 1.20 | % | 1.26 | % | 1.35 | % | 1.35 | % | ||||||||||||||
Gross expenses | 1.43 | %(D) | 3.49 | %(D) | 1.96 | %(E) | 2.04 | %(E) | 1.76 | %(E) | 2.23 | %(E) | 2.38 | %(E) | ||||||||||||||
Net investment income | 2.09 | %(D) | 1.68 | %(D) | 1.84 | % | 1.31 | % | 1.72 | % | 2.76 | % | 1.36 | % | ||||||||||||||
Portfolio turnover rate | 72 | %(C)(F) | 13 | %(C) | 15 | % | 13 | % | 25 | % | 17 | % | 10 | % |
Touchstone Value Fund—Class C |
Selected Data for a Share Outstanding Throughout Each Period |
Six Months | ||||||||
Ended | Period | |||||||
December 31, | Ended | |||||||
2012 | June 30, | |||||||
(Unaudited) | 2012(G) | |||||||
Net asset value at beginning of period | $ | 6.95 | $ | 6.90 | ||||
Income from investment operations: | ||||||||
Net investment income(A) | 0.05 | 0.01 | ||||||
Net realized and unrealized gains on investments | 0.30 | 0.10 | ||||||
Total from investment operations | 0.35 | 0.11 | ||||||
Distributions from: | ||||||||
Net investment income | (0.05 | ) | (0.06 | ) | ||||
Realized capital gains | (0.23 | ) | — | |||||
Total distributions | (0.28 | ) | (0.06 | ) | ||||
Net asset value at end of period | $ | 7.02 | $ | 6.95 | ||||
Total return(B) | 5.04 | %(C) | 1.56 | %(C) | ||||
Ratios and supplemental data: | ||||||||
Net assets at end of period (000's) | $ | 2,564 | $ | 3 | ||||
Ratio to average net assets: | ||||||||
Net expenses | 1.83 | %(D) | 1.95 | %(D) | ||||
Gross expenses | 2.45 | %(D) | 929.36 | %(D) | ||||
Net investment income | 1.34 | %(D) | 0.93 | %(D) | ||||
Portfolio turnover rate | 72 | %(C)(F) | 13 | %(C) |
(A) | The net investment income per share is based on average shares outstanding for the period or year. |
(B) | Total returns shown exclude the effect of applicable sales loads. If these charges were included, the returns would be lower. |
(C) | Not annualized. |
(D) | Annualized. |
(E) | Legal, printing and/or compliance audit expenses relating to civil litigation and certain regulatory actions in connection with market timing allegations were incurred, and the Former Adviser paid these expenses on behalf of the Funds. Had the Former Adviser not paid these expenses, the expenses for the Funds would have been higher than what is reflected in the financial highlights for the years ended March 31, 2012, 2011, 2010, 2009 and 2008. |
(F) | Portfolio turnover excludes the purchase and sales of the Acquired Fund (see Note 7). If these transactions were included, portfolio turnover would have been higher. |
(G) | The Fund began issuing Class C shares on April 12, 2012. |
See accompanying Notes to Financial Statements.
49 |
Financial Highlights (Continued)
Touchstone Value Fund—Class Y
Selected Data for a Share Outstanding Throughout Each Period
Six Months | ||||||||||||||||||||||||||||
Ended | Three Months | |||||||||||||||||||||||||||
December 31, | Ended | |||||||||||||||||||||||||||
2012 | June 30, | Year Ended March 31, | ||||||||||||||||||||||||||
(Unaudited) | 2012 | 2012 | 2011 | 2010 | 2009 | 2008 | ||||||||||||||||||||||
Net asset value at beginning of period | $ | 6.97 | $ | 7.16 | $ | 6.69 | $ | 6.19 | $ | 4.01 | $ | 6.65 | $ | 8.82 | ||||||||||||||
Income (loss) from investment operations: | ||||||||||||||||||||||||||||
Net investment income(A) | 0.09 | 0.03 | 0.12 | 0.09 | 0.10 | 0.16 | 0.14 | |||||||||||||||||||||
Net realized and unrealized gains (losses) on investments | 0.30 | (0.15 | ) | 0.47 | 0.51 | 2.19 | (2.68 | ) | (0.97 | ) | ||||||||||||||||||
Total from investment operations | 0.39 | (0.12 | ) | 0.59 | 0.60 | 2.29 | (2.52 | ) | (0.83 | ) | ||||||||||||||||||
Distributions from: | ||||||||||||||||||||||||||||
Net investment income | (0.09 | ) | (0.07 | ) | (0.12 | ) | (0.10 | ) | (0.11 | ) | (0.12 | ) | (0.20 | ) | ||||||||||||||
Realized capital gains | (0.23 | ) | — | — | — | — | — | (1.14 | ) | |||||||||||||||||||
Total distributions | (0.32 | ) | (0.07 | ) | (0.12 | ) | (0.10 | ) | (0.11 | ) | (0.12 | ) | (1.34 | ) | ||||||||||||||
Net asset value at end of period | $ | 7.04 | $ | 6.97 | $ | 7.16 | $ | 6.69 | $ | 6.19 | $ | 4.01 | $ | 6.65 | ||||||||||||||
Total return | 5.57 | %(B) | (1.69 | )%(B) | 9.01 | % | 9.86 | % | 57.65 | % | (38.29 | )% | (11.49 | )% | ||||||||||||||
Ratios and supplemental data: | ||||||||||||||||||||||||||||
Net assets at end of period (000's) | $ | 95,999 | $ | 51,447 | $ | 87,546 | $ | 86,659 | $ | 88,766 | $ | 67,325 | $ | 86,801 | ||||||||||||||
Ratio to average net assets: | ||||||||||||||||||||||||||||
Net expenses | 0.83 | %(C) | 0.95 | %(C) | 0.95 | % | 0.95 | % | 1.00 | % | 1.10 | % | 1.10 | % | ||||||||||||||
Gross expenses | 1.14 | %(C) | 1.23 | %(C) | 1.03 | %(D) | 1.04 | %(D) | 1.07 | %(D) | 1.22 | %(D) | 1.37 | %(D) | ||||||||||||||
Net investment income | 2.34 | %(C) | 1.93 | %(C) | 1.90 | % | 1.58 | % | 1.87 | % | 3.03 | % | 1.59 | % | ||||||||||||||
Portfolio turnover rate | 72 | %(B)(E) | 13 | %(B) | 15 | % | 13 | % | 25 | % | 17 | % | 10 | % |
Touchstone Value Fund—Institutional Class |
Selected Data for a Share Outstanding Throughout Each Period |
Six Months | ||||||||||||||||||||||||||||
Ended | Three Months | |||||||||||||||||||||||||||
December 31, | Ended | |||||||||||||||||||||||||||
2012 | June 30, | Year Ended March 31, | ||||||||||||||||||||||||||
(Unaudited) | 2012 | 2012 | 2011 | 2010 | 2009 | 2008 | ||||||||||||||||||||||
Net asset value at beginning of period | $ | 6.96 | $ | 7.15 | $ | 6.68 | $ | 6.18 | $ | 4.01 | $ | 6.63 | $ | 8.83 | ||||||||||||||
Income (loss) from investment operations: | ||||||||||||||||||||||||||||
Net investment income(A) | 0.09 | 0.03 | 0.13 | 0.10 | 0.11 | 0.17 | 0.41 | |||||||||||||||||||||
Net realized and unrealized gains (losses) on investments | 0.30 | (0.16 | ) | 0.46 | 0.51 | 2.18 | (2.66 | ) | (1.25 | ) | ||||||||||||||||||
Total from investment operations | 0.39 | (0.13 | ) | 0.59 | 0.61 | 2.29 | (2.49 | ) | (0.84 | ) | ||||||||||||||||||
Distributions from: | ||||||||||||||||||||||||||||
Net investment income | (0.09 | ) | (0.06 | ) | (0.12 | ) | (0.11 | ) | (0.12 | ) | (0.13 | ) | (0.22 | ) | ||||||||||||||
Realized capital gains | (0.23 | ) | — | — | — | — | — | (1.14 | ) | |||||||||||||||||||
Total distributions | (0.32 | ) | (0.06 | ) | (0.12 | ) | (0.11 | ) | (0.12 | ) | (0.13 | ) | (1.36 | ) | ||||||||||||||
Net asset value at end of period | $ | 7.03 | $ | 6.96 | $ | 7.15 | $ | 6.68 | $ | 6.18 | $ | 4.01 | $ | 6.63 | ||||||||||||||
Total return | 5.63 | %(B) | (1.62 | )%(B) | 9.13 | % | 9.99 | % | 57.64 | % | (38.06 | )% | (11.57 | )% | ||||||||||||||
Ratios and supplemental data: | ||||||||||||||||||||||||||||
Net assets at end of period (000's) | $ | 167,722 | $ | 69,549 | $ | 33,727 | $ | 42,106 | $ | 51,274 | $ | 44,011 | $ | 51,690 | ||||||||||||||
Ratio to average net assets: | ||||||||||||||||||||||||||||
Net expenses | 0.73 | %(C) | 0.85 | %(C) | 0.85 | % | 0.85 | % | 0.87 | % | 0.90 | % | 0.90 | % | ||||||||||||||
Gross expenses | 0.99 | %(C) | 1.09 | %(C) | 0.88 | %(D) | 0.89 | %(D) | 0.90 | %(D) | 1.02 | %(D) | 1.02 | %(D) | ||||||||||||||
Net investment income | 2.44 | %(C) | 2.04 | %(C) | 2.00 | % | 1.67 | % | 2.01 | % | 3.24 | % | 2.00 | % | ||||||||||||||
Portfolio turnover rate | 72 | %(B)(E) | 13 | %(B) | 15 | % | 13 | % | 25 | % | 17 | % | 10 | % |
(A) | The net investment income per share is based on average shares outstanding for the period or year. |
(B) | Not annualized. |
(C) | Annualized. |
(D) | Legal, printing and/or compliance audit expenses relating to civil litigation and certain regulatory actions in connection with market timing allegations were incurred, and the Former Adviser paid these expenses on behalf of the Funds. Had the Former Adviser not paid these expenses, the expenses for the Funds would have been higher than what is reflected in the financial highlights for the years ended March 31, 2012, 2011, 2010, 2009 and 2008. |
(E) | Portfolio turnover excludes the purchase and sales of the Acquired Fund (see Note 7). If these transactions were included, portfolio turnover would have been higher. |
See accompanying Notes to Financial Statements.
50 |
Notes to Financial Statements
December 31, 2012 (Unaudited)
1. Organization
The Touchstone Strategic Trust (the “Trust”) is registered under the Investment Company Act of 1940, as amended, (the “1940 Act”) as an open-end management investment company. The Trust was established as a Massachusetts business trust under a Declaration of Trust dated November 18, 1982. The Trust consists of twenty two funds including the following six funds, individually, a “Fund”, and collectively, the “Funds”:
Touchstone Capital Growth Fund (“Capital Growth Fund”)
Touchstone International Small Cap Fund (“International Small Cap Fund”)
Touchstone Mid Cap Value Opportunities Fund (“Mid Cap Value Opportunities Fund”)
Touchstone Small Cap Value Opportunities Fund (“Small Cap Value Opportunities Fund”)
Touchstone U.S. Long/Short Fund (“U.S. Long/Short Fund”)
Touchstone Value Fund (“Value Fund”)
Each Fund is an open-end, diversified management investment company, with the exception of Capital Growth Fund and Value Fund, each of which is an open-end, non-diversified management investment company.
The Declaration of Trust permits the Trust to issue an unlimited number of shares of beneficial interest of each Fund. The Funds are registered to offer different classes of shares: Class A shares, Class C shares, Class Y shares, and Institutional Class shares. The assets of each Fund are segregated, and a shareholder’s interest is limited to the Fund in which shares are held. The Funds’ prospectus provides a description of each Fund’s investment objectives, policies, and strategies along with information on the classes of shares currently being offered.
2. Significant Accounting Policies
The following is a summary of the Funds’ significant accounting policies:
Security valuation and fair value measurements — All investments in securities are recorded at their estimated fair value. The Funds define the term “market value”, as used throughout this annual report, as the estimated fair value. The Funds use various methods to measure fair value of their portfolio securities on a recurring basis. Generally accepted accounting principles in the United States (“U.S. GAAP”) establish a hierarchy that prioritizes inputs to valuation methods. These inputs are summarized in the three broad levels listed below:
• | Level 1 – | quoted prices in active markets for identical securities |
• | Level 2 – | other significant observable inputs (including quoted prices for similar securities, interest rates, prepayment speeds, credit risk, etc.) |
• | Level 3 – | significant unobservable inputs (including a Fund’s own assumptions in determining the fair value of investments) |
The inputs or methodology used for valuing securities are not necessarily an indication of the risk associated with investing in those securities. For example, money market instruments are valued using amortized cost, in accordance with rules under the 1940 Act. Generally, amortized cost approximates the current fair value of a security, but since the value is not obtained from a quoted price in an active market, such securities are reflected as Level 2.
The aggregate value by input level, as of December 31, 2012, for each Fund’s investments, as well as a reconciliation of assets for which significant unobservable inputs (Level 3) were used in determining value, if applicable, is included in each Fund’s Portfolio of Investments, which also includes a breakdown of the Fund’s investments by geographic/industry concentration. The Funds did not hold any Level 3 categorized securities during the six months ended December 31, 2012.
51 |
Notes to Financial Statements (Continued)
All transfers in and out of the levels are recognized at the value at the end of the period. During the six months ended December 31, 2012, there were no transfers between Levels 1, 2 and 3 for all Funds.
The Funds’ portfolio securities are valued as of the close of the regular session of trading on the New York Stock Exchange (“NYSE”) (currently 4:00 p.m., Eastern time). Portfolio securities traded on stock exchanges are valued at the last sale price, and to the extent these securities are actively traded, they are categorized in Level 1 of the fair value hierarchy. Portfolio securities quoted by NASDAQ are valued at the NASDAQ Official Closing Price (“NOCP”). Securities not traded on a particular day, or for which the last sale price is not readily available, are valued at their last broker-quoted bid prices as obtained from one or more of the major market makers for such securities by an independent pricing service and are categorized in Level 2. Money market instruments and other debt securities with a remaining maturity of less than 60 days are valued at amortized cost, which approximates market value and are categorized in Level 2. While this method provides consistency in valuation (and may only be used if it approximates market value), it may result in periods during which value, as determined by amortized cost, is higher or lower than the price that would be received if the Fund sold the investment. Securities for which market quotations or the NOCP are not readily available are fair valued as determined by or under the direction of the Board of Trustees and are categorized in Level 3. Shares of open end mutual funds in which the Funds invest are valued at their respective net asset values as reported by the underlying funds and are categorized in Level 1. The prices for foreign securities are reported in local currency and translated into U.S. dollars using currency exchange rates.
Level 2 Valuation— Securities mainly traded on a non-U.S. exchange are generally valued according to the preceding closing values on that exchange. However, if an event that may change the value of a security occurs after the time that the closing value on the non-U.S. exchange was determined, but before the close of regular trading on the NYSE, the security may be priced based on fair value. This may cause the value of the security on the books of the Fund to be significantly different from the closing value on the non-U.S. exchange and may affect the calculation of the net asset value (“NAV”) of the Funds. Any debt securities held by the Fund for which market quotations are not readily available are generally priced at their most recent bid prices as obtained from one or more of the major market makers for such securities.
Level 3 Valuation— Securities held by the Funds that do not have readily available market quotations, or securities for which the available market quotations are not reliable, are priced at their fair values using procedures approved by the Board of Trustees. The Funds may use fair value pricing under the following circumstances, among others:
• | If the value of a security has been materially affected by events occurring before the Fund’s pricing time but after the close of the primary markets on which the security is traded. |
• | If the exchange on which a portfolio security is principally traded closes early or if trading in a particular portfolio security was halted during the day and did not resume prior to the Fund’s NAV calculation. |
• | If a security is so thinly traded that reliable market quotations are unavailable due to infrequent trading. |
• | If the validity of market quotations is not reliable. |
New accounting pronouncements — In December 2011, the Financial Accounting Standards Board issued Accounting Standards Update (“ASU”) No. 2011-11, “Disclosures about Offsetting Assets and Liabilities”. ASU No. 2011-11 requires disclosures to make financial statements that are prepared under U.S. GAAP more comparable to those prepared under the International Financial Reporting Standards. The new disclosure requirements mandate that entities disclose both gross and net information about instruments and transactions eligible for offset in the statement of assets and liabilities as well as instruments and transactions subject to an agreement similar to a master netting arrangement. In addition, ASU No. 2011-11 requires disclosure of collateral received and posted in connection with master netting agreements or similar arrangements. New disclosures
52 |
Notes to Financial Statements (Continued)
are required for annual reporting periods beginning on or after January 1, 2013, and interim periods within those annual periods. Management is evaluating the impact of ASU No. 2011-11 on the financial statements and disclosures.
Cash and Cash Equivalents — The Funds consider liquid assets deposited with a bank, money market funds, and certain short term debt instruments with maturities of 3 months or less to be cash equivalents and are included in the investments on the financial statements. These investments represent amounts held with financial institutions that are readily accessible to pay Fund expenses or investments. Cash and cash equivalents are valued at cost plus accrued interest, which approximates market value. The value of cash equivalents denominated in foreign currencies is determined by converting to U. S. dollars on the date of the statement of assets and liabilities.
Futures Contracts — A fund may buy and sell futures contracts and related options to manage its exposure to changing interest rates and securities prices. Some strategies reduce a Fund’s exposure to price fluctuations, while others tend to increase its market exposure. Futures and options on futures can be volatile instruments and involve certain risks that could negatively impact a Fund’s return. In order to avoid leveraging and related risks, when a Fund purchases futures contracts, it will collateralize its position by depositing an amount of cash or liquid securities, equal to the market value of the futures positions held, less margin deposits, in a segregated account with its custodian or otherwise “cover” its position in a manner consistent with the 1940 Act or the rules of the Securities and Exchange Commission interpretations thereunder. Collateral equal to the current market value of the futures position will be marked to market on a daily basis.
When the contract is closed, the Fund records a realized gain or loss equal to the difference between the proceeds from (or cost of ) the closing transactions and the Fund’s basis in the contract. Risks of entering into futures contracts include the possibility that a change in the value of the contract may not correlate with the changes in the value of the underlying instruments. Second, it is possible that a lack of liquidity for futures contracts could exist in the secondary market resulting in an inability to close a futures position prior to its maturity date. Third, the purchase of a futures contract involves the risk that the funds could lose more than the original margin deposit required to initiate the futures transaction. Finally, the risk exists that losses could exceed amounts disclosed on the Statements of Assets and Liabilities. There is minimal counterparty credit risk involved in entering into futures contracts since they are exchange-traded instruments and the exchange’s clearinghouse, as counterparty to all exchange-traded futures, guarantees the futures against default.
Securities sold short — The U.S. Long/Short Fund engages in selling securities short, which obligates the Fund to replace a security borrowed by purchasing the same security at the current market value. The Fund would 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 would realize a gain if the price of the security declines between those dates. As of December 31, 2012, the Fund had securities sold short with a fair value of ($2,512,748) and had securities with a fair value of $14,607,797 held as collateral for securities sold short.
Foreign currency translation — The books and records of the Funds are maintained in U.S. dollars and translated into U.S. dollars on the following basis:
(1) | market value of investment securities, assets and liabilities at the current rate of exchange on the valuation date; and |
(2) | purchases and sales of investment securities, income and expenses at the relevant rates of exchange prevailing on the respective dates of such transactions. |
The Funds do not isolate that portion of gains and losses on investments in equity securities that is due to changes in the foreign exchange rates from that which is due to changes in market prices of equity securities.
53 |
Notes to Financial Statements (Continued)
Derivative instruments and hedging activities — The International Small Cap Fund held derivative instruments during the six months ended December 31, 2012. At December 31, 2012, the International Small Cap Fund did not hold any derivative instruments.
For the six months ended December 31, 2012, the average quarterly balance of outstanding derivative financial instruments were as follows:
International | ||||
Small Cap | ||||
Fund | ||||
Equity Contracts: | ||||
Warrants -Average number of contracts | $ | 56,566 |
The Effect of Derivative Investments on the Statement of Operations | ||||||||||
for the Period Ended December 31, 2012 | ||||||||||
Change in | ||||||||||
Unrealized | ||||||||||
Appreciation | ||||||||||
Derivatives not accounted for as hedging | Realized Loss | (Depreciation) | ||||||||
Fund | instruments under ASC 815 | on Derivatives* | on Derivatives** | |||||||
International Small Cap Fund | Warrants - Equity Contracts | $ | 6,346 | $ | (2,824 | ) |
* Statements of Operations Location: Net realized gain on warrants and net realized gain (loss) on future transactions.
** Statements of Operations Location: Net change in unrealized appreciation (depreciation) on investments.
Portfolio securities loaned — Each Fund may lend its portfolio securities. Lending portfolio securities exposes a Fund to the risk that the borrower may fail to return the loaned securities or may not be able to provide additional collateral or that the Fund may experience delays in recovery of the loaned securities or loss of rights in the collateral if the borrower fails financially. To minimize these risks, the borrower must agree to maintain cash collateral with the Funds’ custodian in an amount at least equal to the market value of the securities loaned plus accrued interest, if any. When the collateral falls below specified amounts the lending agent will use its best effort to obtain additional collateral on the next business day to meet required amounts under the security lending agreement. The cash collateral is reinvested by the Funds’ custodian into an approved investment vehicle.
As of December 31, 2012, the following Funds loaned securities and received collateral as follows:
Market | Market | |||||||
Value of | Value of | |||||||
Securities | Collateral | |||||||
Fund | Loaned | Received | ||||||
International Small Cap Fund | $ | 1,542,936 | $ | 1,601,443 | ||||
Mid Cap Value Opportunities Fund | 5,742,445 | 6,249,304 | ||||||
Small Cap Value Opportunities Fund | 8,566,841 | 8,660,912 |
All collateral received as cash is received, held and administered by the Funds’ custodian for the benefit of the Funds in the applicable custody account or other account established for the purpose of holding collateral.
Funds participating in securities lending receive compensation in the form of fees, or retain a portion of interest or dividends on the investment of any cash received as collateral. The Funds also continue to receive interest or dividends on the securities loaned.
Unrealized gain or loss on the market value of the securities loaned that may occur during the term of the loan is recognized by the Funds. The Funds have the right under the lending agreement to recover the securities from the borrower on demand.
54 |
Notes to Financial Statements (Continued)
Share valuation — The NAV per share of each class of shares of each Fund is calculated daily by dividing the total value of a Fund’s assets attributable to that class, less liabilities attributable to that class, by the number of outstanding shares of that class.
The maximum offering price per share of Class A shares of the Funds is equal to the net asset value per share plus a sales load equal to 6.10% of the net asset value (or 5.75% of the offering price). There is no sales load on purchases of $1 million or more of Class A shares. The maximum offering price per share of Class C, Class Y, and Institutional Class shares of the Funds is equal to the net asset value per share.
The redemption price per share of each class of shares of the Funds is generally equal to the net asset value per share. However, Class A redemptions that were part of a no load $1 million subscription may be subject to a contingent deferred sales charge (“CDSC”) of up to 1%. Purchases of Class C shares of the Funds are subject to a CDSC of 1.00% of the original purchase price if redeemed within a one-year period from the date of purchase.
Investment income — Dividend income from securities is recognized on the ex-dividend date, net of foreign withholding taxes, if any, which are reduced by any amounts reclaimable by the Funds, where applicable. Interest income from securities is recorded on the basis of interest accrued, premium amortized and discount accreted.
Distributions to shareholders — Each Fund intends to distribute to its shareholders substantially all of its income and capital gains. Each Fund, except the Value Fund, declares and distributes net investment income, if any, annually, as a dividend to shareholders. The Value Fund declares and distributes net investment income, if any, semi-annually, as a dividend to shareholders. Each Fund makes distributions of capital gains, if any, at least annually, net of applicable capital loss carryforwards. Income distributions and capital gain distributions are determined in accordance with income tax regulations.
Allocations — Investment income earned, realized capital gains and losses, and unrealized appreciation and depreciation for the Funds are allocated daily to each class of shares based upon its proportionate share of total net assets of a Fund. Class specific expenses are charged directly to the class incurring the expense. Common expenses, which are not attributable to a specific class, are allocated daily to each class of shares based upon their proportionate share of total net assets of the Fund. Expenses not directly billed to a Fund are allocated proportionally among all Funds daily in relation to net assets of each Fund or another reasonable measure.
Security transactions — Security transactions are reflected for financial reporting purposes as of the trade date, which may cause the NAV as stated in the accompanying financial statements to be different than the NAV applied to Fund share transactions. Realized gains and losses on sales of portfolio securities are calculated using the identified cost basis.
Estimates — The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of income and expenses during the reporting period. Actual results could differ from those estimates.
Redemption fees — Prior to April 16, 2012, each Fund imposed a 2% redemption/exchange fee on total redemption proceeds (after applicable deferred sales charges) of any shareholder redeeming shares (including redemption by exchange) of the Funds within 10 calendar days of their purchase. The Funds charged the redemption/exchange fee to discourage market timing by those shareholders initiating redemptions or exchanges to take advantage of short-term market movements. The redemption/exchange fee was imposed to the extent that the number of Fund shares redeemed exceeded the number of Fund shares that were held for more than 10 calendar days. In determining how long shares of the Fund have been held, shares held by the shareholder for the longest period of time were sold first. The Funds retained the redemption/exchange fee for the benefit of the remaining
55 |
Notes to Financial Statements (Continued)
shareholders by crediting Paid-in-Capital. The redemption fees can be found on the Statement of Changes in Net Assets. Effective April 16, 2012, the redemption fee plan was terminated.
3. Investment Transactions
Investment transactions (excluding short-term investments and U.S. Government securities) were as follows for the six months ended December 31, 2012:
International | Mid Cap Value | |||||||||||
Capital Growth | Small Cap | Opportunities | ||||||||||
Fund | Fund | Fund | ||||||||||
Purchases of investment securities | $ | 39,950,352 | $ | 44,748,220 | $ | 43,615,513 | ||||||
Proceeds from sales and maturities | $ | 51,669,364 | $ | 37,987,501 | $ | 57,364,908 |
Small Cap | ||||||||||||
Value | U.S. | |||||||||||
Opportunities | Long/Short | Value | ||||||||||
Fund | Fund | Fund | ||||||||||
Purchases of investment securities* | $ | 52,413,021 | $ | 16,414,225 | $ | 161,628,731 | ||||||
Proceeds from sales and maturities | $ | 55,189,379 | $ | 18,359,400 | $ | 212,767,363 |
* The cost of purchases excludes $197,202,959 on Value Fund from securities received from the Acquired Funds. See Note 7 in the Notes to Financial Statements.
There were no purchases or sales of U.S. government securities for the six months ended December 31, 2012.
4. Transactions with Affiliates and Other Related Parties
Certain officers of the Trust are also officers of Touchstone Advisors, Inc. (the “Advisor”), Touchstone Securities, Inc. (the “Underwriter”) and/or BNY Mellon Investment Servicing (U.S) Inc. (“BNY Mellon”), the Sub-Administrator and Transfer Agent to the Funds. The Advisor and Underwriter are each wholly owned, indirect subsidiaries of The Western and Southern Life Insurance Company (“Western-Southern”).
MANAGEMENT & EXPENSE LIMITATIONS AGREEMENTS
The Advisor provides general investment supervisory services for the Funds. Under the Advisory Agreement, the Funds pay the Advisor a fee, which is computed and accrued daily and paid monthly, at an annual rate based on average daily net assets as shown in the table below.
Touchstone Capital Growth Fund | 0.70% on the first $300 million |
0.685% on the next $200 million | |
0.675% on the next $250 million | |
0.675% on the next $250 million | |
0.625% on the next $500 million | |
0.575% on the next $500 million | |
0.525% of such assets over $2 billion | |
Touchstone International Small Cap Fund | 0.95% on the first $300 million |
0.90% on the next $200 million | |
0.85% on the next $250 million | |
0.80% on the next $250 million | |
0.75% on the next $500 million | |
0.70% on the next $500 million | |
0.65% of such assets over $2 billion |
56 |
Notes to Financial Statements (Continued)
Touchstone Mid Cap Value Opportunities Fund | 0.85% on the first $300 million |
0.80% on the next $200 million | |
0.75% of such assets over $500 million | |
Touchstone Small Cap Value Opportunities Fund | 0.95% on the first $300 million |
0.90% on the next $200 million | |
0.85% of such assets over $500 million | |
Touchstone U.S. Long/Short Fund | 0.80% on the first $300 million |
0.75% on the next $200 million | |
0.70% on the next $250 million | |
0.65% on the next $250 million | |
0.60% on the next $500 million | |
0.55% on the next $500 million | |
0.50% of such assets over $2 billion | |
Touchstone Value Fund | 0.75% on the first $300 million |
0.73% on the next $200 million | |
0.72% on the next $250 million | |
0.70% on the next $250 million | |
0.68% on the next $500 million | |
0.67% on the next $500 million | |
0.66% of such assets over $2 billion |
The Advisor has entered into investment sub-advisory agreements with the following parties (each, a “Sub-Advisor”):
Analytic Investors, LLC | Copper Rock Capital Partners LLC |
U.S. Long/Short Fund | International Small Cap Fund |
Ashfield Capital Partners, LLC | |
Capital Growth Fund | Thompson Siegel & Walmsley LLC |
Mid Cap Value Opportunities Fund | |
Barrow, Hanley, Mewhinney & Strauss, LLC | Small Cap Value Opportunities Fund |
Value Fund |
The Advisor, not the Funds, pays the sub-advisory fees to each Sub-Advisor.
The Advisor entered into an expense limitation agreement (“Expense Limitation Agreement”) to contractually limit operating expenses of the Funds, excluding dividend expenses on short sales, interest, taxes, brokerage commissions, other expenditures which are capitalized in accordance with generally accepted accounting principles, the cost of “Acquired Fund Fees and Expenses”, if any, and other extraordinary expenses not incurred in the ordinary course of business. The maximum operating expense limit in any year with respect to the Funds is based on a percentage of the average daily net assets of the Funds. The Advisor has agreed to separately waive class level expenses, administration fees and reimburse expenses in order to maintain expense limitations for the Funds as follows:
57 |
Notes to Financial Statements (Continued)
Institutional | ||||||||||||||||
Class A | Class C | Class Y | Class | |||||||||||||
Capital Growth Fund | 1.25 | % | 2.00 | % | 1.00 | % | 0.90 | % | ||||||||
International Small Cap Fund | 1.55 | % | 2.30 | % | 1.30 | % | 1.05 | % | ||||||||
Mid Cap Value Opportunities Fund | 1.29 | % | 2.04 | % | 1.04 | % | 0.89 | % | ||||||||
Small Cap Value Opportunities Fund | 1.50 | % | 2.25 | % | 1.25 | % | 1.10 | % | ||||||||
U.S. Long/Short Fund | 1.30 | % | 2.05 | % | 1.05 | % | 0.90 | % | ||||||||
Value Fund* | 1.00 | % | 1.75 | % | 0.75 | % | 0.65 | % |
* Prior to September 10, 2012 the expense limitation for Class A, Class C, Class Y and Institutional Class Shares were 1.20%, 1.95%, 0.95% and 0.85%, respectively.
The expense limitations in the Expense Limitation Agreement will remain in effect until at least April 16, 2014 for all Funds except the Value Fund. The expense limitation for the Value Fund will remain in effect until September 10, 2013.
Effective September 12, 2012, the Advisor amended the Expense Limitation Agreement for the Value Fund. In accordance with the amended Expense Limitation Agreement, the Advisor has contractually agreed to waive a portion of its fees and/or reimburse certain Fund expenses in order to limit annual fund operating expenses to 1.08%, 1.83%, 0.83% and 0.68% for Class A shares, Class C shares, Class Y shares, and Institutional shares, respectively. These limitations will remain in effect until April 16, 2014. For periods where multiple caps are in effect, the lower of the two amounts will apply.
During the six months ended December 31, 2012, the Advisor waived investment advisory fees and administration fees and/or reimbursed expenses of the Funds as follows:
Other | ||||||||||||
Investment | Operating | |||||||||||
Advisory | Administration | Expenses | ||||||||||
Fees Waived | Fees Waived | Reimbursed | ||||||||||
Capital Growth Fund | $ | — | $ | 61,899 | $ | 141,397 | ||||||
International Small Cap Fund | 41,253 | 86,611 | 24,384 | |||||||||
Mid Cap Value Opportunities Fund | 16,732 | 90,510 | 31,173 | |||||||||
Small Cap Value Opportunities Fund | — | 43,396 | 24,497 | |||||||||
U.S. Long/Short Fund | 15,879 | 11,702 | 28,855 | |||||||||
Value Fund | 76,225 | 212,667 | 55,164 |
Under the terms of the Expense Limitation Agreement, the Advisor is entitled to recover, subject to approval by the Funds’ Board of Trustees, such amounts waived or reimbursed for a period of up to three years from the year in which the Advisor reduced its compensation and/or assumed expenses for a Fund. No recoupment will occur unless a Fund’s operating expenses are below the expense limitation amount.
The Advisor did not recoup any amounts it previously waived or reimbursed during the six months ended December 31, 2012.
At December 31, 2012, the Advisor may seek recoupment of previously waived and reimbursed fees as follows:
Expiration | Expiration | |||||||
June 30, | December 31, | |||||||
2015 | 2015 | |||||||
Capital Growth Fund | $ | 118,022 | $ | 202,367 | ||||
International Small Cap Fund | 108,590 | 151,880 | ||||||
Mid Cap Value Opportunities Fund | 98,290 | 136,611 | ||||||
Small Cap Value Opportunities Fund | 59,632 | 64,652 | ||||||
U.S. Long/Short Fund | 61,827 | 54,586 |
58 |
Notes to Financial Statements (Continued)
Expiration | Expiration | |||||||
June 30, | December 31, | |||||||
2015 | 2015 | |||||||
Value Fund | 81,083 | 328,135 |
ADMINISTRATION AGREEMENT
The Advisor entered into an Administration and Accounting Services Agreement with the Trust, whereby the Advisor is responsible for: supplying executive and regulatory compliance services; supervising the preparation of tax returns; coordinating the preparation of reports to shareholders and reports to, and filings with, the Securities and Exchange Commission and state securities authorities, as well as materials for meetings of the Board of Trustees; calculating the daily net asset value per share; and maintaining the financial books and records of each Fund. For its services, the Advisor receives an annual fee of 0.20% of the aggregate average daily net assets of the Trust, Touchstone Investment Trust (excluding Institutional Money Market Fund), Touchstone Funds Group Trust, and Touchstone Tax-Free Trust up to and including $6 billion; 0.16% of the next $4 billion of aggregate average daily net assets; and 0.12% of the aggregate average daily net assets of all such assets in excess of $10 billion. The fee is allocated among the Funds on the basis of relative daily net assets.
The Advisor has engaged BNY Mellon as the Sub-Administrator to the Trust. BNY Mellon provides administrator and accounting services to the Trust and is compensated directly by the Advisor, not the Trust.
TRANSFER AGENT AGREEMENT
Under the terms of the Transfer Agent Agreement between the Trust and BNY Mellon, BNY Mellon maintains the records of each shareholder’s account, answers shareholders’ inquiries concerning their accounts, processes purchases and redemptions of each Fund’s shares, acts as dividend and distribution disbursing agent and performs other shareholder service functions. For these services, BNY Mellon receives a monthly fee per shareholder account from each Fund. In addition, each Fund pays out-of-pocket expenses incurred by BNY Mellon, including, but not limited to, postage and supplies.
PLANS OF DISTRIBUTION AND SHAREHOLDER SERVICING FEE ARRANGEMENTS
The Trust has adopted distribution plans pursuant to Rule 12b-1 under the 1940 Act for each class of shares it offers that are subject to 12b-1 distribution fees. The plans allow each Fund to pay distribution and other fees for the sale and distribution of its shares and for services provided to shareholders. Under the Class A plan, each Fund offering Class A shares pays an annual fee of up to 0.25% of average daily net assets that are attributable to Class A shares. Under the Class C plan, each Fund pays an annual fee of up to 1.00% of average daily net assets that are attributable to Class C shares (of which up to 0.75% is a distribution fee and up to 0.25% is a shareholder servicing fee).
UNDERWRITING AGREEMENT
The Underwriter is the Funds’ principal underwriter and, as such, acts as exclusive agent for distribution of the Funds’ shares. Under the terms of the Underwriting Agreement between the Trust and Underwriter, the Underwriter earned the following from underwriting and broker commissions on the sale of shares of the following Funds during the six months ended December 31, 2012:
Amount | ||||
Capital Growth Fund | $ | 7,477 | ||
International Small Cap Fund | 4,198 | |||
Small Cap Value Opportunities Fund | 707 | |||
U.S. Long/Short Fund | 449 | |||
Value Fund | 12,703 |
59 |
Notes to Financial Statements (Continued)
AFFILIATED INVESTMENTS
Each Fund may invest in the Touchstone Institutional Money Market Fund, subject to compliance with several conditions set forth in an order received by the Trust from the Securities and Exchange Commission. To the extent that the other Touchstone Funds are invested in the Touchstone Institutional Money Market Fund, the Advisor and Administrator will be paid additional fees from the Touchstone Institutional Money Market Fund that will not be waived or reimbursed.
A summary of each Fund’s investment, as applicable, in the Touchstone Institutional Money Market Fund for the six months ended December 31, 2012, is as follows:
Share Activity | ||||||||||||||||||||||||
Balance | Balance | Value | ||||||||||||||||||||||
06/30/12 | Purchases | Sales | 12/31/12 | Dividends | 12/31/12 | |||||||||||||||||||
Capital Growth Fund | 1,389,986 | 20,929,843 | (19,127,040 | ) | 3,192,789 | $ | 1,441 | $ | 3,192,789 | |||||||||||||||
International Small Cap Fund | 1,743,433 | 29,098,883 | (30,367,504 | ) | 474,812 | 1,197 | 474,812 | |||||||||||||||||
Mid Cap Value Opportunities Fund | 3,046,587 | 20,748,950 | (21,430,793 | ) | 2,364,744 | 2,719 | 2,364,744 | |||||||||||||||||
Small Cap Value Opportunities Fund | 2,600,391 | 19,372,420 | (19,901,386 | ) | 2,071,425 | 2,019 | 2,071,425 | |||||||||||||||||
U.S. Long/Short Fund | 159,830 | 2,377,449 | (2,537,272 | ) | 7 | 38 | 7 | |||||||||||||||||
Value Fund | 9,429,223 | 59,280,628 | (64,739,390 | ) | 3,970,461 | 2,175 | 3,970,461 |
5. Federal Tax Information
Federal income tax — It is each Fund’s policy to continue to comply with the special provisions of the Internal Revenue Code applicable to regulated investment companies. As provided therein, in any fiscal year in which a Fund so qualifies and distributes at least 90% of its investment company taxable income, the Fund (but not the shareholders) will be relieved of federal income tax on the income distributed. Accordingly, no provision for income taxes has been made.
In order to avoid imposition of the excise tax applicable to regulated investment companies, it is also each Fund’s intention to declare and pay as dividends in each calendar year at least 98% of its investment company taxable income (earned during the calendar year) and 98.2% of its net realized capital gains (earned during the twelve months ending October 31) plus undistributed amounts from prior years.
The tax character of distributions paid for the years ended June 30, 2012, March 31, 2012 and March 31, 2011 was as follows:
International | ||||||||||||||||||||||||
Capital Growth | Small Cap | |||||||||||||||||||||||
Fund | Fund | |||||||||||||||||||||||
Period Ended | Year Ended | Year Ended | Period Ended | Year Ended | Year Ended | |||||||||||||||||||
June 30, | March 31, | March 31, | June 30, | March 31, | March 31, | |||||||||||||||||||
2012 | 2012 | 2011 | 2012 | 2012 | 2011 | |||||||||||||||||||
From ordinary income | $ | 31,849 | $ | 215,362 | $ | 460,798 | $ | 802,324 | $ | 1,842,301 | $ | 189,300 | ||||||||||||
$ | 31,849 | $ | 215,362 | $ | 460,798 | $ | 802,324 | $ | 1,842,301 | $ | 189,300 |
Mid Cap Value | Small Cap Value | |||||||||||||||||||||||
Opportunities | Opportunities | |||||||||||||||||||||||
Fund | Fund | |||||||||||||||||||||||
Period Ended | Year Ended | Year Ended | Period Ended | Period Ended | Year Ended | |||||||||||||||||||
June 30, | March 31, | March 31, | June 30, | March 31, | March 31, | |||||||||||||||||||
2012 | 2012 | 2011 | 2012 | 2012 | 2011 | |||||||||||||||||||
From ordinary income | $ | 627,574 | $ | 2,171,072 | $ | 1,899,448 | $ | — | $ | — | $ | — | ||||||||||||
From long-term capital gains | 3,418,930 | 11,225,590 | — | 2,691,474 | 5,495,825 | — | ||||||||||||||||||
$ | 4,046,504 | $ | 13,396,662 | $ | 1,899,448 | $ | 2,691,474 | $ | 5,495,825 | $ | — |
60 |
Notes to Financial Statements (Continued)
U.S. Long/Short | Value | |||||||||||||||||||||||
Fund | Fund | |||||||||||||||||||||||
Period Ended | Year Ended | Year Ended | Period Ended | Year Ended | Year Ended | |||||||||||||||||||
June 30, | March 31, | March 31, | June 30, | March 31, | March 31, | |||||||||||||||||||
2012 | 2012 | 2011 | 2012 | 2012 | 2011 | |||||||||||||||||||
From ordinary income | $ | — | $ | 174,003 | $ | 1,435,069 | $ | 1,228,217 | $ | 2,287,808 | $ | 2,145,890 | ||||||||||||
$ | — | $ | 174,003 | $ | 1,435,069 | $ | 1,228,217 | $ | 2,287,808 | $ | 2,145,890 |
The following information is computed on a tax basis for each item as of June 30, 2012:
International | Mid Cap Value | |||||||||||
Capital | Small Cap | Opportunities | ||||||||||
Growth Fund | Fund | Fund | ||||||||||
Tax cost of portfolio investments | $ | 119,308,259 | $ | 88,430,245 | $ | 97,252,111 | ||||||
Gross unrealized appreciation | 52,337,517 | 4,891,983 | 11,932,198 | |||||||||
Gross unrealized depreciation | (4,668,647 | ) | (5,309,284 | ) | (4,204,577 | ) | ||||||
Net portfolio unrealized appreciation (depreciation) | 47,668,870 | (417,301 | ) | 7,727,621 | ||||||||
Net other unrealized appreciation (depreciation) | — | (6,224 | ) | — | ||||||||
Total net unrealized appreciation (depreciation) | 47,668,870 | (423,525 | ) | 7,727,621 | ||||||||
Accumulated capital and other losses | (42,978,321 | ) | (29,152,825 | ) | (6,598,290 | ) | ||||||
Undistributed Ordinary Income | 112,598 | 695,120 | 1,658,438 | |||||||||
Undistributed capital gains | — | — | 8,946,909 | |||||||||
Accumulated earnings (deficit) | $ | 4,803,147 | $ | (28,881,230 | ) | $ | 11,734,678 |
Small Cap Value | U.S. | |||||||||||
Opportunities | Long/Short | Value | ||||||||||
Fund | Fund | Fund | ||||||||||
Tax cost of portfolio investments | $ | 83,158,057 | $ | 11,410,132 | $ | 104,831,200 | ||||||
Gross unrealized appreciation | 19,203,092 | 2,883,332 | 30,944,442 | |||||||||
Gross unrealized depreciation | (4,434,407 | ) | (738,842 | ) | (5,545,079 | ) | ||||||
Net unrealized appreciation (depreciation) | 14,768,685 | 2,144,490 | 25,399,363 | |||||||||
Accumulated capital and other losses | (3,116,992 | ) | (62,645,090 | ) | (16,209,614 | ) | ||||||
Undistributed ordinary income | 715,088 | 30,656 | 24,961 | |||||||||
Undistributed capital gains | 4,255,709 | — | — | |||||||||
Accumulated earnings (deficit) | $ | 16,622,490 | $ | (60,469,944 | ) | $ | 9,214,710 |
The difference between the tax cost of portfolio investments and the financial statement cost is primarily due to wash sale loss deferrals and passive foreign investment company (“PFIC”) adjustments.
61 |
Notes to Financial Statements (Continued)
As of June 30, 2012, the Funds had the following capital loss carryforwards for federal income tax purposes:
No | No | |||||||||||||||||||||||||||
Expiration | Expiration | |||||||||||||||||||||||||||
2015 | 2016 | 2017 | 2018 | Short Term * | Long Term * | Total | ||||||||||||||||||||||
Capital Growth Fund ** | $ | 8,648,358 | $ | 19,833,889 | $ | 14,496,074 | $ | — | $ | — | $ | — | $ | 42,978,321 | ||||||||||||||
International Small Cap Fund ** | 10,436,336 | 4,523,327 | 4,884,304 | — | 8,711,422 | 597,436 | 29,152,825 | |||||||||||||||||||||
Mid Cap Value Opportunities Fund ** | — | — | 6,598,290 | — | — | — | 6,598,290 | |||||||||||||||||||||
Small Cap Value Opportunities Fund | 3,116,992 | — | — | — | — | — | 3,116,992 | |||||||||||||||||||||
U.S. Long/Short Fund | 1,646,478 | 19,657,724 | 41,340,888 | — | — | — | 62,645,090 | |||||||||||||||||||||
Value Fund | — | — | 12,709,067 | 3,500,547 | — | — | 16,209,614 |
*The Regulated Investment Company Modernization Act of 2010 (the “Act”) was enacted on December 22, 2010. The Act makes changes to several tax rules impacting the Funds. In general, the provisions of the Act has been in effect for the Funds’ since the fiscal year ending June 30, 2012. Although the Act provides several benefits, including the unlimited carryover of future capital losses, there may be a greater likelihood that all or a portion of each Fund’s pre-enactment capital loss carryovers may expire without being utilized due to the fact that post-enactment capital losses must be utilized before pre-enactment capital loss carryovers may be utilized. Under the Act, new capital losses may now be carried forward indefinitely, and retain the character of the original loss as compared with pre-enactment law, where capital losses could be carried forward for up to eight years, and carried forward as short-term capital losses, irrespective of the character of the original loss.
**May be subject to usage limitations.
The capital loss carryforwards may be utilized in future years to offset net realized capital gains, if any, prior to distributing such gains to shareholders.
As of December 31, 2012, the federal tax cost and unrealized appreciation (depreciation) was as follows for the funds:
Net | ||||||||||||||||
Gross | Gross | Unrealized | ||||||||||||||
Federal Tax | Unrealized | Unrealized | Appreciation | |||||||||||||
Fund | Cost | Appreciation | Depreciation | (Depreciation) | ||||||||||||
Capital Growth Fund | $ | 118,595,520 | $ | 50,364,266 | $ | (1,189,465 | ) | $ | 49,174,801 | |||||||
International Small Cap Fund | 92,432,029 | 14,305,015 | (1,908,767 | ) | 12,396,248 | |||||||||||
Mid Cap Value Opportunities Fund | 86,956,686 | 13,711,535 | (2,242,238 | ) | 11,469,297 | |||||||||||
Small Cap Value Opportunities Fund | 94,444,689 | 11,734,935 | (2,865,464 | ) | 8,869,471 | |||||||||||
U.S Long/Short Fund | 13,084,283 | 1,706,332 | (182,811 | ) | 1,523,521 | |||||||||||
Value Fund | 273,858,086 | 35,814,752 | (3,176,878 | ) | 32,637,874 |
The Funds have analyzed their tax positions taken on Federal income tax returns for all open tax years (tax years ended June 30, 2012 and March 31, 2008 through 2012) and have concluded that no provision for income tax is required in their financial statements.
6. Commitments and Contingencies
The Funds indemnify the Trust’s officers and Trustees for certain liabilities that might arise from their performance of their duties to the Funds. Additionally, in the normal course of business, the Funds enter into contracts that contain a variety of representations and warranties and which provide general indemnifications. The Funds’ maximum exposure under these arrangements is unknown, as this would involve future claims that may be made against the Funds that have not yet occurred. However, based on experience, the Funds expect the risk of loss to be remote.
62 |
Notes to Financial Statements (Continued)
7. Risks Associated with Foreign Investments
Some of the Funds may invest in the securities of foreign issuers. Investing in securities issued by companies whose principal business activities are outside the U.S. may involve significant risks not present in domestic investments. For example, there is generally less publicly available information about foreign companies, particularly those not subject to the disclosure and reporting requirements of the U.S. securities laws. Foreign issuers are generally not bound by uniform accounting, auditing, and financial reporting requirements and standards of practice comparable to those applicable to domestic issuers. Investments in foreign securities also involve the risk of possible adverse changes in investment or exchange control regulations, expropriation or confiscatory taxation, limitations on the removal of funds or other assets of the Fund, political or financial instability or diplomatic and other developments which could affect such investments. Foreign stock markets, while growing in volume and sophistication, are generally not as developed as those in the U.S., and securities of some foreign issuers (particularly those located in developing countries) may be less liquid and more volatile than securities of comparable U.S. companies. In general, there is less overall governmental supervision and regulation of foreign securities markets, broker-dealers, and issuers than in the U.S.
8. Risks Associated with Leverage
By investing the proceeds received from selling securities short, the U.S. Long/Short Fund is employing leverage, which creates special risks. The use of leverage may increase the Fund’s exposure to long or short equity positions and may cause the Fund’s net asset value to be more volatile than if the Fund had not used leverage. This could result in increased volatility of returns.
9. Fund Mergers
On February 10, 2012, the shareholders of the Old Mutual Funds II (the “Reorganizing Funds”), with the exception of the Old Mutual Large Cap Growth Fund, approved an Agreement and Plan of Reorganization (the “Plan”) providing for the transfer of all assets and liabilities of each Reorganizing Fund to the corresponding Touchstone Fund as noted below. The Old Mutual Large Cap Growth Fund shareholders approved the Plan on March 9, 2012. The mergers took place on April 13, 2012. The fiscal year end of the Reorganizing Funds was March 31. After the merger, the Funds year end changed to June 30.
Net | Shares | |||||||||
Reorganizing Funds* | Touchstone Funds | Assets | Outstanding | |||||||
Old Mutual Large Cap Growth Fund | Capital Growth Fund | $ | 193,000,739 | 9,458,968 | ||||||
Old Mutual Copper Rock International Small Cap Fund | International Small Cap Fund | 94,539,664 | 8,488,001 | |||||||
Old Mutual TS&W Mid Cap Value Fund | Mid Cap Value Opportunities Fund | 163,004,026 | 18,535,707 | |||||||
Old Mutual TS&W Small Cap Value Fund | Small Cap Value Opportunities Fund | 105,855,279 | 5,843,115 | |||||||
Old Mutual Analytic U.S. Long/Short Fund | U.S. Long/Short Fund | 21,638,731 | 1,722,142 | |||||||
Old Mutual Barrow Hanley Value Fund | Value Fund | 118,385,619 | 17,118,623 |
* | Funds had Class Z shares outstanding immediately prior to the reorganization, which were exchanged for Class Y Shares of the corresponding Touchstone Fund. |
At a meeting held on March 13, 2012, the Board of Trustees of the Trust approved an Agreement and Plans of Reorganization (the “Plans”) providing for the transfer of all assets and liabilities of the Fifth Third Disciplined Large Cap Value Fund and the Fifth Third All Cap Value Fund (each an “Acquired Fund”), each a series of the Fifth Third Funds (“Fifth Third”), to the Touchstone Value Fund (the “Acquiring Fund”). The mergers took place on September 10, 2012.
63 |
Notes to Financial Statements (Continued)
The following is a summary of shares outstanding, net assets, net asset value per share and unrealized appreciation immediately before and after the reorganization:
After | ||||||||||||||||
Before Reorganization | Reorganization | |||||||||||||||
Fifth Third | ||||||||||||||||
Disciplined | Fifth Third | Touchstone | Touchstone | |||||||||||||
Large Cap | All Cap | Value | Value | |||||||||||||
Value Fund | Value Fund | Fund | Fund | |||||||||||||
Class A * | ||||||||||||||||
Shares | 1,419,797 | (A) | 3,514,789 | (B) | 245,017 | 5,179,603 | ||||||||||
Net Assets | $ | 10,274,502 | $ | 25,435,080 | $ | 1,773,081 | $ | 37,482,663 | ||||||||
Net Asset Value | $ | 7.24 | (A) | $ | 7.24 | (B) | $ | 7.24 | $ | 7.24 | ||||||
Class C | ||||||||||||||||
Shares | 39,232 | (C) | 341,354 | (D) | 366 | 380,953 | ||||||||||
Net Assets | $ | 283,871 | $ | 2,469,899 | $ | 2,651 | $ | 2,756,421 | ||||||||
Net Asset Value | $ | 7.24 | (C) | $ | 7.24 | (D) | $ | 7.24 | $ | 7.24 | ||||||
Class Y * | ||||||||||||||||
Shares | 20,691,815 | (E) | 5,255,988 | (F) | 6,754,404 | 32,702,207 | ||||||||||
Net Assets | $ | 150,150,006 | $ | 38,140,140 | $ | 49,013,423 | $ | 237,303,569 | ||||||||
Net Asset Value | $ | 7.26 | (E) | $ | 7.26 | (F) | $ | 7.26 | $ | 7.26 | ||||||
Institutional Class | ||||||||||||||||
Shares | — | — | 10,340,227 | 10,340,227 | ||||||||||||
Net Assets | $ | — | $ | — | $ | 74,892,668 | $ | 74,892,668 | ||||||||
Net Asset Value | $ | — | $ | — | $ | 7.24 | $ | 7.24 | ||||||||
Fund Total | ||||||||||||||||
Shares Outstanding | 13,906,702 | 3,991,534 | 17,340,014 | 48,602,989 | ||||||||||||
Net Assets | $ | 160,708,379 | $ | 66,045,119 | $ | 125,681,823 | $ | 352,435,321 | ||||||||
Unrealized Depreciation | $ | (13,753,975 | ) | $ | (7,038,724 | ) | $ | (28,894,804 | ) | $ | (49,687,503 | ) |
(A)Reflects a 1.5919:1 reverse stock split on Class A Shares and a 1.6123:1 reverse stock split on Class B Shares which occurred on the date of reorganization, September 10, 2012.
(B)Reflects a 2.2762:1 reverse stock split on Class A Shares and a 2.1413:1 reverse stock split on Class B Shares which occurred on the date of reorganization, September 10, 2012.
(C)Reflects a 1.5725:1 reverse stock split which occurred on the date of reorganization, September 10, 2012.
(D)Reflects a 2.1338:1 reverse stock split which occurred on the date of reorganization, September 10, 2012.
(E)Reflects a 1.5929:1 reverse stock split which occurred on the date of reorganization, September 10, 2012.
(F)Reflects a 2.3023:1 reverse stock split which occurred on the date of reorganization, September 10, 2012.
*The Acquired Funds had Class B shares outstanding immediately prior to the reorganization, which were exchanged for Class A shares of the Acquiring Fund.
Assuming the reorganization had been completed on July 1, 2012, the results of operations for the Value Fund for the six months ended December 31, 2012 would have been as follows:
Touchstone | ||||
Value | ||||
Fund | ||||
Net investment income | $ | 3,590,036 | ||
Net realized and unrealized gain on investments | $ | 44,429,565 | ||
Net increase in asset from operations | $ | 48,019,601 |
64 |
Notes to Financial Statements (Continued)
10. Litigation
In January 2012, the Old Mutual Mid-Cap Fund (which reorganized into the TS&W Mid-Cap Value Fund in March 2009 and reorganized into the Touchstone Mid Cap Value Opportunities Fund in April 2012) was served with a summons and complaint in an action brought by Edward S. Weisfelner, as Trustee of the LB Creditor Trust, in the case captioned Weisfelner v. Fund 1, et al. (U.S. Bankruptcy Court, Southern District of New York, Adv. Pro No. 10-4609) (the “Action”). The Action seeks to recover all payments made to shareholders in the December 2007 leveraged buyout of Lyondell Chemical Company as alleged fraudulent transfers, by means of intentional and constructive fraudulent transfer causes of action under state law. The amount sought to be disgorged is what the Fund received in payments in connection with the leveraged buyout, $3,784,800. The Fund (along with thousands of other defendants) has filed a joinder to the currently pending motion to dismiss and awaits the court’s ruling on that motion. The path the litigation will follow (including whether it will proceed at all) depends on the outcome of that ruling; it is uncertain when that ruling will come down, however. At this nascent stage of the litigation, it is not possible to assess likely outcome. The Fund is currently assessing the case and has not yet determined the potential effect, if any, on its net asset value.
11. Subsequent Events
Subsequent events occurring after the date of this report have been evaluated for potential impact to this report through the date the financial statements were issued.
At a meeting of the Board of Trustees (the “Board”) of Touchstone Strategic Trust held on February 21, 2013, the Board approved a plan to close and liquidate the Touchstone U.S. Long/Short Fund (the “Liquidation Fund”). The Liquidation Fund will be closed and liquidated on or about March 26, 2013.
There were no other subsequent events that necessitated recognition or disclosure on the Funds’ financial statements.
65 |
Other Items
Proxy Voting Guidelines
The Sub-Advisors are responsible for exercising the voting rights associated with the securities purchased and held by the Funds. A description of the policies and procedures that the Sub-Advisors use in fulfilling this responsibility and information regarding how those proxies were voted during the twelve month period ended June 30 are available as an exhibit to the most recent Statement of Additional Information or without charge by calling toll free 1.800.543.0407. These items are also available on the Securities and Exchange Commission’s (the Commission) website at http://www.sec.gov.
Quarterly Portfolio Disclosure
The Trust files a complete listing of portfolio holdings for each Fund as of the end of the first and third quarters of each fiscal year on Form N-Q. The complete listing (i) is available on the Commission’s website; (ii) may be reviewed and copied at the Commission’s Public Reference Room in Washington, DC; and (iii) will be made available to shareholders upon request by calling 1.800.543.0407. Information on the operation of the Public Reference Room may be obtained by calling 1.800.SEC.0330.
Schedule of Shareholder Expenses
As a shareholder of the Funds, you incur two types of costs: (1) transaction costs, including reinvested dividends or other distributions; and (2) ongoing costs, including investment advisory fees; distribution (12b-1) fees; and other Fund expenses. This example is intended to help you understand your ongoing costs (in dollars) of investing in the Funds and to compare these costs with the ongoing costs of investing in other mutual funds.
The example is based on an investment of $1,000 invested at the beginning of the period and held for the entire period July 1, 2012 through December 31, 2012.
Actual Expenses
The first line for each share class of a Fund in the table below provides information about actual account values and actual expenses. You may use the information in this line, together with the amount you invested, to estimate the expenses that you paid over the period. Simply divide your account value by $1,000 (for example, an $8,600 account value divided by $1,000 = 8.6), then multiply the result by the number in the first line under the heading entitled “Expenses Paid During the six months ended December 31, 2012” to estimate the expenses you paid on your account during this period.
Hypothetical Example for Comparison Purposes
The second line for each share class of a Fund in the table below provides information about hypothetical account values and hypothetical expenses based on the Funds’ actual expense ratio and an assumed rate of return of 5% per year before expenses, which is not the Funds’ actual return. The hypothetical account values and expenses may not be used to estimate the actual ending account balance or expenses you paid for the period. You may use this information to compare the ongoing costs of investing in the Funds and other funds. To do so, compare this 5% hypothetical example with the 5% hypothetical examples that appear in the shareholder reports of the other funds.
66 |
Other Items (Continued)
Schedule of Shareholder Expenses (Continued)
Expenses | ||||||||||||||||||||
Net Expense | Beginning | Ending | Paid During | |||||||||||||||||
Ratio | Account | Account | the Six Months | |||||||||||||||||
Annualized | Value | Value | Ended | |||||||||||||||||
December 31, | July 1, | December 31, | December 31, | |||||||||||||||||
2012 | 2012 | 2012 | 2012* | |||||||||||||||||
Touchstone Capital Growth Fund | ||||||||||||||||||||
Class A | Actual | 1.25 | % | $ | 1,000.00 | $ | 1,074.40 | $ | 6.54 | |||||||||||
Class A | Hypothetical | 1.25 | % | $ | 1,000.00 | $ | 1,018.90 | $ | 6.36 | |||||||||||
Class C | Actual | 2.00 | % | $ | 1,000.00 | $ | 1,070.30 | $ | 10.44 | |||||||||||
Class C | Hypothetical | 2.00 | % | $ | 1,000.00 | $ | 1,015.12 | $ | 10.16 | |||||||||||
Class Y | Actual | 1.00 | % | $ | 1,000.00 | $ | 1,075.60 | $ | 5.23 | |||||||||||
Class Y | Hypothetical | 1.00 | % | $ | 1,000.00 | $ | 1,020.16 | $ | 5.09 | |||||||||||
Institutional Class | Actual | 0.90 | % | $ | 1,000.00 | $ | 1,076.00 | $ | 4.71 | |||||||||||
Institutional Class | Hypothetical | 0.90 | % | $ | 1,000.00 | $ | 1,020.67 | $ | 4.58 | |||||||||||
Touchstone International Small Cap Fund | ||||||||||||||||||||
Class A | Actual | 1.55 | % | $ | 1,000.00 | $ | 1,157.50 | $ | 8.43 | |||||||||||
Class A | Hypothetical | 1.55 | % | $ | 1,000.00 | $ | 1,017.39 | $ | 7.88 | |||||||||||
Class C | Actual | 2.30 | % | $ | 1,000.00 | $ | 1,152.70 | $ | 12.48 | |||||||||||
Class C | Hypothetical | 2.30 | % | $ | 1,000.00 | $ | 1,013.61 | $ | 11.67 | |||||||||||
Class Y | Actual | 1.30 | % | $ | 1,000.00 | $ | 1,158.20 | $ | 7.07 | |||||||||||
Class Y | Hypothetical | 1.30 | % | $ | 1,000.00 | $ | 1,018.65 | $ | 6.61 | |||||||||||
Institutional Class | Actual | 1.05 | % | $ | 1,000.00 | $ | 1,159.50 | $ | 5.72 | |||||||||||
Institutional Class | Hypothetical | 1.05 | % | $ | 1,000.00 | $ | 1,019.91 | $ | 5.35 | |||||||||||
Touchstone Mid Cap Value Opportunities Fund | ||||||||||||||||||||
Class A | Actual | 1.29 | % | $ | 1,000.00 | $ | 1,075.40 | $ | 6.75 | |||||||||||
Class A | Hypothetical | 1.29 | % | $ | 1,000.00 | $ | 1,018.70 | $ | 6.56 | |||||||||||
Class C | Actual | 2.04 | % | $ | 1,000.00 | $ | 1,071.50 | $ | 10.65 | |||||||||||
Class C | Hypothetical | 2.04 | % | $ | 1,000.00 | $ | 1,014.92 | $ | 10.36 | |||||||||||
Class Y | Actual | 1.04 | % | $ | 1,000.00 | $ | 1,075.90 | $ | 5.44 | |||||||||||
Class Y | Hypothetical | 1.04 | % | $ | 1,000.00 | $ | 1,019.96 | $ | 5.30 | |||||||||||
Institutional Class | Actual | 0.89 | % | $ | 1,000.00 | $ | 1,076.90 | $ | 4.66 | |||||||||||
Institutional Class | Hypothetical | 0.89 | % | $ | 1,000.00 | $ | 1,020.72 | $ | 4.53 |
67 |
Other Items (Continued)
Schedule of Shareholder Expenses (Continued)
Expenses | ||||||||||||||||||||
Net Expense | Beginning | Ending | Paid During | |||||||||||||||||
Ratio | Account | Account | the Six Months | |||||||||||||||||
Annualized | Value | Value | Ended | |||||||||||||||||
December 31, | July 1, | December 31, | December 31, | |||||||||||||||||
2012 | 2012 | 2012 | 2012* | |||||||||||||||||
Touchstone Small Cap Value Opportunities Fund | ||||||||||||||||||||
Class A | Actual | 1.50 | % | $ | 1,000.00 | $ | 1,067.40 | $ | 7.82 | |||||||||||
Class A | Hypothetical | 1.50 | % | $ | 1,000.00 | $ | 1,017.64 | $ | 7.63 | |||||||||||
Class C | Actual | 2.25 | % | $ | 1,000.00 | $ | 1,063.90 | $ | 11.70 | |||||||||||
Class C | Hypothetical | 2.25 | % | $ | 1,000.00 | $ | 1,013.86 | $ | 11.42 | |||||||||||
Class Y | Actual | 1.20 | % | $ | 1,000.00 | $ | 1,069.20 | $ | 6.26 | |||||||||||
Class Y | Hypothetical | 1.20 | % | $ | 1,000.00 | $ | 1,019.16 | $ | 6.11 | |||||||||||
Institutional Class | Actual | 1.10 | % | $ | 1,000.00 | $ | 1,069.40 | $ | 5.74 | |||||||||||
Institutional Class | Hypothetical | 1.10 | % | $ | 1,000.00 | $ | 1,019.66 | $ | 5.60 | |||||||||||
Touchstone U.S. Long/Short Fund | ||||||||||||||||||||
Class A | Actual | 1.30 | % | $ | 1,000.00 | $ | 1,038.40 | $ | 6.68 | ** | ||||||||||
Class A | Hypothetical | 1.30 | % | $ | 1,000.00 | $ | 1,018.65 | $ | 6.61 | |||||||||||
Class C | Actual | 2.05 | % | $ | 1,000.00 | $ | 1,034.80 | $ | 10.51 | ** | ||||||||||
Class C | Hypothetical | 2.05 | % | $ | 1,000.00 | $ | 1,014.87 | $ | 10.41 | |||||||||||
Class Y | Actual | 1.05 | % | $ | 1,000.00 | $ | 1,040.60 | $ | 5.40 | ** | ||||||||||
Class Y | Hypothetical | 1.05 | % | $ | 1,000.00 | $ | 1,019.91 | $ | 5.35 | |||||||||||
Institutional Class | Actual | 0.90 | % | $ | 1,000.00 | $ | 1,040.90 | $ | 4.63 | ** | ||||||||||
Institutional Class | Hypothetical | 0.90 | % | $ | 1,000.00 | $ | 1,020.67 | $ | 4.58 | |||||||||||
Touchstone Value Fund | ||||||||||||||||||||
Class A | Actual | 1.08 | % | $ | 1,000.00 | $ | 1,054.70 | $ | 5.59 | |||||||||||
Class A | Hypothetical | 1.08 | % | $ | 1,000.00 | $ | 1,019.76 | $ | 5.50 | |||||||||||
Class C | Actual | 1.83 | % | $ | 1,000.00 | $ | 1,050.40 | $ | 9.46 | |||||||||||
Class C | Hypothetical | 1.83 | % | $ | 1,000.00 | $ | 1,015.98 | $ | 9.30 | |||||||||||
Class Y | Actual | 0.83 | % | $ | 1,000.00 | $ | 1,055.70 | $ | 4.30 | |||||||||||
Class Y | Hypothetical | 0.83 | % | $ | 1,000.00 | $ | 1,021.02 | $ | 4.23 | |||||||||||
Institutional Class | Actual | 0.73 | % | $ | 1,000.00 | $ | 1,056.30 | $ | 3.78 | |||||||||||
Institutional Class | Hypothetical | 0.73 | % | $ | 1,000.00 | $ | 1,021.53 | $ | 3.72 |
* | Expenses are equal to the Fund's annualized expense ratio, multiplied by the average account value over the period, multiplied by [184/365] (to reflect the one-half year period). |
** | Excluding interest and dividend expenses on securities sold short, your actual cost of investment in Class A, Class C, Class Y and Institutional Class would be $8.48, $12.31, $7.20 and $6.43, respectively. |
68 |
PRIVACY PROTECTION POLICY
We Respect Your Privacy
Thank you for your decision to invest with us. Touchstone and its affiliates have always placed a high value on the trust and confidence our clients place in us. We believe that confidence must be earned and validated through time. In today’s world, when technology allows the sharing of information at light speeds, trust must be reinforced by our sincere pledge to take the steps necessary to ensure that the information you share with us is treated with respect and confidentiality.
Our Pledge to Our Clients
· | We collect only the information we need to service your account and administer our business. |
· | We are committed to keeping your information confidential and we place strict limits and controls on the use and sharing of your information. |
· | We make every effort to ensure the accuracy of your information. |
We Collect the Following Nonpublic Personal Information About You:
· | Information we receive from you on or in applications or other forms, correspondence, or conversations, including, but not limited to, your name, address, phone number, social security number, assets, income and date of birth; and |
· | Information about your transactions with us, our affiliates, or others, including, but not limited to, your account number and balance, payment history, parties to transactions, cost basis information, and other financial information. |
Categories of Information We Disclose and Parties to Whom We Disclose
We do not disclose any nonpublic personal information about our current or former clients to nonaffiliated third parties, except as required or permitted by law.
We Place Strict Limits and Controls on the Use and Sharing of Your Information
· | We restrict access to nonpublic personal information about you to authorized employees who need the information to administer your business. |
· | We maintain physical, electronic and procedural safeguards that comply with federal standards to protect this information. |
· | We do not disclose any nonpublic personal information about our current or former clients to anyone, except as required or permitted by law or as described in this document. |
· | We will not sell your personal information to anyone. |
We May Provide Information to Service Your Account
Sometimes it is necessary to provide information about you to various companies such as transfer agents, custodians, broker-dealers and marketing service firms to facilitate the servicing of your account. These organizations have a legitimate business need to see some of your personal information in order for us to provide service to you. We may disclose to these various companies the information that we collect as described above. We require that these companies, including our own subsidiaries and affiliates, strictly maintain the confidentiality of this information and abide by all applicable laws. Companies within our corporate family that may receive this information are financial service providers and insurance companies. We do not permit these associated companies to sell the information for their own purposes, and we never sell our customer information.
This policy is applicable to the following affiliated companies: Touchstone Funds Group Trust, Touchstone Investment Trust, Touchstone Strategic Trust, Touchstone Tax-Free Trust, Touchstone Variable Series Trust, Touchstone Institutional Funds Trust, Touchstone Securities, Inc.,* and W&S Brokerage Services, Inc.
* Touchstone Securities, Inc. serves as the underwriter to the Touchstone Funds.
A Member of Western & Southern Financial Group®
The Privacy Protection Policy is not part of the Semi-Annual Report.
69 |
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Touchstone Investments
Distributor
Touchstone Securities, Inc.*
303 Broadway
Cincinnati, Ohio 45202-4203 800.638.8194
www.touchstoneinvestments.com
Investment Advisor
Touchstone Advisors, Inc.*
303 Broadway
Cincinnati, Ohio 45202-4203
Transfer Agent
BNY Mellon Investment Servicing (US) Inc.
4400 Computer Drive
Westborough, MA 01581
Shareholder Service
800.543.0407
* A Member of Western & Southern Financial Group
TSF-54BB-TST-SAR-1212
Item 2. Code of Ethics.
Not applicable.
Item 3. Audit Committee Financial Expert.
Not applicable.
Item 4. Principal Accountant Fees and Services.
Not applicable.
Item 5. Audit Committee of Listed registrants.
Not applicable.
Item 6. Investments.
(a) | Schedule of Investments in securities of unaffiliated issuers as of the close of the reporting period is included as part of the report to shareholders filed under Item 1 of this form. |
(b) | Not applicable. |
Item 7. Disclosure of Proxy Voting Policies and Procedures for Closed-End Management Investment Companies.
Not applicable.
Item 8. Portfolio Managers of Closed-End Management Investment Companies.
Not applicable.
Item 9. Purchases of Equity Securities by Closed-End Management Investment Company and Affiliated Purchasers.
Not applicable.
Item 10. Submission of Matters to a Vote of Security Holders.
There have been no material changes to the procedures by which the shareholders may recommend nominees to the registrant’s board of trustees, where those changes were implemented after the registrant last provided disclosure in response to the requirements of Item 407(c)(2)(iv) of Regulation S-K (17 CFR 229.407) (as required by Item 22(b)(15) of Schedule 14A (17 CFR 240.14a-101)), or this Item.
Item 11. Controls and Procedures.
(a) | The registrant’s principal executive and principal financial officers, or persons performing similar functions, have concluded that the registrant’s disclosure controls and procedures (as defined in Rule 30a-3(c) under the Investment Company Act of 1940, as amended (the “1940 Act”) (17 CFR 270.30a-3(c))) are effective, as of a date within 90 days of the filing date of the report that includes the disclosure required by this paragraph, based on their evaluation of these controls and procedures required by Rule 30a-3(b) under the 1940 Act (17 CFR 270.30a-3(b)) and Rules 13a-15(b) or 15d-15(b) under the Securities Exchange Act of 1934, as amended (17 CFR 240.13a-15(b) or 240.15d-15(b)). |
(b) | There were no changes in the registrant’s internal control over financial reporting (as defined in Rule 30a-3(d) under the 1940 Act (17 CFR 270.30a-3(d)) that occurred during the registrant’s second fiscal quarter of the period covered by this report that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting. |
Item 12. Exhibits.
(a)(1) | Not applicable. |
(a)(2) | Certifications pursuant to Rule 30a-2(a) under the 1940 Act and Section 302 of the Sarbanes-Oxley Act of 2002 are attached hereto. |
(a)(3) | Not applicable. |
(b) | Certifications pursuant to Rule 30a-2(b) under the 1940 Act and Section 906 of the Sarbanes-Oxley Act of 2002 are attached hereto. |
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment Company Act of 1940, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.
(Registrant) | Touchstone Strategic Trust |
By (Signature and Title)* | /s/ Jill T. McGruder | |
Jill T. McGruder, President | ||
(principal executive officer) |
Date | 02/27/13 |
Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment Company Act of 1940, this report has been signed below by the following persons on behalf of the registrant and in the capacities and on the dates indicated.
By (Signature and Title)* | /s/ Jill T. McGruder | |
Jill T. McGruder, President | ||
(principal executive officer) |
Date | 02/27/13 |
By (Signature and Title)* | /s/ Terrie A. Wiedenheft | |
Terrie A. Wiedenheft, Controller and Treasurer | ||
(principal financial officer) |
Date | 02/27/13 |
* Print the name and title of each signing officer under his or her signature.