| 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 811-3967 |
FIRST INVESTORS INCOME FUNDS
(Exact name of registrant as specified in charter)
40 Wall Street
New York, NY 10005
(Address of principal executive offices) (Zip code)
Joseph I. Benedek
Foresters Investment Management Company, Inc.
Raritan Plaza I
Edison, NJ 08837-3620
(Name and address of agent for service)
REGISTRANT'S TELEPHONE NUMBER, INCLUDING AREA CODE:
1-212-858-8000
DATE OF FISCAL YEAR END: SEPTEMBER 30
DATE OF REPORTING PERIOD: MARCH 31, 2017
Item 1. Reports to Stockholders
| The semi-annual report to stockholders follows |
| FOREWORD |
This report is for the information of the shareholders of the Funds. It is the policy of each Fund described in this report to mail only one copy of a Fund’s prospectus, annual report, semi-annual report and proxy statements to all shareholders who share the same mailing address and share the same last name and have invested in a Fund covered by the same document. You are deemed to consent to this policy unless you specifically revoke this policy and request that separate copies of such documents be mailed to you. In such case, you will begin to receive your own copies within 30 days after our receipt of the revocation. You may request that separate copies of these disclosure documents be mailed to you by writing to us at: Foresters Investor Services, Inc., Raritan Plaza I, Edison, NJ 08837-3620 or calling us at 1-800-423-4026.
You may obtain a free prospectus for any of the Funds by contacting your representative, calling 1-800-423-4026, writing to us at the following address: Foresters Financial Services, Inc., 40 Wall Street, New York, NY 10005, or by visiting our website at www.foresters.com. You should consider the investment objectives, risks, charges and expenses of a Fund carefully before investing. The prospectus contains this and other information about the Fund, and should be read carefully before investing.
An investment in a Fund is not a bank deposit and is not insured or guaranteed by the Federal Deposit Insurance Corporation (FDIC) or any other government agency. Although the Government Cash Management Fund* seeks to preserve a net asset value at $1.00 per share, it is possible to lose money by investing in it, just as it is possible to lose money by investing in any of the other Funds. Past performance is no guarantee of future results. There is no guarantee that a Fund’s investment objective will be achieved.
A Statement of Additional Information (“SAI”) for any of the Funds may also be obtained, without charge, upon request by calling 1-800-423-4026, writing to us at our address or by visiting our website listed above. The SAI contains more detailed information about the Funds, including information about its Trustees.
* Effective October 3, 2016, the Cash Management Fund changed its name to the Government Cash Management Fund.
Foresters FinancialTM and ForestersTM are the trade names and trademarks of The Independent Order of Foresters (Foresters), a fraternal benefit society, 789 Don Mills Road, Toronto, Canada M3C 1T9 and its subsidiaries.
Market Overview
FIRST INVESTORS INCOME FUNDS
FIRST INVESTORS EQUITY FUNDS
Dear Investor:
We are pleased to provide you with our report for the six-month period ended March 31, 2017.
Market and Economic Overview
One of the largest impacts on the markets during the review period was the U.S. presidential election. The beginning of the period was dominated by risk-off sentiment ahead of the election. Donald Trump’s unexpected win resulted in a strong rally in U.S. equity markets, dollar appreciation, and a substantial rise in interest rates. In this rally, investors turned to investments that would benefit from Trump’s pro-growth agenda, such as tax reform, increased public spending and regulatory reforms. Toward the end of the review period, the post-election optimism paused as markets started to question the new administration’s ability to deliver on its agenda.
Another dominant factor that influenced markets was both the anticipation and actual timing of the Federal Reserve’s (“the Fed’s”) interest rate hikes. The Fed increased its target rate in December 2016 and March 2017, following the December 2015 hike when it started its path toward interest rate normalization. Reflecting increased optimism regarding the U.S. economy, the Fed is considering two additional hikes this year. The Labor Market Conditions Index, which tracks changes in the labor market, has been on the rise and the unemployment rate has fallen below 5%, both of which are signs of an improving economy. Inflation has been climbing steadily since July of 2016, and has moved towards the Fed’s target of 2%.
There have been additional signs of an improving U.S. and global economic outlook. The U.S. economy grew at an annualized rate of 2.1% during the fourth quarter of 2016, stronger than the previous estimate of 1.9%. U.S. consumers and businesses are significantly more positive regarding their outlook than they were at this time last year. U.S. consumer confidence is at a 17-year high. In Europe, business surveys have risen to their highest levels in over five years and consumer confidence has also recovered. There are also signs of improvement in emerging market growth.
Bond Markets
Most of the fixed income markets had negative performances during the review period. The U.S. bond market (measured by the BofA Merrill Lynch U.S. Broad Market Index) lost 2.23%. The market lost 3.08% in the fourth quarter, which was the worst quarterly loss in more than 20 years, as interest rates moved sharply higher in reaction to Trump’s victory.
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Market Overview (continued)
FIRST INVESTORS INCOME FUNDS
FIRST INVESTORS EQUITY FUNDS
Treasury yields rose across all maturities during the review period. The 2-year Treasury yield, which is very sensitive to changes in Fed policy, rose 50 basis points from 0.76% to 1.26%. The benchmark 10-year Treasury yield rose 79 basis points from 1.60% to 2.39%. The Fed increased interest rates twice during this period, in mid-December and mid-March. Yields moved up ahead of these widely anticipated interest rate hikes, only to fall slightly later.
Despite recovering in the first quarter, Treasuries (measured by the BofA ML US Treasury Index) were the weakest domestic fixed income market during the review period, down 3.30%. Trump’s victory resulted in a massive sell-off of government bonds as investors reassessed the impact of the new administration on inflation and economic growth. Longer-dated Treasuries (15+ Years) had the worst performance at –10.45% while shorter-dated Treasuries (1–5 Year) held up better at –0.72%.
Investment grade corporate bonds (measured by the BofA ML Corporate Master Index) held up better than Treasuries, down 1.50% for the period under review, as tighter spreads offset some of the negative impact of rising interest rates. The sector continued to benefit from strong foreign demand due to its relatively attractive yields.
High yield bonds (measured by the BofA ML HY Cash Pay Constrained Index) and leveraged loans (measured by the Credit Suisse Leveraged Loan Index) were the best performing bond market sectors, gaining 4.61% and 3.48%, respectively. High yield bonds benefited from investors searching for income and the generally positive performance of riskier assets. The lowest quality bonds (CCC-rated) within high yield continued to outperform, returning 11.04%. Leveraged loans benefited from investors looking for bond investments that would perform well in a rising interest rate environment.
Many international fixed income markets underperformed U.S. fixed income markets, experiencing additional stress due to an appreciating U.S. dollar. Non-U.S. sovereign bonds (measured by the Citigroup World Government Bond ex-U.S., USD) lost 9.03%. Emerging market bonds (measured by the BofA ML Global Emerging Markets Sovereign, USD) performed better with a return of 0.35%. Emerging markets bond funds recovered during the first quarter, receiving about $20 billion of net flows as initial fears about U.S. post-election protectionism subsided. Money market rates increased 0.5% as a result of the Fed’s two interest rate increases during the review period.
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Equity Markets
U.S. equities posted double-digit returns for the review period. The S&P 500 Index and the Dow Jones Industrial Average (DJIA) gained 10.12% and 14.30%, respectively. Many equity indices reached new record heights. For example, the DJIA hit three major psychological milestones of 19,000 (on November 22nd), 20,000 (on January 25th) and 21,000 (on March 1st).
Equity market volatility was very low for most of this time period with the only spike occurring after the U.S. election. The VIX Index, which measures equity market volatility, posted its second lowest quarterly average on record during the first quarter.
Equities began October with losses as investors became risk averse ahead of the U.S. presidential election in November, and in anticipation of potential tighter monetary policy around the globe. The Trump victory resulted in a rally of risky assets. The equity rally continued through February. However, there was a rotation of market leaders during the first quarter of 2017 as the rally was driven primarily by an improving economic outlook while the “Trump” trade faded. Small-caps, Financials, Industrials and Value stocks had the best performance during the post-election rally, while Technology and Growth stocks came into favor during the first quarter.
Overall, mid-cap stocks (measured by the S&P Midcap 400 Index) and small-cap stocks (measured by the Russell 2000 Index) posted similar returns to large-cap stocks, returning 11.65% and 11.52%, respectively, for the period. However, the major drivers of these returns and their trajectories differed. Small-cap stocks were the largest beneficiaries of the post-election rally, returning 11.15% in November, while large-cap stocks lagged at 3.70%. However, in the first quarter of 2017, large-cap stocks had the best return of 6.07% while small-cap stocks gained only 1.06%, on the belief that any new trade restrictions would not be as harsh as previously thought.
Ten of the S&P 500 Index’s 11 sectors were positive. Financials, which was one of the biggest beneficiaries of Trump’s victory and higher interest rates, was the strongest sector, returning 24.16% for the period. The majority of this return occurred in the fourth quarter of 2016. Technology, which benefits most from improved economic growth, was the second strongest sector, returning 13.92%. The majority of this return happened in the first quarter of 2017. Real Estate was the weakest sector, down 1.02%, despite having strong performances in December and February. Real estate investor sentiment oscillated between optimism regarding Trump’s proposed economic policies and pessimism due to the interest rate increases.
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Market Overview (continued)
FIRST INVESTORS INCOME FUNDS
FIRST INVESTORS EQUITY FUNDS
International equities were positive as well, but most of the regions lagged behind U.S. equities. Developed markets outside the U.S. and Canada (measured by the MSCI EAFE Index) finished the review period up 6.66% as their U.S. dollar-denominated returns were hurt by an appreciating dollar. Europe (measured by the MSCI EURO Index) was one of the strongest regions, returning 10.80%. It benefited from a pick-up in growth throughout Europe and fading concerns that the anti-Euro candidate, Marine Le Pen, would prevail in the upcoming French presidential election.
Overall, emerging markets (MSCI EM Index) had similar returns as developed markets, gaining 6.93% for the period. However, they had larger quarter-over-quarter swings. They lost 4.08% during the fourth quarter, negatively influenced by Trump’s victory. However, those same markets were up 11.49% during the first quarter, rebounding off of post-election lows, led by Latin America.
Thank you for placing your trust in Foresters Financial. As always, we appreciate the opportunity to serve your investment needs.
This Market Overview is not part of the Funds’ financial report and is submitted for the general information of the shareholders of the Funds. It is not authorized for distribution to prospective investors in the Funds, unless preceded or accompanied by an effective prospectus. The Market Overview reflects conditions through the end of the period as stated on the cover. Market conditions are subject to change. This Market Overview may not be relied upon as investment advice or as an indication of current or future trading intent on behalf of any Fund.
There are a variety of risks associated with investing in mutual funds. For all fund’s, there is the risk that securities selected by the portfolio manager may perform differently than the overall market or may not meet a portfolio manager’s
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expectations. For stock funds, the risks include market risk (the risk that the entire stock market will decline because of an event such as deterioration in the economy or a rise in interest rates), as well as special risks associated with investing in certain types of stock funds, such as small-cap, global and international funds. For bond funds, the risks include interest rate risk and credit risk. Interest rate risk is the risk that bonds will decrease in value as interest rates rise. As a general matter, longer-term bonds fluctuate more than shorter-term bonds in reaction to changes in interest rates. Credit risk is the risk that bonds will decline in value as the result of a decline in the credit rating of the bonds or the economy as a whole, or that the issuer will be unable to pay interest and/or principal when due. There are also special risks associated with investing in certain types of bond funds, including liquidity risk and prepayment and extension risk. To the extent a fund uses derivatives, it will have risks associated with such use. You should consult your prospectus for a precise explanation of the risks associated with your Fund.
| 5 |
Understanding Your Fund’s Expenses (unaudited)
FIRST INVESTORS INCOME FUNDS
FIRST INVESTORS EQUITY FUNDS
As a mutual fund shareholder, you incur two types of costs: (1) transaction costs, including a sales charge (load) on purchase payments (on Class A shares only) and a contingent deferred sales charge on redemptions (on Class B shares only); and (2) ongoing costs, including advisory fees; distribution and service fees (12b-1) (on Class A and Class B shares only); and other 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 examples are based on an investment of $1,000 in each Fund at the beginning of the period, October 1, 2016, and held for the entire six-month period ended March 31, 2017. The calculations assume that no shares were bought or sold during the period. Your actual costs may have been higher or lower, depending on the amount of your investment and the timing of any purchases or redemptions.
Actual Expenses Example:
These amounts help you to estimate the actual expenses that you paid over the period. The “Ending Account Value” shown is derived from the Fund’s actual return, and the “Expenses Paid During Period” shows the dollar amount that would have been paid by an investor who started with $1,000 in the Fund. You may use the information here, together with the amount you invested, to estimate the expenses that you paid over the period.
To estimate the expenses you paid on your account during this period, simply divide your ending account value by $1,000 (for example, an $8,600 account value divided by $1,000 = 8.60), then multiply the result by the number given for your Fund under the heading “Expenses Paid During Period”.
Hypothetical Expenses Example:
These amounts provide information about hypothetical account values and hypothetical expenses based on the Fund’s actual expense ratio for each class of shares of a Fund, and an assumed rate of return of 5% per year before expenses, which is not the Fund’s actual return. The hypothetical account values and expenses may not be used to estimate the actual ending account balance or expenses you paid for the period. You may use this information to compare the ongoing costs of investing in the Fund and other funds. To do so, compare this 5% hypothetical example with the 5% hypothetical examples that appear in the shareholder reports of the other funds.
Please note that the expenses shown in the table are meant to highlight and help you compare your ongoing costs only and do not reflect any transaction costs, such as front-end or contingent deferred sales charges (loads) or account fees that are charged to certain types of accounts, such as an annual custodial fee of $15 for certain IRA accounts and certain other retirement accounts or an annual custodial fee of $30 for 403(b) custodial accounts (subject to exceptions and certain waivers as described in the Funds’ Statement of Additional Information). Therefore, the hypothetical expenses example is useful in comparing ongoing costs only and will not help you determine the relative total costs of owning different funds. In addition, if these costs were included, your costs would have been higher.
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Fund Expenses (unaudited)
BALANCED INCOME FUND
The examples below show the ongoing costs (in dollars) of investing in your Fund and will help you in comparing these costs with costs of other mutual funds. Please refer to page 6 for a detailed explanation of the information presented in these examples.
| Annualized | Beginning | Ending | Expenses Paid | |
| Expense | Account Value | Account Value | During Period | |
| Expense Example | Ratio | (10/1/16) | (3/31/17) | (10/1/16–3/31/17)* |
| Class A Shares | 1.15% | |||
| Actual | $1,000.00 | $1,013.87 | $5.77 | |
| Hypothetical** | $1,000.00 | $1,019.20 | $5.79 | |
| Advisor Class Shares | 0.82% | |||
| Actual | $1,000.00 | $1,014.39 | $4.12 | |
| Hypothetical** | $1,000.00 | $1,020.84 | $4.13 | |
| Institutional Class Shares | 0.69% | |||
| Actual | $1,000.00 | $1,015.92 | $3.47 | |
| Hypothetical** | $1,000.00 | $1,021.49 | $3.48 |
| * | Expenses are equal to the annualized expense ratio, multiplied by the average account value over |
| the period, multiplied by 182/365 (to reflect the one-half year period). Expenses paid during the | |
| period are net of expenses waived and/or assumed. | |
| ** | Assumed rate of return of 5% before expenses |
| Portfolio holdings and allocations are subject to change. Percentages are as of March 31, 2017, and |
| are based on the total market value of investments. |
7 |
Portfolio of Investments (continued)
BALANCED INCOME FUND
March 31, 2017
| Principal | |||
| Amount | Security | Value | |
| CORPORATE BONDS—40.1% | |||
| Aerospace/Defense—.5% | |||
| $ 200M | Rolls-Royce, PLC, 3.625%, 10/14/2025 (a) | $ 201,535 | |
| Automotive—.7% | |||
| 300M | O’Reilly Automotive, Inc., 3.55%, 3/15/2026 | 299,518 | |
| Chemicals—1.1% | |||
| 200M | Agrium, Inc., 3.375%, 3/15/2025 | 197,722 | |
| 300M | Dow Chemical Co., 3.5%, 10/1/2024 | 305,410 | |
| 503,132 | |||
| Consumer Non-Durables—.9% | |||
| 400M | Newell Brands, Inc., 4.2%, 4/1/2026 | 416,754 | |
| Energy—2.9% | |||
| 500M | BP Capital Markets, PLC, 3.216%, 11/28/2023 | 503,001 | |
| 300M | Magellan Midstream Partners, LP, 5%, 3/1/2026 | 330,827 | |
| 465M | Marathon Oil Corp., 3.85%, 6/1/2025 | 457,953 | |
| 1,291,781 | |||
| Financial Services—6.5% | |||
| 500M | American Express Co., 1.6401%, 5/22/2018 † | 501,980 | |
| 300M | American International Group, Inc., 3.75%, 7/10/2025 | 298,853 | |
| 200M | Assured Guaranty U.S. Holding, Inc., 5%, 7/1/2024 | 215,552 | |
| 200M | ERAC USA Finance Co., 7%, 10/15/2037 (a) | 253,534 | |
| Ford Motor Credit Co., LLC: | |||
| 500M | 2.875%, 10/1/2018 | 506,101 | |
| 300M | 1.9496%, 3/12/2019 † | 301,338 | |
| General Electric Capital Corp.: | |||
| 200M | 3.1%, 1/9/2023 | 205,729 | |
| 100M | 6.75%, 3/15/2032 | 135,045 | |
| 250M | Key Bank NA, 3.4%, 5/20/2026 | 243,594 | |
| 200M | State Street Corp., 3.55%, 8/18/2025 | 205,757 | |
| 2,867,483 | |||
| Financials—8.3% | |||
| 400M | Bank of America Corp., 5.875%, 2/7/2042 | 482,756 | |
| 400M | Capital One Financial Corp., 3.75%, 4/24/2024 | 407,419 | |
| 500M | Citigroup, Inc., 3.7%, 1/12/2026 | 501,395 | |
| 200M | Deutsche Bank AG, 3.7%, 5/30/2024 | 196,892 | |
| 300M | General Motors Financial Co., 5.25%, 3/1/2026 | 322,887 |
| 8 |
| Principal | |||
| Amount | Security | Value | |
| $ 200M | Goldman Sachs Group, Inc., 3.625%, 1/22/2023 | $ 205,295 | |
| JPMorgan Chase & Co.: | |||
| 300M | 3.625%, 12/1/2027 | 291,688 | |
| 100M | 6.4%, 5/15/2038 | 129,408 | |
| 100M | Morgan Stanley, 5.5%, 7/28/2021 | 111,003 | |
| U.S. Bancorp: | |||
| 200M | 3.6%, 9/11/2024 | 206,159 | |
| 200M | 3.1%, 4/27/2026 | 196,860 | |
| 300M | Visa, Inc., 3.15%, 12/14/2025 | 301,370 | |
| Wells Fargo & Co.: | |||
| 100M | 5.606%, 1/15/2044 | 114,811 | |
| 200M | 3.9%, 5/1/2045 | 191,971 | |
| 3,659,914 | |||
| Food/Beverage/Tobacco—1.0% | |||
| Anheuser-Busch InBev Finance, Inc.: | |||
| 100M | 3.65%, 2/1/2026 | 101,305 | |
| 200M | 4.7%, 2/1/2036 | 212,249 | |
| 100M | 4.9%, 2/1/2046 | 108,499 | |
| 422,053 | |||
| Food/Drug—.9% | |||
| 400M | CVS Health Corp., 3.875%, 7/20/2025 | 412,849 | |
| Information Technology—2.1% | |||
| 200M | Apple, Inc., 2.5%, 2/9/2025 | 193,693 | |
| 300M | Microsoft Corp., 3.7%, 8/8/2046 | 282,349 | |
| Oracle Corp.: | |||
| 100M | 2.95%, 5/15/2025 | 98,813 | |
| 350M | 2.65%, 7/15/2026 | 333,679 | |
| 908,534 | |||
| Media-Broadcasting—.7% | |||
| 300M | Comcast Corp., 4.25%, 1/15/2033 | 309,406 | |
| Media-Diversified—.5% | |||
| 200M | Time Warner, Inc., 3.6%, 7/15/2025 | 198,103 | |
| Real Estate—6.4% | |||
| 500M | Alexandria Real Estate Equities, Inc., 3.95%, 1/15/2028 | 499,700 | |
| 300M | AvalonBay Communities, Inc., 3.5%, 11/15/2024 | 303,834 | |
| 450M | Boston Properties, LP, 2.75%, 10/1/2026 | 415,044 |
| 9 |
Portfolio of Investments (continued)
BALANCED INCOME FUND
March 31, 2017
| Principal | |||
| Amount | |||
| or Shares | Security | Value | |
| Real Estate (continued) | |||
| $ 200M | ERP Operating, LP, 3.375%, 6/1/2025 | $ 198,450 | |
| 300M | Prologis, LP, 3.75%, 11/1/2025 | 307,118 | |
| 500M | Realty Income Corp., 3.25%, 10/15/2022 | 505,437 | |
| 200M | Simon Property Group, LP, 3.375%, 10/1/2024 | 201,793 | |
| 400M | Welltower, Inc., 4%, 6/1/2025 | 406,121 | |
| 2,837,497 | |||
| Retail-General Merchandise—1.9% | |||
| 200M | Amazon.com, Inc., 4.8%, 12/5/2034 | 222,125 | |
| 500M | Home Depot, Inc., 5.875%, 12/16/2036 | 633,763 | |
| 855,888 | |||
| Telecommunications—1.6% | |||
| 200M | AT&T, Inc., 5.15%, 3/15/2042 | 199,123 | |
| Verizon Communications, Inc.: | |||
| 400M | 3.65%, 9/14/2018 | 410,984 | |
| 100M | 4.272%, 1/15/2036 | 92,892 | |
| 702,999 | |||
| Transportation—2.2% | |||
| 400M | Burlington North Santa Fe, LLC, 5.15%, 9/1/2043 | 457,424 | |
| 200M | Cummins, Inc., 4.875%, 10/1/2043 | 222,966 | |
| 300M | Southwest Airlines Co., 3%, 11/15/2026 | 283,799 | |
| 964,189 | |||
| Utilities—1.9% | |||
| 200M | Dominion Resources, Inc., 3.9%, 10/1/2025 | 203,997 | |
| 200M | Duke Energy Progress, Inc., 4.15%, 12/1/2044 | 203,592 | |
| 100M | Entergy Arkansas, Inc., 4.95%, 12/15/2044 | 102,245 | |
| 100M | Oklahoma Gas & Electric Co., 4%, 12/15/2044 | 96,226 | |
| 200M | South Carolina Electric & Gas Co., 5.45%, 2/1/2041 | 225,343 | |
| 831,403 | |||
| Total Value of Corporate Bonds (cost $18,023,517) | 17,683,038 | ||
| COMMON STOCKS—37.6% | |||
| Consumer Discretionary—4.6% | |||
| 100 | * | Acushnet Holdings Corporation | 1,728 |
| 341 | Adient, PLC | 24,780 | |
| 4,300 | American Eagle Outfitters, Inc. | 60,329 | |
| 10 |
| Shares | Security | Value | |
| Consumer Discretionary (continued) | |||
| 2,600 | Coach, Inc. | $ 107,458 | |
| 6,900 | DSW, Inc. – Class “A” | 142,692 | |
| 8,100 | Ford Motor Company | 94,284 | |
| 2,400 | HSN, Inc. | 89,040 | |
| 4,964 | Johnson Controls International, PLC | 209,084 | |
| 3,500 | L Brands, Inc. | 164,850 | |
| 4,600 | Newell Brands, Inc. | 216,982 | |
| 3,600 | Nordstrom, Inc. | 167,652 | |
| 4,600 | Regal Entertainment Group – Class “A” | 103,868 | |
| 3,800 | Tupperware Brands Corporation | 238,336 | |
| 650 | Whirlpool Corporation | 111,365 | |
| 2,100 | Williams-Sonoma, Inc. | 112,602 | |
| 2,000 | Wyndham Worldwide Corporation | 168,580 | |
| 2,013,630 | |||
| Consumer Staples—5.8% | |||
| 6,600 | Altria Group, Inc. | 471,372 | |
| 5,400 | B&G Foods, Inc. | 217,350 | |
| 4,200 | Coca-Cola Company | 178,248 | |
| 7,500 | Koninklijke Ahold Delhaize NV (ADR) | 160,800 | |
| 2,400 | Nu Skin Enterprises, Inc. – Class “A” | 133,296 | |
| 3,100 | PepsiCo, Inc. | 346,766 | |
| 4,600 | Philip Morris International, Inc. | 519,340 | |
| 1,600 | Procter & Gamble Company | 143,760 | |
| 3,300 | Sysco Corporation | 171,336 | |
| 2,900 | Wal-Mart Stores, Inc. | 209,032 | |
| 2,551,300 | |||
| Energy—1.7% | |||
| 700 | Chevron Corporation | 75,159 | |
| 1,400 | ExxonMobil Corporation | 114,814 | |
| 2,900 | Marathon Petroleum Corporation | 146,566 | |
| 750 | Occidental Petroleum Corporation | 47,520 | |
| 3,600 | PBF Energy, Inc. – Class “A” | 79,812 | |
| 700 | Phillips 66 | 55,454 | |
| 2,000 | Royal Dutch Shell, PLC – Class “A” (ADR) | 105,460 | |
| 650 | Schlumberger, Ltd. | 50,765 | |
| 3,200 | Suncor Energy, Inc. | 98,400 | |
| 773,950 |
| 11 |
Portfolio of Investments (continued)
BALANCED INCOME FUND
March 31, 2017
| Shares | Security | Value | |
| Financials—4.3% | |||
| 2,000 | Ameriprise Financial, Inc. | $ 259,360 | |
| 3,100 | Berkshire Hills Bancorp, Inc. | 111,755 | |
| 1,100 | Chubb, Ltd. | 149,875 | |
| 3,600 | Discover Financial Services | 246,204 | |
| 100 | * | Hamilton Lane, Inc. – Class “A” | 1,867 |
| 3,000 | JPMorgan Chase & Company | 263,520 | |
| 3,600 | MetLife, Inc. | 190,152 | |
| 1,600 | PNC Financial Services Group, Inc. | 192,384 | |
| 4,100 | U.S. Bancorp | 211,150 | |
| 8,600 | Waddell & Reed Financial, Inc. – Class “A” | 146,200 | |
| 2,500 | Wells Fargo & Company | 139,150 | |
| 1,911,617 | |||
| Health Care—4.3% | |||
| 5,500 | Abbott Laboratories | 244,255 | |
| 5,100 | AbbVie, Inc. | 332,316 | |
| 6,600 | GlaxoSmithKline, PLC (ADR) | 278,256 | |
| 3,100 | Johnson & Johnson | 386,105 | |
| 3,900 | Merck & Company, Inc. | 247,806 | |
| 11,400 | Pfizer, Inc. | 389,994 | |
| 1,878,732 | |||
| Industrials—4.5% | |||
| 2,000 | 3M Company | 382,660 | |
| 6,800 | General Electric Company | 202,640 | |
| 2,000 | Honeywell International, Inc. | 249,740 | |
| 5,900 | Koninklijke Philips NV (ADR) | 189,449 | |
| 1,400 | Lockheed Martin Corporation | 374,640 | |
| 4,000 | Mobile Mini, Inc. | 122,000 | |
| 1,700 | Textainer Group Holdings, Ltd. | 26,010 | |
| 11,100 | Triton International, Ltd. | 286,269 | |
| 1,200 | United Technologies Corporation | 134,652 | |
| 1,968,060 | |||
| Information Technology—5.8% | |||
| 3,300 | Apple, Inc. | 474,078 | |
| 9,100 | Cisco Systems, Inc. | 307,580 | |
| 4,600 | Intel Corporation | 165,922 | |
| 1,200 | International Business Machines Corporation | 208,968 | |
| 5,800 | Maxim Integrated Products, Inc. | 260,768 | |
| 6,800 | Microsoft Corporation | 447,848 |
| 12 |
| Shares | Security | Value | |
| Information Technology (continued) | |||
| 4,600 | QUALCOMM, Inc. | $ 263,764 | |
| 2,400 | Symantec Corporation | 73,632 | |
| 8,000 | Travelport Worldwide, Ltd. | 94,160 | |
| 3,200 | Western Digital Corporation | 264,096 | |
| 2,560,816 | |||
| Materials—.9% | |||
| 3,100 | International Paper Company | 157,418 | |
| 1,150 | Praxair, Inc. | 136,390 | |
| 1,950 | RPM International, Inc. | 107,308 | |
| 401,116 | |||
| Real Estate—1.8% | |||
| 10,000 | Brixmor Property Group, Inc. (REIT) | 214,600 | |
| 4,400 | Chesapeake Lodging Trust (REIT) | 105,424 | |
| 14,400 | FelCor Lodging Trust, Inc. (REIT) | 108,144 | |
| 5,600 | Sunstone Hotel Investors, Inc. (REIT) | 85,848 | |
| 6,200 | Tanger Factory Outlet Centers, Inc. (REIT) | 203,174 | |
| 4,500 | Urstadt Biddle Properties, Inc. – Class “A” (REIT) | 92,520 | |
| 809,710 | |||
| Telecommunication Services—1.4% | |||
| 8,300 | AT&T, Inc. | 344,865 | |
| 5,500 | Verizon Communications, Inc. | 268,125 | |
| 612,990 | |||
| Utilities—2.5% | |||
| 3,000 | Black Hills Corporation | 199,410 | |
| 3,400 | Duke Energy Corporation | 278,834 | |
| 4,200 | Exelon Corporation | 151,116 | |
| 5,800 | NiSource, Inc. | 137,982 | |
| 3,000 | SCANA Corporation | 196,050 | |
| 2,400 | WEC Energy Group, Inc. | 145,512 | |
| 1,108,904 | |||
| Total Value of Common Stocks (cost $15,137,252) | 16,590,825 | ||
| 13 |
Portfolio of Investments (continued)
BALANCED INCOME FUND
March 31, 2017
| Principal | |||||
| Amount | |||||
| or Shares | Security | Value | |||
| RESIDENTIAL MORTGAGE-BACKED | |||||
| SECURITIES—7.3% | |||||
| Fannie Mae: | |||||
| $ 663M | 3%, 4/1/2046 – 6/1/2046 | $ 658,188 | |||
| 1,027M | 3.5%, 9/1/2045 – 11/1/2046 | 1,052,203 | |||
| 1,053M | 4%, 11/1/2045 – 7/1/2046 | 1,107,564 | |||
| 297M | 4.5%, 1/1/2047 | 319,038 | |||
| 72M | 5%, 8/1/2039 | 79,306 | |||
| Total Value of Residential Mortgage-Backed Securities (cost $3,261,805) | 3,216,299 | ||||
| U.S. GOVERNMENT OBLIGATIONS—3.6% | |||||
| U.S. Treasury Notes: | |||||
| 700M | 0.9515%, 10/31/2018 † | 701,120 | |||
| 875M | 1.0535%, 1/31/2018 † | 877,042 | |||
| Total Value of U.S. Government Obligations (cost $1,577,119) | 1,578,162 | ||||
| VARIABLE AND FLOATING RATE NOTES—2.7% | |||||
| Municipal Bonds | |||||
| 1,200M | Illinois St. Fin. Auth. Rev., 0.9%, 7/1/2038 (cost $1,199,798) † | 1,200,000 | |||
| EXCHANGE TRADED FUNDS—1.9% | |||||
| 9,500 | ishares iBoxx USD High Yield Corporate Bond ETF (ETF) | ||||
| (cost $794,601) | 833,910 | ||||
| SHORT-TERM U.S. GOVERNMENT AGENCY | |||||
| OBLIGATIONS—5.1% | |||||
| Federal Home Loan Bank: | |||||
| $ 750M | 0.71%, 4/21/2017 | 749,745 | |||
| 1,500M | 0.74%, 4/26/2017 | 1,499,349 | |||
| Total Value of Short-Term U.S. Government | |||||
| Agency Obligations (cost $2,248,933) | 2,249,094 | ||||
| Total Value of Investments (cost $42,243,025) | 98.3 | % | 43,351,328 | ||
| Other Assets, Less Liabilities | 1.7 | 759,905 | |||
| Net Assets | 100.0 | % | $44,111,233 | ||
| * | Non-income producing |
| (a) | Security exempt from registration under Rule 144A of the Securities Act of 1933 (see Note 4). |
| † | Interest rates are determined and reset periodically. The interest rates above are the rates in effect |
| at March 31, 2017 |
| 14 |
| Summary of Abbreviations: | |
| ADR | American Depositary Receipts |
| ETF | Exchange Traded Fund |
| REIT | Real Estate Investment Trust |
| USD | United States Dollar |
Futures contracts outstanding at March 31, 2017:
| Value at | |||||||||
| Number of | Value at | March 31, | Unrealized | ||||||
| Contracts | Type | Expiration | Trade Date | 2017 | Appreciation | ||||
| 5 | 5 Year U.S. | Jun. 2017 | $ 588,984 | $ 589,272 | $ 288 | ||||
| Treasury Note | |||||||||
| 19 | 10 Year U.S. | Jun. 2017 | 2,367,133 | 2,367,336 | 203 | ||||
| Treasury Note | |||||||||
| 7 | U.S. Treasury | Jun. 2017 | 1,059,516 | 1,063,036 | 3,520 | ||||
| Long Bond | |||||||||
| (Premium received $396) | $4,011 | ||||||||
| 15 |
Portfolio of Investments (continued)
BALANCED INCOME FUND
March 31, 2017
The Fund’s assets and liabilities are classified into the following three levels based on the inputs used to value the assets or liabilities:
| Level 1 — Unadjusted quoted prices in active markets for identical securities that the Fund has the ability to access. |
| Level 2 — Observable inputs other than quoted prices included in Level 1 that are observable for the asset or liability, either directly or indirectly. These inputs may include quoted prices for the identical instrument on an inactive market, prices for similar instruments, interest rates, prepayment speeds, credit risk, yield curves, default rates and similar data. |
| Level 3 — Unobservable inputs for the asset or liability, to the extent relevant observable inputs are not available, representing the Fund’s own assumption about the assumptions a market participant would use in valuing the asset or liability, and would be based on the best information available. |
The inputs methodology used for valuing securities are not necessarily an indication of the risk associated with investing in those securities. For example, U.S. Government securities are reflected as Level 2 because the inputs used to determine fair value may not always be quoted prices in an active market.
The following is a summary, by category of Level, of inputs used to value the Fund’s investments as of March 31, 2017:
| Level 1 | Level 2 | Level 3 | Total | |||||||||
| Corporate Bonds | $ | — | $ | 17,683,038 | $ | — | $ | 17,683,038 | ||||
| Common Stocks | 16,590,825 | — | — | 16,590,825 | ||||||||
| Residential Mortgage-Backed | ||||||||||||
| Securities | — | 3,216,299 | — | 3,216,299 | ||||||||
| U.S. Government Obligations | — | 1,578,162 | — | 1,578,162 | ||||||||
| Variable and Floating Rate Notes | — | 1,200,000 | — | 1,200,000 | ||||||||
| Exchange Traded Funds | 833,910 | — | — | 833,910 | ||||||||
| Short-Term U.S. Government | ||||||||||||
| Agency Obligations | — | 2,249,094 | — | 2,249,094 | ||||||||
| Total Investments in Securities* | $ | 17,424,735 | $ | 25,926,593 | $ | — | $ | 43,351,328 | ||||
| Other Assets | ||||||||||||
| Futures Contracts | $ | 4,407 | $ | — | $ | — | $ | 4,407 |
| * | The Portfolio of Investments provides information on the industry categorization for corporate bonds, |
| common stocks and variable and floating rate notes. | |
| There were no transfers into or from Level 1 and Level 2 by the Fund for the period ended March 31, | |
| 2017. Transfers, if any, between Levels are recognized at the end of the reporting period. |
| 16 | See notes to financial statements |
Fund Expenses (unaudited)
FLOATING RATE FUND
The examples below show the ongoing costs (in dollars) of investing in your Fund and will help you in comparing these costs with costs of other mutual funds. Please refer to page 6 for a detailed explanation of the information presented in these examples.
| Annualized | Beginning | Ending | Expenses Paid | |
| Expense | Account Value | Account Value | During Period | |
| Expense Example | Ratio | (10/1/16) | (3/31/17) | (10/1/16–3/31/17)* |
| Class A Shares | 1.10% | |||
| Actual | $1,000.00 | $1,018.63 | $5.54 | |
| Hypothetical** | $1,000.00 | $1,019.45 | $5.54 | |
| Advisor Class Shares | 0.90% | |||
| Actual | $1,000.00 | $1,019.57 | $4.53 | |
| Hypothetical** | $1,000.00 | $1,020.44 | $4.53 | |
| Institutional Class Shares | 0.70% | |||
| Actual | $1,000.00 | $1,020.54 | $3.53 | |
| Hypothetical** | $1,000.00 | $1,021.44 | $3.53 |
| * | Expenses are equal to the annualized expense ratio, multiplied by the average account value over |
| the period, multiplied by 182/365 (to reflect the one-half year period). Expenses paid during the | |
| period are net of expenses waived and/or assumed. | |
| ** | Assumed rate of return of 5% before expenses. |
| Portfolio holdings and allocations are subject to change. Percentages are as of March 31, 2017, and |
| are based on the total market value of investments. |
| 17 |
Portfolio of Investments
FLOATING RATE FUND
March 31, 2017
| Principal | |||
| Amount | Security | Value | |
| LOAN PARTICIPATIONS†—87.8% | |||
| Aerospace/Defense—1.9% | |||
| $ 1,164M | B/E Aerospace, Inc., 4.0333%, 12/16/2021 | $ 1,167,609 | |
| TransDigm, Inc.: | |||
| 348M | 4.0367%, 5/14/2022 | 347,516 | |
| 1,356M | 4.1169%, 2/28/2020 | 1,357,912 | |
| 2,873,037 | |||
| Automotive—4.2% | |||
| 775M | Cooper-Standard Automotive, Inc., 3.89678%, 11/2/2023 | 783,527 | |
| 1,095M | Federal-Mogul Holdings, LLC, 4%, 4/15/2018 | 1,095,196 | |
| 1,468M | Hertz Corp., 3.73222%, 6/30/2023 | 1,471,654 | |
| 977M | KAR Auction Services, Inc., 4.1875%, 3/11/2021 | 985,913 | |
| 836M | Key Safety Systems, Inc., 5.54%, 8/29/2021 | 846,901 | |
| 623M | Tectum Holdings, Inc., 5.8226%, 8/24/2023 | 631,620 | |
| 665M | TI Group Automotive Systems, LLC, 3.73222%, 6/30/2022 | 668,199 | |
| 6,483,010 | |||
| Building Materials—.9% | |||
| 934M | Builders FirstSource, Inc., 4%, 2/29/2024 | 934,301 | |
| 484M | Headwaters, Inc., 4%, 3/24/2022 | 485,856 | |
| 1,420,157 | |||
| Chemicals—2.6% | |||
| 868M | A. Schulman, Inc., 4.0556%, 6/1/2022 | 871,470 | |
| 969M | Chemours Co., 6%, 5/12/2022 | 971,034 | |
| 495M | Huntsman International, LLC, 3.98222%, 4/1/2023 | 500,224 | |
| 663M | Methanol Holdings Trinidad, Ltd., 4.48222%, 6/30/2022 | 663,188 | |
| 915M | Univar USA, Inc., 3.73222%, 7/1/2022 | 923,825 | |
| 3,929,741 | |||
| Consumer Non-Durables—2.0% | |||
| 896M | Revlon Consumer Products Corp., 4.48222%, 9/7/2023 | 897,515 | |
| 1,233M | Reynolds Group Holdings, Inc., 3.98222%, 2/5/2023 | 1,239,102 | |
| 945M | Spectrum Brands Canada, Inc., 3.3989%, 6/23/2022 | 951,874 | |
| 3,088,491 |
| 18 |
| Principal | |||
| Amount | Security | Value | |
| Energy—2.1% | |||
| $ 881M | Granite Acquisition, Inc., 5.14678%, 12/17/2021 | $ 889,272 | |
| 925M | Jonah Energy, LLC, 7.5%, 5/12/2021 | 878,750 | |
| 775M | MEG Energy Corp., 4.54%, 12/31/2023 | 775,161 | |
| 625M | Summit Midstream Partners Holdings, LLC, 7.02167%, 5/13/2022 | 636,719 | |
| 3,179,902 | |||
| Financial Services—1.6% | |||
| 1,728M | Delos Finance Sarl, 3.39678%, 10/6/2023 | 1,751,221 | |
| 644M | Ineos U.S. Finance, LLC, 3.73222%, 3/31/2022 (b) | 647,942 | |
| 2,399,163 | |||
| Financials—1.4% | |||
| 800M | Avolon TLB Borrower 1 U.S., LLC, 3.745%, 3/21/2022 (b) | 809,000 | |
| 250M | Helix Generation Funding, LLC, 3.75%, 3/9/2024 (b) | 253,750 | |
| 1,024M | Lightstone Holding Co., LLC, 5.539%, 1/30/2024 | 1,030,999 | |
| 2,093,749 | |||
| Food/Beverage/Tobacco—2.0% | |||
| 533M | B&G Foods, Inc., 3.81056%, 11/2/2022 | 536,425 | |
| 1,073M | Chobani, LLC, 5.25%, 10/9/2023 (b) | 1,084,629 | |
| 1,471M | Pinnacle Foods Finance, LLC, 2.81056%, 2/2/2024 | 1,479,274 | |
| 3,100,328 | |||
| Forest Products/Containers—2.1% | |||
| 1,207M | Berry Plastics Corp., 3.5009%, 10/1/2022 | 1,216,083 | |
| 650M | BWay Holding Co., 3.25%, 4/3/2024 (b) | 650,203 | |
| 713M | BWay Intermediate Co., Inc., 4.75%, 8/14/2020 | 714,404 | |
| 706M | Exopack Holdings SA, 4.64678%, 5/8/2019 | 707,910 | |
| 3,288,600 | |||
| Gaming/Leisure—4.9% | |||
| AMC Entertainment Holdings, Inc.: | |||
| 876M | 3.6622%, 12/15/2022 | 884,734 | |
| 375M | 3.73278%, 12/15/2023 | 378,574 | |
| 300M | Delta 2 Lux Sarl, 4.245%, 2/1/2024 (b) | 300,141 | |
| 1,237M | Hilton Worldwide Finance, LLC, 2.9817%, 10/25/2023 | 1,246,592 | |
| 1,316M | La Quinta Intermediate Holdings, LLC, 3.77178%, 4/14/2021 | 1,325,994 | |
| 840M | Lions Gate Entertainment Corp., 3.98222%, 12/8/2023 | 846,038 |
| 19 |
Portfolio of Investments (continued)
FLOATING RATE FUND
March 31, 2017
| Principal | |||
| Amount | Security | Value | |
| Gaming/Leisure (continued) | |||
| $ 1,469M | Live Nation Entertainment, Inc., 3.5%, 10/31/2023 | $ 1,485,144 | |
| 230M | Pinnacle Entertainment, Inc., 3.99%, 4/28/2023 | 233,060 | |
| 871M | Seminole Hard Rock Entertainment, Inc., 3.89678%, 5/14/2020 | 877,397 | |
| 7,577,674 | |||
| Health Care—7.9% | |||
| CHS/Community Health Systems, Inc.: | |||
| 219M | 3.7976%, 12/31/2019 | 217,917 | |
| 739M | 4.0477%, 1/27/2021 | 730,717 | |
| 523M | Cotiviti Corp., 3.9%, 9/28/2023 | 527,575 | |
| 565M | DaVita, Inc., 3.73222%, 6/24/2021 | 571,808 | |
| 1,075M | Envision Healthcare Corp., 4.15%, 12/1/2023 | 1,085,303 | |
| 444M | ExamWorks Group, Inc., 3.5%, 7/27/2023 | 447,217 | |
| 566M | Kindred Healthcare, Inc., 4.5625%, 4/9/2021 | 565,584 | |
| 531M | Mallinckrodt International Finance SA, 3.89678%, 9/24/2024 | 532,030 | |
| 506M | MPH Acquisition Holdings, LLC, 4.89678%, 6/7/2023 | 513,020 | |
| 1,146M | Nature’s Bounty Co., 4.64678%, 5/5/2023 | 1,154,233 | |
| 388M | Onex Carestream Finance, LP, 5.14678%, 6/7/2019 | 376,101 | |
| 300M | Prestige Brands Holdings, Inc., 3.7322%, 1/26/2024 | 303,375 | |
| 716M | Quintiles IMS, Inc., 2.9746%, 3/7/2024 | 721,567 | |
| RPI Finance Trust: | |||
| 60M | 3.15289%, 3/23/2023 (b) | 60,337 | |
| 1,204M | 3.64678%, 10/14/2022 | 1,210,730 | |
| 1,500M | Sterigenics-Nordion Holdings, LLC, 3%, 5/15/2022 (b) | 1,502,345 | |
| 1,558M | Valeant Pharma International, Inc., 5.57%, 4/1/2022 | 1,565,383 | |
| 12,085,242 | |||
| Industrials—.7% | |||
| 1,147M | SIG Combibloc Holdings SCA, 4%, 3/11/2022 | 1,155,844 | |
| Information Technology—7.2% | |||
| 331M | ARRIS Group, Inc., 3.73222%, 4/17/2020 | 333,931 | |
| 1,580M | Avast Holdings BV, 5%, 9/30/2022 | 1,591,850 | |
| 875M | Change Heathcare Holdings, 3.75%, 3/1/2024 | 877,187 | |
| 878M | Dell International, LLC, 3.49%, 9/7/2023 | 882,737 | |
| 225M | Gartner Group, Inc., 2.99875%, 3/15/2024 (b) | 226,828 | |
| 658M | Global Payments, Inc., 3.48222%, 4/21/2023 | 663,394 | |
| Go Daddy Operating Co., LLC: | |||
| 809M | 3.41222%, 2/15/2024 (b) | 810,521 | |
| 1,067M | 3.4975%, 2/15/2024 (b) | 1,069,166 | |
| 678M | Match Group, Inc., 4.09667%, 11/16/2022 | 680,668 |
| 20 |
| Principal | |||
| Amount | Security | Value | |
| Information Technology (continued) | |||
| $ 399M | Micron Technology, Inc., 4.74%, 4/26/2022 | $ 404,234 | |
| 403M | Microsemi Corp., 3.22611%, 1/15/2023 (b) | 405,708 | |
| 1,563M | Quest Software U.S., 7%, 10/31/2022 | 1,588,482 | |
| 736M | Western Digital Corp., 3.73222%, 4/29/2023 | 741,362 | |
| 714M | Zebra Technologies Corp., 3.6%, 10/27/2021 | 720,096 | |
| 10,996,164 | |||
| Manufacturing—6.8% | |||
| 1,870M | Brand Energy & Infrastructure, 4.772%, 11/26/2020 (b) | 1,877,455 | |
| 1,450M | Columbus McKinnon Corp., 4.1468%, 1/31/2024 | 1,464,500 | |
| 625M | Douglas Dynamics, LLC, 4.5%, 12/31/2021 | 628,125 | |
| 977M | Filtration Group, Inc., 4.304%, 11/23/2020 | 985,323 | |
| 1,178M | Gardner Denver, Inc., 4.5588%, 7/30/2020 | 1,175,247 | |
| 1,147M | Gates Global, LLC, 4.39678%, 7/6/2021 | 1,150,122 | |
| 939M | Husky Injection Molding System, 4.25%, 6/30/2021 | 944,858 | |
| 1,045M | RBS Global, Inc., 3.8371%, 8/21/2023 | 1,050,510 | |
| 1,204M | U.S. Farathane, LLC, 5.1468%, 12/23/2021 | 1,220,156 | |
| 10,496,296 | |||
| Media-Broadcasting—4.5% | |||
| 2,575M | Altice Financing SA, 3.7475%, 7/28/2025 (b) | 2,573,699 | |
| 1,340M | Altice France SA, 5.289%, 1/15/2024 | 1,349,226 | |
| 2,250M | Altice U.S. Finance I, 4.2475%, 7/28/2025 (b) | 2,256,750 | |
| CBS Radio, Inc.: | |||
| 125M | 4.495%, 11/1/2023 (b) | 125,625 | |
| 557M | 4.5%, 10/17/2023 | 563,721 | |
| 6,869,021 | |||
| Media-Cable TV—4.7% | |||
| 1,361M | Charter Communications, 3.23222%, 1/15/2024 | 1,369,475 | |
| CSC Holdings, LLC : | |||
| 500M | 3.245%, 7/15/2025 (b) | 500,000 | |
| 1,371M | 3.94278%, 10/11/2024 | 1,380,616 | |
| 748M | Gray Television, Inc., 3.33444%, 2/7/2024 | 753,736 | |
| 823M | Midcontinent Communications, Inc., 3.3344%, 12/31/2023 | 831,681 | |
| 102M | Mission Broadcasting, Inc., 3.9428%, 1/17/2024 | 102,744 | |
| 1,086M | Nexstar Broadcasting, Inc., 3.94278%, 1/17/2024 | 1,095,915 | |
| 614M | Raycom TV Broadcasting, LLC, 3.98222%, 8/4/2021 | 615,786 | |
| 600M | Ziggo Secured Finance BV, 3.41222%, 4/15/2025 | 599,625 | |
| 7,249,578 |
| 21 |
Portfolio of Investments (continued)
FLOATING RATE FUND
March 31, 2017
| Principal | |||
| Amount | Security | Value | |
| Media-Diversified—.8% | |||
| $ 489M | Tribune Media Co., 3.98222%, 1/26/2024 | $ 492,169 | |
| 801M | Virgin Media Bristol, LLC, 3.66222%, 1/31/2025 | 803,836 | |
| 1,296,005 | |||
| Metals/Mining—4.1% | |||
| 1,250M | Arch Coal, Inc., 5%, 3/7/2024 | 1,250,781 | |
| 401M | FMG Resources Property, 3.75%, 6/30/2019 | 404,206 | |
| 1,300M | Foresight Energy, LLC, 6.735%, 3/28/2022 (b) | 1,272,375 | |
| 1,381M | MRC Global U.S., Inc., 5%, 11/8/2019 | 1,394,722 | |
| 225M | Peabody Energy Corp., 5.495%, 2/8/2022 (b) | 226,125 | |
| 882M | TMS International Corp., 4.5565%, 10/16/2020 | 886,166 | |
| 845M | Zekelman Industries, Inc., 4.90622%, 6/14/2021 | 856,120 | |
| 6,290,495 | |||
| Real Estate—.4% | |||
| 579M | Realogy Group, LLC, 3.23167%, 7/20/2022 | 581,594 | |
| Retail-General Merchandise—8.8% | |||
| 1011778 B.C. Unlimited: | |||
| 250M | 3.25%, 2/16/2024 (b) | 251,094 | |
| 1,079M | 3.3093%, 2/16/2024 | 1,088,229 | |
| 950M | 84 Lumber Co., 6.75%, 10/25/2023 | 961,875 | |
| 1,375M | Bass Pro Group, LLC, 5.97039%, 12/15/2023 | 1,323,437 | |
| 1,300M | BJ’s Wholesale Club, Inc., 4.75%, 2/3/2024 | 1,271,292 | |
| 916M | CNT Holdings III Corp., 4.28%, 1/22/2023 | 922,636 | |
| 521M | General Nutrition Centers, Inc., 3.49%, 3/4/2019 | 445,705 | |
| 750M | Hanesbrands, Inc., 3.4822%, 4/29/2022 | 756,578 | |
| 1,542M | Harbor Freight Tools USA, Inc., 4.23222%, 8/18/2023 | 1,542,250 | |
| 1,020M | KFC Holding Co., 2.9761%, 6/16/2023 | 1,028,587 | |
| 1,125M | Landry’s, Inc., 4.0410%, 10/4/2023 | 1,136,250 | |
| 871M | Neiman Marcus Group, Inc., 4.25%, 10/25/2020 | 701,190 | |
| 1,050M | Party City Holdings, Inc., 3.8718%, 8/19/2022 | 1,049,333 | |
| 995M | Planet Fitness Holdings, LLC, 4.5269%, 3/31/2021 | 996,244 | |
| 13,474,700 |
| 22 |
| Principal | |||
| Amount | Security | Value | |
| Services—3.8% | |||
| $ 500M | Aramark Services, Inc., 2.98287%, 3/28/2024 (b) | $ 503,750 | |
| 1,437M | Brickman Group, Ltd., LLC, 4.0008%, 12/18/2020 | 1,444,410 | |
| 790M | Doosan Bobcat, Inc., 4.5%, 5/28/2021 | 799,465 | |
| 948M | Monitronics International, Inc., 6.6468%, 9/30/2022 | 960,569 | |
| 1,546M | Safway Group Holding, LLC, 5.75%, 8/21/2023 | 1,565,452 | |
| 525M | TKC Holdings, Inc., 4.75%, 2/1/2023 | 529,266 | |
| 5,802,912 | |||
| Telecommunications—3.3% | |||
| 1,009M | CommScope, Inc., 3.48222%, 12/29/2022 | 1,018,005 | |
| 1,081M | GCI Holdings, Inc., 3.98222%, 2/2/2022 | 1,091,897 | |
| 1,200M | Level 3 Financing, Inc., 3.2272%, 2/22/2024 | 1,202,626 | |
| 1,250M | Telenet International Finance Sarl, 3.91222%, 1/31/2025 | 1,250,000 | |
| 435M | Zayo Group, LLC, 3.5%, 1/19/2024 | 437,719 | |
| 5,000,247 | |||
| Transportation—.3% | |||
| 454M | XPO Logistics, Inc., 3.1078%, 11/1/2021 | 455,835 | |
| Utilities—4.3% | |||
| 961M | Calpine Corp., 3.9%, 1/15/2024 | 966,398 | |
| 425M | Dayton Power & Light Co., 4.24%, 8/24/2022 | 429,250 | |
| 475M | Dynegy, Inc., 4.25%, 6/27/2023 | 476,979 | |
| HD Supply, Inc.: | |||
| 750M | 3.73222%, 8/13/2021 | 756,551 | |
| 549M | 3.73222%, 10/17/2023 | 553,254 | |
| 995M | NRG Energy, Inc., 3.23222%, 6/30/2023 | 1,000,182 | |
| 1,075M | Talen Energy Supply, LLC, 6.06%, 12/6/2023 | 1,091,125 | |
| 1,272M | Vistra Operations Co., LLC, 3.7222%, 8/4/2023 | 1,270,550 | |
| 6,544,289 | |||
| Waste Management—1.4% | |||
| 950M | Advanced Disposal Services, 3.69778%, 11/10/2023 | 957,139 | |
| 1,119M | GFL Environmental, Inc., 3.89678%, 9/29/2023 | 1,126,022 | |
| 2,083,161 |
| 23 |
Portfolio of Investments (continued)
FLOATING RATE FUND
March 31, 2017
| Principal | |||
| Amount | Security | Value | |
| Wireless Communications—3.1% | |||
| $ 1,600M | Intelsat Jackson Holdings SA, 3.88733%, 6/30/2019 | $ 1,571,501 | |
| 1,450M | Sprint Communications, Inc., 3.5%, 2/2/2024 | 1,451,812 | |
| 1,747M | Telesat Canada, 4.15%, 11/17/2023 | 1,770,899 | |
| 4,794,212 | |||
| Total Value of Loan Participations (cost $133,769,384) | 134,609,447 | ||
| CORPORATE BONDS—7.5% | |||
| Aerospace/Defense—.2% | |||
| 325M | Bombardier, Inc., 8.75%, 12/1/2021 (a) | 356,687 | |
| Building Materials—.5% | |||
| 750M | Griffon Corp., 5.25%, 3/1/2022 | 752,813 | |
| Energy—2.0% | |||
| 750M | Murphy Oil USA, Inc., 6%, 8/15/2023 | 789,375 | |
| 400M | Precision Drilling Corp., 6.5%, 12/15/2021 | 401,088 | |
| 1,000M | Targa Resources Partners, LP, 4.125%, 11/15/2019 | 1,021,250 | |
| 800M | Tesoro Logistics, LP, 6.25%, 10/15/2022 | 849,000 | |
| 3,060,713 | |||
| Financials—.4% | |||
| 626M | Consolidated Energy Finance SA, 6.75%, 10/15/2019 (a) | 633,825 | |
| Forest Products/Container—.5% | |||
| 700M | Ardagh Holdings USA, Inc., 4.289%, 5/15/2021 (a) | 718,375 | |
| Health Care—.9% | |||
| 800M | Centene Corp., 5.625%, 2/15/2021 | 839,280 | |
| 150M | Endo Finance, LLC, 7.25%, 1/15/2022 (a) | 142,500 | |
| 450M | Molina Healthcare, Inc., 5.375%, 11/15/2022 | 468,842 | |
| 1,450,622 | |||
| Manufacturing—.5% | |||
| 700M | H&E Equipment Services, Inc., 7%, 9/1/2022 | 737,625 | |
| Media-Cable TV—.4% | |||
| 500M | DISH DBS Corp., 7.875%, 9/1/2019 | 552,500 | |
| 24 |
| Principal | |||||
| Amount | Security | Value | |||
| Metals/Mining—.9% | |||||
| $ 275M | Aleris International, Inc., 9.5%, 4/1/2021 (a) | $ 297,000 | |||
| 650M | Barminco Holdings Property, Ltd., 9%, 6/1/2018 (a) | 685,750 | |||
| 325M | Teck Resources, Ltd., 8.5%, 6/1/2024 (a) | 375,781 | |||
| 1,358,531 | |||||
| Services—.3% | |||||
| 450M | Cimpress NV, 7%, 4/1/2022 (a) | 468,000 | |||
| Telecommunications—.1% | |||||
| 225M | Wind Acquisition Finance SA, 4.75%, 7/15/2020 (a) | 229,781 | |||
| Utilities—.6% | |||||
| 430M | Calpine Corp., 6%, 1/15/2022 (a) | 449,887 | |||
| 500M | Dynegy, Inc., 6.75%, 11/1/2019 | 516,250 | |||
| 966,137 | |||||
| Wireless Communications—.2% | |||||
| 250M | T-Mobile USA, Inc., 6.125%, 1/15/2022 | 264,688 | |||
| Total Value of Corporate Bonds (cost $11,412,514) | 11,550,297 | ||||
| VARIABLE AND FLOATING RATE NOTES—.1% | |||||
| Utilities | |||||
| 219M | AES Corp., 4.05456%, 6/1/2019 (cost $214,827) † | 219,548 | |||
| SHORT-TERM U.S. GOVERNMENT AGENCY | |||||
| OBLIGATIONS—6.5% | |||||
| 10,000M | Federal Home Loan Bank, 0.7%, 4/11/2017 (cost $9,998,055) | 9,998,490 | |||
| Total Value of Investments (cost $155,394,780) | 101.9 | % | 156,377,782 | ||
| Excess of Liabilities Over Other Assets | (1.9 | ) | (2,850,398) | ||
| Net Assets | 100.0 | % | $153,527,384 | ||
| (a) | Security exempt from registration under Rule 144A of the Securities Act of 1933 (see Note 4). |
| (b) | A portion or all of the security purchased on a when-issued or delayed delivery basis. |
| † | Interest rates are determined and reset periodically. The interest rates above are the rates in effect |
| at March 31, 2017. |
| 25 |
Portfolio of Investments (continued)
FLOATING RATE FUND
March 31, 2017
The Fund’s assets and liabilities are classified into the following three levels based on the inputs used to value the assets or liabilities:
| Level 1 — Unadjusted quoted prices in active markets for identical securities that the Fund has the ability to access. |
| Level 2 — Observable inputs other than quoted prices included in Level 1 that are observable for the asset or liability, either directly or indirectly. These inputs may include quoted prices for the identical instrument on an inactive market, prices for similar instruments, interest rates, prepayment speeds, credit risk, yield curves, default rates and similar data. |
| Level 3 — Unobservable inputs for the asset or liability, to the extent relevant observable inputs are not available, representing the Fund’s own assumption about the assumptions a market participant would use in valuing the asset or liability, and would be based on the best information available. |
The inputs methodology used for valuing securities are not necessarily an indication of the risk associated with investing in those securities. For example, U.S. Government securities are reflected as Level 2 because the inputs used to determine fair value may not always be quoted prices in an active market.
The following is a summary, by category of Level, of inputs used to value the Fund’s investments as of March 31, 2017:
| Level 1 | Level 2 | Level 3 | Total | |||||||||
| Loan Participations | $ | — | $ | 134,609,447 | $ | — | $ | 134,609,447 | ||||
| Corporate Bonds | — | 11,550,297 | — | 11,550,297 | ||||||||
| Variable & Floating Rate Notes | — | 219,548 | — | 219,548 | ||||||||
| Short-Term U.S. Government | ||||||||||||
| Agency Obligations | — | 9,998,490 | — | 9,998,490 | ||||||||
| Total Investments in Securities* | $ | — | $ | 156,377,782 | $ | — | $ | 156,377,782 |
| * | The Portfolio of Investments provides information on the industry categorization of loan |
| participations, corporate bonds and variable and floating rate notes. | |
| There were no transfers into or from Level 1 and Level 2 by the Fund for the period ended March 31, | |
| 2017. Transfers, if any, between Levels are recognized at the end of the reporting period. |
| 26 | See notes to financial statements |
Fund Expenses (unaudited)
FUND FOR INCOME
The examples below show the ongoing costs (in dollars) of investing in your Fund and will help you in comparing these costs with costs of other mutual funds. Please refer to page 6 for a detailed explanation of the information presented in these examples.
| Annualized | Beginning | Ending | Expenses Paid | |
| Expense | Account Value | Account Value | During Period | |
| Expense Example | Ratio | (10/1/16) | (3/31/17) | (10/1/16–3/31/17)* |
| Class A Shares | 1.21% | |||
| Actual | $1,000.00 | $1,028.59 | $6.12 | |
| Hypothetical** | $1,000.00 | $1,018.90 | $6.04 | |
| Class B Shares | 1.96% | |||
| Actual | $1,000.00 | $1,023.65 | $9.89 | |
| Hypothetical** | $1,000.00 | $1,015.16 | $9.80 | |
| Advisor Class Shares | 0.94% | |||
| Actual | $1,000.00 | $1,029.86 | $4.76 | |
| Hypothetical** | $1,000.00 | $1,020.24 | $4.73 | |
| Institutional Class Shares | 0.79% | |||
| Actual | $1,000.00 | $1,031.00 | $4.00 | |
| Hypothetical** | $1,000.00 | $1,020.99 | $3.93 |
| * | Expenses are equal to the annualized expense ratio, multiplied by the average account value over |
| the period, multiplied by 182/365 (to reflect the one-half year period). Expenses paid during the | |
| period are net of expenses waived. | |
| ** | Assumed rate of return of 5% before expenses. |
| Portfolio holdings and allocations are subject to change. Percentages are as of March 31, 2017, and |
| are based on the total market value of investments. |
| 27 |
Portfolio of Investments
FUND FOR INCOME
March 31, 2017
| Principal | |||
| Amount | Security | Value | |
| CORPORATE BONDS—91.7% | |||
| Aerospace/Defense—1.3% | |||
| Bombardier, Inc.: | |||
| $2,600M | 8.75%, 12/1/2021 (a) | $ 2,853,500 | |
| 1,675M | 7.5%, 3/15/2025 (a) | 1,721,062 | |
| Meccanica Holdings USA, Inc.: | |||
| 1,871M | 7.375%, 7/15/2039 (a) | 2,132,940 | |
| 750M | 6.25%, 1/15/2040 (a) | 796,875 | |
| 1,725M | Transdigm, Inc., 6.375%, 6/15/2026 | 1,730,330 | |
| 9,234,707 | |||
| Automotive—4.9% | |||
| American Axle & Manufacturing, Inc.: | |||
| 125M | 6.625%, 10/15/2022 | 129,375 | |
| 1,475M | 6.25%, 4/1/2025 (a) | 1,480,531 | |
| 1,175M | 6.5%, 4/1/2027 (a) | 1,174,260 | |
| 1,725M | Asbury Automotive Group, Inc., 6%, 12/15/2024 | 1,789,687 | |
| 1,700M | Avis Budget Car Rental, 6.375%, 4/1/2024 (a) | 1,710,625 | |
| 1,900M | Cooper-Standard Automotive, Inc., 5.625%, 11/15/2026 (a) | 1,904,750 | |
| Dana Holding Corp.: | |||
| 2,000M | 6%, 9/15/2023 | 2,095,000 | |
| 700M | 5.5%, 12/15/2024 | 712,250 | |
| 2,350M | Fiat Chrysler Automobiles NV, 5.25%, 4/15/2023 | 2,428,725 | |
| Group 1 Automotive, Inc.: | |||
| 2,375M | 5%, 6/1/2022 | 2,404,687 | |
| 1,425M | 5.25%, 12/15/2023 (a) | 1,446,375 | |
| 1,975M | Hertz Corp., 5.5%, 10/15/2024 (a) | 1,725,656 | |
| IHO Verwaltungs GmbH: | |||
| 1,075M | 4.125%, 9/15/2021 (a) | 1,083,063 | |
| 550M | 4.5%, 9/15/2023 (a) | 545,188 | |
| 3,650M | LKQ Corp., 4.75%, 5/15/2023 | 3,650,000 | |
| 3,725M | Meritor, Inc., 6.25%, 2/15/2024 | 3,836,750 | |
| 3,050M | Omega U.S. Sub, LLC, 8.75%, 7/15/2023 (a) | 3,250,782 | |
| 2,550M | ZF North America Capital, Inc., 4.75%, 4/29/2025 (a) | 2,648,813 | |
| 34,016,517 | |||
| Building Materials—1.0% | |||
| 2,600M | Building Materials Corp., 5.375%, 11/15/2024 (a) | 2,647,112 | |
| 4,200M | Griffon Corp., 5.25%, 3/1/2022 | 4,215,750 | |
| 6,862,862 |
| 28 |
| Principal | |||
| Amount | Security | Value | |
| Chemicals—4.4% | |||
| $2,000M | A. Schulman, Inc., 6.875%, 6/1/2023 | $ 2,085,000 | |
| 2,700M | Blue Cube Spinco, Inc., 10%, 10/15/2025 | 3,273,750 | |
| 1,900M | Koppers, Inc., 6%, 2/15/2025 (a) | 1,966,500 | |
| 3,100M | Platform Specialty Products Corp., 10.375%, 5/1/2021 (a) | 3,456,500 | |
| 3,425M | PolyOne Corp., 5.25%, 3/15/2023 | 3,467,813 | |
| Rain CII Carbon, LLC: | |||
| 3,225M | 8.25%, 1/15/2021 (a) | 3,341,906 | |
| 6,725M | 7.25%, 4/1/2025 (a) | 6,674,563 | |
| 1,350M | Rayonier AM Products, Inc., 5.5%, 6/1/2024 (a) | 1,221,750 | |
| 1,350M | TPC Group, Inc., 8.75%, 12/15/2020 (a) | 1,235,520 | |
| Tronox Finance, LLC: | |||
| 2,200M | 6.375%, 8/15/2020 | 2,219,250 | |
| 1,000M | 7.5%, 3/15/2022 (a) | 1,040,000 | |
| 525M | W.R. Grace & Co., 5.625%, 10/1/2024 (a) | 555,187 | |
| 30,537,739 | |||
| Consumer Non-Durables—.9% | |||
| Reynolds Group Issuer, Inc.: | |||
| 1,800M | 5.75%, 10/15/2020 | 1,854,018 | |
| 850M | 5.125%, 7/15/2023 (a) | 874,438 | |
| 1,375M | Standard Industries, Inc., 5.5%, 2/15/2023 (a) | 1,409,375 | |
| 2,275M | Wolverine World Wide, Inc., 5%, 9/1/2026 (a) | 2,144,188 | |
| 6,282,019 | |||
| Energy—11.3% | |||
| 1,425M | Alta Mesa Holdings, LP, 7.875%, 12/15/2024 (a) | 1,492,687 | |
| Antero Resources Corp.: | |||
| 950M | 5.375%, 11/1/2021 | 979,298 | |
| 475M | 5.125%, 12/1/2022 | 483,609 | |
| 400M | 5%, 3/1/2025 (a) | 394,248 | |
| 1,725M | Baytex Energy Corp., 5.125%, 6/1/2021 (a) | 1,565,437 | |
| 1,375M | Blue Racer Midstream, LLC, 6.125%, 11/15/2022 (a) | 1,399,062 | |
| 425M | Callon Petroleum Co., 6.125%, 10/1/2024 (a) | 444,125 | |
| 1,600M | Carrizo Oil & Gas, Inc., 6.25%, 4/15/2023 | 1,612,000 | |
| 1,425M | Cheniere Corpus Christi Holdings, 7%, 6/30/2024 (a) | 1,576,406 | |
| Continental Resources, Inc.: | |||
| 1,150M | 4.5%, 4/15/2023 | 1,124,838 | |
| 3,575M | 3.8%, 6/1/2024 | 3,342,625 | |
| 475M | 4.9%, 6/1/2044 | 410,875 |
| 29 |
Portfolio of Investments (continued)
FUND FOR INCOME
March 31, 2017
| Principal | |||
| Amount | Security | Value | |
| Energy (continued) | |||
| Crestwood Midstream Partners, LP: | |||
| $2,175M | 6.25%, 4/1/2023 | $ 2,267,437 | |
| 1,375M | 5.75%, 4/1/2025 (a) | 1,407,656 | |
| 500M | Diamondback Energy, Inc., 4.75%, 11/1/2024 (a) | 505,450 | |
| 2,767M | Exterran Partners, LP, 6%, 10/1/2022 | 2,739,330 | |
| 1,950M | Forum Energy Technologies, Inc., 6.25%, 10/1/2021 | 1,930,500 | |
| Genesis Energy, LP: | |||
| 1,400M | 6.75%, 8/1/2022 | 1,450,400 | |
| 225M | 6%, 5/15/2023 | 227,250 | |
| 500M | 5.625%, 6/15/2024 | 491,250 | |
| 1,150M | Gulfport Energy Corp., 6.375%, 5/15/2025 (a) | 1,134,187 | |
| 2,125M | Hilcorp Energy I, 5.75%, 10/1/2025 (a) | 2,061,250 | |
| 2,600M | Laredo Petroleum, Inc., 5.625%, 1/15/2022 | 2,606,500 | |
| 1,400M | Matador Resources Co., 6.875%, 4/15/2023 | 1,470,000 | |
| 1,900M | MEG Energy Corp., 6.5%, 1/15/2025 (a) | 1,907,125 | |
| Murphy Oil Corp.: | |||
| 1,425M | 4.7%, 12/1/2022 | 1,389,375 | |
| 1,225M | 6.875%, 8/15/2024 | 1,301,563 | |
| 3,300M | Newfield Exploration Co., 5.375%, 1/1/2026 | 3,463,020 | |
| 325M | NuStar Logistics, LP, 4.8%, 9/1/2020 | 330,493 | |
| 1,750M | Oasis Petroleum, Inc., 6.5%, 11/1/2021 | 1,763,125 | |
| 425M | Parsley Energy, LLC, 6.25%, 6/1/2024 (a) | 452,625 | |
| 1,400M | Pattern Energy Group, Inc., 5.875%, 2/1/2024 (a) | 1,424,500 | |
| 575M | PDC Energy, Inc., 6.125%, 9/15/2024 (a) | 592,250 | |
| 1,700M | Precision Drilling Corp., 6.5%, 12/15/2021 | 1,704,624 | |
| 2,075M | QEP Resources, Inc., 6.875%, 3/1/2021 | 2,215,063 | |
| 1,651M | Range Resources Corp., 5%, 8/15/2022 (a) | 1,642,745 | |
| 1,650M | Rice Energy, Inc., 6.25%, 5/1/2022 | 1,707,750 | |
| 1,250M | Rowan Companies, Inc., 4.875%, 6/1/2022 | 1,200,000 | |
| 700M | RSP Permian, Inc., 5.25%, 1/15/2025 (a) | 708,750 | |
| Sabine Pass Liquefaction, LLC: | |||
| 1,600M | 6.25%, 3/15/2022 | 1,777,467 | |
| 925M | 5.625%, 4/15/2023 | 1,004,778 | |
| 2,625M | 5.75%, 5/15/2024 | 2,864,807 | |
| 650M | 5.875%, 6/30/2026 (a) | 717,920 | |
| 425M | 5%, 3/15/2027 (a) | 445,139 | |
| Southwestern Energy Co.: | |||
| 775M | 5.8%, 1/23/2020 | 786,141 | |
| 1,025M | 6.7%, 1/23/2025 | 1,014,750 | |
| 700M | Suburban Propane Partners, LP, 5.875%, 3/1/2027 | 693,000 |
| 30 |
| Principal | |||
| Amount | Security | Value | |
| Energy (continued) | |||
| Sunoco, LP: | |||
| $1,100M | 6.25%, 4/15/2021 | $ 1,124,750 | |
| 900M | 6.375%, 4/1/2023 | 918,000 | |
| Targa Resources Partners, LP: | |||
| 900M | 5.25%, 5/1/2023 | 924,750 | |
| 2,800M | 4.25%, 11/15/2023 | 2,751,000 | |
| 1,150M | 5.125%, 2/1/2025 (a) | 1,188,813 | |
| Tesoro Logistics, LP: | |||
| 1,650M | 6.25%, 10/15/2022 | 1,751,063 | |
| 825M | 6.375%, 5/1/2024 | 897,188 | |
| 1,550M | Unit Corp., 6.625%, 5/15/2021 | 1,534,500 | |
| Weatherford Bermuda, PLC: | |||
| 600M | 4.5%, 4/15/2022 | 577,500 | |
| 625M | 6.5%, 8/1/2036 | 593,750 | |
| 1,725M | WPX Energy, Inc., 6%, 1/15/2022 | 1,763,813 | |
| 78,248,557 | |||
| Financials—3.9% | |||
| Ally Financials, Inc.: | |||
| 1,300M | 8%, 12/31/2018 | 1,407,250 | |
| 3,100M | 8%, 3/15/2020 | 3,487,500 | |
| 4,250M | 8%, 11/1/2031 | 5,068,125 | |
| 1,875M | Argos Merger Sub, Inc., 7.125%, 3/15/2023 (a) | 1,785,937 | |
| 1,200M | BCD Acquisition, Inc., 9.625%, 9/15/2023 (a) | 1,302,000 | |
| 525M | CDW, LLC, 5%, 9/1/2025 | 538,125 | |
| 3,466M | Consolidated Energy Finance SA, 6.75%, 10/15/2019 (a) | 3,509,325 | |
| 1,700M | CVR Partners, LP, 9.25%, 6/15/2023 (a) | 1,751,000 | |
| 1,000M | Dana Financing Luxembourg Sarl, 6.5%, 6/1/2026 (a) | 1,045,000 | |
| Icahn Enterprises, LP: | |||
| 250M | 6%, 8/1/2020 | 260,000 | |
| 1,325M | 6.25%, 2/1/2022 (a) | 1,348,187 | |
| 2,700M | 6.75%, 2/1/2024 (a) | 2,791,125 | |
| 1,350M | Ladder Capital Finance Holdings, 5.25%, 3/15/2022 (a) | 1,363,500 | |
| Park Aerospace Holdings, Ltd.: | |||
| 600M | 5.25%, 8/15/2022 (a) | 626,250 | |
| 725M | 5.5%, 2/15/2024 (a) | 755,813 | |
| 27,039,137 |
| 31 |
Portfolio of Investments (continued)
FUND FOR INCOME
March 31, 2017
| Principal | |||
| Amount | Security | Value | |
| Food/Beverage/Tobacco—1.2% | |||
| $1,225M | Barry Callebaut Services SA, 5.5%, 6/15/2023 (a) | $ 1,318,411 | |
| Lamb Weston Holdings, Inc.: | |||
| 875M | 4.625%, 11/1/2024 (a) | 894,687 | |
| 625M | 4.875%, 11/1/2026 (a) | 639,062 | |
| Post Holdings, Inc.: | |||
| 1,575M | 7.75%, 3/15/2024 (a) | 1,744,643 | |
| 1,725M | 5.5%, 3/1/2025 (a) | 1,742,250 | |
| 1,700M | Vector Group, Ltd., 6.125%, 2/1/2025 (a) | 1,740,375 | |
| 8,079,428 | |||
| Food/Drug—.6% | |||
| 1,000M | AdvancePierre Foods Holdings, 5.5%, 12/15/2024 (a) | 1,013,750 | |
| 1,350M | Albertson Cos., LLC, 5.75%, 3/15/2025 (a) | 1,312,875 | |
| 2,025M | Rite Aid Corp., 6.125%, 4/1/2023 (a) | 2,014,875 | |
| 4,341,500 | |||
| Forest Products/Containers—2.5% | |||
| Ardagh Packaging Finance, PLC: | |||
| 2,175M | 6%, 6/30/2021 (a) | 2,248,406 | |
| 525M | 4.625%, 5/15/2023 (a) | 530,906 | |
| 1,850M | Berry Plastics Group, 5.125%, 7/15/2023 | 1,903,187 | |
| 425M | Flex Acquisition Co., Inc., 6.875%, 1/15/2025 (a) | 434,977 | |
| 775M | Louisiana-Pacific Corp., 4.875%, 9/15/2024 | 780,813 | |
| Mercer International, Inc.: | |||
| 1,400M | 7.75%, 12/1/2022 | 1,505,420 | |
| 1,175M | 6.5%, 2/1/2024 (a) | 1,180,875 | |
| Owens-Brockway Glass Container, Inc.: | |||
| 450M | 5%, 1/15/2022 (a) | 464,625 | |
| 625M | 5.875%, 8/15/2023 (a) | 662,500 | |
| 1,875M | 5.375%, 1/15/2025 (a) | 1,910,156 | |
| 450M | 6.375%, 8/15/2025 (a) | 481,781 | |
| Sealed Air Corp.: | |||
| 875M | 4.875%, 12/1/2022 (a) | 914,918 | |
| 2,025M | 5.25%, 4/1/2023 (a) | 2,136,375 | |
| 2,175M | 6.875%, 7/15/2033 (a) | 2,376,188 | |
| 17,531,127 |
| 32 |
| Principal | |||
| Amount | Security | Value | |
| Gaming/Leisure—2.6% | |||
| $ 775M | GLP Capital, LP, 5.375%, 4/15/2026 | $ 802,125 | |
| International Game Technology, PLC: | |||
| 225M | 5.625%, 2/15/2020 (a) | 236,250 | |
| 900M | 6.25%, 2/15/2022 (a) | 965,250 | |
| 1,350M | 6.5%, 2/15/2025 (a) | 1,444,500 | |
| 525M | Lions Gate Entertainment Corp., 5.875%, 11/1/2024 (a) | 547,313 | |
| 1,800M | NCL Corp., Ltd., 4.625%, 11/15/2020 (a) | 1,847,250 | |
| 1,775M | Regal Entertainment Group, 5.75%, 3/15/2022 | 1,857,094 | |
| 1,900M | Scientific Games International, Inc., 7%, 1/1/2022 (a) | 2,033,000 | |
| 1,125M | Silversea Cruise Finance Ltd., 7.25%, 2/1/2025 (a) | 1,186,875 | |
| 4,125M | Six Flags Entertainment Corp., 5.25%, 1/15/2021 (a) | 4,242,356 | |
| 2,900M | Viking Cruises, Ltd., 6.25%, 5/15/2025 (a) | 2,784,000 | |
| 17,946,013 | |||
| Health Care—8.2% | |||
| 1,775M | Centene Corp., 6.125%, 2/15/2024 | 1,910,344 | |
| CHS/Community Health Systems, Inc.: | |||
| 1,125M | 7.125%, 7/15/2020 | 1,035,000 | |
| 950M | 5.125%, 8/1/2021 | 942,875 | |
| 2,450M | 6.25%, 3/31/2023 | 2,502,062 | |
| DaVita HealthCare Partners, Inc.: | |||
| 1,875M | 5.75%, 8/15/2022 | 1,947,656 | |
| 1,775M | 5.125%, 7/15/2024 | 1,796,078 | |
| Endo Finance, LLC: | |||
| 1,350M | 7.25%, 1/15/2022 (a) | 1,282,500 | |
| 1,575M | 6%, 7/15/2023 (a) | 1,386,000 | |
| 375M | 6%, 2/1/2025 (a) | 321,562 | |
| Fresenius Medical Care U.S. Finance II, Inc.: | |||
| 1,150M | 5.625%, 7/31/2019 (a) | 1,220,437 | |
| 675M | 4.75%, 10/15/2024 (a) | 688,500 | |
| HCA, Inc.: | |||
| 3,025M | 6.5%, 2/15/2020 | 3,318,062 | |
| 3,300M | 6.25%, 2/15/2021 | 3,570,188 | |
| 175M | 7.5%, 2/15/2022 | 200,594 | |
| 2,425M | 5.875%, 5/1/2023 | 2,625,062 | |
| 375M | 5.375%, 2/1/2025 | 391,875 | |
| 2,400M | 5.875%, 2/15/2026 | 2,538,000 | |
| HealthSouth Corp.: | |||
| 1,150M | 5.125%, 3/15/2023 | 1,155,750 | |
| 1,325M | 5.75%, 11/1/2024 | 1,341,562 | |
| 1,225M | Kindred Healthcare, Inc., 8.75%, 1/15/2023 | 1,232,656 |
| 33 |
Portfolio of Investments (continued)
FUND FOR INCOME
March 31, 2017
| Principal | |||
| Amount | Security | Value | |
| Health Care (continued) | |||
| LifePoint Health, Inc.: | |||
| $2,900M | 5.875%, 12/1/2023 | $ 2,994,250 | |
| 1,175M | 5.375%, 5/1/2024 (a) | 1,197,913 | |
| Mallinckrodt Finance SB: | |||
| 1,125M | 5.75%, 8/1/2022 (a) | 1,114,313 | |
| 1,025M | 5.5%, 4/15/2025 (a) | 948,125 | |
| 2,925M | Molina Healthcare, Inc., 5.375%, 11/15/2022 | 3,047,470 | |
| 775M | MPH Acquisition Holdings, 7.125%, 6/1/2024 (a) | 835,159 | |
| 700M | RegionalCare Hospital Partners, 8.25%, 5/1/2023 (a) | 750,400 | |
| 2,275M | Tenet Healthcare Corp., 6%, 10/1/2020 | 2,411,500 | |
| 575M | Universal Health Services, Inc., 5%, 6/1/2026 (a) | 593,688 | |
| 675M | Universal Hospital Services, Inc., 7.625%, 8/15/2020 | 675,000 | |
| Valeant Pharmaceuticals International, Inc.: | |||
| 5,200M | 6.375%, 10/15/2020 (a) | 4,732,000 | |
| 1,100M | 5.625%, 12/1/2021 (a) | 891,000 | |
| 400M | 6.5%, 3/15/2022 (a) | 412,500 | |
| 1,125M | 7%, 3/15/2024 (a) | 1,157,344 | |
| 4,600M | 6.125%, 4/15/2025 (a) | 3,559,250 | |
| 56,726,675 | |||
| Information Technology—4.4% | |||
| 1,350M | Alliance Data Systems Corp., 5.375%, 8/1/2022 (a) | 1,366,875 | |
| 2,892M | Belden, Inc., 5.5%, 9/1/2022 (a) | 2,964,300 | |
| 975M | CEB, Inc., 5.625%, 6/15/2023 (a) | 1,061,531 | |
| 2,200M | CommScope Technologies Finance, LLC, 6%, 6/15/2025 (a) | 2,315,500 | |
| 2,625M | Equinix, Inc., 5.875%, 1/15/2026 | 2,798,906 | |
| 2,414M | IAC/InterActiveCorp, 4.875%, 11/30/2018 | 2,448,399 | |
| Match Group, Inc.: | |||
| 350M | 6.75%, 12/15/2022 | 367,938 | |
| 825M | 6.375%, 6/1/2024 | 895,637 | |
| 1,850M | Micron Technology, Inc., 7.5%, 9/15/2023 (a) | 2,069,688 | |
| 1,050M | Microsemi Corp., 9.125%, 4/15/2023 (a) | 1,211,438 | |
| 1,250M | MSCI, Inc., 5.75%, 8/15/2025 (a) | 1,334,375 | |
| 1,375M | Nuance Communications, Inc., 6%, 7/1/2024 (a) | 1,426,563 | |
| NXP BV: | |||
| 675M | 4.125%, 6/1/2021 (a) | 702,000 | |
| 2,650M | 3.875%, 9/1/2022 (a) | 2,716,250 | |
| 1,300M | Open Text Corp., 5.625%, 1/15/2023 (a) | 1,358,500 |
| 34 |
| Principal | |||
| Amount | Security | Value | |
| Information Technology (continued) | |||
| $1,800M | Radiate Holdco, LLC, 6.625%, 2/15/2025 (a) | $ 1,780,875 | |
| 1,225M | Sensata Technologies BV, 6.25%, 2/15/2026 (a) | 1,304,625 | |
| 2,075M | Western Digital Corp., 10.5%, 4/1/2024 | 2,451,094 | |
| 30,574,494 | |||
| Manufacturing—3.7% | |||
| 1,225M | American Greetings Corp., 7.875%, 2/15/2025 (a) | 1,292,375 | |
| 2,300M | Amkor Technology, Inc., 6.375%, 10/1/2022 | 2,383,375 | |
| 2,450M | ATS Automation Tooling Systems, Inc., 6.5%, 6/15/2023 (a) | 2,566,375 | |
| 700M | Boise Cascade Co., 5.625%, 9/1/2024 (a) | 714,000 | |
| 2,775M | Brand Energy & Infrastructure Services, Inc., 8.5%, 12/1/2021 (a) | 2,934,562 | |
| 1,575M | Cloud Crane, LLC, 10.125%, 8/1/2024 (a) | 1,685,250 | |
| 2,550M | Gates Global, LLC, 6%, 7/15/2022 (a) | 2,607,375 | |
| 2,775M | Grinding Media, Inc., 7.375%, 12/15/2023 (a) | 2,920,687 | |
| 3,075M | H&E Equipment Services, Inc., 7%, 9/1/2022 | 3,240,281 | |
| United Rentals, Inc.: | |||
| 1,675M | 5.875%, 9/15/2026 | 1,752,469 | |
| 1,475M | 5.5%, 5/15/2027 | 1,493,438 | |
| 2,050M | Zekelman Industries, Inc., 9.875%, 6/15/2023 (a) | 2,296,000 | |
| 25,886,187 | |||
| Media-Broadcasting—2.3% | |||
| Belo Corp.: | |||
| 725M | 7.75%, 6/1/2027 | 788,437 | |
| 150M | 7.25%, 9/15/2027 | 159,750 | |
| 2,225M | LIN Television Corp., 5.875%, 11/15/2022 | 2,314,000 | |
| 3,250M | Nexstar Broadcasting, Inc., 6.125%, 2/15/2022 (a) | 3,396,250 | |
| 1,350M | Nexstar Escrow Corp., 5.625%, 8/1/2024 (a) | 1,373,625 | |
| Sinclair Television Group, Inc.: | |||
| 4,075M | 5.375%, 4/1/2021 | 4,176,875 | |
| 1,575M | 5.125%, 2/15/2027 (a) | 1,527,750 | |
| Sirius XM Radio, Inc.: | |||
| 1,425M | 5.75%, 8/1/2021 (a) | 1,482,369 | |
| 625M | 6%, 7/15/2024 (a) | 671,094 | |
| 15,890,150 |
| 35 |
Portfolio of Investments (continued)
FUND FOR INCOME
March 31, 2017
| Principal | |||
| Amount | Security | Value | |
| Media-Cable TV—9.4% | |||
| Altice Financing SA: | |||
| $2,525M | 6.625%, 2/15/2023 (a) | $ 2,634,837 | |
| 2,300M | 5.375%, 7/15/2023 (a) | 2,380,500 | |
| 970M | 8.125%, 1/15/2024 (a) | 1,042,750 | |
| 900M | 7.625%, 2/15/2025 (a) | 928,125 | |
| 1,000M | 5.5%, 5/15/2026 (a) | 1,030,000 | |
| 1,150M | 7.5%, 5/15/2026 (a) | 1,224,750 | |
| 1,250M | Block Communications, Inc., 6.875%, 2/15/2025 (a) | 1,328,125 | |
| 1,625M | Cable One, Inc., 5.75%, 6/15/2022 (a) | 1,694,062 | |
| CCO Holdings, LLC: | |||
| 2,950M | 5.125%, 2/15/2023 | 3,038,500 | |
| 3,675M | 5.875%, 4/1/2024 (a) | 3,886,312 | |
| 1,350M | 5.125%, 5/1/2027 (a)(b) | 1,360,125 | |
| 2,250M | 5.875%, 5/1/2027 (a) | 2,368,125 | |
| Cequel Communications Holdings I, LLC: | |||
| 4,525M | 6.375%, 9/15/2020 (a) | 4,672,062 | |
| 1,700M | 7.75%, 7/15/2025 (a) | 1,888,062 | |
| Clear Channel Worldwide Holdings, Inc. (Class “A”): | |||
| 200M | 7.625%, 3/15/2020 | 199,500 | |
| 750M | 6.5%, 11/15/2022 | 765,000 | |
| Clear Channel Worldwide Holdings, Inc. (Class “B”): | |||
| 2,250M | 7.625%, 3/15/2020 | 2,275,312 | |
| 2,375M | 6.5%, 11/15/2022 | 2,481,875 | |
| CSC Holdings, LLC: | |||
| 1,525M | 6.75%, 11/15/2021 | 1,657,484 | |
| 4,950M | 10.125%, 1/15/2023 (a) | 5,754,375 | |
| 1,250M | 6.625%, 10/15/2025 (a) | 1,362,500 | |
| 650M | 10.875%, 10/15/2025 (a) | 783,250 | |
| DISH DBS Corp.: | |||
| 4,125M | 7.875%, 9/1/2019 | 4,558,125 | |
| 950M | 5%, 3/15/2023 | 957,125 | |
| 1,750M | 5.875%, 11/15/2024 | 1,844,500 | |
| 725M | 7.75%, 7/1/2026 | 844,625 | |
| 2,400M | Gray Television, Inc., 5.875%, 7/15/2026 (a) | 2,448,000 | |
| 2,375M | Lynx II Corp., 6.375%, 4/15/2023 (a) | 2,487,813 | |
| Midcontinent Communications & Finance Corp.: | |||
| 1,000M | 6.25%, 8/1/2021 (a) | 1,045,000 | |
| 2,775M | 6.875%, 8/15/2023 (a) | 2,965,781 |
| 36 |
| Principal | |||
| Amount | Security | Value | |
| Media-Cable TV (continued) | |||
| Numericable Group SA: | |||
| $1,575M | 6%, 5/15/2022 (a) | $ 1,638,000 | |
| 1,800M | 6.25%, 5/15/2024 (a) | 1,818,000 | |
| 65,362,600 | |||
| Media-Diversified—1.4% | |||
| 1,675M | CBS Outdoor Americas Capital, 5.875%, 3/15/2025 | 1,760,844 | |
| 1,700M | Clearwater Paper Corp., 4.5%, 2/1/2023 | 1,657,500 | |
| 1,700M | Gannett Co., Inc., 5.125%, 7/15/2020 | 1,759,500 | |
| 625M | Lamar Media Corp., 5.75%, 2/1/2026 | 671,094 | |
| 975M | LSC Communication, Inc., 8.75%, 10/15/2023 (a) | 1,004,250 | |
| 2,775M | Tribune Co., 5.875%, 7/15/2022 | 2,906,813 | |
| 9,760,001 | |||
| Metals/Mining—5.7% | |||
| 2,025M | AK Steel Corp., 7%, 3/15/2027 | 2,026,255 | |
| Aleris International, Inc.: | |||
| 1,840M | 7.875%, 11/1/2020 | 1,826,200 | |
| 1,325M | 9.5%, 4/1/2021 (a) | 1,431,000 | |
| ArcelorMittal: | |||
| 1,431M | 10.6%, 6/1/2019 | 1,688,723 | |
| 1,875M | 6.125%, 6/1/2025 | 2,090,625 | |
| 1,125M | 7.75%, 10/15/2039 | 1,282,500 | |
| 325M | 7.5%, 3/1/2041 | 365,365 | |
| Arconic, Inc.: | |||
| 1,600M | 6.15%, 8/15/2020 | 1,736,000 | |
| 1,675M | 5.125%, 10/1/2024 | 1,738,650 | |
| 1,025M | 5.95%, 2/1/2037 | 1,027,562 | |
| 1,450M | Barminco Holdings Property, Ltd., 9%, 6/1/2018 (a) | 1,529,750 | |
| 3,400M | Cliffs Natural Resources, Inc., 5.75%, 3/1/2025 (a) | 3,315,000 | |
| 1,725M | Commercial Metals Co., 4.875%, 5/15/2023 | 1,768,125 | |
| 2,275M | First Quantum Minerals, Ltd., 7.25%, 5/15/2022 (a) | 2,357,469 | |
| Freeport-McMoRan, Inc.: | |||
| 1,800M | 3.1%, 3/15/2020 | 1,777,320 | |
| 1,400M | 5.45%, 3/15/2043 | 1,191,750 | |
| HudBay Minerals, Inc.: | |||
| 200M | 7.25%, 1/15/2023 (a) | 213,000 | |
| 450M | 7.625%, 1/15/2025 (a) | 490,500 | |
| 1,250M | Joseph T. Ryerson & Son, Inc., 11%, 5/15/2022 (a) | 1,409,375 |
| 37 |
Portfolio of Investments (continued)
FUND FOR INCOME
March 31, 2017
| Principal | |||
| Amount | Security | Value | |
| Metals/Mining (continued) | |||
| Novelis, Inc.: | |||
| $2,750M | 6.25%, 8/15/2024 (a) | $ 2,873,750 | |
| 2,625M | 5.875%, 9/30/2026 (a) | 2,687,344 | |
| Peabody Energy Corp.: | |||
| 325M | 6%, 3/31/2022 (a) | 324,391 | |
| 975M | 6.375%, 3/31/2025 (a) | 973,781 | |
| Teck Resources, Ltd.: | |||
| 850M | 8.5%, 6/1/2024 (a) | 982,813 | |
| 2,150M | 6%, 8/15/2040 | 2,176,875 | |
| 39,284,123 | |||
| Real Estate—2.5% | |||
| 1,500M | Care Capital Properties, LP, 5.125%, 8/15/2026 | 1,486,520 | |
| 1,950M | Dupont Fabros Technology, LP, 5.625%, 6/15/2023 | 2,032,875 | |
| Geo Group, Inc.: | |||
| 400M | 5.125%, 4/1/2023 | 399,000 | |
| 1,575M | 6%, 4/15/2026 | 1,602,914 | |
| Iron Mountain, Inc.: | |||
| 2,600M | 6%, 8/15/2023 | 2,749,500 | |
| 2,875M | 5.75%, 8/15/2024 | 2,946,875 | |
| Lennar Corp.: | |||
| 1,075M | 4.75%, 4/1/2021 | 1,126,062 | |
| 1,350M | 4.875%, 12/15/2023 | 1,387,125 | |
| MPT Operating Partnership, LP: | |||
| 375M | 6.375%, 3/1/2024 | 405,000 | |
| 875M | 5.25%, 8/1/2026 | 866,250 | |
| 1,100M | Realogy Group/Co-Issuer, 5.25%, 12/1/2021 (a) | 1,149,500 | |
| 1,325M | Starwood Property Trust, Inc., 5%, 12/15/2021 (a) | 1,378,000 | |
| 17,529,621 | |||
| Retail-General Merchandise—2.9% | |||
| AmeriGas Partners, LP: | |||
| 775M | 5.625%, 5/20/2024 | 782,750 | |
| 2,400M | 5.5%, 5/20/2025 | 2,409,002 | |
| 1,825M | 5.875%, 8/20/2026 | 1,825,000 | |
| 750M | 5.75%, 5/20/2027 | 744,187 | |
| KFC Holding Co.: | |||
| 1,075M | 5%, 6/1/2024 (a) | 1,100,531 | |
| 1,975M | 5.25%, 6/1/2026 (a) | 2,014,500 |
| 38 |
| Principal | |||
| Amount | Security | Value | |
| Retail-General Merchandise (continued) | |||
| L Brands, Inc.: | |||
| $1,700M | 6.875%, 11/1/2035 | $ 1,649,000 | |
| 3,125M | 6.75%, 7/1/2036 | 2,993,125 | |
| 3,100M | Landry’s, Inc., 6.75%, 10/15/2024 (a) | 3,224,000 | |
| 1,200M | Netflix, Inc., 5.5%, 2/15/2022 | 1,281,000 | |
| 2,075M | ServiceMaster Global Holdings, Inc., 5.125%, 11/15/2024 (a) | 2,132,063 | |
| 20,155,158 | |||
| Services—2.6% | |||
| ADT Corp.: | |||
| 1,900M | 3.5%, 7/15/2022 | 1,828,750 | |
| 1,800M | 4.125%, 6/15/2023 | 1,728,000 | |
| AECOM: | |||
| 1,975M | 5.75%, 10/15/2022 | 2,081,156 | |
| 2,025M | 5.875%, 10/15/2024 | 2,161,687 | |
| 1,475M | 5.125%, 3/15/2027 (a) | 1,482,375 | |
| 1,475M | Aramark Services, Inc., 5.125%, 1/15/2024 | 1,550,594 | |
| 1,270M | Cimpress NV, 7%, 4/1/2022 (a) | 1,320,800 | |
| 1,725M | Monitronics International, Inc., 9.125%, 4/1/2020 | 1,676,493 | |
| 1,700M | Prime Security Services Borrower, LLC, 9.25%, 5/15/2023 (a) | 1,867,875 | |
| 1,850M | Reliance Intermediate Holdings, LP, 6.5%, 4/1/2023 (a) | 1,979,500 | |
| 17,677,230 | |||
| Telecommunications—4.0% | |||
| CenturyLink, Inc.: | |||
| 3,800M | 5.8%, 3/15/2022 | 3,933,000 | |
| 1,250M | 6.75%, 12/1/2023 | 1,307,812 | |
| 1,400M | Citizens Communications Co., 9%, 8/15/2031 | 1,211,000 | |
| Frontier Communications Corp.: | |||
| 525M | 7.125%, 1/15/2023 | 463,150 | |
| 3,225M | 11%, 9/15/2025 | 3,152,437 | |
| 2,623M | GCI, Inc., 6.75%, 6/1/2021 | 2,701,690 | |
| 1,575M | Qwest Corp., 7.25%, 9/15/2025 | 1,724,245 | |
| 2,300M | Telesat Canada, LLC, 8.875%, 11/15/2024 (a) | 2,524,250 | |
| Wind Acquisition Finance SA: | |||
| 2,000M | 4.75%, 7/15/2020 (a) | 2,042,500 | |
| 4,975M | 7.375%, 4/23/2021 (a) | 5,186,438 | |
| 1,825M | Windstream Services, LLC, 7.5%, 6/1/2022 | 1,788,500 | |
| 1,450M | Zayo Group, LLC, 5.75%, 1/15/2027 (a) | 1,533,085 | |
| 27,568,107 |
| 39 |
Portfolio of Investments (continued)
FUND FOR INCOME
March 31, 2017
| Principal | |||
| Amount | Security | Value | |
| Transportation—.8% | |||
| Fly Leasing, Ltd.: | |||
| $1,675M | 6.75%, 12/15/2020 | $ 1,760,844 | |
| 200M | 6.375%, 10/15/2021 | 206,500 | |
| 1,750M | Mobile Mini, Inc., 5.875%, 7/1/2024 | 1,811,250 | |
| 1,450M | XPO Logistics, Inc., 6.125%, 9/1/2023 (a) | 1,513,438 | |
| 5,292,032 | |||
| Utilities—4.3% | |||
| AES Corp.: | |||
| 2,525M | 7.375%, 7/1/2021 | 2,865,875 | |
| 1,225M | 5.5%, 3/15/2024 | 1,249,500 | |
| 1,075M | 6%, 5/15/2026 | 1,118,000 | |
| Calpine Corp.: | |||
| 1,100M | 5.375%, 1/15/2023 | 1,115,180 | |
| 600M | 5.75%, 1/15/2025 | 599,250 | |
| 2,325M | 5.25%, 6/1/2026 (a) | 2,371,500 | |
| Dynegy, Inc.: | |||
| 1,450M | 6.75%, 11/1/2019 | 1,497,125 | |
| 2,100M | 7.375%, 11/1/2022 | 2,084,250 | |
| 1,392M | FirstLight Hydro Generating, 8.812%, 10/15/2026 | 1,485,089 | |
| 416M | Indiantown Cogeneration Utilities, LP, 9.77%, 12/15/2020 | 449,467 | |
| 975M | InterGen NV, 7%, 6/30/2023 (a) | 877,500 | |
| NGL Energy Partners, LP: | |||
| 850M | 7.5%, 11/1/2023 (a) | 881,875 | |
| 1,650M | 6.125%, 3/1/2025 (a) | 1,608,750 | |
| NRG Energy, Inc.: | |||
| 525M | 6.25%, 7/15/2022 | 539,438 | |
| 1,800M | 7.25%, 5/15/2026 | 1,863,000 | |
| 2,825M | 6.625%, 1/15/2027 (a) | 2,832,063 | |
| 1,350M | NRG Yield, Inc., 5%, 9/15/2026 (a) | 1,319,625 | |
| 2,584M | NSG Holdings, LLC, 7.75%, 12/15/2025 (a) | 2,790,371 | |
| 2,075M | Talen Energy Supply, LLC, 4.625%, 7/15/2019 (a) | 2,126,875 | |
| 29,674,733 | |||
| Wireless Communications—4.9% | |||
| Hughes Satellite Systems Corp.: | |||
| 625M | 5.25%, 8/1/2026 (a) | 625,000 | |
| 950M | 6.625%, 8/1/2026 (a) | 973,750 | |
| Inmarsat Finance, PLC: | |||
| 775M | 4.875%, 5/15/2022 (a) | 771,125 | |
| 1,225M | 6.5%, 10/1/2024 (a) | 1,272,469 |
| 40 |
| Principal | |||
| Amount | Security | Value | |
| Wireless Communications (continued) | |||
| Intelsat Jackson Holdings SA: | |||
| $2,050M | 5.5%, 8/1/2023 | $ 1,701,500 | |
| 2,300M | 8%, 2/15/2024 (a) | 2,443,750 | |
| Level 3 Financing, Inc.: | |||
| 1,138M | 6.125%, 1/15/2021 | 1,179,252 | |
| 575M | 5.125%, 5/1/2023 | 589,375 | |
| 675M | 5.25%, 3/15/2026 | 680,062 | |
| 1,200M | SBA Communications Corp., 4.875%, 9/1/2024 (a) | 1,187,760 | |
| Sprint Communications, Inc.: | |||
| 1,450M | 9%, 11/15/2018 (a) | 1,582,313 | |
| 1,225M | 7%, 3/1/2020 (a) | 1,338,313 | |
| 4,200M | 7%, 8/15/2020 | 4,520,250 | |
| 4,350M | 6%, 11/15/2022 | 4,458,750 | |
| 2,675M | Sprint Corp., 7.875%, 9/15/2023 | 2,969,250 | |
| T-Mobile USA, Inc.: | |||
| 625M | 6.125%, 1/15/2022 | 661,719 | |
| 2,475M | 6%, 3/1/2023 | 2,648,993 | |
| 2,725M | 6.625%, 4/1/2023 | 2,914,878 | |
| 300M | 6.5%, 1/15/2024 | 324,750 | |
| 1,075M | 6%, 4/15/2024 | 1,148,906 | |
| 33,992,165 | |||
| Total Value of Corporate Bonds (cost $618,076,237) | 635,492,882 | ||
| LOAN PARTICIPATIONS†—4.9% | |||
| Building Materials—.3% | |||
| 2,177M | Builders FirstSource, Inc., 4%, 2/29/2024 | 2,176,911 | |
| Energy—.3% | |||
| 2,225M | Jonah Energy, LLC, 7.5%, 5/12/2021 | 2,113,750 | |
| Financials—.4% | |||
| 2,477M | Lightstone Generation, LLC, 5.539%, 1/30/2024 | 2,494,013 | |
| Health Care—.4% | |||
| CHS/Community Health Systems, Inc.: | |||
| 578M | 3.7976%, 12/31/2019 | 575,724 | |
| 1,064M | 4.0477%, 1/27/2021 | 1,051,674 | |
| 1,433M | ExamWorks Group, Inc., 4.25%, 7/27/2023 | 1,443,555 | |
| 3,070,953 | |||
| 41 |
Portfolio of Investments (continued)
FUND FOR INCOME
March 31, 2017
| Principal | |||||
| Amount | Security | Value | |||
| Information Technology—1.2% | |||||
| $1,990M | Dell International, LLC, 3.49%, 9/7/2023 | $ 2,001,206 | |||
| 1,678M | Global Payments, Inc., 3.4822%, 4/21/2023 | 1,691,016 | |||
| 3,322M | Quest Software U.S., 7% 10/31/2022 | 3,375,523 | |||
| 1,650M | Telenet Financing USD, LLC, 3.77%, 1/31/2025 | 1,650,000 | |||
| 8,717,745 | |||||
| Manufacturing—.1% | |||||
| 486M | Columbus McKinnon Corp., 4.1468%, 1/31/2024 | 490,815 | |||
| Media-CableTV—.3% | |||||
| 2,297M | CSC Holdings, LLC, 3.9428%, 10/11/2024 | 2,313,144 | |||
| Media-Diversified—.4% | |||||
| 2,504M | Tribune Media Co., 3.9822%, 12/27/2020 | 2,523,063 | |||
| Metals/Mining—.1% | |||||
| 775M | Peabody Energy Corp., 5.5%, 2/8/2022 (b) | 778,875 | |||
| Retail-General Merchandise—1.0% | |||||
| 3,450M | Bass Pro Group, LLC, 5.97039%, 12/15/2023 | 3,320,625 | |||
| 3,383M | Harbor Freight Tools USA, Inc., 4.2322%, 8/18/2023 | 3,383,000 | |||
| 6,703,625 | |||||
| Services—.1% | |||||
| 590M | Brickman Group, Ltd., LLC, 4.0008%, 12/18/2020 | 593,169 | |||
| Wireless Communications—.3% | |||||
| 1,850M | Intelsat Jackson Holdings, Ltd., 3.8873%, 6/30/2019 | 1,817,048 | |||
| Total Value of Loan Participations (cost $33,563,820) | 33,793,111 | ||||
| PASS-THROUGH CERTIFICATES—.6% | |||||
| Transportation | |||||
| 3,911M | American Airlines 13-2 B PTT, 5.6%, 1/15/2022 | ||||
| (cost $3,974,081) (a) | 4,047,931 | ||||
| Total Value of Investments (cost $655,614,138) | 97.2 | % | 673,333,924 | ||
| Other Assets, Less Liabilities | 2.8 | 19,651,796 | |||
| Net Assets | 100.0 | % | $692,985,720 | ||
| 42 |
| (a) | Security exempt from registration under Rule 144A of the Securities Act of 1933 (see Note 4). | |
| (b) | A portion or all of the security purchased on a when-issued or delayed delivery basis (see | |
| Note 1G). | ||
| † | Interest rates are determined and reset periodically. The interest rates above are the rates in effect | |
| at March 31, 2017 | ||
| Summary of Abbreviations: | ||
| PTT | Pass-Through Trust | |
| USD | United States Dollar | |
The Fund’s assets and liabilities are classified into the following three levels based on the inputs used to value the assets or liabilities:
| Level 1 — Unadjusted quoted prices in active markets for identical securities that the Fund has the ability to access. |
| Level 2 — Observable inputs other than quoted prices included in Level 1 that are observable for the asset or liability, either directly or indirectly. These inputs may include quoted prices for the identical instrument on an inactive market, prices for similar instruments, interest rates, prepayment speeds, credit risk, yield curves, default rates and similar data. |
| Level 3 — Unobservable inputs for the asset or liability, to the extent relevant observable inputs are not available, representing the Fund’s own assumption about the assumptions a market participant would use in valuing the asset or liability, and would be based on the best information available. |
The inputs methodology used for valuing securities are not necessarily an indication of the risk associated with investing in those securities. For example, U.S. Government securities are reflected as Level 2 because the inputs used to determine fair value may not always be quoted prices in an active market.
The following is a summary, by category of Level, of inputs used to value the Fund’s investments as of March 31, 2017:
| Level 1 | Level 2 | Level 3 | Total | |||||||||
| Corporate Bonds | $ | — | $ | 635,492,882 | $ | — | $ | 635,492,882 | ||||
| Loan Participations | — | 33,793,111 | — | 33,793,111 | ||||||||
| Pass-Through Certificates | — | 4,047,931 | — | 4,047,931 | ||||||||
| Total Investments in Securities* | $ | — | $ | 673,333,924 | $ | — | $ | 673,333,924 |
| * | The Portfolio of Investments provides information on the industry categorization of corporate bonds, |
| loan participations and pass-through certificates. | |
| There were no transfers into or from Level 1 and Level 2 by the Fund for the period ended March 31, | |
| 2017. Transfers, if any, between Levels are recognized at the end of the reporting period. |
| See notes to financial statements | 43 |
Fund Expenses (unaudited)
GOVERNMENT FUND
The examples below show the ongoing costs (in dollars) of investing in your Fund and will help you in comparing these costs with costs of other mutual funds. Please refer to page 6 for a detailed explanation of the information presented in these examples.
| Annualized | Beginning | Ending | Expenses Paid | |
| Expense | Account Value | Account Value | During Period | |
| Expense Example | Ratio | (10/1/16) | (3/31/17) | (10/1/16–3/31/17)* |
| Class A Shares | 1.10% | |||
| Actual | $1,000.00 | $ 969.83 | $5.40 | |
| Hypothetical** | $1,000.00 | $1,019.45 | $5.54 | |
| Class B Shares | 1.91% | |||
| Actual | $1,000.00 | $ 965.92 | $9.36 | |
| Hypothetical** | $1,000.00 | $1,015.41 | $9.60 | |
| Advisor Class Shares | 0.82% | |||
| Actual | $1,000.00 | $ 971.55 | $4.03 | |
| Hypothetical** | $1,000.00 | $1,020.84 | $4.13 | |
| Institutional Class Shares | 0.68% | |||
| Actual | $1,000.00 | $ 975.21 | $3.35 | |
| Hypothetical** | $1,000.00 | $1,021.54 | $3.43 |
| * | Expenses are equal to the annualized expense ratio, multiplied by the average account value over |
| the period, multiplied by 182/365 (to reflect the one-half year period). Expenses paid during the | |
| period are net of expenses waived. | |
| ** | Assumed rate of return of 5% before expenses. |
| Portfolio holdings and allocations are subject to change. Percentages are as of March 31, 2017, and |
| are based on the total market value of investments. |
| 44 |
Portfolio of Investments
GOVERNMENT FUND
March 31, 2017
| Principal | |||
| Amount | Security | Value | |
| RESIDENTIAL MORTGAGE-BACKED | |||
| SECURITIES—50.3% | |||
| Fannie Mae—35.5% | |||
| $ 4,600M | 2.5%, 4/19/2032 (a) | $ 4,602,516 | |
| 34,693M | 3%, 12/1/2028 – 6/1/2046 | 34,876,776 | |
| 28,026M | 3.5%, 4/1/2033 – 4/1/2046 | 28,875,274 | |
| 31,831M | 4%, 8/1/2026 – 11/1/2045 (a) | 33,580,963 | |
| 6,653M | 4.5%, 11/1/2040 – 1/1/2042 | 7,235,118 | |
| 2,144M | 5%, 8/1/2039 – 11/1/2039 | 2,361,767 | |
| 1,906M | 5.5%, 7/1/2033 – 10/1/2039 | 2,148,659 | |
| 113,681,073 | |||
| Freddie Mac—2.1% | |||
| 342M | 3%, 6/1/2021 | 351,517 | |
| 5,043M | 3.5%, 9/1/2032 – 2/1/2046 | 5,194,277 | |
| 1,197M | 5%, 8/1/2039 | 1,334,401 | |
| 6,880,195 | |||
| Government National Mortgage Association I | |||
| Program—12.7% | |||
| 1,393M | 4%, 11/15/2025 – 6/15/2042 | 1,493,057 | |
| 7,550M | 4.5%, 9/15/2033 – 6/15/2040 | 8,169,292 | |
| 8,604M | 5%, 6/15/2033 – 4/15/2040 | 9,569,535 | |
| 8,491M | 5.5%, 3/15/2033 – 10/15/2039 | 9,663,125 | |
| 8,707M | 6%, 2/15/2032 – 4/15/2040 | 10,105,475 | |
| 1,443M | 7%, 6/15/2023 – 4/15/2034 | 1,558,259 | |
| 40,558,743 | |||
| Total Value of Residential Mortgage-Backed Securities (cost $159,885,572) | 161,120,011 | ||
| U.S. GOVERNMENT OBLIGATIONS—16.9% | |||
| U.S. Treasury Bonds: | |||
| 4,530M | 2.5%, 5/15/2046 | 4,057,181 | |
| 6,800M | 3%, 2/15/2047 | 6,777,023 | |
| 45 |
Portfolio of Investments (continued)
GOVERNMENT FUND
March 31, 2017
| Principal | |||
| Amount | Security | Value | |
| U.S. GOVERNMENT OBLIGATIONS (continued) | |||
| U.S. Treasury Notes: | |||
| $ 5,000M | 0.125%, 4/15/2021 (TIPS) | $ 5,179,234 | |
| 6,000M | 0.375%, 1/15/2027 (TIPS) | 6,009,090 | |
| 2,000M | 1.125%, 8/31/2021 | 1,937,852 | |
| 13,230M | 1.375%, 10/31/2020 | 13,087,103 | |
| 5,100M | 1.5%, 3/31/2023 | 4,924,790 | |
| 5,050M | 1.625%, 2/15/2026 | 4,748,874 | |
| 7,310M | 1.875%, 8/31/2022 | 7,255,175 | |
| Total Value of U.S. Government Obligations (cost $54,777,624) | 53,976,322 | ||
| COMMERCIAL MORTGAGE-BACKED | |||
| SECURITIES—13.6% | |||
| Fannie Mae—10.3% | |||
| 2,767M | 2.27%, 1/1/2023 | 2,743,019 | |
| 5,500M | 2.369%, 7/25/2026 | 5,247,913 | |
| 4,800M | 2.49935%, 9/25/2026 | 4,597,027 | |
| 1,300M | 2.96%, 11/1/2018 | 1,322,684 | |
| 4,367M | 2.996%, 11/1/2022 | 4,471,029 | |
| 6,900M | 3.34%, 2/1/2027 | 7,195,568 | |
| 2,805M | 3.76%, 4/1/2018 | 2,841,564 | |
| 4,500M | 3.84%, 5/1/2018 | 4,575,438 | |
| 32,994,242 | |||
| Federal Home Loan Mortgage Corporation—3.3% | |||
| Multi-Family Structured Pass-Through: | |||
| 1,830M | 2.454%, 8/25/2023 | 1,826,131 | |
| 4,330M | 2.849%, 3/25/2026 | 4,297,131 | |
| 4,700M | 3.08%, 1/25/2031 | 4,610,329 | |
| 10,733,591 | |||
| Total Value of Commercial Mortgage-Backed Securities (cost $45,599,570) | 43,727,833 | ||
| 46 |
| Principal | |||||
| Amount | Security | Value | |||
| U.S. GOVERNMENT AGENCY | |||||
| OBLIGATIONS—6.3% | |||||
| Fannie Mae: | |||||
| $ 4,600M | 1.125%, 7/20/2018 | $ 4,597,695 | |||
| 1,700M | 1.375%, 2/26/2021 | 1,671,015 | |||
| 4,300M | 1.875%, 9/18/2018 | 4,342,484 | |||
| 4,750M | 1.875%, 9/24/2026 | 4,421,139 | |||
| 5,000M | Freddie Mac, 3.75%, 3/27/2019 | 5,236,355 | |||
| Total Value of U.S. Government Agency Obligations (cost $20,807,456) | 20,268,688 | ||||
| COLLATERALIZED MORTGAGE | |||||
| OBLIGATIONS—4.6% | |||||
| Fannie Mae: | |||||
| 6,425M | 3%, 10/25/2042 | 6,578,855 | |||
| 5,861M | 4%, 2/25/2025 | 6,224,894 | |||
| 1,816M | Freddie Mac, 3%, 8/15/2039 | 1,856,789 | |||
| Total Value of Collateralized Mortgage Obligations (cost $15,013,032) | 14,660,538 | ||||
| TAXABLE MUNICIPAL BONDS—2.7% | |||||
| 4,000M | Ford Foundation, 3.859%, 6/1/2047 | 4,045,672 | |||
| 4,500M | New York State Urban Dev. Corp., 3.27%, 3/15/2027 | 4,526,865 | |||
| Total Value of Taxable Municipal Bonds (cost $8,532,415) | 8,572,537 | ||||
| COVERED BONDS—1.8% | |||||
| Financial Services | |||||
| 5,700M | Toronto-Dominion Bank, 2.5%, 1/18/2022 (cost $5,687,183) (b) | 5,713,845 | |||
| SHORT-TERM U.S. GOVERNMENT AGENCY | |||||
| OBLIGATIONS—5.5% | |||||
| Federal Home Loan Bank: | |||||
| 7,500M | 0.7%, 4/11/2017 | 7,498,868 | |||
| 10,000M | 0.75%, 4/25/2017 | 9,995,840 | |||
| Total Value of Short-Term U.S. Government | |||||
| Agency Obligations (cost $17,493,541) | 17,494,708 | ||||
| Total Value of Investments (cost $327,796,393) | 101.7 | % | 325,534,482 | ||
| Excess of Liabilities Over Other Assets | (1.7 | ) | (5,470,999) | ||
| Net Assets | 100.0 | % | $320,063,483 | ||
| 47 |
Portfolio of Investments (continued)
GOVERNMENT FUND
March 31, 2017
| (a) | A portion or all of the security purchased on a when-issued or delayed delivery basis. | |
| (b) | Security exempt from registration under Rule 144A of the Securities Act of 1933 (see Note 4). | |
| Summary of Abbreviations: | ||
| TIPS | Treasury Inflation-Protected Securities | |
The Fund’s assets and liabilities are classified into the following three levels based on the inputs used to value the assets or liabilities:
| Level 1 — Unadjusted quoted prices in active markets for identical securities that the Fund has the ability to access. |
| Level 2 — Observable inputs other than quoted prices included in Level 1 that are observable for the asset or liability, either directly or indirectly. These inputs may include quoted prices for the identical instrument on an inactive market, prices for similar instruments, interest rates, prepayment speeds, credit risk, yield curves, default rates and similar data. |
| Level 3 — Unobservable inputs for the asset or liability, to the extent relevant observable inputs are not available, representing the Fund’s own assumption about the assumptions a market participant would use in valuing the asset or liability, and would be based on the best information available. |
The inputs methodology used for valuing securities are not necessarily an indication of the risk associated with investing in those securities. For example, U.S. Government securities are reflected as Level 2 because the inputs used to determine fair value may not always be quoted prices in an active market.
The following is a summary, by category of Level, of inputs used to value the Fund’s investments as of March 31, 2017:
| Level 1 | Level 2 | Level 3 | Total | |||||||||
| Residential Mortgage-Backed | ||||||||||||
| Securities | $ | — | $ | 161,120,011 | $ | — | $ | 161,120,011 | ||||
| U.S. Government Obligations | — | 53,976,322 | — | 53,976,322 | ||||||||
| Commercial Mortgage-Backed | ||||||||||||
| Securities | — | 43,727,833 | — | 43,727,833 | ||||||||
| U.S. Government Agency | ||||||||||||
| Obligations | — | 20,268,688 | — | 20,268,688 | ||||||||
| Collateralized Mortgage | ||||||||||||
| Obligations | — | 14,660,538 | — | 14,660,538 | ||||||||
| Taxable Municipal Bonds | — | 8,572,537 | — | 8,572,537 | ||||||||
| Covered Bonds | — | 5,713,845 | — | 5,713,845 | ||||||||
| Short-Term U.S. Government | ||||||||||||
| Agency Obligations | — | 17,494,708 | — | 17,494,708 | ||||||||
| Total Investments in Securities | $ | — | $ | 325,534,482 | $ | — | $ | 325,534,482 |
| There were no transfers into or from Level 1 and Level 2 by the Fund for the period ended March 31, |
| 2017. Transfers, if any, between Levels are recognized at the end of the reporting period. |
| 48 | See notes to financial statements |
Fund Expenses (unaudited)
GOVERNMENT CASH MANAGEMENT FUND
The examples below show the ongoing costs (in dollars) of investing in your Fund and will help you in comparing these costs with costs of other mutual funds. Please refer to page 6 for a detailed explanation of the information presented in these examples.
| Annualized | Beginning | Ending | Expenses Paid | |
| Expense | Account Value | Account Value | During Period | |
| Expense Example | Ratio | (10/1/16) | (3/31/17) | (10/1/16–3/31/17)* |
| Class A Shares | 0.47% | |||
| Actual | $1,000.00 | $1,000.00 | $2.34 | |
| Hypothetical** | $1,000.00 | $1,022.59 | $2.37 | |
| Class B Shares | 0.47% | |||
| Actual | $1,000.00 | $1,000.00 | $2.34 | |
| Hypothetical** | $1,000.00 | $1,022.59 | $2.37 | |
| Institutional Class Shares | 0.47% | |||
| Actual | $1,000.00 | $1,000.00 | $2.34 | |
| Hypothetical** | $1,000.00 | $1,022.59 | $2.37 |
| * | Expenses are equal to the annualized expense ratio, multiplied by the average account value over |
| the period, multiplied by 182/365 (to reflect the one-half year period). Expenses paid during the | |
| period are net of expenses waived and/or assumed. | |
| ** | Assumed rate of return of 5% before expenses. |
| Portfolio holdings and allocations are subject to change. Percentages are as of March 31, 2017, and |
| are based on the total market value of investments. |
| 49 |
Portfolio of Investments
GOVERNMENT CASH MANAGEMENT FUND
March 31, 2017
| Principal | Interest | ||||||
| Amount | Security | Rate | * | Value | |||
| U.S. GOVERNMENT AGENCY | |||||||
| OBLIGATIONS—24.9% | |||||||
| Federal Home Loan Bank: | |||||||
| $ 5,000M | 4/6/2017 | 0.53 | % | $ 4,999,632 | |||
| 7,000M | 4/10/2017 | 0.05 | 6,999,089 | ||||
| 6,800M | 4/12/2017 | 0.53 | 6,798,898 | ||||
| 8,000M | 4/18/2017 | 0.53 | 7,997,997 | ||||
| 6,740M | 5/19/2017 | 0.55 | 6,735,055 | ||||
| Total Value of U.S. Government Agency Obligations (cost $33,530,671) | 33,530,671 | ||||||
| VARIABLE AND FLOATING RATE NOTES—18.2% | |||||||
| Federal Farm Credit Bank: | |||||||
| 3,450M | 4/17/2017 | 0.99 | 3,450,281 | ||||
| 5,500M | 4/20/2017 | 1.03 | 5,500,058 | ||||
| Federal Home Loan Bank: | |||||||
| 7,000M | 7/17/2017 | 0.73 | 7,000,135 | ||||
| 3,500M | 9/5/2017 | 0.87 | 3,500,993 | ||||
| 5,000M | 10/20/2017 | 0.66 | 5,000,000 | ||||
| Total Value of Variable and Floating Rate Notes (cost $24,451,467) | 24,451,467 | ||||||
| SHORT-TERM U.S. GOVERNMENT | |||||||
| OBLIGATIONS—56.8% | |||||||
| U.S. Treasury Bills: | |||||||
| 8,000M | 4/20/2017 | 0.55 | 7,997,698 | ||||
| 4,000M | 4/27/2017 | 0.62 | 3,998,205 | ||||
| 6,000M | 4/27/2017 | 0.75 | 5,996,749 | ||||
| 8,500M | 5/4/2017 | 0.53 | 8,495,853 | ||||
| 3,000M | 5/11/2017 | 0.52 | 2,998,282 | ||||
| 6,500M | 5/25/2017 | 0.50 | 6,495,128 | ||||
| 7,000M | 5/25/2017 | 0.58 | 6,993,863 | ||||
| 7,000M | 5/25/2017 | 0.70 | 6,992,636 | ||||
| 4,000M | 6/8/2017 | 0.53 | 3,996,010 | ||||
| 3,000M | 7/13/2017 | 0.75 | 2,993,569 | ||||
| 4,500M | 7/20/2017 | 0.76 | 4,489,546 | ||||
| 7,000M | 8/17/2017 | 0.69 | 6,981,465 | ||||
| 8,000M | 8/17/2017 | 0.80 | 7,975,618 | ||||
| Total Value of Short-Term U.S. Government Obligations (cost $76,404,622) | 76,404,622 | ||||||
| Total Value of Investments (cost $134,386,760)** | 99.9 | % | 134,386,760 | ||||
| Other Assets, Less Liabilities | .1 | 140,573 | |||||
| Net Assets | 100.0 | % | $134,527,333 | ||||
| 50 |
| * | The interest rates shown are the effective rates at the time of purchase by the Fund. The interest |
| rates shown on floating rate notes are adjusted periodically; the rates shown are the rates in effect | |
| at March 31, 2017. | |
| ** | Aggregate cost for federal income tax purposes is the same. |
The Fund’s assets and liabilities are classified into the following three levels based on the inputs used to value the assets or liabilities:
| Level 1 — Unadjusted quoted prices in active markets for identical securities that the Fund has the ability to access. |
| Level 2 — Observable inputs other than quoted prices included in Level 1 that are observable for the asset or liability, either directly or indirectly. These inputs may include quoted prices for the identical instrument on an inactive market, prices for similar instruments, interest rates, prepayment speeds, credit risk, yield curves, default rates and similar data. |
| Level 3 — Unobservable inputs for the asset or liability, to the extent relevant observable inputs are not available, representing the Fund’s own assumption about the assumptions a market participant would use in valuing the asset or liability, and would be based on the best information available. |
The inputs methodology used for valuing securities are not necessarily an indication of the risk associated with investing in those securities. For example, U.S. Government securities are reflected as Level 2 because the inputs used to determine fair value may not always be quoted prices in an active market.
The following is a summary, by category of Level, of inputs used to value the Fund’s investments as of March 31, 2017:
| Level 1 | Level 2 | Level 3 | Total | |||||||||
| U.S. Government Agency | ||||||||||||
| Obligations | $ | — | $ | 33,530,671 | $ | — | $ | 33,530,671 | ||||
| Variable and Floating Rate Notes: | ||||||||||||
| U.S. Government Agency | ||||||||||||
| Obligations | — | 24,451,467 | — | 24,451,467 | ||||||||
| Short-Term U.S. Government | ||||||||||||
| Obligations | — | 76,404,622 | — | 76,404,622 | ||||||||
| Total Investments in Securities | $ | — | $ | 134,386,760 | $ | — | $ | 134,386,760 |
| There were no transfers into or from Level 1 or Level 2 by the Fund for the period ended March 31, |
| 2017. Transfers, if any, between Levels are recognized at the end of the reporting period. |
| See notes to financial statements | 51 |
Fund Expenses (unaudited)
INTERNATIONAL OPPORTUNITIES BOND FUND
The examples below show the ongoing costs (in dollars) of investing in your Fund and will help you in comparing these costs with costs of other mutual funds. Please refer to page 6 for a detailed explanation of the information presented in these examples.
| Annualized | Beginning | Ending | Expenses Paid | |
| Expense | Account Value | Account Value | During Period | |
| Expense Example | Ratio | (10/1/16) | (3/31/17) | (10/1/16–3/31/17)* |
| Class A Shares | 1.43% | |||
| Actual | $1,000.00 | $ 977.20 | $7.05 | |
| Hypothetical** | $1,000.00 | $1,017.80 | $7.19 | |
| Advisor Class Shares | 1.14% | |||
| Actual | $1,000.00 | $ 978.38 | $5.62 | |
| Hypothetical** | $1,000.00 | $1,019.25 | $5.74 | |
| Institutional Class Shares | 0.95% | |||
| Actual | $1,000.00 | $ 979.55 | $4.69 | |
| Hypothetical** | $1,000.00 | $1,020.19 | $4.78 |
| * | Expenses are equal to the annualized expense ratio, multiplied by the average account value over |
| the period, multiplied by 182/365 (to reflect the one-half year period). | |
| ** | Assumed rate of return of 5% before expenses. |
| Portfolio holdings and allocations are subject to change. Percentages are as of March 31, 2017, and |
| are based on the total market value of investments. |
| 52 |
Portfolio of Investments
INTERNATIONAL OPPORTUNITIES BOND FUND
March 31, 2017
| Principal | |||
| Amount | Security | Value | |
| SOVEREIGN BONDS—59.1% | |||
| Mexico—13.3% | |||
| United Mexican States: | |||
| 288M MXN | 7.75%, 11/23/2034 | $ 1,593,685 | |
| 1,180M MXN | 7.75%, 11/13/2042 | 6,526,469 | |
| 724M MXN | 8.5%, 5/31/2029 | 4,275,456 | |
| 760M MXN | 8.5%, 11/18/2038 | 4,522,654 | |
| 16,918,264 | |||
| Australia—8.3% | |||
| 3,765M AUD | New South Wales Treasury Corp., 5%, 8/20/2024 | 3,322,134 | |
| Queensland Treasury Corp.: | |||
| 3,535M AUD | 3.25%, 7/21/2026 | 2,733,169 | |
| 3,240M AUD | 4.75%, 7/21/2025 | 2,801,111 | |
| 1,905M AUD | 6%, 7/21/2022 | 1,704,312 | |
| 10,560,726 | |||
| Poland—5.9% | |||
| Republic of Poland: | |||
| 19,495M PLN | 3.25%, 7/25/2025 | 4,906,809 | |
| 9,720M PLN | 4%, 10/25/2023 | 2,586,926 | |
| 7,493,735 | |||
| Brazil—5.4% | |||
| Nota Do Tesouro Nacional: | |||
| 10M BRL | 10%, 1/1/2025 | 3,324,471 | |
| 11M BRL | 10%, 1/1/2027 | 3,539,532 | |
| 6,864,003 | |||
| Malaysia—5.2% | |||
| Federation of Malaysia: | |||
| 14,190M MYR | 3.48%, 3/15/2023 | 3,120,739 | |
| 1,750M MYR | 3.62%, 11/30/2021 | 391,309 | |
| 7,020M MYR | 3.659%, 10/15/2020 | 1,582,542 | |
| 6,540M MYR | 4.048%, 9/30/2021 | 1,491,218 | |
| 6,585,808 |
| 53 |
Portfolio of Investments (continued)
INTERNATIONAL OPPORTUNITIES BOND FUND
March 31, 2017
| Principal | |||
| Amount | Security | Value | |
| South Africa—5.1% | |||
| Republic of South Africa: | |||
| 46,785M ZAR | 6.5%, 2/28/2041 | $ 2,465,443 | |
| 14,655M ZAR | 6.75%, 3/31/2021 | 1,051,189 | |
| 43,490M ZAR | 8.75%, 2/28/2048 | 2,936,071 | |
| 6,452,703 | |||
| United Kingdom—4.4% | |||
| 4,430M GBP | United Kingdom Gilt, 1.25%, 7/22/2018 | 5,632,647 | |
| Indonesia—4.3% | |||
| Republic of Indonesia: | |||
| 52,000,000M IDR | 8.375%, 3/15/2034 | 4,144,235 | |
| 15,300,000M IDR | 9%, 3/15/2029 | 1,275,843 | |
| 5,420,078 | |||
| Portugal—3.8% | |||
| Obrigacoes Do Tesouro: | |||
| 1,185M EUR | 2.875%, 10/15/2025 | 1,218,093 | |
| 2,750M EUR | 4.10%, 4/15/2037 | 2,796,799 | |
| 645M EUR | 4.95%, 10/25/2023 | 771,355 | |
| 4,786,247 | |||
| Spain—1.3% | |||
| 1,090M EUR | Bonos Y Obligaciones Del Estado, 5.15%, 10/31/2044 | 1,676,199 | |
| New Zealand—1.2% | |||
| 1,800M NZD | New Zealand Government Bonds, 5.5%, 4/15/2023 | 1,451,129 | |
| 285,000M HUF | Hungary Government Bond, 6%, 11/24/2023 | 1,193,779 | |
| Total Value of Sovereign Bonds (cost $86,391,009) | 75,035,318 | ||
| U.S. GOVERNMENT OBLIGATIONS—16.9% | |||
| United States | |||
| 6,195M USD | U.S. Treasury Bonds, 2.875%, 11/15/2046 | 6,012,055 | |
| U.S. Treasury Notes: | |||
| 10,063M USD | 0.9215%, 1/31/2019 (a) | 10,072,248 | |
| 3,450M USD | 0.9515%, 10/31/2018 (a) | 3,455,517 | |
| 1,895M USD | 0.9555%, 7/31/2018 (a) | 1,898,449 | |
| Total Value of U.S. Government Obligations (cost $21,385,943) | 21,438,269 | ||
| 54 |
| Principal | |||
| Amount | Security | Value | |
| CORPORATE BONDS—10.6% | |||
| United States—8.8% | |||
| Apple, Inc.: | |||
| 930M USD | 4.5%, 2/23/2036 | $ 1,006,681 | |
| 2,140M USD | 4.65%, 2/23/2046 | 2,301,793 | |
| 1,650M USD | Citigroup, Inc., 1.8001%, 1/10/2020 | 1,656,183 | |
| 2,055M USD | Ford Motor Credit Co., LLC, 2.0093%, 1/9/2020 | 2,077,796 | |
| 1,505M USD | HP Enterprise Co., 6.35%, 10/15/2045 | 1,554,921 | |
| 735M USD | JP Morgan Chase Bank NA, 1.6018%, 9/21/2018 (a) | 737,416 | |
| 1,760M USD | Wells Fargo & Co., 2.0568%, 7/26/2021 (a) | 1,782,223 | |
| 11,117,013 | |||
| Australia—.8% | |||
| 1,030M USD | Macquarie Group, Ltd., 1.6618%, 10/27/2017 (a)(b) | 1,033,143 | |
| New Zealand—.4% | |||
| 470M USD | ANZ New Zealand International, Ltd. of London, 1.5573%, | ||
| 4/27/2017 (a)(b) | 470,149 | ||
| Netherlands—.3% | |||
| 420M USD | Shell International Finance BV, 4.55%, 8/12/2043 | 437,053 | |
| United Kingdom—.3% | |||
| 380M USD | BP Capital Markets, PLC, 3.506%, 3/17/2025 | 382,745 | |
| Total Value of Corporate Bonds (cost $13,132,468) | 13,440,103 | ||
| GOVERNMENT REGIONAL AGENCY—3.1% | |||
| Norway—1.5% | |||
| 1,872M USD | Kommunalbanken AS, 1.4673%, 6/16/2020 (a)(b) | 1,887,068 | |
| South Korea—.8% | |||
| 1,010M USD | Export-Import Bank of Korea, 1.6612%, 8/14/2017 (a)(b) | 1,009,478 | |
| Netherlands—.8% | |||
| 974M USD | Bank Nederlandse Gemeenteen, 1.0932%, 7/14/2017 (a)(b) | 974,075 | |
| Total Value of Government Regional Agency (cost $3,866,595) | 3,870,621 | ||
| 55 |
Portfolio of Investments (continued)
INTERNATIONAL OPPORTUNITIES BOND FUND
March 31, 2017
| Principal | |||||
| Amount | Security | Value | |||
| SUPRANATIONALS—1.2% | |||||
| Venezuela—.8% | |||||
| 1,075M USD | Corp. Andina De Fomento, 2%, 5/10/2019 | $ 1,073,653 | |||
| Luxembourg—.4% | |||||
| 515M USD | European Investment Bank, 1.125%, 9/15/2017 | 515,020 | |||
| Total Value of Supranational (cost $1,589,720) | 1,588,673 | ||||
| GOVERNMENT GUARANTEED | |||||
| PROGRAM—1.1% | |||||
| France | |||||
| 1,400M USD | Dexia Credit Local SA NY, 1.3%, 6/5/2018 | ||||
| (cost $1,400,000) (a)(b) | 1,396,923 | ||||
| Total Value of Investments (cost $127,765,735) | 92.0 | % | 116,769,907 | ||
| Other Assets, Less Liabilities | 8.0 | 10,121,997 | |||
| Net Assets | 100.0 | % | $126,891,904 | ||
| (a) | Interest rates are determined and reset periodically. The interest rates above are the rates in effect | |
| at March 31, 2017. | ||
| (b) | Security exempt from registration under Rule 144A of the Securities Act of 1933 (see Note 4). | |
| Summary of Abbreviations: | ||
| AUD | Australian Dollar | |
| BRL | Brazillian Real | |
| EUR | Euro | |
| GBP | British Pound | |
| HUF | Hungarian Forint | |
| IDR | Indonesian Rupiah | |
| INR | Indian Rupee | |
| JPY | Japanese Yen | |
| MXN | Mexican Peso | |
| MYR | Malaysian Ringgit | |
| NOK | Norwegian Krone | |
| NZD | New Zealand Dollar | |
| PLN | Polish Zloty | |
| SEK | Swedish Krona | |
| USD | United States Dollar | |
| ZAR | South African Rand | |
| 56 |
The Fund’s assets and liabilities are classified into the following three levels based on the inputs used to value the assets or liabilities:
| Level 1 — Unadjusted quoted prices in active markets for identical securities that the Fund has the ability to access. |
| Level 2 — Observable inputs other than quoted prices included in Level 1 that are observable for the asset or liability, either directly or indirectly. These inputs may include quoted prices for the identical instrument on an inactive market, prices for similar instruments, interest rates, prepayment speeds, credit risk, yield curves, default rates and similar data. |
| Level 3 — Unobservable inputs for the asset or liability, to the extent relevant observable inputs are not available, representing the Fund’s own assumption about the assumptions a market participant would use in valuing the asset or liability, and would be based on the best information available. |
The inputs methodology used for valuing securities are not necessarily an indication of the risk associated with investing in those securities. For example, U.S. Government securities are reflected as Level 2 because the inputs used to determine fair value may not always be quoted prices in an active market.
The following is a summary, by category of Level, of inputs used to value the Fund’s investments as of March 31, 2017:
| Level 1 | Level 2 | Level 3 | Total | |||||||||
| Sovereign Bonds | ||||||||||||
| Mexico | $ | — | $ | 16,918,264 | $ | — | $ | 16,918,264 | ||||
| Australia | — | 10,560,726 | — | 10,560,726 | ||||||||
| Poland | — | 7,493,735 | — | 7,493,735 | ||||||||
| Brazil | — | 6,864,003 | — | 6,864,003 | ||||||||
| Malaysia | — | 6,585,808 | — | 6,585,808 | ||||||||
| South Africa | — | 6,452,703 | — | 6,452,703 | ||||||||
| United Kingdom | — | 5,632,647 | — | 5,632,647 | ||||||||
| Indonesia | — | 5,420,078 | — | 5,420,078 | ||||||||
| Portugal | — | 4,786,247 | — | 4,786,247 | ||||||||
| Spain | — | 1,676,199 | — | 1,676,199 | ||||||||
| New Zealand | — | 1,451,129 | — | 1,451,129 | ||||||||
| Hungary | — | 1,193,779 | — | 1,193,779 |
| 57 |
Portfolio of Investments (continued)
INTERNATIONAL OPPORTUNITIES BOND FUND
March 31, 2017
| Level 1 | Level 2 | Level 3 | Total | |||||||||
| U.S. Government Obligations | $ | — | $ | 21,438,269 | $ | — | $ | 21,438,269 | ||||
| Corporate Bonds | ||||||||||||
| United States | — | 11,117,013 | — | 11,117,013 | ||||||||
| Australia | — | 1,033,143 | — | 1,033,143 | ||||||||
| New Zealand | — | 470,149 | — | 470,149 | ||||||||
| Netherlands | — | 437,053 | — | 437,053 | ||||||||
| United Kingdom | — | 382,745 | — | 382,745 | ||||||||
| Government Regional Agency | ||||||||||||
| Norway | — | 1,887,068 | — | 1,887,068 | ||||||||
| South Korea | — | 1,009,478 | — | 1,009,478 | ||||||||
| Netherlands | — | 974,075 | — | 974,075 | ||||||||
| Supranational | ||||||||||||
| Venezuela | — | 1,073,653 | — | 1,073,653 | ||||||||
| Luxembourg | — | 515,020 | — | 515,020 | ||||||||
| Government Guaranteed Program | ||||||||||||
| France | — | 1,396,923 | — | 1,396,923 | ||||||||
| Total Investments in Securities | $ | — | $ | 116,769,907 | $ | — | $ | 116,769,907 | ||||
| Other Financial Instruments* | $ | — | $ | 653,314 | $ | — | $ | 653,314 |
| * | Other financial instruments are foreign exchange contracts and are considered derivative instruments, |
| which are valued at the net unrealized appreciation on the instrument. | |
| During the period ended March 31, 2017, there were no transfers between Level 1 investments and | |
| Level 2 investments that had a material impact to the Fund. Transfers, if any, between Levels are | |
| recognized at the end of the reporting period. |
| 58 | See notes to financial statements |
Fund Expenses (unaudited)
INVESTMENT GRADE FUND
The examples below show the ongoing costs (in dollars) of investing in your Fund and will help you in comparing these costs with costs of other mutual funds. Please refer to page 6 for a detailed explanation of the information presented in these examples.
| Annualized | Beginning | Ending | Expenses Paid | |
| Expense | Account Value | Account Value | During Period | |
| Expense Example | Ratio | (10/1/16) | (3/31/17) | (10/1/16–3/31/17)* |
| Class A Shares | 1.05% | |||
| Actual | $1,000.00 | $ 981.34 | $5.19 | |
| Hypothetical** | $1,000.00 | $1,019.69 | $5.29 | |
| Class B Shares | 1.90% | |||
| Actual | $1,000.00 | $ 976.99 | $9.36 | |
| Hypothetical** | $1,000.00 | $1,015.46 | $9.55 | |
| Advisor Class Shares | 0.74% | |||
| Actual | $1,000.00 | $ 983.67 | $3.66 | |
| Hypothetical** | $1,000.00 | $1,021.24 | $3.73 | |
| Institutional Class Shares | 0.64% | |||
| Actual | $1,000.00 | $ 983.50 | $3.16 | |
| Hypothetical** | $1,000.00 | $1,021.74 | $3.23 |
| * | Expenses are equal to the annualized expense ratio, multiplied by the average account value over |
| the period, multiplied by 182/365 (to reflect the one-half year period). Expenses paid during the | |
| period are net of expenses waived. | |
| ** | Assumed rate of return of 5% before expenses. |
| Portfolio holdings and allocations are subject to change. Percentages are as of March 31, 2017, and |
| are based on the total market value of investments. |
| 59 |
Portfolio of Investments
INVESTMENT GRADE FUND
March 31, 2017
| Principal | |||
| Amount | Security | Value | |
| CORPORATE BONDS—97.2% | |||
| Aerospace/Defense—.7% | |||
| $ 4,000M | Rolls-Royce, PLC, 3.625%, 10/14/2025 (a) | $ 4,030,696 | |
| Automotive—.4% | |||
| 2,700M | O’Reilly Automotive, Inc., 3.55%, 3/15/2026 | 2,695,661 | |
| Chemicals—2.3% | |||
| 4,000M | Agrium, Inc., 3.375%, 3/15/2025 | 3,954,440 | |
| 4,020M | Dow Chemical Co., 3.5%, 10/1/2024 | 4,092,489 | |
| 5,000M | LyondellBasell Industries NV, 6%, 11/15/2021 | 5,666,155 | |
| 13,713,084 | |||
| Consumer Non-Durables—.3% | |||
| 1,800M | Newell Brands, Inc., 4.2%, 4/1/2026 | 1,875,391 | |
| Energy—10.7% | |||
| 8,600M | BP Capital Markets, PLC, 3.216%, 11/28/2023 | 8,651,617 | |
| 5,000M | Canadian Oil Sands, Ltd., 7.75%, 5/15/2019 (a) | 5,495,955 | |
| 5,000M | Continental Resources, Inc., 5%, 9/15/2022 | 5,068,750 | |
| 3,000M | DCP Midstream Operating, LP, 2.5%, 12/1/2017 | 3,000,000 | |
| 2,700M | Enable Midstream Partners, LP, 4.4%, 3/15/2027 | 2,685,193 | |
| 5,000M | Enbridge Energy Partners, LP, 4.2%, 9/15/2021 | 5,191,730 | |
| Kinder Morgan Energy Partners, LP: | |||
| 3,000M | 3.5%, 3/1/2021 | 3,051,444 | |
| 5,000M | 3.45%, 2/15/2023 | 4,941,190 | |
| 4,000M | Magellan Midstream Partners, LP, 5%, 3/1/2026 | 4,411,032 | |
| Marathon Oil Corp.: | |||
| 2,700M | 6%, 10/1/2017 | 2,759,314 | |
| 1,800M | 3.85%, 6/1/2025 | 1,772,723 | |
| 4,000M | ONEOK Partners, LP, 3.375%, 10/1/2022 | 4,008,456 | |
| 5,800M | Spectra Energy, LLC, 6.2%, 4/15/2018 | 6,050,914 | |
| Valero Energy Corp.: | |||
| 4,000M | 9.375%, 3/15/2019 | 4,550,108 | |
| 900M | 3.4%, 9/15/2026 | 861,479 | |
| 62,499,905 | |||
| Financial Services—14.5% | |||
| 2,000M | American Express Co., 7%, 3/19/2018 | 2,100,652 | |
| American International Group, Inc.: | |||
| 3,700M | 3.75%, 7/10/2025 | 3,685,851 | |
| 2,000M | 4.7%, 7/10/2035 | 2,030,184 | |
| 4,500M | Ameriprise Financial, Inc., 5.3%, 3/15/2020 | 4,890,883 |
| 60 |
| Principal | |||
| Amount | Security | Value | |
| Financial Services (continued) | |||
| $ 5,400M | Assured Guaranty U.S. Holding, Inc., 5%, 7/1/2024 | $ 5,819,904 | |
| 4,300M | Berkshire Hathaway, Inc., 3.4%, 1/31/2022 | 4,500,918 | |
| 2,400M | Compass Bank, 6.4%, 10/1/2017 | 2,450,090 | |
| ERAC USA Finance, LLC: | |||
| 3,750M | 4.5%, 8/16/2021 (a) | 3,997,800 | |
| 3,000M | 7%, 10/15/2037 (a) | 3,803,010 | |
| 6,200M | Ford Motor Credit Co., LLC, 8.125%, 1/15/2020 | 7,129,597 | |
| General Electric Capital Corp.: | |||
| 6,400M | 4.65%, 10/17/2021 | 7,029,402 | |
| 3,400M | 6.75%, 3/15/2032 | 4,591,533 | |
| 2,700M | Harley-Davidson Financial Services, Inc., 2.4%, 9/15/2019 (a) | 2,718,203 | |
| 1,800M | Harley-Davidson Funding Corp., 6.8%, 6/15/2018 (a) | 1,905,158 | |
| 4,500M | International Lease Finance Corp., 8.25%, 12/15/2020 | 5,322,168 | |
| 2,700M | Key Bank NA, 3.4%, 5/20/2026 | 2,630,813 | |
| 4,000M | Liberty Mutual Group, Inc., 4.95%, 5/1/2022 (a) | 4,350,876 | |
| 3,000M | National City Corp., 6.875%, 5/15/2019 | 3,296,472 | |
| 4,550M | Protective Life Corp., 7.375%, 10/15/2019 | 5,116,120 | |
| 3,000M | Prudential Financial, Inc., 7.375%, 6/15/2019 | 3,346,464 | |
| 4,000M | State Street Corp., 3.55%, 8/18/2025 | 4,115,148 | |
| 84,831,246 | |||
| Financials—25.0% | |||
| Bank of America Corp.: | |||
| 5,925M | 5%, 5/13/2021 | 6,439,207 | |
| 3,250M | 4.1%, 7/24/2023 | 3,409,003 | |
| 4,625M | 5.875%, 2/7/2042 | 5,581,866 | |
| Barclays Bank, PLC: | |||
| 2,000M | 5.125%, 1/8/2020 | 2,135,540 | |
| 3,800M | 3.75%, 5/15/2024 | 3,917,477 | |
| 3,200M | Capital One Financial Corp., 3.75%, 4/24/2024 | 3,259,354 | |
| Citigroup, Inc.: | |||
| 2,250M | 8.5%, 5/22/2019 | 2,545,488 | |
| 6,200M | 4.5%, 1/14/2022 | 6,642,203 | |
| 5,000M | 3.7%, 1/12/2026 | 5,013,950 | |
| Deutsche Bank AG: | |||
| 2,700M | 3.375%, 5/12/2021 | 2,718,970 | |
| 3,000M | 3.7%, 5/30/2024 | 2,953,374 | |
| 4,000M | General Motors Financial Co., 5.25%, 3/1/2026 | 4,305,160 |
| 61 |
Portfolio of Investments (continued)
INVESTMENT GRADE FUND
March 31, 2017
| Principal | |||
| Amount | Security | Value | |
| Financials (continued) | |||
| Goldman Sachs Group, Inc.: | |||
| $ 1,800M | 2.35%, 11/15/2021 | $ 1,764,801 | |
| 5,900M | 5.75%, 1/24/2022 | 6,643,831 | |
| 3,000M | 3.625%, 1/22/2023 | 3,079,419 | |
| 4,700M | 3.5%, 11/16/2026 | 4,604,087 | |
| 4,550M | 6.125%, 2/15/2033 | 5,507,902 | |
| JPMorgan Chase & Co.: | |||
| 6,200M | 6%, 1/15/2018 | 6,410,025 | |
| 5,000M | 4.5%, 1/24/2022 | 5,391,985 | |
| 5,850M | 3.625%, 12/1/2027 | 5,687,908 | |
| 3,000M | 6.4%, 5/15/2038 | 3,882,252 | |
| Morgan Stanley: | |||
| 11,500M | 5.5%, 7/28/2021 | 12,765,288 | |
| 3,600M | 3.625%, 1/20/2027 | 3,581,017 | |
| 4,000M | SunTrust Banks, Inc., 6%, 9/11/2017 | 4,079,472 | |
| U.S. Bancorp: | |||
| 4,000M | 3.6%, 9/11/2024 | 4,123,172 | |
| 2,700M | 3.1%, 4/27/2026 | 2,657,615 | |
| 4,000M | UBS AG, 4.875%, 8/4/2020 | 4,309,176 | |
| 5,000M | Visa, Inc., 3.15%, 12/14/2025 | 5,022,830 | |
| Wells Fargo & Co.: | |||
| 8,600M | 3.45%, 2/13/2023 | 8,685,372 | |
| 2,000M | 4.4%, 6/14/2046 | 1,941,646 | |
| 4,500M | 4.75%, 12/7/2046 | 4,608,324 | |
| 2,350M | Wells Fargo Bank NA, 5.85%, 2/1/2037 | 2,834,260 | |
| 146,501,974 | |||
| Food/Beverage/Tobacco—5.0% | |||
| Anheuser-Busch InBev Finance, Inc.: | |||
| 4,000M | 3.75%, 1/15/2022 | 4,196,756 | |
| 4,000M | 3.65%, 2/1/2026 | 4,052,204 | |
| 3,000M | 4.9%, 2/1/2046 | 3,254,976 | |
| 5,225M | Bunge Ltd. Finance Corp., 8.5%, 6/15/2019 | 5,929,920 | |
| 6,000M | Ingredion, Inc., 4.625%, 11/1/2020 | 6,448,932 | |
| 4,000M | Mondelez International Holdings, Inc., 2%, 10/28/2021 (a) | 3,852,972 | |
| 1,800M | PepsiCo, Inc., 3.45%, 10/6/2046 | 1,632,940 | |
| 29,368,700 | |||
| Food/Drug—.7% | |||
| 4,000M | CVS Health Corp., 3.875%, 7/20/2025 | 4,128,492 |
| 62 |
| Principal | |||
| Amount | Security | Value | |
| Forest Products/Containers—.5% | |||
| $ 2,500M | Rock-Tenn Co., 4.9%, 3/1/2022 | $ 2,710,095 | |
| Health Care—2.0% | |||
| 3,100M | Biogen, Inc., 6.875%, 3/1/2018 | 3,246,072 | |
| 4,050M | Express Scripts Holding Co., 4.75%, 11/15/2021 | 4,353,633 | |
| 4,000M | Laboratory Corp. of America, 3.75%, 8/23/2022 | 4,100,568 | |
| 11,700,273 | |||
| Information Technology—3.2% | |||
| 2,500M | Apple, Inc., 2.5%, 2/9/2025 | 2,421,160 | |
| 8,550M | Diamond 1 Finance Corp., 3.48%, 6/1/2019 (a) | 8,765,828 | |
| 4,000M | HP Enterprise Co., 2.85%, 10/5/2018 | 4,049,680 | |
| 3,500M | Oracle Corp., 2.4%, 9/15/2023 | 3,409,959 | |
| 18,646,627 | |||
| Manufacturing—2.6% | |||
| 5,000M | CRH America, Inc., 8.125%, 7/15/2018 | 5,394,230 | |
| 4,000M | Ingersoll-Rand Global Holdings Co., Ltd., 6.875%, 8/15/2018 | 4,273,800 | |
| 5,000M | Johnson Controls International, PLC, 5%, 3/30/2020 | 5,371,715 | |
| 15,039,745 | |||
| Media-Broadcasting—2.1% | |||
| 1,800M | ABC, Inc., 8.75%, 8/15/2021 | 2,221,382 | |
| 3,950M | British Sky Broadcasting, PLC, 9.5%, 11/15/2018 (a) | 4,407,130 | |
| 5,800M | Comcast Corp., 4.25%, 1/15/2033 | 5,981,842 | |
| 12,610,354 | |||
| Media-Diversified—.7% | |||
| 4,000M | Time Warner, Inc., 3.6%, 7/15/2025 | 3,962,060 | |
| Metals/Mining—4.0% | |||
| 5,000M | Alcoa, Inc., 6.15%, 8/15/2020 | 5,425,000 | |
| 4,000M | Glencore Finance Canada, Ltd., 4.95%, 11/15/2021 (a) | 4,299,640 | |
| 4,200M | Newmont Mining Corp., 5.125%, 10/1/2019 | 4,493,441 | |
| 5,000M | Rio Tinto Finance USA, Ltd., 3.75%, 9/20/2021 | 5,247,890 | |
| 4,000M | Vale Overseas, Ltd., 5.625%, 9/15/2019 | 4,255,000 | |
| 23,720,971 |
| 63 |
Portfolio of Investments (continued)
INVESTMENT GRADE FUND
March 31, 2017
| Principal | |||
| Amount | Security | Value | |
| Real Estate—9.1% | |||
| $ 4,000M | Alexandria Real Estate Equities, Inc., 3.95%, 1/15/2028 | $ 3,997,600 | |
| AvalonBay Communities, Inc.: | |||
| 3,500M | 4.2%, 12/15/2023 | 3,706,154 | |
| 3,500M | 3.5%, 11/15/2024 | 3,544,730 | |
| 4,000M | Boston Properties, LP, 5.875%, 10/15/2019 | 4,331,256 | |
| Digital Realty Trust, LP: | |||
| 2,700M | 5.25%, 3/15/2021 | 2,932,006 | |
| 2,700M | 4.75%, 10/1/2025 | 2,854,459 | |
| 4,000M | ERP Operating, LP, 3.375%, 6/1/2025 | 3,969,000 | |
| 2,200M | HCP, Inc., 4.25%, 11/15/2023 | 2,276,604 | |
| Prologis, LP: | |||
| 2,000M | 3.35%, 2/1/2021 | 2,061,096 | |
| 1,125M | 3.75%, 11/1/2025 | 1,151,693 | |
| Realty Income Corp.: | |||
| 5,528M | 3.25%, 10/15/2022 | 5,588,111 | |
| 1,800M | 4.125%, 10/15/2026 | 1,858,554 | |
| 3,000M | Simon Property Group, LP, 3.375%, 10/1/2024 | 3,026,889 | |
| Ventas Realty, LP: | |||
| 4,000M | 4.75%, 6/1/2021 | 4,285,836 | |
| 1,500M | 3.5%, 2/1/2025 | 1,470,693 | |
| 6,500M | Welltower, Inc., 4%, 6/1/2025 | 6,599,470 | |
| 53,654,151 | |||
| Retail-General Merchandise—1.9% | |||
| 4,000M | Amazon.com, Inc., 4.8%, 12/5/2034 | 4,442,504 | |
| 5,200M | Home Depot, Inc., 5.875%, 12/16/2036 | 6,591,135 | |
| 11,033,639 | |||
| Telecommunications—1.4% | |||
| 4,500M | AT&T, Inc., 4.25%, 3/1/2027 | 4,558,815 | |
| 4,100M | Verizon Communications, Inc., 4.272%, 1/15/2036 | 3,808,556 | |
| 8,367,371 |
| 64 |
| Principal | |||||
| Amount | Security | Value | |||
| Transportation—2.3% | |||||
| $ 4,000M | Burlington North Santa Fe, LLC, 5.15%, 9/1/2043 | $ 4,574,244 | |||
| 3,000M | Penske Truck Leasing Co., LP, 4.875%, 7/11/2022 (a) | 3,242,313 | |||
| 5,800M | Southwest Airlines Co., 3%, 11/15/2026 | 5,486,788 | |||
| 13,303,345 | |||||
| Utilities—7.8% | |||||
| 3,000M | Duke Energy Progress, Inc., 4.15%, 12/1/2044 | 3,053,877 | |||
| 3,000M | E.ON International Finance BV, 5.8%, 4/30/2018 (a) | 3,125,484 | |||
| 3,000M | Electricite de France SA, 3.625%, 10/13/2025 (a) | 3,021,693 | |||
| 3,000M | Entergy Arkansas, Inc., 4.95%, 12/15/2044 | 3,067,356 | |||
| 4,000M | Exelon Generation Co., LLC, 5.2%, 10/1/2019 | 4,281,704 | |||
| Great River Energy Co.: | |||||
| 173M | 5.829%, 7/1/2017 (a) | 173,865 | |||
| 6,504M | 4.478%, 7/1/2030 (a) | 6,564,466 | |||
| 3,000M | MidAmerican Energy, Co., 3.95%, 8/1/2047 | 3,003,990 | |||
| 3,850M | Ohio Power Co., 5.375%, 10/1/2021 | 4,291,791 | |||
| 4,550M | Oklahoma Gas & Electric Co., 4%, 12/15/2044 | 4,378,278 | |||
| 1,929M | San Diego Gas & Electric Co., 1.914%, 2/1/2022 | 1,905,930 | |||
| 4,000M | Sempra Energy, 9.8%, 2/15/2019 | 4,564,356 | |||
| 4,000M | South Carolina Electric & Gas Co., 5.45%, 2/1/2041 | 4,506,868 | |||
| 45,939,658 | |||||
| Total Value of Corporate Bonds (cost $559,911,905) | 570,333,438 | ||||
| TAXABLE MUNICIPAL BONDS—.5% | |||||
| 3,000M | Ford Foundation, 3.859%, 6/1/2047 (cost $3,000,750) | 3,034,253 | |||
| Total Value of Investments (cost $562,912,655) | 97.7 | % | 573,367,691 | ||
| Other Assets, Less Liabilities | 2.3 | 13,277,326 | |||
| Net Assets | 100.0 | % | $586,645,017 | ||
| (a) | Security exempt from registration under Rule 144A of the Securities Act of 1933 (see Note 4). |
| 65 |
Portfolio of Investments (continued)
INVESTMENT GRADE FUND
March 31, 2017
The Fund’s assets and liabilities are classified into the following three levels based on the inputs used to value the assets or liabilities:
| Level 1 — Unadjusted quoted prices in active markets for identical securities that the Fund has the ability to access. |
| Level 2 — Observable inputs other than quoted prices included in Level 1 that are observable for the asset or liability, either directly or indirectly. These inputs may include quoted prices for the identical instrument on an inactive market, prices for similar instruments, interest rates, prepayment speeds, credit risk, yield curves, default rates and similar data. |
| Level 3 — Unobservable inputs for the asset or liability, to the extent relevant observable inputs are not available, representing the Fund’s own assumption about the assumptions a market participant would use in valuing the asset or liability, and would be based on the best information available. |
The inputs methodology used for valuing securities are not necessarily an indication of the risk associated with investing in those securities. For example, U.S. Government securities are reflected as Level 2 because the inputs used to determine fair value may not always be quoted prices in an active market.
The following is a summary, by category of Level, of inputs used to value the Fund’s investments as of March 31, 2017:
| Level 1 | Level 2 | Level 3 | Total | |||||||||
| Corporate Bonds | $ | — | $ | 570,333,438 | $ | — | $ | 570,333,438 | ||||
| Taxable Municipal Bonds | — | 3,034,253 | — | 3,034,253 | ||||||||
| Total Investments in Securities* | $ | — | $ | 573,367,691 | $ | — | $ | 573,367,691 |
| * | The Portfolio of Investments provides information on the industry categorization for corporate bonds. |
| There were no transfers into or from Level 1 and Level 2 by the Fund for the period ended March 31, | |
| 2017. Transfers, if any, between Levels are recognized at the end of the reporting period. |
| 66 | See notes to financial statements |
Fund Expenses (unaudited)
LIMITED DURATION HIGH QUALITY BOND FUND
The examples below show the ongoing costs (in dollars) of investing in your Fund and will help you in comparing these costs with costs of other mutual funds. Please refer to page 6 for a detailed explanation of the information presented in these examples.
| Annualized | Beginning | Ending | Expenses Paid | |
| Expense | Account Value | Account Value | During Period | |
| Expense Example | Ratio | (10/1/16) | (3/31/17) | (10/1/16–3/31/17)* |
| Class A Shares | 1.05% | |||
| Actual | $1,000.00 | $ 992.56 | $5.22 | |
| Hypothetical** | $1,000.00 | $1,019.69 | $5.29 | |
| Advisor Class Shares | 0.75% | |||
| Actual | $1,000.00 | $ 994.13 | $3.73 | |
| Hypothetical** | $1,000.00 | $1,021.19 | $3.78 | |
| Institutional Class Shares | 0.60% | |||
| Actual | $1,000.00 | $ 994.77 | $2.98 | |
| Hypothetical** | $1,000.00 | $1,021.94 | $3.02 |
| * | Expenses are equal to the annualized expense ratio, multiplied by the average account value over |
| the period, multiplied by 182/365 (to reflect the one-half year period). Expenses paid during the | |
| period are net of expenses waived and/or assumed. | |
| ** | Assumed rate of return of 5% before expenses. |
| Portfolio holdings and allocations are subject to change. Percentages are as of March 31, 2017, and |
| are based on the total market value of investments. |
| 67 |
Portfolio of Investments
LIMITED DURATION HIGH QUALITY BOND FUND
March 31, 2017
| Principal | |||
| Amount | Security | Value | |
| CORPORATE BONDS—65.5% | |||
| Aerospace/Defense—.7% | |||
| $ 1,000M | Honeywell International, Inc., 1.85%, 11/1/2021 | $ 981,119 | |
| Automotive—2.8% | |||
| 900M | BMW U.S. Capital, LLC, 1.85%, 9/15/2021 (a) | 871,985 | |
| Daimler Finance NA, LLC: | |||
| 1,000M | 2.25%, 7/31/2019 (a) | 1,005,092 | |
| 1,000M | 2.45%, 5/18/2020 (a) | 1,001,708 | |
| 1,000M | Toyota Motor Credit Corp., 2.6%, 1/11/2022 | 1,005,566 | |
| 3,884,351 | |||
| Chemicals—1.6% | |||
| 1,000M | Dow Chemical Co., 4.25%, 11/15/2020 | 1,061,548 | |
| 1,000M | Lubrizol Corp., 8.875%, 2/1/2019 | 1,125,987 | |
| 2,187,535 | |||
| Consumer Durables—.4% | |||
| 500M | Stanley Black & Decker, Inc., 2.451%, 11/17/2018 | 505,410 | |
| Energy—2.2% | |||
| 650M | ConocoPhillips Co., 1.05%, 12/15/2017 | 647,665 | |
| 1,000M | Shell International Finance BV, 1.375%, 5/10/2019 | 991,437 | |
| 450M | Suncor Energy, Inc., 6.1%, 6/1/2018 | 473,780 | |
| 900M | TransCanada Pipelines, Ltd., 1.625%, 11/9/2017 | 900,129 | |
| 3,013,011 | |||
| Financial Services—11.3% | |||
| American Express Co.: | |||
| 500M | 6.15%, 8/28/2017 | 509,081 | |
| 500M | 7%, 3/19/2018 | 525,163 | |
| 1,000M | Ameriprise Financial, Inc., 5.3%, 3/15/2020 | 1,086,863 | |
| 1,000M | BlackRock, Inc., 5%, 12/10/2019 | 1,084,856 | |
| 1,000M | Capital One NA, 2.25%, 9/13/2021 | 979,469 | |
| 1,850M | Citizens Bank, 2.25%, 3/2/2020 | 1,848,637 | |
| 500M | ERAC USA Finance, LLC, 6.375%, 10/15/2017 (a) | 511,917 | |
| 1,825M | Ford Motor Credit Co., LLC, 5%, 5/15/2018 | 1,886,054 | |
| 1,250M | Harley-Davidson Funding Corp., 6.8%, 6/15/2018 (a) | 1,323,026 | |
| 1,500M | Protective Life Corp., 7.375%, 10/15/2019 | 1,686,633 | |
| 700M | Prudential Financial, Inc., 7.375%, 6/15/2019 | 780,842 |
| 68 |
| Principal | |||
| Amount | Security | Value | |
| Financial Services (continued) | |||
| Siemens Financieringsmaatschappij NV: | |||
| $ 750M | 1.45%, 5/25/2018 (a) | $ 749,418 | |
| 1,000M | 1.7%, 9/15/2021 (a) | 964,726 | |
| 1,025M | State Street Bank & Trust, 5.25%, 10/15/2018 | 1,076,482 | |
| 500M | UnitedHealth Group, Inc., 2.7%, 7/15/2020 | 510,291 | |
| 15,523,458 | |||
| Financials—23.2% | |||
| 1,400M | Bank of America Corp., 5.65%, 5/1/2018 | 1,456,966 | |
| 900M | Bank of Montreal, 1.9%, 8/27/2021 | 877,206 | |
| 900M | Bank of New York Mellon Corp., 2.05%, 5/3/2021 | 888,650 | |
| 700M | Barclays Bank, PLC, 6.75%, 5/22/2019 | 766,349 | |
| 2,000M | Capital One Financial Corp., 3.05%, 3/9/2022 | 2,001,070 | |
| Citigroup, Inc.: | |||
| 500M | 6.125%, 11/21/2017 | 514,267 | |
| 250M | 8.5%, 5/22/2019 | 282,832 | |
| 1,000M | 2.65%, 10/26/2020 | 1,007,327 | |
| Danske Bank A/S: | |||
| 1,000M | 2%, 9/8/2021 (a) | 971,800 | |
| 800M | 2.7%, 3/2/2022 (a) | 797,478 | |
| 1,000M | DNB Bank ASA, 2.375%, 6/2/2021 (a) | 989,019 | |
| 1,500M | Fifth Third Bank, 1.625%, 9/27/2019 | 1,482,192 | |
| Goldman Sachs Group, Inc.: | |||
| 1,000M | 6.15%, 4/1/2018 | 1,042,032 | |
| 1,000M | 5.375%, 3/15/2020 | 1,084,819 | |
| 1,000M | 2.6%, 12/17/2020 | 1,000,810 | |
| 1,000M | ING Groep NV, 3.15%, 3/29/2022 | 1,003,480 | |
| JPMorgan Chase & Co.: | |||
| 750M | 6%, 1/15/2018 | 775,406 | |
| 2,000M | 4.5%, 1/24/2022 | 2,156,794 | |
| 800M | Lloyds Banking Group, PLC, 3%, 1/11/2022 | 796,305 | |
| 3,300M | Morgan Stanley, 5.5%, 7/28/2021 | 3,663,083 | |
| 1,000M | Northern Trust Co., 6.5%, 8/15/2018 | 1,065,453 | |
| 1,340M | Santander U.K., PLC, 2%, 8/24/2018 | 1,343,087 | |
| 800M | U.S. Bank NA, 2.125%, 10/28/2019 | 804,069 | |
| UBS AG: | |||
| 600M | 5.875%, 12/20/2017 | 618,248 | |
| 1,000M | 1.8%, 3/26/2018 | 1,000,855 |
| 69 |
Portfolio of Investments (continued)
LIMITED DURATION HIGH QUALITY BOND FUND
March 31, 2017
| Principal | |||
| Amount | Security | Value | |
| Financials (continued) | |||
| $ 1,000M | UBS Group Funding Switzerland, 3.491%, 3/23/2023 (a) | $ 1,007,629 | |
| 900M | Wachovia Corp., 5.75%, 2/1/2018 | 928,395 | |
| 1,500M | Wells Fargo & Co., 4.60%, 4/1/2021 | 1,613,492 | |
| 31,939,113 | |||
| Food/Beverage/Tobacco—4.3% | |||
| 900M | Anheuser-Busch InBev Finance, Inc., 1.9%, 2/1/2019 | 901,707 | |
| 1,500M | Bunge Ltd. Finance Corp., 8.5%, 6/15/2019 | 1,702,369 | |
| 1,000M | Ingredion, Inc., 4.625%, 11/1/2020 | 1,074,822 | |
| 900M | Mead Johnson Nutrition Co., 3%, 11/15/2020 | 918,181 | |
| 800M | Mondelez International Holdings, Inc., 2%, 10/28/2021 (a) | 770,594 | |
| 500M | Philip Morris International, Inc., 5.65%, 5/16/2018 | 522,882 | |
| 5,890,555 | |||
| Forest Products/Containers—.7% | |||
| 900M | Georgia Pacific, LLC, 3.163%, 11/15/2021 (a) | 915,654 | |
| Health Care—1.5% | |||
| 1,000M | Gilead Sciences, Inc., 2.55%, 9/1/2020 | 1,011,261 | |
| 250M | Quest Diagnostics, Inc., 2.7%, 4/1/2019 | 253,590 | |
| 900M | Teva Pharmaceutical NE, 2.2%, 7/21/2021 | 869,435 | |
| 2,134,286 | |||
| Information Technology—3.7% | |||
| Apple, Inc.: | |||
| 1,000M | 1.55%, 8/4/2021 | 970,780 | |
| 900M | 2.5%, 2/9/2022 | 904,596 | |
| Diamond 1 Finance Corp.: | |||
| 750M | 3.48%, 6/1/2019 (a) | 768,932 | |
| 900M | 4.42%, 6/15/2021 (a) | 942,053 | |
| 500M | HP Enterprise Co., 2.85%, 10/5/2018 | 506,210 | |
| 1,000M | Oracle Corp., 1.9%, 9/15/2021 | 983,244 | |
| 5,075,815 | |||
| Manufacturing—.6% | |||
| 250M | CRH America, Inc., 8.125%, 7/15/2018 | 269,711 | |
| 500M | Ingersoll-Rand Global Holdings Co., Ltd., 6.875%, 8/15/2018 | 534,225 | |
| 803,936 |
| 70 |
| Principal | |||
| Amount | Security | Value | |
| Real Estate—3.5% | |||
| $ 1,000M | Boston Properties, LP, 5.875%, 10/15/2019 | $ 1,082,814 | |
| 1,000M | Realty Income Corp., 3.25%, 10/15/2022 | 1,010,874 | |
| 650M | Ventas Realty, LP, 4%, 4/30/2019 | 672,581 | |
| 1,000M | Wea Finance, LLC, 3.15%, 4/5/2022 (a)(b) | 1,000,695 | |
| 1,000M | Welltower, Inc., 6.125%, 4/15/2020 | 1,106,848 | |
| 4,873,812 | |||
| Telecommunications—2.0% | |||
| AT&T, Inc.: | |||
| 500M | 5.875%, 10/1/2019 | 544,663 | |
| 500M | 2.45%, 6/30/2020 | 500,351 | |
| Verizon Communications, Inc.: | |||
| 800M | 3.65%, 9/14/2018 | 821,968 | |
| 900M | 1.75%, 8/15/2021 | 862,490 | |
| 2,729,472 | |||
| Transportation—.7% | |||
| 1,000M | Southwest Airlines Co., 2.65%, 11/5/2020 | 1,012,141 | |
| Utilities—6.3% | |||
| 500M | Arizona Public Service Co., 8.75%, 3/1/2019 | 563,548 | |
| 500M | Consolidated Edison Co., Inc. of New York, 7.125%, 12/1/2018 | 543,720 | |
| 500M | Entergy Gulf States Louisiana, LLC, 6%, 5/1/2018 | 522,574 | |
| Exelon Generation Co., LLC: | |||
| 1,000M | 6.2%, 10/1/2017 | 1,021,920 | |
| 1,000M | 3.4%, 3/15/2022 | 1,009,269 | |
| 86M | Great River Energy Co., 5.829%, 7/1/2017 (a) | 86,932 | |
| 1,000M | Ohio Power Co., 6.05%, 5/1/2018 | 1,044,588 | |
| 500M | Public Service Electric & Gas Co., 1.8%, 6/1/2019 | 500,041 | |
| 557M | San Diego Gas & Electric Co., 1.914%, 2/1/2022 | 550,602 | |
| 500M | Sempra Energy, 9.8%, 2/15/2019 | 570,545 | |
| 1,557M | Southern Power Co., 1.85%, 12/1/2017 | 1,558,786 | |
| 700M | Wisconsin Public Service Corp., 1.65%, 12/4/2018 | 697,658 | |
| 8,670,183 | |||
| Total Value of Corporate Bonds (cost $90,477,504) | 90,139,851 | ||
| 71 |
Portfolio of Investments (continued)
LIMITED DURATION HIGH QUALITY BOND FUND
March 31, 2017
| Principal | |||
| Amount | Security | Value | |
| ASSET BACKED SECURITIES—12.1% | |||
| Fixed Autos—9.7% | |||
| $ 2,300M | AmeriCredit Auto Receivable Trust, 1.83%, 12/8/2021 | $ 2,277,890 | |
| 1,200M | Avis Budget Rental Car Funding AESOP, LLC, 2.97%, | ||
| 2/20/2020 (a) | 1,219,194 | ||
| 1,300M | CarMax Auto Owner Trust, 1.92%, 7/15/2022 | 1,281,068 | |
| 1,500M | Chrysler Capital Auto Receivables Trust, 2.22%, 5/16/2022 (a) | 1,474,668 | |
| 620M | GM Financial Auto Leasing Trust, 1.76%, 3/20/2020 | 619,273 | |
| 900M | Hertz Vehicle Financing, LLC, 2.65%, 7/25/2022 (a) | 883,186 | |
| 480M | Honda Auto Receivables Owner Trust, 1.46%, 10/15/2020 | 480,207 | |
| 900M | Hyundai Auto Lease Trust, 2.39%, 5/17/2021 (a) | 898,490 | |
| 950M | Hyundai Auto Receivables Trust, 1.48%, 6/15/2021 | 946,787 | |
| 1,700M | Hyundai Capital America Trust, 2.19%, 11/15/2022 | 1,688,114 | |
| 900M | Toyota Auto Receivables Owner Trust, 1.42%, 1/15/2022 | 887,719 | |
| 758M | Volkswagen Auto Lease Trust, 1.25%, 12/20/2017 | 758,155 | |
| 13,414,751 | |||
| Fixed Communications—1.7% | |||
| Verizon Owner Trust: | |||
| 1,100M | 2.15%, 5/20/2021 (a) | 1,096,425 | |
| 1,200M | 2.65%, 9/20/2021 (a) | 1,203,230 | |
| 2,299,655 | |||
| Fixed Equipment—.7% | |||
| 900M | Kubota Credit Owner Trust, 1.71%, 10/15/2022 (a) | 891,554 | |
| Total Value of Asset Backed Securities (cost $16,702,658) | 16,605,960 | ||
| RESIDENTIAL MORTGAGE-BACKED | |||
| SECURITIES—9.2% | |||
| Fannie Mae—7.7% | |||
| 3,370M | 2.5%, 5/1/2030 – 8/1/2031 | 3,382,144 | |
| 3,380M | 3%, 8/1/2026 – 4/1/2031 | 3,472,849 | |
| 3,631M | 3.5%, 12/1/2025 – 12/1/2029 | 3,800,613 | |
| 10,655,606 | |||
| Freddie Mac—1.5% | |||
| 1,583M | 3%, 8/1/2027 – 8/1/2030 | 1,622,088 | |
| 428M | 3.5%, 12/1/2025 | 447,779 | |
| 2,069,867 | |||
| Total Value of Residential Mortgage-Backed Securities (cost $12,865,485) | 12,725,473 | ||
| 72 |
| Principal | |||||
| Amount | Security | Value | |||
| COVERED BONDS—5.6% | |||||
| Financial Services—2.0% | |||||
| $ 2,750M | Stadshypotek AB, 1.875%, 10/2/2019 (a) | $ 2,742,556 | |||
| Financials—3.6% | |||||
| 2,500M | Royal Bank of Canada, 2.2%, 9/23/2019 | 2,513,995 | |||
| 2,500M | Toronto-Dominion Bank, 1.95%, 4/2/2020 (a) | 2,489,617 | |||
| 5,003,612 | |||||
| Total Value of Covered Bonds (cost $7,793,797) | 7,746,168 | ||||
| U.S. GOVERNMENT OBLIGATIONS—4.0% | |||||
| U.S. Treasury Notes: | |||||
| 1,680M | 1%, 3/15/2019 | 1,671,666 | |||
| 2,000M | 1.125%, 7/31/2021 | 1,939,960 | |||
| 1,920M | 1.375%, 4/30/2020 | 1,910,137 | |||
| Total Value of U.S. Government Obligations (cost $5,591,893) | 5,521,763 | ||||
| Total Value of Investments (cost $133,431,337) | 96.4 | % | 132,739,215 | ||
| Other Assets, Less Liabilities | 3.6 | 4,992,628 | |||
| Net Assets | 100.0 | % | $137,731,843 | ||
| (a) | Security exempt from registration under Rule 144A of the Securities Act of 1933 (see Note 4). |
| (b) | A portion or all of the security purchased on a when-issued or delayed delivery basis (see |
| Note 1G). |
| 73 |
Portfolio of Investments (continued)
LIMITED DURATION HIGH QUALITY BOND FUND
March 31, 2017
The Fund’s assets and liabilities are classified into the following three levels based on the inputs used to value the assets or liabilities:
| Level 1 — Unadjusted quoted prices in active markets for identical securities that the Fund has the ability to access. |
| Level 2 — Observable inputs other than quoted prices included in Level 1 that are observable for the asset or liability, either directly or indirectly. These inputs may include quoted prices for the identical instrument on an inactive market, prices for similar instruments, interest rates, prepayment speeds, credit risk, yield curves, default rates and similar data. |
| Level 3 — Unobservable inputs for the asset or liability, to the extent relevant observable inputs are not available, representing the Fund’s own assumption about the assumptions a market participant would use in valuing the asset or liability, and would be based on the best information available. |
The inputs methodology used for valuing securities are not necessarily an indication of the risk associated with investing in those securities. For example, U.S. Government securities are reflected as Level 2 because the inputs used to determine fair value may not always be quoted prices in an active market.
The following is a summary, by category of Level, of inputs used to value the Fund’s investments as of March 31, 2017:
| Level 1 | Level 2 | Level 3 | Total | |||||||||
| Corporate Bonds | $ | — | $ | 90,139,851 | $ | — | $ | 90,139,851 | ||||
| Asset Backed Securities | — | 16,605,960 | — | 16,605,960 | ||||||||
| Residential Mortgage-Backed | ||||||||||||
| Securities | — | 12,725,473 | — | 12,725,473 | ||||||||
| Covered Bonds | — | 7,746,168 | — | 7,746,168 | ||||||||
| U.S. Government Obligations | — | 5,521,763 | — | 5,521,763 | ||||||||
| Total Investments in Securities* | $ | — | $ | 132,739,215 | $ | — | $ | 132,739,215 |
| * | The Portfolio of Investments provides information on the industry categorization for corporate bonds, |
| asset backed securities and covered bonds. | |
| There were no transfers into or from Level 1 and Level 2 by the Fund for the period ended March 31, | |
| 2017. Transfers, if any, between Levels are recognized at the end of the reporting period. |
| 74 | See notes to financial statements |
Fund Expenses (unaudited)
STRATEGIC INCOME FUND
| Annualized | Beginning | Ending | Expenses Paid | |
| Expense | Account Value | Account Value | During Period | |
| Expense Example | Ratio | (10/1/16) | (3/31/17) | (10/1/16–3/31/17)* |
| Class A Shares | 0.57% | |||
| Actual* | $1,000.00 | $1,009.89 | $2.86 | |
| Hypothetical** | $1,000.00 | $1,022.09 | $2.87 | |
| Advisor Class Shares | 0.15% | |||
| Actual* | $1,000.00 | $1,012.16 | $0.75 | |
| Hypothetical** | $1,000.00 | $1,024.18 | $0.76 |
| * | Expenses are equal to the annualized expense ratio multiplied by the average account value over |
| the period, multiplied by 182/365 (to reflect the inception period). | |
| ** | Assumed rate of return of 5% before expenses. |
| Portfolio holdings and allocations are subject to change. Percentages are as of March 31, 2017, and |
| are based on the total market value of investments. |
| 75 |
Portfolio of Investments
STRATEGIC INCOME FUND
March 31, 2017
| Shares or | |||||
| Principal | |||||
| Amount | Security | Value | |||
| COMMON STOCKS—94.5% | |||||
| First Investors Income Funds—91.4% | |||||
| 2,015,191 | Floating Rate Fund – Institutional Class Shares | $ 19,466,743 | |||
| 23,523,039 | Fund For Income – Institutional Class Shares | 58,807,597 | |||
| 758,025 | Government Fund – Institutional Class Shares | 7,966,838 | |||
| 881,169 | * | International Opportunities Bond Fund – Institutional Class Shares | 8,018,634 | ||
| 2,905,889 | Investment Grade Fund – Institutional Class Shares | 27,809,357 | |||
| 2,431,935 | Limited Duration High Quality Bond Fund – Institutional | ||||
| Class Shares | 23,152,019 | ||||
| 145,221,188 | |||||
| First Investors Equity Funds—3.1% | |||||
| 444,718 | Covered Call Strategy Fund – Institutional Class Shares | 4,838,535 | |||
| Total Value of Common Stocks (cost $154,426,480) | 150,059,723 | ||||
| SHORT-TERM U.S. GOVERNMENT AGENCY | |||||
| OBLIGATIONS—4.7% | |||||
| Federal Home Loan Bank: | |||||
| $1,500M | 0.57%, 4/5/2017 | 1,499,943 | |||
| 1,000M | 0.56%, 4/7/2017 | 999,924 | |||
| 2,000M | 0.75%, 4/25/2017 | 1,999,168 | |||
| 3,000M | 1.032%, 8/25/2017 † | 3,004,140 | |||
| Total Value of Short-Term U.S. Government | |||||
| Agency Obligations (cost $7,503,562) | 7,503,175 | ||||
| Total Value of Investments (cost $161,930,042) | 99.2 | % | 157,562,898 | ||
| Other Assets, Less Liabilities | .8 | 1,313,118 | |||
| Net Assets | 100.0 | % | $158,876,016 | ||
| * | Non-income producing |
| † | Interest rates are determined and reset periodically. The interest rates above are the rates in effect |
| at March 31, 2017. |
| 76 |
The Fund’s assets and liabilities are classified into the following three levels based on the inputs used to value the assets or liabilities:
| Level 1 — Unadjusted quoted prices in active markets for identical securities that the Fund has the ability to access. |
| Level 2 — Observable inputs other than quoted prices included in Level 1 that are observable for the asset or liability, either directly or indirectly. These inputs may include quoted prices for the identical instrument on an inactive market, prices for similar instruments, interest rates, prepayment speeds, credit risk, yield curves, default rates and similar data. |
| Level 3 — Unobservable inputs for the asset or liability, to the extent relevant observable inputs are not available, representing the Fund’s own assumption about the assumptions a market participant would use in valuing the asset or liability, and would be based on the best information available. |
The inputs methodology used for valuing securities are not necessarily an indication of the risk associated with investing in those securities. For example, U.S. Government securities are reflected as Level 2 because the inputs used to determine fair value may not always be quoted prices in an active market.
The following is a summary, by category of Level, of inputs used to value the Fund’s investments as of March 31, 2017:
| Level 1 | Level 2 | Level 3 | Total | |||||||||
| Mutual Funds | ||||||||||||
| First Investors Income Funds | $ | 145,221,188 | $ | — | $ | — | $ | 145,221,188 | ||||
| First Investors Equity Funds | 4,838,535 | — | — | 4,838,535 | ||||||||
| Short-Term U.S. Government | ||||||||||||
| Agency Obligations | — | 7,503,175 | — | 7,503,175 | ||||||||
| Total Investments in Securities | $ | 150,059,723 | $ | 7,503,175 | $ | — | $ | 157,562,898 |
| There were no transfers into or from Level 1 and Level 2 by the Fund for the period ended March 31, |
| 2017. Transfers, if any, between Levels are recognized at the end of the reporting period. |
| See notes to financial statements | 77 |
Fund Expenses (unaudited)
COVERED CALL STRATEGY FUND
| Annualized | Beginning | Ending | Expenses Paid | |
| Expense | Account Value | Account Value | During Period | |
| Expense Example | Ratio | (10/1/16) | (3/31/17) | (10/1/16–3/31/17)* |
| Class A Shares | 1.30% | |||
| Actual | $1,000.00 | $1,058.19 | $6.67 | |
| Hypothetical*** | $1,000.00 | $1,018.45 | $6.54 | |
| Advisor Class Shares | 0.97% | |||
| Actual | $1,000.00 | $1,060.39 | $4.98 | |
| Hypothetical*** | $1,000.00 | $1,020.09 | $4.89 | |
| Institutional Class Shares | 0.84% | |||
| Actual | $1,000.00 | $1,061.02 | $4.32 | |
| Hypothetical*** | $1,000.00 | $1,020.74 | $4.23 |
| * | Expenses are equal to the annualized expense ratio, multiplied by the average account value over the |
| period, multiplied by 182/365 (to reflect the one-half year period). Expenses paid during the period | |
| are net of expenses waived. | |
| ** | Assumed rate of return of 5% before expenses. |
| Portfolio holdings and allocations are subject to change. Percentages are as of March 31, 2017, and |
| are based on the total market value of investments. |
| 78 |
Portfolio of Investments
COVERED CALL STRATEGY FUND
March 31, 2017
| Shares | Security | Value | |
| COMMON STOCKS—99.2% | |||
| Consumer Discretionary—8.7% | |||
| 5,200 | * | AutoZone, Inc. | $ 3,759,860 |
| 64,500 | CBS Corporation – Class “B” | 4,473,720 | |
| 35,700 | Walt Disney Company | 4,048,023 | |
| 28,100 | Whirlpool Corporation | 4,814,373 | |
| 17,095,976 | |||
| Consumer Staples—4.0% | |||
| 66,300 | General Mills, Inc. | 3,912,363 | |
| 95,100 | Mondelez International, Inc. | 4,096,908 | |
| 8,009,271 | |||
| Energy—11.0% | |||
| 51,000 | Chevron Corporation | 5,475,870 | |
| 47,500 | ExxonMobil Corporation | 3,895,475 | |
| 123,200 | Halliburton Company | 6,062,672 | |
| 95,900 | Valero Energy Corporation | 6,357,211 | |
| 21,791,228 | |||
| Financials—19.8% | |||
| 61,900 | American Express Company | 4,896,909 | |
| 285,100 | Bank of America Corporation | 6,725,509 | |
| 15,900 | BlackRock, Inc. | 6,097,809 | |
| 34,300 | Goldman Sachs Group, Inc. | 7,879,396 | |
| 96,800 | JPMorgan Chase & Company | 8,502,912 | |
| 95,800 | U.S. Bancorp | 4,933,700 | |
| 39,036,235 | |||
| Health Care—15.9% | |||
| 34,700 | Allergan, PLC | 8,290,524 | |
| 22,500 | Amgen, Inc. | 3,691,575 | |
| 73,400 | Bristol-Myers Squibb Company | 3,991,492 | |
| 21,700 | * | Express Scripts Holding Company | 1,430,247 |
| 88,100 | Medtronic, PLC | 7,097,336 | |
| 202,700 | Pfizer, Inc. | 6,934,367 | |
| 31,435,541 |
| 79 |
Portfolio of Investments (continued)
COVERED CALL STRATEGY FUND
March 31, 2017
| Shares | Security | Value | |||
| Industrials—14.9% | |||||
| 199,200 | General Electric Company | $ 5,936,160 | |||
| 64,000 | Honeywell International, Inc. | 7,991,680 | |||
| 15,600 | Lockheed Martin Corporation | 4,174,560 | |||
| 49,400 | Raytheon Company | 7,533,500 | |||
| 35,600 | United Parcel Service, Inc. – Class “B” | 3,819,880 | |||
| 29,455,780 | |||||
| Information Technology—18.1% | |||||
| 69,100 | Apple, Inc. | 9,926,906 | |||
| 219,200 | Cisco Systems, Inc. | 7,408,960 | |||
| 167,700 | Intel Corporation | 6,048,939 | |||
| 149,000 | Oracle Corporation | 6,646,890 | |||
| 98,500 | QUALCOMM, Inc. | 5,647,990 | |||
| 35,679,685 | |||||
| Materials—5.0% | |||||
| 154,900 | Dow Chemical Company | 9,842,346 | |||
| Telecommunication Services—1.8% | |||||
| 74,200 | Verizon Communications, Inc. | 3,617,250 | |||
| Total Value of Common Stocks (cost $184,035,609) | 99.2 | % | 195,963,312 | ||
| Other Assets, Less Liabilities | .8 | 1,590,551 | |||
| Net Assets | 100.0 | % | $197,553,863 | ||
| * | Non-income producing |
| 80 |
| Expiration | Exercise | |||
| CALL OPTIONS WRITTEN—1.4% | Date | Price | Contracts | Value |
| Allergan, PLC | 4/21/17 | $245.00 | 347 | $ 71,482 |
| American Express Company | 4/21/17 | 80.00 | 619 | 73,661 |
| Amgen, Inc. | 4/21/17 | 165.00 | 225 | 46,125 |
| Apple, Inc. | 4/21/17 | 142.00 | 34 | 10,064 |
| Apple, Inc. | 5/19/17 | 145.00 | 657 | 233,235 |
| AutoZone, Inc. | 4/21/17 | 740.00 | 52 | 31,096 |
| Bank of America Corporation | 4/21/17 | 23.50 | 2,437 | 158,405 |
| Bank of America Corporation | 5/5/17 | 24.50 | 414 | 18,630 |
| BlackRock, Inc. | 4/21/17 | 400.00 | 16 | 2,624 |
| BlackRock, Inc. | 4/21/17 | 410.00 | 135 | 10,800 |
| BlackRock, Inc. | 6/16/17 | 390.00 | 8 | 7,544 |
| Bristol-Myers Squibb Company | 9/15/17 | 60.00 | 734 | 110,100 |
| CBS Corporation | 5/19/17 | 67.50 | 645 | 214,785 |
| Chevron Corporation. | 4/21/17 | 110.00 | 481 | 20,683 |
| Chevron Corporation. | 4/21/17 | 115.00 | 29 | 116 |
| Cisco Systems, Inc. | 4/21/17 | 34.00 | 124 | 2,232 |
| Cisco Systems, Inc. | 5/19/17 | 34.00 | 2,068 | 136,488 |
| Dow Chemical Company | 4/21/17 | 64.00 | 75 | 6,000 |
| Dow Chemical Company | 4/21/17 | 65.00 | 1,474 | 57,486 |
| Express Scripts Holding Company | 4/21/17 | 65.00 | 186 | 37,200 |
| Express Scripts Holding Company | 6/16/17 | 70.00 | 31 | 3,782 |
| ExxonMobil Corporation | 1/19/18 | 85.00 | 23 | 6,532 |
| ExxonMobil Corporation | 1/19/18 | 87.50 | 452 | 87,688 |
| General Electric Company | 4/21/17 | 30.00 | 1,269 | 43,146 |
| General Electric Company | 4/21/17 | 31.00 | 723 | 5,784 |
| General Mills, Inc. | 7/21/17 | 60.00 | 32 | 5,120 |
| General Mills, Inc. | 7/21/17 | 62.50 | 631 | 50,480 |
| Goldman Sachs Group, Inc. | 4/21/17 | 235.00 | 42 | 11,634 |
| Goldman Sachs Group, Inc. | 4/21/17 | 250.00 | 269 | 9,415 |
| Goldman Sachs Group, Inc. | 4/28/17 | 235.00 | 15 | 5,625 |
| Goldman Sachs Group, Inc. | 4/28/17 | 250.00 | 17 | 1,105 |
| Halliburton Company | 4/21/17 | 50.00 | 129 | 9,675 |
| Halliburton Company | 4/28/17 | 54.00 | 1,103 | 26,472 |
| Honeywell International, Inc. | 4/21/17 | 125.00 | 31 | 6,107 |
| Honeywell International, Inc. | 6/16/17 | 130.00 | 609 | 123,018 |
| Intel Corporation | 4/21/17 | 35.00 | 1,016 | 122,936 |
| Intel Corporation | 4/21/17 | 35.50 | 661 | 56,846 |
| JPMorgan Chase & Company | 4/21/17 | 87.50 | 968 | 151,976 |
| 81 |
Portfolio of Investments (continued)
COVERED CALL STRATEGY FUND
March 31, 2017
| Expiration | Exercise | |||
| CALL OPTIONS WRITTEN (continued) | Date | Price | Contracts | Value |
| Lockheed Martin Corporation | 4/21/17 | $270.00 | 139 | $ 36,140 |
| Lockheed Martin Corporation | 4/28/17 | 270.00 | 17 | 6,885 |
| Medtronic, PLC | 4/21/17 | 82.00 | 407 | 17,908 |
| Medtronic, PLC | 4/21/17 | 82.50 | 474 | 12,798 |
| Mondelez International, Inc. | 4/7/17 | 44.50 | 905 | 7,240 |
| Mondelez International, Inc. | 4/21/17 | 44.00 | 46 | 2,300 |
| Oracle Corporation | 4/21/17 | 45.00 | 72 | 1,872 |
| Oracle Corporation | 7/21/17 | 47.00 | 1,418 | 97,842 |
| Pfizer, Inc. | 4/21/17 | 34.00 | 2,027 | 109,458 |
| QUALCOMM, Inc | 4/21/17 | 60.00 | 985 | 113,275 |
| Raytheon Company | 4/21/17 | 155.00 | 470 | 39,010 |
| Raytheon Company | 5/19/17 | 155.00 | 24 | 5,688 |
| U.S. Bancorp | 4/21/17 | 53.00 | 46 | 1,656 |
| U.S. Bancorp | 4/21/17 | 54.00 | 912 | 18,240 |
| United Parcel Service, Inc | 4/28/17 | 108.00 | 356 | 64,080 |
| Valero Energy Corporation | 4/13/17 | 68.50 | 913 | 25,564 |
| Valero Energy Corporation | 4/21/17 | 67.50 | 46 | 3,220 |
| Verizon Communications, Inc | 4/21/17 | 50.00 | 76 | 1,064 |
| Verizon Communications, Inc | 6/16/17 | 50.00 | 36 | 2,412 |
| Verizon Communications, Inc | 6/16/17 | 52.50 | 630 | 10,710 |
| Walt Disney Company | 4/21/17 | 113.00 | 17 | 2,533 |
| Walt Disney Company | 5/19/17 | 115.00 | 340 | 63,240 |
| Whirlpool Corporation | 5/19/17 | 175.00 | 265 | 113,950 |
| Whirlpool Corporation | 6/16/17 | 185.00 | 16 | 3,280 |
| Total Value of Call Options Written (premium received $4,044,841) | $2,736,462 | |||
| 82 |
The Fund’s assets and liabilities are classified into the following three levels based on the inputs used to value the assets and liabilities:
| Level 1 — Unadjusted quoted prices in active markets for identical securities that the Fund has the ability to access. |
| Level 2 — Observable inputs other than quoted prices included in Level 1 that are observable for the asset or liability, either directly or indirectly. These inputs may include quoted prices for the identical instrument on an inactive market, prices for similar instruments, interest rates, prepayment speeds, credit risk, yield curves, default rates and similar data. |
| Level 3 — Unobservable inputs for the asset or liability, to the extent relevant observable inputs are not available, representing the Fund’s own assumption about the assumptions a market participant would use in valuing the asset or liability, and would be based on the best information available. |
The inputs methodology used for valuing securities are not necessarily an indication of the risk associated with investing in those securities. For example, U.S. Government securities are reflected as Level 2 because the inputs used to determine fair value may not always be quoted prices in an active market.
The following is a summary, by category of Level, of inputs used to value the Fund’s investments as of March 31, 2017:
| Level 1 | Level 2 | Level 3 | Total | |||||||||
| Assets | ||||||||||||
| Common Stocks* | $ | 195,963,312 | $ | — | $ | — | $ | 195,963,312 | ||||
| Liabilities | ||||||||||||
| Call Options Written | $ | (2,736,462) | $ | — | $ | — | $ | (2,736,462) |
| * | The Portfolio of Investments provides information on the industry categorization for common stocks. |
| There were no transfers into or from Level 1 and Level 2 by the Fund for the period ended March 31, | |
| 2017. Transfers, if any, between Levels are recognized at the end of the reporting period. |
| See notes to financial statements | 83 |
Fund Expenses (unaudited)
EQUITY INCOME FUND
The examples below show the ongoing costs (in dollars) of investing in your Fund and will help you in comparing these costs with costs of other mutual funds. Please refer to page 6 for a detailed explanation of the information presented in these examples.
| Annualized | Beginning | Ending | Expenses Paid | |
| Expense | Account Value | Account Value | During Period | |
| Expense Example | Ratio | (10/1/16) | (3/31/17) | (10/1/16–3/31/17)* |
| Class A Shares | 1.21% | |||
| Actual | $1,000.00 | $1,081.30 | $ 6.28 | |
| Hypothetical** | $1,000.00 | $1,018.90 | $ 6.09 | |
| Class B Shares | 2.03% | |||
| Actual | $1,000.00 | $1,077.86 | $10.52 | |
| Hypothetical** | $1,000.00 | $1,014.81 | $10.20 | |
| Advisor Class Shares | 0.85% | |||
| Actual | $1,000.00 | $1,082.89 | $ 4.41 | |
| Hypothetical** | $1,000.00 | $1,020.69 | $ 4.28 | |
| Institutional Class Shares | 0.81% | |||
| Actual | $1,000.00 | $1,083.49 | $ 4.21 | |
| Hypothetical** | $1,000.00 | $1,020.89 | $ 4.08 | |
| * | Expenses are equal to the annualized expense ratio, multiplied by the average account value over |
| the period, multiplied by 182/365 (to reflect the one-half year period). | |
| ** | Assumed rate of return of 5% before expenses. |
Portfolio Composition
TOP TEN SECTORS
| Portfolio holdings and allocations are subject to change. Percentages are as of March 31, 2017, and |
| are based on the total market value of investments. |
| 84 |
Portfolio of Investments
EQUITY INCOME FUND
March 31, 2017
| Shares | Security | Value | |
| COMMON STOCKS—94.2% | |||
| Consumer Discretionary—9.4% | |||
| 86,000 | Acushnet Holdings Corporation | $ 1,486,080 | |
| 65,000 | American Eagle Outfitters, Inc. | 911,950 | |
| 45,568 | CBS Corporation – Class “B” | 3,160,596 | |
| 185,400 | Comcast Corporation – Special Shares “A” | 6,969,186 | |
| 20,000 | Delphi Automotive, PLC | 1,609,800 | |
| 268,500 | Ford Motor Company | 3,125,340 | |
| 47,200 | Home Depot, Inc. | 6,930,376 | |
| 128,461 | Johnson Controls International, PLC | 5,410,777 | |
| 30,000 | L Brands, Inc. | 1,413,000 | |
| 36,100 | McDonald’s Corporation | 4,678,921 | |
| 88,950 | Newell Brands, Inc. | 4,195,772 | |
| 35,000 | Oxford Industries, Inc. | 2,004,100 | |
| 122,300 | Regal Entertainment Group – Class “A” | 2,761,534 | |
| 57,933 | Time Warner, Inc. | 5,660,633 | |
| 33,500 | Tupperware Brands Corporation | 2,101,120 | |
| 21,900 | Walt Disney Company | 2,483,241 | |
| 6,800 | Whirlpool Corporation | 1,165,044 | |
| 29,000 | Wyndham Worldwide Corporation | 2,444,410 | |
| 58,511,880 | |||
| Consumer Staples—9.6% | |||
| 110,100 | AdvancePierre Foods Holdings, Inc. | 3,431,817 | |
| 125,000 | Altria Group, Inc. | 8,927,500 | |
| 92,200 | Coca-Cola Company | 3,912,968 | |
| 61,700 | CVS Health Corporation | 4,843,450 | |
| 20,000 | Dr. Pepper Snapple Group, Inc. | 1,958,400 | |
| 33,300 | Kimberly-Clark Corporation | 4,383,279 | |
| 109,117 | Koninklijke Ahold Delhaize NV (ADR) | 2,339,468 | |
| 18,066 | Kraft Heinz Company | 1,640,573 | |
| 18,000 | Molson Coors Brewing Company | 1,722,780 | |
| 63,500 | PepsiCo, Inc. | 7,103,110 | |
| 84,500 | Philip Morris International, Inc. | 9,540,050 | |
| 71,400 | Procter & Gamble Company | 6,415,290 | |
| 54,400 | Wal-Mart Stores, Inc. | 3,921,152 | |
| 60,139,837 | |||
| Energy—7.4% | |||
| 89,400 | Chevron Corporation | 9,598,878 | |
| 81,500 | ConocoPhillips | 4,064,405 | |
| 73,000 | Devon Energy Corporation | 3,045,560 | |
| 85 |
Portfolio of Investments (continued)
EQUITY INCOME FUND
March 31, 2017
| Shares | Security | Value | |
| Energy (continued) | |||
| 77,900 | ExxonMobil Corporation | $ 6,388,579 | |
| 44,600 | Halliburton Company | 2,194,766 | |
| 75,400 | Marathon Petroleum Corporation | 3,810,716 | |
| 82,500 | Occidental Petroleum Corporation | 5,227,200 | |
| 82,200 | PBF Energy, Inc. – Class “A” | 1,822,374 | |
| 75,500 | Royal Dutch Shell, PLC – Class “A” (ADR) | 3,981,115 | |
| 35,000 | Schlumberger, Ltd. | 2,733,500 | |
| 106,300 | Suncor Energy, Inc. | 3,268,725 | |
| 46,135,818 | |||
| Financials—17.5% | |||
| 151,800 | AllianceBernstein Holding, LP (MLP) | 3,468,630 | |
| 53,000 | American Express Company | 4,192,830 | |
| 55,000 | American International Group, Inc. | 3,433,650 | |
| 21,300 | Ameriprise Financial, Inc. | 2,762,184 | |
| 115,000 | Bank of New York Mellon Corporation | 5,431,450 | |
| 113,400 | Berkshire Hills Bancorp, Inc. | 4,088,070 | |
| 70,010 | Chubb, Ltd. | 9,538,863 | |
| 117,000 | Citizens Financial Group, Inc. | 4,042,350 | |
| 75,000 | Discover Financial Services | 5,129,250 | |
| 150,000 | Financial Select Sector SPDR Fund (ETF) | 3,559,500 | |
| 1,600 | * | Hamilton Lane, Inc. – Class “A” | 29,872 |
| 41,300 | IBERIABANK Corporation | 3,266,830 | |
| 72,100 | Invesco, Ltd. | 2,208,423 | |
| 95,000 | iShares S&P U.S. Preferred Stock Index Fund (ETF) | 3,676,500 | |
| 132,800 | JPMorgan Chase & Company | 11,665,152 | |
| 120,000 | MetLife, Inc. | 6,338,400 | |
| 47,900 | PNC Financial Services Group, Inc. | 5,759,496 | |
| 30,000 | Prosperity Bancshares, Inc. | 2,091,300 | |
| 49,000 | SPDR S&P Regional Banking (ETF) | 2,675,890 | |
| 134,300 | Sterling Bancorp | 3,182,910 | |
| 27,800 | Travelers Companies, Inc. | 3,351,012 | |
| 108,300 | U.S. Bancorp | 5,577,450 | |
| 90,000 | Waddell & Reed Financial, Inc. – Class “A” | 1,530,000 | |
| 215,500 | Wells Fargo & Company | 11,994,730 | |
| 108,994,742 | |||
| Health Care—10.5% | |||
| 96,100 | Abbott Laboratories | 4,267,801 | |
| 81,100 | AbbVie, Inc. | 5,284,476 | |
| 43,468 | Baxter International, Inc. | 2,254,251 | |
| 86 |
| Shares | Security | Value | |
| Health Care (continued) | |||
| 45,500 | Gilead Sciences, Inc. | $ 3,090,360 | |
| 52,400 | GlaxoSmithKline, PLC (ADR) | 2,209,184 | |
| 101,900 | Johnson & Johnson | 12,691,645 | |
| 55,094 | Medtronic, PLC | 4,438,373 | |
| 170,211 | Merck & Company, Inc. | 10,815,207 | |
| 384,124 | Pfizer, Inc. | 13,140,882 | |
| 85,000 | Phibro Animal Health Corporation – Class “A” | 2,388,500 | |
| 15,500 | Thermo Fisher Scientific, Inc. | 2,380,800 | |
| 44,452 | Zoetis, Inc. | 2,372,403 | |
| 65,333,882 | |||
| Industrials—10.7% | |||
| 28,600 | 3M Company | 5,472,038 | |
| 25,400 | A.O. Smith Corporation | 1,299,464 | |
| 65,000 | Eaton Corporation, PLC | 4,819,750 | |
| 16,800 | General Dynamics Corporation | 3,144,960 | |
| 341,400 | General Electric Company | 10,173,720 | |
| 61,900 | Honeywell International, Inc. | 7,729,453 | |
| 70,000 | Industrial Select Sector SPDR Fund (ETF) | 4,554,200 | |
| 51,100 | Ingersoll-Rand, PLC | 4,155,452 | |
| 31,450 | ITT, Inc. | 1,290,079 | |
| 100,000 | Koninklijke Philips NV (ADR) | 3,211,000 | |
| 19,000 | Lockheed Martin Corporation | 5,084,400 | |
| 40,000 | Nielsen Holdings, PLC | 1,652,400 | |
| 28,000 | Snap-On, Inc. | 4,722,760 | |
| 43,700 | United Parcel Service, Inc. – Class “B” | 4,689,010 | |
| 42,500 | United Technologies Corporation | 4,768,925 | |
| 66,767,611 | |||
| Information Technology—14.5% | |||
| 44,900 | Apple, Inc. | 6,450,334 | |
| 120,000 | Applied Materials, Inc. | 4,668,000 | |
| 28,600 | Automatic Data Processing, Inc. | 2,928,354 | |
| 17,000 | Broadcom, Ltd. | 3,722,320 | |
| 342,100 | Cisco Systems, Inc. | 11,562,980 | |
| 75,000 | HP Enterprise Company | 1,777,500 | |
| 140,000 | HP, Inc. | 2,503,200 | |
| 174,700 | Intel Corporation | 6,301,429 | |
| 60,000 | Juniper Networks, Inc. | 1,669,800 | |
| 24,600 | Lam Research Corporation | 3,157,656 | |
| 57,600 | Microchip Technology, Inc. | 4,249,728 | |
| 87 |
Portfolio of Investments (continued)
EQUITY INCOME FUND
March 31, 2017
| Shares | Security | Value | |
| Information Technology (continued) | |||
| 225,000 | Microsoft Corporation | $ 14,818,500 | |
| 25,000 | * | NXP Semiconductors NV | 2,587,500 |
| 100,300 | QUALCOMM, Inc. | 5,751,202 | |
| 90,000 | Silicon Motion Technology Corporation (ADR) | 4,207,500 | |
| 118,300 | Symantec Corporation | 3,629,444 | |
| 39,200 | TE Connectivity, Ltd. | 2,922,360 | |
| 57,000 | Technology Select Sector SPDR Fund (ETF) | 3,038,670 | |
| 50,000 | Western Digital Corporation | 4,126,500 | |
| 90,072,977 | |||
| Materials—4.5% | |||
| 86,900 | Dow Chemical Company | 5,521,626 | |
| 57,600 | DuPont (E.I.) de Nemours & Company | 4,627,008 | |
| 132,300 | * | Ferro Corporation | 2,009,637 |
| 50,500 | International Paper Company | 2,564,390 | |
| 50,000 | * | Louisiana-Pacific Corporation | 1,241,000 |
| 41,700 | LyondellBasell Industries NV – Class “A” | 3,802,623 | |
| 28,000 | Praxair, Inc. | 3,320,800 | |
| 53,600 | Sealed Air Corporation | 2,335,888 | |
| 20,000 | Steel Dynamics, Inc. | 695,200 | |
| 32,500 | WestRock Company | 1,690,975 | |
| 27,809,147 | |||
| Real Estate—2.9% | |||
| 146,400 | Brixmor Property Group, Inc. (REIT) | 3,141,744 | |
| 88,000 | Chesapeake Lodging Trust (REIT) | 2,108,480 | |
| 14,200 | Federal Realty Investment Trust (REIT) | 1,895,700 | |
| 46,000 | iShares U.S. Real Estate ETF (ETF) | 3,610,540 | |
| 95,000 | Sunstone Hotel Investors, Inc. (REIT) | 1,456,350 | |
| 80,500 | Tanger Factory Outlet Centers, Inc. (REIT) | 2,637,985 | |
| 151,800 | Urstadt Biddle Properties, Inc. – Class “A” (REIT) | 3,121,008 | |
| 17,971,807 | |||
| Telecommunication Services—3.5% | |||
| 260,730 | AT&T, Inc. | 10,833,332 | |
| 222,800 | Verizon Communications, Inc. | 10,861,500 | |
| 21,694,832 | |||
| 88 |
| Shares or | |||
| Principal | |||
| Amount | Security | Value | |
| Utilities—3.7% | |||
| 36,500 | American Electric Power Company, Inc. | $ 2,450,245 | |
| 100,000 | CenterPoint Energy, Inc. | 2,757,000 | |
| 35,000 | Dominion Resources, Inc. | 2,714,950 | |
| 35,000 | Duke Energy Corporation | 2,870,350 | |
| 113,000 | Exelon Corporation | 4,065,740 | |
| 17,100 | NextEra Energy, Inc. | 2,195,127 | |
| 105,000 | PPL Corporation | 3,925,950 | |
| 41,200 | Vectren Corporation | 2,414,732 | |
| 23,394,094 | |||
| Total Value of Common Stocks (cost $402,941,262) | 586,826,627 | ||
| PREFERRED STOCKS—1.5% | |||
| Financials—.6% | |||
| 800 | Citizens Financial Group, Inc., Series A, 5.5%, 2049 | 824,000 | |
| 102,800 | JPMorgan Chase & Co., Series Y, 6.125%, 2020 | 2,726,256 | |
| 3,550,256 | |||
| Health Care—.3% | |||
| 2,600 | Allergan, PLC, Series A, 5.5%, 2018 | 2,209,428 | |
| Real Estate—.6% | |||
| 50,500 | Digital Realty Trust, Inc., Series G (REIT), 5.875%, 2049 | 1,280,175 | |
| 46,000 | Urstadt Biddle Properties, Inc., Series F (REIT), 7.125%, 2049 | 1,187,490 | |
| 49,000 | Urstadt Biddle Properties, Inc., Series G (REIT), 6.75%, 2049 | 1,261,750 | |
| 3,729,415 | |||
| Total Value of Preferred Stocks (cost $9,629,279) | 9,489,099 | ||
| SHORT-TERM U.S. GOVERNMENT AGENCY | |||
| OBLIGATIONS—3.3% | |||
| Federal Home Loan Bank: | |||
| $7,000M | 0.56%, 4/7/2017 | 6,999,468 | |
| 2,500M | 0.57%, 4/5/2017 | 2,499,905 | |
| 5,000M | 0.7%, 4/11/2017 | 4,999,245 | |
| 2,000M | 0.75%, 4/17/2017 | 1,999,472 | |
| 3,000M | 0.75%, 4/21/2017 | 2,998,980 | |
| 1,000M | 0.75%, 4/25/2017 | 999,584 | |
| Total Value of Short-Term U.S. Government | |||
| Agency Obligations (cost $20,495,798) | 20,496,654 | ||
| 89 |
Portfolio of Investments (continued)
EQUITY INCOME FUND
March 31, 2017
| Principal | |||||||
| Amount | Security | Value | |||||
| SHORT-TERM U.S. GOVERNMENT | |||||||
| OBLIGATIONS—.9% | |||||||
| U.S. Treasury Bills: | |||||||
| $4,000M | 0.447%, 4/13/2017 | $ 3,999,208 | |||||
| 2,000M | 0.721%, 4/27/2017 | 1,999,034 | |||||
| Total Value of Short-Term U.S. Government Obligations (cost $5,998,362) | 5,998,242 | ||||||
| Total Value of Investments (cost $439,064,701) | 99.9 | % | 622,810,622 | ||||
| Other Assets, Less Liabilities | .1 | 397,477 | |||||
| Net Assets | 100.0 | % | $623,208,099 | ||||
| * | Non-income producing | |
| Summary of Abbreviations: | ||
| ADR | American Depositary Receipts | |
| ETF | Exchange Traded Fund | |
| MLP | Master Limited Partnership | |
| REIT | Real Estate Investment Trust | |
| Expiration | Exercise | |||
| CALL OPTIONS WRITTEN—0.0% | Date | Price | Contracts | Value |
| Altria Group, Inc. | ||||
| (premium received $2,860) | 4/13/17 | $73.50 | 50 | $350 |
| 90 |
The Fund’s assets and liabilities are classified into the following three levels based on the inputs used to value the assets or liabilities:
| Level 1 — Unadjusted quoted prices in active markets for identical securities that the Fund has the ability to access. |
| Level 2 — Observable inputs other than quoted prices included in Level 1 that are observable for the asset or liability, either directly or indirectly. These inputs may include quoted prices for the identical instrument on an inactive market, prices for similar instruments, interest rates, prepayment speeds, credit risk, yield curves, default rates and similar data. |
| Level 3 — Unobservable inputs for the asset or liability, to the extent relevant observable inputs are not available, representing the Fund’s own assumption about the assumptions a market participant would use in valuing the asset or liability, and would be based on the best information available. |
The inputs methodology used for valuing securities are not necessarily an indication of the risk associated with investing in those securities. For example, U.S. Government securities are reflected as Level 2 because the inputs used to determine fair value may not always be quoted prices in an active market.
The following is a summary, by category of Level, of inputs used to value the Fund’s investments as of March 31, 2017:
| Level 1 | Level 2 | Level 3 | Total | |||||||||
| Common Stocks | $ | 586,826,627 | $ | — | $ | — | $ | 586,826,627 | ||||
| Preferred Stocks | 9,489,099 | — | — | 9,489,099 | ||||||||
| Short-Term U.S. Government | ||||||||||||
| Agency Obligations | — | 20,496,654 | — | 20,496,654 | ||||||||
| Short-Term U.S. Government | ||||||||||||
| Obligations | — | 5,998,242 | — | 5,998,242 | ||||||||
| Total Investments in Securities* | $ | 596,315,726 | $ | 26,494,896 | $ | — | $ | 622,810,622 | ||||
| Liabilities | ||||||||||||
| Call Options Written | $ | (350) | $ | — | $ | — | $ | (350) | ||||
| * | The Portfolio of Investments provides information on the industry categorization for common stocks |
| and preferred stocks. | |
| There were no transfers into or from Level 1 and Level 2 by the Fund for the period ended March 31, | |
| 2017. Transfers, if any, between Levels are recognized at the end of the reporting period. |
| See notes to financial statements | 91 |
Fund Expenses (unaudited)
GLOBAL FUND
The examples below show the ongoing costs (in dollars) of investing in your Fund and will help you in comparing these costs with costs of other mutual funds. Please refer to page 6 for a detailed explanation of the information presented in these examples.
| Annualized | Beginning | Ending | Expenses Paid | |
| Expense | Account Value | Account Value | During Period | |
| Expense Example | Ratio | (10/1/16) | (3/31/17) | (10/1/16–3/31/17)* |
| Class A Shares | 1.46% | |||
| Actual | $1,000.00 | $1,081.10 | $ 7.58 | |
| Hypothetical** | $1,000.00 | $1,017.65 | $ 7.34 | |
| Class B Shares | 2.25% | |||
| Actual | $1,000.00 | $1,075.58 | $11.64 | |
| Hypothetical** | $1,000.00 | $1,013.71 | $11.30 | |
| Advisor Class Shares | 1.05% | |||
| Actual | $1,000.00 | $1,082.04 | $ 5.45 | |
| Hypothetical** | $1,000.00 | $1,019.69 | $ 5.29 | |
| Institutional Class Shares | 1.01% | |||
| Actual | $1,000.00 | $1,081.79 | $ 5.24 | |
| Hypothetical** | $1,000.00 | $1,019.89 | $ 5.09 | |
| * | Expenses are equal to the annualized expense ratio, multiplied by the average account value over |
| the period, multiplied by 182/365 (to reflect the one-half year period). Expenses paid during the | |
| period are net of expenses waived. | |
| ** | Assumed rate of return of 5% before expenses. |
Portfolio Composition
TOP TEN SECTORS
| Portfolio holdings and allocations are subject to change. Percentages are as of March 31, 2017, and |
| are based on the total market value of investments. |
| 92 |
Portfolio of Investments
GLOBAL FUND
March 31, 2017
| Shares | Security | Value | |
| COMMON STOCKS—97.6% | |||
| United States—53.5% | |||
| 40,710 | Accenture, PLC – Class “A” | $ 4,880,315 | |
| 95,090 | Air Lease Corporation | 3,684,738 | |
| 35,654 | Allergan, PLC | 8,518,454 | |
| 35,208 | Alliance Data Systems Corporation | 8,766,792 | |
| 7,509 | * | Alphabet, Inc. – Class “C” | 6,229,166 |
| 5,757 | * | Amazon.com, Inc. | 5,103,811 |
| 59,324 | Apple, Inc. | 8,522,486 | |
| 43,500 | * | Atlassian Corporation, PLC – Class “A” | 1,302,825 |
| 50,882 | Baker Hughes, Inc. | 3,043,761 | |
| 118,864 | Bank of America Corporation | 2,804,002 | |
| 14,273 | * | Biogen, Inc. | 3,902,524 |
| 17,754 | BlackRock, Inc. | 6,808,836 | |
| 147,690 | Bristol-Myers Squibb Company | 8,031,382 | |
| 55,717 | Broadcom, Ltd. | 12,199,794 | |
| 54,157 | Citigroup, Inc. | 3,239,672 | |
| 67,643 | * | Cognizant Technology Solutions Corporation – Class “A” | 4,026,111 |
| 190,793 | Coty, Inc. – Class “A” | 3,459,077 | |
| 125,244 | Delphi Automotive, PLC | 10,080,890 | |
| 25,349 | * | Electronic Arts, Inc. | 2,269,242 |
| 59,425 | EOG Resources, Inc. | 5,796,909 | |
| 18,612 | Equifax, Inc. | 2,545,005 | |
| 130,819 | Estee Lauder Companies, Inc. – Class “A” | 11,092,143 | |
| 38,646 | Expedia, Inc. | 4,875,966 | |
| 59,672 | * | Facebook, Inc. – Class “A” | 8,476,408 |
| 6,970 | FedEx Corporation | 1,360,195 | |
| 26,715 | Fortive Corporation | 1,608,777 | |
| 77,200 | Fortune Brands Home & Security, Inc. | 4,697,620 | |
| 131,729 | * | Freeport-McMoRan, Inc. | 1,759,899 |
| 17,925 | General Dynamics Corporation | 3,355,560 | |
| 54,935 | Global Payments, Inc. | 4,432,156 | |
| 56,230 | * | Guidewire Software, Inc. | 3,167,436 |
| 34,686 | Hilton Worldwide Holdings, Inc. | 2,027,744 | |
| 45,413 | Honeywell International, Inc. | 5,670,721 | |
| 85,740 | * | IHS Markit, Ltd. | 3,596,793 |
| 10,590 | * | Incyte Corporation | 1,415,565 |
| 212,845 | Intel Corporation | 7,677,319 | |
| 114,516 | IntercontinentalExchange, Inc. | 6,856,073 | |
| 413,765 | Kinder Morgan, Inc. | 8,995,251 | |
| 22,211 | L Brands, Inc. | 1,046,138 | |
| 43,833 | Marriott International, Inc. | 4,128,192 | |
| 105,697 | MetLife, Inc. | 5,582,916 | |
| 93 |
Portfolio of Investments (continued)
GLOBAL FUND
March 31, 2017
| Shares | Security | Value | |
| United States (continued) | |||
| 38,320 | * | Netflix, Inc. | $ 5,664,079 |
| 132,440 | NIKE, Inc. | 7,380,881 | |
| 21,990 | Northern Trust Corporation | 1,903,894 | |
| 16,590 | Pioneer Natural Resources Company | 3,089,556 | |
| 4,500 | * | Priceline Group, Inc. | 8,009,865 |
| 20,851 | Public Storage (REIT) | 4,564,492 | |
| 9,818 | * | Regeneron Pharmaceuticals, Inc. | 3,804,573 |
| 91,109 | * | Salesforce.com, Inc. | 7,515,581 |
| 74,079 | * | ServiceNow, Inc. | 6,479,690 |
| 41,760 | * | Splunk, Inc. | 2,601,230 |
| 9,439 | * | Tesaro, Inc. | 1,452,379 |
| 6,800 | * | Ultimate Software Group, Inc. | 1,327,428 |
| 32,822 | UnitedHealth Group, Inc. | 5,383,136 | |
| 61,081 | VF Corporation | 3,357,623 | |
| 95,275 | Viacom, Inc. – Class “B” | 4,441,720 | |
| 67,107 | Visa, Inc. – Class “A” | 5,963,799 | |
| 231,050 | Wells Fargo & Company | 12,860,243 | |
| 202,828 | WisdomTree Investments, Inc. | 1,841,678 | |
| 42,095 | * | Workday, Inc. – Class “A” | 3,505,672 |
| 193,658 | * | WPX Energy, Inc. | 2,593,081 |
| 300,779,264 | |||
| United Kingdom—5.4% | |||
| 658,291 | Aviva, PLC | 4,387,782 | |
| 461,661 | Barclays, PLC | 1,302,010 | |
| 51,752 | British American Tobacco, PLC | 3,436,517 | |
| 1,934,617 | BT Group, PLC | 7,712,775 | |
| 1,921,083 | * | Glencore, PLC | 7,537,269 |
| 270,608 | WPP, PLC | 5,940,052 | |
| 30,316,405 | |||
| France—5.3% | |||
| 120,431 | Airbus Group SE | 9,164,206 | |
| 336,712 | AXA SA | 8,712,528 | |
| 76,460 | BNP Paribas SA | 5,092,276 | |
| 82,805 | Compagnie de Saint Gobain | 4,252,084 | |
| 21,444 | Essilor International SA | 2,605,637 | |
| 29,826,731 | |||
| 94 |
| Shares | Security | Value | |
| Japan—4.8% | |||
| 16,100 | Fanuc, Ltd. | $ 3,300,117 | |
| 193,540 | Itochu Corporation | 2,746,728 | |
| 116,430 | Seven & I Holdings Company, Ltd. | 4,561,822 | |
| 62,000 | SoftBank Group Corporation | 4,378,371 | |
| 106,980 | Sony Financial Holdings, Inc. | 1,719,098 | |
| 183,730 | Sumitomo Mitsui Financial Group, Inc. | 6,675,540 | |
| 89,300 | Tokio Marine Holdings, Inc. | 3,766,755 | |
| 27,148,431 | |||
| Switzerland—3.7% | |||
| 130,995 | * | ABB, Ltd. | 3,064,157 |
| 127,741 | * | Credit Suisse Group AG | 1,900,206 |
| 165,766 | * | LafargeHolcim, Ltd. | 9,797,182 |
| 83,743 | Novartis AG- Registered | 6,216,036 | |
| 20,977,581 | |||
| Germany—3.7% | |||
| 67,295 | Beiersdorf AG | 6,369,973 | |
| 46,420 | Brenntag AG | 2,602,329 | |
| 210,762 | * | Deutsche Bank AG – Registered | 3,631,191 |
| 235,401 | Vonovia SE | 8,294,710 | |
| 20,898,203 | |||
| China—3.2% | |||
| 75,221 | * | Alibaba Group Holding, Ltd. (ADR) | 8,111,080 |
| 4,364,000 | China Construction Bank Corporation | 3,509,618 | |
| 224,210 | Tencent Holdings, Ltd. | 6,427,844 | |
| 18,048,542 | |||
| Spain—3.2% | |||
| 1,938,211 | Banco Santander SA | 11,878,878 | |
| 856,079 | Iberdrola SA | 6,123,461 | |
| 18,002,339 | |||
| Netherlands—3.1% | |||
| 105,515 | * | AerCap Holdings NV | 4,850,525 |
| 43,962 | Akzo Nobel NV | 3,645,444 | |
| 211,443 | Koninklijke Ahold Delhaize | 4,524,896 | |
| 109,715 | * | Mylan NV | 4,277,788 |
| 17,298,653 | |||
| 95 |
Portfolio of Investments (continued)
GLOBAL FUND
March 31, 2017
| Shares | Security | Value | |
| Italy—2.9% | |||
| 285,530 | Assicurazioni Generali SpA | $ 4,538,604 | |
| 94,403 | Banca Generali SpA | 2,467,381 | |
| 306,236 | * | FinecoBank Banca Fineco SpA | 2,084,305 |
| 469,969 | UniCredit SpA | 7,244,716 | |
| 16,335,006 | |||
| South Korea—1.7% | |||
| 5,207 | Samsung Electronics Company, Ltd. | 9,591,720 | |
| Taiwan—1.5% | |||
| 259,085 | Taiwan Semiconductor Manufacturing Company, Ltd. | 8,508,351 | |
| Belgium—1.5% | |||
| 75,592 | Anheuser-Busch InBev SA/NV | 8,298,040 | |
| Mexico—1.2% | |||
| 331,290 | America Movil SAB de CV (ADR) | 4,694,379 | |
| 888,320 | Wal-Mart de Mexico | 2,049,723 | |
| 6,744,102 | |||
| Ireland—.9% | |||
| 68,332 | Eaton Corporation, PLC | 5,066,818 | |
| India—.8% | |||
| 1,037,417 | ICICI Bank, Ltd. | 4,423,021 | |
| Canada—.6% | |||
| 75,600 | Magna International, Inc. | 3,262,536 | |
| Hong Kong—.3% | |||
| 76,218 | Hong Kong Exchanges & Clearing, Ltd. | 1,918,322 | |
| Brazil—.2% | |||
| 139,152 | Petroleo Brasileiro SA (ADR) | 1,348,383 | |
| Turkey—.1% | |||
| 242,893 | Turkiye Garanti Bankasi AS | 592,120 | |
| Total Value of Common Stocks (cost $483,943,155) | 549,384,568 | ||
| 96 |
| Shares or | |||||||
| Principal | |||||||
| Amount | Security | Value | |||||
| RIGHTS—.1% | |||||||
| Germany | |||||||
| 194,379 | * | Deutsche Bank AG (Expires 4/6/2017) (cost $408,827) | $ 464,496 | ||||
| SHORT-TERM U.S. GOVERNMENT AGENCY | |||||||
| OBLIGATIONS—1.1% | |||||||
| United States | |||||||
| Federal Home Loan Bank: | |||||||
| $2,500M | 0.56%, 4/7/2017 | 2,499,810 | |||||
| 2,000M | 0.7%, 4/24/2017 | 1,999,206 | |||||
| 1,500M | 0.74%, 4/26/2017 | 1,499,349 | |||||
| Total Value of Short-Term U.S. Government | |||||||
| Agency Obligations (cost $5,998,101) | 5,998,365 | ||||||
| SHORT-TERM U.S. GOVERNMENT | |||||||
| OBLIGATIONS—.2% | |||||||
| United States | |||||||
| 1,000M | U.S. Treasury Bills, 0.721%, 4/27/2017 (cost $999,479) | 999,517 | |||||
| Total Value of Investments (cost $491,349,562) | 99.0 | % | 556,846,946 | ||||
| Other Assets, Less Liabilities | 1.0 | 5,711,732 | |||||
| Net Assets | 100.0 | % | $562,558,678 | ||||
| * | Non-income producing | |
| Summary of Abbreviations: | ||
| ADR | American Depositary Receipts | |
| REIT | Real Estate Investment Trust | |
The Fund’s assets and liabilities are classified into the following three levels based on the inputs used to value the assets or liabilities:
| Level 1 — Unadjusted quoted prices in active markets for identical securities that the Fund has the ability to access. |
| Level 2 — Observable inputs other than quoted prices included in Level 1 that are observable for the asset or liability, either directly or indirectly. These inputs may include quoted prices for the identical instrument on an inactive market, prices for similar instruments, interest rates, prepayment speeds, credit risk, yield curves, default rates and similar data. |
| Level 3 — Unobservable inputs for the asset or liability, to the extent relevant observable inputs are not available, representing the Fund’s own assumption about the assumptions a market participant would use in valuing the asset or liability, and would be based on the best information available. |
| 97 |
Portfolio of Investments (continued)
GLOBAL FUND
March 31, 2017
The inputs methodology used for valuing securities are not necessarily an indication of the risk associated with investing in those securities. For example, U.S. Government securities are reflected as Level 2 because the inputs used to determine fair value may not always be quoted prices in an active market.
The following is a summary, by category of Level, of inputs used to value the Fund’s investments as of March 31, 2017:
| Level 1 | Level 2 | Level 3 | Total | |||||||||
| Common Stocks | ||||||||||||
| United States | $ | 300,779,264 | $ | — | $ | — | $ | 300,779,264 | ||||
| United Kingdom | 30,316,405 | — | — | 30,316,405 | ||||||||
| France | 29,826,731 | — | — | 29,826,731 | ||||||||
| Japan | 27,148,431 | — | — | 27,148,431 | ||||||||
| Switzerland | 20,977,581 | — | — | 20,977,581 | ||||||||
| Germany | 20,898,203 | — | — | 20,898,203 | ||||||||
| China | 18,048,542 | — | — | 18,048,542 | ||||||||
| Spain | 18,002,339 | — | — | 18,002,339 | ||||||||
| Netherlands | 17,298,653 | — | — | 17,298,653 | ||||||||
| Italy | 16,335,006 | — | — | 16,335,006 | ||||||||
| South Korea | 9,591,720 | — | — | 9,591,720 | ||||||||
| Taiwan | 8,508,351 | — | — | 8,508,351 | ||||||||
| Belgium | 8,298,040 | — | — | 8,298,040 | ||||||||
| Mexico | 6,744,102 | — | — | 6,744,102 | ||||||||
| Ireland | 5,066,818 | — | — | 5,066,818 | ||||||||
| India | 4,423,021 | — | — | 4,423,021 | ||||||||
| Canada | 3,262,536 | — | — | 3,262,536 | ||||||||
| Hong Kong | 1,918,322 | — | — | 1,918,322 | ||||||||
| Brazil | 1,348,383 | — | — | 1,348,383 | ||||||||
| Turkey | 592,120 | — | — | 592,120 | ||||||||
| Rights | ||||||||||||
| Germany | 464,496 | — | — | 464,496 | ||||||||
| Short-Term U.S. Government | ||||||||||||
| Agency Obligations | — | 5,998,365 | — | 5,998,365 | ||||||||
| Short-Term U.S. Government | ||||||||||||
| Obligations | — | 999,517 | — | 999,517 | ||||||||
| Total Investments in Securities | $ | 549,849,064 | $ | 6,997,882 | $ | — | $ | 556,846,946 |
| During the period ended March 31, 2017, there were no transfers between Level 1 investments and |
| Level 2 investments that had a material inpact to the Fund. This does not include transfers between |
| Level 1 investments and Level 2 investments due to the Fund utilizing international fair value pric- |
| ing during the period (see Note 1A). Transfers, if any, between Levels are recognized at the end of the |
| reporting period. |
| 98 | See notes to financial statements |
Fund Expenses (unaudited)
GROWTH & INCOME FUND
The examples below show the ongoing costs (in dollars) of investing in your Fund and will help you in comparing these costs with costs of other mutual funds. Please refer to page 6 for a detailed explanation of the information presented in these examples.
| Annualized | Beginning | Ending | Expenses Paid | |
| Expense | Account Value | Account Value | During Period | |
| Expense Example | Ratio | (10/1/16) | (3/31/17) | (10/1/16–3/31/17)* |
| Class A Shares | 1.15% | |||
| Actual | $1,000.00 | $1,073.95 | $5.95 | |
| Hypothetical** | $1,000.00 | $1,019.20 | $5.79 | |
| Class B Shares | 1.93% | |||
| Actual | $1,000.00 | $1,070.21 | $9.96 | |
| Hypothetical** | $1,000.00 | $1,015.31 | $9.70 | |
| Advisor Class Shares | 0.79% | |||
| Actual | $1,000.00 | $1,075.89 | $4.09 | |
| Hypothetical** | $1,000.00 | $1,020.99 | $3.98 | |
| Institutional Class Shares | 0.75% | |||
| Actual | $1,000.00 | $1,076.41 | $3.88 | |
| Hypothetical** | $1,000.00 | $1,021.19 | $3.78 | |
| * | Expenses are equal to the annualized expense ratio, multiplied by the average account value over |
| the period, multiplied by 182/365 (to reflect the one-half year period). | |
| ** | Assumed rate of return of 5% before expenses. |
Portfolio Composition
TOP TEN SECTORS
| Portfolio holdings and allocations are subject to change. Percentages are as of March 31, 2017, and |
| are based on the total market value of investments. |
| 99 |
Portfolio of Investments
GROWTH & INCOME FUND
March 31, 2017
| Shares | Security | Value | |
| COMMON STOCKS—97.9% | |||
| Consumer Discretionary—17.9% | |||
| 370,400 | Acushnet Holdings Corporation | $ 6,400,512 | |
| 40,053 | Adient, PLC | 2,910,652 | |
| 359,100 | American Eagle Outfitters, Inc. | 5,038,173 | |
| 180,000 | ARAMARK Holdings Corporation | 6,636,600 | |
| 250,000 | Big Lots, Inc. | 12,170,000 | |
| 281,500 | BorgWarner, Inc. | 11,763,885 | |
| 425,000 | CBS Corporation – Class “B” | 29,478,000 | |
| 128,800 | Coach, Inc. | 5,323,304 | |
| 125,000 | Delphi Automotive, PLC | 10,061,250 | |
| 450,000 | DSW, Inc. – Class “A” | 9,306,000 | |
| 90,000 | Foot Locker, Inc. | 6,732,900 | |
| 675,000 | Ford Motor Company | 7,857,000 | |
| 180,000 | Home Depot, Inc. | 26,429,400 | |
| 90,300 | HSN, Inc. | 3,350,130 | |
| 505,530 | Johnson Controls International, PLC | 21,292,924 | |
| 255,000 | L Brands, Inc. | 12,010,500 | |
| 60,000 | Lear Corporation | 8,494,800 | |
| 230,000 | Magna International, Inc. | 9,926,800 | |
| 300,000 | * | Michaels Companies, Inc. | 6,717,000 |
| 924,450 | Newell Brands, Inc. | 43,606,306 | |
| 190,000 | Oxford Industries, Inc. | 10,879,400 | |
| 124,000 | Penske Automotive Group, Inc. | 5,804,440 | |
| 275,000 | * | Select Comfort Corporation | 6,817,250 |
| 300,000 | Tupperware Brands Corporation | 18,816,000 | |
| 160,000 | Walt Disney Company | 18,142,400 | |
| 65,000 | Whirlpool Corporation | 11,136,450 | |
| 100,000 | Wyndham Worldwide Corporation | 8,429,000 | |
| 325,531,076 | |||
| Consumer Staples—10.0% | |||
| 155,000 | AdvancePierre Foods Holdings, Inc. | 4,831,350 | |
| 480,000 | Altria Group, Inc. | 34,281,600 | |
| 275,000 | B&G Foods, Inc. | 11,068,750 | |
| 360,000 | Coca-Cola Company | 15,278,400 | |
| 290,000 | CVS Health Corporation | 22,765,000 | |
| 560,404 | Koninklijke Ahold Delhaize NV (ADR) | 12,015,062 | |
| 161,800 | Nu Skin Enterprises, Inc. – Class “A” | 8,986,372 | |
| 165,000 | PepsiCo, Inc. | 18,456,900 | |
| 100 |
| Shares | Security | Value | |
| Consumer Staples (continued) | |||
| 295,000 | Philip Morris International, Inc. | $ 33,305,500 | |
| 105,000 | Procter & Gamble Company | 9,434,250 | |
| 160,000 | Wal-Mart Stores, Inc. | 11,532,800 | |
| 181,955,984 | |||
| Energy—5.9% | |||
| 138,000 | Anadarko Petroleum Corporation | 8,556,000 | |
| 35,000 | Chevron Corporation | 3,757,950 | |
| 230,000 | ConocoPhillips | 11,470,100 | |
| 175,000 | Devon Energy Corporation | 7,301,000 | |
| 200,000 | ExxonMobil Corporation | 16,402,000 | |
| 100,000 | Hess Corporation | 4,821,000 | |
| 300,000 | Marathon Oil Corporation | 4,740,000 | |
| 355,000 | Marathon Petroleum Corporation | 17,941,700 | |
| 100,000 | Occidental Petroleum Corporation | 6,336,000 | |
| 100,000 | PBF Energy, Inc. – Class “A” | 2,217,000 | |
| 115,000 | Phillips 66 | 9,110,300 | |
| 48,300 | Schlumberger, Ltd. | 3,772,230 | |
| 350,200 | Suncor Energy, Inc. | 10,768,650 | |
| 107,193,930 | |||
| Financials—14.4% | |||
| 250,000 | American Express Company | 19,777,500 | |
| 170,000 | American International Group, Inc. | 10,613,100 | |
| 157,300 | Ameriprise Financial, Inc. | 20,398,664 | |
| 130,000 | Chubb, Ltd. | 17,712,500 | |
| 515,000 | Citizens Financial Group, Inc. | 17,793,250 | |
| 325,000 | Discover Financial Services | 22,226,750 | |
| 550,000 | Financial Select Sector SPDR Fund (ETF) | 13,051,500 | |
| 8,200 | * | Hamilton Lane, Inc. – Class “A” | 153,094 |
| 135,000 | IBERIABANK Corporation | 10,678,500 | |
| 55,000 | iShares Russell 2000 ETF (ETF) | 7,561,400 | |
| 396,730 | JPMorgan Chase & Company | 34,848,763 | |
| 240,000 | MetLife, Inc. | 12,676,800 | |
| 56,300 | Morgan Stanley | 2,411,892 | |
| 150,000 | PNC Financial Services Group, Inc. | 18,036,000 | |
| 250,000 | SPDR S&P Regional Banking (ETF) | 13,652,500 | |
| 101 |
Portfolio of Investments (continued)
GROWTH & INCOME FUND
March 31, 2017
| Shares | Security | Value | |
| Financials (continued) | |||
| 200,000 | Sterling Bancorp | $ 4,740,000 | |
| 355,000 | U.S. Bancorp | 18,282,500 | |
| 287,050 | Wells Fargo & Company | 15,977,203 | |
| 260,591,916 | |||
| Health Care—14.8% | |||
| 425,000 | Abbott Laboratories | 18,874,250 | |
| 335,000 | AbbVie, Inc. | 21,828,600 | |
| 20,000 | Allergan, PLC | 4,778,400 | |
| 240,000 | * | AMN Healthcare Services, Inc. | 9,744,000 |
| 168,669 | Baxter International, Inc. | 8,747,174 | |
| 96,000 | * | Centene Corporation | 6,840,960 |
| 320,000 | Gilead Sciences, Inc. | 21,734,400 | |
| 91,300 | Hill-Rom Holdings, Inc. | 6,445,780 | |
| 270,625 | Johnson & Johnson | 33,706,344 | |
| 9,375 | * | Mallinckrodt, PLC | 417,844 |
| 125,000 | Medtronic, PLC | 10,070,000 | |
| 325,000 | Merck & Company, Inc. | 20,650,500 | |
| 120,000 | * | Mylan NV (ADR) | 4,678,800 |
| 869,301 | Pfizer, Inc. | 29,738,787 | |
| 298,100 | Phibro Animal Health Corporation – Class “A” | 8,376,610 | |
| 64,162 | Shire, PLC (ADR) | 11,178,945 | |
| 200,000 | Thermo Fisher Scientific, Inc. | 30,720,000 | |
| 230,000 | * | VWR Corporation | 6,486,000 |
| 260,000 | Zoetis, Inc. | 13,876,200 | |
| 268,893,594 | |||
| Industrials—8.2% | |||
| 140,000 | 3M Company | 26,786,200 | |
| 360,000 | General Electric Company | 10,728,000 | |
| 209,700 | Honeywell International, Inc. | 26,185,239 | |
| 55,000 | Ingersoll-Rand, PLC | 4,472,600 | |
| 200,000 | Koninklijke Philips NV (ADR) | 6,422,000 | |
| 20,000 | Lockheed Martin Corporation | 5,352,000 | |
| 100,000 | ManpowerGroup, Inc. | 10,257,000 | |
| 130,500 | Snap-On, Inc. | 22,011,435 | |
| 45,000 | Stanley Black & Decker, Inc. | 5,979,150 | |
| 110,400 | Textainer Group Holdings, Ltd. | 1,689,120 | |
| 456,500 | Triton International, Ltd. | 11,773,135 | |
| 150,000 | United Technologies Corporation | 16,831,500 | |
| 148,487,379 | |||
| 102 |
| Shares | Security | Value | |
| Information Technology—18.0% | |||
| 310,000 | Apple, Inc. | $ 44,534,600 | |
| 350,000 | Applied Materials, Inc. | 13,615,000 | |
| 500,000 | * | ARRIS International, PLC | 13,225,000 |
| 80,000 | Broadcom, Ltd. | 17,516,800 | |
| 900,000 | Cisco Systems, Inc. | 30,420,000 | |
| 105,887 | * | Dell Technologies, Inc. – Class “V” | 6,785,239 |
| 250,000 | * | eBay, Inc. | 8,392,500 |
| 425,000 | HP Enterprise Company | 10,072,500 | |
| 583,775 | Intel Corporation | 21,056,764 | |
| 75,000 | International Business Machines Corporation | 13,060,500 | |
| 75,000 | Methode Electronics, Inc. | 3,420,000 | |
| 625,000 | Microsoft Corporation | 41,162,500 | |
| 125,000 | * | NXP Semiconductors NV | 12,937,500 |
| 350,000 | Oracle Corporation | 15,613,500 | |
| 320,000 | QUALCOMM, Inc. | 18,348,800 | |
| 280,000 | Sabre Corporation | 5,933,200 | |
| 617,200 | Symantec Corporation | 18,935,696 | |
| 85,400 | TE Connectivity, Ltd. | 6,366,570 | |
| 73,300 | Tech Data Corporation | 6,882,870 | |
| 280,000 | Travelport Worldwide, Ltd. | 3,295,600 | |
| 185,000 | Western Digital Corporation | 15,268,050 | |
| 326,843,189 | |||
| Materials—3.0% | |||
| 210,000 | International Paper Company | 10,663,800 | |
| 425,000 | * | Louisiana-Pacific Corporation | 10,548,500 |
| 60,000 | Praxair, Inc. | 7,116,000 | |
| 135,000 | RPM International, Inc. | 7,429,050 | |
| 290,000 | Sealed Air Corporation | 12,638,200 | |
| 90,000 | Trinseo SA | 6,039,000 | |
| 54,434,550 | |||
| Real Estate—2.3% | |||
| 720,100 | Brixmor Property Group, Inc. (REIT) | 15,453,346 | |
| 76,530 | Real Estate Select Sector SPDR Fund (ETF) | 2,418,348 | |
| 445,267 | Sunstone Hotel Investors, Inc. (REIT) | 6,825,943 | |
| 287,500 | Tanger Factory Outlet Centers, Inc. (REIT) | 9,421,375 | |
| 373,500 | Urstadt Biddle Properties, Inc. – Class “A” (REIT) | 7,679,160 | |
| 41,798,172 | |||
| 103 |
Portfolio of Investments (continued)
GROWTH & INCOME FUND
March 31, 2017
| Shares or | |||||||
| Principal | |||||||
| Amount | Security | Value | |||||
| Telecommunication Services—2.4% | |||||||
| 530,000 | AT&T, Inc. | $ 22,021,500 | |||||
| 425,000 | Verizon Communications, Inc. | 20,718,750 | |||||
| 42,740,250 | |||||||
| Utilities—1.0% | |||||||
| 450,000 | Exelon Corporation | 16,191,000 | |||||
| 81,200 | NiSource, Inc. | 1,931,748 | |||||
| 18,122,748 | |||||||
| Total Value of Common Stocks (cost $1,096,921,145) | 1,776,592,788 | ||||||
| SHORT-TERM U.S. GOVERNMENT AGENCY | |||||||
| OBLIGATIONS—1.5% | |||||||
| Federal Home Loan Bank: | |||||||
| $ 5,500M | 0.7%, 4/24/2017 | 5,497,817 | |||||
| 7,500M | 0.74%, 4/26/2017 | 7,496,745 | |||||
| 14,500M | 0.75%, 4/17/2017 | 14,496,172 | |||||
| Total Value of Short-Term U.S. Government | |||||||
| Agency Obligations (cost $27,488,850) | 27,490,734 | ||||||
| SHORT-TERM U.S. GOVERNMENT | |||||||
| OBLIGATIONS—.2% | |||||||
| 3,000M | U.S. Treasury Bills, 0.721%, 4/27/2017 (cost $2,998,438) | 2,998,551 | |||||
| Total Value of Investments (cost $1,127,408,433) | 99.6 | % | 1,807,082,073 | ||||
| Other Assets, Less Liabilities | .4 | 7,553,055 | |||||
| Net Assets | 100.0 | % | $1,814,635,128 | ||||
| * | Non-income producing | |
| Summary of Abbreviations: | ||
| ADR | American Depositary Receipts | |
| ETF | Exchange Traded Fund | |
| REIT | Real Estate Investment Trust | |
| 104 |
The Fund’s assets and liabilities are classified into the following three levels based on the inputs used to value the assets or liabilities:
| Level 1 — Unadjusted quoted prices in active markets for identical securities that the Fund has the ability to access. |
| Level 2 — Observable inputs other than quoted prices included in Level 1 that are observable for the asset or liability, either directly or indirectly. These inputs may include quoted prices for the identical instrument on an inactive market, prices for similar instruments, interest rates, prepayment speeds, credit risk, yield curves, default rates and similar data. |
| Level 3 — Unobservable inputs for the asset or liability, to the extent relevant observable inputs are not available, representing the Fund’s own assumption about the assumptions a market participant would use in valuing the asset or liability, and would be based on the best information available. |
The inputs methodology used for valuing securities are not necessarily an indication of the risk associated with investing in those securities. For example, U.S. Government securities are reflected as Level 2 because the inputs used to determine fair value may not always be quoted prices in an active market.
The following is a summary, by category of Level, of inputs used to value the Fund’s investments as of March 31, 2017:
| Level 1 | Level 2 | Level 3 | Total | |||||||||
| Common Stocks | $ | 1,776,592,788 | $ | — | $ | — | $ | 1,776,592,788 | ||||
| Short-Term U.S. Government | ||||||||||||
| Agency Obligations | — | 27,490,734 | — | 27,490,734 | ||||||||
| Short-Term U.S. Government | ||||||||||||
| Obligations | — | 2,998,551 | — | 2,998,551 | ||||||||
| Total Investments in Securities* | $ | 1,776,592,788 | $ | 30,489,285 | $ | — | $ | 1,807,082,073 |
| * | The Portfolio of Investments provides information on the industry categorization for common stocks. |
| There were no transfers into or from Level 1 and Level 2 by the Fund for the period ended March 31, | |
| 2017. Transfers, if any, between Levels are recognized at the end of the reporting period. |
| See notes to financial statements | 105 |
Fund Expenses (unaudited)
HEDGED U.S. EQUITY OPPORTUNITIES FUND
The examples below show the ongoing costs (in dollars) of investing in your Fund and will help you in comparing these costs with costs of other mutual funds. Please refer to page 6 for a detailed explanation of the information presented in these examples.
| Annualized | Beginning | Ending | Expenses Paid | |
| Expense | Account Value | Account Value | During Period | |
| Expense Example | Ratio | (10/1/16) | (3/31/17) | (10/1/16–3/31/17)* |
| Class A Shares | 1.75% | |||
| Actual | $1,000.00 | $1,044.40 | $8.92 | |
| Hypothetical** | $1,000.00 | $1,016.20 | $8.80 | |
| Advisor Class Shares | 1.42% | |||
| Actual | $1,000.00 | $1,046.65 | $7.25 | |
| Hypothetical** | $1,000.00 | $1,017.85 | $7.14 | |
| Institutional Class Shares | 1.31% | |||
| Actual | $1,000.00 | $1,047.64 | $6.69 | |
| Hypothetical** | $1,000.00 | $1,018.45 | $6.59 | |
| * | Expenses are equal to the annualized expense ratio, multiplied by the average account value over |
| the period, multiplied by 182/365 (to reflect the one-half year period). Expenses paid during the | |
| period are net of expenses waived. | |
| ** | Assumed rate of return of 5% before expenses. |
Portfolio Composition
TOP TEN SECTORS
| Portfolio holdings and allocations are subject to change. Percentages are as of March 31, 2017, and |
| are based on the total market value of investments. |
| 106 |
Portfolio of Investments
HEDGED U.S. EQUITY OPPORTUNITIES FUND
March 31, 2017
| Shares | Security | Value | |
| COMMON STOCKS—94.5% | |||
| Consumer Discretionary—13.6% | |||
| 2,352 | Advance Auto Parts, Inc. | $ 348,708 | |
| 605 | * | Amazon.com, Inc. | 536,357 |
| 4,386 | * | CarMax, Inc. | 259,739 |
| 3,698 | Choice Hotels International, Inc. | 231,495 | |
| 3,894 | Comcast Corporation – Special Shares “A” | 146,375 | |
| 6,226 | D.R. Horton, Inc. | 207,388 | |
| 1,189 | Delphi Automotive, PLC | 95,703 | |
| 2,131 | Expedia, Inc. | 268,868 | |
| 2,976 | General Motors Corporation | 105,231 | |
| 408,339 | * | Global Brands Group Holding, Ltd. (Hong Kong) | 43,611 |
| 4,862 | Goodyear Tire & Rubber Company | 175,032 | |
| 3,053 | Harley-Davidson, Inc. | 184,707 | |
| 6,916 | Hilton, Inc. | 404,309 | |
| 1,977 | Home Depot, Inc. | 290,283 | |
| 2,072 | John Wiley & Sons, Inc. – Class “A” | 111,474 | |
| 31,360 | * | Just Eat, PLC (United Kingdom) | 222,386 |
| 2,348 | Las Vegas Sands Corporation | 134,000 | |
| 3,719 | Lowe’s Companies, Inc. | 305,739 | |
| 4,523 | McDonald’s Corporation | 586,226 | |
| 4,767 | * | Netflix, Inc. | 704,610 |
| 10,221 | NIKE, Inc. – Class “B” | 569,616 | |
| 3,271 | * | Norwegian Cruise Line Holdings, Ltd. | 165,938 |
| 238 | NVR, Inc. | 501,437 | |
| 1,185 | * | Panera Bread Company | 310,316 |
| 346 | * | Priceline Group, Inc. | 615,870 |
| 7,743 | Sanwa Holdings Corporation (Japan) | 72,471 | |
| 6,307 | SES SA (Luxembourg) | 146,711 | |
| 473 | Sherwin-Williams Company | 146,720 | |
| 6,578 | TJX Companies, Inc. | 520,188 | |
| 7,977 | * | Toll Brothers, Inc. | 288,049 |
| 2,659 | VF Corporation | 146,165 | |
| 5,715 | Viacom, Inc. | 266,433 | |
| 2,539 | Walt Disney Company | 287,897 | |
| 9,400,052 | |||
| 107 |
Portfolio of Investments (continued)
HEDGED U.S. EQUITY OPPORTUNITIES FUND
March 31, 2017
| Shares | Security | Value | |
| Consumer Staples—7.1% | |||
| 3,661 | Altria Group, Inc. | $ 261,469 | |
| 3,174 | British American Tobacco, PLC (United Kingdom) | 210,765 | |
| 864 | Clorox Company | 116,493 | |
| 15,431 | Coca-Cola Company | 654,892 | |
| 7,592 | Colgate-Palmolive Company | 555,659 | |
| 3,900 | Costco Wholesale Corporation | 653,991 | |
| 6,280 | Coty, Inc. – Class “A” | 113,856 | |
| 1,272 | Dr. Pepper Snapple Group, Inc. | 124,554 | |
| 1,361 | Hershey Company | 148,689 | |
| 986 | Kimberly-Clark Corporation | 129,787 | |
| 1,964 | McCormick & Company, Inc. | 191,588 | |
| 13,117 | * | Monster Beverage Corporation | 605,612 |
| 2,903 | PepsiCo, Inc. | 324,730 | |
| 2,312 | Philip Morris International, Inc. | 261,025 | |
| 3,819 | Procter & Gamble Company | 343,137 | |
| 3,286 | Wal-Mart Stores, Inc. | 236,855 | |
| 4,933,102 | |||
| Energy—3.8% | |||
| 2,235 | Anadarko Petroleum Corporation | 138,570 | |
| 5,536 | Baker Hughes, Inc. | 331,164 | |
| 4,408 | Cabot Oil & Gas Corporation | 105,395 | |
| 2,915 | Canadian Natural Resources, Ltd. | 95,583 | |
| 1,470 | * | Centennial Resource Development, Inc. (PIPE) (a) | 23,249 |
| 2,358 | * | Cobalt International Energy, Inc. | 1,258 |
| 3,449 | * | Continental Resources, Inc. | 156,654 |
| 3,453 | * | Diamondback Energy, Inc. | 358,128 |
| 1,166 | ExxonMobil Corporation | 95,624 | |
| 3,114 | Halliburton Company | 153,240 | |
| 770 | Helmerich & Payne, Inc. | 51,259 | |
| 1,020 | Hess Corporation | 49,174 | |
| 3,458 | HollyFrontier Corporation | 98,000 | |
| 2,851 | Marathon Oil Corporation | 45,046 | |
| 13,292 | * | Newfield Exploration Company | 490,608 |
| 1,347 | Pioneer Natural Resources Company | 250,852 | |
| 1,917 | * | QEP Resources, Inc. | 24,365 |
| 4,955 | * | Southwestern Energy Company | 40,482 |
| 9,944 | * | Trican Well Service, Ltd. (Canada) | 30,284 |
| 2,916 | World Fuel Services Corporation | 105,705 | |
| 2,644,640 | |||
| 108 |
| Shares | Security | Value | |
| Financials—17.2% | |||
| 281 | * | Alleghany Corporation | $ 172,719 |
| 1,317 | Allstate Corporation | 107,322 | |
| 5,578 | American Express Company | 441,276 | |
| 2,880 | American International Group, Inc. | 179,798 | |
| 909 | Aon, PLC | 107,889 | |
| 3,513 | Arthur J. Gallagher & Company | 198,625 | |
| 29,063 | Bank of America Corporation | 685,596 | |
| 2,274 | * | Berkshire Hathaway, Inc. – Class “B” | 379,030 |
| 793 | BlackRock, Inc. | 304,123 | |
| 6,608 | Capital One Financial Corporation | 572,649 | |
| 4,752 | Chubb, Ltd. | 647,460 | |
| 6,264 | Citigroup, Inc. | 374,713 | |
| 11,042 | CNO Financial Group, Inc. | 226,361 | |
| 5,561 | Comerica, Inc. | 381,373 | |
| 173 | * | Credit Acceptance Corporation | 34,498 |
| 1,101 | FactSet Research Systems, Inc. | 181,566 | |
| 351 | Fairfax Financial Holdings, Ltd. (Canada) | 159,736 | |
| 224 | First Citizens Bancshares, Inc. | 75,123 | |
| 1,750 | First Republic Bank | 164,168 | |
| 3,832 | * | Hostess Brands, Inc. | 60,814 |
| 2,939 | IBERIABANK Corporation | 232,475 | |
| 3,819 | M & T Bank Corporation | 590,914 | |
| 550 | * | Markel Corporation | 536,723 |
| 6,571 | Marsh & McLennan Companies, Inc. | 485,531 | |
| 6,862 | MetLife, Inc. | 362,451 | |
| 562 | Moody’s Corporation | 62,967 | |
| 4,496 | * | Ocelot Partners, Ltd. | 44,376 |
| 11,518 | PNC Financial Services Group, Inc. | 1,384,924 | |
| 1,751 | Principal Financial Group | 110,506 | |
| 2,339 | Progressive Corporation | 91,642 | |
| 1,409 | Raymond James Financial, Inc. | 107,450 | |
| 1,776 | Reinsurance Group of America, Inc. | 225,516 | |
| 10,003 | Synchrony Financial | 343,103 | |
| 929 | TD Ameritrade Holding Corporation | 36,101 | |
| 929 | Travelers Companies, Inc. | 111,982 | |
| 6,971 | Unum Group | 326,870 | |
| 6,547 | Wells Fargo & Company | 364,406 | |
| 165 | White Mountains Insurance Group, Ltd. | 145,180 | |
| 13,326 | XL Group, Ltd. | 531,174 | |
| 7,897 | Zions Bancorporation | 331,674 | |
| 11,880,804 | |||
| 109 |
Portfolio of Investments (continued)
HEDGED U.S. EQUITY OPPORTUNITIES FUND
March 31, 2017
| Shares | Security | Value | |
| Health Care—11.5% | |||
| 2,238 | * | ABIOMED, Inc. | $ 280,198 |
| 4,090 | * | Acadia Healthcare Company, Inc. | 178,324 |
| 1,565 | * | Alder Biopharmaceuticals, Inc. | 32,552 |
| 3,832 | * | Align Technology, Inc. | 439,569 |
| 3,774 | * | Alkermes, PLC (Ireland) | 220,779 |
| 674 | Allergan, PLC | 161,032 | |
| 924 | Becton, Dickinson and Company | 169,499 | |
| 351 | Biogen, Inc. | 95,970 | |
| 23,452 | Bristol-Myers Squibb Company | 1,275,320 | |
| 499 | C.R. Bard, Inc. | 124,021 | |
| 4,107 | Cardinal Health, Inc. | 334,926 | |
| 4,237 | * | Edwards Lifesciences Corporation | 398,575 |
| 743 | Eli Lilly & Company | 62,494 | |
| 5,921 | * | Envision Healthcare Corporation | 363,076 |
| 1,396 | * | Incyte Corporation | 186,603 |
| 1,897 | * | Ionis Pharmaceuticals, Inc. | 76,259 |
| 3,832 | Johnson & Johnson | 477,276 | |
| 1,426 | * | Laboratory Corporation of America Holdings | 204,588 |
| 3,432 | McKesson Corporation | 508,828 | |
| 9,220 | Medtronic, PLC | 742,763 | |
| 3,380 | Merck & Company, Inc. | 214,765 | |
| 440 | Mettler-Toledo International | 210,720 | |
| 4,581 | * | Mylan NV (Netherlands) | 178,613 |
| 707 | Regeneron Pharmaceutical, Inc. | 273,970 | |
| 1,250 | STERIS, PLC | 86,825 | |
| 1,237 | * | Tesaro, Inc. | 190,337 |
| 2,324 | Teva Pharmaceutical Industries, Ltd. (Israel) | 74,577 | |
| 1,683 | UnitedHealth Group, Inc. | 276,029 | |
| 720 | * | Vertex Pharmaceuticals, Inc. | 78,732 |
| 7,917,220 | |||
| Industrials—12.4% | |||
| 1,104 | 3M Company | 211,228 | |
| 2,364 | Alaska Air Group, Inc. | 218,008 | |
| 4,920 | Allison Transmission Holdings, Inc. | 177,415 | |
| 367 | AMERCO | 139,897 | |
| 7,133 | Canadian National Railway Company (Canada) | 526,507 | |
| 2,098 | Cintas Corporation | 265,481 | |
| 3,043 | * | Clean Harbors, Inc. | 169,252 |
| 6,240 | CSX Corporation | 290,472 | |
| 1,798 | Danaher Corporation | 153,783 | |
| 1,301 | Eaton Corporation, PLC | 96,469 | |
| 110 |
| Shares | Security | Value | |
| Industrials (continued) | |||
| 1,495 | Equifax, Inc. | $ 204,426 | |
| 1,103 | Expeditors International of Washington, Inc. | 62,308 | |
| 10,982 | Fastenal Company | 565,573 | |
| 5,689 | * | General Electric Company | 169,532 |
| 10,058 | Genesee & Wyoming, Inc. | 682,536 | |
| 3,090 | Herman Miller, Inc. | 97,490 | |
| 1,466 | Honeywell International, Inc. | 183,059 | |
| 586 | Hubbell, Inc. | 70,349 | |
| 2,513 | IDEX Corporation | 234,991 | |
| 946 | Illinois Tool Works, Inc. | 125,317 | |
| 952 | J.B. Hunt Transport Services, Inc. | 87,337 | |
| 6,812 | Knight Transportation, Inc. | 213,556 | |
| 1,948 | Lennox International, Inc. | 325,900 | |
| 1,421 | Lockheed Martin Corporation | 380,260 | |
| 2,566 | * | Middleby Corporation | 350,131 |
| 1,166 | * | Moog, Inc. | 78,530 |
| 1,135 | MSC Industrial Direct Company, Inc. – Class “A” | 116,633 | |
| 390 | Northrop Grumman Corporation | 92,758 | |
| 3,112 | PACCAR, Inc. | 209,126 | |
| 1,188 | Republic Services, Inc. | 74,618 | |
| 2,184 | Southwest Airlines Company | 117,412 | |
| 6,203 | Steelcase, Inc. | 103,900 | |
| 7,347 | * | TransUnion | 281,757 |
| 878 | UniFirst Corporation | 124,193 | |
| 3,636 | Union Pacific Corporation | 385,125 | |
| 6,067 | United Parcel Service, Inc. – Class “B” | 650,989 | |
| 1,596 | United Technologies Corporation | 179,087 | |
| 1,483 | Waste Management, Inc. | 108,140 | |
| 8,523,545 | |||
| Information Technology—15.5% | |||
| 1,570 | Acacia Communications, Inc. | 92,033 | |
| 2,742 | Accenture, PLC – Class “A” | 328,711 | |
| 1,002 | Activision Blizzard, Inc. | 49,960 | |
| 2,991 | * | Akamai Technologies, Inc. | 178,563 |
| 1,562 | * | Alibaba Group Holding, Ltd. | 168,430 |
| 86 | * | Alphabet, Inc. – Class “A” | 72,911 |
| 1,180 | Amdocs, Ltd. | 71,968 | |
| 1,264 | Amphenol Corporation | 89,959 | |
| 2,439 | Analog Devices, Inc. | 199,876 | |
| 1,959 | ARRIS International, PLC | 51,816 | |
| 111 |
Portfolio of Investments (continued)
HEDGED U.S. EQUITY OPPORTUNITIES FUND
March 31, 2017
| Shares | Security | Value | |
| Information Technology (continued) | |||
| 2,380 | * | Arrow Electronics, Inc. | $ 174,716 |
| 4,169 | Automatic Data Processing, Inc. | 426,864 | |
| 5,859 | Booz Allen Hamilton Holdings Corporation | 207,350 | |
| 161 | Broadcom, Ltd. | 35,253 | |
| 5,930 | Cisco Systems, Inc. | 200,434 | |
| 5,417 | * | CommScope Holding Company, Inc. | 225,943 |
| 1,510 | * | CoStar Group, Inc. | 312,902 |
| 1,484 | * | Envestnet, Inc. | 47,933 |
| 4,284 | * | Facebook, Inc. – Class “A” | 608,542 |
| 849 | * | Fiserv, Inc. | 97,898 |
| 1,195 | * | FleetCor Technologies, Inc. | 180,959 |
| 12,236 | Genpact, Ltd. | 302,963 | |
| 2,989 | Global Payments, Inc. | 241,153 | |
| 2,415 | Harris Corporation | 268,717 | |
| 8,499 | IHS Markit, Ltd. | 356,533 | |
| 6,394 | Microchip Technology, Inc. | 471,749 | |
| 3,854 | * | Microsemi Corporation | 198,597 |
| 8,743 | Microsoft Corporation | 575,814 | |
| 1,608 | Motorola Solutions, Inc. | 138,642 | |
| 331 | NVIDIA Corporation | 36,056 | |
| 1,337 | Paychex, Inc. | 78,749 | |
| 2,987 | * | Qorvo, Inc. | 204,789 |
| 3,580 | QUALCOMM, Inc. | 205,277 | |
| 6,962 | ServiceNow, Inc. | 608,966 | |
| 5,809 | Silicon Motion Technology Corporation (ADR) | 271,571 | |
| 1,944 | Skyworks Solutions, Inc. | 190,473 | |
| 5,854 | SS&C Technologies Holdings, Inc. | 207,232 | |
| 6,682 | * | Trimble, Inc. | 213,891 |
| 1,397 | * | Ultimate Software Group, Inc. | 272,708 |
| 2,742 | * | VeriSign, Inc. | 238,856 |
| 945 | * | Verisk Analytics, Inc. | 76,677 |
| 3,805 | Visa, Inc. – Class “A” | 338,150 | |
| 2,055 | Western Digital Corporation | 169,599 | |
| 7,304 | Workday, Inc. – Class “A” | 608,277 | |
| 7,927 | * | Zillow Group, Inc. – Class “A” | 268,012 |
| 9,769 | * | Zillow Group, Inc. – Class “C” | 328,922 |
| 10,695,394 | |||
| 112 |
| Shares | Security | Value | |
| Materials—3.8% | |||
| 717 | Air Products & Chemicals, Inc. | $ 97,003 | |
| 1,725 | Ball Corporation | 128,099 | |
| 982 | Bemis Company, Inc. | 47,981 | |
| 5,434 | Celanese Corporation – Series “A” | 488,245 | |
| 2,237 | * | Constellium NV – Class “A” | 14,541 |
| 2,369 | CRH, PLC (Ireland) | 83,404 | |
| 7,086 | International Paper Company | 359,827 | |
| 4,531 | Methanex Corporation | 212,504 | |
| 383 | Packaging Corporation of America | 35,090 | |
| 23,095 | * | Platform Specialty Products Corporation | 300,697 |
| 790 | PPG Industries, Inc. | 83,013 | |
| 1,888 | Praxair, Inc. | 223,917 | |
| 2,215 | Reliance Steel & Aluminum Company | 177,244 | |
| 1,962 | Silgan Holdings, Inc. | 116,464 | |
| 3,400 | Westlake Chemical Corporation | 224,570 | |
| 2,592,599 | |||
| Real Estate—2.6% | |||
| 2,110 | American Tower Corporation (REIT) | 256,449 | |
| 5,813 | Annaly Mortgage Management (REIT) | 64,582 | |
| 5,137 | Columbia Property Trust, Inc. (REIT) | 114,298 | |
| 7,808 | Host Hotels & Resorts, Inc. | 145,697 | |
| 1,967 | Public Storage (REIT) | 430,596 | |
| 2,310 | PS Buisness Park, Inc. (REIT) | 265,096 | |
| 515 | Simon Property Group, Inc. (REIT) | 88,595 | |
| 16,753 | STORE Capital Corporation (REIT) | 400,062 | |
| 840 | Taubman Centers, Inc. (REIT) | 55,457 | |
| 1,820,832 | |||
| Telecommunication Services—1.1% | |||
| 7,708 | AT&T, Inc. | 320,267 | |
| 2,000 | Nippon Telegraph & Telephone Corporation (Japan) | 85,368 | |
| 6,662 | Verizon Communications, Inc. | 324,773 | |
| 730,408 | |||
| 113 |
Portfolio of Investments (continued)
HEDGED U.S. EQUITY OPPORTUNITIES FUND
March 31, 2017
| Shares | Security | Value | |||||
| Utilities—5.9% | |||||||
| 7,847 | Alliant Energy Corporation | $ 310,820 | |||||
| 2,398 | Ameren Corporation | 130,907 | |||||
| 2,508 | American Electric Power Company, Inc. | 168,362 | |||||
| 1,381 | American Water Works Company, Inc. | 107,400 | |||||
| 3,130 | CMS Energy Corporation | 140,036 | |||||
| 2,019 | Consolidated Edison, Inc. | 156,796 | |||||
| 1,698 | Dominion Resources, Inc. | 131,714 | |||||
| 2,390 | Duke Energy Corporation | 196,004 | |||||
| 1,871 | Edison International | 148,950 | |||||
| 2,548 | Eversource Energy | 149,771 | |||||
| 5,171 | Exelon Corporation | 186,053 | |||||
| 2,788 | Iberdrola SA | 79,737 | |||||
| 2,035 | NextEra Energy, Inc. | 261,233 | |||||
| 3,869 | OGE Energy Corporation | 135,338 | |||||
| 5,474 | PG&E Corporation | 363,255 | |||||
| 1,510 | Pinnacle West Capital Corporation | 125,904 | |||||
| 3,034 | Public Service Enterprise Group, Inc. | 134,558 | |||||
| 2,319 | Sempra Energy | 256,250 | |||||
| 4,089 | Southern Company | 203,550 | |||||
| 7,661 | UGI Corporation | 378,453 | |||||
| 2,166 | WEC Energy Group, Inc. | 131,325 | |||||
| 3,245 | Xcel Energy, Inc. | 144,240 | |||||
| 4,040,656 | |||||||
| Total Value of Common Stocks (cost $60,574,709) | 65,179,252 | ||||||
| WARRANTS—.0% | |||||||
| Financials | |||||||
| 4,496 | * | Ocelot Partners, Ltd. (Expires 3/8/2020) (cost $45) | 1,799 | ||||
| Total Value of Investments (cost $60,574,754) | 94.5 | % | 65,181,051 | ||||
| Other Assets, Less Liabilities | 5.5 | 3,820,506 | |||||
| Net Assets | 100.0 | % | $69,001,557 | ||||
| * | Non-income producing | |
| (a) | Securities valued at fair value (see Note 1A) | |
| Summary of Abbreviations: | ||
| ADR | American Depositary Receipts | |
| PIPE | Private Investment in Public Equity | |
| REIT | Real Estate Investment Trust | |
| 114 |
| Expiration | Exercise | |||
| PUT OPTIONS PURCHASED—.5% | Date | Price | Contracts | Value |
| S&P 500 Index | 6/16/17 | 2,100.00 | 20 | $ 13,500 |
| S&P 500 Index | 9/15/17 | 2,025.00 | 27 | 43,200 |
| S&P 500 Index | 12/15/17 | 1,975.00 | 27 | 66,420 |
| S&P 500 Index | 3/16/18 | 2,175.00 | 27 | 197,775 |
| Total Value of Put Options Purchased (premium paid $667,596) | $320,895 | |||
| Expiration | Exercise | |||
| PUT OPTIONS WRITTEN—.2% | Date | Price | Contracts | Value |
| S&P 500 Index | 6/16/17 | 1,950.00 | 20 | $ (5,700) |
| S&P 500 Index | 9/15/17 | 1,800.00 | 27 | (16,227) |
| S&P 500 Index | 12/15/17 | 1,750.00 | 27 | (30,105) |
| S&P 500 Index | 3/16/18 | 1,950.00 | 27 | (97,335) |
| Total Value of Put Options Written (premium received $330,967) | $(149,367) | |||
Futures contracts outstanding at March 31, 2017:
| Value at | Unrealized | ||||||||
| Number of | Value at | March 31, | Appreciation | ||||||
| Contracts | Type | Expiration | Trade Date | 2017 | (Depreciation) | ||||
| 94 | S&P 500 | June 2017 | $ 11,136,655 | $ 11,180,874 | $ 44,219 | ||||
| E-mini | |||||||||
| 55 | Russell 2000 | June 2017 | 3,694,288 | 3,642,970 | (51,318) | ||||
| Mini | |||||||||
| (Premium received $268) | $ (7,099) | ||||||||
| 115 |
Portfolio of Investments (continued)
HEDGED U.S. EQUITY OPPORTUNITIES FUND
March 31, 2017
The Fund’s assets and liabilities are classified into the following three levels based on the inputs used to value the assets and liabilities:
| Level 1 — Unadjusted quoted prices in active markets for identical securities that the Fund has the ability to access. |
| Level 2 — Observable inputs other than quoted prices included in Level 1 that are observable for the asset or liability, either directly or indirectly. These inputs may include quoted prices for the identical instrument on an inactive market, prices for similar instruments, interest rates, prepayment speeds, credit risk, yield curves, default rates and similar data. |
| Level 3 — Unobservable inputs for the asset or liability, to the extent relevant observable inputs are not available, representing the Fund’s own assumption about the assumptions a market participant would use in valuing the asset or liability, and would be based on the best information available. |
The inputs methodology used for valuing securities are not necessarily an indication of the risk associated with investing in those securities. For example, U.S. Government securities are reflected as Level 2 because the inputs used to determine fair value may not always be quoted prices in an active market.
The following is a summary, by category of Level, of inputs used to value the Fund’s investments as of March 31, 2017:
| Level 1 | Level 2 | Level 3 | Total | |||||||||
| Assets | ||||||||||||
| Common Stocks | $ | 65,156,003 | $ | 23,249 | $ | — | $ | 65,179,252 | ||||
| Warrants | 1,799 | — | — | 1,799 | ||||||||
| Total Investments in Securities* | $ | 65,157,802 | $ | 23,249 | $ | — | $ | 65,181,051 | ||||
| Other Assets | ||||||||||||
| Put Options Purchased | $ | 320,895 | $ | — | $ | — | $ | 320,895 | ||||
| Liabilities | ||||||||||||
| Put Options Written | $ | (149,367) | $ | — | $ | — | $ | (149,367) | ||||
| Futures Contracts | (6,831) | — | — | (6,831) | ||||||||
| Total Liabilities | $ | (156,198) | $ | — | $ | — | $ | (156,198) |
| * | The Portfolio of Investments provides information on the industry categorization for common stocks |
| and warrants. | |
| There were no transfers into or from Level 1 and Level 2 by the Fund for the period ended March 31, | |
| 2017. Transfers, if any, between Levels are recognized at the end of the reporting period. |
| 116 | See notes to financial statements |
Fund Expenses (unaudited)
INTERNATIONAL FUND
The examples below show the ongoing costs (in dollars) of investing in your Fund and will help you in comparing these costs with costs of other mutual funds. Please refer to page 6 for a detailed explanation of the information presented in these examples.
| Annualized | Beginning | Ending | Expenses Paid | |
| Expense | Account Value | Account Value | During Period | |
| Expense Example | Ratio | (10/1/16) | (3/31/17) | (10/1/16–3/31/17)* |
| Class A Shares | 1.61% | |||
| Actual | $1,000.00 | $1,020.89 | $ 8.11 | |
| Hypothetical** | $1,000.00 | $1,016.90 | $ 8.10 | |
| Class B Shares | 2.42% | |||
| Actual | $1,000.00 | $1,017.21 | $12.17 | |
| Hypothetical** | $1,000.00 | $1,012.86 | $12.14 | |
| Advisor Class Shares | 1.20% | |||
| Actual | $1,000.00 | $1,022.94 | $ 6.05 | |
| Hypothetical** | $1,000.00 | $1,018.95 | $ 6.04 | |
| Institutional Class Shares | 1.10% | |||
| Actual | $1,000.00 | $1,022.88 | $ 5.55 | |
| Hypothetical** | $1,000.00 | $1,019.45 | $ 5.54 | |
| * | Expenses are equal to the annualized expense ratio, multiplied by the average account value over |
| the period, multiplied by 182/365 (to reflect the one-half year period). | |
| ** | Assumed rate of return of 5% before expenses. |
Portfolio Composition
BY SECTOR
| Portfolio holdings and allocations are subject to change. Percentages are as of March 31, 2017, and |
| are based on the total market value of investments. |
| 117 |
Portfolio of Investments
INTERNATIONAL FUND
March 31, 2017
| Shares | Security | Value | |
| COMMON STOCKS—96.6% | |||
| United Kingdom—16.0% | |||
| 233,556 | British American Tobacco, PLC | $ 15,508,949 | |
| 56,583 | DCC, PLC | 4,980,211 | |
| 184,933 | Diageo, PLC | 5,290,917 | |
| 934,086 | Domino’s Pizza Group, PLC | 3,613,929 | |
| 2,092,703 | Lloyds Banking Group, PLC | 1,738,872 | |
| 132,466 | Reckitt Benckiser Group, PLC | 12,092,304 | |
| 329,691 | RELX NV | 6,105,780 | |
| 49,330,962 | |||
| United States—12.1% | |||
| 44,972 | Accenture, PLC – Class “A” | 5,391,243 | |
| 109,986 | MasterCard, Inc. – Class “A” | 12,370,125 | |
| 100,654 | Philip Morris International, Inc. | 11,363,837 | |
| 4,591 | * | Priceline Group, Inc. | 8,171,842 |
| 37,297,047 | |||
| India—9.0% | |||
| 705,630 | HDFC Bank, Ltd. | 15,675,777 | |
| 520,021 | Housing Development Finance Corporation, Ltd. | 12,029,315 | |
| 27,705,092 | |||
| Switzerland—8.3% | |||
| 553 | Chocoladefabriken Lindt & Spruengli AG | 3,135,866 | |
| 118,458 | Nestle SA – Registered | 9,088,501 | |
| 39,308 | Roche Holding AG – Genusscheine | 10,038,423 | |
| 214,161 | UBS Group AG | 3,427,346 | |
| 25,690,136 | |||
| France—7.8% | |||
| 195,363 | Bureau Veritas SA | 4,121,384 | |
| 32,221 | Essilor International SA | 3,915,138 | |
| 6,566 | Hermes International SCA | 3,110,756 | |
| 16,235 | L’Oreal SA | 3,120,117 | |
| 16,088 | LVMH Moet Hennessy Louis Vuitton SE | 3,532,948 | |
| 27,450 | Sodexo SA | 3,228,533 | |
| 28,636 | Teleperformance SE | 3,093,084 | |
| 24,121,960 | |||
| 118 |
| Shares | Security | Value | |
| Canada—5.9% | |||
| 217,387 | Alimentation Couche-Tard, Inc. – Class “B” | $ 9,821,116 | |
| 113,044 | Canadian National Railway Company | 8,344,098 | |
| 18,165,214 | |||
| Spain—4.6% | |||
| 54,223 | Aena SA | 8,578,454 | |
| 227,397 | Grifols SA – Class “A” | 5,577,095 | |
| 14,155,549 | |||
| Japan—4.4% | |||
| 28,810 | Daito Trust Construction Company, Ltd. | 3,958,043 | |
| 34,500 | Shimano, Inc. | 5,035,705 | |
| 189,200 | Unicharm Corporation | 4,533,288 | |
| 13,527,036 | |||
| Netherlands—4.4% | |||
| 271,817 | Unilever NV-CVA | 13,504,147 | |
| Germany—3.4% | |||
| 106,648 | SAP SE | 10,464,788 | |
| Hong Kong—3.2% | |||
| 421,343 | Link REIT (REIT) | 2,952,085 | |
| 240,012 | Tencent Holdings, Ltd. | 6,880,869 | |
| 9,832,954 | |||
| Belgium—2.9% | |||
| 81,995 | Anheuser-Busch InBev SA/NV | 9,000,923 | |
| Ireland—2.4% | |||
| 70,001 | Paddy Power Betfair, PLC | 7,505,068 | |
| Australia—2.4% | |||
| 31,590 | CSL, Ltd. | 3,024,811 | |
| 81,039 | Ramsay Health Care, Ltd. | 4,327,157 | |
| 7,351,968 | |||
| China—2.2% | |||
| 62,796 | * | Alibaba Group Holding, Ltd. (ADR) | 6,771,293 |
| 119 |
Portfolio of Investments (continued)
INTERNATIONAL FUND
March 31, 2017
| Shares or | |||||||
| Principal | |||||||
| Amount | Security | Value | |||||
| South Africa—2.0% | |||||||
| 35,976 | Naspers, Ltd. – Class “N” | $ 6,207,729 | |||||
| Taiwan—2.0% | |||||||
| 183,171 | Taiwan Semiconductor Manufacturing Company, Ltd. (ADR) | 6,015,336 | |||||
| Mexico—1.4% | |||||||
| 48,348 | Fomento Economico Mexicano SAB de CV (ADR) | 4,279,765 | |||||
| Brazil—1.2% | |||||||
| 668,577 | Ambev SA (ADR) | 3,851,003 | |||||
| Denmark—1.0% | |||||||
| 40,604 | Coloplast A/S – Class “B” | 3,170,368 | |||||
| Total Value of Common Stocks (cost $226,242,447) | 297,948,338 | ||||||
| SHORT-TERM U.S. GOVERNMENT AGENCY | |||||||
| OBLIGATIONS—3.1% | |||||||
| United States | |||||||
| Federal Home Loan Bank: | |||||||
| $4,000M | 0.57%, 4/5/2017 | 3,999,848 | |||||
| 2,500M | 0.71%, 4/21/2017 | 2,499,150 | |||||
| 1,000M | 0.75%, 4/17/2017 | 999,736 | |||||
| 2,000M | 0.75%, 4/21/2017 | 1,999,320 | |||||
| Total Value of Short-Term U.S. Government | |||||||
| Agency Obligations (cost $9,497,593) | 9,498,054 | ||||||
| SHORT-TERM U.S. GOVERNMENT | |||||||
| OBLIGATIONS—.3% | |||||||
| United States | |||||||
| 1,000M | U.S. Treasury Bills, 0.447%, 4/13/2017 (cost $999,851) | 999,802 | |||||
| Total Value of Investments (cost $236,739,891) | 100.0 | % | 308,446,194 | ||||
| Excess of Liabilities Over Other Assets | .0 | (42,561) | |||||
| Net Assets | 100.0 | % | $308,403,633 | ||||
| * | Non-income producing | |
| Summary of Abbreviations: | ||
| ADR | American Depositary Receipts | |
| REIT | Real Estate Investment Trust | |
| 120 |
The Fund’s assets and liabilities are classified into the following three levels based on the inputs used to value the assets or liabilities:
| Level 1 — Unadjusted quoted prices in active markets for identical securities that the Fund has the ability to access. |
| Level 2 — Observable inputs other than quoted prices included in Level 1 that are observable for the asset or liability, either directly or indirectly. These inputs may include quoted prices for the identical instrument on an inactive market, prices for similar instruments, interest rates, prepayment speeds, credit risk, yield curves, default rates and similar data. |
| Level 3 — Unobservable inputs for the asset or liability, to the extent relevant observable inputs are not available, representing the Fund’s own assumption about the assumptions a market participant would use in valuing the asset or liability, and would be based on the best information available. |
The inputs methodology used for valuing securities are not necessarily an indication of the risk associated with investing in those securities. For example, U.S. Government securities are reflected as Level 2 because the inputs used to determine fair value may not always be quoted prices in an active market.
The following is a summary, by category of Level, of inputs used to value the Fund’s investments as of March 31, 2017:
| Level 1 | Level 2 | Level 3 | Total | |||||||||
| Common Stocks | ||||||||||||
| United Kingdom | $ | 49,330,962 | $ | — | $ | — | $ | 49,330,962 | ||||
| United States | 37,297,047 | — | — | 37,297,047 | ||||||||
| India | 27,705,092 | — | — | 27,705,092 | ||||||||
| Switzerland | 25,690,136 | — | — | 25,690,136 | ||||||||
| France | 24,121,960 | — | — | 24,121,960 | ||||||||
| Canada | 18,165,214 | — | — | 18,165,214 | ||||||||
| Spain | 14,155,549 | — | — | 14,155,549 | ||||||||
| Japan | 13,527,036 | — | — | 13,527,036 | ||||||||
| Netherlands | 13,504,147 | — | — | 13,504,147 | ||||||||
| Germany | 10,464,788 | — | — | 10,464,788 | ||||||||
| Hong Kong | 9,832,954 | — | — | 9,832,954 | ||||||||
| Belgium | 9,000,923 | — | — | 9,000,923 | ||||||||
| Ireland | 7,505,068 | — | — | 7,505,068 | ||||||||
| Australia | 7,351,968 | — | — | 7,351,968 | ||||||||
| China | 6,771,293 | — | — | 6,771,293 | ||||||||
| South Africa | 6,207,729 | — | — | 6,207,729 | ||||||||
| Taiwan | 6,015,336 | — | — | 6,015,336 | ||||||||
| Mexico | 4,279,765 | — | — | 4,279,765 | ||||||||
| Brazil | 3,851,003 | — | — | 3,851,003 | ||||||||
| Denmark | 3,170,368 | — | — | 3,170,368 |
| 121 |
Portfolio of Investments (continued)
INTERNATIONAL FUND
March 31, 2017
| Level 1 | Level 2 | Level 3 | Total | |||||||||
| Short-Term U.S. Government | ||||||||||||
| Agency Obligations | $ | — | $ | 9,498,054 | $ | — | $ | 9,498,054 | ||||
| Short-Term U.S. Government | ||||||||||||
| Obligations | — | 999,802 | — | 999,802 | ||||||||
| Total Investments in Securities | $ | 297,948,338 | $ | 10,497,856 | $ | — | $ | 308,446,194 |
| During the period ended March 31, 2017, there were no transfers between Level 1 investments and |
| Level 2 investments that had a material inpact to the Fund. This does not include transfers between |
| Level 1 investments and Level 2 investments due to the Fund utilizing international fair value pric- |
| ing during the period (see Note 1A). Transfers, if any, between Levels are recognized at the end of |
| the reporting period. |
| 122 | See notes to financial statements |
Fund Expenses (unaudited)
LONG SHORT FUND
The examples below show the ongoing costs (in dollars) of investing in your Fund and will help you in comparing these costs with costs of other mutual funds. Please refer to page 6 for a detailed explanation of the information presented in these examples.
| Annualized | Beginning | Ending | Expenses Paid | |
| Expense | Account Value | Account Value | During Period | |
| Expense Example | Ratio | (12/1/16)* | (3/31/17) | (12/1/16–3/31/17)** |
| Class A Shares | 3.38% | |||
| Actual | $1,000.00 | $1,028.00 | $11.36 | |
| Hypothetical*** | $1,000.00 | $1,005.38 | $11.24 | |
| Advisor Class Shares | 2.79% | |||
| Actual | $1,000.00 | $1,030.00 | $ 9.39 | |
| Hypothetical*** | $1,000.00 | $1,007.33 | $ 9.28 | |
| Institutional Class Shares | 2.66% | |||
| Actual | $1,000.00 | $1,030.00 | $ 8.95 | |
| Hypothetical*** | $1,000.00 | $1,007.76 | $ 8.85 | |
| * | Commencement of operations. |
| ** | Actual expenses reflect only from the commencment of operations to the end of the period covered |
| (December 1, 2016 through March 31, 2017). Therefore expenses shown are lower than would be | |
| expected for a six-month period. Actual expenses for the six-month period will be reflected in future | |
| reports. Expenses are equal to the annualized expense ratio multiplied by the average account value | |
| over the period, multiplied by 121/365 (to reflect the inception period). Expenses paid during the | |
| period are net of expenses waived and/or assumed. | |
| *** | Assumed rate of return of 5% before expenses. |
Portfolio Composition
BY SECTOR
| Portfolio holdings and allocations are subject to change. Percentages are as of March 31, 2017, and |
| are based on the total market value of investments. |
| 123 |
Portfolio of Investments
LONG SHORT FUND
March 31, 2017
| Shares | Security | Value | |
| COMMON STOCKS—87.0% | |||
| Consumer Discretionary—14.3% | |||
| 1,001 | * | AutoZone, Inc. (a) | $ 723,773 |
| 16,431 | Comcast Corporation – Class “A” | 617,641 | |
| 7,212 | JELD-WEN Holding, Inc. | 236,914 | |
| 6,341 | Lowe’s Companies, Inc. (a) | 521,294 | |
| 2,099,622 | |||
| Consumer Staples—6.6% | |||
| 5,575 | Molson Coors Brewing Company (a) | 533,583 | |
| 5,180 | Walgreens Boots Alliance, Inc. (a) | 430,199 | |
| 963,782 | |||
| Energy—2.4% | |||
| 4,204 | Halliburton Company | 206,879 | |
| 1,861 | Schlumberger, Ltd. | 145,344 | |
| 352,223 | |||
| Financials—17.0% | |||
| 1,720 | Aon, PLC (a) | 204,147 | |
| 22,230 | Bank of America Corporation (a) | 524,406 | |
| 8,936 | Charles Schwab Corporation (a) | 364,678 | |
| 5,794 | Comerica, Inc. (a) | 397,353 | |
| 12,176 | Intercontinental Exchange, Inc. (a) | 728,977 | |
| 16,165 | TCF Financial Corporation (a) | 275,128 | |
| 2,494,689 | |||
| Health Care—11.4% | |||
| 695 | Allergan, PLC (a) | 166,049 | |
| 826 | * | BioMarin Pharmaceutical, Inc. (a) | 72,506 |
| 1,280 | * | Celgene Corporation (a) | 159,270 |
| 2,173 | Humana, Inc. (a) | 447,942 | |
| 2,791 | INC Research Inc. | 127,967 | |
| 486 | * | Incyte Corporation (a) | 64,964 |
| 2,948 | Medtronic, PLC | 237,491 | |
| 4,624 | Pfizer, Inc. | 158,187 | |
| 1,552 | Thermo Fisher Scientific, Inc. (a) | 238,387 | |
| 1,672,763 | |||
| 124 |
| Shares | Security | Value | |
| Industrials—13.5% | |||
| 3,250 | Dover Corporation (a) | $ 261,138 | |
| 2,006 | Eaton Corporation, PLC | 148,745 | |
| 2,170 | Honeywell International, Inc. (a) | 270,968 | |
| 10,240 | Johnson Controls International, PLC (a) | 431,309 | |
| 1,991 | Parker Hannifin Corporation (a) | 319,197 | |
| 2,532 | Rockwell Automation, Inc. (a) | 394,258 | |
| 1,401 | United Parcel Service, Inc. – Class “B” | 150,327 | |
| 1,975,942 | |||
| Information Technology—19.4% | |||
| 550 | * | Alphabet, Inc. – Class “C” (a) | 456,258 |
| 8,107 | Applied Materials, Inc. (a) | 315,362 | |
| 10,023 | Cisco Systems, Inc. (a) | 338,777 | |
| 10,159 | Cypress Semiconductor, Inc. (a) | 139,788 | |
| 10,333 | * | eBay, Inc. (a) | 346,879 |
| 910 | * | Facebook, Inc. – Class “A” (a) | 129,266 |
| 5,523 | Motorola Solutions, Inc. (a) | 476,193 | |
| 2,962 | * | Red Hat, Inc. (a) | 256,213 |
| 2,232 | Skyworks Solutions, Inc. (a) | 218,691 | |
| 1,992 | Visa, Inc. – Class “A” (a) | 177,029 | |
| 2,854,456 | |||
| Telecommunication Services—2.4% | |||
| 8,651 | AT&T, Inc. (a) | 359,449 | |
| Total Value of Common Stocks (cost $12,122,994) | 12,772,926 | ||
| SECURITIES SOLD SHORT—(57.5)% | |||
| Consumer Discretionary—(6.4)% | |||
| (2,289) | CalAtlantic Group, Inc. | (85,723) | |
| (967) | Dollar Tree, Inc. | (75,871) | |
| (689) | Expedia, Inc. | (86,931) | |
| (3,322) | GameStop Corporation | (74,911) | |
| (2,916) | Gap, Inc. | (70,830) | |
| (1,246) | McDonald’s Corporation | (161,494) | |
| (1,148) | Murphy USA, Inc. | (84,286) | |
| (1,486) | Newell Brands, Inc. | (70,095) | |
| (859) | Polaris Industries Inc. | (71,984) | |
| (1,450) | Starbucks Corporation | (84,665) | |
| (1,312) | Target Corporation | (72,409) | |
| (939,199) | |||
| 125 |
Portfolio of Investments (continued)
LONG SHORT FUND
March 31, 2017
| Shares | Security | Value | |
| Consumer Staples—(3.9)% | |||
| (628) | Casey’s General Stores, Inc. | $ (70,493) | |
| (2,737) | Snyders-Lance, Inc. | (110,328) | |
| (5,439) | Wal-Mart Stores, Inc. | (392,043) | |
| (572,864) | |||
| Energy—(1.4)% | |||
| (2,489) | Range Resources Corporation | (72,430) | |
| (16,890) | Southwestern Energy Company | (137,991) | |
| (210,421) | |||
| Financials—(13.7)% | |||
| (2,213) | Aflac, Inc. | (160,265) | |
| (4,192) | Federated Investors, Inc. – Class “B” | (110,417) | |
| (5,800) | Fifth Third Bancorp | (147,320) | |
| (3,115) | Franklin Resources, Inc. | (131,266) | |
| (2,114) | Glacier Bancorp, Inc. | (71,728) | |
| (14,812) | LendingClub Corporation | (81,318) | |
| (14,906) | New York Community Bancorp, Inc. | (208,237) | |
| (11,385) | People’s United Financial, Inc. | (207,207) | |
| (2,549) | Progressive Corporation | (99,870) | |
| (2,090) | T. Rowe Price Group, Inc. | (142,433) | |
| (1,986) | Travelers Companies, Inc. | (239,392) | |
| (10,330) | Umpqua Holdings Corporation | (183,254) | |
| (3,480) | Voya Financial, Inc. | (132,101) | |
| (5,783) | Waddell & Reed Financial, Inc. – Class “A” | (98,311) | |
| (2,013,119) | |||
| Health Care—(12.0)% | |||
| (798) | Amgen, Inc. | (130,928) | |
| (658) | athenahealth, Inc. | (74,150) | |
| (1,714) | Baxter International, Inc. | (88,888) | |
| (7,559) | Community Health Systems, Inc. | (67,048) | |
| (1,522) | Express Scripts Holding Company | (100,315) | |
| (3,588) | Fresenius Medical Care AG | (151,162) | |
| (2,006) | Gilead Sciences, Inc. | (136,248) | |
| (1,401) | Ligand Pharmaceuticals, Inc. | (148,282) | |
| (3,889) | Owens & Minor | (134,559) | |
| (2,755) | PAREXEL International Corporation | (173,868) | |
| (306) | Regeneron Pharmaceutical, Inc. | (118,578) | |
| 126 |
| Shares | Security | Value | |
| Health Care (continued) | |||
| (5,703) | Sanofi (ADR) | $ (258,061) | |
| (2,066) | Teva Pharmaceutical Industries, Ltd. (ADR) | (66,298) | |
| (954) | Zimmer Biomet Holdings, Inc. | (116,493) | |
| (1,764,878) | |||
| Industrials—(3.6)% | |||
| (1,293) | Boeing Company | (228,680) | |
| (1,148) | Carlisle Companies, Inc. | (122,159) | |
| (2,465) | Gentherm, Inc. | (96,751) | |
| (326) | Lockheed Martin Corporation | (87,238) | |
| (534,828) | |||
| Information Technology—(13.0)% | |||
| (512) | Alliance Data Systems Corporation | (127,488) | |
| (1,353) | Ambarella, Inc. | (74,023) | |
| (4,138) | Amdocs, Ltd. | (252,377) | |
| (3,412) | Genpact, Ltd. | (84,481) | |
| (4,040) | Intel Corporation | (145,723) | |
| (2,043) | International Business Machines Corporation | (355,768) | |
| (745) | Intuit, Inc. | (86,413) | |
| (4,132) | Oracle Corporation | (184,329) | |
| (1,281) | Paychex, Inc. | (75,451) | |
| (3,371) | PayPal Holdings, Inc. | (145,020) | |
| (4,833) | Snap, Inc. | (108,887) | |
| (8,518) | Teradata Corporation | (265,080) | |
| (1,905,040) | |||
| Materials—(1.5)% | |||
| (1,474) | Bemis Company, Inc. | (72,020) | |
| (1,401) | International Paper Company | (71,143) | |
| (1,426) | WestRock Company | (74,195) | |
| (217,358) | |||
| 127 |
Portfolio of Investments (continued)
LONG SHORT FUND
March 31, 2017
| Shares | Security | Value | |||||
| Real Estate—(2.0)% | |||||||
| (15,247) | CBL & Associates Properties, Inc. | $ (145,456) | |||||
| (1,129) | Macerich Company | (72,708) | |||||
| (1,109) | Taubman Centers, Inc. | (73,216) | |||||
| (291,380) | |||||||
| Total Value of Securities Sold Short (proceeds $8,316,045) | (8,449,087) | ||||||
| Total Value of Investments | |||||||
| (cost and short proceeds $3,086,949) | 29.5 | % | 4,323,839 | ||||
| Other Assets, Less Liabilities | 70.5 | 10,357,658 | |||||
| Net Assets | 100.0 | % | $14,681,497 | ||||
| * | Non-income producing |
| (a) | A portion or all of the security has been pledged to cover collateral requirements on securities |
| sold short. | |
| Summary of Abbreviations: | |
| ADR American Depositary Receipts |
| 128 |
The Fund’s assets and liabilities are classified into the following three levels based on the inputs used to value the assets or liabilities:
| Level 1 — Unadjusted quoted prices in active markets for identical securities that the Fund has the ability to access. |
| Level 2 — Observable inputs other than quoted prices included in Level 1 that are observable for the asset or liability, either directly or indirectly. These inputs may include quoted prices for the identical instrument on an inactive market, prices for similar instruments, interest rates, prepayment speeds, credit risk, yield curves, default rates and similar data. |
| Level 3 — Unobservable inputs for the asset or liability, to the extent relevant observable inputs are not available, representing the Fund’s own assumption about the assumptions a market participant would use in valuing the asset or liability, and would be based on the best information available. |
The inputs methodology used for valuing securities are not necessarily an indication of the risk associated with investing in those securities. For example, U.S. Government securities are reflected as Level 2 because the inputs used to determine fair value may not always be quoted prices in an active market.
The following is a summary, by category of Level, of inputs used to value the Fund’s investments as of March 31, 2017:
| Level 1 | Level 2 | Level 3 | Total | |||||||||
| Assets | ||||||||||||
| Common Stocks* | $ | 12,772,926 | $ | — | $ | — | $ | 12,772,926 | ||||
| Liabilities | ||||||||||||
| Securities Sold Short* | $ | (8,449,087) | $ | — | $ | — | $ | (8,449,087) |
| * | The Portfolio of Investments provides information on the industry categorization for common stocks |
| and securities sold short. | |
| There were no transfers into or from Level 1 or Level 2 by the Fund for the period ended March 31, | |
| 2017. Transfers, if any, between Levels are recognized at the end of the reporting period. |
| See notes to financial statements | 129 |
Fund Expenses (unaudited)
OPPORTUNITY FUND
The examples below show the ongoing costs (in dollars) of investing in your Fund and will help you in comparing these costs with costs of other mutual funds. Please refer to page 6 for a detailed explanation of the information presented in these examples.
| Annualized | Beginning | Ending | Expenses Paid | |
| Expense | Account Value | Account Value | During Period | |
| Expense Example | Ratio | (10/1/16) | (3/31/17) | (10/1/16–3/31/17)* |
| Class A Shares | 1.20% | |||
| Actual | $1,000.00 | $1,081.27 | $ 6.23 | |
| Hypothetical** | $1,000.00 | $1,018.95 | $ 6.04 | |
| Class B Shares | 1.96% | |||
| Actual | $1,000.00 | $1,077.23 | $10.15 | |
| Hypothetical** | $1,000.00 | $1,015.16 | $ 9.85 | |
| Advisor Class Shares | 0.91% | |||
| Actual | $1,000.00 | $1,082.99 | $ 4.73 | |
| Hypothetical** | $1,000.00 | $1,020.39 | $ 4.58 | |
| Institutional Class Shares | 0.78% | |||
| Actual | $1,000.00 | $1,083.88 | $ 4.05 | |
| Hypothetical** | $1,000.00 | $1,021.04 | $ 3.93 | |
| * | Expenses are equal to the annualized expense ratio, multiplied by the average account value over |
| the period, multiplied by 182/365 (to reflect the one-half year period). | |
| ** | Assumed rate of return of 5% before expenses. |
Portfolio Composition
BY SECTOR
| Portfolio holdings and allocations are subject to change. Percentages are as of March 31, 2017, and |
| are based on the total market value of investments. |
| 130 |
Portfolio of Investments
OPPORTUNITY FUND
March 31, 2017
| Shares | Security | Value | |
| COMMON STOCKS—96.5% | |||
| Consumer Discretionary—22.5% | |||
| 320,300 | Acushnet Holdings Corporation | $ 5,534,784 | |
| 313,600 | American Eagle Outfitters, Inc. | 4,399,808 | |
| 150,000 | ARAMARK Holdings Corporation | 5,530,500 | |
| 175,000 | * | Belmond, Ltd. – Class “A” | 2,117,500 |
| 160,000 | Big Lots, Inc. | 7,788,800 | |
| 181,500 | BorgWarner, Inc. | 7,584,885 | |
| 57,700 | Caleres, Inc. | 1,524,434 | |
| 124,100 | Coach, Inc. | 5,129,053 | |
| 85,000 | Delphi Automotive, PLC | 6,841,650 | |
| 366,000 | DSW, Inc. – Class “A” | 7,568,880 | |
| 80,000 | Foot Locker, Inc. | 5,984,800 | |
| 230,200 | * | Fox Factory Holding Corporation | 6,606,740 |
| 120,000 | * | Helen of Troy, Ltd. | 11,304,000 |
| 95,100 | HSN, Inc. | 3,528,210 | |
| 145,000 | L Brands, Inc. | 6,829,500 | |
| 50,000 | Lear Corporation | 7,079,000 | |
| 152,800 | * | LKQ Corporation | 4,472,456 |
| 165,000 | Magna International, Inc. | 7,121,400 | |
| 360,000 | * | Michaels Companies, Inc. | 8,060,400 |
| 658,770 | Newell Brands, Inc. | 31,074,181 | |
| 95,000 | Nordstrom, Inc. | 4,424,150 | |
| 140,000 | Oxford Industries, Inc. | 8,016,400 | |
| 129,000 | Penske Automotive Group, Inc. | 6,038,490 | |
| 25,000 | Ralph Lauren Corporation | 2,040,500 | |
| 245,100 | Ruth’s Hospitality Group, Inc. | 4,914,255 | |
| 255,000 | * | Select Comfort Corporation | 6,321,450 |
| 308,000 | * | ServiceMaster Global Holdings, Inc. | 12,859,000 |
| 420,000 | * | TRI Pointe Group, Inc. | 5,266,800 |
| 215,000 | Tupperware Brands Corporation | 13,484,800 | |
| 45,500 | Whirlpool Corporation | 7,795,515 | |
| 475,000 | * | William Lyon Homes – Class “A” | 9,794,500 |
| 70,000 | Wyndham Worldwide Corporation | 5,900,300 | |
| 232,937,141 | |||
| Consumer Staples—6.7% | |||
| 181,900 | AdvancePierre Foods Holdings, Inc. | 5,669,823 | |
| 205,000 | B&G Foods, Inc. | 8,251,250 | |
| 90,000 | * | Herbalife, Ltd. | 5,232,600 |
| 440,625 | Koninklijke Ahold Delhaize NV (ADR) | 9,447,000 | |
| 20,800 | McCormick & Company, Inc. | 2,029,040 | |
| 116,800 | Nu Skin Enterprises, Inc. – Class “A” | 6,487,072 | |
| 131 |
Portfolio of Investments (continued)
OPPORTUNITY FUND
March 31, 2017
| Shares | Security | Value | |
| Consumer Staples (continued) | |||
| 260,000 | * | Performance Food Group Company | $ 6,188,000 |
| 250,000 | Pinnacle Foods, Inc. | 14,467,500 | |
| 101,661 | Tootsie Roll Industries, Inc. | 3,797,038 | |
| 285,100 | * | U.S. Foods Holding Corporation | 7,977,098 |
| 69,546,421 | |||
| Energy—2.5% | |||
| 30,100 | * | Dril-Quip, Inc. | 1,641,955 |
| 80,000 | EOG Resources, Inc. | 7,804,000 | |
| 90,000 | EQT Corporation | 5,499,000 | |
| 85,000 | Hess Corporation | 4,097,850 | |
| 80,000 | National Oilwell Varco, Inc. | 3,207,200 | |
| 180,000 | PBF Energy, Inc. – Class “A” | 3,990,600 | |
| 26,240,605 | |||
| Financials—15.0% | |||
| 74,200 | Ameriprise Financial, Inc. | 9,622,256 | |
| 220,000 | Berkshire Hills Bancorp, Inc. | 7,931,000 | |
| 500,000 | Citizens Financial Group, Inc. | 17,275,000 | |
| 230,000 | Discover Financial Services | 15,729,700 | |
| 400,000 | Financial Select Sector SPDR Fund (ETF) | 9,492,000 | |
| 150,500 | First Republic Bank | 14,118,405 | |
| 91,250 | Great Western Bancorp, Inc. | 3,869,912 | |
| 95,000 | IBERIABANK Corporation | 7,514,500 | |
| 110,000 | iShares Core S&P Mid-Cap ETF (ETF) | 18,834,200 | |
| 135,000 | iShares Russell 2000 ETF (ETF) | 18,559,800 | |
| 120,000 | NASDAQ, Inc. | 8,334,000 | |
| 225,000 | SPDR S&P Regional Banking (ETF) | 12,287,250 | |
| 315,000 | Sterling Bancorp | 7,465,500 | |
| 225,000 | Waddell & Reed Financial, Inc. – Class “A” | 3,825,000 | |
| 154,858,523 | |||
| Health Care—12.0% | |||
| 35,000 | Allergan, PLC | 8,362,200 | |
| 135,000 | * | AMN Healthcare Services, Inc. | 5,481,000 |
| 225,000 | * | Centene Corporation | 16,033,500 |
| 100,000 | * | Charles River Laboratories International, Inc. | 8,995,000 |
| 75,000 | Dentsply Sirona, Inc. | 4,683,000 | |
| 140,000 | Gilead Sciences, Inc. | 9,508,800 | |
| 151,200 | Hill-Rom Holdings, Inc. | 10,674,720 | |
| 132 |
| Shares | Security | Value | |
| Health Care (continued) | |||
| 15,000 | McKesson Corporation | $ 2,223,900 | |
| 350,500 | Phibro Animal Health Corporation – Class “A” | 9,849,050 | |
| 230,000 | * | Prestige Brands Holdings, Inc. | 12,778,800 |
| 75,000 | Quest Diagnostics, Inc. | 7,364,250 | |
| 105,000 | Thermo Fisher Scientific, Inc. | 16,128,000 | |
| 50,000 | * | VCA, Inc. | 4,575,000 |
| 255,000 | * | VWR Corporation | 7,191,000 |
| 123,848,220 | |||
| Industrials—10.7% | |||
| 260,000 | A.O. Smith Corporation | 13,301,600 | |
| 103,600 | Apogee Enterprises, Inc. | 6,175,596 | |
| 240,000 | * | Atkore International Group, Inc. | 6,307,200 |
| 160,300 | ESCO Technologies, Inc. | 9,313,430 | |
| 65,000 | Ingersoll-Rand, PLC | 5,285,800 | |
| 82,500 | J.B. Hunt Transport Services, Inc. | 7,568,550 | |
| 247,200 | Korn/Ferry International | 7,784,328 | |
| 95,000 | ManpowerGroup, Inc. | 9,744,150 | |
| 200,000 | Masco Corporation | 6,798,000 | |
| 16,200 | Regal Beloit Corporation | 1,225,530 | |
| 29,000 | Roper Technologies, Inc. | 5,988,210 | |
| 97,700 | Snap-On, Inc. | 16,479,059 | |
| 50,000 | Stanley Black & Decker, Inc. | 6,643,500 | |
| 301,000 | Triton International, Ltd. | 7,762,790 | |
| 110,377,743 | |||
| Information Technology—13.1% | |||
| 410,000 | * | ARRIS International, PLC | 10,844,500 |
| 60,000 | Broadcom, Ltd. | 13,137,600 | |
| 90,000 | * | Fiserv, Inc. | 10,377,900 |
| 50,000 | Juniper Networks, Inc. | 1,391,500 | |
| 75,000 | Lam Research Corporation | 9,627,000 | |
| 15,000 | Methode Electronics, Inc. | 684,000 | |
| 104,200 | * | NETGEAR, Inc. | 5,163,110 |
| 270,000 | Sabre Corporation | 5,721,300 | |
| 190,000 | Silicon Motion Technology Corporation (ADR) | 8,882,500 | |
| 445,500 | Symantec Corporation | 13,667,940 | |
| 50,000 | * | Synchronoss Technologies, Inc. | 1,220,000 |
| 36,900 | TE Connectivity, Ltd. | 2,750,895 | |
| 58,200 | * | Tech Data Corporation | 5,464,980 |
| 133 |
Portfolio of Investments (continued)
OPPORTUNITY FUND
March 31, 2017
| Shares | Security | Value | |
| Information Technology (continued) | |||
| 275,000 | Technology Select Sector SPDR Fund (ETF) | $ 14,660,250 | |
| 628,000 | Travelport Worldwide, Ltd. | 7,391,560 | |
| 185,000 | Western Digital Corporation | 15,268,050 | |
| 100,000 | * | Zebra Technologies Corporation – Class “A” | 9,125,000 |
| 135,378,085 | |||
| Materials—6.7% | |||
| 200,000 | * | Berry Plastics Group, Inc. | 9,714,000 |
| 185,600 | * | Ferro Corporation | 2,819,264 |
| 132,500 | FMC Corporation | 9,220,675 | |
| 425,000 | * | Louisiana-Pacific Corporation | 10,548,500 |
| 40,000 | Praxair, Inc. | 4,744,000 | |
| 225,000 | Sealed Air Corporation | 9,805,500 | |
| 470,580 | * | Summit Materials, Inc. – Class “A” | 11,628,032 |
| 165,000 | Trinseo SA | 11,071,500 | |
| 69,551,471 | |||
| Real Estate—4.5% | |||
| 536,100 | Brixmor Property Group, Inc. (REIT) | 11,504,706 | |
| 150,000 | Douglas Emmett, Inc. (REIT) | 5,760,000 | |
| 45,000 | Federal Realty Investment Trust (REIT) | 6,007,500 | |
| 850,000 | FelCor Lodging Trust, Inc. (REIT) | 6,383,500 | |
| 55,658 | Real Estate Select Sector SPDR Fund (ETF) | 1,758,793 | |
| 410,644 | Sunstone Hotel Investors, Inc. (REIT) | 6,295,173 | |
| 261,800 | Tanger Factory Outlet Centers, Inc. (REIT) | 8,579,186 | |
| 46,288,858 | |||
| Utilities—2.8% | |||
| 4,100 | Black Hills Corporation | 272,527 | |
| 69,000 | NiSource, Inc. | 1,641,510 | |
| 144,800 | Portland General Electric Company | 6,432,016 | |
| 135,000 | SCANA Corporation | 8,822,250 | |
| 200,000 | WEC Energy Group, Inc. | 12,126,000 | |
| 29,294,303 | |||
| Total Value of Common Stocks (cost $699,971,109) | 998,321,370 | ||
| 134 |
| Principal | |||||||
| Amount | Security | Value | |||||
| SHORT-TERM U.S. GOVERNMENT AGENCY | |||||||
| OBLIGATIONS—3.2% | |||||||
| Federal Home Loan Bank: | |||||||
| $ 5,000M | 0.56%, 4/7/2017 | $ 4,999,620 | |||||
| 1,500M | 0.71%, 4/21/2017 | 1,499,490 | |||||
| 10,000M | 0.74%, 4/26/2017 | 9,995,660 | |||||
| 3,000M | 0.75%, 4/25/2017 | 2,998,752 | |||||
| 2,500M | 0.75%, 4/19/2017 | 2,499,245 | |||||
| 11,000M | 0.75%, 4/17/2017 | 10,997,096 | |||||
| Total Value of Short-Term U.S. Government | |||||||
| Agency Obligations (cost $32,987,696) | 32,989,863 | ||||||
| SHORT-TERM U.S. GOVERNMENT | |||||||
| OBLIGATIONS—.2% | |||||||
| 2,500M | U.S. Treasury Bills, 0.721%, 4/27/2017 (cost $2,498,698) | 2,498,792 | |||||
| Total Value of Investments (cost $735,457,503) | 99.9 | % | 1,033,810,025 | ||||
| Other Assets, Less Liabilities | .1 | 1,414,427 | |||||
| Net Assets | 100.0 | % | $1,035,224,452 | ||||
| * | Non-income producing | |
| Summary of Abbreviations: | ||
| ADR | American Depositary Receipts | |
| ETF | Exchange Traded Fund | |
| REIT | Real Estate Investment Trust | |
| 135 |
Portfolio of Investments (continued)
OPPORTUNITY FUND
March 31, 2017
The Fund’s assets and liabilities are classified into the following three levels based on the inputs used to value the assets or liabilities:
| Level 1 — Unadjusted quoted prices in active markets for identical securities that the Fund has the ability to access. |
| Level 2 — Observable inputs other than quoted prices included in Level 1 that are observable for the asset or liability, either directly or indirectly. These inputs may include quoted prices for the identical instrument on an inactive market, prices for similar instruments, interest rates, prepayment speeds, credit risk, yield curves, default rates and similar data. |
| Level 3 — Unobservable inputs for the asset or liability, to the extent relevant observable inputs are not available, representing the Fund’s own assumption about the assumptions a market participant would use in valuing the asset or liability, and would be based on the best information available. |
The inputs methodology used for valuing securities are not necessarily an indication of the risk associated with investing in those securities. For example, U.S. Government securities are reflected as Level 2 because the inputs used to determine fair value may not always be quoted prices in an active market.
The following is a summary, by category of Level, of inputs used to value the Fund’s investments as of March 31, 2017:
| Level 1 | Level 2 | Level 3 | Total | |||||||||
| Common Stocks | $ | 998,321,370 | $ | — | $ | — | $ | 998,321,370 | ||||
| Short-Term U.S. Government | ||||||||||||
| Agency Obligations | — | 32,989,863 | — | 32,989,863 | ||||||||
| Short-Term U.S. Government | ||||||||||||
| Obligations | — | 2,498,792 | — | 2,498,792 | ||||||||
| Total Investments in Securities* | $ | 998,321,370 | $ | 35,488,655 | $ | — | $ | 1,033,810,025 |
| * | The Portfolio of Investments provides information on the industry categorization for common stocks. |
| There were no transfers into or from Level 1 and Level 2 by the Fund for the period ended March 31, | |
| 2017. Transfers, if any, between Levels are recognized at the end of the reporting period. |
| 136 | See notes to financial statements |
Fund Expenses (unaudited)
REAL ESTATE FUND
The examples below show the ongoing costs (in dollars) of investing in your Fund and will help you in comparing these costs with costs of other mutual funds. Please refer to page 6 for a detailed explanation of the information presented in these examples.
| Annualized | Beginning | Ending | Expenses Paid | |
| Expense | Account Value | Account Value | During Period | |
| Expense Example | Ratio | (10/1/16) | (3/31/17) | (10/1/16–3/31/17)* |
| Class A Shares | 1.45% | |||
| Actual | $1,000.00 | $ 978.24 | $7.15 | |
| Hypothetical** | $1,000.00 | $1,017.70 | $7.29 | |
| Advisor Class Shares | 1.12% | |||
| Actual | $1,000.00 | $ 978.99 | $5.53 | |
| Hypothetical** | $1,000.00 | $1,019.35 | $5.64 | |
| Institutional Class Shares | 1.02% | |||
| Actual | $1,000.00 | $ 979.48 | $5.03 | |
| Hypothetical** | $1,000.00 | $1,019.84 | $5.14 | |
| * | Expenses are equal to the annualized expense ratio, multiplied by the average account value over |
| the period, multiplied by 182/365 (to reflect the one-half year period). Expenses paid during the | |
| period are net of expenses waived and/or assumed. | |
| ** | Assumed rate of return of 5% before expenses. |
Portfolio Composition
TOP TEN SECTORS
| Portfolio holdings and allocations are subject to change. Percentages are as of March 31, 2017, and |
| are based on the total market value of investments. |
| 137 |
Portfolio of Investments
REAL ESTATE FUND
March 31, 2017
| Shares | Security | Value | |
| COMMON STOCKS—98.0% | |||
| Apartments REITs—13.7% | |||
| 18,517 | Apartment Investment & Management Company – Class “A” | $ 821,229 | |
| 21,917 | AvalonBay Communities, Inc. | 4,023,961 | |
| 8,927 | Camden Property Trust | 718,266 | |
| 62,581 | Equity Residential | 3,893,790 | |
| 9,141 | Essex Property Trust, Inc. | 2,116,416 | |
| 19,696 | Mid-America Apartment Communities | 2,003,871 | |
| 8,351 | UDR, Inc. | 302,807 | |
| 13,880,340 | |||
| Diversified REITs—7.5% | |||
| 3,672 | American Tower Corporation | 446,295 | |
| 19,564 | CoreCivic, Inc. | 614,701 | |
| 3,048 | CorEnergy Infrastructure Trust, Inc. | 102,961 | |
| 1,457 | Digital Realty Trust, Inc. | 155,010 | |
| 30,516 | Duke Realty Corporation | 801,655 | |
| 2,487 | DuPont Fabros Technology, Inc. | 123,330 | |
| 35,370 | Forest City Realty Trust, Inc. | 770,359 | |
| 2,737 | Liberty Property Trust | 105,511 | |
| 73,611 | Uniti Group, Inc. | 1,902,844 | |
| 25,058 | Vornado Realty Trust | 2,513,568 | |
| 2,840 | Whitestone REIT | 39,306 | |
| 7,575,540 | |||
| Health Care REITs—13.8% | |||
| 98,106 | Care Capital Properties, Inc. | 2,636,108 | |
| 78,341 | HCP, Inc. | 2,450,506 | |
| 1,630 | Healthcare Realty Trust, Inc. | 52,975 | |
| 3,260 | Healthcare Trust of America, Inc. | 102,560 | |
| 3,528 | LTC Properties, Inc. | 168,991 | |
| 10,230 | Omega Heathcare Investors, Inc. | 337,488 | |
| 19,176 | * | Quality Care Properties | 361,659 |
| 43,379 | Senior Housing Properties Trust | 878,425 | |
| 50,604 | Ventas, Inc. | 3,291,284 | |
| 51,651 | Welltower, Inc. | 3,657,924 | |
| 13,937,920 |
| 138 |
| Shares | Security | Value | |
| Hotels REITs—2.6% | |||
| 16,612 | Hospitality Properties Trust | $ 523,776 | |
| 81,104 | Host Hotels & Resorts, Inc. | 1,513,401 | |
| 17,324 | LaSalle Hotel Properties | 501,530 | |
| 7,948 | Sunstone Hotel Investors, Inc. | 121,843 | |
| 2,660,550 | |||
| Manufactured Homes REITs—2.4% | |||
| 20,759 | Equity LifeStyle Properties, Inc. | 1,599,689 | |
| 10,371 | Sun Communities, Inc. | 833,102 | |
| 2,432,791 | |||
| Mortgage REITs—.1% | |||
| 5,269 | AGNC Investment Corporation | 104,800 | |
| Office Property REITs—9.1% | |||
| 9,051 | Alexandria Real Estate Equities, Inc. | 1,000,317 | |
| 22,794 | Boston Properties, Inc. | 3,018,154 | |
| 5,700 | Brandywine Realty Trust | 92,511 | |
| 14,800 | City Office REIT, Inc. | 179,820 | |
| 17,825 | Corporate Office Properties Trust | 590,008 | |
| 5,120 | Douglas Emmett, Inc. | 196,608 | |
| 7,040 | Empire State Realty Trust, Inc. – Class “A” | 145,306 | |
| 20,515 | * | Equity Commonwealth | 640,478 |
| 424 | Franklin Street Properties Corporation | 5,147 | |
| 10,665 | Mack-Cali Realty Corporation | 287,315 | |
| 43,470 | New York REIT, Inc. | 421,224 | |
| 60,467 | Paramount Group, Inc. | 980,170 | |
| 12,680 | Piedmont Office Realty Trust, Inc. – Class “A” | 271,098 | |
| 5,912 | SL Green Realty Corporation | 630,337 | |
| 44,965 | Tier REIT, Inc. | 780,592 | |
| 9,239,085 | |||
| Real Estate Services—2.5% | |||
| 101,631 | * | Marcus & Millichap, Inc. | 2,498,090 |
| Regional Malls REITs—21.3% | |||
| 60,894 | CBL & Associates Properties, Inc. | 580,929 | |
| 189,990 | GGP, Inc. | 4,403,968 | |
| 22,612 | Macerich Company | 1,456,213 | |
| 7,720 | Pennsylvania Real Estate Investment Trust | 116,881 | |
| 52,215 | Simon Property Group, Inc. | 8,982,546 | |
| 139 |
Portfolio of Investments (continued)
REAL ESTATE FUND
March 31, 2017
| Shares | Security | Value | |
| Regional Malls REITs (continued) | |||
| 111,853 | Tanger Factory Outlet Centers, Inc. | $ 3,665,423 | |
| 28,635 | Taubman Centers, Inc. | 1,890,483 | |
| 56,320 | Washington Prime Group, Inc. | 489,421 | |
| 21,585,864 | |||
| Shopping Centers REITs—4.8% | |||
| 1,282 | Acadia Realty Trust | 38,537 | |
| 25,400 | Brixmor Property Group, Inc. | 545,084 | |
| 5,800 | Cedar Realty Trust, Inc. | 29,116 | |
| 68,076 | DDR Corporation | 852,992 | |
| 9,913 | Federal Realty Investment Trust | 1,323,386 | |
| 16,971 | Kimco Realty Corporation | 374,889 | |
| 7,090 | Kite Realty Group Trust | 152,435 | |
| 2,580 | Ramco-Gershenson Properties Trust | 36,172 | |
| 5,202 | Regency Centers Corporation | 345,361 | |
| 57,523 | Retail Properties of America, Inc. – Class “A” | 829,482 | |
| 10,995 | Weingarten Realty Investors | 367,123 | |
| 4,894,577 | |||
| Single Tenant REITs—3.2% | |||
| 91,362 | Select Income REIT | 2,356,226 | |
| 45,566 | Spirit Realty Capital, Inc. | 461,584 | |
| 13,922 | STORE Capital Corporation | 332,457 | |
| 8,000 | VEREIT, Inc. | 67,920 | |
| 3,218,187 | |||
| Storage REITs—15.5% | |||
| 42,646 | CubeSmart | 1,107,090 | |
| 47,961 | Extra Space Storage, Inc. | 3,567,819 | |
| 1,459 | Iron Mountain, Inc. | 52,043 | |
| 44,282 | Life Storage, Inc. | 3,636,438 | |
| 33,442 | Public Storage | 7,320,788 | |
| 15,684,178 | |||
| Student Housing REITs—.4% | |||
| 7,292 | American Campus Communities, Inc. | 347,026 | |
| 140 |
| Shares | Security | Value | |||||
| Warehouse/Industrial REITs—1.1% | |||||||
| 1,260 | DCT Industrial Trust, Inc. | $ 60,631 | |||||
| 684 | EastGroup Properties, Inc. | 50,295 | |||||
| 3,320 | First Industrial Realty Trust, Inc. | 88,412 | |||||
| 17,840 | Prologis, Inc. | 925,539 | |||||
| 1,124,877 | |||||||
| Total Value of Common Stocks (cost $97,899,398) | 98.0 | % | 99,183,825 | ||||
| Other Assets, Less Liabilities | 2.0 | 1,990,358 | |||||
| Net Assets | 100.0 | % | $101,174,183 | ||||
| * | Non-income producing |
| Summary of Abbreviations: | |
| REITs Real Estate Investment Trusts |
| 141 |
Portfolio of Investments (continued)
REAL ESTATE FUND
March 31, 2017
The Fund’s assets and liabilities are classified into the following three levels based on the inputs used to value the assets or liabilities:
| Level 1 — Unadjusted quoted prices in active markets for identical securities that the Fund has the ability to access. |
| Level 2 — Observable inputs other than quoted prices included in Level 1 that are observable for the asset or liability, either directly or indirectly. These inputs may include quoted prices for the identical instrument on an inactive market, prices for similar instruments, interest rates, prepayment speeds, credit risk, yield curves, default rates and similar data. |
| Level 3 — Unobservable inputs for the asset or liability, to the extent relevant observable inputs are not available, representing the Fund’s own assumption about the assumptions a market participant would use in valuing the asset or liability, and would be based on the best information available. |
The inputs methodology used for valuing securities are not necessarily an indication of the risk associated with investing in those securities. For example, U.S. Government securities are reflected as Level 2 because the inputs used to determine fair value may not always be quoted prices in an active market.
The following is a summary, by category of Level, of inputs used to value the Fund’s investments as of March 31, 2017:
| Level 1 | Level 2 | Level 3 | Total | |||||||||
| Common Stocks* | $ | 99,183,825 | $ | — | $ | — | $ | 99,183,825 |
| * | The Portfolio of Investments provides information on the industry categorization for common stocks. |
| There were no transfers into or from Level 1 and Level 2 by the Fund for the period ended March 31, | |
| 2017. Transfers, if any, between Levels are recognized at the end of the reporting period. |
| 142 | See notes to financial statements |
Fund Expenses (unaudited)
SELECT GROWTH FUND
The examples below show the ongoing costs (in dollars) of investing in your Fund and will help you in comparing these costs with costs of other mutual funds. Please refer to page 6 for a detailed explanation of the information presented in these examples.
| Annualized | Beginning | Ending | Expenses Paid | |
| Expense | Account Value | Account Value | During Period | |
| Expense Example | Ratio | (10/1/16) | (3/31/17) | (10/1/16–3/31/17)* |
| Class A Shares | 1.26% | |||
| Actual | $1,000.00 | $1,099.32 | $ 6.59 | |
| Hypothetical** | $1,000.00 | $1,018.65 | $ 6.34 | |
| Class B Shares | 2.00% | |||
| Actual | $1,000.00 | $1,094.62 | $10.44 | |
| Hypothetical** | $1,000.00 | $1,014.96 | $10.05 | |
| Advisor Class Shares | 0.84% | |||
| Actual | $1,000.00 | $1,101.38 | $ 4.40 | |
| Hypothetical** | $1,000.00 | $1,020.74 | $ 4.23 | |
| Institutional Class Shares | 0.82% | |||
| Actual | $1,000.00 | $1,102.09 | $ 4.30 | |
| Hypothetical** | $1,000.00 | $1,020.84 | $ 4.13 | |
| * | Expenses are equal to the annualized expense ratio, multiplied by the average account value over |
| the period, multiplied by 182/365 (to reflect the one-half year period). | |
| ** | Assumed rate of return of 5% before expenses. |
Portfolio Composition
BY SECTOR
| Portfolio holdings and allocations are subject to change. Percentages are as of March 31, 2017, and |
| are based on the total market value of investments. |
| 143 |
Portfolio of Investments
SELECT GROWTH FUND
March 31, 2017
| Shares | Security | Value | |
| COMMON STOCKS—99.2% | |||
| Consumer Discretionary—13.7% | |||
| 122,700 | Dick’s Sporting Goods, Inc. | $ 5,970,582 | |
| 612,100 | Gentex Corporation | 13,056,093 | |
| 113,000 | Home Depot, Inc. | 16,591,790 | |
| 77,800 | Lear Corporation | 11,014,924 | |
| 211,900 | Nordstrom, Inc. | 9,868,183 | |
| 122,500 | Wyndham Worldwide Corporation | 10,325,525 | |
| 66,827,097 | |||
| Consumer Staples—8.2% | |||
| 115,500 | Clorox Company | 15,572,865 | |
| 264,000 | Sysco Corporation | 13,706,880 | |
| 147,600 | Wal-Mart Stores, Inc. | 10,639,008 | |
| 39,918,753 | |||
| Energy—3.8% | |||
| 44,200 | Chevron Corporation | 4,745,754 | |
| 47,800 | ExxonMobil Corporation | 3,920,078 | |
| 72,700 | Helmerich & Payne, Inc. | 4,839,639 | |
| 196,800 | SM Energy Company | 4,727,136 | |
| 18,232,607 | |||
| Financials—11.4% | |||
| 243,900 | Bank of New York Mellon Corporation | 11,519,397 | |
| 128,800 | Discover Financial Services | 8,808,632 | |
| 187,800 | SunTrust Banks, Inc. | 10,385,340 | |
| 55,400 | Travelers Companies, Inc. | 6,677,916 | |
| 215,800 | U.S. Bancorp | 11,113,700 | |
| 187,900 | Voya Financial, Inc. | 7,132,684 | |
| 55,637,669 | |||
| Health Care—16.1% | |||
| 229,300 | Baxter International, Inc. | 11,891,498 | |
| 64,400 | C.R. Bard, Inc. | 16,005,976 | |
| 99,300 | * | Celgene Corporation | 12,355,899 |
| 186,400 | * | Centene Corporation | 13,282,864 |
| 330,300 | * | Hologic, Inc. | 14,054,265 |
| 173,300 | Merck & Company, Inc. | 11,011,482 | |
| 78,601,984 | |||
| 144 |
| Shares or | |||||||
| Principal | |||||||
| Amount | Security | Value | |||||
| Industrials—14.0% | |||||||
| 125,600 | Cintas Corporation | $ 15,893,424 | |||||
| 191,600 | Emerson Electric Company | 11,469,176 | |||||
| 78,500 | General Dynamics Corporation | 14,695,200 | |||||
| 55,000 | Huntington Ingalls Industries, Inc. | 11,013,200 | |||||
| 93,200 | Parker Hannifin Corporation | 14,941,824 | |||||
| 68,012,824 | |||||||
| Information Technology—29.5% | |||||||
| 148,000 | * | Adobe Systems, Inc. | 19,259,240 | ||||
| 13,600 | * | Alphabet, Inc. – Class “A” | 11,530,080 | ||||
| 164,300 | * | Arista Networks, Inc. | 21,731,961 | ||||
| 568,600 | * | Cadence Design Systems, Inc. | 17,854,040 | ||||
| 152,300 | * | Citrix Systems, Inc. | 12,700,297 | ||||
| 120,000 | * | Facebook, Inc. – Class “A” | 17,046,000 | ||||
| 65,200 | * | FleetCor Technologies, Inc. | 9,873,236 | ||||
| 312,800 | NetApp, Inc. | 13,090,680 | |||||
| 349,000 | * | Take-Two Interactive Software | 20,685,230 | ||||
| 143,770,764 | |||||||
| Materials—2.5% | |||||||
| 131,300 | Celanese Corporation – Series “A” | 11,797,305 | |||||
| Total Value of Common Stocks (cost $391,334,349) | 482,799,003 | ||||||
| SHORT-TERM U.S. GOVERNMENT AGENCY | |||||||
| OBLIGATIONS—.6% | |||||||
| Federal Home Loan Bank: | |||||||
| $1,500M | 0.57%, 4/5/2017 | 1,499,943 | |||||
| 500M | 0.74%, 4/26/2017 | 499,783 | |||||
| 1,000M | 0.75%, 4/21/2017 | 999,660 | |||||
| Total Value of Short-Term U.S. Government | |||||||
| Agency Obligations (cost $2,999,231) | 2,999,386 | ||||||
| Total Value of Investments (cost $394,333,580) | 99.8 | % | 485,798,389 | ||||
| Other Assets, Less Liabilities | .2 | 1,152,507 | |||||
| Net Assets | 100.0 | % | $486,950,896 | ||||
| * | Non-income producing |
| 145 |
Portfolio of Investments (continued)
SELECT GROWTH FUND
March 31, 2017
The Fund’s assets and liabilities are classified into the following three levels based on the inputs used to value the assets or liabilities:
| Level 1 — Unadjusted quoted prices in active markets for identical securities that the Fund has the ability to access. |
| Level 2 — Observable inputs other than quoted prices included in Level 1 that are observable for the asset or liability, either directly or indirectly. These inputs may include quoted prices for the identical instrument on an inactive market, prices for similar instruments, interest rates, prepayment speeds, credit risk, yield curves, default rates and similar data. |
| Level 3 — Unobservable inputs for the asset or liability, to the extent relevant observable inputs are not available, representing the Fund’s own assumption about the assumptions a market participant would use in valuing the asset or liability, and would be based on the best information available. |
The inputs methodology used for valuing securities are not necessarily an indication of the risk associated with investing in those securities. For example, U.S. Government securities are reflected as Level 2 because the inputs used to determine fair value may not always be quoted prices in an active market.
The following is a summary, by category of Level, of inputs used to value the Fund’s investments as of March 31, 2017:
| Level 1 | Level 2 | Level 3 | Total | |||||||||
| Common Stocks | $ | 482,799,003 | $ | — | $ | — | $ | 482,799,003 | ||||
| Short-Term U.S. Government | ||||||||||||
| Agency Obligations | — | 2,999,386 | — | 2,999,386 | ||||||||
| Total Investments in Securities* | $ | 482,799,003 | $ | 2,999,386 | $ | — | $ | 485,798,389 |
| * | The Portfolio of Investments provides information on the industry categorization for common stocks. |
| There were no transfers into or from Level 1 and Level 2 by the Fund for the period ended March 31, | |
| 2017. Transfers, if any, between Levels are recognized at the end of the reporting period. |
| 146 | See notes to financial statements |
Fund Expenses (unaudited)
SPECIAL SITUATIONS FUND
The examples below show the ongoing costs (in dollars) of investing in your Fund and will help you in comparing these costs with costs of other mutual funds. Please refer to page 6 for a detailed explanation of the information presented in these examples.
| Annualized | Beginning | Ending | Expenses Paid | |
| Expense | Account Value | Account Value | During Period | |
| Expense Example | Ratio | (10/1/16) | (3/31/17) | (10/1/16–3/31/17)* |
| Class A Shares | 1.32% | |||
| Actual | $1,000.00 | $1,106.22 | $ 6.93 | |
| Hypothetical** | $1,000.00 | $1,018.35 | $ 6.64 | |
| Class B Shares | 2.11% | |||
| Actual | $1,000.00 | $1,101.93 | $11.06 | |
| Hypothetical** | $1,000.00 | $1,014.41 | $10.60 | |
| Advisor Class Shares | 1.02% | |||
| Actual | $1,000.00 | $1,107.68 | $ 5.36 | |
| Hypothetical** | $1,000.00 | $1,019.84 | $ 5.14 | |
| Institutional Class Shares | 0.88% | |||
| Actual | $1,000.00 | $1,108.54 | $ 4.63 | |
| Hypothetical** | $1,000.00 | $1,020.54 | $ 4.43 | |
| * | Expenses are equal to the annualized expense ratio, multiplied by the average account value over |
| the period, multiplied by 182/365 (to reflect the one-half year period). Expenses paid during the | |
| period are net of expenses waived. | |
| ** | Assumed rate of return of 5% before expenses. |
Portfolio Composition
BY SECTOR
| Portfolio holdings and allocations are subject to change. Percentages are as of March 31, 2017, and |
| are based on the total market value of investments. |
| 147 |
Portfolio of Investments
SPECIAL SITUATIONS FUND
March 31, 2017
| Shares | Security | Value | |
| COMMON STOCKS—97.3% | |||
| Consumer Discretionary—17.4% | |||
| 277,500 | * | 1-800-FLOWERS.COM, Inc. – Class “A” | $ 2,830,500 |
| 140,000 | Acushnet Holdings Corporation | 2,419,200 | |
| 176,500 | American Eagle Outfitters, Inc. | 2,476,295 | |
| 197,000 | * | Belmond, Ltd. – Class “A” | 2,383,700 |
| 85,500 | Caleres, Inc. | 2,258,910 | |
| 294,500 | * | Century Communities, Inc. | 7,480,300 |
| 157,000 | DSW, Inc. – Class “A” | 3,246,760 | |
| 280,000 | Entravision Communications Corporation – Class “A” | 1,736,000 | |
| 358,500 | * | Fox Factory Holding Corporation | 10,288,950 |
| 32,500 | * | Helen of Troy, Ltd. | 3,061,500 |
| 191,000 | * | Live Nation Entertainment, Inc. | 5,800,670 |
| 83,000 | * | LKQ Corporation | 2,429,410 |
| 17,400 | * | Malibu Boats, Inc. | 390,630 |
| 105,000 | * | Michaels Companies, Inc. | 2,350,950 |
| 100,000 | * | Motorcar Parts of America, Inc. | 3,073,000 |
| 165,000 | Newell Brands, Inc. | 7,783,050 | |
| 78,000 | Oxford Industries, Inc. | 4,466,280 | |
| 76,500 | Penske Automotive Group, Inc. | 3,580,965 | |
| 213,000 | Regal Entertainment Group – Class “A” | 4,809,540 | |
| 253,000 | Ruth’s Hospitality Group, Inc. | 5,072,650 | |
| 196,000 | * | ServiceMaster Global Holdings, Inc. | 8,183,000 |
| 340,000 | * | TRI Pointe Group, Inc. | 4,263,600 |
| 63,500 | Tupperware Brands Corporation | 3,982,720 | |
| 49,500 | * | Visteon Corporation | 4,848,525 |
| 192,000 | * | William Lyon Homes – Class “A” | 3,959,040 |
| 103,176,145 | |||
| Consumer Staples—4.2% | |||
| 82,000 | AdvancePierre Foods Holdings, Inc. | 2,555,940 | |
| 92,000 | B&G Foods, Inc. | 3,703,000 | |
| 135,500 | * | Performance Food Group Company | 3,224,900 |
| 123,500 | Pinnacle Foods, Inc. | 7,146,945 | |
| 94,000 | Tootsie Roll Industries, Inc. | 3,510,900 | |
| 163,500 | * | U.S. Foods Holding Corporation | 4,574,730 |
| 24,716,415 | |||
| 148 |
| Shares | Security | Value | |
| Energy—1.9% | |||
| 43,000 | Delek US Holdings, Inc. | $ 1,043,610 | |
| 51,000 | * | Dril-Quip, Inc. | 2,782,050 |
| 144,200 | * | Jagged Peak Energy, Inc. | 1,880,368 |
| 93,500 | PBF Energy, Inc. – Class “A” | 2,072,895 | |
| 102,500 | Western Refining, Inc. | 3,594,675 | |
| 11,373,598 | |||
| Financials—20.3% | |||
| 146,500 | AllianceBernstein Holding, LP (MLP) | 3,347,525 | |
| 149,500 | American Financial Group, Inc. | 14,265,290 | |
| 100,000 | Aspen Insurance Holdings, Ltd. | 5,205,000 | |
| 177,500 | * | Atlas Financial Holdings, Inc. | 2,422,875 |
| 211,500 | Berkshire Hills Bancorp, Inc. | 7,624,575 | |
| 145,500 | Brown & Brown, Inc. | 6,070,260 | |
| 72,500 | * | Capstar Financial Holdings, Inc. | 1,382,575 |
| 153,000 | Citizens Financial Group, Inc. | 5,286,150 | |
| 14,500 | * | FB Financial Corporation | 512,720 |
| 100,000 | * | FCB Financial Holdings, Inc. – Class “A” | 4,955,000 |
| 306,500 | Financial Select Sector SPDR Fund (ETF) | 7,273,245 | |
| 114,000 | Great Western Bancorp, Inc. | 4,834,740 | |
| 180,500 | * | Green Bancorp, Inc. | 3,212,900 |
| 87,000 | Guaranty Bancorp | 2,118,450 | |
| 37,500 | IBERIABANK Corporation | 2,966,250 | |
| 22,000 | iShares Russell 2000 ETF (ETF) | 3,024,560 | |
| 196,000 | OceanFirst Financial Corporation | 5,522,300 | |
| 92,000 | Prosperity Bancshares, Inc. | 6,413,320 | |
| 31,100 | QCR Holdings, Inc. | 1,317,085 | |
| 113,500 | * | Seacoast Banking Corporation | 2,721,730 |
| 84,500 | Simmons First National Corporation – Class “A” | 4,660,175 | |
| 141,000 | SPDR S&P Regional Banking (ETF) | 7,700,010 | |
| 465,000 | Sterling Bancorp | 11,020,500 | |
| 351,500 | TCF Financial Corporation | 5,982,530 | |
| 50,500 | Waddell & Reed Financial, Inc. – Class “A” | 858,500 | |
| 120,698,265 | |||
| Health Care—10.3% | |||
| 63,500 | * | ANI Pharmaceuticals, Inc. | 3,143,885 |
| 59,500 | * | Cambrex Corporation | 3,275,475 |
| 153,000 | * | Centene Corporation | 10,902,780 |
| 40,000 | * | Charles River Laboratories International, Inc. | 3,598,000 |
| 152,000 | * | DepoMed, Inc. | 1,907,600 |
| 149 |
Portfolio of Investments (continued)
SPECIAL SITUATIONS FUND
March 31, 2017
| Shares | Security | Value | |
| Health Care (continued) | |||
| 106,500 | Hill-Rom Holdings, Inc. | $ 7,518,900 | |
| 34,000 | * | ICON, PLC | 2,710,480 |
| 156,000 | * | Integra LifeSciences Holdings Corporation | 6,572,280 |
| 26,000 | * | LivaNova, PLC | 1,274,260 |
| 117,000 | PerkinElmer, Inc. | 6,793,020 | |
| 180,500 | Phibro Animal Health Corporation – Class “A” | 5,072,050 | |
| 43,000 | * | VCA, Inc. | 3,934,500 |
| 165,000 | * | VWR Corporation | 4,653,000 |
| 61,356,230 | |||
| Industrials—13.0% | |||
| 181,500 | A.O. Smith Corporation | 9,285,540 | |
| 52,000 | Apogee Enterprises, Inc. | 3,099,720 | |
| 140,000 | * | Atkore International Group, Inc. | 3,679,200 |
| 29,500 | Comfort Systems USA, Inc. | 1,081,175 | |
| 135,000 | ESCO Technologies, Inc. | 7,843,500 | |
| 70,500 | ITT, Inc. | 2,891,910 | |
| 138,500 | Kforce, Inc. | 3,289,375 | |
| 355,500 | * | NCI Building Systems, Inc. | 6,096,825 |
| 114,500 | Orbital ATK, Inc. | 11,221,000 | |
| 58,000 | * | Patrick Industries, Inc. | 4,112,200 |
| 38,500 | Regal Beloit Corporation | 2,912,525 | |
| 63,500 | Snap-On, Inc. | 10,710,545 | |
| 75,500 | * | SPX Corporation | 1,830,875 |
| 44,000 | Standex International Corporation | 4,406,600 | |
| 169,000 | Triton International, Ltd. | 4,358,510 | |
| 76,819,500 | |||
| Information Technology—12.2% | |||
| 228,500 | * | ARRIS International, PLC | 6,043,825 |
| 159,700 | * | Autobytel, Inc. | 2,001,041 |
| 161,000 | * | CommScope Holding Company, Inc. | 6,715,310 |
| 62,000 | Hackett Group, Inc. | 1,208,380 | |
| 49,500 | * | IAC/InterActiveCorp | 3,649,140 |
| 41,000 | Lam Research Corporation | 5,262,760 | |
| 104,000 | * | Microsemi Corporation | 5,359,120 |
| 87,000 | MKS Instruments, Inc. | 5,981,250 | |
| 281,500 | * | Orbotech, Ltd. | 9,078,375 |
| 154,500 | * | Perficient, Inc. | 2,682,120 |
| 144,000 | Silicon Motion Technology Corporation (ADR) | 6,732,000 | |
| 116,000 | * | Synchronoss Technologies, Inc. | 2,830,400 |
| 150 |
| Shares | Security | Value | |
| Information Technology (continued) | |||
| 286,500 | Travelport Worldwide, Ltd. | $ 3,372,105 | |
| 74,000 | Western Digital Corporation | 6,107,220 | |
| 58,500 | * | Zebra Technologies Corporation – Class “A” | 5,338,125 |
| 72,361,171 | |||
| Materials—8.7% | |||
| 111,500 | AptarGroup, Inc. | 8,584,385 | |
| 93,500 | * | Berry Plastics Group, Inc. | 4,541,295 |
| 396,000 | * | Ferro Corporation | 6,015,240 |
| 174,000 | * | Louisiana-Pacific Corporation | 4,318,680 |
| 63,500 | Sealed Air Corporation | 2,767,330 | |
| 57,000 | Sensient Technologies Corporation | 4,517,820 | |
| 248,000 | * | Summit Materials, Inc. – Class “A” | 6,128,080 |
| 159,500 | Trinseo SA | 10,702,450 | |
| 75,500 | WestRock Company | 3,928,265 | |
| 51,503,545 | |||
| Real Estate—6.3% | |||
| 244,000 | Brixmor Property Group, Inc. (REIT) | 5,236,240 | |
| 183,000 | Douglas Emmett, Inc. (REIT) | 7,027,200 | |
| 52,000 | Federal Realty Investment Trust (REIT) | 6,942,000 | |
| 434,500 | FelCor Lodging Trust, Inc. (REIT) | 3,263,095 | |
| 362,000 | Sunstone Hotel Investors, Inc. (REIT) | 5,549,460 | |
| 191,000 | Tanger Factory Outlet Centers, Inc. (REIT) | 6,259,070 | |
| 135,000 | Urstadt Biddle Properties, Inc. – Class “A” (REIT) | 2,775,600 | |
| 37,052,665 | |||
| Utilities—3.0% | |||
| 45,500 | Pinnacle West Capital Corporation | 3,793,790 | |
| 110,500 | Portland General Electric Company | 4,908,410 | |
| 70,000 | SCANA Corporation | 4,574,500 | |
| 79,000 | WEC Energy Group, Inc. | 4,789,770 | |
| 18,066,470 | |||
| Total Value of Common Stocks (cost $439,806,466) | 577,124,004 | ||
| 151 |
Portfolio of Investments (continued)
SPECIAL SITUATIONS FUND
March 31, 2017
| Principal | |||||||
| Amount | Security | Value | |||||
| SHORT-TERM U.S. GOVERNMENT AGENCY | |||||||
| OBLIGATIONS—1.6% | |||||||
| Federal Home Loan Bank: | |||||||
| $2,500M | 0.7%, 4/24/2017 | $ 2,499,007 | |||||
| 5,000M | 0.74%, 4/26/2017 | 4,997,830 | |||||
| 2,000M | 0.75%, 4/17/2017 | 1,999,472 | |||||
| Total Value of Short-Term U.S. Government | |||||||
| Agency Obligations (cost $9,495,645) | 9,496,309 | ||||||
| SHORT-TERM U.S. GOVERNMENT | |||||||
| OBLIGATIONS—.2% | |||||||
| 1,500M | U.S. Treasury Bills, 0.721%, 4/27/2017 (cost $1,499,219) | 1,499,276 | |||||
| Total Value of Investments (cost $450,801,330) | 99.1 | % | 588,119,589 | ||||
| Other Assets, Less Liabilities | .9 | 5,073,820 | |||||
| Net Assets | 100.0 | % | $593,193,409 | ||||
| * | Non-income producing | |
| Summary of Abbreviations: | ||
| ADR | American Depositary Receipts | |
| ETF | Exchange Traded Fund | |
| MLP | Master Limited Partnership | |
| REIT | Real Estate Investment Trust | |
| 152 |
The Fund’s assets and liabilities are classified into the following three levels based on the inputs used to value the assets or liabilities:
| Level 1 — Unadjusted quoted prices in active markets for identical securities that the Fund has the ability to access. |
| Level 2 — Observable inputs other than quoted prices included in Level 1 that are observable for the asset or liability, either directly or indirectly. These inputs may include quoted prices for the identical instrument on an inactive market, prices for similar instruments, interest rates, prepayment speeds, credit risk, yield curves, default rates and similar data. |
| Level 3 — Unobservable inputs for the asset or liability, to the extent relevant observable inputs are not available, representing the Fund’s own assumption about the assumptions a market participant would use in valuing the asset or liability, and would be based on the best information available. |
The inputs methodology used for valuing securities are not necessarily an indication of the risk associated with investing in those securities. For example, U.S. Government securities are reflected as Level 2 because the inputs used to determine fair value may not always be quoted prices in an active market.
The following is a summary, by category of Level, of inputs used to value the Fund’s investments as of March 31, 2017:
| Level 1 | Level 2 | Level 3 | Total | |||||||||
| Common Stocks | $ | 577,124,004 | $ | — | $ | — | $ | 577,124,004 | ||||
| Short-Term U.S. Government | ||||||||||||
| Agency Obligations | — | 9,496,309 | — | 9,496,309 | ||||||||
| Short-Term U.S. Government | ||||||||||||
| Obligations | — | 1,499,276 | — | 1,499,276 | ||||||||
| Total Investments in Securities* | $ | 577,124,004 | $ | 10,995,585 | $ | — | $ | 588,119,589 |
| * | The Portfolio of Investments provides information on the industry categorization for common stocks. |
| There were no transfers into or from Level 1 and Level 2 by the Fund for the period ended March 31, | |
| 2017. Transfers, if any, between Levels are recognized at the end of the reporting period. |
| See notes to financial statements | 153 |
Fund Expenses (unaudited)
TOTAL RETURN FUND
The examples below show the ongoing costs (in dollars) of investing in your Fund and will help you in comparing these costs with costs of other mutual funds. Please refer to page 6 for a detailed explanation of the information presented in these examples.
| Annualized | Beginning | Ending | Expenses Paid | |
| Expense | Account Value | Account Value | During Period | |
| Expense Example | Ratio | (10/1/16) | (3/31/17) | (10/1/16–3/31/17)* |
| Class A Shares | 1.19% | |||
| Actual | $1,000.00 | $1,036.48 | $6.04 | |
| Hypothetical** | $1,000.00 | $1,019.00 | $5.99 | |
| Class B Shares | 1.94% | |||
| Actual | $1,000.00 | $1,032.15 | $9.83 | |
| Hypothetical** | $1,000.00 | $1,015.26 | $9.75 | |
| Advisor Class Shares | 0.79% | |||
| Actual | $1,000.00 | $1,040.60 | $4.02 | |
| Hypothetical** | $1,000.00 | $1,020.99 | $3.98 | |
| Institutional Class Shares | 0.77% | |||
| Actual | $1,000.00 | $1,038.33 | $3.91 | |
| Hypothetical** | $1,000.00 | $1,021.09 | $3.88 | |
| * | Expenses are equal to the annualized expense ratio, multiplied by the average account value over |
| the period, multiplied by 182/365 (to reflect the one-half year period). | |
| ** | Assumed rate of return of 5% before expenses. |
Portfolio Composition
TOP TEN SECTORS
| Portfolio holdings and allocations are subject to change. Percentages are as of March 31, 2017, and |
| are based on the total market value of investments. |
| 154 |
Portfolio of Investments
TOTAL RETURN FUND
March 31, 2017
| Shares | Security | Value | |
| COMMON STOCKS—59.3% | |||
| Consumer Discretionary—10.9% | |||
| 110,400 | Acushnet Holdings Corporation | $ 1,907,712 | |
| 12,197 | Adient, PLC | 886,356 | |
| 107,900 | American Eagle Outfitters, Inc. | 1,513,837 | |
| 53,700 | ARAMARK Holdings Corporation | 1,979,919 | |
| 73,500 | Big Lots, Inc. | 3,577,980 | |
| 84,130 | BorgWarner, Inc. | 3,515,793 | |
| 127,375 | CBS Corporation – Class “B” | 8,834,730 | |
| 38,500 | Coach, Inc. | 1,591,205 | |
| 38,800 | Delphi Automotive, PLC | 3,123,012 | |
| 132,700 | DSW, Inc. – Class “A” | 2,744,236 | |
| 27,760 | Foot Locker, Inc. | 2,076,726 | |
| 201,950 | Ford Motor Company | 2,350,698 | |
| 53,830 | Home Depot, Inc. | 7,903,859 | |
| 26,600 | HSN, Inc. | 986,860 | |
| 153,073 | Johnson Controls International, PLC | 6,447,435 | |
| 77,045 | L Brands, Inc. | 3,628,819 | |
| 19,400 | Lear Corporation | 2,746,652 | |
| 69,700 | Magna International, Inc. | 3,008,252 | |
| 90,900 | Michaels Companies, Inc. | 2,035,251 | |
| 284,522 | Newell Brands, Inc. | 13,420,903 | |
| 56,000 | Oxford Industries, Inc. | 3,206,560 | |
| 38,600 | Penske Automotive Group, Inc. | 1,806,866 | |
| 84,300 | * | Select Comfort Corporation | 2,089,797 |
| 91,910 | Tupperware Brands Corporation | 5,764,595 | |
| 48,800 | Walt Disney Company | 5,533,432 | |
| 19,675 | Whirlpool Corporation | 3,370,918 | |
| 31,290 | Wyndham Worldwide Corporation | 2,637,434 | |
| 98,689,837 | |||
| Consumer Staples—6.1% | |||
| 48,700 | AdvancePierre Foods Holdings, Inc. | 1,517,979 | |
| 146,350 | Altria Group, Inc. | 10,452,317 | |
| 80,400 | B&G Foods, Inc. | 3,236,100 | |
| 105,890 | Coca-Cola Company | 4,493,972 | |
| 87,960 | CVS Health Corporation | 6,904,860 | |
| 168,530 | Koninklijke Ahold Delhaize NV (ADR) | 3,613,283 | |
| 49,600 | Nu Skin Enterprises, Inc. – Class “A” | 2,754,784 | |
| 49,360 | PepsiCo, Inc. | 5,521,410 | |
| 155 |
Portfolio of Investments (continued)
TOTAL RETURN FUND
March 31, 2017
| Shares | Security | Value | |
| Consumer Staples (continued) | |||
| 90,310 | Philip Morris International, Inc. | $ 10,195,999 | |
| 31,400 | Procter & Gamble Company | 2,821,290 | |
| 46,870 | Wal-Mart Stores, Inc. | 3,378,390 | |
| 54,890,384 | |||
| Energy—3.4% | |||
| 37,375 | Anadarko Petroleum Corporation | 2,317,250 | |
| 9,400 | Chevron Corporation | 1,009,278 | |
| 61,800 | ConocoPhillips | 3,081,966 | |
| 51,575 | Devon Energy Corporation | 2,151,709 | |
| 59,902 | ExxonMobil Corporation | 4,912,563 | |
| 26,500 | Hess Corporation | 1,277,565 | |
| 80,101 | Marathon Oil Corporation | 1,265,596 | |
| 106,850 | Marathon Petroleum Corporation | 5,400,199 | |
| 26,150 | Occidental Petroleum Corporation | 1,656,864 | |
| 31,000 | PBF Energy, Inc. – Class “A” | 687,270 | |
| 34,450 | Phillips 66 | 2,729,129 | |
| 14,700 | Schlumberger, Ltd. | 1,148,070 | |
| 105,660 | Suncor Energy, Inc. | 3,249,045 | |
| 30,886,504 | |||
| Financials—8.7% | |||
| 69,170 | American Express Company | 5,472,039 | |
| 50,800 | American International Group, Inc. | 3,171,444 | |
| 48,125 | Ameriprise Financial, Inc. | 6,240,850 | |
| 39,100 | Chubb, Ltd. | 5,327,375 | |
| 157,300 | Citizens Financial Group, Inc. | 5,434,715 | |
| 97,610 | Discover Financial Services | 6,675,548 | |
| 167,600 | Financial Select Sector SPDR Fund (ETF) | 3,977,148 | |
| 2,500 | * | Hamilton Lane, Inc. – Class “A” | 46,675 |
| 40,000 | IBERIABANK Corporation | 3,164,000 | |
| 16,800 | iShares Russell 2000 ETF (ETF) | 2,309,664 | |
| 119,380 | JPMorgan Chase & Company | 10,486,339 | |
| 70,400 | MetLife, Inc. | 3,718,528 | |
| 15,730 | Morgan Stanley | 673,873 | |
| 44,625 | PNC Financial Services Group, Inc. | 5,365,710 | |
| 75,900 | SPDR S&P Regional Banking (ETF) | 4,144,899 | |
| 156 |
| Shares | Security | Value | |
| Financials (continued) | |||
| 59,600 | Sterling Bancorp | $ 1,412,520 | |
| 107,345 | U.S. Bancorp | 5,528,267 | |
| 86,120 | Wells Fargo & Company | 4,793,439 | |
| 77,943,033 | |||
| Health Care—9.1% | |||
| 127,360 | Abbott Laboratories | 5,656,058 | |
| 99,500 | AbbVie, Inc. | 6,483,420 | |
| 6,376 | Allergan, PLC | 1,523,354 | |
| 72,500 | * | AMN Healthcare Services, Inc. | 2,943,500 |
| 49,569 | Baxter International, Inc. | 2,570,648 | |
| 30,700 | * | Centene Corporation | 2,187,682 |
| 96,680 | Gilead Sciences, Inc. | 6,566,506 | |
| 27,300 | Hill-Rom Holdings, Inc. | 1,927,379 | |
| 81,400 | Johnson & Johnson | 10,138,370 | |
| 2,791 | * | Mallinckrodt, PLC | 124,395 |
| 39,000 | Medtronic, PLC | 3,141,840 | |
| 99,745 | Merck & Company, Inc. | 6,337,797 | |
| 37,225 | * | Mylan NV (ADR) | 1,451,403 |
| 266,729 | Pfizer, Inc. | 9,124,799 | |
| 93,475 | Phibro Animal Health Corporation – Class “A” | 2,626,647 | |
| 19,515 | Shire, PLC (ADR) | 3,400,098 | |
| 60,295 | Thermo Fisher Scientific, Inc. | 9,261,312 | |
| 68,600 | * | VWR Corporation | 1,934,520 |
| 78,215 | Zoetis, Inc. | 4,174,335 | |
| 81,574,063 | |||
| Industrials—5.0% | |||
| 41,585 | 3M Company | 7,956,458 | |
| 108,350 | General Electric Company | 3,228,830 | |
| 63,000 | Honeywell International, Inc. | 7,866,810 | |
| 16,000 | Ingersoll-Rand, PLC | 1,301,120 | |
| 59,000 | Koninklijke Philips NV (ADR) | 1,894,490 | |
| 6,020 | Lockheed Martin Corporation | 1,610,952 | |
| 30,200 | ManpowerGroup, Inc. | 3,097,614 | |
| 39,930 | Snap-On, Inc. | 6,734,993 | |
| 13,400 | Stanley Black & Decker, Inc. | 1,780,458 | |
| 33,930 | Textainer Group Holdings, Ltd. | 519,129 | |
| 138,400 | Triton International, Ltd. | 3,569,336 | |
| 46,030 | United Technologies Corporation | 5,165,026 | |
| 44,725,216 | |||
| 157 |
Portfolio of Investments (continued)
TOTAL RETURN FUND
March 31, 2017
| Shares | Security | Value | |
| Information Technology—10.9% | |||
| 93,905 | Apple, Inc. | $ 13,490,392 | |
| 102,800 | Applied Materials, Inc. | 3,998,920 | |
| 149,875 | * | ARRIS International, PLC | 3,964,194 |
| 23,625 | Broadcom, Ltd. | 5,172,930 | |
| 270,300 | Cisco Systems, Inc. | 9,136,140 | |
| 32,568 | * | Dell Technologies, Inc. – Class “V” | 2,086,957 |
| 76,200 | * | eBay, Inc. | 2,558,034 |
| 126,605 | HP Enterprise Company | 3,000,539 | |
| 175,675 | Intel Corporation | 6,336,597 | |
| 22,800 | International Business Machines Corporation | 3,970,392 | |
| 24,080 | Methode Electronics, Inc. | 1,098,048 | |
| 190,085 | Microsoft Corporation | 12,518,998 | |
| 37,340 | * | NXP Semiconductors NV | 3,864,690 |
| 106,790 | Oracle Corporation | 4,763,902 | |
| 96,620 | QUALCOMM, Inc. | 5,540,191 | |
| 83,100 | Sabre Corporation | 1,760,889 | |
| 183,950 | Symantec Corporation | 5,643,586 | |
| 23,610 | TE Connectivity, Ltd. | 1,760,126 | |
| 21,700 | * | Tech Data Corporation | 2,037,630 |
| 83,300 | Travelport Worldwide, Ltd. | 980,441 | |
| 54,772 | Western Digital Corporation | 4,520,333 | |
| 98,203,929 | |||
| Materials—1.8% | |||
| 62,900 | International Paper Company | 3,194,062 | |
| 126,800 | * | Louisiana-Pacific Corporation | 3,147,176 |
| 17,930 | Praxair, Inc. | 2,126,498 | |
| 41,310 | RPM International, Inc. | 2,273,289 | |
| 85,600 | Sealed Air Corporation | 3,730,448 | |
| 25,585 | Trinseo SA | 1,716,753 | |
| 16,188,226 | |||
| Real Estate—1.4% | |||
| 214,625 | Brixmor Property Group, Inc. (REIT) | 4,605,853 | |
| 23,320 | Real Estate Select Sector SPDR Fund (ETF) | 736,912 | |
| 135,813 | Sunstone Hotel Investors, Inc. (REIT) | 2,082,013 | |
| 91,000 | Tanger Factory Outlet Centers, Inc. (REIT) | 2,982,070 | |
| 112,430 | Urstadt Biddle Properties, Inc. – Class “A” (REIT) | 2,311,561 | |
| 12,718,409 | |||
| 158 |
| Shares or | |||
| Principal | |||
| Amount | Security | Value | |
| Telecommunication Services—1.4% | |||
| 158,400 | AT&T, Inc. | $ 6,581,520 | |
| 130,725 | Verizon Communications, Inc. | 6,372,844 | |
| 12,954,364 | |||
| Utilities—.6% | |||
| 133,400 | Exelon Corporation | 4,799,732 | |
| 24,445 | NiSource, Inc. | 581,547 | |
| 5,381,279 | |||
| Total Value of Common Stocks (cost $347,788,641) | 534,155,244 | ||
| CORPORATE BONDS—20.9% | |||
| Aerospace/Defense—.2% | |||
| $ 1,500M | Rolls-Royce, PLC, 3.625%, 10/14/2025 (a) | 1,511,511 | |
| Agricultural Products—.1% | |||
| 1,100M | Cargill, Inc., 6%, 11/27/2017 (a) | 1,132,155 | |
| Automotive—.2% | |||
| 2,000M | O’Reilly Automotive, Inc., 3.55%, 3/15/2026 | 1,996,786 | |
| Chemicals—.7% | |||
| 2,000M | Agrium, Inc., 3.375%, 3/15/2025 | 1,977,220 | |
| 2,000M | Dow Chemical Co., 3.5%, 10/1/2024 | 2,036,064 | |
| 2,100M | LyondellBasell Industries NV, 6%, 11/15/2021 | 2,379,785 | |
| 6,393,069 | |||
| Consumer Non-Durables—.2% | |||
| 2,000M | Newell Brands, Inc., 4.2%, 4/1/2026 | 2,083,768 | |
| Energy—1.8% | |||
| 3,600M | BP Capital Markets, PLC, 3.216%, 11/28/2023 | 3,621,607 | |
| 1,600M | Canadian Oil Sands, Ltd., 7.75%, 5/15/2019 (a) | 1,758,706 | |
| 1,000M | DCP Midstream Operating, LP, 2.5%, 12/1/2017 | 1,000,000 | |
| 1,500M | Enbridge Energy Partners, LP, 4.2%, 9/15/2021 | 1,557,519 | |
| Kinder Morgan Energy Partners, LP: | |||
| 1,000M | 3.5%, 3/1/2021 | 1,017,148 | |
| 1,100M | 3.45%, 2/15/2023 | 1,087,062 | |
| 1,000M | Magellan Midstream Partners, LP, 5%, 3/1/2026 | 1,102,758 | |
| 1,000M | ONEOK Partners, LP, 3.375%, 10/1/2022 | 1,002,114 | |
| 159 |
Portfolio of Investments (continued)
TOTAL RETURN FUND
March 31, 2017
| Principal | |||
| Amount | Security | Value | |
| Energy (continued) | |||
| $ 1,500M | Spectra Energy, LLC, 6.2%, 4/15/2018 | $ 1,564,892 | |
| 1,000M | Suncor Energy, Inc., 6.1%, 6/1/2018 | 1,052,845 | |
| 1,600M | Valero Energy Corp., 9.375%, 3/15/2019 | 1,820,043 | |
| 16,584,694 | |||
| Financial Services—2.7% | |||
| 1,100M | American Express Co., 7%, 3/19/2018 | 1,155,359 | |
| American International Group, Inc.: | |||
| 1,000M | 3.75%, 7/10/2025 | 996,176 | |
| 1,000M | 4.7%, 7/10/2035 | 1,015,092 | |
| 1,000M | Ameriprise Financial, Inc., 5.3%, 3/15/2020 | 1,086,863 | |
| 1,000M | Assured Guaranty U.S. Holding, Inc., 5%, 7/1/2024 | 1,077,760 | |
| 1,100M | BlackRock, Inc., 5%, 12/10/2019 | 1,193,342 | |
| ERAC USA Finance, LLC: | |||
| 1,000M | 6.375%, 10/15/2017 (a) | 1,023,834 | |
| 1,000M | 4.5%, 8/16/2021 (a) | 1,066,080 | |
| 1,000M | 3.3%, 10/15/2022 (a) | 1,007,754 | |
| 2,000M | Ford Motor Credit Co., LLC, 8.125%, 1/15/2020 | 2,299,870 | |
| General Electric Capital Corp.: | |||
| 1,000M | 4.65%, 10/17/2021 | 1,098,344 | |
| 1,500M | 6.75%, 3/15/2032 | 2,025,676 | |
| 2,100M | Key Bank NA, 3.4%, 5/20/2026 | 2,046,188 | |
| 2,000M | Liberty Mutual Group, Inc., 4.95%, 5/1/2022 (a) | 2,175,438 | |
| 1,000M | Protective Life Corp., 7.375%, 10/15/2019 | 1,124,422 | |
| 2,000M | Prudential Financial, Inc., 7.375%, 6/15/2019 | 2,230,976 | |
| 2,000M | State Street Corp., 3.55%, 8/18/2025 | 2,057,574 | |
| 24,680,748 | |||
| Financials—5.3% | |||
| Bank of America Corp.: | |||
| 3,600M | 4.1%, 7/24/2023 | 3,776,126 | |
| 1,000M | 5.875%, 2/7/2042 | 1,206,890 | |
| Barclays Bank, PLC: | |||
| 1,100M | 6.75%, 5/22/2019 | 1,204,263 | |
| 1,000M | 5.125%, 1/8/2020 | 1,067,770 | |
| 1,000M | Capital One Financial Corp., 3.75%, 4/24/2024 | 1,018,548 | |
| Citigroup, Inc.: | |||
| 3,600M | 6.125%, 11/21/2017 | 3,702,722 | |
| 1,000M | 8.5%, 5/22/2019 | 1,131,328 | |
| 1,000M | 4.5%, 1/14/2022 | 1,071,323 | |
| 1,500M | Deutsche Bank AG, 3.7%, 5/30/2024 | 1,476,687 | |
| 160 |
| Principal | |||
| Amount | Security | Value | |
| Financials (continued) | |||
| $ 2,000M | General Motors Financial Co., 5.25%, 3/1/2026 | $ 2,152,580 | |
| Goldman Sachs Group, Inc.: | |||
| 2,700M | 5.375%, 3/15/2020 | 2,929,011 | |
| 1,000M | 3.625%, 1/22/2023 | 1,026,473 | |
| 1,000M | 6.125%, 2/15/2033 | 1,210,528 | |
| JPMorgan Chase & Co.: | |||
| 3,100M | 6%, 1/15/2018 | 3,205,012 | |
| 1,000M | 4.5%, 1/24/2022 | 1,078,397 | |
| 1,000M | 3.625%, 12/1/2027 | 972,292 | |
| 5,550M | Morgan Stanley, 5.5%, 7/28/2021 | 6,160,639 | |
| 1,600M | SunTrust Banks, Inc., 6%, 9/11/2017 | 1,631,789 | |
| U.S. Bancorp: | |||
| 1,000M | 4.125%, 5/24/2021 | 1,069,768 | |
| 1,000M | 3.6%, 9/11/2024 | 1,030,793 | |
| 1,000M | 3.1%, 4/27/2026 | 984,302 | |
| 1,500M | UBS AG, 4.875%, 8/4/2020 | 1,615,941 | |
| 2,000M | Visa, Inc., 3.15%, 12/14/2025 | 2,009,132 | |
| Wells Fargo & Co.: | |||
| 1,600M | 4.6%, 4/1/2021 | 1,721,058 | |
| 3,500M | 3.45%, 2/13/2023 | 3,534,745 | |
| 47,988,117 | |||
| Food/Beverage/Tobacco—1.1% | |||
| Anheuser-Busch InBev Finance, Inc.: | |||
| 1,000M | 3.75%, 1/15/2022 | 1,049,189 | |
| 1,500M | 3.65%, 2/1/2026 | 1,519,576 | |
| 1,000M | 4.9%, 2/1/2046 | 1,084,992 | |
| 1,750M | Bunge Ltd. Finance Corp., 8.5%, 6/15/2019 | 1,986,098 | |
| 1,500M | Diageo Capital, PLC, 5.75%, 10/23/2017 | 1,535,121 | |
| 1,000M | Ingredion, Inc., 4.625%, 11/1/2020 | 1,074,822 | |
| 2,000M | Mondelez International Holdings, Inc., 2%, 10/28/2021 (a) | 1,926,486 | |
| 10,176,284 | |||
| Food/Drug—.2% | |||
| 2,000M | CVS Health Corp., 3.875%, 7/20/2025 | 2,064,246 | |
| Forest Products/Containers—.2% | |||
| 2,000M | Rock-Tenn Co., 4.9%, 3/1/2022 | 2,168,076 | |
| 161 |
Portfolio of Investments (continued)
TOTAL RETURN FUND
March 31, 2017
| Principal | |||
| Amount | Security | Value | |
| Health Care—.6% | |||
| $ 1,100M | Biogen, Inc., 6.875%, 3/1/2018 | $ 1,151,832 | |
| 2,100M | Express Scripts Holding Co., 4.75%, 11/15/2021 | 2,257,439 | |
| 1,500M | Laboratory Corp. of America, 3.75%, 8/23/2022 | 1,537,713 | |
| 4,946,984 | |||
| Higher Education—.2% | |||
| 1,750M | Yale University, 2.086%, 4/15/2019 | 1,768,368 | |
| Information Technology—.8% | |||
| 1,500M | Apple, Inc., 2.5%, 2/9/2025 | 1,452,696 | |
| 3,000M | Diamond 1 Finance Corp., 3.48%, 6/1/2019 (a) | 3,075,729 | |
| 1,000M | HP Enterprise Co., 2.85%, 10/5/2018 | 1,012,420 | |
| 2,000M | Oracle Corp., 2.4%, 9/15/2023 | 1,948,548 | |
| 7,489,393 | |||
| Manufacturing—.4% | |||
| 1,000M | CRH America, Inc., 8.125%, 7/15/2018 | 1,078,846 | |
| 1,100M | Ingersoll-Rand Global Holdings Co., Ltd., 6.875%, 8/15/2018 | 1,175,295 | |
| 1,100M | Johnson Controls International, PLC, 5%, 3/30/2020 | 1,181,777 | |
| 3,435,918 | |||
| Media-Broadcasting—.6% | |||
| 1,000M | British Sky Broadcasting, PLC, 9.5%, 11/15/2018 (a) | 1,115,729 | |
| Comcast Corp.: | |||
| 1,600M | 5.15%, 3/1/2020 | 1,743,592 | |
| 2,000M | 4.25%, 1/15/2033 | 2,062,704 | |
| 4,922,025 | |||
| Media-Diversified—.1% | |||
| 1,000M | Time Warner, Inc., 3.6%, 7/15/2025 | 990,515 | |
| Metals/Mining—.7% | |||
| 1,500M | Alcoa, Inc., 6.15%, 8/15/2020 | 1,627,500 | |
| 1,000M | Glencore Finance Canada, Ltd., 4.95%, 11/15/2021 (a) | 1,074,910 | |
| 1,500M | Newmont Mining Corp., 5.125%, 10/1/2019 | 1,604,801 | |
| 1,600M | Vale Overseas, Ltd., 5.625%, 9/15/2019 | 1,702,000 | |
| 6,009,211 | |||
| 162 |
| Principal | |||
| Amount | Security | Value | |
| Real Estate—1.9% | |||
| $ 2,000M | Alexandria Real Estate Equities, Inc., 3.95%, 1/15/2028 | $ 1,998,800 | |
| 1,500M | AvalonBay Communities, Inc., 3.5%, 11/15/2024 | 1,519,170 | |
| 1,000M | Boston Properties, LP, 5.875%, 10/15/2019 | 1,082,814 | |
| 500M | Digital Realty Trust, LP, 5.25%, 3/15/2021 | 542,964 | |
| 1,000M | ERP Operating, LP, 3.375%, 6/1/2025 | 992,250 | |
| 1,000M | HCP, Inc., 4.25%, 11/15/2023 | 1,034,820 | |
| 1,000M | Prologis, LP, 3.35%, 2/1/2021 | 1,030,548 | |
| 2,000M | Realty Income Corp., 3.25%, 10/15/2022 | 2,021,748 | |
| 2,000M | Simon Property Group, LP, 3.375%, 10/1/2024 | 2,017,926 | |
| 1,600M | Ventas Realty, LP, 4.75%, 6/1/2021 | 1,714,334 | |
| 3,000M | Welltower, Inc., 4%, 6/1/2025 | 3,045,909 | |
| 17,001,283 | |||
| Retail-General Merchandise—.6% | |||
| 1,000M | Amazon.com, Inc., 4.8%, 12/5/2034 | 1,110,626 | |
| 3,000M | Home Depot, Inc., 5.875%, 12/16/2036 | 3,802,578 | |
| 4,913,204 | |||
| Telecommunications—.2% | |||
| 1,500M | AT&T, Inc., 3.8%, 3/15/2022 | 1,553,293 | |
| Transportation—.5% | |||
| 1,000M | Burlington North Santa Fe, LLC, 5.15%, 9/1/2043 | 1,143,561 | |
| 1,000M | Penske Truck Leasing Co., LP, 4.875%, 7/11/2022 (a) | 1,080,771 | |
| Southwest Airlines Co.: | |||
| 1,000M | 2.65%, 11/5/2020 | 1,012,141 | |
| 1,000M | 3%, 11/15/2026 | 945,998 | |
| 4,182,471 | |||
| Utilities—1.6% | |||
| 2,000M | Duke Energy Progress, Inc., 4.15%, 12/1/2044 | 2,035,918 | |
| 1,000M | E.ON International Finance BV, 5.8%, 4/30/2018 (a) | 1,041,828 | |
| 1,000M | Electricite de France SA, 3.625%, 10/13/2025 (a) | 1,007,231 | |
| 2,000M | Entergy Arkansas, Inc., 4.95%, 12/15/2044 | 2,044,904 | |
| 1,500M | Exelon Generation Co., LLC, 5.2%, 10/1/2019 | 1,605,639 | |
| 2,000M | Ohio Power Co., 5.375%, 10/1/2021 | 2,229,502 | |
| 163 |
Portfolio of Investments (continued)
TOTAL RETURN FUND
March 31, 2017
| Principal | |||
| Amount | Security | Value | |
| Utilities (continued) | |||
| $ 2,000M | Oklahoma Gas & Electric Co., 4%, 12/15/2044 | $ 1,924,518 | |
| 1,100M | Sempra Energy, 9.8%, 2/15/2019 | 1,255,198 | |
| 1,000M | South Carolina Electric & Gas Co., 5.45%, 2/1/2041 | 1,126,717 | |
| 14,271,455 | |||
| Total Value of Corporate Bonds (cost $185,948,553) | 188,263,574 | ||
| RESIDENTIAL MORTGAGE-BACKED | |||
| SECURITIES—5.8% | |||
| Fannie Mae—4.8% | |||
| 2,910M | 2.5%, 2/1/2030 – 8/1/2031 | 2,917,736 | |
| 4,541M | 3%, 3/1/2027 – 2/1/2031 | 4,667,651 | |
| 6,745M | 3.5%, 11/1/2028 – 11/1/2046 | 6,925,461 | |
| 19,724M | 4%, 12/1/2040 – 8/1/2046 | 20,751,475 | |
| 2,498M | 4.5%, 9/1/2040 – 1/1/2047 | 2,689,498 | |
| 2,225M | 5%, 4/1/2040 – 3/1/2042 | 2,448,530 | |
| 784M | 5.5%, 5/1/2033 – 10/1/2039 | 879,566 | |
| 625M | 6%, 5/1/2036 – 10/1/2040 | 706,691 | |
| 282M | 6.5%, 11/1/2033 – 6/1/2036 | 313,794 | |
| 562M | 7%, 3/1/2032 – 8/1/2032 | 610,705 | |
| 42,911,107 | |||
| Freddie Mac—1.0% | |||
| 1,990M | 3.5%, 8/1/2026 – 7/1/2044 | 2,067,298 | |
| 998M | 4%, 7/1/2044 – 4/1/2045 (b) | 1,048,268 | |
| 4,417M | 4.5%, 10/1/2040 – 5/1/2044 | 4,766,156 | |
| 1,004M | 5.5%, 5/1/2038 – 10/1/2039 | 1,136,768 | |
| 9,018,490 | |||
| Total Value of Residential Mortgage-Backed Securities (cost $51,864,702) | 51,929,597 | ||
| U.S. GOVERNMENT OBLIGATIONS—3.2% | |||
| 5,000M | U.S. Treasury Bonds, 3.125%, 8/15/2044 | 5,098,535 | |
| U.S. Treasury Note: | |||
| 13,000M | (TIPS) 0.375%, 1/15/2027 | 13,019,696 | |
| 10,500M | 0.9215%, 1/31/2019 † | 10,509,649 | |
| Total Value of U.S. Government Obligations (cost $28,878,591) | 28,627,880 | ||
| 164 |
| Principal | |||
| Amount | Security | Value | |
| ASSET BACKED SECURITIES—2.4% | |||
| Fixed Autos—1.8% | |||
| $ 1,700M | AmeriCredit Auto Receivable Trust, 1.83%, 12/8/2021 | $ 1,683,658 | |
| 2,000M | Avis Budget Rental Car Funding AESOP, LLC, 2.97%, | ||
| 2/20/2020 (a) | 2,031,990 | ||
| 1,000M | CarMax Auto Owner Trust, 1.92%, 7/15/2022 | 985,437 | |
| 900M | Ford Credit Auto Lease Trust, 1.85%, 7/15/2019 | 902,594 | |
| 1,000M | GM Financial Auto Leasing Trust, 1.76%, 3/20/2020 | 998,828 | |
| 900M | Hertz Vehicle Financing, LLC, 2.65%, 7/25/2022 (a) | 883,186 | |
| 1,000M | Honda Auto Receivables Trust, 1.33%, 11/18/2022 | 988,220 | |
| 2,300M | Hyundai Capital America Trust, 2.19%, 11/15/2022 | 2,283,918 | |
| 1,150M | Nissan Auto Lease Trust, 1.65%, 10/15/2021 | 1,150,696 | |
| 2,500M | Nissan Auto Receivables Owner Trust, 1.79%, 1/17/2022 | 2,501,598 | |
| 650M | Toyota Auto Receivables Owner Trust, 1.32%, 11/15/2021 | 640,412 | |
| 1,150M | Volkswagen Auto Lease Trust, 1.25%, 12/20/2017 | 1,150,304 | |
| 16,200,841 | |||
| Fixed Credit Cards—.4% | |||
| 1,000M | Capital One Multi-Asset Execution Trust, 1.33%, 6/15/2022 | 989,777 | |
| 500M | Chase Issuance Trust, 1.27%, 7/15/2021 | 494,862 | |
| 1,665M | Synchrony Credit Card Master Trust, 2.38%, 9/15/2023 | 1,680,306 | |
| 3,164,945 | |||
| Fixed Communications—.2% | |||
| 1,900M | Verizon Owner Trust, 2.65%, 9/20/2021 (a) | 1,905,115 | |
| Total Value of Asset Backed Securities (cost $21,375,964) | 21,270,901 | ||
| VARIABLE AND FLOATING RATE NOTES—1.4% | |||
| U.S. Government Agency Obligations—.4% | |||
| 4,000M | Federal Home Loan Bank, 0.661%, 8/14/2017 † | 4,000,136 | |
| Municipal Bonds—1.0% | |||
| 3,000M | Mass. St. Hlth. & Edl. Facs. Auth., 0.92%, 8/15/2034 † | 3,000,000 | |
| 3,000M | Mississippi Business Fin. Corp., 0.91%, 12/1/2030 † | 3,000,000 | |
| 3,000M | Valdez, AK Marine Term. Rev., 0.86%, 12/1/2033 † | 3,000,000 | |
| 9,000,000 | |||
| Total Value of Variable and Floating Rate Notes (cost $13,000,060) | 13,000,136 | ||
| TAXABLE MUNICIPAL BONDS—.3% | |||
| 2,850M | Ford Foundation, 3.859%, 6/1/2047 (cost $2,850,696) | 2,882,541 | |
| 165 |
Portfolio of Investments (continued)
TOTAL RETURN FUND
March 31, 2017
| Principal | |||
| Amount | Security | Value | |
| U.S. GOVERNMENT AGENCY OBLIGATIONS—.2% | |||
| $ 1,850M | Fannie Mae, 1.75%, 11/26/2019 (cost $1,845,560) | $ 1,862,695 | |
| SHORT-TERM U.S. GOVERNMENT AGENCY | |||
| OBLIGATIONS—4.4% | |||
| Federal Home Loan Bank: | |||
| 5,000M | 0.7%, 4/24/2017 | 4,998,015 | |
| 10,500M | 0.71%, 4/21/2017 | 10,496,430 | |
| 12,000M | 0.74%, 4/26/2017 | 11,994,792 | |
| 8,000M | 0.75%, 4/17/2017 | 7,997,888 | |
| 4,000M | 0.75%, 4/19/2017 | 3,998,792 | |
| Total Value of Short-Term U.S. Government | |||
| Agency Obligations (cost $39,483,285) | 39,485,917 | ||
| SHORT-TERM CORPORATE NOTES—2.1% | |||
| Energy—.0% | |||
| 425M | Chevron Corp., 0.95%, 7/10/2017 (c) | 423,921 | |
| Food/Beverage/Tobacco—.6% | |||
| Coca-Cola Co.: | |||
| 500M | 0.96%, 7/14/2017 (c) | 498,593 | |
| 5,000M | 1%, 7/25/2017 (c) | 4,983,986 | |
| 5,482,579 | |||
| Information Technology—.5% | |||
| 5,000M | Apple, Inc., 0.86%, 7/5/2017 (c) | 4,989,213 | |
| Media-Diversified—.4% | |||
| 3,500M | Walt Disney Co., 0.78%, 4/17/2017 (c) | 3,498,664 | |
| Retail-General Merchandise—.6% | |||
| 5,000M | Wal-Mart Stores, Inc., 0.81%, 4/17/2017 (c) | 4,998,163 | |
| Total Value of Short-Term Corporate Notes (cost $19,392,144) | 19,392,540 | ||
| 166 |
| Principal | |||||||
| Amount | Security | Value | |||||
| SHORT-TERM U.S. GOVERNMENT | |||||||
| OBLIGATIONS—.2% | |||||||
| $ 2,000M | U.S. Treasury Bills, 0.721%, 4/27/2017 (cost $1,998,958) | $ 1,999,034 | |||||
| Total Value of Investments (cost $714,427,154) | 100.2 | % | 902,870,059 | ||||
| Excess of Liabilities Over Other Assets | (.2 | ) | (1,463,712) | ||||
| Net Assets | 100.0 | % | $901,406,347 | ||||
| * | Non-income producing | |
| (a) | Security exempt from registration under Rule 144A of the Securities Act of 1933 (see Note 4). | |
| (b) | A portion or all of the security purchased on a when-issued or delayed delivery basis (see | |
| Note 1G). | ||
| (c) | Security exempt from registration under Section 4(2) of the Securities Act of 1933 (see Note 4). | |
| † | Interest rates on adjustable rate bonds are determined and reset periodically. The interest rates | |
| shown are the rates in effect of March 31, 2017. | ||
| Summary of Abbreviations: | ||
| ADR | American Depositary Receipts | |
| ETF | Exchange Traded Fund | |
| REIT | Real Estate Investment Trust | |
| TIPS | Treasury Inflation-Protected Securities | |
The Fund’s assets and liabilities are classified into the following three levels based on the inputs used to value the assets or liabilities:
| Level 1 — Unadjusted quoted prices in active markets for identical securities that the Fund has the ability to access. |
| Level 2 — Observable inputs other than quoted prices included in Level 1 that are observable for the asset or liability, either directly or indirectly. These inputs may include quoted prices for the identical instrument on an inactive market, prices for similar instruments, interest rates, prepayment speeds, credit risk, yield curves, default rates and similar data. |
| Level 3 — Unobservable inputs for the asset or liability, to the extent relevant observable inputs are not available, representing the Fund’s own assumption about the assumptions a market participant would use in valuing the asset or liability, and would be based on the best information available. |
The inputs methodology used for valuing securities are not necessarily an indication of the risk associated with investing in those securities. For example, U.S. Government securities are reflected as Level 2 because the inputs used to determine fair value may not always be quoted prices in an active market.
| 167 |
Portfolio of Investments (continued)
TOTAL RETURN FUND
March 31, 2017
The following is a summary, by category of Level, of inputs used to value the Fund’s investments as of March 31, 2017:
| Level 1 | Level 2 | Level 3 | Total | |||||||||
| Common Stocks | $ | 534,155,244 | $ | — | $ | — | $ | 534,155,244 | ||||
| Corporate Bonds | — | 188,263,574 | — | 188,263,574 | ||||||||
| Residential Mortgage-Backed | ||||||||||||
| Securities | — | 51,929,597 | — | 51,929,597 | ||||||||
| U.S. Government Obligations | — | 28,627,880 | — | 28,627,880 | ||||||||
| Asset Backed Securities | — | 21,270,901 | — | 21,270,901 | ||||||||
| Variable and Floating Rate Notes | ||||||||||||
| U.S. Government Agency | ||||||||||||
| Obligations | — | 4,000,136 | — | 4,000,136 | ||||||||
| Municipal Bonds | — | 9,000,000 | — | 9,000,000 | ||||||||
| Taxable Municipal Bonds | — | 2,882,541 | — | 2,882,541 | ||||||||
| U.S. Government Agency | ||||||||||||
| Obligations | — | 1,862,695 | — | 1,862,695 | ||||||||
| Short-Term U.S. Government | ||||||||||||
| Agency Obligations | — | 39,485,917 | — | 39,485,917 | ||||||||
| Short-Term Corporate Notes | — | 19,392,540 | — | 19,392,540 | ||||||||
| Short-Term U.S. Government | ||||||||||||
| Obligations | — | 1,999,034 | — | 1,999,034 | ||||||||
| Total Investments in Securities* | $ | 534,155,244 | $ | 368,714,815 | $ | — | $ | 902,870,059 |
| * | The Portfolio of Investments provides information on the industry categorization for common stocks, |
| corporate bonds and asset backed securities. | |
| There were no transfers into or from Level 1 or Level 2 by the Fund for the year ended March 31, 2017. | |
| Transfers, if any, between Levels are recognized at the end of the reporting period. |
| 168 | See notes to financial statements |
| This page left intentionally blank. |
| 169 |
Statements of Assets and Liabilities
FIRST INVESTORS INCOME FUNDS
March 31, 2017
| GOVERNMENT | ||||||||||||||
| BALANCED | FLOATING | FUND FOR | CASH | |||||||||||
| INCOME | RATE | INCOME | GOVERNMENT | MANAGEMENT | ||||||||||
| Assets | ||||||||||||||
| Investments in securities | ||||||||||||||
| At identified cost | $ | 42,243,421 | $ | 155,394,780 | $ | 655,614,138 | $ | 327,796,393 | $ | 134,386,760 | ||||
| At value (Note 1A) | $ | 43,355,735 | $ | 156,377,782 | $ | 673,333,924 | $ | 325,534,482 | $ | 134,386,760 | ||||
| Cash | 507,472 | 8,283,705 | 4,361,707 | 4,244,136 | 2,003,142 | |||||||||
| Receivables: | ||||||||||||||
| Investment securities sold | 4,501 | 3,394,174 | 11,435,585 | — | — | |||||||||
| Deposits at broker for futures contracts | 335,472 | — | — | — | — | |||||||||
| Interest and dividends | 227,255 | 506,559 | 10,534,540 | 868,730 | 14,188 | |||||||||
| Shares sold | 153,586 | 145,854 | 380,681 | 133,422 | — | |||||||||
| Other assets | 2,164 | 11,355 | 51,098 | 24,907 | 9,094 | |||||||||
| Total Assets | 44,586,185 | 168,719,429 | 700,097,535 | 330,805,677 | 136,413,184 | |||||||||
| Liabilities | ||||||||||||||
| Payables: | ||||||||||||||
| Investment securities purchased | 231,809 | 14,758,835 | 4,692,348 | 10,024,656 | — | |||||||||
| Due to broker-variation margin futures | 46,643 | — | — | — | — | |||||||||
| Shares redeemed | 114,781 | 219,635 | 1,190,861 | 435,806 | 1,801,287 | |||||||||
| Dividends payable | 1,301 | 61,435 | 590,718 | 24,396 | — | |||||||||
| Accrued advisory fees | 9,581 | 19,982 | 411,626 | 146,909 | 11,374 | |||||||||
| Accrued shareholder servicing costs | 7,805 | 33,779 | 118,377 | 66,245 | 41,582 | |||||||||
| Accrued expenses | 63,032 | 98,379 | 107,885 | 44,182 | 31,608 | |||||||||
| Total Liabilities | 474,952 | 15,192,045 | 7,111,815 | 10,742,194 | 1,885,851 | |||||||||
| Net Assets | $ | 44,111,233 | $ | 153,527,384 | $ | 692,985,720 | $ | 320,063,483 | $ | 134,527,333 | ||||
| Net Assets Consist of: | ||||||||||||||
| Capital paid in | $ | 42,804,388 | $ | 156,501,881 | $ | 856,134,940 | $ | 340,124,498 | $ | 134,527,333 | ||||
| Undistributed net investment income (deficit) | (88,410 | ) | (25,408 | ) | (3,821,216 | ) | (627,086 | ) | — | |||||
| Accumulated net realized gain (loss) on investments and futures contracts | 282,941 | (3,932,091 | ) | (177,047,790 | ) | (17,172,018 | ) | — | ||||||
| Net unrealized appreciation (depreciation) in value on investments and | ||||||||||||||
| futures contracts | 1,112,314 | 983,002 | 17,719,786 | (2,261,911 | ) | — | ||||||||
| Total | $ | 44,111,233 | $ | 153,527,384 | $ | 692,985,720 | $ | 320,063,483 | $ | 134,527,333 | ||||
| 170 | See notes to financial statements | 171 |
Statements of Assets and Liabilities
FIRST INVESTORS INCOME FUNDS
March 31, 2017
| GOVERNMENT | ||||||||||
| BALANCED | FLOATING | FUND FOR | CASH | |||||||
| INCOME | RATE | INCOME | GOVERNMENT | MANAGEMENT | ||||||
| Net Assets: | ||||||||||
| Class A | $ | 43,758,401 | $ | 65,660,050 | $ | 566,201,251 | $ | 240,639,957 | $ | 131,430,242 |
| Class B | N/A | N/A | $ | 2,620,224 | $ | 1,445,652 | $ | 232,824 | ||
| Advisor Class | $ | 110,559 | $ | 67,603,934 | $ | 62,283,093 | $ | 69,446,838 | N/A | |
| Institutional Class | $ | 242,273 | $ | 20,263,400 | $ | 61,881,152 | $ | 8,531,036 | $ | 2,864,267 |
| Shares outstanding (Note 7): | ||||||||||
| Class A | 4,083,129 | 6,791,884 | 227,591,720 | 23,062,242 | 131,430,242 | |||||
| Class B | N/A | N/A | 1,052,802 | 138,833 | 232,824 | |||||
| Advisor Class | 10,284 | 6,994,305 | 25,047,014 | 6,645,223 | N/A | |||||
| Institutional Class | 22,524 | 2,098,315 | 24,791,640 | 811,799 | 2,864,267 | |||||
| Net asset value and redemption price per share — Class A | $ | 10.72 | $ | 9.67 | $ | 2.49 | $ | 10.43 | $ | 1.00 |
| Maximum offering price per share — Class A (Net asset value/.9425)* | $ | 11.37 | $ | 10.26 | $ | 2.64 | $ | 11.07 | N/A | |
| Net asset value and offering price per share — Class B** | N/A | N/A | $ | 2.49 | $ | 10.41 | $ | 1.00 | ||
| Net asset value, offering price and redemption price | ||||||||||
| per share — Advisor Class | $ | 10.75 | $ | 9.67 | $ | 2.49 | $ | 10.45 | N/A | |
| Net asset value, offering price and redemption price | ||||||||||
| per share — Institutional Class | $ | 10.76 | $ | 9.66 | $ | 2.50 | $ | 10.51 | $ | 1.00 |
| # | Also maximum offering price per share. |
| * | On purchases of $100,000 or more, the sales charge is reduced (Note 7). |
| ** | Redemption price is equal to net asset value less contingent deferred sales charges, if applicable |
| (Note 7). |
| 172 | See notes to financial statements | 173 |
Statements of Assets and Liabilities
FIRST INVESTORS INCOME FUNDS
March 31, 2017
| INTERNATIONAL | LIMITED | |||||||||||
| OPPORTUNITIES | INVESTMENT | DURATION HIGH | STRATEGIC | |||||||||
| BOND | GRADE | QUALITY BOND | INCOME | |||||||||
| Assets | ||||||||||||
| Investments in securities: | ||||||||||||
| Cost — Unaffiliated issuers | $ | 127,765,735 | $ | 562,912,655 | $ | 133,431,337 | $ | 7,503,562 | ||||
| Cost — Affiliated issuers (Note 2) | — | — | — | 154,426,480 | ||||||||
| Total cost of investments | $ | 127,765,735 | $ | 562,912,655 | $ | 133,431,337 | $ | 161,930,042 | ||||
| Value — Unaffiliated issuers (Note 1A) | $ | 116,769,907 | $ | 573,367,691 | $ | 132,739,215 | $ | 7,503,175 | ||||
| Value — Affiliated issuers (Note 2) | — | — | — | 150,059,723 | ||||||||
| Total value of investments | 116,769,907 | 573,367,691 | 132,739,215 | 157,562,898 | ||||||||
| Cash | 3,920,829 | 7,643,123 | 3,356,577 | 984,082 | ||||||||
| Receivables: | ||||||||||||
| Investment securities sold | 6,354,420 | 1,784,880 | 1,696,024 | — | ||||||||
| Dividends and interest | 1,333,219 | 6,673,066 | 1,042,465 | 461,722 | ||||||||
| Shares sold | 58,292 | 295,962 | 248,246 | 304,655 | ||||||||
| Unrealized gain on foreign exchange contracts (Note 5) | 775,879 | — | — | — | ||||||||
| Other assets | 8,750 | 42,512 | 8,788 | 10,774 | ||||||||
| Total Assets | 129,221,296 | 589,807,234 | 139,091,315 | 159,324,131 | ||||||||
| Liabilities | ||||||||||||
| Payables: | ||||||||||||
| Investment securities purchased | 1,826,864 | 1,781,604 | 998,490 | — | ||||||||
| Shares redeemed | 178,464 | 790,149 | 186,048 | 382,401 | ||||||||
| Dividends payable | — | 175,025 | 54,960 | 15,936 | ||||||||
| Unrealized loss on foreign exchange contracts (Note 5) | 122,565 | — | — | — | ||||||||
| Accrued advisory fees | 78,318 | 272,457 | 51,687 | 6,683 | ||||||||
| Accrued shareholder servicing costs | 37,515 | 91,874 | 33,327 | 19,219 | ||||||||
| Accrued expenses | 85,666 | 51,108 | 34,960 | 23,876 | ||||||||
| Total Liabilities | 2,329,392 | 3,162,217 | 1,359,472 | 448,115 | ||||||||
| Net Assets | $ | 126,891,904 | $ | 586,645,017 | $ | 137,731,843 | $ | 158,876,016 | ||||
| Net Assets Consist of: | ||||||||||||
| Capital paid in | $ | 142,224,993 | $ | 595,112,787 | $ | 141,949,716 | $ | 165,196,432 | ||||
| Undistributed net investment income (deficit) | 182,846 | (15,451,697 | ) | (2,718,659 | ) | 316,656 | ||||||
| Accumulated net realized loss on investments, futures contracts | ||||||||||||
| and foreign currency transactions | (5,183,597 | ) | (3,471,109 | ) | (807,092 | ) | (2,269,928 | ) | ||||
| Net unrealized appreciation (depreciation) in value of investments | ||||||||||||
| and foreign currency transactions | (10,332,338 | ) | 10,455,036 | (692,122 | ) | (4,367,144 | ) | |||||
| Total | $ | 126,891,904 | $ | 586,645,017 | $ | 137,731,843 | $ | 158,876,016 | ||||
| 174 | See notes to financial statements | 175 |
Statements of Assets and Liabilities
FIRST INVESTORS INCOME FUNDS
March 31, 2017
| INTERNATIONAL | LIMITED | |||||||
| OPPORTUNITIES | INVESTMENT | DURATION HIGH | STRATEGIC | |||||
| BOND | GRADE | QUALITY BOND | INCOME | |||||
| Net Assets: | ||||||||
| Class A | $ | 59,113,125 | $ | 462,192,991 | $ | 59,188,239 | $ | 158,180,329 |
| Class B | N/A | $ | 2,521,388 | N/A | N/A | |||
| Advisor Class | $ | 59,208,395 | $ | 92,380,704 | $ | 55,152,025 | $ | 695,687 |
| Institutional Class | $ | 8,570,384 | $ | 29,549,934 | $ | 23,391,579 | N/A | |
| Shares outstanding (Note 7): | ||||||||
| Class A | 6,569,947 | 48,402,786 | 6,241,159 | 16,754,067 | ||||
| Class B | N/A | 265,663 | N/A | N/A | ||||
| Advisor Class | 6,542,469 | 9,626,273 | 5,797,796 | 73,807 | ||||
| Institutional Class | 942,127 | 3,086,615 | 2,456,399 | N/A | ||||
| Net asset value and redemption price per share — Class A | $ | 9.00 | $ | 9.55 | $ | 9.48 | $ | 9.44 |
| Maximum offering price per share — Class A (Net asset value/.9425)* | $ | 9.55 | $ | 10.13 | $ | 10.06 | $ | 10.02 |
| Net asset value and offering price per share — Class B** | N/A | $ | 9.49 | N/A | N/A | |||
| Net asset value, offering price and redemption price | ||||||||
| per share — Advisor Class | $ | 9.05 | $ | 9.60 | $ | 9.51 | $ | 9.43 |
| Net asset value, offering price and redemption price | ||||||||
| per share — Institutional Class | $ | 9.10 | $ | 9.57 | $ | 9.52 | N/A | |
| * | On purchases of $100,000 or more, the sales charge is reduced (Note 7). |
| ** | Redemption price is equal to net asset value less contingent deferred sales charges, if applicable |
| (Note 7). |
| 176 | See notes to financial statements | 177 |
Statements of Assets and Liabilities
FIRST INVESTORS EQUITY FUNDS
March 31, 2017
| HEDGED U.S. | ||||||||||||||||
| COVERED CALL | EQUITY | GROWTH & | EQUITY | |||||||||||||
| STRATEGY | INCOME | GLOBAL | INCOME | OPPORTUNITIES | INTERNATIONAL | |||||||||||
| Assets | ||||||||||||||||
| Investments in securities | ||||||||||||||||
| At identified cost | $ | 184,035,609 | $ | 439,064,701 | $ | 491,349,562 | $ | 1,127,408,433 | $ | 61,242,618 | $ | 236,739,891 | ||||
| At value (Note 1A) | $ | 195,963,312 | $ | 622,810,622 | $ | 556,846,946 | $ | 1,807,082,073 | $ | 65,495,115 | $ | 308,446,194 | ||||
| Cash | 3,471,901 | 2,030,905 | 2,928,812 | 8,586,522 | 2,616,401 | 210,421 | ||||||||||
| Receivables: | ||||||||||||||||
| Investment securities sold | — | 154,971 | 4,512,221 | 2,340,445 | 20,687 | — | ||||||||||
| Options contracts sold | 40,431 | — | — | — | — | — | ||||||||||
| Deposits at broker for futures contracts | — | — | — | — | 739,598 | — | ||||||||||
| Dividends and interest | 202,187 | 973,075 | 876,200 | 2,383,056 | 64,333 | 1,393,571 | ||||||||||
| Shares sold | 962,676 | 365,303 | 244,848 | 825,124 | 335,762 | 199,772 | ||||||||||
| Unrealized gain on foreign exchange contracts (Note 5) | — | — | 224,336 | — | — | — | ||||||||||
| Other assets | 7,465 | 41,560 | 36,555 | 123,199 | 45,578 | 21,045 | ||||||||||
| Total Assets | 200,647,972 | 626,376,436 | 565,669,918 | 1,821,340,419 | 69,317,474 | 310,271,003 | ||||||||||
| Liabilities | ||||||||||||||||
| Options written, at value (Note 5) | 2,736,462 | (a) | 350 | (b) | — | — | 149,367 | (c) | — | |||||||
| Payables: | ||||||||||||||||
| Investment securities purchased | — | 1,224,030 | 1,540,904 | 1,398,890 | 34,662 | 873,434 | ||||||||||
| Shares redeemed | 222,390 | 1,419,446 | 895,360 | 3,872,124 | 9,330 | 574,548 | ||||||||||
| Unrealized loss on foreign exchange, options and futures contracts (Note 5) | — | — | 22,120 | — | 1,956 | — | ||||||||||
| Accrued advisory fees | 77,790 | 388,852 | 427,232 | 1,051,030 | 54,198 | 251,352 | ||||||||||
| Accrued shareholder servicing costs | 27,648 | 84,737 | 89,280 | 254,462 | 21,956 | 70,720 | ||||||||||
| Accrued expenses | 29,819 | 50,922 | 136,344 | 128,785 | 44,448 | 97,316 | ||||||||||
| Total Liabilities | 3,094,109 | 3,168,337 | 3,111,240 | 6,705,291 | 315,917 | 1,867,370 | ||||||||||
| Net Assets | $ | 197,553,863 | $ | 623,208,099 | $ | 562,558,678 | $ | 1,814,635,128 | $ | 69,001,557 | $ | 308,403,633 | ||||
| Net Assets Consist of: | ||||||||||||||||
| Capital paid in | $ | 187,894,443 | $ | 429,757,415 | $ | 491,968,258 | $ | 1,094,380,752 | $ | 66,273,454 | $ | 260,979,166 | ||||
| Undistributed net investment income (deficit) | 35,231 | 1,909,844 | 916 | 7,079,982 | (11,531 | ) | (118,920 | ) | ||||||||
| Accumulated net realized gain (loss) on investments, options and futures | ||||||||||||||||
| contracts, and foreign currency transactions | (3,611,893 | ) | 7,792,409 | 4,893,054 | 33,500,754 | (1,692,602 | ) | (24,122,486 | ) | |||||||
| Net unrealized appreciation in value of investments, options and futures | ||||||||||||||||
| contracts, and foreign currency transactions | 13,236,082 | 183,748,431 | 65,696,450 | 679,673,640 | 4,432,236 | 71,665,873 | ||||||||||
| Total | $ | 197,553,863 | $ | 623,208,099 | $ | 562,558,678 | $ | 1,814,635,128 | $ | 69,001,557 | $ | 308,403,633 | ||||
| (a) Premiums received from written options $4,044,841 |
| (b) Premiums received from written options $2,860 |
| (c) Premiums received from written options $330,967 |
| 178 | See notes to financial statements | 179 |
Statements of Assets and Liabilities
FIRST INVESTORS EQUITY FUNDS
March 31, 2017
| HEDGED U.S. | ||||||||||||
| COVERED CALL | EQUITY | GROWTH & | EQUITY | |||||||||
| STRATEGY | INCOME | GLOBAL | INCOME | OPPORTUNITIES | INTERNATIONAL | |||||||
| Net Assets: | ||||||||||||
| Class A | $ | 122,681,886 | $ | 552,205,032 | $ | 354,795,961 | $ | 1,632,735,368 | $ | 34,618,466 | $ | 208,083,946 |
| Class B | N/A | $ | 3,210,756 | $ | 2,755,815 | $ | 15,525,852 | N/A | $ | 1,383,895 | ||
| Advisor Class | $ | 68,490,519 | $ | 65,505,848 | $ | 201,553,830 | $ | 155,799,925 | $ | 34,009,759 | $ | 96,310,660 |
| Institutional Class | $ | 6,381,458 | $ | 2,286,463 | $ | 3,453,072 | $ | 10,573,983 | $ | 373,332 | $ | 2,625,132 |
| Shares outstanding (Note 7): | ||||||||||||
| Class A | 11,255,211 | 53,970,080 | 45,031,792 | 73,871,489 | 3,344,911 | 14,951,872 | ||||||
| Class B | N/A | 320,590 | 438,915 | 759,322 | N/A | 106,149 | ||||||
| Advisor Class | 6,302,435 | 6,388,371 | 25,119,934 | 6,989,903 | 3,280,332 | 6,830,162 | ||||||
| Institutional Class | 586,578 | 222,028 | 428,244 | 476,467 | 35,980 | 185,764 | ||||||
| Net asset value and redemption price per share — Class A | $ | 10.90 | $ | 10.23 | $ | 7.88 | $ | 22.10 | $ | 10.35 | $ | 13.92 |
| Maximum offering price per share — Class A (Net asset value/.9425)* | $ | 11.56 | $ | 10.85 | $ | 8.36 | $ | 23.45 | $ | 10.98 | $ | 14.77 |
| Net asset value and offering price per share — Class B** | N/A | $ | 10.02 | $ | 6.28 | $ | 20.45 | N/A | $ | 13.04 | ||
| Net asset value, offering price and redemption price | ||||||||||||
| per share — Advisor Class | $ | 10.87 | $ | 10.25 | $ | 8.02 | $ | 22.29 | $ | 10.37 | $ | 14.10 |
| Net asset value, offering price and redemption price | ||||||||||||
| per share — Institutional Class | $ | 10.88 | $ | 10.30 | $ | 8.06 | $ | 22.19 | $ | 10.38 | $ | 14.13 |
| * | On purchases of $100,000 or more, the sales charge is reduced (Note 7). |
| ** | Redemption price is equal to net asset value less contingent deferred sales charges, if applicable |
| (Note 7). |
| 180 | See notes to financial statements | 181 |
Statements of Assets and Liabilities
FIRST INVESTORS EQUITY FUNDS
March 31, 2017
| REAL | SELECT | SPECIAL | TOTAL | ||||||||||||
| LONG SHORT | OPPORTUNITY | ESTATE | GROWTH | SITUATIONS | RETURN | ||||||||||
| Assets | |||||||||||||||
| Investments in securities: | |||||||||||||||
| At identified cost | $ | 12,122,994 | $ | 735,457,503 | $ | 97,899,398 | $ | 394,333,580 | $ | 450,801,330 | $ | 714,427,154 | |||
| At value (Note 1A) | $ | 12,772,926 | $ | 1,033,810,025 | $ | 99,183,825 | $ | 485,798,389 | $ | 588,119,589 | $ | 902,870,059 | |||
| Cash | 2,313,598 | 2,689,019 | 1,789,812 | 1,800,797 | 5,627,594 | 4,595,136 | |||||||||
| Cash held at broker for securities sold short | 8,100,946 | — | — | — | — | — | |||||||||
| Receivables: | |||||||||||||||
| Investment securities sold | 972,568 | 5,323,795 | — | — | 111,114 | 3,904,837 | |||||||||
| Dividends and interest | 6,249 | 814,253 | 297,307 | 246,960 | 485,037 | 3,145,564 | |||||||||
| Shares sold | 172,166 | 678,842 | 126,670 | 359,141 | 473,271 | 554,277 | |||||||||
| Other assets | — | 68,644 | 5,917 | 31,384 | 38,239 | 64,947 | |||||||||
| Total Assets | 24,338,453 | $ | 1,043,384,578 | 101,403,531 | 488,236,671 | 594,854,844 | 915,134,820 | ||||||||
| Liabilities | |||||||||||||||
| Securities sold short (at value) | 8,449,087 | (d) | — | — | — | — | — | ||||||||
| Payables: | |||||||||||||||
| Investment securities purchased | 1,155,249 | 5,245,517 | — | — | 222,430 | 11,151,669 | |||||||||
| Shares redeemed | 449 | 2,037,978 | 104,093 | 883,236 | 876,352 | 1,810,232 | |||||||||
| Accrued advisory fees | 14,064 | 617,939 | 50,833 | 305,036 | 405,857 | 532,932 | |||||||||
| Accrued shareholder servicing costs | 7,360 | 188,040 | 35,315 | 64,280 | 103,241 | 148,027 | |||||||||
| Accrued expenses | 30,747 | 70,652 | 39,107 | 33,223 | 53,555 | 85,613 | |||||||||
| Total Liabilities | 9,656,956 | 8,160,126 | 229,348 | 1,285,775 | 1,661,435 | 13,728,473 | |||||||||
| Net Assets | $ | 14,681,497 | $ | 1,035,224,452 | $ | 101,174,183 | $ | 486,950,896 | $ | 593,193,409 | $ | 901,406,347 | |||
| Net Assets Consist of: | |||||||||||||||
| Capital paid in | $ | 14,344,556 | $ | 705,833,350 | $ | 99,619,801 | $ | 388,203,786 | $ | 442,307,574 | $ | 711,847,338 | |||
| Undistributed net investment income (deficit) | (60,149 | ) | 1,216,280 | 827,433 | 139,322 | 311,974 | (6,207,420 | ) | |||||||
| Accumulated net realized gain (loss) on investments | (119,800 | ) | 29,822,300 | (557,478 | ) | 7,142,979 | 13,255,602 | 7,323,524 | |||||||
| Net unrealized appreciation in value of investments | 516,890 | 298,352,522 | 1,284,427 | 91,464,809 | 137,318,259 | 188,442,905 | |||||||||
| Total | $ | 14,681,497 | $ | 1,035,224,452 | $ | 101,174,183 | $ | 486,950,896 | $ | 593,193,409 | $ | 901,406,347 | |||
(d) Proceeds from securities sold short $ 8,316,045
| 182 | See notes to financial statements | 183 |
Statements of Assets and Liabilities
FIRST INVESTORS EQUITY FUNDS
March 31, 2017
| REAL | SELECT | SPECIAL | TOTAL | |||||||||
| LONG SHORT | OPPORTUNITY | ESTATE | GROWTH | SITUATIONS | RETURN | |||||||
| Net Assets: | ||||||||||||
| Class A | $ | 4,900,987 | $ | 933,355,181 | $ | 38,134,015 | $ | 398,760,646 | $ | 513,007,416 | $ | 859,298,525 |
| Class B | N/A | $ | 7,929,836 | N/A | $ | 3,200,933 | $ | 3,206,767 | $ | 7,426,613 | ||
| Advisor Class | $ | 9,677,503 | $ | 88,551,571 | $ | 62,459,095 | $ | 80,542,080 | $ | 69,042,208 | $ | 1,066,101 |
| Institutional Class | $ | 103,007 | $ | 5,387,864 | $ | 581,073 | $ | 4,447,237 | $ | 7,937,018 | $ | 33,615,108 |
| Shares outstanding (Note 7): | ||||||||||||
| Class A | 476,537 | 24,120,924 | 3,953,438 | 37,391,512 | 17,854,167 | 44,708,887 | ||||||
| Class B | N/A | 260,903 | N/A | 353,646 | 146,946 | 392,917 | ||||||
| Advisor Class | 940,001 | 2,254,693 | 6,464,203 | 7,448,063 | 2,384,693 | 55,219 | ||||||
| Institutional Class | 10,001 | 137,461 | 60,231 | 409,284 | 272,614 | 1,736,306 | ||||||
| Net asset value and redemption price per share — Class A | $ | 10.28 | $ | 38.69 | $ | 9.65 | $ | 10.66 | $ | 28.73 | $ | 19.22 |
| Maximum offering price per share — Class A (Net asset value/.9425)* | $ | 10.91 | $ | 41.05 | $ | 10.24 | $ | 11.31 | $ | 30.48 | $ | 20.39 |
| Net asset value and offering price per share — Class B** | N/A | $ | 30.39 | N/A | $ | 9.05 | $ | 21.82 | $ | 18.90 | ||
| Net asset value, offering price and redemption price | ||||||||||||
| per share — Advisor Class | $ | 10.30 | $ | 39.27 | $ | 9.66 | $ | 10.81 | $ | 28.95 | $ | 19.31 |
| Net asset value, offering price and redemption price | ||||||||||||
| per share — Institutional Class | $ | 10.30 | $ | 39.20 | $ | 9.65 | $ | 10.87 | $ | 29.11 | $ | 19.36 |
| * | On purchases of $100,000 or more, the sales charge is reduced (Note 7). |
| ** | Redemption price is equal to net asset value less contingent deferred sales charges, if applicable |
| (Note 7). |
| 184 | See notes to financial statements | 185 |
Statements of Operations
FIRST INVESTORS INCOME FUNDS
Six Months Ended March 31, 2017
| GOVERNMENT | |||||||||||||||
| BALANCED | FLOATING | FUND FOR | CASH | ||||||||||||
| INCOME | RATE | INCOME | GOVERNMENT | MANAGEMENT | |||||||||||
| Investment Income | |||||||||||||||
| Interest | $ | 287,110 | $ | 3,095,980 | $ | 20,072,598 | $ | 3,937,547 | $ | 310,628 | |||||
| Dividends | 227,959 | (a) | — | — | — | — | |||||||||
| Total income | 515,069 | 3,095,980 | 20,072,598 | 3,937,547 | 310,628 | ||||||||||
| Expenses (Notes 1 and 3): | |||||||||||||||
| Advisory fees | 130,162 | 430,421 | 2,513,598 | 1,044,065 | 325,777 | ||||||||||
| Distribution plan expenses – Class A | 55,287 | 94,400 | 843,304 | 370,845 | N/A | ||||||||||
| Distribution plan expenses – Class B | N/A | N/A | 13,838 | 8,991 | 964 | ||||||||||
| Shareholder servicing costs – Class A | 29,037 | 51,783 | 425,678 | 209,726 | 233,502 | ||||||||||
| Shareholder servicing costs – Class B | N/A | N/A | 2,790 | 2,524 | 472 | ||||||||||
| Shareholder servicing costs – Advisor Class | 12 | 54,845 | 57,050 | 61,585 | N/A | ||||||||||
| Shareholder servicing costs – Institutional Class | 37 | 2,368 | 10,875 | 16 | 436 | ||||||||||
| Professional fees | 15,199 | 26,126 | 46,351 | 24,787 | 31,000 | ||||||||||
| Custodian fees | 3,861 | 38,011 | 9,057 | 10,491 | 7,242 | ||||||||||
| Registration fees | 44,999 | 40,101 | 40,000 | 50,749 | 37,000 | ||||||||||
| Reports to shareholders | 7,527 | 8,500 | 18,808 | 10,279 | 9,589 | ||||||||||
| Trustees' fees | 933 | 3,944 | 19,550 | 9,051 | 3,652 | ||||||||||
| Other expenses | 5,589 | 39,489 | 64,541 | 25,622 | 15,009 | ||||||||||
| Total expenses | 292,643 | 789,988 | 4,065,440 | 1,828,731 | 664,643 | ||||||||||
| Less: Expenses waived and/or assumed (Note 3) | (78,976 | ) | (95,330 | ) | (81,946 | ) | (173,957 | ) | (352,202 | ) | |||||
| Expenses paid indirectly (Note 1G) | (418 | ) | (1,495 | ) | (7,856 | ) | (3,521 | ) | (1,813 | ) | |||||
| Net expenses | 213,249 | 693,163 | 3,975,638 | 1,651,253 | 310,628 | ||||||||||
| Net investment income | 301,820 | 2,402,817 | 16,096,960 | 2,286,294 | — | ||||||||||
| Realized and Unrealized Gain (Loss) on Investments and | |||||||||||||||
| Futures Contracts (Notes 2 and 5): | |||||||||||||||
| Net realized gain (loss) on: | |||||||||||||||
| Investments | 55,458 | 267,697 | 8,139,593 | (2,881,618 | ) | — | |||||||||
| Futures contracts | 224,027 | — | — | — | — | ||||||||||
| Net realized gain (loss) on investments and futures contracts | 279,485 | 267,697 | 8,139,593 | (2,881,618 | ) | — | |||||||||
| Net unrealized appreciation (depreciation) on: | |||||||||||||||
| Investments | 60,783 | (54,886 | ) | (4,627,646 | ) | (9,040,452 | ) | — | |||||||
| Futures contracts | (10,200 | ) | — | — | — | — | |||||||||
| Net unrealized appreciation (depreciation) on investments and | |||||||||||||||
| futures contracts | 50,583 | (54,886 | ) | (4,627,646 | ) | (9,040,452 | ) | — | |||||||
| Net gain (loss) on investments and futures contracts | 330,068 | 212,811 | 3,511,947 | (11,922,070 | ) | — | |||||||||
| Net Increase (Decrease) in Net Assets Resulting from Operations | $ | 631,888 | $ | 2,615,628 | $ | 19,608,907 | $ | (9,635,776 | ) | $ | — | ||||
(a) Net of $546 foreign taxes withheld
| 186 | See notes to financial statements | 187 |
Statements of Operations
FIRST INVESTORS INCOME FUNDS
Six Months Ended March 31, 2017
| INTERNATIONAL | LIMITED | |||||||||||
| OPPORTUNITIES | INVESTMENT | DURATION HIGH | STRATEGIC | |||||||||
| BOND | GRADE | QUALITY BOND | INCOME | |||||||||
| Investment Income | ||||||||||||
| Interest | $ | 2,164,061 | (b) | $ | 11,105,867 | $ | 1,191,474 | $ | 25,738 | |||
| Dividends from affiliate (Note 2) | — | — | — | 2,834,627 | ||||||||
| Total income | 2,164,061 | 11,105,867 | 1,191,474 | 2,860,365 | ||||||||
| Expenses (Notes 1 and 3): | ||||||||||||
| Advisory fees | 443,019 | 1,913,039 | 426,265 | 38,046 | ||||||||
| Distribution plan expenses – Class A | 89,480 | 692,624 | 81,056 | 227,506 | ||||||||
| Distribution plan expenses – Class B | N/A | 13,545 | N/A | N/A | ||||||||
| Shareholder servicing costs – Class A | 58,572 | 337,742 | 36,903 | 97,578 | ||||||||
| Shareholder servicing costs – Class B | N/A | 4,025 | N/A | N/A | ||||||||
| Shareholder servicing costs – Advisor Class | 54,749 | 59,004 | 59,239 | 41 | ||||||||
| Shareholder servicing costs – Institutional Class | 756 | 4,836 | 3,825 | N/A | ||||||||
| Professional fees | 19,050 | 39,501 | 15,250 | 30,250 | ||||||||
| Custodian fees | 27,856 | 8,779 | 5,499 | 5,637 | ||||||||
| Registration fees | 33,000 | 57,501 | 27,500 | 21,750 | ||||||||
| Reports to shareholders | 7,007 | 13,063 | 8,456 | 5,039 | ||||||||
| Trustees’ fees | 3,334 | 16,337 | 3,491 | 4,222 | ||||||||
| Other expenses | 17,071 | 28,584 | 14,386 | 7,826 | ||||||||
| Total expenses | 753,894 | 3,188,580 | 681,870 | 437,895 | ||||||||
| Less: Expenses waived and/or assumed (Note 3) | — | (311,813 | ) | (131,690 | ) | — | ||||||
| Expenses paid indirectly (Note 1G) | (327 | ) | (2,877 | ) | (1,183 | ) | (1,571 | ) | ||||
| Net expenses | 753,567 | 2,873,890 | 548,997 | 436,324 | ||||||||
| Net investment income | 1,410,494 | 8,231,977 | 642,477 | 2,424,041 | ||||||||
| Realized and Unrealized Gain (Loss) on Investments, Affiliate, | ||||||||||||
| Futures Contracts and Foreign Currency Transactions (Notes 2 and 5): | ||||||||||||
| Net realized gain (loss) on: | ||||||||||||
| Investments | (971,194 | ) | (127,650 | ) | (98,453 | ) | (493 | ) | ||||
| Capital gain distribution from affiliate | — | — | — | 77,283 | ||||||||
| Affiliate | — | — | — | (218,162 | ) | |||||||
| Futures contracts | — | — | — | (67,146 | ) | |||||||
| Foreign currency transactions | (723,676 | ) | — | — | — | |||||||
| Net realized loss on investments, affiliate, futures contracts and foreign currency transactions | (1,694,870 | ) | (127,650 | ) | (98,453 | ) | (208,518 | ) | ||||
| Net unrealized appreciation (depreciation) on: | ||||||||||||
| Investments | (2,659,244 | ) | (19,002,159 | ) | (1,313,892 | ) | (839 | ) | ||||
| Affiliate | — | — | — | (688,055 | ) | |||||||
| Foreign currency transactions | 218,470 | — | — | — | ||||||||
| Net unrealized depreciation on investments, affiliate | ||||||||||||
| and foreign currency transactions | (2,440,774 | ) | (19,002,159 | ) | (1,313,892 | ) | (688,894 | ) | ||||
| Net loss on investments, affiliate, futures contracts and | ||||||||||||
| foreign currency transactions | (4,135,644 | ) | (19,129,809 | ) | (1,412,345 | ) | (897,412 | ) | ||||
| Net Increase (Decrease) in Net Assets Resulting from Operations | $ | (2,725,150 | ) | $ | (10,897,832 | ) | $ | (769,868 | ) | $ | 1,526,629 | |
(b) Net of $17,641 foreign taxes withheld.
| 188 | See notes to financial statements | 189 |
Statements of Operations
FIRST INVESTORS EQUITY FUNDS
Six Months Ended March 31, 2017
| HEDGED U.S. | ||||||||||||||||||
| COVERED CALL | EQUITY | GROWTH & | EQUITY | |||||||||||||||
| STRATEGY | INCOME | GLOBAL | INCOME | OPPORTUNITIES | INTERNATIONAL | |||||||||||||
| Investment Income | ||||||||||||||||||
| Dividends | $ | 1,815,837 | $ | 8,581,899 | (a) | $ | 3,459,818 | (b) | $ | 20,372,576 | (c) | $ | 413,345 | (d) | $ | 2,097,248 | (e) | |
| Interest | — | 54,921 | 26,241 | 32,748 | — | 14,103 | ||||||||||||
| Total income | 1,815,837 | 8,636,820 | 3,486,059 | 20,405,324 | 413,345 | 2,111,351 | ||||||||||||
| Expenses (Notes 1 and 3): | ||||||||||||||||||
| Advisory fees | 597,445 | 2,206,338 | 2,507,962 | 5,989,138 | 311,265 | 1,383,005 | ||||||||||||
| Distribution plan expenses – Class A | 121,854 | 804,994 | 509,648 | 2,387,672 | 34,029 | 292,185 | ||||||||||||
| Distribution plan expenses – Class B | N/A | 16,585 | 13,914 | 80,077 | N/A | 6,894 | ||||||||||||
| Shareholder servicing costs – Class A | 67,631 | 352,913 | 309,631 | 1,104,465 | 30,438 | 228,943 | ||||||||||||
| Shareholder servicing costs – Class B | N/A | 4,326 | 3,837 | 17,783 | N/A | 2,408 | ||||||||||||
| Shareholder servicing costs – Advisor Class | 38,071 | 19,976 | 61,445 | 51,289 | 8,096 | 52,282 | ||||||||||||
| Shareholder servicing costs – Institutional Class | 759 | 846 | 506 | 1,665 | 28 | 375 | ||||||||||||
| Professional fees | 22,801 | 30,462 | 26,925 | 77,150 | 15,166 | 18,900 | ||||||||||||
| Custodian fees | 7,722 | 13,246 | 51,644 | 21,239 | 6,000 | 29,333 | ||||||||||||
| Registration fees | 60,110 | 57,350 | 52,501 | 49,000 | 25,000 | 39,000 | ||||||||||||
| Reports to shareholders | 3,766 | 13,073 | 14,037 | 44,172 | 3,803 | 12,045 | ||||||||||||
| Trustees’ fees | 3,425 | 16,905 | 14,592 | 49,470 | 1,182 | 7,901 | ||||||||||||
| Other expenses | 69,175 | 29,118 | 51,725 | 76,132 | 37,438 | 25,754 | ||||||||||||
| Total expenses | 992,759 | 3,566,132 | 3,618,367 | 9,949,252 | 472,445 | 2,099,025 | ||||||||||||
| Less: Expenses waived and/or assumed (Note 3) | (126,546 | ) | — | (131,999 | ) | — | (47,586 | ) | — | |||||||||
| Expenses paid indirectly (Note 1G) | (185 | ) | (3,345 | ) | (1,235 | ) | (8,272 | ) | — | (1,083 | ) | |||||||
| Net expenses | 866,028 | 3,562,787 | 3,485,133 | 9,940,980 | 424,859 | 2,097,942 | ||||||||||||
| Net investment income (loss) | 949,809 | 5,074,033 | 926 | 10,464,344 | (11,514 | ) | 13,409 | |||||||||||
| Realized and Unrealized Gain (Loss) on Investments, Options and | ||||||||||||||||||
| Future Contracts and Foreign Currency Transactions (Notes 2 and 5): | ||||||||||||||||||
| Net realized gain (loss) on: | ||||||||||||||||||
| Investments | 2,191,115 | 10,752,224 | 27,330,454 | 45,507,384 | (141,596 | ) | 8,585,183 | |||||||||||
| Options contracts | (5,299,842 | ) | 114,605 | — | — | (1,540,799 | ) | — | ||||||||||
| Futures contracts | — | — | — | — | (2,958 | ) | — | |||||||||||
| Foreign currency transactions | — | — | (44,606 | ) | — | 485 | (240,142 | ) | ||||||||||
| Net realized gain (loss) on investments, options and futures contracts, and | ||||||||||||||||||
| foreign currency transactions | (3,108,727 | ) | 10,866,829 | 27,285,848 | 45,507,384 | (1,684,868 | ) | 8,345,041 | ||||||||||
| Net unrealized appreciation (depreciation) of: | ||||||||||||||||||
| Investments | 10,058,536 | 31,814,451 | 14,724,494 | 70,702,374 | 4,492,815 | (1,451,351 | ) | |||||||||||
| Options contracts | 1,223,480 | 2,510 | — | — | (96,806 | ) | — | |||||||||||
| Futures contracts | — | — | — | — | 67,290 | — | ||||||||||||
| Foreign currency transactions | — | — | 203,820 | — | (1,854 | ) | (15,440 | ) | ||||||||||
| Net unrealized appreciation (depreciation) on investments, options and futures | ||||||||||||||||||
| contracts, and foreign currency transactions | 11,282,016 | 31,816,961 | 14,928,314 | 70,702,374 | 4,461,445 | (1,466,791 | ) | |||||||||||
| Net gain on investments, options and futures contracts | ||||||||||||||||||
| and foreign currency transactions | 8,173,289 | 42,683,790 | 42,214,162 | 116,209,758 | 2,776,577 | 6,878,250 | ||||||||||||
| Net Increase in Net Assets Resulting from Operations. | $ | 9,123,098 | $ | 47,757,823 | $ | 42,215,088 | $ | 126,674,102 | $ | 2,765,063 | $ | 6,891,659 | ||||||
(a) Net of $26,085 foreign taxes withheld
(b) Net of $ 115,155 foreign taxes withheld
(c) Net of $31,531 foreign taxes withheld
(d) Net of $3,021 foreign taxes withheld
(e) Net of $ 159,389 foreign taxes withheld
| 190 | See notes to financial statements | 191 |
Statements of Operations
FIRST INVESTORS EQUITY FUNDS
Six Months Ended March 31, 2017
| REAL | SELECT | SPECIAL | TOTAL | |||||||||||||||
| LONG SHORT | OPPORTUNITY | ESTATE | GROWTH | SITUATIONS | RETURN | |||||||||||||
| Investment Income | ||||||||||||||||||
| Dividends | $ | 52,304 | (f) | $ | 7,596,944 | (g) | $ | 2,072,775 | $ | 2,965,441 | $ | 4,095,015 | $ | 6,156,864 | (h) | |||
| Interest | 1,458 | 73,568 | — | 10,066 | 18,574 | 4,531,638 | ||||||||||||
| Total income | 53,762 | 7,670,512 | 2,072,775 | 2,975,507 | 4,113,589 | 10,688,502 | ||||||||||||
| Expenses (Notes 1 and 3): | ||||||||||||||||||
| Advisory fees | 54,940 | 3,500,869 | 340,224 | 1,695,152 | 2,263,630 | 3,072,221 | ||||||||||||
| Distribution plan expenses – Class A | 1,879 | 1,345,969 | 48,899 | 568,882 | 737,470 | 1,264,015 | ||||||||||||
| Distribution plan expenses – Class B | N/A | 40,889 | N/A | 15,960 | 16,116 | 37,189 | ||||||||||||
| Shareholder servicing costs – Class A | 3,997 | 705,065 | 38,690 | 312,465 | 411,972 | 631,344 | ||||||||||||
| Shareholder servicing costs – Class B | N/A | 8,764 | N/A | 3,400 | 4,241 | 7,436 | ||||||||||||
| Shareholder servicing costs – Advisor Class | 3,997 | 63,984 | 45,713 | 17,717 | 53,441 | 295 | ||||||||||||
| Shareholder servicing costs – Institutional Class | 20 | 792 | 130 | 614 | 1,154 | 4,973 | ||||||||||||
| Professional fees | 8,995 | 46,936 | 16,599 | 24,516 | 27,389 | 43,863 | ||||||||||||
| Custodian fees | 2,500 | 15,296 | 5,741 | 9,258 | 21,195 | 20,153 | ||||||||||||
| Registration fees | 19,986 | 55,500 | 42,501 | 44,500 | 48,499 | 54,513 | ||||||||||||
| Reports to shareholders | 1,000 | 27,657 | 10,048 | 13,818 | 18,106 | 21,125 | ||||||||||||
| Trustees’ fees | 174 | 27,601 | 2,449 | 12,478 | 15,663 | 24,827 | ||||||||||||
| Divdend expense | 46,418 | — | — | — | — | — | ||||||||||||
| Other expenses | 4,997 | 45,654 | 9,694 | 19,864 | 26,994 | 51,840 | ||||||||||||
| Total expenses | 148,903 | 5,884,976 | 560,688 | 2,738,624 | 3,645,870 | 5,233,794 | ||||||||||||
| Less: Expenses (waived and/or assumed) repaid to adviser (Note 3) | (34,992 | ) | — | 2,328 | — | — | — | |||||||||||
| Expenses paid indirectly (Note 1G) | — | (5,316 | ) | (737 | ) | (1,298 | ) | (3,337 | ) | (5,297 | ) | |||||||
| Net expenses | 113,911 | 5,879,660 | 562,279 | 2,737,326 | 3,642,533 | 5,228,497 | ||||||||||||
| Net investment income (loss) | (60,149 | ) | 1,790,852 | 1,510,496 | 238,181 | 471,056 | 5,460,005 | |||||||||||
| Realized and Unrealized Gain (Loss) on Investments (Note 2): | ||||||||||||||||||
| Net realized gain (loss) on investments | (119,800 | ) | 29,980,322 | (338,340 | ) | 12,554,154 | 13,814,795 | 10,812,736 | ||||||||||
| Net unrealized appreciation (depreciation) of investments | 516,890 | 46,124,183 | (2,595,696 | ) | 31,369,697 | 42,805,054 | 15,503,162 | |||||||||||
| Net gain (loss) on investments | 397,090 | 76,104,505 | (2,934,036 | ) | 43,923,851 | 56,619,849 | 26,315,898 | |||||||||||
| Net Increase (Decrease) in Net Assets Resulting from Operations | $ | 336,941 | $ | 77,895,357 | $ | (1,423,540 | ) | $ | 44,162,032 | $ | 57,090,905 | $ | 31,775,903 | |||||
(f) Net of $105 foreign taxes withheld
(g) Net of $12,993 foreign taxes withheld
(h) Net of $9,837 foreign taxes withheld
| 192 | See notes to financial statements | 193 |
Statements of Changes in Net Assets
FIRST INVESTORS INCOME FUNDS
| FUND | ||||||||||||||||||||||||
| BALANCED INCOME | FLOATING RATE | FOR INCOME | GOVERNMENT | |||||||||||||||||||||
| 10/1/2016 to | 10/1/2015 to | 10/1/2016 to | 10/1/2015 to | 10/1/2016 to | 10/1/2015 to | 10/1/2016 to | 10/1/2015 to | |||||||||||||||||
| 3/31/2017 | 9/30/2016 | * | 3/31/2017 | 9/30/2016 | 3/31/2017 | 9/30/2016 | 3/31/2017 | 9/30/2016 | ||||||||||||||||
| Increase (Decrease) in Net Assets From Operations | ||||||||||||||||||||||||
| Net investment income | $ | 301,820 | $ | 269,808 | $ | 2,402,817 | $ | 3,778,705 | $ | 16,096,960 | $ | 32,248,704 | $ | 2,286,294 | $ | 4,891,623 | ||||||||
| Net realized gain (loss) on investments | ||||||||||||||||||||||||
| and futures contracts | 279,485 | 46,865 | 267,697 | (1,259,700 | ) | 8,139,593 | (26,419,006 | ) | (2,881,618 | ) | 1,505,888 | |||||||||||||
| Net unrealized appreciation (depreciation) of investments and | ||||||||||||||||||||||||
| futures contracts | 50,583 | 1,061,731 | (54,886 | ) | 2,509,338 | (4,627,646 | ) | 52,455,579 | (9,040,452 | ) | 1,038,417 | |||||||||||||
| Net increase (decrease) in net assets resulting | ||||||||||||||||||||||||
| from operations | 631,888 | 1,378,404 | 2,615,628 | 5,028,343 | 19,608,907 | 58,285,277 | (9,635,776 | ) | 7,435,928 | |||||||||||||||
| Distributions to Shareholders | ||||||||||||||||||||||||
| Net investment income – Class A | (409,469 | ) | (252,943 | ) | (1,036,639 | ) | (1,721,284 | ) | (13,685,648 | ) | (28,095,986 | ) | (2,193,714 | ) | (5,098,278 | ) | ||||||||
| Net investment income – Class B | N/A | N/A | N/A | N/A | (53,889 | ) | (122,232 | ) | (8,746 | ) | (25,367 | ) | ||||||||||||
| Net investment income – Advisor Class | (1,256 | ) | (1,621 | ) | (1,121,749 | ) | (1,732,407 | ) | (1,574,357 | ) | (2,868,632 | ) | (699,445 | ) | (1,234,888 | ) | ||||||||
| Net investment income – Institutional Class | (2,718 | ) | (2,135 | ) | (295,781 | ) | (397,164 | ) | (1,858,037 | ) | (2,837,180 | ) | (14,086 | ) | (345,265 | ) | ||||||||
| Net realized gains – Class A | (33,013 | ) | — | — | — | — | — | — | — | |||||||||||||||
| Net realized gains – Class B | N/A | N/A | N/A | N/A | — | — | — | — | ||||||||||||||||
| Net realized gains – Advisor Class | (95 | ) | — | — | — | — | — | — | — | |||||||||||||||
| Net realized gains – Institutional Class | (197 | ) | — | — | — | — | — | — | — | |||||||||||||||
| Total distributions | (446,748 | ) | (256,699 | ) | (2,454,169 | ) | (3,850,855 | ) | (17,171,931 | ) | (33,924,030 | ) | (2,915,991 | ) | (6,703,798 | ) | ||||||||
| Share Transactions | ||||||||||||||||||||||||
| Class A: | ||||||||||||||||||||||||
| Proceeds from shares sold | 15,092,751 | 29,666,925 | 11,700,271 | 13,988,494 | 25,612,123 | 44,844,582 | 18,473,688 | 37,665,852 | ||||||||||||||||
| Reinvestment of distributions | 433,748 | 249,169 | 991,707 | 1,656,758 | 11,829,958 | 24,326,941 | 2,081,684 | 4,827,126 | ||||||||||||||||
| Cost of shares redeemed | (1,627,184 | ) | (1,345,357 | ) | (8,348,598 | ) | (12,013,129 | ) | (44,310,720 | ) | (85,357,155 | ) | (28,562,703 | ) | (50,293,578 | ) | ||||||||
| 13,899,315 | 28,570,737 | 4,343,380 | 3,632,123 | (6,868,639 | ) | (16,185,632 | ) | (8,007,331 | ) | (7,800,600 | ) | |||||||||||||
| Class B: | ||||||||||||||||||||||||
| Proceeds from shares sold | N/A | N/A | N/A | N/A | 66,766 | 153,274 | 162,896 | 229,389 | ||||||||||||||||
| Reinvestment of dividends | N/A | N/A | N/A | N/A | 42,919 | 98,032 | 8,488 | 24,407 | ||||||||||||||||
| Cost of shares redeemed | N/A | N/A | N/A | N/A | (425,692 | ) | (808,011 | ) | (708,712 | ) | (712,548 | ) | ||||||||||||
| N/A | N/A | N/A | N/A | (316,007 | ) | (556,705 | ) | (537,328 | ) | (458,752 | ) | |||||||||||||
| Advisor Class: | ||||||||||||||||||||||||
| Proceeds from shares sold | — | 100,010 | 9,621,515 | 19,186,634 | 8,762,376 | 28,446,083 | 10,926,873 | 22,608,318 | ||||||||||||||||
| Reinvestment of distributions | 1,351 | 1,622 | 1,117,327 | 1,726,808 | 1,546,289 | 2,860,325 | 697,108 | 1,230,638 | ||||||||||||||||
| Cost of shares redeemed | — | — | (5,057,389 | ) | (9,702,326 | ) | (16,244,887 | ) | (7,394,038 | ) | (3,993,868 | ) | (9,845,019 | ) | ||||||||||
| 1,351 | 101,632 | 5,681,453 | 11,211,116 | (5,936,222 | ) | 23,912,370 | 7,630,113 | 13,993,937 | ||||||||||||||||
| Institutional Class: | ||||||||||||||||||||||||
| Proceeds from shares sold | 120,750 | 146,631 | 8,823,451 | 4,679,951 | 18,169,674 | 19,288,098 | 8,112,396 | 4,623,534 | ||||||||||||||||
| Reinvestment of distributions | 2,915 | 2,135 | 10,596 | 7,919 | 83,054 | 154,245 | 6,039 | 13,151 | ||||||||||||||||
| Cost of shares redeemed | (39,680 | ) | (1,398 | ) | (36,847 | ) | (3,845,745 | ) | (19,072,201 | ) | (10,511,393 | ) | (7,515,896 | ) | (10,762,966 | ) | ||||||||
| 83,985 | 147,368 | 8,797,200 | 842,125 | (819,473 | ) | 8,930,950 | 602,539 | (6,126,281 | ) | |||||||||||||||
| Net increase (decrease) from share transactions | 13,984,651 | 28,819,737 | 18,822,033 | 15,685,364 | (13,940,341 | ) | 16,100,983 | (312,007 | ) | (391,696 | ) | |||||||||||||
| Net increase (decrease) in net assets | 14,169,791 | 29,941,442 | 18,983,492 | 16,862,852 | (11,503,365 | ) | 40,462,230 | (12,863,774 | ) | 340,434 | ||||||||||||||
| Net Assets | ||||||||||||||||||||||||
| Beginning of period | 29,941,442 | — | 134,543,892 | 117,681,040 | 704,489,085 | 664,026,855 | 332,927,257 | 332,586,823 | ||||||||||||||||
| End of period† | $ | 44,111,233 | $ | 29,941,442 | $ | 153,527,384 | $ | 134,543,892 | $ | 692,985,720 | $ | 704,489,085 | $ | 320,063,483 | $ | 332,927,257 | ||||||||
| †Includes undistributed net investment income (deficit) of | $ | (88,410 | ) | $ | 23,213 | $ | (25,408 | ) | $ | 25,946 | $ | (3,821,216 | ) | $ | (2,746,245 | ) | $ | (627,086 | ) | $ | 2,611 | |||
* From October 1, 2015 (commencement of operations) to September 30, 2016.
| 194 | See notes to financial statements | 195 |
Statements of Changes in Net Assets
FIRST INVESTORS INCOME FUNDS
| FUND | |||||||||||||||||
| BALANCED INCOME | FLOATING RATE | FOR INCOME | GOVERNMENT | ||||||||||||||
| 10/1/2016 to | 10/1/2015 to | 10/1/2016 to | 10/1/2015 to | 10/1/2016 to | 10/1/2015 to | 10/1/2016 to | 10/1/2015 to | ||||||||||
| 3/31/2017 | 9/30/2016 | * | 3/31/2017 | 9/30/2016 | 3/31/2017 | 9/30/2016 | 3/31/2017 | 9/30/2016 | |||||||||
| Shares Issued and Redeemed | |||||||||||||||||
| Class A: | |||||||||||||||||
| Sold | 1,422,639 | 2,877,326 | 1,208,971 | 1,468,052 | 10,348,943 | 18,679,753 | 1,752,330 | 3,482,260 | |||||||||
| Issued for distributions reinvested | 40,865 | 23,750 | 102,469 | 173,895 | 4,773,626 | 10,132,558 | 198,237 | 446,507 | |||||||||
| Redeemed | (153,067 | ) | (128,384 | ) | (862,672 | ) | (1,258,018 | ) | (17,909,676 | ) | (35,594,874 | ) | (2,717,931 | ) | (4,653,033 | ) | |
| Net increase (decrease) in Class A shares outstanding | 1,310,437 | 2,772,692 | 448,768 | 383,929 | (2,787,107 | ) | (6,782,563 | ) | (767,364 | ) | (724,266 | ) | |||||
| Class B: | |||||||||||||||||
| Sold | N/A | N/A | N/A | N/A | 26,974 | 64,132 | 15,256 | 21,319 | |||||||||
| Issued for distributions reinvested | N/A | N/A | N/A | N/A | 17,322 | 40,884 | 810 | 2,263 | |||||||||
| Redeemed | N/A | N/A | N/A | N/A | (171,586 | ) | (339,786 | ) | (67,665 | ) | (65,981 | ) | |||||
| Net decrease in Class B shares outstanding | N/A | N/A | N/A | N/A | (127,290 | ) | (234,770 | ) | (51,599 | ) | (42,399 | ) | |||||
| Advisor Class: | |||||||||||||||||
| Sold | — | 10,001 | 994,348 | 2,011,796 | 3,543,483 | 11,961,264 | 1,036,696 | 2,086,604 | |||||||||
| Issued for distributions reinvested | 127 | 156 | 115,468 | 181,286 | 624,757 | 1,188,864 | 66,290 | 113,619 | |||||||||
| Redeemed | — | — | (522,623 | ) | (1,017,251 | ) | (6,656,690 | ) | (3,075,131 | ) | (379,788 | ) | (908,097 | ) | |||
| Net increase (decrease) in Advisor Class shares | |||||||||||||||||
| outstanding | 127 | 10,157 | 587,193 | 1,175,831 | (2,488,450 | ) | 10,074,997 | 723,198 | 1,292,126 | ||||||||
| Institutional Class: | |||||||||||||||||
| Sold | 11,344 | 14,537 | 912,783 | 496,651 | 7,372,065 | 7,917,239 | 773,663 | 427,044 | |||||||||
| Issued for distributions reinvested | 274 | 204 | 1,096 | 832 | 33,420 | 63,982 | 571 | 1,211 | |||||||||
| Redeemed | (3,704 | ) | (131 | ) | (3,800 | ) | (401,689 | ) | (7,681,270 | ) | (4,457,424 | ) | (692,105 | ) | (988,228 | ) | |
| Net increase (decrease) in Institutional Class shares | |||||||||||||||||
| outstanding | 7,914 | 14,610 | 910,079 | 95,794 | (275,785 | ) | 3,523,797 | 82,129 | (559,973 | ) | |||||||
*From October 1, 2015 (commencement of operations) to September 30, 2016.
| 196 | See notes to financial statements | 197 |
Statements of Changes in Net Assets
FIRST INVESTORS INCOME FUNDS
| GOVERNMENT | INTERNATIONAL | LIMITED DURATION | ||||||||||||||||||||||
| CASH MANAGEMENT | OPPORTUNITIES BOND | INVESTMENT GRADE | HIGH QUALITY BOND | |||||||||||||||||||||
| 10/1/2016 to | 10/1/2015 to | 10/1/2016 to | 10/1/2015 to | 10/1/2016 to | 10/1/2015 to | 10/1/2016 to | 10/1/2015 to | |||||||||||||||||
| 3/31/2017 | 9/30/2016 | 3/31/2017 | 9/30/2016 | 3/31/2017 | 9/30/2016 | 3/31/2017 | 9/30/2016 | |||||||||||||||||
| Increase (Decrease) in Net Assets From Operations | ||||||||||||||||||||||||
| Net investment income (loss) | $ | — | $ | — | $ | 1,410,494 | $ | 3,193,580 | $ | 8,231,977 | $ | 15,869,016 | $ | 642,477 | $ | (38,935 | ) | |||||||
| Net realized gain (loss) on investments and foreign currency | ||||||||||||||||||||||||
| transations | — | — | (1,694,870 | ) | (1,947,020 | ) | (127,650 | ) | 1,076,502 | (98,453 | ) | 1,040,722 | ||||||||||||
| Net unrealized appreciation (depreciation) of investments and | ||||||||||||||||||||||||
| foreign currency transactions | — | — | (2,440,774 | ) | 9,375,479 | (19,002,159 | ) | 19,080,145 | (1,313,892 | ) | 554,240 | |||||||||||||
| Net increase (decrease) in net assets resulting from | ||||||||||||||||||||||||
| operations | — | — | (2,725,150 | ) | 10,622,039 | (10,897,832 | ) | 36,025,663 | (769,868 | ) | 1,556,027 | |||||||||||||
| Dividends to Shareholders | ||||||||||||||||||||||||
| Net investment income – Class A | — | — | — | (989,781 | ) | (7,959,856 | ) | (17,167,268 | ) | (615,410 | ) | (832,049 | ) | |||||||||||
| Net investment income – Class B | — | — | N/A | N/A | (32,450 | ) | (89,798 | ) | N/A | N/A | ||||||||||||||
| Net investment income – Advisor Class | N/A | N/A | — | (838,724 | ) | (1,601,964 | ) | (2,761,769 | ) | (679,510 | ) | (1,167,608 | ) | |||||||||||
| Net investment income – Institutional Class | — | — | — | (195,704 | ) | (596,933 | ) | (855,941 | ) | (305,547 | ) | (476,781 | ) | |||||||||||
| Total dividends | — | — | — | (2,024,209 | ) | (10,191,203 | ) | (20,874,776 | ) | (1,600,467 | ) | (2,476,438 | ) | |||||||||||
| Share Transactions | ||||||||||||||||||||||||
| Class A: | ||||||||||||||||||||||||
| Proceeds from shares sold | 127,261,488 | 220,000,674 | 3,258,176 | 6,401,813 | 35,857,215 | 72,485,945 | 18,365,374 | 29,155,089 | ||||||||||||||||
| Reinvestment of dividends | — | — | — | 949,631 | 7,449,819 | 16,052,698 | 600,828 | 809,386 | ||||||||||||||||
| Cost of shares redeemed | (117,868,696 | ) | (207,529,163 | ) | (7,959,883 | ) | (15,650,271 | ) | (41,261,751 | ) | (82,482,076 | ) | (7,140,404 | ) | (8,134,265 | ) | ||||||||
| 9,392,792 | 12,471,511 | (4,701,707 | ) | (8,298,827 | ) | 2,045,283 | 6,056,567 | 11,825,798 | 21,830,210 | |||||||||||||||
| Class B: | ||||||||||||||||||||||||
| Proceeds from shares sold | 212,476 | 508,240 | N/A | N/A | 308,248 | 415,040 | N/A | N/A | ||||||||||||||||
| Reinvestment of dividends | — | — | N/A | N/A | 31,159 | 86,756 | N/A | N/A | ||||||||||||||||
| Cost of shares redeemed | (227,697 | ) | (547,558 | ) | N/A | N/A | (625,335 | ) | (1,299,936 | ) | N/A | N/A | ||||||||||||
| (15,221 | ) | (39,318 | ) | N/A | N/A | (285,928 | ) | (798,140 | ) | N/A | N/A | |||||||||||||
| Advisor Class: | ||||||||||||||||||||||||
| Proceeds from shares sold | N/A | N/A | 11,243,392 | 20,843,533 | 15,206,140 | 31,066,280 | 8,338,563 | 17,582,400 | ||||||||||||||||
| Reinvestment of dividends | N/A | N/A | — | 836,307 | 1,597,026 | 2,752,476 | 675,755 | 1,160,847 | ||||||||||||||||
| Cost of shares redeemed | N/A | N/A | (1,941,383 | ) | (25,621,311 | ) | (5,075,527 | ) | (15,965,377 | ) | (3,535,939 | ) | (8,132,877 | ) | ||||||||||
| N/A | N/A | 9,302,009 | (3,941,471 | ) | 11,727,639 | 17,853,379 | 5,478,379 | 10,610,370 | ||||||||||||||||
| Institutional Class: | ||||||||||||||||||||||||
| Proceeds from shares sold | 622,986 | 1,575,243 | 4,498,150 | 773,078 | 2,006,951 | 19,457,559 | 1,545,204 | 18,700,486 | ||||||||||||||||
| Reinvestment of dividends | — | — | — | 8,650 | 33,532 | 69,861 | 2,726 | 3,113 | ||||||||||||||||
| Cost of shares redeemed | (602,547 | ) | (997,942 | ) | (3,975,488 | ) | (12,047,796 | ) | (2,764,498 | ) | (3,784,887 | ) | (33,265 | ) | (3,041,711 | ) | ||||||||
| 20,439 | 577,301 | 522,662 | (11,266,068 | ) | (724,015 | ) | 15,742,533 | 1,514,665 | 15,661,888 | |||||||||||||||
| Net increase (decrease) from share transactions | 9,398,010 | 13,009,494 | 5,122,964 | (23,506,366 | ) | 12,762,979 | 38,854,339 | 18,818,842 | 48,102,468 | |||||||||||||||
| Net increase (decrease) in net assets | 9,398,010 | 13,009,494 | 2,397,814 | (14,908,536 | ) | (8,326,056 | ) | 54,005,226 | 16,448,507 | 47,182,057 | ||||||||||||||
| Net Assets | ||||||||||||||||||||||||
| Beginning of period | 125,129,323 | 112,119,829 | 124,494,090 | 139,402,626 | 594,971,073 | 540,965,847 | 121,283,336 | 74,101,279 | ||||||||||||||||
| End of period† | $ | 134,527,333 | $ | 125,129,323 | $ | 126,891,904 | $ | 124,494,090 | $ | 586,645,017 | $ | 594,971,073 | $ | 137,731,843 | $ | 121,283,336 | ||||||||
| †Includes undistributed net investment income (deficit) of | $ | — | $ | — | $ | 182,846 | $ | (1,227,648 | ) | $ | (15,451,697 | ) | $ | (13,492,471 | ) | $ | (2,718,659 | ) | $ | (1,760,669 | ) | |||
| 198 | See notes to financial statements | 199 |
Statements of Changes in Net Assets
FIRST INVESTORS INCOME FUNDS
| GOVERNMENT | INTERNATIONAL | LIMITED DURATION | |||||||||||||||
| CASH MANAGEMENT | OPPORTUNITIES BOND | INVESTMENT GRADE | HIGH QUALITY BOND | ||||||||||||||
| 10/1/2016 to | 10/1/2015 to | 10/1/2016 to | 10/1/2015 to | 10/1/2016 to | 10/1/2015 to | 10/1/2016 to | 10/1/2015 to | ||||||||||
| 3/31/2017 | 9/30/2016 | 3/31/2017 | 9/30/2016 | 3/31/2017 | 9/30/2016 | 3/31/2017 | 9/30/2016 | ||||||||||
| Shares Issued and Redeemed | |||||||||||||||||
| Class A: | |||||||||||||||||
| Sold | 127,261,488 | 220,000,674 | 371,632 | 722,896 | 3,730,234 | 7,462,492 | 1,925,942 | 3,007,505 | |||||||||
| Issued for dividends reinvested | — | — | — | 110,382 | 775,832 | 1,653,812 | 63,143 | 83,518 | |||||||||
| Redeemed | (117,868,696 | ) | (207,529,163 | ) | (906,293 | ) | (1,771,836 | ) | (4,295,651 | ) | (8,501,494 | ) | (750,404 | ) | (838,923 | ) | |
| Net increase (decrease) in Class A shares outstanding | 9,392,792 | 12,471,511 | (534,661 | ) | (938,558 | ) | 210,415 | 614,810 | 1,238,681 | 2,252,100 | |||||||
| Class B: | |||||||||||||||||
| Sold | 212,477 | 508,240 | N/A | N/A | 31,976 | 43,568 | N/A | N/A | |||||||||
| Issued for dividends reinvested | — | — | N/A | N/A | 3,266 | 9,020 | N/A | N/A | |||||||||
| Redeemed | (227,697 | ) | (547,558 | ) | N/A | N/A | (65,400 | ) | (135,398 | ) | N/A | N/A | |||||
| Net decrease in Class B shares outstanding | (15,220 | ) | (39,318 | ) | N/A | N/A | (30,158 | ) | (82,810 | ) | N/A | N/A | |||||
| Advisor Class: | |||||||||||||||||
| Sold | N/A | N/A | 1,278,409 | 2,351,297 | 1,573,879 | 3,183,454 | 872,403 | 1,807,222 | |||||||||
| Issued for dividends reinvested | N/A | N/A | — | 96,941 | 165,545 | 282,150 | 70,783 | 119,401 | |||||||||
| Redeemed | N/A | N/A | (220,355 | ) | (2,853,135 | ) | (526,591 | ) | (1,633,088 | ) | (369,920 | ) | (835,583 | ) | |||
| Net increase (decrease) in Advisor Class shares | |||||||||||||||||
| outstanding | N/A | N/A | 1,058,054 | (404,897 | ) | 1,212,833 | 1,832,516 | 573,266 | 1,091,040 | ||||||||
| Institutional Class: | |||||||||||||||||
| Sold | 622,985 | 1,575,243 | 500,314 | 87,003 | 208,605 | 1,984,468 | 161,688 | 1,922,294 | |||||||||
| Issued for dividends reinvested | — | — | — | 1,000 | 3,484 | 7,178 | 285 | 320 | |||||||||
| Redeemed | (602,547 | ) | (997,942 | ) | (450,320 | ) | (1,397,456 | ) | (288,823 | ) | (383,038 | ) | (3,485 | ) | (312,617 | ) | |
| Net increase (decrease) in Institutional Class shares | |||||||||||||||||
| outstanding | 20,438 | 577,301 | 49,994 | (1,309,453 | ) | (76,734 | ) | 1,608,608 | 158,488 | 1,609,997 | |||||||
| 200 | See notes to financial statements | 201 |
Statements of Changes in Net Assets
FIRST INVESTORS INCOME FUNDS
| STRATEGIC INCOME | ||||||
| 10/1/2016to | 10/1/2015to | |||||
| 3/31/2017 | 9/30/2016 | |||||
| Increase (Decrease) in Net Assets From Operations | ||||||
| Net investment income | $ | 2,424,041 | $ | 4,461,910 | ||
| Net realized loss on investments, affiliate and | ||||||
| futures contracts (Note 2) | (285,801 | ) | (2,090,537 | ) | ||
| Capital gain distributions from affiliate (Note 2) | 77,283 | 245,434 | ||||
| Net unrealized appreciation (depreciation) of investments | ||||||
| and affiliate (Note 2) | (688,894 | ) | 5,220,510 | |||
| Net increase in net assets resulting from operations | 1,526,629 | 7,837,317 | ||||
| Distributions to Shareholders | ||||||
| Net investment income – Class A | (2,145,718 | ) | (4,718,986 | ) | ||
| Net investment income – Class B | N/A | N/A | ||||
| Net investment income – Advisor Class | (8,453 | ) | (13,306 | ) | ||
| Net investment income – Institutional Class | N/A | N/A | ||||
| Net realized gains – Class A | — | (253,425 | ) | |||
| Net realized gains – Class B | N/A | N/A | ||||
| Net realized gains – Advisor Class | — | (571 | ) | |||
| Net realized gains – Institutional Class | N/A | N/A | ||||
| Total distributions | (2,154,171 | ) | (4,986,288 | ) | ||
| Share Transactions | ||||||
| Class A: | ||||||
| Proceeds from shares sold | 20,630,591 | 32,016,312 | ||||
| Reinvestment of distributions | 2,056,345 | 4,778,695 | ||||
| Cost of shares redeemed | (13,069,713 | ) | (22,181,166 | ) | ||
| 9,617,223 | 14,613,841 | |||||
| Class B: | ||||||
| Proceeds from shares sold | N/A | N/A | ||||
| Reinvestment of distributions | N/A | N/A | ||||
| Cost of shares redeemed | N/A | N/A | ||||
| N/A | N/A | |||||
| Advisor Class: | ||||||
| Proceeds from shares sold | 380,152 | 165,581 | ||||
| Reinvestment of distributions | 6,827 | 13,877 | ||||
| Cost of shares redeemed | (105,668 | ) | (78,602 | ) | ||
| 281,311 | 100,856 | |||||
| Institutional Class: | ||||||
| Proceeds from shares sold | N/A | N/A | ||||
| Reinvestment of distributions | N/A | N/A | ||||
| Cost of shares redeemed | N/A | N/A | ||||
| N/A | N/A | |||||
| Net increase from share transactions | 9,898,534 | 14,714,697 | ||||
| Net increase in net assets | 9,270,992 | 17,565,726 | ||||
| Net Assets | ||||||
| Beginning of period | 149,605,024 | 132,039,298 | ||||
| End of period† | $ | 158,876,016 | $ | 149,605,024 | ||
| †Includes undistributed net investment income of | $ | 316,656 | $ | 46,786 | ||
| 202 |
| STRATEGIC INCOME | |||||
| 10/1/2016 to | 10/1/2015 to | ||||
| 3/31/2017 | 9/30/2016 | ||||
| Shares Issued and Redeemed | |||||
| Class A: | |||||
| Sold | 2,193,479 | 3,429,263 | |||
| Issued for distributions reinvested | 218,555 | 513,348 | |||
| Redeemed | (1,389,014 | ) | (2,380,044 | ) | |
| Net increase in Class A shares outstanding | 1,023,020 | 1,562,567 | |||
| Class B: | |||||
| Sold | N/A | N/A | |||
| Issued for distributions reinvested | N/A | N/A | |||
| Redeemed | N/A | N/A | |||
| Net increase in Class B shares outstanding | N/A | N/A | |||
| Advisor Class: | |||||
| Sold | 40,551 | 17,852 | |||
| Issued for distributions reinvested | 727 | 1,492 | |||
| Redeemed | (11,272 | ) | (8,463 | ) | |
| Net increase in Advisor Class shares outstanding | 30,006 | 10,881 | |||
| Institutional Class: | |||||
| Sold | N/A | N/A | |||
| Issued for distributions reinvested | N/A | N/A | |||
| Redeemed | N/A | N/A | |||
| Net increase in Institutional Class shares outstanding | N/A | N/A | |||
| See notes to financial statements | 203 |
Statements of Changes in Net Assets
FIRST INVESTORS EQUITY FUNDS
| COVERED CALL | ||||||||||||||||||||||||
| STRATEGY | EQUITY INCOME | GLOBAL | GROWTH & INCOME | |||||||||||||||||||||
| 10/1/2016 to | 4/1/2016 to | 10/1/2016 to | 10/1/2015 to | 10/1/2016 to | 10/1/2015 to | 10/1/2016 to | 10/1/2015 to | |||||||||||||||||
| 3/31/2017 | 9/30/2016 | * | 3/31/2017 | 9/30/2016 | 3/31/2017 | 9/30/2016 | 3/31/2017 | 9/30/2016 | ||||||||||||||||
| Increase (Decrease) in Net Assets From Operations | ||||||||||||||||||||||||
| Net investment income | $ | 949,809 | $ | 391,730 | $ | 5,074,033 | $ | 10,005,109 | $ | 926 | $ | 1,025,873 | $ | 10,464,344 | $ | 22,490,759 | ||||||||
| Net realized gain (loss) on investments, options contracts | ||||||||||||||||||||||||
| and foreign currency transactions | (3,108,727 | ) | (265,660 | ) | 10,866,829 | 10,909,617 | 27,285,848 | (22,092,772 | ) | 45,507,384 | 56,987,271 | |||||||||||||
| Net unrealized appreciation of investments, options contracts | ||||||||||||||||||||||||
| and foreign currency transactions | 11,282,016 | 1,954,066 | 31,816,961 | 54,327,047 | 14,928,314 | 50,367,989 | 70,702,374 | 110,786,808 | ||||||||||||||||
| Net increase in net assets resulting | ||||||||||||||||||||||||
| from operations | 9,123,098 | 2,080,136 | 47,757,823 | 75,241,773 | 42,215,088 | 29,301,090 | 126,674,102 | 190,264,838 | ||||||||||||||||
| Distributions to Shareholders | ||||||||||||||||||||||||
| Net investment income – Class A | (439,121 | ) | (122,166 | ) | (5,076,328 | ) | (8,682,440 | ) | (511,315 | ) | (128,304 | ) | (15,199,982 | ) | (17,472,549 | ) | ||||||||
| Net investment income – Class B | N/A | N/A | (19,057 | ) | (33,687 | ) | (608 | ) | — | (106,278 | ) | (74,135 | ) | |||||||||||
| Net investment income – Advisor Class | (446,348 | ) | (229,075 | ) | (673,650 | ) | (969,565 | ) | (438,669 | ) | (177,083 | ) | (1,529,286 | ) | (2,011,454 | ) | ||||||||
| Net investment income – Institutional Class | (43,240 | ) | (26,358 | ) | (52,232 | ) | (109,638 | ) | (8,341 | ) | (4,497 | ) | (115,972 | ) | (141,364 | ) | ||||||||
| Net realized gains – Class A | (139,400 | ) | — | (9,458,693 | ) | (19,115,339 | ) | — | (18,139,773 | ) | (54,318,955 | ) | (68,462,248 | ) | ||||||||||
| Net realized gains – Class B | N/A | N/A | (60,661 | ) | (145,747 | ) | — | (220,201 | ) | (594,347 | ) | (899,318 | ) | |||||||||||
| Net realized gains – Advisor Class | (90,537 | ) | — | (1,034,281 | ) | (1,660,873 | ) | — | (6,790,693 | ) | (4,880,138 | ) | (6,915,132 | ) | ||||||||||
| Net realized gains – Institutional Class | (7,569 | ) | — | (114,200 | ) | (325,937 | ) | — | (159,100 | ) | (354,035 | ) | (430,015 | ) | ||||||||||
| Total distributions | (1,166,215 | ) | (377,599 | ) | (16,489,102 | ) | (31,043,226 | ) | (958,933 | ) | (25,619,651 | ) | (77,098,993 | ) | (96,406,215 | ) | ||||||||
| Share Transactions | ||||||||||||||||||||||||
| Class A: | ||||||||||||||||||||||||
| Proceeds from shares sold | 72,815,384 | 48,782,331 | 33,045,979 | 61,467,757 | 14,852,857 | 35,052,068 | 71,213,615 | 151,969,755 | ||||||||||||||||
| Reinvestment of distributions | 571,834 | 120,752 | 14,348,740 | 27,486,375 | 503,983 | 18,063,683 | 68,974,592 | 85,343,880 | ||||||||||||||||
| Cost of shares redeemed | (3,975,621 | ) | (982,520 | ) | (52,114,880 | ) | (84,852,696 | ) | (26,642,013 | ) | (45,984,668 | ) | (140,519,645 | ) | (231,283,130 | ) | ||||||||
| 69,411,597 | 47,920,563 | (4,720,161 | ) | 4,101,436 | (11,285,173 | ) | 7,131,083 | (331,438 | ) | 6,030,505 | ||||||||||||||
| Class B: | ||||||||||||||||||||||||
| Proceeds from shares sold | N/A | N/A | 227,445 | 242,709 | 141,562 | 239,411 | 644,305 | 1,453,400 | ||||||||||||||||
| Reinvestment of distributions | N/A | N/A | 79,572 | 179,411 | 608 | 220,201 | 698,021 | 971,884 | ||||||||||||||||
| Cost of shares redeemed | N/A | N/A | (711,985 | ) | (1,092,424 | ) | (526,290 | ) | (864,944 | ) | (3,240,369 | ) | (5,559,988 | ) | ||||||||||
| N/A | N/A | (404,968 | ) | (670,304 | ) | (384,120 | ) | (405,332 | ) | (1,898,043 | ) | (3,134,704 | ) | |||||||||||
| Advisor Class: | ||||||||||||||||||||||||
| Proceeds from shares sold | 31,230,902 | 48,595,028 | 10,896,887 | 20,703,026 | 28,705,921 | 58,533,768 | 25,567,651 | 60,847,247 | ||||||||||||||||
| Reinvestment of distributions | 513,525 | 228,031 | 1,695,022 | 2,609,004 | 436,620 | 6,964,959 | 6,373,712 | 8,881,725 | ||||||||||||||||
| Cost of shares redeemed | (5,332,542 | ) | (10,671,187 | ) | (4,714,902 | ) | (10,774,411 | ) | (11,348,725 | ) | (13,225,742 | ) | (12,885,074 | ) | (85,290,088 | ) | ||||||||
| 26,411,885 | 38,151,872 | 7,877,007 | 12,537,619 | 17,793,816 | 52,272,985 | 19,056,289 | (15,561,116 | ) | ||||||||||||||||
| Institutional Class: | ||||||||||||||||||||||||
| Proceeds from shares sold | 2,072,572 | 4,081,405 | 4,686,787 | 3,761,509 | 252,627 | 328,204 | 536,869 | 942,301 | ||||||||||||||||
| Reinvestment of distributions | 10,808 | 2,023 | 69,051 | 273,351 | 8,341 | 163,598 | 470,007 | 571,379 | ||||||||||||||||
| Cost of shares redeemed | (167,234 | ) | (1,048 | ) | (5,376,667 | ) | (11,837,447 | ) | (351,957 | ) | (201,119 | ) | (1,326,219 | ) | (882,614 | ) | ||||||||
| 1,916,146 | 4,082,380 | (620,829 | ) | (7,802,587 | ) | (90,989 | ) | 290,683 | (319,343 | ) | 631,066 | |||||||||||||
| Net increase (decrease) from share transactions | 97,739,628 | 90,154,815 | 2,131,049 | 8,166,164 | 6,033,534 | 59,289,419 | 16,507,465 | (12,034,249 | ) | |||||||||||||||
| Net increase in net assets | 105,696,511 | 91,857,352 | 33,399,770 | 52,364,711 | 47,289,689 | 62,970,858 | 66,082,574 | 81,824,374 | ||||||||||||||||
| Net Assets | ||||||||||||||||||||||||
| Beginning of period | 91,857,352 | — | 589,808,329 | 537,443,618 | 515,268,989 | 452,298,131 | 1,748,552,554 | 1,666,728,180 | ||||||||||||||||
| End of period† | $ | 197,553,863 | $ | 91,857,352 | $ | 623,208,099 | $ | 589,808,329 | $ | 562,558,678 | $ | 515,268,989 | $ | 1,814,635,128 | $ | 1,748,552,554 | ||||||||
| †Includes undistributed net investment income of | $ | 35,231 | $ | 14,131 | $ | 1,909,844 | $ | 2,657,078 | $ | 916 | $ | 958,923 | $ | 7,079,982 | $ | 13,567,156 | ||||||||
* From April 1, 2016 (commencement of operations) to September 30, 2016.
| 204 | See notes to financial statements | 205 |
Statements of Changes in Net Assets
FIRST INVESTORS EQUITY FUNDS
| COVERED CALL | ||||||||||||||||
| STRATEGY | EQUITY INCOME | GLOBAL | GROWTH & INCOME | |||||||||||||
| 10/1/2016 to | 4/1/2016 to | 10/1/2016 to | 10/1/2015 to | 10/1/2016 to | 10/1/2015 to | 10/1/2016 to | 10/1/2015 to | |||||||||
| 3/31/2017 | 9/30/2016 | * | 3/31/2017 | 9/30/2016 | 3/31/2017 | 9/30/2016 | 3/31/2017 | 9/30/2016 | ||||||||
| Shares Issued and Redeemed | ||||||||||||||||
| Class A: | ||||||||||||||||
| Sold | 6,890,928 | 4,767,539 | 3,300,335 | 6,555,770 | 1,991,688 | 4,915,279 | 3,282,539 | 7,381,569 | ||||||||
| Issued for distributions reinvested | 53,371 | 11,707 | 1,435,897 | 2,962,868 | 68,944 | 2,460,992 | 3,233,323 | 4,133,027 | ||||||||
| Redeemed | (373,092 | ) | (95,242 | ) | (5,229,181 | ) | (9,037,443 | ) | (3,573,953 | ) | (6,463,775 | ) | (6,493,196 | ) | (11,210,394 | ) |
| Net increase (decrease) in Class A shares outstanding | 6,571,207 | 4,684,004 | (492,949 | ) | 481,195 | (1,513,321 | ) | 912,496 | 22,666 | 304,202 | ||||||
| Class B: | ||||||||||||||||
| Sold | N/A | N/A | 23,240 | 26,441 | 23,975 | 41,598 | 32,063 | 76,305 | ||||||||
| Issued for distributions reinvested | N/A | N/A | 8,147 | 19,752 | 104 | 37,322 | 35,415 | 50,645 | ||||||||
| Redeemed | N/A | N/A | (72,660 | ) | (120,318 | ) | (88,474 | ) | (150,696 | ) | (161,707 | ) | (291,680 | ) | ||
| Net decrease in Class B shares outstanding | N/A | N/A | (41,273 | ) | (74,125 | ) | (64,395 | ) | (71,776 | ) | (94,229 | ) | (164,730 | ) | ||
| Advisor Class | ||||||||||||||||
| Sold | 2,971,207 | 4,818,883 | 1,083,666 | 2,188,222 | 3,782,173 | 8,092,269 | 1,164,785 | 2,931,409 | ||||||||
| Issued for distributions reinvested | 48,074 | 22,348 | 169,159 | 280,602 | 58,764 | 936,150 | 296,287 | 427,659 | ||||||||
| Redeemed | (501,510 | ) | (1,056,567 | ) | (468,801 | ) | (1,138,072 | ) | (1,479,987 | ) | (1,838,151 | ) | (586,206 | ) | (4,145,892 | ) |
| Net increase (decrease) in Advisor Class shares outstanding | 2,517,771 | 3,784,664 | 784,024 | 1,330,752 | 2,360,950 | 7,190,268 | 874,866 | (786,824 | ) | |||||||
| Institutional Class: | ||||||||||||||||
| Sold | 194,145 | 407,074 | 488,858 | 391,950 | 32,610 | 46,001 | 24,694 | 46,308 | ||||||||
| Issued for distributions reinvested | 1,007 | 196 | 6,866 | 29,340 | 1,117 | 21,901 | 21,942 | 27,620 | ||||||||
| Redeemed | (15,744 | ) | (100 | ) | (524,052 | ) | (1,251,685 | ) | (45,846 | ) | (27,423 | ) | (61,089 | ) | (42,961 | ) |
| Net increase (decrease) in Institutional Class shares | ||||||||||||||||
| outstanding | 179,408 | 407,170 | (28,328 | ) | (830,395 | ) | (12,119 | ) | 40,479 | (14,453 | ) | 30,967 | ||||
*From April 1, 2016 (commencement of operations) to September 30, 2016.
| 206 | See notes to financial statements | 207 |
Statements of Changes in Net Assets
FIRST INVESTORS EQUITY FUNDS
| HEDGED U.S. EQUITY | |||||||||||||||||||||
| OPPORTUNITIES | INTERNATIONAL | LONG SHORT | OPPORTUNITY | ||||||||||||||||||
| 10/1/2016 to | 8/1/2016 to | 10/1/2016 to | 10/1/2015 to | 12/1/2016 to | 10/1/2016 to | 10/1/2015 to | |||||||||||||||
| 3/31/2017 | 9/30/2016 | * | 3/31/2017 | 9/30/2016 | 3/31/2017 | ** | 3/31/2017 | 9/30/2016 | |||||||||||||
| Increase (Decrease) in Net Assets From Operations | |||||||||||||||||||||
| Net investment income (loss) | $ | (11,514 | ) | $ | 6,571 | $ | 13,409 | $ | 1,529,442 | $ | (60,149 | ) | $ | 1,790,852 | $ | 5,121,358 | |||||
| Net realized gain (loss) on investments, options and futures | |||||||||||||||||||||
| contracts, and foreign currency transactions | (1,684,868 | ) | (7,443 | ) | 8,345,041 | (2,746,531 | ) | (119,800 | ) | 29,980,322 | 34,586,627 | ||||||||||
| Net unrealized appreciation (depreciation) of investments, | |||||||||||||||||||||
| options and futures contracts, and foreign currency | |||||||||||||||||||||
| transactions | 4,461,445 | (29,209 | ) | (1,466,791 | ) | 24,791,949 | 516,890 | 46,124,183 | 26,978,713 | ||||||||||||
| Net increase (decrease) in net assets resulting from | |||||||||||||||||||||
| operations | 2,765,063 | (30,081 | ) | 6,891,659 | 23,574,860 | 336,941 | 77,895,357 | 66,686,698 | |||||||||||||
| Distributions to Shareholders | |||||||||||||||||||||
| Net investment income – Class A | — | — | (1,018,350 | ) | (811,325 | ) | — | (5,116,339 | ) | (932,093 | ) | ||||||||||
| Net investment income – Class B | N/A | N/A | (5,219 | ) | (4,061 | ) | — | (47,551 | ) | — | |||||||||||
| Net investment income – Advisor Class | (6,858 | ) | — | (498,093 | ) | (315,211 | ) | — | (497,612 | ) | (93,491 | ) | |||||||||
| Net investment income – Institutional Class | (21 | ) | — | (15,915 | ) | (12,370 | ) | — | (34,340 | ) | (9,572 | ) | |||||||||
| Net realized gains – Class A | — | — | — | — | — | (31,438,505 | ) | (69,557,929 | ) | ||||||||||||
| Net realized gains – Class B | N/A | N/A | — | — | — | (364,203 | ) | (945,973 | ) | ||||||||||||
| Net realized gains – Advisor Class | — | — | — | — | — | (2,762,934 | ) | (4,434,485 | ) | ||||||||||||
| Net realized gains – Institutional Class | — | — | — | — | — | (178,958 | ) | (363,565 | ) | ||||||||||||
| Total distributions | (6,879 | ) | — | (1,537,577 | ) | (1,142,967 | ) | — | (40,440,442 | ) | (76,337,108 | ) | |||||||||
| Share Transactions | |||||||||||||||||||||
| Class A: | |||||||||||||||||||||
| Proceeds from shares sold | 24,951,923 | 9,273,891 | 13,728,970 | 28,098,007 | 4,875,122 | 60,734,131 | 124,866,504 | ||||||||||||||
| Reinvestment of distributions | — | — | 1,009,767 | 804,813 | — | 36,264,898 | 69,999,981 | ||||||||||||||
| Cost of shares redeemed | (946,773 | ) | (10,686 | ) | (18,794,261 | ) | (31,080,873 | ) | (30,586 | ) | (77,781,480 | ) | (124,056,665 | ) | |||||||
| 24,005,150 | 9,263,205 | (4,055,524 | ) | (2,178,053 | ) | 4,844,536 | 19,217,549 | 70,809,820 | |||||||||||||
| Class B: | |||||||||||||||||||||
| Proceeds from shares sold | N/A | N/A | 73,100 | 132,109 | N/A | 374,102 | 788,145 | ||||||||||||||
| Reinvestment of distributions | N/A | N/A | 5,219 | 4,038 | N/A | 407,984 | 940,954 | ||||||||||||||
| Cost of shares redeemed | N/A | N/A | (307,183 | ) | (760,543 | ) | N/A | (1,654,832 | ) | (2,435,194 | ) | ||||||||||
| N/A | N/A | (228,864 | ) | (624,396 | ) | N/A | (872,746 | ) | (706,095 | ) | |||||||||||
| Advisor Class: | |||||||||||||||||||||
| Proceeds from shares sold | 9,229,930 | 24,590,674 | 15,782,740 | 27,538,775 | 9,400,010 | 15,217,273 | 33,137,811 | ||||||||||||||
| Reinvestment of distributions | 6,857 | — | 494,244 | 314,171 | — | 3,240,840 | 4,476,994 | ||||||||||||||
| Cost of shares redeemed | (1,168,137 | ) | (20,518 | ) | (3,873,124 | ) | (9,640,858 | ) | — | (6,572,099 | ) | (12,691,626 | ) | ||||||||
| 8,068,650 | 24,570,156 | 12,403,860 | 18,212,088 | 9,400,010 | 11,886,014 | 24,923,179 | |||||||||||||||
| Institutional Class: | |||||||||||||||||||||
| Proceeds from shares sold | 266,262 | 100,010 | 315,026 | 368,590 | 100,010 | 492,810 | 1,029,771 | ||||||||||||||
| Reinvestment of distributions | 21 | — | 15,915 | 12,370 | — | 213,296 | 373,137 | ||||||||||||||
| Cost of shares redeemed | — | — | (432,640 | ) | (245,254 | ) | — | (498,110 | ) | (645,729 | ) | ||||||||||
| 266,283 | 100,010 | (101,699 | ) | 135,706 | 100,010 | 207,996 | 757,179 | ||||||||||||||
| Net increase from share transactions | 32,340,083 | 33,933,371 | 8,017,773 | 15,545,345 | 14,344,556 | 30,438,813 | 95,784,083 | ||||||||||||||
| Net increase in net assets | 35,098,267 | 33,903,290 | 13,371,855 | 37,977,238 | 14,681,497 | 67,893,728 | 86,133,673 | ||||||||||||||
| Net Assets | |||||||||||||||||||||
| Beginning of period | 33,903,290 | — | 295,031,778 | 257,054,540 | — | 967,330,724 | 881,197,051 | ||||||||||||||
| End of period† | $ | 69,001,557 | $ | 33,903,290 | $ | 308,403,633 | $ | 295,031,778 | $ | 14,681,497 | $ | 1,035,224,452 | $ | 967,330,724 | |||||||
| †Includes undistributed net investment income (deficit) of | $ | (11,531 | ) | $ | 6,862 | $ | (118,920 | ) | $ | 1,405,248 | $ | (60,149 | ) | $ | 1,216,280 | $ | 5,121,270 | ||||
* From August 1, 2016 (commencement of operations) to September 30, 2016.
**From December 1, 2016 (commencement of operations) to March 31, 2017.
| 208 | See notes to financial statements | 209 |
Statements of Changes in Net Assets
FIRST INVESTORS EQUITY FUNDS
| HEDGED U.S. EQUITY | ||||||||||||||
| OPPORTUNITIES | INTERNATIONAL | LONG SHORT | OPPORTUNITY | |||||||||||
| 10/1/2016 to | 8/1/2016 to | 10/1/2016 to | 10/1/2015 to | 12/1/2016 to | 10/1/2016 to | 10/1/2015 to | ||||||||
| 3/31/2017 | 9/30/2016 | * | 3/31/2017 | 9/30/2016 | 3/31/2017 | ** | 3/31/2017 | 9/30/2016 | ||||||
| Shares Issued and Redeemed | ||||||||||||||
| Class A: | ||||||||||||||
| Sold | 2,503,652 | 936,023 | 1,060,330 | 2,127,784 | 479,524 | 1,603,117 | 3,446,512 | |||||||
| Issued for distributions reinvested | — | — | 81,829 | 60,467 | — | 972,249 | 1,920,966 | |||||||
| Redeemed | (93,694 | ) | (1,070 | ) | (1,450,487 | ) | (2,343,185 | ) | (2,987 | ) | (2,061,955 | ) | (3,431,848 | ) |
| Net increase (decrease) in Class A shares outstanding | 2,409,958 | 934,953 | (308,328 | ) | (154,934 | ) | 476,537 | 513,411 | 1,935,630 | |||||
| Class B: | ||||||||||||||
| Sold | N/A | N/A | 6,011 | 10,638 | N/A | 12,593 | 27,316 | |||||||
| Issued for distributions reinvested | N/A | N/A | 451 | 321 | N/A | 13,901 | 32,258 | |||||||
| Redeemed | N/A | N/A | (25,097 | ) | (61,282 | ) | N/A | (55,549 | ) | (83,444 | ) | |||
| Net decrease in Class B shares outstanding | N/A | N/A | (18,635 | ) | (50,323 | ) | N/A | (29,055 | ) | (23,870 | ) | |||
| Advisor Class: | ||||||||||||||
| Sold | 919,077 | 2,477,541 | 1,205,710 | 2,058,313 | 940,001 | 395,315 | 903,793 | |||||||
| Issued for distributions reinvested | 687 | — | 39,571 | 23,393 | — | 85,669 | 121,493 | |||||||
| Redeemed | (114,898 | ) | (2,075 | ) | (291,945 | ) | (720,035 | ) | — | (170,589 | ) | (346,735 | ) | |
| Net increase in Advisor Class shares outstanding | 804,866 | 2,475,466 | 953,336 | 1,361,671 | 940,001 | 310,395 | 678,551 | |||||||
| Institutional Class: | ||||||||||||||
| Sold | 25,977 | 10,001 | 23,594 | 27,762 | 10,001 | 12,859 | 28,565 | |||||||
| Issued for distributions reinvested | 2 | — | 1,272 | 920 | — | 5,652 | 10,159 | |||||||
| Redeemed | — | — | (32,915 | ) | (18,468 | ) | — | (12,964 | ) | (17,889 | ) | |||
| Net increase (decrease) in Institutional Class shares | ||||||||||||||
| outstanding | 25,979 | 10,001 | (8,049 | ) | 10,214 | 10,001 | 5,547 | 20,835 | ||||||
* From August 1, 2016 (commencement of operations) to September 30, 2016.
**From December 1, 2016 (commencement of operations) to March 31, 2017.
| 210 | See notes to financial statements | 211 |
Statements of Changes in Net Assets
FIRST INVESTORS EQUITY FUNDS
| REAL ESTATE | SELECT GROWTH | SPECIAL SITUATIONS | TOTAL RETURN | |||||||||||||||||||||
| 10/1/2016 to | 10/1/2015 to | 10/1/2016 to | 10/1/2015 to | 10/1/2016 to | 10/1/2015 to | 10/1/2016 to | 10/1/2015 to | |||||||||||||||||
| 3/31/2017 | 9/30/2016 | 3/31/2017 | 9/30/2016 | 3/31/2017 | 9/30/2016 | 3/31/2017 | 9/30/2016 | |||||||||||||||||
| Increase (Decrease) in Net Assets From Operations | ||||||||||||||||||||||||
| Net investment income | $ | 1,510,496 | $ | 1,847,064 | $ | 238,181 | $ | 1,158,454 | $ | 471,056 | $ | 3,521,096 | $ | 5,460,005 | $ | 10,963,683 | ||||||||
| Net realized gain (loss) on investments | (338,340 | ) | 1,257,211 | 12,554,154 | 55,974,501 | 13,814,795 | 5,047,355 | 10,812,736 | 15,428,099 | |||||||||||||||
| Net unrealized appreciation (depreciation) of investments | (2,595,696 | ) | 6,328,298 | 31,369,697 | (29,597,382 | ) | 42,805,054 | 42,543,717 | 15,503,162 | 42,876,523 | ||||||||||||||
| Net increase (decrease) in net assets resulting | ||||||||||||||||||||||||
| from operations | (1,423,540 | ) | 9,432,573 | 44,162,032 | 27,535,573 | 57,090,905 | 51,112,168 | 31,775,903 | 69,268,305 | |||||||||||||||
| Distributions to Shareholders | ||||||||||||||||||||||||
| Net investment income – Class A | (321,677 | ) | (374,698 | ) | (980,941 | ) | (632,707 | ) | (2,826,286 | ) | (320,349 | ) | (7,171,907 | ) | (12,018,647 | ) | ||||||||
| Net investment income – Class B | N/A | N/A | (4,818 | ) | (352 | ) | (19,506 | ) | — | (36,565 | ) | (57,057 | ) | |||||||||||
| Net investment income – Advisor Class | (773,294 | ) | (1,064,535 | ) | (256,691 | ) | (144,240 | ) | (407,772 | ) | (61,500 | ) | (10,598 | ) | (17,508 | ) | ||||||||
| Net investment income – Institutional Class | (6,428 | ) | (22,157 | ) | (14,720 | ) | (10,456 | ) | (49,172 | ) | (10,970 | ) | (328,462 | ) | (532,976 | ) | ||||||||
| Net realized gains – Class A | (483,384 | ) | (35,427 | ) | (50,530,233 | ) | (34,595,217 | ) | (4,182,726 | ) | (24,838,426 | ) | (13,217,287 | ) | (18,715,227 | ) | ||||||||
| Net realized gains – Class B | N/A | N/A | (489,800 | ) | (437,191 | ) | (36,300 | ) | (251,921 | ) | (120,124 | ) | (193,359 | ) | ||||||||||
| Net realized gains – Advisor Class | (846,808 | ) | (111,064 | ) | (9,424,580 | ) | (4,961,052 | ) | (543,887 | ) | (2,451,492 | ) | (16,705 | ) | (24,883 | ) | ||||||||
| Net realized gains – Institutional Class | (6,438 | ) | (2,496 | ) | (515,355 | ) | (349,535 | ) | (63,359 | ) | (334,021 | ) | (511,002 | ) | (709,203 | ) | ||||||||
| Total distributions | (2,438,029 | ) | (1,610,377 | ) | (62,217,138 | ) | (41,130,750 | ) | (8,129,008 | ) | (28,268,679 | ) | (21,412,650 | ) | (32,268,860 | ) | ||||||||
| Share Transactions | ||||||||||||||||||||||||
| Class A: | ||||||||||||||||||||||||
| Proceeds from shares sold | 13,147,444 | 18,454,657 | 23,200,277 | 53,942,655 | 31,170,022 | 57,114,576 | 49,972,435 | 119,860,031 | ||||||||||||||||
| Reinvestment of distributions | 780,950 | 395,757 | 51,034,443 | 34,969,346 | 6,946,846 | 24,976,809 | 20,130,838 | 30,372,755 | ||||||||||||||||
| Cost of shares redeemed | (2,319,642 | ) | (4,353,175 | ) | (33,577,630 | ) | (56,220,661 | ) | (40,281,064 | ) | (61,105,843 | ) | (66,386,384 | ) | (124,013,108 | ) | ||||||||
| 11,608,752 | 14,497,239 | 40,657,090 | 32,691,340 | (2,164,196 | ) | 20,985,542 | 3,716,889 | 26,219,678 | ||||||||||||||||
| Class B: | ||||||||||||||||||||||||
| Proceeds from shares sold | N/A | N/A | 113,865 | 384,843 | 187,062 | 340,490 | 436,468 | 743,681 | ||||||||||||||||
| Reinvestment of distributions | N/A | N/A | 483,108 | 428,944 | 55,728 | 251,791 | 155,240 | 249,778 | ||||||||||||||||
| Cost of shares redeemed | N/A | N/A | (581,083 | ) | (1,280,290 | ) | (592,779 | ) | (961,049 | ) | (1,017,652 | ) | (1,817,144 | ) | ||||||||||
| N/A | N/A | 15,890 | (466,503 | ) | (349,989 | ) | (368,768 | ) | (425,944 | ) | (823,685 | ) | ||||||||||||
| Advisor Class: | ||||||||||||||||||||||||
| Proceeds from shares sold | 11,432,122 | 18,737,198 | 12,279,054 | 24,704,923 | 9,566,037 | 21,179,680 | 250,367 | 913,254 | ||||||||||||||||
| Reinvestment of distributions | 1,614,575 | 1,170,197 | 9,596,890 | 5,025,297 | 948,283 | 2,498,447 | 24,494 | 37,391 | ||||||||||||||||
| Cost of shares redeemed | (3,195,388 | ) | (11,348,437 | ) | (5,381,561 | ) | (8,735,085 | ) | (6,233,730 | ) | (6,267,393 | ) | (436,616 | ) | (743,012 | ) | ||||||||
| 9,851,309 | 8,558,958 | 16,494,383 | 20,995,135 | 4,280,590 | 17,410,734 | (161,755 | ) | 207,633 | ||||||||||||||||
| Institutional Class | ||||||||||||||||||||||||
| Proceeds from shares sold | 239,147 | 511,240 | 577,865 | 632,475 | 720,958 | 802,716 | 240,898 | 1,087,423 | ||||||||||||||||
| Reinvestment of distributions | 12,866 | 24,653 | 530,075 | 359,991 | 112,531 | 344,991 | 839,464 | 1,242,180 | ||||||||||||||||
| Cost of shares redeemed | (267,869 | ) | (1,019,222 | ) | (445,202 | ) | (594,620 | ) | (462,017 | ) | (472,929 | ) | (404,505 | ) | (1,865,316 | ) | ||||||||
| (15,856 | ) | (483,329 | ) | 662,738 | 397,846 | 371,472 | 674,778 | 675,857 | 464,287 | |||||||||||||||
| Net increase from share transactions | 21,444,205 | 22,572,868 | 57,830,101 | 53,617,818 | 2,137,877 | 38,702,286 | 3,805,047 | 26,067,913 | ||||||||||||||||
| Net increase in net assets | 17,582,636 | 30,395,064 | 39,774,995 | 40,022,641 | 51,099,774 | 61,545,775 | 14,168,300 | 63,067,358 | ||||||||||||||||
| Net Assets | ||||||||||||||||||||||||
| Beginning of period | 83,591,547 | 53,196,483 | 447,175,901 | 407,153,260 | 542,093,635 | 480,547,860 | 887,238,047 | 824,170,689 | ||||||||||||||||
| End of period† | $ | 101,174,183 | $ | 83,591,547 | $ | 486,950,896 | $ | 447,175,901 | $ | 593,193,409 | $ | 542,093,635 | $ | 901,406,347 | $ | 887,238,047 | ||||||||
| †Includes undistributed net investment income (deficit) of | $ | 827,433 | $ | 418,336 | $ | 139,322 | $ | 1,158,311 | $ | 311,974 | $ | 3,143,654 | $ | (6,207,420 | ) | $ | (4,119,893 | ) | ||||||
| 212 | See notes to financial statements | 213 |
Statements of Changes in Net Assets
FIRST INVESTORS EQUITY FUNDS
| REAL ESTATE | SELECT GROWTH | SPECIAL SITUATIONS | TOTAL RETURN | ||||||||||||||
| 10/1/2016 to | 10/1/2015 to | 10/1/2016 to | 10/1/2015 to | 10/1/2016 to | 10/1/2015 to | 10/1/2016 to | 10/1/2015 to | ||||||||||
| 3/31/2017 | 9/30/2016 | 3/31/2017 | 9/30/2016 | 3/31/2017 | 9/30/2016 | 3/31/2017 | 9/30/2016 | ||||||||||
| Shares Issued and Redeemed | |||||||||||||||||
| Class A: | |||||||||||||||||
| Sold | 1,369,505 | 1,855,661 | 2,149,633 | 4,874,467 | 1,122,125 | 2,313,645 | 2,629,514 | 6,498,557 | |||||||||
| Reinvestment of distributions | 82,613 | 39,622 | 5,154,994 | 3,125,053 | 248,457 | 1,003,488 | 1,068,523 | 1,652,437 | |||||||||
| Redeemed | (241,420 | ) | (426,479 | ) | (3,110,730 | ) | (5,093,990 | ) | (1,462,898 | ) | (2,472,288 | ) | (3,495,037 | ) | (6,721,953 | ) | |
| Net increase (decrease) in Class A shares outstanding | 1,210,698 | 1,468,804 | 4,193,897 | 2,905,530 | (92,316 | ) | 844,845 | 203,000 | 1,429,041 | ||||||||
| Class B: | |||||||||||||||||
| Sold | N/A | N/A | 12,454 | 38,378 | 8,947 | 18,036 | 23,282 | 41,142 | |||||||||
| Reinvestment of distributions | N/A | N/A | 57,376 | 43,725 | 2,619 | 13,148 | 8,391 | 13,816 | |||||||||
| Redeemed | N/A | N/A | (62,529 | ) | (132,379 | ) | (28,497 | ) | (50,124 | ) | (54,588 | ) | (100,497 | ) | |||
| Net increase (decrease) in Class B shares outstanding | N/A | N/A | 7,301 | (50,276 | ) | (16,931 | ) | (18,940 | ) | (22,915 | ) | (45,539 | ) | ||||
| Advisor Class: | |||||||||||||||||
| Sold | 1,185,190 | 1,916,747 | 1,128,482 | 2,202,432 | 342,317 | 854,224 | 12,965 | 47,824 | |||||||||
| Reinvestment of distributions | 170,417 | 117,391 | 957,773 | 445,505 | 33,687 | 99,938 | 1,294 | 2,025 | |||||||||
| Redeemed | (330,457 | ) | (1,140,297 | ) | (494,111 | ) | (782,048 | ) | (222,447 | ) | (251,602 | ) | (22,738 | ) | (39,591 | ) | |
| Net increase (decrease) in Advisor Class shares | |||||||||||||||||
| outstanding | 1,025,150 | 893,841 | 1,592,144 | 1,865,889 | 153,557 | 702,560 | (8,479 | ) | 10,258 | ||||||||
| Institutional Class: | |||||||||||||||||
| Sold | 24,878 | 49,689 | 54,161 | 57,585 | 25,467 | 32,960 | 12,613 | 58,841 | |||||||||
| Reinvestment of distributions | 1,360 | 2,490 | 52,639 | 31,802 | 3,976 | 13,745 | 44,256 | 67,216 | |||||||||
| Redeemed | (28,512 | ) | (97,131 | ) | (40,398 | ) | (53,039 | ) | (16,280 | ) | (19,072 | ) | (21,001 | ) | (100,652 | ) | |
| Net increase (decrease) in Institutional Class shares | |||||||||||||||||
| outstanding | (2,274 | ) | (44,952 | ) | 66,402 | 36,348 | 13,163 | 27,633 | 35,868 | 25,405 | |||||||
| 214 | See notes to financial statements | 215 |
Statement of Cash Flows
LONG SHORT FUND
For the Period December 1, 2016* through March 31, 2017
| Increase / decrease in cash | |||
| Cash flows from operating activities: | |||
| Net increase in assets from operations | $336,941 | ||
| Adjustments to reconcile net increase in net assets from | |||
| operations to net cash used in operating activities: | |||
| Purchase of investments securities | (17,000,190 | ) | |
| Proceeds from sale of investment securities | 4,957,822 | ||
| Proceeds from Short sale | (4,677,055 | ) | |
| Closed short transactions | 12,792,673 | ||
| Increase in cash deposited with broker for securities sold short | (8,100,946 | ) | |
| Increase in receivables for securities sold | (972,568 | ) | |
| Increase in dividends receivables | (13,007 | ) | |
| Increase in fund shares sold | (172,166 | ) | |
| Increase in payables for securities purchased | 1,155,249 | ||
| Increase in dividends on securities sold short payable | 6,759 | ||
| Increase in fund shares redeemed | 449 | ||
| Increase in advisory fees | 14,064 | ||
| Increase in accrued expenses | 38,107 | ||
| Net realized (gain) loss on investments | 119,800 | ||
| Net change in unrealized (appreciation) depreciation on securities | (516,890 | ) | |
| Net cash used by operating activities | (12,030,958 | ) | |
| Cash flows from financing activities: | |||
| Proceeds from sale of shares | 14,375,142 | ||
| Redemption of shares | (30,586 | ) | |
| Net cash provided by financing activities | 14,344,556 | ||
| Net increase in cash | 2,313,598 | ||
| Cash: | |||
| Beginning balance | — | ||
| Ending balance | 2,313,598 | ||
*Commencement of Operations
| 216 | See notes to financial statements |
Notes to Financial Statements
FIRST INVESTORS INCOME FUNDS
FIRST INVESTORS EQUITY FUNDS
March 31, 2017
1. Significant Accounting Policies— First Investors Income Funds (“Income Funds”) and First Investors Equity Funds (“Equity Funds”), each a Delaware statutory trust (each a “Trust”, collectively, “the Trusts”), are registered under the Investment Company Act of 1940 (the “1940 Act”) as open-end management investment companies and operate as series funds. Each Fund is an investment company and accordingly follows the investment company accounting and reporting guidance of the Financial Accounting Standards Board (FASB) Accounting Standard Codification Topic 946 “Financial Services – Investment Companies” including FASB Accounting Standard Update ASU 2013-08. The Income Funds issue shares of beneficial interest in the Balanced Income Fund, Floating Rate Fund, Fund For Income, Government Fund, Government Cash Management Fund, International Opportunities Bond Fund, Investment Grade Fund, Limited Duration High Quality Bond Fund and Strategic Income Fund. All of the Income Funds are diversified funds except International Opportunities Bond Fund which is a non-diversified fund. The Equity Funds issue shares of beneficial interest in the Covered Call Strategy Fund, Equity Income Fund, Global Fund, Growth & Income Fund, Hedged U.S. Equity Opportunities Fund, International Fund, Long Short Fund (commenced operations on December 1, 2016), Opportunity Fund, Real Estate Fund, Select Growth Fund, Special Situations Fund and Total Return Fund (each a “Fund”, collectively, “the Funds”). All of the Equity Funds are diversified funds, except Long Short Fund and Real Estate Fund which are non-diversified funds. The Trusts account separately for the assets, liabilities and operations of each Fund. The objective of each Fund as of March 31, 2017, is as follows:
Balanced Income Fund seeks income as its primary objective and has a secondary objective of capital appreciation.
Floating Rate Fund seeks a high level of current income.
Fund For Income seeks high current income.
Government Fund seeks to achieve a significant level of current income which is consistent with security and liquidity of principal.
Government Cash Management Fund seeks to earn a high rate of current income consistent with the preservation of capital and maintenance of liquidity.
International Opportunities Bond Fund seeks total return consisting of income and capital appreciation.
Investment Grade Fund seeks to generate a maximum level of income consistent with investment in investment grade debt securities.
Limited Duration High Quality Bond Fund seeks current income consistent with low volatility of principal.
Strategic Income Fund seeks a high level of current income.
Covered Call Strategy Fund seeks long-term capital appreciation.
| 217 |
Notes to Financial Statements (continued)
FIRST INVESTORS INCOME FUNDS
FIRST INVESTORS EQUITY FUNDS
March 31, 2017
Equity Income Fund seeks total return.
Global Fund seeks long-term capital growth.
Growth & Income Fund seeks long-term growth of capital and current income.
Hedged U.S. Equity Opportunities Fund seeks total return and, secondarily, capital appreciation.
International Fund primarily seeks long-term capital growth.
Long Short Fund seeks capital appreciation.
Opportunity Fund seeks long-term capital growth.
Real Estate Fund seeks total return.
Select Growth Fund seeks long-term growth of capital.
Special Situations Fund seeks long-term growth of capital.
Total Return Fund seeks high, long-term total investment return consistent with moderate investment risk.
A. Security Valuation—Except as provided below, a security listed or traded on an exchange or the Nasdaq Stock Market is valued at its last sale price on the exchange or market where the security is principally traded, and lacking any sales, the security is valued at the mean between the closing bid and asked prices. Securities traded in the over-the-counter (“OTC”) market (including securities listed on exchanges whose primary market is believed to be OTC) are valued at the mean between the last bid and asked prices based on quotes furnished by a market maker for such securities or an authorized pricing service. Fixed income securities, other than short-term debt securities held by the Government Cash Management Fund, are priced based upon valuations that are provided by a pricing service. Other securities may also be priced based upon valuations that are provided by pricing services approved by the Trusts’ Board of Trustees (the “Board”). The pricing services consider security type, rating, market condition and yield data as well as market quotations, prices provided by market makers and other available information in determining value. The net asset value of the Strategic Income Fund is derived from the net asset values of the underlying Funds in which it invests.
The Funds monitor for significant events occurring prior to the close of trading on the New York Stock Exchange that could have a material impact on the value of any securities that are held by the Funds. Examples of such events include trading halts, natural disasters, political events and issuer-specific developments. If the Valuation Committee of Foresters Investment Management Company, Inc. (“FIMCO”) decides that such
| 218 |
events warrant using fair value estimates, it will take such events into consideration in determining the fair values of such securities. If market quotations or prices are not readily available or are deemed to be unreliable, or do not appear to reflect significant events that have occurred prior to the time as of which the net asset value is calculated, the securities may be valued at fair value as determined in good faith pursuant to procedures adopted by the Board. The Funds also use evaluated prices from a pricing service to fair value foreign equity securities in the event that fluctuation in U.S. securities markets exceed a predetermined level or if a foreign market is closed. For valuation purposes, where applicable, quotations of foreign securities in foreign currencies are translated to U.S. dollar equivalents using the foreign exchange quotation in effect. At March 31, 2017, the Hedged U.S. Equity Opportunities Fund held one security that was fair valued at a value of $23,249 representing 0% of the Fund’s net assets.
The Government Cash Management Fund values its portfolio securities in accordance with the amortized cost method of valuation under Rule 2a-7 of the 1940 Act. Amortized cost is an approximation of market value of an instrument, whereby the difference between its acquisition cost and market value at maturity is amortized on a straight-line basis over the remaining life of the instrument. The effect of changes in the market value of a security as a result of fluctuating interest rates is not taken into account and thus the amortized cost method of valuation may result in the value of a security being higher or lower than its actual market value.
In accordance with Accounting Standards Codification 820 “Fair Value Measurements and Disclosures” (“ASC 820”), investments held by the Funds are carried at “fair value”. As defined by ASC 820, fair value is the price that a fund would receive upon selling an investment in an orderly transaction to an independent buyer in the principal or most advantageous market for the investment under current market conditions. Various inputs are used in determining the value of the fund’s investments.
In addition to defining fair value, ASC 820 established a three-tier hierarchy of inputs to establish a classification of fair value measurements for disclosure purposes. The three-tier hierarchy of inputs is summarized in the three broad Levels listed below:
Level 1—Unadjusted quoted prices in active markets for identical securities that the Fund has the ability to access.
Level 2—Observable inputs other than quoted prices included in Level 1 that are observable for the asset or liability, either directly or indirectly. These inputs may include quoted prices for the identical instrument on an inactive market, prices for similar
| 219 |
Notes to Financial Statements (continued)
FIRST INVESTORS INCOME FUNDS
FIRST INVESTORS EQUITY FUNDS
March 31, 2017
instruments, interest rates, prepayment speeds, credit risk, yield curves, default rates and similar data.
Level 3—Unobservable inputs for the asset or liability, to the extent relevant observable inputs are not available, representing the Fund’s own assumption about the assumptions a market participant would use in valuing the asset or liability, and would be based on the best information available.
Equity securities traded on an exchange or the Nasdaq Stock Market are categorized in Level 1 of the fair value hierarchy to the extent that they are actively traded and valuation adjustments are not applied. The underlying Funds in which Strategic Income Fund invests are also categorized in Level 1. Foreign securities that are fair valued in the event that fluctuations in U.S. securities markets exceed a predetermined level or if a foreign market is closed are categorized in Level 2. Variable and floating rate, corporate, sovereign and municipal bonds, asset backed, U.S. Government and U.S. Government Agency securities, pass-through certificates and loan participations are categorized in Level 2 to the extent that the inputs are observable and timely, otherwise they would be categorized in Level 3. Short-term notes that are valued at amortized cost by the Government Cash Management Fund are categorized in Level 2. Foreign exchange contracts that are considered derivative instruments and are valued at the net unrealized appreciation or depreciation on the instruments are categorized in Level 2. Securities that are fair valued by the Valuation Committee may be categorized in either Level 2 or Level 3 of the fair value hierarchy depending on the relative significance of the unobservable valuation inputs.
The aggregate value by input level, as of March 31, 2017, for each Fund’s investments is included following each Fund’s portfolio of investments.
B. Federal Income Taxes—No provision has been made for federal income taxes on net income or capital gains since it is the policy of each Fund to continue to comply with the special provisions of the Internal Revenue Code applicable to investment companies, and to make sufficient distributions of income and capital gains (in excess of any available capital loss carryovers) to relieve it from all, or substantially all, such taxes. At September 30, 2016, capital loss carryovers were as follows:
| 220 |
| Capital Loss Carryovers | ||||||||||||||||||
| Not Subject | ||||||||||||||||||
| Year Capital Loss Carryforwards Expire | to Expiration | |||||||||||||||||
| Long | Short | |||||||||||||||||
| Fund | Total | 2017 | 2018 | 2019 | Term | Term | ||||||||||||
| Floating Rate | $ | 2,912,006 | $ | — | $ | — | $ | — | $ | 2,132,843 | $ | 779,163 | ||||||
| Fund For Income | 155,604,220 | 23,949,720 | 110,622,886 | — | 16,070,123 | 4,961,491 | ||||||||||||
| Government | 14,175,335 | — | — | 40,595 | — | 14,134,740 | ||||||||||||
| International Opportunities Bond | 461,028 | — | — | — | 269,187 | 191,841 | ||||||||||||
| Investment Grade | 2,682,018 | 2,299,840 | — | — | 382,178 | — | ||||||||||||
| Limited Duration | ||||||||||||||||||
| High Quality Bond | 505,114 | — | — | — | 186,747 | 318,367 | ||||||||||||
| Strategic Income | 249,919 | — | — | — | 191,783 | 58,136 | ||||||||||||
| Covered Call Strategy | 224,724 | — | — | — | — | 224,724 | ||||||||||||
| Global | 2,232,649 | — | — | — | — | 2,232,649 | ||||||||||||
| Hedged U.S. | ||||||||||||||||||
| Equity Opportunities | 7,734 | — | — | — | 1,078 | 6,656 | ||||||||||||
| International | 29,410,125 | — | 19,627,323 | 2,191,242 | 2,774,463 | 4,817,097 | ||||||||||||
As a result of the passage of the Regulated Investment Company Modernization Act of 2010 (“the Modernization Act of 2010”), losses incurred in fiscal year 2010 and beyond retain their character as short-term or long-term, have no expiration date and are utilized prior to capital loss carryovers occurring prior to the enactment of the Modernization Act of 2010.
The Funds recognize the tax benefits of uncertain tax positions only where the position is “more likely than not” to be sustained assuming examination by tax authorities. Management has analyzed the Funds’ tax positions and has concluded that no liability for unrecognized tax benefits should be recorded related to uncertain tax positions taken on returns filed for open tax years 2014–2016, or expected to be taken in the Funds’ 2017 tax returns. The Funds identify their major tax jurisdictions as U.S. Federal, New York State, New York City and foreign jurisdictions where the Funds make significant investments; however, the Funds are not aware of any tax position for which it is reasonably possible that the total amounts of unrecognized tax benefits will change materially in the next twelve months.
C. Distributions to Shareholders—Dividends from net investment income of Balanced Income Fund, Floating Rate Fund, Fund For Income, Government Fund, Investment Grade Fund, Limited Duration High Quality Bond Fund, and Strategic Income Fund are generally declared daily and paid monthly. The Government Cash Management Fund declares distributions, if any, daily and pays distributions monthly. Distributions are declared from the total of net investment income plus or minus all realized short-term gains and losses on investments. Prior to March 31, 2016, dividends from
| 221 |
Notes to Financial Statements (continued)
FIRST INVESTORS INCOME FUNDS
FIRST INVESTORS EQUITY FUNDS
March 31, 2017
net investment income of International Opportunities Bond Fund were generally declared daily and paid monthly. Effective April 1, 2016, dividends from net investment income, if any, of International Opportunities Bond Fund are declared and paid quarterly. Dividends from net investment income, if any, of Covered Call Strategy Fund, Equity Income Fund, Growth & Income Fund, Real Estate Fund and Total Return Fund are declared and paid quarterly. Dividends from net investment income, if any, of Global Fund, Hedged U.S. Equity Opportunities Fund, International Fund, Long Short Fund, Opportunity Fund, Select Growth Fund and Special Situations Fund are declared and paid annually. Distributions from net realized capital gains, if any, of each of the Funds are normally declared and paid annually. Income dividends and capital gain distributions are determined in accordance with income tax regulations which may differ from accounting principles generally accepted in the United States of America. These differences are primarily due to differing treatments for capital loss carryforwards, deferral of wash sales losses, post-October capital losses, late loss deferrals, net operating losses and foreign currency transactions.
D. Expense Allocation—Expenses directly charged or attributable to a Fund are paid from the assets of that Fund. General expenses of the Trusts are allocated among and charged to the assets of each Fund on a fair and equitable basis, which may be based on the relative assets of each Fund or the nature of the services performed and relative applicability to each Fund.
E. Use of Estimates—The preparation of the financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the financial statements and the reported amounts of revenue and expense during the reporting period. Actual results could differ from those estimates.
F. Foreign Currency Translations—The accounting records of all of the Funds are maintained in U.S. dollars, including those Funds that invest in foreign securities. Portfolio securities and other assets and liabilities denominated in foreign currencies are translated to U.S. dollars at the date of valuation. Purchases and sales of foreign investment securities, dividend income and certain expenses are translated to U.S. dollars at the rates of exchange prevailing on the respective dates of such transactions.
International Opportunities Bond Fund, Global Fund, Hedged U.S. Equity Opportunities Fund and International Fund do not isolate that portion of gains and losses on foreign investments which is due to changes in foreign exchange rates from that which is due to changes in market prices of the investments. These changes are included with the net realized and unrealized gains and losses from investments.
| 222 |
Net realized and unrealized gains and losses on foreign currency transactions include gains and losses from the sales of foreign currency and gains and losses on accrued foreign dividends and related withholding taxes.
G. Other—Security transactions are generally accounted for on the first business day following the date the securities are purchased or sold, except for financial reporting purposes, which is trade date. Investments in securities issued on a when-issued or delayed delivery basis are generally reflected in the assets of the Funds on the first business day following the date the securities are purchased and the Funds segregate assets for these transactions. Cost of securities is determined and gains and losses are based on the identified cost basis for both financial statement and federal income tax purposes. Dividend income is recorded on the ex-dividend date or for certain foreign dividends, as soon as the Fund becomes aware of the dividends. Interest income and estimated expenses are accrued daily. Bond discounts and premiums are accreted or amortized using the interest method. Withholding taxes on foreign dividends have been provided in accordance with the Funds’ understanding of the applicable country’s tax rules and rates. The Bank of New York Mellon serves as custodian for the Funds and may provide credits against custodian charges based on uninvested cash balance of the Funds. For the six months ended March 31, 2017, the Income Funds and Equity Funds received credits in the amount of $20,952 and $13,172, respectively. Certain of the Income and Equity Funds reduced expenses through brokerage service arrangements. For the six months ended March 31, 2017, expenses were reduced by a total of $109 for certain of the Income Funds and $16,933 for certain of the Equity Funds under these arrangements.
| 223 |
Notes to Financial Statements (continued)
FIRST INVESTORS INCOME FUNDS
FIRST INVESTORS EQUITY FUNDS
March 31, 2017
2. Security Transactions—For the six months ended March 31, 2017, purchases and sales of securities and long-term U.S. Government obligations (excluding U.S. Treasury bills, short-term securities and foreign currencies) were as follows:
| Long-Term U.S. | |||||||||||
| Securities | Government Obligations | ||||||||||
| Cost of | Proceeds | Cost of | Proceeds | ||||||||
| Fund | Purchases | of Sales | Purchases | of Sales | |||||||
| Balanced Income | $ | 18,281,507 | $ | 6,877,385 | $ | 2,904,182 | $ | 2,203,821 | |||
| Floating Rate | 64,896,340 | 48,616,097 | — | — | |||||||
| Fund For Income | 227,228,424 | 232,924,430 | — | — | |||||||
| Government | 58,276,812 | 61,144,346 | 23,522,017 | 38,803,946 | |||||||
| International Opportunities | |||||||||||
| Bond | 21,844,985 | 18,439,805 | 26,741,138 | 27,625,942 | |||||||
| Investment Grade | 148,850,220 | 124,211,453 | — | 18,050,652 | |||||||
| Limited Duration | |||||||||||
| High Quality Bond | 49,465,914 | 33,118,351 | 991,016 | — | |||||||
| Strategic Income | 36,914,395 | 27,190,619 | — | — | |||||||
| Covered Call Strategy | 230,039,729 | 136,357,963 | — | — | |||||||
| Equity Income | 45,151,141 | 57,617,445 | — | — | |||||||
| Global | 320,194,515 | 315,196,871 | — | — | |||||||
| Growth & Income | 150,464,165 | 223,735,061 | — | — | |||||||
| Hedged U.S. Equity | |||||||||||
| Opportunities | 46,467,764 | 17,608,097 | — | — | |||||||
| International | 68,605,367 | 66,062,910 | — | — | |||||||
| Long Short | 17,000,190 | 4,957,822 | — | — | |||||||
| Opportunity | 180,995,797 | 179,338,402 | — | — | |||||||
| Real Estate | 27,255,324 | 6,394,531 | — | — | |||||||
| Select Growth | 131,660,795 | 132,450,207 | — | — | |||||||
| Special Situations | 93,370,026 | 100,541,372 | — | — | |||||||
| Total Return | 145,305,112 | 179,683,065 | 28,169,103 | 29,767,197 | |||||||
| 224 |
At March 31, 2017, aggregate cost and net unrealized appreciation (depreciation) of securities for federal income tax purposes were as follows:
| Gross | Gross | Net Unrealized | ||||||||||
| Aggregate | Unrealized | Unrealized | Appreciation | |||||||||
| Fund | Cost | Appreciation | Depreciation | (Depreciation) | ||||||||
| Balanced Income | $ | 42,282,453 | $ | 1,817,353 | $ | 748,478 | $ | 1,068,875 | ||||
| Floating Rate | 155,477,196 | 1,412,896 | 512,310 | 900,586 | ||||||||
| Fund For Income | 658,670,532 | 19,473,668 | 4,810,276 | 14,663,392 | ||||||||
| Government | 327,796,393 | 3,471,990 | 5,733,901 | (2,261,911) | ||||||||
| International Opportunities | ||||||||||||
| Bond | 128,563,949 | 2,324,613 | 14,118,655 | (11,794,042) | ||||||||
| Investment Grade | 575,788,701 | 8,384,904 | 10,805,914 | (2,421,010) | ||||||||
| Limited Duration | ||||||||||||
| High Quality Bond | 135,573,870 | 136,228 | 2,970,883 | (2,834,655) | ||||||||
| Strategic Income | 161,936,927 | 357,514 | 4,731,543 | (4,374,029) | ||||||||
| Covered Call Strategy | 184,060,111 | 13,358,841 | 1,455,640 | 11,903,201 | ||||||||
| Equity Income | 439,167,330 | 193,030,690 | 9,387,398 | 183,643,292 | ||||||||
| Global | 493,203,263 | 68,785,817 | 5,142,134 | 63,643,683 | ||||||||
| Growth & Income | 1,132,929,952 | 702,821,395 | 28,669,274 | 674,152,121 | ||||||||
| Hedged U.S. Equity | ||||||||||||
| Opportunities | 60,579,890 | 5,160,074 | 558,913 | 4,601,161 | ||||||||
| International | 237,257,277 | 73,916,820 | 2,727,903 | 71,188,917 | ||||||||
| Long Short | 12,122,994 | 771,564 | 121,632 | 649,932 | ||||||||
| Opportunity | 735,615,466 | 315,423,347 | 17,228,788 | 298,194,559 | ||||||||
| Real Estate | 98,036,626 | 5,127,095 | 3,979,896 | 1,147,199 | ||||||||
| Select Growth | 394,335,137 | 100,994,670 | 9,531,418 | 91,463,252 | ||||||||
| Special Situations | 451,309,294 | 151,403,408 | 14,593,113 | 136,810,295 | ||||||||
| Total Return | 720,872,712 | 195,588,078 | 13,590,731 | 181,997,347 | ||||||||
The Strategic Income Fund may invest in Institutional Class shares of the Floating Rate Fund, Fund For Income, Government Fund, Government Cash Management Fund, International Opportunities Bond Fund, Investment Grade Fund, Limited Duration High Quality Bond Fund, Covered Call Strategy Fund, Equity Income Fund, Real Estate Fund, Tax Exempt Income Fund and Tax Exempt Opportunities Fund. During the six months ended March 31, 2017, purchases and sales of shares, dividends, capital gain distributions received and realized gains (losses) recognized by Strategic Income Fund from investments in these Funds were as follows:
| 225 |
Notes to Financial Statements (continued)
FIRST INVESTORS INCOME FUNDS
FIRST INVESTORS EQUITY FUNDS
March 31, 2017
| Balance | Balance | Realized | ||||||||||||||
| of Shares | of Shares | Gain (Loss) | ||||||||||||||
| Held | Purchases/ | Sales/ | Held | Value | Dividend | Capital Gain | on Security | |||||||||
| Fund | 9/30/2016 | Additions | Reductions | 3/31/2017 | 3/31/2017 | Income | Distributions | Transactions | ||||||||
| Covered Call | ||||||||||||||||
| Strategy | 363,379 | 81,339 | — | 444,718 | $ 4,838,535 | $ 33,994 | $ 6,216 | $ — | ||||||||
| Floating Rate | 1,158,454 | 856,737 | — | 2,015,191 | 19,466,743 | 285,223 | — | — | ||||||||
| Fund For Income | 23,873,743 | 1,504,998 | (1,855,702) | 23,523,039 | 58,807,597 | 1,574,588 | — | 62,197 | ||||||||
| Government | 683,229 | 764,942 | (690,146) | 758,025 | 7,966,838 | 8,030 | — | (55,741) | ||||||||
| International | ||||||||||||||||
| Opportunities Bond | 829,735 | 488,686 | (437,252) | 881,169 | 8,018,634 | — | — | (537,910) | ||||||||
| Investment Grade | 2,983,095 | 195,855 | (273,061) | 2,905,889 | 27,809,357 | 563,473 | — | (6,059) | ||||||||
| Limited Duration | ||||||||||||||||
| High Quality Bond | 2,280,447 | 151,488 | — | 2,431,935 | 23,152,019 | 302,858 | — | — | ||||||||
| Equity Income | — | 464,670 | (464,670) | — | — | 26,314 | 71,067 | 335,367 | ||||||||
| Tax Exempt Income | — | 405,515 | (405,515) | — | — | 40,147 | — | (16,016) | ||||||||
| 32,172,082 | 4,914,230 | (4,126,346) | 32,959,966 | $150,059,723 | $2,834,627 | $77,283 | $(218,162) |
The Strategic Income Funds operates as a fund of funds – also referred to as a multi-manager investment – an investment strategy in which a fund invests in other types of funds. This strategy invests in a portfolio that contains different underlying assets instead of investing directly in bonds, stocks and other types of securities.
The financial statements of each of the Funds in which Strategic Income had investments during the period ended March 31, 2017 are included in this report except Tax Exempt Income Fund, whose most recent financial statements as of December 31, 2016 is available and can be viewed by visiting our website www.foresters.com, by calling 1-800-423-4026 or by writing to us at the following address: Foresters Financial Services, Inc., 40 Wall Street, New York, NY 10005.
3. Advisory Fee and Other Transactions With Affiliates—Certain officers of the Trusts are officers of the Trusts’ investment adviser, FIMCO, their underwriter, Foresters Financial Services, Inc. (“FFS”) and their transfer agent, Foresters Investor Services, Inc. (“FIS”). Trustees of the Trusts who are not officers or directors of FIMCO or its affiliates are remunerated by the Funds. For the six months ended March 31, 2017, total trustees fees accrued by the Income Funds and Equity Funds amounted to $64,514 and $176,667, respectively.
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The Investment Advisory Agreements provide as compensation to FIMCO for each Fund, an annual fee, payable monthly, at the following rates:
Balanced Income Fund—.70% on the first $300 million of the Fund’s average daily net assets, .65% on the next $200 million, .60% on the next $500 million, .55% on the next $1 billion, declining by .05% on each $1 billion thereafter down to .45% on average daily net assets over $3 billion. For the six months ended March 31, 2017, FIMCO has waived, pursuant to an expense limitation agreement, $78,976 in advisory fees to limit the Fund’s overall expense ratio (exclusive of certain expenses) to 1.15% on Class A shares, .82% on Advisor Class shares and .69% on Institutional Class shares.
Floating Rate Fund—.60% on the first $250 million of the Fund’s average daily net assets, .55% on the next $250 million, .50% on the next $500 million and .45% on the next $1 billion and .40% on average daily net assets over $2 billion. For the six months ended March 31, 2017, FIMCO has waived, pursuant to an expense limitation agreement, $95,330 in advisory fees to limit the Fund’s overall expense ratio (exclusive of certain expenses) to 1.10% on Class A shares, .90% on Advisor Class shares and .70% on Institutional Class shares.
Fund For Income and International Opportunities Bond Fund—.75% on the first $250 million of each Fund’s average daily net assets, .72% on the next $250 million, .69% on the next $250 million, .66% on the next $500 million, declining by .02% on each $500 million thereafter, down to .60% on average daily net assets over $2.25 billion. For the six months ended March 31, 2017, FIMCO has voluntarily waived $81,946 in advisory fees on Fund For Income to limit the advisory fee to .70% of its average daily net assets.
Government, Investment Grade, and Limited Duration High Quality Bond—.66% on the first $500 million of each Fund’s average daily net assets, declining by .02% on each $500 million thereafter, down to .60% on average daily net assets over $1.5 billion. For the six months ended March 31, 2017, FIMCO has voluntarily waived $173,957, in advisory fees on Government Fund to limit the advisory fee to .55% of its average daily net assets. For the six months ended March 31, 2017, FIMCO has voluntarily waived $311,813 in advisory fees on Investment Grade Fund to limit the advisory fee to .55% of its average daily net assets. For the six months ended March 31, 2017, FIMCO has waived, pursuant to an expense limitation agreement, $131,690 in advisory fees to limit the Limited Duration High Quality Bond Fund’s overall expense ratio (exclusive of certain expenses) to 1.05% on Class A shares, .75% on Advisor Class shares and .60% on Institutional Class shares.
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Notes to Financial Statements (continued)
FIRST INVESTORS INCOME FUNDS
FIRST INVESTORS EQUITY FUNDS
March 31, 2017
Government Cash Management Fund—.50% of the Fund’s average daily net assets. For the six months ended March 31, 2017, FIMCO has voluntarily waived the Fund’s entire advisory fee of $325,777 and assumed $4,091 of other Fund expenses to prevent a negative yield on the Fund’s shares.
Strategic Income Fund—.05% of the Fund’s average daily net assets.
Covered Call Strategy Fund—.80% on the first $300 million of each Fund’s average daily net assets, .75% on the next $200 million, .70% on the next $500 million, declining by .05% on each $1 billion thereafter, down to .55% on average daily net assets of $3 billion. For the six months ended March 31, 2017, FIMCO has waived, pursuant to an expense limitation agreement $126,546 in advisory fees to limit the Covered Call Strategy Fund’s overall expense ratio (exclusive of certain expenses) to 1.30% on Class A shares, .97% on Advisor Class shares and .84% on Institutional Class shares.
Equity Income, Growth & Income, Opportunity, Real Estate and Select Growth Funds—.75% on the first $300 million of each Fund’s average daily net assets, .72% on the next $200 million, .69% on the next $250 million, .66% on the next $500 million, declining by .02% on each $500 million thereafter, down to .60% on average daily net assets over $2.25 billion.
Global Fund—.95% on the first $600 million, .92% on the next $400 million, .90% on the next $500 million and .88% on average daily net assets over $1.5 billion. For the six months ended March 31, 2017, FIMCO has voluntarily waived $131,999 in advisory fees to limit the advisory fee to .90% of the Fund’s average daily net assets.
Hedged U.S. Equity Opportunities Fund—1.15% on the first $100 million of each Fund’s average daily net assets, 1.10% on the next $400 million, 1.05% on the next $500 million, declining by .05% on each $1 billion thereafter, down to .90% on average daily net assets of $3 billion. For the six months ended March 31, 2017, FIMCO has waived, pursuant to an expense limitation agreement, $47,586 in advisory fees to limit the Hedged U.S. Equity Opportunities Fund’s overall expense ratio (exclusive of certain expenses) to 1.75% on Class A shares, 1.42% on Advisor Class shares and 1.31% on Institutional Class shares.
International Fund— 98% on the first $300 million of the Fund’s average daily net assets, .95% on the next $300 million, .92% on the next $400 million, .90% on the next $500 million and .88% on average daily net assets over $1.5 billion.
Long Short Fund—1.40% of the Fund’s average daily net assets. For the period December 1, 2016 to March 31, 2017, FIMCO has waived, pursuant to an expense limitation agreement $34,992 in advisory fees to limit the Long Short Fund’s overall
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expense ratio (exclusive of certain expenses) to 1.95% on Class A shares, 1.67% on Advisor Class shares and 1.54% on Institutional Class shares.
Special Situations Fund—.90% on the first $200 million of the Fund’s average daily net assets, .75% on the next $300 million, .72% on the next $250 million, .69% on the next $250 million, .66% on the next $500 million and .64% on average daily net assets over $1.5 billion.
Total Return Fund—.75% on the first $300 million of the Fund’s average daily net assets, .70% on the next $200 million, .65% on the next $500 million, .60% on the next $1 billion, .55% on the next $1 billion, down to .50% on average daily net assets over $3 billion.
For the six months ended March 31, 2017, total advisory fees accrued to FIMCO by the Income Funds and Equity Funds were $7,264,392 and $23,922,189, respectively, of which $1,199,489 and $341,123, respectively, was waived by FIMCO as noted above.
FIMCO has entered into an expense limitation agreement with the Balanced Income Fund (“BIF”) to limit BIF’s total annual fund operating expenses (exclusive of interest expenses, taxes, brokerage commissions, acquired fund fees and expenses, dividend costs related to short sales, and extraordinary expenses, such as litigation expenses, if any) to 1.15% of the average daily net assets on Class A shares, .82% of the average daily net assets on Advisor Class shares and .69% of the average daily net assets on Institutional Class shares. The agreement expires on January 31, 2018. For the period ended March 31, 2017, FIMCO assumed $78,976, under the terms of the agreement. FIMCO and BIF have agreed that any expenses of BIF assumed by FIMCO pursuant to this agreement be repaid to FIMCO by BIF within three years after the date the fee limitation and/or expense reimbursement has been made by FIMCO, provided that such repayment does not cause the expenses of BIF’s Class A shares, Advisor Class shares and Institutional Class shares to exceed the applicable expense ratio in place at the time the expenses are waived or assumed or the current limits established under the expense limitation agreement. For the period October 1, 2015 (commencement of operations) through March 31, 2017, FIMCO assumed $255,544 under the terms of the agreement of which $176,568 expires on September 30, 2019 and $78,976 expires on September 30, 2020. The expense limitation agreement may be terminated or amended prior to January 31, 2018, with the approval of the Board.
FIMCO has entered into an expense limitation agreement with the Floating Rate Fund (“FRF”) to limit FRF’s total annual fund operating expenses (exclusive of interest expenses, taxes, brokerage commissions, acquired fund fees and expenses, dividend costs related to short sales, and extraordinary expenses, such as litigation expenses, if any) to 1.10% of the average daily net assets on Class A shares, .90% of the average
| 229 |
Notes to Financial Statements (continued)
FIRST INVESTORS INCOME FUNDS
FIRST INVESTORS EQUITY FUNDS
March 31, 2017
daily net assets on Advisor Class shares and .70% of the average daily net assets on Institutional Class shares. The agreement expires on January 31, 2018. For the period ended March 31, 2017, FIMCO assumed $95,330, under the terms of the agreement. FIMCO and FRF have agreed that any expenses of FRF assumed by FIMCO pursuant to this agreement be repaid to FIMCO by FRF within three years after the date the fee limitation and/or expense reimbursement has been made by FIMCO, provided that such repayment does not cause the expenses of FRF’s Class A shares, Advisor Class shares and Institutional Class shares to exceed the applicable expense ratio in place at the time the expenses are waived or assumed or the current limits established under the expense limitation agreement. For the period October 21, 2013 (commencement of operations) through March 31, 2017, FIMCO assumed $678,908 under the terms of the agreement of which $223,534 expires on September 30, 2017, $198,431 expires on September 30, 2018, $161,613 expires on September 30, 2019 and $95,330 expires on September 30, 2020. The expense limitation agreement may be terminated or amended prior to January 31, 2018, with the approval of the Board.
FIMCO had entered into an expense limitation agreement with the International Opportunities Bond Fund (“IOBF”) to limit IOBF’s total annual fund operating expenses (exclusive of interest expenses, taxes, brokerage commissions, acquired fund fees and expenses, dividend costs related to short sales, and extraordinary expenses, such as litigation expenses, if any) to 1.30% of the average daily net assets on Class A shares. The agreement expired on January 31, 2016. FIMCO and IOBF have agreed that any expenses of IOBF assumed by FIMCO pursuant to this agreement be repaid to FIMCO by IOBF within three years after the date the fee limitation and/or expense reimbursement has been made by FIMCO, provided that such repayment does not cause the expenses of IOBF’s Class A shares to exceed the applicable expense ratio in place at the time the expenses are waived or assumed. For the period August 20, 2012 (commencement of operations) to January 31, 2016 (expiration of the expense limitation agreement), FIMCO assumed $684,479 under the terms of the agreement of which $278,248 expired on September 30, 2015, $228,243 expired on September 30, 2016, $94,746 expires on September 30, 2017, $62,359 expires on September 30, 2018, and $20,883 expires on September 30, 2019.
FIMCO has entered into an expense limitation agreement with the Limited Duration High Quality Bond Fund (“LDHQ”) to limit LDHQ’s total annual fund operating expenses (exclusive of interest expenses, taxes, brokerage commissions, acquired fund fees and expenses, dividend costs related to short sales, and extraordinary expenses, such as litigation expenses, if any) to 1.05% of the average daily net assets on Class A shares, .75% of the average daily net assets on Advisor Class shares and .60% of the average daily net assets on Institutional Class shares. The agreement expires on
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January 31, 2018. For the period ended March 31, 2017, FIMCO assumed $131,690, under the terms of the agreement. FIMCO and LDHQ have agreed that any expenses of LDHQ assumed by FIMCO pursuant to this agreement be repaid to FIMCO by LDHQ within three years after the date the fee limitation and/or expense reimbursement has been made by FIMCO, provided that such repayment does not cause the expenses of LDHQ’s Class A shares, Advisor Class shares and Institutional Class shares to exceed the applicable expense ratio in place at the time the expenses are waived or assumed or the current limits established under the expense limitation agreement. For the period May 19, 2014 (commencement of operations) to March 31, 2017, FIMCO assumed $678,253 under the terms of the agreement of which $143,148 expires on September 30, 2017, $179,140 expires on September 30, 2018, $224,275 expires on September 30, 2019 and $131,690 expires on September 30, 2020. The expense limitation agreement may be terminated or amended prior to January 31, 2018, with the approval of the Board.
FIMCO has entered into an expense limitation agreement with the Covered Call Strategy Fund (“CCS”) to limit CCS’s total annual fund operating expenses (exclusive of interest expenses, taxes, brokerage commissions, acquired fund fees and expenses, dividend costs related to short sales, and extraordinary expenses, such as litigation expenses, if any) to 1.30% of the average daily net assets on Class A shares, .97% of the average daily net assets on Advisor Class shares and .84% of the average daily net assets on Institutional Class shares. The agreement expires on January 31, 2018. For the period ended March 31, 2017, FIMCO assumed $126,546 under terms of the agreement. FIMCO and CCS have agreed that any expenses of CCS assumed by FIMCO pursuant to this agreement be repaid to FIMCO by CCS within three years after the date the fee limitation and/or expense reimbursement has been made by FIMCO, provided that such repayment does not cause the expenses of CCS’s Class A shares, Advisor Class shares and Institutional Class shares to exceed the applicable expense ratio in place at the time the expenses are waived or assumed or the current limits established under the expense limitation agreement. For the period April 1, 2016 (commencement of operations) through March 31, 2017, FIMCO assumed $257,047 under the terms of the agreement of which $130,501 expires on September 30, 2019, and $126,546 expires on September 30, 2020. The expense limitation agreement may be terminated or amended prior to January 31, 2018, with the approval of the Board.
FIMCO has entered into an expense limitation agreement with the Hedged U.S. Equity Opportunities Fund (“HUSEO”) to limit HUSEO’s total annual fund operating expenses (exclusive of interest expenses, taxes, brokerage commissions, acquired fund fees and expenses, dividend costs related to short sales, and extraordinary expenses, such as litigation expenses, if any) to 1.75% of the average daily net assets on Class A
| 231 |
Notes to Financial Statements (continued)
FIRST INVESTORS INCOME FUNDS
FIRST INVESTORS EQUITY FUNDS
March 31, 2017
shares, 1.42% of the average daily net assets on Advisor Class shares and 1.31% of the average daily net assets on Institutional Class shares. The agreement expires on January 31, 2018. For the period ended March 31, 2017, FIMCO assumed $47,586 under terms of the agreement. FIMCO and HUSEO have agreed that any expenses of HUSEO assumed by FIMCO pursuant to this agreement be repaid to FIMCO by HUSEO within three years after the date the fee limitation and/or expense reimbursement has been made by FIMCO, provided that such repayment does not cause the expenses of HUSEO’s Class A shares, Advisor Class shares and Institutional Class shares to exceed the applicable expense ratio in place at the time the expenses are waived or assumed or the current limits established under the expense limitation agreement. For the period August 1, 2016 (commencement of operations) through March 31, 2017, FIMCO assumed $106,841 under the terms of the agreement of which $59,255 expires on September 30, 2019 and $47,586 expires on September 30, 2020. The expense limitation agreement may be terminated or amended prior to January 31, 2018, with the approval of the Board.
FIMCO has entered into an expense limitation agreement with the Long Short Fund (“LSF”) to limit LSF’s total annual fund operating expenses (exclusive of interest expenses, taxes, brokerage commissions, acquired fund fees and expenses, dividend costs related to short sales including dividend and borrowing expenses, and extraordinary expenses, such as litigation expenses, if any) to 1.95% of the average daily net assets on Class A shares, 1.67% of the average daily net assets on Advisor Class shares and 1.54% of the average daily net assets on Institutional Class shares. The agreement expires on January 31, 2018. For the period ended March 31, 2017, FIMCO assumed $34,992 under the terms of the agreement. FIMCO and LSF have agreed that any expenses of LSF assumed by FIMCO pursuant to this agreement be repaid to FIMCO by LSF within three years after the date the fee limitation and/or expense reimbursement has been made by FIMCO, provided that such repayment does not cause the expenses of LSF’s Class A shares, Advisor Class shares and Institutional Class shares to exceed the applicable expense ratio in place at the time the expenses are waived or assumed or the current limits established under the expense limitation agreement. For the period December 1, 2016 (commencement of operations) through March 31, 2017, FIMCO assumed $34,992 under the terms of the agreement of which $34,992 expires on September 30, 2020. The expense limitation agreement may be terminated or amended prior to January 31, 2018, with the approval of the Board.
FIMCO has entered into an expense limitation agreement with the Real Estate Fund (“REIT”) to limit REIT’s total annual fund operating expenses (exclusive of interest expenses, taxes, brokerage commissions, acquired fund fees and expenses, dividend costs related to short sales, and extraordinary expenses, such as litigation expenses, if
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any) to 1.45% of the average daily net assets on Class A shares, 1.12% of the average daily net assets on Advisor Class shares and 1.00% of the average daily net assets on Institutional Class shares. The agreement expires on January 31, 2018. For the period ended March 31, 2017, REIT repaid FIMCO $2,328, under the terms of the agreement. FIMCO and REIT have agreed that any expenses of REIT assumed by FIMCO pursuant to this agreement be repaid to FIMCO by REIT within three years after the date the fee limitation and/or expense reimbursement has been made by FIMCO, provided that such repayment does not cause the expenses of REIT’s Class A shares, Advisor Class shares and Institutional Class shares to exceed the applicable expense ratio in place at the time the expenses are waived or assumed or the current limits established under the expense limitation agreement. For the period April 6, 2015 (commencement of operations) through March 31, 2017, FIMCO assumed $164,979 under the terms of the agreement of which $103,949 expires on September 30, 2018 and $61,030 expires on September 30, 2019. The expense limitation agreement may be terminated or amended prior to January 31, 2017, with the approval of the Board.
For the six months ended March 31, 2017, FFS, as underwriter, received from the Income Funds and Equity Funds $3,440,369 and $11,547,815, respectively, in commissions in connection with the sale of shares of the Funds, after allowing $39,365 and $149,907, respectively, to other dealers. For the six months ended March 31, 2017, shareholder servicing costs for the Income Funds and Equity Funds included $1,578,671 and $4,084,574, respectively, in transfer agent fees accrued to FIS, of which FIS voluntarily waived $22,334 on the Government Cash Management Fund.
Pursuant to Distribution Plans adopted under Rule 12b-1 of the 1940 Act, each Fund, other than the Government Cash Management Fund, is authorized to pay FFS a fee up to .30% of the average daily net assets of the Class A shares and 1% of the average daily net assets of the Class B shares on an annualized basis each fiscal year, payable monthly. The Government Cash Management Fund is authorized to pay FFS a fee up to 1% of the average daily net assets of the Class B shares. The fee consists of a distribution fee and a service fee. The service fee is paid for the ongoing servicing of clients who are shareholders of that Fund. For the period ended March 31, 2017, total distribution plan fees accrued to FFS by the Income Funds and Equity Funds amounted to $2,491,840 and $8,345,120, respectively.
Brandywine Global Investment Management, LLC, serves as investment subadviser to International Opportunities Bond Fund. Muzinich & Co., Inc., serves as investment subadviser to Floating Rate Fund and Fund For Income. Ziegler Capital Management, LLC serves as investment subadviser to Covered Call Strategy Fund. Wellington Management Company, LLP serves as investment subadviser to Global Fund and Hedged U.S. Equity Opportunities Fund. Vontobel Asset Management, Inc. serves as
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Notes to Financial Statements (continued)
FIRST INVESTORS INCOME FUNDS
FIRST INVESTORS EQUITY FUNDS
March 31, 2017
investment subadviser to International Fund. Effective December 1, 2016 (commencement of operations), Lazard Asset Management, LLC serves as investment subadviser to Long Short Fund. Smith Asset Management Group, L.P. serves as investment subadviser to Select Growth Fund. The subadvisers are paid by FIMCO and not by the Funds.
4. Restricted Securities—Certain restricted securities are exempt from the registration requirements under Rule 144A of the Securities Act of 1933 and may only be sold to qualified institutional investors. Unless otherwise noted, these 144A securities are deemed to be liquid. At March 31, 2017, the Balanced Income Fund held two 144A securities with an aggregate value of $455,069 representing 1.0% of the Fund’s net assets, Floating Rate Fund held ten 144A securities with an aggregate value of $4,357,586 representing 2.8% of the Fund’s net assets, Fund For Income held one hundred ninety-three 144A securities with an aggregate value of $323,433,125 representing 46.7% of the Fund’s net assets, Government Fund held one 144A security with a value of $5,713,845 representing 1.8% of the Fund’s net assets. International Opportunities Bond Fund held six 144A securities with an aggregate value of $6,770,836 representing 5.3% of the Fund’s net assets, Investment Grade Fund held sixteen 144A securities with an aggregate value of $63,755,089 representing 10.9% of the Fund’s net assets, Limited Duration High Quality Bond Fund held twenty-six 144A securities with an aggregate value of $27,577,578 representing 20.0% of the Fund’s net assets and Total Return Fund held seventeen 144A securities with an aggregate value of $24,818,453 representing 2.8% of the Fund’s net assets. These securities are valued as set forth in Note 1A. Certain restricted securities are exempt from the registration requirements under Section 4(2) of the Securities Act of 1933 and may only be sold to qualified investors. Unless otherwise noted, the Section 4(2) securities are deemed to be liquid. At March 31, 2017, Total Return Fund held six Section 4(2) securities with an aggregate value of $19,392,540 representing 2.2% of the Fund’s net assets.
5. Derivatives—Some of the Funds may invest in various derivatives. A derivative is a financial instrument which has a value that is based on – or “derived from” – the values of other assets, reference rates, or indices. The Funds may invest in derivatives for hedging purposes.
Derivatives may relate to a wide variety of underlying references, such as commodities, stocks, bonds, interest rates, currency exchange rates, and related indices. Derivatives include futures contracts and options on futures contracts, forward-commitment transactions, options on securities, caps, floors, collars, swap contracts, and other financial instruments. Some derivatives, such as futures contracts and certain options, are traded on U.S. commodity and securities exchanges, while other derivatives, such as swap contracts, are privately negotiated and entered into in the over-the-counter
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market (“OTC”). The risks associated with the use of derivatives are different from, and possibly greater than, the risks associated with investing directly in securities and other traditional investments.
The use of a derivative involves the risk that a loss may be sustained as a result of the insolvency or bankruptcy of the other party to the contract (usually referred to as a “counterparty”) or the failure of the counterparty to make required payments or otherwise comply with the terms of the contract. Additionally, the use of credit derivatives can result in losses if FIMCO or the Fund’s subadviser, as applicable, does not correctly evaluate the creditworthiness of the issuer on which the credit derivative is based.
Derivatives may be subject to liquidity risk, which exists when a particular derivative is difficult to purchase or sell. If a derivative transaction is particularly large or if the relevant market is relatively illiquid (as is the case with many OTC derivatives), it may not be possible to initiate a transaction or liquidate a position at an advantageous time or price.
Derivatives may be subject to pricing or “basis” risk, which exists when a particular derivative becomes extraordinarily expensive relative to historical prices or the prices of corresponding cash market instruments. Under certain market conditions, it may not be economically feasible to initiate a transaction or liquidate a position in time to avoid a loss or take advantage of an opportunity.
Because many derivatives have leverage or borrowing components, adverse changes in the value or level of the underlying asset, reference rate, or index can result in a loss substantially greater than the amount invested in the derivative itself. Certain derivatives have the potential for unlimited loss, regardless of the size of the initial investment.
Like most other investments, derivative instruments are subject to the risk that the market value of the instrument will change in a way detrimental to the Funds’ interest. The Funds bear the risk that FIMCO will incorrectly forecast future market trends or the values of assets, reference rates, indices, or other financial or economic factors in establishing derivative positions for the Funds. If FIMCO attempts to use a derivative as a hedge against, or as a substitute for, a portfolio investment, the Funds will be exposed to the risk that the derivative will have or will develop an imperfect or no correlation with the portfolio investment. This could cause substantial losses for the Funds. While hedging strategies involving derivative instruments can reduce the risk of loss, they can also reduce the opportunity for gain or even result in losses by offsetting favorable price movements in other investments. Many derivatives, in particular OTC derivatives, are complex and often valued subjectively. Improper valuations can result in increased cash payment requirements to counterparties or a loss of value to a Fund.
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Notes to Financial Statements (continued)
FIRST INVESTORS INCOME FUNDS
FIRST INVESTORS EQUITY FUNDS
March 31, 2017
The following provides more information on specific types of derivatives and activity in the Funds. The use of derivative instruments by the Funds for the period ended March 31, 2017 was related to the use of written and purchased options.
Options Contracts—Some of the Funds may write covered call and put options on securities, derivative instruments, or currencies the Fund owns or in which it may invest. Writing put options tends to increase a Fund’s exposure to the underlying instrument. Writing call options tends to decrease a Fund’s exposure to the underlying instrument. When a Fund writes a call or put option, an amount equal to the premium received is recorded as a liability and subsequently marked to market to reflect the current value of the option written. These liabilities are reflected as written options outstanding in the Statement of Assets and Liabilities. Payments received or made, if any, from writing options with premiums to be determined on a future date are reflected as such on the Statement of Assets and Liabilities. Premiums received from writing options which expire are treated as realized gains. Premiums received from writing options which are exercised or closed are added to the proceeds or offset against amounts paid on the underlying future, swap, security or currency transaction to determine the realized gain or loss. A Fund, as a writer of an option, has no control over whether the underlying future, swap, security or currency may be sold (call) or purchased (put) and, as a result, bears the market risk of an unfavorable change in the price of the future, swap, security or currency underlying the written option. The risk exists that a Fund may not be able to enter into a closing transaction because of an illiquid market.
Some of the Funds may also purchase put and call options. Purchasing call options tends to increase a Fund’s exposure to the underlying instrument. Purchasing put options tends to decrease a Fund’s exposure to the underlying instrument. A Fund pays a premium which is included in its Statement of Assets and Liabilities as an investment and subsequently marked to market to reflect the current value of the option. Premiums paid for purchasing options which expire are treated as realized losses. The risk associated with purchasing put and call options is limited to the premium paid. Premiums paid for purchasing options which are exercised or closed are added to the amounts paid or offset against the proceeds on the underlying future, swap, security or currency transaction to determine the realized gain or loss.
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The premium amount and the number of option contracts written and purchased by the Funds during the six months ended March 31, 2017, were as follows:
| Covered Call Strategy | Equity Income | Hedged U.S. Equity Opportunities | ||||||||||||||||||
| Number of | Premium | Number of | Premium | Number of | Premium | Number of | Premium | |||||||||||||
| Contracts | Amount | Contracts | Amount | Contracts | Amount | Contracts | Amount | |||||||||||||
| Options outstanding at | ||||||||||||||||||||
| beginning of period | (13,914) | $ | (2,150,687) | — | $ | — | 45 | $ | 237,357 | (34) | $ | (89,006) | ||||||||
| Put options written | — | — | — | — | — | — | (130) | (401,160) | ||||||||||||
| Put options purchased | ||||||||||||||||||||
| to cover | — | — | — | — | — | — | 45 | 124,743 | ||||||||||||
| Put options expirations | — | — | — | — | — | — | 18 | 34,456 | ||||||||||||
| Call options written | (121,164) | (15,925,405) | (2,525) | (246,839) | (23) | (137,270) | — | — | ||||||||||||
| Call options exercised | 2,785 | 428,980 | 1,440 | 152,370 | — | — | — | — | ||||||||||||
| Call options purchased | ||||||||||||||||||||
| to cover | 85,974 | 11,735,798 | — | — | 108 | 685,468 | — | — | ||||||||||||
| Call options expirations | 16,901 | 1,866,473 | 1,035 | 91,609 | (29) | (117,959) | — | — | ||||||||||||
| Balance at | ||||||||||||||||||||
| March 31, 2017 | (29,418) | $ | (4,044,841) | (50) | $ | (2,860) | 101 | $ | 667,596 | (101) | $ | (330,967) | ||||||||
Derivative Investment Holdings Categorized by Risk Exposure —The following table sets forth the fair value and the location in the Statement of Assets and Liabilities of the Funds’ derivative contracts by primary risk exposure as of March 31, 2017:
| Asset derivatives | Liability Derivatives | ||||||
| Statements of Assets | Statements of Assets | ||||||
| Risk exposure category | and Liabilities Location | Value | and Liabilities Location | Value | |||
| Equity Contracts: | |||||||
| Covered Call Strategy | N/A | N/A | Written options, at value | $ | 2,736,462 | ||
| Equity Income | N/A | N/A | Written options, at value | $ | 350 | ||
| Hedged U.S. Equity | |||||||
| Opportunities | N/A | N/A | Written options, at value | $ | 149,367 | ||
The following table sets forth the Funds’ realized gain (loss), as reflected in the Statement of Operations, by primary risk exposure and by type of derivative contract for the six months ended March 31, 2017:
| Risk exposure category | Written options | ||||
| Equity Contracts: | |||||
| Covered Call Strategy | $ | (5,299,842) | |||
| Equity Income | $ | 114,605 | |||
| Hedged U.S. Equity | |||||
| Opportunities | $ | (1,540,799) | |||
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Notes to Financial Statements (continued)
FIRST INVESTORS INCOME FUNDS
FIRST INVESTORS EQUITY FUNDS
March 31, 2017
The following table sets forth the Funds’ change in unrealized appreciation (depreciation) by primary risk exposure and by type of derivative contract for the six months ended March 31, 2017:
| Hedged | |||||||
| Covered Call | U.S. Equity | ||||||
| Risk exposure category | Strategy | Equity Income | Opportunities | ||||
| Option contracts | $1,223,480 | $2,510 | $(96,806) |
Interest Rate Futures Contracts—The Funds may enter into interest rate futures contracts on U.S. Treasury obligations and options thereon that are traded on a U.S. exchange. An interest rate futures contract provides for the future sale by one party and the purchase by another party of a specified amount of a particular financial instrument (debt security) at a specified price, date, time and place. Such investments may be used for, among other purposes, the purpose of hedging against changes in the value of a Fund’s portfolio securities due to anticipated changes in interest rates and market conditions. A public market exists for interest rate futures contracts covering a number of debt securities, including long-term U.S. Treasury Bonds, 10-year U.S. Treasury Notes and three-month U.S. Treasury Bills. No price is paid upon entering into futures contracts. Instead, upon entering into a futures contract, a Fund is required to deposit with its custodian in a segregated account in the name of the futures broker through which the transaction is effected an amount of cash or U.S. Government securities generally equal to 3%-5% or less of the contract value. This amount is known as “initial margin.”
An option on an interest rate futures contract generally gives the purchaser the right, in return for the premium paid, to assume a position in a futures contract at a specified exercise price at any time prior to the expiration date of the option. The Funds may purchase put and call options on interest rate futures contracts on U.S. Treasury obligations which are traded on a U.S. exchange as a hedge against changes in interest rates, and may enter into closing transactions with respect to such options to terminate existing positions. There is no guarantee such closing transactions can be effected. When writing a call or put option on a futures contract, margin also must be deposited in accordance with applicable exchange rules. Initial margin on futures contracts is in the nature of a performance bond or good-faith deposit that is returned to a Fund upon termination of the transaction, assuming all obligations have been satisfied. Under certain circumstances, such as periods of high volatility, a Fund may be required by an exchange to increase the level of its initial margin payment. Subsequent payments, called “variation margin,” to and from the broker, are made on
| 238 |
a daily basis as the value of the futures position varies, a process known as “marking to market.” Variation margin does not involve borrowing to finance the futures transactions, but rather represents a daily settlement of a Fund’s obligation to or from a clearing organization. A Fund is also obligated to make initial and variation margin payments when it writes options on futures contracts.
To the extent that a Fund participates in the futures or options markets, it will incur investment risks and transaction costs to which it would not be subject absent the use of these strategies. The use of these strategies involves certain special risks, including: (1) dependence on the ability of the Funds’ investment adviser, FIMCO, or a Fund’s subadviser, as applicable, to predict correctly movements in the direction of interest rates and securities prices; (2) imperfect correlation between the price of futures contracts and options thereon and movements in the prices of the securities or currencies being hedged; (3) the fact that skills needed to use these strategies are different from those needed to select portfolio securities; (4) the leverage (if any) that is created by investing in the option or futures contract; and (5) the possible absence of a liquid secondary market for any particular instrument at any time. If FIMCO’s prediction of movements in the direction of the securities and interest rate markets is inaccurate, the adverse consequences to that Fund may leave it in a worse position than if such strategies were not used. Derivatives may be difficult to sell, unwind or value.
The amount of realized gains (losses) on futures contracts recognized by the Funds in the accompanying Statement of Operations for the six months March 31, 2017 are summarized in the following table:
| Statement of Operations | ||||||||
| Realized | ||||||||
| Futures Contracts | Gain (Loss) | |||||||
| Balanced Income | $ | 224,027 | ||||||
| Strategic Income | $ | (67,146) | ||||||
| Hedged U.S. Equity | ||||||||
| Opportunities | $ | (2,958) | ||||||
| 239 |
Notes to Financial Statements (continued)
FIRST INVESTORS INCOME FUNDS
FIRST INVESTORS EQUITY FUNDS
March 31, 2017
The following table summarizes the value of the Funds’ futures contracts held as of March 31, 2017, and the related location in the accompanying Statement of Assets and Liabilities.
| Statement of | ||||||||
| Operations Location | ||||||||
| Unrealized appreciation | ||||||||
| (depreciation) in value | ||||||||
| Futures Contracts | of investments | |||||||
| Balanced Income | $ | (10,200) | ||||||
| Hedged U.S. Equity | ||||||||
| Opportunities | $ | 67,290 | ||||||
Short Sales—The Long Short Fund may sell securities short. A short sale is a transaction in which a Fund sells securities it does not own but has borrowed in anticipation of a decline in the market price of the securities. The initial amount of a short sale is recorded as a liability which is marked-to-market daily. Fluctuations in the value of the short liability are recorded as unrealized gains or losses. The Fund realizes a gain or loss upon closing of the short sale (returning the security to the counterparty by way of purchase or delivery of a long position owned). Short sales by the Fund involves certain risks and special considerations. Possible losses from short sales differ from losses that could be incurred from a purchase of a security because losses from short sales may be unlimited, whereas losses from purchases cannot exceed the total amount invested. The use of short sales may also involve counterparty risk and leverage risk. The Fund is liable to the buyer for any dividends payable on securities while those securities are in a short position. These dividends are an expense of the Fund. The Fund designates collateral consisting of cash, U.S. Government securities or other liquid assets sufficient to collateralize the market value of short positions.
Proceeds from short sales are generally retained in cash accounts or invested in securities that are cash equivalents. With regard to securities borrowed as of March 31, 2017 pursuant to short sale arrangements, the Fund has a right to set off any assets held (including the borrowed securities) or obligations owed to the lender, in the event of the lender’s default, against any obligations owed by the lender to the Funds under any agreement or collateral document, including the collateral value of the Securities Loan Collateral, as that term is defined in the Securities Lending and Services Agreement between the Fund and the lender. At March 31, 2017, Long Short Fund had pledged $8,800,651 of securities as collateral under such arrangement.
For the six months ended March 31, 2017, the Long Short Fund received proceeds from securities sold short and paid funds for securities purchased to cover short positions in the amounts of $12,792,673 and $4,677,055, respectively.
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Foreign Exchange Contracts—The International Opportunities Bond Fund, Global Fund and Hedged U.S. Equity Opportunities Fund may enter into foreign exchange contracts for the purchase or sale of foreign currencies at negotiated rates at future dates. These contracts are considered derivative instruments and a Fund may invest in them in order to hedge its currency exposure in bond positions or to gain currency exposure held by the Fund. A fund could be exposed to risk if counterparties to the contracts are unable to meet the terms of their contracts or if the value of the foreign currency changes unfavorably. Foreign exchange contracts are “marked-to-market” daily at the applicable translation rate and the resulting unrealized gains and losses are reflected in the Funds’ assets. During the period, the Funds used currency forwards to hedge currency exposure from certain bonds as well as to gain currency exposure in certain countries.
The Funds had the following foreign exchange contracts open at March 31, 2017:
| International Opportunities Bond | ||||||||||||
| Unrealized | ||||||||||||
| Settlement | Foreign | Receive | Appreciation | |||||||||
| Counterparty | Date | Currency | (Deliver) | Asset | Liability | (Depreciation) | ||||||
| HSBC | 4/10/17 | NOK | 46,000,000 | $ 5,357,434 | $ 5,354,098 | $ 3,336 | ||||||
| MSD | 4/21/17 | NZD | (4,080,000) | (2,902,328) | (2,860,087) | 42,241 | ||||||
| MSD | 4/21/17 | NZD | 2,050,000 | 1,437,054 | 1,441,610 | (4,556) | ||||||
| HSBC | 4/24/17 | SEK | 19,300,000 | 2,153,862 | 2,175,714 | (21,852) | ||||||
| JPM | 5/2/17 | JPY | 963,000,000 | 8,649,960 | 8,509,698 | 140,262 | ||||||
| NAB | 5/2/17 | JPY | 44,000,000 | 395,221 | 397,487 | (2,266) | ||||||
| CITI | 5/10/17 | EUR | (4,650,000) | (4,987,036) | (4,960,635) | 26,401 | ||||||
| HSBC | 5/15/17 | NOK | 22,900,000 | 2,667,070 | 2,751,015 | (83,945) | ||||||
| MSD | 5/15/17 | NOK | 3,300,000 | 384,338 | 388,607 | (4,269) | ||||||
| MSD | 5/17/17 | AUD | 4,730,000 | 3,613,721 | 3,603,787 | 9,934 | ||||||
| HSBC | 5/17/17 | AUD | 880,000 | 672,320 | 672,566 | (246) | ||||||
| CITI | 5/17/17 | AUD | (500,000) | (380,740) | (382,000) | (1,260) | ||||||
| HSBC | 6/5/17 | SEK | 50,700,000 | 5,658,072 | 5,627,300 | 30,772 | ||||||
| JPM | 6/5/17 | SEK | 2,000,000 | 223,198 | 227,369 | (4,171) | ||||||
| CITI | 6/9/17 | GBP | 14,400,000 | 18,041,722 | 17,696,088 | 345,634 | ||||||
| BCI | 6/21/17 | INR | 290,000,000 | 4,466,004 | 4,304,491 | 161,513 | ||||||
| BCI | 6/21/17 | INR | 70,000,000 | 1,078,001 | 1,062,215 | 15,786 | ||||||
| Net Unrealized gain on open foreign exchange contracts | $653,314 | |||||||||||
| 241 |
Notes to Financial Statements (continued)
FIRST INVESTORS INCOME FUNDS
FIRST INVESTORS EQUITY FUNDS
March 31, 2017
| Global | ||||||||||||
| Unrealized | ||||||||||||
| Settlement | Foreign | Receive | Appreciation | |||||||||
| Counterparty | Date | Currency | (Deliver) | Asset | Liability | (Depreciation) | ||||||
| GS | 7/14/17 | EUR | (31,346,000) | ($33,664,350) | ($33,440,014) | $224,336 | ||||||
| GS | 7/14/17 | EUR | 6,474,000 | 6,906,484 | 6,928,604 | (22,120) | ||||||
| Net Unrealized gain on open foreign exchange contracts | $202,216 | |||||||||||
| Hedged U.S. Equity Opportunities | ||||||||||||
| Settlement | Foreign | Receive | Unrealized | |||||||||
| Counterparty | Date | Currency | (Deliver) | Asset | Liability | Depreciation | ||||||
| BNP | 6/21/17 | JPY | (8,518,000) | ($75,042) | ($76,511) | $(1,469) | ||||||
| CITI | 6/21/17 | EUR | (89,000) | (94,458) | (94,945) | (487) | ||||||
| Net Unrealized loss on open foreign exchange contracts | $(1,956) | |||||||||||
A summary of abbreviations for foreign currency appears at the end of the International Opportunities Bond Fund’s portfolio of investments.
A summary of abbreviations for counterparties to foreign exchange contracts are as follows:
| BCI | Barclays Capital, Inc. | HSBC | HSBC Bank USA N.A. |
| BNP | BNP Paribas SA | JPM | J.P. Morgan Securities, Inc. |
| CITI | Citigroup Global Markets | MSD | Morgan Stanley |
| GS | Goldman Sachs & Co. | NAB | National Australia Bank |
Disclosures about Offsetting Assets and Liabilities —Disclosures about Offsetting Assets and Liabilities requires an entity to disclose information about offsetting and related arrangements to enable users of its financial statements to understand the effect of those arrangements on its financial position. The guidance requires retrospective application for all comparative periods presented.
A Fund may mitigate credit risk with respect to OTC derivative counterparties through credit support annexes included with an International Swaps and Derivatives Association, Inc. Master Agreements or other Master Netting Agreements which are the standard contracts governing most derivative transactions between the Fund and each of its counterparties. These agreements may allow the Fund and each counterparty to offset certain derivative financial instruments’ payables and/or receivables against each other and/or with collateral, which is generally held by the Fund’s custodian. The amount of collateral moved to/from applicable counterparties is based upon minimum transfer
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amounts specified in the agreement. To the extent amounts due to the Fund from its counterparties are not fully collateralized contractually or otherwise, the Fund bears the risk of loss from counterparty non-performance.
The Funds’ Statement of Assets and Liabilities (“SOAL”) presents financial instruments on a gross basis, therefore there are no net amounts and no offset amounts within the SOAL to present below. Gross amounts of the financial instruments, amounts related to financial instruments/cash collateral not offset in the SOAL and net amounts are presented below:
| International Opportunities Bond | ||||||||
| Description/Financial | Gross Amounts | |||||||
| Instrument/Statement | Presented in | |||||||
| of Assets and Liabilities | Statement of Assets | Financial | ||||||
| Category | Counterparty | and Liabilities | Instruments* | Net Amount | ||||
| Unrealized gain (loss) on | ||||||||
| foreign exchange contracts | BCI | $ 177,299 | $ — | $177,299 | ||||
| CITI | 372,035 | (1,260) | 370,775 | |||||
| HSBC | 34,108 | (106,043) | (71,935) | |||||
| JPM | 140,262 | (4,171) | 136,091 | |||||
| MSD | 52,175 | (8,825) | 43,350 | |||||
| NAB | — | (2,266) | (2,266) | |||||
| Total | $775,879 | $(122,565) | $653,314 | |||||
| Unrealized loss on foreign | ||||||||
| exchange contracts | CITI | $ (1,260) | $ 1,260 | $ — | ||||
| HSBC | (106,043) | 106,043 | — | |||||
| JPM | (4,171) | 4,171 | — | |||||
| MSD | (8,825) | 8,825 | — | |||||
| NAB | (2,266) | 2,266 | — | |||||
| Total | $(122,565) | $ 122,565 | $ — | |||||
| Global Fund | ||||||||
| Description/Financial | Gross Amounts | |||||||
| Instrument/Statement | Presented in | |||||||
| of Assets and Liabilities | Statement of Assets | Financial | ||||||
| Category | Counterparty | and Liabilities | Instruments* | Net Amount | ||||
| Unrealized gain (loss) on | ||||||||
| foreign exchange contracts | GS | $224,336 | $(22,120) | $202,216 | ||||
| Unrealized gain (loss) on | ||||||||
| foreign exchange contracts | GS | $(22,120) | $ 22,120 | $ — |
| 243 |
Notes to Financial Statements (continued)
FIRST INVESTORS INCOME FUNDS
FIRST INVESTORS EQUITY FUNDS
March 31, 2017
| Hedged U.S. Equity Opportunities | ||||||||
| Description/Financial | Gross Amounts | |||||||
| Instrument/Statement | Presented in | |||||||
| of Assets and Liabilities | Statement of Assets | Financial | ||||||
| Category | Counterparty | and Liabilities | Instruments* | Net Amount | ||||
| Unrealized gain (loss) on | ||||||||
| foreign exchange contracts | BNP | $ — | $(1,469) | $(1,469) | ||||
| CITI | — | (487) | (487) | |||||
| Total | $ — | $(1,956) | $(1,956) | |||||
| Unrealized loss on foreign | ||||||||
| exchange contracts | BNP | $(1,469) | $ 1,469 | $ — | ||||
| CITI | (487) | 487 | — | |||||
| Total | $(1,956) | $ 1,956 | $ — | |||||
| * | Amounts related to master netting arrangements (for example, ISDA) which have been determined by the |
| Fund to be legally enforceable in the event of default and where certain other criteria are met in accordance | |
| with applicable offsetting accounting guidance. |
During the six months ended March 31, 2017, the volume of derivative activity for the Funds based on average monthly market values for forward foreign currency contracts (to buy) and for forward foreign currency contracts (to sell) were as follows:
| Forward Foreign Currency Contracts | |||||||
| (to Buy) | (to Sell) | ||||||
| International Opportunities Bond | $17,406,812 | $17,315,641 | |||||
| Global | — | — | |||||
| Hedged U.S. Equity Opportunities | 168,728 | 165,770 | |||||
Fair Value of Derivative Instruments—The fair value of derivative instruments held by the Funds as of March 31, 2017, was as follows:
| Assets Derivatives | Liability Derivatives | |||||||
| Derivatives not accounted | ||||||||
| for as hedging instruments | Statements of Assets | Statements of Assets | ||||||
| under ASC 815 | and Liabilities Location | and Liabilities Location | ||||||
| Unrealized appreciation | Unrealized depreciation | |||||||
| of foreign exchange | of foreign exchange | |||||||
| Foreign exchange contracts: | contracts | Value | contracts | Value | ||||
| International Opportunities | ||||||||
| Bond | $ | 775,879 | $ | (122,565) | ||||
| Global | $ | 224,336 | $ | (22,120) | ||||
| Hedged U.S. Equity | ||||||||
| Opportunities | $ | — | $ | (1,956) | ||||
| 244 |
The effect of the Funds’ derivative instruments on the Statement of Operations are as follows:
| Amount of Realized Gain (Loss) Recognized on Derivatives | ||||
| Derivatives not accounted | Net Realized Gain (Loss) | |||
| for as hedging instruments | on Foreign Exchange | |||
| under ASC 815 | Transactions | |||
| Foreign exchange transactions: | ||||
| International Opportunities Bond | $ | (723,676) | ||
| Global | $ | (44,606) | ||
| Hedged U.S. Equity Opportunities | $ | 485 | ||
| Amount of Change in Unrealized Appreciation (Depreciation) Recognized on Derivatives | ||||
| Derivatives not accounted | Net Unrealized Appreciation | |||
| for as hedging instruments | (Depreciation) on Foreign | |||
| under ASC 815 | Exchange Transactions | |||
| Foreign exchange transactions: | ||||
| International Opportunities Bond | $ | 218,470 | ||
| Global | $ | 203,820 | ||
| Hedged U.S. Equity Opportunities | $ | (1,854) | ||
6. High Yield Credit Risk—The investments of Floating Rate Fund and Fund For Income in high yield securities, whether rated or unrated, may be considered speculative and subject to greater market fluctuations and risks of loss of income and principal than lower-yielding, higher-rated, fixed-income securities. The risk of loss due to default by the issuer may be significantly greater for holders of high-yielding securities, because such securities are generally unsecured and are often subordinated to other creditors of the issuer.
7. Capital—The Trusts are authorized to issue an unlimited number of shares of beneficial interest without par value. The Trusts consist of the Funds listed on the cover page, each of which is a separate and distinct series of the Trusts. Each Fund has designated four classes of shares, Class A, Class B, Advisor Class and Institutional Class shares (each, a “Class”) except for Government Cash Management Fund which has designated only Class A, Class B and Institutional Class shares, Strategic Income Fund which has designated only Class A and Advisor Class shares and Balanced Income Fund, Floating Rate Fund, International Opportunities Bond Fund, Limited Duration High Quality Bond Fund, Long Short Fund and Real Estate Fund which have designated only Class A, Advisor Class and Institutional Class shares. Advisor Class
| 245 |
Notes to Financial Statements (continued)
FIRST INVESTORS INCOME FUNDS
FIRST INVESTORS EQUITY FUNDS
March 31, 2017
and Institutional Class shares became available for sale to the public in May 2013 and October 2013, respectively. Not all classes of shares of each Fund may be available in all jurisdictions. Each share of each Class has an equal beneficial interest in the assets, has identical voting, dividend, liquidation and other rights and is subject to the same terms and conditions except that expenses allocated to a Class may be borne solely by that Class as determined by the Board and a Class may have exclusive voting rights with respect to matters affecting only that Class. Government Cash Management Fund’s Class A, Class B and Institutional Class shares are sold without an initial sales charge; however, its Class B shares may only be acquired through an exchange of Class B shares from another First Investors eligible Fund or through the reinvestment of dividends on Class B shares and are generally subject to a contingent deferred sales charge at the rate of 4% in the first year and declining to 0% over a six-year period, which is payable to FFS as underwriter of the Trusts. The shares sold by the other Funds have a public offering price that reflects different sales charges and expense levels. Class A shares are sold with an initial sales charge of up to 5.75% of the amount invested and together with the Class B shares are subject to distribution plan fees as described in Note 3. Class B shares are sold without an initial sales charge, but are generally subject to a contingent deferred sales charge which declines in steps from 4% to 0% over a six-year period. Class B shares automatically convert into Class A shares after eight years. There are no sales charges associated with the purchase of Advisor Class and Institutional Class shares. Realized and unrealized gains or losses, investment income and expenses (other than distribution plan fees and shareholder servicing costs) are allocated daily to each class of shares based upon the relative proportion of net assets to each class.
8. Litigation—The Blue Chip and Equity Income Funds have been named, and have received notice that they may be putative members of the proposed defendant class of shareholders, in a lawsuit filed in the United States Bankruptcy Court for the District of Delaware on November 1, 2010, by the Official Committee of Unsecured Creditors of Tribune Company (the “Committee”). The Committee is seeking to recover all payments made to beneficial owners of common stock in connection with a leveraged buyout of the Tribune Company (“LBO”), including payments made in connection with a 2007 tender offer into which the Blue Chip and Equity Income Funds tendered their shares of common stock of the Tribune Company. On December 9, 2011, the Blue Chip Fund was reorganized into the Growth & Income Fund pursuant to a Plan of Reorganization and Termination, whereby all of the assets of the Blue Chip Fund were transferred to the Growth & Income Fund, the Growth & Income Fund assumed all of the liabilities of the Blue Chip Fund, including any contingent liabilities with respect to pending or threatened litigation or actions, and shareholders of Blue Chip Fund became shareholders of Growth & Income Fund. The adversary proceeding brought
| 246 |
by the Committee has been transferred to the Southern District of New York and administratively consolidated with other similar suits as discussed below. In addition, on June 2, 2011, the Blue Chip and Equity Income Funds were named as defendants in a lawsuit brought in connection with the Tribune Company’s LBO by Deutsche Bank Trust Company Americas, in its capacity as successor indenture trustee for a certain series of Senior Notes, Law Debenture Trust Company of New York, in its capacity as successor indenture trustee for a certain series of Senior Notes, and Wilmington Trust Company, in its capacity as successor indenture trustee for the PHONES Notes (together, the “Bondholder Plaintiffs”) in the Supreme Court of the State of New York. The Blue Chip and Equity Income Funds have also been named in a similar suit filed on behalf of participants in Tribune defined-compensation plans (the “Retiree Plaintiffs”). As with the Bondholder Plaintiffs and the Committee, the Retiree Plaintiffs seek to recover payments of the proceeds of the LBO. (All of these suits have been removed to the United States District Court for the Southern District of New York and administratively consolidated with other substantially similar suits against other former Tribune shareholders (the “MDL Proceeding”)). On September 23, 2013, the Judge in the MDL Proceeding dismissed various state law constructive fraudulent transfer suits, resulting in the Funds being dismissed from the Bondholder and Retiree Plaintiffs’ actions. On September 30, 2013, counsel for the plaintiffs in those suits appealed the MDL Judge’s dismissal ruling to the Second Circuit. On March 24, 2016, the Second Circuit Court of Appeals affirmed the MDL Judge’s dismissal of the various state law constructive fraudulent transfer suits. In September 2016, the Bondholder and Plaintiffs petitioned the U.S. Supreme Court to review the Second Circuit’s decision. The Supreme Court has not yet ruled on that request. On January 9, 2017, the Tribune MDL judge granted the defendants’ motion to dismiss the Committee lawsuit alleging a single claim for intentional fraudulent transfer. An appeal of that decision to the Second Circuit is expected, but has not yet been made. The extent of the Funds’ potential liability in any such actions has not been determined. The Funds have been advised by counsel that the Funds could be held liable to return all or part of the proceeds received in any of these actions, as well as interest and court costs, even though the Funds had no knowledge of, or participation in, any misconduct. The Equity Income Fund received proceeds of $1,526,566 in connection with the LBO, representing 0.24% of its net assets as of March 31, 2017. The Blue Chip Fund received proceeds of $790,772 in connection with the LBO, representing 0.04% of the net assets of Growth & Income Fund as of March 31, 2017. The Equity Income and Growth & Income Funds cannot predict the outcomes of these proceedings, and thus have not accrued any of the amounts sought in the various actions in the accompanying financial statements.
| 247 |
Notes to Financial Statements (continued)
FIRST INVESTORS INCOME FUNDS
FIRST INVESTORS EQUITY FUNDS
March 31, 2017
9. Subsequent Events—Subsequent events occurring after March 31, 2017 have been evaluated for potential impact to this report through the date the financial statements were issued. There were no subsequent events to report that would have a material impact on the Funds’ financial statements.
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| 249 |
Financial Highlights
FIRST INVESTORS INCOME FUNDS
The following table sets forth the per share operating performance data for a share outstanding,
total return, ratios to average net assets and other supplemental data for each fiscal year ended
September 30 unless otherwise indicated.
| PER SHARE DATA | RATIOS / SUPPLEMENTAL DATA | ||||||||||||||||||||||||||||||||
| Ratio to Average Net | |||||||||||||||||||||||||||||||||
| Less Distributions | Ratio to Average | Assets Before Expenses | |||||||||||||||||||||||||||||||
| Investment Operations | from | Net Assets** | Waived or Assumed | ||||||||||||||||||||||||||||||
| Net Asset | Net Realized | Net Asset | |||||||||||||||||||||||||||||||
| Value, | Net | and Unrealized | Total from | Net | Net | Value, | Net Assets | Net Expenses | Net Expenses | Net | Net | Portfolio | |||||||||||||||||||||
| Beginning | Investment | Gain (Loss) on | Investment | Investment | Realized | Total | End of | Total | End of Period | After Fee | Before Fee | Investment | Investment | Turnover | |||||||||||||||||||
| of Period | Income | Investments | Operations | Income | Gain | Distributions | Period | Return* | (in thousands) | Credits | Credits*** | Income | Expenses*** | Income | Rate | ||||||||||||||||||
| BALANCED INCOME FUND | |||||||||||||||||||||||||||||||||
| Class A | |||||||||||||||||||||||||||||||||
| 2016(f) | $10.00 | $.17 | (c) | $.68 | $ .85 | $.15 | $ — | $.15 | $10.70 | 8.55 | % | $29,676 | 1.15 | % | 1.15 | % | 1.61 | % | 2.21 | % | .55 | % | 57 | % | |||||||||
| 2017(l) | 10.70 | .09 | (c) | .06 | .15 | .12 | .01 | .13 | 10.72 | 1.39 | †† | 43,758 | 1.15 | † | 1.15 | † | 1.62 | † | 1.58 | † | 1.19 | † | 27 | †† | |||||||||
| Advisor Class | |||||||||||||||||||||||||||||||||
| 2016(f) | 10.00 | .20 | (c) | .69 | .89 | .16 | — | .16 | 10.73 | 8.97 | 109 | .82 | .82 | 1.91 | 1.98 | .75 | 57 | ||||||||||||||||
| 2017(l) | 10.73 | .11 | (c) | .04 | .15 | .12 | .01 | .13 | 10.75 | 1.44 | †† | 111 | .82 | † | .82 | † | 1.95 | † | 1.14 | † | 1.63 | † | 27 | †† | |||||||||
| Institutional Class | |||||||||||||||||||||||||||||||||
| 2016(f) | 10.00 | .21 | (c) | .69 | .90 | .17 | — | .17 | 10.73 | 9.08 | 157 | .69 | .69 | 2.04 | 1.93 | .80 | 57 | ||||||||||||||||
| 2017(l) | 10.73 | .12 | (c) | .05 | .17 | .13 | .01 | .14 | 10.76 | 1.59 | †† | 242 | .69 | † | .69 | † | 2.08 | † | 1.15 | † | 1.62 | † | 27 | †† | |||||||||
| FLOATING RATE FUND | |||||||||||||||||||||||||||||||||
| Class A | |||||||||||||||||||||||||||||||||
| 2014(h) | $10.00 | $.21 | (c) | $(.10 | ) | $ .11 | $.23 | — | $.23 | $9.88 | 1.12 | %†† | $50,361 | 1.10 | %† | 1.10 | %† | 2.21 | %† | 1.58 | %† | 1.73 | %† | 26 | %†† | ||||||||
| 2015 | 9.88 | .26 | (c) | (.27 | ) | (.01 | ) | .29 | — | .29 | 9.58 | (.08 | ) | 57,101 | 1.10 | 1.10 | 2.72 | 1.33 | 2.49 | 49 | |||||||||||||
| 2016 | 9.58 | .27 | (c) | .09 | .36 | .28 | — | .28 | 9.66 | 3.69 | 61,243 | 1.10 | 1.10 | 2.86 | 1.27 | 2.69 | 38 | ||||||||||||||||
| 2017(l) | 9.66 | .15 | (c) | .02 | .17 | .16 | — | .16 | 9.67 | 1.86 | †† | 65,660 | 1.10 | † | 1.10 | † | 3.22 | † | 1.28 | † | 3.04 | † | 35 | †† | |||||||||
| Advisor Class | |||||||||||||||||||||||||||||||||
| 2014(h) | 10.00 | .25 | (c) | (.11 | ) | .14 | .26 | — | .26 | 9.88 | 1.43 | †† | 34,942 | .90 | † | .90 | † | 2.63 | † | .95 | † | 2.58 | † | 26 | †† | ||||||||
| 2015 | 9.88 | .28 | (c) | (.26 | ) | .02 | .32 | — | .32 | 9.58 | .18 | 50,122 | .90 | .90 | 2.92 | 1.03 | 2.79 | 49 | |||||||||||||||
| 2016 | 9.58 | .29 | (c) | .08 | .37 | .30 | — | .30 | 9.65 | 3.92 | 61,844 | .90 | .90 | 3.06 | .98 | 2.98 | 38 | ||||||||||||||||
| 2017(l) | 9.65 | .16 | (c) | .03 | .19 | .17 | — | .17 | 9.67 | 1.96 | †† | 67,604 | .90 | † | .90 | † | 3.42 | † | .99 | † | 3.33 | † | 35 | †† | |||||||||
| Institutional Class | |||||||||||||||||||||||||||||||||
| 2014(h) | 10.00 | .27 | (c) | (.13 | ) | .14 | .28 | — | .28 | 9.86 | 1.36 | †† | 5,329 | .70 | † | .70 | † | 2.76 | † | 1.06 | † | 2.40 | † | 26 | †† | ||||||||
| 2015 | 9.86 | .30 | (c) | (.25 | ) | .05 | .34 | — | .34 | 9.57 | .47 | 10,458 | .70 | .70 | 3.17 | .90 | 2.97 | 49 | |||||||||||||||
| 2016 | 9.57 | .31 | (c) | .08 | .39 | .32 | — | .32 | 9.64 | 4.14 | 11,456 | .70 | .70 | 3.27 | .83 | 3.14 | 38 | ||||||||||||||||
| 2017(l) | 9.64 | .17 | (c) | .03 | .20 | .18 | — | .18 | 9.66 | 2.05 | †† | 20,263 | .70 | † | .70 | † | 3.52 | † | .86 | † | 3.36 | † | 35 | †† | |||||||||
| 250 | 251 |
Financial Highlights (continued)
FIRST INVESTORS INCOME FUNDS
| PER SHARE DATA | RATIOS / SUPPLEMENTAL DATA | |||||||||||||||||||||||||||||||||
| Ratio to Average Net | ||||||||||||||||||||||||||||||||||
| Assets Before Expenses | ||||||||||||||||||||||||||||||||||
| Less Distributions | Ratio to Average | Waived, Assumed | ||||||||||||||||||||||||||||||||
| Investment Operations | from | Net Assets** | or Reimbursed | |||||||||||||||||||||||||||||||
| Net Asset | Net Realized | Net Asset | ||||||||||||||||||||||||||||||||
| Value, | Net | and Unrealized | Total from | Net | Net | Value, | Net Assets | Net Expenses | Net Expenses | Net | Net | Portfolio | ||||||||||||||||||||||
| Beginning | Investment | Gain (Loss) on | Investment | Investment | Realized | Total | End of | Total | End of Period | After Fee | Before Fee | Investment | Investment | Turnover | ||||||||||||||||||||
| of Period | Income | Investments | Operations | Income | Gain | Distributions | Period | Return* | (in thousands) | Credits | Credits*** | Income | Expenses*** | Income | Rate | |||||||||||||||||||
| FUND FOR INCOME | ||||||||||||||||||||||||||||||||||
| Class A | ||||||||||||||||||||||||||||||||||
| 2012 | $2.35 | $.16 | $ .25 | $ .41 | $.16 | — | $.16 | $2.60 | 17.79 | % | $602,370 | 1.26 | % | 1.26 | % | 6.01 | % | 1.29 | % | 5.98 | % | 54 | % | |||||||||||
| 2013 | 2.60 | .15 | (.01 | ) | .14 | .15 | — | .15 | 2.59 | 5.55 | 647,603 | 1.23 | 1.23 | 5.17 | 1.25 | 5.15 | 60 | |||||||||||||||||
| 2014 | 2.59 | .12 | (c) | .02 | .14 | .14 | — | .14 | 2.59 | 5.38 | 621,618 | 1.21 | 1.21 | 4.67 | 1.23 | 4.65 | 47 | |||||||||||||||||
| 2015 | 2.59 | .11 | (c) | (.18 | ) | (.07 | ) | .13 | — | .13 | 2.39 | (2.85 | ) | 567,249 | 1.21 | 1.21 | 4.39 | 1.23 | 4.37 | 47 | ||||||||||||||
| 2016 | 2.39 | .11 | (c) | .10 | .21 | .12 | — | .12 | 2.48 | 9.07 | 571,028 | 1.22 | 1.22 | 4.76 | 1.24 | 4.74 | 55 | |||||||||||||||||
| 2017(l) | 2.48 | .06 | (c) | .01 | .07 | .06 | — | .06 | 2.49 | 2.86 | †† | 566,201 | 1.21 | † | 1.21 | † | 4.57 | † | 1.23 | † | 4.55 | † | 33 | †† | ||||||||||
| Class B | ||||||||||||||||||||||||||||||||||
| 2012 | 2.35 | .13 | .26 | .39 | .14 | — | .14 | 2.60 | 17.01 | 5,659 | 1.96 | 1.96 | 5.31 | 1.99 | 5.28 | 54 | ||||||||||||||||||
| 2013 | 2.60 | .13 | (.01 | ) | .12 | .13 | — | .13 | 2.59 | 4.84 | 5,001 | 1.99 | 1.99 | 4.42 | 2.01 | 4.40 | 60 | |||||||||||||||||
| 2014 | 2.59 | .10 | (c) | .02 | .12 | .12 | — | .12 | 2.59 | 4.67 | 4,690 | 2.02 | 2.02 | 3.86 | 2.04 | 3.84 | 47 | |||||||||||||||||
| 2015 | 2.59 | .09 | (c) | (.18 | ) | (.09 | ) | .11 | — | .11 | 2.39 | (3.65 | ) | 3,376 | 2.01 | 2.01 | 3.60 | 2.03 | 3.58 | 47 | ||||||||||||||
| 2016 | 2.39 | .09 | (c) | .10 | .19 | .10 | — | .10 | 2.48 | 7.99 | 2,923 | 2.04 | 2.05 | 3.94 | 2.07 | 3.92 | 55 | |||||||||||||||||
| 2017(l) | 2.48 | .05 | (c) | .01 | .06 | .05 | — | .05 | 2.49 | 2.37 | †† | 2,620 | 1.96 | † | 1.96 | † | 3.82 | † | 1.98 | † | 3.80 | † | 33 | †† | ||||||||||
| Advisor Class | ||||||||||||||||||||||||||||||||||
| 2013(j) | 2.66 | .06 | (.05 | ) | .01 | .08 | — | .08 | 2.59 | .23 | †† | 1 | 1.03 | † | 1.03 | † | 4.59 | † | 5.13 | † | .49 | † | 60 | †† | ||||||||||
| 2014 | 2.59 | .12 | (c) | .02 | .14 | .14 | — | .14 | 2.59 | 5.42 | 31,132 | .91 | .91 | 4.83 | .93 | 4.81 | 47 | |||||||||||||||||
| 2015 | 2.59 | .12 | (c) | (.18 | ) | (.06 | ) | .14 | — | .14 | 2.39 | (2.47 | ) | 41,699 | .93 | .93 | 4.65 | .95 | 4.63 | 47 | ||||||||||||||
| 2016 | 2.39 | .12 | (c) | .10 | .22 | .13 | — | .13 | 2.48 | 9.34 | 68,198 | .93 | .94 | 5.02 | .96 | 5.00 | 55 | |||||||||||||||||
| 2017(l) | 2.48 | .06 | (c) | .01 | .07 | .06 | — | .06 | 2.49 | 2.99 | †† | 62,283 | .94 | † | .94 | † | 4.83 | † | .96 | † | 4.81 | † | 33 | †† | ||||||||||
| Institutional Class | ||||||||||||||||||||||||||||||||||
| 2013(j) | 2.66 | .03 | (.01 | ) | .02 | .08 | — | .08 | 2.60 | .66 | †† | 18,575 | .81 | † | .81 | † | 4.93 | † | .83 | † | 4.91 | † | 60 | †† | ||||||||||
| 2014 | 2.60 | .13 | (c) | .02 | .15 | .15 | — | .15 | 2.60 | 5.59 | 42,941 | .78 | .78 | 5.07 | .80 | 5.05 | 47 | |||||||||||||||||
| 2015 | 2.60 | .12 | (c) | (.17 | ) | (.05 | ) | .15 | — | .15 | 2.40 | (2.28 | ) | 51,704 | .78 | .78 | 4.81 | .80 | 4.79 | 47 | ||||||||||||||
| 2016 | 2.40 | .12 | (c) | .10 | .22 | .13 | — | .13 | 2.49 | 9.58 | 62,340 | .79 | .79 | 5.19 | .81 | 5.17 | 55 | |||||||||||||||||
| 2017(l) | 2.49 | .07 | (c) | .01 | .08 | .07 | — | .07 | 2.50 | 3.10 | †† | 61,881 | .79 | † | .79 | † | 5.00 | † | .81 | † | 4.98 | † | 33 | †† | ||||||||||
| 252 | 253 |
Financial Highlights (continued)
FIRST INVESTORS INCOME FUNDS
| PER SHARE DATA | RATIOS / SUPPLEMENTAL DATA | ||||||||||||||||||||||||||||||||
| Ratio to Average Net | |||||||||||||||||||||||||||||||||
| Less Distributions | Ratio to Average | Assets Before Expenses | |||||||||||||||||||||||||||||||
| Investment Operations | from | Net Assets** | Waived or Assumed | ||||||||||||||||||||||||||||||
| Net Asset | Net Realized | Net Asset | Net | ||||||||||||||||||||||||||||||
| Value, | Net | and Unrealized | Total from | Net | Net | Value, | Net Assets | Net Expenses | Net Expenses | Net | Investment | Portfolio | |||||||||||||||||||||
| Beginning | Investment | Gain (Loss) on | Investment | Investment | Realized | Total | End of | Total | End of Period | After Fee | Before Fee | Investment | Income | Turnover | |||||||||||||||||||
| of Period | Income | Investments | Operations | Income | Gain | Distributions | Period | Return* | (in thousands) | Credits | Credits*** | Income | Expenses*** | (Loss) | Rate | ||||||||||||||||||
| GOVERNMENT FUND | |||||||||||||||||||||||||||||||||
| Class A | |||||||||||||||||||||||||||||||||
| 2012 | $11.59 | $.27 | $ .04 | $ .31 | $.38 | — | $.38 | $11.52 | 2.71 | % | $382,064 | 1.10 | % | 1.10 | % | 2.28 | % | 1.21 | % | 2.17 | % | 36 | % | ||||||||||
| 2013 | 11.52 | .17 | (.43 | ) | (.26 | ) | .32 | — | .32 | 10.94 | (2.29 | ) | 355,264 | 1.10 | 1.10 | 1.57 | 1.21 | 1.46 | 101 | ||||||||||||||
| 2014 | 10.94 | .19 | (c) | — | .19 | .26 | — | .26 | 10.87 | 1.71 | 289,928 | 1.07 | 1.07 | 1.76 | 1.18 | 1.65 | 138 | ||||||||||||||||
| 2015 | 10.87 | .17 | (c) | .04 | .21 | .25 | — | .25 | 10.83 | 1.90 | 265,856 | 1.08 | 1.08 | 1.60 | 1.19 | 1.49 | 82 | ||||||||||||||||
| 2016 | 10.83 | .15 | (c) | .08 | .23 | .21 | — | .21 | 10.85 | 2.16 | 258,545 | 1.08 | 1.08 | 1.40 | 1.19 | 1.29 | 97 | ||||||||||||||||
| 2017(l) | 10.85 | .07 | (c) | (.40 | ) | (.33 | ) | .09 | — | .09 | 10.43 | (3.02 | )†† | 240,640 | 1.10 | † | 1.10 | † | 1.39 | † | 1.21 | † | 1.28 | † | 30 | ††† | |||||||
| Class B | |||||||||||||||||||||||||||||||||
| 2012 | 11.57 | .17 | .07 | .24 | .30 | — | .30 | 11.51 | 2.11 | 6,393 | 1.80 | 1.80 | 1.59 | 1.91 | 1.47 | 36 | |||||||||||||||||
| 2013 | 11.51 | .07 | (.42 | ) | (.35 | ) | .24 | — | .24 | 10.92 | (3.06 | ) | 4,717 | 1.84 | 1.84 | .82 | 1.95 | .71 | 101 | ||||||||||||||
| 2014 | 10.92 | .10 | (c) | (.01 | ) | .09 | .17 | — | .17 | 10.84 | .86 | 3,255 | 1.89 | 1.89 | .94 | 2.00 | .83 | 138 | |||||||||||||||
| 2015 | 10.84 | .08 | (c) | .03 | .11 | .15 | — | .15 | 10.80 | 1.04 | 2,514 | 1.91 | 1.91 | .78 | 2.02 | .67 | 82 | ||||||||||||||||
| 2016 | 10.80 | .06 | (c) | .09 | .15 | .12 | — | .12 | 10.83 | 1.38 | 2,062 | 1.89 | 1.90 | .59 | 2.01 | .48 | 97 | ||||||||||||||||
| 2017(l) | 10.83 | .03 | (c) | (.40 | ) | (.37 | ) | .05 | — | .05 | 10.41 | (3.41 | )†† | 1,446 | 1.91 | † | 1.91 | † | .57 | † | 2.02 | † | .46 | † | 30 | †† | |||||||
| Advisor Class | |||||||||||||||||||||||||||||||||
| 2013(j) | 11.29 | .10 | (.30 | ) | (.20 | ) | .15 | — | .15 | 10.94 | (1.75 | )†† | 1 | .95 | † | .95 | † | 1.68 | † | 5.17 | † | (2.54 | )† | 101 | †† | ||||||||
| 2014 | 10.94 | .23 | (c) | (.04 | ) | .19 | .27 | — | .27 | 10.86 | 1.73 | 33,699 | .73 | .73 | 2.06 | .84 | 1.95 | 138 | |||||||||||||||
| 2015 | 10.86 | .21 | (c) | .03 | .24 | .26 | — | .26 | 10.84 | 2.21 | 50,190 | .78 | .78 | 1.89 | .89 | 1.78 | 82 | ||||||||||||||||
| 2016 | 10.84 | .18 | (c) | .09 | .27 | .24 | — | .24 | 10.87 | 2.50 | 64,370 | .78 | .78 | 1.70 | .89 | 1.59 | 97 | ||||||||||||||||
| 2017(l) | 10.87 | .09 | (c) | (.40 | ) | (.31 | ) | .11 | — | .11 | 10.45 | (2.85 | )†† | 69,447 | .82 | † | .82 | † | 1.67 | † | .93 | † | 1.56 | † | 30 | †† | |||||||
| Institutional Class | |||||||||||||||||||||||||||||||||
| 2013(j) | 11.29 | .14 | (.31 | ) | (.17 | ) | .16 | — | .16 | 10.96 | (1.54 | )†† | 4,656 | .68 | † | .68 | † | 2.14 | † | .81 | † | 2.01 | † | 101 | †† | ||||||||
| 2014 | 10.96 | .24 | (c) | (.01 | ) | .23 | .29 | — | .29 | 10.90 | 2.08 | 10,753 | .65 | .65 | 2.17 | .76 | 2.06 | 138 | |||||||||||||||
| 2015 | 10.90 | .22 | (c) | .04 | .26 | .28 | — | .28 | 10.88 | 2.38 | 14,027 | .65 | .65 | 2.03 | .76 | 1.92 | 82 | ||||||||||||||||
| 2016 | 10.88 | .20 | (c) | .08 | .28 | .26 | — | .26 | 10.90 | 2.62 | 7,951 | .65 | .65 | 1.85 | .76 | 1.74 | 97 | ||||||||||||||||
| 2017(l) | 10.90 | .11 | (c) | (.38 | ) | (.27 | ) | .12 | — | .12 | 10.51 | (2.48 | )†† | 8,531 | .68 | † | .68 | † | 2.02 | † | .79 | † | 1.91 | † | 30 | †† | |||||||
| 254 | 255 |
Financial Highlights (continued)
FIRST INVESTORS INCOME FUNDS
| PER SHARE DATA | RATIOS / SUPPLEMENTAL DATA | ||||||||||||||||||||||||||||||||
| Ratio to Average Net | |||||||||||||||||||||||||||||||||
| Less Distributions | Ratio to Average | Assets Before Expenses | |||||||||||||||||||||||||||||||
| Investment Operations | from | Net Assets** | Waived or Assumed | ||||||||||||||||||||||||||||||
| Net Asset | Net Realized | Net Asset | Net | Net | |||||||||||||||||||||||||||||
| Value, | Net | and Unrealized | Total from | Net | Net | Value, | Net Assets | Net Expenses | Net Expenses | Investment | Investment | Portfolio | |||||||||||||||||||||
| Beginning | Investment | Gain (Loss) on | Investment | Investment | Realized | Total | End of | Total | End of Period | After Fee | Before Fee | Income | Income | Turnover | |||||||||||||||||||
| of Period | Income | Investments | Operations | Income | Gain | Distributions | Period | Return* | (in thousands) | Credits | Credits*** | (Loss) | Expenses*** | (Loss) | Rate | ||||||||||||||||||
| GOVERNMENT CASH MANAGEMENT FUND(e) | |||||||||||||||||||||||||||||||||
| Class A | |||||||||||||||||||||||||||||||||
| 2012 | $ 1.00 | — | — | — | — | — | — | $ 1.00 | 0.00 | % | $135,028 | .12 | % | .12 | % | .00 | % | 1.02 | % | (.90 | )% | N/A | |||||||||||
| 2013 | 1.00 | — | — | — | — | — | — | 1.00 | 0.00 | 130,272 | .11 | .11 | .00 | .97 | (.86 | ) | N/A | ||||||||||||||||
| 2014 | 1.00 | — | — | — | — | — | — | 1.00 | 0.00 | 108,088 | .08 | .08 | .00 | 1.02 | (.94 | ) | N/A | ||||||||||||||||
| 2015 | 1.00 | — | — | — | — | — | — | 1.00 | 0.00 | 109,566 | .10 | .10 | .00 | 1.08 | (.98 | ) | N/A | ||||||||||||||||
| 2016 | 1.00 | — | — | — | — | — | — | 1.00 | 0.00 | 122,037 | .33 | .33 | .00 | 1.05 | (.72 | ) | N/A | ||||||||||||||||
| 2017(l) | 1.00 | — | — | — | — | — | — | 1.00 | 0.00 | †† | 131,430 | .47 | † | .47 | † | .00 | † | 1.01 | † | (.54 | )† | N/A | |||||||||||
| Class B | |||||||||||||||||||||||||||||||||
| 2012 | 1.00 | — | — | — | — | — | — | 1.00 | 0.00 | 896 | .12 | .12 | .00 | 1.77 | (1.65 | ) | N/A | ||||||||||||||||
| 2013 | 1.00 | — | — | — | — | — | — | 1.00 | 0.00 | 571 | .12 | .12 | .00 | 1.72 | (1.60 | ) | N/A | ||||||||||||||||
| 2014 | 1.00 | — | — | — | — | — | — | 1.00 | 0.00 | 404 | .08 | .08 | .00 | 1.64 | (1.56 | ) | N/A | ||||||||||||||||
| 2015 | 1.00 | — | — | — | — | — | — | 1.00 | 0.00 | 287 | .10 | .10 | .00 | 1.72 | (1.62 | ) | N/A | ||||||||||||||||
| 2016 | 1.00 | — | — | — | — | — | — | 1.00 | 0.00 | 248 | .33 | .33 | .00 | 1.77 | (1.44 | ) | N/A | ||||||||||||||||
| 2017(l) | 1.00 | — | — | �� | — | — | — | — | 1.00 | 0.00 | †† | 233 | .47 | † | .47 | † | .00 | † | 1.76 | † | (1.29 | )† | N/A | ||||||||||
| Institutional Class | |||||||||||||||||||||||||||||||||
| 2013(j) | 1.00 | — | — | — | — | — | — | 1.00 | 0.00 | †† | 1 | .15 | † | .15 | † | .00 | † | 2.60 | † | (2.45 | )† | N/A | |||||||||||
| 2014 | 1.00 | — | — | — | — | — | — | 1.00 | 0.00 | 2,595 | .08 | .08 | .00 | .66 | (.58 | ) | N/A | ||||||||||||||||
| 2015 | 1.00 | — | — | — | — | — | — | 1.00 | 0.00 | 2,267 | .10 | .10 | .00 | .67 | (.57 | ) | N/A | ||||||||||||||||
| 2016 | 1.00 | — | — | — | — | — | — | 1.00 | 0.00 | 2,844 | .33 | .33 | .00 | .68 | (.35 | ) | N/A | ||||||||||||||||
| 2017(l) | 1.00 | — | — | — | — | — | — | 1.00 | 0.00 | †† | 2,864 | .47 | † | .47 | † | .00 | † | .68 | † | (.21 | )† | N/A | |||||||||||
| INTERNATIONAL OPPORTUNITIES BOND FUND | |||||||||||||||||||||||||||||||||
| Class A | |||||||||||||||||||||||||||||||||
| 2012(k) | $10.00 | $.01 | $ .23 | $ .24 | $.02 | $ — | $.02 | $10.22 | 2.35 | %†† | $19,563 | 1.30 | %† | 1.30 | %† | 1.10 | %† | 9.76 | %† | (6.12 | )%† | 5 | %†† | ||||||||||
| 2013 | 10.22 | .25 | (.32 | ) | (.07 | ) | .30 | .01 | .31 | 9.84 | (.72 | ) | 99,161 | 1.30 | 1.30 | .68 | 1.83 | .15 | 53 | ||||||||||||||
| 2014 | 9.84 | .21 | (c) | .07 | .28 | .27 | — | .27 | 9.85 | 2.84 | 80,197 | 1.30 | 1.30 | 2.06 | 1.41 | 1.95 | 76 | ||||||||||||||||
| 2015 | 9.85 | .12 | (c) | (1.06 | ) | (.94 | ) | .28 | — | .28 | 8.63 | (9.72 | ) | 69,394 | 1.30 | 1.30 | 1.29 | 1.38 | 1.21 | 61 | |||||||||||||
| 2016 | 8.63 | .20 | (c) | .51 | .71 | .13 | — | .13 | 9.21 | 8.30 | 65,456 | 1.38 | 1.38 | 2.29 | 1.41 | 2.26 | 72 | ||||||||||||||||
| 2017(l) | 9.21 | .09 | (c) | (.30 | ) | (.21 | ) | — | — | — | 9.00 | (2.28 | )†† | 59,113 | 1.43 | † | 1.43 | † | 2.23 | † | N/A | N/A | 41 | †† | |||||||||
| Advisor Class | |||||||||||||||||||||||||||||||||
| 2013(j) | 10.23 | .08 | (.31 | ) | (.23 | ) | .15 | — | .15 | 9.85 | (2.26 | )†† | 1 | 1.07 | † | 1.07 | † | (1.43 | )† | 5.23 | † | (5.59 | )† | 53 | †† | ||||||||
| 2014 | 9.85 | .24 | (c) | .04 | .28 | .28 | — | .28 | 9.85 | 2.81 | 33,851 | 1.10 | 1.10 | 2.21 | N/A | N/A | 76 | ||||||||||||||||
| 2015 | 9.85 | .14 | (c) | (1.06 | ) | (.92 | ) | .29 | — | .29 | 8.64 | (9.51 | ) | 50,912 | 1.04 | 1.04 | 1.56 | N/A | N/A | 61 | |||||||||||||
| 2016 | 8.64 | .23 | (c) | .51 | .74 | .13 | — | .13 | 9.25 | 8.70 | 50,749 | 1.08 | 1.08 | 2.60 | N/A | N/A | 72 | ||||||||||||||||
| 2017(l) | 9.25 | .11 | (c) | (.31 | ) | (.20 | ) | — | — | — | 9.05 | (2.16 | )†† | 59,208 | 1.14 | † | 1.14 | † | 2.53 | † | N/A | N/A | 41 | †† | |||||||||
| Institutional Class | |||||||||||||||||||||||||||||||||
| 2013(j) | 10.23 | .12 | (.35 | ) | (.23 | ) | .15 | — | .15 | 9.85 | (2.26 | )†† | 6,998 | .96 | † | .96 | † | (1.31 | )† | N/A | N/A | 53 | †† | ||||||||||
| 2014 | 9.85 | .25 | (c) | .06 | .31 | .28 | — | .28 | 9.88 | 3.19 | 16,014 | .93 | .93 | 2.43 | N/A | N/A | 76 | ||||||||||||||||
| 2015 | 9.88 | .17 | (c) | (1.08 | ) | (.91 | ) | .30 | — | .30 | 8.67 | (9.36 | ) | 19,097 | .90 | .90 | 1.69 | N/A | N/A | 61 | |||||||||||||
| 2016 | 8.67 | .24 | (c) | .52 | .76 | .14 | — | .14 | 9.29 | 8.85 | 8,289 | .93 | .93 | 2.75 | N/A | N/A | 72 | ||||||||||||||||
| 2017(l) | 9.29 | .12 | (c) | (.31 | ) | (.19 | ) | — | — | — | 9.10 | (2.05 | )†† | 8,570 | .95 | † | .95 | † | 2.67 | † | N/A | N/A | 41 | †† | |||||||||
| 256 | 257 |
Financial Highlights (continued)
FIRST INVESTORS INCOME FUNDS
| PER SHARE DATA | RATIOS / SUPPLEMENTAL DATA | ||||||||||||||||||||||||||||||||
| Ratio to Average Net | |||||||||||||||||||||||||||||||||
| Less Distributions | Ratio to Average | Assets Before Expenses | |||||||||||||||||||||||||||||||
| Investment Operations | from | Net Assets** | Waived or Assumed | ||||||||||||||||||||||||||||||
| Net Asset | Net Realized | Net Asset | Net | ||||||||||||||||||||||||||||||
| Value, | Net | and Unrealized | Total from | Net | Net | Value, | Net Assets | Net Expenses | Net Expenses | Net | Investment | Portfolio | |||||||||||||||||||||
| Beginning | Investment | Gain (Loss) on | Investment | Investment | Realized | Total | End of | Total | End of Period | After Fee | Before Fee | Investment | Income | Turnover | |||||||||||||||||||
| of Period | Income | Investments | Operations | Income | Gain | Distributions | Period | Return* | (in thousands) | Credits | Credits*** | Income | Expenses*** | (Loss) | Rate | ||||||||||||||||||
| INVESTMENT GRADE FUND | |||||||||||||||||||||||||||||||||
| Class A | |||||||||||||||||||||||||||||||||
| 2012 | $ 9.62 | $ .38 | $ .68 | $1.06 | $.41 | — | $.41 | $10.27 | 11.22 | % | $531,896 | 1.08 | % | 1.08 | % | 3.54 | % | 1.19 | % | 3.43 | % | 40 | % | ||||||||||
| 2013 | 10.27 | .35 | (.46 | ) | (.11 | ) | .38 | — | .38 | 9.78 | (1.10 | ) | 543,955 | 1.07 | 1.07 | 3.20 | 1.18 | 3.09 | 33 | ||||||||||||||
| 2014 | 9.78 | .31 | (c) | .22 | .53 | .39 | — | .39 | 9.92 | 5.50 | 475,090 | 1.05 | 1.05 | 3.11 | 1.16 | 3.00 | 49 | ||||||||||||||||
| 2015 | 9.92 | .28 | (c) | (.17 | ) | .11 | .39 | — | .39 | 9.64 | 1.12 | 458,704 | 1.04 | 1.04 | 2.85 | 1.15 | 2.74 | 36 | |||||||||||||||
| 2016 | 9.64 | .27 | (c) | .35 | .62 | .36 | — | .36 | 9.90 | 6.55 | 477,010 | 1.04 | 1.05 | 2.78 | 1.15 | 2.68 | 37 | ||||||||||||||||
| 2017(l) | 9.90 | .13 | (c) | (.31 | ) | (.18 | ) | .17 | — | .17 | 9.55 | (1.87 | )†† | 462,193 | 1.05 | † | 1.05 | † | 2.76 | † | 1.16 | † | 2.65 | † | 25 | †† | |||||||
| Class B | |||||||||||||||||||||||||||||||||
| 2012 | 9.62 | .32 | .66 | .98 | .34 | — | .34 | 10.26 | 10.41 | 8,036 | 1.78 | 1.78 | 2.84 | 1.89 | 2.74 | 40 | |||||||||||||||||
| 2013 | 10.26 | .27 | (.45 | ) | (.18 | ) | .32 | — | .32 | 9.76 | (1.82 | ) | 6,161 | 1.84 | 1.84 | 2.42 | 1.94 | 2.32 | 33 | ||||||||||||||
| 2014 | 9.76 | .22 | (c) | .22 | .44 | .33 | — | .33 | 9.87 | 4.53 | 4,727 | 1.92 | 1.92 | 2.24 | 2.03 | 2.13 | 49 | ||||||||||||||||
| 2015 | 9.87 | .20 | (c) | (.17 | ) | .03 | .33 | — | .33 | 9.57 | .27 | 3,623 | 1.92 | 1.92 | 1.98 | 2.03 | 1.87 | 36 | |||||||||||||||
| 2016 | 9.57 | .19 | (c) | .34 | .53 | .27 | — | .27 | 9.83 | 5.61 | 2,907 | 1.92 | 1.92 | 1.91 | 2.03 | 1.80 | 37 | ||||||||||||||||
| 2017(l) | 9.83 | .09 | (c) | (.32 | ) | (.23 | ) | .11 | — | .11 | 9.49 | (2.30 | )†† | 2,521 | 1.90 | † | 1.90 | † | 1.90 | † | 2.01 | † | 1.79 | † | 25 | †† | |||||||
| Advisor Class | |||||||||||||||||||||||||||||||||
| 2013(j) | 10.23 | .08 | (.34 | ) | (.26 | ) | .19 | — | .19 | 9.78 | (2.53 | )†† | 1 | .95 | † | .95 | † | 2.64 | † | 5.17 | † | (1.58 | )† | 33 | †† | ||||||||
| 2014 | 9.78 | .34 | (c) | .20 | .54 | .40 | — | .40 | 9.92 | 5.61 | 44,351 | .69 | .69 | 3.38 | .80 | 3.27 | 49 | ||||||||||||||||
| 2015 | 9.92 | .31 | (c) | (.16 | ) | .15 | .40 | — | .40 | 9.67 | 1.53 | 63,614 | .73 | .73 | 3.17 | .84 | 3.06 | 36 | |||||||||||||||
| 2016 | 9.67 | .30 | (c) | .34 | .64 | .37 | — | .37 | 9.94 | 6.78 | 83,659 | .74 | .74 | 3.08 | .85 | 2.97 | 37 | ||||||||||||||||
| 2017(l) | 9.94 | .14 | (c) | (.30 | ) | (.16 | ) | .18 | — | .18 | 9.60 | (1.63 | )†† | 92,381 | .74 | † | .74 | † | 3.07 | † | .85 | † | 2.96 | † | 25 | †† | |||||||
| Institutional Class | |||||||||||||||||||||||||||||||||
| 2013(j) | 10.23 | .14 | (.38 | ) | (.24 | ) | .20 | — | .20 | 9.79 | (2.37 | )†† | 9,326 | .66 | † | .66 | † | 3.06 | † | .77 | † | 2.95 | † | 33 | †† | ||||||||
| 2014 | 9.79 | .35 | (c) | .23 | .58 | .43 | — | .43 | 9.94 | 5.98 | 22,269 | .63 | .63 | 3.51 | .74 | 3.40 | 49 | ||||||||||||||||
| 2015 | 9.94 | .32 | (c) | (.17 | ) | .15 | .43 | — | .43 | 9.66 | 1.48 | 15,025 | .63 | .63 | 3.26 | .74 | 3.15 | 36 | |||||||||||||||
| 2016 | 9.66 | .31 | (c) | .35 | .66 | .40 | — | .40 | 9.92 | 6.97 | 31,395 | .63 | .63 | 3.17 | .74 | 3.06 | 37 | ||||||||||||||||
| 2017(l) | 9.92 | .15 | (c) | (.31 | ) | (.16 | ) | .19 | — | .19 | 9.57 | (1.65 | )†† | 29,550 | .64 | † | .64 | † | 3.17 | † | .75 | † | 3.06 | † | 25 | †† | |||||||
| 258 | 259 |
Financial Highlights (continued)
FIRST INVESTORS INCOME FUNDS
| PER SHARE DATA | RATIOS / SUPPLEMENTAL DATA | ||||||||||||||||||||||||||||||||
| Ratio to Average Net | |||||||||||||||||||||||||||||||||
| Less Distributions | Ratio to Average | Assets Before Expenses | |||||||||||||||||||||||||||||||
| Investment Operations | from | Net Assets** | Waived or Assumed | ||||||||||||||||||||||||||||||
| Net Asset | Net | Net Realized | Net Asset | Net | Net | ||||||||||||||||||||||||||||
| Value, | Investment | and Unrealized | Total from | Net | Net | Value, | Net Assets | Net Expenses | Net Expenses | Investment | Investment | Portfolio | |||||||||||||||||||||
| Beginning | Income | Gain (Loss) on | Investment | Investment | Realized | Total | End of | Total | End of Period | After Fee | Before Fee | Income | Income | Turnover | |||||||||||||||||||
| of Period | (Loss) | Investments | Operations | Income | Gain | Distributions | Period | Return* | (in thousands) | Credits | Credits*** | (Loss) | Expenses*** | (Loss) | Rate | ||||||||||||||||||
| LIMITED DURATION HIGH QUALITY BOND FUND | |||||||||||||||||||||||||||||||||
| Class A | |||||||||||||||||||||||||||||||||
| 2014(g) | $10.00 | $ — | (c) | $ (.05 | ) | $ (.05 | ) | $.06 | — | $.06 | $9.89 | (.50 | )%†† | $ 8,911 | 1.05 | %† | 1.05 | %† | .15 | %† | 3.37 | %† | (2.17 | )%† | 19 | %†† | |||||||
| 2015 | 9.89 | .03 | (c) | .04 | .07 | .20 | — | .20 | 9.76 | .67 | 26,852 | 1.05 | 1.05 | .37 | 1.32 | .10 | 57 | ||||||||||||||||
| 2016 | 9.76 | (.03 | )(c) | .15 | .12 | .22 | — | .22 | 9.66 | 1.21 | 48,342 | 1.05 | 1.05 | (.25 | ) | 1.23 | (.43 | ) | 54 | ||||||||||||||
| 2017(l) | 9.66 | .04 | (c) | (.11 | ) | (.07 | ) | .11 | — | .11 | 9.48 | (.74 | )†† | 59,188 | 1.05 | † | 1.05 | † | .79 | † | 1.21 | † | .63 | † | 27 | †† | |||||||
| Advisor Class | |||||||||||||||||||||||||||||||||
| 2014(g) | 10.00 | .02 | (c) | (.05 | ) | (.03 | ) | .06 | — | .06 | 9.91 | (.28 | )†† | 25,649 | .75 | † | .75 | † | .46 | † | 1.02 | † | .19 | † | 19 | †† | |||||||
| 2015 | 9.91 | .06 | (c) | .05 | .11 | .22 | — | .22 | 9.80 | 1.08 | 40,502 | .75 | .75 | .66 | 1.09 | .32 | 57 | ||||||||||||||||
| 2016 | 9.80 | — | (c) | .14 | .14 | .25 | — | .25 | 9.69 | 1.47 | 50,645 | .75 | .75 | .04 | 1.01 | (.22 | ) | 54 | |||||||||||||||
| 2017(l) | 9.69 | .05 | (c) | (.11 | ) | (.06 | ) | .12 | — | .12 | 9.51 | (.59 | )†† | 55,152 | .75 | † | .75 | † | 1.09 | † | 1.00 | † | .84 | † | 27 | †† | |||||||
| Institutional Class | |||||||||||||||||||||||||||||||||
| 2014(g) | 10.00 | .02 | (c) | (.03 | ) | (.01 | ) | .07 | — | .07 | 9.92 | (.14 | )†† | 5,125 | .60 | † | .60 | † | .53 | † | 3.32 | † | (2.19 | )† | 19 | †† | |||||||
| 2015 | 9.92 | .08 | (c) | .04 | .12 | .23 | — | .23 | 9.81 | 1.21 | 6,747 | .60 | .60 | .81 | .92 | .49 | 57 | ||||||||||||||||
| 2016 | 9.81 | .02 | (c) | .14 | .16 | .27 | — | .27 | 9.70 | 1.64 | 22,296 | .60 | .60 | .20 | .82 | (.02 | ) | 54 | |||||||||||||||
| 2017(l) | 9.70 | .06 | (c) | (.11 | ) | (.05 | ) | .13 | — | .13 | 9.52 | (.52 | )†† | 23,392 | .60 | † | .60 | † | 1.24 | † | .81 | † | 1.03 | † | 27 | †† | |||||||
| STRATEGIC INCOME FUND | |||||||||||||||||||||||||||||||||
| Class A | |||||||||||||||||||||||||||||||||
| 2013(i) | $10.00 | $ .14 | (a) | $(.23 | ) | $(.09 | ) | $.13 | $ — | $.13 | $9.78 | (.87 | )%†† | $ 47,344 | 1.30 | %†(b) | 1.30 | %†(b) | 2.88 | %†(a) | 2.10 | 2.08 | %†(a) | 19 | %†† | ||||||||
| 2014 | 9.78 | .32 | (a)(c) | .12 | .44 | .28 | .00 | (d) | .28 | 9.94 | 4.55 | 101,540 | .80 | (b) | .80 | (b) | 3.18 | (a) | .68 | (b) | 3.30 | (a) | 20 | ||||||||||
| 2015 | 9.94 | .34 | (a)(c) | (.57 | ) | (.23 | ) | .34 | .07 | .41 | 9.30 | (2.37 | ) | 131,734 | .59 | (b) | .59 | (b) | 3.55 | (a) | N/A | N/A | 40 | ||||||||||
| 2016 | 9.30 | .30 | (a)(c) | .22 | .52 | .32 | .02 | .34 | 9.48 | 5.64 | 149,190 | .58 | (b) | .58 | (b) | 3.19 | (a) | N/A | N/A | 49 | |||||||||||||
| 2017(l) | 9.48 | .15 | (a)(c) | (.06 | ) | .09 | .13 | — | .13 | 9.44 | .99 | †† | 158,180 | .57 | (b)† | .58 | (b)† | 3.18 | (a)† | N/A | N/A | 19 | †† | ||||||||||
| Advisor Class | |||||||||||||||||||||||||||||||||
| 2013(i) | 10.00 | .14 | (a) | (.22 | ) | (.08 | ) | .15 | — | .15 | 9.77 | (.79 | )†† | 1 | 1.00 | †(b) | 1.00 | †(b) | 2.89 | †(a) | 14.79 | †(b) | (10.90) | †(a) | 19 | †† | |||||||
| 2014 | 9.77 | .36 | (a)(c) | .11 | .47 | .32 | .00 | (d) | .32 | 9.92 | 4.82 | 323 | .36 | (b) | .36 | (b) | 3.62 | (a) | .29 | (b) | 3.69 | (a) | 20 | ||||||||||
| 2015 | 9.92 | .38 | (a)(c) | (.56 | ) | (.18 | ) | .38 | .07 | .45 | 9.29 | (1.93 | ) | 306 | .19 | (b) | .19 | (b) | 3.95 | (a) | N/A | N/A | 40 | ||||||||||
| 2016 | 9.29 | .33 | (a)(c) | .23 | .56 | .36 | .02 | .38 | 9.47 | 6.14 | 415 | .17 | (b) | .17 | (b) | 3.59 | (a) | N/A | N/A | 49 | |||||||||||||
| 2017(l) | 9.47 | .17 | (a)(c) | (.06 | ) | .11 | .15 | — | .15 | 9.43 | 1.22 | †† | 696 | .15 | (b)† | .16 | (b)† | 3.59 | (a)† | N/A | N/A | 19 | †† | ||||||||||
| 260 | See notes to financial statements | 261 |
Financial Highlights (continued)
FIRST INVESTORS INCOME FUNDS
| * | Calculated without sales charges. | |
| ** | Net of expenses waived or assumed (Note 3). | |
| *** | The ratios do not include a reduction of expenses from cash balances maintained with the custodian or from | |
| brokerage service arrangements (Note 1G). | ||
| † | Annualized | |
| †† | Not annualized | |
| (a) | Recognition of net investment income by the Fund is affected by the timing of the declaration of dividends | |
| by the underlying investment companies in which the Fund invests. The ratio does not include net | ||
| investment income of the investment companies in which the Fund invests. | ||
| (b) | Does not include expenses of the investment companies in which the Fund invests. | |
| (c) | Based on average shares during the period. | |
| (d) | Due to rounding, amount is less than .005 per share. | |
| (e) | Prior to October 3, 2016, known as Cash Management Fund. | |
| (f) | For the period October 1, 2015 (commencement of operations) to September 30, 2016. | |
| (g) | For the period May 19, 2014 (commencement of operations) to September 30, 2014. | |
| (h) | For the period October 21, 2013 (commencement of operations) to September 30, 2014. | |
| (i) | For the period April 3, 2013 (commencement of operations) to September 30, 2013. | |
| (j) | For the period April 1, 2013 (commencement of operations) to September 30, 2013. | |
| (k) | For the period August 20, 2012 (commencement of operations) to September 30, 2012. | |
| (l) | For the period October 1, 2016 to March 31, 2017. |
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| 262 | 263 |
Financial Highlights
FIRST INVESTORS EQUITY FUNDS
The following table sets forth the per share operating performance data for a share outstanding,
total return, ratios to average net assets and other supplemental data for each fiscal year ended
September 30, except as otherwise indicated.
| PER SHARE DATA | RATIOS / SUPPLEMENTAL DATA | ||||||||||||||||||||||||||||||||
| Ratio to Average Net | |||||||||||||||||||||||||||||||||
| Less Distributions | Ratio to Average | Assets Before Expenses | |||||||||||||||||||||||||||||||
| Investment Operations | from | Net Assets** | Waived or Assumed | ||||||||||||||||||||||||||||||
| Net Asset | Net Realized | Net Asset | Net | ||||||||||||||||||||||||||||||
| Value, | Net | and Unrealized | Total from | Net | Net | Value, | Net Assets | Net Expenses | Net Expenses | Net | Investment | Portfolio | |||||||||||||||||||||
| Beginning | Investment | Gain (Loss) on | Investment | Investment | Realized | Total | End of | Total | End of Period | After Fee | Before Fee | Investment | Income | Turnover | |||||||||||||||||||
| of Period | Income | Investments | Operations | Income | Gain | Distributions | Period | Return* | (in thousands) | Credits | Credits*** | Income | Expenses*** | (Loss) | Rate | ||||||||||||||||||
| COVERED CALL STRATEGY FUND | |||||||||||||||||||||||||||||||||
| Class A | |||||||||||||||||||||||||||||||||
| 2016(e) | $10.00 | $.06 | (a) | $ .33 | $ .39 | $.03 | $ — | $.03 | $10.36 | 3.94 | %†† | $ 48,514 | 1.30 | %† | 1.30 | %† | 1.19 | %† | 1.73 | %† | .76 | %† | 83 | %†† | |||||||||
| 2017(i) | 10.36 | .06 | (a) | .55 | .61 | .05 | .02 | .07 | 10.90 | 5.82 | †† | 122,682 | 1.30 | † | 1.30 | † | 1.13 | † | 1.45 | † | .98 | † | 93 | †† | |||||||||
| Advisor Class | |||||||||||||||||||||||||||||||||
| 2016(e) | 10.00 | .08 | (a) | .32 | .40 | .06 | — | .06 | 10.34 | 4.05 | †† | 39,129 | .97 | † | .97 | † | 1.64 | † | 1.50 | † | 1.11 | † | 83 | †† | |||||||||
| 2017(i) | 10.34 | .08 | (a) | .55 | .63 | .08 | .02 | .10 | 10.87 | 6.04 | †† | 68,491 | .97 | † | .97 | † | 1.46 | † | 1.16 | † | 1.27 | † | 93 | †† | |||||||||
| Institutional Class | |||||||||||||||||||||||||||||||||
| 2016(e) | 10.00 | .09 | (a) | .33 | .42 | .07 | — | .07 | 10.35 | 4.18 | †† | 4,214 | .84 | † | .84 | † | 1.76 | † | 1.25 | † | 1.35 | † | 83 | †† | |||||||||
| 2017(i) | 10.35 | .09 | (a) | .54 | .63 | .08 | .02 | .10 | 10.88 | 6.10 | †† | 6,381 | .84 | † | .84 | † | 1.63 | † | 1.06 | † | 1.41 | † | 93 | †† | |||||||||
| EQUITY INCOME FUND(h) | |||||||||||||||||||||||||||||||||
| Class A | |||||||||||||||||||||||||||||||||
| 2012 | $ 6.20 | $.13 | $1.44 | $1.57 | $.10 | $ — | $.10 | $ 7.67 | 25.36 | % | $ 392,001 | 1.33 | % | 1.33 | % | 1.75 | % | N/A | N/A | 38 | % | ||||||||||||
| 2013 | 7.67 | .14 | 1.32 | 1.46 | .14 | — | .14 | 8.99 | 19.14 | 475,422 | 1.28 | 1.28 | 1.66 | N/A | N/A | 32 | |||||||||||||||||
| 2014 | 8.99 | .13 | (a) | 1.16 | 1.29 | .14 | .15 | .29 | 9.99 | 14.48 | 510,981 | 1.21 | 1.22 | 1.33 | N/A | N/A | 27 | ||||||||||||||||
| 2015 | 9.99 | .15 | (a) | (.54 | ) | (.39 | ) | .15 | .46 | .61 | 8.99 | (4.31 | ) | 485,342 | 1.21 | 1.21 | 1.52 | N/A | N/A | 23 | |||||||||||||
| 2016 | 8.99 | .16 | (a) | 1.08 | 1.24 | .16 | .35 | .51 | 9.72 | 14.16 | 529,327 | 1.22 | 1.22 | 1.72 | N/A | N/A | 22 | ||||||||||||||||
| 2017(i) | 9.72 | .08 | (a) | .71 | .79 | .10 | .18 | .28 | 10.23 | 8.13 | †† | 552,205 | 1.21 | † | 1.21 | † | 1.64 | † | N/A | N/A | 8 | †† | |||||||||||
| Class B | |||||||||||||||||||||||||||||||||
| 2012 | 6.10 | .08 | 1.42 | 1.50 | .05 | — | .05 | 7.55 | 24.56 | 6,939 | 2.03 | 2.03 | 1.02 | N/A | N/A | 38 | |||||||||||||||||
| 2013 | 7.55 | .09 | 1.28 | 1.37 | .08 | — | .08 | 8.84 | 18.21 | 6,337 | 2.05 | 2.05 | .90 | N/A | N/A | 32 | |||||||||||||||||
| 2014 | 8.84 | .05 | (a) | 1.13 | 1.18 | .05 | .15 | .20 | 9.82 | 13.49 | 5,721 | 2.06 | 2.06 | .49 | N/A | N/A | 27 | ||||||||||||||||
| 2015 | 9.82 | .06 | (a) | (.53 | ) | (.47 | ) | .07 | .46 | .53 | 8.82 | (5.16 | ) | 3,847 | 2.06 | 2.06 | .67 | N/A | N/A | 23 | |||||||||||||
| 2016 | 8.82 | .08 | (a) | 1.06 | 1.14 | .09 | .35 | .44 | 9.52 | 13.20 | 3,446 | 2.07 | 2.07 | .87 | N/A | N/A | 22 | ||||||||||||||||
| 2017(i) | 9.52 | .04 | (a) | .70 | .74 | .06 | .18 | .24 | 10.02 | 7.79 | †† | 3,211 | 2.03 | † | 2.03 | † | .82 | † | N/A | N/A | 8 | †† | |||||||||||
| Advisor Class | |||||||||||||||||||||||||||||||||
| 2013(g) | 8.40 | .08 | .58 | .66 | .07 | — | .07 | 8.99 | 7.87 | †† | 1 | 1.01 | † | 1.01 | † | 1.78 | † | 4.68 | %† | (1.89 | )%† | 32 | †† | ||||||||||
| 2014 | 8.99 | .17 | (a) | 1.13 | 1.30 | .15 | .15 | .30 | 9.99 | 14.57 | 32,160 | .81 | .81 | 1.71 | N/A | N/A | 27 | ||||||||||||||||
| 2015 | 9.99 | .19 | (a) | (.55 | ) | (.36 | ) | .17 | .46 | .63 | 9.00 | (3.96 | ) | 38,482 | .84 | .84 | 1.90 | N/A | N/A | 23 | |||||||||||||
| 2016 | 9.00 | .20 | (a) | 1.08 | 1.28 | .19 | .35 | .54 | 9.74 | 14.63 | 54,576 | .85 | .85 | 2.08 | N/A | N/A | 22 | ||||||||||||||||
| 2017(i) | 9.74 | .10 | (a) | .70 | .80 | .11 | .18 | .29 | 10.25 | 8.29 | †† | 65,506 | .85 | † | .85 | † | 2.00 | † | N/A | N/A | 8 | †† | |||||||||||
| Institutional Class | |||||||||||||||||||||||||||||||||
| 2013(g) | 8.40 | .04 | .63 | .67 | .05 | — | .05 | 9.02 | 7.95 | †† | 4,717 | .86 | † | .86 | † | 1.74 | † | .86 | † | 1.74 | † | 32 | †† | ||||||||||
| 2014 | 9.02 | .17 | (a) | 1.16 | 1.33 | .17 | .15 | .32 | 10.03 | 14.88 | 7,399 | .80 | .80 | 1.76 | N/A | N/A | 27 | ||||||||||||||||
| 2015 | 10.03 | .19 | (a) | (.55 | ) | (.36 | ) | .17 | .46 | .63 | 9.04 | (3.97 | ) | 9,773 | .81 | .81 | 1.93 | N/A | N/A | 23 | |||||||||||||
| 2016 | 9.04 | .20 | (a) | 1.09 | 1.29 | .20 | .35 | .55 | 9.78 | 14.67 | 2,448 | .78 | .78 | 2.08 | N/A | N/A | 22 | ||||||||||||||||
| 2017(i) | 9.78 | .11 | (a) | .70 | .81 | .11 | .18 | .29 | 10.30 | 8.35 | †† | 2,286 | .81 | † | .81 | † | 2.10 | † | N/A | N/A | 8 | †† | |||||||||||
| 264 | 265 |
Financial Highlights (continued)
FIRST INVESTORS EQUITY FUNDS
| PER SHARE DATA | RATIOS / SUPPLEMENTAL DATA | ||||||||||||||||||||||||||||||||||
| Ratio to Average Net | |||||||||||||||||||||||||||||||||||
| Less Distributions | Ratio to Average | Assets Before Expenses | |||||||||||||||||||||||||||||||||
| Investment Operations | from | Net Assets** | Waived or Assumed | ||||||||||||||||||||||||||||||||
| Net Asset | Net | Net Realized | Net Asset | Net | Net | ||||||||||||||||||||||||||||||
| Value, | Investment | and Unrealized | Total from | Net | Net | Value, | Net Assets | Net Expenses | Net Expenses | Investment | Investment | Portfolio | |||||||||||||||||||||||
| Beginning | Income | Gain on | Investment | Investment | Realized | Total | End of | Total | End of Period | After Fee | Before Fee | Income | Income | Turnover | |||||||||||||||||||||
| of Period | (Loss) | Investments | Operations | Income | Gain | Distributions | Period | Return* | (in thousands) | Credits | Credits*** | (Loss) | Expenses*** | (Loss) | Rate | ||||||||||||||||||||
| GLOBAL FUND | |||||||||||||||||||||||||||||||||||
| Class A | |||||||||||||||||||||||||||||||||||
| 2012 | $5.54 | $ .03 | $1.24 | $1.27 | $.02 | $ — | $ .02 | $6.79 | 22.88 | % | $283,328 | 1.68 | % | 1.69 | % | .44 | % | 1.70 | % | .42 | % | 94 | % | ||||||||||||
| 2013 | 6.79 | .05 | 1.20 | 1.25 | .03 | — | .03 | 8.01 | 18.56 | 317,329 | 1.60 | 1.61 | .66 | 1.62 | .65 | 92 | |||||||||||||||||||
| 2014 | 8.01 | — | (a) | .80 | .80 | .04 | .11 | .15 | 8.66 | 10.00 | 332,416 | 1.49 | 1.49 | .03 | 1.54 | (.02 | ) | 154 | |||||||||||||||||
| 2015 | 8.66 | — | (a) | .11 | .11 | — | 1.51 | 1.51 | 7.26 | .87 | 331,382 | 1.47 | 1.47 | (.01 | ) | 1.52 | (.06 | ) | 97 | ||||||||||||||||
| 2016 | 7.26 | .01 | (a) | .43 | .44 | .00 | (b) | .40 | .40 | 7.30 | 6.03 | 339,956 | 1.47 | 1.47 | .09 | 1.52 | .04 | 94 | |||||||||||||||||
| 2017(i) | 7.30 | (.01 | )(a) | .60 | .59 | .01 | — | .01 | 7.88 | 8.11 | †† | 354,796 | 1.46 | † | 1.46 | † | (.14 | )† | 1.51 | † | (.19 | )† | 61 | †† | |||||||||||
| Class B | |||||||||||||||||||||||||||||||||||
| 2012 | 4.81 | (.09 | ) | 1.15 | 1.06 | .01 | — | .01 | 5.86 | 21.99 | 4,388 | 2.38 | 2.39 | (.27 | ) | 2.40 | (.29 | ) | 94 | ||||||||||||||||
| 2013 | 5.86 | (.07 | ) | 1.09 | 1.02 | .02 | — | .02 | 6.86 | 17.55 | 4,419 | 2.36 | 2.36 | (.10 | ) | 2.38 | (.12 | ) | 92 | ||||||||||||||||
| 2014 | 6.86 | (.06 | )(a) | .69 | .63 | — | .11 | .11 | 7.38 | 9.18 | 4,023 | 2.31 | 2.31 | (.79 | ) | 2.36 | (.84 | ) | 154 | ||||||||||||||||
| 2015 | 7.38 | (.05 | )(a) | .10 | .05 | — | 1.51 | 1.51 | 5.92 | .09 | 3,405 | 2.28 | 2.28 | (.82 | ) | 2.33 | (.87 | ) | 97 | ||||||||||||||||
| 2016 | 5.92 | (.04 | )(a) | .36 | .32 | — | .40 | .40 | 5.84 | 5.29 | 2,937 | 2.27 | 2.27 | (.72 | ) | 2.32 | (.77 | ) | 94 | ||||||||||||||||
| 2017(i) | 5.84 | (.03 | )(a) | .47 | .44 | .00 | (b) | — | .00 | 6.28 | 7.56 | †† | 2,756 | 2.25 | † | 2.25 | † | (.94 | )† | 2.30 | † | (.99 | )† | 61 | †† | ||||||||||
| Advisor Class | |||||||||||||||||||||||||||||||||||
| 2013(g) | 7.28 | .06 | .67 | .73 | — | — | — | 8.01 | 10.03 | †† | 1 | 1.27 | † | 1.27 | † | 1.46 | † | 4.88 | † | (2.15 | )† | 92 | †† | ||||||||||||
| 2014 | 8.01 | — | (a) | .82 | .82 | — | .11 | .11 | 8.72 | 10.24 | 66,590 | 1.06 | 1.06 | .53 | 1.11 | .48 | 154 | ||||||||||||||||||
| 2015 | 8.72 | .03 | (a) | .12 | .15 | — | 1.51 | 1.51 | 7.36 | 1.37 | 114,556 | 1.06 | 1.06 | .43 | 1.11 | .38 | 97 | ||||||||||||||||||
| 2016 | 7.36 | .04 | (a) | .44 | .48 | .01 | .40 | .41 | 7.43 | 6.48 | 169,088 | 1.05 | 1.05 | .53 | 1.10 | .48 | 94 | ||||||||||||||||||
| 2017(i) | 7.43 | .01 | (a) | .60 | .61 | .02 | — | .02 | 8.02 | 8.20 | †† | 201,554 | 1.05 | † | 1.05 | † | .27 | † | 1.10 | † | .22 | † | 61 | †† | |||||||||||
| Institutional Class | |||||||||||||||||||||||||||||||||||
| 2013(g) | 7.28 | .06 | .68 | .74 | — | — | — | 8.02 | 10.17 | †† | 1 | 1.14 | † | 1.14 | † | 1.55 | † | 4.59 | † | (1.90 | )† | 92 | †† | ||||||||||||
| 2014 | 8.02 | — | (a) | .84 | .84 | — | .11 | .11 | 8.75 | 10.48 | 3,001 | 1.03 | 1.03 | .48 | 1.08 | .43 | 154 | ||||||||||||||||||
| 2015 | 8.75 | .04 | (a) | .11 | .15 | — | 1.51 | 1.51 | 7.39 | 1.37 | 2,955 | 1.02 | 1.02 | .45 | 1.07 | .40 | 97 | ||||||||||||||||||
| 2016 | 7.39 | .04 | (a) | .45 | .49 | .01 | .40 | .41 | 7.47 | 6.61 | 3,288 | 1.01 | 1.01 | .55 | 1.06 | .50 | 94 | ||||||||||||||||||
| 2017(i) | 7.47 | .01 | (a) | .60 | .61 | .02 | — | .02 | 8.06 | 8.18 | †† | 3,453 | 1.01 | † | 1.01 | † | .31 | † | 1.06 | † | .26 | † | 61 | †† | |||||||||||
| 266 | 267 |
Financial Highlights (continued)
FIRST INVESTORS EQUITY FUNDS
| PER SHARE DATA | RATIOS / SUPPLEMENTAL DATA | ||||||||||||||||||||||||||||||||
| Ratio to Average Net | |||||||||||||||||||||||||||||||||
| Less Distributions | Ratio to Average | Assets Before Expenses | |||||||||||||||||||||||||||||||
| Investment Operations | from | Net Assets** | Waived or Assumed | ||||||||||||||||||||||||||||||
| Net Asset | Net Realized | Net Asset | |||||||||||||||||||||||||||||||
| Value, | Net | and Unrealized | Total from | Net | Net | Value, | Net Assets | Net Expenses | Net Expenses | Net | Net | Portfolio | |||||||||||||||||||||
| Beginning | Investment | Gain (Loss) on | Investment | Investment | Realized | Total | End of | Total | End of Period | After Fee | Before Fee | Investment | Investment | Turnover | |||||||||||||||||||
| of Period | Income | Investments | Operations | Income | Gain | Distributions | Period | Return* | (in thousands) | Credits | Credits*** | Income | Expenses*** | Loss | Rate | ||||||||||||||||||
| GROWTH & INCOME FUND | |||||||||||||||||||||||||||||||||
| Class A | |||||||||||||||||||||||||||||||||
| 2012 | $12.78 | $.21 | $ 3.81 | $ 4.02 | $.14 | $ — | $ .14 | $16.66 | 31.60 | % | $1,225,684 | 1.29 | % | 1.29 | % | 1.35 | % | N/A | N/A | 22 | % | ||||||||||||
| 2013 | 16.66 | .20 | 3.90 | 4.10 | .22 | — | .22 | 20.54 | 24.86 | 1,538,582 | 1.22 | 1.22 | 1.11 | N/A | N/A | 20 | |||||||||||||||||
| 2014 | 20.54 | .18 | (a) | 2.92 | 3.10 | .20 | .68 | .88 | 22.76 | 15.26 | 1,632,920 | 1.15 | 1.15 | .80 | N/A | N/A | 22 | ||||||||||||||||
| 2015 | 22.76 | .20 | (a) | (1.37 | ) | (1.17 | ) | .19 | 1.05 | 1.24 | 20.35 | (5.62 | ) | 1,496,803 | 1.15 | 1.15 | .89 | N/A | N/A | 23 | |||||||||||||
| 2016 | 20.35 | .26 | (a) | 2.07 | 2.33 | .24 | .93 | 1.17 | 21.51 | 11.72 | 1,588,423 | 1.16 | 1.16 | 1.28 | N/A | N/A | 23 | ||||||||||||||||
| 2017(i) | 21.51 | .13 | (a) | 1.42 | 1.55 | .21 | .75 | .96 | 22.10 | 7.40 | †† | 1,632,735 | 1.15 | † | 1.15 | † | 1.16 | † | N/A | N/A | 9 | †† | |||||||||||
| Class B | |||||||||||||||||||||||||||||||||
| 2012 | 12.01 | .10 | 3.58 | 3.68 | .05 | — | .05 | 15.64 | 30.71 | 27,306 | 1.99 | 1.99 | .63 | N/A | N/A | 22 | |||||||||||||||||
| 2013 | 15.64 | .06 | 3.67 | 3.73 | .11 | — | .11 | 19.26 | 24.02 | 27,762 | 1.96 | 1.96 | .37 | N/A | N/A | 20 | |||||||||||||||||
| 2014 | 19.26 | — | (a) | 2.73 | 2.73 | — | .68 | .68 | 21.31 | 14.32 | 25,497 | 1.93 | 1.93 | .02 | N/A | N/A | 22 | ||||||||||||||||
| 2015 | 21.31 | .02 | (a) | (1.27 | ) | (1.25 | ) | .04 | 1.05 | 1.09 | 18.97 | (6.33 | ) | 19,316 | 1.93 | 1.93 | .11 | N/A | N/A | 23 | |||||||||||||
| 2016 | 18.97 | .10 | (a) | 1.91 | 2.01 | .08 | .93 | 1.01 | 19.97 | 10.82 | 17,047 | 1.94 | 1.94 | .50 | N/A | N/A | 23 | ||||||||||||||||
| 2017(i) | 19.97 | .04 | (a) | 1.32 | 1.36 | .13 | .75 | .88 | 20.45 | 7.02 | †† | 15,526 | 1.93 | † | 1.93 | † | .38 | † | N/A | N/A | 9 | †† | |||||||||||
| Advisor Class | |||||||||||||||||||||||||||||||||
| 2013(g) | 18.49 | .13 | 2.00 | 2.13 | .08 | — | .08 | 20.54 | 11.53 | †† | 1 | .97 | † | .97 | † | 1.31 | † | 4.60 | %† | (2.32) | %† | 20 | †† | ||||||||||
| 2014 | 20.54 | .27 | (a) | 2.91 | 3.18 | .20 | .68 | .88 | 22.84 | 15.67 | 123,039 | .74 | .74 | 1.17 | N/A | N/A | 22 | ||||||||||||||||
| 2015 | 22.84 | .29 | (a) | (1.38 | ) | (1.09 | ) | .24 | 1.05 | 1.29 | 20.46 | (5.24 | ) | 141,229 | .75 | .75 | 1.29 | N/A | N/A | 23 | |||||||||||||
| 2016 | 20.46 | .35 | (a) | 2.08 | 2.43 | .29 | .93 | 1.22 | 21.67 | 12.18 | 132,486 | .77 | .77 | 1.68 | N/A | N/A | 23 | ||||||||||||||||
| 2017(i) | 21.67 | .17 | (a) | 1.43 | 1.60 | .23 | .75 | .98 | 22.29 | 7.59 | †† | 155,800 | .79 | † | .79 | † | 1.53 | † | N/A | N/A | 9 | †† | |||||||||||
| Institutional Class | |||||||||||||||||||||||||||||||||
| 2013(g) | 18.49 | .15 | 2.00 | 2.15 | .09 | — | .09 | 20.55 | 11.64 | †† | 1 | .78 | † | .78 | † | 1.50 | † | 4.19 | † | (1.91 | )† | 20 | †† | ||||||||||
| 2014 | 20.55 | .27 | (a) | 2.92 | 3.19 | .28 | .68 | .96 | 22.78 | 15.75 | 9,746 | .74 | .74 | 1.21 | N/A | N/A | 22 | ||||||||||||||||
| 2015 | 22.78 | .29 | (a) | (1.39 | ) | (1.10 | ) | .24 | 1.05 | 1.29 | 20.39 | (5.27 | ) | 9,380 | .75 | .75 | 1.29 | N/A | N/A | 23 | |||||||||||||
| 2016 | 20.39 | .35 | (a) | 2.07 | 2.42 | .30 | .93 | 1.23 | 21.58 | 12.18 | 10,596 | .74 | .74 | 1.70 | N/A | N/A | 23 | ||||||||||||||||
| 2017(i) | 21.58 | .17 | (a) | 1.44 | 1.61 | .25 | .75 | 1.00 | 22.19 | 7.64 | †† | 10,574 | .75 | † | .75 | † | 1.57 | † | N/A | N/A | 9 | †† | |||||||||||
| 268 | 269 |
Financial Highlights (continued)
FIRST INVESTORS EQUITY FUNDS
| PER SHARE DATA | RATIOS / SUPPLEMENTAL DATA | |||||||||||||||||||||||||||||||||||
| Ratio to Average Net | ||||||||||||||||||||||||||||||||||||
| Less Distributions | Ratio to Average | Assets Before Expenses | ||||||||||||||||||||||||||||||||||
| Investment Operations | from | Net Assets** | Waived or Assumed | |||||||||||||||||||||||||||||||||
| Net Asset | Net | Net Realized | Net Asset | Net | ||||||||||||||||||||||||||||||||
| Value, | Investment | and Unrealized | Total from | Net | Net | Value, | Net Assets | Net Expenses | Net Expenses | Investment | Net | Portfolio | ||||||||||||||||||||||||
| Beginning | Income | Gain (Loss) on | Investment | Investment | Realized | Total | End of | Total | End of Period | After Fee | Before Fee | Income | Investment | Turnover | ||||||||||||||||||||||
| of Period | (Loss) | Investments | Operations | Income | Gain | Distributions | Period | Return* | (in thousands) | Credits | Credits*** | (Loss) | Expenses*** | Loss | Rate | |||||||||||||||||||||
| HEDGED U.S. EQUITY OPPORTUNITIES FUND | ||||||||||||||||||||||||||||||||||||
| Class A | ||||||||||||||||||||||||||||||||||||
| 2016(d) | $10.00 | $ — | (a) | $ (.09 | ) | $ (.09 | ) | $ — | — | $ — | $ 9.91 | (.90 | )%†† | $ 9,265 | 1.75 | %† | 1.75 | %† | (.02 | )%† | 4.24 | %† | (2.51 | )%† | 7 | %†† | ||||||||||
| 2017(i) | 9.91 | (.01 | )(a) | .45 | .44 | — | — | — | 10.35 | 4.44 | †† | 34,618 | 1.75 | † | 1.75 | † | (.21 | )† | 1.97 | † | (.43 | )† �� | 35 | †† | ||||||||||||
| Advisor Class | ||||||||||||||||||||||||||||||||||||
| 2016(d) | 10.00 | — | (a) | (.09 | ) | (.09 | ) | — | — | — | 9.91 | (.90 | )†† | 24,539 | 1.42 | † | 1.42 | † | .26 | † | 3.37 | † | (1.69 | )† | 7 | †† | ||||||||||
| 2017(i) | 9.91 | — | (a) | .46 | .46 | .00 | (b) | — | .00 | 10.37 | 4.67 | †† | 34,010 | 1.42 | † | 1.42 | † | .10 | † | 1.55 | † | (.03 | )† | 35 | †† | |||||||||||
| Institutional Class | ||||||||||||||||||||||||||||||||||||
| 2016(d) | 10.00 | .01 | (a) | (.10 | ) | (.09 | ) | — | — | — | 9.91 | (.90 | )†† | 99 | 1.31 | † | 1.31 | † | .30 | † | 3.24 | † | (1.63 | )† | 7 | †† | ||||||||||
| 2017(i) | 9.91 | .01 | (a) | .46 | .47 | .00 | (b) | — | .00 | 10.38 | 4.76 | †† | 373 | 1.31 | † | 1.31 | † | .22 | † | 1.47 | † | .06 | † | 35 | †† | |||||||||||
| INTERNATIONAL FUND | ||||||||||||||||||||||||||||||||||||
| Class A | ||||||||||||||||||||||||||||||||||||
| 2012 | $ 9.54 | $ .10 | $ 2.20 | $ 2.30 | $ .16 | — | $ .16 | $11.68 | 24.34 | % | $165,797 | 1.82 | % | 1.82 | % | .86 | % | N/A | N/A | 41 | % | |||||||||||||||
| 2013 | 11.68 | .04 | .81 | .85 | — | — | — | 12.53 | 7.28 | 215,873 | 1.71 | 1.71 | .34 | N/A | N/A | 31 | ||||||||||||||||||||
| 2014 | 12.53 | .05 | (a) | .50 | .55 | .02 | — | .02 | 13.06 | 4.43 | 193,174 | 1.66 | 1.66 | .39 | N/A | N/A | 34 | |||||||||||||||||||
| 2015 | 13.06 | .05 | (a) | (.41 | ) | (.36 | ) | .05 | — | .05 | 12.65 | (2.78 | ) | 194,991 | 1.64 | 1.64 | .40 | N/A | N/A | 27 | ||||||||||||||||
| 2016 | 12.65 | .06 | (a) | 1.05 | 1.11 | .05 | — | .05 | 13.71 | 8.80 | 209,205 | 1.61 | 1.61 | .45 | N/A | N/A | 28 | |||||||||||||||||||
| 2017(i) | 13.71 | (.01 | )(a) | .29 | .28 | .07 | — | .07 | 13.92 | 2.09 | †† | 208,084 | 1.61 | † | 1.61 | † | (.12 | )† | N/A | N/A | 24 | †† | ||||||||||||||
| Class B | ||||||||||||||||||||||||||||||||||||
| 2012 | 9.24 | (.04 | ) | 2.19 | 2.15 | .14 | — | .14 | 11.25 | 23.50 | 3,328 | 2.52 | 2.52 | (.02 | ) | N/A | N/A | 41 | ||||||||||||||||||
| 2013 | 11.25 | (.11 | ) | .84 | .73 | — | — | — | 11.98 | 6.49 | 3,200 | 2.46 | 2.46 | (.45 | ) | N/A | N/A | 31 | ||||||||||||||||||
| 2014 | 11.98 | (.05 | )(a) | .47 | .42 | — | — | — | 12.40 | 3.51 | 2,893 | 2.49 | 2.49 | (.42 | ) | N/A | N/A | 34 | ||||||||||||||||||
| 2015 | 12.40 | (.06 | )(a) | (.38 | ) | (.44 | ) | — | — | — | 11.96 | (3.55 | ) | 2,094 | 2.47 | 2.47 | (.49 | ) | N/A | N/A | 27 | |||||||||||||||
| 2016 | 11.96 | (.06 | )(a) | 1.00 | .94 | .03 | — | .03 | 12.87 | 7.83 | 1,607 | 2.45 | 2.45 | (.45 | ) | N/A | N/A | 28 | ||||||||||||||||||
| 2017(i) | 12.87 | (.06 | )(a) | .28 | .22 | .05 | — | .05 | 13.04 | 1.72 | †† | 1,384 | 2.42 | † | 2.42 | † | (.97 | )† | N/A | N/A | 24 | †† | ||||||||||||||
| Advisor Class | ||||||||||||||||||||||||||||||||||||
| 2013(g) | 12.79 | .06 | (.30 | ) | (.24 | ) | — | — | — | 12.55 | (1.88 | )†† | 1 | 1.45 | † | 1.45 | † | .97 | † | 5.30 | %† | (2.88 | )%† | 31 | †† | |||||||||||
| 2014 | 12.55 | .14 | (a) | .44 | .58 | — | — | — | 13.13 | 4.62 | 35,249 | 1.27 | 1.27 | .98 | N/A | N/A | 34 | |||||||||||||||||||
| 2015 | 13.13 | .11 | (a) | (.43 | ) | (.32 | ) | .05 | — | .05 | 12.76 | (2.45 | ) | 57,623 | 1.24 | 1.24 | .83 | N/A | N/A | 27 | ||||||||||||||||
| 2016 | 12.76 | .11 | (a) | 1.06 | 1.17 | .06 | — | .06 | 13.87 | 9.22 | 81,525 | 1.23 | 1.24 | .85 | N/A | N/A | 28 | |||||||||||||||||||
| 2017(i) | 13.87 | .02 | (a) | .29 | .31 | .08 | — | .08 | 14.10 | 2.29 | †† | 96,311 | 1.20 | † | 1.20 | † | .32 | † | N/A | N/A | 24 | †† | ||||||||||||||
| Institutional Class | ||||||||||||||||||||||||||||||||||||
| 2013(g) | 12.79 | .08 | (.31 | ) | (.23 | ) | — | — | — | 12.56 | (1.80 | )†† | 1 | 1.19 | † | 1.19 | † | 1.23 | † | 4.84 | † | (2.42 | )† | 31 | †† | |||||||||||
| 2014 | 12.56 | .12 | (a) | .51 | .63 | — | — | — | 13.19 | 5.02 | 2,357 | 1.17 | 1.17 | .93 | N/A | N/A | 34 | |||||||||||||||||||
| 2015 | 13.19 | .12 | (a) | (.43 | ) | (.31 | ) | .10 | — | .10 | 12.78 | (2.33 | ) | 2,347 | 1.14 | 1.14 | .89 | N/A | N/A | 27 | ||||||||||||||||
| 2016 | 12.78 | .13 | (a) | 1.07 | 1.20 | .07 | — | .07 | 13.91 | 9.39 | 2,695 | 1.12 | 1.12 | .95 | N/A | N/A | 28 | |||||||||||||||||||
| 2017(i) | 13.91 | .03 | (a) | .28 | .31 | .09 | — | .09 | 14.13 | 2.29 | †† | 2,625 | 1.10 | † | 1.10 | † | .39 | † | N/A | N/A | 24 | †† | ||||||||||||||
| 270 | 271 |
Financial Highlights (continued)
FIRST INVESTORS EQUITY FUNDS
| PER SHARE DATA | RATIOS / SUPPLEMENTA L DATA | ||||||||||||||||||||||||||||||||||
| Ratio to Average Net | |||||||||||||||||||||||||||||||||||
| Less Distributions | Ratio to Average | Assets Before Expenses | |||||||||||||||||||||||||||||||||
| Investment Operations | from | Net Assets** | Waived or Assumed | ||||||||||||||||||||||||||||||||
| Net Asset | Net | Net Realized | Net Asset | Net | |||||||||||||||||||||||||||||||
| Value, | Investment | and Unrealized | Total from | Net | Net | Value, | Net Assets | Net Expenses | Net Expenses | Investment | Net | Portfolio | |||||||||||||||||||||||
| Beginning | Income | Gain (Loss) on | Investment | Investment | Realized | Total | End of | Total | End of Period | After Fee | Before Fee | Income | Investment | Turnover | |||||||||||||||||||||
| of Period | (Loss) | Investments | Operations | Income | Gain | Distributions | Period | Return* | (in thousands) | Credits | Credits*** | (Loss) | Expenses*** | Loss | Rate | ||||||||||||||||||||
| LONG SHORT FUND | |||||||||||||||||||||||||||||||||||
| Class A | |||||||||||||||||||||||||||||||||||
| 2017(c) | $10.00 | $(.05 | )(a) | $ .33 | $ .28 | — | — | — | $ 10.28 | 2.80 | %†† | $ 4,901 | 3.38 | %† | 3.38 | %† | (1.52 | )%† | 4.38 | %† | (2.52 | )%† | 45 | %†† | |||||||||||
| Advisor Class | |||||||||||||||||||||||||||||||||||
| 2017(c) | 10.00 | (.08 | )(a) | .38 | .30 | — | — | — | 10.30 | 3.00 | †† | 9,678 | 2.79 | † | 2.79 | † | (1.54 | )† | 3.65 | † | (2.40 | )† | 45 | †† | |||||||||||
| Institutional Class | |||||||||||||||||||||||||||||||||||
| 2017(c) | 10.00 | (.07 | )(a) | .37 | .30 | — | — | — | 10.30 | 3.00 | †† | 103 | 2.66 | † | 2.66 | † | (1.41 | )† | 3.59 | † | (2.34 | )† | 45 | †† | |||||||||||
| OPPORTUNITY FUND | |||||||||||||||||||||||||||||||||||
| Class A | |||||||||||||||||||||||||||||||||||
| 2012 | $24.07 | $ .26 | $6.10 | $6.36 | $.17 | $ .89 | $1.06 | $29.37 | 26.99 | % | $529,886 | 1.35 | % | 1.35 | % | .94 | % | N/A | N/A | 36 | % | ||||||||||||||
| 2013 | 29.37 | .18 | 9.64 | 9.82 | .26 | .80 | 1.06 | 38.13 | 34.47 | 726,942 | 1.28 | 1.28 | .56 | N/A | N/A | 40 | |||||||||||||||||||
| 2014 | 38.13 | .07 | (a) | 5.29 | 5.36 | .16 | 2.43 | 2.59 | 40.90 | 14.20 | 805,113 | 1.20 | 1.20 | .16 | N/A | N/A | 34 | ||||||||||||||||||
| 2015 | 40.90 | .04 | (a) | (.39 | ) | (.35 | ) | .06 | 2.70 | 2.76 | 37.79 | (1.16 | ) | 818,955 | 1.20 | 1.20 | .11 | N/A | N/A | 37 | |||||||||||||||
| 2016 | 37.79 | .20 | (a) | 2.52 | 2.72 | .04 | 3.18 | 3.22 | 37.29 | 7.39 | 880,274 | 1.22 | 1.22 | .54 | N/A | N/A | 36 | ||||||||||||||||||
| 2017(i) | 37.29 | .06 | (a) | 2.91 | 2.97 | .22 | 1.35 | 1.57 | 38.69 | 8.13 | †† | 933,355 | 1.20 | † | 1.21 | † | .34 | † | N/A | N/A | 19 | †† | |||||||||||||
| Class B | |||||||||||||||||||||||||||||||||||
| 2012 | 20.85 | .01 | 5.31 | 5.32 | .13 | .89 | 1.02 | 25.15 | 26.12 | 13,129 | 2.05 | 2.05 | .15 | N/A | N/A | 36 | |||||||||||||||||||
| 2013 | 25.15 | (.12 | ) | 8.26 | 8.14 | .22 | .80 | 1.02 | 32.27 | 33.49 | 13,677 | 2.02 | 2.02 | (.18 | ) | N/A | N/A | 40 | |||||||||||||||||
| 2014 | 32.27 | (.21 | )(a) | 4.47 | 4.26 | — | 2.43 | 2.43 | 34.10 | 13.32 | 12,145 | 1.99 | 1.99 | (.63 | ) | N/A | N/A | 34 | |||||||||||||||||
| 2015 | 34.10 | (.23 | )(a) | (.29 | ) | (.52 | ) | — | 2.70 | 2.70 | 30.88 | (1.94 | ) | 9,691 | 1.97 | 1.97 | (.67 | ) | N/A | N/A | 37 | ||||||||||||||
| 2016 | 30.88 | (.07 | )(a) | 2.05 | 1.98 | — | 3.18 | 3.18 | 29.68 | 6.58 | 8,606 | 1.99 | 1.99 | (.22 | ) | N/A | N/A | 36 | |||||||||||||||||
| 2017(i) | 29.68 | (.06 | )(a) | 2.30 | 2.24 | .18 | 1.35 | 1.53 | 30.39 | 7.72 | †† | 7,930 | 1.96 | † | 1.96 | † | (.42 | )† | N/A | N/A | 19 | †† | |||||||||||||
| Advisor Class | |||||||||||||||||||||||||||||||||||
| 2013(g) | 33.13 | .16 | 4.89 | 5.05 | — | — | — | 38.18 | 15.24 | †† | 1 | .98 | † | .98 | † | .91 | † | 4.48 | %† | (2.59 | )%† | 40 | †† | ||||||||||||
| 2014 | 38.18 | .23 | (a) | 5.22 | 5.45 | — | 2.43 | 2.43 | 41.20 | 14.43 | 35,733 | .90 | .90 | .51 | N/A | N/A | 34 | ||||||||||||||||||
| 2015 | 41.20 | .16 | (a) | (.40 | ) | (.24 | ) | .08 | 2.70 | 2.78 | 38.18 | (.87 | ) | 48,322 | .91 | .91 | .40 | N/A | N/A | 37 | |||||||||||||||
| 2016 | 38.18 | .30 | (a) | 2.56 | 2.86 | .07 | 3.18 | 3.25 | 37.79 | 7.69 | 73,477 | .93 | .93 | .83 | N/A | N/A | 36 | ||||||||||||||||||
| 2017(i) | 37.79 | .12 | (a) | 2.95 | 3.07 | .24 | 1.35 | 1.59 | 39.27 | 8.30 | †† | 88,552 | .91 | † | .91 | † | .64 | † | N/A | N/A | 19 | †† | |||||||||||||
| Institutional Class | |||||||||||||||||||||||||||||||||||
| 2013(g) | 33.13 | .19 | 4.89 | 5.08 | — | — | — | 38.21 | 15.33 | †† | 1 | .85 | † | .85 | † | 1.06 | † | 4.17 | † | (2.26 | )† | 40 | †† | ||||||||||||
| 2014 | 38.21 | .24 | (a) | 5.30 | 5.54 | .17 | 2.43 | 2.60 | 41.15 | 14.66 | 3,838 | .79 | .79 | .58 | N/A | N/A | 34 | ||||||||||||||||||
| 2015 | 41.15 | .22 | (a) | (.40 | ) | (.18 | ) | .20 | 2.70 | 2.90 | 38.07 | (.74 | ) | 4,228 | .78 | .78 | .52 | N/A | N/A | 37 | |||||||||||||||
| 2016 | 38.07 | .36 | (a) | 2.54 | 2.90 | .08 | 3.18 | 3.26 | 37.71 | 7.84 | 4,975 | .79 | .79 | .98 | N/A | N/A | 36 | ||||||||||||||||||
| 2017(i) | 37.71 | .15 | (a) | 2.95 | 3.10 | .26 | 1.35 | 1.61 | 39.20 | 8.39 | †† | 5,388 | .78 | † | .78 | † | .76 | † | N/A | N/A | 19 | †† | |||||||||||||
| 272 | 273 |
Financial Highlights (continued)
FIRST INVESTORS EQUITY FUNDS
| PER SHARE DATA | RATIOS / SUPPLEMENTAL DATA | ||||||||||||||||||||||||||||||||||
| Ratio to Average Net | |||||||||||||||||||||||||||||||||||
| Less Distributions | Ratio to Average | Assets Before Expenses | |||||||||||||||||||||||||||||||||
| Investment Operations | from | Net Assets** | Waived or Assumed | ||||||||||||||||||||||||||||||||
| Net Asset | Net | Net Realized | Net Asset | Net | Net | ||||||||||||||||||||||||||||||
| Value, | Investment | and Unrealized | Total from | Net | Net | Value, | Net Assets | Net Expenses | Net Expenses | Investment | Investment | Portfolio | |||||||||||||||||||||||
| Beginning | Income | Gain (Loss) on | Investment | Investment | Realized | Total | End of | Total | End of Period | After Fee | Before Fee | Income | Income | Turnover | |||||||||||||||||||||
| of Period | (Loss) | Investments | Operations | Income | Gain | Distributions | Period | Return* | (in thousands) | Credits | Credits*** | (Loss) | Expenses*** | (Loss) | Rate | ||||||||||||||||||||
| REAL ESTATE FUND | |||||||||||||||||||||||||||||||||||
| Class A | |||||||||||||||||||||||||||||||||||
| 2015(f) | $10.00 | $ .09 | (a) | $(1.06 | ) | $(.97 | ) | $.07 | $ — | $ .07 | $ 8.96 | (9.67 | %†† | $ 11,410 | 1.45 | %† | 1.45 | %† | 1.99 | %† | 2.31 | %† | 1.13 | %† | 18 | %†† | |||||||||
| 2016 | 8.96 | .24 | (a) | 1.11 | 1.35 | .18 | .02 | .20 | 10.11 | 15.19 | 27,741 | 1.45 | 1.45 | 2.47 | 1.54 | 2.38 | 31 | ||||||||||||||||||
| 2017(i) | 10.11 | .15 | (a) | (.38 | ) | (.23 | ) | .09 | .14 | .23 | 9.65 | (2.18 | )†† | 38,134 | 1.45 | † | 1.45 | † | 3.02 | † | 1.48 | † | 2.99 | † | 7 | †† | |||||||||
| Advisor Class | |||||||||||||||||||||||||||||||||||
| 2015(f) | 10.00 | .11 | (a) | (1.06 | ) | (.95 | ) | .07 | — | .07 | 8.98 | (9.45 | )†† | 40,824 | 1.12 | † | 1.12 | † | 2.36 | † | 1.63 | † | 1.85 | † | 18 | †† | |||||||||
| 2016 | 8.98 | .27 | (a) | 1.13 | 1.40 | .21 | .02 | .23 | 10.15 | 15.66 | 55,218 | 1.12 | 1.12 | 2.75 | 1.21 | 2.66 | 31 | † | |||||||||||||||||
| 2017(i | 10.15 | .17 | (a) | (.39 | ) | (.22 | ) | .13 | .14 | .27 | 9.66 | (2.10 | )†† | 62,459 | 1.12 | † | 1.12 | † | 3.49 | † | 1.10 | † | 3.51 | † | 7 | †† | |||||||||
| Institutional Class | |||||||||||||||||||||||||||||||||||
| 2015(f) | 10.00 | .09 | (a) | (1.04 | ) | (.95 | ) | .09 | — | .09 | 8.96 | (9.45 | )†† | 963 | 1.00 | † | 1.00 | † | 2.08 | † | 2.18 | † | .90 | † | 18 | †† | |||||||||
| 2016 | 8.96 | .28 | (a) | 1.13 | 1.41 | .21 | .02 | .23 | 10.14 | 15.89 | 634 | 1.00 | 1.00 | 2.87 | 1.06 | 2.81 | 31 | ||||||||||||||||||
| 2017(i) | 10.14 | .20 | (a) | (.42 | ) | (.22 | ) | .13 | .14 | .27 | 9.65 | (2.05 | )†† | 581 | 1.02 | † | 1.02 | † | 4.20 | † | .99 | † | 4.23 | † | 7 | †† | |||||||||
| SELECT GROWTH FUND | |||||||||||||||||||||||||||||||||||
| Class A | |||||||||||||||||||||||||||||||||||
| 2012 | $ 6.31 | $(.03 | ) | $1.70 | $ 1.67 | $ — | $ — | $ — | $ 7.98 | 26.47 | % | $ 271,019 | 1.42 | % | 1.42 | % | (.35 | )% | N/A | N/A | 53 | % | |||||||||||||
| 2013 | 7.98 | .02 | 1.24 | 1.26 | — | — | — | 9.24 | 15.79 | 315,833 | 1.35 | 1.35 | .25 | N/A | N/A | 71 | |||||||||||||||||||
| 2014 | 9.24 | — | (a) | 1.73 | 1.73 | .00 | (b) | — | .00 | (b) | 10.97 | 18.77 | 330,595 | 1.27 | 1.27 | .03 | N/A | N/A | 33 | ||||||||||||||||
| 2015 | 10.97 | .02 | (a) | .65 | .67 | .00 | (b) | — | .00 | (b) | 11.64 | 6.12 | 352,651 | 1.25 | 1.25 | .16 | N/A | N/A | 48 | ||||||||||||||||
| 2016 | 11.64 | .02 | (a) | .73 | .75 | .02 | 1.13 | 1.15 | 11.24 | 6.50 | 373,279 | 1.27 | 1.27 | .22 | N/A | N/A | 59 | ||||||||||||||||||
| 2017(i) | 11.24 | — | (a) | 1.00 | 1.00 | .03 | 1.55 | 1.58 | 10.66 | 9.93 | †† | 398,761 | 1.26 | † | 1.26 | † | .04 | † | N/A | N/A | 29 | †† | |||||||||||||
| Class B | |||||||||||||||||||||||||||||||||||
| 2012 | 5.77 | (.09 | ) | 1.57 | 1.48 | — | — | — | 7.25 | 25.65 | 5,853 | 2.12 | 2.12 | (1.07 | ) | N/A | N/A | 53 | |||||||||||||||||
| 2013 | 7.25 | (.06 | ) | 1.15 | 1.09 | — | — | — | 8.34 | 15.03 | 5,308 | 2.10 | 2.10 | (.48 | ) | N/A | N/A | 71 | |||||||||||||||||
| 2014 | 8.34 | (.07 | )(a) | 1.55 | 1.48 | — | — | — | 9.82 | 17.75 | 4,868 | 2.06 | 2.06 | (.76 | ) | N/A | N/A | 33 | |||||||||||||||||
| 2015 | 9.82 | (.07 | )(a) | .59 | .52 | — | — | — | 10.34 | 5.30 | 4,101 | 2.03 | 2.03 | (.63 | ) | N/A | N/A | 48 | |||||||||||||||||
| 2016 | 10.34 | (.06 | )(a) | .65 | .59 | .00 | (b) | 1.13 | 1.13 | 9.80 | 5.71 | 3,393 | 2.03 | 2.03 | (.56 | ) | N/A | N/A | 59 | ||||||||||||||||
| 2017(i) | 9.80 | (.03 | )(a) | .85 | .82 | .02 | 1.55 | 1.57 | 9.05 | 9.46 | †† | 3,201 | 2.00 | † | 2.00 | † | (.69 | )† | N/A | N/A | 29 | †† | |||||||||||||
| Advisor Class | |||||||||||||||||||||||||||||||||||
| 2013(g) | 8.46 | .01 | .79 | .80 | — | — | — | 9.26 | 9.46 | †† | 1 | 1.02 | † | 1.02 | † | .25 | † | 4.63 | %† | (3.36 | )%† | 71 | †† | ||||||||||||
| 2014 | 9.26 | .06 | (a) | 1.69 | 1.75 | — | — | — | 11.01 | 18.90 | 31,902 | .83 | .83 | .51 | N/A | N/A | 33 | ||||||||||||||||||
| 2015 | 11.01 | .07 | (a) | .66 | .73 | .01 | — | .01 | 11.73 | 6.61 | 46,793 | .84 | .84 | .57 | N/A | N/A | 48 | ||||||||||||||||||
| 2016 | 11.73 | .07 | (a) | .73 | .80 | .03 | 1.13 | 1.16 | 11.37 | 6.93 | 66,588 | .85 | .86 | .62 | N/A | N/A | 59 | ||||||||||||||||||
| 2017(i) | 11.37 | .02 | (a) | 1.01 | 1.03 | .04 | 1.55 | 1.59 | 10.81 | 10.14 | †† | 80,542 | .84 | † | .84 | † | .45 | † | N/A | N/A | 29 | †† | |||||||||||||
| Institutional Class | |||||||||||||||||||||||||||||||||||
| 2013(g) | 8.46 | .02 | .79 | .81 | — | — | — | 9.27 | 9.57 | †† | 1 | .89 | † | .89 | † | .39 | † | 4.32 | † | (3.04 | )† | 71 | †† | ||||||||||||
| 2014 | 9.27 | .05 | (a) | 1.74 | 1.79 | — | — | — | 11.06 | 19.31 | 3,057 | .83 | .83 | .48 | N/A | N/A | 33 | ||||||||||||||||||
| 2015 | 11.06 | .07 | (a) | .66 | .73 | .02 | — | .02 | 11.77 | 6.56 | 3,608 | .82 | .82 | .59 | N/A | N/A | 48 | ||||||||||||||||||
| 2016 | 11.77 | .07 | (a) | .74 | .81 | .03 | 1.13 | 1.16 | 11.42 | 7.00 | 3,915 | .83 | .83 | .66 | N/A | N/A | 59 | ||||||||||||||||||
| 2017(i) | 11.42 | .03 | (a) | 1.01 | 1.04 | .04 | 1.55 | 1.59 | 10.87 | 10.21 | †† | 4,447 | .82 | † | .82 | † | .47 | † | N/A | N/A | 29 | †† | |||||||||||||
| 274 | 275 |
Financial Highlights (continued)
FIRST INVESTORS EQUITY FUNDS
| PER SHARE DATA | RATIOS / SUPPLEMENTAL DATA | ||||||||||||||||||||||||||||||||||
| Ratio to Average Net | |||||||||||||||||||||||||||||||||||
| Less Distributions | Ratio to Average | Assets Before Expenses | |||||||||||||||||||||||||||||||||
| Investment Operations | from | Net Assets** | Waived or Assumed | ||||||||||||||||||||||||||||||||
| Net Asset | Net | Net Realized | Net Asset | Net | Net | ||||||||||||||||||||||||||||||
| Value, | Investment | and Unrealized | Total from | Net | Net | Value, | Net Assets | Net Expenses | Net Expenses | Investment | Investment | Portfolio | |||||||||||||||||||||||
| Beginning | Income | Gain on | Investment | Investment | Realized | Total | End of | Total | End of Period | After Fee | Before Fee | Income | Income | Turnover | |||||||||||||||||||||
| of Period | (Loss) | Investments | Operations | Income | Gain | Distributions | Period | Return* | (in thousands) | Credits | Credits*** | (Loss) | Expenses*** | (Loss) | Rate | ||||||||||||||||||||
| SPECIAL SITUATIONS FUND | |||||||||||||||||||||||||||||||||||
| Class A | |||||||||||||||||||||||||||||||||||
| 2012 | $21.72 | $ .01 | $4.46 | $4.47 | $.03 | $1.76 | $1.79 | $24.40 | 21.19 | % | $342,939 | 1.43 | % | 1.43 | % | .03 | % | 1.53 | % | (.07 | )% | 41 | % | ||||||||||||
| 2013 | 24.40 | .11 | 4.68 | 4.79 | .12 | 1.00 | 1.12 | 28.07 | 20.47 | 412,102 | 1.39 | 1.39 | .42 | 1.47 | .34 | 110 | |||||||||||||||||||
| 2014 | 28.07 | .02 | (a) | 3.16 | 3.18 | — | 4.60 | 4.60 | 26.65 | 11.65 | 425,957 | 1.33 | 1.33 | .06 | 1.38 | .01 | 55 | ||||||||||||||||||
| 2015 | 26.65 | .02 | (a) | .07 | .09 | .04 | 1.43 | 1.47 | 25.27 | .12 | 432,235 | 1.32 | 1.32 | .07 | 1.33 | .06 | 43 | ||||||||||||||||||
| 2016 | 25.27 | .17 | (a) | 2.36 | 2.53 | .02 | 1.44 | 1.46 | 26.34 | 10.35 | 472,720 | 1.33 | 1.34 | .68 | 1.34 | .68 | 39 | ||||||||||||||||||
| 2017(i) | 26.34 | .02 | (a) | 2.77 | 2.79 | .16 | .24 | .40 | 28.73 | 10.62 | †† | 513,007 | 1.32 | † | 1.32 | † | .13 | † | 1.32 | † | .13 | † | 17 | †† | |||||||||||
| Class B | |||||||||||||||||||||||||||||||||||
| 2012 | 18.74 | (.15 | ) | 3.84 | 3.69 | — | 1.76 | 1.76 | 20.67 | 20.33 | 5,085 | 2.13 | 2.13 | (.67 | ) | 2.23 | (.77 | ) | 41 | ||||||||||||||||
| 2013 | 20.67 | (.10 | ) | 3.96 | 3.86 | .08 | 1.00 | 1.08 | 23.45 | 19.62 | 4,932 | 2.13 | 2.13 | (.29 | ) | 2.21 | (.37 | ) | 110 | ||||||||||||||||
| 2014 | 23.45 | (.17 | )(a) | 2.62 | 2.45 | — | 4.60 | 4.60 | 21.30 | 10.71 | 4,441 | 2.16 | 2.16 | (.77 | ) | 2.21 | (.82 | ) | 55 | ||||||||||||||||
| 2015 | 21.30 | (.16 | )(a) | .08 | (.08 | ) | — | 1.43 | 1.43 | 19.79 | (.67 | ) | 3,618 | 2.13 | 2.13 | (.74 | ) | 2.14 | (.75 | ) | 43 | ||||||||||||||
| 2016 | 19.79 | (.02 | )(a) | 1.81 | 1.79 | — | 1.44 | 1.44 | 20.14 | 9.43 | 3,301 | 2.14 | 2.14 | (.12 | ) | 2.15 | (.13 | ) | 39 | ||||||||||||||||
| 2017(i) | 20.14 | (.07 | )(a) | 2.12 | 2.05 | .13 | .24 | .37 | 21.82 | 10.19 | †† | 3,207 | 2.11 | † | 2.11 | † | (.66 | )† | 2.11 | † | (.66 | )† | 17 | †† | |||||||||||
| Advisor Class | |||||||||||||||||||||||||||||||||||
| 2013(g) | 25.71 | .01 | 2.37 | 2.38 | — | — | — | 28.09 | 9.26 | †† | 1 | 1.16 | † | 1.16 | † | .08 | † | 4.82 | † | (3.58 | )† | 110 | †† | ||||||||||||
| 2014 | 28.09 | .12 | (a) | 3.10 | 3.22 | — | 4.60 | 4.60 | 26.71 | 11.82 | 26,458 | 1.01 | 1.01 | .39 | 1.06 | .34 | 55 | ||||||||||||||||||
| 2015 | 26.71 | .10 | (a) | .08 | .18 | .08 | 1.43 | 1.51 | 25.38 | .46 | 38,790 | 1.02 | 1.03 | .37 | 1.04 | .36 | 43 | ||||||||||||||||||
| 2016 | 25.38 | .23 | (a) | 2.39 | 2.62 | .04 | 1.44 | 1.48 | 26.52 | 10.67 | 59,159 | 1.03 | 1.03 | .94 | 1.04 | .93 | 39 | ||||||||||||||||||
| 2017(i) | 26.52 | .06 | (a) | 2.79 | 2.85 | .18 | .24 | .42 | 28.95 | 10.77 | †† | 69,042 | 1.02 | † | 1.02 | † | .43 | † | 1.02 | † | .43 | † | 17 | †† | |||||||||||
| Institutional Class | |||||||||||||||||||||||||||||||||||
| 2013(g) | 25.71 | .06 | 2.37 | 2.43 | — | — | — | 28.14 | 9.45 | †† | 1 | .84 | † | .84 | † | .42 | † | 4.43 | † | (3.17 | )† | 110 | †† | ||||||||||||
| 2014 | 28.14 | .14 | (a) | 3.16 | 3.30 | — | 4.60 | 4.60 | 26.84 | 12.10 | 5,750 | .89 | .89 | .51 | .94 | .46 | 55 | ||||||||||||||||||
| 2015 | 26.84 | .14 | (a) | .08 | .22 | .16 | 1.43 | 1.59 | 25.47 | .60 | 5,905 | .88 | .88 | .51 | .89 | .50 | 43 | ||||||||||||||||||
| 2016 | 25.47 | .28 | (a) | 2.39 | 2.67 | .05 | 1.44 | 1.49 | 26.65 | 10.84 | 6,914 | .88 | .89 | 1.11 | .90 | 1.10 | 39 | ||||||||||||||||||
| 2017(i) | 26.65 | .08 | (a) | 2.80 | 2.88 | .18 | .24 | .42 | 29.11 | 10.85 | †† | 7,937 | .88 | † | .88 | † | .56 | † | .88 | † | .56 | † | 17 | †† | |||||||||||
| 276 | 277 |
Financial Highlights (continued)
FIRST INVESTORS EQUITY FUNDS
| PER SHARE DATA | RATIOS / SUPPLEMENTAL DATA | ||||||||||||||||||||||||||||||||
| Ratio to Average Net | |||||||||||||||||||||||||||||||||
| Less Distributions | Ratio to Average | Assets Before Expenses | |||||||||||||||||||||||||||||||
| Investment Operations | from | Net Assets** | Waived or Assumed | ||||||||||||||||||||||||||||||
| Net Asset | Net Realized | Net Asset | |||||||||||||||||||||||||||||||
| Value, | Net | and Unrealized | Total from | Net | Net | Value, | Net Assets | Net Expenses | Net Expenses | Net | Net | Portfolio | |||||||||||||||||||||
| Beginning | Investment | Gain (Loss) on | Investment | Investment | Realized | Total | End of | Total | End of Period | After Fee | Before Fee | Investment | Investment | Turnover | |||||||||||||||||||
| of Period | Income | Investments | Operations | Income | Gain | Distributions | Period | Return* | (in thousands) | Credits | Credits*** | Income | Expenses*** | Loss | Rate | ||||||||||||||||||
| TOTAL RETURN FUND | |||||||||||||||||||||||||||||||||
| Class A | |||||||||||||||||||||||||||||||||
| 2012 | $14.10 | $.30 | $2.71 | $3.01 | $.30 | $ — | $.30 | $16.81 | 21.46 | % | $532,551 | 1.32 | % | 1.32 | % | 1.79 | % | N/A | N/A | 32 | % | ||||||||||||
| 2013 | 16.81 | .27 | 1.99 | 2.26 | .34 | .24 | .58 | 18.49 | 13.77 | 664,054 | 1.26 | 1.26 | 1.45 | N/A | N/A | 32 | |||||||||||||||||
| 2014 | 18.49 | .22 | (a) | 1.65 | 1.87 | .31 | .42 | .73 | 19.63 | 10.18 | 767,354 | 1.19 | 1.19 | 1.14 | N/A | N/A | 44 | ||||||||||||||||
| 2015 | 19.63 | .21 | (a) | (.68 | ) | (.47 | ) | .28 | .67 | .95 | 18.21 | (2.65 | ) | 784,281 | 1.18 | 1.18 | 1.05 | N/A | N/A | 40 | |||||||||||||
| 2016 | 18.21 | .23 | (a) | 1.26 | 1.49 | .27 | .43 | .70 | 19.00 | 8.36 | 845,726 | 1.19 | 1.19 | 1.27 | N/A | N/A | 63 | ||||||||||||||||
| 2017(i) | 19.00 | .12 | (a) | .56 | .68 | .16 | .30 | .46 | 19.22 | 3.65 | †† | 859,299 | 1.19 | † | 1.19 | † | 1.23 | † | N/A | N/A | 21 | †† | |||||||||||
| Class B | |||||||||||||||||||||||||||||||||
| 2012 | 13.88 | .18 | 2.65 | 2.83 | .18 | — | .18 | 16.53 | 20.49 | 10,872 | 2.02 | 2.02 | 1.09 | N/A | N/A | 32 | |||||||||||||||||
| 2013 | 16.53 | .15 | 1.95 | 2.10 | .22 | .24 | .46 | 18.17 | 12.98 | 10,207 | 2.01 | 2.01 | .71 | N/A | N/A | 32 | |||||||||||||||||
| 2014 | 18.17 | .07 | (a) | 1.61 | 1.68 | .16 | .42 | .58 | 19.27 | 9.29 | 10,016 | 1.97 | 1.97 | .36 | N/A | N/A | 44 | ||||||||||||||||
| 2015 | 19.27 | .06 | (a) | (.68 | ) | (.62 | ) | .06 | .67 | .73 | 17.92 | (3.44 | ) | 8,270 | 1.96 | 1.96 | .27 | N/A | N/A | 40 | |||||||||||||
| 2016 | 17.92 | .09 | (a) | 1.25 | 1.34 | .13 | .43 | .56 | 18.70 | 7.61 | 7,774 | 1.96 | 1.96 | .50 | N/A | N/A | 63 | ||||||||||||||||
| 2017(i) | 18.70 | .05 | (a) | .54 | .59 | .09 | .30 | .39 | 18.90 | 3.22 | †† | 7,427 | 1.94 | † | 1.94 | † | .48 | † | N/A | N/A | 21 | †† | |||||||||||
| Advisor Class | |||||||||||||||||||||||||||||||||
| 2013(g) | 17.62 | .09 | .95 | 1.04 | .17 | — | .17 | 18.49 | 5.89 | †† | 1 | 1.01 | † | 1.01 | † | 1.40 | † | 4.76 | %† | (2.35 | )%† | 32 | †† | ||||||||||
| 2014 | 18.49 | .29 | (a) | 1.60 | 1.89 | .32 | .42 | .74 | 19.64 | 10.34 | 2,106 | .78 | .78 | 1.46 | N/A | N/A | 44 | ||||||||||||||||
| 2015 | 19.64 | .29 | (a) | (.69 | ) | (.40 | ) | .31 | .67 | .98 | 18.26 | (2.24 | ) | 976 | .78 | .78 | 1.44 | N/A | N/A | 40 | |||||||||||||
| 2016 | 18.26 | .26 | (a) | 1.27 | 1.53 | .32 | .43 | .75 | 19.04 | 8.55 | 1,213 | .82 | .82 | 1.63 | N/A | N/A | 63 | ||||||||||||||||
| 2017(i) | 19.04 | .16 | (a) | .60 | .76 | .19 | .30 | .49 | 19.31 | 4.06 | †† | 1,066 | .79 | † | .79 | † | 1.62 | † | N/A | N/A | 21 | †† | |||||||||||
| Institutional Class | |||||||||||||||||||||||||||||||||
| 2013(g) | 17.62 | .10 | .95 | 1.05 | .17 | — | .17 | 18.50 | 5.98 | †† | 1 | .82 | † | .82 | † | 1.48 | † | 4.35 | † | (2.05 | )† | 32 | †† | ||||||||||
| 2014 | 18.50 | .30 | (a) | 1.63 | 1.93 | .36 | .42 | .78 | 19.65 | 10.55 | 2,885 | .78 | .78 | 1.55 | N/A | N/A | 44 | ||||||||||||||||
| 2015 | 19.65 | .29 | (a) | (.70 | ) | (.41 | ) | .28 | .67 | .95 | 18.29 | (2.28 | ) | 30,644 | .77 | .77 | 1.47 | N/A | N/A | 40 | |||||||||||||
| 2016 | 18.29 | .31 | (a) | 1.28 | 1.59 | .32 | .43 | .75 | 19.13 | 8.88 | 32,525 | .77 | .77 | 1.68 | N/A | N/A | 63 | ||||||||||||||||
| 2017(i) | 19.13 | .16 | (a) | .56 | .72 | .19 | .30 | .49 | 19.36 | 3.83 | †† | 33,615 | .77 | † | .77 | † | 1.65 | † | N/A | N/A | 21 | †† | |||||||||||
| * | Calculated without sales charges. | |
| ** | Net of expenses waived or assumed (Note 3). | |
| *** | The ratios do not include a reduction of expenses from cash balances maintained with the custodian or | |
| from brokerage service arrangements (Note 1G). | ||
| † | Annualized | |
| †† | Not annualized | |
| (a) | Based on average shares during the period. | |
| (b) | Due to rounding, amount is less than .005 per share. | |
| (c) | For the period December 1, 2016 (commencement of operations) to March 31, 2017. | |
| (d) | For the period August 1, 2016 (commencement of operations) to September 30, 2016. | |
| (e) | For the period April 1, 2016 (commencement of operations) to September 30, 2016. | |
| (f) | For the period April 6, 2015 (commencement of operations) to September 30, 2015. | |
| (g) | For the period April 1, 2013 (commencement of operations) to September 30, 2013. | |
| (h) | Prior to September 4, 2012, known as Value Fund. | |
| (i) | For the period October 1, 2016 to March 31, 2017. |
| 278 | See notes to financial statements | 279 | |
Report of Independent Registered Public Accounting Firm
To the Shareholders and Board of Trustees of
First Investors Income Funds and First Investors Equity Funds
We have audited the accompanying statements of assets and liabilities, including the portfolios of investments of the Balanced Income Fund, Floating Rate Fund, Fund For Income, Government Fund, Government Cash Management Fund, International Opportunities Bond Fund, Investment Grade Fund, Limited Duration High Quality Bond Fund and Strategic Income Fund (each a series of First Investors Income Funds), and the Covered Call Strategy Fund, Equity Income Fund, Global Fund, Growth & Income Fund, Hedged U.S. Equity Opportunities Fund, International Fund, Long Short Fund, Opportunity Fund, Real Estate Fund, Select Growth Fund, Special Situations Fund and Total Return Fund (each a series of First Investors Equity Funds), as of March 31, 2017, the related statements of operations, the statements of changes in net assets, and the financial highlights for each of the periods indicated thereon. We have audited the statement of cash flows of the Long Short Fund for the period December 1, 2016 (inception) to March 31, 2017. These financial statements and financial highlights are the responsibility of the Funds’ management. Our responsibility is to express an opinion on these financial statements and financial highlights based on our audits.
We conducted our audits in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements and financial highlights are free of material misstatement. The Funds are not required to have, nor were we engaged to perform an audit of the Funds’ internal control over financial reporting. Our audits included consideration of internal control over financial reporting as a basis for designing audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Funds’ internal control over financial reporting. Accordingly, we express no such opinion. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. Our procedures included confirmation of securities owned as of March 31, 2017, by correspondence with the custodian, brokers and agent banks. Where brokers and agent banks have not replied to our confirmation requests, we have carried out other appropriate auditing procedures. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion.
| 280 |
In our opinion, the financial statements and financial highlights referred to above present fairly, in all material respects, the financial position of the Balanced Income Fund, Floating Rate Fund, Fund For Income, Government Fund, Government Cash Management Fund, International Opportunities Bond Fund, Investment Grade Fund, Limited Duration High Quality Bond Fund, Strategic Income Fund, and the Covered Call Strategy Fund, Equity Income Fund, Global Fund, Growth & Income Fund, Hedged U.S. Equity Opportunities Fund, International Fund, Long Short Fund, Opportunity Fund, Real Estate Fund, Select Growth Fund, Special Situations Fund and Total Return Fund, as of March 31, 2017, and the results of their operations, its cash flows (with respect to Long Short Fund), changes in their net assets, and their financial highlights for the periods presented, in conformity with accounting principles generally accepted in the United States of America.
| Tait, Weller & Baker LLP |
Philadelphia, Pennsylvania
May 26, 2017
| 281 |
Board Considerations of Advisory Contracts and Fees
(unaudited)
FIRST INVESTORS EQUITY FUNDS
Consideration of the Investment Advisory Agreement with Foresters Investment Management Company, Inc. and the Sub-Advisory Agreement with Lazard Asset Management LLC with respect to the First Investors Long Short Fund
At the November 17, 2016 meeting (the “November Meeting”) of the Board of Trustees (the “Board” or the “Trustees”) of the First Investors Equity Funds (the “Trust”), the Board, including a majority of Board members who are not interested persons of the Trust under the Investment Company Act of 1940, as amended (the “Independent Trustees”), discussed and approved, for the new First Investors Long Short Fund (the “New Fund”), the investment advisory agreement (the “Advisory Agreement”) with Foresters Investment Management Company, Inc. (“FIMCO”) and the sub-advisory agreement (the “Sub-Advisory Agreement”) with Lazard Asset Management LLC (“Lazard,” and together with FIMCO, the “Advisers”).
The Trustees were provided with preliminary materials relating to the New Fund by FIMCO and Lazard initially in connection with a special Board meeting held on August 18, 2016 (the “August Meeting”) and then more detailed materials by the Advisers in advance of and at the November Meeting. The Trustees also met in person with senior officers of FIMCO, Trust counsel, independent legal counsel to the Independent Trustees (“Independent Legal Counsel”) and others to receive information on, and discuss the approval of, the Advisory Agreement and Sub-Advisory Agreement. In addition, the Trustees met in person with representatives of Lazard at the August Meeting and representatives of Lazard also participated in the November Meeting via teleconference. The material factors and conclusions that formed the basis for the approval of the Advisory Agreement and Sub-Advisory Agreement are discussed below.
In making their determinations, the Trustees took into account management style, investment strategies, investment philosophy and process, Lazard’s past performance and the Advisers’ personnel that would be serving the New Fund. In evaluating the Advisory Agreement and Sub-Advisory Agreement, the Trustees also reviewed information provided by the Advisers, including the terms of such Agreements and information regarding fee arrangements, including the structure of the advisory fee and sub-advisory fee, the method of computing fees, and the frequency of payment of fees. The Trustees also reviewed information comparing the New Fund’s advisory fee rate and projected total expenses with a peer group of other similar funds compiled by Broadridge Financial Solutions, Inc. (“Broadridge”), an independent provider of investment company data. In addition, the Trustees reviewed, among other things, information regarding Lazard’s compliance program, financial condition, insurance coverage and brokerage practices.
| 282 |
After discussion and consideration among themselves, and with the Advisers, Trust counsel and Independent Legal Counsel, including during an executive session with Independent Legal Counsel held the day before the November Meeting, the Trustees concluded as follows with respect to the New Fund:
• The nature and extent of the investment advisory services to be provided to the New Fund by the Advisers were consistent with the terms of the Advisory Agreement and Sub-Advisory Agreement, respectively.
• The prospects for satisfactory investment performance of the New Fund were reasonable;
• The projected contractual management fee, actual management fee and total expense ratio were within the range of fees charged by other funds in the New Fund’s assumed Broadridge peer group;
• Although the advisory fee and sub-advisory fee schedules included no breakpoints in their respective schedules, the Trustees concluded, based on representations from management, that the flat advisory fee was common for long short equity funds;
• Shareholders of the New Fund may benefit from FIMCO’s agreement that total expenses of the New Fund would be capped under an expense limitation agreement pursuant to which FIMCO or the New Fund’s transfer agent, an af-filiate of FIMCO, will limit total annual operating expenses (subject to certain exceptions) to a certain level for each class of shares of the New Fund;
• The cost of services to be provided by the Advisers to the New Fund and the profits realized by the Advisers and their respective affiliates, if any, from their respective relationship with the New Fund would be assessed after the New Fund has commenced operations when the Trustees first consider the renewal of the Advisory Agreement and Sub-Advisory Agreement; and
• The Advisers may receive certain “fall out” or ancillary benefits by obtaining research and other services from broker-dealers that execute brokerage transactions for the New Fund.
| * * * |
Based on all relevant information and factors, none of which was individually determinative of the outcome, the Board, including a majority of the Independent Trustees, concluded that the approval of the Advisory Agreement and Sub-Advisory Agreement was in the best interests of the New Fund and its shareholders and unanimously approved such Agreements.
| 283 |
FIRST INVESTORS INCOME FUNDS
FIRST INVESTORS EQUITY FUNDS
| Trustees | |||
| Susan E. Artmann | |||
| Mary J. Barneby | |||
| Charles R. Barton, III | |||
| Arthur M. Scutro, Jr. | |||
| Mark R. Ward | |||
| Officers | |||
| William Lipkus | |||
| President | |||
| Marc S. Milgram | |||
| Chief Compliance Officer | |||
| Joseph I. Benedek | |||
| Treasurer | |||
| Mark S. Spencer | |||
| Assistant Treasurer | |||
| Mary C. Carty | |||
| Secretary | |||
| Carol Lerner Brown | |||
| Assistant Secretary |
| 284 |
| Shareholder Information | |
| Investment Adviser | Subadviser |
| Foresters Investment Management | (Long Short Fund) |
| Company, Inc. | Lazard Asset Management, LLC |
| 40 Wall Street | 30 Rockefeller Plaza |
| New York, NY 10005 | New York, NY 10112 |
| Subadviser | Subadviser |
| (Floating Rate Fund and Fund For Income) | (Select Growth Fund) |
| Muzinich & Co., Inc. | Smith Asset Management Group, L.P. |
| 450 Park Avenue | 100 Crescent Court |
| New York, NY 10022 | Dallas, TX 75201 |
| Subadviser | Underwriter |
| (International Opportunities Bond Fund) | Foresters Financial Services, Inc. |
| Brandywine Global Investment | 40 Wall Street |
| Management, LLC | New York, NY 10005 |
| 2929 Arch Street | |
| Philadelphia, PA 19104 | Custodian |
| The Bank of New York Mellon | |
| Subadviser | 225 Liberty Street |
| (Covered Call Strategy Fund) | New York, NY 10286 |
| Ziegler Capital Management, LLC | |
| 70 W. Madison Street | Transfer Agent |
| Chicago, IL 60602 | Foresters Investor Services, Inc. |
| Raritan Plaza I – 8th Floor | |
| Subadviser | Edison, NJ 08837-3620 |
| (Global Fund and Hedged U.S. Equity | |
| Opportunities Fund) | Independent Registered Public |
| Wellington Management Company, LLP | Accounting Firm |
| 280 Congress Street | Tait, Weller & Baker LLP |
| Boston, MA 02210 | 1818 Market Street |
| Philadelphia, PA 19103 | |
| Subadviser | |
| (International Fund) | Legal Counsel |
| Vontobel Asset Management, Inc. | K&L Gates LLP |
| 1540 Broadway | 1601 K Street, N.W. |
| New York, NY 10036 | Washington, D.C. 20006 |
| 285 |
A description of the policies and procedures that the Funds use to vote proxies relating to a portfolio’s securities is available, without charge, upon request by calling toll free 1-800-423-4026 or can be viewed online or downloaded from the EDGAR database on the U.S. Securities and Exchange Commission’s (“SEC”) internet website at http://www. sec. gov. In addition, information regarding how the Funds voted proxies relating to portfolio securities during the most recent 12-month period ended June 30, is available, without charge, upon request in writing or by calling 1-800-423-4026 and on the SEC’s internet website at http://www. sec. gov.
The Funds file their complete schedule of portfolio holdings with the SEC on Form N-Q for the first and third quarters of each fiscal year. The Funds’ Form N-Q is available on the SEC’s website at http://www. sec. gov; and may also be reviewed and copied at the SEC’s Public Reference Room in Washington D.C. Information on the operation of the Public Reference Room may be obtained by calling 1-800-SEC-0330. The schedule of portfolio holdings is available, without charge, upon request in writing or by calling 1-800-423-4026.
| 286 |
| NOTES |
| 287 |
| NOTES |
| 288 |
| NOTES |
| 289 |
Item 2. Code of Ethics
Not applicable for semi-annual report
Item 3. Audit Committee Financial Expert
Not applicable for semi-annual report
Item 4. Principal Accountant Fees and Services
Not applicable for semi-annual report
Item 5. Audit Committee of Listed Registrants
Not applicable
Item 6. Schedule of Investments
(a) Schedule 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 & Procedures for Closed-End Management Investment Companies
Not applicable to open-end investment companies
Item 8. Portfolio Managers of Closed-End Management Investment Companies
Not applicable to open-end investment companies
Item 9. Purchases of Equity Securities by Closed-End Management Investment Companies and Affiliated Purchasers
Not applicable to open-end investment companies
Item 10. Submission of Matters to a Vote of Security Holders
There were no material changes to the procedure by which shareholders may recommend nominees to the Registrant's Board of Trustees.
Item 11. Controls and Procedures
(a) The Registrant's Principal Executive Officer and Principal Financial Officer have concluded that the Registrant's disclosure controls and procedures (as defined in Rule 30a-3(c) under the Investment Company Act of 1940, as amended) are effective, based on their evaluation of these disclosure controls and procedures as of a date within 90 days of the filing date of this report.
(b) There were no changes in the Registrant's internal control over financial reporting (as defined in Rule 30a-3(d) under the Investment Company Act of 1940 as amended) that occurred during the second fiscal quarter of the period covered by this report that have materially affected, or are reasonably likely to materially affect, the Registrant's internal control over financial reporting.
Item 12. Exhibits
(a)(1) Code of Ethics - Not applicable for semi-annual report
(a)(2) Certifications pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 - Filed herewith
(b) Certifications pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 - Filed herewith
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment Company Act of 1940, the Registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.
| First Investors Income Funds | ||
| By | /s/ Clark D. Wagner | |
| Clark D. Wagner | ||
| President and Principal Executive Officer | ||
| Date: | May 26, 2017 | |
Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment Company Act of 1940, this report has been signed below by the following persons on behalf of the Registrant and in the capacities and on the dates indicated.
| By | /s/ Clark D. Wagner | |
| Clark D. Wagner | ||
| President and Principal Executive Officer | ||
| By | /s/ Joseph I. Benedek | |
| Joseph I. Benedek | ||
| Treasurer and Principal Financial Officer | ||
| Date: | May 26, 2017 | |